Taylor, Texas Had No Legal Say Over a 664-Acre Data Center Next Door. On October 8th, It Annexed Its Way Into Getting Some.

The 664 acres between FM 112 and US 79, just outside Taylor, Texas, sat in unincorporated Williamson County. That one fact meant the city had no zoning authority over what got built there, no noise ordinance that applied, no say over how much water a cooling system could pull. Big Watt Digital and PowerHouse Data Centers didn't need Taylor's permission for any of it. On October 8th, the city council voted 5-0 to fix that the only way it could: by annexing the land.

Annexation is usually a quiet tool cities use to grow their tax base and extend water and sewer lines. Here it did something sharper. Pulling the site inside city limits was the only way Taylor could write enforceable rules for a project it couldn't otherwise touch — so the council traded annexation for a list of conditions, and got a vote on its own terms instead of watching the campus get built next door with none.

What the city got for its signature

The project, formerly called Project Mustang and now branded the Taylor Technology Campus, is planned for roughly 500 megawatts of data center load plus behind-the-meter, on-site power generation — with room for another 500 megawatts if a second, still-unidentified tenant signs on, according to the Austin Business Journal. Under the annexation agreement, the campus has to run a closed-loop cooling system on nonpotable water rather than drawing from Taylor's drinking-water supply. Big Watt Digital and PowerHouse separately withdrew their application for a TCEQ wastewater discharge permit and committed instead to investing directly in upgrades to the city's own wastewater system. Developers pledged $28.2 million in direct community commitments, and a developer-commissioned study projects $1.38 billion in gross tax revenue for Taylor over the next 20 years — a number worth remembering came from the project's own consultants, not an independent audit.

Mayor Jim Buzan called the terms "the best path forward for Taylor and the surrounding area," and tied the specific conditions — water, noise, setbacks — directly to what residents had been raising at council meetings for months. Taylor ISD Superintendent Jennifer Garcia-Edwardsen backed the deal too, framing her support around a single test: will it benefit our students. That's the case for the deal in a sentence — a city with zero leverage used the one tool it had to get some, and walked away with real, written conditions plus a tax base it wouldn't otherwise collect a dime from.

The petition the city says doesn't count

It wasn't uncontested. The HALT Taylor Data Centers coalition spent weeks gathering roughly 1,400 signatures on a petition that would have barred new data centers under the city's current zoning until Taylor wrote rules built specifically for digital infrastructure. The city's charter says a petition carrying signatures from at least 10% of registered voters forces the council to either adopt it within 30 days or send it to voters at the next election. Taylor's position is that none of that applies here: state law, the city says, doesn't let zoning changes happen by petition or popular vote at all, full stop. The coalition disagrees and has filed a writ of mandamus in a Texas appeals court trying to force the question onto the November 3rd ballot anyway. That fight is still open.

Resident Scott Gibbs put his objection on the process, not just the project, criticizing city staff and council members for negotiating the annexation terms behind closed doors with little public input before the vote. Another resident was blunter about the stakes at the council meeting, warning that the project would "suck up our water, take our energy, and raise our prices." The council heard both and voted 5-0 anyway, which tells you where its read of the tradeoff landed — not that the objections were wrong, but that annexation's conditions beat the alternative of no conditions at all.

An on-site power plant nobody's named yet

One detail in this deal still has no public answer: what, exactly, is generating that behind-the-meter power. Axios and KUT both describe the campus as including its own power plant alongside the data center buildings, and neither has reported a fuel type or a firm capacity. That's not a small gap. Texas is mid-freeze right now — Gov. Abbott's August and September orders paused new data-center permitting statewide while ERCOT and the PUCT audit how much of the state's roughly 410-gigawatt interconnection queue is real demand versus developers holding a place in line — and a project that builds its own generation rather than queuing for grid power is, by design, a project that sidesteps most of what that audit is trying to measure. We've seen this pattern before, in New Mexico and Pennsylvania both: when a developer skips the interconnection queue entirely, the usual evidence of a site's power plan — a utility's written load study, a signed interconnection agreement — simply doesn't exist to check. Until Big Watt Digital and PowerHouse say what's actually running on that site, this detail sits at the bottom of our evidence ladder, not because anyone's lying about it, but because nobody's said anything to verify.

I think the annexation story is the one worth watching past Taylor's city limits. The PUCT's new interconnection deposit already covered here raised the cost of getting into ERCOT's queue; Taylor just showed that a city with no zoning leverage at all can still claw some back, if it's willing to annex rather than just object. Every other unincorporated Texas county with a data center proposal sitting just outside its nearest city's limits is watching the same math Taylor just ran. The petition fight isn't over, and it shouldn't be read as settled just because the council voted — but the lesson for the next town facing this same gap in its own authority is already written down, in the form of a signed agreement, not a rejected one.