New residents in Round Rock might not realize when they are buying a home outside the city limits on county land referred to as the extraterritorial jurisdiction, or ETJ. Though the line is invisible, there are significantly more restrictions on what types of buildings can be built on land within the city limits than on land within the ETJ, or land immediately outside the city limits the city has reserved the right to annex later.

City officials say to protect residents living near the ETJ they might use annexation, or bringing land outside the city into it. However, when annexation is involuntary it can be “more difficult,” Mayor Alan McGraw said.

To avoid involuntarily annexing land, in many cases the city of Round Rock for the past year has been using annexation agreements, said Round Rock Director of Planning Brad Wiseman.

How agreements work

These agreements between property owners and the city state that property owners with an agricultural land use will not be annexed into the city until the property owner seeks to put commercial or residential developments on the land. That way if the land is developed the city will ensure it meets development standards, Wiseman said.

“To be better able to protect residents we would annex [property being developed] to ensure the use is compatible with the surrounding area,” he said. “Even if you [build] a shopping center, we have minimum landscape requirements and buffer requirements to ensure the people next to it are protected. You don’t have that protection when the land is in the county.”

McGraw said annexation agreements get “the best of both worlds” from voluntary and involuntary annexation.

“It’s a way of getting some certainty on both sides,” McGraw said. “(Property owners) aren’t going to throw up an incompatible use, which they could, but we aren’t bringing them into the city. It’s a nice tool to have kind of in between annexation and not doing anything.”

Wiseman said in an involuntary annexation, the city is responsible for extending utility lines to the annexed land in a set amount of time, which can be expensive. However, if the owner signs an annexation agreement and proceeds to develop the land, the annexation is then considered voluntary, and the property owner is responsible for extending the utility lines.

Reasons for agreements

Wiseman said as a city grows there are “pockets” of land on the edges of the city limits that do not get annexed because they retain an agricultural land use. He said when those pockets form is when the city would employ an annexation agreement to ensure it does not develop into an undesirable use.

Wiseman said if no annexation agreement is utilized and the land in the ETJ is developed its uses could range from an RV storage facility to a chicken processing plant.

Wiseman said taxes from potential developments in newly annexed land would help pay for city services routinely used by the residents or businesses.

“The residents [of a new subdivision] will use city services, drive on city streets,” he said. “If you live anywhere in Round Rock chances are you’ve been to Old Settlers Park. [...] It makes sense to have revenues to support those services for everyone.”

McGraw said the average single-family home generates less in property taxes than the amount of money required to pay for the services that house uses. He said large commercial developments usually come to the city and ask to be annexed because they need the city services provided.

“I’m trying to think of anything we’ve annexed in 15 years that was tax-based,” McGraw said. “I can’t think of a single one.”