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What is a developer's responsibility to MUDs?ĭevelopers must petition the Texas Commission of Environmental Quality to create a MUD. A MUD can provide for itself the recreational amenities that are approved by the Board of Directors and funded by the District. In addition to their common functions of water and wastewater service, MUDs are legally empowered to engage in conservation, irrigation, electrical generation, firefighting, solid waste collection and disposal, and recreational activities (such as parks, swimming pools, and sports courts). How do MUDs provide for parks, pools and recreation facilities? MUD rates generally decline over time as the MUD is built out and operating and debt service costs are shared by more homeowners. MUD tax rates, like all property tax rates, vary according to property values and debt requirements. As the debt decreases, MUD taxes may also decrease over time. Homeowners then pay off those bonds through MUD tax. Municipal Utility Districts are funded through bonds. A MUD may adopt and enforce all necessary charges, fees, and taxes in order to provide district facilities and service. The Board establishes policies in the interest of its residents and utility customers. The publicly elected Board of Directors manages and controls all of the affairs of the MUD subject to the continuing supervision of the Texas Commission of Environmental Quality. Let us help you every step of the way, from the initial consultation to closing and everything in between.Īustin San Antonio Central Texas How does a MUD work?
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Thinking about buying a home in Austin, San Antonio, or other parts of Central Texas? Let the award-winning team at JBGoodwin guide you through the process. After approval, the TCEQ appoints five temporary members to the MUD's Board of Directors, until an election is called to elect permanent Board members, to confirm the MUD's creation, and to authorize bonds and taxing authority for bond repayment. The TCEQ evaluates the petition, holds a public hearing, and grants or denies the petition. How is a MUD created?Ī majority of property owners in the proposed district petitions the Texas Commission of Environmental Quality to create a MUD. Overall, Texas has more than 1,200 special districts, many of which are located outside of city limits where there are no municipal services. MUDs vary in size, but they generally serve master-planned communities of a few hundred households. Homes in Shady Hollow, Belvedere, Anderson Mill, and the Ranch at Cypress Creek in Austin are all communities with their own MUD, just to name a few. < Back to Homebuyers Guide What You Need To Know About Municipal Utility Districts (MUD) What is a MUD (Municipal Utility District)?Ī Municipal Utility District (MUD) is a political subdivision of the State of Texas authorized by the Texas Commission of Environmental Quality (TCEQ) to provide water, sewage, drainage and other utility-related services within the MUD boundaries.