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Council members set to go forward with Vested Rights Ordinance

Wednesday, May 21, 2014 by Michael Kanin

Austin City Council members Tuesday indicated their collective intent to move ahead with a second reading of a contentious new set of grandfathering regulations at their Thursday meeting. Their action could include a vote on a set of proposals from Council Member Laura Morrison that would offer changes in how the city conducts its managed growth agreements – a tool used to direct the development of projects.


Meanwhile, some members of the Austin development community continue to worry that Council’s new grandfathering rules – known as the Vested Rights Ordinance – fall short of what they consider acceptable. Indeed, Real Estate Council of Austin President Ward Tisdale told the Monitor after Tuesday’s debate that an appeal to either the legislature or the courts remained on the table, should developers find the rules unacceptable. “We will strongly consider (legal and/or legislative action) if we have to,” he said.


The Vested Rights Ordinance is the result of a convoluted set of development-related legislative issues that go back to an accidental repeal by the Texas Legislature of state grandfathering provisions in the late 1990s. That inadvertent move found the City of Austin enacting its own grandfathering rules to replace those undone by the legislature.


When state legislators acted to replace their grandfathering rules, the City of Austin took no action to repeal its stop-gap measures. The result had been an often confusing set of regulations – until, under pressure from both the development community and Texas Attorney General Greg Abbott, the city moved to repeal its grandfathering rules last year.


City officials then embarked on a winding process to replace the rules in a way that would match state law, but leave closed potential loopholes that could undermine relatively strict environmental protections offered by such local rules as those contained in the Save Our Springs Ordinance. Indeed, Save Our Springs Alliance Executive Director Bill Bunch remains an active force in advocating for his interest as the new rules move forward.


Put simply, debate over the past few weeks has focused on the length of time a project would be eligible for preservation. Council members have considered a few options in that regard, including a flat nine-year limitation that would allow permits (as well as any grandfathered rules enjoyed by a project) to expire after nine years.


Tisdale and his colleagues have pushed to extend that figure, and to allow generally for more leeway for developers as they move through what can be a lengthy application process. Major projects, they argue, can take an extended period of time to develop, and should be granted room to maneuver as market changes impact construction.


Bunch and others argue that too much leeway undermines the environmental protections afforded by City of Austin regulations, some of the most restrictive in the state.


To further complicate matters, Texas legislators such as Rep. Paul Workman (R-Austin) have demonstrated a willingness to step in, should the city’s rules not pass muster in their eyes. Developers could also sue the city, should they find the new regulations acceptable.


Tuesday found Morrison introducing a set of Managed Growth Agreement-related amendments. Under her proposal, Managed Growth Agreements recommended by staff and the city’s Planning Commission and those that reach Council without those blessings would each have two sets of requirements. The first would earn those proposals the right to be considered. The second would be set criteria that would guide their eventual approval.


Entry requirements for recommended MGAs under Morrison’s proposal include a lack of grandfathering, “no non-administrative variances except for residential with site plan exemption,” that the projects be outside of the Barton Springs Zone, and that the developments be in the city’s extraterritorial jurisdiction. (Though Morrison’s plan would call for staff to work with Travis County to amend Title 30 to allow projects outside of the ETJ to be included in the regulations.)


Passage for recommended projects would be contingent on their taking a “long time to construct, that they further specific goals and policies of Imagine Austin,” and that the projects be environmentally superior to minimum standards.


Those applications, under the Morrison proposal, must be submitted at the same time as the project’s first application or before its review period expires.


Projects not winning staff and Planning Commission recommendation would have to submit Managed Growth Agreements at least a year before the project was set to expire. They would have to meet all criteria proposed for recommended projects, but also include requirements that they not “impede (or) delay” other “city initiatives related to economic growth or economic development.” These projects would also have to meet current code, unless, “under extraordinary circumstances, (they include) benefits and superior development that mitigates the (project’s) noncompliance with current code.”


There was no vote on those measures Tuesday. Still, Tisdale saw the additions as problematic.


“The proposed amendments by Council Member Morrison are very concerning to us,” he said. “Effectively they will render MGAs unattainable and that’s not good for our community. We want to be able to plan projects ahead of time–those unique ones that require careful thought–and the way the proposal is that she’s laid out, it’s going to be very, very difficult to meet those requirements, if not impossible.”


Council members indicated their intent to discuss the new vested rights rules on second reading at their Thursday meeting. Should they pass there, the rules would be ready for final passage in mid-June.

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