In the midst of a development boom and growing affordability crisis, producing the highest number of affordable housing units has been the central policy goal of Austin City Council as it works to rewrite its land development code—the rules governing what can be built in the city and where—a project that began around 2012.
When staff provided the mayor and City Council with a progress report Sept. 11, the conversation resurfaced disagreements between the elected officials over how to achieve those affordable units.
Tools available to a city for producing affordable housing in Texas are essentially limited to two options, said Erica Leak, the manager of housing policy and planning for Austin. A city can provide subsidies to make market-priced units affordable for a lower-income bracket, or the city can offer incentive programs that trade entitlements, such as additional height, for community benefits, such as income-restricted housing units. In Austin, the incentive program is called density bonus.
Various changes are excepted to come with the new code, including a rezoning of neighborhood areas around corridors and activity centers that would allow for some increased density, known as transition zones. However, city staff said most of the city’s increased housing capacity would come along the corridors—roadways such as Guadalupe Street and Lamar Boulevard. The plan is to carry forward existing zoning for lots along the corridors and adjust many of existing code contradictions that keep the lots from being able to build out to what their zoning allows—and avail them to the density bonus program.
District 10 Council Member Alison Alter, who has often sounded the alarm on giving away entitlements to developers, expressed strong doubt that staff’s plan would yield more units. The issue, she said, is in the calibration between zoning entitlements and density bonus offerings: The extra entitlements obtained by building affordable housing have to be attractive enough so developers actually go for it. If a developer wants to build an additional two stories, but the city’s formula requires too many affordable units in exchange, fewer developers may go for it, leading to fewer affordable units. If it requires too few affordable units, many developers might take advantage, but the city would receive fewer affordable units than it might get with a more balanced equation.
Alter said easing constraints and allowing lots along the corridor to now develop to what their existing zoning allows would be equivalent to granting developers and property owners additional entitlements without receiving affordable units in exchange.
“I understand that for some versions of this that is what people want … [but]it is giving [developers]entitlements without a bonus, and we should be calling it what it is,” Alter said. “If [base entitlements]can be set as low as possible, then that is when you have the greatest potential for more affordable units. You have increased the base even before you give them the opportunity to go for the bonus.”
Peter Park, a consultant working with city staff on the rewrite, agreed with Alter’s assertion but said staff was not given direction to decrease zoning entitlements on any lot, let alone along the corridors.
Mayor Steve Adler said if the city has mapped a zone in which properties are supposed to be allowed to be built to a certain height, but contradictions in the code keep a property from building to that height, he would say “there is a problem” with the code that needs to be fixed.
“The calibration is so important because I don’t think it’s always true that maintaining entitlements at their current state and just adding a bonus means that you’re going to get the bonus,” District 6 Council Member Jimmy Flannigan said. “It could equally be true that an increase in base entitlements is what makes the rest of the bonus work financially.”
District 4 Council Member Greg Casar said the nitty gritty of the calibrations could be figured out and tweaked to perfection later, and he wanted city staff to simply prioritize getting a new code that allows for more affordable and market-rate housing across the finish line.
“I’m ready to go to work to make sure that the base and the bonus are calibrated so that we can get 10 times, 11 times more affordable housing in those bonuses than we get right now,” Casar said. “But at some point, we have to change from the status quo to make it better … even if it isn’t totally perfect in every single place. But the idea that these changes are going to get us less affordable housing just can’t be right because you can’t get any less than what we’ve got right now.”