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``SEC. 6102. ALLOCATION TO LOCAL EDUCATIONAL AGENCIES.
- ``(a) Distribution Rule.--From the sums made available each year to carry out this title, the State educational agency shall distribute not less than 85 percent to local educational agencies within such State according to the relative enrollments in public and private, nonprofit schools within the school districts of such agencies, adjusted, in accordance with criteria approved by the Secretary, to provide higher per pupil allocations to local educational agencies which have the greatest numbers or percentages of children whose education imposes a higher than average cost per child, such as--
- ``(1) children living in areas with high concentrations of low-income families;
- ``(2) children from low-income families; and
- ``(3) children living in sparsely populated areas.
- ``(b) Calculation of Enrollments.--
- ``(1) In general.--The calculation of relative enrollments under subsection (a) shall be on the basis of the total of--
- ``(A) the number of children enrolled in public schools; and
- ``(B) the number of children enrolled in private nonprofit schools that desire that their children participate in programs or projects assisted under this title, for the fiscal year preceding the fiscal year for which the determination is made.
- ``(2) Construction.--Nothing in this subsection shall diminish the responsibility of local educational agencies to contact, on an annual basis, appropriate officials from private nonprofit schools within the areas served by such agencies in order to determine whether such schools desire that their children participate in programs assisted under this part.
- ``(3) Adjustments.--
- ``(A) Relative enrollments under subsection (a) shall be adjusted, in accordance with criteria approved by the Secretary under subparagraph (B), to provide higher per pupil allocations only to local educational agencies which serve the greatest numbers or percentages of--
- ``(i) children living in areas with high concentrations of low-income families;
- ``(ii) children from low-income families; or
- ``(iii) children living in sparsely populated areas.
- ``(B) The Secretary shall review criteria submitted by a State educational agency for adjusting allocations under paragraph (1) and shall approve such criteria only if the Secretary determines that such criteria are reasonably calculated to produce an adjusted allocation that reflects the relative needs within the State's local educational agencies based on the factors set forth in subparagraph (A).
- ``(c) Payment of Allocations.--
- ``(1) Distribution.--From the funds paid to a State educational agency pursuant to section 6002 for a fiscal year, a State educational agency shall distribute to each eligible local educational agency which has submitted an application as required in section 6202 the amount of such local educational agency allocation as determined under subsection (a).
- ``(2) Additional funds.--
- ``(A) Additional funds resulting from higher per pupil allocations provided to a local educational agency on the basis of adjusted enrollments of children described in subsection (a), may, at the discretion of the local educational agency, be allocated for expenditures to provide services for children enrolled in public and private nonprofit schools in direct proportion to the number of children described in subsection (a) and enrolled in such schools within the local educational agency.
- ``(B) In any fiscal year, any local educational agency that elects to allocate such additional funds in the manner described in subparagraph (A) shall allocate all additional funds to schools within the local educational agency in such manner.
- ``(C) The provisions of subparagraphs (A) and (B) may not be construed to require any school to limit the use of such additional funds to the provision of services to specific students or categories of students.