[Congressional Bills 103th Congress]
[From the U.S. Government Publishing Office]
[S. 874 Introduced in Senate (IS)]
103d CONGRESS
1st Session
S. 874
To reauthorize Public Law 81-874 (Impact Aid), and for other purposes.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
May 4 (legislative day, April 19), 1993
Mr. Pressler (for himself, Mr. Warner, Mr. Daschle, Mr. Krueger, Mr.
Shelby, Mr. Gorton, Mr. Burns, and Mr. Campbell) introduced the
following bill; which was read twice and referred to the Committee on
Labor and Human Resources
_______________________________________________________________________
A BILL
To reauthorize Public Law 81-874 (Impact Aid), and for other purposes.
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 ``Impact Aid Reauthorization Act of
1993''.
SEC. 2. REAUTHORIZATION.
Public Law 81-874 (20 U.S.C. 236 et seq.) is amended to read as
follows:
``TITLE I--FINANCIAL ASSISTANCE FOR LOCAL EDUCATIONAL AGENCIES IN AREAS
AFFECTED BY FEDERAL ACTIVITY
``SEC. 101. DECLARATION OF POLICY.
``(a) Policy.--In recognition of the responsibility of the United
States to provide an educational program to local educational agencies
impacted by the Federal presence of Federal land or that serve
dependents of federally connected personnel, including children of
those in the uniformed service, children residing on Federal Indian
trust land and children residing on nontaxable federally subsidized
low-rent housing projects, it shall be the policy of the United States
to acknowledge that--
``(1) the need to ensure fair access and equitable
treatment of our Nation's children in the area of free public
education;
``(2) such fair access and equitable treatment of our
Nation's children is hampered when Federal ownership of real
property or Federal activities within a community adversely
affect any or all of the basic revenue sources which local
educational agencies depend upon for such fair access and
equitable treatment;
``(3) such local educational agencies are entitled to
relief from the unique burdens placed upon them by the Federal
ownership of real property or Federal activity in the form of
compensation for the basic educational program of the federally
connected student;
``(4) education is central to our Nation's quality of life
and the survival of our Nation's democratic society;
``(5) education is at the heart of our Nation's economic
strength and security, creativity, investment in the sciences,
and the perpetuation of our Nation's cultural values;
``(6) education is the key to United States international
competitiveness;
``(7) every child should be given an equal opportunity to
learn;
``(8) the United States presence creates a responsibility
to assure fair access and equitable educational opportunity for
all children residing on Federal land or otherwise affected
adversely by the Federal presence;
``(9) the United States presence should not reduce the
ability of a school district to achieve our Nation's education
goals; and
``(10) the failure to fully compensate such affected local
educational agencies, or the reduction in such compensation,
places the education and future of such students in jeopardy.
``(b) Declaration of Policy.--The Congress declares it to be the
policy of the United States to provide financial assistance (as set
forth in the following sections of this Act) for those local
educational agencies upon which the United States has placed financial
burdens by reason of the fact that--
``(1) the revenues available to such agencies from State
and local sources have been reduced as the result of--
``(A) the acquisition of real property by the
United States; and
``(B) providing retail services on the property
owned by the United States;
``(2) such agencies provide education for children residing
on Federal property;
``(3) such agencies provide education for children whose
parents are employed on Federal property; or
``(4) there has been a sudden and substantial increase in
school attendance as the result of Federal activities.
``(c) Authorization of Appropriations.--
``(1) In general.--There are authorized to be appropriated
$900,000,000 for fiscal year 1994, and such sums as may be
necessary for each of the 4 succeeding fiscal years, to carry
out this Act.
``(2) Contingency fund.--There are authorized to be
appropriated $14,000,000 for fiscal year 1994, which shall be
deposited into the contingency fund established under section
202.
``(d) Reservations.--
``(1) Federal acquisition of real property.--The Secretary
shall reserve 2.5 percent of the amount appropriated pursuant
to the authority of subsection (c)(1) in each fiscal year to
carry out section 102.
``(2) Department of education contingency fund.--Beginning
in fiscal year 1995 and in each succeeding fiscal year through
fiscal year 1998, the Secretary shall annually reserve from the
amount appropriated pursuant to the authority of subsection
(c)(1) and deposit into the contingency fund established under
section 202 an amount which is necessary to make the balance of
such contingency fund in such fiscal year (prior to withdrawal
of any funds from such fund for such fiscal year) equal to 2
percent of the amount appropriated pursuant to the authority of
subsection (c)(1) for such fiscal year.
``(3) Reservation for heavily impacted high need areas.--
The Secretary, based on the annual estimate developed pursuant
to section 103(d)(3)(D), shall annually reserve from the amount
appropriated pursuant to the authority of subsection (c)(1) in
each fiscal year the amount necessary to carry out the
provisions of section 103(d)(3).
``(e) Forward Funding.--
``(1) Availability for obligation.--For the purpose of
affording adequate notice of funding available under this Act,
amounts appropriated in an appropriation Act for any fiscal
year to carry out this Act shall become available for
obligation on July 1 of that fiscal year.
``(2) Effectuation of forward funding.--In order to effect
a transition to the forward funding method of timing
appropriation action described in paragraph (1), there are
authorized to be appropriated, in an appropriation Act or Acts
for the same fiscal year, two separate appropriations to carry
out this Act, the first of which shall not be subject to
paragraph (1).
``SEC. 102. FEDERAL ACQUISITION OF REAL PROPERTY.
``(a) In General.--Where the Secretary, after consultation with any
local educational agency and with the appropriate State educational
agency, determines for any fiscal year ending prior to October 1, 1998,
that the United States owns Federal property in the school district of
such local educational agency, and that such property--
``(1) has been acquired by the United States since 1938;
``(2) was not acquired by exchange for other Federal
property in the school district which the United States owned
before 1939; and
``(3) had an assessed value (determined as of the time or
times when so acquired) aggregating 10 percent or more of the
assessed value of all real property in the school district
(similarly determined as of the time or times when such Federal
property was so acquired);
then such local educational agency shall be entitled to receive for
such fiscal year such amount as, in the judgment of the Secretary, is
equal to the continuing Federal responsibility for the additional
financial burden with respect to current expenditures placed on such
agency by such acquisition of property (in accordance with section
222.98 of title 34, Code of Federal Regulations (as in effect on
December 5, 1991), and without regard to the provisions of section
222.101 of title 34, Code of Federal Regulations (as in effect on
December 5, 1991)). Such entitled amount shall be reduced by any
revenue received during the preceding fiscal year by the local
educational agency that was generated directly from the Federal
property or activities in or on that property and was exclusively
provided to such local educational agency.
``(b) Applicability to the Tennessee Valley Authority Act.--For the
purposes of this section any real property with respect to which
payments are being made under section 13 of the Tennessee Valley
Authority Act of 1933, as amended, shall not be regarded as Federal
property.
``(c) Consolidated Districts.--Where the school district of any
local educational agency shall have been formed at any time after 1938
by the consolidation of two or more former school districts, such
agency may elect (at the time such agency files application under
section 105) for any fiscal year to have--
``(1) the eligibility of such local educational agency; and
``(2) the amount which such agency shall be entitled to
receive,
determined under this section only with respect to such of the former
school districts comprising such consolidated school districts as the
agency shall designate in such election.
``(d) Ownership.--The United States shall be deemed to own Federal
property for the purposes of this Act where--
``(1) prior to the transfer of Federal property, the United
States owned Federal property meeting the requirements of
paragraphs (1), (2), and (3) of subsection (a); and
``(2) the United States transfers a portion of the property
referred to in paragraph (1) to another nontaxable entity, and
the United States--
``(A) requires that the property be used in
perpetuity for the public purposes for which it was
conveyed;
``(B) requires the grantee of the property to
report to the Federal Government (or its agent) setting
forth information on the use of the property;
``(C) prohibits the sale, lease assignment or other
disposal of the property unless to another eligible
government agency and with the approval of the Federal
Government (or its agent); and
``(D) reserved to the Federal Government a right of
reversion at any time the Federal Government (or its
agent) deems it necessary for the national defense.
``(e) Special Rule.--Beginning with fiscal year 1991, any school
district which (1) as demonstrated by written evidence from the United
States Forest Service satisfactory to the Secretary, contains between
50,000 and 55,000 acres of land that has been acquired by the United
States Forest Service between 1915 and 1990; and (2) serves a county
chartered by State law in 1875, shall be deemed to have met the
requirements of subsection (a)(3).
``(f) Hold Harmless.--No local educational agency which is eligible
for a payment under this section in any fiscal year shall receive a
payment under this section in such fiscal year in an amount which is
less than 90 percent of the amount such agency received under this
section in the preceding fiscal year.
``(g) Additional Information.--Whenever the Secretary, after
receiving an application from any local educational agency under this
section requests further information from the local educational agency
for the Secretary's review of the application, the Secretary shall take
such measures as are necessary to ensure that all information is
gathered in a reasonable time, pursuant to regulations promulgated by
the Secretary, in order to ensure that payments under this section for
that fiscal year are provided to all applicant local educational
agencies not later than December 1 of such fiscal year.
``SEC. 103. FEDERALLY CONNECTED CHILDREN.
``(a) Computation of Payment.--
``(1) In general.--For the purpose of computing the amount
to which a local educational agency is to be paid under this
section for any fiscal year, the Secretary shall first
determine the number of children who were in average daily
attendance at the schools of such agency, and for whom such
agency provided free public education, during the preceding
fiscal year, and--
``(A) while residing on Federal property did so
with a parent employed on Federal property situated (i)
in whole or in part in the county in which the school
district of such agency is located, or (ii) if not in
such county, in whole or in part in the same State as
the school district of such agency;
``(B) while residing on Federal property had a
parent who was on active duty in the uniformed services
(as defined in section 101 of title 37, United States
Code);
``(C) while in attendance at such schools, either--
``(i) resided on Federal property;
``(ii) resided with a parent employed on
Federal property situated (I) in whole or in
part in the county in which the school district
of such agency is located, or in whole or in
part in the school district of such agency if
the school district is located in more than one
county, or (II) if not in such county or
district, in whole or in part in the same State
as the school district of such agency; or
``(iii) resided in any low-rent housing
project as defined in section 204(a)(1)(C) of
this Act; or
``(D) had a parent who was on active duty in the
uniformed services (as defined in section 101 of title
37, United States Code).
``(2) Children residing on indian lands.--In making a
determination under paragraph (1)(B) with respect to a local
educational agency for any fiscal year, the Secretary shall
include the number of children who were in average daily
attendance at the schools of such agency, and for whom such
agency provided free public education, during the preceding
fiscal year, and who, while in attendance at such schools,
resided on Indian lands, as described in subparagraph (A) of
section 204(1).
``(b) Eligibility for Payments.--
``(1) In general.--Except as provided in paragraph (2), no
local educational agency shall be entitled to receive a payment
for any fiscal year with respect to a number of children
determined under subsection (a), unless--
``(A) the number of children so determined with
respect to such agency amounts to--
``(i) at least 400 such children; or
``(ii) a number of such children which
equals at least 3 percent of the total number
of children who were in average daily
attendance, during the preceding year, at the
schools of such agency and for whom such agency
provided free public education,
whichever is the lesser;
``(B) such local educational agency is making a tax
effort, or complying with other State fiscal
requirements, required for eligibility for State
education funding; and
``(C) such local educational agency--
``(i) is certified or accredited by a--
``(I) State educational agency or
regional accrediting association
recognized by the Secretary, or is a
candidate in good standing for such
certification or accreditation under
the rules of the State educational
agency or regional accrediting
association; or
``(II) tribal department of
education if such certification or
accreditation is accepted by a
generally recognized regional or State
certification or accreditation agency;
or
``(ii) demonstrates to the satisfaction of
the Secretary that credits achieved by the
students of such local educational agency are,
or will be, accepted at grade level by a State
or regional accrediting agency or association.
``(2) Continuing eligibility; special rules.--(A) If a
local educational agency is eligible for a payment for any
fiscal year by the operation of paragraph (1)(A)(ii), such
agency shall continue to be so eligible for the 2 succeeding
fiscal years even if such agency fails to meet the requirement
of such paragraph during such succeeding fiscal years, except
that the number of children determined for the second such
succeeding fiscal year with respect to such agency for the
purpose of subsection (c) shall not exceed 50 percent of the
number of children determined with respect to such agency for
the purpose of such paragraph for the last fiscal year which
such agency was so eligible.
``(B) If the Secretary determines with respect to any local
educational agency for any fiscal year that--
``(i) such agency does not meet the requirement of
paragraph (1)(A)(ii); and
``(ii) the application of such requirement, because
of exceptional circumstances, would defeat the purposes
of this title,
then the Secretary is authorized to waive such requirement with
respect to such agency.
``(c) Allotment Formula; Determination of Equal Opportunity Cost.--
``(1) Allotment formula.--The amount of the payment to
which a local educational agency shall be entitled to receive
under this section is equal to such agency's equal opportunity
cost. A local educational agency's equal opportunity cost shall
be determined as follows:
``(A) Calculate the total number of weighted
student units (determined in accordance with paragraph
(2)) for each child eligible to be counted by such
agency in accordance with subsection (a).
``(B) Multiply the total number of weighted student
units determined under subparagraph (A) by the local
contribution rate (determined in accordance with
paragraph (3)).
``(2) Determination of weighted student unit.--The
Secretary shall calculate the total number of weighted student
units for a local educational agency as follows:
``(A) Children living on indian lands.--(i) Each
child described in subsection (a)(2) who is not
receiving services under the Individuals with
Disabilities Education Act shall be assigned a weighted
student unit of 1.350.
``(ii) Each child described in subsection (a)(2)
who is eligible for services under the Individuals with
Disabilities Education Act and for whom such local
educational agency is providing a program designed to
meet the special educational and related needs of such
children shall be assigned a weighted student unit of
2.025.
``(B) Military connected children.--(i) Each child
described in subsection (a)(1)(B) who is not receiving
services under Individuals with Disabilities Education
Act shall be assigned a weighted student unit 1.100.
``(ii) Each child described in subsection (a)(1)(B)
who is receiving services under Individuals with
Disabilities Education Act shall be assigned a weighted
student unit of 1.650.
``(iii) Each child described in subsection
(a)(1)(D) who is not receiving services under
Individuals with Disabilities Education Act shall be
assigned a weighted student unit 0.300.
``(iv) Each child described in subsection (a)(1)(D)
who is receiving services under Individuals with
Disabilities Education Act shall be assigned a weighted
student unit 0.450.
``(C) Other federally connected children.--(i) Each
child described in subsection (a)(1)(A) (who is not
described in subparagraph (A) or (B)) shall be assigned
a weighted student unit of 1.000.
``(ii) Each child described in subsection
(a)(1)(C)(iii) (who is not described in subparagraph
(A) or (B)) shall be assigned a weighted student unit
of 0.300.
``(iii) Each child described in subsection
(a)(1)(C)(i) or (a)(1)(C)(ii) (who is not described in
subparagraph (A) or (B)) shall be assigned a weighted
student unit of 0.200.
``(D) Data.--Calculations of weighted student units
for a local educational agency pursuant to this
paragraph shall be made on the basis of data from the
fiscal year preceding the fiscal year in which such
agency applies for a payment under this section in
accordance with section 105.
``(3) Local contribution rate.--(A) Except as provided in
subparagraph (B), in order to compute the local contribution
rate for a local educational agency for any fiscal year, the
Secretary, after consulting with the State educational agency
of the State in which the local educational agency is located
and with the local educational agency, shall determine which
school districts within such State are generally comparable to
the school district of the local educational agency for which
the computation is being made. The local contribution rate for
such agency shall be the quotient of--
``(i) the aggregate current expenditures, during
the third fiscal year preceding the fiscal year for
which the computation is made, which the local
educational agencies of such comparable school
districts derived from local sources, divided by
``(ii) the aggregate number of children in average
daily attendance for whom such agency provided free
public education during such third preceding fiscal
year.
``(B)(i) The local contribution rate for a local
educational agency in any State shall not be less than--
``(I) 50 percent of the average per pupil
expenditure in such State; or
``(II) 50 percent of such expenditures in all the
States,
whichever is greater, except that clause (II) shall not operate
in such a manner as to make the local contribution rate for any
local educational agency in any State exceed an amount equal to
the average per pupil expenditure in such State.
``(ii) If the current expenditures in those school
districts which the Secretary has determined to be generally
comparable to the school district of the local educational
agency for which a computation is made under subparagraph (A)
are not reasonably comparable because of unusual geographical
factors which affect the current expenditures necessary to
maintain, in the school district of such agency, a level of
education equivalent to that maintained in such other school
districts, then the Secretary shall increase the local
contribution rate for such agency by such an amount which the
Secretary determines will compensate such agency for the
increase in current expenditures necessitated by such unusual
geographical factors. The amount of any such supplementary
payment may not exceed the per pupil share (computed with
regard to all children in average daily attendance), as
determined by the Secretary, of the increased current
expenditures necessitated by such unusual geographic factors.
``(iii) The local contribution rate for any local
educational agency in--
``(I) the Commonwealth of Puerto Rico, Wake Island,
Guam, American Samoa, the Commonwealth of the Northern
Mariana Islands, or the Virgin Islands;
``(II) any State in which a substantial proportion
of the land is in unorganized territory; or
``(III) any State in which there is only one local
educational agency,
shall be determined for any fiscal year by the Secretary in
accordance with policies and principles which will best achieve
the purposes of this section and which are consistent with the
policies and principles provided in this paragraph for
determining local contribution rates in States where it is
possible to determine generally comparable school districts.
``(C) The local contribution rate for a local educational
agency shall include current expenditures from that portion of
a real property tax required to be levied, collected, and
distributed to local educational agencies by county governments
pursuant to State law where the remainder of such real property
tax is transferred to the State.
``(D) Because local educational agencies for which the
boundaries of the school district of such agency are
coterminous with the boundaries of a military installation lack
a property tax base, the Secretary shall, for the fiscal year
beginning October 1, 1993, and for each fiscal year thereafter,
establish for such local educational agencies a local
contribution rate which is not less than 70 percent of the
average per pupil expenditure in all States during the third
preceding fiscal year prior to the fiscal year for which the
determination is made. The first sentence of this subparagraph
shall not apply to local educational agencies in any State in
which the State equalization law would prohibit the local
educational agency from retaining such additional funds or in
which State law requires that the State contribution be reduced
in proportion to such additional funds, however the local
contribution rate for such agencies shall not be less than 50
percent of the average per pupil expenditure in all States
during the third preceding fiscal year prior to the fiscal year
for which the determination is made.
``(E) For the purposes of this paragraph--
``(i) the term `State' does not include the
Commonwealth of Puerto Rico, Wake Island, Guam,
American Samoa, the Commonwealth of the Northern
Mariana Islands, or the Virgin Islands; and
``(ii) the `average per pupil expenditure' in a
State shall be--
``(I) the aggregate current expenditures,
during the third fiscal year preceding the
fiscal year for which the computation is made
of all local educational agencies in the State,
divided by
``(II) the aggregate number of children in
average daily attendance for whom such agencies
provide free public education during such third
preceding fiscal year.
``(d) Special Rules.--
``(1) Children with disabilities.--(A) The Secretary shall
by regulation establish criteria for assuring that programs
(including preschool programs) provided by local educational
agencies for children determined under subsections (a)(1)(B),
(a)(1)(D) and (a)(2), who are eligible for services under the
Individuals with Disabilities Education Act, are of sufficient
size, scope, and quality (taking into consideration the special
educational needs of such children) as to give reasonable
promise of substantial progress toward meeting those needs, and
in the implementation of such regulations the Secretary shall
consult with individuals in charge of special education
programs for children with disabilities in the local
educational agency of the State in which such local educational
agency is located.
``(B) For the purpose of this paragraph the term `children
with disabilities' has the same meaning given such term by
section 602(a)(1) of the Individuals with Disabilities
Education Act, and the term `children with specific learning
disabilities' has the same meaning given such term by section
602(a)(15) of such Act.
``(2) Indians.--Payments received for children described in
subsection (a)(2) may be used to pay tuition for any student
not eligible for funding under section 1128 of the Education
Amendments of 1978 in any school receiving assistance under
this section. No condition involving program or personnel shall
apply to such payments.
``(3) Special rule for heavily impacted high need areas.--
(A) If in any fiscal year the Secretary determines that funds
provided to an eligible local educational agency under this
title, together with the funds available to such agency from
State and local sources is less than the amount necessary to
enable such agency to provide a level of education equivalent
to the State average during the preceding fiscal year or to the
average of that maintained during the preceding fiscal year in
3 or more of the school districts of the State which are
generally comparable to the school district of such agency,
whichever is higher, increased or decreased, as the case may
be, in the same percentage as the cost of such level of
education increased or decreased from the third preceding
fiscal year to the prior fiscal year for which the
determination is made, then the Secretary shall increase the
payment made under this section with respect to such agency for
such fiscal year on the basis of data from the fiscal year
preceding the fiscal year for which the determination is made
to the extent necessary to enable such agency to provide a
level of education equivalent to that maintained in such
comparable school districts. The increase computed under this
paragraph shall be sufficient to allow the school district of
the local educational agency to provide a level of education
(calculated in accordance with this subparagraph) equal to the
average of the three comparable districts in the State or the
State average, whichever is greater, as described in clause
(i).
``(B)(i) For the purpose of this paragraph the term
`eligible local educational agency' means a local educational
agency--
``(I) that is making a reasonable tax effort and
exercising due diligence in availing itself of State
and other financial assistance;
``(II) in which not less than 50 percent of the
total number of children who were in average daily
attendance at the schools of such agency during the
fiscal year for which the determination is made and for
whom such agency provided free public education were,
during such fiscal year, determined to be children
described in subsection (a), except that any local
educational agency in which the annual average
percentage of such total number of children described
in subsection (a) for the 3 fiscal years prior to the
fiscal year for which the determination is made exceeds
50 percent of the total children in average daily
attendance at the schools of such agency shall be
deemed to meet the requirements of this paragraph; and
``(III) in which the eligibility of such agency
under State law for State aid with respect to free
public education of children residing on Federal
property, and the amount of such aid, are determined on
a basis no less favorable to such agency than the basis
used in determining the eligibility of local
educational agencies for State aid, and the amount
thereof, with respect to the free public education of
other children in the State.
``(ii) For the purpose of clause (i)(I), the Secretary
shall determine that a reasonable tax effort has been made if
the tax rate of the agency in the year for which the
determination is made (before any State mandated tax rate
reductions resulting from the receipt of State funds has been
implemented) is an amount that is at least equal to 95 percent
of the average tax rate for general fund purposes of comparable
school districts for such fiscal year or the agency's total tax
rate for the preceding fiscal year is at least 95 percent of
the average of the total tax rates of comparable school
districts. Coterminous military districts shall be deemed to
meet the requirement of such reasonable tax effort. Except for
coterminous military districts, payments made to any local
educational agency under this paragraph in any fiscal year
shall be reduced by the percentage that the average tax rate of
the comparable school districts or, if none, the State average
tax rate, exceeds the tax rate of such agency.
``(C) For the purpose of clause (i)--
``(i) available funds may include any cash balance
at the end of a year allowed under State law; or
``(ii) whenever no State law governing cash balance
exists, available funds shall exclude 30 percent of the
local educational agency's operating costs.
``(D) Except as provided in clause (ii), for any fiscal
year after September 30, 1993, the Secretary shall annually
estimate the funds required to carry out the provisions of this
paragraph and shall report the estimate to the Committees on
Appropriations and Education and Labor of the House of
Representatives and the Committees on Appropriations and Labor
and Human Resources of the Senate not later than 45 days after
the date applications are due to be submitted to the Secretary
from local educational agencies in accordance with section
105(a). Such estimate shall also include the amount of funds
required to pay to all local educational agencies eligible for
payments under this paragraph in the preceding fiscal year an
amount equal to the difference between the amount all such
agencies were entitled to receive under this paragraph in such
preceding fiscal year and the amount all such agencies received
under this section in such preceding fiscal year.
``(E) If in any fiscal year in which the total amount of
payments made under this paragraph are less than or equal to
the amount reserved pursuant to section 101(d)(3) to carry out
this paragraph in such fiscal year, then such funds as do not
exceed the amount so reserved shall remain available until
expended to carry out the provisions of this paragraph.
``(F) If the total amount of payments to be made under this
paragraph in a fiscal year exceeds the amount reserved pursuant
to section 101(d)(3) to carry out this paragraph in such fiscal
year, then the amount reserved to carry out this paragraph in
the succeeding fiscal year shall be available to pay to each
local educational agency eligible for payments under this
paragraph in the preceding fiscal year the difference between
the amount each such agency is entitled to receive under this
paragraph in such preceding fiscal year and the amount such
agency received under this paragraph in such preceding fiscal
year.
``(e) Adjustments for Decreases in Federal Activities.--
``(1) In general.--(A) Except as provided in subparagraph
(B), whenever the Secretary determines that--
``(i) for any fiscal year, the number of children
determined with respect to any local educational agency
under section (a) is less than 90 percent of the number
determined with respect to such agency during the
preceding fiscal year;
``(ii) there has been a decrease or cessation of
Federal activities within the State in which such
agency is located; and
``(iii) such decrease or cessation has resulted in
a substantial decrease in the number of children
determined under subsection (a) with respect to such
agency for such fiscal year,
then the amount to which such agency is entitled for such
fiscal year and for the following fiscal year shall not be less
than 90 percent of the payment such agency received under
subsection (a) for the preceding fiscal year.
``(B) The Secretary may adjust the amount to which a local
educational agency is entitled in accordance with the
provisions of subparagraph (A) for 1 additional fiscal year
after the last fiscal year for which such agency is eligible
for an adjustment under such subparagraph if the number of
children determined with respect to such agency under
subsection (a) during such last fiscal year equals or exceeds
25 percent of the number of such children in average daily
attendance at the schools of such agency in such last fiscal
year.
``(2) Authorization of appropriations.--There are
authorized to be appropriated for each fiscal year such amount
as may be necessary to carry out the provisions of this
section, which shall remain available until expended.
``(3) Expenditures.--Expenditures pursuant to paragraph (2)
shall be reported by the Secretary to the Committees on
Appropriations and Education and Labor of the House of
Representatives and the Committees on Appropriations and Labor
and Human Resources of the Senate within 30 days of
expenditure.
``(4) Information on costs.--The Secretary shall make
available to the Congress in the Department of Education's
annual budget submission, the amount of funds necessary to
defray the costs associated with the provisions of this
subsection during the fiscal year for which the submission is
made.
``(f) New Applicants; Determinations on the Basis of Estimates.--
``(1) In general.--Any local educational agency that did
not apply for payments under this section in a preceding fiscal
year and that would be eligible to receive payments under this
section for the fiscal year in which such agency is applying
for the first time, shall be paid on the basis of the number of
children described in subsection (a) who, during the fiscal
year for which the determination is made, are in average daily
attendance at the schools of such agency and for whom such
agency provides free public education.
``(2) Satisfactory data.--Determinations with respect to a
number of children by the Secretary under this subsection for
any fiscal year shall be made, whenever satisfactory data are
not available, on the basis of estimates. No such determination
shall operate, because of an underestimate, to deprive any
local educational agency of its entitlement to any payments
under this section to which such agency would be entitled had
such determination been made on the basis of accurate data.
``(g) Prohibition.--Notwithstanding any other provisions of this
Act, no State may require that a vote of the qualified electors of a
heavily impacted school district of a local educational agency be held
to determine if such school district will spend the amounts to which
the local educational agency is entitled under this Act.
``SEC. 104. SUDDEN AND SUBSTANTIAL CHANGES IN ATTENDANCE.
``(a) Increases Resulting From Base Closure or Military Realignment
Activities.--
``(1) In general.--(A) If the Secretary determines for any
fiscal year ending prior to October 1, 1998 that, as a direct
result of base consolidation or realignment activities of the
Department of Defense (carried on either directly or through a
contractor), an increase in the number of children in average
daily attendance at the schools of any local educational agency
has occurred in such fiscal year, which increase so resulting
from such activities is equal to at least 5 percent of the
difference between the number of children in average daily
attendance at the schools of such agency during the preceding
fiscal year and the number of such children whose attendance
during such year resulted from base consolidation or
realignment activities of the Department of Defense (including
children who resided on Federal property or with a parent
employed on Federal property), then the amount to which such
agency is otherwise entitled under this section shall be paid
on the basis of the number of children who, during the fiscal
year for which the application is made, are in average daily
attendance at the schools of such agency and for whom such
agency provided free public education. Such application shall
include a certificate from the appropriate local base commander
that the increase is the result of Department of Defense base
closure or realignment activities.
``(B) The Secretary shall not make a payment to a local
educational agency for any fiscal year under subparagraph (A)
unless such agency submits a written request for such payment
to the Secretary by January 31 of such year.
``(2) Payment reductions.--If in any fiscal year the amount
appropriated pursuant to the authority of paragraph (3) is
insufficient to carry out the provisions of this subsection for
such fiscal year, then the Secretary shall make a reduction in
the amount that such agency receives under this subsection in
such year on the basis of the number of children in average
daily attendance at the schools of a local educational agency
compared to the total number of children in average daily
attendance in the schools of all local educational agencies in
all States.
``(3) Authorization of appropriations.--(A) There are
authorized to be appropriated for each fiscal year such amount
as may be necessary to carry out this subsection.
``(B) Funds appropriated pursuant to the authority of
subparagraph (A) shall remain available until expended.
``(b) Adjustment for Certain Decreases in Federal Activity.--
Whenever the Secretary determines that--
``(1) a local educational agency has made preparations to
provide during a fiscal year free public education for a
certain number of children to whom subsection (a) applies;
``(2) such preparations were in the Secretary's judgment
reasonable in the light of the information available to such
agency at the time such preparations were made; and
``(3) such number has been substantially reduced by reason
of a decrease in or cessation of Federal activities or by
reason of a failure of any such activities to occur,
then the amount to which such agency is otherwise entitled under this
section for such year shall be increased to the amount to which, in the
judgment of the Secretary, such agency would have been entitled but for
such decrease in or cessation of Federal activities or the failure of
such activities to occur, minus any reduction in current expenditures
for such year which the Secretary determines that such agency has
effected, or reasonably should have effected, by reason of such
decrease in or cessation of Federal activities or the failure of such
activities to occur.
``(c) Consultation With State and Local Authorities.--All
determinations of the Secretary under subsection (a)(2) and subsection
(b) of this section shall be made only after consultation with the
State educational agency and the local educational agency.
``(d) Report on Expenditures.--Expenditures of funds appropriated
pursuant to the authority of subsections (a)(3)(A) and (f)(1) shall be
reported by the Secretary to the Committees on Appropriations and
Education and Labor of the House of Representatives and the Committees
on Appropriations and Labor and Human Resources of the Senate within 30
days of expenditure.
``(e) Annual Budget Submission.--The Secretary shall make available
to the Congress in the Department of Education's annual budget
submission, the amount of funds necessary to defray the costs
associated with the provisions of this section during the fiscal year
for which the submission is made.
``(f) Authorization of Appropriations.--
``(1) In general.--There are authorized to be appropriated
for each fiscal year such amount as may be necessary to carry
out subsections (b) through (e) of this section.
``(2) Availability.--Funds appropriated pursuant to the
authority of paragraph (1) shall remain available until
expended.
``SEC. 105. METHOD OF MAKING PAYMENTS.
``(a) Applications.--
``(1) In general.--Any local educational agency desiring to
receive the payments to which it is entitled for any fiscal
year under section 102, 103, or 104 shall submit an application
therefore to the Secretary and file a copy with the State
educational agency. Each such application shall be submitted in
such form, and containing such information as the Secretary may
reasonably require to determine whether such agency is entitled
to a payment under any of such sections and the amount of such
payment.
``(2) Deadline.--The Secretary shall establish a deadline
for the receipt of applications under this section. For each
fiscal year beginning after the date of enactment of the Impact
Aid Reauthorization Act of 1993, the Secretary shall accept an
approvable application received not more than 60 days after the
deadline, but shall reduce the payment based on such late
application by 10 percent of the amount that would otherwise be
paid. The Secretary shall not accept or approve any application
submitted more than 60 days after the application deadline.
``(3) Special rule.--Notwithstanding any other provision of
law or regulation, a State educational agency that had been
accepted as an applicant for funds under section 103 for fiscal
years 1985, 1986, 1987, and 1988 shall be permitted to continue
as an applicant under the same conditions by which it made
application during such fiscal years only if such State
educational agency distributes all funds received for the
students for which application is being made by such State
educational agency to the local educational agencies providing
educational services to such students.
``(b) Payments by the Secretary.--
``(1) In general.--The Secretary shall pay to each local
educational agency, rounded to the nearest whole dollar, making
application pursuant to subsection (a), the amount to which it
is entitled under section 102, 103, or 104. Sums appropriated
for any fiscal year, to enable the Secretary to make payments
pursuant to this title shall, notwithstanding any other
provision of law unless enacted in express limitation of this
subsection, remain available for obligation and payments with
respect to amounts due local educational agencies under this
title for such fiscal year, until the end of the fiscal year
succeeding the fiscal year for which such sums are
appropriated. The Secretary shall return to the United States
Treasury any funds appropriated for payments under this title
for fiscal year 1988, and thereafter that, as the result of
overpayment and uncontrollable expenditures, are recovered by
the Department of Education after or following the end of the
fifth fiscal year in which the sums were appropriated, or that
remain in Department of Education accounts after that time.
``(2) Data and timing.--Except as otherwise provided in
this title, the Secretary shall--
``(A) make payments to those local educational
agencies eligible to receive funds under sections 102,
103, and 104.
``(B) make such payments in accordance with section
101(e) or as soon as possible in a manner determined by
the Secretary.
``(3) Indian provisions.--(A) The portion of payment for a
local educational agency under section 103 which is
attributable to the difference between--
``(i) the total number of weighted student units
for children determined under section 103(c)(2)(A)(i);
and
``(ii) the total number of weighted student units
for children determined under section 103(c)(2)(C)(i),
shall be made only to a local educational agency which has,
within 1 year of the date of enactment of this Act, or when a
local educational agency is formed after such date of
enactment, within 1 year of its formation, established such
policies and procedures with respect to information received
from Indian parents and tribes as required by this paragraph
and which has made assurances to the Secretary, at such time
and in such manner as shall be determined by regulations
promulgated by the Secretary, that such policies and procedures
have been established. The Secretary is authorized to waive
such 1-year limit for good cause, and in writing to the tribes
affected.
``(B) Each local educational agency shall establish such
policies and procedures as are necessary to ensure that--
``(i) Indian children determined under section
103(a)(2) participate on an equal basis in the school
program with all other children educated by the local
educational agency;
``(ii) applications, evaluations, and program plans
are adequately disseminated to the tribes and parents
of Indian children determined under section 103(a)(2);
and
``(iii) tribes and parents of Indian children
determined under section 103(a)(2) are--
``(I) afforded an opportunity to present
their views with respect to the application,
including the opportunity to make
recommendations concerning the needs of their
children and the ways by which they can assist
their children in realizing the benefits to be
derived from the educational program assisted
under this paragraph;
``(II) actively consulted and involved in
the planning and development of programs
assisted under this paragraph; and
``(III) afforded a general opportunity to
present their overall views on the educational
program, including the operations of such
programs, and the degree of parental
participation allowed.
``(C)(i) Any tribe, or its designee, which has students in
attendance at a local educational agency may, in its discretion
and without regard to the requirement of any other provision of
law, file a written complaint with the Secretary regarding any
action of a local educational agency taken pursuant to, or
relevant to, the requirements of subparagraph (B) of this
paragraph.
``(ii) Within 10 working days from receipt of the
complaint, the Secretary shall--
``(I) designate a time and place for a hearing into
the matters relating to the complaint at a location in
close proximity to the local educational agency
involved, or, if the Secretary determines there is good
cause, at some other location convenient to both the
tribe, or its designees, and the local educational
agency;
``(II) designate a hearing examiner to conduct the
hearing; and
``(III) notify the affected tribe or tribes and the
local educational agency involved of the time, place,
and nature of the hearing and send copies of the
complaint to the local educational agency and the
affected tribe or tribes.
``(iii) The hearing shall be held within 30 days of the
designation of a hearing examiner and shall be open to the
public. A record of the proceedings shall be established and
maintained.
``(iv) The complaining tribe, or its designees, and the
local educational agency shall be entitled to present evidence
on matters relevant to the complaint and to make
recommendations concerning the appropriate remedial actions.
Each party to the hearing shall bear only its own costs in the
proceeding.
``(v) Within 30 days of the completion of the hearing, the
hearing examiner shall, on the basis of the record, make
written findings of fact and recommendations concerning
appropriate remedial actions (if any) which should be taken.
The hearing examiner's findings and recommendations, along with
the hearing record, shall be forwarded to the Secretary.
``(vi) Within 30 days of the Secretary's receipt of the
findings, recommendations, and record, the Secretary, on the
basis of the record, shall make a written determination of the
appropriate remedial action, if any, to be taken by the local
educational agency, the schedule for completion of the remedial
action, and the reasons for the Secretary's decision.
``(vii) Upon completion of the Secretary's final
determination, the Secretary shall provide the complaining
tribe, or its designee, and the local educational agency with
copies of the hearing record, the hearing examiner's findings
and recommendations, and the Secretary's final determination.
The final determination of the Secretary shall be subject to
judicial review.
``(viii) In all actions under this subparagraph, the
Secretary shall have discretion to consolidate complaints
involving the same tribe or local educational agency.
``(D) If the local educational agency rejects the
determination of the Secretary, or if the remedy required is
not undertaken within the time established and the Secretary
determines that an extension of the time established will not
effectively encourage the remedy required, the Secretary shall
withhold payment of all moneys to which such local agency is
entitled under section 103 until such time as the remedy
required is undertaken, except--
``(i) where the complaining tribe or its designees
formally requests that such funds be released to the
local educational agency; and
``(ii) that the Secretary may not withhold such
moneys during the course of the school year if the
Secretary determines that it would substantially
disrupt the educational programs of the local
educational agency.
``(E) If the local educational agency rejects the
determination of the Secretary and a tribe exercises the option
under section 1101(d) of the Education Amendments of 1978, to
have education services provided either directly by the Bureau
of Indian Affairs or by contract with that Agency, any Indian
students affiliated with that tribe who wish to remain in
attendance at the local educational agency against whom the
complaint which led to the tribal action under such subsection
(d) was lodged may be counted with respect to that local
educational agency for the purpose of receiving funds under
section 103(c)(2)(A) of this Act. In such event, funds under
such section shall not be withheld pursuant to subparagraph (D)
and no further complaints with respect to such students may be
filed under subparagraph (C)(i).
``(F) This paragraph is based upon the special relationship
between the Indian nations and the United States and nothing in
this paragraph shall be deemed to relieve any State of any duty
with respect to any citizens of that State.
``(4) Military connected children.--(A) The portion of a
payment under section 103 to a local educational agency which
is attributable to the difference between--
``(i) the total number of weighted student units
for children determined under section 103(c)(2)(B); and
``(ii) the total number of weighted student units
for children determined under section 103(c)(2)(C)
shall be made only to a local educational agency which
has within 1 year of the date of enactment of the
Impact Aid Reauthorization Act of 1993, or when a local
educational agency is formed after such date of
enactment, within 1 year of its formation, established
a process, in accordance with regulations promulgated
by the Secretary, which ensures the involvement of the
local military base commander or such commander's
designee for the purpose of better meeting the
educational, emotional, and social needs of the
children determined under such sections.
``(B) The Secretary shall annually review the process
established under subparagraph (A) to ensure that local
educational agencies receiving funds for children determined
under section 103(c)(2)(B) are addressing the needs of such
children.
``(c) The Learning Opportunity Threshold; Adjustments Where
Necessitated by Appropriations.--
``(1) In general.--Except as provided in paragraph (5), if
the sums appropriated for any fiscal year for making payments
on the basis of entitlements under section 103 are not
sufficient to pay in full the total amounts that the Secretary
calculated all local educational agencies are entitled to
receive under section 103 in such fiscal year, then the
Secretary, shall allocate such sums as do not exceed the total
amount necessary to pay the learning opportunity threshold
(described in paragraph (2)) for all local educational agencies
eligible for a payment under such section in such year, among
local educational agencies by paying to each such agency an
amount equal to such agencies' learning opportunity threshold.
``(2) Determination of learning opportunity threshold.--(A)
Except as provided in paragraph (3), the Secretary shall
calculate a local educational agency's learning opportunity
threshold by determining the percentage of federally connected
children served by such agency (in accordance with subparagraph
(B)), adding to such percentage the equal opportunity cost
percentage (determined in accordance with subparagraph (C)),
and multiply the resulting percentage by the equal opportunity
cost determined in accordance with section 103(c).
``(B) Determination of the percentage of federally
connected children.--The Secretary shall determine the
percentage of federally connected children for a local
educational agency in any fiscal year by calculating a
fraction, the numerator of which is the number of children
served by such agency in the preceding fiscal year who are
described in section 103(c)(2), and the denominator of which is
the total number of children in average daily attendance at the
schools served by such agency in the preceding fiscal year, and
multiplying such fraction by 100.
``(C) Determination of the equal opportunity cost
percentage.--(i) The Secretary shall determine the equal
opportunity cost percentage for a local educational agency in
any fiscal year by calculating a fraction, the numerator of
which is the equal opportunity cost (determined in accordance
with section 103(c)(1)) for such agency in the preceding fiscal
year, and the denominator of which is the total current
expenditures for such agency in such preceding fiscal year, and
multiplying such fraction by 100.
``(ii) The Secretary shall subtract payments provided
pursuant to section 103(d)(3) from the calculation of a local
educational agency's total current expenditures before
calculating such agency's equal opportunity cost percentage in
accordance with this paragraph.
``(iii) No local educational agency's equal opportunity
cost percentage as determined under this subsection shall
exceed 100 percent.
``(D) Maximum payment.--No local educational agency shall
receive a payment under this subsection that is greater than
such agency's equal opportunity cost calculated in accordance
with section 103(c)(1) of this Act.
``(3) Learning opportunity threshold modifier percentage.--
(A) If a local educational agency has an average daily
attendance (hereafter referred to in this Act as the `ADA') of
fewer than 1,000 children, then the Secretary shall modify the
learning opportunity threshold (calculated in accordance with
paragraph (2)) by adding an additional learning opportunity
threshold modifier percentage for such agency (determined in
accordance with subparagraph (B)) to the percentage described
in paragraph (2) before multiplying the resultant percentage by
the equal opportunity cost (in accordance with paragraph (2)).
``(B) The Secretary shall calculate a local educational
agency's learning opportunity threshold modifier percentage by
calculating the percentage determined in accordance with the
following formula:
1,000-the total number of students in ADA at the schools served
by the local educational agency in the preceding fiscal year
25<greek-e><3-ln (> --------------------------------------------------
------ <3-ln )>.
1,000
``(4) Special rule regarding additional funds.--If the sums
appropriated pursuant to the authority of section 103(c) in any
fiscal year are sufficient to pay learning opportunity
threshold (determined in accordance with paragraph (2)) for all
local educational agencies eligible to receive assistance under
section 103 in such year but are insufficient to pay the equal
opportunity cost (determined in accordance with section
103(c)(1)) of all such agencies in such year, then such funds
as exceed the amount necessary to pay the learning opportunity
threshold for all such agencies in such year shall be
distributed to such agencies in such year on the basis of the
total number of weighted student units (calculated in
accordance with section 103(c)(2)) applicable to each local
educational agency eligible to receive assistance under section
103 in such year compared to the total number of weighted
student units applicable to all such agencies in such year,
except that in no case shall the payment to a local educational
agency under this subsection exceed the amount equal to such
local educational agency's equal opportunity cost (determined
in accordance with section 103(c)(1)).
``(5) Insufficient appropriations.--If the sums
appropriated pursuant to the authority of section 101(c) in any
fiscal year are insufficient to pay the amount necessary to
make payments in accordance with paragraph (1), then the
Secretary shall determine the amount of such deficiency and
reduce the payments to each local educational agency as
follows:
``(A) 50 percent of any deficiency shall be
addressed by ratably reducing the payments of all local
educational agencies receiving assistance under this
title in such year; and
``(B) 50 percent of any deficiency shall be
addressed by reducing the payments to all local
educational agencies receiving assistance under this
title in such year on the basis of the total number of
weighted student units applicable to a local
educational agency receiving assistance under this
title in such year compared to the total number of
weighted student units applicable to all such agencies
in such year.
``(d) Treatment of Payment by the States in Determining Eligibility
for, and the Amount of, State Aid.--
``(1) In general.--Except as provided in paragraph (2), the
Secretary may withhold payments, in accordance with paragraph
(3), for any fiscal year to any State educational agency in any
State if--
``(A) that State has taken into consideration
during that fiscal year or the preceding fiscal year
payments under this Act in determining--
``(i) the eligibility of any local
educational agency in that State for State aid
for free public education of children;
``(ii) the amount of such State aid with
respect to any such agency during that fiscal
year or the preceding fiscal year; or
``(iii) a reduction in the amount of such
State aid based on an end-of-year balance in
any fund of the local educational agency into
which payments under this Act have been
deposited, unless such reduction is calculated
in a manner that excludes the amount of funds
deposited into such fund in any fiscal year
that are attributable to payments under this
Act; or
``(B) that State makes such State aid available to
local educational agencies in such a manner as to
result in less State aid to any local educational
agency which is eligible for payments under this Act
than such agency would receive if such agency were not
so eligible.
``(2) Special rules.--(A) Notwithstanding paragraph (1) of
this subsection, if a State's per pupil expenditure is equal to
or greater than the average per pupil expenditure of all the
States and has in effect a program of State aid for free public
education for any fiscal year, which is designed to equalize
expenditures for free public education among the local
educational agencies of that State, payments under this title
for any fiscal year may be taken into consideration by such
State in determining the relative--
``(i) financial resources available to local
educational agencies in that State; and
``(ii) financial need of such agencies for the
provision of free public education for children served
by such agency,
except that a State may consider as local resources funds
received under this Act only in proportion to that share that
local revenues covered under a State equalization program are
of total local revenues.
``(B) The amount of a payment to a local educational agency
under section 103 which is attributable to the sum of--
``(i)(I) the total number of weighted student units
for students determined under sections 103(c)(2)(A),
103(c)(2)(B)(i), and 103(c)(2)(B)(ii); less
``(II) the total number of the weighted student
units for such students if such students had been
determined under section 103(c)(2)(C); plus
``(ii) the increase in payments described in
sections 103(c)(3)(B)(ii) and 103(d)(3),
shall not be taken into consideration by the State for the
purpose of this paragraph.
``(C) Whenever a State educational agency or local
education agency will be adversely affected by the operation of
this subsection, such agency shall be afforded notice and an
opportunity for a hearing
prior to the reduction or termination of payments pursuant to
this subsection.
``(D) The terms `State aid, State school finance program',
and `equalize expenditures' as used in this subsection shall be
defined by the Secretary by regulations after consultation with
the National Panel established in paragraph (4) and the State
and local education agencies affected by this subsection,
except that such terms shall be defined in a manner that
ensures that adequate provisions are made for the costs
required to--
``(i) provide free public education for meeting the
special educational needs of particular groups or
categories of at-risk students such as children with
disabilities, economically disadvantaged children,
children who need bilingual education, and gifted and
talented children;
``(ii) enable local educational agencies to provide
equivalent programs and services; and
``(iii) recognize the special conditions among the
diverse local educational agencies in the State.
``(E)(i) In making the determination as to a State's
eligibility to consider payments under this title in the
calculation of State payments to local educational agencies in
accordance with subparagraph (A), equalization shall be
calculated on the basis of expenditure disparity per pupil. The
State school finance program shall be considered equalized when
the disparity in per pupil expenditures is not greater than 105
percent in terms of the relationship of the spending level per
pupil in the highest spending local educational agency to the
spending level per pupil in the lowest spending local
educational agency after excluding the highest spending local
educational agencies with 5 percent of the students. In
reviewing a State's eligibility to carry out the provisions of
subparagraph (A), the National Panel established in paragraph
(4) may recommend to the Secretary that the equalization
calculations exclude low spending local educational agencies
that serve not more than 5 percent of the students in the State
on a case-by-case basis when the National Panel determines that
unusual circumstances exist.
``(ii) If a State desires to take payments under this
section into consideration as provided in this paragraph for
any fiscal year, that State shall, not later than 60 days prior
to the beginning of such fiscal year, submit notice to the
Secretary of its intention to do so. Such notice shall be in
such form and be accompanied by such information as to enable
the Secretary to determine the extent to which the program of
State aid of that State is consistent with the provisions of
subparagraph (A). In addition, such notice shall be accompanied
by a narrative description of the State's school finance
program and include appropriate documentation of the manner in
which the State's school finance program provides adequate
recognition of special students and special conditions. If the
Secretary determines that the program of State aid of a State
submitting notice under this subparagraph is consistent with
the provisions of subparagraph (A), the Secretary shall certify
such determination to that State.
``(iii) A State shall not be eligible to carry out the
provisions of subparagraph (A) if such State's allocation of
funds under the State school finance program results in a local
education agency having less revenues per pupil for current
operations than the minimum per pupil provided in the State
school finance program.
``(iv) Prior to certifying any determination under clause
(i) for any State for any fiscal year, the Secretary shall give
the local educational agencies in that State an opportunity for
a hearing at which such agencies may present their views with
respect to the consistency of the State aid program of that
State with the provisions of subparagraph (A).
``(v) The Secretary shall not finally deny to any State for
any fiscal year certification of denial of payments under
clause (i) without first giving that State an opportunity for a
hearing.
``(vi) Any State certified in accordance with section
5(d)(2)(A) of this Act (as such section was in effect prior to
the date of enactment of this subsection) shall have 3 years
from the date of the enactment of the Impact Aid
Reauthorization Act of 1993 to comply with the requirements of
this paragraph.
``(3) Withholding authorized.--If, prior to a certification
determination of eligibility by the Secretary in accordance
with paragraph (2)(E)(i), a State takes payments under this
title for any fiscal year into consideration in determining the
financial resources available to local educational agencies
within the State or the financial need of such agencies to
provide for free public education, the Secretary shall withhold
all funds payable to the State educational agency for State
administrative expenses associated with any Federal elementary
and secondary education programs.
``(4) National advisory panel established.--(A)(i) There is
hereby established a National Advisory Panel on School Finance
and Impact Aid Equalization (hereafter in this Act referred to
as the `National Panel'), which shall consist of 11 members
appointed by the Secretary, of which--
``(I) 5 members shall be employed in local
educational agencies;
``(II) 3 members shall be employed in State
educational agencies; and
``(III) 3 members shall be persons with experience
in the design and structure of State school finance
programs, one of whom shall have particular knowledge
of funding for special needs populations.
``(ii) The Secretary shall give consideration to ensuring
that the National Panel's membership includes representatives
of--
``(I) States with large numbers of students
described in section 103(a); and
``(II) local educational agencies with different
types of such students.
``(iii) Prior to making the appointments described in
clause (i), the Secretary shall request nominees from the
National Association of Federally Impacted Schools and the
Council of Chief State School Officers.
``(B) The National Panel shall--
``(i) advise the Secretary with respect to the
development of regulations and administrative practices
and policies under this subsection;
``(ii) advise the Secretary relative to the
evidence that each State is to submit when seeking a
determination under paragraph (2)(A); and
``(iii) submit a recommendation to the Secretary
regarding a State's equalization status and eligibility
to consider payments under this title in making State
payments to local educational agencies, after reviewing
the narrative and statistical documents that each State
submits to the Secretary when seeking an equalization
certification under paragraph (2)(E)(i) in terms of the
extent to which the State's school finance program
makes provision for sufficient funds to ensure an
adequate program of free public education for all
children and recognizes the diversity of conditions
among local educational agencies in the State.
``(C) The National Panel may--
``(i) review applications submitted to the
Secretary for, and make recommendations regarding,
funding from the contingency fund established in
section 202; and
``(ii) respond to other requests from the Secretary
regarding any other provision of this Act.
``(D) Members of the National Panel shall not be
compensated for their service on the National Panel, but while
serving away from their homes or regular places of business,
members of the National Panel may be reimbursed for travel
expenses, including per diem in lieu of subsistence, as
authorized by section 5703 of title 5, United States Code, for
persons in government service employed intermittently.
``(e) Phase-In Provision.--
``(1) In general.--(A) Notwithstanding any other provision
of this Act and except as provided in paragraph (2), each local
educational agency which--
``(i) received a payment in fiscal year 1993 under
section 3 of this Act (as such Act was in existence
prior to the date of enactment of the Impact Aid
Reauthorization Act of 1993) and is eligible to receive
a payment under section 103 in any of the fiscal years
1994, 1995, and 1996; or
``(ii) is applying for funds under section 103 for
the first time in any of the fiscal years 1994, 1995,
and 1996,
shall receive a payment under section 103 in any of the fiscal
years 1994, 1995, and 1996 in an amount determined on the basis
of the total number of weighted student units applicable to
such agency in the fiscal year preceding the fiscal year for
which the determination is made compared to the total number of
weighted student units applicable to all such agencies in all
States in such preceding fiscal year.
``(B) The payment a local educational agency receives
pursuant to the operation of subparagraph (A) in any of the
fiscal years 1994, 1995, and 1996 shall not be more than 10
percent greater than, nor less than 10 percent lesser than, the
amount such agency received by operation of subparagraph (A) in
the preceding fiscal year.
``(2) Special rules.--(A) If the amount appropriated to
carry out this title is insufficient to carry out the
provisions of paragraph (1), then the Secretary shall determine
the amount of such deficiency and reduce the payments described
in paragraph (1) in accordance with the provisions of
subparagraphs (A) and (B) of section 105(c)(5).
``(3) New applicants.--In the case of a local educational
agency applying for funds under section 103 for the first time
in any of the fiscal years 1994, 1995, and 1996, the Secretary,
prior to making a payment pursuant to paragraph (1), shall
determine the total number of weighted student units applicable
to such agency in the fiscal year preceding the fiscal year in
which such agency submits its initial application under section
103, and shall apply the provisions of paragraph (1) on the
basis of such determination.
``(f) Children With Disabilities.--
``(1) Indian lands connected children.--If in any fiscal
year the number of children determined under section
103(c)(2)(A)(ii) for a local educational agency who are
eligible to receive payments under section 103 exceeds the
average number of children eligible for services under the
Individuals with Disabilities Education Act for local
educational agencies in the State, then the Secretary of the
Interior shall make available in such year, from funds
available to the Secretary of the Interior to carry out the
Individuals with Disabilities Education Act, the funds required
to pay the portion of payments under section 103 to such local
educational agency which are attributable to the difference
between--
``(A) the sum of the total number of weighted
student units for children determined under section
103(c)(2)(A)(ii); and
``(B) the total number of weighted student units
for children determined under section 103(c)(2)(C)(i).
``(2) Defense connected children.--(A) If in any fiscal
year the number of children determined under sections
103(c)(2)(B)(ii) and 103(c)(2)(B)(iv) for a local educational
agency who are eligible to receive payments under section 103
exceeds the average number of children eligible for services
under the Individuals with Disabilities Education Act for local
educational agencies in the State, then the Secretary of
Defense shall make available, either directly or through
contract, from funds appropriated to carry out section 106, to
such local educational agency--
``(A) the funds required to pay the portion of
payments under section 103 which are attributable to
the difference between--
``(i) the sum of the total number of
weighted student units for children determined
under sections 103(c)(2)(B)(ii) and
103(c)(2)(B)(iv); and
``(ii) the total number of weighted student
units for children determined under section
103(c)(2)(C)(i); and
``(B) the total cost associated with any child
determined under sections 103(c)(2)(B)(ii) and
103(c)(2)(B)(iv) who is enrolled by such local
educational agency because of a disability, in an
educational program provided outside the schools of
such local educational agency.
``(3) Use of funds.--The amount of funds provided to a
local educational agency by reason of the operation of
paragraph (2) shall be used by such agency for special
educational programs designed to meet the special educational
needs of children with respect to whom the determination under
such paragraph is made.
``(g) Special Payment Rule.--Each local educational agency
described in section 103(c)(3)(D) which is not directly operating an
educational program or has entered into a contract or similar
arrangement with another local educational agency for the operation of
a substantial number of such agency's educational programs (as
determined by the Secretary), shall not receive a payment under section
103 in any fiscal year that, when added to any payments received from
State and local sources for such year, exceeds the amount such agency
receives from State and local sources.
``(h) Hearing and Review.--Each local educational agency which is
adversely affected or aggrieved by any action of the Secretary under
this Act shall be entitled to a hearing on, and review of, such action
in the same manner as if such agency were a person under the provisions
of chapters 5 and 7 of title 5, United States Code.
``SEC. 106. CHILDREN FOR WHOM LOCAL AGENCIES ARE UNABLE TO PROVIDE
EDUCATION.
``(a) In General.--In the case of children who reside on Federal
property--
``(1) if no tax revenues of the State or any political
subdivision thereof may be expended for the free public
education of such children; or
``(2) if it is the judgment of the Secretary, after the
Secretary has consulted with the appropriate State educational
agency, that no local educational agency is able to provide
suitable free public education for such children,
then the Secretary shall make such arrangements (other than
arrangements with respect to the acquisition of land, the erection of
facilities, interest, or debt service) as may be necessary to provide
free public education for such children. Such arrangements to provide
free public education may also be made for children of members of the
Armed Forces on active duty, if the schools in which the free public
education is usually provided for such children are made unavailable to
such children as a result of official action by State or local
governmental authority and it is the judgment of the Secretary, after
the Secretary has consulted with the appropriate State educational
agency, that no local educational agency is able to provide suitable
free public education for such children. To the maximum extent
practicable, the local educational agency, or the head of the Federal
department or agency, with which any arrangement is made under this
section shall take such action as may be necessary to ensure that the
education provided pursuant to such arrangement is comparable to free
public education provided for children in comparable communities in the
State or in the case of education provided under this section outside
the continental United States, Alaska, and Hawaii, comparable to free
public education provided for children in the District of Columbia. For
the purpose of providing such comparable education, personnel may be
employed and the compensation, tenure, leave, hours of work, and other
incidents of the employment relationship may be fixed without regard to
the provisions of title 5 of the United States Code. Personnel provided
for under this subsection outside of the continental United States,
Alaska, and Hawaii, shall receive such compensation, tenure, leave,
hours of work, and other incidents of employment on the same basis as
provided for similar positions in the public schools of the District of
Columbia. In any case where education was being provided on January 1,
1955, or thereafter under an arrangement made under this subsection for
children residing on an Army, Navy (including the Marine Corps), or Air
Force installation, it shall be presumed, for the purposes of this
subsection, that no local educational agency is able to provide
suitable free public education for the children residing on such
installation, until the Secretary and the Secretary of the military
department concerned jointly determine, after consultation with the
appropriate State educational agency, that a local educational agency
is able to do so.
``(b) Adjacent Property.--In any case in which the Secretary makes
such arrangements for the provision of free public education in
facilities situated on Federal property, the Secretary may also make
arrangements for providing free public education in such facilities for
children residing in any area adjacent to such property with a parent
who during some portion of the fiscal year in which such education is
provided, was employed on such property, but only if the Secretary
determines after consultation with the appropriate State educational
agency--
``(1) that the provision of such education is appropriate
to carry out the purposes of this title;
``(2) that no local educational agency is able to provide
suitable free public education for such children; and
``(3) in any case where in the judgment of the Secretary
the need for the provision of such education will not be
temporary in duration, that the local educational agency of the
school district in which such children reside, or the State
educational agency, or both, will make reasonable tuition
payments to the Secretary for the education of such children.
Such payments may be made either directly or through deductions
from amounts to which the local educational agency is entitled
under this title, or both, as may be agreed upon between such
agency and the Secretary. Any amounts paid to the Secretary by
a State or local educational agency pursuant to this section
shall be covered into the Treasury as miscellaneous receipts.
``(c) Outlying Areas.--In any case in which the Secretary makes
arrangements under this section for the provision of free public
education in facilities situated on Federal property in the
Commonwealth of Puerto Rico, Wake Island, Guam, American Samoa, the
Commonwealth of the Northern Mariana Islands, or the Virgin Islands,
the Secretary may also make arrangements for providing free public
education in such facilities for children residing with a parent
employed by the United States, in a grade, position, or classification
subject by policy and practice to transfer or reassignment to areas
where English is the language of instruction in the schools normally
attended by children of Federal employees. Dependents of excepted
service professional employees of the schools shall be eligible to
attend the schools. In any case where education is being provided under
an arrangement made under this subsection, it shall be presumed that no
local educational agency is able to provide suitable free public
education for the children of eligible parents employed by the United
States until the Secretary determines, after consultation with the
appropriate State educational agency, that a local educational agency
is able to do so.
``(d) Arrangements.--The Secretary may make an arrangement under
this section only with a local educational agency or with the head of a
Federal department or agency administering Federal property on which
children reside who are to be provided education pursuant to such
arrangement or, in the case of children to whom the second sentence of
subsection (a) applies, with the head of any Federal department or
agency having jurisdiction over the parents of some or all of such
children. Except where the Secretary makes arrangements pursuant to the
second sentence of subsection (a), arrangements may be made under this
section only for the provision of education in facilities of a local
educational agency or in facilities situated on Federal property. The
Secretary shall ensure that funds provided under such arrangement or
arrangements are expended in an efficient manner, and shall require an
accounting of funds by such agency at least on an annual basis. The
Secretary shall further be provided with data relating to the quality
and type of education provided to such children under such arrangement
or arrangements.
``(e) Limitation on Payments.--To the maximum extent practicable,
the Secretary shall limit the total payments made pursuant to any such
arrangement for educating children within the continental United
States, Alaska, or Hawaii, to an amount per pupil which will not exceed
the per pupil cost of free public education provided for children in
comparable communities in the State. The Secretary shall limit the
total payments made pursuant to any arrangement for educating children
outside the continental United States, Alaska, or Hawaii, to an amount
per pupil which will not exceed the amount the Secretary determines to
be necessary to provide education comparable to the free public
education provided for children in the District of Columbia.
``(f) Expenditure of Tax Revenues.--If no tax revenues of a State
or of any political subdivision of the State may be expended for the
free public education of children who reside on any Federal property
within the State, or if no tax revenues of a State are allocated for
the free public education of such children, then the property on which
such children reside shall not be considered Federal property for the
purposes of sections 103 and 104 of this Act. If a local educational
agency refuses for any other reason to provide in any fiscal year free
public education for children who reside on Federal property which is
within the school district of that agency or which, in the
determination of the Secretary, would be within the school district if
it were not Federal property, there shall be deducted from any amount
to which the local educational agency is otherwise entitled for that
year under section 103 or 104 an amount equal to--
``(1) the amount (if any) by which the cost to the
Secretary of providing free public education for that year for
each such child exceeds the local contribution rate of that
agency for that year, multiplied by
``(2) the number of such children.
``(g) Elective School Board.--The Secretary shall ensure the
establishment of an elective school board in schools assisted under
this section. Such school board shall be composed of a minimum of 3
members, elected by the parents of students in attendance at such
school. The Secretary shall, by regulation, establish procedures for
carrying out such school board elections as provided in this
subsection.
``(h) Powers of Elective School Boards.--A school board established
pursuant to subsection (g) shall be empowered to oversee school
expenditures and operations, subject to audit procedures established by
the Secretary, and other provisions of this section.
``(i) Special Rule.--
``(1) In general.--Notwithstanding any other provision of
law, a local educational agency receiving funds under section
103 may also receive funds under this section, if--
``(A) at least 30 percent of the students enrolled
in the schools served by such agency are students
determined under section 103(c)(2)(B);
``(B) such agency applied for and received, or will
receive, financial assistance from all available
Federal, State, and local revenue sources, including
revenue available from other sections of this title;
and
``(C) such agency provides educational services to
students determined under section 103(c)(2)(B) free of
charge.
``(2) Reservations.--The Secretary of Defense shall
reserve--
``(A) 80 percent of the amount available to carry
out this subsection for distribution to local
educational agencies in accordance with the provisions
of this subsection whose per pupil expenditure is less
than the State average per pupil expenditure; and
``(B) 20 percent of such amount for distribution to
local educational agencies whose per pupil expenditure
is higher than the State average per pupil expenditure.
``(3) Counting.--Beginning in fiscal year 1994 and in each
succeeding fiscal year, payments to a local educational agency
in a fiscal year under this subsection shall be made on the
basis of the total number of students determined under clauses
(i) and (ii) of section 103(c)(2)(B) applicable to such agency
compared to the total number of students determined under such
clauses applicable to all local educational agencies receiving
payments under this subsection in such fiscal year.
``SEC. 107. ASSISTANCE FOR CURRENT SCHOOL EXPENDITURES IN CASES OF
CERTAIN DISASTERS.
``(a) In General.--In any case in which--
``(1) the Director of the Federal Emergency Management
Agency determines with respect to any local educational agency
(including for the purpose of this section any other public
agency which operates schools providing technical, vocational,
or other special education to children of elementary or
secondary school age) that such agency is located in whole or
in part within an area which after August 30, 1965, and prior
to October 1, 1998, has suffered a major disaster as the result
of any flood, drought, fire, hurricane, earthquake, storm, or
other catastrophe which, in the determination of the President
pursuant to sections 102(2) and 401 of the Robert T. Stafford
Disaster Relief and Emergency Assistance Act, is or threatens
to be of sufficient severity and magnitude to warrant disaster
assistance by the Federal Government, and
``(2) the Governor of the State in which such agency is
located has certified the need for disaster assistance under
this section, and has given assurance of expenditure of a
reasonable amount of the funds of the government of such State,
or of any political subdivision thereof, for the same or
similar purposes with respect to such catastrophe,
and if the Secretary determines with respect to such agency that--
``(A) such agency is utilizing or will utilize all
State and other financial assistance available to it
for the purpose of meeting the cost of providing free
public education for the children attending the schools
of such agency, but as a result of such disaster it is
unable to obtain sufficient funds for such purpose and
requires an amount of additional assistance equal to at
least $10,000 or 5 percent of such agency's current
operating expenditures during the fiscal year preceding
the fiscal year in which such disaster occurred,
whichever is less, and
``(B) in the case of any such major disaster to the
extent that the operation of private elementary and
secondary schools in the school attendance area of such
local educational agency has been disrupted or impaired
by such disaster, such local educational agency has
made provisions for the conduct of educational programs
under public auspices and administration in which
children enrolled in such private elementary and
secondary schools may attend and participate, except
that nothing contained in this Act shall be construed
to authorize the making of any payment under this Act
for religious worship or instruction,
then the Secretary may provide to such agency the additional assistance
necessary to provide free public education to the children attending
the schools of such agency, upon such terms and in such amounts
(subject to the provisions of this section) as the Secretary may
consider to be in the public interest. Such additional assistance may
be provided for a period not greater than a 5-fiscal-year period
beginning with the fiscal year in which it is determined pursuant to
paragraph (1) of this subsection that such agency suffered a disaster.
The amount so provided for any fiscal year shall not exceed the amount
which the Secretary determines to be necessary to enable such agency,
with the State, local, and other Federal funds available to it for such
purpose, to provide a level of education equivalent to that maintained
in the schools of such agency prior to the occurrence of such disaster,
taking into account the additional costs reasonably necessary to carry
out the provisions of paragraph (2)(B) of this subsection. The amount,
if any, so provided for the second, third, and fourth fiscal years
following the fiscal year in which it is so determined that such agency
has suffered a disaster shall not exceed 75 percent, 50 percent, and 25
percent, respectively, of the amount so provided for the first fiscal
year following such determination.
``(b) Additional Funds.--In addition to and apart from the funds
provided under subsection (a), the Secretary is authorized to provide
to such agency an amount which the Secretary determines to be necessary
to replace instructional and maintenance supplies, equipment, and
materials (including textbooks) destroyed or seriously damaged as a
result of such disaster, to make minor repairs, and to lease or
otherwise provide (other than by acquisition of land or erection of
facilities) school and cafeteria facilities needed to replace
temporarily such facilities which have been made unavailable as a
result of the disaster.
``(c) Authorization of Appropriations.--There are authorized to be
appropriated for each fiscal year such amounts as may be necessary to
carry out the provisions of this section. Pending such appropriation,
the Secretary is authorized to expend (without regard to the provisions
of sections 1341 and 1515 of title 31, United States Code) from any
funds appropriated to the Department of Education and at that time
available to the Secretary, such sums as may be necessary for providing
immediate assistance under this section. Expenditures pursuant to the
preceding sentence shall--
``(1) be reported by the Secretary to the Committees on
Appropriations and Education and Labor of the House of
Representatives and the Committees on Appropriations and Labor
and Human Resources of the Senate within 30 days of the
expenditure; and
``(2) be reimbursed from the appropriations authorized by
the first sentence of this subsection.
The report required to be submitted to the Committees on Appropriations
by paragraph (1) of the preceding sentence shall constitute a budget
estimate with the meaning of section 3109 of title 31, United States
Code.
``(d) Application Required.--No payment may be made to any local
educational agency under this section except upon application therefore
which is submitted through the appropriate State educational agency and
is filed with the Secretary in accordance with the regulations
prescribed by the Secretary. In determining the order in which such
applications shall be approved, the Secretary shall consider the
relative educational and financial needs of the local educational
agencies which have submitted approved applications. The Secretary
shall complete action of approval or disapproval of an application
within 90 days of the filing of an application.
``(e) Payment.--Amounts paid by the Secretary to local educational
agencies under this section may be paid in advance or by way of
reimbursement and in such installments as the Secretary may determine.
Any funds paid to a local educational agency and not expended or
otherwise used for the purposes for which paid shall be repaid to the
Treasury of the United States.
``(f) Availability.--Funds available for this section for any
fiscal year shall also be available for section 16 of the Act of
September 23, 1950 (Public Law 815, 81st Congress).
``TITLE II--GENERAL PROVISIONS
``SEC. 201. ADMINISTRATION.
``(a) In General.--The Secretary shall administer this Act, and the
Secretary may make such regulations and perform such other functions as
the Secretary finds necessary to carry out the provisions of this Act.
``(b) Report.--The Secretary shall include in the Secretary's
annual report to the Congress a full report of the administration of
the Secretary's functions under this Act, including a detailed
statement of receipts and disbursements.
``SEC. 202. DEPARTMENT OF EDUCATION CONTINGENCY FUND.
``(a) Establishment.--
``(1) In general.--There is established a Department of
Education Contingency Fund (hereafter in this Act referred to
as the `Fund').
``(2) Contents.--The Fund shall consist of amounts
appropriated to the Fund pursuant to section 101(c)(2), amounts
deposited into the Fund pursuant to section 101(d)(2), and any
interest on or earnings from the Fund.
``(b) Uses.--The Secretary shall use amounts in the Fund to meet
emergencies and unforeseen contingencies affecting the local
educational agencies assisted under this Act (including local
educational agencies assisted under section 103(d)(3)) when other
funding sources have been exhausted. The Secretary shall consider as
examples of emergencies to be funded under this section--
``(1) a local educational agency eligible for payment under
section 103(e);
``(2) a local educational agency that experiences an
increase in the number of federally connected children
described in section 103(a) from the prior fiscal year to the
fiscal year in which the determination is made, but is not
eligible for a payment under section 104; and
``(3) a local educational agency that does not receive a
payment under section 102 because of the operation of
subsection (g) of such section due to circumstances beyond the
control of such agency.
``(c) Availability.--Amounts in the Fund shall be available to the
Secretary to carry out the provisions of this section and shall remain
available without fiscal year limitation until expended.
``(d) Report.--Whenever the Secretary makes funds available under
this section, or denies the availability of such funds, to a local
educational agency, the Secretary shall report such action to the
Committees on Appropriations and Education and Labor of the House of
Representatives and the Committees on Appropriations and Labor and
Human Resources of the Senate within 30 days of such expenditure. Such
report shall include a description of the request for funding under
this section from the local educational agency applying for such
funding along with the Secretary's justification for approval or
disapproval of such request.
``(e) Application.--Each local educational agency desiring
assistance under this section in any fiscal year shall submit an
application, in accordance with such regulations as the Secretary may
promulgate, to the Secretary postmarked not later than January 31 of
such fiscal year.
``SEC. 203. USE OF OTHER FEDERAL AGENCIES; TRANSFER AND AVAILABILITY OF
APPROPRIATIONS.
``(a) Use of Other Federal Agencies.--In carrying out the
Secretary's functions under this Act, the Secretary is authorized,
pursuant to proper agreement with any other Federal department or
agency, to utilize the services and facilities of such department or
agency, and, when the Secretary deems it necessary or appropriate, to
delegate to any officer or employee thereof the function under section
106 of making arrangements for providing free public education. Payment
to cover the cost of such utilization or of carrying out such delegated
function shall be made either in advance of or by way of reimbursement,
as may be provided in such agreement.
``(b) Requests for Information.--All Federal departments or
agencies administering Federal property on which children reside, and
all such departments or agencies principally responsible for Federal
activities which may occasion assistance under title I, shall to the
maximum extent practicable comply with requests of the Secretary for
information the Secretary may require in carrying out the purposes of
title I.
``SEC. 204. DEFINITIONS; ATTENDANCE DETERMINATION.
``(a) Definitions.--As used in this Act:
``(1) The term `Federal property' means real property which
is owned by the United States or is leased by the United
States, and which is not subject to taxation by any State or
any political subdivision of a State or by the District of
Columbia. Such term includes (A) except for purposes of section
106, real property held in trust by the United States for
individual Indians or Indian tribes, and real property held by
individual Indians or Indian tribes, which is subject to
restrictions on alienation imposed by the United States, (B)
for one year beyond the end of the fiscal year in which
occurred the sale or transfer thereof by the United States, any
property considered prior to such sale or transfer to be
Federal property for the purposes of this Act, (C) any low-rent
housing (whether or not owned by the United States) which is
part of a low-rent housing project assisted under the United
States Housing Act of 1937, section 516 of the Housing Act of
1949, or part B of title III of the Economic Opportunity Act of
1964, (D) any school which is providing flight training to
members of the Air Force under contractual arrangements with
the Department of the Air Force at an airport which is owned by
a State or a political subdivision of a State and (E) any
property owned by a foreign government or by an international
organization which by reason of such ownership is not subject
to taxation by the State in which it is located or a
subdivision thereof. Such term also includes any interest in
Federal property (as defined in the foregoing provisions of
this paragraph) under an easement, lease, license, permit, or
other arrangement, as well as any improvements of any nature
(other than pipelines or utility lines) on such property even
though such interests or improvements are subject to taxation
by a State or political subdivision of a State or by the
District of Columbia. Notwithstanding the foregoing provisions
of this paragraph, such term does not include any real property
under the jurisdiction of the United States Postal Service and
used primarily for the provision of postal service. Real
property which qualifies as Federal property under clause (A)
of this paragraph shall not lose such qualification because it
is used for a low-rent housing project. Any real property that
was designated by treaty as tribal land, or was formerly
property described under subparagraph (A) and is currently
owned by an Indian housing authority and used for low-rent
housing described in subparagraph (C) (including a mutual help
homeownership opportunity project assisted under section 202 of
the United States Housing Act of 1937), shall be deemed to
qualify as Federal property under subparagraph (A).
``(2) The term `child' means any child who is within the
age limits for which the applicable State provides free public
education.
``(3) The term `parent' includes a legal guardian or other
person standing in loco parentis.
``(4) The term `free public education' means education
which is provided at public expense, under public supervision
and direction, and without tuition charge, and which is
provided as preschool, kindergarten, elementary or secondary
school education in the applicable State.
``(5)(A) The term `current expenditures' means expenditures
for free public education, including expenditures for
administration, instruction, attendance and health services,
pupil transportation services, operation and maintenance of
plant, fixed charges, and net expenditures to cover deficits
for food services and student body activities, but not
including expenditures for community services, capital outlay,
and debt service, or any expenditures made of funds granted
under chapter 1 or chapter 2 of title I of the Elementary and
Secondary Education Act of 1965, the Indian Education Act of
1988 and the Johnson-O'Malley Act.
``(B) The determination of whether an expenditure for the
replacement of equipment is considered a current expenditure or
a capital outlay shall be determined in accordance with
generally accepted State accounting principles.
``(6)(A) For purposes of title I, the term `local
educational agency' means a board of education or other legally
constituted local school authority having administrative
control and direction of free public elementary and secondary
education through grade 12 in a county, township, independent,
or other school district located within a State. Such term
includes any State agency which directly operates and maintains
facilities for providing free public education. Such term does
not include any agency or school authority that the Secretary
determines on a case-by-case basis--
``(i) was constituted or reconstituted primarily
for the purpose of receiving assistance under this Act
or increasing the amount of that assistance;
``(ii) is not constituted or reconstituted for
legitimate educational purposes; or
``(iii) was previously part of a school district
upon being constituted or reconstituted.
``(B) For the purpose of carrying out the provisions of
section 103(a)(1)(B), such term includes any agency or school
authority that has had an arrangement with a nonadjacent school
district for the education of children of persons who reside or
work on an installation of the Department of Defense for more
than 25 years, but only if the Secretary determines that there
is no single school district adjacent to the school district in
which the installation is located that is capable of educating
all such children.
``(7) The term `State educational agency' means the officer
or agency primarily responsible for the State supervision of
public elementary and secondary schools.
``(8) The term `State' means a State, the Commonwealth of
Puerto Rico, Wake Island, Guam, the District of Columbia,
American Samoa, the Commonwealth of the Northern Mariana
Islands, or the Virgin Islands.
``(9) The term `Secretary' means the Secretary of
Education.
``(10) The term `county' means those divisions of a State
utilized by the Secretary of Commerce in compiling and
reporting data regarding counties.
``(11) The term `construction' includes the preparation of
drawings and specifications for school facilities; erecting,
building, acquiring, altering, remodeling, improving, or
extending school facilities; and the inspection and supervision
of the construction of school facilities.
``(12) The term `school facilities' means classrooms and
related facilities (including initial equipment) for free
public education and interests in land (including site,
grading, and improvements) on which such facilities are
constructed, except that such term does not include those
gymnasiums and similar facilities intended primarily for
exhibitions for which admission is to be charged to the general
public.
``(13) The term `equipment' includes machinery, utilities,
and built-in equipment and any necessary enclosures or
structures to house them, and includes all other items
necessary for the functioning of a particular facility as a
facility for the provision of educational services, including
items such as instructional equipment and necessary furniture,
printed, published, and audio-visual instructional materials,
and books, periodicals, documents, and other related materials.
``(b) Attendance Determination.--For the purpose of this Act,
average daily attendance shall be determined in accordance with State
law, except that (A) the average daily attendance of children with
respect to whom payment is to be made under section 103 or 104 of this
Act shall be determined in accordance with regulations of the
Secretary, and (B) notwithstanding any other provision of this Act,
where the local educational agency of the school district in which any
child resides makes or contracts to make a tuition payment for the free
public education of such child in a school situated in another school
district, for purposes of this Act the attendance of such child at such
school shall be held and considered (i) to be attendance at a school of
the local educational agency so making or contracting to make such
tuition payment and (ii) not to be attendance at a school of the local
educational agency receiving such tuition payment or entitled to
receive such payment under the contract. A child shall, for the
purposes of section 103, be deemed to be in attendance at a school of a
local educational agency if such child is determined to be federally
connected under section 103(a) for any fiscal year and if such child is
attending a school other than a school of such agency because such
child is a child with a disability (as such term is defined in section
602(a)(1) of the Individuals with Disabilities Education Act) and if
such agency makes a tuition payment on behalf of such child to such
school for such fiscal year. Regulations promulgated by the Secretary
in accordance with subparagraph (A) of this paragraph shall permit the
conversion of average daily membership to average daily attendance for
local educational agencies in States which reimburse local educational
agencies based upon average daily membership and which do not require
local educational agencies to keep records based on average daily
attendance.
``SEC. 205. REGULATION REQUIREMENTS.
``The Secretary is authorized to promulgate such regulations as the
Secretary considers necessary to reasonably ensure compliance with the
provisions of this Act in accordance with the procedures provided for
under section 1431 of the Elementary and Secondary Education Act of
1965.''.
<all>
S 874 IS----2
S 874 IS----3
S 874 IS----4
S 874 IS----5
S 874 IS----6
S 874 IS----7