Real Estate Blog

Ohio law empowers real property owners, acting collectively, to petition their local board of county commissioners to annex real property out of a township and into a municipality. If the subject property is less than 500 acres, shares at least 5% of its border with the annexing municipality, and does not contain an “island” of property that would remain within the township’s jurisdiction, the board of commissioners may not reject the annexation.

In 2024, a developer caused approximately 300 acres to be annexed from Bethel Township into the City of Huber Heights using a procedure known as an “Expedited Type-2 Annexation.” Reacting to this annexation, Rep. Adam C. Bird, representing House District 63 (Clermont County), and Rep. Jonathan Newman, representing House District 80 (Miami County), introduced House Bill 113 (“HB 113”), which will radically limit the power of property owners in a township to choose to annex their property into a municipal corporation.

Under HB 113, if adopted, a township opposing an annexation will require the county board of commissioners to determine that the proposed annexation serves the “general good” of the property and whether that “general good” outweighs the “detriments to the territory proposed to be annexed and the surrounding area[.]”A board’s findings on these questions are dispositive of whether it will accept a petition for Expedited Type-2 Annexation.

Will HB 113 have any substantive limitation on the power of county commissioners to refuse an Expedited Type-2 Annexation, especially given the broad deference courts afford to local governments? First, what is the “general good?” Does it serve the “general good” of a property to require that it continue being subject to township property tax rates instead of municipal tax rates? Does one zoning regime serve a property better than another? Does access to sewage services, instead of relying upon a septic system, better promote the “general good” for a property? Similar questions arise as to whether an annexation is to the “detriment” of the annexed and surrounding properties. Is an annexation to the detriment of surrounding properties if it eliminates a portion of the tax base of a vestigial governmental unit? Is it to the detriment of the surrounding property to annex real property into a jurisdiction that promotes development? Is it to the detriment of the annexed property to be subject to municipal tax rates and zoning? Currently, property owners choosing an Expedited Type-2 Annexation provide the answers to these questions. Under HB 113, though, county commissioners will have the final word.

In addition to empowering county governments to veto, and townships to filibuster, annexations, HB 113 inculcates other sea changes to Expedited Type-2 Annexations. The bill reduces the maximum acreage that may be annexed by 60% and increases the contiguous border requirements by 400%. HB 113 also extends the base timeline for Expedited Type-2 Annexations by at least 45 days, and potentially much longer, thus altering the opportunity cost of a given project.

Most important, though, is what HB 113 does not do. Ohio law currently requires that those petitioning for Expedited Type-2 Annexation “waive[] their right to appeal*** from the board of county commissioners’ entry of any resolution pertaining to this special annexation procedure[.]” HB 113 leaves this required waiver in place. As a result, once a board of commissioners denies an annexation petition, an owner cannot challenge that decision before a court on any grounds whatsoever. In other words, a board of commissioners’ decision as to whether annexation serves the “general good” of a property is absolute and final, even if that reason arises from animus towards a property owner or another unlawful motivation.

The changes wrought by HB 113 are adverse to those involved in real estate development and property owners generally; townships and counties may hold property hostage, even when landowners and municipalities express overwhelming and unanimous support for annexation. In the long term, HB 113 will make annexations more contentious, expensive, and time consuming. In the immediate term, HB 113 will subject property owners petitioning for annexation to the arbitrary and unreviewable discretion of county commissioners.