City of D'Iberville, Mississippi v. City of Biloxi, Mississippi ( 2002 )

IN THE SUPREME COURT OF MISSISSIPPI
NO. 2002-AN-01075-SCT
IN THE MATTER OF THE ENLARGEMENT AND
EXTENSION OF THE MUNICIPAL BOUNDARIES OF
THE CITY OF D'IBERVILLE, MISSISSIPPI AND THE
CITY OF BILOXI, MISSISSIPPI: CITY OF
D'IBERVILLE, MISSISSIPPI
v.
CITY OF BILOXI, MISSISSIPPI
DATE OF JUDGMENT: 07/09/2002
TRIAL JUDGE: HON. J. SHANNON CLARK
COURT FROM WHICH APPEALED: HARRISON COUNTY CHANCERY COURT
ATTORNEYS FOR APPELLANT: JERRY L. MILLS
WALTER L. NIXON, JR.
ATTORNEYS FOR APPELLEE: JAMES L. CARROLL
ELIZABETH JANE HICKS
MARY LARGENT PURVIS
NATURE OF THE CASE: CIVIL - MUNICIPAL BOUNDARIES &
ANNEXATION
DISPOSITION: AFFIRMED ON DIRECT APPEAL AND ON
CROSS-APPEAL - 03/04/2004
MOTION FOR REHEARING FILED:
MANDATE ISSUED:
BEFORE SMITH, P.J., COBB AND CARLSON, JJ.
CARLSON, JUSTICE, FOR THE COURT:
¶1. Today’s appeal comes to us from a final judgment entered in annexation proceedings conducted
by the Chancery Court of the Second Judicial District of Harrison County, Mississippi, which had
consolidated for hearing three separate petitions: (1) a petition for annexation filed by the City of
D’Iberville; (2) a petition for annexation for the exact same area filed by the City of Biloxi; and (3) a
petition for inclusion into Biloxi of a smaller area within the proposed annexation area filed by residents of
this smaller area. After a trial was held on the consolidated actions, the special chancellor awarded a
portion of the proposed annexation area (PAA) to each city, including the inclusion area to Biloxi. The
remainder of the PAA was denied to both cities. Both cities have appealed the chancellor’s decision to
deny the entire PAA to that city and the decision to grant a portion of the PAA to the other city. The
inclusion petitioners have not participated in this appeal.
¶2. In both the briefs and at oral argument, the parties have invited this Court to address the doctrine
of prior jurisdiction as it relates to an annexation where there exist competing interests of more than one
municipality. Because that doctrine is at issue us in the case before us today, we accept that invitation.
FACTS AND PROCEEDINGS IN THE CHANCERY COURT
¶3. Since this appeal involves the filing of three separate petitions concerning the annexation efforts of
the City of D’Iberville and the City of Biloxi, the procedural history of each petition, as well as a petition
filed by Harrison County, will be briefly discussed.
(1) D’Iberville’s Petition:
¶4. The City of D’Iberville was incorporated in 1988. The area of the city is approximately 4.7 square
miles and, according to the 2000 census, had a population of 7,608 persons. In commencing its first
annexation effort since incorporation, D’Iberville, on October 5, 1999, adopted an ordinance seeking to
annex approximately 9.75 square miles to its north and west. On October 6, 1999, D’Iberville filed its
petition for approval of the annexation in the Chancery Court of the Second Judicial District of Harrison
County. The area sought to be annexed was an unincorporated area of Harrison County. The proposed
annexation area (PAA) consisted of approximately 9.75 square miles, had a population of approximately
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1,347 persons residing in 533 dwelling units, and had approximately 17 businesses. The PAA included
a subdivision known as Wells Ferry Landing. Harrison County filed a Petition to Intervene on December
8, 1999, and that petition was granted on December 20, 1999. Thereafter, on March 1, 2000, Harrison
County filed its Objection of Harrison County, Mississippi, To Petition For Ratification, Approval, and
Confirmation of an Ordinance Extending and Enlarging the Boundaries of the City of D’Iberville.
(2) Wells Ferry Landing’s Petition:
¶5. Without objecting to the D’Iberville annexation, on October 19, 1999, a group of citizens residing
in the Wells Ferry Landing subdivision filed a petition in the Chancery Court of the Second Judicial District
of Harrison County seeking inclusion into the City of Biloxi. The area sought to be included in Biloxi
consisted of a narrow east-west band, situated north of the existing city limits of D’Iberville. On November
17, 1999, the petition was amended, reducing the area sought to be included. The inclusion petition was
filed under a separate action, and it made no reference to the annexation attempt of D’Iberville.
Responsive pleadings to this inclusion petition were filed by Biloxi and D’Iberville on January 5, 2000.
(3) Biloxi’s Petition:
¶6. On December 29, 1999, Biloxi adopted an ordinance seeking to annex the entire PAA. As a third
action in the chancery court, Biloxi filed its petition seeking approval of the proposed annexation on January
19, 2000. The area sought to be annexedwas the same PAA as that sought by D’Iberville in its annexation
petition. Biloxi’s ordinance and annexation petition were both silent as to the D’Iberville proposed
annexation, although Biloxi’s annexation petition referred to the inclusion petition as support for Biloxi’s
annexation efforts.
¶7. Previously in 1995, Biloxi sought to annex approximately 54 square miles, including the present
PAA. After a trial, Biloxi’s annexation petition was partially approved; however, the present PAA and
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other territory was not included in the final judgment granting the annexation. We affirmed that decision
on July 29, 1999. In re Enlargement & Extension of the Mun. Boundaries of the City of
Biloxi, 744 So. 2d 270 (Miss. 1999). After the annexation, Biloxi consisted of approximately 38 square
miles. According to the 2000 census, Biloxi’s population was 50,644.
¶8. Without objection from any of the parties, the chancery court consolidated the three actions. A
trial was held before Special Chancellor J. Shannon Clark on July 16-19, 24-26, 31 and August 1-2,
2001. Harrison County and several individuals appeared at trial and objected to the annexation attempts.
After the parties submitted proposed findings of fact and conclusions of law, the court entered its own
Findings of Fact and Conclusions of Law on May 13, 2002. The Final Judgment Approving the
Enlargement and Extension of The Boundaries of the City of Biloxi, Mississippi was entered on June 21,
2002, granting the annexation in part but including the territory outlined in the inclusion petition. The Final
Judgment Approving the Enlargement and Extension of the Boundaries of the City of D’Iberville,
Mississippi was entered on July 9, 2002, granting the annexation in part. Both D’Iberville and Biloxi have
appealed these orders.
ANALYSIS
I. Statutory Procedure for Annexation
¶9. The procedure for annexation is governed by Title 21, Chapter 1, of the Miss. Code Ann. Both
D’Iberville and Biloxi adopted ordinances pursuant to Miss. Code Ann., § 21-1-27. Petitions were then
filed with the chancery court, as required by Miss. Code Ann. § 21-1-29. Notices by each city were given
by posting and publication pursuant to Miss. Code Ann. § 21-1-31. The petition for inclusion was filed
pursuant to Miss. Code Ann. §§ 21-1-45 & -47 and the required two-thirds of the qualified electors
residing in the territory executed the amended petition.
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¶10. At trial, each city bore the burden of proving that its proposed annexation was reasonable. Miss.
Code Ann. § 21-1-33. This Court has determined reasonableness by utilizing the following twelve indicia:
(1) the municipality's need for expansion;
(2) whether the area sought to be annexed is reasonably within a path of growth of the
city;
(3) the potential health hazards from sewage and waste disposal in the annexed areas;
(4) the municipality's financial ability to make the improvements and furnish municipal
services promised;
(5) the need for zoning and overall planning in the area;
(6) the need for municipal services in the area sought to be annexed;
(7) whether there are natural barriers between the city and the proposed annexation
area;
(8) the past performance and time element involved in the city's provision of services
to its present residents;
(9) the impact (economic or otherwise) of the annexation upon those who live in or
own property in the area proposed for annexation;
(10) the impact of the annexation upon the voting strength of protected minority groups;
(11) whether the property owners and other inhabitants of the areas sought to be
annexed have in the past, and in the foreseeable future unless annexed will,
because of their reasonable proximity to the corporate limits of the municipality,
enjoy the (economic and social) benefits of proximity to the municipality without
paying their fair share of taxes; and,
(12) any other factors that may suggest reasonableness, vel non.
In re Extension of the Boundaries of the City of Hattiesburg, 840 So. 2d 69, 82-83 (¶ 21) (Miss.
2003) (City of Hattiesburg) (citations omitted). However, “[t]he ultimate determination must be
whether the annexation is reasonable under the totality of the circumstances.” In re Corp. Boundaries
of the Town of Mantachie, 685 So. 2d 724, 726 (Miss. 1996) (quoting In re Extension of the
Boundaries of the City of Columbus, 644 So. 2d 1168, 1172 (Miss. 1994)). “Totality of the
circumstances” is not a thirteenth factor to be addressed by a chancellor in determining whether a
municipality’s annexation is reasonable. We have held that “[t]hese [12]factors, however, are only indicia
of reasonableness, not separate and distinct tests in and of themselves.” Id. at 81-82 (quoting Bassett
v. Town of Taylorsville, 542 So. 2d 918, 921 (Miss. 1989)).
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¶11. A chancellor has the authority to reduce the amount of territory sought to be annexed. Miss. Code
Ann. § 21-1-33. In reviewing the chancellor’s decision to grant, deny, or reduce the proposed annexation,
this Court’s standard of review is well established:
This Court's standard of review for annexation is very limited. The Court can only reverse
the chancery court's findings as to the reasonableness of an annexation if the chancellor's
decision is manifestly wrong and is not supported by substantial and credible evidence. In
re Enlargement and Extension of Mun. Boundaries of City of Madison v. City
of Madison, 650 So. 2d 490, 494 (Miss.1995). We also stated "[w]here there is
conflicting, credible evidence, we defer to the findings below." Bassett v. Town of
Taylorsville, 542 So. 2d 918, 921 (Miss.1989). "Findings of fact made in the context of
conflicting, credible evidence may not be disturbed unless this Court can say that from all
the evidence that such findings are manifestly wrong, given the weight of the evidence." Id.
at 921. "We only reverse where the Chancery Court has employed erroneous legal
standards or where we are left with a firm and definite conviction that a mistake has been
made." Id.
City of Hattiesburg, 840 So.2d at 81 (¶ 18).
II. Prior Jurisdiction
¶12. D’Iberville asserts that although the three petitions were consolidated for trial, its petition was filed
first and thus the D’Iberville filing was entitled to priority consideration by the chancellor. D’Iberville relies
on a treatise which states:
The rule that among separate equivalent proceedings relating to the same subject matter,
that one which is prior in time is prior in jurisdiction to the exclusion of those subsequently
instituted, applies, generally speaking, to and among proceedings for the municipal
incorporation, annexation, or consolidation of a particular territory. In proceedings of this
character, while the one first commenced is pending, jurisdiction to consider and determine
others concerning the same territory is excluded. Thus, where two or more bodies or
tribunals have concurrent jurisdiction over a subject matter, the one first acquiring
jurisdiction may proceed, and subsequent purported assumptions of jurisdiction in the
premises are a nullity. This principle of the common law is based upon the general public
policy of the promotion of the orderly administration of government and justice. Thus, the
first of two or more annexation proceedings prevails over those subsequently commenced
relating to the same territory.
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The prior jurisdiction rule applies where the proceedings are equivalent. If they are not
equivalent, the prior jurisdiction rules does not apply. Thus, the “first step” rule may not
be followed as between conflicting petitions, one which is voluntary, the other involuntary.
...
The jurisdictional priority based on priority in time ordinarily is determined by the time of
the commencement or initiation of the proceedings, and not by the time of completion, nor
by another time or date. However, in some instances a time other than the time the
proceedings are commenced is said to be determinative of jurisdictional priority. The
taking of the first mandatory public procedural step in the statutory process for
incorporation or annexation of territory ordinarily fixes the date of the commencement of
the proceedings, for the purposes of the rule as to jurisdictional priority.
Eugene McQuillin, The Law of Municipal Corporations § 7.22.20, at 508-09 (3d ed. 1996) (footnotes
omitted). D’Iberville also relies on this Court’s decision in Incorporation of Forest Hill v. Fields,
280 So. 2d 837, 838 (Miss. 1973). In Forest Hill, we found:
The doctrine of 'prior jurisdiction' also supports the decree appealed. Where two
inconsistent petitions involving the same territory are pending, it is proper to decline to
consider the later one until there is a disposition of the earlier one. It is held that where a
petition for incorporation of territory into a new municipality was filed and pending before
the institution of annexation proceedings involving the same territory, such annexation
proceedings may not be taken until disposition of the proceedings seeking incorporation.
Id. at 838 (citing City of Daytona Beach v. City of Port Orange, 165 So. 2d 768, 771 (Fla. Dist. Ct.
App. 1964). We were also asked to address prior jurisdiction in Matter of City of Horn Lake, 630
So. 2d 10 (Miss. 1993). However, in that case we found:
Southaven also argues that this state consistently follows the "prior jurisdiction" rule on
questions of municipal boundaries. They contend that if the chancellor had followed the
principles of prior jurisdiction, then he would not have consolidated the trials again on the
passage of Horn Lake's new ordinance. They cite Incorporation of [Forest] Hill v.
Fields, 280 So. 2d 837 (Miss.1973), for support.
In Fields, residents of an area called "[Forest] Hill" fought the City of Jackson over the
incorporation of a twelve mile area abutting the western boundary of Jackson. The trial
court consolidated the annexation proceeding with an incorporation proceeding. During
trial, the City of Jackson adopted an ordinance for extension of the boundary of Jackson
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to the Madison County line. Fields, 280 So.2d at 838. This ordinance did not refer to the
previous ordinance concerning extension into the " [Forest] Hill" area. The annexation
proceeding by [Forest] Hill had previously been dismissed; thus, the later ordinance did
not have an affect on the validity or invalidity of the previous argument.
The ordinance in this case was amended to correctly describe the boundary of the City of
Horn Lake, and its purpose was not to extend the boundaries of Horn Lake into other
territories which were not described in the original annexation ordinance of December 7,
1989. Fields is factually distinguishable from the dispute in this case.
630 So.2d at 16. There was no need to address prior jurisdiction in that case. After Horn Lake’s
annexation was found to be unreasonable, Southaven was permitted to annex the disputed territory.
¶13. Biloxi contends that D’Iberville’s argument is flawed for three reasons. First, Biloxi contends that
the argument fails because D’Iberville has failed to show that it would have been granted the entire PAA
had D’Iberville’s petition been considered first. Second, Biloxi argues that the argument is waived because
D’Iberville failed to raise the issue before the trial court. Finally, Biloxi claims that because D’Iberville
consented to the consolidation order, that D’Iberville is estopped from making that assertion now. Biloxi
is correct that D’Iberville is procedurally barred from raising this issue on appeal because the issue was not
raised before the trial court. Notwithstanding this procedural bar, because this issue is being raised in
annexation litigation around this State, we take this opportunity to address this issue as a guide to the bench
and bar.
¶14. Biloxi is correct in asserting that there has been no showing that the result would have been different
if the D’Iberville petition had been first considered alone. The chancellor analyzed each indicium in great
detail in the twenty-six page Findings of Fact and Conclusions of Law. Furthermore, the consideration of
the testimony of the inclusion petitioners and the testimony of Biloxi’s witnesses was relevant to the
reasonableness of D’Iberville’s petition. As the chancellor stated on page 23 of the Findings of Fact and
Conclusions of Law: “There is no real guidance as to factors to be taken into account when two cities
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compete for the same land.” However, these competing interests in the land should be considered in the
twelve indicia and under the totality of the circumstances.
¶15. As to the question of whether the issue is waived by failure to raise it at the trial court level,
D’Iberville maintains that this is an issue of jurisdiction which may be raised for the first time on appeal.
D’Iberville relies on Norwood v. Extension of Boundaries of City of Itta Bena, 788 So. 2d 747,
751-52 (Miss. 2001). However, that case is distinguishable from the case sub judice. In Norwood, after
finding that the city failed to meet the statutory requirements of the notice provision under Miss. Code Ann.
§ 21-1-15, we held that the concerned citizens could raise the question of jurisdiction for the first time on
appeal. Norwood, 788 So.2d at 751-52. Here, the trial court clearly had jurisdiction over each of the
three petitions, and all statutory notice provisions were met. Further, D’Iberville cites no authority that the
issue of prior jurisdiction may be raised for the first time on appeal.
¶16. Finally, as to the estoppel argument, D’Iberville consented to the consolidation of the three cases
for trial. Not only did D’Iberville consent to the consolidation, but the order of consolidation was prepared
and submitted by one or more of D’Iberville’s attorneys. D’Iberville further acknowledges that the trial
court had the authority to consolidate the three underlying cases for purposes of judicial economy.
¶17. In addition to the arguments brought forth in the briefs, the parties agreed during oral argument that
the doctrine of prior jurisdiction has become antiquated. We agree. When reviewing a petition for
annexation, a chancellor weighs the twelve indicia. The competing interest of another city is considered
under one or more of the indicia and, certainly, when looking at the totality of the circumstances.
¶18. Although this issue is procedurally barred, we address this issue today as a guidance to the bench
and bar. Until this case, we have not been faced with a situation where a chancellor has found more than
one annexation petition concerning the same plot of land to be reasonable. Under the present day
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circumstances where there is competition among multiple municipalities for the same land, it is essential that
a chancellor evaluate the competing interests of the other city or cities when considering the twelve indicia
in the totality of the circumstances. Given this Court’s concerns regarding judicial economy, it is certainly
reasonable for a chancellor to consolidate competing petitions for one trial. This is particularly so given the
considerable expense and time involved in each annexation case. Accordingly, we today declare as
antiquated the prior jurisdiction doctrine as it relates to annexation litigation, and to the extent that any of
our prior cases have recognized and applied this doctrine, these prior cases are to that limited extent
overruled.
III. The Reasonableness of the Chancellor’s Decision
¶19. Because the chancellor correctly consolidated the underlying petitions for annexation of the same
territory, we shall simultaneously address both D’Iberville’s and Biloxi’s interests in the area. Initially, the
chancellor determined that annexation of a portion of the PAA was not reasonable for either D’Iberville
or Biloxi. As to the remainder, the chancellor awarded a portion to D’Iberville and a portion to Biloxi.
The petition for inclusion to Biloxi was granted and that area is included in the award to Biloxi. As stated
above, the following twelve indicia of reasonableness are not separate or independent tests but rather are
helpful in viewing the totality of the circumstances. City of Hattiesburg, 840 So.2d at 82-83 (¶ 21).
¶20. Both cities have appealed the chancellor’s decision that it is not reasonable for either city to annex
a certain portion of the PAA. The area denied to both cities is described as: “All that part of Sections 19,
30 and 31, T6S, R9W, lying East of the Biloxi corporate limits, and Sections 20, 21, 29, 32, and the North
one-half of Section 28, T6S, R9W.” Specifically, the chancellor found:
that (1) neither Biloxi nor D’Iberville has a need to expand into this area; (2) the area
cannot reasonably be found to be a path of growth of either City at this time; (3) there are
not [sic] potential health hazards from sewage and waste disposals in this area which need
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to be addressed by either City at this time; (4) that, although Biloxi has the financial ability
to make the infrastructure improvements and furnish municipal services promised in this
area, Biloxi has substantial undeveloped areas from the previous annexation that need to
be addressed before Biloxi can reasonably undertake the necessary improvements in this
area; (5) D’Iberville does not have the financial ability to make infrastructure improvements
and furnish municipal services to the larger area within a reasonable period of time; (6)
there is no need for zoning and overall planning in the area at the present time, and the
zoning and overall planning provided by Harrison County adequately serves the needs of
this area at the present time and within the reasonably foreseeable future; (7) there is no
need for municipal type services in the areas in its present state of development, or in the
near future; (8) the net effect of allowing the annexation of this largely undeveloped rural
area at this time to either City, would be to block the potential paths of growth for the
other City; and (9) the best interests of the landowners and residents of this area, and of
the two competing cities, would be to allow the further establishment of growth patterns
in the area prior to a determination of whether this area should be annexed to either City,
and which City, if either, is allowed to annex the area herein excluded.
¶21. The chancellor further found it reasonable for the following area to be included in Biloxi: “All that
part of Section 6, T7S, R9W, lying East of the Biloxi corporate limits and North of the Tchoutacabouffa
River and all that part of Section 5, T7S, R9W, lying North and West of the Tchoutacabouffa River; and
all that part of Section 4, T7S, R9W, lying West of the Tchoutacabouffa River” (referred to as the “BAA”).
It also found it reasonable for the following area to be annexed by D’Iberville: “All that part of Section 7,
T7S, R9W, lying North and East of the Biloxi corporate limits; and all that part of Section 6, T7S, R9W,
lying South of the Tchoutacabouffa River; and all that part of Section 5, T7S, R9W, north of D’Iberville
corporate limits and east of the Tchoutacabouffa River; and Section 33, and the S ½ of Section 28, in T6S,
R9W” (referred to as the “DAA”).
A. The municipalities' need for expansion
¶22. The chancellor utilized a number of factors to determine whether either municipality had a need
to expand into the PAA.
This Court has enumerated many factors to consider when determining whether a City
seeking an extension and enlargement has a reasonable need for expansion. These factors
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may or may not include: (1) spillover development into the proposed annexation area; (2)
the City's internal growth; (3) the City's population growth; (4) the City's need for
development land; (5) the need for planning in the annexation area; (6) increased traffic
counts; (7) the need to maintain and expand the City's tax base; (8) limitations due to
geography and surrounding cities; (9) remaining vacant land within the municipality; (10)
environmental influences; (11) the city's need to exercise control over the proposed
annexation area; and (12) increased new building permit activity. In re Enlargement
and Extension of Mun. Boundaries of City of Biloxi, 744 So.2d at 279; Matter
of Enlargement and Extension of the Mun. Boundaries of the City of
Jackson, 691 So. 2d 978, 980 (Miss.1997); Extension of Boundaries of City of
Ridgeland v. City of Ridgeland, 651 So. 2d 548, 552 (Miss.1995); Matter of
Extension of Boundaries of City of Columbus, 644 So. 2d 1168, 1173
(Miss.1994).
In re Enlargement & Extension of Boundaries of City of Macon, 854 So. 2d 1029, 1035 (¶ 12)
(Miss. 2003) (City of Macon). As stated, this list is not exhaustive nor is it required that each factor be
present in order for an annexation to be reasonable. The chancellor’s decision utilized many of the above-
enumerated factors, and the decision is well supported by the evidence as presented at trial.
¶23. D’Iberville has demonstrated its need for expansion in various ways. The existing City is
approximately 4.7 square miles. Development has spilled over into the DAA, including established
subdivision development and ongoing new development. The total area of vacant land represents 19.5%
of the total area of the city. The number of housing units has increased by 627 between 1990 and 2000.
D’Iberville’s population has increased to 1,619 persons per square mile. D’Iberville has been able to
extend sewer service into the DAA, at great cost to the city. Because D’Iberville receives no direct income
from the gaming industry, additional land is necessary to accommodate residential and commercial growth.
However, the chancellor determined that this need is satisfied by the area of the DAA and not the entire
PAA.
¶24. Biloxi also has shown a need to enlarge its borders. The chancellor found that Biloxi’s ability to
expand is limited due to its location. The Mississippi Sound is directly south, the City of Gulfport is directly
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west, D’Iberville directly east, and DeSoto National Forest to its north. Biloxi has grown extensively since
gaming emerged in 1993, as has the entire Harrison County. Biloxi has experienced commercial growth,
including several national chain restaurants and two casinos (bringing the total casinos to nine). In nine
months during 2000, Biloxi issued 333 building permits. From 1996 to 2000, business licenses issued
increased from 140 to 2,570; water connections increased by 3,700, and sewer connections increased by
805. Biloxi has issued 117 building permits, 90 electrical permits, 58 plumbing permits, 28 mechanical
permits and 18 certificates of occupancy in the previously annexed areas. The chancellor found that the
BAA was sufficient to meet the needs of Biloxi and that there was no demonstrated need to expand beyond
that area.
¶25. The chancellor’s decision is well supported by the evidence and testimony presented at trial. This
indicium supports a finding of reasonableness for annexation by each city, as reduced in area by the
chancellor.
B. Whether the area sought to be annexed is reasonably within a path
of growth of either city
¶26. The trial court found that the DAA is clearly a path of growth for D’Iberville and that Biloxi is
growing toward the BAA. The trial court further found that it would be premature to award the remainder
of the PAA to either city at this time because it is largely undeveloped. In evaluating a path of growth in
annexation cases, we have said:
This Court has established factors for consideration when evaluating reasonableness as it
relates to the path of growth which may or may not include: (1) spillover development in
annexation area; (2) annexation area immediately adjacent to City; (3) limited are [sic]
available for expansion; (4) interconnection by transportation corridors; (5) increased
urban development in annexation area; (6) geography; and (7) subdivision development.
In re Extension and Enlargement of the Mun. Boundaries of the City of
Biloxi, 744 So.2d at 280; Enlargement and Extension of Mun. Boundaries of
City of Madison v. City of Madison, 650 So. 2d 490, 497 (Miss.1995); Extension
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of Boundaries of City of Ridgeland, 651 So.2d at 556. This Court in Enlargement
and Extension of Mun. Boundaries of City of Meridian v. City of Meridian,
662 So. 2d 597, 612-13 (Miss.1995), held that the most important factors when
determining the reasonableness of path of growth are the adjacency of the proposed
annexation area to the City, accessibility of the proposed annexation area by City streets,
and spillover of urban development into the proposed annexation area.
City of Macon, 854 So.2d at 1037 (¶ 25). Again, this is not an exclusive list of necessary factors, but
rather is provided as a guide to evaluating the question of whether the area sought to be annexed is
reasonably within a path of growth for a city.
¶27. Both D’Iberville and Biloxi are limited in the direction in which they may expand. D’Iberville is
blocked by Biloxi to the west and the Mississippi Sound to the south. Jackson County lies to the east
where an incorporation petition is pending for a new city. Biloxi is blocked to the east by D’Iberville, to
the west by Gulfport, to the south by the Gulf of Mexico, and, with the exception of a small cushion of land,
to the north by DeSoto National Forest.
¶28. The chancellor found that the DAA, the area to the north and west of D’Iberville, is clearly in the
paths of growth for D’Iberville. Development is already occurring, and there is spillover into the DAA with
the development of new subdivisions and businesses. The new subdivision development has been expedited
due to the water and/or sewer service provided by D’Iberville. Transportation corridors provide direct
access the DAA to D’Iberville, while there are no existing in use streets providing direct access to Biloxi.
¶29. The chancellor also found that Biloxi is growing toward the BAA. These residents have access to
I-10 and several connecting streets into Biloxi. There is considerable development along Highway 15 near
both cities’ corporate limits. Due, for the most part, to the growth in gaming in Biloxi, the population of the
entire PAA has increased by 55% over the last ten years.
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¶30. Again, the chancellor found that the DAA was sufficient to meet the needs of D’Iberville, that the
BAA was sufficient to meet the needs of Biloxi, and that neither city has demonstrated a need to expand
beyond those areas. The chancellor’s decision is based upon personal observation as well as supported
by the evidence presented at trial. This indicium supports a finding of reasonableness for annexation by
each city, as reduced in area by the chancellor.
C. The potential health hazards from sewage and waste disposal in the
annexed area
¶31. Noting that Harrison County and the objectors disagreed with the cities’ position that there are
potential health hazards that need to be addressed, the chancellor found that annexation of the DAA and
BAA will address these problems. Although the chancellor cited no law in this section of the Findings of
Fact and Conclusions of Law, this Court has:
established a number of factors to be considered when evaluating the reasonableness as
related to potential health hazards which may or may not include: (1) potential health
hazards from sewage and waste disposal; (2) a large number of septic tanks in the area;
(3) soil conditions which are not conducive to on-site septic systems; (4) open dumping
of garbage; and (5) standing water and sewage. In re Extension and Enlargement
of the Mun. Boundaries of the City of Biloxi, 744 So.2d at 280; In re Extension
of Corporate Boundaries of the Town of Mantachie, 685 So. 2d 724, 727
(Miss.1996); Extension of the Boundaries of City of Ridgeland, 651 So.2d at
558; City of Horn Lake, 630 So.2d at 18; In re Matter of the Extension of the
Boundaries of the City of Jackson, 551 So.2d at 866; City of Greenville, 513 So.2d
at 935.
City of Macon, 854 So.2d at 1038 (¶ 33). As with the previous two indicia, the list of factors is merely
a guide and is not an exhaustive or exclusive list for determination of whether there are potential health
hazards within a proposed annexation area.
¶32. Jim Weston of the Mississippi Department of Health confirmed that potential health hazards exist
in the PAA. Despite the fact the soils are largely unsuitable for septic tank use, much of the area is served
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by septic tanks. The only sewer service provided in the PAA is that provided by D’Iberville. Biloxi
provides none. Both cities have adequate plans to address the need for proper sewage disposal.
¶33. While the problems were well documented in the DAA and BAA, these potential hazards were
not significant in the reduced area. That area is mostly rural and does not present the potential health
hazards as the more populated areas of the DAA and BAA. Thus, after the reduction of the rural areas,
the chancellor’s findings that this indicium favors annexation is supported by the evidence presented at trial.
The question would then be which municipality could provide these services.
D. The municipalities' financial ability to make the improvements and
furnish municipal services promised
¶34. The chancellor found that both cities have the financial ability to successfully complete the proposed
annexation, as reduced. In so determining:
This Court has developed several factors to evaluate reasonableness as related to financial
ability which may or may not include: (1) present financial condition of the municipality; (2)
sales tax revenue history; (3) recent equipment purchases; (4) the financial plan and
department reports proposed for implementing and fiscally carrying out the annexation; (5)
fund balances; (6) the City's bonding capacity; and (7) expected amount of revenue to be
received from taxes in the annexed area. Town of Mantachie, 685 So.2d at 728; City
of Meridian, 662 So.2d at 611; Extension of Boundaries of City of Ridgeland,
651 So.2d at 558; City of Columbus, 644 So.2d at 1171; City of Greenville v.
Farmers, Inc., 513 So.2d at 935; In re Extension of Boundaries of City of
Ridgeland, 388 So. 2d 152, 156 (Miss.1980); In re Extension and Enlargement
of the Mun. Boundaries of the City of Biloxi, 361 So.2d at 1374; Bridges v. City
of Biloxi, 253 Miss. 812, 178 So. 2d 683, 685 (1965); In re City of Gulfport, 253
Miss. 738, 179 So. 2d 3, 6 (1965).
City of Macon, 854 So.2d at 1039-40 (¶ 40). As with the other indicia, this list is not exclusive or
exhaustive but rather is provided as guidance in determining the financial ability of the municipality to
provide the improvements and services promised.
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¶35. Both cities are in good financial condition and have the ability to keep their commitments,
particularly with the reduction in the area annexed. D’Iberville’s sales tax revenue has increased from
$1,253,234 in 1996 to $2,389,868 in 2000. D’Iberville has very little outstanding bonded debt subject
to the 15% limitation and had a general obligation capacity of $7,660,326 for the fiscal year of 2002.
¶36. Both D’Iberville and Harrison County stipulated that Biloxi’s proposed annexation was reasonable
from a financial ability standpoint. Biloxi has a bonding capacity of approximately $40 million and a total
budget of approximately $100 million. Biloxi's general fund has approximately $18 million cash on hand,
and Biloxi has approximately $62 million unencumbered cash overall. Biloxi has a fund balance of $6 to
$7 million in water and sewer plans; is undertaking capital projects costing approximately $60 million; and
has reduced its general fund millage to 15 mills.
¶37. Thus, the chancellor’s finding that annexation of the DAA by D’Iberville and the annexation of the
BAA by Biloxi is reasonable from a financial standpoint for both cities.
E. The need for zoning and overall planning in the area
¶38. The chancellor found that this indicium does not have any significant impact on either annexation.
Biloxi argues that this indicium should favor Biloxi over D’Iberville because Biloxi’s planning department
is better staffed and funded. This argument fails to take into account that the area is already covered under
Harrison County’s zoning ordinance for the entire PAA. Therefore, we find reasonable the chancellor’s
decision that this indicium is neutral relative to both cities’ proposed annexation.
F. The need for municipal services in the area sought to be annexed
¶39. The chancellor found that there is a need for the establishment of municipal services that favor a
finding of reasonableness of annexation by both cities, but not for the entire PAA. Some factors to consider
under this indicium include:
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(1) requests for water and sewage services; (2) plan of the City to provide first response
fire protection; (3) adequacy of existing fire protection; (4) plan of the City to provide
police protection; (5) plan of City to provide increased solid waste collection; (6) use of
septic tanks in the proposed annexation area; and (7) population density. Enlargement
and Extension of the Mun. Boundaries of City of Madison, 650 So. 2d 490, 502
(Miss.1995); Extension of Boundaries of City of Ridgeland, 651 So.2d at 559;
City of Horn Lake, 630 So. 2d 10, 21 (Miss.1993).
This Court has also addressed how these factors are applied when addressing sparsely
populated areas and densely populated areas. This Court found that in sparsely populated
areas, there is less of a need for immediate municipal services. In re Matter of the
Extension of the Boundaries of the City of Jackson, 551 So.2d at 867.
City of Macon, 854 So.2d at 1041-42 (¶¶ 51-52). Again, not all of the above-listed factors need be
present or satisfied for an annexation to be deemed reasonable.
¶40. While there has been substantial population growth in the PAA, the majority of that growth has
been immediately adjacent to the city limits of D’Iberville and Biloxi. The area reduced from the PAA
consists largely of undeveloped area; and therefore, the trends do not apply to the reduced area. From
1990 to 2000, the entire PAA has grown in dwelling units from 328 to 533 and in population density from
88 persons per square mile to 136 persons per square mile.
¶41. Most of the PAA has been assigned a fire rating of Class 10 (the worst possible rating) by the
Mississippi Rating Bureau while D’Iberville is rated Class 7 and Biloxi is rated Class 5. Upon annexation,
the rating of each area will be changed to that of the city to which it belongs. Thus, annexation will result
in a decrease of fire insurance rates for residents in the respective annexation areas.
¶42. The D’Iberville Fire Department has made numerous runs into the PAA. D’Iberville provides
police protection at a municipal level through an interlocal agreement with the Harrison County Sheriff
Department; however, D’Iberville is in the process of establishing its own police department. Biloxi already
has its own police department. Although the chancellor found that the level of service currently provided
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by the Harrison County Sheriff’s Department in the PAA is adequate, additional municipal level law
enforcement will benefit the area as it develops further. Sewer utilities are needed in certain areas of the
BAA. Biloxi is capable of delivering water and sewer to the BAA. D’Iberville already provides water and
sewer to certain portions of the PAA, particularly residences and businesses within the DAA.
¶43. Biloxi provides numerous recreational and cultural opportunities for the area. Biloxi has the area’s
only natatorium, conducts various festivals and maintains numerous parks and museums. Recreational
opportunities for D’Iberville are currently being provided by interlocal agreement with Harrison County.
¶44. There is no dispute between the parties that there is a need for municipal services in the PAA now
and in the future. This indicium favors a finding that annexation is reasonable. Again, the question becomes
which city could provide these services. That Biloxi is bigger and has a larger budget does not mean that
the services D’Iberville could provide are insufficient. Based upon the evidence presented at trial, the
chancellor’s weighing of the competing interests, and personal observation of the area, the chancellor’s
findings are reasonable and supported by the evidence.
G. Whether there are natural barriers between either city and the
proposed annexation area
¶45. The chancellor found that “[t]he existence of barriers, man-made, natural or geopolitical does not
indicate the unreasonableness of the proposed annexation by either City.” This Court has previously
considered natural or man-made conditions that may impede a city’s expansion or render the provision of
services impossible or prohibitively expensive, including flood plains, Columbus, 644 So.2d at 1174-75,
Extension of Boundaries of Horn Lake v. Renfro, 365 So. 2d 623, 625 (Miss. 1978); interstate
highway, Southaven, 630 So.2d at 23, City of Hattiesburg, 588 So. 2d 814 (Miss. 1991); and county
lines, City of Hattiesburg, 588 So. 2d 814, Jackson, 551 So.2d at 865-66.
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¶46. In today’s case, the only natural barrier in either the DAA or BAA is the Tchoutacabouffa River.
However, since the river has already been bridged for traffic purposes, the river is not a factor. Thus, the
chancellor’s finding that this indicium is neutral is reasonable and supported by the evidence.
H. The past performance and time element involved in either cities'
provision of services to its present residents
¶47. This indicium is difficult to assess in the instant case. D’Iberville has no past annexation to evaluate,
and Biloxi’s past performance is difficult to measure due to the recent date of the 1999 annexation. With
that difficulty in mind, the chancellor found that both cities have performed sufficiently in the past to satisfy
this indicium.
¶48. Although D’Iberville has never before annexed territory, the city was incorporated in 1988. The
services provided to D’Iberville’s current residents provide proof of its abilities. Water and sewer is
available to all residences and businesses, although five residential structures are not connected to sewer
and 24 residential structures are not connected to water. Either directly or through interlocal agreements,
D’Iberville provides at a municipal level fire protection, police protection, trash and garbage collection,
street lighting, parks and recreational facilities, streets, drainage, right-of-way maintenance, and animal
control. D’Iberville has a comprehensive plan and zoning ordinance and has adopted standard building and
construction codes.
¶49. The services that Biloxi has undertaken to provide through its previous annexation are currently
on schedule. Water and sewer is being provided in the previously annexed areas on an “as needed” basis.
Biloxi owns the French Utilities, Cedar Lake Utilities, and Smith Utilities. The expected purchase of the
certificated areas of the Galion Utilities will better serve the Woolmarket area. Biloxi is also seeking to
build a fire station with land for a recreational facility in the Woolmarket area. They have also entered into
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an agreement with the Harrison County School District for the use of a gym for recreational activities in
other recently annexed areas of the city.
¶50. The Biloxi Public Works Department has met or exceeded its $1,159,000 projected annexation
area cost for the first year and is expected to do the same for the second year. The Community
Development Department is updating its mapping, zoning, and land development ordinance and has
committed $300,000 to do so. The Comprehensive Plan is being updated. ¶51. Thus, the evidence
supports the chancellor’s finding that this indicium favors a finding of reasonableness for each city's
annexation, as reduced.
I. The impact (economic or otherwise) of the annexation upon those who
live in or own property in the area proposed for annexation
¶52. The chancellor found that this indicium evaluating the impact of an annexation on the residents and
property owners supported the reasonableness of these annexations, as reduced. Under this indicium, the
chancellor must "balance the equities by comparing the City's need to expand and any benefits accruing to
residents from the annexation with any adverse impact, economic or otherwise, which will probably be
experienced by those who live in and own property in the annexation area." In re City of Horn Lake,
630 So. 2d 10, 23-24 (Miss. 1993) (citing In re Ext. of Boundaries of City of Jackson, 551 So. 2d
861, 867-68 (Miss. 1989)). “The mere fact that residents and landowners will have to start paying city
property taxes is not sufficient to show unreasonableness.” Columbus, 644 So.2d at 1179 (citing
Jackson, 551 So.2d at 867-68).
¶53. In the chancellor’s view, the residents and property owners of the DAA and BAA will receive
valuable services in return for the additional taxes. These services include police protection, fire protection,
public works, and improved street and drainage maintenance, paving of streets, street lighting,
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administration of municipal level code enforcement, and municipal level planning and zoning. Also, water
and sewer needs will be extended where necessary and economically feasible. The comparative financial
impact is relatively low in that D’Iberville’s tax levy is 28.63 mills and Biloxi’s tax levy is 30.10 mills.
Additionally, the testimony of the Wells Ferry Landing residents (the inclusion petitioners) favored
annexation of this area into Biloxi. Thus, the evidence supports the chancellor’s finding that this indicium
favors annexation by each city, as reduced.
J. The impact of the annexation upon the voting strength of protected
minority groups
¶54. The parties agreed at trial that there would be no impact on the voting strength of protected
minorities. Thus, the chancellor correctly found that this indicium is neutral.
K. Whether the property owners and other inhabitants of the areas
sought to be annexed have in the past, and in the foreseeable future
unless annexed will, because of their reasonable proximity to the
corporate limits of the municipality, enjoy the (economic and social)
benefits of proximity to the municipality without paying their fair
share of taxes
¶55. The chancellor found that this indicium was neutral. While residents of the PAA do receive some
benefit by their proximity to the respective cities, it is “no more or less than any other citizen might receive
as a result of living in close proximity to a City.” The chancellor further reasoned that this factor is balanced
by the fact that these outside residents shop at businesses inside the city, thereby increasing the sales tax
rebate. Thus, we find reasonable the chancellor’s finding that this factor is neutral.
L. Any other factors that may suggest reasonableness, vel non
¶56. In this indicium, the chancellor noted that there has been little or no guidance provided to a trial
court when there is more than one city competing for the same land. In this particular situation, all parties
agreed to consolidate the matter for trial. Both cities have shown the need to expand in the sought area,
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that the reduced areas are paths of growth for each, and that both cities have a common interest in
establishing certain indicia, such as need for municipal services, planning and zoning, and the existence of
potential health hazards. No natural barriers or impact on minority voting strength prohibit either city from
annexation. Annexation would not have a substantial impact on the unincorporated residents, who currently
benefit from the close proximity of both cities. Both cities have the financial ability to successfully complete
the improvements of the annexation, as reduced.
¶57. However, to permit annexation of the entire area by either municipality would effectively block any
future annexation efforts of the other. Because the remaining area is undeveloped, the chancellor’s decision
to deny annexation of this area to both cities is well supported by the evidence and is reasonable. The
chancellor’s decision to grant the inclusion petition is reasonable for the reasons described above favoring
annexation of the BAA by Biloxi.
CONCLUSION
¶58. Today we declare as antiquated the prior jurisdiction doctrine as it relates to municipal annexation
litigation in Mississippi, and to the extent that any of our prior cases have recognized and applied this
doctrine, these prior cases are to that limited extent overruled. Certainly our learned chancellors, for the
sake of judicial economy and in fairness to annexation litigants, can consolidate multiple annexation cases
involving common tracts of disputed territory.
¶59. Based upon the foregoing, this Court affirms the chancellor’s judgment granting in part and denying
in part the annexation petitions of both D’Iberville and Biloxi and granting the inclusion petition of the Wells
Ferry Landing citizens.
¶60. AFFIRMED ON DIRECT APPEAL AND ON CROSS-APPEAL.
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SMITH AND WALLER, P.JJ., COBB, GRAVES AND DICKINSON, JJ., CONCUR.
EASLEY, J., CONCURS IN RESULT ONLY. PITTMAN, C.J., AND DIAZ, J., NOT
PARTICIPATING.
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