Incentives, Density, and Affordability

We usually don't quote ANC comments out of context, but this provides some useful context and links to documentation that shows why Austin is failing to provide affordability to Austinites:

Bill and Dave make excellent points. (Bill Bunch, Save Our Springs, and Dave
Shapiro, Western Trails)

  Increased development and density over the aquifers and recharge zones
causes more runoff, erosion, and pollution. It also reduces recharge into the
aquifers. I see these impacts first-hand in my own neighborhood.

 We should be careful not to conclude that increased density results in
more affordable housing or less sprawl. The density of my neighborhood has
greatly increased over the past 10 years, yet housing in my neighborhood is
significantly less affordable. Low- and moderate-income families are moving to
the suburbs because they can't afford to live in Austin. Families that want to
live in single-family homes are moving to the suburbs because single-family
homes in Austin's urban neighborhoods are rapidly disappearing.

 Housing prices and income are the biggest components of housing
affordability, not increased density. Housing prices have increased faster in
Austin than most other large US cities primarily because of rapid growth. At the
same time, incomes for low- and moderate-income families are stagnant. Rapidly rising housing prices and stagnant incomes are the root causes for the housing affordability crisis in Austin, not density.

 The City's economic development incentives and rapid-growth policies
have not helped low- and moderate-income families. A January 31, 2014, report in The Business Journals noted that Austin ranks #33rd-highest in income inequity in 102 major U.S. markets. It also indicated that the top 20% of households in Austin earn 49.9% of all household income in Austin. 

 Here's a link to the report in the Business Journals: http://www.bizjournals.com/bizjournals/news/2014/01/31/gini-indexes-of-income-inequality-in.html

 A 2012 study by the New York Times indicates that: "incentives do not
actually cause companies to choose locations over others. Rather, companies
typically select locations based on factors such as workforce, proximity to
markets and access to qualified suppliers, then pit jurisdictions against one
another to extract tax benefits and other incentives."

  The New York Times study found that: "there is virtually no association
between economic development incentives and any measure of economic performance. We found no statistically significant association between economic development incentives per capita and average wages or incomes; none between incentives andcollege grads or knowledge workers; and none between incentives and the state unemployment rate."

 Here's a link to information about the New York Time study on economic
incentives: http://www.theatlanticcities.com/jobs-and-economy/2012/12/uselessness-economic-development-incentives/4081/
 
A 2011 study by the Lincoln Institute of Land Policy found "property tax
incentives to be counterproductive, being all too frequently given to companies
that would have chosen the same location anyway. So instead of creating new jobs or spurring employment, the main effect of incentives is simply to deplete a community's tax base."

Here's a link to the Lincoln Institute study: http://www.planetizen.com/node/57440

 Although Texas gives out more economic development incentives than any
other state, it has the third-highest proportion of hourly jobs paying at or
below minimum wage and the 11th-highest poverty rate among states. Most of the job growth in Austin over the past 10 years has been in industries paying
employees less than $30,000 per year.

 A report by the Annie E. Casey Foundation shows that the extreme
poverty rate in Austin rose from 10% to 15% between 2006 and 2012, worse than the other major cities in Texas. Here's a link to the Annie E. Casey Foundation report:
http://datacenter.kidscount.org/data/tables/45-children-in-extreme-poverty?loc=45&loct=3#detailed/3/107,55,59-60,64,89/true/868,18,17/any/325,326

  The City Council should address the housing affordability crisis by
promoting moderate growth policies, granting higher property tax exemptions for seniors and the disabled, and focusing economic polices on training and higher paying jobs for low- and middle-income families.
  
David King
 Zilker Neighborhood Resident