The mayor of Regina says the relationship between his city and the surrounding rural municipality has improved.

On Monday, during a conference for community planners, Mayor Michael Fougere noted that differences with the RM of Sherwood, over development, may be a thing of the past.

The two sides had presented substantially different plans for development earlier in the year.

"We had, you know, differences of opinion," Fougere said. "With us and Sherwood, many things are better now between us. But we want to be able to rise above that issue and say well there's got to be a way that we can all prosper from what's happening around us."

The RM's deputy reeve Tim Probe, agreed that his community and the city are working together.

Annexation deal reached

According to materials filed by the City of Regina for an upcoming meeting of council, the two sides have also come to an agreement on an annexation plan where Regina would take over some land and provide compensation to the RM.

The agreement, which still needs to be approved by council, would see Regina expand in three areas, including a large expanse of land southeast of the city. Notably, however, the annexation excludes a proposed development called Wascana Village.

Regina's boundary would also extend south of the airport and north of Dewdney Avenue.

The RM will hang on to what is currently farm land north of the city.

Until the agreement, Regina will pay the RM compensation. That will equal the 2013 taxes payable, on the lands annexed, times 15.

Regina will also assume debt owed by the RM to a company on South Tower Road.

Regina city council meets Wednesday to consider the deal.