I
106TH CONGRESS
2D SESSION
H. R. 3616
To reauthorize the impact aid program under the Elementary and Secondary
Education Act of 1965, and for other purposes.
IN THE HOUSE OF REPRESENTATIVES
FEBRUARY 10, 2000
Mr. HAYES (for himself, Mr. GOODLING, Mr. GREENWOOD, Mr. SCOTT, Mr.
EDWARDS, 
Mr. 
POMEROY, 
Mr. 
HAYWORTH, 
Mr. 
KILDEE, 
Mr.
CUNNINGHAM, Mr. THORNBERRY, Mr. MCHUGH, Mr. BILBRAY, Mr.
MCCRERY, 
Mrs. 
KELLY, 
Mr. 
JONES
of 
North 
Carolina, 
Mr.
KUYKENDALL, Mr. HEFLEY, Mr. YOUNG of Alaska, Mr. CHAMBLISS, Mr.
MCKEON, Mr. FLETCHER, Mr. GIBBONS, Mr. NETHERCUTT, Mrs.
CUBIN, Mr. KENNEDY of Rhode Island, Mr. SKELTON, Mr. MCINTYRE,
Mr. SAXTON, Mr. CALVERT, Mr. WHITFIELD, Mr. PORTER, Mr. PACK-
ARD, Mrs. BONO, Mr. ROHRABACHER, Mr. TERRY, Mr. TANCREDO, and
Mr. STUMP) introduced the following bill; which was referred to the Com-
mittee on Education and the Workforce
A BILL
To reauthorize the impact aid program under the Elementary
and Secondary Education Act of 1965, and for other
purposes.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ‘‘Impact Aid Reauthor-
ization Act of 2000’’.
SEC. 2. PURPOSE.
Section 8001 of the Elementary and Secondary Edu-
cation Act of 1965 (20 U.S.C. 7701) is amended—
(1) in the matter preceding paragraph (1)—
(A) by inserting after ‘‘educational services
to federally connected children’’ the following:
‘‘in a manner that promotes control by local
educational agencies with little or no Federal or
State involvement’’; and
(B) by inserting after ‘‘certain activities of
the Federal Government’’ the following: ‘‘, such
as activities to fulfill the responsibilities of the
Federal Government with respect to Indian
tribes and activities under section 514 of the
Soldiers’ and Sailors’ Civil Relief Act of 1940
(50 U.S.C. App. 574),’’;
(2) in paragraph (4), by adding ‘‘or’’ at the
end;
(3) by striking paragraph (5);
(4) by redesignating paragraph (6) as para-
graph (5); and
(5) in paragraph (5) (as redesignated), by in-
serting before the period at the end the following:
‘‘and because of the difficulty of raising local rev-
enue through bond referendums for capital projects
due to the inability to tax Federal property’’.
SEC. 3. PAYMENTS RELATING TO FEDERAL ACQUISITION
OF REAL PROPERTY.
(a) FISCAL YEAR REQUIREMENT.—Section 8002(a)
of the Elementary and Secondary Education Act of 1965
(20 U.S.C. 7702(a)) is amended in the matter preceding
paragraph (1) by striking ‘‘1999’’ and inserting ‘‘2005’’.
(b) AMOUNT.—
(1) 
INSUFFICIENT
FUNDS.—Section
8002(b)(1)(B) of the Elementary and Secondary
Education Act of 1965 (20 U.S.C. 7702(b)(1)(B)) is
amended by striking ‘‘shall ratably reduce the pay-
ment to each eligible local educational agency’’ and
inserting ‘‘shall calculate the payment for each eligi-
ble local educational agency in accordance with sub-
section (h)’’.
(2) MAXIMUM AMOUNT.—Section 8002(b)(1)(C)
of the Elementary and Secondary Education Act of
1965 (20 U.S.C. 7702(b)(1)(C)) is amended by add-
ing at the end before the period the following: ‘‘, or
the maximum amount that such agency is eligible to
receive for such fiscal year under this section, which-
ever is greater’’.
(c) PAYMENTS WITH RESPECT TO FISCAL YEARS IN
WHICH INSUFFICIENT FUNDS ARE APPROPRIATED.—
Section 8002(h) of the Elementary and Secondary Edu-
cation Act of 1965 (20 U.S.C. 7702(h)) is amended to
read as follows:
‘‘(h) PAYMENTS WITH RESPECT TO FISCAL YEARS
IN WHICH INSUFFICIENT FUNDS ARE APPROPRIATED.—
For any fiscal year for which the amount appropriated
under section 8014(a) is insufficient to pay to each local
educational agency the full amount determined under sub-
section (b), the Secretary shall make payments to each
local educational agency under this section as follows:
‘‘(1) FOUNDATION PAYMENTS FOR PRE-1995 RE-
CIPIENTS.—
‘‘(A) IN
GENERAL.—The Secretary shall
first make a foundation payment to each local
educational agency that is eligible to receive a
payment under this section for the fiscal year
involved and was eligible to receive a payment
under section 2 of the Act of September 30,
1950 (Public Law 874, 81st Congress) (as such
section was in effect on the day preceding the
date of the enactment of the Improving Amer-
ica’s Schools Act of 1994) for any of the fiscal
years 1989 through 1994.
‘‘(B) AMOUNT.—The amount of a payment
under subparagraph (A) for a local educational
agency shall be equal to 37 percent of the pay-
ment amount the local educational agency was
eligible to receive under section 2 of the Act of
September 30, 1950, for fiscal year 1994 (or if
the local educational agency was not eligible to
receive a payment under such section 2 for fis-
cal year 1994, the payment that local edu-
cational agency was eligible to receive under
such section 2 for the most recent fiscal year
preceding 1994).
‘‘(C) INSUFFICIENT APPROPRIATIONS.—If
the amount appropriated under section 8014(a)
is insufficient to pay the full amount deter-
mined under this paragraph for all eligible local
educational agencies for the fiscal year, then
the Secretary shall ratably reduce the payment
to each local educational agency under this
paragraph.
‘‘(2) PAYMENTS FOR 1995 RECIPIENTS.—
‘‘(A) IN
GENERAL.—From any amounts
remaining after making payments under para-
graph (1) for the fiscal year involved, the Sec-
retary shall make a payment to each eligible
local educational agency that received a pay-
ment under this section for fiscal year 1995.
‘‘(B) AMOUNT.—The amount of a payment
under subparagraph (A) for a local educational
agency shall be determined as follows:
‘‘(i) Calculate the difference between
the amount appropriated to carry out this
section for fiscal year 1995 and the total
amount of foundation payments made
under paragraph (1) for the fiscal year.
‘‘(ii) Determine the percentage share
for each local educational agency that re-
ceived a payment under this section for fis-
cal year 1995 by dividing the assessed
value of the Federal property of the local
educational agency for fiscal year 1995 de-
termined in accordance with subsection
(b)(3), by the total national assessed value
of the Federal property of all such local
educational agencies for fiscal year 1995,
as so determined.
‘‘(iii) Multiply the percentage share
described in clause (ii) for the local edu-
cational agency by the amount determined
under clause (i).
‘‘(3) SUBSECTION (i) RECIPIENTS.—From any
funds remaining after making payments under para-
graphs (1) and (2) for the fiscal year involved, the
Secretary shall make payments in accordance with
subsection (i).
‘‘(4) REMAINING FUNDS.—From any funds re-
maining after making payments under paragraphs
(1), (2), and (3) for the fiscal year involved—
‘‘(A) the Secretary shall make a payment
to each local educational agency that received a
foundation payment under paragraph (1) for
the fiscal year involved in an amount that bears
the same relation to 25 percent of the remain-
der as the amount the local educational agency
received under paragraph (1) for the fiscal year
involved bears to the amount all local edu-
cational agencies received under paragraph (1)
for the fiscal year involved; and
‘‘(B) the Secretary shall make a payment
to each local educational agency that is eligible
to receive a payment under this section for the
fiscal year involved in an amount that bears the
same relation to 75 percent of the remainder as
a percentage share determined for the local
educational agency (in the same manner as per-
centage shares are determined for local edu-
cational agencies under paragraph (2)(B)(ii))
bears to the percentage share determined (in
the same manner) for all local educational
agencies eligible to receive a payment under this
section for the fiscal year involved, except that
for the purpose of calculating a local edu-
cational agency’s assessed value of the Federal
property, data from the most current fiscal year
shall be used.’’.
(d) SPECIAL PAYMENTS.—
(1) IN GENERAL.—Section 8002(i)(1) of the El-
ementary and Secondary Education Act of 1965 (20
U.S.C. 7702(i)(1)) is amended to read as follows:
‘‘(1) IN GENERAL.—For any fiscal year begin-
ning with fiscal year 2000 for which the amount ap-
propriated to carry out this section exceeds the
amount so appropriated for fiscal year 1996 and for
which subsection (b)(1)(B) applies, the Secretary
shall use the remainder described in subsection
(h)(3) for the fiscal year involved (not to exceed the
amount equal to the difference between (A) the
amount appropriated to carry out this section for
fiscal year 1997 and (B) the amount appropriated to
carry out this section for fiscal year 1996) to in-
crease the payment that would otherwise be made
under this section to not more than 50 percent of
the maximum amount determined under subsection
(b) for any local educational agency described in
paragraph (2).’’.
(2) CONFORMING AMENDMENT.—The heading
of section 8002(i) of the Elementary and Secondary
Education Act of 1965 (20 U.S.C. 7702(i)) is
amended by striking ‘‘PRIORITY’’ and inserting SPE-
CIAL’’.
(e) ADDITIONAL ASSISTANCE FOR CERTAIN LOCAL
EDUCATIONAL AGENCIES IMPACTED BY FEDERAL PROP-
ERTY ACQUISITION.—Section 8002(j)(2) of the Elemen-
tary and Secondary Education Act of 1965 (20 U.S.C.
7702(j)(2)) is amended—
(1) by striking ‘‘(A) A local educational agen-
cy’’ and inserting ‘‘A local educational agency’’;
(2) by redesignating clauses (i) through (v) as
subparagraphs (A) through (E), respectively; and
(3) in subparagraph (C) (as redesignated), by
adding at the end before the period the following:
‘‘and such agency does not currently have a military
installation located within its geographic bound-
aries’’.
(f) DATA; PRELIMINARY AND FINAL PAYMENTS.—
Section 8002 of the Elementary and Secondary Education
Act of 1965 (20 U.S.C. 7702) is amended by adding at
the end the following:
‘‘(l) DATA; PRELIMINARY AND FINAL PAYMENTS.—
‘‘(1) IN GENERAL.—The Secretary shall—
‘‘(A) not later than 30 days following the
application deadline under section 8005(c) for a
fiscal year, require any local educational agency
that applied for a payment under subsection (b)
for the fiscal year to submit such data as may
be necessary in order to compute the payment;
‘‘(B) as soon as possible after the begin-
ning of any fiscal year, but no later than 60
days after the enactment of an Act making ap-
propriations to carry out this title for the fiscal
year, provide a preliminary payment under sub-
section (b) for any local educational agency that
applied for a payment under subsection (b) for
the fiscal year and was eligible for such a pay-
ment for the preceding fiscal year, in the
amount of 60 percent of the payment for the
previous year; and
‘‘(C) provide a final payment under sub-
section (b) for any eligible local educational
agency not later than 12 months after the ap-
plication deadline established under section
8005(c), except that any local educational agen-
cy failing to submit all of the data required
under subparagraph (A) shall be denied such
payment for the fiscal year for which the appli-
cation is made unless funds from a source other
than the Act described in subparagraph (B) are
made available to provide such payment.
‘‘(2) ELIGIBILITY
FOR
PAYMENTS
IN
SUBSE-
QUENT YEARS.—The denial of a payment under sub-
section (b) to a local educational agency for a fiscal
year pursuant to this subsection shall not affect the
eligibility of the local educational agency for a final
payment under subsection (b) for a subsequent fiscal
year.’’.
SEC. 4. PAYMENTS FOR ELIGIBLE FEDERALLY CONNECTED
CHILDREN.
(a) MILITARY INSTALLATION HOUSING UNDERGOING
RENOVATION OR REBUILDING.—
(1) IN GENERAL.—Section 8003(a)(4) of the
Elementary and Secondary Education Act of 1965
(20 U.S.C. 7703(a)) is amended—
(A) in the heading, by striking ‘‘UNDER-
GOING
RENOVATION’’ and inserting ‘‘UNDER-
GOING RENOVATION OR REBUILDING’’;
(B) by striking ‘‘For purposes’’ and insert-
ing the following:
‘‘(A) IN GENERAL.—For purposes’’;
(C) in subparagraph (A) (as designated by
subparagraph (B)), by inserting ‘‘or rebuilding’’
after ‘‘undergoing renovation’’; and
(D) by adding at the end the following:
‘‘(B) LIMITATIONS.—(i)(I) Except as pro-
vided in subclause (II), children described in
paragraph (1)(D)(i) may be deemed to be chil-
dren described in paragraph (1)(B) with respect
to housing on Federal property undergoing ren-
ovation or rebuilding in accordance with sub-
paragraph (A) for a period not to exceed 2 fis-
cal years.
‘‘(II) If the Secretary determines, on the
basis of a certification provided to the Secretary
by a designated representative of the Secretary
of Defense, that the expected completion date of
the renovation or rebuilding of the housing has
been delayed by not less than 1 year, then—
‘‘(aa) in the case of a determination
made by the Secretary in the 1st fiscal
year described in subclause (I), the time
period described such subclause shall be
extended by the Secretary for an additional
2 years; and
‘‘(bb) in the case of a determination
made by the Secretary in the 2nd fiscal
year described in subclause (I), the time
period described such subclause shall be
extended by the Secretary for an additional
1 year.
‘‘(ii) The number of children described in
paragraph (1)(D)(i) who are deemed to be chil-
dren described in paragraph (1)(B) with respect
to housing on Federal property undergoing ren-
ovation or rebuilding in accordance with sub-
paragraph (A) for any fiscal year may not ex-
ceed the maximum number of children who are
expected to occupy that housing upon comple-
tion of the renovation or rebuilding.’’.
(2) EFFECTIVE DATE.—The amendments made
by paragraph (1) shall apply with respect to pay-
ments to a local educational agency for fiscal years
beginning before, on, or after the date of the enact-
ment of this Act.
(b) MILITARY ‘‘BUILD TO LEASE’’ PROGRAM HOUS-
ING.—Section 8003(a) of the Elementary and Secondary
Education Act of 1965 (20 U.S.C. 7703(a)) is amended
by adding at the end the following:
‘‘(5) MILITARY ‘BUILD
TO
LEASE’ PROGRAM
HOUSING.—
‘‘(A) IN GENERAL.—For purposes of com-
puting the amount of payment for a local edu-
cational agency for children identified under
paragraph (1), the Secretary shall consider chil-
dren residing in housing initially acquired or
constructed under the former section 2828(g) of
title 10, United States Code (commonly known
as the ‘Build to Lease’ program), as added by
section 801 of the Military Construction Au-
thorization Act, 1984, to be children described
under paragraph (1)(B) if the property de-
scribed is within the fenced security perimeter
of the military facility 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 re-
ceive a payment under this section, then the
Secretary—
‘‘(i) shall require the local educational
agency to provide certification from an ap-
propriate official of the Department of De-
fense 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 agen-
cy, 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.’’.
SEC. 5. BASIC SUPPORT PAYMENTS FOR HEAVILY IM-
PACTED LOCAL EDUCATIONAL AGENCIES.
(a) IN GENERAL.—Section 8003(b) of the Elemen-
tary and Secondary Education Act of 1965 (20 U.S.C.
7703(b)) is amended—
(1) by redesignating paragraphs (2) and (3) as
paragraphs (3) and (4), respectively; and
(2) by inserting after paragraph (1) the fol-
lowing:
‘‘(2) BASIC SUPPORT PAYMENTS FOR HEAVILY
IMPACTED LOCAL EDUCATIONAL AGENCIES.—
‘‘(A) IN GENERAL.—(i) From the amount
appropriated under section 8014(b) for a fiscal
year, the Secretary is authorized to make basic
support payments to eligible heavily impacted
local educational agencies with children de-
scribed in subsection (a).
‘‘(ii) A local educational agency that re-
ceives a basic support payment under this para-
graph for a fiscal year shall not be eligible to
receive a basic support payment under para-
graph (1) for that fiscal year.
‘‘(B) ELIGIBILITY FOR CONTINUING HEAV-
ILY
IMPACTED
LOCAL
EDUCATIONAL
AGEN-
CIES.—
‘‘(i) FISCAL
YEAR
2001.—A heavily
impacted local educational agency is eligi-
ble to receive a basic support payment
under subparagraph (A) for fiscal year
2001 with respect to a number of children
determined under subsection (a)(1) only if
the agency received an additional assist-
ance payment under subsection (f) (as
such subsection was in effect on the day
before the date of the enactment of the
Impact Aid Reauthorization Act of 2000)
for fiscal year 2000.
‘‘(ii) FISCAL YEAR 2002 AND SUBSE-
QUENT
FISCAL
YEARS.—A heavily im-
pacted local educational agency described
in clause (i) is eligible to receive a basic
support payment under subparagraph (A)
for fiscal year 2002 and any subsequent
fiscal year with respect to a number of
children 
determined 
under 
subsection
(a)(1) only if the agency—
‘‘(I) received a basic support pay-
ment under subparagraph (A) for fis-
cal year 2001; and
‘‘(II)(aa) is a local educational
agency whose boundaries are the same
as a Federal military installation;
‘‘(bb) has an enrollment of feder-
ally connected children described in
subsection (a)(1) which constitutes a
percentage of the total student enroll-
ment of such agency which is not less
than 35 percent, has a per-pupil ex-
penditure that is less than the average
per-pupil expenditure of the State in
which the agency is located or the av-
erage per-pupil expenditure of all
States (whichever average per-pupil
expenditure is greater), except that a
local educational agency with a total
student enrollment of less than 350
students shall be deemed to have sat-
isfied such per-pupil expenditure re-
quirement, and has a tax rate for gen-
eral fund purposes which is at least
95 percent of the average tax rate for
general fund purposes of comparable
local educational agencies in the
State; or
‘‘(cc) has a total student enroll-
ment of not less than 25,000 stu-
dents, of which not less than 50 per-
cent are federally connected children
described in subsection (a)(1) and not
less than 6,000 of such federally con-
nected children are children described
in subparagraphs (A) and (B) of sub-
section (a)(1).
‘‘(iii) RESUMPTION OF ELIGIBILITY.—
A heavily impacted local educational agen-
cy described in clause (i) or (ii) that be-
comes ineligible under either such clause
for 1 or more fiscal years may resume eli-
gibility for a basic support payment under
this paragraph for a subsequent fiscal year
only if the agency meets the requirements
of item (aa), (bb), or (cc) of clause (ii)(II)
for that subsequent fiscal year.
‘‘(C) ELIGIBILITY FOR NEW HEAVILY IM-
PACTED LOCAL EDUCATIONAL AGENCIES.—
‘‘(i) IN
GENERAL.—A heavily im-
pacted local educational agency that did
not receive an additional assistance pay-
ment under subsection (f) (as such sub-
section was in effect on the day before the
date of the enactment of the Impact Aid
Reauthorization Act of 2000) for fiscal
year 2000 is eligible to receive a basic sup-
port payment under subparagraph (A) for
fiscal year 2002 and any subsequent fiscal
year with respect to a number of children
determined under subsection (a)(1) only if
the agency—
‘‘(I) has an enrollment of feder-
ally connected children described in
subsection (a)(1) which constitutes a
percentage of the total student enroll-
ment of such agency which (aa) is not
less than 50 percent if such agency
receives a payment on behalf of chil-
dren described in subparagraphs (F)
and (G) of such subsection or (bb) is
not less than 40 percent if such agen-
cy does not receive a payment on be-
half of such children;
‘‘(II)(aa) is a local educational
agency whose boundaries are the same
as a Federal military installation; or
‘‘(bb) is a local educational agen-
cy that has a tax rate for general
fund purposes which is at least 95
percent of the average tax rate for
general fund purposes of comparable
local educational agencies in the
State; and
‘‘(III)(aa) for a local educational
agency that has a total student enroll-
ment of 350 or more students, the
agency has a per-pupil expenditure
that is less than the average per-pupil
expenditure of the State in which the
agency is located; or
‘‘(bb) for a local educational
agency that has a total student enroll-
ment of less than 350 students, the
agency has a per-pupil expenditure
that is less than the average per-pupil
expenditure of a comparable agency in
the State in which the agency is lo-
cated.
‘‘(ii) RESUMPTION OF ELIGIBILITY.—
A heavily impacted local educational agen-
cy described in clause (i) that becomes in-
eligible under such clause for 1 or more
fiscal years may resume eligibility for a
basic support payment under this para-
graph for a subsequent fiscal year only if
the agency meets the requirements of sub-
clauses (I), (II), and (III) of clause (i) for
that subsequent fiscal year.
‘‘(iii) APPLICATION.—With respect to
the first fiscal year for which a heavily im-
pacted local educational agency described
in clause (i) applies for a basic support
payment under subparagraph (A), or with
respect to the first fiscal year for which a
heavily impacted local educational agency
applies for a basic support payment under
subparagraph (A) after becoming ineligible
under clause (i) for 1 or more preceding
fiscal years, the agency shall apply for
such payment at least 1 year prior to the
start of that first fiscal year.
‘‘(D) MAXIMUM
AMOUNT
FOR
REGULAR
HEAVILY
IMPACTED
LOCAL
EDUCATIONAL
AGENCIES.—(i) Except as provided in subpara-
graph (E), 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) (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)(I) For a local educational agency with
respect to 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), the Secretary shall calculate the weight-
ed student units of such children for purposes
of subsection (a)(2) by multiplying the number
of such children by a factor of 0.55.
‘‘(II) For a local educational agency that
has an enrollment of 100 or fewer federally con-
nected children described in subsection (a)(1),
the Secretary shall calculate the total number
of weighted student units for purposes of sub-
section (a)(2) by multiplying the number of
such children by a factor of 1.75.
‘‘(III) For a local educational agency that
has an enrollment of more than 100 but not
more than 750 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.
‘‘(E) MAXIMUM
AMOUNT
FOR
LARGE
HEAVILY
IMPACTED
LOCAL
EDUCATIONAL
AGENCIES.—(i)(I) Subject to clause (ii), 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 accord-
ance with the formula described in paragraph
(1)(C).
‘‘(II) A heavily impacted local educational
agency described in this subclause is a local
educational agency that has a total student en-
rollment of not less than 25,000 students, of
which not less than 50 percent are federally
connected children described in subsection
(a)(1) and not less than 6,000 of such federally
connected children are children described in
subparagraphs (A) and (B) of subsection
(a)(1).
‘‘(ii) For purposes of calculating the max-
imum 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 sub-
section (a)(1) shall be 1.35.
‘‘(F) 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 agen-
cy is applying for assistance under this para-
graph.’’.
(b) PAYMENTS WITH RESPECT TO FISCAL YEARS IN
WHICH INSUFFICIENT FUNDS ARE APPROPRIATED.—
Paragraph (3) of section 8003(b) of the Elementary and
Secondary Education Act of 1965 (20 U.S.C. 7703(b)),
as redesignated, is amended—
(1) in subparagraph (A), by striking ‘‘para-
graph (1)’’ and inserting ‘‘paragraphs (1) and (2)’’;
(2) in subparagraph (B)—
(A) in the heading, by inserting after
‘‘PAYMENTS’’ the following: ‘‘IN LIEU OF PAY-
MENTS UNDER PARAGRAPH (1)’’;
(B) in the matter preceding subclause (I)
of clause (i), by inserting after ‘‘‘threshold pay-
ment’)’’ the following: ‘‘in lieu of basic support
payments under paragraph (1)’’;
(C) in clause (ii), by striking ‘‘paragraph
(1)’’ and inserting ‘‘clause (i)’’; and
(D) by adding at the end the following:
‘‘(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, the total percentage used to
calculate threshold payments under clause (i)
shall not be less than 40 percent.’’;
(3) by redesignating subparagraph (C) as sub-
paragraph (D);
(4) by inserting after subparagraph (B) the fol-
lowing:
‘‘(C) LEARNING
OPPORTUNITY
THRESH-
OLD 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 pay-
ments under paragraph (2) shall be equal to the
amount obtained under subparagraph (D) or
(E) of paragraph (2), as the case may be.’’; and
(5) in subparagraph (D) (as redesignated), by
striking ‘‘computation made under subparagraph
(B)’’ and inserting ‘‘computations made under sub-
paragraphs (B) and (C)’’.
(c) 
CONFORMING
AMENDMENTS.—(1) 
Section
8002(b)(1)(C) of the Elementary and Secondary Edu-
cation Act of 1965 (20 U.S.C. 7702(b)(1)(C)) is amended
by striking ‘‘section 8003(b)(1)(C)’’ and inserting ‘‘para-
graph 1(C) of section 8003(b) or subparagraph (D) or (E)
of paragraph (2) of such section, as the case may be’’.
(2) Section 8003 of the Elementary and Secondary
Education Act of 1965 (20 U.S.C. 7703) is amended—
(A) in subsection (a)(1), by striking ‘‘subsection
(b), (d), or (f)’’ and inserting ‘‘subsection (b) or
(d)’’;
(B) in subsection (b)—
(i) in paragraph (1)(C), in the matter pre-
ceding clause (i), by striking ‘‘this subsection’’
and inserting ‘‘this paragraph’’; and
(ii) in paragraph (4) (as redesignated)—
(I) in subparagraph (A), by striking
‘‘paragraphs (1)(B), (1)(C), and (2) of this
subsection’’ and inserting ‘‘subparagraphs
(B) and (C) of paragraph (1) or subpara-
graphs (B) through (D) of paragraph (2),
as the case may be, paragraph (3) of this
subsection’’; and
(II) in subparagraph (B)—
(aa) by inserting after ‘‘para-
graph (1)(C)’’ the following: ‘‘or sub-
paragraph (D) or (E) of paragraph
(2), as the case may be,’’; and
(bb) 
by 
striking 
‘‘paragraph
(2)(B)’’ and inserting ‘‘subparagraph
(B) or (C) of paragraph (3)’’;
(C) in subsection (c)(1), by striking ‘‘paragraph
(2) and subsection (f)’’ and inserting ‘‘subsection
(b)(2) and paragraph (2)’’;
(D) by striking subsection (f); and
(E) in subsection (i), by striking ‘‘sections 8002
and 8003(b)’’ and inserting ‘‘section 8002 and sub-
section (b) of this section’’.
SEC. 6. BASIC SUPPORT PAYMENTS FOR LOCAL EDU-
CATIONAL 
AGENCIES 
AFFECTED 
BY 
RE-
MOVAL OF FEDERAL PROPERTY.
Section 8003(b) of the Elementary and Secondary
Education Act of 1965 (20 U.S.C. 7703(b)), as amended
by this Act, is further amended by adding at the end the
following:
‘‘(5) LOCAL
EDUCATIONAL
AGENCIES
AF-
FECTED 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 edu-
cational agency described in subparagraph (B),
the Secretary shall meet the additional require-
ments described in subparagraph (C).
‘‘(B) LOCAL
EDUCATIONAL
AGENCY
DE-
SCRIBED.—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 1 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 the date of the enactment
of the Impact Aid Reauthorization Act of 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 sub-
paragraph are the following:
‘‘(i) For each fiscal year beginning
after the date on which the Federal prop-
erty is transferred, a child described in
subparagraph (B) who continues to reside
on such property and who continues to re-
ceive a free public education at a school of
the agency shall be deemed to be a child
who resides on Federal property for pur-
poses of computing under the applicable
subparagraph of subsection (a)(1) the
amount that the agency is eligible to re-
ceive under this subsection.
‘‘(ii)(I) For the third fiscal year be-
ginning after the date on which the Fed-
eral property is transferred, and for each
fiscal year thereafter, the Secretary shall,
after computing the amount that the agen-
cy is otherwise eligible to receive under this
subsection for the fiscal year involved, de-
duct 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 ac-
cordance with subclause (I), the local edu-
cational agency—
‘‘(aa) shall provide for a review
and certification of such amount by
an appropriate local tax authority;
and
‘‘(bb) shall submit to the Sec-
retary a report containing the amount
certified under item (aa).’’.
SEC. 7. ADDITIONAL PAYMENTS FOR LOCAL EDUCATIONAL
AGENCIES WITH HIGH CONCENTRATIONS OF
CHILDREN WITH SEVERE DISABILITIES.
(a) REPEAL.—Subsection (g) of section 8003 of the
Elementary and Secondary Education Act of 1965 (20
U.S.C. 7703(g)) is repealed.
(b) CONFORMING AMENDMENTS.—(1) Section 8003
of the Elementary and Secondary Education Act of 1965
(20 U.S.C. 7703) is amended by redesignating subsections
(h) and (i) as subsections (f) and (g), respectively.
(2) Section 426 of the General Education Provisions
Act (20 U.S.C. 1228) is amended by striking ‘‘subsections
(d) and (g) of section 8003 of such Act’’ and inserting
‘‘section 8003(d) of such Act’’.
SEC. 8. APPLICATION FOR PAYMENTS UNDER SECTIONS
8002 AND 8003.
Section 8005(d) of the Elementary and Secondary
Education Act of 1965 (20 U.S.C. 7705(d)) is amended—
(1) in paragraph (2), by inserting after ‘‘not
more than 60 days after a deadline established
under subsection (c)’’ the following: ‘‘, or not more
than 60 days after the date on which the Secretary
sends written notice to the local educational agency
pursuant to paragraph (3)(A), as the case may be,’’;
and
(2) in paragraph (3) to read as follows:
‘‘(3) LATE APPLICATIONS.—
‘‘(A) NOTICE.—The Secretary shall, as
soon as practicable after the deadline estab-
lished under subsection (c), provide to each
local educational agency that applied for a pay-
ment under section 8002 or 8003 for the prior
fiscal year, and with respect to which the Sec-
retary has not received an application for a pay-
ment under either such section (as the case
may be) for the fiscal year in question, written
notice of the failure to comply with the deadline
and instruction to ensure that the application is
filed not later than 60 days after the date on
which the Secretary sends the notice.
‘‘(B) ACCEPTANCE
AND
APPROVAL
OF
LATE APPLICATIONS.—The Secretary shall not
accept or approve any application of a local
educational agency that is filed more than 60
days after the date on which the Secretary
sends written notice to the local educational
agency pursuant to subparagraph (A).’’.
SEC. 9. PAYMENTS FOR SUDDEN AND SUBSTANTIAL IN-
CREASES IN ATTENDANCE OF MILITARY DE-
PENDENTS.
Section 8006 of the Elementary and Secondary Edu-
cation Act of 1965 (20 U.S.C. 7706) is repealed.
SEC. 10. CONSTRUCTION.
(a) IN GENERAL.—Section 8007 of the Elementary
and Secondary Education Act of 1965 (20 U.S.C. 7707)
is amended to read as follows:
‘‘SEC. 8007. CONSTRUCTION.
‘‘(a) CONSTRUCTION PAYMENTS AUTHORIZED.—
‘‘(1) IN GENERAL.—From 70 percent of the
amount appropriated for each fiscal year under sec-
tion 8014(e), the Secretary shall make payments in
accordance with this subsection to each local edu-
cational agency that receives a basic support pay-
ment under section 8003(b) for that fiscal year.