Austin looks to smaller I-35 cap plan ahead of May funding decision

Austin's cap development is separate from other decks The University of Texas at Austin is planning for to extend its campus and medical district.

Zooming in

The city's entire capping program would cost above $1 billion. But with limited debt capacity for new infrastructure and the now-likely loss of $105 million in expected federal funding, city staff now recommend paring down the project to just a few central caps.

Our Future 35 includes more than 26 acres of new public space between Lady Bird Lake and Airport Boulevard. The latest staff recommendation would cut most of that, leaving only a 5.37-acre span from Cesar Chavez to Fourth streets and just over 2 acres covering 11th and 12th streets.

The expensive caps are viewed as a public amenity, but local leaders have also eyed the potential to generate revenue and spur redevelopment or other economic activity around the highway. New analysis presented by consultant Hayat Brown suggests the project wouldn't bring a positive return on investment for the city though, even accounting for potential leases on the decks and rising property values along the interstate.

Hayat Brown also found cap development costs of $34 million to $43 million per acre have soared many times above what it'd cost to buy property or new parkland in Central Austin.

What they're saying

The prospect of significant spending on caps drew split opinions during a May 6 City Council work session. The decision carries long-term implications; current payments would extend for years, and Austin would have to wait until the 2040s to plan any new caps after the current round of construction.

Several leaders whose districts include I-35 highlighted the perceived benefits of what's viewed as a generational infrastructure investment and public good. Others stated their concern about the financial impacts of dedicating tens or hundreds of millions of dollars to an uncertain outcome.

Council member Mike Siegel—representing District 7, where no caps are currently planned—shared skepticism about the funding outlook with possible reliance on local philanthropy to fill in any gaps. He said spending limited dollars on the decks when completion remains in doubt could represent a missed opportunity for other key investments to support residents.

Council member Krista Laine, representing District 6 in Northwest Austin, also said the city can't do as much with priorities like housing and other community services if funding is tied up in the caps. She also said Austin's lack of private funding is out of line with other highway capping initiatives, and that the city can no longer build major infrastructure projects on its own.

“If we don’t see commitments that bring us into the range of peer cities, then we are saying that we think—in a much tougher climate than we have encountered—we will be able to do more than we have ever done, and than other peer cities have done," Laine said.

Council member Natasha Harper-Madison said east side communities will never be able to fully recover from Austin's history of racism and segregationist land-use practices, and that any bridge across the symbolic dividing line would be an unquantifiable benefit.

“The reconnection of our city, reconnection, that means we have to acknowledge that there was an intentional, deliberate division. What was the cost of that?” she said.

A council subquorum mainly representing the central I-35 corridor also proposed funding strategies that could be used on caps, like increased city fees and tying the caps to the Austin Convention Center expansion. Council member Ryan Alter said the plan could produce hundreds of millions of dollars, with some added philanthropic support.

“These caps can bring so much value to Austin, and we will not get another chance in our lifetimes to do this," said subquorum member José Velásquez. "For me, this is about healing a scar that I’ve lived through, that ripped through our city almost 100 years ago ... a division that was literally cemented when I-35 came through, also known to some in East Austin as the ‘Great Wall’ of Austin. This is about making right a division that should never have existed."

Council member Paige Ellis shared strong opposition to one aspect of Alter's outline: pulling already-approved mobility bond dollars for the Redbud Trail Bridge replacement in her district. It remains to be seen if officials pursue that plan or other options before their TxDOT's deadline this month.