Thursday, June 02, 2005

Growing Numbers of Master-Planned Communities Create More Special Utility Districts, Reports Dallas ULI Conference

This is a press release from the Urban Land Institute, forwarded by Fred Pilot, that is well worth reading. I have been arguing for twenty years or so that HOAs are part of a larger transformation of local government, from large general purpose governments to small special purpose districts. Well, here is the blueprint, laid out at at meeting of the leading real estate development think tank.

The evolving popularity of large master-planned communities is a major catalyst in the development of more Special Districts (Municipal Utility Districts or MUDs) and special water districts in North Texas, according to some of the Southwest's most knowledgeable developers and land planners. Special Districts in the North Texas residential market, along with hospitality trends in North Texas, were two major focus points of the Urban Land Institute's North Texas 1-Day Conference last week in Las Colinas. "Special Districts are now the trend for large master-planned communities," said Phillip Huffines of Huffines Communities Inc. Huffines, whose two communities, Providence and Savannah, had 771 combined annual starts in 2004 in Special District communities, said the new type of utility design has become necessary in order to fund the amenities and infrastructures that consumers want.

1 comment:

Anonymous said...

While the ULI reports the growth of special districts has accompanied the growth of master planned residential developments, some important distinctions should be kept in mind.

Special districts are governmental entities, while master planned communities are governed by private entities known as homeowner associations. Special districts are funded by income tax deductible property tax assessments, while HOAs are funded by nondeductible HOA assessments.

As you have reported, HOAs have faced numerous and fundamental difficulties as viable and sustainable forms of local government. I wouldn't be surprised to see HOAs superceded by special districts in many areas of the U.S. in the coming years.