Texarkana could lose federal status, funding in possible MSA move

TEXARKANA — Friday is the deadline for public comment on a federal government proposal to change how U.S. cities are officially defined, and local government and business leaders are encouraging residents to make their voices heard.

If approved, the change would remove the combined Texarkanas and 143 other U.S. municipalities from the ranks of Metropolitan Statistical Areas, or MSAs. The designation affects federal funding for programs such as housing, transportation and Medicare reimbursement and, economic development advocates say, makes cities more attractive to new businesses.

Earlier this month, an Office of Management and Budget committee recommended that the population threshold for MSA status should be increased from 50,000 to 100,000 in the main cities of each. Though the Texarkana MSA comprises all of Bowie County, Texas, and Miller County, Arkansas, the OMB lists its core city population as 78,162.

The status shift could put Texarkana, Arkansas, on a slippery slope toward decreased federal funding, including Community Development Block Grants issued by the Department of Housing and Urban Development, a common form of paying for municipal programs and infrastructure improvements, City Manager Kenny Haskin said.

“If the MSA is changed, it could affect formula grants such as the city’s CDBG entitlement grant. Though they say it will not change any formulas, this change could potentially be a first step leading down that path. Everything has a domino effect, and the powers that be might not quite understand how unilaterally making these kind of decisions without local input can be damaging to small cities such as ours that are already struggling economically,” Haskin said.

Texas-side Assistant City Manager David Orr shares Haskin’s concern about direct allocation formulas, including those that determine CDBG and federal transportation funding. The city is working with the Texarkana Chamber of Commerce and Metropolitan Planning Organization, as well as the AR-TEX Council of Governments, on a regional response to the proposed rule, he said.

In a letter to the OMB opposing the change, Texas-side Mayor Bob Bruggeman argued that it would disrupt data consistency needed for long-term planning, as well as possibly decreasing federal funding.

“Although OMB has made changes to the statistical program in the past, removing MSA designation for 140 medium-sized cities would make it more difficult to allocate federal aid to the places where it is needed most.

“Maintaining consistency in the MSA program is also helpful for local governments and businesses who depend on long-term trend data to better understand the economies in these areas. Having consistent, long term data sets can be invaluable to businesses by giving them the tools to easily compare changes in labor markets and an area’s economic conditions,” the letter states.

Losing MSA status could also affect perceptions about cities trying to attract new businesses and jobs, Nancy Potok, a former chief statistician of the OMB who helped develop the new recommendations, told the Associated Press.

“There are winners and losers when you change these designations,” Potok said. “A typical complaint comes from economic development when you are trying to attract investments. You want to say you are part of a dynamic MSA. There’s a perception associated with it. If your area gets dumped out of an MSA, then you feel disadvantaged.”

Robb Sitterley, president and CEO of AR-TX REDI, an economic development organization here echoed that concern in comments to the Gazette on Saturday.

“Obviously this is something we don’t want to happen. It would make it more difficult to recruit companies,” he said.

Mike Malone, president of the Texarkana USA Chamber of Commerce, has been leading the local effort to join a nationwide campaign of objection to the change.

“I’ve talked to chambers from north to south and east and west, from Montana to Maryland, Washington and Wyoming, all up and down the seaboard, rallying the troops for this. I have not run into anybody that disagrees with our idea that we should keep where we are,” he said.

Malone too said MSA status is attractive to business and has a stimulating effect on the local economy.

“It’s an indication that it is a solid, growing area. It’s an indication that we’re doing more than just hanging out an ‘open’ sign on the sidewalk, that we’re actually engaged in growing the community. And it means that we’re actively engaged in seeking additional resources.

“Economically, it does allow our municipalities within our area to take advantage of those government matching funds and supporting funds that are out there with a lot more ease and attract a lot more dollars. Without the MSA, our cities are put in a quandary. They have to compete on a larger scale to attract money to help meet those needs that are important for any business coming to an area,” he said.

Those wishing to comment on the proposal may do so electronically via the federal government website regulations.gov. Type “OMB-2021-0001” — including quotation marks — in the Comment or Submission search box, click “Go,” and follow the instructions for submitting comments. Comments received by Friday will be included as part of the official record and available to the public.