Lajitas Golf Resort brings forth ballot initiative to finalize utility district establishment

The Lajitas Utility District will have the power to levy an ad valorem tax, issue bonds, assess property, and hold limited powers of eminent domain

A map of Precinct 7 in Brewster County, which will vote on the creation of a Lajitas Utility District. Courtesy of the Brewster County Elections Administrator.

LAJITAS — The creation of a “Lajitas Utility District,” originally established by an act of the legislature in 2011, is now up for a public vote on November 7 in Brewster County’s Precinct 7, a sparsely populated area consisting of parts of Terlingua located South of FM170 and the Lajitas Golf Resort, the entity behind the initiative.

Voters will decide whether or not to confirm the utility district, which has remained dormant since its creation but is now seeking to become active, according to attorney Ronald J. Freeman, the district’s legal counsel.

The district consists of 3,000 undeveloped acres located within the 27,000 acre Lajitas Golf Resort and Spa, according to Freeman, who said there are currently “no specific plans for future facilities or services,” but the district would have the power to create separate districts for such development.

The remote getaway, owned by Texas billionaire Kelcy Warren, is located on the border between Big Bend National Park and Big Bend Ranch State Park and, in many ways, already operates as its own city. It owns and operates an existing municipal water and sewer system, for which it holds a Texas Commission on Environmental Quality (TCEQ) wastewater permit, and has recently provided water to Terlingua in the wake of its outages.

Lajitas Golf Resort and Spa consists of a 112-room resort, a golf course, RV park, multiple restaurants, general store, international airport and includes real estate offerings, in the form of lakeside cottages, for sale. Lajitas is an unincorporated community, and the resort employs around 200 individuals, some of whom live in subsidized housing on site.

The resort was purchased in 2007 by Warren, chairman of the board for Energy Transfer, the company behind the controversial Big Bend pipeline, which transfers natural gas from Fort Stockton to Mexico.

In addition to voting on the creation of the Lajitas Utility District, voters will select any number of five potential “permanent” directors. The initial 2011 legislation designated a temporary board, and all but one of those same directors remain on the 2023 ballot — George Kutch, Renee Lorenz, Brent Ratliff and H.C. Ross Jr., with Morgan Jones replacing John Nolan.

A number of the directors work for Energy Transfer. The district’s legal counsel declined to comment on whether Energy Transfer is involved.

Managing director of the resort Scott Beasley said the delay in finalizing the district’s establishment was due to one of the board members passing away and needing to be replaced.

While the ballot language implies that the directors are “permanent,” Freeman said they technically serve four-year staggered terms and are subject to district-wide election every four years.

If approved, the utility district will have broad powers to “implement water, sewer, and other utilities, construct road and drainage improvements, create public service projects,” and promote economic development, said Freeman. Airport construction, improvement and operations are also among potential projects allowed by the legislation.

The district may “construct or acquire electric power generating, transmission, and distribution facilities and improvements in aid of these facilities,” according to enabling legislation. It may not, however, “provide retail electric utility,” to customers inside or outside of the district, but can sell energy wholesale. Utility districts also have the ability to enter into contracts, allowing their operations to be run by other companies.

The Lajitas Utility District will have the power to levy an ad valorem tax, issue bonds, assess property, and hold limited powers of eminent domain — which do not apply to land outside of the district or for the creation of roads or recreational facilities.

On paper, the district will be a “governmental entity and political subdivision of the state,” according to Freeman, meaning it will be required to post meeting agendas and hold board meetings publicly. But because the proposed district is 3,000 acres of undeveloped land, it is unclear how many, if any area citizens, will be privy to the district’s goings-on.

“If you are not a resident or landowner in the district, you are not subject to the actions of the board,” said Freeman.

Special use districts have been criticized for their lack of oversight — it is not uncommon for district officials to be handpicked by developers. Opponents argue they have the privilege of governmental powers, yet lack transparency.

In the tri-county area, the only other “districts” are underground water conservation districts, which exist in each county, in addition to a new Presidio County Water Improvement District.
The Brewster County Groundwater Conservation District — which the Lajitas Utility District would still be subject to regarding regulations — was not initially aware of the election item.

Brewster County Judge Greg Henington was unclear on the specifics of the initiative, like whether the district intends to levy taxes, but said going public, specifically with the resort’s existing water and wastewater facilities, will open up additional revenue streams.

“I think it gives them some eligibility for funding to improve their water system,” said Henington. “When it becomes a public utility, then they could probably issue bonds or get funding from sources they couldn’t otherwise.”

With only 180 registered voters in Precinct 7 –– and only around 70 living in Lajitas –– it is unlikely the Lajitas Utility District election will see a substantial turn out. If the election is not successful, the current Lajitas Utility District board can decide to hold another election or dissolve, according to Freeman.

According to the TCEQ, there are currently 1,997 active municipal utility districts (MUDS) in the state. James Bradbury, an Austin-based lawyer specializing in water law and conservation, said they are a commonplace tool, particularly for developers, with many being created each legislative session.

“It is not literally as expansive of powers as a city, but it’s a quasi governmental entity that’s created to conduct work and projects,” said Bradbury.

The districts have gained popularity in the state over the past 20 years, said Bradbury, and are commonplace these days for large-scale projects developments, in part because they allow for the cost of creating homes, for example, to be passed on to those buying property.

MUDs have caused issues in other parts of the state when levied for unintended purposes. According to reporting from The San Antonio Express News, a Dallas millionaire leveraged the power of his district to help a friend avoid the installation of a city wastewater pipeline in Dripping Springs and a group of Travis County developers misused its district by providing tax breaks to other developers, negatively impacting taxpayers in other communities.

Bradbury said developers may opt to phase projects, creating additional MUDS as needed for financial reasons, but expanding or creating an additional Utilities District requires legislative action.

“If they want to replicate these powers in a new phase of development, they’re gonna have to go get another MUD, or they could seek legislation to amend the boundaries of this current MUD,” said Bradbury. “Either way this MUD is only going to have powers to the boundaries that were created at the time.”

Brewster County Precinct 7 voters can participate in Early Voting for the Lajitas Utility District election at the Judge Val Clark Beard Conference Room, 203 N 7th Street, Alpine, from October 23 to October 27, and October 30 to November 1, from 8 a.m. to 6 p.m. Early voting will also be open Thursday, November 2, and Friday, November 3, from 7 a.m. to 7 p.m.

Election day voting will take place from 7 a.m. to 7 p.m. at the Red Pattillo Community Center for Precincts 5, 6 and 7.

To view the Lajitas Utility District election order visit, brewstercountytx.com/wp-content/uploads/2023/10/NoticeOfElectionToTheResident-QualifiedElectorsofLajitasUtilityDistrictNo.1.pdf