As Austin budget passes, council could reconsider Domain deal

The Domain shopping center. (KXAN File Photo)
The Domain shopping center. (KXAN File Photo)

AUSTIN (KXAN) — As the Austin city budget deadline approached quickly, Council Member Leslie Pool said backing out of an economic incentive deal early with The Domain may be the best option to bringing more cash to the table. The Domain is in Pool’s District 7.

The city entered into an economic development agreement with the developer in 2003. Under the agreement, the real estate group agreed to specific performance guidelines, or suffer certain penalties.

In turn, the city has agreed to provide $37 million worth of incentives to the group over a period of 20 years.

“I plan to continue to scrutinize the details on the agreement. We’ll be looking at both the costs and the benefits, and I will bring it back when I have that additional information and any action related to it assembled,” said Council Member Pool on Wednesday night, after the base budget was passed. “There’s more work to be done on this. We are digging deep into the details of the agreement. The property has been sold multiple times and we want to make sure that everything that was agreed upon is still happening.”

The agreement required The Domain use funds to attract and facilitate small, locally-owned businesses to the center from Travis, Williamson and Hays counties, to build a minimum of 300 residential units within six years that meet the city’s S.M.A.R.T. Housing guidelines; and upon the completion of the entire project, the group should create at least 1,100 permanent jobs, among other requirements.

The Greater Austin Chamber of Commerce immediately reacted to the possibility of cutting the economic deal short, saying the idea could “cast doubt on Austin’s integrity.” The chamber goes on to say in a statement, “The Domain took an enormous financial risk in 2003” and they have “played by the rules and have delivered on an enviable master planned community that many are calling our second downtown.”

Council Member Jimmy Flannigan, District 6, told KXAN that upholding the agreement makes sense financially.

“When the city council approves a contract, you need to complete it. If you don’t, then the next contract that comes before you will build in costs for the risk of a future council cancelling it,” said Flannigan. “If we want to proceed in a fiscally prudent way, we need to honor the agreements that we sign. It is that simple.”

The Domain shopping district, a SIMON Mall, has become increasingly popular since it opened the doors to the project’s first phase in 2007. The third and final phase of the project is also now complete. The Domain NORTHSIDE, which is owned by the Endeavor Real Estate Group, opened in fall 2016.

The Domain subsidies sparked a vote in 2008 wherein voters in our community said the city council should honor the deals and the agreements it makes. 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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