Katy, Texas
Planning for Katy, where the city and the area are two different things.
The City of Katy has about 25,000 residents on 15 square miles at the point where Harris, Fort Bend and Waller counties meet. The Katy most people mean is far larger: the Katy ISD area, more than 97,000 students across parts of three counties, where most homes sit outside any city limit. Which Katy you live in decides who taxes you, how much, and what the plan needs to account for.
The situation
A small city, a very large school district, and a commute east
Katy was founded on rice farming and incorporated in 1945. Inside the city limits, a homeowner pays the City of Katy ($0.425 per $100 in 2025, with a 20% homestead exemption), the county, and Katy ISD at $1.1171. Outside them, in Cinco Ranch and the newer subdivisions west along Interstate 10, there is no city line at all: a municipal utility district financed the streets and water, and its rate, plus in places a drainage district, takes the city’s place on the bill.
Households here are younger than in The Woodlands or Sugar Land, with a median age under 38, and about a fifth of them earn over $200,000. Many drive the Katy Freeway to the Energy Corridor, where ConocoPhillips is headquartered and bp, Shell, Citgo and Fluor keep major offices. The balance sheet that results carries company stock, a pension or 401(k) tied to a cyclical industry, a home that may sit near two federal flood-control reservoirs, and a school levy higher than Fort Bend ISD’s or Conroe ISD’s.
Why it’s complex
Five things that are specific to Katy
The city, or the Katy ISD area
The City of Katy is 25,184 people and 15.3 square miles. Katy ISD serves more than 97,000 students at over 100 campuses across parts of Harris, Fort Bend and Waller counties, and most “Katy” addresses are unincorporated. City taxes, and the city’s exemptions, apply only inside the limits.
The MUD line is the swing factor
Outside the city, a municipal utility district repays the bonds that built the subdivision. In Fort Bend County’s 2025 rates, the mature Cinco Ranch districts levy $0.22 (Cinco MUD 2) to $0.30 (Cinco MUD 5) per $100, while newer districts elsewhere in the county run as high as $1.10 (Fort Bend MUD 162). A drainage district such as Willow Fork ($0.145) can add a line of its own.
Katy ISD at $1.1171, and the exemptions against it
Katy ISD’s 2025 rate is higher than Fort Bend ISD’s ($1.0569) or Conroe ISD’s ($0.9496), so the $140,000 homestead exemption matters more here. At 65 or if disabled, the district adds the statutory $60,000 plus a $10,000 local option, and inside the city limits the City of Katy adds a $100,000 senior exemption to its 20%.
The Energy Corridor is the commute
ConocoPhillips’ headquarters is on North Eldridge Parkway, and bp, Shell, Citgo and, since 2024, Fluor keep major offices along the same stretch of Interstate 10, which the district credits with more than 56,000 jobs. Pay there arrives partly in stock, sometimes with a pension, and often with a layoff cycle.
Equity compensation and concentrated stockTwo reservoirs and the floodplain map
The Addicks and Barker dams, completed in 1948 and 1945, hold storm water west of Houston to protect Buffalo Bayou downstream. The government-owned land inside them ends below the maximum pool, so subdivisions sit within the reservoirs’ upper reaches. In Harvey, 154,170 Harris County homes flooded, and only 36% had flood insurance.
Sources: U.S. Census Bureau, ACS 2020–2024 5-year estimates; Katy ISD, 2025–26 enrollment; Fort Bend County 2025 tax rates and exemptions; U.S. Army Corps of Engineers, Addicks and Barker; Texas Comptroller, homestead exemptions.
Our approach
One plan for whichever Katy you live in
We model the household under the taxing units at your address, which in Katy can mean a city and a county, or a MUD, a drainage district and a county, and always Katy ISD. A worked example: on a home at the City of Katy’s median value of $401,700, the $140,000 school exemption lowers the school-taxable value to $261,700; at Katy ISD’s 2025 rate that is about $2,923 a year for the school portion ($261,700 × $1.1171 / $100). Inside the city limits, the 20% city exemption reduces the city base to $321,360, and at $0.425 per $100 the city portion is about $1,366. Outside the limits, a MUD line replaces it and can be larger.
Read the districts before the closing
Which MUD, whether a drainage district applies, the reservoir pool elevation relative to the lot, and what flood insurance costs. These are balance-sheet inputs, not just closing paperwork.
Plan around the cycle
Equity compensation sized against an energy paycheck, a cash reserve sized for a layoff, and workplace plans that are federal-only at the state level.
Use the Texas window
Pension elections, Roth conversions in the low-bracket years, Social Security timing, and the over-65 exemptions from Katy ISD and, inside the city, from the City of Katy.
The work
What you’ll work through with us
- City, county, MUD, drainage and Katy ISD lines modeled for your address
- Homestead exemption filing and the over-65 school-tax ceiling
- Flood exposure and insurance cost as inputs to the home’s place in the plan
- RSU, stock option and ESPP planning, including concentrated positions
- Cash reserve and severance planning for cyclical employers
- Pension lump-sum versus annuity analysis
- Roth conversion sizing in a no-income-tax state
- Retirement income and Social Security timing
Planning is led by Theo Halbardier, CFP®, CIMA®, CAIA®, the firm’s founder. We are fee-only: no commissions, no product sales. About Theo
Questions
Common questions from Katy households
Do you have an office in Katy?
We work with Katy-area households by video and, by arrangement, in person. We do not maintain a public office location.
Our address says Katy, but we’re not inside the city. What does that change?
You do not pay the City of Katy’s $0.425 rate or receive its 20% and $100,000 senior exemptions. Instead a municipal utility district bills you for the bonds that built your subdivision, sometimes with a drainage district as well, and your county is Harris, Fort Bend or Waller depending on the lot. Katy ISD applies either way. The MUD rate, not the school rate, is usually what separates two similar homes.
How much does the homestead exemption save in Katy ISD?
The $140,000 school exemption is worth about $1,564 a year at Katy ISD’s 2025 rate of $1.1171 per $100. At 65 or older, or if disabled, Katy ISD adds $60,000 plus a $10,000 local-option exemption, and the district’s tax on your homestead is capped from that year forward.
Why is our MUD tax higher than a neighbor’s a mile away?
Age of the district, usually. A MUD levies enough to repay the bonds that built its water, sewer and streets, so a district still paying down construction debt charges more than one that has largely retired it. Fort Bend County’s 2025 sheet shows Cinco MUD 2 at $0.22 per $100 and newer districts above $1.00. The rate is public on the county’s worksheet and on your appraisal notice.
We’re near the Barker Reservoir. Should that change our plan?
It changes the inputs. The government-owned land in the reservoirs ends below the maximum pool elevation, and after Harvey a federal claims court held that the Corps of Engineers had taken a flowage easement over upstream properties that flooded. For a household, the practical questions are the lot’s elevation relative to the pool, the cost of a flood policy, and how much of the net worth sits in the house. We treat the home as an asset with a known exposure, not as a given.
One of us works in the Energy Corridor. What is different about that plan?
Concentration, mostly. Salary, bonus, restricted stock and sometimes a pension all depend on one company in a cyclical industry. We size the company stock against everything else you own, hold a larger cash reserve than a two-income household in unrelated fields would need, and model the pension election and severance terms before either is on the table.
Reviewed by Theo Halbardier, CFP® · Updated September 2026 · Figures current for 2026
Tell us which side of the city line you’re on.
The first conversation is 30 minutes. No preparation needed.
We work with individuals and families across Katy and throughout Texas, meeting by video or in person by arrangement.
Meet with usWe do not maintain a public office at this location; Katy is part of the area we serve. Figures reflect law and published rates as of September 2026 and may change.