Local cities sit pretty in economic rebound

Staff Report on September 23, 2015

By Cyndy Slovak-Barton

Cities in some parts of the U.S. are still hurting from the recession, but it seems Texas has quite a few of its cities listed among the most recession-recovered cities in the country.

That report comes from the WalletHub Study, which periodically looks at trends around the country.

The timing of the report fits perfectly with Kyle and Buda, as both cities are working on industries and strategies they feel can help their towns.

Kyle is just coming off its Economic Summit, which brought together business owners, developers, residents and city staff to talk about what the city of Kyle needs to maintain its character, yet still grow.

Buda also has made a strong comeback, with good planning being noted as one thing that helped the city.

The WalletHub report shows four Texas cities – Lubbock, Corpus Christi, Houston and El Paso – in the Top 10 of the most recession-recovered cities in the U.S., with Lubbock leading at number one. Austin came in at No. 14.

Other cities in this Top 10 list include Denver, San Francisco, Oklahoma City, Fayetteville, NC, Minneapolis and Anchorage.

According to Diana Blank-Torres, Kyle’s Economic Development Director, Kyle’s location had a lot to do with its recovery from the recent recession.

“Kyle experienced an economic downturn starting in 2008-09, but it was never quite the recession much of the rest of the country went through,” she said. “Central Texas overall was not hit as hard and that was also true for Kyle.”

Buda City Manager Kenneth Williams agrees. “Our corridor did not suffer as deeply nor did it sustain the effects of the recession as long as many parts of the country.”

One reason Blank-Torres feels Kyle and Central Texas experienced a faster upturn was because, despite the recession elsewhere, Kyle still had some activity going. “Because things were still happening here, we got the attention of developers,” she said. “With the city on a fast growth path, much of our efforts were on developing services and amenities, such as retail businesses and restaurants.”

Williams said that having good fun balance policies positioned his city for a strong comeback.

“With Buda having a large part of its revenues based on sales tax, when the recession hit, we were able to sustain and did not have as far to recover as some other cities,” he said.

The city manager also said that Buda has maintained a healthy fund balance – three to three and a half times – the recommended for a city its size.

“These balances were important during the last recession,” Williams said.

He said land planning also helped the city have measured and sustainable smart growth, which “did not over burden the city at that time with infrastructure projects.”

Both Buda and Kyle are looking at growing their job base, trying to diversify their base so that, in the future, they would not be as hard hit if only one portion of the economy declines.

Buda has pushed its boundaries through an aggressive annexation policy, building more revenue base from property tax without overburdening current taxpayers, Williams said.

The push, during Kyle’s summit, was to get businesses in town that hired employees for stable, well-paying jobs.

It is the unemployment rate that is one of the triggers for the listing of “most recession-recovered cities.” Grand Rapids, Mich., for example, experienced the largest decrease – 2% – in its unemployment rate. Fresno, Calif., on the other hand, experienced the largest increase at 5%.

WalletHub compared the 150 most populated U.S. cities to put together its listing. The cities were evaluated in two key areas – “Employment and Earning Opportunities” and “Economic Environment.”

The unemployment rate for Hays County sits at 3.9% as of July 2015, according to the Bureau of Labor sTatistics. That’s a 1.1% drop since the same period last year.

The push is not just to get jobs, but to get better paying jobs for Kyle and Buda residents.

“Our economic development efforts are now focused on attracting primary employment firms, i.e., breadwinner jobs such as Seton Hospital, RSI and MSI Constructors,” Blank-Torres said. “Bringing in manufacturing or high tech businesses would be good examples of the types of market sectors we hope to attract. While we have several large stores with many employees, such as H-E-B or Lowe’s, we also know some of those jobs are part-time. So focusing our efforts on primary employers will help more of our residents find good full-time jobs right here in Kyle.”

Kyle’s Economic Summit also focused on the need to build higher priced homes to satisfy the tastes of some of the newly employed moving in to the area taking on full-time jobs.

Mentioned several times at the various summits was the fact that doctors working at Seton Hays did not feel they could find the homes they wanted within Kyle’s city limits and thus moved to Buda, Wimberley, South Austin or Dripping Springs.

One response to that suggestion came last week as the Kyle city council gave a thumbs up to the request by Cypress Forest to be taken in to Kyle’s city limits. That development, at the corner of FM 150 and Stagecoach Road, is focusing its properties on higher-priced homes on larger lots. The developers, David Weekley and Scott Felder, are setting initial prices for those homes in the $200,000 to $400,000 range. That price of homes is in line with other area subdivisions, such as Mountain City, Ruby Ranch and Elliott Ranch. The groundbreaking ceremony for the development was held last week, the day after the property was approved for annexation.

The long view of cities trying to protect its bases from recession is nothing new, and the location of Buda and Kyle certainly helped in their recovery. But when the next set of economic indicators point to a downturn, both Buda and Kyle are hoping their current preparations will make for another quick recovery.

Top 10 most recession recovered cities in order:

1. Lubbock

2. Denver

3. Corpus Christi

4. Anchorage

5. Houston

6. Oklahoma City

7. Minneapolis

8. San Francisco

9. Fayetteville, NC

10. El Paso

Least recession-recovered cities