State of Persimmon development uncertain in Buda

BUDA — Despite the span of several meetings discussing the potential project, the state of the Persimmon development in Buda is currently paused.

During the Feb. 6 meeting, the Buda City Council approved the first of two readings of a development agreement (DA) with MileStone Community Builders, with edits for building the proposed Persimmon project located off RM 967. The approximately 750-acre project sits partially between the city of Austin’s extraterritorial jurisdiction (ETJ) and the portion of Buda’s ETJ, from which the Persimmon project was removed. The primarily residential project, situated at RM 967 on the Armbruster and Bailey land tracts, will contain a small mix of commercial space.

Buda City Manager Micah Grau explained that there are some concerns that council has regarding the DA as it is currently written, including that it contemplates a 75% rebate on property taxes through a Tax Increment Reinvestment Zone (TIRZ). Because of this, the city council wants to wait to see if Hays County is willing to participate in the TIRZ, which would reduce the percentage the city would participate at, he explained.

“The second one is there's language that was added by MileStone. Basically, the understanding of how the development agreement was being put together, there's a lot of different moving pieces. MileStone has to request release from Austin’s ETJ, for the portion that is in the ETJ,” the city manager said. “They have to request release from Austin’s certificate of convenience and necessity (CCN) for utility services area certificates because there's a small portion that is in Austin's water and wastewater service area. All of that wouldn't be initiated until after the development agreement was approved.”

Throughout negotiations, the city of Buda has maintained that all parts of the DA should apply and that both parties reserve the right to walk away from the agreement up until the point that the city would issue Public Improvement District (PID) bonds to finance public improvements, according to Grau. And in response to this, MileStone inserted language that would require the city to provide the Persimmon Development with utilities if the city walked away from the agreement, with MileStone not being required to meet any of the other DA requirements related to land development and infrastructure.

“The intent was, up until that point, either party would have the ability to back out of the agreement and go back to basically status quo with MileStone being outside of the city’s ETJ and then the city having no obligation to serve the project,” Grau said. “The city's position has been that we will do everything. We will serve the utilities and the developer will build all the infrastructure that's included in the DA, or nobody will do anything. It’s like an all or nothing type of scenario. But there's some language that was added pretty late in the negotiations by MileStone that would have required the city to still provide MileStone with water and wastewater services, even if either party backed out … We'd have that requirement to serve them, but not get the benefit of all the other things in the DA so that's what we have pause in the negotiations is that language.”

While residents may believe that the Persimmon Development is approved and finalized, Grau explained that it is still pending because there needs to be a second reading before it’s approved.

MileStone has indicated to the city of Buda that the company is working on some alternative language to the DA, but the city has not received it. Also, the city has submitted the information to Hays County to see if it will participate in the TIRZ.

For more information on the background of the Persimmon project, visit bit.ly/3TnPmDX.