Residents in two municipal utility districts in The Woodlands—MUD 40 and MUD 2—voted to consolidate during the Nov. 3 election, according to unofficial results. Eighty-six voters in MUD 2 were in favor of consolidating, as opposed to 56 who voted against the measure. Seven hundred and thirty-one residents in MUD 40 voted to consolidate, while 399 voted against it. Only residents in the boundaries of both MUDs were eligible to vote in the election, which had to first be approved by members of both boards. “A consolidation agreement was developed and put before the two boards,” said James Stinson, general manager for The Woodlands Joint Powers Agency, which provides water, sewer, drainage and tax collection services for both MUDs. “But it was not unanimous on either board [to] put it on the ballot. MUD 2 it was a 3-2 vote and MUD 40 it was a 4-1 vote.” Each MUD has a five-member board that is elected by voters within its boundaries. Board members serve four-year terms. MUD 40 and MUD 2 will operate as one board with 10 directors until May, when there will be an election to reduce the number of directors from 10 to five. The two MUDs also have different tax rates—MUD 40 has a 9-cent rate while MUD 2 has a 10-cent rate. Those rates will remain in effect through next summer when the consolidated MUD will establish a new tax rate for 2016. There are pros and cons to consolidating MUDs, which has not happened before in The Woodlands, Stinson said. “It is rare because it takes some unique things to come together,” he said. “Their tax rates need to be fairly the same, reserves need to be comparable, and the age of the infrastructure needs to be comparable before it even makes sense to discuss [consolidating].” Neither MUD 40 nor MUD 2 has outstanding debt, but their tax bases do have variances. MUD 2 is made up of primarily single-family residential homes appraised at a higher value than much of The Woodlands, including the community of Grogans Point. “It’s a fairly affluent, high-end community, but there is really no commercial or retail activity of any magnitude,” Stinson said. “MUD 40 is a good mix of residential home sites, but it also has some commercial retail centers and grocery store strip centers. As a pro for MUD 2 they [will] get some diversification to the tax base, and MUD 40 [will] receive an area with some high appraised homes.” Cons to consolidation include potential changes in local representation and levels of service, Stinson said. When the new board is elected, there could be a loss of autonomy, or different priorities for the new MUD directors, he said. The two MUDs are not contiguous either—MUD 2 covers the Grogans Point area while MUD 40 includes most of Panther Creek. Additionally, there is a difference in population in the two MUD boundaries. There are more than 2,200 service connections in MUD 40 and less than 400 in MUD 2, Stinson said. Consolidation means there are cost savings associated with board member expenses because it brings down the number of MUD directors from 10 to five, Stinson said. “MUDs are required to have a yearly audit, so if you consolidate down to one, you save that yearly expense,” he said. “MUDs also have an attorney that guides them through legal matters, so you are eliminating costs for one attorney as well. It gives us a chance to pool resources and reserves to meet future service needs. Some see that as an advantage.”