(a) Whenever the last federal census shows that any city of the first class has fewer than two thousand five hundred (2,500) inhabitants and that any city of the second class has fewer than five hundred (500) inhabitants, the city may be reduced to a city of the second class or to an incorporated town, respectively, upon the adoption of a resolution by the council of the municipal corporations requesting that the grade of the corporations be reduced.
(b)
(1) The Board of Municipal Corporations, upon the receipt of a certified copy of the resolution, shall make an order reducing the grade of the municipal corporation.
(2) Upon being advised of the action of the board, the Governor shall cause a statement to be prepared and transmitted to the mayor of the city or town stating the grade to which it has been reduced.
(c) When the grade of a city has been reduced to city of the second class or to incorporated town, all officers of that city or town shall continue in office until the next general election for the city or town.