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Commission starts process on affordable housing incentive program

Monday, August 1, 2016 by Jack Craver

The city Planning Commission on Tuesday kicked off the creation of an amendment to Austin’s land development code to encourage developers to build more affordable housing.

The objective of the proposal, which is only in the beginning stages of being drafted, is to increase the number of properties for which the city can offer developers exemptions from some site-development regulations if they agree to build a certain amount of housing affordable to residents at a specified income level.

The code change centers on a relatively rare zoning designation: MF-6, or Multifamily Residence Highest Density. Those pushing the change argue that developers trying to build on properties that are currently zoned for less dense multifamily residences (MF-2, MF-3, MF-4 and MF-5) might be willing to offer a portion of their units at low prices if the city allows them to play by some of the MF-6 development rules, which are more flexible in terms of impervious cover, floor-to-area ratio, building coverage and setbacks.

The idea is hardly new. An ordinance approved by City Council in 2008 offered a certain number of exemptions to developers in exchange for affordable housing and compliance with SMART housing principles. But a passage in the ordinance specifies that the incentives are available only to construction on land that is either undeveloped or has only been used in the past for agriculture. According to those pushing the current reform, that clause killed any hope that the ordinance would do much for affordable housing.

Ironically, said Ron Thrower, a veteran development agent who is backing the change, in practice the current code encourages the creation of high-density apartment buildings in the suburbs, where they are not in demand and unlikely to be located near public transit, as SMART housing is intended to be.

Some housing advocates would like to see the sentence restricting the incentives to undeveloped land deleted and, ideally, replaced with one that directs the incentives to the urban core. Thrower suggested that the code offer incentives to developments within a half-mile of an activity corridor.

The new proposal comes two months after Council shelved a city staff-crafted ordinance after most members of the Planning Commission declined to recommend it, determining that it would not have much impact. Among other things, it would apply only to properties that are already zoned MF-6, of which there are fewer than 20 in the city.

Planning Commissioner Fayez Kazi, who brought forward the code amendment change along with Commissioner James Shieh, told the Austin Monitor on Thursday that he wanted to create “something that will provide affordable housing and not something that will just pretend to provide it.”

The new proposal is aimed at the many more lots zoned for MF-2, MF-3, MF-4 and MF-5, many of which currently house aging apartment buildings that will eventually be redeveloped.

“There are a lot of multifamily developments in this town that will redevelop soon no matter what,” said Commission Chair Stephen Oliver. “The question is under what conditions.”

Thrower emphasized that he is not aiming to grant developments increased building height, a change that would most likely provoke opposition from neighbors. He is confident that the proposed change will encounter opposition nevertheless. He has a relatively simple argument in response to would-be opponents: “If you’re opposed to this, then you’re opposed to affordable housing.”

Commissioner Nuria Zaragoza has not expressed opposition to the proposal, but she voiced concerns about incentives that might encourage developers to demolish housing that is “100 percent affordable” and replace it with buildings that consist mostly of luxury units and a small number of affordable ones.

“Our most significant source of affordability is our older housing stock,” she told the Monitor.

She is wary of the argument that it will soon be torn down anyway. “We hear that all the time,” she said. “They’re coming down anyway, so let’s get what we can.”

The commission barely addressed the substance of the proposal at its Tuesday meeting. Instead, it mostly debated whether to initiate the code amendment process immediately or to refer it to the Codes and Ordinances Joint Committee, which is made up of four Planning commissioners and three Zoning and Platting commissioners.

Kazi, a member of the Codes and Ordinances Committee, didn’t see much use for going through the committee process first. Neither did Commissioner James Schissler, also a member of the committee, who said he feared that the proposal wouldn’t be approved by the committee given the number of development skeptics on the panel.

But Zaragoza (also on the committee) argued in favor of going through the committee process, saying that was typically the way things were done. She also assured Schissler that even if the committee voted against the proposal, it could still come back to the full commission if two members wanted it to.

The commission narrowly rejected the motion to refer the item to committee on a vote of 5-6, with Zaragoza, Shieh and commissioners Karen McGraw, Patricia Seeger and Trinity White in favor and Kazi, Schissler, Oliver and commissioners Chito Vela, Tom Nuckols and Michael Wilson opposed. Commissioners Jeffrey Thompson and Angela Pineyro De Hoyos were absent.

Afterward, the commission voted overwhelmingly to initiate the code amendment, with only McGraw in dissent.

Photo courtesy of the city of Austin. The Austin Monitor’s work is made possible by donations from the community. Though our reporting covers donors from time to time, we are careful to keep business and editorial efforts separate while maintaining transparency. A complete list of donors is available here, and our code of ethics is explained here.

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