WHAT IS THE MUD TAX?
MUD stands for Municipal Utility District and is a subdivision of the State of Texas created to build infrastructure and provide services like water, sewer, and stormwater drainage in areas where a city cannot provide them. This typically happens when a new residential development is built outside a city’s public water services.
The MUD tax on your bill is your household’s contribution to building this new infrastructure to provide water services to your property and neighborhood. Over time, the MUD tax decreases as the initial bill is paid. In 20-30 years, your MUD tax could be virtually zero.
WHAT IS THE PID TAX?
A PID is a Property Improvement District, a special district created by a city or county that allows it to charge an assessment to properties within a certain area (like a new neighborhood) to build out additional infrastructure. While MUDs typically focus on water services, a PID tax would pay for:
- Enhanced landscape
- Additional open space
- Lakes and fountains
- Improved city parks
- Shade structures
- Various recreational and pedestrian improvements
PID taxes end when the tax levied against a property (like a home) is paid in full. PID taxes may be spread out over 20-40 years, or they may be paid in-full and up-front by the homeowner.