[House Report 107-180]
[From the U.S. Government Publishing Office]



107th Congress                                                   Report
                        HOUSE OF REPRESENTATIVES
 1st Session                                                    107-180

======================================================================



 
      APPALACHIAN REGIONAL DEVELOPMENT REAUTHORIZATION ACT OF 2001

                                _______
                                

 August 1, 2001.--Committed to the Committee of the Whole House on the 
              State of the Union and ordered to be printed

                                _______
                                

     Mr. Young of Alaska, from the Committee on Transportation and 
                Infrastructure, submitted the following

                              R E P O R T

                        [To accompany H.R. 2501]

      [Including cost estimate of the Congressional Budget Office]

  The Committee on Transportation and Infrastructure, to whom 
was referred the bill (H.R. 2501) to reauthorize the 
Appalachian Regional Development Act of 1965, having considered 
the same, report favorably thereon without amendment and 
recommend that the bill do pass.

                 Purpose and Summary of the Legislation

    H.R. 2501, the ``Appalachian Regional Development 
Reauthorization Act of 2001,'' amends the Appalachian Regional 
Development Act of 1965 (ARDA) to extend the authorization for 
the Appalachian Regional Commission (ARC) through fiscal year 
2006. The bill also revises and updates ARDA to reflect new 
initiatives and better target ARC resources to economically 
distressed communities.
    The Committee recognizes the need for continued federal 
assistance to economically distressed communities in 
Appalachia. This bill targets these communities in several ways 
including providing the Appalachian region with tools to 
compete in the changing economy and requiring ARC to direct at 
least fifty percent of its project funds toward activities in 
distressed counties and areas.

                     Background on the Legislation

    During the Subcommittee's hearing on June 20, 2001 on ARC's 
reauthorization, the Committee received extensive testimony 
regarding the progress ARC's programs have made in Appalachia. 
While ARC has accomplished a great deal over the past 35 years, 
there is still much to be done to bring Appalachia's economy to 
the national average. For this reason, the Committee strongly 
endorses the need for the continuation of the ARC's programs. 
The economic prosperity enjoyed by the Nation during the 1990s 
did not reach all of Appalachia, and ARC has continued to 
assist the region through its federal-state-local partnership. 
In recent years, Appalachia has endured great economic hardship 
resulting from the loss of its major industry. ARC is assisting 
the region to assimilate to the change through coordinated 
regional planning and innovative proposals, which have resulted 
in successful sustaining projects designed to replace coal 
mining and other dying industries.
    ARC has significantly improved the lives of Appalachians. 
In recognition of ARC's achievements, the Commission served as 
a model for creating the newly established Delta Regional 
Authority. ARC's success lies in its ability to involve each 
level of government in project identification and funding. The 
partnership between ARC federal co-chairman and 13 member state 
governors requires federal and state representatives to share 
equally in making policy decisions, approving state development 
plans, and allocating funds. Each state submits an annual state 
development plan, which includes a list of projects to be 
completed within the state. The plan is subject to review and 
subsequent approval by the majority of the Commission. Since 
all funding decisions are made jointly by the states and the 
federal government, ARC is cited as a model program for 
devolving funding decisions back to the states.
    The ARC was established to address the unique problems 
faced by the isolated Appalachian region, which separates it 
from the economic mainstream. ARC's regional approach to 
economic development enables states to work cooperatively to 
address issues unique to the region. Due to its economic 
distress, many Appalachian communities lack basic resources 
needed to match other federal programs. ARC is able to provide 
funds to these distressed areas at an 80 percent matching rate. 
Ultimately, ARC is able to succeed because it responds to 
identified and agreed upon needs, and is extremely flexible in 
its approach. ARC also leverages its funds to provide resources 
to bundle multiple federal programs.
    Prior to the reauthorization passed in 1998, the 
Appalachian Regional Commission was funded by appropriators, 
but remained unauthorized for 17 years, despite Committee 
efforts to reauthorize the program. By the time of the 
reauthorization, many issues had been identified through 
continued oversight over the Commission. Reforms implemented in 
the 1998 reauthorization targeted these issues and focused 
ARC's funding efforts on communities in the greatest need. One 
important reform required ARC to designate the poorest counties 
in Appalachia as ``distressed'' and designate those counties 
that had achieved parity with the rest of the Nation as 
``economically strong.''
    ARC's programs affect 406 counties located in thirteen 
states, including all of West Virginia and parts of Alabama, 
Georgia, Kentucky, Maryland, Mississippi, New York, North 
Carolina, Ohio, Pennsylvania, South Carolina, Tennessee, and 
Virginia. The region contains nearly 200,000 square miles and 
22 million people. ARC reviews each of these counties on an 
annual basis to determine which designation each county 
receives--distressed, transitional, competitive or attainment. 
A county is classified according to a comparison with the 
national average on unemployment, poverty rate and per capita 
market income. Distressed counties have a three-year average 
unemployment rate that is at least 150% of the national 
average, a poverty rate at least 150% of the national average, 
and a per capita market income of no more than two-thirds of 
the national average. Currently, of ARC's 406 counties, 114 are 
considered to be distressed.
    H.R. 2501 continues the Committee's previous focus on 
distressed counties, requiring ARC to deliver at least half of 
its program funds to activities in distressed counties and 
areas. In the past, ARC was given wide latitude to define the 
categories of ``distressed'' and ``economically strong,'' and 
has shown great diligence in ensuring that these categories 
have meaning in the scope of their program decisions. These 
definitions are based on three factors: employment, poverty and 
per capita market income. The Committee expects ARC to identify 
similar factors to be relied upon for implementation of funding 
in distressed areas that may not be located within the confines 
of a distressed county. These areas are currently described in 
ARDA as ``severely and persistently distressed,'' but lack a 
statutory definition. The Committee notes that while an entire 
county may not qualify as ``distressed,'' there may be pockets 
of economic distress within a county in need of assistance. 
Therefore, these pockets should be included in the fifty 
percent funding target. The Committee notes that while ARC 
focuses on funding projects in distressed areas, it should do 
so while continuing to utilize a regional approach to economic 
development.
    H.R. 2501 does not alter any current authorizations or 
authorities affecting the 3,025 mile Appalachian Development 
Highway System. The Transportation Equity Act for the 21st 
Century (TEA-21) has already provided necessary amendments for 
the highway program. As such, the amendments in H.R. 2501 focus 
on ARC's administration and area development program.
    Testimony received during the Committee hearing illustrated 
the progress ARC has made implementing the 1998 reauthorization 
reforms. As such, the Committee reauthorizes ARC for a period 
of five years and provides ARC with additional funding to 
assist Appalachian residents to acquire better access to 
telecommunications and technology, thereby enabling the region 
to participate in the changing economy.

                               H.R. 2501

    The Committee notes that ARC is one of several federal 
agencies administering economic development programs in 
Appalachia. While ARC's programs are administered according to 
regional development plans and are approved according to state 
development plans, other federal economic programs in the 
region may provide assistance that is not reflected in these 
plans. As such, the Committee recognizes the need for 
coordination of these economic development projects and 
provides for the creation of a council to bring federal 
agencies together to organize the delivery of federal economic 
development projects in the region.
    While much of the Nation is experiencing the benefits of 
access to technology and telecommunications, Appalachia has 
extremely limited access to these assets. H.R. 2501 provides 
ARC with the authority to provide technical assistance and 
provide funds to increase affordable access to advanced 
telecommunications, provide education and training, assist 
industry groups and businesses in preparing to utilize 
technology, and support entrepreneurial opportunities in the 
region. The Committee authorizes $10 million for FY 2002 and 
such sums as may be necessary through 2006. The Committee 
anticipates that this initiative will enable Appalachians to 
compete in the changing economy.
    H.R. 2501 also continues the theme of the 1998 
Reauthorization by requiring ARC to direct at least half of its 
project funds to activities in distressed counties. The 
Committee notes that it does not intend to exclude pockets of 
distress that may exist within counties that on the whole do 
not qualify under the requirements as distressed. Instead, the 
Committee directs ARC to provide a definition for a distressed 
area, which would also be eligible for funding under this 
targeted requirement. The Committee grants ARC the discretion 
to establish this definition based on ARC's current commitment 
to target funds to distressed areas. Nevertheless, the 
Committee intends to closely monitor the designation process 
used by the Commission to assess whether further statutory 
guidance may be needed. Local Development Districts (LDDs) that 
include a distressed county will also benefit from H.R. 2501. 
LDDs that include a distressed county are eligible for an 
increased federal cost share of 75 percent for administrative 
expenses. The bill also makes technical amendments to update 
program terminology and to eliminate references to outdated 
programs.
    The Committee authorizes ARC for five years ending in FY 
2006. Total authorizations for ARC are $78 million for FY 2002, 
$80 million for FY 2003, $83 million for FY 2004, $85 million 
for FY 2005 and $87 million for FY 2006.

                      Section-by-Section Analysis


Section 1. Short title

    The Act may be cited as the ``Appalachian Regional 
Development Reauthorization Act of 2001.'' All amendments are 
made to the Appalachian Regional Development Act of 1965.

Section 2. Coordination of Appalachian regional development programs

    Requires the President to create the ``Interagency 
Coordinating Council on Appalachia'' to coordinate federal 
economic development programs in the Appalachian region. The 
council will be chaired by the Appalachian Regional Commission 
(ARC) federal cochairman and will consist of representatives of 
federal departments and agencies carrying out economic 
development programs in Appalachia.

Section 3. Telecommunications and technology

    Enables ARC to provide technical assistance, make grants, 
enter into contracts and otherwise provide funds to increase 
affordable access to advanced telecommunications in the region; 
provide education and training for people, businesses and 
governments in telecommunications technology; develop relevant 
technology readiness programs for industry groups and 
businesses; and support entrepreneurial opportunities in 
information technology in the region. The program is authorized 
for 2002 at $10 million and such sums as may be necessary 
through 2006.

Section 4. Program development criteria

    Requires ARC to distribute at least half of its project 
grant funds to distressed counties.

Section 5. Grants for administrative expenses of local development 
        districts (LDDs)

    Provides grants for administrative expenses at 75% federal 
share for development districts that include one or more 
counties designated as distressed. LDDs that do not contain a 
distressed county remain eligible for administrative expense 
grants at a 50/50 cost share.

Section 6. Addition of counties to Appalachian region

    Expands ARC's jurisdiction to include six additional 
counties.

Section 7. Technical amendments

    Updates terminology by replacing outdated terms including 
``implementing investment program'' and ``development program'' 
with ``strategy statement'' and ``development strategy.'' 
Provides ARC with the authority to lease office space for a 
term exceeding its authorization period. Eliminates references 
to federal grant in aid programs no longer in existence or not 
used by ARC. Eliminates references to repealed authorities.

Section 8. Authorization of appropriations

    Provides authorization of appropriations in the amount of 
$78 million for FY 2002, $80 million for FY 2003, $83 million 
for FY 2004, $85 million for FY 2005 and $87 million for FY 
2006.

Section 9. Termination

    Extends the date the Appalachian Regional Development Act 
will cease to be in effect to October 1, 2006.

                                Hearings

    The Subcommittee on Economic Development, Public Buildings 
and Emergency Management held a hearing on the reauthorization 
of the Appalachian Regional Commission on June 20, 2001. 
Witnesses at this hearing included the federal and state co-
chairmen, a former state co-chairman, a representative from a 
local development district and an individual from a county 
development organization. Testimony from this hearing 
illustrated the important work ARC has completed through its 
partnerships with states to improve economic conditions in 
highly distressed areas.

                        Committee Consideration

    H.R. 2501 was introduced on July 16, 2001. The Subcommittee 
on Economic Development, Public Buildings and Emergency 
Management favorably reported the bill by unanimous voice vote 
with no amendments on July 17, 2001. On July 18, 2001, the Full 
Committee met in open session and ordered reported H.R. 2501 
unanimously by voice vote with no amendments.

                            Roll Call Votes

    Clause 3(b) of rule XIII requires each committee report to 
include the total number of votes cast for and against on each 
roll call vote on a motion to report and on any amendment 
offered to the measure or matter, and the names of those 
members voting for and against. There were no recorded votes 
taken in connection with ordering H.R. 2501 reported. A motion 
by Congressman Steven C. LaTourette to order H.R. 2501 reported 
to the House was unanimously agreed to by voice vote, a quorum 
being present.

                      Committee Oversight Findings

    With respect to the requirements of clause 3(c)(1) of rule 
XIII of the Rules of the House of Representatives, the 
Committee's oversight findings and recommendations are 
reflected in this report.

                        Cost of the Legislation

    Clause 3(d)(2) of rule XIII of the Rules of the House of 
Representatives does not apply where a cost estimate and 
comparison prepared by the Director of the Congressional Budget 
Office under section 402 of the Congressional Budget Act of 
1974 has been timely submitted prior to the filing of the 
report and is included in the report. Such a cost estimate is 
included in this report.

                    Compliance With House Rule XIII

    1. With respect to the requirement of clause 3(c)(2) of 
rule XIII of the Rules of the House of Representatives, and 
308(a) of the Congressional Budget Act of 1974, the Committee 
references the report of the Congressional Budget Office (CBO) 
included below.
    2. With respect to the requirement of clause 3(c)(4) of 
rule XIII of the Rules of the House of Representatives, the 
performance goals and objective of this legislation are to 
extend the authorization of the Appalachian Regional Commission 
and to make amendments.
    3. With respect to the requirement of clause 3(c)(3) of 
rule XIII of the Rules of the House of Representatives and 
section 402 of the Congressional Budget Act of 1974, the 
Committee has received the following cost estimate for H.R. 
2501 from the Director of the Congressional Budget Office.

                                     U.S. Congress,
                               Congressional Budget Office,
                                     Washington, DC, July 26, 2001.
Hon. Don Young,
Chairman, Committee on Transportation and Infrastructure,
House of Representatives, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for H.R. 2501, the 
Appalachian Regional Development Reauthorization Act of 2001.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contact is Lanette. J. 
Walker.
            Sincerely,
                                        Steven M. Lieberman
                                    (For Dan L. Crippen, Director).
    Enclosure.

               CONGRESSIONAL BUDGET OFFICE COST ESTIMATE

H.R. 2501--Appalachian Regional Development Reauthorization Act of 2001

    Summary: CBO estimates that H.R. 2501 would authorize the 
appropriation of $473 million for the Appalachian Regional 
Commission over the 2002-2006 period. The bill would establish 
an Interagency Coordinating Council on Appalachia and create a 
program to provide enhanced access to telecommunications and 
technology. H.R. 2501 also would expand the definition of the 
region to include six additional counties: three in Kentucky 
and three in Mississippi. Under H.R. 2501, these six counties 
would be eligible to receive grants from the commission. CBO 
estimates that implementing H.R. 2501 would cost $246 million 
over the 2002-2006 period, assuming the appropriation of the 
necessary amounts. Because this bill would not affect direct 
spending or receipts, pay-as-you-go procedures would not apply.
    H.R. 2501 contains no intergovernmental or private-sector 
mandates as defined in the Unfunded Mandates Reform Act (UMRA). 
New authorizations of appropriations totaling $413 million over 
the 2002-2006 period would support a variety of grant programs 
to state and local governments in the Appalachian region. In 
addition, CBO estimates that a total of $60 million would be 
authorized over the 2002-2006 period for telecommunications and 
technology assistance to those governments. Any costs 
associated with applying for or implementing those grants would 
be voluntary.
    Estimated cost to the Federal Government: The estimated 
budgetary impact of H.R. 2501 is shown in the following table. 
The costs of this legislation fall within budget function 450 
(community and regional development).

----------------------------------------------------------------------------------------------------------------
                                                                  By fiscal year, in millions of dollars--
                                                           -----------------------------------------------------
                                                              2001     2002     2003     2004     2005     2006
----------------------------------------------------------------------------------------------------------------
                                        SPENDING SUBJECT TO APPROPRIATION

Spending under current law for the Appalachian Regional
 Commission:
    Budget authority \1\..................................       77        0        0        0        0        0
    Estimated outlays.....................................      118       92       66       36       18        7
Proposed changes:
    Estimated authorization level.........................        0       88       91       95       98      101
    Estimated outlays.....................................        0        9       27       54       71       85
Spending under H.R. 2501 for the Appalachian Regional
 Commission:
    Estimated authorization level \1\.....................       77       88       91       95       98      101
    Estimated outlays.....................................      118      101       93       90       89       92
----------------------------------------------------------------------------------------------------------------
\1\ The 2001 level is the amount appropriated for that year for the Appalachian Regional Commission.

    Basis of estimate: For this estimate we assume the 
necessary amounts will be provided each year and that spending 
will follow historical patterns. CBO estimates that 
implementing H.R. 2501 would cost $246 million over the next 
five years
    H.R. 2501 would authorize the appropriation of $413 million 
over the 2002-2006 period for the Appalachian Regional 
Commission to provide grants to state and local governments to 
support economic and social development within Appalachia. In 
addition, the bill would create a program to provide enhanced 
access to telecommunications and technology and authorize the 
appropriation of $10 million in fiscal year 2002 and such sums 
as are necessary over 2003-2006 period. Assuming annual 
adjustments for anticipated inflation, we estimate that this 
provision of H.R. 2501 would authorize the appropriation of $60 
million over the five-year period for this new program.
    Pay-as-you-go considerations: None.
    Intergovernmental and private-sector impact: H.R. 2501 
contains no intergovernmental or private-sector mandates as 
defined in UMRA. New authorizations of appropriations totaling 
$413 million over the 2002-2006 period would support a variety 
of grant programs to state and local governments in the 
Appalachian region. In addition, CBO estimates that a total of 
$60 million would be authorized over the 2002-2006 period for 
telecommunications and technology assistance to those 
governments. Any costs associated with applying for or 
implementing those grants would be voluntary.
    Estimate prepared by: Federal Costs: Lanette J. Walker; 
Impact on State, Local, and Tribal Governments: Leo Lex; Impact 
on the Private Sector: Cecil McPherson.
    Estimate approved by: Peter H. Fontaine, Deputy Assistant 
Director for Budget Analysis.

                   Constitutional Authority Statement

    Pursuant to clause 3(d)(1) of rule XIII of the Rules of the 
House of Representatives, committee reports on a bill or joint 
resolution of a public character shall include a statement 
citing the specific powers granted to the Congress in the 
Constitution to enact the measure. The Committee on 
Transportation and Infrastructure finds that Congress has the 
authority to enact this measure pursuant to its powers granted 
under article I, section 8 of the Constitution.

                       Federal Mandates Statement

    The Committee adopts as its own the estimate of federal 
mandates prepared by the Director of the Congressional Budget 
Office pursuant to section 423 of the Unfunded Mandates Reform 
Act (P.L. 104-4).

                      Advisory Committee Statement

    No advisory committees within the meaning of section 5(b) 
of the Federal Advisory Committee Act were created by this 
legislation.

                Applicability to the Legislative Branch

    The Committee finds that the legislation does not relate to 
the terms and conditions of employment or access to public 
services or accommodations within the meaning of section 
102(b)(3) of the Congressional Accountability Act (P.L. 104-1).

         Changes in Existing Law Made by the Bill, as Reported

  In compliance with clause 3(e) of rule XIII of the Rules of 
the House of Representatives, changes in existing law made by 
the bill, as reported, are shown as follows (existing law 
proposed to be omitted is enclosed in black brackets, new 
matter is printed in italic, existing law in which no change is 
proposed is shown in roman):

              APPALACHIAN REGIONAL DEVELOPMENT ACT OF 1965

           *       *       *       *       *       *       *



              TITLE I--THE APPALACHIAN REGIONAL COMMISSION


                         membership and voting

  Sec. 101. (a) * * *
  (b) Except as provided in section 105, decisions by the 
Commission shall require the affirmative vote of the Federal 
Cochairman and of a majority of the State members (exclusive of 
members representing States delinquent under section 105). In 
matters coming before the Commission, the Federal Cochairman 
shall, to the extent practicable, consult with the Federal 
departments and agencies having an interest in the subject 
matter. A decision involving Commission policy, approval of any 
State, regional, or subregional development plan or 
[implementing investment program] strategy statement, any 
modification or revision of the Appalachian Regional Commission 
Code, any allocation of funds among the States, or any 
designation of a distressed county or an economically strong 
county shall not be made without a quorum of the State members. 
The approval of project and grant proposals shall be a 
responsibility of the Commission and exercised in accordance 
with section 303 of this Act.

           *       *       *       *       *       *       *


                      functions of the commission

  Sec. 102. (a) In carrying out the purposes of this Act, the 
Commission shall--
          (1) * * *

           *       *       *       *       *       *       *

          (5) encourage the formation and support of local 
        development districts;

           *       *       *       *       *       *       *


         [liaison between federal government and the commission

  [Sec. 104. The President]

SEC. 104. COORDINATION OF APPALACHIAN REGIONAL DEVELOPMENT PROGRAMS.

  (a) Liaison Between Federal Government and Commission.--The 
President shall provide effective and continuing liaison 
between the Federal Government and the Commission and a 
coordinated review within the Federal Government of the plans 
and recommendations submitted by the Commission pursuant to 
sections 102 and 103.
  (b) Interagency Coordinating Council.--
          (1) In general.--In carrying out subsection (a), the 
        President shall establish an interagency council to be 
        known as the ``Interagency Coordinating Council on 
        Appalachia''.
          (2) Membership.--The Council shall be composed of--
                  (A) the Federal Cochairman, who shall serve 
                as Chairperson of the Council; and
                  (B) representatives of Federal agencies that 
                carry out economic development programs in the 
                Appalachian region.

           *       *       *       *       *       *       *


                  administrative powers of commission

  Sec. 106. To carry out its duties under this Act, the 
Commission is authorized to--
          (1) * * *

           *       *       *       *       *       *       *

          (7) enter into and perform such contracts, leases 
        (including notwithstanding any other provision of law, 
        the lease of office space [for any term expiring no 
        later than September 30, 2001]), cooperative 
        agreements, or other transactions as may be necessary 
        in carrying out its functions and on such terms as it 
        may deem appropriate, with any department, agency, or 
        instrumentality of the United States (which is hereby 
        so authorized to the extent not otherwise prohibited by 
        law) or with any State, or any political subdivision, 
        agency, or instrumentality thereof, or with any person, 
        firm, association, or corporation.

           *       *       *       *       *       *       *


                 TITLE II--SPECIAL APPALACHIAN PROGRAMS

Part A--New Programs

           *       *       *       *       *       *       *


SEC. 203. TELECOMMUNICATIONS AND TECHNOLOGY.

  (a) In General.--In order to ensure that the people and 
businesses of the Appalachian region have the knowledge, 
skills, and access to telecommunications services to compete in 
the technology-based economy, the Commission may provide 
technical assistance and make grants, enter into contracts, and 
otherwise provide funds for the following purposes:
          (1) To increase affordable access to advanced 
        telecommunications in the region.
          (2) To provide education and training for people, 
        businesses, and governments in the region in the use of 
        telecommunications technology.
          (3) To develop relevant technology readiness programs 
        for industry groups and businesses in the region.
          (4) To support entrepreneurial opportunities in 
        information technology in the region.
  (b) Sources of Funding.--Assistance provided under this 
section may be provided entirely from appropriations made 
available to carry out this section or in combination with 
funds available under a Federal grant-in-aid program (as 
defined in section 214(c)), under another Federal program, or 
from any other source.
  (c) Federal Share Limitations Specified in Other Laws.--
Notwithstanding any provision of law limiting the Federal share 
in a Federal grant-in-aid program or other Federal program, 
funds appropriated to carry out this section may be used to 
increase such Federal share, as the Commission determines 
appropriate.
  (d) Authorization of Appropriations.--There is authorized to 
be appropriated to the Commission to carry out this section 
$10,000,000 for fiscal year 2002 and such sums as may be 
necessary for fiscal years 2003 through 2006. Such sums shall 
remain available until expended.

           *       *       *       *       *       *       *


Part B--Supplementations and Modifications of Existing Programs

           *       *       *       *       *       *       *


              supplements to federal grant-in-aid programs

  Sec. 214. (a) In order to enable the people, States, and 
local communities of the region, including local development 
districts, to take maximum advantage of Federal grant-in-aid 
programs (as hereinafter defined) for which they are eligible 
but for which, because of their economic situation, they cannot 
supply the required matching share, or for which there are 
insufficient funds available under the Federal grant-in-aid Act 
authorizing such programs to meet pressing needs of the region, 
the Federal Cochairman may use amounts made available to carry 
out this section for all or any portion of the basic Federal 
contribution to projects or activities (hereinafter referred to 
as projects) under such Federal grant-in-aid programs 
authorized by Federal grant-in-aid Acts, and for the purpose of 
increasing the Federal contribution to projects under such 
programs, as hereafter defined, above the fixed maximum portion 
of the cost of such projects otherwise authorized by the 
applicable law. In the case of any program or project for which 
all or any portion of the basic Federal contribution to the 
project under a Federal grant-in-aid program is proposed to be 
made under this subsection, no such Federal contribution shall 
be made until the responsible Federal official administering 
the Federal grant-in-aid Act authorizing such contribution 
certifies that such program or project meets the applicable 
requirements of such Federal grant-in-aid Act and could be 
approved for Federal contribution under such Act if funds were 
available under such Act for such program or project. [Funds 
may be provided for programs and projects in a State under this 
subsection only if the Commission determines that the level of 
Federal and State financial assistance under Acts other than 
this Act, for the same type of programs or projects in that 
portion of the State within the region, will not be diminished 
in order to substitute funds authorized by this subsection.] 
Funds provided pursuant to this Act shall be available without 
regard to any limitations on areas eligible for assistance or 
authorizations for appropriation in any other Act. Any 
findings, report, certification, or documentation required to 
be submitted to the head of the department, agency, or 
instrumentality of the Federal Government responsible for the 
administration of any Federal grant-in-aid program shall be 
accepted by the Federal Cochairman with respect to a 
supplemental grant for any project under such program.

           *       *       *       *       *       *       *

  [(c) The term ``Federal grant-in-aid programs'' as used in 
this section means those Federal grant-in-aid programs 
authorized by this Act and Acts other than this Act for the 
acquisition or development of land, the construction or 
equipment of facilities, or other community or economic 
development or economic adjustment activities, including but 
not limited to grant-in-aid programs authorized by the 
following Acts: Federal Water Pollution Control Act; Watershed 
Protection and Flood Prevention Act; titles VI and XVI of the 
Public Health Services Act; Vocational Education Act of 1963; 
Federal Airport Act; Airport and Airway Development Act of 
1970; part IV of title III of the Communications Act of 1934; 
title VI (part A) and VII of the Higher Education Act of 1965; 
Land and Water Conservation Fund Act of 1965; National Defense 
Education Act of 1958; Consolidated Farm and Rural Development 
Act; sections 201 and 209 of the Public Works and Economic 
Development Act of 1965; the housing repair program for 
homeowners authorized by section 1319 of title 42, United 
States Code; grants under the Indian Health Service Act (42 
Stat. 208); and title I of the Housing and Community 
Development Act of 1974. The term shall not include (A) the 
program for the construction of the development highway system 
authorized by section 201 of this Act or any program relating 
to highway or road construction authorized by title 23, United 
States Code or (B) any other program for which loans or other 
Federal financial assistance, except a grant-in-aid program, is 
authorized by this or any other Act. For the purpose of this 
section, any sewage treatment works constructed pursuant to 
section 8(c) of the Federal Water Pollution Control Act without 
Federal grant-in-aid assistance under such section shall be 
regarded as if constructed with such assistance.
  [(d) Not to exceed $97,000,000 of the funds authorized in 
section 401 of this Act for the two-fiscal-year period ending 
June 30, 1969, shall be available to carry out this section.]
  (c) Federal Grant-In-Aid Programs Defined.--
          (1) Included programs.--In this section, the term 
        ``Federal grant-in-aid programs'' means those Federal 
        grant-in-aid programs authorized by this Act or another 
        Act for the acquisition or development of land, the 
        construction or equipment of facilities, or other 
        community or economic development or economic 
        adjustment activities, including but not limited to 
        grant-in-aid programs authorized by the following Acts:
                  (A) The Federal Water Pollution Control Act 
                (33 U.S.C. 1251 et seq.).
                  (B) The Watershed Protection and Flood 
                Prevention Act (16 U.S.C. 1001 et seq.).
                  (C) Title VI of the Public Health Services 
                Act (42 U.S.C. 291 et seq.).
                  (D) The Carl D. Perkins Vocational and 
                Technical Education Act of 1998 (20 U.S.C. 2301 
                et seq.).
                  (E) Part IV of title III of the 
                Communications Act of 1934 (47 U.S.C. 390 et 
                seq.).
                  (F) The Land and Water Conservation Fund Act 
                of 1965 (16 U.S.C 460l-4 et seq.).
                  (G) The Consolidated Farm and Rural 
                Development Act (7 U.S.C. 1921 et seq.).
                  (H) Sections 201 and 209 of the Public Works 
                and Economic Development Act of 1965 (42 U.S.C. 
                3141 and 3149).
                  (I) Title I of the Housing and Community 
                Development Act of 1974 (42 U.S.C. 5301 et 
                seq.).
          (2) Excluded programs.--In this section, the term 
        ``Federal grant-in-aid programs'' does not include--
                  (A) the program for the construction of the 
                development highway system authorized by 
                section 201 or any program relating to highway 
                or road construction authorized by title 23, 
                United States Code; or
                  (B) any other program for which loans or 
                other Federal financial assistance, except a 
                grant-in-aid program, is authorized by this or 
                any other Act.

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                      Part C--General Provisions

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                      program development criteria

  Sec. 224. (a) In considering programs and projects to be 
given assistance under this Act, and in establishing a priority 
ranking of the requests for assistance presented to the 
Commission, the Commission shall follow procedures that will 
insure consideration of the following factors:
          (1) the relationship of the project or class of 
        projects to overall regional development including its 
        location [in an area determined by the State have a 
        significant potential for growth or] in a severely and 
        persistently distressed county or area;
          (2) the population and area to be served by the 
        project or class of projects including the relative per 
        capita market income and the unemployment rates in the 
        area;

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  (d) Assistance to Distressed Counties and Areas.--For each 
fiscal year, at least one-half of the amount of grant 
expenditures approved by the Commission under this Act shall 
support activities or projects that benefit counties for which 
distressed county designations are in effect under section 226.

             appalachian state development planning process

  Sec. 225. (a) Pursuant to policies established by the 
Commission, each State member shall submit on such schedule as 
the Commission shall prescribe a development plan for the area 
of the State within the region. The State development plan 
shall reflect the goals, objectives, and priorities identified 
in the regional development plan and in any subregional 
development plan which may be approved for the subregion of 
which such State is a part. Such State development plan shall 
(1) describe the State organization and continuous process for 
Appalachian development planning, including the procedures 
established by the State for the participation of local 
development districts in such process, the means by which such 
process is related to overall statewide planning and budgeting 
processes, and the method of coordinating planning and projects 
in the region under this Act, the Public Works and Economic 
Development Act of 1965, and other Federal, State, and local 
programs; (2) set forth the goals, objectives, and priorities 
of the State for the region, as determined by the Governor, and 
identify the needs on which such goals, objectives, and 
priorities are based; and [(3) describe the development 
program] (3) describe the development strategies for achieving 
such goals, objectives, and priorities, including funding 
sources, and recommendations for specific projects to receive 
assistance under this Act.

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  (c) To the maximum extent practicable, Federal departments, 
agencies, and instrumentalities undertaking or providing 
financial assistance for programs or projects in the region 
shall (1) take into account the policies, goals, and objectives 
established by the Commission and its member States pursuant to 
this Act; (2) recognize [Appalachian State development 
programs] Appalachian State development strategies approved by 
the Commission as satisfying requirements for overall economic 
development planning under such programs or projects; and (3) 
accept the boundaries and organization of any local development 
district certified under this Act which the Governor may 
designate as the areawide agency required under any such 
program undertaken or assisted by such Federal departments, 
agencies, and instrumentalities.

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                      TITLE III--ADMINISTRATION

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 grants for administration expenses of local development districts and 
                for research and demonstration projects

  Sec. 302. (a) Authorization To Make Grants.--
          (1) In general.--The Commission is authorized--
                  (A) to make grants for administrative 
                expenses, including the development of areawide 
                plans or action programs and technical 
                assistance activities, of local development 
                districts, but (i) the amount of any such grant 
                shall not exceed 50 percent (or 75 percent for 
                a development district that includes 1 or more 
                counties for which a distressed county 
                designation is in effect under section 226) of 
                such expenses, (ii) no grants for 
                administrative expenses shall be made for a 
                State agency certified as a local development 
                district for a period in excess of three years 
                beginning on the date the initial grant is made 
                for such development district, and (iii) the 
                local development district contributions for 
                administrative expenses may be in cash or in 
                kind, fairly evaluated, including but not 
                limited to space, equipment, and services;

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     approval of development plans, [investment programs] strategy 
                        statements, and projects

  Sec. 303. State and Regional Development Plans and 
[implementing investments programs] strategy statements, and 
any multistate subregional plans which may be developed, shall 
be annually reviewed and approved by the Commission in 
accordance with section 101(b) of this Act. An application for 
a grant or for any other assistance for a specific project 
under this Act shall be made through the State member of the 
Commission representing such applicant, and such State member 
shall evaluate the application for approval. Only applications 
for grants or other assistance for specific projects shall be 
approved which are certified by the State member and determined 
by the Federal Cochairman to implement the Commission-approved 
State development plan; to be included in the Commission-
approved [implementing investment program] strategy statement; 
to have adequate assurance that the project will be properly 
administered, operated, and maintained; and to otherwise meet 
the requirements for assistance under this Act. After the 
approval of the appropriate State development plan and 
[implementing investment program] strategy statement, 
certification by a State member of an application for a grant 
or other assistance for a specific project pursuant to this 
section shall, when joined by an affirmative vote of the 
Federal Cochairman for such project, be deemed to satisfy the 
requirements for affirmative votes for decisions under section 
101(b) of this Act.

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         TITLE IV--APPROPRIATIONS AND MISCELLANEOUS PROVISIONS

SEC. 401. AUTHORIZATION OF APPROPRIATIONS.

  [(a) In General.--In addition to amounts authorized by 
section 201 and other amounts made available for the 
Appalachian development highway system program, there are 
authorized to be appropriated to the Commission to carry out 
this Act--
          [(1) $68,000,000 for fiscal year 1999;
          [(2) $69,000,000 for fiscal year 2000; and
          [(3) $70,000,000 for fiscal year 2001.]
  (a) In General.--In addition to amounts authorized by section 
201 (and other amounts made available for the Appalachian 
development highway system program) and section 203, there are 
authorized to be appropriated to the Commission to carry out 
this Act--
          (1) $78,000,000 for fiscal year 2002;
          (2) $80,000,000 for fiscal year 2003;
          (3) $83,000,000 for fiscal year 2004;
          (4) $85,000,000 for fiscal year 2005; and
          (5) $87,000,000 for fiscal year 2006.

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                    definition of appalachian region

  Sec. 403. As used in this Act, the term ``Appalachian 
region'' or ``the region'' means that area of the eastern 
United States consisting of the following counties (including 
any political subdivision located within such area):
          In Alabama, the counties of Bibb, Blount, Calhoun, 
        Chambers, Cherokee, Chilton, Clay, Cleburne, Colbert, 
        Coosa, Cullman, De Kalb, Elmore, Etowah, Fayette, 
        Franklin, Hale, Jackson, Jefferson, Lamar, Lauderdale, 
        Lawrence, Limestone, Macon, Madison, Marion, Marshall, 
        Morgan, Pickens, Randolph, Saint Clair, Shelby, 
        Talladega, Tallapoosa, Tuscaloosa, Walker, and Winston;
          In Georgia, the counties of Banks, Barrow, Bartow, 
        Carroll, Catoosa, Chattooga, Cherokee, Dade, Dawson, 
        Douglas, Elbert, Fannin, Floyd, Forsyth, Franklin, 
        Gilmer, Gordon, Gwinnett, Habersham, Hall, Haralson, 
        Hart, Heard, Jackson, Lumpkin, Madison, Murray, 
        Paulding, Pickens, Polk, Rabun, Stephens, Towns, Union, 
        Walker, White, and Whitfield;
          In Kentucky, the counties of Adair, Bath, Bell, Boyd, 
        Breathitt, Carter, Casey, Clark, Clay, Clinton, 
        Cumberland, Edmonson, Elliott, Estill, Fleming, Floyd, 
        Garrard, Green, Greenup, Harlan, Hart, Jackson, 
        Johnson, Knott, Knox, Laurel, Lawrence, Lee, Leslie, 
        Letcher, Lewis, Lincoln, McCreary, Madison, Magoffin, 
        Martin, Menifee, Metcalfe, Monroe, Montgomery, Morgan, 
        Owsley, Perry, Pike, Powell, Pulaski, Rockcastle, 
        Rowan, Russell, Wayne, Whitley, and Wolfe;
          In Maryland, the counties of Allegany, Garrett, and 
        Washington;
          In Mississippi the counties of Alcorn, Benton, 
        Calhoun, Chickasaw, Choctaw, Clay, Grenada, Itawamba, 
        Kemper, Lee, Lowndes, Marshall, Monroe, Montgomery, 
        Noxubee, Oktibbeha Pontotoc, Panola, Prentiss, Tippah, 
        Tishomingo, Union, Webster, Winston, and Yalobusha;

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                              termination

  Sec. 405. This Act, other than sections 201 and 403, shall 
cease to be in effect on October 1, [2001] 2006.

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