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Columbia Business Monthly


Sep 01, 2017 04:02PM ● By Emily Stevenson
By John Temple Ligon
Principal, Gervais Studio

About a year ago, my Texas Monthly carried a cover story on Austin, “The New Austin and How It Became the Center of Everything.” Back when I lived in Houston (1975-1986), Austin was the center of state government, and that was about it.

Now it’s Boomtown. The reasons why are too many to discuss here, but three come to mind: (1) high-quality bus transit, (2) low property taxes, and (3) cheap electric power.

Now that SCANA has failed miserably, first with its bus system and now with its shutdown of two nuclear power plants, maybe it’s time to reconsider some of Austin’s advantages and some of Columbia’s disadvantages.

In 1975, my first visit, Austin was not a whole lot different from Columbia: little industry, few high-rises, state capital, flagship state university, low pollution, slow growth, cheap rent, great barbecue, lousy bus service.

I got to learn about the New Austin when I researched bus transit in the summer of 1991. I remembered Austin as comparable to Columbia, so I thought it a fair comparison for bus transit systems. Austin’s light rail system in 1991 was still in the planning stages.

To ensure fairness, I took Columbia and its urbanized area (UZA) population based on the 1980 census, which was the bus service area population that determined federal transit subsidies. At the time, Columbia had a UZA of 311,561 people, not much less than Austin’s 379,560.

Come forward a decade to the next population census, the count in 1990, and Austin’s growth really began to leave Columbia’s behind. In 1990, the UZA in Austin was 562,008, an increase of 48 percent from 1980, and Columbia’s grew to 328,349, an increase of 5 percent.

In 1990, Columbia’s urbanized area bus service population (UZA) put 34 buses on the morning streets while Austin’s bus system ran 343 buses. That 343 is now closer to 400, and Columbia’s is up to 41, reportedly. Roughly speaking, then, Austin has 10 times the bus count every morning, while Austin is not even twice the population count. Put differently, in per capita terms, Austin for the past 20 years has been running bus service six times that run in Columbia.

Austin’s political boundary, the population inside the city, has never been much different from the UZA or even the MSA, the metropolitan statistical area. That’s because by state law, any city or town in Texas can add 10 percent to its area every year, essentially keeping up with escape-based sprawl. In Texas, once you think you have moved away from the city, the city catches up with you. In Columbia, though, its city population in 1990 was about a third of its UZA because in South Carolina, state law makes it tough to expand, keeping cities small and removed from tax-rich surrounding suburbs.

Getting away from bus service populations, Austin can be described by its MSA, 585,051 in 1980, 846,227 in 1990, 1,249,763 in 2000, and 1,652,602 in 2008. Projecting forward, Austin expects more than three million people in its MSA by 2030. By then, greater Columbia can count on probably more than one million in its MSA.

To continue comparisons with Columbia, maybe Austin’s means of delivering electric power to its citizens needs a short review. In Columbia, SCE&G has the monopoly on delivering electric power, which is similar to the arrangements with Duke Energy in Greenville and Spartanburg, say – nothing unusual there. But in Orangeburg and Camden and Rock Hill, these towns buy their electric power in bulk at the cheapest price available and then the towns, as a municipal service, deliver the electric power to their citizens.

It is not necessarily a small-town concept – Austin works the same way. Whatever margin the municipal power systems charge above cost – no matter how little – becomes a tax, of sorts. The churches and the high schools and the colleges and the local and state and federal government compounds, all get taxed through the sale of electric power. In Austin, the total revenue off its electric power collections, as reported a few years ago, came to $1,162,286,000, out of which $135,500,000 was transferred into Austin’s general fund. Through the sale of electric power, $135,500,000 didn’t have to be collected as property taxes. In round rough terms, that means Columbia’s property owners could see their tax bills fall by a half if Columbia had the same municipal electric power system they have in Austin.

Put differently, in Columbia, electric power profits are paid out as dividends around the world to the utility monopoly’s shareholders, and in Austin the profits are shared with the property owners in town, greatly reducing property taxes.

On the other hand, now that SCANA has lost all credibility, starting with its failure in bus transit and following up with the shutdown of its next nuclear plants, maybe the Midlands needs another look at its relations with it. Maybe the Austin scheme and its municipal electric power system can show the way for the Midlands.

Property taxes in Austin are collected at about half the rate Columbians pay, and the charge per kilowatt hour in a discount deal to encourage conservation and small usage of electric power is half what Columbians pay.

Austin has advantages Columbia can’t have. But Columbia’s disillusionment with SCANA could result in investigations into whole new systems of electric power generation and distribution, not to mention taxation of currently non-taxed properties.