HUTTO – ‘Slow and steady wins the race,’ seemed to be a successful philosophy for the city as council members gave their approval to a new development agreement with Limmer Holdings, LLC, on Thursday.
In 2023, the developer petitioned to be released from Hutto’s extraterritorial jurisdiction and planned to build its own wastewater treatment plant. Now, the land is being annexed into the city and will be served by Hutto city wastewater.
“I’m real supportive of this project. It may cause traffic issues, maybe a lot of things, but if we’re not going to support this you guys have the ability to get the water from (Jonah Water Special Utility District). You could have stayed out in the county,” Mayor Mike Snyder told the developer’s representative during the meeting. “We would have had all the impacts we were going to have, regardless. It’s just now there’s control a little bit over the development. Working together, it’s more of a collaborative effort.”
The 111-acre project called Limmer Square (formerly Pearl Estates) sits in the Hutto ETJ at the southwest corner of U.S. Highway 79 and State Highway 130. The mixed-use neighborhood will have 205 single-family houses, 220 town homes, 300 multi-family units and 60,000 square feet of commercial property.
Estimated value of the single-family homes is $414,835.
The project has a projected total value of $249,270,902 when complete, which at Hutto’s current tax rate of 39.96 cents per hundred dollars of value would mean $995,969 in annual tax revenue to the city. The developers will also pay the city a community benefit fee of $2,715,000.
But one of the biggest benefits may be the elimination of a private wastewater treatment plant. The city actively looks for ways to circumvent the construction of “package plants”, or neighborhood sewer treatment plants in its ETJ.
There was a plan in place for the city to eventually extend wastewater service to the Limmer Square area, but as of early last year it had not been funded. The cost of building its own line to connect to the city sewer was significantly more expensive for Limmer Holdings than building its own sewer plant would have been.
In May 2024, city staff announced they had been working with the developer to find a solution, and Limmer Holdings agreed to pay a share of the infrastructure needed to bring the city’s wastewater service into the area instead of building its own facility.
Limmer Holdings’ cost for the public infrastructure will be significant, and the developer wants to create a Public Improvement District to fund it. The PID would allow the city to issue special assessment bonds to raise revenue and the bonds would be paid back through an assessment put on the homes and businesses in the development.
The bonds would raise $27,155,000 in funding, with about 20,772,871 available for the project after fees and holdbacks. The developer is contributing another 11,260,255, adding up to 32,033,126 available for the infrastructure. The bonds are expected to have a 5.75 interest rate over 30 years.
Hutto’s financial advisor, Jim Sabots of Hilltop Securities, said after evaluating the proposal that his team approved it and considered it a “creditworthy” investment for the city.
Everyone who buys a home or commercial lot in the development will pay an additional fee, or tax-equivalent, of 84 cents per $100 valuation, and will have a lien added to their property to help pay off the infrastructure bond funding. For single-family houses, that .84 would be $3,481 annually in addition to city tax and other taxing entities. Over the 30 years it will take to pay off the bonds, that adds up to an extra $104,430 paid per house, according to city documents.
“We just heard that this development, if approved and if the PID is approved, would have approximately a 3X equivalent tax rate above what a regular citizen of Hutto would pay. Is that accurate?” Mayor Pro Tem Peter Gordon asked the developer, pointedly referring to proponents of “no new revenue” tax rates. “Are we confident we’re going to be selling homes in this development? You guys sound pretty confident you can build and sell homes at that rate. I just wanted to make sure because I keep hearing on social media that 39 cents is killing everyone.”
With Thursday’s unanimous vote, the project now requires a public hearing before City Council can officially approve the development’s annexation into the city and the creation of the Limmer Square PID. The hearing is scheduled for May 15 at City Hall, 500 W. Live Oak St.
