(a) A second class city may be reclassified as a first class city. A first class or home rule city may be reclassified as a second class city. Reclassification is proposed by filing a petition with the department. The department shall investigate the proposal and report its findings to the Local Boundary Commission with its recommendations. The commission shall hold at least one public hearing in the city on the proposal. The commission may amend the petition and may impose conditions on the reclassification. If the commission determines that the reclassification, as amended or conditioned if appropriate, meets applicable standards under the state constitution and commission regulations, meets the standards for incorporation under AS 29.05.011 for the class of city proposed in the reclassification petition, and is in the best interests of the state, it may accept the petition. Otherwise, it shall reject the petition. The commission shall notify the city of its decision. The decision may be appealed under AS 44.62 (Administrative Procedure Act).

(b) A petition proposing reclassification may be filed by

(1) a number of voters equal to 15 percent of the number of votes cast in the city at the preceding regular election; or

(2) the council.

(c) [Repealed, § 31 ch 58 SLA 1994.]

(d) The council shall, within 30 days after receiving notification from the Local Boundary Commission that a petition has been accepted, order an election on the question of reclassification. The election shall be held at least 30 days after the order and not later than the next regular election occurring after the 30-day period. If more than one question is to be voted on at the election, each shall appear separately on the ballot.

(e) The council shall certify the election results to the department. If the majority of votes cast is favorable, the city is reclassified 30 days after certification of the election results.