Austin’s Finally Putting Some Teeth in the Downtown Density Bonus Program

Image: Randy von Liski / Flickr Creative Commons

At its meeting earlier today, Austin’s City Council passed a resolution initiating a number of potential modifications to the city’s Downtown Density Bonus Program — that’s a set of optional guidelines first established in 2014 allowing developers to build taller and bigger buildings downtown in exchange for meeting various community benefit requirements, like pedestrian-friendly street designs, superior energy efficiency, and affordable housing. The resolution instructs Austin’s new city manager to research and develop a laundry list of potential changes to the DDBP, and return to Council with a final ordinance for consideration by spring 2025.

One Weird Trick for Fixing Downtown Austin’s Density Bonus Program

It’s a move we’ve been waiting to see for years at this point, but what’s on the table? Based in part on the findings of an Urban Land Institute report from earlier this year along with the policy goals of the recent Equitable Transit-Oriented Development (ETOD) ordinance intended to unlock dense housing near future Project Connect rail stations, the potential changes laid out in the resolution start by completely removing caps on floor-to-area ratio and height for new buildings downtown — an idea we’ve previously celebrated for obtaining more housing supply on limited downtown land and extracting deeper benefits from the requirements of an updated program.

Abolishing FAR Limits Downtown Is the Best Idea Austin’s Had in a While

The trick to the DDBP, and really all density bonus programs, is to calibrate the additional profit the developer can earn from a larger building with the added construction cost represented by the program’s requirements — ask for too much, and you’re liable to discourage anyone from participating in the program, while asking for too little risks leaving money and benefits on the table. Removing any arbitrary height or density limits on new construction in the downtown area streamlines this process, and with at least one tower on deck to blow past the 1,000-foot mark, it reflects the way the wind’s blowing for one of the fastest-growing cities in the nation. 

Austin’s Record-Setting Waterline ‘Supertall’ Is Halfway Done Downtown

Next, the resolution aims to integrate the DDBP’s current Rainey Subdistrict, which requires more on-site affordable housing than the rest of the downtown area, into the overall program to streamline its guidelines — however, it mentions “applying Rainey best practices to the rest of the program,” which seems to imply some form of on-site affordability requirement will remain intact. Although it’s absorbing the Rainey subdistrict, the new DDBP will somewhat counterintuitively strive to establish four new subdistricts of downtown, each with its own unique priorities and calibrations:

• “A University Neighborhood Overlay Subdistrict south of the University of Texas at Austin to prioritize community benefits geared toward providing affordable student housing and commercial space in alignment with best practices and the City’s housing reports”
  
• “An Equitable Transit Oriented Development Subdistrict adjacent to the Phase 1 light rail transit alignment to provide an option for Project Connect infrastructure and other transit-related community benefits in new developments”
  
• “Cultural subdistrict(s) for Red River, 6th Street, and the Mexican American Heritage Districts to prioritize community benefits for cultural preservation of existing businesses and affordable space in new developments and redevelopments”
  
• “A Northwest Subdistrict, excluding single-family zoning, to preserve and enhance the cultural, historic, and neighborhood character of the West Downtown Austin and Bremond Block historic districts while providing for additional housing capacity through tools such as density bonus programs, facade preservation requirements, design standards, street furniture and pedestrian realm design standards, or other tools that achieve the intent of the subdistrict”

Okay, these could all be great. On this very site, we’ve discussed the possibility of extending UNO south into downtown, along with the need for additional infill development in downtown’s northwest “Lawyer District,” which means we’re currently two for two on prognostication. The cultural preservation and transit-oriented housing stuff also make plenty of sense. However, we’re concerned that these updates to the program could replace needless complexity with simply a more evolved form of needless complexity — establishing four subdistricts, all with their own unique community benefits standards, design requirements, and financial calibrations sounds like a gigantic pain in the ass, both for the city and the developers attempting to work within the new guidelines. Let’s just say we’ll believe it when we see it.

The Children Yearn for UNO Everywhere

Moving right along, the resolution asks for the completion of parking regulations initiated back in 2023 as part of the ETOD ordinance, which would amend downtown parking requirements to encourage decoupling parking from residential units, establishing parking maximums near transit, and counting parking podium structures against bonus FAR for new tower projects — that last one really makes us jump for joy, as it’s the “one weird trick” we’ve been begging the city to implement for years to stop incentivizing the giant above-ground parking garages all over downtown.

Next up are updates to pedestrian design standards in the program, prioritizing sidewalk accessibility and more shade from trees and awnings. Since it’s currently a bureaucratic nightmare just to plant street trees as part of new development — one of those unfortunate situations where the city’s regulatory maze has actually made it harder to do the right thing — we’re happy to see this discussed. If anyone’s still with us, the last two items on the resolution encourage the new DDBP to integrate a simplified affordability program by subdistrict with the aim of maximizing participation in the density bonus program, and to align the updated program with the transit-supportive infrastructure goals of the ETOD overlay ordinance. We’ll probably hear more details on precisely what that means later in this process, especially since Council expects the manager to do some community engagement:

The City Manager is directed to test the proposed changes to the Downtown Density Bonus program through real-world modeling, engage area stakeholders on proposed changes to the Downtown Density Bonus program, in alignment with existing density bonus recalibration and streamlining efforts, and return with a final ordinance for Council approval by Spring 2025.

— Austin City Council

Phew. Good luck, Mr. Broadnax!