If you buy in the Heritage Public Improvement District, you sign a form before you sign the purchase contract. The Heritage buyer notice follows Texas Property Code §5.014, and both seller and purchaser acknowledge that the notice was delivered before the binding contract date. The form puts a dollar figure on a cost many buyers don't realize they're taking on. In Dripping Springs, more of the cost of growth now sits on individual parcels, while a wastewater plant on the south side of town decides which new subdivisions can connect.
The Form Comes Before the Contract
Heritage is the clearest place to see how this works, because the city publishes the numbers. The Heritage PID service and assessment plan, dated August 18, 2026, assigns assessments parcel by parcel. It does not use a single tax rate. The next installment is due January 31, 2027.
In Improvement Area #1, the 2026 plan shows annual installments of $3,446.83 for one Lot Type 2 parcel and $3,746.56 for Type 3 lots. Further into the community, the October 2025 version of the plan puts the principal assessment for an Improvement Area 3A, Lot Type 8 parcel at $41,728.53, with installments projected through 2055.
Three features set a PID installment apart from an ordinary tax line:
- It is a debt with a balance. Each installment includes principal, interest, collection costs and additional interest, and the plan calls the figures estimates that can change with annual updates.
- It can be paid off. Under the Heritage plan, an owner can prepay all or part of the assessment at any time, with prepayment costs. Paying in full ends the assessment and triggers a recordable termination notice.
- It depends on the lot. Two homes on the same street can carry different installments if they fall in different improvement areas or lot types.
For a buyer comparing two similar listings, a Heritage home at $3,400 to $3,750 a year in installments competes against homes with no PID at all, so the gap shows up in the monthly payment, not the list price. When a home is sold before its assessment is paid off, the remaining balance becomes part of the negotiation, and the §5.014 notice is where that balance first appears.
Where Capacity Runs Short
Lots in new subdivisions need pipes, roads and treatment capacity before anyone can live on them. In Dripping Springs, treatment capacity has been the hardest of the three to get.
According to Community Impact's August 28, 2026 report, the number of wastewater customers the city serves has grown about 600% since 2015. The South Regional Wastewater Reclamation Facility, the city's main treatment plant, has been near capacity for several months and unable to accept most large new connections. Deputy City Administrator Shawn Cox described the limit to the outlet: "It hasn't stopped developments from being able to tie in. It's just we're not going to tie in a large subdivision to it because it can't handle that."
The fix has been in the works for more than a decade:
- 2015: The city applies to the Texas Commission on Environmental Quality for a discharge permit.
- 2019: TCEQ grants the permit. The Save Our Springs Alliance sues TCEQ over concerns about discharge into Onion Creek.
- 2021 to 2022: The city council imposes a temporary development moratorium because wastewater capacity isn't available.
- April 2025: The Texas Supreme Court rules for TCEQ and the city.
- May 2026: The council approves the first wastewater rate increase since 2022.
- December 2026: The city plans to issue a notice to proceed for phase 1.
- 2027: Phase 1 construction is scheduled to start, with Utilities Director Gray Lahrman estimating two and a half to three years to finish it, which puts completion around 2029.
When it's done, the expansion takes the plant from about 162,500 to 822,500 gallons per day. Costs rose during the delay. Community Impact gives the additional Texas Water Development Board financing as $51.5 million in the article text and $53 million in its timeline.
Who Builds Around the Bottleneck
While the main plant takes most large residential connections only in special circumstances, such as an existing agreement, and phase 1 of the expansion isn't expected to finish until around 2029, many of the projects moving forward are the ones that bring their own wastewater solution. Community Impact reported that developments using alternatives will add more than 3,800 lots or units. The city's subdivision tracker and Community Impact's 2026 State of the City coverage name the projects.
| Development | Size, per Jan. 2026 city summary | Wastewater approach |
|---|---|---|
| Double L | 2,231 lots plus 250 senior multifamily units | Reclaimed-water production facility and pump-and-haul |
| Wild Ridge | 863 lots | Its own treatment plant, temporary for phase one |
| Village Grove | 511 units | Its own treatment plant |
| New Growth, US 290 at Roger Hanks Parkway | 240 units per city tracker, 245 lots per Community Impact | Waiting for South Regional capacity |
Double L, Wild Ridge and Village Grove come to 3,855 lots and units, which accounts for most of the near-term new supply. The city has approved only three pump-and-haul plans in recent years, according to Community Impact, so this route stays narrow. New Growth, which planned to use the city system, is waiting. Over the next few years, how much a builder can spend on wastewater infrastructure matters more than demand in deciding which new neighborhoods get built.
The same January summary lists Cannon Ranch at 375 lots, Ranch at Caliterra at 234 and Ariza Springs at 293. Our research didn't confirm how the developer-built plants are financed or what homeowners in those communities will pay for sewer service. Those are questions for the seller and the title commitment on any specific home.
A Tax Rate That Stayed Flat While Its Purpose Changed
Municipal utility districts make the shift easiest to see. They are the other common way Texas spreads infrastructure costs across the homes that use it. Headwaters MUD's posted tax history shows the same total rate, $0.90 per $100 of taxable value, every year from 2020 through 2026. Over those same years, the split behind that total flipped.
| Tax year | Maintenance & operations | Debt service | Total |
|---|---|---|---|
| 2020 | $0.4000 | $0.5000 | $0.9000 |
| 2022 | $0.2750 | $0.6250 | $0.9000 |
| 2024 | $0.1000 | $0.8000 | $0.9000 |
| 2025 | $0.0250 | $0.8750 | $0.9000 |
| 2026 | $0.0000 | $0.9000 | $0.9000 |
By tax year 2026, the whole rate goes to debt service. Revenue for debt service rose from $612,844 in 2020 to $5,869,611 in 2025, as the district's tax base grew and more of each dollar went to repaying bonds. To an owner, the rate looks unchanged. In practice, every dollar of it now repays borrowed money.
At $0.90 per $100, the district portion comes to $900 a year for every $100,000 of taxable value. On a home with $500,000 of taxable value, that's $4,500 a year before any city, school or county tax.
The Rest of the Parcel's Bill
District charges sit on top of the standard taxing units, so comparing homes means comparing full bills. Hays County's 2025 adopted rate schedule lists these rates per $100 of taxable value for tax year 2025, the most recent county-wide schedule in our research:
- City of Dripping Springs: $0.2267
- Dripping Springs ISD: $1.1052
- Hays County: $0.3573
- Dripping Springs MUD No. 1: $0.7600
- Wild Ridge MUD: $0.8722
Tax year 2026 rates may be different. The county's Tax Estimator lists Headwaters MUD and Dripping Springs MUD 1 as special-district options. Still, a community's name doesn't tell you which districts cover a particular parcel. That comes from the parcel record itself.
City sewer customers are paying more too. Starting with September 2026 bills, the residential base fee went from $28.88 to $43.32 and the usage charge from $4.05 to $5.67 per 1,000 gallons. At the average of 6,578 gallons a month, Community Impact reported a typical bill rising from $55.52 to $80.62, an increase of more than 45%. Lahrman told the outlet the main driver was growth in the customer base and the operating demands that came with it.
Questions Buyers Ask About Dripping Springs Districts
Does a PID installment go away when the home sells? Not automatically. In Heritage, the assessment stays with the parcel until it's paid in full. Payoff, partial or complete, is allowed with prepayment costs, and full payment ends the assessment.
Will the wastewater expansion lower anyone's bill? Our research doesn't support that. Expansion adds capacity, and the city raised rates in 2026 to cover rising operating costs.
Which districts cover Caliterra, Big Sky Ranch or Driftwood? We couldn't confirm parcel-level district assignments for those areas. The county schedule lists a Driftwood Conservation District at $1.0000 and a Driftwood Economic Development MMD at $0.1500 per $100 for 2025, but it doesn't say which parcels fall inside them.
Before you compare two Dripping Springs homes on price, line up each parcel's PID balance, district debt rate and sewer provider next to each other. CBSrealty pulls those documents early, so the §5.014 notice holds no surprises when it reaches your inbox. Call Chet for a free home consultation and bring the addresses you're considering.
This article is general information, not legal, tax or financial advice. Consult a qualified professional about your situation.
