§ 6705. — Local government allocations.
[Laws in effect as of January 7, 2003]
[Document not affected by Public Laws enacted between
January 7, 2003 and December 19, 2003]
[CITE: 31USC6705]
TITLE 31--MONEY AND FINANCE
SUBTITLE V--GENERAL ASSISTANCE ADMINISTRATION
CHAPTER 67--FEDERAL PAYMENTS
Sec. 6705. Local government allocations
(a) Indian Tribes and Alaskan Natives Villages.--If there is in a
State an Indian tribe or Alaskan native \1\ village having a recognized
governing body carrying out substantial governmental duties and powers,
the Secretary shall allocate to the tribe or village, out of the amount
allocated to the State under section 6704, an amount bearing the same
ratio to the amount allocated to the State as the population of the
tribe or village bears to the population of the State. The Secretary
shall allocate amounts under this subsection to Indian tribes and
Alaskan native \1\ villages in a State before allocating amounts to
units of general local government in the State under subsection (c). For
the payment period beginning October 1, 1994, the Secretary shall use as
the population of each Indian tribe or Alaskan native \1\ village the
population for 1991 as reported by the Bureau of Indian Affairs in the
publication Indian Service Population and Labor Force Estimates (January
1991). In addition to uses authorized under section 6701(a)(2), amounts
allocated under this subsection and paid to an Indian tribe or Alaskan
native \1\ village under this chapter may be used for renovating or
building prisons or other correctional facilities.
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\1\ So in original. Probably should be capitalized.
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(b) Newly Incorporated Local Governments and Annexed Governments.--
If there is in a State a unit of general local government that has been
incorporated since the date of the collection of the data used by the
Secretary in making allocations pursuant to sections 6704 through 6706
and 6708, the Secretary shall allocate to this newly incorporated local
government, out of the amount allocated to the State under section 6704,
an amount bearing the same ratio to the amount allocated to the State as
the population of the newly incorporated local government bears to the
population of the State. If there is in the State a unit of general
local government that has been annexed since the date of the collection
of the data used by the Secretary in making allocations pursuant to
sections 6704 through 6706 and 6708, the Secretary shall pay the amount
that would have been allocated to this local government to the unit of
general local government that annexed it.
(c) Other Local Government Allocations.--
(1) In general.--The Secretary shall allocate among the units of
general local government in a State (other than units receiving
allocations under subsection (a)) the amount allocated to the State
under section 6704 (as that amount is reduced by allocations under
subsection (a)). Of the amount to be allocated, the Secretary shall
allocate a portion equal to \1/2\ of such amount in accordance with
section 6706(1), and shall allocate a portion equal to \1/2\ of such
amount in accordance with section 6706(2). A unit of general local
government shall receive an amount equal to the sum of amounts
allocated to the unit from each portion.
(2) Ratio.--From each portion to be allocated to units of local
government in a State under paragraph (1), the Secretary shall
allocate to a unit an amount bearing the same ratio to the funds to
be allocated as--
(A) the population of the unit, multiplied by the general
tax effort factor of the unit (determined under paragraph (3)),
multiplied by the income gap of the unit (determined under
paragraph (4)), bears to
(B) the sum of the products determined under subparagraph
(A) for all units in the State for which the income gap for that
portion under paragraph (4) is greater than zero.
(3) General tax effort factor.--(A) Except as provided in
subparagraph (C), the general tax effort factor of a unit of general
local government for a payment period is--
(i) the adjusted taxes of the unit; divided by
(ii) the total income attributed to the unit.
(B) If the amount determined under subparagraphs (A)(i) and (ii)
for a unit of general local government is less than zero, the
general tax effort factor of the unit is deemed to be zero.
(C)(i) Except as otherwise provided in this subparagraph, for
the payment period beginning October 1, 1994, the adjusted taxes of
a unit of general local government are the taxes imposed by the unit
for public purposes (except employee and employer assessments and
contributions to finance retirement and social insurance systems and
other special assessments for capital outlay), as determined by the
Bureau of the Census for the 1987 Census of Governments and adjusted
as follows:
(I) Adjusted taxes equals total taxes times a fraction in
which the numerator is the sum of unrestricted revenues and
revenues dedicated for spending on education minus total
education spending and the denominator is total unrestricted
revenues.
(II) Total taxes is the sum of property tax; general sales
tax; alcoholic beverage tax; amusement tax; insurance premium
tax; motor fuels tax; parimutuels tax; public utilities tax;
tobacco tax; other selective sales tax; alcoholic beverage
licenses, amusement licenses; corporation licenses, hunting and
fishing licenses; motor vehicle licenses; motor vehicle operator
licenses; public utility licenses; occupation and business
licenses, not elsewhere classified; other licenses, individual
income tax; corporation net income tax; death and gift tax;
documentary and stock transfer tax; severance tax; and taxes not
elsewhere classified.
(III) Unrestricted revenues is the sum of total taxes and
intergovernmental revenue from Federal Government, general
revenue sharing; intergovernmental revenue from Federal
Government, other general support; intergovernmental revenue
from Federal Government, other; intergovernmental revenue from
State government, other general support; intergovernmental
revenue from State government, other; intergovernmental revenue
from local governments, other general support; intergovernmental
revenue from local governments, other; miscellaneous general
revenue, property sale-housing and community development;
miscellaneous general revenue, property sale-other property;
miscellaneous general revenue, interest earnings on investments;
miscellaneous general revenue, fines and forfeits; miscellaneous
general revenue, rents; miscellaneous general revenues,
royalties; miscellaneous general revenue, donations from private
sources; miscellaneous general revenue, net lottery revenue
(after prizes and administrative expenses); miscellaneous
general revenue, other miscellaneous general revenue; and all
other general charges, not elsewhere classified.
(IV) Revenues dedicated for spending on education is the sum
of elementary and secondary education, school lunch; elementary
and secondary education, tuition; elementary and secondary
education, other; higher education, auxiliary enterprises;
higher education, other; other education, not elsewhere
classified; intergovernmental revenue from Federal Government,
education; intergovernmental revenue from State government,
education; intergovernmental revenue from local governments,
interschool system revenue; intergovernmental revenue from local
governments, education; interest earnings, higher education;
interest earnings, elementary and secondary education;
miscellaneous revenues, higher education; and miscellaneous
revenues, elementary and secondary education.
(V) Total education spending is the sum of elementary and
secondary education, current operations; elementary and
secondary education, construction; elementary and secondary
education, other capital outlays; elementary and secondary
education, to State governments; elementary and secondary
education, to local governments, not elsewhere classified;
elementary and secondary education, to counties; elementary and
secondary education, to municipalities; elementary and secondary
education, to townships; elementary and secondary education, to
school districts; elementary and secondary education, to special
districts; higher education-auxiliary enterprises, current
operations; higher education-auxiliary enterprises,
construction; higher education, auxiliary enterprises, other
capital outlays; other higher education, current operations;
other higher education, construction; other higher education,
other capital outlays; other higher education, to State
government; other higher education, to local governments, not
elsewhere classified; other higher education, to counties; other
higher education, to municipalities; other higher education, to
townships; other higher education, to school districts; other
higher education, to special districts; education assistance and
subsidies; education, not elsewhere classified, current
operations; education, not elsewhere classified, construction
\2\ education, not elsewhere classified, other capital outlays;
education, not elsewhere classified, to State government;
education, not elsewhere classified, to local governments, not
elsewhere classified; education, not elsewhere classified, to
counties; education, not elsewhere classified, to
municipalities; education, not elsewhere classified, to
townships; education, not elsewhere classified, to school
districts; education, not elsewhere classified, to special
districts; and education, not elsewhere classified, to Federal
Government.
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\2\ So in original. Probably should be followed by a semicolon.
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(VI) If the amount of adjusted taxes is less than zero, the
amount of adjusted tax shall be deemed to be zero.
(VII) If the amount of adjusted taxes exceeds the amount of
total taxes, the amount of adjusted taxes is deemed to equal the
amount of total taxes.
(ii) The Secretary shall, for purposes of clause (i), include
that part of sales taxes transferred to a unit of general local
government that are imposed by a county government in the geographic
area of which is located the unit of general local government as
taxes imposed by the unit for public purposes if--
(I) the county government transfers any part of the revenue
from the taxes to the unit of general local government without
specifying the purpose for which the unit of general local
government may expend the revenue; and
(II) the chief executive officer of the State notifies the
Secretary that the taxes satisfy the requirements of this
clause.
(iii) The adjusted taxes of a unit of general local government
shall not exceed the maximum allowable adjusted taxes for that unit.
(iv) The maximum allowable adjusted taxes for a unit of general
local government is the allowable adjusted taxes of the unit minus
the excess adjusted taxes of the unit.
(v) The allowable adjusted taxes of a unit of general government
is the greater of--
(I) the amount equal to 2.5, multiplied by the per capita
adjusted taxes of all units of general local government of the
same type in the State, multiplied by the population of the
unit; or
(II) the amount equal to the population of the unit,
multiplied by the sum of the adjusted taxes of all units of
municipal local government in the State, divided by the sum of
the populations of all the units of municipal local government
in the State.
(vi) The excess adjusted taxes of a unit of general local
government is the amount equal to--
(I) the adjusted taxes of the unit, minus
(II) 1.5 multiplied by the allowable adjusted taxes of the
unit;
except that if this amount is less than zero then the excess
adjusted taxes of the unit is deemed to be zero.
(vii) For purposes of this subparagraph--
(I) the term ``per capita adjusted taxes of all units of
general local government of the same type'' means the sum of the
adjusted taxes of all units of general local government of the
same type divided by the sum of the populations of all units of
general local government of the same type; and
(II) the term ``units of general local government of the
same type'' means all townships if the unit of general local
government is a township, all municipalities if the unit of
general local government is a municipality, all counties if the
unit of general local government is a county, or all unified
city/county governments if the unit of general local government
is a unified city/county government.
(4) Income gap.--(A) Except as provided in subparagraph (B), the
income gap of a unit of general local government is--
(i) the number which applies under section 6706, multiplied
by the per capita income of the State in which the unit is
located; minus
(ii) the per capita income of the geographic area of the
unit.
(B) If the amount determined under subparagraph (A) for a unit
of general local government is less than zero, then the relative
income factor of the unit is deemed to be zero.
(d) Small Government Allocations.--If the Secretary decides that
information available for a unit of general local government with a
population below a number (of not more than 500) prescribed by the
Secretary is inadequate, the Secretary may allocate to the unit, in lieu
of any allocation under subsection (b) for a payment period, an amount
bearing the same ratio to the total amount to be allocated under
subsection (b) for the period for all units of general local government
in the State as the population of the unit bears to the population of
all units in the State.
(Added Pub. L. 103-322, title III, Sec. 31001(a), Sept. 13, 1994, 108
Stat. 1867.)
Prior Provisions
A prior section 6705, Pub. L. 97-258, Sept. 13, 1982, 96 Stat. 1014,
related to State government allocations, prior to repeal by Pub. L. 99-
272, title XIV, Sec. 14001(a)(1), (e), Apr. 7, 1986, 100 Stat. 327, 329,
eff. Oct. 18, 1986.
Section Referred to in Other Sections
This section is referred to in sections 6704, 6706, 6707, 6708,
6709, 6720 of this title.
