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Low-income housing project advancing in Northwest Austin

Thursday, September 27, 2018 by Jack Craver

An affordable housing development that has drawn fierce opposition from nearby residents in North Austin is one step closer to realization.

The proposed Elysium Grand apartments at 3300 Oak Creek Drive, just west of MoPac Expressway, will include 90 units. Only 21 units will have no income restrictions, while 17 will be restricted to households at 60 percent of the median family income ($43,980 for three people), 40 to those at 50 percent MFI ($36,650) and 12 units to those at 30 percent MFI ($22,000).

The development also includes 25 Veterans Affairs Supportive Housing vouchers provided by the Department of Housing and Urban Development, meaning up to 25 of the units will be prioritized for homeless veterans.

The project is a partnership between Saigebrook Development, a for-profit developer that specializes in affordable housing projects, and the Housing Authority of the City of Austin. The Austin Housing Finance Corporation is the driving force behind the $17.7 million project. It is issuing $9.8 million in private activity bonds as well as providing $3.3 million in direct subsidies. The development is also being financed by $3.6 million in noncompetitive 4 percent state tax credits.

Finally, the developer is seeking a property tax abatement from the Travis Central Appraisal District.

Megan Lasch, a representative for Saigebrook, said that the developer usually does not seek tax abatements for its projects. That’s because its projects often rely on 9 percent tax credits, which provide more than twice as much private equity for the project, and its projects usually do not include a nonprofit partner, such as HACA.

Lasch explained that the project just missed the cut on 9 percent tax credits in the past two years. There is a limited supply of those credits that are awarded annually by the Texas Department of Housing and Community Affairs based on a set of criteria that changes each year.

Farida Deeds, a resident of the neighborhood, spent seven minutes providing a litany of objections to the project from neighbors, including traffic, risk of flooding, and the claim that the proposed five-story building is not “appropriately scaled” for the single-family home neighborhood.

“Four- or five-story buildings might be fine along Braker (Lane) or Lamar (Boulevard), but it is not appropriate at this site,” said Deeds.

Deeds also challenged the quality of the site for affordable housing, citing the city’s own guidelines that prioritize putting housing in “high-opportunity” areas with access to public transit.

The site indeed does not currently provide good access to transit. Lasch noted that it is a mile away from the Howard MetroRail station, but that hardly qualifies as transit-oriented. Few Austinites are willing to walk a mile to a train station, particularly in the summer months.

There are other reasons the city is inclined to favor affordable housing in the area, however. The schools that the site is zoned to – Summit Elementary School, Murchison Middle School, Anderson High School – are high-performing, and fewer than a third of the students at those schools are economically disadvantaged. Providing housing for low-income people in the area thus helps to integrate a city and school district that are starkly segregated along racial and economic lines.

Deeds also alleged that there was a sinkhole on the property, a claim that Lasch categorically denied: “There are no sinkholes on this site.”

Council is scheduled to take action on approving the bond sale on Oct. 18. As required by state law, a public hearing on the matter took place last year, but city staff later determined that it had not included all of the necessary language in the public notification about the hearing. Hence the do-over on Thursday.

“I have no question that this is a really great project,” said Council Member Greg Casar, noting how unusual it is to provide housing for those at such low income levels, particularly west of MoPac, which has very little subsidized housing.

Council Member Leslie Pool, whose district includes the property, also supports the project but thanked the opposing neighbors for their engagement on the issue and said she was sorry that the issue had dragged on as a result of the posting error.

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