3-judge panel hears arguments in Bloomington annexation appeal, ruling expected in a few months
On Tuesday afternoon a three-judge panel from Indiana’s court of appeals heard oral arguments in a case involving the city of Bloomington’s constitutional challenge to a 2019 state law, which causes annexation waivers to expire after 15 years.
[Link to video of Dec. 17, 2024 Court of Appeals Annexation hearing.]
A ruling in favor of Bloomington would now be key to the city’s effort, which started in 2017, to annex five territories that are currently outside city limits.
The 2019 law rendered invalid the waivers of remonstrance rights that many property owners had signed over the years. The 2019 law meant that such property owners were able to sign remonstrance petitions, who otherwise could not have signed.
If the city can convince the court that the 2019 law is unconstitutional, many signatures would not have counted for the remonstrators—enough to drop the total down under the threshold needed to block the city’s annexation effort.
The 3-member panel of judges hearing the case consisted of: Melissa May (appointed by Frank O’Bannon 1998); Elizabeth Tavitas (appointed by Eric Holcomb in 2018); and Mary DeBoer (appointed by Holcomb in September 2024).
A ruling is expected in the next few months.
Tuesday afternoon’s hearing lasted about 45 minutes. All three judges actively questioned the two lawyers arguing the case, as they gave their presentations.
For the city of Bloomington, it was Andrew McNeil with Bose McKinney, who presented the appeal of the lower court ruling, which came earlier this year in June. Special local judge Nathan Nikirk out of Lawrence County rejected Bloomington’s argument that the 2019 law violates Indiana’s state constitution.
Giving the arguments for the state of Indiana it was James Barta, solicitor general. The named defendant in Bloomington’s lawsuit was Cathy Smith, who was county auditor at the time the remonstrance signature counts were done. But because the lawsuit challenged the constitutionality of the 2019 law that Smith followed, when she counted signatures, the state of Indiana intervened in the case.
About 15 seconds into McNeil’s presentation to the court, he was interrupted by Tavitas, who wanted clarity about the nature of the contracts that are at the center of the constitutional question.
Indiana’s state constitution states that no law can be passed by the state legislature, if it impairs the obligation of contracts.
The contracts that are at the center of the lawsuit are remonstrance waivers which were signed by many property owners in exchange for a city sewer connection. The bargain struck by property owners and subsequent owners of the land was that they got the ability to purchase sewer service from city of Bloomington utilities, in exchange for not remonstrating against a future annexation of their property into the city.
With their questions, the three-judge panel drew out the basic chronological background to the case.
After Bloomington’s city council passed its annexation ordinances in fall 2021, by the third week of February 2022, remonstrators in five of the seven areas that Bloomington wanted to annex had gathered enough signatures—from more than 65 percent of landowners—to block Bloomington’s annexation effort.
But the signatures depended crucially on the 2019 law, which affects the status of waivers of the right to remonstrate—which were signed by many property owners in exchange for a city sewer connection. The 2019 law says that such waivers of the right to remonstrate are good only for 15 years. After 15 years, a property owner is free to sign a remonstrance petition.
The city of Bloomington filed its lawsuits based on the idea that the 2019 law violates the contracts clause of Indiana’s state constitution and the U.S. Constitution.
Without the 2019 law, many of the signatures of remonstrators in the five areas would not have counted. In fact, without the 2019 law, none of the five areas would have had valid remonstrance signatures from more than 65 percent of landowners.
At one point during Tuesday’s oral arguments, McNeil held up a page from from the city of Bloomington’s brief, showing a table that illustrates the impact of the 2019 state law. If the law is constitutional, then Bloomington’s annexation effort in all five areas (Area 1C, Area 2, Area 3, Area 4, and Area 5) will have automatically failed.
That’s because more than 65 percent of landowners in those areas signed remonstrance petitions, which was enough to stop the annexation outright. (Left column in table below.)
But if the courts find the 2019 law to be unconstitutional, the annexation in five of the seven areas (Area 1A, Area 1B, Area 1C, Area 2, and Area 3) will have succeeded without any further legal wrangling. (Right column in table above.) That’s because the number of valid remonstrance signatures in those areas would drop to 50 percent or less, if the law is found to be unconstitutional.
In the other two annexation areas, Area 1A and Area 1B, landowners did not hit the 65-percent threshold, but did achieve 50-percent, which meant that a bench trial could be held on Bloomington’s annexation effort in those areas. In that trial, Nikirk ruled against Bloomington, and that ruling is also currently being appealed.
The constitutional argument could have also been relevant in Area 1A and Area 1B, but the city of Bloomington wanted to expedite the bench trial, and opted to dismiss its constitutional claims for those two areas. That’s something that the state of Indiana’s lawyers have seized upon as a “claim preclusion” argument against the city’s position in the appeal involving the five other areas.
The idea is that because Bloomington already waived the same argument in the other two cases, it cannot use the argument in the current case. As May noted during Tuesday’s oral arguments, if the court eventually agrees with the claim preclusion argument, it would not even have to decide the constitutional question.
The basic idea of the state’s position is that the contracts clause of the constitution is about contracts between private parties and does not give local governments a right to object to the validity of statutes that release obligations due the state or themselves.
On Tuesday, DeBoer seemed of the three judges more disinclined to see the state’s overall position in a favorable light. DeBoer brought up the state law passed in 2017, which stopped Bloomington’s annexation effort outright. When the city of Bloomington filed suit, the Indiana Supreme Court found three years later that the 2017 law was unconstitutional “special legislation” targeting just Bloomington.
DeBoer seemed to be asking Barta, the solicitor general, about the general idea that the 2019 law was another attempt by the state legislature to specifically undercut Bloomington’s annexation effort.
DeBoer put it like this:
You guys shut it down—I mean, in effect, that [2017] law stopped them in their tracks with 2017, correct? And then by the time everybody kind of reached the point where we had a conclusion by the Supreme Court saying that it…was not considered a constitutional law… So you have to admit—Does it seem to you like the timing [for the 2019 law] is suspicious? Like we had to hurry up and get this done? Because this particular law could have been enacted 10 years ago, but it wasn’t. It was enacted the minute these guys [Bloomington officials] start going ahead and saying: Hey, we’ve got all these different areas that we want to annex. So what do you think about that?
In responding, Barta relied on the fact that the arguments that Bloomington had made in the current case, did not include any that are based on the same special legislation concept as the successful argument against the 2017 legislation. Barta put it like this: “So your honor, I think it sounds like that the type of argument that is oftentimes made the basis for a special legislation challenge, which hasn’t been brought here.”
Documents
- Brief: Bloomington in support of appeal
- Brief: State of Indiana against appeal
- Brief: Bloomington reply
