New Purl Elementary School to Cost $262/sq ft

Perhaps the City needs to contract with Georgetown ISD for the construction of the new city hall. Georgetown ISD is demolishing and removing asbestos from the old school and building a brand new 116,000 square foot elementary school for $30.4M. For those who care to do the math, that is $262/sq ft.

Compare that with the $13.0M for the city hall at $355/sq ft for 36,600 sq ft. For anyone who believes the $13.0M final cost, there is a bridge in Brooklyn for sale at a very reasonable cost!

In fact it is even worse than that. To demolish the old library and communications buildings, the City estimated the cost to be $20.936M which is $572/sq ft. Something is seriously wrong with the city's cost estimates.

A call is repeated to establish a citizen review board of knowledgeable development/construction Georgetown taxpayers to review proposed plan before Council commits to proceed and monitor construction as it progresses.

Military Intel Confirms Terrorists Coming Across Texas/Mexico Border

"A U.S. military intelligence report discloses that Muslim terrorists are being smuggled into the country through Mexico. The government calls them Special Interest Aliens (SIA) and Latin American smuggling networks are helping them cross the border, according to information obtained from a U.S. Southern Command (SOUTHCOM) Intelligence dispatch."Judicial Watch

Even though there have been no public reports of terrorists in the Georgetown area, it would be prudent to be alert at all times to the possibility that terrorists are in the area.

Beware of Election Fraud

It has been widely reported that the FBI has uncovered evidence that foreign hackers penetrated two state election databases in recent weeks, prompting the bureau to warn election officials across the country to take new steps to enhance the security of their computer systems, according to federal and state law enforcement officials. Yahoo News

But much closer to home there is an ongoing lawsuit alleging illegal actions in the last Austin city council election.

"Keith Ingram, Texas Director of Elections, has recently issued rule changes that waive any requirement to store the ballot images of votes cast on electronic voting machines in Texas.  Earlier this year, a lawsuit filed by Dr. Laura Pressley contesting the election results for an Austin City Council race was heard by the Texas 3^rd Court of Appeals, where it continues to be held without a decision six months following its oral hearing.

The lawsuit exposed multiple voting irregularities in Dr. Pressley's election for City Council.  Dr. Pressley, a 17-year veteran of the semiconductor industry, used legal discovery to access computer logs of the main tally computer in the Travis County election office.  There, she found the computer counted more votes than registered voters in 10 of the 12 precincts forming her district.  One precinct had 100% voter turnout, the other had all but 2 registered voters participating in an election that had only a  32% and 17% county-wide turnout in the general and runoff elections.

Dr. Pressley's legal discovery further documented that Travis County could not produce any ballot images as required by Texas statutory law to properly conduct a recount.   The computer logs further documented multiple "corruption/invalid" errors while reading the Mobile Ballot Boxes (MBBs).  MBBs are memory cards that store precinct vote tallies and images of the ballots Texas voters cast when using electronic voting machines.  These "error" alerts are a signature for election tampering / vote-hacking, and procedure requires these cards to be quarantined for forensic analysis, which never happened.

Dr. Pressley's original case was summarily dismissed by Dan Mills, a Republican judge voted off the bench in firmly Republican Burnet County, claiming she had no evidence for election irregularities.  Judge Mills further sanctioned Dr. Pressley and her legal team $90,000 for daring to contest the election, though an offer was later made to withdraw the sanctions if she withdrew her lawsuit.  She refused.

The Travis County Democrat Party has been financing the legal opposition to Dr. Pressley's lawsuit.  Their defense has claimed Travis County was within its rights to violate Texas election law through an advisory issued by Mr. Keith Ingram (a Republican) over the Secretary of State's website that eliminated the need to keep or post voting tapes at each precinct after the polls calls. This practice serves as a measure that allows the public to audit the state records, which Dr. Pressley had to sue to get.  Travis County had no argument for the lack of ballot images needed to conduct a recount, and no one specifies where a single bureaucrat has the authority to overturn Texas statutory law.

On Super Tuesday, I served as an official poll watcher monitoring the Travis County central tally computer and witnessed multiple irregularities, tantamount were the "corrupt/invalid" alerts signaled with the first batch of MBBs read by the computer.  Though I brought this to the attention of all election officials from the Clerk to the Administrator, the corrupt/invalid card was not quarantined for forensic analysis to assure a lawful election.

Now Mr. Ingram, who works for Governor Abbott, attempts to rush through bureaucratic rule changes that bury within a waiver to store ballot images--the clear smoking gun in Dr. Pressley's case, which since last February, remains without a decision from the 3^rd Court of Appeals.

Is popular opinion right that we have a "rigged system", wherein Establishment Republicans work in collusion with Machine Democrats to thwart the will of the American People?   It is beginning to look that way in the reliably Red State of Texas.  Heaven forbid what is really going in the Battleground States!"  Austin Election Fraud

Why Did Georgetown Receive a Low Price Quote for Solar Energy??

The answer is quite simple...massive taxpayer subsidies.  A wealth transfer scheme to take money from all U.S. taxpayers and funnel the money to cronies with the remainder allocated to the purchasers of the electricity, if they ever see the promised solar generated electricity. SunEdison Failure

According to National Review, SunEdison received $1.5 billion in subsidies and loan guarantees.  On top of direct Federal subsidies of $400M, SunEdison also received $846 million in federal loans, loan guarantees, tax-exempt federal bonds, and federal insurance. The total government support for SunEdison comes out to $1.5 billion.

The Wall Street Journal is reporting that shareholders won’t get an official voice in the bankruptcy of SunEdison Inc. because the company is “hopelessly insolvent,” with debts outweighing assets by at least $1 billion, a bankruptcy judge has ruled.

At a court hearing August 11, SunEdison lawyers said the company is working on a business plan that could lead to a reorganization around assets that aren't sold in bankruptcy. Some of the solar power company’s projects have been sold, others are going up for auction, and talks are under way about finding a buyer for SunEdison’s control stakes in two separate public companies, TerraForm Power Inc. and TerraForm Global Inc.

When are the citizens of Georgetown going to find out if the proposed solar power plant under construction by Buckthorn-WesTex, a SunEdison subsidiary has been sold or if they have secured financing to restart and complete the project? 

Is there a secret Georgetown plan to provide funding to Buckthorn-Westex to complete construction of the Ft Stockton solar power plant?  Inquiring minds want to know.

National Pension Crisis Update

The Illinois Teachers Retirement System, the state's largest pension fund which is only 41.5% funded: cut its existing future returns assumption from 7.5% to 7.0% (which was previously lowered from 8.0% in 2014. The state government would be on the hook to make up the difference caused by lower assumed investment rate of return, estimated to cost an extra $400 million to $500 million a year.Illinois Teachers Retirement

Sadly, in a world of low returns, there is no simple solution; in fact, it is an "unsolvable math problem" in a world of Zero interest rates(ZIRP) and Negative interest rates(NIRP), and as the Chicago Tribune said "Taxpayers would be hit either way; the question was whether it would be in the short term or long term."

Illinois decided to take the short-term hit on the budget, and thus taxes, instead of kicking the can further down the road while the severity of the problem dramatically increased. 

Will Georgetown learn from others mistakes?

Rail Revival?

Are the proponents of rail service between Georgetown and San Antonio trying an "end run" to reinstate LoneStar Rail under another name and management structure?  Cynics certainly think so!

By establishing responsibility for rail with TxDot, AAMPO, and CAMPO, funds for new toll lanes on I-35 could be co-mingled with rail funds to hide from the public the cost of rail.  Advocates for government transparency and no toll roads in Texas will be fighting this blatant attempt to reinstate rail between Georgetown and San Antonio!

Here is the resolution passed by Bexar County and supported by CAMPO Chairman Will Conley.

NOW, THEREFORE BE IT RESOLVED that the Bexar County Commissioners Court: 

1. SUPPORTS THE ALAMO AREA METROPOLITAN PLANNING ORGANIZATION’S CURRENT RULES IN PLACE CONCERNING SPENDING OF SURFACE TRANSPORTATION PROGRAM – METROPOLITAN MOBILITY FUNDS. 

2. SUPPORTS TRANSFERING LONE STAR RAIL DISTRICT’S CURRENT RAIL PLANNING DUTIES TO THE ALAMO AREA METROPOLITAN PLANNING ORGANIZATION AND THE CAPITAL AREA METROPOLITAN PLANNING ORGANIZATION WORKING IN COOPERATION WITH TXDOT.

3. SUPPORTS STUDYING THE FEASIBILITY OF UTILIZING THE I-35 CORRIDOR FOR RAIL IN COMBINATION WITH FUTURE ROADWAY EXPANSION. 

PASSED AND APPROVED by Bexar County Commissioners Court in San Antonio, Texas, on this 23rd day of August, 2016, in Bexar County, Texas. 

National Pension Crisis

A pension crisis is occurring right now around the country for specific pension funds.  Detroit comes to mind as well as Chicago.  Most of the issues are with public pensions, of which Social Security is the largest.  Of course current payments into Social Security are being used to fund current recipients.  This will not continue for long as more and more people retire and fewer workers are contributing.

The main issue with viability of public pensions is the assumed rate of investment returns. On August 1, the American Academy of Actuaries and the Society of Actuaries shut down a 14-year-old task force on pension financing when several members were about to publish a paper that found many state and local retirement systems calculate their obligations using overly optimistic future rates of return.  The task force concluded that the assumed rates of return artificially improved the projected ability of the funds to meet their obligations.  The AAA and SOA threatened members of the task force if they independently published their analysis.

Private pensions are in somewhat better condition since they are required to use a "risk free" rate of return based on U.S. Treasuries to project the future growth of their assets.  Public pension funds can pick an arbitrary higher rate, which they often do.  Government pension funds on average estimate they will earn 7.6% annually.  Elected officials, otherwise known as politicians, adopt overly optimistic rates of return that allows them to offer public employee benefits that seem affordable and attractive.

More analysis is available in today's Wall Street Journal.

Pension Update

The Texas Municipal Retirement System(TMRS) continues to struggle to meet its investment goals.  Through June 30, 2016, the total fund earned 3.29% since January 1, 2016.  This is still a far cry from the assumed 6.75% annual return.  TMRS calculates they are 84% funded when the assumed investment return is 6.75%.  If actual return rates were used, such as the 3.29% earned this year, the funding ratio would be much less than 84% which means the City, the employees, or both of them would have to increase their contributions to maintain the current formula for calculating retirement benefits.

TMRS continues to diversify its investments into riskier assets with higher fees in search of higher investment returns.  They recently approved adding $100,000,000 to private equity.  Private equity managers cannot be trusted, yet, pension funds continue to invest. The U.S. Securities and Exchange Commission told them so two years ago, when it reported that the majority of buyout fund managers were cheating investors with excessive and undisclosed fees. Since then the agency has repeatedly settled with funds it has accused of defrauding investors, including a $30 million settlement with KKR in June 2015; another for $39 million with Blackstone in October; and one for $52.7 million with Apollo Global Management on Aug. 23. (The firms didn’t admit wrongdoing.) Link

The City needs to seriously look at its participation with the TMRS pension plan(defined benefit) and either increase the contributions to the plan or convert to a defined contribution plan similar to the 401K used in private industry.  It would be better to act before there is a crisis.

City Council Spending on New City Hall OUT-OF-CONTROL!

After the City staff presentation July 26 on the new city hall project to the City Council, known as Downtown West, at which it was disclosed that the estimated cost had ballooned from $6.5M to $13.0M, the council evidently directed the staff to do the following:

• Renovation Plan that is Worthy of our City and Exemplifies our Values

• Cursory Review of Demolition and Reconstruction

• Funding Strategy • $13,000,000

Thus, the Council blindly accepted a doubling in cost for the project!

On August 23, the City Staff reported back to the Council.  Renovating and adding to the existing buildings, the old library and communications building, would cost $13.0M  That includes $10.5M of construction costs at $285/sq ft and $2.5M for contingencies and outfitting the buildings.

Demolition of the old buildings and replacement with new construction was estimated to cost $20.936M.  This estimate was based on $25/sq ft demolition costs and $300/sq ft new construction costs.  Needless to say, this was a non-starter with the Council.

Under the $13.0M plan, 36,600 sq ft of space will be realized at a total cost of $13,000,000/36,600 = $355/sq ft.  For comparison purposes, the city spent $29.3M for the Public Safety Building, 76,000 sq ft at a cost of $385/sq ft.  The new Westside Service Center, due to open shortly, cost $377/sq ft for 11,000 sq ft.

The last three schools that Georgetown ISD constructed has cost an average of $145/sq ft for construction costs according to the Texas Comptrollers website.  Clearly, Georgetown’s building costs are out of line with school building costs in Georgetown and around the state.

So it seems the Council and City Management have their heads “Up and Locked” as they directed the staff to proceed with the $13.0M plan.  It is full steam ahead without regard to the costs!  Keep in mind that these costs are purely estimates and experienced project managers will tell you to expect cost growth of up to 100% by completion.  Cost estimates have already doubled from $6.5M to $13.0M.  Just go back and review the initial estimates versus the final cost for the last two city building projects for guidance.

Rational taxpayers would ask the following questions and demand rational and reasonable answers before proceeding.

1.    Why Now?  What is the urgency?

2.    Why not sell the old library and communications buildings and use the proceeds to build new in a different location if it would save multi-millions of dollars?

3.    Establish a series of project off-ramps if cost targets are not being met

.

4.    Establish in priority order the items to be eliminated as costs exceed planned expenditures.  For example, complete the old library renovation and construction before starting on the communications building.

5.    Why not establish a citizen review board of knowledgeable development/construction Georgetown taxpayers to review proposed plan before Council commits to proceed and monitor construction as it progresses?

It is time for the citizens of Georgetown to get involved with their Council and City Management to let them know keeping City spending in check is a priority!

Zoning, Building Codes and Politics Affects Housing

Affordable housing is impacted by many elements among which are land use regulations, building codes and politics.  A recent Study indicates that land use restrictions and building codes tend to drive housing prices higher with more amenities. Democrats tend to want these amenities while Republicans do not.  This results in communities becoming more Democratic politically which results in more government and government regulation which increases housing costs ad infinitum. In other words, Democrats, on balance, seem to be willing to pay a higher premium to live in heavily zoned communities, while Republicans would rather live somewhere with fewer amenities at lower cost.

Housing becomes less affordable and rents will continue to rise faster than inflation; upper-middle class communities will continue to pull the ladder up for upwardly-mobile young families; and the community's economy will continue to be artificially suppressed because it is difficult for workers without means to move places where the job market is hot.

The City Council needs to take a close look at what policies or lack of regulations actually makes housing more affordable before jumping off half cocked and imposing policies and regulations that actually make housing less affordable and at the same time turns the city Democratic.

Three Affordable Housing Projects Approved

The following excerpt if from Councilman Foughts newsletter.

Affordable Housing

We have addressed this subject almost ad nauseam in this newsletter, so let me hit the bottom line first:  All three projects were approved by the Texas Department of Housing and Community Affairs (TDHCA).

Now, let's backtrack a bit to get a grasp of what has happened.

The three proposals ( Kia Pointe,  Pedcore/Live-Oak, and Merritt Heritage) were dependent upon competitive low-income housing tax credits (HTCs) administered by TDHCA and conventional debt. Texas law requires the governing body of communities that have more than twice the state average of housing tax credit units per capita to pass a resolution supporting the allocation of housing tax credits to a proposed development.  

The reason these proposals came before the City Council was to gain that approval.  If a proposal gained an affirmative vote, it is passed forward to TDHCA'S board and competes against other applications from other locations.

It is important to note that Williamson County has just slightly over the average number of these units, but nearly 2 times more than neighboring Milam and Bell County.  Georgetown has nearly 3-times the state average and several of the nearby communities have considerably less than the state average number of these units, and Jarrell has none:

• Georgetown has 2.77 times the state average
• Pflugerville has 2.27 times
• Austin (center) has 1.84 times
• Cedar Park has 1.80 times
• Leander has 1.48 times
• Round Rock has 0.78 times (i.e., less than the state average)
• Hutto, has 0.33 times
• Jarrell has no units of this type.

During the opening discussions, we were advised that Georgetown would be fortunate to get one of the three proposal approves because the process was highly competitive.  As time moved on, we were advised that Georgetown might even get two of the proposals approved.  As things played out, all three were approved.

I voted against all three proposal for reasonsI expressed repeatedly in Council meetings and in this newsletter.  My fundamental reason for opposing these proposals was because the City Council had not yet had an opportunity to think the issue through, develop a sound, reasoned policy on Affordable Housing, and provide guidance to the Staff.  Instead, we were being "pushed" against a developer-imposed timeline. I was the lone Council Member voting against all three measures; my letter reflecting those objections can be viewed by clicking here.

The approval of all three applications begs the question: If all of the units associated with the proposal were added to Georgetown's current inventory, what would be our ratio to the state average, and are there other cities of similar size who have greater ratios.   The answers are:

• Georgetown would have 3.47 times the state average;
• Only two other cities would have higher ratios (San Marcos at 4.22 and Port Arthur at 4.59).

My bottom line is that I opposed all three of the proposals, argued as best I could, but did not convince my colleagues on Council to delay these decisions until the Council had time to give guidance to the Staff.  So be it.  Now my job is to support the decision and move on to other things -- which I will do.  

However, I expect more of these requests to come forward -- and I'll keep you posted as they do.  So stay tuned.

Al, The Charlatan, Gore visits Georgetown

Charlatan - "A person who falsely pretends to know or be something in order to deceive people".

The former Vice President, Al Gore, visited Georgetown on Sunday. Wilco Sun

Georgetown's Mayor did not do himself nor the City any favors by fawning over the former VP citing his Nobel Peace Prize and commitment to environmentalism.

The Wilco Sun did not burnish its image with the citizens of Georgetown as they reported all the positive aspects of "green energy" without disclosing all the negative elements.

For instance, it was not mentioned that "green energy" is a gigantic wealth transfer scheme wherein money is taken from all the taxpayers and given to select companies through grants and tax breaks.  This allows "green energy" rates to be lower - read subsidized - for those consumers that have access to solar and wind generated electricity at the expense of all tax payers and other energy consumers.

A specific example of wealth transfer is the Westex solar farm under construction near Ft Stockton that receives property tax relief from the local government and school district.  Therefore, wealth is transferred from the taxpayers of Pecos County to the consumers of Georgetown.  It should be noted that it was reported here recently that construction on the solar plant has halted due to a lack of funding and SunEdison is requesting bankruptcy court approval to sell the project to generate funds to pay creditors.

In 2006, Gore released his movie "An Inconvenient Truth" with all kinds of dire predictions that would befall the earth if fossil fuels were not banned.  Well, its 10 years later and most of the predictions have been proven to be wrong. Predictions  In the mean time Gore has amassed enormous wealth from the movie, speaking engagements and investments in "green energy" companies that benefit from government policies.

Georgetown can indeed note that the former Vice President's visit was "historic" as noted in the Wilco Sun.  It is not often that Georgetown is visited by a charlatan of Mr, Gore's stature!  It is certainly not an honor.

Property Taxes Continue to be an Issue in Texas

Property tax bills continue to increase at a rate far exceeding population plus inflation rates of increase.  Politicians, including those on the City Council, like to tout the fact that property tax rates are being held constant, but, because of inflated property values, tax bills continue to increase.

Some Texas legislators recognize the problems with the local taxing authorities building monuments to themselves with tax dollars instead of spending and taxing in the best interest of the property tax payer. Property Taxes Trigger Growing Social Crisis in Texas

It seems time for state legislators to consider some kind of cap on the annual increase in property tax bills, since it is apparent that local taxing authorities will not limit property tax revenues on their own.  The cap needs to be imposed on tax bills so that politicians cannot continue the game of holding down tax rates and blaming the tax assessor for the increase in tax bills.

A California Proposition 13 like cap would work quite well in Texas as it has in California.  California politicians continue to try and eliminate Prop. 13 even though property tax revenue has increased faster than inflation since 1978.  Since Prop 13 was a constitutional amendment passed by the people, the politicians have been unsuccessful in repealing or watering down the impact of the proposition.

Latest on SunEdison & Buckthorn-Westex

The latest info on the SunEdison bankruptcy comes from sources other than the City of Georgetown. Why is the city not forthcoming with this information? Demand transparency! Buckthorn-Westex is the subsidiary of SunEdison that holds the contract for solar energy with Georgetown.

The city council is discussing tonight in executive session at the regular council meeting. Tell your council person thaat you want to know what is going on with Buckthorn-Westex!

SunEdison looks to sell Buckthorn PV project in Texas

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RELATED

• SunEdison urges sale of Mt. Signal 2 project to D.E. Shaw: report
• Pattern finalises acquisition of SunEd's 600MW King Pine

By Richard A. Kessler in Fort Worth 

 Thursday, July 21 2016

Updated: Thursday, July 21 2016

SunEdison, which filed for bankruptcy protection on 21 April, has asked creditors for permission to sell the 150MW Buckthorn PV project under construction in West Texas as part of a package of renewable energy assets it wants to divest.

“I know exactly who they are trying to sell it to, but I am not allowed to say legally,” says an official familiar with the sales process. “There is actually more than one party that has a bid on it. That may be what the hang-up is with the creditors, as there are multiple people looking at the project as a valuable asset that want it.”

SunEdison declined comment.

SunEdison had earlier tried to sell Buckthorn along with several wind farm assets in Colorado, North Dakota and Texas to an affiliate of Novatus Energy, a portfolio company of JP Morgan’s Infrastructure Investment Fund.

The US Bankruptcy Court for the Southern District of New York did not allow the Buckthorn sale to go forward because the limited liability company - Buckthorn Westex LLC - that is building the project had not declared bankruptcy, according to the official.

The project is located in Pecos County, the heart of Texas' emerging utility-scale solar development that is drawing interest from global investors. 

Last year, Buckthorn gained national attention when SunEdison signed a 25-year off-take deal for the project’s entire nameplate capacity with Georgetown, helping it become the first city of any appreciable size in oil-drenched Texas to embrace renewable energy for all its power needs.

That decision was even more notable as city officials and residents are largely conservative Republicans, who generally oppose President Barack Obama’s climate-change and environmental initiatives.

Instead, the city made the move to go solar (and wind) on cost and as a long-term hedge against volatility of natural gas prices. Georgetown’s contract calls for initial deliveries of power in late April 2017.

SunEdison originally financed the initial rounds of construction for Buckthorn with plans to sell the facility upon completion to its yieldco TerraForm Power. It got an early start on construction but financing ran out several months ago, forcing the beleaguered developer to look for third-party sources as worksite activity ground to a halt.

Since then, continuing efforts to arrange financing have been complicated by the company's bankruptcy. In normal circumstances sale of Buckthorn would have taken little time as it is an attractive asset with guaranteed long-term cash flow from a creditworthy off-taker.

Even though project construction is not advancing, Georgetown does not see it as delayed from a “contract standpoint,” since the SunEdison subsidiary still has a window of opportunity to complete financing and get it built to meet the power delivery schedule.

“In a perfect world, if they had never gone bankrupt,” SunEdison could have had Buckthorn operational as early as October, the official says.

Meanwhile, industry talk continues that SunEdison also wants to sell its 116MW Castle Gap PV project in West Texas. This project has a contract to sell its power to Luminant, which is the largest utility in the state. It is the company’s first for solar energy.

That deal last September was encouraging for utility-scale solar developers here given Luminant’s long association with coal, using it to generate most electricity. The company is also the state’s largest miner of lignite. Luminant contracted solar on economics and its ability compete in the ERCOT wholesale market, not to meet an internal sustainability goal or a government mandate.

Like Buckthorn, a SunEdison subsidiary that is not a debtor is building Castle Gap. A Luminant spokesman tellsRecharge that SunEdison continues to inform it that the project will be ready in time to meet the deadlines set out in the PPA.

“Commercial operation is expected in 2017,” he said. “We’re not going to lay out what the deadlines are because that is proprietary.”

The press release announcing the deal last September said Luminant will purchase the power “starting in late 2016.”

ERCOT data shows that SunEdison has an interconnection agreement to expand Castle Gap by 63MW.

SunEdison has more than $16bn in liabilities, according to Bloomberg.

LoneStar Rail is Dead - Almost!

The Capitol Area Metropolitan Planning Organization (CAMPO) voted last night to remove LoneStar Rail from its 25 year transportation plan which effectively kills the project.  The vote was 17 for and 1 against with 2 abstaining to remove the project from the plan.  A final vote is required by October 15, 2016.

In the meantime, a last ditch effort is to be mounted with Union Pacific to allow use of their rails.  This is not expected to be successful.

Georgetown has approximately $50K budgeted in FY17 to fund the environmental study that will be no longer needed.  Council should instruct the city staff to reduce the budget by that amount instead of spending it on other projects or services.

Let your council person know you support reducing the budget.

Proposed New City Hall Cost Estimates Double!

The cost estimate for renovation and re-purposing of existing city owned buildings that will move the City Hall and Municipal Court has more than doubled from $6.5M to $13.7M and no physical work has started.  City staff presented 4 options for reducing the cost down to $7.9M with drastic cuts that the City Council would not accept.  The staff wants the council to establish a new higher baseline cost, not currently defined, but, retains the basic design that has been presented.

The staff presentation with options can be viewed here: Downtown West

It seems that the council should send the staff back to the drawing board to come up with a new design and realistic plan that fits within the available budget of $6.5M which is the approximate amount expected from the sale of the existing city hall building.

Surely an advisory board of knowledgeable Georgetown citizens could be established that could vet any design that would meet the functional requirements of the city.  Such a board would concentrate on providing guidance to ensure the resulting design would meet commercial building standards without adding non-functional elements that invariably creep into public buildings.

Let your council person know that excessive spending on public buildings is not in the best interests of Georgetown's taxpayers.

More Public Pension Shenanigans Exposed

"America’s slow-motion public pension train-wreck (by some estimates, the shortfall currently exceeds $3 trillion) has been kept in motion for years by deeply dishonest accounting practices employed by state and local governments, which presume unrealistically that pension funds can consistently earn white-hot annual returns approaching eight percent. So it’s disappointing, but not particularly surprising, that the actuarial establishment moved to suppress a report pointing this out. Pensions and Investments reports:

The American Academy of Actuaries and the Society of Actuaries Monday abruptly disbanded its longtime joint Pension Finance Task Force, objecting to a task force paper challenging the standard actuarial practice of valuing public pension plan liabilities.

“This paper (is) being censored by the AAA” and SOA, said Edward Bartholomew, who was a member of the former task force, in an interview. “They didn’t want it to get out.”

Others who were members of the task force also said in interviews the two actuarial groups are trying to suppress publication of the paper.

There are powerful interests that don’t want public pensions to be governed by the same kinds of accounting principles used in the private sector because… well, because if they were, public pensions would go from seriously underfunded to catastrophically underfunded."

Additional information and analysis can be found at the following link. (The American Interest)

More On Solar and Wind Subsidies

The Texas Public Policy Foundation has an excellent review of a recent report (TPPF) on renewable energy by the International Energy Agency (IEA).

The IEA implicitly confirms that by removing government support, many renewable energy companies would collapse like a house of cards because they aren’t competitive without it. Further, the report concludes that without government subsidies for renewable companies, investors would not be comfortable investing private capital.

The review describes how the renewable energy industry has used financial engineering to finance the development of renewable energy plants.  When the financial house of cards collapses, Government steps in to rescue the financial institutions at the expense of the taxpayer. 

It’s time for Texas to take a closer look at the effect of increasing renewable generation and steer the competitive electricity market away from growing subsidies for unreliable energy sources.

Read the entire review at the TPPF website.

Pension Funds Continue to Mislead (Lie to) Their Beneficiaries

CALPERS, the largest public pension fund in the United States, servers as a proxy or leader of all public pension funds in the U.S. as far as policy and procedures are concerned.  They set the standard for all public pension funds.  Being the largest, they receive the most scrutiny.  It is seen that the Texas Municipal Retirement System generally follows the same path as CALPERS; the assumed high rate of investment return and diversification into high-risk asset classes for example.

Yves Smith at the nakedcapitalism blog chronicles the latest mischief.

CalPERS is also misleading beneficiaries and the public in communications that have much broader reach. In a Sacramento Bee op-ed, CalPERS board president Rob Feckner, in an op-ed that was almost certainly provided by CalPERS’ staff, tried to minimize CalPERS’ 0.6% return for fiscal year 2015-16 by contrasting it with the 18% return CalPERS achieved in fiscal year 2013-2014. Chief Operating Investment Officer made the same pitch in a short video on CalPERS’ website. But as the data cited by Varones showed, this result is not representative. If you look ever past measurement period that CalPERS has traditionally se, when the fundamentals were generally much more favorable than now, CalPERS hasn’t met its benchmarks. What basis does it possibly have for believing it will do better in the face of such big headwinds?

But instead of calling attention to the real problem, such as the destructive impact of central bank policies on savers of all sorts, as well as the damaging impact of bank-favoring post-crisis policies on growth, CalPERS is trying to snooker its beneficiaries on the fantasy that the old normal is coming back. 25 years of post-crisis malaise in Japan, near deflation in Europe, and nearly a decade-long weak recovery in the US, with no reason to expect better on any front, should disabuse them of that notion.

What CalPERS is so cavalierly tossing aside is its reputation for professionalism and accuracy. While its staff and board may reassure themselves that they are winning the image battle with their unsophisticated retirees, they are losing the war in the wider world, particularly with the media. . CalPERS needs to admit that it has serious fundamental problem with meeting its return targets. The longer it pretends otherwise, the greater the self-inflicted damage.

Kill LoneStar Rail!

ALL HANDS ON DECK!  Board to vote to KILL Lone Star Rail

Need folks to attend Monday to ensure they do!

Forbes magazine says Austin's Cap Metro light rail is the worst in the nation! Other light rail systems across Texas don't fare much better based on Forbes' analysis. It works out that every transit user gets a$9,000 per year subsidy! You could buy every transit rider their own vehicle for what it costs taxpayers to keep these rail boondoggles going! Let's not keep adding to the money pit by building Lone Star Rail, too! The Austin MPO, Capital Area MPO or CAMPO, meets Monday to vote to pull the plug on this boondoggle. Union Pacific pulled out of the deal saying it wasn't financially feasible, so it's past time elected officials put an end to the waste and pull the plug on any further 'study' of the matter. They've already spent $23 million 'studying' it. Bexar County Commissioner Kevin Wolff was arrested for DWI Sunday. For Bexar County residents, it's worth noting that Commissioner Kevin Wolff has pushed to keep wasting millions more to finish the 'study' of a project that's already been determined to not be feasible. Austin's MPO has said it won't put any more money into it and that San Antonio has to pony-up the bucks if the environmental study is to move forward. So that's Bexar County taxpayers paying for the boondoggle next! Wolff has an opponent in November and Wolff just got arrested for a DWI over the weekend. His judgment seems to be impaired on multiple fronts! So ALL HANDS ON DECK in Austin Monday night. If enough bodies show up to oppose Lone Star Rail, we might actually succeed in sparing taxpayers another money pit rail project! Vote to END Lone Star Rail CAMPO Meeting Monday, August 8 Joe C. Thompson Center, Room 3.102 University of Texas Campus Red River & Dean Keeton Streets Austin, Texas 6:00 PM AGENDA ITEM #8 - To remove Lone Star Rail from the transportation plan! Sign-up to speak for this agenda item and say 'No!' to keeping this project that is NOT financially feasible or workable in the plan. Courtesy of: Texans for Toll-free Highways, PO Box 29254, San Antonio, TX 78229-0254