Preserving Affordable Apartments in Austin

Transcription

1 Preserving Affordable Apartments in Austin Case Study Analysis of the East Riverside/Oltorf Combined Neighborhood Planning Area Michelle Ng, Chris Grant, Rosa E. Donoso, and Sharlene Eaton CRP388 Affordable Housing Policy in the United States Spring 2007 Professor Elizabeth Mueller

2 The University of Texas at Austin School of Architecture - UTSoA Preserving Affordable Apartments in Austin: Case Study Analysis of the East Riverside/Oltorf Combined Neighborhood Planning Area Michelle Ng, Chris Grant, Rosa E. Donoso, and Sharlene Eaton Michelle Ng, Chris Grant, Rosa E. Donoso, Sharlene Eaton, 2007 Published by: Center for Sustainable Development The University of Texas at Austin School of Architecture 1 University Station B7500 Austin, TX Table of Contents pg All Rights reserved. Neither the whole nor any part of this paper may be reprinted or reproduced or quoted in any form or by any electronic, mechanical, or other means, now known or hereafter invented, including photocopying and recording, or in any information storage or retrieval system, without accompanying full bibliographic listing and reference to its title, authors, publishers, and date, place and medium of publication or access. Contact: Michelle Ng mdng@mail.utexas.edu, Christiane Grant skyedreame@hotmail.com, Sharlene Eaton sharlene.eaton@gmail.com, Rosa E. Donoso rosalenadonoso@yahoo.com I. Introduction 3 II. Project Methodology 6 III. Overview of Affordable Housing Stock 7 in Riverside in Austin IV. Planning for the Growth of Austin 9 1. Vertical Mix Use (VMU) Transit Oriented Development Corridor Planning 20 V. Trends 23 VI. Riverside Analysis: From Multi-Family 30 to Mix-Use Zoning VII. Conclusion 37 VIII. Bibliography 42 IX. Apartments Fact Sheets 43 X. Appendices 65 List of Tables pg 1.1 City of Austin Population Renter Households by Income Categories Units by Monthly Rent Categories Rental Unit Shortage Median Household Incomes for Selected 39 Census Tracts Converted to a Percent of Median Household Income for the City of Austin, 1999

3 The University of Texas at Austin School of Architecture - UTSoA List of Figures pg 1. Map of Vertical Mixed Use Application Process Map of Transit Oriented Development Districts Map Showing Riverside as one of the 22 Candidate Corridors 4. Size of the Hispanic/Latino Population Median Household Income Percent of Families Living Below the 28 Poverty Level 7. Percentage of Total Units by Tenure Riverside Area Zoning Map Riverside Area Zoning Map Boundaries of the East Riverside/Oltorf 33 Combined Planning Area 11. East Riverside/Oltorf Combined Neighborhood 35 Plan. Future Land Use Plan (FLUM), City of Austin 2007 List of Appendices pg 1. Source 1: Profile of General Demographic 65 Characteristics Data Set: DP1 US Census Source 2: Profile of Selected Social Characteristics Data Set: DP2 US Census Source 3: Profile of Selected Economic Characteristics Data Set: DP3 US Census Source 3: Profile of Selected Housing Characteristics Data Set: DP4 US Census Map: HUD Qualified Census Tracts 69 Austin, Texas, 2004 Tract. Set 6. Map: East Riverside/Oltorf Neighborhood 70 Planning Area: Year of Construction for Multifamily Developments 7. Map: Map of Transit Oriented Development 71 Districts 8. Map: East Riverside/Oltorf Combined Planning 72 Area 9. List of Class C Apartments, Austin Investor 73 Interests 10. Map: Class C Apartments, Austin Investor 74 Interests 11. Property Summary, For 22 Class C apt. 75 Austin Investor Interests 12. Austin Riverside Class C Apartment Survey- 76 Spread Sheet 13. Austin Riverside Census Track Data 77

4 I. Introduction The availability of affordable housing is a key issue in most metropolitan areas of the United States. In the 1949 Housing Act, Congress declared its goal of a decent home in a suitable living environment for every American family. 1 Since this declaration, the United States has enacted a number of policies and programs to make decent and affordable housing available to low-income Americans. The provision of housing is crucial because it affects so many aspects of day-to-day life and has direct impacts on health and safety. The issue of housing affordability has been an increasing problem; in 2003, nearly 25 percent of all homeowners and more than 40 percent of all renters spent at least 30 percent of their income on housing million households spent 50 percent or more of their income on housing, incurring a severe cost burden. 3 These cost burdens fall disproportionately on low-income households, with the bottom quartile of the income distribution accounting for 93 percent of all renters with severe cost burdens and 66 percent of all homeowners with severe cost burdens. 4 The need to preserve the existing affordable housing stock has become an increasingly important matter, especially as federal government subsidies have fallen short of meeting the need for affordable housing. The City of Austin is hailed as the Live Music Capital of the World and in recent years has been nicknamed Silicon Hills because of its booming technology sector. Austin is also the state capital and the home of the University of Texas; its growing population includes university professors, students, politicians, lobbyists, 1 Schwartz, Housing Policy in the United States, 1 2 Schwartz, 27 3 Mueller and Schwartz, Can State and Local Governments..?, 3 4 Schwartz, 28 3

5 musicians, high-tech workers, as well as a number of service sector employees. Austin s population has seen a steady increase over the past 60 years and this growth is projected to continue, placing additional demands on the limited housing supply. Table 1.1 City of Austin Population Annual Growth Year Population Rate , , % , % , % , % , % , % , % , % , % , % , % , % , % , % , % , % , % , % , % , % ,052, % ,147, % ,236, % ,315, % Source: Ryan Robinson, City Demographer, Department of Planning, City of Austin. December In addition to increasing demand pressures in the housing market, there have also been pressures on the supply of affordable housing. As Austin implements plans to increase densities in the urban core and around key transit corridors, there is increasing 4

6 pressure to turn older units of unsubsidized affordable housing into more profitable development. Since most low-income households do not receive housing subsidies, these affordable units of housing are a critical element of the lower end of the housing market. Without these older properties on the market, many lower income households would not be able to afford to live in Austin or in other metropolitan areas where gentrification and high housing demand have driven prices up. These existing affordable units represent a key irreplaceable element of the housing market supply. One avenue of action that housing advocates have pursued to maintain the stock of affordable housing is policy-making. In order for advocates and policy makers to effectively approach the housing problem, they must have an accurate assessment of the scope and nature of the issue at hand. Our project examines the overall stock of Class C apartments in Austin, taking a more in-depth look at the Riverside Area as one of the areas in Austin most vulnerable to redevelopment pressures. Our project seeks to provide an overview of the affordable housing stock in the Riverside Area, while analyzing their vulnerability with respect to the zoning policies and redevelopment practices being implemented in Austin. This project serves as a template that can be expanded to include other areas of the City of Austin as well as other cities; our methodology may be helpful for advocates and policy-makers to apply to the assessment of their own affordable housing markets across the United States. 5

7 II. Project Methodology We began our research by conducting a series of informational interviews with representatives from various agencies associated with affordable housing, zoning, and planning in Austin. We interviewed the following people: Ryan Robinson, City of Austin Demographer Frances Ferguson, Chair of HousingWorks Board and Director of NeighborWorks Multi-Family Initiative Heather Way, Lecturer, University of Texas at Austin School of Law Sonya Lopez, City of Austin Neighborhood Planning and Zoning Department Melissa Laursen, City of Austin Neighborhood Planning and Zoning Department Jan Long, President of Riverside/Oltorf Neighborhood Planning Community Contact Team These conversations informed our approach to the project and made it clear that we should focus on the Riverside Area as a key redevelopment corridor. Because of the zoning changes that are occurring in the Riverside Area as well as the neighborhood s proximity to a future planned transit corridor, key parcels in the neighborhood are especially vulnerable to redevelopment, as investors see these properties as not capturing their full development potential. The interviews we conducted were also helpful in helping us to get a more complete picture of the direction of future planning and development in Austin. We obtained a list of Austin s Class C Apartments from Austin Investor Interests and created a database of the apartments located in the Riverside Area (See appendices 9, 10, and 11). We also obtained Census data about the zip code and census tracts that these properties are located in and compared this data to citywide and national statistics (See Figures 4 through 7). Our interviewees were also able to provide us with a number of helpful maps that highlighted potential vertical mixed use and transit oriented 6

8 development corridors as well as zoning changes. Some of the characteristics that we examined were each parcel s specific zoning, number of units, occupancy rate, rent, size, year built, when the apartments were renovated, whether the property is currently for sale, types of units that the structures contain, and percentage of students. After compiling all of this information, we examined the data and maps to assess the vulnerability of specific properties. III. Overview of Affordable Housing Stock in Riverside and Austin In order to get a better understanding of the pressures in the Riverside Area as well as in the Austin housing market in general, we analyzed the number of households and number of units in four income ranges- extremely low (0-30 percent of median household income), very low (31-50 percent of median household income), low (51-80 percent of median household income) and moderate ( percent of median household income). In 2005, there were 3,864 units affordable to extremely low income households in Austin and 18,444 units affordable to very low income households, a decrease in the number of units from the 2000 figures. The numbers of units affordable to low income and moderate income households were slightly higher than they had been in When comparing the number of units available to the number of households in each income category, there was a disturbing shortage of 30,721 in the extremely-low income range. This is especially worrisome for extremely low income households because there are not cheaper units available for them to consume. If this type of shortage occurred in a higher income category, households could choose to spend less than 30 percent of their income on housing and occupy units affordable to lower income 7

9 groups. Extremely low income households do not have this option. While small surpluses exist for some of the other income groups, especially for the low income households category, this is not enough to accommodate the growing population and to cover the losses that would be incurred by extensive redevelopment of affordable housing complexes. Table 3.1 Renter Households By Income Categories % MHI - Extremely Low 20,598 34, % MHI - Very Low 22,934 12, % MHI Low 38,239 38, % MHI - Moderate 25,552 30,351 Source: Census 2000, 2005 American Communities Survey Table 3.2 Units By Monthly Rent Categories % MHI - Extremely Low 5,925 3, % MHI - Very Low 22,068 18, % MHI - Low 79,088 81, % MHI - Moderate 27,342 36,189 Source: Census 2000, 2005 American Communities Survey Table 3.3 Rental Unit Shortage % MHI - Extremely Low -14,673-30, % MHI - Very Low , % MHI - Low 40,849 42, % MHI - Moderate 1,790 5,838 Source: Census 2000, 2005 American Communities Survey It should be noted that the data on Class C Apartments received from Austin Investor Interests LLC does not include apartments with less than 50 units. This means that a considerable number of developments are left out of our analysis and these units may comprise a considerable share of the overall affordable housing market. Data from 8

10 the Census and from the American Communities Survey captures these units in its data and is included in our mismatch analysis. While redevelopment of parcels that contain apartments with 50 or more units represents an especially large blow to the stock of affordable housing in Austin, attention should also be paid to the smaller units, which collectively are also an important part of the existing stock. The current stock of Class C apartments is clustered along I-35 and Highway 183. These areas represent some of the less wealthy neighborhoods in Austin. Very few Class C apartments are located in more wealthy areas such as Westlake and areas further west of I-35. The concentration of Class C apartments in these areas is largely due to the fact that these neighborhoods are older, minority neighborhoods. Similar to other urban areas across the country, Austin experienced white flight and a general disinvestment in the central city, leading to its deterioration and an influx of minority residents. These areas remain some of the poorer areas in Austin and as the city attempts to reinvest and redevelop these neighborhoods, there is a conflict between keeping these areas affordable to current residents and improving the overall quality of life in the city. IV. Planning for the Rapid Growth of Austin Austin and the surrounding Central Texas region are experiencing rapid growth in population, employment, and land area affected by development. In addition to the rapid population growth previously discussed, programs such as the Austin City Council Smart Growth Initiative (adopted in 1997), and Envision Central Texas (founded in 2002) are likely to affect future growth and development in the Austin region. The Austin City Council Smart Growth Initiative and Envision Central Texas seek to manage and direct 9

11 growth in such a way that would minimize damage to the environment, prevent sprawl, protect Austin s water supply, encourage restoration of the central city, and promote mixed use development and the use of public transit systems. In addition to these growth management plans, the City of Austin s design guidelines (implemented January 13, 2007), outlined in Subchapter E: Design Standards and Mixed Use, consist of programs and policies designed to manage and direct growth in such a way that would cater to peoples desire to live near downtown. While these plans, programs, and policies have many environmental, economic, and social benefits, they may also have an adverse effect on the supply of affordable housing in the areas where they are applied, imposing additional threats to the already tenuous supply of affordable housing. In this paper, we will focus on the potentially threatening effects of Vertical Mixed Use (VMU) development, Transit-Oriented Development (TOD), and Corridor Planning. 1. Vertical Mixed Use (VMU) In order to accommodate the rapidly growing population, Austin has adopted a number of zoning policies that allow for increased density. One element of Austin s recently adopted design guidelines is the approval and encouragement of mixed use development projects which integrate two or more land uses with a strong pedestrian orientation. 5 VMU is a new zoning category that seeks to encourage redevelopment in the central city and stack several uses (residences, shops, businesses, restaurants) on one site. 6 Current mixed use zoning allows for different uses in one building but VMU adds 5 City of Austin Subchapter E, 66 6 Gregor 10

12 the additional requirement of residential units. 7 Some VMU requirements are that VMU buildings must have different uses on the ground floor and upper floors, must contain residential dwelling units, and must be designed for some commercial uses. 8 In order to define where VMU projects may be built, the city has established Vertical Mixed Use Overlay Districts (VMU-OD). In order to make VMU projects more attractive to developers, Austin has also relaxed certain standards and requirements for VMU projects. These include lifting the minimum site area requirements restricting density, reducing the amount of parking required by 60 percent, and allowing for more commercial uses on the ground floor. 9 The result is that more of the site can be used for the project, increasing the square footage available for residential and commercial development. The opt in, opt out process is a means by which neighborhoods may make recommendations to the Planning Commission and City Council on the locations of VMU buildings and the availability of relaxed development standards. A neighborhood with properties in a VMU-OD may request for some or all of the properties to opt out of some or all of the relaxed development standards. If the request is approved, buildings must comply with the base zoning district and minimum site area requirements in the Mixed Use combining district. Otherwise, the relaxed standards will apply, providing incentives for developers to undertake VMU projects. In addition, neighborhoods that wish to allow VMU buildings on properties that are not eligible for VMU may submit an 7 Dunbar 8 Austin Neighborhoods Council Summary of VMU and Neighborhood Options, 1 9 Gregor 11

13 opt in application to allow for such development. 10 Another opt in, opt out option is that neighborhood associations or planning teams may request that the affordable rental units be available to renters earning a lower percentage (as low as 60 percent) of the Annual Median Family Income. 11 On March 5, 2007, the City of Austin gave notice to Neighborhood Planning Teams that they have 90 days (until June 4, 2007) to submit their recommendations for the application of the VMU-OD. The city will then have 45 days to act on these recommendations and delineate final zoning on these parcels. While some neighborhoods may find it desirable to opt in to VMU incentives in order to improve under-utilized properties, other neighborhoods may find it desirable to opt out for a variety of reasons. Some neighborhoods may dislike change and increased density, or may be interested in the preservation of historic or cultural landmarks, environmental issues, and the protection of local businesses. 12 In order to receive the relaxed standards of VMU, developers must meet specific requirements, including high quality building design, meeting-the-street, pedestrianfriendly amenities, and green building methods. 13 There are also affordability requirements for both owner-occupied and renter-occupied units. Focusing on rental units, 10 percent of the project s units must be reserved as affordable to households earning no more than 80 percent of the Annual Median Family Income for a minimum of 40 years following issuance of certificate of occupancy. 14 Additionally, the city may subsidize an additional 10 percent of the units in the building for rental to residents at any 10 City of Austin Subchapter E, City of Austin Subchapter E, Gregor 13 Gregor 14 City of Austin Subchapter E, 75 12

14 level of affordability. 15 Affordable is defined by a household being required to spend no more than 30 percent of its gross monthly income on utilities and mortgage or rental payments. 16 While the relaxed standards of VMU certainly provide some incentives for developers to undertake VMU projects, it remains to be seen whether or not these incentives will be enough to provide units that are truly affordable. The 80 percent of Annual Median Family income standard is a relatively shallow target, which has been cause for criticism among affordable housing advocates. In addition, developers must see these VMU projects as profitable or the incentives will go unutilized. One developer was quoted as saying Affordable housing that s fine. But at the end of the day, if there are no profits, no one s going to do it City of Austin Subchapter E, City of Austin Subchapter E, Gregor 13

15 Figure 1. Map of Vertical Mixed Use Application Process Source: City of Austin Website-Vertical Mixed Use Opt-in Opt-out Process < ftp://coageoid01.ci.austin.tx.us/gis- Data/planning/maps/CommercialDesign/VerticalMixedUseColorMap.pdf> 14

16 2. Transit-Oriented Development (TOD) Central Texas is making long-term investments in rail and bus rapid transit systems with the implementation of Capital Metro s All System s Go long-range transit plan (See figure 2). The plan includes Capital MetroRail, Capital MetroRapid, expanded Local and Express bus services, more Park & Ride locations, and possible future rail services in Central Texas. In November 2004, voters within the Capital Metropolitan Transportation Authority service area approved the construction of a 32-mile commuter rail line connecting Austin and Leander, with service scheduled to begin service in early VMU goes hand-in-hand with TOD in that VMU zoning provides a means to increase density in areas where the city invests in transit development. TOD is a development pattern designed to support transit and increase ridership of publicly funded transit investments, while reducing reliance on automobiles, managing congestion, and improving air quality. The logic behind such an ordinance in Austin is that if the city wants Capital Metro s mass transit particularly the commuter rail line approved by voters in November 2004 to be efficiently used, then the mass needs to be near the transit. 18 This is accomplished through public-private partnerships and market responsive development near rail stations and bus lines. TOD is characterized by walkable streets that promote mixed use development, the design of quality public spaces, interaction between individuals and the community, buildings that engage pedestrians, and limited parking. Wide streets that perpetuate automobile use and pose great danger to pedestrians are discouraged. In addition, segregated, singe use zones like single-family subdivisions, multi-family projects, 18 Nichols 15

17 shopping centers, and office parks are not an element of TOD. The rigid separation of housing based on residential type and cost is also discouraged. TOD promotes buildings of minimum or average density, height, massing, and scale, along with the creation of neighborhoods ranging in use and type. TOD also prefers limiting the size, location, and design of buildings as opposed to strictly separating uses. In terms of careful transit integration, the most active, intense uses should be closest to transit stations, and there should be strong pedestrian connections and high quality public spaces and environments located between transit stations and development. Ultimately, TOD is expected to foster economic development and enhance the tax base and income from public-sector real estate assets. The TOD Ordinance was adopted by the Austin City Council on May 19, 2005 to plan for development around future commuter rail stations. 19 Phase I of the creation of the ordinance consisted of developing TOD districts around future Urban Commuter Rail stations and a Bus Rapid Transit Park and Ride facility. Austin has seven TOD districts, demonstrating the city s desire to put as many potential mass transit users within quick walking or bicycling distance of the rail stations as possible. 20 There are four types of TOD districts, which differ in location as well as the allowable level of density. Neighborhood Center TOD s are located at the commercial center of a neighborhood and are of the lowest density classification. Town Center TOD s are located at major commercial, employment, or civic centers while Regional Center TOD s are located at juncture of regional transportation lines or at major commuter or employment centers. Downtown TOD s are located in highly urbanized 19 City of Austin TOD Ordinance, 1 20 Nichols 16

18 area and are of the highest density. 21 Each TOD district is further divided into zones that establish the intensity or scale of development. These zones are the Gateway zone, the Midway zone, and the Transition zone. The Gateway zone is the area immediately surrounding the station platform and allows for the highest density. The Midway zone is the area between the Gateway and Transition zones and includes residential, retail, and office uses. The Transition zone is the area at the periphery of the TOD district, is mostly comprised of residential uses, and is of the lowest density. 22 Phase II of the TOD Ordinance is still underway and involves the preparation of station area plans (SAP s) for each district. SAP s contain a land use strategy, urban design standards, zoning recommendations, affordability standards, and implementation strategy. The Neighborhood Planning and Zoning Department has hired Parsons Brinckerhoff Quade and Douglas, Inc. to conduct station area planning activities for each district. In addressing the affordability of rental units, SAP s will include a housing affordability analysis and feasibility review. These documents describe potential strategies for achieving the goal of providing 10 percent of the units to households with an income of not more than 40 to 60 percent of Annual MFI, 10 percent of units to households with an income not more than 30 to 40 percent of MFI, and five percent of units to households with an income of not more than 30 percent MFI. 23 Despite the discussion of these strategies, there is concern that not enough provision has been made for affordable housing and that gentrification will increase property values of 21 City of Austin TOD Ordinance, 2 22 City of Austin TOD Ordinance, 3 23 City of Austin TOD Ordinance, 9 17

19 neighborhoods to the point where the people already living there will not be able to afford it Nichols 18

20 Figure 2. Map of Transit Oriented Development Corridors Source: City of Austin Website-Neighborhood Planning and Zoning: Transit-Oriented District < 19

21 3. Corridor Planning As mentioned earlier, VMU projects may be built in Vertical Mixed Use Overlay Districts. These districts consist of commercially zoned frontage properties along Austin s 16 core transit corridors (CTC s) and 11 future CTC s. CTC s are major, wellpopulated, developed 1 to 2.5 mile long roads along which the city wants to direct growth and encourage public transit use. 25 (See figure 3) Most CTC s were initially developed to accommodate automobiles, so they have large parking lots, narrow sidewalks, large unattractive signs, and a generally unappealing and dangerous environment. 26 In order to redirect Austin s growth away from sprawl and back to the central city, the Smart Growth Initiative advocates redevelopment along CTC s with a mix of uses, such as retail, office, restaurant, and residential, along with improved landscaping and amenities. Austin s Corridor Planning Program is meant to complement Neighborhood Planning by making long-term, coordinated transportation and land use choices before new Austin residents overwhelm unprepared neighborhoods, corridors, and the infrastructure they rely upon. 27 The purpose of the Corridor Planning Program is to enhance corridors as the physical and cultural pathways that link people to each other, to local institutions, and to daily destinations. The focus of the program is on Traditional Neighborhood Corridors that have sufficient right-of-way with public space, access to several transportation modes, potential to be pedestrian friendly, and a width of at least 70 feet. While VMU supports TOD initiatives to increase density in the central transit areas of Austin, Corridor Planning helps to coordinate land use, transportation, and infrastructure 25 Gregor 26 City of Austin Smart Growth Website 27 City of Austin Corridor Planning Guidebook, 2 20

22 planning to build consensus among stakeholders about how the street should look and function. Stakeholders who make up Corridor Planning Teams include business owners, drivers, residents, pedestrians, and other community members. City staff assists the teams by providing information, such as demographics, maps, and zoning data in order to assist with the consensus-building process. The Corridor Planning teams have a very important job because use of public transit, such as those associated with the new Capital Metro plans, increases if corridors are perceived as safe and attractive. Corridors will be also be greatly affected by both VMU and TOD. The Transportation, Planning and Sustainability Department has identified 35 candidates for Corridor Planning. There are several types of corridors in Austin. Town Center Corridors include a mixed-use destinations that attract people from across the city for the purposes of entertainment and shopping. Main Street Corridors are characterized by the presence of commercial and retail activity along the corridor and quality improvements in pedestrian and transit accommodations. Neighborhood Village Corridors include a diversity of residential uses and are located along streets that are narrow and carry less traffic, serving mainly as links between homes and shops or other public places. Gateway Corridors are visual entranceways to important landmarks, such as downtown. New Urban Corridors are located in underdeveloped or newly developing areas in the city s urban core and are characterized by vacant developable land. Several Corridors are identified as Planning Work in Progress because either the Austin Revitalization Authority or the Robert Mueller Municipal Airport redevelopment effort is developing corridors. 21

23 Once a Corridor Plan has been adopted by the City Council, it is implemented. This may require zoning changes, capital investment projects, coordination with adjacent Neighborhood Planning Teams, and publicity. A particular CTC that was mentioned time and again during our interviews with City of Austin officials was Riverside Drive west of Pleasant Valley Road. Below is a portion of Appendix A: Maps of Urban Core Candidate Corridors from the Corridor Planning Guidebook for the City of Austin. Riverside Drive is highlighted as a Town Center Corridor candidate. Figure 3. Map Showing Riverside as one of the Candidate Corridors Source: Appendix A: Maps of Urban Core Candidate Corridors, Corridor Planning Guidebook, City of Austin, Transportation, Planning, & Sustainability Department, March 2001 (January 2003 Update) 22

24 V. Trends In order to assess the vulnerability of specific properties and census tracts in the Riverside Area, we analyzed census data and zoning policies, looking for trends and differences from both city-level and national data (See appendices 1-4, 12 and 13). Identifying these key differences allowed us to determine the extent to which the Riverside Area might be targeted as a key redevelopment area. There are a total of 284 Class C apartments in Austin. 150 of these apartments were built prior to 1980 and 70 buildings have been renovated since 1992 (See appendix 6). Approximately 95 percent of these apartments have one-bedroom units, with a similar percentage of apartments containing two-bedroom units. Only 20 percent of these apartments have three-bedroom units and 30 percent of these apartments have studio units. It is interesting to note that the low percentage of apartments containing threebedroom units, which may provide a constraint to the housing of families. There are two possible explanations for the low percentage of three-bedroom units. The first is that there is not a need for many three-bedroom units in the Riverside Area because the demographic has a relatively small share of families compared to the national and city average. The second possibility is that the lack of units large enough to accommodate families causes families to locate in other areas. According to census data, the percentage of family households in these census tracts is relatively low compared to the United States. The average household size and average family size do not differ significantly from the national and city averages, but this data may be skewed by the number of students living in the Riverside Area. This is 23

25 reflected in the number of households with own children under 18 years which is relatively small in these census tracts compared to the national and city data. Also of note is the median age of individuals in the Riverside census tracts compared to the nation and the city median ages. The median age in the United States is 35.3 years and the Austin median age is 29.6 years. The median age in four of the census tracts we examined , 23.14, 23.15, and were significantly below the national and city-level statistics, with averages of 24.5 years, 24.3 years, 23.2 years, and 23.7 years respectively. This is another indication that there may be a high percentage of students living in these census tracts, especially given the relatively cheap rents and proximity to the University of Texas campus. This assumption is reinforced when looking at the percentage of the population enrolled in college or graduate school. The percentage in Austin is nearly double the national average and the percentage in all five of the census tracts we examined was much higher than the city average. Despite the high number of college and graduate students in these census tracts, the overall educational attainment of residents over the age of 25 in these census tracts was generally very low compared to both national and city averages. The percentage of individuals with less than a 9 th grade education level was 25.4 percent in Census tract and 19.3 percent in Census tract 23.16, compared to the national average of 7.5 percent and the Austin average of 8.3 percent. These same census tracts had especially low percentages of individuals with a high school diploma or higher. Compared to the national and Austin averages of 80.4 percent and 83.4 percent respectively, Census tract only had 54.8 percent of individuals with a high school diploma or higher and 24

26 census tract only had 63.3 percent. Since educational attainment is directly tied to access to jobs and housing, these demographic figures are especially troubling. Another characteristic that we examined was race. There were drastic differences between national, city, and census-tract wide data in the percentage of individuals who classified themselves as some other race. The United States percentage of individuals claiming some other race is 5.5 percent, while the Austin average is 16.2 percent. Census tract was very similar to the Austin average with 16.1 percent claiming some other race while the other four census tracts had drastically different percentages, at 37 percent, 22 percent, 28 percent, and 29.8 percent. The percentages of individuals classified as white was also significantly lower in these census tracts, which suggests that the racial composition in Census tracts 23.04, 23.14, 23.15, and is largely minorities. However, one uncertainty is how Hispanics are counted, since this is not one of the race categories. Hispanic individuals may classify themselves as white or may classify themselves under some other race. Without clarification, it is impossible to tell whether the current data over-represents or under-represents the minority makeup of these communities. However, from more detailed census data, we can tell that these census tracts have a large Hispanic population, ranging from three to five times the national average. 25

27 Figure 4. Size of the Hispanic/Latino Population The median household income of four of the five census tracts we examined was extremely low (See figure 5). The national average is $41,994 and the Austin average is 42,680. Census tracts 23.04, 23.14, 23.15, and had especially low median household incomes of $27,551, $23,786, $22,363, and $21,411. While Census tract has a relatively high median household income, its renter-occupied household income falls in line with that of the other census tracts, at $27,330. The high owneroccupied household income skews the median income in this tract. Since income affects a household s abilities to pay rent, the especially low median household incomes further reinforce the need to maintain the affordable stock in this area. The existing affordable housing stock represents a crucial element of the supply of housing that serves as a viable option for these low-income households. 26

28 Figure 5. Median household income (dollars) It is also troubling to note that here are a significant number of families below the poverty level in Census tracts and 23.16, with 21.5 percent and 29.6 percent compared to the national average of 9.2 percent and the city average of 9.1 percent (See figure 6). Similarly high numbers occur in the same census tracts for the percentage of families with a female householder. Among these single mother households, Census tract has a staggering 75.5 percent below the poverty level, which is especially troublesome. While the income figures in the census tracts we examined undoubtedly indicate that a substantial number of low-income households reside in the Riverside Area, it should be noted that these income figures may be skewed by the number of students in the area. 27

29 Figure 6. Percent of Families Living Below the Poverty Level The percentage of apartments with 20 or more units is also extremely high in the census tracts we examined. The national average is 8.6 percent and the Austin average is 20.7 percent. The averages of the census tracts we examined are 37.4 percent, 62.6 percent, 40.9 percent, 46.7 percent, and 56 percent. Apartments with 20 or more units are likely to be affordable to lower-income households, making an additional argument for the preservation of these buildings. With respect to the occupancy of the Class C apartments in these census tracts, there are also significant differences from national and citywide data. The percentage of occupied units is significantly higher in the city and in these census tracts than in the rest of the nation, suggesting that the housing market in Austin is rather tight. This poses additional affordability problems. In terms of the occupied housing units (See figure 7), the units in four of the five census tracts for which we have data are staggeringly renter-occupied. The national 28

30 percentage of renter-occupied housing units is 33.8 percent and the city average is 55.2 percent. Census tracts 23.04, 23.13, 23.15, and have percentages of 99.7 percent, 97.4 percent, 94.2 percent, and 99.2 percent respectively. There is an extreme reliance on rental units in the Riverside Area. Figure 7. Percentage of Total Units by Tenure Gross rent as a percentage of household income is another important characteristic to examine. The percentage of renters expending 35 percent or more of their income is significantly higher in the Riverside Area than in the city and nation. More than half of renters in Census tracts and spend 35 percent or more of their income on rent, compared to a national average of 29.5 percent and a city average of 33.5 percent. Part of this may be explained by high median rents in the city of Austin as well as by the high percentage of households using electric gas as their primary house 29

31 heating fuel. Since electric bills are often not included in rent, this can be an extra cost incurred under gross rent. An additional characteristic of the housing market is the number of occupants per room. Again, the selected census tracts have abnormally high percentages of households with 1.51 or more occupants per room. The national average is 2.7 percent and three of the five census tracts have percentages in the double digits. The number of occupants per room is a measure of the quality of an individual s housing experience. A crowded living space may indicate a shortage of larger affordable units or may indicate that high rents must be compensated for by crowding more occupants into a unit. Either way, the quality of life declines as more occupants are crowded into a small space. By examining census data from the Riverside Area and comparing it to both city and national statistics, it became evident that the neighborhood s affordable housing stock houses a large number of low-income households. Both Riverside renters and the units in which they reside represent an especially vulnerable segment of the housing market. VI. Riverside Analysis: From Multi-Family to Mixed Use Zoning Riverside Drive is an important commercial center and a gateway to both downtown Austin and the Austin Bergstrom International Airport. Unfortunately, it is lacking in services to local residents, and is characterized by strip malls, vacated retail space, and parking lots. The majority of Riverside residents rely on public transportation. Corridors like Riverside Drive are seen as opportune locations for developing mixed use, transit-oriented neighborhoods, generating pressure to change their zoning and land use 30

32 codes to accommodate these goals. As was mentioned previously, Mixed Use zoning is often used hand-in-hand with TOD ordinances. After determining that the area surrounding the Riverside CTC is one of the neighborhoods under the greatest development pressure, we compared current land use and zoning maps for the surrounding neighborhoods with future land use maps (FLUM s) in order to assess the effect that development will have on areas that are currently zoned for multi-family use. We also referenced the East Riverside/Oltorf Combined Neighborhood Plan in order to relate the zoning changes to the written plans (See Figure Figure 8. Riverside Area Zoning Map 2006, Source: City of Austin 31

33 Figure 9. Riverside Area Zoning Map 2007, Source: City of Austin, FLUM map. The purpose of a neighborhood plan is to create a long-range vision for an area that will guide future development. The plan is often used as a reference to make recommendations for issues such as land use, zoning, transportation, and urban design. The East Riverside/Oltorf Combined Neighborhood Plan Area (NPA) (See figure 10, and appendix 8) is comprised of three planning areas totaling 3358 acres: Riverside, Parker Lane, and Pleasant Valley. These areas were selected for neighborhood planning by the Austin City Council in The Riverside Planning Area (745 acres) is bounded on the east by Pleasant Valley Road, on the south by Oltorf Street, on the west by IH-35, and on the north by Town Lake. The Pleasant Valley Planning Area (1476 acres) is bounded on the east by Grove Blvd, on the west by Pleasant Valley Road, on the south by Oltorf 32

34 Street, and on the north by Town Lake. The Parker Lane Planning Area (1136 acres) is bounded on the east by Montopolis Road, on the south by Ben White Blvd/Highway 71, on the west by IH-35, and on the north by Oltorf Street. The Combined NPA is bound on the east by Grove Blvd and Montopolis Road, on the south by Ben White Blvd/Highway 71, on the west by IH-35, and on the north by Town Lake. Figure 10: Boundaries of the East Riverside/Oltorf Combined Planning Area Source: The East Riverside/Oltorf Combined Neighborhood Plan. The Austin Tomorrow Comprehensive Plan, Chapter 5, Section 5-21, Exhibit A. November 33

35 To analyze changes occurring in the Riverside area, we first compared the current land use maps to the FLUM for the Combined NPA. The FLUM incorporates the neighborhood plan s main land use goals and principles and is meant to serve as a guide to future land use and zoning changes. If a requested zoning change does not correspond with adopted land use, the neighborhood plan will need to be amended with the input and official response of a Neighborhood Plan Contact Team (NPCT). An NPCT is a group consisting of property owners, renters, business owners, and neighborhood associates who are given the task of upholding the vision and goals of their particular neighborhood plan. It is specifically stated that because of the overwhelming proportion of multifamily in this NPA, uses such as office, retail, condominium, and townhouses are all preferred to any multi-family uses, which sets the stage for development that does not support multi-family land use. 28 In general, the application of Mixed Use is applied in the FLUM to reflect the desire to redevelop with projects that are pedestrian-friendly, convenient, and attractive. Along with the addition of Mixed Use combining districts to base zoning, the FLUM indicates a desire for future Mixed Use redevelopment available as the Mixed Use Building (MUB, similar to VMU in that it prescribes the mix of commercial and residential in one building structure) and the Neighborhood Urban Center (NUC, which permits redevelopment of existing sites into Mixed Use, transitoriented centers). There are several areas where current zoning prescribes multi-family land use, but the FLUM indicates a change to Mixed Use or that the area has been withdrawn for future consideration. 28 East Riverside/Oltorf Combined NPA, 71 34

36 In the East Riverside/Oltorf Combined Neighborhood Plan, the authors give the impression that the planning area community contact team is averse to multi-family housing in the neighborhood. However, in an interview with Jan Long, president of the contact team, she stated that the neighborhood is not against multi-family housing; rather, it does not wish to increase density. In addition, the neighborhood representatives recognize that the existing multi-family housing is a critical source of unsubsidized affordable housing for the city. The Austin Neighborhood Planning and Zoning Department has described the current situation as a "multi-family problem that it hopes to solve through its multi-family tool. At the time of the interview, Long said that the City had yet to present the tool to the contact team, but the contact team anticipated that it would be VMU zoning. Figure 11. East Riverside/Oltorf Combine Neighbohood Plan. Future Land Use Plan (FLUM), City of Austin 2007 Currently, the Riverside NPA is the most developed and has the largest proportion of multi-family residential units of the three NPA s. At 85.3 percent of total 35

37 housing units in 2000, Riverside contained the highest percentage of multi-family units compared to Pleasant Valley s 80.9 percent and Parker Lane s 64.8 percent. 29 In addition, approximately 38 percent of Riverside s land use was multi-family in 2004, with Parker Lane s being 15 percent and Pleasant Valley s being about 24 percent. 30 The FLUM shows a change from commercial to Mixed Use and MUB along the south side of Riverside Drive, in addition to Mixed Use zoning on the properties north and south of Lakeshore Boulevard between Riverside Drive and Pleasant Valley Road that are currently zoned as multi-family. Of our properties, 12, 16, 13, 4, 7, 1, 21, 14, and 22 (a total of 2796 units), (See fact sheets) all fall within this area. This area accounts for at least 40 multi-family lots that will be changed to Mixed Use. In addition, all properties currently zoned for multi-family use west of Pleasant Valley Road between Riverside Drive and Oltorf Street have been withdrawn for future consideration or excluded from the neighborhood plan on the FLUM. According to the Combined Neighborhood Plan, it is not the desire of planning participants to see these lots develop entirely as residential since these are important locations that service the retail and office needs of the community, and a code amendment was approved for the mixed use combining district to allow for the prohibition of multi-family residential. 31 Of our properties, 2, 3, 6, 19, 11, 8, 5, 20, 9, 18, 15, and 10 (a total of 1523 units) fall within this area. This area accounts for at least 48 multi-family lots that have been withdrawn for future consideration or excluded from the neighborhood plan on the FLUM. 29 East Riverside/Oltorf Combined NPA, East Riverside/Oltorf Combined NPA, East Riverside/Oltorf Combined NPA, 74 36

38 The Parker Lane NPA contains a majority of single-family residential and industry land use. The FLUM indicates that there will be significant commercial development along the north side of Ben White/Highway 71. In general, most of the multi-family lots will be preserved as multi-family, with the exception of about 6 multifamily lots on the west side that have been withdrawn for future consideration. The Pleasant Valley NPA contains the most open park space, and a majority of its significant multi-family zoning will be retained, with the exception of about 6 multifamily lots that have been withdrawn for future consideration in the FLUM. Property 10 (168 units) falls into this area. Within the existing developed property in the CPA, 42 percent is multi-family, and 78.6 percent of housing is multi-family. 32 A change in zoning from multi-family to Mixed Use would be detrimental to the supply of multi-family housing in the area. VII. Conclusion While the Combined NPA for East Riverside/Oltorf contains many admirable goals, our concern is with the redevelopment of existing multi-family developments. According to the Combined Neighborhood Plan, there is an overabundance of multifamily development, which has contributed to traffic congestion, high crime, inadequate ownership, and inadequate infrastructure. Although the stated goal is to apply redevelopment tools that encourage provisions for affordable home rental, the provisions set aside to retain affordable housing are not sufficient for the present Riverside area population. 32 East Riverside/Oltorf Combined NPA, 26 37

39 For example, in the Combined Neighborhood Plan, there is an allowance for specific properties to be rebuilt with a requirement of at least 10% of the units being reasonably priced. 33 Unfortunately, this simply means that they would rent to households at or below 80% Median Family Income who spend no more than 30% of their gross income on rent and utilities. 34 As was mentioned earlier, VMU provides for 10% of project units to be reserved as affordable to households earning no more than 80% of the Annual Median Family Income. The following table illustrates the fact that these affordability requirements associated with Mixed Use are not sufficient for accommodating the population in our sample census tracts. In all of our sample census tracts, the Median Household Income for renters ranges from 48-64% of the Median Household Income. Clearly, the 80% requirement outlined in VMU will not meet the needs of these people. 33 East Riverside/Oltorf Combined NPA, East Riverside/Oltorf Combined NPA, 45 38

40 Table 4. Median Household Incomes for Selected Census Tracts Converted to a Percent of Median Household Income for the City of Austin, The Combined Neighborhood Plan for Riverside highlights specific properties designated for redevelopment in favor of Mixed Use and commercial and office options. Many of these properties correspond to our selected sample of apartment complexes: The Arbor 1500 Royal Crest, Barcelona I & II 2101 Elmont, Brookstone Apartments 2315 Town Lake Circle, Garden Oaks 2425 Elmont, Las Palmas Town Lake 39

41 Circle, London Square 2400 Town Lake Circle, and Vista Lago 2215 Town Lake Circle, Canyon Oaks 1708 Burton Drive and Lafayette Landing 1845 Burton Drive. 35 Of the 22 properties in our study, 13 of them accept Housing Choice Vouchers. These 13 properties account for 2,401 units of the 4,501 total units in our analysis, although it is unknown how many of the units within each property accept vouchers. Eight of these properties, which account for 1,285 units, are zoned for future consideration (FC), which means that these units are at high risk for redevelopment because the neighborhood plan does not have any specific zoning for these parcels. However, this zoning also represents an opportunity to preserve and increase the affordable housing stock as they can be zoned for multi-family or other higher density use. It is important to preserve the stock that accepts vouchers because without government subsidy, many voucher users would be unable to locate affordable units. Also, many older units, especially those constructed before 1978, are located in areas zoned FC, putting a large amount of the older housing stock in Riverside at risk. Since older units typically represent a reliable source of affordable housing for lower income households, this is especially troubling. Lastly, 21 of our properties are located on HUD Qualified Census Tracts, which presents an additional opportunity for developers to access government funding and tax benefits to pursue affordable housing and community economic development in this area. The loss of these properties from the stock of existing affordable housing would have negative effects on the lower end of the housing market in Austin. Since most lowincome families do not receive federal aid for housing, existing affordable units represent 35 East Riverside/Oltorf Combined NPA,70 40

42 a key element of the supply for these households. The stated goals of the NPA pose a major threat to these units and any development that takes the place of these apartments is unlikely to provide anywhere near the number of affordable units that currently exist. Thus, policy-makers and housing advocates must take care to ensure that affordable options continue to be provided for low-income households, whether that be through the preservation of affordable apartment buildings in the Riverside Area or through much more unlikely unit-for-unit replacement requirements. As Austin s population continues to grow, housing demand will also continue to increase, placing additional pressures on the market. It is imperative that the government and other local agencies approach this problem head-on to ensure that the basic need of shelter is met for low-income households in the Riverside Area and the rest of Austin. 41

43 VIII. Bibliography All Systems Go! Long-Range Transit Plan Website. Capital Metro. < City of Austin Smart Growth Initiative Website. < City of Austin TOD Ordinance No An Ordinance Amending Chapters 25-2 and 25-6 of the City Code to Add a New Zoning District Relating to Transit Oriented Development. Adopted 19 May < Corridor Planning Guidebook. City of Austin Transportation, Planning, & Sustainability Department. March 2001 (January 2003 Update). Dunbar, W. Design Standards: All Mixed Up. The Austin Chronicle. 11 August 2006: < Gregor, K. Going Vertical: the New VMU Zoning Could Transform Your Neighborhood and You ll Have 90 Days to Help Decide How. The Austin Chronicle. 9 February 2007: < Mallach, A. (2005). Preserving New Jersey s Affordable Private Rental Housing Stock: Creating A Framework for Action. Montclair, NJ: National Housing Institute. Mueller, E. and Schwartz, A. (2006). Can State and Local Governments make Housing Affordable to the Poor Without Federal Assistance?. Retrieved from University of Texas at Austin E-Reserves. Nichols, L. Here Comes the Train: Transit-Oriented Development Promises to Radically Reshape our Skyline. Is Austin Ready? The Austin Chronicle. 28 January 2005: < Subchapter E: Design Standards and Mixed Use. Amendment to the City of Austin s Land Development Code, based on the May 2005 Task Force Report: Raising the Design Standards in Austin, Texas. Adopted: August 31, Effective: January 13, < Schwartz, A. (2006). Housing Policy in the United States: An Introduction. New York, NY: Routledge 42

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