The city has long grappled with three downtown-related questions: whether to expand the convention center; how to adequately address the growing homeless population; and how to keep its local music and cultural arts vibrant. Last week, Mayor Steve Adler announced a strategy that would help provide answers to those questions.
Adler’s idea would leverage tourism dollars to address homelessness downtown, as well as to provide long-awaited funding for cultural arts and historical preservation, and to support the local music industry.
Dubbed the “Downtown Puzzle Plan,” Adler’s vision is simple in concept: Build a larger convention center to attract more visitors, who pay higher hotel taxes. Added revenues would help to pay for projects creating a better experience for tourists, as well as Austin residents. However, pulling off such a sweeping plan would be complicated.
Funding hinges on the mayor’s proposal for a total 3-percent increase in the city’s hotel occupancy tax. Of that amount, the mayor is proposing a 1-percent increase to create a Tourism Public Improvement District. The hikes would generate funds for the convention center expansion and to fund projects for homelessness, cultural arts and historic preservation. The plan also calls for the creation of a new downtown tax increment finance district that would potentially create $30 million for a project that address homelessness.
At the same time, because of its proximity, Adler is proposing to extend the duration of the Waller Creek Tax Increment Financing District to raise $110 million to partially fund restoration of Waller Creek and to create a chain of parks.
Adler says Austin hotels pledged to agree to the tax increase on the condition that the city use funds from the increase to expand the convention center.
We spoke with Adler about his plan. The following is an edited version of that conversation:
Does Austin need a bigger convention center?
I’ve seen a lot of information, data and anecdotal stuff from other cities that say we shouldn’t be financing a convention center out of the general fund with bonds paid for by property taxes.
That’s not what we are looking at here. The public is not financing a convention center and doesn’t need the convention center to be able to pay back the debt from its operating fund.
Does data support the need for expansion? What happens to cultural and historic projects in the plan if the hotel tax fails to produce as much revenue as projected?
Folks advocating for an expansion say they can fill it up — and that the demand exists to make use of an expansion. The people who will ultimately decide if that’s true are the people who invest in the convention center. That’s not the city.
Is there any financial risk for the city?
The bond company who will lend investors the money for the expansion will base its decision on hotel revenue going up over 3 percent. It is the bond holders who will assume any risk; the city would not be putting up anything.
What are some specific homelessness problems the city is dealing with?
We have a lot of stakeholder groups doing a lot of good things with the homeless population, but we still have a lot of people who need support who aren’t getting it. A lot of homeless people who are not able to get into housing become prey for predators, like those who push K2 (synthetic cannabis), as well as crime that goes beyond that. And whether it’s the homeless or others around the homeless community, panhandling is an issue in the city. The primary thing now is trying to figure out how to develop the political will and the resources to help the homeless population.
What types of projects to help the homeless do you envision would be funded by the Downtown Puzzle Plan?
I don’t see the Austin Resource Center for the Homeless moving. I think we try to figure out how to use the existing facility in the way as it was originally envisioned: as a triage where folks can come in for a day or two, get assessed and tied to appropriate social and human services and then moved to better supportive housing. Experts say if we really want to help the homeless community, it begins with helping them get a home, so that they can better take advantage of services and opportunities made available to them. I don’t know what the specific plan for execution looks like, but I know we need one.
Including the commercial music industry?
One thing that makes Austin special is that we are the Live Music Capital of the World, so we have a lot of pods and venues where artists can grow up and learn their craft. But with affordability issues in the city, that is becoming harder to do in this cities, like in so many others. A lot of cities grow with the same pressures and don’t do a good job of addressing them — and then they become cities that consume art instead of creating art. Creating art is a huge part of who we are as a city, so helping the commercial music industry would be consistent with saving and protecting what is special about Austin.
Are there no other funding avenues to tap for programs that address the city’s homeless crisis?
We’ve yet to identify another practically available option that does not require general funds or a property tax increase that has the critical mass of support from so many different people in the community rowing in the same direction.
Who, if anyone, could potentially be displaced by any part of the Downtown Puzzle Plan? Is a committee studying such a potential threat?
We need to be looking at the issue of displacement in everything that we do as a city. This is no exception to that. Any execution of any aspect of the convention center component has to make sure that displacement doesn’t happen.
What is the funding breakdown for the proposed arts, cultural and historic projects identified in the Downtown Puzzle Plan?
We know that $3 million can go to music and $3 million can go to historic preservation. We also know from the Visitor Impact Task Force numbers that $50 million have been identified for things like the MACC, Palm School and Austin Downtown Alliance – but there hasn’t been a breakdown of the dollars.