# Presentation: 703833

## U.S. Department of CommerceEconomic Development Administration

- Overview of Fiscal Year 2007 Budget

- May 2006

## The Bush Administration & EDA

- The Administration supports EDA’s mission:
- For FY 2007, The President’s budget request calls for an increase of $47 million (total program budget: $297.5 million).
- The Administration successfully sought and achieved EDA reauthorization in 2004.

## Continuity of Programs

- 	For FY 2007, the critical parameters of EDA’s program remain unchanged:
- Eligibility requirements unchanged.
- Portfolio of programs maintained.
- Focus on areas of economic distress unaltered.

## New At EDA for FY 2007

- 	Changes to EDA are *evolutionary*, not revolutionary:
- Places greater emphasis on coordinated regional economic development approaches.
- Streamlines access to EDA’s most popular programs through a unified “Regional Development Account.”
- Continues to support investments that advance competitiveness, innovation, and entrepreneurship.

## Evolution: Focus on Regional Development Approaches

- 	Since its inception, EDA has emphasized *regional* approaches; this focus will be enhanced by providing resources to:
- Create tools development professionals can use to identify and assess their regional assets.
- Support communities that want to work together to develop collaborative regional development approaches.
- Increase the focus on regional strengths and opportunities during the project development stage.

## Evolution: The Regional Development Account (RDA)

- 	EDA currently has four separate programs with overlapping goals.  Simply, the RDA:
- Continues the activities of Public Works, Economic Adjustment, Technical Assistance and Research within a single program account.
- Is modeled after the Economic Adjustment account, EDA’s most flexible program.
- Allows investment partners to engage simultaneously in multiple activities with just one EDA grant (e.g. infrastructure and technical assistance).
- Provides the agency greater flexibility to respond to changing economic conditions, including natural disasters.

## Regional Development: Why it is Important

- 	EDA is committed to encouraging areas to work together to focus on regional strengths:
- The most globally competitive areas approach economic opportunities on a regional basis – they focus on their regional competitive advantage.
- Development experts agree that collaborative, coordinated development approaches can increase economic performance.
- Communities should understand the opportunities presented by today’s global marketplace – and how best to successfully compete.
- Areas are stronger when they work together to capitalize on shared regional assets (e.g. education institutions, research facilities, industry clusters).

## Regional Development: Benefits to Small & Rural Areas

- 	Historically, over 50% of EDA infrastructure investments flow to rural areas.  Regional development approaches:
- Ensure that small and rural communities have a “seat at the table.”
- Enable small distressed communities within the region to leverage the assets of the entire area to their benefit.
- Develop a partnership relationship between small and rural areas with economic hubs.

*EDA will maintain its commitment to rural areas and policy issues that matter to rural America.*

## Support for Capacity Building

- 	EDA recognizes that local officials and development organizations require specialized knowledge and skills:
- EDA will financially support all recognized Economic Development Districts.
- EDA will develop tools and offer resources to help develop functioning economic regions across America.
- EDA will offer additional financial resources to development organizations that seek to collaborate with other entities on broader regional approaches.

## Funding Priorities

- 	EDA is adapting to our growing focus on regional economic development.  The FY 2006 funding priorities reflect this evolution and encourage:
- Investments in support of long-term, coordinated and collaborative regional economic development approaches
- Investments that support innovation and competitiveness
- Investments that support entrepreneurship

## The American Competitiveness Initiative (ACI)

- 	The ACI acknowledges that competitiveness and innovation are America’s long-term strategic advantages in the global economy.
- The largest sustained increase of federal investment in research and development, education, and worker-training to support innovation, entrepreneurship and economic growth since the Apollo space program in the early 1960’s.
- $50 billion increase in research funding and $86 billion for research and development tax incentives over 10 years.
- EDA’s programs will help assist distressed communities to integrate their development strategies with the activities of President Bush’s new American Competitiveness Initiative, which include investment in R&D, science, education and workforce training, and support for business environments that encourage entrepreneurship.

## Strengthening America’s Communities Initiative (SACI)

- 	The Bush Administration continues to support the broad principles of SACI:
- CDBG remains at HUD, and will develop a reform proposal that reflects the broad goals of SACI.
- EDA remains at Commerce, and the Economic Development Assistance Program (EDAP) continues as authorized.
- An Interagency Council will be formed to better coordinate activities and performance measurements across Federal development programs.

## EDA Program Budget At-A-Glance: $297 million

| Regional Development Account (RDA)
$257 million | Partnership
Planning
$27 million | TAA for Firms
$13 million |
| --- | --- | --- |
| Capacity Building Investments:
Research
Education and competitiveness tools and training
Analysis of linkages and competitive advantages
Understanding role of innovation and entrepreneurship in development strategy 
Public Works:
Multiple activities (strategy, planning, technical assistance, public works)
Infrastructure development and engineering

Economic Adjustment:
Support regional innovation initiatives and efforts to bolster entrepreneurship
Respond to sudden and severe economic dislocation | 
Continued support for Partnership Planning program funding Districts to develop and execute Comprehensive Economic Development Strategies (CEDS)
Incentives for Districts to participate in broader regional development efforts | 
Continued support for network of Trade Adjustment Assistance Centers to help manufacturers and producers respond to the world-wide marketplace

Focus on industrial innovation |