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Jo Clifton is the Politics Editor for the Austin Monitor.
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Wednesday, May 3, 2017 by Jo Clifton
Bills threaten Austin’s land use plans
Brie Franco, the city of Austin’s chief legislative strategist, gave City Council a brief update at Tuesday’s work session before rushing off to do some last minute lobbying.
The city is facing a number of legislative attempts to curb its powers in the area of land use, Franco explained. That includes House Bill 2959 and HB 4033, both by state Rep. Jason Isaac (R-Dripping Springs).
HB 2959, which was sent to the House Calendars Committee this week, would require Austin Water to provide wholesale water and sewer service to an area of Hays County known as Hays City. Austin has opposed providing water and sewer service to the development over the Barton Springs section of the Edwards Aquifer for many years, believing that such service only aids in development over sensitive watersheds.
The city opposes HB 4033 because of its possible impact on the city’s ability to set affordable housing requirements within homestead preservation districts.
Rebecca Giello, assistant director of the city’s Neighborhood Housing and Community Development Department, spoke with the Austin Monitor while awaiting the start of a meeting of the Texas House of Representatives Urban Affairs Committee, which had HB 4033 on its agenda. Giello said the bill is referred to as anti-inclusionary zoning legislation.
Inclusionary zoning has been defined by the Furman Center for Real Estate and Urban Policy as “an affordable housing tool that links the production of affordable housing to the production of market-rate housing. (Such) policies either require or encourage new residential developments to make a certain percentage of the housing units affordable to low- or moderate-income residents.”
For example, San Francisco’s inclusionary housing program requires developers of projects with 10 units or more to either pay a fee for affordable housing or to sell or rent a percentage of their units below market rate at a price that is affordable for low- or middle-income households.
Neither Austin nor any other city in Texas has such a program, but some members of Council have indicated that they would be interested in exploring the idea in homestead preservation districts.
Last year, Oregon approved inclusionary zoning, leaving Texas and Tennessee as the only states in the nation to prohibit it. (Nashville, Tennessee, has a program much like Austin’s density bonus program, but it calls it inclusionary zoning.)
There is no doubt that Texas law does not allow for inclusionary zoning for the vast majority of housing. However, Giello said some housing advocates have argued that current law would allow for inclusionary zoning within homestead preservation districts. Isaac’s bill would remove that possibility altogether, she said.
Such legislation would remove a tool from the city’s affordable housing tool box, she added.
Giello compared inclusionary zoning to density bonuses, which are currently used by the city. Density bonuses are voluntary fees that developers pay in return for greater height or density on a particular project. Alternatively, the developer may decide to include affordable on-site housing.
“Some people call that voluntary inclusionary zoning,” she said. If HB 4033 were to pass, “there would be no way for the city to explore inclusionary zoning in (Homestead Preservation) District A.”
That district includes the Martin Luther King Jr. Blvd. and Plaza Saltillo transit-oriented developments, Upper Boggy Creek, Central East Austin, and the Chestnut, Rosewood, Govalle, Holly, and East Cesar Chavez neighborhood planning areas.
If the city were to decide to pursue inclusionary zoning within a homestead preservation district, first they would do a study to see whether new housing was having “a disparate impact,” or driving out the people who had been living there for years but could no longer afford to do so. If that turned out to be the case, the city then might try to help mitigate the displacement.
However, Giello said the city was “a long ways off from doing inclusionary zoning,” having not even started the study.
Franco also pointed out to Council that HB 898 by state Rep. Paul Workman (R-Austin), would establish unequal treatment for the city when it has a disagreement with a landowner or developer over vesting or grandfathering rights under Chapter 245 of the Local Government Code.
The bill, Franco explained, would allow a developer who wins a Chapter 245 case in court to recover attorneys fees from the city, but not allow the city to get its attorneys fees from the developer if the city were victorious in court. It also creates a mediation requirement and starts a clock on the mediation, she said.
As of Tuesday, the bill had been sent to the House Calendars Committee on its way to the House floor. Franco noted that May 8 is the last day for House committees to report bills out of committee.
At the moment of course, the most significant thing that remains for House members and senators is passing a budget. May 29 is the last day of the session and, with a budget approved, members of both houses can go home – clearing up the uncertainty that surrounds these smaller bills that could impact the city.
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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 Water Utility: AWU is the municipal utility that provides water service for the City of Austin.
City of Austin Downtown Density Bonus: The downtown density bonus program was approved as part of the city's 2011 Downtown Austin Plan. The program is a way that developers can earn additional height and density by providing community benefits, most notably affordable housing or money towards affordable housing.
City of Austin Neighborhood Housing and Community Development Department: This city department provides housing and community development services for Austinites. To that end, they administer programs, provide grant services, and work with non-profit and agencies to provide housing for eligible residents. The department also provides small business development services.
Homestead Preservation District: Legislation passed in 2005 created Homestead Preservation Districts. In order to qualify to become an HPD, the poverty rate for the area must be twice the city’s poverty rate.