The following is a speech from McAllen Mayor Richard Cortez.
It was released to Action 4 News prior to his address to the McAllen Citizen's League today.
Thank you for being here and for caring about an issue that is important to the City of McAllen.
Having a Performing Arts Center that we can be proud of is important to me and to your City Commission.
Also important to me and the City Commission is McAllen’s financial well-being.
Our ability to stay financially sound is dependent on thoughtful decisions regarding our finances.
If you look around, we have some wonderful assets located in McAllen.
All the assets were acquired in a fiscally responsible manner.
The whole debate about keeping the Civic Center Auditorium or not was settled some time ago through a Charter Election.
The voters of McAllen decided they wanted “no more funds” invested in the existing location and that it had to be re-located to the Ware Road site.
The question now is not IF we must leave the site, but WHEN.
Many have asked: “Why didn’t you build the auditorium when you built the Convention Center?”
That’s a reasonable question.
McAllen was then, and remains today, a fiscally conservative city.
In order to build a new auditorium, we have to pay for that new auditorium.
McAllen spent over 56 million dollars developing the site on Ware Road to expedite future improvements.
The site was intentionally developed to make room for a new Performing Arts Center.
We completed the main building.
We sold the frontage to Simon and ended up with a Convention Center that is completely paid for.
We then had to operate the new center and try to stabilize the operational costs.
Operating costs have now been cut and are stabilized at both the Convention Center and the Civic Center Auditorium.
There are other issues involved here.
The national economy went into a recession and a major source of revenue for McAllen was reduced.
For the first two months of the current fiscal year, our sales tax rebates have only been slightly up.
What this tells us is that we are still not fully recovered from the negative effects.
With this decline in revenues, do we take the chance and build a new auditorium BEFORE we have the money from the sale of the old site and before we know where we will get the money to finance the remainder?
This would be like buying a big house and hoping you will get a better-paying job later.
No reasonable person would do that.
Government should be no different.
We are in the planning stages of developing the best plan for building the new auditorium.
One way is to use the proceeds of the sale of the old site and allocating the new sales tax flowing from that new development to pay for it.
Today we only have inquires no offer yet.
We don’t know how much we can get for the site or when a new buyer would want to take possession.
All of those unknowns would be resolved in a negotiation.
We would rather go through a temporary interruption in service than suffer through a financial blunder.
HERE IS WHAT WE KNOW TODAY:
1. There is no choice about what will happen to the current auditorium. The voters decided that in 2002.
2. McAllen must maximize the potential use of all properties near the Expressway because we have only a finite amount of expressway property. Retailers decide where they want to build, NOT the city. Please also remember we are in competition with other cities for the same retailers.
3. McAllen delivers high levels of service to its citizens and to the region primarily because we are and have been the center for retail.
4. We have a large police force and fire department, which cost a lot to operate.
5. We have iconic, beautiful and plentiful parkland being watered, mowed, edged and well-groomed, which is also quite costly.
6. We have the metro area’s airport, the metro area’s Convention Center, and will have its biggest library, as well as many community centers and branch libraries - all expensive to operate.
7. At the same time, we have a very low property tax rate, which has remained the same for over a decade, and the ad valorem taxes we receive are completely usurped paying for our police department.
The combination of high levels of service, quality public facilities, very low debt and low property taxes, are impossible to sustain unless we increase our sales tax revenues by bringing in new key retail businesses.
As your Mayor and City Commission, we want to continue to identify and recruit companies that will ensure our sales tax strength in the years to come.
Our plan needs to be flexible to provide for an uncertain future. A flexible plan allows us to negotiate the best overall outcome.
Part of McAllen’s ability to be successful is that we’ve always been able to plan, forecast and make deliberate decisions based on empirical data and sound information.
Planning for a new performing arts center is no different.
Let’s move forward to do what the voters asked us to do in 2002 and carefully plan and invest in a new center all of us can be proud of and eliminate any unrealistic conditions that will take us off course.
Thank you.
Let’s Meet in McAllen!
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