(a) This section governs the transfer of territory that is either:

1. (1) inside the corporate boundaries of the consolidated city and contiguous to an excluded city; or

2. (2) inside the corporate boundaries of an excluded city and contiguous to the consolidated city.

   IC 36-4-3 does not apply to such a transfer.

(a) want to have that territory transferred from one (1) municipality to the other, they must file:

1. (1) a petition for annexation of that territory with the legislative body of the contiguous municipality; and

2. (2) a petition for disannexation of that territory with the legislative body of the municipality containing that territory.

   Each petition must be signed by at least fifty-one percent (51%) of the owners of land in the territory sought to be transferred. The territory must be reasonably compact in configuration, and its boundaries must generally follow streets or natural boundaries.

3. (c) Each legislative body shall, not later than sixty (60) days after a petition is filed with it under subsection (b), either approve or disapprove the petition, with the following results:

4. (1) If both legislative bodies approve, the transfer of territory takes effect:

   1. (A) on the effective date of the approval of the latter legislative body to act; and
   2. (B) when a copy of each transfer approval has been filed under subsection (f).
5. (2) If the legislative body of the contiguous municipality disapproves or fails to act within the prescribed period, the proceedings are terminated.
6. (3) If the legislative body of the contiguous municipality approves but the legislative body of the other municipality disapproves or fails to act within the prescribed period, the proceedings are terminated unless there is an appeal under subsection (d).
7. (d) In the case described by subsection (c)(3), the petitioners may, not later than sixty (60) days after the disapproval or expiration of the prescribed period, appeal to the circuit court. The appeal must allege that the benefits to be derived by the petitioners from the transfer outweigh the detriments to the municipality that has failed to approve, which is defendant in the appeal.

8. (e) The court shall try an appeal under subsection (d) as other civil actions, but without a jury. If the court determines that:

   1. (1) the requirements of this section have been met; and

   2. (2) the benefits to be derived by the petitioners outweigh the detriments to the municipality;

      it shall order the transfer of territory to take effect on the date its order becomes final and shall file the order under subsection (f). However, if the municipality, or a district of it, is furnishing sanitary sewer service or municipal water service in the territory, or otherwise has expended substantial sums for public facilities (other than roads) specially benefiting the territory, the court shall deny the transfer.

9. (f) A municipal legislative body that approves a transfer of territory under subsection (c) or a court that approves a transfer under subsection (e) shall file a copy of the approval or order, setting forth a legal description of the territory to be transferred, with:

   1. (1) the office of the secretary of state; and
   2. (2) the circuit court clerk of each county in which the municipality is located.
10. (g) Not later than ten (10) days after the second of the two (2) approvals is filed under subsection (f), the municipality that annexes the territory shall provide notice to the chairman of the alcohol and tobacco commission as set forth in IC 7.1-4-9-7 of any retailer's or dealer's premises located within the annexed territory.
11. (h) A petition for annexation or disannexation under this section may not be filed with respect to land as to which a transfer of territory has been disapproved or denied within the preceding three (3) years.

12. (i) The legislative body of a municipality annexing territory under this section shall assign the territory to at least one (1) municipal legislative body district under IC 36-3-4-3 or IC 36-4-6 not later than thirty (30) days after the transfer of territory becomes effective under this section.

    [Pre-Local Government Recodification Citation: 18-4-15-1(a) part.]

    As added by Acts 1980, P.L.212, SEC.2. Amended by P.L.5-1989, SEC.89; P.L.3-1997, SEC.452; P.L.123-2000, SEC.3; P.L.113-2010, SEC.114; P.L.194-2021, SEC.66; P.L.104-2022, SEC.152.