Bexar County commissioners voted Tuesday to spend $10 million to renovate a local military facility for the Defense Health Agency (DHA).
The facility will allow the Falls Church, Va.-based agency that oversees medical services for the military to consolidate some leases at the South Beach Pavilion on Fort Sam Houston.
The agency plans to bring additional staff to San Antonio, initially up to 650, according to county officials.
With approval from commissioners, the county will create a proffer letter, offering to contribute funds from the county’s capital budget for the project and also to lead the exterior renovations on behalf of the agency.
Additional funding of $10 million will come from the City of San Antonio, which committed to the project in October, and $5 million in expected state grants, for a total of $25 million.
The proffer letter is the first step toward implementing the project, said Dan Curry, director of the county’s facilities management department. The letter next heads to the city for signature and to JBSA command leaders for approval.
Projects costing over $750,000 must then go before Congress. If approved, development agreements will be brought to commissioners court at a later date.
“This project has been in the background for a little while,” Curry said. Plans are already drawn up and the scope of work determined.
The 130,000-square-foot building needs upgrades and modernization for future use, he said, “so there was an effort through the city and the county to provide some needed funding to get that project kind of off the ground.”
In 2023, City Manager Erik Walsh said the city had been in conversation with the DHA “for some time.”
In San Antonio, DHA would become neighbors at Fort Sam with Brooke Army Medical Center, the San Antonio Uniformed Services Health Education Consortium and the U.S. Army Institute of Surgical Research.
The growth of military medicine and research also is anticipated on the city’s East Side as leaders with the Texas Research and Technology Foundation work toward attracting various military-related institutions to VelocityTX.
Commissioner Grant Moody (Pct. 3) said military leaders visited the South Beach site recently and supported the project.
“There are other leaders in the Pentagon behind this project, but we needed to show traction,” he said. “We needed to show we were making movement, and we are with this proffer letter. So I’m excited to support it, and we’ll continue to try to move this project forward.”
Plans call for the county to serve as the lead entity to fully restore the 1931 South Beach Pavilion building according to historic standards and to prepare it for the finish-out, Curry said. The interior work, including sheetrock and flooring along with furniture and moving costs, will be funded by DHA.
County Judge Peter Sakai said the agency’s plan to relocate some missions to the city, though not its headquarters, is a game changer not unlike Toyota’s recently announced expansion which brings new jobs.
“They’ll be medical positions, and presumably they will be high-paying positions,” Sakai said. “So, what we lost in the consolidation of Army North, Army South commands, I think we’re regaining a significant amount of investment … so this is a win-win for our community.”
But Moody said he thinks the agency could continue to expand even further in San Antonio.
“I don’t think 600 is the end of it, but we’ll continue to advocate,” he said. “I think San Antonio and the military medicine we have here is a differentiator for our community.”
This story originally appeared in the San Antonio Report.