Annexation Strategies & Financial Impacts

What is Annexation?

Annexation is the term used for a municipality to propose a boundary change to expand its land area in order to allow for future growth opportunities. Properties within an annexation area experience a change in jurisdiction from one municipality to another. Annexation does not change ownership rights and is not necessarily undertaken to facilitate immediate development, but rather to secure lands for future growth.

Annexation Model

The CORVUS Annexation Model is a proprietary tool that allows us to quickly determine the financial impact of annexation on both the municipality doing the annexing (often and urban area) and the municipality whose lands are being annexed (often a rural area). This financial impact assessment is one of the two key documents (along with expert testimony) that must be provided to the Municipal Government Board in order to finalize an annexation. Our model enables municipalities to:

  • Create a multi-year Capital Infrastructure Plan that will support the development in the annexation area (e.g., roads, water, sanitary, stormwater, fire stations, etc.).
  • Create a multi-year Capital Infrastructure Financing Plan (e.g., grants, tax levy, offsite levies, utility charges, etc).
  • Create a multi-year Operating Plan that will support the annexation area (e.g., programs, labour costs, maintenance, etc.).
  • Project growth of the municipality‚Äôs existing tax assessment base, along with the growth of the assessment base in the annexation area.
  • Validate existing capital and operating support to the County/MD whose lands are being annexed. This is crucial to understanding the actual financial impact on the County/MD.
  • Create a Revenue / Recovery Plan.
  • Determine the tax impact on the municipality and on the annexation area.
  • Develop impact mitigation strategies. Often, rural residents have lower tax regimes than residents of urban centers. As such, tax relief may be sought for the annexation area by impacted land owners. In addition, annexation may result in one municipality holding stranded costs associated with capital facilities transferred as a result of annexation. In such cases, the municipality may ask that debts be assumed by the annexing party as a condition of approving the annexation.
  • Resolve issues identified during community consultation (a legislative requirement), or consultations with other public authorities, and determine the financial ramifications of these resolutions
    Analyze the impacts of annexation on the municipality whose lands are being annexed
CORVUS Annexation Model Control Panel

CORVUS Annexation Model Control Panel (click to enlarge)