Houston Resorts To Selling Off City Streets To Try And Close $100 Million Budget Shortfall

Tyler Durden's picture

With the US shale industry producing at near-record levels as oil prices languish around $50 a barrel, cities in oil-dependent states like Texas are resorting to increasingly creative means to compensate for the shortfall left by falling energy revenues, including selling off public assets, like Houston just did.

The city held what the Houston Chronicle described as “a yard sale of sorts” last week when the city council approved selling or swapping almost $2 million worth of city streets and utilities easements in a deal that will help close what’s expected to be a $100 million budget shortfall over the next five years.

Specifically, the council abandoned or sold several streets and easements on the east side of the city. The land is adjacent to an oil refinery owned by Valero Energy. The oil giant already owns the blocks immediately surrounding its facility, and the move will let the company assume the intersecting streets onto its land as part of a plan to build an office building, warehouse, security building and to add parking farther away from the central plant, the Chronicle reported.

The second example also comes from the east side, around Houston’s public Milby High School. The city agreed to abandon and sell parts of five streets and a sewer easement in and around the school campus for $431,000. But rather than pony up that cash, the school district is instead giving the city a 7.5-acre tract valued at $443,000 that used to be home to the now-defunct Clinton Park Elementary.

City officials have ramped up efforts to jettison useless easements and strips of city land in recent years amid repeated budget crunches. However, it’s somewhat less common for the dollar amounts to rise into the millions on the same meeting agenda. Councilman Robert Gallegos, whose district includes both sites, said he hopes the land swap can be beneficial for the neighborhood.

"Now that the city is taking over these 7.5 acres I hope this is a partnership that maybe the city and County Commissioner [Rodney] Ellis, we could work on hopefully making a community center," Gallegos said. "There's a desperate need for a community center in that community."

In another development that is draining the city’s tax base, Houston, one of the hardest hit markets from the collapse of oil prices, saw commercial vacancies rise to a 22-year high during the first quarter, according to a report by NAI Partners.

Unfortunately for Houston officials, there's little the city can do about the price of oil aside from praying that OPEC will come through with yet another production cut.

Comment viewing options

Select your preferred way to display the comments and click "Save settings" to activate your changes.
Mazzy's picture

How do people live in Houston with all it's heat and humidity?  Can you even take full breaths of air there?  How much water need one drink on an hourly basis? 

But this kind of corporate gifting goes on all the time.  Heck, my nearest metro area just gave Under Armor something equivalent to a district or a ward.

man from glad's picture

If it's this bad in Texas how bad is getting everywhere else?

booboo's picture

so bad I hear Texas Rangers have to drink water out of a muddy hoof print

luky luke's picture

But... but we're giving BILLION$ and BILLION$ every year to Apartheid Israel while America crumble$.

https://biblicisminstitute.wordpress.com/views-of-news/#armingapartheid

Cognitive Dissonance's picture

I've got a bridge to nowhere I'll sell you real cheap.

peopledontwanttruth's picture

Might be the safest place to be when this all heads further south.

MalteseFalcon's picture

Houston needs money?

How about this: "Houston brought to you by Valero", TX

Sponsorship of this kind could be worth millions.

Just imagine, the "Houston brought to you by Valero" Astros.

You're welcome.

Drimble Wedge's picture

How much water need one drink on an hourly basis?

 

You mean, like, from the toilet?

spdrdr's picture

Only if the toilet water has electrolytes...

Déjà view's picture

Won't convince Gov. Abbott...

Gov. Greg Abbott flew to Israel Saturday on a plane belonging to Sheldon Adelson, the billionaire casino owner and megadonor active in Republican national politics.

A spokesman for the governor confirmed that Abbott flew on Adelson’s 737 after Jewish Insider and The Dallas Morning News first reported it Monday.
Adelson is a top spender in Republican politics known for his fierce support of Israel and his friendship with Prime Minister Benjamin Netanyahu. Abbott met with Netanyahu in Jerusalem on Monday to discuss the Texas-Israeli relationship and reiterate Abbott’s opposition to Iran — a nation whose relationship with Israel has long been tense.
http://www.star-telegram.com/news/state/texas/article55442970.html

It was discussed with the prime minister, as well as other leaders in Israel,” Abbott said. “… I made very clear to the prime minister that he has no greater ally on the globe than Texas.”
http://tjpnews.com/texas-gov-abbott-talks-business-alliance-with-israel-.

Troll Magnet's picture

Oh shit. They already chose our future president? I thought they picked our future CEO's in early December, right after Thanksgiving and right before Hanukah?

hardmedicine's picture

Texas needs to secede!!!  President Abbott

peopledontwanttruth's picture

Good reference to Glenn Campbell in True Grit

Déjà view's picture

Barrio area...packs of wild dogs...illegal dumping...nobuenos aires/agua...
Any worse in China?

Si Señor!

helloimjohnnycat's picture

Sing it :

With these cupped hands around my piss can I can take a leak when Brays Bayou overflows

and runs a river thru the backyard I remember was in my old hood.

 

Déjà view's picture

Would help if these were removed...

What lies beneath: 127 cars in the bayous
Dispatches from Harris County

http://www.houstonchronicle.com/local/gray-matters/article/127-cars-in-t...

divingengineer's picture

If I ever meet one o' you texas boys that ain't drunk water out of a hoof print, I'll shake his hand or buy him a Daniel Webster cigar!

totenkopf88's picture

I know ZH likes to hammer IL but everybody else is in the same boat- you can't give yearly 3% Cost of Living increases to every public employee retiree, $125K salaries to cops, and have bloated school administrations and expect states to stay solvent 

peopledontwanttruth's picture

Bingo. The whole country is going to default again but it will be worse than 1933.

man from glad's picture

Only after everyone is "bailed in" which is coming in short order.

peopledontwanttruth's picture

When every last penny has been taken then it's game on.

uhland62's picture

Signal for the rest of the world to avoid using the financial industry/Wall Street?

Speeds it up. Better an end with shock then shocking times without end. People wanted boom/bust or they would have done something about it. The corporations who make money on the arms race are still going strrong. 

peopledontwanttruth's picture

I think it's at that point that WWIII is on, when the world turns it's back on the dollar and the Gig is up. At which point is like stealing their bank account aka printer

Déjà view's picture

Tejas is different from MexiCali...CALPERS only had a 7.5% return...reduced to 7%.

The plan further reduces the pension funds' assumed rates of return to 7% from the current rates — which ranged between 8% and 8.5%.

The firefighters' lawsuit, filed in Harris County District Court against the city of Houston on Tuesday, argues that the pension fund has “sole constitutional discretion” over determining the fund's actuarial assumptions, including its assumed rate or return, according to a news release from the pension fund Wednesday. On Tuesday, the pension fund board lowered its assumed rate of return to 7.25% from 8.5%.

http://www.pionline.com/article/20170531/ONLINE/170539972/texas-governor...

TEJAS IS ALSO RUN BY SPENDTHRIFTS!

Si Señor!

AND...

Debt is also growing rapidly among the state’s 81 retirement systems for local-government workers. Not only are these systems poorly funded; it isn’t even clear how much some owe, since they haven’t disclosed the financial information necessary to verify their financial position, even to state oversight officials. After an extensive survey of municipal pension systems, Combs determined that none of the local plans was fully funded and that only 19 percent had 80 percent of the funds on hand to meet future obligations. 
http://www.city-journal.org/html/deep-debt-texas-13556.html

One does NOT want to hang around when these Debts Of Massive Destruction hit...

CABs generally offer longer terms than conventional bonds, allowing investors to reap a greater amount of compounded interest over time — and allowing borrowers to defer debt service payments for decades. CABs allow school districts to "build now, pay later" — "later" being many years down the road, when the tax base may have grown enough to make repayment less of a burden. Some districts may set aside money along the way to ease the burden when their CABs reach maturity.

Overreliance on CABs, however, can be costly for school districts when the eventual lump-sum payments become due. According to Texas Bond Review Board (BRB) data, as of the end of fiscal 2014 Forney ISD had issued four of the 20 most expensive CABs outstanding for Texas school districts. For just under $30 million in immediate funding, the district will have to repay more than $208 million when the bonds reach maturity in 30 to 40 years.
https://comptroller.texas.gov/economy/fiscal-notes/2016/march/cab.php

'Loan' Star state backs most local debt...nationally second highest after N.Y.
CAN RUN BUT NOT HIDE-ANYWHERE IN TEJAS...

peopledontwanttruth's picture

Click on your state. It's bad everywhere Speeding up

http://www.usdebtclock.org/

peopledontwanttruth's picture

It's amazing just how far this country once the greatest on the earth has sunk.

All these politicians should be jailed for running everyone everywhere into the ground

BarkingCat's picture

Don't cry for me Argentina.

Yes, Argentina was on equal footing with the US at the beginning of the 20th century.

Looks like the took the shortcut to where the US is going.

peopledontwanttruth's picture

Thanks didn't realize that.

But that's the difference of being the reserve currency. The USA will get there but had a better magician then Argentina

chosen's picture

The business of America is business. And don't forget it.

helloimjohnnycat's picture

Easy :  I'm not a fat fuck !

Lean & Mean

ONLY the Strong Survive.

BarkingCat's picture

You better have brains too.

Stong and dumb will be just as dead as someone who's fat.

 

SubjectivObject's picture

3H; Houston Heat Humidity

you get used to it; dress light; no need for a separate sauna in the house

about one pint every 2 hours when working out in it, messikins got justification to snear at the paying caucs

would be tolerable but for the mosquitos; 

the jurisdictional bug spray operation has killed off the bigger slow ones that you can hit and filtered to the tiny frenetic one that are near imposible to see and hit; those transient muscle/body ache&pain cycles one gets ...?  ... bug bites.

booboo's picture

I will take Yellowstone for 5 bucks an acre

in other news lots of grandma's lived on those streets so yea, the state will sell your own grandma

helloimjohnnycat's picture

Yellowstone in HOUSTON ! ??

Aw man, get real.  Not a penny over a buck thutty.

 

SubjectivObject's picture

yellow stone in houston:  sulphur

Pairadimes's picture

Democrats have run this city for too long. 

booboo's picture

take it to the next logical step. Why do cities need to be "run" when the private sector eventually has to do all the work anyways?

totenkopf88's picture

D or R- this is across-the-board fuckery of the taxpayer 

peopledontwanttruth's picture

Same team, one runs the offense the other the defense

Common_Law's picture

Then one scores and they switch, right? Or is that some other American religion?

peopledontwanttruth's picture

You can be sure it's all in the playbook

helloimjohnnycat's picture

Yep, and we all know what religious group posing as a nationality has been robbin' da' hen house.

The tribe has got Jewston by its Buffalo Bayou bailed-out balls.

I hope the next flood drowns the ratz.  lol !  glub, glub

SubjectivObject's picture

significant area of River Oaks was [deep] under water from Alison.

but (((they)))'re still there.

good luck with that hope

MadHatt's picture

"7.5-acre tract valued at $443,000 that used to be home to the now-defunct Clinton Park Elementary"

 

Something with a Clinton name on it is defunct?

No. Way. /s

Seasmoke's picture

I will offer $100 for the Astrodome. Take it or leave it. 

peopledontwanttruth's picture

Worse thing about this deficit is it's less than the average city/owner pays its sports stars on any given team in salaries.

That's how screwed up this country is.

BiteMeBO's picture

Chapter Seven Street

VWAndy's picture

  How much to ship it someplace nice?