Real Estate Council warns of potential land use code pitfalls

Members of the Real Estate Council of Austin believe their input was largely ignored when the city made its last major attempt at a Land Development Code revision under CodeNEXT. At a Land Development Code luncheon Wednesday, Geoffrey Tahuahua, the organization’s vice president of policy and government affairs, said that’s a big reason CodeNEXT ultimately failed. This time around, he said, the nonprofit hopes the city will pay closer attention.

Wednesday’s discussion touched on many of the real estate industry’s concerns, from how the city will transition from the old code to the new; whether land use and transportation planning will be sufficiently aligned to support a mass transit system; and whether it will be feasible for developers and owners to max out zoning entitlements to meet the city’s need for smaller, more affordable housing types.

As a developer, Megan Frey of Endeavor Real Estate Group said the answers to those questions hang on specific regulations from criteria manuals that are currently being written. Without knowing specifics such as how wide a driveway needs to be or how much water needs to be captured in a retention pond, she said developers are unable to evaluate the code’s potential.

Frey said the city needs to have criteria manuals published before the code is adopted in order to know the potential impact on housing. The manuals, she said, will ultimately determine how many units can be developed on a given lot. If City Council approves the code before that data is available, Frey warned that the city could potentially end up even worse off than it is now.

Tyler Stowell, an architect with STG Design, said the site plan approval process may also be a deal-breaker for small developers or owners who want to build “missing middle” housing types like triplexes or cottage courts. He argued in favor of offering a minimum guaranteed number of units or similar tool to prevent the city from dragging out site plan reviews for those much-needed smaller housing types.

Frey also took aim at the common conflicts between overlapping criteria manuals that sometimes hold up projects. “We face this in the current code a lot: A regulation in one section and a regulation in another don’t overlap well; they conflict. There is no written way in how to solve that.”

Instead of making developers “wrangle multiple people into a room” to ask for a waiver, she said the code should instead outline what to do when common conflicts arise, saving everyone time. Like the criteria manuals themselves, Frey said that process needs to be fully developed before code adoption.

“There is a way to solve it before the code is published; it just really needs to be a focus,” Frey said. “We need somebody to champion that at the city level to make sure that gets done in the best and most efficient way.”

The panel also discussed the need for clarity over grandfathering, another process-related issue. Real estate attorney Pam Madere of Jackson Walker said the details of grandfathering – allowing existing properties to remain in compliance based on current code – need to be thoroughly addressed in order to avoid an “incredible amount” of ongoing legal confusion.

“I have not yet seen anything that really speaks to how grandfathering is going to be handled,” Madere said. “I think it really serves the city and also landowners to have that statement be clear and included in the code.”

Stowell took a less urgent position, acknowledging that the code likely won’t be perfect upon adoption and instead asking for a commitment from Council and the code revision team to review the code regularly and make adjustments as needed. However, he agreed that a policy around grandfathering needs to be articulated up front in a way that doesn’t penalize developers or owners who may be on the tail end of a project when the new code is adopted.

Photo by the Washington State Department of Transportation made available through a Creative Commons license.

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