SAN ANTONIO – Bexar County Judge Peter Sakai has the green light to negotiate using a county tax to fund a new downtown San Antonio Spurs arena.
However, based on Bexar County Commissioners' conversations on Tuesday, the NBA franchise likely won’t get the tax’s full capacity as the county tries to maintain the team’s current home on the East Side.
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Commissioners voted 4-1 on Tuesday to allow Sakai to begin negotiating an agreement with the San Antonio Spurs and the City of San Antonio about using the county’s venue tax to help fund an arena planned for the southeast corner of Hemisfair. The area is located across Interstate 37 from the Alamodome.
The talks would also include plans for the Spurs' current home — the Bexar County-owned Frost Bank Center — and the Freeman Coliseum grounds.
A deal would need the full Bexar County Commissioners Court’s permission. Any use of the tax would also require voter approval.
The Spurs have been eying the county’s venue tax on hotels and short-term car rentals as a possible funding source, but Sakai refused to place the tax onto the May ballot last month.
At the time, Sakai said the county needed more due diligence and information. On Tuesday, he said the city still needs to brief the county on its wider plans for Hemisfair, known as “Project Marvel,” including its revenue and cost projections.
"I want them to understand that the only way we move forward is we bring the necessary stakeholders to the table, so to speak, so that we can then get the information in which we then can decide whether the county will commit to anything, including an election of its venue tax," Sakai said.
Bexar County Manager David Smith said the county has $397 million of capacity for new projects at the current tax rate. If voters agreed to raise the hotel portion of the tax, the capacity could grow to $448 million.
But Sakai and other county officials emphasized they also have a responsibility to maintain the Frost Bank Center and Freeman Coliseum, which are estimated to need at least $100 million worth of upgrades and help improve the surrounding area.
The tax has been used in the past for projects like San Antonio River improvements, performing arts and amateur sports facilities.
“That pool of money is the pool of money you have to do all of those things,” Smith said.
The next opportunity to put the venue tax on a ballot is the November election.
The total price tag for a new arena hasn’t been made public, but county officials are assuming it would be over $1 billion.
Precinct 4 Commissioner Tommy Calvert, whose request to join in the discussions went unsupported, was the only one to vote against letting the judge proceed with negotiations.
COPS/Metro leaders also told commissioners they opposed the use of the public money to help fund the arena.
TAX PARTICULARS
Voters passed the county’s current venue tax — split between a 5% tax on short-term car rentals and a 1.75% hotel tax in 1999 — to fund the construction of the Spurs' current county-owned home, now known as the Frost Bank Center.
In 2008, voters agreed to use the tax for river improvements, sports facilities, performing arts facilities and community arenas.
The tax brought in $34 million last year and is still being used to pay off the debt from the 1999 and 2008 projects.
State law allows the county to raise the hotel portion of the tax to 2%.
More coverage of the San Antonio Spurs' potential move downtown on KSAT: