What to do about revenue caps?

As you may have heard, the Legislature just approved property tax “reform.” The good news is that that included $6 billion of new state funds for schools. The bad news is just about everything else.

The city of Austin, Travis County and most other local governments will now be limited to 3.5% annual increases in property tax revenue unless they get approval from voters. That’s down from the current 8% limit.

There hasn’t been a rollback election in Austin in recent memory. Will it become a normal thing? Maybe not normal, but it could become an occasionally useful tool.

The good news for progressives is that the law requires the election to take place in November. That is logical, since it would follow soon after Sept. 30, the state-mandated deadline for local governments to complete their budgets and certify their tax rates. But November elections, particularly during national election years, generate the highest voter turnout and give liberals a fighting chance of mounting a campaign that appeals to their base. 

If the rollback elections could take place in weird times of the year, the electorate would be dominated by older homeowners who are frustrated about property taxes. If the city wants an electorate amenable to property tax increases, then it needs as many voters at the polls who don’t pay property taxes directly.

The new revenue caps don’t go into effect until next year, so this year the city of Austin and all other taxing jurisdictions should go all the way up to the 8% limit to a) establish a higher floor that future increases will based on and b) get some extra cash to put into reserves in preparation for lean times.

However, if there is strong messaging and dedicated campaigning, I can imagine Austin voters approving the city going above the 3.5% revenue cap at the polls in 2020, along with a major transit bond (and hopefully) a major bond targeting pedestrian/bike infrastructure.

At the very least, I hope that the mayor and other Council members who recklessly approved increases in the regressive homestead exemption in past years will not even consider increasing it again.

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Austin’s booming burbs

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The proposed I-35 expansion.

Interesting story in the Statesman today about the growth of small cities in Texas.

Among the top 15 cities with the highest growth rate, about half were in Texas, including two Austin-area suburbs in Williamson County. Georgetown came in at No. 7, with an annual growth rate of 5.2%, and Round Rock was No. 15 and grew by 4.3%.

Other smaller Central Texas cities grew even faster, though they did not make the list because their populations don’t exceed 50,000 people. Dripping Springs grew by 20.59%, Leander by 12.5% percent and Kyle by 8.1%, all increases similar to those seen in previous years and continuing a boom along the Interstate 35 corridor.

“I think it’s interesting San Antonio really has joined the ranks of high-growth cities in the country,” Austin demographer Ryan Robinson said. “I think that’s interesting because Austin and San Antonio are developing more of a relationship than we have in the past. We are becoming one big urban region. … Starting in Bell County and ending in Bexar County, everything along the Interstate 35 corridor is growing like crazy. It is really beginning to act like one big urban creature.”

Obviously there have been people living in these communities for decades for a variety of reasons. Some people want big houses and don’t like living next-door to hippies. But this tremendous level of population growth –– far outpacing growth in the city of Austin –– is largely a reflection of the city’s affordability and mobility crises.

For what it’s worth, here are a few reasons I can imagine moving to one of the burbs in the coming years.

  1. The city hasn’t allowed enough housing in the city, so housing will become too expensive for us to remain near the city center. So there’s a good chance that while we’ll still be able to afford to live within city limits, we’ll probably have to move further out and sacrifice the car-light lifestyle we enjoy centrally.
  2. Because it hasn’t provided enough housing, the city isn’t dense enough to provide robust public transportation. As a result, living in the city doesn’t offer as much of a transportation discount as it should.
  3. Again, the lack of density and the lack of investment in pedestrian/bike infrastructure means that much of the city is not substantially more walkable than the suburbs, so what’s the point of paying a lot more to stay in town?

Sadly, as growth continues in the burbs, the perceived need to invest in regional highways over urban transit will grow, including the $8 billion expansion of I-35.

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Austin’s suburbanized infill

The New York Times had a story recently about the suburbanization of cities. The basic premise is that wealthy people are increasingly choosing to live in cities but they’re bringing along much of the suburban ethos: large homes, abundant parking, big yards, big box stores.

The dividing line between urban and suburban limits has always been a little murky in most cities, many of which have their own vast stretches of single-family homes with attached garages. But the general idea was that the suburbs offered comfort and personal space, private backyards and a bedroom for each kid. City living was more exciting and offered culture and a more diverse mix of everything, but required some sacrifice. Apartments were smaller, parking a headache and a backyard unimaginable.

Today, the cost of city living in many areas is higher but the trade-offs for those who can afford it are fewer.

The result is that the idea of a city itself is changing. In some ways, living in a dense urban area has become much more pleasant for certain types of people — namely the affluent and those who prize proximity to the action above all else. You can now live within easy walking distance of your favorite restaurants, go see a play and shop at Target nearby. But what does it mean when urban living becomes a luxury good and a lifestyle brand?

This story rings true even in Austin, where single-family homes and yards have always been the norm. As much as people complain about density, the main reason that single-family homes are demolished in Central Austin is so that they can be replaced with much bigger single-family homes.

Meanwhile, even projects that are touted as urbanist infill end up catering largely to wealthy people seeking spacious accommodations. Just look at the Grove, the major mixed-use development under construction at 45th & Bull Creek. Of the nine floor plans available for single-family homes, eight of them are greater than 4,000 square feet. While they are offering some smaller condos between 1000-1,400 sf, almost none of their townhomes are under 2,000, while some of them are over 4,000!

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The Vantage Series houses at the Grove range from 4,059-4,737 sq ft. Starting at $1.56M.

Mueller is frequently derided as pseudo-urbanist, but jeez, you’ll rarely see a house anywhere near 4,000 sq ft over there.

Ironically, it appears that many of residences of what was framed as a compact-and-connected New Urbanist development will be much larger than the single-family homes in the surrounding neighborhoods, most of which are between 1,200-1,800 square feet.

Granted, the single-family homes and townhomes are just one part of the Grove. There will also be apartment buildings offering units that are smaller and cheaper. Although I fear that they will still be much larger than average.

Some of this is simply driven by the market. Central Austin is attracting wealth from all around the world. However, some of it is a result of political constraints. You can’t be surprised that developers build million dollar monstrosities when you put a unit maximum on a property, as Council did on the Grove. That was a once-in-a-generation opportunity that we screwed up big-time.

If we want the new housing in this city to accommodate more than the rich, we need to encourage developers to build smaller and cheaper. Otherwise, the only way they’ll be able to turn a profit on the land is to build luxury housing.

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Sidewalks are increasing

It’s too bad that Austin has largely been growing out instead of up. But at least our sprawl development has not been free of sidewalks. In fact, most street frontage in Austin now has sidewalks. Here’s the source.

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What explains the rapid increase? Part of the reason is definitely that about a decade ago the city began requiring that new development include sidewalks. The city has also been investing to build sidewalks in neighborhoods that have always lacked them.

Even walkability allies are critical of the sidewalk requirements. Homeowners are often required to add a sidewalk simply for rehabbing their home or adding a garage apartment to their property. That requirement can deter the addition of housing. Some Council members have asked that the new code lift that requirement for very small projects.

Austin’s undeveloped land

I came across some interesting charts on the city’s Open Data portal. The data tracks Austin’s progress towards the “compact & connected” goals of Imagine Austin, the comprehensive plan that City Council adopted in 2012.

From 2008-16, Austin’s developed land increased by 50 square miles, from roughly 325 to 375. The green on this map is the 2010 development footprint, while the red is land that developed in the subsequent six years. The gray is undeveloped and the yellow is open space.

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Look at all that gray in the east. To those who believe the great majority of the urban core should remain dedicated to single-family homes, those big gray patches are the solution to our housing crisis.

Hence, a recent debate at Council over minimum lot sizes. Reformers have pushed for eliminating minimum lot sizes citywide, while West/Central Austin preservationists countered that that might be OK … but only on undeveloped land. So cheaper forms of housing would be legalized east of 183 but would remain largely prohibited in the city’s most highest-opportunity areas.

It’s in this context that I look wistfully at the debate over the Grove at Shoal Creek back in 2016. That giant tract of formerly state-owned land was one of the few examples of undeveloped land in Central Austin resulted in a development that was nowhere near as dense as it could/should have been, with neighbors demanding a 1,515 unit cap on the 76-acre property. Little surprise then to see that the developer, Milestone, is now building gargantuan single-family houses and townhomes priced at over $1M.

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What’s a ‘high-comfort’ bike route?

The Transportation Department has a cool map that assigns a biking comfort level to all major streets around the city.

Green = high-comfort routes, blue = medium, yellow = low and pink = very low.

I definitely like the idea, but I’ve got a few bones to pick with the ratings. In general, I think way too many streets are being classified as “medium” level comfort.

For instance, if we take a look at South Central Austin, where I live, the death trap known as South Lamar Boulevard is colored blue. True, there is a bike lane, but it is unprotected and runs alongside a steady stream of vehicles traveling at upwards of 40 mph. Worse still are the cars crossing the bike lane to get back onto the street from the zillions of commercial driveways.

Any knowledgable biker would say that if you’re going downtown, you’d be much more “comfortable” taking South 5th. It doesn’t have any bike lane, but it’s a relatively quiet, residential street where there are far fewer cars and they are generally traveling much more slowly. It’s also very scenic and mostly shaded.

So it doesn’t make sense that S. Lamar and S. 5th have the same rating. I don’t know how I would rate them, but I know that the latter is clearly superior and the map should reflect that somehow.

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Weekday ridership still lagging

The March ridership figures for Cap Metro are in. Overall ridership is up 1% over March 2018. However, Cap Metro notes,  March ’18 had one more weekday than March ’19. Had they had the same number of weekdays, ridership would have been up 3%, the agency estimates.

Ten months after the implementation of Cap ReMap, which redrew the bus network to prioritize straighter routes and more than doubled the number of frequent routes (every 15 mins during peak hours), ridership is up 3.4%.

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This apparent good news, however, is tempered by the fact that weekday ridership is relatively stagnant. The ridership gains from Cap Remap are due to increases in weekend rides, particularly Sunday rides.

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As I’ve explained before, increased weekend ridership is great. Clearly, it is due to Cap Metro’s decision to run buses as frequently on weekends as weekdays. That means that on the 14 frequent routes, buses now come every 15 minutes during peak hours (6 am-8 pm), while on other regular routes they come every 30 minutes. Before Cap ReMap, weekend service was significantly worse.

The problem is, weekend ridership will never be as high as weekday ridership. We’re spending the same amount of money to run buses on Saturdays and Sundays as we are any other day, but we’re recouping far less in fare revenue. Sunday ridership is up 18.4% over last year and yet the average bus on Sunday is carrying fewer than half as many passengers as a weekday bus.

The money we’re investing to boost weekend ridership wouldn’t be as much of a concern if there was a corresponding increase in weekday ridership to make up for the big weekend subsidy.

The good news is that the slide has stopped. Over the previous few years, ridership had been falling and Cap ReMap appears to have halted the hemorrhaging. It’s going to be a long road before Cap Metro can fully recover and eventually surpass the performance it boasted back in the late 2000’s, when Austin was much smaller. And it’s going to take much more than enhanced service. It’s going to take tough decisions from the city to grow in a way that favors transit (density, less parking).

Correction: Earlier I wrote that weekend ridership was declining. I was referring specifically to fixed routes, but I have since clarified to say that systemwide weekday ridership is “relatively stagnant.”

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The city’s terrible housing goals

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Throughout the conversation about the new land development code, there has been abundant talk of what the city must do to “meet our housing goals.” Much of that talk has come from the Council moderates, notably Mayor Steve Adler and CM Ann Kitchen.

“Housing goals” is often shorthand for the Austin Strategic Housing Blueprint, a plan adopted by City Council two years ago that sets a goal of of 135k new units between 2015-25 in the Austin metro area, 60k of which should be affordable to those at 80% area median income.

Where did 135k come from? Here’s the methodology:

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Therefore, 135,000 new units is not what we need to make things any better. It’s just what needs to be produced to keep up with population growth. It’s what we need to allow to maintain the status quo, where the urban core has become unaffordable and large swaths of the poor and working class are moving to the exurbs in search of affordable housing. This number of units will do nothing to make the city more affordable to those who have left the city or are considering doing so in the near future.

As far as I know nobody on Council has raised this issue. I’m eager to stand corrected.

Instead, what we see now is reform advocates on Council pushing for a code that achieves the Blueprint’s insufficient goals. They are facing resistance from neighborhood preservationists and hesitance from moderates.

 

But even if we are to make the dubious assumption that the Blueprint goal is adequate, it’s a mistake for 10-year goals to guide the housing capacity in a code anticipated to last 30 years. Julio Gonzalez at Keep Austin Wonky elaborates on what we need for the next 30 years:

A duration closer to 30 years – which is the age of the current code – seems much more reasonable. Even if you keep the conservative 13,500 units/year and 3x multiplier factors, that would increase the required capacity to 1,215,000 units.

In this context, even the most ambitious proposals being put forward on Council fall FAR short of providing the capacity necessary to house Austin’s future population.

Tomorrow Council will finalize its guidance to staff on the new code. Is it too late to sound the alarm on housing?

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The housing debate that isn’t happening

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How many units should be allowed on these lots on 38th 1/2 Street? 

Yesterday City Council had its first substantial conversation about the new land development code. Right out of the gate a couple of the key swing votes, notably Mayor Steve Adler, expressed reluctance to embrace some of the most ambitious reforms proposed: eliminating minimum parking requirements, allowing three units on every residential lot and allowing much more “missing middle” housing (house-scale multifamily) in neighborhoods that have traditionally been exclusively single-family.

What’s a little frustrating is how quickly self-proclaimed housing proponents are to close the door on mechanisms to create more housing. Adler said he wasn’t comfortable supporting triplexes on every lot, as Minneapolis recently did. He worried it would make things complicated and divisive. He also signaled that he thought the “missing middle” transition zones proposed by Greg Casar & Delia Garza went too far into single-family neighborhoods.

Nobody on Council, certainly nobody outside of the three-member preservationist bloc (Tovo, Pool, Alter), has said that preserving the architectural character of single-family neighborhoods is a top priority in the new LDC. Rather, they have all repeatedly stated that housing, affordability, and environmental sustainability are the top objectives. But what other justification besides neighborhood character is there for opposing these proposed policies to create more housing density?

What the housing advocates should do is ask staff to bring back an analysis of the housing capacity that the city needs to meet Council’s stated housing goals (135,000 units by 2027). The housing capacity refers to the maximum amount of housing that could be built based on the zoning. The actual housing produced will always be far less than the capacity. Wonky types say we need a housing capacity that is about 3-4x the total number of units we want to create.

(Now, I think it’s very likely that our housing goal itself is woefully insufficient to meet our needs, but that’s another conversation)

In addition to asking staff for a housing capacity calculation, Council can attach the additional constraint that two-thirds of the new capacity should be in the urban core, because otherwise staff might come back and just tell Council the city will meet its housing goal simply by continuing to build single-family sprawl in the outer reaches of town.

Staff could present several different scenarios for the capacity needed to meet the housing goals. One scenario might rely more on building up the corridors, while another might rely more on integrating more missing middle housing types throughout single-family neighborhoods. Or one might allow more intense missing-middle on the edges of neighborhoods (eight-unit buildings), while another might focus on allowing smaller scale missing middle (triplexes, fourplexes) everywhere.

Whatever staff comes back with, the burden would be on Council members to explain why they are opposing a plan that would provide the housing we so desperately need. Yes, the most fervent preservationists will oppose no matter what and simply say they don’t buy staff’s analysis. But it would be much harder for the moderates on the dais, notably Adler and Kitchen, to oppose what they’re being told is an empirically-crafted code to address our housing crisis.

Right now, we have the process backwards. CMs are proposing allowing more housing here or there, and others are saying they don’t want that; we need to create housing some other way. That type of debate often leads to no new housing.

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An urbanist code

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CodeNEXT offered very little compared to what the proposal from Jimmy Flannigan, Pio Renteria & Natasha Harper-Madison

For the first time in recent memory, City Council members are actually proposing an urbanist land development code. While at least seven (and then eight) Council members have signaled support for pushing our land use regs in a more urbanist direction (greater density, reduced parking), a proposal put forth by CMs Jimmy Flannigan, Pio Renteria and Natasha Harper-Madison seeks MAJOR change to urban planning in Austin.

In a post on the Council message board on Friday, the trio took a red pen to the code vision that Mayor Steve Adler submitted the previous week, transforming the document from a series of tepid reforms into a transformative code overhaul. This is the kind of stuff that urbanist activists have long talked about but that didn’t even enter the conversation during last year’s CodeNEXT debate.

Here are some of the most important points:

Eliminate minimum parking requirements. Whereas Adler suggested eliminating parking minimums in some areas, this trio said we should get rid of them citywide. Furthermore, they said the city should explore policies to discourage developers from adding excessive parking, such as parking maximums or counting parking spots against a project’s maximum Floor-to-Area Ratio (FAR).

(Potentially) Eliminate minimum lot sizes: Specifically, they said the city manager should present options for “eliminating minimum lot size and lot width.”

Triplexes on every lot: “The new code and map should allow at a minimum three units for all residential zoning categories.”

This is exactly what Minneapolis’ recently-approved comprehensive plan calls for. Currently, most of the single-family lots in Austin can be used for duplexes, while some only allow one unit. Developers have told me that the current code discourages the construction of duplexes over a large single-family home by requiring two parking spots for each unit and tens of thousands of dollars worth of fees for each unit. It’s key that the new code make it more attractive to build a triplex or duplex instead of a large, expensive SFH.

Much more missing middle housing: Whereas Adler’s directive on “missing middle housing” only specified legalizing accessory dwelling units (granny flats) throughout the city, this proposal says the new code should make a variety of “residential house-scale buildings, including single family, duplex, triplex, fourplex, and accessory dwelling units (ADUs)… to be permitted and more easily developed in all residential zones.”

3-4x housing capacity: The housing capacity is the maximum amount of housing that could be built under the zoning. The amount of housing that is built never meets the total capacity, which is why it’s critical that the capacity be much greater than the total number of units you hope to create. Adler said the housing capacity should be two or three times greater than the 135,000 new units that the Strategic Housing Blueprint says the city will need to add in the next decade. The Flannigan proposal says it should 3-4x at a minimum.

New housing should be prioritized in urban core: The proposal says 2/3 of new housing should be in the urban core, defined as the area bound by MoPac to the west, U.S. 183 to the north and east, and SH 71 to the south. Over the past 20 years the great majority of new housing in Austin has occurred outside of the core.

(Potentially) Eliminate Neighborhood Conservation Combining Districts: “Unique zoning districts (e.g., NCCDs) should be reevaluated in the current context of Austin’s housing and transportation needs, and any tools that are beneficial to said needs should be codified Citywide. Unique zoning districts should be mapped using the same planning principles as the rest of the City.”

NCCDs are special zoning districts that the city has implemented aimed at preventing new development in a handful of central neighborhoods: Hyde Park, North University, parts of Travis Heights, East 11th Street and East 12th Street. In some cases, the NCCD amounted to significant downzoning, rezoning multifamily properties in Hyde Park to single-family. That means that the existing apartment complex, if ever redeveloped, would have to become a single-family home.

So, is it going to happen? Is all of this going to pass? I’ll bet there are at least two other members of Council (Casar & Garza) who would endorse almost all of this. Next you need one of the following three: Adler, Kitchen or Ellis.

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