This Sunday Chron article on property tax variances was a bit of a disappointment to me. I don't think it's any great secret that some municipalities in Harris County, like Southside Place, have lower taxes than others - I mean, isn't that the reason for Southside Place's existence? What else is there? I guess I was hoping for an article on why property valuations can vary so much within a neighborhood, but that isn't what I got. Alas.
The discussion of municipal utility districts (MUDs) was interesting enough.
Municipal utility districts, which install and operate water and sewer systems in many new neighborhoods outside incorporated cities, frequently charge homeowners $1.50 to $2.50 per $100 assessed valuation to pay off the costs of the infrastructure. That leads to neighborhood property tax bills that are wildly inflated for several years until the MUD costs come down.
The new neighborhoods of Village of Northgate Forest and Cypress Mill Park are the two most heavily taxed areas of Harris County, according to a Houston Chronicle analysis of county and Harris County Appraisal District tax records. Both have high MUD taxes, driving their overall tax burden skyward.
The total tax bill for a home in Northgate Forest, for example, is $5.36 per $100 assessed valuation, meaning a $500,000 home was taxed last year at nearly $25,000 after homestead exemptions. By comparison, a similarly valued home would have been taxed at about $11,000 in Houston or $9,500 in Southside Place.
The developers of Northgate Forest recognized they would have trouble attracting buyers with such high taxes, so they agreed to pay all but $1.25 of the subdivision's $2.79 MUD taxes.
"We knew that we could not sell these lots with a $2.79 or $3 rate," said Doug Shannon, the general manager of the Northgate Forest Development Company. "So that's why we subsidize it down to $1.25."
Questions that weren't addressed but which I'm curious about anyway: How does new development, especially dense townhouse development, in existing populated areas affect utility services? Is there a cost to extend or expand water and sewage to city blocks that now may have a lot more people living in them, and if so who's paying for it? I've been wondering about this since the inner-loop boomlet began.Posted by Charles Kuffner on August 16, 2004 to Elsewhere in Houston | TrackBack