(2) The department shall approve the petition if the department, in consultation with the district board of directors, determines that:

(a) It is not and would not be feasible for the land described in the petition to receive services from the district; or

(b) The work of the district would not benefit the soil, water or natural resource conditions of the land described in the petition.

(3) The department shall deny the petition if the department, in consultation with the district board, determines that:

(a) It is or would be feasible for the land described in the petition to receive services from the district; and

(b) The work of the district would benefit the soil, water or natural resource conditions of the land described in the petition.

(4) If the department approves the petition, the department shall redefine the boundaries of the district and make any adjustments to the district zones necessary to comply with ORS 568.560.

(5) Land withdrawn from a district with an ad valorem tax is not subject to taxes levied for the district after the withdrawal date. The district board shall provide the notice of boundary change to the Department of Revenue and the county assessor under ORS 568.435.

(6) If a petitioner disagrees with the decision of the department, the petitioner may initiate a referendum on the decision by submitting additional petitions signed by 10 percent or more of the electors residing in the existing district. The referendum election shall be governed by ORS chapter 255. Only electors residing in the existing district are eligible to cast ballots in the referendum election.

(7) If a majority of the ballots cast at the referendum election are in favor of the withdrawal, the department shall approve the petition, redefine the boundaries of the district and make any adjustments to the district zones necessary to comply with ORS 568.560. [2009 c.220 §15]