(a) Amounts equal to or less than trigger amount
From amounts made available for each fiscal year under subsection ¹ 6302(b) of this title that are equal to or less than the amount described in section 6311(b)(2)(I) of this title, the Secretary shall—

(1) reserve one-half of 1 percent for the Bureau of Indian Education;

(2) reserve one-half of 1 percent for the outlying areas;

(3) reserve not more than 20 percent to carry out section 6362 of this title; and

(4) from the remainder, carry out section 6361 of this title by allocating to each State an amount equal to—

(A) $3,000,000, except for a fiscal year for which the amounts available are insufficient to allocate such amount to each State, the Secretary shall ratably reduce such amount for each State; and

(B) with respect to any amounts remaining after the allocation under subparagraph (A), an amount that bears the same relationship to such total remaining amounts as the number of students aged 5 through 17 in the State (as determined by the Secretary on the basis of the most recent satisfactory data) bears to the total number of such students in all States.

(b) Amounts above trigger amount
For any fiscal year for which the amount made available for a fiscal year under subsection ¹ 6302(b) of this title exceeds the amount described in section 6311(b)(2)(I) of this title, the Secretary shall make such excess amount available as follows:

(1) Competitive grants

(A) In general
The Secretary shall first use such funds to award grants, on a competitive basis, to State educational agencies or consortia of State educational agencies that have submitted applications described in subparagraph (B) to enable such States to carry out the activities described in subparagraphs (C), (H), (I), (J), (K), and (L) of section 6361(a)(2) of this title.

(B) Applications
A State, or a consortium of States, that desires a competitive grant under subparagraph (A) shall submit an application to the Secretary at such time and in such manner as the Secretary may reasonably require. The application shall demonstrate that the requirements of this section will be met for the uses of funds described under subparagraph (A).

(C) Amount of competitive grants
In determining the amount of a grant under subparagraph (A), the Secretary shall ensure that a State or consortium's grant, as the case may be, shall include an amount that bears the same relationship to the total funds available to carry out this subsection for the fiscal year as the number of students aged 5 through 17 in the State, or, in the case of a consortium, in each State that comprises the consortium, (as determined by the Secretary on the basis of the most recent satisfactory data) bears to the total number of such students in all States.

(2) Allotments
Any amounts remaining after the Secretary awards funds under paragraph (1) shall be allotted to each State, or consortium of States, that did not receive a grant under such paragraph, in an amount that bears the same relationship to the remaining amounts as the number of students aged 5 through 17 in the State, or, in the case of a consortium, in the States of the consortium, (as determined by the Secretary on the basis of the most recent satisfactory data) bears to the total number of such students in all States.

(c) State defined
In this part, the term "State" means each of the 50 States, the District of Columbia, and the Commonwealth of Puerto Rico.

(d) Prohibition
In making funds available to States under this part, the Secretary shall comply with the prohibitions described in section 7909 of this title.