An economic development tool created by the state four decades ago is a commonly used way to concentrate funding for improvements in one area of town, and encourage future investment in the neighborhood.
But exactly how a Tax Increment Reinvestment Zone (TIRZ) works is commonly misunderstood.
“They’re just so obscure, and it’s not something that most people are even aware they exist,” said Heather Way, clinical professor of law at the University of Texas at Austin School of Law.
“Yet they’re not really obscure because they’re overseeing millions of dollars of tax revenue.”
Some say the tool also has flaws with long-range effects: taking tax dollars from property development meant for all and trapping it in one geographic area of the city — often for a period of time far past what was intended to boost the area and without much transparency.
“The wealthier an area, the more tax revenue that it is able to generate through a TIRZ,” Way said. “That money is being captured within the TIRZ and is not going to fund other parts of the city that don’t have the ability to generate that kind of tax revenue.”
City of San Antonio TIRZ map. Credit: Courtesy / City of San Antonio
Others say it’s a much-needed system of building up public infrastructure and encouraging private development without dipping into the existing tax base.
In the 2025 fiscal year, roughly $45 million, or about 5% of the City of San Antonio’s $819 million in levied property tax dollars, were captured in both city-initiated and developer-initiated TIRZes, said the city’s Chief Financial Officer Troy Elliott last fall.
Now, as San Antonio faces a $158 million budget shortfall for the coming fiscal year, the mayor and council are considering every stopgap measure, from defunding other programs to raising taxes — and renewing conversation about how best to use the economic development tool.
Way said she’s always surprised at what little attention gets paid to TIRZes, “given the level of public tax dollars that they are overseeing and the embedded conflicts of interest that can exist.”
She co-wrote an “advocate’s toolbox” to help the public take ownership of how their cities spend tax increment financing. It shows community members how the systems work, how to evaluate written public-private funding agreements and make the case for changes.
Westside and Houston Street
For the city-initiated TIRZ that encompasses the near West Side, boundary changes and recent removal of parcels of land did not go unnoticed by community advocates, plus at least one developer group and the district’s representative on City Council.
In 2024, the plan to move minor league baseball into the urban core was hailed as a win for the city, revitalizing Downtown West and bringing vibrancy to the center city at a cost the city could afford.
An expert in sports venue financing said at the time the complex arrangement was cutting-edge, combining a big commitment from the team with property tax dollars from new development to fund a $160 million new sports venue and keep the Missions in San Antonio.
Now two years later, even as the project is delayed by a year, Westside advocates are still asking questions about the deal — and attempting to regroup in a kind of tug-of-war to keep taxable property working for the historically underserved community.
A mural art work for the Downtown West district is displayed on the side of Weston Urban’s vacant Milam building in downtown San Antonio on May 11, 2026. Credit: Amber Esparza / San Antonio Report
At issue are 17 parcels of land that were once located within the boundaries of the Westside TIRZ and earmarked for the venue and new housing. Today, that property sits in the ever-expanding Houston Street TIRZ, where it could generate funding for the ballpark — but not necessarily the needs of the West Side.
The TIRZ basics
TIRZ funds come from any new value, or growth, created within the zone when new development occurs. The tax increment base is the starting property value of all taxable property within the TIRZ when created.
That base value continues to generate property taxes for the taxing entities, like the city, just as it did before the TIRZ existed, so those tax revenues are not available to the TIRZ.
The Texas Tax Code states that TIRZ funds are intended for three purposes:
- Building public infrastructure that draws businesses;
- Boosting development, which grows property values and long-term tax collections, and
- Reducing the cost of private development by reimbursing qualified public improvements
Board members of a TIRZ enter into an agreement with a private developer for projects within the zone. The developer pays the cost of construction, then gets reimbursed through the TIRZ.
The improvements ostensibly increase the appraisal value of property in the zone, boosting the value of tax increments and amplifying the developer’s investment.
They’re also controversial in some ways. A 2018 report by the Lincoln Institute of Land Policy suggests steps could be taken to foster transparency and improve how TIRZes work.
In Wisconsin and Illinois, for example, state agencies track and report on total property tax revenues going to the districts and local governments are required to report detailed information related to revenues and their tax base. Nearly everything is published in online databases and that’s not always the case in other cities.
9 San Antonio TIRZes
In 2009, the city created the Westside TIRZ, where new tax dollars could stay in the zone to help fund new projects.
The recently restored Basila Frocks, a historic but formerly dilapidated structure now serving as a small-business business incubator thanks in part to TIRZ funding, is one example.
Basila Frocks sits on the corner of North Zarzamora and Martin reopened this winter in the Gardendale neighborhood on the West Side. Credit: Amber Esparza / San Antonio Report
There are nine such designated geographic areas within the city where growth in property tax value is redirected from citywide coffers for improvements within the zone. Five of the zones are in the downtown area, including the Midtown TIRZ.
In 2022, the Midtown TIRZ approved funding agreements for both the San Antonio Zoo’s new gorilla exhibit and the Witte Museum; both are just outside the Midtown TIRZ boundary.
State law mandates many aspects of how a TIRZ works.
But some of those rules have been interpreted broadly and the districts have been extended for decades past the original end date — to the point that some cities are taking a step back, Way said.
“TIRZes were originally set up like a funding tool for infrastructure for development that wouldn’t happen but for the TIRZ,” she said.
“But what’s happened is that TIRZes have, even after that original development happens, continued to live on … so then they end up just being these local authorities that have the spending powers that are using money that otherwise should be going to the general fund [as] general revenue for the council at large, and for the public at large.”
The City of San Antonio’s tax increment financing policy is a guiding document for city-initiated TIRZes first adopted in 1998 and lists nine policy areas that TIRZ revenue could benefit.
At the top of the list is housing and affordable housing. The policy document states:
“The TIF [tax increment financing] policy will work to encourage investment in designated reinvestment zones but minimize or prevent displacement of people or adverse impacts related to history, culture and quality of life of unique and historical neighborhoods.”
Because a TIRZ is intended to be a short-term economic booster, it also states the typical zone should expire at the end of 20 years, though some have been extended far past that.
The decision-makers
Statutory law also calls for a TIRZ board to consist of at least five but no more than 15 board members, and gives the board the fairly broad power over administering and managing the TIRZ funds.
The board of the Westside TIRZ is made up of seven members: Councilwoman Teri Castillo (D5), Robert Moreno, nonprofit director Jaillin Odalys Diaz Lopez, former Public Works assistant director Nefi Garza, nonprofit housing leader Melissa Loseff, Centro’s Andi Rodriguez and Councilwoman Sukh Kaur (D1).
Kaur also serves on the Houston Street TIRZ board with Elliott, Assistant City David McCary, Director of Center City Development and Operations John Jacks, the county’s Government Relations Manager Manuel Leal, and County Commissioners Tommy Calvert (Pct. 4) and Justin Rodriguez (Pct. 2).
The Houston Street TIRZ board has not met this year so far, nor did it meet last year, but previously gathered twice the year before, according to posted agendas.
It was at a Westside TIRZ meeting on Nov. 26, 2024, that its board received a briefing from Houston, then an assistant city manager, about the proposed parcel swap for the ballpark agreement.
No action was taken or required during the meeting, Chasnoff said. But Castillo said the board expressed its “opposition, dissent and disappointment … because these parcels that were being removed are expected to yield enough revenue to bond the stadium.”
D5 Councilwoman Teri Castillo speaks during a Planning and Community Development Committee meeting in April. Credit: Amber Esparza / San Antonio Report
The Report obtained through an open records request, the minutes, or summary, of that TIRZ board meeting. The Texas Open Meetings Act requires agendas for public meetings to be posted, but not minutes or recordings, the city spokesman said.
During the meeting, Castillo said she was grateful that city leadership was in talks with San Antonio ISD about the financing agreement. But she added she was not in support of removing the parcels that would “reduce the already scarce affordable housing for the furtherance of the stadium.”
TIRZ meeting minutes can be requested in writing, after board approval; but the city is working toward posting them in the future, Chasnoff said.
New ballpark deal
The Missions stadium agreement calls for about 86% of the cost to be supported by the team’s contribution, ticket fees and team revenue, as well as guaranteed city and county property tax increment dollars generated by the new development nestled in the northwest corner of downtown.
The Designated Bidders partnership has committed $39 million to build the stadium.
The price tag also would be covered by a guaranteed municipal management assessment from two of four planned new developments in the area — $1 billion worth of multifamily housing and hospitality projects by developer Weston Urban that are projected to raise property values.
Fourteen percent of the stadium cost will come from the Houston Street TIRZ and two later phases of private development in the area and revenue bonds backed with a pledge from the TIRZ.
Designated Bidders and the city are continuing to work on the financing plan, which will determine the revenue pledge required by the TIRZ and other sources, City Spokesman Brian Chasnoff said in an email. The Local Government Corporation will issue the bonds, and council must approve the release.
The actual stadium footprint sits within the existing Houston Street TIRZ, but the tracts of land slated for development were situated within the Westside TIRZ. Those parcels are expected to generate the revenue needed to repay the bonds issued for the stadium project.
The West Salinas public parking lot along Cameron and Martin streets is near the area designated for the planned Missions baseball development in downtown San Antonio. Credit: Amber Esparza / San Antonio Report
In addition, moving the parcels to the Houston Street TIRZ is necessary because structuring the bond deal in a single TIRZ is more efficient and will be viewed positively from a bond credit perspective, Chasnoff said.
But not everyone sees it the same way.
‘Extremely concerning’
Castillo said she and her district staff has been talking with other council members about the issue, and a council consideration request could come from those talks — if she can get enough support.
“Folks do agree that we do need to invest in the West Side, but how we do it is the debate and discussion,” Castillo said.
She said she hasn’t yet met to discuss it with Mayor Gina Ortiz Jones.
But the mayor has previously suggested the money tied up in TIRZes should be considered alongside other funding sources when trying to address San Antonio’s projected budget deficit.
On Dec. 19, 2024, the City Council approved the amended TIRZ boundaries with Castillo and Councilman Jalen McKee-Rodriguez (D2) dissenting.
Castillo, for example, said at the time of the vote that “divesting from the West Side that has been historically divested from is extremely concerning.”
She voted no, she said, because the TIRZ structure “siphons off public dollars from our city’s general funds” that could be used to address needs like sidewalks, drainage and affordable housing.
“When we ground ourselves in the literature of economic development, displacement and redlining, we see how oftentimes practices like this get fashioned under the guise of a project we’re told we should be excited about, [like] baseball, all while divesting and diverting funds from communities that need it most,” she said.
Castillo is in fact supportive of TIRZ measures when they address community needs, as the tool is meant to do.
A Westside residence in the Monticello Park neighborhood near Thomas Jefferson High School on Feb. 12, 2026. Credit: Amber Esparza / San Antonio Report
She pointed to the Eastside’s Inner City TIRZ, which she sees as “investing in underserved communities, ensuring that we’re meeting the needs and providing affordable housing, accessible community spaces, investing in our public infrastructure.”
Funding and boundaries
The Westside TIRZ is one of the least-funded zones in the city and has a tax increment base of almost $391 million, as reported to the state in January 2025.
By contrast, the Midtown TIRZ reported more than $533 million in tax increment base for the same year, and the Houston Street TIRZ reported nearly $800 million in 2023, the last time it was filed.
The Westside TIRZ board’s most recently approved funding agreements include the city’s economic development department and the nonprofit Prosper West, and the YWCA San Antonio Women’s Live and Learn Center.
Houston Street TIRZ agreements in recent years have supported the redevelopment of the Alameda Theater, public art projects and activities in Travis Park, and a project to bring more shade to downtown.
The Westside TIRZ boundaries encompass parcels of land along both sides of Interstate 35, north of Interstate 10 in downtown San Antonio, and mostly within Council District 5.
Until the council vote in late 2024, the zone also included property in the northwestern quadrant of downtown where the investor group that owns the Missions team has chosen to build the new ballpark.
Those 17 parcels have since been reassigned to the Houston Street TIRZ as part of the ballpark financing deal, bringing that zone its second major boundary expansion since it was created in 2000.
The swapped land includes property occupied by the Soap Factory apartments slated for full demolition and also property eyed for private development planned by Weston Urban.
Gates surround the old leasing office and apartments lot on the 500 block of North Santa Rosa and West Martin streets as demolition is underway for phase one of the Missions ballpark project on March 18, 2026. Credit: Amber Esparza / San Antonio Report
Longtime Westside advocate Graciela Sanchez spoke against the swap during the citizens comments portion of the Dec. 2024 council meeting.
“Sadly, the Westside TIRZ will lose out on these millions of dollars that can and should be used for our community and not line the pockets of an already well-funded TIRZ and private developers,” Sanchez said. “These are public dollars.”
In exchange for the Westside parcels, the city approved increasing its TIRZ tax participation rate from 90% to 100%, the same rate in place for years already by all other city-initiated zones.
It’s not the first time the city has amended Westside TIRZ boundaries.
In 2009, almost 38 acres of residential property were eliminated from the zone while another 48 acres of commercial property were added.
Then in 2015, more than two dozen Westside TIRZ parcels located mostly along San Pedro Creek were removed to expand the boundary size of the Houston Street TIRZ.
In December 2024, City Manager Erik Walsh said the parcel swap was projected to reduce incremental revenue for the TIRZ by over $123,000 a year.
However, extending the term from 2032 to 2060, and raising the city participation to 100%, instead is estimated to raise revenue for the TIRZ by $235,000, and bring the projected TIRZ tax increment revenue to over $266 million during that period.
‘Money flowing’
Extending the term of the Westside TIRZ is a growing trend, Way said, and while it might keep the money flowing in a district, it also creates inequities for the city at large.
In this case, Houston told the Westside TIRZ board that extending the term to 2060 would allow for funding of several projects in the pipeline, including the Las Palmas public improvement project, the Rich Book building acquisition by the San Antonio Housing Trust, the Madonna Center senior center and other projects.
Meanwhile, those who work to reverse the Westside’s historic decline due to disinvestment want to at least keep what they have by way of the TIRZ.
“The removal of 17 parcels from the Westside TIRZ to fund the proposed Missions baseball stadium has raised important questions about long-term investment and reinvestment priorities for the Westside,” said Ryan Kuhl, CEO of Prosper West, which supports efforts to improve the quality of life in the 78207 ZIP code.
“We believe this warrants careful council consideration to ensure the Westside TIRZ serves the community it was originally intended to benefit,” he added.