Four years ago, Judie Morton relocated from Colorado to Round Rock to be closer to her children. Running on a tight time frame to purchase a home and following tours of a few houses in Hutto and one in Round Rock, Morton moved into the Siena neighborhood, saying her new home was the right size and fit. Then, the tax bill came.

“It was really a sticker shock when I got the first bill for my taxes, that was over $7,000 for a house that cost me $224,000,” Morton said.

Siena is a municipal utility district, or MUD, a master-planned community that typically exists outside a city’s limits.

There is a common misconception that homes built in unincorporated areas are less expensive alternatives to in-city living, said Larry Gaddes, Williamson County tax assessor-collector. But, Gaddes said, that is generally not the case.

“It’s not cheaper if you live in a MUD, but here’s the thing: Most people just don’t know,” Gaddes said. “They just haven’t done their homework. Not only are the homes more expensive, but the tax rate is much higher.”

City tax rates in Williamson County range from approximately $0.42 per $100 of taxable value, as seen in Georgetown and Round Rock, up to $0.55 in Leander and $0.63 in Hutto. While MUD residents do not pay city taxes, many newer MUD developments have their own tax rates listed between $0.85-$0.95, Gaddes said, before tacking on up to an additional $0.10 for fire protection from the emergency services district. As a result, MUD residents often end up paying nearly double the taxes of in-city residents, Gaddes said.

Morton said she had not done nearly enough homework on MUDs and how they operated before purchasing her home. But the impression she, and many MUD residents, had when purchasing their homes is that as the neighborhoods are built out, the tax rates would decrease over time. Morton said she is beginning to believe that will not happen anytime soon.

Morton lives on Sardinia Drive, one of the first streets within the subdivision, and said Siena’s geographic limits extend 2-3 miles behind her home, crossing Limmer Loop and nearly reaching University Boulevard.

“They just keep building, and the MUD just keeps going,” Morton said. “And I think that’s what’s gotten me: There’s no end in sight.”

Despite miles of homes being built, she said her tax bills have not budged.

“Not one dime has gone down,” Morton said. “Not one.”

MUD entities are authorized by the Texas Commission on Environmental Quality and provide water, sewage, drainage and other utility-centric services within the MUD’s geographic boundaries. Emergency and police services are provided by ESDs and the county, while community resources—such as library cards—are overseen by the surrounding city and can come with nonresident fees.

Casey Toole, a resident of the Sam Bass Corridor neighborhood in Round Rock, said she previously lived in the Brushy Creek MUD. One of the positives of MUD neighborhoods, Toole said, is the sense of community and the amenities, such as pools, community centers and parks maintenance. But higher taxes and water rates, she said, ultimately were not worth the costs.

“When I was ready to move I chose a neighborhood that was served by the city of Round Rock,” Toole said. “I was able to afford more house not having to pay the extra taxes.”

There are more than a dozen MUDs currently existing in and around the city of Round Rock and its surrounding extraterritorial jurisdiction, along with two in-city MUDs planned for development, Bradley Dushkin, assistant director of Planning & Development Services for the city of Round Rock, confirmed. Some MUDs were developed on outskirts of unincorporated land, while others jut up against in-city neighborhoods. But despite those in close proximity to in-city housing, the difference in costs is significant, Gaddes said.

“My home is $300,000, and those homes are $400,000, and the tax rate is higher, so think about paying $1,500 more a year over the course of 10 years—you’ve paid $15,000,” Gaddes said. “I’d rather have $15,000 in my pocket.”

Paul Murray has lived in Brushy Creek MUD since 2014 and said no one intentionally opts in to living in a MUD—it is all a matter of cost and location.

“People choose where to buy or rent a home based on location, cost, and schools,” Murray said in an email to Community Impact Newspaper. “Everything else just comes along for the ride.”

The premise of MUDs, Murray claimed, was to deregulate utilities. But Murray said that equal access, safety and security of utilities is not always prioritized due to a lack of profit incentives.

“I was much happier living in Austin where the city controlled the utilities,” Murray said. “And there was more transparency and oversight into the rate structures and use of my money.”

This summer, Morton said she saw several homes up for sale or sold on her street alone. Both Morton and Gaddes said that people should re-evaluate the idea that unincorporated living equates to reduced costs of living.

Morton said that when she first met with her Realtor to discuss the home she now lives in, in Siena, the heightened tax rates had been addressed. But with MUD debt issuances often running between 20-30 years, those heightened rates can, and do, continue even as more homes are being sold.

“We were told that as soon as the community was fully built that the yearly assessment would go away. But the community keeps growing and growing with, seemingly, no end in sight,” Morton said. “I’d venture that the MUD assessment has a lot to do with why people are trying to move out of Siena.”

Morton’s daughter recently bought a home in the La Conterra development near Georgetown, 8 miles down the road from Siena. But those 8 miles, Morton said, factor into nearly $2,500 more in annual taxes she has to pay compared to her daughter.

“You know, I like my home, and I like being this close to my family. But people have said, ‘Why don’t you move?’” Morton said, pausing for a moment. “I’m too old to move. This is it.”

Ali Linan and Brian Perdue contributed to reporting on this story.