1.1 A bill for an act
1.2 relating to local government; modifying orderly annexation election proceedings
1.3 and detachment provisions; amending Minnesota Statutes 2024, sections 414.031,
1.4 by adding a subdivision; 414.0325, subdivisions 1, 1b, 6; 414.033, subdivision 2,
1.5 by adding a subdivision; 414.036; 414.038; 414.06, subdivisions 1, 2, 3, 7; 572A.03,
1.6 subdivision 4; proposing coding for new law in Minnesota Statutes, chapter 414;
1.7 repealing Minnesota Statutes 2024, section 414.033, subdivision 3.
1.8BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
1.9 Section 1. Minnesota Statutes 2024, section 414.031, is amended by adding a subdivision
1.10to read:
1.11 Subd. 1b.Annexation election.If the annexation is denied or defeated in a referendum
1.12under section 414.0322, no proceeding for the annexation of substantially the same area
1.13may be initiated within two years from the date of the chief administrative law judge's order
1.14unless the new proceeding is initiated by a majority of the area's property owners and the
1.15petition is supported by any abutting townships and municipalities.
1.16 Sec. 2. [414.0322] ANNEXATION ELECTION.
1.17 Subdivision 1.Proceedings triggering an election.Where proceedings for annexation
1.18are initiated under section 414.031 or 414.033, subdivision 2, clause (3), or subdivision 5,
1.19the chief administrative law judge must order an election on the question of annexation.
1.20The chief administrative law judge must:
1.21 (1) fix a day when an election will be held, which is not less than 30 days nor more than
1.2290 days after the entry of the order when an election will be held;
1Sec. 2.
REVISOR MS/KR 25-0104701/07/25
State of Minnesota
This Document can be made available
in alternative formats upon request
HOUSE OF REPRESENTATIVES
H. F. No. 987
NINETY-FOURTH SESSION
Authored by Gordon, Sexton, Warwas and Davis02/17/2025
The bill was read for the first time and referred to the Committee on Elections Finance and Government Operations 2.1 (2) designate a polling place within the area that is primarily and substantially interested
2.2in the proposed annexation, giving preference to the usual polling place or places used in
2.3the area;
2.4 (3) post a copy of the order affirming the petition, including the notice of election, in
2.5three public places in the area at least 20 days before the election;
2.6 (4) publish notice of the election for at least two successive weeks in a newspaper
2.7qualified under chapter 331A as a legal publication in general circulation in the area; and
2.8 (5) appoint necessary election judges from voters in the area and supervise them in their
2.9duties.
2.10 Subd. 2.Eligible voters.Only voters residing within the area of the proposed annexation
2.11are entitled to vote.
2.12 Subd. 3.Election.The election judges must conduct the election so far as practicable
2.13in accordance with the laws regulating special elections. The ballot must bear the words
2.14"For Annexation" and "Against Annexation." The petitioners or annexing municipality must
2.15pay for the ballots and election supplies and the wages of election judges. Immediately upon
2.16completion of the counting of the ballots, the election judges must make a signed and verified
2.17certificate declaring the time and place of holding the election, that they have canvassed
2.18the ballots cast and the number cast both for and against the proposition, and they must then
2.19file the certificate with the chief administrative law judge. If the certificate shows the majority
2.20of the votes cast were "For Annexation," the chief administrative law judge may issue an
2.21order for annexation. If a majority of votes were cast against the annexation, or if there are
2.22an equal number of votes for and against annexation, the chief administrative law judge
2.23must not issue an order for annexation. If the annexation is denied, or if it is defeated in the
2.24referendum, no proceeding for the annexation of substantially the same area may be initiated
2.25within two years from the date of the chief administrative law judge's order, unless the new
2.26proceeding is initiated by a majority of the area's property owners and the petition is
2.27supported by any abutting townships and municipalities. The chief administrative law judge
2.28must notify all parties of record of the election results.
2.29 Sec. 3. Minnesota Statutes 2024, section 414.0325, subdivision 1, is amended to read:
2.30 Subdivision 1.Initiating the proceeding.(a) One or more townships and one or more
2.31municipalities, by joint resolution, may designate an unincorporated area as in need of
2.32orderly annexation. One or more municipalities, by joint resolution with the county, may
2Sec. 3.
REVISOR MS/KR 25-0104701/07/25 3.1designate an unincorporated area in which there is no organized township government as
3.2in need of orderly annexation.
3.3 (b) A designated area is any area which the signatories to a joint resolution for orderly
3.4annexation have identified as being appropriate for annexation, either currently or at some
3.5point in the future, pursuant to the negotiated terms and conditions set forth in the joint
3.6resolution. Land described as a designated area is not, by virtue of being so described,
3.7considered also to be annexed for purposes of this chapter.
3.8 (c) The joint resolution will confer jurisdiction on the chief administrative law judge
3.9over annexations in the designated area and over the various provisions in said agreement
3.10by submission of said joint resolution to the chief administrative law judge.
3.11 (d) The resolution shall must include a description of the designated area and the reasons
3.12for designation.
3.13 (e) Thereafter, an annexation of any part of the designated area may must only be initiated
3.14by:
3.15 (1) submitting to the chief administrative law judge a resolution of any signatory to the
3.16joint resolution; or
3.17 (2) the chief administrative law judge.
3.18 (f) Whenever a state agency, other than the Pollution Control Agency, orders a
3.19municipality to extend a municipal service to an area, the order confers jurisdiction on the
3.20chief administrative law judge to consider designation of the area for orderly annexation.
3.21 (g) If a joint resolution designates an area as in need of orderly annexation and states
3.22that no alteration of its stated boundaries is appropriate, the chief administrative law judge
3.23may review and comment, but may not alter the boundaries.
3.24 (h) If a joint resolution designates an area as in need of orderly annexation, provides for
3.25the conditions for its annexation, and states that no consideration by the chief administrative
3.26law judge is necessary, the chief administrative law judge may review and comment, but
3.27shall must, within 30 days, order the annexation in accordance with the terms of the
3.28resolution.
3.29 Sec. 4. Minnesota Statutes 2024, section 414.0325, subdivision 1b, is amended to read:
3.30 Subd. 1b.Notice of intent to designate an area.(a) At least 30 days before the
3.31municipality or township adopts an orderly annexation agreement, a notice of the intent to
3Sec. 4.
REVISOR MS/KR 25-0104701/07/25 4.1include property in an orderly annexation area must be provided to municipalities adjacent
4.2to the designated area.
4.3 (b) At least ten days before the municipality or township adopts an orderly annexation
4.4agreement, a notice of the intent to include property in an orderly annexation area must be
4.5published in a newspaper of general circulation in both the township and municipality.
4.6 (c) The notice notices under paragraphs (a) and (b) must clearly identify the boundaries
4.7of the area proposed to be included in the orderly annexation agreement. The cost of
4.8providing notice must be equally divided between the municipality and the township, unless
4.9otherwise agreed upon by the municipality and the township. This subdivision applies only
4.10to the initial designation to include property in an orderly annexation area subject to the
4.11orderly annexation agreement, or any expansion of the orderly annexation area subject to
4.12the agreement, and not to any subsequent annexation of any property from within the
4.13designated area. This subdivision also does not apply when the orderly annexation agreement
4.14only designates for immediate annexation property for which all of the property owners
4.15have petitioned to be annexed.
4.16 Sec. 5. Minnesota Statutes 2024, section 414.0325, subdivision 6, is amended to read:
4.17 Subd. 6.Validity, effect of orderly annexation agreement.An orderly annexation
4.18agreement is a binding contract upon all parties to the agreement and is enforceable in the
4.19district court in the county in which the unincorporated property in question is located. For
4.20agreements entered into on or after August 1, 2025, the parties must mutually agree to the
4.21terms of the orderly annexation agreement, but the agreement must not run for more than
4.22ten years. The provisions of an orderly annexation agreement are not preempted by any
4.23provision of this chapter unless the agreement specifically provides so. If an orderly
4.24annexation agreement provides the exclusive procedures by which the unincorporated
4.25property identified in the agreement may be annexed to the municipality, the municipality
4.26shall must not annex that property by any other procedure. Annexation of the designated
4.27area by means other than those identified in the orderly annexation agreement or by a
4.28nonparty to the orderly annexation agreement is prohibited. A petition or other filing by a
4.29nonparty to the orderly annexation agreement must be denied as soon as the parcel to be
4.30annexed is identified as being subject to an orderly annexation agreement. An ordinance
4.31adopted by a nonparty municipality seeking to annex property subject to an orderly
4.32annexation agreement is void and unenforceable.
4Sec. 5.
REVISOR MS/KR 25-0104701/07/25 5.1 Sec. 6. Minnesota Statutes 2024, section 414.033, subdivision 2, is amended to read:
5.2 Subd. 2.Conditions.A municipal council may by ordinance declare land annexed to
5.3the municipality and any such land is deemed to be urban or suburban in character or about
5.4to become so if:
5.5 (1) the land is owned by the municipality;
5.6 (2) the land is completely surrounded by land within the municipal limits;
5.7 (3) (2) the land abuts the municipality and the area to be annexed is 120 acres or less,
5.8and the area to be annexed is not presently served by public wastewater facilities or public
5.9wastewater facilities are not otherwise available, and the municipality receives a petition
5.10for annexation from all the property owners of the land. Except as provided for by an orderly
5.11annexation agreement, this clause may not be used to annex any property contiguous to any
5.12property either simultaneously proposed to be or previously annexed under this clause within
5.13the preceding 12 months if the property is or has been owned at any point during that period
5.14by the same owners and annexation would cumulatively exceed 120 acres; or
5.15 (4) (3) the land has been approved after August 1, 1995, by a preliminary plat or final
5.16plat for subdivision to provide residential lots that average 21,780 square feet or less in area
5.17and the land is located within two miles of the municipal limits.
5.18 Sec. 7. Minnesota Statutes 2024, section 414.033, is amended by adding a subdivision to
5.19read:
5.20 Subd. 2c.Annexation election.If the annexation is denied or if it is defeated in the
5.21referendum under section 414.0322, no proceeding for the annexation of substantially the
5.22same area may be initiated within two years from the date of the chief administrative law
5.23judge's order unless the new proceeding is initiated by a majority of the area's property
5.24owners and the petition is supported by any abutting townships and municipalities.
5.25 Sec. 8. Minnesota Statutes 2024, section 414.036, is amended to read:
5.26 414.036 CITY REIMBURSEMENT TO TOWN TO ANNEX TAXABLE
5.27PROPERTY; CEASING REIMBURSEMENT IF PROPERTY DETACHED.
5.28 (a) Unless otherwise agreed to by the annexing municipality and the affected town, when
5.29an order or other approval under this chapter annexes part of a town to a municipality, the
5.30order or other approval must provide a reimbursement from the municipality to the town
5.31for all or part of the taxable property annexed as part of the order. The reimbursement shall
5.32must be completed in substantially equal payments over not less than two nor more than
5Sec. 8.
REVISOR MS/KR 25-0104701/07/25 6.1eight years from the time of annexation. The municipality must reimburse the township for
6.2all special assessments assigned by the township to the annexed property, and any portion
6.3of debt incurred by the town prior to the annexation and attributable to the property to be
6.4annexed but for which no special assessments are outstanding, in substantially equal payments
6.5over a period of not less than two or no more than eight years.
6.6 (b) Unless otherwise agreed to by the annexing town and affected city, when an order
6.7or other approval under this chapter detaches property that is subject to reimbursement
6.8under paragraph (a), the reimbursement from the municipality to the town ceases on the
6.9date of the order or approval of the detachment.
6.10 Sec. 9. Minnesota Statutes 2024, section 414.038, is amended to read:
6.11 414.038 EFFECT OF ANNEXATION AND DETACHMENT ON TOWNSHIP
6.12ROADS.
6.13 (a) Whenever a municipality annexes property abutting one side of a township road, the
6.14segment of road abutting the annexed property must be treated as a line road and is subject
6.15to section 164.14. Whenever a municipality annexes the property on both sides of a township
6.16road, that portion of road abutting the annexed property ceases to be a town road and becomes
6.17the obligation of the annexing municipality. This section does not prohibit the annexing
6.18municipality from contracting with the township for continued maintenance of the road.
6.19Any portion of a township road that ceases to be a township road pursuant to this section
6.20may still be counted as a township road for the road-and-bridge account revenues for the
6.21year in which the annexation occurs.
6.22 (b) Whenever a town detaches property abutting one side of a township road, the segment
6.23of road abutting the detached property must be treated as a line road and is subject to section
6.24164.14. Whenever a town detaches the property on both sides of a township road, that
6.25portion of road abutting the detached property ceases to be the obligation of the municipality
6.26and becomes the obligation of the detaching town. This section does not prohibit the
6.27detaching town from contracting with the municipality for continued maintenance of the
6.28road.
6.29 Sec. 10. Minnesota Statutes 2024, section 414.06, subdivision 1, is amended to read:
6.30 Subdivision 1.Initiating the proceeding.(a) Property which is situated within a
6.31municipality and abutting the municipal boundary, rural in character and not developed for
6.32urban residential, commercial, or industrial purposes may be detached from the municipality
6.33according to the following procedure.
6Sec. 10.
REVISOR MS/KR 25-0104701/07/25 7.1 (b) The proceeding may be initiated: (1) by submitting to the chief administrative law
7.2judge a resolution of the municipality to which the land is attached or; (2) by submitting to
7.3the chief administrative law judge a petition of all of the property owners of the land to be
7.4detached if the area is less than 40 acres or of 75 percent of the property owners if over 40
7.5acres; or (3) by submitting to the chief administrative law judge a resolution of the township
7.6or a petition of all property owners of the land to be detached, if: (i) the land was annexed
7.7by ordinance under section 414.033; (ii) more than five years have lapsed since the
7.8annexation; and (iii) the land remains rural in character and not developed for urban
7.9residential, commercial, or industrial purposes.
7.10 (c) The petition or resolution shall must set forth the boundaries and the area of the land
7.11to be detached, the number and character of the buildings, the resident population, and the
7.12municipal improvements, if any, in the area, and a statement of the reasons the petitioners,
7.13the township, or the municipality is seeking the detachment. In addition, the petitioners
7.14shall must summarize what, if any, efforts were undertaken prior to filing the resolution or
7.15petition to resolve the issues forming the basis for the resolution or petition.
7.16 (d) If a petition is submitted without a resolution from the city, the petitioners shall must
7.17also provide a copy of the petition to the city from which the land may be detached, and if
7.18the petition includes land for which a property owner has not signed the petition, to each
7.19property owner subject to the petition who has not signed the petition. A copy must also be
7.20mailed or otherwise delivered to the following parties: (1) the clerk of the town to which
7.21the property would be attached if the detachment is granted; (2) the clerk of any other
7.22abutting town or city; and (3) the county recorder in the county in which the land is located.
7.23 (e) If a resolution is submitted by the township, the township must also provide a copy
7.24of the resolution to the city from which the land may be detached and each property owner
7.25subject to the resolution. A copy must also be mailed or otherwise delivered to the following
7.26parties: (1) the clerk of the city from which the property would be detached if the detachment
7.27is granted; (2) the clerk of any other abutting town or city; and (3) the county recorder in
7.28the county in which the land is located.
7.29 Sec. 11. Minnesota Statutes 2024, section 414.06, subdivision 2, is amended to read:
7.30 Subd. 2.Hearing, if needed.(a) If both a resolution of support from the municipality
7.31and a petition by all the property owners are submitted, and no resolution of opposition has
7.32been received from a town as provided in subdivision 1a, no hearing is necessary and the
7.33chief administrative law judge shall must grant the petition.
7Sec. 11.
REVISOR MS/KR 25-0104701/07/25 8.1 (b) If a resolution from a town is submitted, and both a resolution of support from the
8.2municipality and a petition by all property owners are submitted, no hearing is necessary
8.3and the administrative law judge must grant the resolution.
8.4 (c) If both the municipality and town submit a resolution opposing the petition, a hearing
8.5must not be held and the chief administrative law judge shall must deny the petition.
8.6 (d) If both the municipality and all property owners subject to the detachment submit a
8.7petition or resolution opposing the town resolution, a hearing must not be held and the chief
8.8administrative law judge must deny the resolution.
8.9 (e) In any other case, upon receipt of a petition or resolution, the chief administrative
8.10law judge shall must designate a time and place for a hearing in accordance with section
8.11414.09, except that instead of the meetings otherwise required under section 414.01,
8.12subdivision 16, the chief administrative law judge shall must order the parties to participate
8.13in a mediation session. The mediator must be on a list of mediators approved by the Office
8.14of Administrative Hearings, unless the parties stipulate to a mediator not on the list. The
8.15cost of the mediation must be apportioned as provided for in subdivision 7.
8.16 Sec. 12. Minnesota Statutes 2024, section 414.06, subdivision 3, is amended to read:
8.17 Subd. 3.Order.(a) Upon completion of the hearing, the chief administrative law judge
8.18may order the detachment initiated by property owners or a township resolution on finding
8.19that: (1) the requisite number of property owners have signed the petition if initiated by the
8.20property owners, that or the resolution meets the requirements of subdivision 1, paragraph
8.21(b), clause (3), if initiated by a township; (2) the property is rural in character and not
8.22developed for urban residential, commercial or industrial purposes, that; (3) the property is
8.23within the boundaries of the municipality and abuts a boundary, that; (4) the detachment
8.24would not unreasonably affect the symmetry of the detaching municipality, and that; and
8.25(5) the land is not needed for reasonably anticipated future development.
8.26 (b) In making the findings under paragraph (a), the chief administrative law judge shall
8.27must consider all applicable comprehensive plans, land use regulations, and land use maps
8.28of the affected municipality, town, and county that have been adopted at the time the petition
8.29was submitted.
8.30 (c) The chief administrative law judge may deny the detachment on finding that the
8.31remainder of the municipality cannot continue to carry on the functions of government
8.32without undue hardship. The chief administrative law judge may decrease the area of property
8.33to be detached and may include only a part of the proposed area to be detached. If the tract
8Sec. 12.
REVISOR MS/KR 25-0104701/07/25 9.1abuts more than one town, it shall must become a part of each town, being divided by
9.2projecting through it the boundary line between the towns.
9.3 (d) The detached area may be relieved of the primary responsibility for existing
9.4indebtedness of the municipality and be required to assume the indebtedness of the town
9.5of which it becomes a part, in such proportion as the chief administrative law judge shall
9.6deem deems just and equitable having in view the amount of taxes due and delinquent and
9.7the indebtedness of each town and the municipality affected, if any, and for what purpose
9.8the same was incurred, all in relation to the benefit inuring to the detached area as a result
9.9of the indebtedness and the last net tax capacity of the taxable property in each town and
9.10municipality.
9.11 Sec. 13. Minnesota Statutes 2024, section 414.06, subdivision 7, is amended to read:
9.12 Subd. 7.Costs.Notwithstanding the provisions of section 414.067, the chief
9.13administrative law judge shall must apportion the costs of the mediation and hearing in an
9.14equitable manner, but unless the chief administrative law judge makes specific findings as
9.15to why a party shall be is responsible for a greater share, the petitioning landowners are
9.16party initiating the proceeding is responsible for at least 50 percent of the total costs.
9.17 Sec. 14. Minnesota Statutes 2024, section 572A.03, subdivision 4, is amended to read:
9.18 Subd. 4.Annexations of unincorporated property.For annexations of unincorporated
9.19property under section 414.031 or 414.033, subdivisions 3 and subdivision 5, the arbitration
9.20panel may order the annexation: (1) if it finds that the subject area is now, or is about to
9.21become, urban or suburban in character; (2) if it finds that municipal government in the
9.22area proposed for annexation is required to protect the public health, safety, and welfare;
9.23or (3) if it finds that the annexation would be in the best interest of the subject area. If only
9.24a part of a township is to be annexed, the panel shall must consider whether the remainder
9.25of the township can continue to carry on the functions of government without undue hardship.
9.26The panel shall must deny the annexation if it finds that the increase in revenues for the
9.27annexing municipality bears no reasonable relation to the monetary value of benefits
9.28conferred upon the annexed area. The panel may deny the annexation: (1) if it appears that
9.29annexation of all or a part of the property to an adjacent municipality would better serve
9.30the interests of the residents of the property; or (2) if the remainder of the township would
9.31suffer undue hardship.
9.32 The panel may alter the boundaries of the area to be annexed by increasing or decreasing
9.33the area so as to include only that property which is now or is about to become urban or
9Sec. 14.
REVISOR MS/KR 25-0104701/07/25 10.1suburban in character or to add property of that character abutting the area proposed for
10.2annexation in order to preserve or improve the symmetry of the area, or to exclude property
10.3that may better be served by another unit of government. The panel may also alter the
10.4boundaries of the proposed annexation so as to follow visible, clearly recognizable physical
10.5features. If the panel determines that part of the area would be better served by another
10.6municipality or township, the panel may initiate and approve annexation on its own motion
10.7by conducting further hearings. In all cases, the arbitration panel shall must set forth the
10.8factors that are the basis for the decision.
10.9 Sec. 15. REPEALER.
10.10 Minnesota Statutes 2024, section 414.033, subdivision 3, is repealed.
10Sec. 15.
REVISOR MS/KR 25-0104701/07/25 414.033 ANNEXATION BY ORDINANCE.
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 chief administrative law judge, 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 chief administrative law judge. If no objections are forthcoming within the said
90-day period, such land may be annexed by ordinance. If objections are filed with the chief
administrative law judge, the chief administrative law judge shall conduct hearings and issue an
order as in the case of annexations under section 414.031, subdivisions 3 and 4.
1R
APPENDIX
Repealed Minnesota Statutes: 25-01047