[Senate Report 107-290]
[From the U.S. Government Publishing Office]



                                                       Calendar No. 610
107th Congress                                                   Report
                                 SENATE
 2d Session                                                     107-290
======================================================================
 
                    COMMUNITY CHARACTER ACT OF 2002

                                _______
                                

               September 18, 2002.--Ordered to be printed

                                _______
                                

   Mr. Jeffords, from the Committee on Environment and Public Works, 
                        submitted the following

                              R E P O R T

                             together with

                             MINORITY VIEWS

                         [to accompany S. 975]

      [Including cost estimate of the Congressional Budget Office]

    The Committee on Environment and Public Works, to which was 
referred a bill (S. 975) to improve environmental policy by 
providing assistance for State and tribal land use planning, to 
promote improved quality of life, regionalism, and sustainable 
economic development, and for other purposes, having considered 
the same reports favorably thereon with an amendment and 
recommends that the bill, as amended, do pass.

                    General Statement and Background

    Since its inception, our Nation has been expanding, both 
economically and demographically. America has grown from East 
to West, as well as from an urban setting to suburban one. 
After the second World War, waves of returning soldiers--
looking for a better life for themselves and their families--
helped create a unprecedented building boom in the United 
States. Farms and open spaces across America were turned into 
massive tracts of new houses as the Nation experienced 
explosive growth.
    In the wake of the post-World War II building boom, towns 
across the country experienced the type of development that too 
often offends the eye and saps our economic strength. Due to a 
lack of planning, incremental and haphazard development 
occurred through a mixture of incompatible zoning decisions. 
Industrial and commercial facilities and residential homes were 
frequently and inappropriately sited next to each other. In 
many areas, State and local governments strained by explosive 
growth learned that proper approaches to planning can help meet 
its challenges, whether it is preserving limited open space in 
the East or protecting precious drinking water supplies in the 
West.
    Cities and towns across America are facing a difficult 
choice between development and the preservation of community 
character. Since 1990, the rates of population growth in some 
communities across America have been staggering: Las Vegas, NV, 
83 percent; Naples, FL, 65 percent; Austin, TX, 48 percent; 
Boise, ID, 46 percent; Phoenix, AZ, 45 percent; Provo, UT 40 
percent; Atlanta, GA, 39 percent; Wilmington, NC, 36 percent, 
and Denver, CO, 30 percent.
    Factors contributing to the Nation's sweeping growth 
include a strong economy and transportation and technology 
advancements that allow people to live greater distances from 
work. Due in part to inadequate planning, strip malls and 
retail development catering to the automobile have become the 
trademark of the American landscape.
    When a development boom hits a community, local planning 
departments are often overwhelmed, citizens are caught 
unawares, and the community's character is undermined before 
residents have a chance to be heard. Adequate planning requires 
funding to hire expertise in such areas as traffic engineering, 
landscape design, architecture, and historic preservation. The 
problems that may result include loss of open space, burdened 
drinking water supplies, wasted infrastructure spending for new 
facilities while existing infrastructure is sitting idle in 
developed and abandoned areas. By providing limited Federal 
funding, State and tribal governments can improve the quality 
of communities, the environment, and the economy.

                     Objectives of the Legislation

    First, the legislation recognizes that growth is oftentimes 
inevitable, and therefore requires careful planning. Well-
planned development can significantly enhance a community's 
sense of character, while also expanding its revenue base. This 
bill is not intended to halt growth; it simply encourages 
State, tribal, and local governments to plan for growth.
    The bill is specifically written to ensure local--not 
Federal--control of land use decisions. The bill does not 
require any State or local government to do any planning if 
they decide it is unnecessary. Instead, it provides critical 
funding to States and local governments that find themselves 
under siege by unexpected development and want to update local 
planning laws, but might otherwise lack the means to do so.
    Mistakes made through haphazard development are costly and 
not easily erased. S. 975 represents an opportunity for the 
Federal Government to play a limited but helpful role, which 
every State is free to accept or reject. By providing 
$25,000,000 annually to aid States and municipalities with 
their planning needs, this small investment is intended to 
yield large dividends to communities in every corner of the 
Nation.

                      Section-by-Section Analysis

Section 1. Short Title
    This section designates the title of the bill as the 
``Community Character Act of 2001.''
Sec. 2. Findings
    Section 2 sets out the congressional findings and purposes 
of the legislation.
Sec. 3. Definitions
    Section 3 defines the following terms for purposes of this 
bill: land use plan; land use planning legislation; Secretary; 
State; and tribal government.
Sec. 4. Grants to States and Tribal Governments to Update Land Use 
        Planning Legislation

                                SUMMARY

    Section 4 authorizes the Economic Development 
Administration to establish a program to provide grants to 
States and tribal governments on a competitive basis for the 
development or revision of land use planning legislation. 
States and tribal governments are eligible for grants if their 
land use planning activities promote environmental protection, 
public works infrastructure, and sustainable economic 
development. States and tribes that receive these grants may 
use them to develop or revise land use planning legislation, 
conduct research and development relating to land use plans, or 
provide funding to local governments to carry out land use 
planning activities consistent with State planning legislation. 
This section also provides for local government pilot projects 
related to land use planning. The bill provides $25 million per 
year for fiscal years 2003 through 2007 and caps grants at $1 
million ($1.1 million if funding local pilot projects), subject 
to a 10 percent match. Five percent of the annual authorization 
is set aside for tribal governments to the extent that there 
are sufficient eligible applications.

                               DISCUSSION

    Section 4(a) directs the Secretary to create a program to 
award grants to States and tribal governments for the purpose 
of promoting comprehensive land use planning at the State, 
tribal, and local levels. States and tribes that meet the 
eligibility requirements described in Section 4(b) are eligible 
to compete for and receive grants from the Secretary under this 
section. Grant awards may not be made directly from the 
Secretary to local governments although States may grant money 
to local governments under Section 4(c)(2) and 4(d).
    Section 4(a)(2) establishes the mechanism for the 
submission and approval of grant applications. The application 
for funding under this program may take any form the Secretary 
deems appropriate. This section requires the Secretary to 
review applications for funding at least once per year, 
although nothing prohibits the Secretary from reviewing or 
approving applications more frequently. When determining which 
applications to approve, the Secretary must evaluate the 
application against the ranking criteria listed in this 
section. It is anticipated that the Secretary will solicit 
information in the application process that will allow 
applications to be measured against the ranking criteria. 
Section 4(a)(3) establishes six ranking criteria that the 
Secretary will utilize to analyze competing grant applications. 
Those ranking criteria are:

      The extent to which a State or tribal government 
has in effect inadequate or outmoded land use planning 
legislation.
      The extent to which a grant will facilitate 
development or revision of land use plans consistent with 
updated land use planning legislation.
      The extent to which development or revision of 
land use plans will facilitate multistate land use planning.
      The extent to which the area under the 
jurisdiction of a State or tribal government is experiencing 
significant growth.
      The extent to which the project to be funded 
using a grant will protect the environment and promote economic 
development.
      The extent to which a State or tribal government 
has committed financial resources to comprehensive land use 
planning. Except for giving priority to States and tribal 
governments that have applied for grant funding and that have 
inadequate or outmoded land use planning legislation in effect, 
the Secretary has ultimate discretion with regard to how much 
weight to give each ranking criteria.

    Section 4(b) delineates what States and tribal governments 
must demonstrate to be eligible for grant funding under this 
section. Since grants will be used to create future land use 
planning legislation or promote future land use activities at 
the State, tribal, and local levels, Section 4(b) is intended 
to be flexible so that a sufficient number of applicants are 
eligible for the money while ensuring that these government 
resources are not being wasted. The committee does not intend 
the eligibility requirements in Section 4(b) to be a 
prescriptive list of what must be included in the final product 
for which funding is being requested. Under Section 4(b), a 
State or tribal government will be eligible to receive grant 
funding under this section if it demonstrates that the project, 
or the goal of the project to be funded by the grant, promotes 
land use planning activities that:

      are comprehensive in nature and, to the maximum 
extent practicable promote environmental protection, take into 
consideration existing and future public works infrastructure 
(transportation, drinking water, and waste water), promote 
sustainable economic development and social equity, enhance 
community character, conserve historic, scenic, natural, and 
cultural resources, and provide for a range of affordable 
housing options;
      promote land use plans that contain an 
implementation element that includes a timetable for action and 
a definition of the respective roles and responsibilities of 
agencies, local governments, and other stakeholders, is 
consistent with the capital budget objectives of the State or 
tribal government, and provides a framework for decisions 
relating to the siting of infrastructure development, including 
development of utilities and utility distribution systems;
      result in multijurisdictional governmental 
cooperation, to the maximum extent practicable, particularly in 
the case of land use plans based on watershed boundaries;
      encourage the participation of the public in the 
development, adoption, and updating of land use plans;
      provide for the periodic updating of land use 
plans; and
      include recognized approaches to land use 
planning. Section 4(b) does not prescribe or endorse any 
particular approach to land use planning. It is expected that 
grant recipients will use awards to develop land use planning 
approaches that are suited to the individual circumstances, 
needs, geography, demographics, and desires of that grant 
recipient. In addition, at no point shall the Secretary direct 
grant recipients toward using one particular approach.

    Section 4(c) describes the types of activities or projects 
that States and tribes may carry out with grants awarded under 
this legislation. Grants awarded under this section may be used 
to obtain technical assistance or to implement 1) development 
or revisions of land use planning legislation, 2) research and 
development relating to land use plans, and other activities 
relating to the development of State, tribal, or local land use 
plans, that result in long-term policy guidelines for growth 
and development, 3) workshops, education of and consultation 
with policymakers, and participation of the public in the land 
use planning process, and 4) coordination of Federal, State, 
regional, tribal, or local land use plans. In order to 
accommodate States that would like to fund similar activities 
at the local level, this section allows grant recipients to 
provide funding to local governments to carry out land use 
planning activities consistent with State and tribal land use 
planning legislation. In addition, grant recipients may use 
funding received under this section to acquire equipment or 
information technology to facilitate State, tribal, or local 
land use planning. Investing in this type of equipment, whether 
it be geographic information systems, community visualization 
software, or other equipment, will provide communities with the 
tools to pursue planning activities long after the grant is 
awarded. The intent of the legislation to is to be as flexible 
as possible in order to achieve maximum results with limited 
resources.
    Section 4(d) allows a State to include in its application 
for a grant under this section a request for additional grant 
funds with which to establish pilot projects for local 
governments. The money obtained under the authority of this 
subsection would allow States to directly grant funding to 
local governments that wish to carry out land use planning 
activities that are consistent with land use planning 
legislation enacted at the State level. While it is not 
expected that the local government activities would mirror 
State activities, it is reasonable to expect that the local 
activities would not be inconsistent with State land use 
planning legislation, as defined under this Act.
    Section 4(e) establishes caps for grants awarded under this 
Act. A State or tribal government may not receive a grant in 
excess of $1,000,000 unless its application included a 
provision to establish a local government pilot project, in 
which case the Secretary may award up to another $100,000. 
Therefore the maximum grant award under this section, if a 
State intends to establish local government pilot projects, is 
$1,100,000. This cap is limited to the amount of a single 
grant. A State or tribe may apply each year if it has eligible 
activities to fund, but must compete against all other 
applications submitted in a given year. In order to ensure that 
the money provided under this program benefits all those which 
seek funding, the Secretary should consider previous grant 
awards to an applicant when balancing competing applications so 
that the same recipients do not receive funding year after year 
to the exclusion of others.
    Section 4(f) precludes the Federal share from exceeding 90 
percent of the cost of a project funded with a grant, except in 
a case in which the Secretary determines that a tribal 
government does not have sufficient funds to pay the non-
Federal share of the cost of the project. An investment of 10 
percent, of the cost of a project funded with a grant, by the 
State or tribal government will show commitment to the project 
and limit the costs to the Federal Government.
    The bill provides in Section 4(g) that the Inspector 
General of the Department of Commerce may periodically audit 
grants awarded under this section to ensure that the grant 
funds are used for the purposes specified in this section. 
Results of any audits shall be taken into consideration by the 
Secretary in awarding any future grants to a State or tribal 
government. Within 3 years of enactment of this bill, the 
Inspector General of the Department of Commerce shall submit to 
Congress a report describing the management of this grant 
program.
    Section 4(h) of this bill authorizes $25,000,000 for each 
of fiscal years 2003 through 2007. Of the amount appropriated 
under this subsection, the legislation requires a minimum of 5 
percent be set aside for tribal governments to the extent that 
there are a sufficient number of tribal governments that are 
eligible for funding and that submit applications. The 
committee intends that the 5 percent of appropriated minimum 
funding level for tribal governments will be calculated 
annually based upon amounts appropriated and not the amounts 
authorized in this legislation.

                          Legislative History

    On May 25, 2001, Senators Chafee, Bennett, Jeffords, Levin, 
Specter, Bingaman, Cleland, and Lieberman introduced S. 975, a 
bill to improve environmental policy by providing assistance 
for State and tribal land use planning, to promote improved 
quality of life, regionalism, and sustainable economic 
development, and for other purposes. The Committee on 
Environment and Public Works conducted a hearing on S. 975 on 
March 6, 2002. S. 975, as amended, was reported favorably by 
the Committee on Environment and Public Works on April 25, 
2002.

                                Hearings

    On March 6, 2002, the Committee on Environment and Public 
Works held a hearing on S. 975, a bill to improve environmental 
policy by providing assistance for State and tribal land use 
planning, to promote improved quality of life, regionalism, and 
sustainable economic development, and for other purposes. The 
committee received testimony from Hon. David A. Sampson, 
Assistant Secretary for Economic Development, U.S. Department 
of Commerce; Ms. Elizabeth Humstone, Executive Director, 
Vermont Forum on Sprawl and Vice Chair, city of Burlington, VT 
Planning Commission, on behalf of the American Planning 
Association; Ms. Deborah Anderson, Director, Woods Partners, 
LLC, Durham, NC, on behalf of the National Multi-Housing 
Council and the National Apartment Association; Mr. Don Chen, 
Executive Director, Smart Growth America, Washington, DC; Mr. 
F. Gary Garczynski, President, National Association of Home 
Builders; and Ms. Mary Lou Bentley, Executive Director, Western 
Nevada Development District, Carson City, NV, on behalf of the 
National Association of Development Organizations.

                             Rollcall Votes

    On April 25, 2002, the Committee on Environment and Public 
Works met to consider S. 975, the Community Character Act. A 
manager's amendment offered by Senators Jeffords and Chafee was 
agreed to by voice vote. A motion to report S. 975 as amended 
was agreed to by a vote of 12 ayes and 7 nays. Voting in favor 
were Senators Baucus, Boxer, Carper, Chafee, Clinton, Corzine, 
Graham, Jeffords, Lieberman, Reid, Specter, and Wyden. Voting 
against were Senators Bond, Crapo, Domenici, Inhofe, Smith of 
New Hampshire, Voinovich, and Warner.

                      Regulatory Impact Statement

    Section 11(b) of rule XXVI of the Standing Rules of the 
Senate requires publication of the report of the committee's 
estimate of the regulatory impact made by the bill as reported. 
No regulatory impact is expected by the passage of S. 975. The 
bill will not affect the personal privacy of others.

                          Mandates Assessment

    In compliance with the Unfunded Mandates Reform Act of 1995 
(P.L. 104-4), the committee finds that this bill would impose 
no Federal intergovernmental unfunded mandates on State, local, 
or tribal governments. The bill does not directly impose any 
private sector mandates.

                          Cost of Legislation

    Section 403 of the Congressional Budget and Impoundment 
Control Act requires that a statement of the cost of the 
reported bill, prepared by the Congressional Budget Office, be 
included in the report. That statement follows:

                                     U.S. Congress,
                               Congressional Budget Office,
                                      Washington, DC, May 15, 2002.

Hon. James M. Jeffords, Chairman,
Committee on Environment and Public Works,
U.S. Senate, Washington, DC.

    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for S. 975, the Community 
Character Act of 2002.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contacts are Deborah 
Reis (for Federal costs), who can be reached at 226-2860, and 
Leo Lex (for State and local impact), who can be reached at 
225-3220.
            Sincerely,
                                            Dan L. Crippen.
                              ----------                              

S. 975 Community Character Act of 2002, as ordered reported by the 
        Senate Committee on Environment and Public Works on April 25, 
        2002
Summary
    S. 975 would direct the Economic Development Administration 
(EDA) to make grants to states and tribes for projects related 
to land-use planning. The grants would be used for state or 
tribal research, development, and education, and to provide 
funding to local governments for land-use planning and other 
activities. For this purpose, the bill would authorize the 
appropriation of $25 million annually for fiscal years 2003 
through 2007.
    CBO estimates that implementing S. 975 would cost $70 
million through fiscal year 2007, assuming the appropriation of 
the authorized amounts. (About $55 million of the authorized 
total would be spent after 2007.) The bill would not affect 
direct spending or receipts; therefore, pay-as-you-go 
procedures would not apply.
    The bill contains no intergovernmental or private-sector 
mandates as defined in the Unfunded Mandates Reform Act (UMRA).
Estimated Cost to the Federal Government
    The estimated budgetary impact of S. 975 is shown in the 
following table. The costs of this legislation fall within 
budget function 450 (community and regional development). For 
purposes of this estimate, CBO assumes that the bill will be 
enacted before the start of fiscal year 2003, and that 
authorized amounts will be appropriated for each fiscal year. 
Estimated outlays are based on historical spending patterns for 
similar EDA programs.

    By Fiscal Year, in Millions of Dollars
---------------------------------------------------------------------------
2003     2004     2005     2006     2007
----------------------------------------------------------------------------------------------------------------
                 SPENDING SUBJECT TO APPROPRIATION
EDA Land-Use Grants:\1\
    Authorization Level............................................       25       25       25       25       25
    Estimated Outlays..............................................        2        8       15       20       25
----------------------------------------------------------------------------------------------------------------
\1\For 2002, $335 million was appropriated for the various development assistance programs administered by EDA.
  Land-use grants would be a new EDA program.


Pay-As-You-Go Considerations: None.
Intergovernmental and Private-Sector Impact
    S. 975 contains no intergovernmental or private-sector 
mandates as defined in UMRA. The bill would authorize grants to 
states and tribal governments of $25 million annually over the 
2003-2007 period for land-use planning purposes. With the 
exception of tribal governments that do not have sufficient 
funds to meet matching requirements, the bill would require 
state and tribal government recipients to provide at least 10 
percent of the funds for any project supported by the new 
grants.

Estimate Prepared By: Federal Costs: Deborah Reis; Impact on 
State, Local, and Tribal Governments: Leo Lex; Impact on the 
Private Sector: Lauren Marks.

Estimate Approved By: Peter H. Fontaine, Deputy Assistant 
Director for Budget Analysis.
  MINORITY VIEWS OF SENATORS SMITH, INHOFE, WARNER, BOND, VOINOVICH, 
                           CRAPO AND DOMENICI

    The Community Character Act, as passed by the majority, is 
opposed by a wide spectrum of citizen and business groups and 
civil rights advocates. While claiming to foster local control, 
it would do exactly the opposite, investing State and Federal 
Governments with unprecedented land use control. While claiming 
to accomplish smart growth, it instead restricts growth. While 
claiming to promote community character, it denies community 
diversity. While claiming to make innocuous State grants, it 
sets out Federal policies and priorities for land use planning 
and provides funds to implement them.
    This legislation negates the critical role of local 
jurisdictions in planning, regulating and managing land 
resources. Moreover, the constitutionality of this bill is 
highly dubious. The 10th Amendment to the United States 
Constitution reserves to the several States all powers not 
otherwise expressly delegated to the Federal Government. The 
Constitution does not grant to the Federal Government any power 
or role to play in the area of local land-use planning, 
regulation or management. We believe that the Federal 
Government should respect the expertise of local governments to 
make land-use decisions without interference from Washington.
    In addition, the President is strongly opposed to this 
bill, as it would create a new $125 million Federal program. 
The Administration's position was given at the Committee's 
March 3, 2002 hearing by David Sampson, Assistant Secretary of 
Commerce. He testified that there is no money in the budget to 
pay for this program. He further pointed out that a centralized 
approach to land use planning is not the right approach, and he 
testified that the Bush Administration advocates growth 
policies that are market-based, locally defined, and focused 
beyond the immediate economic horizon.
    This bill is opposed by groups as diverse as the National 
Association of Home Builders, the American Land Rights 
Association, National Cattlemen's Beef Association, American 
Farm Bureau Federation, National Association of Manufacturers, 
National Black Chamber of Commerce, Center for Individual 
Freedom, Defenders of Property Rights, American Road and 
Transportation Builders Association, U.S. Chamber of Commerce, 
Small Business Survival Committee, National Stone, Sand and 
Gravel Association, Outdoor Advertising Association, Outdoor 
Advertising Association of America, and the International Sign 
Association. Attached are two letters the Committee received in 
opposition to the bill, one dated April 15, 2002 from a wide 
variety of civic groups, and the other, dated April 24, 2002, 
from the National Association of Home Builders.
    On the other hand, S. 975 is strongly supported by the 
American Planning Association, who authored the ``Growing Smart 
Legislative Guidebook.'' This massive document, created with a 
$2.5 million Clinton Administration Federal grant and intended 
to provide users with ideas, principles, methods, procedures, 
definitions, and legislative approaches for planning and land 
use, contains distressing anti-property rights recommendations. 
Should S. 975 become law, the grants it provides would allow 
this Guidebook to gain nationwide prominence over decisions 
that are now made in States, cities, and towns throughout 
America. Some of the most troubling land use laws and 
regulations suggested in this Guidebook are as follows: 
restricted flexibility for variances, conditional use permits, 
and special exemption permits; authority to issue 
administrative inspection warrants (which could violate due 
process and Fourth Amendment rights against unreasonable 
searches and seizures); prosecution and imprisonment of anyone 
who knowingly fails to comply with a zoning regulation; 
financial penalties against citizens who fail to bring their 
properties into conformity with national planning standards; 
and reduced compensation to property owners for the total value 
of their losses due to increased property restrictions.
    For these reasons, we voted against reporting this bill out 
of committee, and remain opposed to its consideration by the 
Senate.
                        Changes in Existing Law

    Section 12 of rule XXVI of the Standing Rules of the Senate 
requires the committee to publish changes in existing law made 
by the bill as reported. Passage of this bill will make no 
changes to existing law.

                                   - 
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