Editor's Note: The above video is a previous conversation KXAN's Grace Reader had with Austin Mayor Kirk Watson about federal funding opportunities tied to the I-35 cap and stitch project.
AUSTIN (KXAN) -- Thursday, Austin city council will decide whether it wants to commit funding to design and build roadway elements for park decks over the Texas Department of Transportation's (TxDOT) I-35 expansion project near downtown.
For Austin to build out all of the highway covers it wants, called caps and stitches, city staff said it would cost more than $1.4 billion. Austin city council only has to commit funding for the early construction elements for now, but that alone will still cost hundreds of millions of dollars.
Artist rendering of a cap over I-35 between Cesar Chavez and 4th Street looking north (Photo: Austin's Cap and Stitch Project vision plan)"Thursday, we are going to decide whether or not we have the opportunity to bridge our community's east and west, to cover a highway for more than half of the area between Cesar Chavez and the Red Line or if that opportunity disappears altogether," Austin City Council Member Ryan Alter said.
The search for new funding options
The city of Austin only has so much money it can borrow. City staff have said that, assuming there is no change in state law, the city should not exceed $750 million in additional bond debt between caps and stitches and anything the city opts to put into its 2026 comprehensive bond package.
That's why, in a final scramble to fund the park decks without taking away from other city services, a group of council members are combing through possible funding options that would not take away from the city’s borrowing power for that bond package.
Austin City Council Members Alter, Zo Qadri, ‘Chito’ Vela, Natasha Harper-Madison and José Velásquez are the coalition of members pushing for the building of those highway spaces.
Some asked staff to look at alternate funding options, including looping a cap into the convention center project, using increased temporary right-of-way fees and pulling from eligible transportation bonds, among other alternate funding sources.
‘Yes, and approach’: Council members combing through alternate funding options for I-35 covers“Looking at a car rental tax, which is something that allows for us to spend on a project like the caps, but once again couldn’t be used to spend on homelessness or parks,” Alter previously added.
City staff responded to that request in a memo over the weekend. In some cases, staff said those funding sources could or should not be used for cap and stitch, other avenues would require further research or voter approval and others could face "legal risks."
"The memo was mixed, some of the ideas we brought forward they said 'yes, this makes a lot of sense, you could do this with very little risk.' Others, they flagged potential issues that we need to address," Alter said Monday.
But the memo flagged more issues than it did a path forward for the alternate funding proposal -- and did little to quell the concerns of council members questioning the project's price tag.
"Unfortunately for their proposal, the chief financial officer of the city has issued a memo basically saying none of those funding streams are viable for this project," Siegel said.
Austin city council members will hash those details out with TxDOT, city staff and fellow council members at Tuesday's work session. Alter also said he was learning more about the timeline funding would actually need to be sent to TxDOT to understand how long council would actually have to put this funding stack together.
A slimmer plan
Earlier this month, city staff released an updated cap and stitch recommendation which is significantly less expansive than the city's original vision plan, and the one some council members are still hoping to fund.
‘One chance’: Neighbor coalition pushes for city to fund its portion of Austin’s I-35 Cap and StitchWhile the vision plan placed highway covers with parks and community spaces over the highway in a handful of locations, city staff are now recommending only funding the roadway elements for a cap spanning from Cesar Chavez to Fourth Street and another project from 11th to 12th.
An update 'cap and stitch' staff recommendation (courtesy city of Austin)Siegel said Monday, he's much more likely to support that recommendation this week.
"For me, this is an issue about prioritization, not whether it's a good idea. Instead of building a roof for the freeway, I would like to build houses to put roofs over people's heads," Siegel said.
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