(1) The governing body of any municipality, which is partly or wholly within the boundaries of the district, may adopt a resolution or enact an ordinance declaring that the public convenience and necessity require the exclusion of the territory within the boundaries of the municipality from the district, which resolution or ordinance shall set forth the boundaries of the territory proposed to be excluded. (2) If the district has an outstanding bonded indebtedness, the governing body of the municipality, before finally adopting the resolution or enacting the ordinance, shall submit to the electors of the territory proposed to be excluded from the district, at an election held for that purpose, the proposition of excluding the territory from the district. Any election may be held separately or may be held jointly or concurrently with any primary, general, or regular election held under the laws of the state of Colorado. The election shall be held and conducted as provided in articles 1 to 13 of title 1, C.R.S., with the governing body of the municipality following the procedures and performing the functions of the board of directors of the district pursuant to the provisions of articles 1 to 13 of title 1, C.R.S. The resolution or ordinance calling the election shall recite the objects and purposes for which the indebtedness of the district was incurred, the remaining amount of principal of the indebtedness, and the terms of repayment. The resolution or ordinance shall also designate the date upon which the election shall be held. The form of the ballot shall be as follows: "For Exclusion" and "Against Exclusion". After the results have been surveyed, the clerk of the municipality shall certify the results to the governing body of the municipality who shall certify the results to the board of directors of the district. (3) In the event that the district has no outstanding indebtedness, the governing body of the municipality, before finally adopting the resolution or enacting the ordinance, shall hold a public hearing thereon, notice of which shall be given by publication in at least one newspaper of general circulation within the municipality or county. (4) Within sixty days after receipt of a copy of the resolution or certification of survey of votes showing that the exclusion has been approved, the board of directors of the district may enact a resolution setting forth the same boundaries and, upon the taking effect of its resolution, shall forthwith transmit a certified copy of the resolution to the division of local government in the department of local affairs. (5) The director of the division of local government, upon receipt of a copy of the resolution of the board of directors of the district, shall forthwith issue a certificate reciting that the territory described in the resolution has been duly excluded from the district named, according to the laws of the state of Colorado. The exclusion of the territory shall be deemed effective upon the date of issuance of the certificate, and the validity of the exclusion shall be incontestable in any suit or proceeding which has not been commenced within three months from that date. The division shall forthwith transmit to the governing body of such municipality and to the board of directors of the district a copy of the certificate, and the clerk of the governing body shall forthwith record the copy in the office of the clerk and recorder of the county in which the municipality is located.
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