§ 5702. Federal funds allocated to States

Footnotes

1. 1 So in original. Two subpars. (C) have been enacted.

Legislative history

Reconstructed from this section’s Code source credit and amendment notes, resolved against the local Statutes at Large. Editorial notes are evidence, not the law that made the change.

1. 2010

   State Small Business Credit Initiative Act of 2010

   Pub. L. 111–240 title III § 3003 · 124 Stat. 2504

   Enacted · 12 U.S.C. § 5702

   Pub. L. 111–240, title III, § 3003, Sept. 27, 2010, 124 Stat. 2570

   Source evidence

   Code source credit
   Pub. L. 111–240, title III, § 3003, Sept. 27, 2010, 124 Stat. 2570

   Enacted provision · exact public law section
   SEC. 3003. FEDERAL FUNDS ALLOCATED TO STATES. (a) Program Established; Purpose.— There is established the State Small Business Credit Initiative, to be administered by the Secretary. Under the Program, the Secretary shall allocate Federal funds to participating States and make the allocated funds available to the participating States as provided in this section for the uses described in this section. (b) Allocation Formula.— (1) In general.— Not later than 30 days after the date of enactment of this Act, the Secretary shall allocate Federal funds to participating States so that each State is eligible to receive an amount equal to the average of the respective amounts that the State— (A) would receive under the 2009 allocation, as determined under paragraph (2); and (B) would receive under the 2010 allocation, as determined under paragraph (3). (2) 2009 allocation formula.— (A) In general.— The Secretary shall determine the 2009 allocation by allocating Federal funds among the States in the proportion that each such State’s 2008 State employment decline bears to the aggregate of the 2008 State employment declines for all States. (B) Minimum allocation.— The Secretary shall adjust the allocations under subparagraph (A) for each State to the extent necessary to ensure that no State receives less than 0.9 percent of the Federal funds. (C) 2008 state employment decline defined.— In this paragraph and with respect to a State, the term “2008 State employment decline” means the excess (if any) of— (i) the number of individuals employed in such State determined for December 2007; over (ii) the number of individuals employed in such State determined for December 2008. (3) 2010 allocation formula.— (A) In general.— The Secretary shall determine the 2010 allocation by allocating Federal funds among the States in the proportion that each such State’s 2009 unemployment number bears to the aggregate of the 2009 unemployment numbers for all of the States. (B) Minimum allocation.— The Secretary shall adjust the allocations under subparagraph (A) for each State to the extent necessary to ensure that no State receives less than 0.9 percent of the Federal funds. (C) 2009 unemployment number defined.— In this paragraph and with respect to a State, the term “2009 unemployment number” means the number of individuals within such State who were determined to be unemployed by the Bureau of Labor Statistics for December 2009. (c) Availability of Allocated Amount.— The amount allocated by the Secretary to each participating State under subsection (b) shall be made available to the State as follows: (1) Allocated amount generally to be available to state in one-thirds.— (A) In general.— The Secretary shall— (i) apportion the participating State’s allocated amount into thirds; (ii) transfer to the participating State the first ⅓ when the Secretary approves the State for participation under section 3004; and (iii) transfer to the participating State each successive ⅓ when the State has certified to the Secretary that it has expended, transferred, or obligated 80 percent of the last transferred ⅓ for Federal contributions to, or for the account of, State programs. (B) Authority to withhold pending audit.— The Secretary may withhold the transfer of any successive ⅓ pending results of a financial audit. (C) Inspector general audits.— (i) In general.— The Inspector General of the Department of the Treasury shall carry out an audit of the participating State’s use of allocated Federal funds transferred to the State. (ii) Recoupment of misused transferred funds required.— The allocation agreement between the Secretary and the participating State shall provide that the Secretary shall recoup any allocated Federal funds transferred to the participating State if the results of the an audit include a finding that there was an intentional or reckless misuse of transferred funds by the State. (iii) Penalty for misstatement.— Any participating State that is found to have intentionally misstated any report issued to the Secretary under the Program shall be ineligible to receive any additional funds under the Program. Funds that had been allocated or that would otherwise have been allocated to such participating State shall be paid into the general fund of the Treasury for reduction of the public debt. (iv) Municipalities.— In this subparagraph, the term “participating State” shall include a municipality given special permission to participate in the Program, under section 3004(d). (D) Exception.— The Secretary may, in the Secretary’s discretion, transfer the full amount of the participating State’s allocated amount to the State in a single transfer if the participating State applies to the Secretary for approval to use the full amount of the allocation as collateral for a qualifying loan or swap funding facility. (2) Transferred amounts.— Each amount transferred to a participating State under this section shall remain available to the State until used by the State as permitted under paragraph (3). (3) Use of transferred funds.— Each participating State may use funds transferred to it under this section only— (A) for making Federal contributions to, or for the account of, an approved State program; (B) as collateral for a qualifying loan or swap funding facility; (C) in the case of the first ⅓ transferred, for paying administrative costs incurred by the State in implementing an approved State program in an amount not to exceed 5 percent of that first ⅓; or (D) in the case of each successive ⅓ transferred, for paying administrative costs incurred by the State in implementing an approved State program in an amount not to exceed 3 percent of that successive ⅓. (4) Termination of availability of amounts not transferred within 2 years of participation.— Any portion of a participating State’s allocated amount that has not been transferred to the State under this section by the end of the 2-year period beginning on the date that the Secretary approves the State for participation may be deemed by the Secretary to be no longer allocated to the State and no longer available to the State and shall be returned to the General Fund of the Treasury. (5) Transferred amounts not assistance.— The amounts transferred to a participating State under this section shall not be considered assistance for purposes of subtitle V of title 31, United States Code. (6) Definitions.— In this section— (A) the term “allocated amount” means the total amount of Federal funds allocated by the Secretary under subsection (b) to the participating State; and (B) the term “⅓” means— (i) in the case of the first ⅓ and second ⅓, an amount equal to 33 percent of a participating State’s allocated amount; and (ii) in the case of the last ⅓, an amount equal to 34 percent of a participating State’s allocated amount.

2. 2021

   American Rescue Plan Act of 2021

   Pub. L. 117–2 § 3301(a)(1)(A)(i)(I) · 135 Stat. 4

   Amended · 12 U.S.C. § 5702(b)(1)

   Pub. L. 117–2, § 3301(a)(1)(A)(i)(I), amended par. (1) generally. Prior to amendment, par. (1) required allocation of funds by 30 days after Sept. 27, 2010

   Source evidence

   Code amendment note
   Subsec. (b)(1). Pub. L. 117–2, § 3301(a)(1)(A)(i)(I), amended par. (1) generally. Prior to amendment, par. (1) required allocation of funds by 30 days after Sept. 27, 2010.

   Enacted provision · exact public law section
   (I) by amending paragraph (1) to read as follows: “(1) In general.— Not later than 30 days after the date of enactment of subsection (d), the Secretary shall allocate Federal funds to participating States so that each State is eligible to receive an amount equal to what the State would receive under the 2021 allocation, as determined under paragraph (2).” ;

   Effective date note
   Amendment by Pub. L. 117–2 applicable with respect to funds appropriated under section 3301 of Pub. L. 117–2 and funds appropriated on and after Mar. 11, 2021, see section 3301(g) of Pub. L. 117–2, set out as a note under section 5701 of this title.

3. 2021

   American Rescue Plan Act of 2021

   Pub. L. 117–2 § 3301(a)(1)(A)(ii)(II)(bb) · 135 Stat. 4

   Substituted · 12 U.S.C. § 5702(b)(2)

   Pub. L. 117–2, § 3301(a)(1)(A)(ii)(II)(bb), substituted “2020” for “2008” wherever appearing

   Source evidence

   Code amendment note
   Subsec. (b)(2). Pub. L. 117–2, § 3301(a)(1)(A)(ii)(II)(bb), substituted “2020” for “2008” wherever appearing.

   Enacted provision · exact public law section
   (II) by amending paragraph (4) to read as follows: “(4) Termination of availability of amounts not transferred.— “(A) In general.— Any portion of a participating State’s allocated amount that has not been transferred to the State under this section may be deemed by the Secretary to be no longer allocated to the State and no longer available to the State and shall be returned to the general fund of the Treasury or reallocated as described under subparagraph (B), if— “(i) the second ⅓ of a State’s allocated amount has not been transferred to the State before the end of the end of the 3-year period beginning on the date that the Secretary approves the State for participation; or “(ii) the last ⅓ of a State’s allocated amount has not been transferred to the State before the end of the end of the 6-year period beginning on the date that the Secretary approves the State for participation. “(B) Reallocation.— Any amount deemed by the Secretary to be no longer allocated to a State and no longer available to such State under subparagraph (A) may be reallocated by the Secretary to other participating States. In making such a reallocation, the Secretary shall not take into account the minimum allocation requirements under subsection (b)(2)(B) or the specific allocation for Tribal governments described under subsection (b)(2)(C).” ;

   Effective date note
   Amendment by Pub. L. 117–2 applicable with respect to funds appropriated under section 3301 of Pub. L. 117–2 and funds appropriated on and after Mar. 11, 2021, see section 3301(g) of Pub. L. 117–2, set out as a note under section 5701 of this title.

4. 2021

   American Rescue Plan Act of 2021

   Pub. L. 117–2 § 3301(a)(1)(A)(i)(II)(aa) · 135 Stat. 4

   Substituted · 12 U.S.C. § 5702(b)(2)

   Pub. L. 117–2, § 3301(a)(1)(A)(i)(II)(aa), substituted “2021” for “2009” in heading and in subpar. (A)

   Target inherited from the preceding amendment note.

   Source evidence

   Code amendment note
   Pub. L. 117–2, § 3301(a)(1)(A)(i)(II)(aa), substituted “2021” for “2009” in heading and in subpar. (A).

   Enacted provision · exact public law section
   (aa) by striking “2009” each place such term appears and inserting “2021”;

   Effective date note
   Amendment by Pub. L. 117–2 applicable with respect to funds appropriated under section 3301 of Pub. L. 117–2 and funds appropriated on and after Mar. 11, 2021, see section 3301(g) of Pub. L. 117–2, set out as a note under section 5701 of this title.

5. 2021

   American Rescue Plan Act of 2021

   Pub. L. 117–2 § 3301(a)(1)(A)(i)(II)(cc) · 135 Stat. 4

   Substituted · 12 U.S.C. § 5702(b)(2)(A)

   Pub. L. 117–2, § 3301(a)(1)(A)(i)(II)(cc), substituted “With respect to States other than Tribal governments, the Secretary” for “The Secretary”

   Source evidence

   Code amendment note
   Subsec. (b)(2)(A). Pub. L. 117–2, § 3301(a)(1)(A)(i)(II)(cc), substituted “With respect to States other than Tribal governments, the Secretary” for “The Secretary”.

   Enacted provision · exact public law section
   (cc) in subparagraph (A), by striking “The Secretary” and inserting “With respect to States other than Tribal governments, the Secretary”;

   Effective date note
   Amendment by Pub. L. 117–2 applicable with respect to funds appropriated under section 3301 of Pub. L. 117–2 and funds appropriated on and after Mar. 11, 2021, see section 3301(g) of Pub. L. 117–2, set out as a note under section 5701 of this title.

6. 2021

   American Rescue Plan Act of 2021

   Pub. L. 117–2 § 3301(a)(1)(A)(i)(II)(ee) · 135 Stat. 4

   Added · 12 U.S.C. § 5702(b)(2)(C)

   Pub. L. 117–2, § 3301(a)(1)(A)(i)(II)(ee), added subpar. (C) relating to separate allocation for tribal governments

   Source evidence

   Code amendment note
   Subsec. (b)(2)(C). Pub. L. 117–2, § 3301(a)(1)(A)(i)(II)(ee), added subpar. (C) relating to separate allocation for tribal governments.

   Enacted provision · exact public law section
   (ee) by adding at the end the following: “(C) Separate allocation for tribal governments.— “(i) In general.— With respect to States that are Tribal governments, the Secretary shall determine the 2021 allocation by allocating $500,000,000 among the Tribal governments in the proportion the Secretary determines appropriate, including with consideration to available employment and economic data regarding each such Tribal government. “(ii) Notice of intent; timing of allocation.— With respect to allocations to States that are Tribal governments, the Secretary may— “(I) require Tribal governments that individually or jointly wish to participate in the Program to file a notice of intent with the Secretary not later than 30 days after the date of enactment of subsection (d); and “(II) notwithstanding paragraph (1), allocate Federal funds to participating Tribal governments not later than 60 days after the date of enactment of subsection (d). “(D) Employment data.— If the Secretary determines that employment data with respect to a State is unavailable from the Bureau of Labor Statistics of the Department of Labor, the Secretary shall consider such other economic and employment data that is otherwise available for purposes of determining the employment data of such State.” ; and

   Effective date note
   Amendment by Pub. L. 117–2 applicable with respect to funds appropriated under section 3301 of Pub. L. 117–2 and funds appropriated on and after Mar. 11, 2021, see section 3301(g) of Pub. L. 117–2, set out as a note under section 5701 of this title.

7. 2021

   American Rescue Plan Act of 2021

   Pub. L. 117–2 § 3301(a)(1)(A)(i)(II)(dd) · 135 Stat. 4

   Substituted · 12 U.S.C. § 5702(b)(2)(C)(i)

   Pub. L. 117–2, § 3301(a)(1)(A)(i)(II)(dd), substituted “2019” for “2007” in cl. (i) of subpar. (C) defining 2020 State employment decline

   Source evidence

   Code amendment note
   Subsec. (b)(2)(C)(i). Pub. L. 117–2, § 3301(a)(1)(A)(i)(II)(dd), substituted “2019” for “2007” in cl. (i) of subpar. (C) defining 2020 State employment decline.

   Enacted provision · exact public law section
   (dd) in subparagraph (C)(i), by striking “2007” and inserting “2019”; and

   Effective date note
   Amendment by Pub. L. 117–2 applicable with respect to funds appropriated under section 3301 of Pub. L. 117–2 and funds appropriated on and after Mar. 11, 2021, see section 3301(g) of Pub. L. 117–2, set out as a note under section 5701 of this title.

8. 2021

   American Rescue Plan Act of 2021

   Pub. L. 117–2 § 3301(a)(1)(A)(i)(II)(ee) · 135 Stat. 4

   Added · 12 U.S.C. § 5702(b)(2)(D)

   Pub. L. 117–2, § 3301(a)(1)(A)(i)(II)(ee), added subpar. (D)

   Source evidence

   Code amendment note
   Subsec. (b)(2)(D). Pub. L. 117–2, § 3301(a)(1)(A)(i)(II)(ee), added subpar. (D).

   Enacted provision · exact public law section
   (ee) by adding at the end the following: “(C) Separate allocation for tribal governments.— “(i) In general.— With respect to States that are Tribal governments, the Secretary shall determine the 2021 allocation by allocating $500,000,000 among the Tribal governments in the proportion the Secretary determines appropriate, including with consideration to available employment and economic data regarding each such Tribal government. “(ii) Notice of intent; timing of allocation.— With respect to allocations to States that are Tribal governments, the Secretary may— “(I) require Tribal governments that individually or jointly wish to participate in the Program to file a notice of intent with the Secretary not later than 30 days after the date of enactment of subsection (d); and “(II) notwithstanding paragraph (1), allocate Federal funds to participating Tribal governments not later than 60 days after the date of enactment of subsection (d). “(D) Employment data.— If the Secretary determines that employment data with respect to a State is unavailable from the Bureau of Labor Statistics of the Department of Labor, the Secretary shall consider such other economic and employment data that is otherwise available for purposes of determining the employment data of such State.” ; and

   Effective date note
   Amendment by Pub. L. 117–2 applicable with respect to funds appropriated under section 3301 of Pub. L. 117–2 and funds appropriated on and after Mar. 11, 2021, see section 3301(g) of Pub. L. 117–2, set out as a note under section 5701 of this title.

9. 2021

   American Rescue Plan Act of 2021

   Pub. L. 117–2 § 3301(a)(1)(A)(i)(III) · 135 Stat. 4

   Struck · 12 U.S.C. § 5702(b)(3)

   Pub. L. 117–2, § 3301(a)(1)(A)(i)(III), struck out par. (3) which provided for the 2010 allocation formula

   Source evidence

   Code amendment note
   Subsec. (b)(3). Pub. L. 117–2, § 3301(a)(1)(A)(i)(III), struck out par. (3) which provided for the 2010 allocation formula.

   Enacted provision · exact public law section
   (III) by striking paragraph (3); and

   Effective date note
   Amendment by Pub. L. 117–2 applicable with respect to funds appropriated under section 3301 of Pub. L. 117–2 and funds appropriated on and after Mar. 11, 2021, see section 3301(g) of Pub. L. 117–2, set out as a note under section 5701 of this title.

10. 2021

    American Rescue Plan Act of 2021

    Pub. L. 117–2 § 3301(a)(1)(A)(ii)(I) · 135 Stat. 4

    Inserted · 12 U.S.C. § 5702(c)(1)(A)(iii)

    Pub. L. 117–2, § 3301(a)(1)(A)(ii)(I), inserted before period at end “that have delivered loans or investments to eligible businesses”

    Source evidence

    Code amendment note
    Subsec. (c)(1)(A)(iii). Pub. L. 117–2, § 3301(a)(1)(A)(ii)(I), inserted before period at end “that have delivered loans or investments to eligible businesses”.

    Enacted provision · exact public law section
    (I) in paragraph (1)(A)(iii), by inserting before the period the following: “that have delivered loans or investments to eligible businesses”; and

    Effective date note
    Amendment by Pub. L. 117–2 applicable with respect to funds appropriated under section 3301 of Pub. L. 117–2 and funds appropriated on and after Mar. 11, 2021, see section 3301(g) of Pub. L. 117–2, set out as a note under section 5701 of this title.

11. 2021

    American Rescue Plan Act of 2021

    Pub. L. 117–2 § 3301(a)(1)(A)(ii)(II) · 135 Stat. 4

    Amended · 12 U.S.C. § 5702(c)(4)

    Pub. L. 117–2, § 3301(a)(1)(A)(ii)(II), amended par. (4) generally. Prior to amendment, text read as follows: “Any portion of a participating State’s allocated amount that has not been transferred to the State under this section by the end of the 2-year period beginning on the date that the Secretary approves the State for participation may be deemed by the Secretary to be no longer allocated to the State and no longer available to the State and shall be returned to the General Fund of the Treasury.”

    Source evidence

    Code amendment note
    Subsec. (c)(4). Pub. L. 117–2, § 3301(a)(1)(A)(ii)(II), amended par. (4) generally. Prior to amendment, text read as follows: “Any portion of a participating State’s allocated amount that has not been transferred to the State under this section by the end of the 2-year period beginning on the date that the Secretary approves the State for participation may be deemed by the Secretary to be no longer allocated to the State and no longer available to the State and shall be returned to the General Fund of the Treasury.”

    Enacted provision · exact public law section
    (II) by amending paragraph (4) to read as follows: “(4) Termination of availability of amounts not transferred.— “(A) In general.— Any portion of a participating State’s allocated amount that has not been transferred to the State under this section may be deemed by the Secretary to be no longer allocated to the State and no longer available to the State and shall be returned to the general fund of the Treasury or reallocated as described under subparagraph (B), if— “(i) the second ⅓ of a State’s allocated amount has not been transferred to the State before the end of the end of the 3-year period beginning on the date that the Secretary approves the State for participation; or “(ii) the last ⅓ of a State’s allocated amount has not been transferred to the State before the end of the end of the 6-year period beginning on the date that the Secretary approves the State for participation. “(B) Reallocation.— Any amount deemed by the Secretary to be no longer allocated to a State and no longer available to such State under subparagraph (A) may be reallocated by the Secretary to other participating States. In making such a reallocation, the Secretary shall not take into account the minimum allocation requirements under subsection (b)(2)(B) or the specific allocation for Tribal governments described under subsection (b)(2)(C).” ;

    Effective date note
    Amendment by Pub. L. 117–2 applicable with respect to funds appropriated under section 3301 of Pub. L. 117–2 and funds appropriated on and after Mar. 11, 2021, see section 3301(g) of Pub. L. 117–2, set out as a note under section 5701 of this title.

12. 2021

    American Rescue Plan Act of 2021

    Pub. L. 117–2 § 3301(b) · 135 Stat. 4

    Added · 12 U.S.C. § 5702(d); 12 U.S.C. § 5702(e)

    Pub. L. 117–2, § 3301(b), added subsecs. (d) and (e)

    Source evidence

    Code amendment note
    Subsecs. (d), (e). Pub. L. 117–2, § 3301(b), added subsecs. (d) and (e).

    Enacted provision · exact public law section
    (b) Additional Allocations to Support Business Enterprises Owned and Controlled by Socially and Economically Disadvantaged Individuals.— Section 3003 of the State Small Business Credit Initiative Act of 2010 (12 U.S.C. 5702) is amended by adding at the end the following: “(d) Additional Allocations to Support Business Enterprises Owned and Controlled by Socially and Economically Disadvantaged Individuals.— Of the amounts appropriated for fiscal year 2021 to carry out the Program, the Secretary shall— “(1) allocate $1,500,000,000 to States from funds allocated under this section and, by regulation or other guidance, prescribe Program requirements that the funds be expended for business enterprises owned and controlled by socially and economically disadvantaged individuals; and “(2) allocate such amounts to States based on the needs of business enterprises owned and controlled by socially and economically disadvantaged individuals, as determined by the Secretary, in each State, and not subject to the allocation formula described under subsection (b). “(e) Incentive Allocations to Support Business Enterprises Owned and Controlled by Socially and Economically Disadvantaged Individuals.— Determination. Of the amounts appropriated for fiscal year 2021 to carry out the Program, the Secretary shall set aside $1,000,000,000 for an incentive program under which the Secretary shall increase the second ⅓ and last ⅓ allocations for States that demonstrate robust support, as determined by the Secretary, for business concerns owned and controlled by socially and economically disadvantaged individuals in the deployment of prior allocation amounts.” .

    Effective date note
    Amendment by Pub. L. 117–2 applicable with respect to funds appropriated under section 3301 of Pub. L. 117–2 and funds appropriated on and after Mar. 11, 2021, see section 3301(g) of Pub. L. 117–2, set out as a note under section 5701 of this title.

13. 2021

    American Rescue Plan Act of 2021

    Pub. L. 117–2 § 3301(c) · 135 Stat. 4

    Added · 12 U.S.C. § 5702(f)

    Pub. L. 117–2, § 3301(c), added subsec. (f)

    Source evidence

    Code amendment note
    Subsec. (f). Pub. L. 117–2, § 3301(c), added subsec. (f).

    Enacted provision · exact public law section
    (c) Additional Allocations to Support Very Small Businesses.— Section 3003 of the State Small Business Credit Initiative Act of 2010 (12 U.S.C. 5702), as amended by subsection (b), is further amended by adding at the end the following: “(f) Additional Allocations to Support Very Small Businesses.— “(1) In general.— Of the amounts appropriated to carry out the Program, the Secretary shall allocate not less than $500,000,000 to States from funds allocated under this section to be expended for very small businesses. “(2) Very small business defined.— In this subsection, the term ‘very small business’— “(A) means a business with fewer than 10 employees; and “(B) may include independent contractors and sole proprietors.” .

    Effective date note
    Amendment by Pub. L. 117–2 applicable with respect to funds appropriated under section 3301 of Pub. L. 117–2 and funds appropriated on and after Mar. 11, 2021, see section 3301(g) of Pub. L. 117–2, set out as a note under section 5701 of this title.

13 of 13 references resolved to an enrolled provision