The Vancouver City Council is weighing annexation options. They range from annexing a small patch of land north of Padden Parkway to adding the entire urban growth area — including Hazel Dell, Felida, Salmon Creek, Mount Vista, Five Corners and Orchards — to city limits. Councilors seemed interested in exploring a comprehensive, long-term approach rather than small annexations. “I think going big or going home is the best scenario,” Vancouver City Councilor Ty Stober said. In 1990, Washington adopted the Growth Management Act, which requires cities and counties to plan for increasing populations. Part of that planning includes the designation of urban growth areas — regions around cities where the city can expand by bringing pieces under its control over time. Until then, urban growth areas are controlled by counties. An expensive feat Vancouver’s urban growth area encompasses 56 square miles and is home to about 171,000 residents. If Vancouver were to absorb those residents, it would almost double in size and become the second largest city in Washington behind Seattle.

Although the state does not require a city to absorb all of its urban growth area, it’s strongly encouraged. Vancouver annexing all of its urban growth area would be an expensive feat. The Growth Management Act is an unfunded mandate, meaning cities receive no financial help to carry out the act’s demands. The four annexation scenarios at Vancouver City Council workshop on Monday offered high price tags and little return. All but one of the presented scenarios would result in deficits of $42 million to $50 million because the cost of services including police, fire and streets would outweigh the tax revenue the city would receive from the annexed area. Annexing all of the urban growth area would result in an ongoing $49 million deficit, the city estimates.

The one scenario that wouldn’t result in a deficit, according to city staff, is annexing an area from state Highway 500 north to Padden Parkway along Northeast 117th Avenue. The area east of Interstate 205 is home to 1,700 residents and has commercial corridors that would result in an ongoing $1 million surplus. This would be the most viable option for the city, said Natasha Ramras, the city’s chief financial officer. But councilors seemed to wince at the idea. “I would hate to make a profit off of annexation,” Mayor Anne McEnerny-Ogle said. “That doesn’t feel appropriate.” If the city only plucked profitable areas, the county would lose sources of revenue. “I look at these scenarios, and I see bankruptcy,” Stober said. “I see municipal bankruptcy happening either on the city side or on the county side.”

Councilor Erik Paulsen said annexing from Highway 500 to Padden Parkway could send the Legislature a message that it has created a financial disincentive for expansion. “Sometimes being a bad actor in that respect is what it takes to get the legislative reform necessary to fully fund this unfunded mandate,” Paulsen said. Acting quicker Still, councilors wanted to kick-start a conversation about how the city could annex areas quicker. Since the city created its urban growth area, much of it has become housing developments — turning from fields into communities of taxpayers. The city could miss out on more growth by waiting to annex these areas.

“It’s very evident to me that over the long term, it’s in our best interest to be as aggressive as we can conceivably be in acquisition strategy, so that we have a higher quality of life and a better financial viability going forward to the city,” Paulsen said. Delaying annexation could mean higher infrastructure and service costs. (Urban growth areas often need investment to become a denser urban environment, such as road improvements.) Councilors said they worry about how the city would be able to pay for such improvements. “I live in one of those (annexed) areas, and we still don’t have a sidewalk,” Councilor Diana Perez said.

However, some councilors suspected growth would provide for some costs eventually, even if a deficit would occur initially. The council directed city staff to refine the financial estimates for the full urban growth area annexation scenario to include estimated revenue from growth. A full annexation wouldn’t need to be done all at once, councilors said. “I can see us doing this in phases,” Councilor Kim Harless said.