§ 7112. Payments to States and counties

(a) Payment amounts
Except as provided in section 7113 of this title, the Secretary of the Treasury shall pay to—
(1) a State or territory of the United States an amount equal to the sum of the amounts elected under subsection (b) by each county within the State or territory for—
(A) if the county is eligible for the 25-percent payment, the share of the 25-percent payment; or
(B) the share of the State payment of the eligible county; and
(2) a county an amount equal to the amount elected under subsection (b) by each county for—
(A) if the county is eligible for the 50-percent payment, the 50-percent payment; or
(B) the county payment for the eligible county.
(b) Election to receive payment amount
(1) Election; submission of results
(A) In general
The election to receive a share of the State payment, the county payment, a share of the State payment and the county payment, a share of the 25-percent payment, the 50-percent payment, or a share of the 25-percent payment and the 50-percent payment, as applicable, shall be made at the discretion of each affected county by August 1, 2008 (or as soon thereafter as the Secretary concerned determines is practicable), and August 1 of each second fiscal year thereafter, in accordance with paragraph (2), and transmitted to the Secretary concerned by the Governor of each eligible State.
(B) Failure to transmit
If an election for an affected county is not transmitted to the Secretary concerned by the date specified under subparagraph (A), the affected county shall be considered to have elected to receive a share of the State payment, the county payment, or a share of the State payment and the county payment, as applicable.
(2) Duration of election
(A) In general
A county election to receive a share of the 25-percent payment or 50-percent payment, as applicable, shall be effective for 2 fiscal years.
(B) Full funding amount
If a county elects to receive a share of the State payment or the county payment, the election shall be effective for all subsequent fiscal years through fiscal year 2011.
(3) Source of payment amounts
The payment to an eligible State or eligible county under this section for a fiscal year shall be derived from—
(A) any amounts that are appropriated to carry out this chapter;
(B) any revenues, fees, penalties, or miscellaneous receipts, exclusive of deposits to any relevant trust fund, special account, or permanent operating funds, received by the Federal Government from activities by the Bureau of Land Management or the Forest Service on the applicable Federal land; and
(C) to the extent of any shortfall, out of any amounts in the Treasury of the United States not otherwise appropriated.
(c) Distribution and expenditure of payments
(1) Distribution method
A State that receives a payment under subsection (a) for Federal land described in section 7102 (7)(A) of this title shall distribute the appropriate payment amount among the appropriate counties in the State in accordance with—
(A) the Act of May 23, 1908 (16 U.S.C. 500); and
(B) section 13 of the Act of March 1, 1911 (36 Stat. 963; 16 U.S.C. 500).
(2) Expenditure purposes
Subject to subsection (d), payments received by a State under subsection (a) and distributed to counties in accordance with paragraph (1) shall be expended as required by the laws referred to in paragraph (1).
(d) Expenditure rules for eligible counties
(1) Allocations
(A) Use of portion in same manner as 25-percent payment or 50-percent payment, as applicable
Except as provided in paragraph (3)(B), if an eligible county elects to receive its share of the State payment or the county payment, not less than 80 percent, but not more than 85 percent, of the funds shall be expended in the same manner in which the 25-percent payments or 50-percent payment, as applicable, are required to be expended.
(B) Election as to use of balance
Except as provided in subparagraph (C), an eligible county shall elect to do 1 or more of the following with the balance of any funds not expended pursuant to subparagraph (A):
(i) Reserve any portion of the balance for projects in accordance with subchapter II.
(ii) Reserve not more than 7 percent of the total share for the eligible county of the State payment or the county payment for projects in accordance with subchapter III.
(iii) Return the portion of the balance not reserved under clauses (i) and (ii) to the Treasury of the United States.
(C) Counties with modest distributions
In the case of each eligible county to which more than $100,000, but less than $350,000, is distributed for any fiscal year pursuant to either or both of paragraphs (1)(B) and (2)(B) of subsection (a), the eligible county, with respect to the balance of any funds not expended pursuant to subparagraph (A) for that fiscal year, shall—
(i) reserve any portion of the balance for—
(I) carrying out projects under subchapter II;
(II) carrying out projects under subchapter III; or
(III) a combination of the purposes described in subclauses (I) and (II); or
(ii) return the portion of the balance not reserved under clause (i) to the Treasury of the United States.
(2) Distribution of funds
(A) In general
Funds reserved by an eligible county under subparagraph (B)(i) or (C)(i) of paragraph (1) for carrying out projects under subchapter II shall be deposited in a special account in the Treasury of the United States.
(B) Availability
Amounts deposited under subparagraph (A) shall—
(i) be available for expenditure by the Secretary concerned, without further appropriation; and
(ii) remain available until expended in accordance with subchapter II.
(3) Election
(A) Notification
(i) In general An eligible county shall notify the Secretary concerned of an election by the eligible county under this subsection not later than September 30, 2008 (or as soon thereafter as the Secretary concerned determines is practicable), and each September 30 thereafter for each succeeding fiscal year.
(ii) Failure to elect Except as provided in subparagraph (B), if the eligible county fails to make an election by the date specified in clause (i), the eligible county shall—
(I) be considered to have elected to expend 85 percent of the funds in accordance with paragraph (1)(A); and
(II) return the balance to the Treasury of the United States.
(B) Counties with minor distributions
In the case of each eligible county to which less than $100,000 is distributed for any fiscal year pursuant to either or both of paragraphs (1)(B) and (2)(B) of subsection (a), the eligible county may elect to expend all the funds in the same manner in which the 25-percent payments or 50-percent payments, as applicable, are required to be expended.
(e) Time for payment
The payments required under this section for a fiscal year shall be made as soon as practicable after the end of that fiscal year.