By Charlie Tyer

In December 1989, the City of Columbia initiated without much notice and fanfare annexation proceedings designed to bring into its borders the Columbiana Centre shopping mall. The mall was some 10 or 12 miles from Columbia's city limits, but less than one mile from the city limits of the Town of Irmo. In order to reach the desired area, Columbia had to use a technique called "strip annexation" in which it annexed a long narrow strip of land (five miles in this case) to satisfy the legal requirement of contiguity.

A battle quickly erupted between the two cities over this rapidly developing commercial area which lasted for months, and in some cases years, before all related court cases were finally disposed of. In the end Columbia won. But in winning a battle, perhaps a war was lost. The war in question is the ongoing quest for liberalized annexation procedures in South Carolina.

At the time there were only three major annexation options available to cities in South Carolina. Each of them, however, required petitions by property owners in an area prior to annexation, and in two of the three cases an election in the proposed area as well. Most observers agree that the procedures were quite restrictive and made annexation difficult, but not impossible. Legal actions by Columbia in its battle with Irmo resulted in a federal district court applying a fourth circuit federal appeals court ruling to South Carolina which struck down two of the three annexation options. [The federal case referred to is the Muller v. Curran (1989) case which was applied in the case of The Harbison Group v. The Town of Irmo (1990)]. Thus, one primary method of annexation exists today, the 75 percent petition-ordinance method. This method requires that a petition for annexation be signed by 75 percent of the freeholders (property owners) who own 75 percent of the assessed valuation of real property in the area seeking annexation. Because of the extraordinary majority required in this case, no election is required and the city council can annex the area by city ordinance.

Municipal officials, the South Carolina Advisory Commission on Intergovernmental Relations (ACIR), and many students of local government continue to call for change in the state's restrictive annexation laws to allow cities to grow. The purpose of this article is to join that call, but with a different suggestion than has typically been made in the past. This article will argue that the situation in South Carolina is so serious that more drastic action is needed than may be considered. Specifically, we will argue here that cities should be granted the power of involuntary annexation, i.e., the ability to annex territory without a vote of those in the proposed area of annexation. Currently such authority in South Carolina does not exist.

But, there are caveats. Restrictions on abusive municipal annexation powers would be needed, and some protections built in for property owners and residents in areas adjacent to cities. These will be described in more detail below. First, however, the case must be made for this proposal.

Surveying the statutes of the American states, one finds that there are five basic types of annexation procedures in use. These are: (1) a petition of affected property owners, (2) by city ordinance, (3) through some type of judicial determination, (4) by some kind of independent boundary review board or commission, or (5) by state legislative action. Typically, the states often combine several methods, as did South Carolina, thereby giving cities alternatives to choose from. The result is a great deal of variation across the American states regarding municipal annexation. One thing that most states do have in common, however, is that usually some type of self-determination requirement is attached to annexation options thereby requiring the consent of those proposed to be annexed, or at least a majority of them.

This was certainly the rule in South Carolina with the two methods of annexation which were struck down. And, it remains the case with the 75 percent method. But, a case is made for an alternative. Laurie Reynolds, writing in the Spring 1992 issue of The Urban Lawyer, makes just such a case. Building upon her arguments, we will state the case for involuntary annexation in South Carolina. To begin to see why this may be necessary, however, we need to review some facts about South Carolina.

In 1992 the S. C. ACIR published a report entitled South Carolina's Communities: A Profile in Change. In it, the ACIR reported that S. C. in 1990 had 22 urban counties which contained 82 percent of the state's population, 87 percent of the state's jobs and income taxes paid, accounted for 91 percent of both the value of construction in the state and sales in the state subject to the sales tax. The state's larger cities and towns are in these 22 counties. All the metropolitan areas are obviously in them.

In fact, 61 percent of the state's population in 1990 lived in a metropolitan area county, but only 37 percent of the population lived in a city or town. This was a decline from 1970 and 1980 when respectively 45 and 38 percent lived in a city or town. Thus, as people moved into the urban counties, they did not move into city boundaries, but rather chose to live in suburban communities. The result is that South Carolina has the lowest percentage of residents living in cities of any state in the southeast! Moreover, when one compares the growth of South Carolina's largest cities with North Carolina, our neighbor to the north, one quickly sees that our restrictive annexation policy has restricted our cities growth.

(Click Here For Tables 1 - 4, from the South Carolina Advisory Commission's May 1991 annexation report. Reprint. Source: S. C. Advisory Commission on Intergovernmental Relations)

Why have cities in South Carolina failed to grow? The reasons are similar to what we find in many other states, with one or two unique features to South Carolina. These involve the conflicting interests of the various parties who have an interest in municipal annexation: neighboring cities, adjacent special purpose governments, the unincorporated fringe, electric cooperatives and investor owned utility companies, and the American tradition of self-determination. We will examine each of these briefly.

Neighboring cities. An obvious conflict often arises when two cities are in close proximity to one another. Expansion by one raises the possibility that the other city will be unable to grow, and will lose valuable taxable property, as well as other revenue sources. The competing cities may also have different ideas about land-use in the contested area. Moreover, they may both see the desired land as being in their respective natural path of development.

Adjacent special purpose governments. Besides other cities, special purpose governments also exist in South Carolina. These include such entities as fire districts, water and sewer districts, recreation commissions and so forth. Established most often prior to home rule when counties could not provide such services, and few other alternatives existed to meet a need for these services, these special purpose governments were created by special act of the state legislature or in some cases under general law. (Indeed, argue some observers, poor annexation laws encouraged the creation of districts.) As cities grow and attempt to annex territory within a special district, conflicts often arise between the competing governments since the loss of territory by the special district may affect its service delivery and fiscal condition in the remaining territory it services. And turf is an issue. Like it or not, few organizations willingly diminish themselves.

The unincorporated fringe. The third conflicting interest in annexation controversies often comes from the landowners, businesses and residents of the unincorporated area proposed for annexation, and sometimes from the county in whose borders the area falls. Landowners, businesses and residents are usually the most directly affected by proposed annexations. They often will see their taxes or other fees increase by inclusion in the adjacent city. In addition, the regulatory controls of the city may be more stringent than what exists outside the city.

And, other factors may exacerbate conflict. The demographics of the city may be markedly different from the area proposed for annexation in terms of race, education, socio-economic level, and so forth. This may stimulate opposition from the "would-be" city citizens. Finally, residents who live on the fringes of cities often move there deliberately. They may want to escape "urban life" as they understand it, but at the same time have access to the amenities of it. As writers like William Schneider, writing in the Atlantic magazine (July, 1992) have noted, suburbanites often move to the suburbs in order to "buy their own governments" that will provide only what they desire, while filling their other needs through private consumption and purchasing arrangements which they can afford. Thus, they resist being incorporated into what they attempted deliberately to avoid.

Electric cooperatives and investor owned utilities. In South Carolina utility services can also be a source of conflict in annexations particularly if the city desiring annexation operates a municipal electric utility. The State Constitution gives a city the right to control utility franchises in the rights-of-way within its borders. Thus, annexing into another providers service area raises questions about who will service the contested area in the future. (Present law allows a provider to stay in an area but not serve new customers.) Such service can be lucrative to whoever gains the service area, thereby raising the stakes in the outcome of the annexation.

Self-determination. Finally, an important principle that stimulates conflict in annexation is the belief that people should have the right to choose the government that will govern them. This principle has shaped many state annexation laws and appears to be merely an extension of the democratic principle.

Thus, there are a variety of interests and sources of conflict which impede annexation in South Carolina, and many other states as well. But, there are also interests on the part of a city desiring to annex territory that need to be taken into consideration. These need to be identified also.

Cities officials argue they have some vital interests in being able to annex their fringe areas, and at times even noncontiguous areas within a reasonable distance from their boundary. First among these is that annexation allows a city to provide uniform services, which may indeed be superior to some services noncity residents and businesses receive, as well as services unavailable to noncity residents and businesses. Thus, extending a city's jurisdiction may allow the avoidance of a patchwork quilt pattern of urban services, and avoid confusion concerning who provides what in an area.

Second, city officials say that they need the ability to grow as the population of their area grows and development intensifies. Indeed, development outside of cities is often due to the unavailability of land within cities. If unable to grow, cities may confront stagnation and decline in the quality of life their citizens enjoy. And, they confront the distinct possibility of becoming landlocked by surrounding development, which owes its existence to the presence of the city in the first place--the supreme irony. Indeed, such surrounding development, if development standards are too low out of the city, may even run the risk of becoming a "ring of fringe slums" around the city. A North Carolina study group found that condition had occurred in that state before involuntary annexation power was given to cities there.

Third, a good case can be made that cities should be able to influence development on their fringe and assure that it meets sound principles of land-use and planning to assure the protection of the public's health, safety and welfare. True, some progressive counties may be able to do this, but they are probably more the exception than the rule. This is not because counties are poor governments, but because they were not created to be urban service delivery mechanisms like cities were. They confront a much more diverse citizenry in terms of service demands, some of whom are rural while others are varying degrees of urban in character. As a result, too often, counties have less restrictive planning and development controls. Then, when fringe areas do confront annexation, they have substandard conditions which may be extremely costly to upgrade or repair, not to mention the situations which cannot be changed.

Reynolds makes a good point when she writes: "Urban development...is no less urban merely because it sits on the other side of the city's border." This leads to the fourth argument for easier annexation--the area surrounding a city is in many, if not most cases, already a part of the "functional city." Residents and businesses outside of the city interact with the city. People work there during the day, but leave at night. Businesses sell their products and services there. Entertainment is provided there. Cultural amenitities are there. Medical, professional services and educational institutions are there. And, to add insult to injury, areas outside the city share the city's name for postal delivery purposes, and may already use services available to out-of-city residents and businesses such as city water, sewer, electric or gas service, and so forth. These types of services were usually funded by city residents to provide the capital to initiate the service.

Nonresidents will, of course, usually try to avoid paying for city services they use. City officials, naturally, try to compensate. But, that is difficult. The result is a shifting of costs to city residents in a way that is less than obvious to maintain city services and infrastructure used by many who pay nothing for them.

Finally, city advocates argue that self-determination taken to the extreme simply results in giving veto power to minority interests who live on the fringe of the city thereby allowing them to block the wishes of the majority who live in the city. Have we, they ask, merely "elevated and declared inviolable the wishes of a few residents to the possible detriment of the interests of the broader municipality." Thus is raised a classic question in a democracy--majority versus minority rights.

The North Carolina Municipal Government Study Commission confronted this question and answered as follows: "We do not believe that an individual who chooses to buy a lot and build a home in the vicinity of a city thereby acquires the right to stand in the way of action which is deemed necessary for the good of the entire area."

Of all the states, North Carolina is probably the leading example of a state that has accepted the principle of involuntary annexation. In so doing they recognized the need for a state policy on urban areas and annexation. Why would a state do such a thing? There are a number of state interests involved that lead the states to take this action. The primary ones are: (1) sound urban development is essential to economic development--witness the success North Carolina has had in this regard; (2) that cities are normally better prepared to provide essential urban services than are counties or special purpose governments since that is the reason for their establishment; and, (3) that areas that are incorporated into cities should be guaranteed the right to receive equal essential city services

If there is a state interest in less restrictive annexation, and assuming that a state policy is needed, what should it look like? Reynolds provides an illustration for purposes of discussion which we will repeat here. It reads:

Obviously this policy needs to be fleshed out. We will do this below. But, it provides a starting point for our discussion to follow.

First, however, it is important to point out that North Carolina is not the only state to allow involuntary annexation irrespective of the wishes of those annexed. Others that do so include Idaho, Kansas and Tennessee. Still others do so within limited circumstances, such as: Louisiana which allows forced annexation of territory which is 90 percent contiguous to the borders of a city, with an election required if the area is inhabited; in Illinois a city can annex any parcel of land under 60 acres totally surrounded by the city; and, in Oregon a city may annex land that is totally surrounded of any size.

Thus, there are precedents. Above we have a policy statement. The next step is to further define the elements of an improved annexation policy. To that we now turn.

We can identify at least six elements which need to be addressed in a good annexation policy. These include adequate definitions of an urban area and associated concerns about contiguity, the methods of annexation available and when they can be used, procedural issues involving notice and public hearings, the applicability of the prior jurisdiction rule and extraterritorial powers of cities, how challenges to annexation will be handled, and miscellaneous concerns. These will be discussed briefly in the order listed above.

The policy stated earlier says that land that is used for urban purposes should normally be municipal. Thus, the level of urbanization needs to be clearly defined to guide municipal actions. This can be done by first requiring contiguity for annexation to occur and prohibiting strip annexation. Some may express concern over limiting annexation to contiguous land and the possibility that undeveloped land on the fringe of a city could block annexation of more developed land close by. North Carolina provides a good model here. It allows voluntary annexation of nearby noncontiguous land that is urbanized so long as it is not more than three miles from the municipality's border.

The result of this policy is avoidance of the patchwork quilt pattern city boundary now possible in South Carolina, and evidenced by the City of Columbia and others. This pattern decreases the efficiency of city services, is confusing to citizens and makes planning and coordination difficult among the area governments.

Second, to forestall selective annexation of parcels of land, cities should be allowed to use involuntary annexation either for parcels of land held in single ownership, or tracts of land either developed already or platted as a subdivision. Thus, subdivisions would not be split with portions in and out of a city.

Third, urbanization requirements should be established as a prerequisite for annexation. A simple standard could be used saying that if land is currently devoted to, or platted to be developed for urban purposes, it can be annexed. Or, as other states have done, such as North Carolina, Florida, Nevada, North Dakota and Indiana, quantifiable criteria could be attempted using the number of people per acre, percent of the land subdivided, and amount of land zoned for commercial, business or industrial use.

For purposes of clarity, the methods available for cities to annex land should be listed and clarification provided as to which sections of the law apply to which annexation methods. We are suggesting here two primary methods: unilateral or involuntary annexation by municipal ordinance, and petition based annexation requiring landowner petition before an ordinance can be enacted.

Involuntary annexation. Involuntary annexation could be allowed in three instances: when land is surrounded by the annexing city; when the land is urbanized and contiguous to the annexing city; when the city's border is separated by a small tract of undeveloped land from land that is urban in character.

Of these the more drastic is of course the unilateral annexation of contiguous land. Concerns no doubt can be raised about abuses of annexation by cities, but if adequate attention is given to definitions and conditions, protections can be built into state law. For example, the law could require that in cases of involuntary annexation, the annexing city must prepare a written plan showing its ability to deliver services to the area it wants to annex. This seems to be increasingly required by states, such as California, Colorado, Indiana, Kansas, Missouri, Nevada, North Carolina, Oklahoma, Tennessee, Texas, and Wyoming.

Reynolds suggests that state law require that the plan specify what services will be extended, the estimated costs of extension and how they will be financed, assurances that the area will receive equivalent services in quality and quantity to the rest of the city, and a time frame in which the services will be provided. Failure to meet the plan could result in annexed citizens asking for a court order to force compliance.

The idea of annexing undeveloped land on the fringe of a city is simply to prevent circumvention of annexation by leaving strips of land undeveloped adjacent to a city. By stating in law restrictions on the size of land tracts subject to such annextion (large enough to discourage owners from leaving it undeveloped, but small enough to keep the commitment to contiguity), the law could help discourage patchwork urban development patterns and inefficient city boundaries.

Petition-ordinance annexation. Annexation by petition and municipal ordinance is, of course, a voluntary method of annexation. Retaining it is desirable for several reasons. First, it is what South Carolina has used in the past for most major annexations. Second, it offers a less cumbersome way to annex when landowners/residents are willing to be annexed. This is so because the required plan for annexation outlined in the unilateral annexation method above could be waived in this method.

However, land should still meet the criteria outlined above for being urban and contiguous to a city. Thus, petitions would not be allowed to be used to circumvent a logical urban development plan and service area. Reynolds goes further, however, in her proposal and suggests that landowners in contiguous areas be allowed to force annexation on an unwilling city. Thus, the broad powers of annexation granted above are counterbalanced somewhat by giving landowners rights when a city drags its feet about taking in new citizens.

A variant in the petition-ordinance method of annexation would involve annexation of noncontiguous land. North Carolina is currently the only state that allows this now, but then only within three miles of the city limits. (Some states do, however, let cities annex such land if it is owned by the city or contains a city operated facility. Illinois has an interesting and unique provision allowing "annexation agreements" between property owners of noncontiguous land and a city. These agreements seem to give the affected area de facto annexation status.) Reynolds suggests that annexation of noncontiguous land only be allowed if all land owners agree, and that state law should establish limits, such as North Carolina does. In addition, the law should also say that noncontiguous land cannot be used to create a new city border for purposes of future involuntary annexations.

The law should in all cases require notice and hearing when a city desires to annex land, or when a petition is presented for annexation. Currently requirements vary among the states. Going further, the proposal advanced here is that municipal planning commissions be required to hold a hearing on proposed annexations, and that this hearing occur prior to final legislative action by the city. Moreover, owners of property subject to annexation, as well as surrounding owners or residents should receive notice of annexation proceedings.

Today in urbanized areas annexation disputes frequently involve competing jurisdictions, as in the case of Columbia and Irmo. In South Carolina, as in most states, the prior jurisdiction rule applies, that is whoever gets there first is presumed to have first claim on an area targeted for annexation. Reynolds suggests that in such urban settings--and perhaps in others as well--extraterritorial jurisdiction be given to cities over such subjects as subdivision regulations and zoning. The sphere of power could even be the limit of noncontiguous annexation authority. Moreover, it could be limited to cities of a certain size. (The only way cities can now get extraterritorial jurisdiction in South Carolina is with the consent of the county.)

In an urban setting, the law could stipulate that adjacent cities reach a boundary agreement that delimits each others sphere of authority and presumed development path. If they are unable to agree, a mechanism for arbitration could be forced upon them by law using a specially appointed commission, a court, or a county entity of some sort. The law could also specify the factors to be considered in the review process, such as service needs and capacities, geography, land use patterns and so forth.

Had such a requirement been in place in the Columbia-Irmo dispute, perhaps the battle would never have resulted.

The law should state clearly the bases for challenge to annexation and the time period within which a challenge should be filed. Complaintants should be required to allege facts which if true would show noncompliance with the law, and they should be required to have the burden of proof rather than the city. In addition, remedies should be provided for property owners who show a city has violated the law. An example might be giving the courts the power to enforce a municipal duty to an annexed area. Another option, though, is giving disgruntled residents/property owners the right to de-annex if a city fails to live up to its duty within a certain time period. Cities should also be protected from groundless suits, however. Disincentives can be legislated, such as sanctions for frivolous challenges, attorney fees going to the prevailing party and so forth.

A couple of other items need mention. One is defensive incorporation by resident/property owners to avoid inclusion in a neighboring city. (An contemporary example of such is in Sumter County.) State law could be written to prohibit such within the sphere of extraterritorial power of a city. However, refusal by a city to annex land could also be taken as grounds for incorporation.

Another concern is how to deal with the financial impacts of annexation on existing units of government to soften the impact of annexation. One possible solution would be to allow or require financial transfers from the annexing city for a limited period of time. This could even be a decreasing share over a specified period of time. Whatever course is chosen, state law should provide some guidance on this.

Thus, the outline has been provided for a new approach to annexation in South Carolina. It differs significantly from existing law and practice in important respects--most specifically in authorizing involuntary annexation subject to conditions and planning requirements, and in allowing more widespread use of extraterritorial power by cities. The increase in municipal power is counterbalanced with more responsibility for actually serving an urban area it takes in within a specified period of time or face consequences. And, noncity property owners and residents are even given some power to compel annexation.

Some will no doubt argue that this proposed policy change tramples the rights of the property owners and/or residents in areas adjacent to cities. To that one must respond what rights do those in the city have? Moreover, let us take an honest and hard look at how the annexation process works now. One does not have to look far to find charges of cities engaging in land graps, circumvention of legislative intent through the use of strategies such as strip annexation, and selective annexation in order to avoid certain areas while garnering an acceptable number of names on a petition to trigger an annexation.

These strategies serve no one's best interests in the long run. These illustrate, however, how broken the South Carolina system of annexation is. The time for band-aide responses is past. Our cities are part of the driving force in our state's economic well being. Growth is concentrated in the urban counties. It is in everyone's best interests to have vibrant and healthy cities, planned development and economical services in areas that are by any standard urban. The Columbia-Irmo conflict forebodes our future if we do not act responsibly. The proposal put forth here provides a starting point for responsible action. Let us use it as such and begin the dialogue needed to reform our state's archaic annexation laws.

Tables 1-4

 Table 1

Table 2

 Table 3

 Table 4

 Tyer, Charlie B. "A New Approach to Annexation: Why South Carolina’s Cities Are Not Growing," The South Carolina Policy Forum Magazine, Vol. 6, no. 1 (Winter 1995): 35-44.

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