By Moses Leos III

After nearly a year, the Kyle City Council voted 7-0 Tuesday to rescind an interlocal agreement (ILA) involving Mountain City and Hays County that could have extended utilities to the Anthem subdivision. 

But Anthem developer Clark Wilson is preparing to fund improvements that could still have Kyle transfer water and wastewater service to the 2,200 home development. 

It’s part of a Letter of Intent (LOI) involving Mountain City 150, LP (MC 150) and Kyle. MC 150 comprises Wilson and his development team. 

According to city documents, Kyle would provide Anthem water and wastewater service if MC 150 constructs a potable water distribution system. 

MC 150 would also be responsible for potential upgrades to the city’s wastewater treatment plant to accommodate the development. 

Kyle City Manager Scott Sellers said Anthem would function as out-of-city ratepayers. 

“It is a revenue generating stream to our utility system, which at this point, is a very much needed shot in the arm,” Sellers said. 

In the LOI, MC 150 anticipates service needs for 1,900 homes for the proposed Municipal Utility District (MUD). 

“We’ll do whatever it takes for the growth to pay for itself,” Wilson said to the city council. 

Sellers said the city entered the development into its wastewater calculations. Kyle also took the development into account when calculating its water model.

The LOI, according to Wilson, was a result of the city’s ILA that “appeared to run aground for a lot of different reasons.” 

The ILA involved an extraterritorial jurisdiction (ETJ) transfer between Kyle and Mountain City.

Under the ILA, Mountain City would have relinquished the 673-acre property located in Mountain City’s ETJ to Kyle in return for water and wastewater services. Hays County would have been required to rebuild roads in Mountain City. 

The ILA was developed after Wilson reached out to Kyle for service to avoid partnering with Houston-based water firm Elecro Purification (EP). 

But the ILA was met with stiff resistance from Mountain City officials, who never acted upon Kyle’s agreement.

Kyle continued its quest to attain Anthem in November as part of a complex agreement between Kyle, the Dahlstrom Family Trust, Mountain City and the City of Dripping Springs. 

But Sellers said with the LOI, the city no longer needed jurisdictional contiguity to provide services to Anthem. 

Kyle Mayor Todd Webster said he felt no ill will toward Mountain City for not accepting the ILA. 

“It’s helping us solve a problem, and we needed to cut the cord,” Webster said.