Municipal Incorporation Modifications

43
10-2a-220
10-2a-501
10-2a-502
10-2a-502.5
10-2a-503
10-2a-504
10-2a-505
10-2a-505.5
10-2a-506
10-2a-507
10-2a-508
10-2a-509
10-2a-511
6
Municipal Incorporation Modifications
2026 GENERAL SESSION
STATE OF UTAH
Chief Sponsor: Tiara Auxier
Senate Sponsor: Kirk A. Cullimore
LONG TITLE
General Description:
This bill modifies the process to incorporate as a preliminary municipality.
Highlighted Provisions:
This bill:
defines terms and modifies definitions;
authorizes the lieutenant governor's office to charge and collect a fee;
modifies uses of the Municipal Incorporation Expendable Special Revenue Fund;
requires an applicant to engage in good faith coordination with a county for 18 months
before the applicant may file a feasibility request as part of an application to incorporate
an area as a preliminary municipality, with an exception;
modifies the process for a person to apply to incorporate an area as a preliminary
municipality;
authorizes a sponsor and a county to submit data, information, and analysis to the
feasibility consultant evaluating a proposed preliminary municipality;
requires the feasibility consultant to rely on data, information, and analysis that is
objective, reliable, and grounded in area-specific information from the preceding 10
years, including information from nearby areas;
extends the period of time in which a feasibility study shall be completed;
requires the lieutenant governor to hold public information sessions following a
feasibility study;
modifies the requirements to file a petition for incorporation of a preliminary
municipality, including:
modifying the requirements for a bond, cash deposit, or letter of credit;
requiring a property owner to include an executed improvement warranty; and
requiring a certification that the preliminary municipality will be developed in
accordance with the description in the certified feasibility request; and
makes technical and conforming changes.
Money Appropriated in this Bill:
None
Other Special Clauses:
None
Utah Code Sections Affected:
AMENDS:
10-2a-220
Effective
05/06/26
, as last amended by Laws of Utah 2024, Chapter 518
10-2a-501
Effective
05/06/26
Repealed
01/01/31
, as last amended by Laws of Utah
2025, Chapter 399
10-2a-502
Effective
05/06/26
Repealed
01/01/31
, as enacted by Laws of Utah 2024,
Chapter 534
10-2a-503
Effective
05/06/26
Repealed
01/01/31
, as enacted by Laws of Utah 2024,
Chapter 534
10-2a-504
Effective
05/06/26
Repealed
01/01/31
, as enacted by Laws of Utah 2024,
Chapter 534
10-2a-505
Effective
05/06/26
Repealed
01/01/31
, as enacted by Laws of Utah 2024,
Chapter 534
10-2a-506
Effective
05/06/26
Repealed
01/01/31
, as last amended by Laws of Utah
2025, Chapter 399
10-2a-507
Effective
05/06/26
Repealed
01/01/31
, as enacted by Laws of Utah 2024,
Chapter 534
10-2a-508
Effective
05/06/26
Repealed
01/01/31
, as enacted by Laws of Utah 2024,
Chapter 534
10-2a-509
Effective
05/06/26
Repealed
01/01/31
, as enacted by Laws of Utah 2024,
Chapter 534
ENACTS:
10-2a-502.5
Effective
05/06/26
, Utah Code Annotated 1953
10-2a-505.5
Effective
05/06/26
, Utah Code Annotated 1953
10-2a-511
Effective
05/06/26
, Utah Code Annotated 1953
Be it enacted by the Legislature of the state of Utah:
Section 1. Section
10-2a-220
is amended to read:
10-2a-220
Effective
05/06/26
. Costs of incorporation -- Fees established by
lieutenant governor.
(1)
(a)
There is created an expendable special revenue fund known as the "Municipal
Incorporation Expendable Special Revenue Fund."
(b)
The fund shall consist of:
(i)
appropriations from the Legislature;
(ii)
payments that feasibility request sponsors make to the lieutenant governor under
Subsections
10-2a-205(1)(b)
and
10-2a-206(1)(f)
; and
(iii)
fees the lieutenant governor collects and remits to the fund under this section.
(c)
The lieutenant governor shall deposit all money collected under this section into the
fund.
(2)
(a)
The lieutenant governor shall establish a fee in accordance with Section
63J-1-504

for a cost incurred by the lieutenant governor or the county for an incorporation
proceeding, including:
(i)
a request certification;
(ii)
a petition certification;
(iii)
publication of notices;
(iv)
public hearings;
(v)
all other incorporation activities occurring after the elections; and
(vi)
any other cost incurred by the lieutenant governor or county in relation to an
incorporation proceeding.
(b)
A cost under Subsection
(2)(a)
does not include a cost incurred by a county for
holding an election under Section
10-2a-210
.
(3)
Subject to Subsections
10-2a-205(1)(b)
and
10-2a-206(1)(f)
, the lieutenant governor
shall pay for a cost described in Subsection
(2)(a)
using funds from the Municipal
Incorporation Expendable Special Revenue Fund.
(4)
(a)
A newly incorporated municipality shall:
(i)
pay to the lieutenant governor each fee established under Subsection
(2)
for each
cost described in Subsection
(2)(a)
incurred by the lieutenant governor or the
county;
(ii)
pay the county for a cost described in Subsection
(2)(b)
; and
(iii)
reimburse feasibility request sponsors the cost the feasibility request sponsors
paid for:
(A)
a feasibility study under Section
10-2a-205
; and
(B)
any supplemental feasibility study under Section
10-2a-206
.
(b)
The lieutenant governor shall execute a payback agreement with each new
municipality for the new municipality to pay the fees described in Subsection
(4)(a)

over a period that, except as provided in Subsection
(4)(c)
, may not exceed five years.
(c)
If necessary, the lieutenant governor may extend a fee payment deadline beyond the
deadline described in Subsection
(4)(b)
by amending the payback agreement
described in Subsection
(4)(b)
.
(d)
The lieutenant governor shall deposit each fee the lieutenant governor collects under
Subsection
(4)(a)(i)
into the Municipal Incorporation Expendable Special Revenue
Fund.
(5)
If the lieutenant governor expends funds from the Municipal Incorporation Expendable
Special Revenue Fund that are not repaid to the lieutenant governor under Subsection
(4)(a)(i)
because an area did not incorporate as a municipality, the Legislature shall
appropriate money to the fund in an amount equal to the funds that are not repaid.
(6)
(a)
In addition to fees established under Subsection
(2)
, the lieutenant governor shall
charge a $50,000 fee from a person who files a feasibility request under Section
10-2a-502
and deposit the fee into the fund to cover the lieutenant governor's costs
incurred in fulfilling the duties described in Part 5, Incorporation of a Preliminary
Municipality.
(b)
The lieutenant governor shall return any unexpended amounts of the fee described in
Subsection
(6)(a)
to the person who paid the fee if:
(i)
a person's feasibility request is rejected under Section
10-2a-503
;
(ii)
the person withdraws a feasibility request before the lieutenant governor issues a
certificate of incorporation for the preliminary municipality under Section
10-2a-508
; or
(iii)
the lieutenant governor rejects the person's application for a certificate of
incorporation for the preliminary municipality under Section
10-2a-508
.
Section 2. Section
10-2a-501
is amended to read:
10-2a-501
Effective
05/06/26
Repealed
01/01/31
. Definitions.
As used in this part:
(1)
"Affordable housing" means housing occupied or reserved for occupancy by households
with a gross household income equal to or less than
:

(a)
80% of the median gross income of the applicable municipal or county statistical
area for households of the same size
for rental housing; or
(b)
100% of the median gross income of the applicable municipal or county statistical
area for households of the same size for owner-occupied housing
.
(2)
"Applicant" means an individual or person who applies to incorporate an area as a
preliminary municipality by filing a feasibility request.
(2)
(3)
"Board," in relation to a preliminary municipality, means the same as a council
described in Section
10-3b-402
10-3b-403
.
(3)
(4)
"Board chair," in relation to a preliminary municipality, means the same as a mayor
described in Section
10-3b-402
.
(5)
"Certified feasibility request" means the document that is certified by the lieutenant
governor under Section
10-2a-503
.
(4)
(6)
"Contiguous" means the same as that term is defined in Section
10-2a-102
.
(7)
"Declaration" means a document that an individual signs, affirming a statement to be
true or accurate.
(5)
(8)
"Feasibility consultant" means a person or firm:
(a)
with expertise in the processes and economics of local government; and
(b)
who is independent of, and not affiliated with, a county or a sponsor of a petition to
incorporate a preliminary municipality under this part.
(6)
(9)
"Feasibility request" means a request, described in Section
10-2a-502
, for a
feasibility study for the proposed incorporation of a preliminary municipality.
(10)
"Feasibility study" means an analysis of a certified feasibility request, as described in
Section
10-2a-504
, conducted by a feasibility consultant.
(11)
"Full-time" means 183 days a year or more.
(7)
(12)
"Initial landowners" means the persons who owned the land within the proposed
preliminary municipality area when the
person
applicant
filed the feasibility request
under Section
20A-1-501
as described in this part
.
(8)
(13)
"Municipal service" means the same as that term is defined in Section
10-2a-102
.
(9)
(14)
"Pending annexation area" means an area proposed for annexation in an
annexation petition described in Section
10-2-806
that is filed before, and is still pending
when, a person files the applicable request for a feasibility study under Section
10-2a-502
.
(15)
"Population" means the number of individuals who are full-time residents of a defined
area.
(10)
(16)
"Primary sponsor contact" means:
(a)
in relation to a feasibility request:
(i)
the individual designated as the primary sponsor contact for a feasibility request
under Subsection
10-2a-502(5)(c)
10-2a-502(5)(a)(iii)
; or
(ii)
an individual designated, in writing, by the initial landowners if a replacement
primary sponsor contact is needed; or
(b)
in relation to a petition for incorporation of a preliminary municipality:
(i)
the individual designated as the primary sponsor contact for a petition for
incorporation of a preliminary municipality under Subsection
10-2a-507(1)(d)
10-2a-507(1)(e)
; or
(ii)
an individual designated, in writing, by the initial landowners if a replacement
primary sponsor contact is needed.
(11)
(17)
"Private," in relation to real property, means taxable real property.
(12)
(18)
"Proposed preliminary municipality area" means the area proposed for
incorporation as a preliminary municipality in a feasibility request.
(19)
"Public financing tool" means any mechanism that allows a private entity to utilize tax
revenue.
(13)
(20)
"System infrastructure" means, as shown on the map or plat described in
Subsection
10-2a-502(5)(e)
10-2a-502(5)(a)(v)
for the proposed preliminary municipal
area:
(a)
the main thoroughfares within the proposed preliminary
municipal
municipality

area, including the roads that connect the proposed preliminary municipality area to
an existing road outside the proposed preliminary municipality area; and
(b)
the main lines that will connect a utility
, including culinary water and wastewater
treatment services,
to the proposed preliminary municipality area, including the stubs
that will connect the main lines to the development in the proposed preliminary
municipality area
.
; and
(c)
construction of culinary water facilities, wastewater treatment facilities, or both, if no
services exist that would meet the requirements of the proposed preliminary
municipality area.
(21)
"Utah Population Committee" means the committee created in Section
63C-20-103
.
Section 3. Section
10-2a-502
is amended to read:
10-2a-502
Effective
05/06/26
Repealed
01/01/31
. Incorporation of a
preliminary municipality -- Feasibility request -- Requirements.
(1)
(a)
A person may apply to incorporate an area as a preliminary municipality by filing
a feasibility request
:
(i)
after fulfilling the requirements in Section
10-2a-502.5
; and
(ii)

in accordance with this section.
(b)
A person filing a feasibility request shall:
(i)
pay the fee described in Subsection
10-2a-220(6)
at the same time the person files
the feasibility request; and
(ii)
designate an individual in the application who:
(A)
has the authority to represent the person; and
(B)
will serve as the point of contact for the application.
(2)
Subject to Subsection
(6)
,
a person
an applicant
may file a feasibility request in relation
to an area that the
person
applicant
seeks to incorporate as a preliminary municipality if:
(a)
the area is contiguous;
(b)
no part of the area is within a county of the first class or second class;
(c)
no part of the area is within, or within .25 miles of, a municipality;
(d)
on the day on which the
person
applicant
files the feasibility request:
(i)
the area is owned by no more than three persons, all of whom consent to
incorporation as a preliminary municipality; and
(ii)
at least 50% of the area is undeveloped;
(e)
the persons who sign the feasibility request intend to
and, if the preliminary
municipality is incorporated, shall
develop the area to the point that:
(i)
at least 100 individuals reside
full-time
in the area;
(ii)
the area will have an average population density of no less than seven individuals
per square mile, unless:
(A)
a population density of less than seven individuals per square mile is
necessary in order to connect separate areas that share a demonstrable
community interest; and
(B)
the average population of the area has a population density of no less than
seven individuals per square mile if the land necessary to connect the separate
areas described in Subsection
(2)(e)(ii)(A)
is not included in the calculation;
and
(iii)
at least 10% of the housing in the preliminary municipality is affordable housing;
(f)
the area does not include land owned by the United States government unless:
(i)
the area, including the land owned by the United States government, is
contiguous; and
(ii)
(A)
incorporating the land is necessary to connect separate areas that share a
demonstrable community interest; or
(B)
excluding the land from the area would create an unincorporated island within
the proposed preliminary municipality;
(g)
the area is entirely within one county;
(h)
the applicant has complied with Section
10-2a-502.5
;
and
(h)
(i)
the feasibility request complies with Subsection
(3)
.
(3)
(a)
A proposed preliminary municipality area may not include all or part of a pending
annexation area, unless:
(i)
the portion of the pending annexation area included in the proposed preliminary
municipality area does not exceed 20% of the proposed preliminary municipality
area; and
(ii)
the feasibility request would comply with the requirements of this section
regardless of whether the portion of the pending annexation area included in the
proposed preliminary municipality area is excluded from, or remains included in,
the proposed preliminary municipality area.
(b)
A proposed preliminary municipality area may not include all or part of an area that
is the subject of a completed feasibility study or supplemental feasibility study that
qualifies to proceed under Subsection
10-2a-205(5)(a)
, unless:
(i)
the proposed incorporation that is the subject of the completed feasibility study or
supplemental feasibility study has been defeated by the voters at an election under
Section
10-2a-210
; or
(ii)
the time described in Subsection
10-2a-208(1)
for filing an incorporation petition
based on the completed feasibility study or supplemental feasibility study has
elapsed without the sponsors filing an incorporation petition under Section
10-2a-208
.
(c)
A proposed preliminary municipality area may not include all or part of an area that
is the subject of a completed feasibility study or supplemental feasibility study whose
results comply with Subsection
10-2a-504(4)
, unless the time described in Subsection
10-2a-507(1)
for filing a petition for incorporation based on the completed feasibility
study or supplemental feasibility study has elapsed without the sponsors filing a
petition for incorporation under Section
10-2a-507
.
(4)
Except as provided in Section
10-2a-505
, the lieutenant governor shall consider each
feasibility request that includes an area described in Subsection
(3)(a)
as if the request
does not include the area described in Subsection
(3)(a)
.
(5)
(a)
A person
An applicant
who files a feasibility request under this section shall file
the feasibility request with the lieutenant governor, including in the feasibility request:
(a)
(i)
the signatures of all owners of real property included in the proposed
preliminary municipality area, showing that the owners consent to including the
real property in the proposed preliminary municipality area;
(b)
(ii)
the name, address, and phone number of each owner signing the feasibility
request;
(c)
(iii)
a designation of one individual who signs the feasibility request as the
primary sponsor contact for the feasibility request;
(d)
(iv)
a description of the proposed preliminary municipality area;
(e)
(v)
an accurate map or plat, prepared by a licensed surveyor, showing:
(i)
(A)
a legal description of the boundaries of the proposed preliminary
municipality area and each phase of the proposed preliminary municipality
area;
(ii)
(B)
all development planned for the proposed preliminary municipality area;

and
(iii)
(C)
that the first phase of the proposed preliminary municipality area is
projected to have at least 100
full-time
residents when completed;
(D)
that at least 10% of all housing included in the planned development shall
qualify as affordable housing, with no more than half of the affordable housing
utilized as long-term rentals;
(E)
that at least 10% of the development qualifies as open space; and
(F)
that no more than 30% of all housing included in the planned development
shall be utilized for short-term rentals;
(vi)
an explanation of how the applicant intends to ensure that the requirements of
Subsections
(5)(a)(v)(D)
and
(E)
will be met;
(vii)
an explanation of the public financing tools, if any, the applicant intends to
utilize in developing the preliminary municipality;
(viii)
confirmation that the applicant has complied with the requirements of Section
10-2a-502.5
before filing;
and
(f)
(ix)
a request that the lieutenant governor commission a study to determine the
feasibility of incorporating the area as a preliminary municipality.
(b)
An applicant may provide development plans in the alternative in the feasibility
request by indicating which plan is the primary plan and which plans may be used if
there are market shifts or other market developments, if each plan meets the
requirements of Subsection
(5)(a)
.
(c)
A feasibility request described in Subsection
(5)(a)
may not include a material
change from the proposed development about which the applicant and county
engaged in good faith coordination, as described in Section
10-2a-502.5
.
(d)
The applicant shall sign a declaration at the time of filing, affirming that the
applicant intends to proceed with the preliminary municipality and subsequent
development process as described in t
h
e
feasibility request, and provide the
declaration to the lieutenant governor with the feasibility request.
(6)
(a)
The provisions of this part, providing for the incorporation of a preliminary
municipality, is a pilot project that ends on January 1, 2031.
(b)
Except as provided in Subsection
(7)
,
a person
an applicant
may not file a feasibility
request under this part in a calendar year during which two or more requests have
already been filed in the state.
(7)
A feasibility request does not count towards the limit described in Subsection
(6)(b)
if:
(a)
the sponsors who file the request withdraw the request;
(b)
the lieutenant governor rejects the feasibility request under Subsection
10-2a-503(4)

or
(5)(b)
, and the sponsors:
(i)
do not timely amend the feasibility request under Subsection
10-2a-503(7)(b)
; or
(ii)
are prohibited from amending the feasibility request under Subsection
10-2a-503(7)(c)
; or
(c)
the process to incorporate is prohibited from proceeding under Subsection
10-2a-504(5)(a)
10-2a-504(7)(a)
and the sponsors:
(i)
do not timely file a modified feasibility request under Subsection
10-2a-505(1)(b)(i)
; or
(ii)
are prohibited from filing a modified feasibility request under Subsection
10-2a-505(3)
.
Section 4. Section
10-2a-502.5
is enacted to read:
10-2a-502.5
Effective
05/06/26
. Good faith coordination with county required.
(1)
An applicant may not apply to incorporate an area as a preliminary municipality by
filing a feasibility request in accordance with Section
10-2a-502
unless the applicant has
already engaged in good faith coordination with the county about the planned
development.
(2)
Good faith coordination under this section requires:
(a)
the applicant to submit, make, or propose:
(i)
a land use application, as defined in Section
17-79-102
;
(ii)
a formal petition that a county rezone a particular area; or
(iii)
a development agreement between the applicant and the county;
(b)
the county to provide the applicant with a meaningful opportunity for the applicant to
consult with county staff and officials about the planned development; and
(c)
both the applicant and the county:
(i)
to make reasonable efforts to find areas in which compromise is possible or
alternative solutions may be found; and
(ii)
to identify the specific issues upon which the applicant and county are unable to
reach a mutually agreeable solution, including the factors that make a mutually
agreeable solution impossible or impractical.
(3)
The application, petition, or proposed development agreement described in Subsection
(2)(a)
shall make clear to the county:
(a)
what the applicant is proposing to do with land in the county;
(b)
what the applicant is requesting from the county in order to proceed; and
(c)
that the applicant intends to apply to incorporate an area as a preliminary
municipality if the applicant and county are unable to reach a mutually agreeable
resolution.
(4)
A county shall:
(a)
accept an application described in Subsection
(2)(a)
if the application is complete, as
described in Section
17-79-803
; and
(b)
(i)
accept a petition or proposed development agreement described in Subsection
(2)(a)
for consideration if the petition or proposed development agreement is
sufficiently clear to begin good faith coordination with the applicant; or
(ii)
provide a written explanation of why a petition or proposed development
agreement is not sufficiently clear, including what information the county requires
to render the petition or proposed development agreement sufficiently clear,
within 10 business days of the day on which the county receives the petition or
proposed development agreement.
(5)
(a)
(i)
No earlier than 18 months after the day on which an applicant takes the
action described in Subsection
(2)(a)
, an applicant that intends to file a feasibility
request under Section
10-2a-502
may submit a request to the county that the
county acknowledge the good faith coordination between the applicant and the
county.
(ii)
Notwithstanding the 18 month requirement in Subsection
(5)(a)(i)
, an applicant
may submit a request to the county that the county acknowledge the good faith
coordination between the applicant and the county earlier than 18 months from the
day on which an applicant takes the action described in Subsection
(2)(a)
if the
county has denied the applicant's land use application, formal petition, or
proposed development agreement as a final action.
(b)
The applicant shall include in the request described in Subsection
(5)(a)
:
(i)
a description explaining that:
(A)
the requirements of this section have been met; or
(B)
the requirements of this section have been met but for the county's failure to
provide the applicant with a meaningful opportunity to consult or make
reasonable efforts to find compromise or alternative solutions, or both, as
required in Subsections
(2)(b)
and
(c)
; and
(ii)
that the applicant intends to file a feasibility request under Section
10-2a-502
.
(c)
A county that receives a request described in Subsection
(5)(a)
shall respond to the
request in writing within five business days:
(i)
concurring with the applicant's assertion that the applicant and county have
engaged in good faith coordination, as described in this section, but have been
unable to reach a mutually agreeable solution;
(ii)
disputing the applicant's assertion that the applicant and county have engaged in
good faith coordination; or
(iii)
asserting that the county has engaged in good faith coordination but that the
applicant has failed to make reasonable efforts to find compromise or alternative
solutions.
(d)
If Subsection
(5)(c)(ii)
or
(iii)
apply, the county shall provide a rationale for the
county's dispute or assertion in the response described in Subsection
(5)(c)
.
(6)
An applicant may file a feasibility request under Section
10-2a-502
:
(a)
after the applicant receives the county's response, as described in Subsection
(5)(c)
; or
(b)
if a county fails to timely respond, after the sixth business day following the day on
which the applicant makes a request under Subsection
(5)(a)
.
Section 5. Section
10-2a-503
is amended to read:
10-2a-503
Effective
05/06/26
Repealed
01/01/31
. Processing a feasibility
request -- Certification or rejection -- Processing priority -- Determination by the Utah
Population Committee.
(1)
Within 45 days after the day on which an individual files a feasibility request under
Section
10-2a-502
, the lieutenant governor shall:
(a)
determine whether the feasibility request complies with Section
10-2a-502
; and
(b)
notify the clerk of the county where the proposed preliminary municipality area is
located, in writing, of the determination made under Subsection
(1)(a)
and the
grounds for the determination.
(2)
A county clerk shall
:
(a)
inform the lieutenant governor if the applicant does not meet the requirements of
Subsection
10-2a-502.5(6)
; and
(b)
comply with a request by the lieutenant governor to provide information or a record
to the lieutenant governor or to a sponsor of the feasibility request, to assist in
complying with this part, within five calendar days after the day on which the
lieutenant governor makes the request.
(3)
If the lieutenant governor determines that the feasibility request complies with Section
10-2a-502
, the lieutenant governor shall:
(a)
certify the feasibility request; and
(b)
transmit written notification of the certification to
:

(i)
the primary sponsor contact
,
;

(ii)
the county clerk
,
;
and
(iii)
the Utah Population Committee.
(4)
If the lieutenant governor determines that the feasibility request fails to comply with
Section
10-2a-502
, the lieutenant governor shall reject the feasibility request and notify
the primary sponsor contact and the county clerk, in writing, of the rejection and the
grounds for the rejection.
(5)
(a)
Within 20 days after the day on which the lieutenant governor transmits written
notification under Subsection
(3)(b)
, the Utah Population Committee shall:
(i)
determine whether, based on the map or plat described in Subsection
10-2a-502(5)(e)
, the proposed preliminary municipality will, when all phases of
the map or plat are completed, likely comply with the population, population
density, and contiguity requirements described in Section
10-2a-502
; and
(ii)
provide notice of the determination to the lieutenant governor and the county
clerk.
(b)
If the Utah Population Committee determines, under Subsection
(5)(a)(i)
, that, when
all phases of the plan or plat are completed, the proposed preliminary municipality
will not likely comply with the population, population density, and contiguity
requirements described in Section
10-2a-502
, the lieutenant governor shall rescind
the certification described in Subsection
(3)
and reject the feasibility request.
(6)
The lieutenant governor shall certify or reject feasibility requests in the order in which
the requests are filed.
(7)
(a)
If the lieutenant governor determines, under Subsection
(4)
, that the feasibility
request fails to comply with Section
10-2a-502
, or rejects the feasibility request under
Subsection
(5)(b)
, the sponsors may, subject to Section
10-2a-505
, amend the
feasibility request to correct the deficiencies and refile the feasibility request with the
lieutenant governor.
(b)
Except as provided in Subsection
(7)(c)
, the sponsors may submit an amended
feasibility request within 90 days after the day on which the lieutenant governor
makes the determination or rejection described in Subsection
(7)(a)
.
(c)
The sponsors may not submit an amended feasibility request more than once.
(d)
The lieutenant governor shall consider a feasibility request that is amended and
refiled under Subsection
(7)(a)
as a newly filed feasibility request and process the
feasibility request in accordance with this section.
(8)
If the primary sponsor desires that the feasibility study described in this section be based
off a development plan that is materially different than what is described in the certified
feasibility request:
(a)
the primary sponsor shall notify the lieutenant governor and the lieutenant governor
shall rescind the certification of the feasibility request;
(b)
the primary sponsor is required to comply with Section
10-2a-502.5
regarding the
new development plan;
(c)
the primary sponsor may submit an amended feasibility request as described in
Section
10-2a-502
, subject to the limit described in Subsection
(7)(c)
; and
(d)
the lieutenant governor shall consider an amended feasibility request made under
Subsection
(8)(c)
as a newly filed feasibility request and process the feasibility
request in accordance with this section.
(9)
Any individual in the Office of the Lieutenant Governor or on the Utah Population
Committee who plays a role in the preliminary municipality approval process described
in this part shall be independent of and not affiliated with an applicant or a sponsor of a
petition to incorporate a preliminary municipality.
Section 6. Section
10-2a-504
is amended to read:
10-2a-504
Effective
05/06/26
Repealed
01/01/31
. Feasibility study --
Feasibility study consultant -- Qualifications for proceeding with incorporation.
(1)
Unless the lieutenant governor rescinds the certification under Subsection
10-2a-503(5)(b)
, the lieutenant governor shall, within 90 days after the day on which the
lieutenant governor certifies a feasibility request under Subsection
10-2a-503(3)(a)
, in
accordance with Subsection
(2)
, engage a feasibility consultant to conduct a feasibility
study
on the proposed preliminary municipality, as the proposed preliminary
municipality is described in the certified feasibility request
.
(2)
The lieutenant governor shall:
(a)
select a feasibility consultant in accordance with Title 63G, Chapter 6a, Utah
Procurement Code;
(b)
ensure that the feasibility consultant:
(i)
has expertise in the processes and economics of local government;
and
(ii)
is not affiliated with a sponsor of the feasibility request or the county in which the
proposed municipality is located;
and

(iii)
comply with the relevant provisions of this part;
and
(c)
require the feasibility consultant to:
(i)
submit a draft of the feasibility study to each applicable person with whom the
feasibility consultant is required to consult under Subsection
(3)(c)
within
90
120

days after the day on which the lieutenant governor engages the feasibility
consultant to conduct the study;
(ii)
allow each person to whom the consultant provides a draft under Subsection
(2)(c)(i)
to review and provide comment on the draft;
(iii)
submit
on the same day
a completed feasibility study, including a one-page
summary of the results, to the following within
120
180
days after the day on
which the lieutenant governor engages the feasibility consultant to conduct the
feasibility study:
(A)
the lieutenant governor;
(B)
the county legislative body of the county in which the proposed preliminary
municipality area is located;
(C)
the primary sponsor contact; and
(D)
each person to whom the consultant provided a draft under Subsection
(2)(c)(i)
;
and
(iv)
attend the public
hearings
information sessions
described in Section
10-2a-506

to present the feasibility study results and respond to questions from the public.
(3)
(a)
The feasibility study shall include:
(i)
an analysis of:
(A)
the likely population and population density within the proposed preliminary
municipality area when all phases of the map or plat for the proposed
preliminary municipality area are completed;
and
(B)
the population and population density of the area surrounding the proposed
preliminary municipality area on the day on which the feasibility request was
submitted;
and
(C)
any land use entitlements already established within the proposed preliminary
municipality area;
(ii)
an analysis of the following, determined as if, at the time of the analysis, the
proposed

preliminary municipality area is incorporated as a town with a
population of 100
people
individuals
:
(A)
the initial
and projected
,
five-year
,

and 10-year projected
demographics and
tax base within the boundaries of the proposed preliminary municipality area
and the surrounding area, including household size and income, commercial
and industrial development, and public facilities;
(B)
subject to Subsection
(3)(b)
, the initial
and
,
five-year
, and 10-year
projected
cost of providing
required
municipal services to the proposed preliminary
municipality area, including administrative costs
and the costs of public
infrastructure required to provide each municipal service to the proposed
preliminary municipality area
;
(C)
assuming the same tax categories and tax rates as imposed by the county and
all other current service providers at the time during which the feasibility
consultant prepares the feasibility study, the initial
and
,
five-year
,

and
10-year
projected revenue for the proposed preliminary municipality area;
(D)
the risks and opportunities that might affect the actual costs described in
Subsection
(3)(a)(ii)(B)
or the revenues described in Subsection
(3)(a)(ii)(C)
of
the proposed preliminary municipality area;
(E)
new revenue sources that may be available to the proposed preliminary
municipality area that are not available before the area incorporates, including
an analysis of the amount of revenues the proposed preliminary municipality
area might obtain from those revenue sources;
(F)
the projected tax burden per household of any new taxes that may be levied
within the proposed preliminary municipality area within five
and 10
years
after incorporation as a town; and
(G)
the fiscal impact of the proposed preliminary municipality area's incorporation
as a town on unincorporated areas, other municipalities, special districts,
special service districts, and other governmental entities in the county; and
(iii)
an analysis regarding whether sufficient water will be available to support the
proposed preliminary municipality area when the development of the area is
complete.
(b)
(i)
In calculating the projected costs under Subsection
(3)(a)(ii)(B)
, the feasibility
consultant shall assume the proposed preliminary municipality area will provide a
level and quality of municipal services that fairly and reasonably approximate the
level and quality of municipal services that are provided to the area surrounding
the proposed preliminary municipality area at the time the feasibility consultant
conducts the feasibility study.
(ii)
In calculating the current cost of a
required
municipal service under Subsection
(3)(a)(ii)(B)
, the feasibility consultant shall consider:
(A)
the amount it would cost the proposed preliminary municipality area to
provide the
required
municipal service for the first five years
and 10 years
after
the area incorporates as a town; and
(B)
the proposed or current municipal service provider's initial
and
,
five-year
,
and 10-year
projected cost of providing the
required
municipal service after the
proposed preliminary municipality area incorporates as a town.
(iii)
In calculating costs under Subsection
(3)(a)(ii)(B)
, the feasibility consultant shall
account for inflation and anticipated growth.
(c)
In conducting the feasibility study, the feasibility consultant shall consult with the
following before submitting a draft of the feasibility study under Subsection
(2)(c)(iii)
:
(i)
if the proposed preliminary municipality will include lands owned by the United
States federal government, the entity within the United States federal government
that has jurisdiction over the land;
(ii)
if the proposed preliminary municipality will include lands owned by the state,
the entity within state government that has jurisdiction over the land;
(iii)
each entity that provides, or is proposed to provide, a municipal service to a
portion of the proposed preliminary municipality area;
and
(iv)
each other special service district that provides, or is proposed to provide,
services to a portion of the proposed preliminary municipality area
.
; and
(v)
the legislative body of the county in which the preliminary municipality area is
located.
(4)
(a)
The legislative body of the county in which the preliminary municipality area is
located and the sponsor may both provide the feasibility consultant with data,
information, and analysis the legislative body or sponsor considers relevant to the
feasibility study.
(b)
Data, information, and analysis described in Subsection
(4)(a)
may include:
(i)
areas in which the county and applicant were able to reach a mutually agreeable
solution during the good faith coordination required by Section
10-2a-502.5
;
(ii)
information supporting or explaining the county's position in regard to issues
upon which the applicant and county were unable to reach a mutually agreeable
solution, including the factors that make a mutually agreeable solution impossible
or impractical, during the good faith coordination required by Section
10-2a-502.5
;
(iii)
the county's assessment of the necessary system infrastructure to support the
proposed development, including any fill and grading required before paved roads
can be placed;
(iv)
projected needs for future property tax increases;
(v)
projected county costs in regard to development of the proposed preliminary
municipality area, including development costs outside but adjacent to the
proposed preliminary municipality area;
(vi)
state growth projections, including data from the Utah Population Committee;
(vii)
information about the desires of the property owners with property inside the
proposed preliminary municipality area;
(viii)
deferred maintenance costs in or near the proposed preliminary municipality
area;
(ix)
the sponsor's plan, if any, to utilize a public financing tool in developing the
proposed preliminary municipality area; and
(x)
unique factors about the county or the proposed preliminary municipality or both
that may create a strain on county resources in the future.
(c)
The feasibility consultant shall consider data, information, and analysis provided by
the county under Subsection
(4)(a)
, and use the data, information, and analysis in the
feasibility study in accordance with Subsection
(5)
.
(5)
(a)
The analysis required by Subsection
(3)
shall be based on:
(i)
data, information, and analysis that is objective, reliable, and grounded in
area-specific information from the preceding 10 years, including nearby areas; and
(ii)
professional or market-based studies, including market absorption, pricing, and
existing available lots in the area and nearby areas.
(b)
The feasibility consultant shall:
(i)
only use data, information, or analysis provided by a sponsor or a county if the
feasibility consultant determines the data, information, or analysis can be
independently verified to meet the requirements of Subsection
(5)(a)
;
(ii)
provide an explanation of the determination described in Subsection
(5)(b)(i)
in
the feasibility study; and
(iii)
provide a signed declaration to the lieutenant governor that the feasibility
consultant complied with the requirements of Subsections
(4)
and
(5)
at the time
the feasibility consultant submits a draft or a complete
feasibility study.
(4)
(6)
If the five-year
and 10-year
projected revenues calculated under Subsection
(3)(a)(ii)(C)
exceed the five-year
and 10-year
projected costs calculated under
Subsection
(3)(a)(ii)(B)
by more than 5%, the feasibility consultant shall project and
report the expected annual revenue surplus to
:

(a)
the primary sponsor contact
;
(b)
the legislative body of the county in which the preliminary municipality area is
located;
and
(c)
the lieutenant governor.
(5)
(7)
(a)
Except as provided in Subsection
(5)(b)
(7)(b)
, if the results of the feasibility
study, or a supplemental feasibility study described in Section
10-2a-505
, show that
the average annual amount of revenue calculated under Subsection
(3)(a)(ii)(C)
does
not exceed the average annual cost calculated under Subsection
(3)(a)(ii)(B)
by more
than 5%, the process to incorporate the area that is the subject of the feasibility study
or supplemental feasibility study may not proceed.
(b)
Except as provided in Subsection
10-2a-505(3)
, the process to incorporate an area
described in Subsection
(5)(a)
(7)(a)
may proceed if a subsequent supplemental
feasibility study conducted under Section
10-2a-505
for the proposed incorporation
demonstrates
compliance with Subsection (5)(a)
that the average annual amount of
revenue calculated under Subsection
(3)(a)(ii)(C)
does exceed the average annual
cost calculated under Subsection
(3)(a)(ii)(B)
by more than 5%
.
(6)
(8)
If the results of the feasibility study or revised feasibility study do not comply with
Subsection
(5)
(6)
, and if requested by the sponsors of the request, the feasibility
consultant shall, as part of the feasibility study or revised feasibility study, make
recommendations regarding how the proposed preliminary municipality area may be
altered to comply with Subsection
(5)
(7)
, unless the sponsors are precluded from
modifying the feasibility request under Subsection
10-2a-505(3)
.
(7)
(9)
The lieutenant governor shall post a copy of the feasibility study, and any
supplemental feasibility study described in Section
10-2a-505
, on the lieutenant
governor's website and make a copy available for public review at the lieutenant
governor's office.
Section 7. Section
10-2a-505
is amended to read:
10-2a-505
Effective
05/06/26
Repealed
01/01/31
. Modified feasibility request
-- Supplemental feasibility study.
(1)
(a)
The sponsors of a feasibility request may modify
the request to alter the
boundaries of the proposed preliminary municipality area
a certified feasibility
request
and refile the modified feasibility request with the lieutenant governor
only
if:
(i)
the results of the feasibility study do not comply with Subsection
10-2a-504(5)(a)
10-2a-504(7)(a)
; or
(ii)
(A)
the feasibility request complies with Subsection
10-2a-502(3)(a)
;
(B)
the annexation petition described in Subsection
10-2a-502(3)(a)
that proposed
the annexation of an area that is part of the proposed preliminary municipality
area has been denied; and
(C)
a petition for incorporation described in Section
10-2a-507
, based on the
feasibility request, has not been filed.
(b)
(i)
The sponsors of a feasibility request may not file a modified request under
Subsection
(1)(a)(i)
more than 90 days after the day on which the feasibility
consultant submits the final results of the feasibility study under Subsection
10-2a-504(2)(c)(iii)
.
(ii)
The sponsors of a feasibility request may not file a modified request under
Subsection
(1)(a)(ii)
more than 18 months after filing the original feasibility
request under Section
10-2a-502
.
(c)
A modified feasibility request under Subsection
(1)(a)
shall comply with Subsections
10-2a-502(1)
through
(4)
(5)
.
(d)
Within 20 days after the day on which the lieutenant governor receives the modified
request, the lieutenant governor shall follow the same procedure described in
Subsections
10-2a-503(1)
through
(4)
for the modified feasibility request as for an
original feasibility request.
(2)
The timely filing of a modified feasibility request under Subsection
(1)
gives the
modified feasibility request the same processing priority under Subsection
10-2a-503(6)

as the original feasibility request.
(3)
The sponsors of a feasibility request may not file a modified feasibility request under
Subsection
(1)(a)(i)
more than once.
(4)
Within 10 days after the day on which the county clerk receives a modified feasibility
request under Subsection
(1)(a)
that relates to a request for which a feasibility study has
already been completed, the lieutenant governor shall commission the feasibility
consultant who conducted the feasibility study to conduct a supplemental feasibility
study that accounts for the modified feasibility request.
(5)
The lieutenant governor shall require the feasibility consultant to:
(a)
comply with the requirement to:
(i)
consider data, information, and analysis provided by the county as described in
Subsection
10-2a-504(4)
; and
(ii)
only use data, information, and analysis that meets the requirements of
Subsection
10-2a-504(5)
;
(b)
submit a draft of the supplemental feasibility study to each applicable person with
whom the feasibility consultant is required to consult under Subsection
10-2a-504(3)(c)
within
30
45
days after the day on which the feasibility consultant
is engaged to conduct the supplemental study;
(b)
(c)
allow each person to whom the consultant provided a draft under Subsection
(5)(a)
(5)(b)
to review and provide comment on the draft;
and
(c)
(d)
submit
on the same day
a completed supplemental feasibility study, to the
following within
45
60
days after the day on which the feasibility consultant is
engaged to conduct the feasibility study:
(i)
the lieutenant governor;
(ii)
the county legislative body of the county in which the incorporation is proposed;
(iii)
the primary sponsor contact; and
(iv)
each person to whom the consultant provided a draft under Subsection
(5)(a)
.
(5)(b); and
(e)
provide a signed declaration to the lieutenant governor that the feasibility consultant
will comply with the requirements of this Subsection
(5)
.
(6)
(a)
Subject to Subsections
(3)
and
(6)(b)
, if the results of the supplemental feasibility
study do not comply with Subsection
10-2a-504(4)
10-2a-504(5)
, the sponsors may
further modify the request in accordance with Subsection
(1)
.
(b)
Subsections
(1)(d)
, (4), and (5) apply to a modified feasibility request described in
Subsection
(6)(a)
.
(c)
The lieutenant governor shall consider a modified feasibility request described in
Subsection
(6)(a)
as an original feasibility request for purposes of determining the
modified feasibility request's processing priority under Subsection
10-2a-503(6)
.
Section 8. Section
10-2a-505.5
is enacted to read:
10-2a-505.5
Effective
05/06/26
. County audit of a feasibility study or
supplemental feasibility study.
(1)
Upon receipt of a complete feasibility study under Section
10-2a-504
or a complete
supplemental feasibility study under Section
10-2a-505
, the county shall post the study
or a summary of the study on the county website within one business day of receipt.
(2)
The county may, at the county's own cost, hire a consultant to:
(a)
audit the feasibility study or supplemental feasibility study; and
(b)
provide a written report on the feasibility study or supplemental feasibility study that
confirms or disputes the results of the study.
Section 9. Section
10-2a-506
is amended to read:
10-2a-506
Effective
05/06/26
Repealed
01/01/31
. Public information session
on feasibility study results -- Notice of information session.
(1)
If the results of the feasibility study or supplemental feasibility study comply with
Subsection
10-2a-504(4),
10-2a-504(5)
,
the lieutenant governor shall, after receipt of
the results of the feasibility study or supplemental feasibility study, conduct
public
hearings
at least one public information session
in accordance with this section.
(2)
(a)
If a portion of the proposed preliminary municipality area is approved for
annexation after the feasibility study or supplemental feasibility study is conducted
but before the lieutenant governor conducts a public
hearing
information session

under Subsection
(4)
, the lieutenant governor may not conduct the public
hearing
information session
under Subsection
(4)
unless:
(i)
the sponsors of the feasibility study file a modified feasibility request in
accordance with Section
10-2a-505
; and
(ii)
the results of the supplemental feasibility study comply with Subsection
10-2a-504(4)
.
(b)
For purposes of Subsection
(2)(a)
, an area is approved for annexation if a municipal
legislative body:
(i)
approves an annexation petition proposing the annexation of an area that is part of
the proposed preliminary municipality area under Section
10-2-810
or
10-2-811
; or
(ii)
adopts an ordinance approving the annexation of an area that is part of the
proposed preliminary municipality area under Section
10-2-812
.
(3)
The lieutenant governor shall conduct a public
hearing
information session
:
(a)
within 60 days after the day on which the lieutenant governor receives the results
under Subsection
(1)
or
(2)(a)(ii)
;
(b)
at a location within or near the proposed preliminary municipality
area or through a
virtual, online format
; and
(c)
to allow the feasibility consultant to present the results of the feasibility study and
inform the public about the results.
(4)
The lieutenant governor shall:
(a)
conduct an additional public
hearing
information sessions
following each occasion
when, after the day of the initial public
hearing
information session
, the lieutenant
governor receives the results of a supplemental feasibility study that comply with
Subsection
10-2a-504(4)
; and
(b)
hold the public
hearing
information session
described in Subsection
(4)(a)
:
(i)
within 30 days after the day on which the lieutenant governor receives the results
of the supplemental feasibility study;
(ii)
at a location within or near the proposed preliminary municipality
or through a
virtual, online format
;
(iii)
to inform the public that the feasibility presented to the public at the preceding
public
hearing
information session
does not apply; and
(iv)
to allow the feasibility consultant to present the results of the supplemental
feasibility study and inform the public about the results.
(5)
(a)
At each public
hearing
information session
required under this section, the
lieutenant governor shall:
(a)
(i)
provide a map or plat of the boundary of the proposed preliminary
municipality;
(b)
(ii)
provide a copy of the applicable feasibility study for public review;
(c)
(iii)
allow members of the public to express views about the proposed
preliminary municipality, including views about the proposed boundaries; and
(d)
(iv)
allow the public to ask the feasibility consultant questions about the
applicable feasibility study.
(b)
A public information session may be conducted entirely virtually if the lieutenant
governor is able to comply with this Subsection
(5)
.
(6)
The lieutenant governor shall publish notice of each public
hearing
information session

required under this section for the proposed preliminary municipality area, as a class B
notice under Section
63G-30-102
, for at least three weeks before the day of the public
hearing
information session
.
(7)
(a)
Except as provided in Subsection
(7)(b)
, for
a hearing
a public information
session
described in this section, the notice described in Subsection
(6)
shall:
(i)
include the feasibility study summary described in Subsection
10-2a-504(2)(c)(iii)
;
and
(ii)
indicate that a full copy of the feasibility study is available on the lieutenant
governor's website and for inspection at the lieutenant governor's office.
(b)
Instead of publishing the feasibility summary under Subsection
(7)(a)(i)
, the
lieutenant governor may publish a statement that specifies the following sources
where a person may view or obtain a copy of the feasibility study:
(i)
the lieutenant governor's website;
(ii)
the lieutenant governor's office; and
(iii)
a mailing address and telephone number.
Section 10. Section
10-2a-507
is amended to read:
10-2a-507
Effective
05/06/26
Repealed
01/01/31
. Petition for incorporation --
Requirements and form.
(1)
At any time within one year after the day on which the lieutenant governor completes
the public
hearings
information session
required under Section
10-2a-506
, the owners
of the property who filed the feasibility request under Section
10-2a-502
for the
proposed preliminary municipality area may proceed with the incorporation process by
filing a petition for incorporation of the proposed preliminary municipality that:
(a)
includes the typed or printed name, signature, address, and phone number of the
initial landowners;
(b)
describes the proposed preliminary municipality area, as described in the feasibility
request or the modified feasibility request;
(c)
demonstrates compliance with Subsection
10-2a-504(4)
10-2a-504(5)
;
(d)
states the proposed name for the proposed preliminary municipality;
(e)
designates the primary sponsor contact for the proposed preliminary municipality;
(f)
designates the board chair and three of the four board members who will serve as a
five member council form of government for the preliminary municipality, described
in
Section
Sections

10-3b-402
and
10-3b-403
, for the preliminary municipality;
(g)
is accompanied by an accurate map or plat, prepared by a licensed surveyor,
that
conforms to the information, including planning and phasing, that was included in the
certified feasibility request
showing:
(i)
the boundaries of the proposed preliminary municipality;
(ii)
a single development plan for the proposed municipality, depicting each phase of
the development;
and
(iii)
the structure that will serve as a municipal building or community center where
preliminary municipality or future incorporated town business or operations may
be conducted, which shall be completed in the first phase of the development;
(h)
is accompanied by a bond, cash deposit, or letter of credit that:
(i)
is posted by the initial landowners;
(ii)
is in favor of the county in which the preliminary municipality area is located, up
and until the time the preliminary municipality is incorporated as a town, to
guarantee that the initial landowners will complete any infrastructure for which
construction has
begun or which is necessary, under state law or county ordinance,
for any developed parcels;
(ii)
(iii)
is in favor of the
town that is incorporated from the
proposed preliminary
municipality, to guarantee that the initial landowners will complete the system
infrastructure no later than six years after the day on which the initial landowners
file the petition for incorporation described in this section;
and
(iii)
(iv)
meets the requirements of Subsection
(4)
;
(v)
is held by an institution independent from the sponsor; and
(vi)
will be refunded to the initial landowners in percentages that reflect the progress
toward completing the system infrastructure;
and
(i)
is accompanied by an executed improvement warranty for the improvement warranty
period, which may be a cash deposit, surety bond, letter of credit, or other similar
security, as required by the county, in the amount of up to 10% of the lesser of the:
(i)
county engineer's estimated cost of completion; or
(ii)
the initial landowner's reasonable proven cost of completion;
(j)
is accompanied by payment in full, from the initial landowners, of the costs incurred
by the lieutenant governor for the feasibility study, the public notices, the
hearings
public information sessions
, and the other expenses incurred by the lieutenant
governor to comply with the requirements of this part in relation to the proposed
preliminary municipality
.
; and
(k)
includes a declaration indicating that the sponsor will develop the preliminary
municipality in accordance with the description in the certified feasibility request, or
an alternate description included in the certified feasibility request, subject to
conditions identified in the final feasibility study, including the overall master plan
layout, number of housing units, build schedule phasing, affordable housing
requirements, and structure described in Subsection
(1)(g)(iii)
.
(2)
(a)
If, within six years after the day on which the initial landowners file a petition for
incorporation under Subsection
(1)
, the system infrastructure for the preliminary
municipality is not completed, the portion of the bond, cash deposit, or letter of credit
described in Subsection
(1)(h)
that has not been refunded to the initial landowners
shall forfeit to
the preliminary municipality
:
(i)
the county, if the preliminary municipality has not incorporated as a town; or
(ii)
the town
.
(b)
The provisions of Title 10, Chapter 20, Municipal Land Use, Development, and
Management Act, Title 17, Chapter 79, County Land Use, Development, and
Management Act, and relevant local land use regulations adopted in accordance with
those provisions govern:
(i)
the determination of whether, within the improvement warranty period, an
improvement is not completed, fails, or is demonstrated to be faulty or
substandard; and
(ii)
whether the executed improvement warranty described in Subsection
(1)(i)
shall
forfeit to the county, if the preliminary municipality has not incorporated as a
town, or the town.
(3)
If, within four years after the day on which the first residential certificate of occupancy
is issued for
the development described in Subsection
10-2a-503(5)(e)
a residential unit
within the preliminary municipality
, or six years after the day on which the initial
landowners file a petition for incorporation under Subsection
(1)
, the preliminary
municipality has not transitioned to a town:
(a)
the lieutenant governor shall issue a certificate dissolving the preliminary
municipality;
(b)
all roads and infrastructure within the preliminary municipality revert to the county
in which the preliminary municipality is located;
(c)
the area within the proposed municipality falls under the jurisdiction of the county
and is no longer incorporated; and
(d)
the initial landowners are liable to the county for damages caused to the county due
to the dissolution of the preliminary municipality.
(4)
The amount of the bond, cash deposit, or letter of credit required by Subsection
(1)(h)

shall be determined:
(a)
based on engineering estimates or construction bids; and
(b)
by an independent financial or risk management consultant retained by the county,
subject to consultation with the sponsor.
(5)
The improvement warranty period and improvement warranty described in Subsection
(1)(i)
shall be determined by the county for each type of improvement, according to the
same standards and requirements the county utilizes under Sections
17-79-707
and
17-79-805
.
Section 11. Section
10-2a-508
is amended to read:
10-2a-508
Effective
05/06/26
Repealed
01/01/31
. Processing of petition by
lieutenant governor -- Certification or rejection -- Petition modification.
(1)
Within 45 days after the day on which a petition for incorporation is filed under Section
10-2a-507
, the lieutenant governor shall:
(a)
determine whether the petition for incorporation complies with Section
10-2a-507
;
and
(b)
(i)
if the lieutenant governor determines that the petition for incorporation
complies with Section
10-2a-507
, incorporate the preliminary municipality, issue
a certificate of incorporation, and appoint the board chair and three board
members designated under Subsection
10-2a-507(1)(e)
10-2a-507(1)(f)
; or
(ii)
if the lieutenant governor determines that the petition for incorporation fails to
comply with Section
10-2a-507
, reject the petition for incorporation and notify the
primary sponsor contact in writing of the rejection and the reasons for the
rejection.
(2)
(a)
If the lieutenant governor rejects a petition for incorporation under Subsection
(1)(b)(ii)
, the sponsors of the petition for incorporation may correct the deficiencies
for which the petition for incorporation was rejected and refile the petition for
incorporation with the lieutenant governor.
(b)
Notwithstanding the deadline described in Subsection
10-2a-507(1)
, the sponsors of
the petition for incorporation may file a modified petition for incorporation under
Subsection
(2)(a)
no later than 30 days after the day on which the lieutenant governor
notifies the primary sponsor contact of the rejection under Subsection
(1)(b)(ii)
.
(3)
(a)
Within 20 days after the day on which the lieutenant governor receives a modified
petition for incorporation under Subsection
(2)(a)
, the lieutenant governor shall
review the modified petition for incorporation in accordance with Subsection
(1)
.
(b)
The sponsors of a petition for incorporation may not modify the petition for
incorporation more than once.
Section 12. Section
10-2a-509
is amended to read:
10-2a-509
Effective
05/06/26
Repealed
01/01/31
. Governance of preliminary
municipality -- Utilities -- Road maintenance.
(1)
(a)
Within 30 days after the day on which the lieutenant governor issues a certificate
of incorporation described in Subsection
10-2a-508(1)(b)(i)
, the county in which the
preliminary municipality is located shall appoint one board member for the
preliminary municipality.
(b)
If the county fails to timely comply with Subsection
(1)(a)
, the board chair and the
three board members appointed under Subsection
10-2a-508(1)(b)(i)
shall, by
majority vote, appoint the final board member.
(2)
The board chair and board members, described in Subsection
(1)
, of a preliminary
municipality:
(a)
are not required to be residents of the preliminary municipality; and
(b)
shall serve as the board for the preliminary municipality until replaced by election
under Section
10-2a-510
.
(3)
(a)
Within 14 days after the day on which the first residential certificate of occupancy
is issued for the development described in Subsection
10-2a-503(5)(e)
, the engineer
described in Subsection
10-2a-509(6)
, shall notify the county and the lieutenant
governor, in writing:
(i)
that the first residential certificate of occupancy has been issued for the
preliminary municipality;
(ii)
of the date on which the first residential certificate of occupancy was issued; and
(iii)
of the physical address for which the first residential certificate of occupancy
was issued.
(b)
No later than the next municipal general election, or regular general election, that is
at least 30 days after the date described in Subsection
(3)(a)(ii)
, the initial landowners
shall:
(i)
replace the board chair or a board member with an individual who is a resident of
the preliminary municipality; and
(ii)
notify the county and the lieutenant governor of the appointment, in writing.
(4)
(a)
Subject to Subsection
(4)(b)
, a preliminary municipality has all the powers and
duties of a municipality.
(b)
A preliminary municipality:
(i)
may not impose a tax;
(ii)
may enter into an interlocal agreement with a special district to provide utility
services to the preliminary municipality;
(iii)
has the same authority as another municipality to make decisions regarding
zoning and land use;
(iv)
may not receive an allocation of sales tax or gas tax; and
(v)
may not exercise eminent domain authority.
(5)
As needed, the county shall provide all services and utility connections to the
preliminary municipality that the county provides other areas in the county if the
preliminary municipality:
(a)
pays the uniformly assessed rates for the services and utilities and reasonable
connection fees; and
(b)
complies with the county's established regulations and specifications for the
construction and connection of the local improvements.
(6)
(a)
The preliminary municipality
and subsequently incorporated town
shall maintain
and repair
, or cause to be maintained and repaired,
any roadway that, on the day on
which the individual filed the feasibility request under Section
10-2a-502
:
(a)
(i)
existed within the preliminary municipality;
(b)
(ii)
was within a public right of way that abuts the preliminary municipality; or
(c)
(iii)
was within 1/2 mile of the preliminary municipality and connected to, or
was proposed in the feasibility request to be connected to, the preliminary
municipality.
(b)
Roads on unincorporated land outside of the preliminary municipality area continue
to be governed by the provisions of Title 17, Chapter 79, County Land Use,
Development, and Management Act.
(7)
Before
any development occurs within the preliminary municipality area or
the
preliminary municipality submits a petition to transition to a town, the preliminary
municipality shall select an independent third-party engineer to review and approve all
building permit applications within the preliminary municipality to ensure compliance
with the law.
(8)
Chapter 2, Classification, Boundaries, Consolidation, and Dissolution of Municipalities,
does not apply to a preliminary municipality.
Section 13. Section
10-2a-511
is enacted to read:
10-2a-511
Effective
05/06/26
. Applicability of provisions.
(1)
Except as provided in Subsection
(2)
, for a feasibility request filed in accordance with
Section
10-2a-502
before May 6, 2026, the process to proceed to the incorporation of a
preliminary municipality as described in this part shall be governed by the law that was
in effect as of May 5, 2026.
(2)
Subsection
(1)
does not apply to an applicant who filed a feasibility request before May
6, 2026, if the feasibility request was rejected or otherwise not accepted by the lieutenant
governor and required to be refiled on or after May 6, 2026.
Section 14.
Effective Date.
This bill takes effect on
May 6, 2026
.
3-6-26 4:33 PM