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ROWLETT RAMBLINGS

Another story on Tom Thumb.

1/28/2015

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 According to this Minyard's press release, it looks like Albertsons is becoming Minyard's.......not Tom Thumb.   My head hurts.
http://www.minyards.com/


Thanks, Larry.

Th
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The DMN article re: Tom Thumb

1/28/2015

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New info

1/28/2015

3 Comments

 
I learned of the Safeway, Albertson, Minyard's tradeoffs some time ago.  It was my understanding that Tom Thumb (Safeway/Randalls) was to remain Tom Thumb.  I read in this morning's DMN that our Tom Thumb was going to become a Minyards.  I like Tom Thumb.  I know nothing about Minyards, except it used to be around and now it ain't. 


I know Rowlett can't do much about the trades, but I don't have to like it.  I will give Minyards an honest chance, but if it doesn't work out, I will flee immediately upon my final conclusion, and it won't be to Albertson's.  Nothing against Albertson's, but I have to keep some of my own will into where I buy groceries.
 

Hum......do I know anything about a new grocery coming to town?

Late breaking comments:

See Jennifer Wilson's comment.  That is the story I heard also, but unless I read the DMN article wrong, the Rowlett Tom Thumb (1 of 6 stores) will become a Minyards.  There could have been a re-negotiation since the first story was released.  Or......one could assume that I'm less than perfect.  What a horrible thought. 

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Too much info

1/25/2015

1 Comment

 

Below is a link to information on the proposed bond package.   It will tell you a lot.  It has charts, graphs, color slides, flowery language, professional gobblegook, etc.  It is just rife with pretty stuff.  I only have one question:  Does it tell you anything you need to know in determining how to vote in the upcoming bond election?     However, it does lead to inspired meetings.

http://rowlett.com/Archive.aspx?AMID=87

In my business, one of the things I remain alert for is the receiving of too much information.  More often than not, its purpose is to disguise information rather than share it.  When I get information overload, I smell a rat.
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Here's why

1/25/2015

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The approval of a $25 million bond issue should not add to Rowlett's tax rate.  Here's why:

Although this is a little bit of an over-simplification, the following is basically correct.   Rowlett has been servicing debt for at least $25 million for several years.  This bond debt is now paying off, or nearly paying off.  Within a relatively short time, all should pay off.  We need the city manager to tell us exactly what the payoff dates are.  In addition, we need to know what the weighted average interest rate we have been paying on the old debt.  That information, too, is pain free when reporting to the citizens. 

Now, when you know the amounts of the debt, when it is paying off, and the weighted average of the interest rate, you can calculate how much money we have been paying each year against that debt.  This is money we have been paying for years, and like it or not, we're used to it. 

Just for grins, let's pretend the average interest rate on $25 million of "old" debt is 5%.  Although some of the "old" debt is paid off, probably a little remains, but will be paid off soon.  We need to know that information, too.  Now, lets assume the interest rate on the new $25 million bond debt is 1.5% (which has been reported).  We can now make an interesting calculation.  I won't amortize the loan because I don't know the term of the debt, however I can show you the first years' interest cost difference.   The first year's interest at 5% for $25 million is $1,250,000.  The first year's interest cost for the same $25 million @ 1.5% is $375,000.  The 5% rate costs 3.33 times more.  Replacing $25 million of old debt with $25 million of new debt at 1.5% interest will save Rowlett  $875,000/year in the first year. 

The new bond debt should not cost Rowlett any additional money when the old debt is paid off.  In fact, using the example above, a substantial amount of money is saved.  If the tax rate remains the same, this extra money becomes available, in addition to the new bond revenue.  That ain't a bad deal.  However, that doesn't mean much unless you know what the $25 million + tax savings is going to be spent on. 

Now, we are told some of the $25M will go toward street and alley maintenance.  Well, if we need money for that, it also means that the streets and alleys are suffering from deferred maintenance.  If that is true, then it's true that sufficient money hasn't been spent to keep streets and alleys up to standards.  That would certainly keep the taxes lower, but it also means Rowlett has adopted the formula for maintenance that Balch Springs did many years ago.  You can make up your own mind as to where that got Balch Springs. 

So, we're back to a familiar stop.  What is Rowlett "officialdom" sharing with you?  Do you have enough information to reach a meaningful conclusion?  This is an old question that keeps resurfacing.  How much information did you learn about the library?  How much information did you get about The Villages?     Have you ever seen a single piece of paper that said all the land in North Shore should be Office/Warehouse.  I certainly never did.  I think Rowlett "officialdom" has done an abysmal job of informing the citizens of Rowlett.  I think maybe 10%-15% of this problem is because "officialdom" is trying to hide something.  I think the other 85%-90% is because the city just doesn't know how to talk to the citizens.  They seem to have an image in their heads that elected officials need to act a certain way.  Frankly, I think it's foolishness. 

You will soon (5/9/15) be asked to vote on the bond issue.  Do you know enough to vote?  Get the City Council to publish a list of what they need the $25M spent on. 

If we don't get our hands on a good, well intentioned, list, then we have to vote "no."  Personally, I want to help in developing Rowlett's future.  I would support spending some money on the future.....something that wears well for Rowlett.  The arithmetic says $25 M in new bonds are good deal, but by cracky I want to know what I'm voting on!!!  Cut the gobblygook!!  Quite sliding information out to the public at an oblique angle!!!
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The bond issue

1/21/2015

1 Comment

 
There's been a lot of scuttlebutt about the up and coming  bond issue election.  The citizens of Rowlett will be asked to vote yea or no on the sale of $25 million of bond certificates to finance $25 million of capital improvements.   

There are many parts to this question.  It requires some good thought.   Let's start with some simple discussion, first. 

You all are perfectly capable of forming up your own thoughts, however I thought I would share with you what I think.   That way you'll know where I'm coming from when I offer in idea for your review. 

In politics and finances, I am conservative.  I hate government waste.  I can forgive a government that makes a mistake, then admits it, and then moves on to correct the mistakes.   On the other hand, I have no patience with government that is blatantly wasteful and makes no apologies for it.  That is unforgivable. 

After having said that, I must confess that in planning for the future, I'm a little bit of a  liberal.  Of course, that means that the same conservative principals must still apply to investment in the future.  It's like buying stocks.  There are conservative investments in stocks........and there are risky investments in stocks.  Both are investments in the future, but one is more likely to produce acceptable yields while the other may....or may not. 

Thought processes of citizens attempting to justify the selling municipal bonds are much the same, in my  opinion, with a little wrinkle......tax revenue. 

Larry Beckham, a good friend of mine, once wrote and shared some of his research on the pending bond sale.  He had learned that some earlier bonds sold by Rowlett were approaching maturity and would soon begin to pay off.  Therefore, the taxes collected to pay the debt load in the past would soon retire and presumably become available to either lower the tax rate, or pay for additional bonds.  I know this circumstance to be fact.  From a municipal bond point of view, Rowlett is in pretty good shape.  Now, Larry's observation can be refined a little further.  The bonds purchased several years ago in all probability had a much higher interest rate than the current bond market rates.  Therefore, the tax revenue needed to retire older bond debt should now be well above adequate to retire new bonds at the current market interest rate.  So, if new bonds are sold at a lower interest rate than the rate of retiring bonds, Rowlett should have a little extra cash.   For example, let's suppose you bought a car for $20,000 four years ago.  Now you just paid off the last payment of the car and you want to buy another new car for $20,000, but the interest rate is less.  You don't need a raise in salary to buy the new car.  Your payments will be less because the interest rate is less.  You have already budgeted the payments for four years.  Your new car will cost no more each month, in fact, a little less. 

Now the question becomes whether you need another $25 million.  Another question that occurs is why, if any, additional tax increase is needed for debt that we have already grown accustomed to paying.  As mentioned above, the interest expense should be less and therefore less tax revenue should be needed to retire the new bond debt. 

Any additional increase in tax could be needed (wanted) for other things.  You need absolute clarification from Rowlett "officialdom."  What's the new tax increase for? 

Here is what I think city hall owes the citizens of Rowlett:

1.  I think you should be informed on the schedule of debt retirement.  You need to know how much debt is retired and the interest rate on the bonds.

2. I think you need a complete list of what the new bond debt of $25 million is for.  It must be capital improvements.  It can't be for new hires, banquets, or it can not be given away to developers under economic development programs.   It must be for streets,  alleys, parks, and new capital improvements.  All the other niceties could be covered under the general tax revenue. 

3.  You need a list of where any tax increase is to be applied.  In other words, a source and use of funds. 

All of the above items should be presented to you in layman's terms.  It should be easily understood.  We don't need any bureaucratic gobblygook.  Only when getting good, clear, information can you properly analyze the spending of your tax money.

Only then can we begin to understand where our money is going.  We can then make intelligent decisions.  If "officialdom" can't make it clear what we're being asked to approve, then vote no.  It's only when a leader steps forward and explains fully what our options are, and what we're getting for our money, that maybe we can vote yes. 

This post dovetails into another story about how well Rowlett "officialdom" shares knowledge with us.  I honestly think they try, but just don't know how to do it.

More bond posts and sharing of information posts are coming up.  Stay tuned.  I'm still pretty busy, but I see a light at the end of the tunnel. 

 . 

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Bear with me

1/21/2015

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I know this sounds redundant, but please bear with me.  I have one more trip to Ft. Worth to make and four reports to finish up.  That will clear me up for a few days.   It would be a delight to get back to writing the blog.  I have two topics I wish to research and write about; the bond election, and the information sharing between city hall and the citizens.  I feel both need to be addressed.  
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An apology is in order

1/16/2015

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I must apologize for remaining away so long.  I have not been this busy in my income work since I was 45 years old........and be assured, I am not 45 years old anymore.  I am not quite out of the woods with report writing, but I'm getting there. 

I am most intrigued by a comment sent in by Jennifer Wilson on the Purchase vs. Rent post.  She has more questions than I have time to  address at this point, but certainly she asks some very good questions. 

I wish that you would go to the last post and read her comments.   Just click on "comments" and scroll to the bottom of the page.  I think my readers would like the thoughts Jennifer offers.  I can answer a couple of easy questions.  City Council members are elected "at large."  Even though they are assigned Place numbers, they represent no specific geographic area.  To use Jennifer's words, its a "mish mash."  Also, no public money should ever be used to maintain any private parks, unless there is a very specific agreement whereby the public's interest is protected and preserved.  This would be rare.  Very rare.

I was delighted to get Jennifer's comments.  That is precisely the type of interest I was trying to ignite. 

I hope to finish up my business over the weekend and get back to writing the blog.  I am way behind.  Bear with me.
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Purchase vs. rent

1/8/2015

1 Comment

 
I just read the local newspaper.  I don't have any idea what most of the numbers are, however from what little I know, I agree with the thought that the city should look into purchasing or building temporary quarters for the library. 

I had talked to the mayor several days ago and he expressed some concern about the cost of rehabilitating the proposed space as being too expensive for the city.    The numbers he shared with me were pretty impressive.   Of course, this is my game.

I did some quick "recapture" rates in my head and quickly agreed with him that the rent and rehab costs proposed for a two year period were prohibitive.  At the time, I said it was a much better alternative to purchase something or build something.  Then, after the new library is built, the city could use the space for other departments and thus free up the more valuable downtown space.  That would allow further development downtown.  Also, they could consider building a functional, but less expensive building on cheaper land for utilitarian use by the city after the library leaves.  In either case, the building could then be sold or used by other city departments.   It is quite possible that the city could fully recover the cost of the temporary use of the library.  It all depends on the cost of acquisition, or the cost to build. 

It is subject to prudent property management, but it could be done.   

While we're on the subject of the library, I would like to see a really nice library.  I would like to see a library that the community deserves.......not just a building, but all the services that could be offered from within.  Rowlett deserves a top shelf library.   Something Mark Twain would be proud of.
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Holiday season over

1/4/2015

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Well, I must say, I am glad the holiday season is over........but not for the reasons you might expect. 

I basically missed all the good times associated with this season.  I have had the flu, plus a relapse, since the Tuesday before Christmas.  I started getting a fever on the 23rd, and it continued until the day after Christmas.  On Friday, the fever broke, but I still ached in every muscle and joint.  I had absolutely no energy.  By Sunday after Christmas, I felt fairly good and attended a birthday party for my grandson on Sunday night.  The following day, the fever came back with a vengeance.  I was down all thru the day after New Years.  Finally, on Friday I began to come around.  I felt good on Saturday.

I missed every single family and friends festivity held during the two and a half week period.  I peeked outside on Saturday and, lo and behold, there was even some sun shining.  Today, the sun is shining and it promises to be a very good brand new year.  I wish you all the best. 

I now am horribly behind........on everything.  I don't know where to start to catch up.

I would like to make some brief comments about what I think is going to be extremely important to Rowlett in 2015.  In my opinion, the two biggest news stories effecting Rowlett during 2014 were the announcements of Toyot0's arrival on the scene and the efforts to acquire Robertson Park. 

These two events could have enormous effects on Rowlett.  On one event, I think Rowlett's "officialdom" is totally blowing it.  On the other, I think they are fully apprised and are effective in pursuing it. 

The issue of which Rowlett's "officialdom" has totally screwed up, is the total misreading of the Rowlett housing market and it's potential.  Rowlett has put into effect residential zoning which almost completely eliminates their participation in one of the strongest residential markets this area has seen in 20 years.   We have one residential development underway.   We are a town of 57,000 people, in North Texas, and only have one subdivision underway.  Our subdivision is  proudly touted as our "first Form Base Code subdivision."  It may also be our last.  It is an unproven market.  It is reported that two very good builders, David Weekley and Cambridge Homes, are going to build out the subdivision.  That could be true, but only if Fred and Ethel likes the development, houses, and the price.   Believe me, David Weekley is no fool.  He will be in that subdivision so long as the houses sell.  If they don't, he will be out of there.  If that should happen, Rowlett will have a white elephant on their hands.  The developer will be long gone. 

At the present time, Rowlett has some beautiful residential land we know as North Shore.  It is ideally suited for the new endeavors of Toyoto and the new State Farm buiding on the SE corner of Bush Toll Way and North Central.  There will be thousands of families looking for new homes, and there we sit, just 20-30 minutes of commute time away.

This superb opportunity has been totally throttled by our new zoning for North Shore.  You don't have to be brilliant to realize this.  The news reports hammer us almost every day with the data that backs up that fact.  This total malfunction is a result of a past dictatorial city manager and a staff that wouldn't dare cross her.  I have said many times in this blog, our past city manager was the worst real estate analyst I had ever seen.  The North Shore fiasco proves it.  It is high time to admit we were wrong about North Shore and take steps to correct the misfire.  

The issue that is good for Rowlett and I think the city is doing a credible job of nurturing is the Robertson Park acquisition.  We have a credible developer, or facilitator, offering to purchase the land,  and has developed  what appears to be a workable relationship with the City of Rowlett.  I think the good news here is that Rowlett is staying out of the real estate business and is centering on what they can do as a  city to expedite the acquisition.  That is good......very good.  The city can calculate costs of fire protection, police protection, utility costs and tax revenue.  That's what they're good at.  They need to stay out of the real estate business.  They aren't any good at it.  (Example, North Shore). 

I'll give you something to whet your appetite.  Fully developed, the Robertson Park land might produce $1 Billion in taxable value.  It will take a few years to get there, but can you even imagine what that can do for Rowlett?  The City of Grapevine has done pretty well since the construction of DFW Airport.  The seed money for that pretty spectacular rise was 5% of every drink sold at the watering holes at DFW terminals.  That gave Grapevine the opportunity to springboard on to bigger and greater things. 

Rowlett has a bright future, if we don't screw it up anymore.  The next election in 18 months is very, very, important.  We need leaders that have something between their ears........not personalities. 
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