How a Bid to Beat Drought Drove Corpus Christi to the Brink of Disaster

This story is a partnership between Dylan Baddour of Inside Climate News and Neena Satija of The Texas Newsroom.

Eight years ago, at the height of the shale-oil boom, a committee of industry giants and public officials unveiled a bold plan to make Corpus Christi “drought proof.”

With this plan, a consultant explained to city officials at the time, their semi-arid stretch of coastline in South Texas could finally overcome the economic limitations of its scarce water supply.

“Industry can continue to operate,” said a slideshow the consultant, Frank Brogan, presented to Corpus Christi City Council. “Industry can justify expansion. Community can attract new industry.” 

The plan seemed simple. The region’s largest water users—Texas-based titans like OxyChem, Valero and Citgo—would pay Corpus Christi to build the state’s first-ever seawater desalination plant, which would produce millions of gallons of freshwater per day at minimal cost to the public. In exchange, the companies wouldn’t face pressure to throttle back operations at their refineries and chemical plants during future dry spells.

“We don’t want to have the reputation of having a water problem,” said Brogan, a former executive at the Port of Corpus Christi, the top U.S. port for crude-oil exports, in the August 2018 presentation.

City leaders unanimously approved the plan, hailing it as a breakthrough: Giant corporations had agreed to front the money for an innovative project that other communities could only dream of affording.

But instead of securing Corpus Christi’s water future, the plan pushed Texas’ eighth-largest city to the brink of a water-supply disaster, burned through tens of millions of public dollars, and engulfed the city in political turmoil. 

The city has spent at least $50 million on the promised desalination plant, but it has yet to materialize—a victim of political dysfunction, the coronavirus pandemic, rapid inflation and frequent turnover in the city’s political leadership, among other factors. And the companies that had originally agreed to pay for it now contribute only a fraction of what the plant is expected to cost. Residents would have to pay for the rest. 

Meanwhile, Corpus Christi has honored the commitment it made back in 2018: It has not pressured the companies to cut back on water consumption, even when the area slipped into a punishing drought.

By this spring, the region’s main reservoirs almost dried up entirely. The industrial giants raced to drill emergency water wells, the city’s credit ratings slipped, and local business leaders raised the specter of mass layoffs if the water ran out. 

In the face of an unprecedented emergency, city officials debated meager measures like closing public pools and fining residents for washing cars, rather than imposing restrictions on the chemical plants and refineries that use more water than all 500,000 residents of the seven-county Coastal Bend region combined. 

“The reason we were in the water crisis was because of their water usage,” said Isabel Araiza, a college professor and founder of a community group called For the Greater Good who has fought for a decade against the desalination project.

Bob Paulison, executive director of a trade group that represents the industrial giants, said they are not responsible for the crisis. He said the city’s leaders were tasked with building a drought-proof water supply with funding the companies provided, and they didn’t deliver. 

Of Corpus Christi, he said, “you kept dragging your feet and thinking that everything was OK until it was too late.” 

Gov. Greg Abbott also placed the blame squarely on Corpus Christi earlier this year, telling reporters in March that city leaders “squandered” massive state loans awarded to them for the project. 

But a review of public records spanning more than a decade shows that the industrial giants also played a critical role in developing the failed plan. 

Those companies initially sought to build a private seawater desalination plant solely for their own use. They later decided to team up with city officials on a public project, which allowed them to access hundreds of millions of dollars in low-interest loans from the state. 

City and industry officials believed their partnership would guarantee Corpus Christi a prosperous future. Instead, it has become a case study into the pitfalls of tying an essential public resource to the growth ambitions of private industry. 

Corpus Christi no longer faces an acute water crisis, thanks to heavy rain this summer. But its near brush with disaster has turned some residents against the same corporations that power the economy in one of Texas’ leading industrial hubs.

Now, a proposal to nullify the 2018 plan will be on the local ballot in November, following a successful petition campaign by Araiza and other activists. The proposal seeks to eliminate the protections from water restrictions that city leaders gave the industrial giants almost a decade ago and instead dramatically increases the price they would pay for water during the next drought. 

If voters approve the measure, it would represent a dramatic about-face for governance in a port city that has long stayed faithful to private-sector leadership.

“It’s a referendum against the system,” said Roland Barrera, a fourth-term Corpus Christi City Council member, of the ballot measure. “I don’t think it ends well.” 

Joe McComb, who was mayor when the city enacted the 2018 plan, said Corpus Christi’s wellbeing is at stake. The city needs industry, and industry needs water.

The activists, he said, want to break the economic backbone of the region. 

“They’re wanting to try to punish the industry,” McComb said. “If industry shuts down, Corpus Christi will be just a fishing village again.”

Dreams of a Drought-Proof Water Supply 

To McComb, the desalination project represented a generational dream to overcome the tiresome cycles of drought that have burdened Corpus Christi for as long as anyone can remember.

During McComb’s first term on City Council, in 1984, the city’s water supplies dwindled to the point that leaders ordered a 25 percent cut in water use. The refineries and chemical plants also suffered. 

“Water cuts fuel oil industry woes,” one local newspaper headline trumpeted at the time, just weeks before historic rainfall eased the crisis. 

“That was a traumatic experience,” McComb recalled. 

City leaders vowed it would never happen again, so they built a second, larger reservoir, called Choke Canyon. When drought conditions became dire again, in the 1990s, Corpus Christi built a 100-mile pipeline to Lake Texana. The worst drought yet struck in the 2010s, so the city built another pipeline, to the Colorado River. 

After that, Corpus Christi had no lakes or rivers left to tap. Practically every body of water had been spoken for, except one: the Gulf of Mexico. 

Extracting all the salt out of that water would be expensive—there were no desalination plants in the U.S. at the time—but it would lead to a truly drought-proof water supply.

So in 2014, a dozen of the region’s largest water users formed a group to discuss building such a project. 

The committee included OxyChem, Valero, Citgo and Flint Hills Resources, according to its commissioning document. Local business-development and city officials were also part of the group. 

“The industries were looking at possible ways to protect themselves,” said Mark Van Vleck, then the assistant city manager, in an interview. “So we wanted to be part of that discussion.” The companies did not respond to requests for comment. 

Paulison identified himself as the group’s coordinator during a City Council meeting in September 2015. The proposed plant, he explained to council members, would produce “non-potable water for industrial use only.” Importantly, “the water that they were purchasing would not be subject to water rationing.” 

He added that the clock was ticking. Hydraulic fracturing had sparked a boom in the oilfields of Texas, leading to a spate of new pipelines to the Gulf Coast. The industrial users in Corpus needed to expand in order to process that oil and gas into fuels, petrochemicals and plastics. But water was holding them back. 

“Water was beginning to become an issue as to the attractiveness of the Coastal Bend to new industry,” Paulison told City Council, explaining the companies’ desire for a desalination plant.  

“I can’t tell you how much I appreciate industry,” said Nelda Martinez, the city’s mayor at the time, at the meeting in 2015. “We depend on your growth, and we are proud of the partnership we have, and I look forward to seeing this through.”

The City and Industry Team Up 

By 2016, the industrial giants concluded it was too expensive to build their own desalination plant, Paulison said. They’d have to build their own pipeline distribution system, and even then, they would still need a way to connect to the city’s pipes as a backup. 

So the committee of energy and chemical companies and public officials began discussing a new strategy: The city would build the project and connect it to the existing municipal water supply, which already serviced the industrial giants.

The advantages for the companies went beyond sharing the city’s pipelines. Just a few years earlier, Texas voters had approved a plan to use billions of dollars to help finance new public water projects across the state. Building a public seawater desalination project, rather than a private one, would unlock access to cheap state loans.

“Public ownership offers significant cost savings,” Paulison told City Council members in February 2016. 

He added that the committee was working to accomplish the project at no cost to the city’s 317,000 residents, acknowledging, “That is a very difficult proposition.” 

A few months later, Araiza, then an associate professor at Texas A&M University-Corpus Christi, learned about the plan and attended a council meeting to offer her critique. 

“Corpus Christi wants to sponsor a water desalination plant,” she told City Council on July 19, 2016. “While private industry is set to be responsible for the majority of the growth in water consumption, the city seeks to use the public’s resources.” 

Almost a year later, the question of whether—or how much—the public would have to  pay for the plant hadn’t been resolved. But the clock was ticking. “Industry requires a non-interruptible water supply,” said meeting minutes from a workshop Paulison gave on desalination in 2017. “Timing is critical.” 

Nevertheless, industrial growth was well underway. Big expansion projects had come online at OxyChem, Valero and Flint Hills. And Corpus Christi was still courting a new ExxonMobil plastics plant that would eventually become the largest water user in the region.

That summer, the city received its first $2.7 million state loan for the desalination project. It used the funds to pay Texas-based engineering firm Freese and Nichols to assemble a team of international experts on seawater desalination, study potential sites for the plant, and prepare permit applications.  

During a City Council meeting in October, members pointed out that there was still no plan to pay back that loan without charging the city’s residents.

“I understand that industry needs water,” said council member Carolyn Vaughn. “I want to see a plan to pay this loan back.”

McComb, who by then had been elected as the city’s mayor, said he was confident the large industrial users would agree to foot the bill. In the coming weeks, he said, city officials planned to “meet with industry folks to see what works best for them.” 

Rick Ritter, the plant manager for OxyChem in Corpus Christi, the region’s second largest water user at the time, told council members he was on board. 

“I could almost build my own desal plant,” he said. “But we prefer a regional approach.” 

Industry Agrees to Foot the Bill, But the Bill Goes Up 

In July 2018, the committee of industry giants and their city and port partners were finally ready to unveil their plan to pay for Corpus Christi’s “drought proof” water-supply project. 

They proposed amending Corpus Christi’s drought-contingency plan, or procedures the city could turn to when water supplies ran low. The procedures allowed the city to compel conservation by imposing fines called drought surcharges. The fines could increase the water rates for some users, including refineries and petrochemical plants, by more than 100 percent. 

Under the proposed amendment, those large industrial water users would be exempt from such fines if they agreed to an immediate water-rate hike of about 8 percent. The rate hike was called the drought surcharge exemption fee, and it would be used to pay off loans the city would take out to build the desal plant. 

“It’s obviously very important to our business, the long-term assured availability of water,” said Roger TenNapel, a development manager for Flint Hills Resources, during the 2018 City Council meeting where the drought surcharge exemption fee was unveiled. He said he was speaking on behalf of the region’s five largest water users.

McComb, the mayor, called it “a giant step for the city.” Esteban Ramos, the city’s water-resource developer, also called it a “great event,” adding, “This will be the funding source for our future water supply.”

By 2019, city leaders decided the money would go specifically toward building a seawater desalination plant in a place called the Inner Harbor, on a 14-acre tract in the historic heart of Corpus Christi.

In August, Assistant City Manager Van Vleck told City Council members that a desalination plant producing 10 million gallons of water a day would cost $140 million. The new water fees collected from the industrial giants could cover payments on loans for that amount, he said, especially with low interest rates from the state. 

Van Vleck said the project needed to be ready by early 2023. That’s when the region’s water demands would experience a “major jump,” he explained, due to the opening of the new ExxonMobil plastics facility. 

He said the footprint of the desalination plant would be large enough for the city to later expand the facility, at additional cost, to produce up to 30 million gallons a day. 

The council unanimously agreed to move forward. They directed city staff to prepare applications for more state loans to build the desalination plant.  

“I think it’s just a great plan,” said council member Greg Smith.

Van Vleck resigned at the end of 2019 following a disagreement over an unrelated infrastructure project. Still, he thought he had set the city up for success.

“We were on track to make that happen when I left,” he said of the desalination plant in an interview. 

But in early 2020, city officials updated the plan. 

“The region really realized that 10 million gallons a day was not going to be enough,” said Peter Zanoni, who became Corpus Christi’s city manager in 2019, in an interview.

In February, city staff told council members they now wanted to build a plant producing 20 million gallons of water a day, not 10. And they said it would cost $220 million, not $140 million.

“This is a substantial increase,” Gil Hernandez, who was serving his first term on City Council, said at the meeting. “The surcharge that we’re getting from industry would not cover the cost.”

The drought surcharge exemption fee would cover two-thirds of the loan payments, rather than the full amount, city staff wrote in a memo at the time. Residential rate payers would be on the hook for the rest.

City Council members agreed to move forward with the project by applying for a $222 million state loan in the spring of 2020. 

Hernandez cast the only vote against the application. He said the city should compare prices with other potential water-supply projects. 

“I’m not against desal,” he said at the City Council meeting when the loan application was approved. “But I have some issues with not getting any other information on alternatives.” 

Paulison said he was not involved in the city’s decision to pursue a larger, more expensive project, and he doesn’t know why it happened. He added that by this point, the companies that had originally proposed the desalination plant and agreed to help fund it were not nearly as involved in the execution of the plan as they had been originally. 

“The dynamic changed,” he said. “The communication was just never the same as it had been before.” 

The Plan Is “Stuck”

The city had hoped to break ground on the desalination plant in 2021, but the year came and went with no real progress. 

“The process is sort of stuck,” said the city’s new water department head, Mike Murphy, at a City Council workshop on desalination that summer.

The coronavirus pandemic had shut down the country and much of the world, disrupting global supply chains and the normal functioning of government. Another drought was also beginning to set in, eventually becoming the worst in the city’s history. 

In late 2021, ExxonMobil’s new plastics plant came online. It is now the region’s largest overall water user, though Paulison pointed out it uses about half the water it was expected to when the venture was first announced.

“They engineered in significant amounts of efficiency,” Paulison said of Exxon. “And then they achieved it.”

A spokesperson for ExxonMobil declined to comment for this story.

Exxon’s expansion highlighted the increasingly urgent need to move the desalination project forward, City Manager Zanoni said, because the city had signed a contract with the company years earlier promising to provide it with massive amounts of water.

If the city didn’t deliver, he said, “Exxon can hold up this contract and say, you know, you owe us this water.” 

But opposition to the desalination project was growing. Activists were showing up to public meetings to denounce its high costs and potential environmental impacts on Corpus Christi Bay, where it would be withdrawing massive amounts of seawater and then dumping back concentrated brine. 

More City Council members began to show interest in competing water-supply projects that other companies were pitching, even though large state loans the city had received could only be used to build a desalination plant in the Inner Harbor. 

“We’ve got to have options. It can’t just be us taking all the responsibility and absorbing it all and taking all the risk ourselves,” Hernandez said during a council meeting in 2021. 

The change in opinions reflects the risk difficulty local governments face building massive infrastructure projects. Corpus Christi’s mayor and eight City Council members all must run for re-election every two years, and bureaucrats running the city and its water department were also constantly changing. Many of the city leaders who’d championed the desalination project years earlier were gone.

The state was also standing in the way. By 2022, regulators at the Texas Commission of Environmental Quality (TCEQ) still had not signed off on permits for the project. The agency did not respond to requests for comment for this story. 

Drought Sets in and Opposition Grows

By 2023, Corpus Christi’s reservoir levels appeared on track to hit 30 percent. If that happened, City Council members could implement drought surcharges — steep fines on water usage — to compel conservation.

Murphy, of the water department, acknowledged the city had never done that before. 

“Historically speaking, it’s never happened,” he told council.

Surcharges would likely be controversial. They would increase costs for residents and small businesses, but practically all the largest industrial users wouldn’t have to pay them. Those users were paying the drought surcharge exemption fee that city leaders had put in place in 2018. 

Murphy apparently considered recommending doing away with the exemption, according to a draft version of a presentation he was set to make to City Council in January 2023. The draft, posted on the city’s website, suggested “introducing surcharges for large water users” and “removing surcharges for residential customers.” 

However, that language did not appear on slides ultimately displayed to City Council.

Murphy resigned in 2023. Now the director of water utilities for the city of Kyle, he did not respond to requests for comment. 

As drought conditions worsened, city leaders continued to discuss the possibility of surcharges for residents and businesses, but not for the industrial users. In July 2023, For the Greater Good, Araiza’s group, began circulating a petition calling for a repeal of the drought surcharge exemption fee.

“It’s residential users who face restrictions on their water usage, potentially doubled bills, and even having their water shut off,” the petition’s webpage says. “Meanwhile, large volume water users can pay a fee to opt out of these restrictions and continue using as much water as they please.”

Paulison, head of the industry trade group, attended a City Council meeting later that year to defend the companies and the plan they had come up with alongside the city half a decade earlier. 

The drought surcharge exemption fee, he said, was “misunderstood and recently much aligned.

“At the time it was adopted it was considered new and a good deal and a game changer,” he said. 

But the fee was originally meant to cover the cost of a plant that would produce 10 million gallons per day. By January 2024, city officials wanted to triple its size to keep up with industry growth and other demands. Its estimated cost by then, driven up further by rapid inflation, was $757 million. 

The city would have to spend about $68 million a year to cover debt service for such a project, officials later estimated. The money coming from the fee only averaged about $6 million a year. 

The city would need to increase water rates to help make up the difference. 

“Everyone pays for this new water supply because it’s fair, it’s right and everyone is in this together,” Drew Molly, then the head of the city’s water department, told council members during a January 2024 meeting.

He added that the city chose to build a larger plant to meet residential water demand, not just industrial demand. “The notion here that this is not for the residents is just a false narrative,” he said.

City Council approved more spending to advance the project, including $14 million for consultants and $3 million to build an electrical substation that would power the desalination plant. 

Still, opposition to the project continued to grow. At a public meeting held by state environmental regulators in April 2024, more than 100 activists marched with signs and delivered almost three hours of comments to officials. 

They called the project a “scam,” funded by the city for the benefit of wealthy corporations, and insisted that it would cause ecological damage to Corpus Christi Bay.

“We’re not going away,” Araiza said into a microphone. “We’re growing our civic engagement. You can’t stop us. The movement is building. We will win.”

Reservoir levels later dipped below 20 percent, prompting the city to intensify restrictions for residents. Lawnwatering and carwashing, two of the biggest drivers of residential water usage, were largely banned. But the city never implemented surcharges. 

As critics like Araiza had been pointing out, such fees would make little sense if industrial users were exempt. Whatever additional conservation the surcharges could achieve from residents would be minimal compared to the amount of water the industrial giants were consuming. 

“The Rubber Meets the Road Here”

A new City Council took office in 2025, dominated by skeptics of the desalination project from across the political spectrum. The new members wanted the city to evaluate the costs of other potential water sources, like drilling water wells. 

But calling off the project would mean abandoning the permits the city had worked for years to acquire, along with canceling the $757 million financing agreement with the state. 

“The decision has been made,” Paulette Guajardo, the mayor at the time, said in a May 2025 City Council meeting. “This is a decade old!”

Yet the costs kept rising. In July, the contractor the city had hired to build the plant told council members it had an estimated price tag of $1.2 billion. 

“Where are we going to get the money?” asked Vaughn. Zanoni replied that the city could seek more loans from the state. 

Guajardo urged her colleagues to move forward. 

“This is a once-in-a-lifetime project for this council,” she said. “The council before had a piece in it, and before that. The rubber meets the road here.” 

In September 2025, during a rancorous 13-hour meeting, business leaders and representatives of industrial giants warned of mass layoffs in the industrial sector if the city did not stay the course. Activists showed up in force to protest the project and rail against the big companies’ exemption from water restrictions. 

Paulison again offered testimony in their defense. 

“They contribute to the water system now, they have been investing in it for decades in most cases, and they will continue to pay their appropriate share,” he said, appearing visibly frustrated. 

But at the end of the meeting, council members dealt a major blow to the plan conceived of years earlier to help make Corpus Christi “drought proof.” They fired the contractor that was supposed to build the desalination plant. 

“We must choose options that are more affordable,” Vaughn said. 

It was  unclear whether  any such options existed. Over the next few months, as reservoir levels dwindled even further, council members approved spending more than $1 billion on seven water supply projects, most involving pumping groundwater.

At the same time, it became more expensive for Corpus Christi to borrow money after credit ratings agencies downgraded their outlooks for the city based on worries of water depletion. 

The city began laying pipes and drilling wells even before it had secured permits to operate them. The industrial users, including ExxonMobil and OxyChem, also sought permits to drill their own emergency wells, alongside the region’s school and hospital districts. 

This past summer, as the city began to prepare for an imminent “water emergency,” officials spent hours debating cutting hours at public swimming pools, which collectively consume about 20,000 gallons of water per day in the summer. 

Araiza and other activists were incensed that city officials still appeared reluctant to require cutbacks at facilities like Exxon’s plastics plant, which consumed 13.5 million gallons per day. They began collecting signatures for the Fair Water Amendment, which would repeal the drought surcharge exemption fee. They hired canvassers, bought ads in local media and knocked on doors. They gathered nearly 13,000 signatures—more than enough to qualify for November’s ballot. 

“No Resident Should Ever Have To Be Put Through This Again”

In July, epic rainstorms hit the upper Nueces River Basin, which supplies Corpus Christi’s main reservoirs. For three days, the river flowed with more water than Niagara Falls. Soon, reservoir levels had climbed past 40 percent. 

But there’s no telling how long the reservoirs will hold or when the next drought will hit, and the city’s scramble for alternative water-supply projects has had minimal success. 

In September, Corpus Christi city staff presented elected officials with a proposal for a different contractor to build the desalination plant at a slightly lower cost. They emphasized that abandoning the project altogether would also cost money. 

The city would have to return $235 million it has already borrowed from the state, $50 million of which has already been spent, along with another $70 million in interest costs. That could further damage its credit rating, making it far more difficult to get loans in the future. 

“That’s going to be a painful experience if the state of Texas calls our notes due,” said City Council member Mark Scott, who had long been a champion of the project. “I think we are dangerously close.”

Nevertheless, the council voted to reject the proposal. 

“Once again, the people are being told to carry the bill while industry stands to make the money,” said council member Eric Cantu, referring to industrial expansion that would be enabled by the new water project. “I’m not going along with it.”  

The project isn’t dead yet, its supporters insist. With water at the center of the political conversation and every seat on City Council up for election in November, supporters of the desalination project are hopeful that a new slate of city officials may have a more favorable view of the project when they take office in January. 

Zanoni said neither the city of Corpus Christi nor the state of Texas is fully equipped to handle such a project. He said the federal government needs to step in to make sure it happens by providing funding and “to demand that things get done.” 

“If America wants us to be a leader in energy production and export, and if we want this to be a great country, there has to be some intervention,” he said. 

He added, “No city manager, no city council, no resident should ever have to be put through this again.”