Prior to 2017, Texas law allowed cities to annex anywhere they wanted without any vote of the landowners in the area. However, any Municipal Utility District (MUD) in the area was able to sign a Strategic Partnership Agreement (SPA) with the city to govern how the MUD would hand over its assets to the city upon annexation.
In 2014, the Shady Hollow MUD signed a SPA with the City of Austin that provided for full annexation in December 2020. Under the SPA, the City of Austin began manning the Fire Station on Brodie Lane in June 2017, and the City took over billing for the water and sewer service in April 2018, charging the MUD’s rates until full annexation in December 2020.

Property taxes will increase dramatically as well as costs for water and sewer service. Even if you live outside the MUD’s taxable boundaries and won’t get annexed, the City will take over your water or sewer service from the MUD and raise your rates when it annexes your neighbors inside the MUD.

In 2017, the Texas Legislature passed SB 6, which changed the annexation procedures to require a city to give a vote to the homeowners in certain areas before annexing them. Unfortunately, SB 6 says that a city does not have to give a vote to homeowners inside of a MUD’s taxable boundaries if the MUD signed a SPA. As a result, Shady Hollow homeowners inside Shady Hollow MUD’s taxable boundaries do not get a vote but homeowners outside the taxable boundaries would likely get a vote. In December 2017, the City of Austin changed its position and said that it does not plan to annex Sections 1 and 2, Shady Hollow West, and the Estates of Shady Hollow at this time (about 20% of its customers), but it is proceeding with annexation of the homeowners inside Shady Hollow MUD (about 80% of its customers) without a vote.

To prevent the City of Austin from splitting up Shady Hollow HOA, SB 6 should be fixed by amending Local Government Code Section 453.052(h)(3(B) to require a city to use the applicable voting procedures in order to annex an area inside a MUD if that MUD serves water or sewer customers outside its taxable boundaries and the SPA requires the MUD to hand over its infrastructure to the city in those outlying areas.

The HOA cannot use its membership dues to pay a lobbyist to fix SB 6, so some HOA Board Members have set up a Texas Unincorporated Nonprofit Association called Shady Hollow Vote for Everyone (SHAVE) to collect voluntary donations to pay a lobbyist to fix SB 6 to guarantee a vote on annexation for every member of Shady Hollow HOA. Your donation will be used by SHAVE to send a lobbyist to the Legislature and to pay the administrative expenses of SHAVE, including governmental fees and insurance premiums. Your donation is NOT tax deductible (SHAVE is not a charity).

Contributions to SHAVE are not deductible for federal income tax purposes as charitable contributions.