Amends the Homeland Security Act of 2002 to allow up to 20 percent of a grant made to a State or local government for the purchase of equipment for homeland security or counterterrorism activities to be used for preparedness activities, including planning, training, and exercises.Amends the Robert T. Stafford Relief and Emergency Assistance Act to allow a State to use a grant made for a specific homeland security activity for another homeland security activity, if the alternative use is consistent with the State plan and approved by the President.