1.1                          A bill for an act 
  1.2             relating to annexation; limiting annexation of urban 
  1.3             towns to certain processes; providing for the election 
  1.4             of municipal council members after certain 
  1.5             annexations; providing for reversion of annexed 
  1.6             property to the township if services not provided in 
  1.7             two years; limiting the municipal tax rate to the 
  1.8             township rate applicable prior to annexation until 
  1.9             sewer and water are provided; establishing a 
  1.10            moratorium on certain annexation decisions; amending 
  1.11            Minnesota Statutes 2000, sections 368.01, by adding a 
  1.12            subdivision; 414.031, subdivision 4a, by adding a 
  1.13            subdivision; 414.033, by adding subdivisions; 414.09, 
  1.14            subdivision 3. 
  1.15  BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.16     Section 1.  Minnesota Statutes 2000, section 368.01, is 
  1.17  amended by adding a subdivision to read: 
  1.18     Subd. 32.  [ANNEXATION EXEMPTION.] A town authorized to 
  1.19  exercise the powers enumerated in this section, or any portion 
  1.20  of the town, must not be annexed to a contiguous city except as 
  1.21  provided in sections 414.061 and 414.063. 
  1.22     Sec. 2.  Minnesota Statutes 2000, section 414.031, 
  1.23  subdivision 4a, is amended to read: 
  1.24     Subd. 4a.  [PROCEEDINGS INITIATED BY JOINT RESOLUTION.] ~~If~~ 
  1.25  ~~the proceeding has been initiated under subdivision 1, clause~~ 
  1.26  ~~(d),~~ Any annexation order under this section for annexation by a 
  1.27  single municipality of an entire township shall include a 
  1.28  provision for the election of new municipal officers in 
  1.29  accordance with section 414.09.  The expanded municipality shall 
  1.30  be governed by the home rule charter or statutory form which 
  2.1   governs the annexing municipality, except that any ward system 
  2.2   for the election of council members shall be inoperable.  The 
  2.3   ordinances of both the annexing municipality and the township 
  2.4   shall continue in effect within the former boundaries until 
  2.5   repealed by the governing body of the new municipality. 
  2.6      Notwithstanding any other provision of law to the contrary 
  2.7   the ~~board~~ director of the office of strategic and long-range 
  2.8   planning may provide for election of council members by wards, 
  2.9   not less than three nor more than seven in number, whose limits 
  2.10  are prescribed in the ~~board~~ order, upon a finding that area 
  2.11  representation is required to accord proper representation in 
  2.12  the municipality because of uneven population density in 
  2.13  different parts thereof or the existence of agricultural lands 
  2.14  therein which are in the path of suburban development; but after 
  2.15  four years from the effective date of an annexation the council 
  2.16  of the municipality may by resolution adopted by a four-fifths 
  2.17  vote abolish the ward system and provide for the election of all 
  2.18  council members at large. 
  2.19     Until the effective date of the annexation order, the town 
  2.20  board and other officers of the town shall continue to exercise 
  2.21  their powers and duties under the town laws in that portion of 
  2.22  the municipality that was formerly the town, and the council and 
  2.23  other officers of the annexing municipality shall continue to 
  2.24  exercise their powers and duties in that portion of the expanded 
  2.25  municipality that was formerly the municipality.  Thereafter the 
  2.26  town board and the council of the annexing municipality shall 
  2.27  have no jurisdiction within the municipality, and the new 
  2.28  municipal council and other new officers shall act in respect to 
  2.29  any matters previously undertaken by the town board of 
  2.30  supervisors or municipal council within the limits of the 
  2.31  expanded municipality, including the making of any improvement 
  2.32  and the levying of any special assessments therefor in the same 
  2.33  manner and to the same effect as if such improvement had been 
  2.34  undertaken by the municipality. 
  2.35     The new municipal council may continue or discontinue any 
  2.36  board that may have previously existed in the town or former 
  3.1   municipality. 
  3.2      Sec. 3.  Minnesota Statutes 2000, section 414.031, is 
  3.3   amended by adding a subdivision to read: 
  3.4      Subd. 7.  [REVERSION OF ANNEXED LAND.] The order for 
  3.5   annexation must specify what municipal services must be provided 
  3.6   in the annexed area within two years after the effective date of 
  3.7   the order.  At a minimum, sewer and water must be provided to 
  3.8   substantially all households and businesses in the area.  If the 
  3.9   services to be provided in the annexed area are not 
  3.10  substantially complete as required by the order, the entire area 
  3.11  annexed to the municipality is detached and reverts to the 
  3.12  township upon approval of a request by the township or by any 
  3.13  property owner in the annexed area.  The request may be made at 
  3.14  any time after two years after the effective date of the order.  
  3.15  The request must be made in writing and filed with the director 
  3.16  of the office of strategic and long-range planning, provided to 
  3.17  the municipality, to all affected property owners in the annexed 
  3.18  area who are not making the request, and, if the request is by a 
  3.19  property owner, to the town board of supervisors.  If the 
  3.20  director of the office determines that the services have not 
  3.21  been provided or are not substantially complete as required by 
  3.22  the order for annexation, the director shall approve the 
  3.23  detachment and reversion and notify all parties, the secretary 
  3.24  of state, the state demographer, the county auditor for each 
  3.25  affected county, the commissioner of revenue, and any other 
  3.26  person who has requested notice.  The detachment and reversion 
  3.27  is effective upon the director's order approving the request.  
  3.28  The detached area that reverts is relieved of responsibility for 
  3.29  any debt or other obligations of the municipality and may be 
  3.30  required to assume responsibility for debt and other obligations 
  3.31  of the township.  For the purposes of taxation, if the 
  3.32  detachment becomes effective on or before August 1 of a levy 
  3.33  year, the town or towns acquiring the detached area may levy on 
  3.34  it beginning with that same levy year.  If the detachment 
  3.35  becomes effective after August 1 of a levy year, the 
  3.36  municipality may continue to levy on the detached area for that 
  4.1   levy year, and the town or towns acquiring the detached area may 
  4.2   not levy on it until the following levy year. 
  4.3      Sec. 4.  Minnesota Statutes 2000, section 414.033, is 
  4.4   amended by adding a subdivision to read: 
  4.5      Subd. 14.  [REVERSION OF ANNEXED LAND.] The order for 
  4.6   annexation must specify what municipal services must be provided 
  4.7   in the annexed area within two years after the effective date of 
  4.8   the order.  At a minimum, sewer and water must be provided to 
  4.9   substantially all households and businesses in the area.  If the 
  4.10  services to be provided in the annexed area are not 
  4.11  substantially complete as required by the order, the entire area 
  4.12  annexed to the municipality is detached and reverts to the 
  4.13  township upon approval of a request by the township or by any 
  4.14  property owner in the annexed area.  The request may be made at 
  4.15  any time after two years after the effective date of the order.  
  4.16  The request must be made in writing and filed with the director 
  4.17  of the office of strategic and long-range planning, provided to 
  4.18  the municipality, to all affected property owners in the annexed 
  4.19  area who are not making the request, and, if the request is by a 
  4.20  property owner, to the town board of supervisors.  If the 
  4.21  director of the office determines that the services have not 
  4.22  been provided or are not substantially completed as required by 
  4.23  the order for annexation, the director shall approve the 
  4.24  detachment and reversion and notify all parties, the secretary 
  4.25  of state, the state demographer, the county auditor for each 
  4.26  affected county, the commissioner of revenue, and any other 
  4.27  person who has requested notice.  The detachment and reversion 
  4.28  is effective upon the director's order approving the request.  
  4.29  The detached area that reverts is relieved of responsibility for 
  4.30  any debt or other obligations of the municipality and may be 
  4.31  required to assume responsibility for debt and other obligations 
  4.32  of the township.  For the purposes of taxation, if the 
  4.33  detachment becomes effective on or before August 1 of a levy 
  4.34  year, the town or towns acquiring the detached area may levy on 
  4.35  it beginning with that same levy year.  If the detachment 
  4.36  becomes effective after August 1 of a levy year, the 
  5.1   municipality may continue to levy on the detached area for that 
  5.2   levy year, and the town or towns acquiring the detached area may 
  5.3   not levy on it until the following levy year. 
  5.4      Sec. 5.  Minnesota Statutes 2000, section 414.033, is 
  5.5   amended by adding a subdivision to read: 
  5.6      Subd. 12a.  [PROPERTY TAX RATE; TOWNSHIP RATE TO APPLY.] An 
  5.7   area annexed under subdivision 2, clause (2), is established as 
  5.8   a separate taxing area in the annexing municipality.  Within the 
  5.9   separate taxing area, the municipality may not impose a tax rate 
  5.10  higher than the tax rate imposed by the township in that area 
  5.11  for the taxes payable year in which the annexation was effective 
  5.12  until the municipality has provided sewer and water service to 
  5.13  substantially all of the annexed area.  Once sewer and water 
  5.14  have been provided to substantially all properties in the 
  5.15  annexed area, the limitations of this subdivision no longer 
  5.16  apply. 
  5.17     Sec. 6.  Minnesota Statutes 2000, section 414.09, 
  5.18  subdivision 3, is amended to read: 
  5.19     Subd. 3.  [ELECTIONS OF MUNICIPAL OFFICERS.] An order 
  5.20  approving an incorporation or consolidation pursuant to this 
  5.21  chapter, or an order requiring an election under section 
  5.22  414.031, subdivision 4a, shall set a date for this election of 
  5.23  new municipal officers not less than 45 days nor more than 60 
  5.24  days after the issuance of such order.  
  5.25     The ~~board~~ director shall appoint an acting clerk for 
  5.26  election purposes, at least three election judges who shall be 
  5.27  residents of the new municipality, and shall designate polling 
  5.28  places within the new municipality. 
  5.29     The acting clerk shall prepare the official election 
  5.30  ballot.  Affidavits of candidacy may be filed by any person 
  5.31  eligible to hold municipal office not more than four weeks nor 
  5.32  less than two weeks before the date designated ~~by the board~~ in 
  5.33  the order for the election.  
  5.34     The election shall be conducted in conformity with the 
  5.35  charter and the laws for conducting municipal elections insofar 
  5.36  as applicable.  Any person eligible to vote at a township or 
  6.1   municipal election within the area of the new municipality, is 
  6.2   eligible to vote at such election. 
  6.3      Any excess in the expense of conducting the election over 
  6.4   receipts from filing fees shall be a charge against the new 
  6.5   municipality; any excess of receipts shall be deposited in the 
  6.6   treasury of the new municipality. 
  6.7      Sec. 7.  [ANNEXATION MORATORIUM.] 
  6.8      An annexation proceeding under Minnesota Statutes, sections 
  6.9   414.031, 414.033, or that requires a hearing before a final 
  6.10  order is issued may be begun but the director of the office of 
  6.11  strategic and long-range planning or the director's designee 
  6.12  shall not issue a final order relating to such a proposed 
  6.13  annexation until the moratorium imposed by this section is 
  6.14  lifted by law.  Notwithstanding the moratorium imposed by this 
  6.15  section, the director of the office of strategic and long-range 
  6.16  planning, or the director's designee, may issue a final order if 
  6.17  the governing body of each city and town involved in the matter 
  6.18  adopts a joint resolution requesting the director to issue a 
  6.19  final order and all property owners in the area to be annexed 
  6.20  agree in writing to the request for a final order.  This section 
  6.21  is effective March 15, 2002, and applies to annexation 
  6.22  proceedings begun on or after that date. 
  6.23     Sec. 8.  [EFFECTIVE DATE.] 
  6.24     (a) Sections 2 and 6 are effective the day following final 
  6.25  enactment and apply to annexations ordered on or after that date.
  6.26     (b) Sections 3 and 4 apply to any annexation effective on 
  6.27  or after June 1, 2000, and are effective the day following final 
  6.28  enactment.  For annexations effective before the effective date 
  6.29  of sections 3 and 4, the two-year period in which to provide 
  6.30  sewer and water begins on the effective date of sections 3 and 4.
  6.31     (c) Section 5 applies to any annexation effective on or 
  6.32  after June 1, 2000, and is effective for taxes payable in 2003 
  6.33  and after.