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Minority report seeks to solve gentrification problem

Thursday, April 8, 2004 by

More on findings of Historic Preservation task force

The report of the city Historic Preservation Task Force, which landed on Council members’ desks Monday, contains not only the expected recommendations on criteria for designating landmarks and reductions in property tax exemptions but also a “minority report” attempting to address gentrification within certain potential historic districts. Four of seven task force members and the ex-officio member signed the additional report.

Authors of the minority report agreed with the overall recommendations of task force (See In Fact Daily, April 7,2004.) but wanted specific incentives for lower-income areas. Although “the task force valiantly attempted to address the potential impacts of historic zoning to the preservation of mixed income neighborhoods and affordable housing in Austin,” they were unable to reach consensus on the issue, the minority report says.

“Unfortunately, by not incorporating a specific incentive to protect mixed-income neighborhoods or maintain a stock of affordable housing, the report embraces a ‘one size fits all’ approach to historic zoning. This fails to recognize the specific needs and diversity of urban neighborhoods that contribute significantly to the history of our community. Many of the residents of these neighborhoods are at or below the median family income, and remain dependent on the availability of affordable housing.” Signers of the minority report— John Donisi, Keith Jackson, Joseph Martinez, Tere O’Connell and ex officio member Laurie Limbacher—then expressed a fear that “adoption of the recommendations of the task force and included in the report alone may actually encourage and subsidize the displacement of these long-term residents.”

Their recommendation therefore was to enact additional incentives for homeowners in historic districts where a majority of residents fall at or below 80 percent of the median family income (MFI). Specifically, they suggested “a property tax exemption of 20 percent or $200 annually, whichever is greater, for a 10-year period” following historic designation.

The minority report writers noted that members of the Central East Austin Neighborhood Planning Team had asked the city to create such an incentive program in their December 2001 plan. A similar recommendation came from the Gentrification task force at the end of 2002. However, since the city took no action on establishment of historic districts, there was no specific opportunity to address those requests.

Austin Chronicle reporter Mike Clark-Madison served on the Central East Austin Neighborhood Planning Team. His own neighborhood, Swede Hill, is on the National Register of Historic Districts, he said. A survey by the Austin Revitalization Authority found eight potential historic districts in the East Austin area, including San Bernard Street and the Guadalupe neighborhood, Clark-Madison noted. The planning group believed historic abatements should be enhanced for areas within CBDG (Community Development Block Grant) target areas, which is what Dallas has done, Clark-Madison said. That is similar to the 80-percent level approved by the minority report writers.

According to numbers provided in the task force report, a historic home at 2408 Sweetbrush carries a city tax bill of $10,346. The current owner can expect to be excused from paying $8,279 of that, leaving a bill of under $2,000. If the house is sold, the maximum exemption would be 50 percent of the tax. The new owner would pay about $4,140. But in an eastside neighborhood, a historic home and lot at 1108 Chicon is valued at $60,000 with a resulting tax bill is only $283. Current rules exempt the owner from $190, leaving a tax bill of $93. If the minority report were adopted, the owner of a similarly priced home—not zoned historic—but in the same neighborhood would be able to apply for an exemption from $200 in city taxes. But that could happen only if the area were in a historic district and the homeowner fell into the poverty category (80 percent of Austin MFI). The house zoned H would keep its tax status until a new owner took over, at which time the new rules would apply. The owner of the neighboring non-historic home would be able to request the exemption for 10 years following the designation of the historic district.

Task force member Donisi said the burden of proof would be on the homeowner to prove. “Just like everybody else, they have the burden of showing the city that they’ve complied with the rules that currently exist for historic landmarks,” he said. “We’re not necessarily saying this is the only way to do it. We’re just saying we think the one size fits all,” approach could be improved.

City sales tax revenue making a comeback

While the latest sales tax figures from the State Comptroller’s Office do not point to a return to the runaway growth of the late 1990’s, they do show that Austin’s economy is on the rebound. The payment to the city for the month of February is $8.5 million, which is an improvement of 6.9 percent from the same period in 2003.

“Things are looking up,” concluded City Budget Officer Rudy Garza.“It’s been a long time since we’ve been at this point. We believe that the economy did hit rock bottom in Austin last year, and we’re starting to see the results of a small and slow turnaround.” Garza noted that the increase, while significant, was in comparison to one of the worst years on record for sales tax returns. The uptick puts the city ahead of the recently revised projection for a 4-percent increase for the current fiscal year, a relief to budget planners, Garza noted. “The last two years, one of the most difficult things we’ve done is mid-year budget reductions,” he said. “They aren’t pleasant and are very difficult to manage.” For the remaining seven months of the current fiscal year, the city will need to see an average increase of 3.5 percent in order to meet the revenue target.

Austin isn’t the only city experiencing an economic rebound. Dallas, Houston, San Antonio and Fort Worth are also showing increases compared to 2003. For February, Houston showed an astonishing 24.3 increase in sales tax revenues—but that was due in part to an audit adjustment of $1.3 million. Of course, the large influx of visitors for Super Bowl XXXVIII on February 1 probably helped a bit too. Dallas also showed a double-digit increase of 14.7 percent over the previous year.

Garza pledged that budget planners would continue to maintain vigilance in reviewing both revenues and expenditures. “While this is good news, and it does provide us with a little more flexibility in our planning, we still have to look at our other revenues and our expenses,” he said. “Our decisions that are ahead will be based on everything, not just sales tax revenues.”

Backers of health care district ready for campaign

McFadden stresses tax benefits for Austin residents

The campaign for the Travis County Healthcare District will gear up once the Republican and Democratic runoff elections are over on April 13, the campaign manager for the effort said last night.

Campaign manager Elliott McFadden presented the healthcare district vote to the Austin Progressive Alliance Wednesday night. The campaign has already gathered the endorsements of Seton and St. David’s health care systems, the League of Women Voters, the Travis County Democratic Party and 500 local physicians. McFadden said the campaign would heat up after next Tuesday.

“We just came off of a very intense primary,” McFadden said. “We had a presidential campaign, national issues and Congressional district races. That’s where the focus has been, and rightly so. Over the next weeks, though, you’re going to see more campaigning and more people informed.”

Volunteers have begun meeting with healthcare groups, civic groups and political caucuses. A website,, has been launched. In the coming weeks, more visible signs of the campaign—such as yard signs and mailers—should begin appearing around town. McFadden estimated that between $300,000 and $400,000 would be spent on the campaign before it’s over.

In his presentation last night, McFadden made two major arguments:

• About a quarter of the people in Travis County are uninsured, even though half of those people have jobs.

• Austin residents pay five times more than Travis County residents for healthcare.

McFadden described a number of different taxpayers—a Central Austin taxpayer living in a house valued at $190,000, a couple living in a $250,000 house in Pflugerville, a retired couple living in a $400,000 house in Lakeway and an attorney in Westlake living in a $1 million house—and asked who would pay the most taxes. The answer, of course, was that the Central Austin taxpayer paid the most for the healthcare system.

The creation of a healthcare district, run by a nine-member board appointed by the city and county, would immediately generate $6 million in revenue. That money would keep primary care clinics open, beef up the city’s trauma centers and underwrite the cost of some prescription drugs.

McFadden stressed that the campaign was a bipartisan effort. He said every member of the Travis County legislative delegation supported the initiative, with the exception of Rep. Todd Baxter (R-Austin).

No one was at the meeting in opposition to the healthcare district, although the Save Our Taxpayers organization was invited to the event.

Rep. Eddie Rodriguez (D-Austin) also was on hand at the meeting to explain the proposition on the ballot for collective bargaining for the city’s firefighters. Collective bargaining, allowed under law, would require the city to meet in good faith with firefighters to negotiate the firefighters’ contract. Collective bargaining, however, would not give the firefighters the right to strike.

A total of 18 cities in Texas have collective bargaining rights for firefighters, Rodriguez said. Houston voted for collective bargaining last year. Other cities include San Antonio, Laredo and Corpus Christi. Austin is the last Democratic stronghold in the state without collective bargaining rights, said Rodriguez, who recently took a job with the firefighters’ organization.

Early voting continues . . . A total of 3,204 Republicans, about .6 percent of registered voters in the county, have cast ballots in the runoff election so far. Five hundred seven Democrats have voted in their Constable Precinct 4 runoff. Friday is the final day of Early Voting. The election is next Tuesday . . . Other tidbits from the task force. . . The Historic Preservation Task Force was appointed, in part, because City Council members were not happy with what they were hearing about the Historic Landmark Commission. Specifically, some commissioners seemed inclined to grant historic status to almost any structure favored by the neighborhood for such treatment and to pay little attention to staff recommendations and property owners’ wishes. The task force recommended that the commission be cut from 11 to 9 members and that seven of those be accountable to a specific Council member. In addition, the task force suggested that terms be for two years instead of the current four and that no commissioner should serve more than eight years. All but one of the current members of the HLC will be up for reappointment in June—unless the Council decides to scrap the current commission and start over before then. The task force did not address that question, but they did suggest that members of the HLC, like the Zoning and Platting Commission, be subject to removal without cause by a vote of the Council . . . Austin firefighters help out in Houston . . . Houston firefighters buried one of their own yesterday and Austin’s firefighters staffed 12 Houston fire stations. That allowed friends of the firefighter who died, Kevin Kulow, to attend the memorial procession and service. Kulow died in the line of duty on April 4. Participating in the memorial procession on behalf of Austin Firefighters were Austin Fire Chief Garry Warren, AFA President Mike Martinez and the Austin Fire Department Honor Guard. Capitol Metro provided 3 passenger vans for travel to and from Houston . . . No meeting today . . . Neither the City Council nor any commission is meeting today. All seems quiet at City Hall . . . Aquifer district board meets tonight . . . Members of the Barton Springs Edwards Aquifer Conservation District board of directors are scheduled to meet at the district office at 6pm tonight. Among the controversial matters they might discuss is the sustainable yield model—what scientists determine to be the potential upper limit on pumping from the aquifer. Rep. Patrick Rose (D-Dripping Springs) and Sen. Jeff Wentworth (R-San Antonio) have questioned the need for such a study and suggested that the district not stand in the way of development. (See In Fact Daily, Feb. 27, 2004.)

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