Annexation Performance

Financial Impact of Annexation

Have you ever wondered if the recent annexation of Greatwood and New Territory impacted the City’s budget?  The answer is it makes it stronger!  The annexation, which added approximately 30,000 new residents to the City along, is among the largest and most successful in state history. The City built its annexation planning around three guiding principles:

  1. providing the same level of service to the newly annexed areas,
  2. ensuring there was no decrease in existing services as a result of annexation, and
  3. a commitment that the annexed areas would generate sufficient revenues to pay for their services so that existing taxpayers do not experience any increased costs because of the annexation.

Primarily the result of nearly ten years’ worth of collecting various out-of-city surcharges for services from the annexed residents – which provided over $10M in funding for preparations, the annexation has been a tremendous success.  The City has met all of its commitments to both the annexed areas and existing residents – including the commitment existing resident would not experience any increased costs, and the annexed districts have now been fully integrated into the City’s budget.  Property owners in these areas will pay City taxes in FY19 to fully fund their services, and the significant positive financial benefits are providing additional capacity for capital projects.

In April 2018, the City Manager provided a performance update on the annexation to the City Council. Please see the Annexation Performance Update along with the backup documents to support the calculations.

In Fiscal Year 2019, residents in the annexed areas will pay City property taxes, supporting not only the cost of services but also payment of debt service assumed by the City upon annexation. In FY19 the City will no longer break out the cost of providing services to the annexed areas.