Kyle gives Anthem an out from EP

By Moses Leos III

An interlocal agreement that requires a swap of extraterritorial jurisdiction (ETJ) between Kyle and Mountain City could vastly change the landscape of the Hays County water wars.

On Tuesday, Kyle City Council voted 7-0 to move forward with negotiations and execution of an agreement allowing the city to acquire the Anthem subdivision, owned by Clark Wilson Homes, from the Mountain City ETJ.

Kyle City Manager Scott Sellers said the agreement was originally brought to the city by Anthem developer Clark Wilson last year.

Within the agreement, Anthem, a proposed Municipal Utility District (MUD), would receive water and wastewater services from the city of Kyle. Currently, Anthem is one of three customers contracted to purchase water from Houston-based Electro Purification (EP). The past few months have seen a contentious cross-county fight about the project.

In turn, Hays County would be required to supply equipment and labor for repaving and improving roads in Mountain City.

According to Sellers, the city looked at extending utilities to Anthem, and found it “feasible” to do so. Mayor Todd Webster said the city’s future water plan could support the annexation of the development.

 “We have the resources. We are strong on the water side to be able to provide that service,” Webster said. “They knew that ahead of time, that’s why they asked us, but we didn’t know how to get there.”

Webster said the city and the developer held informal conversations on the agreement, but was told the city “needed to provide something more formal.”

 Kyle then approached Hays County to assist in drafting a formal agreement. Meanwhile, the county was in the midst of finding alternative water solutions for Anthem, as well as the city of Buda and Goforth Special Utility District, who also have contracts with EP. 

In an emailed response, Hays County Pct. No.2 Commissioner Mark Jones said a meeting was held with stakeholders involved in the EP Well Fields along FM 3237 in Wimberley. Those parties included Hays County Commissioners and Judge Bert Cobb along with representatives from Kyle, Buda, San Marcos and the three EP customers. 

After the meetings, Jones said San Marcos and Kyle were working with Buda to find an alternative water source. Kyle and Mountain City were working on an agreement with Anthem. 

“The elephant in the room here is that this is wrapped up in the Electro Purification and the Trinity Aquifer issue,” Webster said on the dais. “This would provide a more stable water source for development out there.”

 But several challenges lie ahead before any such agreement is signed. Council member David Wilson said on the dais it would be a “challenge” to offer sewer service more so than water.

 For Webster, a MUD 25 years from now is a “giant” liability. However, he said there is a way to make it a “win for Kyle.”

 Webster said the city could make it work, but it could take Public Infrastructure Districts, along with “forward funding infrastructure and expansion of sewer plants.”

“It justifies the expansion of infrastructure we can leverage and do other development out there,” he said. 

But with the agreement as only an offer, the ball is now in Mountain City’s court.

“Unilaterally, Mountain City doesn’t have to do this,” Webster said. “What we do is not binding on Mountain City in any way. Should Mountain City accept the agreement, that’s what would trigger obligations on our part and [the]county’s part.”

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