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Deannexation: Initiation by Residents and Landowners under Limited Circumstances

When a city has failed to fully implement a plan of services adopted for an annexed area, residents and landowners’ only recourse under current law is to sue the city to provide the services.  Although deannexation may seem to be a reasonable alternative and one that might be acceptable to the city, residents and owners have no way to initiate or even participate in the deannexation process except by petitioning to force a vote in hopes of stopping a deannexation.  One way to enable greater resident and landowner participation, including by those who own agricultural land, would be to allow them to petition for deannexation using the same formal dual-petition process proposed for annexation when a city has not fully implemented the plan of services adopted for the area.

Of the 36 states with deannexation laws, Tennessee is one of only ten that do not allow residents or owners to initiate deannexation proceedings.  Local officials in Tennessee have expressed concern that allowing residents to initiate deannexations could lead to donut holes and irregular boundaries that create confusion over provision of services.  In order to prevent these problems, eight states prohibit deannexations that would create donut holes by limiting them to areas on the city borders.

Tennessee, like many other states, allows cities to continue taxing deannexed property to repay debt incurred in order to meet the needs of those areas and requires them to charge sufficient rates for utilities to pay for services provided to those areas.  Because of this, allowing residents and landowners to petition for deannexation is unlikely to cause issues with provision of services as long as those deannexations are limited to areas on the city border in order to avoid creating non-contiguous islands and donut holes.  However, because counties may be obligated to assume responsibility for infrastructure such as roads or for emergency or other services, their approval for deannexation should be required.  Moreover, deannexations should be allowed only when the proposal is to remove the entire area as it had been annexed, not scattered individual parcels, unless the city and county agree otherwise.