San Antonio City Council Evaluates $500M Bond Program Amid Property Value Declines

In the heart of San Antonio's city hall, council members gathered on August 27, 2025, to discuss the city's financial future, focusing on the intricacies of the budget and the implications of recent legislative changes. The atmosphere was charged with anticipation as officials reviewed the city's credit rating and its impact on bond issuance, revealing a promising landscape for investors.

City officials highlighted that San Antonio's strong credit ratings—triple A from Moody's and S&P, and double A plus from Fitch—have attracted significant interest from investors, with 11 new participants eager to engage in the city's bond market. This enthusiasm translated into a successful bond issuance at an impressive interest rate of 3.93%, alongside a refunding opportunity that yielded $3.3 million in gross savings.

As the discussion shifted to property taxes, the council faced the reality of a proposed reduction in the voter approval tax rate from 3.5% to 2.5%, a change that could limit the city's revenue growth without voter consent. Assistant City Manager Jeff Coyle explained that this legislative shift, if enacted, would not affect the current budget but could have significant implications for future fiscal planning.

The council also examined the city's property tax rate, currently set at 54 cents, which has remained unchanged since 2004. This stability contrasts with other Texas cities, where tax rates fluctuate based on capital needs. The council's commitment to maintaining this rate reflects a cautious approach to managing debt and ensuring financial stability.

Looking ahead, officials discussed the potential for adjusting the frequency of bond programs from five years to a shorter timeline, allowing for more responsive financial planning in light of fluctuating property values. The conversation also touched on the possibility of leveraging stormwater revenue bonds to fund drainage projects, a move that could enhance the city's capacity to address critical infrastructure needs.

As the meeting concluded, council members were left with a sense of urgency to navigate the complexities of the budget while ensuring that San Antonio remains a vibrant and financially sound city. The decisions made in this session will undoubtedly shape the city's fiscal landscape for years to come, as officials strive to balance growth, infrastructure needs, and the expectations of their constituents.