Mueller Lake Park Outdoor Amphitheater
Mueller No Utopia
RECEIVED Tue., Oct. 3, 2006
Dear Editor,
The Mueller “utopia” is a great deal if you do not know how to do math, don't consider interest, and spin the project like the city, project managers, and neighborhood/environmental cartel have done [“Building Utopia,” News, Sept. 29]. It sounds better if you smoke some crack while you look at the balance sheet.
The land was given away, and the development cost is being paid for with city bonds. The zoning is a sweetheart deal at five-plus net residential units per acre (4,000/771 – not counting commercial and civic uses). No cost, no risk, and all profit. My house cats could make a fortune out of a deal like that.
Simple math – $48 million in bonds to pay development cost – $62,257/acre (or $652 million total cost at 4% over 20 years = $846,000/acre). The land should have been worth $200,000/acre or $154,200,000 (which would be worth $2.1 billion over 20 years at 4%).
The spin is that we have “utopia,” it pays for itself in only 20 years and is “gravy after that.” Actually we have one of the most expensive developments imaginable – close to $1 million an acre in city subsidies ($200,000 per lot). The reality is that the city could have sold the land to a for-profit developer, let the market drive the design (or give them the sweetheart zoning), and let them produce the same tax base in much less time, while paying the development cost. Tax revenue is the same or greater, and the city has $154 million in cash to pay for park maintenance, invest, or other cool stuff. It is all “gravy” from the start, just like all developments built with private equity.
The value of indulging the egos of goofy neighborhood groups, city bureaucrats, and blow-hard politicians all of whom believe they know how to create and manage development, may be “priceless,” but the real cost in dollars when you aren't squandering someone else's money is a complete disaster for taxpayers.
Mueller is a “model” for how to steal from the public and take credit for creating “utopia” without accounting for any of the costs.
The Mueller “utopia” is a great deal if you do not know how to do math, don't consider interest, and spin the project like the city, project managers, and neighborhood/environmental cartel have done [“Building Utopia,” News, Sept. 29]. It sounds better if you smoke some crack while you look at the balance sheet.
The land was given away, and the development cost is being paid for with city bonds. The zoning is a sweetheart deal at five-plus net residential units per acre (4,000/771 – not counting commercial and civic uses). No cost, no risk, and all profit. My house cats could make a fortune out of a deal like that.
Simple math – $48 million in bonds to pay development cost – $62,257/acre (or $652 million total cost at 4% over 20 years = $846,000/acre). The land should have been worth $200,000/acre or $154,200,000 (which would be worth $2.1 billion over 20 years at 4%).
The spin is that we have “utopia,” it pays for itself in only 20 years and is “gravy after that.” Actually we have one of the most expensive developments imaginable – close to $1 million an acre in city subsidies ($200,000 per lot). The reality is that the city could have sold the land to a for-profit developer, let the market drive the design (or give them the sweetheart zoning), and let them produce the same tax base in much less time, while paying the development cost. Tax revenue is the same or greater, and the city has $154 million in cash to pay for park maintenance, invest, or other cool stuff. It is all “gravy” from the start, just like all developments built with private equity.
The value of indulging the egos of goofy neighborhood groups, city bureaucrats, and blow-hard politicians all of whom believe they know how to create and manage development, may be “priceless,” but the real cost in dollars when you aren't squandering someone else's money is a complete disaster for taxpayers.
Mueller is a “model” for how to steal from the public and take credit for creating “utopia” without accounting for any of the costs.
Sincerely,
David Smith
Cedar Park
David Smith
Cedar Park
[Katherine Gregor responds: Certainly the city of Austin could have squeezed more money more quickly out of the Mueller tract. Due to its responsibility to a far broader set of public interests, however, the city instead prioritized the long-term civic good over short-term financial gains. While "the real cost in dollars" is always important, the cost to Austin of a missed opportunity on this once-in-a-generation site would have been, indeed, priceless.]
