[Senate Report 108-382]
[From the U.S. Government Publishing Office]



                                                       Calendar No. 754
108th Congress                                                   Report
                                 SENATE
 2d Session                                                     108-382

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



 
    ECONOMIC DEVELOPMENT ADMINISTRATION REAUTHORIZATION ACT OF 2004

                                _______
                                

                October 1, 2004.--Ordered to be printed

                                _______
                                

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

                              R E P O R T

                         [To accompany S. 1134]

                             together with



                            ADDITIONAL VIEWS

      [Including cost estimate of the Congressional Budget Office]

    The Committee on Environment and Public Works, to which was 
referred a bill (S. 1134) to reauthorize and improve the 
program authorized by the Public Works and Economic Development 
Act of 1965, having considered the same reports favorably 
thereon with an amendment and recommends that the bill, as 
amended, do pass.

                           General Statement

    S. 1134 provides for the reauthorization and improvement of 
the Economic Development Administration programs authorized by 
the Public Works and Economic Development Act of 1965. The bill 
strengthens the agency's ability to assist economically 
distressed communities by providing increased flexibility and a 
focus on performance.

                               Background

    The Public Works and Economic Development Act of 1965 
(PWEDA) established the Economic Development Administration 
(EDA) to assist economically distressed areas address 
conditions of substantial and persistent unemployment. Initial 
authorization of the agency and its programs expired in 1970 
and was not renewed until 1980. Authorization again expired in 
1982, and the agency survived on yearly appropriations until 
1998. At that time, EDA was reauthorized for 5 years by 
enactment of the Economic Development Administration and 
Appalachian Regional Development Act of 1998. The Act also 
reinforced already underway management and administrative 
reforms, such as efforts to target the most distressed areas 
and encourage regional cooperation.
    Since its establishment in 1965, EDA has invested more than 
$18.4 billion in more than 52,000 projects in all 50 States and 
in U.S. territories. These EDA investments have been 
supplemented by approximately $8.3 billion in matching funds 
from investment partners and have leveraged approximately $90.6 
billion in private sector investment. In total, these 
investments have created more than 2.9 million jobs and saved 
more than 830,000 jobs.
    EDA investments are made under six main assistance programs 
Public Works, Economic Adjustment, Planning, Technical 
Assistance, Research and Trade Adjustment Assistance. Five of 
these programs are authorized under PWEDA; Trade Adjustment 
Assistance is authorized under the Trade Act of 1974, as 
amended. The Federal share for any grant is not to exceed 50 
percent, except in limited circumstances of high economic 
distress or an applicant's inability to provide the matching 
share. All projects receiving grants under the Public Works or 
Economic Adjustment programs must be consistent with an EDA-
approved Comprehensive Economic Development Strategy (CEDS).
    Projects receiving EDA funds must be located in or directly 
benefit eligible areas experiencing economic distress at the 
time of application. PWEDA defines eligible areas as those 
areas that have per capita income of 80 percent or less of the 
national average; have an unemployment rate that is, for the 
most recent 24-month period for which data are available, at 
least 1 percent greater than the national average unemployment 
rate; or have experienced or are about to experience a special 
need, as determined by the Secretary.

Public Works
    The Public Works program grants support efforts to attract 
new industry, encourage business expansion, diversify local 
economies and generate or retain higher-skill, higher-wage jobs 
and investments by revitalizing, expanding and upgrading 
physical infrastructure. Examples of infrastructure and 
development facility investments supported by this program 
include water and sewer system improvements, skill-training 
facilities, industrial and business parks, industrial access 
roads, port and harbor improvements, business incubator 
facilities, multi-tenant manufacturing facilities and tourism 
facilities.

Economic Adjustment
    Grants through the Economic Adjustment program assist 
communities facing the most severe of economic crises, 
specifically the temporary or permanent change of the local or 
regional economic structural base. These changes may be the 
result of events such as military base closings, catastrophic 
natural or terrorist disasters or major plant closings. Three 
main types of activities are funded through this program: 1) 
strategy or capacity-building investments that help communities 
organize and carry out a planning process resulting in a CEDS; 
2) implementation investments, including construction of public 
works facilities, technical assistance, disaster mitigation 
assistance and local capacity building investments; and 3) 
revolving loan fund investments that capitalize an intermediary 
to make loans to local businesses that otherwise cannot access 
commercial credit.

Planning
    The planning program for Economic Development Districts, 
Indian Tribes and Redevelopment Areas provides grants to 
support the formulation and implementation of economic 
development programs designed to create or retain full-time 
permanent jobs and income for the unemployed and underemployed 
in areas of economic distress. The program is designed to build 
the local capacity for comprehensive and collaborative economic 
development activities.

Technical Assistance
    Investments funded under the Technical Assistance program 
are designed to assist communities in analyzing the feasibility 
of an economic development investment, respond to developmental 
opportunities and build and expand local organizational 
capacity in distressed areas. University Centers, which assist 
in analyzing and implementing economic development projects and 
programs and provide technology-transfer assistance, are funded 
under this program.

Research
    Through its Research program, EDA measures the performance 
of economic development investments and develops and 
disseminates to practitioners information about economic 
development issues.

Trade Adjustment Assistance
    The Trade Adjustment Assistance program funds a national 
network of 12 Trade Adjustment Assistance Centers to provide 
technical assistance to certified U.S. manufacturing firms and 
industries economically injured as the result of international 
trade competition.

                      Section-by-Section Analysis

Sec. 1. Short Title; Table of Contents
    This section provides that the Act may be cited as the 
``Economic Development Administration Reauthorization Act of 
2004'' and provides a table of contents.

                      TITLE I--GENERAL PROVISIONS

Sec. 101. Findings and declarations
    This section amends section 2 of PWEDA to reflect current 
economic conditions and to emphasize the need to increase 
innovation, productivity and entrepreneurship and attract 
private sector investment in order to create jobs and sustained 
economic growth.

Sec. 102. Definitions
    This section amends section 3 of PWEDA to clarify the 
definition of ``eligible recipient'' to include a special 
purpose unit of State or local government engaged in economic 
or infrastructure development activities; define ``Regional 
Commissions'' for the purposes of this Act and add a definition 
of ``university center'' to name the institutions ``University 
Centers for Economic Development'' and clarify that these 
centers must be institutions of higher education.

Sec. 103. Establishment of Economic Development partnerships
    This section amends section 101 of PWEDA to add non-profit 
organizations to the list of organizations with which the 
Secretary may establish economic development partnerships that 
might be appropriate to alleviate economic distress or promote 
investment in infrastructure and technological development. The 
section also eliminates the requirement that two or more States 
must be adjoining for the Secretary to enter into an agreement 
with multiple States.

Sec. 104. Coordination
    This section amends section 103 of PWEDA to authorize the 
Secretary to convene meetings with all relevant stakeholders to 
better coordinate Federal involvement in economic development 
activities.

       TITLE II--GRANTS FOR PUBLIC WORKS AND ECONOMIC DEVELOPMENT

Sec. 201. Grants for planning

Summary
    This section amends section 203 of PWEDA to clarify that 
State plans must be developed cooperatively with local 
officials and Economic Development Districts to the maximum 
extent practicable and that the Secretary must take into 
account the extent of that cooperation prior to providing 
assistance. The section also requires the State planning 
process to consider the State's workforce investment strategy 
and promotion of the use of technology in economic development.

Discussion
    Economic Development Districts provide valuable planning 
and technical assistance to help communities build local 
capacity to focus on long-term economic challenges. This 
section does not change or eliminate any of the currently 
authorized uses of funds under this section. These uses include 
technical assistance, capacity building activities and 
administrative expenses to support the on-going formulation and 
implementation of comprehensive economic development 
strategies. Small, rural areas in particular often are unable 
to maintain the professional and technical capacity necessary 
to efficiently implement a CEDS. Technical assistance provided 
by the planning organizations funded under section 203 of 
PWEDA, therefore, is often vital to ensuring timely 
implementation. Additionally, to ensure that economic 
development and economic development plans remain locally 
driven, it is important for local officials to have sufficient 
representation on the planning boards of Economic Development 
Districts. Therefore, EDA is expected to continue making 
planning grants to existing and unfunded Economic Development 
Districts in a manner consistent with currently authorized uses 
of funds under this section.

Sec. 202. Cost sharing

Summary
    This section amends section 204 of PWEDA to clarify and 
consolidate cost-share requirements under the Act.

Discussion
    This section and section 203 of the bill are primarily 
administrative in nature; no substantive changes are made to 
the Act's cost share requirements. Section 204 of PWEDA limits 
the Federal share of a project to not more than 50 percent of 
the total cost. That limitation is retained under this bill. 
Section 205, which authorizes supplementary grants, allows the 
Secretary to provide a second, supplementary grant to an EDA 
grant recipient located in a particularly distressed community, 
in accordance with regulations established by the Secretary. 
The original grant and the supplementary grant together may not 
exceed 80 percent of the total project cost. Section 202 of 
this bill simply consolidates these two authorities so that the 
Secretary may award a single grant of up to 80 percent Federal 
share for projects in certain communities. Additionally, cost 
share provisions currently located in other sections of PWEDA 
are consolidated in section 204.

Sec. 203. Supplementary grants
    This section amends section 205 of PWEDA to clarify that 
supplementary grants are grants awarded to supplement another 
Federal agency's funds.

Sec. 204. Regulations on relative needs and allocations

Summary
    This section amends section 206 of PWEDA by adding a new 
paragraph (3) to ensure that rural and urban economically 
distressed areas are not harmed by or prohibited or discouraged 
from applying for assistance under this Act by the 
establishment or implementation of a private sector leveraging 
goal and to require notification to the relevant Committees of 
Congress prior to a change in a private sector leveraging goal. 
The section also adds a new paragraph (4) to require the 
Secretary to ensure in regulations or procedures that 
assistance under Title II of PWEDA promotes job creation and 
will have a high probability of assisting recipients in meeting 
or exceeding applicable performance measures established in 
connection with the grants.

Discussion
    Private sector investment is one leading indicator of 
future increased job creation, and the Secretary should seek to 
increase private sector investments in projects funded under 
PWEDA.
    Many rural and urban economically distressed regions are 
unable to achieve high levels of private sector investment, 
however, and the Secretary should maintain the necessary 
flexibility to assist those communities that are taking the 
first steps toward economic growth.
    In establishing investment guidelines related to the amount 
of private sector investment in projects funded under this Act, 
the Secretary should take a balanced approach to ensure that 
these guidelines do not discourage investment in rural or urban 
economically distressed regions. These guidelines should not be 
used to discourage applications from such regions nor serve as 
the sole basis for denial of assistance under this Act to any 
individual project.

Sec. 205. Grants for training, research, and technical assistance
    This section amends section 207 of PWEDA to expand the list 
of activities eligible for assistance under this program to 
include studies to evaluate the effectiveness of coordinating 
EDA projects with projects funded under other acts and the 
assessment, marketing and establishment of business clusters. 
The section also clarifies that for projects that are national 
or regional in scope, the Secretary may waive the requirement 
that a non-profit organization be acting in cooperation with 
officials of a political subdivision of a State.

Sec. 206. Prevention of unfair competition

Summary
    This section repeals section 208 of PWEDA.

Discussion
    Section 208 of PWEDA requires a determination, prior to 
providing assistance, that the assistance will not increase the 
production of goods, materials or commodities, or the 
availability of services or facilities when there is not 
sufficient demand for such goods, materials, commodities, 
services or facilities to employ the efficient capacity of 
existing competitive commercial or industrial enterprises. In 
practice, this section requires EDA to perform complex and 
time-consuming analyses even though its criteria and Investment 
Policy Guidelines provide safeguards against situations section 
208 was originally intended to prevent.

Sec. 207. Grants for economic adjustment

Summary
    This section amends section 209 of PWEDA to expand the list 
of particular community assistance to include the loss of 
manufacturing jobs. The section also provides the Secretary 
with authority to promulgate regulations to improve the 
administration of revolving loan funds (RLF's), consolidate 
RLF's at the grantee's request and transfer RLF portfolio 
assets to third parties for liquidation.

Discussion
    The Economic Development Administration's revolving loan 
fund (RLF) program has proven to be an effective program that 
works through intermediaries to provide business development 
capital to new and expanding private sector industries in 
underserved urban and rural areas.
    Currently, EDA oversees more than 600 locally controlled 
RLF's. The size of this portfolio compared to the size of the 
agency has made effective oversight a challenge. This section 
provides EDA with tools to improve and streamline management of 
the RLF program. The authority to grant a request by local RLF 
operators to consolidate multiple RLF's should reduce the 
overall number of RLF's.
    New audit and reporting requirements also should help 
reduce redundant reporting requirements and open resources for 
EDA staff. When developing these new requirements, EDA should 
ensure that new audit requirements do not alter the original 
intent and scope of the RLF program by imposing new cost and 
administrative burdens on RLF grantees.
    Once implemented, these administrative and management 
improvements should allow EDA to increase its capitalization of 
new RLF's and recapitalization of existing RLF's in this 
important economic development program.

Sec. 208. Use of funds in projects constructed under projected cost

Summary
    This section amends section 211 of PWEDA to provide for the 
use of funds in projects constructed under projected cost. The 
section also directs the Comptroller General to review 
implementation of this section and report the findings to the 
Senate Committee on Environment and Public Works and the House 
Committee on Transportation and Infrastructure.

Discussion
    Currently excess grant funds from a project being 
constructed under projected cost can only be used to improve 
the project. Otherwise, these moneys must be returned to the 
Federal Treasury. Section 208 of the bill authorizes the 
Secretary to use the excess grant funds to improve the project, 
increase the Federal share of the total project cost or make 
additional investments under the Act. By allowing the Secretary 
to make additional awards rather than being required to return 
funds to the Federal Treasury, the bill ensures that all moneys 
originally designated for economic development activities are 
used for economic development. The report of the Comptroller 
General is intended to provide Congress with information on 
whether this flexibility is encouraging efficient use of 
Federal grant funds.

Sec. 209. Special impact areas

Summary
    This section adds a new section 214 to PWEDA to allow the 
Secretary to designate special impact areas and waive the 
planning requirements of section 302 of the Act.

Discussion
    This new authority is limited to situations where the 
Secretary determines that 1) the eligible recipient is unable 
to comply with the requirements of section 302; 2) the project 
will fulfill a pressing need of the area; and 3) the project 
will be useful in alleviating or preventing conditions of 
excessive unemployment or underemployment or assist in 
providing employment opportunities for the unemployed or 
underemployed residents in the area. The Secretary is required 
to submit notification and justification to the Senate 
Committee on Environment and Public Works and the House 
Committee on Transportation and Infrastructure at the time of 
designation.

Sec. 210. Performance awards

Summary
    This section adds a new section 215 of PWEDA to authorize 
the Secretary to make performance awards to grant recipients 
based on performance measures to be established by regulation. 
The section also directs the Comptroller General to review 
implementation of this section and report the findings to the 
Senate Committee on Environment and Public Works and the House 
Committee on Transportation and Infrastructure.

Discussion
    The Secretary is directed to establish by regulation the 
performance criteria to be used in determining which grant 
recipients will receive performance awards and how large the 
awards will be. When formulating these rules, the Secretary 
shall consider inclusion of measures that assess the recipients 
performance in meeting or exceeding scheduling and job creation 
goals, as well as the amount of private sector investment. The 
performance award may be no greater than 10 percent of the 
original project grant amount and may be used for any economic 
development purpose eligible under the Act. When used in 
combination with funds awarded under other provisions of PWEDA 
or under another Federal act, the performance award funds shall 
be treated as non-Federal funds.

Sec. 211. Planning Performance Awards

Summary
    This section adds a new section 216 of PWEDA to authorize 
the Secretary to make planning performance awards for projects 
located in economic development districts.

Discussion
    The opportunity to receive additional funds may encourage 
some recipients to work more closely and more efficiently with 
economic development districts. Therefore, the Secretary is 
authorized to make an award of no more than 5 percent of the 
original project grant to a recipient meeting the following 
four criteria: 1) actively participated in the economic 
development activities of the district; 2) the project is 
consistent with the district's CEDS; 3) worked with Federal, 
State and local economic development entities throughout the 
development of the project; and 4) the project was completed in 
accordance with the district's CEDS. The award funds may be 
used to increase the Federal share of a project funded under 
this title up to 100 percent.

Sec. 212. Direct expenditure or redistribution by recipient

Summary
    This section creates a new section 217 of PWEDA to allow a 
recipient of funds under sections 201, 203, 207 or 209 of the 
Act to directly expend or redistribute the grant funds.

Discussion
    Current law allows recipients of funds under section 209 to 
redistribute the grant funds to other public and private 
entities in the form of grants, loans, loan guarantees, 
payments to reduce interest on loans and other appropriate 
assistance. This section extends the authority to redistribute 
funds to recipients receiving funds under sections 201, 203, 
and 207 of PWEDA. Redistributions under this new authority are 
only allowed in the form of subgrants to other eligible 
recipients.

213. Brownfields redevelopment

Summary
    This section adds a new section 218 of PWEDA to 
specifically authorize the Secretary to make grants for 
projects at brownfield sites, as the term is defined under 
current law. The section also provides clarification on how the 
Secretary should deal with potential remediation activities.

Discussion
    EDA has provided grants for projects redeveloping 
potentially contaminated sites since its establishment in 1965. 
In 2002, the Small Business Liability Relief and Brownfields 
Revitalization Act established a program to be administered by 
the Environmental Protection Agency to encourage the clean-up 
of lightly contaminated sites or brownfield sites. This section 
complements the EPA brownfields assessment and clean-up program 
by focusing on the next step - actual redevelopment.
    Subsection (a) of the new section 218 defines the term 
``brownfield site'' by referencing section 101(39) of the 
Comprehensive Environmental Response, Compensation, and 
Liability Act of 1980 (CERCLA). Subsection (b) authorizes the 
Secretary to provide grants for projects located at such sites.
    Subsection (c)(1) defines the terms ``hazardous substance'' 
and ``release'' by referencing section 101 of CERCLA. It also 
clarifies that the term ``remediation'' does not include 
asbestos abatement, indoor lead-based paint abatement or other 
activities described under CERCLA 104(a)(3)(B) in response to a 
release or a threat of release from products that are part of a 
structure of, and result in exposure within, residential 
buildings, businesses or community structures.
    Subsection (c)(2) establishes a general prohibition on the 
use of EDA grant funds for remediation. EDA grants for projects 
at brownfield sites should be for redevelopment, not clean-up, 
activities. Occasionally, contamination is not apparent until a 
project is underway or is very minor in the context of the 
overall project. Therefore, funds may be used for remediation 
that is incidental to the economic development project, such as 
removal of intact underground storage tanks. Such incidental 
remediation shall not exceed $50,000. The Secretary is 
authorized to waive that limitation, up to $200,000, in 
exceptional circumstances that further the mission of EDA. The 
annual report required under section 603 of the Act shall 
include a list of these waivers. When incidental remediation is 
necessary, the recipient must obtain written approval or 
clearance from EPA or the appropriate State response program 
and comply with all applicable Federal and State laws.
    Subsection (d) provides limitations on the use of grant 
funds by referencing section 104(k)(4)(B) of CERCLA. Exceptions 
are provided for administrative and compliance costs of 
economic development activities since these are acceptable uses 
of funds for projects not at brownfield sites. This subsection 
also clarifies, for the purposes of this Act, the definition of 
``bona fide prospective purchaser'' under CERCLA.
    Subsection (e) clarifies that nothing in this section 
affects the Secretary's current authority to award economic 
redevelopment grants for projects onsites excluded from the 
definition of a ``brownfield site.'' In other words, the 
requirements of this section apply to all sites defined as 
``brownfields'' under this section but do not extend to non-
brownfield sites.
    This section does not authorize new funds or require a 
particular amount of current funds to be awarded for projects 
at brownfield sites. EDA's mission is to create jobs. 
Therefore, projects at brownfield sites should compete for 
funds in the same manner as projects at other sites. EDA, 
however, should continue to give appropriate consideration to 
the benefits of brownfields redevelopment when selecting which 
projects to fund.

        TITLE III--COMPREHENSIVE ECONOMIC DEVELOPMENT STRATEGIES

Sec. 301. Eligibility of areas
    This section amends section 301 of PWEDA to clarify 
possible Federal data sources that may be used to determine the 
eligibility of areas.

Sec. 302. Comprehensive Economic Development strategies
    This sections amends section 302 of PWEDA to clarify that 
the CEDS should maximize effective development and use of the 
workforce, consistent with any applicable State or local 
workforce investment strategy, and promote the use of 
technology in economic development. The section also requires 
that any other plan approved by the Secretary to function as a 
CEDS should be consistent and coordinated with any existing 
plan for the area.

                TITLE IV--ECONOMIC DEVELOPMENT DISTRICTS

Sec. 401. Incentives
    This section repeals section 403 of PWEDA. Section 403 of 
PWEDA authorized the Secretary to increase grant amounts, by up 
to 10 percent of the project cost, for projects in economic 
development districts. This incentive served to encourage the 
establishment of districts, but districts now serve most of the 
Nation.

Sec. 402. Provisions of comprehensive Economic Development strategies 
        to Regional Commissions
    This section amends section 404 of PWEDA to clarify that an 
economic development district located within the area of a 
Regional Commission should provide a copy of its CEDS to the 
Commission.

                        TITLE V--ADMINISTRATION

Sec. 501. Economic Development information clearinghouse
    This section amends section 502 of PWEDA to clarify that 
the clearinghouse should be maintained on the Internet. The 
section also deletes references to links to local laws and 
information, as this is beyond what is realistically achievable 
by EDA.

Sec. 502. Businesses desiring Federal contracts
    This section repeals section 505 of PWEDA, which authorized 
the Secretary to provide Federal procurement officials with the 
names of businesses in economically distressed areas.

Sec. 503. Performance evaluations of grant recipients
    This section amends section 506 of PWEDA to make technical 
corrections and to clarify the criteria to be used to evaluate 
university centers.

Sec. 504. Conforming amendments
    This section amends section 602 of PWEDA to provide the 
correct U.S. Code citation.

                        TITLE VI--MISCELLANEOUS

Sec. 601. Annual report to Congress
    This section amends section 603 of PWEDA to specify that 
the annual report sent to Congress should include a list of 
waivers issued under the new section 218(c)(3)(C) and 
information related to the private sector investment ratio of 
grants awarded.

Sec. 602. Relationship to assistance under other law
    This section strikes section 609(a) of PWEDA which relates 
to assistance previously authorized under the Act.

Sec. 603. Sense of Congress regarding Economic Development 
        Representatives
    This section declares it to be the sense of Congress that 
the Secretary should maintain a sufficient number of economic 
development representatives to ensure that EDA is able to 
provide effective assistance to distressed communities and 
foster economic growth and development among the States.

                           TITLE VII--FUNDING

Sec. 701. Authorization of appropriations
    This section amends section 701 of PWEDA to authorize the 
following amounts for economic development assistance programs 
to carry out the Act: $400,000,000 in fiscal year 2004; 
$425,000,000 in fiscal year 2005; $450,000,000 in fiscal year 
2006; $475,000,000 in fiscal year 2007; and $500,000,000 in 
fiscal year 2008. The section also authorizes $33,377,000 in 
fiscal year 2004 and such sums as are necessary thereafter for 
salaries and expenses.

Sec. 702. Funding for grants for planning and grants for administrative 
        expenses

Summary
    This section adds a new section 704 of PWEDA to establish a 
minimum funding level of $27,000,000 for the planning program. 
This requirement shall not apply in any year in which total 
appropriations for programs under this Act (not including 
defense adjustment and disaster recovery assistance) is less 
than $255,000,000.

Discussion
    Appropriations for the planning program have remained level 
at approximately $24,000,000 for a decade. This section ensures 
that funding will increase following enactment of the bill. 
This increase should allow EDA to provide funding to designated 
but unfunded districts and new districts and increase funding 
to currently funded districts. The increase is not required if 
EDA's overall funding decreases below $255 million.

                                Appendix

    The committee recommends that $1,250,000 be made available 
for the 18th Street High Tech Park New Village at Technology 
Centre in Kansas City, Missouri.
    The committee recommends that $1,250,000 be made available 
for the Southwest Area Career Center in Monnett, Missouri.
    The committee recommends that $800,000 be made available to 
the Nevada Commission for the Reconstruction of the V & T 
Railway for the restoration of the Virginia City and Truckee 
Railroad.
    The committee recommends that $1,000,000 be made available 
to the White Pine County Economic Diversification Council 
(WPCEDC) for the Northern Nevada Railway and Regional 
Recreation Center. The committee further urges EDA to consider, 
based on documentation provided by WPCEDC, whether WPCEDC has 
exhausted its effective borrowing capacity under section 
204(c)(2) of this Act and, therefore, is eligible for grants at 
100 percent Federal cost.
    The committee recommends that $200,000 be made available to 
Nevada's Center for Entrepreneurship and Technology.
    The committee recommends that $2,250,000 be made available 
to the Elgin Economic Development Authority for development of 
the Elgin Industrial Park in Elgin, Oklahoma.
    The committee recommends that $500,000 be made available to 
the city of Miami for economic development activities in Miami, 
Oklahoma.
    The committee recommends that $750,000 be made available to 
Rural Enterprises of Oklahoma, Inc. for expansion of Foreign 
Trade Zone #227 in Durant, Oklahoma.
    The committee recommends that $1,000,000 be made available 
from Economic Adjustment or Local Technical Assistance funding 
to the Vermont Council on Rural Development to assist the 
Vermont wood products industry. The committee further urges EDA 
to consider, based on documentation provided by VCRD, whether 
VCRD has exhausted its effective borrowing capacity under 
section 204 (c)(2) of this Act and, therefore, is eligible for 
grants at 100 percent Federal cost. The committee also 
recommends that, for the purposes of assisting the Vermont wood 
products industry beginning prior to implementation of the new 
authority under section 214 of PWEDA, EDA proceed as if the 
State of Vermont had been designated a ``Special Impact Area.'' 
Participation in this project should not influence any 
regulations or guidance necessary to implement section 214.
    The committee recommends that $1,500,000 be available for 
the ``Rails to the River'' redevelopment in Windsor, Vermont.
    The committee recommends that $3 million be made available 
for assistance in the construction and operation of a cold 
storage freezer by the Ketchikan Gateway Borough in Ketchikan, 
Alaska.
    The committee recommends that $365,000 be made available 
for a project in the City of Conneaut, Ohio, to develop and 
market the Eastside Industrial Park, including infrastructure 
improvements.
    The committee recommends that $735,000 be made available 
for support of JumpStart, a cooperative effort in Northeast 
Ohio that works with entrepreneurs to develop high-growth 
businesses.
    The committee recommends that $300,000 be made available 
for continued development of an economic development project 
located in Trumbull and Mahoning Counties in the State of Ohio.
    The committee recommends that $300,000 be made available 
for development of the Ashtabula City Industrial Park in 
Astabula County, Ohio, including infrastructure development.
    The committee recommends that $400,000 be made available 
for development/upgrade of the Orwell Industrial Park in 
Ashtabula County, Ohio, including infrastructure and access 
improvements.
    The committee recommends that $400,000 be made available 
for the purchase and redevelopment of a wastewater treatment 
facility, potable well field, and adjacent property in Kinsman 
Township, Trumbull County, Ohio.
    The committee recommends that $1.5 million be made 
available for construction of a sanitary sewer line to connect 
Wyoming, Minnesota to a regional wastewater treatment facility.
    The committee recommends that $1.25 million be made 
available to the Natural Resources Research Institute of the 
University of Minnesota-Duluth to conduct a taconite tailings 
research and demonstration project.
    The committee recommends that $500,000 be made available to 
the government of the District of Columbia to finance 
construction of a retail complex in the predominately low-and 
moderate-income neighborhood of Columbia Heights, Washington, 
DC.
    The committee recommends that $500,000 be made available to 
the government of the District of Columbia for site preparation 
for commercial redevelopment at The New East Capitol 
Marketplace, Washington, DC.
    The committee recommends that $1 million be made available 
to the government of the District of Columbia for land 
acquisition and site preparation costs for development for a 
retail center in the Hillcrest neighborhood, Washington, DC.
    The committee recommends that $250,000 be made available to 
the government of the District of Columbia for development and 
restoration of an arts center in the low-income neighborhood 
along H Street, Washington, DC. NE.

                          Legislative History

    On May 22, 2003, Senators Bond and Inhofe introduced by 
request S. 1134, a bill to reauthorize and improve the programs 
authorized by the Public Works and Economic Development Act of 
1965. The bill was read twice and referred to the Committee on 
Environment and Public Works. The committee met on June 23, 
2004, to consider the bill. The bill, as amended, was ordered 
reported on June 23, 2004.
    On October 21, 2003, H.R. 2535 was received in the Senate 
and read twice and referred to the Committee on Environment and 
Public Works.

                                Hearings

    On April 28, 2004, the Committee on Environment and Public 
Works held a hearing to receive testimony on the 
reauthorization of the Economic Development Administration. The 
committee received testimony from Hon. David A. Sampson, 
Assistant Secretary of Commerce for Economic Development, 
Economic Development Administration; Mr. Gary Gorshing, 
President, National Association of Development Organizations; 
Mr. Jim Saudade, Deputy Commissioner Housing and Community 
Affairs, Vermont Agency of Commerce and Community Development; 
Mr. R. Charles Gatson, Vice President and COO, Swope Community 
Builders; and Dr. Phillip A. Singerman, Executive Director, 
Maryland Technology Development Corporation, on behalf of the 
International Economic Development Council.

                             Rollcall Votes

    The Committee on Environment and Public Works met to 
consider S. 1134 on June 23, 2004. The committee agreed by 
unanimous consent that the Chairman's mark, providing a 
complete substitute, be considered as original text for 
purposes of amendment. A managers amendment making technical 
and other corrections was offered by Senators Inhofe, Jeffords 
and Bond. A second degree amendment regarding the Secretary's 
brownfields waiver was also offered by Senators Inhofe, 
Jeffords and Bond. The second degree and managers amendments 
were accepted by voice vote. Two amendments regarding the 
development of business clusters and the use of technology were 
offered by Senator Clinton. Both amendments were accepted by 
unanimous consent. The bill, as amended, was ordered reported 
by voice vote.

                      Regulatory Impact Statement

    In compliance with section 11(b) of rule XXVI of the 
Standing Rules of the Senate, the committee makes evaluation of 
the regulatory impact of the reported bill.
    Section 207 of the bill directs the Secretary to promulgate 
regulations to maintain the proper operation and financial 
integrity of revolving loan funds established by recipients 
with assistance under this section.
    Section 210 of the bill directs the Secretary to promulgate 
regulations to establish the performance measures to be used in 
making performance awards established under the section. The 
bill also directs the Secretary to consider the inclusion of 
several specific measures.

                          Mandates Assessment

    In compliance with the Unfunded Mandates Reform Act of 1995 
(Public Law 104-4), the committee finds that S. 1134 would 
impose no Federal intergovernmental mandates on State, local or 
tribal governments. The bill does not 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:
                              ----------                              


               CONGRESSIONAL BUDGET OFFICE COST ESTIMATE

S. 1134, Economic Development Administration Reauthorization Act of 
        2004, as ordered reported by the Senate Committee on 
        Environment and Public Works on June 23, 2004.

Summary
    S. 1134 would reauthorize the Economic Development 
Administration (EDA) for an additional 5 years and authorize 
funding for existing grant programs and new programs 
established under the bill. CBO estimates that implementing 
this legislation would cost about $1.3 billion over the 2005-
2009 period and an additional $700 billion after 2009, assuming 
appropriation of the necessary amounts. Enacting S. 1134 would 
not affect direct spending or revenues.
    Over the 2005-2009 period, about $1.12 billion would be 
used by EDA to provide various types of grants that support 
activities associated with economic development and assistance 
for distressed communities, including a new incentive grant 
program that would reward grant recipients who have met certain 
performance measures. About $140 million over the next 5 years 
would be used for EDA salaries and expenses.
    S. 1134 contains no intergovernmental or private-sector 
mandates as defined in the Unfunded Mandates Reform Act (UMRA). 
The grants and incentive awards authorized in the bill would 
provide financial benefits to State, local, and tribal 
governments that participate in the economic development and 
planning programs; any costs to those governments would be 
incurred voluntarily.

Estimated Cost to the Federal Government
    CBO estimates that implementing the bill would cost about 
$1.3 billion over the 2005-2009 period, assuming appropriation 
of the necessary amounts each year. Those estimated outlays are 
based on historical patterns for ongoing and similar 
activities. The estimated budgetary impact of S. 1134 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
----------------------------------------------------------------------------------------------------------------
                                                                   2004    2005    2006    2007    2008    2009
----------------------------------------------------------------------------------------------------------------
                SPENDING SUBJECT TO APPROPRIATION
EDA Spending Under Current Law..................................
    Budget Authority\1\.........................................     310       0       0       0       0       0
    Estimated Outlays...........................................     381     344     253     171      75       8
Proposed Changes:...............................................
    Economic Development Assistance Programs....................
        Authorization Level.....................................       0     425     450     475     500       0
        Estimated Outlays.......................................       0      21     116     216     348     426
    EDA Salaries and Expenses...................................
        Estimated Authorization Level\2\........................       0      34      35      36      37       0
        Authorization Outlays...................................       0      31      35      36      37       3
    Total Proposed Changes......................................
        Estimated Authorization Level...........................       0     459     485     511     537       0
        Estimated Outlays.......................................       0      52     151     252     385     429
EDA Spending Under S. 1134......................................
    Estimated Authorization Level\1\............................     310     459     485     511     537       0
    Estimated Outlays...........................................     381     396     404     423     460     437
----------------------------------------------------------------------------------------------------------------
\1\The 2004 level is the amount appropriated for EDA assistance programs and EDA's salaries and expenses.
\2\The bill specifies an authorization level for 2004 administrative costs, amounts over the 2005-2008 period
  were estimated by adjusting this level for anticipated inflation.

Intergovernmental and Private-Sector Impact
    S. 1134 contains no intergovernmental or private-sector 
mandates as defined in UMRA. State, local, and tribal 
governments would benefit from additional grant programs for 
economic development, performance and planning awards, and the 
changes to the requirements for State and local matches of 
Federal grants. Such changes would provide additional resources 
for economic development projects; any costs to those 
governments would be incurred voluntarily.

Previous CBO Estimate
    On July 15, 2003, CBO transmitted a cost estimate for H.R. 
2535, the Economic Development Administration Reauthorization 
Act of 2003, as ordered reported by the House Committee on 
Transportation and Infrastructure on June 25, 2003. H.R. 2532 
would authorize the Secretary of Commerce to establish a 
demonstration program for the redevelopment of brownfield sites 
using solar energy technologies. CBO estimated that program 
would cost $5 million per year over the 5-year period, subject 
to the appropriation of the authorized amounts. S. 1134 would 
not authorize the demonstration program.
    Estimate Prepared By: Federal Costs: Lanette J. Walker; 
Impact on State, Local, and Tribal Governments: Melissa 
Merrell; Impact on the Private Sector: Amina Masood.
    Estimate Approved By: Peter H. Fontaine, Deputy Assistant 
Director for Budget Analysis.

                   Additional Views of Senator Boxer

    I fully support the Economic Development Administration 
Reauthorization Act of 2004, S. 1134, and its continued 
authorization, with the exception of section 213, which 
undermines brownfields cleanups standards and regulations. 
Section 213 is both unnecessary and unacceptable and should be 
opposed on both procedural and substantive grounds.
    Any EDA brownfields grant program must be fully consistent 
with EPA brownfields standards. We cannot allow EDA to have 
weaker standards and less oversight than we fought for under 
EPA's brownfields program.
    Currently, all brownfields cleanups are regulated by United 
States Environmental Protection Agency (EPA) standards. 
Allowing EDA to use its grant funds to address truly incidental 
cleanup issues that are discovered after the cleanup of a 
brownfields site is completed, such as pulling an in tact 
underground storage tank, is a laudable goal. However, in 
crafting such a provision it is critical that we ensure that: 
the cleanups are truly incidental; EDA is not doing Superfund-
caliber clean-ups; EPA, the agency with expertise in hazardous 
substance remediation, oversees the cleanup; public 
participation is guaranteed; and, EDA is held to the same 
standards as a cleanup funded by the EPA.
    Unfortunately, section 213 creates a brownfields program 
within the Economic Development Administration (EDA) that: 
contains virtually no limit on acceptable projects; is 
significantly weaker than, and inconsistent with, EPA's 
brownfields program and standards; contains virtually no checks 
and balances; undermines the polluter pays principle; provides 
no guarantees of public participation; and will open the door 
to other agencies requesting similarly weak brownfields 
programs and the undermining of the brownfields program.
    I will address each of these concerns separately.
    First, section 213(b) of the legislation expands the 
current list of eligibility factors for brownfields grants to 
allow brownfields grants for six new types of projects, 
including ``any other assistance.'' This language is so broad 
as to allow a grant for virtually any type of project.
    Second, section 213 is significantly weaker than, and 
inconsistent with, EPA's brownfields program and standards.
    The EDA brownfields program is in no way connected to the 
requirements of the National Contingency Plan (NCP) of the 
Comprehensive Environmental Response, Compensation and 
Liability Act (42 U.S.C. 9604 et seq.) (CERCLA), as is EPA's 
program. The NCP establishes criteria, methods, and procedures 
used by EPA to respond to releases and threats of release of 
hazardous substances, pollutants, or contaminants. The goal of 
the NCP is to select cleanup remedies that protect human health 
and the environment. The EDA bill includes no such criteria, 
methods, procedures, or goals.
    Further, the savings clause in section 213(c)(3)(D)(ii) of 
this bill is inadequate, providing protection for Federal and 
State laws only. In contrast, the EPA's brownfields program 
requires compliance with all ``appropriate, relevant, and 
applicable regulations'' (ARARs), which include guidelines, 
policies, and goals. For instance, using a drinking water 
standard as the basis for a groundwater cleanup is standard 
practice. However, drinking water regulations are not 
considered ``applicable'' Federal or State law for groundwater 
cleanups. Such a standard would be relevant, but not binding, 
unless EDA grant recipients are required to comply with all 
ARARs. Under S. 1134, there would be nothing to ensure, or 
require, that a project comply with drinking water standards. 
The effect of this omission in the EDA bill is to weaken 
current EPA cleanup standards.
    In addition, while it is clear that the language in this 
bill allows EDA funds to be used for remediation, it also 
includes a new definition of ``remediation'' that blurs the 
parameters of EDA's program and responsibilities for cleaning 
up hazardous waste sites. Section 213(c)(2) prohibits 
remediation to prevent or minimize releases of hazardous 
substances only. This is a different standard from Superfund 
authority to address a release or substantial threat of release 
of hazardous substances, pollutants, or contaminants. Thus, 
under section 213, the cleanup of truly incidental unreleased 
contamination, such as lead hazard paint around a window, is 
likely prohibited under this language.
    Section 213(c)(3)(D)(i) would require that any recipient of 
EDA brownfields grants ``obtain written approval from the 
appropriate Federal and State regulatory authority for the 
hazardous waste remediation.'' The use of the term ``hazardous 
waste remediation'' (emphasis added) is inconsistent with the 
CERCLA and EPA brownfields terminology, which regulates 
``hazardous substances, pollutants and contaminants,'' 
(emphasis added), and with other portions of this section, 
which refer to ``hazardous substances,'' (emphasis added). 
Hazardous waste is regulated in the Solid Waste Disposal Act, 
which defines it as ``a solid waste, or combination of solid 
wastes,'' (Solid Waste Disposal Act, 42 U.S.C. 6903(5)). Thus, 
the reach of this section is unclear. However, it is clearly 
inconsistent with, and weaker than, current brownfields cleanup 
standards.
    Even if the definition of ``hazardous waste'' were 
correctly referred to as ``hazardous substances, pollutants and 
contaminants'' in this subsection, it will only require 
``approval and clearance'' for hazardous substances as defined 
by CERCLA, which excludes oil, natural gas, and fuels. Thus, it 
is unclear whether the requirements of Section 213 apply to 
these sites.
    Likewise, it is unclear if these hazardous waste sites are 
subject to the section 213(c) cleanup spending limits, as they 
appear to apply only to the remediation of hazardous 
substances.
    Third, section 213 contains virtually no checks and 
balances due to inadequate oversight.
    Section 213(c)(3)(D)(i)'s approval and clearance provision 
is so vague and confusing as to provide virtually no oversight. 
It is unclear which agency is required to give ``approval and 
clearance'' under this Act. Arguably, but not necessarily, the 
``appropriate Federal and State hazardous waste authority for 
the hazardous waste remedial action'' when implementing an EDA 
remedial action is the State or Federal EPA. It is equally 
likely that the appropriate agencies would be determined to be 
State and Federal EDA, as EPA is nowhere mentioned in 
legislation that deals solely with EDA and it programs. 
Additionally, the use of the word ``appropriate'' seems to 
contemplate more than one Federal entity, further opening the 
possibility that the ``appropriate'' agency is not necessarily 
EPA, but could be EDA. Thus, its reach is unclear at best, 
limited at worst.
    Further, ``clearance'' as used in this section is vague and 
undefined. It is not a term used in the lexicon of CERCLA or 
other environmental laws and this section gives no guidance as 
to what it means. In addition, the term ``Federal and State'' 
contradicts the singular ``authority.'' It is unclear if 
clearance is required from both the Federal and State agency or 
from one only. It is also unclear how grantees would determine 
to whom to apply for such clearance as no such guidance is 
offered.
    The use of the term ``hazardous waste'' in this section 
also undermines appropriate oversight and weakens EDA 
brownfields cleanup standards, requiring approval and clearance 
only for hazardous waste cleanups, not CERCLA cleanups.
    If the intention is to get sign off by EPA and the 
appropriate State environmental protection agency, this 
subsection needs to be clarified to reflect the stated intent 
of the parties and to guarantee the appropriate oversight by 
the agencies with cleanup expertise.
    Further, section (c)(3) allows EDA to fund cleanups at 
EPA's maximum funding level of $200,000. Section (c)(3)(C)(i) 
allows EDA to grant up to $200,000 ``in exceptional 
circumstances that further the mission of the Economic 
Development Agency.'' The mission of EDA is ``[t]o lead the 
Federal economic development agenda by promoting innovation and 
competitiveness, preparing American regions for growth and 
success in the worldwide economy.'' As this is so broad and the 
bill provides no guidance, it appears that virtually anything 
would qualify as an exceptional circumstance. Thus, EDA will 
have the authority to fund and oversee EPA-equivalent cleanups.
    This is especially troubling because EDA, an agency with no 
expertise in remediation, will now be performing brownfields 
remediation at Superfund-caliber sites. In fact, brownfields 
sites can be any hazardous waste sites not on the National 
Priorities List (NPL). Further, many sites eligible for NPL 
listing have not been listed merely because of decreased 
funding abilities, not because they are not hazardous. All of 
these sites are eligible as brownfields. Thus, a brownfields 
site can be as hazardous as a Superfund site.
    Fourth, the polluter pays principles we fought so hard to 
include in Superfund and the Brownfields law are completely 
undermined in section 213.
    Section 213(d)(2)(B) allows the use of EDA funds for 
``compliance costs.'' Compliance costs may include any cleanup 
and enforcement costs and administrative and other penalties. 
For instance, compliance costs would include the fines for 
failing to comply with a permit for filling in wetlands or 
mitigating environmental damage as well as the costs of 
complying with the regulation.
    Further, as mentioned above, as CERCLA's National 
Contingency Plan does not apply, EPA's CERCLA cost recovery 
provisions and mechanisms do not apply. Without these 
provisions, it is unclear what EDA will do to recoup its costs 
from polluters or whether this bill is deigned to waive 
polluter pays principles and liability altogether.
    Section 213(d)(2)(C)'s bona fide prospective purchaser 
language appears to release an eligible grant recipient from 
Superfund liability. Notably, the Brownfields Redevelopment and 
Environmental Restoration Act does not release responsible 
parties from liability.
    Fifth, S. 1134 has no provision for notice or public 
participation in EDA brownfields cleanups. In contrast, EPA is 
required to include public participation in its brownfields 
grants (42 U.S.C. 9628(A)(2). The public right to know and 
participate in brownfields cleanups is a critical part of 
ensuring adequate oversight and the protection of public health 
and the environment.
    Sixth, EDA is the first, but not the last, agency that will 
be asking for these types of lenient standards. Housing and 
Urban Development has already approached Congress attempting to 
secure weaker standards for cleanups than are in place for EPA 
cleanups. This will likely result in some parties engaging in 
brownfields cleanup agency forum shopping as they look for 
weaker oversight and standards. For instance, according to EDA 
figures, its brownfields-related funding for fiscal year 2004 
was $259 million as compared to EPA's budget of $171 million. 
In fiscal year 2005, EDA's budget is projected to be $269 
million, whereas EPA's is projected at $210 million. Thus, EDA 
could potentially oversee more brownfields cleanups that EPA.
    The weakening of brownfields cleanup standards is all the 
more perplexing as it is completely unnecessary for EDA 
reauthorization. It is a rollback attached to this bill without 
full and adequate discussion and hearings. This committee spent 
10 years working out the parameters of brownfields cleanup and 
regulation. Here, we begin to dismantle it less than 3 years 
later. And, it is completely unnecessary.
    This language was not in the original version of S. 1134, 
but was inserted into a manager's package at the last moment 
before the committee vote. The one hearing on S. 1134 had 
almost no discussion of brownfields. None of the witnesses 
mentioned it in his remarks and only one Senator briefly 
mentioned brownfields in his testimony. However, in the 
comments that were elicited during the questioning of 
witnesses, the one consistent theme that rang through was that 
EDA should do economic development, not environmental 
remediation.
    This weak and poorly drafted brownfields provision should 
be removed, thus, reauthorizing EDA while safeguarding 
environmental and public health during brownfields cleanups. I 
urge my colleagues to remove section 213 from S. 1134.

                        Changes in Existing Law

    In compliance with section 12 of rule XXVI of the Standing 
Rules of the Senate, 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:
                              ----------                              


           PUBLIC WORKS AND ECONOMIC DEVELOPMENT ACT OF 1965


[As Amended Through P.L. 108-204, March 2, 2004]

           *       *       *       *       *       *       *



SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``Public 
Works and Economic Development Act of 1965''.
    (b) Table of Contents.--The table of contents of this Act 
is as follows:

Sec. 1. Short title; table of contents.
Sec. 2. Findings and declarations.
Sec. 3. Definitions.

 TITLE I--ECONOMIC DEVELOPMENT PARTNERSHIPS COOPERATION AND COORDINATION

Sec. 101. Establishment of economic development partnerships.
Sec. 102. Cooperation of Federal agencies.
Sec. 103. Coordination.

       TITLE II--GRANTS FOR PUBLIC WORKS AND ECONOMIC DEVELOPMENT

Sec. 201. Grants for public works and economic development.
Sec. 202. Base closings and realignments.
Sec. 203. Grants for planning and grants for administrative expenses.
Sec. 204. Cost sharing.
Sec. 205. Supplementary grants.
Sec. 206. Regulations on relative needs and allocations.
Sec. 207. Grants for training, research, and technical assistance.
[Sec. 208. Prevention of unfair competition.] Repealed
Sec. 209. Grants for economic adjustment.
Sec. 210. Changed project circumstances.
Sec. 211. Use of funds in projects constructed under projected cost.
Sec. 212. Reports by recipients.
Sec. 213. Prohibition on use of funds for attorney's and consultant's 
          fees.
Sec. 214. Special impact areas.
Sec. 215. Performance awards.
Sec. 216. Planning performance awards.
Sec. 217. Direct expenditure or redistribution by recipient.
Sec. 218. Brownfields redevelopment.

  TITLE III--ELIGIBILITY; COMPREHENSIVE ECONOMIC DEVELOPMENT STRATEGIES

Sec. 301. Eligibility of areas.
Sec. 302. Comprehensive economic development strategies.

                TITLE IV--ECONOMIC DEVELOPMENT DISTRICTS

Sec. 401. Designation of economic development districts.
Sec. 402. Termination or modification of economic development districts.
[Sec. 403. Incentives.] Repealed
[Sec. 404. Provision of comprehensive economic development strategies to 
          Appalachian Regional Commission.]
Sec. 404. Provision of comprehensive economic development strategies to 
          Regional Commissions.
Sec. 405. Assistance to parts of economic development districts not in 
          eligible areas.

                         TITLE V--ADMINISTRATION

Sec. 501. Assistant Secretary for Economic Development.
Sec. 502. Economic development information clearinghouse.
Sec. 503. Consultation with other persons and agencies.
Sec. 504. Administration, operation, and maintenance.
[Sec. 505. Businesses desiring Federal contracts.] Repealed
Sec. 506. Performance evaluations of grant recipients.
Sec. 507. Notification of reorganization.

                         TITLE VI--MISCELLANEOUS

Sec. 601. Powers of Secretary.
Sec. 602. Maintenance of standards.
Sec. 603. Annual report to Congress.
Sec. 604. Delegation of functions and transfer of funds among Federal 
          agencies.
Sec. 605. Penalties.
Sec. 606. Employment of expediters and administrative employees.
Sec. 607. Maintenance and public inspection of list of approved 
          applications for financial assistance.
Sec. 608. Records and audits.
Sec. 609. Relationship to assistance under other law.
Sec. 610. Acceptance of certifications by applicants.

                           TITLE VII--FUNDING

Sec. 701. General authorization of appropriations.
Sec. 702. Authorization of appropriations for defense conversion 
          activities.
Sec. 703. Authorization of appropriations for disaster economic recovery 
          activities.
Sec. 704. Funding for grants for planning and grants for administrative 
          expenses.
      

           *       *       *       *       *       *       *


[SEC. 2. FINDINGS AND DECLARATIONS.

    [(a) Findings.--Congress finds that--
            [(1) while the economy of the United States is 
        undergoing a sustained period of economic growth 
        resulting in low unemployment and increasing incomes, 
        there continue to be areas suffering economic distress 
        in the form of high unemployment, low incomes, 
        underemployment, and outmigration as well as areas 
        facing sudden economic dislocations due to industrial 
        restructuring and relocation, defense base closures and 
        procurement cutbacks, certain Federal actions 
        (including environmental requirements that result in 
        the removal of economic activities from a locality), 
        and natural disasters;
            [(2) as the economy of the United States continues 
        to grow, those distressed areas contain significant 
        human and infrastructure resources that are underused;
            [(3) expanding international trade and the 
        increasing pace of technological innovation offer both 
        a challenge and an opportunity to the distressed 
        communities of the United States;
            [(4) while economic development is an inherently 
        local process, the Federal Government should work in 
        partnership with public and private local, regional, 
        and State organizations to ensure that existing 
        resources are not wasted and all Americans have an 
        opportunity to participate in the economic growth of 
        the United States;
            [(5) in order to avoid wasteful duplication of 
        effort and to limit the burden on distressed 
        communities, Federal, State, and local economic 
        development activities should be better planned and 
        coordinated and Federal program requirements should be 
        simplified and made more consistent;
            [(6) the goal of Federal economic development 
        activities should be to work in partnership with local, 
        regional, and State public and private organizations to 
        support the development of private sector businesses 
        and jobs in distressed communities;
            [(7) Federal economic development efforts will be 
        more effective if they are coordinated with, and build 
        upon, the trade and technology programs of the United 
        States; and
            [(8) under this Act, new employment opportunities 
        should be created by developing and expanding new and 
        existing public works and other facilities and 
        resources rather than by merely transferring jobs from 
        one area of the United States to another.
    [(b) Declarations.--Congress declares that, in order to 
promote a strong and growing economy throughout the United 
States--
            [(1) assistance under this Act should be made 
        available to both rural and urban distressed 
        communities;
            [(2) local communities should work in partnership 
        with neighboring communities, the States, and the 
        Federal Government to increase their capacity to 
        develop and implement comprehensive economic 
        development strategies to address existing, or deter 
        impending, economic distress; and
            [(3) whether suffering from long-term distress or a 
        sudden dislocation, distressed communities should be 
        encouraged to take advantage of the development 
        opportunities afforded by technological innovation and 
        expanding and newly opened global markets.]

SEC. 2. FINDINGS AND DECLARATIONS.

    (a) Findings.--Congress finds that--
            (1) there continue to be areas of the United States 
        experiencing chronic high unemployment, 
        underemployment, outmigration, and low per capita 
        incomes, as well as areas facing sudden and severe 
        economic dislocations because of structural economic 
        changes, changing trade patterns, certain Federal 
        actions (including environmental requirements that 
        result in the removal of economic activities from a 
        locality), and natural disasters;
            (2) economic growth in the States, cities, and 
        rural areas of the United States is produced by 
        expanding economic opportunities, expanding free 
        enterprise through trade, developing and strengthening 
        public infrastructure, and creating a climate for job 
        creation and business development;
            (3) the goal of Federal economic development 
        programs is to raise the standard of living for all 
        citizens and increase the wealth and overall rate of 
        growth of the economy by encouraging communities to 
        develop a more competitive and diversified economic 
        base by--
                    (A) creating an environment that promotes 
                economic activity by improving and expanding 
                public infrastructure;
                    (B) promoting job creation through 
                increased innovation, productivity, and 
                entrepreneurship; and
                    (C) empowering local and regional 
                communities experiencing chronic high 
                unemployment and low per capita income to 
                develop private sector business and attract 
                increased private sector capital investment;
            (4) while economic development is an inherently 
        local process, the Federal Government should work in 
        partnership with public and private State, regional, 
        tribal, and local organizations to maximize the impact 
        of existing resources and enable regions, communities, 
        and citizens to participate more fully in the American 
        dream and national prosperity;
            (5) in order to avoid duplication of effort and 
        achieve meaningful, long-lasting results, Federal, 
        State, tribal, and local economic development 
        activities should have a clear focus, improved 
        coordination, a comprehensive approach, and simplified 
        and consistent requirements; and
            (6) Federal economic development efforts will be 
        more effective if the efforts are coordinated with, and 
        build upon, the trade, workforce investment, 
        transportation, and technology programs of the United 
        States.
    (b) Declarations.--In order to promote a strong and growing 
economy throughout the United States, Congress declares that--
            (1) assistance under this Act should be made 
        available to both rural- and urban-distressed 
        communities;
            (2) local communities should work in partnership 
        with neighboring communities, the States, Indian 
        tribes, and the Federal Government to increase the 
        capacity of the local communities to develop and 
        implement comprehensive economic development strategies 
        to alleviate economic distress and enhance 
        competitiveness in the global economy; and
            (3) whether suffering from long-term distress or a 
        sudden dislocation, distressed communities should be 
        encouraged to support entrepreneurship to take 
        advantage of the development opportunities afforded by 
        technological innovation and expanding newly opened 
        global markets.

           *       *       *       *       *       *       *


SEC. 3. DEFINITIONS.

    In this Act:
            (1) * * *

           *       *       *       *       *       *       *

            (4) Eligible recipient.--
                    (A) In general.--The term ``eligible 
                recipient'' means--
                            [(i) an area described in section 
                        301(a);]
                            [(ii)](i) an economic development 
                        district;
                            [(iii)](ii) an Indian tribe;
                            [(iv)](iii) a State, including a 
                        special purpose unit of a State or 
                        local government engaged in economic or 
                        infrastructure development activities,
                            [(v)](iv) a city or other political 
                        subdivision of a State, including a 
                        special purpose unit of a State or 
                        local government engaged in economic or 
                        infrastructure development activities, 
                        or a consortium of political 
                        subdivisions;
                            [(vi)](v) an institution of higher 
                        education or a consortium of 
                        institutions of higher education; or
                            [(vii)](vi) a public or private 
                        nonprofit organization or association 
                        acting in cooperation with officials of 
                        a political subdivision of a State.

           *       *       *       *       *       *       *

            (8) Regional commissions.--The term `Regional 
        Commissions' means--
                    (A) the Appalachian Regional Commission 
                established under chapter 143 of title 40, 
                United States Code;
                    (B) the Delta Regional Authority 
                established under subtitle F of the 
                Consolidated Farm and Rural Development Act (7 
                U.S.C. 2009aa et seq.);
                    (C) the Denali Commission established under 
                the Denali Commission Act of 1998 (42 U.S.C. 
                3121 note; 112 Stat. 2681-637 et seq.); and
                    (D) the Northern Great Plains Regional 
                Authority established under subtitle G of the 
                Consolidated Farm and Rural Development Act (7 
                U.S.C. 2009bb et seq.).
            [(8)](9) Secretary.--The term ``Secretary'' means 
        the Secretary of Commerce.
            [(9)](10) State.--The term ``State'' means a State, 
        the District of Columbia, the Commonwealth of Puerto 
        Rico, the Virgin Islands, Guam, American Samoa, the 
        Commonwealth of the Northern Mariana Islands, the 
        Republic of the Marshall Islands, the Federated States 
        of Micronesia, and the Republic of Palau.
            [(10)](11) United states.--The term ``United 
        States'' means all of the States.
            (12) University center.--The term `university 
        center' means an institution of higher education or a 
        consortium of institutions of higher education 
        established as a University Center for Economic 
        Development under section 207(a)(2)(D).

           *       *       *       *       *       *       *


SEC. 101. ESTABLISHMENT OF ECONOMIC DEVELOPMENT PARTNERSHIPS.

    (a) In general.-- * * *

           *       *       *       *       *       *       *

    (b) Technical Assistance.--The Secretary may provide such 
technical assistance to States, political subdivisions of 
States, sub-State regional organizations (including 
organizations that cross State boundaries), [and multi-State 
regional organizations] multi-State regional organizations, and 
nonprofit organizations as the Secretary determines is 
appropriate to--
            (1) alleviate economic distress;
            (2) encourage and support public-private 
        partnerships for the formation and improvement of 
        economic development strategies that sustain and 
        promote economic development across the United States; 
        and
            (3) promote investment in infrastructure and 
        technological capacity to keep pace with the changing 
        global economy.

           *       *       *       *       *       *       *

    (d) Cooperation Agreements.--
            (1) In general.--The Secretary may enter into a 
        cooperation agreement with any 2 or more [adjoining] 
        States, or an organization of any 2 or more [adjoining] 
        States, in support of effective economic development.

           *       *       *       *       *       *       *


SEC. 103. COORDINATION.

    (a) In General._The Secretary shall coordinate activities 
relating to the preparation and implementation of comprehensive 
economic development strategies under this Act with Federal 
agencies carrying out other Federal programs, States, economic 
development districts, Indian tribes, and other appropriate 
planning and development organizations.
    (b) Meetings.--To carry out subsection (a), or for any 
other purpose relating to economic development activities, the 
Secretary may convene meetings with Federal agencies, State and 
local governments, economic development districts, Indian 
tribes, and other appropriate planning and development 
organizations.

           *       *       *       *       *       *       *


SEC. 203. GRANTS FOR PLANNING AND GRANTS FOR ADMINISTRATIVE EXPENSES.

    (a) In General.-- * * *

           *       *       *       *       *       *       *

    (d) State Plans.--
            (1) Development.--Any State plan developed with 
        assistance under this section shall be developed, to 
        the maximum extent practicable, cooperatively by the 
        State, political subdivisions of the State, and the 
        economic development districts located wholly or 
        partially in the State.
            (2) Comprehensive economic development strategy.--
        As a condition of receipt of assistance for a State 
        plan under this subsection, the State shall have or 
        develop a comprehensive economic development strategy.
            [(3) Certification to the secretary.--On completion 
        of a State plan developed with assistance under this 
        section, the State shall--
                    [(A) certify to the Secretary that, in the 
                development of the State plan, local and 
                economic development district plans were 
                considered and, to the maximum extent 
                practicable, the State plan is consistent with 
                the local and economic development district 
                plans; and
                    [(B) identify any inconsistencies between 
                the State plan and the local and economic 
                development district plans and provide a 
                justification for each inconsistency.]
            (3) Coordination.--Before providing assistance for 
        a State plan under this section, the Secretary shall 
        consider the extent to which the State will consider 
        local and economic development district plans.
            (4) Comprehensive planning process.--Any overall 
        State economic development planning assisted under this 
        section shall be a part of a comprehensive planning 
        process that shall consider the provision of public 
        works to--
                    (A) promote economic development and 
                opportunity;
                    (B) foster effective transportation access;
                    (C) enhance and protect the environment; 
                [and]
                    (D) assist in carrying out the workforce 
                investment strategy of a State;
                    (E) promote the use of technology in 
                economic development, including access to high-
                speed telecommunications; and
                    [(D)] (F) balance resources through the 
                sound management of physical development.
            (5) Report to secretary.--Each State that receives 
        assistance for the development of a plan under this 
        subsection shall submit to the Secretary an annual 
        report on the planning process assisted under this 
        subsection.

           *       *       *       *       *       *       *


SEC. 204. COST SHARING.

    [(a) Federal Share.--Subject to section 205, the amount of 
a grant for a project under this title shall not exceed 50 
percent of the cost of the project.]
    (a) Federal Share.--Except as provided in subsection (c), 
the Federal share of the cost of any project carried out under 
this title shall not exceed--
            (1) 50 percent; plus
            (2) an additional percent that--
                    (A) shall not exceed 30 percent; and
                    (B) is based on the relative needs of the 
                area in which the project will be located, as 
                determined in accordance with regulations 
                promulgated by the Secretary.
    (b) Non-Federal Share.--In determining the amount of the 
non-Federal share of the cost of a project, the Secretary may 
provide credit toward the non-Federal share for all 
contributions both in cash and in-kind, fairly evaluated, 
including contributions of space, equipment, assumptions of 
debt, and services.
    (c) Increase in Federal Share.--
            (1) Indian tribes.--In the case of a grant to an 
        Indian tribe for a project under this title, the 
        Secretary may increase the Federal share above the 
        percentage specified in subsection (a) up to 100 
        percent of the cost of the project.
            (2) Certain states, political subdivisions, and 
        nonprofit organizations.--In the case of a grant to a 
        State, or a political subdivision of a State, that the 
        Secretary determines has exhausted the effective taxing 
        and borrowing capacity of the State or political 
        subdivision, or in the case of a grant to a nonprofit 
        organization that the Secretary determines has 
        exhausted the effective borrowing capacity of the 
        nonprofit organization, the Secretary may increase the 
        Federal share above the percentage specified in 
        subsection (a) up to 100 percent of the cost of the 
        project.
            (3) Training, research, and technical assistance.--
        In the case of a grant provided under section 207, the 
        Secretary may increase the Federal share above the 
        percentage specified in subsection (a) up to 100 
        percent of the cost of the project if the Secretary 
        determines that the project funded by the grant merits, 
        and is not feasible without, such an increase.

           *       *       *       *       *       *       *


SEC. 205. SUPPLEMENTARY GRANTS.

    (a) Definition of Designated Federal Grant Program.--In 
this section, the term ``designated Federal grant program'' 
means any Federal grant program that--
            (1) provides assistance in the construction or 
        equipping of public works, public service, or 
        development facilities;
            (2) the Secretary designates as eligible for an 
        allocation of funds under this section; and
            (3) assists projects that are--
                    (A) eligible for assistance under this 
                title; and
                    (B) consistent with a comprehensive 
                economic development strategy.
    [(b) Supplementary Grants.--
            [(1) In general.--On the application of an eligible 
        recipient, the Secretary may make a supplementary grant 
        for a project for which the eligible recipient is 
        eligible but, because of the eligible recipient's 
        economic situation, for which the eligible recipient 
        cannot provide the required non-Federal share.
            [(2) Purposes of grants.--Supplementary grants 
        under paragraph (1) may be made for purposes that shall 
        include enabling eligible recipients to use--
                    [(A) designated Federal grant programs; and
                    [(B) direct grants authorized under this 
                title.]
    (b) Supplementary Grants.--Subject to subsection (c), in 
order to assist eligible recipients in taking advantage of 
designated Federal grant programs, on the application of an 
eligible recipient, the Secretary may make a supplementary 
grant for a project for which the recipient is eligible but for 
which the recipient cannot provide the required non-Federal 
share because of the economic situation of the recipient.
    (c) Requirements Applicable to Supplementary Grants.--
            [(1) Amount of supplementary grants.--Subject to 
        paragraph (4), the amount of a supplementary grant 
        under this title for a project shall not exceed the 
        applicable percentage of the cost of the project 
        established by regulations promulgated by the 
        Secretary, except that the non-Federal share of the 
        cost of a project (including assumptions of debt) shall 
        not be less than 20 percent.
            [(2) Form of supplementary grants.--In accordance 
        with such regulations as the Secretary may promulgate, 
        the Secretary shall make supplementary grants by 
        increasing the amounts of grants authorized under this 
        title or by the payment of funds made available under 
        this Act to the heads of the Federal agencies 
        responsible for carrying out the applicable Federal 
        programs.]
            (1) Amount of supplementary grants.--The share of 
        the project cost supported by a supplementary grant 
        under this section may not exceed the applicable 
        Federal share under section 204.
            (2) Form of supplementary grants.--The Secretary 
        shall make supplementary grants by--
                    (A) the payment of funds made available 
                under this Act to the heads of the Federal 
                agencies responsible for carrying out the 
                applicable Federal programs; or
                    (B) the provision of funds under this Act, 
                which will be combined with funds transferred 
                from other Federal agencies in projects 
                administered by the Secretary.
            (3) Federal share limitations specified in other 
        laws.--Notwithstanding any requirement as to the amount 
        or source of non-Federal funds that may be applicable 
        to a Federal program, funds provided under this section 
        may be used to increase the Federal share for specific 
        projects under the program that are carried out in 
        areas described in section 301(a) above the Federal 
        share of the cost of the project authorized by the law 
        governing the program.
            [(4) Lower non-federal share.--
                    [(A) Indian tribes.--In the case of a grant 
                to an Indian tribe, the Secretary may reduce 
                the non-Federal share below the percentage 
                specified in paragraph (1) or may waive the 
                non-Federal share.
                    [(B) Certain states, political 
                subdivisions, and nonprofit organizations.--In 
                the case of a grant to a State, or a political 
                subdivision of a State, that the Secretary 
                determines has exhausted its effective taxing 
                and borrowing capacity, or in the case of a 
                grant to a nonprofit organization that the 
                Secretary determines has exhausted its 
                effective borrowing capacity, the Secretary may 
                reduce the non-Federal share below the 
                percentage specified in paragraph (1).]

           *       *       *       *       *       *       *


SEC. 206. REGULATIONS ON RELATIVE NEEDS AND ALLOCATIONS.

    In promulgating rules, regulations, and procedures for 
assistance under this title, the Secretary shall ensure that--
            (1) the relative needs of eligible areas are given 
        adequate consideration by the Secretary, as determined 
        based on, among other relevant factors--
                    (A) the severity of the rates of 
                unemployment in the eligible areas and the 
                duration of the unemployment;
                    (B) the income levels and the extent of 
                underemployment in eligible areas; and
                    (C) the outmigration of population from 
                eligible areas and the extent to which the 
                outmigration is causing economic injury in the 
                eligible areas; [and]
            (2) allocations of assistance under this title are 
        prioritized to ensure that the level of economic 
        distress of an area, rather than a preference for a 
        geographic area or a specific type of economic 
        distress, is the primary factor in allocating the 
        assistance[.] ;
            (3)(A) rural and urban economically distressed 
        areas are not harmed by the establishment or 
        implementation by the Secretary of a private sector 
        leveraging goal for a project under this title;
            (B) any private sector leveraging goal established 
        by the Secretary does not prohibit or discourage grant 
        applicants under this title from public works in, or 
        economic development of, rural or urban economically 
        distressed areas; and
            (C) the relevant Committees of Congress are 
        notified prior to making any changes to any private 
        sector leveraging goal; and
            (4) grants made under this title promote job 
        creation and will have a high probability of assisting 
        the recipient in meeting or exceeding applicable 
        performance requirements established in connection with 
        the grants.

           *       *       *       *       *       *       *


SEC. 207. GRANTS FOR TRAINING, RESEARCH, AND TECHNICAL ASSISTANCE.

    (a) In General.--
            (1) Grants.--On the application of an eligible 
        recipient, the Secretary may make grants for training, 
        research, and technical assistance, including grants 
        for program evaluation and economic impact analyses, 
        that would be useful in alleviating or preventing 
        conditions of excessive unemployment or 
        underemployment.
            (2) Types of assistance.--Grants under paragraph 
        (1) may be used for--
                    (A) project planning and feasibility 
                studies;
                    (B) demonstrations of innovative activities 
                or strategic economic development investments;
                    (C) management and operational assistance;
                    (D) establishment of university centers;
                    (E) establishment of business outreach 
                centers;
                    (F) studies evaluating the needs of, and 
                development potential for, economic growth of 
                areas that the Secretary determines have 
                substantial need for the assistance; [and]
                    (G) studies that evaluate the effectiveness 
                of coordinating projects funded under this Act 
                with projects funded under other Acts;
                    (H) assessment, marketing, and 
                establishment of business clusters; and
                    [(G)] (I) other activities determined by 
                the Secretary to be appropriate.
            [(3) Reduction or waiver of non-federal share.--In 
        the case of a project assisted under this section, the 
        Secretary may reduce or waive the non-Federal share, 
        without regard to section 204 or 205, if the Secretary 
        finds that the project is not feasible without, and 
        merits, such a reduction or waiver.]
            (3) Cooperation requirement.--In the case of a 
        project assisted under this section that is national or 
        regional in scope, the Secretary may waive the 
        provision in section 3(4)(A)(vi) requiring a nonprofit 
        organization or association to act in cooperation with 
        officials of a political subdivision of a State.

           *       *       *       *       *       *       *


[SEC. 208. PREVENTION OF UNFAIR COMPETITION.

    [No financial assistance under this Act shall be extended 
to any project when the result would be to increase the 
production of goods, materials, or commodities, or the 
availability of services or facilities, when there is not 
sufficient demand for such goods, materials, commodities, 
services, or facilities, to employ the efficient capacity of 
existing competitive commercial or industrial enterprises.]

           *       *       *       *       *       *       *


SEC. 209. GRANTS FOR ECONOMIC ADJUSTMENT.

    (a) In General.-- * * *

           *       *       *       *       *       *       *

    (c) Particular Community Assistance.--Assistance under this 
section may include assistance provided for activities 
identified by communities, the economies of which are injured 
by--
            (1) military base closures or realignments, defense 
        contractor reductions in force, or Department of Energy 
        defense-related funding reductions, for help in 
        diversifying their economies through projects to be 
        carried out on Federal Government installations or 
        elsewhere in the communities;
            (2) disasters or emergencies, in areas with respect 
        to which a major disaster or emergency has been 
        declared under the Robert T. Stafford Disaster Relief 
        and Emergency Assistance Act (42 U.S.C. 5121 et seq.), 
        for post-disaster economic recovery;
            (3) international trade, for help in economic 
        restructuring of the communities; [or]
            (4) fishery failures, in areas with respect to 
        which a determination that there is a commercial 
        fishery failure has been made under section 312(a) of 
        the Magnuson-Stevens Fishery Conservation and 
        Management Act (16 U.S.C. 1861a(a))[.] ; or
            (5) the loss of manufacturing jobs, for reinvesting 
        in and diversifying the economies of the communities.
    [(d) Direct Expenditure or Redistribution by Recipient.--
            [(1) In general.--Subject to paragraph (2), an 
        eligible recipient of a grant under this section may 
        directly expend the grant funds or may redistribute the 
        funds to public and private entities in the form of a 
        grant, loan, loan guarantee, payment to reduce interest 
        on a loan guarantee, or other appropriate assistance.
            [(2) Limitation.--Under paragraph (1), an eligible 
        recipient may not provide any grant to a private for-
        profit entity.]
    (d) Special Provisions Relating to Revolving Loan Fund 
Grants.--
            (1) In general.--The Secretary shall promulgate 
        regulations to maintain the proper operation and 
        financial integrity of revolving loan funds established 
        by recipients with assistance under this section.
            (2) Efficient administration.--The Secretary may--
                    (A) at the request of a grantee, amend and 
                consolidate grant agreements governing 
                revolving loan funds to provide flexibility 
                with respect to lending areas and borrower 
                criteria;
                    (B) assign or transfer assets of a 
                revolving loan fund to third party for the 
                purpose of liquidation, and the third party may 
                retain assets of the fund to defray costs 
                related to liquidation; and
                    (C) take such actions as are appropriate to 
                enable revolving loan fund operators to sell or 
                securitize loans (except that the actions may 
                not include issuance of a Federal guaranty by 
                the Secretary).
            (3) Treatment of actions.--An action taken by the 
        Secretary under this subsection with respect to a 
        revolving loan fund shall not constitute a new 
        obligation if all grant funds associated with the 
        original grant award have been disbursed to the 
        recipient.
            (4) Preservation of securities laws.--
                    (A) Not treated as exempted securities.--No 
                securities issued pursuant to paragraph (2)(C) 
                shall be treated as exempted securities for 
                purposes of the Securities Act of 1933 (15 
                U.S.C. 77a et seq.) or the Securities Exchange 
                Act of 1934 (15 U.S.C. 78a et seq.), unless 
                exempted by rule or regulation of the 
                Securities and Exchange Commission.
                    (B) Preservation.--Except as provided in 
                subparagraph (A), no provision of this 
                subsection or any regulation promulgated by the 
                Secretary under this subsection supersedes or 
                otherwise affects the application of the 
                securities laws (as the term is defined in 
                section 3(a) of the Securities Exchange Act of 
                1934 (15 U.S.C. 78c(a))) or the rules, 
                regulations, or orders of the Securities and 
                Exchange Commission or a self-regulatory 
                organization under that Commission.

           *       *       *       *       *       *       *


[SEC. 211. USE OF FUNDS IN PROJECTS CONSTRUCTED UNDER PROJECTED COST.

    [In any case in which a grant (including a supplementary 
grant described in section 205) has been made by the Secretary 
under this title (or made under this Act, as in effect on the 
day before the effective date of the Economic Development 
Administration Reform Act of 1998) for a construction project, 
and, after the grant has been made but before completion of the 
project, the cost of the project based on the designs and 
specifications that was the basis of the grant has decreased 
because of decreases in costs--
            [(1) the Secretary may approve, subject to the 
        availability of appropriations, the use of the excess 
        funds or a portion of the funds to improve the project; 
        and
            [(2) any amount of excess funds remaining after 
        application of paragraph (1) shall be deposited in the 
        general fund of the Treasury.]

SEC. 211. USE OF FUNDS IN PROJECTS CONSTRUCTED UNDER PROJECTED COST.

    (a) In General.--In the case of a grant to a recipient for 
a construction project under section 201 or 209, if the 
Secretary determines, before closeout of the project, that the 
cost of the project, based on the designs and specifications 
that were the basis of the grant, has decreased because of 
decreases in costs, the Secretary may approve, without further 
appropriation, the use of the excess funds (or a portion of the 
excess funds) by the recipient--
            (1) to increase the Federal share of the cost of a 
        project under this title to the maximum percentage 
        allowable under section 204; or
            (2) to improve the project.
    (b) Other Uses of Excess Funds.--Any amount of excess funds 
remaining after application of subsection (a) may be used by 
the Secretary for providing assistance under this Act.
    (c) Transferred Funds.--In the case of excess funds 
described in subsection (a) in projects using funds transferred 
from other Federal agencies pursuant to section 604, the 
Secretary shall--
            (1) use the funds in accordance with subsection 
        (a), with the approval of the originating agency; or
            (2) return the funds to the originating agency.
    (d) Review by Comptroller General.--
            (1) Review.--The Comptroller General of the United 
        States shall review the implementation of this section 
        for each fiscal year.
            (2) Annual report.--Not later than 1 year after the 
        date of enactment of this section, and annually 
        thereafter, the Comptroller General shall submit to the 
        Committee on Environment and Public Works of the Senate 
        and the Committee on Transportation and Infrastructure 
        of the House of Representatives a report on the 
        findings of the Comptroller General under this 
        subsection.

           *       *       *       *       *       *       *


SEC. 214. SPECIAL IMPACT AREAS.

    (a) In General.--On the application of an eligible 
recipient that is determined by the Secretary to be unable to 
comply with the requirements of section 302, the Secretary may 
waive, in whole or in part, the requirements of section 302 and 
designate the area represented by the recipient as a special 
impact area.
    (b) Conditions.--The Secretary may make a designation under 
subsection (a) only after determining that--
            (1) the project will fulfill a pressing need of the 
        area; and
            (2) the project will--
                    (A) be useful in alleviating or preventing 
                conditions of excessive unemployment or 
                underemployment; or
                    (B) assist in providing useful employment 
                opportunities for the unemployed or 
                underemployed residents in the area.
    (c) Notification.--At the time of the designation under 
subsection (a), the Secretary shall submit to the Committee on 
Environment and Public Works of the Senate and the Committee on 
Transportation and Infrastructure of the House of 
Representatives a written notice of the designation, including 
a justification for the designation.

           *       *       *       *       *       *       *


SEC. 215. PERFORMANCE AWARDS.

    (a) In General.--The Secretary may make a performance award 
in connection with a grant made, on or after the date of 
enactment of this section, to an eligible recipient for a 
project under section 201 or 209.
    (b) Performance Measures.--
            (1) Regulations.--The Secretary shall promulgate 
        regulations to establish performance measures for 
        making performance awards under subsection (a).
            (2) Considerations.--In promulgating regulations 
        under paragraph (1), the Secretary shall consider the 
        inclusion of performance measures that assess--
                    (A) whether the recipient meets or exceeds 
                scheduling goals;
                    (B) whether the recipient meets or exceeds 
                job creation goals;
                    (C) amounts of private sector capital 
                investments leveraged; and
                    (D) such other factors as the Secretary 
                determines to be appropriate.
    (c) Amount of Awards.--
            (1) In general.--The Secretary shall base the 
        amount of a performance award made under subsection (a) 
        in connection with a grant on the extent to which a 
        recipient meets or exceeds performance measures 
        established in connection with the grant.
            (2) Maximum amount.--The amount of a performance 
        award may not exceed 10 percent of the amount of the 
        grant.
    (d) Use of Awards.--A recipient of a performance award 
under subsection (a) may use the award for any eligible purpose 
under this Act, in accordance with section 602 and such 
regulations as the Secretary may promulgate.
    (e) Federal Share.--Notwithstanding section 204, the funds 
of a performance award may be used to pay up to 100 percent of 
the cost of an eligible project or activity.
    (f) Treatment in Meeting Non-Federal Share Requirements.--
For the purposes of meeting the non-Federal share requirements 
under this, or any other, Act the funds of a performance award 
shall be treated as funds from a non-Federal source.
    (g) Terms and Conditions.--In making performance awards 
under subsection (a), the Secretary shall establish such terms 
and conditions as the Secretary considers to be appropriate.
    (h) Funding.--The Secretary shall use any amounts made 
available for economic development assistance programs to carry 
out this section.
    (i) Reporting Requirement.--The Secretary shall include 
information regarding performance awards made under this 
section in the annual report required under section 603.
    (j) Review by Comptroller General.--
            (1) Review.--The Comptroller General shall review 
        the implementation of this section for each fiscal 
        year.
            (2) Annual report.--Not later than 1 year after the 
        date of enactment of this section, and annually 
        thereafter, the Comptroller General shall submit to the 
        Committee on Environment and Public Works of the Senate 
        and the Committee on Transportation and Infrastructure 
        of the House of Representatives a report on the 
        findings of the Comptroller under this subsection.

           *       *       *       *       *       *       *


SEC. 216. PLANNING PERFORMANCE AWARDS.

    (a) In General.--The Secretary may make a planning 
performance award in connection with a grant made, on or after 
the date of enactment of this section, to an eligible recipient 
for a project under this title located in an economic 
development district.
    (b) Eligibility.--The Secretary may make a planning 
performance award to an eligible recipient under subsection (a) 
in connection with a grant for a project if the Secretary 
determines before closeout of the project that--
            (1) the recipient actively participated in the 
        economic development activities of the economic 
        development district in which the project is located;
            (2) the project is consistent with the 
        comprehensive economic development strategy of the 
        district;
            (3) the recipient worked with Federal, State, and 
        local economic development entities throughout the 
        development of the project; and
            (4) the project was completed in accordance with 
        the comprehensive economic development strategy of the 
        district.
    (c) Maximum Amount.--The amount of a planning performance 
award made under subsection (a) in connection with a grant may 
not exceed 5 percent of the amount of the grant.
    (d) Use of Awards.--A recipient of a planning performance 
award under subsection (a) shall use the award to increase the 
Federal share of the cost of a project under this title.
    (e) Federal Share.--Notwithstanding section 204, the funds 
of a planning performance award may be used to pay up to 100 
percent of the cost of a project under this title.
    (f) Funding.--The Secretary shall use any amounts made 
available for economic development assistance programs to carry 
out this section.

           *       *       *       *       *       *       *


SEC. 217. DIRECT EXPENDITURE OR REDISTRIBUTION BY RECIPIENT.

    (a) In General.--Subject to subsection (b), a recipient of 
a grant under section 201, 203, or 207 may directly expend the 
grant funds or may redistribute the funds in the form of a 
subgrant to other eligible recipients to fund required 
components of the scope of work approved for the project.
    (b) Limitation.--A recipient may not redistribute grant 
funds received under section 201 or 203 to a for-profit entity.
    (c) Economic Adjustment.--Subject to subsection (d), a 
recipient of a grant under section 209 may directly expend the 
grant funds or may redistribute the funds to public and private 
entities in the form of a grant, loan, loan guarantee, payment 
to reduce interest on a loan guarantee, or other appropriate 
assistance.
    (d) Limitation.--Under subsection (c), a recipient may not 
provide any grant to a private for-profit entity.

           *       *       *       *       *       *       *


SEC. 218. BROWNFIELDS REDEVELOPMENT.

    (a) Definition of Brownfield Site.--In this section, the 
term `brownfield site' has the meaning given the term in 
section 101(39) of the Comprehensive Environmental Response, 
Compensation, and Liability Act of 1980 (42 U.S.C. 9601(39)).
    (b) Grants.--On the application of eligible recipients, the 
Secretary may make grants for projects on brownfield sites to 
alleviate or prevent conditions of inadequate private capital 
investment, unemployment, underemployment, blight, 
underutilized or abandoned land, outmigration or population 
loss, or infrastructure deterioration, including projects 
consisting of--
            (1) acquisition, development, or reuse of land and 
        infrastructure improvements for a public works, 
        service, or facility;
            (2) development of public facilities, including 
        design and engineering, construction, rehabilitation, 
        alteration, expansion, or improvement, and related 
        machinery and equipment;
            (3) business development (including funding of a 
        revolving loan fund);
            (4) planning;
            (5) technical assistance; and
            (6) any other assistance determined by the 
        Secretary to alleviate the economic impacts of 
        brownfield sites consistent with the objectives of this 
        title.
    (c) Prohibition on Remediation.--
            (1) Definitions.--In this subsection:
                    (A) Hazardous substance.--The term 
                `hazardous substance' has the meaning given the 
                term in section 101(14) of the Comprehensive 
                Environmental Response, Compensation, and 
                Liability Act of 1980 (42 U.S.C. 9601(14)).
                    (B) Release.--The term `release' has the 
                meaning given the term in section 101(22) of 
                the Comprehensive Environmental Response, 
                Compensation, and Liability Act of 1980 (42 
                U.S.C. 9601(22)).
                    (C) Remediation.--The term `remediation' 
                does not include response activities described 
                in section 104(a)(3) of the Comprehensive 
                Environmental Response, Compensation, and 
                Liability Act of 1980 (42 U.S.C. 9604(a)(3)).
            (2) Prohibition.--Except as provided in paragraph 
        (3), a grant made under this section shall not be used 
        for remediation to prevent or minimize the release of 
        hazardous substances.
            (3) Exception for incidental remediation.--
                    (A) In general.--Paragraph (2) does not 
                apply to remediation that is incidental to the 
                economic redevelopment project.
                    (B) Limitation.--Except as provided in 
                subparagraph (C), incidental remediation shall 
                not exceed $50,000 at any individual project.
                    (C) Exceptional circumstances.--
                            (i) In general.--Subject to clause 
                        (ii), the Secretary may waive 
                        subparagraph (B) in exceptional 
                        circumstances that further the mission 
                        of the Economic Development 
                        Administration.
                            (ii) Limitation.--If the Secretary 
                        waives subparagraph (B) for a project, 
                        the cost of the incidental remediation 
                        at the project shall not exceed 
                        $200,000.
                    (D) Standards.--A recipient of a grant 
                under this section that is used for incidental 
                remediation shall--
                            (i) obtain written approval or 
                        clearance from the appropriate Federal 
                        and State regulatory authority for the 
                        hazardous waste remediation; and
                            (ii) comply with all applicable 
                        Federal and State laws.
            (4) Effect on federal and state laws.--Nothing in 
        this section affects any liability, obligation, or 
        response authority under Federal or State law.
    (d) Additional Limitations.--
            (1) In general.--Except as provided in paragraph 
        (2), a grant made under this section shall be subject 
        to section 104(k)(4)(B) of the Comprehensive 
        Environmental Response, Compensation, and Liability Act 
        of 1980 (42 U.S.C. 9604(k)(4)(B)).
            (2) Exceptions.--
                    (A) Administrative costs.--A recipient of a 
                grant made under this section may use grant 
                funds for the administrative costs of economic 
                development activities.
                    (B) Compliance costs.--A recipient of a 
                grant made under this section may use grant 
                funds for the compliance costs of economic 
                development activities.
                    (C) Bona fide prospective purchaser.--For 
                purposes of the Comprehensive Environmental 
                Response, Compensation, and Liability Act of 
                1980 (42 U.S.C. 9601 et seq.), a recipient of a 
                grant under this section that otherwise 
                satisfies the definition of `bona fide 
                prospective purchaser' under section 101(40) of 
                the Comprehensive Environmental Response, 
                Compensation, and Liability Act of 1980 (42 
                U.S.C. 9601(40)) shall be considered to be 
                within that definition regardless of the date 
                on which the grant recipient acquires ownership 
                of a facility.
    (e) Assistance at Other Sites.--Nothing in this section 
affects the authority of the Secretary to provide assistance to 
eligible recipients under this Act for economic development 
projects at a site other than a brownfield site.

           *       *       *       *       *       *       *


SEC. 301. ELIGIBILITY OF AREAS.

    (a) In General.-- * * *

           *       *       *       *       *       *       *

    (c) Documentation.--
            (1) In general.--A determination of eligibility 
        under subsection (a) shall be supported by the most 
        recent Federal data available (including data available 
        from the Bureau of Economic Analysis, the Bureau of 
        Labor Statistics, the Census Bureau, the Bureau of 
        Indian Affairs, or any other Federal source determined 
        by the Secretary to be appropriate), or, if no recent 
        Federal data is available, by the most recent data 
        available through the government of the State in which 
        the area is located.

           *       *       *       *       *       *       *


SEC. 302. COMPREHENSIVE ECONOMIC DEVELOPMENT STRATEGIES.

    (a) In General.-- * * *

           *       *       *       *       *       *       *

            (3)(A) a comprehensive economic development 
        strategy for addressing the economic problems 
        identified under paragraph (1) in a manner that 
        promotes economic development and opportunity, fosters 
        effective transportation access, maximizes effective 
        development and use of the workforce consistent with 
        any applicable State or local workforce investment 
        strategy, promotes the use of technology in economic 
        development (including access to high-speed 
        telecommunications), enhances and protects the 
        environment, and balances resources through sound 
        management of development; and

           *       *       *       *       *       *       *

    (c) Approval of Other Plan.--[The Secretary]
            (1) In general.--The Secretary may accept as a 
        comprehensive economic development strategy a 
        satisfactory plan developed under another federally 
        supported program.
            (2) Existing strategy.--To the maximum extent 
        practicable, a plan submitted under this paragraph 
        shall be consistent and coordinated with any existing 
        comprehensive economic development strategy for the 
        area.

           *       *       *       *       *       *       *


[SEC. 403. INCENTIVES.

    [(a) In General.--Subject to the non-Federal share 
requirement under section 205(c)(1), the Secretary may increase 
the amount of grant assistance for a project in an economic 
development district by an amount that does not exceed 10 
percent of the cost of the project, in accordance with such 
regulations as the Secretary shall promulgate, if--
            [(1) the project applicant is actively 
        participating in the economic development activities of 
        the district; and
            [(2) the project is consistent with the 
        comprehensive economic development strategy of the 
        district.
    [(b) Review of Incentive System.--In promulgating 
regulations under subsection (a), the Secretary shall review 
the current incentive system to ensure that the system is 
administered in the most direct and effective manner to achieve 
active participation by project applicants in the economic 
development activities of economic development districts.]

           *       *       *       *       *       *       *


[SEC. 404. PROVISION OF COMPREHENSIVE ECONOMIC DEVELOPMENT STRATEGIES 
                    TO APPALACHIAN REGIONAL COMMISSION.

    [If any part of an economic development district is in the 
Appalachian region (as defined in section 403 of the 
Appalachian Regional Development Act of 1965 (40 U.S.C. App.)), 
the economic development district shall ensure that a copy of 
the comprehensive economic development strategy of the district 
is provided to the Appalachian Regional Commission established 
under that Act.]

SEC. 404. PROVISION OF COMPREHENSIVE ECONOMIC DEVELOPMENT STRATEGIES TO 
                    REGIONAL COMMISSIONS.

    If any part of an economic development district is in a 
region covered by 1 or more of the Regional Commissions, the 
economic development district shall ensure that a copy of the 
comprehensive economic development strategy of the district is 
provided to the affected Regional Commission.

           *       *       *       *       *       *       *


SEC. 502. ECONOMIC DEVELOPMENT INFORMATION CLEARINGHOUSE.

    In carrying out this Act, the Secretary shall--
            [(1) maintain a central information clearinghouse 
        on matters relating to economic development, economic 
        adjustment, disaster recovery, defense conversion, and 
        trade adjustment programs and activities of the Federal 
        and State governments, including political subdivisions 
        of States;]
            (1) maintain a central information clearinghouse on 
        the Internet with--
                    (A) information on economic development, 
                economic adjustment, disaster recovery, defense 
                conversion, and trade adjustment programs and 
                activities of the Federal Government;
                    (B) links to State economic development 
                organizations; and
                    (C) links to other appropriate economic 
                development resources;
            [(2) assist potential and actual applicants for 
        economic development, economic adjustment, disaster 
        recovery, defense conversion, and trade adjustment 
        assistance under Federal, State, and local laws in 
        locating and applying for the assistance; and]
            (2) assist potential and actual applicants for 
        economic development, economic adjustment, disaster 
        recovery, defense conversion, and trade adjustment 
        assistance under Federal and State laws in locating and 
        applying for the assistance;
            (3) assist areas described in section 301(a) and 
        other areas by providing to interested persons, 
        communities, industries, and businesses in the areas 
        any technical information, market research, or other 
        forms of assistance, information, or advice that would 
        be useful in alleviating or preventing conditions of 
        excessive unemployment or underemployment in the 
        areas[.] ; and
            (4) obtain appropriate information from other 
        Federal agencies needed to carry out the duties under 
        this Act.

           *       *       *       *       *       *       *


[SEC. 505. BUSINESSES DESIRING FEDERAL CONTRACTS.

    [The Secretary may provide the procurement divisions of 
Federal agencies with a list consisting of--
            [(1) the names and addresses of businesses that are 
        located in areas described in section 301(a) and that 
        wish to obtain Federal Government contracts for the 
        provision of supplies or services; and
            [(2) the supplies and services that each business 
        provides.]

           *       *       *       *       *       *       *


SEC. 506. PERFORMANCE EVALUATIONS OF GRANT RECIPIENTS.

    (a) In General.-- * * *

           *       *       *       *       *       *       *

    (c) Timing of Evaluations.--Evaluations under subsection 
(a) shall be conducted on a continuing basis so that each 
grantee is evaluated within 3 years after the first award of 
assistance to the grantee [after the effective date of the 
Economic Development Administration Reform Act of 1998], and at 
least once every 3 years thereafter, so long as the grantee 
receives the assistance.
    (d) Evaluation Criteria.--
            (1) Establishment.--The Secretary shall establish 
        criteria for use in conducting evaluations under 
        subsection (a).
            (2) Evaluation criteria for university centers.--
        The criteria for evaluation of a university center 
        shall, at a minimum, provide for an assessment of the 
        center's contribution to providing technical 
        assistance, conducting applied research, program 
        performance, and disseminating results of the 
        activities of the center.

           *       *       *       *       *       *       *


SEC. 602. MAINTENANCE OF STANDARDS.

    All laborers and mechanics employed by contractors or 
subcontractors on projects assisted by the Secretary under this 
Act shall be paid wages at rates not less than those prevailing 
on smiliar construction in the locality as determined by the 
Secretary of Labor [in accordance with the Davis-Bacon Act, as 
amended (40 U.S.C. 276a-276a-5)] in accordance with subchapter 
IV of chapter 31 of title 40, United States Code. The Secretary 
shall not extend any financial assistance under this Act, for 
such project without first obtaining adequate assurance that 
these labor standards will be maintained upon the cosntruction 
work. The Secretary of Labor shall have, with respect to the 
labor standards specified in this provision, the authority and 
functions sent forth in Reorganization Plan Numbered 14 of 1950 
(15 F.R. 3176; 64 Stat. 1267; 5 U.S.C. 133z-15), and [section 2 
of the Act of June 13, 1934, as amended (40 U.S.C. 276c)] 
section 3145 of title 40, United States Code.

           *       *       *       *       *       *       *


SEC. 603. ANNUAL REPORT TO CONGRESS.

    [Not later]
    (a) In General.--Not later than July 1, 2000, and July 1 of 
each year thereafter, the Secretary shall submit to Congress a 
comprehensive and detailed annual report on the activities of 
the Secretary under this Act during the most recently completed 
fiscal year.
    (b) Inclusions.--Each report required under subsection (a) 
shall--
            (1) include a list of the waivers issued under 
        section 218(c)(3)(C);
            (2) include a list of all grant recipients by 
        State, including the projected private sector dollar to 
        Federal dollar investment ratio for each grant 
        recipient;
            (3) include a discussion of any private sector 
        leveraging goal with respect to grants awarded to--
                    (A) rural and urban economically distressed 
                areas; and
                    (B) highly distressed areas; and
            (4) after the completion of a project, include the 
        realized private sector dollar to Federal dollar 
        investment ratio for the project.

           *       *       *       *       *       *       *


SEC. 609. RELATIONSHIP TO ASSISTANCE UNDER OTHER LAW.

    [(a) Previously Authorized Assistance.--Except as otherwise 
provided in this Act, all financial and technical assistance 
authorized under this Act shall be in addition to any Federal 
assistance authorized before the effective date of the Economic 
Development Administration Reform Act of 1998.]
    [(b) Assistance Under Other Acts.--]Nothing in this Act 
authorizes or permits any reduction in the amount of Federal 
assistance that any State or other entity eligible under this 
Act is entitled to receive under any other Act.

           *       *       *       *       *       *       *


[SEC. 701. GENERAL AUTHORIZATION OF APPROPRIATIONS.

    [There are authorized to be appropriated to carry out this 
Act $397,969,000 for fiscal year 1999, $368,000,000 for fiscal 
year 2000, $335,000,000 for fiscal year 2001, $335,000,000 for 
fiscal year 2002, and $335,000,000 for fiscal year 2003, to 
remain available until expended.]

SEC. 701. GENERAL AUTHORIZATION OF APPROPRIATIONS.

    (a) Economic Development Assistance Programs.--There are 
authorized to be appropriated for economic development 
assistance programs to carry out this Act, to remain available 
until expended--
            (1) $400,000,000 for fiscal year 2004;
            (2) $425,000,000 for fiscal year 2005;
            (3) $450,000,000 for fiscal year 2006;
            (4) $475,000,000 for fiscal year 2007; and
            (5) $500,000,000 for fiscal year 2008.''
    (b) Salaries and Expenses.--There are authorized to be 
appropriated for salaries and expenses of administering this 
Act, to remain available until expended--
            (1) $33,377,000 for fiscal year 2004; and
            (2) such sums as are necessary for each fiscal year 
        thereafter.

           *       *       *       *       *       *       *


SEC. 704. FUNDING FOR GRANTS FOR PLANNING AND GRANTS FOR ADMINISTRATIVE 
                    EXPENSES.

    (a) In General.--Of the amounts made available under 
section 701 for each fiscal year, not less than $27,000,000 
shall be made available for grants provided under section 203.
    (b) Waiver.--Subsection (a) shall not apply in any case in 
which the total amount made available for a fiscal year for all 
programs under this Act (excluding programs described in 
paragraphs (1) and (2) of section 209(c)) is less than 
$255,000,000.

                                 
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