Attacks on responsible governance and economic freedom are gaining momentum in Texas, while existing anti-environmental, social and governance state laws "carry real operational and economic consequences," according to Houston Controller Chris Hollins.
Speaking at The Bond Buyer's Texas Public Finance Conference last week, Hollins criticized two 2021 Texas laws
"These laws restrict our ability to work with the most-qualified and capable firms, increasing costs and limiting the tools that we have to serve our taxpayers effectively," he said. "It isn't just bad policy, it's bad business, and what we're witnessing today is an expansion of that trend."
Hollins, who won a December 2023 runoff election for controller and took office in January 2024, said oil and gas are critical to the economy of the nation's fourth-largest city and that production demand is expected to increase over the next decades.
"So what are they actually protecting? The answer is, nothing," he said. "What they're doing is attempting to stifle innovation in ways that hurt America only to get a few more likes on Truth Social."
Hollins also condemned attacks on diversity, equity, and inclusion, saying while the most-qualified people should be sought, systemic inequality should not be ignored.
"You should not feel threatened for wanting to reflect the communities that you serve, but you're being threatened and all of society is watching to see which one of you will stand up for your values and for what is right, and to see which one of you will fold in a misguided attempt at self-preservation," he said.
As for Houston's fiscal situation, Hollins said his office's watchdog role is to ensure taxpayer money is being spent wisely and effectively. With
The city's projected ending budget
Shrinking reserves were a major factor Fitch Ratings and S&P Global Ratings cited when they revised their outlooks on Houston's AA ratings
Houston could get a financial boost under
Hollins railed against the potential elimination in the Republican-controlled U.S. Congress of tax exemption for municipal bonds, saying it would drive up the city's borrowing costs 15% to 20% "at a time when one out of six general fund dollars already goes to debt service," leaving less money to pay for critical services.
"This is coming from the same party that claims to be fiscally conservative," he said. "It's coming from the same party that says that we want to save taxpayer money. But these actions tell a completely different story, undermining efforts at a fair shot for all, driving up the cost of city projects, abandoning free market principles, and threatening to gut one of the most critical financing tools available to state and local governments."
Houston is plowing ahead with bond deals. Compliance with a federal consent decree involving the city's wastewater system will cost $9 billion or more, according to Hollins.
"Our combined utility system will be going to market with an issuance in Q3 of this year to start putting a dent in the necessary work under the consent decree, but also to address deferred maintenance at the northeast water plant and installing manhole monitors that will allow the city to respond to disruptions in the future more effectively and more quickly," he said.
Debt issuance for the city's airports is on tap for this year, along with a current refunding in the fall to
