§6907 State Legislation Requiring Reallocation or Redistribution of Payments to Smaller Units of General Purpose Government

Summary

A State may pass a law that requires money that would go to larger local governments to be split and sent instead to smaller local governments inside them. The smaller governments must be inside the larger unit, provide general local services, and include entitlement lands. The split should roughly match the level of services they give and the number of entitlement acres they have. When a State makes such a law, the federal Secretary will send one combined payment to the State equal to the total that would have gone to the local governments. The State must redistribute the money within 30 days and may not use any of those funds to pay for doing the redistribution. Money appropriated for payments in lieu of taxes for a fiscal year may be used to correct underpayments from the previous fiscal year so all qualified recipients are treated fairly.