Citing cost of services, Bellingham rejects Northern Heights annexation request

BELLINGHAM – In a split vote last week, the Bellingham City Council rejected a neighborhood’s request to annex the area where they live just outside the city limits.

Residents of a mostly developed area of 146 acres on the northeast outskirts of Bellingham, known as Northern Heights, filed paperwork in early 2024 seeking to be included in the city. Property owners representing at least 60% of the assessed value of the area asked to be included in the city.

After a year of study, however, a 5-1-1 majority of City Council members feared that the cost of providing police and fire services would add to a looming budget deficit amid economic uncertainty for 2026. They also worried about costs associated with culverts in the area that must be replaced under a U.S. Supreme Court ruling that requires easier passage underneath roads for streams that carry migrating salmon.

Voting to reject the application at their Aug. 25 meeting were councilmembers Lisa Anderson, Dan Hammill, Hollie Huthman, Hannah Stone and Skip Williams. Councilman Michael Lilliquist voted against rejecting the annexation request and councilmember Jace Cotton abstained.

Their biggest stumbling block was the uncertainty of costs regarding the culvert replacement, Anderson said.

“When you have a hole, you don’t bring an excavator to dig the hole bigger,” she said.

Lilliquist acknowledged his colleagues’ financial concerns, but said he hoped that the council would delay the annexation application rather than outright reject it.

“It’ll grow our tax base, it’ll grow our revenues, but it will also grow our obligations for services. I understand the legitimacy of that concern. But this is a poster child for what growth management is supposed to look like, where we do orderly annexations along our boundaries,” Lilliquist said.

He pointed out that most residents of the area get their water and sewer service from the city, and that its roads are built to city standards.

“This is the sort of property that we’re supposed to be able to annex, and the fact that we can’t I think is a problem that doesn’t really relate to the annexation itself,” Lilliquist said.

The problem that Lilliquist referenced is a deficit of possibly $10 million for fiscal year 2026 that Mayor Kim Lund’s administration announced in committee hearings earlier Aug. 25.

That information weighed heavily on councilmember Dan Hammill’s vote against annexation.

“I do agree, that this – it is a poster child for what we could be bringing into the city if it were 2005. And it’s not. It’s 2025, we have a severe shortage right now. I jut can’t support this at this point,” Hammill said.

Included in the annexation area is Fire Station 12 and its fire training center, which is part of Fire District 4 but is staffed and operated under contract with North Whatcom Fire and Rescue. North Whatcom and Bellingham Fire handle some of each other’s calls as part of an “automatic aid” agreement that sends the closest available firefighters to any emergency, Bellingham Fire Chief Bill Hewett told the council.

Law enforcement services are provided by the Whatcom County Sheriff’s Office, whose deputies respond to 911 calls in the area that average fewer than one per day, according to data provided as part of the annexation request.

There are about 300 “dwelling units” and about 700 people living in the area.

In 2025 the area provided $338,663.31 in revenues, including property taxes. Annual staffing and maintenance expenses amount to $426,941.64. In addition, the city would lose $140,000 annually in non-resident surcharges for water service. That amounts to an annual shortfall of $228,278.33.

The current estimated cost of the culvert replacement work was about $12.5 million, said Chris Behee, the city’s long-range planning manager. That work might not be required for 10 years or more, and could be eligible for grant funding, so its cost to the city is uncertain, Behee said in an Aug. 25 presentation.

Between 200 and 300 dwelling units could be built in the area, Behee said.