I-35 Cap & Stitch Proposal

[Colleen Pate]

Councilmembers--

As you know, the City of Austin and TxDOT have been working together to figure out what decisions need to be made now, while the highway is being rebuilt, regarding the I‑35 Cap and Stitch program. Some of the choices—like how strong the bridge structures need to be or how much space to reserve for future public use—can only be made during the freeway design phase of the project. Waiting until later to make decisions on caps or stitches could make those same improvements much more expensive or impossible in the future.

This is a tough decision, and the information and recommendations we received from our staff during the March work session provide us the opportunity to reconsider this project overall and consider whether there are better ways to spend our money now. We know we can’t do it all or even most of what we would like. However, it would be a lost opportunity to not do some things right now that add to this project, including to benefit our community now and not be left waiting, hoping something can be done in the distant future. Unfortunately, we have to make decisions now. Making these decisions will also assure the City can get the full benefit of the previously granted $41 million State Infrastructure Bank (SIB) loan, which is designed to support early investments with long-term value.

We need to make some hard decisions before the end of this month. I’m offering a proposal that recognizes our financial issues and the Council division that was revealed when we last considered this. It also takes into account several principles that I believe can and should provide a common foundation for shaping a balanced approach that reflects community priorities, technical feasibility, and long‑term financial stewardship.

1. Building something complete now: I would like for us to have something that folks can enjoy now (or when the I-35 project is completed) and not have caps only sometime out in the distant future, if at all. I’d like the people paying now to get some of the benefit. Planning now and selecting an option that can be completely built will allow our community the ability to enjoy a deck plaza at the completion of the I-35 CapEx project, all the while supporting long‑term fiscal stewardship to the citizens of Austin.

2. Utilizing the SIB loan to complete a project: I don’t want to waste the fact that we have a very good financing tool in the SIB loan. We can use it to get results now through a proposal that allows us to use most of the SIB loan building the roadway elements (the stuff needed to “future proof” things) and a deck today.

3. Smaller local investment: In addition to not wasting the SIB loan, a proposal should be accomplished with a smaller local investment. A proposal mostly funded by the SIB loan will provide us with the opportunity to utilize bond dollars for other local projects or increase our debt capacity for future projects down the road.

4. Give our downtown partners a more focused goal: Rather than tasking our downtown partners, which is led by DAA, to work on a philanthropic giving strategy for multiple large areas, I think we should create a more coordinated, targeted effort, which could be more manageable and more achievable.

5. Prioritizing the connection of East-West Austin: For too long, I-35 has been a sign of division throughout our city, and this presents an opportunity to ensure that we are not waiting for another few decades to better connect our city. We can also focus on connections that have historical significance.

6. Tying into current community projects: Having the proposal be adjacent to another community project (like the Palm Park Project being led by Waterloo Greenway) provides an opportunity to maximize a partnership that is already established, provide a larger public benefit, and ensure that there is established investment included in the area.

7. Minimizing the cost of changing course: Working with TXDOT, a proposal should include potential options that minimize the cost of changing the course of the project and include the local money already expended towards the design of the project from TXDOT.

The approach of mainly utilizing the SIB loan for our I-35 improvements helps support the project’s main goals, like improving east‑west connections, offering more ways to get around safely, creating welcoming public spaces, and honoring the history and culture of the corridor.

Working with ACM Mike Rogers, I’ve been talking with TXDOT about what we could do to balance the principles I’ve outlined above. That has resulted in the following idea:

http://assets.austintexas.gov/austincou ... 103253.pdf

A. Build a finished cap that extends from Palm Park across I-35 to the East. This proposal, unlike the other cap proposals previously, would go over the top of the frontage roads on the West side, creating a complete land bridge from the park to the East side.

The cap would be finished when the road project is completed. So, those paying now would have a more timely benefit.

It would be 160 feet wide. And it would tie into the work going on with Waterloo Greenway and Palm Park. This is significant both because of its tie to park amenities and because of its tie to the history of Palm Park. Using this cap to reconnect this spot of Austin would be great.

The estimated cost for this portion would be $41.3 million. This full project will be covered by the SIB loan. I discuss financing below

B. “Future proof” the potential for caps at 11th and 12th Streets. Again, this would reconnect Austin at an historic spot. The potential future cap would tie the path from the Capitol Building to an area of Austin that was historically the heart of the African American cultural and business community, and an area that Austin has, for decades, invested in.

I believe this proposal would allow for a targeted fundraising effort by our partners at DAA to focus on activating one cap and providing the opportunity to plan for the future

C. The estimated total cost of this proposal is $49.8 million. After discussion with TXDOT, this proposal would be 80% funded by the SIB loan, have the city commit a total of $8.8 million in CO bond money (compared to the $60 million committed during the May 2025 decision), and would result in us not having to pay CO bond money until 2034. The majority of the city payments would not be due until after 2028 which would make a difference in our debt capacity as we are having dicussion regarding a future bond election.

I plan to bring this proposal during the May 28th Council meeting for discussion and hope that we can have a dialogue around what a potential alternative could look like for our city.

I look forward to continuing this discussion as we move forward and hearing feedback.

Thanks—

Kirk
On Behalf of Mayor Watson

[Mike Siegel]

Thank you, Mayor, for all your work on this, and for figuring out a path to provide strong community benefits through a streamlined cap proposal while minimizing the project's impact on City capacity to address high priority capital investment needs. I support this proposal and look forward to the discussion.

Mike

[Krista Laine]

Thank you, Mayor, for your leadership on this issue. Since discussions began last year, I’ve been vocal about my concerns regarding the City’s financial position and the rising construction costs associated with the I-35 Cap and Stitch program.

What you’ve outlined is a fiscally responsible path to delivering a tangible, high-impact project: reconnecting neighborhoods across a highway that has long divided our city, while maintaining a scope that reflects strong stewardship of both local and state taxpayer dollars.

I look forward to the May 28 discussion and am prepared to move forward with this proposal.

Krista Laine

[Jose Chito Vela]

Colleagues,

Last May, this Council committed to the roadway elements of the I-35 Cap and Stitch project, preserving a once-in-a-generation opportunity to reconnect our community and reduce the harm and division the highway has imposed on Austinites for decades. We made that decision fully aware that short-term financial conditions could change in the years ahead, but recognizing our responsibility to think beyond the present moment and invest in the future for our children and grandchildren. We share the desire to deliver tangible results from this investment and remain committed to pursuing the philanthropic partnerships requested last year and recently recommended again by staff. More work is needed to secure those philanthropic commitments and fully realize the vision of the caps for our community. But the people of Austin deserve nothing less and we remain committed to the promise we made as a body to them last year, a promise to reconnect communities, bridge longstanding divides, and create lasting benefits for generations to come.

We appreciate the Mayor's proposal, but feel it does not deliver enough benefits to justify the costs. The proposed stitch is between the Cesar Chavez and Red Line rail crossings, an area that will already have good pedestrian/bike mobility. TxDOT is building enhanced crossings at both Cesar Chavez and the Red Line - just a block or so away from the proposed stitch. The mobility gains from this new stitch will be minimal. And the stitch itself will be about the same size as the Cesar Chavez bridge over I-35.

The goal of this future cap is to connect East and West with a space that brings community together for everyone to enjoy. The proposed stitch is too small to shield someone from the noise and negative effects of the highway underneath - a key element for a successful highway cap. And it is too small for the types of amenities we see on full size caps in Dallas, Boston, Seattle and so many other cities that increase the return on investment being made by the public.

In fact, Council already voted against similar proposals at the Woodward and 51st St crossings. TxDOT had proposed stitches at both Woodward and 51st, but when Council looked at the cost/benefit of the proposed stitches, we opted to focus our investment on full-size caps that deliver more benefits and create more economic development. Our decision back then was also guided by the fact that both 51st and Woodward were already going to include enhanced crossings that essentially accomplished what the stitch would. The same analysis applies to this proposal. It is too small to generate economic development, too small to host amenities and events, and right between two enhanced crossings. While we acknowledge the proposed stitch is cheaper than a cap, it is still $41 million dollars for a project with very few benefits.

Losing the $105 million grant from the federal government for the Cesar Chavez through 4th St cap was painful. There is no question it set the entire project back. But what was lost may be found again. Highway caps are increasingly popular across the country - and have been impressively successful in many places. The political environment could change substantially in November 2026 and grants that were cut by this Congress could be restored by the next Congress or by a future administration in 2028. That is why we pushed so hard on future proofing the highway redevelopment. There will be future opportunities to cap the highway, but only if the road supports are built now. It's just a matter of time.

Finally, Dallas has just opened their second highway cap and is in the process of enlarging their first highway cap. We've included links below to media coverage of the new cap. The potential for Austin to build similar caps is there if we just have the resolve and the patience. We can marshal the private sector just like Dallas and other communities have done, but only if they have certainty in what they’re investing in. The lack of funding to date has largely been a result of the business community not knowing what caps are even a possibility.

Sincerely,

MPT Chito Vela
CM Ryan Alter
CM Natasha Harper-Madison
CM Zo Qadri
CM José Velásquez


https://www.fox4news.com/news/dallass-2 ... dallas-zoo



https://www.archpaper.com/2026/05/hks-s ... erin-park/