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Metro adds 20 hybrid buses

David McAndrew — Fri, 12 Mar 2010 22:00:00 GMT

The new hybrids are part of METRO’s bus replacement program which calls for 100 new buses to be added to the fleet each year. They are also part of its initiative to go green.

The 55-seat coach vehicles, which run on clean diesel and use an electronic motor to optimize performance, will be used for Park & Ride service.

To date, METRO has more than 262 hybrid vehicles, local and commuter, in its fleet.

12-Mar-10 4:00 PM

O’Malley: Back loans with TARP cash

David McAndrew — Fri, 12 Mar 2010 22:00:00 GMT

To help jump-start small-business lending, Gov. Martin O’Malley is asking the White House to funnel $3 billion from the Troubled Asset Relief Program to the states so they can expand their loan-guarantee programs.

Allocating $3 billion for programs in Maryland, the other 49 states and the U.S. territories could result in banks making as much as $18 billion available to small-business borrowers, O’Malley and the governors of 27 other states said in a letter sent to President Obama on Feb. 24. That’s a ratio of $6 in loans for every $1 backed by the government.

Supporters say the proposal, if adopted by the Obama administration, could help bridge the gap between small-business owners who can’t get credit and bankers who say they’re willing to lend, if they can find qualified borrowers.

That disconnect has stalled the economic recovery because small businesses, which create most of the jobs in the country, have had a hard time finding money to expand.

“As the American economy is recovering from a global recession, one of the lingering challenges continues to be access to credit, especially for our small businesses,” the governors’ letter said. “In the aftermath of excesses on Wall Street, banks have been forced to adopt significantly stricter banking practices in serving their Main Street clients who live and do business in our jurisdictions.”

The initiative O’Malley is pushing would address the problem by carving $3 billion from $30 billion in TARP funds the Obama administration wants to make available to community banks to fuel small-business lending.

Instead of going directly to participating banks, the money would go to state programs that protect lenders in the event a small-business borrower defaults on a loan.

The idea is that banks would be more willing to write loans for quality businesses that fall just short of new, tougher lending standards if a portion of the loan is backed by the government, said Christian S. Johansson, secretary of the Maryland Department of Business and Economic Development.

“We can’t help a business that’s not viable, but we can help a business that’s viable cross the finish line,” said Johansson, who is working with O’Malley on the effort.

O’Malley’s proposal is separate from his administration’s plan to set aside $10 million from the Maryland Industrial Development Financing Authority for small-business loan guaranties.

It’s not clear how much Maryland would receive under O’Malley’s proposal because it hasn’t been determined how the money would be divided up among the states. If the money is divvied up based on population, Maryland could receive about $60 million, Johansson said.

Expanding money for state loan-guarantees could encourage bankers like Joseph Haskins Jr., CEO of Harbor Bank of Maryland, to write more small-business loans.

“It may provide a comfort level for some banks,” Haskins said. “I’m certainly much more inclined to extend a loan where there’s a guarantee.”

Kathleen Murphy, CEO of the Maryland Bankers Association, said she supports the initiative and expects that her members will, too.

A program that would make bankers less reluctant to make small-business loans sounds good to Ellen Valentino, Maryland state director of the National Federation of Independent Business, although she wants to hear more about the details of the program.

“This looks like it could be a good thing, and a way to unfreeze some capital,” Valentino said. “The governor clearly sees that the small-business community in Maryland is in some distress, and he’s looking for unconventional ways to improve things.”

State Del. Anthony O’Donnell, the House minority leader, has a different view. Instead of funneling more money to the states, the federal government should use it to pay down the national debt, said the Republican lawmaker, whose district covers Calvert and St. Mary’s counties.

“The federal government is bankrupting itself,” O’Donnell said. “We’re one of the richest states in the nation. We shouldn’t be looking for a handout.”

12-Mar-10 4:00 PM

Houston Economic Update, July 2009

David McAndrew — Wed, 05 Aug 2009 16:00:00 GMT

Houston Economic Update, July 2009

Fundamentals are improving for the Houston economy, which seems to be responding to better news. The U.S. recession is apparently drawing to a close, with a wide range of measures pointing to a turnaround in the fall. Oil prices and a variety of other commodity prices have moved up in recent weeks, reacting to massive stimulus purchases out of China and to the approaching U.S. recovery. The U.S. rig count has turned up, chemicals exports have soared for some commodities and local employment was stable in June. The turn in the U.S. economy looks real, but the question for Houston’s near-term economic performance is whether the commodity markets have turned too early. Will Chinese stockpiling today mean weaker demand tomorrow as recovery sets in?

Retail and Auto Sales
Retailers in Houston pointed to a turn for the worse in late June and early July, as sales figures fell well short of their plans. Discounters did the best, but conditions worsened steadily as profit margins increased, with high-end department stores and specialty stores faring the worst. Some respondents felt the Texas heat wave played a role in keeping shoppers at home.

Houston remains an active participant in the ongoing auto bust of 2008–09, with local sales down 40 percent over the first half of 2009 and down nearly 50 percent from last June. For this diminished number of purchases, lower gasoline prices have moved shoppers back to a preference for SUVs and trucks.

Housing and Real Estate
In another sign that Houston is following the national economy’s lead, the local housing markets is responding to lower mortgage rates and first-time buyer incentives. Sales of existing single-family homes are down 15 percent from a year ago (improved from a decline of 23 percent in January), and the median price has ticked up steadily all year as more expensive homes have begun to sell again. New-home sales and permits, in contrast, are still down sharply (both near 40 percent on a 12-month basis) and have yet to turn up. The median sales price has been steady for the last year.

All commercial real estate sectors continue to feel the grip of recession and tight credit conditions. Retail, industrial, office and apartment occupancy is down, as a combination of new construction and reduced demand takes a toll. Office and industrial rents are under the greatest pressure.

Oil Markets and Refining
Light sweet crude spent most of June near $70 per barrel, only to fall back to $60 in early July. The rise to $70 seemed to defy market fundamentals of weak demand and high inventories. Domestic demand for oil products remains weak—gasoline demand is down only 1.4 percent from a year ago, but both distillates and jet fuel are down 15 percent.

Refiners operated at a steady 86 to 87 percent of capacity utilization. Weak demand for oil products made it difficult for refineries to pass through the higher price of crude oil. Profit margins remained at the weak levels of recent months and at only half the level of a year ago. On-highway gasoline prices rose about 10 cents per gallon in June but fell back in July.

Oil Services and Machinery
The total number of rigs working in the U.S. appeared to stabilize in June and rose by about 50 rigs in late June and July. The pattern was seen in both Texas and New Mexico, though not Louisiana. The improvement was driven by rising oil prices. Natural gas prices remained relatively weak, and producers took the opportunity to switch from gas- to oil-directed projects and to expand the number of wells drilled. The oil-directed activity was described as opportunistic, with no pattern in terms of geography or technology. Natural gas-directed activity continued to fall. The excess capacity in the industry remains so large (with activity down by over half from the peak) that a small and possibly transitory pickup in activity was not felt in sales or pricing.

Healthy natural gas markets are needed for a sustained U.S. recovery in drilling, and the outlook for natural gas is so bearish that neither $70 oil nor a serious heat wave in the Middle West and South did much to improve its price. Inventories are expected to be at record levels before fall. The price moved briefly over $4 per thousand cubic feet in June but was again below $3.50 by early July. Production is about 3 percent higher than it was last year, and demand remains weak.

Petrochemicals
The prices of a variety of chemicals are rising. Ethylene and polyethylene prices are up on increased export demand, and styrene and polypropylene prices have been driven by rising energy prices. PVC is up because of rising ethylene and chlorine costs. Export demand is quite strong due to cost advantages based on the price of natural gas versus oil, with help from strong Asian demand driven by China’s stimulus package. The open question is whether the Chinese stockpiling of commodities at low prices just means less demand as recovery begins in earnest. Domestic demand is generally weak, with products like polyethylene and caustic soda reporting modest month-to-month increases.

5-Aug-09 11:00 AM

Texas Equipment Leasing Market Looks Favorable for 2005

Jerry Harris — Mon, 22 Nov 2004 23:00:00 GMT

As economy recovers, demand for all products will increase. Leasing provides the end users the ability to obtain the equipment they need to expand as their customer demand grows. Harris Leasing Company has terms to fit the cash flow requirements of expanding companies in the Texas market.

22-Nov-04 5:00 PM