What Is A Municipal Setting Designation?

July 13, 2016 by Duable

A municipal Setting Designation essentially addresses shallow groundwater contamination under redeveloping properties, while protecting human health, the environment and the city’s drinking water supply.


Several Texas cities have adopted a Municipal Setting Designation (MSD) policy and guidelines to provide for the consideration of applications from property owners for requests for an MSD, as authorized by Chapter 361 of the Texas Health and Safety Code.

An MSD is an official state designation given to property within a municipality or its extraterritorial jurisdiction that certifies that designated groundwater at the property is not used as potable water, and is prohibited from future use as potable water because that groundwater is contaminated in excess of the applicable potable water protective concentration level. The prohibition must be in the form of a city ordinance, or a restrictive covenant that is enforceable by the city and filed in the property records.


In this figure, only Groundwater Zone 1 is contaminated. An MSD can only be applied to existing contaminated groundwater zones, not to clean or uncontaminated groundwater zones. Therefore, as indicated by the vertical boundary of the box, only Groundwater Zone 1 is included in the MSD.

There are a multitude of benefits for a municipal setting designation: These programs may significantly reduce the costs and time associated with satisfying regulatory requirements enticing cities and local governments to use these programs as tools to promote growth and economic development. These tools can be especially useful in encouraging the redevelopment of brownfields, which when transformed improve property values, enhance city aesthetics, and promote public health and safety for the community.

This BIG RED Blog post is a guest post from the fine folks at ESE Partners. ESE Partners has completed numerous MSDs over the years, which has enabled their clients to realize unconsidered financial opportunity in real estate and deliver investments associated with environmentally impaired properties.

Written by Duable