(a) Alternative uses (1) In general Notwithstanding any other provision of law, an eligible local educational agency may use the applicable funding that the agency is eligible to receive from the State educational agency for a fiscal year to carry out local activities authorized under any of the following provisions: (A) Part A of subchapter I of this chapter. (B) Part A or D of subchapter II of this chapter. (C) Subchapter III of this chapter. (D) Part A or B of subchapter IV of this chapter. (E) Part A of subchapter V of this chapter. (2) Notification An eligible local educational agency shall notify the State educational agency of the local educational agency's intention to use the applicable funding in accordance with paragraph (1), by a date that is established by the State educational agency for the notification. (b) Eligibility (1) In general A local educational agency shall be eligible to use the applicable funding in accordance with subsection (a) of this section if - (A)(i)(I) the total number of students in average daily attendance at all of the schools served by the local educational agency is fewer than 600; or (II) each county in which a school served by the local educational agency is located has a total population density of fewer than 10 persons per square mile; and (ii) all of the schools served by the local educational agency are designated with a school locale code of 7 or 8, as determined by the Secretary; or (B) the agency meets the criteria established in subparagraph (A)(i) and the Secretary, in accordance with paragraph (2), grants the local educational agency's request to waive the criteria described in subparagraph (A)(ii). (2) Certification The Secretary shall determine whether to waive the criteria described in paragraph (1)(A)(ii) based on a demonstration by the local educational agency, and concurrence by the State educational agency, that the local educational agency is located in an area defined as rural by a governmental agency of the State. (c) Applicable funding defined In this section, the term "applicable funding" means funds provided under any of the following provisions: (1) Subpart 2 of this part and section 6762(a)(2)(A) of this title. (2) Section 7114 of this title. (3) Part A of subchapter V of this chapter. (d) Disbursement Each State educational agency that receives applicable funding for a fiscal year shall disburse the applicable funding to local educational agencies for alternative uses under this section for the fiscal year at the same time as the State educational agency disburses the applicable funding to local educational agencies that do not intend to use the applicable funding for such alternative uses for the fiscal year. (e) Applicable rules Applicable funding under this section shall be available to carry out local activities authorized under subsection (a) of this section.