Multiple Lake Austin properties dis-annexing from City of Austin

AUSTIN, Texas - More than 150 properties along Lake Austin disannexed from the City of Austin this month. 

This comes after decades of conflict over taxation and lack of some city services. 

The backstory:

This started back in 1891, when the city wanted to build a bridge across the Colorado River. Back then, cities couldn't just annex property, so they asked the state legislature to give it some land along what would become Lake Austin. The first two dams they built broke because of flooding. 

In 1940, Tom Miller Dam was built, which raised the lake level.

Chris Johns, lead partner for property disputes at Cobb & Johns, represents the current owners of about 300 Lake Austin properties. 

"Those narrow strips of land were covered up by the new lake level, and so the new shoreline was completely outside the city of Austin," he said. 

In the 1960s, the Council decided not to annex those new parts. However, in 1985, the city put shoreline properties on tax rolls.

"The following year, the City Council looked at it again, looked at the history, realized, 'oh, we can't really do this.' These people, their properties were not properly within the city of Austin," Johns said.

They passed an ordinance that made them a limited purpose jurisdiction of the City of Austin, which means the properties don't receive full services but aren't taxed either. 

In 2019, City Council passed an ordinance that said the properties would be taxed. 

"They just declared that our people were within the taxable jurisdiction, even though that isn't the truth," Johns said.

Landowners protested with the Travis Central Appraisal District and filed a federal lawsuit against the city in 2021. Both lawsuits are still ongoing. 

"Our folks really got the worst of both worlds where they did not get services, and yet they pay full taxes," Johns said.

He estimates they've paid the city $20–$40 million in taxes since 2020.

"Our folks are just looking at what they do next. The fair thing would be to give the taxes back, because they never should have been paid," he said.

During the 2025 legislative session, a state law passed that allows property owners to disannex if they aren't fully receiving city services.

Numerous property owners used that to petition the city to disannex.

"It isn't a case where these folks just wanted to get all the services but didn't want to pay the taxes. It was just the opposite. They would have loved the services and would have been willing to pay taxes," Johns said.

Johns says which city services the properties get varies. Some get none, and some get a portion of services. Some contract with LCRA to pull water out of the lake.

Dig deeper:

City documents show the following service changes with disannexation for the properties represented by Johns. It reads: 

"The disannexed area refers to 143 discontinuous properties located adjacent to or near Lake Austin in the area generally bounded by FM 2222 to the north, Loop 1 to the east, Bee Cave Rd to the south, and FM 620 to the west. City of Austin services that may be impacted on the effective date of disannexation:

• 1. Police Protection. Law enforcement services will be provided by the Travis County Sheriff’s Office (TCSO).
• 2. Solid Waste Collection. Austin Resource Recovery will no longer provide solid waste collection, including trash, recycling, composting, brush, and bulk.
• 3. Watershed Protection. Austin Watershed Protection will no longer provide drainage planning, drainage inspection, maintenance, and water quality enforcement services in the disannexed area.
• 4. Planning. Austin Planning will no longer provide zoning or comprehensive planning in the disannexed area.
• 5. Code Compliance. The Austin Development Services Code Compliance team will only provide education, enforcement, and abatement services relating to sign regulations and development work without a permit where applicable.
• 6. Clean Community Services. Austin Resource Recovery will no longer provide clean community services, such as street sweeping, dead animal collection, and litter management, in the disannexed area.
• 7. Capital Improvements Planning. The disannexed area will no longer be included with other territory in connection with planning for new or expanded facilities, functions, and services.

City of Austin services that may continue to be provided in the area, which will be located in the extraterritorial jurisdiction (ETJ), after the effective date of disannexation: 

• 1. Fire Protection. Austin Fire may no longer operate as the primary jurisdictional fire emergency response services provider. Austin Fire, through the "Automatic Aid Agreement Between Emergency Services Districts of Travis and Williamson Counties and the Cities of Austin, Leander, Cedar Park, Round Rock, and Georgetown" may continue fire emergency response.
• 2. Emergency Medical Service. City of Austin/Travis County Emergency Medical Services will provide emergency medical services.
• 3. Electric Utility Service. Austin Energy will continue to provide electric utility service to the disannexed area.
• 4. Austin Animal Services. Austin Animal Services will continue to provide services in the disannexed area.
• 5. Public Health, Social, and Environmental Services. The Austin/Travis County Health and Human Services Department will continue to provide services.
• 6. Library. Residents in the disannexed area, which is in the ETJ, may utilize all Austin Public Library facilities.
• 7. Operation and Maintenance of Roads and Streets, Including Street Lighting. Austin Transportation and Public Works may continue to maintain public streets, regulate signage services, and perform street lighting maintenance. The City may continue to offer any residential parking programs, and maintain Dynamic Speed Display Devices, if such services are currently maintained by the City.
• 8. Watershed Protection. Austin Watershed has the authority to regulate floodplains and protect environmentally sensitive areas such as watersheds that are within the City’s ETJ. Floodplain and environmental regulations are enforced through the Land Development Code regulations.
• 9. Development Review. Austin Development Services will provide limited development review and inspection services in accordance with and as limited by applicable codes, laws, ordinances and special agreements. There are some City of Austin development regulations that may apply in the disannexed area."

On Dec. 11, City Council voted to approve the first batch of disannexations — more than 150 properties. They were items 88, 89, and 90.

All council members voted in favor without any discussion. 

What's next:

"The big thing is for our folks, they've already won in a big way, because the city won't be able to continue taxing them. It's not just about taxation either. It's about the full level of regulation that the city has," Johns said.

The next batch of properties that have petitioned to be disannexed will come before City Council in the coming months. 

7 On Your SideLake AustinAustin City Council