SAN MARCOS, Texas (KXAN) — A new film studio coming to Central Texas is facing pushback amid locals concerned about the impact it could have on the water in the area.

Earlier this month, the San Marcos City Council approved incentives “in the form of refunds of a percentage of real and personal property taxes” over a five-year period. Right now, according to city documents, that is estimated to be $4.6 million incentives.

The money would apply to the construction of Hill Country Studios, a film production company, with a minimum of 820,000 square feet of space including production stages, workshops and office space.

The studio would be built within the La Cima Development at West Centerpoint Road and West Wonder World Drive/Ranch Road 12. That’s just southwest of San Marcos near Interstate 35.

Slide from presentation during the June San Marcos City Council meeting of the Project Location. (Source: City of San Marcos)
Slide from presentation during the June San Marcos City Council meeting of the Project Location. (Source: City of San Marcos)

Initially cited in city documents as “Dark Monday” the city council approved a Chapter 380 Economic Development Incentive Agreement with Hill Country Group, LLC. The development would fall on the Edwards Aquifer Recharge Zone, which some in the area are worried about.

Site plan featured in San Marcos city documents
Site plan featured in San Marcos city documents

Why are people protesting the movie studio?

This week, an online grassroots group developed in an effort to “Protect the River.”

“In less than 24 hours, we have 3,500 followers on Instagram,” said Mariana Krueger, Protect the River’s cofounder.

She is concerned the development could put the San Marcos River and the Edwards Aquifer Recharge Zone at risk.

“This is a hugely critical issue,” Krueger explained. “As the San Marcos area continues to grow in population and continues to put pressure on our aquifer, not only is this the source of drinking water for so many already, but it’s the cultural and spiritual hub of the community as well.”

Since this story published, Krueger chose to step away from involvement with the campaign.

The recharge zone is an area where rainwater seeps into the aquifer through faults or fractures and recharges the aquifer.

The aquifer serves as the drinking water source for millions of Central Texans.

Those at the Hill Country Studios said they understand the concerns but added they are “committed” to ensuring “the preservation of the Edwards Aquifer and its recharge zone.”

Addressing water concerns in the Hill Country

During the San Marcos City Council meeting earlier this month, city staff and council discussed the project site already has “entitlements to build” under the 2013 La Cima Development agreement. The city development agreement allows for “community development.”

“When you think about this type of zoning, think about your big box retail strips, office strips that you’d see on a major highway intersection at 80%, impervious cover, very dense, a lot of traffic, a lot of activity,” explained San Marcos Assistant City Manager Joe Pantalion.

Under the city’s proposed guidelines, Hill Country Studios would have to follow several environmental rules including certain height restrictions, water quality guidelines and minimizing impervious cover to under 48%.

La Cima agreement is restricted to 19% impervious cover, which is lower than the current City Code requirements of 40%, 30% and 20%. Those are areas such as rooftops, driveways and parking lots that make it harder for the land to absorb rainfall.

Slide from presentation during the June San Marcos City Council meeting of the Environmental Benefits of Proposed Project. (Source: City of San Marcos)
Slide from presentation during the June San Marcos City Council meeting of the Environmental Benefits of Proposed Project. (Source: City of San Marcos)

Before construction can get underway, the city would require a Stormwater Pollution Prevention Plan (SWPPP) to address erosion, sedimentation control and minimize runoff as well as a Water Pollution Abatement Plan (WPAP) that includes a geologic assessment and geotechnical report for aquifer protection.

  • Slide from presentation during the June San Marcos City Council meeting of the Film Industry benefits. (Source: City of San Marcos)
  • Slide from presentation during the June San Marcos City Council meeting of the Film Industry benefits. (Source: City of San Marcos)
  • Slide from presentation during the June San Marcos City Council meeting of the Film Industry benefits. (Source: City of San Marcos)

The city also reports it expects to collect an additional $2 million in property taxes in 2023-24 because of the studios before incentives kick in 2025. Over a decade, the city also estimates the rebate could result in $11.4 million for the city.

  • Slide from presentation during the June San Marcos City Council meeting. (Source: City of San Marcos)
  • Slide from presentation during the June San Marcos City Council meeting. (Source: City of San Marcos)

“I want my community to know that there is no one, that if I thought this was going to have a detrimental impact, that I would be supporting this,” said Mark Gleason, San Marcos council member for Place 5, during the council meeting.

Approving the new film studio

“Thank you for bringing this here,” added Shane Scott, the San Marcos council member for Place 4, “I’ve been in the film industry for 20 years, and it’s a very difficult industry. I hate that I had to go to LA for the last production I did when we could do it here locally, so this is a real blessing, I think for the community.”

Mayor Jane Hughson commented on the green space that would be maintained with the development.

“There’s one block that’s 700 acres another that’s 91 (acres), another block that’s 390 acres, another that’s 637 (acres) and another block that’s 200 (acres). This is permanent open space, as I understand it, that adds up to over 2,000 acres of permanent open space, this is going to be in La Cima, so I think that this is going to be good to diversify our economy,” she said.

However, not everyone was on board with approving the incentives during that meeting.

San Marcos council member for Place 1 Maxfield Baker questioned where the incentives would come out of, who would be in charge of reporting potential storm water management issues or spills and the requirement of city resources such as firefighters and police.

He also discussed conservation development methods and asked if there would be a possibility for an internship program through the new studio.

“We’ve said it time and time again, ‘oh, our land development code will protect us.’ I know that that’s a favorite phrase from some of my colleagues, but when it doesn’t, what’s the plan? And over such a sensitive area what are we going to do?” he questioned.

Ultimately, the council approved the incentives agreement in a 6-to-1 vote.

Activists feel city ignored them

Those with Protect the River want the option to express their concerns. Krueger, critical of the city and city council, feels like she and others in the community did not have that opportunity.

“It’s concerning to think that a huge development is slated, which was done really in secret without opportunity for public comment from the San Marcos City Council. That this project was slated in such an environmentally sensitive and critical area,” she said.

“The aquifer contributes drinking water to 2 million people who live in the San Antonio and Austin areas and as we continue to grow, of course, access to clean drinking water will become more important.”

They hope Wednesday’s virtual meeting at 12 p.m. on Zoom will allow them to gather their comments and they have been working to develop a petition. They also plan to gather on Tuesday to protest.

“We welcome you to the cause to go up against big corporations and the powers that be,” Krueger said, “It’s going to take a strong and unified effort from a variety of people who are willing to take bold and creative action. So we don’t need to be limited to the traditional parameters on these kinds of things, we need to think big and creatively because the stakes are so big.”

A Hill Country Studios aerial rendering of the site. (Source: Hill Country Studios)
A Hill Country Studios aerial rendering of the site. (Source: Hill Country Studios)

Hill Country Studios CEO was unavailable for an on-camera interview in reference to this matter before news time, but Cory McLoud provided this statement:

“We’re committed to working with our neighbors in the greater city of San Marcos to ensure the preservation of the Edwards Aquifer and its recharge zone, which has been Hill Country Studios’ first priority since day one. Throughout the entire construction process and post-build, Hill Country Studios will maintain an extensive greenbelt, and ensure the property meets all zoning regulations. Our designers and engineers are exploring every option relating to environmental protection, including retention ponds, rainwater collection cisterns and much more. The Texas Hill Country is our backyard, so we understand and value the importance of the aquifer to our community.”

Cory McLoud, Hill Country Studios CEO