BEXAR COUNTY, Texas – Bexar County commissioners got their first look Tuesday at a proposed budget designed to tackle a looming financial crunch, and by most accounts, it’s already making a dent.
The proposed fiscal year 2026-27 budget comes in at $2.6 billion, down from $2.8 billion last year. More importantly, the proposal has already shrunk a projected future shortfall from $145 million down to $42 million — and pushed that deadline back by a full year.
But county leaders were candid Tuesday: the job isn’t finished.
How did the county get here?
Two major forces are squeezing Bexar County’s finances — and both hit at the same time.
Property values dropped 1.3% this year, the first decline in recent memory. Since property taxes make up roughly 80% of the county’s day-to-day revenue — funding everything from the sheriff’s office to the courts to road repairs — even a small drop has a big impact.
On top of that, nearly $400 million in federal pandemic relief money the county has been relying on to fund services is running out. All American Rescue Plan Act funds must be spent by the end of 2026.
County Manager David Smith told commissioners Tuesday the situation is unlike anything he’s dealt with in years.
“It was one of the more challenging budgets I’ve been involved in,” Smith said, “simply because we don’t often experience a literal drop in property tax revenues.”
No cuts — but no growth either
County Budget Director Tanya Gaitan quickly reassured the public that services are not being slashed.
“We’re not cutting,” Gaitan said. “We do not have to find a cut of $145 million in our current budget. What we had to do was slow down the growth.”
Here is how the proposed budget does that:
- County departments requested more than 240 new positions. The proposed budget approves zero net new hires in the general fund.
- Jobs that were funded with pandemic relief money will be allowed to expire rather than being absorbed permanently into the budget.
- New capital spending has been cut to just $18.6 million — a fraction of the hundreds of millions approved in recent years.
- The county is shifting $20 million from its flood maintenance fund into the general fund to shore up day-to-day operations.
- Commissioners’ discretionary outside agency funds were cut from $400,000 to $300,000 each.
Those moves are already working. The proposed budget has shrunk that projected future shortfall from $145 million down to $42 million and pushed the timeline back by a full year, to fiscal year 2029-30.
But the county isn’t fully out of the woods. Officials say they will still need to find roughly $30 million in either new recurring revenue or spending cuts by fiscal year 2027-28 to keep the budget on track long-term.
A warning about what’s coming
Even with progress on the shortfall, Smith used Tuesday’s presentation to sound an alarm about future costs the county cannot avoid, particularly roads and flood control in fast-growing unincorporated areas.
“As we look ahead, I’m mindful of the potential bill that we will have, and it’s legitimate,” Smith said. ”It’s not a ‘nice to have.’ These are major roads.”
Smith said a former county official estimated the county could spend $700 million on flood control alone across just six known projects — and that figure doesn’t include a full countywide assessment of needs.
No tax hike — for now
The proposed tax rate stays at just under 30 cents per $100 of property value, unchanged from last year. At least one commissioner made clear he wants to keep it that way.
“We don’t have to raise taxes,” said Precinct 3 Commissioner Grant Moody, “and I’m not going to support a tax rate increase.”
County employees will not receive a cost-of-living adjustment under the proposed budget. However, workers on existing step plans and career ladders will continue to receive their scheduled pay increases. Commissioners have approved pay increases totaling more than 23% since 2019.
What’s next
Tuesday’s presentation required no action from commissioners. Work sessions are tentatively scheduled for Aug. 25 and Sept. 3.
The final budget and tax rate vote is set for Sept. 15.
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