Texas .Business .Review 
September 1977 

Vol. LI, No. 9, September 1977 193 Texas and OPEC: A Case of Economic Interdependence, 
Texas 
Business 

Review 
Published by the Bureau of Business Research, University of Texas at Austin Charles C. Holt, Director Lorna Monti, Associate Director 
The Authors Hossein Askari 
Associate Professor ofInterna­tional Business University of Texas at Austin 
James Creasey 
Teaching Assistant Department ofMarketing University of Texas at Austin 
Marian Blissett 
Associate Professor Lyndon B. Johnson School of Public Affairs University of Texas at Austin 
Charles P. Zlatkovich 
Research Associate Bureau of Business Research 
Carol T .F. Bennett 
Research Associate Bureau of Business Research 
Susanne Ethridge Cannon 
Teaching Assistant Department of Real Estate and Finance University of Texas at Austin 
Cover: Lower Rio Grande Valley agri­culture, photograph courtesy of Charles P. Zlatkoyich. 
Lewis J. Spellman, Editor Lois Glenn, Publications Manager Barbara D. Terrell, Managing Editor Mildred Anderson, Kay Davis, Marylyn 
Donaldson, and Joan Holloway, Data 
Compilation Daniel P. Rosas, Printing Coordinator Joan Farnham, Compositor James R. Buchanan, Graphic Artist 

Hossein Askari and James Creasey 
197 Implementing the Energy Policy and Conservation Act in Texas, Marian Blissett 
204 The Lower Rio Grande Valley: An Area of Rapid Growth, Charles P. Zlatkovich and Carol T.F. Bennett 
210 Texas Construction, Susanne Ethridge Cannon 
Tables 

194 State Energy Tax Revenues and Total State Revenues 
194 Estimates of Royalty Payments for Texas Oil and Gas Production 
195 Estimates of Texas Exports to OPEC 
196 U.S. Exports to OPEC 
199 Texas Energy Consumption by Sector, 1975 
200 Projected Energy Consumption in Texas by Sector, 1976-1980 
200 Estimated 1980 Energy Savings from Application of Mandatory Thermal Standards in New and Renovated Buildings in Texas 201 Suggested Interior Illumination Levels 202 Estimated 1980 Energy Savings from Mandatory Lighting Efficiency Standards in New Public Buildings in Texas 
202 Energy Consumption by All State Agencies in Texas for Selected Items 
203 Selected Industry Target Groups for Voluntary Energy Conservation in Texas 203 Estimated 1980 Savings and Costs of Mandatory and Optional Program Measures in the State Energy Conservation Plan 
206 Percentage of Personal Income by Major Sources, Brownsville­Harlingen-San Benito and McAllen-Pharr-Edinburg SMSAs and Texas,1975 207 Nonagricultural Civilian Payroll Employment Percentages, Brownsville­Harlingen-San Benito and McAllen-Pharr-Edinburg SMSAs and United States, March 1977 
208 Manufacturing Plants with More Than 250 Employees, Brownsville­Harlingen-San Benito and McAllen-Pharr-Edinburg SMSAs, 1976 
211 Estimated Values of Building Authorized in Texas 
211 Dwelling Unit Construction in Selected SMSAs, 1972-1977 
212 Local Business Conditions 
213 Selected Barometers of Texas Business 214 Gross Retail Sales by Kind of Business for Texas Standard Metropolitan Statistical Areas Barometers of Texas Business (inside back cover) 
Charts 208 Age Profile for Brownsville-Harlingen-San Benito and McA!len-Pharr­Edinburg SMSAs and Texas 208 Effective Buying Income Profile for Brownsville-Harlingen-San Benito and McAllen-Pharr-Edinburg SMSAs and Texas 
Subscription rate: $5.00 per year. Single copy: $.50. Address requests to Publications Office, Bureau of Business Research, 
P.O. Box 7459, Austin, Texas 78712. Second-class postage paid at Austin, Texas. Publication number 540-400. 
Contents of , this publication not copyrighted and may be reproduced freely. Acknowledgment of the source will be appreciated. 
Texas Business Review is indexed in Marketing Information Guide and Public Affairs Information Service and is available on microfilm from University Microfilms. 
The Bureau of Business Research is a member of the Association for University Business and Economic Research. 

Texas and OPEC 


A Case of Economic lnterpendence 

The dramatic oil price increases of 1973-1974 have had a substantive adverse economic effect on much of the world, with the possible exception of Texas and a few other oil-producing areas in the United States. For Texas, oil price increases set by the Organization of Petroleum Exporting Countries (OPEC) have directly resulted in higher employment levels and higher tax revenues and have indirectly stimulated economic activity through exports and inflows of capital. For most of the world, the higher prices set by OPEC aggravated inflationary conditions in all oil-importing nations, deteriorated significantly their bal­ance of payments positions, and reduced the level of disposable incomes at a time when worldwide recession was already in progress. It has been estimated by the Interna­tional Monetary Fund (IMF) that increased energy prices were responsible for an inflationary impact of between 2.5 and 3.5 percent for most industrialized countries, an impact that was somewhat lower for the United States (1.5 percent) and a little higher for Japan ( 4.0 percent) and Italy 
(5.5 percent). I Furthermore, because of a lack of an immediate substitute, oil usage declined very little and thus the price increases reduced the level of disposable income available for non-oil purchases and contributed to the recent slowdown in economic growth. 
Hossein Askari 
Ja 1n es C reas e) 


These adverse effects are unquestioned, with the only debate being the relative impact on individual countries. It became apparent after the initial price increases that some countries would suffer more than others, depending on the proportion of imports of oil relative to domestic produc­tion. To make matters worse, the more dependent coun­tries, with larger trade deficits brought about by higher oil prices, are forced to bridge the gap in their balance of payments with products whose production costs have increased (due to these prices) relative to those produced in countries whose oil dependency is less pronounced. 
The issue, therefore, has been, "Who is hurt more or less relative to other nations?" Because of this focus, little attention has been paid to the possible beneficiaries of this alignment of petroleum exporters. It may seem unlikely that any industrialized nation or region outside of OPEC could actually flourish under the conditions described, but Texas has managed to do just that. 
While the United States has on balance been adversely affected by the unilateral pricing policies of OPEC, these effects have been neither uniformly distributed among the states nor unidirectional. Some states, Texas in particular, have benefited both directly and intlirectly from the higher price of oil. 
Table 1 
State Energy Tax Revenues and Total State Revenues (Millions of dollars) 
Fiscal year  Production  Production  Special  Motor  Oil and gas  Total  
ending  and regulatio n  and regula lion  motor  fuel  well servicing  state  
August 31  tax, crude oil  tax, natural gas  fuel tax  tax  tax  Total  revenues•  

1970  172  96  27  258  0  553  2219  
1971  194  108  31  302  0  635  2454  
1972  193  114  35  320  1  663  2858  
1973  209  134  41  343  1  718  3150  
1974  347  171  46  343  1  908  3716  
1975  404  259  45  350  2  1060  4151  
1976  431  364  51  376  2  1224  4816  

•Excludes federal grants. 
Source : Comptroller of Public Accounts, Annual Financial Report of the State of Texas, annual volumes. 

A general indicator of the degree to which Texas has benefited can be found in the unemployment trends of the 1970-1976 period. Texas unemployment rose from 3.7 percent in 1970 (the base year) to a high of 5.6 percent in 1975, while the corresponding figures for the United States were 4.9 and 8.5 percent respectively. At the height of the recession Texas unemployment was 2.9 percent below the national average and only 2.6 percent above the lowest unemployment level, which occurred during the economic boom period in 19 73. 2 
Admittedly, Texas was less affected than other states during the economic slowdown for reasons other than the stimulus provided by OPEC. However, OPEC and oil, the two being inextricably linked, are a major determinant of economic growth in Texas. They not only provide a direct infusion of dollars as an economic stimulus through higher oil prices but also affect the state's economy indirectly. 
In Texas the most obvious direct effect of the higher world price for oil has been the reevaluation of its oil and gas reserves. Although federal price controls prevented the wellhead value of Texas oil from reaching the world market price, the wellhead price of Texas oil still increased from an average in 1970 of $3.28 per barrel to $8.02 per barrel in 1976.3 World prices of oil during this same period ranged from $1.80 per barrel to the current price of $12.38 per barrel. Since the state tax on oil and gas production is an ad valorem tax, these higher prices have resulted in additional revenues to the state of Texas. The additional revenues resulting from the production tax levied on the wellhead value of oil and gas, although considerably below what uncontrolled domestic prices would have produced, have been substantial. Energy tax revenues rose from $553 million in 1970 to $ l ,224 million by 1976, amounting to 
25.4 percent of the state's entire 1976 revenues (see table 1). Royalty payments from oil and gas production also increased from $672 million in 1970 to $1,867 million in 1976, or an increase of $1.2 billion (see table 2).4 
In conjunction with the price increases has come an increased effort on the part of oil producers in the state to locate and retrieve greater quantities of oil and natural gas; in 1976, 13,884 wells were drilled in Texas whereas only 8,031 were drilled in 1973.5 Because of this, energy industry employment in Texas has risen by 25.0 percent since 1970. A total of 45.4 thousand jobs have been thus created.6 If the prices of oil and natural gas were allowed to move toward the world price set by OPEC either through adjustments at intervals to the price ceiling or through decontrol of prices, the Texas economy would be even further stimulated. 
The indirect effects of OPEC action on Texas have also been substantial. First, Texas has been a recipient of the increased spending on imports by the OPEC countries. Exports through the Houston Customs Region increased 206 percent between 1970 and 1976, against 166 percent for the United States overall. This difference in growth is attributable in large part to the role Texas plays as one of the major U.S. exporters to the OPEC nations. Export trade through the Houston Customs Region to these nations increased by nearly $2 billion over this period-an increase of nearly 440 percent (table 3).7 A further indicator of the degree of interdependence of the Texas economy and OPEC is the fact that this trade currently accounts for 20 percent of all exports flowing through the Houston Customs Region, a figure that reflects a much larger share of trade with OPEC than the 10.9 percent national average (see table 4 ). Another interesting point that can be drawn from tables 3 and 4 is that by 1976 exports to OPEC through the Houston Customs Region constituted almost 20 percent of all the U.S. exports to that block of nations. It is evident then that not only is the economy of Texas influenced by OPEC through its effect upon domestic oil 
Table 2 
Estimates of Royalty Payments for Texas 
Oil and Gas Production 
(Millions of U.S. dollars) 
Year Total amount Natural gas Crude oil 
1970  672  160  512  
1971  712  180  532  
1972  751  185  566  
1973  873  229  644  
1974  1443  347  1096  
1975  1674  507  1167  
1976  1867  674  1193  

Source: Estimated from total wellhead value of annual natural gas and crude oil production in Texas. Estimates were based on 12.5 percent of wellhead value of oil and gas production. 
Texas imports 14.6  
15.9  + 15.2 ......... 13.950Texas energy production  
5.6  8.843 Texas energy consumption l  


Estimates of Texas Exports* to OPEC  
(Millions of dollars)  
Coun try  1970  19 71  1972  1973  1974  1975  1976  
Iraq  3.0  4.1  3.4  9.3  48.7  47.4  s l.2  
Iran  44.8  6 1.6  81.8  128.1  296.4  495.6  371.8  
Kuwait  8.5  10.6  16.2  19.7  35.7  55 .9  63.2  
Saudi Arabia  19.4  2 1.0  46.0  73.3  142.7  229.6  37 1. S  
Qatar  2 .0  3.2  5.8  7.6  10 .6  
U.A.E.  10.1  20. 1  39. 3  56.9  56.9  
Indo nesia  35 .S  39.6  4 5.6  58.9  65.2  77.6  85 .9  
Vene zuela  2 4 8.1  257.6  307.2  399.S  645.S  856.2  992 .4  
Ecuad or  41.S  4 3.9  44.S  6 6.9  119.0  I 58.0  I 57. 1  
Algeria  10 .9  14.0  17.4  34.8  83.8  127.4  89.9  
Libya  19.0  13.4  IS.I  22.4  37.0  46.8  S I. I  
Nigeria  22.7  28.8  20.4  34 .8  76. 1  108. 1  142.1  
Gabo n  1.2  1.0  2.3  4.1  8 .8  11.9  8 .5  
Texas expo r t  
to tal  454.6  495.6  612.0  875.1  1604.0  2279.0  2452.2  

Figure 1 
30 
20 
~ 
f­<Il 10 
0 1970 1985 2000 
Note Figures based on domestic prices of (a) oil $8.65/barrel. (b) gas S.66 MCF. Import prices based on oil S 14 .OD/barrel 
Source· Miiton L. Holloway, Herbert W Grubb, and W Larry Grossman. An Economic Analysis of Declining Petroleum Supplies in Texas· Income, Employment, Tax, and Production Effects as Measured by /nput·Output and Supply-Demand Simulation Models, State of Texas, Governor's Energy 
Advisory Council Final Report (Austin, February 1975) 
prices and thus upon state revenues, but the economy is also stimulated through increased export demand. 
The second indirect effect of OPEC oil price increases has been the expansion of demand for oil-related equip­ment as a result of increases in drilling activity. Again, the economic base of Texas has benefited from this surge in demand. This impact is only partially captured in the rapid increase of Texas exports because domestic demand for such products has also increased. 
Third, given the increasing economic prominence of the "Sun Belt" and the special relationship between Texas and OPEC countries, the inflow of capital to Texas, both domestic and international-particularly from OPEC-has been or will be increased.8 
The total effect of all these economic stimuli on the Texas economy is only partially accounted for by the above facts. A multiplier effect also occurs. That is, a portion of 

Table 3 
Figure 2 
10 9 
;: 

g 
"'

a. 0 
~ 
c: .2 
~ 

3.434
3 
2 
OL-~~--''--~~--'~~~--'~~~-L~~~-'-~~~~ 
1970 1985 2000 
Source: Miiton L. Holloway, Herbert W Grubb, and W Larry Grossman, An 
Economic Analysis of Declining Petroleum Supplies in Texas. Income. Employment, Tax, and Production Effects as Measured by /nput·Ourput and Supply-Demand Simulation Models, State of Texas. Governor's Energy Advisory Council Final Report !Austin, February 19751. 
each dollar increase in any one person's disposable income becomes an addition to another's income when a portion of the dollar is spent. 
An example of this multiplier effect in the Texas economy is clearly shown in the projections of the Governor's Energy Advisory Council.9 Demand multipliers were estimated for several industrial categories. The total projected effects on the demand for these products (as shown in figures 1, 2, and 3) are far more pronounced than would be obtained from the direct effects alone, that is, if these multipliers and interdependencies were not taken into account. 
It is clear that oil production has provided a stimulus to the Texas economy. However, care must be taken that 

*Houston Customs Region. Source: U.S. Departm ent of Commerce, Bureau of the Census, Highlights of U.S. Export and Import Trade, December issues, 1970-1976. 
SEPTEMBER 1977 
Figure 3 
130 
110 
101 .326 
~ ~ 
..!!! 
0 
"'O 
.... 
0 
~ 
c: 
.Q 
to 
2  .685  Oil  and  gas industry 1.334  taxes  1.448  
0 '970  1985  2000  

Source: Milton L. Holloway, Herbert W. Grubb, and W. Larry Grossman, An Economic Analysis of Declining Petroleum Supplies in Texas: Income, Employment, Tax, and Production Effects as Measured by Input-Output and Supply-Demand Simulation Models, State of Texas, Governor's Energy 
Advisory Council Final Report (Austin, February 1975). 
current oil production provide a future economic base for the day when oil reserves are depleted. 
In this sense Texas finds itself in a situation very similar to the one that stirred the OPEC nations to action. Its unreplenishable natural resources are being rapidly depleted at prices set unrealistically below the world price level. The current price level of domestic oil, although below world market price, is, however, considerably higher than levels previous to the 1973-1974 OPEC price hikes. These higher prices have allowed Texas to capture, in part, a more reasonable economic return on its natural resources, but the fact remains that once these revenues are lost through low prices, the lost revenues can never be compensated-that is, the oil sold at the lower yield cannot be regenerated or replenished. It is gone forever. 

The importance of obtaining a fair return for natural resources is most acutely evident when the need for economic diversification is considered. Reserves of oil and gas in Texas are both unreplenishable and finite. The day will come when these energy revenues will no longer provide the basis for the economic activity that currently exists. An infrastructure founded on non-oil related indus­tries must be built now, while the resources are available. Incentives should be initiated to attract to this area industry that will provide future jobs and economic growth for the state when the energy revenues diminish to insignificance. 
In its need to evolve a more diversified infrastructure, Texas again finds itself in a position similar to that of the OPEC nations, with the difference being only one of degree. While the initiative should be taken to attract an oil-independent industrial base, it is not so imperative in Texas because of the considerable industrialization relative to OPEC and the fact that market forces are currently operating in Texas' favor. Industrial growth and population growth in Texas are far outstripping projections, in part because of the relatively light tax burden-a direct result of the increased revenues from oil and gas production. But tax incentives alone are not sufficient to build the infrastruc­ture necessary to replace the massive oil and gas industry in the Texas economy. 
Also it must be realized that if the wellhead tax on oil and gas production is allowed to remain fixed at its current level, revenues become determined by the price ceiling set by the federal government and the volume of production, which is dependent upon that price. Therefore, revenues are lost both because of lower prices per unit of production and because of the lower production levels set by that low price. This prevents Texas from raising enough revenues from its natural resources to both keep pace with its normal 

Table 4 
U.S. Exports to OPEC (Millions of dollars) 
Country 1970 1971 1972 1973 1974 1975 1976 
Iraq  22  32  23  56  285  310  382  
Iran  326  482  559  772  1734  3242  2776  
Kuwait  62  83  111  119  209  366  472  
Saudi Arabia  141  164  314  442  835  1502  2774  
Qatar  14  19  34  so  79  
U.A.E.  69  121  230  372  425  
Indonesia  266  263  308  442  531  810  1036  
Venezuela  759  787  924  1033  1768  2243  2728  
Ecuador  127  134  134  173  326  414  4 16  
Algeria  62  82  98  161  315  632  487  
Libya  108  78  85  104  139  2 32  277  
Nigeria  129  168  11 5  161  286  536  770  
Gabon  7  6  13  19  33  59  46  
Total  2009  2279  2767  3622  672 5  10768  125 68  

state expenditures and initiate a system of incentives to attract the economic base necessary for its future. 
The most viable alternative in this dilemma, since the pressure Texas can put on domestic oil prices is restricted by the influence of the other states, is to increase revenues by raising the 4.6 percent wellhead tax rate. This would provide Texas with more control over the economic revenues generated from these diminishing resources and would provide the necessary revenues for building the future infrastructure for the Texas economy. Texas has reaped considerable benefits from the pricing strategy set by OPEC, but it is now time for this passive role to end. Effective revenue-producing measures must be taken to ensure adequate return on the unreplenishable natural resources before they are exhausted. 
Notes 
1. International Monetary Fund (IMF), Annual Report of the International Monetary Fund, 1975, p. 9. 
2. U.S. Department of Labor, Bureau of Labor Statistics, Hand­book of Labor Statistics. Texas data from Texas Employment Commission in cooperation with the U.S. Bureau of Labor Statistics, Labor Force Estimates, Texas (annual issue). 
3. 
U.S. Department of Interior, Bureau of Mines, Minerals Year­book (annual volumes). 

4. 
This impact, if anything, is an underestimate since, in the absence of the oil price increase, oil and gas production would have declined substantially, leading to a possible decline in such revenues. 

5. 
Texas Railroad Commission, Annual Report of the Oil and Gas Division (annual volumes) ; and American Petroleum Institute, Petroleum Facts and Figures, 1971. 

6. 
Texas Employment Commission in cooperation with U.S. Bureau of Labor Statistics, Population and Labor Force Estimates for Texas, 1950-1972, plus updates for 1973-1976 and Labor Force Estimates, Texas (annual issues). 

7. 
Unfortunately, export data by country of destination for the United States and each of its customs regions are not published. However, data are available for groupings of countries so that the authors were able to construct these estimates. For example, Saudi Arabia accounted for 30.0 percent of the export trade from the United States to the Near East Asia group. It was then assumed that exports from the Houston Customs Region destined for Near East Asia would contain the same ratio vis-a-vis Saudi Arabia. Table 3 was generated by repeating this procedure for each OPEC member. 

8. 
Unfortunately, reliable information for this capital inflow is unavailable. 

9. 
Milton L. Holloway, Herbert W. Grubb, and W. Larry Grossman, 


An Economic Analysis of Declining Petroleum Supplies in Texas: Income, Employment, Tax, and Production Effects as Measured by Input-Output and Supply-Demand Simulation Models, State of Texas, Governor's Energy Advisory Council Final Report (Austin, February 1975). 



Implementing the Energy Policy 

•


and Conservation Act Ill Texas 
The Arab oil embargo of 1973 illustrated dramatically the effects of temporary energy shortages in the United States. And the fuel curtailments and power failures in the winter and summer of 1977 have once again raised serious questions about our long-term ability to meet growing energy demands. Most policymakers agree that these events, 
I wish to thank the Lyndon B. Johnson Foundation for a faculty development grant that made part of this research possible. 

:\larlan Bliss(•tl 
and others, point to the need to increase energy production and decrease energy consumption. Yet the proper balance between production and consumption is the object of widespread disagreement. 
At the center of debate is concern over the role of energy conservation in economic growth. President Carter's National Energy Plan looks upon conservation measures as the cleanest and cheapest substitute for new sources of energy, but the plan contains no analysis of whether the costs of implementation will equal or exceed the costs of 
energy saved. Such a comparison is difficult to make, but an assessment of state government responses to the federal Energy Policy and Conservation Act of 1975 (EPCA) provides a useful starting point. 
The EPCA authorized $150 million over a three-year period (1976 through 1978) to assist states in the develop­ment of an energy conservation plan. The purpose of the legislation was to induce states to reduce projected energy consumption for 1980 (both public and private) by at least 5 percent. To qualify for federal funds for this enterprise each state was required to design a detailed energy conservation program covering five mandatory areas: 
•
Thermal 	efficiency standards and insulation require­ments for all new residential and nonresidential buildings and all renovated buildings designated by the state; 

•
Lighting 	efficiency standards for nonfederal public buildings; 

•
Energy 	efficiency standards and policies for state-local procurement; 

•
Programs to increase the use of carpools, vanpools, and public transportation (with the exception of subsi­dized fares); and 

•
Traffic laws or regulations permitting a right turn on 


red. Optional provisions of a voluntary nature could also be included with state plans, but the legislation did not specify an appropriate mix. 
By the summer of 1977 all fifty states had indicated the feasibility of achieving the conservation goals anticipated by the EPCA. However, the mandatory programs are not expected to result in high levels of energy savings. To make the EPCA effective, states have had to develop optional conservation measures appropriate to their resource bases, their industrial structures, and their energy-consumption requirements. 
Mandatory Programs 
The five programs mandated by EPCA can be subsumed under two larger user categories-transportation and residential/commercial consumption. In 1975, as shown in table I, these two categories accounted for almost 43 percent of the energy consumed in Texas or about 3,015 trillion Btus. By 1980 (see table 2) the projected energy consumption for both categories is 4,088 trillion Btus, although the percentage of total energy expended remains the same. Since each mandatory measure is addressed to specific end-use activities, the amount of energy that can be conserved depends upon the formulation of. a state plan that is not antithetical to existing legal and regulatory requirements. 


Thermal Standards 
In Texas the prospect of energy savings in plans for new and existing structures is greater than in any other mandatory program area. Commercial heating, ventilating, and air conditioning (HV AC) and residential heating/ cooling systems consume 11 percent of the state's energy, or approximately 776 trillion Btus. Since both new con­struction and renovation are regulated by building codes, energy conservation measures must be achieved through code administration. There are four standard codes: the Basic Building Code (Building Officials and Code Adminis­trators, International, Inc.); the National Building Code (National Board of Fire Underwriters); the Southern Stan­dard Building Code (Southern Building Codes Conference); and the Uniform Building Code (International Conference of Building Officials). Recently, several attempts have been made to standardize thermal requirements. The Interna­tional Conference of Building Code Officials and the South­ern Building Codes Conference have added thermal effi­ciency provisions to their model codes, and the Department of Housing and Urban Development has developed a set of minimum property standards that define thermal efficien­cies for federally financed housing. 
From the standpoint of engineering design, the most extensively researched and debated standards for thermal conservation in buildings are those issued by the American Society of Heating, Refrigerating, and Air Conditioning Engineers (ASHRAE). Developed at the request of the National Conference of State Building Codes and Stan­dards, the ASHRAE provisions set minimum standards for thermal insulation and heating efficiencies in new residen­tial and nonresidential structures. Despite state-of-the-art limitations, these standards are quite broad, excluding only those structures whose peak design rate of energy use is less than one watt per square foot of floor space and whose HVAC system is not mechanically operated. 
The guidelines issued by the Federal Energy Administra­tion (FEA) for implementing the Energy Policy and Conser­vation Act require that thermal standards for new residen­tial and nonresidential buildings be at least as stringent as those developed by ASHRAE. For renovated structures, states are free to define "appropriate" standards and to determine which buildings must meet those requirements. 
In formulating an energy conservation plan for Texas, the Governor's Office of Energy Resources! calculated 1980 savings for both new and renovated, residential and nonresidential structures by building type (see table 3). Estimates were made for nine different types, using a three-step procedure. First, direct energy savings were established by type for newly constructed buildings; second, savings for renovated structures were calculated. Finally, the savings in steps one and two were multiplied by the relative efficiency of the fuel (fossil or electricity) used for space heating and air conditioning. The result was a projected savings of only .06 percent of the estimated energy consumption in 1980. 
Neither the creation of thermal standards nor the development of methods for calculating energy savings can alleviate the problem of code enforcement. Building code law derives from the "police power" of a state and, as a matter of custom and convenience, has been delegated to municipal governments, which are not likely to change as a result of the EPCA. In Texas the state legislature has given incorporated cities the authority to include thermal stan­dards in their building codes, but no statewide system of inspection and compliance regulation exists. 
Since few cities have had experience with thermal requirements, the state energy conservation plan proposes that the Governor's Office of Energy Resources examine existing standards and select one code or parts of existing codes for statewide adoption. Instruction in the implemen­tation of thermal standards would then be provided by a series of regional meetings with local building authorities. To ensure equitable treatment, a technical advisory com­mittee, composed of all parties at interest, would be created to advise the Governor's Office of Energy Resources on standard evaluation and enforcement. But no attempts would be made to alter the present pattern of building regulation. 
Lighting Standards 
FEA guidelines provide that mandatory lighting effi­ciency standards be applicable to all public buildings above a certain size, although the size of buildings to be covered is left to the discretion of the state. With respect to new 

Table 1 
public buildings, requirements are that efficiency standards be at least as stringent as those developed by ASHRAE, whose suggested levels of illumination have been established in accordance with the handbook of the Illuminating Engineering Society and are graded by building type and level of task performance (see table 4). As for existing public buildings, the guidelines are sensitive to two con­cerns: first, that in a variety of instances it would be unworkable to impose lighting standards keyed to an illumination-energy ratio ; second , that considerable latitude exists in formulating standards for use in different types of existing structures. In view of these limitations, the guidelines require only that lighting efficiency standards for existing buildings incorporate provisions deemed appropri­ate by the state. 
In 1975 residential and commercial lighting in Texas consumed 3.6 percent of the state's energy, or about 254 trillion Btus. By applying lighting efficiency standards to five types of new buildings (see table 5) and correcting for a 30 percent generating efficiency, the Governor's Office of Energy Resources estimates that the state can save 1.92 trillion Btus-an amount equal to 0.02 percent of the projected 1980 consumption. The proposed method for achieving this reduction is the same as that for implement­ing the thermal requirements. 

Texas Energy Consumption by Sector, 1975 
Industry and agriculture Feedstock Process steam Direct heat Electric drive Electrolytic processes Misc. industrial uses Irrigation Misc. agricultural uses 
Transportation Urban auto Intercity auto Truck Aircraft Train Pipeline Misc. transportation 
Residential and commercial Commercial heating, ventilating, 
and air conditioning 
Residential heating 
Residential cooling 
Misc. residential appliances 
Residential lighting 
Residential hot water 
Commercial lighting 
Residential cooking 
Misc. commercial equipment 
Commercial cooking 
Commercial hot water 

Total 
Trillion Btus 
4 ,0 38 
1,5 36.4 
1,4 79 
7 ,053.4 
Percentage by sector 
30.l 
24.l 
23.8 
13. l 
3.5 
2.1 
l.7 
l.2 
100 .0 
52.3 
22.9 
10.6 
6.9 
3.2 
2.8 
l.3 
100.0 
20.0 
17. l 
15.7 
12.4 
9.0 
8.1 
8.1 
4.3 
2.4 
l.9 
l.O 
100.0 
100.0 
Percentage of total 
17.2 
13.8 
13.6 
7.5 
2.0 
l.2 
l.O 
0.9 
57.2 
l l.4 
5.0 
2.3 
l. 5 
0.7 
0.6 
0.3 
21.8 
4.2 
3.6 
3.3 
2.6 
l.9 
l.
7 

l.
7 


0.9 
0 .5 
0.4 
0.2 
21.0 
100.0 

Table 2 
Projected Energy Consumption in Texas by Sector 1976-1980 
Ind us try and agriculture Trillion Btus 
19 76 4,762.3 
19 77 4,892.9 
1978 5,027.1 
1979 5,165.0 
1980 5,306.7 

Transportation 1976 1,623.8 1977 1,694.4 1978 1,768. 1 1979 1,844.9 1980 1,925.2 Residential and commercial 1976 1,67 1.7 1977 1,782.9 1978 1,901.6 1979 2,028.1 1980 2,163.1 Total, all sectors 1976 8,057 .8 1977 8,370.2 1978 8,696.8 1979 9,038.0 1980 9,395.0 
Source: U.S. Bureau of Mines, 1975. 
Procurement 
Procurement policies for the acquisition of energy­efficient commodities must also be included in the state energy conservation plan . Since state/local inventories have been established to satisfy a variety of user needs, perhaps the most promising approach to energy conservation is the selected application of life-cycle costing (LCC). With this technique the lowest total ownership cost of an item can be calculated , including both the acquisition price and the projected operating and maintenance costs during the expected life of a product. 
The development of an approach based on life-cycle costing can add another dimension to public contracting. Traditionally, procurements have been made on the basis of sole source or price competition. But for items with measurable service lives and clear performance character­istics, LCC offers a basis for evaluating price differences among competitive bidders by determining the logistical costs (including energy consumption) associated with the product's use. 
Texas law does not permit local governments to pur­chase under state contract, but state agencies must engage in centralized buying through the Board of Control. If local inventories are excluded , it is possible to develop a list of common-use items for state agencies, a list of items amenable to LCC analysis (see table 6). While the state energy conservation plan does not anticipate such applica­tion to all commodities on the list , it does designate two categories-automobiles and light bulbs-in which energy savings can be accomplished. From these two categories it is estimated that .03 trillion Btus can be conserved in 1980. Future conservation would depend upon expansion of the product evaluation staff of the Board of Control and enactment of cooperative purchasing legislation to include localities in state-negotiated contracts. 
Carpool/Vanpool and Right Turn on Red 
Like procurement, the two remaining mandatory pro­grams are not expected to yield significant energy savings. Carpooling efforts have been under way since 1974 in several Texas cities (San Antonio, Fort Worth, Houston, and Dallas), while vanpooling has been confined largely to the private sector (Conoco and Texas Instruments are recognized as having developed successful programs). Through a series of workshops involving municipal, indus­trial, community, and public interest groups, the Gover­nor's Office of Energy Resources will coordinate a program in which an energy savings of .42 trillion Btus (.01 percent of projected 1980 consumption) is anticipated. 
As for the final mandatory provision of the EPCA, the state does not need to take further action, having already passed a right-turn-on-red statute. No calculation of pro­jected energy savings can be made, however, because no intersection-by-intersection data exist. 
Optional Programs 
When applied to Texas, the mandatory programs of the EPCA will produce an estimated energy saving of less than 1 percent in 1980. To fulfill the statutory obligation of at 
Table 3 

Estimated 1980 Energy Savings from Application of 
Mandatory Thermal Standards in New and 
Renovated Buildings in Texas 

Energy savings in billion Btus 
Building types Space heating Air conditioning 
Residential buildings  
Single family-one unit  
detached  868.7  1,067.3  
Low density-one unit  
attached and 2-4 unit  
structures  173.7  163.9  
Low rise-structures with  
5 or more units and  
3 stories or less  186. 1  155.9  
High rise-structures with  
5 or more units and  
4 or more stories  68.2  56.7  
Nonresidential buildings  
Office buildings  988.5  252.6  
Retail stores and o ther  
mercantile buildings  590.4  197.9  
Educational buildings  676.0  250.2  
Hospitals and other  
institutio nal buildings  213.5  72.0  
Other  535.3  213.5  
Totals  4,300.4  2,430.0  

So urce: The Governor's Office of Energy Resources, State of Texas Energy Conservation Plan, June 1977. 

least a 5 percent reduction in 1980 consumption, several optional programs have been incorporated in the state energy conservation plan. These include measures designed to save energy in industrial processes, in new and existing commercial buildings, in new and existing residences, in agriculture, in public schools, and in local governments. While some of the optional programs cover the same areas as those in the mandatory provisions, the difference lies in level of effort. Voluntary measures would go beyond standard performance expectations by taking advantage of technical innovations and improvements in state-of-the-art design. 
Industrial Processes 
The industrial sector is by far the largest energy consumer in Texas, with 1980 usage estimated to be 43.5 
Table 4 
Suggested Interior Illumination Levels 
Footcandles Office buildings maintained 
Private offices Reading handwriting in hard pencil or on poor paper, reading fair reproductions 100 Reading handwriting in ink or medium pencil on good quality paper 70 Reading high contrast or well-printed materials 30 Conferring and interviewing 30 General offices Reading handwriting in hard pencil or on poor paper, reading fair reproductions, active filing, mail sorting 100 Reading handwriting in ink or medium pencil on good quality paper, intermittent filing 70 
Bank lobby Writing areas 70 General areas so 
Dental offices General operatory 70 Waiting rooms 30 
Doctors' offices General examination and treatment so Waiting rooms 30 
Conference rooms Conferring 30 Note-taking during projection (variable) 30 
Rest rooms and wash rooms 30 Corridors, stairways, elevators 20 Storage rooms 
Active-medium materials 20 Active-rough, bulky materials 10 Inactive storage s 
Stores 
Merchandise requiring close inspection 
because of detail, fineness, or high value 100* General merchandise areas so• Alteration rooms, fitting rooms, dressing 
areas 
so 
Circulation areas, stockrooms 30 
*Footcandle values on plane used to display merchandise. Horizontal plane for merchandise displayed horizontally. Vertical plane for merchandise displayed vertically. 
Source: Kaufman, Jo hn E. and Jack F. Christensen, eds., fllumina ting Engineering Society Lighting Handbook, fifth ed., 1972. 
percent of the state total. While aggregated consumption is high, individual industries use varying amounts of energy depending upon their size and technological sophistication. Yet, consumption data for specific plants are extremely difficult to find, and information on the number of Btus expended per unit of product is scarce. In order to arrive at an energy savings potential for industrial processes, the state energy conservation plan is addressed to eleven target groups (see table 7). Through the use of workshops for technical information exchange and an outreach program for small and low technology industries, an estimated 284 trillion Btus can be saved in 1980, or 3.04 percent of the state's projected energy consumption. The Texas Industrial Commission has been designated as the lead agency for implementing both efforts. 
Commercial Buildings and Residences 
New and existing commercial and residential structures offer conservation potentials that are greater than those anticipated by the mandatory programs. Commercial facil­ities (such as office buildings, supermarkets, hospitals, restaurants, hotels and motels, retail stores, and ware­houses) could benefit from design alternatives that take into consideration state-of-the-art improvements in con­struction practices, operating equipment, and building design. Residential structures could likewise be improved through the introduction of energy-saving features and appliances. 
To achieve measurable energy savings from this effort, a large number of interested parties (e.g., designers, builders, financiers, potential buyers, owners, and managers) must be persuaded that the approach is practical, cost effective, and financially sound. The state plan contains provisions for workshops and publicity campaigns-most of them to be sponsored by the Governor's Office-that would address this need. If the program is successful, the 1980 energy savings could run as high as 67 trillion Btus (0.73 percent of projected consumption) for new and existing commercial buildings and 119 trillion Btus (1.3 percent of projected consumption) for new and existing residences. 
Agriculture and the Public Schools 
Energy consumed in the agricultural sector accounts for less than 2 percent of total state consumption, with principal uses being confined to irrigation and machinery operations (planting, cultivating, fertilizing, and applying pesticide). The types of energy used in these activities are gasoline, diesel, liquified petroleum gas, natural gas, and electricity. By relying on the Agricultural Extension Service of Texas A&M University to disseminate energy conserva­tion information, the state expects to save 10.94 trillion Btus in 1980, or 0.12 percent of projected 1980 consumption. 
The prospect for energy efficiencies in the public schools 
is considerably better than for the agricultural sector, 
although the overall savings are comparatively small. De-spite this limitation, the state conservation plan contains a program measure, to be implemented jointly by the Governor's Office and the Texas Education Agency, that would upgrade energy management, improve the operation of mechanical equipment, and add energy conservation modules to the curriculum. The estimated savings for this effort are calculated at 32 trillion Btus, or 0.34 percent of projected 1980 consumption. 

Local Governments 
The remaining optional program in the state plan concerns the role of local governments in applying conser­vation measures to a number of routine activities. The assumption is that local elected officials, city managers, department heads, procurement officers, and managers of public facilities are strategically placed to implement energy-saving measures. In such areas as maintenance of city and county vehicle fleets, public purchasing, street lighting, and use of public buildings and recreational facilities, municipal and county governments could include energy efficiency as an additional element in analyzing cost effectiveness. Under the sponsorship of the Governor's Office of Energy Resources, the Texas Municipal League, and the Texas Association of Counties, the state plan calls for the creation of a series of workshops for the purpose of exchanging ideas and information on energy-use patterns at the local level. While it is recognized that local projects will vary considerably, a l 980 energy savings of 12 trillion Btus 
(0.13 percent of total projected consumption) is antici­pated. 
Taken together, both the mandatory and optional programs of the state energy conservation plan provide for an estimated savings of 534 trillion Btus in 1980, or slightly over 5.7 percent of total state consumption (see table 8). The cost of this effort is budgeted at $28.3 million, yielding a cost-benefit ratio (dollars to million Btus) of 0.05. This means that for each dollar spent, an average energy savings of between 18 and 19 million Btus can be achieved. However, this aggregate figure must be interpreted care­fully. The mandatory programs produce a savings of only 685,000 Btus per dollar, while the voluntary measures are 
Table 5 
Estimated 1980 Energy Savings from Mandatory 
Lighting Efficiency Standards in New 
Public Buildings in Texas 

Electricity savings Type of building in trillion Btus 
Office buildings 0.11 Retail stores 0.16 Schools 0 .09 Hospit-als 0.05 Other 0.17 
Total 0.58 
Source: The Governor's Office of Energy Resources, State of Texas Energy Conservation Plan , June 1977. 
estimated to yield a savings of almost 33 million Btus pet dollar. Clearly, implementing the voluntary measures (on which the figures in table 8 are based) will result in significant energy economies. 
Moreover, a number of difficulties-some technical, others institutional-stand in the way of implementing the mandatory provisions of the EPCA. In the area of thermal and lighting standards at least three potential obstacles exist: first, the indeterminant task of upgrading local code enforcement; second, the limitations associated with state­of-the-art assumptions about energy use in buildings; and third, the economic impact on markets for materials and equipment within the U.S. construction industry. 
At present, the effect that thermal and lighting efficien­cies have on total energy use within buildings is imperfectly understood. As more is learned from building experiments, questions of energy savings can be answered with greater degrees of assurance. On the economic side, the extent to which the building industry might be affected by wide­spread adoption of thermal and lighting standards remains unclear. Existing evidence suggests that market opportu­nities will increase for manufacturers of building materials (insulation, siding, flat glass, window fabrications) and decrease for suppliers of general building equipment (elec­tric lamps, lighting fixtures, gas and electric meters, hot water heaters) and heating, ventilating, and air conditioning systems (equipment and controls).2 
The principal barrier to the use of state and local procurement as a method of conservation is the absence of 
Table 6 
Energy Consumption by All State Agencies in Texas for Selected Items 
Number purchased Billions of Item in 1975 Btus consumed 
40-watt fluorescent 
bulbs 210,349 231.4 Automobiles 1,336 208.7 Arc welders 3,589 91.9 Photo copiers 1,933 59.3 100-watt incandescent 
bulbs 70,000 58.8 Floor polishers 9,377 42.2 Air conditioners 
(window unit) 1,800 32.0 Refrigerators and 

freezers 869 21.2 Clo thes dryers 248 13.7 Vac uum cleaners 1,924 13.1 Electric ovens 292 8.3 Electric ranges 296 7.1 Electric t ypewriters 19,845 5.9 Clocks 10,915 5.5 Dishwashers 150 2.0 Lathes 600 1.7 Table saws 274 1.7 Air com pressors 384 1.6 Clo thes washers 355 1.0 Movie projectors 3,000 0.9 Coffee makers 109 0.8 Food blenders 48 0.5 Drill presses 93 0.2 
Total 809.5 
Sou rce: Figures provided by the Stanford Research Institute and the Texas Board of Control. 
Table 7 

Selected Industry Target Groups for Voluntary 
Energy Conservation in Texas 

Number of establishments Industry Small* Medium# Larget 
Food and kindred products  1,104  321  68  
Textiles  S l  19  s  
Lumber and wood products  1,01 2  lSO  16  
Paper and allied products  11 9  67  11  
Chemicals and allied products  S80  11 0  so  
Petroleum and coal products  98  31  26  
Rubber and misc. plastics  30S  6 S  9  
Stone, clay, and glass pro ducts  7 31  130  21  
Primary metals  172  so  28  
Fabricated metal products  1,16 1  232  so  
Machinery  l ,74S  166  S8  

*Under SO employees. #so-2so employees. tover 2SO employees. 
Source: The Governor's Office of Energy Resources, State of 
Texas Energy Conservation Plan, June 1977; data compiled 
from U.S. Bureau of the Census, Census of Manufactures, 
19 74, and U.S. Bureau of the Census. 
a cooperative purchasing statute. Such a law would give Texas cities, counties, and special-purpose governments an opportunity to participate in state contract prices for energy-efficient items. 
As for the remaining mandatory programs-state/local procurement, right turn on red, and carpools/vanpools-the principal barriers to implementation can be stated briefly. State/local procurement is hampered in general by a restricted application of life-cycle costing techniques (large­ly the result of inadequate staff) and in particular by the absence of a state cooperative purchasing statute that would give cities, counties, and special-purpose govern­ments an opportunity to participate in state contract prices for energy-efficient items. Right turn on red is permitted by Texas law, but impediments associated with the collection and analysis of intersection-by-intersection data exist. The carpool/vanpool measure, while simple in concept, suffers not only from complex suburban residential patterns in the state but also from lack of individual incentives. 
The technical and institutional complexities that will be encountered in applying the state plan should not, however, obscure the need for an effective conservation program. The economic well-being of the state depends on the prudent use of existing and newly discovered sources of energy. By resorting to a plan that emphasizes optional measures over mandatory ones, the Governor's Office of Energy Resources has indicated its preference for a volun­tary approach. Whether a different balance will be struck in the future is not known. What is clear is that the Texas response to the EPCA demonstrates the enormous potential for energy savings in industrial processes and residential/ commercial buildings, while providing a framework within which all parties at interest can assess both mandatory and optional programs for their possible impacts and conse­quences. This approach may lack the excitement of a grand design for energy conservation, but in the end it may prove more effective. 
Notes 
1. 
Actual calculations were performed by Planergy, an Austin-based energy planning and consulting firm, under con tract to the Governor's Office. With the exception of state/local procurement, all energy savings estimates for mandatory programs were based on FEA methodology and data. 

2. 
Craig Lentz, "ASHRAE Standard 90-75 -Economic Impact on Selected Industries and the Design Profession," ASHRAE Journal, June 1976. 



Table 8 

Estimated 1980 Savings and Costs of Mandatory and Optional 
Program Measures in the State Energy Conservation Plan 

Est imated savings  Estimated cost  Cost-benefit  
Millions  Do llars per  
Program measure  Trillio n Bt us  Percentage  of dollars  million Btus  

Thermal and lighting 
standards Van pool-carpool Government purchasing Industrial processes New commercial 
build ings Existing commercial buildings New residential buildings Existing residential 
buildings Agriculture Local energy 
conservation Public schools Coordination and 
monitori ng 
7 .91 
0.42 
0.03 
283.81 
10.90 
56.52 
10.17 
109.16 
10.94 
12.00 
32.10 
534 .0 6 

0.08 
0.00 
0.00 
3.04 
0.12 
0.61 
0.11 
1.17 
0.12 
0.13 
0 .34 
5.72 11. 9 
0.2 
0.1 
2.2 
0.7 
1.0 
0.6 
6.5 
0.4 
1. 7 
1.8 
1.2 
28.3 1.50 
0.48 
3.33 
0.0 1 
0.06 
0.02 
0.06 
0.06 
0 .04 

0 .06 


0.14 
0.06 






The Lower Rio Grande Valley An Area of Rapid Growth 
Charles P. Zlatl~ovieh Carol T.F. Bennett 
The Lower Rio Grande Valley is one of the most rapidly growing metropolitan areas in the nation. Among Texas metropolitan areas, the Brownsville-Harlingen-San Benito and McAllen-Pharr-Edinburg SMSAs have growth rates equaled only by Killeen-Temple. The two South Texas SMSAs, consisting of Cameron and Hidalgo counties respec­tively, compose most of the Lower Rio Grande Valley. Two other counties, Willacy and Starr, are generally considered to be part of the Lower Rio Grande Valley but are not metropolitan counties and are dealt with only indirectly in this article. 
Although the Lower Rio Grande Valley consists of two SMSAs, it is an integrated metropolitan region in many ways. The Valley has a number of formal and informal arrangements that provide evidence of its functional inte­gration-a common telephone directory, an area-wide cham­ber of commerce, a well-connected roadway network, and a regional transit system. Some fragmentation, however, results from the fact that the Valley contains a large number of incorporated communities-fourteen in Cameron County and sixteen in Hidalgo County. 
No single city dominates the Valley. The largest three cities-Brownsville, McAllen, and Harlingen-together con­tain less than 40 percent of the population of the two counties. While evidence exists that many other metropol­itan regions increasingly resemble the Valley in this respect, the lack of a central focal point causes something of an image problem. One can say "Houston" or even "Dallas­Fort Worth" with far less effort than "McAllen-Pharr­Edinburg," let alone "Brownsville-Harlingen-San Benito." Only a few SMSAs in the nation have wordier titles than the two in the Valley. 
The separate designation of the two metropolitan areas also reduces their apparent importance in statistical com­parisons with other parts of the state and nation. In 197 5 population estimates the McAllen-Pharr-Edinburg and Brownsville-Harlingen-San Benito SMSAs rank tenth and twelfth respectively among the twenty-five Texas SMSAs. Combined, the two Valley SMSAs would have a total population of 404, 784 and would rank as the state's fifth largest metropolitan area, behind El Paso but ahead of Austin. Relatively few Texans, and even fewer out-of-state residents, would be likely to identify the Lower Rio Grande Valley as such a large metropolitan area. 
Another factor of some importance in considerations of the Lower Rio Grande Valley of Texas is the other half of the Valley across the Rio Grande, in Mexico. The principal cities on the Mexican side of the Rio Grande are Matamoros and Reynosa, each of which had a population of about 138,000 in 1970. Growth along the border has been even more rapid than in the interior of Mexico in recent years, and the total population on the Mexican side of the Lower Rio Grande Valley probably exceeds 500,000 at the present time. The economies on the Texas and Mexican sides of the Rio Grande are linked in many ways-some obvious and some subtle. 

Population Growth 
The Lower Rio Grande Valley has grown rapidly in recent years. The latest population estimates by the Bureau of the Census indicate that the Brownsville-Harlingen-San Benito SMSA grew 26.0 percent between 1970 and 1975, while the McAllen-Pharr-Edinburg SMSA grew 25.5 per­cent. The Brownsville-Harlingen-San Benito growth rate ties with that of the Killeen-Temple SMSA for the highest 


Shrimp boat harbor, Port of Brownsville 
indicates that about 20,000 persons have migrated to the Brownsville-Harlingen-San Benito SMSA since 1970, while about 22,000 have relocated in the McAllen-Pharr-Edinburg SMSA. Both components of Valley growth are well above corresponding state and national levels. 
The historical growth of the Lower Rio Grande Valley has been fairly steady except during the 1960s. Cameron County lost population during the 1960s, partially as a 

No single city dominates the Valley. The largest three cities together contain less than 40 percent of the population of the two counties. 
metropolitan area growth rate in the state, and the McAllen-Pharr-Edinburg SMSA is not far behind. Both Lower Rio Grande Valley SMSAs are among the fastest­growing metropolitan areas in the nation. 
Many population researchers are quick to point out the difficulty of developing accurate statistics for areas along the Mexican border, including the Lower Rio Grande Valley. The difficulty is evidenced by the wide variation between the earlier and the revised July 1, 1975, popula­tion estimates for the Lower Rio Grande Valley released by the Bureau of the Census. The revised estimates raised the population total from the earlier estimates for each county by more than 7 ,000. The revised estimated populations are 227,853 for Hidalgo County and 176,931 for Cameron County. 

About half of the growth of the Lower Rio Grande Valley since 1970 is attributable to in-migration, with the remainder a result of natural increase. While the revised 197 5 population estimates by the Bureau of the Census do not include a breakdown of population change into natural and in-migration components, a comparison of the revised estimates and the reported vital statistics for the area result of the closing of military bases, and Hidalgo County grew very slowly during the decade. Prior to 1960, the record of the Lower Rio Grande Valley was one of consistent growth. 

Employment Structure and Income Sources 
Despite a high degree of social interaction and economic integration, significant differences between the two Lower Rio Grande Valley metropolitan areas exist. Of the two, the Brownsville-Harlingen-San Benito SMSA economy more closely resembles the economy of the state. The McAllen­Pharr-Edinburg SMSA economy has a much higher concen­tration in agriculture and a lower level of manufacturing. Both areas have a relatively low level of federal government employment and a relatively high level of transfer pay­ments. 
Agriculture is very important to the Lower Rio Grande Valley, and Valley agriculture is important to Texas. Principal Valley crops include citrus fruit, cotton, vege­tables, grain sorghum, and sugarcane. Although the rapid growth of other segments of the Valley economy in recent years has reduced the percentage contributed to Valley personal income by agriculture, the importance of agricul­ture in the Valley should not be underestimated. Recently released 1975 personal income source estimates by the Bureau of Economic Analysis show that agriculture ac­counts for 7 .08 percent of all personal income in the Valley, against 2.68 percent of Texas personal income. The percentage contribution of agriculture has been somewhat higher in other recent years, ranging between 12.03 and 

15.70 percent in Hidalgo County for 1970 through 1974 and between 5 .03 percent and 7.15 percent in Cameron County for the same period. Among the factors responsible for the relative drop are the growth of other segments of the Valley economy and the fact that 1975 was not a particularly good year for agriculture in the Valley. Furthermore, it is possible that the initial B.E.A. income estimates for 1975 understated farm income as they did for both Cameron and Hidalgo counties in the preliminary 1974 estimates. 
Agricultural services, forestry , and fisheries are included with "other industries" by the Bureau of Economic Analysis. The "other industries" sector is larger than average in both Valley metropolitan areas. The above­average size of the sector in Hidalgo County is largely attributable to agricultural services, including such activities as cropdusting. The Cameron County "other industries" 
Percentage of Personal Income by Major Sources 
Brownsville-Harlingen-San Benito and 
McAllen-Pharr-Edinburg SMSAs and Texas, 1975 

Brownsville- McAl len- 
Harli nge n- Pharr- 
San Beni to  Edi n b urg  
So urce  SMSA  SMSA  Texas  

Agriculture  2.8 4  10 .74  2 .63  
Mi n in g  0 .18*  1.9 7  3. 52  
Constru ctio n  4 .3 1  4 .08  5.56  
Man ufact urin g  13 .17  5.53  15. 14  
Transpo rtat io n , co mmun icatio n ,  
and public util it ies  4.9 0  3.13  5 .84  
Who lesa le and ret ail trade  1 5.88  16 .56  14.54  
Fin ance, in surance, and  
real es tate  3.70  2 .14  4 .04  
Services  9 .49  8 .64  11.45  
O ther ind ustries  3 .71 *  1.3 2  0.2 7  
To tal private labo r and  
p ro prieto r in co me  58. 18  54 . 10  6 3 .00  
Federal civili an  2.49  3.0 8  3.28  
Federal m ili tary  0 .82  0 .69  2.7 9  
State and local  10.32  12 .11  7. 66  
To tal governme nt ea rnings  I 3.63  I 5 .88  13.7 3  
Total labor and pro prieto r  
in co me (place of work)  7 1.8 1  69.98  7 6.73  
Less: Perso nal con tributio ns  
fo r social insurance  3.46  2 .98  3 .78  
Resid ence adj ustment  -0.1 5  0.28  0 .15  
Ne t la bo r and pro prieto r  
in co m e (place o f res id ence)  68 .2 1  67 .2 8  73.11  
Divi dends, interes t , and ren t  I 5 .86  I 6. 50  15 .64  
Transfe r pay m ents  15.9 4  16.23  11.26  
To tal personal in come  
(place o f resid en ce)  100.0 0  100.00  I 00.00  

•Authors' estimates. Source: Developed from data compiled by Regional Economics 
Information System, Bureau of Economic Analysis, U.S. Department of Commerce. 
total reflects the importance of the shrimping industry. Some four hundred commercial fishing boats are based in the area, principally at the Port of Brownsville. According to data contained in County Business Patterns, some 48 percent of all commercial fishing activity in Texas is based in Cameron County. The Brownsville area became a popular base for commercial fishing operations because of its location near the center of prime shrimping waters, which extend roughly from Louisiana to the Yucatan peninsula. The recent extension of national territorial fishing limits by the United States and Mexico may have an adverse impact on the Valley as a base for shrimping fleet operations in the future , since the stated policy of Mexico is to reduce the currently licensed volume of fishing in Mexican waters by 
U.S. 
fishing boats. The elimination of access to Mexican waters would shift the center of the fishing grounds for 

U.S. 
boats up the coast. Thus far, permits to fish in Mexican waters have been available to U.S.-based boats, and there are indications that the permits may remain available for the foreseeable future. 


Wholesale and retail trade is another sector of the economy that provides a larger share of personal income in the Valley than at the state level. In the McAllen-Pharr­Edinburg SMSA nearly 40 percent of all trade employment is involved in wholesale trade, against about 27 percent of statewide trade employment. More than half of the Hidalgo County wholesale trade sector is concentrated in the wholesaling of fruit and vegetables. The Brownsville­Harlingen-San Benito SMSA, with less than 23 percent of its trade employment in wholesaling, is more oriented toward retail trade. Frequent shopping visits by Mexican residents boost the importance of retail trade in Brownsville and other border cities. Many Valley merchants depend on the Mexican trade and suffered severe losses of volume following the recent devaluation of the Mexican peso. The devaluation reduced the equivalent value of the peso from its traditional level of 8 cents to about 4.3 cents, although many Valley merchants offer slightly more favorable exchange rates as a part of their marketing efforts. 
Manufacturing forms a smaller part of the economic base of the Valley than of the state. The Brownsville-Harlingen­San Benito SMSA approaches the state level of 15.14 percent of total personal income derived from manufactur­ing with 13 .1 7 percent of its personal income from that source, but manufacturing provides only 5.53 percent of total personal income in the McAllen-Pharr-Edinburg SMSA. 


In each case, with the exception of the "other indus­tries" category noted above, the other private sector segments of the economy provide lower percentages of total personal income in the Valley than in the state. The Brownsville-Harlingen-San Benito SMSA economy more nearly resembles the state economy in each of the other sectors, with the exception of mining. 
Federal government employment also accounts for a smaller percentage of Valley personal income than of Texas personal income. The level of federal civilian employment is relatively higher in the McAllen-Pharr-Edinburg SMSA. Federal military earnings in the Valley are minimal. There are no significant military installations in the Valley. 
While federal government earnings are comparatively low in the Valley, state and local government earnings are relatively high. The number of significant incorporated communities in the Valley is a factor in the high level of local government employment and earnings. The major educational institution in the Valley is Pan American University at Edinburg, with about 7 ,000 students and a faculty of 330. Other higher educational institutions in the Valley are Texas Southmost College at Brownsville and the Texas State Technical Institute Rio Grande Campus at Harlingen. 
Transfer payments are a relatively large source of personal income in the Valley. The area suffers from a high unemployment rate and a low per capita income level, both of which contribute to a high level of transfer payments. Unemployment levels in the Valley have been about twice as high as the state level recently. The unemployment rate for the Brownsville-Harlingen-San Benito SMSA has aver­aged 10.8 percent for the most recent twelve months for which data are available, while unemployment in the McAllen-Pharr-Edinburg SMSA has averaged 11.2 percent. The statewide unemployment average for the same period 
Nonagricultural Civilian Payroll Employment Percentages 
Brownsville-Harlingen-San Benito and McAllen-Pharr· 
Edinburg SMSAs and United States 
March 1977 

Brownsville- McAJlen- 
Harlingen- Pharr- 
San Benito  Edinburg  United  
Category  SMSA  SMSA  States  

Mining 0.1 1.8 1.0 Contract construction 5.2 5.9 4.3 Manufacturing 18.4 13.1 23.8 Transpo rtatio n , 
communication , public utilities 5.5 3.8 5.6 Trade 28.3 35.7 22.l 
Finance, insurance, 
and real estate 5.4 3.0 5.5 Services 16.0 11.4 18.6 Government 21.0 25.3 19.0 

Sources: Data for Brownsville-Harlingen-San Benito and McAJlen­Pharr-Edinburg obtained from Manpower Trends, May 1977, published by Texas Employment Commission; U.S. data obtain­ed from Mo nthly Labor Review, May 1977. 

Pan American University campus, Edinburg 
was 5.4 percent. Of the 261 metropolitan areas for which the Bureau of Economic Analysis publishes per capita personal income estimates, the Brownsville and McAllen SMSAs rank 259th and 26lst respectively, separated in the rankings by Laredo. These statistics tend to give the Valley an unreasonably poor image, in relation to areas away from the border. 
Key Manufacturing Industries 
Food processing was the first major industry in the Lower Rio Grande Valley and remains the most important. Both agriculture and commercial fishing provide raw materials for the Valley food-processing industry. More than 31 percent of all manufacturing employment in the Valley is concentrated in the food-processing industry, while the figure for the state is 10 percent of total manufacturing employment, according to data contained in County Business Patterns. Of the nineteen major manufac­turing plants in the Lower Rio Grande Valley with more than 250 employees listed in the Directory of Texas Manufacturers , nine are food-processing facilities. 
Apparel manufacturing is the second largest industry in the Valley in employment and number of major plants. The manufacture of apparel and related products represents about 18 percent of the Valley manufacturing work force, against about 9 percent of the state manufacturing employ­ment total. Five Valley apparel plants have more than 250 employees each. 
Durable goods manufacturing in the Valley is concen­trated in Brownsville. The largest plants produce offshore platforms and equipment, patio and pool equipment, and buses. Major plants in other parts of the Valley produce rubber seal rings and polyethylene products. Other notable activities in the Valley include the manufacture of elec­tronic components and the construction and repair of marine vessels. A sizable ship-dismantling industry has also developed at the Port of Brownsville, with four operations currently active . 
The industrial potential of the Valley is enhanced by its climate and by the availability of ample, eager labor. The 
Manufacturing Plants with More Than 250 Employees Brownsville-Harlingen-San Benito and McAllen-Pharr­Edinburg SMSAs, 1976 
Name of co mpany Establishment and co mmunity date Primary products 
Aquaslide ' N ' Dive Corp .,  Pa tio and pool  
Brownsville  1972  equipment  
Booth Fisheries,  
Brownsville  19 56  Frozen shrimp  
The William Carter Co.,  
Harlingen  1972  Apparel  
Eagle Intern atio nal,  
Brownsvill e  1973  Buses  
Edinburg Mfg. Co.,  
Ed in burg  1968  Apparel  
W. R. Grave & Co .,  
Brow nsville  19 58  Frozen shrimp  
Hygeia Dairy Co.,  
Harlingen  1927  Dairy pro ducts  
Knapp-Sherrill Co .,  
Elsa  194 3  Can ned veget ables  
Levi Stra uss & Co .,  
Brownsville  19 21  Apparel  
Levi Strauss & Co .,  
Harlinge n  1973  Apparel  
Levi Strauss & Co .,  
San Benito  19 59  Appare l  
Maratho n LeTourn ea u  
Offshore Co.,  
Brownsville  197 1  Offsho re platfo rms  
Par ker Seal Co .,  
McAll en  1974  Rubber 0 rings  
Rio Grande Valley  
Sugar Growers Inc.,  
Santa Rosa  1973  Sugar  
Taormin a Co .,  
Do nn a  1932  Canned vege tables  
Texas Plastics Inc.,  
Elsa  1953  Polyethy lene p ro ducts  
Texsun Co rp.,  
Weslaco  19 35  Fruit juices  
Vahlsin g In c.,  
Mo nte Alto  1966  Fro ze n vege tables  
Wi n ter Garden In c.,  Frozen veget ables  
Brow nsville  194 5  a nd seafo od  

So urce: 19 76 Directory of Texas Manufacturers (Austin: Bureau of Business Research, 1976). 
Valley also benefits from access to water transportation and its proximity to Monterrey, one of the major industrial centers of Mexico. The primary detriment to industrial location in the Valley is the distance from major U.S. markets. A recently announced plan to construct a new natural gas pipeline from the interior of Mexico to the Valley will provide the area with a new energy supply and resource and should enhance the industrial potential of the area. 
Population and Income Profile 
The population of the Lower Rio Grande Valley is substantially younger than the state population. The median ages in the Brownsville-Harlingen-San Benito and McAllen-Pharr-Edinburg SMSAs are 22.3 and 22.4 respec­tively. Both are much lower than the statewide median age of 27.2 years. 
Income levels in the Lower Rio Grande Valley are also low. The median household effective buying income (the total income of all household members after taxes) is only 67 percent of the state median level in Cameron County and 60 percent of the state level in Hidalgo County. 


Socioeconomic Characteristics 
The Lower Rio Grande Valley may be described as an area with the following characteristics: 
•
A very high growth rate, 

•
An economy closely related to agriculture, 

•
A concentration of employment in trade, 

•
Relatively low federal employment, 

•
Manufacturing activity concentrated in food processing and apparel, 

•
A youthful population, and 

•
Low per capita and household income levels. 


Significant Factors 
The Lower Rio Grande Valley is a unique part of Texas. The tropical climate of the Valley provides a growing season and opportunity for year-round outdoor activity 
Age Profile for Brownsville-Harlingen -Son Benito and McAllen-Pharr Edinburg SMSAs and Texas
Age group 
50+ 35-49 25-34 18-24 0-17  I I I I I I I I I I I II  LJ Brownsville Harlin~en San Benito SMSA CJ McAllen Pharr Edinburg SMSA LJ Texas I ,I I  
Percentage of o population 5  10 15 20 25  30 35 40 •  

Source: Sales and Marketin Mana ement, July 26, 1976. 

found in only a few parts of the nation. In addition, the Valley is located on the coast and adjacent to the border. The Valley is an attractive area to which many people have moved in recent years and to which more can be expected to relocate in the future. 
A substantial group moves to the Valley once a year and then moves away again. These are the "Winter Texans" who arrive in the Valley in the fall and depart in the spring. The actual number of Winter Texans is not known, but estimates range upward from 30,000. The recreational vehicle parks that are members of the Lower Rio Grande Valley Chamber of Commerce provide more than 11,500 spaces for winter visitors. High occupancy levels are reported, and there are numerous other recreational vehicle parks and other facilities in the Valley. According to a survey by the Bureau of Business and Economic Research at Pan American University, the typical winter visitor party consists of two persons in their sixties. About 70 percent of the winter visitors stay in their own travel trailers, motor homes, or mobile homes while in the Valley. The median length of stay in the Valley is seventeen weeks. More than half of the winter visitors come from the five states of Iowa, Minnesota, Illinois, Michigan, and Missouri, with other portions of the upper Midwest and central Canada accounting for most of the rest. 
Another group of migrants to the Valley enters under less favorable circumstances. Illegal aliens from Mexico are consistently drawn across the border by the prospect of higher earnings and better opportunities in the United States. The gap between earnings and opportunities in Mexico and those in the United States is much wider than the Rio Grande. Semiskilled entry-level workers at one modern, air-conditioned electronics plant in Matamoros earn about eighty-seven cents per hour. Other, less desirable jobs on the Mexican side of the border pay considerably less. The average wage, income, and unemployment levels in the Rio Grande Valley of Texas do not look so unfavorable from the opposite side of the Rio Grande. Little short of a "Berlin Wall" is likely to keep illegal aliens from entering the Valley and other parts of the United States unless the economic gap between the United States and Mexico is narrowed. 


Other problems will confront the Valley in the future. Increased growth may create a conflict between agricultural and other land uses. Such conflicts have arisen in other sections of the country with far less justification than in the Valley . There is certainly no shortage of land for agricul­tural purposes in other parts of Texas. However, agricul· tural land of the quality found in the Lower Rio Grande Valley is very scarce. While some crops grown in the Valley could be grown elsewhere, others, such as grapefruit, can be produced only in limited areas. 
Water resources may also become a problem. Develop­ment on booming South Padre Island comes to an abrupt halt some five miles up the coast from Brazos Santiago Pass because there are no water rights allocated to the upper portion of the island. The development of a more economi­cal desalinization process seems to offer the best hope for a long-term solution of Valley water problems. 
Increased cooperation will be required to solve some Valley problems. For example, transportation is critical to the Valley because it is a long distance from other major population and production centers. Valley air transporta­tion resources are thinly spread among three airports with scheduled airline service. While many observers agree that more efficient service would be provided at fewer facilities, proposals for a reduction in the number of air terminals are not greeted with much enthusiasm in the Valley. In the meantime, Harlingen, which has captured 60 percent of the Valley air traffic in recent months, may be in effect becoming the regional airport for the area. 
Despite its problems, the Valley has grown rapidly and can be expected to grow rapidly in the future. One man who shared in the growth of the Valley is Lloyd Bentsen, Sr., father of Senator Bentsen. He came to the Valley to learn to fly after World War I and stayed to become a major developer of the Valley. Bentsen believes that the Valley will continue to grow to a level comparable to that of other areas, such as Southern California and parts of Florida, with similar resources. He is not alone in his vision of a bright future for the area, as evidenced by the continuing stream of new residents. 
Effective Buying Income Profile for Brownsville.Horlingen­
Son Benito ond McAllen-Phorr-Edinburg SMSAs ond Texos 
Income 


m~rowns~;11e
25,000+ 
H I 
Harl1ng€fl I Median income t Benito 71868 SA
I 
15,000-24,999 
I CTJ ~CAiien-


I :tarr 
Median moome mburg
I 
7,047 Sj\<SA 10,000~ 14,999 
i 
I 

o-rexas 
I 
Median income 
8,000-9,999 
I 11.139 
I I 
I 
i II 
0-7.999 

I 
Percentage of o 
5 10 15 20 25 30 35 40 45 50 55 
households 

Source: SJ/es and Marketing Managemenc, July 26, 1976. 
Pan American Bank, Brownsville 

SEPTEMBER 1977 


Texas Construction 

Susanne Ethridge Cannon 

The seasonally adjusted index of total construction authorized in Texas in July hit the third highest level ever recorded, 295 .3. Although the index was down from June's 376.9, it was still higher than in any month in 1976. The index for residential permits was up 40 percent in year-to­date comparisons, but residential permits for the month of July were down from the total in June. 
Although the number of building permits issued in Texas in July 1977 was substantially larger than in July 1976, the estimated value of total construction permits fell from 
618.4 million in June to 460.3 million in July. The one-month figures show similar declines in most categories. Total residential permits fell 28 percent in value-single­family 21 percent and multifamily 50 percent. The value of building permits for nonresidential construction and for additions, alterations, and repairs fell 22 percent. 
In each case the substantial drop in month-end figures did not cause the total to drop below the count for the same period in 1976. On the contrary, the estimated values of construction permits for the year show total construc­tion up 28 percent, new construction up 29 percent, residential construction up 48 percent, and nonresidential construction up 8 percent. Permit value for additions, alterations, and repairs climbed 17 percent. 
The seven standard metropolitan statistical areas show­ing the greatest increase in the number of residential units authorized for the year were Bryan-College Station (80 percent), Dallas-Fort Worth (83 percent), El Paso (57 percent), Lubbock (85 percent), San Antonio (82 percent), Tyler (57 percent), and Waco (79 percent). In five of these SMSAs the important factor in the change was an extraor­dinary rise in the number of apartment units authorized. Bryan-College Station recorded a 208 percent increase of 791 apartment units authorized; Dallas-Fort Worth, a 193 percent increase of 6,707 units; and Lubbock, a 106 percent increase of 608 units. San Antonio showed a 192 percent gain of 1,075 units and Tyler a 158 percent gain of 126 units. In each of these five SMSAs the percentage and absolute gains in apartment units exceeded the percentage and absolute gains in single-family units. Only in El Paso and Waco did the absolute gain in the number of single-family units outpace the absolute gain in the number 
of multifamily permits. 

Analysis of the number of building permits for the year shows that the increase in single-family units has been the most consistent factor statewide. Fourteen of the twenty-five SMSAs reported increases of more than 15 percent in the number of single-family permits for the first seven months of 1977; only five had any decline from 1976 figures. The greatest change in the number of single-family permits occurred in the Dallas-Fort Worth SMSA, where there were 3,224 more permits than last year. The largest percentage increase, 64 percent, was in Lubbock. In the apartment permit category eight SMSAs had more than a 100 percent gain from last year, one SM SA had a 90 percent decline, and another registered an 88 percent decline. Clearly the erratic multifamily market can have a drastic impact both on the statistics as collected for the Department of Commerce and on the economic health of smaller SMSAs. 
After the spate of newspaper articles proclaiming apart­ment shortages in the larger cities it is useful to ask just what the numbers mean. First, is it possible to estimate a trend based on the last four or five years of residential construction? Certainly not. In any of the small SMSAs a decision by one builder to construct even one medium-sized apartment complex can cause the statistics as collected to v.ary widely from present figures . When one considers that the purchase of a building permit is only one step in a lengthy process of development and construction and that the purchase is not necessarily made immediately prior to site work, the use of permits as a predicting tool is certainly not warranted. Even if a permit issued in a given year meant construction in that year, one could not use the count as a predicting tool. 
The table "Dwelling Unit Construction in Selected SMSAs, 1972-1977" shows the actual number of dwelling units constructed in the six SMSAs that reported decreases in residential permits. The case of Amarillo is instructive. A trend line drawn for the years 1972 through 197 6 would have predicted 700 apartment units for the first seven months of 1977. However, the single unusual entry of only 66 units in 1977 results in a trend line prediction for 1978 of 367 units. The impact of such substantial shifts causes wide variations in any trend line analysis and limits its usefulness. 
If the statistics cannot be used as predictors, can they be used as accurate reflections of the cost of construction? No. The differences in average cost per dwelling unit, based on building permits issued within SMSAs, cannot be attributed simply to differences in average square foot size in the various markets. 
The building permit process varies from city to city. Austin uses the recently revised Uniform Building Code guide of $24 per square foot for residential construction and charges builders $.03 per square foot for the permit. The average unit this year is estimated at a cost of $44,000. 
Laredo, which has many owner-builder requests for very small houses, introduced its first building code in May 1975. Prior to that time the cost of a building permit was $1 per unit; now it is based on the estimated cost of the unit. Contractor estimates for the permits run approxi­mately $18 to $20 per foot. The city uses the builder's estimate as the value per unit unless the estimate seems too low. 
Wichita Falls uses a $12 estimate for the living area and one half the garage to arrive at a unit value. San Antonio officials estimate $12 per square foot for an owner-builder and use the contractor's estimate for other residential units. 
Estimated Values of Building Authorized in Texas# 
Percent change  
Jul  Jan-J ul  
1977  1977  
Julp  J an -Julp  fro m  fro m  
1977  1977  Jun  Jan-J ul  
Classificatio n  (tho usands of do llars)  1977  1976  

A ll Permits  4 60 ,264  3,4 2 4 ,739  -26  28  
New constructio n  4 13 ,601  3,079,25 8  -26  29  
Residential  
(ho use keeping)  235,609  1,8 4 7,92 3  -28  4 8  
O ne-fam ily dwellings  192,320  1,41 1,192  -2 1  4 2  
Multiple-family  
dwellings  43,289  4 36,73 1  -so  74  
No nresid ential  177,992  1,23 1,335  -22  8  
Ho tels, m otels, and  
to urist co urts  2 4 ,5 45  54 ,6 02  104  - 38  
Amusem ent buildings  1,999  36,60 5  -74  215  
Churches  5,159  47 ,56 1  -22  32  
Industrial buildings  24,576  138,051  - 2  83  
Garages (com mercial  
and private)  1,0 89  24 ,39 1  -82  48  
Service st atio ns and  
repair garages  633  5,29 1  -2 3  -19  
Hospitals and  
institutio ns  14,897  87 ,655  16  -26  
Office-ban k buildings  22,945  260,075  -55  11  
Works and utili ties  2,168  36,9 10  -33  -58  
Educatio nal buildings  2 3,199  164,367  -39  - 2  
Stores and mercan tile  
buildings  48,369  3 16,463  - 9  45  
O ther build ings and  
stru ct'\lfes  8,41 3  59,364  -32  -21  
Additio ns, alteratio ns,  
and repairs  46,663  34 5 ,48 1  -22  17  
SMSA vs. non-SMSA  
Total SMSAt  417,835  3,1 10 ,646  -25  27  
Central ci ties  299,7 18  2,0 70,8 30  -18  25  
O utside central cities  118,1 17  1,0 39,8 16  -38  32  
To tal no n-SMSA  42,429  3 14 ,093  -29  33  
10,000 to 50,000  
po pulatio n  22,789  173,052  -33  29  
Less than 1O,000  
po pulatio n  19,640  141,04 1  -24  39  

#o nly building for which permits were issued within the incorpo­rated area of a city is included. Federal contracts and public housing are not in cluded. 
PPreliminary. tstandard metropolitan statistical area as defined in 1975 census. Source: Bureau of Business Research in cooperation with the Bureau of the Census, U.S. Department of Commerce. 
SEPTEMBER 1977 Recent estimates for brick veneer construction have been running approximately $15 per square foot. 
It is impossible to use estimated value figures to analyze any trends in construction costs because of the considerable differences in local methods governing permit authoriza­tions and estimations of value. Additionally, interpretation of estimated value trends for individual cities or SMSAs is complicated by the fact that the individual estimating techniques may change without regard to past practices. The Laredo experience demonstrates this continuity prob­lem. It would be reasonable for local decision makers to examine the practices of their local officials prior to attempting any analysis of estimated values. 
Accurate analysis of residential permit authorizations can be made on the basis of the number of dwelling units. However, such an analysis cannot be done for nonresiden­tial units. Housing statistics can be used to analyze the results of all the factors that go into housing decisions­financing, vacancies, demographics-but not to predict the future or to assess the impact of inflation. 
Dwelling Unit Construction in Selected SMSAs 
1972-1977* 
Type of unit 
One-Two-SMSA and year family family Apartme nt Total 
Amarillo 1972 19 73 1974 1975 1976 1977 
Galveston-Texas City 1972 1973 1974 1975 1976 1977 
Midland 1972 1973 1974 197 5 1976 1977 
Odessa 1972 1973 1974 1975 1976 1977 
Texarkana 1972 1973 1974 1975 1976 1977 
Wichita Falls 1972 1973 1974 1975 1976 1977 346 363 4 28 564 736 956 
28 1 150 442 190 49 1 422 
104 96 73 
257 2 18 381 
98 96 99 196 356 365 
1 15 56 54 67 56 44 
217 209 168 214 364 350 
52 120 22 532 30 490 20 338 14 668 62 66 
2 715 0 423 2 113 0 215 12 176 12 118 
0 26 
2 123 68 0 18 0 30 496 42 301 
20 104 0 198 16 188 
2 600 36 532 0 312 
4 82 12 0 12 218 6 0 4 104 6 12 
0 272 0 237 0 240 0 0 0 6 6 0 
518 9 17 948 922 1,41 8 1,0 84 
998 573 557 405 679 552 
130 22 1 14 1 275 744 724 
222 294 303 798 924 677 
2 01 68 284 73 164 62 
489 446 408 2 14 370 356 
*Period reflected is January through July of each year. Source: Tabulations by the Bureau of Business Research. 


Local Business Conditions 

Statistical data compiled by Mildred Anderson, Kay Davis, Marylyn Donaldson, and Joan Holloway. 
Standard metropolitan statistical areas (SMSAs) include one or more Census. They represent only building authorizations within city entire counties, as shown. All SMSAs are designated as such by the limits and exclude federal contracts and public works projects, such 
U.S. Bureau of the Census. Population figures are from the 1970 as highways, waterways, and reservoirs. Building statistics for the census and 1975 estimates by the Bureau of the Census. latest month are subject to revision. Building permit data are collected from municipalities by the Employment estimates include only wage and salary workers and 
Bureau 	of Business Research in cooperation with the Bureau of the are compiled by the Texas Employment Commission in cooperation with the U.S. Bureau of Labor Statistics. 
Indicators of Local Business Conditions 
for Texas Standard Metropolitan Statistical Areas 

Percent change Percent change from from 
Jul Jun Jul Jul Jun Jul Reported area and indicator 1977 1977 1976 Reported area and indicator 1977 1977 1976 
ABILENE SMSA CORPUS CHRISTI SMSA 
Callahan, Jones, and Taylor Counties; population: 122,164 (1970); Nueces and San Patricio Counties; population: 284,832 (1970); 

128,400 (1975 est.) 29 7 ,300 (19 75 est.) Urban building permits ($1,000) 5,S69 38 132 Urban building permits ($1,000) 8,77S 4 83 Nonfarm employment 46,700 I I Nonfarm employment l03,7SO l •• 
Manufacturing employment S,670 4 -20 Manufacturing employment I 1,800 I 7 Unemployed (percent) s.o 4 14 Unemployed (percent) 6.9 s s 
AMARILLO SMSA DALLAS-FORT WORTH SMSA 
Potter and Randall Counties; population: 144,396 (1970); Collin, Dallas, Denton, Ellis, Hood, Johnson, Kaufman, 

l 52,000 (1975 est.) Parker, Rockwall, Tarrant, and Wise Counties; Urban building permits($I ,000) 7,SSS -22 34 population: 2,378,353 (1970); 2,552,800 (1975 est.) Nonfarm employment 67,260 ** 2 Urban building permits ($ 1,000) 133,766 -19 S7 
Manufacturing employment 8,010 8 -11 Nonfarm employment 1,161,000 ** 4 Unemployed (percent) 3.4 -3 -IS Manufacturing employment 2S6,SOO I 4 
Unemployed (percent) 3.8 -3 -22 AUSTIN SMSA Hays and Travis Counties; population: 323,158 (1970); EL PASO SMSA 
394,800 (1975 est.) EI Paso County; population: 359,291 (1970); 414,700 (1975 est.) Urban building permits ($1,000) 19,274 -21 -2 Urban building permits ($1,000) 13,340 -4S 24 Nonfarm employment 180,200 ** 4 Nonfarm employment 136,1 SO -1 -2 
Manufacturing employment 19,300 2 12 Manufacturing employment 30,SOO ** -2 Unemployed (percent) 4 .9 4 -4 Unemployed (percent) 11.6 -6 16 
BEAUMONT-PORT ARTHUR-ORANGE SMSA GALVESTON-TEXAS CITY SMSA Hardin, Jefferson, and Orange Counties; population: Galveston County; population: 169,812 (1970); 347,568 (1970); 349,500 (1975 est.) 182,000 (1975 est.) Urban building permits ($I ,000) 10,S9 l -42 24 Urban building permits ($1,000) 4,008 I 80 Nonfarm employment 137,9SO ** ** Nonfarm employment 72,340 2 8 Manufacturing employment 41,2SO ** 1 Manufacturing employment 11,840 1 2 Unemployed (percent) 7.4 ** -s Unemployed (percent) 7.2 -13 s 
BROWNSVILLE-HARLINGEN-SAN BENITO SMSA HOUSTON SMSA Cameron County; population: 140,368 (1970); 169,300 (1975 est.) Brazoria, Fort Bend, Harris, Liberty, Montgomery, and Waller Urban building permits ($1,000) S,2S9 3 119 Counties; population: 1,999,316 (1970); 2,297,300 (1975 est.) 
Nonfarm employment 	S0,090 l 2 Urban building permits ($1,000) 1OS ,213 -20 4 Manufacturing employment 8,930 1 ** Nonfarm employment 1,161,000 ** 6 

Unemployed (percent) 	10.2 8 -10 

Manufact uring employment 190,900 l 1 Unemployed (percent) 4.9 -6 -20 
BRYAN-COLLEGE STATION SMSA Brazos County; population: 57,978 (1970); 72,300 (1975 est.) KILLEEN-TEMPLE SMSA Urban building permits ($1 ,000) S,173 SO 194 Bell and Coryell Counties; population: 159,794 (1970); 
(Monthly employment reports are not available for the 210,500 (1975 est.)
Bryan-College Station SMSA.) 

Urban building permits ($1,000) 11,343 S6 120 (Monthly employment reports are not available for the Killeen-Temple SMSA.) 
Percen t change Percent change from fro m 
Jul Jun Jul Jul Jun Jul Reported area and indicator 1977 1977 1976 Reported area and indicator 1977 1977 1976 
LAREDO SMSA TEXARKANA SMSA (continued) Webb County; population: 72,859 (1970); 78,100 (1975 est.) Unemployed (percent) 7 .2 •• -27 Urban building permits ($1,000) 1,950 48 -18 (Since the Texarkana SMSA includes Bowie County in Texas and No nfarm employment 25,870 1 3 Little River and Miller Counties in Arkansas, all data, including 
Manufacturing employment 1,910 1 9 population, refer to the three-county region.) Unemployed (percent) 13.0 6 4 
TYLER SMSA LONGVIEW SMSA Smith County; population: 97,096 (1970); 107,400 (1975 est.) Gregg and Harrison Counties; population: 120,770 (1970); Urban building permits ($1,000) 6,538 -24 l 08 
125,300 (1975 est.) 

Nonfarm employment 43,190 ** 5 Manufacturing employment 12,210 -l 6
Urban building permits ($1 ,000) 9,435 ** 140 
Unemployed (percent) 5.6 14 7
Nonfarm employment 52,000 4 Manufacturing employment 16,780 4 
WACO SMSA
Unemployed (percent) 6.6 ** 7 
McLennan County; population: 14 7,553 (1970); LUBBOCK SMSA 156,700 (19 75 est.) Lubbock County; population: 179,295 (1970); 196,700 (1975 est.) Urban building permits ($1,000) 4,8 14 27 34 Urban building permits ($1,000) 9,947 -18 38 Nonfarm employment 62,620 l 2 
Nonfarm employment 79,640 l 6 Manufacturing employment 14,700 2 2 Manufacturing employment 12,440 l 12 Unemployed (percent) 5.5 ** ** Unemployed (percent) 3.3 -11 -23 
WICHITA FALLS SMSA McALLEN-PHARR-EDINBURG SMSA Clay and Wichita Counties; population: 128,642 (1970); Hidalgo County; population: 181,535 (1970); 220,700 (1975 est.) 130,700 (1975 est.) 
Urban building permits ($ 1,000) 7,319 -6 42 Urban building permits ($1,000) 1,798 -78 -41 Nonfarm employment 56,230 -6 3 Nonfarm employment 46,850 ** 3 Manufacturing employment 7 ,600 -11 6 Manufacturing employment 8,170 ** 7 Unemployed (percent) 11 .l 14 -10 Unemployed (percent) 3.9 •• -13 
MIDLAND SMSA **Absolute change is less than one half of l percent. 
Midland County; population: 65,433 (1970); 69,700 (1975 est.) 
Urban building permits ($1,000) 5 ,409 9 469 

Nonfarm employment 28,8 70 ** 2 Manufacturing employment 1,960 2 4 Unemployed (percent) 3.1 -3 -24 
Selected Barometers of Texas Business 

ODESSA SMSA 
(Indexes-Adjusted for seasonal variation-1967=100) 

Ector County; population: 92,660 (1970); 98,800 (1975 est.) 
Urban building permits ($1 ,000) 1,786 5 -44 

Percent change

Nonfarm employment 44,160 l 7 Manufacturing employment 5,960 ** 7 Year-to-Unemployed (percent) 3.1 -6 -31 Jul date 
Year-to-19 77 average SAN ANGELO SMSA date fro m 1977 Tom Green County; population: 71,047 (1970); 74,800 (1975 est.) Jul Jun average Jun from 
Index 1977 1977 1977 1977 1976Urban building permits ($1 ,000) 1,4 71 -51 -86 Nonfarm employment 28,900 l 6 

Crude oil production 101.4P 102.lp 102.4 -4Manufacturing employment 5,410 l 2 Total electricUnemployed (percent) 3.2 7 -32 
power use 203.0p 200.3p 205.0 l 12 Residential 230.3p 234.7p 258.3 2 12

SAN ANTONIO SMSA 
Industrial l 7 l.7p 168.6p l 71.8 2 13

Bexar, Comal, and Guadalupe Counties; population: 
Total industrial 
888,179 (1970); 977,200 (1975 est.) production l 39.8p l 39.4p J 37.4 •• 4 
Urban building permits ($1 ,000) 25,254 -33 48 

Urban building
Nonfarm employment 332,600 ** l permits issued 295.3p 376.9p 293.6 -22 27 
Manufacturing employment 41,750 ** l New residential 354.3p 449.0p 349.5 -21 48 
Unemployed (percent) 8.3 2 2 New no nresidential 
(unadjusted) 244.3p 314.9p 241.4 -22 8

SHERMAN-DENISON SMSA 
Total no nfarm Grayson County; population: 83,225 (1970); 79,000 (1975 est.) employment 148.6p 148.6p 148. 1 ** 4 Urban building permits ($1,000) 2,462 -48 493 Manufacturing Nonfarm employment 30,760 * * 5 employment J 32.9p l 32.3p 132. l •• 3 Manufacturing employment 11 ,110 9 Average weekly earn-Unemployed (percent) 8.1 11 -22 ings-manufacturing 200.6p 200.8p 192.3 ** 6 Average weekly hours-TEXARKANA SMSA manufacturing 98.3p 98 .8p 96.5 l 2 Bowie County, Texas; Little River and Miller Counties, Arkansas; Total unemployment 15 7 .2 148.0 168.8 6 5 population: 113,488 (1970); 114,700 (1975 est.) Insured unemployment 268.0 264.8 249.5 1 4 Urban building permits ($1 ,000) 3,993 97 31 
Preliminary.

Nonfarm employment 40,730 l 4 
**Change is less than one half of 1 percent.
Manufacturing employment 8,310 2 11 Percent change Percent change

Jan-Mar Jan-Mar 
Jan-Mar 1977 from Jan-Mar 1977 from
Reported area and 1977 Reported area and 1977 kind of business ($000) Oct-Dec 1976 Jan-Mar 1976 kind of business ($000) Oct-Dec l 976 Jan-Mar 1976 
ABILENE SMSA BRYAN-COLLEGE STATION SMSA Apparel, accessories 4,073 -35 46 Apparel, accessories 2,051 -27 26 Automotive dealers, Automotive dealers, 
service stations 48,848 11 76 service stations 14,986 -9 8 Building materials, Building materials, 
farm equipment 8,224 6 8 farm equipment 8,148 18 52 Drugstores 2,505 5 2 Drugstores 1,223 -16 42 Eating and drinking 8,409 2 18 Eating and drinking 5,249 -2 25 
Food 22,808 6 31 Food 13,907 29 Furniture, home Furniture, ho me 
furnishings 6,292 6 20 furnishings 2 ,221 -24 25 General merchandise 11,924 -38 2 General merchandise 7,707 ·-33 14 Liquor 1,379 -1 l 27 Liquor 851 -16 15 Miscellaneous retail 26,290 -2 28 Miscellaneous retail 5,189 -7 21 
** 

AMARILLO SMSA CORPUS CHRISTI SMSA Apparel, accessories 8,487 -32 8 Apparel, accessories 9,130 -9 42 Automotive dealers, Automotive dealers, 
service stations 63,843 -3 23 service stations 68,913 11 14 
Building materials, Building materials, 
farm equipment 13,2 77 -20 20 farm equipment 1 7 ,257 4 14 Drugstores 7 ,185 -28 10 Drugstores 6,091 -35 -2 Eating and drinking 14,149 9 11 Eating and drinking 19,431 2 13 Food 32,578 -5 29 Food 58,042 3 64 Furniture, home Furniture, home 
furnishings 11,823 ** 47 furnishings 12,754 1 40 General merchandise 18,321 -41 2 General merchandise 24,323 -38 3 
Liquor 3,849 -21 9 Liquor 2,914 -20 8 
Miscellaneous retail 31 ,226 -18 32 Miscellaneous retail 47,438 -19 2 
AUSTIN SMSA DALLAS-FORT WORTH SMSA 
Apparel, accessories 15 ,960 -24 24 Apparel, accessories 139,060 -18 ** 
Automotive dealers, Automotive dealers, 

service stations 80,207 -3 17 service stations 783,558 5 15 
Building materials, Building materials, 
farm equipment 39,192 19 45 farm equipment 187,094 4 26 
Drugstores 9,229 9 12 Drugstores 86,169 -15 9 
Eating and drinking 37,016 2 18 Eating and drinking 204,473 -12 5 
Food 75 ,254 I 70 Food 477,490 -5 20 
Furniture, home Furniture, home 
furnishings 20,598 5 24 furnishings 136,426 -12 8 General merchandise 44,702 -36 8 General merchandise 274,241 -36 23 Liquor 5,920 -18 15 Liquor 44 ,727 -16 9 Miscellaneous retail 47,912 -13 -16 Miscellaneous retail 543,659 -17 28 
BEAUMONT-PORT ARTHUR-ORANGE SMSA EL PASO SMSA 
Apparel, accessories 7,853 -31 10 Apparel, accessories 13,943 -33 
Automotive dealers, Automotive dealers, 
service stations 76,142 8 12 service stations 128,093 5 3 Building materials, Building materials, 
farm equipment 18,956 9 18 farm equipment 11,721 2 14 Drugstores 13,353 5 8 Drugstores 10,904 -13 6 Eating and drinking 22,797 1 22 Eating and drinking 22,714 1 11 Food 74,328 8 5 Food 59,434 2 12 Furniture, ho me Furniture, home 
furnishings 14,422 -16 19 furnishings 16,548 8 4 General merchandise 40,451 -36 9 General merchandise 
50,023 -25 2 Liquor 4,537 -19 14 Liquor 4,747 -22 8 Miscellaneous retail 36,796 -15 -1 Miscellaneous retail 46,356 -13 -II 
BROWNSVILLE-HARLINGEN-SAN BENITO SMSA GALVESTON-TEXAS CITY SMSA Apparel, accessories 6,984 -16 -11 Apparel, accessories 4,425 -27 11 Automotive dealers, Automotive dealers, service stations 22,95 3 -2 4 service stations 129,389 -14 320 Building materials, Building materials, 
farm equipment 8 ,741 -20 10 farm equipment 8,572 3 14 Drugstores 3,357 -5 -13 Drugstores 5,075 -22 5 Eating and drinking 10,969 18 16 Eating and drinking 13,290 7 13 
Food 28,557 I 23 Food 36,139 -4 IS Furniture, home F urniture, home 
furnishings 6,203 -10 -7 furnishings 4,483 -12 14 General merchandise 25,962 -8 -10 General merchandise 13,678 -34 2 Liquor 1,008 -7 8 Liquor 2,458 -17 13 Miscellaneous retail 13 ,460 -17 -5 Miscellaneous retail 16,073 -14 6 
Reported area and kind of business  Jan-Mar 1977 ($000)  Percent change Jan-Mar 1977 from Oct-Dec 1976 Jan-Mar 1976  Reported area and kind of business  Jan-Mar 1977 ($000)  Percent change Jan-Mar 1977 from Oct-Dec 1976 Jan-Mar 19 76  
HOUSTON SMSA  McALLE  -PHARR-EDINBURG SMSA  
Apparel, accessories  96,S88  -2S  24  Apparel, accessories  8 ,741  -JS  7  
Automotive dealers,  Automotive dealers,  
service stalions  991,IOS  9  4  service statio ns  38,72S  s  2  
Building materials,  Building materials,  
farm equipment  220,977  9  26  farm eq uipment  13,61 9  -32  s  
Drugstores  71,186  -28  4  Drugstores  4,S29  14  4  
Ea ting and drinking  198,911  -12  20  Eating and drinking  11 ,701  17  IS  
Food  SOS,626  17  Food  44,113  s  39  
Furniture, home  Furniture, home  
furnishings  123,279  7  23  furn ishings  7 ,340  6  I  
General merchandise  308,436  -33  3  General merchandise  23,239  -18  -JO  
Liquor Miscellaneous retail  36,70S S78,789  -34 -11  11 31  Liquor Miscellaneous retail  933 44 ,303  -29 69  9 SS  
KILLEEN-TEMPLE SMSA  MIDLAND SMSA  
Apparel, accessories Automotive dealers, service stalions  s,419 28,783  -18 -3S  41 8  Apparel, accessories Automotive dealers, service stations  3 ,184 19 ,908  -24 ••  18 26  
Building materials, farm equipment Drugstores Eating and drinking Food  9,8SO 2,069 10,466 24,239  -2 -12 1 3  24 1 2S S7  Building materials, farm eq uipment Drugstores Eating and drinking Food  S,S37 4 ,727 4,839 13,743  7 -17 2 8  13 -4 I S 32  
Furniture, home  Furniture, home  
furnishings General merchandise  S,131 I S,617  7 -31  IS 14  furnishings General merchandise  4 ,166 8,948  s -2S  11 6  
Liquor Miscellaneous retail  780 I 0 ,388  -31 -18  -14 20  Liquor Miscellaneous retail  914 47,498  -24 -2  -2 36  
LAREDO SMSA  ODESSA SMSA  
Apparel, accessories  7,229  -16  -33  Apparel, accessories  4 ,107  -24  32  
Automotive dealers,  Auto motive dealers,  
service stations  12,911  17  12  service stations  42 ,6S7  6  
Building materials,  Building materials,  
farm equipment Drugs tores Eating and drinking Food  3,617 1,792 3,646 IS ,499  17 -23 •• -IS  19 -16 -3 13  farm equipment Drugstores Eating and drinking Food  8,038 1,S37 8,279 20,6S2  7 -23 4 3  s 3 13 17  
Furniture, home furnishings General merchandise Liquor Miscellaneous retail  S,S74 16,912 266 l l ,8S6  24 -12 -IO -17  -21 -19 33 -IS  Furniture, home furnishings General merchandise Liquor Miscellaneous retail  S,267 17,272 3,040 64,28S  8 -30 -28 I  17 6 4  
LONGVIEW SMSA Apparel , accessories Automotive dealers, service stations Building materials, fa rm equipment Drugstores Eating and drin king Food Furniture, home furnishings General merchandise  4 ,843 43,693 11,996 4 ,2S6 9,247 32 ,630 6 ,01 s 12 ,774  -34 8 -14 -6 24 -16 -3S  SAN ANGELO SMSA Apparel, accessories Automotive dealers, service stations Building materials, farm equipment Drugstores Eating and drinking Food Furniture, home furnishings General merchandise  2,S30 21 ,313 6,896 3 ,496 7 ,186 13,S S 7 3 ,372 8,8 S6  -26 31 •• -17 SS s 8 -37  2 1 22 -1 68 43 22 s  
Liquor Miscellaneo us retail  S,396 20 ,420  10 -13  Liquor Miscellaneous retail  743 6,430  -24 -10  11 27  
LUBBOCK SMSA  SAN ANTONIO SMSA  
Apparel, accessories  9 ,1 S2  -26  JO  Apparel , accessories  3 l ,9 S8  -28  12  
Automotive dealers, service stations  71 ,290  23  44  Automo tive dealers, service stations  229,096  -2  19  
Building materials, farm equipment Drugstores Eating and drinking Food  27 ,904 3 ,0S9 16,92 S 4 9,8 14  26 -11 -16 3  S2 -s 24 3S  Building materials, farm equipment Drugstores Eating and drinking Food  S0 ,0 8 1 16,93 1 6S ,S9 0 I S6 ,866  16 -s•• -2  24 11 10 48  
Furniture, home furnishings General merchandise  14,673 24,01 8  -16 -36  23 13  Furniture, home furnishings General merchandise  33 ,630 84 ,S64  -IS -3S  14 11  
Liquor Miscellaneous retail  4 ,3S4 38 ,S26  -13 -20  - 7 9  Liquor Miscellaneous retail  11 ,297 94 ,60 3  -- 22 18  34 9  

Reported area and  Jan-Mar 1977  Percent change Jan-Mar 1977 from  Reported area and  J an-Mar 1977  Percent change Jan-Mar 1977 fro m  
kind of business  ($000)  Oct-Dec 1976  Jan-Mar 1976  kind of business  ($000)  Oct-Dec 1976  Jan-Mar 1976  
SHERMAN-DENISON SMSA  TYLER SMSA (continued)  
Apparel, accessories  2,405  -36  12  Food  21,165  49  -10  
Automotive dealers,  Furniture, home  
service stations  19,606  - 4  32  furnishings  5,241  -29  16  
Building materials,  General merchandise  13,2 46  -31  24  
farm equipment  5,207  -31  22  Liquor  §  
Drugstores  2,723  -21  - 1  Miscellaneo us retail  14,15 1  -11  29  
Eating and drinking Food  3,936 14,535  - 5 7  4 42  WACO SMSA  
Furniture, home furn ishings  2 ,633  -20  ••  Apparel, accessories Automotive dealers,  4 ,146  -25  17  
General merchandise  8,970  -30  16  service stations  45,487  9  10  
Liquor  866  -28  14  Building m aterials,  
Miscellaneous retail  10,180  -10  41  farm equipment  20 ,650  6  16  
Drugstores  3,754  -11  12  
TEXARKANA  Eating and drinking  12,802  I  17  
Apparel, accessories  1,703  -35  11  Food  32 ,813  - 2  74  
Autom otive dealers,  Furniture, home  
service statio ns  20,64 7  26  58  furnish in gs  5,639  -11  20  
Building materials,  General m erchandise  I 5 ,364  -35  6  
farm equipment  7 ,463  -14  41  Liquor  1,660  -19  -16  
Drugstores  1,495  -11  5  Miseellaneous retail  20,383  -16  12  
Eating and drinking  3,761  I  16  
Food  13,420  -9  17  WICHITA FALLS SMSA  
Furniture, home  Apparel, accessories  4 ,086  -31  7  
furnishings  2,518  -33  -28  Automotive dealers,  
General merchandise  6,966  -37  4  service stations  35,264  - 8  8  
Liquor  §  Building m aterials,  
Miscellaneous retail  6,72 1  -6  18  farm equipment  8,598  -24  16  
Drugstores  5,079  5  68  
TYLER SMSA  Eating and drinking  8,343  2  7  
Apparel, accessories  5,792  -31  34  Food  22,339  5  42  
Autom otive dealers,  Furniture, home  
service stations  28,033  -17  25  furnishings  5,378  9  11  
Building m aterials,  General merchandise  12,963  -37  5  
farm equipment  13,440  -6  17  Liquo r  2,192  -10  9  
Drugstores Eating and drinking  3,002 6,777  -13 ••  9 25  Miscellaneous retail  17,990  -16  17  

§Omitted to avoid disclosure. **Absolute change is less than one half of 1 percent. ...No data, or inadequate basis for reporting. Source: Sales Tax Division, State Comptroller of Public Accounts. 

Barometers of Texas Business 

(AJI figures are for Texas unless otherwise indicated.) 
All indexes are based on the average months for 1967=100 except where o ther specification is made; all except annual indexe are adjusted for seasonal variation unless o therwise noted. Employment estimates are compiled by the Texas Employment Commi sion in ooperation with the Bureau of Labor Statistics of the U.S. Department of Labor. The symbols used below impose qualifications as indicated here: p-preliminary data subject to revision; r-revised data; *-dollar totals for the fiscal year to date; t-e.mployment data for wage and salary worker onl . 
Jul Jun Jul Year-to-<late average 1977 1977 1976 1977 1976 

GENERAL BUSINESS ACTIVITY  
Wholesale prices in U.S. (unadjusted index) ... ....... ... . .. .. . . Consumer prices in Houston (unadjusted index) .. . . .. . .. ..• .. . . Consumer prices in U.S. (unadjusted index) ... .. . .. . .. ... .•.. . . Sales of ordinary life insurance (index) . . ...... . . .. .... .. ... . .  194.8 191.6 182.6 272.3  194.4 181.8 301.6  184.3 177.4 I 71.J 249.0  192.7 188.0 J79.3 277.4  181.3 J74.6 168.6 247.0  
PRODUCTIO  
Total electric power use (index) . . . . . .... . .. . .. . ... . . . . .. . ..•  203.oP  200.3p  J 82.2r  205.0  183.0  
Residential electric power use (index) . ... . .... .. . ..... .... . .  230.3p  234.7p  208.3r  258.3  231.J  
Industrial electric power use (index) . . .. .. . . . . . ...... .... .. .  J 7 1.7P  168.6p  I 56.1 r  17 J .8  152.0  
Crude oil production (index) . . ... . . ... . .. .. . . . . • ... . . . . ....  101.4P  102.1 p  IOS.9r  102.4  107.1  
Average daily production per o il well (bbl.) .... .... . .. .. . .. . . . .  17.9  18.0  19.1  18.0  18.9  
Industrial production-total (index) .. ... ..... .. ... .... . . . . . . . Industrial production-total manufactures (index) . .... . . .. .. . .  139.8p 147.8p  J 39.4p 146.9p  13 I.Sr J 37.6r  137.4 144.S  J 31.S 137.0  
Industrial production-durable manufactures (index) . . .. . . .. . . Industrial production-nondurable manufactures (index) ...... .  I 53 .7p 143.2p  149.9p 144.Sp  139.0r 136.Sr  145.2 144.0  J 36.9 137.1  
Industrial production-mining (index) ... .. .. ..... ..... . ... . . Industrial production-utilities (index) . . . .. . .... . .. . . .. ... . . Industrial production in U.S. (index) .. .. ... ... . . . .. . . .... . . . . Urban building permits issued (index) ..... .... . . . . . . . . . . . . .. . New residential building authorized (index) ... . . . .. ... . . .. .. . New residential units authorized (index) . ... . . ... .... . . .... . . New nonresidential building authorized (unadjusted index) . . . . . .  117.0p l 73.2p 139.0p 29S.3p 354.3p J67.3p 244.3p  l l 7.6p I 73.2p I 38.3p 376.9p 449.0p 223.2p 314.9p  I J3.4r 162.9r J 30.7r 230.6r 253.8r 129.l r 191.lr  115 .3 179.8 J 35.9 293.6 349.S J75.9 241.4  113.9 168.9 128.6 231.S 237.4 127.4 222.8  
AGRICULTURE  
Prices received by farmers (unadjusted index) . . .. .. .. .... ..... .  184  195  194  
Prices paid by farmers in U.S. (unadjusted index) .... . ... ...... .  203  202  192  
Ratio of Texas farm prices received to U.S. prices paid  
by farmers . .. . . . . .... .. . ... .. .. . ... . .. . . ... ... . . .. . .. .  90.6  104.6r  96.S  101.0  
FINANCE  
Bank commercial loans outstanding (index) ....... . . . . . . .• ... ..  202.S  206.2  183.9  201.1  184.3  
Weekly condition report of large co mmercial banks,  
Dallas Federal Reserve District  
Loans (millions) ... . ... . .. . ... ..... ... ... .... .... . . . .. . $ Loans and investments (millio ns) ... ... . . . .... .......... . . . $ Adjusted demand deposits (millio ns) .. . ... .. ... . . .. .. . . . . . . . $  13,110 19,450 4 ,982  $ $ $  12,902 19,231 5,258  $ $ $  J 1,234 17,058 4,748  $ 12 ,478 $ 18,802 $ 5,108  $ 10,990 $ 16,665 $ 4,839  
Revenue receipts of the state comptroller (thousands) . ... . . . ... .. $  622.8  $  702.8  $  641.3  $ 634.9  $ 583.9  
Federal Internal Revenue collectio ns (millions) . . .. . .. .. .. . . .... $  J ,775.4  $  2 ,866.8  $  1,503.0  $18,S 12.8*  $ 14,279.1 *  
Securities registrations-original applications  
Mutual investment companies (thousands) .. .. .. .. . .... .. . . .. $  J08,222  $  72,97~  $  95,088  $ 982,534*  $ 728,805.  
AJl other corporate securities  
Texas companies (tho usands) .. ..... . .... . . .. . ... . .. ..... $  5,275  $  30,453  $  22,973  $ 160,095*  $ 145,035*  
Other companies (tho usands) . ... . . . .. . . . .. . . . . .. . ...•. . . $  10,288  $  28,608  $  9,175  $ 150,998*  $ 118,745.  
Securities registration -renewals  
Mutual investment companies (thousands) ... . .• ... .. .. . . . ... $  18,606  $  41,180  $  38,683  $ 461 ,939*  $ 450,599*  
Other corporate securities (thousands) ... .. •.......... .. .. .. $  356  $  350  $  740  $ 4,816*  $ 6,132*  
LABOR  
Total nonagricultural employment (index)t . . .. ... .. . .. . .... . . .  148.6p  148.6p  144.4r  148. 1  143.0  
Manufacturing employment (index)t .. . . .. ... . . . . . . .. . .. . . . Average weekly hours-manufacturing (index)t . . ....•. . ...•... . Average weekly earnings-manufacturing (index)t . . . . . ... . .. . . . . Total nonagricultural emplo yment (thousands)t . .. . . .. .. .. . ... . Total manufacturing emplo yment (thousands)t . . . . ..... . .... . Durable-goods emplo yment {thousands)t . . . .. .. . .. •... .... . Nondurable-goods emplo yment {thousands)t .. .. ... .. . . . ... .  l 32.9p 98.3p 200.6~ 4,845.8 89 l.6p 490.Sp 40 I.Ip  l 32 .3p 98.8p 200. 8~ 4,864.2 892.0p 492.2p 399.8p  J 29.4r 97.8r I 83 .6r 4,710.2r 868.1 r 475.8r 392.3r  132. 1 96.S 192.3 4,806.3 876.0 481.4 394.6  128.2 98.7 180.9 4,640.0 850.3 465 .S 384.8  
Total civilian labor force in selected labor market  
areas {thousands) .. ... . . . . ....... ....... . ... . . .. .. .... .  4 ,588.4p  4 ,591.8p  4 ,456.6r  4,500.3  4,349.8  
Na~~::rg~~~~~~des)'f'.~~~~~'. '.~ ~~l~~t·e·d· l·a~~~ ~~r-k~'. .. .. .... .. .  3,988.9p  3,98S .8p  3,845 .Sr  3,942.4  3,813.0  
Manufacturing emplo yment in selected labor market  
areas {thousands)t . . ..... . ...... .. ... ........ .... .. . .  733.0p  730.8p  7 I 7.7r  720.0  707.S  
Total unemployment in selected labor market areas  
{thousands) . . .. ...... . . ........ .... . . ... · · · · · · · · · · · · · · Percent of labor force unemployed in selected labor market areas ........ . .. ... .... ... . .... .. .... . . . . . .  252 .3p s.sP  261.0p S.7P  28 l.6r 6.3r  244.7 5.4  267.8 6.1  
Percent of total labor force unemployed .. ...... • ..... . . . .. ...  S.3P  S.4p  6.0r  5.2  5.9  

BUREAU OF BUSINESS RESEARCH SECOND-CLASS POSTAGE PAID AT AUSTIN, TEXAS THE UNIVERSITY OF TEXAS AT AUSTIN AUSTIN, TEXAS 78712