The Aubrey City Council voted 3-2 Tuesday night to approve an agreement to transfer water rights for the Winn Ridge development back to Mustang Special Utility District.
In return for granting Mustang the rights to provide water and wastewater, the city will receive an 8 percent franchise fee, impact fees and an additional $500 per lot, Ross Martin, bond counsel for the city, said at the meeting. The city will also be repaid the costs of the previous transfer of water rights, while also gaining water rights for the Venable Ranch and Aubrey Estates developments from Mustang.
The city also agreed to an additional Public Improvement District, which will finance infrastructure within the Winn Ridge development. The loans are paid back by residents who purchase the homes, but council members disagreed on whether the PID exposed the city and its current taxpayers to additional liability.
“I believe every council member wants what is best for the City of Aubrey,” Aubrey Mayor Janet Meyers said in an email.
City staff recommended against approval of the new deal, and council members Deborah Goin and Oscar Pearson agreed and voted against it.
“I am disappointed we are listening to the developer and not the professional advice we have been given," Meyers said. "By ignoring our professionals, we have saddled our citizens with the liability and the responsibility for debt that benefits Mustang SUD — not once but twice in one night. This deal is kinda like Obamacare. We are going to have to implement it to understand exactly what we have done to ourselves,” Meyers said.
Council member Calvin Tillman said the deal was what was best for the city.
“The reality is now we can plan for the future,” Tillman said. “I think that was something everybody’s missing.
“The biggest advantage is that we know where we’re going to be serving water for sure. It’s close to our borders, we can expand our existing system, and we don’t have to create a completely new system. I think that’s a huge benefit to the city.”
The meeting went late into the night as representatives of the Centurion American Development Group attempted to persuade skeptical council members to approve the deal.
"We don't want to do anything to change our commitment to Aubrey. We want to be a part of your city, and it's important to live by your rules and do right by you," CADG CEO Mehrdad Moayedi said.
Moayedi went on to detail the agreements his company negotiated with Aubrey over the past several years.
Meyers has insisted Aubrey retain the water rights.
"You left out the part where you promised me the water and sewer," Meyers said to Moayedi. "I'm just saying let's tell the whole story."
"The reason the water and sewer changed is totally out of my control," Moayedi said in response. "We've been a supporter of you and Aubrey all along the way."
Winn Ridge, now under construction, is a development of about 1,300 homes about 8 miles southeast of Aubrey proper. CADG had agreed to be annexed into the city limits and removed Mustang as the water provider for the development at Aubrey's request.
Mustang then took on some federal debt it argues prevents the utility district from releasing any more of its service area. Two other developments, Sandbrock and Regatta, then decided to remain under Mustang and not switch to Aubrey's water system.
Winn Ridge's developers then approached the city and council members directly about the proposed change.
Wilson said the changes left Winn Ridge as an "island," a piece of Aubrey's water system completely surrounded by Mustang. Mustang already has a water tower 60 feet from the development it is not willing to share. Keeping the water rights would mean Aubrey would have to build another water tower adjacent to Mustang's tower and serve only 1,300 homes.
Aubrey council member Chris Rich has been heavily involved in the discussions to change the plan and voted for it.
Council members Jeff Perry and Tillman also voted for the change.
Aubrey is currently on 100 percent well water. The new water system would have been the city’s first purchase of reservoir water from the Upper Trinity Regional Water District. Rich said the city would be committed to purchasing a certain amount of water whether or not the city used all of it.
“The biggest part of the deal is it takes away the risk the city has with an Upper Trinity obligation and puts that risk back to Mustang,” Rich said.
In other action Tuesday, the council approved an interlocal agreement with Providence Village for police services and approved a boundary agreement with Providence Village and Little Elm. The Providence Village council unanimously approved both deals, and the Little Elm council also approved the boundary agreement.
DANIEL BURGESS can be reached at 940-566-6875.