City Council wrapped up a two-day meeting Dec. 2 with key votes on new city development rules, putting a cap on a yearlong effort to pass agreed-upon housing policy updates before several officials leave office.

A push to completely revamp the city's intricate and decades-old land development code, governing how and where building takes place in Austin, has extended through the terms of current council members—and ended without any broad changes in place after a resident lawsuit successfully halted the city's process. Late last year when that legal outcome was still in question, city leaders announced a renewed attempt to tackle Austin's housing crisis and rising cost of living by considering only more specific ideas that could pass through City Hall with consensus support.

On Dec. 2, officials approved two of those items geared toward expanding housing options across Austin's transportation corridors and in areas where the city hopes to encourage more residential construction. One unlocks commercially zoned areas for housing development, a practice generally restricted in the code, while the other cuts down on some development limits along transit networks.

Mayor Pro Tem Alison Alter said the changes—while not perfect—represented progress built on compromise between several council members and constituents.

"I believe the mayor and I have demonstrated that a broad and diverse caucus representing multiple corners of the city can work together to achieve results," Alter said. "It may not be what any one of us would have crafted on our own, but rather than lamenting that whether this proposal is only half a loaf, we should remember that half a loaf is still a lot of bread. And we can always continue to work to make our city more livable and more affordable.”

Compatibility, commercial updates

The first update approved by council allows residences on properties now zoned under a commercial category. The change applies to thousands of parcels, including a majority near both existing transit and future Project Connect routes.

The affordable incentive program requires that anyone interested in bringing housing to land that is now reserved for offices, shops or other commercial uses must include a portion of income-restricted housing. Ten percent of units in a participating rental development must be available at 60% of the median family income, or MFI, while the same amount of spaces in an ownership project must be available at 80% MFI or below. The Austin metropolitan area's MFI is $110,300 for a family of four.

Council also addressed a limit on new construction that officials and developers have long pointed to as one of the more significant constraints on housing locally. Austin's compatibility standards, or rules designed to keep development in line with existing homes and neighborhoods, are believed to be among the strictest in Texas and comparable cities nationwide.

The December code update reduces certain compatibility effects, such as a cap on building height, along corridors where council generally agreed larger development should be placed. New construction with more affordable housing will see even greater compatibility reductions allowing for taller and denser buildings closer to existing residences.

Corridors include stretches of Congress Avenue, Braker Lane, Lamar Boulevard, Slaughter Lane and dozens more roadways as well as major highways.

The concepts ended up earning majority support on the council dais, with some reservations. Community feedback was generally split between more pro-housing voices encouraged by the potential for new development and those concerned the changes could infringe on existing properties and further contribute to displacement, especially in gentrification-prone areas, such as East Austin.

While council passed the code updates in supermajority votes, some residents opposed to the changes may again challenge the city's land-use action in court. Community Not Commodity, which advocates for homeowner and neighborhood perspectives in housing debates, said it is "seriously considering" legal action over the city's handling of the December votes and related public hearings.

"Council chose to rush to approve in a lame duck period two unvetted land-use ordinances that will greatly undermine the current communities in neighborhoods. The burden will fall on current Austin residents, but the gain will go to real estate speculators and investors. Little to no 'affordable' housing will be built for middle-class and working families, and these amendments will result in even more displacement of nonaffluent Austinites," the group said in a statement.

Equity in focus

The residential in commercial code update opens new housing possibilities on almost 3,000 properties in "high-opportunity" areas, or places where residents have better socioeconomic outcomes and chances at upward mobility. In Austin, those areas are generally concentrated on the west side where affordable housing is largely absent.

The change also applies to more than 4,200 properties in places the city has found to be more prone to displacement, largely on the east side.

The proposal was recommended by city staff, with positive reviews of its affordability effects raised alongside concerns about future negative effects for residents who may be bunched around highways, where health outcomes can be worse.

"Given the city of Austin’s history of implementing racist policy with respect to industrial zoning and communities of color, special care must be taken to engage with communities who the city has harmed in the past, so that harm is not repeated," staff wrote in their analysis.

Conversely, the compatibility measure was not recommended by staff in its current form. Their report on the program raised issues with an additional layer of code complexity and questioned whether it will effectively bring more housing for low- and middle-income Austinites to market. Erica Leak, a representative of the city's housing department, also told council Dec. 2 that the corridor policy is not designed to be equitable across town.

Aside from highways such as MoPac and FM 620, almost none of the heavily trafficked corridors featuring reduced compatibility limits are located in West Austin. The policy's disparity between the more affluent west side and Central and East Austin, which have seen more rapid redevelopment and displacement in recent years, led District 1 Council Member Natasha Harper-Madison to cast her vote in favor "very hesitantly." She also shared commentary on the city's continued east-west split in housing production and affordability, and asked officials to better prioritize the concept of equity in future housing policy debates.

“This item as it is currently designed is designed as inequitable. The exclusion of corridors in high-income areas was purposeful and by council direction, and we are left with no option to address these inequities today," Harper-Madison said. "The fact that a well-intentioned and necessary reform to our really desperately outdated land development code has been warped to once again exclude West Austin and other high-income areas from this much-needed housing conversation is sadly not at all surprising.”

Other council members echoed her view that the city was putting a less equitable policy into place, and she and District 4 Council Member Chito Vela both said they plan to review how relevant policies could become more balanced citywide next year.

Alter, who represents West Austin's District 10 and helped draft the list of corridors this spring, said she hopes to work on ways to increase affordable housing on her side of town alongside other officials. Alter also said council's action on housing in commercial areas could end up being the more effective policy, and that compatibility tweaks may not be the best way to make a dent in the west side market.

"Every tool that we use is not going to solve all of the problems at once, which is why we have to look at all of the different tools. And I think that we have made a lot of progress on a lot of different fronts, and so I’m glad that we’re able to conclude this council with passing these two items," she said.

Locating the 'missing middle'

On top of those two final votes, council also kicked off consideration of a new development process to ease more "missing middle" housing into Austin.

A proposal from District 8 Council Member Paige Ellis requests city management to waive often expensive and time-consuming development planning requirements for three- and four-unit projects, moving them in line with single-family and two-unit homes. Ellis' resolution also calls for the creation of a "site plan lite" for five- to 16-unit complexes aimed at speeding up their production. Both items could now move forward as soon as next spring.

“We’ve got units that are getting stuck in the permitting process that’s designed for much larger projects," Ellis said. "When you have missing middle housing as small as five units having to undergo a very, very lengthy process and costly process, that’s why we’re not seeing housing coming onto the market. People can’t live in the pipeline, and so we need to make sure that these units are coming online, that people are able to buy homes, that people are able to have units to rent."