Unemployment in San Antonio could hit up to 14% this month according to projections from the City of San Antonio. There’s also a drop in revenue expected for the city’s 2020 budget amid the Coronavirus Pandemic.
The City Council formally approved an extension of Mayor Ron Nirenberg’s "Stay Home, Work Safe" order until April 9. During the special meeting, the council was briefed on the economic impacts and challenges the city could face in the coming months as it tries to flatten the curve through public health emergency declarations.
Nirenberg said the closures and stay at home orders were difficult decisions to help reduce its spread.
“It’s critically important that we’re aggressive because in this collective activity we need to limit exposure, limit human-to-human contact that would potentially spread the virus,” Nirenberg said. “It’s in that action that we can get out of this as quickly as possible, and really end this global pandemic.”
As many San Antonians find themselves at home – some without a job, the city council heard local unemployment could jump between 12 and 14% in March.
“What the economists are saying is that this event is anticipated to be worse than the economic recession, the Great Recession, that happened between 2007 and 2009,” said Deputy City Manager Maria Villagomez.
By comparison, San Antonio had an unemployment rate of 10% in October of 2009.
She added that’s an early estimate from local economist Steve Niven, who often crunches data for the city.
“The latest numbers that we have in January were about 3.2% or so, so this is a big increase on the unemployment rate here in San Antonio,” she said.
The projections come as more than 3 million Americans have filed for unemployment last week, according to figures from the Department of Labor. The Texas Workforce Commission said nearly 30,000 Texans are filing for unemployment every day.
City Manager Erik Walsh said it’s unclear what the city will look like in the coming months.
“Us, along with the rest of the country, are trying to define and understand the impact, not only what we’re going through right now but also the recovery phase,” he said. “And there's no playbook, we’re looking a major potential recession and impacts on the economy.”
The city’s 2020 budget is also anticipated to take a big hit. Villagomez said the fiscal impact could be a loss of revenue in the range of $110 million to $158 million.
That’s due to lower income from the airport, convention center, Alamodome, hotel occupancy tax and other general revenue streams like the sales tax, river barges, and municipal court fines.
“Issue number one is save lives, and then we will work to rebuild together,” Nirenberg said.
Although specifically not on the agenda, the potential rescheduling of the vote to reauthorize Pre-K 4 SA is being considered.
The one-eighth of a cent sales tax that funds Pre-K 4 SA must be approved by voters every eight years. The city council scheduled that election for May but due to the coronavirus, it’s expected to move to the general election.
The pre-k program’s board is recommending a gubernatorial order be used to reschedule it
“The health and safety of our community, including that of our Pre-K 4 SA children, families and staff remain the top priority,” Pre-K 4 SA Board Chair Elaine Mendoza said. “We respectfully request that the Mayor and City Council consider our recommendation that the election to reauthorize Pre-K 4 SA be moved to November.”
Texas Governor Greg Abbott gave cities the authorization to move May ballot items by executive order. Walsh said Pre-K 4 SA is funded to run one more school year.
“The preference was to do it in May... so that there’s certainty. Well there’s a bit of uncertainty right now, and so everybody is going to have to pivot. November still… gives us time,” he said.
The city council is expected to vote on the move next Thursday.