Memphis activists press for binding terms as council and MLGW debate XAI graywater plant and aquifer risks

A packed committee hearing on June 23 turned into an extended exchange over a planned water‑reuse facility on land sold to XAI (referred to in testimony as XAI/Colossus) and the potential effects on the Memphis aquifer.

Sarah Houston, executive director of Protect Our Aquifer, told council the aquifer is a critical drinking‑water source with known breaches in protective clay layers and areas of significant drawdown. She said the proposed water‑reuse facility (sometimes described by advocates as a graywater or recycled‑water plant) is intended to treat municipal effluent for industrial reuse, but she urged legally binding commitments — not verbal promises — from XAI/SpaceX and other industrial users to protect drinking water, ensure workforce and community benefits, and provide public monitoring and transparent water‑quality data.

Houston recounted a timeline of land sale, permit filings and construction activity and said a whistleblower and subsequent internal changes at XAI led to an "indefinite pause" reported in the media. She asked council to press for a public hearing with company leadership and to seek enforceable written guarantees for reuse, community access, workforce pipelines, and contingency planning if the plant is not completed.

Doug McGowan, MLGW president, responded with a historical account: he traced recycled‑water planning to 2018 discussions among city, MLGW and TVA, said MLGW had modeled a $200 million plant and that XAI later approached the city and offered to help fund a facility designed to serve both XAI and TVA. McGowan disputed higher circulating water‑use figures and said the contract with XAI limits direct MLGW water sales to 1.28 million gallons per day; he said MLGW produces less water today than in 2000 because of conservation measures and that the city and SpaceX leadership have a verbal commitment to restart plant construction in Q1 2027, with a written timeline expected soon.

Ta Gibson, the city’s chief legal officer, cautioned council that community presentations sometimes omit contractual nuance and liability tradeoffs. Gibson confirmed the land sale and license agreements are commercial contracts that do not obligate a purchaser to build a particular facility, but she said the city retains protections — including the ability to reclaim ("claw back") land if the property is not used as contracted — although remedies and the disposition of improvements would require negotiation.

Council members pressed for clarity about contractual protections, asked whether permits allowed 5 MGD (millions of gallons per day) as some documents suggested and whether the city could require binding commitments. McGowan and Gibson said permit allowance and contract limits differ; McGowan noted the state permit referenced a higher design threshold in some documents but emphasized the MLGW contract limit of 1.28 MGD. Several council members asked administration officials to return with a written timeline and with recommended contractual language and community benefits to reduce risk to the Davis wellfield and nearby neighborhoods.

Ending: The committee did not adopt new binding terms at the hearing; MLGW and the mayor reported they had met with SpaceX leadership and expected a written timeline and additional details. Advocates called for continued pressure, greater transparency and legally enforceable protections for the aquifer.