Utility Fees When You Buy a New-Construction Home: What Shows Up at Closing

On most new homes the water, sewer and meter fees were paid by the builder months before closing and sit inside the purchase price, so they never appear as a line on your Closing Disclosure. What can appear, or follow you after closing, are three other things: a charge the contract passes through to you, a prorated special-district assessment, and the district tax or assessment itself. That last one can be large. In Fort Bend County MUD 5 the 2025 tax rate is $1.24 per $100 of value, or about $4,960 a year on a home valued at $400,000, and Texas law requires the seller to tell you that the cost of district facilities is not included in the purchase price.

For who owes tap and impact fees in the first place, see who pays tap fees. This article picks up at the purchase.

Fees the builder paid before closing

Utilities bill whoever applies for the permit or meter, and on a production home that is the builder. Charlotte Water, for example, collects its system development fees with the service application, so a finished Charlotte house has already absorbed about $6,727 in FY27 water, sewer and meter charges on a subdivision lot. It is recovered through the price, not itemized; see new construction utility costs for other cities.

Two situations change that. First, the purchase contract can shift a charge to you, for example a fee increase that takes effect before the builder pulls the permit, or a meter or connection charge the builder lists as a buyer cost. Second, financed charges and special-district debt can follow the property. Seattle Public Utilities, for instance, makes the unpaid balance of a system development charge installment contract due 24 months after signing or at sale or transfer of the property, whichever comes first, which means it has to be settled at closing if the builder used the plan.

Where utility charges appear on the Closing Disclosure

The Closing Disclosure is the form your lender must get to you at least three business days before you sign the loan, under 12 CFR 1026.19(f). Its contents are set by 12 CFR 1026.38. Utility-related money can land in five places:

Closing Disclosure sections under 12 CFR 1026.38 and the CFPB’s official commentary, read 2026-09-24.

Page 2 has three payment columns: borrower-paid, seller-paid, and paid by others. If the builder is covering a fee at closing, it should sit in the seller-paid column, not yours. Compare the form with the purchase contract and raise any pass-through fee that is missing or in the wrong column before you sign.

Texas: MUD and PID notices

Many new subdivisions in Texas, particularly outside city limits, get water and sewer from a municipal utility district that borrowed to build the pipes and repays the bonds through a property tax on the homes it serves. Texas Water Code §49.452 requires a seller of property in such a district to give the buyer a written notice before a binding contract is signed. If the seller skips it, the buyer can terminate the contract. If the notice arrives only at closing and the buyer closes anyway, the law treats the right to terminate as waived. A separate, current copy is signed at closing and recorded in the county deed records.

Section 49.4521 prescribes what the notice says, under the title “Notice to Purchaser of Special Taxing or Assessment District.” It gives the tax rate per $100 of value, the bonds approved and already issued for water, sewer, drainage, roads and parks, and any standby fee. It also has to state that the cost of district facilities is not included in the purchase price. That is why a MUD home can look cheaper than a similar home in a city: part of its infrastructure is paid through the tax bill.

2025 tax rates per $100 of appraised value, from each district’s website, checked 2026-09-24. Annual amount on a $400,000 appraised value is our arithmetic.

The math: $400,000 ÷ 100 × $1.24 = $4,960, or about $413 a month. The same house in MUD 149 carries $1,260 a year, a $3,700 annual difference from district tax alone. These come on top of county, school and other taxes, and each district resets its rate yearly.

A public improvement district works differently. Instead of a tax rate, the city or county levies an assessment on each lot for the improvements. Texas Property Code §5.014 requires a seller to give a PID notice that the buyer acknowledges before the contract is binding. It states that the assessment may be paid in full at any time and otherwise comes due in annual installments that vary with interest and costs, and that unpaid assessments can lead to a lien and foreclosure. Ask the city or county for your lot’s payoff amount and current installment.

Florida: community development districts

Florida’s version is the community development district, which can levy taxes and assessments to pay for building, operating and maintaining its public facilities and services. Florida Statutes §190.048 requires each contract for the initial sale of a parcel or home in a district to carry a disclosure just above the buyer’s signature, in bold type larger than the rest of the contract. It says the district may impose taxes and assessments for construction, operation and maintenance, set annually by its board, in addition to county and other local taxes.

That statement tells you a district exists, not what it costs. The numbers are in a second document. Under §190.009, each district must disclose how its improvements are financed and maintained, give developers copies for every prospective initial buyer, and record the disclosure in the county property records. Ask the builder for that document and the district’s current budget.

Then check how the district bills. Ask whether the assessment is collected on the county property tax bill or billed directly, because that decides whether your lender counts it in the “Taxes, Insurance & Assessments” estimate on page 1 and whether a proration shows up on page 3.

After closing: deposits and account setup

Once you own the house you open the water, sewer and power accounts in your name, and the utility may ask for a deposit and a start fee. Published amounts for a single-family account:

Residential account charges from each utility’s current rate page or code, checked 2026-09-24.

A Hillsborough County buyer with no credit waiver would pay $185 + $25 = $210 to start water and wastewater. In a Texas MUD, water and sewer usually come from the district, which sets its own charges, not the nearby city; see Houston tap fees.

Questions to ask the builder before you sign

1. Are all water, sewer, meter and electric connection fees paid, and are any listed as a buyer cost in the contract? Get the answer in writing.
2. Does the contract pass through fee increases? If a utility raises its fees before your permit is pulled, find out who pays the difference.
3. Was any fee financed through a utility installment or deferral plan? If so, it may be due at closing or follow the property.
4. Is the lot in a MUD, PID, CDD or other special district? Ask for the Texas §49.452 or §5.014 notice, or the Florida §190.009 disclosure, before the contract is binding.
5. What is the current district tax rate or assessment, and can the debt portion be prepaid? Ask for the payoff figure for your lot.
6. How are district charges handled at closing? Ask whether they are included in the lender’s escrow and how the year’s proration will be split.
7. Who provides each utility? Get the name of the water, sewer and power provider so you can set up accounts and budget deposits. If the builder is unsure, here is how to find the water and sewer provider, and our guide to utility deposits on a new home covers typical amounts.

Related: who pays tap fees · new construction utility costs · Texas utility connection costs · Florida utility connection costs · Hillsborough County tap fees · San Antonio tap fees

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