(a) Computation of payment

(1) In general

For the purpose of computing the amount that a local educational agency is eligible to receive under subsection (b) or (d) for any fiscal year, the Secretary shall determine the number of children who were in average daily attendance in the schools of such agency, and for whom such agency provided free public education, during the preceding school year and who, while in attendance at such schools—

(A)(i) resided on Federal property with a parent employed on Federal property situated in whole or in part within the boundaries of the school district of such agency; or

(ii) resided on Federal property with a parent who is an official of, and accredited by, a foreign government and is a foreign military officer;

(B) resided on Federal property and had a parent on active duty in the uniformed services (as defined in section 101 of title 37);

(C) resided on Indian lands;

(D)(i) had a parent on active duty in the uniformed services (as defined by section 101 of title 37) but did not reside on Federal property; or

(ii) had a parent who is an official of, and has been accredited by, a foreign government and is a foreign military officer but did not reside on Federal property;

(E) resided in low-rent housing;

(F) resided on Federal property and is not described in subparagraph (A) or (B); or

(G) resided with a parent employed on Federal property situated—

(i) in whole or in part in the county in which such agency is located, or in whole or in part in such agency if such agency is located in more than one county; or

(ii) if not in such county, in whole or in part in the same State as such agency.

(2) Determination of weighted student units

For the purpose of computing the basic support payment under subsection (b), the Secretary shall calculate the total number of weighted student units for a local educational agency by adding together the results obtained by the following computations:

(A) Multiply the number of children described in subparagraphs (A) and (B) of paragraph (1) by a factor of 1.0.

(B) Multiply the number of children described in paragraph (1)(C) by a factor of 1.25.

(C) Multiply the number of children described in subparagraphs (A) and (B) of paragraph (1) by a factor of .35 if the local educational agency has—

(i) a number of such children described in such subparagraphs which exceeds 5,000; and

(ii) an average daily attendance for all children which exceeds 100,000.

(D) Multiply the number of children described in subparagraph (D) of paragraph (1) by a factor of .20.

(E) Multiply the number of children described in subparagraph (E) of paragraph (1) by a factor of .10.

(F) Multiply the number of children described in subparagraphs (F) and (G) of paragraph (1) by a factor of .05.

(3) Special rule

The Secretary shall only compute a payment for a local educational agency for children described in subparagraph (F) or (G) of paragraph (1) if the number of such children equals or exceeds 1,000 or such number equals or exceeds 10 percent of the total number of students in average daily attendance in the schools of such agency.

(4) Military installation and Indian housing undergoing renovation or rebuilding

(A) Military installation housing

Beginning in fiscal year 2014, in determining the amount of a payment for a local educational agency for children described in paragraph (1)(D)(i), the Secretary shall consider those children as if they were children described in paragraph (1)(B) if the Secretary determines, on the basis of a certification provided to the Secretary by a designated representative of the Secretary of Defense, that those children would have resided in housing on Federal property if the housing was not undergoing renovation or rebuilding. The total number of children treated as children described in paragraph (1)(B) shall not exceed the lessor of—

(i) the total number of children eligible under paragraph (1)(B) for the year prior to the initiation of the housing project on Federal property undergoing renovation or rebuilding; or

(ii) the total number of Federally connected children enrolled at the local educational agency as stated in the application filed for the payment for the year for which the determination is made.

(B) Indian lands

Beginning in fiscal year 2014, in determining the amount of a payment for a local educational agency that received a payment for children that resided on Indian lands in accordance with paragraph (1)(C) for the fiscal year prior to the fiscal year for which the local educational agency is making an application, the Secretary shall consider those children to be children described in paragraph (1)(C) if the Secretary determines on the basis of a certification provided to the Secretary by a designated representative of the Secretary of the Interior or the Secretary of Housing and Urban Development that those children would have resided in housing on Indian lands if the housing was not undergoing renovation or rebuilding. The total number of children treated as children described in paragraph (1)(C) shall not exceed the lessor of—

(i) the total number of children eligible under paragraph (1)(C) for the year prior to the initiation of the housing project on Indian lands undergoing renovation or rebuilding; or

(ii) the total number of Federally connected children enrolled at the local educational agency as stated in the application filed for the payment for the year for which the determination is made.

(C) Eligible housing

Renovation or rebuilding shall be defined as projects considered as capitalization, modernization, or restoration, as defined by the Secretary of Defense or the Secretary of the Interior (as the case may be) and are projects that last more than 30 days, but do not include “sustainment projects” such as painting, carpeting, or minor repairs.

(5) Military “Build to Lease” program housing

(A) In general

For purposes of computing the amount of payment for a local educational agency for children identified under paragraph (1), the Secretary shall consider children residing in housing initially acquired or constructed under the former section 2828(g) of title 10 (commonly known as the “Build to Lease” program), as added by section 801 of the Military Construction Authorization Act, 1984, or under lease of off-base property under subchapter IV of chapter 169 of title 10, to be children described under paragraph (1)(B), if the property described is—

(i) within the fenced security perimeter of the military facility; or

(ii) attached to, and under any type of force protection agreement with, the military installation upon which such housing is situated.

(B) Additional requirements

If the property described in subparagraph (A) is not owned by the Federal Government, is subject to taxation by a State or political subdivision of a State, and thereby generates revenues for a local educational agency that is applying to receive a payment under this section, then the Secretary—

(i) shall require the local educational agency to provide certification from an appropriate official of the Department of Defense that the property is being used to provide military housing; and

(ii) shall reduce the amount of the payment under this section by an amount equal to the amount of revenue from such taxation received in the second preceding fiscal year by such local educational agency, unless the amount of such revenue was taken into account by the State for such second preceding fiscal year and already resulted in a reduction in the amount of State aid paid to such local educational agency.

(b) Basic support payments; insufficient appropriations; State with only one local educational agency

(1) Basic support payments

(A) In general

From the amount appropriated under section 7714(b) of this title for a fiscal year, the Secretary is authorized to make basic support payments to eligible local educational agencies with children described in subsection (a).

(B) Eligibility

A local educational agency is eligible to receive a basic support payment under subparagraph (A) for a fiscal year with respect to a number of children determined under subsection (a)(1) only if the number of children so determined with respect to such agency amounts to the lesser of—

(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 such year, at the schools of such agency and for whom such agency provided free public education.

(C) Maximum amount

The maximum amount that a local educational agency is eligible to receive under this paragraph for any fiscal year is the sum of the total weighted student units, as computed under subsection (a)(2), multiplied by the greater of—

(i) one-half of the average per-pupil expenditure of the State in which the local educational agency is located for the third fiscal year preceding the fiscal year for which the determination is made;

(ii) one-half of the average per-pupil expenditure of all of the States for the third fiscal year preceding the fiscal year for which the determination is made;

(iii) the comparable local contribution rate certified by the State, as determined under regulations prescribed to carry out the Act of September 30, 1950 (Public Law 874, 81st Congress), as such regulations were in effect on January 1, 1994; or

(iv) the average per-pupil expenditure of the State in which the local educational agency is located, multiplied by the local contribution percentage.

(D) Data

If satisfactory data from the third preceding fiscal year are not available for any of the expenditures described in clause (i) or (ii) of subparagraph (C), the Secretary shall use data from the most recent fiscal year for which data that are satisfactory to the Secretary are available.

(E) Increase in local contribution rate due to unusual geographic factors

If the current expenditures in those local educational agencies which the Secretary has determined to be generally comparable to the local educational agency for which a computation is made under subparagraph (C) are not reasonably comparable because of unusual geographical factors which affect the current expenditures necessary to maintain, in such agency, a level of education equivalent to that maintained in such other agencies, then the Secretary shall increase the local contribution rate for such agency under subparagraph (C)(iii) 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.

(F) Beginning with fiscal year 2002, for the purpose of calculating a payment under this paragraph for a local educational agency whose local contribution rate was computed under subparagraph (C)(iii) for the previous year, the Secretary shall use a local contribution rate that is not less than 95 percent of the rate that the LEA received for the preceding year.

(2) Basic support payments for heavily impacted local educational agencies

(A) In general

(i) From the amount appropriated under section 7714(b) of this title for a fiscal year, the Secretary is authorized to make basic support payments to eligible heavily impacted local educational agencies with children described in subsection (a).

(ii) A local educational agency that receives a basic support payment under this paragraph for a fiscal year shall not be eligible to receive a basic support payment under paragraph (1) for that fiscal year.

(B) Eligibility for heavily impacted local educational agencies

(i) In general

A heavily impacted local educational agency is eligible to receive a basic support payment under subparagraph (A) with respect to a number of children determined under subsection (a)(1) if the agency—

(I) is a local educational agency—

(aa) whose boundaries are the same as a Federal military installation; or

(bb)(AA) whose boundaries are the same as an island property designated by the Secretary of the Interior to be property that is held in trust by the Federal Government; and

(BB) that has no taxing authority;

(II) is a local educational agency that—

(aa) has an enrollment of children described in subsection (a)(1) that constitutes a percentage of the total student enrollment of the agency that is not less than 45 percent;

(bb) has a per-pupil expenditure that is less than—

(AA) for an agency that has a total student enrollment of 500 or more students, 125 percent of the average per-pupil expenditure of the State in which the agency is located; or

(BB) for any agency that has a total student enrollment of less than 500 students, 150 percent of the average per-pupil expenditure of the State in which the agency is located or the average per-pupil expenditure of 3 or more comparable local educational agencies in the State in which the agency is located; and

(cc) is an agency that has a tax rate for general fund purposes that is not less than 95 percent of the average tax rate for general fund purposes of comparable local educational agencies in the State;

(III) is a local educational agency that—

(aa) has a tax rate for general fund purposes which is not less than 125 percent of the average tax rate for general fund purposes for comparable local educational agencies in the State;

(bb)(AA) has an enrollment of children described in subsection (a)(1) that constitutes a percentage of the total student enrollment of the agency that is not less than 30 percent; or

(BB) has an enrollment of children described in subsection (a)(1) that constitutes a percentage of the total student enrollment of the agency that is not less than 20 percent, and for the 3 fiscal years preceding the fiscal year for which the determination is made, the average enrollment of children who are not described in subsection (a)(1) and who are eligible for a free or reduced price lunch under the Richard B. Russell National School Lunch Act [42 U.S.C. 1751 et seq.] constitutes a percentage of the total student enrollment of the agency that is not less than 65 percent and received assistance for fiscal year 2017 pursuant to subparagraph (G); and

(cc) received assistance under subparagraph (A) of section 7703(b)(2) of this title,¹ as such section was in effect on the day before December 10, 2015, for a fiscal year prior to fiscal year 2017;

(IV) is a local educational agency that received a payment for fiscal year 2015 under section 7703(b)(2)(E) ¹ of this title (as such section was in effect for such fiscal year) and has a total student enrollment of not less than 25,000 students, of which—

(aa) not less than 35 percent are children described in subsection (a)(1); and

(bb)(AA) not less than 3,500 of such children are children described in subparagraphs (A) and (B) of subsection (a)(1); or

(BB) not less than 7,000 of such children are children described in subparagraph (D) of subsection (a)(1);

(V) is a local educational agency that—

(aa) has an enrollment of children described in subsection (a)(1) including, for purposes of determining eligibility, those children described in subparagraphs (F) and (G) of such subsection, that is not less than 35 percent of the total student enrollment of the agency;

(bb) has a per-pupil expenditure described in subclause (II)(bb) (except that a local educational agency with a total student enrollment of less than 350 students shall be deemed to have satisfied such per-pupil expenditure requirement) and has a tax rate for general fund purposes which is not less than 95 percent of the average tax rate for general fund purposes for comparable local educational agencies in the State; and

(cc) was eligible to receive assistance under subparagraph (A) for fiscal year 2001.

(ii) Loss of eligibility

(I) In general

Subject to subclause (II), a heavily impacted local educational agency that met the requirements of clause (i) for a fiscal year shall be ineligible to receive a basic support payment under subparagraph (A) if the agency fails to meet the requirements of clause (i) for a subsequent fiscal year, except that such agency shall continue to receive a basic support payment under this paragraph for the fiscal year for which the ineligibility determination is made.

(II) Loss of eligibility due to falling below 95 percent of the average tax rate for general fund purposes

In the case of a heavily impacted local educational agency described in subclause (II) or (V) of clause (i) that is eligible to receive a basic support payment under subparagraph (A), but that has had, for 2 consecutive fiscal years, a tax rate for general fund purposes that falls below 95 percent of the average tax rate for general fund purposes of comparable local educational agencies in the State, such agency shall be determined to be ineligible under clause (i) and ineligible to receive a basic support payment under subparagraph (A) for each fiscal year succeeding such 2 consecutive fiscal years for which the agency has such a tax rate for general fund purposes, and until the fiscal year for which the agency resumes such eligibility in accordance with clause (iii).

(III) Taken over by State board of education

In the case of a heavily impacted local educational agency that is eligible to receive a basic support payment under subparagraph (A), but that has been taken over by a State board of education in any 2 previous years, such agency shall be deemed to maintain heavily impacted status for 2 fiscal years following December 10, 2015.

(iii) Eligibility

(I) First time

A local educational agency seeking a payment under this paragraph for the first time shall apply for and be determined eligible under clause (i) for 2 consecutive years before receiving such a payment, and shall not receive such a payment for the first year of eligibility.

(II) Resumption of eligibility

A heavily impacted local educational agency described in clause (i) that becomes ineligible under such clause for 1 or more fiscal years may resume eligibility for a basic support payment under this paragraph for a subsequent fiscal year only if the agency meets the requirements of clause (i) for that subsequent fiscal year, except that such agency shall not receive a basic support payment under this paragraph until the fiscal year succeeding the fiscal year for which the eligibility determination is made.

(C) Maximum amount for heavily impacted local educational agencies

(i) In general

Except as provided in subparagraph (D), the maximum amount that a heavily impacted local educational agency is eligible to receive under this paragraph for any fiscal year is the sum of the total weighted student units, as computed under subsection (a)(2) and subject to clause (ii), multiplied by the greater of—

(I) four-fifths of the average per-pupil expenditure of the State in which the local educational agency is located for the third fiscal year preceding the fiscal year for which the determination is made; or

(II) four-fifths of the average per-pupil expenditure of all of the States for the third fiscal year preceding the fiscal year for which the determination is made.

(ii) Calculation of weighted student units

(I) In general

(aa) Percentage enrollment

For a local educational agency in which 35 percent or more of the total student enrollment of the schools of the agency are children described in subparagraph (D) or (E) (or a combination thereof) of subsection (a)(1), and that has an enrollment of children described in subparagraph (A), (B), or (C) of such subsection equal to at least 10 percent of the agency’s total enrollment, the Secretary shall calculate the weighted student units of those children described in subparagraph (D) or (E) of such subsection by multiplying the number of such children by a factor of 0.55.

(bb) Exception

Notwithstanding item (aa), a local educational agency that received a payment under this paragraph for fiscal year 2013 shall not be required to have an enrollment of children described in subparagraph (A), (B), or (C) of subsection (a)(1) equal to at least 10 percent of the agency’s total enrollment and shall be eligible for the student weight as provided for in item (aa).

(II) Enrollment of 100 or fewer children

For a local educational agency that has an enrollment of 100 or fewer children described in subsection (a)(1), the Secretary shall calculate the total number of weighted student units for purposes of subsection (a)(2) by multiplying the number of such children by a factor of 1.75.

(III) Enrollment of more than 100 children but less than 1000

For a local educational agency that is not described under subparagraph (B)(i)(I) and has an enrollment of more than 100 but not more than 1,000 children described in subsection (a)(1), the Secretary shall calculate the total number of weighted student units for purposes of subsection (a)(2) by multiplying the number of such children by a factor of 1.25.

(D) Maximum amount for large heavily impacted local educational agencies

(i) In general

(I) Formula

Subject to clauses (ii), (iii), and (iv), the maximum amount that a heavily impacted local educational agency described in subclause (II) is eligible to receive under this paragraph for any fiscal year shall be determined in accordance with the formula described in paragraph (1)(C).

(II) Heavily impacted local educational agency

A heavily impacted local educational agency described in this subclause is a local educational agency that received a payment for fiscal year 2015 under section 7703(b)(2)(E) ¹ of this title (as such section was in effect for such fiscal year) and has a total student enrollment of not less than 25,000 students, of which not less than 35 percent are children described in subsection (a)(1) and—

(aa) not less than 3,500 of such children are children described in subparagraphs (A) and (B) of subsection (a)(1); or

(bb) not less than 7,000 of such children are children described in subparagraph (D) of subsection (a)(1).

(ii) Factor

For purposes of calculating the maximum amount described in clause (i), the factor used in determining the weighted student units under subsection (a)(2) with respect to children described in subparagraphs (A) and (B) of subsection (a)(1) shall be—

(I) for fiscal year 2016, 1.35;

(II) for each of fiscal years 2017 and 2018, 1.38;

(III) for fiscal year 2019, 1.40;

(IV) for fiscal year 2020, 1.42; and

(V) for fiscal year 2021 and each fiscal year thereafter, 1.45.

(iii) Factor for children who live off base

For purposes of calculating the maximum amount described in clause (i), the factor used in determining the weighted student units under subsection (a)(2) with respect to children described in subsection (a)(1)(D) shall be—

(I) for fiscal year 2016, .20;

(II) for each of fiscal years 2017 and 2018, .22;

(III) for each of fiscal years 2019 and 2020, .25; and

(IV) for fiscal year 2021 and each fiscal year thereafter—

(aa) .30 with respect to each of the first 7,000 children; and

(bb) .25 with respect to the number of children that exceeds 7,000.

(iv) Special rule

Notwithstanding clauses (ii) and (iii), for fiscal year 2020 or any succeeding fiscal year, if the number of students who are children described in subparagraphs (A) and (B) of subsection (a)(1) for a local educational agency subject to this subparagraph exceeds 7,000 for such year or the number of students who are children described in subsection (a)(1)(D) for such local educational agency exceeds 12,750 for such year, then—

(I) the factor used, for the fiscal year for which the determination is being made, to determine the weighted student units under subsection (a)(2) with respect to children described in subparagraphs (A) and (B) of subsection (a)(1) shall be 1.40; and

(II) the factor used, for such fiscal year, to determine the weighted student units under subsection (a)(2) with respect to children described in subsection (a)(1)(D) shall be .20.

(E) Data

For purposes of providing assistance under this paragraph, the Secretary shall use student, revenue, expenditure, and tax data from the third fiscal year preceding the fiscal year for which the local educational agency is applying for assistance under this paragraph.

(F) Determination of average tax rates for general fund purposes

(i) In general

Except as provided in clause (ii), for the purpose of determining the average tax rates for general fund purposes for local educational agencies in a State under this paragraph, the Secretary shall use either—

(I) the average tax rate for general fund purposes for comparable local educational agencies, as determined by the Secretary in regulations; or

(II) the average tax rate of all the local educational agencies in the State.

(ii) Fiscal years 2010-2015

(I) In general

For fiscal years 2010 through 2015, any local educational agency that was found ineligible to receive a payment under subparagraph (A) because the Secretary determined that it failed to meet the average tax rate requirement for general fund purposes in subparagraph (B)(i)(II)(cc), shall be considered to have met that requirement, if its State determined, through an alternate calculation of average tax rates for general fund purposes, that such local educational agency met that requirement.

(II) Subsequent fiscal years after 2015

For any succeeding fiscal year after 2015, any local educational agency identified in subclause (I) may continue to have its State use that alternate methodology to calculate whether the average tax rate requirement for general fund purposes under subparagraph (B)(i)(II)(cc) is met.

(III) Availability of funds

Notwithstanding any other provision of law limiting the period during which the Secretary may obligate funds appropriated for any fiscal year after 2012, the Secretary shall reserve a total of $14,000,000 from funds that remain unobligated under this section from fiscal years 2015 or 2016 in order to make payments under this clause for fiscal years 2011 through 2014.

(G) Eligibility for heavily impacted local educational agencies affected by privatization of military housing

(i) Eligibility

For any fiscal year, a heavily impacted local educational agency that received a basic support payment under this paragraph for the prior fiscal year, but is ineligible for such payment for the current fiscal year under subparagraph (B) due to the conversion of military housing units to private housing described in clause (iii), or as the direct result of base realignment and closure or modularization as determined by the Secretary of Defense and force structure change or force relocation, shall be deemed to meet the eligibility requirements under subparagraph (B) for the period during which the housing units are undergoing such conversion or during such time as activities associated with base closure and realignment, modularization, force structure change, or force relocation are ongoing.

(ii) Amount of payment

The amount of a payment to a heavily impacted local educational agency for a fiscal year by reason of the application of clause (i), and calculated in accordance with subparagraph (C) or (D), as the case may be, shall be based on the number of children in average daily attendance in the schools of such agency for the fiscal year and under the same provisions of subparagraph (C) or (D) under which the agency was paid during the prior fiscal year.

(iii) Conversion of military housing units to private housing described

For purposes of clause (i), “conversion of military housing units to private housing” means the conversion of military housing units to private housing units pursuant to subchapter IV of chapter 169 of title 10 or pursuant to any other related provision of law.

(3) Payments with respect to fiscal years in which insufficient funds are appropriated

(A) In general

For any fiscal year in which the sums appropriated under section 7714(b) of this title are insufficient to pay to each local educational agency the full amount computed under paragraphs (1) and (2), the Secretary shall make payments in accordance with this paragraph.

(B) Learning opportunity threshold payments in lieu of payments under paragraph (1)

(i) For fiscal years described in subparagraph (A), the Secretary shall compute a learning opportunity threshold payment (hereafter in this subchapter referred to as the “threshold payment”) in lieu of basic support payments under paragraph (1) by multiplying the amount obtained under paragraph (1)(C) by the total percentage obtained by adding—

(I) the percentage of federally connected children for each local educational agency determined by calculating the fraction, the numerator of which is the total number of children described under subsection (a)(1) and the denominator of which is the total number of children in average daily attendance at the schools served by such agency; and

(II) the percentage that funds under paragraph (1)(C) represent of the total budget of the local educational agency, determined by calculating the fraction, the numerator of which is the total amount of funds calculated for each local educational agency under this paragraph, and the denominator of which is the total current expenditures for such agency in the second preceding fiscal year for which the determination is made.

(ii) Such total percentage used to calculate threshold payments under paragraph (1) shall not exceed 100.

(iii) In the case of a local educational agency providing a free public education to students enrolled in kindergarten through grade 12, that enrolls students described in subparagraphs (A), (B), and (D) of subsection (a)(1) only in grades 9 through 12, and that received a final payment for fiscal year 2009 calculated under section 7703(b)(3) of this title (as such section was in effect on the day before December 10, 2015) for students in grades 9 through 12, the Secretary shall, in calculating the agency’s payment, consider only that portion of such agency’s total enrollment of students in grades 9 through 12 when calculating the percentage under clause (i)(I) and only that portion of the total current expenditures attributed to the operation of grades 9 through 12 in such agency when calculating the percentage under clause (i)(II).

(iv) In the case of a local educational agency that has a total student enrollment of fewer than 1,000 students and that has a per-pupil expenditure that is less than the average per-pupil expenditure of the State in which the agency is located or less than the average per-pupil expenditure of all the States, the total percentage used to calculate threshold payments under clause (i) shall not be less than 40 percent.

(C) Learning opportunity threshold payments in lieu of payments under paragraph (2)

For fiscal years described in subparagraph (A), the learning opportunity threshold payment in lieu of basic support payments under paragraph (2) shall be equal to the amount obtained under subparagraph (C) or (D) of paragraph (2), as the case may be.

(D) Ratable distribution

For fiscal years described in subparagraph (A), for which the sums available exceed the amount required to pay each local educational agency 100 percent of its threshold payment, the Secretary shall distribute the excess sums to each eligible local educational agency that has not received its full amount computed under paragraphs (1) or (2) (as the case may be) by multiplying—

(i) a percentage, the denominator of which is the difference between the full amount computed under paragraph (1) or (2) (as the case may be) for all local educational agencies and the amount of the threshold payment (as calculated under subparagraphs (B) and (C)) of all local educational agencies, and the numerator of which is the aggregate of the excess sums, by

(ii) the difference between the full amount computed under paragraph (1) or (2) (as the case may be) for the agency and the amount of the threshold payment (as calculated under subparagraphs (B) or (C)) of the agency, except that no local educational agency shall receive more than 100 percent of the maximum payment calculated under subparagraph (C) or (D) of paragraph (2).

(E) Insufficient payments

For each fiscal year described in subparagraph (A) for which the sums appropriated are insufficient to pay each local educational agency all of the local educational agency’s threshold payment described in subparagraph (B), the Secretary shall ratably reduce the payment to each local educational agency under this paragraph.

(F) Increases

(i) Increases based on insufficient funds

If additional funds become available under 7714(b) of this title for making payments under paragraphs (1) and (2) and those funds are not sufficient to increase each local educational agency’s threshold payment above 100 percent of its threshold payment described in subparagraph (B), payments that were reduced under subparagraph (E) shall be increased by the Secretary on the same basis as such payments were reduced.

(ii) Increases based on sufficient funds

If additional funds become available under section 7714(b) of this title for making payments under paragraphs (1) and (2) and those funds are sufficient to increase each local educational agency’s threshold payment above 100 percent of its threshold payment described in subparagraph (B), the payment for each local educational agency shall be 100 percent of its threshold payment. The Secretary shall then distribute the excess sums to each eligible local educational agency in accordance with subparagraph (D).

(G) Provision of tax rate and resulting percentage

As soon as practicable following the payment of funds under paragraph (2) to an eligible local educational agency, the Secretary shall provide the local educational agency with a description of—

(i) the tax rate of the local educational agency; and

(ii) the percentage such tax rate represents of the average tax rate for general fund purposes of comparable local educational agencies in the State as determined under subclauses (II)(cc), III(aa), or (V)(bb) of paragraph (2)(B)(i) (as the case may be).

(4) States with only one local educational agency

(A) In general

In any of the 50 States of the United States in which there is only one local educational agency, the Secretary shall, for purposes of subparagraphs (B) and (C) of paragraph (1) or subparagraphs (B) and (C) of paragraph (2), as the case may be, paragraph (3) of this subsection, and subsection (e), consider each administrative school district in the State to be a separate local educational agency.

(B) Computation of maximum amount of basic support payment and threshold payment

In computing the maximum payment amount under paragraph (1)(C) or subparagraph (C) or (D) of paragraph (2), as the case may be, and the learning opportunity threshold payment under subparagraph (B) or (C) of paragraph (3), as the case may be, for an administrative school district described in subparagraph (A)—

(i) the Secretary shall first determine the maximum payment amount and the total current expenditures for the State as a whole; and

(ii) the Secretary shall then—

(I) proportionately allocate such maximum payment amount among the administrative school districts on the basis of the respective weighted student units of such districts; and

(II) proportionately allocate such total current expenditures among the administrative school districts on the basis of the respective number of students in average daily attendance at such districts.

(5) Local educational agencies affected by removal of Federal property

(A) In general

In computing the amount of a basic support payment under this subsection for a fiscal year for a local educational agency described in subparagraph (B), the Secretary shall meet the additional requirements described in subparagraph (C).

(B) Local educational agency described

A local educational agency described in this subparagraph is a local educational agency with respect to which Federal property (i) located within the boundaries of the agency, and (ii) on which one or more children reside who are receiving a free public education at a school of the agency, is transferred by the Federal Government to another entity in any fiscal year beginning on or after October 30, 2000, so that the property is subject to taxation by the State or a political subdivision of the State.

(C) Additional requirements

The additional requirements described in this subparagraph are the following:

(i) For each fiscal year beginning after the date on which the Federal property is transferred, a child described in subparagraph (B) who continues to reside on such property and who continues to receive a free public education at a school of the agency shall be deemed to be a child who resides on Federal property for purposes of computing under the applicable subparagraph of subsection (a)(1) the amount that the agency is eligible to receive under this subsection.

(ii)(I) For the third fiscal year beginning after the date on which the Federal property is transferred, and for each fiscal year thereafter, the Secretary shall, after computing the amount that the agency is otherwise eligible to receive under this subsection for the fiscal year involved, deduct from such amount an amount equal to the revenue received by the agency for the immediately preceding fiscal year as a result of the taxable status of the former Federal property.

(II) For purposes of determining the amount of revenue to be deducted in accordance with subclause (I), the local educational agency—

(aa) shall provide for a review and certification of such amount by an appropriate local tax authority; and

(bb) shall submit to the Secretary a report containing the amount certified under item (aa).

(c) Prior year data

(1) In general

Except as provided in subsections (b)(1)(D), (b)(2), and paragraph (2), all calculations under this section shall be based on data for each local educational agency from not later than the fiscal year preceding the fiscal year for which the agency is making application for payment.

(2) Exception

Calculation of payments for a local educational agency shall be based on data from the fiscal year for which the agency is making an application for payment if such agency—

(A) is newly established by a State, for the first year of operation of such agency only;

(B) was eligible to receive a payment under this section for the previous fiscal year and has had an overall increase in enrollment (as determined by the Secretary in consultation with the Secretary of Defense, the Secretary of the Interior, or the heads of other Federal agencies)—

(i)(I) of not less than 10 percent of children described in—

(aa) subparagraph (A), (B), (C), or (D) of subsection (a)(1); or

(bb) subparagraphs (F) and (G) of subsection (a)(1), but only to the extent that such children are civilian dependents of employees of the Department of Defense or the Department of the Interior; or

(II) of not less than 100 of such children; and

(ii) that is the direct result of closure or realignment of military installations under the base closure process or the relocation of members of the Armed Forces and civilian employees of the Department of Defense as part of the force structure changes or movements of units or personnel between military installations or because of actions initiated by the Secretary of the Interior or the head of another Federal agency; or

(C) was eligible to receive a payment under this section for the previous fiscal year and has had an increase in enrollment (as determined by the Secretary)—

(i) of not less than 10 percent of children described in subsection (a)(1) or not less than 100 of such children; and

(ii) that is the direct result of the closure of a local educational agency that received a payment under subsection (b)(1) or (b)(2) for the previous fiscal year.

(d) Children with disabilities

(1) In general

From the amount appropriated under section 7714(c) of this title for a fiscal year, the Secretary shall pay to each eligible local educational agency, on a pro rata basis, the amounts determined by—

(A) multiplying the number of children described in subparagraphs (A)(ii), (B) and (C) of subsection (a)(1) who are eligible to receive services under the Individuals with Disabilities Education Act (20 U.S.C. 1400 et seq.) by a factor of 1.0; and

(B) multiplying the number of children described in subparagraph (D) of subsection (a)(1) who are eligible to receive services under such Act by a factor of 0.5.

(2) Use of funds

A local educational agency that receives funds under paragraph (1) shall use such funds to provide a free appropriate public education to children described in paragraph (1) in accordance with the Individuals with Disabilities Education Act (20 U.S.C. 1400 et seq.).

(e) Hold harmless

(1) In general

In the case of any local educational agency eligible to receive a payment under subsection (b) whose calculated payment amount for a fiscal year is reduced by 20 percent, as compared to the amount received for the previous fiscal year, the Secretary shall pay the local educational agency, for the year of the reduction and the following 2 years, the amount determined under paragraph (2).

(2) Amount of reduction

Subject to paragraph (3), A local educational agency described in paragraph (1) shall receive—

(A) for the first year for which the reduced payment is determined, an amount that is not less than 90 percent of the total amount that the local educational agency received under subsection (b) for the previous fiscal year;

(B) for the second year following such reduction, an amount that is not less than 85 percent of the total amount that the local educational agency received under subparagraph (A); and

(C) for the third year following such reduction, an amount that is not less than 80 percent of the total amount that the local educational agency received under subparagraph (B).

(3) Special rule

For any fiscal year for which a local educational agency would receive a payment under subsection (b) in excess of the amount determined under paragraph (2), the payment received by the local educational agency for such fiscal year shall be calculated under paragraph (1) or (2) of subsection (b).

(4) Ratable reductions

(A) In general

If the sums made available under this subchapter for any fiscal year are insufficient to pay the full amounts that all local educational agencies in all States are eligible to receive under paragraph (1) for such year, then the Secretary shall ratably reduce the payments to all such agencies for such year.

(B) Additional funds

If additional funds become available for making payments under paragraph (1) for such fiscal year, payments that were reduced under subparagraph (A) shall be increased on the same basis as such payments were reduced.

(f) Other funds

Notwithstanding any other provision of law, a local educational agency receiving funds under this section may also receive funds under section 386 of the National Defense Authorization Act for Fiscal Year 1993 or such section’s successor authority.