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City offices split over affordable housing calculations for South Lamar PUD

Tuesday, May 14, 2013 by Elizabeth Pagano

A strong disagreement over the calculation of affordability requirements among city staff has emerged, adding to the controversy over a proposed Planned Unit Development at 211 South Lamar.


At issue is the South Lamar PUD, which has drawn the ire of several neighborhood groups (See In Fact Daily, April 17), though a postponement at the Planning Commission has kept it out of trouble for several weeks. Developer Post Paggi is seeking PUD zoning for its 211 South Lamar lot, currently the site of a Taco Cabana and the Paggi House restaurant. The zoning change would allow them to build a residential tower to 96 feet instead of the current 60-foot limit.


In return, they offer many community benefits, including money (or space) dedicated towards affordable housing.


Surprisingly, developers have interpreted the code more strictly than the city’s Planning and Development Review Department, offering 10 times the amount of money as a fee in lieu.


In a memo obtained by In Fact Daily dated May 9, Neighborhood Housing and Community Development Director Betsy Spencer breaks down the three calculated fees-in-lieu that vary widely between sources.


The lowest calculated fee, by far, is from the Planning and Development Review Department. That fee was based on 10 percent of the bonus square footage – or 10 percent of the square footage that is gained as a direct result of the zoning change. According to that formula, developers are responsible for paying $43,890 as a fee-in-lieu.


The developer’s calculation is ten times that estimate, and based on the overall bonus square footage. They calculate the fee-in-lieu at $438,924.


NHCD interprets the code differently, and recommends a fee-in-lieu based on the total square footage of the PUD. According to their calculations, the developers should be paying more than $1.2 million as a fee-in-lieu.


Why the confusion?


Currently, the lot has entitlements that would allow them to build 130,051 square feet. If the city grants PUD zoning, that square footage will increase by 73,154 sq. ft.  Both Planning and Development Review and the developer use that number to calculate their fees in lieu, while NHCD interprets the code differently, and they base their calculation on the total square footage of the PUD.


In her memo, Spencer explains, “As the ordinance is currently written, the calculation for determining number of affordable units is based on the total number of units or total habitable square footage within the PUD. The fee in lieu donation is the established fee multiplied by

each square foot of climate controlled space within the PUD. The ordinance designates this square footage as both residential and non-residential square footage.”


Spencer goes on to recommend that the city maximize the affordable housing tools currently in place, and a fee in lieu “that is aligned with the strictest interpretation of the PUD ordinance.”


It’s likely that she won’t be alone in this interpretation when the case goes before the Planning Commission tonight. Recent attention to the codification of the Downtown Density Bonus program has drawn attention to the zoning process and its effect on the city’s Affordable Housing Trust Fund. As a result, groups like Austin Interfaith have taken a stand on the issue, promising to participate in zoning cases that have an affordable housing component.


All of this would be moot, of course, if Council fails to grant the zoning change as some neighborhood advocates have sought.

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