San Antonio City Manager Erik Walsh speaks during an event. Twitter / TPRNews" class="uk-display-block uk-position-relative uk-visible-toggle"> click to enlarge San Antonio City Manager Erik Walsh speaks during an event. - Twitter / TPRNews
Twitter / TPRNews
San Antonio City Manager Erik Walsh speaks during an event.
A showdown between first-term San Antonio Mayor Gina Ortiz Jones and longtime City Manager Erik Walsh appears to be shaping up as City Council prepares to meet Thursday to discuss plans for a new Spurs arena.
Despite Walsh finalizing a non-binding term sheet with Spurs Sports & Entertainment (SS&E) on Sunday, Jones is still calling for a strategic pause in talks with the team along with a second economic impact study on Project Marvel, the $4 billion sports and entertainment district that would be anchored by the proposed NBA arena.
With Jones and a many on council unable — or unwilling — to find common ground, Thursday's meeting could be shaping up to one for the books. Walsh is the city's most powerful unelected bureaucrat, and he appears to have a hefty swath of council in his corner.
District 10 Councilman Marc Whyte, who's been among Jones' most outspoken critics on the dais, told on News4SA that a majority of council opposes Jones' pause.
"Does she want the deal to fail altogether? Nobody really knows," Whyte told the TV station Monday. "But again, the people who understand the numbers know that we have an [economic impact study] that gives us all the info we need."
Under the set of terms negotiated by Walsh at the behest of a majority of council, the city would front $489 million for a new $1.3 billion downtown basketball arena. Bexar County would also chip in $311 million if voters approve a 2% visitor tax increase in November. However, if the county measure fails at the ballot box, the term sheet would be come null and void.
The city's portion would come from a mix of funding sources, including a Project Finance Zone (PFZ) — visitor tax money collected around Hemisfair that would otherwise go to the state — and money from a Tax Increment Reinvestment Zone (TIRZ). However, before the city disperses money for the arena, SS&E will have to commit $500 million in surrounding development with investment and construction partners lined up.
TIRZ funding comes from property tax increases around Hemisfair. SS&E, per the term sheet, is pledging $1.4 billion in additional development within the TIRZ. SS&E will organize that development with partner developers and include a boutique hotel.
The $900 million from SS&E to pay for surrounding development will disperse over a 12-year period, according to the term sheet. However, what the remaining development might entail, remains unspecified in the document.
What's more, SS&E has tentatively committed to pay for the rest of the arena not covered by the city and county, along with any cost overruns. It remains to be seen what those overruns might look in a high inflationary environment exacerbated by President Trump's trade wars.
City Council will vote on the non-binding term sheet at Thursday's A Session, and the agreement will require a majority backing to pass.
Jones has as a proposal of her own.
Also on A Session's agenda is an item added by the mayor, which would halt all negotiations with SS&E on a new arena until the city conducts another economic impact analysis on Project Marvel. Jones argues the first economic impact study conducted by CSL International is flawed because Sixth Street Investments, which owns the consultancy, also holds a 20% stake in SS&E.
The firm contracted by the city to analyze Project Marvel must have "no association with the Spurs organization or ownership," according to Jones' agenda item.
Under Jones' proposal, each of the 10 council members also would be required to host two in-person, publicly announced forums with their constituents to receive feedback about the study and the proposed term sheet.
It's unclear how long Jones' proposal would take to complete.
Per the proposed agreement hashed out by Walsh and SS&E, it will take nearly five years for the new Spurs arena to be designed and constructed, setting the facility up for an opening in 2032 — the same year the Spurs' lease on the Frost Bank Center ends.
San Antonio's Fox29 late Sunday reported that SS&E officials are "frustrated" with Jones' proposed agenda item.
However, Jones has repeatedly stressed in media comments that she's not opposed to a new Spurs arena nor Project Marvel. Instead, she wants to "look at all the data" before moving forward.
The majority of council members didn't respond to the Current's request for comment when asked what their stance was on the mayor's proposal.
The Project Marvel showdown at City Hall will commence at 9 a.m. Thursday.
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