At its Aug. 10 meeting, Conroe City Council voted 3-2 to deny a request by the Conroe Industrial Development Corp. to enter into a contract to purchase 410 acres to expand Conroe Park North, an industrial park home to companies employing more than 3,000 people in Conroe. Council Members Harry Hardman, Marsha Porter and Howard Wood voted against approval, while Curt Maddux and Todd Yancey voted for approval.
The CIDC board vote was 6-1, with Wood voting against it in his capacity as a board member as well.
In a nutshell
The CIDC was seeking approval to purchase 410 acres for $32.8 million to expand Conroe Park North. The land would have been purchased using CIDC bond proceeds, according to the Aug. 10 agenda packet.
“It’s very close to our industrial park, which we have just about sold out,” CIDC Board Chair George Waggoner said in an interview, referring to the land. “We continue to get quite a few inquiries from different companies all over not only the country, the world, looking to move this direction.”
The council members who voted in favor cited the expansion bringing economic growth to the city and creating jobs and revenue, while the council members who voted against spoke about financial concerns and redirecting economic development toward other ventures, such as vacant buildings.
The background
Conroe Park North, a 1,655-acre industrial park, is home to more than 40 companies and 3,000 employees, according to the Conroe Economic Development Council’s website.
During an Aug. 8 economic forum presentation, CEDC Executive Director Danielle Scheiner said the park is at 98% capacity, Community Impact previously reported. The CEDC is funded by $0.015 sales tax for economic development that was approved by Conroe voters in 1994, according to Scheiner’s presentation.
Maddux, who also serves on the CIDC board, said in an interview around 115 acres remain in Conroe Park North and around 200 acres remain in the 248-acre Deison Technology Park.
Those in favor
Maddux said he was floored by how the vote turned out.
“We’re trying to bring economic growth and an economic financial impact to the city,” Maddux said. “We’re spending money to make money, but our capital is the land, and we’re almost out of land.”
Maddux said in the three years he’s been on the CIDC board, almost 500 acres of land have been sold.
“So if go by that pace, we could be out of land in a year,” Maddux said.
Maddux said the purchase would give the CIDC enough land to last about three to four years.
“The financial impact is what we’re looking for,” Maddux said. “We want all the economic development. This creates jobs, and it creates revenue for the city.”
Yancey, who also serves on the CIDC board, was the other council member to vote in favor of the land purchase.
“Everybody has their own opinion, I do respect that because we are tight on money,” Yancey said in an interview. “And I understand that, but I just thought this was one thing that would have made money.”
When it comes to economic development, Yancey said he wants to see more sustainable businesses that can help the city’s economy and bring in money.
“I really do believe that there’s more and more people looking at us because of the traffic, everything that’s going on in Houston,” Yancey said. “We’ve got a safe place to live, safe place for their employees to live. We have a low crime rate, a good pay scale. We’re almost the perfect place to live.”
The cost
The land the CIDC wanted to purchase would have cost $32.8 million and been paid for using CIDC bond proceeds, according to the Aug. 10 agenda packet.
Waggoner said the CIDC and the city are separate entities, with separate budgets.
“We are in a very strong financial position within the CIDC where, at the end of June, our cash on hand was right at $30 million, just a little over that,” Waggoner said. ”We’ve got a couple of other properties that we know are under contract that will close and provide even more cash.”
Waggoner said by the end of October, the CIDC is projected to have between $42 million-$45 million in cash, and the entity’s debt service is about 37% of its baseline budget, which is “very easy.”
“No financial pressure on the organization at all,” Waggoner said. “You hear quite a bit about the hotel and convention center, and yes, we were involved in that. But we’ve got the ability to handle those obligations with very little financial stress to the CIDC financial position.”
The land purchase would have likely been paid for with a combination of cash and bonds, Waggoner said.
“We look for what’s going to be the best use of our assets, our capital, and felt like that this would be a fairly short-term hold, quite honestly, just based on the number of inquiries we’re getting,” Waggoner said. “The other thing that we thought was it would be very good for the city of Conroe [and the] CIDC to have control over the use of this property.”
Those opposed
Wood cited the city’s finances as one of the reasons for his vote.
“This year's financial position required we make drastic cuts across every single department in the city,” Wood said in an emailed statement Aug. 24. “We must stick with this mindset throughout the year to achieve a much healthier financial position in [fiscal year] 2025-26.”
In an interview, Wood touched on the Hyatt Regency Conroe Hotel and Convention Center, for which Conroe City Council approved an additional $5.1 million in May, according to prior reporting.
“We don’t know exactly what this hotel is going to cost us,” Wood said in an interview. “I wanted to be prepared that, while I like the idea of the development, right now we have some unforeseen costs, and I want to be prepared until we fully understand what those are.”
Wood also said he does see value in the park’s expansion but would like to see other economic development initiatives.
“I’ve mentioned some redevelopment,” Wood said in an interview. “We have several vacant buildings, lots, shopping centers, etc. I’ve voiced an opinion that I’d like to see that addressed. Are there creative things we can do to attract different types of potential companies?”
Porter also said she would like to see economic development focused on filling vacant buildings.
“I would love to see us do some projects, maybe around town, [with] some of the empty buildings,” Porter said in an interview. “Try to encourage development of that [type], bring in companies.”
Porter also said she had financial concerns.
“We have committed to a hotel,” Porter said. “And we’ve also committed to the Oscar Johnson [Jr. Community] Center. ... I just felt like when we’re cutting back on everything, that it was not the prudent thing to do to go spend $32 million dollars out of our CIDC fund.”
Hardman said his concerns about the expansion request were also financial.
“There’s a lot of different things that we can and should spend that money on,” Hardman said in an interview. “I just did not believe that that tract of land at this time for that purpose was the right investment to make.”
Hardman said there are opportunities for smaller investments rather than one big investment.
“I think there’s a lot of opportunities to acquire property closer in the city and repurpose that,” Hardman said. “You look at some of the major buildings that have been vacant for a while, we can potentially repurpose those and bring in new businesses more internally.”
According to the city
“Everyone must remember this is precisely how government is designed to work,” Conroe Public Information Officer Andrew Yousse said in an emailed statement. “We have council members who are very passionate in their support of this agenda item, and we have council members who are very heartfelt in their vote against it. Both parties believe their position is the best for the city of Conroe today, tomorrow and our future. The voting determines the course of action taken.”
Going forward
Waggoner said the next steps for the CIDC will be something the board will discuss at its next meeting, set to take place sometime in September.
“We will also work with the City Council to get direction on what they’re looking for,” Waggoner said. “We’ll continue to recruit business and retain business in Conroe.”
