[Congressional Record Volume 143, Number 119 (Wednesday, September 10, 1997)]
[Senate]
[Pages S9081-S9085]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




               THE EDUCATIONAL FACILITIES IMPROVEMENT ACT

  Mr. DASCHLE. Mr. President, today I am introducing with my colleague 
from Illinois, Senator Moseley-Braun, a bill to help local communities 
expand schools that are overcrowded, and repair or replace schools that 
are crumbling, or obsolete.
  As you know, the Labor-HHS Appropriations bill that we are currently 
considering on the floor includes $100 million for school construction 
and repair. This is an important step toward addressing what is a real 
and growing problem in this country.
  The bill we are introducing today, the Educational Facilities 
Improvement Act, provides an additional $1.9 billion over the next 5 
years. It represents the second installment in our efforts to upgrade 
the school buildings America's children attend.
  Communities can use the money to underwrite a part of the interest 
costs on school construction projects. In so doing, they will be using 
these dollars to leverage additional resources from other sources.
  This is an urgent priority. All over the country, children are 
returning to schools this month that are crowded or obsolete --even 
dangerous. Children are being taught in trailers. Some school yards 
have so many trailers outside that you can't tell if it's a playground 
or a trailer court.
  We need to address this problem now, not next year, not sometime in 
the future. This is why we are using rule 14 to skip the normal 
committee process and bring our bill directly on the Senate calendar. 
We hope our Republican colleagues will join the call for an early vote 
on this critical issue.
  We don't need committee hearings to know what the problem is. The 
GAO, the non-partisan Government Accounting Office, has already 
documented the problem. They say it will take $112 billion to bring all 
of America's schools up to par.
  We obviously can't commit that many federal dollars. And we 
shouldn't. Public education has always been--and should remain--first 
and foremost a local responsibility.
  But the sheer size of the problem requires that the Federal 
Government be a partner. We can't put America's educational house in 
order while our schools themselves are falling down. Students can't 
learn in classrooms that

[[Page S9082]]

are crowded and buildings that are crumbling. And most local 
communities can't afford to foot the whole school construction bill 
themselves. Our bill will help communities begin to fix the most urgent 
of the problems.
  I urge my colleagues to support this important legislation. I ask 
unanimous consent that the bill and summary be included in the Record.
  There being no objection, the items were ordered to be printed in the 
Record, as follows:

                                S. 1160

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

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Educational Facilities 
     Improvement Act''.

     SEC. 2. PROVISION OF ASSISTANCE FOR CONSTRUCTION AND 
                   RENOVATION OF EDUCATIONAL FACILITIES.

       Title XII of the Elementary and Secondary Education Act of 
     1965 (20 U.S.C. 8501 et seq.) is amended--
       (1) by repealing sections 12002 and 12003;
       (2) by redesignating sections 12001 and 12004 through 
     12013, as sections 12101 and 12102 through 12111, 
     respectively;
       (3) by inserting after the title heading the following:

     ``SEC. 12001. FINDINGS.

       ``The Congress finds the following:
       ``(1) The General Accounting Office performed a 
     comprehensive survey of the Nation's public elementary and 
     secondary school facilities, and found severe levels of 
     disrepair in all areas of the United States.
       ``(2) The General Accounting Office concluded more than 
     14,000,000 children attend schools in need of extensive 
     repair or replacement. Seven million children attend schools 
     with life safety code violations. Twelve million children 
     attend schools with leaky roofs.
       ``(3) The General Accounting Office found the problem of 
     crumbling schools transcends demographic and geographic 
     boundaries. At 38 percent of urban schools, 30 percent of 
     rural schools, and 29 percent of suburban schools, at least 
     one building is in need of extensive repair or should be 
     completely replaced.
       ``(4) The condition of school facilities has a direct 
     affect on the safety of students and teachers, and on the 
     ability of students to learn.
       ``(5) Academic research has proven a direct correlation 
     between the condition of school facilities and student 
     achievement. At Georgetown University, researchers found 
     students assigned to schools in poor condition can be 
     expected to fall 10.9 percentage points below those in 
     buildings in excellent condition. Similar studies have 
     demonstrated up to a 20 percent improvement in test scores 
     when students were moved from a poor facility to a new 
     facility.
       ``(6) The General Accounting Office found most schools are 
     not prepared to incorporate modern technology into the 
     classroom. Forty-six percent of schools lack adequate 
     electrical wiring to support the full-scale use of 
     technology. More than a third of schools lack the requisite 
     electrical power. Fifty-six percent of schools have 
     insufficient phone lines for modems.
       ``(7) The Department of Education reported that elementary 
     and secondary school enrollment, already at a record high 
     level, will continue to grow during the period between 1996 
     and 2000, and that in order to accommodate this growth, the 
     United States will need to build an additional 6,000 schools 
     over this time period.
       ``(8) The General Accounting Office found it will cost 
     $112,000,000,000 just to bring schools up to good, overall 
     condition, not including the cost of modernizing schools so 
     the schools can utilize 21st century technology, nor 
     including the cost of expansion to meet record enrollment 
     levels.
       ``(9) State and local financing mechanisms have proven 
     inadequate to meet the challenges facing today's aging school 
     facilities. Large numbers of local educational agencies have 
     difficulties securing financing for school facility 
     improvement.
       ``(10) The Federal Government can support elementary and 
     secondary school facilities, and can leverage additional 
     funds for the improvement of elementary and secondary school 
     facilities.

     ``SEC. 12002. PURPOSE.

       ``The purpose of this title is to help State and local 
     authorities improve the quality of education at their public 
     schools through the provision of Federal funds to enable the 
     State and local authorities to meet the cost associated with 
     the improvement of school facilities within their 
     jurisdictions.

     ``PART A--GENERAL INFRASTRUCTURE IMPROVEMENT GRANT PROGRAM'';

     and
       (4) by adding at the end the following:

       ``PART B--CONSTRUCTION AND RENOVATION BOND SUBSIDY PROGRAM

     ``SEC. 12201. DEFINITIONS.

       ``As used in this part:
       ``(1) Educational facility.--The term `educational 
     facility' has the meaning given the term `school' in section 
     12110.
       ``(2) Local area.--The term `local area' means the 
     geographic area served by a local educational agency.
       ``(3) Local bond authority.--The term `local bond 
     authority' means--
       ``(A) a local educational agency with authority to issue a 
     bond for construction or renovation of educational facilities 
     in a local area; and
       ``(B) a political subdivision of a State with authority to 
     issue such a bond for an area including a local area.
       ``(4) Poverty line.--The term `poverty line' means the 
     official poverty line (as defined by the Office of Management 
     and Budget, and revised annually in accordance with section 
     673(2) of the Omnibus Budget Reconciliation Act of 1981 (42 
     U.S.C. 9902(2))) applicable to a family of the size involved.
       ``(5) State.--The term `State' means each of the several 
     States of the United States, the District of Columbia, and 
     the Commonwealth of Puerto Rico.

     ``SEC. 12202. AUTHORIZATION OF PROGRAM.

       ``(a) Program Authority.--Of the amount appropriated under 
     section 12210 for a fiscal year and not reserved under 
     subsection (b), the Secretary shall use--
       ``(1) 33 percent of such amount to award grants to local 
     bond authorities for not more than 125 eligible local areas 
     as provided for under section 12203; and
       ``(2) 67 percent of such amount to award grants to States 
     as provided for under section 12204.
       ``(b) Special Rule.--The Secretary may reserve--
       ``(1) not more than 1.5 percent of the amount appropriated 
     under section 12210 to provide assistance to Indian schools 
     in accordance with the purpose of this title;
       ``(2) not more than 0.5 percent of the amount appropriated 
     under section 12210 to provide assistance to Guam, the United 
     States Virgin Islands, American Samoa, the Commonwealth of 
     the Northern Mariana Islands, the Republic of the Marshall 
     Islands, the Federated States of Micronesia, and the Republic 
     of Palau to carry out the purpose of this title; and
       ``(3) not more than 0.1 percent of the amount appropriated 
     under section 12210 to carry out section 12209.

     ``SEC. 12203. DIRECT GRANTS TO LOCAL BOND AUTHORITIES.

       ``(a) In General.--The Secretary shall award a grant under 
     section 12202(a)(1) to eligible local bond authorities to 
     provide assistance for construction or renovation of 
     educational facilities in a local area.
       ``(b) Use of Funds.--The local bond authority shall use 
     amounts received through a grant made under section 
     12202(a)(1) to pay a portion of the interest costs applicable 
     to any local bond issued to finance an activity described in 
     section 12205 with respect to the local area.
       ``(c) Eligibility and Determination.--
       ``(1) Eligibility.--To be eligible to receive a grant under 
     section 12202(a)(1) for a local area, a local bond authority 
     shall demonstrate the capacity to issue a bond for an area 
     that includes 1 of the 125 local areas for which the 
     Secretary has made a determination under paragraph (2).
       ``(2) Determination.--
       ``(A) Mandatory.--The Secretary shall make a determination 
     of the 100 local areas that have the highest numbers of 
     children who are--
       ``(i) aged 5 to 17, inclusive; and
       ``(ii) members of families with incomes that do not exceed 
     100 percent of the poverty line.
       ``(B) Discretionary.--The Secretary may make a 
     determination of 25 local areas, for which the Secretary has 
     not made a determination under subparagraph (A), that have 
     extraordinary needs for construction or renovation of 
     educational facilities that the local bond authority serving 
     the local area is unable to meet.
       ``(d) Application.--To be eligible to receive a grant under 
     section 12202(a)(1), a local bond authority shall prepare and 
     submit to the Secretary an application at such time, in such 
     manner, and containing such information as the Secretary may 
     require, including--
       ``(1) an assurance that the application was developed in 
     consultation with parents and classroom teachers;
       ``(2) information sufficient to enable the Secretary to 
     make a determination under subsection (c)(2) with respect to 
     such local authority;
       ``(3) a description of the architectural, civil, 
     structural, mechanical, or electrical construction or 
     renovation to be supported with the assistance provided under 
     this part;
       ``(4) a cost estimate of the proposed construction or 
     renovation;
       ``(5) an identification of other resources, such as unused 
     bonding capacity, that are available to carry out the 
     activities for which assistance is requested under this part;
       ``(6) a description of how activities supported with funds 
     provided under this part will promote energy conservation; 
     and
       ``(7) such other information and assurances as the 
     Secretary may require.
       ``(e) Award of Grants.--
       ``(1) In general.--In awarding grants under section 
     12202(a)(1), the Secretary shall give preference to a local 
     bond authority based on--
       ``(A) the extent to which the local educational agency 
     serving the local area involved or the educational facility 
     for which the authority seeks a grant (as appropriate) meets 
     the criteria described in section 12103(a);
       ``(B) the extent to which the educational facility is 
     overcrowded; and
       ``(C) the extent to which assistance provided through the 
     grant will be used to fund

[[Page S9083]]

     construction or renovation that, but for receipt of the 
     grant, would not otherwise be possible to undertake.
       ``(2) Amount of assistance.--
       ``(A) In general.--In determining the amount of assistance 
     for which local bond authorities are eligible under section 
     12202(a)(1), the Secretary shall--
       ``(i) give preference to a local bond authority based on 
     the criteria specified in paragraph (1); and
       ``(ii) consider--

       ``(I) the amount of the cost estimate contained in the 
     application of the local bond authority under subsection 
     (d)(4);
       ``(II) the relative size of the local area several by the 
     local bond authority; and
       ``(III) any other factors determined to be appropriate by 
     the Secretary.

       ``(B) Maximum amount of assistance.--A local bond authority 
     shall be eligible for assistance under section 12202(a)(1) in 
     an amount that does not exceed the appropriate percentage 
     under section 12204(f)(3) of the interest costs applicable to 
     any local bond issued to finance an activity described in 
     section 12205 with respect to the local area involved.

     ``SEC. 12204. GRANTS TO STATES.

       ``(a) In General.--The Secretary shall award a grant under 
     section 12202(a)(2) to each eligible State to provide 
     assistance to the State, or local bond authorities in the 
     State, for construction and renovation of educational 
     facilities in local areas.
       ``(b) Use of Funds.--The State shall use amounts received 
     through a grant made under section 12202(a)(2)--
       ``(1) to pay a portion of the interest costs applicable to 
     any State bond issued to finance an activity described in 
     section 12205 with respect to the local areas; or
       ``(2) to provide assistance to local bond authorities in 
     the State to pay a portion of the interest costs applicable 
     to any local bond issued to finance an activity described in 
     section 12205 with respect to the local areas.
       ``(c) Amount of Grant to State.--
       ``(1) In general.--From the amount available for grants 
     under section 12202(a)(2), the Secretary shall award a grant 
     to each eligible State that is equal to the total of--
       ``(A) a sum that bears the same relationship to 50 percent 
     of such amount as the total amount of funds made available 
     for all eligible local educational agencies in the State 
     under part A of title I for such year bears to the total 
     amount of funds made available for all eligible local 
     educational agencies in all States under such part for such 
     year; and
       ``(B) a sum that bears the same relationship to 50 percent 
     of such amount as the total amount of funds made available 
     for all eligible local educational agencies in the State 
     under title VI for such year bears to the total amount of 
     funds made available for all eligible local educational 
     agencies in all States under such title for such year.
       ``(2) Eligible local educational agencies.--For the purpose 
     of paragraph (1) the term `eligible local educational agency' 
     means a local educational agency that does not serve a local 
     area for which an eligible local bond authority received a 
     grant under section 12203.
       ``(d) State Applications Required.--To be eligible to 
     receive a grant under section 12202(a)(2), a State shall 
     prepare and submit to the Secretary an application at such 
     time, in such manner, and containing such information as the 
     Secretary may require. Such application shall contain--
       ``(1) a description of the process the State will use to 
     determine which local bond authorities will receive 
     assistance under subsection (b)(2).
       ``(2) an assurance that grant funds under this section will 
     be used to increase the amount of school construction or 
     renovation in the State for a fiscal year compared to such 
     amount in the State for the preceding fiscal years.
       ``(e) Administering Agency.--
       ``(1) In general.--The State agency with authority to issue 
     bonds for the construction or renovation of educational 
     facilities, or with the authority to otherwise finance such 
     construction or renovation, shall administer the amount 
     received through the grant.
       ``(2) Special rule.--If no agency described in paragraph 
     (1) exists, or if there is more than one such agency, then 
     the chief executive officer of the State and the chief State 
     school officer shall designate a State entity or individual 
     to administer the amounts received through the grant.
       ``(f) Assistance to Local Bond Authorities.--
       ``(1) In general.--To be eligible to receive assistance 
     from a State under this section, a local bond authority shall 
     prepare and submit to the State agency designated under 
     subsection (e) an application at such time, in such manner, 
     and containing such information as the State agency may 
     require, including the information described in section 
     12203(d).
       ``(2) Criteria.--In awarding grants under this section, the 
     State agency shall give preference to a local bond authority 
     based on--
       ``(A) the extent to which the local educational agency 
     serving the local area involved or the educational facility 
     for which the authority seeks the grant (as appropriate) 
     meets the criteria described in section 12103(a);
       ``(B) the extent to which the educational facility is 
     overcrowded; and
       ``(C) the extent to which assistance provided through the 
     grant will be used to fund construction or renovation that, 
     but for receipt of the grant, would not otherwise be possible 
     to undertake.
       ``(3) Amount of assistance.--A local bond authority seeking 
     assistance for a local area served by a local educational 
     agency described in--
       ``(A) clause (i)(I) or clause (ii)(I) of section 
     1125(c)(2)(A), shall be eligible for assistance in an amount 
     that does not exceed 10 percent;
       ``(B) clause (i)(II) or clause (ii)(II) of section 
     1125(c)(2)(A), shall be eligible for assistance in an amount 
     that does not exceed 20 percent;
       ``(C) clause (i)(III) or clause (ii)(III) of section 
     1125(c)(2)(A), shall be eligible for assistance in an amount 
     that does not exceed 30 percent;
       ``(D) clause (i)(IV) or clause (ii)(IV) of section 
     1125(c)(2)(A), shall be eligible for assistance in an amount 
     that does not exceed 40 percent; and
       ``(E) clause (i)(V) or clause (ii)(V) of section 
     1125(c)(2)(A), shall be eligible for assistance in an amount 
     that does not exceed 50 percent;

     of the interest costs applicable to any local bond issued to 
     finance an activity described in section 12205 with respect 
     to the local area.
       ``(g) Assistance to State.--
       ``(1) In general.--If a State issues a bond to finance an 
     activity described in section 12205 with respect to local 
     areas, the State shall be eligible for assistance in an 
     amount that does not exceed the percentage calculated under 
     the formula described in paragraph (2) of the interest costs 
     applicable to the State bond with respect to the local areas.
       ``(2) Formula.--The Secretary shall develop a formula for 
     determining the percentage referred to in paragraph (1). The 
     formula shall specify that the percentage shall consist of a 
     weighted average of the percentages referred to in 
     subparagraphs (A) through (E) of subsection (f)(3) for the 
     local areas involved.

     ``SEC. 12205. AUTHORIZED ACTIVITIES.

       ``An activity described in this section is a project of 
     significant size and scope that consists of--
       ``(1) the repair or upgrading of classrooms or structures 
     related to academic learning, including the repair of leaking 
     roofs, crumbling walls, inadequate plumbing, poor ventilation 
     equipment, and inadequate heating or light equipment;
       ``(2) an activity to increase physical safety at the 
     educational facility involved;
       ``(3) an activity to enhance the educational facility 
     involved to provide access for students, teachers, and other 
     individuals with disabilities;
       ``(4) an activity to improve the energy efficiency of the 
     educational facility involved;
       ``(5) an activity to address environmental hazards at the 
     educational facility involved, such as poor ventilation, 
     indoor air quality, or lighting;
       ``(6) the provision of basic infrastructure that 
     facilitates educational technology, such as communications 
     outlets, electrical systems, power outlets, or a 
     communication closet;
       ``(7) the construction of new schools to meet the needs 
     imposed by enrollment growth; and
       ``(8) any other activity the Secretary determines achieves 
     the purpose of this title.

     ``SEC. 12206. STATE GRANT WAIVERS.

       ``(a) Waiver for State Issuance of Bond.--
       ``(1) In general.--A State that issues a bond described in 
     section 12204(b)(1) with respect to a local area may request 
     that the Secretary waive the limits described in section 
     12204(f)(3) for the local area, in calculating the amount of 
     assistance the State may receive under section 12204(g). The 
     State may request the waiver only if no local entity is able, 
     for one of the reasons described in subparagraphs (A) through 
     (F) of paragraph (2), to issue bonds on behalf of the local 
     area. Under such a waiver, the Secretary may permit the State 
     to use amounts received through a grant made under section 
     12202(a)(2) to pay for not more than 80 percent of the 
     interest costs applicable to the State bond with respect to 
     the local area.
       ``(2) Demonstration by state.--To be eligible to receive a 
     waiver under this subsection, a State shall demonstrate to 
     the satisfaction of the Secretary that--
       ``(A) the local bond authority serving the local area has 
     reached a limit on its borrowing authority as a result of a 
     debt ceiling or property tax cap;
       ``(B) the local area has a high percentage of low-income 
     residents, or an unusually high property tax rate;
       ``(C) the demographic composition of the local area will 
     not support additional school spending;
       ``(D) the local bond authority has a history of failed 
     attempts to pass bond referenda;
       ``(E) the local area contains a significant percentage of 
     Federally-owned land that is not subject to local taxation; 
     or
       ``(F) for another reason, no local entity is able to issue 
     bonds on behalf of the local area.
       ``(b) Waiver for Other Financing Sources.--
       ``(1) In general.--A State may request that the Secretary 
     waive the use requirements of section 12204(b) for a local 
     bond authority to permit the State to provide assistance to 
     the local bond authority to finance

[[Page S9084]]

     construction or renovation by means other than through the 
     issuance of bonds.
       ``(2) Use of funds.--A State that receives a waiver granted 
     under this subsection may provide assistance to a local bond 
     authority in accordance with the criteria described in 
     section 12204(f)(2) to enable the local bond authority to 
     repay the costs incurred by the local bond authority in 
     financing an activity described in section 12205. The local 
     bond authority shall be eligible to receive the amount of 
     such assistance that the Secretary estimates the local bond 
     authority would be eligible to receive under section 
     12204(f)(3) if the construction or renovation were financed 
     through the issuance of a bond.
       ``(3) Matching requirement.--The State shall make available 
     to the local bond authority (directly or through donations 
     from public or private entities) non-Federal contributions in 
     an amount equal to not less than $1 for every $1 of Federal 
     funds provided to the local bond authority through the grant.
       ``(c) Waiver for Other Uses.--
       ``(1) In general.--A State may request that the Secretary 
     waive the use requirements of section 12204(b) for a State to 
     permit the State to carry out activities that achieve the 
     purpose of this title.
       ``(2) Demonstration by state.--To be eligible to receive a 
     waiver under this subsection, a State shall demonstrate to 
     the satisfaction of the Secretary that the use of assistance 
     provided under the waiver--
       ``(A) will result in an equal or greater amount of 
     construction or renovation of educational facilities than the 
     provision of assistance to defray the interest costs 
     applicable to a bond for such construction or renovation; and
       ``(B) will be used to fund activities that are effective in 
     carrying out the activities described in section 12205, such 
     as--
       ``(i) the capitalization of a revolving loan fund for such 
     construction or renovation;
       ``(ii) the use of funds for reinsurance or guarantees with 
     respect to the financing of such construction or renovation;
       ``(iii) the creation of a mechanism to leverage private 
     sector resources for such construction or renovation;
       ``(iv) the capitalization of authorities similar to State 
     Infrastructure Banks to leverage additional funds for such 
     construction or renovation; or
       ``(v) any other activity the Secretary determines achieves 
     the purpose of this title.
       ``(d) Local Bond Authority Waiver.--
       ``(1) In general.--A local bond authority may request the 
     Secretary waive the use requirements of section 12203(b) for 
     a local head authority to permit the authority to finance 
     construction or renovation of educational facilities by means 
     other than through use of bonds.
       ``(2) Demonstration.--To be eligible to receive a waiver 
     under this subsection, a local bond authority shall 
     demonstrate that the amounts made available through a grant 
     under the waiver will result in an equal or greater amount of 
     construction or renovation of educational facilities than the 
     provision of assistance to defray the interest costs 
     applicable to a bond for such construction or renovation.
       ``(e) Request for Waiver.--A State or local bond authority 
     that desires a waiver under this section shall submit a 
     waiver request to the Secretary that--
       ``(1) identifies the type of waiver requested;
       ``(2) with respect to a waiver described in subsection (a), 
     (c), or (d), makes the demonstration described in subsection 
     (a)(2), (c)(2), or (d)(2), respectively;
       ``(3) describes the manner in which the waiver will further 
     the purpose of this title; and
       ``(4) describes the use of assistance provided under such 
     waiver.
       ``(f) Action by Secretary.--The Secretary shall make a 
     determination with respect to a request submitted under 
     subsection (d) not later than 90 days after the date on which 
     such request was submitted.
       ``(g) General Requirements.--
       ``(1) States.--In the case of a waiver request submitted by 
     a State under this section, the State shall--
       ``(A) provide all interested local educational agencies in 
     the State with notice and a reasonable opportunity to comment 
     on the request;
       ``(B) submit the comments to the Secretary; and
       ``(C) provide notice and information to the public 
     regarding the waiver request in the manner that the applying 
     State customarily provides similar notices and information to 
     the public.
       ``(2) Local bond authorities.--In the case of a waiver 
     request submitted by a local bond authority under this 
     section, the local bond authority shall--
       ``(A) provide the affected local educational agency with 
     notice and a reasonable opportunity to comment on the 
     request;
       ``(B) submit the comments to the Secretary; and
       ``(C) provide notice and information to the public 
     regarding the waiver request in the manner that the applying 
     local bond authority customarily provides similar notices and 
     information to the public.

     ``SEC. 12207. GENERAL PROVISIONS.

       ``(a) Failure to Issue Bonds.--
       ``(1) States.--If a State that receives assistance under 
     this part fails to issue a bond for which the assistance is 
     provided, the amount of such assistance shall be made 
     available to the State as provided for under section 12204, 
     during the first fiscal year following the date of repayment.
       ``(2) Local bond authorities and local areas.--If a local 
     bond authority that receives assistance under this part fails 
     to issue a bond, or a local area that receives such 
     assistance fails to become the beneficiary of a bond, for 
     which the assistance is provided, the amount of such 
     assistance--
       ``(A) in the case of assistance received under section 
     12202(a)(1), shall be repaid to the Secretary and made 
     available as provided for under section 12203; and
       ``(B) in the case of assistance received under section 
     12202(a)(2), shall be repaid to the State and made available 
     as provided for under section 12204.
       ``(b) Liability of the Federal Government.--The Secretary 
     shall not be liable for any debt incurred by a State or local 
     bond authority for which assistance is provided under this 
     part. If such assistance is used by a local educational 
     agency to subsidize a debt other than the issuance of a bond, 
     the Secretary shall have no obligation to repay the lending 
     institution to whom the debt is owed if the local educational 
     agency defaults.

     ``SEC. 12208. FAIR WAGES.

       ``The provisions of section 12107 shall apply with respect 
     to all laborers and mechanics employed by contractors or 
     subcontractors in the performance of any contract and 
     subcontract for the repair, renovation, alteration, or 
     construction, including painting and decorating, of any 
     building or work that is financed in whole or in part using 
     assistance provided under this part.

     ``SEC. 12209. REPORT.

       ``From amounts reserved under section 12202(b)(3) for each 
     fiscal year the Secretary shall--
       ``(1) collect such data as the Secretary determines 
     necessary at the school, local, and State levels;
       ``(2) conduct studies and evaluations, including national 
     studies and evaluations, in order to--
       ``(A) monitor the progress of activities supported with 
     funds provided under this part; and
       ``(B) evaluate the state of United States educational 
     facilities; and
       ``(3) report to the appropriate committees of Congress 
     regarding the findings of the studies and evaluations 
     described in paragraph (2).

     ``SEC. 12210. FUNDING.

       ``(a) In General.--There are appropriated $1,900,000,000 
     for fiscal year 1998 to carry out this part.
       ``(b) Entitlement.--Subject to subsection (a), each State 
     or local bond authority awarded a grant under this part shall 
     be entitled to payments under the grant.
       ``(c) Availability.--Any amounts appropriated pursuant to 
     the authority of subsection (a) shall remain available until 
     expended.''.

     SEC. 3. CONFORMING AMENDMENTS.

       (a) Cross References.--Part A of title XII of the 
     Elementary and Secondary Education Act of 1965 (as 
     redesignated by section 2(3)) is amended--
       (1) in section 12102(a) (as redesignated by section 2(2))--
       (A) in paragraph (1)--
       (i) by striking ``12013'' and inserting ``12111'';
       (ii) by striking ``12005'' and inserting ``12103''; and
       (iii) by striking ``12007'' and inserting ``12105''; and
       (B) in paragraph (2), by striking ``12013'' and inserting 
     ``12111''; and
       (2) in section 12110(3)(C) (as redesignated by section 
     2(2)), by striking ``12006'' and inserting ``12104''.
       (b) Conforming Amendments.--Part A of title XII of the 
     Elementary and Secondary Education Act of 1965 (as 
     redesignated by section 2(3)) (20 U.S.C. 8501 et seq.) is 
     further amended--
       (1) in section 12101 (as redesignated by section 2(2)), by 
     striking ``This title'' and inserting ``This part''; and
       (2) in sections 12102(a)(2), 12102(b)(1), 12103(a), 
     12103(b), 12103(b)(2), 12103(c), 12103(d), 12104(a), 
     12104(b)(2), 12104(b)(3), 12104(b)(4), 12104(b)(6), 
     12104(b)(7), 12105(a), 12105(b), 12106(a), 12106(b), 
     12106(c), 12106(c)(1), 12106(c)(7), 12106(e), 12107, 
     12108(a)(1), 12108(a)(2), 12108(b)(1), 12108(b)(2), 
     12108(b)(3), 12108(b)(4), 12109(2)(A), and 12110 (as 
     redesignated by section 2(2)), by striking ``this title'' 
     each place it appears and inserting ``this part''.

     SEC. 4. MODIFICATION TO FOREIGN TAX CREDIT CARRYBACK AND 
                   CARRYOVER PERIODS.

       (a) In General.--Subsection (c) of section 904 of the 
     Internal Revenue Code of 1986 (relating to limitation on 
     credit) is amended--
       (1) by striking ``in the second preceding taxable year,'', 
     and
       (2) by striking ``or fifth'' and inserting ``fifth, sixth, 
     or seventh''.
       (b) Effective Date.--The amendment made by subsection (a) 
     shall apply to credits arising in taxable years beginning 
     after December 31, 1997.
                                                                    ____


           Educational Facilities Improvement Act--Fact Sheet


                            need for action

       Democrats continue to believe that Federal support for 
     education is one of the best investments our nation can make 
     to ensure

[[Page S9085]]

     its secure and prosperous future. For our students to learn, 
     they must be in a physical environment that is conducive to 
     learning. Unfortunately, our nation's schools are in 
     disrepair: about one third of all schools need extensive 
     repair or replacement, and about 60 percent of schools have 
     at least one major problem, such as a leaky roof or crumbling 
     walls.


                                summary

       The Educational Facilities Improvement Act provides $1.9 
     billion over 5 years to pay a portion of the interest cost on 
     state and local bond issues used to finance public elementary 
     and secondary school repair, renovation, modernization, and 
     construction projects.
       After set-asides for Indian Schools, U.S. territories, and 
     evaluations, 33 percent of the funds will be administered by 
     the Secretary of Education for competitive awards to the 100 
     school districts with the largest numbers of poor children, 
     and 25 other districts with extraordinary needs. The 
     remaining 67 percent will be distributed to states according 
     to a formula that takes into account school-age population, 
     poverty, and other criteria. States will set up competitive 
     programs to award these funds to school districts. School 
     districts will be eligible for a subsidy of up to 50 percent 
     of the interest cost on the bonds, using a sliding scale 
     based on need.


                         authorized activities

       The new program funds may be used to:
       Repair or upgrade classrooms or structures related to 
     academic learning, including the repair of leaking roofs, 
     crumbling walls, inadequate plumbing, poor ventilation, and 
     heating or light problems; increase physical safety; enhance 
     access for students, teachers or others with disabilities; 
     improve energy efficiency; address environmental hazards; 
     provide the basic infrastructure to facilitate educational 
     technology, such as communications outlets and closets, 
     electrical systems, and power outlets; construct new schools 
     to meet the needs imposed by growth; or conduct any other 
     related activity identified and approved by the Secretary.


                       distribution of the funds

       Of the new funds, 1.5 percent would be reserved for Indian 
     schools, and 0.5 percent would be reserved for the U.S. 
     territories to be administered at the discretion of the 
     Secretary. Not more than 0.1 percent would be set aside for 
     the Secretary to collect data, study the condition of 
     elementary and secondary schools, evaluate the program, and 
     report the findings to Congress.
       Of the remaining funds, 33 percent would be reserved for 
     administration by the Secretary to the 100 school districts 
     with the largest numbers of poor children, as well as to 25 
     additional districts at the discretion of the Secretary. The 
     remaining 67 percent would be reserved for administration by 
     the states to local education agencies.


                    funds to local bond authorities

       Under this program, 33 percent of the funding will be 
     administered directly by the Secretary of Education. School 
     districts will be eligible for up to a 50-percent interest 
     rate subsidy, using a sliding scale based on need. The 100 
     school districts with the largest numbers of poor children 
     will be eligible to apply directly to the Secretary for the 
     interest-rate subsidy. Eligible districts will be the top 100 
     with the highest levels of children ages 5 to 17 living in 
     poverty. In addition, the Secretary may designate up to 25 
     additional districts for direct grants, based on their 
     extraordinary needs.
       The Secretary will award grants to districts based on a 
     number of criteria, including the numbers of poor children in 
     that district, the overall age and condition of the schools 
     and their potential threat to children's health and safety, 
     the extent of overcrowding, the extent to which construction 
     would otherwise not occur, and other factors.


                            funds to states

       Of the remaining funds, 67 percent will be administered 
     directly by the states. The states must submit an application 
     to the Secretary describing the criteria the state will use 
     to award funds within the state. States can use the money to 
     subsidize local bond issues or to subsidize state bonds 
     issued on behalf of the school districts.
       The federal government will award the funds to the states 
     based on a two-part formula. Half of the funds will be based 
     on the state's share of federal Title I funds, and half will 
     be based on the state's share of federal Title VI funds. 
     School districts that receive direct grants from the 
     Secretary will be excluded from the calculations used to 
     determine the state-by-state allocations.


                                funding

       The amendment is funded at $1.9 billion, to remain 
     available until obligated. It is paid for by restructuring 
     the foreign tax credit carryover rules passed by the Senate 
     and left on the table during conference on the tax bill 
     (Section 867 of the Senate bill). This proposal would cut the 
     current carryback period for taxpayers with unused foreign 
     tax credits from 2 years to one, while extending the 
     carryforward period from 5 to 7 years.

  Ms. MOSELEY-BRAUN. Mr. President, today I am pleased to join the 
Minority Leader, Senator Daschle, to introduce the Education Facilities 
Improvement Act. This bill will form a partnership among the national, 
State, and local governments to rebuild and modernize our Nation's 
crumbling schools.
  According to the U.S. General Accounting Office, it will cost $112 
billion to bring existing school buildings up to code--to patch the 
leaky roofs, replace the broken windows, fix the plumbing, and make 
other needed repairs. That price tag, as enormous as it sounds, does 
not include the cost of building new schools to accommodate the record 
numbers of children who are crowding our schools, nor the cost of 
upgrading classrooms for modern computers.
  Local school districts cannot afford to meet these challenges on 
their own. The local property tax, which made sense as a funding 
mechanism when wealth was accumulated in the form of land, no longer 
works as a means of funding major capital investments. In urban, rural, 
and suburban schools all across the country, the magnitude of the 
crumbling schools problem has dwarfed local financing capabilities.
  In Chicago, Mayor Daley announced Monday that the city would issue 
800 million dollars' worth of bonds to build new schools, renovate old 
ones, and modernize every school in the system. With an improved bond 
rating, Chicago has financed almost 1.5 billion dollars' worth of 
school improvements in the last 2 years. Chicago schools, however, need 
3 billion dollars' worth of improvements.
  The problem is not confined to big cities like Chicago. The GAO found 
that in urban areas, 38 percent of schools are crumbling, while in 
rural areas the figure is 30 percent, and in the suburbs, it's 29 
percent.
  At the New Burnside Center in Tunnel Hill, IL, the track team was for 
a time forced to practice at the local prison. The prison had a track. 
The school did not. They no longer offer track at New Burnside, because 
some parents objected to their children being sent to the prison to 
practice. The lack of an adequate tax base means too many schools in 
rural areas can barely meet the basic costs of educating children, let 
alone the costs of major capital improvements.
  In the suburbs also, our outdated method of paying for public schools 
has taken its toll. Principal Rita Melius, from the Abbott middle 
school in Waukegan, a suburb north of Chicago, was here in Washington 
this morning to discuss this issue. Children in her suburban school 
have to cope with the same kinds of leaky roofs and crumbling walls as 
their innercity peers. The school has even had several fires caused 
when computers overloaded the ancient electrical wiring.
  The Education Facilities Improvement Act will provide $1.9 billion 
over 5 years to help Waukegan, Chicago, New Burnside, and schools 
across the country that simply cannot meet their facilities needs on 
their own. It will make the Government a partner in public education, 
while preserving local control of curriculum and educational content. 
This bill recognizes that education is a public good, as well as an 
individual benefit, and that every American benefits when we provide 
educational opportunities in environments suitable for learning.
  Winston Churchill said, ``We shape our buildings; thereafter, they 
shape us.'' Nowhere is that more true than in our schools. You 
certainly can't use a computer if you can't plug it into the wall, and 
we cannot expect our children to learn in schools that are falling down 
around them.
  I hope all of my colleagues will consider the conditions of schools 
in their States and join us in sponsoring this important legislation.

                          ____________________