"If you look no further than this most recent budget, we all know we don’t have enough funding to support a lot of critical services, homelessness included. And so we need to find other ways to pay for this," council member Ryan Alter, who first proposed the homelessness endowment, said in an interview. "By leveraging visitor taxes like we’re doing here, we are allowing for that critical work to be done without increasing our reliance on property taxpayers.”
The overview
City Council voted to create the House Our People Endowment, or HOPE, fund back in 2023. Alter presented the concept as a dedicated funding source for homelessness programs that could expand, and take outside investments, over time.
The HOPE fund had yet to receive financing until a Dec. 11 council vote to transfer $942,845 in revenue from Austin's new Tourism Public Improvement District, or TPID. The district was set up late last year to support tourism activity and hospitality bookings amid the convention center's multiyear closure, and related impacts to major events in town.
The city's overall fiscal year 2025-26 budget already includes millions of dollars for various homelessness initiatives. From the December transfer, $500,000 will be used for homeless navigation services with the remainder yet to be allocated. Housing and shelter programs could also be supported by HOPE funding that's expected to grow to several million dollars annually in the future, Alter said.
"It was always envisioned as part of this [TPID] agreement that some of the money would be used for this purpose. And quite frankly, having fewer people on the streets improves tourism," he said of the HOPE transfer. "When people come to Austin and walk around, they want to feel safe and feel like they’re in a vibrant city. And if you have a large homeless population, people don’t feel that way.”
Zooming in
Under the TPID, a share of room rental revenues is pulled from its dozens of participating city hotels for the initiative's marketing and incentive purposes. The Austin TPID generated nearly $8 million in less than a year and is projected to add about $20 million more over the full FY 2025-26 ending in September.
Visit Austin President and CEO Tom Noonan said the public improvement district is proving to be a "vital mechanism" for maintaining and growing Austin's tourism sector, given the challenge of the convention center closure and other economic pressures.
"Despite these headwinds, the TPID's strategic investments are successfully driving demand and securing critical group business that is essential to offsetting the room nights lost from the convention center closure as much as possible," he said in a statement. "Furthermore, the Austin TPID is proactively securing future business for the new, expanded Austin Convention Center, which is foundational to driving long-term economic success and growth for Austin's tourism industry and the broader community."
Most TPID promotion activity has taken place since October, according to Visit Austin, when the first district funding became available. That's included incentives for almost 40 definite or proposed events totaling more than 150,000 room nights to be held in "campus-style" formats across different venues while the convention center is unavailable.
Nearly 940,000 room night stays from dozens of confirmed or tentative group bookings have also already been lined up for the first decade after the convention center's planned reopening in 2029. Those are expected to bring an economic impact of almost $700 million, according to Visit Austin, and roughly 40% wouldn't have fit in the old convention center.
Other TPID-supported promotion has included:
- A tourism marketing study completed earlier this year and the Meet More Austin meetings campaign launched this fall
- An incentive program for TPID hotels to secure competitive group booking that's already received hundreds of applications totaling more than $80 million in potential city room revenue; 131 confirmed bookings total more than $21 million in room revenue
- The Expedia Neighborhood Campaign—the first TPID-supported campaign in Texas for hotels with smaller meeting space, according to Visit Austin—that's generated millions in hotel revenues and tens of thousands of room nights since late November
"If people want us to be able to do things without always going to property taxpayers to fund them, then these are the kind of things that we need to be doing," he said. "We need to have other people fund our operations, and visitor taxes are a great way to do that. And you can’t do that if you don’t have visitors."
