The Neches & Trinity Valleys Groundwater Conservation District board will meet Thursday to consider adopting new groundwater rules that would cap pumping from the Carrizo-Wilcox Aquifer, days after companies tied to Dallas investor Kyle Bass sued the district in federal court over its permitting moratorium.
The proposed rules would limit total groundwater production to the district’s state-mandated desired future conditions for the aquifer. New operating permits would be allocated based on acreage owned. The domestic-and-livestock exemption would be reduced from 36,000 to 25,000 gallons per day on tracts of at least 10 acres. Beginning in 2027, production fees would be assessed on each permit’s full authorized volume rather than the amount of water actually pumped, and contested-case hearings would be limited to applications exceeding 1,000 acre-feet annually, according to KETK.
The district, which serves much of Anderson, Cherokee and Henderson counties, adopted a moratorium on new non-exempt permit applications May 21. The moratorium remains in effect until October or until the new rules take effect, whichever is later, according to the Texas Tribune.
Redtown Ranch Holdings LLC and Pine Bliss LLC, companies tied to Bass, applied for permits to drill 43 wells that could withdraw billions of gallons of groundwater annually, according to the Tribune. On July 7, the companies sued the district in federal court in Tyler, arguing the moratorium constitutes an unconstitutional taking. The lawsuit names each board member as a defendant, according to KLTV. Bass said in a statement to the Tribune that the case is intended to protect Texas landowners’ property rights. District attorney Holli Pryor-Baze said the district disputes the allegations.
The rule revision follows a settlement of a 2025 lawsuit filed by Wayne-Sanderson Farms that prevented the district from approving certain permits until additional study of the aquifer. It also comes after legislation that would have imposed a statewide moratorium on certain groundwater export permits failed during the Legislature’s second special session in 2025.
If approved Thursday, the new rules would establish the framework for future permit applications once the moratorium is lifted, while the federal lawsuit is expected to continue. The board is also scheduled to discuss the litigation during the meeting.