In echoes of the Old West, the Tesla CEO’s rocket firm has been building a company town in seaside Boca Chica, pressuring locals to sell their properties.
In autumn 2019, Celia Johnson began resisting efforts by billionaire Elon Musk’s SpaceX to buy two modest houses she owns near the company’s rocket-launch facility.
Then she discovered that a 1,600-gallon water tank had gone missing at one of her houses, a rental property. Ms. Johnson said she and her neighbors quickly concluded SpaceX workers were the culprits. SpaceX denied responsibility but reimbursed her, she said, as it did when she accused its workers of later breaking into the vacant rental house and sleeping there.
“SpaceX bullied us from the beginning,” she said. “SpaceX employees did what they wanted.”
SpaceX, the maker of rockets and spacecraft controlled by Mr. Musk, among the world’s richest people, is facing off against a handful of households that have refused to sell their properties in this remote unincorporated village. Some 30 small ranch houses sit on a sandy spit of land near the Mexican border and Gulf of Mexico beaches, where SpaceX rockets roar into the sky and then return for a landing. Some come crashing back on land.
Villagers said Mr. Musk’s company has tried multiple times to buy them out. Some took the money, and SpaceX used the homes for its workers. Holdouts, at least seven of them, said they want more from a billionaire who’s after their dream vacation homes.
Mr. Musk and SpaceX didn’t respond to requests for comment. “We’ve got a lot of land with nobody around, so if it blows up, it’s cool,” Mr. Musk said of the South Texas location at a 2018 press conference, according to media reports.
It’s hard to know exactly why SpaceX wants residents’ houses, but indications are that it would be less of a security and safety issue not to have to worry about people living so close to launches. SpaceX has also indicated, based on the company’s job postings, that it would like to develop the area into a resort.
The Texas property scuffle is beginning to echo Old West tales of outsiders who pressure residents to give up land for development—including the classic threat of eminent domain.
In March, Mr. Musk tweeted “Creating the city of Starbase, Texas,” adding that this would happen through incorporation of the town—a tactic mining companies commonly used to create company towns. If incorporation were successful, Starbase officials would have the power of eminent domain.
If incorporated, depending on what type of municipality it became, the village could have a city manager, city counselor or mayor. There are about 14 people not connected to SpaceX living in Boca Chica Village now and a few more in surrounding areas that might be included. To incorporate the village, SpaceX would need to show that more than 200 people lived in the area and to garner a majority of their votes.
They could use that power to eject holdouts, said lawyers and law professors. They would also control the police, could issue tax-free municipal bonds and might attain statutory authority over the one road in and out of the village, opening and closing it at will, these legal experts said.
Eddie Treviño, Cameron County Judge—a position akin to the top county commissioner in most states—said he discussed the possibility of incorporation with SpaceX before Mr. Musk’s tweet, but “I didn’t think much of it at the time.” Boca Chica is in the county.
Eminent domain is “an option we may need to consider,” he said. The remaining Boca Chica Village residents might need to leave for their own safety, he said: “You don’t want individuals near rocket ships being tested and landing. We don’t want anyone to get hurt.”