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County hopes to offset proposed courthouse’s cost

Wednesday, July 1, 2015 by Caleb Pritchard

Efforts to offset a chunk of the cost of Travis County’s proposed $292 million Civil & Family Courts Complex could be worth nearly $80 million, according to county staff.

Project manager Belinda Powell revealed her estimates to the Commissioners Court during its regular voting session on Tuesday.

Powell told the commissioners that revenue from four potential offset strategies could range between $45.5 million and $78.7 million over the course of 20 years.

The proposals include charging for new parking facilities on evenings and weekends, selling three county-owned downtown properties, and allowing a private developer to build a second tower on the site at West Fourth and Guadalupe streets. In addition to generating revenue from leasing the air rights, the second tower would also generate money through property taxes.

Genevieve van Cleve, the leader of the campaign supporting the bond package, issued a statement Tuesday afternoon underscoring the need to replace the aging Heman Marion Sweatt Courthouse. “Unlike the State of Texas, who’ll let a bridge fall on you on IH-35 or a chemical plant blow up in your backyard, Travis County is not willing to allow its residents to continue to languish in the overwhelmed and unsafe hallways and courtrooms of the current courthouse,” said van Cleve. “The County’s proposed offsets to this project … are a solid example of putting the needs of Travis County children and families first in a financially responsible way.”

Publicizing of the estimated offsets suggests recognition by the Commissioners Court and supporters of the courts complex that voters likely won’t be eager to approve higher taxes for building the courthouse. The Austin Bar Association, which is one of those supporters, estimates that the owner of a home worth $325,000 will pay an extra $42 per year to cover the cost of the downtown complex.

During Tuesday’s briefing, County Judge Sarah Eckhardt acknowledged that the largest individual driver of the offsets will happen regardless of whether voters approve of the bonds. The sale of three downtown properties – Palm Square on the I-35 frontage road, the Executive Office Building at 411 W. 13th St. and the vehicle service station at West 10th Street and North Lamar Boulevard – could net between $20.7 million and $36.64 million.

Eckhardt noted that the liquidation of those properties – despite the fact that it would proceed independently of the courts-complex vote – helps deflect one argument wielded by opponents of the bond, namely that the county should move its services outside of downtown Austin.

“Starting back in 1991, we have moved nearly a thousand employees out of the central business district and are looking to move additional employees outside the central business district to the Airport Boulevard campus as we redevelop it, which is the reason why we can sell the 10th Street gas station, the Executive Office Building and Palm Square,” Eckhardt said.

Eckhardt also preemptively addressed another common argument –
that the courts complex itself should be built outside of downtown. Eckhardt pointed out that the projected revenue from the air rights, property taxes and new parking would be lower if the complex weren’t in the central business district.

“Remember that part of this is related to the density that you can develop on this block, and that’s directly attributable to it being in the downtown core,” Eckhardt said.

The large difference in Powell’s range of predictions is attributable to the early stages of the fact-finding process. Last week, the Commissioners Court voted to invite real estate developers to a special forum in July to open discussions on the possibilities for the development of the second tower. Powell told the commissioners that she would use information gleaned from the forum to refine her projections. She pledged to return at the end of the month with those new numbers.

Photo by Stephen Depolo made available through a Creative Commons 2.0 license.

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