Good morning.

The time is now 1006 a.m.

on Wednesday, February 18th, 2026, and the meeting of the governance committee is now called to order.

Madam Clerk, please call roll.

Councilmember Mickey Rodriguez.

Councilmember Via Gran.

Councilmember Mungia.

Present.

Mayor Jones.

Here.

Mayor, we have a quorum.

Great, thanks.

First item on the agenda is approval of the minutes.

Are there any corrections to the minutes from last month?

Hearing none, may I have a motion and a second to approve the minutes?

Motion to approve.

Okay.

Great.

We have a motion and a second to approve the minutes.

All in favor say aye.

Aye.

Opposed.

Okay, great.

Motion carries.

Um we do or do not have members of the public here to speak.

We do not.

Okay.

Um we'll move on to the action items.

Madam Clerk, please read the caption for item two.

Item two is a council consideration request by councilmember SOCOR, District One, to create a program to support and incentivize missing middle housing development.

Um so we'll get the staff presentation and then we'll hear from the sponsoring um council member.

Go ahead.

Okay.

Veronica Garcia.

Great director of neighborhood and housing services department.

Today we are going over a CCR on supporting and incentivizing missing middle housing.

The CCR was submitted on January 27th by Councilwoman Core, and it's also supported by Council Districts 2, 4, 5, and 6.

And the request is to look at the creation of a program which would support the development and possible incentives for missing middle housing within the city.

The request includes multiple recommendations.

The first is creating helping with pre-development assistance for developers to identify land.

The second is to create a single point of contact within the city to provide that technical assistance for this type of housing.

The third is to look at creating permit ready designs that would include options compliant with historic and conservation districts.

Next, we're asked to look at additional fee waivers and other incentives from the city, which may include SAWS Impact Fee waivers, city and county property tax abatements, as well as possible grant funds or low interest loans.

Finally, we were asked to consider developing an annual training cohort or mentorship program for specifically for small scale developers.

Missing middle housing is a range of multi-unit housing types, really between single-family housing and large multi-family apartment complexes.

Missing middle housing can include everything from duplexes, fourplexes, townhomes, bungalow courts, and yes, even casitas.

These homes are compatible in scale with single family homes and they provide more affordable diverse housing options that support walkable neighborhoods as well as retail and public transit.

The neighborhood housing services, our team is currently working with the consultant to help identify and define the barriers of missing middle housing development.

This analysis will look at barriers that are in the unified development code to help help prevent creating these housing types more easily.

We're working now with local developers to better understand what the current code limitations and challenges may be.

And any UDC recommendations will be coordinated with the housing commission's removing barrier subcommittee in preparation for the upcoming 2027 UDC amendment cycle.

Affordable missing middle projects are currently eligible to apply for existing incentives, of which there are several.

So it is important that we may want to look at, well, that's part of what the CCR is asking our team to do is look at in addition to zoning reforms, maybe look at targetive incentive programs specifically for these types of developments.

Anything that would be looked at would have to be prioritized within our other current incentive programs as we don't have an additional funding source identified yet, but that's all part of what the CCR has asked us to consider.

The missing middle housing is included already in the SA tomorrow comprehensive plan.

It's referenced in the strategic housing implementation plan as well as transit-oriented policy framework.

Our team is currently undergoing a refresh of the ship, and where we're looking at recalibrating our housing targets, and we will look at incorporating missing middle housing as part of that effort.

So recommended next steps is to continue to study and develop potential recommendations and costs related to implementing a missing middle housing program.

These recommendations would be presented to the planning community development committee at a future meeting.

And we also recommend this item also be considered as part of our ship refresh efforts.

Happy to answer any questions you may have.

Thank you, Mayor.

Thank you, governance committee members.

So thank you all first of all to Councilmember Mungia, Councilmember McKee Rodriguez, who's here virtually, Councilman Castillo, and also Councilmember Govan for signing on to the CCR with us earlier this year.

So this is a program that we've actually been working to develop over the last year and been working very closely with NHSD and their staff has been doing an amazing job partnering with us to figure out what it is actually the gap for missing middle housing.

As you may know, in the urban core, we just had a meeting yesterday with our educational committee meeting that there are a lot of families that are moving out of the urban core, and we have to continue to create more housing options for folks that can want to come and live back downtown in and around downtown areas in our urban school districts.

In order to do that, we have to get creative with our housing supply.

We don't unfortunately have multiple acres of land where we can do.

If you look at that unicost map, would you mind pulling that map up?

I think it was slide three.

Um it's this one.

Thank you.

If you look at this map, you'll notice that we're working on detached single family homes with our community land trust, and we're working on a lot of mid-rise projects through our housing trust through our housing bond, and we've seen growth in that.

We saw just last week at the Greater SATX presentation, how we've made investment there, and those numbers are now getting better.

And so this missing middle part is this is the area that we don't we haven't quite figured out in terms of how to incentivize.

Veronica mentioned it's really hard and expensive to do these types of projects, and the big developers that are doing mid-rise don't really want to build a four-unit uh multiplex.

And so this conversation started when we talked to some developers that were doing these developments, but at market rate, and we asked them, hey, what would it take for you to actually do these uh uh apartments in an affordable way?

And they listed a lot of barriers that they were facing in that process.

One of them was form-based barriers, and um, like I mentioned, NHSD has been side by side with us on this, and so they decided to go forward and do a have a consultant come in and look at those form-based barriers.

And so we're very excited about those code updates because we know we have to address those things, but at the same time, we also wanted to develop a program simultaneously, and so that's why we decided to move forward with the CCR so we can explore what those financial barriers are.

Another thing that we've heard is technical assistance.

So we had a project that's a 16-unit market rate project in district one, and they got several different answers from DSD multiple times throughout the process about what would be required for pull-in parking, what would be required for getting variances, how would they need to do that?

They got a lot of different answers, and not until at that time I called Mike Shannon for him to go out and visit the site.

Were they able to really understand what they were trying to do and find a solution to it?

And so having a point person at DSD that truly understands infill, I think will be very important in this process so that we can get creative on what how many units we're putting in a specific area.

And then the last thing I think we need to look at outside of financial outside of DSD support is how do we work with community to see the benefit and value of this?

And I know that we are doing our planning processes right now for our uh to decide what fits where, but at the same time, if there's technical assistance providers out there who some of whom we've met with that can actually map out how many units could fit on this in terms of what is currently allowed with the two and a half story requirements or historic requirements, and providing that support for folks could help them lower the barriers on the front end so they'd be willing to do more of this development.

And then lastly, these small-scale developers that we've talked to are local residents that want to take on a project.

Some of them are women, which we don't see very often in the mid-rise area.

And so I think this would be a good opportunity for us to truly break the barriers for income for our local resident developers.

Thank you.

Great.

May I have a motion and a second to approve uh the staff recommendations so we can begin to begin discussion.

Motion to approve.

Okay.

Okay, great.

Um okay, thank you for the presentation, staff.

Um, I've got a couple of follow-up questions.

Um I certainly agree with um one there being uh well the importance of of one person uh being being able to provide consistent answers.

I think that makes a lot of sense, of course, um, in in this space.

I think this may be more of a um philosophical uh question that that we really need to tackle as a as a council, which is you know, with limited um one limited space, and frankly, we're gonna get an update later on um uh on our on our financial update.

And um you'll see the amount of money that we forego in property taxes, right?

And so if we want to, there's I think there's incentivizing, but then there's also you know, kind of the right placement of these things.

Um, and as we know the growth that is coming to our community, um again, a city the size of Austin by 2050.

Um what is the right mix of these housing projects, housing developments, and by location um that best meets that.

And um I'm not sure, and again, I know analysis, an additional analysis is gonna want to go on there, but I I'm not sure duplexes and triplexes are the are gonna get us the density that that we need um in a lot of in a lot of places, right?

Um so um I'd also welcome understanding Vrona, if you can speak to it, how the change in legislation and the last session um makes some of this easier or harder based on how you see it.

Sure.

Um, in response to the density, yes, this is a lower density housing typologies.

Um, what other cities have done, and we looked at about half a dozen, is that's just kind of where they started is making uh zoning updates, looking at building making it easier to build multiple units on what may be a single family lot.

So it is a lower density product, um, but it can help create more units on a lot that may otherwise just be one unit.

So it's something that we'll look at in our analysis as well.

Um, as far as the state legislative changes last session, um, the state made it easier to build housing in general, um especially on lots that were zoned commercial that it can now be turned into housing.

Um, I'm not too familiar with anything made on the single family side.

Uh Mark Carmona is here and he's in a lot of work on the housing legislation, so I'll see if he um has anything else to add, particularly for the single family lot development.

Mayor, to my knowledge, there was nothing that was done on the single family side, it was more the commercial conversion to rental now.

The conversion from a commercial space uh could be considered for missing middle housing.

I think it probably would be a good fit depending on the size of the footprint itself.

If it's a large, it's probably more aligned with the larger density project, but smaller sizes on the commercial sizes that have been abandoned or available could be good fits, and I think it fits within the spirit of the legislation that was passed last session.

Comments?

Um, Councilman McKee Rodriguez or Councilman McGill.

Okay.

Councilman McKee Rodriguez, can you hear us?

Okay.

Okay.

Question about comments?

Would you um I I'll just say um I'll support staff's recommendation.

Um, I'm listening to this, and I I think you know, one of the challenges we're gonna have forever is figuring out how best to allocate our limited resources, and we want to make sure that we're using our resources in the way that's going to do as much good as possible and address the the need that we have, and we know that it's hardest to develop the deeply affordable housing.

And so I'll I'll continue to stress I think that's where our priorities need to be, but at the same time, uh there has to be a way to address the other gaps that exist in the system, including the missing middle.

And so uh I wouldn't want to preempt staff from looking into possible incentives, looking into uh opportunities to make the development easier.

I don't think it always looks like a tax abatement.

Um so I I look forward to continuing to have this discussion um and continuing to see what the you know the end result is gonna be.

Thank you.

Yep, councilman.

Thank you.

Uh and I I appreciate what Veronica just said, and I think this is what you see in districts one and two is some of those missing middle is um areas where there would be a single family house that gets turned into that.

So I think that's a really good way to target the incentive program.

Um is if maybe it's in I refer to as the donut right outside of downtown, but up to 410.

So maybe that whole area around the city is where we look to have this type of program, right?

Because this was not gonna work on, you know, in D4, where we have Toyota and we're having we're still building large, you know, subdivisions of single family houses.

I just got a request yesterday for 380 homes, you know, not too far from Pearsall Park, uh, which we're not gonna do, but that's a separate story.

Um, but I think you know, I think it's very specific places this is gonna work, uh, and very specific land use categories that we can convert to make this happen.

And I think this kind of goes into some of the mayor's um work on our task force that we're doing.

I think some of these missing middle units and communities are really beneficial to uh special populations of folks, right?

It's so uh, you know, maybe it's targeted to um people with different disabilities or you know, young folks in LGBT community.

And then I think young folks in general, you're right, you know, we think about our council aides and and where they're at in their professional career, and I think these types of homes in the city core is where you're gonna see young professionals move before they can buy a house.

Uh, especially if they want to live in the area, there's limited apartment um options.

So I think if it's done well and targeted, it can be a really useful tool.

So I appreciate that.

And I look forward to the conversation at PCDC.

Veronica, and the work that you've seen in other places, um, what's been the mix?

Um, not only the type of housing, but whether it's you know, the the mix between rental and and home ownership, right?

As we're already as we're always kind of thinking about how to the community can build wealth.

Sure.

Well, we definitely see a lot of rental projects, especially in this type of housing.

Um, and again, we looked, we only looked at about half a dozen other cities, and we'll look at a couple more.

Um, most of them did not have separate financial incentives set up.

Um most of them started with making it easier to build the housing, streamlining the process, like councilman core mentioned, making it easier to understand what permits are needed, making it almost as of right to build up to four units on a single lot versus having to go through a whole rezoning process to do so.

So that is part of the work our consultant is looking at and the conversations we're having.

So that'll be come sooner rather than later while we look at what other um layers we can add to make it easier.

Okay.

And what we've seen other cities do is sometimes also look at the density bonuses.

So if they do offer housing that's more affordable or for deeper affordability, like councilman McKee Rodriguez mentioned, they may be allowed um automatically to build more units or other incentives may be coming.

So we'll we'll look at that too.

One of the things that um came across actually in the pre-brief I had for again the briefing that we'll have later on today, as we again shouldn't look at these things in silos, but you know, to the extent um there are our um examples where you can understand what um uh frankly um the high level of success looks like.

So for example, yesterday in our discussion, we talked about um you know, one of the surprises being the number of people that um took us up on the homestead exemption, right?

And so now what that looks like in terms of wild success is what I was looking for.

Thank you.

Um so now what that means then, right, in terms of our general fund.

And frankly, the assumptions you could make, even if you don't build one more house in the community, if you continued on that trajectory, you have a pretty good idea of what's not coming into the general fund.

So I think when we look at things like this, and we also then look at kind of what's the right mix, right?

Of of rental and and home ownership, what are some of the planning assumptions that we're putting into where you would see things like this?

Um, but then I think that question of does it actually have to be incentivized given given what it costs to do this, and and frankly, who would most benefit from this kind of housing, right?

In light of some of our more strategic needs.

Um, a lot of this you see like in Alamo Heights, right?

Um, when I think of kind of where you see this stuff now.

We had a couple of duplexes and in Heritage Farm, um, but they looked different.

They look different.

Um, but I just I can't get escape from frankly the density that we know we need, um, and you know, making sure that we've got the right uh distribution of focus and energy and abatements if that is in fact the case uh to meet that need.

Because when I think of middle middle housing uh missing, I'm thinking about middle, i.e.

um those that make between 50 and 80k.

But that's who I think about, right?

Less kind of the type of thing, but rather their ability to afford, yeah.

Shark.

Did you have something, Eric?

Okay.

Yeah, go ahead.

Um I do like the by right conversation.

I think that's gonna be a good area um to kind of start it off.

And I think it could be if you have a property that's an R6 by right, you can do something like that, because obviously that lot size is gonna be complementary to a multiplex.

Um not gonna work with R4, right?

Which we're seeing more of the newer subdivisions are R4.

You're you're not gonna be able to do this on that property.

And I'm thinking of, you know, in some cases, which is not my case, but some folks right who get homes inherited by their parents, maybe that are in these older communities, R5, you know, woodlawn area, whatever, um, that could be something that they do with that investment uh by right, is that they're able to just change that without going through a zoning process.

Um, so I think that could be a good way to kick start that.

Uh but obviously that's a large discussion.

So one of the things actually, um, Veronica, I I want to make sure that we also include um as as part of this, are the um requirements that we put in place on those developments.

Um, and I say that because you actually have some of this middle housing, missing middle, excuse me, housing that exists in the community that has been on the market for a long time.

Um, and it's part because, just to be frank, it's kind of shoddy construction, right?

You have central air that's like not central, it's like the AC that's put in there.

And so my point is we can build it, but I think the level of quality is gonna determine whether somebody actually wants to rent that or or buy it.

So it's not just do we have enough of it, is it do we have the enough of the type of quality that people are going to want to live in or buy?

So being thoughtful about some of those restrictions, um, I think it would would help our overall objectives here.

Um, as well as you know, some of the aesthetic of some of those as well.

So it's not just inside, but it's outside.

I think if you were to drive around the strip, you would see exactly what I'm talking about.

Uh the places that were put up pretty quickly and and have been empty for a long time.

Yeah, and similarly around the Jefferson area, the woodlawn area.

Okay, you'll hear that a lot too.

Okay.

Um, all right.

Anything else from council members?

Okay.

Uh there being no further discussion, we have a motion and a second to approve the staff recommendation with some of the additional uh questions and tasks.

Um all those in favor say aye.

Aye.

Aye.

Aye.

Opposed.

Okay, the motion passes.

Great.

The time is 10 28 and the meeting's adjourned.

Thanks.

Thank you very much.