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The Many Ways to Make $1.1 Billion Disappear and a Lot of People Unhappy

The City Council got its first look at how to divvy up $1.1 billion in next year's bond, and the resulting discussion somehow left us even less clear than we began.
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City staff would like to spend about half of the bond on street repairs. A community task force pushed for parks. Housing advocates pushed for housing dollars. And the City Council was in the middle of the fracas.

The Dallas City Council on Wednesday began the complicated, mundane work of sorting out competing priorities for how to spend $1.1 billion in next year’s bond program.

Voters will head to the polls either next May or November to vote on the bond propositions, for which the City Council was presented two very different funding plans. One was the result of 90 volunteers who served on community task forces and subcommittees, gathering public input over the last eight months and splitting the money between the various buckets. The other came from the city manager and his staff, whose work is generally the baseline for how the City Council considers divvying up the bond.

Those two bodies provided a pair of wildly different recommendations that caused confusion as to which the Council should be working off of. The marathon meeting Wednesday ended where it started, with a lack of clarity as to how this money will be spent.  

Arun Agarwal, the chair of the Community Bond Task Force, presented the community group’s priorities prior to city staff’s presentation. The community task force recommended a far higher spend on parks than what staff suggested ($350 million compared to $225 million, about a 34 percent increase than the 2017 bond’s allocation), basically cut a dedicated housing fund altogether, and stripped more than $150 million from the city’s streets proposal.

City employees recommended using about half of the bond dollars to fix up streets and infrastructure. The city has historically used the bond to chip away at deferred maintenance, and that bill has now grown to nearly $17 billion. The community task force favored projects that had matching funds attached and larger investments that showed a likelihood of generating a return on the city’s investment. The City Council was put in a position to sort all this out in real time.

“I feel that there was somewhat of a lack of cohesiveness to find some consensus and we’re being given a lot of numbers that really, in my opinion, makes more work for us,” said Councilman Adam Bazaldua, who represents South Dallas and Fair Park. “I thought this process was supposed to be designed to be more streamlined.”

City Manager T.C. Broadnax appeared to see the conflict coming before the meeting. Emails obtained by D Magazine show that he attempted to stop the chair from presenting to the City Council separate from his staff. “The notion that we would be rebutting the Task Force recommendation in real time, is not how this will be handled,” Broadnax wrote in an email last Friday to Agarwal, who is also the president of the Dallas Park and Recreation Board.

It was, in fact, how this was handled. Mayor Eric Johnson, who was absent from the briefing because of a “medical reason,” filed a memo on Friday afternoon that ordered the city manager to allow Agarwal to present “separate from any city staff recommendations related to the proposed 2024 Bond Program.” Johnson made funding parks in the bond part of his recent State of the City address, and parks took center stage even in his absence.

Meanwhile, the confusion at the horseshoe has appeared to set off consternation among the Park and Recreation Board; six of the 15 appointees to the bond task force also serve on the Park Board. They spent their body’s Thursday meeting on their heels, trying to figure out how to claw back some of the money the parks bucket appears likely to lose. They, too, don’t have a number from the City Council from which to map out a funding strategy.

“It was a dishonor to 90 volunteers who gave their time, and it seems like it was planned by staff like that because they did not even want to give me a briefing,” Agarwal said in the Park Board meeting on Thursday, a day after the Council was briefed. “They just wanted to have a briefing where I sit next to them and listened to what they proposed and I refused to do that.”

Staff recommended spending $534 million on streets and transportation, essentially the same amount that was allocated in the last bond in 2017. Public works officials estimate that it will cost $260 million each year to ensure that Dallas’ streets do not get any worse. Agarwal said the community task force opted to cap the streets spend at $375 million, because about $188 million of what was allocated for streets in the 2017 bond has not been spent.

“That reasoning is flawed,” said Public Works Director Robert Perez. He said the rest of that money is allocated but hasn’t been spent because of cost increases compared to the estimates from six years ago. The city has to find additional money to foot the final bill for those projects, but he said it will be spent in the coming years.

“I thought this process was supposed to be designed to be more streamlined.”

Councilman Adam Bazaldua

The city also wants to use a chunk of the bond to pay to resurface streets all over Dallas. The community task force saved a lot of money by removing those projects, arguing that they don’t meet the recommendation that a bond project have a lifespan of at least 20 years. Perez told the Council that resurfacing costs an average of $720,000 per lane mile, while a full reconstruction varies from $2.1 million to $3.7 million. Councilwoman Cara Mendelsohn was on board with removing resurfacing projects and using the general fund to cover it.

Funding resurfacing has precedent. The 2017 bond set aside $147 million for resurfacing out of the $533 million allocated for streets.

“For every $1 we spend resurfacing, we save $5 if we don’t have to reconstruct later,” Perez said.

Councilman Chad West, of North Oak Cliff, asked about finding ways to remove lane miles from streets that are too wide and dangerous. It would cost $100 to $800 to maintain two acres of greenspace that replace lane-miles. But this strategy wasn’t considered in either plan presented to Council. “Look at the cost savings when we take these lane miles off our books,” he said. “We need to be finding these roads wherever we can.”

You can see how things got unwieldy.

“I don’t like the fact that we’ve had to pick and choose priorities against each other instead of looking cohesively at what is going to move our city forward,” Bazaldua said.

The community task force cut its recommended housing spend to $25 million, a reduction from staff’s recommendation of $70 million and far below the $200 million that housing advocates have called for. Agarwal said this was because the proposal did not identify specific projects.

“There is no plan,” he said. “Otherwise that would mean just handing a blank check to developers.”

But interim Housing Director Cynthia Rogers-Ellickson said the city’s standard for subsidizing housing requires the issuance of what’s known as a Notice of Funding Availability, or NOFA. That alerts developers that a new pool of money is available if they wish to include affordable units in their developments. Staff recommended spending $75 million on housing, which some Council members asked to increase.

“We would put those funds into our existing processes now,” Rogers-Ellickson said. “This is strictly for development and infrastructure improvement.”

So what’s with all this back and forth? The city manager told Council that the task force was really for his own edification, to give him and his staff “more insight and guidance” into what the public would like to see. The community task force held over 30 public meetings in English and Spanish.

“It was always intended for me to utilize that feedback as well as my own and bring the recommendations back to the council,” Broadnax said. “We will walk away today, unless we hear otherwise, with the numbers from our recommendations.”

The bond debate gets philosophical quickly. How much should go toward basic upkeep and maintenance, and how much should be spent on items that generate additional investment? There are plenty of boring, essential things here, too: drainage and erosion control, upgrading “critical facilities,” helping the Dallas Museum of Art’s basement stop flooding. Everyone seems to agree that the bond needs to pay for a new police academy near UNT Dallas.

The parks boosters have projects lined up that will receive matching funding from organizations like the Dallas Zoo ($30 million from the bond, $70 million matching funding), Klyde Warren Park (wants $10 million, dropped to $6 million, with additional funding from other sources waiting in the wings to match), and the Dallas Arboretum ($4 million from the bond). There are playgrounds all over the city that need upgrading. There are a new few skate parks included in the pitch, at Bachman Lake and Westmoreland.

Other matters are more closely aligned. Staff is recommending $49 million to rehab cultural arts institutions that are owned by the city and managed by private operators; many are in disrepair. The community bond task force recommended $59 million.

But judging by the 121 public speakers who signed up before Wednesday’s discussion, parks and housing will generate the most public interest during the coming months of debate. This is the first year the city of Dallas has considered including housing in bond funding, which is also a reason the task force provided for ultimately recommending so little—there is no local precedent for the spend. But the housing effort follows cities like Austin and San Antonio, which in recent years have allocated hundreds of millions of bond dollars to leverage the creation of affordable units in private developments. (Austin used some of its bond money to buy old apartment complexes, which isn’t working out so well. Agarwal brought that up, but the city of Dallas has no plans to use housing bond money to acquire property.)

Instead, the community task force invested more in economic development than housing, targeting specific areas like Pleasant Grove, the International District near the old Valley View Mall, and UNT Dallas. Agarwal said each would ideally have “a housing component.”

The proposal supported by housing advocates goes far broader. It targets earners who make about half of the area median income, which includes a single person who make $31,150 or less or $44,500 for a family of four. It wants to essentially provide gap funding to developers who would include units in their otherwise market-rate development. The city does not track existing housing stock, but a recent analysis by the nonprofit Child Poverty Action Lab found a shortage of 33,600 rental units for residents who make this amount of money.

About 40 percent of the labor pool in Dallas make lower salaries working retail, service, and support jobs, which have a median income of under $40,500. CPAL found that the shortage will triple to 83,500 units by 2030 if the city does nothing.

“The community and the market will not create this deep level of affordability on its own, because it does not pencil,” says Ashley Brundage, the United Way’s executive director of housing stability and one of the lead organizers with the Dallas Housing Coalition. “You have to have some sort of subsidy to make that capital stack work for a developer to be willing to build them and not lose money.”

Brundage points to San Antonio and Austin recording a ratio of generating $9 to $12 of development for every $1 spent. Parks supporters point to an HR&A study that found an average return of $7 for every $1 spent on parks in Dallas. Agarwal believes the city needs to invest in quality of life improvements that make the city appealing to skilled workers.

“Employers are coming where employees are, and employees are going where museums are, where the sports teams are, where they have good living conditions,” he said. “If we have all that, we automatically attract the companies.”

But Council members want more information. The entire debate was steered by a lack of strategic priorities, a bunch of hands jockeying for space in the cookie jar. The meeting ended nearly 10 hours after it began, with some clearly hurt feelings and a lot of uncertainty—it’s not even clear whether there will be a funding plan in place by February, which is when the City Council will need to vote to get the matter to voters in May. Some on Council would prefer the bond be on the ballot in November, which gives more time to sort it out.

As for now, the clearest takeaway is that the mayor and City Council have a whole lot of work in front of them.

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Matt Goodman

Matt Goodman

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Matt Goodman is the online editorial director for D Magazine. He's written about a surgeon who killed, a man who…

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