(1) On or before June 30, 2025, the department shall adopt reasonable criteria for the designation of neighborhood centers in accordance with section 24-32-3701 (10), including criteria for varying regional contexts. The department shall design the criteria adopted pursuant to this subsection (1) to minimize the fiscal burden on local governments. The criteria adopted by the department pursuant to this subsection (1) must not: (a) Limit or restrict the authority of a local government, including authority relating to zoning, regulation of the use of land, and the imposition of fees, charges, and taxes, notwithstanding the exercise of that authority to establish a neighborhood center; or (b) Require the modification of a charter adopted pursuant to article XX of the state constitution. (2) A local government may designate a neighborhood center pursuant to this section and submit a report to the department in a form and manner determined by the department. The department shall not accept a report designating a neighborhood center that does not comply with the criteria adopted by the department. The department shall notify a local government if it does not accept the local government's report. (3) As of December 31, 2026, excluding grant programs governed by article 32 of title 29, the departments, offices, and agencies identified in section 24-32-3710 shall update grant award criteria to include consideration and prioritization of, to the extent consistent with the purpose of the grant program and any applicable provision of federal law or the state constitution, projects that meet one of the following criteria: (a) The project is in or supports a neighborhood center designated in a report accepted by the department pursuant to subsection (2) of this section; or (b) The project concerns an area that would not meet the criteria for designation as a neighborhood center.
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