After a person files a petition for incorporation under ORS 221.031, a city or district may not commence annexation proceedings for any part of the area that is included in the boundaries of the area proposed to be incorporated until after a county court removes that part of the area from within the boundaries of the proposed city or the later of the following:

1. (1) The county court rejects the petition; or
2. (2) The voters do not approve the question of incorporation at an election called by the county court.

[2007 c.669 §2]