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Council adopts new Density Bonus Program for Downtown zoning

Tuesday, July 2, 2013 by Elizabeth Pagano

(An error in the previous version of this story has been corrected.)

On a 6-0 vote last week, the City Council adopted a brand new Density Bonus Program for extra height and density downtown.


The new program will go into effect on July 8, replacing both the interim density bonus plan (which was established in 2008 and never used) and the option of using Central Urban, or CURE, zoning as a way to get additional height and density.


The program is part of the larger Downtown Austin Plan, which was passed in December 2011. In March, City Council asked that the bonus program be codified quickly. In May, Council passed an additional resolution that will take CURE off the table for developers once the program goes into effect on Monday.


Council approved the program unanimously, with Council Member Bill Spelman absent. The streamlined program will only apply to residential projects. Those building hotels and office buildings will not be required to participate, although that will be reevaluated in three years.


The city will also reevaluate the fees-in-lieu and on-site affordability standards in three years. As of Monday, developers will have to earn at least half of their bonus square footage through affordable housing community benefits, with the remainder achieved through community benefits such as open space or public art. Developers will also have to meet gatekeeper requirements which stipulate design standards, participation in the Great Streets Program and green building standards.


Under the new program, developers will pay $10 for every square foot of bonus space gained by increased zoning in the core of Downtown (roughly bordered by Lady Bird Lake and 11th Street, between Trinity and Guadalupe Street.) That figure drops to $5 in the Rainey Street and Lower Shoal Creek Districts, and $3 in the rest of downtown. (Rainey Street already has a program, and it was clarified that the new density bonus program would not interfere with those standards.)


Developers can also choose to provide on-site affordable housing. In that case, they must provide rental units at 80 percent of median family income (MFI) for at least 40 years, or offer owned units at 120 percent MFI for at least 99 years. According to this formula, they will get 10 square feet of bonus area for every one square foot off affordable housing provided on site.


Downtown Austin Alliance Executive Director Charlie Betts told Council that while they had been concerned that the program would be a disincentive additional density, they accepted the conclusions of the economic modeling. Betts said that the DAA supported the draft ordinance, and only asked for one change – that money generated by the program be directed towards housing for permanent supportive housing for the chronically homeless.


“We would not feel it necessary to designate that if the previous track record for the last three years had not pretty much ignored that specific population,” said Betts.


The idea of directing funds towards the city’s poorest residents had traction on the dais. After an explanation from the Neighborhood Housing and Community Development Department, which stressed the need for flexibility in spending on affordable housing, City Council passed language that directed funds from the program to permanent supportive housing for low-barrier approaches for the chronic homeless.(This section has been corrected.)

. That strategy, also, will be reconsidered in three years.


“We simply have not been successful. And if we are the least bit confused about whether we have been successful, we simply only need to take a stroll downtown next to the ARCH and trip over the people that we have not been able to place,” said Mayor Pro Tem Sheryl Cole, who made the motion to prioritize housing for the homeless with money from the program.

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