Officials: Signs point to economic recovery

"If you have a normal amount of growth in the city that tracks with inflation, you don't have that pressure every year to say you need to raise property taxes to keep up with expenses," Foster said. "The growth is definitely healthy because it alleviates those other pressures [to raise taxes or fees for services]."

Foster tracks the city's economic indicators, which include sales tax, inflation and unemployment, all of which, he said, have shown signs of economic growth.

"[Sales tax has] been growing stronger over the 12 months from last year to this year, and from [2010] to last year," Foster said. "This year started out a little slow, but after this latest round of permits and building material sales, it's started to pick up, and I expect that will probably continue throughout the summer."

Foster said there was some slowdown in the fall because retail sales had slowed, which is a trend that he will be watching for this fall. He attributed part of that slowdown to new retail outlets opening in surrounding areas, including Temple and Pflugerville, taking away shoppers who had come to shop in Georgetown.

"What's happened in the last two years, our retail sector of the economy has gotten a smaller percentage of our sales tax than what it had been," Foster said. "There was some growth in there, and recently there has been a little bit of contraction while everything else has been growing."

Foster forecasted a 2.5 percent growth in sales tax for the 2012 fiscal year, which has already been outpaced thus far.

"Later this year, if people don't feel good about the economy or are upset about the election, there is always a possibility that that could drive sales figures down, but as far as going through the summer, we are going to look good," he said.

The largest sector in Georgetown's sales tax has been the sale of wholesale building materials, Foster said, and as the economy continues to grow and developers start to build again in Georgetown and the surrounding area, that will continue to be a large part of the sales taxes collected in Georgetown.

Development interest

Georgetown's Economic Development Director Mark Thomas said his office has also seen increased interest from developers and site selectors in recent months.

"We are seeing more proposals, and I would say the quality of the proposals [is better]," Thomas said. "The quality of the projects is way up. They are well-funded projects, and the decisions are not solely based on incentives, which to me—all of those things—are really good signals."

Thomas said from his perspective, companies are getting ready to expand.

"I feel like locally that there is more strength in the economy," he said. "Proposals keep filling the pipeline, and I think the fact that we have more to work on gets us closer to the next [economic development] deal."

Building permits rise

The number of new residential and commercial building permits is also on the rise in Georgetown, which is a sign of growth. There were about 39 percent more permits issued in the first quarter of 2012 than the first three months of 2011.

"It's a fluid number," Georgetown Building Official Dave Hall said. "But we hope it will [continue to increase]."

Permits are needed for all new residential, single-family dwellings and new commercial buildings, as well as tenant finish-outs and other industrial uses, all of which signify movement in the marketplace, Hall said.

"People are trying to get started; they are trying to do deals, but it is still challenging," said Ercel Brashear, a broker with Georgetown-based commercial real estate firm Brashear Properties. "Folks are nervous and a little skittish, and so we are seeing a lot of second-guessing, but there is no question that the phone is ringing more frequently, and people want to be back at work."

Brashear said he has seen more interest in Georgetown from small-office space users and national retail site selectors. That, along with low unemployment—Georgetown is at 5.9 percent—and people continuing to move into the area, are good signs, he said.

"All of those are things that are kind of precursors to a rebound in the commercial sector," Brashear said.

Economic outlook

For Foster, all signs are pointing to what he calls a new normal for Georgetown's economic growth.

"The overall picture is that it is moving faster than it did in '08 and '09. I don't want to say it's quite as normal, because in the 1990s and early 2000s, Georgetown was experiencing explosive growth, and they sort of got to thinking of that as normal," Foster said. "I try to tell them that normal is usually around 2 [percent] to 4 percent growth in a year, and it looks like we are headed in that direction. As people continue to move to the area, the population growth could help drive that a little higher."