This story has been updated.
A price tag and financing plan are coming into focus more than six months after city officials revealed sweeping plans for a sports entertainment district anchored by a new $1.5 billion Spurs arena downtown.
On Wednesday, city staff rolled out estimated costs for the massive redevelopment project known as Project Marvel unveiled in November — and how they plan to pay for it all.
But some council members said they felt decisions around the project have been rushed and not enough numbers have been provided to them or the voting public.
In addition to a $750 million expansion of the convention center, $100 million in improvements to the Alamodome, a new hotel tower and performing arts venue, the city is planning for major infrastructure improvements that could be supported by a municipal bond.
That includes reconfiguring roads, establishing more parking, upgrading public transit and establishing a residential parking program for residential neighborhoods adjacent to the district.
Also crucial to the plan is a private development partner that has yet to be named, said City Manager Erik Walsh.
The Spurs organization is working to select a developer that would be responsible for building out much of the area surrounding the proposed arena, he said. “We need the developer — that’s our priority, because that helps us kind of fill in our part of the box there … [and] what kind of guarantees there are,” Walsh said.
Funding sources
Meanwhile, the city has outlined a number of sources, including the county’s venue tax, the state’s project finance zone (PFZ), and development and leases associated with city property, to put a funding framework in place for the district.
While the Spurs have said it will pitch in to build the new arena, the organization has not revealed an actual dollar amount.
The projected cost of the land for the arena is $60 million, the appraised value of the former UTSA Institute of Texan Cultures property. The city would purchase the property with funds from the Midtown Tax Increment Investment Zone (TIRZ).
The city’s contribution to building the facility would come from the Spurs lease, existing and future TIRZ funds, ground leases from private development and incremental state revenues from the PFZ, according to a presentation by city staff.
But for Project Marvel plans to work, officials estimate a quarter of a billion dollars in improvements to roadways and other infrastructure will be needed. That cost could be funded through a general obligation bond.
On Wednesday, a city council made up of several outgoing members was asked to consider approving a bond proposal going to voters in November. An election must be called by Aug. 18 to make it on the ballot.
Bexar County is also part of the proposed funding framework. In May, county commissioners directed staff to draft a resolution for using a portion of the county venue tax on improvements to the Freeman Coliseum grounds and Frost Center that also could go on the ballot in November. What remains would also be used to support building a new arena.
The Spurs lease at Frost Center ends in 2032, and county commissioners have been intent on keeping the aging arena from being left behind when it comes to funding improvements and adapting it for future uses.
District 2 Councilman Jalen McKee-Rodriguez, whose district spans much of the East Side, supports the county’s resolve.
“Honestly, if the county is going to have some voters to approve funding through a venue tax, I think it needs to stay with the Frost Bank center in the surrounding area,” he said.
Roadwork ahead
Based on a study by Pape Dawson Engineering, at least 20 infrastructure projects would be needed over the next five years to accommodate the increased vehicles, foot traffic, public transit and parking throughout downtown.
The biggest of those proposed projects is a redesign of the intersection at Interstate 37 and East César E. Chávez Boulevard, creating a “single point urban interchange.” Plans also call for building a 2,500-space parking garage in the south lot of the Alamodome and creating a pedestrian bridge across the highway.
The roadway improvements will likely come with the involvement of the Texas Department of Transportation, Walsh said, but like most TxDOT-funded projects, the city must put up 20% of the cost.
VIA Metropolitan Transit also presented potential public transit solutions, such as maximizing use of the Robert Thompson Transit Station at 183 Montana St. for park-and-ride services, and leveraging the planned Silver and Green Advanced Rapid Transit Lines that will run through downtown.
Though infrastructure improvements could be funded through a general obligation bond if the council approves a bond election in November, city staff also are considering an affordable housing bond in 2027.
Voters approved in 2020 a $150 million housing bond that has been mostly allocated, Walsh said.
“Our municipal bond programs historically have been done with no projected increase in tax rate, and so that is still a staff perspective,” Walsh said.
Community benefits
He said that in building the funding framework and developer agreements, they are reviewing various community benefit agreements other cities have used with similar sports teams and development projects.
Some of those agreements have generated affordable housing projects, workforce training, youth programs and beautification projects. Assistant City Manager Lori Houston laid out a plan to solicit community input that will help to create the guiding principles for the sports entertainment district.
The city has contracted with San Antonio-based planning and architecture firm Able City and scheduled public meetings starting in each council district in late June. Sign up with the city for updates here.
District 1 Councilwoman Sukh Kaur asked for downtown workers to be included in any public comment sessions.
The public input process should be taken seriously, said District 8 Councilman Manny Pelaez, and explain fully why all San Antonio residents have a stake in a downtown project.
There’s “sincere mistrust for anything having to do with government and a new arena because feelings are still hurt from 26-27 years ago,” he said, referring to unfulfilled promises made when the Frost Center was built on the East Side.
Moving fast
Wednesday’s council session was a three-hour update and discussion on a project that was first revealed to the public in late 2024, with detailed renderings but few specifics. The topic comes on the heels of an agreement to also move the city’s Minor League ballpark also to a downtown location.
District 9 Councilman John Courage, acknowledging that the meeting was perhaps his last chance as a member of council to speak on a major topic, said he thinks the city is moving too fast on the project without enough information.
“I don’t see any way that talking to people in June or July or August is going to help 1.5 million people in San Antonio, or 2.2 million people in Bexar County understand all of the intricacies of these when we don’t even have the details,” he said.
“We can’t tell what the actual costs are going to be … [and] my experience has been everything always costs a lot more than you anticipate,” he added. “Why do we have to move so fast?”
Several San Antonio council members agreed they need more information in order to back the project.
Councilman Marc Whyte (D10) said he supports the project in general, but does not understand how the city could hold public comment workshops before the funding framework is more detailed.
“I continue to be disappointed that we’re sitting here at this point in time and still don’t have hard and fast numbers on how we are going to pay for this project, and specifically, the stadium,” Whyte said. “The citizens have a right to know where every dollar is going to come from for this project … time is running out.”
Budget questions
Courage also described a litany of other budget pressures the newly elected council and mayor will face, including the potential for decreased federal funding and economic uncertainty.
District 5 Councilwoman Teri Castillo said she could not support the project without more hard numbers in the funding framework, especially given the budget shortfalls the council is expecting in the coming year.
In early May, city staff gave the council a budget presentation showing sales tax and property tax revenue coming in about $10 million short of projections by the year’s end.
That led several council members to ask where the city could raise its tax rate, an option not considered in the past because property values had been rising rapidly. Walsh said that staff would not be recommending any rate increases.
The next budget meeting will be at the end of June, after a new mayor and four new council members are sworn in.
Mayor Ron Nirenberg, who leaves office when a new mayor is sworn in on June 17, said all the lengthy discussion around the project is “how the public process works,” and “what we should be doing.”
But, “if the specter of failure to reach our highest aspirations were going to stop us in our tracks from even trying, I think we’re falling short of our citizens for improving our city.”
Correction: This story has been updated to reflect the correct Tax Increment Investment Zone. It is Midtown, not Hemisfair.
