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Thousands of potential units in projects certified so far under Affordability Unlocked program

Wednesday, September 9, 2020 by Daniel Salazar

A city bonus program to spur more affordable housing has already played a role in several income-restricted projects across Austin.

Neighborhood Housing and Community Development Department staff and affordable housing developers provided an update on the Affordability Unlocked program to City Council’s Housing and Planning Committee on Tuesday morning.

Affordability Unlocked offers waivers or easements on height, density, parking, compatibility and other development regulations in exchange for high percentages of affordable units.

“It was meant to enable housing providers to build more units in their developments … and to better leverage public funds, in particular in light of the 2018 affordable housing bond,” said Alex Radtke with NHCD.

Council approved the Affordability Unlocked ordinance in May 2019 and the application portal went online last November.

After an application process, project owners or developers can execute an agreement with NHCD to participate in the program. Staffers issue a certification letter, which accompanies a project as it moves through the development review process.

As of Sept. 3, 26 applications have been certified out of 46 total applications. Most of the certified projects – 69 percent – are rental developments. Radtke said the department has certified a total of 2,721 units in projects under the program, of which 2,337 are affordable units.

Building permits have been issued or are under review for three projects: A Civilitude project at 12500 Lamppost Lane, a Guadalupe Neighborhood Development Corp. project at 1103 Clermont Ave. and a JESE Real Estate project at 300 E. Croslin St.

Three other developments have a site plan under review: Agave East Apartments by Herman & Kittle Properties and the Matador and the Henderson, both by LDG Development.

Rachel Stone, the assistant director with the Guadalupe Neighborhood Development Corp., said a senior housing development at 809 E. Ninth St. can go from 24 units to 34 units through the program, with six deeply affordable units.

“It was a very tough project before and we’re able to serve significantly more seniors at this site, so that’s been really helpful,” Stone said.

The Lamppost Lane project, which features 17 multi-bedroom townhome-style units available to households at 80 percent of the median family income or below, was the first to break ground in July. Civilitude’s Fayez Kazi said waivers on parking and setback requirements allowed the project to go up from its initial unit count of seven.

Southeast Austin’s District 3 had the most certified projects with six. East Austin’s District 1 and North Central Austin’s District 4 both had five certified projects.

Districts 6 and 8 in Northwest and Southwest Austin have no certified projects yet.

“I look forward to seeing where people are able to expand this in the future,” said Council Member Paige Ellis, representing District 8.

Tweaks to the program are a possibility. Council Member Alison Alter said the city could find itself “potentially stuck” if a developer pursues an upzoning and doesn’t follow through with pledges to participate in Affordability Unlocked.

“It’s problematic if we’re giving zoning based on an expectation of additional affordable housing but then there’s no mechanism to ensure that that happens,” she said.

Council Member Greg Casar, who championed Affordability Unlocked early last year, said they should work to improve the program so zoning changes aren’t necessary for developers.

“Generally, there’s not as many zoning changes, which is partly the point,” Casar said. “If somebody is already going to participate in that level of affordability, they don’t have to go through the rezoning process.”

Applicants to the program can choose between two categories. In Type 1 rental properties, the average affordable unit must serve residents at or below 60 percent median family income for 40 years. In addition, 20 percent of all units must serve households at 50 percent MFI or below.

For Type 1 ownership projects, affordable units must serve households making 80 percent MFI or less for 99 years.

Type 2 projects are developments that meet all Type 1 requirements around income, unit size and tenant protections and are able to meet one of four additional provisions. Properties can qualify as Type 2 if 75 percent of units are affordable, 10 percent of affordable units are “deeply affordable” at 30 percent MFI and they’re within a quarter-mile of an Imagine Austin corridor with transit or 50 percent of affordable units have two or more bedrooms.

Through Affordability Unlocked, Type 1 projects can increase their height by 25 percent above their base zoning district, while Type 2 projects can go up to 50 percent above their base zone’s height limit.

Ten of the 26 certified applications are for Type 1 projects, while the remainder are Type 2.

This story has been changed since publication to correct a typo. Photo made available through a Creative Commons license.

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