City Council Weighs Proposal for 2,600-Acre Development

Austin’s City Council approved an agreement last week to create a massive mixed-use development of more than 2,600 acres – over twice the size of Austin’s Downtown – just east of the city limits. The development will be built on a piece of land sitting beside the Colorado River, between U.S. 183 and State Highway 130, in an area known as “Dog’s Head.” 

There are starkly different takes on the development agreement. City officials said it represents a financial lifeline for Austin as the community looks for a way through its first budget crisis in decades. Residents who denounced the proposal at a City Council meeting last Thursday, May 21, said it’s an ecological catastrophe in the making and the product of a rushed and corrupt backroom negotiation. 

Dog’s Head is so named because the outline of the area, viewed on a map, resembles the head of a canine. It lies 3 miles from Downtown, 1 mile from the airport, on a peninsula of flat land bounded on three sides by the Colorado River. Much of it is within the 100-year floodplain. Lobbyist Richard Suttle, who represents the owner of the land, Endeavor Real Estate Group, told Council on Thursday that the site has served as a sand and gravel quarry since the 1950s. “Environmentally, this thing has been bombed out over 70 years,” Suttle said. “We’re bringing it back.” 

City staff described Dog’s Head as blighted in the proposed 45-year development agreement that dropped with little notice on May 14. At a Council work session four days later, staff urged the city to incorporate Dog’s Head into the city limits and sign the agreement with Endeavor, arguing that Austin must expand its tax base and find new revenue sources if it is to remain financially stable. 

“For large American cities facing fiscal uncertainty, the opportunity to annex a massive single-owner tract of land shouldn’t just be viewed as a routine real estate transaction,” Assistant City Manager Eric Johnson told Council. “This is not something that shows up on the radar for American cities. And I just need to make that statement, that it’s a rare opportunity.”

The staff presentation described the types of development that might be created at Dog’s Head, calling it “a prime candidate for a massive mixed-use hub, employment centers, secondary corporate campus, and sports and entertainment to name a few.” It said the site has the potential to generate $3.5 billion in new property tax revenue over the next 30 years and argued that the agreement would steer development closer to the center of town, helping reverse urban sprawl. It added that the agreement would allow a new public trail to be created on the Colorado River, along with the development of affordable housing. 

For most people, the staff presentation was the first time they had heard anyone from the city discuss Dog’s Head or the proposed agreement. At a City Council meeting two days later, over 50 residents spoke against the proposal, with just one in favor of it. Bobby Levinski, the lead attorney for Save Our Springs, summarized the arguments, calling the agreement a disaster and a “middle finger to East Austin.”

“We need to be moving forward on environmental restoration activities, not agreeing to [something] that would allow 45 years of locked-in development regulations with 100% impervious cover in all of the developed area,” Levinski said. “You’re going to make changes to one of the most ecologically sensitive stretches of an urban river in the entire state of Texas and you’re going to prevent any future Council for 45 years from correcting this mistake.” 

Citizen after citizen asked that the agreement be delayed and that it be sent through the same city zoning process that development projects built within the city limits are required to pass. Several residents of the small Hergotz Lane community on the south bank of the Colorado River, across from Dog’s Head, said they had received no notice of the project from the city. Resident Garrett Tung said he had been surprised to learn 48 hours earlier that a river trail that is part of the proposed development “runs directly through what is, as of this moment, my living room.”

Other citizens protested the agreement’s Section 3.07, which would allow Endeavor to build up to 100% impervious cover on a vast majority of the tract. Craig Nazor of the Sierra Club said that such a big development right next to the river “doesn’t make sense.” Rich Heyman, a candidate for City Council, said the agreement was the product of a backroom deal. “This Council’s taken $130,000 in campaign donations from the developer and about $123,000 from Armbrust and Brown, the principal lobbyist,” Heyman said. “For those wanting to know the price of this kind of sweetheart deal in Austin, it’s right around $250,000 – a bargain for what they’re getting.”

Before Council passed judgment on the agreement, Suttle, the main lobbyist for it, answered questions. He said that if the city rejected the deal, Endeavor could build a different kind of project under Travis County’s less-stringent development rules, something Mayor Kirk Watson noted would result in Austin receiving no tax revenue from its creation. But Suttle emphasized that Endeavor will make more money if it develops the property in partnership with the city. And he said that Endeavor needs to move quickly, as it has received a lucrative proposal from an unnamed Fortune 100 manufacturing company that would serve as the first tenant for the project.  

Council Member Mike Siegel asked Suttle if he could provide more info on what kind of business the Fortune 100 company is. Suttle said he had signed a nondisclosure agreement (jokingly adding that he could lose his dog, truck, and wife, and that he really didn’t want to lose his dog), but that the company wasn’t a data center, a defense contractor, or another kind of business to which Austinites would object. Siegel asked if residents would be disappointed when they learn who the owner of the business is, perhaps referring to the Tesla Gigafactory, which sits next door to the site. “I don’t think you will be,” Suttle replied. 

With these assurances in hand, the other Council members signaled their approval of the agreement, noting that Endeavor has a track record for developing large, complex projects like the Domain, Southpark Meadows, and several Downtown high-rises. CM Krista Laine asked Endeavor’s Andy Pastor, who was seated beside Suttle, what his group envisioned for Dog’s Head. 

“Think of Downtown,” Pastor said. “Any of those kinds of uses. It’s an opportunity to do something different, to have a great walkable, bikeable community with a completely blank canvas.”

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