The Secretary amends the regulations for the Assistance to States for the Education of Children with Disabilities program under Part B of the Individuals with Disabilities Education Act (IDEA; Part B)). This amendment is needed to implement the statutory provision that for any fiscal year in which the appropriation for section 611 ofthe IDEA exceeds $4.1 billion, a local educational agency (LEA) may treat as local funds up to 20 percent of the amount it receives that exceeds the amount it received during the prior fiscal year. The amendment is intended to ensure effective implementation of the 20 percent rule by clarifying which funds under Part B of IDEA can be included in the 20 percent calculation, and, as a result, to reduce the potential for audit exceptions.