Targeted Fiscal Assistance Act of 1989

Targeted Fiscal Assistance Act of 1989 - Repeals provisions of the Consolidated Omnibus Budget Reconciliation Act of 1985 that terminated the general revenue sharing program. Revises the program to establish a framework for targeted fiscal assistance. Authorizes FY 1989 through 1991 appropriations.

Directs the Secretary of the Treasury, for each entitlement period, to allocate: (1) special entitlements for Indian tribes, Alaska Native villages, and the District of Columbia; and (2) funds to each State (for subsequent allocation to local governments) in accordance with a formula based on the State's need, general tax effort, and relative fiscal gap factors. Entitles local governments to a share of the State funds in accordance with a formula based on population, general tax effort, and relative income factors.

Eliminates provisions allowing State variation of local government allocations. Revises procedures for determining maximum and minimum limitations on local government entitlements.