SAN ANTONIO – Before plans for a proposed Spurs arena downtown were announced, a piece of legislation was filed by Texas Sen. Jose Menendez (D-San Antonio).
In 2023, Menendez authored Senate Bill 2220, which gave cities like San Antonio the ability to capture state tourism and hotel tax dollars and reinvest the revenue in the city.
In an interview with KSAT, Menendez stated that the move was necessary as other Texas cities are building new arenas and attractions. Menendez pointed to projects in Fort Worth, Dallas and Houston as evidence that cities across the state are competing aggressively for conventions, concerts and sporting events.
“This is not about the Spurs, in my opinion. This is about us bringing new conventions, new events, new meetings to San Antonio,” Menendez said.
Menendez said the bill allows San Antonio to retain more state tourism and hotel revenue for local reinvestment. He added that the state law for this funding mechanism protects Bexar County taxpayers.
“I’ve reviewed the terms, I’ve looked at them. I think that there is a great deal of security and fairness for the taxpayer,” Menendez said. “If we don’t get in on this, we’re going to be at a disadvantage. And I never want to allow our community to be at a disadvantage,” he said.
Fort Worth used millions in state tourism dollars under a similar law to help build Dickies Arena downtown.
Since opening, the city-owned venue has attracted high-profile concerts, basketball tournaments, the U.S. Gymnastics Championships, and an expanded rodeo. The Kay Bailey Hutchison Convention Center in Dallas is being financed partly through a Texas Project Financing Zone (PFZ).
Menendez cited Fort Worth’s experience as proof that the funding model can spur broader development.
“If the people in Fort Worth thought it was a bad deal, they would have come back in 2025 and said, ‘Hey, can we renegotiate?’ They have not. You know what they’ve done? They’ve tried to expand,” he said. “They love it so much. They’re like, ‘yeah, no, let us build more with these tourist dollars.’”
According to the NBA, since 2010, seven teams have opened new arenas, and one more — Oklahoma City — is scheduled to break ground next year.
Six of those teams received public funding; only the Los Angeles Clippers and Golden State Warriors did not, in two of the NBA’s largest markets.
Watch below: How this has worked in other cities
According to NBA data, small-market teams that built new venues received public funding covering between approximately 40% and 95% of their construction costs.
The San Antonio Spurs have committed to paying roughly 38% of a proposed new arena’s construction costs and to covering cost overruns, SS&E officials have said.
Menendez said the effort is not intended as corporate welfare. “I’m not a fan of any corporate type of welfare, and I don’t think this is about corporate welfare. I think this (is) about investing in the city’s future,” he said.
He added that policymakers must strike a balance between efforts to attract new dollars and investment and protections for long-time residents.
“It’s important for us to find that balance as we’re trying to attract new dollars and new investments in our community,” Menendez said, urging officials not to lose sight of people who have lived in the city for years.
Bexar County residents will vote on Propositions A and B on Nov. 4. Prop B would allow the Spurs to use $311 million in state tourism and visitor tax dollars to help build the arena. The City of San Antonio has already agreed to a term sheet to fund $489 million in tourism and visitor tax dollars.
In comparison, the Spurs have committed $500 million, as well as covering construction cost overruns, for the $1.3 billion proposed arena.
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