The Law in North Carolina
The law is fairly straightforward and you can read exactly what it says here.
Bascially, subject to certain restrictions, any municipality of any size may exercise ETJ for up to one mile beyond its limits. A municipality of 10,000 to 25,000 people may exercise ETJ for up to two miles beyond its limits if it obtains the approval of the county commissioners. A municipality of over 25,000 people may exercise ETJ for up to three miles beyond its limits if it obtains the approval of the county commissioners.
There is one major restriction: unless it obtains the approval of the county commissioners, a municipality may not exercise ETJ in an area in which the county has adopted and is enforcing (a) a zoning ordinance, (b) subdivision regulations, and (c) the State Building Code. The statute specifically says that the municipality may exercise ETJ unless the county is exercising all three of these powers.
If a municipality wants to exercise ETJ, then it must notify potentially affected land owners, hold hearings, and adopt an ordinance. Further, affected landowners must have proportional representation on the town's planning board.
b. Legal Challenge: The most common argument against ETJ is that it allows a municipality to control zoning and exercise other municipal powers over land owners who cannot vote for the officials that are making the decisions. This argument was rejected by the United States Supreme Court thirty years ago. Holt Civic Club v. City of Tuscaloosa, 439 U.S. 60, 70-75 (1978). It has also been rejected by the North Carolina Supreme Court. State v. Rice, 158 N.C. 635, 74 S.E. 582 (1912)("There is nothing in our Constitution which restricts the Legislature in the exercise of its police power from conferring upon the municipal authorities of Greensboro such [extraterritorial] power.” The North Carolina Supreme Court reached the same conclusion in 1957 for an extraterritorial zoning ordinance adopted by Raleigh pursuant to a specific grant of authority in local legislation. City of Raleigh v. Morand, 247 N.C. 363, 100 S.E.2d 870 (1957).
c. ETJ is the Rule, Not the Exception: According to Professor Owens' survey in 2005, seventy-one percent of NC municipalities of 1,000 to 2,500 people exercise ETJ. Sixty-nine percent of NC municipalities of 2,500 to 10,000 people exercise ETJ. And eighty-five percent of NC municipalities of over 10,000 people exercise ETJ. Why not Lewisville, Clemmons, and others like them in Forsyth County?
The Socioeconomic Impact of ETJ in North Carolina
Urban Sprawl, we have all heard of the term. Many of us have seen and felt the negative consequences of sprawl. But few of us know what creates this problem, and why Urban Sprawl is so universally assailed by competent Community Planners across the country. So how does ETJ fit into this situation? You can read the full paper here.