Current situation
A memo from the city manager to council members dated Dec. 5 outlined the new timeline for a funding commitment, further indicating that staff would be withdrawing agenda Item 49, related to cap and stitch design funding, and Item 50, related to commitment to fund roadway elements for caps, from the Dec. 12 council meeting with the intent to bring these items back to a March council meeting.
After an update from staff Nov. 19 revealed that costs for the full build of the project had ballooned to an estimated $1.4 billion, council members heard staff recommendations to scale the project back.
“I feel like we’re being penny-wise and pound-foolish on 800-foot [reduced] caps,” Austin City Council member Chito Vela said.
Per council members’ request, staff is expected to independently review and verify TxDOT’s over 30% increase in cost estimates over the coming weeks.
The recent memo also brings forward new information surrounding a number of build options and the associated cost estimates, as well as the likely property tax increases residents might see should council members move forward with plans to build these amenity decks covering the interstate.
Staff detailed the impact to constituents of the most recently included scenario, which costs just over $1 billion and includes three full-sized downtown caps and two full-sized northern caps while eliminating the Holly Street stitch, the stitch south of Cesar Chavez and the cap north of the Red Line.
For every $100 million of bonds issued, the debt service tax bill increases for the typical homeowner by $13.78 annually, according to the memo.
Should council members select the newest proposed scenario, homeowners—based on the median-valued homestead within the city of Austin—would see an estimated $137.86 added to their tax bills annually, according to city documents.
It is noted that future bonds would be issued over a 10- to 15-year period, meaning that the projected monetary impact to taxpayers will likewise be over an extended period, not all at once.
Council member Paige Ellis previously expressed concerns that issuing such large bonds could limit the city's ability to fund future needs, including essential city services.
Though the city may experience an overall weakening in financial rating metrics, staff found the city’s credit rating “will remain favorable.”
One more thing
City officials also requested clarification on the potential impact to the proposed East Avenue Trail if the project is downsized.
The trail was originally a “betterment” of TxDOT’s current plans for a 19-mile trail along the interstate, which would connect to the Ann and Roy Butler Hike-and-Bike Trail in downtown Austin.
If council opts to reduce or remove caps along the corridor, it could limit plans to widen the East Avenue Trail in areas where TxDOT’s right-of-way is too narrow for the desired 24-foot pathway with shade trees. The caps provide extra space to make this expansion possible.
City staff will work with TxDOT in early 2025 to explore where the trail can be widened beyond the standard 8- to 10-foot width. If caps are built, designs will include space for the wider trail in tight areas.
Funding for the trail improvements is expected to come from existing city funds, like previous sidewalk and trail bonds, and is separate from the cap and stitch funding currently under discussion.
Looking ahead
Though the decision regarding the complete design and funding of public green space connections over I-35 has been delayed until the spring, council members will consider approval for a State Infrastructure Loan of up to $41 million to be used toward future cap and stitch endeavors during a meeting Dec. 12.
Officials will also call up an agenda item detailing a $105.2 million grant from the U.S. Department of Transportation, which includes a $45 million local match, to be used specifically for the proposed 5.37 acre-cap spanning Cesar Chavez to Fourth Street.
A design initiative for the Cesar Chavez-Fourth Street cap will be kicking off in the coming months, City Transportation Officer Michelle Marx said.
The city is required to construct at least the original three-block cap structure outlined in its application and acceptance of the US DOT grant funding, according to a response from the Federal Highway Administration.
The total cost for this downtown deck is estimated to range from $168 million to $225 million.
Also of note
The University of Texas Board of Regents is also slated to approve a $106 million contract with TxDOT on Dec. 11 in order for the agency to begin working on the design of caps located near the university, a separate project from the city's.
Should board members approve the December agreement, this contract will add to the $13.5 million downpayment the university already paid to TxDOT in May, securing the design of roughly 17 acres over the interstate between 15th Street and Dean Keeton Street—which have reportedly been very complex, according to Heather Ashley-Nguyen, a transportation planner with TxDOT.
