34 CFR §222.23

1. (a)Eligibility. An LEA formed by the consolidation of one or more LEAs is eligible for section 7002 funds, notwithstanding section 222.21(a)(1), if—
   1. (1)The consolidation occurred prior to fiscal year 1995 or after fiscal year 2005; and
   2. (2)At least one of the former LEAs included in the consolidation:
      1. (i)Was eligible for section 7002 funds in the fiscal year prior to the consolidation; and
      2. (ii)Currently contains Federal property that meets the requirements of § 222.21(a) within the boundaries of the former LEA or LEAs.
2. (b)Documentation required. In the first year of application following the consolidation, an LEA that meets the requirements of paragraph (a) of this section must submit evidence that it meets the requirements of paragraphs (a)(1) and (a)(2)(ii) of this section.
3. (c)Basis for foundation payment.
   1. (1)The foundation payment for a consolidated district is based on the total section 7002 payment for the last fiscal year for which the former LEA received payment. When more than one former LEA qualifies under paragraph (a)(2) of this section, the payments for the last fiscal year for which the former LEAs received payment are added together to calculate the foundation basis.
   2. (2)Consolidated LEAs receive only a foundation payment and do not receive a payment from any remaining funds.