A bill to amend title I of the Elementary and Secondary Education Act of 1965 to permit the Secretary of Education to waive the requirements of subsections (c), (d), or (e) of section 126 of such Act in the case of any local educational agency which is participating in an experimental State program designed to consolidate State categorical educational programs in order to reduce the amount of time expended by State educational personnel for the administration of such programs and to increase local flexibility in the use of educational funds.

Amends the Elementary and Secondary Education Act of 1965 to authorize the Secretary of Education to waive specified requirements for the use of title I special educational needs funds by local educational agencies participating in experimental programs designed to consolidate State categorical educational programs. (Permits such waiver for any one of fiscal years 1982 through 1985, with possible renewal for an additional one-year period, for requirements that: (1) such Federal funds be used to supplement, not supplant, non-Federal funds for regular and certain special State and local programs; and (2) agencies receiving Federal assistance maintain, through use of non- Federal funds, services comparable to those provided by unassisted agencies.)

Allows State educational agencies of States desiring to carry out such experimental programs to submit to the Secretary, on behalf of local educational agencies desiring to participate in such program, an application for a waiver of such requirements. Prohibits the Secretary from approving any application unless it contains adequate assurances that under such program: (1) the special education needs of all pupils shall be effectively addressed, including the needs of educationally-disadvantaged children, children with limited English-speaking ability, migrant children, and handicapped children; and (2) the number of children to be served shall not exceed 15 percent of the total number of educationally-deprived children in the State who are served under title I of such Act.

Allows such waivers only for experimental programs under which the funding and administration of specified State categorical educational programs are consolidated (in whole or in part) in order to: (1) reduce the amount of time expended by educational personnel of the State for administrative aspects of State education programs; and (2) increase local flexibility in the use of educational funds while still satisfying the purposes of State and Federal educational policy.

Allows State educational agencies desiring to renew any such waiver for an additional one-year period to submit an application containing such assurances, together with additional information requested for the Secretary's evaluation of such program and the extent of compliance with such assurances for the first year.