Several of Austin's newest affordable housing development programs may soon be voided through a pending decision from a Travis County judge, following residents' legal action over how the city carried out the changes.

The background

Earlier this year, Austinites who successfully sued the city over a proposed rewrite of the land development code—the intricate rules outlining how construction can take place across town—filed another challenge to several City Council-approved affordable development programs. Those included:
  • Affordability Unlocked, a widely used bonus program allowing larger buildings if those projects feature a portion of income-restricted housing
  • VMU2, an update to Austin's vertical mixed-use bonus program trading greater building height for a portion of affordable units in a development
  • "Compatibility on corridors,” which removed local limits on building features such as height for new housing projects along Austin's major transit routes
  • "Residential in commercial,” which allows housing with affordable units to be built in commercial areas
The plaintiffs claimed that, in enacting those new policies between 2019 and 2022, city officials ignored state law requiring that residents be clearly notified about local zoning changes and have the opportunity to protest such updates.

District and appeals courts had determined the city violated Texas notice and protest rights in the previous land development code update. Plaintiffs in this year's follow-up said Austin "simply disregarded" that outcome and called for all four of the development programs to be canceled out due to the city's alleged process missteps.

Resident and city lawyers met Sept. 26 to argue both sides of the issue.

What's happening

Staff with 200th District Court Judge Jessica Mangrum stated Nov. 8 that she intends to rule in line with the resident plaintiffs' request regarding three of the four programs in question—VMU2, compatibility on corridors, and residential in commercial—approved by council last year.

City lawyers previously argued that any objection to Affordability Unlocked, established back in 2019, came too late given its passage months before the initial lawsuit was filed.

Doug Becker, the attorney representing the resident plaintiffs, said that group now hopes to see the three ordinances voided, in addition to finalizing potential sanctions against the city and recollecting their attorneys' fees.

“We hope, going forward, that the city learns from this experience and will finally do the right thing and respect the interests and legal rights of Austin homeowners," Becker said in a statement.

For now, Austin is reviewing next steps based on the legal decision.

“We appreciate the court’s time and attention to this issue. The court made a preliminary ruling in the plaintiffs’ favor related to three of the ordinances (VMU2, Residential in Commercial, and Compatibility on Corridors). The parties are working to seek clarity on what process changes will be needed in the future," a city spokesperson said in a statement.

What's next

The final outcome of the proceedings is still to be determined pending a ruling from the 200th District Court and a final hearing over the financials in the case.

Fred Lewis, an attorney and one of the resident plaintiffs, said the city's apparent losses in the two high-profile land development code cases also ties into Austin's handling resident opposition to another zoning policy update that's now under consideration at City Hall.

"After badly losing two costly lawsuits it claimed were frivolous, the city now illegally refuses to recognize electronic filing of protest rights against their amendments to eliminate single-family zoning," he said in a statement. "The city needs to stop violating the law and suppressing public participation and begin to have real stakeholder deliberations to reach a consensus code. The rule of law and public participation deserve more than lip service.”