12 C20-2023-026 - Live Music and Creative Space Bonus Phase 2 Staff Report — original pdf

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C20-2023-026 ORDINANCE AMENDMENT REVIEW SHEET Amendment: C20-2023-026 Live Music Venue and Creative Space Bonus Phase 2 Description: Amendments to Title 25 of the City Code to create a new Creative District combining district with provisions for creative space and music venue preservation, modified site requirements, and density bonuses for affordable creative space. Background: Initiated by City Council Resolutions 20220728-094 and 20220901-089, and reaffirmed by City Council Ordinance No. 20230921-103 and Resolution 20240229-060. On July 28, 2022, the City Council adopted Resolution No. 20220728-094 initiating changes to establish the criteria to be a Live Music Venue to and support the creation of a live music venue bonus and incentive program for new and existing venues. On September 1, 2022, the City Council adopted Resolution No. 20220901-089 initiating changes to develop and adopt clear land use definitions and to create a bonus and incentive program for broadly defined creative spaces. These Resolutions are being addressed concurrently. Revised definitions were approved on September 14, 2023, in Ordinance 20230914-097. Ordinance No. 20230921-103 and Resolution 20240229-060 reaffirmed City Council’s commitment to the creation of a density bonus and district program to support live music and creative space districts and the preservation and incentivization of affordable creative space. Summary of Proposed Code Amendment: The proposed code amendments will create a new combining district for an affordable creative space bonus program and: 1. Is available city-wide on parcels in majority commercial districts that have been rezoned to add the new combining district designation as areas that include existing or planned clusters of creative space use structures and sites, through a process including: minimum size requirements of three (3) acres; minimum contributing creative space sites of 25 percent of total sites in district; and review from the Housing Department and Economic Development Department. 2. Defines the following land uses as Creative Space uses: 1. Art Gallery; 2. Art Workshop; 3. Cocktail Lounge; 4. Cultural Services; 5. Performance Venue; 6. Personal Improvement Services; and, 7. Theater 3. Requires the following use requirements for developments in creative district combining districts: 1. Along at least 30 percent of building frontage along the principal street, the building must be reserved for affordable creative space uses in ground-floor spaces; 1 C20-2023-026 2. At least 25 percent of ground floor gross leasable area in the building must be dedicated to affordable creative space; and, 3. Development must comply with protections consistent with Existing Non- Residential Space provisions of 4-18-31 for existing creative space uses in existence on the site for at least 12 months; the developer must: 1. Redevelop the site to replace all existing creative spaces with creative spaces of comparable size; 2. provide current creative space operators with: 1. notice and information about the proposed development on a form 2. a payment that equals the average rent payments for six months of rental approved by the director; payments; and 3. grant a creative space operator the option to lease a creative space of comparable size following the completion of redevelopment. 4. Requires an affordable lease for the the creative space operator returning to a redevelopment for ten (10) years; defines affordable creative space as the lesser of 50% of average retail space rent for the City of Austin, or a fixed ratio of annual revenues considered typical of and sustainable for the type of creative space; and limits year-over-year rent escalation to 5% or less for any creative space tenant. 5. Allows a development that provides on-site affordable creative space or pays a fee in- lieu for the preservation of an existing venue in the same district to be eligible for 30 feet of additional height above the maximum height allowed by the base zoning, up to 90 feet in total height and exemptions from the following site development standards: 1. Minimum site area requirements 2. Maximum floor area ratio 3. Maximum building coverage 4. Minimum street side yard setback and interior yard setback 5. Minimum front yard setback 6. Modifies the applicability of Article 10 Compatibility Standards and creates compatibility requirements for a participating development as follows: 1. Exemption from Article 10 (Compatibility Standards) Subchapter C 2. A 25 ft compatibility buffer that complies with Section 25-8-700 (Minimum Requirements for Compatibility Buffers) 3. Screening for certain objects including vehicle lights, mechanical equipment, and refuse collection areas Code Amendment Text: See attached background information. Staff Recommendation: Recommended The Economic Development Department supports adopting this density bonus combining district as important Council-recommended actions to support preservation and new development of affordable space for live music venues and creative spaces. These tools support the regulatory changes identified in City Council Resolutions 20220728-094 and 20220901-089, including development bonuses designated districts to support creative spaces, and reaffirmed in City Council Ordinance No. 20230921-103 and Resolution 20240229-060. 2 Rather than prescribe areas as creative districts directly, this unmapped district creates a tool that can be used by property owners in partnership with creative space operators, artists, and musicians, to preserve and enhance clusters of live music, art galleries and workshops, theaters, and performance spaces, with strong community oversight through the rezoning process. Proposed criteria for applying this combining district are substantial, and intended to ensure that applications of the creative district combining district will be focused on areas with significant support from creative community and neighborhood stakeholders. C20-2023-026 Board and Commission Actions March 18, 2024 – Recommended by the Arts Commission March 20, 2024 – Recommended unanimously by the Codes and Ordinances Joint Committee with Commissioners Greenberg and Azhar absent April 1, 2024 – Briefing to the Music Commission July 1, 2024 – Recommended by the Music Commission September 24, 2024 – to be reviewed by the Planning Commission. Council Action October 10, 2024 – to be considered by City Council City Staff: Donald Jackson, Economic Development Department, (512) 974-2214 donalde.jackson@austintexas.gov 3 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 ORDINANCE NO. AN ORDINANCE AMENDING CITY CODE CHAPTER 25-2 TO CREATE AND ESTABLISH REGULATIONS FOR A DENSITY BONUS CREATIVE SPACES DISTRICT. BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF AUSTIN: PART 1. Subsection (F) of City Code Section 25-2-32 (Zoning Districts and Map Codes) is amended to add a new combining district to read: (F) Combining districts and map codes are as follows: (24) density bonus creative spaces …… DBCS PART 2. City Code Section 25-2-181 (Density Bonus Combining District Purpose) is amended to add a new Subsection (D) to read: § 25-2-181 DENSITY BONUS COMBINING DISTRICT PURPOSE. (D) DBCS Combining District allows for resiliency and prosperity for centers of art and live music while encouraging affordable creative spaces in new developments. PART 3. Article 2, Subchapter B of City Code Chapter 25-2 (Zoning) is amended to add a new Division 7 to read: Division 7. – Density Bonus Creative Space Districts. § 25-2-451 DEFINITIONS. In this division, CREATIVE SPACE means a use described in Chapter 25-2 (Zoning) that allows one or more of the following occupancies: (1) art gallery; (2) art workshop; (3) cocktail lounge; (4) cultural services: (5) performance venue; (6) personal improvement services; or 8/9/2024 9:41 AM DB Creative Spaces Combining District Page 1 of 8 COA Law Department 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 (7) theater. (A) Application Requirements. § 25-2-452 APPLICATIONS AND CRITERIA FOR DISTRICT DESIGNATION. (1) The Land Use Commission may consider no more than a total of three applications per month for density bonus creative space (DBCS) combining district zoning. (2) An application to zone an area as a density bonus creative space (DBCS) combining district zoning must demonstrate that the area satisfies the criteria for designation and include the information required by the director of the Economic Development Department. (3) An applicant must submit proposed supplemental standards as described in Section 25-2-454 (District Designation Ordinance and Designation on Zoning Map) as part of an application to zone an area as density bonus creative spaces (DBCS) combining district. (B) The council may zone an area that is at least three acres as density bonus creative space (DBCS) combining district if: (1) (2) the base zoning for each site within the area is a commercial or less restrictive base zoning district; at least 25 percent of the primary uses within the proposed district are existing creative spaces or are proposed to be used as creative spaces; and (3) at least 50 percent of the existing uses are non-residential. (C) The council may enlarge an existing density bonus creative space (DBCS) combining district if the sites are existing creative spaces or are proposed to be creative spaces and the creative spaces add or will add value to the district. (D) Except as limited by Subsection (E), the council may reduce the boundary of an existing density bonus creative space (DBCS) combining district if: (1) the site to be excluded does not contribute to the preservation or creation of creative space, including affordable creative space; (2) the site does not include a creative space; and 8/9/2024 9:41 AM DB Creative Spaces Combining District Page 2 of 8 COA Law Department 56 57 58 59 60 61 62 63 64 65 66 67 68 69 70 71 72 73 74 75 76 77 78 79 80 81 82 (3) the site has not utilized the benefits of the density bonus program. (E) A site zoned with density bonus creative space (DBCS) combining district cannot be combined with any other density bonus combining district. § 25-2-453 LAND USE COMMISSION REVIEW. (A) Before an application can be reviewed by the Land Use Commission, the director of the Planning Department must obtain recommendations on an application from the directors of the following departments: (1) Economic Development Department; and (2) Housing Department. (B) The Land Use Commission shall consider the criteria established in Section 25-2- 452 (Applications and District Designation Criteria) when reviewing an application to zone property as density bonus creative spaces (DBCS) combining district. § 25-2-454 DISTRICT DESIGNATION ORDINANCE AND DESIGNATION ON ZONING MAP. (A) An ordinance zoning or rezoning property as density bonus creative space (DBCS) combining district must: (1) describe the creative spaces to be preserved; (2) adopt supplemental standards; and (3) describe the permitted creative spaces to be added. (B) Supplemental standards must assist with preserving creative spaces, creating creative spaces, and furthering the purpose of the combining district by: (1) modifying regulations relating to building setbacks, building height, compatibility, landscaping, parking design, and signs; and (2) prescribing regulations relating to design, scale, or placement for public facilities, including street lighting, street furniture, signs, landscaping, utility facilities, sidewalks, and streets. 8/9/2024 9:41 AM DB Creative Spaces Combining District Page 3 of 8 COA Law Department 83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 100 101 102 103 104 105 106 107 108 109 110 PART 4. Division 5, Article 3, Subchapter C of City Code Chapter 25-2 (Zoning) is amended to add a new Section 25-2-655 to read: § 25-2-655 DENSITY BONUS CREATIVE SPACE (DBCS) COMBINING DISTRICT REGULATIONS. (A) This section applies to a property with density bonus creative space (DBCS) combining district zoning. (B) This section governs over a conflicting provision of this title or other ordinance. (C) Pre-requisites. (1) To utilize the supplemental standards and regulations described in Subsections (E) and (F), the site’s zoning must include density bonus creative spaces (DBCS) combining district zoning and applicant must comply with Subsection (D). (2) To preserve reserved dwelling units and existing non-residential spaces, an applicant must comply with Article 2 (Density Bonus and Incentive Programs) of Chapter 4-18 before applying for a building permit or site plan that relies on the regulations described in Subsections (E) and (F). (D) Existing Non-Residential Spaces. (1) In this subsection, (a) AFFORDABLE CREATIVE SPACE means the rent for the space is the lesser of 50 percent of the average retail space rent within the city or a fixed ratio of annual revenues. (b) CREATIVE SPACE means a use described in Chapter 25-2 (Zoning) that allows one or more of the following occupancies: (i) art gallery; (ii) art workshop; (iii) cocktail lounge; (iv) cultural services; (v) performance venue; 8/9/2024 9:41 AM DB Creative Spaces Combining District Page 4 of 8 COA Law Department 111 112 113 114 115 116 117 118 119 120 121 122 123 124 125 126 127 128 129 130 131 132 133 134 135 136 137 138 139 140 (vi) personal improvement services; or (vii) theater. (c) EXISTING NON-RESIDENTIAL SPACE means a creative space use that has operated for a minimum of 12 continuous months. (2) If a site includes an existing non-residential space, the proposed development must replace each existing non-residential space with a space that is comparable in size for a period of 10 years. (3) Affordable Creative Spaces. (a) At least 25 percent of the ground floor must be eligible to be leased to an operator of an affordable creative space. (b) The director of Economic Development Department determines the fixed ratio of annual revenues, which will be based on the annual revenues considered typical of and sustainable for the type of creative space. (c) Rent for an affordable creative space tenant may not escalate more than 5 percent year-over-year. (4) An applicant for a proposed development may elect to meet the affordability requirements in Subsection (E)(3) without providing affordable creative spaces by paying a fee-in-lieu to a fund managed by the Economic Development Department for the purpose of preserving existing creative spaces or creating affordable creative spaces. At a minimum, the fee-in-lieu shall be equivalent to 100 percent of the required percentage of affordable creative space. The fee-in-lieu shall be set by separate ordinance. The amount of fee-in-lieu due is determined using the fee schedule ordinance in effect at the time of site plan submittal. (5) This subsection establishes an existing non-residential space subject to Division 2 (Redevelopment Requirements), Article 2 of City Code Chapter 4-18. (6) A non-conforming use is not discontinued or abandoned under Section 25-2- 945 (Abandonment of Nonconforming Use) if the non-conforming use 8/9/2024 9:41 AM DB Creative Spaces Combining District Page 5 of 8 COA Law Department 141 142 143 144 145 146 147 148 149 150 151 152 153 154 155 156 157 158 159 160 161 162 163 164 165 166 167 168 qualifies as an existing non-residential space and is required to be replaced under this subsection. (E) Development Standards and Mixed Use. (1) The following uses are permitted on a property with density bonus creative spaces (DBCS) combining district zoning: (a) uses permitted by the zoning that applies to the property; and (b) creative spaces. (2) A development must comply with Article 2 (Site Development Standards) and Article 3 (Building Design Standards) in Subchapter E (Design Standards and Mixed Use) except when those provisions conflict with this section. (3) Mix of Uses (a) In this subdivision, PRINCIPAL STREET has the same meaning as principal street in and is applied consistent with Article 5 (Definitions) of Subchapter E. (b) Pedestrian-Oriented Creative Spaces. When a site abuts a principal street, 30 percent of the building frontage along the principal street and on the ground floor must be designed for creative spaces and must comply with the requirements found in Section 4.3.3.C in Subchapter E (Design Standards and Mixed Use). (4) A building may exceed the maximum building height in the base zoning district by a maximum of 30 feet except that no building may exceed 90 feet in height. (5) A site is not required· to comply with the base zoning district's: (a) minimum site area requirements (if applicable); (b) maximum floor area ratio; (c) maximum building coverage (d) maximum number of stories; 8/9/2024 9:41 AM DB Creative Spaces Combining District Page 6 of 8 COA Law Department 169 170 171 172 173 174 175 176 177 178 179 180 181 182 183 184 185 186 187 188 189 190 191 192 193 194 195 196 (e) minimum street side yard setback and interior yard setback; and (f) minimum front yard setback; provided, however, that if the right-of way is less than 60 feet in width, the minimum front yard setback for buildings three or more stories in height shall be 30 feet from the centerline of the street to ensure adequate Fire Department access. (6) Section 1.4 (Minor Modifications) and Section 1.5 (Alternative Equivalent Compliance) in Subchapter E apply to a site developed under this section. (7) A site developed under this section shall comply with the supplemental standards that are established in the ordinance that created the applicable density bonus creative spaces (DBCS) combining district. (F) Compatibility Requirements. (1) A building is not required to comply with Article 10 (Compatibility Standards) in Subchapter C. (2) In this subsection, (a) TRIGGERING PROPERTY means a site: (i) with at least one dwelling unit but less than four dwelling units; and (ii) is zoned urban family residence (SF-5) district or more restrictive; and (b) STRUCTURE includes a portion of a structure. (3) Compatibility Buffer. A compatibility buffer is required along a site's property line that is shared with a triggering property. (a) The minimum width of a compatibility buffer is 25 feet. (b) A compatibility buffer must comply with Section 25-8-700 (Minimum Requirements for Compatibility Buffers). (5) Exterior lighting must be hooded or shielded so that the light source is not visible from the site's property line or alleyway that is shared with a triggering property. 8/9/2024 9:41 AM DB Creative Spaces Combining District Page 7 of 8 COA Law Department 197 198 199 200 201 202 203 204 205 206 207 208 209 210 211 212 213 214 215 216 217 218 219 220 221 (6) Mechanical equipment may not produce sound in excess of 70 decibels measured at the site's property line or alleyway that is shared with a triggering property. (7) A concrete slab used for a refuse receptacle may not be placed within 15 feet of triggering property. (8) Except for a multi-use trail, an on-site amenity that is available only to residents and occupants of the site and their guests may not be located within 25 feet of a triggering property. (9) Screening Requirements. Except when visible from or through a pedestrian or bicycle access point, the following objects shall be screened and may not be visible at the site's property line or alleyway that is shared with a triggering property: (a) vehicle lights from vehicles that use or are parked on a parking lot or in a parking structure located on the site; (b) ground floor and rooftop mechanical equipment; (c) outdoor storage; (d) refuse receptacles and collection areas; and (e) common areas for amenities, including outdoor decks, patios, and pools. (10) The screening required in Subdivision (F)(9) may not impede pedestrian or bicycle access points. (11) Rooftop mechanical equipment may be screened by a parapet. PART X. This ordinance takes effect on __________________, 2024. 8/9/2024 9:41 AM DB Creative Spaces Combining District Page 8 of 8 COA Law Department  Affordability Impact Statement Live Music Venue and Creative Space Bonus Phase 2 Case number: C20-2023-026 Initiated by: Resolution No.(s) 20220728-094 and 20220901-089 Date: 6/27/2024 Proposed Regulation The proposed amendment would create a new combining district for an affordable creative space bonus program available upon request through a zoning application. It would include the following components: - Requires the designation to be applied to more than one parcel to meet the definition of a creative district. - Requires 30% of building frontage and 25% of ground floor to be for affordable creative spaces. - Requires protections for existing creative spaces, including replacement, notice, rent assistance, and leasing - Requires residential and hotel developments near music and performance venues to conduct a sound - Requires leases to be affordable for 10 years, with rent at 50% of average city retail space rent or a sustainable options. assessment and disclose to future residents. ratio and limited annual increases. - Allows for an extra 30 feet in height and exemptions from site development standards for developments providing affordable creative spaces or a fee in lieu of the affordable space. - Provides for exemptions from certain compatibility standards, replaced with a compatibility buffer and screening requirements. Land Use/Zoning Impacts on Housing Costs The proposed changes would have a neutral impact on land use/zoning related housing costs. This would establish an optional density bonus program available upon request that would require review by city staff, the planning commission, and City Council. As part of the staff review, the Housing Department will evaluate the request in accordance with the goals of the Austin Strategic Housing Blueprint and assess any negative impact to existing affordable housing. Impact on Development Cost The proposed changes would have a neutral impact on development costs. Each proposal will be evaluated individually, with the Housing Department ensuring that the creative district designation does not negatively affect existing and future multi-family developments. Sound Assessment requirements may add costs for multi-family developments within 600 feet of the creative district. Impact on Affordable Housing The proposed changes would have a neutral impact on affordable housing. This creative district density bonus program could compete with other density bonus programs specifically designed for affordable housing, like DB-90. However, the case-by-case evaluation may deem it appropriate in historically commercial districts where housing is less suitable. The Housing Department will review each case and provide recommendations to the Planning Commission and Council. Other Housing Policy Considerations None. Manager’s Signature ______ _______