House Bill No. 1166, introduced by Kelley, amends Section 21-103 of Title 11 of the Oklahoma Statutes, which outlines the procedures for the annexation of territory by cities and towns. The bill modifies the existing requirements for annexation without the consent of a majority of property owners. Specifically, it mandates that municipalities must prepare a plan to extend municipal services—such as water, sewer, fire protection, and law enforcement—prior to publishing notice of the proposed annexation. This plan must be included in the notices published and mailed to property owners, and the municipality is required to complete the implementation of the plan within 120 months unless a different timeline is agreed upon during the public hearing.

Additionally, the bill introduces a provision that allows the prevailing property owner in an annexation dispute to recover court costs and reasonable attorney fees if the municipality withdraws or reverses the annexation ordinance in response to litigation. The bill also clarifies that parcels of land used for agricultural purposes that are annexed will be exempt from certain municipal ordinances, provided they meet specific criteria. The act is set to take effect on November 1, 2025.