(B) 48 percent of such expenditure in the United States. SEC. 1122. [20 U.S.C. 6332] ALLOCATIONS TO STATES. (a) ALLOCATION FORMULA. Of the amount appropriated under section 1002(a) to carry out this part for each of fiscal years 20022007 (referred to in this subsection as the current fiscal year)— (1) an amount equal to the amount made available to carry out section 1124 for fiscal year 2001 shall be allocated in accordance with section 1124; (2) an amount equal to the amount made available to carry out section 1124A for fiscal year 2001 shall be allocated in accordance with section 1124A; and (3) an amount equal to 100 percent of the amount, if any, by which the amount made available to carry out sections 1124, 1124A, and 1125 for the current fiscal year for which the determination is made exceeds the amount available to carry out sections 1124 and 1124A for fiscal year 2001 shall be allocated in accordance with section 1125. (b) ADJUSTMENTS WHERE NECESSITATED BY APPROPRIATIONS.— (1) IN GENERAL.-If the sums available under this subpart for any fiscal year are insufficient to pay the full amounts that all local educational agencies in States are eligible to receive under sections 1124, 1124A, and 1125 for such year, the Secretary shall ratably reduce the allocations to such local educational agencies, subject to subsections (c) and (d) of this section. (2) ADDITIONAL FUNDS.-If additional funds become available for making payments under sections 1124, 1124A, and 1125 for such fiscal year, allocations that were reduced under paragraph (1) shall be increased on the same basis as they were reduced. (c) HOLD-HARMLESS AMOUNTS.— (1) AMOUNTS FOR SECTIONS 1124, 1124A, AND 1125.-For each fiscal year, the amount made available to each local educational agency under each of sections 1124, 1124A, and 1125 shall be (A) not less than 95 percent of the amount made available for the preceding fiscal year if the number of children counted for grants under section 1124 is not less than 30 percent of the total number of children aged 5 to 17 years, inclusive, in the local educational agency; (B) not less than 90 percent of the amount made available for the preceding fiscal year if the percentage described in subparagraph (A) is between 15 percent and 30 percent; and (C) not less than 85 percent of the amount made available for the preceding fiscal year if the percentage described in subparagraph (A) is below 15 percent. (2) PAYMENTS.-If sufficient funds are appropriated, the amounts described in paragraph (1) shall be paid to all local educational agencies that received grants under section 1124A for the preceding fiscal year, regardless of whether the local educational agency meets the minimum eligibility criteria for that fiscal year described in section 1124A(a)(1)(A) except that a local educational agency that does not meet such minimum eligibility criteria for 4 consecutive years shall no longer be eligible to receive a hold harmless amount referred to in paragraph (1). (3) APPLICABILITY.-Notwithstanding any other provision of law, the Secretary shall not take into consideration the holdharmless provisions of this subsection for any fiscal year for purposes of calculating State or local allocations for the fiscal year under any program administered by the Secretary other than a program authorized under this part. (4) POPULATION DATA.-For any fiscal year for which the Secretary calculates grants on the basis of population data for counties, the Secretary shall apply the hold-harmless percentages in paragraphs (1) and (2) to counties and, if the Secretary's allocation for a county is not sufficient to meet the hold-harmless requirements of this subsection for every local educational agency within that county, the State educational agency shall reallocate funds proportionately from all other local educational agencies in the State that are receiving funds in excess of the hold-harmless amounts specified in this subsection. (d) RATABLE REDUCTIONS. (1) IN GENERAL.-If the sums made available under this subpart for any fiscal year are insufficient to pay the full amounts that local educational agencies in all States are eligible to receive under subsection (c) for such year, the Secretary shall ratably reduce such amounts for such year. (2) ADDITIONAL FUNDS.-If additional funds become available for making payments under subsection (c) for such fiscal year, amounts that were reduced under paragraph (1) shall be increased on the same basis as such amounts were reduced. (e) DEFINITION.-For the purpose of this section and sections 1124, 1124A, 1125, and 1125A, the term "State" means each of the 50 States, the District of Columbia, and the Commonwealth of Puerto Rico. SEC. 1124. [20 U.S.C. 6333] BASIC GRANTS TO LOCAL EDUCATIONAL AGENCIES. (a) AMOUNT OF GRANTS.— (1) GRANTS FOR LOCAL EDUCATIONAL AGENCIES AND PUERTO RICO. Except as provided in paragraph (4) and in section 1126, the grant that a local educational agency is eligible to receive under this section for a fiscal year is the amount determined by multiplying (A) the number of children counted under subsection (c); and (B) 40 percent of the average per-pupil expenditure in the State, except that the amount determined under this subparagraph shall not be less than 32 percent, or more than 48 percent, of the average per-pupil expenditure in the United States. (2) CALCULATION OF GRANTS.— (A) ALLOCATIONS TO LOCAL EDUCATIONAL AGENCIES.The Secretary shall calculate grants under this section on the basis of the number of children counted under subsection (c) for local educational agencies, unless the Sec retary and the Secretary of Commerce determine that some or all of those data are unreliable or that their use would be otherwise inappropriate, in which case (i) the two Secretaries shall publicly disclose the reasons for their determination in detail; and (ii) paragraph (3) shall apply. (B) ALLOCATIONS TO LARGE AND SMALL LOCAL EDUCATIONAL AGENCIES. (i) For any fiscal year to which this paragraph applies, the Secretary shall calculate grants under this section for each local educational agency. (ii) The amount of a grant under this section for each large local educational agency shall be the amount determined under clause (i). (iii) For small local educational agencies, the State educational agency may either— (I) distribute grants under this section in amounts determined by the Secretary under clause (i); or (II) use an alternative method approved by the Secretary to distribute the portion of the State's total grants under this section that is based on those small agencies. (iv) An alternative method under clause (iii)(II) shall be based on population data that the State educational agency determines best reflect the current distribution of children in poor families among the State's small local educational agencies that meet the eligibility criteria of subsection (b). (v) If a small local educational agency is dissatisfied with the determination of its grant by the State educational agency under clause (iii)(II), it may appeal that determination to the Secretary, who shall respond not later than 45 days after receipt of such appeal. (vi) As used in this subparagraph (I) the term "large local educational agency" means a local educational agency serving an area with a total population of 20,000 or more; and (II) the term "small local educational agency" means a local educational agency serving an area with a total population of less than 20,000. (3) ALLOCATIONS TO COUNTIES. (A) CALCULATION.-For any fiscal year to which this paragraph applies, the Secretary shall calculate grants under this section on the basis of the number of children counted under subsection (c) for counties, and State educational agencies shall suballocate county amounts to local educational agencies, in accordance with regulations issued by the Secretary. (B) DIRECT ALLOCATIONS.-In any State in which a large number of local educational agencies overlap county boundaries, or for which the State believes it has data that would better target funds than allocating them by county, the State educational agency may apply to the Secretary for authority to make the allocations under this subpart for a particular fiscal year directly to local educational agencies without regard to counties. (C) ALLOCATIONS TO LOCAL EDUCATIONAL AGENCIES.If the Secretary approves the State educational agency's application under subparagraph (B), the State educational agency shall provide the Secretary an assurance that such allocations shall be made (i) using precisely the same factors for determining a grant as are used under this subpart; or (ii) using data that the State educational agency submits to the Secretary for approval that more accurately target poverty. (D) APPEAL.-The State educational agency shall provide the Secretary an assurance that it will establish a procedure through which a local educational agency that is dissatisfied with its determinations under subparagraph (B) may appeal directly to the Secretary for a final determination. (4) PUERTO RICO.— (A) IN GENERAL.-For each fiscal year, the grant that the Commonwealth of Puerto Rico shall be eligible to receive under this section shall be the amount determined by multiplying the number of children counted under subsection (c) for the Commonwealth of Puerto Rico by the product of (i) subject to subparagraph (B), the percentage that the average per-pupil expenditure in the Commonwealth of Puerto Rico is of the lowest average perpupil expenditure of any of the 50 States; and (ii) 32 percent of the average per-pupil expenditure in the United States. (B) MINIMUM PERCENTAGE.-The percentage in subparagraph (A)(i) shall not be less than (i) for fiscal year 2002, 77.5 percent; (v) for fiscal year 2006, 92.5 percent; and (vi) for fiscal year 2007 and succeeding fiscal years, 100.0 percent. (C) LIMITATION.-If the application of subparagraph (B) would result in any of the 50 States or the District of Columbia receiving less under this subpart than it received under this subpart for the preceding fiscal year, the percentage in subparagraph (A) shall be the greater of(i) the percentage in subparagraph (A)(i); (ii) the percentage specified in subparagraph (B) for the preceding fiscal year; or (iii) the percentage used for the preceding fiscal year. (b) MINIMUM NUMBER OF CHILDREN TO QUALIFY.-A local educational agency is eligible for a basic grant under this section for any fiscal year only if the number of children counted under subsection (c) for that agency is both (1) 10 or more; and (2) more than 2 percent of the total school-age population in the agency's jurisdiction. (c) CHILDREN TO BE COUNTED.— (1) CATEGORIES OF CHILDREN.-The number of children to be counted for purposes of this section is the aggregate of (A) the number of children aged 5 to 17, inclusive, in the school district of the local educational agency from families below the poverty level as determined under paragraph (2); (B) the number of children (determined under paragraph (4) for either the preceding year as described in that paragraph, or for the second preceding year, as the Secretary finds appropriate) aged 5 to 17, inclusive, in the school district of such agency in institutions for neglected and delinquent children (other than such institutions operated by the United States), but not counted pursuant to subpart 1 of part D for the purposes of a grant to a State agency, or being supported in foster homes with public funds; and (C) the number of children aged 5 to 17, inclusive, in the school district of such agency from families above the poverty level as determined under paragraph (4). (2) DETERMINATION OF NUMBER OF CHILDREN.-For the purposes of this section, the Secretary shall determine the number of children aged 5 to 17, inclusive, from families below the poverty level on the basis of the most recent satisfactory data, described in paragraph (3), available from the Department of Commerce. The District of Columbia and the Commonwealth of Puerto Rico shall be treated as individual local educational agencies. If a local educational agency contains two or more counties in their entirety, then each county will be treated as if such county were a separate local educational agency for purposes of calculating grants under this part. The total of grants for such counties shall be allocated to such a local educational agency, which local educational agency shall distribute to schools in each county within such agency a share of the local educational agency's total grant that is no less than the county's share of the population counts used to calculate the local educational agency's grant. (3) POPULATION UPDATES. (A) IN GENERAL.-In fiscal year 2002 and each subsequent fiscal year, the Secretary shall use updated data on the number of children, aged 5 to 17, inclusive, from families below the poverty level for counties or local educational agencies, published by the Department of Commerce, unless the Secretary and the Secretary of Commerce determine that the use of the updated population data would be inappropriate or unreliable. If appropriate and reliable data are not available annually, the Secretary shall use data which are updated every 2 years. (B) INAPPROPRIATE OR UNRELIABLE DATA.-If the Secretary and the Secretary of Commerce determine that some or all of the data referred to in subparagraph (A) are inappropriate or unreliable, the Secretary and the Secretary of Commerce shall publicly disclose their reasons. |