Council backs incentives policy on housing

After a months-long debate, a revamped incentives policy for multifamily projects, intended to help add 7,500 housing units downtown by 2020, has gained the consensus of the City Council.

It's the latest attempt by the city to attract more young professionals to the urban core.

The new policy removes cash grants from the city's incentives repertoire and now consists of tax reimbursement grants, loans and fee waivers. It also adds brevity to the process by basing the incentives amount for each project on a formula. Before, negotiations between the city and developers could take up to 10 months.

“There is certainty now in our incentive policy,” Mayor Julián Castro said. “My hope is that this will unleash a floodgate of great vibrant projects downtown, and I'm confident that we'll create the 7,500 more units we're looking for.”

District 9 Councilwoman Elisa Chan, an early opponent of the policy, said she was pleased with the latest version.

“Before, it really wasn't well defined,” Chan said. “I think we can see after the debate we came up with a better product.”

Next week, council members are scheduled to formally vote on the policy, which is one component of an overall action plan for downtown that covers transportation, infrastructure and the regulation of hotel development in certain areas.

Property tax reimbursement grants would be doled out in 10- and 15-year increments. One requirement would be that 10 percent of the units being built would remain at the initial rental rate for the duration of the abatement.

Loans would be based on several factors, including the project's placement. In an attempt to create a geographic housing balance, the policy would create zones as far north as Mulberry Avenue and as far south as the Lone Star Brewery.

The closer the project is to the urban core, the bigger the loan.

For example, a developer would receive $3,000 to $6,000 per unit if the project was located in downtown's core. The increments would decrease as projects were planned farther from the core.

A project's characteristics would also play a factor. For example, a project could get a larger loan if it was a high-rise or a rehabilitation of a historic structure or if it included housing for college students. Additional loan bonuses would be available for things such as the creation of structured parking or mixed-use, retail or commercial office space.

The new policy also lifts the cap on San Antonio Water System fee waivers per project, which currently plateaus at $500,000. The total amount of $2 million for SAWS fee waivers would stay the same.

An earlier version of the policy was the cornerstone of an overall action plan for downtown by national consultants HR&A, which Centro Partnership, a public-private group charged with leading the revitalization of downtown, helped commission.

That version had also drawn criticism from District 10 Councilman Carlton Soules.

“What I want to make sure of, particularly as we look at cash incentives, is that we don't reach a point where we are asking taxpayers across the city to subsidize a lifestyle of someone who wants to live closer to downtown,” Soules said at a May council meeting. He didn't broach that topic during the question-and-answer portion of Wednesday's meeting.

For developer Ed Cross, who built residential projects The Vistana and 1221 Broadway, the new policy makes the process less arduous.

“All the variables made it a matrix,” he said. “Now you know from Day 1 what you're going to get.”

bolivo@mysanantonio.com