1.1 	A bill for an act
1.2 	relating to local government aids; changing the aid
1.3 	formula for certain cities; amending Minnesota
1.4 	Statutes 2004, section 477A.011, subdivision 34.
1.5 	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

1.6 	Section 1. Minnesota Statutes 2004, section 477A.011,
1.7 	subdivision 34, is amended to read:
1.8 		Subd. 34.City revenue need.  (a) For a city with a
1.9 	population equal to or greater than 2,500, "city revenue need"
1.10 	is the sum of (1) 5.0734098 times the pre-1940 housing
1.11 	percentage; plus (2) 19.141678 times the population decline
1.12 	percentage; plus (3) 2504.06334 times the road accidents factor;
1.13 	plus (4) 355.0547; minus (5) the metropolitan area factor; minus
1.14 	(6) 49.10638 times the household size.
1.15 	(b) For a city with a population less than 2,500, "city
1.16 	revenue need" is the sum of (1) 2.387 times the pre-1940 housing
1.17 	percentage; plus (2) 2.67591 times the commercial industrial
1.18 	percentage; plus (3) 3.16042 times the population decline
1.19 	percentage; plus (4) 1.206 times the transformed population;
1.20 	minus (5) 62.772.
1.21 	(c) For a city with a population of 2,500 or more and a
1.22 	population in one of the most recently available five years that
1.23 	was less than 2,500, "city revenue need" is the sum of (1) its
1.24 	city revenue need calculated under paragraph (a) multiplied by
1.25 	its transition factor; plus (2) its city revenue need calculated
2.1 	under the formula in paragraph (b) multiplied by the difference
2.2 	between one and its transition factor.  For purposes of this
2.3 	paragraph, a city's "transition factor" is equal to 0.2
2.4 	multiplied by the number of years that the city's population
2.5 	estimate has been 2,500 or more.  This provision only applies
2.6 	for aids payable in calendar years 2006 to 2008 to cities with a
2.7 	2002 population of less than 2,500.  It applies to any city for
2.8 	aids payable in 2009 and thereafter.
2.9 	(d) The city revenue need cannot be less than zero.
2.10 	(d) (e) For calendar year 2005 and subsequent years, the
2.11 	city revenue need for a city, as determined in paragraphs (a)
2.12 	to (c) (d), is multiplied by the ratio of the annual implicit
2.13 	price deflator for government consumption expenditures and gross
2.14 	investment for state and local governments as prepared by the
2.15 	United States Department of Commerce, for the most recently
2.16 	available year to the 2003 implicit price deflator for state and
2.17 	local government purchases.
2.18 	
EFFECTIVE DATE. This section is effective beginning with
2.19 	aids payable in 2006.