The plan would have used property taxes to fund, in part, a development along Lady Bird Lake where the formerA Travis County District judge has ordered the City of Austin to scrap a plan to divert a portion of property taxes from general city services and use it to fund infrastructure projects — such as roads, sidewalks and affordable housing — in parts of South Austin.
Money from TIRZs have been used to fund the redevelopment of several neighborhoods in Austin, including most notably the city's Seaholm District. Home to the former city-owned power plant, this section of downtown is now full of high-rise apartments, shops and restaurants. But lawyers for the plaintiffs, including former state Sen. Gonzalo Barrientos and former Austin City Council Member Ora Houston, argued this tax plan was a misuse of state law. A TIRZ is intended to incentivize development in an area where it otherwise wouldn’t happen. Attorneys argued developers building in neighborhoods just south of Lady Bird Lake, where homes sell for over $1 million, need very little encouragement to build.
In their lawsuit, Bunch and fellow attorneys quoted former Austin Mayor Steve Adler during a hearing on the TIRZ in 2022.