Gary Borsch has been chair of the Greater El Paso Chamber of Commerce, one of the largest non-profit business advocacy organizations in El Paso, for three months.
And already there has been a lot to do. The issues impacting businesses and economic development in El Paso these days are many.
There are the financial troubles at El Paso Children’s Hospital and concerns the city isn’t moving fast enough on the quality of life bond projects approved in 2012.
The upstart Borderplex Alliance is settling in and figuring out where it belongs among all the other business development groups in El Paso.
There is the uproar over property valuations. And in May, there are city and school board elections. Closely watched are the races in the El Paso Independent School District, which has been overseen by a board of managers since the cheating scandal.
Overall, though, Borsch said El Paso businesses are optimistic about the future.
The Greater Chamber of Commerce, which is 116 years old, represents almost 1,800 businesses in El Paso and is one of the oldest chambers in the state.
Borsch replaced Joseph “Jody” Mullings as chair in January. Borsch is also CEO of El Paso-based Professional Investment Counsel, Inc., a money management firm.
He was raised in Florissant, Missouri. The St. Louis suburb is located near Ferguson, where 18-year-old Michael Brown was shot and killed by a police officer last August, sparking clashes between residents and police.
It was a very different place when he was growing up there, Borsch said. More segregated.
Borsch’s dad was a bartender and worked in Downtown St. Louis at a private club called the Missouri Athletic Club, which is still in operation today.
Immediately after graduating with a degree in English from Monmouth College in Illinois, Borsch was drafted. He spent three years in the Army – the last 18 months in Turkey.
“I ended up doing some nuclear weapons work in a remote site under NATO. We were top secret, and it was interesting stuff,” Borsch said.
And that’s all he had to say about that.
Later, Borsch worked in advertising with Procter and Gamble and was a stockbroker for a time. He has lived in El Paso with his wife, Laura, for nearly 39 years.
Borsch sat down with El Paso Inc. and talked about why school board elections matter, what’s wrong with property valuations in El Paso and how he recently found out he’s not the only El Paso CEO who grew up near the now-infamous town of Ferguson, Missouri.
Q: How are local businesses feeling about the El Paso economy? What are you hearing from chamber members?
They are generally upbeat and positive about the El Paso economy.
However, there are some impediments that have arisen that are clouding the horizon a little bit, not the least of which is that El Pasoans overwhelmingly endorsed the quality of life bond issue a couple of years ago for almost half a billion dollars.
They feel a bit frustrated that the big, signature projects are not moving a little bit faster.
Q: El Paso businessmen Paul Foster and Josh Hunt, and others, have urged the city to get moving, particularly on the projects like the arena and children’s museum.
The chamber has been actively urging the city for close to a year now to speed up this process. We have attended City Council meetings and meetings with the city’s consultant.
We get the message from the mayor, city manager and representatives that they are moving as fast as they can, and we encourage that process.
Q: Why do these projects need to be done faster?
The takeaway from the city consultant’s presentations is that the longer you wait, the less you are going to get for the money. And that is assuming low inflation and low interest rates.
If you factor in what appears to be on the horizon, higher interest rates, what you get for the money is even lower.
Q: What were the chamber’s top achievements last year?
We had a very successful trip to Nashville, Tennessee. We had 45 people attend, including the mayor. We met with the Nashville mayor, city officials, folks in education and others.
We talked about how they turned their city around. They also wanted to know how we got our ballpark built in 11 months, since they are building a stadium and it is going to take them a couple years to do it.
It was a similar trip to the one the chamber sponsored to Oklahoma City a couple of years ago to talk about El Paso getting a Triple-A franchise and how Oklahoma City did it. We gained knowledge and sowed the seeds for future ideas.
We also had our first full year of our new superintendent at El Paso Independent School District, Juan Cabrera. He spoke at the end of 2013 at our State of the Education luncheon; he had been in town less than a month.
We worked closely with him, through our education division, to help him get to know people and get to know El Paso.
Q: The chamber did get quite involved after the big cheating scandal at El Paso ISD. Are you satisfied with the progress made since then?
We are pleased that things are moving in the right direction. The board of managers, their two-year term will end this coming May and we will have elections.
It is important that everybody gets out and votes. I cannot tell you how important it is to get a big turnout.
Q: Voter turnout has traditionally been extremely low in school board elections. Why is it important to boost voter turnout?
If you take the overall balance sheet of El Paso ISD, you come up with a company big enough to be in the Fortune 1000. As much as 60 or 70 percent of your property tax bill goes to public education. You would think people would see that and would be a little more concerned.
Let me give you some scary statistics that the superintendent of Ysleta ISD gave us a couple of weeks ago. In the Ysleta school district, there are only about 6,900 eligible voters. Of those, somewhere around 600 are actually registered to vote. Of those, somewhere in the neighborhood of 300 voted in the last school board election.
Having voter turnout that low opens the election to small, narrowly focused special interest groups who can throw the election one way or the other, and voters in the Ysleta district will consider approving a $452-million bond in May. That is sobering to me.
Q: At one point, the chamber considered endorsing school board candidates. What happened to that idea?
The chamber has traditionally never endorsed political candidates; we have felt that is not our position. But we decided that this upcoming school board election, particularly in El Paso ISD, was so important that we had to go on the record. We had that all approved.
But here’s why very few chambers of commerce endorse candidates. Our attorneys noticed that there is a Texas statute called the Charitable Immunity and Liability Act of 1987. It gave immunity to people who volunteer to work with civic and non-profit organizations, so they could do volunteer work without fear of lawsuits.
For chambers of commerce to be eligible for that immunity, they cannot participate or intervene in any political campaign. It was a pretty easy decision not to lose immunity for our volunteers.
However, we did send questionnaires to the candidates and have posted them, unedited and in their entirety, on our website at ElPaso.org.
Q: With the new Borderplex Alliance settling in and finding its place among the various business and economic development groups in El Paso, has there been any overlap between the alliance and the chamber?
A little over a year ago, when the chamber asked me to be chair-elect, one of the things I said was that I was concerned about the perception, if not the reality, that Borderplex Alliance and the chamber of commerce were somehow competitors. We are not competitors.
There have been some misconceptions, hurt feelings and ill will develop in both organizations toward each other. I decided I would spend the year trying to remediate those issues and have worked with Woody Hunt at Borderplex Alliance to come up with ways to clarify the missions of each organization and come up with ways we can get along better.
Q: I take it the Borderplex Alliance does business recruitment whereas the chamber doesn’t.
Exactly. That is one thing we are in the process of trying to articulate, and I think you will see the results of that here shortly. The chamber of commerce is an advocacy group and Borderplex Alliance is focused on recruitment and retention.
Borderplex is also very much a regional entity. They cover Southern New Mexico, Northern Chihuahua in Mexico and El Paso. Their efforts extend not only to Austin, but also to Washington, D.C. The chamber’s focus is more local.
Q: The chamber has led in outreach to Fort Bliss.
That’s one area where the roles have become clear. The Borderplex Alliance has asked the chamber to continue to be the lead with military relations, which we are glad to do.
Q: El Paso benefited greatly from the last round of military base closures, the Army investing $6 billion to grow Fort Bliss. Other posts were not so lucky. Should El Pasoans be worried about a proposal for another round of military base consolidation?
Fort Bliss is the pre-eminent military installation in the country, and the chamber has a very good relationship with the post. Later this month, we are going to be hosting what is called a supplemental programmatic environmental assessment listening session here in El Paso.
Q: That is a mouthful.
It is a big deal for the future of Fort Bliss. Army officials from Washington, D.C. are traveling all over the country and visiting military installations.
They don’t want to hear stories about how businesses might close down if, say, the troop strength were lowered at Fort Bliss. They want to know what El Paso has done to support Fort Bliss, and we have a good story to tell in that regard.
Q: Business owners have been in an uproar over property valuations. In a nutshell, what is the problem?
Here is what makes El Paso different from the other cities in Texas: If you look at Dallas, Austin or San Antonio, you’ll find that the property tax base is roughly two-thirds commercial and one-third residential. El Paso is the opposite. That is a recipe for inequality, improper valuations and attempts to get more from less.
There is no question, with a legal budget at the Central Appraisal District of $500,000 to fight challenges to property valuations, the path of least resistance is for the CAD to cave in, grant a small increase to make the protestor feel like they are getting something, but the next cycle just to raise it again.
Q: The chamber produced a white paper recommending a number of changes. One of the top recommendations was to get more people with private sector experience on the board of the Central Appraisal District. Are you satisfied with the progress that has been made?
The white paper was a sort of guideline to begin the debate, so it is a little early to tell. The chairman of the CAD board is now Jerry Romero from Wells Fargo Bank. We supported Jerry, and I think we have been able to make a few incremental changes to try to get the system to operate more fairly.
It’s very difficult when you have large private entities like Western Refining who, in all fairness, consider the property valuation the CAD puts on them to be unfair. They have the resources to fight that, and they have fought it successfully over the years.
So when they get $3 million back from the city, it makes headlines. But when a small business owner contests their valuation that has surged 40 percent in one year…
Q: You’re saying what a business pays in property taxes should not be influenced by how many lawyers it can afford?
That is a part of the system that is just not working very well, that we are trying to change for the better. But it all goes back to what I said about the tax base. The more we can grow the private sector, the more the tax burden can be spread out.
Q: How does chamber membership compare to previous years?
Membership is up slightly. There is no question that the Borderplex Alliance has attracted some members who would like to invest specifically in economic development, as opposed to the advocacy side of it.
The chamber is in excellent financial condition right now. We have no debt and have never been in better financial shape than we are in today.
Q: El Paso Children’s Hospital is in deep financial trouble and officials are scrambling to keep it open. Doctors and parents and public officials are concerned. Is the business community?
Yes, and I’ll tell you why. For those of us who have been in El Paso a long time, we remember when the city had an economy supported by things like copper smelting and the garment industry. But those industries have been out of here for at least a decade.
What we have in its place is a growing, vibrant health care industry. You see it at University Medical Center, the Medical Center of the Americas and the new RedSky incubator. You see it at Fort Bliss with the new $1.3 billion Beaumont Army Medical Center under construction. You see it with the plans for a new private sector teaching hospital on the Westside.
When you have an entity like a children’s hospital foundering and suffering, that is a black eye on the whole industry, and it needs to be corrected and dealt with properly and quickly.
Q: You grew up near Ferguson, Missouri?
Yes. As a matter of fact, Sandra Braham, CEO of the YWCA in El Paso, grew up in a little town called Kinloch, which is an all-black suburb of St. Louis. And I lived about eight miles away in a little city called Florissant; Ferguson is between the two.
I didn’t find out about this until last September, but Sandra was adopted by a family in Florissant and was raised, literally, three blocks away from the street I grew up on.
Q: What was it like growing up there? You must have watched with special interest as the events unfolded in Ferguson.
It is not as bad as the news media has made it to be. I actually went to high school in Ferguson my freshman year. It is very different now from when I was growing up there. It was so segregated when I was growing up, and it was predominately white. But now it is predominately black, so the demographics have switched around.