San Antonio City Council is scheduled to vote Thursday on an agreement that sheds light on the City’s challenges when negotiating with developers whose plans may contribute to suburban sprawl.
Red Bird Legacy Ranch L.P., which is tied to billionaire B.J. “Red” McCombs’ conglomerate, plans to develop more than 1,000 acres off Potranco Road with hundreds of homes on the far West Side. Homebuilders’ advertisements for Redbird Ranch tout the development’s “great location” within the Northside Independent School District and short drive to Joint Base San Antonio-Lackland, along with its park, recreation area, and two community pools.
However, the development doesn’t match the kind of growth San Antonio officials have repeatedly signaled they want through master plans like SA Tomorrow.
Instead of a dense, infill development in the city’s urban core, Redbird Ranch will create hundreds of single-family homes 6 miles outside Loop 1604 in an area not served by VIA Metropolitan Transit. Most of the proposed development lies within Medina County, not Bexar County. Building the community will involve clearing trees from formerly undeveloped ranch land to make room for houses and roads. That will likely increase the amount of asphalt and concrete over the local watershed, worsening water quality.
Why would the City of San Antonio smooth the way for a subdivision that’s not compatible with its goals of reducing sprawl? The answer lies in a powerful tool that developers have under Texas law, according to City staff.
This tool is called “vested rights,” and it’s been a part of Texas law since 1987. Under this legal doctrine, landowners can be grandfathered out of certain development regulations, as long as they can show they had plans filed before those regulations were passed.
When McCombs Enterprises approached City staff seeking approval to create a special taxation district for Redbird Ranch, the City seized the chance to leverage that request and take vested rights off the table, said Rod Sanchez, the assistant city manager who oversees the Development Services Department. Instead, City staff wanted the new development to adhere to as many of the City’s current codes and taxing rules as possible.
“Honestly, we saw it as an opportunity to see if we could get something for the City,” Sanchez said. “We sat down and tried to get as much out of them as we could.”
McCombs Enterprises executives were not available Wednesday to respond to the Rivard Report‘s request for comment.
McCombs Enterprises needs the City’s help to create a special type of taxation district called a water control and improvement district, or WCID. Functioning a bit like tiny municipalities, WCIDs allow developers to issue bonds to pay for the construction of roads, drainage, and water and sewer service, and later reimburse themselves by levying ad valorem taxes on residents.
In exchange for the City’s consent to create the WCID, McCombs Enterprises agreed to follow current ordinances that apply to development, Sanchez said, with some other important perks thrown in. The outcome was, in City officials’ views, a good one.
Under vested rights, Red Bird Legacy Ranch has a powerful hand to play in its negotiations with the City. Because a master plan for the development was filed in 2005, Sanchez said, the development would be subject to the much less stringent building regulations San Antonio had in place at that time.
“They’re going to vest to the earliest date they possibly can,” Sanchez said of developers. “That’s just the nature of the beast.”
That’s why City staff and council members are inclined to OK the WCID deal. Not only has McCombs Enterprises agreed to follow all the City’s current regulations, but City staff also managed to secure some bonus perks.
As part of the agreement, Redbird Ranch will donate 47 acres of its land – worth about $3 million – to Bexar County that can be used to extend Highway 211, provide another 3 acres for a future fire station, and develop Galm Road to carry more traffic.
Filling the Highway 211 gap will help alleviate traffic on Loop 1604, said Councilwoman Melissa Cabello Havrda (D6). In a phone interview Wednesday, Havrda said that the City “doesn’t want to promote suburban sprawl,” but she supports the deal with developers as the best option the City has.
“A lot of people right outside our district use our resources but don’t pay [City] taxes,” Havrda said, citing the residences and businesses in Alamo Ranch as an example.
By contrast, the agreement for Redbird Ranch could allow the city to collect 75 percent of the sales tax from the area and impose development rules such as the City’s tree ordinance, up-to-date building and drainage codes, and downward-facing lighting to ensure dark skies at nearby military bases, Sanchez said,
“They’re going to develop either way,” Havrda said. “Let’s at least get something to ease the tax burden of our taxpayers. Have them adhere to our ordinances, and [let the City] get some money.”
Finally, the type of tax district Redbird Ranch seeks would allow the City to eventually annex the development and some surrounding areas without voter approval, Sanchez said.
Sanchez described everything about the deal – the credible threat of vested rights, the behind-the-scenes negotiations with developers, the eventual compromise – as “par for the course.” Other developers use the same tactics, Sanchez said.
Havrda said it “hurts a little bit” to lose more green space on the City’s fringes to development, but “there’s only so much that we can do to stifle that. … Texas is a big property-rights state.”
What the City can do to combat sprawl is further incentivize infill development in regional centers and hubs for jobs and entertainment, she said, because if it’s cheaper to develop on untouched land, it will continue to be developed.
“The problem that we run into is it’s somewhat dictated by the market,” she said. People are buying these suburban homes and “[developers are] looking at the bottom line.”
Mayor Ron Nirenberg, who also supports the compromise, compared the City’s choices to the “carrot and stick approach.”
“Unfortunately, we have limited options, and in the state of Texas, it’s almost entirely carrots instead of sticks,” Nirenberg said.
He would like to see City staff produce a growth management study in the next 90 days that establishes goals for guiding talks with developers in similar cases.
“What I would like us to do is get serious about developing a growth management strategy so that when we are presented with these kinds of developments in the future, we’re using some basic criteria to understand what our role is and what we should be expecting from that development,” Nirenberg said.