Res 2014-119/Adopting an Annexation and Extraterritorial Jurisdiction (“ETJ”) Management Strategy

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for annexation in that calendar year. Selection of areas for annexation follows an in -depth staff analysis based on the annexation considerations described above and the fiscal impacts associated with the annexations. Because of the time required for the analysis and the additional time required for hearings, selection of areas for the annual program should begin early in the year. Areas may be added to the annual program throughout the year as opportunities for voluntary annexation arise. Fiscal Impact Model Given the fiscal implications of annexation, the cost of providing municipal services needs to be estimated and weighed against the anticipated revenues of each annexation program. Areas proposed for inclusion into the annual annexation program should undergo financial analysis prior to adoption of the plan scheduling annexation hearings. First year service costs will almost always exceed revenues because of the lag time between annexation and the collection of taxes. Annexations may also require one -time only expenditures for capital facilities. To spread these costs over several years and to provide a better picture of the operating costs associated with those facilities, the fiscal impact of annexations should be estimated over a multi -year time frame. Fiscal impact analyses for annexation are typically based on the time period used by the city's finance department for budgetary planning or on the ten -year period of the annexation service plan. The City's fiscal model for annexation is based on a ten -year period. Annexation Resources Supplement In conjunction with the adoption of this Annexation /ETJ Management Strategy, the Annexation /ETJ Management Review team shall assemble such written resources and develop such internal procedures consistent with state law and this Strategy as necessary to facilitate the implementation of this Strategy. A map of San Marcos' ETJ and surrounding municipalities as well as detailed discussions of each BMP, MUDS, Water Districts and ETJ PIDs will be contained in the supplement. Initial Action Items In order to implement the strategy the following items have been identified to undertake after adoption of the report: - Establish an Annexation /ETJ Review Team. - Create the Rolling Annexation Candidate List - Develop and utilize an annexation fiscal impact model (FIM). - Monitor ETJ boundaries with adjacent cities (i.e. Kyle, Martindale, New Braunfels, and Wimberley) and identify and resolve boundary issues. - Evaluate the City's Special District Ordinance under Chapter 70 of the City Code and consider amendments pertaining to MUD's and the advantages and disadvantages of establishing a policy governing the City's consent to PID's in the ETJ. 6111age