[Congressional Record Volume 145, Number 8 (Tuesday, January 19, 1999)]
[Senate]
[Pages S402-S406]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. SPECTER (for himself and Mr. Durbin):
  S. 23. A bill to promote a new urban agenda, and for other purposes; 
to the Committee on Finance.


                    the new urban agenda act of 1999

  Mr. SPECTER. Mr. President, I have sought recognition to introduce 
legislation that will deal with the plight of our nation's cities and 
Washington's increasing neglect of them. With 80% of the U.S. 
population living in metropolitan areas, there is an urgent need to 
improve our urban economies and the quality of life for the millions of 
Americans who live and work in cities. By simply making our cities an 
appealing place to live, work, recreate, and visit, urban areas can 
rebound to the vibrant economic centers they once were.
  There is a common perception that urban areas are abandoned and 
stripped of their resources, burdened with poverty and crime. However, 
cities have a wealth of resources available to not only the urban 
dweller but to the world--cultural centers, business hubs, and some of 
the finest educational and medical institutions. The real problem is 
that we do not draw upon these riches or strive to better coordinate 
them to serve people, most especially those in need.
  My proposal, the ``New Urban Agenda Act of 1999'' is based on 
legislation which I have endeavored to make law since the 103rd 
Congress. I am pleased to be introducing it today, in this first 
Congress of the new millennium, with my distinguished colleague from 
Illinois, Senator Durbin, who also recognizes the potential of both 
small cities and large metropolitan areas.
  The bill constitutes an effort to give our cities some much-needed 
attention, but reflects the federal budgetary constraints which govern 
all that we in Congress do these days. This bill, based in significant 
part on suggestions by Philadelphia Mayor Edward G. Rendell and the 
League of Cities, offers aid to the cities while containing federal 
expenditures and by re-instituting important cost-effective tax breaks 
which have been discontinued.
  If we are to really address many of the very serious social issues 
that we face--unemployment, teenage pregnancy, welfare dependency, and 
other pressing issues--we cannot give up on our cities. There must be 
new strategies for dealing with the problems of urban America. The days 
of creating ``Great Society'' federal aid programs are clearly past, 
but that is no excuse for the national government to turn a blind eye 
to the problems of the cities.

[[Page S403]]

  Urban areas remain integral to America's greatness as centers of 
commerce, industry, education, health care, and culture. Yet urban 
areas, particularly the inner cities which tend to have a 
disproportionate share of our nation's poor, also have special needs 
which must be recognized. We must develop ways of aiding our cities 
that do not require either new taxes or more government bureaucracy.
  As a Philadelphia resident, I have first-hand knowledge of the 
growing problems that plague our cities. The most recent U.S. Census 
data collected showed that Philadelphia has over 300,000 individuals in 
poverty and when federal welfare reform took effect in October 1996, 
113,000 adults were receiving some form of cash assistance. Reflecting 
on my experience as a Philadelphian, I have long supported a variety of 
programs to assist our cities, such as increased funding for Community 
Development Block Grants and legislation to establish enterprise and 
empowerment zones. To encourage similar efforts, in April, 1994, I 
hosted my Senate Republican colleagues on a visit to explore urban 
problems in my hometown. We talked with people who wanted to obtain 
work, but had found few opportunities. We saw a crumbling 
infrastructure and its impact on residents and businesses. We were 
reminded of the devastating effect that the loss of inner city 
businesses and jobs has had on our neighborhoods in America's cities. 
What my Republican colleagues saw then in Philadelphia is the urban 
rule across our country and not the exception.
  There are many who do not know of city life, who are far removed from 
the cities and would not be expected to have any key interest in what 
goes on in the big cities of America. I cite my own boyhood experience 
illustratively: Born in Wichita, Kansas, raised in Russell, a small 
town of 5,000 people on the plains of Kansas, where there is not much 
detailed knowledge of what goes on in Philadelphia, Pennsylvania, or 
other big cities like Los Angeles, San Francisco, New York, Miami, 
Pittsburgh, Dallas, Detroit or Chicago.
  Those big cities are alien to people in much of America. But there is 
a growing understanding that the problems of big cities contribute 
significantly to the general problems affecting our nation and have an 
economic impact, at the very least, on our small towns. For rural 
America to prosper, we need to make sure that urban America prospers 
and vice-versa. For example, if cities had more economic growth, taxes 
could be reduced on all Americans at the federal and state level 
because revenues would increase and social welfare spending would be 
reduced.
  There is indeed a domino effect from our cities to rural communities 
of the country. Lately, we have been witnessing this in the violent 
behavior of adolescents. School violence and juvenile crime are no 
longer endemic to urban living. Take the Bloods and the Crips gangs 
from Los Angeles, California, and similar gangs; that are all over 
America. They are in Lancaster, Pennsylvania; Des Moines, Iowa; 
Portland, Oregon; Jackson, Mississippi; Racine, Wisconsin; and 
Martinsburg, West Virginia. They are literally everywhere, big city and 
small city alike.
  In the U.S. Department of Housing and Urban Development's 1998 report 
on the ``State of the Cities,'' findings show that large urban schools 
still deal with a higher concentration of violence, and the data only 
represents crimes which were serious enough to report to the police. 
The School District of Philadelphia's most recent report on school 
violence shows that in the 1994-1995 academic year, students, teachers 
and administrators were the victims of 2,147 reported criminal 
incidents, up by almost 100% from the previous year. These included 
assault, robbery, rape, and students being stabbed or even shot. The 
school district also reported troubling news about abysmal attendance 
rates. On any given day, more than one in every four students are 
absent.
  Understandably so, city residents are afraid to continue leading an 
urban lifestyle. Each day, small business owners question whether they 
should remain in the city because they fear for the safety of their 
children, their employees, and ultimately, their businesses. I have 
personally met and spoken with shop owners in the University City 
section of Philadelphia who tell me that they look desperately for 
reasons to stay, but it gets harder and harder.
  Joblessness and a less skilled work force are additional problems. To 
facilitate economic development and job creation in the United States, 
I supported the Balanced Budget Act of 1995, which contained such 
provisions as the Job Training Partnership Act and the Targeted Job Tax 
Credit. As Congress put the final touches on that legislation, I 
circulated a joint letter from several Senators to then-Majority Leader 
Dole and Speaker Gingrich recommending spurring job creation and 
economic growth in our cities through several urban initiatives such 
as: a targeted capital gains exclusion, commercial revitalization tax 
credit, historic rehabilitation tax credit, and child care credit. Last 
year, I introduced the ``Job Preparation and Retention Training Act of 
1998,'' which was included in the recently enacted Workforce 
Development Act of 1998. My legislation authorized funding for States 
to enroll long-term welfare dependents into a training program which 
would provide the necessary skills to locate and maintain gainful and 
unsubsidized employment.

  The last census taken in 1990, reported that New York City led the 
way, with 1.3 million individuals in poverty. My home of Philadelphia 
had 313,374 individuals in poverty at that time. And in HUD's 1998 
``State of the Cities'' report, by 1996, one in every five urban 
families lived in poverty, compared with fewer than one in ten suburban 
families. These facts emphasize the need for more efforts to be focused 
on strengthening our inner city businesses which, in turn, will boost 
local economies and serve to provide more jobs, reduce poverty and, 
hopefully, reduce crime.
  I have long supported efforts to encourage the growth of small 
business. During the 105th Congress, I once again introduced 
legislation to provide targeted tax incentives for investing in small 
minority- or women-owned businesses. Small businesses provide the bulk 
of the jobs in this country. Many minority entrepreneurs, for instance, 
have told me that they are dedicated to staying in the cities to employ 
people there, but continue to confront capital access issues. My 
legislation, the ``Minority and Women Capital Formation Act'' would 
help to remove the capital access barriers, thereby enabling these 
entrepreneurs to grow their businesses and payrolls.
  Municipal leaders are stressing many of the same concerns that 
business people are voicing. In a July, 1994 National League of Cities 
report dealing with poverty and economic development, municipal leaders 
ranked inadequate skills and education of workers as one of the top 
three reasons, in addition to shortage of jobs and below-poverty wages, 
for poverty and joblessness in their cities. They said, according to 
the survey, that more jobs must be created through local economic 
development initiatives.
  This ``skills deficit'' is highlighted in an urban revitalization 
plan prepared in 1991 by the National Urban League called ``Playing to 
Win: A Marshall Plan for America's Cities.'' The report cites a 
statistic by the Commission on Achieving Necessary Skills which showed 
that 60 percent of all 21-25 year-olds lack the basic reading and 
writing skills needed for the modern workplace, and only 10 percent of 
those in that age group have enough mathematical competence for today's 
jobs. The economic problems our cities are facing are not easy to deal 
with or answer. In a report by the National League of Cities entitled 
``City Fiscal Conditions in 1996,'' municipal officials from 381 cities 
answered questions on the economic state of their cities. In response 
to state budgetary problems, 21.7 percent of responding cities reduced 
municipal employment and 18.5 percent had frozen municipal employment. 
Nearly six out of ten cities raised or imposed new taxes or user fees 
during the past twelve months.
  These numbers are of concern to me and I believe they highlight the 
need for federal legislation to enhance the ability of cities to 
achieve competitive economic status. An added concern is that city 
managers are forced to balance cuts in services or enact higher taxes. 
Neither choice is easy and it often counteracts municipal efforts to 
retain residents or businesses.

[[Page S404]]

  One issue, in particular, that is hurting many cities is the erosion 
of their tax bases, evidenced particularly by middle-class flight to 
the suburbs. Mr. Ronald Walters, professor of Political Science at 
Howard University, in testimony before the Senate Banking Committee in 
April 1993, stated that in 1950, 23 percent of the American population 
lived outside central cities; by 1988, that number was up to 46 
percent. The District of Columbia's population loss is among the worst 
in the nation, with a quarter of its population relocating since the 
1970s. This trend of shrinking urban populations gives no sign of 
ceasing. Middle-class families continue to leave for the suburbs where 
there are typically better public services.
  These losses are devastating, not only to the financial stability of 
the city, but to the social fabric as well. On the financial side, 
statistics show that those people fleeing cities were earning an 
average of $30,000 to $75,000 a year. On the social side, roughly half 
of these are African-American Middle-class families. By losing this 
critical demographic group, the city loses much of what makes it 
strong. As America's cities struggle with the exodus of residents, 
businesses and industry, city residents who remain are faced with 
problems ranging from increased tax burdens and lesser services to 
dwindling economic opportunities, leading to welfare dependence and 
unemployment assistance. In the face of all this, what do we do?
  The federal government has attempted to revitalize our ailing urban 
infrastructure by providing federal funding for transit and sewer 
systems, roads and bridges. I have supported this. For example, as a 
member of the Transportation Appropriations Subcommittee and as co-
chair of an informal Senate Transit Coalition, I have been a strong 
supporter of public transit which provides critically needed 
transportation services in urban areas. Transit helps cities meet clean 
air standards, reduce traffic congestion, and allows disadvantaged 
persons access to jobs. Federal assistance for urban areas, however, 
has become increasingly scarce as we grapple with the nation's deficit 
and debt. Therefore, we must find alternatives to reinvigorate our 
nation's cities so they can once again be economically productive areas 
providing promising opportunities for residents and neighboring areas. 
To address the need for reliable transportation systems in our nation's 
cities and to provide access to jobs for city residents, I introduced 
reverse commute and jobs access legislation, which was successfully 
included in last year's highway and transit reauthorization bill. The 
bill authorizes $400 million over the next five years in access-to-jobs 
transit grants targeted at low-income individuals. Up to $10 million 
per year can be used for reverse commute projects to move individuals 
from cities to suburban job centers.
  In addition to support for infrastructure, I believe there are ways 
Congress can assist the cities. In 1994, Mayor Rendell came up with a 
legislative package which contains many good ideas. I have taken many 
of these suggestions and have since added and revised provisions to 
take into account new developments at the federal, state and local 
levels to create the ``New Urban Agenda Act of 1999.''
  First, recognizing that the federal government is the nation's 
largest purchaser of goods and services, this legislation would require 
that no less than 15 percent of federal government purchases are made 
from businesses and industries within designated urban Empowerment 
Zones and Enterprise Communities. Similarly, my bill would require that 
not less than 15 percent of foreign aid funds be redeemed through 
purchases of products manufactured in urban Empowerment Zones and 
Enterprise Communities. The General Services Administration will be 
required to submit to Congress its assessment of the extent to which 
federal agencies are committed to this policy and in general, economic 
revitalization in distressed urban areas.
  The second major provision of this bill would commit the federal 
government to play an active role in restoring the economic health of 
our cities by encouraging the location, or relocation, of federal 
facilities in urban areas. To accomplish this, all federal agencies 
would be required to prepare and submit to the President an Urban 
Impact Statement detailing the impact that relocation or downsizing 
decisions would have on the affected city. Presidential approval would 
be required to place a federal facility outside an urban area, or to 
downsize a city-based agency.
  The third critical component of this bill would revive and expand 
federal tax incentives that were eliminated or restricted in the Tax 
Reform Act of 1986. Until there is passage of legislation on the flat 
tax, which would provide benefits superior to all targeted tax breaks, 
I believe America's cities should have the advantages of such tax 
benefits. These provisions offer meaningful incentives to business to 
invest in our cities. I am calling for the restoration of the Historic 
Rehabilitation Tax Credit which supports inner city revitalization 
projects. According to information provided by Mayor Rendell, there 
were 8,640 construction jobs involved in 356 projects in Philadelphia 
from 1978 to 1985 stimulated by the Historic Rehabilitation Tax Credit. 
In Chicago, 302 projects prior to 1985 generated $524 million in 
investment and created 20,695 jobs. In St. Louis, 849 projects 
generated $653 million in investment and created 27,735 jobs.

  Nationally, according to National Park Service estimates for the 16 
years before the 1986 Act, the Historic Rehabilitation Tax Credit 
stimulated $16 billion in private investment for the rehabilitation of 
24,656 buildings and the creation of 125,306 homes which included 
23,377 low and moderate income housing units. The 1986 Tax Act 
dramatically reduced the pool of private investment capital available 
for rehabilitation projects. In Philadelphia, projects dropped from 356 
to 11 by 1988 from 1985 levels. During the same period, investments 
dropped 46 percent in Illinois and 92 percent in St. Louis.
  Another tool is to expand the authorization of commercial industrial 
development bonds. Under the Tax Reform Act of 1986, authorization for 
commercial industrial bonds was permitted to expire. Consequently, 
private investment in cities declined. For instance, according to Mayor 
Rendell, from 1986--the last year commercial development bonds were 
permitted--to 1987, the total number of city--supported projects in 
Philadelphia was reduced by more than half.
  Industrial development or private activity bonds encourage private 
investment by allowing, under certain circumstances, tax-exempt status 
for projects where more than 10 percent of the bond proceeds are used 
for private business purposes. The availability of tax-exempt 
commercial industrial development bonds will encourage private 
investment in cities, particularly the construction of sports, 
convention and trade show facilities; free standing parking facilities 
owned and operated by the private sector; air and water pollution 
facilities owned and operated by the private sector; and, industrial 
parks.
  The bill I am introducing would allow this. It would also increase 
the small issue exemption, which means a way to help finance private 
activity in the building of manufacturing facilities from $10 million 
to $50 million to allow increased private investment in our cities.
  A minor change in the federal tax code related to arbitrage rebates 
on municipal bond interest earnings could also free additional capital 
for infrastructure and economic development by cities. Currently, 
municipalities are required to rebate to the federal government any 
arbitrage--a financial term meaning interest earned in excess of 
interest paid on the debt--earned from the issuance of tax-free 
municipal bonds. I am informed that compliance, or the cost for 
consultants to perform the complicated rebate calculations, is actually 
costing municipalities more than the actual rebate owed to the 
government. This bill would allow cities to keep the arbitrage earned 
so that they can use it to fund city projects and for other necessary 
purposes.
  My legislation also provides important incentives for businesses to 
invest and locate in our nation's cities. Specifically, the bill 
includes a provision which I have advocated to provide a 50 percent 
exclusion for capital gains tax purposes for any gain resulting from 
targeted investments in small businesses located in urban empowerment 
zones, enterprise communities, or enterprise zones. I also want to note 
that the exclusion would extend to any venture funds that invest in 
those small

[[Page S405]]

businesses, which is critical because venture funds are often the 
lifeblood of a small business. This is one of the incentives I 
recommended to Senator Dole in December 1995 for inclusion in the 
Balanced Budget Act of 1995 which was later vetoed by President 
Clinton. A targeted capital gains exclusion will serve as a catalyst 
for job creation and economic growth in our cities by encouraging 
additional private investment in our urban areas.
  A fourth provision of this legislation provides needed reforms to 
regulations and the financial challenges to obtaining affordable 
housing. This legislation provides language to study streamlining 
federal housing program assistance to urban areas into a block grant 
form so that municipal agencies can better serve local residents. Safe, 
clean, and affordable housing is not widely available to most low 
income families. According to the National Housing Law Project, in 
1996, only one in four families was eligible to receive HUD assistance, 
with waits of up to five years. In HUD's most recent annual report, 
just as many families are still struggling with the lack of affordable 
housing as they were when a record 5.3 million low-income renters were 
paying more than 50 percent of their income for rent between 1993 and 
1995. This provision of the bill steers the Secretary of Housing and 
Urban Development to take a hard look at these conditions and determine 
what works and what does not work in federally-subsidized housing and 
to consider alternatives that will provide suitable homes for America's 
families.
  I believe that we as a nation should work toward providing 
individuals and their families with more opportunities for 
homeownership which stabilizes a community and would especially restore 
our cities. Urban homeownership including middle-income homeownership 
lags behind the suburbs. According to the Harvard University Joint 
Center for Housing Studies, city residents of all income levels are 
less likely to own a home than suburban residents with similar incomes. 
I hear time and time again from families starting out that they move 
out to the suburbs for better schools, because central cities lack the 
property tax base to provide for quality schools. Homeownership is key 
to saving our cities, both socially and economically. A 1998 Fannie Mae 
national housing survey indicated that even though homeownership rates 
continue to increase in the late 1990s, six in every ten renters said 
that buying a home is a very important priority, if not their number-
one priority in life. Yet for so many families financial barriers make 
that dream unattainable. That is why my bill includes a tax credit to 
restore the American dream of homeownership. A tax credit could be used 
by income-eligible individuals and families to purchase homes in 
distressed areas. In the 1997 Taxpayer Relief Act, Congress approved 
such a tax credit for homebuyers in the District of Columbia. While 
single family home sales can be attributed to a multitude of factors, 
such as historically low interest rates and a strong economy, let me 
just share with you some amazing statistics related to homeownership 
since enactment of the tax credit in the District of Columbia. The Home 
Purchase Assistance Program through the District of Columbia's Office 
of Housing and Community Development helped 410 families purchase 
homes. Further, a group called the ``Washington Partners for 
Homeownership,'' a collaboration of realtors, banks, community and 
faith-based organizations, set a goal last year to create 1,000 new 
homeowners in the District of Columbia for each of the next three 
years. Remarkably, the Washington Partners have already reached that 
goal before the end of the first year. I believe that this country will 
reap extraordinary benefits if we expand such a credit on a national 
basis, as I propose in the ``New Urban Agenda Act of 1999.''

  I believe that the revitalization of cities will require social and 
economic facets, but it is also imperative that our cities are safe and 
clean. This last component of my bill helps urban areas to address 
their unique environmental challenges and reforms Superfund law. First, 
the legislation authorizes a federal brownfields program to help clean 
up idle or underused industrial and commercial facilities and waives 
federal liability for persons who fully comply with a state cleanup 
plan to clean sites in urban areas pursuant to state law, provided that 
the site is not listed or proposed to be listed on the National 
Priorities List. The Environmental Protection Agency currently operates 
this pilot program under general authority provided by the Superfund 
law.
  My legislation would make this a permanent program and substantially 
increase the funding levels to a $50 million authorized level for 
Fiscal Year 2000. The EPA could expend funds to identify and examine 
potential idle or underused Brownfield sites and to provide grants to 
States and local governments of up to $200,000 per site to put them 
back to productive use. One such grant has been used to great success 
by Pittsburgh Mayor Tom Murphy, and I hope this provision will generate 
additional success stories of redeveloping urban brownfields.
  The Brownfields Program allows sites with minor levels of toxic waste 
to be cleaned up by State and local governments with federal and other 
funding sources. Companies and individuals who are interested in 
developing land into industrial, commercial, recreational, or 
residential use are often reluctant to purchase property with any level 
of toxic waste because of a fear of being saddled with cleanup 
liability under the Superfund law. Through expanded Brownfields grants, 
cleanup at such sites will be expedited and will encourage 
redevelopment of otherwise unusable urban property.
  My bill would also waive federal liability for persons who fully 
comply with a state cleanup plan to clean sites in urban areas pursuant 
to state law, providing that the site is not listed or proposed to be 
listed on the National Priorities List. Many states, including 
Pennsylvania, have developed their own toxic waste cleanup programs and 
have done good work to clean up many of these sites. Pennsylvania 
Governor Tom Ridge has developed an extensive plan, where contaminated 
sites are made safe based on sound science by returning the site to 
productive use through the development of uniform cleanup standards, by 
creating a set of standardized review procedures, by releasing owners 
and developers from liability who fully comply with the state cleanup 
standards and procedures, and by providing financial assistance. 
However, the efforts of states like Pennsylvania are often stifled 
because the federal government has not been willing to work with the 
States to release owners and developers from liability, even when they 
fully comply with the state plans.
  This section of my bill only applies to sites that are not on the 
National Priorities List. These are sites that the state has identified 
for which the state has created a comprehensive cleanup plan. If the 
federal government has concerns with the cleanup procedure or the 
safety of the site, then the government has full authority to place 
that site on the National Priority List. The plans, like that developed 
by Governor Ridge, deal with sites not controlled by the Superfund law. 
By not allowing the individual states to take the initiative to clean 
up these sites, and by not providing a waiver for federal liability to 
those who fully comply with the procedures and standards of the state 
cleanup, the federal government impedes the efforts of the states to 
work to clean up their own sites. This provision takes a significant 
step toward encouraging states to take the responsibility for their 
toxic waste sites and to encourage the effective cleanup of these sites 
in our nation's urban areas.
  The final environmental provision calls for the reauthorization of an 
existing federal program, which has served cities across the nation 
very well, but has not been authorized since 1995 and has also been 
unable to meet the demand for an ``urban greening effort.'' The Urban 
and Community Forestry Assistance Program through the U.S. Department 
of Agriculture provides financial and technical assistance to urban 
areas to help establish and maintain community parkland and forests in 
our nation's 45,000 towns and cities. The number of requests for 
federal assistance and grants exceeds the capacity of the existing 
Urban and Community Forestry program by eight times. The number of 
communities assisted through the Urban and Community Forestry 
Assistance Program has grown from 7,548 in Fiscal Year 1992 to 11,675 
in Fiscal Year 1997, a 56% increase in five years. An enhanced Urban 
and Community Forestry Program will enable cities to put vacant

[[Page S406]]

areas and abandoned structures back into use. There are more than 
15,000 vacant lots in Pennsylvania, which as we know, pose serious 
health and safety risks, detract commercial investments, reduce 
property values, and cost municipalities hundreds of millions of 
dollars in maintenance and lost revenue. The Urban and Community 
Forestry Program has been very successful due to its flexible design 
and emphasis on local creativity. In fact, the program has allowed for 
benefits that go beyond revenue and other economic gains. Many of the 
formerly broken down concrete lots are now green and welcoming to the 
community have provided children and their parents with a safe haven 
for recreation outside the home. Some city public schools have even 
begun to use these areas as their ``science parks'' for after-school 
and weekend educational activities.
  Mr. President, I realize that this is an initial step to reinvesting 
in our cities. Nevertheless, it is time to take a comprehensive 
approach to reversing urban decay, which is what I believe my bill can 
accomplish. It may well be that America has given up on its cities. 
That is a stark statement, but it is one which I believe may be true--
that America has given up on its cities. But this Senator has not done 
so. And I believe there are others in this body on both sides of the 
aisle who have not done so and I invite the input and assistance of my 
colleagues in order to fashion a strong plan of action to help cities 
to face their pressing problems.
  As one of a handful of United States Senators who lives in a big 
city, I understand both the problems and the promise of urban America. 
This legislation for our cities is good public policy. The plight of 
our cities must be of extreme concern to America. We can ill-afford for 
them to wither and die. I am committed to a new urban agenda that 
relies on market forces, and not a welfare state, for urban 
revitalization.
  I ask unanimous consent that a summary of the bill be printed in the 
Record.
  There being no objection, the summary was ordered to be printed in 
the Record, as follows:

                 New Urban Agenda Act of 1999--Summary


              Title I--Promote Urban Economic Development

       Requires a portion of federal and foreign aid purchases 
     (not less than 15 percent) to be from businesses operating in 
     urban zones, and commits the government to purchase recycled 
     products from businesses operating in urban zones.
       Requires an urban impact statement, with Presidential 
     approval, that details the impact on cities of agency 
     downsizing or relocation. Under the bill, a ``distressed 
     urban area'' follows HUD's definition, namely any city having 
     a population of more than 100,000.


    Title II--Tax Incentives To Stimulate Urban Economic Development

       Expands the Historic Rehabilitation Tax Credit which was 
     reduced in 1986. It would restore the issuance of tax-free 
     industrial development bonds and would allow cities to keep 
     the arbitrage earned from the issuance of tax-free municipal 
     bonds. Currently, local governments are required to rebate to 
     the federal government arbitrage earned from the issuance of 
     tax-free municipal bonds, and often spend more on compliance 
     than on the actual rebate.
       To encourage businesses to invest and locate in our 
     nation's cities, provides a 50 percent exclusion for capital 
     gains tax purposes for any gain resulting from targeted 
     investments in small businesses located in urban empowerment 
     zones, enterprise communities, or enterprise zones. The 
     exclusion also extends to any venture that invest in those 
     small businesses.


             Title III--Community-Based Housing Development

       Lifts Federal restrictions on community-based housing 
     development.
       To boost the efficiency of regional housing authorities, a 
     study would be done to streamline current and future housing 
     programs into ``block grants.''
       Provides a tax credit to encourage the purchase and 
     ownership of homes in distressed urban areas.


          Title IV--Response to Urban Environmental Challenges

       Reforms Superfund law to encourage industrial cleanup. 
     Authorizes an expanded federal brownfields grant program to 
     help clean up idle or underused industrial and commercial 
     facilities. Also provides regulatory relief by waiving 
     federal liability for businesses and individuals that fully 
     comply with a state cleanup plan to clean sites in urban 
     areas pursuant to state law, provided that the site is not 
     listed or proposed to be listed on the National Priorities 
     List.
       Reauthorizes the Urban and Community Forestry Assistance 
     Program to provide cities with the financial and technical 
     assistance necessary to revitalize abandoned, heavily 
     littered and demolished lands.
                                 ______