10 min· water· building
1,527 water boards in Texas
Texas pays for suburban water and sewer through municipal utility districts, each with its own board, bonds and tax rate. How that works, how other states organize their utilities, and what it changes for anyone selling to them.
Texas has 1,527 active municipal utility districts. I counted them this week in the water districts dataset the Texas Commission on Environmental Quality (TCEQ) publishes on the state's open data portal. Each one has five elected directors, its own bonds and its own tax rate. Most of them exist because a developer needed water and sewer lines for a subdivision outside a city.
I went looking because of a question that keeps coming up when we map US water utilities: who signs the purchase order? In most of the country the answer is a city or county utility, and in some states an investor-owned company. In the suburbs of Houston, Austin and Dallas-Fort Worth it is often a district board of five people that meets once a month.
I believe the way a state organizes its water utilities tells a vendor more about a sale than the size of the territory does. It decides who signs, which documents show a project early, and how long the yes takes. So I read through how all 50 states do it, with a closer look at Texas.
1. The national picture
EPA's Safe Drinking Water Information System (SDWIS) lists 49,342 active community water systems as of 10 November 2026. Local governments own 24,094 of them and serve about 281 million people. Private owners hold 22,496, almost as many, but most are small systems for subdivisions, mobile home parks and the like, and together they serve about 37 million people.
Values
| Tier | Systems | People served (millions) |
|---|---|---|
| Local government | 24,094 | 281.3m |
| Private | 22,496 | 37.4m |
| Other | 2,752 | 13.1m |
The size split is sharper still. The 4,601 systems that serve more than 10,000 people cover 84% of everyone on a community system, and local governments own 3,940 of them. At the other end, 26,488 systems serve 500 people or fewer, and private owners hold 18,529 of those.
Every state builds from the same five blocks:
- City and county utility departments, run by a council or a county board.
- Investor-owned utilities, whose rates a state public utility commission sets in rate cases.
- Special-purpose districts with their own elected boards, paid for by property taxes and rates.
- Authorities created by one or more governments, with appointed boards.
- Member-owned nonprofits: water associations, rural water districts and, in Texas, water supply corporations.
What changes from state to state is the mix.
- DE: 61.2 %
- NJ: 38.7 %
- CT: 36.8 %
- ID: 36.4 %
- KY: 36.4 %
- WV: 31.5 %
- PA: 31.3 %
- AK: 27 %
- MO: 26.9 %
- LA: 26.8 %
- NH: 24.7 %
- AZ: 21.6 %
- IN: 21.2 %
- CA: 18 %
- SD: 17.5 %
- IA: 17.2 %
- ME: 17 %
- OH: 15.8 %
- ND: 15.6 %
- VT: 13.3 %
- MT: 12.7 %
- IL: 10.3 %
- NM: 9.4 %
- NC: 9.4 %
- WY: 7.4 %
- WA: 7.2 %
- FL: 6.9 %
- VA: 6.7 %
- NY: 6 %
- SC: 5.1 %
- OR: 4.7 %
- HI: 4.3 %
- RI: 4 %
- CO: 3.8 %
- TX: 3.3 %
- AR: 3.2 %
- TN: 3.1 %
- UT: 3 %
- KS: 2.9 %
- GA: 2.7 %
- NV: 2.7 %
- MI: 2.3 %
- MS: 2.1 %
- WI: 2.1 %
- MD: 1.8 %
- MA: 1.7 %
- OK: 1.3 %
- NE: 1.2 %
- MN: 1.1 %
- AL: 1 %
- DC: 0 %
- US overall, 11%
Delaware, New Jersey and Pennsylvania sit at the top. These are states where the large investor-owned companies grew by buying municipal systems. Pennsylvania's Act 12 of 2016 lets a buyer put the fair market value of an acquired water or wastewater system into its rate base, which made those purchases easier to recover. Texas sits at 3%, with most of the South and the Plains.
One caution on these numbers. States report the owner type to EPA themselves, and they do not all code it the same way. Texas codes most of its 740 nonprofit water supply corporations as local government, which makes the state look more public than it is.
2. How a Texas MUD works
A developer buys raw land, usually outside city limits. It petitions TCEQ to create a municipal utility district (MUD), or the Legislature creates one by special act, and a city has to consent if the land sits in its extraterritorial jurisdiction. The district is a political subdivision under Article XVI, Section 59 of the Texas Constitution, governed by a board of five directors (Water Code §54.101).
The developer fronts the cost of the water, sewer and drainage lines. Once there are enough homes and taxable value, the district sells bonds for its waterworks, sanitary sewer and storm sewer (§54.501). Before most of those bonds can be sold, TCEQ has to find the project feasible and approve it by order (Water Code §49.181), and the Attorney General has to approve the bonds (Government Code §1202.003). The bond money repays the developer. The homeowners who move in pay the bonds off through a property tax on everything in the district (§54.503), plus their water and sewer rates.
A MUD usually has no staff of its own. Barker Cypress MUD in Harris County is a typical example: its website lists six outside firms: Schwartz, Page & Harding as attorney, Wheeler & Associates as tax assessor, McLennan & Associates as bookkeeper, Quiddity Engineering as engineer, Masterson Advisors as financial advisor, and Inframark as operator. The board makes the decisions, and those six firms do the work and bring the board its options. The same firms tend to serve many districts in one metro, which is worth knowing if you sell to them.
- Municipal utility districts: 1,527 districts
- Water control and improvement districts: 231 districts
- Municipal management districts: 167 districts
- Groundwater conservation districts: 101 districts
- Special utility districts: 83 districts
- Fresh water supply districts: 71 districts
- River authorities: 30 districts
Only 661 drinking water systems in SDWIS carry a MUD name, for 1,527 active MUDs. Many MUDs buy treated water from a city, a regional authority or a neighboring district, or share one plant among several districts. Each of them still has its own board and its own budget.
Texas has other kinds of districts too. Water control and improvement districts (Water Code ch. 51) are older and broader than MUDs, with 231 active. Special utility districts (ch. 65) serve rural and suburban areas with five to eleven directors, and there are 83 of them. The 740 water supply corporations in SDWIS (ch. 67) are nonprofits owned by their members, the Texas version of a rural water association, and serve about 2 million people. Above them sit the river authorities, created by special acts of the Legislature to run reservoirs and sell water wholesale. Eighteen of them are under limited review by the Sunset Advisory Commission.
3. Who decides what in Texas
Since 1 September 2014, the Public Utility Commission of Texas (PUC) has held water and sewer rate jurisdiction and service areas, which HB 1600 moved over from TCEQ. An investor-owned utility or a water supply corporation needs a certificate of public convenience and necessity from the PUC to serve retail customers (Water Code §13.242). The PUC sets investor-owned utility rates and hears rate appeals from customers of water supply corporations, districts, and city utilities that serve outside city limits (§13.043). Inside their own limits, cities set their own rates (§13.042). TCEQ keeps drinking water quality, district creation and bond review.
Two newer pieces shape where MUDs go next. A city and a district can sign a strategic partnership agreement that defers full annexation (Local Government Code §43.0751). And since 1 September 2023, landowners or voters can petition to take their land out of a city's extraterritorial jurisdiction (SB 2038), which gives developers more room to form districts outside a city's control.
4. Other states with their own formats
Pennsylvania runs much of its water and sewer through municipal authorities, created by one or more municipalities and run by appointed boards. The state's Department of Community and Economic Development estimates more than 1,500 active authorities of all kinds, and the 2022 Census of Governments counts 1,077 Pennsylvania special districts whose single job is water supply, sewerage or both. That is the most of any state. Texas is next, at 572.
Colorado's metropolitan districts are the closest cousin of the MUD. A developer forms a district under Title 32, the district borrows against future property taxes, and the residents pay it back. The State Auditor counted more than 2,900 special districts in March 2026, about 2,300 of them metro districts. Florida's community development districts (F.S. ch. 190) follow the same idea. The difference shows up in SDWIS: it lists 69 Colorado systems with a metro district name and 3 Florida systems with a CDD name. Most of those districts hand their finished pipes to a city or county utility, and the city stays the buyer. A Texas MUD more often owns its system, so each one buys for itself.
Florida has a second twist. Its Public Service Commission regulates private water utilities only in counties whose commissioners opt in (F.S. 367.171). The PSC's county chart lists 40 counties in and 27 out.
California stacks every block on top of each other: city departments, hundreds of special districts, small mutual water companies owned by their customers (SDWIS lists 416 systems with "mutual" in the name), joint powers authorities and large wholesalers. The Metropolitan Water District of Southern California sells to 26 member agencies serving 19 million people. The CPUC regulates more than 100 investor-owned water and sewer utilities serving about 16% of Californians, and nine large ones serve about 95% of that group.
Arizona has many small private companies. The Corporation Commission regulates nearly 350 of them, running more than 400 water systems, beside large city utilities and the Central Arizona Project.
In three states the commission also reviews publicly owned systems. The Public Service Commission of Wisconsin oversees more than 575 drinking water utilities, municipal ones included. The Kentucky PSC covers water districts and water associations. Maine's utility code treats water districts as consumer-owned water utilities. In those states a city's rate increase goes through a state case, and the capital plan behind it goes on the public record.
Kansas and Oklahoma run their farm country on rural water districts organized under state law (K.S.A. 82a-612, 82 O.S. 1324.1). SDWIS lists about 255 of them in Kansas and 294 in Oklahoma.
5. What to do with this on Monday
If you sell into the Texas suburbs, open the TCEQ water districts dataset on data.texas.gov, filter it to active MUDs in your counties, and look up each district's website. Most of them post their consultants and their next board meeting, the way Barker Cypress does. When a district applies to TCEQ to approve a bond issue, the application carries an engineer's report describing the project, with its maps and plans (Water Code §49.181(b)). That report shows what the district is about to build, before any bid.
If you sell in Delaware, New Jersey, Pennsylvania or parts of California and Arizona, read the rate case filings at the state commission, where the investor-owned companies lay out multi-year capital plans. In Wisconsin, Kentucky and Maine, the same filings exist for public systems too.
What I have not confirmed yet, as of 10 November 2026: the number of active Florida community development districts. FloridaCommerce keeps the official list of special districts, and I could not open it. The Census counted 1,374 special districts of every kind in Florida in 2022, without a CDD breakdown.
AquaIntel maps US water utilities by owner and structure from public records such as SDWIS, so a vendor can see who signs before an RFP appears. In Texas it links each district to its TCEQ district number as well as its drinking water system ID, so a MUD that buys its water from a neighbor still shows up as a buyer of its own.
Sources
- US EPA, Safe Drinking Water Information System, via Envirofacts, active community water systems, pulled 10 Nov 2026.
- TCEQ, Texas Water Districts dataset, Texas Open Data Portal, November 2026.
- Texas Water Code ch. 13, ch. 49, ch. 51, ch. 54, ch. 65, ch. 67.
- Texas Government Code ch. 1202 and Local Government Code ch. 43.
- Texas Legislature, HB 1600 (2013) and SB 2038 (2023).
- Sunset Advisory Commission, River Authority Uniformity Review, November 2024.
- Barker Cypress MUD, Consultants.
- US Census Bureau, 2022 Census of Governments, table CG2200ORG08, special district governments by function and state.
- Pennsylvania DCED, Municipal Authorities in Pennsylvania, 2020.
- Pennsylvania, Act 12 of 2016.
- Colorado Office of the State Auditor, special districts fiscal health report, 2026.
- Florida Statutes ch. 190 and ch. 367; Florida PSC, county jurisdiction chart.
- CPUC Water Division; Metropolitan Water District of Southern California.
- Arizona Corporation Commission, water.
- Public Service Commission of Wisconsin; Kentucky PSC; Maine Revised Statutes, 35-A §6101.
- K.S.A. 82a-612; Oklahoma Statutes, Title 82.