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Council Approves New Mixed-Use Development Rules and Launches Separate Corridor Proposal

Monday June 13th, 2022 by Jonathan Lee

In response to Austin’s housing crisis, the City Council passed two policies Thursday to allow more housing along main streets.

“I think it’s more critical now than ever to increase density and housing in these corridors,” Mayor Steve Adler said. “And I think that’s our existential challenge.”

Although housing advocates have called for more drastic changes, the Council has remained committed to adopting consensus policies following a court ruling over landlords’ right to protest rezonings.

The first set of changes apply to vertical mixed-use zoning, a density bonus program that relaxes certain development constraints in exchange for affordable units. Now developers can build even higher – up to 90 feet – if they offer more affordable housing.

The order, which takes effect immediately, divides VMU into two tiers. The first, VMU1, does not grant additional height but requires slightly more affordable housing – 10% of rental housing must be affordable for those earning 60% of the area’s median family income. The next level, VMU2, grants an additional 30 feet of height if the developers reserve either 12% of the units at 60% MFI or 10% of the units at 50% MFI.

Accessibility requirements have proven controversial. Council member Ann Kitchen, who sponsored the VMU changes, had pushed to demand more affordable units in VMU2, increasing the percentages to 15 and 12% instead of the staff recommendation of 10 and 12%. “I personally think we’re not pushing the envelope enough,” Kitchen said.

But others had concerns. “When we miscalibrate those numbers, we end up not building any projects at all,” said board member Paige Ellis.

The council initially voted 6-5 in favor of Kitchen’s affordability requirements, but in a moment of late-night drama council member Mackenzie Kelly changed her vote, tipping the majority in favor of the lower percentages. Council members Vanessa Fuentes, Kathie Tovo, Alison Alter and Leslie Pool joined Kitchen to push for increased accessibility.

It’s “hard to tell” whether the requirements are properly calibrated without financial modelling, said Erica Leak of the Department of Housing and Planning. To avoid moving forward with a calibration in the dark, staffers discussed creating a “streamlined and regular way to update layaway percentages and compensation calibrations”.

VMU2 projects on the Project Connect Orange and Blue light rail lines will have to make 15 or 12% of the units affordable. The higher requirement is offset by reduced compatibility and parking requirements along the lines, where VMU1 and 2 projects will only need to build 25% of the parking otherwise required by code, and where compatibility is not s will only apply within 100ft of the trigger properties versus the 540ft distance that typically applies.

To encourage affordable family-sized housing in VMU buildings, the number of bedrooms for affordable and market-priced housing must align.

Looming above the discussion was a March court ruling on landowners’ right to seek zoning changes and impose a 9-vote supermajority on Council.

Attorney Douglas Becker, who represented the plaintiffs in the lawsuit, threatened to sue the city again over changes to the VMU. “Changes to land use regulations on VMU properties without written notice or right to protest as required by state law and the District Court as confirmed by the Acuna et al. vs. City of Austinsubjects the city to further costly litigation,” Becker wrote in a letter.

Kitchen aimed to secure a right to protest by forcing VMU2 projects to go through individual rezoning, calling it a matter of “fundamental fairness and respect for the public”. Other members, however, argued that VMU2 should be de jure – meaning developers would not need additional Council permission to build. The Board voted 7-4, with Pool, Tovo, Kelly and Kitchen against, to make VMU2 as of right.

In a separate discussion, Council voted to initiate the process of reducing compatibility and parking requirements along busy city streets – a complex proposal that the austin monitor recently deep cover.

Council members say the regulations are hurting housing supply at a time when the city needs as much new housing as possible. Compatibility limits many sites throughout the city, making projects smaller or impractical, and parking requirements increase the cost of construction and, some say, foster car dependency when long-term plans for the city require less driving.

Under the proposed changes, compatibility would apply within 300 feet of a trigger property and the height limits of the rule would increase by 5 feet. Parking requirements would be reduced depending on the street category.

Many discussions are yet to come; the exact reductions in compatibility and parking requirements (and the streets where the reductions would apply) are far from settled. The resolution directs city employees to submit a draft ordinance for council’s consideration by September.

Photo by Rept0n1x, CC BY-SA 3.0, via Wikimedia Commons.

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