[Congressional Bills 103th Congress]
[From the U.S. Government Publishing Office]
[H.R. 581 Introduced in House (IH)]

103d CONGRESS
  1st Session
                                H. R. 581

 To authorize payments to units of general local government for fiscal 
                          years 1993 and 1994.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                            January 26, 1993

  Mr. Conyers (for himself, Mrs. Collins of Illinois, Mr. Waxman, Mr. 
 Lantos, Mr. Owens, Mr. Towns, Ms. Thurman, Mr. Rush, Ms. Maloney, Mr. 
 Payne of New Jersey, Mr. Abercrombie, Mr. Blackwell, Mrs. Collins of 
 Michigan, Mr. Dellums, Mr. de Lugo, Mr. Evans, Mr. Faleomavaega, Mr. 
   Frank of Massachusetts, Mr. Ford of Tennessee, Mr. Jefferson, Mr. 
   Lipinski, Mr. Martinez, Mr. Mazzoli, Mr. Mfume, Mr. Thornton, Mr. 
    Tucker, Ms. Waters, Mr. Wheat, and Mr. Sanders) introduced the 
   following bill; which was referred to the Committee on Government 
                               Operations

_______________________________________________________________________

                                 A BILL


 
 To authorize payments to units of general local government for fiscal 
                          years 1993 and 1994.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Local Partnership Act of 1993''.

SEC. 2. FINDINGS.

    The Congress finds that--
            (1) the total number of individuals in the United States 
        who have full time jobs has declined by 900,000 since June 
        1990, falling from 98,400,000 in June 1990 to 97,500,000 in 
        December 1992;
            (2) effective local governments and the services they 
        provide contribute to national economic growth;
            (3) because of the recession, many local governments are 
        curtailing vital public services and raising local taxes;
            (4) local governments would spend quickly and productively 
        any additional Federal funds they receive under this Act;
            (5) local governments, including counties, cities, towns, 
        Indian tribes, and Alaskan Native villages, provide many 
        essential public services more effectively than the Federal 
        Government;
            (6) the amount of money provided by the Federal Government 
        directly to county, municipal, and township local governments 
        declined from $16,600,000,000 in 1981 to $10,500,000,000 in 
        1990;
            (7) many new Federal laws, especially in the environmental 
        area, require substantial expenditures by local governments to 
        meet national standards without providing any Federal funds to 
        offset these expenditures;
            (8) over the past decade the population of the United 
        States has become increasingly concentrated in wealthier or 
        poorer counties, with fewer people living in middle-income 
        counties in 1987 than in 1977;
            (9) the disparities in per capita income between cities and 
        their suburbs accelerated in the 1980's;
            (10) in the 1980's poverty became increasingly concentrated 
        in the Nation's cities;
            (11) many cities and rural areas face common problems: an 
        exodus of jobs and people, an eroding tax base, and declining 
        social services;
            (12) there is a growing discrepancy in the ability of the 
        Nation's local governments to provide necessary public services 
        for their residents;
            (13) this discrepancy has serious adverse consequences for 
        the entire Nation;
            (14) rising labor unemployment both increases the need for 
        local governments to provide services and reduces their tax 
        receipts;
            (15) there are differences among the States in their rate 
        of labor unemployment;
            (16) in 1989-90 county, municipal, and town governments 
        raised $128,000,000,000 in taxes, of which about 63 percent, or 
        $81,000,000,000, came from property taxes;
            (17) the Federal income tax raises revenue more equitably 
        and efficiently than the local property tax;
            (18) in August 1992 the Congressional Budget Office 
        estimated that total Federal individual and corporate income 
        tax receipts will increase from $574,000,000,000 in fiscal year 
        1992 to $666,000,000,000 in fiscal year 1994; and
            (19) returning some of this extra Federal income tax 
        revenue to local governments in a manner that is focused on the 
        Nation's most impoverished local governments is in the national 
        interest.

SEC. 3. ESTABLISHMENT OF PAYMENT PROGRAM.

    (a) Establishment of Program.--Title 31, United States Code, is 
amended by inserting after chapter 65 the following:

                     ``CHAPTER 67--FEDERAL PAYMENTS

``Sec.
``6701. Payments to local governments.
``6702. Local Government Fiscal Assistance Fund.
``6703. Qualification for payment.
``6704. State area allocations; allocations and payments to territorial 
                            governments.
``6705. Local government allocations.
``6706. Income gap multiplier.
``6707. State variation of local government allocations.
``6708. Adjustments of local government allocations.
``6709. Information used in allocation formulas.
``6710. Public participation.
``6711. Prohibited discrimination.
``6712. Discrimination proceedings.
``6713. Suspension and termination of payments in discrimination 
                            proceedings.
``6714. Compliance agreements.
``6715. Enforcement by the Attorney General of prohibitions on 
                            discrimination.
``6716. Civil action by a person adversely affected.
``6717. Judicial review.
``6718. Audits, investigations, and reviews.
``6719. Reports.
``6720. Definitions and application.
``Sec. 6701. Payments to local governments
    ``(a) Payment and Use.--
            ``(1) Payment.--The Secretary shall pay to each unit of 
        general local government which qualifies for a payment under 
        this chapter an amount equal to the sum of any amounts 
        allocated to the government under this chapter for each payment 
        period. The Secretary shall pay such amount out of the Local 
        Government Fiscal Assistance Fund under section 6702.
            ``(2) Use.--Amounts paid to a unit of general local 
        government under this section shall be used by that unit for--
                    ``(A) rehiring workers, restoring services, or 
                expanding programs which, because of the most recent 
                recession, have been laid-off, eliminated, or 
                overburdened, respectively; and
                    ``(B) carrying out one or more programs of the unit 
                related to--
                            ``(i) education;
                            ``(ii) public safety;
                            ``(iii) health;
                            ``(iv) social services such as emergency 
                        food or shelter;
                            ``(v) activities that are mandated by 
                        Federal law, including such activities under 
                        the Federal Water Pollution Control Act or the 
                        Americans with Disabilities Act of 1990; or
                            ``(vi) any public works project for which 
                        on-site labor can begin within 90 days after 
                        the date of the approval of the project by the 
                        unit.
    ``(b) Timing of Payments.--The Secretary shall pay each amount 
allocated under this chapter to a unit of general local government for 
a payment period by the later of 60 days after the date the amount is 
available or the first day of the payment period.
    ``(c) Adjustments.--(1) Subject to paragraph (2), the Secretary 
shall adjust a payment under this chapter to a unit of general local 
government to the extent that a prior payment to the government was 
more or less than the amount required to be paid.
    ``(2) The Secretary may increase or decrease under this subsection 
a payment to a unit of local government only if the Secretary 
determines the need for the increase or decrease, or the unit requests 
the increase or decrease, within one year after the end of the payment 
period for which the payment was made.
    ``(d) Reservation for Adjustments.--The Secretary may reserve a 
percentage of not more than 0.5 percent of the amount under this 
section for a payment period for all units of general local government 
in a State if the Secretary considers the reserve is necessary to 
ensure the availability of sufficient amounts to pay adjustments after 
the final allocation of amounts among the units of general local 
government in the State.
    ``(e) Repayment of Unexpended Amounts.--
            ``(1) Repayment required.--A unit of general local 
        government shall repay to the Secretary, by not later than 
        November 15, 1994, any amount that is--
                    ``(A) paid to the unit from amounts appropriated 
                under the authority of this section; and
                    ``(B) not expended by the unit by October 31, 1994.
            ``(2) Deposit of amounts repaid.--Amounts received by the 
        Secretary as repayments under this subsection shall be 
        deposited in the general fund of the Treasury as miscellaneous 
        receipts.
    ``(f) Expenditure With Disadvantaged Business Enterprises.--
            ``(1) General rule.--Of amounts paid to a unit of general 
        local government under this chapter for a payment period, not 
        less than 10 percent of the total combined amounts obligated by 
        the unit for contracts and subcontracts shall be expended 
        with--
                    ``(A) small business concerns controlled by 
                socially and economically disadvantaged individuals and 
                women; and
                    ``(B) historically Black colleges and universities 
                and colleges and universities having a student body in 
                which more than 20 percent of the students are Hispanic 
                Americans or Native Americans.
            ``(2) Exception.--Paragraph (1) shall not apply to amounts 
        paid to a unit of general local government to the extent the 
        unit determines that the paragraph does not apply through a 
        process that provides for public participation.
            ``(3) Definitions.--For purposes of this subsection--
                    ``(A) the term `small business concern' has the 
                meaning such term has under section 3 of the Small 
                Business Act; and
                    ``(B) the term `socially and economically 
                disadvantaged individuals' has the meaning such term 
                has under section 8(d) of the Small Business Act and 
                relevant subcontracting regulations promulgated 
                pursuant to that section.
``Sec. 6702. Local Government Fiscal Assistance Fund
    ``(a) Administration of Fund.--The Department of Housing and Urban 
Development has a Local Government Fiscal Assistance Fund, which 
consists of amounts appropriated to the Fund.
    ``(b) Authorization of Appropriations.--There are authorized to be 
appropriated to the Fund $3,000,000,000 for fiscal years 1993 and 1994.
``Sec. 6703. Qualification for payment
    ``(a) In General.--Under regulations issued by the Secretary, a 
unit of general local government qualifies for a payment under this 
chapter for a payment period only after establishing to the 
satisfaction of the Secretary that--
            ``(1) the government will establish a trust fund in which 
        the government will deposit all payments received under this 
        chapter;
            ``(2) the government will use amounts in the trust fund 
        (including interest) during a reasonable period specified in 
        the regulations issued by the Secretary;
            ``(3) the government will expend the payments so received, 
        in accordance with the laws and procedures that are applicable 
        to the expenditure of revenues of the government;
            ``(4) if at least 25 percent of the pay of individuals 
        employed by the government in a public employee occupation is 
        paid out of the trust fund, individuals in the occupation any 
        part of whose pay is paid out of the trust fund will receive 
        pay at least equal to the prevailing rate of pay for 
        individuals employed in similar public employee occupations by 
        the government;
            ``(5) if at least 25 percent of the costs of a construction 
        project are paid out of the trust fund, laborers and mechanics 
        employed by contractors or subcontractors on the project will 
        receive pay at least equal to the prevailing rate of pay for 
        similar construction in the locality as determined by the 
        Secretary of Labor under the Act of March 3, 1931 (46 Stat. 
        1494 et seq.; popularly known as the Davis-Bacon Act), and the 
        Secretary of Labor shall act on labor standards under this 
        paragraph in a manner that is in accordance with Reorganization 
        Plan No. 14 of 1950 (64 Stat. 1267) and section 2 of the Act of 
        June 13, 1934 (48 Stat. 948);
            ``(6) the government will use accounting, audit, and fiscal 
        procedures that conform to guidelines which shall be prescribed 
        by the Secretary after consultation with the Comptroller 
        General of the United States;
            ``(7) after reasonable notice to the government, the 
        government will make available to the Secretary and the 
        Comptroller General of the United States, with the right to 
        inspect, records the Secretary reasonably requires to review 
        compliance with this chapter or the Comptroller General of the 
        United States reasonably requires to review compliance and 
        operations under section 6718(b); and
            ``(8) the government will make reports the Secretary 
        reasonably requires, in addition to the annual reports required 
        under section 6719(b).
    ``(b) Review by Governors.--A unit of general local government 
shall give the chief executive officer of the State in which the 
government is located an opportunity for review and comment before 
establishing compliance with subsection (a).
    ``(c) Sanctions for Noncompliance.--(1) If the Secretary decides 
that a unit of general local government has not complied substantially 
with subsection (a) or regulations prescribed under subsection (a), the 
Secretary shall notify the government. The notice shall state that if 
the government does not take corrective action by the 60th day after 
the date the government receives the notice, the Secretary will 
withhold additional payments to the government for the current payment 
period and later payment periods until the Secretary is satisfied that 
the government--
            ``(A) has taken the appropriate corrective action; and
            ``(B) will comply with subsection (a) and regulations 
        prescribed under subsection (a).
    ``(2) Before giving notice under paragraph (1), the Secretary shall 
give the chief executive officer of the unit of general local 
government reasonable notice and an opportunity for a proceeding.
    ``(3) The Secretary may make a payment to a unit of general local 
government notified under paragraph (1) only if the Secretary is 
satisfied that the government--
            ``(A) has taken the appropriate corrective action; and
            ``(B) will comply with subsection (a) and regulations 
        prescribed under subsection (a).
``Sec. 6704. State area allocations; allocations and payments to 
              territorial governments
    ``(a) Formula Allocation by State.--For each payment period, the 
Secretary shall allocate to each State out of the amount appropriated 
for the period under the authority of section 6702(b) (minus the 
amounts allocated to territorial governments under subsection (e) for 
the payment period) an amount bearing the same ratio to the amount 
appropriated (minus such amounts allocated under subsection (e)) as the 
amount allocated to the State under this section bears to the total 
amount allocated to all States under this section. The Secretary 
shall--
            ``(1) determine the amount allocated to the State under 
        subsection (b) or (c) of this section and allocate the larger 
        amount to the State; and
            ``(2) allocate the amount allocated to the State to units 
        of general local government in the State under sections 6705 
        and 6706.
    ``(b) General Formula.--(1) The amount allocated to a State under 
this subsection for a payment period is the amount bearing the same 
ratio to $5,300,000,000 as--
            ``(A) the population of the State, multiplied by the 
        general tax effort factor of the State (determined under 
        paragraph (2)), multiplied by the relative income factor of the 
        State (determined under paragraph (3)), multiplied by the 
        relative rate of the labor force unemployed in the State 
        (determined under paragraph (4)); bears to
            ``(B) the sum of the products determined under subclause 
        (A) of this paragraph for all States.
    ``(2) The general tax effort factor of a State for a payment period 
is--
            ``(A) the net amount of State and local taxes of the State 
        collected during the years used by the Secretary of Commerce in 
        the most recent Bureau of the Census general determination of 
        State and local taxes made before the beginning of the payment 
        period; divided by
            ``(B) the total income of individuals, as determined by the 
        Secretary of Commerce for national income accounts purposes, 
        attributed to the State for the same years.
    ``(3) The relative income factor of a State is a fraction in 
which--
            ``(A) the numerator is the per capita income of the United 
        States; and
            ``(B) the denominator is the per capita income of the 
        State.
    ``(4) The relative rate of the labor force unemployed in a State is 
a fraction in which--
            ``(A) the numerator is the percentage of the labor force of 
        the State that is unemployed (as determined by the Secretary of 
        Labor for general statistical purposes); and
            ``(B) the denominator is the percentage of the labor force 
        of the United States that is unemployed (as determined by the 
        Secretary of Labor for general statistical purposes).
    ``(c) Alternative Formula.--The amount allocated to a State under 
this subsection for a payment period is the total amount the State 
would receive if--
            ``(1) $1,166,666,667 were allocated among the States on the 
        basis of population by allocating to each State an amount 
        bearing the same ratio to the total amount to be allocated 
        under this paragraph as the population of the State bears to 
        the population of all States;
            ``(2) $1,166,666,667 were allocated among the States on the 
        basis of population inversely weighted for per capita income, 
        by allocating to each State an amount bearing the same ratio to 
        the total amount to be allocated under this paragraph as--
                    ``(A) the population of the State, multiplied by a 
                fraction in which--
                            ``(i) the numerator is the per capita 
                        income of all States; and
                            ``(ii) the denominator is the per capita 
                        income of the State; bears to
                    ``(B) the sum of the products determined under 
                subparagraph (A) for all States;
            ``(3) $600,000,000 were allocated among the States on the 
        basis of income tax collections by allocating to each State an 
        amount bearing the same ratio to the total amount to be 
        allocated under this paragraph as the income tax amount of the 
        State (determined under subsection (d)(1)) bears to the sum of 
        the income tax amounts of all States;
            ``(4) $600,000,000 were allocated among the States on the 
        basis of general tax effort by allocating to each State an 
        amount bearing the same ratio to the total amount to be 
        allocated under this paragraph as the general tax effort amount 
        of the State (determined under subsection (d)(2)) bears to the 
        sum of the general tax effort amounts of all States;
            ``(5) $600,000,000 were allocated among the States on the 
        basis of unemployment by allocating to each State an amount 
        bearing the same ratio to the total amount to be allocated 
        under this paragraph as--
                    ``(A) the labor force of the State, multiplied by a 
                fraction in which--
                            ``(i) the numerator is the percentage of 
                        the labor force of the State that is unemployed 
                        (as determined by the Secretary of Labor for 
                        general statistical purposes); and
                            ``(ii) the denominator is the percentage of 
                        the labor force of the United States that is 
                        unemployed (as determined by the Secretary of 
                        Labor for general statistical purposes);
                bears to
                    ``(B) the sum of the products determined under 
                subparagraph (A) for all States; and
            ``(6) $1,166,666,667 were allocated among the States on the 
        basis of urbanized population by allocating to each State an 
        amount bearing the same ratio to the total amount to be 
        allocated under this paragraph as the urbanized population of 
        the State bears to the urbanized population of all States. In 
        this paragraph, the term `urbanized population' means the 
        population of an area consisting of a central city or cities of 
        at least 50,000 inhabitants and the surrounding closely settled 
        area for the city or cities considered as an urbanized area by 
        the Secretary of Commerce for general statistical purposes.
    ``(d) Income Tax Amount and Tax Effort Amount.--(1) The income tax 
amount of a State for a payment period is 15 percent of the net amount 
collected during the calendar year ending before the beginning of the 
payment period from the tax imposed on the income of individuals by the 
State and described as a State income tax under section 164(a)(3) of 
the Internal Revenue Code of 1986 (26 U.S.C. 164(a)(3)). The income tax 
amount for a payment period shall be at least one percent but not more 
than 6 percent of the United States Government individual income tax 
liability attributed to the State for the taxable year ending during 
the last calendar year ending before the beginning of the payment 
period. The Secretary shall determine the Government income tax 
liability attributed to the State on the same basis as the Secretary of 
the Treasury determines that liability for general statistical 
purposes.
    ``(2) The general tax effort amount of a State for a payment period 
is the amount determined by multiplying--
            ``(A) the net amount of State and local taxes of the State 
        collected during the years used by the Secretary of Commerce in 
        the most recent Bureau of the Census general determination of 
        State and local taxes made before the beginning of the payment 
        period; by
            ``(B) the general tax effort factor of the State determined 
        under subsection (b)(2).
    ``(e) Allocation for Puerto Rico, Guam, American Samoa, and the 
Virgin Islands.--(1)(A) For each payment period for which funds are 
available for allocation under this chapter, the Secretary shall 
allocate to each territorial government an amount equal to the product 
of 1 percent of the amount of funds available for allocation multiplied 
by the applicable territorial percentage.
    ``(B) For the purposes of this paragraph, the applicable 
territorial percentage of a territory is equal to the quotient 
resulting from the division of the territorial population of such 
territory by the sum of the territorial population for all territories.
    ``(2) The governments of the territories shall make payments to 
local governments within their jurisdiction from sums received under 
this subsection as they consider appropriate.
    ``(3) For purposes of this subsection--
                    ``(A) the term `territorial government' means the 
                government of a territory;
                    ``(B) the term `territory' means Puerto Rico, Guam, 
                American Samoa, and the Virgin Islands; and
                    ``(C) the term `territorial population' means the 
                most recent population for each territory as determined 
                by the Bureau of Census.
``Sec. 6705. Local government allocations
    ``(a) Indian Tribes and Alaskan Natives Villages.--If there is in a 
State an Indian tribe or Alaskan native village having a recognized 
governing body carrying out substantial governmental duties and powers, 
the Secretary shall allocate to the tribe or village, out of the amount 
allocated to the State under section 6704, an amount bearing the same 
ratio to the amount allocated to the State as the population of the 
tribe or village bears to the population of the State. The Secretary 
shall allocate amounts under this subsection to Indian tribes and 
Alaskan native villages in a State before allocating amounts to units 
of general local government in the State under subsection (b).
    ``(b) Other Local Government Allocations.--(1) The Secretary shall 
allocate among the units of general local government in a State (other 
than units receiving allocations under subsection (a)) the amount 
allocated to the State under section 6704 (as that amount is reduced by 
allocations under subsection (a)). Of the amount to be allocated, the 
Secretary shall allocate a portion equal to \1/2\ of such amount in 
accordance with section 6706(1), and shall allocate a portion equal to 
\1/2\ of such amount in accordance with section 6706(2). A unit of 
general local government shall receive an amount equal to the sum of 
amounts allocated to the unit from each portion.
    ``(2) From each portion to be allocated to units of local 
government in a State under paragraph (1), the Secretary shall allocate 
to a unit an amount bearing the same ratio to the funds to be allocated 
as--
            ``(A) the population of the unit, multiplied by the general 
        tax effort factor of the unit (determined under paragraph (3)), 
        multiplied by the income gap of the unit (determined under 
        paragraph (4)), bears to
            ``(B) the sum of the products determined under subparagraph 
        (A) for all units in the State for which the income gap for 
        that portion under paragraph (4) is greater than zero.
    ``(3)(A) Except as provided in subparagraph (C), the general tax 
effort factor of a unit of general local government for a payment 
period is--
            ``(i) the adjusted taxes of the unit; divided by
            ``(ii) the total income attributed to the unit.
    ``(B) If the amount determined under subparagraphs (A)(i) and (ii) 
for a unit of general local government is less than zero, the general 
tax effort factor of the unit is deemed to be zero.
    ``(C)(i) Except as otherwise provided in this subparagraph, the 
adjusted taxes of a unit of general local government are the taxes 
imposed by the unit for public purposes (except employee and employer 
assessments and contributions to finance retirement and social 
insurance systems and other special assessments for capital outlay), as 
determined by the Secretary of Commerce for general statistical 
purposes and adjusted (under regulations of the Secretary) to exclude 
amounts properly allocated to education expenses.
    ``(ii) The Secretary shall, for purposes of clause (i), include 
that part of sales taxes transferred to a unit of general local 
government that are imposed by a county government in the geographic 
area of which is located the unit of general local government as taxes 
imposed by the unit for public purposes if--
            ``(I) the county government transfers any part of the 
        revenue from the taxes to the unit of general local government 
        without specifying the purpose for which the unit of general 
        local government may expend the revenue; and
            ``(II) the chief executive officer of the State notifies 
        the Secretary that the taxes satisfy the requirements of this 
        clause.
    ``(iii) The adjusted taxes of a unit of general local government 
shall not exceed the maximum allowable adjusted taxes for that unit.
    ``(iv) The maximum allowable adjusted taxes for a unit of general 
local government is the allowable adjusted taxes of the unit minus the 
excess adjusted taxes of the unit.
    ``(v) The allowable adjusted taxes of a unit of general government 
is the greater of--
            ``(I) the amount equal to 2.5, multiplied by the per capita 
        adjusted taxes of all units of general local government of the 
        same type in the State, multiplied by the population of the 
        unit; or
            ``(II) the amount equal to the population of the unit, 
        multiplied by the sum of the adjusted taxes of all units of 
        municipal local government in the State, divided by the sum of 
        the populations of all the units of municipal local government 
        in the State.
    ``(vi) The excess adjusted taxes of a unit of general local 
government is the amount equal to--
            ``(I) the adjusted taxes of the unit, minus
            ``(II) 1.5 multiplied by the allowable adjusted taxes of 
        the unit;
except that if this amount is less than zero then the excess adjusted 
taxes of the unit is deemed to be zero.
    ``(vii) For purposes of this subparagraph--
            ``(I) the term `per capita adjusted taxes of all units of 
        general local government of the same type' means the sum of the 
        adjusted taxes of all units of general local government of the 
        same type divided by the sum of the populations of all units of 
        general local government of the same type; and
            ``(II) the term `units of general local government of the 
        same type' means all townships if the unit of general local 
        government is a township, all municipalities if the unit of 
        general local government is a municipality, all counties if the 
        unit of general local government is a county, or all unified 
        city/county governments if the unit of general local government 
        is a unified city/county government.
    ``(4)(A) Except as provided in subparagraph (B), the income gap of 
a unit of general local government is--
            ``(i) the number which applies under section 6706, 
        multiplied by the per capita income of the State in which the 
        unit is located; minus
            ``(ii) the per capita income of the geographic area of the 
        unit.
    ``(B) If the amount determined under subparagraph (A) for a unit of 
general local government is less than zero, then the relative income 
factor of the unit is deemed to be zero.
    ``(c) Small Government Allocations.--If the Secretary decides that 
information available for a unit of general local government with a 
population below a number (of not more than 500) prescribed by the 
Secretary is inadequate, the Secretary may allocate to the unit, in 
lieu of any allocation under subsection (b) for a payment period, an 
amount bearing the same ratio to the total amount to be allocated under 
subsection (b) for the period for all units of general local government 
in the State as the population of the unit bears to the population of 
all units in the State.
``Sec. 6706. Income gap multiplier
    ``For purposes of determining the income gap of a unit of general 
local government under section 6705(b)(4)(A), the number which applies 
is--
            ``(1) 1.6, with respect to \1/2\ of any amount allocated 
        under section 6704 to the State in which the unit is located; 
        and
            ``(2) 1.2, with respect to the remainder of such amount.
``Sec. 6707. State variation of local government allocations
    ``(a) State Formula.--A State government may provide by law for the 
allocation of amounts among units of general local government in the 
State on the basis of population multiplied by the general tax effort 
factors or income gaps of the units of general local government 
(determined under sections 6705(a) and (b) or a combination of those 
factors. A State government providing for a variation of an allocation 
formula provided under section 6705(a) and (b) shall notify the 
Secretary of the variation by the 30th day before the beginning of the 
first payment period in which the variation applies. A variation 
shall--
            ``(1) provide for allocating the total amount allocated 
        under section 6705(a) and (b);
            ``(2) apply uniformly in the State; and
            ``(3) apply only to payment periods beginning before 
        October 1, 1995.
    ``(b) Certification.--A variation by a State government under this 
section may apply only if the Secretary certifies that the variation 
complies with this section. The Secretary may certify a variation only 
if the Secretary is notified of the variation at least 30 days before 
the first payment period in which the variation applies.
``Sec. 6708. Adjustments of local government allocations
    ``(a) Maximum Amount.--The amount allocated to a unit of general 
local government for a payment period may not exceed the adjusted taxes 
imposed by the unit of general local government as determined under 
section 6705(b)(3). Amounts in excess of adjusted taxes shall be paid 
to the Governor of the State in which the unit of local government is 
located.
    ``(b) De Minimis Allocations.--If the amount allocated to a unit of 
general local government (except an Indian tribe or an Alaskan native 
village) for a payment period would be less than $5,000 but for this 
subsection or is waived by the governing authority of the unit of 
general local government, the Secretary shall pay the amount to the 
Governor of the State in which the unit is located.
    ``(c) Use of Payments to States.--The Governor of a State shall use 
all amounts paid to the Governor under subsections (a) and (b) for 
public works projects in areas of the State where are located the units 
of general local government with respect to which amounts are paid 
under subsection (b).
``Sec. 6709. Information used in allocation formulas
    ``(a) Use of Most Recent Information.--Except as provided in this 
section, the Secretary shall use the most recent available information 
provided by the Secretary of Commerce and the Secretary of Labor before 
the beginning of the payment period to determine an allocation under 
this chapter. If the Secretary decides that the information is not 
current or complete enough to provide for a fair allocation, the 
Secretary may use additional information (including information based 
on estimates) as provided under regulations of the Secretary.
    ``(b) Population Data.--(1) The Secretary shall determine 
population on the same basis that the Secretary of Commerce determines 
resident population for general statistical purposes.
    ``(2) The Secretary shall request the Secretary of Commerce to 
adjust the population information provided to the Secretary as soon as 
practicable to include a reasonable estimate of the number of resident 
individuals not counted in the 1990 census or revisions of the census. 
The Secretary shall use the estimates in determining allocations for 
the payment period beginning after the Secretary receives the 
estimates. The Secretary shall adjust population information to reflect 
adjustments made under section 118 of the Act of October 1, 1980 
(Public Law 96-369, 94 Stat. 1357).
    ``(c) Additional Data Limitations.--The Secretary may not--
            ``(1) in determining an allocation for a payment period, 
        use information on tax collections for years more recent than 
        the years used by the Secretary of Commerce in the most recent 
        Bureau of the Census general determination of State and local 
        taxes made before the beginning of that period; or
            ``(2) consider a change in information used to determine an 
        allocation for a period of 60 months if the change--
                    ``(A) results from a major disaster declared by the 
                President under section 401 of The Robert T. Stafford 
                Disaster Relief and Emergency Assistance Act; and
                    ``(B) reduces the amount of an allocation.
``Sec. 6710. Public participation
    ``(a) Hearings.--(1) A unit of general local government expending 
payments under this chapter shall hold at least one public hearing on 
the proposed use of the payment in relation to its entire budget. At 
the hearing, persons shall be given an opportunity to provide written 
and oral views to the governmental authority responsible for enacting 
the budget and to ask questions about the entire budget and the 
relation of the payment to the entire budget. The government shall hold 
the hearing at a time and a place that allows and encourages public 
attendance and participation.
    ``(2) A unit of general local government holding a hearing required 
under this subsection or by the budget process of the government shall 
try to provide senior citizens and senior citizen organizations with an 
opportunity to present views at the hearing before the government makes 
a final decision on the use of the payment.
    ``(b) Disclosure of Information.--(1) By the 10th day before a 
hearing required under subsection (a)(1) is held, a unit of general 
local government shall--
            ``(A) make available for inspection by the public at the 
        principal office of the government a statement of the proposed 
        use of the payment and a summary of the proposed budget of the 
        government; and
            ``(B) publish in at least one newspaper of general 
        circulation the proposed use of the payment with the summary of 
        the proposed budget and a notice of the time and place of the 
        hearing.
    ``(2) By the 30th day after adoption of the budget under State or 
local law, the government shall--
            ``(A) make available for inspection by the public at the 
        principal office of the government a summary of the adopted 
        budget, including the proposed use of the payment; and
            ``(B) publish in at least one newspaper of general 
        circulation a notice that the information referred to in 
        subparagraph (A) is available for inspection.
    ``(c) Waivers of Requirements.--Under regulations of the Secretary, 
a requirement--
            ``(1) under subsection (a)(1) may be waived if the budget 
        process required under the applicable State or local law or 
        charter provisions--
                    ``(A) ensures the opportunity for public attendance 
                and participation contemplated by subsection (a); and
                    ``(B) includes a hearing on the proposed use of a 
                payment received under this chapter in relation to the 
                entire budget of the government; and
            ``(2) under subsection (b)(1)(B) and (2)(B) may be waived 
        if the cost of publishing the information would be unreasonably 
        burdensome in relation to the amount allocated to the 
        government from amounts available for payment under this 
        chapter, or if publication is otherwise impracticable.
    ``(d) Exception to 10-Day Limitation.--If the Secretary is 
satisfied that a unit of general local government will provide adequate 
notice of the proposed use of a payment received under this chapter, 
the 10-day period under subsection (b)(1) may be changed to the extent 
necessary to comply with applicable State or local law.
    ``(e) Application to Governments Without Budgets.--The Secretary 
shall prescribe regulations for applying this section to units of 
general local government that do not adopt budgets.
``Sec. 6711. Prohibited discrimination
    ``(a) General Prohibition.--No person in the United States shall be 
excluded from participating in, be denied the benefits of, or be 
subject to discrimination under, a program or activity of a unit of 
general local government because of race, color, national origin, or 
sex if the government receives a payment under this chapter.
    ``(b) Additional Prohibitions.--The following prohibitions and 
exemptions also apply to a program or activity of a unit of general 
local government if the government receives a payment under this 
chapter:
            ``(1) A prohibition against discrimination because of age 
        under the Age Discrimination Act of 1975.
            ``(2) A prohibition against discrimination against an 
        otherwise qualified handicapped individual under section 504 of 
        the Rehabilitation Act of 1973.
            ``(3) A prohibition against discrimination because of 
        religion, or an exemption from that prohibition, under the 
        Civil Rights Act of 1964 or title VIII of the Act of April 11, 
        1968 (popularly known as the Civil Rights Act of 1968).
    ``(c) Limitations on Applicability of Prohibitions.--Subsections 
(a) and (b) do not apply if the government shows, by clear and 
convincing evidence, that a payment received under this chapter is not 
used to pay for any part of the program or activity with respect to 
which the allegation of discrimination is made.
    ``(d) Investigation Agreements.--The Secretary shall try to make 
agreements with heads of agencies of the United States Government and 
State agencies to investigate noncompliance with this section. An 
agreement shall--
            ``(1) describe the cooperative efforts to be taken 
        (including sharing civil rights enforcement personnel and 
        resources) to obtain compliance with this section; and
            ``(2) provide for notifying immediately the Secretary of 
        actions brought by the United States Government or State 
        agencies against a unit of general local government alleging a 
        violation of a civil rights law or a regulation prescribed 
        under a civil rights law.
``Sec. 6712. Discrimination proceedings
    ``(a) Notice of Noncompliance.--By the 10th day after the Secretary 
makes a finding of discrimination or receives a holding of 
discrimination about a unit of general local government, the Secretary 
shall submit a notice of noncompliance to the government. The notice 
shall state the basis of the finding or holding.
    ``(b) Informal Presentation of Evidence.--A unit of general local 
government may present evidence informally to the Secretary within 30 
days after the government receives a notice of noncompliance from the 
Secretary. Except as provided in subsection (e), the government may 
present evidence on whether--
            ``(1) a person in the United States has been excluded or 
        denied benefits of, or discriminated against under, the program 
        or activity of the government, in violation of section 6711(a);
            ``(2) the program or activity of the government violated a 
        prohibition described in section 6711(b); and
            ``(3) any part of that program or activity has been paid 
        for with a payment received under this chapter.
    ``(c) Temporary Suspension of Payments.--By the end of the 30-day 
period under subsection (b), the Secretary shall decide whether the 
unit of general local government has not complied with section 6711 (a) 
or (b), unless the government has entered into a compliance agreement 
under section 6714. If the Secretary decides that the government has 
not complied, the Secretary shall notify the government of the decision 
and shall suspend payments to the government under this chapter unless, 
within 10 days after the government receives notice of the decision, 
the government--
            ``(1) enters into a compliance agreement under section 
        6714; or
            ``(2) requests a proceeding under subsection (d)(1).
    ``(d) Administrative Review of Suspensions.--(1) A proceeding 
requested under subsection (c)(2) shall begin by the 30th day after the 
Secretary receives a request for the proceeding. The proceeding shall 
be before an administrative law judge appointed under section 3105 of 
title 5. By the 30th day after the beginning of the proceeding, the 
judge shall issue a preliminary decision based on the record at the 
time on whether the unit of general local government is likely to 
prevail in showing compliance with section 6711 (a) or (b).
    ``(2) If the administrative law judge decides at the end of a 
proceeding under paragraph (1) that the unit of general local 
government has--
            ``(A) not complied with section 6711 (a) or (b), the judge 
        may order payments to the government under this chapter 
        terminated; or
            ``(B) complied with section 6711 (a) or (b), a suspension 
        under section 6713(a)(1)(A) shall be discontinued promptly.
    ``(3) An administrative law judge may not issue a preliminary 
decision that the government is not likely to prevail if the judge has 
issued a decision described in paragraph (2)(A).
    ``(e) Basis for Review.--In a proceeding under subsections (b) 
through (d) on a program or activity of a unit of general local 
government about which a holding of discrimination has been made, the 
Secretary or administrative law judge may consider only whether a 
payment under this chapter was used to pay for any part of the program 
or activity. The holding of discrimination is conclusive. If the 
holding is reversed by an appellate court, the Secretary or judge shall 
end the proceeding.
``Sec. 6713. Suspension and termination of payments in discrimination 
              proceedings
    ``(a) Imposition and Continuation of Suspensions.--(1) The 
Secretary shall suspend payment under this chapter to a unit of general 
local government--
            ``(A) if an administrative law judge appointed under 
        section 3105 of title 5 issues a preliminary decision in a 
        proceeding under section 6712(d)(1) that the government is not 
        likely to prevail in showing compliance with section 6711 (a) 
        and (b);
            ``(B) if the administrative law judge decides at the end of 
        the proceeding that the government has not complied with 
        section 6711 (a) or (b), unless the government makes a 
        compliance agreement under section 6714 by the 30th day after 
        the decision; or
            ``(C) if required under section 6712(c).
    ``(2) A suspension already ordered under paragraph (1)(A) continues 
in effect if the administrative law judge makes a decision under 
paragraph (1)(B).
    ``(b) Lifting of Suspensions and Terminations.--If a holding of 
discrimination is reversed by an appellate court, a suspension or 
termination of payments in a proceeding based on the holding shall be 
discontinued.
    ``(c) Resumption of Payments Upon Attaining Compliance.--The 
Secretary may resume payment to a unit of general local government of 
payments suspended by the Secretary only--
            ``(1) as of the time of, and under the conditions stated 
        in--
                    ``(A) the approval by the Secretary of a compliance 
                agreement under section 6714(a)(1); or
                    ``(B) a compliance agreement entered into by the 
                Secretary under section 6714(a)(2);
            ``(2) if the government complies completely with an order 
        of a United States court, a State court, or administrative law 
        judge that covers all matters raised in a notice of 
        noncompliance submitted by the Secretary under section 6712(a);
            ``(3) if a United States court, a State court, or an 
        administrative law judge decides (including a judge in a 
        proceeding under section 6712(d)(1)), that the government has 
        complied with sections 6711 (a) and (b); or
            ``(4) if a suspension is discontinued under subsection (b).
    ``(d) Payment of Damages as Compliance.--For purposes of subsection 
(c)(2), compliance by a government may consist of the payment of 
restitution to a person injured because the government did not comply 
with section 6711 (a) or (b).
    ``(e) Resumption of Payments Upon Reversal by Court.--The Secretary 
may resume payment to a unit of general local government of payments 
terminated under section 6712(d)(2)(A) only if the decision resulting 
in the termination is reversed by an appellate court.
``Sec. 6714. Compliance agreements
    ``(a) Types of Compliance Agreements.--A compliance agreement is an 
agreement--
            ``(1) approved by the Secretary, between the governmental 
        authority responsible for prosecuting a claim or complaint that 
        is the basis of a holding of discrimination and the chief 
        executive officer of the unit of general local government that 
        has not complied with section 6711 (a) or (b); or
            ``(2) between the Secretary and the chief executive 
        officer.
    ``(b) Contents of Agreements.--A compliance agreement--
            ``(1) shall state the conditions the unit of general local 
        government has agreed to comply with that would satisfy the 
        obligations of the government under sections 6711 (a) and (b);
            ``(2) shall cover each matter that has been found not to 
        comply, or would not comply, with section 6711 (a) or (b); and
            ``(3) may be a series of agreements that dispose of those 
        matters.
    ``(c) Availability of Agreements to Parties.--The Secretary shall 
submit a copy of a compliance agreement to each person who filed a 
complaint referred to in section 6716(b), or, if an agreement under 
subsection (a)(1), each person who filed a complaint with a 
governmental authority, about a failure to comply with section 6711 (a) 
or (b). The Secretary shall submit the copy by the 15th day after an 
agreement is made. However, if the Secretary approves an agreement 
under subsection (a)(1) after the agreement is made, the Secretary may 
submit the copy by the 15th day after approval of the agreement.
``Sec. 6715. Enforcement by the Attorney General of prohibitions on 
              discrimination
    ``The Attorney General may bring a civil action in an appropriate 
district court of the United States against a unit of general local 
government that the Attorney General has reason to believe has engaged 
or is engaging in a pattern or practice in violation of section 6711 
(a) or (b). The court may grant--
            ``(1) a temporary restraining order;
            ``(2) an injunction; or
            ``(3) an appropriate order to ensure enjoyment of rights 
        under section 6711 (a) or (b), including an order suspending, 
        terminating, or requiring repayment of, payments under this 
        chapter or placing additional payments under this chapter in 
        escrow pending the outcome of the action.
``Sec. 6716. Civil action by a person adversely affected
    ``(a) Authority for Private Suits in Federal or State Court.--If a 
unit of general local government, or an officer or employee of a unit 
of general local government acting in an official capacity, engages in 
a practice prohibited by this chapter, a person adversely affected by 
the practice may bring a civil action in an appropriate district court 
of the United States or a State court of general jurisdiction. Before 
bringing an action under this section, the person must exhaust 
administrative remedies under subsection (b).
    ``(b) Administrative Remedies Required To Be Exhausted.--A person 
adversely affected shall file an administrative complaint with the 
Secretary or the head of another agency of the United States Government 
or the State agency with which the Secretary has an agreement under 
section 6711(d). Administrative remedies are deemed to be exhausted by 
the person after the 90th day after the complaint was filed if the 
Secretary, the head of the Government agency, or the State agency--
            ``(1) issues a decision that the government has not failed 
        to comply with this chapter; or
            ``(2) does not issue a decision on the complaint.
    ``(c) Authority of Court.--In an action under this section, the 
court--
            ``(1) may grant--
                    ``(A) a temporary restraining order;
                    ``(B) an injunction; or
                    ``(C) another order, including suspension, 
                termination, or repayment of, payments under this 
                chapter or placement of additional payments under this 
                chapter in escrow pending the outcome of the action; 
                and
            ``(2) to enforce compliance with section 6711 (a) or (b), 
        may allow a prevailing party (except the United States 
        Government) a reasonable attorney's fee.
    ``(d) Intervention by Attorney General.--In an action under this 
section to enforce compliance with section 6711 (a) or (b), the 
Attorney General may intervene in the action if the Attorney General 
certifies that the action is of general public importance. The United 
States Government is entitled to the same relief as if the Government 
had brought the action and is liable for the same fees and costs as a 
private person.
``Sec. 6717. Judicial review
    ``(a) Appeals in Federal Court of Appeals.--A unit of general local 
government which receives notice from the Secretary about withholding 
payments under section 6703(c), suspending payments under section 
6713(a)(1)(B), or terminating payments under section 6712(d)(2)(A), may 
apply for review of the action of the Secretary by filing a petition 
for review with the court of appeals of the United States for the 
circuit in which the government is located. The petition shall be filed 
by the 60th day after the date the notice is received. The clerk of the 
court shall immediately send a copy of the petition to the Secretary 
and the Attorney General.
    ``(b) Filing of Record of Administrative Proceeding.--The Secretary 
shall file with the court a record of the proceeding on which the 
Secretary based the action. The court may consider only objections to 
the action of the Secretary that were presented before the Secretary.
    ``(c) Court Action.--The court may affirm, change, or set aside any 
part of the action of the Secretary. The findings of fact by the 
Secretary are conclusive if supported by substantial evidence in the 
record. If a finding is not supported by substantial evidence in the 
record, the court may remand the case to the Secretary to take 
additional evidence. Upon such a remand, the Secretary may make new or 
modified findings and shall certify additional proceedings to the 
court.
    ``(d) Review Only by Supreme Court.--A judgment of a court under 
this section may be reviewed only by the Supreme Court under section 
1254 of title 28.
``Sec. 6718. Audits, investigations, and reviews
    ``(a) Independent Audit.--(1) Except as provided in this section, a 
unit of general local government that receives a payment under this 
chapter shall have an independent audit made of the financial 
statements of the government at least as often as is required by 
paragraph (2) to determine compliance with this chapter. The audit 
shall be carried out under generally accepted government auditing 
standards issued by the Comptroller General of the United States.
    ``(2) Paragraph (1) does not apply to a unit of general local 
government for a fiscal year in which the government receives less than 
$25,000 under this chapter. A unit of general local government which 
receives at least $25,000 but not more than $100,000 under this chapter 
for a fiscal year shall have an audit made in accordance with paragraph 
(1) at least once every 3 years. A government which receives more than 
$100,000 under this chapter for a fiscal year shall have an audit made 
in accordance with paragraph (1) for such fiscal year, except that, if 
the government operates on a biennial fiscal period, such audit may be 
made biennially but shall cover the financial statement or statements 
for, and compliance with the requirements of the chapter during, both 
years within such period.
    ``(3) An audit of financial statements of a unit of general local 
government carried out under another law of the United States for a 
fiscal year is deemed to be in compliance with paragraph (1) for that 
year if the audit substantially complies with the requirements of 
paragraph (1).
    ``(b) Waiver by Local Government.--A unit of general local 
government may waive application of subsection (a)(1) if--
            ``(1) the financial statements of the government are 
        audited by independent auditors under State or local law at 
        least as often as would be required by subsection (a)(2);
            ``(2) the government certifies that the audit is carried 
        out under generally accepted auditing standards issued by the 
        Comptroller General of the United States;
            ``(3) the auditing provisions of the State or local law are 
        applicable to the payment period to which the waiver applies; 
        and
            ``(4) the government submits to the Secretary a brief 
        description of the auditing standards used under the relevant 
        State or local law and specification of the payment period to 
        which the waiver applies.
    ``(c) Waiver by Secretary.--Under regulations of the Secretary, the 
Secretary may waive any requirement under subsection (a)(1) or (b) for 
a unit of general local government for a fiscal year if the Secretary 
decides that the financial statements of the government for the year--
            ``(1) cannot be audited, and the government shows 
        substantial progress in making the statements auditable; or
            ``(2) have been audited by a State agency that does not 
        follow generally accepted auditing standards issued by the 
        Comptroller General of the United States or that is not 
        independent, and the State agency shows progress in meeting 
        those auditing standards or in becoming independent.
    ``(d) Series of Audits.--A series of audits carried out over a 
period of not more than 3 years covering the total amount in the 
financial accounts of a unit of general local government is deemed to 
be a single audit under subsections (a)(1) and (b) of this section.
    ``(e) Audit Opinion.--An opinion of an audit carried out under this 
section shall be provided to the Secretary in the form and at times 
required by the Secretary. No later than 30 days following the 
completion of the audit, the unit of general local government shall 
make the audit report available for public inspection.
    ``(f) Investigations by Secretary.--(1) The Secretary shall 
maintain regulations providing reasonable and specific time limits for 
the Secretary to--
            ``(A) carry out an investigation and make a finding after 
        receiving a complaint referred to in section 6716(b), a 
        determination by a State or local administrative agency, or 
        other information about a possible violation of this chapter;
            ``(B) carry out audits and reviews (including 
        investigations of allegations) about possible violations of 
        this chapter; and
            ``(C) advise a complainant of the status of an audit, 
        investigation, or review of an allegation by the complainant of 
        a violation of section 6711 (a) or (b) or other provision of 
        this chapter.
    ``(2) The maximum time limit under paragraph (1)(A) is 90 days.
    ``(g) Reviews by Comptroller General.--The Comptroller General of 
the United States shall carry out reviews of the activities of the 
Secretary, State governments, and units of general local government 
necessary for the Congress to evaluate compliance and operations under 
this chapter.
``Sec. 6719. Reports
    ``(a) Reports by Secretary to Congress.--Before June 2 of each 
year, the Secretary personally shall report to the Congress on--
            ``(1) the status and operation of the Local Government 
        Fiscal Assistance Fund during the prior fiscal year; and
            ``(2) the administration of this chapter, including a 
        complete and detailed analysis of--
                    ``(A) actions taken to comply with sections 6711 
                through 6715, including a description of the kind and 
                extent of noncompliance and the status of pending 
                complaints;
                    ``(B) the extent to which units of general local 
                government receiving payments under this chapter have 
                complied with sections 6702 and 6718(a), (b), and (d), 
                including a description of the kind and extent of 
                noncompliance and actions taken to ensure the 
                independence of audits conducted under section 6718(a), 
                (b), and (d);
                    ``(C) the way in which payments under this chapter 
                have been distributed in the jurisdictions receiving 
                payments; and
                    ``(D) significant problems in carrying out this 
                chapter and recommendations for legislation to remedy 
                the problems.
    ``(b) Reports by Units of General Local Government to Secretary.--
(1) At the end of each fiscal year, each unit of general local 
government which received a payment under this chapter for the fiscal 
year shall submit a report to the Secretary. The report shall be 
submitted in the form and at a time prescribed by the Secretary and 
shall be available to the public for inspection. The report shall 
state--
            ``(A) the amounts and purposes for which the payment has 
        been appropriated, expended, or obligated in the fiscal year;
            ``(B) the relationship of the payment to the relevant 
        functional items in the budget of the government; and
            ``(C) the differences between the actual and proposed use 
        of the payment.
    ``(2) The Secretary shall provide a copy of a report submitted 
under paragraph (1) by a unit of general local government to the chief 
executive officer of the State in which the government is located. The 
Secretary shall provide the report in the manner and form prescribed by 
the Secretary.
    ``(c) Regulations.--The Secretary shall prescribe regulations for 
applying this section to units of general local government that do not 
adopt budgets.
``Sec. 6720. Definitions and application
    ``(a) Definitions.--In this chapter--
            ``(1) `unit of general local government' means--
                    ``(A) a county, township, city, or political 
                subdivision of a county, township, or city, that is a 
                unit of general local government as determined by the 
                Secretary of Commerce for general statistical purposes; 
                and
                    ``(B) the District of Columbia and the recognized 
                governing body of an Indian tribe or Alaskan Native 
                village that carries out substantial governmental 
                duties and powers;
            ``(2) `payment period' means each one-year period beginning 
        on October 1 of 1992 and 1993;
            ``(3) `State and local taxes' means taxes imposed by a 
        State government or unit of general local government or other 
        political subdivision of a State government for public purposes 
        (except employee and employer assessments and contributions to 
        finance retirement and social insurance systems and other 
        special assessments for capital outlay) as determined by the 
        Secretary of Commerce for general statistical purposes;
            ``(4) `State' means any of the several States and the 
        District of Columbia;
            ``(5) `income' means the total money income received from 
        all sources as determined by the Secretary of Commerce for 
        general statistical purposes;
            ``(6) `per capita income' means--
                    ``(A) in the case of the United States, the income 
                of the United States divided by the population of the 
                United States;
                    ``(B) in the case of a State, the income of that 
                State, divided by the population of that State; and
                    ``(C) in the case of a unit of general local 
                government, the income of that unit of general local 
                government divided by the population of the unit of 
                general local government;
            ``(7) `finding of discrimination' means a decision by the 
        Secretary about a complaint described in section 6716(b), a 
        decision by a State or local administrative agency, or other 
        information (under regulations prescribed by the Secretary) 
        that it is more likely than not that a unit of general local 
        government has not complied with section 6711 (a) or (b);
            ``(8) `holding of discrimination' means a holding by a 
        United States court, a State court, or an administrative law 
        judge appointed under section 3105 of title 5, that a unit of 
        general local government expending amounts received under this 
        chapter has--
                    ``(A) excluded a person in the United States from 
                participating in, denied the person the benefits of, or 
                subjected the person to discrimination under, a program 
                or activity because of race, color, national origin, or 
                sex; or
                    ``(B) violated a prohibition against discrimination 
                described in section 6711(b); and
            ``(9) `public safety' includes--
                    ``(A) crime and substance abuse prevention 
                activities;
                    ``(B) the establishment of neighborhood satellite 
                police precincts for the purpose of enhancing 
                community-based policing; and
            ``(10) `Secretary' means the Secretary of Housing and Urban 
        Development.
    ``(b) Treatment of Subsumed Areas.--If the entire geographic area 
of a unit of general local government is located in a larger entity, 
the unit of general local government is deemed to be located in the 
larger entity. If only part of the geographic area of a unit is located 
in a larger entity, each part is deemed to be located in the larger 
entity and to be a separate unit of general local government in 
determining allocations under this chapter. Except as provided in 
regulations prescribed by the Secretary, the Secretary shall make all 
data computations based on the ratio of the estimated population of the 
part to the population of the entire unit of general local government.
    ``(c) Boundary and Other Changes.--If a boundary line change, a 
State statutory or constitutional change, annexation, a governmental 
reorganization, or other circumstance results in the application of 
sections 6704 through 6708 in a way that does not carry out the 
purposes of sections 6701 through 6708, the Secretary shall apply 
sections 6701 through 6708 under regulations of the Secretary in a way 
that is consistent with those purposes.''.
    (b) Deficit Neutrality.--Any appropriation to carry out the 
amendment made by this Act to title 31, United States Code, for fiscal 
year 1993 or 1994 shall be offset by cuts elsewhere in appropriations 
for that fiscal year.

SEC. 4. CLERICAL AMENDMENT.

    The table of chapters at the beginning of subtitle V of title 31, 
United States Code, is amended by adding at after the item relating to 
chapter 65 the following:

``67. Federal Payments......................................    6701''.

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