diff --git a/Command.hs b/Command.hs
index 228c1f40e9..129233d740 100644
--- a/Command.hs
+++ b/Command.hs
@@ -22,7 +22,6 @@ import qualified Backend
 import Messages
 import qualified Annex
 import qualified GitRepo as Git
-import Locations
 import Utility
 import Types.Key
 
@@ -181,17 +180,15 @@ withNothing _ _ = error "This command takes no parameters."
 backendPairs :: CommandSeekBackendFiles
 backendPairs a files = liftM (map a) $ Backend.chooseBackends files
 
-{- Filter out files from the state directory, and those matching the
- - exclude glob pattern, if it was specified. -}
+{- Filter out files those matching the exclude glob pattern,
+ - if it was specified. -}
 filterFiles :: [FilePath] -> Annex [FilePath]
 filterFiles l = do
-	let l' = filter notState l
 	exclude <- Annex.getState Annex.exclude
 	if null exclude
-		then return l'
-		else return $ filter (notExcluded $ wildsRegex exclude) l'
+		then return l
+		else return $ filter (notExcluded $ wildsRegex exclude) l
 	where
-		notState f = not $ stateDir `isPrefixOf` f
 		notExcluded r f = isNothing $ match r f []
 
 wildsRegex :: [String] -> Regex
diff --git a/Locations.hs b/Locations.hs
index 7f9626a11b..df4957f3e1 100644
--- a/Locations.hs
+++ b/Locations.hs
@@ -6,8 +6,6 @@
  -}
 
 module Locations (
-	gitStateDir,
-	stateDir,
 	keyFile,
 	fileKey,
 	gitAnnexLocation,
@@ -52,13 +50,6 @@ import qualified GitRepo as Git
  - Everything else should use relative paths.
  -}
 
-{- Long-term, cross-repo state is stored in files inside the .git-annex
- - directory, in the git repository's working tree. -}
-stateDir :: FilePath
-stateDir = addTrailingPathSeparator $ ".git-annex"
-gitStateDir :: Git.Repo -> FilePath
-gitStateDir repo = addTrailingPathSeparator $ Git.workTree repo </> stateDir
-
 {- The directory git annex uses for local state, relative to the .git
  - directory -}
 annexDir :: FilePath
diff --git a/Upgrade/V1.hs b/Upgrade/V1.hs
index 61a8018590..b06f00d34d 100644
--- a/Upgrade/V1.hs
+++ b/Upgrade/V1.hs
@@ -113,7 +113,7 @@ moveLocationLogs = do
 		where
 			oldlocationlogs = do
 				g <- Annex.gitRepo
-				let dir = gitStateDir g
+				let dir = Upgrade.V2.gitStateDir g
 				exists <- liftIO $ doesDirectoryExist dir
 				if exists
 					then do
@@ -123,7 +123,7 @@ moveLocationLogs = do
 			move (l, k) = do
 				g <- Annex.gitRepo
 				let dest = logFile k
-				let dir = gitStateDir g
+				let dir = Upgrade.V2.gitStateDir g
 				let f = dir </> l
 				liftIO $ createDirectoryIfMissing True (parentDir dest)
 				-- could just git mv, but this way deals with
@@ -186,7 +186,7 @@ fileKey1 file = readKey1 $
 	replace "&a" "&" $ replace "&s" "%" $ replace "%" "/" file
 
 logFile1 :: Git.Repo -> Key -> String
-logFile1 repo key = gitStateDir repo ++ keyFile1 key ++ ".log"
+logFile1 repo key = Upgrade.V2.gitStateDir repo ++ keyFile1 key ++ ".log"
 
 lookupFile1 :: FilePath -> Annex (Maybe (Key, Backend Annex))
 lookupFile1 file = do
diff --git a/Upgrade/V2.hs b/Upgrade/V2.hs
index 36ba1a0f21..7e4cfb13a7 100644
--- a/Upgrade/V2.hs
+++ b/Upgrade/V2.hs
@@ -89,3 +89,9 @@ gitAttributesUnWrite repo = do
 		liftIO $ safeWriteFile attributes $ unlines $
 			filter (\l -> not $ l `elem` attrLines) $ lines c
 		Git.run repo "add" [File attributes]
+
+stateDir :: FilePath
+stateDir = addTrailingPathSeparator $ ".git-annex"
+gitStateDir :: Git.Repo -> FilePath
+gitStateDir repo = addTrailingPathSeparator $ Git.workTree repo </> stateDir
+
diff --git a/doc/upgrades.mdwn b/doc/upgrades.mdwn
index bf12f7e438..63fbcf75b7 100644
--- a/doc/upgrades.mdwn
+++ b/doc/upgrades.mdwn
@@ -69,7 +69,6 @@ Example upgrade process:
 	cd localrepo
 	git pull
 	git annex upgrade
-	(Upgrading object directory layout v1 to v2...)
 	git commit -m "upgrade v1 to v2"
 	git push