Focused on real affordability, City Council moves to improve density bonus programs

City Council voted Thursday to initiate a review and potential overhaul of the city’s density bonus programs, signaling a shift toward more flexible and customized incentives to promote affordable housing and community benefits across different parts of the city.

The resolution was supported by all of City Council but Council Member Krista Laine, who abstained. It directs city staff to develop new types of density bonus combining districts in the Land Development Code. The proposed changes could introduce districts with varying height entitlements, tailored affordability standards, and a broader menu of community benefits such as ground floor activation, civic space, and design upgrades.

Mayor Pro Tem Vanessa Fuentes, who introduced an amended motion adopted as part of the final resolution, added language aimed at ensuring one-to-one replacement of demolished units is considered as part of future redevelopment requirements. Equalizing the replacement of naturally occurring affordable units in redevelopment projects was one of the biggest concerns of the dozens of public comments about displacement risks prior to the vote.

The resolution also calls for staff to recalibrate existing programs, including DB90 and Vertical Mixed Use (VMU) zoning, to align with the new framework. It calls for the creation of a “hierarchy” of bonus districts, an approach that could allow for differentiated standards across neighborhoods rather than a one-size-fits-all model.

The resolution didn’t set a specific deadline for when staff must return with proposed amendments, but it directs the city manager to prioritize the development of new density bonus districts and related code changes in coordination with the ongoing Equitable Transit-Oriented Development (ETOD) and Density Bonus Equitable Transit-Oriented Development (DBETOD) initiatives. Staff are expected to incorporate findings from January’s Comprehensive Analysis of Density Bonus Programs and deliver draft proposals for Council consideration “in a timely manner,” though the timeline for public engagement or formal adoption has not been outlined.

Council Members spent little time discussing the resolution, other than brief indications of support and the need to make changes that preserve affordability in new development projects. Explaining her decision to abstain, Laine said, “Although I arrived today planning to vote in support of this, having listened and thought about the commentary that I’ve seen today and how it relates to what I’ve seen play out across the parts of the city that I know best, I would like to be noted as abstaining from item 80.”

In a Council message board post accompanying her motion sheet, Fuentes said the density programs were leaving too many opportunities for developers to receive excess height to add profitable units without preserving or adding to the number of affordable units.

“It’s essential that we strengthen the effectiveness of these programs so they better serve our low- and moderate-income residents,” she wrote. “As we consider updates, my priority is ensuring that multifamily redevelopment requirements and tenant protections — particularly the one-to-one unit replacement outlined in City Code Chapter 4-18 — remain central. We’ve seen in past redevelopment cases how critical unit replacement is to allowing long-term residents to remain in their communities.”

In a separate message board post, Councilmember Marc Duchen said he plans to bring forward a resolution calling for the creation of a fund to preserve naturally occurring affordable housing. That initiative is similar to a program in Dallas, which Duchen has referenced in his own calls to improve the city’s density bonus options.

“A housing opportunity fund would give Austin an additional and significant tool to help to address displacement of essential workers, teachers, nurses, veterans, and many others who might otherwise be forced by market-rate redevelopment to leave their homes,” he wrote in part. “Notably, Austin already has the financial resources for this, in unexpended 2022 Affordable Housing Bond dollars and the Project Connect Anti-Displacement fund.”

Photo by Larry D. Moore, CC BY 4.0, Link.

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