Tax revenue snag prompts Lewisville to delay proposed annexation of Castle Hills

The main reason for the delay is that the city of Lewisville will not be able to receive any property tax revenue from Castle Hills until January 2022, according to information the Denton Central Appraisal District shared with the city.  (Photo courtesy Bright Realty; Tobi Carter/Community Impact Newspaper)
The main reason for the delay is that the city of Lewisville will not be able to receive any property tax revenue from Castle Hills until January 2022, according to information the Denton Central Appraisal District shared with the city. (Photo courtesy Bright Realty; Tobi Carter/Community Impact Newspaper)

The main reason for the delay is that the city of Lewisville will not be able to receive any property tax revenue from Castle Hills until January 2022, according to information the Denton Central Appraisal District shared with the city. (Photo courtesy Bright Realty; Tobi Carter/Community Impact Newspaper)

The proposed annexation of the Castle Hills community by the city of Lewisville has been delayed until December 2021.

The coronavirus pandemic slowed some of the progress related to annexing the community into the city. But the main reason for the delay is that the city of Lewisville will not be able to receive any property tax revenue from Castle Hills until January 2022, according to information the Denton Central Appraisal District shared with the city.

This would be true regardless of when the annexation might take place, which makes an earlier annexation date impractical for the city, according to Brenda Martin, Lewisville's Castle Hills annexation coordinator.

"If those properties aren't going to be on the city's tax roll until Jan. 1 of 2022, then the first budget year those properties will avail revenues for the city will be the fiscal year [2022-23]," Martin said.

Castle Hills is in an unincorporated part of Denton County and has commercial properties as well as more than 15,000 residents who would become Lewisville city residents if the annexation is approved.


With the new date of annexation in mind, the city is continuing its preparations for the change, including heading up an advisory committee that will kick off in September. The committee will include Lewisville City Council members, Castle Hill residents and Lewisville residents, including some who serve on city boards.

The committee will help continue educating residents in both communities about the annexation, Martin said. They will also take input from residents and advise Lewisville City Council on its direction and decisions.

Lewisville council members agreed in June to move forward with creating the advisory board.

"We're meeting members of Castle Hills all together, so we can start laying out all the issues we are going to address, develop [and] research whatever areas residents may still have concerns on," Martin said. "Those districts can then feel confident in their ability to understand the issues and to approve an annexation amendment."

The delay will also give the city time to begin working hand-in-hand with the water districts within Castle Hills to prepare budgets for the final years leading up to annexation. Castle Hills communities will need to prepare budgets for a full year during the summer of 2021, Martin said.

"We need for them to understand they've got to really budget a full year of services even though we might annex in December," Martin said. "We'll take over the services, but there's no revenue to pay for them from our own revenues, so we have to have the district revenues coming in ... to help pay for the rest of that year."

Editor's note: This story has been updated to correct the name of the Denton Central Appraisal District.
By Liesbeth Powers
Liesbeth graduated from Baylor University with a degree in new media journalism in December 2018. She gained her newspaper experience as a staff writer and multimedia editor at her campus paper, The Baylor Lariat. Liesbeth joined the Community Impact team in August 2019, where she reports on all things Plano and Richardson, including Plano City Council and Dallas Area Rapid Transit.


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