Commissioners Reject Cloudburst Tax Abatement After Residents Raise Water and Transparency Concerns

Guadalupe County commissioners considered a tax‑abatement agreement with Cloudburst Texas LLC on Feb. 24, 2026, but the motion to approve failed on a 2–3 vote after an extended public hearing that centered on groundwater, transparency and contractual guarantees. The court had been presented a Cloudburst plan for a 3,000,000‑square‑foot campus and a $14.5 billion capital investment; Cloudburst argued the project would create high‑paying local jobs and use closed‑loop cooling that requires far less municipal water than comparable residential development.

Cloudburst’s executive chairperson, Alex Gerber, told the court the campus would have 10–12 AI‑ready buildings, about 480 permanent jobs at full build‑out, and an estimated 24,000 gallons per day for the closed‑loop cooling system’s annual top‑off. “Our planned data‑center campus is a $14,500,000,000 investment,” Gerber said in the presentation and added the company plans behind‑the‑meter generation and rainwater catchment to limit pressure on the local grid and municipal water supplies.

Residents and several speakers urged the court to withhold approval until more documentation and enforceable guarantees were provided. Lehi Rodriguez, a county resident who cited Texas Water Development Board data, said declines in multiple monitored aquifers make it “clear that every major development decision…must be evaluated with full transparency and long‑term planning in mind.” Retired water‑treatment specialist Richard Ashcraft told the court large data centers can use vast volumes of water and questioned whether utility systems would give priority to industrial users in drought conditions.

Several commissioners said they needed written, signed agreements showing how potable and cooling water would be supplied and constrained, and one commissioner said the water‑use numbers presented in court were only recently finalized by Cloudburst’s prospective tenant. After debate, the motion to approve the abatement failed 2–3. County staff and Cloudburst representatives said additional technical and contractual materials were being prepared and that some details had been provided to court members in the days before the meeting.

The record shows Cloudburst sought a 10‑year abatement with declining percentages over time (higher abatements in early years that taper by later years) tied to building investment only; the court heard that the abatement under consideration would not apply to the tenant’s internal equipment. The rejected motion leaves open the possibility of further negotiations; separate, related items to expand an existing reinvestment zone and amend a prior Palomino Alpha agreement were addressed elsewhere on the agenda.