Page 4 - ABHR MUD BOOK 2022

MUNICIPAL UTILITY DISTRICTS IN TEXAS—A BRIEF INTRODUCTION

Throughout recent years, Texas has experienced continued economic and population
growth that is unrivaled across the nation. For good reason. The policies that state and
local leaders have implemented over the years allow for private investment to stimulate
the economy and ultimately benefit our entire society. All the statistics say the same
thing and allow for only one rational conclusion—people are moving to Texas in record
numbers and they are finding a healthy economy and vibrant housing market upon

their arrival.

The “Texas Miracle” is largely understood to refer to our State’s phenomenal ability to
produce jobs, allowing our economy and population to grow and develop. However,
the Texas Miracle could not occur—and would not be as successful—if Texas was not
able to provide a steady supply of new affordably-priced housing, supported by quality

public infrastructure. This is the Municipal Utility District (“MUD”) contribution to the
Texas Miracle.

A surging economy requires an adequate supply of housing options. Failure to provide
the basic infrastructure and housing needs of a rapidly growing, working population
results in a systemic failure that undercuts prosperity. In Texas, Municipal Utility

Districts and other water districts encourage the development of the infrastructure
necessary to support growth, all the while staying true to the conservative financial
principles that have forever guided our decision making at the state and local level.

The cost of infrastructure can greatly curtail a local government’s ability to support
necessary and desirable growth. Additionally, existing residents of a community may
not desire to pay the cost of extending utilities to new neighborhoods. In this sense,

many cities are unwilling or unable to fund new infrastructure for new home
construction. This is where the MUD comes in. MUDs allow growth to pay for itself.

1