I want to write about our current leadership. I will not address individual members of Rowlett's leadership. I will still refer to them as "officialdom" and that includes all elected officials and some of the staff.
Up until a few years ago, we seemed to be doing pretty well as a small suburb of a major city. However, some things began to change. We began to emerge from obscurity. We were getting a brand new tollway and a DART rail station, all within a year of each other. Talk began of some great things in the future. Being in the real estate financing business, I knew some of what was coming. It didn't take a lot of experience to know that 57,000 people were going to require some "needs" and that developers and business leaders would provide them.
Our elected leaders were reasonably smart and, for the most part, seemed to be interested in doing right by Rowlett. Some seemed to be a little more interested in their own ego, but generally acceptable. We went thru a period of extreme egos. Our ex-mayor, John Harper, and our ex-City Manager, Lynda Humble, had enough ego to supply a battalion of Marines. I didn't have much exposure to Harper, but had all I wanted of Humble.
I will let you in on a secret. The reason I have this blog is because of Lynda Humble. I didn't run for a second term as City Councilman because I wanted to fight Lynda Humble, and I could do it more effectively from here than City Hall. After I had already bought my website software, she resigned (fired?) I was delighted. That was a good Thursday. Since I already had a website, I decided to write about Rowlett....and here we are.
Now, let's talk about Rowlett leadership. I wrote above that our elected officials are smart. However, that doesn't make them real estate experts. In fact, they're pretty pedestrian in that field. Doctors are smart. However, they can't fly a Boeing 747. We can't expect our elected officials to be budding Donald Trumps. However, we can expect them to do their homework, inform us in what they're doing, and educating themselves on what is best for Rowlett.
Up until a few years ago, our little run of the mill town made no great demands on our elected officials. Then, some big kids came to town. There started being things that required some experience.......or study. There are a number of things that any $80 million a year budget of a city requires. Real estate knowledge is only one of them. I only write about real estate because it's what I know and it contributes to our tax base, which is the machinery that makes everything happen. If you have a great tax base, you become Frisco. If you have a poor tax base, you become Balch Springs. I consider tax base the most important feature of any town. It's where the money to operate comes from.
As intelligent as our leadership is, experience of negotiating large real estate deals is not one of their better skills. I don't think any of them have a calculator. I think "officialdom" was okay up to a point. Then, Lynda Humble started cramming her wants down their throat. Lynda Humble was one of the worst real estate analysts I have ever known for such a high position. She didn't know about loan priorities, lien issues, and her marketing skills were terrible. She only knew what she wanted, and that was all that mattered. Some of her disciples are still with Rowlett. Humble crammed North Shore zoning, Form Base Codes, Rowlett 2020, and Homestead at Liberty Grove right down our throats. She kept trying to make Rowlett inner city Dallas. Rowlett isn't Dallas. If you want inter city living, move to the M streets. There is some need and want for high density living, but not the whole town. I like Rowlett's charm. I like rural charm. Rowlett still has it. I want to keep it. I don't need some arrogant, egotistical, self centered, pompous ass, whether elected or staff, telling me what I want. Hopefully, with the departure of Lynda Humble, that confrontation is relaxed.
Now, what we seem to have is an intelligent and dutiful group of elected officials and staff that wants to serve the citizens of Rowlett. Up to a certain point, I think they do fine. Then, the big deals came to town. In my opinion, that's where some of the wheels came off. For example:
1. P&Z and City Council turned down two residential deals in what is now known as North Shore. If approved to go forth, these two projects would now be adding $600K per week to the tax base. When fully developed, the two projects would have produced $1.2 million dollars per year in revenue. There are 57K residents in Rowlett. These denials cost every man, woman and child $21.05 per year or $86.20 per four member household. Subsequent to declining these two subdivisions, the North Shore area was zoned for Office and Warehouse. There was no documentation submitted that offered proof that Offices and Warehouses were viable in the North Shore area. In fact, they are not. This type of development would be on a tollway without any major free thruway streets. Merritt and Liberty Grove are intersections, but they don't go anywhere. Upper management will accept paying money to have an easy commute home, but if placed in charge of locating their next offices, they will not select a tollway with no "free" cross streets. It would cost another $1.00 per hour per employee to get the better employees to work. If they had trucks, they would have to pay toll fees for all inbound and outbound rolling stock. These costs would come right out of their company's operating statement. I haven't heard any stories about offices or warehouses coming to town. The two subdivision denials probably chased off any residential development.
Do you think that was a smart decision? Our City Council approved it.
2. Let's look at the Villages of Rowlett. When the Villages was first submitted for approved, the Staff report said that Rowlett would be investing $6 million, but that about half would be reimbursed by "380 Grants." Someone failed to tell the public that "380 Grants" was money put up by the city of Rowlett. That commentary was a pure subterfuge........inserted to lure casual readers into thinking some financial relief was coming to the project. You weren't getting the truth. The next time the Villages came up for approval, the "380 Grant" language disappeared. Only the $6 million "investment" was mentioned. That, too, was a lie. You will see my cost numbers in a couple of other posts in this site. I will summarize here. It's going to cost Rowlett over $11 million and there is a 15 year tax abatement. So let's look at the numbers. We will spend or forgive $11 million in cash or tax revenue for 15 years. It will take two years to develop the project, and 15 years of tax forgiveness. Therefore, it will take 17 years before collecting any money. However, at $220,000 per year, it will take 50 years of collecting taxes to repay the $11 million. When added to the 17 years of freebies, it will take 67 years to get our money back. I have a 5 year old grandson that can negotiate better than that. Will it help the downtown? Probably, but not enough to reasonably offset such an investment. In fact, we have already given away three pieces of land downtown for restaurants. I think the restaurant developers have already requested an extension on their contract obligations. Of course, it was given. So far, we have a big zip.
Do you think those are smart decisions? Our City Council approved them.
3. Let's talk about our greatly heralded Homestead at Liberty Grove. On June 28, 2014, the bands were playing and the dignitaries were under the tent. The very first Form Base Code subdivision was coming to town!! This was only surpassed by the invention of canned beer!! I went to the Grand Ribbon Cutting. I just happen to know a little bit about land development. I have been a loan officer, a loan administrator, an inspector, an auditor, or a cost analyst on several hundred land development projects. I know what one looks like.
As I said above, this project had a ribbon cutting on June 28, 2014. That was about 13 months ago. During that 13 months, there was an unprecedented amount of rain. I am building a restaurant in Wylie and the rain slowed me down three months. The same would have happened to any developer........and it did to every one of them in the DFW area. I became involved in 6 subdivisions for three area banks, all at the same time. All six subdivisions have completed development and are currently constructing homes in them. It usually takes about 8-9 months to "turnkey" a similar subdivision as Homestead. Building permits for models are usually taken down at about 7 months. Then, builders start their models. About 3 months ago, I called a senior leader of Rowlett's "officialdom." I said Homestead was running about 4 months behind schedule. This leader called me back and said the developer reported that because of the rain, his subcontractors were leaving the job for other projects and it was difficult to get them back. Therefore, it was hard to keep production up. Now folks, think about that. Just where in the DFW metroplex was it NOT RAINING? It costs money to move equipment around. That was a bunch of crap, but our leader bought into it. They spotted the concrete batch plant on site a couple of months ago...long before they needed it. I drove thru the subdivision today. It looked awful. Weeds were everywhere. If that was my land, I would have received a ticket from the code enforcement officer. There is only a small amount of concrete poured in some portions of alleyways scattered all over the subdivision. Most of the streets are now on final grade, but the forming and the steel is checker boarded all over the place. In fact, in some places they are still working with the soil pipe. It is the most bizarre sequence of land development events I have ever seen. There has been no final lot grading. None of the lots are benched. Even when all the concrete is poured and the grading completed, there still needs to be the electrical and cable conduits installed, cable run, transformers and light standards set, and street lights installed. They are at least 4 months away from completion. However, that's not the big problem.
It is reported that two large builders have committed to buy the lots. I can only address one of them. I have known the David Weekley group for many years. I was around when we made a construction loan to them when they were first forming up in Houston. I made then a $5 million loan the year they moved some of their operations to Dallas. David Weekley thinks at least a year ahead of his needs. If he commits to buy some lots a year from now, it is recommended that the developer have them ready. I would bet my wife's toaster that that date in Homestead has come and gone. Does anyone know if the contract is still good? That would be a good question for "officialdom." Or.......do we have a white elephant?
This subdivision was wildly ballyhooed by our ex-city manager. The developer was supposed to be solid gold. I beg to differ. His subdivision is suffering from what appears to be very poor site management. He certainly isn't proving out to be as good as I thought he was going to be.
Our first Form Base Code subdivision ain't doin' so well. I remember many times "officialdom" celebrating anything that had Form Base Code attached to it.
Do you think City Council knows what Form Base Code means, or how it works? I don't.
4. Let's talk about Form Base Codes a little bit. You should have noticed by now that anything Rowlett 2020 and Form Base Codes has attached to it has some kind of heavenly blessing that nothing can go wrong and success is assured. Wrong.
There are issues with FBC. Take a look at the hypertext:
Form base codes work in some places.......but not everywhere. I think Rowlett "officialdom" is trying to urbanize ALL of Rowlett, when all that is needed is tasteful selection. I have had previous experience with FBC long before Rowlett's entry into the fray. It only kinda worked. Simply stated, everybody doesn't want to live 10 feet from their neighbor and still want a back yard for their kids. Some places FBC works.......and some places it doesn't. There are several other stories about our current real estate developments that seem to be a little slow on the uptake. I wish I had the time to research all the stories. However, all are not bad. There are some good stories, too.......but not enough of them.
Let's take a look at Lake Point Hospital. Just about everyone knows that the hospital is nearly doubling it's size. "Officaldom" proudly announced that Lake Point was going to comply with Form Base Codes. At the time, I wondered how that would happen. Hospitals usually have a finely defined program and well developed design for their facilities. I didn't see how FBC would help. Later, I learned that the hospital was going to design and build what they wanted and needed. The biggest employer in Rowlett told City Council to take a hike. FBC went bye bye.
Conclusion: Can't our leaders see all the above? Why are they so bullheaded about common sense. Humble is gone. Who's forcing the issues.......Planning? There is no one on council that can talk Planning's lingo, therefore they don't ask the appropriate questions.
I could go on further, but I think I've made my point. Our elected officials were doing a pretty good job until they entered the big boy's game. The negotiations got tougher.......the players smarter. Developers had brand new calculators.
Once, many years ago, I wrote in the Dallas Morning News that a great time was coming to Rowlett, but we only had one chance to get it right. Several have copied my comments. Well that "chance" time is here. In my opinion, the above stories suggest that we aren't doing so well. We don't have the experience needed. I am worried about our remaining best chance at good things. That would be Bay View, and the developer, Kent Donahue. We are poised to really screw it up if someone from the city doesn't get their head back outside in the sunshine. The one thing Kent Donahue knows how to do is develop property. He is well thought of in the development community. He doesn't need any rank amateurs to help him.
I want to give kudos to "officialdom" for helping to put the Bay View deal together. However, if we screw up Bay View like we did North Shore, The Villages, Homestead, the hospital muscle job, and Form Base Codes, we deserve everything coming our way.
Next post.........The people of Rowlett.