AUSTIN (KXAN) — As the Texas Department of Transportation moves ahead on its Interstate 35 Capital Express Central project, Austin city leaders are working to identify hundreds of millions of dollars to support highway “caps,” or deck plazas placed on top of sunken portions of the highway.

But with an estimated $730 million in funding sources needing to be identified by December 2024, one Austin City Council member is eyeing a possible bond election proposal to help supplement any federal grant dollars the city receives to help move that cap program forward.

In late September, Austin City Council approved submitting a federal grant application for constructing funding assistance for its Our Future 35 Cap and Stitch program. The application requested $105.2 million in funds to help finance and construct caps from East Cesar Chavez Street to Fourth Street, joined by a City of Austin match of $45 million.

The funding is made available through the U.S. DOT’s Reconnecting Communities and Neighborhoods Program. Caps can help support parks, community spaces or other public amenities atop the sunken portions of I-35.

But Council Member José “Chito” Vela said he has hesitations as to whether or not the city will receive enough funding from federal grants alone to bring the project to fruition.

“We need to look at all possible funding opportunities,” he told KXAN Wednesday, adding: “But will those (federal) sources in and of themselves be enough to pay for everything that we want to do along the corridor? I’m not sure that will be the case.”

Alongside federal grant dollars, Vela said there’s also the possibility of a tax increment financing zone developed around the corridor to aid in generating additional revenues. Aside from those resources, he said he’s in favor of looking into a possible November 2024 bond election to allow voters to formally weigh in on cap funding.

“I believe in democracy. I appreciate the fact that in Texas, we are required to go to the voters to get approval on major infrastructure projects,” he said. “This is a huge infrastructure project. And as a matter of principle, we should have to go to the voters and get some kind of feedback from the public.”

Vela said city staff are expected to come back to council in the coming months to discuss how a possible tax increment financing district would operate. He also added city leaders will continue facilitating conversations with TxDOT and the Capital Area Metropolitan Planning Organization about potential funding sources.

“I’m hoping by the end of the year, the early months of next year, we have a better idea of both what the final costs are going to be for the caps, and what the possible sources of revenue will be able to generate in order to pay for the caps,” he said.

Vela has joined several of his fellow Austin City Council members and Travis County commissioners in sharing concerns about the possible environmental and socio-cultural impacts of the project. He pointed to I-35’s historic segregation of east and west Austin, adding the expansion project moving forward sans caps would be “a worst case scenario in Austin.”

“That would be a horrible outcome that would be horrible for all of the neighborhoods surrounding I-35,” he said. “That would really hurt the vitality, economic development, the quality of life for so many people that live immediately around the highway.”

“We have to cap it,” Vela added. “We really need to create a vibrant and thriving urban environment around I-35. We cannot do that if we do not cap the highway project.”