Fair Oaks Ranch council approves first reading of annexation, leaves Post Oak PID hearing open

The Fair Oaks Ranch City Council on June 19 approved a services agreement and carried out the first reading of an ordinance to annex a roughly 344–345 acre tract on Ammon Road for a proposed subdivision called Post Oak, while leaving a related public improvement district (PID) public hearing open until the council’s July 3 meeting.

The services agreement — required under state annexation rules — and the first-reading annexation ordinance apply to a parcel the city and staff said would be developed as Post Oak with about 278 single-family lots. City staff identified the petitioner as Boerne Ranch LLC and said the annexation petition and required public notices were completed in accordance with Texas Local Government Code requirements.

The annexation matter drew public comment and council questions about water supply. R.W. Simpson, a Fair Oaks Ranch resident, urged the council to halt the development because of the ongoing regional drought and said many nearby wells are going dry. “Water is not an infinite resource,” Simpson said during public testimony and asked the city to prioritize existing residents’ water access before allowing new development.

City staff and council responded that the proposal reduces previously reserved water allotments: staff said the city’s Local Utility Entitlements (LUEs) reserve was previously sized for roughly 600 LUEs and that this annexation/development agreement reduces that reserve by the equivalent of 278 LUEs, leaving staff confident the city can provide water under its current annual water allocation. Staff also said notices and other statutory steps required for voluntary annexation were completed, including posting, publication and mailings required under state law.

On the PID, Assistant City Manager Jim Williams and supporting consultants described the proposed Post Oak PID as part of the broader development plan. Williams said the PID is a financing mechanism under state law to pay for public infrastructure and explained different PID structures (reimbursement vs. construction bond PIDs). He cautioned the council that PIDs create nonrecourse debt secured by assessments on the developed property and that certain PID debt counts toward the city’s bank-qualified debt limit; the development agreement would require the developer to pay city costs associated with administering the PID.

Williams advised keeping the PID public hearing open and reconvening it at the July 3 meeting so staff can finalize draft findings required under state code (including advisability, estimated costs, assessment method and proposed apportionment of costs). Council voted to adjourn the PID hearing and reconvene it on July 3.

Formal actions taken and procedural next steps: the council approved a resolution authorizing the city manager to execute a municipal services agreement for the annexed area and approved the first reading of the annexation ordinance; the services agreement will be attached to the final ordinance if council approves final reading. The PID public hearing was not closed; the council voted to adjourn and reconvene the PID hearing on July 3 to allow staff time to refine findings and required documents.

Why it matters: The annexation and potential PID would add several hundred homes inside city limits and create a financing mechanism that places infrastructure costs on new development through assessments rather than general-tax revenues. Residents’ concerns about water availability and traffic routed through existing neighborhoods were central to public comment and will factor into council consideration before final approvals.

What’s next: The council will consider final readings of the annexation ordinance and the services agreement at future meetings (staff indicated the services agreement will be executed prior to second reading). The PID record will remain open until the July 3 meeting, when council will consider draft findings and any additional public input.