§ 7709. State consideration of payments in providing State aid
(a)
General prohibition
Except as provided in subsection (b) of this section, a State may not—
(b)
State equalization plans
(1)
In general
A State may reduce State aid to a local educational agency that receives a payment under section
7702 or
7703
(b) of this title (except the amount calculated in excess of 1.0 under section
7703
(a)(2)(B) of this title and, with respect to a local educational agency that receives a payment under section
7703
(b)(2) of this title, the amount in excess of the amount that the agency would receive if the agency were deemed to be an agency eligible to receive a payment under section
7703
(b)(1) of this title and not section
7703
(b)(2) of this title) for any fiscal year if the Secretary determines, and certifies under subsection (c)(3)(A) of this section, that the State has in effect a program of State aid that equalizes expenditures for free public education among local educational agencies in the State.
(2)
Computation
(A)
In general
For purposes of paragraph (1), a program of State aid equalizes expenditures among local educational agencies if, in the second fiscal year preceding the fiscal year for which the determination is made, the amount of per-pupil expenditures made by, or per-pupil revenues available to, the local educational agency in the State with the highest such per-pupil expenditures or revenues did not exceed the amount of such per-pupil expenditures made by, or per-pupil revenues available to, the local educational agency in the State with the lowest such expenditures or revenues by more than 25 percent.
(B)
Other factors
In making a determination under this subsection, the Secretary shall—
(i)
disregard local educational agencies with per-pupil expenditures or revenues above the 95th percentile or below the 5th percentile of such expenditures or revenues in the State; and
(ii)
take into account the extent to which a program of State aid reflects the additional cost of providing free public education in particular types of local educational agencies, such as those that are geographically isolated, or to particular types of students, such as children with disabilities.
(3)
Exception
Notwithstanding paragraph (2), if the Secretary determines that the State has substantially revised its program of State aid, the Secretary may certify such program for any fiscal year only if—
(A)
the Secretary determines, on the basis of projected data, that the State’s program will meet the disparity standard described in paragraph (2) for the fiscal year for which the determination is made; and
(B)
the State provides an assurance to the Secretary that, if final data do not demonstrate that the State’s program met such standard for the fiscal year for which the determination is made, the State will pay to each affected local educational agency the amount by which the State reduced State aid to the local educational agency.
(c)
Procedures for review of State equalization plans
(1)
Written notice
(A)
In general
Any State that wishes to consider payments described in subsection (b)(1) of this section in providing State aid to local educational agencies shall submit to the Secretary, not later than 120 days before the beginning of the State’s fiscal year, a written notice of such State’s intention to do so.
(2)
Opportunity to present views
Before making a determination under subsection (b) of this section, the Secretary shall afford the State, and local educational agencies in the State, an opportunity to present their views.
(3)
Qualification procedures
If the Secretary determines that a program of State aid qualifies under subsection (b) of this section, the Secretary shall—
(d)
Treatment of State aid
(1)
In general
If a State has in effect a program of State aid for free public education for any fiscal year, which is designed to equalize expenditures for free public education among the local educational agencies of that State, payments under this subchapter for any fiscal year may be taken into consideration by such State in determining the relative—
(B)
financial need of such agencies for the provision of free public education for children served by such agency, except that a State may consider as local resources funds received under this subchapter only in proportion to the share that local tax revenues covered under a State equalization program are of total local tax revenues.
(e)
Remedies for State violations
(1)
In general
The Secretary or any aggrieved local educational agency may, not earlier than 150 days after an adverse determination by the Secretary against a State for violation of subsections (a) or (d)(2) of this section or for failure to carry out an assurance under subsection (b)(3)(B) of this section, and if an administrative proceeding has not been concluded within such time, bring an action in a United States district court against such State for such violations or failure.