PRESENTER: Presenter
Matt Greene, Principal Planner
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SUBJECT: Title
Approval of a Resolution to consent to the creation of the Botanical Farm Municipal Utility District (MUD) within the City’s Extraterritorial Jurisdiction (ETJ) in Guadalupe County, consisting of approximately 250 acres, and authorizing the City Manager to execute a development agreement between the City of New Braunfels and O Union Wine Rd, LLC.
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DEPARTMENT: Neighborhood and Community Planning
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COUNCIL DISTRICTS IMPACTED: Outside City Limits
BACKGROUND INFORMATION:
Case #: CS24-0334 & CS25-0216
Applicant/Agent: Richard Mott, VP of Land Development
Lennar Homes of Texas Land & Construction, LTD
100, NE Loop 410
Suite 1155
San Antonio, TX 78216
(210) 889-5516 | richard.mott@lennar.com
Owner: 0 Union Wine Rd, LLC
Fred Heimer, Manager 130 S. Seguin Ave.
New Braunfels, TX 78130
(830) 625-8410 | fred.heimer@sv-re.com
Staff Contact: Matt Greene
(830) 221-4053 | mgreene@newbraunfels.gov
The Texas Water Code (Chapter 54) and the Texas Local Government Code (Chapter 42, Section 42.042) (see resource links) outline the procedures for the creation of Municipal Utility Districts (MUDs). A MUD is a political subdivision of the State: it is one of several types of special districts that function as independent, limited governments of their own. One purpose of a MUD is to provide a developer an alternate method of financing the design, construction, acquisition, improvement, extension, maintenance, and operation of infrastructure such as water, sewer, drainage, and roads.
Managed by a board of directors elected by the property owners within the MUD, the MUD can levy its own taxes and fees on the property owners/residents within the development to repay the developer for their up-front costs and long-term maintenance. MUDs are generally desired by developers when the subject properties lie beyond utility provider service areas/outside utility company Certificates of Convenience and Necessity (CCNs).
Chapter 42 of the Texas Local Government Code (LGC) establishes and outlines the rules for ETJ or Extraterritorial Jurisdiction. ETJ is that territory that extends into the unincorporated area beyond city limits where certain limited city standards can be applied. The ETJ was intended to be the area a city could annex into, therefore the rules that were allowed to be extended essentially prepared the area so that when/if annexed, development was not haphazard or disjointed. The stated policy in LGC 42.001 is “to promote and protect the general health, safety, and welfare of persons residing in and adjacent to the municipalities.”
When a proposed MUD lies within the boundaries of a city’s ETJ, state statute indicates the respective city must give its consent before the MUD may be established. Consent by the municipality allows the developer to initiate proceedings to create the MUD through the Texas Commission on Environmental Quality (TCEQ). State statute also mandates cities follow consideration timeframes for MUD petitions:
If the city fails or refuses to give its consent for the creation of the MUD on mutually agreeable terms within 90 days after the date the City Council receives a written request for the consent, a majority of the qualified voters of the area of the proposed political subdivision and the owners of at least 50 percent of the land in the proposed political subdivision may petition the City Council to make available to the area the water, sanitary sewer services, or both that would be provided by the political subdivision. If, within 120 days after the date the City Council receives the petition, the City Council fails to make a contract with a majority of the qualified voters of the area of the proposed political subdivision and the owners of at least 50 percent of the land in the proposed MUD to provide the services, that failure constitutes the governing body’s consent to the creation of the proposed political subdivision.
The above statute does not contemplate the unique situation in our region where the various applicable utility providers are not governed by the municipality (see the Utilities section below).
The completed petition application with a request that the City consent to the creation of the Botanical Farm Municipal Utility District (MUD) was received by the City on January 16, 2026. The statutory 90-day period during which the City may consent to or object to the creation of the proposed MUD expires on April 16, 2026. In the event the City Council denies the petitioner’s request for consent, the applicant’s avenue for appeal is through the Texas Commission on Environmental Quality (TCEQ).
Location and Features
The subject property consists of approximately 250 acres of unplatted land proposed for master planning and platting as the Colina Ranch Subdivision and the Autumn Ridge Subdivision. Both proposed subdivisions are located in Guadalupe County, bound by Union Wine Road to the north, Youngsford Road to the south, FM 1044 to the west, and Elmons Road to the east. Altwein Lane bisects the proposed MUD, separating the two subdivisions. A small portion of the Colina Ranch property adjacent to Long Creek is located within the 100-year floodplain.
Utilities
The subject property is located within Green Valley Special Utility District’s (GVSUD) water CCN which is the intended water provider. The subject property is located within Guadalupe-Blanco River Authority’s (GBRA) wastewater CCN which is the intended wastewater provider.
ISSUE:
New Braunfels’ development rules do not apply outside the city limits in the ETJ in Guadalupe County. Without a MUD, development can still occur, simply in compliance with Guadalupe County development rules instead of the City of New Braunfels’ rules. Land use and other development standards are not enforceable in the ETJ unless such regulations are agreed upon through the execution of a development agreement between the developer and the City.
To ensure that development within the proposed MUD is of a quality that serves as a benefit and asset-rather than a detriment-to the residents and taxpayers of the City of New Braunfels, and to ensure that water and wastewater infrastructure, service, and long-term maintenance are adequately addressed, it has been standard City policy for MUD developers to enter into a development agreement with the City pursuant to the authority granted under Texas Local Government Code Chapter 212 prior to submitting a petition. Standard MUD development agreements have included enhanced subdivision and neighborhood design standards; requirements for trees, landscaping, safe pedestrian mobility, and environmental protections consistent with Envision New Braunfels and the City’s Strategic Plan; as well as provisions requiring the issuance of building permits and completion of inspections for all residential and commercial structures to ensure compliance with adopted building and safety codes.
The proposed development agreement (attached) establishes minimum development standards related to housing diversity; landscaping and lighting; historical and archaeological protection and remediation; TIA and offsite improvement requirements; a voluntary annexation request upon dissolution of the MUD*; and the requirement to obtain City-issued building permits and inspections.
COMPREHENSIVE PLAN REFERENCE:
The proposed MUD, together with the associated development agreement, is consistent with the adopted guidelines set forth in Envision New Braunfels:
• Action 1.3: Encourage balanced and fiscally responsible land use patterns.
• Action 2.1: Sustain community livability for all ages and economic backgrounds.
• Action 3.30: Encourage and incentivize workforce/affordable housing to attract new workforce entrants and young families.
• Action 6.5: Utilize public/private partnerships to guide growth and investment.
• Action 7.14: Increase tree canopy for increased shade to encourage walking.
• Regional Planning
o Balance resources in an equitable manner that does not lead to disinvestment in existing New Braunfels.
o Assure the long-term fiscal health of New Braunfels, and that policy decisions do not create any undue financial burden on the City or others.
o Ensure that the policy provides guidance for decisions made by utility providers, so they can aid in achieving Envision New Braunfels.
STRATEGIC PLAN REFERENCE:
☒Economic Mobility ☐Enhanced Connectivity ☒Community Identity
☐Organizational Excellence ☐Community Well-Being ☐N/A
Economic Mobility, Objective 5: Establish programs and opportunities that leverage private and public sector dollars for use as gap financing in the production and preservation of affordable workforce housing units. Performance Measures, Output: Increase the number of new affordable housing units produced each fiscal year.
Community Identity, Objective 2: Adopt the new Land Development Ordinance that implements goals of our residents identified in Envision New Braunfels, including but not limited to protecting historic structures, preserving and increasing green space and tree canopy, protecting natural resources, and safeguarding the character, integrity, and stability of neighborhoods.
FISCAL IMPACT:
If the MUD is approved and the territory remains in the City’s ETJ, the City will be required to process the property owners’ plats, incurring staff time and costs in exchange for standard application fees. Future residents or business owners in the MUD will not pay city taxes, however they can have a long-term impact on City infrastructure, for example driving into New Braunfels on City roadways to work, shop, or use City parks.
Recommendation
RECOMMENDATION:
Approval. As proposed, the development agreement would require development within the MUD to be consistent with Envision New Braunfels and the Strategic Plan.
*Note: pursuant to state law, a city may not condition its consent to a MUD on a requirement that the developer agree to annexation, as such, this recommendation is not based, in any way, on the developer agreeing or not agreeing to annexation provisions within the proposed development agreement.
Resource Links:
• Chapter 54 of the Texas Water Code: Municipal Utility Districts <https://statutes.capitol.texas.gov/Docs/WA/htm/WA.54.htm>
• Chapter 42 of the Texas Local Government Code: Extraterritorial Jurisdiction of Municipalities <https://statutes.capitol.texas.gov/docs/lg/htm/lg.42.htm>
• Section 118-4 Development Agreements, of the City of New Braunfels Code of Ordinances: <https://library.municode.com/tx/new_braunfels/codes/code_of_ordinances>