For years, the City of Austin has been brainstorming the possibility of capping Interstate 35 through downtown Austin to minimize noise pollution and add attractions and amenities such as green space, trails, art installations, small buildings and vendors, akin to the work already done up in Dallas via Klyde Warren Park. Last May, Austin City Council approved a $104 million plan for its Cap and Stitch project, aimed at reconnecting downtown and East Austin as well as future proofing community development opportunities down the road.
That $104 million investment called upon the Texas Department of Transportation (TxDOT) to incorporate roadway elements into the state agency’s I-35 Capital Express Central Project, with those elements designed to support highway caps (and the amenities on top of them) in the future.
“We have to seize this moment,” Austin Mayor Pro-Tem José “Chito” Vela said said back in May 2025. “If we pass up this moment, we cannot get it back.”
Now, Austin City Council is reevaluating how best to utilize those dollars amid future cost uncertainties and bleak federal funding projections. During a council work session on Tuesday, March 23, city staff recommended Austin City Council not move forward with any funding commitments this May to cover Phase 2 I-35 highway caps. During the discussion, city staff urged council stick with the $104 million investment previously made for roadway elements and, instead, work to find outside partners who can help finance capped highway additions down the road.
As of now, city officials said no private and philanthropic partners have come forward to offer funding assistance since last year. Similarly, city staff are now seeing even higher cost projections for some of the highway caps earmarked for future builds, with the 11th to 12th streets cap jump from $50 million to a projected $86 million based on design changes.
All this comes ahead of TxDOT’s May deadline for Austin City Council to decide where it wants to commit to building highway decks atop roadway elements; come November, the city of Austin would then need to commit to the funding of those highway caps.
Tuesday’s work session divvied up council members into two camps of thinking: Those interesting in continuing the $104 million commitment to the roadway elements as is, while others suggested withdrawing some of the roadway elements to instead allocate funding toward a full cap.
“If we entertain a conversation of clawing back some of the roadway elements in the spirit of trying to deliver an actual deck, an actual cap at the end of this project, I would be interested in having that conversation,” Austin City Council Member Vanessa Fuentes said at Tuesday’s meeting.
Others, including Vela, stood by his original vote last May and way of thinking.
“I would not be inclined to reconsider anything,” he said. “This is the same council, same members — there’s really no point in, I think, putting staff through additional work when we just voted on this not that long ago.”