BG Reads | News You Need to Know (April 28, 2021)
[BINGHAM GROUP]
BG Podcast EP. 139: Q1 20201 Review: COVID-19's Impact on the Built Environment with Michael Hsu
On today’s episode we speak with return guest, Austin-based Michael Hsu, Principal and Founder of Michael Hsu Office of Architecture.
He and Bingham Group CEO A.J. catch up from their June 2020 show, updating on impacts to the design/built environment sector through Q1 2021.
You can listen to all episodes on Spotify, Apple Podcasts, and SoundCloud. New content every Wednesday. Please like, link, comment and subscribe!
[MEETING/HEARINGS]
[THE 87TH TEXAS LEGISLATURE]
LINK TO FILED HOUSE BILLS (5,809)
LINK TO FILED SENATE BILLS (2,655)
[AUSTIN METRO NEWS]
Joint council mulls ‘once in a generation’ ARPA funding for region (Austin Monitor)
The Commissioners Court joined City Council Tuesday to discuss the allocation of federal funding granted by the 2021 American Rescue Plan Act. Ralph Garboushian, a career municipal consultant, described the level of local funding from ARPA as “once in a generation.”
While $424 billion of the $1.9 trillion total was directly distributed to individuals in the form of $1,400 checks, the next largest chunk of ARPA funding, $360 billion, will be devoted to state and local fiscal assistance programs. Additional money from ARPA is also expected to reach local and state governments in the form of rental assistance and homelessness prevention assistance.
“I’ve worked in local governments for just over 25 years, and this is once-in-a-generation kind of money coming down to local governments,” Garboushian said.
The city of Austin is slated to receive $195.8 million in local fiscal assistance, $22 million in rental assistance and $11 million in homelessness prevention assistance. The county, meanwhile, gets $247 million in fiscal assistance and $10.6 million in rental assistance, according to the same estimates.
“These are just estimates, based on an Excel chart the House government Reform and Oversight Committee put out back when the bill was moving,” Garboushian said of the allocation numbers. While the Treasury Department hasn’t yet announced official allocations, he said these numbers are “pretty accurate.”
One potential roadblock in communities receiving their funding has to do with the minutiae of the rules surrounding allocation.
Counties and certain cities like Austin, Round Rock and Pflugerville – which are presently classified as Community Development Block Grant entitlement cities – will receive money directly from the federal government, with no middleman. However, smaller communities and “non-entitlement” local governments will have to receive their money sub-allocated from the state.
ARPA also extends the child tax credit and the earned income tax credit to last an additional year, in addition to assisting airports and local transit. Capital Metropolitan Transportation Authority is slated to receive about $130 million.
“I don’t think we can cover everything in this bill in a single presentation,” Garboushian said.
Rosie Truelove, director of the city’s Housing and Planning Department, addressed the $22 million in emergency rental assistance, saying, “This is going to be deployed in phases and can be used for eligible things such as rent, rental arrears, utilities and home energy costs, and other expenses related to housing as defined by the U.S. Treasury.”
The emergency rental assistance component of ARPA is just one aspect of housing-related funding that the city will receive. ARPA also designates money for homelessness and home allocation from Housing and Urban Development in the amount of $11 million.
“We do not have any guidance on this yet for when we’ll be able to apply for or plan out these dollars,” Truelove said. “We do anticipate getting that in the next couple of months but we are excited about the opportunity for $11 million to be spent directly on homelessness.” Specifically, she mentioned the prospects of using the money toward programs such as transitional housing, tenant-based rental assistance and homelessness prevention services… (LINK TO STORY)
Austin health officials weigh new CDC mask guidance, moving community to safer Stage 2 (Austin American-Statesman)
Austin Public Health officials on Tuesday said they are trying to figure out how to apply the national Centers for Disease Control and Prevention's new mask guidelines, just as they are preparing to loosen coronavirus pandemic restrictions.
The CDC's updated guidelines include new rules that say Americans who are fully vaccinated can unmask while walking, running, hiking or biking outdoors alone or with members of their household.
Fully vaccinated people also don’t need to wear a mask during small outdoor gatherings with fully vaccinated family and friends, or at gatherings with a mixture of vaccinated and unvaccinated people, the CDC said.
In addition, fully vaccinated individuals don’t need to wear a mask at outdoor restaurants with friends from multiple households, according to the new guidance.
Throughout the pandemic, Austin and Travis County's mask guidelines have consistently allowed exemptions from wearing masks for those who were performing physical activity outside.
Dr. Mark Escott, interim Austin-Travis County health authority, told members of Austin's City Council and Travis County's Commissioners Court that he planned to work with the elected leaders to incorporate the CDC's new guidelines locally as quickly as possible.
Austin Public Health officials said any changes to mask requirements locally would likely be announced at the same time the area moves to Stage 2 of risk-based guidelines, which likely will happen later this week or early next week.
"We do know that outdoor transmission is rare and it's likely we will further relax those requirements for masking and or distancing outdoors," Escott said, adding that he would also be releasing guidance on summer camps and graduations this week, too.
Mask rules for outdoor gatherings have special importance in Austin, where crowds routinely gather downtown to watch bats fly from roosts under the Ann W. Richards Congress Avenue bridge, pass each other on narrow hike-and-bike trails along Lady Bird Lake, and traditionally assembled in city parks for popular outdoor festivals.
Austin and Travis County's mask mandate faced a legal challenge from Texas Attorney General Ken Paxton earlier this year. Paxton argued that Gov. Greg Abbott's orders stating that masks were no longer necessary superseded any local mandates. State District Judge Lora Livingston ruled in favor of Austin and Travis County and the local mask mandate remained… (LINK TO STORY)
Developers bullish on Austin office market despite vacancies, negative absorption, JLL says (Austin Business Journal)
Cautious optimism has been the prevailing sentiment during the first few few of months of 2021 — vaccinations began rolling out and companies with work-from-home mandates started looking at the summer as the time people might physically return to the office.
A first-quarter office report published by Jones Lang LaSalle Inc. (NYSE: JLL) didn't paint an optimistic or rosy picture, however. On the one hand, developers are bullish about the future. But on the other, Austin’s office market had a net occupancy loss for the first three months of the year despite being on a roll for corporate expansions and relocations.
Developers are primarily bullish on East and Southeast Austin, where several office projects have either come online, are in the works or have been proposed.
JLL noted developers are bullish on tenant demand due to several speculative projects breaking ground in Q2 2021, such as 1515 Cesar Chavez Ave. and two creative buildings at Met Center.
The three-story 1515 Cesar Chavez Ave. project, for example, would bring 71,632 square feet of class A office space to in East Austin. It is the latest project in a transforming section of East Austin. Conde Nast, DPR, Google, Livestrong Foundation, Lake Flato Architects, SAS and Sysco are among the corporate offices within walking distance of 1515 Cesar Chavez Avenue.
JLL, which is handling the leasing for 1515 Cesar Chavez Ave., reports tenants would be able to move in by August 2022.
Other projects in the pipeline or already online east and southeast of Austin’s Central Business District are Tesla’s gigafactory, Velocity, Capsum and River Park, to name but a few.
The future might look bright but there are reasons to pause in the present, when it comes to office vacancy and net absorption.
Total office vacancy was at 14.6%, with the year-to-date net absorption at negative 746,088 square feet. The direct asking rent was $49.45 per square foot, while the sublease asking rent was $48.84 per square foot — both trending downward. Tenant concessions are rising.
Leasing activity has been below 2019 levels. There are signs of life and post-pandemic recovery, however, as JLL found leasing activity for Q1 2021 is more than double Q2 2020, when the pandemic started.
“Austin’s office environment experienced 1.3% net occupancy loss in Q1 2021, after a few large tenants in the Northwest and Southwest submarkets vacated space, including an additional ~49,000 square feet from Spiceworks,” the JLL report stated. “Further adding to the vacancy, an additional 207,857 square feet delivered this quarter, of which only 19% was pre-leased.”
At least 5.7 million square feet of office inventory was underway in Austin, according to JLL — adding to Austin’s 58 million square feet of inventory. About 30% of that 5.7 million square feet was pre-leased.
Corporate relocations and expansions to East and Southeast Austin, such as Tesla, Amazon and others, have fueled optimism for tenant demand in suburban submarkets, according to JLL… (LINK TO STORY)
UT's Moody Center will be 'a world-class venue built for music,' its developers say (Austin American-Statesman)
When plans for a new arena to replace the 44-year-old Erwin Center coalesced a couple of years ago, much of the focus was on the University of Texas men’s and women’s basketball teams getting a new home court. But the new Moody Center also is aiming to become one of the nation’s premier concert venues.
About a year from now, if all goes according to plan, the $338 million Moody Center will begin presenting shows by some of the biggest names in popular music. Already announced is Canadian superstar the Weeknd, who played the halftime show at this year’s Super Bowl. Many more shows are in the works — possibly at a pace of 150 a year, up from Erwin's average of about 50, according to three of the key players involved in building and booking the arena.
Major entertainment industry figures Irving Azoff and Tim Leiweke created Oak View Group in 2016 to develop new arenas in several large markets. They joined Austinite Charles Attal of major concert promotion company C3 Presents — whose parent company, Live Nation, is part of the Moody Center development team — for an exclusive interview with the American-Statesman.
Leiweke said that part of the reason for the conversation was to call attention to the new arena’s ambitions for music as well as sports. “We've been late talking about it,” he said, “because right now, everyone thinks we’re building a basketball arena.”
In reality, Azoff said, the Moody Center “is going to be a world-class venue that was built for music. I don't mean to say that University of Texas basketball isn't going to be really important, but this is going to be one of the top 10 concert venues in the country.”
The Erwin Center has been Austin’s largest music facility since it opened in 1977. The Moody Center will hold about 15,000 for concerts, similar to the Erwin Center’s size in its most frequently used south-stage setup. Though capacity won’t change much, the Moody’s builders promise a significant upgrade in sound quality and overall concert experience…(LINK TO STORY)
[TEXAS NEWS]
Is Texas Legislature poised to make necessary changes to prevent power crises? Some experts say no. (Austin American-Statesman)
When deadly winter storms ravaged the state in February and power outages plunged more than 4 million people into cold and darkness, Gov. Greg Abbott had already set his priorities for the Legislature and the 140-day legislative session was a month old. Lawmakers were tackling issues related to the coronavirus pandemic, navigating a budget shortfall and pursuing conservative priorities such as expanding abortion restrictions, limiting transgender athletes and eliminating gun permits. But after the lights came back on, legislators had a new mission: Make drastic changes to the state’s power supply system and electric grid to prevent crises, while also avoiding the mistakes of legislatures past, which failed to take meaningful action after similar winter weather and blackouts.
Lawmakers made quick work of the energy crisis, holding hearings and passing bills meant to address the outages within six weeks of the storms. The legislation mandates some level of equipment weatherization and improves coordination between state agencies during emergencies. Energy experts, however, say that the proposals don't go far enough and that if lawmakers don’t start planning for the long term with climate change in mind, they could be setting the state up for crises. “They take some halfway steps to getting the power and gas regulators talking to each other and working together, but they do nowhere near enough to address the systemic vulnerabilities that the storm exposed,” said Daniel Cohan, an associate professor in the department of civil and environmental engineering at Rice University. “Unfortunately, even if these bills are enacted, they’re not going to be enough to prevent the breakdown of the gas supply system that we saw in the last storm.”… (LINK TO STORY)
Dallas’ broken building-permit process is robbing our tax base of millions in needed funds (Dallas Morning News Op-Ed)
Construction permits are the essential fuel for a city’s growth and tax base, so you’d think every local government would get this basic service right. But not Dallas — where the application process has gone from dreadfully frustrating to flat-out broken. The failure couldn’t come at a worse time: The region is booming, people are moving here in droves and businesses are looking for where in North Texas they can get deals done most efficiently. But in Dallas, even simple permits — both for commercial and residential projects — require months for approval. Entire plans might be thrown out over a nitpicky detail. Department staffers too often don’t answer their phones; when they do, they don’t seem overly concerned about solving the problem at hand.
“It’s an equal opportunity problem — pain and agony for big developers and small — that is impacting the economic health of our city,” Linda McMahon, president of The Real Estate Council, said after she shared a dozen examples. I’ve heard exactly the same from Dallas developers who won’t talk on the record because they fear what they describe as the swift and fierce vengeance of the permitting office bureaucrats. This catch-22 gives City Hall — particularly its Department of Sustainable Development and Construction — an out it doesn’t deserve. The mind-boggling delays cause businesses initially keen on a Dallas address to give up and go to the suburbs. They leave developers vowing never to take another chance on our city. Why should you care? The festering dysfunction robs our tax base of much-needed dollars to fund basic services like police and potholes. There’s also the double-whammy loss of new single-family homes and jobs, both in the construction projects themselves and the employment opportunities the built-out development would bring… (LINK TO STORY)
Gov. Greg Abbott says he’ll sign bill allowing permitless carrying of handguns, believes Senate is “making progress” (Texas Tribune)
Gov. Greg Abbott said Tuesday he would sign legislation allowing Texans to carry handguns in public without a license, breaking his silence on a proposal that has been building unprecedented momentum in the Texas Legislature.
"I support it, and I believe it should reach my desk, and we should have 'constitutional carry' in Texas," Abbott told North Texas radio host Rick Roberts.
As recently as a week ago, Abbott had declined to say whether he supported such a proposal, which the House passed earlier this month. Lt. Gov. Dan Patrick has said the Senate does not have the votes for the legislation, but he is trying to find a way to move it through the process.
Last week, Patrick created a new committee with a majority of permitless carry supporters. The House legislation, House Bill 1927, was then referred to the panel, and HB 1927 is set for a hearing Thursday.
Abbott said he has talked to "several senators" on the new Senate Special Committee on Constitutional Issues.
"I believe it is making progress," Abbott said. "Once the Senate passes it out, the House and Senate will convene and work out any differences and get it to my desk, and I'll be signing it."
Abbott's support continues to demonstrate how far the push for "constitutional carry" has come in recent weeks. It has stalled earlier in the legislative process during previous sessions, and last session, then-House Speaker Dennis Bonnen, R-Angleton, declared it "dead" after a gun rights activist showed up at his Lake Jackson home to advocate for the proposal… (LINK TO STORY)
Harris County Sheriff Ed Gonzalez, a vocal critic of Trump's immigration policies, tapped by Biden to lead ICE (Texas Tribune)
President Joe Biden announced Tuesday that he will nominate Harris County Sheriff Ed Gonzalez, a vocal skeptic of cooperating with federal immigration authorities in certain circumstances, to serve as director of U.S. Immigration and Customs Enforcement.
As head of ICE, Gonzalez would help oversee one of the most contentious parts of Biden's agenda: enforcing U.S. immigration law. Biden has promised to unwind much of predecessor Donald Trump's hardline border policies.
Gonzalez is a former Houston police officer who served on the City Council before first getting elected sheriff in 2016. He won a second four-year term in 2020. During his first term, he was a vocal critic of Trump's approach to immigration… (LINK TO STORY)
[NATIONAL NEWS]
Here's what's in Biden's $1.8T American Families Plan (The Hill)
President Biden on Wednesday will outline the American Families Plan, an ambitious package that would call for $1 trillion in new spending and $800 billion in new tax cuts and aim to significantly expand access to preschool and community college, as well as child care and health care benefits.
Biden will detail the proposal during a speech before a joint session of Congress in which he is expected to lay out his agenda for the coming months. The centerpiece of the speech will be the families plan, which is being rolled out less than a month after Biden unveiled a $2.3 trillion infrastructure proposal.
The American Families Plan calls for a $200 billion program offering universal pre-kindergarten for all three- and four-year-olds; $109 billion for tuition-free community college for any American who wants it; $85 billion to increase Pell Grants to benefit low-income and minority students; and over $4 billion in funding for larger scholarships, certification and support programs for teachers.
The plan would build upon provisions of the American Rescue Plan by extending the Affordable Care Act premiums tax credits indefinitely and make the earned income tax credit expansion for childless workers permanent. It would permanently make the child tax credit fully available to the lowest-income families, while extending other aspects of the expansion of the credit, such as the increase in the credit amount, through 2025.
The proposal also calls for the creation of a national paid family and medical leave program. The $225 billion investment would provide workers up to $4,000 a month if they require leave to care for a new child, a seriously ill loved one, deal with an illness or another serious reason.
Other measures Biden will call on Congress to pass include a $45 billion investment in meal programs for children and low-income families; unemployment insurance reform; $225 billion for investments in childcare that would include a $15 minimum wage for early childhood staff and expanded child care center accessibility.
Officials said the plan would be paid for through tax reforms targeted at wealthy Americans, such as an increased capital gains tax rate, a higher top income tax rate, and increased IRS auditing enforcement on high-income individuals and businesses.
“We view the American Families Plan as a core element of President Biden’s strategy to build back better and generate a strong and inclusive economy for the future,” a senior administration official said… (LINK TO STORY)
Carville: “Wokeness is a problem and we all know it” (VOX)
I called James Carville hoping to get his thoughts on President Joe Biden’s first 100 days in office. He obliged — then, one question in, brushed aside the exercise to talk instead about why the Democrats might be poised to squander their political advantage against a damaged GOP. His failure to cooperate may have been for the best since the first 100 days ritual can sometimes lead to dull, dutiful analysis. What Carville offered up instead was a blunt critique of his own party even after a successful 2020 election cycle — a sequel of sorts to his fulminations during last year’s Democratic primaries. The longtime Democratic strategist is mostly pleased with Biden, but it’s where much of the party seems to be going that has him worried. “Wokeness is a problem,” he told me, “and we all know it.” According to Carville, Democrats are in power for now, but they also only narrowly defeated Donald Trump, “a world-historical buffoon,” and they lost congressional seats and failed to pick up state legislatures. The reason is simple: They’ve got a “messaging problem.”
Sean Illing: "What do you make of Biden’s first 100 days?"
James Carville: "Honestly, if we’re just talking about Biden, it’s very difficult to find something to complain about. And to me his biggest attribute is that he’s not into 'faculty lounge' politics."
Sean Illing: "'Faculty lounge' politics?"
James Carville: "You ever get the sense that people in faculty lounges in fancy colleges use a different language than ordinary people? They come up with a word like “Latinx” that no one else uses. Or they use a phrase like “communities of color.” I don’t know anyone who speaks like that. I don’t know anyone who lives in a “community of color.” I know lots of white and Black and brown people and they all live in ... neighborhoods. There’s nothing inherently wrong with these phrases. But this is not how people talk. This is not how voters talk. And doing it anyway is a signal that you’re talking one language and the people you want to vote for you are speaking another language. This stuff is harmless in one sense, but in another sense it’s not."… (LINK TO STORY)
McCarthy and Cheney worlds apart after Florida retreat (Politico)
House Minority Leader Kevin McCarthy spent three days urging his Republicans to stay united if they want to take back the majority. But his own relationship with one of his top deputies is breaking apart over former President Donald Trump. At a retreat meant to craft a cohesive message, McCarthy (R-Calif.) and GOP Conference Chair Liz Cheney (R-Wyo.) illustrated the exact rift the party has fought to avoid. While the former president wasn’t even invited to the House GOP’s annual policy retreat here in the Sunshine State, his presence has loomed large over the gathering. McCarthy, when asked whether it’s difficult to have harmony in his ranks when Cheney has been so vocal with her viewpoints on Trump, offered up some thinly veiled criticism. “There’s a responsibility, if you’re gonna be in leadership, leaders eat last,” McCarthy told POLITICO in a wide-ranging interview on Monday. “And when leaders try to go out, and not work as one team, it creates difficulties.”
The California Republican also said he’s privately approached Cheney about toning down some of her remarks. When asked whether Cheney has heeded the advice, McCarthy responded: “You be the judge.” And at a Tuesday press conference, McCarthy — who has urged Republicans not to attack each other — took another public whack at Cheney. Asked if she was still a good fit for his leadership team, McCarthy first said it’s a question for the House GOP conference. His members voted less than three months ago to keep Cheney in her leadership spot, at McCarthy’s own urging. Then when pressed for his personal opinion on the matter, McCarthy told a room full of reporters that "if you're sitting here at a retreat that's focused on policy, focused on the future of making America next-century, and you're talking about something else, you're not being productive." Cheney has addressed policy during her time in the Sunshine State but not shied away from questions about Trump. She told the New York Post on Monday that she believes support for Trump-backed challenges to the certification of the 2020 election should be disqualifying for any 2024 Republican presidential nominee… (LINK TO STORY)