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City studies possible changes in UNO fees

Tuesday, July 19, 2011 by Kimberly Reeves

The University Neighborhood Overlay (UNO) has been one of the city’s most successful programs for promoting affordable housing. But now, supporters of the initial UNO program are pushing hard to revise fee in-lieu terms to target beds, rather than units, in the district.


Council was looking for an evaluation of the UNO fee in-lieu after the district’s initial creation. According to the city’s website, Council requested an evaluation of the fee at the end of 2009. Neighborhood Housing and Community Development held two public stakeholder meetings last September. And, now, the Community Development Commission’s UNO Stakeholder Group appears poised to consider the issue.


The UNO fees, even more than the downtown density bonuses, appear to have spurred results because of the bump in construction UNO brought to the West University area. The city collected about $1.2 million in fees during the initial wave of construction. Just over $800,000 was used to construct College House’s student cooperative five-story Laurel House, with ICC Co-operatives possibly slated for a smaller project as funds coming to come into the UNO account.


With a city consultant’s report on the fee pending next month, Alan Robinson of College Houses told the Community Development Commission at last week’s meeting that the fee did accomplish its goal.


“We were able to use the money from the fee in-lieu for a 176-bed co-op, and it serves us well,” Robinson said. “We’re able to guarantee that it’s priced so someone at 50 percent of median family income or below is going to be able to live there. There’s also a guarantee of 20 percent lower income qualifiers, so we think that they’re all affordable units, created by fee in-lieu.”


More development and more beds in UNO equals more ability for affordable housing advocates like College Houses to put units on the ground in UNO. Following Robinson was UT Student Government senator John Lawler, who expressed his support for charging a per-bed fee and encouraged the CDC to consider the input of university students in its final fee in-lieu decision.


“West Campus shouldn’t just be a luxury where only rich kids can live,” Lawler said. “So, right now I’m very much in favor of a clear, easily readable picture of what is going to happen, so I can go back to my student government.”


CDC members appeared to actively encourage the input of the university community, most of whom are not expected to return until mid-August to participate in a discussion as to what might work for the fee in-lieu program.


In his comments, agent Mike McHone, who serves as vice president of University Area Partners, said that the goal of UNO is “to create a program that works for students.” That meant getting students into affordable housing, McHone said.


Students are not households in a traditional sense, McHone said. So it makes more sense to model in-lieu fees on the actual parameters of newer student housing projects, which markets and sells based on bedrooms rather than units.


McHone asked for more time to develop a plan to present to both the Community Development Commission and the Planning Commission that would fix the problems within UNO and would be designed to maximize student housing.


“There is no magic money for projects,” McHone said. “Every dollar that we put into projects is taken out of students’ pockets. Reaching that balance, we don’t want to create a situation that is untenable for the student residents. We don’t’ want to create a problem that stops development.”


The easiest sites in West Campus have been redeveloped, McHone told commissioners. At this point, developers are down to sites that have been harder to develop or institutionally owned. Any change in the fee structure needs to respect those factors, McHone said.


Quizzed by Vice Chair Karen Paup on issues to address, McHone said his group would be meeting this week on fee in-lieu. He noted that projects in West Campus already had two levels of affordability: mandated units within the project for moderate-income students and the fee in-lieu program to address lower income students who are looking for housing.


The process of calculating student income should be streamlined, McHone told Paup, with qualification for affordable housing being more sophisticated than the process the University of Texas set out for scholarships.

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