Claim: transparency, funding questions plague Houston drainage fee

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Houston drainage fee

The money collected from a citizen-funded drainage fee meant to protect Houston against flooding is being diverted to salaries and other projects, according to documents and an interview with a city leader.

The drainage fee was passed by Houston voters in 2010 by a slim margin. The fee is at the heart of a program called Rebuild Houston, which the city credits with improving streets and drainage over the span of more than 900 miles across the city. “This includes 573 lane miles of repair/rehabilitation and 349 lane miles of reconstruction,” a city website states.

Bill King is skeptical of how much of the drainage fee, which is charged to homeowners, is being spent on actual drainage projects.

“The truth of the matter is that very little of that money has been spent on drainage,” said King, who has run for mayor in Houston and is a well-known columnist.

In addition, King said that under the administration of Mayor Sylvester Turner, much of the documentation of how the drainage fee money is being spent has been removed.

Bill King
Bill King

In 2012, which was the last time this money could be tracked closely, “it was apparent that many of the positions being paid from the fund were not workers on the street but rather city hall bureaucrats,” King said.

Since the start of the program, ReBuild Houston has been controversial. Critics derided it as a “rain tax” and it has been the subject of lawsuits.

Indeed, one judge ruled in 2015 that the city obscured the nature and the cost of the drainage fee.

Later in 2015, the state Supreme Court found that the city failed to mention that the fund would be paid through a fee attached to property owners’ water bills and directed the city to hold a new election with clear ballot language.

But before the Supreme Court issued its ruling, the city council passed an ordinance formally implementing the fee, a routine legal process to enact the assessment. The city contends that the Supreme Court ruling applies only to the popular vote, not the ordinance. As a result, the fee continues in effect.

From a recent Bill King column:

In 2012, the City began collecting drainage fees pursuant to a Texas statute that authorizes cities to establish a “drainage utility.” That state statute requires that drainage fees be held in a segregated account. The City has never done this. Instead, it deposits the money into the Dedicated Drainage & Street Renewal Fund, more commonly referred to as Rebuild Houston.
The City uses two devices to obfuscate how the drainage fees are spent. First, they are commingled with other monies. The total income deposited in the Rebuild Houston fund has been running a little over $200 million. About half of that comes from drainage fees. The general mobility payments from Metro account for about a quarter of the money. The other big piece is a transfer from the General Funds which supposedly is equal to the amount that the City’s debt has declined because of the “pay-as-you-go” feature of Rebuild Houston… Of course, once these funds are all commingled it becomes much more difficult to sort out what money is being spent where.
In the ballot language and the advocacy leading up to the… referendum, no one ever mentioned that existing City employees were going to be paid from the Rebuild Houston fund.  But as soon as the City started collecting drainage fees in 2012, it moved 498 of its 507 Public Works employees to Rebuild. Below is an excerpt from the 2012 Public Works Department budget showing the its headcount going from 507 to 9!

City Hall said as much.

“Drainage fee funds are used on street and drainage projects and the employees who carry out the projects,” a city spokesman said. “The city’s annual operating budget does not list the funds as a revenue source.”

The city points to this link for proof of transparency in the program.

King disagrees with the transparency — as it relates to how the fee was sold to homeowners.

“If you go back and look at the old advertisements, it was one hundred percent about flooding,” King said.

King did point to “fine print” in the ballot language saying that the money could be used for streets or flooding.

But King called the drainage fee election a “bait and switch”

A lot of what the city is spending this money on, King said, “has nothing to do with flooding.”

“We’ve paid for dozens and dozens of asphalt overlays,” he said. “And yes, sometimes you need asphalt overlays because the streets are in terrible shape. But that does nothing to help with flooding, and in fact makes flooding worse, when you increase volume on the street.”

Added King: “To me, the huge red flag here is that the accounting is so complicated. Why do you need to have six different funds and move the money from here to there, and commingle them?”

Trent Seibert can be reached at [email protected] or at 832-258-6119.

29 COMMENTS

  1. I moved out of Houston, but still live in Harris County. This is one of the major reasons I built and moved out of Houston to Pearland. My old house in the Energy Corridor flooded when they opened the flood gates. In Pearland they pumped out the detention lakes starting over a week before Harvey and we did not flood. We got water in the streets which were built as the third layer of flood control, but our neighborhood did not flood. The Corp and the City of Houston did not drain down Addicks and between that and the silt build up you got the final round of flooding. When looking at the flood bond issue my first question was how much say does the City of Houston have in how it is spent, because if they have any, I was voting against it. The Houston Rebuild was a scam and the money went elsewhere, we need flood control work not City of Houston additional funding for whatever they want.

  2. I was give an IOU for my pay out when I left the employment of Houston as they said, Houston had no money at that time and I would be paid 33% each year for 3 years . 6 months after the drainage fee passed , I was called and said they had money to pay me off. They used drainage fee funds to pay off employed they owed. The drainage was just a lie to the public and a bait and switch by our local government officals

  3. I am so glad that I came across this article! Helped with my research! , thanks for sharing. Seems you have a lot of great content on the site.

  4. Years ago the Corp was holding town hall type meetings to inform citizens about the Addicks and Barker reservoirs condition . Long before any of these latest disasters.(Maybe in the early 80’s) Talked about the lack of upkeep that happened because of all kinds of reasons. I think they were built back in the 40’s with nothing being maintained since. Also stated the flood plain issue and how it is in their supporting documents that their advice has always been to not build in the floodplain or floodway. They do not control the building permits; that is all local leadership. The one I attended was over in the Katy area just when Cinco was being considered with just a few homes built. But lots of attorneys in the audience and lots of persistence. The Corp really did try to play politics about the purpose of the dams/reservoirs. Lots of long conversations about the questions ask but no answers….sure you have all been to those kind of official meetings. But as I said lots of attorneys were there with real determination for answers…And we were finally told that those two dam/reservoirs sole job is to protect downtown Houston no matter what other consequences might occur. They did stand firm that we needed to take up building in the floodways with local officials because all of the building had been properly permitted. And this still building continues so how long will it be before there will be massive loss of life??

  5. I know a lot of people and government reps who are valiantly fighting to do the best for Houstonians. Why all the hate? Be part of the solution, not adding to the problem.

  6. The developers are the ones at fault, and the city who give them permits like candy.
    DO NOT BUILD IN FLOOD PLAINS.
    But the greed is so tempting isn’t it….

  7. If you’re upset about what opponents of this said would happen coming to fruition, do yourself a favor and never investigate the Harris County Flood Control District or Harris County Toll Road Authority then….

  8. Hasn’t been implemented the correct way since the beginning, still not being administered correctly today and City hate when you tell them that they are not doing all that the fee is supposed to do and I can prove it!!!

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