ATTORNEYS FOR APPELLANT ATTORNEYS FOR APPELLEE
Mark E. GiaQuinta Edward L. Murphy, Jr.
Robert W. Eherenman Larry L. Barnard
Haller & Colvin, P.C. Miller Carson Boxberger Fort Wayne, Indiana & Murphy LLP
Fort Wayne, Indiana
J. Timothy McCaulay
Helmke, Beams, Boyer & Wagner ATTORNEY FOR AMICUS CURIAE
Fort Wayne, Indiana INDIANA ASSOCIATION OF
CITIES AND TOWNS
D. Randall Brown
Barnes & Thornburg
Fort Wayne, Indiana
CITY OF FORT WAYNE, ) ) Appellant (Respondent Below ), ) No. 02S05-0109-CV-412 ) in the Supreme Court v. ) ) CERTAIN SOUTHWEST ANNEXATION AREA ) No. 02A05-0002-CV-77 LANDOWNERS, ) in the Court of Appeals ) Appellees (Petitioners Below ).)
March 12, 2002
On February 4, 1997, Remonstrators challenged the annexation, claiming that the Fiscal Plan
was legally insufficient. On January 11, 2000, the trial court issued its
Findings of Fact, Conclusions of Law, and Judgment in favor of the Remonstrators.
The City appealed, arguing that there was insufficient evidence to support the
trial courts conclusions that:
the Citys Plan was deficient in calculating cost estimates for the planned services to be provided to the annexed area;
the City failed to provide in its Plan that it would deliver noncapital
and capital improvement services to the annexation territory within the statutorily fixed periods
the City improperly used a City-wide standard in comparing services to be provided
to the annexation area to services currently provided within the City; and
the City was required by statute to provide a neighborhood park in the
annexation area similar to a neighborhood park located in the comparable area of
See Appellants Br. at 5-9.) The Court of Appeals affirmed, finding the
first issue dispositive. In re Ordinance No. X-03-96, 744 N.E.2d 996, 1003
(Ind. Ct. App. 2001). We granted transfer, vacating that opinion. 761
N.E.2d 412 (Ind. 2001).
Although the municipality bears the burden of proof when properly challenged, we afford
the municipalitys legislative judgment substantial deference. Therefore, a trial court should not
audit a challenged fiscal plan. Rather, it should focus on whether that
plan represents a credible commitment by the municipality to provide the annexed area
with equivalent capital and non-capital services.
B. The Appellate Courts Role. When a trial court enters special findings,
as is the case here, we review issues of fact for sufficiency of
the evidence and look to the record only for evidence favorable to the
judgment. Ind. Trial Rule 52; Rogers, 688 N.E.2d at 1240. We
do not set aside findings and judgments unless they are clearly erroneous.
T.R. 52. We review questions of law de novo. Rogers, 688
N.E.2d at 1240.
. . . .
That planned services of a noncapital nature, including police protection, fire protection, street
and road maintenance, and other noncapital services normally provided within the corporate boundaries,
will be provided to the annexed territory within one (1) year after the
effective date of annexation, and that they will be provided in a manner
equivalent in standard and scope to those noncapital services provided to areas within
the corporate boundaries that have similar topography, patterns of land use, and population
That services of a capital improvement nature, including street construction, street lighting, sewer
facilities, water facilities, and stormwater drainage facilities, will be provided to the annexed
territory within three (3) years after the effective date of the annexation, in
the same manner as those services are provided to areas within the corporate
boundaries that have similar topography, patterns of land use, and population density, and
in a manner consistent with federal, state, and local laws, procedures and planning
Ind. Code Ann. § 36-4-3-13(d)(West Supp. 1996).
In Bradley v. City of New Castle, slip op. at 12, we observed
that Section 13 is a pretty straightforward directive: a court shall order
annexation if a municipality satisfies Section 13s requirements. The question we address
in this case is whether the trial court examined this Plan under too
powerful a microscope.
Second, requiring a written plan makes the opportunity for remonstrance and judicial review
more realistic. As a practical matter, more than vague promises are needed
for a court to test a citys ability to provide like services to
the annexed territory. Id. at 1378. Here, the trial courts extensive
findings and conclusions again make clear that this Plan allowed for thorough review.
Third, a fiscal plan needs to be in writing to protect the right
of landowners to institute proceedings to force an annexing city to provide the
services promised under the plan. Chidester I, 596 N.E.2d at 1378.
Our analysis of each of the Citys contentions will focus on whether the
Plan fulfills this third purpose.
B. Must Cities Forecast the Future? The trial court held that
Section 13(d) requires annexing municipalities to project cost estimates forward to the effective
annexation date. (R. at 532.) The Court of Appeals agreed, saying
we believe that cost estimates for noncapital services must be figured from one
year after the effective date of annexation and for capital improvement services, three
years after the effective date of annexation. In re Ordinance No. X-03-96,
744 N.E.2d at 1002.
We think the statute is not so prescriptive as that. Section 13(d)
does not speak in terms of projections, forecasts, or inflated costs; it merely
requires cost estimates. These cost estimates are not, as the Court of
Appeals said, irrelevant and arbitrary if they are stated in current dollars.
Id. at 1003. They are the means by which the municipality demonstrates
its financial capacity to provide the services described in Sections 13(d)(4) and (5)
at the time it authorizes an annexation.
Here, the City undisputedly provided cost estimates. The trial court found, The
written annexation Fiscal Plan for the Southwest Extended Annexation Territory . . .
showed: . . . . B) Cost estimates of planned services to be
furnished; . . . . (R. at 510.)
Nonetheless, the trial court found the estimates legally deficient because they reflected the
status quo at the time the Ordinance was passed, inflated at an estimated
rate of three percent annually.See footnote (R. at 532-34.) The essence of
the trial courts rationale was: Section 13(d) speaks of services
provided, so fiscal plans must forecast each individual service and its related costs.
Projecting such services and costs ten or more years in advance is,
as various City officials admitted, extremely difficult or impossible with any degree of
accuracy. Therefore, the trial court reasoned, this annexation fails.
The trial courts reasoning creates an implicit limitation on annexation deferral periods. This runs counter to Section 8(1), which in 1996 explicitly allowed unlimited deferral. We will not read Section 13 in a way that effectively eliminates an option that Section 8(1) offered at the time the City passed the Ordinance.
We conclude that Section 13 does not require more than credible calculation of
present costs of individual services adjusted forward to account for inflation. Based
upon the finding of fact that the Plan did contain cost estimates of
planned services to be furnished, the Plan passed legal muster in this respect.
C. A Commitment to Deliver. Although the trial court held against the City on grounds of inadequate forward cost projections, it entered findings of fact covering most of the services listed in Sections 13(d)(4)-(5), plus some that were not listed. As to police service, the court found:
67) Upon the effective date of the annexation, the City will add ten (10) additional police officers to provide a coverage of two (2) police patrol officers per shift in the Annexation Territory. The City will also add one (1) police detective and one (1) police supervisor. The anticipated calls for service in the Annexation Territory would be six thousand seven hundred ten (6,710) runs per year requiring approximately five thousand (5,000) police hours. The call for service is the common element that drives police staffing.
(R. at 519.) As to fire protection, the court said:
17) There are three (3) new fire stations that will be constructed to serve the Southwest Extended annexation territory located at:
a) Getz Road and Constitution Drive
b) Scott and Covington Road
Liberty Mills and Ellison Road
18) The projected response times from these three (3) new fire stations that will serve the Southwest Extended annexation territory are within the same range as the average response times in the Comparable area.
(R. at 510-11.) The court discussed street and road maintenance at some
length, and found:
52) The City Street Department provides a surface maintenance service which includes anything from patching a pothole to putting an overlay on a street in all areas of the City, and, upon annexation, will provide the same surface maintenance service to the Annexation Territory.
53) The City plans to provide immediately upon annexation general street maintenance by incorporating
the Annexation Territorys nineteen and ninety-four hundredths (19.94) miles of arterial and collector
streets and ninety-four and seventy-nine hundredths (94.79) miles of residential streets into the
Citys street maintenance program, which level of service is standard for the City.
(R. at 516.)
See footnote As to water and sewer facilities:
60) The Citys Water Utility presently serves a portion of the Annexation Territory. Presently, a privately owned public utility provides water for human consumption to the balance of the Annexation Territory not presently served by the Citys Water Utility.
61) Upon annexation, residents of the Annexation Territory who utilize the services of the
Citys Water Utility will pay the same in-city rate as those residents of
the Comparable Area would pay.
62) In 1996, a portion of the Comparable Area was served by the same
privately owned public water utility that services a portion of the Annexation Territory.
Upon annexation, residents of the Annexation Territory not currently served by the
Citys Water Utility will be permitted to petition the Citys Board of Public
Works for water service extension which is the same process and procedure presently
available to residents of the Comparable Area who are not presently served by
the Citys Water Utility.
63) There are some areas of the Annexation Territory currently served by the
Citys Sewer Utility. Upon annexation, the residents of the Annexation Territory served
by the Citys Sewer Utility would pay the same rate as would be
charged customers of the Citys Sewer Utility located in the Comparable Area.
64) Other portions of the Annexation Territory are served by . . . a
privately owned public utility . . . [having] a certificate of territorial authority
(CTA) which grants exclusive jurisdiction, under Indiana law, to provide sanitary sewer service.
The City is not authorized, or permitted, by Indiana law, to extend
City sewer service within the CTA.
65) If additional sanitary sewer service is needed in the Annexation Territory outside the
CTA, the Citys Sewer Utility has the capacity to provide such service. .
(R. at 517-18.)
The trial court found that the City had made additional commitments beyond the
services specifically listed in Section 13(d)(4) and (5), such as:
28) The City plans to provide full advanced life support ambulance service immediately upon annexation to the Annexation Territory through the Citys agreement with the Three Rivers Ambulance Authority as well as extra emergency assistance through the Citys fire department.
29) . . . Solid Waste Manager for the City, testified that this service is one hundred percent (100%) funded by users fees, and [the City] will provide the Annexation Territory with the same service as the Comparable Area . . . .
. . . .
33) Upon the effective date of annexation, the Citys Animal Care and Control Department will add two (2) animal control officers and one (1) animal care specialist as well as two (2) vehicles for the new animal control officers to serve the Annexation Territory.
. . . .
39) The Citys Parks and Recreation Department operates a street tree program within the
corporate boundaries of the City, including the Comparable Area. Upon annexation, residents
of the Annexation Territory will be permitted to participate in the Park Departments
street tree program under the same procedures by which residents of the Comparable
. . . .
42) The city plans to provide to the Annexation Territory upon annexation engineering services
for traffic control which would include investigation of the need for, and the
installation and maintenance of, traffic control devices, which level of service is standard
for the City . . . .
(R. at 512-15.)
These detailed findings of fact demonstrate that the Plan was legally sufficient to fulfill the third purpose of fiscal plans, which is protecting the annexed landowners future rights to enforce service promises. The City has made enforceable commitments to provide all major City services to the annexed area on an equivalent basis. That is what Section 13(d)(4) and (5) require.
D. The Basis of Comparison. The trial court concluded that the Plan failed, in part, because:
All of these [Section 13(d)(4)-(5)] services must be provided in the same manner as they are and will be provided to the Comparable Area. No one used the Comparable Area in determining the services. . . . The Court concludes that the City is not homogeneous in nature in noncapital and capital improvement services, and City-wide services cannot be used.
(R. at 531-32.) This assumes that a municipality must identify a particular comparable area when it annexes new territory and irrevocably commit to providing the two areas with identical services.
The Statutes requirements are not this rigid. In Chidester I, we
The qualification in [Section 13](d)(4) and (5), that services be equivalent to those in the city with similar topography, patterns of land use, and population density, provides a guidepost for cities in determining what services should be provided to the annexed territory. It would be unreasonable to require the city to provide services to the annexed territory that are not needed because of differences in topography, patterns of land use, and population density. For example, storm drains may be provided in neighborhoods which are very flat and have no natural drainage; such drains are not often provided in areas where the topography provides natural drainage. The idea is to provide like services to like areas.
596 N.E.2d at 1378.
In Chidester II, 631 N.E.2d 908, we examined a few important services to
test the fiscal plan against the Section 13 equivalency requirements. We take
the same approach here.
One of the most important services any municipality provides is police protection.
The trial court found that call for service volume drives the Citys police
staffing, and that the City estimated annexation area police staffing based on the
Citys average service call volume. (R. at 519.)
Call volume is a reasonable basis for projecting law enforcement needs, and its
application in the Plan will allow the annexed citizens to enforce their right
to equivalent services. After annexation, the City may certainly allocate greater police
resources to areas that have especially high crime rates. If, however, citizens
in the annexed area receive a lower quality of service than citizens in
similarly populated areas that have comparable call volumes, the annexed citizens have a
basis for demanding more equitable treatment. The Citys approach therefore adequately assures
like services to similar areas, which, as we stated in Chidester I, is
the trial courts proper focus.
Fire protection is also a major component of municipal service. The court
here found that the three new fire stations promised to the annexed area
would offer response times within the same four- to seven-and-a-half-minute range as average
response times in a defined Comparable Area. (R. at 510-11.) Again,
this promise is sufficiently specific to allow annexed landowners to enforce their future
We next turn to a capital service, i.e. sewer facilities. The trial
court found that the City is already providing sewer service to those annexed
citizens it is currently authorized to serve, that other parts of the area
are already served by a private utility holding a license from the Indiana
Utility Regulatory Commission, and that [i]f additional sanitary sewer service is needed in
the Annexation Territory outside the [private utilitys area], the Citys Sewer Utility has
the capacity to provide such service. (R. at 518.) Annexed citizens
using City service will pay the same rates as other charged customers.
(Id.) These findings demonstrate that the Fiscal Plan is adequate with respect
In summary, courts reviewing annexation challenges should focus on whether the municipality made
credible and enforceable commitments to provide equivalent services to similar areas. Courts
are not authorized to dissect the minutiae of what are essentially legislative decisions.
Based on the courts factual findings, the Fiscal Plan suffices.
E. No Entitlement to a Park. The trial court found:
40) The services to be provided by the Citys Parks and Recreation Department to the Annexation Territory are not equivalent in standard and scope to the services provided to the Comparable Area because the Comparable Area has an accessible neighborhood park and there will be no such accessible neighborhood park for the Annexation Territory. The City looks geographically for new parks. Parks are not located based on population density.
(R. at 514.) The Citys final argument is that the statute does not require it to provide a neighborhood park to the annexed area. (Appellants Br. at 25.)
As the City points out, a neighborhood park is a capital improvement and
falls under Section 13(d)(5). The trial court therefore erred in applying the
equivalent in standard and scope requirement that appears only in Section 13(d)(4), which
covers planned non-capital services. Capital improvement services must be provided in the
same manner that such services are provided to areas with similar topography, land
use patterns, and population density. Ind. Code § 36-4-3-13(d)(5). The trial
court found that the City chooses its park locations based on geographic considerations.
Therefore, providing park services in the same manner does not require the
City to create a neighborhood park in the annexed area.
Summary. Based on the trial courts findings of fact, the City
met its burden under Section 13(d) and was entitled to judgment. The
trial court therefore erred by entering judgment for the Remonstrators.
Dickson, Sullivan, Boehm, and Rucker, JJ., concur.