Friday, July 28, 2017 by Caleb Pritchard

County still wants a piece of the ‘downtown puzzle’

Travis County got cut out of Mayor Steve Adler’s so-called “downtown puzzle” plan, and County Judge Sarah Eckhardt has let it be known that she eventually wants back in.

On Wednesday, Eckhardt sent a letter to Adler and City Council conceding that Adler’s plans to fund an expansion of the Austin Convention Center with a hike in the Hotel Occupancy Tax would preclude the county from getting its hands on tourist-sourced revenue for now. But she offered a new proposal that would by 2021 begin to channel some of that money into projects in Northeast Austin.

“Concentrated investment in the ‘eastern crescent’ would serve our common goal of promoting equity, opportunity, and prosperity in a historically neglected area that could be transformative,” Eckhardt wrote.

She proposed that the city and county work to create a joint venue district and use the resulting revenue to upgrade the Travis County Exposition Center, Walter E. Long Metropolitan Park and the Colony Park Neighborhood.

Her letter came after a 3-0-1 vote by the Commissioners Court on Tuesday to open up negotiations with the city. Commissioner Margaret Gómez abstained and Commissioner Jeff Travillion was not at the meeting.

The vote took place after Adler’s recent unveiling of his proposal to raise the city’s HOT rate by 2 percent in order to fund the convention center expansion. Another piece of the “downtown puzzle” would see large hotels collect an extra 1 percent assessment on their rooms through the creation of a tourism public improvement district. That money would be used to tackle homelessness in downtown Austin.

Under state law, the cumulative local HOT rate set by the state, county and city cannot be higher than 17 percent. It currently sits at 15 percent, which means Adler’s plan would max it out. The court, which currently does not collect any HOT, had previously expressed interest in laying a claim to the remaining available share.

However, it is expected that by 2021 another 2 percent will become available as the share that the city is using to pay off the 1999 convention center expansion will have reached defeasance. It is that 2 percent that Eckhardt and the court are hoping the proposed venue district would be able to collect.

The district’s creation would require voter approval, as would any specific projects to be funded by its revenues. In her letter, Eckhardt suggested the city and county begin collaborating on both of those efforts. She also asked the city to renew the county’s lease on the exposition center for another 50 years.

On Tuesday, Commissioner Brigid Shea encouraged her Council colleagues to think of the larger community.

“I certainly have picked up a lot of sentiment from people about a concern about having a concentration of all this money just in this small area in the downtown,” said Shea.

Gómez asked whether the revenues could be used to help finance affordable housing. Eckhardt explained that state law restricts the money for projects related to tourism, but she added that new investments around the exposition center could provide an economic boost to the surrounding area.

However, Gómez still declined to vote one way or the other.

“I guess I’d feel more comfortable if I knew how that additional revenue would help the people who are being displaced,” she said.

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Photo by Dtobias (Own work) [CC BY-SA 3.0 or GFDL], via Wikimedia Commons.

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Key Players & Topics In This Article

Hotel Occupancy Tax: A tax on the rental of a room in a hotel or other rental properties (including apartments) that cost 6 percent of the cost of a room.

Travis County Commissioners Court: The legislative body for Travis County. It includes representatives from the four Travis County Precincts, as well as the County Judge. The County Judge serves as the chair of the Court.

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