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allocation based on need and capacity to pay so that amount is reduced <br />accordingly. Occasionally, the "Remainder" is sufficient or exceeds the "Pure" <br />allocation totals and cities receive a small increase in the formula totals. <br />LGA CHART DETAIL EXPLANATION <br />Following are more detailed explanations of the factors included in the LGA <br />Program Structure Chart: <br />• "Needs" Calculation: This is the theoretical amount a city should be <br />spending given how the city compares on several independent factors <br />(which the city does not have control over) which are statistically related to <br />city spending. The factors currently are - <br />o the age of housing (specifically the proportion constructed prior to <br />1940) <br />o household size, <br />o population change (specifically whether or not the city's population <br />has been declining), <br />o traffic accidents per capita, and, <br />o location of the city (metro area or outstate). <br />The equation assigns different weights to each of these factors based upon <br />state -wide statistical analysis, reduces this to a per capita amount and then <br />is multiplied by the city's current population. <br />• Ability to Pay: This is the amount the city could raise on its own. The <br />formula applies the average state -wide property tax rate against the cities <br />actual property tax base, excluding property in tax increment districts. <br />• "Pure" LGA Allocation: This is the amount which a city would receive in <br />LGA if the program were "fully funded" at the state level. It is "needs" minus <br />"ability to pay." <br />• Budget Appropriation: This is the funding level for the program at the state <br />level. <br />• Parameter Filter: This is the step, which adjusts the total funding level for <br />several factors before allocating the fund to cities. This includes - <br />o making set allocations to several cities (such as $450,000 to Coon <br />Rapids — included to help that city fund a transportation <br />improvement); <br />o predetermined per capita amounts to certain types of cities <br />(currently "small cities" —those under 5,000 population —and <br />"outstate regional centers — non -metro cities over 10,000 <br />population); and, <br />o cities who would exceed predetermined caps and floors (these are <br />limits on the increase or decrease which a city can experience on a <br />year to year basis) if the formula were to be imposed with no <br />restrictions. <br />8 <br />4 <br />