(iii) the Watershed Protection and Flood Prevention Act (16 U.S.C. 1001 et seq.);

(iv) the Carl D. Perkins Vocational and Technical Education Act of 1998 (20 U.S.C. 2301 et seq.);

(v) the Federal Water Pollution Control Act (33 U.S.C. 1251 et seq.) (known as the Clean Water Act); (vi) title VI of the Public Health Services Act (42 U.S.C. 291 et seq.);

(vii) sections 201 and 209 of the Public Works and Economic Development Act of 1965 (42 U.S.C. 3141, 3149);

(viii) title I of the Housing and Community Development Act of 1974 (42 U.S.C. 5301 et seq.); and

(ix) part IV of title III of the Communications Act of 1934 (47 U.S.C. 390 et seq.); but (B) does not include

(i) the program for the construction of the development highway system authorized by section 14501 of this title or any other program relating to highway or road construction authorized by title 23; or

(ii) any other program to the extent that financial assistance other than a grant is authorized.

(2) CERTAIN SEWAGE TREATMENT WORKS DEEMED CONSTRUCTED WITH FEDERAL GRANT ASSISTANCE.-For the purpose of this section, any sewage treatment works constructed pursuant to title II of the Federal Water Pollution Control Act (33 U.S.C. 1281 et seq.) (known as the Clean Water Act) without federal grant assistance under that title is deemed to be constructed with that assistance.

(b) PURPOSE.-To enable the people, States, and local communities of the Appalachian region, including local development districts, to take maximum advantage of federal grant programs for which they are eligible but for which, because of their economic situation, they cannot supply the required matching share, or for which there are insufficient amounts available under the federal law authorizing the programs to meet pressing needs of the region, the Federal Cochairman may use amounts made available to carry out this

section

(1) for any part of the basic federal contribution to projects or activities under the federal grant programs authorized by federal laws; and

(2) to increase the federal contribution to projects and activities under the programs above the fixed maximum part of the cost of the projects or activities otherwise authorized by the applicable law.

(c) CERTIFICATION REQUIRED.-For a program, project, or activity for which any part of the basic federal contribution to the project or activity under a federal grant program is proposed to be made under subsection (b), the contribution shall not be made until the responsible federal official administering the federal law authorizing the contribution certifies that the program, project, or activity meets the applicable requirements of the federal law and could be approved for federal contribution under that law if amounts were available under the law for the program, project, or activity.

(d) LIMITATIONS IN OTHER LAWS INAPPLICABLE.-Amounts provided pursuant to this subtitle are available without regard to

any limitations on areas eligible for assistance or authorizations for appropriation in any other law.

(e) ACCEPTANCE OF CERTAIN MATERIAL. For a supplemental grant for a project or activity under a federal grant program, the Federal Cochairman shall accept any finding, report, certification, or documentation required to be submitted to the head of the department, agency, or instrumentality of the Federal Government responsible for the administration of the program. (f) FEDERAL SHARE.-The federal portion of the cost of a project or activity shall not

(1) be increased to more than the percentages the Commission establishes; nor

(2) be more than 80 percent of the cost.

(g) MAXIMUM COMMISSION CONTRIBUTION.—

(1) IN GENERAL.-Subject to paragraph (2), the Commission may contribute not more than 50 percent of a project or activity cost eligible for financial assistance under this section from amounts appropriated to carry out this subtitle.

(2) DISTRESSED COUNTIES.-The maximum Commission contribution for a project or activity to be carried out in a county for which a distressed county designation is in effect under section 14526 of this title may be increased to 80 percent.

SUBCHAPTER II-ADMINISTRATIVE

§ 14521. Required level of expenditure

A State or political subdivision of a State is not eligible to receive benefits under this subtitle unless the aggregate expenditure of state amounts, except expenditures for participation in the Dwight D. Eisenhower System of Interstate and Defense Highways and local and federal amounts, for the benefit of the area within the State located in the Appalachian region is maintained at a level which does not fall below the average level of those expenditures for the State's last two full fiscal years prior to March 9, 1965. In computing the level, a State's past expenditure for participation in the Dwight D. Eisenhower System of Interstate and Defense Highways and expenditures of local and federal amounts shall not be included. The Commission shall recommend to the President a lesser requirement when it finds that a substantial population decrease in that part of a State which lies within the region would not justify a state expenditure equal to the average level of the last two years or when it finds that a State's average level of expenditure in an individual program has been disproportionate to the present need for that part of the State.

$14522. Consent of States

This subtitle does not require a State to engage in or accept a program under this subtitle without its consent.

§ 14523. Program implementation

(a) REQUIREMENTS.-A program or project authorized under this chapter shall not be implemented until

(1) the responsible federal official has decided that applications and plans relating to the program or project are not incompatible with the provisions and objectives of federal laws that the official administers that are not inconsistent with this subtitle; and

(2) the Appalachian Regional Commission has approved the program or project and has determined that it—

(A) meets the applicable criteria under section 14524 of this title and the requirements of the development planning process under section 14525 of this title; and

(B) will contribute to the development of the Appalachian region.

(b) DECISION IS CONTROLLING.-A decision under subsection (a)(2) is controlling and shall be accepted by the federal agencies.

§ 14524. Program development criteria

(a) FACTORS TO BE CONSIDERED.-In considering programs and projects to be given assistance under this subtitle, and in establishing a priority ranking of the requests for assistance presented to the Appalachian Regional Commission, the Commission shall follow procedures that will ensure consideration of

(1) the relationship of the project or class of projects to overall regional development, including its location in a severely and persistently distressed county or area;

(2) the population and area to be served by the project or class of projects, including the per capita market income and the unemployment rates in the area;

(3) the relative financial resources available to the State or political subdivisions or instrumentalities of the State that seek to undertake the project;

(4) the importance of the project or class of projects in relation to other projects or classes of projects that may be in competition for the same amounts;

(5) the prospects that the project for which assistance is sought will improve, on a continuing rather than a temporary basis, the opportunities for employment, the average level of income, or the economic and social development of the area served by the project; and

(6) the extent to which the project design provides for detailed outcome measurements by which grant expenditures may be evaluated.

(b) LIMITATION ON USE.-Financial assistance made available under this subtitle shall not be used to assist establishments relocating from one area to another.

(c) DETERMINATION REQUIRED BEFORE AMOUNTS MAY BE PROVIDED.-Amounts may be provided for programs and projects in a State under this subtitle only if the Commission determines that the level of federal and state financial assistance under other laws for the same type of programs or projects in that part of the State within the Appalachian region will not be diminished in order to substitute amounts authorized by this subtitle.

(d) MINIMUM AMOUNT OF ASSISTANCE TO DISTRESSED COUNTIES AND AREAS. For each fiscal year, not less than 50 percent of the amount of grant expenditures the Commission approves shall support activities or projects that benefit severely and persistently distressed counties and areas.

§ 14525. State development planning process

(a) STATE DEVELOPMENT PLAN.-Pursuant to policies the Appalachian Regional Commission establishes, each state member shall submit a development plan for the area of the State within the Appalachian region. The plan shall

(1) be submitted according to a schedule the Commission prescribes;

(2) reflect the goals, objectives, and priorities identified in the regional development plan and in any subregional development plan that may be approved for the subregion of which the State is a part;

(3) describe the state organization and continuous process for Appalachian development planning, including

(A) the procedures established by the State for the participation of local development districts in the process; (B) how the process is related to overall statewide planning and budgeting processes; and

(C) the method of coordinating planning and projects in the region under this subtitle, the Public Works and Economic Development Act of 1965 (42 U.S.C. 3121 et seq.), and other federal, state, and local programs;

(4) set forth the goals, objectives, and priorities of the State for the region, as established by the Governor, and identify the needs on which the goals, objectives, and priorities are based; and

(5) describe the development strategies for achieving the goals, objectives, and priorities, including funding sources, and recommendations for specific projects to receive assistance under this subtitle.

(b) AREAWIDE ACTION PROGRAMS.-The Commission shall encourage the preparation and execution of areawide action programs that specify interrelated projects and schedules of actions, the necessary agency funding, and other commitments to implement the programs. The programs shall make appropriate use of existing plans affecting the area.

(c) LOCAL DEVELOPMENT DISTRICTS.-Local development districts certified by the State as described in section 14102(a)(2) of this title provide the linkage between state and substate planning and development. The districts shall assist the States in the coordination of areawide programs and projects and may prepare and adopt areawide plans or action programs. In carrying out the development planning process, including the selection of programs and projects for assistance, States shall consult with local development districts, local units of government, and citizen groups and shall consider the goals, objectives, priorities, and recommendations of those bodies.

(d) FEDERAL RESPONSIBILITIES.-To the maximum extent practicable, federal departments, agencies, and instrumentalities undertaking or providing financial assistance for programs or projects in the region shall

(1) take into account the policies, goals, and objectives the Commission and its member States establish pursuant to this subtitle;

(2) recognize Appalachian state development strategies approved by the Commission as satisfying requirements for overall economic development planning under the programs or projects; and

(3) accept the boundaries and organization of any local development district certified under this subtitle that the Governor may designate as the areawide agency required under any of those programs undertaken or assisted by those federal departments, agencies, and instrumentalities.

§ 14526. Distressed and economically strong counties

(a) DESIGNATIONS.

(1) IN GENERAL.-The Appalachian Regional Commission, in accordance with criteria the Commission may establish, each year shall

(A) designate as "distressed counties" those counties in the Appalachian region that are the most severely and persistently distressed; and

(B) designate two categories of economically strong counties, consisting of

(i) "competitive counties", which shall be those counties in the region that are approaching economic parity with the rest of the United States; and

(ii) "attainment counties", which shall be those counties in the region that have attained or exceeded economic parity with the rest of the United States. (2) ANNUAL REVIEW OF DESIGNATIONS.-The Commission shall

(A) conduct an annual review of each designation of a county under paragraph (1) to determine if the county still meets the criteria for the designation; and

(B) renew the designation for another one-year period only if the county still meets the criteria.

(b) DISTRESSED COUNTIES.-In program and project development and implementation and in the allocation of appropriations made available to carry out this subtitle, the Commission shall give special consideration to the needs of counties for which a distressed county designation is in effect under this section.

(c) ECONOMICALLY STRONG COUNTIES.—

(1) COMPETITIVE COUNTIES.-Except as provided in paragraphs (3) and (4), assistance under this subtitle for a project that is carried out in a county for which a competitive county designation is in effect under this section shall not be more than 30 percent of the project cost.

(2) ATTAINMENT COUNTIES.-Except as provided in paragraphs (3) and (4), amounts may not be provided under this subtitle for a project that is carried out in a county for which an attainment county designation is in effect under this section. (3) EXCEPTIONS.-Paragraphs (1) and (2) do not apply to— (A) a project on the Appalachian development highway system authorized by section 14501 of this title; (B) a local development district administrative project assisted under section 14321(a)(1)(A) of this title; or

(C) a multicounty project that is carried out in at least two counties designated under this section if

(i) at least one of the participating counties is designated as a distressed county under this section; and (ii) the project will be of substantial direct benefit to at least one distressed county.

(4) WAIVER.—

(A) IN GENERAL.-The Commission may waive the requirements of paragraphs (1) and (2) for a project when the recipient of assistance for the project shows the existence of any of the following:

(i) a significant pocket of distress in the part of the county in which the project is carried out.