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Bloomington's Annexation Proposal A Hard Sell For Some Non-City Residents

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Jimmie Johnson and Phyllis Jenshak have been neighbors in southern Monroe County Eagleview subdivision for about 17 years.  
 
“We get along great. This is a nice neighborhood.” 
 
Johnson says they have everything they need and oppose higher taxes and more government.  
 
“I just want people tell me how's this going to benefit me and my wife as homeowners here? I think it's going to favor the city more than it's gonna favor the homeowners.” 
 
He says he has no interest in helping finance city projects like Switchyard Park. 
 
Mayor John Hamilton says annexation will reduce sewer bills, provide access to policing, trash and recycling, transit services, and more. 
 
“I understand that people who are right next to a city boundary … For them, this feels like why is it good for me to be in the city? I think the question really is what's good for the whole community of Bloomington.” 
 
But is that enough to convince Monroe County residents and members of the city council? 
 
Hamilton says the average residential owner would see around a $600 annual tax increase. But that’s an average through more than 9,200 acres and 14,300 people. 
 
Indiana code stipulates municipalities can annex after a mail notice, public outreach, fiscal plans presentation, public hearings, and city council adoption. 
 
Indiana University public finance economics professor Justin Ross says that makes Indiana’s process more efficient and helps avoid urban sprawl and duplication of services. 
 
“The big trade off this style of approach done, and you can kind of see this play out, is that it's considered the least likely to have say, the most adequate planning, the least amount of communication, that it's most likely to have more hostility involved with those who you're annexing.” 
 
That’s what county commissioner Julie Thomas is worried about.  
 
“Our biggest concern is that there are residents of the county who don't know that they're being targeted for annexation. Information went out and this was a big community issue in 2017. But some new residents have moved into these properties.” 
 
The city’s 2017 annexation plan was stopped by a very late addition to that year’s state budget. Bloomington officials slammed the move as legislative overreach. They sued and won, overturning the law in December 2020. 
 
So annexation is back. Hamilton says another round of mailings will be sent to affected homeowners and a public hearing is scheduled for August 4. City council can only limit the proposed boundaries or revoke any of the eight areas during proceedings on September 15. 
 
Thomas says that’s only a few months to browse through the city’s 700-page plan. 
 
“There's a lot of questions about some of the statistical information and how the numbers were derived.” 
 
The county bases its budget on income tax based on residency. And if you’re a resident of the city, that tax gets paid to the city rather than the county.  
 
Monroe County Council member Eric Spoonmore says that, and other tax shifts, could amount to a $3.7 million cut. 
 
“There are going to be impacts on many of the county's funding sources, including, you know, local income tax, public safety, income tax, motor vehicle, highway, food and beverage tax, wheel tax and excise tax.” 
 
Spoonmore says he’s worried annexation will make it more difficult to fund county-wide services such as the Health Department and the criminal justice system. 
 
The proposed annexation is substantial so the financial ripple effect on taxing units will be too. But Hamilton says the city has no choice, annexation should have been ongoing for the last 17 years. 
 
“We need to catch up or we will always be behind and won't be able to catch up.” 
 
Hamilton points out annexation allows new residents to vote in city elections. But Jenshak says, it doesn’t make a difference. 
 
“We tend to be more on the on the conservative side. And Bloomington always goes liberal, I don't think my vote would really matter that much.” 
 
Jenshak and other annexed residents won’t get to vote in the next election anyway. The remonstrance period goes until Jan. 1, 2024, when the approved annexations take effect… right after 2023 municipal elections. 
 
For WFIU News, I’m Joe Hren. 
Jimmie Johnson and Phyllis Jenshak have been neighbors for about 17 years.

Jimmie Johnson and Phyllis Jenshak (Joe Hren, WFIU/WTIU News)

Bloomington’s mayor wants to catch up on the size of the city by annexing property in Monroe County’s jurisdiction into the city. The city’s last annexation took place in 2004. But the proposal is a hard sell for some non-city residents.

Jimmie Johnson and Phyllis Jenshak have been neighbors in southern Monroe County Eagleview subdivision for about 17 years.

“We get along great. This is a nice neighborhood,” Johnson said.

He says they have everything they need and oppose higher taxes and more government.

"I just want people to tell me how's this going to benefit me and my wife as homeowners here? I think it's going to favor the city more than it's gonna favor the homeowners,” Johnson said.

He says he has no interest in helping finance city projects like the new convention center or Switchyard Park.

Mayor John Hamilton says annexation will reduce sewer bills, provide access to policing, trash and recycling, street and sidewalk construction, transit services, trails, parks, and more.

“I understand that people who are right next to a city boundary... for them this feels like why is it good for me to be in the city? I think the question really is what's good for the whole community of Bloomington,” Hamilton said.

Bloomington Annexation Map

The city is continuing the process of annexing eight areas next to the current municipal boundaries into the city. (City of Bloomington)

But is that enough to convince Monroe County residents and members of the city council?

The city’s property and tax impact database show the Johnson’s net tax will increase about $1,100 a year.

“We're getting to the point where I'm 80 years old. And I'm thinking, once I pass on, can my wife afford to live here? That's my question,” Johnson said.

Hamilton says the average residential owner would see around a $600 annual increase. But that’s an average through more than 9,200 acres and 14,300 people.

He says low-income seniors who own their home could see a net reduction of about $70 due to deductions in protecting any rise in property taxes.

Eagleview Subdivision
Eagleview subdivision on Bloomington's southwest side is included in 1B of the proposal. (Joe Hren, WFIU/WTIU News)

Annexation In Indiana

Indiana code stipulates municipalities can annex after a mail notice, public outreach, fiscal plans presentation, public hearings, and city council adoption.

Indiana University public finance economics professor Justin Ross says that does make Indiana’s process more efficient and helps avoid urban sprawl and duplication of services.

“The big trade off from this style of approach done, and you can kind of see this play out, is that it's considered the least likely to have say, the most adequate planning, the least amount of communication, that it's most likely to have more hostility involved with those who you're annexing,” Ross said.

That’s what county commissioner Julie Thomas is worried about.

“Our biggest concern is that there are residents of the county who don't know that they're being targeted for annexation. Information went out and this was a big community issue in 2017. But some new residents have moved into these properties,” Thomas said.

READ MORE: Residents Weigh In On Proposed Bloomington Annexation In 2017

The city’s 2017 annexation plan was halted by an addition to that year’s state budget. Bloomington officials slammed the decision calling it a clear case of legislative overreach. The city won a lawsuit brought against Gov. Eric Holcomb in December of 2020.

Hamilton says another round of mailings will be sent to affected homeowners and a public hearing is scheduled for August 4. City council can only limit the proposed boundaries or revoke any of the eight areas during proceedings on September 15.

Thomas says that’s only a few months to browse through the city’s 700-page plan.

“There's a lot of questions about some of the statistical information and how the numbers were derived in the Reedy report that's on the city's website,” Thomas said.

She says the commissioners contracted Baker Tilly accounting services for $50,000 to provide an impartial review so the county can host public meetings.

County Impact

The county bases its budget on income tax based on residency. And if you’re a resident of the city, that tax gets paid to the city rather than the county.

Monroe County council member Eric Spoonmore says that and other tax shifts could amount to a $3.7 million cut to county government.

“There are going to be impacts on many of the county's funding sources including local income tax, public safety, income tax, motor vehicle, highway, food and beverage tax, wheel tax, and excise tax.”

Spoonmore says he’s worried annexation will make it more difficult to fund county-wide services such as the health department and the criminal justice system.

Bloomington Annexation Revenue and Costs
Analysis of revenues over costs showing debt in first year as city adjusts to providing services to annexed areas. (City of Bloomington)

Hamilton says it does relieve the county from providing some services.

“One thing the fiscal analysis showed was that the county will actually have more revenue per road mile they're responsible for after annexation compared to before,” Hamilton said.

The county would lose about 84 miles of road miles – 11 percent of its total.

Remonstration

New legislation may make it easier for homeowners to challenge annexation.

Certain properties have annexation remonstrance waivers associated with them – it prohibits the owners from challenging annexation in exchange for city services, such as water and sewer. Many of them date back years, and still stand even if the property changes hands.

The Indiana legislature put a 15-year cap on those waivers in 2019. So any waiver before 2006 is invalidated.

The city has identified 3,200 parcels subject to those waivers. But Thomas says the data isn’t clear.

“The problem is that they did not delineate in this report which of these 3,200 sewer waivers are expired,” Thomas said.

Association of Indiana Counties government relations director Ryan Hoff says after an annexation ordinance passes, the remonstrance period kicks in.

READ MORE: Bloomington City Council Removes 1 Of 9 Zones From Annexation Plan In 2017

Landowners within the annexation area can file with the county auditor to remonstrate, or protest the annexation.

“If 65% of the land owners remonstrate, then the annexation is invalidated. If 51% of the land owners remonstrate, then they can get entry into the court system to fight it through the court system,” Hoff said.

He says there are legal costs associated with that and residents would have to prove to a judge city services provided don’t warrant annexation.

While property owners have remonstrance, Hoff says other taxing units that stand to lose out on revenue such as counties, school corporations, and public libraries don’t have standing in court.

“So it's kind of a unilateral decision on part of one unit of little local government to get to kind of claim these revenue sources that all units are relying on,” Hoff said.

Bloomington Mayor John Hamilton
Bloomington Mayor John Hamilton (Zoom interiew)

READ MORE: Bloomington Council Votes To Exclude Cook From Future Annexation

The proposed annexation is substantial so the financial ripple effect on taxing units will be too. But Hamilton says the city has no choice, annexation should have been ongoing for the last 17 years.

“We need to catch up or we will always be behind and won't be able to catch up.”

Hamilton says annexation allows new residents to vote in city elections. But Jenshak says, it doesn’t make a difference.

“We tend to be more on the on the conservative side. And Bloomington always goes liberal, I don't think my vote would really matter that much.”

Jenshak and other annexed residents won’t get to vote in the next election anyway. The remonstrance period goes until Jan. 1, 2024, when any approved annexations take effect… right after 2023 municipal elections.

Read more on the city's annexation page.

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