For the purpose of relieving fiscal burdens on States and local educational agencies that have experienced a precipitous decline in financial resources, the Secretary of Education may waive or modify any requirement of this chapter relating to maintaining fiscal effort.

A waiver or modification under this section shall be for any of fiscal year 2009, fiscal year 2010, or fiscal year 2011, as determined by the Secretary.

The Secretary shall not grant a waiver or modification under this section unless the Secretary determines that the State receiving such waiver or modification will not provide for elementary, secondary, and public higher education, for the fiscal year under consideration, a smaller percentage of the total revenues available to the State than the percentage provided for such purpose in the preceding fiscal year.

Upon prior approval from the Secretary, a State or local educational agency that receives funds under this chapter may treat any portion of such funds that is used for elementary, secondary, or postsecondary education as non-Federal funds for the purpose of any requirement to maintain fiscal effort under any other program, including part C of the Individuals with Disabilities Education Act (20 U.S.C. 1431 et seq.), administered by the Secretary.

Notwithstanding (d),[1] the level of effort required by a State or local educational agency for the following fiscal year shall not be reduced.

(Pub. L. 111–5, div. A, title XIV, § 14012, Feb. 17, 2009, 123 Stat. 285; Pub. L. 111–8, div. F, title V, § 523(h), Mar. 11, 2009, 123 Stat. 806.)