Mayor and Council
City of Rockwall
385 South Goliad
Rockwall, Texas 75087
Mayor and Council Members,
I write for two reasons: (1) to showcase an “affordable home” community in Florida. It just happens to be George Zimmerman’s neighborhood, but this isn’t about guilt or innocence. This story is about the sudden decline of overpriced, jammed-together, high-density housing; and (2) to put a spotlight on the seriousness of municipal debt obligations.
Before the 2008 recession when Zimmerman bought his home, units were running $250,000. Post recession prices plummeted to $100,000 and underwater owners rented them out to what the writer of the below-linked article called “transient type of resident”. The writer says, “As the type of resident changed, so did the type of visitor”.
A second recession isn’t something I either want or invite, but I foresee it on the horizon and it could happen next year or it could happen next week. A couple of real estate analysts predicted the second housing bubble three or four years ago to happen around 2015. That coincides with the full implementation of the so-called Affordable Care Act.
As we move forward with “planned developments” that provide for high-density housing, I suggest we learn from other communities like Sanford, Florida and even nearby Richardson, Texas. – One major ‘blip’ in the economy and townhomes and condos will lie vacant and/or let out for rent, making for high-crime challenges.
As you start the annual budget process, I encourage you to think about indebtedness with the future in mind. News reports would suggest that California is deeply overburdened with debt while Texas sails along smoothly. Let’s look at the facts, debt as a percent of state GDP.
As you can see in the above chart, Texas aggregate debt is actually more severe than California aggregate debt, as a percentage of GDP. California finds itself the target of news reports, because all the reporters see is state spending, that which happens Austin. This is to say, Sacramento spends more than Austin. But, look where our Texas debt risk lies: right here in Rockwall, Rowlett, Houston, Dallas and every other city, county, school district in the Lone Star State. Texas debt lies right there in your hands. The only reason Texas debt isn’t national news is due to the intellectual laziness of news reporters. Our aggregate debt is outrageous, perhaps scandalous better describes our situation.
I did some research on unfunded pension obligations and extrapolations caused too much nausea to discuss that topic at this time. However, I ask you to critically examine our municipal pension obligations with an eye on the future. Is our pension system sustainable? Is there something you can or should do to ameliorate out local outlook?
A former mayor, back in 2009, likened the national economy to a ship, optimistically saying, “we’re in the crow’s nest”. I later reminded him that when the Titanic sank, that crow’s nest went all the way to the bottom with the ship.
Residents of the City of Rockwall can communicate with council members via email. Find all the email addresses at this link: Mayor and City Council
Rockwall City Council begins budget preparation on Friday, July 26, starting at 7:30 am, in the City Courts Building, 2860 SH-66 in Rockwall – This meeting is open to the public. Link to Agenda