A bill to amend the Public Works and Economic Development Act of 1965 to modify the period used to calculate certain unemployment rates, to encourage the development of business incubators, and for other purposes.

Summary: Business Incubator Promotion Act - Amends the Public Works and Economic Development Act to include among the Act's goals encouraging distressed communities to support the formation of business incubators to promote innovation and entrepreneurship in economically distressed areas.

Defines "business incubator" as an entity established to foster the startup of businesses or accelerate the growth of fledgling companies by providing entrepreneurs with resources and services to produce viable businesses that can help create jobs and restore vitality to distressed areas, excluding an entity organized primarily as for-profit venture.

Modifies criteria for the eligibility of an area for grants under such Act for public works and economic development or economic adjustment projects to require an area to have had an unemployment rate of at least 1% greater than the national average for the most recent 12-month (currently, 24-month) period for which data are available.

Authorizes the Secretary of Commerce to: (1) increase the federal share for public works and economic development project grants based upon an area's unemployment rate or per capita income compared to the national average; and (2) reduce or waive the non-federal or local share required for participation in such grant assistance for a special need area in cases of severe economic distress.

Authorizes the Secretary to provide competitive grants for: (1) the development and implementation of feasibility studies and plans for the creation or expansion of business incubators; and (2) the temporary support of operations of business incubators that is essential to self-sustainability.

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Business Incubator Promotion Act''.

SEC. 2. DEVELOPMENT OF BUSINESS INCUBATORS.

    Section 2(b) of the Public Works and Economic Development Act (42 
U.S.C. 3121(b)) is amended by striking paragraph (3) and inserting the 
following:
            ``(3) whether suffering from long-term distress or a sudden 
        economic dislocation, distressed communities should be 
        encouraged to support the formation of business incubators to 
        promote innovation and entrepreneurship in economically 
        distressed areas and to take other actions to support 
        entrepreneurship, so as to help regions to create higher-skill, 
        higher-wage jobs and foster the participation of those regions 
        in the global marketplace; and''.

SEC. 3. DEFINITIONS.

    Section 3 of the Public Works and Economic Development Act (42 
U.S.C. 3122) is amended--
            (1) by redesignating paragraphs (1) through (12) as 
        paragraphs (2) through (13), respectively; and
            (2) by inserting before paragraph (2) (as redesignated by 
        paragraph (1)) the following:
            ``(1) Business incubator.--
                    ``(A) In general.--The term `business incubator' 
                means an organization or entity established to foster 
                the start-up of businesses or accelerate the growth of 
                fledgling companies by providing entrepreneurs with 
                resources and services to produce viable businesses 
                that can help create jobs and restore vitality to 
                distressed areas.
                    ``(B) Exclusion.--The term `business incubator' 
                does not include an organization or entity that is 
                organized primarily as a for-profit venture.''.

SEC. 4. UNEMPLOYMENT RATE.

    Section 301(a)(2) of the Public Works and Economic Development Act 
of 1965 (42 U.S.C. 3161(a)(2)) is amended by striking ``24-month 
period'' and inserting ``12-month period''.

SEC. 5. INCREASE IN FEDERAL SHARE; SPECIAL NEED AREAS.

    Section 204(c) of the Public Works and Economic Development Act of 
1965 (42 U.S.C. 3144(c)) is amended--
            (1) by redesignating paragraphs (1) through (3) as 
        paragraphs (2) through (4), respectively;
            (2) by inserting before paragraph (2) (as redesignated by 
        paragraph (1)) the following:
            ``(1) Relative needs of an area.--
                    ``(A) 175-percent higher unemployment rate.--In the 
                case of a grant made in an area for which the 12-month 
                unemployment rate is at least 175 percent of the 
                national average or the per capita income is not more 
                than 60 percent of the national average, the Secretary 
                may increase the Federal share above the percentage 
                specified in subsection (a) up to 80 percent of the 
                cost of the project.
                    ``(B) 150-percent higher unemployment rate.--In the 
                case of a grant made in an area for which the 12-month 
                unemployment rate is at least 150 percent of the 
                national average or the per capita income is not more 
                than 65 percent of the national average, the Secretary 
                may increase the Federal share above the percentage 
                specified in subsection (a) up to 70 percent of the 
                cost of the project.
                    ``(C) 125-percent higher unemployment rate.--In the 
                case of a grant made in an area for which the 12-month 
                unemployment rate is at least 125 percent of the 
                national average or the per capita income is not more 
                than 70 percent of the national average, the Secretary 
                may increase the Federal share above the percentage 
                specified in subsection (a) up to 60 percent of the 
                cost of the project.
                    ``(D) Unemployment rate greater than national 
                average.--In the case of a grant made in an area for 
                which the 12-month unemployment rate is at least 1 
                percentage point greater than the national 12-month 
                unemployment rate or the per capita income is not more 
                than 80 percent of the national average, the Secretary 
                may increase the Federal share above the percentage 
                specified in subsection (a) up to 50 percent of the 
                cost of the project.''; and
            (3) by adding at the end the following:
            ``(5) Special need areas.--In any case of severe economic 
        distress during which grant rates based on relative need as 
        required under subsection (a) result in a level for the non-
        Federal share that prevents eligible recipients in a particular 
        area from participating in grant assistance under this Act, the 
        Secretary may--
                    ``(A) deem the area to be experiencing a special 
                need under section 301(a)(3);
                    ``(B) reduce the non-Federal share to 20 percent of 
                the cost of a project; and
                    ``(C) waive the local share below that amount, or 
                entirely, if the unemployment rate exceeds 12 percent 
                or otherwise meets the requirements of paragraph 
                (3).''.

SEC. 6. BUSINESS INCUBATORS.

    Title II of the Public Works and Economic Development Act of 1965 
is amended by inserting after section 207 (42 U.S.C. 3147) the 
following:

``SEC. 208. BUSINESS INCUBATORS.

    ``(a) Development of Plans for Creation or Expansion of Business 
Incubators.--On receipt of an application from an eligible recipient 
(as determined by the Secretary in accordance with subsection (c)), the 
Secretary may provide grants to the eligible recipient for--
            ``(1) the development of feasibility studies and plans for 
        the creation of new, or expansion of existing, business 
        incubators;
            ``(2) the implementation of those studies and plans by 
        supporting the creation of new or expansion of existing 
        business incubators and related programmatic and technical 
        assistance; and
            ``(3) the temporary support of operations of business 
        incubators, to the extent that the Secretary determines that 
        the support is essential to assist a business incubator in 
        becoming self-sustainable.
    ``(b) Limitation on Amount of Grants.--The amount of a grant 
provided to an eligible recipient under this section may not exceed--
            ``(1) $750,000, if the grant is to be used for feasibility 
        studies and plans; or
            ``(2) $3,000,000, if the grant is to be used for 
        implementation of those studies and plans.
    ``(c) Procedure for Providing Grants.--
            ``(1) Competitive process required.--The Secretary shall 
        provide each grant under this section to an eligible recipient 
        selected pursuant to a competitive process.
            ``(2) Selection criteria.--The Secretary shall publish the 
        criteria to be used in any competition under this paragraph for 
        the selection of eligible recipients of grants under this 
        section, including requirements relating to--
                    ``(A) the projected number of jobs required to be 
                created at a new or expanded business incubator for 
                each of the first 6 years after the date of receipt of 
                the grant;
                    ``(B) the funding to be required to create or 
                expand a business incubator during the first 5 years 
                after the date of receipt of the grant;
                    ``(C) the types of businesses and research entities 
                expected in the business incubator and surrounding 
                community;
                    ``(D) letters of intent by businesses and research 
                entities to establish a location in the business 
                incubator;
                    ``(E) the capability to attract a well-trained 
                workforce to the business incubator;
                    ``(F) the management of the business incubator; and
                    ``(G) such other factors as the Secretary 
                determines to be appropriate.
    ``(d) Authorization of Appropriations.--
            ``(1) In general.--There are authorized to be appropriated 
        to carry out this section such sums as are necessary for fiscal 
        year 2010 and each fiscal year thereafter.
            ``(2) Availability.--Amounts made available pursuant to 
        paragraph (1) for a fiscal year shall remain available until 
        the end of the second fiscal year following the fiscal year in 
        which the amounts were first made available.''.