Which Way to CodeNEXT?

In a few days (perhaps by the time you read this), the second draft of the CodeNEXT rewrite will be released (www.austintexas.gov/codenext). On September 7, the day following a preview of Draft 2 by city staff and consultants to City Council, we sat down with Mayor Pro Tem Kathie Tovo and District 4 Council Member Greg Casar, and invited a conversation about CodeNEXT, the direction of the land development code rewrite, and their hopes for the outcome of the process. We didn't have to ask many questions – beginning with their reactions to the rewrite, the council members exchanged views on their judgments, their intentions, and their differing perspectives on how much or how little the code can do to affect Austin's future. The following are excerpts from their discussion; the full version is available online. – N.B. and M.K.

Reaction to the Draft 2 Preview

Council Member Greg Casar: What folks really want to know is not just this individual zoning case but in this actual citywide rewrite … is what the citywide impacts – good, bad, or otherwise – are or could be. So I think it was really important for us to see that there is real work being done, to show how many more folks we can get near transit so we can have a better bus system, hopefully a real rail system. … Because ultimately for me, this whole process is really an important opportunity for us to change the course that we're on, because I think that most folks don't think the course that we're on is a good one, and to change it for the better.

Mayor Pro Tem Kathie Tovo: It does seem that there are some basic assumptions that haven't changed. One of them is that "market desirability" is continuing to shape the mapping, which I think is inappropriate. That was, I thought, an unfortunate continuation. We'll have to see, when the map comes out, and the actual text comes out, whether that is really prevalent throughout the maps, and the way things got mapped. … It does seem to me that we're still not looking at a code that is going to be mapping the corridors and the activity centers, which was part of the main intent of the whole process. If I'm right about that – and we won't know until next week – that's something of a disappointment.

Conflicting Narratives

There seem to be two regarding CodeNEXT and planning decisions generally: 1) that current code and policies are too restrictive … causing sprawl instead of the density that most people agree that we need, and reducing affordability by restricting housing supply; 2) the more we encourage density in existing neighborhoods, the more land costs go up, and the more we're forcing out existing residents, and the existing "small 'a'" affordable units are getting torn down to build much more expensive condos, and other units that aren't family-friendly.

Is there any way CodeNEXT can address both of those problems, or does it have to be one against the other? Conversely, could it instead become just a translation of current policy into a new, cleaner language that makes it easier to do the development work that they need to do, but it's policy-neutral?

KT: The expectation is certainly that the code would [make] the code cleaner, more consistent where it's internally raising contradictions, it would simplify them and try to bring it to a place where it's more easily understood. That was my understanding of what we were doing. It was also my understanding of what we were doing, that it would take Imagine Austin [the city's adopted 2012 comprehensive plan] and project that out across the city – which is largely looking at our corridors and activity centers. And part of Imagine Austin was to append all those neighborhood plans and kind of follow those along. To me, it's diverged much from that original intent.

There's very little we can do to intervene in a market that's driving up housing costs, and I think it's foolish to promise that our land development code is going to suddenly create lower land values. It just isn't. But I think we can absolutely exacerbate and accelerate a system of displacement, if we go in and start up-zoning people's properties in dramatic ways. … There are other consequences of that; one of them is that we're not just replacing the housing with higher-cost housing, we're replacing it, likely, with smaller units. Those are very unlikely to house families with children, and that's been a longtime trend with this city – that families with kids are moving out of the central city.

GC: It's low-income folks and moderate-income folks that are being hit the hardest by the housing crisis in our community and in the city, and other cities are experiencing similar market forces all over the country. When you talk about the "two narratives," I sort of feel like an orphan – I don't feel like I or many of my colleagues easily fit or live in either of those two narrative worlds. Of course we want to help people who are struggling with these issues now, and all policy changes have pros and cons all across the city, for different people. My focus has been knowing we can't just do the development code changes and expect to help with this issue. We have a really broad area of concern, and a much smaller area of control. …

There are areas we can help with this, and the land development code has to be one. I want to work on this in such a way, so that in 10, or 15, or 20 years, [we] have a chance of being a more economically integrated place than we are right now – to even have that opportunity.

Combating Market Forces

GC: What can create opportunities for us to be more economically integrated? That means not just a supply of more market-rate housing, but also a greater supply of income-restricted housing, greater funding streams, hopefully, in things like TIFs [tax increment financing] for more publicly subsidized housing, and more public housing. I think we need more of all of those things, and to think about economic equity as we do that. Because even if there is housing capacity, in some of our higher opportunity neighborhoods, what I'm interested in … is not just what the housing capacity is, but what will actually happen, what will actually get built. …

We want to see what will change. For me, I think we have to change from the current path, on to something better. Not just on affordability and integration – but I think that's really critical – but also continuing to think about our environment, continuing to think about how we get a better bus system and hopefully a rail system – and those things are really tied into the land development code. Passing a land development code doesn't build bus stops, but it helps.

Unintended Consequences

KT: You talked about opportunities outside the land development code, and I think that's where actually we're going to have more success in creating housing that is actually affordable for people. I don't believe, as I said, that up-zoning lots of properties is actually going to create affordable housing. The ADU [accessory dwelling unit or "granny flat"] discussion may be instructive here. …

We had an opportunity to place some kind of income restrictions on it, and did not; we also had an opportunity to do something to encourage the preservation of that existing house. … But anecdotally, what I've heard from several people over the last couple of weeks … is not just people adding an ADU in the back of their property. You see people scraping the existing structure and building two structures, and because we increased the size [allowed], that's a more economically feasible opportunity now, and they're condo-ing each of the structures. … That's not to say that we shouldn't have moved in that direction, just that we need to proceed very carefully and have a really good analysis before we adopt big changes in our code.

GC: I would just say that we still have on the books the opportunity for income-restricting an ADU. It was never utilized, except by nonprofits who were already naturally doing some of that. I think in this code rewrite we have a real opportunity to set that up in a way that works. I think we should have missing-middle housing types, because experience here and across the country shows that attached housing is cheaper than detached housing, when you compare apples to apples. Brand-new attached housing isn't going to be cheaper than some really old housing in a lower-cost part of town, but the fact of the matter is attached housing in an apples-to-apples comparison is cheaper, and we need to figure how to get that on the ground, appropriately, if we're thinking about how to give ourselves a chance in the future.

But the market is not going to produce 50 percent MFI [median family income] or 60 percent MFI units in high-opportunity areas. It's just not going to do that. I don't believe that some guy in a bank in Sweden wants that to happen.

Missed Opportunities

KT: Let me mention some of the other opportunities that have sort of come and gone through our Council. We have very few tools – very few tools – here in Texas, to promote affordable housing. When we do something like Plaza Saltillo, where there was an absolute commitment, quite documented, for 25 percent affordable housing, and then we have a shift in that [to 15% at time of Council approval] – we need to push back as a Council. We need to push back. Then we were told that requiring 12 of those units to be family-friendly was going to kill the deal.

A couple of weeks ago, we had the Habitat for Humanity discussion, and there was pushback about a line in there that a majority of those units be family-friendly. We have to use the opportunities we have; we just have to do better about that. Certainly I think we agree on the affordable housing bonds; I think we need to use that as an opportunity to create affordable housing. And we need to mandate on-site affordability. That's not something our current code does, and that's not something that's proposed in the draft before us.

Some of the comments I submitted to the staff as part of the affordable housing and density bonus, two main things: one is, we absolutely should require on-site affordability, and if you can't create that affordable housing there on that site, then there ought to be an exception process that you have to come to Council for a decision. It ought to be a public conversation, about why that's not possible, or feasible for that project. Because that is the way we're going to get housing, in different parts of town, that is income-restricted. The other is using city-owned lands. … I don't believe we should have a code before us that is increasing entitlements without having some kind of community benefits attached.

GC: I think we need to make the best deal for affordable housing that we can make. … We need to get the most income-restricted units to the people who need them the most, and in the best parts of town that we can get them in. …

So I think we should be achieving affordable units where we can, and especially I'm interested in the 60 percent [MFIs] and below units. I want to achieve economic integration, and maybe that means putting them in the same building, maybe that means having a building that's on some public lands getting financed and funded so that we can have 50-50 buildings. I want buildings where low-income folks, who are lower-powered economically also, will have the opportunity and ability to live.

KT: I think if we want to create affordable units in different parts of town, at some point we have to stop letting people pay into a fee-in-lieu [that is, into an affordable housing fund instead of creating on-site affordable units]. It's never enough money to create the housing, and it's not going to create it – almost never – in that same neighborhood, and allow those families to access the resources of those high-opportunity areas. … There's always going to be a pushback – "We need more calibration," "It's going to kill the project," or "People will opt not to do those extra three floors" – it's just the same argument rehashed over and over and over again. At some point we just have to say, "We're serious about this."

GC: And the question on the money is … can we use that money to leverage more money to be able to produce the units? For me, I like the idea of having units in the skyscraper, if the options are having units in the skyscraper vs. a small pittance of money. But I think that a lot of families would prefer to live in some missing-middle housing or an apartment complex near their school, rather than in the skyscraper. … But if, in the end, we can get affordable units that folks really want to live in, especially families that need the most help – then there's a real decision-point to be made there, and that's not the place where we're having the conversation right now.

In the end, the goal should be to pass something where we have a reasonable expectation – not because we agree with market forces – but a reasonable expectation that we are pushing on market forces that wouldn't otherwise do this, to produce both the market-rate housing units that we need, and as many income-restricted units at lower levels of MFI as we can get. And that likely isn't just the land development code, but having to pass a land development code with the right density bonus programs, with the right set-asides of money to buy down units, and do all of that work, and have public land that is actually available.

"Intoxication About the Numbers"

KT: I think we have a couple of striking examples in Austin that we need to be mindful of. One is the East Riverside corridor. We went through and rezoned that whole area; there were some significant entitlements built into that rezoning – lessening of compatibilities and I think some increased height – and a density bonus program on top of that. A lot of the new development that is coming online … [has] displaced thousands of Austin families from that area of town. And even when you have developers who are accessing the density bonus program, you've got families at 80 percent MFI, where once you had families that were making 60 percent sometimes 30 percent MFI.

So this notion of creating eight units on what was once a single-family tract is going to be the answer to affordability, or is going to create affordable housing, is problematic. Number one, that housing is not going to be cheaper – and at what cost? I look at this, and there's a sense of intoxication about the numbers: How many units are we going to create? I would say to you, if you look at the other capacity studies – if all you're interested in is units, you can look and see, we already have the ability to have that number of units. Let's look at how and why it can happen organically. Or are there tweaks we can make to the ADU ordinance, or some of the other things that allow for that density to happen in coexistence with the structures, and the people, and the families who are already living in those communities? So we don't have the East Riverside planning exercise writ large, and so many thousands of families are displaced.

Existing Affordable Housing

KT: How can we really address the question of the aging multifamily stock? We have something like 60,000 affordable units in this city that are not subsidized. If you look at where the opportunity is for affordable housing, that is where the opportunity is. We have talked for a long time about a "strike fund"; the mayor is working on one from private sources. There is no reason we can't step up our efforts as a city to really get proactive in doing that. A portion of new bond funds, when we go out for bonds, should be allocated to the purchase of, or for the support of, property owners who want to hang on to their housing but need to be upgraded. We certainly don't want people living in substandard housing, but we need to be creative in the way we reach out to those property owners and allow them to upgrade their property, because often it's when their property is degraded that they're more likely to sell and have it redeveloped.

GC: So many of the families that are living in District 4, and also northeast, District 1 – that's where you have schools being built and they're already planning to build new ones – figuring out how we can discourage replacing old multifamily with newer, more expensive multifamily is critical. Even if we can't mandate that in the land development code, we should set up as many disincentives to doing that as we can. The wholesale demolition of them is not good, and also just the up-filtering of rents and the displacement of those families also needs to be slowed. Creating opportunities for folks – some of these apartments are located in places where, if there are not lots of options for people to live even closer to the Downtown core, eventually speculators will realize this is the next best place to locate higher-income earners. …

The Right Level of Entitlements

KT: I think we both share an interest in helping people stay within their neighborhoods, whether they're people in your district or people in mine. The divergence here may be that you seem to be suggesting that up-zoning central neighborhoods helps stave off the pressures on your neighborhoods. I see that those rising property values of those central neighborhoods are going to drive Central and Central East Austinites further out. It will create, as I said, those rings of displacement. I think a strategy of displacement, whatever neighborhoods we're talking about, is not one we should take as a city. I think that's the kind of [draft] code that we have in front of us right now.

GC: We should make it less economically attractive to tear down old multifamily [housing]. I agree with that. … But there are lots of little houses that used to be $50,000, and then they were $150,000, and then they were $450,000, and now they're $700,000. That's the current trend, the current path that we're on, so I'm working on trying to find ways that we can make that issue better. How can we address the fact that whether it's torn down, or just remodeled, or added on to, those buildings are getting more expensive. The same thing can happen to our multifamily housing stock. I don't want to incentivize it being torn down, but I also don't want to incentivize the rents going up because that is the next closest apartment building that hasn't gentrified yet. …

We could take the example of a house being scraped and all of a sudden you have four units. My preference would be for us to figure out how we can get an income-restricted unit along with the market-rate units. I think we need both: a higher supply of income-restricted and non-income-restricted. The challenge is, if we stay on the current path in which, of the 2,800 single-family demolitions, 2,100 of them is just a bigger single-family house, how is that addressing the problem, in and of itself? What are we doing now? How is our current land development code helping with that? …

But paralysis, and sticking with what we've got right now, seems like a pretty bad option. Can we make things worse? Yeah. Can we make things better? That's what we were elected to try to do. …

Is the Code Rewrite Moving in the Right Direction?

KT: What's interesting to me about this conversation is that there seems to be a lot of interest in increasing the density in Central Austin and Central East Austin, when they already have the highest density of every district, Greg, with the exception of yours. And if you look at individual neighborhoods, there are high degrees of missing-middle housing. It's never clear to me: We use that term without defining it – are we talking about the form of the housing, or are we talking about the people? But we have both in Central Austin. We have multifamily, coexisting with single-family, coexisting with single-family that's been converted into multi-units. When you have that mix already occurring in neighborhoods, why go in and change the zoning in such a way that it's going to potentially increase displacement? … When we're talking about increasing the net of our units by something like 3,000, and you're deep in the interior of the neighborhood trying to seek those units – it doesn't seem to me the best strategy, both in terms of the number of units that you're trying to create, as well as the loss of social cohesion and existing residents.

Going Forward

GC: On this issue, that can get so heated, I really want to be able to model the conversation … that this is the kind of conversation that is going to be not only really critical for the city, but it's a long-term project, and it can bring some incremental change, depending what sort of decisions we make. … But it's been hard, sometimes, to model that conversation and get out of just the debate on an individual issue, until we can get this better picture, which I think is starting to come. I think that we can have that conversation, and get people out of their camps a little bit more, and model a conversation around what kind of vision we have for the city. Of course we need to go into the localized context as well: Did you do this one right or wrong in this neighborhood? We need to do that, too. But having a whole land development code rewrite, and having the opportunity to shift some of the direction of the city is a critical opportunity to make this not like another zoning case, and instead, talk about higher-level, rational, policy-making decisions. …

Affordability doesn't win above all things. It's critical, but we also have to protect the environment, and we have to have air that we can breathe, and Barton Springs is obviously critical in this community, and we have to think about our infrastructure. … There's all this other stuff there too. If affordability ranked above all, maybe we'd have a very different set of regulations. So we have to be working on affordability and integration, but we have to be thinking about these other things, too.

KT: Certainly it's absolutely true that zoning and land use has absolutely been a tool of racial segregation in this city. When we're talking about land use changes, that is absolutely something we need to confront. Do I believe that the land use code is going to reverse or mitigate that history? I think we're limited in terms of what the land use code can do. We have to do everything we can to promote integration – economic integration, racial integration – absolutely. …

And there's probably unanimity [on the dais] that displacement is a bad thing. I think we have different notions of what may or may not cause that, and that's where we need to focus our efforts. … We really have to have more discussions about what really is the best path moving forward for the city as a whole, but also with the real intent of keeping people in their neighborhoods, and keeping those neighborhoods as intact as possible.

But because of that history of racial segregation, and the city turning its back on certain parts of our community – including and especially East Austin – has kept the city from intervening in acts of major gentrification and displacement in our African-American community. We need to learn from that experience and make sure that we're committed to better decisions.

Can You Get a Unanimous Council Vote to Approve?

GC: I don't know. … Now? No, not now.

KT: I think there's a path to a unanimous vote to adopt this code, but it's going to have to be a different product than what's in front of us. … At this point, absolutely not.

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CodeNEXT Calendar

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CodeNEXT at City Hall

Fri., Sept. 15: Draft 2 released.

Tue., Sept. 19: Joint meeting of the Planning and Zoning & Platting commissions, debriefing Draft 2 with CodeNEXT staff and consultants. City Hall, 7pm.

Wed., Sept. 20: CodeNEXT Counicl preview meeting, also broadcast on ATXN. 1-4:30pm.

Tue., Oct. 3: Joint meeting of the Planning and Zoning & Platting commissions. 7pm.

Wed., Oct. 4: Environmental Commission review.

Wed., Oct. 18: Historic Landmark Commission review.

Tue., Oct. 24: Joint meeting of the Planning and Zoning & Platting commissions.

Tue., Oct. 31: Public engagement on Draft 2 ends.

Tue., Nov. 7: Joint meeting of the Planning and Zoning & Platting commissions.

The Road Ahead

Tue., Nov. 28: Draft 3 released.

Tue., Nov. 28: Joint meeting of the Planning and Zoning & Platting Commissions.

Tue., Dec. 12: Land use commissions review Draft 3.

Tue., Dec. 19: Land use commissions review Draft 3.

Thu., Jan. 11, 2018: Land use commissions review and take action on Draft 3.

Fri., Jan. 26: Draft 3, annotated with land use commission action, posted to Council agenda.

Thu., Feb. 8: Council reviews Draft 3 with recommendations from land use commissions.

April 2018: Council takes final vote on CodeNEXT.

Open Houses

Sat., Sept. 30: Anderson High School (8403 Mesa). 10am-noon.

Mon., Oct. 2: Conley-Guerrero Senior Activity Center (808 Nile). 6-8pm.

Mon., Oct. 9: Crockett High School (5601 Manchaca Rd.). 6-8pm.

Wed., Oct. 11: Hart Elementary School (8301 Furness). 6-8pm.

Mon., Oct. 16: Austin High School (1715 W. Cesar Chavez). 6-8pm.

Wed., Oct. 28: Dove Springs Rec. Center (5801 Ainez). For Spanish speakers. CodeNEXT staff plan to provide transportation options for non-Southside residents. 10am-noon.

Community Events

Sat., Sept. 16: CodeNEXT Draft 2.0 Reading Party presented by AURA and Friends of Austin Neighborhoods. RSVP for Club Room access: www.fb.com/events/138922619959127. Echo Apartments, Club Room, 4527 N. Lamar, 4-8pm.

Tue., Sept. 19: Talk Density to Me Happy hour to discuss the pros of greater density, then walk to City Hall together and attend that night's joint meeting of the Planning and Zoning & Platting commissions. RSVP: www.fb.com/events/348088998973907. The Ginger Man, 301 Lavaca. 5-6:30pm.

Wed., Sept. 20: Hancock Neighborhood Assoc. meeting Mayor Steve Adler will discuss the latest draft of CodeNEXT. Hancock Rec. Center, 811 E. 41st, 6:30pm. – Sarah Marloff