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Developers may seek municipal style powers in Southeast Travis County

Friday, March 13, 2009 by Kimberly Reeves

The developers of the 2,900-acre Carma Easton tract in Southeast Travis County are seeking legislative approval for additional authority—akin to what a Municipal Utility District has—certainly beyond what is typically approved by the city or county. A bill to give them such authority must be filed at the Legislature by the end of business today.


City of Austin Environmental Officer Pat Murphy reported the proposal to Council on Thursday, while carefully remaining neutral. He explained that various developers are supporting the proposal this session for the large acreage in the Desired Development Zone. Although the Council asked questions, they took no official position.


Murphy described the size of the district as roughly the distance between the Colorado River and Koenig Lane, bounded by Interstate 35 and MoPac. Mayor Will Wynn said downtown, roughly, was 1,000 acres. This project, Wynn said, would be measurably larger than that.


Murphy called the massive proposed district – about four times the size of Mueller — a “one of a kind” proposal, one that gives developers many of the same powers as municipalities. Assistant City Attorney Sharon Smith told Council Member Laura Morrison the district was intended to operate as closely to a municipality as possible.


The proposal goes above and beyond proposed legislation to grant powers on land around State Highway 130 land, by Sen. Kirk Watson (D-Austin) last session, as presented by city staff.


The legislation would give landowners oversight of the large-scale project and the ability to approve actions such as annexation, debt service and eminent domain. It also appears to give landowners – or at least the board representing the proposed district — the ability to collect and spend taxes.


Murphy expressed no preference on such an unprecedented move, and Council took no vote on the ability of a developer to have municipal-like powers. Murphy said this is a new type of district unique to the state and one that the city staff continues to grapple with in discussions with the landowners.


City staff has had questions about the composition of the governing board, Murphy said. It has been a common understanding the district might continue to carry – and pay on – its own debt, even after it is annexed into the city, Murphy said. The proposal is a limited district, even after annexation, that could impose ongoing debt. The city would have a limited say so in what taxes would be.


Asked by Council Member Sheryl Cole what the differences between the proposed SH 130 district last session and the current proposed 2,900-acre district might be, Smith said the main differences were control: The city, and its representatives, controlled the SH 130 district, while developers proposed tight control over the proposed new development district.


Of the proposed Carma Easton board, four of the seven members would be developers. The board would include at least one representative, and possibly two at one point, if the district grows, according to the staff presentation.


Cole wanted to be assured the city had debt protection, and as a sense that the city would not be picking up the infrastructure debt, which Smith estimated at somewhere around $80 million. Wastewater infrastructure would be $64 million. Murphy said the extension of William Cannon Lane would fall to developers.


This area is contiguous to city limits. Could the city afford to annex this area and afford development in this area? Murphy said it was difficult to imagine the city could afford extending services to the area.


Council could choose to revisit the legislation, which must be filed by the end of the day today. Murphy said the city was still in discussions with Carma.

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