bexar county is facing a unique fiscal landscape this year, with property values on the decline and the aftermath of the COVID-19 pandemic still lingering. Unlike other municipalities in the region, the county is poised to keep its tax rate steady and avoid significant cuts to services. This stability is largely due to prudent financial management during years of prosperity, which has left the county with substantial reserves.
The county’s ability to weather this economic shift is a testament to its long-range financial planning. By setting aside funds during years of high property values and taking advantage of low-interest rates for projects, Bexar County has positioned itself to handle the current slowdown without resorting to drastic measures.
County’s Financial Strategy and Current Challenges
Bexar County Budget and Finance Director Tanya Gaitan emphasizes that the county’s current financial health is the result of strategic decisions made by county commissioners. “We look at a long-range financial forecast, and right now we’re pretty healthy, so we don’t have a recommendation to increase taxes,” Gaitan stated. This foresight has allowed the county to avoid the tax hikes being considered by other entities like the City of San Antonio.
However, the county is not entirely out of the woods. The pandemic led to a significant increase in the county’s budget, growing from about $1.8 billion in the 2026 fiscal year to nearly $3 billion by fiscal year 2026. This expansion was fueled by roughly $389 million in federal pandemic relief dollars. Now, with property values cooling and federal funds dwindling, the county is at a critical juncture as it finalizes this year’s budget.
Commissioners have been gradually reducing the budget to scale back spending, but they are still facing a situation where expenditures are outpacing revenue. County Manager David Smith warned in April that the county is headed for its worst financial year since the 2008 financial crash. To address this, budget writers are considering measures like a hiring freeze and adjustments to employee health benefits to control short-term spending.
The Impact of Pandemic Relief Funds and Future Planning
The county’s use of American Rescue Plan Act (ARPA) funds has been a double-edged sword. While these funds provided essential support during the pandemic, their expiration is now leaving a void in the county’s budget. Two years ago, the last of the uncommitted ARPA dollars were used to address a deficit, but the situation has since worsened. A previously predicted shortfall of about $28 million by the 2028-2029 fiscal year has been revised to approximately $145 million.
Commissioner Grant Moody (Pct. 3) highlights that the county’s reserves are a key factor in its ability to avoid immediate tax increases. “The simple answer is that we have reserve funds that the other [taxing] entities probably don’t have, which allow us the flexibility to be able to cover any deficit this year, maybe even next year,” Moody said. However, he cautions that tough decisions will eventually need to be made to address the long-term financial outlook.
Supporting Nonprofits and Public Health Initiatives
While the county may avoid major cuts to its own budget, the network of nonprofits and public health initiatives that support vulnerable communities could face significant challenges. Many of these programs were funded through ARPA money and are now at risk of being cut as the funds expire. Bexar county judge Peter Sakai notes that deciding which programs to continue will be one of the court’s biggest challenges this fall.
“Public Health is actually a brand new department that [then-Judge Nelson Wolff] and the previous court created, and we’re having the discussion in regards to what delivery of services we want our Public Health Department to focus on,” Sakai said in a July 1 interview. The county’s Public Health Department, along with initiatives like the SMART mental health crisis response team, has been a critical resource for the community. However, their future is uncertain as the county reviews all ARPA-funded positions.
Nonprofits such as the Children’s Bereavement Center of South TexasSAMMinistries and Haven for Hope have also benefited from ARPA funds. Sakai expressed concern about the impact on these organizations, stating, “I don’t want to balance the budget on the backs of our nonprofits.” However, with the majority of these funds set to expire at the end of the year, the county faces difficult choices about which programs to prioritize.
As Bexar County navigates these fiscal challenges, its ability to maintain essential services and support community organizations will be a testament to its financial planning and commitment to the residents of South Texas.