FREQUENTLY ASKED QUESTIONS
What is Clovercreek Municipal Utility District?
Clovercreek Municipal Utility District of Montgomery County (the “MUD”) is a political subdivision of the State of Texas operating pursuant to Chapters 49 and 54 of the Texas Water Code, created on April 24, 1985, and located in southwest Montgomery County, Texas. The MUD contains approximately 157.9 acres of land and is located approximately 37 miles west northwest of Houston’s central business MUD and 4 miles southeast of the City of Magnolia. The MUD is located within the Magnolia Independent School District and is not located within the extraterritorial jurisdiction of any city.
District goals?
To provide quality water, sanitary sewer and drainage services to residents within the MUD.
How to achieve those goals?
Goals will be achieved by having sufficient resources for repairing, rehabilitating and/or replacing facilities with little to no interruption of service to the MUD’s customers.
What is a bond authorization?
A bond authorization is an approval process to authorize the MUD’s Board of Directors to sell bonds at future dates to fund capital projects within the MUD. An authorization is not immediate funding, nor is it a “blank check” to fund projects without meeting strict regulatory requirements. While an authorization may be approved for a large amount, bonds may only be sold if and when necessary projects are ready to begin.
What will the bond authorization be used for?
A bond authorization would allow the MUD to sell bonds in order to fund aging facility equipment, assets and conditions at the wastewater treatment plant and water plant.
What is a Refunding Bond?
A Refunding Bond allows state and local governments to restructure debt service payments, achieve savings on outstanding bonds, and secure more favorable interest rates. If approved, this authorization would give the MUD the ability to refund existing bonds, providing greater financial flexibility through improved interest rates and restructured debt service payments.
What is the current M&O tax rate and why does it need to be raised?
The MUD’s current voter-approved Maintenance & Operations (“M&O”) tax rate is $0.50 per $100 of assessed value. The MUD is asking voters to authorize an increase to the maximum M&O tax rate so that the Board may levy up to $1.50 per $100 of assessed value. This authorization does not itself raise the tax rate, it simply expands the ceiling the board may consider during its annual tax rate review. The current Debt Service tax rate is $0.50 per $100 of assessed value. Likely, the Debt Service tax rate will be lowered, and the M&O tax rate will be increased.
How will the propositions affect my tax rate?
If voters approve all three propositions in May, there will not necessarily be a tax rate increase for Clovercreek Residents. In addition, the MUD has a $12,000 homestead exemption for individuals over 65 or disabled.