Rainey Street fund rises from ashes to preserve Mexican-American heritage in booming district

Although the city has long intended to preserve the Mexican-American identity of the rapidly changing Rainey Street District, it has never prioritized the money to do so—even though City Council has tried. That changed Nov. 14 after City Council unanimously supported the creation of a new financing funnel.

The Rainey Street Fund will collect right of way fees, alley vacation sales and license agreement payments from development projects in the Rainey Street District to pay for projects that promote and preserve the heritage of the once-modest Mexican-American neighborhood.

The Rainey Street District, located in downtown’s southeast corner, has seen explosive growth since 2005, when City Council approved a dramatic increase in allowed density for the area. The neighborhood—an area of roughly one-tenth of a square mile—which was once characterized by single-family bungalows is now home to 3,565 residential and hotel units with more than 3,600 more units approved or proposed, according to a Community Impact Newspaper analysis.

The Rainey Street Fund will collect revenue through development projects in the neighborhood. Amid some council concerns that the fund was taking the lion's share revenue that could be used across the city, City Council agreed to cap the fund’s collection at $200,000 per year.

City Council attempted to create an annually funded Rainey Street Fund back in 2013, but miscommunication of intent between city staff and City Council members left the fund void after one year. Council Member Kathie Tovo, whose district includes Rainey Street, has led the effort to revive the fund as concerns mounted over waning Mexican-American presence and growing infrastructure issues in the booming neighborhood.

“This was a commitment that was made that’s never been fully realized,” Tovo said. “I’m trying to pull from the ashes something we can all support and honor what I regard as a significant commitment that the city has not upheld.”

When Tovo initially brought this proposal back in August, she wanted the fund to pay for infrastructure projects in the neighborhood as well, but she received pushback from other council members, who said that the entire city should compete fairly for sidewalk and capital improvement money and that neighborhoods should be prioritized by need. However, many council members supported the creation of a fund aimed at promoting the Mexican-American heritage of the neighborhood.

In voicing support for the fund, Mayor Pro Tem Delia Garza criticized Austin for not elevating Mexican-American culture at the same levels as San Antonio.

“I hope that this fund can create a similar sense of belonging and sense of culture for our Latinx community here in Austin,” Garza said.