H.F. 2175 Section 1. Section 9.2, Code 2009, is amended to read as 1 follows: 2 9.2 Records relating to cities. 3 The secretary of state shall receive and preserve in the 4 secretary’s office all papers transmitted to the secretary 5 in relation to city development, including incorporation, 6 discontinuance, annexation, or boundary adjustment; and shall 7 keep an alphabetical list of cities in a book provided for 8 that purpose, in which shall be entered the name of the city, 9 the county in which situated, and the date of incorporation, 10 discontinuance, annexation, or boundary adjustment. 11 Sec. 2. Section 368.1, subsection 4, Code 2009, is amended 12 to read as follows: 13 4. “Boundary adjustment” means annexation, severance or 14 consolidation. 15 Sec. 3. Section 368.6, Code 2009, is amended to read as 16 follows: 17 368.6 Intent. 18 It is the intent of the general assembly to provide an 19 annexation approval procedure which gives due consideration to 20 the wishes of the residents of territory to be annexed, and to 21 the interests of the residents of all territories affected by 22 an annexation. The general assembly presumes that a voluntary 23 annexation of territory more most closely reflects the wishes 24 of the residents each resident of territory to be annexed, 25 and, therefore, intends that the annexation approval procedure 26 include a presumption of validity for voluntary annexation 27 approval. 28 Sec. 4. Section 368.7, subsection 1, Code 2009, is amended 29 by striking the subsection and inserting in lieu thereof the 30 following: 31 1. All of the owners of land in a territory adjoining a 32 city may apply in writing to the council of the adjoining city 33 requesting annexation of the territory. An owner’s land shall 34 not be included in the territory to be annexed, unless the 35 -1- LSB 6075HH (4) 83 md/sc 1/ 10

H.F. 2175 landowner has joined in the application to the council. 1 Sec. 5. Section 368.7, subsection 4, Code 2009, is amended 2 by striking the subsection. 3 Sec. 6. Section 368.7, subsection 5, Code 2009, is amended 4 to read as follows: 5 5. In the discretion of a city council, the resolution 6 provided for in subsection 1 , paragraph “d” , or subsection 2 or 7 3, may include a provision for a transition for the imposition 8 of city taxes against property within the annexation area as 9 provided in section 368.11, subsection 3 , paragraph “m” . The 10 provision shall allow for an exemption from taxation of the 11 following percentages of assessed valuation according to the 12 following schedule: 13 a. For the first and second years, seventy-five percent. 14 b. For the third and fourth years, sixty percent. 15 c. For the fifth and sixth years, forty-five percent. 16 d. For the seventh and eighth years, thirty percent. 17 e. For the ninth and tenth years, fifteen percent. 18 An alternative schedule may be adopted by the city council. 19 However, an alternative schedule shall not allow a greater 20 exemption than that provided in this subsection. The exemption 21 shall be applied in the levy and collection of taxes. The 22 provision may also allow for the partial provision of city 23 services during the time in which the exemption from taxation 24 is in effect. If the city council provides for a transition 25 for the imposition of city taxes against property in an 26 annexation area, all property owners included in the annexation 27 area must receive the transition upon completion of the 28 annexation. 29 Sec. 7. Section 368.11, subsection 1, Code 2009, is amended 30 to read as follows: 31 1. A petition for incorporation, discontinuance, or 32 boundary adjustment may be filed with the board by a city 33 council, a county board of supervisors, a regional planning 34 authority, or five percent of the registered voters of a city 35 -2- LSB 6075HH (4) 83 md/sc 2/ 10

H.F. 2175 or territory involved in the proposal. Notice of the filing, 1 including a copy of the petition, must be served upon the 2 council of each city for which a discontinuance or boundary 3 adjustment is proposed, the board of supervisors for each 4 county which contains a portion of a city to be discontinued or 5 territory to be incorporated , annexed or severed, the council 6 of a city if an incorporation includes territory within the 7 city’s urbanized area, and any regional planning authority for 8 the area involved. 9 Sec. 8. Section 368.11, subsection 3, paragraph j, Code 10 2009, is amended to read as follows: 11 j. In a case of annexation or incorporation, the petition 12 must state that none of the territory is within a city. 13 Sec. 9. Section 368.11, subsection 3, paragraphs m and n, 14 Code 2009, are amended by striking the paragraphs. 15 Sec. 10. Section 368.11, subsections 4 through 6, Code 2009, 16 are amended by striking the subsections. 17 Sec. 11. Section 368.12, Code 2009, is amended to read as 18 follows: 19 368.12 Dismissal. 20 The board may dismiss a petition only if it finds that the 21 petition does not meet the requirements of this chapter, or 22 that substantially the same incorporation, discontinuance, or 23 boundary adjustment has been disapproved by a committee formed 24 to consider the proposal, or by the voters, within the two 25 years prior to the date the petition is filed with the board , 26 or that the territory to be annexed, or a portion of that 27 territory, has been voluntarily annexed under section 368.7 . 28 The board shall file for record a statement of each dismissal 29 and the reason for it, and shall promptly notify the parties to 30 the proceeding of its decision. 31 Sec. 12. Section 368.14, unnumbered paragraph 1, Code 2009, 32 is amended to read as follows: 33 If an involuntary a petition filed under section 368.11 is 34 not dismissed, the board shall direct the appointment of local 35 -3- LSB 6075HH (4) 83 md/sc 3/ 10

H.F. 2175 representatives to serve with board members as a committee 1 to consider the proposal. Each local representative is 2 entitled to receive from the state the representative’s actual 3 and necessary expenses spent in performance of committee 4 duties. Three board members and one local representative, 5 or if the number of local representatives exceeds one, three 6 board members and at least one-half of the appointed local 7 representatives, are required for a quorum of the committee. 8 A local representative must be a registered voter of the 9 territory or city which the representative represents, and must 10 be selected as follows: 11 Sec. 13. Section 368.14, subsections 3 and 4, Code 2009, are 12 amended to read as follows: 13 3. From a territory to be annexed to or severed from a 14 city, one representative appointed by the county board of 15 supervisors. If there are no registered voters residing in 16 an area to be annexed to or severed from a city, the county 17 board of supervisors shall appoint as local representative an 18 individual owning property in the territory whether or not the 19 individual is a registered voter or appoint a designee of such 20 individual. If the territory is in more than one county, the 21 board shall direct the appointment of a local representative 22 from each county involved by its board of supervisors. 23 4. From a city to which territory is to be annexed or from 24 which territory is to be severed, one representative appointed 25 by the city council. If the territory is in more than one 26 county, the board shall direct the appointment of an equal 27 number of city and county local representatives. 28 Sec. 14. Section 368.14A, Code 2009, is amended to read as 29 follows: 30 368.14A Special local committees. 31 When two or more petitions for city development action 32 or applications for voluntary annexation describing common 33 territory are being considered together, the board shall 34 direct the appointment of representatives for each of the 35 -4- LSB 6075HH (4) 83 md/sc 4/ 10

H.F. 2175 petitions to serve on one special committee to consider the 1 petitions. Expense reimbursement and qualifications of these 2 representatives shall be as provided in section 368.14. Three 3 board members and at least one-half of the appointed local 4 representatives are required for a quorum of the special local 5 committee. The manner of appointment of representatives shall 6 be the same as for single petition committees as provided in 7 section 368.14. The special committee shall consider the 8 petitions in conformity with the provisions of this chapter, 9 and shall resolve common territory issues between petitioners. 10 The special committee shall conduct a public hearing on the 11 petitions pursuant to section 368.15. If the common territory 12 issue is resolved, the special local committee may approve the 13 resulting compatible petitions by a single vote or separately, 14 in its discretion. 15 Sec. 15. Section 368.15, Code 2009, is amended to read as 16 follows: 17 368.15 Public hearing. 18 The committee shall conduct a public hearing on a proposal 19 as soon as practicable. Notice of the hearing must be served 20 upon the council of each city for which a discontinuance 21 or boundary adjustment is proposed, the county board of 22 supervisors for each county which contains a portion of a 23 city to be discontinued or territory to be incorporated , 24 annexed, or severed, and any regional planning authority for 25 the area involved. A notice of the hearing, which includes a 26 brief description of the proposal and a statement of where the 27 petition or plan is available for public inspection, must be 28 published as provided in section 362.3, except that there must 29 be two publications in a newspaper having general circulation 30 in each city and each territory involved in the proposal. 31 Any person may submit written briefs, and in the committee’s 32 discretion, may be heard on the proposal. The board may 33 subpoena witnesses and documents relevant to the proposal. 34 Sec. 16. Section 368.17, Code 2009, is amended to read as 35 -5- LSB 6075HH (4) 83 md/sc 5/ 10

H.F. 2175 follows: 1 368.17 When approval barred. 2 The committee may not approve: 3 1. An incorporation unless it finds that the city to be 4 incorporated will be able to provide customary municipal 5 services within a reasonable time. 6 2. A discontinuance or severance if the city to be 7 discontinued or the territory to be severed will be surrounded 8 by one or more cities unless a petition an application for 9 annexation of the same area is also filed and approved pursuant 10 to section 368.7 . 11 3. A discontinuance or severance unless it finds that 12 the county or another city will be able to provide necessary 13 municipal services to the residents. 14 4. An annexation unless the territory is adjoining the 15 city to which it will be annexed, and the committee finds that 16 the city will be able to provide to the territory substantial 17 municipal services and benefits not previously enjoyed by such 18 territory, and that the motive for annexation is not solely to 19 increase revenues to the city. 20 5. 4. A consolidation unless the cities are contiguous. 21 6. 5. An incorporation of territory, any part of 22 which is within two miles of an existing city, unless a 23 petition an application for annexation of substantially the 24 same territory to such city under section 368.7 has been 25 dismissed, disapproved , or voted upon unfavorably by the city 26 council of the existing city or by the board within the last 27 five years. 28 7. 6. A city development action which creates an island. 29 Sec. 17. Section 368.19, subsections 1 and 2, Code 30 Supplement 2009, are amended to read as follows: 31 1. The committee shall approve or disapprove the petition 32 or plan as amended, within ninety days of the final hearing, 33 and shall file its decision for record and promptly notify the 34 parties to the proceeding of its decision. If a petition or 35 -6- LSB 6075HH (4) 83 md/sc 6/ 10

H.F. 2175 plan is approved, the board shall submit the proposal at an 1 election held on a date specified in section 39.2, subsection 2 4, paragraph “a” or “b” , whichever is applicable, and the county 3 commissioner of elections shall conduct the election. In a 4 case of incorporation or discontinuance, registered voters of 5 the territory or city may vote, and the proposal is authorized 6 if a majority of those voting approves it. In a case of 7 annexation or severance, registered voters of the territory 8 and of the city may vote, and the proposal is authorized if a 9 majority of the total number of persons voting approves it. In 10 a case of consolidation, registered voters of each city to be 11 consolidated may vote, and the proposal is authorized only if 12 it receives a favorable majority vote in each city. The county 13 commissioner of elections shall publish notice of the election 14 as provided in section 49.53 and shall conduct the election in 15 the same manner as other special elections. 16 2. The city shall provide to the commissioner of 17 elections a map of the area to be incorporated, discontinued, 18 annexed, severed, or consolidated, which must be approved by 19 the commissioner as suitable for posting. The map shall be 20 displayed prominently in at least one place within the voting 21 precinct, and inside each voting booth. 22 Sec. 18. Section 368.20, Code 2009, is amended to read as 23 follows: 24 368.20 Procedure after approval. 25 1. After the county commissioner of elections has certified 26 the results to the board, the board shall: 27 1. a. Serve and publish notice of the result as provided 28 in section 362.3. 29 2. b. File with the secretary of state and the clerk of 30 each city incorporated or involved in a boundary adjustment, 31 and record with the recorder of each county which contains 32 a portion of any city or territory involved, copies of the 33 proceedings including the original petition or plan and any 34 amendments, the order of the board approving the petition 35 -7- LSB 6075HH (4) 83 md/sc 7/ 10

H.F. 2175 or plan, proofs of service and publication of required 1 notices, certification of the election result, and any other 2 material deemed by the board to be of primary importance to 3 the proceedings. Upon proper filing and expiration of time 4 for appeal, the incorporation, discontinuance, or boundary 5 adjustment is complete. However, if an appeal to any of 6 the proceedings is pending, completion does not occur until 7 the appeal is decided, unless a subsequent date is provided 8 in the proposal. The board shall also file with the state 9 department of transportation a copy of the map and legal land 10 description of each completed incorporation or corporate 11 boundary adjustment completed under sections 368.11 through 12 368.22 or approved annexation within an urbanized area. 13 2. After approving an application for annexation described 14 in section 368.7, subsection 3, the board shall file with the 15 secretary of state and the clerk of each city involved in the 16 annexation, and record with the recorder of each county which 17 contains a portion of any city or territory involved, copies 18 of the proceedings including the original application and any 19 amendments, the order of the board approving the application, 20 proofs of service and publication of required notices, and any 21 other material deemed by the board to be of primary importance 22 to the proceedings. Upon proper filing and expiration of time 23 for appeal, the annexation is complete. However, if an appeal 24 to any of the proceedings is pending, completion does not 25 occur until the appeal is decided, unless a subsequent date is 26 provided in the application. The board shall also file with 27 the state department of transportation a copy of the map and 28 legal land description of each completed annexation. 29 Sec. 19. Section 368.21, Code 2009, is amended to read as 30 follows: 31 368.21 Supervision of procedures. 32 When an incorporation, discontinuance, annexation, or 33 boundary adjustment is complete, the board shall supervise 34 procedures necessary to carry out the proposal. In the case of 35 -8- LSB 6075HH (4) 83 md/sc 8/ 10

H.F. 2175 an incorporation, the county commissioner of elections shall 1 conduct an election for mayor and council of the city, who 2 shall serve until their successors take office following the 3 next regular city election. In the case of a discontinuance, 4 the board shall publish two notices as provided in section 5 368.15 that it will receive and adjudicate claims against the 6 discontinued city for a period of six months from the date 7 of last notice, and shall cause necessary taxes to be levied 8 against the property within the discontinued city to pay 9 claims allowed. All records of a discontinued city shall be 10 deposited with the county auditor of the county designated by 11 the board. Any remaining balances shall be deposited in the 12 county treasury where the former city was located. In the 13 case of a boundary adjustments adjustment or annexation , the 14 proper city officials shall carry out procedures necessary to 15 implement the proposal. 16 Sec. 20. Section 368.25, Code 2009, is amended by striking 17 the section and inserting in lieu thereof the following: 18 368.25 Failure to provide municipal services. 19 1. A landowner within the boundaries of a city may file 20 a petition for severance with the city development board if 21 the petitioner’s land, following annexation under section 22 368.7, has not been provided municipal services for a period 23 of three years, or the city has failed to show substantial and 24 continuing progress in the provision of municipal services. 25 2. Upon the receipt of a petition under subsection 1, the 26 city development board may initiate proceedings to sever the 27 annexed territory from the city. The board shall notify the 28 city of the severance proceedings and shall hold a public 29 hearing on the proposed severance. The board shall give notice 30 of the hearing in the same manner as notice of a public meeting 31 in section 368.11. 32 3. The board may order severance of all or a portion of the 33 territory and the order to sever is not subject to approval at 34 an election. A city may request that the board allow up to an 35 -9- LSB 6075HH (4) 83 md/sc 9/ 10

H.F. 2175 additional three years to provide municipal services if good 1 cause is shown. 2 4. As an alternative to severance of the territory, the 3 board may impose a moratorium on additional annexation by 4 the city until the city complies with its plan for extending 5 municipal services. 6 EXPLANATION 7 This bill relates to the authority of a city to annex 8 territory. 9 Current Code section 368.7 relating to voluntary annexation 10 allows an application for annexation to include up to 20 11 percent of the land area in the proposed annexation territory 12 without consent of the landowner. The bill amends Code section 13 368.7 by specifying that a landowner’s property may not be 14 included in the territory to be annexed unless the landowner 15 has joined in the application to the city council. 16 The bill eliminates the involuntary annexation procedure in 17 Code section 368.11 by removing annexation from the definition 18 of “boundary adjustment”. The bill removes references to 19 annexation within Code section 368.11 and removes procedures 20 and requirements in Code section 368.11 which only apply to 21 annexation. 22 The bill strikes Code section 368.25, relating to a city’s 23 failure to provide municipal services to territory within an 24 annexed area and inserts provisions which allow a landowner to 25 petition the city development board for severance if the city 26 has not provided municipal services within three years of a 27 voluntary annexation under Code section 368.7. 28 The bill removes references to nonconsenting landowners and 29 involuntary annexation as it relates to annexation by cities 30 throughout Code chapter 368. 31 -10- LSB 6075HH (4) 83 md/sc 10/ 10