State and local fiscal assistance act of 1972

MISSING IMAGE

Material Information

Title:
State and local fiscal assistance act of 1972
Physical Description:
Book
Creator:
United States -- Congress. -- Senate. -- Committee on Finance
Publisher:
U.S. Govt. Print. Off. ( Washington )
Publication Date:

Record Information

Rights Management:
All applicable rights reserved by the source institution and holding location.
Resource Identifier:
aleph - 24531770
oclc - 3252239
System ID:
AA00022270:00001

Table of Contents
    Front Cover
        Page i
        Page ii
    Title I. Fiscal assistance to state and local governments
        Page 1
        Page 2
        Page 3
        Page 4
        Page 5
        Page 6
        Page 7
        Page 8
        Page 9
        Page 10
        Page 11
        Page 12
        Page 13
        Page 14
        Page 15
        Page 16
        Page 17
        Page 18
        Page 19
        Page 20
        Page 21
        Page 22
        Page 23
        Page 24
        Page 25
        Page 26
        Page 27
        Page 28
        Page 29
    Back Cover
        Page 30
Full Text
y/.*Pt


Congress I
Session J


COMMITTEE PRINT


7] ? ._- 1-


L<


State and Local Fis


Act of 197


~,

'.~ '


Modifications Made by H.R.

as Referred


13367


TO THE


COMMITTEE ON FINANCE

UNITED STATES SENATE


RUSSELL


B. LONG,


Chairman


JULY 1976


U.S. GOVERNMENT PRINTING OFFICE


WASHINGTON : 1976


94th
2d


- IJ


-% F


73-549



































COMMITTEE ON FINANCE
RUSSELL B. LONG, Louisiana, Chairman


HERMAN E. TALMADGE, Georgia
VANCE HARTKE, Indiana
ABRAHAM RIBICOFF, Connecticut
HARRY F. BYRD, JR., Virginia
GAYLORD NELSON, Wisconsin
WALTER F. MONDALE, Minnesota
MIKE GRAVEL, Alaska
LLOYD BENTSEN, Texas
WILLIAM D. HATHAWAY, Maine
FLOYD K. HASKELL, Colorado


CARL T. CURTIS, Nebraska
PAUL J. FANNIN, Arizona
CLIFFORD P. HANSEN, Wyoming
ROBERT DOLE, Kansas
BOB PACKWOOD, Oregon
WILLIAM V. ROTH, JR., Delaware
BILL BROCK, Tennessee


MICHAEL STERN, Staff Director
DONALD V. MOOREHEAD, Chief Minority Counsel
"I)












TITLE I-FISCAL ASSISTANCE TO STATE AND LOCAL
GOVERNMENTS

Subtitle A-Allocation and Payment of Funds
SEC. 101. SHORT TITLE.
This title may be cited as the "State and Local Fiscal Assistance Act
of 1972"'.
SEC. 102. PAYMENTS TO STATE AND LOCAL GOVERNMENTS.
Except as otherwise provided in this title, the Secretary shall, for
each entitlement period, pay out of the Trust Fund to-
(1) each State government a total amount equal to the entitle-
ment of such State government determined under section 107 for
such period, and
(2) each unit of local government a total amount equal to the
entitlement of such unit determined under section 108 for such
period.
In the case of entitlement periods ending after the date of the enact-
ment of this Act, such payments shall be made in installmhnents, but not
less often than once for each quarter, and, in the case of quarters
ending after September 30, 1972, shall be paid not later than 5 days
after the close of each quarter. Such .payments for any entitlement
period may be initially made on the basis of estimates. Proper adjust-
ment shall be made in the amount of any payment to a State govern-
ment or a unit of local government to the extent that the payments
previously made to such government under this subtitle were in
excess of or less than the amounts required to be paid.
[SEC. 103. USE OF FUNDS BY LOCAL GOVERNMENTS FOR PRIORITY
EXPENDITURES.
[(a) IN GENERAL.-Funds received by units of local government
under this subtitle may be used only for priority expenditures. For
purposes of this title, the term "priority expenditures" means only-
[(1) ordinary and necessary maintenance and operating ex-
penses for-
[(A) public safety (including law enforcement, fire pro-
tection, and building code enforcement),
[ (B) environmental protection (including sewage disposal,
sanitation, and pollution abatement),
[(C) public transportation (including transit systems and
streets and roads),
[(D) health,
[(E) recreation,
[(F) libraries,
[(G) social services for the poor or aged, and
[(H) financial administration; and
[(2) ordinary and necessary capital expenditures authorized by
law.


(1)








[E (b) CERTIFICATES BY LOCAL GOVERNMENTS.-The Secretary is
authorized to accept a certification by the chief executive officer of a
unit of local government that the unit of local government has used
the funds received by it under this subtitle for an entitlement period
only for priority expenditures, unless he determines that such certi-
fication is not sufficiently reliable to enable him to carry out his duties
under this title.
[SEC. 104. PROHIBITION ON USE AS MATCHING FUNDS BY STATE OR
LOCAL GOVERNMENTS.
[(a) IN GENERAL.-No State government or unit of local govern-
ment may use, directly or indirectly, any part of the funds it receives
under this subtitle as a contribution for the purpose of obtaining Fed-
eral funds under any law of the United States which requires such
government to make a contribution in order to receive Federal funds.
[ (b) DETERMINATIONS BY SECRETARY OF THE TREASURY.-If the Sec-
retary has reason to 'believe that a State government or unit of local
government has used funds received under this subtitle in violation of
subsection (a), he shall give reasonable notice and opportunity for
hearing to such government. If, thereafter, the Secretary of the Treas-
ury determines that such government 'has used funds in violation of
subsection (a), he shall notify such government of his determination
and shall request repayment to the United States of an amount
equal to the funds so used. To the extent that such government fails to
repay such amount, the Secretary shall withhold from subsequent
payments to such government under this subtitle an amount equal to
the funds so used.
[(c) INCREASED STATE OR LOCAL GOVERNMENT REVENUES.-No State
government or unit of local government shall be determined to have
used funds in violation of subsection (a) with respect to any funds
received for any entitlement period to the extent that the net revenues
received by it from its own sources during such period exceed the net
revenues received by it from its own sources during the one-year period
beginning July 1, 1971 (or one-half of such nret revenues, in the case
of an entitlement period of 6 months).
[(d) DEPOSITS AND TRANSFERS TO GENERAL FUND.-Any amount
repaid by a State government or unit or local government under sub-
section (b) shall be deposited in the general fund of the Treasury. An
amount equal to the reduction in payments to any State government or
unit of local government which results from the application of this sec-
tion (after any judicial review under section 143) shall be transferred
from the Trust Fund to the general fund of the Treasury on the (lay
on which such reduction becomes final.
[(e) CERTIFICATES BY STATE AND LOCAL GOVERNMENTS.-The Secre-
tary is authorized to accept a certification by the Governor of a State
or the chief executive officer of a unit of local government that the
State government or unit of local government has not used any funds
received by it under this subtitle for an entitlement period in violation
of subsection (a) ; unless lie determines that such certification is not
sufficiently reliable to enable him to carry out his duties under this
title.]








SEC. 105. CREATION OF TRUST FUND; APPROPRIATIONS; AUTHORIZA-
TIONS FOR ENTITLEMENTS.
(a) TRUST FUND.-
(1) IN GENERAL.-There is hereby established on the books of
the Treasury of the United States a trust fund to be known as the
"State and Local Government Fiscal Assistance Trust Fund"
(referred to in this subtitle as the "Trust Fund"). The Trust Fund
shall remain available without fiscal year limitation and shall con-
sist of such amounts as may be appropriated to it and deposited
in it as provided in subsection (b) or in an appropriations aet. Ex-
cept as provided in this title, amounts in the Trust Fund may be
used only for the payments to State and local governments pro-
vided by this subtitle.
(2) TR:USTEE.-The Secretary of the Treasury shall be the
trustee of the Trust Fund and shall report to the Congress not
later than [March 1] January 15 of each year on the operation
and status of the Trust Fund during the preceding fiscal year.
(b) APPROPRIATIONS.-
(1) IN (GENERAL.-There is appropriated to the Trust Fund, out
of amounts in the general fund of the Treasury attributable to the
collections of the Federal individual income taxes not otherwise
appropriated-
(A) for the period beginning January 1, 1972, and ending
June 30,1972, $2,650,000,000;
(B) for the period beginning July 1, 1972, and ending
December 31, 1972, $2.650,000,000;
(C) for the period beginning January 1, 1973, and ending
June 30, 1973, $2,987,500,000;
(D) for the fiscal year beginning July 1. 1973,
$6,050,000,000 ;
(E) for the fiscal year beginning July 1 1974,
$6,200,000,000;
(F) for the fiscal year beginning July 1, 1975,
$6,350,000,000; and
(G) for the period beginning July 1, 1976, and ending
December 31, 1976, $3,325,000,000.
(2) NONCONTIG(,,UO(l-" STATES ADJUSTMENT AMOUNTS.-Therl'e is
appropriated to the Trust Fund, out of amounts in the general
fund of the Treasury attributable to the collections of the Federal
individual income taxes not otherwise appropriated-
(A) for the period beginning January 1, 1972. and ending
June 30, 1972, $2,390,000;
(B) for the period beginning July 1. 1972, and ending
December 31, 1972, $2.390,000 ;
(C) for the period beginning January 1, 1973, and ending
June 30. 1973, $2,390,000
(D) for each of the fiscal years beginning July 1. 1973,
July 1, 1974, and July 1, 1975, $4.780.000: and
(E) for the period beginning July 1, 1976, and ending
December 31,1976, $2,390,000.







(3) DEPoSrrs.-Amount appropriated by paragraph (1) or (2)
for any fiscal year or other period shallbe deposited in the Trust
Fund on the later of (A) the first day of such year or period, or
(B) the day after the day of enactment of this Act.
(c) AUTHORIZATIONV OF APPROPRIATIONS FOR E.NTITLEMENTS.--
(1) "Lv GENERAL.-There are authorized to be appropriated to
the Trust Fund to pay the entitlements hereinafter provided-
(A) for the period beginning January 1, 1977, and end-
ing September 30,1977, $4,987,500,000; and
(B) for the fiscal years beginning October 1 of 1977, 1978,
and 1979, $6,650,000,000.
(2) NONCONTIGUOUS STATES ADJUSTMENT AMOUNTS.-There are
authorized to be appropriated to the Trust Fund to pay the en-
titlements hereinafter provided-
(A) for the period beginning January 1,1977, and ending
September 30,1977, $3,585,000; and
(B) for each of the fiscal years beginning on October 1 of
1977,1978, and 1979, $4,780,000.
I(c)] (d) TRAN-SFES FROM. TRUST FUND TO GENERAL FUND.-The
Secretary shall from time to time transfer from the Trust Fund to
the general fund of the Treasury any moneys in the Trust Fund which
he determines will not be needed to make payments to State govern-
ments and units of local government under this subtitle.
SEC. 106. ALLOCATION AMONG STATES.
[(a) IN GENERAL.-There shall be allocated to each State for each
entitlement period, out of amounts appropriated under section 105
(b) (1) for that entitlement period, an amount which bears the same
ratio to the amount appropriated under this section for that period
as the amount allocable to that State under subsection (b) bears to the
sum of the amounts allocable to all States under subsection (b).]
(a) IN GENERAL.-There shall be allocated an entitlement to each
State-
(1) for each entitlement period beginning prior to Decem-
ber; 31,1976, out of amounts appropriated under section 105(b) (1)
for that entitlement period, an amount which bears the same ratio
to the amount appropriated under that section for that period as
the amount allocable to that State under subsection (b) bears to
the sum of the amounts allocable to all Slates under subsection
(b) ; and
(2) for each entitlement period beginning on or after Janu-
ary 1, 1977, out of amounts authorized under section 105(c) (1)
for that entltfe ment period, an amount which bears the same ratio
to the amount authorized under that section for that period as the
amount allocable to that State under subsection (b) bears to the
sum of the amounts allocable to all States under subsection (b).
(b) DETERMINATION OF ALLOCABI-E AMOUNT.-
(1) IN GENERAL.-For purposes of subsection (a), the amount
allocable to a State under this subsection for any entitlement
period shall be determined under paragraph (2), except that such
amount shall be determined under paragraph (3) if the amount







allocable to it under paragraph (3) is greater than the sum of the
amounts allocable to it under paragraph (2) and subsection (c).
(2) THREE FACTOR FORMULA.-For purposes of paragraph (1),
the amount allocable to a State under this paragraph for any
entitlement period is the amount which bears the same ratio to
$5,300,000,000 as-
(A) the population of that State, multiplied by the general
tax effort factor of that State, multiplied by the relative in-
come factor of that State, bears to
(B) the sum of the products determined under subpara-
graph (A) for all States.
(3) FIVE FACTOR FORMULA.-For purposes of paragraph (1),
the amount allocable to a State under this paragraph for any
entitlement period is the amount to which that State would be
entitled if-
(A) 1/3 of $3,500,000,000 were allocated among the States
on the basis of population,
(B) 1/3 of $3,500,000,000 were allocated among the States
on the basis of urbanized population,
(C) 1/3 of $3,500,000,000 were allocated among the States
on the basis of population inversely weighted for per capital
income,
(D) /2 of $1,800,000,000 were allocated among the States
on the basis of income tax collections, and
(E) 1/ of $1,800,000,000 were allocated among the States
on the basis of general tax effort.
(c) NONCONTIGUOUS STATES ADJUSTMENT.-
(1) Ix GENERAL.-In addition to amounts allocated among the
States under subsection (a), there shall be allocated for each en-
titlement period, out of amounts appropriated under [section 105
(b)(2)] subsection (b)(2) or (c) (2) of section 105, an addi-
tional amount to any State (A) whose allocation under subsection
(b) is determined by the formula set forth in paragraph (2) of
that subsection and (B) in which civilian employees of the United
States Government receive an allowance under section 5941 of
title 5, United States Code.
(2) DETERMINATION OF AMOUNT.-The additional amount al-
locable to any State under this subsection for any entitlement
period is an amount equal to a percentage of the amount allocable
to that State under subsection (b) (2) for that period which is the
same as the percentage of basic pay received by such employees
stationed in that State as an allowance under such sect ion 5941. If
the total amount appropriated under section 105(b) (2) for any
(eiltitlement period ending on or before December 31, 1976, or
(tfthorized under section 105(c) (2) for any entitlenict period
begin? ing on or after January 1, 1977, is not sufficient to pay in
full the additional amounts allocable under this subsection for
that period, the Secretary shall reduce proportionately the
amounts so allocable.
SEC. 107. ENTITLEMENTS OF STATE GOVERNMENTS.
(a) Divisiox BETWEEN STATE AND LOCAL GOVERNMENTS.-The
State government, shall be entitled to receive one-third'of the amount







allocated to that State for each entitlement period. The remaining por-
tion of each State's allocation shall be allocated among thle units of
local government of that State as provided in section 108.
(b) STATE MUST MAINTAIN TRANSFERS TO LOCAL GO-VERI-MENT.-
(1) GENERAL RULE.-The entitlement of any State government
for any entitlement period beginning on or after [July 1, 1973,]
January 1, 1977, shall be reduced by the amount (if any) by
which-
(A) the average of the aggregate amounts transferred by
the State government (out of its own sources) during such
period and the preceding entitlement period to all units of
local government in such State, is less than,
[(B) the similar aggregate amount for the one-year period
beginning July 1, 1971.]
(B) the similar aggregate amount for the onw-year period
beginnhig Judy 1, 1975, or, wutil data on such perod are avail-
able, the most recent such one-yeai' period for wh (.h data on
such amounts are available.
For purposes of subparagraph (A), the amount of any reduction
in the entitlement of a State government under this subsection
for any entitlement period shall. for subsequent entitlement
periods, be treated as an amount transferred by the State govern-
ment (out of its own sources) during such period to units of
local government in such State.
: (2) ADJUSTMENT WHERE STATE ASSUMES RESPONSIBILITY FOR
CATEGORY OF EXPENDITURES.-If the State government establishes
to the satisfaction of the Secretary that since June 30,1972, it has
assumed responsibility for a category of expenditures which
(before July 1, 1972) was the responsibility of local governments
located in such State, then. under regulations prescribed by the
Secretary, the aggregate amount taken into account under para-
graph (1) (B) shall be reduced to tihe extent that increased State
government spending (out of its own sources) for such category
has replaced corresponding amounts which for the one-year period
[beginning July 1,1971.] utilized for purposes of such paragraph
it transferred to units of local government.
(3) ADJUSTMENT WHERE NEW TAXING POWERS ARE CONFERRED
UPON LOCAL GOVERNMENTS.-If a State establishes to the satisfac-
tion of the Secretary that since June 30,197:2. onie or more units of
local government within such State have had conferred upon them
new taxing authority, then, under regulations prescribed by the
Secretary, the aggregate amount taken into account under para-
graph (1) (B) shall be reduced to the extent of the larger of-
(A) an amount equal to the amount of the taxes collected
by reason of the exercise of such new taxing authority by
such local governments, or
(B) an amount equal to the amount of the loss of revenue
to the State by reason of such new taxing authority being
conferred on such local governments.
No amount shall be taken into consideration under subparagraph
(A) if such new taxing authority is an increase in the authorized
rate of tax under a previously authorized kind of tax, unless the







State is determined by the Secretary to have decreased a related
State tax.
(4) SPECIAL RULE FOR PERIOD BEGINNING JULY 1, 1973.--In the
case of the entitlement period beginning July 1, 1973, the preced-
ing entitlement period for purposes of paragraph (1)(A) shall
be treated as being the one-year period beginning July 1, 1972.
(5) SPECIAL RULE FOR PERIOD BEGINNING JULY 1, 1976.-In the
case of the entitlement period beginning July 1, 1976, and ending
December 31, 1976, the aggregate amount taken into account un-
der paragraph (1) (A) for the preceding entitlement period and
the aggregate amount taken into account under paragraph (1)
(B) shall be one-half of the amounts which (but for this para-
graph) would be taken into account.
(6) SPECIAL RULE FOR THE PERIOD BEGINNING JANUARY 1, 1977.-
In the case of the entitlement period beginning January 1, 1977.
and ending September 30, 1977, the aggregate amount taken into
account under paragraph (1) (A) for the preceding entitlement
period and the aggregate amount taken into account under para-
graph (1) (B) shall be three-fourths of the amounts which (but
for this paragraph) would be taken. into account.
[(6)](7) REDUC(TION IN ENTITLEMENT.-If the Secretary has
reason to believe that paragraph (1) requires a reduction in the
entitlement of any State government for any entitlement period,
he shall give reasonable notice and opportunity for hearing to the
State. If, thereafter, he determines that paragraph (1) requires
the reduction of such entitlement, he shall also determine the
amount of such reduction and shall notify the Governor of such
State of such determinations and shall withhold from subsequent
payments to such State government under this subtitle an amount
equal to such reduction.
[(7) ] (8) TRANSFER TO GENERAL FUND.-An amount equal to the
reduction in the entitlement of any State government which
results froni the application of this subsection (after any judicial
review under section 143) shall be transferred from the Trust
Fund to the general fund of the Treasury on the day on which such
reduction becomes final.
SEC. 108. ENTITLEMENTS OF LOCAL GOVERNMENTS.
(a) ALLOCATION AMONG COUNTY AREAS.-The amount to be allo-
cated to the units of local government within a State for any entitle-
ment period shall be allocated among the county areas located in that
State so that each county area will receive an amount which bears the
same ratio to the total amount to be allocated to the units of local
government within that State as-
(1) the population of that county area, multiplied by the
general tax effort factor of that county area, multiplied by the
relative income factor of that county area, bears to
(2) the sum of the products determined under paragraph (1)
for all county areas within that State.
(b) ALLOCATION TO COUNTY GOVERNMENTS, MUNICIPALITIES, ToWx-
SHIPS, ETC.-
(1) COUNTY GOVERNMENTS.-The county government shall be
allocated that portion of the amount allocated to 'the county area







for the entitlement period under subsection (a) which bears the
same ratio to such amount as the adjusted taxes of the county
government bear to the adjusted taxes of the county government
and all other units of local government located in the county area.
(2) OTHER UNITS OF LOCAL GOVERNMENT.-The amount remain-
ing for allocation within a county area after the application of
paragraph (1) shall be allocated among the units of local gov-
ernment (other than the county government and other than town-
ship governments) located in that county area so that each unit
of local government will receive an amount which bears the same
ratio to the total amount to be allocated to all such units as--
(A) the population of that local government, multiplied by
the general tax effort factor of that local government, multi-
plied by the relative income factor of that local government,
bears to
(B) the sum of the products determined under subpara-
graph (A) for all such units.
(3) TOWNSHIP GOVERNMENTS.-If the county area includes one
or more township governments, then before applying paragraph
(2)-
(A) there shall be set aside for allocation under subpara-
graph (B) to such township governments that portion of the
amount allocated to the country area for the entitlement
period which bears the same ratio to such amount as the sum
of the adjusted taxes of all such township governments bears
to the aggregate adjusted taxes of the county government,
such township governments, and all other units of local gov-
ernment located in the county area, and
(B) that portion of each amount set aside under subpara-
graph (A) shall be allocated to each township government
on the same basis as amounts are allocated to units of local
government under paragraph (2).
If this paragraph applies with respect to any county area for any
entitlement period, the remaining portion allocated under para-
graph (2) to the units of local government located in the county
area (other than the county government and the township govern-
ments) shall be appropriately reduced to reflect the amounts set
aside under subparagraph (A).
(4) INDIAN TRIBES AND ALASKAN NATIVE VILLAGES.-If within a
county area there is an Indian tribe or Alaskan native village
which has a recognized governing body which performs substan-
tial governmental functions, then before applying paragraph (1)
there shall be allocated to such tribe or village a portion of the
amount allocated to the county area for the entitlement period
which bears the same ratio to such amount as the population of
that tribe or village within that county area bears to the popula-
tion of that county area. If this paragraph applies with respect
to any county) area for any entitlement period, the amount to be
allocated under paragraph (1) shall be appropriately reduced
to reflect the amount allocated under the preceding sentence. If
the entitlement of any such tribe or village is waived for any
entitlement period by the governing body of that tribe or village,







then the provisions of this paragraph shall not apply with respect
to the amount of such entitlement for such period.
(5) RULE FOR SMALL UNITS OF GOVERNMENT.-If the Secretary
determines that in any county area the data available for any
entitlement period are not adequate for the application of the
formulas set forth in paragraphs (2) and (3) (B) with respect to
units of local government (other than a county government) with
a population below a number (not more than 500) prescribed for
that county area by the Secretary, he may apply paragraph (2)
or (3) (B) by allocating for such entitlement period to each such
unit located in that county area an amount which bears the same
ratio to the total amount to be allocated under paragraph (2)
or (3) (B) for such entitlement period as the population of such
unit bears to the population of all units of local government in
that county area to which allocations are made under such para-
graph. If the preceding sentence applies with respect to any
county area, the total amount to be allocated under paragraph
(2) or (3) (B) to other units of local government in that county
area for the entitlement period shall be appropriately reduced
to reflect the amounts allocated under the preceding sentence.
(6) ENTITLEMENT.
(A) IN GENMEL.-Except as otherwise provided in this
paragraph, the entitlement of any unit of local government for
any entitlement period shall be the amount allocated to such
unit under this subsection (after taking into account any
applicable modification under subsection (c)).
(B) MAXIMUM AND MINIMUM PER CAPITAL ENTITLEMENT.-
Subject to the provisions of subparagraphs (C) and (D), the
per capital amount allocated to any county area or any unit of
local government (other than a county government) within a
State under this section for any entitlement period shall not
be less than 20 percent, nor more than 145 percent, of two-
thirds of the amount allocated to the State under section 106,
divided by the population of that State.
(C) LIMITATION.-The amount allocated to any unit of
local government under this section for any entitlement period
shall not exceed 50 percent of the sum of (i) such government's
adjusted taxes, and (ii) the intergovernmental transfers of
revenue to such government (other than transfers to such
government under this subtitle).
(D) ENTITLEMENT LESS THAN $200, OR GOVERNING BODY
WAIVES ENTITLEMEXNT.-If (but for this subparagraph) the
entitlement of any unit of local government below the level of
the county government-
(i) would be less than $200 for any entitlement period
($100 for an entitlement period of 6 months, $150 for an
entitlement period of 9 months), or
(ii) is waived for any entitlement period by the gov-
erning body of such unit,
then the amount of such entitlement for such period shall (in
lieu of being paid to such unit) be added to, and shall be-
come a part of, the entitlement for such period of the county
government of the county area in which such unit is located.






10


(7) ADJUSTMENT OF ENTITLEMENT.-
(A) IN GENERAL.-In adjusting the allocation of any county
area or unit of local government, the Secretary shall make any
adjustment required under paragraph (6) (B) first, any adjust-
ment required under paragraph (6) (C) next, and any adjustment
required under paragraph (6) (D) last.
(B) ADJUSTMENT FOR APPLICATION OF MAXIMUM OR MINIMUM
PER CAPITA ENTITLEIMENT.-The Secretary shall adjust the alloca-
tions made under this section to county areas or to units of local
governments in any State in order to bring those allocations into
compliance with the provisions of paragraph (6) (B). In making
such adjustments he shall make any necessary adjustments with
respect to county areas before making any necessary adjustments
with respect to units of local government.
(C) ADJUSTMENT FOR APPLICATION OF LIMITATION.-In any case
in which the amount allocated to a unit of local government is re-
duced under paragraph (6) (C) by the Secretary, the amount of
that reduction-
(i) in the case of a unit of local government (other than
a county government), shall be added to and increase the
allocation of the county government of the county area in
which it is located, unless (on account of the application of
paragraph (6)) that county government may not receive it,
in which case the amount of the reduction shall be added to
and increase the entitlement of the State government of the
State in which that unit of local government is located; and
(ii) in the case of a county government, shall be added to
and increase the entitlement of the State government of the
State in which it is located.
(c) SPECIAL ALLOCATION RULES.--
(1) OPTIONAL FORMrULA.-A State may by law provide for the
allocation of funds among county areas, or among units of local
government (other than county governments), on the basis of the
population multiplied by the general tax effort factors of such
areas or units of local government, on the basis of the population
multiplied by the relative income factors of such areas or units
of local government, or on the basis of a combination of those
two factors. Any State which provides by law for such a variation
in the allocation !formula provided by subsection (a), or by para-
graphs (2) and (3) of subsection (b), shall notify the Secretary
of such law not later than 30 days before the beginning of the first
entitlement period to which such law is to apply. Any such law
shall
(A) provide for allocating 100 percent of the aggregate
amount to be allocated under subsection (a), or under para-
granlis ('2) and (3) of subsection (b);
(B) apply uniformly throughout the State; and
(C) apply during the period beginning on the first day of
the first entitlement period to which it applies and ending
on December 31,1976.] Septemb6er 30. 1980.
(2) CERTiFIcATroN.-Parasraph (1) shall apply within a State
only if the Secretary certifies that thle Staie law complies with
the requirements of such paragraph. The Secretary shall not







certify any such law with respect to which he receives notifi'a-
tion later than 30 days prior to the first entitlement period dur-
ing which it is to apply.
(d) GOVERNMENTAL DEFINITIONS AND RELATED RULES.-For pur'-
poses of this title-
[ (1) UNITS OF LOCAL GOVERNMENT.-The term "unit of local gov-
ernment" means the government of a county, municipality, town-
ship, or other unit of government below the State which is a unit
of general government (determined on the basis of the same prin-
ciples as are used by the Bureau of the Census for general statis-
tical purposes). Such term also menns, except for purposes of
paragraphs (1), (2), (3), (5), (6)(C), and (6)(D) of subsec-
tion (b), and, except for purposes of subsection (c), the recog-
nized governing body of an Indian tribe or Alaskan native village
which performs substantial governmental functions.]
(1) UNIT OF LOCAL GOVERNMENT.-
(A) IN, GENERAL.-The term "iw)?t of local government"
means the goern nment of a county, mn uiicipality, or towns hp
which is a unit of general government as determined by the
Bureau of the Census for general statistical purposes, and
which, with respect to entilement periods begbin'.q on or
after October 1, 1977, meets the requirements spet,;fied in -o/b-
paraqraph (B), and imposes taxes or rceres intergovern-
mental transfers for substantial per formance of at least tco
of the follo,'iqng seirrices for its citizens: (A) police protec-
tion; (B) courts and corrections; (C) fire protection; (D)
health services: (E) social services for the poor or aged: (F)
public recreation; (G) public libraries.; (H) zoning or land
use planning: (I) .sc'rrage d(;.iposal or wafer supply; (J)
solid waste disposal; (K) pollution abatement; (L) road or
streett cons-f-nction and maintenance; (M) mass transporta-
tion; and (N) education. Such term also means, except for
purposes of paragraphs (1), (2), (3), (5), (6)(C), and
(6) (D) of subsection (b), andl, e.,r-cpt for purposes of sub-
section (c). the recoqgdzed qo'rrenbq body of an Indian tribe
or Alaska Native village which performs substantial gover,-
mental functions. For the purposes of this subsection a unit
of local government shall be deemed to impose a tax if that
tax is collected by another governmental entity from the geo-
graphical area qPer'f'd by that unit of local go'iernlaent and
an amount equu;,alent to the net proceeds of that tax are paid
to that unit of local government.
(B) LIMITATION.-To be considered a unit of local gov-
ernment for purposes of this Act, at least 10 per centum of a
local gorrt-inen t's total expenditIr( s (exclusive of x.-rpend;-
tures for general and financial adinl;;hstration and for the
ass.essmnent of property) in the most rce',nt fl.,erl year mu,.t
have been for each of two of the public services listYrd in sub-
paragraph (A), except that the foregoing restrirtion shall
not apply to a unit of local goiernqnent (i) which substan-
tially performs four or more of such public services or (ii)
which has performed two or more of such public scrrices since






12


January 1, 1976, and continues to provide two or minore such
public services.
(2) CERTAIN" AREAS TREATED AS COUNTIES.-In any State in
which any unit of local government (other than a county govern-
ment) constitutes the next level of government below the State
government level, then, except as provided in the next sentence,
the geographic area of such unit of government shall be. treated
as a county area (and such unit of government shall be treated as
a county government) with respect to that portion of the State's
geographic area. In any State in which any county area is not
governed by a county government but contains two or more units
of local government, such units shall not be treated as county
governments and the geographic areas of such units shall not be
treated as county areas.
(3) TOWNSHIPS.-The term "township" includes equivalent
subdivisions of government having different designations (such
as "towns"), and shall be determined on the basis of the same
principles as are used by the Bureau of the Census for general
statistical purposes.
(4) UNITS OF LOCAL GOVERNMENT LOCATED IN LARGER ENTITY.-A
unit of local government shall be treated as located in a larger
entity if part or all of its geographic area is located in the larger
entity.
(5) ONLY PART OF UNIT LOCATED LARGER ENTrrY.-If only part
of a unit of local government is located in a larger entity, such
part shall be treated for allocation purposes as a separate unit of
local government, and all computations shall, except as otherwise
provided in regulations, be made on the basis of the ratio which
the estimated population of such part bears to the population of
the entirety of such unit.
(6) BOUNDARY CHANGES, GOVERNMENTAL REORGANIZATION, ETC.-
If, by reason of boundary line changes, by reason of State statu-
tory or constitutional changes, by reason' of annexations or other
governmental reorganizations, or by reason of other circum-
stances, the application of any provision of this section to units of
local government does not carry out the purposes of this subtitle,
the application of such provision shall be made, under regulations
prescribed by the Secretary, in a manner which is consistent with
such purposes.
SEC. 109. DEFINITIONS AND SPECIAL RULES FOR APPLICATION OF
ALLOCATION FORMULAS.
(a) IN GENERAL.-For purposes of this subtitle-
(1) POPULATION.-Population shall be determined on the same
basis as resident population is determined by the Bureau of the
Census for general statistical purposes.
(2) URBANIZED POPULATION.-Urbanized population means
the population of any area consisting of a central city or cities of
50,000 or more inhabitants (and of the surrounding closely settled
territory for such city or cities) which is treated as an urbanized
area by the Bureau of the Census for general statistical purposes.
(3) INCOME.-Income means total money income received from
all sources, as determined by the Bureau of the Census for general
statistical purposes.








(4) PER[SONAL 1NCo3ME.-Personal income means the income of
individuals, as determined by the Department of Commerce for
national income accounts purposes.
(5) DATES FOR DETERMINING ALLOCATIONS AND ENTITLEMENTS.-
Except as provided in regulations, the determination of alloca-
tions and entitlements for any entitlement period shall be made
as of the first day of the third month immediately preceding the
beginning of such period.
(6) INTERGOVERNMENTAL TRANSFERS.-The intergovernmental
transfers of revenue to any government are the amounts of revenue
received by that government from other governments as a share in
financing (or as reimbursement for) the performance of govern-
mental functions, as determined by the Bureau of the Census for
general statistical purposes.
(7) DATA USED; UNIFOR-MITY OF DATA.-
(A) GENERAL RULE.-Except as provided in subparagraph
(B), the data used shall be the most recently available data
provided by the Bureau of the Census or the Department of
Commerce, as the case may be.
(B) USE OF ESTIMIATES, ETC.-Wl here the Secretary deter-
mines that the data referred to in subparagraph (A) are not
current enough or are not comprehensive enough to provide
for equitable allocations, he may use such additional data
(including data based on estimates) as may be provided for
in regulations.
(b) INXCOME TAX AMOUNT OF STATES.-For purposes of this sub-
title-
(1) IN GENERAL.-The income tax amount of any State for any
entitlement period is the income tax amount of such State as deter-
mined under paragraphs (2) and (3).
(2) INCOME TAX AM3OUNT.-The income tax amount of any State
for any entitlement period is 15 percent of the net amount collected
from the State individual income tax of such State during 1972 or
(if later) during the last calendar year ending before the begin-
ning of such entitlement period.
(3) CEILING AND FLOOR.-The income tax amount of any State
for any entitlement period-
(A) shall not exceed 6 percent, and
(B) shall not be less than 1 percent,
of the Federal individual income tax liabilities attributed to such
State for taxable years ending during 1971 or (if later) during
the last calendar year ending before the beginning of such entitle-
ment period.
(4) STATE INDIVIDUAL INCOME TAX.-The individual income tax
of any State is the tax imposed upon the income of individuals by
such State and described as a State income tax under section
164(a) (3) of the Internal Revenue Code of 1954.
(5) FEDERAL INDIVIDUAL INCOME TAX LIABILITIES.-Federal indi-
vidual income tax liabilities attributed to any State for any period
shall be determined on the same basis as such liabilities lare deter-
mined for such period by the Internal Revenue Seryice for general
statistical purposes.






14


(c) GENERAL TAX EFFORT OF STATES.-
(1) IN GENERAL.-For purposes of this subtitle-
(A) GENERAL TAX EFFORT FACTOR.-The general tax effort
factor of any State for any entitlement period is (i) the net
amount collected from the State and local taxes of such State
during the most recent reporting year, divided by (ii) the
aggregate personal income (as defined in paragraph (4) of
subsection (a)) attributed to such State for the same period..
(B) GENERAL TAX EFFORT AMOUNT.-The general tax effort
amount of any State for any entitlement period is the amount
determined by multiplying-
(i) the net amount collected from the State and local
taxes of such State during the most recent reporting year
by
(ii) the general tax effort factor of that State.
(2) STATE AND LOCAL TAXES.-
(A) TAXES TAKEN INTO ACCOUNT.-The State and local
taxes taken into account under paragraph (1) are the com-
pulsory contributions exacted by the State (or by any unit of
local government or other political subdivision of the State)
for public purposes (other than employee and employer
assessments and contributions to finance Iretirement and social
insurance systems, and other than special assessments for
capital outlay), as such contributions 'are determined by the
Bureau of the Census for general statistical purposes.
(B) MOST RECENT REPORTING YEAR.-The most recent re-
porting year with respect to any entitlement period consists
of the years taken into account by the Bureau of the Census
in its most recent general determination of State and local
taxes made before the close of such period.
(d) GENERAL TAX EFFORT FACTOR OF COUNTY AREA.-For purposes
of this subtitle, the general tax effort factor of any county area for
any entitlement period is-
(1) the adjusted taxes of the county government plus the ad-
justed taxes of each other unit of local government within that
county area, divided by
(2) the aggregate income (as defined in paragraph (3) of sub-
section (a)) attributed to that county area.
(e) GENERAL TAX EFFORT FACTOR OF UNIT OF LOCAL GOVERN-
MENT.-For purposes of this subtitle-
(1) IN GENERAL.-The general tax effort factor of any unit of
local government for any entitlement period is-
(A) the adjusted taxes of that unit of local government,
divided by
(B) the aggregate income (as defined in paragraph (3) of
subsection (a)) attributed to that unit of local government.
(2) ADJUSTED TAXES.-
(A) IN GENERAL.-The adjusted taxes of any unit of local
government are-
(i) the compulsory contributions exacted by such
government for public purposes (other than employee
and employer assessments and contributions to finance
retirement and social insurance systems, and other than







special assessments for capital outlay), as such contri-
butions are determined by the Bureau of the Census for
general statistical purposes,
(ii) adjusted (under regulations prescribed by the
Secretary) by excluding an amount equal to that portion
of such compulsory contributions which is properly allo-
cable to expenses for education.
(B) CERTAIN SALES TAXES COLLECTED BY COUNTIES.-In any
case where-
(i) a county government exacts sales taxes within the
geographic area of a unit of local government and
transfers part or all of such taxes to such unit without
specifying the purposes for which such unit may spend
the revenues, and
(ii) the Governor of the State notifies the Secretary
that the requirements of this subparagraph have been
met with respect to such taxes.
then the taxes so transferred shall be treated as the taxes of
the unit of local government (and not the taxes of the
county government).
(f) RELATIVE INCOME FACTOR.-For purpose of this subtitle, the
relative income factor is a fraction-
(1) in the case of a State, the numerator of which is the per
capital income of the United States and the denominator of which
is the per capital income of that State;
(2) in the case of a county area, the numerator of which is the
per capital income of the State in which it is located and the denom-
inator of which is the per capital income of that county area; and
(3) in the case of a unit of local government, the numerator of
which is the per capital income of the county area in which it is
located and the denominator of which is the per capital income of
the geographic area of that unit of local government.
For purposes of this subsection, per capital income shall be determined
on the basis of income as defined in paragraph (3) of subsection (a).
(g) ALLOCATION RULES FOR, FIVE FACTOR FORmULA.-For purposes
of section 106(b) (3)-
(1) ALLOCATION ON BASIS OF POPULATION.-Any allocation
among the States on the basis of population shall be made by
allocating to each State an amount which bears the same ratio to
the total amount to be allocated as the population of such State
bears to the population of all the States.
(2) ALLOCATION ON BASIS OF URBANIZED POPULATION.--Any
allocation among the States on the basis of urbanized population
shall be made by allocating to each State an amount which bears
the same ratio to the total amount to be allocated as the urbanized
population of such State bears to the urbanized population of all
the States.
(3) ALLOCATION ON BASIS OF POPULATION INVERSELY WEIGHTED
FOR PER CAPITA INCOME.-Any allocation among the States on
the basis of population inversely weighted for per capital income
shall be made by allocating to each State an amount which bears
the same ratio to the total amount to be allocated as-







(A) the population of such State, multiplied by a fraction
the numerator of which is the per capital income of all the
States and the denominator of which is the per capital income
of such State, bears to
(B) the sum of the products determined under subpara-
graph (A) for all the States.
(4) ALLOCATION ON BASIS OF INCOME TAX COLLECTIONS.-Any
allocation among the States on the basis of income tax collections
shall be made by allocating to each State an amount which bears
the same ratio to the total amount to be allocated as the income tax
amount of such State bears to the sum of the income tax amounts
of all the States.
(5) ALLOCATION ON BASIS OF GENERAL TAX EFFORT.-Any allo-
cation among the States on the basis of general tax effort shall be
made by allocating to each State an amount which bears the same
ratio to the total amount to be allocated as the general tax effort
amount of such State bears to the sum of the general tax effort
amounts of all the States.
Subtitle B-Administrative Provisions
SEC. 121. REPORTS ON USE OF FUNDS; PUBLICATION.
[(a) REPORTS ON USE OF FUNDS.-Each State government and unit
of local government which receives funds under subtitle A shall, after
the close of each entitlement period, submit a report to the Secretary
setting forth the amounts and purposes for which funds received dur-
ing such period have been spent or obligated. Such reports shall be in
such form and detail and shall be submitted at such time as the
Secretary may prescribe.
[(b) REPORTS ON PLANNED USE OF FuNDs.-Each State government
and unit of local government which expects to receive funds under
subtitle A for any entitlement period beginning on or after January 1,
1973, shall submit a report to the Secretary setting forth the amounts
and purposes for which it plans to spend or obligate the funds which
it expects to receive during such period. Such reports shall be in such
form and detail as the Secretary may prescribe and shall be submitted
at such time before the beginning of the entitlement period as the
Secretary may prescribe.
[(c) PUBLICATION AND PUBLICITY OF REPORTS.-Each State govern-
ment and unit of local government shall have a copy of each report
submitted by it under subsection (a) or (b) published in a newspaper
which is published within the State and has general circulation within
the geographic area of that government. Each State government and
unit of local government shall advise the news media of the publica-
tion of its reports pursuant to this subsection.]
SEC. 121. REPORTS ON USE OF FUNDS; PUBLICATION AND PUBLIC
HEARINGS.
(a) REPORTS ON PROPOSED USE OF FUNDS.-Each State government
and urnit of local government which expects to receive funds under
subtitle A for any entitlement period beginning on or after January 1,
1977, shall submit a report to the Secretary setting forth the amounts
and purposes for which it proposes to spend or obligate the funds
which it expects to rcceii'e during such period as compared with the







u.we of similar funds during the two hn iiediately preced;/ng/ entitlement
periods. Each such report shall include a comparison of the proposed,
current, and past use of such funds to the relevant functional items in
its official budget and specify whether the proposed use is for a com-
pletely inew activity, for the expansion or contbi nationn of an ex;st;ig
activity, or for tax stabilization or reduction. Such report shall be in
such form and detail as the Secretary may piriscr'ibe and shall be sub-
mitted at such time before the beginn;rng of the entitlement period as
the Secretary may prescribe.
(b) REPORTS ON USE OF FUNDS.-Each State government and unit
of local government which receives funds under subtitle A shall, after
the close of each entitlement period, ..ubif a report to the Serretary
(which report shall be arcailable to the public for inspection and re-
production) setting forth the amounts and purpose's for which funds
received during such period have been appropriated, spent, or obli-
gated and showing the relationship of those funds to the relevant func-
tional items in the government's official budget. Such report shall fur-
ther provide an explanation of all differed nces between the actual use of
funds received and the proposed use of such funds as reported to the
Secretary under subsection (a). Such reports shall be in such form and
detail and shall be submitted at such tine as the Secretary may
prescribe.
(c) PUBLIC HEARINGS REQUIRED.-
(1) PRE-REPORT HEARING.-Not less than 7 calendar days be-
fore the submission of the report required under subsection (a),
each State government or unit of local government which expects
to receive funds under subtitle A for any entitlement period be-
ginning on or after January 1, 1977, shall, after adequate public
notice, have at least one public hearing at which citizens shall have
the opportunity to provide written and oral comment on the
possible uses of such funds.
(2) PRE-BUDGET HEARING.-Not less than 7 calendar days be-
fore the adoption of its budget as provided for under State and.
local law, each State government or unit of local government
which expects to receive funds under subtitle A for any entitle-
ment period beginning on or after January 1, 1977, shall have at
least one public hearing on the proposed use of funds made avail-
able under subtitle A in relation to its entire budget. At such hear-
ing, citizens shall have the opportunity to provide written and
oral comment to the body responsible for enacting the budget, and
to have answered questions concerning the entire budget and the
relation to it of funds made available under subtitle A. Such hear-
ing shall be at a place and time that permits and encourages
public attendance and participation.
(3) WAIVER.-The provisions of paragraph (1) may be waived
inwhole or in part in accordance with regulations of the Secretary
if the cost of such a requirem,?ent would be unreasonably burden-
some in relation to the entitlement of such State go'erninent or
unit of local government to funds made available ui nder subtitle A.
The provisions of paragraph (2) may be waived in whole or in
part in accordance with regulations of the Secretary if the budget
processes required under applicable State or local laws or charter
prcisions assure the opportunity for public attendance and par-






18


ticipation contemplated by the provisions of this subsection and a
portion of such process includes a hearing on the proposed use of
funds made available under subtitle A in relation to its entire
budget.
(d) NOTIFICATION AND PUBLICITY OF PUBLIC HEARINGS; ACCESS To
BUDGET SUMMARY AND PROPOSED AND ACTUAL USE REPORTS.-
(1) IN GENERAL.-Each State government and unit of local
government which expects to receive funds under subtitle A for
any entitlement period beginning on or after January 1, 1977,
shall-
(A) 30 days prior to the public hearing required by sub-
section (c) (2)-
(i) publish conspicuously, in at least one newspaper of
general circulation, the proposed use report required by
subsection (a) a narrative summary setting forth in
simple language an. explanation of its proposed official
budget, and a notice of the time and place of such public
hearing; and
(ii) make available for inspection and reproduction
by the public (at the prnincipal office of such State gov-
ernment or unit of local government, at public libraries,
if any, within, the boundaries of such a unit of local gor-
ernment, and, in the case of a State government, at the
main libraries of the principal municipalities of such
State) the proposed use report, the nar'raatiee summary,
and its official budget which shall specify writh. particu-
larity each item in its official budget which will be funded.
in whole or in part, with funds made available under
subtitle A and, for each such budget item, shall specify
the amount -of such funds budgeted for that item and the
pere.enta-ge of total expenditures for that item attribut-
able to such funds; and
(B) within 30 days after adoption of its budget as pro-
vided for under State or local law-
(i) publish conspiciously, in at lea.Qt one newspaper of
general irculat;on., a narrative swmmnaril setting forth in
simple language an explanation of its offrial budget (in-
rluding an explanation of changes from the proposed
budaeft) and the relationship of the use of funds m.ade
available under subtitle A to the relevant functional
items in such budget; and
(ii) make such summary available for inspection and
reproduction by the pvb7;c at the pri.rlipal office of such
State government or ?tnit of local aorcnment, at public
libraries, if any, qWithin the boundaries of such unit of
local government, and, in the ca.qe of a State qovernmenft,
at the main libraries of the principal municipalities of
such State.
(2) WArVER.-The povisions of paragraph (1) may be waived,
in whole or in part, with respect to pntb7;cat;on of the proposed
use reports and the narrative sum mares, in accordance with req-
wdations of the Secretary, where the cost of such publication woldd
be unreasonably burdensome in. relation to the entitlement of such







State gover-rnment or unit of local government to funds made
acaclable under subtitle .1, or where such publication is otherwise
practicall or infeasible. In addition. the 30-day provision of
paragraph (1) (A) may be modified to the i ;mmn exttfnt neces-
.'ary to comply with State and local law if the Secretary is satis-
fied that the cit;zei,; of the State or lotl1 government will receive
adequate notification of the proposed use of funds, consistent ?'6th
the intent of this section.
(e) REPORTS PROVIDED TO THE GovEP.voR.-A copy of each report
rcqi;r', d under subsections (a) and (b) filed with the Secref,/r./ by a-
Wu;t of local govrriment ,'hich r'e(;'cves funds under subtitle A shall
be provided by the Secr ctaly to the Go,'"( rior of the State in which the
uiit of local government is located, in such manner and form as the
Se.reftj'y may prt-.wribe by regulation.
(f) PLA.V.VED USE REPORT TO AREAWIDE ORGANIZATION.-At the
same time that the propos(,d use report is publ;.shed and publicized ;,
accordance with this section, each un)it of loral govn'n)ient which is
V,'ithin a metropolitan am,( shall submit a copy of the propo.wd use
r, port to the ar-eauwde organization in the metropolitan area 'which is
form ally charged with carrying out the provisions of section 204 of the
Demonstration Cities and Metropolitan Developmment Act of 1966 (422
U.S.C. 3334); section 401 of the Intergorrrnmental Cooperation Act
of 196G8 (? U.S.C. 4?31). or section 302 of the Housing and Com-
'muitoy Devdlopmnut Act of 1974 (42 U.S.C. 461).
[SEC. 122. NONDISCRIMINATION PROVISION.
[(a) Ix- GENERAL.--NO person in the United States shall on the
ground of race, color, national origin, or sex b)e excluded from partici-
pation in, be denied the benefits of, or be subjected to discrimination
under any program or activity funded in whole or in part with funds
made available under subtitle A.
[(b) AUTHORITY OF SECRETARY.-Whenever the Secretary deter-
mines that a State government or unit of local government has failed to
comply with subsection (a) or an applicable regulation, he shall notify
the Governor of the State (or, in the case of a unit of local government,
the Governor of the State in which such unit is located) of the non-
compliance and shall request the Governor to secure compliance. If
within a reasonable period of time the Governor fails or refuses to
secure compliance, the Secretary is authorized (1) to refer the matter
to the Attorney General with a recommendation that an appropriate
civil action be instituted; (2) to exercise the powers and functions
provided by title VI of the Civil Rights Act of 1964 (42 U.S.C.
2000d) ; or (3) to take such other action as may be provided by law.
[(c) AUlTlORITY OF ATTORNEY GENERAL.-When a matter is referred
to the Attorney General pursuant to subject ion (b), or whenever he has
reason to believe that a State government or unit of local government
is engaged in a pattern or practice in violation of the provisions of this
s(ct ion, the, Attorney General may bring a civil action in any appro-
priate. United States district court for such relief as may be appro-
priate, including injunctive relief.]
SEC. 122. NONDISCRIMINATION PROVISION.
(a) (1) IN GE.VERAL.-No person shall, on account of race. color.
religion, sex. national origin, age, or handicapped status, be e.Pclluded





20


from participation, in, be denied the benefits of, or be subjected to dis-
crinination under any program or activity .of/ a State government or
unit of local government, which government or unit receives funds
made available under subtitle A. The provisions of this paragraph
shall be interpreted-
(A) in accordance with titles II, III, IV, VI, and VII of the
Civil Rights Act of 1964, as amended, title VIII of the Civil
Rights Act of 1968, and title IX of the Education Amendments
of 1972, with respect to discrimination on the basis of race, color,
religion, sex, or national origin;
(B) in accordance 'with the Rehabilitation Act of 1973 with
respect to discrimination on the basis of handicapped status; and
(C) in accordance with the Age Discrimination Act of 1975
with respect to discrimination on the basis of age, notwithstanding
the deferred effectiveness of such Act.
(2) ExcEPTIONS.-
(A) FuNDINGva.-The provisions of paragraph (1) of this sub-
section shall not apply where any State government or unit of local
government proves by clear and convincing evidence that the
program. or activity with respect to which the allegation of dis-
craimination has been made is not funded in whole or in part,
directly or indirectly, with funds made available under subtitle A.
(B) CONSTRUCTION PROJECTS IN PROGRESS.-The provisions
of paragraph (1), relating to discrimination on the basis of handi-
capped status, shall not apply with respect to construction proj-
ects commenced prior to January 1, 1977.
(b) AUTHORITY OF THE SECRETARY.-
(1) NoTICE.-Whenever there has been-
(A) receipt of notice of a finding, after notice and oppor-
tunity for a hearing, by a Federal court (other than in a
proceeding brought by the Attor-ney General) or State court,
or by a Federal or State administrative agency (other than
the Secretary under subparagraph (B)), to the effect that
there has been a pattern or practice of' discrimination on the
basis of race, color, religion, sex, national origin, age, or
handicapped status in any program or activity of a State
government or unit of local government which government or
unit receives funds made available under subtitle A;
(B) a determination after an investigation by the Secre-
tary (prior to a hearing under paragraph (4) but including
an opportunity for the State government or. unit of local
government to make a documentary sub mission regarding
the allegation of discrimination or the funding of such pro-
gram or activity wiith funds made available under subtitle
(A) that a State government or unit of local government
is not in compliance with subsection (a) (1), the Secretary
shall, within 10 days of such occurrence, notify the Governor
of the affected State, or of the State in which an affected un it
of local government is located, and the chief executive officer
of such affected unit of local government, that such State
government or unit of local government is presumed not to
be in compliance with subsection (a) (1), and shall request





21


such Governor and such chief executive officer to secu,', com-
pliance. For purposes of subparagraph (A), a ftd;,g by a
Federal or State administrative agency shall be deemed ren-
dered after notice and opportunity for a hearing if it is
rendered pursuant to procedures consistent with the provi-
sions of subchapter II of chapter 5, title 5, United States Code.
(2) VOLUNTARY COMPLIANCE.-In the event the Go ver.nor or
the chief executive officer secures compliance after notice p;trsuant
to paragraph (1), the terms and conditions with which the af-
fected State government or unit of local qovernmor,,t agrees to
comply shall be set forth in writing and signed by the Go'c. ,,or,
by the chief executitve officer (in the event of a -iolation by a unit
of local government), and by the Secr',tary. On or prior to the
effective date of the agreement, the Secretary shall *. /l a copy
of the agreement to each complainant, if any, with re xpect to such
violation. The Governor, or the chief executive officer in the erent
of a violation by a unit of local government, shall file semiuanual
reports with the Secretary detailing the steps tafk' to comply
with the agreement. Within 15 days of receipt of suh reports the
Secretary shall send a copy thereof to each such cornp' .
(3) SUSPENSION AND RESUMPTION OF PAYMENT OF FUNDS.-
(A) SUSPENSIONA AFTER NOTICE.-If, at the conclision of
90 days after notification under paragraph (1) -
(i) compliance has not been secured by the Go,,ernor
of that State or the chief executive officer of that unit
of local government, and
(ii) an administrative law judge has not made a de-
termination under paragraph (4) (A) that it is likely the
State government or unit of local government t will p> ,.ail
on the merits,
the Secretary shall suspend further payment of any funds
under subtitle A to that State government or that unitf of local
government. Such suspension shall be effect ;,e for a prrwod
of not more than 120 days, or, if there is a hearing under
paragraph (4) (B), not more than 30 days after the conclusion
of such hearing, unless there has been an express finding by
the Secretary, after notice and opportunity for such a hea ring,
that the recipient is not in compliance with subsection (a) (1).
(B) RESUMPTION OF PAYMENTS SUSPENDED UNDER SUBPARA-
GRAPH (A).-Payment of the suspended funds shall resume
only if-
(i) such State government or unizt of local gov(rn-
ment enters into a compliance agreement approved by the
Secretary in accordance with paragraph (2) ;
(ii) such State government or tnit of local govr,2?n-
ment complies fully with the final order or judgment of a
Federal or State court, if that order or judgment covers
all the matters raised by the Secretary in the notice
pursuant to paragraph (1), or is found to be in compli-
ance with subsection (a) (1) by such court; or
(iii) after a hearing, the Secretary finds that non-
compliance has not been demonstrated. .






22
(C) SUSPENSION UPON ACTION BY ATTORNEY GENERAL.-
Whenever the Attorney General files a civil action alleging a
pattern or practice of discriminatory conduct on the basis of
race, color, religion, sewx, national origin, age, or handicapped
status ib any program or activity of a State government or
1t1t of local government which State government or unit of
local govern mne n t recei es funds made available under subtitle
A. cuad the conduct alleged violates the provisions of this
x ;cftioi. and neither party within 45 days after such. filing has
been granted such preliminary relief with regard to the sus-
peiuon or payment of funds as may be otherwise available by
law, the Secretary shall suspend further payment of any funds
under subtitle A to that State government or that unit of local
government until such time as the court orders resumption of
payment.
(4) HEARINGS; OTHER ACTIONS.-
(A) PRELIMINARY HEARINGS.-Prior to the suspension of
funds under paragraph (3), but within the 90-day period
after notification under paragraph (3) (A), the State gov-
eviwmment or unit of local government may request an expedited
prel Iniary hearing by an administrative law judge in or-der
to determine whether it is likely that the State government
or unit of local government would, at a full hearing under
subpar'agraph (B) of this paragraph, prevail on the merits
on the issue of the alleged noncompliance. A finding under
thi ;s subparagraph by the admi7nistratire law judge in favor
of the State government or unit of local government shall
defer the suspension of funds under paragraph (3) pending
a fidi*?g of noncompliance at the conclusion of the hearing
on the merits under subparagraph (B) of this paraqrapplh.
(B) COMPLIANCE HEARING.-At any time after notification
under paragraph (1) but before the conclusion of the 120-day
period referred to in paragraph (3), a State government or
Ilnit of local government may request a hearing, which the
Secretary shall initiate within 30 days of such request. Within
30 days after the conclusion of the hearing, or, in the absence
of a hearing, at the conclusion of the 120-day period referred
to in paragraph (3), the Secretary shall make a finding of
compliance or noncompliance. If the Secretary makes a find-
ing of noncomnpliance. the Secretary shall (i) notify the
Attorney General of the United States in order that the At-
torney General may institute a civil action under subsection
(c), (ii) term inmate the payment of funds under subtitle A,
and. (iii) if appropriate, seek repayment of such funds. If
the Secretary makes a finding.q of compliance, payment of the
suspended funds shall resume as provided in paragraph
(3)(B).
(5) JUDICIAL RFV1IEW.-Ant/? State government or unit of local
gorcrnment aggrieved by a final determination of the Secretary
under paragraph (4) may appeal such detemnkation as provided
1 A.qKrt'on. 143(c).
(e) A rTTJORITTY OF ATTORNEY GFNERAL.-Whenever the Attorney
General has rea.qon to believe that a State government or unit of local






23


government has engaged or is engaging in a pattern or practice in
violation of the provisions of this section, the Attorney Gc,,(,al may
bring a civil action in an appropriate United States district court. Such
court may grant as relief any temporary resti'aining order, prel;Vim-
nary or permanent injunction, or other order, as necees.,.iry or appro-
priate to insure the full enjoyment of the rights described in this
section, including the suspensionn, termination,, or rpaymct of f ulds
made available under this Act, or placing any further lwymiit, under
th;s title in escrow! pending the outcome of the litigation.
(d) AGREEMENTS BETWEE.. AGENCIEs.-The Secretary shall enter
into agreements with State agencies and er;th other F/, r.al agtfides
authorizing such agencies to investigate noncomplian., ,i-O'th subsec-
tion. (a). The agreements shall describe the cooiprti.ti' efforts to be
undertaken (including the sharKig of ci'il rights (iifoil( 1 0,t P,,o-
nel and resources) to secure compliance -irth this setf'o,;(. and shaTll
provide for the immediate notification of the Secr< fury by the At-
torney General of any actions inisthitted under subs',tion (f) o, i de
any other Federal ci l rights. statute or regulations ,.s.,-,/ th ereu(der.
SEC. 123. MISCELLANEOUS PROVISIONS.
(a) ASSURANCES TO THE SECRETARY.-IIn order to qualify for any
payment under subtitle A for any entitlement period beginning g on or
after Jamnuary 1, 1973, a State government or unit of local government
must establish (in accordance with regulations prescribed by the Sec-
retary, and, with respect to a unit of local government, after an
opportunity for review and comment by the Governor of the State in
which such unit is located) to the satisfaction of the Secretary that-
(1) it will establish a trust fund in which it will deposit all pay-
ments it receives under subtitle A;
(2) it will use amounts in such trust fund (including any
interest earned thereon while in such trust fund) during such rea-
sonable period or periods as may be provided in such regulations:
[(3) in the case of a unit of local government, it will use
amounts in such trust fund (including any interest earned thereon
while in such trust fund) only for priority expenditures (as de-
fined in section 103 (a)), and will pay over to the Secretary (for
deposit in the general fund of the Treasury) an amount equal to
110 percent of any amount expended out of such trust fund in
violation of this paragraph, unless such amount is promptly
repaid to such trust fund (or the violation is otherwise corrected)
after notice and opportunity for corrective action:]
(4) it will provide for the expenditure of amounts received
under subtitle A only in accordance with the laws and procedures
applicable to the expenditure of its own revenues:
(5) it will-
(A) use fiscal, accounting, and audit proce(dureo which con-
form to guidelines established therefore ] ;n, conformn';ty '';th
subsection (c) of this section, by the Secretary (after con-
sultation with the Comptroller General of the United States),
and conduct independe)ft fin(77c/(l aidalt.q ; a cordan,(e '*with
generally accepted audittibg standards as .cquO.,f-7 by para-
graph (2) of such subsection.
(B) provide to the Secretary (and to the Cbmpt roller Gen-
eral of the United States), on reasonable notice, ai-cess to. and






24
the right to examine, such books, documents, papers, or rec-
ords as the Secretary may reasonably require for purposes of
reviewing compliance with this title (or, in the case of the
Comptroller General, as the Comptroller General may reason-
ably require for purposes of reviewing compliance and oper-
ations under subsection (c) (2)), and :
(C) make such annual and interim reports (other than
reports required by section 121) to the Secretary as he may
reasonably require;
(6) all laborers and mechanics employed by contractors or sub-
contractors in the performance of work on any construction proj-
ect. 25 percent or more of the costs of which project are paid out
of its trust fund established under paragraph (1), will be paid
wages at rates not less than those prevailing on similar construc-
tion in the locality as determined by the Secretary of Labor in
a ccordance with the Davis-Bacon Act, as amended (40 U.S.C.
276a-276a-5), and that with respect to the labor standards speci-
fied in this paragraph the Secretary of Labor shall act in accord-
ance with Reorganization Plan Numbered 14 of 1950 (15 F.R.
3176; 64 Stat. 1267) and section 2 of the Act of June 13, 1934,
as amended (40 U.S.C. 276c);
(7) individuals employed by it whose wages are paid in whole
or in part out of its trust fund established under paragraph (1)
will be paid wages which are not lower than the prevailing rates
of pay for persons employed in similar public occupations by the
same employer; and
(8) in the case of a unit of local government as defined in the
second sentence of section 108 (d) (1) (relating to governments of
Indian tribes and Alaskan native villages), it will expend funds
received by it under subtitle A for the benefit of members of the
tribe or village residing in the county area from the allocation of
which funds are allocated to it under section 108 (b) (4).
Paragraph (7) shall apply with respect to employees in any category
only if 25 percent or more of the wages of all employees of the State
government or unit of local government in such category are paid
from the trust fund established by it under paragraph (1).
(b) WITHHOLDING OF PAYMENTS.-If the Secretary determines that
a State government or unit of local government has failed to comply
substantially with any provision of subsection (a) or any regulations
prescribed thereunder, after giving reasonable notice and opportunity
for a hearing to the Governor of the State or the chief executive officer
of the unit of local government, he shall notify the State government
or unit of local government that if it fails to take corrective action
within 60 days from the date of receipt of such notification further
payments to it will be withheld for the remainder of the entitlement
period and for any subsequent entitlement period until such time as
the Secretary is satisfied that appropriate corrective action has been
taken and that there will no longer be any failure to comply. Until he
is satisfied, the Secretary shall make no further payments of such
amounts.
[(c) ACCOUNTING, AUDITING, AND EVALUATION.-
[(1) IN GENER.AL.-The Secretary shall provide for such ac-
counting and auditing procedures, evaluations, and reviews as may






25


be necessary to insure that the expenditures of funds received
under subtitle A by State governments and units of local govern-
ment comply fully with the requirements of this title. The Secre-
tary is authorized to accept an audit by a State of such expendi-
tures of a State government or unit of local government if he
determines that such audit and the audit procedures of that
State are sufficiently reliable to enable him to carry out his duties
under this title.
[(2) COMPTROLLER GENERAL SHALL REVIEW COMrPLIANCE.-The
Comptroller General of the United States shall make such reviews
of the work as done by the Secretary, the State governments, and
the units of local government as may be necessary for the Con-
gress to evaluate compliance and operations under this title.]
(c) ACCOUNTING, AUDITING, AND EVALUATION.-
(1) IN GENERAL.-The Secretary shall provide for such audits,
evalu.ations a0id reviews as may be necessary to insure that the
expenditures of funds received under sitbtitle A or D by State gov-
ernmen ts and u ii ;s of local government comply fully with require-
ments of this title. Such audits, evaluations, and reviews shall in-
clude such independent audits as may be required pursuant to
paragraph (2). The Secretary is authorized to accept an audit by
a State govern iient or unit of local government of its expenditures
if he determine. that such audit was conducted in compliance
with paragraph (2), and that such audit and the audit procedures
of that State government or unit of local government are suffi-
ciently reliable to (cable him tio carry out his duties under this
title.
(2) INDEPENDENT AUDITS.-The Secretary shall, after consul-
tation with the ComWptroller General, promulgate regulations to
tae effect not later than March 31, 1977, which shall require that
nich State government and unit of local government receiving
funds under subtitle A or D conducts during each fiscal year an
ai(dit of its financial accounts in accordance with generally ac-
cepted auditing standards. Such regu nations shall include such
provisions as may be necessary to a.ssure independent audits are
conducted in accordance with such standards, but may provide
for lessr formal reviews of financial information, or less frequent
,-1udits, to the extent necessary to ensure that the cost of such audits
not be unreasonably burdensome in relation to the entitlement of
sach State government or unit of local government to funds avail-
able ,under subtitles A and D. Such regulations shall further pro-
vide for the availability to the public of financial statements and
reports on audits or informal re 'ews conducted under this para-
graph for inspection and reproduction as public documents.
(3) COMPTROLLER GENERAL SHALL REVIEW COMPLIANCE.-The
Comptroller General of the United States shall make such reviews
of the work as done by the Secretary. the State governments, and
the .,,dfs of loci'l government as may be necessary for the Congress
to evaluate compliance aind operations under this title.
(d) REPORT OF THIF SECRETARY OF THE TREASURY.-The Secretary
of the Treasury shall include with the report required under section
105 (a) (2) a report to the Congress on the implementation and admindnis-
tration of this Act during the preceding fiscal year. Such report shall






26


include, but not be limited to, a comprehensive and detailed analysis
of the following:
(1) the measures taken to comply with section 122, including a
description of the nature and extent of any noncompliance and
the status of all pending complaints;
S(2) the extent to which citizens in I'ecipient jurisdictions have
become involved ia the decis-ions detewmuinig the expenditure of
funds received under subtitle A;
(3) the extent to -which recipient hursdictions hare comnplied
u'ith section 123. including a description of the wnature and extent
of any noncompliance aid of measures taken. to ensure the inde-
pendewnce of audits conducted puisu.ant to s-ubsection (c) of such
section;
(4) the manner in u'hich funds distributed under subtitle A
hare been used, eluding the net fiscal impact, if any, in recipient
jurisdict on s ; and
(5) sign;flcant problems arising in the administration of the
Act and proposals to remedy such problems through, approplnate
legislation.
(e) PROHIBITIO.v OF USE FOR LOBBYING PURPOSES.-No State gov-
ernment or unit of local gove-rnment may use. directly or infldireetly.
any part of the funds it receives under subtitle A for the purpose of
lobbying or other activities intended to influence any legislation re-
gareding the provisions of this Act. For the purpose of this subsection,
dues paid to National or State a.sociations shall be deemed not to
have been paid from funds received ulnd(r subtitle A.
SEC. 124. COMPLAINTS AND COMPLIANCE REVIEWS.
By March 31, 1977, the Secretary shall promulgate regulations
establishing-
(1) reasonable and speci;fic time limitss for the Secretary or the
appropriate coopc rating agency to respond to the fling of a com-
plaint by any person alleging that a State gove-rnment or umit of
local government is in violation of the provisions of this Act, in-
eluding time limits for instituting an investigation. maA'ing an
appropriate determination ?'ith respect to the allegations, and ad-
V'sing the complainant of the status of the complaint; and
(2) reasonable and specific time limits for the Secretary to con-
duct audits and renes of State qoreronments and winfts of locel
government for compliance with the pro;sions of this A-t.
SEC. 125. PRIVATE CIVIL ACTIONS.
(a) STAND zG.-TVhen ever a State government or unit of local
government, or any officer or employee thereof acting in an official
capacity, has engaged or is engaging in any act or practice pinohibited
by this Act, upon exhaustion of adnini.tratire remedies., a reil action
may be in.st;tuted by the person aggricrved in an appropriate lUnited
States district court or in a State court of general jurisdiction.
(b) IRELIEF.-The court may grant as relief Po the plaintiff any
temporary rest wraning order. preliminary or permanent injunction or
other order, hwluding the suspension. termination. or re)pa.-ment of
.funds, or placing arqy further payments under this title in escrow
pend;nq the outcome of the litigation.
(c) INTRV.'NF.vRTION BY A-'TTORNEY GENERAL.-In any action instituted
under thi. section to enforce complianrr with section 122(a). the At-






27


torn)ey General, or a specially designated assistant for or in the name
of the United States, viay intfer'ene upon timely application if he
cei'fifles that the action is of g('neral public importance. In .v/ch action
the United States shall be entitled to the sme relief as if it had
instit'vf d the action.

Subtitle C-General Provisions
SEC. 141. DEFINITIONS AND SPECIAL RULES.
(a) SECRETAIRY.-For purposes of this title, the term "Secretary"
means the Secretary of the Treasury or his delegate. The term "Secre-
tary of the Treasury" mea:s the Secretary of the Treasury personally,
not including any delegate.
(b) ENTITLEMENT PERIOD.-For purposes of this title, the term
"entitlement period" means-
(1) The period beginning January 1, 1972, and ending June 30,
1972.
(2) The period beginning July 1. 1972, and ending December
31, 1972.
(3) The period beginning January 1, 1973, and ending June 30,
1973.
(4) The one-year periods beginning on July 1 of 1973, 1974, and
1975.
(5) The period beginning July 1, 1976, and ending December
31,1976.
(6) The pe'.riod beginning on January 1, 1977, and ending Sep-
tember 30, 1977.
(7) The one-year pi,;ods beg;nnii;g on October 1 of 1977, 1978.
and 1979.
(c) DISTRICT OF COLUMBIA.-
(1) TREATMkENT AS STATE AND LOCAL GOVERNMIENT.-For pur-
poses of this title, the District of Columbia shall be treated both-
(A) as a State (and any reference to the Governor of a
State shall, in the case of the District of Columbia, be treated
as a reference to the Commissioner of the District of Colum-
bia), and
(B) as a county area which has no units of local govern-
ment (other than itself) within its geographic area.
(2) RED-(UCTION IN CASE OF INCOME TAX ON NONRESIDENT INDIVID-
UALS.-If there is hereafter enacted a law imposing a tax on
income earned in the District of Columbia by individuals who are
not residents of the District of Columbia, then the entitlement of
the District of Columbia under subtitle A for any entitlement
period shall be reduced by an amount equal to the net collections
from such tax during such entitlement period attributable to
individuals who are not residents of the District of Columbia. The
preceding sentence shall not apply if-
(A) the District of Columbia and Maryland enter into an
agreement under which each State agrees to impose a tax
on income earned in that State by individuals who are resi-
dents of the other State, and the District of Columbia and






28


Virginia enter into an agreement under which each State
agrees to impose a tax on income earned in that State by
individuals who are residents of the other State, or
(B) the Congress enacts a law directly imposing a tax on
income earned in the District of Columbia by individuals who
are not residents of the District of Columbia.
SEC. 142. REGULATIONS.
(a) GENERAL RULE.-The Secretary shall prescribe such regulations
as may be necessary or appropriate to carry out the provisions of this
title.
(b) ADMINISTRATIVE PROCEDURE ACT To APPLY.-The rulemaking
provisions of subchapter II of chapter 5 of title 5 of the United States
Code shall apply to the regulations prescribed under this title for enti-
tlement periods beginning on or after January 1, 1973.
SEC. 143. JUDICIAL REVIEW.
(a) PETITIONS FOR REVIEW.-Any State which receives a notice of
reduction in entitlement under section 107(b), and any State or unit
of local government which receives a notice of withholding of pay-
ments under section [104(b) or] 123(b), may, within 60 days after
receiving such notice, file with the United States court of appeals for
the circuit in which such State or unit of local government is located
a petition for review of the action of the Secretary. A copy of the peti-
tion shall forthwith be transmitted to the Secretary; a copy shall also
forthwith be transmitted to the Attorney Genera].
(b) RECORD.-The Secretary shall file in the court the record of the
proceeding on which he based his action, as provided in section 2112
of title 28, United States Code. No objection to the action of the
Secretary shall be considered by the court unless such objection has
been urged before the Secretary.
(c) JURISDICTION OF COURT.-The court shall have jurisdiction to
affirm or modify the action of the Secretary or to set it aside in whole
or in part. The findings of fact by the Secretary, if supported by sub-
stantial evidence contained in the record, shall be conclusive. However,
if any finding is not supported by substantial evidence contained in
the record, the court may remand the case to the Secretary to take
further evidence, and the Secretary may thereupon make new or
modified findings of fact and may modify his previous actions. He
shall certify to the court the record of any further proceedings. Such
new or modified findings of fact shall likewise be conclusive if sup-
ported by substantial evidence contained in the record..
(d) REVIEW BY SUPREME COURT.-The judgment of the court shall
be subject to review by the Supreme Court of the United States upon
certiorari or certification, as provided in section 1254 of title 28,
United States Code.
SEC. 144. AUTHORITY TO REQUIRE INFORMATION ON INCOME TAX
RETURNS.
(a) GENERAL RULE.
(1) INFORMATION WITH RESPECT TO PLACE OF RESIDENCE.-Sub-
part B of part II of subchapter A of chapter 61 of the Internal
Revenue Code of 1954 (relating to income tax returns) is amended
by addingat the end thereof the following new section:






29


"SEC. 6017A. PLACE OF RESIDENCE.
"In the case of an individual, the information required on any
return with respect to the taxes imposed by chapter 1 for any period
shall include information as to the State, county, municipality, and
any other unit of local government in which the taxpayer (and any
other individual with respect to whom an exemption is claimed on such
return) resided on one or more dates (determined in the manner pro-
vided by regulations prescribed by the Secretary or his delegate)
during such period."
(2) CLERICAL AMENDMENT.-The table of sections for such
subpart B is amended by adding at the end thereof the following:
"Sec. 6017A. Place of residence."
(b) CIVIL PENALTY.-
(1) IN GENERAL.-Subchapter B of chapter 68 of the Internal
Revenue Code of 1954 is amended by adding at the end thereof
the following new section:
"SEC. 6687. FAILURE TO SUPPLY INFORMATION WITH RESPECT TO
PLACE OF RESIDENCE.
"(a) CIVIL PENALTY.-If any person fails to include on his return
any information required under Section 6017A with respect to his place
of residence, he shall pay a penalty of $5 for each such failure, unless
it is shown that such failure is due to reasonable cause.
"(b) DEFICIENCY PROCEDURES NOT To APPLY.-Subchapter B of
chapter 63 (relating to deficiency procedures for income, estate, gift,
and chapter 42 taxes) shall not apply in respect of the assessment or
collection of any penalty imposed by subsection (a) ."
(2) CLERICAL AMENDMENT.-The table of sections for such sub-
chapter B is amended by adding at the end thereof the following:
"Sec. 6687. Failure to supply information with respect to place of
residence."




UNIVERSITY OF FLORIDA
3 1262 09III113 0913
3 1262 09113 0913 |