This story has been updated.
The administration of a combat support agency that oversees medical services for the military, employing tens of thousands of civilian and service members worldwide, could soon call San Antonio home.
“The city has been in conversation with the Defense Health Agency for some time,” said City Manager Erik Walsh. “They’re finalizing their plans to potentially relocate their missions here in San Antonio.”
The Defense Health Agency, a joint, integrated support agency that manages all military hospitals and clinics and the TRICARE network, employs tens of thousands of civilians and military service members worldwide.
Exactly how many jobs would be moved to San Antonio — where the agency already has a large footprint, Walsh said — or when the decision to relocate will be announced, is uncertain. But “when it is, it would be a big deal,” said Walsh.
A $10 million budget set aside in the fiscal year 2024 City of San Antonio budget being considered on Thursday would go toward ensuring the agency’s administrative functions can relocate to Joint Base San Antonio-Fort Sam Houston.
“We’ve been involved in conversations over the past few years to accommodate a potential personnel consolidation at Fort Sam Houston,” said Mayor Ron Nirenberg.
“There would be no better city than San Antonio for such a move, and it would be an incredible opportunity for furthering the partnership between the military, our residents, and our local economy,” Nirenberg said.
Bexar County also set aside $10 million for the same project in its proposed budget presented on August 22.
While the agency already conducts some operations on the Army post, it could grow substantially, bringing more jobs.
If it does, the funds to support a move are being set aside now. The budget includes $5 million in both FY 2025 and 2026 as “unissued certificates of obligation,” or bonds, to renovate Fort Sam Houston Building 2371.
Also known as South Beach Pavilion, the four-story building has over 109,000 square feet of office space, according to the commercial real estate listing site, Loopnet. The Beach Pavilion buildings were built in 1931 and converted into a hospital during WWII.
In relocating to San Antonio, the Defense Health Agency would become neighbors at Fort Sam with Brooke Army Medical Center (BAMC), the Department of Defense’s largest hospital and only Level 1 Trauma Center.
In addition to BAMC, San Antonio is also home to the San Antonio Uniformed Services Health Education Consortium and the U.S. Army Institute of Surgical Research.
The presence of military medicine and research also could soon expand on the city’s East Side if leaders with the Texas Research and Technology Foundation achieve their goal of attracting various Department of Defense institutions to VelocityTX and the proposed Sutton complex.
A year ago, the Henry M. Jackson Foundation for the Advancement of Military Medicine selected San Antonio for its annual awards gala, the first time it’s hosted the event outside the nation’s capital where the 40-year-old nonprofit is based. Local officials attended alongside top military brass.
The $10 million placeholder item is in the capital improvements section of the budget and is notated as a “Mayor and City Manager commitment to Defense Health Agency.”
The renovation project and its cost likely would be supported by state grants, Walsh said.
Talk of the agency consolidating in the region has been ongoing for a couple of years, said Jenna Saucedo-Herrera, president and CEO of Greater:SATX.
“It would require significant capital investment from a variety of institutions so it’s great that that’s captured in [the city’s] budget,” she said. “That just means that they’re serious about ideally preparing for that level of consolidation.”
Saucedo-Herrera said it could mean “a few thousand” people moving to San Antonio, but that hasn’t been finalized yet.
The move would be great for the city, she added. “But we need to invest in the facilities to be able to accommodate them.”
Established in 2013, the Defense Health Agency manages medical enterprise services for the U.S. military around the world.
In 2017, as a result of congressional mandates, the agency began to directly manage the military hospitals and clinics for all service branches, and integrate military health care with the TRICARE network of providers.
Previously, the individual armed services managed most aspects of military health care.
The agency is led by Army Maj. Gen. Telita Crosland, who took over as director in January. Crosland is board-certified by the American Board of Family Medicine and most recently served as the Army deputy surgeon general.
In San Antonio, civilian employees working in the military health care system, including Brooke Army Medical Center and the 59th Medical Wing, were transitioned to the Defense Health Agency last year. Service members were not affected by the transfer.
In 2021, San Antonio lost to Huntsville, Alabama, its bid to house the Space Command, a functional command of the Space Force, established by the 2020 National Defense Authorization Act.
On Friday, the city manager’s office responded to questions about the Defense Health Agency item in the draft budget with an email statement that said it is meant to “support a potential consolidation of military personnel on Ft. Sam Houston.” The agency’s personnel are located in various buildings on and off area military properties, it said.
“However, conversations are still in the early stages, and there is no defined project to share at this time,” said the statement.
