NC H524

Increases municipal population threshold for involuntary annexation procedure from 5,000 to 10,000 persons and requires municipalities to provide at least two meaningful services (police, fire, solid waste, street maintenance, water, or sewer) within existing boundaries before annexing.

Requires voluntary annexation in distressed areas (51% of households at or below 200% of federal poverty threshold) upon petition of 75% of property owners or 75% of resident households, and prohibits use of streets or street rights-of-way to establish contiguity for annexation.

Mandates water and sewer line extension within three years of annexation to all annexed properties, establishes five-year financial projections for annexation reports, and allows assessment and tap fee payments to be spread over 20 years and 5 years respectively.

Creates referendum process requiring 15% of registered voters in municipality and proposed annexation area to trigger voter approval before involuntary annexation; establishes Local Government Commission oversight including fiscal feasibility assessment, service provision reporting, and authority to prohibit further annexations or abate property taxes.

Authorizes binding city-county utility service plans for water and sewer services and allows municipalities to contract with property owners for service extension and non-appeal of involuntary annexation; gives priority to annexed distressed areas for community development block grants and loans from water/wastewater reserves.