Greetings, and welcome back to ZacCast, the official podcast for local government nerdery. I'm Chad. That's Patrick. How you doing, sir?

I'm good, man. How are you?

Good. Hey, before we start, I had read something today that, uh, a couple of weeks ago we talked about, like, these random facts, so I thought you might like this. I think it was, like, Wall Street Journal. I read it this morning. Okay. You have to follow me here because there are some, like, assumptions that you have to make to understand, like, how the math works, okay?

Okay.

So the cir- circumference of the Earth is about twenty-five thousand miles, okay?

Twenty-five thousand miles.

So what we're going-

Hold on. Let me, let me get my paper out, sorry.

Okay.

Twenty-five thousand miles.

So what we're going to assume is that you can actually circumnavigate the globe in a vehicle, okay? So just for the sake of argument, you can drive all the way around the Earth, okay? Now, assuming-

What do we call, what do we call that when all the continents are together?

Pangea. But it didn't cover-

Pangea, yeah

... the whole Earth. It was still just a small portion of it. But anyway.

Okay. All right. Yeah, sorry.

Okay. So you can drive all the way around the Earth. Uh, assume that you're in, like, an F-150, something that gets, like, fifteen, sixteen miles a gallon, okay?

Okay.

Now, um, also assume no inflation over time, and su- assume that you're using an average, uh, cost per gallon of, you know, in America, it's, like, three eighty right now in America.

Mm-hmm.

So as you drive around different regions where gas might be more expensive, just assume it's all gonna be the same price, okay? And over time-

Okay

... it will be the same price, okay? So making those assumptions, driving sixty miles an hour continuously, you could drive for six hundred and ninety years using only the money from Jimbo Fisher's buyout.

That's what you have right there. I ... Look, I am still ... I, I sent this in a text message, and I know you took a screenshot of the text message, but I still believe in Jimbo. So I still believe that we will win. I'm an Aggie, dude, through and through. Like, I'm not-

Good for you.

I was, I was an Astros fan when we were terrible. I, I'm an Astros fan when we're great. Um, that's, that's why this area of Texas is such a great place to be a sports fan. You live and die by who you are. I'm a Rockets fan. I'm a Texans fan, Molly both. I will say, I have become a little bit more in tune with the Cowboys. I'm not saying I'm a Cowboys fan, right? But they are kind of the team that's closest to my house, and my kids like to watch the Cowboys game, and you know, so it's got-

Yeah, it can be hard to watch the Texans up here sometimes.

Yeah. Who'd y'all lose to this week?

Uh, we beat, uh, Detroit, the Mighty Lions, who are now one and five.

Yeah, I wasn't talking about the Cowboys.

We're six-

I was talking about that university that's in Austin.

Oh, okay. So let's get right to it then because we hinted at this, uh, we hinted at this topic la- on the end of the last episode or maybe two episodes ago. I don't remember. Um, but it's an interesting topic of conversation because it kind of, um, it hits at a lot of things that we talk about, specifically, uh, housing and zoning and parking and things like that, but also local control, right? One of the things that we advocate for a lot is local control, and what's going on in California right now, which is a, just a series of, of housing and parking reforms that are at the state level sort of restricting the ability of local governments to, um, you know, regulate how certain types of developments occur. So, um, the specifics of these legislation, uh, and these pieces of legislation isn't really all that important, but just so, you know, everyone's kind of, uh, on the same page, there have been a recently signed laws that, for example, allow you to build duplexes on lots that are zoned for one house or allow you to split your lot into two parcels, right? Basically by right. Um, they make it easier for cities to approve zoning changes for, like, apartment complexes of up to 10 units in neighborhoods where you have single family residential zoning. Um, various things like this, uh, ADU by right, uh, accessory dwelling units by right, things like, things like that. And, and in one case, um, if you have an ADU that's under seven hundred fifty square feet, the city cannot require an impact fee on it, right?

Yeah.

So, um, some of the other things they've done have been to, uh, basically get rid of parking minimums within, like, a half mile of a major public transit stop. Um, that's a little bit different, I think, because, uh, the idea behind those transit stops is obviously providing a viable public transit option, and, uh, there's of- often a lot of state money that comes into that, federal money. And so if, you know, if you're gonna have, uh, this investment from the state, then they're probably gonna want to have a little bit of say in the development that goes around it. So it's, it's a little bit different. But my question to you is because I, I kinda struggle with this topic in particular, uh, in part because the outcomes I'm generally in favor of, um, but we do often talk about local control. And so, um, what I would much prefer is that each city would, on its own, come to these conclusions, right? Uh, I think when you, when you start to do too much from the top down, you can build up resentment, you can build up, uh, antagonism, versus when you're in a situation where you kind of make the case and convince people and have that groundswell, um, then I, I think you're in, at that point, a longer term positive outcome. Um, but it is possible to make these changes at the state level and then eventually have people kinda realize that, yeah, this was probably the best thing. So, and it is possible. We've seen that, I mean, in many, many cases, uh, that are absolutely not relevant to, to this topic. So, um, I thought it might just be a good topic of conversation. What are your thoughts on, on some of these changes and, and how they impact cities' ability to regulate housing and things like that?

Well, let, let's first, uh, focus on the local control piece, 'cause I, I think that's extremely important to, to hit on. And, and let's talk about why the local control piece has failed specifically when it comes to this, right? Um, you can go on the internet and download the game NIMBY. It's quite fun. Uh, it's basically like a Sim City emulator- ... that allows you to build a city that-

I think it's called Sim NIMBY.

S-Sim NIMBY, yeah. Um, that basically will allow you to build a city, but it, it, it really doesn't allow you to do anything because the, uh, the neighbor next door won't allow you to. Um, and, and I think in local control, especially when it revolves around zoning, uh, we have really failed at the local government level. Uh, and we, we talked about this all the way back in grad school. We talked about the public input process that cities had, and, uh, you know, you and I dealt with that for a long time, where you would have maybe one or two or three people come into a city council meeting, and they would share, all share this opinion, and they would be very impassioned about that opinion. And a lot of councils, and even some staffs, uh, to be fair, but a lot of councils and staffs look at that and say, "Well, that must be the opinion of the entire community. These three people must be the opinion of the entire community." Um, and, and clearly by the popularity of what California has done, that's not necessarily the case when you look at it from a statewide standpoint. Um, but that NIMBYism and the ability to, or lack of ability to implement decent zoning laws that allow for, uh, investments to be improved within those neighborhoods, it, it's really caused this friction at the local level where you can't do the things you want to do with your property, almost, almost to the point of, like, violating a property right, not when it negatively impacts somebody else's property. But, uh, because the, the reality is, is, is, is what you're seeing in these California neighborhoods, uh, with these dwelling units, these additional dwelling units that are going in, is, you know, the, the property values of the surrounding community are going up, so they're not actually having a negative impact. But people claim there's a negative impact, and that's not really what the data shows. But because there's three people in that city council room, the city council couldn't adopt those codes by themselves because they had this false narrative of, "It's not good for my local community." I don't like the direct legislative zoning that is done at the state level. Um, you know, I would like there to be a better check and balance, and, and I've really thought about this. So I, I think one of the reasons we listened to this, like, two weeks ago and took some time is 'cause you and I both kinda needed time to really think this through on how we felt. I would've... Like, think of it from, like, my kids at a bowling alley. I would have rather had bumpers. Like, I, I think it would have been better for the state to kinda lay out bumpers, um, and give communities a choice in how to do this, right? I don't think in all communities 750 square foot is a good number for not requiring specific types of approval, right? I think every city should have the option of doing an SUP at a certain level and not doing an SUP at a certain level. Um, you know, whether-

Well, that was just an impact fee.

Yeah, but I mean, y-you get what I'm saying. Like, whether you're gonna develop this thing as, like, an allowed right, or you're gonna develop this through some type of SUP process, or, you know, looking at adjacent, uh, property, looking at the impact of the adjacent property, those type of things. Like, it would have been nice, almost like we have in Texas. So in Texas, you have two different aspects of entitlements. You have zoning, right? And then you have subdivision. And, and we always say that subdivision is a magistrate authority of a city, right? As long as you meet these checklist guidelines that are kinda laid out in state statute, but are also kinda also put into some local language that are more directly related to those cities, right? Drainage may be a little different in North Texas than it is in Houston, for sure, right? So they're gonna have different subdivision requirements when it comes to drainage. I would have liked it to be laid out that way. The general rule of thumb in subdividing property in Texas is, is you have the legal right to subdivide your property. That's the general rule of thumb. The city has the right to kinda put you within guardrails to make sure that you're subdividing it correctly, you're providing proper access, drainage, roads, you know, access for water and sewer, so forth and so on. So I think that would have been a better path for California than almost the direct legislative zoning path that they took.

So I think that's a, a valid point. I'm, I'm hesitant to use the property values, whether they go up or down, as an argument in this case. Um, I think that we do... I mean, one of the biggest arguments against any kind of redevelopment or new development is that it's gonna affect my property values negatively. And I think that conceding the ar- it concedes the argument to say, "Well, actually, it makes them go up." Um, and, and I don't really find that to be the most effective or, uh, cogent argument either for or against additional development or, uh, you know, upzoning or anything like that. Um, I think that the more that we can sort of ti- or untie, untether a home that we bought from being our biggest investment that we have, it's probably better for our local politics, um, in the long run. Because you do have, uh... I mean, talk about the three people that come to a meeting. The reason that they're there is because they vehemently oppose something. The other 50 or 80 or however many people who don't really care that much, they're not gonna invest the time to go to a meeting, right? But when your home is your most valuable and your, uh, your most important financial instrument, it puts a lot of, uh, both emotion and just sort of visceral, uh, opinions on what other people do with their properties. Because if it does negatively impact, you know, your, your property values, well, then how much of your net worth are you losing? How much of... Like, it's basically become like a forced savings mechanismAnd, and now all of a sudden, I was planning on, on retiring here or using this, uh, in some way when I get, you know, to an advanced stage, and this is going to limit my ability to do that. I think if we can untangle homeownership with this is my most important investment that I have in my whole life, then that would help us, uh, alleviate some of the, the tensions that we have in the housing, uh, realm.

Yeah. So I mean, I, I don't, I don't disagree with you on we should disconnect the property values from, from people's, uh, like investment side, right? Like, that's, that's their biggest, uh, you know, it's the biggest generator of American wealth is, is homes. Like, I understand that that's probably not all that healthy when it comes to zoning conversations and, and things like that 'cause it-

Well, it's not healthy when it comes to long-term economic development because if, if the primary way that your home is going to increase in value is by not building any more homes, then what are we supposed to do moving forward, right? 'Cause now all of a sudden we're at a point where we have such a huge backlog of homes-

Right, so we gotta-

... that we need, and so now you're talking about massive, uh, new development.

So we have to dig into that, though. That's correct. But we have to dig into that a little bit, right? 'Cause, uh, also in that same podcast, they talk about the other reasons, you know, that California was, was having this inability to build homes, right? There was a big environmental push, uh, when, when growth happened in the '50s and '60s, and Sierra Club got involved, and so there was a lot of legislation passed that gave local authorities a lot of authority to kinda slop- stop or slow development because they were losing a bunch of redwood forest and, and so forth and so on. But we, we've gotta mention that piece 'cause I think it's hard to do. I, I don't disagree with you that it has now become a vehicle for people to make their properties worth more for the simple fact of a supply and demand issue. If there's nothing else coming on the market, therefore my existing property will be worth more, and it will advance that wealth through this property. And I, I, I agree that that's probably irresponsible from a long-term, um, investment, like, strategy for the city, right? Or for the community, especially when you throw, uh, Prop 13 into it, right? Because you can't... You're not getting any of the increase in the value of that home as a governmental authority, right? Like, that house-

Right. So-

... was bought for $400,000. It's taxed at $400,000 even though it's worth one point six million.

Yeah.

Right?

So Prop 13, the, the, the referendum that created California's property tax system which, which is much, much more restrictive in terms of the value growth than, than we have here in Texas.

Yeah. So and all the Texas city managers are like, "Man, California's crazy." And it is. Like, ev- everything about their property taxation system is, is really goofy. Uh, and it's, it's, like, really anti-free market when you, when you look at it that way too. But I, I, I, I look at what California has done, and you can see the detrimental impacts to that. I don't think it was just one thing though. Like, I don't think it was just the nimbyism that hit it. It was also the environmental movement. It was also the investment and development movement. It was... You know, there are a lot of developers out there that love very restrictive communities because they can work within those restrictive communities. They understand it, and it, it kinda clears the path for a number of larger players that have the ability to go through the complexity. Right?

It makes it much harder for small development.

Makes it much harder for smaller development. So in, in the world of, like, California, you know, you, you have a lot of your density developers and things like that that were doing quite well. And then on the other side of the argument, you have more of your track home developers, like your D.R. Hortons and so forth and so on, that were on the, the other side of this is we've gotta loosen this up because we've gotta make this availability for the workforce and so forth and so on. And I think ultimately what happened at the state level is they started asking themselves the question, and we, uh, some of this comes out in the podcast, uh, not, not really, uh, but a little bit of it. They started asking themselves the question, right, "Why are people leaving California?" And it's a beautiful state. Yes, it's a high taxation state, but it's a very pretty state, right? Why are people leaving? And the main reason is they can't, they can't afford a home. Generationally, they can't get into a house, and so that's why they're leaving the state. They grow up there. They go to school there. A lot of times they go to college there, and then when they graduate college, they figure out, "I'm not gonna own a home for 30 years." Um, and, and so... Or I can just move to Texas, and I can be 26 years old in a job, and I can own a home the minute I get on the ground in Texas, right? Um, so I, I think that's a little difficult. The other side of that is the investment piece. The federal level, I mean, getting past local, state, and everything else, but the federal level has really encouraged people to use their homes as a piggy bank. If you look at every federal policy on home lending, right, it, it's basically like we're gonna grow the middle class through homeownership. I mean, you, you've heard president after president after president say that. Um, and, and they do. They use FHA, and they use the lending programs, and they use the bond buying programs-

And the tax code

... and so forth and so on, and the tax code to encourage homeownership. Um, and so, you know, I think we're gonna continue to see that as a wealth generator, not because that's what people want it to be. We're gonna continue to see that because the government has pushed us into that policy decision.

Yeah. So this is the one area where I, uh, am a little bit more confident in my opinion on this, and that's that when you, when you s- do start getting into, um, mandated behaviors, right, whether it's with the, in the federal tax code or whether it's the State of California saying that you can and can't do... You have to allow this. You can't allow that. One of the areas that frustrates me the most about some of these laws is that they have-Certain carve-outs or certain requirements for, uh, whether it's prevailing wages or s- different kind of benefits or, or, you know, union carve-outs for some of these things, which really kind of negates the ability to actually implement some of these in some ways, right? 'Cause, like, if you're trying to... Or, or at the very least, it makes it more difficult for smaller developers to be involved.

Mm-hmm.

And so when... Then you start talking about the big players again, and, and then everything becomes a really big development. And what we really need is for a bunch of small developments. We need a bunch of, uh, of, of small iterative changes over time. And so I think a, a framework that's crafted more towards that would, would be better long term as well.

It's a little off topic, but I'm just gonna give an example, like a quick example of how those carve-outs have a very legitimate policy, um, decision that's made and, and kind of changes the behavior of Americans. So the infrastructure act that just passed that included all of the EV tax credit information that went in there, right? So vehicle tax credit. Read a really good article on this last week. But, um, so that tax credit requires that a certain percentage of those EV vehicles be built in the United States, and that's a $7,500 tax credit. It's real easy to do now. It's a lot easier than it is to get that done than it is the old tax credit. Um, they, they did that, but they did that for personal sales. On the business sales side, there is a light duty tax credit of 7,500 that does not have the same rules, and then there is a heavy duty tax credit of up to $40,000 that also does not have the same rules or guidelines. So they're encouraging businesses to buy vehicles, right?

In bulk.

That don't meet these... Yeah, in bulk, that don't meet these same American build guidelines, and then consumers on the other end are, are done. So what is that... What is that gonna do from a consumer standpoint? Well, I can tell you right now, for me, a guy who owns a couple companies with you, if I'm gonna go buy a car and it's an EV and it doesn't meet the standard-

My company's gonna buy it

... my company's gonna buy the car.

Yeah.

Right? I mean, it's... And, and the article actually says this, right? It lays it out there that every small business in the world is gonna buy this car through their company tax write-off in- instead of, you know, through the personal side. So i- it's just an unintended consequences of the policy because they, they wrote specific... At a high level of government, they wrote a very specific policy guideline instead of providing guardrails on this is what we... This is the policy accomplishment that we want to happen, now you go do it at a local level and implement.

Yeah.

Which-

I think wh- when you're talking about anything, uh, of this nature, I think the most important thing that policymakers can keep in mind, this applies to local governments too, when you're trying to write rules for complex systems, you need to write simple rules, right?

Mm-hmm.

You can't account for all of the edge cases. You can't try to, uh, manipulate things into being. You just need to write simple guardrail rules and then let the system kind of evolve over time.

You have to find the why. Like, I, I, I say this, e- everything we do, right, everything that I... I mean, even when I'm coaching youth sports, if you tell a kid, "Go do this," and they don't understand the why of, of why they're doing that, then they're not gonna do it as successfully as they did it if it's the why. So when you're dealing with something that's super complicated from a policy perspective, if you'll just say, "This is why we wanna do this. This is what we want to accomplish," right, then you know exactly what those, you know, details and edge cases and things like that, like, where they should be tilted to, right? But instead, we try to, you know, go and, and build these really complex systems with crazy strict guidelines that make it almost, you know, entirely too difficult to develop, i.e., the Ca- the California development system when it comes to residential development.

Yeah.

I mean-

And often it makes the opposite of what you want to happen occur. Um, but-

Yeah. We wanna save the environment, so we're gonna-

So we're going to build sprawl

... put all these rules in place, and we're gonna sprawl. Like, how does that, how does that make any se... It's just, it's-

Yeah. We're gonna take all this farmland, and we're gonna build single family homes on it instead of-

And, and to be-

... allowing a little bit more density

... and to be fair, all the Sierra Club wanted, right, is they wanted to make sure that land was not, uh, negatively impacted, destroyed, or contaminated. That was what they wanted to do. The law that they got passed, I think it was in like the late '60s, early '70s, but the law they got passed in California basically made it so hard to get an environmental document through the process that it took two and a half years to get an environmental document done. Whereas in Texas, you can buy property, plat it, subdivide it, build a road, put a subdivision in, get all that done in a year. So of course housing's gonna be cheaper here because you can handle demand better. You can turn that pipeline on, turn that pipeline off very quickly, and in California you can't. So, um, you know, maybe these new guidelines work. They're... It's, it's important to say that this is very focused on... They're kinda test, uh, ballooning here, right, with this additional dwelling unit. Um, and we'll see kinda how that goes. But what's, what's happening is, is that the development community's going in there, buying these single family households, subdividing the single family household under this ADU statute, and then also adding another, uh, ADU unit on the property. So they're taking a single family household, and they're turning it into a three-family household, right? Um, and so that... It's very interesting how this is, is, is going through the process, and we'll see where it is. The, the reaction within the community is, is mixed. But yeah, we'll see where that goes.

Yeah.

All right, next topic.

Okay. Real quick, just to wrap up.On this one, of-- 'cause it's, and kind of, we'll kinda go into the next one as a result. But for me, when I'm trying to figure out, uh, this is kinda where I am in terms of my opinion on this, I, I would rather it be a local initiative. Um, but when you're talking about the legal framework that cities operate in and where does local control, um, come into that, I'm trying to think of this in, um, like some kind of statutory change that limits a city's ability to actually operate and function versus one that sort of limits their scope of authority. And I don't know if that's really a reasonable, uh, like barrier to draw from a local control standpoint, but I look at like property tax reform as a, a mechanism that is impacting cities and local government's ability to just function at all versus, say, the, um, the recent annexation laws from a couple sessions ago. Sort of limit the scope of, uh, what cities are able to do. Now I know a lot of cities especially didn't like those, those new annexation rules.

Mm-hmm.

But even just tying it back to these, these California housing rules, it's not so much that they're, um, limiting the city's ability to function. They're just saying, "You actually can't really regulate this part anymore, um, because zoning is essentially offered to you as a, something that you can do by the state. So you can do all of these things, but you can no longer do this one thing." And that's kinda where I'm struggling a little bit on, on how I feel about, uh, about it. I don't know if that's a good heuristic to use or if it's consistent, um, at all, but that's kinda where I am.

It's a very complicated, it's a very complicated topic, and it's, it, it, it really, it has so many different details that could work in different manners and forms. So, um, I would love to actually, and we should in a future topic, now that we've had that annexation reform bill, I would love to get a couple city managers on to specifically talk about what impact has it had on our communities. Because I, I mean, I can tell you just real quick, the impact has been for folks that, that we've come across, cities have changed their mindset, right? They're not building water pipelines to eventually go two miles outside their city anymore, right? That's, that's been one of the big changes. So water capacity may not be as available in the ETJ. Um, and the state's trying to adjust to that now, right? The state's trying to go in there and be like, "Well, if it's in your CCN, you have a legal obligat-" There's just a, there's a lot of push/pull there, right? Um, but at the same time, cities still have a level of control on what happens in the ETJ because they need utilities and they need some other things. So there's been a better, um, communication between developer and city because cities have to work with them and developers have to work with cities. So it's, it's kinda brought both parties to the table. Um, I'd be interested to kinda get, uh, two different aspects of that conversation-

Yeah

... on. So, um, and, and hear that out.

Put a pin in that one.

Yeah. Put a pin in that one. We'll move on to the next item.

If you have a, an opinion on that topic, please reach out to us and we might have you on the show.

Yeah, awesome.

Okay, so the next topic, somewhat related to this concept of local control, of subsidiarity, of where decisions are made. Um, a few weeks ago on the Strong Towns podcast, uh, the Strong Towns founder, Chuck Marohn, talked about a very specific situation that he ran into in his hometown of Brainerd, Minnesota. One of his neighbors, they are not on the friendliest of terms, I guess you might say. Uh, it's not that they necessarily, uh, dislike each other. It's just there's a little bit of antagonism. Well, at some point, the neighbor f- uh, applies for a fence permit, is gonna either replace or put up a new fence or something in b- in between their lot lines. One day he's just out there building, building a fence on what Chuck Marohn believes to be his property line. And so what turns out to have happened is that when the neighbor went to go get his fence permit, the staff in the, the permitting office pulled up their little Google Maps with their parcel lines and they said, "Okay, here's where your property line is. You can build that fence right there." And so that's what the neighbor did. Whereas typically, these things are done, uh, by saying, "Okay, well, you and your neighbor agree on where the property line is." Right?

Mm-hmm.

And just y'all work out what that question is, and, uh, and then you can go from there. Um, and the point of this story, uh, was that he felt like the city was approaching this A, from a slight bit of incompetence, but B, from a, like a retail customer service mindset where, you know, the customer's right, we're gonna go out of our way to help you and get you the answer that you need and that means that we're gonna pull this map up and tell you to, to go do it, as opposed to, uh, seeing their role as sort of almost, almost like a mediator in that circumstance, right? Like, they're not gonna be the ones to make this decision. What decision actually needs to happen, uh, or where it needs to be made is with the neighbors and, like, in that particular very local setting. Um, and so he, he kinda raised that as a topic of, of customer service and how does, how should cities view customer service? Is the retail customer service mindset, um, the right one? Or should we be more looking to, to push certain decisions down as low as they can go? Um, so anyway, I know that you had some concern. We talked a little bit about it, uh, on the-

Mm-hmm

... previous podcast, but why don't you go ahead and, and throw out your opinions to get us started.

I, I think it's important to understand that Ch-Chuck explains one instance where, um, his neighbor at, like, 2:00 in the morning starts a fire in their backyard. Like, they start a bonfire in their backyard and it... You know, this, this is, uh, Minnesota, right?

Yeah.

And, and so it's, you know, it's a summer evening in Minnesota. There's no air conditioning in a lot of these areas, and so people leave their windows open. Like, that's how they get cool air in the house. Um, and he explains that they start the fire and it's right outside of his master bedroom window.And that it just starts billowing smoke into his house, right? I just tell you, in Texas, I don't think that would have been near as friendly as it was in Minnesota.

Minnesota nice.

Yeah, Minnesota nice for sure. And so, you know, he kind of talks about like they really hadn't met the neighbors yet. So they tried to meet them and it just, you know, things didn't go well. I think for me, the failure in this entire process of what happened and, you know, it was all over the fence, right, where the fence was going to be placed, what the permit was from the staff. The staff actually showed the homeowner where the fence was supposed to go. That fence happened to be three to four feet on the Chuck's property. And I think what this ultimately shows and where I really agree with Chuck in his conversation is the city staff actually got in the way of neighbors talking to neighbors. And I think the city staff should be more like facilitators. And Chuck makes the comment that we should have less engineers, right? And I can't remember if he gave another occupation, but I do remember him talking about engineers. But we should have less engineers and more social workers in city government. I would actually say we just need more logical, business-friendly, like-minded people. See, and he talks about, well, the customer always being right and the retail aspect of city government is where that failure came in. And I would say I don't really think it's that. I think it's that you've hired people who are very right-angled, very black and white, and then asked those individuals to also not make somebody mad. So in order to make somebody not mad, they make compromises in process that they don't see as a problem. And that compromise in process is what got in trouble in this instance. And I think what we need to do is we need to have city staff members at a local level. When the local level needs to get involved is when it has an impact on two or more properties. And when it has an impact on two or more properties, we should work towards a resolution that is fair for all property owners. Not a resolution that everybody agrees on. I think that's extremely important. But a resolution that everybody is there. So, for example, we always, in the previous city that we worked in, it was very common to build what we called mother-in-law quarters. And there was a specific use-

An ADU, as it were.

An ADU, yes. And we had a specific use permit process to go through that. And we would stipulate in that permit process that you would not get staff recommendation for approval if you did not have a conversation with your neighbors and get a letter from those neighbors stating that they were okay with what you were doing. Not a verbal, not a my neighbors are just in favor of it or a phone call. We wanted something in writing. Like you could put together a petition with the attached drawings, however you wanted to do that. But we wanted that to come in so that we could see that you had taken the time to go knock on the door and talk to your neighbors, to let them know what was going to happen. And we also said, but hey, if you have a neighbor who doesn't agree with this, right, then we will reach out to that neighbor and figure out why they don't agree to it so that we can try to come to some solution. Instead of neighbor going after neighbor about that, I would pick up the phone normally in this case and I would call that other neighbor and I'd say, hey, you know, they want to build this. What's your problems? Blah, blah, blah, blah, blah. And I would also be the carrot and the stick. Okay, I understand that concern. I think we can work with the resident to try to get something there. I was a mediator in the middle of the process. I was not a dictator. I was the mediator. Well, you understand they do have the legal right to build this. I mean, ultimately, this is something that we allow all the time. I actually used to use the line, I think we had three city council members that had these already. So you're asking a city council to deny something they already have, right? But I would stipulate that we want to work with you and we want to do this, but there is a line of what you're going to get. Like, don't ask for things that are just outrageous here. And they have the right to do this. I think Chuck's, where Chuck is really has a great point is that the city staff didn't do that. They didn't try to take it to the neighbor to neighbor level to go get something done. Where I disagree with Chuck is, is Chuck feels like that neighbor should come over, should get an agreement. And if that neighbor doesn't agree, they should have to go spend thousands and thousands of dollars on survey. Like the person who wants to put the fence up should go spend thousands of dollars on a survey to get that done. I think a city should step in before that happens. I think a city should step in and say, okay, is there a reasonable need to do that? Are we arguing over six inches, two feet? What are we actually arguing over? And is there something that we can do to help with that? Because you guys are both taxpaying citizens to assist with that process. That's where I get more retail than Chuck is, right? Where he's like, no, it needs to go to the homeowner and the homeowner's got to do that. I actually think the city should have some retail involvement in that process.

That's fundamentally a different skill for a planner than what we typically, right? So I think that's where he gets into like hiring social workers essentially, is that it is a much different skill set than someone whose primary nine to five is looking at plans and saying, well, here's seven different parts of the subdivision ordinance, the zoning code that this doesn't agree with. And so go fix that, right? Like just sort of by the book kind of job versus trying to find some way to get middle ground. And really going back to what you said earlier, understanding the why, like why do we do this, right? Why does staffNot recommend something without all of the neighbors, not... W- why does staff not recommend this ADU unless all the neighbors have signed off on it? Because there's a process that needs to take place to make sure that everyone can live with what's about to, to be built, right?

Right.

Doesn't mean that he can't do it, or she, or whoever. Doesn't mean the property owner can't build this, but we need to try to resolve some of these things before it gets too far down the road and then have much bigger issues to deal with in the future.

And not only that, resolve it before neighbors are going after neighbors in front of board meetings. Like, th- these things blow up out of control-

Mm-hmm

... over like a garage that gets put in, right? I mean, it, it, it can get ugly.

You start getting code enforcement calls about high grass and things like that.

Yeah. I mean, it, it... at the end of the day, if the city doesn't put the extra into it, it's gonna cost them more in the long run, right? So we, we can do more there. I used to always love, um... So in, in most city zoning codes, there are landscape requirements. So there's a requirement that you put in, and I know we... you and I both don't love parking requirements, uh, but most cities have a parking requirement, right? You have to have so many parking stalls per thousand foot of retail or whatever that may be. And in most cities, they have a landscape ordinance, and it was always intriguing to me how they interpreted the landscaping of a parking lot, right? So in, in the two different ways that were done, the first way is you have to have 200 parking spaces, right? And in most cities, you have to landscape 10% of your parking lot. Well, does that mean you have to have 10% landscaping plus the 200 spaces, right? Or does that mean your square is the 200 spaces and you take away 20 spaces for the landscaping? The interpretation of that ordinance and how it was interpreted by staff members along my path in city management was always a telltale sign for how they would react in the situation in Chuck's world on that fence situation, right? Because the person who interprets that as there are 200 spaces and you need 10% landscaping is not looking at the overall why of that policy, right? The why of that policy is just to break up the parking lot. Are those 20 spaces or the reduction of those 20 spaces going to have any negative impact on the retail? No. Right? They'll actually have a positive impact on the city's ability to generate revenue because they'll increase the leaseable amount of space on the building because-

Well, not if you're just replacing it with landscaping.

Well, no, because you can get more parking in with the landscaping expansion, plus you get more retail. So in the long run, you can actually, if you interpret that one way, you can actually put more square footage in retail, which, yes, does increase your parking requirements, but you're also reducing that parking requirement by the 10% of landscape. So there's a lot of different ways to interpret that, but the way that, that... if it's really interpreted as a right angle of it's 200 plus the 10, then I always looked at that and said, "Well, you're not really thinking through the, the, the, the squishy feely part of the policy, why we're doing what we're doing." And it, it's always written, in every city it's written in a, in a form that's not real clear on which way it's supposed to be interpreted, and every city interprets it different. So every time you got a call from a landscape architect, right, they always ask that question: "Do you interpret it this way or do you interpret it this way?" It was always fascinating to me. How do you interpret it?

Um, I mean, I, I guess it would depend on how it's actually written. My guess is that most of them are written where the default interpretation would be, you know, 200 spaces is requi- are required, and 10% of your parking must be landscaped. So if that means that you need an extra, say, you know, 5,000 square feet for your parking lot or whatever the case may be, then that's what it means. And so then you would have-

Yeah

... less space for, uh, anything else, whether it's building or any other surface use. My, my-

Which is why the cities, the cities that I had influence in, that I was in when it came to zoning, it's, it's why their ordinances now say that that 10% of landscape can be used back towards a credit of the parking lot, 'cause I didn't want that interpretation ever to increase the size of the parking lot. I wanted to decrease the size and just break up the heat island effect. That's what we ultimately were after.

Some nice beautiful trees. That way, when you're walking, you know, like six miles from the one side of the parking lot to the store, you'll have like-

Mm-hmm

... just small little pockets of shade that can, can shield you from the, uh, cancerous rays of our sun.

I mean, right before you're about, right before you're about to pass the 38-foot wide stroad before you walk into a grocery store-

Absolutely

... you can sit under your shade tree.

You know, I've always thought that, that parking at, especially at big box, uh, retail or power centers, I think it's due for like a redesign or like a, like rethinking-

Oh, yeah

... of how it works. Having the drive strip right by the front of the store seems like probably the worst option that we could choose.

I would, uh, I would 100% agree. Um, I mean, you, you got back from Europe not too long ago, and I, I gotta give s- Europe some credit here. Where there are some car-centric developments, right, I feel like Europe does parking much better than we do, right? Uh, and in a significantly safer manner than we do in a lot of areas. But no, I agree. Like, why does that main thoroughfare have to be directly in front of the store? The answer to the question is fire code, by the way. That's why.

Yeah. They have to be able to get up there to the front entrance. They also have to be able to park so they can go inside and get their Cheez-Its and their, uh, Pop-Tarts.

We're gonna, we're gonna have to, we're gonna have to cut that from... We have firefighters that listen to our podcast. They're gonna be very offended by that chat.

That's okay. There's a thing called Instacart. You don't have to drive your million and-

Yeah

... a half dollar fire truck to the gas- the grocery store.

They run about $1.8 million these days, but yes, I feel your pain. We ran that fun analysis one time on how often the fire truck left the, the firehouse and how much it cost to go grocery shopping.

Yeah, every time I see it, I take a picture of it and send it to you and Doug

Yeah. So- But they have, they have, you know, they got A shift, B shift. You know, they're working forty-eight ninety-sixes in a lot of departments now, so they have to go shopping less.

Yeah. Forty-eight on?

So, you know, they used to work forty-eight on, so instead of twenty-four, right?

Interesting.

They go forty-eight on, ninety-six off. So a lot of your smaller departments have gone to that.

So they can buy food for two days. Interesting.

So they can buy f- food for two days, which reduces the overall amount of trips to the grocery store and cuts it in half.

Uh.

'Cause it would take basically-

I guess you could also just-

... seven of them or you s-

... buy food for more than one day. You could buy... Well, why can't you just buy food to have food in the firehouse?

I, I get it, but most fire shifts are from like 6:00 to 6:00 or 7:00 to 7:00, right? So you would almost always see a firetruck in a grocery store or Walmart parking lot at like 7:15 or 7:30 in the morning.

Mm-hmm.

Right? Because the shift just started, so-

Get to work, go to, go to Walmart

... they're, they're gonna go get their food for the next 24 hours for the shift, and everybody throws money in and splits that pot on the food and the meals, so-

It's just a, it's just a super efficient use

... it could just be like the Google of fire departments.

Yeah, it's a very efficient use of-

You could just be like the Google of fire departments though and have like Aramark come in and feed all your firefighters on shift, make that a, a perk of the job.

Like a, like a chef that just goes by all your stations. They'd have to eat at different times though.

Yeah. But you know, like one of the big things I did in, on the management side, I hated employees paying for drinks. Like, I thought that was the craziest thing in the world. And so, you know, I always had, you know, the Keurig machine, and I always had, you know, drinks, Topo Chicos and Cokes and sodas and waters and-

No, we never bought Topo Chicos, but we always had Coke and sodas.

Yeah. So we did towards the end. You may not have been there then.

I bought them.

But we did buy... You bought them personally and then brought them in?

I bought them for myself, yeah.

Okay. So we had a very millennial workforce there. A lot of Topo Chico drinkers. Anyways, so are, are, are we lost on this Chuck, uh, Chuck topic, or will we wrap that one up?

I think we're good.

Okay.

It's a, it's a complicated subject just like the others. I think that, uh, we do need to have sensibility for why certain decisions are made. I don't, I don't think that the retail customer service approach of trying to be helpful and going the extra mile is necessarily a bad thing. I think you have to, you have to pair it with an understanding of why you're doing what you're doing. Um, I mean, I, I would... If I had two options, and maybe it's just an, uh, a matter of disagreeing with his definition of what retail customer service would look like, but I, I would rather have an employee who does try to help, right? Like, whose default position isn't no on everything, but like, "I'm gonna not just give you a terse answer, but either try to explain it or, uh, go out of my way to try to help resolve whatever problem you're having."

Mm-hmm.

I would take that over the opposite, but you can get into trouble if they don't understand why they're doing what they're doing.

Yeah.

Because then they can go too far a- and get the city in trouble, like that particular instance that he, that he mentioned, so. Like everything, it's a balancing act.

So, and, and, and the, you know, and what he mentioned is, it should have never happened, right? Like, they, they use a mapping software system, like a GIS mapping software system to determine where the fence line should have been, and it literally gives you a disclaimer when you open up your GIS software on any city website.

Don't use this.

Don't use, don't use this for this purpose.

This is for reference only.

Right? It's for reference only. So, um, I mean, they, they did everything wrong, and Chuck kind of wraps up with that, you know, the city knows they did it wrong. He really feels bad for his neighbor because his neighbor's now having to remove this investment that he put in and move it over, and it's just, it's made matters worse, and I, I get all of that. I wanna jump back to the California topic real quick because I think one of the things we skimmed over and we missed in that, when we talk about where things should be done legislatively.

Okay.

What is surprising in California is, is that this new housing policy is, is coming from like a, I say a little bit more like of a, of a free market approach, but it's coming from the left, right? California's Democratically controlled through and through, right? These are Democratic lawmakers pushing for this legislation to make it easier to live in California. Like, that's, that's their overall goal is to try to find a place for people to, multiple family generations to live together, so forth and so on. That's what they're, they're going after. I would find that to be something typically you would see more conservative states doing, basically telling their cities that they can't get in the way of the free market. Um, and I think it's an important conversation to have in Texas because I do think there was legislation passed in Texas that's like a warning shot to cities, and, and that legislation specifically is the building materials legislation that was passed two sessions ago, where cities were basically told they can no longer regulate building materials to be used in, in construction, uh, as long as that building material is approved within the code that the city has adopted, right? So, um, specifically, if, you know, stucco is an approved substance, they c- they can use stucco. If they can use siding, they can, you know, whatever it may be, Hardie, so forth and so on. I bring that up because if you talk to state legislators about that, I don't agree with this, I wanna be very clear, but if you talk to them, they'll say, "Well, cities were just getting ridiculous, and they were specifi- specifying that, you know, plumbers had to use this specific plumbing valve and this specific shower head," um, and it ended up being like some brother-

I'm sure that was happening

... or uncle who owned, you know, stuff like that. And then like on the brick side, they had to use a specific Old Town Acme brick, blah, blah, blah, blah, blah, blah, blah. And I'm like, "Okay, but was that across the entire city, or was that like in a downtown, Old Town downtown area where they wanted to match the brick?" Or in like the beautiful city of, of Granbury where everything has Granbury white stone. Like, it, it is their signature stone.I say all of that and tell people that I don't necessarily agree with it to say, if we don't get a handle on our zoning side, on just the hysteria and, and everything else that comes out of the zoning processes and local governments, it's gonna be a lot easier to pass that in Texas than it would be to pass it in California.

No. You know what's gonna happen in Texas? Some cities are gonna start upzoning their single family residential, and you're going to get a, a state law that says you cannot do that.

Oh, you think it's the opposite?

Yes.

Okay. Wow.

Yeah. That's what I think will happen.

So you think, like, Austin... I mean, 'cause that, that would be s- Like, Austin has a-

Mm-hmm

... you know, huge housing shortage, right? You think, like, Austin goes to their, to single family residential neighborhoods and says, "Okay, you can now make these multi-family."

You can now, by right, make them duplexes. Something like that.

Yeah. Okay.

Um, I don't know if Austin would be the test case that would, uh, like, the shot over the bow that would cause the reaction.

Uh-huh.

It's possible, just because everything is so antagonistic with Austin anyway. But, um, but yeah, that's, that's my guess. And it's not so much because it, it wouldn't be something that you would expect a conservative Republican party to do, right? Free markets. Um, but, but things in local government don't tie to those labels, right? So what we would end up having-

Sure

... is more of a culture war reaction, uh, versus any kind of free market, limited government conversation. It would be, "Well, those-

So could we get a-

... those Democratic mayors are doing this, and we're gonna stop them. Like, you're not gonna end our single family residential homes, um, and so we're gonna prevent you from, from upzoning."

Not, not that, uh, not that this information, not that this topic wouldn't make really interesting bedfellows. Isn't there a really easy way for cities to get ahead of that conversation? Like, we all know this is where things are gonna go, right?

What, just do it now? Just immediately upzone everything.

No, not, not necessarily do it, not necessarily do it now, but is there not, like, an area where, like, APA Texas and TCMA and GFOAT could put together some committees where they have a bunch of people on it, and then also bring in, like, the development associations and the builders associations and have those conversations and, and really have that be, like, a more of, like, a commission push from everybody? Like, both sides of the equation at the table. Like-

I mean, it's, it's-

... let's, let's get ahead of this to legislate it instead of get, getting a reactionary legislative-

Mm-hmm

... process.

It's theoretically possible, but it seems like the legislative leaders tend not to have any interest in what cities would have to tell them.

But we're seeing it. I, I think we're-

Now, maybe if you get-

Yeah

... other parties involved, that would help. But...

But we're see- we're seeing it now in Texas that the, you know, the for-rent communities that are being built, like, the single family for-rent communities that are being built, we're seeing in older areas a real push/pull on additional dwelling units on the properties. You, you see it in, in some larger cities as well. It just seems like... I mean, I, I would make the prediction, I, I'm not sure what your prediction would be, but I would make the prediction that Texas is not gonna be far behind California in the need for housing. Like, we're-

I think we're already there. We're not as bad.

We-

But we definitely need more housing.

We're not as bad, but we already see the fact that we're gonna need these additional upzoning measures in Texas, and you could-

Not necessarily, man. If you have, if you have enough land, I mean, think about how much land there is within the triangle. Dallas, Fort Worth, Houston, Austin.

But if you're using our decision, if you're using our decision engine, you're not, you're not, you're not developing that land, right?

You're not doing this right. But-

Correct

... when that's the default position and there's so much vacant land that is reasonably inexpensive, you're gonna keep getting the same type of development, and they're gonna be large developments as opposed to s- you know, iterative, uh, incremental increases in, in the amount of people we can house. But no, I mean, I, I just don't see... I don't see a massive shift in the next 10, 15 years that's anyth- anything online with what California's doing right now.

Okay. Interesting.

I mean, look, look at the housing prices in California. It's ridiculous.

Oh, it's crazy. It's crazy.

800 square foot houses for $2 million. There, there's no place in Texas. There are places in Texas that are approaching that, um, but not, not on scale.

Not in an 800 square foot house.

Yeah.

Yeah. And, and not in an 800 square foot house. That's... Bungalows selling for that.

Yeah.

You know, bungalows that were basically, like, Sears kit homes.

Right.

I mean, think about that.

Right.

These people ordered these homes-

From the '50s

... in Sears catalogs in the '50s.

Built them themselves.

Built them, yeah, built them theirselves or had subs that would do parts of it, but basically built these houses themselves. And then bam, they're sitting on $2 million now. It's, it's-

Yeah

... it's madness, for sure. Um, but okay. I, I think, I think your point out of all of that last five minutes of conversation, I really agree with you. It was a, it was a really well-made point that Texas is not gonna go the same way as California. They'll go the opposite direction. But that's not conservatism. That's populism.

Of course it's... But think about all the things that we have here. W- it's not, it's not conservatism.

Yeah. Wow. My mind is blown. Wow. But I think there are ways to get ahead of that. I really do. The problem we have in local government is we just go do, and then we hope they don't find out. Like, "Mom and Dad, please don't find out."

Well, that's the whole point of the home rule, right? Is you can do what you want until they say you can't.

Correct.

So-

But, uh, but we take it to the p- we take it to the, like, the, the infinite level of can't, right?

Yeah.

Like, the stove is hot, and we put our hand on it.

It would be nice if we had a better relationship with the state. Um, I think the biggest problem with the state right now is that because of the demographic shifting, the impact of rural voters and interests is shrinking.And in order to maintain current power dynamics, districts are being redrawn such that those rural interests can still have a seat, a seat at the table. If you look at, uh, well, I won't get into that, but the problem is if that we don't come to some kind of like compromise or middle ground or at least understanding, then I, I don't think it's gonna be a, a pleasant time. I think it's gonna be really, really frustrating for a while.

Well, if you look at the polling for the last week, it ain't, it ain't gonna be in this midterm election.

Yeah.

I can tell you that.

It won't be next month.

Yeah. So, and, and like I'm, I'm not saying that, uh, it's gonna always be that way, but when you turn on MSNBC and they tell you that the Democrats are losing by 10 points, they must really be losing by 10 points, right? Like, the polling numbers out there, the approval rating for the president are bad. It's just a weird political time. The, the president's approval ratings are really dismal, um, but also like the a- the approval rating of Donald Trump is really bad, right? Like it's, it's not like he-

His approval rating was never much over 40, was it?

But it's below 40 now. It's like 36 or 37, and, and, and Biden I think is like 38. President Biden's 38.

Well, that's shaping up for a fantastic presidential election then.

Yeah, I mean, it's, it's gonna be, um-

Here's, here's two old guys that no one likes. Vote for one of them.

Correct. It's, it's g- it's gonna be, it's gonna be wild and, you know, as... When we talk about city stuff, we really look at it from more of like an apolitical standpoint. We look at it from local control. That's like the first lens that we look at. Um, and so, but it, it just has the making of ... When cities, what was that, 2008, 2009 when we went through like the Tea Party movement and there was just a really-

Yeah, 2010

... big, there was like a really big shift and change in the political environment at the local level. It just feels like something's bubbling there. It feels like it's ripe for, you know, some of these candidates to find these single issues and, um, you know, I feel like they're really pushing that in the school district side, like books in libraries and, and, you know, things like that. Like, you can ... That, that school, like the, the attack on books in libraries and school boards and so forth and so on feels very reminiscent to the Tea Party movement that we saw in city government. You and I were both in high-level positions in cities when that happened and, um, you know, saw some really good council members who got tossed. Um-

Yep

... and so, um, it just, it feels like something's simmering there because there's just, the dislike numbers are so high. So it's like when somebody feels like they find that topic, that flag to put in the ground, everybody's gonna go around that flag. It, it ... I don't know, my, my two cents. And oh, by the way, the economy's not all that great.

Yeah. So that might be the next thing we talk about, uh, because lots of articles recently talking about how cities are prepping for a recession, which I mean, makes sense 'cause I think if unemployment-

Mm-hmm

... weren't at 3.5%, we would all generally agree after having two s- consecutive-

Yeah

... quarters of GDP decline that we're in a recession. Um-

And we'll post those, we'll post these articles in the show notes. There's a CityLab article. I think there's one other one that we tried to add as well.

There's one at Fortune too.

Yeah.

But yeah, it's, it seems, it seems like that's pretty much the bulwark that's keeping the general consensus from agreeing that we're, we're in recession, but certainly people are expecting us over the next, what, 8 to 12 months to officially be in a recession, that the Bureau of Economic Research actually, uh, admits to. So, uh, lots of articles about cities that are prepping. Now, let's not get into it now because we've already gone long.

No, I, I-

Let's, let's plan it for-

How long, how long are we in right now?

It's gotta be over an hour, depending on how much I cut.

Can we just talk about this now and then cut it into a future podcast?

Yeah. Yeah, we'll-

Okay

... we'll, we'll just run long. It's all good.

Okay. So a, a, a couple of things on the economic topic. There are those couple articles, the Fortune, the, the CityLab article that will be in the show notes, um, that are talking about cities that are preparing for downturn. Um, and, a- and I, I, you know, I do generally, I, I posted on my LinkedIn a little bit about shipping volumes and things like that that we're following. This was about 30 days ago, and basically posted on my LinkedIn. Uh, and you're more of a Twitter guy, I'm more of a LinkedIn guy when it comes to talking about city stuff. But, um, that I, I believe that sales tax will start reflecting a downturn in about 60 to 90 days, right? 'Cause, you know, basically like trash tonnage and shipping volumes were there. I don't know if it's gonna, I don't know if it's gonna dip below inflation, which would be-

Yeah

... negative, right? Quote, unquote, "negative."

Negative real, yeah.

Yeah, negative real. So, uh, but I, I do think it's gonna flatten out significantly. So a lot of cities that are seeing 14% increases, 15% increases, I think it's gonna come a lot closer to the 8 or 9% of inflationary cost. Um, and, and I, the reason I'm saying that, the reason I'm making that prediction, it's not because I licked my finger and stuck it in the air, it's because as these public companies have started releasing data, specifically the UPS's, the FedEx's, uh, the shipping companies, Amazon, uh, those folks that are on the public market, if, if you look at, at their, um, their earnings statements and their releases, they're talking about a slowdown in consumer, uh, spending, and then specifically talking about a slowdown in the amount of parcels that they're delivering, right? So if there are less parcels, logically you would think there are less, there's less revenue, right, from a sales tax perspective for cities. That's my general thought. I've had a few conversations with trash companies who've told me that they feel like their tonnage is down, the overall tonnage of trash is down. Uh, thank you Robert Hannah, Abilene, Texas, uh, for teaching me about trash tonnage and a way to predict there. That was always your idea, so I give you credit for it. But the reality is I think in 60 to 90 days we're gonna see some flattening out of sales taxes, and if cities were projecting large increases this year, they're gonna be, you know, they're gonna be in a, in a, a wild spot. What surprised me about these articles is-These cities are projecting that they're gonna have significant financial downturns in spending, as if we're gonna hit a hard recession.

Mm-hmm.

Right? And in Texas, I don't see, I don't really see a hard recession ahead. I mean, I know that's a blanket statement, but it just doesn't seem like-

Well-

... consumer demand is gonna slow down that much, 'cause there's so much, there's so many people coming to this state.

Yeah. I also suspect that outside of a handful of small cities who, like, know of a large new sales taxpayer that's gonna open up next year, I mean, I would be interested to see the numbers, but I would guess that most cities didn't budget for a 10, 15% sales tax growth.

I've seen some interesting projections on sales tax, because they are projecting at least, you know, the, the, uh, CPI increases, right?

Mm-hmm.

So, so I've... Like, I would not have projected 9% this year.

No. No.

Yeah, I mean, I just, I wouldn't have. I don't... Unless I knew exactly where that 9% was coming from, from new money, right? But only organic growth side, I would have never projected 9% in this year.

No.

Uh, because I... You know, if you read what is coming out of, uh, the CEOs and the private sector and so forth and so on, I mean, they're actually at the point now where they're, they're telling the Federal Reserve to stop raising interest rates, right? Like, you've got a lot of CEOs that have come out and said, you know, um-

It's, that elastic band is starting to, like, whip.

Yeah. And it's whipping faster than the Fed can see it whip.

Can see.

Right?

Yeah.

Yeah. Uh, Elon Musk actually made a statement last week. I thought it was a very interesting perspective on how the Fed operates. He said, "It's the time, it's time for the Fed to stop looking out the rear view window and start looking out the windshield." Right? Start looking forward, not looking backward. Uh, and because if they were looking out the windshield, then they would see that what they've already done has significantly slowed the economy, and it really is not gonna have any... It's, it's not necessarily the consumer demand that is driving the pricing. It, it, it... Don't get me wrong, there was consumer demand that was driving pricing, especially in, like, the travel industry, certain areas, because of the change in, in people's lifestyle, right? If you're a remote worker, you take a vacation any time of the year. You j- you just do. You just go. Um, if you're, you know, i- if you, if you're not tied to an office anymore, you don't have to wait for Thanksgiving holidays to go to Disney, right? You don't have to wait till summer to go to Disney, so forth and so on. And even school districts have adopted that. A lot of school districts in Texas, we just had one, I don't know if you guys have, but we have a fall break on top of a Thanksgiving break now.

Mm-hmm.

Right? We, we jokingly call it the Disney break. It's six days. It was last week. It's six days long, where it's basically like the school district just randomly has these holidays so that you can go take a Disney vacation when it's not at peak time-

Yeah

... but at the right time of year.

We've got, uh, Monday and Tuesday off next week for, like, uh, co- coinciding with Halloween.

Yeah. So-

A nice little four-day weekend there.

Yeah. And, and a lot of that was driven by policy at the legislature. They allowed schools to extend their school day by, like, 15 minutes a day, which gives them the ability to have more holidays, but-

It's, it's stupid, but whatever

... you know. Yeah, it is. It just is what it is, right? Uh, so the, the productivity loss in that is probably pretty significant if you look at those numbers.

I'm gonna work an extra minute every day, and by the end of the year, I'll have six hours off. I'll take a full day, and I will have-

Yeah

... gotten the equivalent amount of, uh, of work done.

Yeah, I... Look, you don't need to have that with, that conversation with me, man. I'm on the same page with you. But, um, so but my, my economic statement here is that we are, we have a disconnect in our country from policy and reality, I think. Um, you know, we have a disconnect between banking and Fed policy and Main Street, and what's actually occurring on Main Street.

Well, we also have a disconnect between, uh, Fed pol- fr- between monetary and fiscal policy.

Mm-hmm.

So you have the Fed trying to slow everything down, and you have the other ha- the part of the actual federal government that doesn't have to abide by that.

Yeah.

Right? They can spend extra money if they want to. They can do other things that could basically kind of counteract what the Fed's trying to do. And so that's really-

Well, they continue to put, they continue to put liquidity into the market, right? Through the monetary policy side, they continue to put liquidity out there, and the Fed is trying to slow inflation, but at the same time, when people have more and cheaper money, they continue to buy. It, it's-

Yeah, you mean the fiscal policy side.

Yeah.

That's right.

Sorry, the fiscal policy side.

Yeah.

Yeah. Yeah. So I, I think, I think it's a really interesting time economically. Um, I think people are feeling that, that slowdown, that pullback, that pain. I mean, why don't we just say we're in a recession? Can you... I- I mean, we are in a technical recession.

So we're in a recession insofar as typically when GDP has two consecutive quarters of negative growth, it's coinciding with other measures like high unemployment.

Mm-hmm.

Unemployment's low. Labor force participation is also low.

Terribly low.

We have a lot of, we have a lot of NILFs, uh-

Yeah

... people who are not in the labor force. And-

Yeah, between the ages of 25 and 50, 11% of the male workforce does not, is not included in the labor pool.

Yeah.

They don't work. They're not included as unemployed. They're just 11% of the labor force, male age 25 to 50, that are just not there.

Yeah. For every one person, for every one male of that cohort who is counted as unemployed, there are three who are just not in the labor force.

Wild.

So, so I think that, that is playing a, a part of it. And that's, again, that's kind of a hidden... problem. Unless you're looking at both metrics, you don't really see. You just see low, low unemployment. So

Well, I had a, so I had this conversation, uh, last week and, uh, I met with a, a federal rep. Uh, we had a kind of a business roundtable where business leaders from across the state came in and, and met, uh, with the federal rep. And we specifically had a conversation about this. You had sent me a podcast specifically on NILFs-

Mm-hmm

... as they're called, right? Uh, Not In the Labor Force is what it stands for.

Yeah. Get your head out of the-

Um

... out of the dirt.

Yeah. So you sent me this. I listened to it. I think I called you, like, right after I got off of there, 'cause I was shocked by the numbers. What I said... So, so the question was asked to me, you know, what do we... So what's the solution to that? And I said, you know, from a data standpoint. I said, "Well, like this, this is not, like, an educated statement, but I will tell you the biggest issue is we don't know where that 11% is, right?" We have no idea where they are, because the BLS is still collecting data like it was the 1950s. And so that 11%, are they out there just cash employed, not paying taxes? Avoidance? Like, what, what's occurring out there with that 11%? Like, why don't we specifically know? Why isn't that data connected to census data? Right? Like, why can't we track where it is? Because their comment was, "Well, you know, we had some really, you know, good reforms, um, you know, in like the Bush and Clinton administrations where we did a lot of welfare reform and unemployment reform and so forth and so on." They don't really know the solution to it because they don't know the problem. And my issue is, is okay, you, you, you know that there's 11% out of the workforce, but you don't know why. So go find the why. You've got to reformulate what the BLS is collecting and go figure out why this 11% is out there so that you can legislate. They either become part of the workforce... 'Cause I mean, look, do we really think that three people are sitting on the couch for every one unemployed person not wanting a job?

We do know that disability, uh, payments are a... They're not necessarily a, a problem. I don't mean to say it that way. But we do know that there are parts of the country where disability is, is being abused, right? So that-

And people gravitate towards those states-

Yeah

... because of it. Like, you know-

In the-

... Texas is not an easy place to get-

... middle of southeastern country. Southeastern, uh, Conference states.

Yeah. Some of those southeastern conf- But Te- like, Texas is not an easy state to get disability in, right? They have... It's pretty stringent. So you, you don't have a high percentage of it in Texas, but in some of the other states that you mentioned, and then in a lot of the northeastern states as well, uh, like the old Rust Belt states specifically, um, you know, you, you do. You have a high amount of disability payments that-

Yeah

... that are coming out. So that, that could be part of it, but-

But, but I don't think that that-

We don't know.

Yeah, I don't think that that is, would cover the full gap. So-

Yeah

... there's gotta be maybe some underground or just, I mean, who knows? I, I don't know how you would function without some kind of employment, even if it's not legitimate, um, as, as far as, like, I'm getting a paycheck and I'm, you know, paying taxes on it. So there's gotta be something going on, but I, I'm not equipped to answer the question of what is going on.

So I met... Or I, I met an umpire yesterday. My kids play baseball. We've talked about this in the past. Uh, we were at a tournament, a Sunday only tournament yesterday 'cause it's football season in Aledo, Texas. Um, and I'm talking to this umpire, and I'm asking him the question, like, what does he do? And he says, "Oh, I'm an umpire." I'm like, "Oh, okay." So he works just weekends, right?

For cash.

For cash.

Mm-hmm.

He makes on average $450 a day.

Yeah.

He works almost every weekend. So he works multiple sports, right? He works-

Is it about eight games?

About eight games, but he only works two days a week.

Mm-hmm.

Right? Full cash. I did the math. He makes $45,000 a year off the books.

Yeah.

Right? Working two days a week.

And yeah, and if you think about that, if you, to get $45,000 of after-tax income, you have to have a much higher salary than $45,000.

Yeah.

Um, yeah, when I was in college, I knew, uh, I, I used to umpire, and I know there were places where you could, you could get cash, and we, you could make 30, 35 bucks a game.

Well, now it's like 70 a game. 65 to 70 a game.

Wow.

Yeah.

Inflation.

And it's, and, um, and, and there are some tur- like, if you go out further west of town, you know, there are some tournaments that are, like, $50 pay at plate.

Mm-hmm.

So when you're playing for, like, a major organization that doesn't wanna deal with tax consequences of those payments, right? They do what's called pay at the plate.

Yeah.

And so each coach brings 50 or 60 bucks to each umpire. There's usually two umpires, and they make that 60 bucks cash right then and there at the game, right? And so they're working, uh, usually 11 games a day.

That's a, that's a lot-

If I remember

... of baseball

... 660 bucks, right? They're hour and 10 games. So I mean, man, it's just... But I, I just, I'm making that statement that the BLS has no idea that they're there-

Yeah

... right? They're not, they're not connected. They know they're an American. They know they live in a certain zip code. They know what their, what they say on their ta- on their census data forms, but we don't, we don't connect, you know, what's there. And I, and I'm not-I'm not saying that their profession is wrong or what they're... You know, being an umpire is a, is, is, I think it's a, it's, it's great, but we don't consider that a profession

Being a Little League umpire? No.

No. I mean, and, and, and that's because it doesn't meet our 1950s definition of a profession. We don't consider an Uber driver to be employed.

Right.

Right? So a lot of the side hustle, um, what, what is, what is the... They call it something, the economy, uh-

The gig economy.

The gig economy. A lot of the gig economy, they're considered unemployed. So of that 11% of males, you could have a bunch of, like, programmers, right, that are just gig programmers that are considered unemployed. And so it's just, I feel like if we could go figure that out, then we could fix some of our policies and, and, and an ability to track that, uh, a little better than what we do. So, and the umpires are gonna make more money because they're gonna have to pay taxes. So instead of being 60 bucks a game, they're gonna be 75 bucks a game, right? So that they could pay their federal tax bill.

They make that much in just regular league play, or is that just tournaments?

So in league play, we pay 50. We pay 40 to the 13-year-olds that work our games, right? So, yeah.

It's good money when you're young.

Oh.

It's hard money when you're older. You're outside for 10 games, and it's 100 degrees, and you have all that gear on. It's rough.

Oh, well, yeah, I mean, you know, usually they're only behind the plate for, like, you know, half of the day, right? And they're switching. Um-

Yeah. They'll do two on, two off if it's a long day.

Yeah. But, like, you know, we, we've got this guy, Kelly, who's our football referee, right? He's also our basketball referee, and we occasionally see him show up at baseball fields, and then he also does soccer. Like, a lot of these, that's, that's their career. That's what they do. And then in Texas, if they're part of TASSO, and they work their way up there, then it's like a full-blown career where they work high school games.

Yeah.

Right?

I think once you get to that point-

And then-

... then it probably is considered an actual career. But Little League is a bit ad hoc. It probably would not be considered a profession.

Yeah, but if I didn't do this, man, I'd be, I'd be, I'd do baseball all day. I could sit out the baseball field and watch baseball all day. So it's only really bad when you, you know, you're playing 9U baseball and your catcher can't catch the ball. That's, that's when it's-

Yeah

... tough to be an umpire.

Yeah. That's also when the strike zone starts to get a bit wide.

Shout, shout out to the umpires.

Ball becomes consistent.

Yeah, so we, we walked into a game. It was a 10U game. Um, the ump... And my son's a catcher, uh, and he can catch the ball quite well. But the umpire asked me before we got started, he goes, "Man, I just... That last team, the catcher couldn't catch anything." And he goes, "I, I just got beat up." And the guy was from Paris, Texas, by the way. And, uh, I said, "Oh, you'll be okay this game." He didn't get hit one time, and he goes, "Man, I was calling strikes just 'cause he was catching the ball." I was like, "All right. Thanks, man."

The thing is, you gotta, you gotta position your body so that your shin guards and your chest protector are actually doing the job. You can't leave your thighs open, um, which maybe I was able to do better because I'm, I was about the, the height of an average 10-year-old. But-

Yeah

... uh, yeah, you, you gotta be careful.

Well, now they have, like, the, they have, like, the bodysuits that are made out of, like, football pads, right? So-

Oh, wow

... they're really, really light. They're not near as heavy as they used to be, right? It's not like the big suit that you used to have to put on before.

Yeah, we didn't... Uh, we, we still had pretty lightweight, but they had shoulder, uh, shoulder pads and then the chest gear thing that kinda came down to a point for added protection.

Yeah. Yeah. That was... Man. The, um-

The worst was-

Yeah

... getting hit off the face 'cause when you get, like, you take a foul ball, 'cause the kids are not gonna catch a, a foul tip.

Mm-hmm.

So when you take a foul tip off the face mask, that's, that's probably the worst thing that's gonna happen to you, assuming that you're fully protected, if you know what I mean. It's probably the worst thing that'll happen to you as a Little League umpire.

Yeah. Yeah. So we did, we had one that got a concussion once, um, um, when-

Did he get hit in the head with a bat?

He got hit in the head with a ball. The ricochet of the ball gave him a concussion.

Gave him a concussion?

Yeah.

Wow.

So, um, it was a, you know, it was a 10U tournament, but kid just swung hard, ball came off bat hard. Just, you know, physics. Wasn't, wasn't too friendly to him, and he wasn't wearing a... They make, like, a face mask that's just, like, a standard catcher's mask, right?

Mm-hmm.

And then they make one that's, like, a shock absorber mask, and he didn't have that, like, shock absorber mask on. He... 'Cause it was, you know, younger kids. He didn't think he needed it, and he had a concussion.

Yeah. I paid for the super upgraded padding. It was, it was very nice.

Yeah. I mean, it's, you know, it's nicer padding, and now they have, like, the one, it's got, like, it's got, like, a, like air springs in it. It actually, like, absorbs the hit of the ball. So it's gotten real fancy there, Chad, since you've done it. Maybe you should get back into that.

Yeah. It's probably been 15 years. Of course, I have four kids now-

I hear y-

... so it's tough for me to take a-

I hear the youth baseball parents... Yeah, I hear the youth baseball parents in today's world are just much easier to deal with.

Oh, I'm sure they are. If the youth soccer parents are any indication, uh-

Yeah

... I'm sure that they are.

Excellent. Excellent. Well, I, I think that's it. Man, I think we've wrapped everything up for today.

All right.

How you feeling?

Feeling good. We went long.

All right.

It's gonna be fun editing.

It, it should. It should. It may end up being two podcasts maybe. We'll see. So anyways, well, we appreciate you guys tuning into us, uh, and listening to us. As usual, uh, our information and the stuff that we talked about will be in the show notes, so if you wanna go listen to those podcasts or check out some of those articles, feel free. Until next time, Chad, we'll see ya.

See you, bud.