Council OKs more affordable housing funds

During last week’s State of Our City address, Mayor Steve Adler said it is projected that City Council will put $68.2 million into the city’s Housing Trust Fund over the next decade, not including funds from Pilot Knob. So where, exactly, is all that money coming from?

In a move that will more than double the amount of tax money going into affordable housing, Council voted to dedicate 100 percent of tax revenues being generated by property previously owned by the city to the city’s affordable housing trust fund. The Dec. 17 vote was 9-2, with Council Members Ellen Troxclair and Don Zimmerman voting no.

One example of such a former city property is the Green Water Treatment Plant redevelopment on Lady Bird Lake, which is slated to have 1.7 million square feet of new development – including offices, apartments and a hotel – when complete. Under a resolution approved by Council in 2000, the city has been transferring 40 percent of the revenue from former city properties to the affordable housing fund.

Council Member Greg Casar has pointed out that this one resolution will increase affordable housing money by more than what was approved in the 2013 housing bond election, $65 million, but without incurring any debt.

According to the city’s financial staff, transferring 40 percent of those tax revenues would have generated $1 million in 2017 and increased each year to $4 million in 2026. However, at 100 percent, the 2017 transfer would be $2.5 million. That amount would increase to $10 million in 2026. The cumulative total for the 40 percent transfer was estimated to be $27.3 million, but the cumulative transfer for 100 percent of the tax revenue is expected to be $68.2 million.

Council discussed at length where the housing money would be spent. Casar, who worked on the resolution with Council Member Pio Renteria, called the action “a really big step forward on funding affordable housing across the city.”

About 40 percent of the money generated by the properties will serve as a funding mechanism for rehabilitating housing and building new housing stock within homestead preservation districts. Another 20 percent will be used to provide affordable housing development in what are called “high-opportunity areas,” which are generally in higher-income neighborhoods and mostly on the west side. The final 40 percent will maintain the existing funding stream into the housing trust fund.

Currently there is only one are four homestead preservation districts. but with Casar and Renteria pushing, three more are on the way.

Council saw a district-by-district analysis of subsidized housing developments conducted by HousingWorks Austin. The results showed that Districts 1 and 3 have by far the most subsidized housing units. Council Member Ora Houston’s District 1 has 4,197 units in 103 different developments, and Renteria’s District 3 has 5,428 units in 69 developments. District 4, represented by Casar, is not far behind, with 3,564 units in 28 subsidized developments.

Districts 6, 8 and 10, on the west side of town, each have only three subsidized housing developments, with District 6 having the least number of units at 153.

District 10 Council Member Sheri Gallo pointed out that those three districts together had only 3 percent of the total subsidized housing units in the city. “And that to me says we really must address the desert of affordable housing options for our community, for our population in those areas. … Because we certainly have workers in that part of our community that are minimum-wage workers. In HousingWorks information, they also stated that District 10 shows that 40 percent of the workers currently living (there) are cost-burdened. Those are the ones that are already living in District 10. We haven’t even addressed the workers that work in District 10 that can’t even afford to live in District 10 and as a result spend the great majority of their time – and also their pocketbook – commuting back and forth.”

Gallo argued that the proposed allocation was inequitable. “And as a result, I just can’t support that. I can’t support a specific plan that doesn’t address more specifically being able to increase the affordable housing units in the area of Austin that right now only has 3 percent of the total affordable housing units in Austin. … I don’t think it’s a fair distribution of the money. … We are talking about taking a substantial portion of money that would go into our General Fund over the next 10 years and really targeting it to a use that would not be that flexible if we find that we need the money in future years for parks or for public safety or for human services.”

Renteria responded, “You know … it wasn’t by mistake. … It was designed.” By that, he meant Austin’s ethnic segregation was not by mistake. “It was because they didn’t want the minorities there (in West Austin). They didn’t want poor people over there. That’s what we’re trying to correct. … And let me tell you, if people here in District 6 really want low-income housing, I’m going to try my best to get as many low-income housing (units) in that district as I can.”

District 6’s representative, Zimmerman, has made it quite clear that he and his constituents do not want low-income housing. But Renteria has now publicly pledged to fix the low-income housing desert, as Gallo defined it, for Zimmerman’s district.

Houston abstained and Troxclair, Zimmerman and Gallo voted no on the vote to allocate 40 percent of the money within the Homestead Preservation Districts, 20 percent to what are called high-opportunity areas, and 40 percent simply to the affordable housing fund.

This story has been corrected to reflect the correct number of homestead preservation districts currently in Austin (four).

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