In a special called meeting Wednesday, the Austin City Council discussed a proposal by Mayor Steve Adler to address homelessness using money from tourist. Adler calls the plan the Downtown Puzzle
Under Adler's proposal, the city would increase the hotel occupancy tax by one percent immediately, then by an additional one percent in 2021. The bulk of the money from the tax increase would be used to fund an expansion of the convention center. Another portion of the money would be used for historic preservation and helping the music and film industries.
The Mayor's plan would also create a new taxing district, the Tourism Public Improvement District (TPID). According to the Mayor's office, once the convention center renovation is funded and the debt paid down, the TPID would establish a two-percent tax on hotel rooms. That money would be used to provide more resources to address homelessness, including possible housing.
If the City of Austin does decide to expand the convention center, state law will allow Austin to increase how much it can tax hotel rooms. That's because Chapter 351, the statute that regulates the hotel occupancy taxes, is very specific. It states Austin is capped at hotel occupancy tax of 15 percent unless it expands the convention center. If that happens, the cap becomes 17-percent.
"The legislature has enabled us to unlock what we've been told is about $325 million over ten years for community needs if we were to do a convention center expansion," said Adler. "In my mind that would be a good direction for the city because of all of the money, it makes available to us not from taxpayers that we can't otherwise access."
At the heart of the issue for Mayor Adler is addressing needs in the community without increasing taxes on Austinites.
When it comes to homelessness, Mayor Steve Adler says the ARCH is being asked to do more than it has the resources to do.He said the population in the area around the homeless shelter is often preyed upon, resulting in more homeless people being in the emergency rooms and the county jail.
But during the meeting Wednesday, it was apparent that Adler's idea may hit a few roadblocks. The Mayor has an item of Thursday's council meeting agenda, asking the council to approve a resolution directing staff to study the idea and report back to council. But some council members have questions and take issue with the language of the resolution, saying they would support postponing the vote until some of the language can be changed.
The Austin City Council meets Thursday morning at 10:00 a.m.