(a) To the extent that funds are made available by any law, for the purposes set out in Code Section 36-40-20, the Office of Treasury and Fiscal Services is authorized and directed to grant such funds to the municipal corporations of this state, as defined in Code Section 36-40-21, on the following basis:

(1) The total amount of the grant shall be divided by the total population of all municipal corporations, to arrive at an average per capita amount. Such per capita amount shall be multiplied in turn by the population of each municipal corporation with a population of 10,000 or less to arrive at the respective grants of such municipal corporations. Such grants shall be referred to as "paragraph (1) grants."

(2) In addition to the amount it would receive under paragraph (1) grants, each municipal corporation with a population under 5,000 shall receive an additional grant equal to 50 percent of the amount it received as a paragraph (1) grant. Such grants shall be referred to as "paragraph (2) grants."

(3) In addition to the amount it would receive under paragraph (1) grants, each municipal corporation with a population of not less than 5,000 and not more than 10,000 shall receive an additional grant equal to 25 percent of the amount it received as paragraph (1) grants. Such grants shall be referred to as "paragraph (3) grants."

(4) The amount remaining for distribution after deducting the total amounts of paragraph (1) grants, paragraph (2) grants, and paragraph (3) grants shall then be divided by the total population of all remaining municipal corporations (eliminating those receiving paragraph (1), paragraph (2), and paragraph (3) grants), to arrive at a per capita amount for such remaining municipal corporations. The per capita amount as so determined shall then be multiplied by the population of each such remaining municipal corporation to arrive at its respective grant. Such grants shall be referred to as "paragraph (4) grants."

(b) No municipal corporation which qualifies for state grants under this article shall receive less than $500.00 per annum.

(c) Whenever the term "population" is used in this article, it means population as determined according to the United States decennial census of 1980 or any future such census.

(d) The computation of individual municipal grants as called for in this article shall be prepared and certified by the Office of Treasury and Fiscal Services, which shall make payments as called for in this Code section.