San Marcos Mercury | Local News from San Marcos and Hays County, Texas

May 19th, 2009
County contemplates capital projects, debt

A representative for MRB Group recently showed Hays County commissioners plans for a new building that would house the county’s Road and Bridge Department and Environmental Health Department. Photo by Sean Batura.

News Reporter

As Hays County employees cope with overcrowded workspaces and the Sheriff’s Office scrambles to remedy recently-identified violations of minimum jail standards, the Hays County Commissioners Court prepares to train its full attention on the county’s worsening facility woes.

Every member of the court has identified the same general remedy: a handful of capital improvement projects that could add up to about $150 million, and that’s not including $207 million in debt for road construction approved by voters last November, nor does it include $30 million in parks bonding approved by voters in May 2007.

In short, the court is faced with funding nearly $400 million in capital improvements. As the county’s present ad valorem tax rate stands at 45.5 cents per $100 of taxable value and commissioners have said they’d rather not go past 50 cents, they’re basically faced with fitting nearly $400 million of debt issue into roughly 4.5 cents of taxation.

In the coming weeks, the court will determine which projects will receive priority status and what funding mechanisms to employ.

“The unfortunate thing is the county has put off taking care of these issues for years, and now it’s coming to a head,” said Hays County Auditor Bill Herzog, who called the county’s justice center on Guadalupe Street “a disgrace” that on-site employees and the visiting public should not “have to put up with.” Hays County Judge Liz Sumter (D-Wimberley), who recently called the justice center “one of the worst spaces we have.”

Herzog, who has worked for the county for almost 25 years, said the county’s courts and District Attorney’s Office were relocated to the old H-E-B building about ten years ago on what was supposed to be a temporary basis until new accommodations could be found.

“It’s just drug on all these years,” Herzog said. “It’s gotten critical over there. There’s no room, and what room they do have is pitiful space. I don’t even know if the fire marshall would approve … There’s boxes along walls standing up — (it’s) a dangerous situation over there.”

A state inspector earlier this month found the Hays County Jail to be in noncompliance with Texas law in at least seven areas, some of which, she said, posed health, safety and security concerns for inmates, staff and the public.

“That jail is obviously in great need of major renovation — or, obviously, the answer to that is a new facility for Hays County,” said Texas Commission on Jail Standards Executive Director Adan Munoz, who presented his inspector’s findings to the Hays County Commissioners Court on May 5. “They could patch it up. It’s only going to be a band-aid effect — it’s just not going to be a permanent situation.”

Inadequate jail space has Hays County housing inmates in other counties, which, Sumter said, is much more expensive than keeping prisoners close to local courts and medical facilities. Unless the jail’s compliance issues are resolved within three weeks, the state will require all Hays County inmates to be housed elsewhere, at cost to the county.

The current and upcoming capital improvement projects soon to be scrutinized by commissioners court members include:

* An expansion or relocation of the county jail. Herzog estimates the cost at $40 million;

* Construction of a new government center on Wonder World Drive to house most county offices. Sumter estimates the cost at $100 million;

* Construction of two county commissioner precinct offices. Herzog estimates cost for a Precinct 2 building at $1.5 million, meaning the cost for two such buildings (the other for Precinct 3) could come to about $3 million;

* An expansion of the building on Yarrington Road to consolidate the Environmental Health and Road and Bridge departments under one roof. Architect MRB Group estimates the cost at $1.7 million.

The county already has spent more than $2.4 million in land purchases and professional services related to the government center project and more than $9,000 for professional services related to the Road and Bridge building expansion.

The fund for county building improvements contains at least $3 million, a portion of which was used for the recently-constructed Precinct 4 office, which cost more than $1.6 million. Up to $1 million may be added next year to the building improvements fund, which has been built into the county’s tax rate.

Precinct 1 Commissioner Debbie Ingalsbe (D-San Marcos) and Herzog said they hope the fund will pay for the government center and Precinct 2 and 3 offices, thereby eliminating the need to raise property taxes, or at least enabling a minimal tax increase.

“We’re not there yet — we don’t have the total amount,” Herzog said. “Part of the problem is, as we’ve waited the last few years, the building costs have gone up. We’re hoping we’re going to catch it as it’s going down. The interest rate’s great right now, construction costs are down now, and now is the time, I think, to take care of these issues before all that turns around.”

Funding mechanisms and cost savings that commissioners court members said may be used for the five capital improvement projects include raising property taxes, issuing certificates of obligation, issuing general obligation bonds, issuing revenue bonds, approving design-build projects, and lease purchasing and partnering with private or governmental entities.

Herzog said an expansion of the jail and the building of the government center will probably “have to be funded through some kind of debt or lease purchase mechanism.” Sumter, Hays County Precinct 3 Commissioner Will Conley (R-San Marcos) and Hays County Precinct 4 Commissioner Karen Ford (D-Dripping Springs) emphasized the importance of looking for partnerships to share project costs.

Conley said he is attempting to establish a new Precinct 3 office in a building to be shared with the City of Wimberley. Hays County Precinct 2 Commissioner Jeff Barton (D-Kyle) leases his office from the City of Kyle.

Barton, Ingalsbe and Conley identified completion of the government center as the county’s number-one priority project. Herzog said the government center will probably be complete in two years. County functions currently located in the Justice Center on Guadalupe Street will probably be moved to the government center, and the old H-E-B building will be sold.

Herzog said property vacated by other county offices moving to the government center will also be sold. Among them are the Maxine Smith Building, the courthouse annex and records building. Herzog said the mass office relocation will yield more revenue for the county as it puts property back on the tax roles and ends rental agreements. Herzog said the county is paying $10,000 a month in rent to house a probation office that will eventually move to the government center. Herzog said proceeds from property sales may be applied towards completion of capital improvement projects.

Ford and Sumter said completion of the jail and government center rank first among the county’s facility needs. Sumter has been alone on the court in venturing the possibility that all the county’s justice components, including the DA’s office, probation offices, courts and jail, could be housed in a single building. However, Sumter said a provision of the land deal that secured the government center site prohibits prisoners from being housed there, so a justice center would have to be built elsewhere.

“(The government center) wouldn’t be as big, you wouldn’t need as much space, and you would look for partners,” Sumter said. “I know that the Central Appraisal District is looking to expand. Their space is too small, so they might be good partners in building that building, or renting from us, which would help offset those costs … There may be other government entities that might want to partner with a new building — maybe they’re running out of space in San Marcos. So, I think we should have a government center. The question is, it just looks different. It doesn’t include the justice portion.”

Barton was unenthusiastic about the prospect of renting out space in the government center.

“I’m not sure we should be speculating inside that building on rental space,” Barton said. “I also don’t think we should be trying to directly compete with landlords and property owners in San Marcos. It may be that there’s something inside the center in the long run that you could maybe rent out — cafeteria space, (and) I’ve heard people talk about day care space — but I don’t think we want to get into the for-profit tenant lease business. There’s all kinds of people in that business already in Hays County and in San Marcos. They don’t need the government competing with them.”

Ford and Barton expressed skepticism regarding the idea of building a consolidated justice center in addition to the already-planned government center.

“I know there is the concept of having the jail and the justice center be all in one building, and some counties have done that, and it does give tax savings over time,” Ford said. “But I really think we need to just put a pen to paper and look at what that would really (entail). And we don’t have the land for that right now. We do have land for the government center … We do have land that the jail’s on. So I really feel like we need to look at those two things and see how we can use the land that we already have instead of backing up and putting on the search for land again. There’s just so long that we can wait and hold off. If there was a very strong, compelling reason, a financial reason, to wait and look at other options, then I’m certainly open to doing that.”

Ford said she needs more data before she can decide whether the jail should be expanded at its current location or constructed anew on site or elsewhere. Ford said she will tour the jail this week. Barton said the current jail should be rehabilitated and expanded on-site. Barton said choosing to rebuild the jail on a new site would be “a volatile thing to do,” as it would entail further delays in construction, have an effect on nearby property values and be more expensive than staying at the current site.

Regarding Sumter’s idea of consolidating all the county’s justice components in one building, said Barton: “I understand there’s clearly some synergy between courts and law enforcement, but there’s also some synergy between courts and all kinds of other departments. Do you want your courts and justice center that people go to to become more a part of downtown San Marcos and a public space? Do you want to help create economic development? Or do you want it to be next to a jail in an urban setting, as San Marcos is becoming? There are some costs to putting all those features right next to the jail. You save on transportation costs, you save on some things, but you lose some of that money and lose some of that synergy in other ways….”

Barton advocated taking “a comprehensive look” at the county’s criminal justice system before spending money on the jail.

“We need to think outside the box about how we process prisoners, who we keep in jail and for how long, how we move people through the courts system, even what types of crimes should call for arrest versus a fine-and-release — who should be kept over night and who should be let go,” Barton said. “We need to think about probation and court-appointed attorneys, and how to speed convicted criminals through our process and on to the state prison system. All these things could dramatically affect what kind of renovations we need at the current jail site or whether we need a new facility, and how large it should be.”

Sumter said ad valorem taxes may have to be raised by a penny this fiscal year. Depending on how inexpensively the county is able to build roads, the court in 2011 may elect to refrain from borrowing the rest of the $207 million in road bond money to avoid raising taxes. About $10 million remains of the $30 million parks bond passed by voters in 2007. Sumter said the two sets of $10 million already borrowed under the parks bond came in “were well under market.” Sumter said paying back the park bond money may only necessitate raising taxes by half a cent instead of a penny, depending on how the last $10 million is borrowed.

“So it could be as high as five (cents) and it could be as little as (a) two or three (cent increase),” said Sumter. “So, I think a lot of that has to do with what the costs of construction are going to be — and we hear that’s coming in lower than what was anticipated.”

Conley declined to speculate about whether ad valorem taxes may rise in the near future, saying he wanted to wait until he sees the certified appraised values, while Ford and Barton said a tax increase is possible.

“I would be a little surprised if we have to raise it four or five cents,” Barton said. “But we told voters that we might have to raise it that much, and I do expect that we will have to raise some additional revenues to pay for the bond debt the voters approved.”

According to preliminary property tax assessments issued by the Hays County Central Appraisal District, total property value in the county increased by a little less than $1 billion during last year to $14.16 billion.

“That $1 billion doesn’t count all the protests that are likely to happen this summer on some of the increases on some of the folks,” said Sumter, who plans on filing two protests. “And plus, I don’t think it accommodates any ag-exempt properties or wildlife exemptions. So until all that fleshes out, we really won’t know what that growth is. We anticipate, conservatively, probably an eight percent growth in capital value, which is really good for us. We’re probably not anticipating that next year … I think we’re in fairly good shape.”

Asked whether ad valorem taxes might rise to $0.50, said Ford: “I suppose it could. I mean, $90 million for a justice center — the figure that they gave the other day for the new government center was, frankly, a lot higher than I (expected). I was not anticipating that number.”

No commissioners court members advocated significant cuts in the county’s budget or said services should be reduced to accommodate upcoming capital improvement projects. However, Conley advocated “belt-tightening across the board,” Ford spoke of finding “ways to cut back in a lot of different areas,” and Ingalsbe said “department heads (should) be mindful of” the need to be frugal in “hard economic times … as we begin our budget process.” Sumter advocated establishing partnerships in new capital improvement projects as the way to cut costs. Barton was optimistic.

“We were conservative when we built our budget,” he said. “We were cautious in the way we projected our bond revenue. And right now, we’re in pretty good shape … We are not in any kind of a crisis situation. We’re about where we expect to be. And we’ll just have to be very careful. We’re going to have to be frugal, we’re going to have to look for ways to cut back or at least slow — save money where we can … This is not some shock to us. We have expecting this day to come, planning for this day.”

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0 thoughts on “County contemplates capital projects, debt

  1. The new government building on Wonder World Drive – what offices will be housed there? Property taxes are high enough now. Is this something needed desperately?

  2. As the article states, most county offices would be located in the government center. Office that would not be located in the government center include offices of the Sheriff, Precinct 3 Commissioner, Precinct 1 Commissioner, Fire Marshall, emergency management, environmental health, road and bridge, agriculture extension and personal health.

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