Decison-making in The Woodlands - part 2

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The seven phases of a project are:

1. Proposal: overview of a proposed budget item, defining the problem, a solution, estimated cost and expected benefit. On large projects, this consists of substantial analysis and networking with people.
2. Defining the alternatives and selecting the preferred alternative. Refine cost estimate. Produce general plan. Select contractors for contracts needed in detailed planning.
3. Detailed Planning: define schedules, resources, contracts, execution plan with tasks, milestones, cash flow and other resource consumption. Refine cost estimate. Bidding and selection for execution contracts. Financing.
4. Execution: construction or development phase. Monitor cost and resources, manage contracts. Report progress and issues routinely. This is where the highest costs occur and what many people believe is project management.
5. Implementation: bringing the deliverables into their useful state to realize anticipated benefits. This is where success is usually defined, so that the next step can be executed at the appropriate time or times in the future. Measuring tools are put into place to monitor expected benefits. Project documentation for operation is generated. What went right, what went wrong, abstractly develop learning experience. This is where the project team learns from each other.
6. Operation: Start-up processes are executed, staff trained, operational budget is monitored. Benefits delivered to stakeholders.
7. Look-back: measuring success. This is where promises meet reality. It is where project manager and stakeholders can learn how to do the job better. It usually occurs months or even a year or two later, depending on the nature of the project.

A project can be effectively managed amidst other projects by a management team by using a gated approach. Between each phase of the project, stop at the gate to discuss progress and decide to proceed to the next phase or if more preparation is required first. The execution phase can be divided up into two separate sub-phases or even more, if the project is very expensive. All this sounds like excess overhead and it is sometimes, but it saves a lot of money and time in large capital projects. In small projects, one must decide what is appropriate for the value to be derived, not necessarily on the cost alone.

So why go through all this trouble in a government? Because the process allows stakeholders to participate and guide the results. It is a logical process where the stakeholders know where the project stands and where it is going at what speed. Even in a small community, the process should not the allowed to be lax. The community has few dollars and wants the results of their selected projects to have highest value, just like a large corporation. Due process does not to have to be terribly constraining so that nothing gets done. It just needs to be logical and able to be replicated.

This will be continued in part three.

Let's Talk Incorporation

Sometime or another we need to start talking about this subject. Might as well be now. I have leaned toward incorporation for our community from the time I came here. That inclination has never been abandoned. However, the cost of doing that will probably drive my final vote, if it ever comes to that. In the meantime, you as well as I need to understand where we are and where we are going, relative to any futuristic vision that includes incorporation of our community.

The Woodlands Texas is engaged in a two-pronged transition. One prong got off the ground a couple of years ago when the community voted to form The Woodlands Township. This prong was intended to develop an interim government until we can decide on a permanent one. The township could be a permanent form of government, but many doubt it will serve us very well in the long term. For now, we are changing from an association-centric community to a special-district governed community. The primary difference between the two is that the special district acquires revenue via taxation, whereas the association acquires revenue through a fee. Another notable difference is the much smaller number of township representatives from the community engaged in major decision making. And similar to municipalities, this difference also affects the number of residents who are involved in the decision making processes of the community. From a tax perspective, the new government won't be much different in that our fees have always been based on property assessments, basically the same as our new government, starting in 2010. The primary difference is in tax exceptions. Abatement to corporations will be part of our tax structure if we get legislation this Spring, but abatement to homeowners will not, except for veterans and perhaps the elderly and disabled (I do not like to use that word).

The other prong is our long term solution. This subject is discussed in many circles but action is dormant for now until the first prong is settled. What will the government look like after 2014, the year in which we can first apply for incorporation?

That is the sixty-four thousand dollar question and the reason I have written this article. Will we look like Oak Ridge (inc 1979) or Shenandoah (inc 1974 by de-annexing The Woodlands) or Conroe (inc 1904) or Tomball (since 1800's)? Those are our closest neighbors who incorporated decades ago.

If we are to shape our community into one that we want, we must participate in the spirit of a hometown, something similar to Tomball's vision approach for their downtown district. Those stakeholders, those who live there, are openly invited to participate in determining the future of their downtown area.

So what governing components do we have today versus those of a municipality? That is a starter to consider. So I have generated a comparison table as a basis to begin this consideration.

Special District	Function	Municipality
Board	Tax representation	City council or equivalent 1
Manager	Business management	Mayor and comptroller, or city manager
Contract	Garbage and Waste	Garbage division of city services, contract optional
None, deferred to County & State	Legislative	City council 2, county commissioners and state legislators
None, deferred to County and State	Judicial	City, county and state courts 3
MUD district	Water & Sewage	City department
District fire services	Fire & EMS	City fire & EMS services (same)
Contract	Law enforcement	Police department, contract optional 4
Contract	Parks and recreation	Parks and  recreation department, contract optional
???	Charter	Home-rule or General Charter 5
None, Deferred to County	Health	Health Department
None, deferred to County	Regulatory Domain	Zoning, buildings, signs, nuisances, and subdivision development
Ad valorem tax & district sales tax  & borrowing (bond sales)	Revenue sources	Municipal sales tax, property taxes, occupation taxes, fines collected by the municipal court, fees imposed for utilities such as water, solid waste pickup, waste water, etc., state and federal revenues, and borrowing (bond sales)
Only through state legislation	Annexation Powers	Unlimited within 5 miles of city limits, assuming the "home-rule" model 6

 

Table notes

^1,2An alternative is a City Commission where city administrators manage legislative duties as well as direct reports (employees).
³Required to enforce city ordinances. There may be some room to contract this function to a county court.
⁴This service is considered by many to be necessary to us by the Township employing policemen, but we should also be able to contract the service out to county law enforcement agencies, if the contract includes enforcement of city ordinances.
⁵Texas has a default charter for small cities that is sometimes utilized in the absence of a city charter. "Home rule" implies that a written city charter exists.

Some thoughts about the variables and what might occur in the community as we debate a new government:

• Policing our community would likely be a hot topic when considering a new government. Some folks want our own police force. That means a payroll, asset management, local enforcement techniques, control processes, ethical guidelines, etc etc. I have a story to tell about city police forces, but it will wait until another article.
• Ordinance making would also probably be a very hot topic. Right now the "shoe" is made to fit the county. Our community is vastly different than the rest of the county. It seems only right that we would have our own ordinances so the "foot would fit our customized shoe" properly. But when this is debated, we are almost sure to discover things that we have not thought about before.
• Manager or Mayor? It is not clear what path we would take on this. There will be varying opinions and reasons to have one over the other. I expect this to also be a political mine field.
• Council or Commission? This will not likely be a hot topic but it could. Most people envision and assume a mayor/council type of municipal government purely because they are accustomed to it.
• Home-rule or default charter? I think the home-rule will dominate but who knows? Most cities in Texas defer to the default state-defined city charter.
• Representation - by the people (at large) or by the village or both?
• Service Company - continue to contract or build allegiance through full time employees? This will certainly be a hot topic. Many will want to continue as before, but costs and allegiance issues may drive the model to an employment one.
• City Hall - a process is underway now to study this and come up with a recommendation and decision. This is being driven by the timing of land development and availability of resources. We could be forced to have the cart before the horse.
• Water - here is another $64,000 question. We are in the midst of change. The area has grown so fast that it is steadily depleting the underground water reservoirs. We must transition to surface water. That will be another large capital expenditure which may prevent us from having a city water system, or it may have the opposite effect. This is an issue I would like to pursue further. In addition, typically, a city manages to acquire additional funds through service fees which are "hidden" in the water bill (last I saw, the bill is high in Houston with just fees.) This is the type of thing one must watch out for when choosing a municipality model for a government. Residents often pay additional fees on top of taxes.
• Mass transportation and traffic management - it is inevitable that we must move to improve transportation within the boundaries of The Woodlands, but how will we do it? We face many issues, and it is unclear how we will solve them.

Finally, for now, we need to examine ourselves to see if we have an open mind. The Woodlands continues to be very unique in Texas. Modeling our town after Tomball or Conroe or any other small town does not see to me to be a good idea. We need to take it from the top. That requires careful thinking about what we want our service and jurisdiction table to look like in order to best serve this community. Again we need innovative thinking, not necessarily creative, not emotional, but logical and fact driven. If we go for incorporation, we may face significant political resistance in Texas by those who feel threatened by full incorporation.
References
1. City of Sweeny - Government defined

Woodlands Payment to Houston - Where is that money going anyway?

These are the projects that we are helping to fund with the capital provided by the recent bond sale and probably with this year's sales tax payment to Houston. I have wondered about these projects ever since we signed the agreement with Houston, so I have done some research to share with you. Chime in if you have additional information to share. I ask myself the question, how will we and the region benefit as a whole from our investments?

You know, there is no guarantee that residents of The Woodlands will benefit in any way from these payments, but to be fair about it, Houston is willing to put our money exclusively into projects that benefit the region's shared use of facilities. You can see the rationale when you peruse the projects below. These are included as part of the infrastructure improvement program of the City of Houston. They are considered to have regional benefit, including Houston proper. In simple terms, for now, our money is targeted to benefit the users of the medical center and major parks. These projects were included in the original agreement between The Woodlands and Houston and have been programmed into Houston's 2009-2014 Capital Improvement Program (CIP). All the project names below are in the Houston Capital Improvement Plan and were included in an attachment to their agreement with us. In 2008, Houston asked the township to approve them in a separate memo, according to the process of the agreement, which we did.

The Agreement with Houston; these are the exact project names in the agreement

1. Herman Park - $200,000
2. Memorial Park Pedestrian Bridge - $500,000
3. Lake Houston Park improvements - $4,500,000
4. Holcolme Reconstruction ² - $3,723,000
5. N McGregor Way Reconstruction - $2,600,000
6. Cambridge Paving - $400,000
7. Bayou Drive - $3,800,000 (apparently a new road)

In addition, there is another project not listed but already underway.

• Hardy Toll Road Extension - $300,000,000 (We expected to contribute $5,000,000 during the project execution. This is a multi-year project, and was targeted for completion in 2011, but more likely in 2012. There is a lot to it, including the permanent closing of streets.⁴

What I have been able to discern from research:

Herman Park
There are several projects underway for this park according to the City of Houston's website.¹ Our money is designated for one particular planned project. Supporting the park is worthwhile to us. Our residents do visit the zoo and other facilities in and around Herman Park and many of their projects do affect our residents, although I would think in a small way. The park's capital improvements over the 2009-2013 plan amount to $2.5 million, with The Woodlands contributing some $700,000 to that plan for 2009-2014 through our initial payments.
Memorial Park
Memorial Park is used extensively in the region, but not likely by most residents of The Woodlands. It is shared regionally. We are not a very big part of the benefactors of this large park. Memorial Park Pedistrian Bridge is found in the Houston capital budget for $4,158,000. We fund $500,000 of that. Ground breaking occurred just recently. The scenic bridge will be covered in greenery and is intended for safe pedestrian passage.
Lake Houston Park
Lake Houston Park Improvements - $4,703,000. Some of us could be users of this 5000 acre park over time. It is the closest to us of all Houston's major parks. It has no frontage to Lake Houston, so there are no boating ramps to or on the lake. There is access to Peach Creek and Caney Creek, both of which empty into Lake Houston just north of Kingwood. It is close enough for a pleasant day trip from here, offering fishing, canoeing, horseback, biking and a nature center. George Mitchell funded the nature center. "The first phase of our development of Lake Houston Park will be an entry gate, roads, visitor center, parking, cabins and more campsites" to be completed in late 2010. This is one of the more interesting projects to me. Lake Houston Wilderness Park is part of Houston's Capital Improvement Project program supporting the Kingwood area. Now you see the story. Kingwood annexation by the City Of Houston was the primary reason we organized to fight annexation. So our payment to not be annexed is in a large part going to help the Kingwood area. How do you like "them apples"? This park became part of the Houston parks system in 2006.^7,8
Holcombe Reconstruction
This medical center project will provide better drainage and traffic flow on Holcombe Avenue. At the beginning of 2009, the project was in phase 3 of 4. At the end of this, the street will be repaved with a better mobility configuration. The last stage will be to improve water transmission to the medical center. 57 trees of 283 will need to be removed, but the project will plant 80 seven-foot trees in their place. ⁵
N MacGregor Way Reconstruction
There is no project by this name in the Houston capital improvement plan. However, there is one named N MacGregor Way Realignment, which is safely assumed to be the one referenced. The Houston Zoo web page shows the two names synonymous. This project was budgeted for 2008 but continues to be a work in progress. It realigns the roadbed with S MacGregor Way to make 10 acres of valuable unused parkland available to the public and also makes the roadbed available for a wide path or riding trail. It has a beautiful archway of trees along both sides of the roadway. This $2.6 million investment is tagged as a mobility project to improve traffic flow to the medical center and Hermann Park.⁶
Cambridge Paving
The capital improvement plan has this as "Cambridge Paving: Holly Hall to IH 610", a $2.1 million dollar project, $400,000 of which is budgeted in 2009 (our payment), to be completed in 2011. Scope is approximately 1,600 feet of Cambridge Street to a four-lane concrete roadway with curbs, sidewalks, street lighting, and necessary underground utilities. This is also a mobility project, to provide less congested access from Loop 610 to Herman Park and the Medical Center. It widens the narrow Cambridge road to four lanes.
Bayou Drive
Tagged as "Bayou Drive: From South Street at Myrtle to Quitman" in the capital improvement plan, this 5.9 million dollar project begins in 2009 and ends in 2010. I was drawing blanks on defining this project until I found myself physically at the Medical Center, where I noticed a sign advertising the project. I will update this article when I find out more. It was a 3.8 million dollar black hole of Woodlands money until I discovered the sign where the road will connect. I could not find this project on Houston's website or any other source. It has to be out in internet-land somewhere.

Hardy Toll Extension
This $300,000,000 project is four miles of railyard, residential area and integration with Elyssian. It is being designed in 2009 and construction should begin in 2009-2010. Houston has tagged $5,000,000 of our dollars for this project, but it is not listed in the regional project list they sent us. This one has high relevance to resident commuters traveling into the Houston downtown area. I may be out of date on this one. Funding seems to be as a toll road, not as a public sector financed road. I am seeking clarification of this as well.

I noted a lack of recognition that The Woodlands is funding some of these projects. I am not sure why, perhaps political.

References:
¹ 2009-2013 Capital Improvement Plan City of Houston, Parks and Recreation, form "E"
² 2002 study "Transportation Master Plan for The Greater Texas Medical Center Area"
³ City of Houston Mobility Capital Projects ⁴ Houston: Hardy toll road extension gets final approval
⁵ Holcombe Blvd with drainage map
⁶ 2007 City Council Notes, p 11-12.
⁷ Kingwood The Observer "CIP meeting in Kingwood discusses future projects", Feb 2009
⁸Lake Houston Wilderness Park - official site

Decison-making in The Woodlands - part 1

I have been saying for a while that I have a position which calls for due process in our decision making. It is time to explain that a little. My background as a professional project manager makes me more aware of this matter than many people, yet most residents understand this conceptually. I call the core of the value presented in due process, with respect to our money, "capital stewardship".

When we elect a public official, we elect them as stewards of capital, whether it be the budget of the Township, the Association, county, MUD district, school district, or state. But capital is not always measured in dollars either. We give stewardship to individuals to maintain the value of our homes through home and property maintenance standards as well when we elect RDRC residents.

Our expectations are that those who are given stewardship in our governments, assume responsibility for their decisions and become accountable for them, as if it were their own money.

Now I would like to put this in the context of project management. Project management is an organized means to dutiful stewardship. Some people mistake the term to mean "on time and on budget", but that is a totally false perception. It means taking responsibility for all the decisions from beginning to end, which minimizes risk to stakeholders and which provides the right deliverables to the right customers at the right cost at the right time. I can go into this at great depth, but only want to get the bare essentials out in the open at this time.

Sometimes projects are defined from the wrong direction. The solution (or deliverable) defines the problem. You will see what I mean when we discuss incorporation of The Woodlands at a later date. Project management is a process which needs to begin with a clear and relative definition of some problem or issue. If I don't see that clearly defined and I hear about solutions, it immediately raises a red flag to me. "It is a solution looking for a problem."

Projects provide value. If the value is not defined and cannot be compared to the value of another project, our capital is not being managed. One cannot manage if there is no perception of relative value. Without value, there can be no investment. Investments yield returns and before one goes to spend our money, they must tell us the value of their proposal.

So we have defined two critical parts of a project proposal - definition and value. They may seem obvious, but I have seen them forgotten several times in my lifetime. A proposal goes much deeper than these two items of course. There are actually 6 phases of a project. I will tell you about those in another article.

Legislation for The Woodlands Township

postscript at bottom added 01/30/09
I don't know about you, but I for one, have been concerned about the ability of the Woodlands Township to fully transition in 2009. There are a few basic legal hurdles that need to be leaped for us to pull through the transition by 2010. Our township board has most of them, if not all, outlined in a legislative wish list and prioritized. ¹

1. Tax Abatement - this is a very important item and is considered essential by the board to proceed as planned. There are about eight businesses with abatement contracts here. What is our contingency if we cannot honor these by law? I have not heard of any. The township must be able to continue to provide the abatement contracts by law. Otherwise, we would not be able to execute our taxation plan. We would be on hold until the next session of the Texas State Legislature. The urgency is quite apparent.
2. Quorum of the board - in May, 2010, we will fill the last of the elected board members and go to a seven member board. It will be very difficult to have all board members there for every meeting. This is also considered an essential change to be able to operate.
3. There is another essential item, but perhaps we can manage without it. We cannot directly employ fire fighters because of its union and the legal requirement for a vote among the citizens served prior to doing so. Right now we have a separate legal entity employing our fire fighters (our fire department). There may be federal legislation trumping the state law on this soon, so its importance could be reduced, yet we cannot depend on anything outside of our control. Waiting an additional two years for exception legislation would not be a great idea.
4. Covenant Administration - The lack of legal definition on this matter will likely force the association to remain in place, yet it is considered to be a non-essential item in the draft documents provided to the board of directors from the Governance and Nomination Committee. The Township will need to take over this function if the association dues are to be levied by the township in the form of an ad valorem tax. It apparently does not have authority to perform this function yet. This could be a sticky issue.
5. There are a few minor ratifications that would be helpful but not necessary. The one area I wonder about is the conditional exclusion of the Harris County parcel. It is in the non-essential section. I am unsure how this falls out but it certainly sounds urgent.
6. Also, there are a few financial issues that should be clarified/included, but are probably of minor consequence.
7. A very important issue is the dissolution of the Township and enabling a replacement government. We know that we should not depend on legislation in any given session. The legislature always has its hands full. One cannot predict where Texas politics will go on any issue. Any one session can be full of politics, and we may not have the leverage to get what we need out of it. We must have legislation to be able to prepare a municipal charter. Without it, we will have to wait until 2011 or 2013. Our political leverage may be over by 2011. This needs to be brought forward now in my opinion. We need to have the option to go forward with planning municipality in 2011 and know that we can do it, before we spend a large amount of time on a final form of government project and discover we cannot get the appropriate legislation passed. We should have learned enough lessons in the current government change, to ensure that we plan far ahead next time, leaving sufficient time to correct issues we find along the way. We also know that the strategy in leveraging our representation in the Senate and House should be to utilize our strength while we have it. The session is short and only comes every two years!
8. Additional legislative issues include tax exemption authority. This is an important item for certain groups of residents. Shenandoah has asked to play a role also. Delinquent assessment authority by the county has not been settled either. Whether we can legally act on delinquency or not, needs to be settled to avoid the cost of lawsuits and to enforce our covenants.

From my seat, we need all of this taken care of in this session, but then again, I am not a lawyer nor pretend to be. I hope we get all township gears engaged in 2010. The legalities of all this is like spaghetti. It seems to get all tangled up in the pot.

Postscript: What is missing? We cannot levy ordinances nor have a court system. Therefore, we must use county ordinances. Since we have two counties, The Woodlands will live under two sets of legal rules until we become a municipality or we get legislation to be one. This limits what we can do to achieve the quality of life we all expect. For one, we need a noise ordinance for barking dogs, loud cars and trucks. I am sure we can come up with other issues needing an ordinance. Adjoining cities have such ordinances and here we are allowing about anything, as if we were out in the country, and of course we are not. Yes, we can have rules, but that does nothing for the more needful situations.
References:
¹Draft 2009 Legislation Agenda for The Woodlands Township

Vision of The Woodlands Future depends on scope

Just like any government, the township is now embarking on establishing a new vision, to drive future policy and strategy. We as residents or as proprietors of businesses in the township should pay close attention to this activity. This past week, the executive committee voted to recommend consultants be hired to facilitate the development of such a future vision.

This vision must be all inclusive. It cannot be short-sighted; I do not personally believe our township leaders would allow it to be such. The vision must include certain priorities of the residents. I will list a few possible priorities that readily come to mind.

• Township must have a vision that includes an option for being a municipality.
• Ordinance capability must be a part of its vision.
• Court capability must be part of its vision.
• Role of the village associations and resident representation.
• Policing the community.
• Fire protection.
• Traffic expectations within the boundaries of the community.
• Tax regimes - retirement and elderly tax breaks plus controls on spending.
• Property value and assessments - relates to resident's worries about being able to live here or not in the future.
• Development and zoning.
• Assumed roles of county vs roles of the interim and long term government.

This is a start to consider the definition of the scope of this project as I see it. Of course I have not addressed the business issue list in this. I know some shop owners; they have issues that need to be addressed as well.

So perhaps you have something to add to this or to contest with this list? I can safely say that I am not interested in doing away with Walmart, as the recent study suggested that is high on the resident's list. That is not on my list. I am still reeling with total dismay over that conclusion!

Woodlands Government Bonds for Refinancing Payment to Houston

Well, as the board promised, we have now refinanced the payment to Houston by way of government bonds. This was an extensive effort that was initiated months ago. The bond issue report is very large and has a great deal of data supporting the strength of the community and the rationale for the timing of the bonds. Right on its heels is a bond decision by the Conroe ISD to issue new bonds and refinance existing ones to save some money. Now was the time to act and the township was ready.

As it turned out, over the week before the sale, things changed fairly significantly, showing the need to act quickly in the market. For one thing, some of the wholesale brokers decided not to buy the bonds. Citibank and Merrill Lynch both dropped out. However, Edward Jones came to the plate swinging and bought in to the full near-$18-mil value. As it is, the retail structure that Edward Jones offered saved 0.2 points over their competitors, but fees more than make up the difference according to our consultant

The community fared well in the outcome by using the consultant Drew Masterson of First Southwest. He has been working with us for months on this; we have been poised with great detail, to act on his queue to do so. Although we did not get the bonds sold at the lowest market price of the week, we did manage to get a 4.96+% All-in-True rate, just 0.3 points off of the low. Reviewing the trends of the bond market, revealed a downward trend until this past week when it turned around indicating a probable bottoming of the rate. Using what I believe to be an institutional means, a local MUD did better this past week at 0.5 points below us. The yield map of our bonds ranges from 1.25% at one year to 4.5% over 11-12 years. The bonds mature in 2022(50%)and 2023(50%). For a 10 year bond commitment, a yield of 4% is achieved.

I tried to sort out the rationale of the ratings. This is what I heard and I believe to be near correct. Although we are rated at A+ by S&P, the bonds are priced with the Moody index of A3, because of a technical issue with an assessment technique.

To fully execute, the loan to Woodforest bank will be paid next week on receipt of the payment by Edward Jones. There will be no overlap of interest. This waiting period for lower bond rates and financing the payment to Houston by a temporary loan from Woodforest Bank has proven to be a good strategy by the township board. Had we issued bonds in the fall, the bond rate would have been about 6.5%. That is a $1.0+ million dollar saving over the maturity period. I would like to congratulate the board for their prudent management of our money.

I called Edward Jones on Friday to purchase some bonds, while they were still available. One-half of these tax exempt 10-year bonds were already sold by the time I called. I have now invested in our community. Why would I do this at this low rate of return? Because I believe in the economy of this area, that it will be a stable and secure investment during the current economic crisis. I can put money out there for ten years and so I did. Tax free income will be generated, making this an equivalent to a 6.0+% taxable bond yield. Short term bonds likely have cash flow advantages also, depending on your own personal situation.

The contract is found at the township website : Edward Jones 2009 issue. You will find a table on the rate of return for each year at the end of the document.