However, Smothers stated that MUDs can negotiate with the City of Houston so that the city can provide services such as pursuit, fire protection and pet exploitation as long as services are appropriate. “The city is not doing anything for the money they receive, and that was a constant concern on my part. We have $6 million that leaves District 126 in Houston every year for nothing. “MudDs were created as a bridge in non-community areas, which should eventually be annexed by the city,” he said. “If the City of Houston does not intend to cancel these areas, we should find a way for counties and MUDs to work together [to provide services].” Most spring and small MUDs do not receive fire or enforcement services because they are too far from the city. Cole said he thought the MUD and the city would not need to provide many infrastructure improvements if the county increased property tax revenues to fund these improvements. Cole said the VAT revenue made available to the city also helps pay for the infrastructure that residents of these neighborhoods use outside of Houston, as by road. While MUDs spend within their borders, the City of Houston is not required to spend a partially annexed amount in the region. Although revenues from LPA agreements continue to increase, the number of LPAs increased in the spring and Klein signed contracts with the city in 2013 and 2014. “The neighborhood got older and older and [council members] thought that if they made [an LPA deal] with the city of Houston, they could go back inside and put that money in the community,” Parker said. In 2007, the District entered into a Strategic Partnership Agreement (SPA) with the City of Houston. The BSG authorizes the annexation of part of the district by the city, but for limited purposes. Under the GSB, commercial areas along West Road and State Highway 6 have been annexed for limited purposes, and these areas are one per cent (1%) local sales and usage tax. Under the BSG, the borough receives half (0.5%) and the city half.
One of the provisions of the G.S.O. is that, for the duration of the agreement, which is thirty years old, the City of Houston will not be annexed to residential areas in the District. The limited annexation came from the 1999 Texas legislature, said Nicole Smothers, director of the City of Houston`s Community Sustainability Division. Thanks to the limited annexation, cities and MUD can allocate 1% of TAXE revenues into areas where they are available, and the city agrees not to annex districts for a certain period of time, usually 30 years. In a region without central governance, agreements to annex limited objectives between the City of Houston and municipal services have helped fund millions of improvements to Spring and Klein since 2003.