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McGregor approves 499-acre sale and development agreement with GXMG LLC for 'Project Merlin' data center
Summary
The council approved sale of about 499 acres to GXMG LLC (a Galaxy Digital subsidiary) under a development agreement that commits to a minimum $400 million capital investment, a $130 million property-tax base, creation of at least 30 full-time jobs at a $60,000 minimum salary, and a water cap of 3,000 gallons per day per power shell; GXMG also said it will fund transmission and substation upgrades and employ closed-loop cooling.
The McGregor City Council voted June 22 to sell roughly 499 acres of city-owned industrial land to GXMG LLC, a subsidiary of Galaxy Digital, Inc., and approved a development agreement for the project the presenter called "Project Merlin." The vote passed by voice vote; the transcript records at least one 'nay' but states the motion carried.
A GXMG representative identified in the record as Mr. Luna described the development agreement’s minimum obligations: a $400 million minimum long-term capital investment, a $130 million property-tax base, and an obligation to create at least 30 full-time jobs with a minimum salary of $60,000 per year. "And these numbers ... are the minimum. So that $400 million capital investment, we're going to hit that. It's probably going to be more," Mr. Luna said.
Mr. Luna addressed three community concerns commonly raised about data centers—water, noise and power—and described mitigations the agreement requires. He said the development agreement caps water at 3,000 gallons per day per power shell and limits power shells to 10 (though GXMG expects to build fewer). He described closed-loop cooling with onsite storage to minimize municipal water draws: "It's an initial surge which will come from our onsite storage which isn't going to have any draw down on the city's water supply," he said.
On noise, Mr. Luna said GXMG conducted baseline monitoring and designed "box within a box" enclosures and other mitigation so operations would stay below roughly 65 dB at monitoring points. On power, he said GXMG will fund transmission-line upgrades and construct a private substation; the local utility (Brazos) would own and operate a breaker, and GXMG said it will pay related upgrade costs rather than shift them to residential taxpayers. Mr. Luna referenced a June 10 memo from Governor Greg Abbott emphasizing full-cost infrastructure payment, water-efficiency technology and reporting and said GXMG had already addressed those items in negotiations.
Council members asked whether the project would affect city water supplies and about comparisons to local restaurants’ water usage. Mr. Luna responded that residential supply would not be affected and reiterated closed-loop systems and onsite storage to meet initial needs. After Q&A, council approved the sale and development agreement by motion; the transcript records a recorded 'nay' but the motion carried. The meeting then adjourned at 1:21 p.m.
The transcript includes the development-agreement commitments described by the GXMG representative but does not include the full contract text or details such as timelines for infrastructure upgrades or enforcement provisions; those items are not transcribed in the meeting text and require review of the development agreement for verification.
