Pushback against another data center project
HUTTO — The City Council has approved a Fiscal Year 2026-27 budget of about $315 million, OK’d a no-new-revenue tax rate and voted to freeze water-bill costs until 2031.
The water rate applies only to residents who receive municipal services, officials said during the Sept. 3 council session “We’ve got really smart people, and I’m confident that we will get to the place where we are not raising water rates anymore. My hopes are we never raise water rates again,” Mayor Mike Snyder said about not hiking rates for another five years.
The council also adopted a no-new-revenue tax rate, or NNR, of nearly 40 cents per $100 valuation, a little higher than the 2025-26 figure of almost 39 cents.
According to city officials, tax revenue from development and new properties in the burgeoning city will add an additional $1.35 million to city coffers.
According to city documents, the median taxable value of a homestead in Hutto is $329,770, dropping more than $20,000 since 2025. The 2026 NNR rate, while slightly higher than last year’s NNR rate, will result in a reduction of about $45 on the median household’s estimated property tax bill.
This may result in an increase in tax for some properties if the appraised value goes up.
This rate will raise more revenue from property taxes than last year by about $960,485.
Snyder said the budget resulted from the efficient use of developer revenue, collaboration with the Hutto Economic Development Corp. and efforts of city staff, the council and the public.
“I think we’re doing the right thing by being conservative with our budgeting. I don’t think most cities are set up as well as we are right now,” Snyder said.
Finance Director Alberta Barrett said the city was able to cut the amount of capital funding needed for wastewater projects from $29.1 million to $12.3 million.
On the other side of the ledger, funding for the proposed Justice Center increased from $42 million to $48 million, which will be a 2027 general obligation debt if approved by voters in November.
Street projects will require $4.6 million in certificates of obligation in 2027.
In addition, the city with a general fund of $37 million also plans on $214 million in capital improvements and $23 million for employees, according to records filed online.
By state law, a budget must be locked into place before the new fiscal year starts Oct. 1.
New gas station sheds light on tax-share issues A 4.172-acre development at the southeast corner of Limmer Loop and CR 132 in Hutto’s extraterritorial jurisdiction gave the council an opportunity to explain how the cost-sharing agreement with Williamson County Emergency Services District No. 3 affects the city.
New developments of 5 acres or less do not qualify under the current sales and use tax sharing agreement the city has with the ESD. Snyder said annexing the gas station and retail plaza will require city services, including police and infrastructure, but the city will not receive a share of the sales tax revenue generated by the businesses.
The proposed use for the site is non-residential, consisting of a single-story convenience store of 5,000 square feet with 12 gas pumps and an 8,000-square-foot retail building.
The council approved a municipal services agreement and an annexation agreement with the developer, Limmer CO 132 Real Estate LLC.
Snyder said most retail development annexed into Hutto is not part of the sharing agreement because it is less than 5 acres.
“This (agreement) is killing us on every fastfood place that comes in, in the future for ever and ever, the build-out of the next 80% of our city,” he said.
Talks between the city, which wants to build its own fire station, and ESD No. 3 continue.
Another data center planned for U.S. 79 corridor
Hutto Planning and Zoning Commission approved an application Sept. 1 to rezone 140 acres from light-industrial development for a potential data center.
The site sits in the east-central portion of the Hutto Megasite, at U.S. 79 and CR 3349 inside the city limits.
Several data centers are planned for eastern Williamson County and almost all have raised concerns about noise, pollution and drains on the grid and water. Gov. Greg Abbott has even directed state regulatory agencies to audit the power demands of proposed centers.
Resident Nette Norman Lessner lives in the Norman’s Crossing neighborhood nearby on FM 1660. Lessner told the Planning and Zoning Commission farmers and families who live in the area are raising concerns.
“We have some questions about this data center. How big is it going to be? What is the noise pollution, light pollution, water use, wastewater, electricity, traffic and construction going to do to all of us and our quality of life?” Lessner asked.
Supporters note data centers are needed for artificial intelligence, communication, banking and military support, among other uses.
The Hutto Economic Development Corp. submitted the application to rezone the site to a planned unit development, or PUD, allowing for data center facilities and potential onsite power generation, along with room for flex-industrial buildings, industrial and warehouse uses.
“The PUD is intended to provide a development that is equal to or superior to what would be achieved under standard zoning regulations, while ensuring it does not create undue adverse impacts on adjacent properties, traffic, parking, utilities, or public health and safety, and is adequately served by essential public facilities and services,” said developer representative Talley Williams in a letter to the Hutto Planning Department.
According to Hayne Strader, chief development officer at Skybox Data Centers, a tenant for the data center has not been identified yet.
The land needs first to be zoned correctly and have received the permits needed for power generation, and then it will be built to suit a tenant. If the developers cannot acquire a power-generator permit, the tract will be repurposed for light-industrial use rather than as a data center.
The item must next be heard by the council before the rezoning can proceed.
