For years, cities have undertaken land annexation as neighboring areas seek municipal services, or because the city itself desires control over the suburbs or neighboring unincorporated areas.
This is because, regardless of city size or geography, all cities experience some development outside of their boundaries.
These “fringe” areas develop due to less expensive land prices or less restrictive zoning laws.
Even if a city doesn’t want these fringe areas to pop up, they will, and they will strain the effectiveness of the local government by attempting to use the city’s resources and services without contributing their share of the cost.
The obvious answer is land annexation.
This occurs when a municipality expands its boundaries into adjacent areas not already incorporated into the municipality.
In this blog, we’ll discuss the top things you must know about land annexation.
Let’s get started.
1. What is land annexation?
Land annexation is the addition or incorporation of a territory into a city.
This is a fairly common practice, especially in states where there is consistent population growth (think Florida, California, New York, or Texas).
Often, incorporated municipalities will consider annexing private and commercial properties to maintain both the fiscal and physical growth of a city.
By expanding its territory, a city will ultimately increase its ad valorem tax base, utility taxes, and miscellaneous revenue sources (i.e. fines, fees, utility connection charges).
That said, it can also create issues for a homebuyer, real estate agent, and title agent if they are unaware that a property is annexed (see #6 for more on this!).
2. What are famous examples of land annexation?
Are you curious about some common examples of land annexation in history?
Here are some that can help you understand how land annexation works.
Port of Los Angeles
The Port of Los Angeles along with San Pedro, Wilmington, and Harbor City neighborhoods of Los Angeles are connected to the main part of the city by a Shoestring Strip.
O’Hare Airport is connected to the city of Chicago via a narrow strip of land that is only 200 feet wide.
This land was annexed by the city in the 1950s to ensure the airport was contiguous with the city and to keep it under city control.
The strip itself is bounded on the north by Rosemont and on the south by Schiller Park.
South San Diego
South San Diego (next to the Mexico-U.S. border) is physically separated from the rest of San Diego by National City and Chula Vista.
A narrow strip of land at the bottom of San Diego Bay connects these southern neighborhoods with the rest of the city.
3. What are the laws surrounding land annexation?
Annexation laws vary from state to state, so it’s best to look up the specific rules and regulations in your jurisdiction.
4. Is land annexation controversial?
Yes, land annexation is controversial.
While it often fosters growth for the city, there may be strong interest in preserving the existing tax base and sense of place.
Furthermore, the fiscal and social impact of annexation is a complex assessment.
Ultimately, the municipality must look at the type of land being annexed, its current value, the number of residents being affected, and the expense of expanding services to the residents (if necessary).
Sometimes the cost of expanding services will be greater than the additional tax revenue.
On top of this, chances are that land annexation won’t please everyone being impacted.
Especially because some homeowners will see an increase in their property taxes after annexation.
With all that said, a city’s ability to annex land from its surrounding county is a primary determinant of its fiscal health.
If your city is annexing land, then chances are that it’s doing well financially.
5. How does land annexation begin?
There are two primary methods that cities use to annex land: the election method and the petition method.
This method requires the approval of a majority of voters in the proposed annexation area.
The process can be started by either a petition (see below) or by a city council resolution.
This method requires a petition to be submitted with a threshold number of signatures.
For example, in Washington State, most cities or towns require signatures from property owners representing 10 percent of the assessed property value of a proposed annexation boundary.
In other areas, a certain percentage of property owners or voters in the area being annexed must sign the petition.
6. What do you do if you think your property may be annexed?
If you’re house hunting or looking at properties, and you think your property may have been recently annexed, what do you do?
It’s a great question!
Here’s what you should do as part of your due diligence:
Check county records
One of the easiest ways to find out if a property is an annexed property is to look online.
Many counties provide this on their county website if you simply search the address in question.
You don’t want to end up with double charges!
Request an unrecorded municipal lien search
Once you know that the property has been annexed, make sure that a municipal lien search is performed to obtain both county and city information.
You will want to do this because recently annexed properties may have liens, fees and unpaid utilities from both the county and the city.
Check for special assessments from both the city and the county
Additional services may be provided to the property via special assessments from the city to cover the cost of expanding the city’s infrastructure.
If the property was recently annexed, you will want to check for these.
7. How does property annexation impact a buyer?
Often, the goal of land annexation for homeowners is to streamline and centralize the services provided to them.
Instead, it can result in the duplication of water and wastewater services.
Because city and county lines can run alongside each other, different services can be maintained and billed by two different municipalities.
This can result in additional fees applying to the annexed property.
If you’re looking to buy a property, make sure that your title company has annexation research on their real estate due diligence checklist.
This can ensure that you won’t be getting hit with double fines and fees.
8. What restrictions are there on land annexation?
In some states, municipalities are not allowed to annex land that is not directly connected to their existing territory.
This can lead to the creation of what’s called a shoestring or flagpole annexation, which allows municipalities to acquire new territory that is contiguous with existing territory but is in fact only connected by a thin strip of land.
The name comes from the fact that the strip of land resembles a shoestring.
The name flagpole comes from the fact that the connection is the pole and the annexed territory is the flag.
9. What is land de-annexation?
In the past couple of years, cities like Memphis have made headlines for plans to “de-annex” city property.
“De-annexing” means deliberately shrinking down the city’s footprint.
After decades of sprawl, Memphis, in particular, wants to reconsider its growth pattern so that it can reevaluate its course toward fiscal sustainability.
By reducing the area of the city, it can re-prioritize the municipal budgets and enhance the services for existing neighborhoods instead of spreading itself so thin.
That said, de-annexation is rare, and in order to do this, the City Council must usually either pass a resolution to call for an election on the proposition or the property owner(s) wanting to de-annex must submit a petition calling for an election signed by a threshold number of voters.
There’s another scenario in which a property is de-annexed from one city and annexed into an adjacent and continuous city.
While this is also rare, it is possible if both city councils approve.
Once again, the process must be initiated by a voter petition or property owner petition.
10. What will I gain due to annexation into a new municipality?
If you’re being annexed into a new city or county, here are the services that you may gain:
Fire protection & prevention
Emergency medical services (ambulance)
Parks and recreation facilities accessibility
Voting rights and representation of the city’s governing body and various boards and commissions
Maintenance of public infrastructure
Enforcement of Code and Ordinances to make the community safer and more comfortable for all residences
Protection of natural resources from uncontrolled growth and development
Extension of city water and sewer infrastructure as development occurs
Upon annexation, the city is required to provide most city services immediately.
11. Will my property taxes or value change upon annexation?
Yes, annexation can impact both.
Annexation can affect your property values, and any specific questions regarding the appraised value of your property should be addressed to your district appraiser.
Land annexation can also impact your taxes.
In some cases, a resident living outside the city limits may pay only county, school district, and emergency services district tax.
However, upon annexation, a new city tax, as well as utility and water/sewer taxes, could apply as well.
12. Will the city require me to hook up to the water or sewer system?
If you were just annexed by a city, and they’re now offering you the ability to hook up to their water or sewer system, then you should know isn’t a mandate (just an offer!).
You’re generally under no obligation to hook up to the municipal water system or sanitary sewer system if you’ve been using a properly functioning septic tank.
That said, if your septic system happens to fall within 300 feet of the sewer main, then your new County Health Department may require that you connect to the sewer system.
The same goes for a well if it no longer provides potable water.
13. Is my property still “mine” after annexation?
Yes, as long as you are lawfully using your property, then you can continue to use your property following annexation.
Your property will still be yours; it will just reside within the city’s bounds.
14. Does the zoning on my property change upon land annexation?
Your city may have a “default” zone that all annexed property is placed into after annexation.
However, once the process is complete, the property owner may request a rezoning of their property.
For more information about rezoning, contact your local Planning Department.
15. Does annexation impact deed restrictions or easements along public roads?
No, annexations don’t affect either.
Easements acquired by another individual, county and/or state will both remain in effect.
Deed restrictions are also not impacted by annexations.
These will continue to apply in the same manner that they currently apply to the property.
Overall, land annexation helps to keep boundaries stable in cities and provide services where they are needed.
However, in some cases, land annexation can complicate properties that you’re hoping to purchase or land that you’ve long lived on.
These tips can help you as you navigate this process.
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Disclaimer: we are not lawyers, accountants or financial advisors and the information in this article is for informational purposes only. This article is based on our own research and experience and we do our best to keep it accurate and up-to-date, but it may contain errors. Please be sure to consult a legal or financial professional before making any investment decisions.