Background: Annexations and Population Determinations. Annexations by cities, towns, and code cities, while governed by separate statutes, share a common requirement for the annexing jurisdiction to determine the resident population of the territory to be annexed. Such population determinations must be accomplished using the practice of actual enumeration, conducted in accordance with the practices and policies, and subject to the approval of the Office of Financial Management (OFM), which uses the information supplied through the annexation process in annually calculating the population of all cities and towns in the state.

State-shared revenues from the gasoline tax, liquor board profits, and the liquor excise tax are distributed to cities on the basis of population as determined by OFM. For a city to have its population adjusted for an annexation for purposes of state-shared revenue distributions, OFM must certify the annexation, after which it notifies the appropriate state agencies of the population change.

For purposes of state-shared revenues, the revised city boundaries and the new population are not recognized until the date that OFM approves the annexation certificate submitted to it by the city.

Federal Census Blocks. The United States Census counts every resident in the United States. It is mandated by Article I, section 2 of the U.S. Constitution, takes place every ten years, and must be accomplished using actual enumeration. Among other purposes, decennial census data is used to determine the distribution of Congressional seats to states, to make decisions about what community services to provide, and to distribute federal funds to local, state, and tribal governments.

Census blocks are the smallest geographic area for which the U.S. Census Bureau (Bureau) collects and tabulates decennial census data. Generally, they are formed by streets, roads, railroads, streams and other bodies of water, other visible physical and cultural features, and the legal boundaries shown on Bureau maps.

Summary of Bill: The requirement for an annexing city, town, or code city to use actual enumeration to account for the population of territory to be annexed is modified to allow the annexing city to use federal decennial census data to account for the population of complete census blocks located within the territory to be annexed, as long as the date of annexation occurs within 18 months of the release of such data.

Annexing cities are still required to employ actual enumeration to account for the population of all partial census blocks located within the territory to be annexed, and to account for the entire population of the territory to be annexed if the date occurs more than 18 months after the release of such data.

Staff Summary of Public Testimony: PRO: This bill will save cities money and create efficiencies in a time of financial need. Annexation is an expensive process and cities, like the state, can not afford to spend money duplicating the same data already available through a census. In one municipality alone this bill will save $225,000 by not requiring that the city enumerate the population of the territory to be annexed. Allowing the use of federal census data released within a short period of time before annexation is reasonable. This is good government, a common sense bill.

OTHER: Population determinations effect statewide resource distributions. OFM takes these numbers very seriously but tries to balance costs to annexing jurisdictions with a need for accuracy. The current federal census data is not accurate. The federal process estimates where OFM uses actual enumeration. The bill needs to cite the correct federal census report.