In Westlake, the Data Center Fight Is Really About a 1998 Zoning Map

On Friday, October 23, a Tarrant County judge is scheduled to decide whether a group of Keller homeowners has standing to continue its lawsuit against Westlake over the proposed Circle T Data Center. The hearing will settle a legal question about process. The bigger question, whether a data center can go on that land at all, was settled long before anyone filed suit. Westlake says the answer was written into its zoning in 1998.

Anyone comparing homes in Westlake, Keller, Southlake or Trophy Club can learn from this case. A listing shows the house. The zoning map shows what is allowed next door, and the map that controls a property line may belong to a different city.

What Westlake's council can and cannot vote on

The site is an approximately 87.96-acre tract at the northeast corner of U.S. 377 and Westport Parkway, at Westlake's southern edge beside Keller. The proposed development agreement names Circle T Owner, LP as the Town's counterparty. Community Impact identified the developer as PowerHouse Data Centers.

The land sits in Planned Development District 3-8, and under PD-3-8 a data center is already a permitted use. In its explainer, The Truth About Westlake's Data Center, the Town says the Planning and Zoning Commission could only check whether the site plan met adopted standards. It also says the Town Council "will not vote on whether a data center should be on that land; that's already been established." What the council votes on is a development agreement: a legally binding document that runs with the land and governs infrastructure, architecture and landscaping. The Town's position is that once the application was accepted, the council had no authority to deny the use.

How a 1998 map met a 2015 subdivision

According to the Town, the land on each side of the fence line changed in this order:

1. 1998: The Westlake parcel is zoned for commercial and industrial use, and the Town says that zoning has not changed in 28 years.
2. 2006: Keller's city council rezones the land that became the Marshall Ridge neighborhood from commercial to residential through Ordinance 1309.
3. 2015: Keller approves Ordinance 1742, which changes more industrial-commercial land to residential and adds 15 homes directly along the fence line of the Westlake parcel.
4. December 10, 2024, and January 6, 2025: Westlake's Planning and Zoning Commission recommends development-performance standards, and the Town Council approves related text amendments, according to the City of Keller's published timeline.
5. August 4, 2026: Westlake's Planning and Zoning Commission approves the site plan with three conditions.

Westlake's argument rests on the first three steps. In its view, the homes came to the industrial land. In its own words, "many would have preferred the land to remain a pasture, that was not a realistic long-term expectation." The Town also explains why the project cannot move farther north on Highway 377: the owner holds no other site in Westlake, and this location has highway access and the electrical infrastructure the project needs.

The plaintiffs focus on the fourth step. They allege that notice for the December 2024 planning action and the January 2025 council action was legally inadequate, as the Fort Worth Star-Telegram reported. According to CBS News Texas, the plaintiffs say the December 2024 agenda did not include the words "data center." They also allege that the site plan leaves out a 150-foot setback and landscaped buffer required between the facility and their homes. These are a litigant's allegations, not court findings.

The revenue and the fence line sit in different cities

The financial incentives explain why this fight is so hard to settle.

Westlake estimates the project would bring in about $5 million a year for its first 10 years and $7 million a year after that. The Town projects that as a 14% increase in its revenue. Those are the Town's own projections, and the money goes to Westlake.

Most of the physical closeness falls in Keller. Community Impact reported that the building footprint on the site plan is 506 feet from the property line next to homes on Llano Court. Westlake says its nearest resident is more than 1,200 yards away. The immediate neighbor is Keller's Marshall Ridge, including the Lakes at Marshall Ridge HOA area. Marshall Ridge Point and Center Stage are other nearby Keller developments.

The people who filed suit match that split. The Lakes at Marshall Ridge Homeowners Association and two individuals sued Westlake's mayor and council members, and the City of Keller joined as an intervenor. The plaintiffs have raised concerns about property values and quality of life. The Dallas Morning News pointed to the wider pattern in a related piece about Texas neighbors outside a city or county line who feel powerless over data centers built just past it.

What the agreement would put in writing

The development agreement is the one document Westlake's council can still shape, so its terms matter to the neighbors. These are the figures the Town and the developer have presented. None of them is from a final, executed agreement.

The two water figures measure different things. The Town's annual total covers a year in which the cooling system runs without water about 85% of the time. The peak figure describes the hottest days, which is why the Town FAQ says the site must keep 1.5 million gallons of water stored on site. Sources also give slightly different acreage: 87.96 acres in the agenda, 87.9 in the Town FAQ, and a roughly 90-acre complex in the developer's presentation.

A state layer sits on top of the local agreement. Governor Abbott's office announced standards that require data-center projects to submit information on power demand, water use, neighborhood impacts and ownership to the PUCT and ERCOT for audit. Westlake's FAQ says its agreement would require that audit to be finished before a building permit is issued.

Where the case stands this week

The court has controlled the timeline since August. Judge Kimberly Fitzpatrick issued a temporary restraining order on August 17, a few hours before a Westlake Town Council meeting, and the council tabled its vote. The order was extended several times and then dissolved at a September 25 hearing. The Dallas Morning News reported that the next step is the October 23 hearing on standing. Dissolving the order did not decide the lawsuit on its merits.

The two sides read the hearing differently. In a statement to the Dallas Morning News, Westlake said it is "confident the entire dispute will be fully resolved during the upcoming October 23rd hearing." The plaintiffs' attorney told the same paper he disagrees. The Town has said it will announce the date of its next data-center meeting through its own channels.

Reading the map beside any home on a town line

Westlake, Keller, Southlake, Trophy Club and Fort Worth meet along boundaries that are easy to cross without noticing, and Westlake itself sits in both Tarrant and Denton counties. For a home with open land behind it, Circle T gives a buyer a useful order of questions:

• Which city controls the open land? It may not be the city on the buyer's tax bill.
• What is the land zoned for today, and since when? On the Westlake parcel, the 1998 zoning mattered more than any later public meeting.
• Is it a planned development district? Under PD-3-8, the uses were set in advance, so later votes covered only how the project would be built.
• Who would collect the revenue from whatever gets built? That city has the stronger incentive to see it finished.

The zoning on a neighboring city's land is a public record kept by that city. Builders and lot buyers treat it as part of a site's value, and resale buyers on a town line can read it the same way. Zoning, notice requirements and pending litigation are legal matters, so this post is general information and not legal advice. Anyone evaluating a specific property should confirm the details with a real estate attorney and the city's planning department.

FAQ

Can Westlake's council still stop the data center? By the Town's account, no. Westlake says the use is permitted by right under PD-3-8 and that the council votes only on the development agreement. The plaintiffs are challenging the notice and process behind earlier approvals, and the court has not ruled on the merits.

Will Westlake water bills go up because of the project? The Town's FAQ says they will not. It says the developer is paying to raise pump-station capacity and that water from the City of Fort Worth through the Tarrant Regional Water District is enough for both the town and the project.

What happens after the October 23 hearing? The judge is scheduled to decide whether the plaintiffs have standing to continue the case. Westlake has said it will announce its next data-center meeting once it is scheduled.

Looking at a lot or a home with open land beside it in Westlake or a neighboring town? We can pull up the zoning on that land with you before you write an offer. With construction and lot experience through Atwood Custom Homes, Trisha Atwood reads what can go up next door as part of a property's value. Let's Connect.