(a) Program authorized

(1) In general
The Secretary shall use not less than 95 percent of the amounts made available under section 7251(b)(2)(B) of this title to award grants, on a competitive basis and subject to subsection (e), to eligible entities for the following activities:

(A) Promise neighborhoods
The implementation of a comprehensive, effective continuum of coordinated services that meets the purpose described in section 7271(1) of this title by carrying out activities in neighborhoods with—

(i) high concentrations of low-income individuals;

(ii) multiple signs of distress, which may include high rates of poverty, childhood obesity, academic failure, and juvenile delinquency, adjudication, or incarceration; and

(iii) schools implementing comprehensive support and improvement activities or targeted support and improvement activities under section 6311(d) of this title.

(B) Full-service community schools
The provision of assistance to public elementary schools or secondary schools to function as full-service community schools.

(2) Sufficient size and scope
Each grant awarded under this subpart shall be of sufficient size and scope to allow the eligible entity to carry out the applicable purposes of this subpart.

(b) Duration
A grant awarded under this subpart shall be for a period of not more than 5 years, and may be extended for an additional period of not more than 2 years.

(c) Continued funding
Continued funding of a grant under this subpart, including a grant extended under subsection (b), after the third year of the initial grant period shall be contingent on the eligible entity's progress toward meeting—

(1) with respect to a grant for activities described in section 7274 of this title, the performance metrics described in section 7274(h) of this title; and

(2) with respect to a grant for activities described in section 7275 of this title, annual performance objectives and outcomes under section 7275(a)(4)(C) of this title.

(d) Matching requirements

(1) Promise neighborhood activities

(A) Matching funds
Each eligible entity receiving a grant under this subpart for activities described in section 7274 of this title shall contribute matching funds in an amount equal to not less than 100 percent of the amount of the grant. Such matching funds shall come from Federal, State, local, and private sources.

(B) Private sources
The Secretary shall require that a portion of the matching funds come from private sources, which may include in-kind contributions.

(C) Adjustment
The Secretary may adjust the matching funds requirement under this paragraph for applicants that demonstrate high need, including applicants from rural areas and applicants that wish to provide services on tribal lands.

(D) Financial hardship waiver
The Secretary may waive or reduce, on a case-by-case basis, the matching requirement under this paragraph, including the requirement for funds from private sources, for a period of 1 year at a time, if the eligible entity demonstrates significant financial hardship.

(2) Full-service community schools activities

(A) In general
Each eligible entity receiving a grant under this subpart for activities described in section 7275 of this title shall provide matching funds from non-Federal sources, which may be provided in part with in-kind contributions.

(B) Special rule
The Bureau of Indian Education may meet the requirement of subparagraph (A) using funds from other Federal sources.

(3) Special rules

(A) In general
The Secretary may not require any eligible entity receiving a grant under this subpart to provide matching funds in an amount that exceeds the amount of the grant award.

(B) Consideration
Notwithstanding this subsection, the Secretary shall not consider the ability of an eligible entity to match funds when determining which applicants will receive grants under this subpart.

(e) Reservation for rural areas

(1) In general
From the amounts allocated under subsection (a) for grants to eligible entities, the Secretary shall use not less than 15 percent of such amounts to award grants to eligible entities that propose to carry out the activities described in such subsection in rural areas.

(2) Exception
The Secretary shall reduce the amount described in paragraph (1) if the Secretary does not receive a sufficient number of applications of sufficient quality.

(f) Minimum number of grants
For each fiscal year, the Secretary shall award under this subpart not fewer than 3 grants for activities described in section 7274 of this title and not fewer than 10 grants for activities described in section 7275 of this title, subject to the availability of appropriations, the requirements of subsection (a)(2), and the number and quality of applications.