AUBURN — The Auburn City Council Tuesday took the first official step to annex an area northeast of the city on Morningstar Road and the Bridgewater North development.

The council unanimously approved the first reading of a fiscal plan for the annexation, Mayor Norm Yoder said Wednesday.

According to the plan, the annexation area contains about 262 acres. The current city acreage is 4,905 acres. After annexation, the area will make up 5% of the city’s total of 5,167 acres, the plan states.

The area’s current population is estimated to be 71 people in a total of 30 homes. However, with the 78 undeveloped residential lots within the Bridgewater subdivision, there is a potential future population of 257 people, according to the plan.

There are 50 buildings within the annexation area, including 38 single-family homes, 15 garages, four sheds and one commercial building, which is part of the Bridgewater Golf Club.

Zoning of the area is low-density single-family residential and parks and recreation. It was established through the city’s extraterritorial jurisdiction and will not change as a result of the annexation, the plan states.

The Bridgewater North residential subdivision, which is included in the proposed annexation, currently is under development. The subdivision has 89 lots, 11 of which have been built or are under construction, the plan states. Homes that are being built in the subdivision range in value from $250,000 to $350,000. The developer of the subdivision signed an annexation non-remonstrance agreement in order to connect to city water and sewer utilities, the plan states. The agreement applies to each lot within Bridgewater North. The annexation also includes several residential lots on Morningstar Road.

A summary of projected revenue and expenditures shows an estimated $80,622 in revenue in 2022 with estimated expenses of $224,612. The summary shows revenue is projected to be $313,548 by 2028, with expenses estimated at $168,123.

The council will vote on a second reading of the plan at its Sept. 3 meeting, when it also will introduce the annexation ordinance, Yoder said.

A public hearing on the annexation ordinance will take place Nov. 11 with the second reading of the ordinance scheduled to take place Dec. 17. If approved, the annexation will take effect June 30, 2020, Yoder said.

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