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bears to the urbanized population of all States. In
this paragraph, the term ‘urbanized population’
means the population of an area consisting of a
central city or cities of at least 50,000 inhabitants
and the surrounding closely settled area for the city
or cities considered as an urbanized area by the Sec-
retary of Commerce for general statistical purposes.
‘‘(d) INCOME TAX AMOUNT
AND TAX EFFORT
AMOUNT.—(1) The income tax amount of a State for a
payment period is 15 percent of the net amount collected
during the calendar year ending before the beginning of
the payment period from the tax imposed on the income
of individuals by the State and described as a State in-
come tax under section 164(a)(3) of the Internal Revenue
Code of 1986 (26 U.S.C. 164(a)(3)). The income tax
amount for a payment period shall be at least 1 percent
but not more than 6 percent of the United States Govern-
ment individual income tax liability attributed to the State
for the taxable year ending during the last calendar year
ending before the beginning of the payment period. The
Secretary shall determine the Government income tax li-
ability attributed to the State on the same basis as the
Secretary of the Treasury determines that liability for gen-
eral statistical purposes.
186
‘‘(2) The general tax effort amount of a State for
a payment period is the amount determined by multiply-
ing—
‘‘(A) the net amount of State and local taxes of
the State collected during the years used by the Sec-
retary of Commerce in the most recent Bureau of
the Census general determination of State and local
taxes made before the beginning of the payment
period; by
‘‘(B) the general tax effort factor of the State
determined under subsection (b)(2).
‘‘(e) ALLOCATION FOR PUERTO RICO, GUAM, AMER-
ICAN SAMOA, AND THE VIRGIN ISLANDS.—(1)(A) For
each payment period for which funds are available for allo-
cation under this chapter, the Secretary shall allocate to
each territorial government an amount equal to the prod-
uct of 1 percent of the amount of funds available for allo-
cation multiplied by the applicable territorial percentage.
‘‘(B) For the purposes of this paragraph, the applica-
ble territorial percentage of a territory is equal to the
quotient resulting from the division of the territorial popu-
lation of such territory by the sum of the territorial popu-
lation for all territories.
‘‘(2) The governments of the territories shall make
payments to local governments within their jurisdiction
187
from sums received under this subsection as they consider
appropriate.
‘‘(3) For purposes of this subsection—
‘‘(A) the term ‘territorial government’
means the government of a territory;
‘‘(B) the term ‘territory’ means Puerto
Rico, Guam, American Samoa, and the Virgin
Islands; and
‘‘(C) the term ‘territorial population’
means the most recent population for each ter-
ritory as determined by the Bureau of Census.
‘‘§ 6705. Local government allocations
‘‘(a) INDIAN TRIBES AND ALASKAN NATIVES VIL-
LAGES.—If there is in a State an Indian tribe or Alaskan
native village having a recognized governing body carrying
out substantial governmental duties and powers, the Sec-
retary shall allocate to the tribe or village, out of the
amount allocated to the State under section 6704, an
amount bearing the same ratio to the amount allocated
to the State as the population of the tribe or village bears
to the population of the State. The Secretary shall allocate
amounts under this subsection to Indian tribes and Alas-
kan native villages in a State before allocating amounts
to units of general local government in the State under
subsection (b).
188
‘‘(b) OTHER LOCAL GOVERNMENT ALLOCATIONS.—
(1) The Secretary shall allocate among the units of general
local government in a State (other than units receiving
allocations under subsection (a)) the amount allocated to
the State under section 6704 (as that amount is reduced
by allocations under subsection (a)). Of the amount to be
allocated, the Secretary shall allocate a portion equal to
1⁄2 of such amount in accordance with section 6706(1),
and shall allocate a portion equal to 1⁄2 of such amount
in accordance with section 6706(2). A unit of general local
government shall receive an amount equal to the sum of
amounts allocated to the unit from each portion.
‘‘(2) From each portion to be allocated to units of
local government in a State under paragraph (1), the Sec-
retary shall allocate to a unit an amount bearing the same
ratio to the funds to be allocated as—
‘‘(A) the population of the unit, multiplied by
the general tax effort factor of the unit (determined
under paragraph (3)), multiplied by the income gap
of the unit (determined under paragraph (4)), bears
to
‘‘(B) the sum of the products determined under
subparagraph (A) for all units in the State for which
the income gap for that portion under paragraph (4)
is greater than zero.
189
‘‘(3)(A) Except as provided in subparagraph (C), the
general tax effort factor of a unit of general local govern-
ment for a payment period is—
‘‘(i) the adjusted taxes of the unit; divided by
‘‘(ii) the total income attributed to the unit.
‘‘(B) If the amount determined under subparagraphs
(A) (i) and (ii) for a unit of general local government is
less than zero, the general tax effort factor of the unit
is deemed to be zero.
‘‘(C)(i) Except as otherwise provided in this subpara-
graph, the adjusted taxes of a unit of general local govern-
ment are the taxes imposed by the unit for public purposes
(except employee and employer assessments and contribu-
tions to finance retirement and social insurance systems
and other special assessments for capital outlay), as deter-
mined by the Secretary of Commerce for general statistical
purposes and adjusted (under regulations of the Sec-
retary) to exclude amounts properly allocated to education
expenses.
‘‘(ii) The Secretary shall, for purposes of clause (i),
include that part of sales taxes transferred to a unit of
general local government that are imposed by a county
government in the geographic area of which is located the
unit of general local government as taxes imposed by the
unit for public purposes if—
190
‘‘(I) the county government transfers any part
of the revenue from the taxes to the unit of general
local government without specifying the purpose for
which the unit of general local government may ex-
pend the revenue; and
‘‘(II) the chief executive officer of the State no-
tifies the Secretary that the taxes satisfy the re-
quirements of this clause.
‘‘(iii) The adjusted taxes of a unit of general local
government shall not exceed the maximum allowable ad-
justed taxes for that unit.
‘‘(iv) The maximum allowable adjusted taxes for a
unit of general local government is the allowable adjusted
taxes of the unit minus the excess adjusted taxes of the
unit.
‘‘(v) The allowable adjusted taxes of a unit of general
government is the greater of—
‘‘(I) the amount equal to 2.5, multiplied by the
per capita adjusted taxes of all units of general local
government of the same type in the State, multiplied
by the population of the unit; or
‘‘(II) the amount equal to the population of the
unit, multiplied by the sum of the adjusted taxes of
all units of municipal local government in the State,
191
divided by the sum of the populations of all the units
of municipal local government in the State.
‘‘(vi) The excess adjusted taxes of a unit of general
local government is the amount equal to—
‘‘(I) the adjusted taxes of the unit, minus
‘‘(II) 1.5 multiplied by the allowable adjusted
taxes of the unit;
except that if this amount is less than zero then the excess
adjusted taxes of the unit is deemed to be zero.
‘‘(vii) For purposes of this subparagraph—
‘‘(I) the term ‘per capita adjusted taxes of all
units of general local government of the same type’
means the sum of the adjusted taxes of all units of
general local government of the same type divided by
the sum of the populations of all units of general
local government of the same type; and
‘‘(II) the term ‘units of general local govern-
ment of the same type’ means all townships if the
unit of general local government is a township, all
municipalities if the unit of general local government
is a municipality, all counties if the unit of general
local government is a county, or all unified city/
county governments if the unit of general local gov-
ernment is a unified city/county government.
192
‘‘(4)(A) Except as provided in subparagraph (B), the
income gap of a unit of general local government is—
‘‘(i) the number which applies under section
6706, multiplied by the per capita income of the
State in which the unit is located; minus
‘‘(ii) the per capita income of the geographic
area of the unit.
‘‘(B) If the amount determined under subparagraph
(A) for a unit of general local government is less than
zero, then the relative income factor of the unit is deemed
to be zero.
‘‘(c) SMALL GOVERNMENT ALLOCATIONS.—If the
Secretary decides that information available for a unit of
general local government with a population below a num-
ber (of not more than 500) prescribed by the Secretary
is inadequate, the Secretary may allocate to the unit, in
lieu of any allocation under subsection (b) for a payment
period, an amount bearing the same ratio to the total
amount to be allocated under subsection (b) for the period
for all units of general local government in the State as
the population of the unit bears to the population of all
units in the State.
193
‘‘§ 6706. Income gap multiplier
‘‘For purposes of determining the income gap of a
unit 
of 
general 
local 
government 
under 
section
6705(b)(4)(A), the number which applies is—
‘‘(1) 1.6, with respect to 1⁄2 of any amount allo-
cated under section 6704 to the State in which the
unit is located; and
‘‘(2) 1.2, with respect to the remainder of such
amount.
‘‘§ 6707. State variation of local government alloca-
tions
‘‘(a) STATE FORMULA.—A State government may
provide by law for the allocation of amounts among units
of general local government in the State on the basis of
population multiplied by the general tax effort factors or
income gaps of the units of general local government de-
termined under sections 6705 (a) and (b) or a combination
of those factors. A State government providing for a vari-
ation of an allocation formula provided under sections
6705 (a) and (b) shall notify the Secretary of the variation
by the 30th day before the beginning of the first payment
period in which the variation applies. A variation shall—
‘‘(1) provide for allocating the total amount al-
located under sections 6705 (a) and (b);
‘‘(2) apply uniformly in the State; and
194
‘‘(3) apply only to payment periods beginning
before October 1, 1995.
‘‘(b) CERTIFICATION.—A variation by a State govern-
ment under this section may apply only if the Secretary
certifies that the variation complies with this section. The
Secretary may certify a variation only if the Secretary is
notified of the variation at least 30 days before the first
payment period in which the variation applies.
‘‘§ 6708. Adjustments of local government allocations
‘‘(a) MAXIMUM AMOUNT.—The amount allocated to
a unit of general local government for a payment period
may not exceed the adjusted taxes imposed by the unit
of general local government as determined under section
6705(b)(3). Amounts in excess of adjusted taxes shall be
paid to the Governor of the State in which the unit of
local government is located.
‘‘(b) DE MINIMIS ALLOCATIONS.—If the amount al-
located to a unit of general local government (except an
Indian tribe or an Alaskan native village) for a payment
period would be less than $5,000 but for this subsection
or is waived by the governing authority of the unit of gen-
eral local government, the Secretary shall pay the amount
to the Governor of the State in which the unit is located.
‘‘(c) USE OF PAYMENTS TO STATES.—The Governor
of a State shall use all amounts paid to the Governor
382
substance abuse treatment programs. Such testing shall
include individuals released from residential substance
abuse treatment programs who remain in the custody of
the State.
‘‘(c) ELIGIBILITY FOR PREFERENCE WITH AFTER
CARE COMPONENT.—
‘‘(1) To be eligible for a preference under this
part, a State must ensure that individuals who par-
ticipate in the substance abuse treatment program
established or implemented with assistance provided
under this part will be provided with aftercare serv-
ices.
‘‘(2) State aftercare services must involve the
coordination of the correctional facility treatment
program with other human service and rehabilitation
programs, such as educational and job training pro-
grams, parole supervision programs, half-way house
programs, and participation in self-help and peer
group programs, that may aid in the rehabilitation
of individuals in the substance abuse treatment pro-
gram.
‘‘(3) To qualify as an aftercare program, the
head of the substance abuse treatment program, in
conjunction with State and local authorities and or-
ganizations involved in substance abuse treatment,