SAN ANTONIO – There’s finally at least one rough number related to funding a new, downtown Spurs arena.
A potential $175 million tax proposal Bexar County voters could be asked to consider in November, though, it is just one of several funding streams being considered.
Spurs Chairman Peter J. Holt says it’s too soon to say how much the team could kick in to build the arena, which has been estimated to cost between $1.3 billion and $1.5 billion, but he says public money has to be involved.
“The structure that’s been in place for 25 years for the Frost Bank Center allowed for the Spurs to punch above our weight. Look at the other teams that have won five championships in the NBA: the Lakers, the Bulls, the Boston Celtics. Is there a common theme of those? They’re not in the bottom size of markets,” Holt told reporters Tuesday.
“We’re the 26th largest market in the NBA. We’re one of only four other teams that have had the same ownership since the Holt family has been involved. And so, for us to enable the future decades of success, like we’ve had for 25 years, there has to be a collaborative partnership. There just has to — it has to have that."
Venue tax vote
Bexar County Commissioners voted 4-1 Tuesday to send a venue tax proposal to the Texas Comptroller’s Office for approval — a key step before they can put it in front of voters on the November ballot.
The county wants to use the existing tax on hotel stays and car rentals to fund improvements to the Frost Bank Center, Freeman Coliseum, and coliseum grounds, as well as help fund the proposed Spurs arena at Hemisfair.
The “Coliseum Complex” and downtown Spurs arena would be presented to voters as separate proposals, but both would include raising the hotel occupancy tax portion of the venue tax from 1.75% to the maximum 2%.
Precinct 3 Commissioner Grant Moody was the lone vote against the resolution, saying he did not approve of raising the rate.
‘Start doing the math’
The resolution commissioners’ approved did not contain specific dollar figures about how much of the tax money would go toward either project. However, Bexar County Judge Peter Sakai has repeatedly said the county will prioritize taking care of the county facilities around the Frost Bank Center.
“I don’t know what sum of money, if any, Spurs, I can give you. All you can do is you can start doing the math,” Sakai said ahead of Tuesday’s vote.
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, the now-Frost Bank Center.
In 2008, voters agreed to use the tax for river improvements, sports facilities, performing arts facilities and community arenas.
The tax generated $34 million last year and is still being used to pay off the debt from the 1999 and 2008 projects.
By raising the tax now, county officials say they can find a little less than $450 million in capacity to be spent on other venue projects.
Based on costs shown in previous presentations and numbers referenced in Tuesday’s meeting, maintaining the Frost Bank Center would take about $78 million. Improving the surrounding coliseum grounds to attract more year-round activity would take around $197 million.
That would leave approximately $175 million of tax capacity for a Spurs arena.
Spurs chairman talks funding
Holt was at Tuesday’s meeting and stated that the team’s commitment was to prioritize any action for “community positive impact” and “mutual benefit” first.
“So we very much are committed to the legacy and foundation of the Frost Bank Center and ensuring that this project allows for that to thrive, as well as the future next phase of this journey, which is a community center and an arena downtown that will allow the Spurs to thrive and we hope will enable San Antonio to continue to grow and Bexar County to have tremendous success in the future,” he told commissioners.
Speaking with reporters after the vote, Holt said the arena’s project cost hadn’t been completed yet.
“We’re gonna work together with our partners to figure out what our investment is,” Holt said. “And what I would say is ‘we’re ready to invest.’ As you just saw — or hopefully the community saw - we just put over $100 million into a new performance campus in San Antonio, and we’ve been dedicated to the building of the Frost Bank Center, to the renovation of the Frost Bank Center. We’ve put a significant investment in those, and we’re absolutely going to do the same for this project."
Asked when he anticipated putting forward a number publicly, Holt indicated it would be within the next 60 days.
The Spurs, county and the City of San Antonio signed a non-binding memorandum of understanding (MOU) that includes a commitment to try to publicly lay out their funding commitments by early July.
To put the venue tax on the Nov. 4 ballot, county commissioners have to order the election by Aug. 18.
Spurs fans have worried repeatedly whether the team could try to jump to Austin, and the fear has been tied to the reasoning for building them a new stadium.
Asked whether the team might leave if a new arena doesn’t get built, Holt said, “I think that to be very clear, there’s no Spurs without San Antonio, and there’s no San Antonio without the Spurs.
“And so, our family, our community, our leadership, the Spurs, we believe in abundance, and we know that this project is going to be transformative, and we know that it’s going to be of really high positive impact to our community and to our urban core. It’ll increase accessibility, it’ll increase options, and the economic development will be huge. And so the Spurs need this and want this to be successful, and we truly believe that our fans, our friends, the people that we live and work and go to school with are going to support this wonderful vision.”
He would not answer a follow-up question, however, about what would happen if voters were to shoot down the venue tax proposal.
Public funding concerns
Members of COPS Metro were also present at Tuesday’s meeting, reiterating their opposition to using public funds for an arena.
“Many of our families are experiencing layoffs from their jobs. And families are being squeezed with cuts to SNAP and Medicaid. And here you are proposing a venue tax for yet another arena?" said Debra Garrett, a COPS Metro leader with Holy Redeemer Catholic Church, who urged the county to spend money on raising county wages, affordable housing and infrastructure.
Precinct 1 Commissioner Rebecca Clay-Flores and Precinct 2 Commissioner Justin Rodriguez said the venue tax could only be used for approved venue projects.
Supporters also describe the venue tax as affecting visitors, not local taxpayers.
City staff have laid out several other likely sources of funding, including special tax capture zones, an arena lease and ground leases for nearby private development.
However, none of the funding has been set yet, and the incoming city council includes several new members who expressed concern on the campaign trail about how the city should proceed with the wider sports and entertainment district, known as Project Marvel.
The new council will be fully in place on June 18.