For Magnolia—a city of more than 1,500 residents—growing its population thirtyfold over the next decade is possible despite the geographic growth of neighboring municipalities, City Administrator Paul Mendes said. With commercial, residential and thoroughfare development within reach, Mendes said growth of the city’s boundaries is likely since developers often petition the city for annexation.
“We’ve got tremendous potential both north and east [of the city],” he said. “If everything goes fairly normally, in the next 10-12 years, we could have 60,000 or 70,000 people living in Magnolia.”
According to city officials, the cities of Magnolia and Tomball adopt land into their city limits via voluntary annexation, meaning property owners petition the city for annexation rather than the city initiating the annexation. Voluntary annexation imposes no limit on how much land the cities can annex annually, officials said.
“As long as the property is within the [extraterritorial jurisdiction] and contiguous [to city limits], it can be annexed upon their request to do so,” Tomball Community Development Director Craig Meyers said.
However, Magnolia and Tomball cannot annex land within another city’s ETJ—an unincorporated area outside a city’s limits the city can annex. As a result, geographic growth of Magnolia and Tomball is dependent upon interest by developers and the rate at which neighboring municipalities grow.
Several developments are slated for the Magnolia area, pending the extension of the Tomball Tollway—the tolled portion of Hwy. 249 due to be complete in early 2020—as well as the completion this fall of the FM 1488 overpass over FM 149, Mendes said.
Mendes said residential and mixed-use developments, such as Reynolds Reserve, Escondida, Magnolia Woods, the Woodard Tract—a 6,000-acre community—and Magnolia Audubon—a 2,600-acre community—are estimated to bring in between 500 and 20,000 homes each upon build-out. Accounting for about three residents per home on average, Mendes said he expects growth to surge in the area as the Tomball Tollway comes to fruition.
“[Hwy.] 249 I think is going to be a real lifeline to this part of the [county],” he said. “There’s a lot of land out here, and that’s why [Hwy.] 249 was so important to us. We’ve had land that has been primed for developing for years, but [developers] don’t have roads [to the undeveloped land].”
Several municipalities—each able to annex land within their extraterritorial jurisdictions—are near the cities of Magnolia and Tomball. Cities can annex land only up to the neighboring city’s ETJ boundary unless the neighboring city consents to the release of property from its ETJ.[/caption]
The Tomball Tollway will stretch through Montgomery and Grimes counties to Hwy. 6 in Navasota, cutting across FM 1488 to the east of Magnolia’s existing city limits and providing an alternate path around the city via a proposed bypass route.
Although many of the proposed developments are outside city limits, Tana Ross, Magnolia economic development coordinator and planning technician, said she believes the city’s 4.5 square miles could stretch from Magnolia High School westward to the Waller County line on FM 1774 as planned developments petition the city for annexation.
“Truly other than the Conroe ETJ, which is along FM 1488 near Community Drive, we have a very large area of undeveloped land that could be incorporated in the city,” she said. “We are looking at the possibility of taking in thousands of acres with developers who have already asked to be a part of the city.”
Mendes said the city is working to entice developers to join the city by offering to extend water and sewer services to undeveloped properties.
Developers often seek annexation to receive water, sewer, police and fire services, which the city must provide within 2 1/2 years of annexation. In return, the city receives property and sales tax revenue generated by the development.
“We have to be very cautious of what we do because we don’t want to bite off more than we can serve,” he said. “But we want to offer our services so we can control the growth around us.”
Annexation limits in Tomball
Regardless of developer interest, both Magnolia and Tomball can annex land only up to the ETJ boundaries of neighboring cities unless the neighboring city consents to the release of property from its ETJ. According to the Texas Local Government Code, the city’s number of inhabitants determines the size of a city’s ETJ—ranging from a half-mile to 5 miles. As a city’s population grows, the size of its ETJ can incrementally increase.
Although Tomball could pursue unilateral annexation—annexing land without the consent of the property owner—doing so requires the city to have an annexation plan, which Tomball has chosen not to create, Meyers said.
“We did not choose to do any initiated annexations,” he said. “They’ve all been property owners coming to the city asking to be annexed into the city for city services for the most part.”
The geographic area into which Tomball can expand is limited, as Tomball’s ETJ abuts the city of Houston’s ETJ, Meyers said. To expand Tomball’s ETJ, property owners must petition Houston for release from its ETJ.
As the ETJ boundaries constrain the geographic size of Tomball, City Administrator George Shackelford said property and sales tax revenues could plateau, should all of the land within reach be developed. However, increasing property values and sales tax revenue make this scenario unlikely, Shackelford said.
Annual sales and property tax revenues increased 12 percent and 19 percent, respectively, for the city between 2013 and 2016, according to budget data and the Texas Comptroller’s website.
According to the city’s budget, property and sales tax revenues in fiscal year 2015-16 made up 70 percent of the city’s general fund revenue. The general fund pays for personnel, office supplies, maintenance, legal services, fire and police department operations and improvements to city parks and streets.
“I can see where it could [plateau], but we’ve not had that problem. We’ve had so much good commercial growth, retail and new houses,” Shackelford said. “It may down the line [plateau], but right now, we’ve seen not a huge increase [in the values], but it’s been substantial to sustain what we need to do and still make improvements.”
Despite limited extraterritorial jurisdiction boundaries, Tomball and Magnolia city officials said sales and property tax revenues are unlikely to plateau as commercial and residential development continues within the cities.[/caption]
In addition to Houston’s ETJ, the cities of Plantersville—its residents voted in May to incorporate—Stagecoach, Todd Mission and Conroe also pose a challenge to how far the cities of Tomball and Magnolia can grow.
Conroe’s ETJ limits Magnolia from annexing farther east along FM 1488 and collecting additional sales tax revenue from developments in that area.
A city can receive sales and property tax revenues only from those developments within its limits.
Sales and property tax revenues increased 17 percent and 22 percent, respectively, for the city of Magnolia between 2013 and 2016. However, revenues decreased from 2015 to 2016.
Although receiving additional revenue is an incentive to annex, no city can annex more than 10 percent of its geographic mass in any given calendar year when annexing unilaterally, according to the Local Government Code.
“The way we’ve been working it, folks have been petitioning us for annexation, so we don’t have a limit,” Mendes said.
Once Magnolia’s city population reaches 5,000 residents, the city’s ETJ boundary can increase from a half-mile to 1 mile beyond city limits. Additionally, the city can choose to move from a general law municipality to a home rule municipality governed by its own charter.
General law municipalities like Magnolia are subject to the Local Government Code and primarily annex land via voluntary annexation, meaning property owners petition the city for annexation. Home rule municipalities, which have a population of more than 5,000 residents—such as Conroe and Tomball—can annex land without a property owner’s consent if the city creates an annexation plan.
Mendes said he foresees Magnolia reaching this mark shortly after Hwy. 249is completed in 2020, opening up undeveloped land for annexation.
“I’d say within a year and a half to two years after that we would be pushing the 5,000 population,” he said. “As far as annexation [goes], we’ve got plenty of room out here to grow.”