What defines a “public purpose?” That’s what San Antonio voters will be determining in the May 1 city elections as they decipher the challenging wording of Proposition A, which asks them to approve changing the City charter to expand how bond funding can be used.
As it stands, each five-year bond program that San Antonio voters approve consists of infrastructure and capital projects that are “public works”: parks, street improvements, building community centers. But most City Council members hope the next bond program in 2022 could include funding for affordable housing by changing the charter language to allow use of bond money for “public purpose.”
As written, Proposition A asks voters:
“Shall the City charter be amended to allow the City to issue bonds for permanent public improvements or any other public purpose not prohibited by the Texas Constitution or the general laws of the state of Texas, to include affordable housing programs in scope and breadth as determined by the ordinance of the City Council following an election on that matter?”
If voters vote yes, the change to the City charter would give City Council more options for the types of projects that could be included in the next bond program. The driving force behind the proposition comes from the desire to fund more affordable housing, City Attorney Andy Segovia explained earlier this year. Just up the road, Austin passed a slate of bond propositions that included $250 million for affordable housing in 2018.
San Antonio is the only major Texas city that restricts bond money to public works. The charter was amended to include that language in 1997, Assistant City Attorney Ray Rodriguez said.
The change in city charter language to allow affordable housing was a key recommendation in San Antonio’s housing policy framework, approved by City Council in 2018.
But a concern voiced by some City Council members has been that the amended language could lead to private developers becoming the main beneficiaries of the change.
“I’m concerned it is going to turn into a larger scale and perhaps abused form of funding going directly to the developers instead of those in need of immediate housing,” Councilwoman Melissa Cabello Havrda (D6) said in February. “… If we’re going to debt-fund, I want to make sure that it’s going directly to those most in need.”
In order to provide San Antonians with affordable housing options, however, the City needs developers to construct those homes, said Francine Romero, associate professor and chair of the Department of Public Administration in the University of Texas at San Antonio’s College for Health, Community, and Policy.
“People have to make a profit for this to happen,” she said. “And I would hope people would understand that, but that could be an unpleasant surprise later on.”
Councilman John Courage (D9) also said in February he did not want to see economic development projects such as sports arenas edge out affordable housing projects.
“There doesn’t seem to be a protection that affordable housing will be the primary use of these funds,” he said.
Proponents of Proposition A say the vetting process for bond projects will ensure money for projects is allocated appropriately.
How does the bond process currently work?
Every five years, the City of San Antonio asks voters to approve a bond program. In 2017, voters approved an $850 million bond package that included funding for drainage and flood control, streets, and parks. Those projects are still in progress, but in 2022, voters will have the chance to weigh in on another five-year bond package.
Before those proposals go to the voters next May, the City gathers input from committees made up of citizen volunteers. Those committees advise the City Council on potential bond projects or priorities, which Rodriguez said ensures that taxpayers have input into how bond money is used.
Those citizen bond committees would still be in place if Prop A passes, Rodriguez said. And voters still have the final say on how the City spends its bond dollars.
“We’re not changing the process at all,” he said. “In other words … [a bond proposal] would still have to go through City Council for approval to put on a ballot that citizens would still have to approve. And if they didn’t want it, they’d vote it down and it’s done.
Passage of Prop A gives the City “no additional powers, other than to put [affordable housing programs] on a ballot,” Rodriguez said.
What new projects would be allowable if Prop A passes?
Each potential use of bond money has to be vetted by the city attorney’s office, which also would consult with the Texas Attorney General on whether a bond proposal falls within the boundaries set by state law, Rodriguez said.
Currently, “public works” is understood to mean projects that require physical construction, like renovating a library, Rodriguez said. But if the charter amendment passes, bond money could be used for a “public purpose,” including intangible initiatives such as economic development.
However, those intangible proposals must still be quantified in some way, Rodriguez said. If, for instance, City Council wants to team up with an outside agency to construct affordable housing using bond money, the city attorney’s office would come up with a proposed structure for that deal and ask the attorney general to review it, Rodriguez said.
This charter change likely wouldn’t mean the City would get into the business of building affordable housing; it would more likely be done in partnership with established developers, nonprofits, and the San Antonio Housing Authority, Romero said.
Constructing a clinic in an underserved area could also be considered a public purpose, but also a public work, Rodriguez said, so efforts of that kind would still be applicable under current bond money guidelines. If a clinic needed help with staffing and that was deemed to be a “public purpose,” staff salaries potentially could be funded with bond dollars if the proposition passes. But again, that proposal would have to be reviewed by the City, the attorney general’s office, and vetted by a citizens committee, Rodriguez stressed.
How do San Antonians feel about Prop A?
San Antonians generally seem to support the proposition but a significant number were undecided, according to Bexar Facts polling conducted in late March. Fifty-six percent of respondents to the most recent Bexar Facts survey said they were at least leaning toward approval, while 27% said they were thinking about voting against. Seventeen percent were undecided.
Even though the proposed charter amendment would not only affect affordable housing funding, how people feel about that issue would likely drive the way they vote, Romero said.
“For people who support affordable housing, even if they don’t fully understand it, they’ll say yes, and people who don’t want any public money for affordable housing, they’re just going to say no, and that’s fine,” she said. “But then there’s a whole other aspect to this, which, even though it doesn’t seem like the immediate intent, is to use this flexibility for something other than affordable housing.”
Councilman Clayton Perry (D10) was the lone council member to vote against putting Proposition A on the ballot. He said he was uncomfortable with expanding the use of bond money and potentially siphoning bond money away from infrastructure projects like street improvements and drainage.
“Basically, we’re giving the City Council a blank check to basically fund anything that they want to fund with bond dollars,” he said. “The bonds were set up originally in the mid-90s to help fund infrastructure projects like streets and drainage and building things that we’re responsible for across the city.”
“We get hundreds of millions of dollars every year from the federal government for affordable housing, so we’re already getting funds to that in those categories,” he added.
Councilman Roberto Treviño (D1), who supported the charter amendment, said an additional funding boost for affordable housing is still needed. Data from 2016 already showed there were 50,000 San Antonio residents who pay more than 50% of their income for housing, he said. Housing should at most cost no more than 30% of someone’s income, according to the U.S. Department of Housing and Urban Development.
“The vast majority of folks who have received assistance from our emergency housing assistance program are folks who are making basically a third of the area median income or less,” Treviño said. “And that’s very problematic. … We’ve got to really do everything that we can to create more housing.”
Prop A simply allows San Antonio voters to have more options in how it invests public money, said Pedro Alanis, executive director of the San Antonio Housing Trust.
“In the past, a lot of that [bond funding] has been focused on things like streets and drainage projects, which are all fine, he said. “But you know, San Antonio’s housing system is a part of the overall infrastructure system. It is every bit as important as our streets, roads, bridges, highways, our transit system, our sewer and water systems, our electric grid systems, our health system, and education systems.”
Treviño added if Prop A passes, the charter amendment would not cause bond money to be spent without scrutiny.
“A future Council can maybe pick a project or promote a project [that seems inappropriate] but ultimately, the way it works though is that that will have to be decided by the voters,” he said. “That’s almost kind of like a safety valve for that.”
Senior reporter Iris Dimmick contributed to this article.