I-35 plan could displace iconic Austin spots

An iconic late-night diner, a health center specializing in the treatment of HIV and AIDS, a barbershop, a day care and dozens of other businesses are among those at risk of displacement under the plan to expand Interstate 35.

Why it matters: The Texas Department of Transportation's preferred I-35 expansion plan has left business owners in a state of limbo, wondering whether to move on or hold out until they're forced out.

By the numbers: The widening project could shutter or relocate 107 local businesses, residences and properties — that's 69 commercial lots, 24 multi-family units, two single-family units and 12 vacant lots.

• Most project displacements are located near the Upper Boggy Creek, North Loop, Windsor Park and Hancock neighborhoods.
• Eight commercial properties cater to non-white, Spanish-speaking or lower income populations, a TxDOT analysis found.

Zoom in: Among the local spots at risk of closure is Stars Cafe, the 24-hour Cherrywood diner first opened in 1966 as part of the Stars Inn motel — now a Days Inn.

• The quirky diner, formerly known as Star Seeds, has long been a popular late-night spot for University of Texas students, artists and musicians.

Yes, but: The pandemic "crushed" the diner, according to co-owner Deitrich Armstrong, who took over ownership nearly 13 months ago. He fears that by the time Stars Cafe sales return to pre-pandemic levels, they'll have to close for good.

What they're saying: Armstrong tells Axios he always knew the I-35 project could be a possibility, but didn't think it would happen so soon. He and his business partner are weighing their next steps for the restaurant.

• "We would realistically love to relocate, but we also understand the impact," Armstrong said. "The main thing about Stars Cafe is you're right off the highway, you're close to campus, you're two exits away from the heart of downtown and you're still on the east side of town."

The other side: TxDOT officials have said relocation assistance is available for residents and businesses.

• The appraised value for the properties is at least $265 million, per data from TxDOT.
• "TxDOT is proposing to offer relocation assistance, beyond what is required by regulations, for displacement of community facilities that serve low-income, minority populations, or otherwise underserved communities," TxDOT told KVUE in a statement. "This would include small businesses, healthcare facilities and daycare facilities that serve those populations."

The bottom line: "It's devastating," Armstrong added. "It will be truly devastating to see all these businesses along 35 go when there are so many other options."