What's the Deal?

The Details in the City's Proposed Settlement With Stratus Properties Are the Fine Print in the Term Sheet.

Stratus Holdings in the Edwards Aquifer
Stratus Holdings in the Edwards Aquifer

Under the city's proposed settlement with Stratus Properties, the developer would agree to the following standards in building its residential and commercial developments across 4,000 acres in these Southwest Austin locations:

° Barton Creek Development

Stratus would build 750 single-family homes, 1,200 apartment units, and 1.71 million square feet of commercial space across a total of about 2,300 acres (shaded areas). For each of the 1,200 apartment units planned for "Section N," a large piece of land lying just north of Southwest Parkway, Stratus will contribute $100 to the city's Smart Housing Program, for a total contribution of $120,000. Overall, Stratus has agreed to more stringent restrictions on impervious cover than are actually required -- in today's favorable economic climate, chief executive Beau Armstrong explained, "You don't have to get as much density to get a favorable return for your investors."

Environmentalists say: The critical component here is Block N -- facing Southwest Parkway -- which has been at the top of developers' wish list for years. It is scheduled for intense development -- and a golf course. Stratus is requesting city wastewater services for this tract, without which the company will have to dispose of treated wastewater by irrigating the golf course. While the city staff wants the city to extend wastewater services so no wastewater is sprayed on the golf course, that would allow Stratus to list the golf course as "open space." If Stratus does build a golf course, environmentalists would prefer that the city monitor and control wastewater runoff at the golf course -- and separately designate a tract of open space as "open space."

° Lantana

Significant grandfathered entitlements exist on this property, where Stratus plans to build approximately 2,000 apartment units and 2.9 million square feet of commercial space over 452 acres. The developer would use SOS impervious cover levels on 270 acres while using a combination of two former ordinances -- the Composite Watershed and the Williamson Creek ordinances -- to develop the remaining 182 acres. Additionally, at least 20% of the multifamily development will be subject to the Smart Housing Program.

Environmentalists say: Lantana is an example of the harm the Legislature has done to environmental regulation in Austin. When the SOS ordinance was passed, it was assumed that commercially zoned property in Lantana would be developed in compliance with the SOS ordinance. House Bill 1704 allows developers to return to ordinances in place at the time the land was subdivided, thus escaping later environmental regulations. Stratus wants multifamily zoning and promises to comply with the SOS multifamily regs if it is granted. Here is a case where single-family land use that does not comply with SOS is a better alternative than multifamily in compliance with the SOS ordinance, considering the number of apartment residents and cars these large apartments will bring. As zoning power is its only lever in this section, the city should deal with zoning requests on a case-by-case basis.

° Circle C

Although Stratus bought 1,200 acres out of a Circle C bankruptcy nearly 10 years ago, the land has never turned much of a profit for them. Under the current proposal, the developer would move ahead on building 650 single-family homes, more than 1,000 apartment units, and 1.85 million square feet of commercial space.

Stratus has shown less interest in developing Circle C Ranch than in its other southwest properties, so they might be eager to talk about a trade here. The zoning Stratus is requesting would considerably increase the value of the property, were it to be offered in a trade for property at Robert Mueller Airport.

Environmentalists say: Why should the city grant a zoning request that drastically increases the value of the property that Stratus will likely offer in a "dollar-for-dollar" trade for property or development rights at Mueller Airport? Circle C offers the city the opportunity to use its zoning authority in a fiscally and environmentally sound fashion. When the city settled its Circle C litigation with Gary Bradley, it promised a master plan for development in the region before moving from interim to permanent zoning. Moreover, the city has not adequately addressed the issue of what these unbuilt projects mean in future traffic. The big environmental threat -- should the zoning be approved and the property developed instead of traded -- is the expansion of MoPac.

° Other Aspects

The city would settle a $14 million lawsuit with Stratus by reimbursing the company $6.3 million for infrastructure costs.

Stratus would grant the city an option to buy the 46-acre tract adjacent to the Nature Conservancy "at an agreed-upon price."

Stratus would provide public access to Barton Creek from public roadways at two locations, and will dedicate a public access easement for access along Barton Creek in Section L.

° The Complete Term Sheet

The term sheet for the proposed Stratus deal is available at the city Web site: www.ci.austin.tx.us/news/stratus.htm

What's the Deal?

° Public Hearings

Public hearings before the City Council are scheduled for 6pm Nov. 30 and Dec. 7. The Nov. 30 meeting is at Town Lake Center, 721 Barton Springs Rd. The Dec. 7 meeting returns to the Hancock Building at the Lower Colorado River Authority, 3700 Lake Austin Blvd.

The proposal is also being presented to various city boards and commissions. Presentations have already been made at the Planning Commission (Nov. 14) and the Environmental Board (Nov. 15). The issue will go before the Water/Wastewater Commission on Dec. 6 at 6pm. That Commission meets at Waller Creek Plaza, 625 E. 10th, Room 104.


Sections H&I: The Fazio II golf course area will have up to 25% impervious cover; development in the "peninsula" of Section H shall meet the water quality treatment standards of SOS.

Section N: Commercial development, which could include office, multifamily, resort/golf course, and retail development. The city of Austin "will provide sewer service to Section N ... thus eliminating the need for Stratus to build another wastewater treatment plant." The term sheet also includes considerable detail about drainage, retention ponds, and other water quality measures; this section composes about half of the entire term sheet.

POD 9: Will hold five single-family sites, developed at less than 4% impervious cover based on gross site area.

ABC West, Phase II: Code compliance

Section E & ABC Mid: Code compliance

Sections KLO: 17% impervious cover

Section M: 9% impervious cover

Lantana: 270 acres of multifamily, developed under SOS, and 20% of it subject to the City's Smart-Housing Program; 182 acres of single-family, developed under a hybrid of the Comprehensive Watersheds Ordinance and Williamson Creek Ordinances, "consistent with the arrangement approved by the City."

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