San Antonio City Council Budget Work Session on Tax Increment Reinvestment Zones – September 3, 2025
San Antonio City Council Budget Work Session on Tax Increment Reinvestment Zones – September 3, 2025
The meeting was called to order at 2:00 p.m. on Wednesday, September 3, 2025, with a quorum present. The purpose was to discuss tax increment reinvestment zones (TIRZs), both city-initiated and developer-initiated, as part of budget planning and to explore opportunities to strengthen the general fund.
Discussion Items
- Overview of TIRZs: Chief Financial Officer Troy Elliott and Director of Neighborhood Housing Services Veronica Garcia presented on the structure, types, and financial mechanisms of TIRZs under Chapter 311 of the Texas Tax Code. They explained the difference between city-initiated TIRZs (created by council to support diverse projects) and developer-initiated TIRZs (petition-based, used to reimburse developers for public infrastructure).
- FY2025 Contributions: Total city TIRZ contribution for FY2025 is approximately $45 million – $37 million from city-initiated TIRZs and $8 million from developer-initiated TIRZs. This represents about 5% of the total property tax levy of $819 million.
- City-Initiated TIRZs: Nine zones were reviewed: Houston Street, Inner City, Brooks City Base, Verano, Mission Drive In, Midtown, West Side, Northeast Corridor, and Hemisphere. Details included establishment dates, termination dates, participating taxing entities, and balances. Notable projects include the Missions Ballpark (Houston Street), ITC property purchase (Midtown), and Hemisphere Park operations (Hemisphere). Several TIRZ plans will need updates due to recent term sheets (sports and entertainment district, missions ballpark).
- Developer-Initiated TIRZs: Ten zones were reviewed, all located primarily in Districts 2, 3, and 4. These include Mission del Lago, Lackland Hills, Northeast Crossing, Hunters Pond, Theo Meadows, Neighbors, Somerset Grove, Valley Sole, Lone Oak, and Rosillo Creek. The developer bears upfront costs and is reimbursed from the increment generated. The Rosillo Creek TIRZ, the largest, includes 5,200 single-family homes and 30 acres donated to the San Antonio Housing Trust for affordable housing.
- Affordable Housing: Staff reported 721 affordable units produced from city-initiated TIRZs and 2,300 units (54% affordable) from developer-initiated TIRZs. Four developer-initiated TIRZs have been terminated in the past three years, returning about $1.2 million to the general fund. The 2022 TIFF policy requires projects to not cause displacement and to include contributions toward affordable housing, but some recent projects (e.g., downtown sports and entertainment district, missions ballpark) do not include affordable housing components.
- Board Representation: Council members discussed the lack of council representation on some city-initiated TIRZ boards (e.g., Brooks City Base, Midtown, Hemisphere). Several council members advocated for having at least one council member on each city-initiated TIRZ board to ensure accountability and alignment with city priorities. City Manager Eric Walsh clarified that adding council members does not require a city ordinance change; it can be done by council appointment.
- Equity and Displacement: Council members expressed concerns that TIRZs have historically concentrated wealth in certain areas and produced primarily market-rate housing, while deep affordability needs remain. The displacement impact assessment (DIA) requirement from the 2022 policy will apply to the Hemisphere sports and entertainment district project.
- Future Planning: The mayor and council agreed to incorporate TIRZ policy into the broader fall budget strategic conversation, focusing on affordable housing goals, performance measures, and aligning TIRZ investments with city growth plans.
Key Outcomes
- Staff will provide a breakdown of affordable housing units by AMI (area median income) for city-initiated TIRZs, including pre-2022 and post-2022 policy periods.
- Staff will produce documentation explaining why the TIFF policy was not followed in certain projects (e.g., downtown sports district) and how adherence will be ensured moving forward.
- Staff will research how other cities use TIRZs and provide comparative analysis.
- Council requested the total incremental revenue generated since inception for each city-initiated TIRZ (not just current balances).
- The Governance Committee will review potential changes to board composition for city-initiated TIRZs to include council representation.
- A longer-term strategic discussion on TIRZ policy, including how to capture some increment for the general fund sooner, will be scheduled as part of the fall budget planning.
- The meeting adjourned at 3:46 p.m.
Meeting Transcript
Good afternoon. The time is now 2 p.m. on Wednesday, September 3rd, 2025 in the City of San Antonio budget work session is called to order. Madam Clerk, please call the roll. Council member for Councilmember Castillo Angiano. Councilmember Via Gran. Councilmember Mungia. Councilmember Castillo. Councilmember Galvan. Councilmember Alaretta Gavito. Here. Councilmember Mesa Gonzalez. Councilmember Spears. Councilmember White. Mayor Jones. Here. Mayor, we have quorum. Great, thank you, Madam Clerk. So this meeting is to hear about the tax increment reinvestment zones. You know, as mentioned, uh we are constantly looking to strengthen the general fund and understanding where money is and uh may be able to help in that regard is important. So I'm thankful that they've prepared a presentation largely on the city initiated tours to help lay flat what we might be able to do in the immediate but maybe longer term, um, as some of these are much closer to realizing the goals as initially stated when they were established. Um so Eric, over to you. Thank you, Mayor. Good afternoon, Mayor and Council. So, yes, the this was an issue that the mayor raised at our June uh budget work session. So uh from that request uh today's briefing on our uh tax increment refinance zones or otherwise known as TURS of Veronica Garcia and Troy Elliott will walk through uh will tag team the presentation today. So the presentation is an overview of the TURS, how they're structured under state law, um, how they're structured under our own ordinance uh policy, and we'll provide summary information for each of the tours. I think when the mayor brought this up at the end of June, it was um broadly about tours. There were several council members that also uh mentioned um the other type of tours we have, which is developer uh focused tours, very different. We'll walk through both of those. Um the um the information that you're seeing that you saw on the slides that we distributed and you'll see today is from the actual tours plans. Um and some of those plans um are still in the process of being updated or will need to be updated based on uh other actions. And I'll give you a couple of examples. One um when you see Houston Street tours, um we have the approved term sheet with the missions and Western Urban. Um, but based on that timeline of the um of the agreement we have with them the the um uh work around that tours and future financing, that tours plan will need to be updated and brought to council, and that was part of our original plan. Likewise, the hemisphere tours that um the council recently talked about in terms of arena, there is dependent on what happens later on this year, there's work that has to go on. Then there's other examples. Um the uh for the initial inner city tours, there's a request that I'm working on with um uh councilman uh Castillo Aguillano and um and Councilman McKee Rodriguez uh regarding the budget. These slides make no assumption around that. So that's individualized work that we need to do. Um so based on the council's conversation today. If there's follow-up, we'll do the um the specific analysis and work and report back to council. So I'm gonna kick it off to uh Troy to begin with, and then Veronica will tail in really to focus on the development tours. Thank you, Eric. Good afternoon, Mayor and Council. Um, this is my second time back in two weeks, as well as Veronica. Uh my name is Troy Elliott, I'm the chief financial officer. As Eric mentioned, I think he stole most of my introduction. But um, Veronica and I will be tag teaming. I plan on providing you with an overview of TURS, kind of how they function.
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