SAN ANTONIO – As San Antonio grapples with a significant budget gap projected to reach nearly $158 million, city council members find themselves at a crossroads, debating potential strategies for bridging this financial shortfall. The options on the table include drastic measures such as cutting city jobs and raising taxes.
The impending budget shortfall is anticipated to manifest in the Fiscal Year (FY) 2028 budget. However, city officials are proactively plotting a strategic two-year plan to address the looming gap. During a recent council meeting, city staff introduced a mixed approach involving new or increased fees, departmental cuts, and the potential maximization of the property tax rate.
Typically, the city has a cap on setting a tax rate for maintenance and operations, which permits a revenue increase of only 3.5% from existing properties without requiring voter approval. However, city officials can also utilize the unused tax increment from previous years, allowing for a more flexible financial strategy.
If the city opts to max out the property tax rate and utilize the increment, it could lead to an additional tax burden of approximately $81 for the average homestead. Notably, 46% of homesteads with a senior or disabled tax freeze would remain unaffected by this increase. This approach is projected to generate an additional $124.8 million over the next two years, significantly bolstering the city’s financial resources.
In addition to property tax adjustments, the proposed revenue increases totaling $21.9 million over the next two years would originate from a variety of sources. Noteworthy proposals include raising the Emergency Medical Services (EMS) transport fee, instituting a $10 fee for non-residents seeking library cards, and implementing greater cost recovery for Fiesta event expenses.
After accounting for contributions to budget reserves, the city would still need to identify $23.4 million in cuts across the upcoming budgets. Councilman Marc Whyte (D10), a vocal critic of tax increases, expressed concerns that relying on property tax hikes would merely serve as a temporary solution to an ongoing problem. He pointed to previous projections indicating a persistent deficit of $155 million by 2031, even with a tax increase.
“So a property tax increase, it’s just a Band-Aid to get us through the next couple of years. It doesn’t solve the problem,” Whyte remarked.
In response, city staff proposed an alternative strategy that avoids tax increases, outlining a plan that includes $137.7 million in reductions. This plan could entail cuts following departmental reviews across various sectors, including libraries, municipal courts, police, fire services, and human resources. Additionally, it may involve eliminating vacant positions, reallocating costs within the budget, reducing funding for delegate agencies, imposing hiring and pay freezes, and implementing direct cuts to service programs.
Overall, this budget cut-heavy approach would result in the elimination of 209 city positions, with 132 of these currently filled. This prospect has raised significant concerns among council members, particularly regarding the impact on families. Councilman Jalen McKee-Rodriguez (D2) highlighted the human cost of these potential job losses, stating, “That’s 132 families wondering what’s next and how they’re going to get their next meal.”
City staff had previously estimated the FY 2028 budget deficit at $130.7 million. However, this figure has since been adjusted to reflect new revenue and nearly $10.7 million in cuts that had already been incorporated into the FY 2027 budget during the prior year’s process.
Budget Director Freddy Martinez informed reporters that many of the proposed cuts, totaling $21.4 million over the next two years, were still included in the $137.7 million reduction plan. This includes significant cuts such as a $1 million reduction to the Minor Home Repair program and a $200,000 cut to the $1.2 million allocated for assistance to the San Antonio Botanical Garden.
Mayor Gina Ortiz Jones expressed strong opinions regarding the proposed reductions, advocating for the elimination of funding for the botanical garden, which she argued could sustain itself through ticket fees. She also suggested a significant reduction in funding for the San Antonio Book Festival, questioning the necessity of public funding for such events: “Corporate, philanthropy, foundations, like pick this up. $150K in each year? That’s nothing.”
While the recent presentation did not specify the exact nature of other proposed cuts, city staff is expected to provide detailed proposals during the draft budget presentation in August. Following this, the city council will deliberate and determine which proposals they are willing to accept before finalizing the spending plan in September.
