If you own a homestead in Leander and live in a Municipal Utility District, which taxing unit gets the most of your money? For a typical home in Leander MUD No. 1, No. 2 or No. 3, it's the MUD. It takes more than Leander ISD, and the gap is wide.
Here's the reason. Williamson County's 2026 tax rate table lists all three districts at $1.00 per $100 of value. Leander ISD's adopted 2026 rate is $1.1169, just slightly higher. The school district, though, taxes your home only after a $140,000 homestead exemption. The county's 2026 exemption table shows no homestead exemption for any of the three MUDs. So the school district applies a slightly higher rate to a much smaller number, and the MUD applies its rate to your whole value.
One house, worked out line by line
Start with Williamson Central Appraisal District's 2026 average residential value for Leander. Community Impact reported it at $465,503, down 2.85% from the year before. The table below applies the 2026 adopted rates and the homestead exemptions in the county's 2026 exemption table to that value, for a home inside the City of Leander and Leander MUD No. 1, 2 or 3.
| Taxing unit | 2026 rate per $100 | Homestead exemption | Estimated tax |
|---|---|---|---|
| Leander MUD No. 1, 2 or 3 | $1.000000 | None | $4,655 |
| Leander ISD | $1.116900 | $140,000 | $3,636 |
| City of Leander | $0.417282 | $5,000 or 1%, whichever is greater | $1,922 |
| Williamson County | $0.381218 | $5,000 or 5%, whichever is greater | $1,686 |
| Williamson County FM/Rd | $0.040329 | $3,000 | $187 |
| Total | $12,086 |
In this example, the MUD comes to about 38% of the bill. It's the biggest single line, and it's about $1,000 more than the school tax. Some charges are left out, such as an Austin Community College levy, which ACC set at $0.103643 for parcels inside its taxing boundaries. Real bills are also calculated on taxable value, which can be lower than market value. Treat this as a model of how the pieces fit together, not a prediction of any one parcel's bill.
Why the state's bigger exemption helps less here
When Texas voters approved Proposition 13 on November 4, 2025, the school-district homestead exemption went from $100,000 to $140,000, effective for the 2025 tax year. The Texas Comptroller lists an additional $60,000 for owners who are 65 or older or have a disability, for a total of $200,000. The constitutional text applies that exemption to public school taxes. Any other taxing unit has to adopt its own exemption.
At Leander ISD's 2026 rate, the $140,000 exemption cuts about $1,564 from the school line. That's real money. But it only reduces one line on the bill. The more of a bill the MUD makes up, the smaller the share the state exemption actually covers. In a $1.00 MUD it covers less than in a $0.35 or $0.40 district, even when the house, the value and every other rate are the same.
A flat rate that now goes mostly to bonds
The $1.00 rate looks like it hasn't changed. Over the past five years, it hasn't. The county's rate table breaks each MUD rate into two parts: maintenance and operations, and debt service. That split has moved a lot.
| District | 2022 debt rate | 2022 M&O rate | 2026 debt rate | 2026 M&O rate |
|---|---|---|---|---|
| Leander MUD No. 1 | $0.400 | $0.600 | $0.925 | $0.075 |
| Leander MUD No. 2 | $0.300 | $0.700 | $0.925 | $0.075 |
| Leander MUD No. 3 | $0.000 | $1.000 | $0.700 | $0.300 |
The county's table defines the debt rate as the part of the adopted rate needed to pay the unit's debt service for the coming year. In MUD No. 1 and No. 2, 92.5 cents of every dollar of MUD tax now goes to debt. MUD No. 3's January 2025 board agenda included issuing $4,615,000 in Unlimited Tax Bonds, Series 2025, along with approving reimbursable costs and distributing bond proceeds.
This matters for anyone who reads a flat rate as stable or about to come down. A rate that mostly pays bonds is backing debt that was already issued. The table shows the operating share shrinking while the debt share grows. No year in it shows the total rate going down.
Where these districts sit, and what nearby districts charge
Community Impact identified homes in the Bar W Ranch neighborhood as being in Leander MUD No. 2. MUD No. 3's engineering reports have covered Bar W Ranch West Phases 9 and 11. That same agenda discusses conveying a shared amenity parcel to MUDs 1 and 2.
Elsewhere in Leander, two districts have much lower rates:
- Leander TODD MUD No. 1, $0.35 in 2026. Its bond official statement describes a district of about 538 acres, with Bryson MPC Holdings LLC as its active developer and Bryson as the subdivision. It covers $7 million in unlimited tax bonds for water, wastewater and drainage, plus $4.5 million in road bonds.
- Palmera Ridge MUD, $0.40 in 2025 and 2026. Its September 2025 agenda included $3.75 million in road bonds and an engineering item for Palmera Bluff Section 9. A September 2025 Moody's report said the district expected one or two more bond issues, totaling less than $10 million over four years, without raising its tax rate.
Here's the same $465,503 homestead with only the MUD line changed:
| MUD | 2026 rate | MUD tax | Modeled total bill |
|---|---|---|---|
| Leander MUD No. 1, 2 or 3 | $1.00 | $4,655 | $12,086 |
| Palmera Ridge MUD | $0.40 | $1,862 | $9,293 |
| Leander TODD MUD No. 1 | $0.35 | $1,629 | $9,060 |
That's a gap of roughly $2,800 to $3,000 a year from the MUD rate alone, before a buyer compares lot size, HOA dues or price. Spread over a monthly mortgage payment with escrow, it comes to about $230 to $250 a month. That can be enough to change which house fits a budget.
The November 3 vote puts the school line in play
Leander ISD's $1.1169 rate includes three extra cents for maintenance and operations. The district says those cents depend on voters approving them in the November 3, 2026 school funding election. If voters don't approve them, the rate goes back to the 2025 level of $1.0869. On the model home, that's about $98 a year, bringing the school line to roughly $3,538. Under either result, the school line stays more than $1,000 below the MUD line in MUDs 1, 2 and 3. Check Leander ISD's page for the certified election result before you finalize a budget.
Checking a specific address
Leander ISD's site points homeowners to Texas.gov/PropertyTaxes, which links to your local property tax database. That database lists every taxing unit on a parcel and what each one charges. When you compare two Leander homes, it helps to pull these four things for each one:
- The MUD name and its 2026 rate from the county table, not just the total rate on a listing sheet.
- The debt and M&O split for that MUD, which shows how much of the rate goes to bonds.
- Whether the parcel is inside the City of Leander, and whether ACC applies.
- Which appraisal district handles it. Leander crosses into Travis County, and the Travis Central Appraisal District uses the same protest deadline rule as Williamson's, May 15 or 30 days after the notice is mailed, whichever is later.
Quick answers
Does the $140,000 homestead exemption reduce MUD taxes? No. It applies to school district taxes. Williamson County's 2026 exemption table shows no homestead exemption for Leander MUD Nos. 1, 2 or 3, Leander TODD MUD No. 1, or Palmera Ridge MUD.
Does the City of Leander offer a homestead exemption? Yes. The county's 2026 table lists it as $5,000 or 1% of value, whichever is greater, plus $10,000 for owners who are 65 or older or have a disability.
Did the City of Leander raise its rate for 2026? No. Community Impact reported that the council kept the rate at $0.417282. Williamson County adopted its no-new-revenue rate of $0.421547.
This post is general information, not legal, tax or financial advice. Please confirm your own exemptions, rates and bill with your appraisal district, tax office or a qualified tax professional.
When you're comparing homes in Bar W Ranch, Bryson, Palmera Bluff or anywhere else in Leander, the team at Four22 Realty Group can help you line up the MUD, school and city rates for each address, so your monthly payment is clear before you write an offer. Start Your Move Today.
