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Home Politics Harris County

The wild world of developers and MUD’s

A staggering amount of bond debt is created by developers and it takes very few voters to approve it.

by David Jennings
November 7, 2019
in Harris County
7
The wild world of developers and MUD’s

Each election I’m fascinated by the amount of bond debt created across Harris County and Texas by land developers using municipal utility districts and that a single voter can approve the debt. According to a 2015 study by Rice’s Kinder Institute, the total amount of Houston MUD debt was $5.8 billion. And yes, sometimes they do go bankrupt.

I decided to look at several Harris County MUD elections from Tuesday. Here is a link to view all the MUD’s in Texas – Water Districts Viewer. Election results here, ballot language here.

Harris County MUD 25

  • Number of registered voters – 1
  • Number of ballots cast – 1
  • Prop A The issuance of bonds in the maximum amount of $15,700,000
  • Prop B The levy of an ad valorem tax for maintenance purposes

Harris County MUD 518

  • Number of registered voters – 1
  • Number of ballots cast – 2
  • Prop B The issuance of $185,000,000 bonds for water, sanitary sewer, and drainage and storm sewer systems and the levy of taxes, without limit as to rate or amount, in payment of the bonds
  • Prop C The issuance of $46,200,000 bonds for recreational facilities and the levy of taxes, without limit as to rate or amount, in payment of the bonds
  • Prop D An operation and maintenance tax for facilities authorized by article xvi, section 59, of the Texas constitution, not to exceed one dollar and fifty cents ($1.50) per one hundred dollars ($100) valuation of taxable property
  • TCEQ shows as INACTIVE.

Harris County MUD 540

  • Number of registered voters – 0
  • Number of ballots cast – 2
  • Prop B The issuance of $215,000,000 bonds for water, sanitary sewer, and drainage and storm sewer systems and the levy of taxes, without limit as to rate or amount, in payment of the bonds
  • Prop C The issuance of $30,000,000 bonds for recreational facilities and the levy of taxes, without limit as to rate or amount, in payment of the bonds
  • Prop D The issuance of $35,000,000 bonds for roads and the levy of taxes, without limit as to rate or amount, in payment of the bonds
  • Prop E An operation and maintenance tax for facilities authorized by article xvi, section 59, of the Texas constitution, not to exceed one dollar and fifty cents ($1.50) per one hundred dollars ($100) valuation of taxable property
  • Prop F An operation and maintenance tax for road facilities authorized by article iii, section 52, of the Texas constitution, not to exceed twenty-five cents ($0.25) per one hundred dollars ($100) valuation of taxable property

Harris County MUD 565

  • Number of registered voters – 2
  • Number of ballots cast – 2
  • Prop B The issuance of $255,810,000 in bonds and the issuance of $102,325,000 in refunding bonds and the levy of ad valorem taxes in payment of the bonds (water, sanitary sewer, drainage and storm sewer, organization and administration)
  • Prop C The issuance of $40,000,000 in bonds and the issuance of $16,000,000 in refunding bonds and the levy of ad valorem taxes in payment of the bonds (macadamized, graveled, or paved roads and turnpikes, or improvements)
  • Prop D The issuance of $20,410,000 in bonds and the issuance of $8,165,000 in refunding bonds and the levy of ad valorem taxes in payment of the bonds (park and recreational facilities
  • Prop E The levy of a maintenance tax not to exceed one dollar and fifty cents ($1.50) per one hundred dollars ($100.00) of assessed valuation (water, sanitary sewer, drainage and storm sewer, organization and administration)
  • Prop F The levy of a maintenance tax not to exceed one dollar and fifty cents ($1.50) per one hundred dollars ($100.00) of assessed valuation (macadamized, graveled, or paved roads and turnpikes, or improvements)
  • Prop G The levy of a maintenance tax not to exceed ten cents ($0.10) per one hundred dollars ($100) of assessed valuation (park and recreational facilities)
  • Created last legislative session by bill HB 1379 by Oliverson and Bettencourt.

That last one was created this year. If you click the link above, you can see how these things get created.

That’s a boatload of debt, here’s to hoping that they are successful. I’d think carefully before moving into a MUD.

If you don’t want to read that Kinder Report, here is a quick overview of MUDs.

Now, about those votes. Hmm. How does an entity with zero registered voters accept 2 ballots? Or an entity with 1 registered voter accept 2 ballots? Makes you wonder what is really going on at the County Clerk’s office. After all, if it takes them 12 hours to count the votes, are they just as incompetent in making certain only registered voters vote?

David Jennings

David Jennings

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It's Okay to Say Retarded

Comments 7

  1. Gail Stanart says:
    4 weeks ago

    I understand that these developers move someone or a couple in on the land in a mobile home/trailer in orer to get this done. I wonder if they actually moved their voting location. Years ago, there was one in Montgomery County that got quite a bit of notoriety because of who was on the required to pay off the loans. I wonder if anyone can remember that debacle and knows how it eventually turned out.

    3
    Reply
    • Adrian Heath says:
      4 weeks ago

      Its continues unabated. Gail should know the Texas Secretary of State referred complaints to the AG who has failed to investigate claims that developers are violating Texas Bribery statutes by offering low rent etc in exchange for a vote. The developers are so emboldened they are recycling voters and using them up to three time in a row. https://mctxonline.com/blog/2019/05/09/rentvoter-bribery-complaint-reveals-3-time-voters-used/

      1
      Reply
  2. David Wilson says:
    4 weeks ago

    Special Purpose Districts, such as MUDs and WCIDs were put forth by the Texas legislature as an alternative way to finance infrastructure needs to new developments rather than the developer rolling these costs into the lot home cost to the end consumer, the taxpayer. As with any new government program, it expands beyond what was originally intended. Before you decide whether or not Special Purpose Districts are good are bad, (and both exist), I found that this report was not TOO long and provides a good background on how we got to where we are today:

    https://repositories.lib.utexas.edu/bitstream/handle/2152/46110/HOWELL-MASTERSREPORT-2016.pdf?sequence=1&isAllowed=y

    2
    Reply
    • Adrian Heath says:
      4 weeks ago

      David, there are two major problems underlying the proliferation of MUDs. First, the use of transient voters with no connection to the community under development setting tax rates they will never be responsible to pay and approving massive amounts of bonds in advance of the taxpayers who will owe them.

      Second an more importantly, the willingness of developers to use measures to recruit voters that would, in any other setting be denounced for the corruption it is. e.g. advertising low rent on craigslist in exchange for ability to vote. The Texas SOS released data via open records showing 129 voters in 18 Houston are counties all using the same mailing address in Spring TX. Here is a single example of improper inducement to vote ~ https://mctxonline.com/blog/2016/09/20/emcid-cuts-out-rent-a-voter-middleman/

      1
      Reply
  3. lois Myers says:
    4 weeks ago

    Investigate the MUD for Developer Metro National’s Old Pine Crest Golf Course at Clay & Gessner, Zipcode 77080. It will be quite a ride. They said 2 men were living in a Trailer back from the road quite a ways, but a Trespassing Sign was put up to keep folks off the property so it couldn’t be investigated when the MUD was on the Ballot for a vote by 2 or 3 people.

    1
    Reply
    • Don Sumners says:
      4 weeks ago

      Refering to the Montgomery County insident, as I recall a couple of persons who tried to defeat the vote in Montgomery County by registering and voting in the Mud District area were prosecuted by the Montgomery County DA for fraudulent voting. I think they may have gotten jail time.

      Reply
  4. Ross says:
    3 weeks ago

    There are advantages th o the MUD model. You can choose not to live in a MUD and thus never be subject to the taxes to pay the bonds. Existing county or city residents don’t pay higher taxes for infrastructure in new developments. Bondholders take all the risk of failure to pay the bonds, not the general taxpaying population.

    I’m not seeing any real negatives here, other than the high taxes on people who buy in the MUD, but that’s something they should have looked into before buying.

    2
    1
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