SAN ANTONIO – Bexar County funding for a new Spurs arena is on the ballot this November.
If passed, it would allow the county to use hotel and car rental taxes to pay for a portion of the funding for the $1.3 billion arena downtown, which would also be funded by the City of San Antonio and the Spurs.
This KSAT Explains breaks down those funding sources and how they will affect taxpayers.
Watch below: KSAT breaks down San Antonio’s downtown Spurs arena, including the cost, impact and what’s at stake
Ahead of the election, KSAT asked viewers to submit their questions about plans for the new arena.
KSAT’s Myra Arthur asked Spurs Managing Partner Peter J. Holt those questions in a sit-down interview.
WATCH THE FULL INTERVIEW IN THE VIDEO PLAYER BELOW.
Read below for a Q&A that has been edited for clarity and brevity.
KSAT’S MYRA ARTHUR: I’m going to start with the question we’re getting most often: Why can’t the Spurs pay for a new arena all by themselves? Why do you need public dollars to do that?
SPURS’ PETER J. HOLT: Yeah, it’s a great question and a couple of answers to that... We’re the 27th out of 30th in market size in the NBA. And that has always pushed us to be creative and pushed us to be scrappy and, quite honestly, pushed us to match, kind of, the energy of San Antonio of being the underdog.
The partnership that we have today with Bexar County in the Frost Bank Center used the venue tax to support building the Frost Bank Center.
We’ve proven that that’s been very successful over the past 25 years with our partnership with the county. And we want to continue that now with partnership with the county and the city, using visitor taxes that have no impact on our local citizens.
Of the 30 NBA teams, there’s only three that have been privately-financed. Twenty-seven have a public-private partnership.
The fact is that our market size is a direct correlation in the ability to pay for things.
ARTHUR: Both the city and the county have said they will use hotel occupancy taxes and car rental taxes. So, a tax on anybody who rents a hotel room and a tax somebody who rents a car. That’s why this has been coined the “tax on tourists.”
One viewer asked us: hotel occupancy taxes would be used to help pay for the new arena, but tourism in San Antonio is down. What happens if the tax plan falls short? Who pays for that?
HOLT: So, the projections that have been done to support the arena financing are very conservative. And so they use basically very low-end tax revenue that comes from visitors to be able to support paying for the bonds that need to be issued to pay for the arena.
And I would say that if people think there is a risk to that, I would look at what’s happened for the past 25 years. So for the last 25 years, we have used the venue tax to build the Frost Bank Center. And then again, it was reauthorized by our supporters and fans in the community to do a big renovation. Now, over that time from 2000 to 2025, there’s been a bunch of cycles in our economy. There’s been a bunch of cycles in our tourism revenue. There was COVID.
So there was major disruptions to that tax revenue, yet the county and the Spurs were still able to pay for the arena and to pay for any debt that was put on to construct the arena or maintain the arena.
ARTHUR: And the Spurs are also agreeing to pay any costs that go over what the county and the city are planning to contribute. Is that correct?
HOLT: Absolutely. That’s a big part of our formula that we’ve done every time with the county.
ARTHUR: Next viewer question here: At any time for any reason, could San Antonio residents or taxpayers be negatively affected by this project, such as increased taxes other than hotel venue taxes?
HOLT: No, the funds that we are using are restricted. I think that’s important for people to know, is that these tax funds are restricted for entertainment venues, convention centers. That’s about it.
ARTHUR: Will they be hiring the bulk of architects, consultants, vendors, locally?
HOLT: Yeah, I think that there is some expertise that we’re going to have to bring in. There’s no doubt about that. But we have a history that shows that we always partner that national or global expertise with local architects, designers, construction firms. What doesn’t get outsourced is the majority of the jobs. The majority of jobs, 90 percent-plus, will be from local people.
ARTHUR: Does the public have to pay extra taxes when they go to restaurants, cafes, or extra taxes on purchases within that tax zone around Hemisfair?
HOLT: No, the sales tax stays the same. And so there’s no extra fees. They will pay their standard sales tax like they go to a restaurant today if they go visit this sports entertainment district.
ARTHUR: A big concern from a lot of viewers about parking. What will parking look like? So, this question I thought kind of hit it all here: Parking is already a challenge downtown and is too expensive at the Alamodome. How much parking will be available and what will it cost at the new arena?
HOLT: We will build in parking to allow for the density that’s needed for people to park. This project is still in the early stages of design. And so we can’t tell people exactly how many parking spaces because we haven’t done the design work that’s necessary. But our commitment is that the ingress and egress is really important to us. Logistics, parking, accessibility, the overall cost of going to a game or going to an event, those are really critical priorities to us.
ARTHUR: What happens 15 years from now if the Spurs want a new arena then? They’ve had the Alamodome, Frost Bank Center and now this possible new arena. What’s to stop that from happening in another 15 years?
HOLT: What I would say is, first, the Alamodome was not built for the Spurs, and I think there’s an unfortunate myth around that.
I think what’s unfortunately lost in this is the Frost Bank Center will have a great sustainable future with the rodeo. And the rodeo is such a positive impact on our city with the amount of scholarships and youth programming they do. So, I think the risk of that dying on the vine is low.
And then we look at this next arena for us as our super long-term future. We have no ideas or visions of a different arena.
ARTHUR: Part of the deal also includes a 30-year non-relocation agreement ... The Spurs are saying, “Hey, we’re gonna be here if this happens, we’re going to be here for another 30 years.”
HOLT: Yes.
ARTHUR: So the question then becomes, if the arena doesn’t happen, do the Spurs leave San Antonio?
HOLT: You know, we’re not focused on this election not passing. I mean, I think our belief has always been, whether it’s on the court or off the court, we have excellence and we have winning in our DNA. And so we’re confident and optimistic that this will pass, and that’s our plan.
ARTHUR: A viewer wrote to us and said, “What’s wrong with the Frost Bank Center? Why can’t you improve what you already have?”
HOLT: Yeah, a couple of things. The rough life of a building to maintain and even grow it as an NBA-standard, NBA-approved arena — the general life is about 30 years. It’s kind of why the leases are set up that way. And so, as we look at the Frost Bank Center, for us to both invest in it, to make it up to standard, or really our goal is to advance it beyond the standard for the fan experience, would take a tremendous investment of dollars into the Frost Bank Center.
We have a partner that wants to take over, and for their needs, they don’t need to invest as much money as we would need to put in it to make it viable for another 30 years.
ARTHUR: This is a viewer question I’ve got to get in: “How will this affect Wemby’s legacy?”
HOLT: You know, I (over) two days talked to Victor about this because he’s, I think, a really curious person and knows what’s going on. And I think he’s really excited about this opportunity.
I think he’s really excited about being in a world-class fan center. That’s what he talked a lot about is, how will this make the arena? How will this make, the next phase, the best home for the best fans in the world? And that was really exciting to me that he was focused on, wow, you know, Frost Bank Center is already great, what’s the next chapter for our fans so that we can have the loudest fans, the most crazy fans? Because that’s a real advantage, and Victor was really excited about this opportunity, and it’s great to have his curiosity and excitement and support.