AUSTIN (Austin Business Journal) — As disagreements between cities and landowners over a new state law wage on, one Texas city is taking its complaints to court, and an Austin-area municipality is joining the fight.

This marks the latest pushback of Senate Bill 2038, which was passed earlier this year by the Texas Legislature and went into effect on Sept. 1 after Gov. Greg Abbott signed it into law. The law essentially allows landowners on the fringes of major cities to petition to be removed from an extraterritorial jurisdiction, freeing them up to develop with fewer regulations.

Many in the business community have said SB 2038 makes development easier in rapidly growing areas near big cities and helps to keep up with housing demand, although most agree deannexation should be a last resort. Opponents said the law is too friendly to developers and limits cities’ power to effectively regulate land they might one day annex. Court and lawyer fees are starting to pile up as more landowners take advantage of the law – and disagreements continue to arise.

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