Landowners and developers anxious to withdraw from a municipality’s extraterritorial jurisdiction (ETJ) are filing petitions with municipalities across Texas in the wake of the enactment of Senate Bill 2038, which became effective Sept. 1, 2023, and was codified as Subchapter D of Chapter 42 of the Texas Local Government Code. Cities and towns may welcome the retreat in some cases, but disputes are brewing along gateway tracts and key boundaries where landowners and developers may face a fight.

ETJ is defined in Section 42.021 of the Texas Local Government Code as “the unincorporated area that is contiguous to the corporate boundaries of a municipality.” The size of a municipality’s ETJ is based on the population of the municipality. For example, the ETJ of a municipality with a population of 100,000 or more covers the area within five miles of that municipality’s boundaries. Section 42.001 of the Texas Local Government Code explains that the purpose of an ETJ is to “promote and protect the general health, safety, and welfare of persons residing in and adjacent to the municipalities.” Areas within a municipality’s ETJ may be subject to annexation and limited regulation by the municipality.