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Travis County Commissioners Court

November 25, 2008
Item 1

View captioned video.

Now let's call up number 1. Let me indicate my intention to call up item no. 25 next because we do have representatives here from the city of Austin. 1. Receive briefing from city of Austin staff on the proposed homestead preservation reinvestment zone, a tax increment financing (tif) zone supporting affordable housing in the homestead preservation district, and take appropriate action. Administrative operations items

>> we have got councilmember martinez here. Morrison. And other city staff. And a fan of yours.

>> [laughter]

>> thank you, Commissioners, we have our city staff here, city attorney, assistant city attorney david lloyd, our chief financial officer leslie browd der and Margaret shaw from neighborhood housing community development and of course my colleague councilmember laura morrison. We're here to brief you this morning. On the progress that we are making with the proposed homestead preservation district for central east Austin. Staff is going to present to you the statutory requirements. We're going to talk to you a little bit about the process thus far, community outreach that's taken place. Then we're going to ask you to continue the conversation. There's still time for you to consider and ask questions so that staff can -- can provide you with the information that you need to make any potential decisions. You still have Commissioners court on December 23rd and the 30th, if -- if, you know, we want to hold it out that long. But we would like to adopt it by January 1 of '09, we are here today just presenting information, taking any questions that you might have and then try to get the answers to those questions, if we can't answer them today. We thank you so much for inviting us and having us here. I'm going to turn it over to Margaret shaw.

>> did you guys get an opportunity -- from we go there, before we go there, did you get an opportunity to see what Travis County's staff recommendation was in this particular regard.

>> we did.

>> okay. So I hope that you will take that into light of what they are considering and because I'm leaning very heavy on what our staff is saying.

>> sure.

>> Travis County. So I want y'all to understand that. As we proceed. That -- that we'll -- I know personally I'm going to be looking at our staff recommendation. So I want to make sure everybody understand that.

>> Commissioner Davis, we -- to be quite honest with you, staff, our staff at the city has also issued the same cautions. We are in an economic crisis, that applies to all of us. We simply believe that working towards long-term sustainably affordable housing is a core function and service and value that we would like to provide to our citizens. So we're going to continue moving forward, but we have those same cautions as well moving forward. I appreciate your concerns.

>> okie-doke.

>> thank you.

>> good morning, Commissioners. Again my name is Margaret shaw. I'm with the city of Austin's neighborhood housing and community development department and leslie browd der and I will be walking through some slides before you. We also have a slide show. I'm not sure how that works for the -- for the general public. But we'll continue with our presentation. First I want to start with a little background of the legislation itself. Introduced first in 2005 amended in 2007 by state representative eddie rodriguez. It creates three basic tools to increase home ownership, provide affordable housing and prevent the involuntary loss of home ownership in basically central east Austin. The city council of Austin adopted that district in January of 2007. There are three basic components that the statute puts forward. A homestead land trust which allows the city of Austin to designate non-profits or other public entities to operate as community land trusts and receive moneys from the t.i.f. Should it be created. A homestead land bank that allows the city to operate with vacant land that is foreclosed on due to non-payment of property taxes. We can take that land and transfer it into affordable housing. But the city council on October 16th what they districted us to do is explore the feasibility of adopting that land bank city wide, because when staff researched the narrow descriptions of what's allowed under the land bank, only one parcel was found in the homestead district. So we're looking at maybe using this tool on a broader basis. Last but not least we are here today to speak to the reinvestment zone which allows for tax increment financing to create and retain affordable housing. As many of you are familiar, the homestead preservation reinvestment zone is basically defined on the north by manor road to the east by airport and springdale to the south by lady bird lake and on the east by i-35. It constitutes over 6800 parcels. Tax parcels, of which 464 are in transit oriented districts. The transit tools that the city of Austin is using to try to create intense development in certain areas, those will be included right now. Council has directed us to include those in the homestead reservation district. Preservation district. This is about a $1.1 million tax value for the city and about a billion for the county. Throughout the process, there's been enormous efforts to have the public included in this discussion. Beginning with the legislative process as well as city council action. My department's oversight board of the community development commission as well as some neighborhood outreach. We also have additional public hearing coming up at the city on December 18th. Next slide walks through some of the key actions that we have made recently to create on 10:15, we came and have been working with your staff to -- to further educate them and us on what the issues are. We have been to council for some of the key issues on -- in October. And we are also in the process of briefing as state law requires, taxing jurisdictions on the tax increment financing. The project plan which is required under a t.i.f., we have released a preliminary project plan. The statute dictates very specifically the use of the funds, what ties it to certain income let mes. We have used the broadly defined the use of those to create, retain, acquire properties or interests that we can have the broadest use of those moneys should we adopt that. I would like to caution folks to a standards t.i.f. Not issuing debt, we will just be using the t.i.f. Revenue to finance those projects within the district. With that I would like to turn it over to leslie.

>> thanks, Margaret. These next couple of slides really focus on some of the financial information. In terms of the estimate tax increment potential within the homestead preservation district. We worked with charles heimsath of capital market research to evaluate what type of growth that we could potentially see within the district tax base over the 10 year t.i.f. Life. In terms of the projections we looked at low ranges, we looked at high ranges and just to give you a little bit more information, about the range that's we did look at, we are going to be working your staff to give them more information related to the county and your taxing bodies since they vary a little bit from the cities. On the low range we looked at growth within the district, that would be consistent with the city's overall growth. Actually, less than we have seen since the year 2000. But going forward on the range of about five percent per year. And then on the high range, the district has actually grown significantly more than that since the year 2000, more in the range of about 12.9% per year. We didn't go that high but we looked at a few years into the short term with the higher growth rate, went consistent with the city for the rest of the estimated t.i.f. Life. Ultimately for purposes of the revenue projections, we landed on a mid range value and that was consistent for what we did for waller creek as well. We looked at aggressive, conservative, we ultimately did our projections based on an average. Go to the next one. This next slide just shows you some of the factors that we looked at when we put together the revenue projections. We used a range of assumptions, I talked a little bit about the growth on the previous slide. We did include the -- the estimated tax increment associated with the transit oriented development districts that Margaret mentioned earlier. There are two of those located within the homestead preservation zone. And then we also looked at various tax rates and again settled on a mid range there as well. We calculated based on the assessed valuation projections that we developed an effective rate and rollback rate. I'm sure your staff talks to you a lot about that during the budget process. We assume over time that city council, for example, would not pick one or the other, but would probably go somewhere in between. Then these -- this page actually outlines the -- the estimated revenue projections. We have shown just an estimate here of the combined city and county t.i.f. Revenue. Should the county elect to join us in this effort. And we have shown that at various increment levels for information purposes only for both parties that said that you can start to think about the type of revenue that different levels of increment could generate. At 100% it's the most significant, close to $40 million over the 10 year period with about an annual average of 4.2 million each year. Of course that doesn't happen in the first year. It starts slow and it builds gradually over time. And at the low range around 30% would bring in about 1.3 million each year on the average, over the 10 year period. And you could see probably close to $13 million in -- in combined t.i.f. Revenue. Again, Margaret indicated that the t.i.f. Must be approved by the county in order to become effective and if the county approves the t.i.f. We'll be talking to you and your staff as we go forward about the amount of -- of t.i.f. Revenue generated by the county. That must or excuse me again rated by the city then that is matched by the county under the statute. Just a little bit of compare and contrast here in terms of the -- of the traditional t.i.f. That we are used to seeing and the homestead preservation t.i.f. The tax increment financing are both fairly common in terms of the general goal. They are designed to promote design or reinvestment within the t.i.f. Zone and this certainly does promote reinvestment within the zone. A traditional t.i.f. Really focuses on commercial investment and the short I guess description of a traditional t.i.f. Is that the property values increase due to the improvements that you are making in the area that are funded with the t.i.f. Revenue. The homestead preservation t.i.f. Is a slightly different animal. It creates and preserves affordable housing. The emphasis is on residential as compared to commercial and then of course there is that unique funding piece that -- that requires both the city and the county to join before the t.i.f. Can become effective. Turn it back over to Margaret.

>> so just to highlight for the next steps, we'll meet in the next few weeks to continue speaking with your staff and working through what increments might be appropriate as we work through those implications as leslie said. Also the project in financing plan will -- we have a preliminary project plan out. We are open to discussion and interests of where the priorities are for the county of serving those folks. Last but not least during the life of that t.i.f. Is understanding some of the roles and responsibilities for instance, the t.o.d.es, for they decide to remove the t.o.d.'s for other people, how do we change the boundaries of that and how would those actions take place. With that we just wanted to wrap up with the next steps. Obviously we will continue with our staff briefings. We did the Austin independent school board last night. Still scheduling the health care district, but we will continue with that. As I said the city council is expected to have their public hearing on December 18th. And take action at that time. And we have just for purposes of discussion highlighted that there are two more county meetings. If we want to create the t.i.f. In 2008. If we take action, both bodies by the end of this calendar year, 2008 will be the base year for that t.i.f. However, if discussions go forward and we move into 2009, 2009 would become the base year for that t.i.f. With that I'm happy to answer any questions.

>> I have a lot of questions. But before I do that I would like to hear from our staff. P.b.o. Who has also given you the same documentation that they gave us yesterday fuss us yesterday afternoon, I would like to hear what they have to say about what you are proposing, walk through it as you have walked through your side of it, I would like to see what staff, county staff have said about what they have to say about the particular proposal. So I would like to have county staff come up and -- and -- let me say this, also, the majority of -- of what we are talking about is actually within the boundaries of precinct 1, this district. The majority of the parcel that's we are looking at are basically in precinct 1. And before you start, though, I would like to publicly thank representative eddie rodriguez for what he's done as far as bringing the -- to the forefront the need of affordable housing. And I do not want anyone here in this particular arena setting today, to leave here thinking that Commissioner Davis is anti-affordable housing, that is -- that is the wrong perception. Let me say this, years ago, when I was chairing east Austin strategy, this is back in the mid 1980's, there was a proposal to do away with the booker t. Washington project terrace. At that time those transitional housings were boarded up, right across from the old a.c.c. Ridgeview council on thompson, they were, the authority was going to tear those down and sell to a developer. Of course at that time we had heard about this by the efforts of -- of the east Austin strategy team, many others, in this community we -- we said no. We testified before them and also to -- to mayor cooksey at that time who was the mayor of Austin and said that we would like to ensure that this particular affordable housing unit is still made available. With the help of the late jake pickle, who -- who actually gave us federal dollars here, at the end of the day, you have the booker t. Washington terrace affordable housing units in -- they actually are detached, then -- the way the old box shape used to be, that is still a very viable affordable housing -- that family settings in east Austin. So -- so we have done not only talked the talk about affordable housing, but we have done something about it. Of course since this is in my precinct and the majority of these folks are my constituents, of course, I would like to look at this but still looking in the interests of affordable housing and telling everyone yes we are interested in continuing to provide affordable housing. But I want to -- I'm going to shut up and let them go ahead and talk.

>> I think the fact that this goes down to lady bird lake includes precinct 4.

>> it does include precinct 4.

>> it's all part of the inner city. Obviously this is an area that does need affordable housing. Thank you.

>> come to think of it, I believe it's in my precinct, too. Do you all have any comments? We have specific questions maybe.

>> all right. I'm harvey Davis, here with leroy nellis, our budget manager, rodney rose our executive manager for planning and budget. I did provide the court with -- with a list of -- of questions and concerns and these were shared with -- with this -- with the city staff. -- I would be certainly happy to or we would be happy to discuss any individual items that are listed in this presentation. But I think the -- the summary or the concerns that we had more was that we -- that we just had gotten the information about a month ago of the city's plan and we -- we needed really need more time to better understand what -- what the intentions are for the use of the t.i.f. Funds. And some internal questions that we have about -- about how this is -- how this would all work. I think the -- there's some questions about -- about because of the economic climate the -- the -- how -- how good is our property tax collection going to be in the coming year. We had more information, you know, in January or going forward next year about -- about how tax collections are going -- going to be going and whether this is -- this is because of the economic crisis, something that -- that -- that the county could afford to -- to do.

>> any questions for the staff -- Commissioner Gomez?

>> I -- the thing is that there is an opportunity, though, to -- if we decided to try this out as let's call it a pilot project, let's see what the figures all turn out to be, that first year, the fact that we're in an economic slump would kind of give us the opportunity to -- to make affordable housing one of our top priorities. And then I agree with -- with councilmember martinez, it is a core function, especially of Travis County government. To make sure that we have housing and basic needs for our constituents. Especially if they are indigent. And so there's -- there's still an opportunity, though, in spite of the economic slump, when we do expect, is that we would make this a top priority and then we would go along with all of the other needs that Travis County has. But I think that -- I think that it's high time that we did something for our constituents who are always paying the taxes.

>> that was one of the points that was listed was there is the option of having a voluntary t.i.f., similar to the b.c.p. Where the funds are appropriated on an annual basis.

>> what I was after, though, harvey, is if you will publicly state the concern that was in the memo that you handed out and shared with the members of the court and also the city of Austin. What are the concerns that we have in regard to this particular proposal?

>> well, some of the concerns were --

>> just go through what you have.

>> some of the concerns included county's affordable housing efforts have -- have traditionally been more outside the city limits of Austin. The city is an -- is a participating jurisdiction, receives home funds and cdbg funds directly from h.u.d. So we have -- so this would be a change in -- in efforts in that the county would be committing significant tax -- property tax resources to -- to an inner city section of the city. Another question was that we had this -- that the t.i.f. Is to provide home ownership resources for low and moderate income families, 25% of which have to be used for -- for families below 30% of the -- of the Austin median family income and so we -- we needed to better understand how you can help families at 30% with home ownership programs when you -- you usually think of people in the category needing assistance in rental kind of assistance.

>> because the Austin median family income at 30%, at 30% of Austin median family income is $21,350.

>> for a family of hour.

>> for a family of four.

>> right.

>> so how can one family of four, $21,350 afford a home and really be able to -- to manage that on the budget available.

>> right. That was a -- that was a question.

>> that the most appropriate use of their resources?

>> right.

>> another question that was raised in the -- in my memo is -- is whether this -- this -- whether this is the best area to put significant resources. In other words, there are many areas in the county that need assistance, affordable housing assistance, manor, Pflugerville, further out in -- in the eastern part of the county.

>> so there are also places in western Travis County.

>> right.

>> that have --

>> right.

>> [laughter]

>> and southern. County, too.

>> let's not

>> [indiscernible] this before we adopt it.

>> another question that we raise is that the -- the program -- it appears that the program is to -- for two initiatives. A community land trust and shared equity programs. Of which we don't -- we have not had any -- we're not familiar with those programs and we didn't have any -- the county had no input in deciding whether these were going to be the priorities and well should these be the priorities? Are there other options, if you have a t.i.f. In this area, are there other options that should be considered. So -- so those are some of the points that were raised in the -- in the memo. I did have a -- a one point that was not correct, I did state that -- that the t.o.d.'s were not included in the t.i.f. And I was incorrect in that. They are included in the -- in what the city council has.

>> you had a recommendation -- what was your recommendation?

>> our recommendation was that we needed more time to consider, we didn't have the information to be able to make a recommendation that county staff needed more time to be able to make one.

>> right. Let me say this as far as the boundaries of precinct 1 is concerned. Everyone listening to this, will listen to it and review it will understand the boundaries of this thing as far as precinct 1 is concerned. I'm not going into precinct 4.

>> [indiscernible] to the west, manor road to the north. All the way to cherrywood going east on -- on manor road. And then goes from cherrywood all the way up to -- to 38th and a half. From 38th and a half it -- it filters down and tie into airport boulevard. All the way down to oak springs. Down at -- right at that church's chicken at oak springs and airport. From that point all the way to -- to webberville road. And at that point that's where you have the booker t. Washington housing, transitional housing terrace at this point all the way down to 7th street. That's basically within the boundaries of precinct 1, from 7th street the most southern boundary. The eastern, southern and northern boundary has been -- western boundary has basically been defined with i-35 being to the west. As you can see, that is a big chunk of parcels within the central part of the city, but however also within the found dears of precinct 1. I have some real, room a lot of -- real, real a lot of concerns. Some of the concerns -- see I have always worked basically with people, I have worked with the neighborhood association,

>> [indiscernible] it's too late for me to change. Sometimes politics get involved, but -- but I try to stay away from as much politics as possible. From grassroots efforts, the way that we have done things, from the past within the boundaries that I'm talking about right now. When we actually wanted to accomplish things, we would go door to door and deal with a lot of --

>> do you have any questions from staff?

>> I do, judge. Let me --

>> I think that you are going on and on and on --

>> [multiple voices]

>> at best -- do you have any questions from staff? Because I have some --

>> [multiple voices]

>> don't cut me off, please.

>> I'm cutting you off because this is an opportunity to ask questions. You are not doing that.

>> well, let me put it to you like this. The question is that the same due diligence that I was -- that I was unable to -- to allow to come forth because of our judge, here, and he is the -- he is the -- the chief of -- up on this particular dais as far as the person that kind of directs things the way they are supposed to go, the reason why I oppose that what I was talking about was the point that the involvement level of what we are saying, what we are talking about I don't think has been met. The reason why I'm saying that is because of the fact that -- that the neighborhood associations that we have within those boundaries just in precinct 1 that I mentioned several of them have never even been contacted. There's a lot of quotes, don't -- a lot of folks don't even know what's going on. They -- they have heard --

>> we're not taking action today.

>> well this -- I --

>> all we're doing is discussing today are there questions.

>> but --

>> appropriate action --

>> we're not taking action today.

>> all right.

>> so the question that I need to ask -- that I need to ask county -- city staff is this: this -- was there any due diligence done, per se, within the boundaries of this particular concept, talking to folks that a grassroots initiative would do to see what their feedback is. Because I've had a lot of people that have contacted me and said that they felt that an example of

>> [indiscernible] may have a residents, they don't own the land. The house they own, but the land they don't own it. They have -- this is not making sense to them. How can you own a home and don't own the property under the home. Another question is --

>> is there an answer to that question? Please.

>> Margaret shaw. I just want to clarify the land trust is not required for the funds. It's one of the tools that's used in a lot of fast appreciating cities, santa fe, new mexico, had them for almost 20 years now, other communities throughout latin america. You have actually characterized it correctly. The government or non-profit owns the land which is typically the highest value to -- part of your property tax evaluation. And then the owner would own the house, improvements above. But I want to clarify that this -- this funding would not be required only to be used for community land trust. But it is a way to get lower income folks at 35,000 and lower to be able to own homes in one of the fastest appreciating parts of the city.

>> right. I -- I don't think -- don't think that I'm not appreciative of what you're trying to do.

>> absolutely.

>> I appreciate everybody and anybody trying to deal with affordable housing.

>> thank you.

>> now, there was a bond initiative that was conducted before the voters at the city of Austin that went before and that bond initiative was dealing with affordable housing, how much was that -- it was just recently what --

>> $55 million.

>> 55.

>> over 7 years.

>> $55 million. The question came to me, why can't you use that general fund money? The $55 million in the same area where you said that you are going to provide affordable housing, why can that be used for that?

>> we do.

>> we do, we use that. As many of us know the affordable housing issues in Austin are more than our resources have, both our federal dollars, we also commit as a city. Our voters have voted that $55 million. I think of -- of affordable housing it's much like a capital improvement. It's important to have a variety of sources of income that are assured over multi-years so we can create that infrastructure of housing.

>> of housing.

>> another.

>> I -- if I can just briefly respond to your question about due diligence. We have been conducting community outreach meetings. We started in 2007. Meeting with folks that lived in the district, inviting those folks to have to different points where we were holding gatherings. The community development commission and affordable housing advocates for the -- you know, through the city of Austin have also been meeting and talking to folks over the last couple of years about trying to get this -- this homestead preservation district up and running.

>> did you go to the churches? The reason why I said that, because the -- because the many of -- within this district itself. Churches such as david's chapel, mount sold live -- the list goes on and on.

>> [one moment please for change in captioners] of the property underneath the home moving forward. But adopting the homestead preservation district doesn't change one single thing for a resident that lives within the boundaries of that district at this point. It doesn't changes their tax structure.

>> if I could just add one item to that and that is that before I was city councilmember, which began in June, I was president of the Austin neighborhoods council for two years. And during my tenure, we started what we called the anc east sector and we met monthly. Over the two years it grew into quite a lively group and they still thrive today and meet monthly, and I can -- we had representatives from cherrywood, east caesar chavez that came to the meeting and I would say certainly affordable housing is an issue was on our agenda every single month and many times they were definitely -- we were definitely monitoring the progress or lack thereof at certain times in moving forward with this t.i.f. And the other pieces that go with it. So I know that through the outreach through the neighborhood associations, the leaders were certainly there talking about it and supportive of it and sent in several resolutions to the general Austin neighborhoods council that were then adopted by the full council supporting the formation of this t.i.f.

>> okay. All right. Well, thank you for those comments. I'm just saying that there has been those that may have been left out. I'm just bringing that to your attention. Now, on the third thing, you mentioned the commercial properties within the district. And would those commercial properties retain their present zoning or will -- if they are acquired by the land trust, will they be converted to residential affordable housing units?

>> the land trust would not normally do commercial. This would not change zoning. The same issues would apply if they rezoned, if they wish to do that.

>> another question is on the -- when this is established, this t.i.f. Is established, if it is established, I don't really know what's going to really happen here, there again is still some questions that I think need to be raised such as who will be responsible for the land trust and holding the trust of the land that they can acquire to actually be developed? Who would that be? Now, we have Travis County here, we have Austin housing authority, but -- I've heard you mention nonprofits, and I've seen several nonprofits listed here as far as within the boundary. The boundaries of some of these nonprofits are identical and so close to what the boundaries are of the district itself. So who would be responsible, accountable, to the land -- who will actually hold those holdings? Who would it be?

>> the city council in October, Commissioner, designated three right now that have operations. The Austin housing finance corporation, Travis County, as well as nonprofit called people trust. Which is an affiliate of people fund. Those are the three most active c.l.t. Models working today in Austin and those would be responsible for that.

>> okay. If as you stated before if a person would like to -- let's say, I don't, I want to allow my land even with houses on it right now, I would like my land to go to the trust, to the land bank. And once that's done, and if the -- whoever overceases, Travis County, Austin housing folks, are the people's trust, whichever one of those parties, once that land -- and I guess I have to ask the question, once that land is taken into that trust-type situation, will this particular property be taken off the tax rolls?

>> if it's a governmental entity, yes, sir.

>> what about a nonprofit?

>> a nonprofit, I believed we would have to work through the appraisal district to see what -- it would be a discounted property value.

>> a discounted property value. So any time -- and I want to make sure that we understand this. Any time that we take property off the tax roll of even this county and property off the tax rolls, that means somebody else has to pick it up on the other side.

>> yes, sir.

>> that means you and anybody else, all the other taxpayers in Travis County have to pick up the tab. Right now we are in a recessionary period. We don't know what's going to happen in this economic downturn right now. And I think anything that we do, we've got to be very, very cautious looking at the economic situation all across this nation, we've got to be very cautious as local government, national government, anybody else, on how we deal with taxes and the burden of our taxes on the residents of this county. So if that's the case and it's taken off the tax roll, it means that whatever that equates to, the rest of the taxpayers in Travis County will have to pick the tab up. That's exactly what it amounts to; is that correct?

>> yes, sir.

>> Commissioner, if I could follow up. That is correct.

>> thank you.

>> that's absolutely correct. But what you have to keep in mind is the reduced tax rolls that come in on that particular property, that savings is going to be passed on to that low-income family that lives in that structure. And yes, we will have to pick that up, someone else somewhere else will have to pick up the burden for that. But the goal here is to alleviate tax burden on folks who can't pay their taxes and they are being forced to sell their homes and move out, farther out and find something that's more affordable. So we're trying to prevent that from happening.

>> but part of the problem, and this is what I've heard all over in meetings that I've attended in east Austin, part of the problem that I've heard is this, is that the mcmansions that have just inundated the -- area, everywhere you look around you've got a new mcmansion --

>> and this would prevent --

>> continue to drive up tax value of those folks that's around there and things of that nature. So it's almost like either you join us or you are forced to deal with what we have to deal with here. And those mcmansions, that's what I hear more than anything else, they say Commissioner, can you do anything about most mcmansions --

>> and you can say yes --

>> pardon me?

>> you can say yes, we can do something bit if you adopt the homestead preservation district, it will preserve those properties as they are and not allow them to be flipped, gentrified and mcmansioneded.

>> the point is -- the difference is who ever controls the land is in control. That's the bottom line. Whoever controls the land is in control. And right now if the trust -- whoever, people's trust, Travis County, anybody else, whoever is controlling the land is in control. And what's going to happen after the next ten years? What's going to happen after this t.i.f. Period is over? What's ag after that?

>> our goal is continue it, renew it, to keep it going in perpetuity to preserve affordable housing moving forward so that he we don't gentrify, so that people can stay in east Austin and not have to move out.

>> as Commissioner Daugherty straight, he got four sections in western Travis County, so why not in western Travis County or any other poor section of the county. We've got gentrification all over the place. But part of the gentrification has been as far as what the folks are telling me, you allow these mcmansions come in and the calf has already escaped. That's part of the problem. So anyway, again, I'm not anti-affordable housing, but I think we've got a lot of work to do, a lot of work to do to get there where we need to do. $55 million that's the voters have already approved, as you've stated, it appears we can go into the general fund and take some of that $55 million and accomplish some of the same things. Thank you.

>> thank you, Commissioner Davis.

>> thank you, judge.

>> susan?

>> Travis County auditor. The one thing I just want to put in the mix here for your consideration is it is unfortunate that this is coming up at a time when our economy is in the shape that it is. But that's just plain fact. And I don't think there's any question the housing values are going down and when we see the appraisals done for the next tax year we're going to see probably a significant decrease from today. The other thing is everyone read the article in the american-statesman about some of the taxes on some of the large commercial properties. We don't know how that's going to fall out. We're really not going to have a bead on what the tax collection rates are going to be until we get well into January. And it could be that we -- we just don't know so I'm not predict ing this is what's going to be, I'm just saying it is not -- you can't disregard the fact that there may be a significant drop in the collection on significant properties. A lot of homes are in foreclosures, people are not making their payments, which means they are not paying into the escrow accounts for their property taxes. We simply do not have any idea how that's going to play out at this point in time. It may be insignificant and not impact us at all, but it may be extremely significant. And if it is significant, then we will be in a position where we will have to dramatically cut services or make other kinds of adjustments. So I don't think any of us would have predicted that the economy was in this shape. Texas certainly hasn't been hit as hard as many other areas, but we're seeing things that no one could ever have contemplated. So I just think, like even the numbers that the city has put out, you know, you can only put out numbers with the information you have. But I -- I -- you know, I would suggest that we put numbers out there predicting downturns. Because we might have that and have a strategy of what we're going to do. And if we are significantly short on tax collections, and I don't know if that's going to happen, but if we are, is this the most significant thing that you want to address. That's really kind of where you are right now. You are trying to make a decision when a very significant piece of information is not available to you. It may -- we hope it won't be significant, but I think we will see -- we will see some fallout. We're not going to know that until the taxes are due on the commercial and as well as homestead. So, you know, that's just my caution in terms of making decisions on numbers with this kind of an economy.

>> Commissioner eckhardt.

>> I have several questions that I don't know we'll be able to answer today but I wanted to put them on the table. I hope you will indulge me in a statement. I do see value in the tools laid out here today, the trust and land bank. Very intriguing tools. And we are discussing funding those tools with the t.i.f. Those tools could be fund understand other ways, for instance, the general fund, which could be a more transparent and long-lasting way, but I think we should certainly explore the option of funding it with t.i.f. The trust, of course, provides a third way that we haven't yet seen in this area. One can rent their home or they can own their home, and the trust provides us a third way of owning the improvement and having a nonprofit entity own the dirt, as it were. And that's a third way worthy of exploration, absolutely. And then, of course, the land bank, increasing the ability to create single resident occupancy units for affordability in the district. The question I have go to location, sources of revenue, the tools available and the performance measures that we're looking for. The question I have is in Travis County, where are the most disadvantaged neighborhoods? Then I would like to parse those out, unincorporated disadvantaged versus incorporated. The second is how much investment do we currently have in our community in affordable housing in Travis County. Also parsed out in incorporated versus unincorporated. The reason is not because I think we should be silo, bud it's not to say the city should do this and the county should do this, it's just to say what revenue sources are available unique to unincorporate have had incorporated. The third question is what tools are available to us like land trusts, like land banks, like nonprofit corporations building s.r.o.s. What tools are available to us, which ones are we currently try, which should we be trying and which ones are best tailored to urban areas, suburban areas, that kind of thing. And the fourth, what indicators are we going to be expecting for success? And when we reach those indicators, what do we do? Because I see this particular district, which was created based on 2000 census data, when the 2010 census data comes out, it may not be as disadvantaged, I'm assuming it will not be as disadvantaged as it was in 2000, and perhaps might not be in the same ranking overall in the county. If the district does what we hope it will do, there will be no need for the t.i.f. In that district. So we need to identify it from the up front what the indicators are so that we as politicians don't have to haggle five years from now saying, you know, montopolis is more disadvantaged, blah, blah, blah. If we decide in advance what those indicators are so we essentially have a kill switch on this zone with a commitment to continue the March into other areas of disadvantage. I think that would be a really, really good thing for us to explore as a community in advance of doing this. Otherwise we will get in a circumstance where there will be a sense of entitlement in an area that is no longer as -- as needful of this kind of attention.

>> judge, my only response is going to be that montopolis has been there forever and it has been forever neglected. And it wasn't until the early '70s when the streets out there were paved.

>> and there are pockets of --

>> one at a time, please.

>> so the thing that I see here is yeah, I think we need to look at all of these questions. I think we ought to research, and obviously we're going to have to work together to come up with something that works for both of us. But I think that all of these issues that have been raised here probably have some -- they need to be looked at. They need to be researched. Then we need to come up with a good explanation that the people in the district will be able to understand. You know, we can't talk about these things here, although they are great for to us make decisions, but we're making decisions for people who actually live out there, and some of them can't afford to live in Austin anymore. I don't want to see them leaving Austin and Travis County to go somewhere else because this place is not affordable anymore. And so I think we need to keep in mind when we come up with something that we can -- that we can all agree on, that we put it in plain english and that we go out to tell people what exactly is involved, what it means to each of you when you participate, what it's going to -- I mean some of this sounds like reverse mortgage, and I'm not sure that people out there understand that, how it works, how it will affect them and their heirs. But I think it's another good opportunity to come up with something that will help the folks at the bottom. We -- we have all kinds of deals that help people throughout, but, you know, but I'd rather not muddy up the waters by throwing in other areas of Travis County that would benefit from this because the legislation was written for this area. Let's focus on what it was written on and let's try to find answers. There's obviously -- there are obviously a lot of complex questions that we need to find answers for, not necessarily simple, but let's remember to turn that into plain english and let's explain it to folks. And whatever I can do to go out there and explain this to people in their homes, I'm ready to do. Thanks.

>> Commissioner Daugherty.

>> mike, first of all, thank you and laurie for taking the time to come over here and speak with us and bringing your staff. I spoke with eddie in the last year about this because he was I think a little concerned about Gerald, are you going to, you know, have an issue with this and I said, you know, the -- the strategy behind this is certainly merittable, we all know. But I told him that the issue, even though like Commissioner Gomez said, I mean was written for this area. What was written for this area I think because representative rodriguez represents this area. That's not to say this area doesn't really need attention. But I told him the biggest issue I might have is the equity overall. It would be hard for me to go because I can go to cardinal hills, apache shores, one of the things that we really radio trying to find in western Travis County is how do you have places for people -- you know, we kind of have that ski resort mentality west about you come out west, people got the dough to live in big homes, but guess what, they need all the basic needs that every other part of the community needs and they need those people to be able to live somewhere within a reasonable area. I told them that would be one of the biggest issues I would have if I were still going to be precinct 3 Commissioner. So -- but I think little merittable that we're going to continue whoever is in -- we know who is going to be in this seat and I think that they will probably, you know, work just as diligently as I would. I mean it's merittable of what we're doing. It is an issue and it would be an issue for me from the financial part of this thing at this stage because you all are dealing with the same thing that we're dealing with over here, what are the questions that we're going to -- how are we going to answer the questions about the finances and dealing with our core services that we know that we've got to do, and I think it's frightening all of us because every day you pick up the paper, even though we have been resilient somewhat, just today 27% foreclosures that are happening, and susan is right, the commercial folks, they haven't even really begun yet because they are going to get to go and challenge all of their values predicated on their income stream. And we all know they are going to be struggling. So I wish you the best on this thing and -- but do really want to thank you for coming over because I know it's taking time away from you all's schedule.

>> is this general geographic area set by law or determined by us?

>> statutes.

>> it's set by the statutes as drafted. But based primarily in the research that shows in urban core after urban core, tradition -- traditional old neighborhoods, once they reach a certain point, if they are adjacent to the central business district, those neighborhoods become the most gentrified at the most rapid pace because historically they've been undervalued, if you will, compared to those other neighborhoods around the burr anchor. And that's basically where the concept came for this piece of legislation and that's why it was drafted specifically for this area because the research showed that the values were more depressed in this area than any other adjacent neighborhood to the central business district, and the rapid turnover rate was higher than any of the other neighbors surrounding the central business district. But yet eddie happens to be the representative over most of it.

>> if I wanted to see, say, two or three places where homestead t.i.f.'s, homestead preservation projects had been successful, where would I look?

>> I know that there are -- this was modeled after previous legislation in other areas and we'll find the answer to that and get you those communities that are using this tool.

>> okay. Seems to me what we need is a simple english sort of question and answer document that we can share with others. And I would urge us to put one together. The other thing is would you mind if Travis County helped you with the outreach effort?

>> not at all.

>> that the residents who contact us and have questions, we can provide information. I did get two phone calls and it would have helped me to be able to say let me mail you the brochure. With that said, my motion is that we direct staff to work with city of Austin staff to make as much progress as possible on this project between now and the last meeting of this year.

>> second.

>> and if we cannot, my thinking is if we cannot move then, we simply take additional time and try to do it right. It's a big issue and revenue is real important, so I do think we ought to move in this direction, but we've talked about it enough, long enough, I think, to do what we can. And if we have to wait until the revenue picture gets better, my view is that we should do that. At the same time, though, rather than waste the time, we ought to try to put together a simple english explanation of what we have in mind, be able to explain to voters why we think it is beneficial and is likely to be successful and a good investment of public dollars. And other concerns and comments we've heard today, let's just try to address in a question and answer brochure. If we could get a draft and kind of share that, maybe we'll have additional questions, maybe we can tweak the language. I do think we ought to try to proceed together if possible. That long motion and explanation was seconded by Commissioner Gomez. Any discussion?

>> substitute motion on that, and that is based on not only what we've heard here today, what staff has recommended and as far as them making any presentation, and also a letter that each one of you has received, chris, would you all mind, my staff person, you got a copy of that letter, would you read that letter into the record from the newly elected precinct 3 Commissioner? Precinct 3 -- electricity.

>> to the court.

>> dear judge and Commissioners. I have reviewed the staff medical mow related the item 1 on the agenda and the associated documentation for the proposed homestead preservation reinvestment zone. T.i.f. Zone. For the homestead preservation district. As Commissioner elect for precinct 3 who along with the rest of the court will most likely be facing budgetary challenges next year, it seems to me that the prudent and perhaps most responsible action is to refrain from any commitment at this time that might possibly erode the future capacity of county revenues to fund its core programs. While this hpd/tif has what appears to be good intent and certainly there is absolutely a need to pursue affordable housing, it also seems to be sensible to honor the staff's concern that due diligence is first needed to ascertain that this is indeed the best program. I would like to encourage each of you to vote to defer any action on the agenda item, including the resolution of interest in working with the city which is in the current draft. Which in its current draft reads more to me like a resolution of intent, until such time as the county staff has had adequate opportunity to do due diligence and to make solid recommendations to the court. Thank you for your consideration of this request, sincerely Karen huber.

>> thank you. And based on what Commissioner Daugherty just stated, he would like to see that Commissioner have an opportunity and I would like to see the Commissioner have the same opportunity and I would like staff to do the necessary due diligence which they stated is not enough time to come up with this before the end of the year. So my motion is to delay this and defer this until we're able to have staff to report back to the court with all the due diligence, which is going to go beyond the December 31st date. There's no doubt about it. There's not enough time. Staff has even said that in their particular proposal. That's what my motion is to do just that.

>> that's a substitute motion. That is a substitute motion. Is there a second? That substitute motion dies for lack of a second. All in favor of the original motion? Show Commissioners eckhardt, Gomez, Daugherty and yours truly voting in favor. Commissioner Davis?

>> I oppose based on --

>> that means he votes against it. Sorry to take so long but I think the time was well spent and let's see if we can advance the ball.

>> Commissioners, judge, thank you for your time today and want to wish you a happy thanksgiving.

>> you as well.

>> now city councilmembers, since we have you here --

>> turn right back around and sit down.


The Closed Caption log for this Commissioners Court agenda item is provided by Travis County Internet Services. Since this file is derived from the Closed Captions created during live cablecasts, there are occasional spelling and grammatical errors. This Closed Caption log is not an official record the Commissioners Court Meeting and cannot be relied on for official purposes. For official records please contact the County Clerk at (512) 854-4722.


Last Modified: Tuesday, November 25, 2008 7:36 PM