Killeen council declines proposed wholesale water deal after hours‑long debate

KILLEEN — The Killeen City Council voted unanimously on April 15 to deny a proposed 10‑year wholesale water agreement with Texas Water Utilities that would have allowed delivery of up to 1.5 million gallons per day to a developer and included a $1 million connection fee and a $10,000‑per‑month phase‑in guarantee.

Assistant City staff presented the deal as an opportunity to monetize excess reserved water and generate revenue for the utility fund. “This is significant revenue for almost no effort from the city,” the presenting staff member said, describing the contract’s structure and the city’s retained treatment‑cost obligations.

But several council members questioned whether the short‑term financial return justified the long‑term implications. “My only concern is… you start on a development, and it's a flashback to me like the ETJ,” the mayor said, arguing the city should avoid committing scarce water to outside developments that may later create emergency political pressure to break a contract. “I would never do that to another council coming,” the mayor added.

Council Member Cagle, who led the presentation, argued the city would be selling only water it currently does not use and that the revenue could be reinvested in system maintenance. “Why would we pay for additional excess capacity when we already have excess capacity?” Cagle said, urging that the modest near‑term revenue could be used to reduce wasteful daily flushing and fund repairs.

Other council members raised concerns about future scarcity, the perceived long‑term nature of the 10‑year term, and whether $1 million was sufficient compensation for foreclosing water options. “It’s not a 10‑year contract — it’s kind of forever,” one council member said, noting uncertainty about future councils and environmental conditions.

Public commenters reflected the split on the issue: developers and representatives for the prospective wholesaler urged support, saying the city’s excess water could support regional growth; residents and civic speakers warned against selling water during uncertain hydrologic conditions and urged caution.

After deliberation the council voted to deny the RS‑25‑059 item, 7–0. Staff said the denial preserves the city’s ability to pursue other options and to continue negotiating terms if circumstances change.

What’s next: Staff will continue managing water resources and will return to council with alternatives as appropriate. The council also discussed related water‑supply planning and impact‑fee updates at subsequent agenda items.

Sources: Presentation and Q&A by city water staff; council debate and public comments during the April 15, 2025 Killeen City Council meeting.