Seaholm project for sale, renewing debate over its public use

Austin’s Seaholm project for sale, renewing debate over its public use

Shonda Novak – American-StatesmanThursday, March 24, 2016


The developers of the high-profile Seaholm project in downtown Austin are seeking a buyer for the hub of office, retail and restaurant space — a move that has reawakened debate over what the public benefit has been from the redevelopment project.

A potential sale of the nearly completed project has sparked criticism from some observers who say that what was built doesn’t live up to the community’s desire — and a former Austin City Council’s vision — for a significant civic use for the former power plant building.

“I think the city gave away the crown jewels,” said Paul Robbins, a longtime Austin environmentalist, referring to Seaholm and other former city-owned properties nearby. “We gave away most of that land to private development and didn’t get a whole lot in return.”

 

Energy in the News: Low income program still benefiting million-dollar households

Low income program still benefiting million-dollar households

By: Kylie McGivernUpdated: Feb 25, 2016 05:36 PM CST

 

AUSTIN (KXAN) — A city program meant to provide utility bill discounts for those in need is still giving money to customers who live in million-dollar homes.

“There is only so much money that is dedicated to the poor people, so it needs to go to the right people for the right reason,” consumer advocate Paul Robbins said.

KXAN first sat down with Robbins and Austin Energy about the issue in December 2014. All this time later, “There are still mansions on the Customer Assistance Program,” Robbins said.

Energy in the News: Utility takes steps to fix discount program

Utility takes steps to fix Austin’s bill discount program


After utility activist Paul Robbins exposed problems in the city’s utility discount program, with residents of higher-value homes being enrolled in a program designed to help poor people, Austin Energy has tightened up its screening process.

Ronnie Mendoza, who runs the Customer Assistance Program, said the old way erred on the side of enrolling people who weren’t a perfect match. But that old system also made it possible to enroll people who weren’t really eligible.

Austin Energy plans to further tighten its enrollment process by no longer automatically enrolling people who have homes valued over $250,000 (not including land value). Gutierrez explained the utility will send letters to people who are no longer automatically enrolled due to high home values and invite them to contact the utility if they believe they are eligible. They plan to implement that change in mid-October.

Energy In the News: Program intended to help poor sometimes benefits wealthy

Program intended to help poor sometimes benefits wealthy

Andy Pierrotti, KVUE10:07 p.m. CDT July 13, 2015

AUSTIN — A KVUE Defenders investigation uncovered an Austin Energy program intended to help the poor sometimes benefits the wealthy, too.

One of those multi-million dollar homes is located on Lake Austin. Real estate records show the home valued at $3.9 million has an elevator and a movie theater. Another home once enrolled in CAP is 8,000 square feet with eight bathrooms, and is valued at $3.7 million.

“If you’re going to spend large sums of money, you need to reassure it’s going to the right people for the right purpose,” said Robbins.

Energy in the News: Throwing money at problems is not helping Austin’s poor

Robbins: Throwing money at problems is not helping Austin’s poor

By Paul Robbins – Special to the American-Statesman, Monday, June 8, 2015

Austin has one of the highest, if not the highest, costs of living in Texas. The situation is so bad that, according to an analysis of Census data, many poor people are leaving the city, moving to surrounding areas because they cannot make ends meet. One would think that utility programs put in place by the city of Austin to assist low-income people are essential to helping these residents survive. When poorly planned, however, the programs waste scarce resources, providing reasons for fiscal conservatives to be cynical about their effectiveness.

Last fall, I investigated inefficiencies in a utility bill assistance program run by the city, the Customer Assistance Program, known as CAP. I discovered that CAP, which gives rate relief to low-income customers, was giving money to wealthy people as well as poor ones.

Over 1,100 customers in homes worth more than $300,000 were receiving CAP funds. While some of these were understandable, such as small homes in gentrified neighborhoods, many others were unmistakably wealthy. One 8,100-square-foot Lake Austin mansion worth about $4 million had its own indoor movie theater. Another CAP recipient owned 44 properties collectively worth $10.7 million.

This is one of several examples where Austin has thrown money at aproblem without thinking it through. Unfortunately, the list goes on.

CAP gives a 10 percent electric rate discount no matter how much a customer uses. While many people receiving assistance are frugal, some consume much more than average. In these cases, CAP is subsidizing waste. Assistance from the city should be going for basic needs, not to pay for luxury.

Another bad example is the city’s free weatherization effort to help poor people save energy. The federal government had a number of stimulus programs to get the country out of the 2008 recession. One of these gave about 2,000 Austin homes free weatherization and appliances, including central air conditioners.

While this may have stimulated the economy, it did not do much to lower bills. A survey of these homes showed so little energy reduction that the average payback on electricity savings would be over 59 years. You could literally give money away as rate relief and do better than this. The saddest part is there is a serious effort by some low-income advocates to expand this failure.

Yet another bad example is the utility’s debt expense. Austin Energyis losing $21 million a year from unpaid bills, much higher than two years ago. In late 2013, the Austin City Council was urged by some low-income advocates to come up with a lenient cutoff policy. The idea was, “Give customers extended payment arrangements, and you will get more of the city’s money back.”

It did not work. Nineteen months later, advocates are asking for still more time. Meanwhile, most people on these extended payment arrangements are getting further behind on their bills, some to the point where they will never dig out because their debt is so high.

The failures in these programs, taken as a pattern, do not inspire confidence.

The poor pay for these mistakes as well as the rest of us. Directly, they pay for failed conservation programs that save almost no energy. Many low- and moderate-income customers also pay for CAP, even when it goes to the wrong people. Poor people that are current on their bills pay for the bad debt of people who are not. In 2014, the lost revenue amounted to $48 for the average Austin residential ratepayer, accelerating the need for a new rate increase.

The poor also pay indirectly. If 10 percent of CAP is lost because of a flawed enrollment system or discounts for high consumption, that is $1.4 million a year wasted. Money spent on failed weatherization programs that save almost no energy is diverted from energy-saving programs that are effective.

If the city wants to help the poor effectively, it needs to stop throwing money at problems. Low-income assistance programs will never have enough money. The funds that are available need to be spent strategically and carefully.

Robbins has been a consumer advocate since 1977.

Water in the News: Water Treatment Plant #4 Commissioned

Taps flowing, but is there demand for Austin’s WaterTreatment Plant 4?

By Andra Lim – American-Statesman, Posted: 8:35 p.m. Friday, Dec. 19, 2014

At the grand opening Friday for a water treatment plant in West Austin, a trio of city officials raised their glasses and said “cheers” to a project that has often been the target of jeers.

Even as city officials toasted the facility Friday, they also admitted that the water demand projections that helped persuade a slim City Council majority to approve building the plant in 2009 didn’t come true.

The last thing Austin needed to do was build a half-billion-dollar water treatment plant at this time,” environmental activist Paul Robbins said. “We are up to our gills in overcapacity. No pun intended.”

Energy in the News: Utility discounts may be going to people who don’t need them

Utility discounts may be going to people who don’t need them

By Sophia Beausoleil, KXAN, Updated: December 1, 2014, 9:22 pm

AUSTIN (KXAN) — Keeping the lights on can be pricey, and that’s why Austin Energy created the Customer Assistance Program to help reduce utility rates for low-income consumers. But the discounts may not be going to the people who need them.

“I was particularly astounded when I started seeing $1 million homes and $4 million homes on the list and I knew the system needed to be corrected,” said Paul Robbins who has been a consumer advocate and environmental activist in Austin for 37 years.

Robbins said he had heard there were problems with the new automatic enrollment system and decided to check it out for himself. He put in a public information request for the participants in the Customer Assistance Program, reviewed their real estate assets and determined more than 1,100 customers in homes valued more than $300,000 were receiving utility discounts.

Energy in the News: Why Austin utility bill discounts aren’t just going to the poor

Why Austin utility bill discounts aren’t just going to the poor

By Lilly Rockwell – Austin American-Statesman, Posted: 12:01 a.m. Monday, Dec. 1, 2014

As a luxury home builder, Majd Hinedi lives in pretty nice digs himself. His 6,315-square-foot West Lake Hills home is valued at $1.2 million and sits in a cul-de-sac. According to online real estate database Zillow, it has five bedrooms, a pool and a guest house.

But…He is getting a discounted rate on his water, wastewater and drainage fees by being part of Austin Energy’s “Customer Assistance Program,” which is designed to give reduced rates and fees to low-income customers.

An analysis of water and drainage customers on the Customer Assistance Program by activist and consumer advocate Paul Robbins, who obtained the information through an open records request, shows that more than 1,100 people in this program — about 6 percent of the recipients — have homes valued at more than $300,000.

Energy in the News: Austin’s energy goals laudable but counter to laws of physics

Robbins: Austin’s energy goals laudable but counter to laws of physics

By Paul Robbins – Special to the American-Statesman, Posted: 1:46 p.m. Thursday, Sept. 4, 2014

Scientists and policymakers who study global warming are understandably panicked by the deterioration of the earth’s climate. Rising temperatures, increasing drought ironically contrasted with increased incidents of major floods, reduced agricultural output, and dying forests are all predicted as the damage spreads. In worst-case scenarios, billions of people could be at risk of a reduced quality of life, or much worse.

Many activists are desperate for action to eliminate fossil fuel use associated with carbon emissions. I share their frustration. Unfortunately, desperation does not breed good policy, and you cannot legislate physics.

An unfortunate attempt at such legislation occurred at the Aug. 28 City Council meeting, where advocates for clean energy won a commitment for 100 percent carbon-free electricity for Austin’s municipal utility by 2030 (assuming it is “affordable”). Currently Austin gets 23 percent of its energy from renewables.

As an advocate of clean energy for 37 years, it pains me to question this laudable goal, but without cost-effective energy storage, I do not see a way to technically achieve it.

Some people believe that Austin should retire or sell off its fossil assets and only buy renewable power. This scenario would have the Texas electric grid (ERCOT) sell Austin all the capacity to balance these intermittent power sources.

The problem with the theory is that Austinites may have to pay dearly for their idealism. Privately owned “merchant” plants can charge what the market will bear. Wealth would likely be sucked out of Austin, wealth that could go toward the purchase of clean energy equipment in homes and commercial buildings, among other things.

Also, the “affordability goal” for Austin Energy exempts fuel, so most renewable energy contracts will be loopholed since they are paid for in the fuel charge.

The essence of the carbon-free resolution came from a report issued by the council-appointed Generation Task Force. I invite anyone interested in Austin’s future to read this report. It is largely undocumented and has numerous flaws and contradictions.

  • In one place, the report advocates careful estimation of natural gas prices to ensure that a new gas generator is economic, while in another it advocates complete elimination of fossil fuel.
  • The report does not define if nuclear energy is carbon free.
  • The report has arbitrary or undocumented goals for increased energy efficiency, energy storage and solar energy.
  • Even if these arbitrary and undocumented goals are carried out, they are so small that they will not even compensate for the utility’s average growth rate, much less the fossil fuel we currently use.
  • Its section promoting more assistance to low-income customers is so flawed that it defines a household making over $95,000 per year as “working poor.”
  • The report’s obsession with solar energy from West Texas ignores the use of wind from the Texas coast, which is currently less expensive and generates considerable power during summer peak demand.

Fellow environmentalists have questioned why I would be so ardent opposing this supposedly benign resolution and in questioning the Task Force Report. It is because if clean energy supporters are to maintain credibility with the public, we need to explain the costs, benefits, and the current and future capabilities of the technologies as well as the environmental consequences of the current system.

For the next phase of Austin’s clean energy development, programs rather than arbitrary goals should be the norm. My own short list:

  • Create a storage “partnership” with other Texas utilities to develop various technologies while defraying some or most of the economic risk;
  • Create an “on-bill financing” program, similar to what has been done in four other states, to finance clean energy on customers’ electric bills instead of financing new power plants;
  • Since the current Generation Task Force is not inclined to continue to refine its report, appoint a sequel that will come up with a real energy plan for Austin’s future.

Robbins lives in Austin and has been an environmental activist for 37 years.

Government Accountability: Voter approval should be required for Austin debt

Robbins: Voter approval should be required for Austin debt


A July 20 American-Statesman editorial took issue with the Austin City Council for planning to issue bonds for buyouts of the homes of Onion Creek flood victims, since these bonds will be sold without voter approval. Upon reading the editorial, I wondered why the Statesman set its threshold for protest at such a low level. The Austin City Charter specifically states that all revenue bonds, including those that finance Austin’s electric and water utilities, be approved by the voters. Yet this Charter provision has been ignored for 16 years.

Article 7, Section 11 of the Austin City Charter clearly reads: “All revenue bonds issued by the city shall first be authorized by a majority of the qualified electors voting at an election held for such purpose.”

The tradition of utility bond approval by Austin voters goes back as far as 1890. However, this practice of voter approval began to be attacked for various reasons beginning in the 1980s.

In 1984, the City Council approved bonds without voter approval to finance the skyrocketing cost of the South Texas Nuclear Project. The council did this because the city was legally required to pay for cost overruns, and believed voters were so outraged by these overruns that they would not vote to keep up payments. The decision was taken to court, which ruled that the city had the right, but not the obligation, to sell bonds without voter approval. The public was so outraged by the episode that the City Council continued to seek voter approval for all other revenue bonds.

In the mid-1980s, several city purchases of buildings were financed with certificates of obligations, which are similar, though not identical, to revenue bonds. While technically complying with the charter, these transactions also raised hackles in the electorate.

Beginning in 2000, the city began purchasing large long-term supplies of renewable energy. These contracts were, in essence, virtual debt. However, they were not revenue bonds, so again, they were not precluded by the charter. Most of these transactions made good business sense and were good for the environment, but the expensive purchase of electricity from a biomass plant in East Texas is still controversial, and the complete terms of this contract have never been made public.

The last revenue bond election in Austin was held in 1998. There was no official reason given for their cessation after this. There were several contributing factors though.

1. A lot of bond money already had been authorized.

2. There was an economic recession in 2001, so growth-related expenditures were limited for a time.

3. The electric utility was over-collecting revenue to buy down debt so it did not need to borrow a lot of money.

4. Some public officials found it convenient to “forget” what was in the charter.

I began protesting their forgetfulness in 2006. The City Council-appointed Charter Revision Committee recommended in 2011 that this section be updated to mandate voter approval of projects costing more than $50 million. However, the City Council never placed the issue of voter approval on the 2012 Charter election ballot for voters to approve.

So here we are today, with a new water treatment plant exceeding a half-billion dollars in cost that will not be needed for a generation, a $2.3 billion biomass contract that continues to raise electric rates, and an acute affordability problem for the majority of Austinites. While voter approval of debt is not a panacea, it is part of a checks-and-balances system that needs to be resuscitated.

The new 10-1 City Council to be elected this fall could be a turning point to enlist more citizen participation in city government. I urge voters in the upcoming November election to ask candidates if we will be allowed to participate in our Charter-prescribed right to economic self-determination. Or will we continue to be ignored by a government that thinks it always knows best?