Municipal Utility Districts (MUDs)

Overview

A Municipal Utility District (MUD) is a type of special district that allows a developer to fund development typically outside of a City’s corporate boundary (i.e. city limits). While typically residential or mixed-use in nature, a MUD can also be commercial or industrial. Once established a MUD may issue bonds to fund, water, wastewater, drainage, electrical services, roads or other infrastructure and services within the MUD boundary. MUDs are established through application to, and approval by the Texas Commission on Environmental Quality (TCEQ), or through the Texas legislature.

As part of the TCEQ application process, a proposed MUD is required to seek consent from any city in whose ETJ the MUD wishes to locate. The proposed MUD should provide the TCEQ with evidence that the application (to the TCEQ) conforms substantially to the City’s consent and provide evidence that the City’s consent does not place any conditions or restrictions on the proposed MUD District unless otherwise negotiated through a development agreement.

MUDs in Denton

The City of Denton City Council adopted the MUD policy October 25, 2022 by Resolution 22-2075. The goal of the policy was to foster coordination between the City of Denton, Denton County, new MUDs, and new developments within the City. This policy will also ensure that proposed MUDs meet the goals of the Denton 2040 Comprehensive plan. The City of Denton is seeking to work with developers of MUDs to provide the greatest value and service for these communities.


Process for Submitting a MUD Application

Applicants are encouraged to submit the following application and checklists to the City of Denton. Following application, you will be contacted by City staff to begin working together an agreement between the City and the MUD on how the MUD will be developed, how services will be provided, and how the MUD will be managed over time will provide a level of certainty and clarity for both the MUD and the City. The City is committed to working with MUDs towards an equitable agreement that allows both the City and the MUD to achieve their goals.

To submit an application for a MUD. 

  1. Read the MUD Policy Below.
  2. Fill out the MUD Application and Checklist completely. 
  3. Email your MUD Application and Checklist to [email protected].

Email [email protected] or call (940) 349-8600 for any questions regarding MUDs. 

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