Presented by:Rose Scovel, AICP – LSL Planning, Inc.

Jamie Palmer, AICP – Center for Urban Policy and the Environment

Current lawO di◦ Ordinance ◦ Fiscal plans◦ Process◦ Notice and hearings◦ Remonstrance

Strategies Strategies Successes and failures Court cases and decisions Indiana General Assembly Questions

Forced? Involuntary? Municipal Determination? Voluntary? Super-Voluntary?Voluntary? Super Voluntary?

Territory contiguous to the municipality(IC 36 4 3 4)(IC 36-4-3-4)◦ At least 1/8 of the aggregate external boundary of

the territory coincides with the boundaries of the l ( )annexing municipality (IC 36-4-3-1.5)

◦ A strip of land less than 150 feet wide which connects the annexing municipality to the territory is not considered part of the boundaries of the territory or municipality

Territory that is not contiguous and is y goccupied by a municipally owned or operated airport or landing field

Can a municipality annex into adjacent townships?◦ YES

Can a municipality annex across county lines? Can a municipality annex across county lines?◦ IT DEPENDS…◦ Was part of the municipality in the other county on p p y y

January 1, 1982? – then yes◦ Does the executive of the other county approve? –

then yes; if not then nothen yes; if not, then no

Territory that is not contiguous and is occupied by a municipally owner or regulated sanitary landfill, golf course, or hospital

A number of special legislative provisions for A number of special legislative provisions for certain communities

A legislative body of a municipality may, by ordinance annex any of the followingordinance, annex any of the following (IC 36-4-3-4)◦ AKA – Involuntary, forced, municipal determination

If the owners of land located outside but If the owners of land located outside but contiguous to a municipality want to have territory annexed to the municipality (IC 36-4-3-5)( C 36 3 5)◦ AKA – Voluntary annexation

Annexation in which owners of land outside but contiguous to a municipality file a petition signed g p y p gby 100% of the landowners (IC 36-3-4-5.1)◦ AKA – Super-voluntary annexation

Contents (IC 36-4-3-3.5)◦ Description of the boundaries of the territory to be

annexed, including any public highways or ROW◦ Approximate number of acres to be annexedApproximate number of acres to be annexed◦ Any special terms or conditions of the annexation◦ Any property tax abatements adopted for the

tiannexation area◦ Territory must be assigned to at least one

legislative district (IC 36-4-3-4(g))

Applicability◦ Applies to ALL annexations except non-contiguous

or those covered by special legislation Requirement Requirement◦ Adopt by resolution◦ Required before notice except for super-voluntary

(5.1), before adoption of ordinance for 5.1

Contents (36-4-3-13(d))◦ Cost estimates of planned services◦ Method of financing planned services◦ Plan for organization and extension of services◦ Plan for organization and extension of services◦ Planned services of a non-capital nature will be

provided within 1 yearl d f l ll b d d◦ Planned services of a capital nature will be provided

within 3 years

Draft fiscal pland f l l b l Adopt fiscal plan by resolution

First reading of ordinance Provide notice to affected property owners Provide notice to affected property owners Hold public hearing Second reading and adoption of ordinanceg p Publication of adopted ordinance Remonstrance period

Your community may vary on readings and may require Plan Commission involvementmay require Plan Commission involvement

Public hearing not earlier than 60 days after di i t d tiordinance introduction

All interested parties must have the opportunity to testifyopportunity to testify

Notice published 60 days before hearing (shorter for super-voluntary)N i b ifi d Notice sent to property owners by certified mail 60 days before hearing (shorter for super-voluntary)super voluntary)

Ordinance may be adopted 30-60 days after hearing

Contents of noticeL l d i i◦ Legal description◦ Date, time, location, and subject of hearing◦ Map showing current and proposed municipal

boundaries◦ Current zoning classifications of the area and any

proposed zoning changes◦ Detailed summary of fiscal plan◦ Location to inspect the fiscal plan◦ Statement that copy of fiscal plan can be obtainedStatement that copy of fiscal plan can be obtained

at no charge◦ Name of representative who may be contacted

Filing◦ Must be filed within 90 days of publication of the

ordinance after adoption◦ Must be signed by at least 65% of the owners ofMust be signed by at least 65% of the owners of

land in the annexed area or the owners of 75% of the assessed valuation in the annexation areaMust state why the annexation should not take◦ Must state why the annexation should not take place◦ No remonstrance available for super-voluntary

annexation

Court orders annexation to take place IF◦ Territory sought to be annexed is contiguous AND Population density is at least three persons per acre 60% of the area is subdivided60% of the area is subdivided Zoned for commercial, industrial, or business use◦ OR Territory sought to be annexed is ¼ contiguous

( th th 1/8) AND i d d d b d b(rather than 1/8) AND is needed and can be used by the municipality for its development in the reasonably near future◦ AND the municipality adopted a fiscal plan meeting

the requirements of IC 36-4-3-13

Court must find ALL of these conditions are met to invalidate the annexation:◦ Police, fire, and road maintenance are adequately

provided by a provider other than the municipalityprovided by a provider other than the municipality◦ The annexation will have a significant fiscal impact

on the residents or owners of landTh i i i h b i f h◦ The annexation is not in the best interest of the land owners◦ At least 65% of the land owners oppose the pp

annexation (or owners of 75% of AV)

Burden of proof is on the municipality◦ Services◦ Financial burden◦ Best interest◦ Best interest

No annexation unless developer requests it Require annexation if developer wants

municipal services (especially sewer)A i i f Accept petition from property owners

Municipal determination annexation of developed areas outside corporatedeveloped areas outside corporate boundaries

Municipal determination annexation of Municipal determination annexation of undeveloped land ahead of growth

Small areas or large areas? Match sewer service area? Move in the direction of growth? Involve the property owners before process

begins?

Begin with the end in mind◦ Police and fire service quality, response time,

equipment◦ Non-municipal utility providersNon municipal utility providers◦ Financial burden on residents (will they even pay

more under property tax caps)?

Both happen

Several small areas on the NW side of town◦ Some development dating back to 1960s, 70s, and 80s◦ Some areas currently being developed◦ Residential, commercial, institutional◦ All in sewer district◦ ALL filed remonstrances, but later dropped Delaying effective date a concession made in severalDelaying effective date a concession made in several

One small area on NE side of town◦ Commercial and residential mix

d◦ In sewer district◦ Filed remonstrance, dropped in exchange for taking over

a private road and repaving it

Large area on west side of townP i il id i l◦ Primarily residential◦ More than 2,000 housing units, some multi-family◦ Primarily developed in the 1970s and 80s◦ Originally didn’t have sewers, sanitary district

extended in 1990s to fix problems; waivers useless◦ In sewer district now◦ Needed to resolve a battle with a neighboring

community over annexation areas◦ Remonstrance filed and later droppedRemonstrance filed and later dropped Decided it was cheaper to pay taxes than continue

fight

Southwest Clay TownshipC i◦ Compromise Delay effective date Tax abatement Road improvements now Plan Commission member now (actually earlier) Some property owners held out and proceeded

through court◦ Supreme Court held that fiscal plan was detailed

enough◦ Question about which group of opponents counts –

original, or after agreement and vote

Failure to act, move through the process◦ Big box area on NW side of town◦ Big box area on NW side of town◦ Small area north of town (residential and church)

Still hanging out in remonstrance process◦ Small areas on NE side of town◦ Small areas on NE side of town◦ Small areas north of town (residential)

Total failure?◦ Two adjacent small neighborhoods on north side ofTwo adjacent small neighborhoods on north side of

town, residential◦ In sewer district◦ Fire protection became driving issue in remonstrance

J d l d h i i lid l fil d◦ Judge ruled the annexation invalid; appeal filed; remonstrators currently not paying their attorney –UPDATE: Court of Appeals support city, annexation is valid

Home Place Services◦ Who provides?◦ Who else can◦ Who else can

provide?◦ Can the city

ff d id ?afford to provide?◦ Character◦ Socio-economic Soc o eco o c

factors

“Court of Appeals’ review of annexations is limited to ensuring that the municipality has not exceeded its authority and that the statutory conditions for annexation havestatutory conditions for annexation have been satisfied” – Chemical Waster Management of Indiana v. City of New Haven g y(2001)

“Annexation of territory by a municipality is f fnot a taking of property” – Chidester v. City of

Hobart (1994)

“Power of annexation is fundamentally legislative and judicial role in annexation cases is limited to that provided by statute” –Chidester v City of Hobart (1994)Chidester v. City of Hobart (1994)

“City’s failure to assign annexed territories to councilmanic districts in the annexationcouncilmanic districts in the annexation ordinances warranted granting of remonstrance petitions and denial of

fannexations” – City of Muncie v. Lowe (1999)

“A municipality’s annexation ordinance adopted in the year preceding a federal decennial census may neither take effect nor become final until January 2 of the year thebecome final until January 2 of the year the census is conducted” – Hancock County REMC v. City of Greenfield (2002)y ( )

“A trial court hearing a remonstrance is not an examiner conducting an audit of a

f fchallenged fiscal plan…” – Bradley v. City of New Castle

“City’s fiscal plan for annexed area was not frozen as of the date of its adoption and, thus, the city could amend and supplement that plan at the remonstrance hearing”that plan at the remonstrance hearing –Bradley v. City of New Castle (2002)

2007, Indiana Supreme Court◦ Appealed from Hamilton Superior Court◦ Appealed from Hamilton Superior Court◦ Issue was whether majority of landowners could agree to

a settlement◦ Superior Court held that group of landowners could not p g p

agree to settlement Carmel amended fiscal plan to reflect settlement

termsNOAX h ld f d f l d di◦ NOAX held a referendum of landowners regarding settlement and majority supported

◦ Lower court ruled ordinance and fiscal plan could not be amendedamended

◦ Carmel stated on appeal that the lower court improperly reviewed the fiscal plan

◦ Supreme Court ruled fiscal plan was sufficientAf h f d did h◦ After the referendum remonstrators did not have necessary signatures to require the annexation overturned.

2007, Indiana Court of Appeals◦ Appealed from Hamilton Superior Court decision◦ Home Place landowners prevailed in Superior Court◦ Carmel appealed based on Superior Court◦ Carmel appealed based on Superior Court

inappropriately auditing fiscal plan Reversed the Superior Court decision◦ Agreed with Carmel that Superior Court audited

fiscal plan◦ Carmel did meet its burden in showing how servicesCarmel did meet its burden in showing how services

would be financed◦ Southwest Clay case was cited

2008, Indiana Supreme Court◦ Appeal from Boone Superior Court, Transferred

from Indiana Court of Appeals◦ Court of Appeals held that the introduction of anCourt of Appeals held that the introduction of an

annexation ordinance by Whitestown precluded the RDC from creating an overlapping EDA

RDC h d j i di ti d th i ht t t RDC had jurisdiction and the right to create an EDA until Whitestown COMPLETED its annexation; trial court decision was upheldannexation; trial court decision was upheld

2008, Indiana Court of Appeals◦ Signature question – can counsel sign remonstrance

in place of land owner; signatures filed later as a court exhibit◦ Trial court dismissed because of lack of sufficient

signatures (under statute) to sustain remonstranceR t f i ll i ffi i t Remonstrance was facially insufficient◦ If the statute disagrees with normal trial

procedures, the statute takes precedencep , p

Hot topic the past few sessions

Emotional issue Perennial issue before legislature prior to

1997L i l i l d hi d f Legislative leadership request study from IACIR to put some of the issues to rest

IACIR conducts study in 1997 and 1998 IACIR conducts study in 1997 and 1998

212 citizens and municipal officials over 5 forums across the stateacross the state

Categories of comments:◦ Fairness of the process

P d l i i l l i i d i◦ Procedural issues, particularly communication and notice◦ Self-determination◦ Provision of services

Motivations to annex◦ Motivations to annex◦ Adverse impacts◦ Allocation of costs, revenues, and debt◦ Administrative issues◦ Administrative issues◦ Public health, environmental, and QOL issues

Five general methods of annexation◦ Legislative determination: annexation by state

legislation◦ Popular determination: annexation with approval◦ Popular determination: annexation with approval

of the annexed through petition or vote◦ Municipal determination: annexation by unilateral

action of municipality◦ Judicial determination: court decides◦ Quasi-judicial determination: independent board◦ Quasi judicial determination: independent board

decides

Most states use a combination Most other states allow some kind of popular

determinationI di ’ i l d b bl Indiana’s annexation laws were and probably still are some of the most advantageous toward municipalitiestoward municipalities

Direct notice to property ownersE t bli h ti i d b t bli Establish a time period between public hearing and adoption

Extend the time period for remonstrancep Strengthen definition of urban character Stronger disclosure in property transactions

of waivers of remonstranceof waivers of remonstrance Specify services that will be provided Stronger fiscal plans Clarify filing requirements

Significant changes adopted in 1999 100% voluntary option (2001) Changes to address the Indiana Supreme

Court ruling that the special provisions thatCourt ruling that the special provisions that applied to St. Joseph County were unconstitutional

Various additions to non-contiguous and limiting municipal taxation of ag landDonut hole legislation; town vs city Donut hole legislation; town vs. city permission (2005)

Increased property taxes for annexed propertiesproperties

The fallacy of increased levy Tax caps Overlapping vs mutually exclusive property Overlapping vs. mutually exclusive property

tax units Relative levy revenue distributions Relative population revenue distributions Relative population revenue distributions

(based on official census figures only) County motor vehicle excise surtax and

county wheel tax (residence of vehiclecounty wheel tax (residence of vehicle owners and relative ratio of road and street mileage)

Use the power to annex respectfully and judiciouslyV l t ( i iti t d) ti f t Voluntary (owner-initiated) annexations are safest

Open communication and honest education efforts are critical

Avoid land grabs Fiscal plans are an important municipal tool, not

just a “pain”just a pain Coordinate utility and annexation planning Important to pay special attention given changing

fiscal conditionsfiscal conditions Remember, Indiana has one of the most favorable

annexation policies for municipalities in the nation

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