Hirschfeld Energy Topic of Two Executive Sessions

For two years the City of San Angelo has not released information on Hirschfeld Energy's maintaining its employment targets under a $5.6 million economic development agreement.  The original deal was with Martifer-Hirschfeld but Hirschfeld bought out Martifer's 50% share in July 2012.

Hirschfeld Energy's 2013 and 2014 performance under the terms of the agreement should be clear by now.  The 2012 COSADC Annual Report stated:

COSADC and Legal staff are currently working with the company to determine the long range employment goals for the company and a schedule for repayment of any funds due.

From city documents it appears Hirschfeld paid back the city $140,000.  The question is what happens moving forward.  Governor Rick Perry renegotiated numerous economic development agreements outside the light of day.

COSADC Director Roland Pena requested board members not reveal information about companies to the public.  If a company is requesting public money sunshine should apply.   That information should be openly and freely shared with the public.

COSADC's executive session did not report any changes to the city's agreement with Hirschfeld Energy.  City Council will entertain their unstated action.  I expect a public accounting in the future, if not at this meeting. 

Update 3-7-15:  Add two more Executive Sessions for City Council, their regularly scheduled meeting on 3-3 and a called meeting on 3-11.  The Mayor recused himself and will not be at the called meeting.

Who Will Fill San Angelo's Room Boom?

San Angelo has a number of apartments and hotels ready to come online.  They were planned and constructed during our local economic boom, fueled by oil and gas exploration.  The picture has changed and is expected to become more dire.  Bloomberg reported:

Oil drillers will begin collapsing under the weight of lower crude prices during the second quarter and energy explorers who employ them will shortly follow, according to Conway Mackenzie Inc., the largest U.S. restructuring firm.

Companies that drill wells and manage fields on behalf of oil producers will be the first to fall after the benchmark American crude, West Texas Intermediate, lost 57 percent of its value in seven months, said John T. Young, whose firm led the city of Detroit through its 2013 bankruptcy. 

Oil companies have slashed thousands of jobs, delayed billions of dollars in projects and dropped or scaled back expansion plans in response to the prolonged rout in crude prices. For oilfield service providers that test wells and line the holes with steel and cement, the impact of price reductions forced upon them by explorers will start to pinch hard during the second quarter, Young said Thursday. 

“The second quarter is going to be devastating for the service companies,” Young said in a telephone interview from Houston. “There are certainly companies that are going to die.” 

How will the reduction of primary jobs impact secondary ones?  Traffic on the Mertzon highway is less crazy and more oilfield equipment is parked in company yards.

Hotel rooms might be more available for San Angelo's Stock Show and Rodeo.  This year attendees may be a room at a decent price.

Update 1-31-15:   Texas' rig count continues to decline.

Update 3-5-15:  Bloomberg raised the question as well.

Upscale Harbor Village Returns After MLK Holiday

San Angelo's City Council will meet the day after city staff enjoy a holiday in honor of  Reverend Martin Luther King.  This council will entertain development of Lake Nasworthy public park land, an area envisioned as Harbor Village.  This Harbor would include a hotel, restaurants, beach and marina.

Consultants and staff suggest the public only provided positive input.  This is patently false.  I attended numerous sessions to represent local windsurfers.  I spoke during the public meetings and followed up afterwards when it was clear consultants had not heard or understood our position.  It is simple:  local windsurfers would like to keep the access we've enjoyed for years and would be happy with any improvements.

Both the Lake Nasworthy and Twin Buttes Master Plans stuck windsurfing in the worst possible locations.  They had deep drop offs, limited access to the main body of water or were in a prevailing wind shadow.   Please city leaders, if you eliminate our current windsurfing access don't tell us how great we're being treated.

Be straight up with people.  The City of Lake Jackson took away the popular Dow Park in the late 1980's for development of luxury homes.  The city made no bones about it. 

That may be what consultants and staff mean by their recommendation to City Council:

We recommend an initial build of an upscale full-service property of at least 200 room.

Windsurfers have been crowded out of two reports, despite clearly speaking. 

"Everything that we see is a shadow cast by that which we do not see." - Rev. Martin Luther King 

It appears windsurfers will be an afterthought as the city moves ahead with lake development.  Who else might be crowded out by upscale, full service property with a hotel, restaurants, and marina?  The beach can only accommodate so much.

Engineering Drought Hurts City

City Council discussed the city's planned debt issue for capital projects during its December 17 meeting.  The topic of streets arose and whether to borrow now for expected street improvements or reconstruction. Assistant City Manager Micheal Dane said a 90 day lead time would be necessary to obtain bond financing.  That time frame grew dramatically when Dane added contracting time to obtain outside engineering services.

Director of Operations Shane Kelton said the street study would be complete by July or August.  At that point City Council will know the condition of all city streets and the recommended maintenance for each street, which could include complete reconstruction.  Prior City Councils under invested in city infrastructure and the team of Ricky Dickson and Shane Kelton failed to advise them of the costs of a long term failure to maintain.  For their "go along - get along" silence both men have been promoted under City Manager Daniel Valenzuela.

Oddly, ex. Assistant City Manager and City Councilwoman Elizabeth Grindstaff spoke directly to this issue:

"Unfortunately our city has been very negligent in keeping up with any infrastructure needs on an ongoing, sort of annual basis."

Shane Kelton told Council if they voted today to do Bell Street " based on our current staffing in Engineering, where we are today, we are looking at 12 months to go to bid."  Kelton added it could be go six to eight months faster with contracted engineering.  Assistant City Manager/CFO Michael Dane added in a series of remarks:

"He's got to hire an engineer...  If you go out of house for engineering, you're going to need money to pay for those engineers to do the work.  It takes three or more months to get a professional services contract...  It we're going to go outside for engineering we need to get the professional services purchasing process going now."

Repairing streets in San Angelo will get more expensive if contract engineering firms do the design. Design fees can range from 5 to 12% of the project.  That can quickly turn $60 million for streets into $65 million. 

Council's history of underfunding infrastructure combines with our current engineering dearth in expensive ways. 

Community Cat Ordinance Neutered

San Angelo's Animal Services Advisory Committee needed but a few wording changes in its proposed policy on Community-Free Roaming Cats for the group to vote.  The committee specified the language in their November meeting with a city attorney present.  Staff failed to implement the committee's directive, thus no ordinance was available for the Committee to consider (despite this item being on the agenda).   The neuter definition that applies here is: "To render ineffective or powerless."   

What will the New Year bring?  Hopefully not more of the foot dragging, heel digging, obstinacy community animal groups have experienced for years from animal services.

Update 1-18-15:  The New Year brought a new Community-Free Roaming Cat Ordinance.  It's expected to go to City Council in February.

Nasworthy Development to Progress on Two Fronts

The City of San Angelo is moving forward with developing two areas around Lake Nasworthy.  The Standard Times reported:

The Parks and Recreation Advisory Board voted Thursday to recommend that the council give city staff the go-ahead to start seeking bids for concepts on the development.

The development was recommended in the Gateway Planning Group’s Lake Nasworthy master development plan, which the council adopted in late 2013. The plan recommends a hotel, restaurant or entertainment venue for the 19½ acres at Mary E. Lee Park to enhance public access and minimize environmental impact.

Earlier this year the city issued a request for proposal for development of surplus land near the old WTU power plant.

The City of San Angelo is soliciting proposals for the development of certain vacant land consisting of two (2) tracts located in the southwestern portion of the City of San Angelo, known as Railroad Right of Way, near the Old WTU Power Plant. The subject parcels are located near Red Bluff Road and Hillside Road. The City of San Angelo is interested in selling the surface estate only of the described parcels of land , to an entity with experience in mixed-use development.

City Council will entertain the sale of said land to Psalm 100 Development LLC during Tuesday's council meeting.  Russell Gully is listed as Psalm 100's registered agent.  Gully is the owner of SKG Engineering, which has done several projects for the city, including the new pedestrian access improvement project.

WTU surplus land bid documents revealed:

Each firm will be expected to supply a reasonable and probable use that supports the highest present value of vacant land; taking account the contribution of the specific use to the community and act in accordance with the 2013 Lake Nasworthy Master Plan and Implementation Strategy.

The selection committee was specified in the RFP:

The selection committee will consist of representatives from several City departments that are currently involved with the development process in the subject area. 

It will be interesting to hear how public access will be enhanced, learn specific uses to the community and understand how the city determined the highest present value for development.  Oddly, purchase price garnered a mere 15% weighting.  For a new landfill cell it was 75%.

Psalm 100 Development LLC registered with the State of Texas on August 21, 2013.  That makes the company just over a year old.

In another interesting twist Russell Gully sits on the City's Water Advisory Board and is in his third term. Also, a Gully (no first name) leases 2.6 acres of land around Lake Nasworthy for $392 a year.     

It remains to be seen if Nasworthy development mirrors Lake Jackson's elimination of Dow Park, once a hugely popular place for runners, cyclists and walkers.  The public park was eliminated for development of high dollar real estate lots.  

I look forward to hearing Executive Director of Public Works Ricky Dickson's presentation.  I trust it will clarify the nature of Mr. Gully's role with Psalm 100 Development LLC. 

Update 1-18-15:  Executive Director Public Works Ricky Dickson's presentation made no mention as to how public access would be enhanced.  He did not speak of any specific uses to the community.  He never spoke as to how the city determined the highest present value for development. 

City Council Special Meeting 12-9

San Angelo's City Council will hold a special meeting Tuesday, December 9th.  The agenda states:

To deliberate the purchase, exchange, lease, or value of real property (Spur Parking Garage, east of 40 W. Twohig Ave., San Angelo)

A commercial real estate listing for the sale of the Spur Building states:

Very Charming Office Building in central downtown San Angelo. Must see pictures and visit to greatly appreciate the value and characteristics of this one of a kind investment opportunity. Completely refurbished in 1984. A new elevator was installed within the last 4 years. Parking garage attached and accessible to the building owned and maintained by the City of San Angelo.

Councilman Rodney Fleming said he'd close the parking garage in a recent council meeting rather than pay city funds for renovation or refurbishment.  The City estimated the project could be completed for $1.8 million, however that would rise to $2.95 million if phased.

What's not clear is the city's legal obligation to provide and maintain the parking garage for Spur Building tenants.  That will be interesting to learn.

Update 12-8-14:  The Standard Times ran a piece on this topic.

Update 12-10-14:  The city will lease the parking garage to The Spur Group LLC.