MAINTENANCE AND EFFORT
SEC. 8019. MAINTENANCE OF EFFORT.
Section 8521, <<NOTE: 20 USC 7901.>> as redesignated by section 8001
of this Act, is amended--
(1) in subsection (a), by inserting ``, subject to the
requirements of subsection (b)'' after ``for the second
preceding fiscal year'';
(2) in subsection (b)(1), by inserting before the period at
the end the following: ``, if such local educational agency has
also failed to meet such requirement (as determined using the
measure most favorable to the local agency) for 1 or more of the
5 immediately preceding fiscal years''; and
(3) in subsection (c)(1), by inserting ``or a change in the
organizational structure of the local educational agency'' after
``, such as a natural disaster''.
``SEC. 9521. <<NOTE: 20 USC 7901.>> MAINTENANCE OF EFFORT.
``(a) In General.--A local educational agency may receive funds
under a covered program for any fiscal year only if the State
educational agency finds that either the combined fiscal effort per
student or the aggregate expenditures of the agency and the State with
respect to the provision of free public education by the agency for the
preceding fiscal year was not less than 90 percent of the combined
fiscal effort or aggregate expenditures for the second preceding fiscal
``(b) Reduction in Case of Failure To Meet.--
``(1) In general.--The State educational agency shall reduce
the amount of the allocation of funds under a covered program in
any fiscal year in the exact proportion by which a local
educational agency fails to meet the requirement of subsection
(a) of this section by falling below 90 percent of both the
combined fiscal effort per student and aggregate expenditures
(using the measure most favorable to the local agency).
``(2) Special rule.--No such lesser amount shall be used for
computing the effort required under subsection (a) of this
section for subsequent years.
``(c) Waiver.--The Secretary may waive the requirements of this
section if the Secretary determines that a waiver would be equitable due
``(1) exceptional or uncontrollable circumstances, such as a
natural disaster; or
``(2) a precipitous decline in the financial resources of
the local educational agency.