City officials, candidates, and representatives of several community organizations gathered July 21 at The Jordan at Mueller to rally in support of the bond's placement on the November ballot. Speakers, including a resident of The Jordan—a 132-unit affordable apartment complex built by nonprofit Foundation Communities using 2013 housing bond funds—all said an infusion of hundreds of millions of dollars for affordable housing is needed to mitigate the city's housing crisis and displacement trends.
Officials commented on the bond's potential to help bring new housing near the city's growing transit network and to help keep residents from getting priced out of town. After hundreds of new affordable housing units were developed using funds from previous housing packages, Mayor Steve Adler said he felt a responsibility to act on various groups' call for a new bond election this year.
"Frankly, we have run out of money, and this is absolutely the wrong time to stop. We have momentum, we have direction, and the need continues to increase," he said. "This is a city that is building more housing than any city in the country right now, and it is not enough."
In addition to Foundation Communities, the more than two dozen organizations now backing the bond include the housing research and advocacy nonprofit HousingWorks Austin, the Austin Justice Coalition, Austin Habitat for Humanity, Family Eldercare, the SAFE Alliance, Notley, The Other Ones Foundation, Equidad ATX, and other development and community groups.
Through prepared remarks read at the event by District 4 Council Member Chito Vela, District 1 Council Member Natasha Harper-Madison said the bond's passage would build on the city's public housing investments and safety net for marginalized residents. She also called for broader action at City Hall aimed at revisions to the city's land development code.
"Even much greater than a few hundred million dollars, we need to use every tool at our disposal, and that includes rewriting our outdated rules and regulations that have created and continue to reinforce racial and economic segregation. Our city is sick with an affordability crisis, and the three best treatments are housing, housing and more housing," Harper-Madison said.
City Council is set to take an initial vote on whether to place the bond on the ballot July 28.
Housing, economic effects
A $300 million proposition would represent a package 20% larger than the $250 million affordable housing bond approved by voters in 2018. That measure followed 2006's $55 million housing bond and a $65 million package approved in 2013.
According to HousingWorks Austin, 2006 bond funds were used to produce 34 housing developments; 2013 bond funds supported 20 developments; and 24 projects have been funded through the 2018 bond. Altogether those developments include more than 6,700 housing units, most of which are available at affordable levels based on income.
As past bond dollars continue to be spent, a new analysis of the output of those packages found they produced hundreds of millions in local economic effects in addition to thousands of residences. The report came from HousingWorks and consultant Civic Economics, and follows similar research based around the earlier bonds.
According to the groups' new look into activity from 2016-21, work including construction and maintenance or rehabilitation of projects funded by the 2013 and 2018 bonds generated more than $1 billion in the Austin-area economy while directly supporting more than 5,100 jobs.
Tax rate increase
While the final scope of a potential bond has not yet been finalized, city financial staff have released an initial estimate of what a $300 million bond could cost Austin homeowners if approved.
In a July 21 memo, Deputy CFO Kim Olivares said the proposition would tack $0.0112 onto the city's property tax rate for debt service in fiscal year 2022-23, assuming all $300 million is sold at once. Based on that increase, Olivares said the "typical" homeowner—defined as someone with a home valued at $448,000 and using local homestead exemptions—could expect an annual tax bill increase of just over $40. Projections for tax effects in future years are not yet available.
"This approach is in line with how we will have to provide this information in accordance with Texas election laws, assuming council votes to include it on the ballot. Estimating the impact on the debt tax rate for FY24 and beyond would require further analysis," Olivares said in an email.
That preliminary figure would increase the FY 2022-23 debt rate portion of taxpayers' bills to $0.1061 per $100 valuation, 11.8% more than the $0.0949 debt rate proposed by City Manager Spencer Cronk this month.
Austin's overall property tax rate, including both operational and debt portions, would increase 2.48% from Cronk's proposed $0.4519 to $0.4631 per $100 valuation.
Austin voters passed the 2018 proposition with nearly 73% support after the 2006 and 2013 measures were approved by more than 60% of voters. Polling conducted this June by JTX Strategies, Inc., a firm commissioned by HousingWorks Austin to gauge community interest in a new bond, found that affordable housing packages of various sizes could likely pass in this November's election. The polling was paid for by multiple housing organizations and advocates, HousingWorks said.
Through a poll of 500 voters citywide, JTX presented both favorable and unfavorable messaging about a bond before posing hypothetical packages of $85 million and $250 million. The firm found relatively equal support—60% and 59%, respectively—for such propositions.
JTX also found that most Austin voters want the city government to take more action on housing affordability, with 83% of respondents agreeing with that sentiment. Broad majorities are also worried about their property taxes—83% were "somewhat" or "very" concerned—while more than 90% of those polled expressed concern about inflation. However, just over one-third of those polled said today's housing market is a direct result of City Council action.
Some opposition to the housing package is also growing in addition to the multiple groups in support. Save Austin Now, the political action committee behind both the successful ballot measure to criminalize public camping and last year's failed police staffing mandate, followed the July 21 bond rally by pushing against the proposal and potential tax rate increase.
"Improving affordability will happen when Austin cuts development fees and streamlines permitting to allow developers to buy affordable homes more quickly at a lower cost. City Hall has directly contributed to the affordability crisis in our city. Adding another $300 million to our debt will make affordability worse, not better," SAN co-founders Matt Mackowiak and Cleo Petricek said in a statement.