As part of the initiative, the City is building a comprehensive affordable housing program around the large-scale development of the Green Water Treatment Plant between Seaholm and the second street district. The program has two primary components. First, to ensure that at least 10% of units are affordable to households earning less than $42,000 for a 1-2 person family (80% of the area median income), the City is reducing land prices and requiring developers that developers who want to participate in the project include affordable housing units. Second, the city will dedicate 40% of property taxes generated by the project to a housing fund which will provide subsidies to make additional units affordable.
The City plans to choose a developer in June.
Here is a summary from the Statesman:
City leaders have urged developers to build more affordable housing downtown with little success. Now, Austin plans to put its money where its mouth is with the upcoming sale and redevelopment of the Green Water Treatment Plant and nearby Austin Energy property.Blunting the developers' argument that land and building costs downtown are just too high, city officials plan to give them no choice but to include low- to moderate-priced housing in the redevelopment of the nearly four city blocks and as a result almost certainly will make less on the land sale."We're not in the business of making money," Council Member Brewster McCracken said. "We're in business to achieve public values and goals."The city also plans to directly subsidize additional units for even lower-income families and dedicate 40 percent of the property taxes generated by the redevelopment project to its affordable housing fund."I just think it's an opportunity to have much of both worlds: a lot of tax base delivered, hopefully a significant measurable one-time capital gains in the land sale and then a series of other community goals," Mayor Will Wynn said.
Last week, the Task Force delivered its recommendations to the Austin City Council, Planning Commission and the Community Development Commission. After seven months of work and twenty meetings, the task force reached consensus on incentive policies to encourage developers to provide affordable housing.
Like most policies, there is a carrot and a stick. The carrot provides for expedited review, fee waivers, and zoning variances that allow for greater height or density if affordable units are included. The stick is a fee -- as much as $10 per SF -- that applies to project area in excess of standard zoning density requirements when variances are granted for projects that do not include affordable units. As the City Council has already been applying similar rules in some zoning discussions, the incentives seem likely to be put into effect.