Texas MUDs, PIDs and special districts: how to read the bill and the closing disclosure

Summary

A Texas tax statement is rarely one line. Beyond the county, the school district and any city, a home can sit inside a municipal utility district, a water control and improvement district, an emergency services district, a hospital district or a public improvement district. Each of these is a separate public body with its own board, its own rules and, in most cases, its own charge. Some levy a property tax at a published rate. A public improvement district instead levies an assessment, which behaves differently and is disclosed in different paperwork. For a retiree comparing a new master-planned community with an older neighborhood, these lines can matter as much as the headline city or county rate.

This guide explains what each kind of district is according to the Texas Commission on Environmental Quality (TCEQ) and the Texas statutes, how the districts show up on a bill and on appraisal-district rate tables, what the statutory notice to buyers in a utility district says, and where to find a specific district's information. It then works through published examples from Williamson, Kendall, Collin, Bastrop, Tarrant and Hood counties, each with its tax year, so the differences are concrete. Rates and fees change every budget year, and figures from different years are not like-for-like, so confirm current figures with the appraisal district, the district itself and the seller's disclosures before relying on any number here. For the wider property tax cycle see Texas property taxes and appraisal districts, and for association charges that sit outside the tax system see HOA, condo, club and special assessment fees.

Key takeaways

• A MUD, WCID, emergency services district or hospital district usually appears as its own taxing unit with a rate per $100 of value, split into a maintenance part and a debt-service part; a PID usually appears as an assessment with a lien rather than a rate.
• Two homes with the same appraised value can differ widely: in our illustration, each 1.00 of extra combined rate per $100 adds about $3,000 a year on a $300,000 taxable value, so compare the full stack of taxing units for the tax year, not the city rate alone.
• Water Code Section 49.452 requires a seller in a covered utility district to give the buyer a written notice before the contract is signed and a recorded copy at closing; Property Code Section 5.014 requires a separate notice for PID assessments.
• TCEQ's Water Districts Map and database, the district's own notice of tax rate and audit, and the county clerk's filed information form are the primary places to check a district.
• A district called a MUD may supply water and sewer service without a current tax line, as the Hood Central Appraisal District tables show for Acton MUD from 2023 through 2026, so check both the utility bill and the tax statement.

The kinds of districts a Texas buyer meets

The Texas Comptroller reports that more than 4,796 local taxing units in Texas, including school districts, cities, counties and various special districts, assess property tax. The special districts are the ones that vary most from one address to the next, because they are created for a particular purpose and cover only part of a county.

TCEQ describes a water district as a local governmental entity that provides limited services to its customers and residents, and lists municipal utility districts, water control and improvement districts, special utility districts and river authorities as examples. Its general guide (publication GI-043, revised October 2019) says municipal utility districts, or MUDs, provide water, wastewater, drainage and other services within the district's boundaries, and that the other services can include water conservation, irrigation, firefighting, solid-waste collection and recreational facilities. It adds that in certain counties MUDs may levy taxes to pay for recreational facilities and set and charge user fees. Chapter 54 of the Water Code, the chapter on municipal utility districts, lists purposes that include the control, storage, preservation and distribution of storm water and floodwater, the reclamation and drainage of overflowed land, and the protection of the purity and sanitary condition of water.

According to the same TCEQ guide, water control and improvement districts, or WCIDs, have broad authority to supply and store water for domestic, commercial and industrial use, operate sanitary wastewater systems, and provide irrigation, drainage and water-quality services. Special utility districts provide water, wastewater and firefighting services but cannot levy taxes. That last point is useful when reading a bill: a utility district that cannot tax will not appear as a taxing unit even though it may send a monthly utility invoice.

An emergency services district is a different animal. Chapter 775 of the Health and Safety Code says an emergency services district may be organized as provided by Article III, Section 48-e of the Texas Constitution and by the chapter, to protect life and health, and that it is a political subdivision of the state. The chapter directs the board to impose an ad valorem tax annually on all real and personal property in the district, and it also lets a district adopt a sales and use tax, at a rate from one-eighth of one percent to two percent, at an election. The chapter describes the services as including fire control and emergency medical and ambulance services, and the district's rate then appears as its own line on the tax statement of every property inside it.

A hospital district is created for health care rather than infrastructure. Chapter 281 of the Health and Safety Code covers hospital districts in counties of at least 190,000 inhabitants. It allows such a county to create a countywide hospital district to furnish medical aid and hospital care to indigent and needy persons residing in the district, requires a majority of the county's voters at an election to create it, and provides that once taxes are collected for the district it assumes full responsibility for that care. For a homeowner it appears as one more taxing unit, even though the benefit is a safety-net hospital system rather than a service delivered to the lot.

A public improvement district, or PID, is created by a city or county rather than by TCEQ. Chapter 372 of the Local Government Code is titled the Public Improvement District Assessment Act. It says that if the governing body of a municipality or county finds that it promotes the interests of the municipality or county, it may undertake an improvement project that confers a special benefit on a definable part of the municipality, the county or the municipality's extraterritorial jurisdiction. The authorized projects include landscaping, streets and sidewalks, parks, water, wastewater and drainage facilities, and special supplemental services such as security and promotion. The cost is assessed against the property that benefits, which is why a PID is usually described as an assessment district rather than a tax rate.

How districts appear on a tax statement and a rate table

Districts that levy a property tax appear as separate taxing units, each with its own rate. Texas property tax rates are expressed per $100 of value; the statutory district notice, for example, states the current rate of the district property tax on each $100 of assessed valuation, and Tarrant Appraisal District titles its table tax rates per $100 valuation. A district's total rate is usually the sum of two parts. TCEQ explains that, with voter approval, a district may levy a maintenance tax to cover the cost of operating and maintaining its water and sanitary sewer system, and that districts may also seek voter authorization to issue unlimited tax bonds, in which case the board must levy an annual property tax sufficient to cover the district's outstanding debt. Appraisal-district tables label these parts maintenance and operations (M&O) and interest and sinking fund (I&S).

TCEQ stresses one point that surprises many buyers. The debt-service tax is levied on all property in the district based on appraised value, regardless of the services each landowner receives. A resident who uses little water pays the same debt-service rate per $100 of value as a neighbor who uses a great deal, and a higher-valued home pays more. The same guide says a lot owner cannot withdraw from a district that has issued tax bonds, even if those bonds have since been paid off, and that a landowner who pays district taxes is not guaranteed service, because a connection charge and the cost of extending lines can be owed in addition.

PIDs show up differently. The Williamson County tax office's 2024 table lists several public improvement districts by name and carries a footnote stating that a Public Improvement District is an assessment set by the district. Most of them show a rate of 0.000000 with a three-asterisk mark and no exemption entry, which signals that the amount owed is not computed from a rate in that table. Georgetown Village PID is the exception in that table, listed at 0.120000. The Bastrop Central Appraisal District's list of taxing units likewise includes Hunters Crossing Public Improvement District entries separated by property class, including single family flat, multi-family and commercial. The lesson is that a PID may or may not show up as a rate, so the bill, the PID's service plan and the seller's notice are the places to find the real obligation.

Published examples, with their tax years

Collin Central Appraisal District, 2026. The district's 2026 tax rates and exemptions table lists 29 municipal utility districts and gives each a maintenance and operations rate, an interest and sinking fund rate and a total. Collin County MUD #04 is listed at 0.12 and 0.88 for a total of 1.0, Blue Meadow MUD #3 at 0.55 and 0.45 for a total of 1.0, Uptown MUD #1 at 0.075 and 0.725 for a total of 0.8, and Bainbridge MUD at 1.2 with no debt-service component. For scale, the same table lists Collin County at a total of 0.151414 and the City of Frisco at 0.425517. The table also shows McKinney MUD #1 and #2 and Collin County MUD #01 without any rate figures, and names Utility Tax Service LLC rather than the county tax office as the collector for them, a reminder that even an appraisal-district table does not always carry every district's rate. See McKinney and Frisco for the cities, and note that this is a 2026 table.

Williamson County tax office, 2024. The 2024 table of tax rates by jurisdiction lists many MUDs, for example Wells Branch at 0.240000, Williamson County #35 at 0.950000 and Leander #1 at 1.000000, alongside Brushy Creek MUD Defined Area at 0.100000. It also lists twelve Williamson County emergency services districts, such as ESD #8-Georgetown at 0.096817. The table's Georgetown Village PID line, at 0.120000, comes with the footnote that a PID is an assessment set by the district. Whether a particular Georgetown address pays any of these depends on its location. The Sun City Texas community's own materials mention no such district, and the county table lists none named for it, which is why the Georgetown and Sun City Texas pages tell buyers to check the tax statement for the specific lot.

Kendall Appraisal District, 2026. Kendall County MUD #1 has an adopted 2026 rate of 0.65, the same figure listed for 2025, 2024 and 2023, with 0.6389 shown for 2022. Miralomas MUD is listed at 1.00 for 2026. These districts sit beside the City of Boerne at 0.479, Kendall County at 0.373 and Boerne ISD at 1.0065. See Boerne. The next section uses the appraisal district's own combined-rate sheet for this county.

Texas Comptroller, 2025, Bastrop County. The Comptroller's 2025 special-district report, in the version dated January 28, 2026, lists The Colony MUD #1E at a total of 0.665 (0.29 maintenance and 0.375 debt service), The Colony MUD #1A at 0.85 (0.375 and 0.475), The Colony MUD #1D at 0.85 (0.2 and 0.65) and The Colony MUD #1F at 0.85 (0.85 and nothing for debt service). Bastrop Central Appraisal District's list of taxing units names The Colony Municipal Utility Districts 1A through 1G separately, so two homes in different sections of the same master plan can sit in different districts. The Colony is the setting for Del Webb Austin at Lost Pines; see Bastrop for the surrounding tax picture.

Tarrant Appraisal District, 2025. The district's 2025 table of rates per $100 of valuation lists Live Oak Creek MUD at 0.9420000, Far North Fort Worth MUD #1 at 1.0000000 and Trophy Club MUD #1 at 0.0681400. It lists Viridian Mgmt District at 0.5152000 and Karis Mgmt District at 0.4600000, and it lists Tarrant County Hospital at 0.1650000 and an Emergency Services Dist at 0.0743480, which shows the hospital and emergency-service layers in the same table. The City of Mansfield's property tax page names the Staybolt Public Improvement District and the South Pointe Public Improvement District. See Fort Worth and Mansfield.

Hood Central Appraisal District and Acton MUD. Acton Municipal Utility District says it was created in 1982 to serve the Acton area, DeCordova Bend Estates, Indian Harbor and Pecan Plantation. It says it provides water to all district members and sewer to members in DeCordova Bend Estates, parts of Pecan Plantation and the Acton area, and serves approximately 8,900 households. Hood CAD's 2022 table listed Acton MUD at 0.0200000, but the district's 2023 through 2026 tables do not list it as a taxing unit, while the 2026 table does list Cresson MUD and Cresson Crossroad MUD 2 at 1.0000000 each. The Pecan Plantation land-sales site's FAQ says the community carries no MUD or PID taxes. Taken together, the lesson is that a district called a MUD can be the supplier of water and sewer service that bills monthly, without a current property-tax line, and a buyer should check both the utility bill and the tax statement. See Pecan Plantation and DeCordova Bend Estates.

Why two houses with the same appraised value can have very different bills

The appraisal district sets one number, the appraised value, and each taxing unit then applies its own rate and its own exemptions to it. Two homes with identical appraisals can therefore differ because one sits in a district the other does not, because the two sit in different school districts, or because one lies inside a city and the other outside it. Kendall Appraisal District publishes the effect directly. Its 2026 adopted-rates sheet shows combined rates for the unit combinations that exist in the county. A parcel in the City of Boerne, Kendall County, Boerne ISD and Cow Creek has a combined rate of 1.8635. The same combination without the city, for a parcel outside city limits, is 1.3845. Add Kendall County MUD #1 and the combined rate becomes 2.0345, and with Miralomas MUD in place of that district it becomes 2.3845.

For example, taking a taxable value of $300,000 as an illustration and ignoring exemptions that differ by unit, each 1.00 per $100 of rate equals $3,000 a year, so the gap between a combined rate of 1.3845 and one of 2.3845 is about $3,000 a year on that value. This is our arithmetic, not a bill, and exemptions such as the $140,000 school-district homestead exemption change the taxable value that each unit applies its rate to; see the guide to homestead and age-65 exemptions. The point is the order of magnitude: a special district can add as much to a bill as a county does.

A second cause is timing inside a district's life. A new district with large voter-approved bonds and few homes can carry a high debt-service rate while it builds out, and the rate can change as more homes are added and as bonds are issued or refinanced. TCEQ notes that districts must publish a notice of the tax rate before setting or changing rates and must hold a public hearing if there is to be an increase in the effective tax rate. The rate on today's sheet is therefore a snapshot, which is why the Comptroller's per-county reports, the appraisal district's tables and the district's own notice should each be dated whenever they are quoted. For the practical question of new homes, see the guide to new construction versus resale.

Tax rate versus PID assessment

A tax rate and an assessment are not the same thing. A tax rate is applied to the taxable value of the property, so it moves with appraisals and exemptions. A PID assessment is the property's share of the cost of an improvement or service. Section 372.015 of the Local Government Code says the governing body shall apportion the cost on the basis of special benefits accruing to the property, and allows the cost to be assessed equally per front foot or square foot, according to the value of the property, or in any other manner that imposes equal shares on property similarly benefitted. The amount for each owner may be adjusted after the annual review of the service plan.

The assessment carries a lien. Section 372.018 says an assessment, with interest, collection expense and reasonable attorney's fees, is a first and prior lien against the property assessed, superior to all other liens and claims except liens for state, county, school district or municipality ad valorem taxes, and a personal liability of the owners of the property. The lien runs with the land. An assessment bears interest at the rate specified by the governing body, and when bonds or notes finance the improvement the interest rate may not exceed a rate one-half of one percent higher than the actual interest rate paid on the debt. In practical terms, a buyer inherits both the remaining balance and the annual installment.

Property Code Section 5.014 requires a seller of property in a public improvement district established under Chapter 372 or Chapter 382 of the Local Government Code to give the buyer a written notice headed Notice of Obligation to Pay Improvement District Assessment. The prescribed text says that the buyer is obligated to pay assessments for the costs of a portion of a public improvement or services project, that the assessment may be paid in full at any time, and that if it is not paid in full it will be due in annual installments that vary from year to year depending on interest, collection costs, administrative costs and delinquency costs. It states that the exact amount of each annual installment will be approved each year by the city council or county commissioners court in the annual service plan update, and that failure to pay may result in penalties and interest or in a lien on and the foreclosure of the property. Under Section 5.0141 the notice is to be given before a binding contract is signed; if it was not, the buyer may terminate for any reason not later than the seventh day after receiving the notice, but only if the municipality or county filed a copy of the service plan with the county clerk before the contract was entered into. Section 5.0143 requires a separate copy to be signed at closing and recorded in the deed records of the county.

The statutory notice to buyers in a utility district

Water Code Section 49.452 sets out a separate notice for many utility districts. As the text states, a person who proposes to sell or convey real property in a covered district must give the purchaser a written notice, and the section lists transfers to which it does not apply, including foreclosures, transfers by deed in cancellation of secured debt, transfers by will or probate, and transfers to a governmental entity. A covered district is one governed by Chapter 375 of the Local Government Code, or one created under the Water Code title or by special act that provides water, sanitary sewer, drainage and flood control or protection facilities or services as its principal function, financed or proposed to be financed with district bonds payable from district taxes or a standby fee, and that includes less than all the territory in at least one county and, inside a city, less than 75 percent of the incorporated area. The exact definition matters, so a seller or title company should confirm that a particular district is covered.

The timing rule is specific. The notice must be given to the prospective purchaser before execution of a binding contract of sale, either separately or as an addendum or paragraph of the purchase contract. If a contract is signed without it, the purchaser is entitled to terminate. If the seller furnishes the notice at or before closing and the purchaser elects to close anyway, it is conclusively presumed that the purchaser has waived the right to terminate and to recover damages or other remedies under the section. The purchaser must sign the notice or the contract that includes it, and at closing a separate copy with current information must be executed by the seller and purchaser, acknowledged and recorded in the deed records of the county where the property lies.

The content is prescribed in Section 49.4521. The notice must carry a title caption in at least a 24-point bold font reading NOTICE TO PURCHASER OF SPECIAL TAXING OR ASSESSMENT DISTRICT, and it must state, as applicable, that the property is located in the named district and may be subject to district taxes or assessments, that the district may with voter approval impose taxes and issue bonds and may impose an unlimited rate of tax to pay those bonds, and either the current rate of the district property tax on each $100 of assessed valuation or, if no tax has been imposed yet, the projected rate. It must give the amounts of voter-approved bonds and the initial principal amounts issued, divided among water, sewer and drainage facilities, road facilities, parks and recreational facilities and any other category. It must disclose whether the district sought approval of a standby fee and its amount, whether the district lies in a city's extraterritorial jurisdiction or inside its corporate boundaries, and whether a strategic partnership agreement exists. It must state the district's purpose and that the cost of district facilities is not included in the purchase price of the property, and it must warn that the information is subject to change by the district at any time and that the district annually establishes tax rates.

Where the buyer or the seller gets the form is also stated. Section 49.453 requires a covered district to keep the form in its office and, on written request, issue it completed with the information the district must furnish, for a fee not to exceed $10. Section 49.455 requires the board to file with the county clerk an information form that includes the most recent rate of district taxes, the bond amounts approved and issued and whether a standby fee is imposed, along with a map or plat of the district's boundaries. Section 49.454 provides for a certificate of unpaid standby fees on request, again for a fee not to exceed $10. TCEQ's general guide adds that districts must designate an agent of notice whose name is filed with TCEQ. That guide was last revised in October 2019 and says there is no requirement that the notice be provided both before the contract and at closing, whereas the statute text, which is current through the 2025 second called legislative session, requires a separate recorded copy at closing in addition to the pre-contract notice. A buyer should ask the title company which notice forms will be signed and recorded.

For remedies, Section 49.452 allows a purchaser whose sale was not made in compliance to sue for damages under one of two subsections, one measured by the costs of the purchase and the other limited to $5,000 plus reasonable attorney's fees, and it provides that sellers, title companies and agents are not liable for failing to give the notice when the district has not filed its information form and map with the county clerk. The notice is a disclosure, not a guarantee, and its numbers are the district's figures as of a date.

Where to find a district's own information

TCEQ's Water Districts page lists the main resources. A Water Districts Map lets an owner find the district that serves an address and information about its board of directors, including contact information, and a Finding Your Water Supplier tool shows who provides water to a property. The page also points to the Water Districts Data database, which includes contact information, office addresses and counties for municipal utility districts, special utility districts, river authorities, water control and improvement districts and others, and to the general guide GI-043. TCEQ is responsible for general supervision of water districts, including reviewing the issuance of bonds that finance certain district infrastructure, but the guide is clear that district boards, not TCEQ, handle daily operations.

TCEQ's guide identifies four documents worth requesting from any district: the notice of tax rate, the notice to purchaser, the audited financial statements and the directors' pay statements. A district must have an annual audit by an independent auditor if it has outstanding bonds, gross receipts over $100,000 in the fiscal year, or cash and temporary investments over $100,000 at any time in the year. Districts must also allow inspection of open records under the Public Information Act, and the guide says a request may be required in writing. These documents show how much debt is outstanding against the homes in a district, which is the number that drives the debt-service rate.

For tax rates themselves, the appraisal district and the county tax office publish tables like the ones used above, and the Comptroller publishes statewide rate reports. Those tables are lists of taxing units. A public improvement district assessment may not appear as a rate, so the PID's annual service plan update, which the city or county approves each year, and the notice the seller delivers are the better sources for an assessment amount. The prescribed notice says the exact amount of the assessment may be obtained from the municipality or county that levies it.

Questions to put to the seller, title company and district

Ask which districts cover the specific lot, and confirm it against the tax statement and the appraisal district's property record rather than the subdivision name. Ask for the district's notice to purchaser and its current tax rate, the bonds approved and issued, the standby fee if any, and whether the city can annex and dissolve the district. For a PID, ask for the assessment amount, the number of remaining annual installments, the service plan and how the payoff works if the home is sold. For an emergency services or hospital district, ask whether its rate is already on the statement you are comparing.

Then compare like with like. Put every taxing unit's rate for the same tax year on one sheet, using the appraisal district's own table where it exists, add any PID installment separately, and adjust the school, county and city lines for the exemptions each unit actually offers. For a retiree on a fixed income, the district lines are worth the extra hour because they are the part of a bill that a county or school ceiling may not cover, and a new district may still be adding debt.

Places where this matters most

• GeorgetownA Williamson County city on the northern end of the Austin corridor, with a historic town center, a hospital and clinics in town, an age-restricted community on its west side, and a property-tax picture that depends on a layered set of local taxing units.
• BoerneA Kendall County city in the Hill Country with a historic Main Street district, a younger and higher-income profile than the region's retirement towns, a freestanding emergency room and no inpatient hospital described on the hospital system's pages, and a 2026 flood that put creek risk and water supply at the center of the buying decision.
• BastropThe Bastrop County seat in the Lost Pines forest on the Colorado River, with a small downtown, an emergency room in town, a new 55+ Del Webb community under construction, and a wildfire history that any buyer should understand.
• Fort WorthFort Worth is the large city anchoring the west side of the Dallas-Fort Worth Metroplex, mostly in Tarrant County, with a hospital district, major medical centers and two airports of its own. It is better understood as a set of very different neighborhoods than as one retirement market.
• MansfieldMansfield is a suburban city in the Dallas-Fort Worth Metroplex whose limits reach into Tarrant, Johnson and Ellis counties, with a 294-bed hospital in town and a gated 55+ community that is selling new homes.
• McKinneyA large Collin County city north of Dallas with a preserved historic downtown, two full-service hospitals inside the city, a housing stock priced below neighboring Frisco, a 55+ Del Webb community inside the master-planned Trinity Falls, and a property-tax picture built from the city, county, community college and school district plus any special district.
• FriscoA fast-growing Dallas-area suburb that straddles the Collin and Denton county line, with three hospitals in the city, a mostly post-2000 housing stock, a high-cost and high-income profile, a lakeside 55+ community on Lake Lewisville, and a property-tax bill that depends on which of several school districts and which of two appraisal districts a parcel falls in.
• GranburyA Hood County city on Lake Granbury, a Brazos River reservoir southwest of Fort Worth, with a historic square, a community hospital and a freestanding emergency room, a city-owned airport, one of the older populations in the Fort Worth area, and a property-tax and water picture that depends on Hood County, Granbury ISD and the lake's drought rules.

Communities where this matters most

• Pecan PlantationA gated golf, marina and airpark community of about 3,000 acres south of Granbury, open to buyers of all ages, with a mostly Hood County location, an owners association and, by the Census estimate, a population in which nearly half are 65 or older.
• DeCordova Bend EstatesA gated golf and marina community on Lake Granbury, platted in 1969 and incorporated as the City of DeCordova in the early 2000s, open to buyers of all ages, with an 18-hole championship course and a median age of 54.5 in the Census estimate.
• Del Webb Austin at Lost PinesA Del Webb community marketed as 55+ inside The Colony master plan in Bastrop, selling single-family homes in three series from $294,990 while its amenity center is under construction.
• Sun City TexasA large Del Webb active adult community in northwest Georgetown, marketed as 55+, with three championship golf courses, four fitness centers, eight pools and new single-family homes from $340,990.

Related guides

• Texas property taxes and appraisal districts: how to compare actual total tax bills
• Texas homestead exemption, the age-65 exemption and the school tax ceiling
• HOA, condo, club and special assessments for Texas retirees: what the charges are and what to ask
• New construction versus resale homes in Texas