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Friday, February 17, 2017 by Caleb Pritchard

Plaza Saltillo advances amid accusations of broken promises

After years in the making, the Capital Metropolitan Transportation Authority’s Plaza Saltillo is only one vote away from its ultimate fate.

City Council on Thursday night gave second-reading approval to the zoning change that will clear the way for the project, albeit slightly shorter than the developer, Endeavor Real Estate Group, originally proposed.

The vote came after a fairly tortured discussion between Council members, staff, representatives from Endeavor and Capital Metro, as well as members of the public, including Jose Valera of the East Cesar Chavez Neighborhood Contact Team. The contact team has accused the developer of moving forward with a proposal different from what it had originally pitched.

Central to the dispute are the number of affordable housing units, as well as Endeavor’s promise that it would not seek any variances on top of what it put forward in 2014.

Council Member Leslie Pool distributed a transcript from a June 23, 2014, Capital Metro board meeting in which Endeavor principal Jason Thumlert said, “To address affordability, we have added a great partner in Austin Habitat for Humanity, and we are committing to providing 25 percent affordability” on the site.

As it stands, Endeavor’s proposal features only 15 percent affordable housing, something Thumlert maintains has been the true promise all along. He explained that he had used the larger figure with the understanding that the city would make up the difference, which is allowed in the site’s regulating plan.

Thumlert told Council, “We did not feel it was necessary to state that every time we discussed affordable housing. It was emphatically clear in our written proposal.”

That claim is backed up in a letter sent from Capital Metro CEO Linda Watson to Council last week. She said that Endeavor has been “consistent” in its plans and offered as proof a snippet from a Feb. 13, 2014, questionnaire used in the agency’s final evaluation of developer candidates: “The proposal does include 10% participation from the City of Austin, as described in the (site area plan). If the City does not fund its 10%, the Team shall still provide its 15% within the project.”

Habitat for Humanity’s director of operations, Greg Anderson, told the Austin Monitor that since he took the job in January 2015, Endeavor has made it clear it intended to build affordable housing at 15 percent while also pursuing the extra 10 percent from the city.

Mayor Pro Tem Kathie Tovo pointed out that, while the plan may not have changed, the decision to not be entirely forthright led to media reports in 2014 that featured the 25 percent figure. Those reports went unchallenged by both Capital Metro and Endeavor.

“I think that really is where the crux of the confusion is, in my mind,” said Tovo. “I think it seems pretty clear that (Endeavor’s true intentions) never made it into the public realm.”

The proposal has also drawn fire for the variance request to build a 125-foot office tower on the project’s westernmost side along I-35. Capital Metro Board Member Terry Mitchell told Council that Capital Metro asked the developer to include that feature in order to provide a large daytime population to stimulate ridership of MetroRail as well as the project’s retail and restaurant businesses.

However, Endeavor’s proposal excludes the office tower from its calculations for affordable housing, a violation of the regulating plan. Thumlert said that instead the developer is offering a fee-in-lieu for the square footage of that section.

If the tower is reduced to 70 feet, as Council has approved on both readings now, the fee-in-lieu will be dropped from $600,000 to $100,000.

City staff told Council that they had recommended the bending of the rules set by the regulating plan with the understanding that when the plan was written, factors such as the larger tower were not taken under consideration.

After further discussion, Council approved the item on a 9-2 vote, with Tovo and Pool in opposition. The third and final reading is scheduled for March 2.

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Key Players & Topics In This Article

affordable housing: This general term refers to housing that is affordable to Austinites, with or without subsidy.

Austin City Council: The Austin City Council is the body with legislative purview over the City of Austin. It offers policy direction, while the office of the City Manager implements administrative actions based on those policies. Until 2012, the body contained seven members, including the city's Mayor, all elected at-large. In 2012, City of Austin residents voted to change that system and now 10 members of the Council are elected based on geographic districts. The Mayor continues to be elected at-large.

CapMetro: Capital Metro provides bus and MetroRail (Red Line) service for the Austin region. It's governed by a seven-member board appointed by various governing entities, including City Council members. CapMetro is also governed by a President and CEO.

Plaza Saltillo: Capital Metro's 11-acre tract in East Austin is slated to be developed by Endeavor Real Estate Group after a 20-year process.

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