Decision nears on funding up to $1.4B amenity decks over I-35 in Austin

The city plan doesn't include large caps running along The University of Texas at Austin campus, which are being separately developed by the university and TxDOT. Those decks could extend the campus and growing downtown medical district, potentially with taller structures.

It remains to be seen how Austin would pay for the projects outside of a $105 million federal grant awarded last year for the largest planned cap covering Cesar Chavez to Fourth streets—which is now in question due to funding uncertainty under the new federal administration. Austin hasn't heard from the Department of Transportation on whether that money is still coming through, Assistant City Manager Mike Rogers told City Council.

City leaders have previously floated various financing options and have yet to decide on which decks they'll seek to build. That decision was initially expected late last year, but a few months' delay means they now face a May deadline to at least commit to funding infrastructure needed for future caps, which aren't included in TxDOT's project.

Zooming in

City estimates now show individual caps and stitches—ranging from 0.27 to 5.37 acres—could each cost hundreds of millions of dollars to design and build. After completion, maintenance would cost tens of millions more each year.

Council members are now considering the prospect of saddling the city with a $1 billion-plus initiative amid growing financial uncertainty, versus not building any decks and missing out on a longtime community goal—and likely losing the chance to add any new structures for years. If project plans aren't finalized by 2033, Austin wouldn't be able to try again until the 2040s.

“After 2026, we should expect change order cost escalations on the order of 35%-45% of these numbers. And if we extend these payment dates all the way out to 2033, it’s quite possible you could see these numbers double," Transportation Director Richard Mendoza said.

What they're saying

Officials generally expressed support for funding the base roadway additions for future caps during an April 8 review of the plans. Council member Mike Siegel noted Austin faces the May deadline while also planning for a major bond package next fall and contending with other financial challenges, and that more discussion is needed. Additional council meetings could be scheduled in May to go over the city's options, he said.

Council member Ryan Alter said he's working with council members José Velásquez, Chito Vela and Zo Qadri on financing options that could "lessen the blow" for Austin without impacting the 2026 bond process. He said he believes it's essential to preserve options for future caps.

“If we don’t put the roadway supports in place, that conversation will never happen; that opportunity will never happen. We close the door permanently, and that is something that is unusual for us," he said.

Officials and staff also suggested more funding from other sources, as the bill for Austin's caps and stitches is far beyond what other cities paid for similar projects under public-private partnerships or with philanthropic support. Vela said Austin would be at a "competitive disadvantage" to other destinations if it doesn't prepare for future caps, especially after other major projects like the convention center and airport ended up being too small and are now being redeveloped and expanded.

"If you think that the next 25 years are going to look like the last 25 years—and I do, I’m very bullish on Austin—we’ve got to take this opportunity to get the foundational elements in place and then build as much as we can, particularly in the downtown area where they will have a very large economic development impact," he said.

Several members also said they want to take the opportunity to improve quality of life and walkability for residents and visitors around downtown. They also pointed to the longtime equity impacts of I-35 separating the east and west sides of town, with council member Natasha Harper-Madison calling out the "sustained community division" that historically left poorer east side residents behind amid urban development and rising economic prosperity.

“Every decision we make has implications, financial and otherwise. When do we make it right?" she said. "One of the things we can do to make it right is transit infrastructure decisions that won’t continue to affect people that live on that side of the highway."