[Congressional Record Volume 143, Number 17 (Tuesday, February 11, 1997)]
[Senate]
[Pages S1233-S1234]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. FEINGOLD (for himself and Mr. Kohl):
  S. 300. A bill to prohibit the use of certain assistance provided 
under the Housing and Community Development Act of 1974 to encourage 
plant closings and the resultant relocation of employment, and for 
other purposes; to the Committee on Banking, Housing, and Urban 
Affairs.


        The Prohibition of Incentives for Relocation Act of 1997

 Mr. FEINGOLD. Mr. President, I introduce legislation to 
address an important and timely issue for the citizens of my State of 
Wisconsin, and for others all over our Nation--the issue of job piracy.
  Last month, officials in the State of Michigan announced a new 
initiative designed to lure businesses from other States into their own 
borders. Businesses are provided a tempting incentive to relocate 
there, tax-free status for 15 years, if they relocate to select regions 
of the State. The communications director for the Michigan Jobs 
Commission, Jim Tobin, was quoted in the Wisconsin State Journal as 
saying that the new so-called renaissance zones program ``will 
aggressively pursue Wisconsin companies for relocation into Michigan.'' 
Presumably, other States bordering Michigan will be targeted as well.
  I was extremely disappointed to hear that my neighboring State had 
chosen to blatantly target Wisconsin jobs, rather than focusing its 
energies on creating new jobs for its residents. In my opinion, 
economic development ought not be thought of as a zero-sum game. We 
live in an era of increasing economic interdependence, and responsible 
elected officials should be focusing on regional and national solutions 
to the crises in our States' most economically distressed areas, not on 
raiding each others' jobs.
  Upon hearing of the new Michigan initiative, my colleagues Senator 
Kohl and Congressman Tom Barrett and I requested investigations from 
several Federal agencies in order to ascertain whether and to what 
degree Federal funds are being used to finance the renaissance zones 
initiative. We feel strongly that our constituents' tax dollars should 
not have to help finance the efforts of those across State lines who 
attempt to steal their jobs.
  Fortunately, most Federal economic development grant programs, such 
as those funded by the Small Business Administration and the Economic 
Development Administration, currently include antipiracy language. 
However,

[[Page S1234]]

this important anti-piracy provision is conspicuously absent in the 
Community Development Block Grant [CDBG] Program and several other 
small programs administered by the Department of Housing and Urban 
Developmen [HUD].
  Today, Senator Kohl and I are introducing the Prohibition of 
Incentives for Relocation Act of 1997, a bill we have introduced 
previously, in both the 103d and 104th Congresses. It would simply make 
the CDBG, HUD special purpose grants, and HUD economic development 
grants consistent with other domestic economic development grant 
programs, by prohibiting HUD funds from being used for activities that 
are intended, or likely to facilitate, the closing of an industrial or 
commercial plant, or the substantial reduction of operations of a 
plant; and result in the relocation or expansion of a plant from one 
area to another area. Identical legislation is being introduced in the 
House by Representative Barrett and Representative Kleczka.
  We became aware of this problem in the way the CDBG language is 
currently drafted several years ago. In 1994, Briggs and Stratton, one 
of Wisconsin's major employers, announced that its Milwaukee plant 
would be closing. As a result, over 2,000 jobs at the plant were lost. 
The total economic impact on the community was even worse: For every 
four Briggs jobs lost, an estimated one additional job from a supplier 
or other business that relied on Briggs was lost.
  At the same time as the Milwaukee closing, Briggs and Stratton 
expanded two of its plants in other States. I do not dispute its right 
to do so. But what I find objectionable, Mr. President, is that Federal 
dollars, CDBG funds, were used to facilitate the transfer of these jobs 
from one State to another. This was, in my opinion, a completely 
inappropriate use of Federal funds. The Community Development Block 
Grant Program is designed to expand employment opportunities and 
economic growth, not simply move jobs from one community to another. 
There is no way to justify to my constituents that they are sending 
their tax dollars to Washington to be distributed to other States in 
order to attract jobs out of our State, leaving behind communities 
whose economic stability has been destroyed.
  Mr. President, it is not clear if CDBG dollars are being used by the 
State of Michigan to finance their piracy of jobs from my State and 
from our other Midwestern neighbors. But in any event, the statute 
should be revised to prohibit such usage. It is an issue of fairness, 
and it deserves our attention. I ask unanimous consent that the text of 
the bill be printed in the Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                 S. 300

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

     SECTION 1. PROHIBITION OF USE OF CERTAIN ASSISTANCE TO 
                   ENCOURAGE PLANT CLOSINGS AND RESULTANT 
                   RELOCATION OF EMPLOYMENT.

       (a) Authorizations.--Section 103 of the Housing and 
     Community Development Act of 1974 (42 U.S.C. 5303) is 
     amended--
       (1) by inserting ``(a)'' before ``The Secretary''; and
       (2) by adding at the end the following new subsection:
       ``(b) Prohibition of Use of Assistance to Encourage Plant 
     Closings and Resultant Relocation of Employment.--
       ``(1) In general.--Notwithstanding any other provision of 
     law, no amount from a grant made under section 106 shall be 
     used for any activity that is intended or is likely to--
       ``(A) facilitate the closing of an industrial or commercial 
     plant or the substantial reduction of operations of a plant; 
     and
       ``(B) result in the relocation or expansion of a plant from 
     one area to another area.
       ``(2) Notice.--The Secretary shall, by notice published in 
     the Federal Register, establish such requirements as may be 
     necessary to implement this subsection. Such notice shall be 
     published as a proposed regulation and take effect upon 
     publication. The Secretary shall issue final regulations, 
     taking into account public comments received by the 
     Secretary.''.
       (b) Special Purpose Grants.--Section 107 of the Housing and 
     Community Development Act of 1974 (42 U.S.C. 5307) is amended 
     by adding at the end the following new subsection:
       ``(g) Prohibition of Use of Assistance To Encourage Plant 
     Closings and Resultant Relocation of Employment.--
       ``(1) In general.--Notwithstanding any other provision of 
     law, no amount from a grant made under this section shall be 
     used for any activity that is intended or is likely to--
       ``(A) facilitate the closing of an industrial or commercial 
     plant or the substantial reduction of operations of a plant; 
     and
       ``(B) result in the relocation or expansion of a plant from 
     one area to another area.
       ``(2) Notice.--The Secretary shall, by notice published in 
     the Federal Register, establish such requirements as may be 
     necessary to implement this subsection. Such notice shall be 
     published as a proposed regulation and take effect upon 
     publication. The Secretary shall issue final regulations, 
     taking into account public comments received by the 
     Secretary.''.
       ``(c) Economic Development Grants.--Section 108(q) of the 
     Housing and Community Development Act of 1974 (42 U.S.C. 
     5308(q)) is amended by adding at the end the following new 
     paragraph:
       ``(5) Prohibition of use of assistance to encourage plant 
     closings and resultant relocation of employment.--
       ``(A) In general.--Notwithstanding any other provision of 
     law, no amount from a grant made under this subsection shall 
     be used for any activity that is intended or is likely to--
       ``(i) facilitate the closing of an industrial or commercial 
     plant or the substantial reduction of operations of a plant; 
     and
       ``(ii) result in the relocation or expansion of a plant 
     from one area to another area.
       ``(B) Notice.--The Secretary shall, by notice published in 
     the Federal Register, establish such requirements as may be 
     necessary to implement this paragraph. Such notice shall be 
     published as a proposed regulation and take effect upon 
     publication. The Secretary shall issue final regulations, 
     taking into account public comments received by the 
     Secretary.''.
                                 ______