It’s official: voters will get a say this November on whether tax dollars are used to build the San Antonio Spurs basketball team a new downtown arena.
The team’s owners pushed to put such a measure on the ballot last May and were rebuffed by Bexar County leaders who said they first needed a plan for what would happen to the county-owned Frost Bank Center, which the Spurs would be vacating.
On Tuesday — after much deliberation on how to protect that asset — Bexar County Commissioners voted 4-1 to put a venue tax increase on the Nov. 4 ballot.
If voters approve them, the measures would bump up Bexar County’s portion of the taxes collected on hotel rooms from 1.75% to 2%, as well as increase taxes on rental cars, creating $503 million in revenue over 30 years.
Two different questions will be on the ballot. The first asks if voters are willing to spend $191.8 million for upgrades and expansions to county facilities on the East Side, including the Frost Bank Center, the Freeman Coliseum and the San Antonio Stock Show and Rodeo Grounds.
The second question will ask whether to use the remaining funds — up to $311 million — to help fund a new downtown arena for the Spurs.
County Judge Peter Sakai said the dual proposals balance long-promised development on the East Side with the Spurs’ desire to move into a new downtown home.
“The Spurs — they’re here in the room — they’re pushing me hard,” Sakai said. “They wanted a May election. I said, ‘No way.’”
Now that plans have been hashed out for the existing county-owned venues, such as year-round rodeo events at the Frost Bank Center, Sakai said: “We are now in a position to set a foundational piece for the East Side with the renovated coliseum grounds and facilities.
“This is just the start.”
Bexar County Judge Peter Sakai speaks during a County Commissioner meeting at the Bexar County Courthouse. Credit: Bria Woods / San Antonio Report
Spurs owner Peter J. Holt was the first in a long list of speakers signed up to comment on the vote at Tuesday’s meeting, praising the deal as an unheard-of investment by the Spurs organization in San Antonio compared to other NBA teams.
“For context, of the 30 NBA teams, the 14 smallest-market teams all have publicly funded arenas. The average is 70% public funds. … The most recent, Oklahoma City, is 95% funded by public funds,” Holt said.
Some teams have funded their own arenas — the Los Angeles Clippers and Golden State Warriors spent billions of dollars on their new homes.
The Spurs’ percentage of the arena’s funding compared to public money isn’t clear without a final price tag, but the team’s offer includes significant development guarantees and community investments aimed at sweetening the deal for local officials.
“This commitment shows our belief in the city, the county and having a fruitful partnership that benefits us all,” Holt said.
Rare opportunity for public input
The Spurs’ lease at the Frost Bank Center expires in 2032, and plans for the new downtown arena — part of a larger sports and entertainment district known as Project Marvel — were kept closely under wraps for more than a year leading up to a big unveiling last November at City Hall.
The City of San Antonio would own the stadium and could contribute up to another $500 million.
Unlike the county’s contribution, however, city leaders are planning an approach that wouldn’t need voter approval, making the county’s venue tax increase the public’s only chance to weigh in on the idea.
Efforts to push the project through with minimal public input had roiled opponents, including the community group COPS/Metro, which said Friday that its members were gearing up to fight the county’s proposed venue tax increase at the ballot box.
Previously, Sakai had been one of their primary allies in interrogating the use of public dollars for a closely-guarded private development. On Tuesday some made it known they were disappointed to see him align with the Spurs owners.
Araceli Herrera puts up a thumbs down while chanting outside of the Alamodome during a protest with No! Project Marvel on Monday. Credit: Diego Medel / San Antonio Report
“Where is the public process you assured us of, Judge Sakai?” said Mike Phillips, a local pastor and COPS/Metro leader. “There is no actual cost-benefit for this project, no economic analysis, no real economic analysis. This is a blank check to billionaires with our tax money.”
The city released an economic analysis last week, but that has been criticized by community members who want more information about the arena’s impact.
While several commissioners agreed they’d rather spend the money elsewhere, they argued that the taxes from hotels and rental cars (known as a “venue tax”) can only be used for limited purposes.
“If we could decide where to use venue or [hotel occupancy] tax, personally I’d put it all in mental health, keeping people from rotting in jail, preventative health, colon cancer awareness,” said Commissioner Rebeca Clay-Flores (Pct. 1). “But legally, we are the county. We are an agent of the state, and legally by state law, venue/HOT tax has to be voted on by voters. … And when they vote on this, it can only be used for certain venues.”
Commissioner Grant Moody (Pct. 3), the court’s lone Republican, cast the only no vote, citing his opposition to the tax increase.
“This deal, as written, contains a poison pill I just can’t swallow,” he said.
San Antonio City Council will discuss downtown arena funding at its Wednesday meeting with an eye on reaching a funding agreement with the Spurs by Aug. 21.