‘Serious tradeoffs': Austin considering I-35 covers versus other city needs

Yahoo

07-04-2025

Editor's Note: The video above is KXAN's previous coverage of the potential 2026 bond package.
AUSTIN (KXAN) — Tuesday, city leaders are slated to discuss whether or not Austin can afford to build covers over the Texas Department of Transportation's (TxDOT's) I-35 expansion project, connecting east and central Austin.
Those covers are called 'caps and stitches' and may look like deck plazas, walking or biking trails or green spaces running over the wider highway.
'These caps would not only stitch our city back together, they would create new, valuable land in central Austin for parks, civic space, and future development. If we fail to fund the roadway elements now, those caps can never be built,' Austin City Council Member Chito Vela wrote in a message board post.
Austin's full capped I-35 'vision plan' could cost over $1B
But Austin's current proposed Cap and Stitch Vision Plan could cost more than $1.4 billion, city transportation officials have previously explained. That doesn't include the cost of operating and maintaining those spaces.
'That would use up our entire capital budget and so we really have to be careful in the investments we're making both in terms of our annual general fund decisions as well as our capital budget decisions,' Austin City Council Member Mike Siegel said on an episode of Inside Austin's Agenda last week.
Austin leaders need to commit funding to TxDOT to build the roadway elements of the caps and stitches by next month, if all goes according to schedule. That part alone could cost roughly $250 million, transportation staff have previously said.
Austin's vote on I-35 cap and stitch funding delayed again amid federal funding uncertainty
'What I want to get into is whether it's worth it compared to the tradeoffs,' Siegel said. He noted the city's financial department has explained, 'we can only ask for so much in bond dollars before our credit rating goes down and the price of debt goes up, basically. And so every $100 million that we dedicated to cap and stitch is instead of something else that we might need.'
That's where the city's possible 2026 bond election rubs against the cap and stitch project. While the city works through a comprehensive bond package that it may bring to Austin voters next year, the amount of money the city may need to borrow for caps and stitches will play a role.
'If we take that [the bond proposal] to the voters in November of 2026, that will require debt. And if we're issuing debt to deal with the caps that we're talking about, that will impact how much we can do on the comprehensive bond package,' Austin Mayor Kirk Watson explained.
That is likely to be a central point of Tuesday's Austin City Council work session talking about the caps and stitches before council votes on its commitment to TxDOT next month.
Inside Austin's Agenda: City Council Member Mike Siegel
'We have about $10 billion in unmet capital needs, we can only spend $1 billion at most, or ask for 1 billion at most in expenditures and so there's going to be some serious tradeoffs,' Siegel said.
Austin leaders are eying a comprehensive bond package that you could vote on in November 2026.
The 2026 Bond Election Advisory Task Force is working through what may be included in that ask of taxpayers. That task force has two appointees from each council office and the mayor. It meets once every month, starting in January of this year.
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'The city has real needs whether it be parks, whether it be road infrastructure…the council has asked for a comprehensive approach,' Watson said.
While the task force is still in the early stages of figuring out what it might work into that bond package, they're gathering information from city staff on what each department may want to prioritize. The task force's March meeting included briefings from city leaders working on transportation, homelessness and housing.
'In July 2025, staff will present the preliminary ranked needs assessment that will NOT include refined project scoping and cost estimating since that work will not have been initiated at that time,' a memo from city staff said.
You can find a proposed timeline from city staff in that memo here.
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