The Secretary of Transportation shall withhold up to 5 percent of the amount required to be apportioned to a State under section 104(b)(1), (3), and (4) [1] of title 23 on the first day of the fiscal year after the first fiscal year beginning after September 30, 1992, throughout which the State does not comply substantially with a requirement of section 31311(a) of this title.

The Secretary shall withhold up to 10 percent of the amount required to be apportioned to a State under section 104(b)(1), (3), and (4) 1 of title 23 on the first day of each fiscal year after the 2d fiscal year beginning after September 30, 1992, throughout which the State does not comply substantially with a requirement of section 31311(a) of this title.

Effective beginning on October 1, 2011—

(1) the penalty for the first instance of noncompliance by a State under this section shall be not more than an amount equal to 4 percent of funds required to be apportioned to the noncompliant State under paragraphs (1) and (2) of section 104(b) of title 23; and

(2) the penalty for subsequent instances of noncompliance shall be not more than an amount equal to 8 percent of funds required to be apportioned to the noncompliant State under paragraphs (1) and (2) of section 104(b) of title 23.

Amounts withheld under this section from apportionment to a State after September 30, 1995, are not available for apportionment to the State.

(Pub. L. 103–272, § 1(e), July 5, 1994, 108 Stat. 1028; Pub. L. 105–178, title IV, § 4011(g), (h), June 9, 1998, 112 Stat. 408; Pub. L. 105–206, title IX, § 9010, July 22, 1998, 112 Stat. 863; Pub. L. 109–59, title IV, § 4124(c), Aug. 10, 2005, 119 Stat. 1738; Pub. L. 112–141, div. A, title I, § 1404(j), July 6, 2012, 126 Stat. 559.)