Title
Consider/Discuss/Act on a Resolution Authorizing the City Manager to Execute an Annexation Facilities and Developer Participation Agreement with Provident Realty Acquisitions III LLC Related to the Annexation and Infrastructure Improvements Associated with an Industrial Warehouse Project on Approximately 61.922 Acres Generally Located East of State Highway 5 and South of State Highway 121
Summary
COUNCIL GOAL: Operational Excellence
(2.1: Balance available resources to accommodate the growth and maintenance needs of the city)
MEETING DATE: October 5, 2026
DEPARTMENT: Development Services / Engineering
CONTACT: Gary Graham, P.E., PTOE, Director of Engineering
Matt Richardson, P.E., Asst. Director of Engineering
RECOMMENDED CITY COUNCIL ACTION:
• Staff recommends the City Council approve the proposed resolution authorizing the City Manager to execute the proposed agreement.
ITEM SUMMARY:
• This Resolution authorizes an Annexation Facilities and Developer Participation Agreement with Provident Realty Acquisitions III LLC for approximately 62 acres located east of State Highway 5 and south of State Highway 121.
• The agreement establishes requirements for annexation and development of the property and provides for construction of roadway, water, and wastewater improvements necessary to serve the development and the surrounding area.
• The agreement provides for City participation up to to 30% of eligible public infrastructure costs, less a credit for initial water and wastewater system maintenance activities, in an amount not to exceed $6,000,000.
BACKGROUND INFORMATION:
• Provident owns or will own approximately 62 acres located east of State Highway 5 and south of State Highway 121. The property is currently located within the City of McKinney’s extraterritorial jurisdiction (ETJ), and Provident has requested voluntary annexation into the City. Under the agreement, Provident is required to complete annexation and zoning of the property by January 29, 2027.
• The property is proposed for light industrial development. The agreement establishes development regulations for the property and requires the property to be zoned and developed in accordance with those regulations and applicable provisions of the City’s Unified Development Code.
• Roadway and utility infrastructure improvements are required to support development of the property. Provident will be responsible for designing and constructing the required improvements, including improvements to County Road 339 and Fannin Road and extensions of City water and wastewater infrastructure. Final infrastructure requirements and alignments will be determined through the City’s engineering and development review processes.
• The proposed water and wastewater extensions will also expand City utility infrastructure into the northern portion of the State Highway 5 corridor, supporting future development beyond the Provident property, including other light industrial development along the corridor, and commercial and retail development along State Highway 121 near the City of Melissa.
• The agreement provides for City participation in eligible public infrastructure pursuant to Section 212.072 of the Texas Local Government Code. Eligible improvements include certain 12-inch and 16-inch water lines, a 12-inch sanitary sewer line, and improvements to County Road 339 and Fannin Road. The City will participate in up to 30% of actual eligible costs, with total City participation not to exceed $6,000,000.
• The City's participation will be reduced by a one-time $200,000 credit associated with anticipated waterline flushing and sewer inspection and cleaning during the initial years following construction when system demand is expected to remain relatively low. The agreement characterizes this as covering five years of water and sewer maintenance.
• The agreement also provides for an exchange of approximately 0.83 acres of City-owned property for approximately 2.19 acres of Provident-owned property needed for the future County Road 339 alignment. Provident will convey its property to the City at no cost, and the City will convey the existing City-owned tract to Provident.
FINANCIAL SUMMARY:
• Staff has created CIP project CO2742 to fund this agreement using existing budgeted funds totaling $6,000,000.
BOARD OR COMMISSION RECOMMENDATION:
• N/A