    [Budget of the United States Government]
    [IV. Preparing For the 21st Century]
    [7. Strengthening the American Community]
    [From the U.S. Government Publishing Office, www.gpo.gov]

    [[Page 121]]

                    7.  STRENGTHENING THE AMERICAN COMMUNITY

      ----------------------------------------------------------------------

      We need to provide the same encouragement to invest in Appalachia, Native American reservations, the
    Mississippi Delta, and the inner cities that we provide today to invest in new markets overseas ... It's good
    for business, it's good for America's growth, and it's the right thing to do.

                                           President Clinton
                                          August 1999

      ----------------------------------------------------------------------
      President Clinton took office in 1993 determined to rebuild the
    American economy. In February of 2000, the economy is poised to enter
    the longest period of economic expansion in recorded history. For many
    Americans, the past seven years have meant opportunity and prosperity:
    more than twenty million new jobs have been created; real wages have
    continued to rise and the number of people who own homes has reached an
    all-time high. However, there are still some communities which have not
    been lifted up by this historic wave of economic expansion. In these
    areas, unemployment is still too high, economic development is still too
    weak, and the opportunity to build a better life is limited.
      Because the President believes that ``a Nation that lives as a
    community must value all its communities,'' he is committed to new and
    renewed efforts to promote an agenda of opportunity and responsibility
    and generate growth in these areas. The guiding principle is that the
    public sector can provide incentives to attract private sector
    investment, creating partnerships that tap the potential for growth,
    profit, and economic opportunity in distressed areas. Proposals to
    expand both the New Markets and the Empowerment Zone/Enterprise
    Community Initiatives serve as the centerpieces of this year's
    Administration efforts to foster the economic development of America's
    neediest communities.
      At the start of his first term, the President proposed, and worked
    with Congress to pass, legislation creating Empowerment Zones (EZs) and
    Enterprise Communities (ECs) to encourage private sector investments in
    underserved areas. These efforts also established the Community
    Development Financial Institutions Fund to build a network of
    institutions to facilitate lending, including mortgage financing to
    first-time home buyers and commercial loans to small businesses.
      The New Markets Initiative in its expanded form will leverage even
    more private sector investment as part of the President's overall
    community development effort. Using tax credits, loan guarantees,
    private investment institutions, universities, and technical expertise
    for small business, this initiative offers the potential to connect
    residents of distressed neighborhoods to the jobs and opportunities of
    the regional marketplace, and replace economic distress with
    opportunity.
      In addition to the New Markets Initiative, the Administration has been
    committed to strengthening America's communities through the Empowerment
    Zone/Enterprise Community Initiative. Along with more private
    investment, the Empowerment Zone/Enterprise Community Initiative has
    helped create thousands of jobs that are now filled by those who have
    traditionally lacked access to economic opportunity. The initiative has
    also provided job training and educational opportunities for nearly
    45,000 residents of EZs/ECs. Additionally, the program has helped create
    more affordable housing opportunities; allowed communities to address
    important public safety, infrastructure and environmental concerns;
    provided social services including affordable health care, child care,
    and youth development

    [[Page 122]]

    programs; and, encouraged investment in New Markets areas.
      Many Native American communities have not taken part in this wave of
    economic prosperity. High unemployment, lack of physical infrastructure,
    remote locations, and lack of access to technology all contribute to the
    challenges facing Indian Country. The Administration will work with
    Tribes, on a government-to-government basis, to help this generation and
    future generations of Native Americans receive greater opportunities.
    With these goals in mind, the budget includes significant funding
    increases for Native American communities in areas including health
    care, education, economic development, and law enforcement.

    Jobs and Economic Development

      The budget builds upon ongoing efforts to encourage economic growth in
    America's distressed communities through three complementary efforts:
    the New Markets Initiative; the EZ/EC program; and, the Community
    Development Financial Institutions Fund (CDFI).

      The New Markets Initiative: The New Markets Initiative, for which
    Congress expressed a measure of support last year by funding $39.5
    million (contingent upon authorization) of the Administration's request,
    is expanded to a total of $248 million. It includes three new elements:
    a $15 million microenterprise initiative for investments and support of
    microentrepreneurs, Program for Investment in Microentrepreneurs; a $5
    million university partnerships initiative; and, $30 million to make
    banking more affordable and accessible to low-income communities.
    Qualifying Tribes or Tribal consortia are eligible for these programs.
      The New Markets Tax Credit: To help spur $15 billion in new
              equity capital for a range of private investment vehicles
              serving distressed communities, a 25-percent tax credit is
              proposed, more than doubling last year's proposal, at a cost
              of $5 billion over 10 years. Eligible entities will include
              community development banks, community-oriented equity funds,
              and other new investment programs created by this initiative.
              A wide range of businesses can be financed by these investment
              funds, including inner-city shopping centers and retail
              stores, small technology firms, manufacturing facilities and
              incubators, and data management facilities.
      America's Private Investment Companies (APICs): APICs will
              encourage private investment in this country's untapped
              markets by providing loan guarantees to the debt issued by
              these funds, administered by the Department of Housing and
              Urban Development (HUD) in consultation with the Small
              Business Administration (SBA). Private investment companies
              that target portfolios of larger businesses relocating to or
              expanding in economically distressed inner-city and rural
              areas will be eligible for loan guarantees. To be licensed,
              APICs must raise a substantial amount of private capital
              managed by staff with a balance of experience in private
              investing and in community development. Last year, APICs
              received $20 million subject to enactment of authorizing
              legislation. The budget proposes $37 million.
      New Markets Venture Capital (NMVCs): New Markets Venture
              Capital Firms invest in smaller growth companies that can also
              benefit from expert management assistance. NMVCs match equity
              of private investors with Government-guaranteed debt and
              technical assistance funding to cultivate the growth of
              smaller firms. Last year, NMVCs received $15 million in
              appropriations. The budget proposes $52 million.
      Program for Investment in Microentrepreneurs (PRIME): This
              initiative will provide $15 million to provide technical
              assistance grants to microenterprise intermediaries to assist
              low-income and disadvantaged entrepreneurs. Microenterprises
              are very small businesses that typically have fewer than 10
              employees and generally lack access to conventional loans,
              equity, or other banking services.
      BusinessLINC: The Vice President, along with a number of
              CEO's, launched BusinessLINC in December 1998 to encourage
              learning, investment, networking, and collaboration between
              large and small businesses, in order to accelerate the

    [[Page 123]]

              growth of businesses in economically distressed areas. The
              budget proposes $6.6 million in additional funding for local
              BusinessLINC coalitions that match large and small firms, and
              provide supportive services. Of this amount, $1.25 million
              will be used to develop appropriate BusinessLINC connections
              in Indian Country.
      University Partnerships: Another new element of the New
              Markets Initiative includes $5 million, from HUD, for a pilot
              project to provide grants to 10 to 12 business and law schools
              to institutionalize their role in local economic development,
              through a range of activities including convening discussions
              on community needs, identifying local assets, formulating
              strategies, and organizing new efforts. In addition, these
              grants will be used by schools to foster business development
              and serve businesses and community development corporations in
              low- to moderate-income areas.
      Financial Services: The New Markets Initiative also includes
              $30 million to provide increased access to financial and
              banking services for the approximately 10 million unbanked
              households who do not have access to the mainstream banking
              system. The initiative will encourage the creation of low-cost
              bank accounts and the placement of Automated Teller Machines
              (ATMs) in post offices and other locations in low-income
              neighborhoods where access to ATMs is limited. It will also
              promote financial education for low-income families.

      Empowerment Zones (EZs)/Enterprise Communities (ECs): While the New
    Markets and CDFI programs address capital access and credit, the EZ/EC
    Initiative is the foundation of the Administration's empowerment agenda
    for communities with high unemployment and poverty rates. This
    initiative challenges qualified urban and rural areas to develop
    comprehensive strategic plans for revitalization, with input from
    residents and community partners. The program selects communities with
    the most innovative plans and significant local commitments.
      Investment in EZ/ECs is available in many forms. The Federal
    Government provides tax benefits for businesses and flexible grants to
    communities for job training, day care, and other purposes. EZ/ECs can
    apply for waivers from Federal regulations, enabling them to better
    address local needs. Special set-asides from Department of Agriculture
    rural development programs are also available to rural EZ/ECs.
      Round I EZ/ECs: Designated in 1994, these EZ/ECs are showing promising
    results. The Baltimore, MD, EZ, for instance, has created approximately
    2,860 new jobs as a result of Title XX funding and other leveraged
    investments, and 3,250 Zone residents have been placed directly into
    jobs through various work force placement partners. Through June 1999,
    Empower Baltimore Management Corporation (EBMC) has spent more than
    $18.4 million across four components of Baltimore's strategy: business
    development for job creation; work force development; quality of life,
    and, community-capacity building. The Kentucky Highlands Rural EZ has
    used its $11 million venture capital fund to assist 30 new businesses or
    business expansions, leveraging almost $66 million in capital that
    created 2,319 jobs and expects to create over 1,000 more in the next few
    years. Since this EZ was designated in December 1994, unemployment in
    the area has dropped by more than half.
      Round II and Round III EZ/ECs: In January 1999, the Administration
    designated a second round of 15 urban EZs, five rural EZs, and 20 rural
    ECs, selected on a competitive basis, from applications of more than 250
    communities. The budget proposes $1.4 billion in mandatory grant funding
    for the remaining nine years for urban EZs and $120 million for the
    remaining eight years for rural EZs, as the Administration proposed in
    1999 and 2000. These grants would allow communities to implement
    comprehensive long-term strategies to address their local needs.
      The budget also proposes a series of tax measures to extend and
    improve economic growth in the 31 existing Round I and Round II EZs and
    also proposes to create a Third Round of 10 new EZs (eight urban

    [[Page 124]]

    and two rural). The total cost of these tax expenditure proposals is
    approximately $4.4 billion over 10 years. To encourage employment and
    growth, the budget proposes to create and extend a 20-percent wage
    credit for all existing and proposed EZs through 2009 (under current
    law, only Round I EZs have the credit and it is scheduled to expire in
    2004.) To enhance the incentives for small businesses in EZs, the budget
    proposes to allow them to deduct an additional $35,000 in investments
    above the normal small business investment deductions. The proposal will
    also increase access to capital through tax exempt financing by allowing
    local governments to issue tax-exempt bonds on behalf of EZ businesses.
    The President's proposal would permanently extend the Brownfields Tax
    Incentive in EZs.

      Community Development Financial Institutions Fund (CDFI Fund):
    Complementing the New Markets Initiative and EZ/EC initiatives, the Fund
    uses the provision of Federal resources as the foundation for leveraging
    significant private sector resources. CDFIs include a broad range of
    institutions--community development banks, credit unions, venture
    capital funds, business loan funds, and microenterprise loan funds--that
    provide a wide range of products and services, such as mortgage
    financing to first-time home buyers, commercial loans for small
    businesses, and other basic financial services. By creating and
    expanding a diverse set of CDFIs, the Fund helps develop new private
    markets, create healthy local economies, promote entrepreneurship,
    restore neighborhoods, generate tax revenues, and empower residents in
    distressed urban and rural communities.
      Every CDFI that receives financial assistance from the Fund must
    provide at least a one-to-one match with funds from non-Federal sources.
    To date, the CDFI Fund has awarded over $215 million in financial and
    technical assistance to CDFIs. In addition, the Fund has awarded over
    $90 million to traditional banks and thrifts for increasing their
    activities in economically distressed communities and investing in
    CDFIs. The budget proposes $125 million for the CDFI Fund.
      Other programs that promote economic development and provide services
    to underserved families, individuals and markets include:
      HUD's Community Empowerment Fund (CEF): The CEF/EDI, working in tandem
    with the Section 108 loan guarantee program, will work with a new pilot
    program beginning in 2000 to create loan pools to improve the
    securitization of Section 108 loans.
      HUD's Continuum of Care: This program promotes comprehensive systems
    to address the needs of homeless individuals and families. The
    Administration proposes $1.2 billion in HUD homeless assistance, an
    increase of 18 percent over 2000. This funding level includes $105
    million for rental assistance vouchers to help the homeless move to
    permanent housing with supportive services. The Administration also
    proposes to expand access to mainstream health, social services, and
    employment programs for which the homeless may be eligible through a new
    $10 million program administered by the Department of Health and Human
    Services, States, and large counties. The initiative includes expanding
    access to Medicaid, State Children's Health Insurance Program, Temporary
    Assistance for Needy Families, Food Stamps, and services funded through
    the Mental Health and Substance Abuse Block Grant, Workforce Investment
    Act, and the Welfare-to-Work grant program.
      Department of Agriculture's (USDA) Rural Development Programs: Because
    their needs can vary widely, no single approach will help both urban and
    rural communities. The Administration once again proposes to give
    States, localities, and Tribes more flexibility in their use of USDA's
    Rural Development grants and loans for businesses, water and wastewater
    facilities, and community facilities such as day care centers and health
    clinics. The 1996 Farm Bill authorized this approach through a new Rural
    Community Advancement Program (RCAP), combining 12 separate USDA
    programs into a Performance Partnership that can tailor assistance to
    the unique economic development needs of each rural community. The
    budget proposes $3.4 billion in loans and grants for RCAP, 29 percent
    more than in 2000, and the full flexibility

    [[Page 125]]

    that the 1996 Farm Bill envisioned. It also reproposes Partnership
    Technical Assistance (PTA) grants to assist rural communities in
    developing strategic plans for economic development, and grants for
    early-warning weather systems in areas prone to tornadoes. As part of
    the Administration's multi-agency initiative for the Mississippi Delta
    Region (MDR), $2 million of the $7 million in PTA grants are targeted to
    MDR counties (the 219 counties of the region as defined by P.L. 100-
    460). In addition, there is a set-aside of $8 million in Intermediary
    Relending Program Loans for the MDR.
      Farm Safety Net proposal: Many rural communities depend significantly
    on the economic health of the farm sector. In addition to helping these
    communities diversify their economic base, through the New Markets and
    other economic and community development initiatives in the budget, the
    Administration is proposing an $11 billion package to enhance the farm
    safety net through 2002, when the next farm bill will be enacted (see
    Table 7-1).
      It has become painfully clear that the 1996 Farm Bill fails to support
    farm family incomes when prices fall or natural disasters strike. Even
    with $15 billion in emergency funding appropriated for distressed
    farmers and ranchers in the last two years, assistance remains
    inadequate because the 1996 Farm Bill is fundamentally flawed. While we
    cannot rewrite all farm policy this year, we can provide relief to those
    in need through the life of the current farm bill.
      The budget proposes to mend the farm safety net by providing counter-
    cyclical income assistance when crop prices are low, to make up a
    portion of farmers' lost revenue relative to a five-year average,
    freezing the USDA marketing loan rates for the 2000 crops at their 1999
    levels, and increasing Federal crop insurance subsidies so farmers are
    better protected from natural disaster losses.
      The budget also proposes major increases in USDA conservation
    programs, such as the new Conservation Security Program and the existing
    Conservation and Wetlands Reserve and Farmland Protection Programs,
    which would enable farm families to conserve and enhance environmentally
    sensitive farmland and protect their farms from urban and suburban
    sprawl while increasing farm income. To help diversify farm families'
    income sources, the budget also includes funding to enable farmer
    cooperatives to build commodity processing facilities that will channel
    value-added profits back to producers, and supports greater crop use for
    bioenergy production.
      ----------------------------------------------------------------------

                            Table 7-1.  $5.7 Billion Increase in 2001 for the Farm Safety Net
                                       (Mandatory funding, in millions of dollars)
    ----------------------------------------------------------------------------------------------------------------
                                                            Actual                          2001            Change:
                                                     --------------------   2000   ---------------------- Authorized
                                                                          Estimate  Authorized             Level to
                                                        1993      1999                 Level    Proposed   Proposed
    ----------------------------------------------------------------------------------------------------------------
    Proposed Authorizations:
    Crop insurance reform...........  BA                   868     1,674       742      1,759      2,669       +910
                                      OL                   726     1,588     1,967      2,015      2,560       +545
    Non-insured Crop Disaster         BA              ........        54       185         86        196       +110
     Assistance: Remove area-loss
     trigger........................
                                      OL              ........        54       185         86        196       +110
    Income assistance:
      Guarantee 92 percent of five-   BA              ........  ........  ........  ..........     2,464     +2,464
       year average \1\.............
                                      OL              ........  ........  ........  ..........     2,464     +2,464
      Extend dairy price-support      BA                   120       242       250        107        257       +150
       program to 2002..............
                                      OL                   120       242       250        107        257       +150
                                     -------------------------------------------------------------------------------
        Total, Income assistance....  BA                   120       242       250        107      2,721     +2,614
                                      OL                   120       242       250        107      2,721     +2,614

    Conservation programs \2\.......  BA              ........       335       355        246      1,409     +1,163
                                      OL              ........       323       417        300      1,124       +824

    Empowerment Zones/
      Enterprise Communities \3\....  BA              ........        15        15  ..........        15        +15
                                      OL              ........  ........         5  ..........  ........  ..........

    Cooperative development.........  BA              ........  ........  ........  ..........        80        +80
                                      OL              ........  ........  ........  ..........        80        +80
                                     -------------------------------------------------------------------------------
      Subtotal, Proposed              BA                   988     2,320     1,547      2,198      7,090     +4,892
       Authorizations.
                                      OL                   846     2,207     2,824      2,508      6,681     +4,173
    Existing Authorization:
    Marketing loan rates frozen.....  BA              ........  ........        20  ..........       500       +500
                                      OL              ........  ........        20  ..........       500       +500

    Bioenergy (ethanol) Incentive     BA              ........  ........       100  ..........       150       +150
     Payments:
                                      OL              ........  ........       100  ..........       150       +150
    Conservation Reserve Program
     (CRP):
    Continuous sign-up bonus........  BA              ........         2       110         13        138       +125
                                      OL              ........         2       110         13        138       +125

    Farm storage facility loans.....  BA              ........  ........  ........  ..........        10        +10
                                      OL              ........  ........  ........  ..........        10        +10
                                     -------------------------------------------------------------------------------
        Subtotal, Existing            BA              ........         2       210         13        798       +785
         Authorization.
                                      OL              ........         2       210         13        798       +785
                                     ===============================================================================
          Total, Farm Safety Net      BA                   988     2,322     1,796      2,211      7,888     +5,677
           Initiative...............
                                      OL                   846     2,209     3,059      2,521      7,479     +4,958
    ----------------------------------------------------------------------------------------------------------------
    \1\ The income assistance proposal would also generate $600 million in 2000 outlays.

    \2\ This initiative would also increase cumulative CRP enrollment to 40 million acres, allowing an additional
      1.2 million acres to sign up annually in 2001 through 2003. The first CRP payments for these additional acres
      would be made in 2002.

    \3\ 1999 and 2000 amounts are classified as discretionary spending.

      ----------------------------------------------------------------------
      Appalachian Regional Commission (ARC): The Administration continues
    support for ARC to help 406 economically distressed counties in the 13
    State Appalachian region. The ARC's Federal-State partnership is a
    proven economic development model of balanced fiscal decision-making
    that has helped improve the economic viability of this region over the
    past 35 years. Furthermore, the Administration is doubling the ARC's
    Entrepreneurship Initiative, which seeks to fund innovative economic
    development projects in the region, from $5 million to $10 million in
    2001, a significant increase to ARC's total funding of $71 million.
      Rural Alaskan Economic Development: The Denali Commission, which
    focuses on the economic development challenges of rural Alaska, will
    provide resources to improve the basic infrastructure of this region.
    Thirty million of new funding will address water and sewer and leaking
    fuel storage tanks in Alaska. Funds will also be used to create job
    training programs to provide the sustainable economic development
    opportunities for these remote Alaskan communities.
      Delta Regional Authority (DRA): The budget includes $153 million to
    create the new DRA to assist the Lower Mississippi Delta Region. This
    proposal includes $30 million in new resources to create this new
    authority. Modeled after other economic development agencies, the DRA
    will target its funding and resources to economically distressed
    counties throughout the Delta. The remaining $123 million will be
    targeted to these counties from existing programs at the Departments of
    Housing and Urban Development, Commerce, Transportation, Agriculture,
    Labor, Education, and Health and Human Services.
      Livable Communities Initiative: The Livability Communities initiative
    encourages the creation of livable communities and regions

    [[Page 126]]

    by aligning and dedicating new and existing Federal resources in support
    of locally determined livability initiatives. The programs included in
    the Livable Communities initiative will help accelerate and strengthen
    the development of regional capacities to address the problems of making
    America's metropolitan and rural areas good places to live, work, play
    and raise a family. The budget proposes

    [[Page 127]]

    four investments as part of the Livable Communities initiative.
      This initiative includes an unprecedented request for a $6.3 billion
    mass transit transportation initiative, a $1.6 billion congestion relief
    and air quality improvement program, $468 million for the Expanded
    Passenger Rail Fund, $719 million to implement the enhancements program;
    and, $52 million for the Transportation and Community and System
    Preservation pilot. In addition, the Better America Bonds program,
    administered by the Environmental Protection Agency, will provide
    Federal tax credit bonds enabling local, State and Tribal governments to
    issue $10.8 billion over five years for green space preservation, water
    quality enhancement, and clean up of abandoned industrial sites. HUD's
    $25 million Regional Connections Initiative will promote regional
    ``smart growth'' strategies and complement the Administration's other
    regional efforts. Regional Connections' matching grants will help local
    partnerships design and pursue smarter growth strategies across
    jurisdictional lines. As a part of the Livable Communities Initiative,
    the budget also proposes $125 million for the Department of Justice's
    Crime-Solving Technologies to improve community safety.
      Also included in the budget is the continuation of the Lands Legacy
    initiative, which will complement the Administration's Livable
    Communities initiative, by emphasizing land conservation; smart growth
    planning; and partnerships with State, local, and Tribal governments and
    non-profit groups to preserve open spaces in urban, suburban, rural, and
    coastal areas (see Chapter 4, ``Protecting the Environment''). This
    year's Lands Legacy initiative includes $50 million for the Interior
    Department's new State Planning Partnerships of which $30 million is for
    the Community/Federal Information Partnership (C/FIP). The funding will
    provide grants, contracts, technical assistance, information, and
    analytical tools to communities to manage resources and future growth
    while preserving environmentally sensitive land.
      The Administration is proposing a manufacturing initiative to assist
    industry, workers, and communities that have been adversely impacted in
    part by the slowdown in the Asian economy and other factors beyond their
    control. This initiative will double the funding for the Economic
    Development Administration's Economic Adjustment program to better
    assist communities that experience sudden and severe economic distress
    due to adverse global market conditions. It will provide the tools and
    resources to get direct technical assistance to communities in need, as
    have similar intensive, inter-agency efforts in the past which have
    successfully engaged industry, communities, and workers to address
    situations prompted by a downturn in economic conditions, like base
    closings. Additionally, the initiative will support efforts to promote
    the use of electronic commerce for trade promotion activities by large
    and small manufacturers. Increased funding of $15.5 million for the
    Department of Commerce will provide the resources to support enhanced
    trade compliance activities, by adding trade and compliance officers to
    monitor unfair trade practices and by reducing the time it takes to
    prepare dumping and countervailing duty cases. This enhanced monitoring
    and preparing trade cases in a quicker time frame will better provide
    effective relief to trade-injured industries and workers.

    Housing Needs of American Communities

      The Administration's efforts to create the National Partners in
    Homeownership--a coalition of 66 key public and private housing
    organizations--and to form a National Homeownership Strategy have led
    more families to homeownership than at any time in American history.
    Along with a strong economy and low interest rates, the Administration's
    policies have helped boost homeownership to 67 percent--a new all-time
    high. Under this Administration, 8.7 million Americans have become
    homeowners, including record numbers of minorities.
      The Administration's efforts to increase support for housing for low-
    income families resulted in an increase in 2000 of 60,000 new housing
    vouchers. The budget seeks to build on this progress and proposes to
    double the number of new housing vouchers, providing $690 million for
    120,000 new vouchers Nationwide.

    [[Page 128]]

      Federal Housing Administration (FHA): The Administration's successful
    1999 proposal to increase the FHA mortgage limit has allowed FHA to help
    50,000 more families purchase their first homes, especially large
    families and families in high cost areas. Building on this success, the
    budget proposes to further increase the FHA mortgage limit to allow an
    additional 55,000 families to purchase homes in 2001. The budget also
    authorizes FHA to offer new adjustable-rate mortgage (ARM) products,
    opening homeownership to more than 40,000 families in 2001. These new
    products will offer a sound mortgage product to borrowers who do not
    qualify for a fixed-rate mortgage or cannot afford fixed-rate pricing,
    but who want to avoid the volatility associated with traditional ARMs.
      Low-Income Housing Tax Credit (LIHTC): The budget proposes to expand
    the LIHTC to spur the private sector to develop more affordable low-
    income rental housing in high poverty areas. The proposal will cost $1.0
    billion over the next five years and help develop another 75,000 to
    90,000 units per year.
      Assisted Housing: The Administration proposes $690 million for 120,000
    housing vouchers, including 32,000 for families seeking to move from
    welfare to work, and 18,000 to help the homeless move to permanent
    housing with supportive services. Under the HUD Welfare-to-Work voucher
    program, local housing agencies that work in partnership with State and
    local welfare agencies will get the flexibility to design programs
    serving welfare families for whom housing assistance is critical to
    getting and retaining jobs. In addition, the budget continues to reduce
    poverty concentrations by providing $625 million in HOPE VI grants to
    local housing authorities to demolish approximately 28,000 dilapidated
    non-viable public housing units over the next three years, and replace
    them with portable subsidies or newly constructed mixed-income housing.
    These funds provide sufficient resources to surpass the Administration's
    goal of demolishing 100,000 of the most severely distressed units by
    2003.
      USDA's Rural Housing Service (RHS) offers direct and guaranteed loans
    and grants to help very low- to moderate-income rural residents buy and
    maintain adequate, affordable housing. One of the RHS goals is to reduce
    the number of rural residents living in substandard housing. The RHS
    direct loan program provides subsidized loans to very low and low-income
    rural residents. Its single family guaranteed loan program guarantees up
    to 90 percent of a private loan for buying new or existing housing.
    Together, the two programs will provide $5 billion in loans and loan
    guarantees in 2001, providing 68,000 decent, safe, affordable homes for
    rural Americans. This level of funding includes a legislative proposal
    increasing the single family housing guarantee program loan fee from one
    percent to two percent, which permits the Administration to provide
    higher loan levels at less cost.
      RHS's section 515 program, which generally lends to private
    developers, finances both the construction and rehabilitation of rural
    rental housing for low- to moderate-income, elderly, and handicapped
    rural residents. The budget provides $120 million in direct loans,
    providing over 1,400 new units for very low-income tenants in rural
    America. RHS also provides section 538 multifamily housing guaranteed
    loans, and the budget provides a loan level of $200 million, which funds
    3,200 new units for low to moderate income tenants. Additional
    multifamily housing funding includes $45 million in the farm labor
    housing program level--an increase of 20 percent over 2000--that serves
    almost 100 percent minority populations.
      In addition, the budget contains $20 million as a new set-aside within
    the HUD CDBG program in competitive grants for targeted technical
    assistance to increase the role of non-profit (including community-based
    and interfaith) organizations in supplying and maintaining affordable
    housing, creating economic opportunity, and participating in a wide
    range of HUD programs that assist low-income people in high poverty
    areas.

    New Opportunity Agenda through Volunteerism

      The budget includes numerous programs to narrow disparities and to
    increase economic opportunity in our Nation so that we may achieve the
    goal of strengthening the American community.

    [[Page 129]]

      National Service: The President has consistently supported and
    encouraged community service and volunteerism through such programs as
    AmeriCorps and other programs supported through the Corporation for
    National and Community Service. Volunteerism and community service have
    been a strong and important tradition in America ever since its
    founding. In 1994, President Clinton signed the King Holiday and Service
    Act making this national holiday a day of service to bring people
    together, promote racial cooperation, and help solve problems through
    citizen action.
      The Corporation for National and Community Service: This agency and
    its programs encourages Americans of all ages and backgrounds to help
    solve community problems and provides opportunities to engage in
    community-based service. The budget proposes $851 million for the
    Corporation, a 16-percent increase over 2000.
      AmeriCorps: Over 150,000 individuals will have participated in the
    Corporation's AmeriCorps in its first five years. The program helps
    young Americans of all backgrounds to serve in local communities through
    programs sponsored by local and national nonprofits. Participants serve
    full- or part-time, generally for at least a year. In return, they earn
    a minimum living allowance, set at about the poverty level of a single
    individual and, when they complete their service, they earn an education
    award to help pay for postsecondary education or repay student loans.
    Building upon the Administration's commitment to national service, the
    budget proposes to increase annual AmeriCorps participation to 100,000
    by 2004. As the first step on that path, the budget adds 9,000
    Americorps participants in 2001 for a total of 62,000. In addition, the
    budget provides $5 million for an AmeriCorps Reserves Program, modeled
    after the military reserves, to re-engage AmeriCorps alumni in service
    to their communities on weekends and in times of natural disasters.
      Service Opportunities for Youth: The budget includes $15.5 million in
    the Corporation for New Youth Initiatives, including $5 million for a
    Community Coaches program to increase service-learning opportunities for
    youth; $3 million for Youth Empowerment Grants to support youth-focused
    projects that solve problems in their communities, such as youth
    violence; and $7.5 million to support America's Promise: The Alliance
    for Youth to help all children grow into healthy, strong, and productive
    adults.
      The National Senior Service Corps: This Corporation program provides
    opportunities for citizens age 55 and older to use their time and
    talents to meet community needs. The budget includes $193 million for
    the Retired and Senior Volunteer Program, the Foster Grandparent
    Program, and the Senior Companion Program, enabling more than half a
    million older Americans to help others of all ages.

    From Digital Divide to Digital Opportunity

      Access to computers and the Internet and the ability to use this
    technology are becoming increasingly important for full participation in
    America's economic, political, and cultural life. In the face of strong
    evidence of a digital divide--a gap between those who have access to
    information technology and those who do not--the Administration proposes
    an initiative to help close the digital divide and ensure that every
    American benefits from the opportunities created by information
    technology.

      Community Technology Centers (CTCs): CTCs are designed to provide
    access to and training for information technology in a community-based
    setting within traditionally underserved areas. The budget provides $100
    million in 2001 to support the creation of up to 1,000 CTCs.
      Broadband Communities: Grants and loans to communities by the
    Department of Commerce's Economic Development Administration (EDA) and
    the USDA's Rural Utilities Service (RUS) will help ensure that
    underserved rural, urban, and Native American communities can build the
    infrastructure necessary to promote economic development through
    broadband (high-speed Internet) technology and electronic commerce. The
    Administration proposes $23 million for EDA to provide grants to
    distressed communities to plan for and install broadband infrastructure,
    and a RUS pilot program consisting of $2 million in grants and $100
    million in loans to finance

    [[Page 130]]

    installation of broadband transmission capacity to and through rural
    communities.
      Internet Home Access Program: The Administration proposes $50 million
    for a new grant program that would provide low-income individuals and
    families with connections, training, and support necessary for full
    participation in today's increasingly online society. The National
    Telecommunications and Information Administration within the Department
    of Commerce will encourage community-based partnerships between local
    organizations, academia, and private industry to devise solutions that
    address the needs of low-income populations in gaining access to
    technology and online resources at home. In order to demonstrate the
    local and private sector commitments, applicants will be required to
    provide matching funds.
      Technology Opportunities Program: Increased economic opportunity for
    all Americans hinges not only upon access to information technology
    tools but also upon content and applications that help empower low-
    income households and underserved communities. The budget proposes
    increasing funding for the Department of Commerce's Technology
    Opportunities Program (formerly the Telecommunications and Information
    Infrastructure Applications Program) to $45 million to expand its
    successful program of replicable, community-based grants into areas such
    as on-line support for microenterprise development and distance
    learning.
      ----------------------------------------------------------------------

                                          Public Television in the Digital Age

      The budget provides a total of $393 million for 2001 through 2003 for the public broadcasting system's
    transition to digital technology. Digital broadcasting will allow greatly expanded educational, community
    service, and cultural programming through innovative applications, including high-definition and interactive
    television. Funding through the Department of Commerce will be devoted to promoting digital transmission, while
    funding for the Corporation for Public Broadcasting will be for digital program production and development
    capabilities.

       ---------------------------------------------------------------------

    Civil Rights Enforcement

      The Administration is committed to expand efforts to help ensure that
    no American is denied a job, a home, or an education because of their
    race, ethnicity, gender, religion, or disability; we will help ensure
    equal opportunity for all Americans. The budget includes $698 million
    for funding civil rights enforcement agencies, an $81 million, or 13-
    percent, increase over the 2000 level of $617 million.
      The budget proposes a total of $322 million for the Equal Employment
    Opportunity Commission (a 15-percent increase) to support the agency's
    effort to reduce the backlog of private sector cases to 28,000 by the
    end of 2001; $98 million for the Department of Justice's Civil Rights
    Division (a 19-percent increase) to expand investigations and
    prosecutions of criminal civil rights cases (including hate crimes),
    promote compliance with the Americans with Disabilities Act and handle
    more police misconduct cases; $76 million for the Department of
    Education's Office of Civil Rights (a seven-percent increase) which
    includes funds to support staff training and technological improvements
    to ensure a viable civil rights compliance and enforcement program; $76
    million for the Department of Labor's Office of Federal Contract
    Compliance Programs (a four-percent increase) to continue the
    President's Equal Pay Initiative; and, $50 million for HUD's fair
    housing activities (a 14-percent increase) to reduce housing
    discrimination by working with public and private fair housing groups to
    assist in enforcement of the Fair Housing Act. Additionally, $21 million
    will be used by USDA to improve civil rights enforcement and program
    outreach to under-represented customers. (See Table 7-2 for the civil
    rights enforcement funding summary.) The budget also includes a $27
    million Equal Pay Initiative to educate employers and the public about
    wage issues, to provide training to women for non-traditional jobs, and
    to help employers assess and improve their pay policies.
      ----------------------------------------------------------------------

                  Table 7-2.  Civil Rights Enforcement Funding
                   (Budget authority, in millions of dollars)
    ------------------------------------------------------------------------
                                                                     Change:
                                        1999      2000      2001     2000 to
                                       Actual   Estimate  Proposed    2001
    ------------------------------------------------------------------------
    Department of Agriculture: Civil        16        18        21        +3
     Rights Programs................
    Department of Education: Office         66        71        76        +5
     for Civil Rights...............

    Department of Health and Human
     Services:
      Office for Civil Rights.......        21        22        24        +2

    Department of Housing and Urban
     Development:
      Fair Housing Activities.......        40        44        50        +6

    Department of Justice:
      Civil Rights Division.........        69        82        98       +16

    Department of Labor:
      Office of Federal Contract            65        73        76        +3
       Compliance Programs..........
      Civil Rights Center...........         5         6         6  ........
    Department of Transportation:            7         7         9        +2
     Office of Civil Rights.........
    Environmental Protection Agency:         4         4         5        +1
     Office of Civil Rights.........
    Commission on Civil Rights......         9         9        11        +2
    Equal Employment Opportunity           279       281       322       +41
     Commission.....................
                                     ---------------------------------------
        Total.......................       581       617       698       +81
    ------------------------------------------------------------------------

      ----------------------------------------------------------------------

    [[Page 131]]

    Commitment to Native Americans

      The relationship between the U.S. Government and Native Americans is a
    historical one founded on a trust responsibility. The Administration
    continues to honor its government-to-government relationship with Tribes
    by supporting critical programs serving Indian reservations, and by
    bringing together Tribal leaders and resources across the Government to
    address priority Tribal concerns, such as health care, education,
    economic development, infrastructure development, and other basic
    services. Within the total funding to address the unique relationship
    with Native Americans, the Administration includes a Government-wide
    initiative increase of $1.2 billion to address these crucial issues
    comprehensively and systematically. The Domestic Policy Council
    Interagency Work Group, chaired by the Interior Secretary, will
    coordinate agency efforts to implement the initiative.
      The budget reflects the Administration's commitment to Native
    Americans, proposing $9.4 billion, 14 percent more than in 2000 and 75
    percent over 1993, for Federal programs addressing basic Tribal needs
    and encouraging self-determination (see Table 7-3). The Health and Human
    Services Department's Indian Health Service (IHS) at $2.6 billion (10
    percent over 2000) and the Interior Department's Bureau of Indian
    Affairs (BIA) at $2.2 billion (18 percent over 2000) make up more than
    half of total Federal funding for Native American programs and services.
    In addition, BIA and IHS will continue to promote Tribal self-
    determination through local decision-making. Tribal contracting and
    self-governance compact agreements now represent 41 percent of BIA's
    operations budget, and over 42 percent of IHS' budget.
      ----------------------------------------------------------------------

                            Table 7-3.  Selected Components of the Native American Initiative
                                       (Budget authority, in millions of dollars)
    ----------------------------------------------------------------------------------------------------------------
                                                                Actual                             Change:   Change:
                                                         --------------------   2000      2001     1993 to   2000 to
                                                            1993      1999    Estimate  Proposed    2001      2001
    ----------------------------------------------------------------------------------------------------------------
    Health Care:
      Indian Health Service (IHS/HHS)...................     1,858     2,240     2,391     2,620      +762      +230
        IHS program level, including receipts...........     2,022     2,650     2,830     3,060    +1,038      +230

    Education:
      BIA School Construction, Repair, Maintenance (BIA/        90        60       133       300      +210      +167
       DOI).............................................
      School Construction For Public Schools Serving             4         5         5        55       +51       +50
       High Concentrations of Native Americans (Ed Dept)
      BIA School Operations (BIA/DOI)...................       343       476       467       507      +164       +40
      Indian Education Assistance for Public and BIA            82        66        77       116       +34       +39
       Schools Serving Native Americans (Ed Dept).......
      Support of Tribal Community Colleges (Multiagency)        24        44        52        67       +43       +15

    Economic Development:
      New Markets and Other Activities--Economic                 3         3         3        49       +46       +46
       Development Administration (Commerce)............
      Digital Opportunity and Other Activities (NSF)....  ........  ........  ........        10       +10       +10
      Small Business Development (SBA)..................  ........         *         *         6        +6        +6
      Community Development Financial Institutions        ........  ........  ........         5        +5        +5
       (Treasury).......................................
      Rural Community Advancement Program/RCAP (USDA)...  ........  ........        12        24       +24       +12
      Commercial Code Implementation and Other                  35        35        35        44        +9        +9
       Activities--Administration on Native Americans
       (HHS)............................................

    Infrastructure and Other Basic Services:
      Indian Reservation Roads and Bridges:
        Road/Bridge Construction (DOT)..................       202       284       250       375      +173      +125
         Road/Bridge Maintenance (BIA/DOI)..............        30        26        26        32        +2        +6

      Indian Housing:
        Housing and Urban Development...................       401       693       693       725      +324       +32
        Housing Improvement Program (BIA/DOI)...........        20        16        16        32       +12       +16

      Joint Indian Country Law Enforcement:
        Department of Justice...........................         4       182       195       279      +275       +84
         BIA/DOI........................................         9        98       141       157      +148       +16
                                                         -----------------------------------------------------------
          Subtotal, Law Enforcement.....................        13       280       336       439      +426      +103

      Capacity Building & Other Basic Services:
        Environmental Protection Agency.................        38       159       170       188      +150       +18
        Improved Trust Services (BIA/DOI)...............        85        74        73       108       +23       +35
        Operation of Indian Programs (BIA/DOI)..........     1,363     1,584     1,640     1,795      +432      +155
    ----------------------------------------------------------------------------------------------------------------
    Total Government-wide Funding for Native American        5,361     7,806     8,201     9,380    +4,019    +1,178
     Programs
    ----------------------------------------------------------------------------------------------------------------
    * $500 thousand or less.

      ----------------------------------------------------------------------
      The Government-wide initiative will substantially expand existing
    services and create new opportunities for Native Americans in four
    principal areas:
      Health Care: For IHS, the budget proposes an investment of
              $2.6 billion, a 10-percent increase over the 2000 level. This
              increase will enable IHS to continue expanding accessible and
              high-quality health care to its Native American service users,
              through IHS' existing network comprised of over 543 direct
              health care delivery facilities. This increase reflects a
              five-pronged approach for IHS: a substantial funding increase
              in 2001, better access to health grants, Medicare and Medicaid
              reimbursements, achievement of medical efficiencies by
              ensuring that health care procedures are done only when they
              are necessary and are done in a cost-effective manner,

    [[Page 132]]

              and vigilance on fraud and abuse. (Additional detail is
              provided in Chapter 3, ``Strengthening Health Care.'')
      The budget also supports access to health services and improves the
    health status of Native American by ensuring that IHS' health facilities
    are adequately maintained. Within the increase, IHS will continue the
    construction of the Navajo Fort Defiance (AZ) Hospital, the Parker
    Health (AZ) Clinic, and the Winnebago (NE) Hospital. In addition, the
    $30 million a year in diabetes-related funding that IHS receives under
    the Children's Health Insurance Program will help alleviate
    complications from diabetes.
      Education: The Administration is continuing its commitment to
              Native American education by systematically funding school
              repair and replacement needs on Indian reservations. The
              budget proposes

    [[Page 133]]

              $300 million (more than double the 2000 level) for BIA to fund
              the replacement of six elementary and secondary schools and
              numerous health and safety improvement and repair projects
              across Indian Country. Within BIA's school construction funds,
              up to $30 million may be used by Tribes or tribal consortia to
              defease the principal on bonds authorized under the
              Administration's school construction bonding proposal. In
              addition to school construction, BIA will provide $507 million
              (nine percent over 2000) for elementary and secondary school
              operations, early childhood development, and early
              intervention partnerships by establishing therapeutic pilots
              at six BIA boarding schools to provide students with services
              ranging from education to mental health and substance abuse
              treatment.
      The Education Department will provide $1.7 billion (eight percent over
    2000) in direct and indirect support for the education of Native
    Americans. This includes $116 million ($39 million over 2000) for the
    Indian Education program to fund grants to local educational agencies
    and continue the second year of in-service and pre-service training for
    the American Indian Teacher Corps initiative. This amount also provides
    $5 million for a new initiative, the American Indian Administrator
    Corps, that will support the recruitment, training, and in-service
    professional development of American Indian professionals to become
    effective school administrators in schools with high populations of
    Native American students. The Department will also set aside $50 million
    in its $1.3 billion national School Renovation initiative for public
    schools with high concentrations of Native American students and provide
    an additional $5 million for the schools under Impact Aid Construction.
      Across the Government, agencies contribute to Native American
    postsecondary education through financial support of Tribal colleges.
    For example, the Interior, Agriculture, Education, Housing and Urban
    Development, and Transportation Departments propose a total of $67
    million (29 percent over 2000) for activities related to curriculum
    development, student recruitment, student services, professor training,
    research capacity-building, and tribal outreach.
      Economic Development: The 2001 Budget proposes $54 million in
              Tribal funding (nearly nine times the 2000 level) for the
              Department of Commerce. In keeping with last year's efforts to
              expand New Markets to underserved areas, $49 million of the
              total amount will further the Economic Development
              Administration's infrastructure, planning, and public works
              projects on Indian Reservations. These projects will focus on
              technology, business development, and Tribal economic
              development activities.
      The Administration proposes a new initiative for Tribal colleges to
    encourage Native Americans to pursue information technology and other
    science and technology fields as areas of study, as well as to increase
    the capacity of these institutions to offer relevant courses. The budget
    provides $10 million, to be administered by the National Science
    Foundation, for course and program development, and for teacher
    professional development activities at feeder schools.
      The budget also proposes $6 million for the Small Business
    Administration (SBA) to fund the Office of Native American Affairs and
    to establish two initiatives for improving economic development on
    reservations: BusinessLinc and Native American Small Business
    Development Centers (SBDC). The SBA will expand the successful
    BusinessLINC program to Indian Country by establishing mentor/protege
    relationships between large and small businesses. In addition, the
    budget proposes new funding to expand the SBDC program into Indian
    Country to provide business and technical assistance to Native American
    entrepreneurs. A set-aside of $5 million from the Treasury Department's
    Community Development Financial Institutions Fund will also be used to
    promote New Markets on reservations by establishing a training and
    technical assistance program addressing human capital development needs
    in Indian Country.
      The budget includes $229 million (16 percent over 2000) for
    Agriculture Department programs serving Indian reservations, of which
    $26 million ($14 million over 2000) is targeted

    [[Page 134]]

    to Tribes through Rural Community Advancement Program (RCAP) and other
    economic development activities. This funding will provide low-interest
    loans and grants to construct and improve Tribal water and wastewater
    systems, and community facilities like health clinics and child care
    centers on Indian reservations, and to diversify and expand economic
    opportunities.
      In addition, the Health and Human Services Department's Administration
    on Native Americans will allocate $2 million of its $9 million increase
    over 2000 to support additional efforts to develop Tribal legal codes.
    This funding will support Tribal efforts to develop environmental and
    tax codes, as well as codes addressing the areas of business,
    commercial, zoning, land use, hunting, fishing, and juvenile and child
    welfare.
      Infrastructure and Other Services: The Department of
              Transportation's (DOT) 2001 proposed level of $375 million (50
              percent over 2000) will improve roads, bridges, highway safety
              and transportation services on Indian reservations. Within
              this total, $349 million for the Indian Reservation Roads
              Program, (a 50-percent increase over 2000) will allow Tribes
              to address the estimated backlog of $4 billion in needs on
              these roads and bridges. In addition, a $5 million set-aside
              for Indian tribes within DOT's Access program will increase
              mobility and access to employment opportunities on
              reservations. To ensure that Native Americans have the skills
              to compete for transportation jobs, $1 million will be
              dedicated for construction skills training. In addition, total
              funding to improve highway safety on Indian reservation roads
              will double with an additional $1 million.
      Of the BIA's total funds, $32 million (20 percent over 2000) will be
    used to supplement DOT's funds by maintaining BIA and Tribal roads on
    reservations across the country, and $32 million (more than twice the
    2000 level) will be used to repair or replace dilapidated homes across
    Indian Country, to prevent family displacement.
      The budget includes $725 million (five percent over 2000) in HUD to
    enable Tribes and Tribal housing entities to create affordable rental
    and homeownership opportunities, as well as develop the regulatory and
    legal framework necessary to facilitate economic revitalization and
    homeownership on Tribal lands. The budget establishes a new information
    hotline for Government-wide Native American programs funded out of the
    Indian Community Development Block Grant program.
      The third year of the Interior and Justice Departments' joint law
    enforcement initiative, for which the budget proposes $439 million in
    2001 (31 percent over 2000), will continue to address high crime rates
    in Indian Country by providing more resources for officer hiring and
    retention, drug control and youth crime prevention programs, law
    enforcement equipment, construction of detention facilities, and crime
    reporting surveys.
      The Environmental Protection Agency (EPA) will continue to provide
    technical assistance to Tribes on such activities as hazardous and solid
    waste removal, leaking underground storage tanks, and water protection.
    The budget increases the Tribal share of the Clean Water State Revolving
    Fund appropriation from 0.5 to 1.5 percent. Part of EPA's proposed $188
    million Tribal budget would also be used for increased Tribal general
    assistance grants to build institutional capacity for implementing
    Tribal environmental programs on Indian lands.
      The Administration is committed to improving trust services and
    management through its trust reform efforts at the Interior Department.
    The budget proposes $108 million (48 percent over 2000) for improved
    trust services in the BIA, for activities such as probate, real estate
    appraisals and other services, and cadastral surveys.
      In addition, the Administration is committed to resolving disputed
    Indian trust fund account balances through informal dispute resolution
    and supports the unique government-to-government relationship that
    exists in Indian trust land management issues. After Tribal
    consultations, BIA submitted its recommendations to Congress in November
    1997. Legislation reflecting these recommendations was proposed in 1998,
    but not enacted. The Department will continue efforts to resolve trust
    fund account balances.

    [[Page 135]]

      The budget provides $83 million for the Interior Department's (DOI's)
    Office of Special Trustee, including the trust management improvement
    project. Current activities include verifying the remaining individual
    Indian account data and converting these data to a commercial-grade
    accounting system. Ownership, lease, and royalty information related to
    the underlying trust assets will also be verified and converted to a
    recently acquired commercial asset management system.
      As part of DOI's commitment to resolving trust land management issues,
    DOI worked with Congress in 1999 to repropose legislation to establish
    an Indian Land Consolidation program to address the ownership
    fractionation of Indian land. DOI began implementing three pilot
    projects in Wisconsin, in cooperation with Tribes, to purchase small
    ownership interests in highly fractionated tracts of land from willing
    sellers. In the nine months of this effort, more than 8,000 small
    ownership interests have been consolidated. The budget proposes $13
    million in 2001 for this program and DOI will work with Congress to get
    legislation enacted in the 106th Congress, limiting future
    fractionation.

    Firefighter Health and Safety Initiative

      Firefighters play a critical role in protecting the health and safety
    of the community, and in order to further protect their own health and
    safety, the Administration is proposing a new $25 million pilot grant
    program that will assist needy communities in obtaining necessary health
    and safety equipment for their firefighting personnel. This program,
    administered by the Federal Emergency Management Agency, will help
    communities reduce firefighter injuries and fatalities, and improve
    their ability to effectively respond to fire emergencies.

    Commitment to the District of Columbia

      The Administration strongly supports the District of Columbia's right
    of self-governance and continues to work with the District to promote
    economic well-being and to advance the interests of the District. As
    part of the 1997 balanced budget agreement, the President proposed, and
    Congress enacted, a comprehensive financial restructuring plan for the
    District of Columbia. It relieved the District of major financial
    burdens and laid the groundwork to restore the District's fiscal health.
    Due to prudent fiscal management and on-going efforts to build private
    investment, the District--facing bankruptcy only six years ago--produced
    budget surpluses in 1997 and 1998 and projects a third budget surplus in
    1999. To maintain a balanced budget in the future, the District has
    launched major management reforms, cut spending, and directed a portion
    of budget surpluses to eliminate its accumulated deficit by 2000. If the
    District continues to balance its budget through 2000, it can regain
    full home-rule.
      The budget includes $486 million to implement the President's plan for
    District courts and corrections, including $224 million to house the
    District's sentenced felon population. By December 2001, all adult-
    sentenced felons will be in the custody of the Federal Bureau of
    Prisons.
      The Administration--through its departments and agencies--will
    continue to provide technical help and other assistance to the District
    in such areas as education and law enforcement. In addition, the
    Administration continues to assist the District in spurring neighborhood
    revitalization and economic development and in bolstering the District's
    long-term fiscal stability. In 2000, the Federal Government provided $17
    million to launch a college tuition program for District residents. This
    budget proposes to continue to fund the program at $17 million.
      For 2001, the budget provides $38 million for economic development and
    infrastructure investments, including $10 million for environmental
    remediation and site preparation of property to be used in an
    economically distressed neighborhood slated for economic development, $3
    million for the study and designs for a National Museum of American
    Music, and $25 million for the Federal share of construction of a
    Metrorail station at the intersection of New York and Florida Avenues,
    in Northeast DC. This $25 million will be matched by city and private
    funds to create an improved gateway into the Nation's Capital and
    revitalize the distressed neighborhoods surrounding the Metrorail site.

    [[Page 136]]

      ----------------------------------------------------------------------

                                        Building One America for the 21st Century

    The President's vision of One America in the 21st Century is a diverse, democratic community in which we respect
     and celebrate our differences, while embracing the shared values that unite us. The President envisions an
     America based on opportunity for all, responsibility from all, and one community of all Americans. To reach
     that goal, he has asked all Americans to join him in a national effort to deal openly and honestly with our
     racial differences. Americans must improve their understanding of the history of race, and how this history
     contributes to conflicting views on race and racial progress held by Americans of color and white Americans.
     The President recognizes that, even as America rapidly becomes a truly multi-racial democracy, race relations
     remains an issue that too often divides our Nation and keeps the American dream from becoming a reality for
     everyone who seeks to take part through hard-work and responsibility.

    In February 1999, the President established his Initiative for One America, the first White House office
     dedicated to ensuring a coordinated and focused strategy to close the opportunity gap that exists for many
     minorities and the underserved. The One America office builds on the important work done by the President's
     Initiative on Race in 1997 and 1998 by promoting the President's goals of educating the American public about
     race; encouraging racial reconciliation through a national dialogue on race; identifying policies that can
     expand opportunities for racial and ethnic minorities; and ensuring common access to health care and the broad
     enforcement of laws against discrimination. The Initiative for One America coordinates the work of the White
     House and Federal agencies to carry out the President's vision of One America and partners with non-government
     entities to increase private sector commitment, investment and action to increase opportunity.

    The One America Initiative has hosted discussions and public forums on diversity and opportunity to a wide range
     of organizations, educational institutions, and communities all across the country. For example, it launched
     the Presidential Call to Action to the American Legal Community in a joint effort with Department of Justice
     officials and professionals to implement a nationwide strategic plan to increase opportunity and promote racial
     diversity in the legal profession. It also worked with the Department of Education to promote a Campus Days
     Dialogue program to discuss a variety of educational challenges and the importance of faculty leadership on the
     issue of diversity. This year, 620 educational institutions participated in the Campus Dialogue program. The
     Initiative also worked with local elected officials and advocacy organizations to develop a proactive strategy
     to address the sometimes volatile relationship between communities of color and law enforcement agencies.

     The Administration has made progress in a range of program areas, including those listed below. Many others are
     listed throughout the budget.

    For example:
       Eliminating Racial and Ethnic Disparities in Health. In February 1998, the President committed the
       Nation to an ambitious goal by the year 2010: eliminate disparities in six health areas where racial and
       ethnic minorities are disproportionately affected, while continuing the progress we have made in improving
       the overall health of the American people. As a key part of this effort, the budget includes $35 million, a
       17-percent increase over 2000, for demonstration projects (begun in 1999) to better address racial
       disparities in health.

      ----------------------------------------------------------------------

    [[Page 137]]

      ----------------------------------------------------------------------

                                  Building One America for the 21st Century--Continued

       Closing the Education Opportunity Gap. Increases in funding for major education initiatives,
       including school construction and class size reduction, will significantly benefit minority groups. Other
       targeted programs also receive generous funding increases, including a $823 million increase in the Hispanic
       Education Action Plan and a $20 million increase in funding for Historically Black Colleges and Universities.

    As these efforts continue, many other programs included by the President in the budget and described in these
     chapters will advance these goals to realize the potential of One America in the 21st Century.

      ----------------------------------------------------------------------