The Rural Education Achievement Program (REAP) is authorized by Part B of Title V of the Elementary and Secondary Education Act of 1965 (ESEA), as amended by the Every Student Succeeds Act (ESSA, P.L. 114-95 ) in 2015. Congress created this program to address the unique needs of rural schools that disadvantage them relative to non-rural schools. To compensate for the challenges facing rural schools, REAP awards two types of formula grants. The Small, Rural School Achievement (SRSA) program provides funds to rural local educational agencies (LEAs) that serve small numbers of students. The Rural and Low-Income School (RLIS) program provides funds to rural LEAs that serve high concentrations of low-income students, regardless of the LEA's size. Funds appropriated for REAP are divided equally between the SRSA and RLIS programs. The ESSA reauthorization of the REAP statute made major changes to the program by 1. updating the locale codes used for determining the eligibility of LEAs, 2. clarifying that LEAs within educational service agencies are to be considered for SRSA eligibility, 3. extending to RLIS the alternative state certification option for meeting the rural criterion that already existed for SRSA, and 4. giving LEAs the option to choose which program to receive funds under if eligible for both SRSA and RLIS. This report discusses the challenges facing rural schools and the manner in which REAP attempts to address these challenges. According to their proponents, rural schools have some advantages over their urban and suburban counterparts. Rural teachers are key members of the community and tend to know students and their families well. Rural schools often have less complex organizational structures with fewer layers than non-rural school systems, and they may be able to adjust or adapt relatively quickly to change. Additionally, the schools within rural communities are very visible and strongly connected with the community. However, rural schools also confront significant challenges. Many face fiscal limitations due to tax base constraints. Resource shortages contribute to various perceived problems, including a limited range of curricular options (such as a lack of advanced placement course offerings) and difficulties providing competitive salaries to attract and retain highly qualified teachers. Rural schools tend to have declining enrollment due to net out-migration and aging of the population. Rural schools' low population density can result in other problems, such as high transportation costs and limited access to cultural and educational resources. In addition to these general challenges, rural school districts may face particular problems meeting ESEA requirements related to academic accountability and teacher quality. While ESSA provided greater funding use flexibility, rural districts may find it difficult to implement ESEA's requirements for schools identified as in need of improvement (such as providing public school choice). Rural districts may also face difficulty in meeting the ESEA requirement that students receive instruction in the core academic subjects from teachers who are fully certified by the state and have demonstrated competency in the subjects they teach. Additionally, where ESEA funds are concerned, rural LEAs may be at a relative disadvantage compared to non-rural LEAs in both seeking competitive awards and utilizing small formula grant amounts from varied programs. Congress created REAP to meet many of the challenges facing rural schools. According to the statute, the purpose of REAP is to address "the unique needs of rural school districts that frequently (1) lack the personnel and resources needed to compete effectively for Federal competitive grants; and (2) receive formula grant allocations in amounts too small to be effective in meeting their intended purposes." REAP authorizes two rural education programs under ESEA Title V-B. Subpart 1 authorizes the SRSA program, which focuses on LEAs with less than 600 students. Subpart 2 authorizes the RLIS program, which focuses on larger rural LEAs with relatively high poverty rates (at least 20% of children from families below the poverty line). Recipients of grants from these programs may use their funds to support a fairly broad set of educational programs and activities authorized by several ESEA programs. ESSA authorized REAP at $169,840,000 for the fiscal years 2017 through 2020, to be distributed equally between subparts 1 and 2. However, in the Consolidated Appropriations Act, 2017 ( P.L. 115-31 ) Congress appropriated $175,840,000 for REAP. Table 1 shows the history of appropriations for the program. To be eligible for REAP funds, LEAs must be designated rural by the U.S. Department of Education (ED). The National Center for Education Statistics (NCES) has devised a typology to classify schools based on their geographic locations. Using Census Bureau geographic data, NCES assigns "locale codes" to each school. Based on their proximity to urbanized areas and urban clusters, schools are classified along a 12-point urban-to-rural scale as follows (locale codes in parentheses): Large City (11) : Territory inside an urbanized area and inside a principal city with population of 250,000 or more. Midsize City (12) : Territory inside an urbanized area and inside a principal city with population of less than 250,000 and greater than or equal to 100,000. Small City (13) : Territory inside an urbanized area and inside a principal city with population of less than 100,000. Large Suburb (21) : Territory outside a principal city and inside an urbanized area with population of 250,000 or more. Midsize Suburb (22) : Territory outside a principal city and inside an urbanized area with population of less than 250,000 and greater than or equal to 100,000. Small Suburb (23) : Territory outside a principal city and inside an urbanized area with population of less than 100,000. Fringe Town (31) : Territory inside an urban cluster that is less than or equal to 10 miles from an urbanized area. Distant Town (32) : Territory inside an urban cluster that is more than 10 miles and less than or equal to 35 miles from an urbanized area. Remote Town (33) : Territory inside an urban cluster that is more than 35 miles from an urbanized area. Fringe Rural (41) : Census-defined rural territory that is less than or equal to 5 miles from an urbanized area, as well as rural territory that is less than or equal to 2.5 miles from an urban cluster. Distant Rural (42) : Census-defined rural territory that is more than 5 miles but less than or equal to 25 miles from an urbanized area, as well as rural territory that is more than 2.5 miles but less than or equal to 10 miles from an urban cluster. Remote Rural (43) : Census-defined rural territory that is more than 25 miles from an urbanized area and is also more than 10 miles from an urban cluster. An LEA is eligible for the SRSA program if all schools served by the LEA have a locale code of 41, 42, or 43 and either its average daily attendance (ADA) is less than 600 or the county or counties in which the LEA is located has a population density of fewer than 10 people per square mile. The SRSA statute allows the Secretary of Education to waive the locale code requirement (but not the ADA or population density requirements) based on a state government agency's determination that the LEA is located in a rural area. The ESSA amendments made otherwise eligible LEAs within educational service agencies eligible for SRSA funds. LEAs that lost SRSA eligibility due to the ESSA amendments are provided a declining share of prior grant amounts through FY2019 under a hold harmless provision. An LEA is eligible for the RLIS program if all its schools have locale codes of 32, 33, 41, 42, or 43 and at least 20% of the children the LEA serves are from families below the poverty line. The ESSA amendments provided the Secretary with waiver authority for the locale code requirement based on state determination that the LEA is located in a rural area, which previously only existed for the SRSA program. Amounts that LEAs receive and aggregate state amounts are determined differently under the SRSA and RLIS programs. Under the SRSA program, an initial amount is calculated for each eligible LEA and then funds are added based on enrollment and subtracted based on "offsetting" amounts received from other ESEA programs. Under RLIS, grants are first made to states based on a formula and then subgranted to LEAs on either a formula or competitive basis. Congress intended the SRSA program to be a supplement to certain other ESEA grant funds. Thus, an LEA's final SRSA grant amount is based on adjusting its initial amount by the total amount it received from other ESEA programs. The initial SRSA amount is equal to a base grant of $20,000 plus an additional amount for LEAs with enrollments of more than 50 students. The additional amount is equal to $100 for each student in excess of 50 students; however, generally, no grant amount may exceed $60,000. The following are some examples of initial amount calculations: LEAs with 50 students or fewer have initial grant amounts equal to the base amount of $20,000. An LEA with 55 students has an initial amount of $20,500 (i.e., the base amount of $20,000 plus $500, which is $100 times the five students in excess of 50 students). An LEA with 449 students has an initial amount of $59,900 (i.e., the base amount of $20,000 plus $39,900, which is $100 times the 399 students in excess of 50 students).