2007 Minnesota Statutes

CHAPTER 414. MUNICIPAL BOUNDARY ADJUSTMENTS

414.01 ENABLING PROVISIONS FOR MUNICIPAL BOUNDARY ADJUSTMENTS.
    Subdivision 1. A duty of planning director. Among the duties of the director of the Office
of Strategic and Long-Range Planning is the duty to conduct proceedings, make determinations,
and issue orders for the creation of a municipality, the combination of two or more governmental
units, or the alteration of a municipal boundary.
    Subd. 1a. Legislative findings. The legislature finds that:
(1) sound urban development and preservation of agricultural land and open spaces through
land use planning is essential to the continued economic growth of this state;
(2) municipal government most efficiently provides governmental services in areas
intensively developed for residential, commercial, industrial, and governmental purposes; and
township government most efficiently provides governmental services in areas used or developed
for agricultural, open space, and rural residential purposes;
(3) the public interest requires that municipalities be formed when there exists or will likely
exist the necessary resources to provide for their economical and efficient operation;
(4) annexation to existing municipalities of unincorporated areas unable to supply municipal
services should be facilitated; and
(5) long-range joint powers planning or other cooperative efforts among counties, cities,
and towns should be encouraged.
    Subd. 1b. Goals in promoting, regulating municipal development. The director may
promote and regulate development of municipalities:
(1) to provide for the extension of municipal government to areas which are developed or
are in the process of being developed for intensive use for residential, commercial, industrial,
institutional, and governmental purposes or are needed for such purposes; and
(2) to protect the stability of unincorporated areas which are used or developed for
agricultural, open space, and rural residential purposes and are not presently needed for more
intensive uses; and
(3) to protect the integrity of land use planning in municipalities and unincorporated areas so
that the public interest in efficient local government will be properly recognized and served.
    Subd. 2.[Repealed, 2002 c 223 s 29]
    Subd. 3.[Repealed, 1996 c 303 s 19]
    Subd. 3a.[Repealed, 1996 c 303 s 19]
    Subd. 4.[Repealed, 1996 c 303 s 19]
    Subd. 5. Consolidation of proceedings. The director may order the consolidation of separate
proceedings in the interest of economy and expedience.
    Subd. 6.[Repealed, 1969 c 1139 s 87 subd 2]
    Subd. 6a.[Repealed, 2002 c 223 s 29]
    Subd. 7.[Repealed, 1969 c 1139 s 88 subd 2]
    Subd. 7a. Director's delegation like commissioner's. A power or duty of the director
under this chapter may be delegated by the director as provided in section 15.06, subdivision 6,
clause (1), for commissioners.
    Subd. 8. Planning commission contracts, consultants. The director may contract with
regional, state, county, or local planning commissions and hire expert consultants to provide
specialized information and assistance.
    Subd. 8a. Powers of conductor of proceedings. Any person conducting a proceeding under
this chapter may administer oaths and affirmations; issue subpoenas; compel the attendance and
testimony of witnesses, and the production of papers, books, and documents; examine witnesses;
and receive and report evidence.
    Subd. 9.[Repealed, 1969 c 1146 s 20]
    Subd. 10. Rulemaking authority. To carry out the duties and powers imposed upon the
director under this chapter, the director may adopt the rules, that are reasonably necessary,
in accordance with the procedure prescribed in the general laws relating to departments and
agencies of the state.
    Subd. 11. Schedule of filing fees. The director may prescribe a schedule of filing fees
for any petitions, resolutions or ordinances filed pursuant to this chapter by an appropriate
rule promulgated in accordance with the procedure prescribed in the general laws relating to
departments and agencies of the state for the issuance of administrative rules.
    Subd. 12. Request for hearing transcripts; costs. Any party may request the director
to cause a transcript of the hearing to be made. Any party requesting a copy of the transcript
is responsible for its costs.
    Subd. 13.[Repealed, 1969 c 1146 s 20]
    Subd. 14. Population of changed territory, new municipality. (a) When an order or
approval letter under this chapter enlarges or diminishes the area of an existing municipality or
town, the director shall communicate the order or approval letter to the municipality and the state
demographer. The municipality shall prepare an estimate of population and of the number of
households for the annexed or detached area of the municipality or town. The estimate shall be
certified by the state demographer. The estimate must estimate the population as of the effective
date of the order or approval letter and must be so dated.
(b) When a new municipality is created by an order under this chapter, the municipality
shall request a separation census from the United States Bureau of the Census and bear any
costs incurred.
    Subd. 15. Increased costs, levy period. When an order under this chapter enlarges an
existing municipality or creates a new municipality, the order may indicate the estimated increased
costs to the municipality as the result of the boundary adjustment, and the time period that the
municipality would be allowed a levy for these increased costs.
    Subd. 16. Compelled meetings; report. In any proceeding under this chapter, the director
or conductor of the proceeding may at any time in the process require representatives from the
involved city, town, county, political subdivision, or other governmental entity to meet together to
discuss resolution of issues raised by the petition or order that confers jurisdiction on the director
and other issues of mutual concern. The director or conductor of the proceeding may require
that the parties meet at least three times during a 60-day period. The parties shall designate
a person to report to the director or conductor of the proceeding on the results of the meetings
immediately after the last meeting.
    Subd. 17. Data from state agencies. The director may request information from any state
department or agency in order to assist in carrying out the director's duties under this chapter. The
department or agency shall promptly furnish the requested information.
History: 1959 c 686 s 1; 1961 c 645 s 1; 1963 c 807 s 1-5; 1965 c 45 s 58; 1965 c 899 s 1-5;
1965 c 901 s 22; 1969 c 1139 s 87 subd 1,88 subd 1; 1969 c 1146 s 1-6; 1973 c 123 art 5 s 7;
1973 c 621 s 1; 1973 c 650 art 4 s 18; 1975 c 271 s 6; 1976 c 134 s 70-72; 1977 c 57 s 1; 1978 c
705 s 1-8; 1980 c 487 s 22; 1981 c 268 s 1; 1983 c 305 s 24; 1985 c 79 s 1; 1985 c 248 s 70; 1986
c 444; 1987 c 384 art 2 s 1; 1Sp1989 c 1 art 5 s 29; 1994 c 511 s 1,2; 1996 c 303 s 1-7; 1997 c
87 s 3; 2002 c 223 s 1; 2006 c 270 art 2 s 2

414.011 DEFINITIONS.
    Subdivision 1. Application. For the purposes of this chapter, the terms defined in this section
have the meanings given them.
    Subd. 2. Municipality. "Municipality" means any city, however organized.
    Subd. 3. Incorporated land. "Incorporated land" means land within a municipality;
"unincorporated land" means land outside a municipality.
    Subd. 4. Property, area, land. The terms "property," "area," and "land" mean geographical
units of land within or outside a municipality, depending upon the context in which the term is
used.
    Subd. 5. Property owner. "Property owner" means the fee owner of land, or the beneficial
owner of land whose interest is primarily one of possession and enjoyment. The term includes,
but is not limited to, vendees under a contract for deed, and mortgagors. Any reference to a
percentage of property owners shall mean in number.
    Subd. 6. Abut, abuts, abutting. The terms "abut," "abuts," and "abutting" refer to areas
whose boundaries at least touch one another at a single point, including areas whose boundaries
would touch but for an intervening roadway, railroad, waterway or parcel of publicly owned land.
    Subd. 7. Boundary adjustment. "Boundary adjustment" means any proceeding authorized
by this chapter.
    Subd. 8.[Repealed, 2002 c 223 s 29]
    Subd. 9. Corporate boundary map. "Corporate boundary map" means a map which
accurately describes the boundaries of a municipality.
    Subd. 10. Plat map. "Plat map" means that document recorded in the office of the county
recorder in the county where the area is located.
    Subd. 11. Director. "Director" means the director of the Office of Strategic and Long-Range
Planning.
History: 1969 c 1146 s 7; 1973 c 123 art 5 s 7; 1978 c 705 s 9,10; 2002 c 223 s 2,3

414.012 FILING OF MAPS IN BOUNDARY ADJUSTMENT PROCEEDINGS.
    Subdivision 1. Corporate boundary map. A municipality initiating any boundary
adjustment authorized by this chapter shall file with the director a corporate boundary map. Any
proposed boundary adjustment shall be delineated on a copy of the corporate boundary map.
    Subd. 2. Plat maps. Any party initiating a boundary adjustment, which includes platted land,
shall file with the director maps which are necessary to support and identify the land description.
The maps shall include copies of plats.
History: 1978 c 705 s 11; 2002 c 223 s 4

414.02 EXCLUSIVE METHOD OF MUNICIPAL INCORPORATION.
    Subdivision 1. Initiating the proceedings. This section provides the exclusive method of
incorporating a municipality in Minnesota. Proceedings for incorporation of a municipality may
be initiated by petition of 100 or more property owners or by resolution of the town board within
an area which is not included within the limits of any incorporated municipality and which area
includes land that has been platted into lots and blocks in the manner provided by law. The
petition or resolution shall be submitted to the director and shall state the proposed name of the
municipality, the names of all parties entitled to mailed notice under section 414.09, the reason for
requesting incorporation, and shall include a proposed corporate boundary map.
    Subd. 1a. Notice of intent to incorporate. At least 30 days before submitting to the
director the petition or resolution under this section, the township must serve the clerk of each
municipality and each township that is contiguous to the township by certified mail a notice of
the township's intent to incorporate.
    Subd. 2. Hearing time, place. Upon receipt of a petition or resolution made pursuant to
subdivision 1, the director shall designate a time and place for a hearing in accordance with
section 414.09.
    Subd. 3. Relevant factors, order. (a) In arriving at a decision, the director shall consider
the following factors:
(1) present population and number of households, past population and projected population
growth for the subject area;
(2) quantity of land within the subject area; the natural terrain including recognizable
physical features, general topography, major watersheds, soil conditions and such natural features
as rivers, lakes and major bluffs;
(3) present pattern of physical development, planning, and intended land uses in the subject
area including residential, industrial, commercial, agricultural, and institutional land uses and the
impact of the proposed action on those uses;
(4) the present transportation network and potential transportation issues, including proposed
highway development;
(5) land use controls and planning presently being utilized in the subject area, including
comprehensive plans, policies of the Metropolitan Council; and whether there are inconsistencies
between proposed development and existing land use controls;
(6) existing levels of governmental services being provided to the subject area, including
water and sewer service, fire rating and protection, law enforcement, street improvements and
maintenance, administrative services, and recreational facilities and the impact of the proposed
action on the delivery of the services;
(7) existing or potential environmental problems and whether the proposed action is likely to
improve or resolve these problems;
(8) fiscal impact on the subject area and adjacent units of local government, including present
bonded indebtedness; local tax rates of the county, school district, and other governmental units,
including, where applicable, the net tax capacity of platted and unplatted lands and the division of
homestead and nonhomestead property; and other tax and governmental aid issues;
(9) relationship and effect of the proposed action on affected and adjacent school districts
and communities;
(10) whether delivery of services to the subject area can be adequately and economically
delivered by the existing government;
(11) analysis of whether necessary governmental services can best be provided through the
proposed action or another type of boundary adjustment;
(12) degree of contiguity of the boundaries of the subject area and adjacent units of local
government; and
(13) analysis of the applicability of the State Building Code.
(b) Based upon these factors, the director may order the incorporation on finding that:
(1) the property to be incorporated is now, or is about to become, urban or suburban in
character; or
(2) that the existing township form of government is not adequate to protect the public
health, safety, and welfare; or
(3) the proposed incorporation would be in the best interests of the area under consideration.
(c) The director may deny the incorporation if the area, or a part thereof, would be better
served by annexation to an adjacent municipality.
(d) The director may alter the boundaries of the proposed incorporation by increasing or
decreasing the area to be incorporated so as to include only that property which is now, or is
about to become, urban or suburban in character, or may exclude property that may be better
served by another unit of government. The director may also alter the boundaries of the proposed
incorporation so as to follow visible, clearly recognizable physical features for municipal
boundaries.
(e) In all cases, the director shall set forth the factors which are the basis for the decision.
(f) Notwithstanding any other provision of law to the contrary relating to the number of
wards which may be established, the director may provide for election of council members by
wards, not less than three nor more than seven in number, whose limits are prescribed in the
director's order upon a finding that area representation is required to accord proper representation
in the proposed incorporated area because of uneven population density in different parts thereof
or the existence of agricultural lands therein which are in the path of suburban development, but
after four years from the effective date of an incorporation the council of the municipality may by
resolution adopted by a four-fifths vote abolish the ward system and provide for the election of all
council members at large as in other municipalities.
(g) The director's order for incorporation shall provide for the election of municipal officers
in accordance with section 414.09. The plan of government shall be "Optional Plan A", provided
that an alternate plan may be adopted pursuant to section 412.551, at any time.
(h) The ordinances of the township in which the new municipality is located shall continue in
effect until repealed by the governing body of the new municipality.
    Subd. 4. Effective date of incorporation. The incorporation shall be effective upon the
election and qualification of new municipal officers or on such later date as is fixed by the
director's order.
History: 1959 c 686 s 2; 1961 c 645 s 2; 1963 c 807 s 6,7; 1965 c 899 s 6-11; 1969 c 1146 s
8; 1973 c 123 art 4 s 5; 1975 c 271 s 6; 1978 c 705 s 12; 1986 c 444; 1988 c 719 art 5 s 84; 1989
c 329 art 13 s 20; 1Sp1989 c 1 art 2 s 11; 1996 c 303 s 8; 2002 c 223 s 5; 2006 c 270 art 2 s 3

414.021 [Repealed, 1978 c 705 s 33]

414.03 [Repealed, 1969 c 1146 s 20]

414.031 ANNEXING UNINCORPORATED PROPERTY BY DIRECTOR'S ORDER.
    Subdivision 1. Initiating the proceeding. (a) A proceeding for the annexation of
unincorporated property abutting a municipality may be initiated by submitting to the director and
the affected township one of the following:
(1) a resolution of the annexing municipality;
(2) a resolution of the township containing the area proposed for annexation;
(3) a petition of 20 percent of the property owners or 100 property owners, whichever
is less, in the area to be annexed;
(4) a resolution of the municipal council together with a resolution of the township board
stating their desire to have the entire township annexed to the municipality.
(b) The petition, or resolution shall set forth the boundaries of the territory proposed for
annexation, the names of all parties entitled to notice under section 414.09, and the reasons
for requesting annexation.
(c) If the proceeding is initiated by a petition of property owners, the petition shall be
accompanied by a resolution of the annexing municipality supporting the petition.
    Subd. 1a. Notice of intent to annex. At least 30 days before submitting to the director a
petition or resolution under this section, the municipality must serve the township clerk of the
affected township by certified mail a notice of the municipality's intent to annex property within
the township. The notice must clearly identify the boundaries of the area proposed to be annexed.
    Subd. 2.[Repealed, 1973 c 621 s 9]
    Subd. 3. Hearing time, place. Upon receipt of a petition or resolution initiating an
annexation, the director shall designate a time and a place for a hearing in accordance with
section 414.09.
    Subd. 4. Relevant factors, order. (a) In arriving at a decision, the director shall consider
the following sources and factors:
(1) recordings and public documents from joint informational meetings under section
414.0333 relevant to other factors listed in this subdivision;
(2) present population and number of households, past population and projected population
growth of the annexing municipality and subject area and adjacent units of local government;
(3) quantity of land within the subject area and adjacent units of local government; and
natural terrain including recognizable physical features, general topography, major watersheds,
soil conditions and such natural features as rivers, lakes and major bluffs;
(4) degree of contiguity of the boundaries between the annexing municipality and the subject
area;
(5) present pattern of physical development, planning, and intended land uses in the subject
area and the annexing municipality including residential, industrial, commercial, agricultural and
institutional land uses and the impact of the proposed action on those land uses;
(6) the present transportation network and potential transportation issues, including proposed
highway development;
(7) land use controls and planning presently being utilized in the annexing municipality
and the subject area, including comprehensive plans for development in the area and plans and
policies of the Metropolitan Council, and whether there are inconsistencies between proposed
development and existing land use controls and the reasons therefore;
(8) existing levels of governmental services being provided in the annexing municipality and
the subject area, including water and sewer service, fire rating and protection, law enforcement,
street improvements and maintenance, administrative services, and recreational facilities and the
impact of the proposed action on the delivery of said services;
(9) the implementation of previous annexation agreements and orders;
(10) existing or potential environmental problems and whether the proposed action is likely
to improve or resolve these problems;
(11) plans and programs by the annexing municipality for providing needed and enhanced
governmental services to the subject area in a cost-effective and feasible manner within a
reasonable time from the date of the annexation;
(12) an analysis of the fiscal impact on the annexing municipality, the subject area,
and adjacent units of local government, including net tax capacity and the present bonded
indebtedness, and the local tax rates of the county, school district, and township;
(13) relationship and effect of the proposed action on affected and adjacent school districts
and communities;
(14) adequacy of town government to deliver services to the subject area;
(15) analysis of whether necessary governmental services can best be provided through the
proposed action or another type of boundary adjustment; and
(16) if only a part of a township is annexed, the ability of the remainder of the township
to continue or the feasibility of it being incorporated separately or being annexed to another
municipality.
(b) Based upon the factors, the director may order the annexation on finding:
(1) that the subject area is now, or is about to become, urban or suburban in character;
(2) that municipal government in the area proposed for annexation is required to protect the
public health, safety, and welfare; or
(3) that the annexation would be in the best interest of the subject area.
(c) If only a part of a township is to be annexed, the director shall consider whether the
remainder of the township can continue to carry on the functions of government without undue
hardship.
(d) The director shall deny the annexation on finding that the increase in revenues for the
annexing municipality bears no reasonable relation to the monetary value of benefits conferred
upon the annexed area.
(e) The director may deny the annexation on finding:
(1) that annexation of all or a part of the property to an adjacent municipality would better
serve the interests of the residents of the property; or
(2) that the remainder of the township would suffer undue hardship.
(f) The director may alter the boundaries of the area to be annexed by increasing or
decreasing the area so as to include only that property which is now or is about to become urban
or suburban in character or to add property of such character abutting the area proposed for
annexation in order to preserve or improve the symmetry of the area, or to exclude property that
may better be served by another unit of government.
(g) The director may also alter the boundaries of the proposed annexation so as to follow
visible, clearly recognizable physical features.
(h) If the director determines that part of the area would be better served by another
municipality or township, the director may initiate and approve annexation by conducting further
hearings and issuing orders pursuant to subdivisions 3 and 4.
(i) In all cases, the director shall set forth the factors which are the basis for the decision.
    Subd. 4a. Providing for election of new municipal officers. (a) Any annexation order
under this section for annexation by a single municipality of an entire township shall include a
provision for the election of new municipal officers in accordance with section 414.09. The
director of the office of strategic and long-range planning, or the director's designee, may also
order an election of new municipal officers in accordance with section 414.09 as part of any other
annexation order under this section if the director or the director's designee determines that
such an election would be equitable.
(b) The expanded municipality shall be governed by the home rule charter or statutory
form which governs the annexing municipality, except that any ward system for the election of
council members shall be inoperable.
(c) The ordinances of both the annexing municipality and the township shall continue in
effect within the former boundaries until repealed by the governing body of the new municipality.
(d) Notwithstanding any other provision of law to the contrary, the director of the Office
of Strategic and Long-Range Planning, or the director's designee, may provide for election of
council members by wards, not less than three nor more than seven in number, whose limits are
prescribed in the director's order, upon a finding that area representation is required to accord
proper representation in the municipality because of uneven population density in different
parts thereof or the existence of agricultural lands therein which are in the path of suburban
development; but after four years from the effective date of an annexation the council of the
municipality may by resolution adopted by a four-fifths vote abolish the ward system and provide
for the election of all council members at large.
(e) Until the effective date of the annexation order, the town board and other officers of the
town shall continue to exercise their powers and duties under the town laws in that portion of
the municipality that was formerly the town, and the council and other officers of the annexing
municipality shall continue to exercise their powers and duties in that portion of the expanded
municipality that was formerly the municipality. Thereafter the town board and the council of the
annexing municipality shall have no jurisdiction within the municipality, and the new municipal
council and other new officers shall act in respect to any matters previously undertaken by the
town board of supervisors or municipal council within the limits of the expanded municipality,
including the making of any improvement and the levying of any special assessments therefor
in the same manner and to the same effect as if such improvement had been undertaken by the
municipality.
(f) The new municipal council may continue or discontinue any board that may have
previously existed in the town or former municipality.
    Subd. 5.[Repealed, 1992 c 556 s 12]
    Subd. 6. Effective date of annexation. The annexation shall be effective as of the date fixed
in the annexation order or on a later date fixed in the annexation order.
    Subd. 7. Copy to county auditors. A copy of the annexation order must be delivered
immediately by the director to the appropriate county auditors.
    Subd. 8. Timing for tax levy. For the purposes of taxation, if the annexation becomes
effective on or before August 1 of a levy year, the municipality may levy on the annexed area
beginning with that same levy year. If the annexation becomes effective after August 1 of a levy
year, the town may continue to levy on the annexed area for that levy year, and the municipality
may not levy on the annexed area until the following levy year.
History: 1969 c 1146 s 10; 1973 c 123 art 5 s 7; 1973 c 621 s 11; 1975 c 271 s 6; 1978 c 705
s 13; 1986 c 444; 1988 c 719 art 5 s 84; 1989 c 329 art 13 s 20; 1Sp1989 c 1 art 2 s 11; 1991 c
291 art 12 s 22; 1996 c 303 s 9; 2002 c 223 s 6; 2002 c 235 s 1; 2006 c 270 art 2 s 4,5

414.032 [Repealed, 1978 c 705 s 33]

414.0325 ORDERLY ANNEXATION IN DESIGNATED UNINCORPORATED AREA.
    Subdivision 1. Initiating the proceeding. (a) One or more townships and one or more
municipalities, by joint resolution, may designate an unincorporated area as in need of orderly
annexation. One or more municipalities, by joint resolution with the county, may designate an
unincorporated area in which there is no organized township government as in need of orderly
annexation.
(b) The joint resolution will confer jurisdiction on the director over annexations in the
designated area and over the various provisions in said agreement by submission of said joint
resolution to the director.
(c) The resolution shall include a description of the designated area and the reasons for
designation.
(d) Thereafter, an annexation of any part of the designated area may be initiated by:
(1) submitting to the director a resolution of any signatory to the joint resolution; or
(2) the director.
(e) Whenever a state agency, other than the pollution control agency, orders a municipality to
extend a municipal service to an area, the order confers jurisdiction on the director to consider
designation of the area for orderly annexation.
(f) If a joint resolution designates an area as in need of orderly annexation and states that
no alteration of its stated boundaries is appropriate, the director may review and comment, but
may not alter the boundaries.
(g) If a joint resolution designates an area as in need of orderly annexation, provides for the
conditions for its annexation, and states that no consideration by the director is necessary, the
director may review and comment, but shall, within 30 days, order the annexation in accordance
with the terms of the resolution.
    Subd. 1a. Electric utility service notice. At least 60 days before a petition is filed under
this section or section 414.033, the petitioner must notify the municipality that the petitioner
intends to file a petition for annexation. At least 30 days before a petition is filed for annexation,
the petitioner must be notified by the municipality that the cost of electric utility service to the
petitioner may change if the land is annexed to the municipality. The notice must include an
estimate of the cost impact of any change in electric utility services, including rate changes and
assessments, resulting from the annexation.
    Subd. 1b. Notice of intent to designate an area. At least ten days before the municipality or
township adopts an orderly annexation agreement, a notice of the intent to include property in
an orderly annexation area must be published in a newspaper of general circulation in both the
township and municipality. The notice must clearly identify the boundaries of the area proposed
to be included in the orderly annexation agreement and the date, time, and place of the public
informational meeting to be held as provided in section 414.0333. The cost of providing notice
must be equally divided between the municipality and the township, unless otherwise agreed upon
by the municipality and the township. This subdivision applies only to the initial designation to
include property in an orderly annexation area subject to the orderly annexation agreement and not
to any subsequent annexation of any property from within the designated orderly annexation area.
This subdivision also does not apply when the orderly annexation agreement only designates for
immediate annexation property for which all of the property owners have petitioned to be annexed.
    Subd. 2. Hearing time, place. Upon receipt of a resolution for annexation of a part of the
designated area, the director shall set a time and place for a hearing in accordance with section
414.09.
    Subd. 3. Relevant factors, order. (a) In arriving at a decision, the director shall consider
the factors in section 414.031, subdivision 4.
(b) Based upon factors in section 414.031, subdivision 4, the director may order the
annexation:
(1) on finding that the subject area is now or is about to become urban or suburban in
character and that the annexing municipality is capable of providing the services required by
the area within a reasonable time; or
(2) on finding that the existing township form of government is not adequate to protect the
public health, safety, and welfare; or
(3) on finding that annexation would be in the best interests of the subject area.
(c) The director may deny the annexation if it conflicts with any provision of the joint
agreement.
(d) The director may alter the boundaries of the proposed annexation by increasing or
decreasing the area so as to include that property within the designated area which is in need of
municipal services or will be in need of municipal services.
(e) If the annexation is denied, no proceeding for the annexation of substantially the same
area may be initiated within two years from the date of the denial order unless the new proceeding
is initiated by a majority of the area's property owners and the petition is supported by affected
parties to the resolution.
(f) In all cases, the director shall set forth the factors which are the basis for the decision.
    Subd. 4. Effective date of annexation. The director's order shall be effective upon the
issuance of the order or at such later time as is provided in the order.
    Subd. 4a. Copy to county auditors. A copy of the annexation order must be delivered
immediately by the director to the appropriate county auditors.
    Subd. 4b. Timing for tax levy. For the purposes of taxation, if the annexation becomes
effective on or before August 1 of a levy year, the municipality may levy on the annexed area
beginning with that same levy year. If the annexation becomes effective after August 1 of a levy
year, the town may continue to levy on the annexed area for that levy year, and the municipality
may not levy on the annexed area until the following levy year.
    Subd. 5. Planning in orderly annexation area. (a) A joint resolution may provide for the
establishment of a board to exercise planning and land use control authority within any area
designated as an orderly annexation area pursuant to this section, in the manner prescribed by
section 471.59, subdivisions 2 to 8, inclusive.
(b) A board established pursuant to a joint resolution shall have all of the powers contained
in sections 462.351 to 462.364, and shall have the authority to adopt and enforce the State Fire
Code promulgated pursuant to section 299F.011.
(c) The joint resolution may provide that joint planning and land use controls shall apply
to any or all parts of the area designated for orderly annexation as well as to any adjacent
unincorporated or incorporated area, provided that the area to be included shall be described in
the joint resolution.
(d) If the joint resolution does not provide for joint planning and land use control, the
following procedures shall govern:
(1) if the county and townships agree to exclude the area from their zoning and subdivision
ordinances, the municipality may extend its zoning and subdivision regulations to include the
entire orderly annexation area as provided in section 462.357, subdivision 1, and section 462.358,
subdivision 1 ; or
(2) if the county and township do not agree to such extraterritorial zoning and subdivision
regulation by the municipality, zoning and subdivision regulation within the orderly annexation
area shall be controlled by a three-member committee with one member appointed from each of
the municipal, town, and county governing bodies.
(e) The committee under paragraph (d), clause (2), shall:
(1) serve as the "governing body" and "board of appeals and adjustments," for purposes of
sections 462.357 and 462.358, within the orderly annexation area; and
(2) have all of the powers contained in sections 462.351 to 462.364, and the authority to
adopt and enforce the State Fire Code promulgated pursuant to section 299F.011.
    Subd. 6. Validity, effect of orderly annexation agreement. An orderly annexation
agreement is a binding contract upon all parties to the agreement and is enforceable in the district
court in the county in which the unincorporated property in question is located. The provisions of
an orderly annexation agreement are not preempted by any provision of this chapter unless the
agreement specifically provides so. If an orderly annexation agreement provides the exclusive
procedures by which the unincorporated property identified in the agreement may be annexed to
the municipality, the municipality shall not annex that property by any other procedure.
History: 1978 c 705 s 14; 1Sp1981 c 4 art 1 s 171,172; 1982 c 424 s 116; 1983 c 18 s 1;
1988 c 719 art 5 s 84; 1989 c 329 art 13 s 20; 1Sp1989 c 1 art 2 s 11; 1991 c 291 art 12 s 23;
1992 c 556 s 4; 1994 c 511 s 3; 1996 c 303 s 10-12; 1997 c 202 art 5 s 2; 2002 c 223 s 7; 2002 c
236 s 1; 2005 c 136 art 9 s 14; 2006 c 270 art 2 s 6,7; 2007 c 90 s 1

414.033 ANNEXATION BY ORDINANCE.
    Subdivision 1. Unincorporated property. Unincorporated property abutting a municipality
may be annexed to the municipality by ordinance as provided for in this section.
    Subd. 2. Conditions. A municipal council may by ordinance declare land annexed to
the municipality and any such land is deemed to be urban or suburban in character or about
to become so if:
    (1) the land is owned by the municipality;
    (2) the land is completely surrounded by land within the municipal limits;
    (3) the land abuts the municipality and the area to be annexed is 120 acres or less, and the
area to be annexed is not presently served by public wastewater facilities or public wastewater
facilities are not otherwise available, and the municipality receives a petition for annexation from
all the property owners of the land. Except as provided for by an orderly annexation agreement,
this clause may not be used to annex any property contiguous to any property previously annexed
under this clause within the preceding 12 months if the property is owned by the same owners and
annexation would cumulatively exceed 120 acres; or
    (4) the land has been approved after August 1, 1995, by a preliminary plat or final plat for
subdivision to provide residential lots that average 21,780 square feet or less in area and the land
is located within two miles of the municipal limits.
    Subd. 2a.[Repealed, 1997 c 202 art 5 s 9]
    Subd. 2b. Notice, hearing required. Before a municipality may adopt an ordinance under
subdivision 2, clause (2), (3), or (4), a municipality must hold a public hearing and give 30 days'
written notice by certified mail to the town or towns affected by the proposed ordinance and to all
landowners within and contiguous to the area to be annexed.
    Subd. 3. 60 percent bordered and 40 acres or less. If the perimeter of the area to be annexed
by a municipality is 60 percent or more bordered by the municipality and if the area to be annexed
is 40 acres or less, the municipality shall serve notice of intent to annex upon the town board and
the director, unless the area is appropriate for annexation by ordinance under subdivision 2,
clause (3). The town board shall have 90 days from the date of service to serve objections with
the director. If no objections are forthcoming within the said 90-day period, such land may be
annexed by ordinance. If objections are filed with the director, the director shall conduct hearings
and issue an order as in the case of annexations under section 414.031, subdivisions 3 and 4.
    Subd. 4.[Repealed, 1978 c 705 s 33]
    Subd. 5. Petition by property owners; objections; procedure. If the land is platted, or, if
unplatted, does not exceed 200 acres, a majority of the property owners in number may petition
the municipal council to have such land included within the abutting municipality and, within
ten days thereafter, shall file copies of the petition with the director, the town board, the county
board and the municipal council of any other municipality which borders the land to be annexed.
Within 90 days from the date of service, the town board or the municipal council of such abutting
municipality may submit written objections to the annexation to the director and the annexing
municipality. Upon receipt of such objections, the director shall proceed to hold a hearing and
issue an order in accordance with section 414.031, subdivisions 3 and 4. If written objections are
not submitted within the time specified in this section and if the municipal council determines that
property proposed for the annexation is now or is about to become urban or suburban in character,
it may by ordinance declare such land annexed to the municipality. If the petition is not signed by
all the property owners of the land proposed to be annexed, the ordinance shall not be enacted
until the municipal council has held a hearing on the proposed annexation after at least 30 days'
mailed notice to all property owners within the area to be annexed.
    Subd. 6. If pending proceeding; waivers from parties. Whenever a proceeding for
annexation is initiated under this section and all or any part of the land is included in another
boundary adjustment proceeding pending before the director, no action thereon shall be taken by
the municipality, unless otherwise provided by an order of the director, until final disposition has
been made of the pending petition. Under this section, the director will accept a waiver from all
parties having a right to object, stating they have no objections to the proposed annexation and
waiving the 90 day period before an annexation ordinance may be adopted.
    Subd. 7. Filing; effective date; copy to auditors. Any annexation ordinance provided
for in this section must be filed with the director, the township, the county auditor and the
secretary of state and is final on the date the ordinance is approved by the director. A copy of the
annexation ordinance must be delivered immediately by the governing body of the municipality
to the appropriate county auditors.
    Subd. 8.[Repealed, 1980 c 487 s 23]
    Subd. 9.[Repealed, 1997 c 87 s 4]
    Subd. 10. Director may require additional information. The director may require the city
or property owners to furnish additional information concerning an annexation by ordinance to
inform the director about the extent to which the proposed annexation conforms to the statutory
criteria set forth in sections 414.01, subdivision 1, and 414.031, subdivision 4.
    Subd. 11. When annexed land is in floodplain or shoreland area. When a municipality
declares land annexed to the municipality under subdivision 2, clause (3), and the land is within a
designated floodplain, as provided by section 103F.111, subdivision 4, or a shoreland area, as
provided by section 103F.205, subdivision 4, the municipality shall adopt or amend its land
use controls to conform to chapter 103F, and any new development of the annexed land shall
be subject to chapter 103F.
    Subd. 12. Property taxes. When a municipality annexes land under subdivision 2, clause
(2), (3), or (4), property taxes payable on the annexed land shall continue to be paid to the affected
town or towns for the year in which the annexation becomes effective. If the annexation becomes
effective on or before August 1 of a levy year, the municipality may levy on the annexed area
beginning with that same levy year. If the annexation becomes effective after August 1 of a levy
year, the town may continue to levy on the annexed area for that levy year, and the municipality
may not levy on the annexed area until the following levy year.
    Subd. 13. Electric utility service notice; cost impact. At least 30 days before a municipality
may adopt an ordinance under subdivision 2, clause (2), (3), or (4), the petitioner must be notified
by the municipality that the cost of electric utility service to the petitioner may change if the land is
annexed to the municipality. The notice must include an estimate of the cost impact of any change
in electric utility services, including rate changes and assessments, resulting from the annexation.
History: 1969 c 1146 s 12; 1975 c 271 s 6; 1978 c 705 s 15-21; 1979 c 50 s 52; 1985 c 30 s
2,3; 1991 c 291 art 12 s 24; 1992 c 556 s 5-8; 1994 c 511 s 4-8; 1996 c 303 s 13,14; 1997 c 31 art
3 s 14,15; 1997 c 202 art 5 s 3-5; 2002 c 223 s 8-12; 2006 c 270 art 2 s 8,9; 2007 c 90 s 2,3,5
NOTE: The amendment to subdivision 2 by Laws 2006, chapter 270, article 2, section 8, is
effective until July 1, 2007. Laws 2006, chapter 270, article 2, section 8, the effective date.

414.0333 JOINT INFORMATIONAL MEETING.
There must be a joint informational meeting of the municipal council of the annexing
municipality and the town board of supervisors of the township containing the land proposed
to be annexed or included in annexation proceedings under section 414.031. For an annexation
under section 414.031, the joint informational meeting must be held after the final mediation
meeting or the final meeting held pursuant to section 414.01, subdivision 16, if any, and before
the hearing on the matter is held. If no mediation meetings are held, the joint informational
meeting must be held after the initiating documents have been filed and before the hearing on
the matter. The time, date, and place of the public informational meeting must be determined
jointly by the chair of the town board of supervisors and the mayor of the annexing municipality.
The chair of the town board of supervisors and the mayor must serve as the cochairs for the
informational meeting. Notice of the time, date, place, and purpose of the informational meeting
must be posted by the town clerk in the township's designated place for posting notices, and by
the municipal clerk in the municipality's designated place for posting notices. A joint notice shall
be published in a newspaper of general circulation within both the municipality and the township.
All notice required by this section must be provided at least ten days before the date for the public
informational meeting. At the public informational meeting, all persons appearing must have an
opportunity to be heard. The municipal council, the town board of supervisors, and any resident
or affected property owner may be represented by counsel and introduce evidence including, but
not limited to, expert testimony into the record of the informational meeting. The clerk of the
township must record minutes of the proceedings of the informational meeting and the municipal
clerk must make an audio recording of the informational meeting. The township must provide
the director and the municipality with a copy of the printed minutes and the municipality must
provide the director and the township with a copy of the audio recording. The record of the
informational meeting for a proceeding under section 414.031 is admissible in any proceeding
under this chapter and shall be taken into consideration by the director or the director's designee.
History: 2006 c 270 art 2 s 10

414.0335 IF PCA-ORDERED GOVERNMENTAL SERVICE EXTENSION.
    Subdivision 1. Annexation-by-ordinance alternative. If a determination or order by the
pollution control agency, under section 115.49 or other similar statute is made, that cooperation
by contract is necessary and feasible between a municipality and an unincorporated area located
outside the existing corporate limits of a municipality, the municipality required to provide or
extend through a contract a governmental service to an unincorporated area, during the statutory
90-day period provided in section 115.49 to formulate a contract, may in the alternative to
formulating a service contract to provide or extend the service, declare the unincorporated
area described in the Pollution Control Agency's determination letter or order annexed to the
municipality by adopting an ordinance and submitting it to the director.
    Subd. 2. Director's role. The director may review and comment on the ordinance but shall
approve the ordinance within 30 days of receipt. The ordinance is final and the annexation is
effective on the date the director approves the ordinance.
    Subd. 3. City to amend plan and controls. Thereafter, the city shall amend its
comprehensive plan and official controls in accordance with chapter 462.
History: 1997 c 202 art 5 s 6; 2002 c 223 s 13

414.034 [Repealed, 1978 c 705 s 33]

414.035 DIFFERENTIAL TAXATION FOR UP TO SIX YEARS.
Whenever an order, under section 414.031, 414.0325, or 414.033, annexes part or all of a
township to a municipality, the order may provide that the tax rate of the annexing municipality
on the area annexed shall be increased in substantially equal proportions over not more than six
years to equality with the tax rate on the property already within the municipality. The appropriate
period, if any, shall be based on the time reasonably required to effectively provide full municipal
services to the annexed area.
History: 1978 c 705 s 22; 1979 c 50 s 53; 1987 c 50 s 1; 1989 c 277 art 4 s 46; 2002
c 223 s 14

414.036 CITY REIMBURSEMENT TO TOWN TO ANNEX TAXABLE PROPERTY.
Unless otherwise agreed to by the annexing municipality and the affected town, when an
order or other approval under this chapter annexes part of a town to a municipality, the order or
other approval must provide a reimbursement from the municipality to the town for all or part
of the taxable property annexed as part of the order. The reimbursement shall be completed in
substantially equal payments over not less than two nor more than eight years from the time of
annexation. The municipality must reimburse the township for all special assessments assigned by
the township to the annexed property, and any portion of debt incurred by the town prior to the
annexation and attributable to the property to be annexed but for which no special assessments
are outstanding, in substantially equal payments over a period of not less than two or no more
than eight years.
History: 1981 c 189 s 1; 2002 c 223 s 15; 2006 c 270 art 2 s 11

414.038 EFFECT OF ANNEXATION ON TOWNSHIP ROADS.
Whenever a municipality annexes property abutting one side of a township road, the segment
of road abutting the annexed property must be treated as a line road and is subject to section
164.14. Whenever a municipality annexes the property on both sides of a township road, that
portion of road abutting the annexed property ceases to be a town road and becomes the obligation
of the annexing municipality. This section does not prohibit the annexing municipality from
contracting with the township for continued maintenance of the road. Any portion of a township
road that ceases to be a township road pursuant to this section may still be counted as a township
road for the road-and-bridge account revenues for the year in which the annexation occurs.
History: 1Sp2003 c 19 art 2 s 60

414.039 EFFECT OF ANNEXATION ON EASEMENTS.
If a municipality annexes property in which the affected township holds any easement for
the benefit of the public, the township's easement interest continues unless otherwise agreed
to by the township.
History: 1Sp2003 c 19 art 2 s 61

414.04 [Repealed, 1969 c 1146 s 20]

414.041 CONSOLIDATION OF MUNICIPALITIES.
    Subdivision 1. Initiating the proceeding. (a) Two or more municipalities may be the
subject of a single proceeding provided that each municipality abuts at least one of the included
municipalities.
(b) The proceeding shall be initiated in one of the following ways:
(1) submitting to the director a resolution of the city council of each affected municipality;
(2) submitting to the director a petition signed by a number of residents eligible to vote
equivalent to five percent or more of the resident voters of a municipality who voted for governor
at the last general election; or
(3) by the director.
(c) The petition or resolution shall set forth the following information about each included
municipality: name, description of boundaries, the reasons for requesting the consolidation and
the names of all parties entitled to mailed notice under section 414.09.
(d) The party initiating the proceeding shall serve copies of the petition or resolution on
all of the included municipalities.
    Subd. 2. Consolidation commission. Upon receipt of a petition or a resolution requesting
consolidation or upon the director's own motion, the director shall appoint a consolidation
commission from a list of ten candidates submitted by each affected city council. The commission
shall be composed of not fewer than five members from each affected municipality. From a
separate list of three persons submitted by each affected city council, the director shall appoint
a commission chair who is not a resident of an affected municipality but who resides in an
affected county.
No person is disqualified from serving on a consolidation commission by reason of holding
other elected or appointed office. Consolidation commission members shall hold office until a
consolidation report has been issued by the commission. The director shall fill vacancies in the
commission by appointment. The consolidation commission shall make rules with reference to
its operation and procedures including quorum requirements with reference to its operations
and procedures.
    Subd. 3. Commission's hearing and report. (a) The consolidation commission shall
conduct hearings regarding the proposed consolidation.
(b) The hearings shall include, but are not limited to, the following subjects:
(1) the contents of any city charter for the proposed consolidated city or the form of
government of the proposed consolidated city;
(2) analysis of whether a ward system shall be included in the form of government of the
proposed consolidated city; and
(3) each factor considered by the director under section 414.02, subdivision 3.
(c) Based on these factors and upon other matters which come before the consolidation
commission, the commission shall issue a report to the director with findings and recommendations
within two years from the date of the director's initial appointment of the commission.
    Subd. 4. Director's hearing and notice. Upon receipt of the commission's report, the
director shall designate a time and a place for a hearing in accordance with section 414.09.
    Subd. 5. Relevant factors, order. (a) In arriving at a decision, the director shall consider
the factors in section 414.02, subdivision 3.
(b) The director shall consider and may accept, amend, return to the commission for
amendment or further study, or reject the commission's findings and recommendations based upon
the director's written determination of what is in the best interests of the affected municipalities.
(c) The director shall order the consolidation on finding that consolidation will be for the
best interests of the municipalities. In all cases, the director shall set forth the factors which are
the basis for the decision.
(d) If the director orders consolidation, the order shall provide for election of new municipal
officers in accordance with section 414.09.
(e) If the most populous of the included municipalities is a statutory city, the new
municipality shall be a statutory city and the plan of government shall be Optional Plan A,
provided that an alternate plan may be adopted pursuant to section 412.551, at any time. If the
most populous of the included municipalities is a home rule charter city or organized under a
statute other than chapter 412, the new municipality shall be governed by its home rule charter
or the statutory form under which it is governed except that any ward system for the election of
council members shall be inoperable.
(f) If the commission's findings and recommendations include a proposed home rule charter
for the new municipality, the order may combine the issue of the adoption of the charter and the
vote on approval of the order for consolidation into one question on the ballot, and shall submit it
in a special or general election as provided in section 410.10.
(g) The ordinances of all of the included municipalities shall continue in effect within their
former boundaries until repealed by the governing body of the new municipality.
(h) Notwithstanding any other provision of law to the contrary, the order may establish a
ward system in the new municipality, in which event the order shall establish not less than three
nor more than seven wards, each of which shall elect one council member. When more than two
years have elapsed after consolidation, the governing body may, by a four-fifths vote, abolish
the ward system.
(i) The new municipality shall assume the name of the most populous municipality unless
previous to the election another name is chosen by joint resolution of a majority of the included
municipalities or by the consolidation commission.
(j) The number of license privileges existing in the included municipalities prior to
consolidation and pursuant to state law shall not be diminished as a result of the consolidation.
(k) If the consolidation is denied or defeated in a referendum, no proceeding for the
consolidation of the same municipalities may be initiated within two years from the date of
the order unless authorized by the director.
    Subd. 6. Final approval; petition; referenda. (a) If the consolidation was initiated by a
petition of the resident voters of a municipality, the order for consolidation shall be final upon
approval by resolution of the city councils in each of the affected municipalities unless ten percent
or more of the resident voters of an affected municipality who voted for governor at the last
general election petition the city council for a referendum on the consolidation. The petition must
be submitted within 90 days of the final date of the order or the date of final approval of the
order by the city councils, whichever is later.
(b) Upon receipt and verification of the petition, the director shall order the municipalities to
conduct separate referenda at a general or special election in each municipality on the same day,
and the referenda shall be held within six months of the receipt of the petition.
(c) Costs of the respective referenda shall be borne by the respective municipality. A majority
of those voting in each city must approve the proposed consolidation. The results of the referenda
shall be certified to the director by the chief election judge within ten days after the referenda. The
director shall upon receipt of the certificate notify all parties of the election results.
(d) If the consolidation was initiated by a city council resolution of each affected
municipality, the order for consolidation shall be final unless ten percent or more of the resident
voters of an affected municipality petition for a referendum as provided in paragraph (a).
(e) If the consolidation was initiated by the director, no director's consolidation order
involving existing municipalities shall become effective unless adopted by the council of each
affected municipality by a majority vote and unless the consolidation order is approved by the
qualified voters of the affected municipalities at a general or special election set according to
law. The form of the ballot shall be fixed by the director; and, if a majority of the votes cast on
the question in each municipality are in favor of its adoption, the order shall become effective
as provided herein.
(f) Notwithstanding a disapproval of the order for consolidation by a city council of
an affected municipality required to approve the order in paragraph (a) or (e), the order for
consolidation shall nevertheless be deemed approved by that city council if ten percent or more of
the resident voters of that municipality who voted for governor at the last general election petition
the city council for a referendum on the consolidation as provided in paragraph (a), and a majority
of those voting in that municipality approve the order for consolidation.
    Subd. 7. Differential taxation for up to five years. Where one municipality is receiving
substantially fewer municipal services, the director may provide that the tax rate of the
municipality shall be increased in substantially equal proportions over a period of not more than
five years to equality with the tax rate in the remainder of the new municipality. The period
shall be determined by the director on the basis of the period reasonably required to provide
substantially equal municipal services.
    Subd. 8. Effective date of consolidation. The consolidation shall be effective upon the
election and qualification of new municipal officers, or at such later date as set by the order.
History: 1969 c 1146 s 13; 1973 c 123 art 5 s 7; 1973 c 621 s 5; 1975 c 271 s 6; 1978 c
705 s 23; 1979 c 287 s 1; 1986 c 444; 1989 c 277 art 4 s 47; 1996 c 303 s 15,16; 2002 c 223 s
16; 2004 c 293 art 2 s 47

414.05 [Repealed, 1969 c 1146 s 20]

414.051 REVIEW OF TOWNSHIPS OF MORE THAN 2,000 POPULATION.
After each federal census the director may determine the townships which have a population
in excess of 2,000 exclusive of any municipality or part of a municipality within the township and
make recommendations which the director considers necessary and reasonable to the board of
any such township.
History: 1969 c 1146 s 14; 1975 c 271 s 6; 1981 c 357 s 106; 2002 c 223 s 17

414.06 DETACHMENT OF PROPERTY FROM A MUNICIPALITY.
    Subdivision 1. Initiating the proceeding. Property which is situated within a municipality
and abutting the municipal boundary, rural in character and not developed for urban residential,
commercial, or industrial purposes may be detached from the municipality according to the
following procedure. The proceeding may be initiated by submitting to the director a resolution of
the municipality to which the land is attached or by submitting to the director a petition of all of
the property owners of the land to be detached if the area is less than 40 acres or of 75 percent
of the property owners if over 40 acres. The petition or resolution shall set forth the boundaries
and the area of the land to be detached, the number and character of the buildings, the resident
population, and the municipal improvements, if any, in the area.
    Subd. 2. Hearing, if needed. If both a resolution of the municipality and a petition by all
the property owners are submitted, no hearing is necessary. In any other case, upon receipt of a
petition or resolution, the director shall designate a time and place for a hearing in accordance
with section 414.09.
    Subd. 3. Order. Upon completion of the hearing, the director may order the detachment
on finding that the requisite number of property owners have signed the petition if initiated
by the property owners, that the property is rural in character and not developed for urban
residential, commercial or industrial purposes, that the property is within the boundaries of the
municipality and abuts a boundary, that the detachment would not unreasonably affect the
symmetry of the detaching municipality, and that the land is not needed for reasonably anticipated
future development. The director may deny the detachment on finding that the remainder of the
municipality cannot continue to carry on the functions of government without undue hardship.
The director may decrease the area of property to be detached and may include only a part of the
proposed area to be detached. If the tract abuts more than one township, it shall become a part of
each township, being divided by projecting through it the boundary line between the townships.
The detached area may be relieved of the primary responsibility for existing indebtedness of the
municipality and be required to assume the indebtedness of the township of which it becomes a
part, in such proportion as the director shall deem just and equitable having in view the amount of
taxes due and delinquent and the indebtedness of each township and the municipality affected,
if any, and for what purpose the same was incurred, all in relation to the benefit inuring to the
detached area as a result of the indebtedness and the last net tax capacity of the taxable property
in each township and municipality.
    Subd. 4. Effective date of detachment. The detachment shall be effective upon the issuance
of the order, or at such later date, as provided by the order.
    Subd. 5. Copy to county auditors. A copy of the detachment order must be delivered
immediately by the director to the appropriate county auditors.
    Subd. 6. Timing of tax levy. For the purposes of taxation, if the detachment becomes
effective on or before August 1 of a levy year, the towns acquiring the detached area may levy on
it beginning with that same levy year. If the detachment becomes effective after August 1 of a
levy year, the municipality may continue to levy on the detached area for that levy year, and the
towns acquiring the detached area may not levy on it until the following levy year.
History: 1959 c 686 s 6; 1961 c 645 s 6; 1963 c 807 s 11; 1965 c 899 s 15; 1969 c 1146
s 15; 1975 c 271 s 6; 1978 c 705 s 24; 1988 c 719 art 5 s 84; 1989 c 329 art 13 s 20; 1991
c 291 art 12 s 25; 2002 c 223 s 18

414.061 INCORPORATED LAND; CONCURRENT DETACHMENT, ANNEXATION.
    Subdivision 1. Both municipalities may initiate the proceeding. Property of one
municipality which abuts another may be concurrently detached and annexed by the procedure set
forth in this section. The proceeding shall be initiated by submitting to the director resolutions of
both municipalities describing the land and stating their desire to detach and annex the land.
    Subd. 2. Order. If the resolutions are in order, the director may order the detachment and
annexation.
    Subd. 3. Effective date of order. The concurrent detachment and annexation shall be
effective upon the issuance of the order, or at such later date as provided by the order.
    Subd. 3a. Copy to county auditors. A copy of the annexation order must be delivered
immediately by the director to the appropriate county auditors.
    Subd. 3b. Timing of tax levies. For the purposes of taxation, if the annexation becomes
effective on or before August 1 of a levy year, the municipality acquiring the detached area
of another municipality may levy on it beginning with that same levy year. If the annexation
becomes effective after August 1 of a levy year, the municipality losing the detached area may
continue to levy on it for that levy year, and the municipality acquiring the detached area may
not levy on it until the following levy year.
    Subd. 4. Director's initiative. The director (1) may initiate proceedings for the concurrent
detachment and annexation of portions of one municipality completely surrounded by another
municipality, or (2) may act upon the petition of all of the owners of property in the completely
surrounded area. In such cases the director shall conduct hearings and issue an order pursuant to
section 414.09. In arriving at a decision, the director shall consider the factors in section 414.02,
subdivision 3 . The director shall order the proposed action on finding that it will be for the best
interests of the municipalities and the property owners. In all cases, the director shall set forth the
factors which are the basis for the decision.
    Subd. 4a.[Repealed, 1996 c 303 s 19]
    Subd. 5. Property owners may initiate. Property owners may initiate proceedings for the
concurrent detachment of their property from one municipality and its annexation to an adjacent
municipality by a petition signed by all of them that they submit to the director accompanied by a
resolution of the city council of each of the affected municipalities. The director shall conduct
hearings and issue an order pursuant to section 414.09. In arriving at a decision, the director shall
consider the factors in section 414.02, subdivision 3. The director shall order the proposed action
on finding that it will be for the best interests of the municipalities and the property owner. In all
cases, the director shall set forth the factors which are the basis for the decision.
History: 1969 c 1146 s 16; 1973 c 621 s 6; 1975 c 271 s 6; 1978 c 705 s 25-27; 1985 c 30 s
4; 1Sp1986 c 3 art 1 s 53-55; 1991 c 291 art 12 s 26; 1994 c 511 s 9; 1996 c 303 s 17,18; 2002
c 223 s 19; 2006 c 270 art 2 s 12

414.063 PART OF JOINT AGREEMENTS MAY BE PUT IN ORDERS.
After notice and hearing as provided in section 414.09, the director may include provisions
of joint agreements between political subdivisions in the orders.
History: 1978 c 705 s 28; 2002 c 223 s 20

414.065 IF STATE IS FEE OWNER OF PROPOSED BOUNDARY ADJUSTMENT LAND.
In any case in which the state is the fee owner of land partly or wholly within any area
proposed to be part of a boundary adjustment, the executive council of the state of Minnesota may
petition for, or consent to, any action proceeding under this chapter, if the council deems such
action to be in the best interests of the state.
History: 1965 c 899 s 16; 1978 c 705 s 29

414.067 APPORTIONED ASSETS AND OBLIGATIONS.
    Subdivision 1. Township or municipality divided. Whenever the director divides an
existing governmental unit, the director may apportion the property and obligations between
the governmental unit adding territory and the governmental unit from which the territory was
obtained. The apportionment shall be made in a just and equitable manner having in view the
value of the existing township or municipal property located in the area to be added, the assets,
value, and location of all the taxable property in the existing township or municipality, the
indebtedness, the taxes due and delinquent, other revenue accrued but not paid to the existing
township or municipality and the ability of any remainder of the township or municipality to
function as an effective governmental unit. The order shall not relieve any property from any tax
liability for payment for any bonded obligation, but the taxable property in the new municipality
may be made primarily liable thereon.
    Subd. 2. Entire town or consolidated cities. When an entire township is annexed by
an existing municipality, or an entire township is incorporated into a new municipality, or a
municipality is consolidated into a new municipality, all money, claims, or properties, including
real estate owned, held, or possessed by the annexed, incorporated township or municipality, and
any proceeds or taxes levied by such town or municipality, collected or uncollected, shall become
and be the property of the new or annexing municipality with full power and authority to use and
dispose of the same for public purposes as the council or new annexing municipality may deem
best, subject to the rights of creditors. Any taxes levied to pay bonded indebtedness of a town or
former municipality annexed to an existing municipality or incorporated or consolidated into a
new municipality shall be borne only by that taxable property within the boundaries of the former
town or municipality, provided, however, the units of government concerned may by resolution of
their governing bodies agree that taxes levied to pay the indebtedness must be levied upon all
taxable property within the boundaries of the new municipality. Notwithstanding that the bonded
indebtedness may be payable from taxes levied on only a portion of the taxable property in the
new or surviving municipality, the full faith and credit of the new or surviving municipality must
secure any outstanding bonded indebtedness to which the full faith and credit of the annexed or
consolidated township or municipality was pledged. If any general funds of the new or surviving
municipality are used to pay debt service on the bonded indebtedness, the general funds must
be reimbursed, with or without interest, from taxes levied on taxable property in the former
township or municipality.
    Subd. 3. Revision of tax records; redistribution of levies. In an apportionment made
under this section, the director may order the county auditor to revise tax records and respread
levies at any time prior to December 15 or order the county treasurer to redistribute taxes levied
and receivable.
History: 1969 c 1146 s 17; 1971 c 62 s 1; 1973 c 621 s 7; 1975 c 271 s 6; 1978 c 705 s 30;
1997 c 219 s 4; 2002 c 223 s 21,22

414.068 [Repealed, 1978 c 705 s 33]

414.07 APPEALS.
    Subdivision 1. Orders, time limit. All orders in proceedings under this chapter shall be
issued within one year from the date of the day of the first hearing thereon provided that the time
may be extended for a fixed additional period upon consent of all parties of record. Failure to
so order shall be deemed to be an order denying the matter. An appeal may be taken from such
failure to so order in the same manner as an appeal from an order as provided in subdivision 2.
    Subd. 2. Grounds for appeal. (a) Any person aggrieved by any order issued under this
chapter may appeal to the district court upon the following grounds:
(1) that the order was issued without jurisdiction to act;
(2) that the order exceeded the orderer's jurisdiction;
(3) that the order is arbitrary, fraudulent, capricious or oppressive or in unreasonable
disregard of the best interests of the territory affected; or
(4) that the order is based upon an erroneous theory of law.
(b) The appeal shall be taken in the district court in the county in which the majority of the
area affected is located. The appeal shall not stay the effect of the order. All notices and other
documents shall be served on both the director and the attorney general's assistant assigned
to the director for purposes of this chapter.
(c) If the court determines that the action involved is unlawful or unreasonable or is not
warranted by the evidence in case an issue of fact is involved, the court may vacate or suspend
the action involved, in whole or in part, as the case requires. The matter shall then be remanded
for further action in conformity with the decision of the court.
(d) To render a review of an order effectual, the aggrieved person shall file with the court
administrator of the district court of the county in which the majority of the area is located,
within 30 days of the order, an application for review together with the grounds upon which
the review is sought.
(e) An appeal lies from the district court as in other civil cases.
History: 1959 c 686 s 7; 1961 c 645 s 7; 1969 c 1146 s 18; 1975 c 271 s 6; 1976 c 239 s 42;
1978 c 705 s 31; 1983 c 247 s 150; 1Sp1986 c 3 art 1 s 82; 1994 c 511 s 10; 2002 c 223 s 23

414.08 DIRECTOR MAY APPEAL FROM DISTRICT COURT.
An appeal may be taken under the Rules of Civil Appellate Procedure by the director from a
final order or judgment made or rendered by the district court when the director determines that
the final order or judgment adversely affects the public interest.
History: 1965 c 834 s 1; 1975 c 271 s 6; 1976 c 239 s 43; 1983 c 247 s 151; 2002 c 223 s 24

414.09 UNIFORM PROCEDURES.
    Subdivision 1. Hearings. (a) Proceedings initiated by the submission of an initiating
document or by the director shall come on for hearing within 30 to 60 days from receipt of the
document by the director or from the date of the director's action and the person conducting the
hearing must submit an order no later than one year from the date of the day of the first hearing.
(b) The place of the hearing shall be in the county where a majority of the affected territory
is situated, and shall be established for the convenience of the parties.
(c) The director shall mail notice of the hearing to the following parties: the township or
municipality presently governing the affected territory; any township or municipality abutting the
affected territory; the county where the affected territory is situated; and each planning agency
which has jurisdiction over the affected area.
(d) The director shall see that notice of the hearing is published for two successive weeks in
a legal newspaper of general circulation in the affected area.
(e) When the director exercises authority to change the boundaries of the affected area so as
to increase the quantity of the land, the hearing shall be recessed and reconvened upon two weeks'
published notice in a legal newspaper of general circulation in the affected area.
    Subd. 2. Transmittal of order. The director shall see that copies of the order are mailed
to all parties entitled to mailed notice of hearing under subdivision 1, the secretary of state, the
Department of Revenue, the state demographer, individual property owners if initiated in that
manner, affected county auditor, and any other party of record. The affected county auditor shall
record the order against the affected property.
    Subd. 3. Elections of municipal officers. (a) An order approving an incorporation or
consolidation pursuant to this chapter, or an order requiring an election under section 414.031,
subdivision 4a , shall set a date for an election of new municipal officers not less than 45 days nor
more than 60 days after the issuance of such order.
(b) The director shall appoint an acting clerk for election purposes, at least three election
judges who shall be residents of the new municipality, and shall designate polling places within
the new municipality.
(c) The acting clerk shall prepare the official election ballot.
(d) Any person eligible to hold municipal office may file an affidavit of candidacy not more
than four weeks nor less than two weeks before the date designated in the order for the election.
(e) The election shall be conducted in conformity with the charter and the laws for
conducting municipal elections insofar as applicable.
(f) Any person eligible to vote at a township or municipal election within the area of the new
municipality, is eligible to vote at such election.
(g) Any excess in the expense of conducting the election over receipts from filing fees
shall be a charge against the new municipality; any excess of receipts shall be deposited in the
treasury of the new municipality.
History: 1969 c 1146 s 19; 1973 c 123 art 5 s 7; 1975 c 271 s 6; 1976 c 44 s 31; 1978 c 705
s 32; 1984 c 543 s 48; 1994 c 511 s 11,12; 2002 c 223 s 25; 2002 c 235 s 2; 2003 c 2 art 5 s 10,17

414.10 [Repealed, 2000 c 446 s 4]

414.11 [Repealed, 2002 c 223 s 29]

414.12 DIRECTOR'S POWERS.
    Subdivision 1. Alternative dispute resolution. (a) Notwithstanding anything to the contrary
in sections 414.01 to 414.09, the director, upon consultation with affected parties and considering
the procedures and principles established in sections 414.01 to 414.09, and Laws 1997, chapter
202, article 4, sections 1 to 13, may require that disputes over proposed boundary adjustments
be resolved by means of alternative dispute resolution processes in place of hearings that would
otherwise be required pursuant to sections 414.01 to 414.09, including those provided in chapter
14, in the execution of the director's duties under this chapter.
(b) Alternative dispute resolution processes that may be required include:
(1) the contested case procedures provided by sections 14.57 to 14.62;
(2) the mediation and arbitration process provided by sections 572A.015 to 572A.03; or
(3) another mediation and arbitration process ordered by the director.
    Subd. 2. Delegation of authority. (a) The director may, with the agreement of the chief
administrative law judge, delegate to the office of administrative hearings, in any individual case
or group of cases, the director's authority and responsibility to conduct hearings and issue final
orders related to the hearings under sections 414.01 to 414.09.
(b) In the case of detachment of lands from a municipality, if the parties do not agree to
resolve a boundary adjustment matter by mediation or arbitration, then the case shall be referred
to an administrative law judge to conduct hearings and issue final orders related to the hearings
under sections 414.01 to 414.09.
    Subd. 3. Cost of proceedings. (a) The parties to any matter directed to alternative dispute
resolution under subdivision 1 or delegated to the Office of Administrative Hearings under
subdivision 2 must pay the costs of the alternative dispute resolution process or hearing in the
proportions that they agree to.
(b) Notwithstanding section 14.53 or other law, the office of strategic and long-range
planning is not liable for the costs.
(c) If the parties do not agree to a division of the costs before the commencement of
mediation, arbitration, or hearing, the costs must be allocated on an equitable basis by the
mediator, arbitrator, or chief administrative law judge.
(d) The chief administrative law judge may contract with the parties to a matter directed or
delegated to the Office of Administrative Hearings under subdivisions 1 and 2 for the purpose of
providing administrative law judges and reporters for an administrative proceeding or alternative
dispute resolution.
(e) The chief administrative law judge shall assess the cost of services rendered as provided
by section 14.53.
    Subd. 4. Parties. In this section, "party" means:
(1) a property owner, group of property owners, municipality, or township that files an
initiating document or timely objection under this chapter;
(2) the municipality or township within which the subject area is located;
(3) a municipality abutting the subject area; and
(4) any other person, group of persons, or governmental agency residing in, owning property
in, or exercising jurisdiction over the subject area that files with the director a notice of appearance
within 14 days of publication of the notice required by section 414.09.
History: 1999 c 243 art 16 s 25; 2000 c 446 s 1; 2002 c 223 s 26,27