Adjustments to Policy Language Could Increase Austin's Affordable Housing, City Staff Say

Aug 2, 2016

City officials are looking at expanding a tool to bring more affordable housing to Austin neighborhoods.

That tool is called a “density bonus.” Here’s how it works: The city grants developers certain privileges, like building more housing units or taller buildings than are typically allowed. In return, the development must provide a public benefit, like adding some units designated to be rented at below-market rates.

On Monday, the City Council’s Housing and Community Development Committee approved a resolution to expand density bonuses.

“If there are clear changes that we can make that we know will help affordability in the city, given the crisis that we’re in, then I don’t think there are things that should slow us down to do so,” said District 4 Council member Greg Casar. “We can always agree and disagree about what those things might be.”

Density bonuses are already used in neighborhoods including downtown, East Riverside and near the UT campus. City staff say they’ve added more than 1,600 affordable units to Austin housing stock using the tool – but it can get confusing to implement.

Austin has lots of different policies on density bonuses. For example, there’s the fee-in-lieu option: Rather than providing affordable housing, developers can pay a fee that’s reinvested into affordable housing. But as far as the amount those developers are required to pay, city staff have said that the number is set arbitrarily.

In fact, said Council member Kathie Tovo, non-residential developers building downtown don’t pay anything at all.

“Currently, its fee is set at zero. I think that we should really revisit that because in some ways, we’re incentivizing non-residential development downtown at a time where we also want to see more residential development.”

City staff say clearing up the confusing language around these policies could make the fee-in-lieu option an easier tool to use, which could help encourage more affordable housing throughout Austin.

Below read more about the city's housing density bonus policy.