20 USC 7702 - Payments relating to Federal acquisition of real property

U.S Code last checked for updates: Jan 18, 2025

§ 7702.

Payments relating to Federal acquisition of real property

(a)

In general

Where the Secretary, after consultation with any local educational agency and with the appropriate State educational agency, determines—

(1)

that the United States owns Federal property in the local educational agency, and that such property—

(A)

has been acquired by the United States since 1938;

(B)

was not acquired by exchange for other Federal property in the local educational agency which the United States owned before 1939; and

(C)

had an assessed value according to original records (including facsimiles or other reproductions of those records) documenting the assessed value of such property (determined as of the time or times when so acquired) prepared by the local officials referred to in subsection (b)(3) or, when such original records are not available due to unintentional destruction (such as natural disaster, fire, flooding, pest infestation, or deterioration due to age), other records, including Federal agency records, local historical records, or other records that the Secretary determines to be appropriate and reliable, aggregating 10 percent or more of the assessed value of—

(i)

all real property in the local educational agency (similarly determined as of the time or times when such Federal property was so acquired); or

(ii)

all real property in the local educational agency as assessed in the first year preceding or succeeding acquisition, whichever is greater, only if—

(I)

the assessment of all real property in the local educational agency is not made at the same time or times that such Federal property was so acquired and assessed; and

(II)

State law requires an assessment be made of property so acquired; and

(2)

that such agency is not being substantially compensated for the loss in revenue resulting from such ownership by increases in revenue accruing to the agency from the conduct of Federal activities with respect to such Federal property,

then such agency shall be eligible to receive the amount described in subsection (b) or (h).

(b)

Amount

(1)

In general

(A)

(i)

(I)

Subject to subclauses (II) and (III), the amount that a local educational agency shall be paid under subsection (a) for a fiscal year shall be calculated in accordance with paragraph (2).

(II)

Except as provided in subclause (III), the Secretary may not reduce the amount of a payment under this section to a local educational agency for a fiscal year by (aa) the amount equal to the amount of revenue, if any, the agency received during the previous fiscal year from activities conducted on Federal property eligible under this section and located in a school district served by the agency, including amounts received from any Federal department or agency (other than the Department of Education) from such activities, by reason of receipt of such revenue, or (bb) any other amount by reason of receipt of such revenue.

(III)

If the amount equal to the sum of (aa) the proposed payment under this section to a local educational agency for a fiscal year and (bb) the amount of revenue described in subclause (II)(aa) received by the agency during the previous fiscal year, exceeds the maximum amount the agency is eligible to receive under this section for the fiscal year involved, then the Secretary shall reduce the amount of the proposed payment under this section by an amount equal to such excess amount.

(ii)

For purposes of clause (i), the amount of revenue that a local educational agency receives during the previous fiscal year from activities conducted on Federal property shall not include payments received by the agency from the Secretary of Defense to support—

(I)

the operation of a domestic dependent elementary or secondary school; or

(II)

the provision of a free public education to dependents of members of the Armed Forces residing on or near a military installation.

(B)

If funds appropriated under section 7714(a) of this title are insufficient to pay the amount determined under subparagraph (A), the Secretary shall calculate the payment for each eligible local educational agency in accordance with subsection (h).

(C)

Notwithstanding any other provision of this subsection, a local educational agency may not be paid an amount under this section that, when added to the amount such agency receives under section 7703(b) of this title, exceeds the maximum amount that such agency is eligible to receive for such fiscal year under section 7703(b)(1)(C) of this title, or the maximum amount that such agency is eligible to receive for such fiscal year under this section, whichever is greater.

(2)

Application of current levied real property tax rate

(3)

Determination of taxable value for eligible Federal property

(A)

In general

In determining the estimated taxable value of such acquired Federal property for fiscal year 2010 and each succeeding fiscal year, the Secretary shall—

(i)

first determine the total taxable value for the purpose of levying property tax for school purposes for current expenditures of real property located within the boundaries of such local educational agency;

(ii)

then determine the per acre value of the eligible Federal property by dividing the total taxable value as determined in clause (i) by the difference between the total acres located within the boundaries of the local educational agency and the number of Federal acres eligible under this section; and

(iii)

then determine the total taxable value of the eligible Federal property by multiplying the per acre value as calculated under clause (ii) by the number of Federal acres eligible under this section.

(B)

Special rule

In the case of Federal property eligible under this section that is within the boundaries of 2 or more local educational agencies that are eligible under this section, any of such agencies may ask the Secretary to calculate (and the Secretary shall calculate) the taxable value of the eligible Federal property that is within its boundaries by—

(i)

first calculating the per-acre value of the eligible Federal property separately for each eligible local educational agency that shared the Federal property, as provided in subparagraph (A)(ii);

(ii)

then averaging the resulting per-acre values of the eligible Federal property from each eligible local educational agency that shares the Federal property; and

(iii)

then applying the average per-acre value to determine the total taxable value of the eligible Federal property under subparagraph (A)(iii) for the requesting local educational agency.

(c)

Applicability to Tennessee Valley Authority Act

(d)

Ownership by United States

The United States shall be deemed to own Federal property for the purposes of this chapter, where—

(1)

prior to the transfer of Federal property, the United States owned Federal property meeting the requirements of subparagraphs (A), (B), and (C) of subsection (a)(1); and

(2)

the United States transfers a portion of the property referred to in paragraph (1) to another nontaxable entity, and the United States—

(A)

restricts some or any construction on such property;

(B)

requires that the property be used in perpetuity for the public purposes for which the property was conveyed;

(C)

requires the grantee of the property to report to the Federal Government (or its agent) regarding information on the use of the property;

(D)

except with the approval of the Federal Government (or its agent), prohibits the sale, lease, assignment, or other disposal of the property unless such sale, lease, assignment, or other disposal is to another eligible government agency; and

(E)

reserves to the Federal Government a right of reversion at any time the Federal Government (or its agent) deems it necessary for the national defense.

(e)

Local educational agency containing Forest Service land and serving certain counties

Beginning with fiscal year 1995, a local educational agency shall be deemed to meet the requirements of subsection (a)(1)(C) if such local educational agency meets the following requirements:

(1)

Acreage and acquisition by the Forest Service

(2)

County charter

(f)

Special rule

(g)

Former districts

(1)

Consolidations

(2)

Eligible local educational agencies

A local educational agency referred to in paragraph (1) is—

(A)

any local educational agency that, for fiscal year 1994 or any preceding fiscal year, applied, and was determined to be eligible under, section 2(c) of the Act of September 30, 1950 (Public Law 874, 81st Congress) as that section was in effect for that fiscal year; or

(B)

a local educational agency—

(i)

that was formed by the consolidation of 2 or more districts, at least 1 of which was eligible for assistance under this section for the fiscal year preceding the year of the consolidation; and

(ii)

which includes the designation referred to in paragraph (1) in its application under section 7705 of this title for a fiscal year beginning on or after December 10, 2015, or any timely amendment to such application.

(3)

Amount

(h)

Payments with respect to fiscal years in which insufficient funds are appropriated

For any fiscal year for which the amount appropriated under section 7714(a) of this title is insufficient to pay to each eligible local educational agency the full amount determined under subsection (b), the Secretary shall make payments to each local educational agency under this section as follows:

(1)

Foundation payments for pre-2010 recipients

(A)

In general

(B)

Amount

(i)

In general

(ii)

Exception

(C)

Insufficient appropriations

(2)

Foundation payments for new applicants

(A)

First year

(B)

Second and succeeding years

(C)

Amounts

The amount of a payment under subparagraph (A) for a local educational agency shall be determined as follows:

(i)

Calculate the local educational agency’s maximum payment under subsection (b).

(ii)

Calculate the percentage that the amount appropriated under section 7714(a) of this title for the most recent fiscal year for which the Secretary has completed making payments under this section is of the total maximum payments for such fiscal year for all local educational agencies eligible for a payment under subsection (b) and multiply the agency’s maximum payment by such percentage.

(iii)

Multiply the amount determined under clause (ii) by 90 percent.

(D)

Insufficient funds

(3)

Remaining funds

(4)

Data

(i)

Special payments

(1)

In general

(2)

Local educational agency described

A local educational agency described in this paragraph is a local educational agency that—

(A)

received a payment under this section for fiscal year 1996;

(B)

serves a school district that contains all or a portion of a United States military academy;

(C)

serves a school district in which the local tax assessor has certified that at least 60 percent of the real property is federally owned; and

(D)

demonstrates to the satisfaction of the Secretary that such agency’s per-pupil revenue derived from local sources for current expenditures is not less than that revenue for the preceding fiscal year.

(j)

Prior year data

Notwithstanding any other provision of this section, in determining the eligibility of a local educational agency for a payment under subsection (b) or (h)(2) of this section for a fiscal year, and in calculating the amount of such payment, the Secretary—

(1)

shall use data from the prior fiscal year with respect to the Federal property involved, including data with respect to the assessed value of the property and the real property tax rate for current expenditures levied against or imputed to the property; and

(2)

shall use data from the second prior fiscal year with respect to determining the amount of revenue referred to in subsection (b)(1)(A)(i).

(k)

Loss of eligibility

(1)

In general

(2)

Local educational agency described

A local educational agency described in this paragraph is an agency that—

(A)

was eligible for, and received, a payment under this section for fiscal year 2002; and

(B)

beginning in fiscal year 2003 or a subsequent fiscal year, is no longer eligible for payments under this section as provided for in subsection (a)(1)(C) as a result of the transfer of the Federal property involved to a non-Federal entity.

(Pub. L. 89–10, title VII, § 7002, formerly title VIII, § 8002, as added Pub. L. 103–382, title I, § 101, Oct. 20, 1994, 108 Stat. 3749; amended Pub. L. 104–195, §§ 1, 6, Sept. 16, 1996, 110 Stat. 2379, 2382; Pub. L. 105–18, title VI, §§ 60004, 60006, June 12, 1997, 111 Stat. 214, 215; Pub. L. 105–78, title III, Nov. 13, 1997, 111 Stat. 1498; Pub. L. 105–277, div. A, § 101(f) [title III], Oct. 21, 1998, 112 Stat. 2681–337, 2681–365; Pub. L. 106–113, div. B, § 1000(a)(4) [title III], Nov. 29, 1999, 113 Stat. 1535, 1501A–247; Pub. L. 106–398, § 1 [[div. A], title XVIII, § 1803], Oct. 30, 2000, 114 Stat. 1654, 1654A–369; Pub. L. 107–110, title VIII, § 801(a)–(e), Jan. 8, 2002, 115 Stat. 1947, 1948; Pub. L. 108–447, div. F, title III, § 305, Dec. 8, 2004, 118 Stat. 3151; Pub. L. 112–239, div. A, title V, § 563(b)(1), (c)(4), Jan. 2, 2013, 126 Stat. 1744, 1748; renumbered title VII, § 7002, and amended Pub. L. 114–95, title VII, §§ 7001(a)(1), (c)(1), (d)(6), (9), 7003, Dec. 10, 2015, 129 Stat. 2074, 2075.)

cite as: 20 USC 7702