EAST WENATCHEE — East Wenatchee could see a bump in population and tax revenue if four proposed annexations are completed.

The city is negotiating with Douglas County on four annexations under recently approved legislation that allows governments to annex through an agreement between both parties rather than a vote or petition.

The city’s population could increase by an estimated 1,439 persons, or 10%, said city Community Development Director Lori Barnett. That number could increase another 3% once a few residential developments in the annexation areas are completed.

The proposed annexation areas are:

South Kentucky Avenue

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This area covers the area west of South Kentucky Avenue and South of 3rd and 4th streets. The inclusion of a number of car dealerships within the area, namely Town Toyota, Apple Valley Honda and Town Ford Lincoln, would be a significant sales tax revenue increase for the city.

Stone Ridge Subdivision

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This proposed area would cover part of the Stone Ridge subdivision, namely 56 homes and two empty parcels. The entire area is currently under residential zoning.

10th Street North East

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This area includes Evergreen Memorial Park & Mausoleum, orchards and a handful of homes. The entire area is currently under residential zoning.

Sand Canyon Estates Subdivision

Sand Canyon Area Parcel Map (1).jpg

Two empty parcels and 19 homes from the Sand Canyon Estates subdivision would be included in this annexation. The entire area is currently under residential zoning.

The city’s original proposal only included the South Kentucky area; however, the county submitted that the other three areas also be added. County Commissioner Marc Straub said those areas are pockets right along the city and county border.

“They don’t make good sense for the county to continue to provide urban services when the city is better equipped to provide those services,” he said.

Changes for residents

Once the county and city come to an agreement, they must provide 30-days notice to special districts like fire and water. The city would also send out an explanation of the process and a list of what would and wouldn’t change to each resident of the annexation area.

Barnett said residents in the annexation areas shouldn’t see any impact in regards to special purpose districts like water, sewer and parks since rates are the same in the city and county. However, she added it’s too soon to know how residents’ tax rates would change since 2022 taxes are not yet finalized.

“I just know that historically, city tax rates are less than the county road tax rate,” she said. “Since the city tax replaces the county road tax, that part of their tax bill will be reduced.”

Becoming a city resident would also mean changes in day-to-day services, such as dealing with East Wenatchee Police rather than the Douglas County Sheriff’s Office or going to municipal court instead of district court.

Developers would also need to be aware of where they are at in their permit process when the annexations take place. If a building permit is completed by the county, the county would continue to administer it until the building is completed. However, if the permit is in progress, administration would be transferred to the city.

Straub said he thinks the transition would be fairly seamless for residents.

“From the county’s perspective, it’s about how do we minimize that impact moving forward for the citizens,” he said. “I think the best way to do that is through a well thought-out interlocal agreement. You just stand a far better outcome than just by petition or some other method.”

Changes for the city and county

The annexations would be a numbers game for the city and county governments. The city could pay the county $1.5 million total for the four annexations over the span of four years, said Straub. In an earlier comment, Barnett said the city was planning on paying the county $375,000 a year for three years, or $1.1 million total. 

“It affords the county the opportunity to kind of get weaned off of the taxes that they would typically be collecting in these areas,” she said. “But it relieves them of the responsibility to provide services. So there’s just kind of a little bit of give and take there.”

Straub said although the annexation would represent a loss in revenue, the county is comfortable with the current agreement.

The city would likely come out better financially compared to previous annexations. The city hasn’t annexed county property since 2006, but the city paid the county over $1 million each on prior annexations, said Barnett.

“We were trying to do one about every four or five years because it took us that long to recover,” she said. “It was a big financial hit to us.”

This time around, there are no large recent road improvement projects the city would need to repay the county for, and the city would share less tax revenue.

The biggest increase in tax revenue for the city would be sales tax, particularly in the South Kentucky Avenue annexation area. But the city would also be able to collect additional property taxes, utility taxes and car tab fees.

The city would take over maintenance of the streets within the area. The extra responsibility would likely require an additional employee and another plow truck.

The city only occupies 30-35% of its urban area, meaning it still has a lot of room to grow. This is different from neighboring cities like Rock Island and Wenatchee, which occupy upward of 85% of their growth areas, said Barnett.

She added that expanding city limits would attract more economic development since most people don’t realize that while the city’s population is just 14,000, the urban area’s population is closer to 30,000. A larger official population would mean the city is eligible for more state money.

Barnett stressed that since the city has not yet finalized an agreement with the county, there may be changes to the terms of the annexation or the annexed areas themselves before the process is finalized. If the current annexations go well, the city hopes to do annexations on a more regular basis.

“We recognize that we really need to start growing into our urban area,” she said. “It is to our benefit, community wide, to have the incorporated area larger and have less folks living in the unincorporated area.”

This story has been updated to clarify Commissioner Marc Straub's comment about how much revenue the city would share with the county. 

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