The town of White City has failed in its attempt to annex land from its neighbour, the Rural Municipality (RM) of Edenwold.
The Saskatchewan Municipal Board (SMB) issued a decision on Thursday, following a hearing in November.
White City was hoping to annex nearly 4,000 acres of land from the RM, including the community of Emerald Park, and add it to the town.
"We are very disappointed in the decision by the SMB in this matter," White City Mayor Brian Fergusson said in a news release.
The formal effort to annex the land by White City began in 2018.
The RM has argued annexation would lead to a reduction in services due to its tax base shrinking.
The town saidRM residents use facilities in White City but do not pay for them. The town also argued annexation would reduce expenses for the RM.
"We respect the board's decision but ultimately feel this is setting a dangerous precedent for urban municipalities across the province of Saskatchewan. Our team put together a strong fact-based application which unfortunately did not provide a strong enough case in the opinion of the Municipal Boundary Committee," Fergusson said.
In its response, the town said its borders are 55 per cent surrounded by the RMs development and argued that will grow to 85 per cent in the future.
White City made an application for the annexation in 2019. The RM challenged it, ultimately leading to the hearing of the SMB committee last fall.
"Emerald Park residents and the entire RM can be assured that we will continue providing quality services with the lower tax rates our ratepayers have come to enjoy," said RM of Edenwold Reeve Mitchell Huber in a news release.
"With this legal dispute now over, we would sincerely like to offer White City success with its ongoing plans for future development, including developing a town centre.
"With co-operation, both municipalities can prosper and be good partners to all the communities in the region."
White City manager says decision will lead to RM's 'choking out' urban neighbours
On Thursday, White City manager Rodney Audette said the decision sets a precedent "that rural municipalities can grow unchecked on the borders of urban municipalities."
"This unchecked growth will allow RMs to dictate how, where, and frankly, if urban municipalities are allowed to grow at all. It sends a dangerous message that taking a tactic of surrounding and choking out your urban neighbours is an acceptable practice."
The RM has said its opposition to the annexation was not the process but the land the town wanted to gain.
"It has businesses, it has houses and has everything, so it's very unusual," Sameh Nashed, the RM of Edenwold's chief operating officer told CBC last year.
Board says annexation was for 'financial reasons'
In its decision, the municipal board committee wrote, "we have concluded that annexation of the developed lands is sought only for financial reasons rather than to enable future growth of the Town. The Town has not demonstrated a need to annex land to stop the development next to its borders."
The board said in its ruling that White City had an "adequate supply of undeveloped residential land" that would last up to 12 years.
It said the town did not demonstrate a need to annex already developed lands for growth.
"There may be efficiencies of scale, but the evidence on this point was scant and certainly not sufficient to order an annexation of this magnitude."