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September 2009

AUGUST REVENUE (in millions): SALES TAX: $1,755.9 OIL PRODUCTION: $69.5 NATURAL GAS: $53.0 MOTOR FUELS: $259.5 MOTOR VEHICLE SALES: $233.3 TOBACCO: $182.5

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INSIDE

• Fiscal Notes Home
• Getting
  (Not Too Far)
  Away From it All
• “Exurbs” seek the best of both worlds.
• A Letter from the Comptroller
• *Home By Any
  Other Name
• Rent or Own – the Eternal Question
• New Directions Home
• Retirees Roll into Texas
• Country Oases
• Four rural counties thrive on their own
• Cities Within Cities
• “Lifestyle Centers” for Working, Shopping, Living
• New Money for Conservation
• State energy program gets stimulus funding
• Brief Bytes
• News Shaping the
  Texas Economy
• Texas by the Numbers
• State revenues, expenditures and
  cash condition
• Free at Last –
  and Sooner
• Tax freedom day comes early in Texas

WEB EXCLUSIVE

• Housing for Everyone
• Low income housing challenge sharpened by disasters, downturn

* denotes expanded web version.

”Exurbs” seek best of two worlds.

by Mark Wangrin

Nestled among the upper Highland Lakes, with scenic rolling hills and gorgeous vistas, Burnet County has long been a desirable place to get away from it all. Now, with the explosive growth of nearby counties, these open spaces have become more than just places to relax and unwind. They’ve become home for thousands of Texans who commute to urban areas to work.

According to the Texas State Data Center, Burnet County is Texas’ fastest-growing rural county — meaning a county that is not part of a federally defined metropolitan statistical area (MSA), such as the eight-county San Antonio MSA. And it highlights a Texas trend: the migration of working urbanites past the city fringes and suburbs, and into areas where scenic beauty, a slower living pace and lower housing costs outweigh higher transportation expenses and lengthy commutes.

Such areas include Hood and Somervell counties, near Fort Worth; Polk County, north of Houston; and Lee and Blanco counties, situated like Burnet County near Austin. All grew substantially between 2000 and 2008, in a period when most Texas rural counties saw little growth or actually lost population.

Burnet County Judge Donna Klaeger, a former head of the Marble Falls Chamber of Commerce, is seeing the change first-hand.

“When I moved here, [Marble Falls] was still a small, hometown community. Everybody knew everybody,” Klaeger says. “Because of our proximity to metropolitan areas and who we are, it’s changed drastically. There are so many residents who’ve moved here because it’s a beautiful vibrant community. As our motto says, ‘Relax, you’re finally here.’”

For Klaeger and other local leaders, though, Burnet County’s 27.2 percent population growth from 2000 to 2008 — nearly twice the overall state average — means there’s no time to relax. Rapid growth has been accompanied by increasing demands for services and infrastructure and concerns about future needs.

What’s an “Exurb”?

City planners and demographers have dubbed areas such as Marble Falls as “exurbs.”

Finding Exurbia, a 2006 study by the Brookings Institute, defines exurbs as “communities located on the urban fringe that have at least 20 percent of their workers commuting to jobs in an urbanized area, exhibit low housing density and have relatively high population growth.”

Although no definitive polling numbers are available, a recent county questionnaire indicated that nearly a quarter of Burnet County residents work in Travis or Williamson counties, both heavily urban and part of the Austin-Round Rock MSA.

Fritz Steiner, dean of the University of Texas at Austin’s School of Architecture, says three forces are at work in exurban growth.

“First, more baby boomers are retiring, and they like country living,” Steiner says. “Second, there are a number of people who, because of various technologies, don’t have to be near their work. And finally, people who don’t have a lot of resources can move to an exurban setting because it’s cheaper.”

Urban planners agree that a strong metropolitan core is an important anchor to sustained exurban growth. Burnet County has that in Austin, which came in first in Forbes magazine’s recent ranking of “Best Cities to Find Jobs.”

Burgeoning Burnet

Projections by the Texas Water Development Board indicate Burnet County’s population will nearly triple by 2060, to about 90,000 residents.

And while retirees and vacation-home buyers accounted for most of the county’s real estate sales in the past, young families make up a growing segment, says the owner of a local real estate firm.

“In the last three to five years, there’s been a substantial growth in people who commute, probably to Austin, who are looking for small-town schools, small-town living and a great environment to raise kids,” says Dana Yarter, a real estate broker and owner of RE/MAX of Marble Falls.

But there’s sometimes a gap between expectations and reality, Steiner says. Rural counties rarely offer as many services as metropolitan areas. Texas law doesn’t require counties to offer a fire department or emergency medical services, for instance.

“People move to exurban areas and expect urban services,” he says. “They put political pressure on the county to provide those services, and they cost money that the counties don’t have.”

And much exurban development occurs in a scattershot fashion, making it difficult to plan for and provide necessary services. “Most counties don’t have the power to control zoning, and the growth [often] occurs in the least favorable areas,” says Steiner.

Planning Ahead

Despite their financial and legal limitations, Klaeger and other county officials have made responsiveness and cooperation with other governmental bodies a priority.

Klaeger says Burnet County sponsors about a dozen town hall meetings each year, to get county residents’ feedback on the challenges of growth.

“I think the city, county and school district are well aware of the growth and what to do,” says John Kemper, owner of Marble Falls’ famed Blue Bonnet Cafe. “I know there’s a lot of concern about how to pay for it, but they’re addressing it. There are no heads in the sand around here.”

Transportation and water conservation are Burnet County’s most important priorities for long-range planning, Klaeger says. Its residents recently formed a groundwater district to help manage water supplies.

When Burnet County passes 50,000 in population — as it almost certainly will in the 2010 U.S. Census — it will become eligible to join a regional transportation authority such as the Capital Area Metropolitan Planning Organization (CAMPO), Klaeger says. That would make it easier to join other communities in luring federal funding for projects such as the widening of Highway 281, the county’s main link to Austin and San Antonio.

“Our funding needs are minimal compared to those of a metropolitan area,” Klaeger says. “But if you put together 10 rural communities, our numbers start to be more realistic for funding opportunities.”

Staying Affordable

Affordable housing is a key objective in smart exurban growth. Burnet County’s median home value rose from $85,942 in 2000 to $128,435 in 2008, a 49 percent jump, while the county’s average household income rose from $37,546 to $46,384, an increase of less than 24 percent.

And rising gas prices have been a double-edged sword. They’ve increased the costs of exurb living and put more focus on the need for cost-efficient public transportation — but they’ve also convinced more residents to spend locally, Klaeger says.

Changes in energy supplies and prices inevitably influence how exurbs grow.

“We know that in the long term, prices will go up, and certain countries that are the source of oil aren’t exactly friendly with us,” Steiner says. “The challenge to transportation is to encourage growth where rail connections and other public transportation is available.”

Grown to Last

Roger Galatas, a developer who played an integral part in creating The Woodlands north of Houston in the 1970s, says planners have to strike the correct balance between development and quality of life.

“You need to focus on developing the community instead of the market,” Galatas says. “If you build a community to fit the market, you’ll be successful.”

He emphasizes that the infrastructure, both physical and economic, is important to healthy and sustained growth. Problems begin when the tax base declines and crime rates rise.

“That’s where the whole thing can start to unravel,” Galatas says.

Still, he thinks Texas is ripe for continued exurban growth.

“I think we’ll see the pattern continue,” he says. “Look at the I-35 corridor. That’s where the jobs are moving to, and where the focus will be in the future.” FN