The board of trustees discussed forming a public facility corporation to offer rent- and income-restricted housing to district staff at an April 17 meeting.
“This is an expensive place to live,” LTISD General Counsel Allyson Collins said. “We have some staff that's able to live here but a lot of staff that drives in and commutes, and we know that’s a factor in staff retention and recruitment.”
The overview
By establishing a public facility corporation, or PFC, LTISD could own and lease a property to a developer who would run the day-to-day operations of an affordable, multifamily housing development.
The district’s PFC would provide a 100% property and sales tax exemption to the developer under the condition that over 60% of units were reserved for residents making under 80% of the area median income, or AMI, Shackelford Law representative Kara Hargrove said.
About 40% of units would be for those making less than 80% of the AMI, while 25% of units would be reserved for residents at 60% of the AMI, Hargrove said. Rent for the units could not exceed 30% of those AMI levels, she said.
The median family income, also known as AMI, for the Austin and Round Rock area is $126,000 in 2024, according to the U.S. Department of Housing and Urban Development.
The district could reserve a certain number of units for staff members and negotiate making the units even more affordable if desired, Hargrove said. District officials also discussed opening some units to first responders, and Baylor Scott and White employees in the area.
What else?
The PFC would be governed by the board of trustees, who would need to adopt a resolution to create the nonprofit corporation and hold regular meetings once formed.
The district would take on no liabilities or debts under the PFC but could receive revenue through various fees, annual ground lease rent payments, and a portion of sales tax savings for new construction, Collins and Hargrove said. LTISD could also be paid if the property was sold or refinanced.
Assistant Superintendent for Business Services Pam Sanchez said she would speak with the district’s auditor to determine how those funds could be used.
Some districts, such as Austin ISD, have recently begun exploring the state law allowing governmental entities such as school districts to create PFCs, Collins said.
“It’s a very new development for school districts, but it’s gaining traction for sure,” Collins said.
What they’re saying
Several board members spoke in support of forming a PFC to improve retention and recruitment as some staff members have struggled to afford living in the area. The district had over 120 vacant positions as of February, according to LTISD data.
“Knowing that other districts are already doing this, and we’re already having a challenge getting people to come out to Lake Travis and live in this area, I feel like we need to stay ahead of this to really be competitive for our staff and fill positions,” Place 2 board member Lauren White said.
Place 1 board member Phillip Davis said he understood the benefits to the district but questioned why a developer would be interested.
“This tax exemption is huge,” Hargrove said. “All types of affordable deals they just can’t make at this point without this exemption."
Stay tuned
The district will survey staff members to see if they would be interested in workforce housing, Superintendent Paul Norton said.
Collins recommended the board vote on whether to form a PFC at its next meeting May 15 so the district can move forward.
