[Budget of the United States Government]
[VI. Investing in the Common Good: Program Performance in Federal Functions]
[21. Community and Regional Development]
[From the U.S. Government Publishing Office, www.gpo.gov]
21. COMMUNITY AND REGIONAL DEVELOPMENT
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Table 21-1. FEDERAL RESOURCES IN SUPPORT OF COMMUNITY AND REGIONAL DEVELOPMENT
(In millions of dollars)
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Estimate
Function 450 1998 -----------------------------------------------------------
Actual 1999 2000 2001 2002 2003 2004
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Spending:
Discretionary Budget Authority.......... 10,263 8,884 8,902 8,902 8,902 8,902 8,902
Mandatory Outlays:
Existing law.......................... -407 -477 -602 -701 -734 -761 -815
Proposed legislation.................. ........ ........ 29 116 194 223 231
Credit Activity:
Direct loan disbursements............... 1,502 2,402 2,085 N/A N/A N/A N/A
Guaranteed loans........................ 1,427 2,165 3,144 N/A N/A N/A N/A
Tax Expenditures:
Existing law............................ 1,150 1,275 1,365 1,290 1,210 1,090 1,080
Proposed legislation.................... ........ ........ 12 195 376 465 543
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N/A = Not available
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Federal support for community and regional development helps build the
Nation's economy, and helps economically distressed urban and rural
communities secure a larger share of America's prosperity. The Federal
Government spends over $10 billion a year, and offers about $1.4 billion
in tax incentives to help States and localities create jobs and economic
opportunity, and build infrastructure to support commercial and
industrial development.
Federal programs have stabilized and revitalized many of these
communities allowing them to expand their economic base and support
their citizens, particularly those in need. Communities hard hit by
natural disasters receive Federal assistance to rebuild infrastructure,
businesses, and homes. States and localities also use these Federal
funds to leverage private resources for their community revitalization
strategies.
Department of Housing and Urban Development (HUD)
HUD provides communities with funds to promote commercial and
industrial development, enhance infrastructure, and develop strategies
for providing affordable housing close to jobs.
Community Development Block Grants (CDBG) provide funds for various
community development activities directed primarily at low-and moderate-
income persons. CDBG funds go to improving housing, public works and
services, promoting economic development, and acquiring or clearing
land. Seventy percent of CDBG funds go to over 950 central cities and
urban counties, and the remaining 30 percent go to States to award to
smaller localities. The Indian CDBG program focuses mainly on public
infrastructure, community facilities, and economic development.
HUD's HOME program (which is described in the Income Security
function) supports construction of new housing, rehabilitation of
existing homes, acquisition of standard housing, assistance to home
buyers, and assistance for tenant-based rental.
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The 2000 goals for the CDBG and HOME programs include:
Increasing the number of CDBG grantees who incorporate
milestones with timetables in Consolidated Plans that can help
demonstrate progress in improving locally defined conditions
in their neighborhoods and communities;
Developing a standardized HUD assessment of consolidated
plans;
Assisting 108,000 households and assisting 95,000 newly
constructed units of affordable housing through HOME, helping
to increase to 72 percent the number of worst case housing
need households receiving Federal assistance;
Providing housing assistance to almost 210,000 households
though the CDBG program.
By the end of 2000, HUD will establish baseline measures against which
to judge the contributions these programs make to community development
and affordable housing.
Empowerment Zones (EZs) provide tax incentives and grants to carry out
10-year, community-wide strategic plans to revitalize designated areas.
In 1994, the Administration designated nine EZs, two Supplemental EZs
(which were designated full EZs in 1998) and 95 Empowerment Communities
(ECs). These original EZs and related ECs have begun leveraging private
investment, expanding affordable housing and homeownership
opportunities, and helping create jobs. In December 1998, the
Administration selected 15 new urban Zones and five new rural Zones
(administered by the Agriculture Department) from more than 268
distressed areas that applied for new designations. These Zones, along
with the 20 new rural ECs were selected in January 1999, and will begin
implementing their comprehensive strategies to redevelop their areas.
The 2000 goals for the EZ and EC program include:
Increase to 95 percent the share of urban EZs and ECs that
show satisfactory progress toward locally defined benchmarks,
as measured by the tracking system.
Department of Commerce
The Economic Development Administration (EDA) provides assistance to
communities to help build capacity and address long-term economic
challenges through its nationwide program delivery network. EDA's public
works grants help build or expand public facilities to stimulate
industrial and commercial growth, such as industrial parks, business
incubators, access roads, water and sewer lines, and port and terminal
developments. EDA, working with State and local governments and the
private sector, has completed a total of 8,570 projects, creating or
retaining over 783,000 private sector jobs, invested over $4.9 billion
in grants, and generated over $49.5 billion in private investment.
Between 1992 and 1998, EDA awarded 1,208 public works grants, totaling
$1.2 billion, to economically distressed communities to build these
types of infrastructure projects.
EDA's revolving loan fund (RLF) program enhances communities' capacity
to invest in locally identified commercial development that creates
jobs. Since 1976, when the RLF program was implemented, EDA has provided
initial capital for over 550 local RLFs.
These funds have made more than 7,200 loans to private businesses and
have leveraged more than $1.9 billion in private capital that upon
repayment has tended to stay in the community for re-lending and further
economic development activity.
The 2000 goals for EDA include:
Creation or retention of a total of 66,753 jobs.
Department of the Treasury
The Community Development Financial Institutions (CDFI) Fund seeks to
promote economic revitalization and community development in distressed
areas by increasing the availability of capital and leveraging private
sector funds. The CDFI Fund provides financial and technical assistance
to a diverse set of specialized, private, for-profit and nonprofit
financial institutions known as community development financial
institutions. CDFIs
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have a primary mission of community development and include community
development banks, credit unions, loan funds, venture capital funds, and
microenterprise loan funds.
The 2000 goals for the CDFI Fund include:
Increasing the diversity of CDFIs that receive assistance so
that all 50 States have at least one CDFI awardee; and
Increasing the number of CDFIs that receive assistance to 135
from an estimated 125 in 1999.
Department of Agriculture (USDA)
USDA gives financial assistance to rural communities and businesses to
boost employment and further diversify the rural economy. The Rural
Community Advancement Program's grants, loans, and loan guarantees help
build rural community facilities, such as health clinics and day care
centers, and create or expand rural businesses. USDA also provides loans
through the Intermediary Relending Program (IRP), which provides funds
to an intermediary such as a State or local government that, in turn,
provides funds for economic and community development projects in rural
areas.
The 2000 goals for these USDA programs include:
Creating 100,000 new jobs, compared to 82,000 in 1998,
through the Business and Industry loans, IRP, and community
facilities programs.
Department of the Interior
The Interior Department's Bureau of Indian Affairs (BIA) helps Tribes
manage and generate revenues from mineral, agricultural and forestry
resources. BIA also promotes Tribal and individual self-sufficiency by
developing Tribal resources and obtaining capital investments. The
Department of the Interior (DOI) is partnering with the Department of
Commerce, the Small Business Administration and Tribal governments to
fulfill the Administration's directive to develop a strategic plan and
coordinate existing public and private sector economic development
initiatives. BIA and the Department of Justice seek to lower crime rates
on the 56 million acres of Indian lands that are held in trust for
tribes by DOI, through the expansion of its joint law enforcement
initiative begun in 1998. BIA maintains over 7,000 buildings, including
185 schools and 3,000 housing units; over 100 high-hazard dams; and
(with the Transportation Department and State and local governments)
about 50,000 miles of roads and 745 bridges. Finally the Department will
strengthen its trust services program by facilitating more prudent land
management and maintaining about 150 Tribal resource management plans,
projects, co-management programs, and fishing access sites; supporting
15 irrigation projects; managing 46 million acres for farming and
grazing; completing the first phase of a comprehensive environmental
audit; and funding 20 water rights negotiation teams.
The 2000 goals for DOI include:
Generating nearly $60 million in federally-guaranteed
commercial loans on reservations. These loans, supported by a
$5 million appropriation, will foster growth and development
in Indian country;
Reducing crime rates on Indian lands by increasing the number
of police officers from 1.3 per 1,000 citizens, which is
currently just over half the national average;
Replacing at least two of BIA's oldest, most dilapidated
schools, making major improvements and repairs to additional
schools (including a joint demonstration project with the
Department of Energy utilizing energy-efficient construction
materials), and about 430 minor improvement projects. In
addition, BIA will provide financial assitance to Tribes for
participating in the Administration's school modernization
initiative; and
Obtaining about $250 million in timber sales revenue by
helping Tribes manage 16 million acres of forest land.
Tennessee Valley Authority (TVA)
TVA operates integrated navigation, flood control, water supply, and
recreation programs. Along with TVA's electric power program, these
programs contribute to the economic prosperity of the seven-State region
it serves. In 2000, TVA plans to pay for most of these programs in a new
way,
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using proceeds from the agency's $6.8 billion power program, user fees
and sources other than appropriations. The budget proposes
appropriations of $7 million for TVA to manage the Land Between The
Lakes National Recreation Area.
The 2000 goals for TVA include:
Maximizing the number of days the Tennessee River is open to
commercial navigation from Knoxville, Tennessee to Paducah,
Kentucky, with a 2000 performance target of full availability
93 percent of the time; and
Minimizing flood damage by operating the river system with
flood control as a priority, and maintaining a 2000 target of
80 percent of flood storage availability.
Appalachian Regional Commission (ARC)
ARC targets its resources to highly distressed areas, focusing on
critical development issues on a regional scale, and making strategic
investments that encourage other Federal, State, local and private
participation and dollars. From 1988 to 1996, Appalachian employment
grew at the national rate of 10.6 percent.
The 2000 goals for ARC include:
5,000 people will retain or get jobs;
18,000 households will have access to new or improved water,
sewerage and waste management systems;
7,000 people will benefit from business development services;
and
140 physicians will be placed in the region's health
professional shortage areas to provide another 700,000 patient
office visits a year.
Disaster Relief and Insurance
The Federal Government provides financial help to cover a large share
of the Nation's losses from natural disasters. Over the last five years,
the two major Federal disaster assistance programs--the Federal
Emergency Management Agency's (FEMA) Disaster Relief Fund and the Small
Business Administration's (SBA) Disaster Loan program--have provided
over $24.9 billion in emergency assistance. The Federal Government
shares the costs with States for infrastructure rebuilding; makes
disaster loans on uninsured losses to individuals and businesses; and
provides grants for emergency needs and housing assistance, unemployment
assistance, and crisis counseling.
In addition to its post disaster response activities, FEMA is working
to establish 100 ``disaster resistant communities'' in each State by the
end of 1999. In exchange for offering the only source of flood insurance
available to property owners, participating communities must mitigate
future losses by adopting and enforcing floodplain management measures
that protect lives and new construction from flooding. FEMA is also
modernizing its inventory of floodplain maps, and will be taking
measures to mitigate properties experiencing repetitive flood damages.
The 2000 goals for FEMA include:
Processing disaster declarations within eight days, making 50
percent of funding for emergency work projects available to
States within 30 days of application approval, making 80
percent of public assistance funding determination within an
average of 180 days, and closing 90 percent of disasters in
the Public Assistance Program within two years of the
declaration date; and
increasing the number of flood insurance policies in force by
five percent per year, on average.
The 2000 goals for the SBA Disaster Loan Program include:
Increasing the number of disaster loan applications processed
within 21 days of receipt from 77 percent in 1998 to 80
percent; and
Establishing an effective field presence (being able to
accept disaster loan applications) within three days of a
disaster, for 98 percent of declared events.
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Tax Expenditures
The Federal Government provides tax incentives to encourage community
and regional development activities, including: (1) tax-exempt bonds for
airports, docks, high-speed rail facilities, and sports and convention
facilities (costing $3.6 billion from 2000 to 2004); (2) tax incentives
for qualifying businesses in economically distressed areas that qualify
as Empowerment Zones--including an employer wage credit, higher up-front
deductions for investments in equipment, tax-exempt financing, and
accelerated depreciation--as well as capital gains preferences for
certain investments in the District of Columbia and incentives for
first-time buyers of a principal residence in the District (costing $1.9
billion over the five years); (3) a 10-percent investment tax credit for
rehabilitating buildings that were built before 1936 for non-residential
purposes (costing $150 million over the five years); (4) tax exemptions
for qualifying mutual and cooperative telephone and electric companies
(costing $135 million over the five years); and (5) up-front deductions
of environmental remediation costs at qualified sites (costing $135
million over the five years).