[Congressional Bills 105th Congress]
[From the U.S. Government Publishing Office]
[H.R. 1639 Introduced in House (IH)]







105th CONGRESS
  1st Session
                                H. R. 1639

  To establish an education development block grant program to allow 
 local educational agencies to use such funds and to borrow five times 
       the amount of such funds to repair school infrastructure.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                              May 15, 1997

  Ms. Waters (for herself, Mr. Cummings, Mr. Hilliard, Mr. Jackson of 
Illinois, Ms. Jackson-Lee of Texas, Ms. McKinney, Mrs. Meek of Florida, 
Mr. Thompson, Ms. Brown of Florida, Mr. Rush, Mr. Towns, Mr. Dixon, Mr. 
    Stokes, Mr. Conyers, Mr. Dellums, Mr. Rangel, Mrs. Clayton, Ms. 
 Kilpatrick, Mr. Clyburn, Mr. Ford, Mr. Davis of Illinois, Mr. Owens, 
   Mr. Watt of North Carolina, Mr. Wynn, Mr. Scott, Mr. Hastings of 
 Florida, Ms. Christian-Green, Ms. Carson, Ms. Norton, Mr. Payne, Mr. 
 Clay, Mr. Jefferson, Ms. Eddie Bernice Johnson of Texas, Mr. Fattah, 
   Mr. Lewis of Georgia, and Ms. Millender-McDonald) introduced the 
 following bill; which was referred to the Committee on Education and 
                             the Workforce

_______________________________________________________________________

                                 A BILL


 
  To establish an education development block grant program to allow 
 local educational agencies to use such funds and to borrow five times 
       the amount of such funds to repair school infrastructure.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Education Development Block Grant 
Act of 1997''.

SEC. 2. TABLE OF CONTENTS.

Sec. 1. Short title.
Sec. 2. Table of contents.
Sec. 3. Definitions.
              TITLE I--BLOCK GRANTS AND GRANT REQUIREMENTS

Sec. 101. Block grants.
Sec. 102. Education plans.
Sec. 103. Review of plans.
Sec. 104. Regulations.
Sec. 105. Authorization of appropriations.
                 TITLE II--ALLOCATION OF GRANT AMOUNTS

Sec. 201. Annual allocation.
              TITLE III--FEDERAL GUARANTEES FOR FINANCING

Sec. 301. Authority and requirements.
Sec. 302. Security and repayment.
Sec. 303. Payment of interest.
Sec. 304. Training and information.
Sec. 305. Limitations on amount of guarantees.

SEC. 3. DEFINITIONS.

    (a) Local Bond Authority.--The term ``local bond authority'' 
means--
            (1) a local educational agency with authority to issue a 
        bond for construction or renovation of educational facilities 
        in a local area; and
            (2) a political subdivision of a State with authority to 
        issue such a bond for an area including a local area.
    (b) Secretary.--The term ``Secretary'' means the Secretary of 
Education.
    (c) State.--The term ``State'' means each of the several States of 
the United States, the District of Columbia, and the Commonwealth of 
Puerto Rico.

              TITLE I--BLOCK GRANTS AND GRANT REQUIREMENTS

SEC. 101. BLOCK GRANTS.

    (a) Authority.--For each of fiscal years 1998 through 2001, the 
Secretary shall (to the extent amounts are made available to carry out 
this Act) make grants under this section to a local bond authority to 
allow such authority to repair its school infrastructure.
    (b) Plan Requirement.--
            (1) In general.--The Secretary may make a grant under this 
        Act to a local bond authority for a fiscal year only if--
                    (A) the local bond authority has submitted to the 
                Secretary an education plan for such fiscal year under 
                section 102; and
                    (B) the plan has been determined under section 103 
                to comply with the requirements of section 102.
            (2) Waiver.--The Secretary may waive the applicability of 
        the requirements under paragraph (1), in whole or in part, if 
        the Secretary finds that a local bond authority has not 
        complied or cannot comply with such requirements due to 
        circumstances beyond the control of the authority.
    (c) Administrative Expenses.--The Secretary shall, by regulation, 
authorize each recipient to use not more that 5 percent of any grant 
amounts received under this Act for any reasonable administrative 
costs.

SEC. 102. EDUCATION PLANS.

    (a) Plan Submission.--The Secretary shall provide for each local 
bond authority to submit an education plan as described in subsections 
(b) and (c).
    (b) 4-Year Plan.--Each education plan under this section shall be 
in a form prescribed by the Secretary and shall contain, with respect 
to the 4-year period beginning with the fiscal year for which the plan 
is submitted, the following information:
    (c) 1-Year Plan.--An education plan under this section for a local 
bond authority shall be in a form prescribed by the Secretary and 
contain the following information relating to the upcoming fiscal year 
for which the assistance under this Act is to be made available:

SEC. 103. REVIEW OF PLANS.

    (a) Review and Notice.--
            (1) Review.--The Secretary shall conduct a limited review 
        of each education plan submitted to the Secretary to ensure 
        that the plan complies with the requirements of section 102. 
        The Secretary shall have the discretion to review a plan only 
to the extent that the Secretary considers review is necessary.
            (2) Notice.--The Secretary shall notify each local bond 
        authority for which a plan is submitted whether the plan 
        complies with such requirements not later than 60 days after 
        receiving the plan. If the Secretary does not notify the local 
        bond authority, as required under this subsection and 
        subsection (b), the plan shall be considered, for purposes of 
        this Act, to have been determined to comply with the 
        requirements under section 102 and the local bond authority 
        shall be considered to have been notified of compliance upon 
        the expiration of such 60-day period.
    (b) Notice of Reasons for Determination of Noncompliance.--If the 
Secretary determines that a plan, as submitted, does not comply with 
the requirements under section 102, the Secretary shall specify in the 
notice under subsection (a) the reasons for the noncompliance and any 
modifications necessary for the plan to meet the requirements under 
section 102.
    (c) Review.--After submission of the education plan or any 
amendment or modification to the plan to the Secretary, to the extent 
that the Secretary considers such action to be necessary to make 
determinations under this subsection, the Secretary shall review the 
plan (including any amendments or modifications thereto) to determine 
whether the contents of the plan--
            (1) set forth the information required by section 102 to be 
        contained in an education plan;
            (2) are consistent with information and data available to 
        the Secretary; and
            (3) are prohibited by or inconsistent with any provision of 
        this Act or other applicable law.
If the Secretary determines that any of the appropriate certifications 
required under section 102 are not included in the plan, the plan shall 
be deemed to be incomplete.
    (d) Updates to Plan.--After a plan under section 102 has been 
submitted for a local bond authority for any fiscal year, the local 
bond authority may comply with the provisions of such section for any 
succeeding fiscal year (with respect to information included for the 4-
year period under section 102(b) or the 1-year period under section 
102(c)) by submitting only such information regarding such changes as 
may be necessary to update the plan previously submitted.
    (e) Effective Date.--This section and section 102 shall take effect 
on the date provided by the Secretary.

SEC. 104. REGULATIONS.

    Not later than 90 days after the date of the enactment of this Act, 
the Secretary shall, by notice issued in the Federal Register, 
establish any requirements necessary to implement this Act.

SEC. 105. AUTHORIZATION OF APPROPRIATIONS.

    There are authorized to be appropriated for grants under this title 
$2,000,000,000 for each of fiscal years 1998, 1999, 2000, and 2001.

                 TITLE II--ALLOCATION OF GRANT AMOUNTS

SEC. 201. ANNUAL ALLOCATION.

    For each fiscal year, the Secretary shall allocate any amounts made 
available for assistance under this Act for the fiscal year, in 
accordance with the provisions of part A of title I of the Elementary 
and Secondary Education Act of 1965.

              TITLE III--FEDERAL GUARANTEES FOR FINANCING

SEC. 301. AUTHORITY AND REQUIREMENTS.

    (a) Authority.--To such extent or in such amounts as provided in 
appropriations Acts, the Secretary may, subject to the limitations of 
this title and upon such terms and conditions as the Secretary may 
prescribe, guarantee and make commitments to guarantee, the notes or 
other obligations issued by local bond authorities, for the purposes of 
financing repairs to school infrastructure.
    (b) Lack of Financing Elsewhere.--A guarantee under this title may 
be used to assist a local bond authority in obtaining financing only if 
the local bond authority has made efforts to obtain such financing 
without the use of such guarantee and cannot complete such financing 
consistent with the timely execution of the program plans without such 
guarantee.
    (c) Terms of Loans.--Notes or other obligations guaranteed pursuant 
to this title shall be in such form and denominations, have such 
maturities, and be subject to such conditions as may be prescribed by 
regulations issued by the Secretary. The Secretary may not deny a 
guarantee under this title on the basis of the proposed repayment 
period for the note or other obligation, unless the period is more than 
20 years or the Secretary determines that the period causes the 
guarantee to constitute an unacceptable financial risk.
    (d) Limitation on Outstanding Guarantees.--No guarantee or 
commitment to guarantee shall be made with respect to any note or other 
obligation if the total outstanding notes or obligations of the issuer 
guaranteed under this title (excluding any amount defeased under the 
contract entered into under section 302(a)(1)) would thereby exceed an 
amount equal to 5 times the amount of the grant approval for the issuer 
pursuant to title III.

SEC. 302. SECURITY AND REPAYMENT.

    (a) Requirements on Issuer.--To assure the repayment of notes or 
other obligations and charges incurred under this title and as a 
condition for receiving such guarantees, the Secretary shall require 
the local bond authority issuing such notes or obligations to--
            (1) enter into a contract, in a form acceptable to the 
        Secretary, for repayment of notes or other obligations 
        guaranteed under this title;
            (2) pledge any grant for which the issuer may become 
        eligible under this Act;
            (3) demonstrate that the extent of such issuance and 
        guarantee under this title is within the financial capacity of 
        the local bond authority and is not likely to impair the 
        ability to use grant amounts under title I; and
            (4) furnish, at the discretion of the Secretary, such other 
        security as may be deemed appropriate by the Secretary in 
        making such guarantees.
    (b) Repayment From Grant Amounts.--Notwithstanding any other 
provision of this Act--
            (1) the Secretary may apply grants pledged pursuant to 
        subsection (a)(2) to any repayments due the United States as a 
        result of such guarantees; and
            (2) grants allocated under this Act for a local bond 
        authority may be used to pay principal and interest due 
        (including such servicing, underwriting, and other costs as may 
        be specified in regulations issued by the Secretary) on notes 
        or other obligations guaranteed pursuant to this title.
    (c) Full Faith and Credit.--The full faith and credit of the United 
States is pledged to the payment of all guarantees made under this 
title. Any such guarantee made by the Secretary shall be conclusive 
evidence of the eligibility of the obligations for such guarantee with 
respect to principal and interest, and the validity of any such 
guarantee so made shall be incontestable in the hands of a holder of 
the guaranteed obligations.

SEC. 303. PAYMENT OF INTEREST.

    The Secretary may make, and contract to make, grants, in such 
amounts as may be approved in appropriations Acts, to or on behalf of a 
local bond authority issuing notes or other obligations guaranteed 
under this title, to cover not to exceed 30 percent of the net interest 
cost (including such servicing, underwriting, or other costs as may be 
specified in regulations of the Secretary) to the borrowing entity or 
agency of such obligations. The Secretary may also, to the extent 
approved in appropriations Acts, assist the issuer of a note or other 
obligation guaranteed under this title in the payment of all or a 
portion of the principal and interest amount due under the note or 
other obligation, if the Secretary determines that the issuer is unable 
to pay the amount because of circumstances of extreme hardship beyond 
the control of the issuer.

SEC. 304. TRAINING AND INFORMATION.

    The Secretary, in cooperation with eligible public entities, shall 
carry out training and information activities with respect to the 
guarantee program under this title.

SEC. 305. LIMITATIONS ON AMOUNT OF GUARANTEES.

    (a) Aggregate Fiscal Year Limitation.--Notwithstanding any other 
provision of law and subject only to the absence of qualified 
applicants or proposed activities and to the authority provided in this 
title, to the extent approved or provided in appropriations Acts, the 
Secretary may enter into commitments to guarantee notes and obligations 
under this title.
    (b) Authorization of Appropriations for Credit Subsidy.--There are 
authorized to be appropriated to cover the costs (as such term is 
defined in section 502 of the Congressional Budget Act of 1974) of 
guarantees under this title such sums as may be necessary for each of 
fiscal years 1998, 1999, 2000, and 2001.
    (c) Fiscal Year Limitations.--The Secretary shall monitor the use 
of guarantees under this title by local bond authorities. If necessary, 
the Secretary may impose limitations on the amount of guarantees any 
one local bond authority may receive in any fiscal year.
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