[Congressional Record Volume 144, Number 41 (Thursday, April 2, 1998)]
[Senate]
[Pages S3141-S3143]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Ms. MOSELEY-BRAUN:
  S. 1927. A bill to amend section 2007 of the Social Security Act to 
provide grant funding for 20 additional Empowerment Zones, and for 
other purposes; to the Committee on Finance.


              the empowerment zone enhancement act of 1998

  Ms. MOSELEY-BRAUN. Mr. President, it gives me great pleasure to 
introduce the Empowerment Zone Enhancement Act of 1998. This 
legislation, I believe, will build on the economic success we have 
built over the last several years.
  We have worked to make this the strongest economy in a generation--by 
balancing the budget, investing in education and training, and opening 
up new markets for American products around the world. But we have also 
worked to make this the most inclusive economy in history, so everyone 
has a chance to participate, and no one is left behind. Further, we 
have stressed Community Empowerment. A strategy that gives people the 
tools--and acts as a catalyst for community collaboration--then 
communities can tap the ingenuity and enthusiasm of every citizen, and 
restore our downtowns and distressed areas to a level even our 
grandparents would be proud of.
  I believe that we are beginning to see results in this Community 
Empowerment Philosophy. The Empowerment Zone Initiative is the 
cornerstone program to ensure that all Americans benefit from the 
strong economy. The purpose of the EZ/EC Initiative is to assist 
distressed urban and rural communities to develop and implement 
holistic revitalization programs. In the first round of the Initiative, 
105 urban and rural EZ's and EC's were designated.
  This Initiative has not only produced the intended benefits of 
creating economic opportunity, broad-based community partnerships and 
sustainable community development, but has also had far-reaching spin-
off benefits in bringing together all segments of the EZ/ECs around the 
goal of community revitalization.
  Over $4 Billion in private investment has been leveraged in the EZ 
and EC's. Nearly 20,000 jobs have been created that have been filled by 
people who have previously not had access to economic opportunity. 
Entrepreneurship

[[Page S3142]]

opportunities have been created for people with a dream and the 
economic opportunity to see that dream realized. Job training and 
education opportunities have been created for nearly 45,000 residents. 
More than 12,000 Housing units have been constructed or rehabilitated. 
Communities have addressed public safety, infrastructure and 
environmental clean-up needs through more than 350 programs. More than 
52,000 children, youth and adults have been provided with services to 
help overcome challenges and contribute to their communities growth. In 
short, the EZ/EC Initiative has proven to be a successful holistic 
approach to community revitalization and economic development.
  The Taxpayer Relief Act of 1997 authorized designation of 20 
additional Empowerment Zones (15 urban and 5 rural), and provided for 
tax incentives for these new zones. However, that Act did not provide 
the flexible grant funding critical to the core concept and mission of 
the EZ/EC Initiative. This bill provides for $1.7 billion in grant 
funds over a 10-year period, $1.5 billion for the urban zones and $0.2 
billion for the rural zones. The application process for the second 
round of Empowerment Zones will begin in a few weeks. Communities will 
have several months to put together a comprehensive strategic plan that 
leverages private investment and provides for economic opportunity.
  We can rebuild even our poorest areas--if all the people in the 
community get together and decide to do it, and then find the tools 
they need to get it done. That's why we are so committed to our 
approach. We believe in government as a catalyst--helping to bring 
communities together to plan their future, and giving them the tools 
they need to reach that future. And it's working. For the first time in 
30 years, we're seeing success.
  From the South Bronx to areas of the Mississippi Delta to South 
Central LA to North Kenwood in Chicago--there is a growing American 
renaissance that is turning abandoned buildings, empty lots, and crime-
ridden street corners into new homes, new hope and new opportunity for 
the millions of Americans. This success makes us more and more 
convinced we're on the right track to reverse decades of decay, and to 
remake America's distressed areas into sources of pride and prosperity.
  The hardest part is getting started, and we've got it started now all 
across the country. Now it's just a matter of moving up the momentum by 
expanding the number of zones. With communities working from the 
inside, the federal government helping draw investment from the 
outside--I know this is a battle we're going to win.
  I urge all of my colleagues to join me in supporting quick passage of 
this legislation. I ask unanimous consent that the full 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. 1927

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled, That this 
     Act may be cited as the ``Empowerment Zone Enhancement Act of 
     1998''.

     SEC. 2. FUNDING ENTITLEMENT FOR ADDITIONAL ENTERPRISE ZONES.

       (a) Entitlement.--Section 2007(a)(1) of the Social Security 
     Act (42 U.S.C. 1397f(a)) is amended--
       (1) in subparagraph (A), by striking ``in the State; and'' 
     and inserting ``in the State designated pursuant to section 
     1391(b) of the Internal Revenue Code of 1986;'';
       (2) in subparagraph (B), by striking the period at the end 
     and inserting ``; and''; and
       (3) by adding after subparagraph (B) the following new 
     subparagraph:
       ``(C) 10 grants under this section for each qualified 
     empowerment zone in the State designated pursuant to section 
     1391(g) of such Code.''.
       (b) Amount of Grants.--Section 2007(a)(2) of that Act (42 
     U.S.C. 1397f(a)(2)) is amended--
       (1) in the heading of subparagraph (A), by inserting 
     ``original'' before ``empowerment'';
       (2) in subparagraph (A), in the matter preceding clause 
     (i), by inserting ``described in paragraph (1)(A)'' after 
     ``empowerment zone'';
       (3) by redesignating subparagraph (C) as subparagraph (D); 
     and
       (4) by inserting after subparagraph (B) the following new 
     subparagraph:
       ``(C) Additional empowerment grants.--The amount of each 
     grant to a State under this section for a qualified 
     empowerment zone described in paragraph (1)(C) shall be--
       ``(i) if the zone is designated in an urban areas, 
     $10,000,000, or
       ``(ii) if the zone is designated in a rural area, 
     $4,000,000,

     multiplied by the proportion of the population of the zone 
     that resides in the State.''.
       (c) Timing of Grants.--Section 2007(a)(3) of that Act (42 
     U.S.C. 1397f(a)(3)) is amended--
       (1) in the heading of subparagraph (A), by inserting 
     ``original'' before ``qualified'';
       (2) in subparagraph (A), in the matter preceding clause 
     (i), by inserting ``described in paragraph (1)(A)'' after 
     ``empowerment zone''; and
       (3) by adding after subparagraph (B) the following new 
     subparagraph:
       ``(C) Additional qualified empowerment zones.--With respect 
     to each qualified empowerment zone described in paragraph 
     (1)(C), the Secretary shall make--
       ``(i) 1 grant under this subsection to the State in which 
     the zone lies, on the date of the designation of the zone 
     under such part I; and
       ``(ii) 1 grant under this subsection to such State, on the 
     first day of each of the nine fiscal years that begin after 
     the date of the designation.''.
       (d) Funding.--Section 2007(a)(4) of that Act (42 U.S.C. 
     1397f(a)(4)) is amended--
       (1) by relocating and redesignating the matter following 
     the caption as subparagraph (A);
       (2) by inserting ``Original grants.--'' after the 
     subparagraph designation ``(A)'';
       (3) in subparagraph (A), as so redesignated, by inserting 
     before the period ``for empowerment zones and enterprise 
     communities described in subparagraphs (A) and (B) of 
     paragraph (1)''; and
       (4) by adding after subparagraph (A), as so redesignated, 
     the following new subparagraph:
       ``(B) Additional grants.--$1,700,000,000 shall be made 
     available to the Secretary for grants under this section for 
     empowerment zones described in paragraph (1)(C).''.

     SEC. 3. USE OF GRANTS FOR LOAN FUNDS AND SIMILAR 
                   ARRANGEMENTS.

       Section 2007(b) of the Social Security Act (42 U.S.C. 
     1397f(b)) is amended by adding at the end the following new 
     paragraph:
       ``(5)(A) In order to assist disadvantaged adults and youth 
     in achieving and maintaining economic self-support, a State 
     may use amounts paid under this section to fund revolving 
     loan funds or similar arrangements for the purpose of making 
     loans, loan guarantees, financial services, or related 
     activities more accessible to residents, institutions, 
     organizations, or businesses.
       ``(B) Interest earned by, and repayments of principal and 
     interest on loans made from, revolving funds or similar 
     arrangements described in subparagraph (A) shall be credited 
     to such funds.
       ``(C) The funding of, or holding of funds in, a revolving 
     loan fund or similar arrangement in accordance with 
     subparagraph (A), in amounts reasonably necessary to carry 
     out the purposes of such subparagraph (A), shall be deemed to 
     comply with any requirement to minimize the time elapsing 
     between transfer of funds from the United States Treasury and 
     the issuance of payments for program purposes.''.

     SEC. 4. RESPONSIBILITY FOR ENVIRONMENTAL REVIEW.

       Section 2007 of the Social Security Act (42 U.S.C. 1397f) 
     is amended--
       (1) by redesignating subsection (f) as subsection (h); and
       (2) by inserting after subsection (e) the following new 
     subsection:
       ``(f) Environmental Review.--
       ``(1) Execution of responsibility by the secretary of 
     housing and urban development and the secretary of 
     agriculture.--
       ``(A) Applicability.--This subsection shall apply to grants 
     under this section in connection with empowerment zones and 
     enterprise communities designated under section 1391(a) of 
     the Internal Revenue Code of 1986 and empowerment zones 
     designated under section 1391(g) of such Code--
       ``(i) by the Secretary of Housing and Urban Development in 
     the case of those located in urban areas; and
       ``(ii) by the Secretary of Agriculture in the case of those 
     located in rural areas.
       ``(B) Execution of responsibility.--With respect to grants 
     described in subparagraph (A), the Secretary of Housing and 
     Urban Development and the Secretary of Agriculture, as 
     appropriate, shall execute the responsibilities under the 
     National Environmental Policy Act of 1969 and other 
     provisions of law which further the purposes of such Act (as 
     specified in under this section if the State, unit of general 
     local government, or Indian tribe, as designated by the 
     Secretary in accordance with regulations issued by the 
     Secretary under paragraph (2)(B), assumes all of the 
     responsibilities for environmental review, decisionmaking, 
     and action pursuant to such Act, and such other provisions of 
     law as the regulations of the Secretary specify, that would 
     otherwise apply to the Secretary were the Secretary to 
     undertake such projects as Federal projects.
       ``(B) Implementation.--The Secretary of Housing and Urban 
     Development and the Secretary of Agriculture shall each issue 
     regulations to carry out this subsection only after 
     consultation with the Council on Environmental Quality. Such 
     regulations shall--
       ``(i) specify any other provisions of law which further the 
     purposes of the National Environmental Policy Act of 1969 and 
     to which the assumption of responsibility as provided in this 
     subsection applies;

[[Page S3143]]

       ``(ii) provide eligibility criteria and procedures for the 
     designation of a State, unit of general local government, or 
     Indian tribe to assume all of the responsibilities in this 
     section;
       ``(iii) specify the purposes for which funds may be 
     committed without regard to the procedure established under 
     paragraph (3);
       ``(iv) provide for monitoring of the performance of 
     environmental reviews under this subsection;
       ``(v) in the discretion of the Secretary, provide for the 
     provision or facilitation of training for such performance; 
     and
       ``(vi) subject to the discretion of the Secretary, provide 
     for suspension or termination by the Secretary of the 
     assumption under subparagraph (A).
       ``(C) Responsibilities of state, unit of general local 
     government, or indian tribe.--The Secretary's duty under 
     subparagraph (B) shall not be construed to limit any 
     responsibility assumed by a State, unit of general local 
     government, or Indian tribe with respect to any particular 
     release of funds under subparagraph (A).
       ``(3) Procedure.--The Secretary shall approve the release 
     of funds for projects subject to the procedures authorized by 
     this subsection only if, not less than 15 days prior to such 
     approval and prior to any commitment of funds to such 
     projects (except for such purposes specified in the 
     regulations issued under paragraph (2)(B)), the recipient 
     submits to the Secretary a request for such release 
     accompanied by a certification of the State, unit of general 
     local government, or Indian tribe which meets the 
     requirements of paragraph (4). The approval by the Secretary 
     of any such certification shall be deemed to satisfy the 
     Secretary's responsibilities pursuant to paragraph (1) under 
     the National Environmental Policy Act of 1969 and such other 
     provisions of law as the regulations of the Secretary specify 
     insofar as those responsibilities relate to the releases of 
     funds for projects to be carried out pursuant thereto which 
     are covered by such certification.
       ``(4) Certification.--A certification under the procedures 
     authorized by this subsection shall--
       ``(A) be in a form acceptable to the Secretary;
       ``(B) be executed by the chief executive officer or other 
     officer of the State, unit of general local government, or 
     Indian tribe who qualifies under regulations of the 
     Secretary:
       ``(C) specify that the State, unit of general local 
     government, or Indian tribe under this subsection has fully 
     carried out its responsibilities as described under paragraph 
     (2); and
       ``(D) specify that the certifying officer--
       ``(i) consents to assume the status of a responsible 
     Federal official under the National Environmental Policy Act 
     of 1969 and each provision of law specified in regulations 
     issued by the Secretary insofar as the provisions of such Act 
     or other such provision of law apply pursuant to paragraph 
     (2); and
       ``(ii) is authorized and consents on behalf of the State, 
     unit of general local government, or Indian tribe and himself 
     or herself to accept the jurisdiction of the Federal courts 
     for the purpose of enforcement of the responsibilities as 
     such an official.
       ``(5) Approval by states.--In cases in which a unit of 
     general local government carries out the responsibilities 
     described in paragraph (2), the Secretary may permit the 
     State to perform those actions of the Secretary described in 
     paragraph (3). The performance of such actions by the State, 
     where permitted, shall be deemed to satisfy the 
     responsibilities referred to in the second sentence of 
     paragraph (3).''.

     SEC. 5. PERFORMANCE MEASUREMENT AND EVALUATION; GRANT 
                   ADJUSTMENTS.

       Section 2007 of the Social Security Act (42 U.S.C. 1397f), 
     as amended by section 4, in further amended by adding after 
     subsection (f) the following subsection:
       ``(g) Performance Measurement System, Reports, and 
     Evaluations, Grant Adjustments, and Related Matters.--
       ``(1) Applicability.--The requirements of this subsection--
       ``(A) apply to all grants made by a State, from grants to 
     the State under subsection (a)(2)(C), to lead implementing 
     entities (as defined in paragraph (7)) for empowerment zones 
     designated pursuant to section 1391(g) of the Internal 
     Revenue Code of 1986 (26 U.S.C. 1391(g)); and
       ``(B) are in addition to the annual report and biennial 
     audit requirements applicable to States under section 2006.
       ``(2) Performance measurement system.--The lead 
     implementing entity for an empowerment zone shall establish a 
     performance measurement system acceptable to the Secretary to 
     assist in assessing the extent to which its strategic plan is 
     being implemented and funds made available under subsection 
     (a)(2)(C) are being used effectively.
       ``(3) Performance report.--Each lead implementing entity 
     shall submit to the Secretary (and make available to the 
     public upon request), at such time and in such manner as the 
     Secretary shall prescribe, a report including an assessment 
     of the progress the empowerment zone has made toward 
     implementing its strategic plan, and such other information 
     as the Secretary shall prescribe. To the extent practicable, 
     the report shall also include information available to the 
     lead implementing entity with respect to the use of tax 
     incentives available to empowerment zones designated pursuant 
     to section 1391(g) of the Internal Revenue Code of 1986.
       ``(4) Performance evaluations, adjustments, and 
     recordkeeping.--
       ``(A) Performance evaluations.--The Secretary shall 
     regularly evaluate the progress of the lead implementing 
     entity for the empowerment zone in implementing the strategic 
     plan for the zone, on the basis of performance reviews and 
     any other information that the Secretary may require.
       ``(B) Adjustments.--On the basis of the Secretary's 
     evaluation under subparagraph (A), the Secretary may direct 
     the Secretary of Health and Human Services to adjust, reduce, 
     or cancel the grant to a State under subsection (a)(2)(C) for 
     the current or any future fiscal year or years, except that 
     amounts already properly expended by a lead implementing 
     entity on eligible activities under this Act shall not be 
     recaptured or deducted from future grants to the State.
       ``(5) Retention of records.--Each lead implementing entity 
     shall keep such records relating to funds received from 
     grants to the State under subsection (a)(2)(C), including the 
     amounts and disposition of such funds and the types of 
     activities funded, as the Secretary determines to be 
     necessary to enable the Secretary to evaluate the performance 
     of the lead implementing agency and to determine compliance 
     with the requirements of this subsection.
       ``(6) Secretary's access to documents.--The Secretary shall 
     have access, for the purpose of evaluations and examinations 
     pursuant to paragraph (4)(A), to any books, documents, 
     papers, and records of any grantee or other entity or person 
     that are pertinent to grant amounts received in connection 
     with this section.
       ``(7) Definitions.--For purposes of this subsection--
       ``(A) The term `lead implementing entity' means the local 
     government or governments, the governance body of an 
     empowerment zone as specified in the strategic plan, or any 
     non-profit entity that is principal administrator of an 
     empowerment zone.
       ``(B) The term `Secretary' means the Secretary of Housing 
     and Urban Development for purposes of grants under this 
     section with respect to urban areas and means the Secretary 
     of Agriculture for purposes of grants under this section with 
     respect to rural areas, except as the context otherwise 
     indicates.

     SEC. 6. TECHNICAL AMENDMENTS.

       Section 2007(b) of the Social Security Act is amended--
       (1) in paragraph (2), in the matter preceding subparagraph 
     (A), by striking ``to prevent''; and
       (2) in paragraph (4), in the matter preceding subparagraph 
     (A), by striking ``maintain'' and inserting ``maintaining''.
                                 ______