Nov Election: Brazos County prop A and B - 1/3 Billion $ in bonds

1,702 Views | 19 Replies | Last: 7 days ago by SARATOGA
chimmy
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Brazos County municipal utility district No. 1

Proposition A

Quote:

The issuance of $235,600,000 bonds for water, sanitary sewer, and drainage and storm serer system and the levy of taxes, without limit as to rate or amount, in payment of the bonds.


Proposition B

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The issuance of $104,060,00 bonds for roads and the levy of taxes, without limit as to rate or amount, in payment of the bonds.


A quarter billion dollar loan for water works and hundred million dollar loan for roads - is this really needed?

Also, is the verbiage ""[...] without limit as to rate or amount, [...]" required for obtaining the best bond rates for citizens, or is it a backdoor way for the county to raise taxes on citizens?
LSCSN
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curious as to what our already high taxes pay for. not a big deal with its someone else's money.
CS78
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With taxes out of control, I'm going to find it hard to vote yes for ANY bond proposal in the near future. Perhaps it's one way for the peasants to get the message across.
dallasiteinsa02
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Does Brazos County handle much of Prop A? I would think almost all of the water and sanitary sewer is taken care of by other entities. Maybe some drainage and storm sewer but not much. If there are areas that need this that are just in the County, let them take care of it not the Bryan and College Station residents.
agnerd
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AG
Welcome to the big time BCS!

This is for a MUD. Very common in the big cities like Houston and Dallas. It is normally used as a way to pay for a water plant, sewer treatment plant, water lines, sewer lines, and sometimes roads for an area outside the city limits that a city isn't interested in developing. It allows the developer to borrow money to build all that stuff and then tax his land to pay back those bonds. He uses the bond money to build his subdivision and start selling lots. The homeowners pay that tax rate to the MUD to provide water and sewer instead of paying taxes to the city. Only landowners within that MUD get to vote on those bonds. Usually it's just a single landowner when the subdivision is first getting started. Instead of paying taxes to a city. Future residents of that area will pay taxes to the MUD.

Nothing most Brazos County residents need to worry about. Bond holders will be the only ones on the hook if s--- hits the fan. Same thing as not caring about Bryan issuing bonds when you live in CS.
SARATOGA
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There are already 2 MUDs in town. Speedway (Southern Pointe), and Millican Reserve.

Vastly decreases risk on the part of the developer, and on the back end vastly increases wealth. Basically residents of the subdivision pay an additional amount (~ 1% percentage of their homes value) to the MUD forever. It looks like a "tax" but it isn't a tax as it is a fee going back to the developer every year, forever.
SARATOGA
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Taxes are one thing.......but anything MUD, vote NO (if you ever have the opportunity)


NO NO NO NO NO NO NO
UmustBKidding
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Unfortunately you only get to vote on these if you are within the precinct. They typically deposit a mobile home so they can register one and only one resident in that precinct and you know how they will vote.
dallasiteinsa02
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My problem with a MUD is the disclosure to the buyers. They ask what the tax rate is and the builder or realtor says 2.42%. Infrastructure for a home may be $30,000. Not knowing that you are going to pay that over the next 10 years plus interest can really catch a family off guard.
SARATOGA
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what is the precinct ? Is it the whole county or just parts ?
UmustBKidding
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There will be a precinct drawn to only include the mud area.
agnerd
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AG
SARATOGA said:

There are already 2 MUDs in town. Speedway (Southern Pointe), and Millican Reserve.

Vastly decreases risk on the part of the developer, and on the back end vastly increases wealth. Basically residents of the subdivision pay an additional amount (~ 1% percentage of their homes value) to the MUD forever. It looks like a "tax" but it isn't a tax as it is a fee going back to the developer every year, forever.
Not forever. I work with a MUD in Houston that's 30 years old. After the subdivision was made up of 51% residents, they voted the developer out and took control. They've paid off all their infrastructure and reduced their tax rate from 2.5% to 0.2%. Now they just pay for maintenance of what they have. City tax rate I think is at 0.6%. I wouldn't live in a new MUD, but I would absolutely live in an old MUD and pay lower MUD taxes than higher city taxes. Everytime Bryan or CS pays something off, they magically find a way to continue to spend that same amount of money on something new.
woodiewood1
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agnerd said:

SARATOGA said:

There are already 2 MUDs in town. Speedway (Southern Pointe), and Millican Reserve.

Vastly decreases risk on the part of the developer, and on the back end vastly increases wealth. Basically residents of the subdivision pay an additional amount (~ 1% percentage of their homes value) to the MUD forever. It looks like a "tax" but it isn't a tax as it is a fee going back to the developer every year, forever.
Not forever. I work with a MUD in Houston that's 30 years old. After the subdivision was made up of 51% residents, they voted the developer out and took control. They've paid off all their infrastructure and reduced their tax rate from 2.5% to 0.2%. Now they just pay for maintenance of what they have. City tax rate I think is at 0.6%. I wouldn't live in a new MUD, but I would absolutely live in an old MUD and pay lower MUD taxes than higher city taxes. Everytime Bryan or CS pays something off, they magically find a way to continue to spend that same amount of money on something new.
Governments will never quench their thirst for OPM.
SARATOGA
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Case example.

Build a 500k home in Millican Reserve.

Taxes are what right now $1.9 per hundred?, so taxes of $9500, most people know that going in.......

BUT SURPRISE, "Mud Tax" to the developer is another $5000, and it isn't just once, its every year !

Even if you can afford a 500k house in Millican Reserve, nobody is going to ignore $5000 every year, or even for 30 years - thats 150k !


A developer used to have to float a loan, take the risk, develop the land, get money back once lots start to sell, continue build out and then make money if its successful. Thats risk, Thats capitalism. Thats fine !

Now they're just stealing early and often. Risk is very little in our booming market, loans are paid back earlier, and then they are still floating on the "tax" cash flow YEARS after the subdivision is built out, and long after the development costs have been covered and profit from sales of lots is taken..
RGRAg1/75
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AG
Hmmmm....Gabe should probably start mentioning this when he reads their advertisement on TA radio. That's absurd.
cslifer
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Implying the developer has no risk is pretty disingenuous. By law they have to pay for or put up at least 30% of the cost of the utilities. And where are you getting that the developer gets the tax money, and that it stays that rate "every year"? That isn't even close to true.
lost my dog
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SARATOGA said:

Case example.

Build a 500k home in Millican Reserve.

Taxes are what right now $1.9 per hundred?, so taxes of $9500, most people know that going in.......

BUT SURPRISE, "Mud Tax" to the developer is another $5000, and it isn't just once, its every year !

Even if you can afford a 500k house in Millican Reserve, nobody is going to ignore $5000 every year, or even for 30 years - thats 150k !


A developer used to have to float a loan, take the risk, develop the land, get money back once lots start to sell, continue build out and then make money if its successful. Thats risk, Thats capitalism. Thats fine !

Now they're just stealing early and often. Risk is very little in our booming market, loans are paid back earlier, and then they are still floating on the "tax" cash flow YEARS after the subdivision is built out, and long after the development costs have been covered and profit from sales of lots is taken..
So don't buy a home in a MUD. If it doesn't make economic sense, why as a buyer play the MUD game?

If developers who create MUDs can't sell the houses they build, then MUDs will go away,
SARATOGA
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The market will work it out. But I just think a MUD is relatively new to most folks, and people might buy a house in a MUD district without knowing that it is and then get a big surprise come tax time. But again, it isn't an actual tax, it is just slid in with the tax time/payments. But that money goes to the developer, not the city/county that is doing things like roads, and schools, and emergency services. It comes at tax time, shows up on the appraisal district website, but is NOT part of TAX income to taxing entities. Its more like a giant surprise HOA fee. It isn't paid to the Brazos County tax office (like the other), it is paid to the MUD company.

So for Southern Point (Racetrack) MUD1 and Millican Reserve MUD2 - buyer be aware....

I think threads like this are helpful to inform the public about something that is relatively new to our area.
agnerd
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AG
SARATOGA said:

The market will work it out. But I just think a MUD is relatively new to most folks, and people might buy a house in a MUD district without knowing that it is and then get a big surprise come tax time.
This will NOT be a surprise at tax time. Their lender will get a tax statement and will notify the buyer in multiple ways about the total tax burden for the house. The realtor will also provide this information. When I bought a house, every single tax I would have to pay was itemized and provided to me at least 6 times. Claiming I wasn't aware of the ISD tax would be my own fault.
Quote:

But again, it isn't an actual tax, it is just slid in with the tax time/payments.
It IS an actual tax. Instead of paying taxes to the city for your water, sewer, and roads, they will pay taxes to the MUD to provide water, sewer, and roads within the district.
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But that money goes to the developer, not the city/county that is doing things like roads, and schools, and emergency services.
It goes to the DISTRICT, controlled by the developer, but he is REQUIRED to spend it on water, sewer, and ROADS. These internal roads will NOT be provided by the county. Schools are a completely separate taxing entity (like a MUD) and levy their own taxes (like a MUD). You can pay your taxes directly to ISDs without funneling them through the county if you want. You can even gain certain tax advantages.
Quote:

It comes at tax time, shows up on the appraisal district website, but is NOT part of TAX income to taxing entities. Its more like a giant surprise HOA fee. It isn't paid to the Brazos County tax office (like the other), it is paid to the MUD company.
It is part of the TAX income to the MUD taxing entity. HOA fees, don't depend on your appraisal. MUD taxes do.
SARATOGA
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The MUD "tax" does help the developer build water lines, sewer lines, and roads at the beginning, (something they'd have to pay for initially out of their own pocket, then slowly recoup those costs as lots sell). But after the roads and sewer lines are built, the $ goes straight to their pocket for private jets, large ranches in south Texas, and new F-250s for the kids or whatever. And whether you call it a "district" or an LLC, or a Partnership, or any other sort of name, it is an entity that exists to get money from people buying or building houses in that development and transfer that money to the developers pocket.

And considering that fact that there are only 2 MUD districts in our area - People should know it isn't a tax, and they should know what the money goes for. Maybe they want to live on top of an old racetrack where Willie Nelsons car caught fire at his 4th of July picnic so bad that they want to pay a 1% premium for the conversation starter.........but a MUD is developers working the back channels and good old boy network to get the city council to approve a mechanism whereby they can recoup financial outlays on development faster, and create a personal revenue stream for years to come.
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