After months of internal discussion, unbeknownst to the public, the City of Sugar Land formally tendered its resignation from the Texas Energy Center in November.
| Texas Energy Center – Final Part Of A Series |
| The Series: |
| Part 1 → Economic Engine Or Empty Promise? Part 2 → Ambitions Outpaced Its Pocketbook → Born Amid A Heap Of Hype Part 3 → Who Really Landed The Jobs? Part 4 → Sugar Land Quits TEC, Comes Back In 2 Weeks |
For two weeks.
Then, after a Nov. 29, 2006, meeting with Greater Fort Bend Economic Development Council officials who also manage the energy center, Sugar Land Mayor David Wallace had a change of heart and wrote a letter withdrawing that resignation.
The city’s exit and re-entry – and the debate that led up to it – illustrate the uncertain future that the energy center faces.
On one hand, the TEC has provided a host facility for Research Partnership to Secure Energy for America, a non-profit consortium that signed a contract last week to manage a 10-year, $375 million energy research program for the U.S. Department of Energy. That contract represents an economic plum that its board members have sought since the TEC’s inception.
On the other hand, none of the TEC’s other energy initiatives have born fruit. Now operating without a staff, its income is limited to the interest payments it draws from about $1.7 million left from a state grant, and it has no identified source of continued funding. Yet it faces contractual obligations to create new high-paying jobs for the state of Texas, for the next nine years.
In spite of those difficulties, the energy center has strong supporters. One is Fort Bend County Judge Bob Hebert, who said recently he believes the TEC has achieved success in the face of financial constraints that were out of its control.
“It’s like any other innovative approach,” Hebert said of the energy center. “It very seldom has the shape and size coming out” that was envisioned in the beginning. “I’m pleased with where they are right now. I tip my hat to them.”
Fort Bend County is one of five TEC board members. The others include the Greater Fort Bend EDC, the Gas Technology Institute, the University of Houston and the City of Sugar Land.
The university is pleased because of the RPSEA contract. UH not only has a founding member of the TEC, but of RPSEA as well. And while university officials haven’t figured out exactly how to get it, the expectation is that some of the research contracts RPSEA manages will flow to UH, said John Warren Jr., director of the university’s Office of Intellectual Property Management and its representative on the TEC board.
Warren also said discussions are continuing over how to take maximum advantage of the fact that RPSEA will be managing research while UH is building a new campus in Sugar Land where research facilities could be located.
Ongoing Vacuum
Meanwhile, the City of Sugar Land also is excited over RPSEA’s prospects and what it may mean for the region. Unlike the county, however, the city doesn’t appear to be content with the TEC’s current status. For months, according to letters, emails and other documents obtained in a Texas Public Information Act request, city officials and staff members have debated over the future of the TEC – and whether the city will share it.
“As I sat through the TEC board meeting yesterday I was struck by the ongoing vacuum and lack of specific direction,” one staff member wrote in a March 2006 memo to City Manager Allen Bogard. “As there does not seem to be a way to extricate ourselves from the TEC it must then be our goal to find a focus for the TEC that will allow it to be successful rather than a potential detriment.”
City officials have discussed various courses of action for the energy center, including creating a “TEC Jobs Grant” that would provide up to $1,000 apiece for new energy industry jobs created in Texas.
They also talked about actions they wanted to see ended at the TEC, including its role as a landlord at Sugar Land’s Kensington II building, where the TEC moved in 2004 when its primary focus appeared to be in serving as a business incubator.
Whether pressed by the city or acting on its own volition, it appears the TEC has significantly pulled back from its landlord role. Documents show it rented 43,000 square feet of space in early 2004, then cut that back to 21,000, then to about 16,000 and last year, to less than 13,000 square feet.
Jeff Wiley, EDC president and also acting in a contract role as TEC executive director, said beginning in 2007 the center will be sharing about 4,500 square feet of space with RPSEA, the non-profit consortium. He also said the TEC will sublease that space from WOW Energy Inc., a renewable energy technology firm that had been a tenant of the TEC.
Hiring Lobbyists
One proposal that turned into a directive was to hire a new EDC employee who would perform all the duties necessary to satisfy contractual state grant requirements for creating new jobs. In the process, Wiley could back away from his contractor duties, for which the TEC is paying the EDC $10,000 a month.
“I had literally pushed to have the TEC to contract with the EDC for an individual,” Bogard said. “And that would be my personal preference. I think it would work better as part of the EDC. They could probably come out ahead financially.”
Although the TEC board apparently agreed to the idea last summer, no employee has been hired.
But a new lobbyist has.
Barry Williamson already has been working for TEC as a lobbyist since at least 2004 (a line item in board financial statements refers to him as a consultant). For 2006, Wiley said, he was paid at the rate of $5,000 a month. A former energy secretary adviser under President Reagan and the U.S. Interior Department’s director of minerals management service under President George H.W. Bush, Williamson was Texas railroad commissioner from 1993-’95.
And in September 2006, the TEC hired Debra Whiddon, a lobbyist since 2001 for companies including Reliant Energy, and a personal friend of U.S. Rep. Joe Barton, ranking minority member on the House Energy and Commerce Committee. She also is being paid at the rate of $5,000 a month.
“Debra has been focused on national issues,” Wiley said. “We just thought she was the right person for us.”
Bogard said he was aware the center has “one or more lobbyists,” but added he isn’t up to date on specific details such as Whiddon’s hiring, adding, “We haven’t had a board meeting since August.”
It’s unclear what activities Williamson and Whiddon perform for the energy center. Whiddon apparently is lobbying in Washington D.C., but TEC officials didn’t provide many details beyond that. Hebert indicated the lack of details may be on purpose, as the TEC pursues funding opportunities that may attract competitors.
“They’re planning several strategies,” he said. “I think their focus is both state and federal. It’s completely competitive,” and so it’s unlikely TEC or EDC members would feel comfortable revealing their strategy.
As for Williamson, he has reported to the board that he believes the TEC could be positioned to receive line-item funding in the state budget.
“There have been those discussions, but there has been no decision to pursue that at this point,” Bogard said. “We have a job commitment. My personal opinion is that it would be better” to stay focused on that commitment.
Breaking Up Is Hard To Do
By last fall, RPSEA had been named as the DOE’s pick to manage its energy research program, and insiders believed signing of the contract would occur fairly soon.
Citing that as the City of Sugar Land’s main objective when it joined the TEC in 2003, Mayor Wallace said in his resignation letter the goal has been attained.
“As we discussed last spring, when the City’s original objectives were achieved the City would separate itself from the TEC so that it may continue to evolve with private sector involvement…,” Wallace said in a Nov. 16, 2006, letter to EDC Chairman Bob Brown, who also holds the title of energy center chairman. “In order to create the greatest opportunity for change, we ask that you consider this letter as our resignation from the board of directors effective as of this date.”
But Brown was out of the country when Wallace went to the EDC’s offices to personally deliver the letter to him. So instead, the mayor “brought the letter in to me,” Wiley recalled.
After Brown got back to town, “there was a discussion between Jeff and Bob and the mayor and myself, where Bob was able to convince the mayor and I” not to leave the TEC, Bogard said.
“You would have to ask the city why they believe exiting the center is the right thing to do,” Wiley said. “It’s not helpful when you’re two to four weeks away from securing a lease with RPSEA. As to their rationale for staying or leaving…from my understanding they always supported the energy center. So the question becomes, are they more effective as a board leader or outside the board?”
Wallace provided an answer in another letter to Brown, this one on Nov. 30, 2006.
“Though we continue to believe that a change in leadership to a private-sector board is in the best long-term interest of the Texas Energy Center, we also realize that it may not be the time to initiate such a transformation,” Wallace’s letter says. “Therefore, in order to provide the Texas Energy Center with the greatest opportunity to succeed in attracting its current prospects, I would respectfully withdraw our request to remove the City of Sugar Land from the Texas Energy Center.”
After months of internal discussion, unbeknownst to the public, the City of Sugar Land formally tendered its resignation from the Texas Energy Center in November.
For two weeks.
Then, after a Nov. 29, 2006, meeting with Greater Fort Bend Economic Development Council officials who also manage the energy center, Sugar Land Mayor David Wallace had a change of heart and wrote a letter withdrawing that resignation.
The city’s exit and re-entry – and the debate that led up to it – illustrate the uncertain future that the energy center faces.
On one hand, the TEC has provided a host facility for Research Partnership to Secure Energy for America, a non-profit consortium that signed a contract last week to manage a 10-year, $375 million energy research program for the U.S. Department of Energy. That contract represents an economic plum that its board members have sought since the TEC’s inception.
On the other hand, none of the TEC’s other energy initiatives have born fruit. Now operating without a staff, its income is limited to the interest payments it draws from about $1.7 million left from a state grant, and it has no identified source of continued funding. Yet it faces contractual obligations to create new high-paying jobs for the state of Texas, for the next nine years.
In spite of those difficulties, the energy center has strong supporters. One is Fort Bend County Judge Bob Hebert, who said recently he believes the TEC has achieved success in the face of financial constraints that were out of its control.
“It’s like any other innovative approach,” Hebert said of the energy center. “It very seldom has the shape and size coming out” that was envisioned in the beginning. “I’m pleased with where they are right now. I tip my hat to them.”
