BY ELENI HIMARAS
reporter@ltview.com
The Lakeway City Council voted unanimously Tuesday, Feb. 17, to authorize the city attorney to pursue legislation that would allow the municipality the option of annexing the Lakeway Municipal Utility District at a future date.“Municipal utility districts are created to provide interim utility service to areas that are not covered by any other municipality,” City Manager Steve Jones told the council. “It is reasonable for the city to consider annexation of the district.”
Mayor Steve Swan said the city would like to see LMUD customers served in a more representative manner.
“A quarter of their customers, who are citizens of the City of Lakeway, cannot even vote in LMUD elections,” Swan said, “These are residents who only receive water service. Only LMUD customers who receive sewage service, known as ‘in-service’ customers, may vote in their elections. So these water-only customers have no voice in the election process, no voice on how water rates are set, nor the retirement of debt. Since virtually all of LMUD falls within the city limits, a case can be made that LMUD deserves closer public scrutiny. We welcome that at the city. We believe all citizens LMUD serves deserve elected representation, The reason this issue hasn’t been looked at by the city in 18 years because of LMUD’s boundaries.”
The reason LMUD does not allow water customers to vote is because only sewage customers pay property taxes.
When a MUD falls completely within the confines of a city, under state law, the city may annex it at will. According to the city, LMUD has small coverage areas in Point Venture, The Hills, and the Austin ETJ, serving only a few customers in The Hills. Swan said it is LMUD’s unique boundaries that require Lakeway to seek special legislation.
“We are not suggesting the city should necessarily take over LMUD,” Swan said. “But do believe the city deserves have the ability to be on the footing it should have been on all along. Let the public decide.”
LMUD President Tom Rogers warned an annexation could be expensive.
“How much is the city willing to spend on lobbyists and lawyers?” Rogers asked the council in a prepared statement. “There are hundreds of other districts in the Houston area alone that will oppose this. Are you willing to risk your money to fix something that is not broken?”
He went on to praise the work of LMUD General Manager Richard Eason and said, “When people ask the TCEQ where they can go to see how a municipal utility district should be operated, the TCEQ sends them to us.”
Rogers was the only member of the public at the meeting to take advantage of the citizens’ comments portion of the agenda item.
Councilman Dave DeOme replied that the council is not prepared to discuss annexing the LMUD at this point. Rather it is simply looking to “level the playing field” pending a future study on the feasibility of annexation.
“We’re not pro-conning this [weighing the pros or cons of annexation],” he said.
The city has approached State Sen. Kirk Watson about drafting the legislation that would allow the annexation.
“Any time one of my mayors and councils asked me to look at something, I look at it,” Watson said, adding that he was still in the process of deciding whether to carry the legislation. “We are doing due diligence on it right now.”
Watson said that, in deciding whether to carry the legislation, he is looking into what is best for his constituents in the area and how to best go about it. If he were to write the legislation, questions of how to word it would become the main issue.
While Watson said it was not uncommon for cities and MUDs to disagree, this is the first case he has dealt with where the MUD had boundaries beyond the city limits. He said he will research how this particular MUD was formed, its history and what annexation would mean for taxpayers.
“I’m not ever going to be in favor of something that upon annexation would cost people more money than they are currently paying,” Watson said.