What is a MUD?
A 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. It operates under the Texas Constitution and Chapters 49 and 54 of the Texas Water Code. Harris County Municipal Utility District 341 (the “District”) provides water, sanitary sewer, drainage and garbage/recycling services to customers located within it’s boundaries.
Are MUD’s common in Texas?
Yes. Texas has more than 1,200 MUD’s or special districts, many of which are located outside of city limits where there are no municipal services.
How is MUD 341 governed?
MUDs are highly regulated. MUDs are often considered to be the most regulated of all forms of local government. The Texas Commission on Environmental Quality (TCEQ) regulates MUDs and has continuing supervision over MUDs. The TCEQ has extensive rules regarding the design, construction, and financing of water, sewer, drainage and park infrastructure. MUDs are required to follow these rules.
In the late 1980’s the TCEQ rules were amended to require TCEQ review and approval of MUD bonds for financial feasibility. The “feasibility rules” impose strict tests to ensure that MUDs can support the bonds proposed to be issued. As a result, no MUD has defaulted on any MUD bonds since the implementation of the feasibility rules. Bond ratings agencies cite the TCEQ’s process of reviewing and approving MUD bonds as an important reason for favorable MUD bond ratings. In addition, a MUD must submit for TCEQ’s approval any plans and specifications for water and sewer infrastructure construction including contract documents and change orders.
Additionally, MUDs are subject to a myriad of state and federal regulations, including the Texas Open Meetings Act, Texas Public Information Act, Texas Election Code, U.S. Voting Rights Act, Texas Public Funds Investment Act, approval of bonds by the Texas Attorney General, IRS and U.S. Treasury Department regulations and other Texas laws regulating matters such as conflicts of interest and ethics.
State law also imposes strict requirements on MUD bookkeeping, auditing and financial reporting. MUDs must engage a CPA to annually audit the MUD’s fiscal accounts and records.
The day to day activities of the MUD are managed by a five-member Board of Directors that serve staggered four-year terms. To serve, a person must be eligible to vote in Texas, 18 or over, and either reside in the MUD or own real property in the MUD. Since 2018, all five directors are residents of the District. Prior to that date, non-residents held some of the Board positions. The 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 (TCEQ) and other governmental agencies.
What services does the District provide?
The District provides water, sewer and local drainage/detention services as well as solid waste (garbage)/recycling collection.
The District does not engage in the following services or have ownership in facilities that are the responsibility of the Lakes on Eldridge Community Association including:
- Recreation Amenities such as the pool, tennis courts and playgrounds
- Aesthetics or beatification
- Street ownership and street lighting
- Subdivision fencing
- Clubhouse
- Sidewalks
- Security
What facilities does MUD 341 own?
The District owns a water treatment plant including 3 water storage tanks and a water well, treatment capacity in a third party sewage treatment plant, a sewer lift station and over 31 miles of water, sewer, and storm water drainage pipes ranging in size from 4” to 66”. The MUD also owns the 9 lakes in Lakes on Eldridge and the land immediately adjacent to the lakes. Along Turkey Creek, the MUD owns the land from Lake Center Run to the Addicks Reservoir.
Why does the MUD own the lakes in Lakes on Eldridge?
The Lakes on Eldridge subdivision is known for the lakes in the community. The lakes are certainly an attractive feature, but underneath the beauty, they serve a critical purpose. The lakes are a primary feature of our local storm water drainage system. When it rains, water flows from our streets into an underground system of piping. This piping flows into the various lakes. From the lakes, the water flows into Turkey Creek and ultimately into Addicks Reservoir. From a technical perspective, it would be better for the lakes to be empty so they could absorb the maximum rainfall. However, that wouldn’t be very attractive. Since community beauty is the responsibility of the Lakes on Eldridge Community Association, it maintains the lakes as well as the land surrounding the lakes and lake levels for the enjoyment of all residents.
How is the District funded?
All MUD’s are funded through 2 primary mechanisms – monthly water/sewer bills and annual MUD taxes. The largest component of the water/sewer monthly bill is for the water used. This is primarily just a pass through cost from the West Harris County Regional Water Authority (WHCRWA). You can learn more about them at https://www.whcrwa.com. The water/sewer bill revenue is used to pay for operational costs. MUD taxes are based on property values much like school taxes or county property taxes. This tax revenue is also used for operational costs and for interest/principle payments to MUD bond holders.
Could I attend a District Board Meeting?
Absolutely! The meetings are normally held at noon on the 2nd Monday of each month at the law offices of Schwartz, Page & Harding, L.L.P. The meetings are held in this location, because all MUDs use many contractors/consultants. Often, the same consultants are used by multiple MUDs. In the case of MUD 341, the same consultants serve several MUDs that meet back to back on the 2nd Monday at the attorney’s office. By reducing consultant travel time, the District saves money. It is less convenient for the Board members, but economically better for our customers.