Tuesday PM June 5th, 2007

Houston growth approach lauded by Joel Kotkin in urban report...Airline industry raising fares again...TXU Energy Retail to pay $5 million settlement to allegations it signed one-year contracts without customer consent...

Houston is one of five U.S. cities offering the most compelling model for urban greatness, according to a study by Joel Kotkin called "Opportunity Urbanism: An Emerging Paradigm for the 21st Century." Kotkin says cities like Houston will be successful because they are approaching the future with a mind to providing broad-based opportunities for the masses, rather than simply catering to the elite.

"Many of the cities that had been held as being the hip, cool cities were losing populations, losing jobs." Ed: "Which cities?" "Well, let's say Boston, San Francisco—a good start—were relatively stagnant, even through the recovery. And that they were actually losing educated people—net--and particularly younger ones. At the other hand, places like Houston, Phoenix, Atlanta, were gaining quite strongly. So what we think is the predominant lure for educated workers, which is hip, cool inner city life, exists only basically to people in their 30's. And you know what? Most of us intend to live a lot longer than that, and most of us will probably have to work a lot longer than that. So cities that could not only attract these people but keep them there, or keep attracting people like that, are in very good shape, and Houston right now is in a particularly strong situation because it's got a very, very strong economy. This is really a kind of greatest opportunity that Houston's had in 20 years, to really push the envelope to another level."

The study provides a counterpoint to the current assumptions that focus primarily on luring affluent, well-educated "creative elites" as the key to a successful urban strategy. Kotkin spoke at a Greater Houston Partnership event.


The airline industry is raising fares again. Farecompare.com says Houston-based Continental Airlines increased the price of a one-way ticket in 30 percent of the top U.S. markets by $5 for advance-purchase and $10 for last-minute seats. The airfare tracking Web site says that prompted Fort Worth-based American Airlines--along with Delta, Northwest, United and U.S. Airways--to match on overlapping routes, as well on some routes out of hub airports. It's the industry's fifth or sixth attempt to increase fares this year. And if it succeeds, it would be the year's first to stick. Prior attempts unraveled within a week after low-cost carriers refused to join in.

JPMorgan cut its estimates for Houston-based Continental Airlines after its report that revenue per available seat for May fell about one percent. That revenue is a gauge used to determine how much money they take based on miles paying passengers fly.

Domestic airlines report only 72.5 percent of flights were on time through April—the worst rate since the federal government began compiling figures in the current format in 1995. Bloomberg says the 20 largest carriers coped with storms and a traffic surge, causing delays. Flights are considered on time if they are within 15 minutes of the scheduled arrival.


TXU Energy Retail reportedly has agreed to pay a $5 million settlement to the State Public Utility Commission. The Houston Chronicle cites PUC filings in reporting the Dallas-based electric utility has agreed to pay the record settlement. The deal would settle allegations that TXU signed one-year contracts with customers who hadn't explicitly consented to them. The PUC documents show TXU sent notices to about 4,000 small commercial customers whose contracts were about to expire. They were told the contracts would be renewed for 12 months unless they said otherwise. State law requires that any service renewed automatically can't be for more than 31 days. TXU spokeswoman Lisa Singleton told the Chronicle that TXU still disagrees with the PUC's interpretation of the law. But the utility decided to settle anyway without admitting or denying fault.


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