Austin’s new zoning code has its day in court

I finally got around to watching last week’s hearing in Acuna v. City of Austin, the case that for nearly two years has blocked City Council from overhauling Austin’s backwards land development code.

Background

The last hearing on this case was on Wednesday, March 11, 2020, a few days before the world went into Covid lockdown. A couple weeks later Travis County District Judge Jan Soifer sided with the 11 property owners who sued the city. She rejected the city’s argument that a comprehensive rewrite of the zoning code is exempt from the notification and protest requirements that apply to typical zoning cases. Therefore, she ruled, to implement a new zoning code, the city must:

  1. Notify all affected property owners
  2. Approve the code with a ¾ majority if there are property owners protesting the rezoning of their property

When I refer to “protests,” I’m referring to a process often described as the “valid petition.” State law says that City Council needs a ¾ majority to approve a rezoning if it is opposed either by the owner of the property or those who own at least 20% of the property within 200 feet.

The appeal

On Wednesday Jane Webre, a veteran trial attorney hired by the city, finally got a chance to appeal the ruling in a Zoom call before a three-judge panel of Texas’ 14th Court of Appeals in Houston. She argued the court should reverse Soifer’s ruling for three reasons:

  1. Austin’s proposed new zoning code is tantamount to initial zoning, which Texas statute clearly says does not require notice to individual property owners. For instance, if Houston, which currently lacks zoning, wants to adopt its first ever zoning ordinance, it would not be required to provide notice. Nor would its City Council need to pass the new ordinance with a ¾ majority, as is the case in typical rezonings that are protested by affected property owners. 
  2. Individualized notice and protest provisions make no sense for a comprehensive revision. Those provisions are designed to deal with a discrete rezoning that uniquely affects a single property owner and his/her neighbors, not a rezoning that affects every property in the city. If the typical notification process were followed here, the city would not only have to notify every property owner in the city about how their property is being rezoned, but would have to notify them about how every property within 500 feet of them is being rezoned. We’re talking about potentially dozens of notifications per property. 
  3. The Texas Supreme Court held in a recent case, FLCT Ltd v. City of Frisco, that a zoning change that is applied uniformly across the city is not subject to notification/protest provisions. In that case, a property owner sued the city of Frisco over an ordinance that banned alcohol sales within 300 feet of schools.

Just how ‘uniform’ are the new zones?

Chief Justice Tracy Christopher, a Republican, did most of the questioning. She was skeptical that FLCT applied, she said, since in that instance it was a uniform rule change but every property retained its “zoning classification.” She also pushed back on the idea that some property owners wouldn’t be “uniquely affected” by the zoning code overhaul.

Webre countered that Austin’s proposed new zoning code puts in place uniform rules that are applied consistently, much like the alcohol sales ordinance in Frisco. Her home in Central Austin, for instance, is currently zoned SF-3 but under the new code will become RM1 due to its proximity to a major corridor. Any other SF-3 home in the city that is the same distance from a corridor will get the same zoning, she suggested.

“None of these rules are map-based or area-based,” she said. “They are text-based.”

The messy reality is that City Council made this argument much harder for Webre when it asked staff to rezone properties based on “neighborhood typologies,” of which there are four. The typologies refer to the gentrification risk identified in a UT study a few years ago.

Christopher wondered if the city is arguing that it is repealing the existing zoning code and replacing it with entirely new zoning, which could therefore be described as “initial zoning.”

Not exactly, said Webre, who then had the awkward obligation of explaining that some parts of the old code will continue to exist. There will be the new code, Title 23, while the old code, Title 25, “will live in the shadows.” Essentially, Title 25 refers to things City Council didn’t have the guts to change, such as the Neighborhood Conservation Combining Districts in Hyde Park and Travis Heights.

The justices also noted that state law allows the city to comply with notification requirements without contacting every individual property owner. Here’s how: with a ⅔ vote, City Council can take up the zoning case through a joint meeting with the Planning Commission (typically the commission hears it, makes a recommendation and then Council acts on it separately). For some reason in the 80’s state lawmakers came up this weird joint hearing as a substitute for individual notification of property owners. It makes no sense to me.

Webre argued that the joint hearing would result in “terrible policy.” Best practice is for the Planning Commission to review evidence, hear testimony and deliberate independently, she said.

The real problem is not notification. It’s the 3/4 majority

The real reason Council has not bothered with the joint hearing is because it doesn’t actually solve their problem, which is not notification but the protests. Soifer ruled that the property owners protesting the new zoning code trigger a ¾ majority threshold to pass it, and there has never been a ¾ majority in favor of the new LDC.

Plaintiffs: a rezoning is a rezoning

In his remarks, the attorney for the plaintiffs, Douglas Becker, argued that state statute does not treat a comprehensive zoning change as different from smaller rezonings. The Frisco case involved a uniform rule change that applied “districtwide or across multiple districts” but did not result in a change in zoning classification.

In contrast, the proposed LDC overhaul would dramatically change the allowable uses on certain properties. For instance, ten of his plaintiffs, he said, have properties zoned SF-3, but in the proposed new code their properties will fall under five different zoning classifications that will allow various levels of density.

The new LDC does not fall under the “initial zoning” provision of state law and there’s a good reason that statute raises the threshold for approval for rezonings, he argued:

“When you have initial zoning, property owners aren’t zoned yet to be anything. When they buy their residence they know, ‘well I’m not zoned now but I’m at risk of being zoned at any time and a simple (Council) majority can do that…But our plaintiffs are people who bought property in their residential neighborhoods that was already zoned. They have some expectation that that zoning is going to be maintained unless there is a very good reason to change it.”

For the record, this reasoning is completely backwards. Putting in place zoning where no zoning previously existed is a greater act of regulatory violence than rezoning. If you buy your property thinking you can do anything with it and then the city puts in place a zoning ordinance that strictly regulates what you can do with it, that’s a much bigger deal than the city rezoning your property to allow you to build a second unit.

20% of what?

In her rebuttal, Webre argued that the protests that have been filed against the proposed new code should not trigger the ¾ majority threshold because it is practically impossible to determine whether the protesters account for 20% of the land being rezoned. In a typical zoning case, the ¾ threshold is triggered if those protesting the rezoning own at least 20% of the land within 200 feet of the property being rezoned.

So in the case of a citywide rezoning, asked Webre, what is the city to make of these protests? Does it add up the property of all 14,000 protests to determine whether they account for 20% of the city’s land?

We’re probably screwed

I’m not any kind of legal expert, but if I had to guess the court will uphold Soifer’s decision. I think Webre did the best she could with what she had, but I suspect the judges are comfortable with the idea that if City Council wants a new code, it just needs a 3/4 majority. It’s unfortunate that that requirement will prevent the city from taking meaningful action to address a dire housing crisis.

Tomorrow, however, we’ll look at the smaller steps some on Council are taking in the absence of a code overhaul. There certainly are some improvements that can get nine votes on Council that are worth doing, even if they fall far short of what we need.

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