Keller Citizen Legislature

Use wisely your power of veto

Browsing Posts in Capital Improvements Program

Maybe when the city issues the bonds for all the new projects we are about to embark on, they will find a subprime lender.

Private economists warned the worst slump in housing in 16 years and the turbulence in financial markets from a resulting serious credit squeeze could push the economy into a recession as more borrowers fall into default, dumping even more homes onto an already glutted market.

“You have a lethal combination of higher mortgage payments, lower house prices, a weaker job market and more cautious lenders,” said Mark Zandi, chief economist at Moody’s Economy.com. “That is a very noxious mix and it is the reason for this surge in foreclosures.”

Zandi put the possibility of a recession at 40 percent, almost four times the possibility he had estimated in July, before the current credit crisis hit.

Not the time to embark on a $30,000,000+ spending spree.

At last night’s Town Hall meeting to discuss library options, Interim City Manager Kevin Lahner described, in general terms, the city’s financial health and borrowing capacity. He correctly noted that the forecast for property tax revenue is quite good, and that our payments for our debt obligations are going down. He showed a graph that looked something like this:

This graph is an accurate depiction of Keller’s future payments on existing tax-supported debt. Note, though, that it does not include the debt for the Town Center TIF (including Town Hall and the Natatorium), nor does it include debt that is supported by our water bills.

The problem is that no one showed you the borrowing that we already know we need to do. According to our five-year Capital Improvements Program, we need to spend over $90 million in the next few years on major road projects like North Tarrant Parkway, Rufe Snow, and the 377 couplet; fire stations, sanitary sewer in North Keller, park land acquisition, street maintenance, etc., etc.

Of the $90 million, we expect to issue over $50 million in new debt to meet our obligations (the rest comes from federal and state funding, and other sources.) If we borrow $50 million over the next five years to meet these obligations, here’s what the new chart would look like:

Keep in mind that this only includes capital spending that we expect to spend today. It does not include dramatically increased costs for additional personnel (particularly firefighters,) nor does it include unexpected capital needs. Since the CIP was developed many months ago, it does not include the drainage improvements identified by Keller’s recent flooding.

Here’s a link to my spreadsheet, for those of you who want to refute my numbers.

When my fellow council members and I toured some area libraries a few weeks ago, we visited Timberglen library—a satellite library in Dallas. Timberglen was chosen because it was a Silver-level LEED-certified building. It was a disaster—the natural-cork flooring was buckling up all over, the automatic-dimming lights automatically kept the building too dim all the time, and the rainwater-dependent toilets…well, that speaks for itself.

Timberglen Public Library

There was some discussion, also, about making Keller’s new fire station LEED-certified. Ideas included a geothermal heat pump and—get this—a system to recapture the water used to wash the fire engine. Lovely thought, but when we’re paying $1.50 for a thousand gallons of water, how long will it take this thing to pay for itself?

Since there’s nothing voluntary about the tax revenue we receive, I think we should leave these trendy experiments to the private sector. Government can then adopt the tried-and-true technologies.

I disagree with our continued watering restrictions (no watering between 10am and 6pm, instituted during 2005-2006 drought) because we’re starting to sound like the little boy who cried wolf. If we keep a perpetual state of emergency going, it’s going to be hard to get buy-in when there’s a real emergency. (Of course the City of Fort Worth dictates our water policy, and doesn’t much care what I think.)

On a planet 70% covered in water, I can’t help but think that if we spent half as much time teaching our kids engineering and chemistry as we spent frightening them about resource depletion, we’d have all we need and a clean planet, too.

I am an avid recycler, but I suffer from no delusions that I’m ‘doing my part to save the planet.’ I recycle because I hate waste, and if something useful can be made from the things I throw away, I’m willing to pay a little more to do that.

As for manmade global warming, I’m more worried about the intellectual climate.

Description:

The proposed Tennis Center includes sixteen (16) lighted tennis courts with a pro shop, restroom facilities and a parking lot. Land costs are not included in the project total. It is anticipated that the facility would be constructed on existing park land or through a public/public or public/private joint agreement. The facility is expected to operate at 60% cost recovery from user fees.

Justification:

The tennis facility is a priority of the Keller citizens as indicated in the 2007 Parks and Open Space Master Plan. Currently, the only public tennis courts available are provided by the Keller school district. Scheduling conflicts, lack of restroom facilities and poor lighting conditions require citizens to travel to other cities for tennis activities.

The CIP projects this facility to cost $4.5 million in Fiscal Year 2010, to be funded by General Obligation Bonds/COs.

Description:

The project includes an amphitheater with lighting and terraced seating in the Parks at Town Center.

Total cost includes:
Amphitheater = $164,000
Stage lighting = $44,000
Terraced seating = $180,000

Justification:

The proposed amphitheater is included in the Town Center Master Plan. The amphitheater will provide a community stage within Town Center to host special events, concerts, theatrical plays, wedding rentals and more. Such programs will generate more activity and draw more visitors to the Town Center area.

The CIP expects this to cost $388,000 in fiscal year 2010, funded by Oil & Gas Royalty Revenue.

[Note: This entry is in the Top Ten not because of the post, but because of the ensuing dialogue in the comments section.]

Every year, the City of Keller publishes a Capital Improvements Program—a nicely bound book that lists potential capital expenditures, each on its own page, complete with a description and justification section. Anticipated expenditures along with likely revenue sources are listed year-by-year for the next five years.

I’ve just received my copy of the 2008-2012 CIP. In it are 90 pages of capital the city staff intends to spend. In a recent email, the Assistant City Manager said that I, as a councilman, am entitled to request that the Council make changes to this document.

So I’d like to start discussing these pages with you, dear taxpaying readers. [I assume I'm entitled to do this.] Let’s start with page seven, titled “Construct New Public Library”:

Description:

This project includes funding for a new 35,000 square-foot facility. Materials include books, audio, visual, video, and furniture, fixtures, and equipment. Project construction costs reflect fourth quarter 2006 construction cost estimates, adjusted for 3% annual inflation. The existing Library building at 640 Johnson Road could be converted to a Senior Center.

A bond referendum proposing a new 35,000 square-foot library to be constructed in Keller Town Center at an estimated project cost of $7.6 million was defeated by the voters on May 13, 2006.

Justification:

During FY2001 the City Council appointed a Library Bond Study Committee to analyze the results of the failed referendum for a new facility, and determine the feasibility of calling another referendum on a library facility that would be more cost effective and to meet the needs of the community. The conclusion of the City Council following the completion of the Committee’s review was that in order to not impact the City’s tax rate, by increasing the debt obligation related to the new library construction, additional study was needed including the size of the library, proposed location, and further, determine the feasibility of expansion of the current facility versus construction of a new facility.

During FY2007 the City Council intends to conduct a needs assessment and expansion study of the existing library at 640 Johnson Road to determine the effectiveness and efficiency of the facility as well as determine whether or not to expand the facility. No costs are available. The cost of the study is funded in the Library Special Revenue fund.

The CIP lists this capital expenditure as $8.8 million of “future” spending.

So I ask you, reader, what changes, if any, would you make to the Description, Justification, and anticipated amounts on this page?