AUSTIN, Texas — Some Austin taxpayers are trying to stop the City from subsidizing luxury development near Lady Bird Lake.
A group called Taxpayers Against Giveaways, the Save Our Springs Alliance, former State Sen. Gonzalo Barrientos, former Austin Councilmember Ora Houston and Faye Holland are suing the mayor, city council members and the interim city manager.
In December, city council approved adding land along the shore of Lady Bird Lake to the “South Central Waterfront Tax Increment Reinvestment Zone," which essentially allows the City to use tax dollars for improvements to help private development in the area.
The 118 acres includes the old Austin American-Statesman headquarters on South Congress Avenue.
The City expects improvements like refurbishing roads, utilities and other infrastructure would cost $354 million.
“If we don't do this, it'll develop in significant ways, but there'll be low-slung buildings, and not with the number of people or with the volume that is necessary to raise the dollars that we want,” former Mayor Steve Adler said about the project at the time of the vote last year. “Legal says that we're allowed to use the TIRZ [Tax Increment Reinvestment Zone] if the development that we want to have happen isn't going to happen on its own.”
The lawsuit filed on Monday argues the City isn't interpreting the law around this kind of subsidy correctly.
"The City is legally required to show that the land is blighted and will not develop without public subsidies. There's no evidence for that," attorney Bill Bunch said.
The City issued a statement refuting that, saying, “The City believes that Council’s December 2022 action regarding the South-Central Waterfront TIRZ complies with state law requirements. As with many policy decisions, there was ample discussion and community feedback on this topic.”
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