An Inside Look at Equitable Economic Development in Austin

This post is part of a series on NLC’s Equitable Economic Development (EED) Fellowship.

Councilmember Delia Garza

This week, I had the opportunity to interview Councilmember Delia Garza — an NLC Equitable Economic Development (EED) Fellow from Austin, Texas. Councilmember Garza is the first elected official to be part of a EED Fellowship team.

Carlos Delgado: Councilmember Garza, thank you for accepting the invitation to this interview. Before discussing the importance of supporting local non-tech businesses in Austin, can you tell us a bit more about your background and what influence your decision to run for council?

Councilmember Delia Garza: My pleasure, Carlos. Thanks to you and your team for inviting Austin to be part of a great program advancing equity as the forefront of economic development.

Originally from San Antonio, Texas, I come from a very civically engaged family. Prior to becoming the official elected representative for District 2 and first Latina Council Member, I served as a firefighter and member of the Austin Firefighter Association for six years before working as Assistant Attorney General where I advocated for Texas families in the Child Support Division.

Currently, I am the Chair of the Regional Affordability Committee and the Vice Chair for the Health and Human Services Committee. In addition, I also sit on the Capital Metropolitan Transportation Authority (CapMetro) Board, Austin Energy Utility Oversight Committee, and Mobility Committee. I’m very busy trying to make Austin a city for all residents.

CD: Mayor Adler is a strong supporter of small businesses and community development. Can you share why he selected you to be part Austin’s EED team?

DG: I was part of a core team that worked to develop and pass, through a ballot initiative, a proposal to move Austin from a city council elected at-large to district representation, which we call 10-1. We have 10 councilmember districts throughout the city and one mayor. Having more equitable representation on city council has dramatically changed the conversations about equity and economic development in our city. In particular, I represent District 2 which is one of the geographic areas in the city that has been traditionally left behind and left out of conversations about economic development and Austin’s future.

Additionally, when we were presented with the first economic incentive package as a new council, I spoke out against it, saying that it was not bringing the types of jobs that would help our lower income families. I and two other colleagues voted against the incentive package, but the deal passed anyway. I think the mayor appreciated my concerns about revamping our economic incentive policy to focus on equity and that is why he asked me to be part of this fellowship.

CD: Following up on your point about revamping Austin’s economic development policies with an equity lens, why small businesses are critical for communities to thrive and prosper?

DG: People in Texas often call Austin “the blueberry in the tomato soup”. We pride ourselves on our progressive values and the economic prosperity and opportunity that is possible in Austin.

For Austin to continue as a cultural beacon in the state, we need to be intentional and make sure that we are bringing along all Austinites. That means we need to be creating good, safe jobs that provide opportunities for more than a living wage that give people the chance to grow and develop professionally into careers that can help their families thrive. We need to support small, minority owned businesses both in staying in Austin and new entrepreneurs who want to be here.

The city of Austin is facing explosive population and economic growth which has created pressure on city services, housing supply, infrastructure, mobility/transportation and affordability. Mostly, this rapid growth has benefited tech companies and high skilled labor — but not communities in need.

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CD: Making sure small business have a space in the economic growth of the city — what balance you would like to see between local non-tech small businesses and the tech high skilled sector? 

DG: Austin is in the process of rethinking how we do economic incentives which we call 380 agreements under our state law. Right now 380 agreements barely get used in Austin and when they do it is only for large companies that provide jobs for more highly educated individuals. I don’t think we should be providing economic incentives for businesses that would be doing the same thing regardless of an incentive provided by the city.

Rather, we should think about where we want to go and what values we want to support and use incentives to drive economic development in those areas. For Austin, that should mean providing incentives to small, minority owned, and local companies; supporting the creative and non-profit industries; and businesses that will provide good paying, safe jobs, jobs that have a path to a good paying career; and businesses that help foster development in underserviced and neglected areas. We have done a good enough job in the past of recruiting tech companies, it’s time prioritize other industries that bring good jobs for our working families.

NLC’s Equitable Economic Development panel team meets at Austin’s Mueller development.

CD: In September of 2017, the EED program brought to Austin a team of guest experts and your peer fellows from other 3 participating cities. The goal of the technical assistance visit was to provide the Austin EED team and the city with recommendations to better support local non- tech businesses. How important has been to receive outside expertise to accomplish your goal?

DG: As I briefly mentioned before, Austin is facing population and economic growth resulting in an affordability crisis. As the city grows, more pressure falls on city services, housing supply, infrastructure, mobility, affordability and much more. Many longtime residents and business owners feel squeezed out, and some face the tough decision of either leaving the city to find more affordable housing and business spaces as well as more navigable less burdensome and expensive permitting processes.

The Equitable Economic Development fellowship provides an opportunity to Austin to intentionally focus on cultivating, retaining and growing local small businesses and entrepreneurs in communities of color. As Austin thrives, the City is committed not to lose what Keeps Austin Weird.

Austin has emerging small urban manufacturing, creative and food industries in a city known as a tech and corporate hub. Austin has relied on traditional economic development incentive strategies to attract jobs, enjoying a booming but inequitable economy. Ensuring all residents share the city’s prosperity is a priority for me.

Receiving outside recommendations has been invaluable. It gives a “fresh” perspective on possible problems and solutions at the same time validating current proposed solutions. The roadblocks we face are not new, and are part of what has created this environment that we are trying to change.

We have competing budget priorities. With a limited pot of money, do we invest in more affordable housing, in social services, in better mobility options? Austin is increasingly unaffordable — so how can we best help businesses deal with ballooning costs like the rise of commercial property and taxes without impacting services for everyone.

Finally, we have a broken permitting process. The permitting process in Austin is notoriously difficult to navigate, cumbersome and time intensive. So how best, within the constraints of state law, can we change what we are doing to address those concerns. It is extremely important to have a year-long advisor, in our case Dionne Baux from Main Street America, to guide our team to ensure we have access to best practices and a critical eye on our solutions to make sure solutions are measurable and quantifiable.

CD: You had the opportunity to be part of the team advising Nashville in November. How was that experience? And how important are the peer to peer engagements the Fellowship provides?

DG: It was great to be able to visit another city facing similar challenges that Austin is facing. In many ways it felt like present day Nashville is what Austin was about 15-20 years ago. I think that Nashville can learn a great deal from some lessons learned we have experienced in Austin. For a long time previous city leadership has tended to be anti-growth and here we are now the 11th largest city in the nation. So, even despite pushback from many city leaders in the past, we have continued to experience significant growth.

I believe the takeaway going forward for Austin (and Nashville) is that anti-growth sentiments end up hurting low income families and our small business. I think Nashville is going a great job of being proactive about their growth and it was great to see them recognize the need to start thinking about equity in economic development now rather than when it will be too late.

It is invaluable to have such a vast network of experts and peers who are struggling with their own similar, but unique issues. Sometimes they have faced the same challenges, but successfully navigated it with a different solution than we did. Other times they have used tools we have in a new and exciting way. Our peers provide fresh perspective with greater insight and objectivity. Their outsider perspective has helped us avoid the pitfall of having blind spots, helped us be more creative, and more objective.

CD: Councilmember Garza, it is a privilege to be working with you and your city. Thank you for believing in the process.

DG: Thank you for all your hard work in cities.

carlos_delgado_125x150About the author: Carlos Delgado is the Senior Associate for the Rose Center for Public Leadership in Land Use at the National League of Cities.