Mayor’s plan for east downtown: Make tourists pay to house homeless

Facing the Austin skyline, runners are preparing for the 40th annual Cap10K, April 23, 2017. (KXAN Photo / Frank Martinez)

AUSTIN (KXAN) — Monday morning,  Mayor Steve Adler laid out a plan that could reshape the east side of Austin’s downtown for the future. Adler, along with various community partners, described a massive development program meant to increase tourism to the city. Money generated from those tourists will help pay for permanent homeless housing and the wrap-around services that go with them.

The plan hopes to leverage what several different groups want. The tourism industry has wanted an expanded Austin Convention Center. Advocates want more permanent housing and support for Austin’s homeless. Supporters of Waller Creek want to completely revamp the surrounding park for a one-of-a-kind outdoor space. Adler calls the situation in east Austin the “downtown puzzle.” Monday, he’ll try and show how the pieces fit together.

Making tourists pay for homeless housing

It’s hard to drive through east downtown without noticing people living on the street. Homelessness is a national problem and it’s also one of our city’s major hurdles. The big hiccup — usually — is money for housing and wrap-around programs.

“We would hope that some of these issues, primarily being the homeless, that there is almost an immediate, emergency type response to begin to address this,” said Austin Downtown Alliance President and CEO Dewitt Peart.

Peart says the amount of homeless is a common complaint for the tourism industry. He thinks hotels will go along with increasing the “bed tax” to 17 percent, if the city expands the convention center and puts more resources to house people.

“Because of the individuals experiencing homelessness, we should have a solution. But also, for our guests who are visiting, it’s not really representing ourselves in the best way,” said Peart.

“Nobody should be living in a creek,” said Peter Mullan, CEO of the Waller Creek Conservancy. “It doesn’t represent our values.” Many homeless in Austin call the area around Waller Creek home.

Mullan says the tax dollars from increased downtown activity would not only help people living in the creek get out but also provide enough money to make the long term plan of revamping the Waller Creek Park system a reality.

“Using the economic benefit of tourism to support a series of initiatives that benefit the citizens,” said Mullan.

One thing Austin does well is attract visitors. This new plan, has them picking up more of the tab for what Austinites have been working on.

Taking a closer look at the mayor’s plan

It would create a downtown TIF — or tax increment finance zone — that could dedicate $30 million in future property taxes to pay for homes for about a quarter of Austin’s homeless.

It would expand the Waller Creek TIF that could dedicate $100 million that could be matched by private donations. It would create a “Tourism Public Improvement District” by increasing the “bed tax.” That would hope to dedicate $4 million to $8 million a year to homeless support programs, renovations to the Palm School, preserve the Historic East Sixth Street and the Red River Cultural District, and finish construction on the the Mexican-American Cultural Center.

To get hotels to petition the state to allow an increase in the “bed tax” the city would expand the convention center. Under the mayor’s plan, the first two floors could be for stores and restaurants. Then on top of the expanded convention centers would be two towers; one for offices, the other for affordable housing.

The property taxes on the increased development could help generate income for the other projects of the mayor’s “downtown puzzle.”

Most of this would need approval from Austin’s City Council. provides commenting to allow for constructive discussion on the stories we cover. In order to comment here, you acknowledge you have read and agreed to our Terms of Service. Users who violate these terms, including use of vulgar language or racial slurs, will be banned. If you see an inappropriate comment, please flag it for our moderators to review.

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