 
 CHAPTER 70--STRENGTHENING AND IMPROVEMENT OF ELEMENTARY AND SECONDARY 
                                 SCHOOLS
 
         SUBCHAPTER VI--INNOVATIVE EDUCATION PROGRAM STRATEGIES
 
                Part D--General Administrative Provisions
 
Sec. 7371. Maintenance of effort; Federal funds supplementary


(a) Maintenance of effort

                           (1) In general

        Except as provided in paragraph (2), a State is entitled to 
    receive its full allocation of funds under this part for any fiscal 
    year if the Secretary finds that either the combined fiscal effort 
    per student or the aggregate expenditures within the State with 
    respect to the provision of free public education for the fiscal 
    year preceding the fiscal year for which the determination is made 
    was not less than 90 percent of such combined fiscal effort or 
    aggregate expenditures for the second fiscal year preceding the 
    fiscal year for which the determination is made.

                       (2) Reduction of funds

        The Secretary shall reduce the amount of the allocation of funds 
    under this part in any fiscal year in the exact proportion to which 
    the State fails to meet the requirements of paragraph (1) by falling 
    below 90 percent of both the fiscal effort per student and aggregate 
    expenditures (using the measure most favorable to the State), and no 
    such lesser amount shall be used for computing the effort required 
    under paragraph (1) for subsequent years.

                             (3) Waivers

        The Secretary may waive, for one fiscal year only, the 
    requirements of this section if the Secretary determines that such a 
    waiver would be equitable due to exceptional or uncontrollable 
    circumstances such as a natural disaster or a precipitous and 
    unforeseen decline in the financial resources of the State.

(b) Federal funds supplementary

    A State or local educational agency may use and allocate funds 
received under this part only so as to supplement and, to the extent 
practical, increase the level of funds that would, in the absence of 
Federal funds made available under this part, be made available from 
non-Federal sources, and in no case may such funds be used so as to 
supplant funds from non-Federal sources.

(Pub. L. 89-10, title VI, Sec. 6401, as added Pub. L. 103-382, title I, 
Sec. 101, Oct. 20, 1994, 108 Stat. 3712.)
