42 U.S.C. § 702 — Allotment to States and Federal set-aside

**(a) Special projects** (1) Of the amounts appropriated under [section 701(a) of this title](https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title42-section701/a&num=0&edition=prelim) for a fiscal year that are not in excess of $600,000,000, the Secretary shall retain an amount equal to 15 percent for the purpose of carrying out activities described in [section 701(a)(2) of this title](https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title42-section701/a/2&num=0&edition=prelim). The authority of the Secretary to enter into any contracts under this subchapter is effective for any fiscal year only to such extent or in such amounts as are provided in appropriations Acts. (2) For purposes of paragraph (1)— (A) amounts retained by the Secretary for training shall be used to make grants to public or nonprofit private institutions of higher learning for training personnel for health care and related services for mothers and children; and (B) amounts retained by the Secretary for research shall be used to make grants to, contracts with, or jointly financed cooperative agreements with, public or nonprofit institutions of higher learning and public or nonprofit private agencies and organizations engaged in research or in maternal and child health or programs for children with special health care needs for research projects relating to maternal and child health services or services for children with special health care needs which show promise of substantial contribution to the advancement thereof. (3) No funds may be made available by the Secretary under this subsection or subsection (b) unless an application therefor has been submitted to, and approved by, the Secretary. Such application shall be in such form, be submitted in such manner, and contain and be accompanied by such information as the Secretary may specify. No such application may be approved unless it contains assurances that the applicant will use the funds provided only for the purposes specified in the approved application and will establish such fiscal control and fund accounting procedures as may be necessary to assure proper disbursement and accounting of Federal funds paid to the applicant under this subchapter. **(b) Excess funds; preference** (1) (A) Of the amounts appropriated under [section 701(a) of this title](https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title42-section701/a&num=0&edition=prelim) for a fiscal year in excess of $600,000,000 the Secretary shall retain an amount equal to 12¾ percent thereof for the projects described in subparagraphs (A) through (F) of [section 701(a)(3) of this title](https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title42-section701/a/3&num=0&edition=prelim). (B) Any amount appropriated under [section 701(a) of this title](https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title42-section701/a&num=0&edition=prelim) for a fiscal year in excess of $600,000,000 that remains after the Secretary has retained the applicable amount (if any) under subparagraph (A) shall be retained by the Secretary in accordance with subsection (a) and allocated to the States in accordance with subsection (c). (2) (A) Of the amounts retained for the purpose of carrying out activities described in section 701(a)(3)(A), (B), (C), (D) and (E) of this title, the Secretary shall provide preference to qualified applicants which demonstrate that the activities to be carried out with such amounts shall be in areas with a high infant mortality rate (relative to the average infant mortality rate in the United States or in the State in which the area is located). (B) In carrying out activities described in [section 701(a)(3)(D) of this title](https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title42-section701/a/3/D&num=0&edition=prelim), the Secretary shall not provide for developing or expanding a maternal and child health center unless the Secretary has received satisfactory assurances that there will be applied, towards the costs of such development or expansion, non-Federal funds in an amount at least equal to the amount of funds provided under this subchapter toward such development or expansion. **(c) Allotments to States** From the remaining amounts appropriated under [section 701(a) of this title](https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title42-section701/a&num=0&edition=prelim) for any fiscal year that are not in excess of $600,000,000, the Secretary shall allot to each State which has transmitted an application for the fiscal year under [section 705(a) of this title](https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title42-section705/a&num=0&edition=prelim), an amount determined as follows: (1) The Secretary shall determine, for each State— (A) (i) the amount provided or allotted by the Secretary to the State and to entities in the State under the provisions of the consolidated health programs (as defined in [section 701(b)(1) of this title](https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title42-section701/b/1&num=0&edition=prelim)), other than for any of the projects or programs described in subsection (a), from appropriations for fiscal year 1981, (ii) the proportion that such amount for that State bears to the total of such amounts for all the States, and (B) (i) the number of low income children in the State, and (ii) the proportion that such number of children for that State bears to the total of such numbers of children for all the States. (2) Each such State shall be allotted for each fiscal year an amount equal to the sum of— (A) the amount of the allotment to the State under this subsection in fiscal year 1983, and (B) the State’s proportion (determined under paragraph (1)(B)(ii)) of the amount by which the allotment available under this subsection for all the States for that fiscal year exceeds the amount that was available under this subsection for allotment for all the States for fiscal year 1983. **(d) Re-allotment of unallotted funds** (1) To the extent that all the funds appropriated under this subchapter for a fiscal year are not otherwise allotted to States either because all the States have not qualified for such allotments under [section 705(a) of this title](https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title42-section705/a&num=0&edition=prelim) for the fiscal year or because some States have indicated in their descriptions of activities under [section 705(a) of this title](https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title42-section705/a&num=0&edition=prelim) that they do not intend to use the full amount of such allotments, such excess shall be allotted among the remaining States in proportion to the amount otherwise allotted to such States for the fiscal year without regard to this paragraph. (2) To the extent that all the funds appropriated under this subchapter for a fiscal year are not otherwise allotted to States because some State allotments are offset under [section 706(b)(2) of this title](https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title42-section706/b/2&num=0&edition=prelim), such excess shall be allotted among the remaining States in proportion to the amount otherwise allotted to such States for the fiscal year without regard to this paragraph.