1.1                          A bill for an act 
  1.2             relating to local government; limiting annexation by 
  1.3             ordinance; amending Minnesota Statutes 1998, section 
  1.4             414.033, subdivisions 2, 2b, 3, and 12; repealing 
  1.5             Minnesota Statutes 1998, section 414.033, subdivision 
  1.6             11. 
  1.7   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.8      Section 1.  Minnesota Statutes 1998, section 414.033, 
  1.9   subdivision 2, is amended to read: 
  1.10     Subd. 2.  [CONDITIONS.] A municipal council may by 
  1.11  ordinance declare land annexed to the municipality and any such 
  1.12  land is deemed to be urban or suburban in character or about to 
  1.13  become so if: 
  1.14     (1) the land is owned by the municipality; 
  1.15     (2) the land is completely surrounded by land within the 
  1.16  municipal limits; 
  1.17     (3) ~~the land abuts the municipality and the area to be~~ 
  1.18  ~~annexed is 60 acres or less, and the area to be annexed is not~~ 
  1.19  ~~presently served by public sewer facilities or public sewer~~ 
  1.20  ~~facilities are not otherwise available, and the municipality~~ 
  1.21  ~~receives a petition for annexation from all the property owners~~ 
  1.22  ~~of the land; or~~ 
  1.23     ~~(4)~~ the land has been approved after August 1, 1995, by a 
  1.24  preliminary plat or final plat for subdivision to provide 
  1.25  residential lots that average 21,780 square feet or less in area 
  1.26  and the land is located within two miles of the municipal limits.
  2.1      Sec. 2.  Minnesota Statutes 1998, section 414.033, 
  2.2   subdivision 2b, is amended to read: 
  2.3      Subd. 2b.  [NOTICE REQUIRED.] Before a municipality may 
  2.4   adopt an ordinance under subdivision 2, clause (2)~~,~~ or (3), ~~or~~ 
  2.5   ~~(4),~~ a municipality must hold a public hearing and give 30 days' 
  2.6   written notice by certified mail to the town or towns affected 
  2.7   by the proposed ordinance and to all landowners within and 
  2.8   contiguous to the area to be annexed.  
  2.9      Sec. 3.  Minnesota Statutes 1998, section 414.033, 
  2.10  subdivision 3, is amended to read: 
  2.11     Subd. 3.  [PERIMETER, ACREAGE REQUIREMENTS.] If the 
  2.12  perimeter of the area to be annexed by a municipality is 60 
  2.13  percent or more bordered by the municipality and if the area to 
  2.14  be annexed is 40 acres or less, the municipality shall serve 
  2.15  notice of intent to annex upon the town board and the municipal 
  2.16  board~~, unless the area is appropriate for annexation by~~ 
  2.17  ~~ordinance under subdivision 2, clause (3)~~.  The town board shall 
  2.18  have 90 days from the date of service to serve objections with 
  2.19  the board.  If no objections are forthcoming within the said 90 
  2.20  day period, such land may be annexed by ordinance.  If 
  2.21  objections are filed with the board, the board shall conduct 
  2.22  hearings and issue its order as in the case of annexations under 
  2.23  section 414.031, subdivisions 3 and 4. 
  2.24     Sec. 4.  Minnesota Statutes 1998, section 414.033, 
  2.25  subdivision 12, is amended to read: 
  2.26     Subd. 12.  [PROPERTY TAXES.] When a municipality annexes 
  2.27  land under subdivision 2, clause (2)~~,~~ or (3)~~, or (4)~~, property 
  2.28  taxes payable on the annexed land shall continue to be paid to 
  2.29  the affected town or towns for the year in which the annexation 
  2.30  becomes effective.  If the annexation becomes effective on or 
  2.31  before August 1 of a levy year, the municipality may levy on the 
  2.32  annexed area beginning with that same levy year.  If the 
  2.33  annexation becomes effective after August 1 of a levy year, the 
  2.34  town may continue to levy on the annexed area for that levy 
  2.35  year, and the municipality may not levy on the annexed area 
  2.36  until the following levy year.  In the first year following the 
  3.1   year when the municipality could first levy on the annexed area 
  3.2   under this subdivision, and thereafter, property taxes on the 
  3.3   annexed land shall be paid to the municipality.  In the first 
  3.4   year following the year the municipality could first levy on the 
  3.5   annexed area, the municipality shall make a cash payment to the 
  3.6   affected town or towns in an amount equal to 90 percent of the 
  3.7   property taxes distributed to the town in regard to the annexed 
  3.8   area in the last year the property taxes from the annexed area 
  3.9   were payable to the town; in the second year, an amount equal to 
  3.10  70 percent; in the third year, an amount equal to 50 percent; in 
  3.11  the fourth year, an amount equal to 30 percent; and in the fifth 
  3.12  year, an amount equal to ten percent.  The municipality and the 
  3.13  affected township may agree to a different payment. 
  3.14     Sec. 5.  [REPEALER.] 
  3.15     Minnesota Statutes 1998, section 414.033, subdivision 11, 
  3.16  is repealed.