Orlando, look what Texas cities have accomplished with bonds
The Metro Orlando Economic Development Commission took its 2012 Best Practices Leadership Mission to Austin, Texas, with the goal of “learning from their vast economic development successes.” Good idea. The October unemployment rate in metro Austin was 5.3 percent, compared with 7.9 percent in metro Orlando. If our unemployment rate were 5.3 percent, we would have more than 30,000 additional jobs for our citizens.
There are many differences between Orlando and Austin. One difference, probably not discussed during the EDCmission, is that Austin and other Texas cities have a strong history of using generalobligation bonds to help fund community infrastructure and facilities. We do not. This costs us jobs, time in completing existing and anticipated projects, and our standing in the rank of America’s bestperforming regions.
General-obligation bonds are used for projects such as drainage improvements and street construction, but also for facilities such as parks and libraries. They are paid off over decades from property taxes, and now at historically low interest rates.
On Nov. 6, voters in the city of Austin approved six proposals of a $385 million bond package. This includes investing in Austin’s creative economy by increasing space available for film and television production, and office space for creative and small businesses. Between1998 and 2010, Austin voters approved more than $1.2 billion in bonds, including funds toward a new downtown central library scheduled to open in 2016.
Dallas, Houston, San Antonio and other Texas cities also use general-obligation bonds. Dallas has used these bonds for upgrades to the Cotton Bowl to promote new college games and other events. It has earmarked $40 million in bonds toward economic-development projects in southern Dallas — its most underdeveloped and underserved area.
El Paso will be using $180 million in bonds for a new performing-arts center.
Texas cities also use sources of funding more familiar to us in their mix of funding for community improvements. For example, on Nov. 6, voters in Travis County, which includes Austin, approved a property-tax increase to help build a University of Texas medical school, obtain a site for a new teaching hospital, and expand health-care services.
El Paso citizens approved an increase in its hotel occupancy tax for a new downtown Triple-A ballpark.
Local governments in Central Florida have a weak history of using generalobligation bonds. The Orlando Sentinel reported in June that Orlando Mayor Buddy Dyer ruled out using property-tax revenues as a source of credit for Citrus Bowl improvements, citing a law that requires a public referendum if those funds were to be used to sell bonds.
This was the right decision, given the need to start work, and given the lack of a history of citizen involvement in helping to craft bond packages.
Bond packages in Texas are the result of extensive community input through citizen task forces, public hearings and other means. The successful Austin bond election this month started with a $1.5 billion wish list, and narrowed to $385 million.
Further, bond packages in Texas are presented for citizen approval every few years. Because of the process and regularity of bond elections, citizens there develop a history of considering trade-offs and making choices, and they develop a shared trust in using general-obligation bonds for public improvements.
Central Florida has made it to the forefront of American communities through public investments in our international airport, convention center, Medical City and community venues. To ensure our competitive position as a place to live, work and do business, we may do well to consider phasing in the use of generalobligation bonds to accelerate investments in our future — meanwhile creating thousands of jobs and reducing our unemployment rate.
Austin and other Texas cities show us that cities that plan ahead stay ahead.