This bill amends Minnesota Statutes to establish a sparsity factor in the city aid formula, which will affect local government aid calculations. Specifically, it introduces a "sparsity adjustment" that provides additional funding for cities based on their population and population density. For cities with a population of 10,000 or more and an average population density of less than 150 per square mile, as well as for cities with a population under 10,000 and an average density of less than 30 per square mile, the sparsity adjustment is set at 200. All other cities will receive a sparsity adjustment of zero. The bill also specifies that the city revenue need calculations will include this sparsity adjustment, which is effective for aids payable in calendar year 2026 and thereafter.

Additionally, the bill modifies the total aid payable under section 477A.013, subdivision 9, increasing the amount for aids payable in 2024 to $644,398,012, and sets a placeholder for the total aid amount for 2026 and thereafter. The amendments to the city revenue need calculations and the introduction of the sparsity adjustment aim to provide more equitable funding to cities based on their unique demographic and geographic challenges.

Statutes affected:
Introduction: 477A.011, 477A.03