To require grants to State and local governments for infrastructure and social services needs in the same amount as the amount of relief and reconstruction funds provided to Iraq.

Summary: American Parity Act of 2005 - Directs the Secretary of the Treasury to make grants to states and local governments for assistance in making priority expenditures. Defines priority expenditures as ordinary and necessary maintenance and operating expenses for: (1) primary, secondary, or higher education; (2) public safety; (3) public health; (4) social services for the disadvantaged or aged; (5) roads, transportation, and water infrastructure; and (6) housing, as well as ordinary and necessary capital expenditures authorized by state law. Requires at least one third of grant amounts to be made available to local governments.

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``American Parity Act of 2005''.

SEC. 2. FINDINGS.

     The Congress finds the following:
            (1) The Administration has requested and received funds for 
        an ongoing multibillion dollar reconstruction for the Republic 
        of Iraq.
            (2) In fiscal year 2003 and fiscal year 2004, approximately 
        $21 billion was appropriated to the Iraq Relief and 
        Reconstruction Fund (``IRRF''), of which $16.6 billion had been 
        obligated and $9.5 billion had been spent by late July 2005.
            (3) The total projected cost of reconstruction through 2007 
        as estimated by the World Bank, the United Nations Development 
        Group, and the Coalition Provisional Authority (``CPA''), is 
        $55 billion.
            (4) The President has requested some funding for fiscal 
        year 2006 to be appropriated to traditional foreign aid 
        accounts rather than through the IRRF as in the past, making 
        the total cost of reconstruction less predictable.
            (5) To date, the IRRF has allocated resources in Iraq--
                    (A) with respect to education--
                            (i) to rehabilitate 2,717 schools;
                            (ii) to train 32,700 secondary school 
                        teachers and administrators;
                            (iii) to distribute hundreds of thousands 
                        of desks, chairs, cabinets, chalkboards, and 
                        kits for primary and secondary schools;
                            (iv) to install satellite internet access 
                        and computers at the Ministry of Education and 
                        all 21 Directorates of Education; and
                            (v) to edit, print, and distribute more 
                        than 8.7 million math and science text books;
                    (B) with respect to medical science--
                            (i) to provide potable water for 400,000 
                        people each day in Basra city and 170,000 in 
                        Kirkuk and Mosul;
                            (ii) to vaccinate over 3,000,000 children 
                        under the age of five and 700,000 pregnant 
                        women;
                            (iii) to provide supplementary doses of 
                        vitamin A for more than 600,000 children under 
                        two years old;
                            (iv) to renovate 110 primary health care 
                        centers; and
                            (v) to train 2,000 health educators, 
                        teachers, religious leaders, and youth to 
                        mobilize communities on hygiene, diarrhea, 
                        breast-feeding, nutrition, and immunization 
                        issues; and
                    (C) with respect to technology and infrastructure--
                            (i) to complete 3 major bridges and 36 
                        detailed bridge assessments;
                            (ii) to construct 72 kilometers of new 
                        railroad track and facilities between the Port 
                        of Umm Qasr and Shuaiba Junction;
                            (iii) to rehabilitate parts of the Sweet 
                        Water Canal system, including repairing 
                        breaches and cleaning the main reservoir;
                            (iv) to refurbish 14 water treatment plants 
                        around Basra serving 1.75 million people; and
                            (v) to conduct marshland restoration 
                        activities.
            (6) The President's budget has eliminated or reduced 
        domestic spending in many areas where resources have been 
        allocated in Iraq, including--
                    (A) eliminating 48 education programs totaling $4.3 
                billion;
                    (B) reducing spending on student loans by $10.7 
                billion over 10 years;
                    (C) cutting Medicaid by $60 billion;
                    (D) reducing health professions training from $300 
                million to $89 million;
                    (E) cutting funding for Amtrak by $847 million or 
                70.2 percent;
                    (F) decreasing funding for the Clean Water State 
                Revolving Fund by $361 million;
                    (G) suspending or canceling 31 Army Corps of 
                Engineers projects previously requested by the 
                President and funded by Congress;
                    (H) cutting funding for the Environmental 
                Protection Agency by $452 million;
                    (I) reducing the budget for First Responders by 
                $1.6 billion; and
                    (J) eliminating the Community Development Block 
                Grant program, a funding cut of $4.6 billion.
            (7) State and local governments in the United States have 
        their own unmet infrastructure and social services needs.
            (8) State and local Governments are experiencing financial 
        difficulties at a time when a greater funding burden is being 
        shifted to them.
            (9) State and local Governments deserve, at a minimum, the 
        same level of Federal investment to address infrastructure and 
        social services shortfalls as the amount of relief and 
        reconstruction funds provided to Iraq.

SEC. 3. FORMULA GRANTS TO STATES AND LOCAL GOVERNMENTS.

    (a) Purpose.--The Secretary of the Treasury (referred to in this 
section as the ``Secretary'') shall in accordance with this section 
make grants to States and local governments for the purpose of 
assisting grantees in making priority expenditures.
    (b) Priority Expenditures.--For purposes of this section, the term 
``priority expenditures'' means only--
            (1) ordinary and necessary maintenance and operating 
        expenses for--
                    (A) primary, secondary, or higher education, 
                including school building renovation;
                    (B) public safety;
                    (C) public health, including hospitals and public 
                health laboratories;
                    (D) social services for the disadvantaged or aged;
                    (E) roads, transportation, and water 
                infrastructure; and
                    (F) housing; and
            (2) ordinary and necessary capital expenditures authorized 
        by state law.
    (c) Allocation of Grants.--
            (1) In general.--Not later than 30 days after the date of 
        the enactment of this Act, the Secretary shall establish a 
        formula for determining the allocation of grants under 
        subsection (a). The formula shall give priority weight to the 
        following factors:
                    (A) The unemployment rate in relation to the 
                national average unemployment rate.
                    (B) The duration of the unemployment rate above 
                such average.
                    (C) The median income.
                    (D) The population.
                    (E) The poverty rate.
            (2) Local governments.--In making grants under subsection 
        (a), the Secretary shall ensure that not less than one-third of 
        the amount appropriated under subsection (f) is made available 
        to local governments under the applicable laws of a given 
        State.
    (d) Application for Grant.--A grant may be made under subsection 
(a) only if an applicant for the grant is submitted to the Secretary 
and the application is in such form, is made in such manner, and 
contains such agreements, assurances, and information as the Secretary 
determines to be necessary to carry out this section.
    (e) Authorization of Appropriation.--For the purpose of making 
grants under subsection (a), there is authorized to be appropriated to 
the Secretary for fiscal year 2007 an amount equal to at least the 
total amount appropriated for fiscal year 2006 in supplemental 
appropriation Acts, and other appropriation Acts, for the 
reconstruction of Iraq. Amounts appropriated under the preceding 
sentence shall be in addition to, and not in lieu of, other amounts 
appropriated for payments to States and local governments.