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S.B. 23

             1     

SPECIAL DISTRICT AND LOCAL DISTRICT

             2     
AMENDMENTS

             3     
2001 GENERAL SESSION

             4     
STATE OF UTAH

             5     
Sponsor: David L. Gladwell

             6      This act modifies provisions relating to Special Districts and Limited Purpose Local
             7      Government Entities to rewrite and standardize annexation, withdrawal, and dissolution
             8      provisions for specified special districts and for local districts. The act repeals inconsistent
             9      and obsolete provisions and makes technical changes.
             10      This act affects sections of Utah Code Annotated 1953 as follows:
             11      ENACTS:
             12          17B-2-501, Utah Code Annotated 1953
             13          17B-2-502, Utah Code Annotated 1953
             14          17B-2-503, Utah Code Annotated 1953
             15          17B-2-504, Utah Code Annotated 1953
             16          17B-2-505, Utah Code Annotated 1953
             17          17B-2-506, Utah Code Annotated 1953
             18          17B-2-507, Utah Code Annotated 1953
             19          17B-2-508, Utah Code Annotated 1953
             20          17B-2-509, Utah Code Annotated 1953
             21          17B-2-510, Utah Code Annotated 1953
             22          17B-2-511, Utah Code Annotated 1953
             23          17B-2-512, Utah Code Annotated 1953
             24          17B-2-513, Utah Code Annotated 1953
             25          17B-2-601, Utah Code Annotated 1953
             26          17B-2-602, Utah Code Annotated 1953
             27          17B-2-603, Utah Code Annotated 1953


             28          17B-2-604, Utah Code Annotated 1953
             29          17B-2-605, Utah Code Annotated 1953
             30          17B-2-606, Utah Code Annotated 1953
             31          17B-2-607, Utah Code Annotated 1953
             32          17B-2-608, Utah Code Annotated 1953
             33          17B-2-609, Utah Code Annotated 1953
             34          17B-2-701, Utah Code Annotated 1953
             35          17B-2-702, Utah Code Annotated 1953
             36          17B-2-703, Utah Code Annotated 1953
             37          17B-2-704, Utah Code Annotated 1953
             38          17B-2-705, Utah Code Annotated 1953
             39          17B-2-706, Utah Code Annotated 1953
             40          17B-2-707, Utah Code Annotated 1953
             41          17B-2-708, Utah Code Annotated 1953
             42      Be it enacted by the Legislature of the state of Utah:
             43          Section 1. Section 17B-2-501 is enacted to read:
             44     
Part 5. Annexation

             45          17B-2-501. Reserved.
             46          This section is reserved.
             47          Section 2. Section 17B-2-502 is enacted to read:
             48          17B-2-502. Annexation of area outside local district -- Multiple areas -- No
             49      requirement to be contiguous.
             50          (1) An area outside the boundaries of a local district may be annexed to the local district
             51      as provided in this part.
             52          (2) The area proposed to be annexed:
             53          (a) may consist of multiple noncontiguous areas; and
             54          (b) need not be adjacent to the boundaries of the proposed annexing local district.
             55          Section 3. Section 17B-2-503 is enacted to read:
             56          17B-2-503. Annexation petition and resolution.
             57          (1) The process to annex an area to a local district may be initiated by:
             58          (a) a petition signed by the owners of private real property that:


             59          (i) is located within the area proposed to be annexed;
             60          (ii) covers at least 10% of the total private land area within the area proposed to be
             61      annexed; and
             62          (iii) is equal in value to at least 10% of the value of all private real property within the area
             63      proposed to be annexed;
             64          (b) (i) if the local district is located entirely within a single county:
             65          (A) within or as close as practicable to the area proposed to be annexed; or
             66          (B) at the office of the local district; or
             67          (ii) if the local district is located within more than one county:
             68          (A) within the county in which the area proposed to be annexed is located; and
             69          (B) within or as close as practicable to the area proposed to be annexed;
             70          (c) a petition signed by registered voters residing within the area proposed to be annexed
             71      equal in number to at least 10% of the number of votes cast in the same area for the office of
             72      governor at the last regular general election before the filing of the petition;
             73          (d) a resolution adopted by the legislative body of each county whose unincorporated area
             74      includes and each municipality whose boundaries include any of the area proposed to be annexed;
             75      or
             76          (e) if the area proposed to be annexed has been served by the proposed annexing local
             77      district for at least 12 consecutive months immediately preceding adoption of the resolution, a
             78      resolution adopted by the board of trustees of the local district that proposes to annex the area.
             79          (2) Each petition and resolution under Subsection (1) shall:
             80          (a) describe the area proposed to be annexed; and
             81          (b) be accompanied by a map that shows the boundaries of the area proposed to be
             82      annexed.
             83          (3) The legislative body of each county and municipality that adopts a resolution under
             84      Subsection (1)(c) shall, within five days of adopting the resolution, mail or deliver a copy of the
             85      resolution to the board of trustees of the proposed annexing local district.
             86          Section 4. Section 17B-2-504 is enacted to read:
             87          17B-2-504. Petition requirements.
             88          (1) Each petition under Subsections 17B-2-503 (1)(a) and (b) shall:
             89          (a) indicate the typed or printed name and current residence address of each property


             90      owner or registered voter signing the petition;
             91          (b) if it is a property owner petition, indicate the address of the property as to which the
             92      owner is signing the request;
             93          (c) designate up to three signers of the petition as sponsors, one of whom shall be
             94      designated the contact sponsor, with the mailing address and telephone number of each; and
             95          (d) be filed with the board of trustees of the proposed annexing local district.
             96          (2) A signer of a petition may withdraw, or once withdrawn, reinstate the signer's signature
             97      at any time before the public hearing under Section 17B-2-506 by submitting a written withdrawal
             98      or reinstatement with the board of trustees of the proposed annexing local district.
             99          Section 5. Section 17B-2-505 is enacted to read:
             100          17B-2-505. Petition certification.
             101          (1) Within 30 days after the filing of a petition under Subsection 17B-2-503 (1)(a) or (b),
             102      the board of trustees of the proposed annexing local district shall:
             103          (a) with the assistance of officers of the county in which the area proposed to be annexed
             104      is located from whom the board requests assistance, determine whether the petition meets the
             105      requirements of Subsection 17B-2-503 (1)(a) or (b), as the case may be, Subsection 17B-2-503 (2),
             106      and Subsection 17B-2-504 (1); and
             107          (b) (i) if the board determines that the petition complies with the requirements, certify the
             108      petition and mail or deliver written notification of the certification to the contact sponsor; or
             109          (ii) if the board determines that the petition fails to comply with any of the requirements,
             110      reject the petition and mail or deliver written notification of the rejection and the reasons for the
             111      rejection to the contact sponsor.
             112          (2) (a) If the board rejects a petition under Subsection (1)(b)(ii), the petition may be
             113      amended to correct the deficiencies for which it was rejected and then refiled.
             114          (b) A valid signature on a petition that was rejected under Subsection (1)(b)(ii) may be
             115      used toward fulfilling the applicable signature requirement of the petition as amended under
             116      Subsection (2)(a).
             117          (3) The board shall process an amended petition filed under Subsection (2)(a) in the same
             118      manner as an original petition under Subsection (1).
             119          Section 6. Section 17B-2-506 is enacted to read:
             120          17B-2-506. Public hearing.


             121          (1) Except as provided in Section 17B-3-509 , the board of trustees of each local district
             122      that certifies a petition under Subsection 17B-2-505 (1)(b), receives a resolution adopted under
             123      Subsection 17B-2-503 (1)(c), or adopts a resolution under Subsection 17B-2-503 (1)(d) shall hold
             124      a public hearing on the proposed annexation.
             125          (2) Each public hearing under Subsection (1) shall be held:
             126          (a) no later than 45 days after:
             127          (i) for a public hearing relating to a petition filed under Subsection 17B-2-503 (1)(a) or (b),
             128      certification of the petition under Subsection 17B-2-505 (1)(b);
             129          (ii) for a public hearing relating to a resolution adopted under Subsection 17B-2-503 (1)(c)
             130      or (d), adoption of the resolution;
             131          (b) within the area proposed to be annexed;
             132          (c) on a weekday evening other than a holiday beginning no earlier than 6:00 p.m.; and
             133          (d) for the purpose of allowing:
             134          (i) the public to ask questions and obtain further information about the proposed
             135      annexation and issues raised by it; and
             136          (ii) any interested person to address the board regarding the proposed annexation.
             137          (3) A quorum of the board of trustees of the proposed annexing local district shall be
             138      present throughout each public hearing held under this section.
             139          Section 7. Section 17B-2-507 is enacted to read:
             140          17B-2-507. Notice of public hearing.
             141          (1) Before holding a public hearing required under Section 17B-2-506 , the board of
             142      trustees of each proposed annexing local district shall:
             143          (a) mail notice of the public hearing and the proposed annexation to:
             144          (i) each registered voter residing within the area proposed to be annexed, as determined
             145      by the voter registration list maintained by the county clerk as of a date selected by the board of
             146      trustees that is at least 20 but not more than 60 days before the public hearing; and
             147          (ii) each owner of private real property as shown upon the county assessment roll last
             148      equalized as of the previous December 31; and
             149          (b) post notice of the public hearing and the proposed annexation in at least four
             150      conspicuous places within the area proposed to be annexed, no less than five and no more than 30
             151      days before the public hearing.


             152          (2) Each notice required under Subsection (1) shall:
             153          (a) describe the area proposed to be annexed;
             154          (b) identify the proposed annexing local district;
             155          (c) state the date, time, and location of the public hearing; and
             156          (d) explain that property owners and registered voters within the area proposed to be
             157      annexed may protest the annexation by filing a written protest to the local district board of trustees
             158      within 30 days after the public hearing.
             159          Section 8. Section 17B-2-508 is enacted to read:
             160          17B-2-508. Protests -- Election.
             161          (1) Except as provided in Section 17B-2-509 , an owner of private real property located
             162      within and a registered voter residing within an area proposed to be annexed may protest an
             163      annexation by filing a written protest with the board of trustees of the proposed annexing local
             164      district.
             165          (2) Each protest under Subsection (1) shall be filed within 30 days after the date of the
             166      public hearing under Section 17B-3-506 .
             167          (3) (a) Except as provided in Section 17B-2-509 , an election shall be held on the proposed
             168      annexation if timely protests are filed by:
             169          (i) the owners of private real property that:
             170          (A) is located within the area proposed to be annexed; and
             171          (B) covers at least 10% of the total private land area within the area proposed to be
             172      annexed; or
             173          (ii) registered voters residing within the area proposed to be annexed equal in number to
             174      at least 10% of the number of votes cast in the same area for the office of governor at the last
             175      regular general election before the filing of the petition.
             176          (b) If a majority of registered voters residing within the area proposed to be annexed and
             177      voting on the proposal vote:
             178          (i) in favor of annexation, the board may complete the annexation by adopting a resolution
             179      annexing the area; or
             180          (ii) against annexation, the annexation process is terminated and the area proposed to be
             181      annexed may not be the subject of an annexation effort under this part for two years.
             182          Section 9. Section 17B-2-509 is enacted to read:


             183          17B-2-509. Hearing, notice, and protest provisions do not apply for certain petitions.
             184          Sections 17B-2-506 , 17B-2-507 , and 17B-2-508 do not apply if the process to annex an
             185      area to a local district was initiated by:
             186          (1) a petition under Subsection 17B-2-503 (1)(a) that was signed by the owners of private
             187      real property that cover at least 67% of the total private land area within the area proposed to be
             188      annexed; or
             189          (2) a petition under Subsection 17B-2-503 (1)(b) that was signed by registered voters equal
             190      in number to at least 67% of the number of votes cast in the area proposed to be annexed for the
             191      office of governor at the last regular general election before the filing of the petition.
             192          Section 10. Section 17B-2-510 is enacted to read:
             193          17B-2-510. Resolution approving or rejecting the annexation -- Notice of annexation
             194      -- When annexation complete.
             195          (1) The board of trustees of a proposed annexing local district may adopt a resolution
             196      approving or rejecting the annexation after:
             197          (a) expiration of the protest period under Subsection 17B-2-507 (2), if sufficient protests
             198      are not filed to require an election under Subsection 17B-2-507 (3); or
             199          (b) the election under Subsection 17B-2-507 (3), if sufficient protests are filed to require
             200      an election.
             201          (2) (a) Within ten days after adoption of a resolution under Subsection (1) approving an
             202      annexation, the board shall file a written notice of annexation to the State Tax Commission, the
             203      state auditor, and the assessor of the county in which the annexed area is located.
             204          (b) Each notice under Subsection (2)(a) shall be accompanied by a map showing the
             205      boundaries of the local district including the newly annexed area, prepared and certified by a
             206      licensed surveyor.
             207          (3) Upon the board filing the notices required under Subsection (2), the annexation shall
             208      be complete.
             209          Section 11. Section 17B-2-511 is enacted to read:
             210          17B-2-511. Annexation through municipal expansion.
             211          (1) An area outside the boundaries of a local district shall be annexed to the local district
             212      if:
             213          (a) the boundaries of the local district entirely encompass a municipality;


             214          (b) the municipality annexes the area under Title 10, Chapter 2, Part 4, Annexation;
             215          (c) except as provided in Subsection (2), no part of the area is within the boundaries of an
             216      independent special district under Title 17A, Chapter 2, Independent Special Districts, or another
             217      local district that provides the same service as the proposed annexing local district.
             218          (2) (a) Notwithstanding Subsection (1)(c), an area outside the boundaries of a local district
             219      and within the boundaries of an independent special district or another local district that provides
             220      the same service as the proposed annexing local district may be annexed by the proposed annexing
             221      local district if:
             222          (i) the conditions under Subsections (1)(a) and (b) are present; and
             223          (ii) the proposed annexing local district and the independent special district or other local
             224      district follow the same procedure as is required for a boundary adjustment, including both district
             225      boards adopting a resolution approving the annexation of the area to the proposed annexing local
             226      district and the withdrawal of that area from the other district.
             227          (b) Upon both boards adopting a resolution under Subsection (2)(a)(ii), the board of the
             228      annexing local district shall comply with the requirements of Subsection 17B-2-510 (2).
             229          (c) Subsection 17B-2-510 (3) applies to an annexation under this section.
             230          Section 12. Section 17B-2-512 is enacted to read:
             231          17B-2-512. Annexation through expansion of retail district.
             232          (1) For purposes of this section:
             233          (a) "Retail" means, with respect to a service provided by a local district or independent
             234      special district, that the service is provided directly to the ultimate user.
             235          (b) "Wholesale" means, with respect to a service provided by a local district or
             236      independent special district, that the service is not provided directly to the ultimate user but is
             237      provided to a retail provider.
             238          (2) An area outside the boundaries of a local district providing a wholesale service shall
             239      be annexed to the local district if:
             240          (a) the area is annexed by an independent special district or another local district that:
             241          (i) acquires the wholesale service from the local district and provides it as a retail service;
             242      and
             243          (ii) is, before the annexation, located entirely within the boundaries of the local district;
             244      and


             245          (b) except as provided in Subsection (3), no part of the area is within the boundaries of an
             246      independent special district under Title 17A, Chapter 2, Independent Special Districts, or another
             247      local district that provides the same wholesale service as the proposed annexing local district.
             248          (3) (a) Notwithstanding Subsection (2)(b), an area outside the boundaries of a local district
             249      providing a wholesale service and located partly or entirely within the boundaries of an
             250      independent special district or another local district that provides the same wholesale service may
             251      be annexed to the local district if:
             252          (i) the conditions under Subsection (2)(a) are present; and
             253          (ii) the proposed annexing local district and the independent special district or other local
             254      district follow the same procedure as is required for a boundary adjustment, including both district
             255      boards adopting a resolution approving the annexation of the area to the proposed annexing local
             256      district and the withdrawal of that area from the other district.
             257          (b) Upon both boards adopting a resolution under Subsection (3)(a)(ii), the board of the
             258      annexing local district shall comply with the requirements of Subsection 17B-2-510 (2).
             259          (c) Subsection 17B-2-510 (3) applies to an annexation under this section.
             260          Section 13. Section 17B-2-513 is enacted to read:
             261          17B-2-513. Boundary adjustment -- Notice and hearing -- Protest -- Resolution
             262      adjusting boundaries -- Notice of the adjustment.
             263          (1) As used in this section, "affected area" means the area located within the boundaries
             264      of one local district that will leave that local district and be included within the boundaries of
             265      another local district because of the boundary adjustment.
             266          (2) The boards of trustees of two or more local districts having common boundaries and
             267      providing the same service may adjust their common boundaries as provided in this section.
             268          (3) (a) The board of trustees of each local district intending to adjust a boundary that is
             269      common with another local district shall:
             270          (i) adopt a resolution indicating the board's intent to adjust a common boundary;
             271          (ii) hold a public hearing on the proposed boundary adjustment no less than 60 days after
             272      the adoption of the resolution under Subsection (3)(a)(i); and
             273          (iii) (A) publish notice once a week for two successive weeks in a newspaper of general
             274      circulation within the local district; or
             275          (B) if there is no newspaper of general circulation within the local district, post notice in


             276      at least four conspicuous places within the local district.
             277          (b) The notice required under Subsection (3)(a)(iii) shall:
             278          (i) state that the board of trustees of the local district has adopted a resolution indicating
             279      the board's intent to adjust a boundary that the local district has in common with another local
             280      district that provides the same service as the local district;
             281          (ii) describe the affected area;
             282          (iii) state the date, time, and location of the public hearing required under Subsection
             283      (3)(a)(ii); and
             284          (iv) state in conspicuous and plain terms that the board will adjust the boundaries unless,
             285      at or before the public hearing under Subsection (3)(a)(ii), written protests to the adjustment are
             286      filed with the board by:
             287          (A) the owners of private real property that:
             288          (I) is located within the affected area; and
             289          (II) covers at least 25% of the total private land area within the affected area; or
             290          (B) registered voters residing within the affected area equal in number to at least 25% of
             291      the votes cast in the affected area for the office of governor at the last regular general election
             292      before the filing of the protests.
             293          (c) The first publication of the notice required under Subsection (3)(a)(iii)(A) shall be
             294      within 14 days after the board's adoption of a resolution under Subsection (3)(a)(i).
             295          (4) After the public hearing required under Subsection (3)(a)(ii), the board of trustees may
             296      adopt a resolution adjusting the common boundary unless, at or before the public hearing, written
             297      protests to the boundary adjustment have been filed with the board by:
             298          (a) the owners of private real property that:
             299          (i) is located within the affected area; and
             300          (ii) covers at least 25% of the total private land area within the affected area; or
             301          (b) registered voters residing within the affected area equal in number to at least 25% of
             302      the votes cast in the affected area for the office of governor at the last regular general election
             303      before the filing of the protests.
             304          (5) A resolution adopted under Subsection (4) does not take effect until the board of each
             305      local district whose boundaries are being adjusted has adopted a resolution under Subsection (4).
             306          (6) (a) Within ten days after adoption of a resolution under Subsection (4), the board shall


             307      file a written notice of the boundary adjustment to the State Tax Commission, the state auditor,
             308      and the clerk and assessor of the county in which the affected area is located.
             309          (b) Each notice under Subsection (6)(a) shall be accompanied by a map showing the
             310      boundaries of the local district after the boundary adjustment, prepared and certified by a licensed
             311      surveyor.
             312          (7) Upon the filing of the notices required under Subsection (6) by the board of each local
             313      district whose boundaries are being adjusted, the boundary adjustment shall be complete.
             314          Section 14. Section 17B-2-601 is enacted to read:
             315     
Part 6. Withdrawal

             316          17B-2-601. Withdrawal of area from local district.
             317          An area within the boundaries of a local district may be withdrawn from the local district
             318      as provided in this part.
             319          Section 15. Section 17B-2-602 is enacted to read:
             320          17B-2-602. Initiation of withdrawal process.
             321          (1) The process to withdraw an area from a local district may be initiated by:
             322          (a) a petition signed by the owners of private real property that:
             323          (i) is located within the area proposed to be withdrawn; and
             324          (ii) covers at least 25% of the total private land area within the area proposed to be
             325      withdrawn;
             326          (b) a petition signed by registered voters residing within the area proposed to be withdrawn
             327      equal in number to at least 25% of the number of votes cast in the same area for the office of
             328      governor at the last regular general election before the filing of the petition; or
             329          (c) a resolution adopted by the board of trustees of the local district in which the area
             330      proposed to be withdrawn is located.
             331          (2) Each petition and resolution under Subsection (1) shall:
             332          (a) describe the area proposed to be withdrawn; and
             333          (b) be accompanied by a map that shows the boundaries of the area proposed to be
             334      withdrawn.
             335          Section 16. Section 17B-2-603 is enacted to read:
             336          17B-2-603. Withdrawal petition requirements.
             337          (1) Each petition under Subsections 17B-2-602 (1)(a) and (b) shall:


             338          (a) indicate the typed or printed name and current residence address of each property
             339      owner or registered voter signing the petition;
             340          (b) if it is a property owner petition, indicate the address of the property as to which the
             341      owner is signing the request;
             342          (c) designate up to three signers of the petition as sponsors, one of whom shall be
             343      designated the contact sponsor, with the mailing address and telephone number of each; and
             344          (d) be filed with the board of trustees of the local district in which the area proposed to be
             345      withdrawn is located.
             346          (2) A signer of a petition may withdraw, or, once withdrawn, reinstate the signer's
             347      signature at any time before the filing of the petition by submitting a written withdrawal or
             348      reinstatement with the board of trustees of the local district in which the area proposed to be
             349      withdrawn is located.
             350          Section 17. Section 17B-2-604 is enacted to read:
             351          17B-2-604. Withdrawal petition certification -- Amended petition.
             352          (1) Within 30 days after the filing of a petition under Subsection 17B-2-602 (1)(a) or (b),
             353      the board of trustees of the local district in which the area proposed to be withdrawn is located
             354      shall:
             355          (a) with the assistance of officers of the county in which the area proposed to be withdrawn
             356      is located from whom the board requests assistance, determine whether the petition meets the
             357      requirements of Subsection 17B-2-603 (1)(a) or (b), as the case may be, Subsection 17B-2-603 (2),
             358      and Subsection 17B-2-604 (1); and
             359          (b) (i) if the board determines that the petition complies with the requirements, certify the
             360      petition and mail or deliver written notification of the certification to the contact sponsor; or
             361          (ii) if the board determines that the petition fails to comply with any of the requirements,
             362      reject the petition and mail or deliver written notification of the rejection and the reasons for the
             363      rejection to the contact sponsor.
             364          (2) (a) If the board rejects a petition under Subsection (1)(b)(i), the petition may be
             365      amended to correct the deficiencies for which it was rejected and then refiled.
             366          (b) A valid signature on a petition that was rejected under Subsection (1)(b)(ii) may be
             367      used toward fulfilling the applicable signature requirement of the petition as amended under
             368      Subsection (2)(a).


             369          (3) The board shall process an amended petition filed under Subsection (2)(a) in the same
             370      manner as an original petition under Subsection (1).
             371          Section 18. Section 17B-2-605 is enacted to read:
             372          17B-2-605. Public hearing -- Quorum of board required to be present.
             373          (1) The board of trustees of each local district that certifies a petition under Subsection
             374      17B-2-604 (1)(b) or adopts a resolution under Subsection 17B-2-602 (1)(c) shall hold a public
             375      hearing on the proposed withdrawal.
             376          (2) Each public hearing under Subsection (1) shall be held:
             377          (a) no later than 45 days after certification of the petition under Subsection
             378      17B-2-604 (1)(b) or adoption of a resolution under Subsection 17B-2-602 (1)(c), as the case may
             379      be;
             380          (b) within the area proposed to be withdrawn or, if it is not practicable to hold a public
             381      hearing in that area, then within the local district at a location as close to the area proposed to be
             382      withdrawn as practicable;
             383          (c) on a weekday evening other than a holiday beginning no earlier than 6:00 p.m.; and
             384          (d) for the purpose of allowing:
             385          (i) the public to ask questions and obtain further information about the proposed
             386      withdrawal and issues raised by it; and
             387          (ii) any interested person to address the board of trustees concerning the proposed
             388      withdrawal.
             389          (3) A quorum of the board of trustees of the local district in which the area proposed to
             390      be withdrawn shall be present throughout each public hearing under this section.
             391          Section 19. Section 17B-2-606 is enacted to read:
             392          17B-2-606. Notice of hearing and withdrawal.
             393          (1) Before holding a public hearing required under Section 17B-2-605 , the board of
             394      trustees of each local district in which the area proposed to be withdrawn is located shall:
             395          (a) publish notice of the public hearing and of the proposed withdrawal in a newspaper of
             396      general circulation within the area proposed to be withdrawn; and
             397          (b) post notice of the public hearing and of the proposed withdrawal in at least four
             398      conspicuous places within the area proposed to be withdrawn, no less than five and no more than
             399      30 days before the public hearing.


             400          (2) Each notice required under Subsection (1) shall:
             401          (a) describe the area proposed to be withdrawn;
             402          (b) identify the local district in which the area proposed to be withdrawn is located; and
             403          (c) state the date, time, and location of the public hearing.
             404          Section 20. Section 17B-2-607 is enacted to read:
             405          17B-2-607. Resolution approving or rejecting withdrawal -- Terms and conditions.
             406          (1) (a) After the public hearing required under Subsection 17B-2-605 (1), the board of
             407      trustees of the local district in which the area proposed to be withdrawn is located may adopt a
             408      resolution:
             409          (i) subject to Subsection (1)(b), rejecting the proposed withdrawal; or
             410          (ii) subject to Subsection (2), approving the withdrawal of some or all of the area from the
             411      local district.
             412          (b) Each resolution rejecting a withdrawal shall include an explanation of the board's
             413      reasons for the rejection.
             414          (2) A board of trustees may not adopt a resolution withdrawing an area from the local
             415      district unless the board determines that:
             416          (a) (i) the area to be withdrawn does not and will not require the service that the local
             417      district provides;
             418          (ii) the local district will be unable to provide service to the area to be withdrawn for the
             419      reasonably foreseeable future; or
             420          (iii) the area to be withdrawn has obtained or may reasonably obtain from another source
             421      the same service that is provided by the local district; and
             422          (b) the withdrawal would not:
             423          (i) result in a breach or default by the local district or adversely affect the ability of the
             424      local district to make payments or perform any other material obligation under:
             425          (A) an agreement with the United States or an agency of the United States;
             426          (B) a note, bond, or other debt or obligation of the local district; or
             427          (C) an agreement between the local district and an entity that has ensured, guaranteed, or
             428      otherwise credit-enhanced a debt or revenue obligation of the local district;
             429          (ii) create an island or peninsula of nondistrict territory within the local district that
             430      adversely affects the local district's ability to provide service or significantly increases the cost of


             431      providing service to the remainder of the local district;
             432          (iii) jeopardize the viability of the remaining local district; and
             433          (iv) require the local district to increase significantly the fees or property taxes it charges
             434      in order to provide to the remainder of the district the same level of service provided before the
             435      withdrawal.
             436          (3) A resolution under Subsection (1)(b) may impose reasonable terms and conditions to
             437      be met before withdrawal may occur including:
             438          (a) a requirement that the owners of property located within the area proposed to be
             439      withdrawn pay their proportionate share of outstanding district bonds by:
             440          (i) making one or more payments in lieu of the taxes or assessments that would have been
             441      imposed without the withdrawal; or
             442          (ii) continuing to subject the property within the area proposed to be withdrawn to property
             443      tax until the bonds are paid;
             444          (b) a requirement that property within the area proposed to be withdrawn continue to be
             445      subject to property tax by the local district to the extent and in those years necessary to prevent a
             446      default on revenue bonds issued by the local district;
             447          (c) the receipt of a firm commitment by a county, municipality, special district, or another
             448      local district to provide to the area proposed to be withdrawn the service provided by the local
             449      district; and
             450          (d) a requirement that the local district and the entity that takes over providing service to
             451      the withdrawn area reasonably agree to payment and other terms regarding the transfer to the other
             452      entity of district facilities and improvements that the local district used before withdrawal to
             453      provide service to the withdrawn area but no longer needs because of the withdrawal.
             454          (4) If a resolution under Subsection (1)(b) imposes conditions under Subsection (3)(d):
             455          (a) any issues upon which the local district and other entity are unable to reach agreement
             456      shall be submitted to binding arbitration; and
             457          (b) payments by the other entity to the local district for district facilities and improvements
             458      shall be applied to pay any outstanding district bonds whose proceeds were used to construct the
             459      facilities or improvements.
             460          (5) If the board of trustees has not adopted a resolution under Subsection (1) within 90
             461      days after certification of a petition under Subsection 17B-2-604 (1)(b) or adoption of a resolution


             462      under Subsection 17B-2-602 (1)(c), the board shall be considered to have rejected the withdrawal.
             463          Section 21. Section 17B-2-608 is enacted to read:
             464          17B-2-608. Notice of withdrawal -- Effective date of withdrawal.
             465          (1) Within ten days after adopting a resolution under Subsection 17B-2-607 (1)(a)(ii)
             466      approving a withdrawal, the board of trustees shall file a written notice of the withdrawal to the
             467      State Tax Commission, the state auditor, and the clerk and assessor of the county in which the
             468      withdrawn area is located.
             469          (2) Each notice under Subsection (1) shall be accompanied by a map showing the
             470      boundaries of the local district after withdrawal, prepared and certified by a licensed surveyor.
             471          (3) Upon the board filing the notices required under Subsection (1), the withdrawal shall
             472      be complete.
             473          Section 22. Section 17B-2-609 is enacted to read:
             474          17B-2-609. Judicial review.
             475          (1) Any affected person may seek judicial review of an approval or rejection of a
             476      withdrawal under this part by filing an action in the district court of the county in which a majority
             477      of the area proposed to be withdrawn is located.
             478          (2) Each action under Subsection (1) shall be filed within 30 days after:
             479          (a) the board's adoption of a resolution under Subsection 17B-2-607 (1); or
             480          (b) if the board fails to adopt a resolution under Subsection 17B-2-607 (1), the date the
             481      board is considered to have rejected the withdrawal under Subsection 17B-2-607 (5).
             482          (3) A court in which an action under Subsection (1) is filed may overturn, in whole or in
             483      part, the board of trustees decision approving or rejecting the withdrawal if the court finds the
             484      board's decision to be arbitrary or capricious.
             485          Section 23. Section 17B-2-701 is enacted to read:
             486     
Part 7. Dissolution

             487          17B-2-701. Definitions.
             488          For purposes of this part:
             489          (1) "Active" means, with respect to a local district, that the district is not inactive.
             490          (2) "Administrative body" means:
             491          (a) if the local district proposed to be dissolved has a duly constituted board of trustees in
             492      sufficient numbers to form a quorum, the board of trustees; or


             493          (b) except as provided in Subsection (2)(a):
             494          (i) for a local district located entirely within a single municipality, the legislative body of
             495      that municipality;
             496          (ii) for a local district located in multiple municipalities within the same county or at least
             497      partly within the unincorporated area of a county, the legislative body of that county; or
             498          (iii) for a local district located within multiple counties, the legislative body of the county
             499      whose boundaries include more of the local district than is included within the boundaries of any
             500      other county.
             501          (3) "Clerk" means:
             502          (a) the board of trustees if the board is also the administrative body under Subsection
             503      (2)(a);
             504          (b) the clerk or recorder of the municipality whose legislative body is the administrative
             505      body under Subsection (2)(a)(i); or
             506          (c) the clerk of the county whose legislative body is the administrative body under
             507      Subsection (2)(a)(ii) or (iii).
             508          (4) "Inactive" means, with respect to a local district, that during the preceding three years
             509      the district has not:
             510          (a) provided any service or otherwise operated;
             511          (b) received property taxes or user or other fees; and
             512          (c) expended any funds.
             513          Section 24. Section 17B-2-702 is enacted to read:
             514          17B-2-702. Dissolution of local district.
             515          A local district may be dissolved as provided in this part.
             516          Section 25. Section 17B-2-703 is enacted to read:
             517          17B-2-703. Initiation of dissolution process.
             518          The process to dissolve a local district may be initiated by:
             519          (1) for an inactive local district:
             520          (a) a petition signed by the owners of private real property that:
             521          (i) is located within the local district proposed to be dissolved; and
             522          (ii) covers at least 25% of the private land area within the local district;
             523          (b) a petition signed by registered voters residing within the local district proposed to be


             524      dissolved equal in number to at least 25% of the number of votes cast in the district for the office
             525      of governor at the last regular general election before the filing of the petition; or
             526          (c) a resolution adopted by the administrative body; and
             527          (2) for an active local district, a petition signed by the owners of 100% of the private real
             528      property located within the local district proposed to be dissolved.
             529          Section 26. Section 17B-2-704 is enacted to read:
             530          17B-2-704. Petition requirements.
             531          (1) Each petition under Subsection 17B-2-703 (1)(a), (b), or (2) shall:
             532          (a) indicate the typed or printed name and current residence address of each property
             533      owner or registered voter signing the petition;
             534          (b) if it is a property owner petition, indicate the address of the property as to which the
             535      owner is signing;
             536          (c) designate up to three signers of the petition as sponsors, one of whom shall be
             537      designated the contact sponsor, with the mailing address and telephone number of each; and
             538          (d) be filed with the clerk.
             539          (2) A signer of a petition to dissolve a local district may withdraw, or, once withdrawn,
             540      reinstate the signer's signature at any time until 30 days after the public hearing under Section
             541      17B-2-706 .
             542          Section 27. Section 17B-2-705 is enacted to read:
             543          17B-2-705. Petition certification.
             544          (1) Within 30 days after the filing of a petition under Subsection 17B-2-703 (1)(a), (b), or
             545      (2), the clerk shall:
             546          (a) with the assistance of officers of the county in which the local district is located from
             547      whom the clerk requests assistance, determine whether the petition meets the requirements of
             548      Subsection 17B-2-704 (1); and
             549          (b) (i) if the clerk determines that the petition complies with the requirements, certify the
             550      petition and mail or deliver written notification of the certification to the contact sponsor; or
             551          (ii) if the clerk determines that the petition fails to comply with any of the requirements,
             552      reject the petition and mail or deliver written notification of the rejection and the reasons for the
             553      rejection to the contact sponsor.
             554          (2) (a) If the clerk rejects a petition under Subsection (1)(b)(ii), the petition may be


             555      amended to correct the deficiencies for which it was rejected and then refiled.
             556          (b) A valid signature on a petition that was rejected under Subsection (1)(b)(ii) may be
             557      used toward fulfilling the applicable signature requirement of the petition as amended under
             558      Subsection (2)(a).
             559          (3) The clerk shall process an amended petition filed under Subsection (2)(a) in the same
             560      manner as an original petition under Subsection (1).
             561          Section 28. Section 17B-2-706 is enacted to read:
             562          17B-2-706. Public hearing.
             563          (1) For each petition certified under Section 17B-2-705 and each resolution adopted under
             564      Subsection 17B-2-703 (1)(c), the administrative body shall hold a public hearing on the proposed
             565      dissolution.
             566          (2) Each public hearing under Subsection (1) shall be held:
             567          (a) no later than 45 days after certification of the petition under Section 17B-2-705 or
             568      adoption of a resolution under Subsection 17B-2-703 (1)(c), as the case may be;
             569          (b) within the local district proposed to be dissolved;
             570          (c) on a weekday evening other than a holiday beginning no earlier than 6:00 p.m.; and
             571          (d) for the purpose of allowing:
             572          (i) the public to ask questions and obtain further information about the proposed
             573      dissolution and issues raised by it; and
             574          (ii) any interested person to address the administrative body concerning the proposed
             575      dissolution.
             576          (3) A quorum of the administrative body shall be present throughout each public hearing
             577      under this section.
             578          Section 29. Section 17B-2-707 is enacted to read:
             579          17B-2-707. Notice of public hearing and of dissolution.
             580          (1) Before holding a public hearing required under Section 17B-2-706 , the administrative
             581      body shall:
             582          (a) publish notice of the public hearing and of the proposed dissolution in a newspaper of
             583      general circulation within the local district proposed to be dissolved; and
             584          (b) post notice of the public hearing and of the proposed dissolution in at least four
             585      conspicuous places within the local district proposed to be dissolved, no less than five and no more


             586      than 30 days before the public hearing.
             587          (2) Each notice required under Subsection (1) shall:
             588          (a) identify the local district proposed to be dissolved and the service it was created to
             589      provide; and
             590          (b) state the date, time, and location of the public hearing.
             591          Section 30. Section 17B-2-708 is enacted to read:
             592          17B-2-708. Dissolution resolution -- Limitations on dissolution.
             593          (1) After the public hearing required under Section 17B-2-706 and subject to Subsection
             594      (2), the administrative body may adopt a resolution dissolving the local district.
             595          (2) A resolution under Subsection (1) may not be adopted unless:
             596          (a) any outstanding debt of the local district is:
             597          (i) satisfied and discharged in connection with the dissolution; or
             598          (ii) assumed by another governmental entity with the consent of all the holders of that debt
             599      and all the holders of other debts of the local district;
             600          (b) for a local district that has provided service during the preceding three years or
             601      undertaken planning or other activity preparatory to providing service:
             602          (i) another entity has committed to provide the same service to the area being served or
             603      proposed to be served by the local district; and
             604          (ii) all who are to receive the service have consented to the service being provided by the
             605      other entity;
             606          (c) adequate provision is made to ensure that any remaining assets of the local district
             607      benefit property owners or others who have through taxes, fees, or assessments paid for the assets;
             608      and
             609          (d) all outstanding contracts to which the local district is a party are resolved through
             610      mutual termination or the assignment of the district's rights, duties, privileges, and responsibilities
             611      to another entity with the consent of the other parties to the contract.





Legislative Review Note
    as of 11-16-00 9:56 AM


A limited legal review of this legislation raises no obvious constitutional or statutory concerns.

Office of Legislative Research and General Counsel


Committee Note

The Political Subdivisions Interim Committee recommended this bill.


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