A better way for I-35

This is an excerpt from the April 22 edition of the Austin Politics Newsletter. To get daily breaking news and analysis on city politics, click here to subscribe. 

A mixture of apathy and ignorance among Austin’s political and civic leaders is putting at risk billions of dollars of downtown property and hundreds of millions of dollars in tax revenue.

I’m talking, of course, about TxDOT’s planned expansion of I-35. It is a disgrace and it needs to be stopped. Everyone, car-haters and road warriors alike, should understand that there is a much better way to do this project.

The better way: Reconnect

The practical alternative is the vision laid out by Reconnect Austin, which proposes burying I-35 from Lady Bird Lake to Airport Blvd and building an urban boulevard on top. According to Sinclair Black, the legendary local urban designer and planner who helped craft the vision, the boulevard would include three vehicle lanes in each direction while the highway underneath the cap would include five lanes in each direction, for a total of 16 vehicle lanes on the corridor.

Here’s a rendering of the reimagined corridor:

Countless benefits

I will devote but one paragraph to listing the lofty goals this vision advances before moving on to the central argument.

So, the new boulevard would reconnect the urban street grid, allowing for easier east-west travel by all modes, including foot and bike. Burying the highway will reduce air pollution and the consequent health effects that disproportionately hurt the poor people most likely to live near highways. The new boulevard will include a 70-ft median that will create another opportunity for dedicated transit lanes. The project will do away with an ugly symbol of segregation.

But the most important benefit…

Now, on to the biggest and best argument: money. Right now the space taken up by I-35 and its frontage roads has a tax value of $0. The Reconnect concept would do away with the frontage roads, thus freeing up 74 acres of the most valuable land in Central Texas to be developed.

Wait, how can you just get rid of frontage roads? Easy, the boulevard makes the frontage roads superfluous. The only reason frontage roads exist is to provide access to properties along the highway, particularly when the highway being built is replacing an existing road, as was the case with I-35. Now, instead of accessing the frontage road, neighboring businesses could access the boulevard, just like any other major corridor in town.

The Reconnect team has estimated that the new land would yield more than $6 billion in taxable value. I haven’t analyzed their methodology yet but you don’t have to be an expert in real estate economics to know that 74 acres of property in and around downtown is worth billions. In one of the few publicly-disclosed real estate deals, the Railyard Condos sold in 2019 for $1,471 per square foot. That cost applied to 74 acres = $4.8 billion.

Now, the Railyard is in an extremely valuable part of downtown, whereas other parts of the I-35 corridor are significantly less valuable. On the other hand, the price of land in Austin continues to soar and the value of property abutting I-35 should only increase when the current corridor’s major downsides (pollution, noise, ugliness) are buried and replaced with a thing that people actually want to be on and look at. So $6 billion doesn’t sound crazy; nor would an even higher figure.

In the long-term, this new land value can deliver desperately-needed tax revenue for the school district and city and county government. In the shorter-term, however, the tax generated by the new property can be used to pay for the project itself via tax increment financing (TIF).

Basically, city government sets up a Tax Increment Reinvestment Zone (TIRZ) that encompasses all of the new developable land (and possibly some neighboring properties that can reasonably be expected to increase in value due to the project). Any new property revenue derived from that zone is dedicated to paying off the project. After the project is paid off, the properties return to the general tax rolls.

Or at least that’s how TIF works for a straightforward city project. Of course, the I-35 project is planned to be funded with state and federal dollars. Obviously the city doesn’t want that to change, but if TxDOT refuses to pay for the costs of burying I-35 and building the boulevard, then the city can volunteer to take on those costs via TIF while TxDOT commits to building the highway itself, as planned.

The cap-and-stitch bait and switch

In what was likely an attempt to distract from Reconnect, TxDOT has said it will consider a “cap-and-stitch” alternative that partially reconnects the urban grid by depressing parts of the highway. The Urban Land Institute studied a version of that idea that would create 11 acres of capped segments, projecting capital costs of $260M and 30/yr maintenance costs of $53M. ULI then evaluated a potential TIRZ that would surround I-35 to pay for it and projected that the new tax revenue would fall short of covering the costs.

But the project ULI reviewed does not remove the frontage roads and doesn’t create a boulevard. It simply accepts the nonsensical premise that the frontage roads must remain, perhaps because TxDOT has insisted that they must remain.

Again, there’s no reason the frontage roads must remain. TxDOT itself has questioned the utility of frontage roads in the past, even in scenarios that do not offer a boulevard that solves the access issue. Here’s a 200-page analysis of the costs and benefits of frontage roads in Texas from 2001, if you’re interested.

Local leaders need to step up

Right now Reconnect is not getting the attention it deserves from local leaders, who appear resigned to trying to negotiate over crumbs with TxDOT. Yes, City Council passed a vague resolution describing its hope that TxDOT will consider ways to make the I-35 plan better, including by considering proposals such as Reconnect, but nothing will come of it unless local leaders and the community unite behind a viable alternative to TxDOT’s 50’s-era proposal.

I think part of the problem is that too many local leaders don’t fully understand Reconnect. They are mistakenly trusting that TxDOT has a reason for paving over more of downtown besides a stubborn refusal to consider alternatives. Until recently, my own flawed impression of Reconnect, based on what some of its advocates had said, was that it proposed some pie-in-the-sky plan to build a park on top of the highway. That’s definitely not it –– even if there will hopefully be some delightful green space included at various points in the median.

(I would be remiss to neglect an even more radical plan that has been proposed by a group of urbanists: ReThink35. That plan proposes simply replacing the highway with a boulevard. I’m going to catch some flak for saying it, but that’s not realistic politically. Whether or not they say it publicly, many of Austin’s leaders believe that an expansion is necessary.)

As TxDOT barrels ahead with this project, Austin’s leaders should look to their counterparts in Houston, who convinced Transportation Secretary Pete Buttigieg to halt a similarly misguided highway expansion project. The same can happen here, but it will likely take more than just the usual gang of highway critics. It requires our political leaders, including those who are friendly to expanding I-35, to unite behind an alternative. That alternative is Reconnect Austin.

You can read their full proposal here.

This is an excerpt from the April 22 edition of the Austin Politics Newsletter. To get daily breaking news and analysis on city politics, click here to subscribe. 

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