The City of San Antonio’s proposed budget for 2022 is above $3 billion for the first time in the city’s history.
Fueled by some increased sales, hotel taxes revenue and federal recovery funds this year, the proposed 2022 budget is slightly heartier than 2021. It’s about a 4% increase. The city has restored cuts made in 2020 and 2021 to their full capacity, such as its street maintenance program. However, the potential medical and economic strain from the coronavirus’ delta variant has created some uncertainty.
San Antonio City Manager Erik Walsh said the city is prepared to shift its attention should management of the coronavirus surge go awry and resources such as federal grants continue to be in the city’s possession.
“The speed at which everything has happened over the last three weeks — who knows what the next three weeks are — could be a hell of a lot worse than January. But I'm confident that with those resources and the ability to turn the knobs and (if) council makes changes in the adopted budget, that we will be prepared,” he said.
The city’s entire proposed budget for 2022 is $3.1 billion. About $1.3 billion of that is the city’s general fund which provides the operations for the majority of city services like police, fire, libraries, solid waste and other departments. Walsh said there would be a greater emphasis on San Antonio Metropolitan Health District, the city’s health department.
“From my view, public health departments are a little bit like fire departments after 9/11 right now, even though ... we are in a bit of a surge right now and not through, but the aspects of what we've learned are going to be key to address as we go forward,” Walsh said.
The city’s sales tax revenue has risen 11% from 2019, when the average annual increase in sales tax revenue is about 4.5%, a climb that Walsh attributed to pent-up demand. While tourism saw an increase in 2021, hotel occupancy tax (HOT) revenue has not recovered from pre-pandemic levels, it’s still 24% less than in 2019.
The rise of the delta variant is starting to affect the city’s convention business with at least two large conventions suspending their upcoming visit to the city. Walsh did not immediately say which two, however.
“Those are decisions that the clients are making on their own. So we're going to be watching it very closely. And it's another reason why we should be somewhat conservative on some of our areas of business,” he added.
This summer, the city received $163 million from the federal government’s American Rescue Plan Act. That’s a half payment; the city will receive a second fund of the same amount next year.
Of that ARPA money already in hand, the city will use about $97.5 million over the next three years. About $50 million is going into the HOT fund to offset some of the pandemic-induced losses. The HOT fund provides funding departments like arts and culture and tourism-centric operations, like the sports facilities and convention center department.
The remaining amount of unused APRA money — about $70 million — is being held in reserve until the U.S. The Treasury Department provides guidance on how to use it. It may also be used to respond to the pandemic should it become urgent enough.
Under the proposed budget, the San Antonio Police Department will increase by about 3.8%. An increase that’s on par with previous years; over the last 10 years, the police department’s budget has gone up about 3% every year.
The budget calls for adding 15 new officers. That includes 12 officers for the San Antonio Fear Free Environment (SAAFE) program which has officers patrol specific neighborhoods on a regular basis and three officers to the downtown bike patrol. The addition will cost about $1.8 million and would be a permanent addition to the department.
Over the last few months, the city has been gathering citizen input on what role the police department should play in response to certain calls in a series of nearly 30 public meetings. As a result, the city will shift officer responsibility for certain calls.
For instance, calls for animals such as barking dogs will be sent to Animal Care Services instead of the police department. Calls regarding fireworks will be sent to the San Antonio Fire Department arson division. The city will also use code enforcement to respond to loud music calls instead of police at first, and the city is also exploring a combined approach to calls involving mental health. None of responsibility shifts would affect the police department's overall budget.
During that series of meetings, citizens expressed the need for more streetlights. The volume of which Walsh said took him by surprise.
“I was not prepared for the number of times street lights came up. I mean, that was a real issue. So we wanted to make a big investment of that next year,” he said.
The city would spend about $5.8 million in assessing the need and implementing more street lights under the proposed budget.
The San Antonio City Council will provide wide input during its review of the proposed budget Thursday, which will lead to a month-long review process before the council adopts the final version on Sept. 16.
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