Editor’s note: The City Council’s voting record has been updated in this article, and Councilwoman Yolanda Avila’s vote has been corrected.

New properties looking to annex into Colorado Springs city boundaries will have to prove there is a surplus of capacity and resources for all four utilities services, not just water.

The City Council on Tuesday voted 6-1, with no discussion, to approve five changes to city code governing annexations and water service requirements that further guide how and when the city will grow. Councilman Mike O’Malley was the sole no vote. Councilwomen Yolanda Avila and Michelle Talarico were absent.

Among the ordinances is a new general requirement that Colorado Springs Utilities must have a surplus in capacity and resources across all of its service lines — electric, natural gas, water and wastewater — “for the foreseeable future,” in order to supply new properties looking to come into city boundaries.

The new provision comes just over a year after the board in January 2023 approved a controversial water rule that requires the city-owned utility to have 128% of the water necessary to serve existing demand and the projected demand from new properties before allowing those new properties to come into the city.

Renee Congdon, the utilities division chief in the City Attorney’s Office, told the board when she first presented the proposed changes at a March 11 work session that both electricity and gas resources had become scarcer as utilities regulations increased.

“We want to make sure that when annexations come in that we’re evaluating all four services — not just water and wastewater,” she told the council last month.

The new utilities provisions for annexations do not explicitly quantify the amount of gas and electricity that must be able to serve existing and projected demand from properties looking to annex into Colorado Springs, while the water rule does.

When the water requirement went into effect early last year, it seemingly blocked a large proposal to annex 3,200 acres southeast of Colorado Springs near Fountain and create a sprawling development of up to 9,500 homes, 2 million square feet of commercial space, schools, public safety facilities, and parks and open space called Amara.

In previous public discussions with City Council about the water rule in the fall of 2022, utilities staff said Amara would not meet the threshold for annexation because of the water requirement. But, after determining estimated citywide water usage had decreased by last June, Utilities officials said at that time it had the capacity to reliably serve its existing customers and the proposed Amara development.

Utilities Chief Planning and Financial Officer Tristan Gearhart told the council during an informational presentation on Amara on March 11 it will cost the enterprise more than $4.6 million a year to serve Amara. Gearhart worried the ballooning cost of serving the utility’s existing customers due to new state regulations could rise from around $400 million a year currently to around $800 million a year.

If the city decided now to annex Amara and there is “no backing for rates to grow where they need to,” Utilities could face a situation where it can’t meet the need in Colorado Springs limits and the annexed area it has no obligation to serve, he previously said.

The Amara annexation proposal could come before the Planning Commission for consideration on April 16.

Most of the changes the council approved Tuesday update language in city code to match existing practices when officials consider annexation requests or agreements to annex property in the future, at the city’s discretion, Congdon previously said. Many of the changes also reorganize the code so it is more logical and flows better.

Read more about the code changes here.

The changes require two votes from the City Council. The board is scheduled to make its second vote at its regular meeting April 23.