This bill removes cities' ability to annex unincorporated islands without residents' consent effective January 1, 2013. This provision was enacted in 1992 to encourage cities to incorporate unincorporated islands that existed prior to the prohibition of their creation. The bill failed twice in the Senate.

HB 124 clarifies that annexation arbitration panel members are entitled to a per diem of $115 plus reimbursement for mileage.

This bill adds another requirement to the 100% method of annexation. Cities would be required to prepare a plan for extending services and improvements to the area proposed for annexation. If the city fails to provide these services after two years, then the property owners could deannex the property. The county's consent for the deannexation would be required.

This bill was amended in committee to create a new method of annexation that allows any newly created municipality to annex "unincorporated peninsulas" for a period of five years. Cities are permitted to annex "unincorporated peninsulas" defined as being less than 15 square miles in area and more than 75 percent surrounded by city territory, counties other than where the city is located, or both. Although the annexation must be approved by the voters of the area proposed to be annexed, this new method of annexation does not require any sort of plan or report on how the city will extend services to the area proposed to be annexed. Additionally, this new method does not require any notice to the county nor does it allow the county to object even if there are land use, service delivery or infrastructure conflicts.