Lisa Falkenberg, who I've never met or talked to other than in one email, wrote this piece the other day.
My apologies for not getting a chance to address sooner; I've actually been trying to work on something meaningful that benefits everyone in our community, so answering socio-economic discrimination innuendos hasn't been highest on my priorities of 'venting outrage on blogs.' (You don't have to click on it ... I just linked it back to this blog - I am very outraged) (that was kind of passive aggressive sarcasm).
Anyway, I guess we can just kind of go point by point here, so here we go:
The blue protest signs peering through iron gates of faceless town homes a few blocks away don't come this far down Koehler Street.
If they want a sign, they can email info@stopheightswalmart.org, and I'll get them one. Typically, we ask for a donation, but it doesn't matter if you can donate or not.
I've made a point not to be 'faceless' since as close to day 1 as possible. I called Walmart directly to ask questions, I attended my local civic club and super neighborhood meetings to listen and get more information, and I called my councilman, and was invited to an early meeting with the developer and other local civic members to talk more about the development. Thats where I met Michael Ainbinder for the first time. At the conclusion of that meeting, and perhaps his memory will be foggy by this time, I shook his hand, and told him that I understood that he had made an investment in that property, and that I had also made an investment in my home, and would do whatever I needed to to protect my investment. Maybe he didn't believe me, I don't know. Anyway ...
Along the way, I and others in our organization have met numerous other reporters, given dozens of interviews to the media, and have made numerous visits to other local area civic clubs and homeowners associations to be out there in our community to answer questions, both for and against. If I missed you at any of these engagements, then my apologies.
Down here, where mostly tenant shacks and aging frame houses line frayed ribbons of shoulderless streets, you won't find many of the folks who are signing coffee shop petitions, or venting outrage on blogs, or donning red T-shirts at raucous City Council meetings.
I actually wore a red polo to the first meeting. But beyond that, you make an important point very eloquently ... 'frayed ribbons of shoulderless streets' ... I completely agree. Thats why on Wednesday, in our meeting directly with the mayor, we advocated for further improvements to our neighborhood overall (See page 9). Unfortunately, you don't find those things in the present form of the 380.
What you do find is a private entity benefiting from public money at a ridiculous profit for right of ways. This is just one of the concerns we've put out there about the agreement overall. See page 7, where we state:
The City is obligated to pay Ainbinder 1.035 million for the acquisition of the right of way for the
Koehler extension. That is a cost of 58.08 per sq ft. The county tax authority has appraised the
land at the Heights Plaza apartments at 22.50 per sq ft! Improved property in the area generally
has a market value of 38 per sq ft. The profit Ainbinder is making on this sale is astronomical. If
Ainbinder is not willing to significantly reduce this amount, the City should eliminate this from the
380 agreement and take the land by eminent domain. The City is potentially overpaying by half
a million for this acquisition.
Essh ... who wins there? The public?
You'll find folks like Betty Allen, a truck driver in an army green Dickey's button-down who grew up in this corner of Houston's West End neighborhood and has owned her white 1,200-square foot house for a quarter of a century.
For the past two years, Allen says, she's been out of work and on worker's comp due to a back injury, and she's learned what it's like to struggle after many years on a comfortable trucker's salary.
In many ways, she lives in a different world from the young, newcomer hipsters walking fluffy dogs and sealing their polished SUVs each evening behind seamless garage doors.
And when it comes to the proposed Walmart a block down her street, Allen has a little different perspective than some of her more vocal neighbors.
"I've been living here for 58 years, and I wish it would come on," she says.
She says she's not the only one. Many of her neighbors, especially the seniors living on fixed incomes, aren't as worried about the traffic and the crime that Walmart opponents predict will accompany the new development as they are finding an affordable place to shop, she says.
I've been to the West End Civic Club meetings. I've walked the blocks, done the mailers for the neighborhood. We've collected and delivered the community's suggestions to the mayor. And lets just be honest here; while I'm happy that the mayor came to my house last weekend, and we had a good serious talk about the roads in the neighborhood (which benefits everybody), we've realistically gathered more feedback to help the city than one block walk on a Saturday could have. Again, it was to support a responsible development.
Koehler (Its overgrown ...we call 311 all the time).
"The poor people, that's one way they can pull up," Allen says. "The little money they have left they can put it toward rent or something."
She and others who want to shop at Walmart now have to drive 10 miles up 290 or almost as far up Gulf Freeway.
Obviously, not for long with the 3 pronged Walmart approach within a 6 mile radius. But beyond that, its not needed. Here (again) is the economic study that was made wholly possible by supporters of RUDH. And while some criticize the study, the city nor the developer have really not had an answer ... because they know the specifics of the study are correct, and applicable. The reason why we went to Civic Economics is because of their body of work, which has included in the past, Walmart.
And lets not kid ourselves here. Walmart is no savior of the universe. Even critics agree, they're not even the cheapest game in town anymore, despite their ad campaigns.
Good for neighbors
Farther up the road, 50-year-old welder Alfonso Casillas had a similar sentiment: "The store esta bueno for me," he said with a laugh. "The people who live in this neighborhood, they need Walmart. The ones who are against it, they don't need it. They can go to the Galleria or other places."
Casillas, who said he'd lived in the area 30 years and rented his West End duplex for five years, seemed perplexed by the controversy: "Los blancos," he said, shaking his head. "I don't know what their problem is."
Lately, Mr. Casillas, neither do I.
Here's where I get perplexed. If a reporter wants to make a statement like this, then do it. There's no reason to rely on innuendo. I know what the perception is ... yes, we've heard it. Thats part of what happens when you go public. You get called nasty names, you're judged, mocked, ridiculed, etc ... I've been told that I'm going to hell for speaking out for my neighborhood (that was fun).
I don't take this stuff personally ... really, I don't. Anyone that actually sits down to talk to me can figure that out pretty quickly. I just kind of sort of don't get it when folks don't ask comprehensive questions.
Here's my thing though ... where's Ainbinder in this. Where's the city? Why is it that Ainbinder gets a free pass. These guys exist to make a profit. These guys don't develop land for free ... they're not doing this as a favor to you, or to the neighborhood. If Ainbinder wanted to be so kind, they would refurbish all of the older homes in the neighborhood, and donate them to those less fortunate ... it would still be cheaper than the 380.
Put this in perspective; they want to sell the land to a retailer to make a profit, and they want to use public money to help them do it (See above comment). I don't care where on earth you come from, as its written, its not a fiscally responsible deal, and the public gets promises ... and how many promises has this city seen broken from government, much less corporations.
I'll probably get banned from my favorite Heights coffee house for saying so, and it's not that I'm a fan of Walmart. Some of their business practices led me years ago to avoid shopping there if I can avoid it. I'm fortunate enough to have that luxury.
But the campaign to stop developers from building the Walmart-anchored shopping center at Koehler and Yale seems more out of touch the louder it gets.
We keep hearing from the folks waving the "Stop Heights Wal-Mart!" signs that the development doesn't jibe with the Heights vibe. I'm not entirely sure what this means anyway in the context of a our zoning-free, free-market-free-for-all crazy quilt of an urban landscape.
Maybe if you visited the StopHeightsWalmart website you might have found far more substance than what you've chosen to include. Hell, we even have a link for a super eco WM Store that was built in McKinney (A suburb of Dallas - and in all fairness, this just went up on the 16th). Just about anything is going to be better than the standard design they've presented. (really Ainbinder? 15 cars in a WM parking lot in the middle of the day? C'mon now). Nothing groundbreaking, just more of the same ...
But I'm almost certain that some of the other structures nearby — that looker of a climate-controlled self storage facility, for instance — don't meet the definition, either. And the site in its current state certainly doesn't: it's an overgrown lot enclosed in a razor wire-rimmed fence sprouting with a fringe of runaway weeds.
Ask Ainbinder why thats the case, or the city for that matter. We've called 311 on their overgrown drainage ditches numerous times, yet no one's making them do anything about it.
Improvements promised
Then there's the fact that the site isn't even in the Heights. It's the West End, or what's become the Washington Corridor, or Super Neighborhood 22, if you will, but not the Heights. We're not talking about tree-lined streets of reborn bungalows and mom-and-pops. The area has been industrial for decades, at least according to long-timers like Sarah Hunt at San Jacinto Stone, across the street from the site.
She supports the Walmart, too, by the way. Finally, she says, someone to mow the grass regularly, in addition to all the other improvements developer Ainbinder Co. is proposing: a bike and pedestrian trial, widening and repaving streets, improving drainage, among others.
... and legal fees, and land at double the value, and drainage retention that they would have to put in anyway that won't go to the city's control because it will still be on the WM Land ... yadda yadda yadda ... I'm sure you've read the 380 front to back. In case you haven't, again, here you go ...
Ah shucks, I don't want to ruin the fun of actually making an effort to read a document that we just threw together without any real work on it or anything, but in case you don't have the time to go download it, etc, so here we go ...
SECTION 2 – Responsible Considerations and Recommendations
• Typically, developers are responsible for infrastructure upgrades that will only serve the
development. Infrastructure upgrades that are for the public are typically funded by the
municipality, if such funds are available. And anything in between the two is usually split between
the municipality and the developer based on negotiations over whether the improvement is more
or less for the developer’s benefit than the public. This 380 agreement throws that all to the wind
and obligates tax payers to fund everything regardless of whether it is solely for the purpose of the
development. At the very least, the City should determine what improvements are solely for the
benefit of the developer and require the developer to pay for those improvements. This would
mean that the cart has to go back behind the horse. The developer should be required to have
approved plans before the 380 agreement is negotiated so we can know for certain what
infrastructure improvements will actually be required and what improvements the developer
should have to fund.
• The developer’s obligations under the agreement are illusory. At best, this is an executory
contract. In the simplest terms, that is a contract where no one is obligated unless one party
performs (ex. if you mow my lawn, I will pay you $10). The developer is not obligated to build
anything and, if the developer does build, is only obligated to put up 75,000 sq ft of retail, with at
least one anchor tenant. As noted above, the developer should be required to commit to
building the entire project in order to be entitled to any public money. Anything short would put
the tax payers at risk for insufficient tax generation from the development.
• The developer’s obligation to build infrastructure improvements is partially illusory. The developer
has discretion to nix any infrastructure improvements that are not required by permitting and
code. Thus, if the infrastructure upgrades go over budget, the developer has the right to throw
out the esplanade improvements, improvements to West Side Park and the bridge improvements
as these are not needed for the development. The developer should be required to complete all
improvements.
• The requirement to issue bonds and pay within 15 months of the opening of the anchor is a typical
provision in an agreement with a Municipal Utility District (“MUD”). MUDs have the ability to issue
bonds without needing tax payer approval. The City of Houston does not. Thus, this provision is
inappropriate and potentially a major liability for the City if the development fails and there is no
tax revenue. The developer should bear the risk of repayment solely out of tax revenues. The
City’s repayment obligation should be limited to 10 years (as required by ordinance) and to tax
revenue collected.
• The developer is able to bill the city for its attorney’s fees and time incurred in preparing and
negotiating the 380 agreement with the City. This will be part of the “Soft Costs” and
“Contingencies” in the itemized list. More importantly, 20% for soft costs and contingencies is
grossly inflated. 15% is considered very high in the industry. Furthermore, the City has its own staff
that can handle the supervision of the project instead of paying Ainbinder a hefty profit to have
his people do the work. The City knows how to build roads. The percentage for soft costs should
be cut to at least 15%. This would save the City almost a half million dollars. If City staff worked
the project, the percentage could arguably be dropped to 10%, saving tax payers almost a
million dollars.
• The interest reimbursement is a terrible deal for tax payers. Interest is only limited by State usury
laws, which do not apply to many National lenders. More troubling, Ainbinder could simply loan
the money to himself by having his development company loan money to the special purpose
LLC. Given that the cap on bond finance charges is 5%, the developer could potentially charge
double that rate. Over ten years, this could cost the City 1.6 million dollars! The developer should
bear the cost of financing. The developer is getting timely improvements at the tax payer’s
expense. The developer needs to have some skin in this game. It would also incentivize the
developer to build more and faster to maximize tax repayment. At the very least, the interest rate
should be capped at 5%.
• The total amount of the contract is capped at 6.05 million. However, the City Development
Director has absolute discretion to increase this amount by agreement with the developer. This is
a blank check! The contract cap should be absolute. The developer has no incentive to stay on
budget. If the developer cannot build on budget, the developer should have to come back to
City Council for a supplemental agreement.
• The City is obligated to pay Ainbinder 1.035 million for the acquisition of the right of way for the
Koehler extension. That is a cost of 58.08 per sq ft. The county tax authority has appraised the
land at the Heights Plaza apartments at 22.50 per sq ft! Improved property in the area generally
has a market value of 38 per sq ft. The profit Ainbinder is making on this sale is astronomical. If
Ainbinder is not willing to significantly reduce this amount, the City should eliminate this from the
380 agreement and take the land by eminent domain. The City is potentially overpaying by half
a million for this acquisition.
• The contract states that it controls over any conflicts any City ordinance or regulation. This
provision is backward. City ordinances should control over any conflicts with the contract. The
City should never contract away compliance with its ordinances.
• Ainbinder should not be reimbursed for on site drainage improvements. This is nothing more than a
transfer of public money to private hands. Furthermore, the cost for this is roughly equivalent to
the cost of improving the esplanade, bridges and park. Thus, the City has given the developer
dollar for dollar what the community gets, except that the tax payers pay for all of it.
• For all the tax payer money being spent for infrastructure improvements that solely benefit the
development, the developer has no real obligation to do anything on site. The developer is
merely asked to “endeavor” to build in the architectural style of the Heights. This requirement is
virtually unenforceable. The developer should be required to submit architectural plans to the
HAHC for approval and should be required to build 100% according to those plans. Also, for all
that the developer is getting from the tax payers, the developer should be required to do much
more on site than an appropriate facade. There should be enforceable requirements for low
impact development practices, trees, green space, walkways and so on. RUDH has submitted to
the City what it believes should be incorporated in the 380 agreement.
• The City has no protection in case the developer becomes insolvent and has only partially
completed improvements. The City should be granted a first priority lien on the development for
the cost of completing any improvements that the developer may fail to complete for any
reason.
• Finally, the Chronicle’s editorial in support of the 380 agreement incorrectly claimed that the
operating agreement with Walmart was part of the 380 agreement. It should be. Otherwise, the
operating agreement has no real teeth. Walmart should be a signatory to the 380 agreement
with monetary penalties to be taken out of tax reimbursements for failure to abide by the
operating agreement.
The refrains from the anti-Walmart folks seem to center around traffic, and trucks and crime and light pollution and China. And I'm sure there are some valid points in there somewhere, although I know the Target on Shearn Street has been known to draw a few cars, emit a little light and sell one or two products from China. Yet, a quick check of the Chronicle archives revealed hardly a blip of opposition when it was built several years ago.
This is getting to be one of my favorite arguments ... why didn't you oppose the Target on Shearn ... thats a simple answer ... because then my blog name wouldn't have made sense.
Civic engagement is a good thing, and the cause my fellow Heights residents are rallying around may improve the project, and strengthen their neighborly bonds in such a unique corner of Houston.
But as the volume rises, let's remember that not everyone is against the so-called Heights Walmart, especially those who need it. Lets also remember that its easy to lob criticism from behind a computer screen ... but it takes a bit more effort to actually make some recommendations that are good for the community and our city.
I'm actually not a heights resident ... as the blog name states, I live on Koehler street, which is in the West End. But I've met a lot of people in all this that I'm really happy to have met, and that I hope we'll be able to maintain lasting friendships with. Thats been the best part of all of this ... I've actually discovered a community that has a concern for whats happening around them, and doesn't sit around and wait.
We've asked for the city to defer the 380 ... use it to make sure everybody gets something ... as it is right now, there's no teeth, no enforcement. Take a look at that list we gave to the mayor. Look at what's detailed there and presented. There's something for everybody. SWA Group was kind enough to help with a concept idea (shown above) ... and it includes a big box design.
The blogosphere is one thing, but these are issues, big issues that will effect us, and the city, for years to come. Lets stick to the substance that makes a difference here.
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