As the City of Houston begins drainage projects in Forest Cove to re-establish roadside ditches, many Kingwood residents are wondering why it has taken so long to begin these and other projects, particularly since Hurricane Harvey. After all, the city has collected millions of dollars in dedicated drainage fees over the last few years.
Houstonians across the city are wondering the same thing. Many neighborhoods have seen little visible progress in drainage improvements, either before or after Hurricane Harvey. City records show many drainage projects with a funded status, but for a large number of those projects, construction hasn’t even started. Other multi-million-dollar drainage projects already in progress have been delayed for significant periods of time, sometimes one or more years. Why?
– Residents wonder where the money is? –
Answering that question requires a look back to 2010, when voters approved Proposition 1 to add a small fee to Houston water bills to help pay for drainage infrastructure projects. The program was approved in 2010 and fully funded in 2012 under Mayor Bill White, and continued under mayors Annise Parker and Sylvester Turner. The effort is better known as Rebuild Houston, the city initiative “to improve the quality of life and mobility for residents of the city by rebuilding our drainage and street infrastructure.” Each household is charged a small fee ($0.032 cents per square foot of a homeowner’s property for curb drainage, $0.026 for open gutter drainage). For a 1,500 square-foot house, the fee amounts to about $50 per year, but when one considers that every household in Houston is taxed, these fees add up to millions of dollars. Other funds also feed Rebuild Houston, including city grants, developer impact fees, and a portion of the city property tax.
How has the city performed over the last near decade since the fee was enacted?
The city gives itself more than a passing grade on drainage efforts. They report that since the start of the program, ReBuild Houston has improved over 900 miles of drainage across the city, including both repair and reconstruction.
However, the city has spent less, not more, on street drainage and other projects. City records show that less than half of the $781 million collected to date has actually been used toward drainage projects and street improvements.
The program was designed as a "pay-as-you-go" approach, so projects do not start until there is enough money for them. But shouldn’t there be enough money for them, given that nearly $800 million has been collected since 2010?
Well, no. Turner explained that one of the provisions in the Rebuild Houston effort was to first pay down city debt, so that has superseded the city’s ability to make more progress on drainage projects.
Turner has been assuring Houstonians at town hall meetings, saying, “We just have to finish paying down the debt and then you'll see those numbers substantially increase.” Turner said the city has already paid down $1.1 billion in debt, but the city controller’s (Chris Brown’s) office says the number is much lower – about $625 million: “The controller's office cannot attest to the claim that Rebuild has paid down $1 billion of city debt. The city has paid down $622,962,600 of Rebuild Houston related debt per the ... finance department.”
In fact, the city’s debt is just as large today as it was prior to the approval of Rebuild Houston. While the city has paid down debt on street and drainage projects, the city administration has simultaneously increased the debt for other public improvement projects. Turner’s team says that more money to buy city cars and trucks has been needed, as well as astronomical increases in housing spending and garbage collection. The mayor's team is quick to point out that the city isn't borrowing any more money specifically for drainage, but it is borrowing money for “all manner of other public improvements.”
The end result is that the city still has a debt of about $2.5 billion for all public improvement. This is exactly what the city’s debt was in 2010 when Houstonians voted for the drainage fee. Brown says that it will be 2021 before this debt payment dips below pre-2010 levels.
In 2011, a group of Houstonians successfully sued the city over use of misleading ballot language for the drainage fee. The 2010 Proposition 1 asked voters if they supported a drainage improvement through a “dedicated fund,” but never mentioned that taxpayers would be the source of that dedicated fund via the extra water bill fee. Even with the shifty wording, voters narrowly approved the measure by 51 percent.
In 2015, the Texas Supreme Court ruled unanimously in favor of the plaintiffs. The city was ordered to hold a new election with clearer ballot language. But the city made a pre-emptive strike before the court ruling. The city council passed an ordinance formally implementing the fee, and stated that the Supreme Court ruling only weighed in on the vote and not the ordinance, so the fee continues to this day.
The lawsuit is still active, and plaintiffs say that they feel justice will prevail and that the 2010 election as well as the ordinance will be ruled invalid. If that happens, the city may be compelled to return about $840 million in collected fees. The city is sure that their ordinance will survive any legal challenges; one state district court has ruled in the city’s favor. The plaintiffs are sure that the Texas Supreme Court will overturn that ruling, just as they did in 2015.
Shortly after the drainage fee was implemented, nearly $1 million was apparently diverted from Rebuild Houston to Renew Houston, another fund designed to build new hiking and biking trails under Mayor Parker’s tenure. The funds were definitely co-mingled, making it difficult to separate out how the money was actually spent, but Parker remained steadfast that drainage fees were not spent on trail projects.
Even though the city’s own Rebuild Houston website says that these funds will be “placed in a dedicated fund” and “cannot be diverted towards any other city purpose,” the drainage fee money has been alleged to have been diverted to pay city salaries. Well-known Houstonian Bill King says that much of the documentation is missing on how the drainage money has actually been spent. King ran against Turner in the last mayoral election, losing by a slim margin. King says that records from 2012 were the last time the money was tracked closely. At that time, records indicated that the funds were being used to pay city hall bureaucrats, King said. The whole reason the city was even able to levy the drainage fee is because a Texas statute authorizes cities to establish a drainage utility, but requires the money to be held in a segregated account. King contends Houston has never done this. Instead, the money goes into the Rebuild Houston effort along with other funds, including Metro and even general funds. King reports six different funds, all with complicated accounting, and all with money moving here and there with little to no transparency. King also says that in 2012, the city moved nearly all of its 500-plus employee salaries over to the Rebuild Houston effort. In 2012, the Public Works head count went from 507 down to just 9 employees. The city says that “drainage fee funds are used on street and drainage projects and the employees who carry out the projects.”
How Does Flooding Factor In?
King and others state that homeowners were never told that the funds would pay for salaries. Instead, the funds were actually sold to pay for flooding. The advertisements in favor of the 2010 Proposition 1 were indeed all about flooding, and the ballot language did say the collected monies could be used for flooding. Advertisements said that the funds would be used so that Houston would not experience the flooding problems of 1983 and 2001. An excerpt from one of the commercials stated, “water got so high, police and fire couldn’t get through, and that’s why I’m voting for Proposition 1 to finally rebuild our streets and fix these drainage problems.” Naturally, opponents of the 2010 proposition feared the money would go to other projects.
What makes this all the more interesting is that the Nov. 6 ballot contains yet another drainage fee item on which to vote. The vote is not about whether the fee stays or goes. The fee will stay per the 2010 ruling and will stay in place while the lawsuit makes its way through the court systems. Rather, the 2018 Proposition A is a way to vote on how the fees are used.
“The only thing that we are doing with this vote is reinserting that lockbox,” said Turner, meaning the funds would no longer be diverted to other projects should voters wish for that.
Once again, the wording of the proposition is more than a little tricky. If you vote “no” on Prop. A, it is not a vote to repeal the tax. A “no” vote would remove restrictions on the way the fee is used. A “yes” vote would hold the city accountable to only use the fee on actual drainage projects – in other words, the city would have to spend the money the way it was originally intended to all along since 2010. A “no” vote would allow the city to continue to divert money to the general fund and use it for other projects that have nothing to do with drainage and flooding. However one votes, it is important to know what “no” and “yes” really mean.
Local residents Bob Rehak and Barbara Hilburn have been instrumental in Kingwood grassroots efforts to prevent future flooding. Hilburn has focused her efforts on improving area drainage, and has concerns about the underground outflow ditches and the new problems that appear to be occurring with even just heavy rain, like the tremendous pooling of water that happens in the front of Kingwood near the railroad tracks – a pool that Hilburn affectionately refers to as “Lake Randall.”
Rehak stated that Proposition A may be Kingwood’s best chance to ensure that monies are spent on things like additional flood gates for Lake Houston, and said that voting “no” on Proposition A would allow the city to spend money on other things.
Election day is Nov. 6, with early voting beginning Oct. 22.