under subpart 1 of part E of title I of the Omnibus Crime Control and Safe Streets Act of 1968 ( 42 U.S.C. 3750 et seq.). (c) Obligation of States A State that receives a grant award under subpart 1 of part E of title I of the Omnibus Crime Control and Safe Streets Act of 1968 ( 42 U.S.C. 3750 et seq.), which does not reduce a subgrant award made under such grant to a unit of local government in its jurisdiction in accordance with this section, shall, in the succeeding fiscal year, receive only 50 percent of the grant award that would have otherwise been awarded to that State under such subpart. (d) Reallocation Any funds withheld from a State or unit of local government from a direct grant award by the Attorney General shall be reallocated in accordance with subpart 1 of part E of title I of the Omnibus Crime Control and Safe Streets Act of 1968 ( 42 U.S.C. 3750 et seq.). 1061. Exemptions The provisions of section 3 shall not apply in the case of any unit of local government— (1) that serves a population of less than 15,000 people and so certifies to the Attorney General