Memorial Park was a gift from the Hogg Family to the City of Houston. In 1924 Mike and Will Hogg, the sons of former Governor of Texas James Hogg (1891-1895), deeded 1,503 acres to the City of Houston. Under the transfer agreement, the land must be used for park purposes or be subject to reversion to the Daughters of the Republic of Texas. Ima Hogg, sister of the two donors, charged several people with the task of protecting the park: Sadie Gwin Blackburn, Terry Hershey, Frank C. Smith Jr., Dr. John D. Staub. This group later became known as the Memorial Park Advisory Committee. To give you an idea of the value of this gift, a square foot value of $100 multiplied by the park acreage equates to 6.5 billion dollars. Currently, land in the Memorial Park area has sold for $300 per square foot; so, you do the math. There is no question that we are talking about a lot of money.
Approximately one month ago, rumors began flying around town that Mayor Annise Parker was planning to allow TIRZ 16 to expand into Memorial Park. Mayor Annise Parker indeed placed a proposal on the May 15 City Council agenda to have TIRZ 16 expand its borders to include Memorial Park. Please note I used the word expand and not annex.
First, you should know TIRZ 16 is a Tax Increment Reinvestment Zone established in 1999. This sends the incremental value of City of Houston property tax from 1999 to the TIRZ – this is big money, hundreds of millions of dollars. TIRZ 16 covers the Galleria area and their leadership wants to build a Bus Rapid Transit System down Post Oak. I disagree with his scheme for a number of reasons; but, I have remained silent because the TIRZ 16 board includes some of the property owners within the TIRZ. If they want to ruin their property value, far be it for me to tell them they cannot do so. Let me explain how this impacts Memorial Park.
All TIRZ are a political subdivision of the State of Texas and and have a specific purpose and duration. As you can imagine, the City of Houston would love to have their hands on this revenue stream. TIRZ 16 has spent most of their future revenues on other projects through the life of the TIRZ, which is set to expire in 2029.
Think of the value of the Galleria and Uptown areas. The area has more than doubled in value since 1999, we are talking hundreds of millions of dollars in property taxes. TIRZ 16 is looking for an extension; so, this is not a good time to go hat in hand and ask Mayor Parker “mommy may I” when there is an election around the corner. TIRZ 16 desperately wants to be extended through 2040, which would allow them to to finance construction of the Bus Rapid Transit System.
This spring, I spoke twice against expanding the TIRZ to include Memorial Park: once at council and then at a public hearing held by Stephen Costello. Yes, another controversy involving Costello. By now, alarm bells should be going off in your head.
Two years ago, Stephen Costello, leader of Costello, Inc., a civil engineering and surveying firm, used the Renew Houston (Prop 1) ballot measure to bolster his own pocketbook. The last time I looked, Mr. Costello had over 40 million dollars in contracts with the City of Houston and he refuses to recuse himself from voting on contracts involving his firm. More importantly, there was a contract that he and the city of Houston refused to disclose, even after I made repeated trips to City Council. We still do not have that contract, even though he reports the contract on a disclosure form.
Now that we have established that a conflicted councilman does not mind the appearance of impropriety, you should be prepared for the next bit of information. Mr. Costello is a past president and current advisory board of the Memorial Park Conservancy. The new chairman of the Memorial Park Conservancy is Bryan Jordan. Mr. Jordan is President and CEO of Jones & Carter, Inc. This is the engineering firm owned by Bob Jones – the man who said, “We do not have any leadership from our African American council members.”
When I spoke at City Council on the Memorial Park issue, I expressed concern that TIRZ 16 would include the park in their borrowing schemes. Council Members Oliver Pennington and Mike Laster were quick to say that could not happen. This was disconcerting to me because Mr. Laster was previously sued for his conduct involving a management district. The City Attorney responded that he would offer an opinion on potential borrowing issues involving Memorial Park. Unfortunately, that opinion never came and this issue went unaddressed.
Memorial Park was a gift to the City of Houston, a gift of incredible magnitude that no one could ever afford to replicate. Mayor Parker has balanced the City of Houston budget by selling off assets over the last several years. Mayor Parker and Bill White have established a precedent by spending far more money than the City brings in and selling assets to produce a balanced budget. This brings grave concern to anyone who cares about Memorial Park.
Allowing Memorial Park to be annexed into a political subdivision of Texas also creates risk. The city has now created an opportunity for the Legislature to interfere with the park. This, of course, would never be an issue if Mayor Parker had cared enough to take care of this jewel of Houston.
Now, we get to the root of the matter – Mayor Parker has bankrupted the City. For years, as Controller and Mayor, Annise Parker has spent far more money than the City’s revenue. She is using the drought as a reason for this necessity; but, I say “hog wash”. There will always be natural disasters that will always threaten the park. It is an asset of the City and should be maintained as such. The Mayor’s liberal spending policies have now made it so the City cannot even take care of this great asset.
This set of circumstances should just go to underscore that TIRZ's and management districts are 'bleeding the city dry' of desperately needed funds by stealing future, appreciating cash flows and committing them to what selected property owners desire, and not to the needs of the city as a whole. It is not a coincidence that our city finances are in a 'death spiral' as the expansion of TIRZ's and management districts continue.
My respect for Don Hooper grows daily, especially after reading this.
Robert and Stan, thank you!
Don,
Great article! Now is the time to take a stand and act on these issues regarding spending and also address the “masking” of the City’s so called “balanced” budget. I believe Houston needs to be educated in an innovative and “eye opening” way. We can talk about this all day until we are blue in our faces and still not get the message out properly or effectively. This has been proven by Bond after Bond being presented to the people of Houston and these Bonds continue to pass. No longer can we sit idly by and allow our city to be so irresponsibly driven into the ground. Many of the people of Houston are completely unaware of the ground crumbling beneath their feet. Let us not forget just after the announcement of the last $410 million package. Ronald Green gave a “stout” warning on the proposal after being denied any of its details. I was ok with his statements until he said, “The city should take advantage of low interest rates and ask for $600 million to $800 million, even if that requires a tax increase”. We can not continue to spend in this seemingly euphoric manner that does nothing to help the immediate needs in our infrastructure throughout the city.
I continue to notice how many are enamored by those who are feeding spoons full of promises that result in more and more debt. This can not continue much longer without Houston experiencing the same fate as Detroit
An admirable piece of research and an excellent presentation.
We need a lawyer to craft a charter amendment that would put a halt to this sort of misbehavior.
Once that is ready we can look for funders to get it on the ballot. Alternately, we can ask local groups to endorse it and to screen candidates for office based on their willingness to have council vote to put it on the ballot.
Great article. There is a lot of inside baseball going on in city finances and we are lucky to have Don monitoring the issue.