Greetings, and welcome back to ZacCast, your official podcast for local government nerdery. My name is Chad, his name is Patrick, and, uh, I think we have a wonderful, great show for you today. What do you think, Pat?

We do. Chad is all worked up in a tizzy, so we're gonna, we're gonna roll down this tizzy.

I'm not in a tizzy.

Yes, he's very upset about sprawl development this morning, folks.

No, it's not a tizzy. I'm just questioning the, the assumptions that we as a society hold, and we take them for granted, that's all.

Okay, so we got two topics, maybe a two plus one topic at the end. But we got two topics today. First topic is-

Are you h- are you holding a special secret topic?

I wanna, I wanna talk about interest rates a little bit. I know you think that's boring.

Okay.

I, I did go ahead and say that we were not gonna have any conversation about Diddy. We're gonna leave that one.

Sorry.

That, that wears you out, conversation about Diddy? So-

Diddy, I don't give one... I, I don't- I have no part of my body that cares about what's going on with P. Diddy right now, or Puff Daddy, or whatever his name is.

Yeah. I, I anyway-

I have no idea why he was arrested or indicted. I, like, I don't care to read about it or learn about it. It does not interest me at all. Like, celebrity news-

Yeah, salacious celebrity news

... is so boring.

You never watched TMZ-

I d-

-like, in college?

No.

Okay, I did. I watched TMZ in college. I liked it. Am I terrible for that?

I don't care what celebrities are doing. They're just people.

They are just people. Speaking of, in Parker County, we have a number of celebrities that have relocated out to Parker County and live in the country now.

Like McConaughey?

No, McConaughey's not here, but there was a supermodel at the H-E-B the other day.

A supermodel?

Yes, who was on The Real Housewives-

Now, how do you define that term, like, in the traditional sense?

The only reason I... The only reason I know is 'cause my wife knows that she was on The Real Housewives of California, LA? I, I don't watch that show, so I don't know.

So is she a, a legit supermodel, or is she just a model?

Uh, I think she was a-

'Cause, like, a supermodel, you're talking, like, old school, you know, Christie Brinkley, Elle MacPherson, you know, Naomi Campbell. Like, these were, like, super celebrity models, and maybe I don't follow that stuff anymore 'cause I'm not a teenage boy anymore.

I don't know, it's-

Are, are there big names like that these days?

So I didn't know- I didn't really know who she was. Uh, but, uh, Gigi Hadid.

Okay, I've heard of that name. She lives in Parker County?

Yeah, she has built a house down from Taylor Sheridan's place in, in Parker County, yeah. Anyways, back to, back to what we're talking about here. A good little transition. Um, we have two topics that we wanna talk about, and then we're gonna talk a little about interest rates. Chad doesn't wanna talk about interest rates 'cause that's boring. He also didn't wanna talk about Diddy because he doesn't care about celebrities. First thing first, we're gonna talk about the sprawl that continues to happen in the North Dallas suburbs. Uh, Chad's got a story that he's all up in a tizzy about, and we're gonna jump on that here pretty quick. And then the second thing we're gonna talk about is a bit nerdier. Uh, it's something that I've been digging into for the past couple of weeks and making some phone calls to learn more about, uh, and that is TDU line charges and why those have been going up so drastically, and why your electricity bills have been going up if you're in one of the major TD, uh, TD, TDU areas. So TDUs are, uh, line charges that are related to electricity for, like, Encore, uh, CenterPoint, uh, some of those major players. Why are you looking at me with that crazy face?

I want you to save that for that segment.

Well, I am gonna save it for this.

You're over here jumping the gun-

Well, I wanted to give a strong preview

... destroying- you're ruining the flow of this episode.

I wanted to give a-

I, I made, I made a very grand promise that this was gonna be a good episode, and you're over here doing everything that you can to derail it.

Well, I'm a little scared that your anti-sprawl comments that are about to come out are just gonna scare everybody off from the rest of the podcast, so I had to get it out there. Okay, let's talk about your tizzy now. Are you ready?

Yes.

Okay.

And again, it's not a tizzy.

It's-

It's just a comment.

Okay.

Okay, so I came across two different articles, both about Dallas era, uh, area developments, okay? The first one is a pretty massive mixed-use development in the McKinney area, almost 2,500 acres. Um, millions of square feet of mixed-use space is what they say, uh, thousands of homes and apartments. I thought I saw something here about commercial as well. Um, and then this other, other one is about a 500-acre development in the... Like, one of the only still available large tracts of land in the Collin County area. Um, 557 acres, 2,200 homes, um, in, in the Pilot Point area. And so I wanna highlight just... Th- this article is basically just like a press release, which is one reason that I really think that we should be investing more in, in local news. Right? I remember when I was doing budget, and the local paper would come ask me about the city's budget.

Mm-hmm.

I could just tell them whatever I wanted. There would be no fact-checking, no context given. Like, I could basically write the article if I wanted to.

Yes.

I feel like there's a lot of that in local news-

That report-

... which is unfortunate.

Yeah. That, that reporter, by the way, is now my son's journalism teacher.

Oh, my gosh.

Yeah.

Are you serious?

Yeah, yeah. So the news business-

I hope he learned something

... got so bad, they, she had to go into education. Poor soul.

Oh, it, no, it wasn't a she, it was a he.

Oh, okay. Yeah.

Yeah.

We had different reporters.

I, I think I know who you're talking about, but it, that wasn't-

Yeah

... the person I was-

Okay

... I was referencing. Anyway-

I had the strong exposé-

Uh

... reporter, so everything was an exposé.

There's a lot of scandals going on out there in Parker County.

It's... It was a lot.

Apparently got supermodels-

Yeah

... hiding amongst us.

Yes, correct.

So okay, so two quotes worth, uh, worth noting.... First one: "We see the area west of Celina and east of Pilot Point as a natural extension to the rapid single-family development that this area has experienced. Pilot Point is well-positioned for exponential growth in the coming years. As prices have appreciated in Celina," this is the second quote, "we believe Pilot Point is the next community that will benefit from the continued growth along the northern tollway." So I wanna unpack the assumptions that are baked into these quotes, and then just open them up for a discussion.

Go forward in your tizzy.

Okay, I think the listeners will hear that I am not in a tizzy whatsoever. Like, no matter what definition of the word tizzy that you might, uh, uh, adhere to, I don't- I don't, I don't fall into that category. My, my comment here is just, like, let's look at these assumptions, okay? So the first is, we've had rapid single-family development. There's a natural extension to this, okay?

Right.

And in this case, Pilot Point, which is like an hour and five, 10 minutes away from downtown Dallas, like, it's way out there. It's, it's pr- closer to Sherman and Denison probably than, like, the heart of the Metroplex, um, is well-positioned for exponential growth. Now, I'm gonna do a little bit of research here, and then maybe they're using the word exponential, uh, euphemistically. But Pilot Point has about 5,000 people. Like, if we're gonna grow exponentially that far out from the Metroplex, and this is, like, the natural extension of how we build, what are we doing here? Um, not that I don't love our friends in Pilot Point, you know, and I don't begrudge anyone for wanting to get growth, but h- like, this is a natural extension of what we do. And then the second one is, that Pilot Point is going to benefit from this, like, full stop. Are they? Maybe in some ways, but as we have discussed many times over this podcast, this type of development pattern is not fiscally sustainable. So where does that beneficial aspect come from, and why is it just assumed that this development is going to be a net benefit? So z- to me, those are, those are two assumptions that are kinda baked into just how we view the way that we are growing and building things, especially here in the Metroplex. Now, the caveat here is, obviously this is... these are quotes from one of the largest home builders, uh, in, in the Metroplex, right? So, like, this is their business, that they rely on this for, you know, profitability, and growth, and, and revenue, and things like that. So of course, this is the assumption that they're bringing to the table, but why does it have to be the assumption that everyone else just agrees with? That's my, that's my comment.

Okay, so first off, this develop-

So what say you?

So first off, this developer has six developments in Celina, right?

Oh, yeah.

Yeah.

They have plenty, a lot-

Yeah

... lots of stuff.

And to put this into perspective, between July of '22 and July of '23, Celina was the fastest-growing city in the United States.

Uh, uh, real quick. Again, everyone says that, so-

That's according to the US Census Bureau.

Allegedly.

Here-

Anyway, go ahead.

Here's the other number that was thrown out. In that same time period, over that one-year time period, their population grew by 26.6% in a year. I'm just-

That's insane.

That's insane. That is insanity.

Is, is that a healthy growth rate?

I don't know if it's a healthy growth rate, um, but I think it-

Let, l- l- let me put it in a different context.

But if we don't build the affordable... Like, we can't have our cake and eat it, too, right? So you said something in the green room that really struck me, which was, you know, why do we have to go that far out? There's other areas where we could do this growth that are more central, right? Why does it have to sprawl so far? Did I put words in your mouth there? I don't want to.

Well, I mean, I think it's a question of so far and also so fast at the same time.

Okay.

And then before you get to that, let, let me just put that comment in context, okay? Let's talk about... And I hope this isn't too sort of on the controversial edge, uh, of things, but let's talk about the climate, okay?

Okay.

For millions and billions of years, the climate has shifted, right? It's gotten hotter, it's gotten colder. We've had ice ages. They've ended, right? Like, the climate changes over time. A lot of that has to do with the sun itself, and, you know, that's all fine. I think everyone acknowledges that. I know that there's some controversy on, like, man-made global warming, but I think that it's reasonable to say that one of the biggest problems that we face with any kind of climate change right now is the rapidity, right? When it happens over thousands and thousands of years, we can adapt to those changes. When it happens over 50 years, it's much harder, right? If you, as a child, are growing, uh, you know, at a normal rate, and then all of a sudden you increase, like you have a humongous growth spurt, like a Six Sigma growth spurt-

Mm

... that's gonna cause a lot of challenges for you, right? Because it's just happening so fast. And so that's kind of my point here, is 26% growth rate in one year, that's apparently the fastest growth rate of any city over 20,000.

Right.

So 20- 20,000 to 25,000, like, it doesn't seem like a lot, but that's a lot of change in a single year.

Yeah, and, and let's-

Um

... let's, let's go back and look at this. Like, Celina became a client of ours, like, really early-

Mm-hmm

... really, really early. I don't think their population when they became a client of ours six, seven, eight years ago was more than 5,000 people.

I don't think so, either.

Like, when we went to Celina City Hall-

I mean, think about that

... there were, like, five people there.

There was, like, a Sonic, and that was it.

Correct. I think they had recruited, like, their first, like, Brookshire's Grocery Store, but it hadn't been built yet, right? So-... yeah, the, the dramatic growth that's there. But I, I- here's the issue, the- and this is a national issue, this is not a local issue. The issue is the path of least resistance is large-scale suburban sprawl development, single-family households on quarter-acre lots. That is the path of least resistance. So we have created in a market, so specifically, and that's the lineup, Pilot Point, Prosper, I mean, all the way up around-

Right, Melissa, Anna, like-

Melissa, Anna

... all of those corridors-

That whole, that whole northeast side

... just expanding, radiating out of-

And, and in full disclosure-

the Dallas area

... I, I, I didn't give a single name of a city that we don't work for, right? So lit- literally, we, we work for everybody over there, and we have lots of phone conversations and lots of conversations with those folks that are there. And those cities are specifically looking at fiscal analytics, many of them are. Maybe not all of them, but many of them are, right? Um, Salina, for example, is in a search right now for a strategic services director to specifically look at these type of issues, right? That they've- they're doing the things that they have to do to try to do that. Now, is it a little later than it probably should be? I don't know. Maybe. Um, but the reality is-

Better late than never.

Better late than never. But the reality is, is th- these, these areas are faced... People are not just moving there because they're moving there. People are moving to this area because this is where the jobs are nationally, right? Employers are moving from all over the world. Okay, I mean, you, you, you... There's another article, like on the Apple News Feed that you sent me to, to read this article. If you stick on that feed, there's another article that talks about, um, a large company moving to an office building, uh, in- at the farm development in Allen, right? So that's, that's what's occurring, is that you're seeing large swaths of development go to those areas. You're seeing large employers that are moving to Sherman, Texas, that are moving out of central cities, right? You're seeing large chip manufacturers, tech companies, um, all types of folks that are basically, because of- for the same reason people are trying to go out there and buy affordable houses, employers are trying to move out there to get afforda- uh, get, to get affordable employees. It's, it's the same, the same drive. Those employers are coming to Texas because wages are lower in Texas. Those employers are no longer looking at Austin, because Austin got so hot, wages became comparable, right, to Silicon Valley in California. And so you now have a, a new market of companies that are still looking for educated talent, 'cause that's the thing about the Texas market or the Texas triangle, whether you're looking at Austin, San Antonio, Houston, Waco, um, College Station, all these different areas. I gotta say it out loud for you, Chad. All of these areas, they are full of highly talented employees, uh, of human capital, uh, well-educated, highly talented human capital. Employers are coming here. When the employers come here, it drives employment growth. Employment growth drives a need for housing. This is not new to Texas, and it's certainly not new nationally, but it is exacerbated in Texas because it is, uh... You know, I think they used the wrong term, uh, in, in that article, but it is, the growth rate of it is astronomical. Um, and they have to go somewhere. Now, my point being, I don't disagree with you that, like, why should we just go out there and buy 550 acres and just turn it all into single-family neighborhoods? I, I, I don't, I don't disagree with you. I think it- and I'm sure there's, like, TIRZ districts attached to that, and there's PIDs on top of that. There's all types of stuff for that developer to pay for that urban sprawl infrastructure, right? 'Cause it's not cheap to run a water line, to run a 16-inch, 18-inch water line to be able to handle that 550 acres. It's not cheap to build that four-lane roadway and improve that county thoroughfare. Um, all those things are basically being paid for under a TIRZ burden or a PID, uh, additional tax on top of what those taxpayers are paying, typically within that neighborhood. Um, but we could do a better job of looking at how our money works, our tax values work, and what our returning investment on those developments are. 'Cause I think if you look really closely, we have enough data, specifically in these areas, whether we're talking about, uh, you know, Pilot Point, or Salina, or, or Anna, or Prosper, any of those communities, we have enough data points to know that maybe the stuff that we started in the '90s is not as profitable as it should be, and if we had done a few things differently, we'd be in better shape, right? And I, I'm not sure these cities are really prepared for that. Many of them are still building residential road segments that are 28 feet wide, plus some of them are 32, right? Uh, so I get what you're saying, but people are moving here because that's also where the job growth is. Have you driven that section of the Dallas North Tollway that's under construction?

Um, let me see.

You, you kind of stop at the FC Dallas Arena, right?

Excuse me.

You don't, you don't, you don't ever go further north than that for all y'all's soccer activities?

I think the furthest I've been recently is probably the McKinney area.

Okay. Uh-

Um, but no, on that side, I haven't been much past the Toyota Center.

So both Salina and Gunter are locations that we play baseball in pretty regularly, and, a- a- and Gunter, I love you guys, but I, I can't stand driving all the way up there. It's hard, 'cause there's no way to get up there highway-wise. It's all, uh, two-lane back road. But you, you basically get north of Frisco, and then they're building the Dallas North Tollway, but it's all, it's all, like, access roads with stop signs. So you sit at stop signs for a solid, like, 10 or 15 minutes at each stop sign, and you have to hit, like, you know, two or three of them to get where you're going.... uh, down that road, and there's just residential development after residential development after residential development on that roadway. The commercial's coming right now. Uh, there's some commercial developments coming, um, but the densities are not correct, right? The, the way the residential builds are done are, are not sustainable, uh, right now. They may be in the future, but they're not right now. Uh, because there's not enough diversification of the tax base in those areas yet to make it worthwhile. But those places are overlapped with substantial special district overlaps, right? Where somebody is sitting in, say, um, Fort Worth, and they have a tax stack in Fort Worth, which, you know, Fort- Fort Worth has a, a, a high city tax, right? But let's say they have a tax stack of, of something north of, you know, 220 or 230, some of these people are paying tax stacks that are right below $3 per 100, uh, some of them edging a little over that in order to afford it. So, so yeah, you can go to a neighborhood and get a nice house, and that house may only cost you $400,000 to buy, but you're gonna make HOA payments and special district fee payments of, like, 3 to $400 a month, uh, on that. So, uh, there's a give and a take, and I, I hope that, you know, the, uh, the beautiful pool and what do they call that thing, the fake beach that they build in a lot of these neighborhoods now? What's that called?

Fake beach?

Yeah, it's like a... It's like, oh, the lagoon. They call them lagoons. They build, like, sandy, white sand lagoons, so like blue water lagoons.

Are these for people to use?

Yeah, it's, it's a, it's a neighborhood amenity, so-

Do they use them?

Yes, they're like a pool, but they're built like a beach. So yeah, they get used. I mean, y- to each their own, right? But how does the city make money long term? That's, that's the question. Uh, so I'm, I'm there with you. How do you say you're not in a tizzy, though?

I mean, I'm not, like, apoplectic about this.

Okay.

I'm just... It's just interesting to me, the way that we discuss it makes a lot of assumptions that we take for granted, right? Well, of course, people are gonna just keep going up the North Tollway, and we'll just expand it and expand it, like, all the way to Pilot Point, and it's gonna be... Like, that's just what we do. Why wouldn't we do that?

Yeah. Yeah, no, I, I get that. I think this is interesting, though. I mean, I have-

Jobs have, like, leapfrogged the sprawl in some of these areas. I have made an hour-long commute, like, one way.

Mm-hmm.

I did that for nine years. It's freaking awful.

Oh, yeah.

I, I, I wish, I think, that people... Like, I don't begrudge any of these cities for doing this, 'cause this is, you know, this is, like, the template, right?

Right.

But I don't know. I feel like-

I mean, you said it there

... that-

This is the template, right? This is the path of r- least resistance. Developers are gonna go and buy and build the path of least resistance. If we gave them another path of less resistance that was fiscally more sustainable for cities, they would build that path, and you could get more housing probably on the ground in that path.

So how is Houston doing it? Because we talked about this last time, and I assume that we're probably on the next episode we're gonna talk about this as well. A lot of it-

Houston has no control.

No, no, no, no. A, hold on. A lot of it comes down to the financing.

Correct.

Right? Like, this is the kind of project that you can easily get financing for.

Right.

H- uh, Houston has done a lot of still single-family, but like townhomes and, and-

Mm-hmm

... and smaller lot developments, um, both in their more central areas, but also, um, uh, you know, a little bit further out of the downtown area. I mean, we have the greater population here, not maybe density, but we have a greater population in the DFW area, so how is the financing world different in the Houston market than it is up here? Like, w- do you know what the difference is? I mean, I know your dad kind of-

Yeah

... has some experience down in that area.

Yeah, I think, I think in Houston, uh, developers are significantly more creative, and so the banks themselves have to understand the creative deals that are done in Houston, which are different, right?

Why are they more creative?

Because in, in Houston-

Because they can be? Because they don't have the same-

They don't have the same restrictions

... um, the same development environment?

Correct. And because they're-

So what you're saying is-

There is no path of resistance. No, I mean, uh, your comment here is gonna be because there's not zoning, right? And so if we just eliminated zoning, we would fix all these issues.

Uh, no, I'm not saying that.

Okay. But, I mean, the, the reality is, is that the path of least resistance... In Houston, I can go, i- if there's no HOA deed restriction on it-

Right

... I can go into an area of Houston that was built in the 1900s, and I can buy five houses, tear them all down, and build 20 townhomes, right? And I can do that right next to an existing single-family neighborhood. Uh, and it's just like that's, that's an assumed mentality. It's an assumed understanding in Houston that that can happen. Um, but also to be said there, outside of the city of Houston, it's significantly-

It's

... worse-

Yeah

... than-

Yeah, it's, uh, just business as usual.

Well, it's the- it's business as usual, but it's, it's like the Wild Wild West version of business as usual, right? There's no governmental entity, um, to really slow things down. I mean, until they put in flood control prevention, uh, which was, you know, post-Hurricane Harvey in Houston, I mean, really, a developer could buy any dirt anywhere and just put a neighborhood in, um, and, and do that, even if it was below the flood levels. I mean, they're... You know, they could put a levee around it, form a levee district, charge you a levee district tax, hand the levee over to you-

And you're still gonna flood

... And oh, by the way, the water's still coming over the levee. Yeah, I mean, it's, uh, uh, it's a, a nightmare scenario there in the Houston market. So, um, at least in the city of Houston, they do have some checks or balances. Their management structure, on the other hand, is-... rough, um, from a city standpoint because it's so politically driven and strong mayor form of government. Um, and so, you- Houston's probably gonna have a pretty good run over the next 10 or 15 years right now, just because of the mayor changes that have occurred in Houston and some of the professionalization of the staff that's gonna occur. People can kind of see that there's, like, an 8- to 12-year window here where you're gonna see this growth. But yeah, I mean, there's no path of resistance there, so I- developers are gonna get the most out of what they can get, right? And the more buildable square footage that they can get on every square foot of dirt, the more money they're gonna make. Um, and developers in North Texas, you know, the biggest hurdle is entitlements. Uh, you know, full disclosure, Chad, you, you and I worked on a development. We just, for the fun of it, were like, "Hey, let's go do a 60-acre deal, and let's go through it." And, you know, we, we talked to three or four different investors who were North Texas investors in dirt development here, and we got yeses from every single person we asked along the way. Um, why did we get yeses on that? Because what is, what is the easiest thing for you and I? Entitlements, right? In their world, it's the hardest thing. It's like, for you and I, it's like working through a zoning ordinance and doing entitlements and figuring out what I can build and doing a land use plan and going through platting and prelim and all that type of stuff, like, that's just, that's cake for us. But for developers, it's not, and there's a whole industry around them of engineers and planners and that type of stuff that-

Lawyers.

Lawyers- ... and, and everything else that drive that bus. And so, um, and in North Texas, w- we're not gonna change that 550-acre development going into Pilot Point as the next frontier unless we change the path of resistance, um, for cities, and, and that's inward and outward. Outward being, "Hey, developers, we know historically this is what we've built, and we know how we make money, and we don't really make money the way that this is going, so we need to transition to something a little different." And it's also looking inward at, a lot of times we don't make money because of what we require developers to do, right? It's, you know, I was talking about road width, um, but that, that's, that's just a prime example, uh, of that. Um, the road width side is, is one of those areas where just by changing road width by four feet, you could take a development from profitable to... or from unprofitable to profitable, so.

How do you feel about the, um, the cities offering, like, prepackaged, pre-approved, uh, plans and designs?

Uh, I think it's a real-

So, like, a developer comes in and says, "Hey, I'll do these, you know, these things here," and you just get, like, immediate approval.

Yeah, I, I, I think the hurdle of entitlements is a harder hurdle than the hurdle of financing. So even in today's market with high interest rates, I don't think financing is that difficult in North Texas.

Ah, ah, ah.

Yep.

We might have a, a rate cut by now. I don't know-

No, 2:00 PM

... when this is coming out.

2:00 PM, 2:00 PM gets announced this afternoon.

Okay.

We're currently recording at 10:20 AM on Wednesday, September 18th.

Central Time.

Central Time. Yeah, for our California listeners.

And our one listener up in Boston, shout out to Maria.

We'll see if she hears that.

Does she actually listen?

I don't know. I don't care.

I wouldn't blame her if she doesn't.

Yeah.

It's not like she doesn't know what we're saying.

That's true.

We all talk about the same stuff together. So, uh, yeah, okay, I think that's fine. That's a, that's a fair place to kind of wrap that one up. Um-

But, but hold on

... I know it's been too much time.

I, I do wanna-

You got more?

Yeah, uh, no, I just wanna hit that last comment that you made. To answer your question very clearly, I like cities who go out and plan dirt and say, "This is what we believe is good for our community." A comprehensive small land plan is, is a good way to start, and basically telling the development community, "If you work within this or within 25% of this, you're basically, like, pre-entitled," I think that's awesome. And the reason I think that's awesome, because it also takes out a lot of that NIMBYism that occurs, because people understand what's coming to their community and what is, you know, what's gonna be there in the future. Like, it's... W- we hear this in, in Parker County all the time. People are like, "Well, you know, Parker County is one of the fastest places, blah, blah, blah. All the cow pastures are going away, and all the trees are going away." There's no trees in the cow pastures, guys. But the, the reality is, is that that land was always gonna be owned and developed. Um, if we had a land plan that kind of showed people what all that was gonna be before they moved out here, then they could make a wise decision on whether they wanted to be here or not. Um, but we could say the same thing about thoroughfare planning, right? I feel like with thoroughfare planning, we've become, um... At A&M, they have this rule, you don't walk on the grass at MSC, right? But Aggie engineers have this rule that you don't build sidewalks, right, until you see the path that's built by somebody, and I feel like transportation planning has become that way, too. Like, we're gonna wait and see where all the terrible traffic is, and then we're just gonna fix that traffic with expansion of roadways.

Yeah, but you don't have to wait and see. You can tell.

Correct.

Like, where I live, you could see it coming from a mile away that there's, like, four roads that you can use. Everything else is a neighborhood road, and then you're gonna build a craps ton of neighborhoods, put thousands and thousands of homes in a relatively small area, and funnel all those people to the same roads. Of course, those are the roads that are gonna be congested.

This is- this was a very funny conversation that we had yesterday, and I- we're gonna end with this conversation. But yes, the traffic by your house is atrocious. I drove by it the other day and called you, and it was horrible.

Oh, y- yeah, go, go ahead.

But-

I know everything.

... uh, Chad, Chad went and got a haircut yesterday in the morning, and, and probably went to, like, a, a Great Clips or something like that. I don't even know where you went.

It was a Supercuts.

A Supercuts, yeah.

They open earlier than the Great Clips.

Okay, so he went to a Supercuts and got a haircut. You know, it, it does actually look pretty good, but he tells me it was the lady's first haircut ever-

Ever

... outside of, like, school, right? It was her first haircut.

I'm not even sure she has her, like, license yet, which, to be fair, I'm not a fan of licensure.

... wow! I, I want the person to cut my hair to be trained to cut hair. Just gonna throw that out there.

But, and you need the government to tell you that they are trained, right?

I don't necessarily need the government to tell me they're trained.

Okay.

I just wanna make sure they're trained.

1,500 hours worth of work-

To get a-

It doesn't even take that much to get a real estate license.

Well, I mean, real estate agents grow on trees. But yeah, so you went... So I said to Chad, I said, "You know, Chad, we're doing pretty well. Uh, the company's doing pretty well. Um, maybe it's time for you to, like, go to a real barber shop," 'cause I, I... What, what do you pay at Supercuts for a haircut?

The haircut's, like, 22 bucks.

Supercuts, right, 22 bucks. I pay 35-

Mm

... I think, and I go to, like, a-

You don't even have any hair to cut.

Hey, look at this beautiful face.

You could literally just, just buzz that.

You're as bad as my kids. "So you're going bald, Dad. I can see the shininess." Whatever, I hear it all the time. But I said, "You should go to a barber shop. There is a Floyd's Barber Shop right down the street from your house." Your response to me was, "That's not right down the street, it's 20 minutes."

Mm.

Legitimately, roadway-

It's, like, three miles away, 20 minutes.

It's three miles away on the road, 20 minutes.

Uh, it's probably, like, seven miles away, but yeah.

I don't think it's that far. I don't- I, I mean, it's goofy 'cause of, like, the 287 flyover and the 35 and, like, how that works.

Yeah.

You gotta go the back road to get there, but still. I mean, I think maybe it's, like, five driving miles, worst-case scenario. 20 minutes, that's wild.

Mm.

That's wild. I, I-

That's my life.

Yeah, that is, that is crazy.

Yeah.

And, and-

There are literally times-

My, my life is getting that way, I think.

There are times, times of the day, where just getting across the bridge on the highway, like, sort of on the edge or-

Mm

... outside of my neighborhood, will take me 15 minutes.

Yeah.

And I'll tell you one thing, part of that is because everyone else is so frustrated that the way that our cycle works, the one on the opposite side, it's like we have, like, a two-lane frontage road, and then on the opposite side is a one-lane frontage road. So the left-hand turn lane from that way, those people will not only take the intersection, they will just sit in it. Then the light turns red, and they have, like, four cars just queued up in the intersection, then they have to slowly go across the bridge. So, like, the right-hand turn from my direction, maybe one car, if we're lucky, will get to go on a green.

Wow!

That's part of the problem, but-

Yeah

... just people are jerks.

That's terrible. All right, ne- on to the next issue.

I think what they need to do, I think we need to have, uh, at every intersection, is bollards or spikes or people, like, like, knights on horses with maces, and just shoot those things up when the red light happens. That'll teach people not to run those lights and to be courteous. The thing about, the thing about the traffic in these areas, and we can end on this if you want, or I can cut it, everyone feels so entitled, like they're the only person driving. So of course, like, "I, I don't, I don't care about you. I'm gonna go in the straight lane and then cut in front of a bunch of people in the left lane. I'm not gonna wait, you know, 30 cars like all you suckers. I'm more important, so I'm gonna do that." The thing about it is, if everyone did that, society would break down. Like, it would just be utter chaos. But I, I don't know what it is about just, like, this feeling of entitlement when you're driving. It's like, "I don't care about anyone else. I'm gonna just do whatever I wanna do."

Just remember, folks, Chad, this is not what got Chad in a tizzy. It all started with the 550 Acres development sprawl.

And what's the deal with people not stopping at stop signs in school zones?

Yeah.

Speeding through school zones, not even rolling, just not even stopping. I almost got T-boned yesterday picking my son up from school because someone was just on a 40, 40 mile, uh, 40 mile an hour collector road.

Okay, Karen, you ready to move on?

Just burning through it. I mean, what kind of world are we leaving our children, is all I'm saying?

This is for sure gonna get cut.

All right, let's go to your topics.

All right, here's, here's my main topic. My main topic is I wanna talk about TDU electric delivery charges. So I started-

TDU electric delivery charges.

So I'm a big-

Define your terms here.

Okay, so there are two parts to what you pay in electricity in Texas if you're in the open market, um, deregulated areas, right? So in, in North Texas, that would be if Oncor is your line company. In the Houston area, it would be CenterPoint. We have seen tremendous increases in electricity rates. People are seeing hundreds of dollars a month in additional electricity costs versus what they saw two to three years ago, right? Pretty much since Winter Storm Uri, we have seen significant increases in delivery charges. Uh-

Which one was that? Was that the snowpocalypse?

That was the snowpo- snowpocalypse, yeah.

Okay.

The big winter storm. So the question that I had was, why? Why are we seeing such increases in electricity cost, and why is that happening now versus why didn't it happen 10 years ago? And so i- what I came to the conclusion of is, there have been a lot of changes since Winter Storm Uri that have occurred statutorily. So there used to be a rate-making process that Oncor and CenterPoint would go through, where they would have to submit to the localities and the cities to which they had franchise rights to, right? The ability to run lines within utility easements, um, that they would submit in a rate-making process, and there was a 90-day rate-making process that these companies could go through once a year, um, to basically, you know, fight for those rates and go through the PUC to get those rates approved. Now-

These are for the delivery rates?

These are for delivery rates.

Right, not, not, like, the commercial retail rates?

Not for the commercial retail rates.

They get passed through into that, right?

Yes, correct.

Yeah.

But when you go to Power to Choose, right, when you select a plan on powertochoose.com as a Texan, you are selecting a rate that includes that delivery rate. So many of us-... prior to winter storm Uri, we're paying six to seven cents, some of us eight, but, you know, somewhere between six and, and eight cents in electricity rates, including TD line charges. Those rates now, if, if you search that out, especially if you want a contract that's longer than nine months, uh, those contracts are gonna be somewhere between 11 and 14 cents, depending on what you go after and how much electricity you use in a house.

I'm seeing 10-

So change your-

10.4 in your area.

So change off the three-month plans and go to the nine-

Oh, yeah.

- the 12-month plans. Yeah. So, but when you, when you look at this and you start asking the question, "Well, why are rates going up so much?" To put this into perspective, CenterPoint Electricity, back in March, requested a fifty-seven percent increase in their line rate. Now, line rates make up typically about half of your electricity bill, right? Um, so if they're looking-- So, you know, if you used to pay three hundred dollars a month for, say, a twenty-eight hundred square foot house, and now you're paying six hundred dollars a month for a twenty-eight hundred square foot house, the electricity charge has gone up a little bit, right? We've seen some movement in electricity charge. It's gone up a couple of cents, but the line charges have gone up dramatically, and the question is, why? And so I started digging into that, and then I started digging into how can people better control their electricity charges, so forth and so on. So the state has done a couple of things to try to figure out how electricity in the grid can be more sustainable in Texas. One of those things is, because the industry asked for it, is the industry needs to go and do a bunch of upgrades to their line system. So for CenterPoint, for example, didn't change a th- a thing when the tropical storm hit Houston a couple months ago. They've upgraded a bunch of their wood poles to concrete and steel poles, right? To basically have better, uh, capabilities during hurricanes. And then they get to tr- pass those charges through. The state has come in and taken away the authority of some local cities to be able to regulate that like they used to, and also, they have limited the time period for appeal to sixty days from ninety days to make it easier-

And-

- and quicker, and they've now allowed them to go do this twice a year instead of once a year. So now there is both a rate increase that occurs within the fall and in the spring. Funny enough, could you imagine if cities would adjust our water rates twice a year? How upset people would get? Like, this is, uh, I mean, this is what's occurring, is that people are getting hit with increases not once, but twice, and then it's happening every single year. At this point, since the new law has passed, the energy companies have been passing through increases every possible chance they've gotten. They have not skipped a single one, Encore and CenterPoint. Why do you say? Because the more investment that they make, the more return on investment that they make. They are publicly traded companies that are guaranteed under the rate base to make a profit. They get a guaranteed return on rate base, just like a city utility would back to the general fund, if that's what they were looking at. So the more money they spend, regardless of how that money is spent, the more money they get in return on rate base. It's just that simple.

Now, is that, is that treated like a base, a base rate in the water sewer, or is that still, um, volumetric?

It's-

Like, is this a piece of the per kilowatt hour-

It's-

- or is it fixed?

It's both. It's both.

Okay.

Yeah, uh, the DCTRF, uh, that they have, which is basically, that's the floating number that gets to float up and down based on what they need to return. Um, you know, they, they get to adjust that twice a year now, instead of once a year. Uh, and then that base rate adjustment or the adjustment, uh, to the minimum charge, uh, is, is basically the same, right? Uh, now, if you don't... It's not the same as water, where you're gonna get hit with sixty bucks or thirty bucks, no matter what, whether you use a drop or not. That minimum charge is you actually have to utilize the electricity in that month. So if you shut the property down, there's no line charge. Um, so it, it is, it is a little different. But here's the deal. Let's say you want to go work the system in Texas, because Texas buys electricity based on heat rate. We do not buy electricity based on capacity. So what does that mean? That means that when you go buy a plan, a guaranteed plan, they are gonna go buy a hedge for power from a specific power provider. It could be a mix of wind, solar, gas, but they're gonna go buy a base load of energy to pay for the amount of electricity that you're gonna use at certain periods of time. At the same time, y- you're gonna feel that increase in cost and power in future rate adjustments that come forward, right, in your electricity charges. In other states-- So what does that do? Uh, let me, let me stop there, sorry. So what does that do? That encourages companies to not invest in generation. So our system is set up to not invest in power generation, because if they invest in power generation, what does that mean? It means that they get to charge rates that are less. There's more power on the market, there's more competition on the market, and the cost of power goes down, right? So in other states, there's a pay... It's, it's kinda like, uh, for m- for our city folks, this is kinda like the difference between paying for water per thousand gallons and paying for water under, like, a take or pay contract, right? Like, you're gonna pay for a million gallons a day, whether you use it or not.... um, it's, it's sometimes can be more sustainable, 'cause you can build the infrastructure necessary to handle peaks better in that instance. In the electricity side, we don't handle peaks very well in Texas, because we don't buy, uh, we don't buy our electricity based on a future need, we buy our electricity based on what the need is today, or on a projected heat rate need, uh, on the day, the minute, and the hour. So there's this whole built-in market from electric generators that I wouldn't say the word purposeful, but are close, where they hold back as much energy as possible to keep rates as high as possible. 'Cause I don't know if you've paid attention to natural gas, but it's really cheap right now. Um, yet if you look at power generated by natural gas plants, it doesn't, it, it doesn't, uh, correspond with the price of gas like it used to, because demand has gone so high. Um, so there's been a couple of things that have happened there. Now, battery backup generation in Texas has come in very strong to kind of help out with that as well. Um, but those battery backup generators are also doing the same thing. They're pulling electricity off the market, and they're waiting for a peak. They're waiting for that heat rate to get as high as possible, and then they're releasing that energy to the market to get paid at the highest rate possible. Um, which obviously creates some market instability, and creates higher rates in the electricity rate that people pay. So we're, we're getting hit with, like, this da- double whammy in Texas right now, and energy is becoming, I wouldn't say unaffordable, but it's continuing to become, get closer to the point of unaffordable.

I can tell you, my electricity bill in the summer is almost as much as my mortgage.

Yeah, so mine was... My highest one this, uh, this go was $800, and prior to Uri, I went and looked, I never had a bill over 440, right? So been very s- I, I mean, that- that's kind of what got me digging into this, right? And then I started digging into, okay, if I built a battery backup system on my house, and I put solar on my house, and I started to, like, invest in all these things where I could sell electricity back to the market, that's also a problem. Because I can't, um... Go, go look at a net metering and on power to choose, and look at the rates go up four to five percent. So if you create a plan, even if you're gonna use 1,000 kilowatt hours a month, and then you say, "But I'm gonna have net metering, and so I'm gonna put in place the ability to sell back to the market," the energy rate- you, by the way, you don't get the line rate back, you just get the energy rate back. Um, you know, you're, you're putting that into the market at the lowest cost possible. You don't get the benefit of the heat rate that's there. So there's a big movement, and this is really where I wanted to get this entire conversation. There's a company out there that will come and install batteries on the side of your house, and you don't really pay for the battery. They basically just come and install it on the side of their house, and they create this grouping of batteries within a specific market area, right? And then they use your house as the ability to buy and sell electricity into that battery, right? And so, and there's not really a benefit for you other than the fact of if you lose power on your house, that backup battery can be used for the power, and it's sold to you at the same rate as your electricity cost is, right? They basically are a REIT, uh, a retail electric provider, and they are, uh... I'm sorry, REP, I said REIT. Uh, REP, um, and they basically put these batteries. So you go sign up with them, they sell you electricity, and they put these batteries on your house, and then they utilize those batteries to buy and sell into the market at any given time. Question is, there's a big movement now to allow co-ops to occur. So for folks to be able to go create a co-op and do the same thing on their own. So create, like, a residential co-op, put these batteries on the side of your house, and be able to buy and sell into the market, so that, uh, retail residential rate payers can have better control over their capacity. And also the ability for those co-ops to buy into the power generation, so that they can start to buy the, the demand needs and not necessarily the hour of power usage. They can buy the capacity. So I bring this up, 'cause I just don't think we talk about it enough, um, and I think it's something that we need to talk about more, and I think it's something the state needs to fix. Um, I, I had a conversation with a state senator who sits on this committee, and I started asking some questions, and the, the level of non-answer that I got to the questions that I was asking told me everything. Uh, that they know there are serious problems here, and they don't really know what solutions are. Uh, and we've got to find some solutions, and we've got to fix how the electric market in Texas works. I think this is one of the largest dangers we have to what we call the Texas miracle. Um, I think we're gonna be in a position where our electricity costs are rising at a rate that is so fast. We've talked about homeowners insurance in Texas. I think politically, electric rates and homeowners insurance are the two things that are going to significantly impact our politics in the state of Texas.

This is gonna be a stupid question.

Yeah.

The delivery market for power, there are cities who have municipal power companies, but it's not really feasible to say we can only have, like, we can only have municipal electric companies, right? In, in rural areas, you don't even have water and sewer, 'cause you're just on wells and septic, right? So, like, you're not even have to worry about that.

Right.

They don't have the capacity to provide power in that scenario.

Yep.

So when it comes to, like, the last mile, I don't think you're gonna have an option but to have private providers. But if the generation is part of the problem, is there a scenario where-... having like basically bringing the power generation under the state, a viable way to keep there, to, to prevent this problem where we're only generating like a just-in-time amount to keep prices as high as possible?

Oh, I don't think it's that. I think it's, uh, I think it's actually opening-

And I'm not saying I agree with that, obviously-

Yeah

... 'cause generally I would not like to have the state run as much as possible.

Oh, I, I, uh-

I'm just asking the question.

I, I, I think that's a... The, the answer to that is unequivocally no. Like, that's not... We would never want that to occur. I think opening up the free market on electricity even more, and I think creating and removing the rules for residential taxpayers, um-- or sorry, residential homeowners and, you know, commercial, uh, clients that are below the demand threshold right now. Right, right now, if you don't, if your demand is not over a certain megawatt per year, there are certain things that you don't qualify in the electricity market. The biggest one is the turn-off incentives. So let's say you're a big data center, and the state needs to conserve energy and power. They get paid, like, legitimately, they get paid real dollars, like big sums of money, to turn off in that peaking market. Why can't we pay...? We have... And, and the reason they say that they can't do this is because we don't have the metering technology. This is like 15 years ago when they put this in place. We don't have the metering technology to do it, but why can't I, as a, as a household, not register with the state and say: "Hey, you, I have backup generation at my house, so you can cut my power off and pay me to get off of it"? Why can I not get the same benefit as somebody else? And we could shed a ton of load from the system and be significantly more sustainable at that point. Um, I mean, you're in the same boat I am. You know, our, our whole home generators can run for... I mean, mine, mine can go for, like, five days. I think yours can probably go for, like, 15.

No. Um, it depends on what I turn off.

Yeah.

But I can probably go three to four days, for sure.

Okay. What, what size, uh, tank did you put in?

I, I have a 250.

Okay, so do I. Okay.

Yeah. I wanted a 500, but they just... It was, it was, like, an eight-month lead time, so.

Yeah. Yeah. So I, I think, I think that's an interesting, um... I think that's an interesting take on it, but, like, if you wanted to take me off from 6:00 pm, uh, to 9:00 pm, which is, uh, the major issue in the Texas grid right now, that's, that's it, right? 'Cause it's, it's when the wind slows down and when the sun goes down. Uh, that's the, the grid problems that's there. You can read all about that, but that's, that's really the prime time. So if they would say to me, "Hey, we're gonna pay you to go off grid," and they would just automate that process, that would be easy for me. Um, but you could opt into that. You could opt into these co-ops. If we could democratise that process a little bit more, if we could open up that free market a little bit more and take away these restrictions that are there, I think we could, we could have some pretty serious changes to the electricity system, and you could have some pretty serious savings to residential tax, uh, residential ratepayers because the system is really set up for the big corporate guys right now. It's set up for the New York Hedge Fund. I mean, people talk about Uri, and they talk about the hedge funds that made all that money and the, the evil empires that are there and all that other type of stuff, right? But honestly, good truth, they are the ones who made all the money. The guys that were hedging the heat rate were the ones that made all the money. Just is what it is. Um, so I, I think we could be smarter in this, and there are companies out there that, like... I, I'm an Energy Ogre customer, right? I pay them $100 a year to basically watch my energy rates and go through everything, and they save me well north of $100 a year, uh, based on what they negotiate. There would be plenty of market for a company like that to get involved in some type of large-scale residential cooperative, either generation agreements or, um, or, you know, uh, turn-off agreements in order to handle and, and make the grid more sustainable. I just don't think we're being creative enough, I guess, is my... Yeah.

So as someone who has very little in the knowledge of how that stuff all works, I have two more questions for you.

Yep.

Would adding nuclear capacity not help lower those costs for generation-

It, it would

... while providing a stable base and then, and, and allowing for that system not to be gained as much?

No doubt. No doubt that it would. Um, the problem is, is that Texas pays for electricity at the point of purchase. So because we don't pay for capacity, it's very difficult for nuclear to come online in our system, and I want to say it like George W, nuclear.

Nuclear.

Nuclear. Um, but if, if we were paying for a base load capacity, which is the other conversation that a lot of people are having, is that we probably need to have, uh... Like, in the legislation that they put in place, they have peaking capacity. So they're, uh, paying companies to go out and build peaking plants, like small, uh, electric generation plants that are, um, you know, like little gas-fired plant generators that, you know, will do like 10 megawatts here and there all over the state, and that way, if we need it, they can just peak up, right? The reality is, we probably should go and say, we should create almost like a Texas Water Development Board funding stream, like a revolving state fund, to go and build capacity. So to basically guarantee, like, if you go build- I mean, 'cause C- like, Comanche Peak doesn't use all of their capacity out of their, uh, facility. In fact, they have a Bitcoin mining company that's located right outside of the plant, right? And the reason they're located right outside of the plant is because-... the electricity is cheap, and Comanche Peak has to be, um, they have to have a sustainable load in order to make it worthwhile to run nuclear power. 'Cause once you start the nuclear process, right?

Yeah, you're not turning it off.

You're not turning it off.

Yeah.

So, um, I think from a state standpoint, that would be one of those things where it's like, "Hey, we need to go fund, um, you know, a, a $50 billion nuclear facility," or whatever it is, "and we need to make our grid more sustainable. Um, and we need to do whatever's necessary to have a revolving fund to make sure that we have this amount of load on the system at any given time." Um, and I, I think that's the difficulty that, that we all face, is the Texas system is set up differently, uh, than many other states. Even states that have a separation between line and retail, uh, Texas is still set up differently than those other states.

Okay, question number two.

Mm-hmm.

If CenterPoint Encore are investing, and I use air quotes with that, in the infrastructure in order to justify these rate increases, right? Whether or not those investments are efficient or ideal-

Mm-hmm

... why couldn't the state use some of its surplus to fund those investment, like specific investment proj- or, uh, infrastructure projects that would make the system more resilient to avoid those rate increases?

I think it's very difficult to do that because these are not state-owned entities. These are publicly traded corporations.

Mm-hmm.

So when Texas, when-

But they're heavily reg- or they're, I mean, they're relatively heavily, heavily regulated as utilities.

But it's like the railroads on the Monopoly board. Yeah, they're regulated until they control everything. They got all four railroads, man, light company and water works. Like, the level of lobbying that they put in Austin and the things that they get written in the bills, um, I would have a very difficult time trying to tell people that it was what is best for the Texas ratepayer. And I'm not saying that we need, like, a government takeover of the line companies. That's, that's not it at all. Um, but what I am saying is, is that we couldn't put public funds into these companies and justify that, in my opinion, just because you'd basically be... What we need to do is, is we need to go back in, and we need to adjust at the PUC their calculations for return on investment and return to rate base. That's where we need to go in there. 'Cause there are really goofy things in that that I still haven't gotten answers to. Had a really good phone call last week with a guy who's super knowledgeable, and he hasn't gotten answers to this. But for example, when a developer builds out a neighborhood and gives them half a million dollars to build out the electricity infrastructure in that area, that half a million dollars goes into rate base, and they get a return on money that they never spent, we believe, and nobody has been able to answer that question. I mean, anybody who works on water rates understands, like, how those rate modeling make, uh, works. That doesn't make any sense. Developer contribution should not be something that we get a return on rate base on. Um, but in the electricity side, I believe that they've negotiated that in. So even when they don't spend money, they're still making a return on money they don't spend. Uh, so I- it's complicated, and you're not gonna blow it all up at once, but I would just like to see some ability to, to put consumers in the driver's seat.

Mm-hmm. Final question.

Yep.

Going back to the last topic, wouldn't all of this distribution infrastructure be a lot cheaper if we built differently?

It would be.

Okay.

Yeah.

That's all.

And, and, and that's also what they use as the justification for it, by the way, for the rate increases. It's always in their memos. It's always in their proposals.

Oh, you guys are sprawling.

Yes, correct.

It's expensive. Well, it is.

Yeah, and it, it... 100%. Sprawl is a lot more expensive than we realize. It just hits us differently. All right, two, two things. Quick, quick two topics. One, lightning round questions. At two o'clock today, the Fed will increase... or, sorry, decrease the rates. Will it be a quarter point or a half point?

So they do a quarter point, and it turns out not to be enough. That's a problem.

Mm-hmm.

They do a half point. Does it signal s- more severe distress than what they think is, is in place? I don't know. I, I'm gonna s- stay conservative and just say 25 basis points.

I'm going half a point.

Yeah, all right.

I, I think the jobs numbers specifically, and you actually brought this up, to be fair, um, but I think the revisions of the previous job numbers-

Mm-hmm, were bad

... were bad, and I think they, they really justify... I think the Fed... I listened to a couple interviews of, like, Fed chairs from different regions, and I think the Fed is very focused on the job, the softening of the job market.

Mm-hmm.

So-

More so than the inflation slightly starting to tick back up?

Well, and I mean, uh, technically, the inflation-

It's still under 3%, right?

Still under- it's still under 3%. It's in the twos. That's a really healthy range to be in. Um, and yeah, I think, I think the danger here is, is the job market. Um, and so I think that's what they're gonna be really concerned about. So I think it's a half point, but we'll see. Either way, we're gonna have multiple rate cuts before the end of the year, in my opinion. So this will not be-

So I think so, too, but that's, that's kind of why I'm leaning more towards the quarter.

Yeah. Um, I think the Fed's goal is by mid-2025 is to have the Fed funds rate somewhere in, like, the mid threes. Um, and that's gonna be a lot of rate cutting to get there.

Is that about half what it is now?

Uh, we're 5.3 right now, technically.

Okay, a little, little less than half.

Yeah. We're- the benchmark rate is, like, somewhere between 5.25 and five and a half, right? So, um, that's, that's technically what they do, is they just give you a range for the benchmark.... so if they do a quarter point, it's gonna be five to 5.25, and if they do a half point, it's gonna be 4.75 to five, right? Uh, so that's, that's how you're gonna know, uh, what it is there. So yeah, gonna be real interesting to see what they cut, and where they cut to. Uh, last question, sent you a video last night of a fan on the news saying that Texas was gonna go undefeated. Will you echo his projection? Will the University of Texas football team be undefeated this season?

Will the number one University of Texas football team go undefeated? So here's, um... I'm not gonna make that prediction, even though we are favored in every game remaining on the schedule. Um, what I wanna- I, I, I'm just going to assume-

So that's a no-

... that we'll drop one somewhere.

That's a no?

I'm, I'm not gonna, at this point, make that leap-

If you-

-and say, "Yeah, we're going undefeated." Um-

And if you drop one, where is the most likely scenario to drop that game?

It's gonna be between... It's gonna be mid-October. It's gonna be OU, even though they're not that good, or, uh, Georgia.

It-

'Cause Georgia's the week after.

It's not gonna be College Station.

Right, so so you- I wanna just pr- uh, put some more context around this, right? You sent this video, which, by the way, I couldn't hear it-

Yeah, it's my TV.

I couldn't see it.

Did you see my feet in the bed?

You have to- you have to take video in landscape. Don't take video in portrait mode.

This is my Chad's pet peeve.

It shouldn't even be allowed to happen.

This is like pie charts, people. Just don't use them.

Your eyes work in a specific way, horizontally, right? You have a much broader field of vision horizontally than vertically, okay? You can't see as much in a video when it is portrait mode. So you're taking a video of your television, which by the way, is landscape, and you're taking this video in portrait mode. So what I can see is this tiny little rectangle that's taking up about 30%, maybe, of the screen right in the middle. I can't see what's happening. And then al- also, the audio is extremely low, so I can barely hear it. But you send this in our little group chat-

Uh-huh

... and you say, "Lol, TU fans." Would you, would you like to explain-

Uh

... what came next?

Uh, I don't, I don't know what you said next. I didn't pay attention to it. I usually just turn off after I send you things like that, especially late at night.

I sent you a picture of-

Oh yeah, the Jimbo Fisher

... an iconic picture of the Jimbo Fisher, head football coach, Texas A&M University, 20 dash dash NCAA Division I football National Championship trophy.

Gotcha.

So confident were you that Jimbo was gonna take you finally to the Promised Land, that you gave him a championship trophy.

Yeah.

And you want to criticize a Texas fan for being optimistic about his number one team in the country? Talk less, uh-

By the way-

Talk less, Chad

... the Florida, Florida fan, the Florida State fan is still not eating crap, by the way.

He has not eaten the poop yet.

He has not eaten the poop yet.

The world is not gonna come... This is one of those moments, I think, where, like, the world's, uh, shift off into tangent universes.

Yes.

Like, if you're familiar with Donnie Darko?

Yes.

So one of those occurrences was when Steve Harvey announced the wrong winner for Miss America.

Yes, I remember.

I- is that, is that what it was? I know they did the same thing with the Oscars. They, they rent-

Yeah

... like, Warren Beatty read the wrong card. Um, so like, I think both of those events, like, skewed us into a tangent universe. And I think that this also could be one of those scenarios, where the, the Flo- uh, for those who aren't familiar, there was a Florida State fan on Twitter. Which game was it? Was it the second game-

It was the-

... or was it the Georgia Tech game?

It was... No, it was the second. It was the, it was after the first game, I think. He came on there and said-

So they go, they go to Ireland-

Yeah

... they lose to Georgia Tech.

Yes.

Who- what was their second game?

Uh, it was, uh, was it Memphis? No. Who was it?

I'm gonna pull up their calendar here.

It was a mid-major, right?

Full schedule, ESPN. No, it was Boston College, who's actually-

Pretty good

... not terrible.

Yeah, pretty good.

Is Bill O'Brien out there now? So a Florida State fan goes on Twitter and says, "If we lose to Boston College, I will eat crap out of a red Solo cup." Okay?

Yeah.

This game ends, Florida State loses 28-13. He turns off his Twitter account.

Mm-hmm.

Off the grid. Like, you make this bold claim- ... you gotta own it. I'm sorry, I'm not the one who-

Mm

... made this promise.

Yeah.

So, uh, even, even the Florida State Barstool accounts are saying, "Come on, dude." "You, you gotta do it, otherwise, like, the world's never gonna be turned back-

It's like the curse-

... onto its normal axis"

... cursing the goat right here.

So, um, so yeah. Anyway, uh, I- I'm not gonna go so far as to, uh, to make the claim that we're gonna go undefeated. I think that there's a very real likelihood we could drop one. Um, but I, I have told my son that if we end up in Atlanta, we are gonna go to the game.

Okay.

I, I really wanna go to the Georgia game, I just can't, 'cause like, birthdays and conferences and stuff are kind of all coalescing in that two-week period. So-

Yeah

... that would be my preferred option, but if we can't do that, then we'll see Georgia again in, in, in Atlanta.

You're in a happy space right now. Just everybody, all the listeners, understand, the minute Texas loses this year, we will have an emergency podcast so you can get direct reaction of Chad's loss.

No, I mean, I'm in a much better place. You have to understand what we went through-... during the Charlie Strong era?

It's what every Texas fan says.

I mean-

Charlie Strong was not that bad of a guy.

No, well, I didn't say he was a bad guy. In fact, when he was fired, I said very much that, like-

Yeah

... it's unfortunate. Like, he seems like a good guy. It's unfortunate that this didn't work out for him. He was not a good football coach at Texas. Um, we went- we went from, like, 10 years of 10-win seasons, national championships, you know, like, high-level recruiting and play, to 10 years, like, basically where A&M has been for the majority of its existence.

Wow!

Like-

And-

... getting that experience-

Uh

... I mean, it gives me a newfound perspective for your life as an Aggie fan. But yeah, I mean, d- do you know how many years it's been since y'all have been ranked number one?

We're back in the top 25 now, Chad. Okay? We're 25.

Congratulations. You beat, uh, absolute dog crap Florida team. Uh, I think you got a better quarterback now, though.

I do, yeah.

Um-

Marcel Reed's better. But-

Yeah

... that was the longest lightning round of all time, so we're gonna end it there.

Especially with only, like, two questions.

Exactly. That's all I had. Uh, so yeah, very informative podcast there, Chad.

I, I'll let the listeners be the judge of that. Um-

We got, we got a good one coming up, though.

One... Yeah, quick announcement. No spoilers, but on the next episode of ZacCast, uh, a very special guest. So, uh, Patrick, why don't you go have a, a good rest of your day.

Yeah, I got a couple meetings coming up, gotta talk through some development agreements with a few of our clients. Uh, it's my afternoon, and, uh, gotta figure out what I'm gonna have for lunch today. I haven't eat-

I'm having taco seasoned salmon, ready-made meal from, uh, from H-E-B.

Yeah. Dude, I actually do love the ready-made meals from H-E-B.

Yeah.

They're very tasty. So, um-

I'm a little bit nervous about this one, 'cause it could be disgusting, but-

It, it could be. It could be.

I wanted to try it.

Yeah. So, well, you know, um, taco seasoning on salmon?

Mm-hmm.

Okay. What's the side?

I don't remember.

Okay.

I bought it on, uh... over the weekend.

Okay. So, nice.

No, I didn't. I bought it Monday when I got my new, my new laptop.

Oh.

My laptop screen died.

Yeah.

Just went kaput.

Still doesn't have the eye thingy-ma-jigger from Apple, though. What is that thing called?

The what?

What, what, what is the, what is the 3D, 4D reality gla- glasses, goggles? The Oculus thing.

Oh, the Vision Pro?

Vision Pro, yeah.

Oh, no Vision Pros yet. They're still too expensive.

Yeah. They are. You think they'll come down?

I really want one just for fun. I don't know, the adoption has not been very good, so-

Yeah, maybe a decade.

I assume they'll keep iterating on it. They, like... They have enough money that they can go through a couple of product cycles before they really figure it out. But I, I still don't think that the, like, the wearable goggle thing is gonna take off until it's as small as, like, glasses.

Yeah. Yeah.

If you could just wear basically just, like, sunglasses or regular glasses instead of this huge, like, 10-pound computer on your head, then I think it would take off.

Nice. Well, that's all I got for you folks, so we're gonna wrap it up there. We'll see you here in a couple weeks on the next episode of ZacCast. Bye, Chad.

Bye, Patrick.