Economic development incentive amendments OK'd by Austin City Council

After more than two hours of public speakers on the subject, Austin City Council revamped future economic development incentive agreements at its Oct. 24 meeting by establishing eligibility standards for applicants to fulfill so they can take part in the program.

The topic was a contentious issue, with more than 250 people signed up in favor of it, though very few were signed up to speak against it. In particular, speakers focused on the requirement of a prevailing and living wage in order for a business to be eligible for an incentive agreement.

"This is not about trying to stop, stifle or hurt job growth or the economy," said Councilman Mike Martinez, who sponsored the resolution. "In fact, it's the exact opposite. It's about creating the jobs we need in Austin with the companies that we need here in Austin, who understand the values we are trying to impart in this policy."

The resolution created a matrix for staff and council to use to approve incentive deals. Part of that matrix criteria includes requirements for an applicant to provide a prevailing wage for construction workers. For prevailing wages that fall below the city's living wage, companies applying for an economic development incentive must provide a living wage for construction workers. The resolution also requires the applicant to provide at least a living wage for full-time employees and contract employees.

The city's living wage is about $11 an hour, and the city uses Travis County's prevailing wage determination. A prevailing wage is the hourly wage, benefits and overtime for a job type in a geographical area.

David Ford, president and CEO of the Central Texas Chapter of Associated Builders and Contractors Inc., said his organization's concern was that requiring both a prevailing wage and living wage would drive potential businesses away from the city.

"When companies are considering coming to Austin and they see this increase in construction cost, they may consider going elsewhere," Ford said. "We need construction in Austin. Nobody wins when companies go elsewhere. You're going to hinder the [Greater Austin Chamber of Commerce's] ability to bring companies to Austin."

Austin resident David Butts also spoke at the meeting. He said he could not believe that the living and prevailing wage issues were even up for debate and that the city should get something in return for the incentives.

"Quite honestly, if [companies] want to come here on their own and do whatever they do, then that's their choice," Butts said. "Now if they want tax dollars for benefits from the city, that's a different matter."

Several members of the council were concerned over the potential increased cost to development if the prevailing wage aspect remained a requirement as well as the potential job loss.

"If it does kill any jobs, here are the jobs that [the resolution] is going to kill," Martinez said. "It's going to kill jobs that pay a poverty wage. It's going to kill jobs that require folks to be on other government assistance, thus costing all of us."

Councilman Chris Riley amended the resolution so that the prevailing wage requirement, like the living wage requirement, could be exempted.

"I do think there might well be times that we would be in danger of losing jobs that would be valuable to this community if we maintain the rigid expectation of prevailing wage in all cases," Riley said. "What we've seen in cases like US Farathane [Corp.] is that there may well be good reasons why a firm may need to pay something less than a prevailing wage or even a living wage in some situations."

Some of the more notable businesses to receive economic incentive agreements with the city include HID Global and Apple Inc.

Councilwoman Kathie Tovo, a co-sponsor of the resolution, said that if she had been left on her own to craft the resolution, it would look different, but she was happy overall with the way the item turned out.

"I think, [overall], it is a very good balance of allowing us to have a robust policy that will attract companies to our town and still making sure that we do have a taxpayer return on investment," Tovo said.


The Centers for Disease Control and Prevention and U.S. Food and Drug Administration recommended health providers pause distribution of the Johnson & Johnson vaccine April 13. (Olivia Aldridge/Community Impact Newspaper)
State, federal health authorities recommend pause of Johnson & Johnson vaccine after 6 rare, severe blood clots

Hub providers in Dallas, Harris and Travis counties have all announced they will follow the recommendations and pause distribution of the Johnson & Johnson vaccine.

Recipients of the COVID-19 vaccine wait after receiving their shot at the Delco Activity Center in Northeast Austin on March 13. (Jack Flagler/Community Impact Newspaper)
National supply issues with Johnson & Johnson vaccine affect Austin-area shipments

After a manufacturing error ruined 15 million doses, the Centers for Disease Control and Prevention said the supply will not increase until the plant in Baltimore is once again allowed to participate in production.

Romeo's Pizza held its Georgetown groundbreaking April 6. (Courtesy Romeo's Pizza)
Romeo's Pizza coming to Georgetown; Vacancy Brewing opens in South Austin and more Central Texas news

Read the latest business and community news from the Central Texas area.

Photo of a Moderna vaccine vial
Austin Public Health coronavirus vaccine portal opens to all adults April 12

APH will continue outreach efforts to high-priority groups.

Austin Public Health holds a vaccination clinic at the Delco Activity Center in Northeast Austin. (Jack Flagler/Community Impact Newspaper)
Coronavirus updates from Austin, Travis County; governor bans 'vaccine passports' and more top Central Texas news

Read the most popular business and community news from the past week from Central Texas.

Tavel Bristol-Joseph has started a scholarship fund that will provide $6,000 to two Austin Community College Culinary Arts students and give them opportunity to be mentored by Bristol-Joseph and to stage at one of the Emmer & Rye group's five restaurants. (Courtesy Emmer & Rye)
Austin chef starts scholarship and mentorship program for Austin Community College students

Tavel Bristol-Joseph started the scholarship fund, which will provide $6,000 to two ACC students and give them the opportunity to stage at one of the Emmer & Rye group's five restaurants.

Snow and ice cover the pond on the southeastern side of the Mueller development in East Austin in February. (Jack Flagler/Community Impact Newspaper)
After winter storm, Austin puts together a plan for better temporary shelters

The locations, which could be schools, libraries or recreation centers, would be disconnected from traditional infrastructure and be able to sustain operations if the city were to experience widespread power or water outages.

Austin ISD is holding community conversation sessions April 12-May 6. (Nicholas Cicale/Community Impact Newspaper)
Austin ISD community conversation sessions continuing through May 6

The series offers AISD families an opportunity to learn about the district’s strategic plan and ongoing budget planning.

Photo of a spread of fancy food
Lutie's Garden Restaurant now open at Commodore Perry Estate

The restuarant features "Texas heritage fare" by an award-winning husband-and-wife pair of chefs.

A resident at EdenHill Communities receives their second dose of Pfizer's COVID-19 vaccine. (Lauren Canterberry/Community Impact Newspaper)
Amid the struggle to get vaccinated, these Austin moms have helped over 3,900 people get appointments

The women volunteer their time searching for hard-to-find time slots that often become available in the middle of the night.