1.1                          A bill for an act 
  1.2             relating to the Minnesota municipal board; clarifying 
  1.3             authority and procedures; amending Minnesota Statutes 
  1.4             1994, sections 414.01, subdivisions 1, 2, 6a, 7a, 8, 
  1.5             12, and 16; 414.02, subdivision 3; 414.031, 
  1.6             subdivision 4; 414.0325, subdivisions 1, 1a, and 3; 
  1.7             414.033, subdivision 5, and by adding a subdivision; 
  1.8             414.041, subdivisions 3 and 5; and 414.061, 
  1.9             subdivisions 4 and 5; repealing Minnesota Statutes 
  1.10            1994, sections 414.01, subdivisions 3, 3a, and 4; and 
  1.11            414.061, subdivision 4a. 
  1.12  BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.13     Section 1.  Minnesota Statutes 1994, section 414.01, 
  1.14  subdivision 1, is amended to read: 
  1.15     Subdivision 1.  A board to be known as The Minnesota 
  1.16  municipal board is hereby created to conduct proceedings, make 
  1.17  determinations and issue orders for the creation of a 
  1.18  municipality, the combination of two or more governmental units, 
  1.19  or the alteration of a municipal boundary. 
  1.20     The legislature finds that:  (1) sound urban development 
  1.21  and preservation of agricultural land and open spaces through 
  1.22  land use planning is essential to the continued economic growth 
  1.23  of this state; (2) municipal government most efficiently 
  1.24  provides governmental services in areas intensively developed 
  1.25  for residential, commercial, industrial, and governmental 
  1.26  purposes; and township government most efficiently provides 
  1.27  governmental services in areas used or developed for 
  1.28  agricultural, open space, and rural residential purposes; (3) 
  2.1   the public interest requires that municipalities be formed when 
  2.2   there exists or will likely exist the necessary resources to 
  2.3   provide for their economical and efficient operation; (4) 
  2.4   annexation to existing municipalities of unincorporated areas 
  2.5   unable to supply municipal services should be facilitated; and, 
  2.6   (5) the consolidation of municipalities should be 
  2.7   encouraged.  It is the purpose of this chapter to empower The 
  2.8   Minnesota municipal board is empowered to promote and regulate 
  2.9   development of municipalities to provide for the extension of 
  2.10  municipal government to areas which are developed or are in the 
  2.11  process of being developed for intensive use for residential, 
  2.12  commercial, industrial, institutional, and governmental purposes 
  2.13  or are needed for such purposes; and to protect the stability of 
  2.14  unincorporated areas which are used or developed for 
  2.15  agricultural, open space, and rural residential purposes and are 
  2.16  not presently needed for more intensive uses; and to protect the 
  2.17  integrity of land use planning in municipalities and 
  2.18  unincorporated areas so that the public interest in efficient 
  2.19  local government will be properly recognized and served. 
  2.20     Sec. 2.  Minnesota Statutes 1994, section 414.01, 
  2.21  subdivision 2, is amended to read: 
  2.22     Subd. 2.  The board shall be composed of three members 
  2.23  appointed by the governor, at least one of whom shall be learned 
  2.24  in the law, and at least one of whom shall be a resident from 
  2.25  outside of the metropolitan area as defined in section 473.121, 
  2.26  subdivision 2.  The board shall select from its members a chair 
  2.27  who shall have the powers and duties prescribed by the general 
  2.28  law applicable to the heads of departments and agencies of the 
  2.29  state.  All those appointed must be residents of the state for 
  2.30  at least five years before the appointment.  Each appointed 
  2.31  member shall serve for six years.  The board shall meet once 
  2.32  each month at a regular time to be established by the chair.  
  2.33  The removal of members and filling of vacancies for members 
  2.34  other than county commissioner members on the board are as 
  2.35  provided in section 15.0575.  
  2.36     In proceedings before the board for the incorporation of a 
  3.1   statutory city, consolidation of two or more municipalities, or 
  3.2   annexation of unincorporated land to a municipality, two county 
  3.3   commissioners of the board of the county in which all or a 
  3.4   majority of the affected land is located shall serve on the 
  3.5   board during such time as the board shall have under 
  3.6   consideration said matter.  The executive director of the board 
  3.7   shall upon initiation of a proceeding for such incorporation, 
  3.8   consolidation, or annexation notify the county auditor of the 
  3.9   county in which the majority of the affected property is 
  3.10  situated of the need for the appointment of the two county 
  3.11  commissioners to the board.  At the next succeeding meeting of 
  3.12  the county board the commissioners shall designate the two 
  3.13  appointed and shall thereupon immediately notify the Minnesota 
  3.14  municipal board executive director of their action.  The county 
  3.15  commissioners shall represent districts which do not contain any 
  3.16  of the affected territory.  If commissioners from the unaffected 
  3.17  districts are unavailable, commissioners from the affected 
  3.18  district may serve. 
  3.19     Sec. 3.  Minnesota Statutes 1994, section 414.01, 
  3.20  subdivision 6a, is amended to read: 
  3.21     Subd. 6a.  Each member of the municipal board shall receive 
  3.22  $50 per day when in attendance at board meetings or hearings, or 
  3.23  when otherwise engaged in the performance of duties.  The county 
  3.24  commissioners shall be paid $25 per day for each hearing or 
  3.25  meeting attended.  The county auditors and commissioners shall 
  3.26  be deemed to be performing duties for the county without 
  3.27  additional compensation when serving as ex officio members of 
  3.28  the board.  Each member of the board and the county commission 
  3.29  members of the board shall be reimbursed for actual expenses 
  3.30  incurred in accordance with state travel regulations relative to 
  3.31  travel and expenses of state officers and employees. 
  3.32     Sec. 4.  Minnesota Statutes 1994, section 414.01, 
  3.33  subdivision 7a, is amended to read: 
  3.34     Subd. 7a.  The Minnesota municipal board shall appoint an 
  3.35  executive director, not a member of the board, who shall be 
  3.36  learned in the law qualified as a result of practical, 
  4.1   professional, or educational experience and receive a salary in 
  4.2   an amount fixed by law.  The director shall devote full time to 
  4.3   the duties of office.  All correspondence and petitions shall be 
  4.4   addressed to the executive director who shall be is charged with 
  4.5   conducting the administrative affairs of the board. 
  4.6      Sec. 5.  Minnesota Statutes 1994, section 414.01, 
  4.7   subdivision 8, is amended to read: 
  4.8      Subd. 8.  The board shall have authority to contract with 
  4.9   regional, state, county, or local planning commissions or to 
  4.10  hire expert consultants to provide specialized information and 
  4.11  assistance, and.  Any member of the board conducting or 
  4.12  participating in the conduct of any hearings hearing, or its 
  4.13  executive director, shall have the power to administer oaths and 
  4.14  affirmations, to issue subpoenas, and to compel the attendance 
  4.15  and testimony of witnesses, and the production of papers, books, 
  4.16  and documents. 
  4.17     Sec. 6.  Minnesota Statutes 1994, section 414.01, 
  4.18  subdivision 12, is amended to read: 
  4.19     Subd. 12.  In proceedings pursuant to this chapter, the 
  4.20  executive director or any board member may receive and report 
  4.21  evidence and such person shall have power to administer 
  4.22  oaths and affirmations to witnesses, examine witnesses, and 
  4.23  receive and report evidence.  In any proceeding in which the 
  4.24  evidence is received by one board member or by the executive 
  4.25  director, the board member or executive director shall make a 
  4.26  report of the evidence to the board.  When all members of the 
  4.27  board do not attend a hearing in a proceeding, any party may 
  4.28  request the executive director shall to cause a transcript of 
  4.29  the hearing to be made and distributed to all board members if 
  4.30  requested by a party to the proceeding.  Thereupon, the board 
  4.31  shall proceed to make its decision based on all the evidence 
  4.32  presented.  When the evidence is received by fewer than two 
  4.33  permanent board members, the board's order shall be stayed for a 
  4.34  period of 30 days, during which time any party of record may 
  4.35  demand a rehearing by the full board.  Any party requesting a 
  4.36  copy of the transcript for board members is responsible for its 
  5.1   costs. 
  5.2      Sec. 7.  Minnesota Statutes 1994, section 414.01, 
  5.3   subdivision 16, is amended to read: 
  5.4      Subd. 16.  In a any proceeding before the board, the board 
  5.5   may at any time in the process require that representatives from 
  5.6   the involved city, town, and county, political subdivision, or 
  5.7   other governmental entity to meet together to discuss the 
  5.8   resolution of issues raised at the hearing before the board by 
  5.9   said petition or order which confers jurisdiction on the board 
  5.10  and other issues of mutual concern.  The board may require that 
  5.11  the parties meet at least three times during a 60-day period.  
  5.12  The parties shall designate a person to report to the board on 
  5.13  the results of the meetings immediately after the last meeting. 
  5.14     Sec. 8.  Minnesota Statutes 1994, section 414.02, 
  5.15  subdivision 3, is amended to read: 
  5.16     Subd. 3.  [BOARD'S ORDER.] In arriving at its decision, the 
  5.17  board shall consider the following factors: 
  5.18     (a) Present population and number of households, past 
  5.19  population growth and projected population growth for the 
  5.20  subject area; 
  5.21     (b) Quantity of land, both platted and unplatted, within 
  5.22  the area proposed for incorporation within the subject area; the 
  5.23  natural terrain of the area including recognizable physical 
  5.24  features, general topography, major watersheds, soil conditions 
  5.25  and such natural features as rivers, lakes and major bluffs; 
  5.26     (c) Present pattern of physical development, planning, and 
  5.27  intended land uses in the subject area including residential, 
  5.28  industrial, commercial, agricultural and institutional land uses 
  5.29  and the impact of the proposed action on those uses; 
  5.30     (d) The present transportation network and potential 
  5.31  transportation issues, including proposed highway development; 
  5.32     (d) (e) Land use controls and planning presently being 
  5.33  utilized in the subject area, including comprehensive plans for 
  5.34  development in the area and, policies of the metropolitan 
  5.35  council.  If; and whether there is an inconsistency are 
  5.36  inconsistencies between the proposed development and the land 
  6.1   use planning ordinance in force, the reason for the 
  6.2   inconsistency existing land use controls; 
  6.3      (e) Present (f) Existing levels of governmental services 
  6.4   being provided to the subject area, including water and sewer 
  6.5   service, fire rating and protection, police protection law 
  6.6   enforcement, street improvements and maintenance, administrative 
  6.7   services, and recreational facilities and the impact of the 
  6.8   proposed action on the delivery of the services; 
  6.9      (f) (g) Existing or potential problems of environmental 
  6.10  pollution problems and whether the need for additional services 
  6.11  to proposed action is likely to improve or resolve these 
  6.12  problems; 
  6.13     (g) (h) Fiscal data of impact on the subject area and 
  6.14  adjacent units of local government, including the net tax 
  6.15  capacity of both platted and unplatted lands and the division 
  6.16  between homestead and nonhomestead property, and the present 
  6.17  bonded indebtedness; and the local tax rates of the county, 
  6.18  school district, and township present bonded indebtedness, local 
  6.19  tax rates of the county, school district and other governmental 
  6.20  units; including where applicable, the net tax capacity of 
  6.21  platted and unplatted lands and the division of homestead and 
  6.22  nonhomestead property; and other tax and governmental aid 
  6.23  issues; 
  6.24     (h) (i) Relationship and effect of the proposed 
  6.25  incorporation action on communities adjacent to the area and on 
  6.26  affected and adjacent school districts within and adjacent to 
  6.27  the area communities; 
  6.28     (i) Adequacy of town government to deliver services to the 
  6.29  area (j) Whether delivery of services to the subject area can be 
  6.30  adequately and economically delivered by the existing 
  6.31  government; and 
  6.32     (j) (k) Analysis of whether necessary governmental services 
  6.33  can best be provided through incorporation or annexation to an 
  6.34  adjacent municipality. the proposed action or another type of 
  6.35  boundary adjustment; 
  6.36     (1) Degree of contiguity of the boundaries of the subject 
  7.1   area and adjacent units of local government; and 
  7.2      (m) Analysis of the applicability of the state building 
  7.3   code. 
  7.4      Based upon these factors, the board may order the 
  7.5   incorporation if it finds that (a) the property to be 
  7.6   incorporated is now, or is about to become, urban or suburban in 
  7.7   character, or (b) that the existing township form of government 
  7.8   is not adequate to protect the public health, safety, and 
  7.9   welfare, or (c) the proposed incorporation would be in the best 
  7.10  interests of the area under consideration.  The board may deny 
  7.11  the incorporation if the area, or a part thereof, would be 
  7.12  better served by annexation to an adjacent municipality. 
  7.13     The board may alter the boundaries of the proposed 
  7.14  incorporation by increasing or decreasing the area to be 
  7.15  incorporated so as to include only that property which is now, 
  7.16  or is about to become, urban or suburban in character, or may 
  7.17  exclude property that may be better served by another unit of 
  7.18  government.  The board may also alter the boundaries of the 
  7.19  proposed incorporation so as to follow visible, clearly 
  7.20  recognizable physical features for municipal boundaries.  In all 
  7.21  cases, the board shall set forth the factors which are the basis 
  7.22  for the decision. 
  7.23     Notwithstanding any other provision of law to the contrary 
  7.24  relating to the number of wards which may be established, the 
  7.25  board may provide for election of council members by wards, not 
  7.26  less than three nor more than seven in number, whose limits are 
  7.27  prescribed in the board order upon a finding that area 
  7.28  representation is required to accord proper representation in 
  7.29  the proposed incorporated area because of uneven population 
  7.30  density in different parts thereof or the existence of 
  7.31  agricultural lands therein which are in the path of suburban 
  7.32  development, but after four years from the effective date of an 
  7.33  incorporation the council of the municipality may by resolution 
  7.34  adopted by a four-fifths vote abolish the ward system and 
  7.35  provide for the election of all council members at large as in 
  7.36  other municipalities. 
  8.1      The board's order for incorporation shall provide for the 
  8.2   election of municipal officers in accordance with section 
  8.3   414.09.  The plan of government shall be "Optional Plan A", 
  8.4   provided that an alternate plan may be adopted pursuant to 
  8.5   section 412.551, at any time.  The ordinances of the township in 
  8.6   which the new municipality is located shall continue in effect 
  8.7   until repealed by the governing body of the new municipality. 
  8.8      Sec. 9.  Minnesota Statutes 1994, section 414.031, 
  8.9   subdivision 4, is amended to read: 
  8.10     Subd. 4.  [BOARD'S ORDER.] In arriving at its decision, the 
  8.11  board shall consider the following factors: 
  8.12     (a) Present population and number of households, past 
  8.13  population growth and projected population growth of the 
  8.14  property proposed for annexation and the annexing 
  8.15  municipality subject area and adjacent units of local 
  8.16  government; 
  8.17     (b) Quantity of land within the property proposed for 
  8.18  annexation and the annexing municipality subject area and 
  8.19  adjacent units of local government; and natural terrain 
  8.20  including recognizable physical features, general topography, 
  8.21  major watersheds, soil conditions and such natural features as 
  8.22  rivers, lakes and major bluffs; 
  8.23     (c) Degree of contiguity of the boundaries between the 
  8.24  annexing municipality and the property proposed for annexation 
  8.25  subject area; 
  8.26     (d) Present pattern of physical development of, planning, 
  8.27  and intended land uses in the property proposed for annexation 
  8.28  subject area and the annexing municipality including 
  8.29  residential, industrial, commercial, agricultural and 
  8.30  institutional land uses and the impact of the proposed action on 
  8.31  those land uses; 
  8.32     (e) The present transportation network and potential 
  8.33  transportation issues, including proposed highway development; 
  8.34     (e) (f) Land use controls and planning presently being 
  8.35  utilized in the annexing municipality and the property proposed 
  8.36  for annexation subject area, including comprehensive plans for 
  9.1   development in the area and plans and policies of the 
  9.2   metropolitan council.  If, and whether there is an inconsistency 
  9.3   are inconsistencies between the proposed development and the 
  9.4   existing land use planning ordinance in force, the reason for 
  9.5   the inconsistency controls and the reasons therefore; 
  9.6      (f) Present (g) Existing levels of governmental services 
  9.7   being provided in the annexing municipality and the property 
  9.8   proposed for annexation subject area, including water and sewer 
  9.9   service, fire rating and protection, police protection law 
  9.10  enforcement, street improvements and maintenance, administrative 
  9.11  services, and recreational facilities and the impact of the 
  9.12  proposed action on the delivery of said services; 
  9.13     (g) (h) Existing or potential problems of environmental 
  9.14  pollution problems and whether the need for additional services 
  9.15  to proposed action is likely to improve or resolve these 
  9.16  problems; 
  9.17     (h) (i) Plans and programs by the annexing municipality for 
  9.18  providing needed governmental services to the property proposed 
  9.19  for annexation subject area; 
  9.20     (i) Fiscal data of (j) An analysis of the fiscal impact on 
  9.21  the annexing municipality and the property proposed for 
  9.22  annexation subject area, and adjacent units of local government, 
  9.23  including net tax capacity and the present bonded indebtedness, 
  9.24  and the local tax rates of the county, school district, and 
  9.25  township; 
  9.26     (j) (k) Relationship and effect of the proposed annexation 
  9.27  action on communities affected and adjacent to the area and on 
  9.28  school districts within and adjacent to the area and 
  9.29  communities; 
  9.30     (k) (l) Adequacy of town government to deliver services to 
  9.31  the property proposed for annexation subject area; 
  9.32     (l) (m) Analysis of whether necessary governmental services 
  9.33  can best be provided through incorporation or annexation to an 
  9.34  adjacent municipality the proposed action or another type of 
  9.35  boundary adjustment; and 
  9.36     (m) (n) If only a part of a township is annexed, the 
 10.1   ability of the remainder of the township to continue or the 
 10.2   feasibility of it being incorporated separately or being annexed 
 10.3   to another municipality. 
 10.4      Based upon these the factors, the board may order the 
 10.5   annexation (a) if it finds that the property proposed for 
 10.6   annexation subject area is now, or is about to become, urban or 
 10.7   suburban in character, or (b) if it finds that municipal 
 10.8   government in the area proposed for annexation is required to 
 10.9   protect the public health, safety, and welfare, or (c) if it 
 10.10  finds that the annexation would be in the best interest of 
 10.11  the property proposed for annexation subject area.  If only a 
 10.12  part of a township is to be annexed, the board shall consider 
 10.13  whether the remainder of the township can continue to carry on 
 10.14  the functions of government without undue hardship.  The board 
 10.15  shall deny the annexation if it finds that the increase in 
 10.16  revenues for the annexing municipality bears no reasonable 
 10.17  relation to the monetary value of benefits conferred upon the 
 10.18  annexed area.  The board may deny the annexation (a) if it 
 10.19  appears that annexation of all or a part of the property to an 
 10.20  adjacent municipality would better serve the interests of the 
 10.21  residents of the property or (b) if the remainder of the 
 10.22  township would suffer undue hardship. 
 10.23     The board may alter the boundaries of the area to be 
 10.24  annexed by increasing or decreasing the area so as to include 
 10.25  only that property which is now or is about to become urban or 
 10.26  suburban in character or to add property of such character 
 10.27  abutting the area proposed for annexation in order to preserve 
 10.28  or improve the symmetry of the area, or to exclude property that 
 10.29  may better be served by another unit of government.  The board 
 10.30  may also alter the boundaries of the proposed annexation so as 
 10.31  to follow visible, clearly recognizable physical features.  If 
 10.32  the board determines that part of the area would be better 
 10.33  served by another municipality or township, the board may 
 10.34  initiate and approve annexation on its own motion by conducting 
 10.35  further hearings and issuing orders pursuant to subdivisions 
 10.36  3, and 4, and 5.  In all cases, the board shall set forth the 
 11.1   factors which are the basis for the decision. 
 11.2      Sec. 10.  Minnesota Statutes 1994, section 414.0325, 
 11.3   subdivision 1, is amended to read: 
 11.4      Subdivision 1.  [INITIATING THE PROCEEDING.] One or more 
 11.5   townships and one or more municipalities, by joint resolution, 
 11.6   may designate an unincorporated area as in need of orderly 
 11.7   annexation and may.  The joint resolution will confer 
 11.8   jurisdiction on the board over annexations in the designated 
 11.9   area and over the various provisions in said agreement by 
 11.10  submission of said joint resolution to the executive director.  
 11.11  The resolution shall include a description of the designated 
 11.12  area and the reasons for designation.  Thereafter, an annexation 
 11.13  of any part of the designated area may be initiated by: 
 11.14     (1) submitting to the executive director a resolution of 
 11.15  any signatory to the joint resolution; or by 
 11.16     (2) the board of its own motion; or 
 11.17     (3) as provided in section 414.033, subdivision 2a. 
 11.18     Whenever the pollution control agency or other state agency 
 11.19  pursuant to sections 115.03, 115.071, 115.49, or any law giving 
 11.20  a state agency similar powers, orders a municipality to extend a 
 11.21  municipal service to a designated unincorporated an area, such 
 11.22  an order will confer jurisdiction on the Minnesota municipal 
 11.23  board to consider designation of the area for orderly annexation.
 11.24     If a joint resolution designates an area as in need of 
 11.25  orderly annexation and states that no alteration of its stated 
 11.26  boundaries is appropriate, the board may review and comment, but 
 11.27  may not alter the boundaries.  
 11.28     If a joint resolution designates an area as in need of 
 11.29  orderly annexation, provides for the conditions for its 
 11.30  annexation, and states that no consideration by the board is 
 11.31  necessary, the board may review and comment, but shall, within 
 11.32  30 days, order the annexation in accordance with the terms of 
 11.33  the resolution. 
 11.34     Sec. 11.  Minnesota Statutes 1994, section 414.0325, 
 11.35  subdivision 1a, is amended to read: 
 11.36     Subd. 1a.  [ORDERLY ANNEXATION BY PETITION ELECTRIC UTILITY 
 12.1   SERVICE NOTICE.] If the board receives a petition for annexation 
 12.2   of an area owned by a municipality or from all of the property 
 12.3   owners in an area, and the area is within two miles of the 
 12.4   corporate boundaries of the municipality, the petition shall 
 12.5   confer jurisdiction on the board to consider designation of the 
 12.6   area for orderly annexation. Upon receipt of the petition, the 
 12.7   board shall inform the affected parties of their opportunity to 
 12.8   request a hearing before the board on the petition, and if a 
 12.9   hearing is requested, it must be held within 60 days of the 
 12.10  request.  Any person aggrieved by the board's designation of an 
 12.11  area as appropriate for orderly annexation may appeal the 
 12.12  board's order to district court in accordance with section 
 12.13  414.07. 
 12.14     At least 60 days before a petition is filed under this 
 12.15  section or section 414.033, the petitioner must notify the 
 12.16  municipality that the petitioner intends to file a petition for 
 12.17  annexation.  At least 30 days before a petition is filed for 
 12.18  annexation under this subdivision or section 414.033, the 
 12.19  petitioner must be notified by the municipality that the cost of 
 12.20  electric utility service to the petitioner may change if the 
 12.21  land is annexed to the municipality.  The notice must include an 
 12.22  estimate of the cost impact of any change in electric utility 
 12.23  services, including rate changes and assessments, resulting from 
 12.24  the annexation. 
 12.25     Sec. 12.  Minnesota Statutes 1994, section 414.0325, 
 12.26  subdivision 3, is amended to read: 
 12.27     Subd. 3.  [BOARD'S ORDER.] In arriving at its decision, the 
 12.28  board shall consider the following factors: in section 414.031, 
 12.29  subdivision 4. 
 12.30     (a) Present population, past population growth and 
 12.31  projected population of the property proposed for annexation and 
 12.32  the annexing municipality; 
 12.33     (b) Quantity of land within the property proposed for 
 12.34  annexation and the annexing municipality; and natural terrain 
 12.35  including general topography, major watersheds, soil conditions 
 12.36  and such natural features as rivers, lakes and major bluffs; 
 13.1      (c) Degree of contiguity of the boundaries between the 
 13.2   annexing municipality and the property proposed for annexation; 
 13.3      (d) Present pattern of physical development of the property 
 13.4   proposed for annexation and the annexing municipality including 
 13.5   residential, industrial, commercial, agricultural and 
 13.6   institutional land uses; the present transportation network and 
 13.7   potential transportation issues, including proposed highway 
 13.8   development; 
 13.9      (e) Land use controls and planning presently being utilized 
 13.10  in the annexing municipality and the property proposed for 
 13.11  annexation, including comprehensive plans for development in the 
 13.12  area and plans and policies of the metropolitan council.  If 
 13.13  there is an inconsistency between the proposed development and 
 13.14  the land use planning ordinance in force, the reason for the 
 13.15  inconsistency; 
 13.16     (f) Present governmental services being provided in the 
 13.17  annexing municipality and the property proposed for annexation, 
 13.18  including water and sewer service, fire rating and protection, 
 13.19  police protection, street improvements and maintenance, 
 13.20  administrative services, and recreational facilities; 
 13.21     (g) Existing or potential problems of environmental 
 13.22  pollution and the need for additional services to resolve these 
 13.23  problems; 
 13.24     (h) Plans and programs by the annexing municipality for 
 13.25  providing needed governmental services to the property proposed 
 13.26  for annexation; 
 13.27     (i) Fiscal data of the annexing municipality and the 
 13.28  property proposed for annexation, including net tax capacity and 
 13.29  the present bonded indebtedness, and the local tax rates of the 
 13.30  county, school district, and township; 
 13.31     (j) Relationship and effect of the proposed annexation on 
 13.32  communities adjacent to the area and on school districts within 
 13.33  and adjacent to the area; 
 13.34     (k) Adequacy of town government to deliver necessary 
 13.35  services to the property proposed for annexation; 
 13.36     (l) Analysis of whether the needed governmental services 
 14.1   can best be provided through incorporation or annexation to an 
 14.2   adjacent municipality; and 
 14.3      (m) If only a part of a township is annexed, the ability of 
 14.4   the remainder of the township to continue or the feasibility of 
 14.5   it being incorporated separately or being annexed to another 
 14.6   municipality. 
 14.7      Based upon these factors in section 414.031, subdivision 4, 
 14.8   the board may order the annexation: 
 14.9      (a) if it finds that the subject area proposed for 
 14.10  annexation (a) is now or is about to become urban or suburban in 
 14.11  character and that the annexing municipality is capable of 
 14.12  providing the services required by the area within a reasonable 
 14.13  time; or (b) if it finds that the existing township form of 
 14.14  government is not adequate to protect the public health, safety, 
 14.15  and welfare; or (c) if it finds that annexation would be in the 
 14.16  best interests of the area proposed for annexation subject 
 14.17  area.  The board may deny the annexation if it conflicts with 
 14.18  any provision of the joint agreement. The board may alter the 
 14.19  boundaries of the proposed annexation by increasing or 
 14.20  decreasing the area so as to include that property within the 
 14.21  designated area which is in need of municipal services or will 
 14.22  be in need of municipal services. 
 14.23     If the annexation is denied, no proceeding for the 
 14.24  annexation of substantially the same area may be initiated 
 14.25  within two years from the date of the board's order unless the 
 14.26  new proceeding is initiated by a majority of the area's property 
 14.27  owners and the petition is supported by affected parties to the 
 14.28  resolution.  In all cases, the board shall set forth the factors 
 14.29  which are the basis for the decision. 
 14.30     Sec. 13.  Minnesota Statutes 1994, section 414.033, 
 14.31  subdivision 5, is amended to read: 
 14.32     Subd. 5.  If the land is platted, or, if unplatted, does 
 14.33  not exceed 200 acres, a majority of the property owners in 
 14.34  number may petition the municipal council to have such land 
 14.35  included within the abutting municipality and, within ten days 
 14.36  thereafter, shall file copies of the petition with the board, 
 15.1   the town board, the county board and the municipal council of 
 15.2   any other municipality which borders the land to be annexed.  
 15.3   Within 90 days from the date of service, the town board or the 
 15.4   municipal council of such abutting municipality may submit 
 15.5   written objections to the annexation to the board and the 
 15.6   annexing municipality.  Upon receipt of such objections, the 
 15.7   board shall proceed to hold a hearing and issue its order in 
 15.8   accordance with section 414.031, subdivisions 3, and 4, and 5. 
 15.9   If written objections are not submitted within the time 
 15.10  specified hereunder in this section and if the municipal council 
 15.11  determines that property proposed for the annexation is now or 
 15.12  is about to become urban or suburban in character, it may by 
 15.13  ordinance declare such land annexed to the municipality.  If the 
 15.14  petition is not signed by all the property owners of the land 
 15.15  proposed to be annexed, the ordinance shall not be enacted until 
 15.16  the municipal council has held a hearing on the proposed 
 15.17  annexation after at least 30 days mailed notice to all property 
 15.18  owners within the area to be annexed. 
 15.19     Sec. 14.  Minnesota Statutes 1994, section 414.033, is 
 15.20  amended by adding a subdivision to read: 
 15.21     Subd. 13.  [ELECTRIC UTILITY SERVICE NOTICE.] At least 60 
 15.22  days before a petition is filed under section 414.0325 or this 
 15.23  section, the petitioner must notify the municipality that the 
 15.24  petitioner intends to file a petition for annexation.  At least 
 15.25  30 days before a petition is filed for annexation, the 
 15.26  petitioner must be notified by the municipality that the cost of 
 15.27  electric utility service to the petitioner may change if the 
 15.28  land is annexed to the municipality.  The notice must include an 
 15.29  estimate of the cost impact of any change in electric utility 
 15.30  services, including rate changes and assessments, resulting from 
 15.31  the annexation.  
 15.32     Sec. 15.  Minnesota Statutes 1994, section 414.041, 
 15.33  subdivision 3, is amended to read: 
 15.34     Subd. 3.  [COMMISSION'S HEARING AND REPORT.] The 
 15.35  consolidation commission shall conduct hearings regarding the 
 15.36  proposed consolidation.  The hearings shall include, but are not 
 16.1   limited to, the following subjects:  
 16.2      (a) The contents of any city charter for the proposed 
 16.3   consolidated city or the form of government of the proposed 
 16.4   consolidated city; 
 16.5      (b) Analysis of whether a ward system shall be included in 
 16.6   the form of government of the proposed consolidated city; and 
 16.7      (c) Each factor considered by the board under section 
 16.8   414.02, subdivision 5, clauses (a) to (i) 3.  
 16.9      Based on these factors and upon other matters which come 
 16.10  before the consolidation commission, the commission shall issue 
 16.11  a report to the municipal board with findings and 
 16.12  recommendations within two years from the date of the board's 
 16.13  initial appointment of the commission.  
 16.14     Sec. 16.  Minnesota Statutes 1994, section 414.041, 
 16.15  subdivision 5, is amended to read: 
 16.16     Subd. 5.  [BOARD'S ORDER.] In arriving at its decision, the 
 16.17  board shall consider the following factors: in section 414.02, 
 16.18  subdivision 3. 
 16.19     (a) Present population, past population growth and 
 16.20  projected population of the included municipalities; 
 16.21     (b) Quantity of land within the included municipalities; 
 16.22  and natural terrain including general topography, major 
 16.23  watersheds, soil conditions, and such natural features as 
 16.24  rivers, lakes and major bluffs; 
 16.25     (c) Degree of contiguity of the boundaries between the 
 16.26  included municipalities; 
 16.27     (d) Analysis of whether present planning and physical 
 16.28  development in the included municipalities indicates that the 
 16.29  consolidation of these municipalities will benefit planning and 
 16.30  land use patterns in the area; the present transportation 
 16.31  network and potential transportation issues, including proposed 
 16.32  highway development; 
 16.33     (e) Analysis of whether consolidation of the included 
 16.34  municipalities is consistent with comprehensive plans for the 
 16.35  area; 
 16.36     (f) Analysis of whether governmental services now available 
 17.1   in the included municipalities can be more effectively or more 
 17.2   economically provided by consolidation; 
 17.3      (g) Analysis of whether there are existing or potential 
 17.4   environmental problems and whether municipal consolidation will 
 17.5   help improve such conditions; 
 17.6      (h) Analysis of tax and governmental aid issues involved in 
 17.7   the consolidation of the included municipalities; and 
 17.8      (i) Analysis of the effect of consolidation on area school 
 17.9   districts. 
 17.10     (j) Analysis of the applicability of the state building 
 17.11  code.  
 17.12     The board shall consider and may accept, amend, return to 
 17.13  the commission for amendment or further study, or reject the 
 17.14  commission's findings and recommendations based upon the board's 
 17.15  written determination of what is in the best interests of the 
 17.16  affected municipalities.  
 17.17     The board shall order the consolidation if it finds that 
 17.18  consolidation will be for the best interests of the 
 17.19  municipalities.  In all cases, the board shall set forth the 
 17.20  factors which are the basis for the decision.  
 17.21     If the board orders consolidation, it shall provide for 
 17.22  election of new municipal officers in accordance with section 
 17.23  414.09.  If the most populous of the included municipalities is 
 17.24  a statutory city, the new municipality shall be a statutory city 
 17.25  and the plan of government shall be Optional Plan A, provided 
 17.26  that an alternate plan may be adopted pursuant to section 
 17.27  412.551, at any time.  If the most populous of the included 
 17.28  municipalities is a home rule charter city or organized under a 
 17.29  statute other than chapter 412, the new municipality shall be 
 17.30  governed by its home rule charter or the statutory form under 
 17.31  which it is governed except that any ward system for the 
 17.32  election of council members shall be inoperable.  If the 
 17.33  commission's findings and recommendations include a proposed 
 17.34  home rule charter for the new municipality, the board may in its 
 17.35  order combine the issue of the adoption of the charter and the 
 17.36  vote on approval of the order for consolidation into one 
 18.1   question on the ballot, and shall submit it in a special or 
 18.2   general election as provided in section 410.10.  The ordinances 
 18.3   of all of the included municipalities shall continue in effect 
 18.4   within their former boundaries until repealed by the governing 
 18.5   body of the new municipality. 
 18.6      Notwithstanding any other provision of law to the contrary, 
 18.7   the board may in its order establish a ward system in the new 
 18.8   municipality, in which event it shall establish not less than 
 18.9   three nor more than seven wards, each of which shall elect one 
 18.10  council member.  When more than two years have elapsed after 
 18.11  consolidation, the governing body may, by a four-fifths vote, 
 18.12  abolish the ward system. 
 18.13     The new municipality shall assume the name of the most 
 18.14  populous municipality unless previous to the election another 
 18.15  name is chosen by joint resolution of a majority of the included 
 18.16  municipalities or by the consolidation commission. 
 18.17     The number of license privileges existing in the included 
 18.18  municipalities prior to consolidation and pursuant to state law 
 18.19  shall not be diminished as a result of the consolidation. 
 18.20     If the consolidation is denied or defeated in a referendum, 
 18.21  no proceeding for the consolidation of the same municipalities 
 18.22  may be initiated within two years from the date of the board's 
 18.23  order unless authorized by the board. 
 18.24     Sec. 17.  Minnesota Statutes 1994, section 414.061, 
 18.25  subdivision 4, is amended to read: 
 18.26     Subd. 4.  [BOARD INITIATION.] The board may initiate 
 18.27  proceedings for the concurrent detachment and annexation of 
 18.28  portions of one municipality completely surrounded by another 
 18.29  municipality, on its own motion or upon the petition of all of 
 18.30  the owners of property in the completely surrounded area.  In 
 18.31  such cases the board shall conduct hearings and issue its order 
 18.32  as in the case of consolidations of two or more municipalities 
 18.33  under sections 414.041, subdivision 5, and pursuant to section 
 18.34  414.09.  In arriving at its decision, the board shall consider 
 18.35  the factors in section 414.02, subdivision 3.  The board shall 
 18.36  order the proposed action if it finds that it will be for the 
 19.1   best interests of the municipalities and the property owners.  
 19.2   In all cases, the board shall set forth the factors which are 
 19.3   the basis for the decision. 
 19.4      Sec. 18.  Minnesota Statutes 1994, section 414.061, 
 19.5   subdivision 5, is amended to read: 
 19.6      Subd. 5.  [PROPERTY OWNER INITIATION.] Property owners may 
 19.7   initiate proceedings for the concurrent detachment of their 
 19.8   property from one municipality and its annexation to an adjacent 
 19.9   municipality by a petition signed by all of them that they 
 19.10  submit to the board accompanied by a resolution of the city 
 19.11  council of at least one of the affected municipalities.  The 
 19.12  board shall conduct hearings and issue its order as in the case 
 19.13  of consolidations of two or more municipalities under sections 
 19.14  414.041, subdivision 5 and pursuant to section 414.09.  In 
 19.15  arriving at its decision, the board shall consider the factors 
 19.16  in section 414.02, subdivision 3.  The board shall order the 
 19.17  proposed action if it finds that it will be for the best 
 19.18  interests of the municipalities and the property owner.  In all 
 19.19  cases, the board shall set forth the factors which are the basis 
 19.20  for the decision. 
 19.21     Sec. 19.  [REPEALER.] 
 19.22     Minnesota Statutes 1994, sections 414.01, subdivisions 3, 
 19.23  3a, and 4; and 414.061, subdivision 4a, are repealed. 
 19.24     Sec. 20.  [EFFECTIVE DATE.] 
 19.25     Sections 1 to 19 are effective August 1, 1996, to apply to 
 19.26  petitions filed after July 31, 1996.