A proposed multimillion-dollar office lease for the agency building Austin’s light-rail system was “not how we should be spending these dollars,” a prominent Project Connect supporter said Saturday, arguing the controversy shows why elected officials need a role in overseeing the voter-approved transit plant.
Austin City Council Member Paige Ellis, who also sits on CapMetro’s board, made the comments during a KUT Festival panel on Project Connect, the multibillion-dollar initiative to expand light-rail, commuter rail, bus service, Bikeshare and other transit options in Austin.
“For [Mayor Kirk Watson] to catch this coming to the ATP board and to say, this is not going to happen, this is not the best way to do this, is how a functioning system operates,” Ellis said. “That’s exactly how a transparent system should work.”
“I think the mayor was right to say this is tone-deaf,” Ellis said.
While Watson didn’t use those exact words in public, text messages obtained by KUT News under the Texas Public Information Act show he was blunt about the proposal.
“What is he thinking?!” Watson wrote in one message to a senior staff member on April 11. The staffer had sent Watson a social media post about the lease by X user @data_atx that was gaining traction online.
“It’s a bad idea and now he’s pushed me into a corner,” Watson wrote in another text message. “Doesn’t pass the smell test.”
Watson went public on April 13, asking ATP to consider leasing space at CapMetro’s offices. He cited a cash crunch in local government, pointing to the city’s “serious budget challenges” and Austin ISD school closures.
The board pulled the item and ATP said it would look at other options, as Watson requested.
ATP’s proposal would have put the taxpayer-funded agency into 51,576 square feet of Class A office space — a term used to describe the highest end commercial space in a city. The 22-story high-rise at 100 Congress Avenue opened in 1987 and has since been renovated.
ATP’s lease would have cost up to $32 million over 7.5 years. The agency also delayed a separate $15 million contract with CBRE to finish out and equip the 2.5 floors of space. Almost half that cost, $6.7 million, would have been reimbursed by the landlord.
ATP told KUT News in a statement that its workforce is growing from 200 to 300 people as it brings on more contractors with the goal of opening an all-electric train system by 2033.
The agency said it has outgrown existing office space at 203 Colorado Street and needs another 15,000 square feet. The statement said ATP has been located downtown near the light-rail route “since day one.”
Documents obtained by KUT News show CapMetro has about 36,000 square feet of unused office space at its headquarters on East Fifth Street, and 7,700 square feet of unused office space at the CapMetro Transit Store at 1705 Guadalupe Street, which sits on the path of light-rail.
ATP declined an invitation to participate in a standalone KUT Festival panel that would have preceded this conversation.
The existing panel, however, included State Rep. John Bucy III, D-Round Rock, who has defended Project Connect against attacks in the Legislature. Also on the panel was Bill Aleshire, an attorney and former Travis County Judge who has filed suit to stop it.
The panelists sparred over whether changes to Project Connect validate ongoing legal and legislative challenges to the plan, or whether those efforts are seeking to overturn the will of Austin voters.
In 2020, Austinites approved a property tax increase to fund the long-term transit plan, including the first phase of light-rail line that would span 20.2 miles and include a downtown subway system. Since then, the light-rail component has been scaled back to 9.8 miles with no downtown subway.
Aleshire, whose lawsuit represents clients that include business owners along with current and former Democratic politicians opposed to Project Connect, said changes that have been made require voters weigh in again.
“Project Connect is an illegal, unaffordable, special-interest-driven, cataclysmic mistake,” Aleshire said during the KUT Festival panel. “They need to go back to the voters because what they are doing now is nothing like what the voters approved in 2020.”
The Federal Transit Administration recently granted environmental clearance for the project, moving Austin one big step closer to building the system with all-electric trains arriving every 5 to 10 minutes from 15 stations.
But the agency is still waiting for a decision on a crucial component: up to $4 billion in federal funding.
Bucy said the project is moving “full steam ahead” and ATP is working with the federal government “step by step to get this done.”
But even if federal funds don’t come, Bucy expects the light rail component to remain in some form.
“The voters said build as much of the project as you can,” Bucy said. “That’s in the contract with the voters. That is what the city of Austin voters approved overwhelmingly. And that’s what they’ve asked the city to move forward to do.”
