San Angelo: Next Data Center Boom

Chamber of Commerce executive Mike Berry spoke with Tammy Ramos from KLST on the potential of incoming data centers.  Berry noted they could flip San Angelo's taxation from primarily residential to business dominated.  

Mike cited area draws for data center location include excess power availability, abundant land (cheaply priced), proximity to natural gas, onsite solar generation, as well as state tax incentives.

Berry shared that City and County leaders are focused on adding infrastructure to accommodate this growth.  The level of capital investment represents billions of dollars.  Tax revenue comes from added business investment.

Berry noted one transaction could "potentially flip the ratio and take the burden of property taxes off the resident and push it back over to the business side."

Tom Green County Commissioners Court and San Angelo's City Council have taken the lesser taxation approach to date with several recent economic development projects.  The City of San Angelo granted Peregrine Energy's Zeppelin Battery Storage Farm an 85% tax break for three years.  Tom Green County gave Doral Renewables LLC Cold Creek Solar project a significant tax abatement via a payment in lieu of taxes arrangement.

At the time of the Zeppelin tax break the City needed funds to help retirees on their city sponsored health insurance.  Council chose to add two new deductibles to loyal longtime employees, many on minimal retirement incomes.

Residents don't have to look far to see San Angelo's future, only 86 miles north in Abilene.  Lancium or Project Ludacris started as a bitcoin mining, cheap energy arbitrage play but got swallowed by AI and was "the first Stargate" featured at President Trump's AI event.

Big Country Homepage reported:

Taylor County commissioners agreed to amend a tax abatement for the Lancium project. This abatement will allow Lancium to forgo paying taxes on 80% of their property value to Taylor County for the next 10 years  

Once the first two buildings are occupied and the Lancium project is underway – Taylor County will see $4 million to $4.5 million a year in revenue.

That's nothing to scoff at but San Angelo's annual budget is much larger according to the city website:

The City of San Angelo is projecting $261.79 million of revenue in FY2025

San Angelo Live reported in 2022:

Residential property taxpayers comprise 71 percent of property tax revenue generated. Commercial property generates only 14 percent of money to the City general revenue fund via property taxes. The remaining 15 percent of property tax revenue comes from taxable personal property, inventory, and business fixtures.

Skybox Data Centers is coming and Cloudnium believes the next data center boom will occur in San Angelo (where they already have a presence):

San Angelo, Texas, is poised to become the next major data center boom location, thanks to its unique advantages and the visionary leadership of Cloudnium.net. With its central location, business-friendly environment, robust infrastructure, and emerging tech ecosystem, San Angelo offers unparalleled opportunities for data center investment and growth. As Cloudnium.net continues to lead the way, the city is set to become a key player in the global data center landscape, driving economic growth and innovation for years to come.

Visionary leadership of Cloudnium....how many fingers are in this pie?  

City retirees already felt the mis-prioritization of recent high-tech tax abatements.  Who's next to get short shrift so Lancium, Blackstone, Crusoe, Blue Owl Capital, Microsoft, OpenAI and Primary Digital Infrastructure can make big money?

TIRZ Funds Bars, Bans Churches

San Angelo City Council finally put an end to potential TIRZ funding for nonprofit organizations in the North zone.  It has never been allowed in the South TIRZ zone.  Mayor elect Tom Thompson made the motion and it passed 6-1.  Councilperson Lucy Gonzales, the lone "Nay vote", said the issue has been going on for eight years and a nonprofit has never received TIRZ funding. 

The City Attorney informed Council it will need to pass ordinance changes to comply with Thompson's successful motion.   Next up on the agenda were three TIRZ projects, two bars and one retail establishment.

Voters approved a $41.6 million bond for Coliseum improvements for a nonprofit Rodeo Association.  

SASSRA will execute a “Chapter 380” agreement required for the bond process. SASSRA will assume maintenance and operations of the Coliseum. At that time, the operation of the Coliseum will be transferred into the existing lease agreement between COSA and SASSRA.

City Council had to approve the item being on the ballot.

The City of San Angelo gave $2 million to nonprofit Angelo State University for the pilot training facility.  It did so via the Development Corporation.

San Angelo's City Council has funneled big money to major nonprofits.  Yesterday it turned down staff's recommendation to allow nonprofits to access a portion of North TIRZ funding.  It did so permanently and without apology.

Animal Taskforce to Present to Council

City Manager Daniel Valenzuela's Animal Services & Control Taskforce, formed in January, will present their findings to City Council at the May 6, 2025 meeting.  

Vallenzuela formed the taskforce to "address critical issues related to animal services and control. The initiative was authorized by City Council and aims to develop effective, objective solutions to prioritize public health, safety and animal welfare."

The Animal Taskforce report comes during a time of flux for Council.  This will be Mayor Brenda Gunter's last meeting.  Councilman Tom Thompson won this weekend's Mayoral election and will be installed at a future Council meeting as will winners of two of the three open Council seats.  One Council position will go to a runoff election, scheduled for June.

The taskforce report comes as the Animal Shelter Advisory Committee increased its meeting frequency and is tackling more substantive issues.  

The Taskforce is addressing issues created by the shelter's adoption of "best practices" from American Pets Alive and Best Friends Animal Society.  Both groups reduce shelter intake without a focus on spay/neuter, effectively endorsing a "let them roam unaltered" policy.  

Years of choking off shelter intake gave San Angelo third world levels of loose animals.  City staff noted the increase in "animal on people" bites and the Taskforce was formed in the aftermath of the horrific dog attack on Animal Control Officer Floyd Bias, who has physically healed and returned to work.

Best Friends Animal Society has a parallel effort going which could result in a public-private partnership proposal for City Council.  If such a proposal were in the works, that could explain a portion of the two year delay in renovating the current shelter building.  Council approved borrowing funds for this urgent need in early 2023.

It will be interesting to hear the Taskfoce's analysis and recommendations, as well as to see their reception from key players on the current and evolving City Council, city leadership, an invigorated Animal Shelter Advisory Committee, Animal Services staff and the general public.  

Everyone do their best to listen, incorporate the information shared and breath deeply several times.  It's an opportunity to hear from thoughtful, knowledgeable leaders on ways to address a growing, heretofore intractable problem for both people and unhoused pets. 

Update 5-7-25:  Taskforce Chair Judge Allen Gilbert led the presentation at City Council and all members participated in presenting recommendations.  A new City Council under Mayor Tom Thompson will consider the Taskforce's recommendations during the upcoming budget process.  

Update 5-8-25:  ConchoValleyHomepage ran a story on the Taskforce's presentation to Council.

Trickle Down: Elections, Projects & Jobs (?)

Commerce Secretary Howard Lutnick said bitcoin miners would locate above natural gas fields, using the flared gas to generate power.  He also said government needed to assist in the development of such infrastructure (buildings and associated power plant).    

Lutnik's son Howard has a major role in a new bitcoin company, while the Trump boys AI venture switched over to bitcoin mining, American Bitcoin.   The Sons of Monarchy expect concierge service.

Both the City of San Angelo and Tom Green County have been very accommodating to new energy sources (solar, battery storage) and I expect the same to happen with Skybox Data Centers.  So far, the city and county have given significant tax breaks to projects providing zero to just a few jobs.  That likely will continue.

So who would facilitate development in our region?  It would have to be someone with access to resources.  That usually means a municipality, given the sparseness of county government in our region.  City managers and Mayors have development staff, resources and budgets.  

The City of San Angelo holds elections next week for the Mayor slot and three City Council seats. 

Current City Councilman Tom Thompson is running for Mayor on economic development.  His website states:

Economic development encompasses housing, commercial growth, and public-private partnerships, all aimed at sustainable tax base expansion. 

We must prioritize welcoming new opportunities and streamlining development processes. Collaborative efforts with the Chamber of Commerce and Direct Marketing Organization are underway, and over $40 million in permitted commercial expansions and improvements are scheduled. We will pursue public-private partnerships to accelerate economic development and ensure tangible benefits for our community.

Thompson did not mention Council's strange conflict with the Chamber of Commerce's Walt Koenig or their heavy handed treatment of John Bariou, who did much for the Economic Development Board during his multiple stints.  Bariou is running for City Council District #2 (Thompson's current seat).

Candidate Thompson pulled a page from former Mayor Alvin New's playbook in targeting area nonprofits as non-taxpayers.  He should recognize the city fits that bill, as does his prior employer for ten years, the San Angelo Rodeo Association.

Council left millions on the tax table (Peregrine Energy Battery Storage Farm) before foisting two new health insurance co-pays on city retirees, many struggling on a miniscule fixed income.  

Thompson said "economic development is crucial for maintaining and lowering tax rates."  How about applying those rates to new commercial entities, especially those of the jobless variety.

Update 5-3-25:  Tom Thompson has been elected Mayor of San Angelo.

Update 5-7-25:  Council passed the sale of land to Skybox Data Centers in their May 6th meeting.

Tom Thompson's Public Safety Push: Animals Not Included

San Angelo Mayoral Candidate and current Council member Tom Thompson is focused on public safety, at least the departments that don't involve stray animals.  Police and Fire need to expand to serve the community as it grows.  The power vested in the Mayor is chairing City Council meetings and hiring the City Manager.  Should Thompson win, he would need the majority of Council to direct staff to prioritize the development of Police and Fire Departments.  

Animal Services is the third wheel in public safety.  I suggested in June 2022 that City Council consider Animal Services in their strategic planning sessions, providing Council members data from public information requests.  That did not happen, even though the suggestion fit with Thompson's "need to keep pace" public safety vision.

Just days ago, Animal Shelter contractor Concho Valley PAWS sponsored an animal focused candidate forum which Thompson could not attend due to prior commitments.  He did however send a written statement.  

PAWS served as the shelter's adoption coordinator and veterinary services provider for at least seven years.  PAWS has been there for the various crises, including the roach infestation/horrific hoarding conditions (September 2022).   Tom Thompson instructed staff in its aftermath to implement a hard cap on shelter capacity (November 2022).  He did so during a City Council meeting informational agenda item, one that required no vote.  

Thompson's letter cited funds set aside for Animal Shelter renovations, which Council clearly stated just gets the existing building to a functional state and does not take into account people or pet population growth.  

Should a candidate be proud of approving borrowing $1.6 million in early 2023 for a project that is yet to be bid over two years later?  

The city already had a $345,000 capital budget for shelter improvements when Council approved the first short term debt borrowing.  That makes up the majority of Thompson's "$400,000 in sales tax" money for the project.  

Tom Thompson has a record on public safety.  He's lucky animals can't vote.  

Update 4-29-25:

Leadership grounded in facts, absolutely.

Update 5-2-25:  The special Animal Services Taskforce will present their analysis and findings to City Council at their next meeting to be held on May 6, 2025.

Update 5-3-25:  Tom Thompson has been elected Mayor of San Angelo.

Update 5-14-25:  The Treasurer for Mayor Thompson's victory is former City Clerk Julia Antilley.  Mrs. Antilley was the force behind limiting citizen access to public information to thirty six hours of staff time in the fiscal year.  

Shelter Renovations: Projected Completion February 2026

City staff updated the Animal Shelter Advisory Committee on the status of shelter renovations.  San Angelo City Council approved borrowing $2 million in early 2023 as the need for the project was urgent.  

Shelter Chief Morgan Chegwidden referenced that borrowing in her ASAC presentation.  Does that mean the city paid interest over the last two years for a project that is still in the engineering phase?

Morgan shared there would no commercial laundry equipment as the city had difficulty arranging maintenance of those washers and dryers.  She said there would be a cost associated with additional electric service due to AEP's need to add capacity to ensure the new HVAC system could operate properly.

Construction Manager Al Torres indicated the engineers need three months to finish the updated electrical and he expects City Council to approve the project in their first meeting in August with construction starting that month.  If that schedule holds, it would be two years since the City paid back the first bond intended to fund this project.  

Torres expects shelter renovations to be complete in February 2026, three full years after City Council approved funding this urgently needed project.

Staff indicated there have been issues with the temporary shelter and getting that building ready.  Torres shared that the temporary facility would be finished in August, just in time for renovations to start on the existing shelter building.  He is working with a Buyboard contractor on the temporary shelter plans.  

Morgan stated that shelter staff is not sufficient to do enrichment (supervise play yards) at the main shelter and did not see availability to add enrichment at the temporary shelter site.  Later, Morgan revealed that shelter pets "do not go outside" under current facility operations.

It remains to be seen what comes before City Council as the main shelter renovation planning continues and the temporary shelter is made ready.  Many Council positions will change after the May election is concluded.  Departing Council members heard repeated missed timelines.  Hopefully, that won't be the case for newly installed officials.

Update 5-2-25:  The special Animal Services Taskforce will present their analysis and findings to City Council at their next meeting to be held on May 6, 2025.

City of San Angelo to Subsidize Railport Outside City Limits

City Council will consider a two step move to facilitate the further development of the San Angelo Railport.  Step one is to sell city land to the Development Corporation for $1.4 million.  Step two is for Wisener Holdings, LLC dba South Plains Lamesa Rail Road, to pay $1 million in cash and for the remaining $400,000 subject to repayment under an economic development agreement.  

Council's background packet states:

COSADC will carry a loan for $400,000 payable over 5 years at $80,000 per year. Loan payments will be offset at a rate of 50% for capital investment in infrastructure improvements to the property.

If the Railport owner spends $160,000 per year on capital improvements over the next five years the city would forgive the $400,000 loan.   What are Weisner Holding's plans regarding capital improvements?  Surely, they have a budget for such.

The Railport is outside City limits so there are no taxes received by the City of San Angelo for the project.  City staff's background information makes no projections as the number of jobs added, a key goal of the Development Corporation.

This could be the second major subsidy for a capital project that provides no discernable direct jobs.  Council approved an 85% three year tax break worth $2.2 million to Zeppelin Battery Storage.  At least that project is within City limits.  

The item is included in the Consent Agenda, which means a member of Council needs to request it be moved to the Regular Agenda for the public to receive a staff presentation.  Even with such a request, a presentation is not assured.  

Hopefully, an astute member of City Council will pull the item to clarify who is actually paying closing costs.  The following is stated in one place:

The purchase price from the City will be the approximate appraised value of $1,400,000 plus closing costs. The sale price to SPLRR will be $1,400,000 plus closing costs.

Later the packet states:

Net cost is $400,000 plus closing costs.

In the end, who is paying those closing costs?

Why should the public be concerned?  Because not long ago Council required City retirees to pay an additional $500 annual deductible and an additional $250 co-pay for outpatient surgery.  

Two weeks later Council approved the initial tax abatement request from Peregrine Energy for the Zeppelin project.  That abatement was finalized last meeting.

West Texas is front and center for energy and projects requiring energy.  Council approved a letter of intent to sell land close to the Railport to Skybox Data Centers.  A new data center has the potential to create jobs.

The three new projects, Battery Port, Rail Port (expansion) and Data Port are in close proximity.  It remains to be seen how much citizens will subsidize Skybox's data center, but the first two total $2.6 million.  City retirees may be concerned about giveaways that could have been used to keep their coverage stable with no increases in insurance costs.

Update 3-31-25:  The Development Corporation approved the Railport land subsidy and indicated the operator "will spend alot more than $400,000 on improvements."  That left the impression that the interest free loan will be forgiven in total.

Update 4-1-25:  The $400,000 subsidy passed alongside other items in the Consent Agenda.

Update 4-17-25:  City Council approved a budget amendment of $1.4 million for the Development Corporation to purchase the land from the city.

Update 5-7-25:  Council passed the sale of land to Skybox Data Centers in their May 6th meeting.