Frequently Asked Questions

On Feb. 4, 2025, the New Fairview City Council voted to hold an election for the establishment of a special purpose district to fund economic development. The election to create a Municipal Development District (MDD) for New Fairview will appear on the municipal general election ballot on May 3, 2025.

What is an MDD (Municipal Development District) and how does it work?

Initially established by the Texas Legislature in 1997 and revised in 2005 to allow all cities to participate, a Municipal Development District (MDD) is a special purpose district created by a city to promote and fund development projects in the community. MDDs are designed to fund infrastructure improvements, and create and/or promote economic growth, support local businesses and attract new investment. MDD revenue cannot be used for employee salaries and it will not eliminate the half-cent property tax reduction residents currently enjoy. By law, the MDD revenue generated can only be used for:

Public art and beautification
Infrastructure improvements
Business development
Community facilities
Convention centers

The district’s boundaries are the city limits, and will also include the ETJ (extra territorial jurisdiction). State law requires that the district be established by an election of voters who reside inside those specifically adopted boundaries.

If this ballot measure is approved by district voters, the MDD for the City of New Fairview will be funded from a half-cent sales tax.

This earmarked funding would be used to develop and finance projects to benefit the community while also encouraging private economic development that would generate additional tax revenue for the city.

What are the specific New Fairview MDD boundaries and who can vote in the election?

The boundaries of the MDD, in which the sales tax will be collected, are the New Fairview city limits and the city’s ETJ (Extra Territorial Jurisdiction). Registered voters in these areas are eligible to vote in the MDD election. Your ballot will clarify your egibility.

The subdivisions in the New Fairview ETJ include:

Diamond Ridge
Fairview Meadows
Falcon Ridge
Hawk Ridge
Heritage Creek VI
High Mesa Estates
Highland Meadows Addition
Hills Oliver Creek
King Rest Estates
Old Chisholm Estates
Oliver Creek Ranch Phase I
Oliver Creek Ranch Phase II
Ski Haven

How can MDD funds be used?

Infrastructure improvements – road construction, sidewalks, street lighting, drainage systems and other public infrastructure in the city.
Business development – Financial assistance to attract new businesses to the area, support expansion of existing businesses and incentivize job creation.
Community facilities – New construction or improvements to public spaces such as parks, recreation centers, libraries or community/civic centers.
Convention centers – New construction or improvement of convention centers or meeting facilities that would attract large events or boost tourism.
Public art and beautification – Funds may be allocated for public art projects or beautification efforts to enhance the city’s aesthetic appeal.

How will the district be managed?

If voters approve this ballot measure, a board for the MDD will be established with members appointed by the New Fairview City Council. Board members must be residents of the MDD district (city limits and ETJ).

The district must also establish a development project fund, which may have separate accounts within the fund. The district must deposit the sales tax proceeds and any other revenue into the fund. The money in the fund may be used to pay costs associated with development projects in the district

Will the MDD impact my property taxes?

No. Establishment of the district will only increase the sales tax rate in the ETJ by a half cent. There is no sales tax increase in the city limits of New Fairview. Upon voter approval, a half-cent of the total sales tax collection will be a reallocation to the MDD. The funds generated will come from anyone who purchases taxable items within New Fairview and its ETJ.

Like most municipalities in Texas, New Fairview uses the sales tax collected to supplement its general fund budget thereby relying less on property taxes to fund city services. As a matter of policy, New Fairview dedicates a half cent of its general fund sales tax collection specifically for property tax relief. This policy will not change.

No matter the outcome of the election, a half-cent of the one cent dedicated to the general fund will still be used for property tax relief. It is earmarked as general fund because the sales tax collected supports the city’s efforts to keep property taxes low. That’s why it’s important to shop local – those dollars stay in New Fairview. Among the MDD funding plans – economic development for the city.

How would approval of the MDD impact sales tax for New Fairview?

City Limits Sales Tax – Current

6.25 cents – State of Texas
.50 cents – Wise County
1.00 cents – New Fairview
8.25 cents – Total Sales Tax

Wise County ETJ Sales Tax – Current

6.25 cents – State of Texas
.50 cents – Wise County
6.75 cents – Total Sales Tax

Denton County ETJ Sales Tax – Current

6.25 cents – State of Texas
6.25 cents – Total Sales Tax

City Limits Sales Tax With the MDD

6.25 cents – State of Texas
.50 cents – Wise County
1.00 cents – New Fairview
.50 cents – New Fairview MDD
8.25 cents – Total Sales Tax

Wise County ETJ Sales Tax Current With MDD

6.25 cents – State of Texas
.50 cents – Wise County
.50 cents – New Fairview MDD
7.25 cents – Total Sales Tax

Denton County ETJ Sales Tax With the MDD

6.25 cents – State of Texas
.50 cents- New Fairview MDD
6.75 cents – Total Sales Tax

Are other communities approving MDDs for infrastructure improvements and to promote economic growth?

Yes. Voters in several North Central Texas communities including Aubrey, Aurora, Boyd and Pilot Point, have approved Municipal Development Districts in recent years. As explosive growth continues throughout the region, these cities are using sales tax revenue generated through MDDs to provide infrastructure improvements and economic development investment.

Project examples of how other cities are using MDD funds.

The projects that are not permissible are educational facilities, municipal buildings such as city hall, police, or fire, sewage systems for the public, and residential city street construction or repair. Following, are cities in the North Texas Region with Municipal Development Districts and how they are using the funds:

The City of Azle MDD

Community Caring Center: A non-profit expansion at 317 Commerce St.
Azle Retail Development: A commercial speculative development at 700 Block of FM 730 N.
CRAVE: A restaurant relocation at 317 W Main St.

The City of Aubrey MDD

Lift Stations related to the Park
Main Street Sidewalks
Water Main Rehabs in several locations related to park and business access