Hierarchically overlaid cellular networks provide advantages of different cell sizes: micro- (or pico-) cells can provide a higher data rate and capacity while macrocells serve faster moving mobile units, as required in the 3-G cellular networks. Terminals with different velocities are assigned to higher (or larger) cell or lower (or smaller) cells, depending on their speeds with respect to the velocity threshold, V(0). In two-tier cellular networks with microcells and overlaid macrocell, mobile units need to be appropriately assigned to a lower (micro) or upper (macro) cellular network. In this paper, a new velocity threshold decision algorithm for cell selection or, in general, handoff control in a hierarchically structured network is introduced and validated with comparison to currently known methods. Velocity threshold, V(0), is determined to maximize system performance in terms of call blocking rate and handoff dropping rate and used as a decision threshold.