Austin to consider affordable housing mandate for some new complexes

A City Council committee could take the first steps Tuesday toward mandating that developers include affordable units in new housing complexes to be built in several East Austin neighborhoods.

The proposal by Council Member Greg Casar, who chairs the council’s Planning and Neighborhoods Committee, comes as soaring rents have pushed poorer and minority residents out of the city.

Even if approved by the committee, the recommendation would still need the support of the City Council before the staff would be ordered to develop a plan, which in turn would need another council vote before becoming law.

Any mandate would be a dramatic shift from the city’s current incentive-based “bonus density” approach, which allows developers to build larger projects in certain areas in exchange for including some affordable units or paying into the city’s housing fund.

Some developers opt to simply pay the fee, and council members have said that leaves the city without the affordable units that residents need.

“I am not interested in just saying that we want affordable housing and then end up not getting it,” Casar said. He later added, “New market-rate units are never going to serve lower-income people.”

Though a 2005 state law largely bans cities from mandating that developers build affordable housing, lawmakers carved out an exception for poorer neighborhoods that cities designate as “homestead preservation districts.”

Austin created its first district in 2007, covering much of central East Austin, a collection of historically black and Latino neighborhoods that sits at the center of Austin’s raging debate over gentrification.

Last December, the city created three more districts, covering East Austin neighborhoods east of Springdale Road, communities along East Riverside Drive and portions of the St. John’s and Coronado Hills neighborhoods.

A recent study by the University of Texas found that 56 percent of African-American homeowners who left Austin for the suburbs said that soaring housing costs had forced them out of the city.

“We’ve been asking for mandatory inclusionary housing, but because the state doesn’t allow it, we don’t have it,” said Ruby Roa, a longtime housing activist in the city. “I think it’s time the city of Austin do something about affordable housing.”

She said any future affordable housing needs to focus on the poorest, who make less than half of the median family income — roughly $37,700 a year for a family of four, which equates to 2.5 full-time minimum wage jobs.

An affordable housing mandate is part of the package of affordable housing recommendations Casar plans to introduce Tuesday.

His plan also calls for changing the city code to allow for smaller lots to produce more housing, a fight that’s long been a source of friction between developers and neighborhoods.

And it calls for dedicating future property tax revenue from land sold by the county or state government to private developers to support affordable housing programs, an idea recently offered by Council Member Kathie Tovo. The city already diverts some of that revenue from properties sold by city government to a private owner.

Casar’s plan also calls for a comprehensive review of the controversial “bonus density” incentive program.

Under current rules, each area with a “bonus” program — including downtown, Rainey Street and West Campus — has different requirements that developers have to hit to build larger buildings.

Developers have complained that the affordability rules in some neighborhoods are so onerous that some projects in high-demand neighborhoods have declined to go for the extra space.

Casar is calling for a “comprehensive local real estate market analysis” to re-examine the bonus density program from top to bottom to see what can be done to get it to produce more units.

“Developers have a choice to either take an additional story and give us a little bit of affordability or just use their entitlements,” said Stuart Hersh, who oversaw the creation in the early 2000s of the city’s SMART housing program, which promotes the development of housing for lower-income residents.

Take the Rainey Street developments, for example, Hersh said, where the city has had little luck cajoling developers into providing affordable units in the luxury developments that line the street.

“We’ve had no SMART housing in Rainey Street ever,” Hersh said. “What we’ve tried to do as a city has not worked, and the outcomes are clear.”

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