Image provided by: Texas A&M University
About The Battalion. (College Station, Tex.) 1893-current | View Entire Issue (April 5, 1990)
The Battalion STATE & LOCAL Thursday, April 5,1990 Financial study reveals failed real estate loans burden Texas economy DALLAS (AP) — Texas finan cial institutions are saddled with $43.6 billion worth of bad real es tate loans, almost half of it on un developed land, according to a state study released Wednesday. The study by the Finance Com mission of Texas, which regulates both banks and savings and loans, says $28.1 billion of those loans already have been foreclosed and are in the hands of the govern ment or lending institutions. The remaining $15.5 billion, or 35.6 percent, are non-per forming loans, that is three or more months past due, and can didates for foreclosure. “This survey is the result of a cooperative effort of various state and federal agencies to deter mine the extent of the Texas real roblem by various categories of oldings,” Chairman R. Dary Stone said. Stone said he did not expect the figure to grow significantly because of the inclusion of non- performing loans. “I think that’s the bulk of it,” he said. “It can grow, but it’s not going to double or be 50 percent again as much.” The estimate does not include loans held by out-of-state institu tions, an amount Stone estimated could increase the total between $10 billion and $18 billion. Bill Ferguson, an analyst who tracks the financial industry, esti mated the bad loans represent about 16 percent of all banking and thrift assets. “When you consider as a rule of thumb that (an institution) with more than 2.5 percent is in trouble or headed that way, I think this has significant implica tions for the short term economic outlook in Texas,” Ferguson said. “It still is not going to be good,” Ferguson said, “This property is going to have to be disposed of and returned to income-produc ing form.” According to the study, com piled from the June 30, 1989 re ports of federal and state agen cies as well as Texas institutions, $19.44 billion worth of the loans are on undeveloped land. Stone, president of Delphi- nance Development Co. in Dallas, said he was surprised at how many of the loans were backed by raw land. “There’s really a small amount “When you consider as a rule of thumb that (an institution) with more than 2.5 percent is in trouble or headed that way, I think this has significant implications for the short term economic outlook in Texas.” — Bill Ferguson, financial analyst of office buildings, hotels, com mercial properties, relative to the entire market,” Stone said. He said the survey also indi cates government agencies charged with selling some of the seized properties will have a hard time disposing of their holdings, especially because of the current lack of a market for raw land. Ferguson said the study indi cates “there’s still some significant hits to be taken. ... You have to conclude that the best use for some of that land is to hold the world together.” The best information available, according to Stone, indicated that distressed loans on developed real estate, or $24.12 billion, was 5.5 percent of the value of all de veloped land, or $436.07 billion. What do you think about B-CS? Survey to capture citizens’ views By PAM MOOMAN Of The Battalion Staff Employees of the Texas A&M Public Policy Resource Lab are conducting a phone survey of College Station residents until April 12 to find out what they think about the city. Peggy Calliham, public relations and market ing manager for College Station, said six years have passed since the last phone survey. “The intent is to find out how citizens perceive services from College Station,” Calliham said. “What are the good things? Why did (they) choose to live here?” City officials also are interested in how citizens feel about city employees — whether they view them as helpful and polite. “From the answers we get back, we hope to pinpoint some weaknesses,” Calliham said. Hopefully there will be positive responses, and the city can use them to market College Station to businesses and tourists, she said. “It’s a starting point for our annual planning process,” she said. The newly elected city council meets in June and decides how to prioritize spending time and money in the city, she said. The city already may have ideas of. the areas that need improvement, she said, but they don’t want to assume anything. The random telephone survey will sample 500 people, and a percentage of those will be stu dents, Calliham said. However, probably less than 50 percent of those surveyed will be stu dents. “You want a balance,” she said. The city doesn’t just want to survey registered voters and homeowners, but it also doesn’t want a disproportionate amount of students, she said. Calliham said the survey is confidential and callers never ask for names. The first question that is asked, however, is if the citizen lives in Col lege Station. If they say no, then the caller doesn’t proceed with the survey, she said. Those surveyed also must be 18 or older. Information obtained from this survey will be analyzed using statistical methods and broken down into demographics, which are characteris tics of the sample population such as sex, income and occupation. “It’ll give us some information to do our homework,” Calliham said. Survey results should take two to three weeks to analyze, she said. Calliham said she expects the report to be made public around mid-May. Although citizens might be annoyed when they are called and asked to give up 10 minutes of their time, Calliham said, she hopes they take time to participate in the survey. The Public Policy Resource Lab is an on-cam pus group that surveys public opinion. Speaker backs school finance reform bill AUSTIN (AP) — House Speaker Gib Lewis threw his weight behind a $450 million school finance reform bill Wednesday, as teachers warned schools may close unless lawmakers act quickly to meet a May 1 court deadline for change. “We’re on a fast track, and we are hoping to get everything solved as soon as we possibly can,” said Lewis, D-Fort Worth, who predicted House passage of the bill. “It’s a bill that I support,” Lewis told House members. He asked them not to amend the bill when it comes up for debate, planned for Monday. If the bill wins House approval, a conference committee could be ap pointed to work out differences be tween it and a Senate measure that would pump $1.2 billion more into public schools in 1990-91. Lawmakers are in a second special History has recorded Governor Clements as the first Republican governor in Texas since Reconstruction. If he shuts down our public schools ... I think it would be safe to predict that it may be many, many years before Texans will risk electing another Republican governor.” — Ollie Besteiro, president, Texas State Teachers Association session to address a Texas Supreme Court ruling that the school finance system is unconstitutional because of disparities in funding available to property-rich and -poor school dis tricts. If they don’t meet the deadline to reform the $13.5 billion-a-year sys tem — which relies on a combination jpreme of local property taxes, state aid and finance some federal funds — the court could freeze school funding, closing most schools, said Ollie Besteiro, president of the Texas State Teach ers Association. Besteiro, whose group supports the Senate’s $1.2 billion plan, laid the blame at Gov. Bill Clements’ feet if schools close. She said his $300 million limit on new school funding for 1990-91, meant to avoid a tax in crease this year, is “woefully inade quate.” “History has recorded Gov. Clem ents as the first Republican governor in Texas since Reconstruction. If he shuts down our public schools ... I think it would be safe to predict that it may be many, many years before Texans will risk electing another Re publican governor,” she said. If schools close, Besteiro said, TSTA would call on educators, par ents and students to descend on Austin May 5 “in the largest demon stration of public outrage since the fall of the Alamo to Santa Anna.” Clements’ press secretary, Ros- sanna Salazar, responded, “I don’t think you can place the blame of the Legislature’s being unable to reach a consensus on the governor.” GATH RIGHT AWARDS AND BUCK WEIRUS SPIRIT AWARDS ANNOUNCEMENT AND PRESENTATION 9:00 A.M. SUNDAY, APRIL 8 RUDDER AUDITORIUM All applicants should attend! J The Society for Entrepreneurship and New Ventures ‘'A ENVE Invites All Aggies to our General Meeting for Spring 1990 All Current Members Are Asked to Attend Don’t Miss this Discussion of ENVE’s Furture Plans! Monday, April 9 7:00 pm in Blocker 150 Call 693-8978 For Info (Ask For Britt)