Monday, August 31, 2009
Baker and Lloyd teamed up to flip the Foster Ranch in a property deal that included California developer Makar Properties and an illegal development agreement with the City of Dripping Springs
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By Charles O'Dell, Ph.D.
Texas is billed as a property rights state, but in reality it’s just a Property Rights Casino that pits the public against a few high rollers. The game is run by government officials and everyone is encouraged to play, but Casino rules protect the high rollers and the regulatory deck is stacked against the little guy.
Those high rollers are the Casino’s closed door patrons who contribute big bucks so state legislators will enact special game rules and local elected officials will sweeten the development pot. The Texas Commission on Environmental Quality (TCEQ) works as the Casino dealer, and when necessary deals from the bottom of the regulatory deck.
Few players realize the property rights game in Texas is rigged, and most don’t pay attention until their property rights are being threatened by eminent domain taking, development that pollutes their property and leads to dry wells, excessive taxation, or when the high rollers falsely characterize improved development regulations as an attack on everyone’s property rights.
Nothing stirs visceral reaction in the rank and file like a public call to defend property rights, and elected officials frequently use that emotional button to protect the high rollers. But to paraphrase Pogo, some property rights are more equal than others.
Perhaps a real life example will demonstrate how, with help from public officials, the property rights game is stacked against the typical property owner. Dripping Springs attorney Rex Baker and Austin based developer John Lloyd are two local high roller property rights players. In 2000, Baker was City Attorney for Dripping Springs, Hays County Pct. 4 Justice of the Peace and estate attorney for a family who owned the 1,600 acre Foster Ranch located at Hwy 290 and Nutty Brown Road.
Baker and Lloyd teamed up to flip the Foster Ranch in a property deal that included California developer Makar Properties and an illegal development agreement with the City of Dripping Springs. Yes, Baker was City Attorney and knew the agreement was illegal, but Baker and his title company stood to receive more than a quarter million dollars from the transaction, and Lloyd a half million dollars for bringing Makar Properties to the table.
A group of local citizens knew this agreement was illegal, formed the Friendship Alliance and sued Dripping Springs Mayor Todd Purcell. Baker went to Rep. Patrick Rose and a bill was passed in the state legislature making the agreement retroactively legal. Another big property rights win for the high rollers thanks to public officials changing the rules.
The illegal agreement now made legal by friendly officials brought high density residential and commercial development over the headwaters of Bear Creek in the form of Belterra, and Joe Beal’s LCRA brought them surface water to complement Belterra’s two deep wells. Makar Properties had agreed to use subsurface drip irrigation for disposal of its treated wastewater, but in 2005 the Belterra utility district quietly filed a permit amendment application to discharge daily a million gallons of treated wastewater directly into Bear Creek, freeing up acres of drip irrigation fields for more homes.
Downstream property owners appealed to TCEQ to protect their properties from the increased pollution threat, and presented strong scientific evidence with expert testimony demonstrating how their property rights would be violated if Belterra switched from its originally agreed subsurface drip irrigation to direct discharge and polluting Bear Creek even more.
TCEQ gave Belterra the first direct discharge permit in the Hill Country and downstream property owners have filed suit in District Court seeking property rights protection denied them by TCEQ. Belterra is an example of some property rights being more equal than others, and TCEQ dealing from the bottom of the regulatory deck.
John Lloyd went on to develop his Rim Rock subdivision near the Salt Lick and has teamed up once again with Rex Baker and the City of Dripping Springs with the Halls Residential Development Agreement (which includes 25 acres of commercial development across from a nearby elementary school).
This development is also next to the new Harrison Ranch Park that the City of Dripping Springs purchased in 2008 using $775,000 from Hays County parks and open space bond money. City officials presented false and misleading information and made empty promises in convincing commissioners’ court to give them the bond money. Harrison Ranch Park and a Development Agreement loaded with City ordinance variances certainly sweeten the development pot for high rollers Lloyd and Baker.
The list of Texas Property Rights Casino high rollers and their official sponsors is long. They include politically well connected and water wasteful Aqua Texas; Commissioner Will Conley’s True Ranch; and the expensive special interest public financed projects of Commissioner Jeff Barton who is also an active partner of Ducet & Associates.
Welcome to the Texas Property Rights Casino where some property rights are more equal than others.
1. You can share the legal costs of defending property rights against the Belterra direct discharge permit action by sending a tax deductible contribution to SBCA, PO Box 5923, Austin, TX 78763-5923. Indicate that your contribution is for the legal fight against the Belterra violation of property rights.
Posted by RoundUp Editor at 1:40 PM