text: SECTION 1. ALLOCATION OF NATIONAL LIMITATION ON QUALIFIED SCHOOL 
                CONSTRUCTION BONDS; APPLICATION OF DAVIS-BACON ACT TO 
                PROJECTS FINANCED WITH BONDS.
  
      (a) In General.--Title XII of the Elementary and Secondary 
  Education Act of 1965 (20 U.S.C. 8501 et seq.) is amended--
              (1) by redesignating sections 12004 through 12013 as 
          sections 12101 through 12110, respectively;
              (2) by inserting before section 12101 (as so redesignated) 
          the following:
  
    ``PART A--GRANTS FOR IMPROVEMENT OF PUBLIC ELEMENTARY AND SECONDARY 
                          EDUCATION FACILITIES'';
  
          and
              (3) by adding at the end the following:
  
               ``PART B--QUALIFIED SCHOOL CONSTRUCTION BONDS
  
  ``SEC. 12201. ALLOCATION WITH RESPECT TO QUALIFIED SCHOOL CONSTRUCTION 
                BONDS.
  
      ``(a) Qualified School Construction Bond.--
              ``(1) In general.--For purposes of this part, the term 
          `qualified school construction bond' means any bond issued as 
          part of an issue if--
                      ``(A) a taxpayer who holds the bond is allowed a 
                  credit under the Internal Revenue Code of 1986;
                      ``(B) 95 percent or more of the proceeds of such 
                  issue are to be used for the construction, 
                  rehabilitation, or repair of a public school facility;
                      ``(C) the bond is issued by a State or local 
                  government within the jurisdiction of which such school 
                  is located; and
                      ``(D) the issuer designates such bond for purposes 
                  of this section and the Internal Revenue Code of 1986.
              ``(2) Temporary period exception.--A bond shall not be 
          treated as failing to meet the requirement of paragraph (1)(B) 
          solely by reason of the fact that the proceeds of the issue of 
          which such bond is a part are invested for a reasonable 
          temporary period (but not more than 36 months) until such 
          proceeds are needed for the purpose for which such issue was 
          issued. Any earnings on such proceeds during such period shall 
          be treated as proceeds of the issue for purposes of applying 
          paragraph (1)(B).
      ``(b) National Limitation on Amount of Bonds Designated.--In any 
  case in which there is imposed a national limitation on the maximum 
  aggregate face amount of bonds issued during any calendar year which 
  may be designated as qualified school construction bonds, such 
  limitation shall be allocated in accordance with this section.
      ``(c) One-Third of Limitation Allocated Among States.--
              ``(1) In general.--One-third of the limitation applicable 
          under subsection (b) for any calendar year shall be allocated 
          among the States under paragraph (2) by the Secretary. The 
          limitation amount allocated to a State under the preceding 
          sentence shall be allocated by the State educational agency to 
          issuers within such State and such allocations may be made only 
          if there is an approved State application.
              ``(2) Allocation formula.--The amount to be allocated under 
          paragraph (1) for any calendar year shall be allocated among 
          the States in proportion to the respective amounts each such 
          State received for Basic Grants under subpart 2 of part A of 
          title I of this Act for the most recent fiscal year ending 
          before such calendar year. For purposes of the preceding 
          sentence, Basic Grants attributable to large local educational 
          agencies (as defined in subsection (d)), and Basic Grants 
          attributable to high-growth local educational agencies (as 
          defined in subsection (e)), shall be disregarded.
              ``(3) Minimum allocations to states.--
                      ``(A) In general.--The Secretary shall adjust the 
                  allocations under this subsection for any calendar year 
                  for each State to the extent necessary to ensure that 
                  the sum of--
                              ``(i) the amount allocated to such State 
                          under this subsection for such year; and
                              ``(ii) the aggregate amounts allocated 
                          under subsections (d) and (e) to local 
                          educational agencies in such State for such 
                          year;
                  is not less than an amount equal to such State's 
                  minimum percentage of one-third of the national 
                  qualified school construction bond limitation referred 
                  to in subsection (b) for the calendar year.
                      ``(B) Minimum percentage.--A State's minimum 
                  percentage for any calendar year is the minimum 
                  percentage described in section 1124(d) for such State 
                  for the most recent fiscal year ending before such 
                  calendar year.
              ``(4) Allocations to certain possessions.--The amount to be 
          allocated under paragraph (1) to any possession of the United 
          States (as such term is used in the Internal Revenue Code of 
          1986) other than Puerto Rico shall be the amount which would 
          have been allocated if all allocations under paragraph (1) were 
          made on the basis of respective populations of individuals 
          below the poverty line (as defined by the Office of Management 
          and Budget). In making other allocations, the amount to be 
          allocated under paragraph (1) shall be reduced by the aggregate 
          amount allocated under this paragraph to possessions of the 
          United States.
              ``(5) Approved state application.--For purposes of 
          paragraph (1), the term `approved State application' means an 
          application which is approved by the Secretary and which 
          includes--
                      ``(A) the results of a recent publicly available 
                  survey (undertaken by the State with the involvement of 
                  local education officials, members of the public, and 
                  experts in school construction and management) of such 
                  State's needs for public school facilities, including 
                  descriptions of--
                              ``(i) health and safety problems at such 
                          facilities;
                              ``(ii) the capacity of public schools in 
                          the State to house projected enrollments; and
                              ``(iii) the extent to which the public 
                          schools in the State offer the physical 
                          infrastructure needed to provide a high-quality 
                          education to all students; and
                      ``(B) a description of how the State will allocate 
                  to local educational agencies, or otherwise use, its 
                  allocation under this subsection to address the needs 
                  identified under subparagraph (A), including a 
                  description of how it will--
                              ``(i) give highest priority to localities 
                          with the greatest needs, as demonstrated by 
                          inadequate school facilities coupled with a low 
                          level of resources to meet those needs;
                              ``(ii) use its allocation under this 
                          subsection to assist localities that lack the 
                          fiscal capacity to issue bonds on their own; 
                          and
                              ``(iii) ensure that its allocation under 
                          this subsection is used only to supplement, and 
                          not supplant, the amount of school 
                          construction, rehabilitation, and repair in the 
                          State that would have occurred in the absence 
                          of such allocation.
          Any allocation under paragraph (1) by a State education agency 
          shall be binding if such agency reasonably determined that the 
          allocation was in accordance with the plan approved under this 
          paragraph.
      ``(d) One-Third of Limitation Allocated Among Largest School 
  Districts.--
              ``(1) In general.--One-third of the limitation applicable 
          under subsection (b) for any calendar year shall be allocated 
          under paragraph (2) by the Secretary among local educational 
          agencies which are large local educational agencies for such 
          year. No qualified school construction bond may be issued by 
          reason of an allocation to a large local educational agency 
          under the preceding sentence unless such agency has an approved 
          local application.
              ``(2) Allocation formula.--The amount to be allocated under 
          paragraph (1) for any calendar year shall be allocated among 
  large local educational agencies in proportion to the respective 
  amounts each such agency received for Basic Grants under subpart 2 of 
  part A of title I of this Act for the most recent fiscal year ending 
  before such calendar year.
              ``(3) Large local educational agency.--For purposes of this 
          section, the term `large local educational agency' means, with 
          respect to a calendar year, any local educational agency (other 
          than a high-growth local educational agency, as defined in 
          subsection (e)) if such agency is--
                      ``(A) among the 100 local educational agencies with 
                  the largest numbers of children aged 5 through 17 from 
                  families living below the poverty level, as determined 
                  by the Secretary using the most recent data available 
                  from the Department of Commerce that are satisfactory 
                  to the Secretary; or
                      ``(B) 1 of not more than 25 local educational 
                  agencies (other than those described in clause (i)) 
                  that the Secretary determines (based on the most recent 
                  data available satisfactory to the Secretary) are in 
                  particular need of assistance, based on a low level of 
                  resources for school construction, a high level of 
                  enrollment growth, or such other factors as the 
                  Secretary deems appropriate.
              ``(4) Approved local application.--For purposes of 
          paragraph (1), the term `approved local application' means an 
          application which is approved by the Secretary and which 
          includes--
                      ``(A) the results of a recent publicly-available 
                  survey (undertaken by the local educational agency with 
                  the involvement of school officials, members of the 
                  public, and experts in school construction and 
                  management) of such agency's needs for public school 
                  facilities, including descriptions of--
                              ``(i) the overall condition of the local 
                          educational agency's school facilities, 
                          including health and safety problems;
                              ``(ii) the capacity of the agency's schools 
                          to house projected enrollments; and
                              ``(iii) the extent to which the agency's 
                          schools offer the physical infrastructure 
                          needed to provide a high-quality education to 
                          all students;
                      ``(B) a description of how the local educational 
                  agency will use its allocation under this subsection to 
                  address the needs identified under subparagraph (A); 
                  and
                      ``(C) a description of how the local educational 
                  agency will ensure that its allocation under this 
                  subsection is used only to supplement, and not 
                  supplant, the amount of school construction, 
                  rehabilitation, or repair in the locality that would 
                  have occurred in the absence of such allocation.
          A rule similar to the rule of the last sentence of subsection 
          (c)(5) shall apply for purposes of this subsection.
      ``(e) One-Third of Limitation Allocated Among High-Growth School 
  Districts.--
              ``(1) In general.--One-third of the limitation applicable 
          under subsection (b) for any calendar year shall be allocated 
          under paragraph (2) by the Secretary among local educational 
          agencies which are high-growth local educational agencies for 
          such year. No qualified school construction bond may be issued 
          by reason of an allocation to a high-growth local educational 
          agency under the preceding sentence unless such agency has an 
          approved local application (as defined in subsection (d)(4)). A 
          rule similar to the rule of the last sentence of subsection 
          (c)(5) shall apply for purposes of this subsection.
              ``(2) Allocation formula.--The amount to be allocated under 
          paragraph (1) for any calendar year shall be allocated among 
          high-growth local educational agencies in proportion to the 
          respective amounts each such agency received for Basic Grants 
          under subpart 2 of part A of title I of this Act for the most 
          recent fiscal year ending before such calendar year.
              ``(3) High-growth local educational agency.--For purposes 
          of this section, the term `high-growth local educational 
          agency' means, with respect to a calendar year, any local 
          educational agency if--
                      ``(A) there has been at least a 7.5 percent 
                  increase in such agency's enrollment during the 5-year 
                  period ending with the preceding calendar year; and
                      ``(B) such enrollment increase exceeds 150 
                  students.
      ``(f) Carryover of Unused Limitation.--If for any calendar year--
              ``(1) the amount allocated under subsection (c) to any 
          State; exceeds
              ``(2) the amount of bonds issued during such year which are 
          designated as qualified school construction bonds pursuant to 
          such allocation;
  the limitation amount under such subsection for such State for the 
  following calendar year shall be increased by the amount of such 
  excess. A similar rule shall apply to the amounts allocated under 
  subsections (d) and (e).
      ``(g) Other Definitions.--For purposes of this section:
              ``(1) Local educational agency.--The term `local 
          educational agency' has the meaning given to such term by 
          section 14101. Such term includes the local educational agency 
          that serves the District of Columbia but does not include any 
          other State agency.
              ``(2) Bond.--The term `bond' includes any obligation.
              ``(3) Public school facility.--The term `public school 
          facility' shall not include any stadium or other facility 
          primarily used for athletic contests or exhibitions or other 
          events for which admission is charged to the general public.
  
  ``SEC. 12202. APPLICATION OF DAVIS-BACON ACT TO PROJECTS FINANCED WITH 
                QUALIFIED SCHOOL CONSTRUCTION BONDS.
  
      ``The wage requirements of the Act of March 3, 1931 (40 U.S.C. 276a 
  et seq.) (commonly referred to as the `Davis-Bacon Act') shall apply 
  with respect to individuals employed on school construction, 
  rehabilitation, or repair projects financed with the proceeds from an 
  issuance of qualified school construction bonds.''.
      (b) Conforming Amendments.--Title XII of such Act is amended--
              (1) in sections 12101 through 12110 (as so redesignated), 
          by striking ``this title'' each place it appears and inserting 
          ``this part'';
              (2) in section 12101(a)(1) (as so redesignated)--
                      (A) by striking ``section 12013'' and inserting 
                  ``section 12110'';
                      (B) by striking ``section 12005'' and inserting 
                  ``section 12102''; and
                      (C) by striking ``section 12007'' and inserting 
                  ``section 12104'';
              (3) in section 12101(a)(2) (as so redesignated), by 
          striking ``section 12013'' and inserting ``section 12110''; and
              (4) in section 12109(3)(C) (as so redesignated), by 
          striking ``section 12006'' and inserting ``section 12103''.
target: Amends the Elementary and Secondary Education Act of 1965 to provide for the allocation of any limitation imposed on school construction bonds with respect to which the holders are allowed a credit under the Internal Revenue Code. 
  Applies the wage requirements of the Davis-Bacon Act to projects financed with such bonds.
feat_title: To amend the Elementary and Secondary Education Act of 1965 to provide for the allocation of any limitation imposed on school construction bonds with respect to which the holders are allowed a credit under the Internal Revenue Code of 1986, and to apply the wage requirements of the Davis-Bacon Act to projects financed with such bonds.