Real estate
BY GRANT CRAWFORD
As the population of Texas continues to grow— having now passed 30 million people, according to recent U.S. Census Bureau data—housing communities constructed outside the jurisdiction of existing city or county governments require developers to find alternative solutions to provide residents with key infrastructure to support a subdivision. This solution often comes in the form of a municipal utility district, or MUD. To provide core services for communities, MUDs may issue bonds to reimburse a developer, repaying the debt using property tax revenues and user fees received from utility services, said Amy Giannini, district engineer for Brushy Creek MUD in the Round Rock area. “In addition to other user fees, MUDs use these revenue and financing sources to operate, maintain and improve infrastructure services throughout the district,” Giannini said. MUDs now routine fix for developers
The framework
within 120 days, developers can petition the TCEQ to form a MUD. Voters who live in the proposed district must also give their approval. MUDs are governed by a board of directors, made up of property owners who are elected. Giannini said the Brushy Creek MUD board includes five residents. “At BCMUD, there are also several resident advisory committees that meet regularly to discuss issues pertaining to district infrastructure and operations,” Giannini said.
A MUD is a type of special district allowed under state law that functions as an independent, limited government, Giannini said. According to state law, developers can petition the Texas Legislature or the Texas Commission on Environmental Quality to create a MUD. If the land where developers want to establish a MUD falls within a city’s jurisdiction, the city must provide consent to create the MUD. Developers are able to negotiate terms with a city, but if the parties can’t come to an agreement
Number of special-purpose districts by county Special-purpose districts can include MUDs, water conservation districts, emergency services districts and others to provide residents with key infrastructure and resources.
What else?
A variety of limited government districts can be created throughout the state. In Texas, thousands of special-purpose districts are set up to provide a wide range of services, according to the Texas Comptroller of Public Accounts. These can include emergency services, library, crime control, development, fire control and health services districts. Similar to MUDs, these districts may also impose property tax, sales tax or user fees, depending on the services they provide. In 2017, a state law was passed to improve transparency, requiring certain special districts to provide records annually regarding district finances and tax rates to the Comptroller. More information about special district finance reports can be found by visiting www.comptroller.texas.gov.
Williamson County
97
Services provided by MUDs
Travis County
113
Water supply
Wastewater treatment
Bexar County 24
Solid waste management
Drainage systems
Hays County
44
Parks and recreation facilities
Roads
Dallas County
40
SOURCE: TEXAS COMPTROLLER OF PUBLIC ACCOUNTS/COMMUNITY IMPACT
SOURCE: CITY OF AUSTIN/COMMUNITY IMPACT
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