Council looks to change the ‘unhappy experience’ of DB90

City Council is preparing to initiate a broad review and recalibration of the city’s density bonus programs, including DB90, which was introduced last year as a tool to encourage the development of affordable housing through additional entitlements.

The resolution, which is scheduled to be taken up at the June 5 Council meeting, is sponsored by Mayor Kirk Watson and directs city staff to explore structural changes to the bonus programs, which are intended to allow more development entitlements in exchange for various community benefits, like affordable housing. The programs face increasing scrutiny for under-delivering on affordability goals and creating unintended consequences in areas with naturally occurring affordable housing.

Watson acknowledged last week that DB90 has not worked as intended, describing it in a recent message board post as “an unhappy experience.” He said the program has become difficult to use as intended and is increasingly divisive, particularly in cases where existing affordable housing is at risk of being demolished in exchange for new development with limited affordability set-asides.

The forthcoming resolution calls for the creation of a range of new density bonus districts with varying entitlements and affordability requirements, giving staff the flexibility to rethink how the city balances height, affordability and development incentives.

Council Member Marc Duchen, who has been vocal in recent weeks about the shortcomings of DB90, told the Austin Monitor that he will propose several amendments to the resolution to preserve affordability and prevent displacement. In both the interview (and in multiple public posts), Duchen outlined concerns that DB90 applies a one-size-fits-all affordability requirement that does not reflect the economics of different development types.

He argued that the program’s flat 10 to 12 percent affordability standard fails to account for the stepped nature of building designs like the so-called Texas donut or podium-style developments, where the cost and density scale up in discrete increments. According to Duchen, this misalignment discourages deeper affordability and may inadvertently encourage the redevelopment of low-cost housing without adequate replacement.

“It’s rewarding you linearly, as opposed to stepping up to a plateau of greater density,” he told the Monitor. “My hope, when I heard that somebody is working on changing the height requirements, is they would be approaching it to say, ‘If you’re building a Texas donut and it’s gonna be five stories, we’re going to calibrate it based on being able to maximize out the affordability with a sort of economy-of-scale at five stories using that design archetype,’ as opposed to if you had gone to seven stories using the podium development.”

Duchen has also pointed to enforcement gaps, citing cases in which developers have taken advantage of DB90 entitlements without delivering the promised affordable units. He said the city needs to improve monitoring and create consequences for failing to comply with program requirements. He plans to introduce amendments that would restore stronger affordability standards, require on-site relocation support for displaced residents, increase financial assistance for tenants who must move, and tighten restrictions on when DB90 can be used.

Duchen and others have characterized DB90 as increasingly becoming the preferred zoning mechanism for developers because of its relatively low affordability burden, noting that some applicants have altered their base zoning specifically to become eligible for the program.

In parallel with these regulatory changes, Duchen said he is also developing a proposal to establish a housing affordability fund focused on preserving naturally occurring affordable housing. Modeled on similar efforts in cities like Dallas, Texas and Charlotte, North Carolina, the fund would use public seed money (potentially from the city’s unspent 2022 housing bond or Project Connect’s anti-displacement funding) to attract private capital and acquire or preserve low-income multifamily properties. The goal of that fund would be to provide a financial mechanism to intervene in cases where affordable units could be lost through redevelopment.

In public remarks and message board postings, Watson has emphasized the need for a more flexible and responsive set of density bonus tools. While he has not laid out specific policy proposals, he has called for a more holistic approach that allows staff to consider affordability levels, redevelopment requirements, and commercial standards in evaluating future programs. He said the intent of the resolution is to give staff wide latitude to propose improvements, rather than prescribe a single path forward.

“This is not a condemnation of density bonus programs. We need greater density to achieve the goal of more housing. However, each week, we hear from community members concerned about the impacts of DB90 on their neighborhoods with no alternative. Density bonus programs are meant to better assure affordable housing and community benefits from developments that are already occurring in our rapidly growing city. The unintended consequences we’re seeing need to be addressed,” Watson wrote in a recent message board post.

Photo made available through a Creative Commons license.

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