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Home > News > Final CodeNEXT Code Reading Draws Overflow Crowd, Lively Zoning Discussion

On June 29th, 16 days before initial comments were due on the Citywide Affordable Housing Density Bonus Program of CodeNEXT, about two dozen affordable housing advocates and others gathered at Guadalupe Neighborhood Development Corporation (GNDC) headquarters in Austin to discuss ways the new Land Development Code can be made more effective at creating affordable housing units.

HousingWorks Austin Executive Director Mandy De Mayo started the discussion by pointing out that the major components of CodeNEXT that are designed to create affordable housing units are the updates to the Density Bonus Program and the S.M.A.R.T. Housing Program. These programs offer incentives to the developers of multi-family structures such as increased entitlements or fee waivers in exchange for designating a certain number of units as affordable. De Mayo said, “The takeaway I got (from the previous Code Readings) regarding S.M.A.R.T. Housing was the incentives are not large enough. While they have increased the requirements, which is good as far as affordability to align with our City affordability requirements, the incentives that they’re providing in terms of permit fee waivers doesn’t even get us close to offsetting those costs.”

Most in attendance seemed to agree that increasing requirements for developers and not boosting incentives could have the effect of reducing participation from developers. Mark Rogers of GNDC said, “It (S.M.A.R.T. Housing) has to expand if we’re going to get the numbers (of affordable units) we need. We’re going to have to get into the market rate production builders who are doing the subdivisions with 100 or 140 units. That’s where the 10 percent of the units makes an impact. These incentives won’t do that,” said Rogers. Rogers suggested good incentives for developers could be “truly expedited permitting” at no cost or waiving all permitting fees.

The discussion then moved toward whether to allow developers more flexibility when they take part in the Density Bonus Program to incentivize participation. Ideas include allowing them to build their required affordable units in other parts of the city rather than as part of the structure they’re building, or in the immediate vicinity. Some fear that will create more economic segregation as developers will always opt to build those affordable units in less expensive parts of the city. Another idea is to add additional entitlements into the Density Bonus Program such as waivers for parking requirements and neighborhood compatibility.

Participants in the Code Reading also talked about whether the Density Bonus Program should allow developers to pay a fee-in-lieu into the City’s Housing Trust Fund rather than building affordable units. De Mayo said housing advocates have generally been opposed to the fee-in-lieu option, but she explained that participants in the previous Code Readings wondered whether we could create more affordable housing by increasing the fee or requiring that the developer work with affordable housing nonprofits such as Austin Habitat or Humanity, GNDC or Austin Community Design & Development Center (ACDDC). Nicole Joslin with ACDDC said “I think it’s important to have the affordable units being in our neighborhoods. I think it’s important that we have a variety of housing types that are affordable for different family types,” a belief which HousingWorks Austin shares.

Another concern about the Density Bonus Program is it’s unlikely to create larger affordable units suitable for families because allowing a greater number of allowable units without a significant increase in bonus will incentivize small units as developers will only meet the minimum requirements so they can use more square footage for their market rate units. Scott Turner with Riverside Homes said developers might create larger units if the program allowed them more square footage not just by building higher, but also building on a larger percentage of the property. This would require changes to impervious cover, compatibility and parking requirements in the draft code. Speaking of incentivizing affordability, Turner said, “That extra five feet may be the difference. That’s all sellable square feet.” Turner said, “It would be great if I could get eight town home style units in that box, with one affordable, instead of an efficiency in that box that’s affordable.”

Mark Rogers of GNDC said another way to incentivize developers to create larger affordable units through the Density Bonus Program is to scale the incentives according to the number of affordable bedrooms created rather than just the number of affordable units.

Toward the end of the discussion, participants expressed their concerns about whether CodeNEXT does enough to create affordable housing west of MoPAC. De Mayo pointed out that much of west Austin is dominated by single-family zoning. Scott Turner said that could be the result of the City honoring deed restrictions, which many neighborhoods in west Austin have. Stephanie Trinh, a board member for AURA, said she had concerns about the City reflecting deed restrictions in zoning requirements. Mark Rogers said it could be something the City is doing to avoid legal action from neighborhood groups and homeowners. Greg Anderson of Austin Habitat for Humanity further cautioned that if the City ignored deed restrictions it could trigger a wave of anti-CodeNEXT sentiment among homeowners.

Juliana Gonzalez of the Austin Tenants’ Council expressed concerns regarding the effectiveness of the density bonus program in dispersing affordable units throughout the city and the inability to meet the City’s fair housing commitments. She stressed the need to establish zoning codes that create affordable housing in all parts of the city. Eliza Platts-Mills with the UT Entrepreneurship and Community Development Law Clinic seemed to agree that not adding density options west of MOPAC could create Fair Housing issues.

After the Code Reading session, participants went their separate ways to begin drafting their comments and recommendations for the city on the first draft of CodeNEXT. You can read what HousingWorks submitted here.

 

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