Austin Contrarian

Red Bird Lane

This isn't CWS versus Save Town Lake, but it does exemplify what is wrong with  Austin's zoning process.

Developers Leslie Moore and Magdalena Rood want the city to rezone a one-half acre lot near Stassney and South Congress from SF-2 to SF-3.  (Moore and Rood redeveloped the small cottages across from the Texas School for the Deaf into the eclectic shopping area there now.)

This shouldn't be controversial.  Almost all of the single-family properties in the area are zoned SF-3.  SF-3, in fact, is the predominant single-family district in Austin.  This neighborhood is fairly central these days -- a little over one mile south of Ben White.  The area is close to three major arterials and several bus stops.  It is a natural place for denser development.

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But the neighbors are having none of it.  SF-3 allows minimum lot sizes of 5,750 sf for single-family homes rather than SF-2's 10,000 sf minimum.  Even worse (from the neighbors' perspective), SF-3 allows duplexes.  The neighbors object to the upzoning because it would allow Moore and Rood to subdivde the property into three lots and build as many as five units (two duplexes and one single-family home).  They object even though there is a duplex next door and a duplex across the street.

They cite that old standby, "neighborhood character."  Go with what's worked elsewhere, I guess.  But In Fact Daily's coverage (gated) suggests they're worried about something else:

“We met with some of our neighbors and listened to their objections. The things that they were concerned about were things like not wanting to have renters in the neighborhood. They want people who are going to be homeowners in the neighborhood,” Moore said. “Well, I don’t think there’s ever been anyone of us who can guarantee that that’s going to happen, and, besides that, I think that there’s a lot of us out there who are renters, and there’s nothing wrong with that.”

Homeowner Andrea McCartney, speaking on behalf of her neighbors, said her neighbors did not oppose growth as long as it was controlled growth. In this case, the lot was located on a block in her neighborhood where duplexes and condominiums have stayed on the market for months.

The Planning Commission has already approved the rezoning.  The case came before City Council on June 18, but it apparently is so controversial, so contentious, that Council postponed it to July 23 so the neighbors and Moore can continue to negotiate (despite the apparent impasse).  And, because the neighbors have filed a valid petition in opposition, approval will take a Council super-majority.

And so we are handed a nice illustration of all that is wrong with zoning in Austin:

1. Systematic under-zoning.  Our zoning districts are gerrymandered, sometimes block by block.  This allows each district to be zoned for the least intensive use compatible with the surrounding uses.  Larger districts require more intensive zoning in order to accommodate a broader range of uses.  For example, the city had to carve out this tiny, six-block "neighborhood" in order to give it SF-2 zoning; a larger district would have required the city to stick to the SF-3 zoning in the surrounding neighborhoods.

2. Neighborhood groups that exploit zoning regulations for improper purposes.  Zoning was not intended to regulate a neighborhood's mix of renters and homeowners.

3. A zoning process that dissipates enormous resources on every trifling dispute.  By the time this is over, this one single-family lot will have consumed a ot of Planning Commission and City Council time, not to mention the time of city staff and the property owners themselves.

4. A zoning process that gives undue weight to neighborhood objections.  Because the neighbors have filed a valid petition, simply changing this parcel from  one single-family classification to another will require a Council super-majority.

Austin is growing.  All central neighborhoods face -- and will continue to face --nearly constant development pressure.  Our goal should be to help our neighborhoods gracefully transition to denser, more urban places.  Our zoning regime does the opposite, though.  It encourages neighborhoods to object to every upzoning, no matter how flimsy the pretext.  Council approves upzonings in a scattershot manner, embittering one side or the other.  We're left with gerrymandered districts that are themselves pockmarked with stifling overlays, covenants and spot zonings.  And the property owners are guaranteed another trip to Council whenever they want to change the use.

No finish line

Most of the recent discussion of the outdoor music venue ordinances by me and others has focused on the obstacles they set for restaurants like Shady Grove.  But the ordinances' more long-lasting impact will be the change to the permitting process. 

Before the new ordinances were enacted, eligible venues were entitled to an outdoor music venue permit as a matter of right.  Outdoor music venues must now obtain the discretionary approval of a city functionary.  The ordinance directs the city official to consider factors such as neighbor complaints, proximity to other uses and noise mitigation efforts.  Neighbors and neighborhood associations are entitled to notice and the chance to voice their opinions.  Every existing outdoor music venue will have to run this gauntlet when it seeks its next permit renewal.

But, perhaps more importantly, every outdoor music venue will have to run this gauntlet every year.  The new ordinance does not grant venues an automatic renewal.  A venue will need a discretionary permit in year one, year two and year 20.  There is no finish line it can cross to declare victory. 

Theoretically, a music venue could obtain a permit renewal for five years straight but, thanks to continuing neighborhood pressure, be refused a permit in year six.  Nothing necessarily would have to change:  it might play the same kind of music, to the same crowds, during the same hours, with no violations of the decibel limits.

Now, I hope city staff will administer this thing consistently.  It should allow outdoor music venues that receive a permit in year one to receive a more or less automatic renewal in later years unless it violates the noise limits or there is some significant change in the neighborhood.  But no matter what city staff does, the permitting process is now an intrinsically political one.  Venues which draw opposition in year one will, more than likely, draw opposition in years two, three and four.

A likely (and perhaps intended) consequence of this ordinance will be to deter applications for new venues.  Making the up-front investment will be less attractive if the venue's right to operate will require annual, discretionary (and intrincially political) approval.

Update and clarification on the music ordinance

I think I got the basic analysis of the outdoor music venue ordinance right.  But a couple of issues deserve more discussion.

First, I pointed out that unless a property is zoned for cocktail lounge, a restaurant will have to apply to rezone the property to switch its classification to a cocktail lounge. Cocktail lounges are allowed (conditionally) in CS-1 districts, which are rare, but they are also allowed in the CBD and DMU districts. These include both downtown and most of Barton Springs (including Shady Grove). I didn't mention the CBD or DMU districts before.   Shady Grove will not have to seek a rezoning because it is zoned DMU.  Restaurants along South Lamar, South Congress and other streets not within these three districts will need to seek rezonings.

But, second, the cocktail lounge reclassification will itself be more onerous than I indicated.   The Chronicle (h/t M1EK), on April 24 and again today, points out the cocktail lounges are conditional uses in CS-1, DMU and CBD districts. This is a big deal, since restaurants will now have to go through the conditional-use permitting process, including a trip to the Planning Commission. Furthermore, I believe they will have to submit site plans and comply with all code requirements enacted since they obtained their initial use permits, including parking, compatibility, setbacks, etc.   This may be an insurmountable hurdle for venues that have been around for 20 or 30 years.  Rather than being a minor, administrative matter, a reclassification will be time-consuming, expensive and fraught with uncertainty.

Finally, as I pointed out, it is not at all clear that these restaurants even meet the definition of a cocktail lounge.  The sale of alcohol for on-premises consumption is an accessory use for a restaurant.  It is a principal use for cocktail lounges.  Can city staff reclassify alcohol sales from accessory to principal use without any change in the mix of food and alcohol sales?

When I posed this question to Jeff Jack on the ANC listserve, he replied, "I suspect that what we will see is, at least in this case, is the interpretation by staff allowing food sales, no matter how much of a percentage of the total sales, to be an accessory use to a cocktail lounge. this only makes since selling more food at a bar is a good thing from the perspective of limiting alcohol abuse and it's related problems for which the code distinction was created."

City staff may be pressured to adopt this interpretation.  If it does not, then restaurants will have an incentive to push alcohol sales and curb food sales -- which would certainly be an unintended and harmful consequence of the new ordinances.  I don't know have far staff can go with this, since it has to worry about the consistency of its treatment of "accessory use" with other uses.  In other words, if it treats food sales as an accessory use even though they comprise 80% of gross revenue, it might have to liberalize its definition of accessory use for other, unrelated uses.

As I said before, this last issue is a murky one.  We won't really know the answer until staff tells us. 

Restaurants and cocktail lounges and the noise ordinance

The new noise ordinance isn't really my issue.  I didn't follow it as it wended its way from task force to Council.  Others have (see here, here and here).

But the controversy over Shady Grove finally motivated me to read the ordinances myself.  I've put my thoughts below.

Let me stress that I've had no prior experience with these ordinances.  I don't know how city staff has interpreted the noise ordinance in the past or how they're interpreting the new ordinances.  And I could have missed some relevant code provisions.  In other words, I've strayed outside my area of expertise.  Proceed at your own risk.

If anyone spots a mistake below, please let me know and I will cheerfully correct my analysis.

Council exempts PUDs from Lady Bird height limits

City Council tentatively approved height limits for Lady Bird Lake Thursday night. Very tentatively: it approved the ordinance on first reading only, required courtesy notice to all affected property owners before second reading, and kept the public hearing open.  A couple councilmembers said the ordinance needs more work. The ordinance thus might change significantly before final approval.

Somewhat surprisingly, Council exempted planned unit developments (PUDs) from the ordinance.  The Planning Commission had recommended the exemption two nights earlier, but its recommendations seem to have little pull with Council for whatever reason. 

PUDs allow the city and developer to customize zoning and other land-use regulations for a specific site.  Typically, a developer asks for greater density or height or mixed-uses in return for providing public benefits and giving the city a say in design.  Council essentially adopted a "hard" height limit except for projects over which it would retain significant control.  It thus left itself the option of incentivizing developments that provide green space or trail access for the public.

There is a lot to dislike about the ordinance on the table.  It imposes hard height limits without working out the system of bonus incentives, which are important for developments that won't or can't go through the PUD process.  And the height limits in some of the subdistricts are unreasonable.  

But this ordinance is better than the alternative pushed by Save Town Lake.  A lot better.  If you want proof, just consider STL's reaction:

Jeff Jack, a director of Save Town Lake, a citizens activist group formed in 2006 to fight what it sees as overdevelopment along the lake, said the council did not do much to demonstrate its values. He said the limits should be absolute. Dense development, he said, can go elsewhere in town.

"This (council vote) leaves the door open," Jack said. "It doesn't solve our problem."

Since STL seems to care more about limiting height than restoring green space along the trail, its disappointment is reassuring.

The City's Comprehensive Housing Market Survey

In the fall of 2008, the City Council, concerned about the lack of affordable housing in the city, commissioned a comprehensive housing market study from BBC Research & Consulting.  BBC presented its final report to Council in March.  (H/t Katherine Gregor.)

I haven't had time to work through the entire 142-page report.  I disagree with some of what I've read, but there is much here to like -- and much that echoes this blog's themes.

BBC's very first recommendation is that the city "reevaluate the zoning and development process."  BBC recognizes that part of the problem is the role played by neighborhood groups and part of the problem is the lack of density; not surprisingly, these are linked:

Austin’s current process of evaluating applications for residential development is community based. The city’s zoning and land use regulations also reflect the city’s dedication to environmental preservation and commitment to smart growth.

These principles are part of what makes Austin a great city. However, they can conflict with providing affordable housing for residents and workforce.  In desirable areas where there is much demand for housing, anything that constrains the supply leads to increased housing costs.

We have identified several opportunities for the city to modernize its current development process that will reduce the barriers to affordable housing development in Austin.  These include:

• Reconsider the role that many neighborhoods groups are playing in development decisions.
• Develop a strong, citywide Comprehensive Plan that guides development and forms the basis for the acceptance or denial of development applications.
• Increase density by approving dense developments that offer opportunities for affordable, attached housing products.
• Educate residents about the need for workforce housing in Austin and the consequences of not meeting current and future needs for housing.

(Italics mine.)

And more on neighborhood groups and density two pages later:

The city’s current neighborhood-based planning process does very little to facilitate the development of affordable housing on a citywide basis. Some of the neighborhood plans have affordable housing as a goal; others do not. We were also told many times in our focus groups with more than 100 stakeholders that Austin has lost many affordable units to neighborhood resistance.

Austin is not unusual in this regard. Residents in every city and town are notoriously resistant to density, and the more affordable the project and the greater the density, the higher the resistance. Neighborhoods often forget that a desirable city will grow; they cannot stop this momentum. Restricting workers from obtaining housing in an area does not mean these workers will go away— they may live farther away, but they still need to drive to work. Growth limits almost always lead to increased traffic congestion and the leapfrog effect of affordable housing being pushed farther and farther from employment centers.

Neighborhoods often use declining property values as successful arguments to fight affordable housing developments. Many academic studies have adeptly demonstrated that the effect of density and affordable developments on property values is not negative.

As I said, there is a lot more to this study, and it flags other problems with Austin's housing market.  I intend to cover some of the other points after I've finished working through the study.  But it's good to see the city hired consultants willing to provide a clear-eyed assessment of the city's problems.

Height limits protect; incentive bonuses restore

I expect the Austin City Council tomorrow to adopt "new" height limits for the Lady Bird Lake Waterfront Overlay.   The "new" limits are actually those adopted in a 1986 ordinance but eliminated in a 1999 rewrite of the code.

The height limits were the subject of ferocious (and, in my opinion, often misleading) debate during the battle over CWS's proposed development on Riverside Drive. Prodded by Save Town Lake, Council appointed a Waterfront Overlay Task Force to revisit the height limits after the battle had crested.

The Waterfront Overlay Task Force has recommended that Council adopt (or restore) the 1986 limits.

I quibble with some of the height limits. They are too restrictive for some subdistricts given the development over the last quarter century or so.

But my main concern is the one raised by the Task Force's minority report   (pdf): the Task Force has recommended that Council restore the height limits without addressing the incentive bonuses provided by the 1986 ordinance.  

The 1986 ordinance included a well-defined set of bonuses.  Developers could earn additional height or FAR by providing public benefits, such as public access to the hike-and-bike trail, dedicated easements or pedestrian-oriented uses.  These bonuses could not be used to exceed the WO height restrictions.  But they could be used to exceed -- as a matter of right -- the rather arbitrary height limits of base zoning districts (e.g., 35 feet for Neighborhood Office Districts, 40 feet for Light Office Districts and MF-3, etc.).

The bonuses were a quid pro quo.  The city imposed a hard cap on height in return for flexibility on base district heights and FAR, which in turn was conditioned on  property owners providing a public benefit.  The incentive bonuses were part and parcel of the waterfront overlay scheme.  By omitting this flexibility, the Waterfront Overlay Task Force has actually proposed a set of regulations more restrictive than the 1986 ordinance.

While height limits are critical to protecting Lady Bird Lake, flexible incentive bonuses are crucial for restoring Lady Bird Lake.  Large swaths of the lake front are cluttered by dilapidated developments or, worse, developments obstructing  public access and use of the lake.  The CWS property was a case in point.  While it is reasonable (to a point) to limit the maximum height of development around the lake, it is equally important, in my opinion, to encourage property owners to fix some of bad developments.  That requires incentives.  After all, if a property owner must comply with stringent site regulations no matter what, why let the public traipse through its property? 

Although the Task Force majority report (pdf) endorses some type of bonus system, it criticized the 1986 bonus provisions because they "did not have a means to allocate fairly additional height or increased floor area ratios in response to community benefits provided by proposed new development."  (p.2).   (Somewhat confusingly, though, it recommends that City Council  "reinstated [sic] the bonus provisions previously outlined in the 1986 ordinance.")

The proposed ordinance does not address incentive bonuses at all.  City Council thus is being asked to adopt hard height limits now and leave the incentive bonuses for future debate.  And that's the real problem.  Any proposal will draw opposition from some quarters of town.  Furious opposition.  Opposition from people who care less about restoring access to the lake than limiting the size or density of new developments -- even developments that would comply with the WO height limits.

If we want to incentivize property owners to fix bad developments, restore access to the lake, or dedicate green space for public use, we need to work out the incentives now, before the height limits are adopted.  Otherwise, expect some of those now paying lip service to bonuses to quickly lose their enthusiam.  

Chris Riley

Yesterday I went to the "Urban is Core" forum downtown, hosted by DANA, Austinist, the Downtown Austin Alliance and seven other organizations.  I try to go to at least one of these forums per race. They're fun and I get a chance to put some names with faces.  They rarely affect my vote, though. 

Take the race between Chris Riley and Perla Cavazos for Place 1. I already have plenty of information about them from their work on the Planning Commission. If I want to know how someone will handle an issue in the future, I care a lot more about his track record than his campaign promises.

The race between Chris and Perla should not be a close call for anyone who cares about urban density and urban form -- or who wants to balance ANC's increasing weight on Council.

Chris gets the benefits of density. He's worked for it.  He's voted for it. He established his bona fides a long time ago.  For example, as a Planning Commissioner, he voted to allow additional height for 7 Rio, a slender 34-story tower proposed for the site of Ranch 626 on West 7th St. (I doubt it will ever be built, but that's not the point here).  He voted for 7 Rio even though, as a downtown resident, he was more likely to be affected by it than most other city residents.

Perla toed the ANC line. At the Urban is Core Forum, she actually cited OWANA's opposition as a justification for her vote, as if OWANA, on the other side of Lamar, ought to have a greater say in downtown development than the people who actually live there. That was a good example of how ANC's hard-line invoke neighborhood support when it serves their interests and ignore it when it doesn't. Expect more of the same if Perla is elected.  Laura Morrison has proven that she will follow ANC policy rigidly and inflexibly.  We don't need another person on Council who takes her marching orders from ANC.

Management style also matters to me.  As a Planning Commissioner, Perla had a tendency to micro-manage. For example, I recall that at one of the hearings on Phase II of the Domain, Perla (and a couple of other commissioners) spent an inordinate amount of time discussing the kind of vegetation the developer should use around the retention pond. That's not really their job; the city has staff for that.

None of this implies that I always agreed with Chris's votes as Planning Commissioner.  I frequently disagreed with him.  But if 100% agreement were my standard, I'd never get to vote.

This is an important race. ANC already has an implacable advocate on Council in Laura Morrison. While Perla is unlikely to be as militant as Morrison, make no mistake -- she is ANC's woman. With Wynn (and possibly McCracken) leaving, Council is in real jeopardy of sliding into ANC control. That's not good for anyone who cares about Austin's natural development into a more livable, urban city.

Other Riley endorsements:

M1EK

Burnt Orange Report

NIMBY insurance

Ryan Avent suggests, in response to a fierce battle over a DC neighborhood plan, that neighborhoods be offered NIMBY insurance:

[I]s there a market for NIMBY insurance? That is, I’d love to collect tiny premiums from residents looking at potential development near their homes, in exchange for which I’d take responsibility for the change in value of their home relative to homes outside of the directly affected area. If their property does poorly relative to other homes, then I’d shell out for the difference, either at an agreed upon time after development or upon sale. If it does better, well, the gain would accrue to me.

A city that was confident that it was developing well could even offer this kind of service at a deep discount relative to what the private market would likely ask. It might help combat knee-jerk opposition to development plans, and since NIMBYs seem, to me, to be bad at gauging the effect of development on their property values, it would be a nice source of revenue. And of course, if the government ended up being totally wrong, homeowners would be protected.

Both Robert Shiller (the "Shiller" in the Case-Shiller index) and William Fischel (Dartmouth economist) have proposed similar insurance schemes in the past, although Shiller's was not tied to specific development projects.  Fischel set out his proposal in the Homevoter Hypothesis.  

This is sound in theory.  Homeowners' risk aversion is an obstacle to optimal city development policy.  It's hard to make this work in practice, though.  First, one needs an index to measure whether a property is doing poorly "relative to other homes."  One can think of the Case-Shiller index as an attempt to construct such a measure, but I don't think it's fine-grained enough to detect variations in neighborhood values.

A bigger problem is moral hazard.  New developments can pose risks to property values, although homeowners do indeed systematically overestimate these risks.  But lots of other things affect property values as well -- rising crime, deteriorating  appearance (trash, graffiti), deteriorating school quality.  (Childless households have an incentive to worry about school quality because it affects their property values, too.)  Some neighbors have tended vacant, foreclosed homes out of a concern for their own property values.  Insuring homeowners against the impact of new developments would give them less incentive to worry about the impact of other variables under their control.  It would be impossible to separate these other influences from the impact of development.

Finally, neighborhoods also experience secular declines.  Cities are dynamic places, and change is often chaotic and turbulent.  Neighborhoods, blocks, even individual streets can get caught in little eddies created by this turbulence.  They can improve or deteriorate relative to the rest of the city for no observable reason.  Small, random events can cause one neighborhood to gentrify and another to go into a tailspin.  This unpredictability would make it very hard to accurately appraise the  risk of a new development.  Even assuming the risk could be accurately estimated, insuring  against the impact of a given development might very well require insuring against change itself.  That would be a much more expensive insurance policy.  It's not one that many developers (or cities) would be willing to underwrite.

Complete and utter capitulation

Shilli points us to Council's impending vote to exclude virtually all of West Campus from the VMU district.  The area at issue actually includes much more than West Campus -- it's the area bounded by MLK, Lamar, I-35 and 45th.  This is Austin's central core, the area where VMU is most appropriate.

Here are the grim statistics:  

The VMU Overlay District in the Central Austin Combined Neighborhood Planning Area includes 57.95 acres. The Council will exclude 49.1 acres -- 85% of the total acreage.

Of the remaining few acres, it will opt 5.55 acres out of the parking reduction incentive and 3.30 acres out of all of the relaxed dimensional standards.

It will opt in 7.58 acres, but, again, will opt them out of either parking or dimensional incentives or both.

Thus, none of the tracts in Austin's central core will be eligible for the full set of VMU incentives.

Here's the map of the West Campus/Medical Center area.  Note that the neighborhood wants to exempt Guadalupe, including the segment through the heart of campus.  It simply decided it didn't want to play, bargain be damned.    

Guadalupe illustrates a point I've tried to make before:  Some of our corridors are too important, and serve too many city residents (or students), to be delegated to a single, parochial neighborhood.  City Council has no business giving CANPAC control over Guadalupe through UT's campus.  That's no more CANPAC's concern than the university's, its students, or the rest of ours, for that matter.

Needless to say, by drawing out its VMU application for two and a half years, CANPAC has managed to bring it up for vote when city council members -- McCracken and Leffingwell, in particular -- are jockeying for votes.  But this is an utter capitulation by Council.  VMU was Brewster's baby.  He's thrown up his hands, sunk to his knees, and begged ANC for mercy.  I figured Brewster would understand that the ANC types won't be voting for him anyway; he might as well take a stand to defend his legacy.   Martinez and Wynn have nothing to lose, either -- Martinez is unopposed and Wynn's not running for reelection.  They've both supported VMU in the past and should stick to their principles.  Who knows, they might be able to sway one other Council member.

PS:  M1EK reminds me that the University Neighborhood Overlay already loosens restrictions along Guadalupe between UT and West Campus, and along a segment of MLK.  The UNO already provides the benefits of VMU. City Council's action therefore will not impact this part of town.

The UNO does not control the east side of Guadalupe, Guadalupe north of 30th street, 38th Street, or Lamar.  Here CANPAC's opt-out has real bite.  Council did not tolerate such wholesale opt-outs south of Town Lake, even from Zilker.

See the posts below for VMU's tortured course since it was approved in August 2006:

1. Apartment Complex Mentality (Aug. 27, 2008)
2. Council caves to Allandale (June 23, 2008) 
3. VMU on South Lamar (June 25, 2008) 
4. Props to Council (March 18, 2008) 
5. VMU at City Council: This is very encouraging (Feb. 1, 2008) 
6. VMU:  Time for City Council to enforce the bargain (Jan. 31, 2008) 
7. Vertical Mixed Use:  Not everyone is a grown up (Dec. 3, 2007)
8. Vertical Mixed use:  The grown-ups go first (Nov. 30, 2007)
9. A VMU primer (Nov. 30, 2007)
10. Breaking the VMU bargain (Feb. 14, 2007)