ATX PULSE 8/9/24: Massive I-35 Project to Begin in Fall // ACC Receives $7.5M Grant to Expand Semiconductor Programs // Ruling Requires Public Comment at Work Sessions // $1B Data Center Slated for Taylor // Legendary ATX Lawyer and Business Leader Pete Winstead Dies

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Today’s Weather: H: 98° / L: 78°. Sunny and partly cloudy. Latest forecast from Fox 7 Austin’s Zack Shields here.

TOP NEWS

“Massive I-35 reconstruction project to begin this fall,” Fox 7 Austin’s Rudy Koski — “Brace yourself, the first phase of the massive I-35 reconstruction begins this fall. For those thinking MetroRail trains will help avoid the mess, it's also time to re-calculate that route. 

In October, TxDOT will begin rebuilding the Martin Luther King Junior bridge over I-35.  The $33 million project is needed to prepare for a wider roadway through downtown Austin. Following that, construction will start taking place in the core of Austin. 

Work on a new bridge over Lady Bird Lake and a new drainage tunnel will start in early 2025. In 2026, the MetroRail line into downtown, near 4th Street, will be dug up. That expansion work will shut down the last leg of the Red Line into downtown.

During the typical workday, about 1,700 commuters ride MetroRail trains into Austin, but with the re-construction of I-35, a section of rail, between 4th and 5th Streets, is slated to be dug up. As a result, Plaza Saltillo will be the end of the line, according to CapMetro's Chief Operating Officer Andy Skabowski.  

"It's going to require for anywhere from 12 to 18 months that our customers get off at a station before that and end up taking a bus for that short little ride into town," said Skabowski.

The Red Line rail line detour was initially scheduled to start in April 2025, but the schedule has slipped to early 2026. 

It’s an example of how the entire I-35 project is complicated, especially in the core part of downtown where the Red Line is located.

"Anytime you dig in any part of the country, sometimes you just don't know what's underneath there, and so we're talking about major excavation, where TxDOT is going to be digging in areas that maybe hasn't been touched in decades, if not longer. And then the other thing is, just the overall depth and the penetration of that," said Dave Kubicek, CapMetro’s Executive VP for Capital Construction.

Connector buses for train riders to get them into downtown may be located at the MLK Station or at Plaza Saltillo.  A decision as to which location  will be used has not yet been made. 

"It's going to add a little bit of time to the commute, but it's I don't think it's, you know, a decision to take the train or not. It's just, you know, an inconvenience for a period of time. I mean, for a better end goal," said Skabowski.

A section of track that goes under I-35, near the Hancock Center, will also be replaced. An elevated bridge similar to one that goes over SH-45 will be built. Construction is to be done in phases. That will allow trains to keep on rolling into east Austin. This plan includes building a rail crossing at Riverside for Project Connect; a big reason why the CapMetro part of the I-35 project is estimated at $228 million. 

FOX 7 was told TxDOT will pay the bill and CapMetro is going to get an added benefit out of it. 

"In the TxDOT area, they're going to add a second track for us and then that's going to allow for CapMetro an opportunity in the future, you know, as funding becomes available, and we look at things to potentially add another second track, you know, heading into the downtown area," said Kubicek.

A larger reconfiguration of bus routes into downtown is expected. It could give commuters more options on navigating around the I-35 construction. 

"That thought process and understanding is going to be occurring over the next year or so to really understand what we can do, what would work and how we can best make sure that customers are aware of it and that communications are being pushed out onto that to that effect," said Skabowski.

The total cost for the I-35 Central Express is currently estimated at $4.5 billion according to TxDOT.” Fox 7 Austin

“ACC receives $7.5 million grant to expand semiconductor programs, support UT facility,” Austin American-Statesman’s Lily Kepner — “Austin Community College received a $7.5 million grant from the U.S. Defense Department to expand its semiconductor workforce training programs, the college announced Thursday.

The University of Texas and its Texas Institute for Electronics, a consortium of institutions and partners supported by UT and the Texas Legislature, distributed the funds to ACC. The money comes from an $840 million grant awarded to UT and the Texas Institute for Electronics by the Defense Advanced Research Projects Agency, a federal group that invests in innovative technology for national security to develop a national research and prototype facility.

Alyssa Reinhart, the workforce development director at the Texas Institute for Electronics, said ACC partnered with the group on the DARPA application and that the college has established itself as a strong partner to address industry needs. ACC is the only community college involved out of the 18 academic partners, the college said.

"ACC is fantastic, having them in our backyard to be able to support this," Reinhart said.

Semiconductors are chips that enable technologies like smartphones and computers to function. National and state lawmakers have pushed for greater investments in semiconductor manufacturing facilities and workforce training to ensure the United States can internally meet the rising chip demand required for national security and technology developments instead of outsourcing those industry demands.

ACC has been working with industry partners for 10 years and has been recognized as a leader in semiconductor manufacturing, with U.S. Commerce Secretary Gina Raimondo visiting the community college twice in a little more than a year to offer her department's support. ACC also launched a curriculum last fall designed to train workers to become manufacturing technicians as they work, and it has connections with multiple industry partners.

With the $7.5 million award, ACC will expand its existing semiconductor workforce programs to support UT's work with the DARPA grant and train workers who can run the new facilities and equipment.

"As UT is doing a broader research-based facility, they're going to need their technicians to also do the same thing," said Laura Marmolejo, ACC's dean of advanced manufacturing. "We can support that by providing that training and customizing the training to fit their needs as they define them."“ AAS ($)

“Austin attorney Pete Winstead, a ‘living legend in business community’, dies at 84,” Austin American-Statesman's Shonda Novak — “Pete Winstead, a founding shareholder of the prominent Winstead PC law firm, left an indelible mark on civic involvement and economic development in Central Texas for decades, all the while mentoring a new generation of leaders.

Winstead died Wednesday. He was 84.

Winstead was appointed by Gov. George W. Bush in 1997 to be the first chair of the Texas Turnpike Authority. He also chaired the boards of the Austin Chamber, the Real Estate Council, the United Way, St. Edward’s University, the Greater Austin Crime Commission and KLRU Public Television. He also served as chairman of the $50 million capital campaign for the Dell Seton Medical Center at the University of Texas and received many awards for his involvement in civic, political and philanthropic matters in and around Austin.

"Pete instilled the values of service, teamwork and excellence and held his fellow attorneys to those high standards," the law firm posted on its website.

Winstead received his undergraduate degree from Stanford University and his law degree from the University of Texas. As a young lawyer working for the Department of Justice's tax division in Washington, he was sent to Selma, Alabama, to monitor the civil rights march, an event that his law firm said shaped many of the principles he held dear. 

He became a successful tax lawyer and provided guidance to startup companies, offering mentorship on financial backing, management procurement and a variety of legal matters. The law firm said he played a key role when Winstead took Dell Computer Corporation public in 1988.

Winstead's peers lauded Winstead's significant impact on Central Texas.

"One of the tall trees in the forest fell with Pete’s passing," said David Armbrust, who like Winstead has been one of Austin's most prominent real estate attorneys for decades. “Pete was a living legend in the business community. He will be missed."

Winstead was "a tireless advocate for a better Central Texas," Armbrust said. "He walked the walk, and Central Texas is a better place because he was here."

In a statement on Winstead's website, Jeff Matthews, chairman and CEO, said: "Pete’s great joys were the love of family, firm and his commitment to the city of Austin. He will be deeply missed by all whose lives he touched."

"Known for his superior intellect, as well as his commitment to the firm, his clients, and his community, Pete was highly respected by his colleagues and those with whom he served in various capacities," the statement said.

Joe Willie McAllister, himself an icon in Austin's real estate community, recalled how Winstead's legacy goes back to the era of the late President Lyndon B. Johnson and Pike Powers. Powers, a former state legislator, was instrumental in transforming Austin into the tech mecca it is today.

McAllister said many young lawyers Winstead mentored "turned out to be outstanding lawyers."

"There's a Rolodex of young lawyers Pete mentored who turned out to be all-stars," McAllister said.

"They did stuff under the radar — not under the table," McAllister said with emphasis, noting the distinction there were no illegalities, he said. "They had relationships that they developed because of their honesty and integrity and their willingness to treat everyone fairly and equally."

McAllister said Winsted and Powers "were the ultimate horsepower in Texas."

"Around the Capitol, the Legislature, they had monumental influence on the success this state has had," McAllister said. "A lot of that success was gained by not really being out and trying to do it publicly."

Armbrust said he served with Winsted on several nonprofit boards. He said Winstead "was always passionate about helping people and making our community better.

"When I asked him to serve," Armbrust said, "I never heard him say no."“ AAS ($)

CITY HALL

~ “New ruling clears the way for public comment at City Council work sessions,” Austin Monitor’s Elizabeth Pagano – “Thursday morning, Mayor Kirk Watson kicked off a planned budget work session in an unusual way. 

“Late yesterday, we received a copy of a court order related to one of the lawsuits and, as a result of that, we are going to allow for public comment this morning,” he said. 

The announcement came hours after a Travis County court ruled in favor of the Save Our Springs Alliance in its suit against the city over open meetings act violations, this time addressing the issue of public comment during work sessions.

Work sessions, which were expanded in scope during former Mayor Steve Adler’s tenure as a way to make regular meetings more efficient, are held on Tuesdays prior to Thursday City Council meetings. During work session, Council hears briefings from staff and discusses – but does not vote on – items on the upcoming agenda. Up until now, there has been no opportunity for the public to comment at work sessions. 

In April, the Save Our Springs Alliance filed suit over City Council’s procedures for allowing the public to speak. SOS won that suit but later sought further clarification on the work session and public speaking rules that were codified by Council.

Wednesday’s ruling by Judge Daniella Deseta Lyttle says that the city must remove a part of the recently passed ordinance that adopted rules and procedures for City Council. The section of the code that must be removed in the next week reads, “These procedures are directory only, and a violation of any of the provisions of this ordinance does not affect the validity or legality of any council action otherwise properly adopted.” 

According to the ruling, that section of the ordinance “does not provide any legal consequence for any noncompliance or conflicts with the City Charter or state law” and essentially served as a loophole that said “it’s an ordinance, but it’s not really enforceable, and we don’t have to follow it,” as SOS Executive Director Bill Bunch put it while speaking to the Austin Monitor.

On the larger issue of public comment at work sessions, Lyttle found that the lack of public participation does not violate the Texas Open Meetings act “so long as the City Council does not engage in any deliberations at any work session meetings” or hold them in a way that meets the definition of “meetings” under state law. This means that Council may not be required to allow the public to speak on briefings, but they do have to let people weigh in when they discuss items that they plan to vote on in the future.

“If they are just doing briefings, that’s fine. But if they cross the line to deliberations, then they have to let people speak at work sessions as well,” Bunch said. “The public gets to have input early enough that it can make a difference. If they are all figuring out what they are going to do on Tuesday, and the Thursday vote just kind of becomes pro forma …  just letting people speak on Thursday is too late. Minds are already made up.”

“It’s unfortunate that we, or somebody else, has to sue them to follow the open meetings law and to let people be heard on public business,” he continued. “Anyway, it’s done for now.”

A city spokesperson responded to a request for comment on the ruling to the Monitor, saying, “We appreciate the guidance provided by the Court. The City believes it was in compliance with the Texas Open Meetings Act and strives to remain in compliance.”” Austin Monitor

BUSINESS NEWS

~ “Another billion-dollar data center project planned for the Austin metro,” Austin Business Journal’s Justin Sayers – “What might ultimately be a $1 billion data center development is planned for 52 acres on the east side of Taylor.

It's another high tech score for a rural Texas suburb growing fast thanks to Samsung's new factory, and it further solidifies the Austin area's status as an emerging hub for data centers.

Austin-based Blueprint Projects won unanimous approval from the Taylor City Council on Aug. 8 for incentives. The data center it plans to build would be on land owned by the Taylor Economic Development Corp. at 1601 Martin Luther King Jr. Drive, near where a 212-acre industrial campus is planned.

The company is expected to start construction by July 1 next year, officials said. Each phase of the three-phase project is planned to be 45,000 square feet, meaning it would be 135,000 square feet at full-buildout. The project is expected to reach $1 billion of capital expenditure over the next 10 years in both real and personal property, based on the replacement schedule of servers and other equipment planned it.

The agreement was made with BPP Projects LLC, which is linked in public records to Blueprint Projects. The company bills itself as "a disruption focused developer of high-performance-compute ready data centers in the U.S.," according to its website. The company last year was raising $50 million for a 10 megawatt data center that is artificial intelligence ready. Its founder and CEO is listed as Yaerid Jacob.

“We are honored and grateful to be partnering with the TEDC and the City of Taylor and to have been awarded incentives to build our data center in Taylor, Texas," its senior management team said in a statement, adding that they "look forward to supporting the city's rapid & exceptional growth story.”

The incentives agreements — codenamed "Project Sam" in economic development discussions — require the company to commit to a minimum capital investment of $225 million and five jobs, according to an announcement. In return, the city will provide a 10-year, 50% rebate of taxes on the tangible property inside the development for each phase of construction. A separate agreement with the city and TEDC provides a 50% rebate of the local use tax collected on materials used for construction.

Mayor Dwayne Ariola lauded the project as a way to diversify the tax base in Taylor, which is located about 35 miles northeast of downtown Austin and has a population of about 17,300 people. The city is primed to grow thanks to construction of a massive Samsung Electronics Co. Ltd. factory, as well as the relocation of several of its suppliers to the city.

"Projects like these grow our local tax base and are a huge win for the City, County and School District," Betty Day, chair of the TEDC's board of directors, said in a statement.

The company committed to "maintain and deliver a well-represented workforce," by working with a local recruiting agency, hosting a job fair and connecting with the Texas Workforce Commission to target minority job applications and residents of the city, according to the announcement. The company also will join the Taylor Chamber of Commerce.

Data centers are massive hubs for computer processing power — commonly called "the cloud" — that are used by many companies and industries. While they don't create many long-term jobs, they do add value to a city's tax rolls because of the large amount of investment at the sites. But the U.S. data center boom has drawn criticism based on a variety of factors, such as the amount of power and water the facilities use.” ABJ ($)

~ “Family of man who died electrocuted at Tesla factory sues for $1 million,” CBS Austin’s Stephanie Becerra – “The family of a man who died while working at Tesla's Gigafactory in Austin is suing the company and asking for $1 million in damages.

The suit claims Victor Joe Gomez Sr.'s death on August 1, 2024, was due to electrocution. He was reportedly an employee with Belcan and contracted to work with Tesla.

The lawsuit claims Gomez was told to inspect electrical panels before they were energized. However, one of the panels already had power and immediately electrocuted him, leaving him unconscious.

Representatives for the Gomez family say they've hired experts to inspect the property before any evidence is repaired or altered, but have yet to hear from Tesla.

CBS Austin has reached out to both Tesla and Belcan for a statement but has yet to hear back.

OSHA is investigating Gomez's death.” CBS Austin

~ “Years after FBI raid, what does Nate Paul’s World Class Holdings still own,” Austin Business Journal’s Cody Baird – “Nate Paul’s real estate empire has dwindled over the past several years, but the embattled investor still lords over a portfolio brimming with high-profile properties rich with development opportunities.

World Class Holdings, Paul’s investment and development firm, has lost dozens of properties since a 2019 FBI raid on its offices helped trigger a landslide of lawsuits, bankruptcies and foreclosures that the formerly high-flying firm is still contending with five years later. Even though Paul faces jail time for wire fraud, World Class still possesses at least 18 properties within Travis County appraised at around $297 million, according to property records.

The nearly three dozen properties World Class has lost over the years — at least those that could be tracked by the Austin Business Journal — were most recently appraised for at least $322.7 million. Translation: When it comes to land value in his hometown, it appears Paul has lost a little more than half of it.

Paul did not respond to multiple requests for comment.

He also stands accused of lying to financial institutions to obtain $172 million in loans between March 2017 and April 2018, but he has consistently fought the accusations in courts and labeled its coverage "fake news."

While the World Class portfolio has lost several gems, including the former campus of industrial conglomerate 3M Corp. — which was bought by California-based Karlin Real Estate LLC and has since transformed into a sprawling 1.1 million-square-foot life sciences campus called Highpoint 2222 — there are still several diamonds within it.

By combing through property records, we've assembled a list of dozens of current and former World Class properties within Travis County and placed them on a map as a visual aid. This list and map may not be comprehensive because property ownership records can get cloudy. Dollar values shown are current appraised values and do not represent what Paul paid for them or their potential values if redeveloped.” ABJ ($)

OTHER NEWS

~ “Texas back-to-school sales tax holiday weekend is here,” CBS Austin’s Fred Cantu – “If you've put off your back-to-school shopping, for once your procrastination may pay off. On Friday, Texas kicks off its three-day sales tax holiday on back to school items. No sales tax means you'll save about eight dollars on every hundred dollars you spend through Sunday. And you are likely to spend hundreds.

The National Retailers Federation expects families with school age children to spend $875 this year on their back-to-school shopping. That means a family spending the full $875 dollars would save $70 in sales tax.

Kevin Lyons with the Texas Comptroller’s Office says, “Obviously with inflation and people trying to stretch every dollar, this kind of holiday lets you do that. So, you buy the things that you need for your children, for your loved ones and for yourself so you can save that tax that's applied. You can save that money."

Retailers say school supplies actually make up only about 20% percent of a family's back to school purchases. But luckily, the Texas Sales Tax Holiday also covers clothing, shoes and backpacks as long as you don't go crazy. The rules for the sales tax holiday says the qualifying item can't cost more than $100. So high-dollar high-tops will have to pay the full sales tax.

And please note this is a TEXAS sales tax holiday. If you're shopping in person in Texas, no problem. But if you're shopping online, you have to buy from an online retailer doing business in Texas in order to enjoy the sales tax saving.

There are always rules. Click here for the particulars.” CBS Austin

~ “Austin massage parlor license suspended amid human trafficking allegations,” CBS Austin’s Tara Brolley – “The license of a southwest Austin massage parlor has been suspended following human trafficking allegations against its owner, according to the Texas Department of Licensing and Regulation.

Lu Juqing, 48, was arrested Monday and charged with two counts of trafficking persons, a second-degree felony. She's accused of coercing women to provide sexual services at RS Foot Massage on Highway 290 in the Oak Hill area.

According to TDLR, the business has been licensed since 2019.

"TDLR issued a six-month emergency closure order to RS Foot Massage on August 6, 2024," a TDLR spokesperson told CBS Austin. "Investigators for the Austin Police Department (APD) requested that TDLR issue an emergency order closing the establishment after they initiated a human trafficking investigation at the location."

An arrest affidavit said police executed a search warrant following an email tip from one of the victims. The women, identified only as Victim 1 and Victim 2, told investigators they were recruited from China and expected to perform only massages.

The victims reported being confined to the business 24 hours a day and alleged Lu took their passports and threatened deportation if they didn't comply with her demands.

Lu is being held in Travis County Jail on a $200,000 bond.” CBS Austin

SPORTS

~ TEXAS FOOTBALL: “Jaydon Blue may be the next man up, but who else could be a factor in the Texas backfield,” Austin American-Statesman’s Danny Davis — “At the running back position, injuries are nothing new.

Texas knows this. When Chris Warren III went down in 2016, D'Onta Foreman turned a timeshare into a Doak Walker Award. Roschon Johnson finished the 2021 season strong after Bijan Robinson suffered a season-ending elbow injury. And Jonathon Brooks stepped up when CJ Baxter was injured last season, and then Baxter stepped up when Brooks was lost in November.

So when Texas announced Wednesday that Baxter, the presumed starter, would have season-ending knee surgery, attention quickly shifted to the Longhorns' contingency plan. This time, Jaydon Blue appears to be the next man up. The junior has only 80 carries on his college résumé, but he played well down the stretch last season after Brooks' knee injury and recently joined Baxter on the preseason watch list for the Doak Walker.

But after Blue, who else is on the depth chart?

Wisner looks like the new No. 2

What about sophomore Quintrevion Wisner? He was mostly used on special teams last season, but he impressed coaches with how he handled those responsibilities, and he did score on one of his 12 rushing attempts. As a senior at DeSoto High in 2022, he averaged 6.8 yards per carry and won a state championship alongside UT receiver Johntay Cook II.

"Tre's a baller. We saw the physicality that Tre possessed last year on special teams. He was a demon on special teams for us last year," said UT coach Steve Sarkisian, who described Wisner on Thursday as physical, fast and versatile. "That was a deep running back room that he was sitting in with Jonathon and Keilan (Robinson) and then (Baxter) and Jaydon. When you're sitting there as the fifth back, and then we had Savion (Red) even at wildcat; he didn't maybe get as many carries in-game, but we saw what he could do at practice."

Keep an eye on two UT freshmen

Texas signed two four-star running backs in its 2024 recruiting class. While attending the IMG Academy in Florida, Jerrick Gibson was viewed as a top-10 national running back prospect. And Sarkisian has previously said that Christian Clark reminds him slightly of Robinson, who also was signed out of Arizona.

"Both of them are physical players," Sarkisian said. "Jerrick is a workhorse. He is a very hard-nosed runner, tough. Christian's got great one-cut ability. Both catch the ball out of the backfield."“ AAS ($)

In a position room coached by former NFL running back Tashard Choice, UT has several walk-ons, such as Colin Page, who once starred at Anderson High in Austin, and Nik Sanders, who also plays baseball at Texas. The Longhorns could add to the depth in their backfield by asking someone to switch positions.

It wasn't too long ago that Johnson was a four-star quarterback, and he evolved into a running back and an eventual fourth-round draft pick at that position. Current UT linebacker David Gbenda had a short stint as a running back when the depth there was depleted his freshman year. Red, who recently transferred to Nevada, arrived at Texas as a receiver but made his biggest impact as a rushing option.

Johnson and Gbenda's shifts into the backfield were made under former UT coach Tom Herman, but Red changed positions under Sarkisian, who didn't dismiss the idea of scouting his own roster for potential running backs but did say that he first wants to see his players get reps at their current positions.

"As of right now, I feel really good about the four (scholarship) guys that we have," he said. "To be fair to the rest of the guys on the roster, I kind of want to get them through this first scrimmage. They've been working a position to give them a chance to play in this first scrimmage. We'll assess as the staff on Sunday when we evaluate the entire roster if that's something that we may do."

Looking toward the first scrimmage

On Thursday, Sarkisian didn't divulge too many details about Saturday's closed scrimmage at Royal-Memorial Stadium. All of the Longhorns will get a chance to play, though.

"It's going to be a great opportunity for guys to play," Sarkisian said. "What I want to see is what do they know. Again, the coaches aren't on the field; everybody's off. They have to get the call; they have to communicate the call; they have to work together. How do they play when they get a little bit fatigued? It's not going to be so much of a test of maybe the ones — the installation is what it is — but I want to learn about our twos and our threes and even some fours of how they respond and playing in DKR in a scrimmage-type setting."

AUSTIN CULTURE

~ DINING: “Austin’s 23 Iconic Meat Dishes” Austin Eater

WHAT TO DO THIS WEEKEND

Fri

~ LIVE MUSIC: The Gaslight Anthem with Joyce Manor and The Dirty Nil. Stubbs Amphitheater. Doors 6pm. Very few tix remain here.

~ COMEDY: Sebastian Maniscalco with Pete Correale and Pat Mcgann. Moody Center. Doors 6:30pm. Show 7:30pm. Tix $49.50 and up. Tix here.

Sat

~ LIVE MUSIC: Vallejo with Brittany Lobas. Antone’s. Doors at 7pm. Show at 8pm. Tix $15 here.

~ COMEDY: Heather McDonald. Paramount Theater. Doors at 6pm. Show at 7pm. Tix $25 and up here.

COOL JOB ALERT

~ GOVERNMENT AFFAIRS DIRECTOR: Texas Land Title Association (Austin, TX). Salary: Competitive. Info / apply here.