§ 10-2a-205.5 — Additional feasibility consultant considerations for proposed incorporation of community council area -- Additional feasibility study requirements.

(1) As used in this section:
(1)(a) "Applicable community council" means the community council that represents the community council area that is proposed to be incorporated.
(1)(b) "Request sponsors" means the sponsors of a feasibility request relating to the proposed incorporation of a community council area.
(2) Subsections 10-2a-205(3)(a) and (b) do not apply to a feasibility study for a proposed incorporation of a community council area.
(3) A feasibility consultant conducting a feasibility study for a proposed incorporation of a community council area shall consider:
(3)(a) population and population density within the community council area;
(3)(b) current and five-year projections of demographics and economic base in the community council area, including household size and income, commercial and industrial development, and public facilities;
(3)(c) projected population growth in the community council area during the next five years;
(3)(d) subject to Subsection (4)(a), the present and five-year projections of the cost, including overhead, of providing the same or a similar service in the community council area as is provided by the municipal services district, including a comparison of:
(3)(d)(i) the estimated cost if the municipal services district continues to provide service;
(3)(d)(ii) the estimated cost if the community council municipality provides service directly or through a contract with another service provider; and
(3)(d)(iii) the estimated cost if an unincorporated island within the community council area is annexed under Section 10-2-814 and the annexing municipality provides service;
(3)(e) subject to Subsection (4)(a), evaluating the present and five-year projections of the cost, including overhead, of a municipal services district providing municipal services to the community council area, comparing those costs assuming that the community council area is included in the service area of the municipal services district with those costs assuming that the community council area is excluded from the service area of the municipal services district;
(3)(f) a projection of any new taxes per household that may be levied within the community council municipality within five years after incorporation;
(3)(g) the fiscal impact that the community council area's incorporation will have on other municipalities and unincorporated areas served by the municipal services district, including any rate increase that may become necessary to maintain required coverage ratios for the municipal services district's debt if, after incorporation:
(3)(g)(i) the municipal services district continues to provide service to the community council area; or
(3)(g)(ii) the community council area provides service directly or through contract with another service provider;
(3)(h) the physical and other assets that will be required by the municipal services district to provide, without interruption or diminution of service, the same or a similar service to the community council municipality upon incorporation;
(3)(i) the physical and other assets that will no longer be required by the municipal services district to continue to provide the current level of service to the remainder of the service area without the community council area if the community council area incorporates and provides services directly or through contract with another service provider;
(3)(j) the number and classification of municipal services district employees who will no longer be required to serve the remaining portions of the service area if a community council area provides service directly or through contract with another service provider upon incorporation, including the dollar amount of the wages, salaries, and benefits attributable to the employees and the estimated cost associated with termination of the employees if the community council municipality does not employ the employees;
(3)(k) if the community council municipality will provide service directly or through another service provider, the effects of maintaining as a base, for a period of three years, the existing schedule of pay and benefits for municipal services district employees who may be transferred to the employment of the community council municipality or to another service provider with which the community council municipality contracts for service; and
(3)(l) any other factor that the feasibility consultant considers relevant to the cost of providing municipal services as a result of a community council area's incorporation or the annexation of one or more unincorporated islands under Section 10-2-814.
(4) (4)(a) For purposes of Subsections (3)(d) and (e):
(4)(a)(i) the feasibility consultant shall assume a level and quality of service to be provided in the future to the community council municipality that fairly and reasonably approximates the level and quality of service that the municipal services district provides to the community council area at the time of the feasibility study;
(4)(a)(ii) in determining the present-value cost of a service that the municipal services district provides, the feasibility consultant shall consider:
(4)(a)(ii)(A) the cost to the community council municipality of providing the service for the first five years after incorporation;
(4)(a)(ii)(B) the municipal services district's present and five-year projected cost of providing the same service to the community council area;
(4)(a)(ii)(C) the present and five-year projected cost of providing the same or a similar service to the community council area if service is provided by a municipality to which one or more unincorporated islands are annexed under Section 10-2-814;
(4)(a)(ii)(D) evaluate and detail the expected cost savings and qualitative benefits that result from a service provider other than the proposed municipality providing some municipal services;
(4)(a)(ii)(E) incorporate into the overall cost projection for the proposed municipality the potential for municipal services to be provided by a service provider other than the proposed municipality; and
(4)(a)(ii)(F) evaluate and detail projected costs for municipal services based on the proposed municipality providing municipal services as compared to service providers other than the proposed municipality providing municipal services funded by those other service providers; and
(4)(a)(iii) the feasibility consultant shall consider inflation and anticipated population growth in calculating the cost of providing service.
(4)(b) A feasibility consultant may not consider an allocation of municipal services district assets or a transfer of municipal services district employees to the extent that the allocation or transfer would impair the municipal services district's ability to continue to provide the current level of service to the remainder of the municipal services district's service area without the community council area, unless the municipal services district consents to the allocation or transfer.
(5) (5)(a) A feasibility consultant shall prepare a written report of the results of the feasibility study.
(5)(b) A report under Subsection (5)(a) shall:
(5)(b)(i) contain a recommendation as to whether the proposed incorporation of the community council area is functionally and financially feasible for the community council area;
(5)(b)(ii) include any conditions the feasibility consultant determines are required to be satisfied to make the incorporation functionally and financially feasible; and
(5)(b)(iii) compare the costs of incorporation to the costs of the unincorporated islands within the community council area being annexed under Section 10-2-814.
(5)(c) (5)(c)(i) Before finalizing a written report under this Subsection (5), the feasibility consultant shall provide a copy of a draft feasibility study report to the request sponsors and the county for their review and comments.
(5)(c)(ii) Based on comments provided under Subsection (5)(c)(i), a feasibility consultant may adjust the draft feasibility study report before finalizing the report.
(6) Upon completion of the feasibility study and preparation of a written report, the feasibility consultant shall deliver a copy of the report to:
(6)(a) the applicable community council;
(6)(b) the request sponsors;
(6)(c) the municipal services district that provides service to the community council area;
(6)(d) the county in which the community council area is located; and
(6)(e) each municipality that borders any part of the community council area.
(7) (7)(a) (7)(a)(i) If the request sponsors or the county in which the community council area is located disagrees with any aspect of a feasibility study report or, if applicable, a feasibility study report modified under Subsection (7)(c), the request sponsors or county may, within 20 business days after receiving a copy of the report under Subsection (6) or a copy of a modified feasibility study report under Subsection (7)(c)(ii), submit to the feasibility consultant a written objection detailing the disagreement.
(7)(a)(ii) Request sponsors who submit a written objection under Subsection (7)(a)(i) shall simultaneously deliver a copy of the objection to the county.
(7)(a)(iii) A county that submits a written objection under Subsection (7)(a)(i) shall simultaneously deliver a copy of the objection to the request sponsors.
(7)(b) (7)(b)(i) The request sponsors or a county may, within 10 business days after receiving an objection under Subsection (7)(a)(i), submit to the feasibility consultant a written response to the objection.
(7)(b)(ii) The request sponsors who submit a response under Subsection (7)(b)(i) shall simultaneously deliver a copy of the response to the county.
(7)(b)(iii) A county that submits a response under Subsection (7)(b)(i) shall simultaneously deliver a copy of the response to the request sponsors.
(7)(c) If an objection is filed under Subsection (7)(a)(i), the feasibility consultant shall, within 20 business days after the expiration of the deadline under Subsection (7)(b)(i) for submitting a response to an objection:
(7)(c)(i) (7)(c)(i)(A) modify the feasibility study report; or
(7)(c)(i)(B) explain in writing why the feasibility consultant is not modifying the feasibility study report; and
(7)(c)(ii) deliver the modified feasibility study report or written explanation to:
(7)(c)(ii)(A) the request sponsors;
(7)(c)(ii)(B) the municipal services district that provides service to the community council area;
(7)(c)(ii)(C) the county in which the community council area is located; and
(7)(c)(ii)(D) each municipality that borders any part of the community council area.
(7)(d) Within seven days after the expiration of the deadline under Subsection (7)(a)(i) for submitting an objection or, if an objection is submitted, within seven days after receiving a modified feasibility study report or written explanation under Subsection (7)(c), but at least 30 days before a public hearing under Subsection (9), the applicable community council shall:
(7)(d)(i) make a copy of the report available to the public at the primary office of the applicable community council; and
(7)(d)(ii) post a copy of the report on the website of the applicable community council, if the applicable community council has a website.
(8) (8)(a) A feasibility study report or, if a feasibility study report is modified under Subsection (7), a modified feasibility study report may not be challenged unless the basis of the challenge is that the report results from collusion or fraud.
(8)(b) Subsection (8)(a) does not apply to an objection to a feasibility study report or a modified feasibility study report under Subsection (7).
(9) (9)(a) Following the expiration of the deadline under Subsection (7)(a)(i) for submitting an objection, or, if an objection is submitted under Subsection (7)(a)(i), following the applicable community council's receipt of the modified feasibility study report or written explanation under Subsection (7)(c), the applicable community council shall, at the applicable community council's next regular meeting, schedule at least one public hearing to be held:
(9)(a)(i) within the following 60 days; and
(9)(a)(ii) for the purpose of allowing:
(9)(a)(ii)(A) the feasibility consultant to present the results of the feasibility study; and
(9)(a)(ii)(B) the public to become informed about the feasibility study results, to ask the feasibility consultant questions about the feasibility study, and to express the public's views about the proposed incorporation of the community council area.
(9)(b) At a public hearing under Subsection (9)(a), the applicable community council shall:
(9)(b)(i) provide a copy of the feasibility study for public review; and
(9)(b)(ii) allow the public to:
(9)(b)(ii)(A) ask the feasibility consultant questions about the feasibility study; and
(9)(b)(ii)(B) express the public's views about the advantages and disadvantages of the proposed incorporation as compared to a potential annexation under Section 10-2-814.
(9)(c) (9)(c)(i) The applicable community council shall publish notice of a hearing under Subsection (9)(a), as a class A notice under Section 63G-30-102, for three consecutive weeks immediately before the public hearing.
(9)(c)(ii) A notice under Subsection (9)(c)(i) shall state:
(9)(c)(ii)(A) the date, time, and location of the public hearing; and
(9)(c)(ii)(B) that a copy of the feasibility study report may be obtained, free of charge, at the office of the applicable community council or, if applicable, on the applicable community council's website.
(10) A community council area may not incorporate if the feasibility study concludes that incorporation of the community council area is not functionally and financially feasible.
(11) Notwithstanding any other provision of this part:
(11)(a) the lieutenant governor shall pay the fees and costs of a feasibility consultant using funds from the Municipal Incorporation Expendable Special Revenue Fund under Section 10-2a-220; and
(11)(b) if the community council area incorporates as a municipality, the newly incorporated municipality shall pay incorporation costs to the lieutenant governor and county as provided in Section 10-2a-220.
(12) Unless the request sponsors and county agree otherwise, conditions that a feasibility study report indicates are necessary to be met for the incorporation of the community council area to be functionally and financially feasible for the proposed community council municipality are binding on the community council municipality and county if the incorporation occurs.

Legislative History

Amended by Chapter 399, 2025 General Session