ustxtxb_obs_1991_04_19_50_00007-00000_000.pdf

\\VM Q %, 4y1 g tatt \\AVIA kafilm1S5MACT ‘\\ \\%04.1V-olx “%ATM% \\ ei r r /Id r nt5 ilsarance 5D12 1# a I 7 1&44214:42” aziwz ever LESLIE FLOYD Mexico. While technically correct when the document elsewhere claims “there will be no direct discharge to the Laguna Madre,” discharging into a small channel that empties into the laguna certainly qualifies as an environmental concern. Contradicting the document, Nicholas told the Observer that the wastewater treatment will have a “closed system” with “total reuse.” Despite the hype surrounding the venture, American General after two years has yet to put bulldozer to sand dune on the previously undeveloped part of the barrier island. That’s not because of environmentalists’ opposition, although groups like the Sierra Club and the Audobon Society dislike the project. The company’s plans have been held up because it spent the last year trying to create the financial infrastructure to fund parts of the development using public money. While officially downplaying the venture’s risks in the current Texas real-estate bust, American General, a Fortune 500 company with a reported $30 billion in assets, undertook a threepronged effort to publicly fund the infrastructure for its major development at the federal, county and state levels. Solomon Ortiz Hits the Beach Before building a resort in this litigious age, the company needed, among other things, insurance. On South Padre Island, insurance is expensive because hurricanes hit there more often than any other part of the Gulf Coast. To make matters worse, American General’s land sits inside the federal Coastal Barrier it from federal flood insurance and subsidies for roads and water treatment. To overcome that obstacle, American General convinced Democratic Congressman Solomon Ortiz of Corpus Christi to attempt to take the proposed 4,000-acre development out of the CBRS discouraging development in hurricane-prone coastal areas was an explicit reason for the original Coastal Barriers Resource Act \(See “Solomon Ortiz Hits the Beach,” TO , Ortiz pushed to remove land from the CBRS for another resort, Playa Del Rio, which eventually went bust taking two savings and loans down with it, according to newspaper accounts. Representatives of Willacy County, Raymondville and Port Mansfield were flown to Washington to lobby to exclude the American General property from the CBRS. This show of local support resulted from months of lobbying American General first contacted local officials in August 1989 about the “concept” for an “international destination resort.” Bill Maples, a San Benito City Commissioner with connections to Solomon Ortiz, became a paid consultant to promote the project locally. David Mayfield, port director of the Port Mansfield Navigation District, helped organize a trip to Washington, D.C. funded by the Willacy County Industrial Development Foundation, a sort of shadow chamber of commerce that lobbies for, but claims it’s not funded by, American General. Ortiz temporarily succeeded in amending legislation to let American General receive federal-flood insurance and other subsidies. But House Banking Committee Chairman Henry B. Gonzalez of San Antonio pushed through another amendment that defeated the first, excluding Padre Island developers from federal benefits because of the dangers of building on barrier islands. “Gonzalez said his amendments were designed to protect the environment and the taxpayer,” wrote Dan Carney of the States News Service. Willacy County and the Art of the Deal Having failed in its search for subsidies at the federal level, American General then turned its sights on the Willacy County Commissioners Court, hoping to share liability for the project’s infrastructure with the local government. American General, through its attorneys from Houston’s Vinson & Elkins, petitioned the Commissioners Court to create the Willacy County Water Control and Improvement District No. 1. The court imposed only cosmetic alterations to the company’s proposals; the most important, in Commissioner Gene F. “Scooter” McGee’s opinion, changed the name of the district to “Tesoro Del Mar Water Control and Im THE TEXAS OBSERVER 7