Buying Land Near Celina, Texas: ETJ and Annexation Explained

Drive north on Preston Road past downtown Celina and you cross an invisible line every mile or so. No fence marks it. No sign announces it. But on one side, a landowner needs Celina's blessing to plat a subdivision, build a road to city standard, or form a district to finance a sewer line, as Celina's subdivision ordinance and the Texas Water Code provide. On the other side, none of that applies. The same acre of North Texas dirt answers to two entirely different rulebooks depending on which side of that line it sits, and which side it sits on has changed for dozens of properties in just the past few years.

That line is a city's extraterritorial jurisdiction, or ETJ, and a 2023 state law rewrote who controls it. For anyone evaluating raw land, acreage, or a development site near Celina right now, understanding that law matters more than knowing the median home price ever will.

The Leverage Cities Used to Hold

Before 2023, a city's ETJ functioned like a waiting room. Land inside it wasn't part of the city yet, but the city held real influence over what happened there. Developers who wanted to finance water, sewer, and drainage infrastructure through a Municipal Utility District needed the city's consent to create that district, because MUD formation inside a city's ETJ requires it. That single requirement gave cities like Celina a seat at the table on nearly every large land deal at their edges. Cities used that seat to negotiate development agreements, secure future annexation rights, and hold projects to city design and infrastructure standards even before the land was formally inside city limits.

What Senate Bill 2038 Changed

Senate Bill 2038, passed by the Texas Legislature in 2023, gave individual landowners a new tool: the right to petition to remove their own property from a city's ETJ. The bill's committee analysis confirms the mechanism is close to automatic. If a city doesn't act on a petition, release happens by operation of law, generally within about 45 days. There's no requirement that the city agree, and no meaningful way for a city to block it outside of a narrow set of exceptions, such as land within five miles of a military base with an active training mission.

That flips the leverage described above. A landowner no longer has to negotiate with a city to escape its planning authority. They can simply file the paperwork and land under the county's lighter set of rules instead, which typically govern drainage, plats, and roads but stop well short of a city's land use and design standards.

Celina's mayor, Ryan Tubbs, put it plainly in comments reported by Yahoo News. Special districts like MUDs were originally meant to help bond infrastructure for communities that weren't ready to build it themselves. Since SB 2038, he said, that tool has "kind of just gone above and beyond that with the powers that they contain inside of the state." He also confirmed the scale of the shift already underway in Celina: roughly 50 properties have petitioned out of the city's ETJ since the law took effect, ranging from single-acre homesteads to 50-acre tracts.

Fifty parcels sounds small against a city projected to grow toward a population of 378,000 at build-out, a figure Celina's own long-range planning documents cite. But each of those parcels is a piece of the map the city can no longer shape through platting review, subdivision ordinance, or annexation leverage, unless the owner later consents to come back in.

Two Paths, Same Road

The contrast is easiest to see next to Ramble, Hillwood Communities' 1,380-acre master-planned community two miles north of downtown Celina. Hillwood took the cooperative path. In October 2024, Celina's city council unanimously approved a development agreement expanding the project by 34 acres, and the company worked with the city through a formal annexation and infrastructure framework rather than around it. The result, as of its ribbon cutting this past May, is a community built to Celina's standards from the ground up: roughly 600 homesites delivered in phase one, a planned 4,000 homes across six phases running into the 2040s, an eventual value near $4.3 billion, and a trail network designed to tie into more than 86 miles of existing Celina trails. Mayor Tubbs described Ramble as sitting alongside the historic downtown square as an asset the city can point to and claim.

A landowner who instead petitions a smaller tract out of the ETJ gets speed and fewer restrictions, but none of that coordination. No guaranteed tie-in to city trail systems. No obligation to meet Celina's subdivision standards. No city-negotiated infrastructure partnership. Just county-level rules and whatever the owner chooses to build.

Here's how that plays out across the decisions a buyer or investor actually has to make:

In 2025, MUDs in Collin County generally carried tax rates between $0.80 and $1.20 per $100 of assessed value. By comparison, straight city tax rates in the region run closer to $0.43 per $100 in cities like Frisco and Plano. The buyer also inherits whatever patchwork of private wells, septic systems, or ad hoc service agreements the county framework allows.

Celina's own annexation page is candid about the tradeoff from the city's side too. Without an agreement in place, the city argues, "city taxpayers subsidize fire, police, and infrastructure for properties in the ETJ," while development outside city standards "can negatively impact the surrounding property values." That's the city's read. A buyer's read should be narrower and more practical: know which rulebook applies to the specific parcel in front of you before you model the deal.

What This Means for a Land Purchase Near Celina Right Now

For anyone underwriting a land deal, an acreage purchase, or a value-add site near Celina, the ETJ question deserves the same weight as the price per acre.

Pull the parcel on the county appraisal district site and check every taxing entity listed. Ask whether the property sits inside Celina's ETJ, inside city limits, or has already been released under SB 2038. If it's still in the ETJ, ask whether the city has a deferral agreement on file, since Celina has signed roughly 600 of them with property owners who chose to delay annexation while keeping their current land use. If it's been released, understand that reversing that status later is not something the city can do for you.

None of this makes one path better than the other in every case. A released parcel might be exactly right for a buyer who wants fewer regulatory layers and lower long-term tax exposure. A parcel inside a cooperative development agreement might be right for someone who wants city-grade infrastructure and a role in a larger master-planned vision like Ramble. The mistake is not knowing which one you're buying until the tax bill or the plat rejection tells you.

A Few Questions Worth Settling Before You Buy

Does petitioning out of the ETJ eliminate property taxes? No. What changes is the city's authority over land use, platting, and infrastructure standards, not the underlying tax base.

Can land that left a city's ETJ be brought back in? Yes, but only with the property owner's consent. There is no automatic path back once a parcel has been released.

Are there any exceptions to the opt-out right? Yes. Property within five miles of a military installation with an active training program is generally excluded from the SB 2038 petition process.

Land near a fast-growing city like Celina rewards buyers who understand the rules underneath the dirt, not just the price on top of it. If you're evaluating acreage, a development site, or a value-add opportunity in this corridor, Brian Abadie works these deals from the ground up, matching renovation and land experience with a clear read on how the regulatory line actually falls on a given parcel. Work With Brian before you write an offer, not after.

This article is general information, not legal, tax or financial advice. Consult a qualified professional about your situation.