II 

110TH CONGRESS 

1ST SESSION S. 1034 

To create investment opportunities for rural families and access to credit 

for rural entrepreneurs and microenterprises, to support rural regional 

investment, and for other purposes. 

IN THE SENATE OF THE UNITED STATES 

MARCH 29, 2007 

Mrs. CLINTON introduced the following bill; which was read twice and referred 

to the Committee on Finance 

A BILL 

To create investment opportunities for rural families and 

access to credit for rural entrepreneurs and microenterprises, to support rural regional investment, and for 

other purposes. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE; TABLE OF CONTENTS. 

4 (a) SHORT TITLE.—This Act may be cited as the 

5 ‘‘Rural Investment to Strengthen our Economy Act of 

6 2007’’ or the ‘‘Rural RISE Act’’. 

7 (b) TABLE OF CONTENTS.—The table of contents for 

8 this Act is as follows: 


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Sec. 1. Short title; table of contents. 

TITLE I—NEW FINANCIAL OPPORTUNITIES FOR RURAL 

AMERICANS 

Sec. 101. Capital loss deduction allowed with respect to sale or exchange of 

principal residence in certain rural areas. 

Sec. 102. Rural student loan forgiveness. 

TITLE II—ACCESS TO CREDIT FOR RURAL ENTREPRENEURS AND 

MICROENTERPRISES 

Sec. 201. Rural entrepreneurship and microenterprise program. 

TITLE III—RURAL REGIONAL INVESTMENT INITIATIVE 

Sec. 301. Rural regional investment initiative. 

Sec. 302. Rural regional entrepreneurship program. 

TITLE IV—REGIONAL SKILLS ALLIANCES 

Sec. 401. Findings. 

Sec. 402. Definition of Secretary. 

Subtitle A—Skill Grants 

Sec. 411. Authorization. 

Sec. 412. Use of amounts. 

Sec. 413. Requirement of matching funds. 

Sec. 414. Limit on administrative expenses. 

Sec. 415. Authorization of appropriations. 

Subtitle B—Planning Grants 

Sec. 421. Authorization. 

Sec. 422. Application. 

Sec. 423. Requirement of matching funds. 

Sec. 424. Authorization of appropriations. 

TITLE V—SMALL BUSINESS JOBS TAX CREDIT 

Sec. 501. Expansion of work opportunity tax credit. 


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1 TITLE I—NEW FINANCIAL OP2 PORTUNITIES FOR RURAL 

3 AMERICANS 

4 SEC. 101. CAPITAL LOSS DEDUCTION ALLOWED WITH RE5 SPECT TO SALE OR EXCHANGE OF PRINCIPAL 

6 RESIDENCE IN CERTAIN RURAL AREAS. 

7 (a) IN GENERAL.—Subsection (c) of section 165 of 

8 the Internal Revenue Code of 1986 (relating to limitation 

9 on losses of individuals) is amended— 

10 (1) by striking ‘‘and’’ at the end of paragraph 

11 (2), 

12 (2) by striking the period at the end of para13 graph (3) and inserting ‘‘; and’’, and 

14 (3) by adding at the end the following new 

15 paragraph: 

16 ‘‘(4) losses arising from the sale or exchange of 

17 the principal residence (within the meaning of sec18 tion 121) of the taxpayer, but only if such principal 

19 residence— 

20 ‘‘(A) is located in a nonmetropolitan coun21 ty which, based on information contained in the 

22 2000 decennial census, has a population which 

23 resides in areas more than 50 percent of which 

24 are classified as rural by the Secretary of Agri25 culture, and 


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1 ‘‘(B) was acquired by the taxpayer after 

2 the date of the enactment of this paragraph.’’. 

3 (b) CONFORMING AMENDMENT.—Section 67(b)(3) is 

4 amended by striking ‘‘paragraph (2) or (3)’’ and inserting 

5 ‘‘paragraph (2), (3), or (4)’’. 

6 (c) EFFECTIVE DATE.—The amendments made by 

7 this section shall apply to sales and exchanges after the 

8 date of the enactment of this Act, in taxable years ending 

9 after such date. 

10 SEC. 102. RURAL STUDENT LOAN FORGIVENESS. 

11 (a) DEFINITIONS.—In this section: 

12 (1) DEGREE.—The term ‘‘degree’’ means an as13 sociate’s degree or baccalaureate degree awarded by 

14 an institution of higher education. 

15 (2) ELIGIBLE BORROWER.—The term ‘‘eligible 

16 borrower’’ means any borrower who is not in default 

17 on any of the borrower’s student loans under part 

18 B, D, or E of title IV of the Higher Education Act 

19 of 1965. 

20 (3) INSTITUTION OF HIGHER EDUCATION.—The 

21 term ‘‘institution of higher education’’ has the 

22 meaning given the term in section 101 of the Higher 

23 Education Act of 1965 (20 U.S.C. 1001). 

24 (4) ELIGIBLE AREA.—The term ‘‘eligible area’’ 

25 means a nonmetropolitan county that, based on inVerDate Aug 31 2005 01:50 Apr 11, 2007 Jkt 059200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\S1034.IS S1034

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1 formation contained in the 2000 decennial census, 

2 has a population that resides in areas more than 50 

3 percent of which are classified as rural by the Sec4 retary of Agriculture. 

5 (5) SECRETARY.—The term ‘‘Secretary’’ means 

6 the Secretary of Education. 

7 (b) PROGRAM.— 

8 (1) IN GENERAL.—The Secretary shall carry 

9 out a program of assuming or cancelling the obliga10 tion to repay, pursuant to subsection (c), a loan 

11 made, insured, or guaranteed under part B, D, or 

12 E of title IV of the Higher Education Act of 1965 

13 (20 U.S.C. 1071 et seq., 20 U.S.C. 1087a et seq., 

14 20 U.S.C. 1087aa et seq.), excluding loans made 

15 under section 428B of such Act or comparable loans 

16 made under part D of such Act, for any borrower 

17 who— 

18 (A) obtains a degree; 

19 (B) resides in an eligible area; and 

20 (C) is employed in an eligible area. 

21 (2) REGULATIONS.—The Secretary is author22 ized to prescribe such regulations as may be nec23 essary to carry out the provisions of this section. 

24 (c) LOAN REPAYMENT OR CANCELLATION.— 


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1 (1) IN GENERAL.—The Secretary shall assume 

2 or cancel the obligation to repay, after each of the 

3 first 5 years of the residency and employment de4 scribed in subparagraphs (B) and (C) of subsection 

5 (b)(1) that occur after the date of enactment of this 

6 Act, 10 percent of the total amount of all loans 

7 made to a student under the provisions of title IV 

8 of the Higher Education Act of 1965 as described 

9 in subsection (b)(1), up to a maximum amount of 

10 $2,000 each year. 

11 (2) CONSTRUCTION.—Nothing in this section 

12 shall be construed to authorize the refunding of any 

13 repayment of a loan made, insured, or guaranteed 

14 under part B, D, or E of title IV of the Higher Edu15 cation Act of 1965. 

16 (3) INTEREST.—If a portion of a loan is repaid 

17 or cancelled by the Secretary under this section for 

18 any year, the proportionate amount of interest on 

19 such loan that accrues for such year shall be repaid 

20 or cancelled by the Secretary so long as the total 

21 amount repaid or cancelled by the Secretary in any 

22 1 year does not exceed $2,000. 

23 (d) REPAYMENT TO ELIGIBLE LENDERS.—The Sec24 retary shall pay to each eligible lender or holder for each 

25 fiscal year an amount equal to the aggregate amount of 


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1 loans which are subject to repayment pursuant to this sec2 tion for such year. 

3 (e) APPLICATION FOR REPAYMENT OR CANCELLA4 TION.— 

5 (1) IN GENERAL.—An eligible borrower desiring 

6 loan repayment or cancellation under this section 

7 shall submit a complete and accurate application to 

8 the Secretary at such time, in such manner, and 

9 containing such information as the Secretary may 

10 require. 

11 (2) CONDITIONS.—An eligible borrower may 

12 apply for loan repayment or cancellation under this 

13 section after completing each year of qualifying resi14 dency and employment. The eligible borrower shall 

15 receive forbearance while engaged in qualifying resi16 dency and employment unless the borrower is in 

17 deferment while so engaged. 

18 (f) AUTHORIZATION OF APPROPRIATIONS.— 

19 (1) LOAN REPAYMENT AND CANCELLATION.— 

20 There are authorized to be appropriated to carry out 

21 this section such sums as may be necessary. 

22 (2) PERKINS LOAN FUNDS.—There are author23 ized to be appropriated such sums as may be nec24 essary for Federal capital contributions to student 


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1 loan funds established under part E of title IV of 

2 the Higher Education Act of 1965. 

3 (g) REPAYMENT OR CANCELLATION EXCLUDED

4 FROM GROSS INCOME.—Section 108(f)(1) of the Internal 

5 Revenue Code of 1986 (relating to student loans) is 

6 amended by inserting ‘‘or pursuant to section 102 of the 

7 Rural Investment to Strengthen our Economy Act of 

8 2007’’ after ‘‘employers’’. 

9 TITLE II—ACCESS TO CREDIT 

10 FOR RURAL ENTREPRENEURS 

11 AND MICROENTERPRISES 

12 SEC. 201. RURAL ENTREPRENEURSHIP AND MICROENTER13 PRISE PROGRAM. 

14 Subtitle D of the Consolidated Farm and Rural De15 velopment Act is amended by inserting after section 364 

16 (7 U.S.C. 2006f) the following: 

17 ‘‘SEC. 365. RURAL ENTREPRENEURSHIP AND MICROENTER18 PRISE PROGRAM. 

19 ‘‘(a) DEFINITIONS.—In this section: 

20 ‘‘(1) ECONOMICALLY DISADVANTAGED MICRO21 ENTREPRENEUR.—The term ‘economically disadvan22 taged microentrepreneur’ means an owner, majority 

23 owner, or developer of a microenterprise in an eligi24 ble area that has the ability to compete in the pri25 vate sector but has been impaired due to diminished 


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1 capital and credit opportunities, as compared to 

2 other microentrepreneurs in the industry. 

3 ‘‘(2) ELIGIBLE AREA.—The term ‘eligible area’ 

4 means a nonmetropolitan county that, based on in5 formation contained in the 2000 decennial census, 

6 has a population that resides in areas more than 50 

7 percent of which are classified as rural by the Sec8 retary. 

9 ‘‘(3) INDIAN TRIBE.—The term ‘Indian tribe’ 

10 has the meaning given the term in section 4 of the 

11 Indian Self-Determination and Education Assistance 

12 Act (25 U.S.C. 450b). 

13 ‘‘(4) INTERMEDIARY.—The term ‘intermediary’ 

14 means an entity that— 

15 ‘‘(A) makes and services microloans to eli16 gible small business concerns; and 

17 ‘‘(B) provides marketing, management, 

18 and technical assistance to borrowers, includ19 ing— 

20 ‘‘(i) a microenterprise development or21 ganization or program; 

22 ‘‘(ii) a private, nonprofit community 

23 development corporation; 


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1 ‘‘(iii) a consortium of private, non2 profit community development corporations 

3 or other entities; 

4 ‘‘(iv) a quasi-governmental economic 

5 development entity, other than a State, 

6 county, municipal government, or any 

7 agency of a State, county, or municipal 

8 government; or 

9 ‘‘(v) an agency of, or a nonprofit enti10 ty established by, a tribal government. 

11 ‘‘(5) LOW-INCOME INDIVIDUAL.—The term 

12 ‘low-income individual’ means an individual with an 

13 income (adjusted for family size) of not more than 

14 the greater of— 

15 ‘‘(A) 80 percent of median income of an 

16 area; or 

17 ‘‘(B) 80 percent of the statewide non18 metropolitan area median income. 

19 ‘‘(6) MICROCREDIT.—The term ‘microcredit’ 

20 means a business loan or loan guarantee of not more 

21 than $50,000 provided to a rural entrepreneur. 

22 ‘‘(7) MICROENTERPRISE.—The term ‘micro23 enterprise’ means a sole proprietorship, joint enter24 prise, limited liability company, partnership, cor25 poration, or cooperative that— 


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1 ‘‘(A) has 5 or fewer employees; and 

2 ‘‘(B) is unable to obtain sufficient credit, 

3 equity, or banking services elsewhere, as deter4 mined by the Secretary. 

5 ‘‘(8) MICROENTERPRISE DEVELOPMENT ORGA6 NIZATION.— 

7 ‘‘(A) IN GENERAL.—The term ‘microenter8 prise development organization’ means a non9 profit entity that provides training and tech10 nical assistance to rural entrepreneurs and ac11 cess to capital or another service described in 

12 subsection (b) to rural entrepreneurs. 

13 ‘‘(B) INCLUSIONS.—The term ‘microenter14 prise development organization’ includes an or15 ganization described in subparagraph (A) with 

16 a demonstrated record of delivering services to 

17 economically disadvantaged microentrepreneurs. 

18 ‘‘(9) MICROENTERPRISE DEVELOPMENT PRO19 GRAM.—The term ‘microenterprise development or20 ganization’ means a program administered by a or21 ganization serving an eligible area. 

22 ‘‘(10) MICROENTREPRENEUR.—The term 

23 ‘microentrepreneur’ means the owner, operator, or 

24 developer of a microenterprise. 


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1 ‘‘(11) PROGRAM.—The term ‘program’ means 

2 the rural entrepreneur and microenterprise program 

3 established under subsection (b)(1). 

4 ‘‘(12) QUALIFIED ORGANIZATION.—The term 

5 ‘qualified organization’ means— 

6 ‘‘(A) a microenterprise development orga7 nization or microenterprise development pro8 gram that has a demonstrated record of deliv9 ering microenterprise services to rural entre10 preneurs, as demonstrated by the development 

11 of an effective plan of action and the possession 

12 of necessary resources to deliver microenterprise 

13 services to rural entrepreneurs effectively, as 

14 determined by the Secretary; 

15 ‘‘(B) an intermediary that has a dem16 onstrated record of delivery assistance to micro17 enterprise development organizations or micro18 enterprise development programs; 

19 ‘‘(C) a microenterprise development orga20 nization or microenterprise development pro21 gram that— 

22 ‘‘(i) serves rural entrepreneurs; and 

23 ‘‘(ii) enters into an agreement with a 

24 local community, in conjunction with a 

25 State or local government or Indian tribe, 


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1 to provide assistance described in sub2 section (b); 

3 ‘‘(D) an Indian tribe, the tribal govern4 ment of which certifies to the Secretary that no 

5 microenterprise development organization or 

6 microenterprise development program exists 

7 under the jurisdiction of the Indian tribe; 

8 ‘‘(E) a group of 2 or more organizations or 

9 Indian tribes described in subparagraph (A), 

10 (B), (C), or (D) that agree to act jointly as a 

11 qualified organization under this section; or 

12 ‘‘(F) for purposes of subsection (b), an in13 stitution of higher education (as defined in sec14 tion 101(a) of the Higher Education Act of 

15 1965 (20 U.S.C. 1001(a))). 

16 ‘‘(13) RURAL CAPACITY BUILDING SERVICE.— 

17 The term ‘rural capacity building service’ means a 

18 service provided to an organization that— 

19 ‘‘(A) is, or is in the process of becoming, 

20 a microenterprise development organization or 

21 microenterprise development program; and 

22 ‘‘(B) serves eligible areas for the purpose 

23 of enhancing the ability of the organization to 

24 provide training, technical assistance, and other 

25 related services to rural entrepreneurs. 


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1 ‘‘(14) RURAL ENTREPRENEUR.—The term 

2 ‘rural entrepreneur’ means a microentrepreneur, or 

3 prospective microentrepreneur— 

4 ‘‘(A) the principal place of business of 

5 which is in an eligible area; and 

6 ‘‘(B) that is unable to obtain sufficient 

7 training, technical assistance, or microcredit 

8 elsewhere, as determined by the Secretary. 

9 ‘‘(15) SECRETARY.—The term ‘Secretary’ 

10 means the Secretary of Agriculture, acting through 

11 the Administrator of the Rural Business-Cooperative 

12 Service. 

13 ‘‘(16) SMALL BUSINESS CONCERN.—The term 

14 ‘small business concern’ has the meaning given the 

15 term in section 3 of the Small Business Act (15 

16 U.S.C. 632). 

17 ‘‘(17) TRAINING AND TECHNICAL AND FINAN18 CIAL ASSISTANCE.— 

19 ‘‘(A) IN GENERAL.—The term ‘training 

20 and technical and financial assistance’ means 

21 assistance provided to rural entrepreneurs to 

22 develop the skills the rural entrepreneurs need 

23 to plan, market, and manage their own busi24 ness. 


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1 ‘‘(B) INCLUSIONS.—The term ‘training 

2 and technical and financial assistance’ includes 

3 assistance provided for the purpose of— 

4 ‘‘(i) enhancing business planning, 

5 marketing, management, or financial man6 agement skills; and 

7 ‘‘(ii) obtaining microcredit. 

8 ‘‘(18) TRIBAL GOVERNMENT.—The term ‘tribal 

9 government’ means the governing body of an Indian 

10 tribe. 

11 ‘‘(b) RURAL ENTREPRENEUR AND MICROENTER12 PRISE PROGRAM.— 

13 ‘‘(1) IN GENERAL.—From amounts made avail14 able under subsection (h), the Secretary shall estab15 lish a rural entrepreneurship and microenterprise 

16 program. 

17 ‘‘(2) PURPOSES.—The purposes of the program 

18 are— 

19 ‘‘(A) to make grants to qualified organiza20 tions and intermediaries to be used for mar21 keting, management, and technical assistance to 

22 the target population of the program; 

23 ‘‘(B) to make grants to assist in research24 ing and developing the best practices in deliv25 ering and evaluating training, technical assistVerDate Aug 31 2005 01:50 Apr 11, 2007 Jkt 059200 PO 00000 Frm 00015 Fmt 6652 Sfmt 6201 E:\BILLS\S1034.IS S1034

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1 ance, and microcredit programs to rural entre2 preneurs; 

3 ‘‘(C) to make direct and guaranteed loans 

4 to qualified organizations and intermediaries for 

5 the purpose of making microloans to low-income 

6 individuals and moderate-income individuals in 

7 rural areas to establish and sustain new small 

8 business concerns; and 

9 ‘‘(D) to carry out such other projects and 

10 activities as the Secretary determines are con11 sistent with this section. 

12 ‘‘(3) ALLOCATION.—From the total amount of 

13 funds made available for a fiscal year to make 

14 grants and loans under this section, the Secretary 

15 shall ensure that not less than 50 percent of funds 

16 are used to carry out activities described in subpara17 graphs (A) and (B) of paragraph (2). 

18 ‘‘(c) GRANTS.— 

19 ‘‘(1) IN GENERAL.—A qualified organization or 

20 intermediary shall be eligible to receive a grant 

21 under the program to provide marketing, manage22 ment, and technical assistance to small business con23 cerns. 

24 ‘‘(2) GRANT LIMITATIONS.—No single qualified 

25 organization may receive more than 10 percent of 


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1 the total funds that are made available for a fiscal 

2 year to carry out this section. 

3 ‘‘(3) SUBGRANTS.—Subject to such regulations 

4 as the Secretary may promulgate, a qualified organi5 zation that receives a grant under this section may 

6 use the grant to provide assistance to other qualified 

7 organizations, including small or emerging qualified 

8 organizations. 

9 ‘‘(d) LOAN ADMINISTRATION.— 

10 ‘‘(1) IN GENERAL.—In carrying out the pro11 gram, the Secretary may provide loans to qualified 

12 organizations and intermediaries to provide micro13 credit to rural entrepreneurs and microenterprises, 

14 under such terms and conditions as the Secretary 

15 may prescribe. 

16 ‘‘(2) LOAN DURATION.—Loans made under this 

17 paragraph shall be for a term of 10 years. 

18 ‘‘(3) APPLICATION INTEREST RATES.—Loans 

19 made under this paragraph to a qualified organiza20 tion or intermediary shall bear an interest rate equal 

21 to 2 percentage points below the rate determined by 

22 the Secretary of the Treasury for obligations of the 

23 United States with a period of maturity of 5 years, 

24 adjusted to the nearest one-eighth of 1 percent. 


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1 ‘‘(e) ADMINISTRATIVE EXPENSES.—Not more than 

2 15 percent of the total amount of assistance received by 

3 a qualified organization of intermediary for a fiscal year 

4 under this section may be used for administrative ex5 penses. 

6 ‘‘(f) TARGETED POPULATIONS.—In making grants 

7 and loans under this section, the Secretary shall ensure, 

8 to the maximum extent practicable, that— 

9 ‘‘(1) grant and loan recipients include qualified 

10 organizations and intermediaries— 

11 ‘‘(A) of varying sizes; and 

12 ‘‘(B) that serve racially, ethnically and 

13 geographically diverse populations, and 

14 ‘‘(2) not less than 50 percent of the grants and 

15 loans made under this section are used to benefit 

16 low-income individuals, women, or minorities, as 

17 identified by the Secretary, including individuals re18 siding on Indian reservations. 

19 ‘‘(g) COST SHARE.— 

20 ‘‘(1) FEDERAL SHARE.—The Federal share of 

21 the cost of a project carried out using funds from 

22 a grant under this section shall be 75 percent. 

23 ‘‘(2) FORM OF NON-FEDERAL SHARE.—The 

24 non-Federal share of the cost of a project described 

25 in paragraph (1) may be provided— 


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1 ‘‘(A) by public funds, including funds ob2 tained through other Federal, State and local 

3 fees and grants; or 

4 ‘‘(B) by private funds. 

5 ‘‘(h) FUNDING.—There is authorized to be appro6 priated $30,000,000 to carry out this section.’’. 

7 TITLE III—RURAL REGIONAL 

8 INVESTMENT INITIATIVE 

9 SEC. 301. RURAL REGIONAL INVESTMENT INITIATIVE. 

10 (a) DEFINITION OF ELIGIBLE AREA.—Section 385B 

11 of the Consolidated Farm and Rural Development Act (7 

12 U.S.C. 2009dd–1) is amended by striking paragraph (3) 

13 and inserting the following: 

14 ‘‘(3) ELIGIBLE AREA.—The term ‘eligible area’ 

15 means a nonmetropolitan county that, based on in16 formation contained in the 2000 decennial census, 

17 has a population that resides in areas more than 50 

18 percent of which are classified as rural by the Sec19 retary.’’. 

20 (b) COMPOSITION OF REGIONAL BOARDS.—Section 

21 385C(b)(2)(A) of the Consolidated Farm and Rural Devel22 opment Act (7 U.S.C. 2009dd–2(b)(2)(A)) is amended by 

23 striking clauses (vi) and (vii) and inserting the following: 

24 ‘‘(vi) academic institutions, including 

25 community colleges; 


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1 ‘‘(vii) faith-based organizations; 

2 ‘‘(viii) other entities and organiza3 tions, as determined by the Regional 

4 Board; and 

5 ‘‘(ix) consortia of entities and organi6 zations described in clauses (i) through 

7 (viii).’’. 

8 (c) COMPOSITION OF NATIONAL BOARD ON RURAL

9 AMERICA.—Section 385D(b)(1)(A) of the Consolidated 

10 Farm and Rural Development Act (7 U.S.C. 2009dd– 

11 3(b)(1)(A)) is amended by striking clauses (iv) through 

12 (vii) and inserting the following: 

13 ‘‘(iv) representatives of State and 

14 local governments; 

15 ‘‘(v) representatives of the rural phil16 anthropic community; 

17 ‘‘(vi) representatives of Indian tribes 

18 (as defined in section 4 of the Indian Self19 Determination and Education Assistance 

20 Act (25 U.S.C. 450b)); 

21 ‘‘(vii) representatives of nonprofit or22 ganizations; 

23 ‘‘(viii) representatives of academic in24 stitutions, including community colleges; 

25 and 


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1 ‘‘(ix) representatives of such other en2 tities or organizations as the Secretary 

3 considers to be appropriate.’’. 

4 (d) AMOUNT OF GRANTS.—Section 385E of the Con5 solidated Farm and Rural Development Act (7 U.S.C. 

6 2009dd–4) is amended— 

7 (1) in subsection (a), by striking 

8 ‘‘$100,000,000’’ and inserting ‘‘$200,000,000 each 

9 year’’; and 

10 (2) in subsection (b)— 

11 (A) in the matter before paragraph (1), by 

12 inserting ‘‘each year’’ after ‘‘shall use’’; 

13 (B) in paragraph (1), by striking 

14 ‘‘$8,000,000’’ and inserting ‘‘$20,000,000’’; 

15 (C) in paragraph (2)— 

16 (i) by striking ‘‘$87,000,000’’ and in17 serting ‘‘$135,000,000’’; and 

18 (ii) by striking ‘‘and’’ at the end; 

19 (D) by redesignating paragraph (3) as 

20 paragraph (4); and 

21 (E) by inserting after paragraph (2) the 

22 following: 

23 ‘‘(3) not less than $40,000,000 to carry out 

24 section 385I; and’’. 


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1 (e) RURAL STRATEGIC INVESTMENT PLANNING

2 GRANTS.—Section 385F of the Consolidated Farm and 

3 Rural Development Act (7 U.S.C. 2009dd–5) is amend4 ed— 

5 (1) by striking subsection (c) and inserting the 

6 following: 

7 ‘‘(c) PREFERENCES.—In awarding planning grants, 

8 the National Board shall give a preference to planning 

9 grants that will be used— 

10 ‘‘(1) to address community capacity building 

11 and community sustainability; 

12 ‘‘(2) to incorporate other Federal agency devel13 opment plans; or 

14 ‘‘(3) to leverage available public and private as15 sets.’’; and 

16 (2) in subsection (d), by striking ‘‘$100,000’’ 

17 and inserting ‘‘$250,000’’. 

18 (f) INNOVATION GRANTS.—Section 385G of the Con19 solidated Farm and Rural Development Act (7 U.S.C. 

20 2009dd–6) is amended— 

21 (1) in subsection (a), by inserting ‘‘to be admin22 istered by the Office of Rural Development’’ after 

23 ‘‘innovation grants’’; 


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1 (2) in subsection (d)(7), by inserting ‘‘, includ2 ing poverty alleviation’’ before the period at the end; 

3 and 

4 (3) in subsection (e)— 

5 (A) by redesignating paragraph (4) as 

6 paragraph (5); and 

7 (B) by inserting after paragraph (3) the 

8 following: 

9 ‘‘(4) NON-FEDERAL ORGANIZATIONS.—A Re10 gional Board may select 1 or more non-Federal or11 ganizations to manage and use innovation grants ap12 proved and awarded under this section.’’. 

13 SEC. 302. RURAL REGIONAL ENTREPRENEURSHIP PRO14 GRAM. 

15 Subtitle I of the Consolidated Farm and Rural Devel16 opment Act (7 U.S.C. 2009dd et seq.) is amended by add17 ing at the end the following: 

18 ‘‘SEC. 385I. RURAL REGIONAL ENTREPRENEURSHIP PRO19 GRAM. 

20 ‘‘(a) DEFINITION OF RURAL ENTREPRENEUR.—The 

21 term ‘rural entrepreneur’ has the meaning given the term 

22 in section 365(a). 

23 ‘‘(b) PROGRAM.—The Secretary shall establish a 

24 rural regional entrepreneurship program under which the 

25 Secretary shall provide grants to stimulate rural entrepreVerDate Aug 31 2005 01:50 Apr 11, 2007 Jkt 059200 PO 00000 Frm 00023 Fmt 6652 Sfmt 6201 E:\BILLS\S1034.IS S1034

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1 neurship and provide technical assistance, research, and 

2 evaluation to rural entrepreneurs. 

3 ‘‘(c) BLOCK GRANTS.— 

4 ‘‘(1) IN GENERAL.—From amounts made avail5 able under subsection (f), the Secretary shall use 

6 $15,000,000 for each fiscal year to make block 

7 grants to States in accordance with this subsection. 

8 ‘‘(2) AMOUNT OF GRANT.—A grant to a State 

9 under this subsection for any fiscal year shall be in 

10 an amount that is, as determined by the National 

11 Board— 

12 ‘‘(A) not more than $400,000; and 

13 ‘‘(B) not less than $200,000. 

14 ‘‘(3) COST SHARE.—To be eligible to receive a 

15 grant under this subsection, a State shall match any 

16 grant funds received under this subsection with an 

17 equal or greater amount of non-Federal funds. 

18 ‘‘(4) USE OF FUNDS.—A State shall use funds 

19 received under this subsection to support multi-coun20 ty entrepreneurship development systems focused on 

21 eligible areas in consultation with the RUPRI Cen22 ter for Rural Entrepreneurship. 

23 ‘‘(d) COMPETITIVE REGIONAL ENTREPRENEURSHIP

24 GRANTS.— 


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1 ‘‘(1) IN GENERAL.—From amounts made avail2 able under subsection (f), the Secretary shall— 

3 ‘‘(A) transfer $15,000,000 for each fiscal 

4 year to the National Board to make regional 

5 entrepreneurship grants to rural entrepreneurs 

6 through a competitive application process; and 

7 ‘‘(B) use at least $10,000,000 to make 

8 grants to successful applicants identified as re9 gional intermediaries under subsection (e)(3). 

10 ‘‘(2) ADMINISTRATION.—The Under Secretary 

11 for Rural Development shall administer grants 

12 under this subsection. 

13 ‘‘(e) CENTER FOR RURAL ENTREPRENEURSHIP.— 

14 ‘‘(1) IN GENERAL.—From amounts made avail15 able under subsection (f), the Secretary shall trans16 fer $10,000,000 for each fiscal year to the RUPRI 

17 Center for Rural Entrepreneurship (referred to in 

18 this subsection as the ‘Center’) for use in accordance 

19 with this subsection. 

20 ‘‘(2) RESEARCH, EVALUATION, AND DATA COL21 LECTION AND ANALYSIS.— 

22 ‘‘(A) IN GENERAL.—Of the amount trans23 ferred to the Center under paragraph (1), the 

24 Center shall use $5,000,000 for each fiscal year 

25 to carry out research, evaluation, and data colVerDate Aug 31 2005 01:50 Apr 11, 2007 Jkt 059200 PO 00000 Frm 00025 Fmt 6652 Sfmt 6201 E:\BILLS\S1034.IS S1034

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1 lection and analysis programs, of which not less 

2 than $500,000 for each fiscal year shall be used 

3 to enter into contracts, in accordance with a na4 tional research agenda approved by the Na5 tional Board, with each of— 

6 ‘‘(i) the regional rural development 

7 centers described in section 1670(a) of the 

8 Food, Agriculture, Conservation, and 

9 Trade Act of 1990 (7 U.S.C. 5923(a)); 

10 and 

11 ‘‘(ii) the Economic Research Service. 

12 ‘‘(B) COORDINATION AND FOCUS OF PRO13 GRAMS.—The programs carried out under this 

14 paragraph shall— 

15 ‘‘(i) be coordinated by the Center 

16 across a broad range of higher education 

17 institutions and research organizations; 

18 and 

19 ‘‘(ii) focus on providing insights and 

20 creating opportunities for sustained entre21 preneurship development in rural areas of 

22 the United States. 

23 ‘‘(3) REGIONAL INTERMEDIARIES.—Of the 

24 amount transferred to the Center under paragraph 

25 (1), the Center shall use $4,000,000 for each fiscal 


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1 year to establish and maintain a nationwide network 

2 of regional intermediaries with the capacity and 

3 tools— 

4 ‘‘(A) to provide effective entrepreneurship 

5 development information, training, and tech6 nical assistance to rural regions and commu7 nities in the United States; and 

8 ‘‘(B) to enhance the effectiveness of orga9 nizations that provide direct technical assist10 ance and training services to rural entre11 preneurs. 

12 ‘‘(4) MANAGEMENT ACTIVITIES AND RE13 PORTS.—Of the amount transferred to the Center 

14 under paragraph (1), the Center shall use 

15 $1,000,000 for each fiscal year— 

16 ‘‘(A) to enhance and sustain the capacity 

17 and ability of the Center to direct and manage 

18 the programs and activities described in para19 graphs (1), (2), and (3); and 

20 ‘‘(B) to submit— 

21 ‘‘(i) to the National Board, an annual 

22 report that describes those programs and 

23 activities carried out during the year cov24 ered by the report; and 


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1 ‘‘(ii) to the Secretary, an annual re2 port that describes the state of entrepre3 neurship in the United States during the 

4 year covered by the report. 

5 ‘‘(5) AVAILABILITY OF FUNDS; CONTRACTS.— 

6 ‘‘(A) AVAILABILITY OF FUNDS.—Funds 

7 made available under this subsection shall re8 main available until expended, including for any 

9 purpose under this section. 

10 ‘‘(B) CONTRACTS.—Each contract entered 

11 into by the Center and an individual or entity 

12 shall be based on the performance of the indi13 vidual or entity. 

14 ‘‘(f) FUNDING.—Of funds made available under sec15 tion 385E(b)(3), for each of fiscal years 2008 through 

16 2012, the Secretary shall use to carry out this section 

17 $40,000,000, to remain available until expended.’’. 

18 TITLE IV—REGIONAL SKILLS 

19 ALLIANCES 

20 SEC. 401. FINDINGS. 

21 Congress finds that— 

22 (1) many small businesses lack the financial ca23 pacity to support the training of high-skilled work24 ers; 


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1 (2) many high-tech companies concerned about 

2 worker training consider recruiting employees from 

3 overseas because a shortage of information tech4 nology workers remains a significant problem; 

5 (3) too many highly educated workers in under6 served communities do not have the specialized skills 

7 needed to meet the needs of local businesses; and 

8 (4) regional skills alliances bring businesses and 

9 4-year colleges and universities and community col10 leges together to help develop and implement effec11 tive programs to make sure workers have the train12 ing needed to compete in the modern workplace. 

13 SEC. 402. DEFINITION OF SECRETARY. 

14 In this title, the term ‘‘Secretary’’ means the Sec15 retary of Labor. 

16 Subtitle A—Skill Grants 

17 SEC. 411. AUTHORIZATION. 

18 (a) IN GENERAL.—The Secretary, in consultation 

19 with the Secretary of Commerce, shall award grants to 

20 eligible entities described in subsection (b) to assist the 

21 entities to improve the job skills necessary for employment 

22 in specific industries. 

23 (b) ELIGIBLE ENTITIES DESCRIBED.— 

24 (1) IN GENERAL.—An eligible entity described 

25 in this subsection is a consortium that— 


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1 (A) shall consist of representatives from 

2 not less than 5 businesses, or a lesser number 

3 of businesses if such lesser number of busi4 nesses employs at least 30 percent of the em5 ployees in the industry involved in the region 

6 (or a nonprofit organization that represents 

7 such businesses); 

8 (B) may consist of representatives from— 

9 (i) labor organizations; 

10 (ii) State and local government; and 

11 (iii) educational institutions; 

12 (C) is established to serve 1 or more par13 ticular industries; and 

14 (D) is established to serve an eligible area. 

15 (2) ELIGIBLE AREA.—The term ‘‘eligible area’’ 

16 means a nonmetropolitan county that, based on in17 formation contained in the 2000 decennial census— 

18 (A) has a population that resides in areas 

19 more than 50 percent of which are classified as 

20 rural by the Secretary of Agriculture; and 

21 (B) had an average employment percent22 age change during the period of calendar years 

23 2001 through 2004 that was less than the na24 tional average employment percentage change 


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1 (as determined by the Bureau of Economic 

2 Analysis). 

3 (3) MAJORITY OF REPRESENTATIVES.—A ma4 jority of the representatives comprising the consor5 tium shall be representatives described in paragraph 

6 (1)(A). 

7 (c) PRIORITY FOR SMALL BUSINESSES.—In pro8 viding grants under subsection (a), the Secretary shall 

9 give priority to an eligible entity if a majority of represent10 atives forming the entity represent small-business con11 cerns (as defined in section 3(a) of the Small Business 

12 Act (15 U.S.C. 632(a)). 

13 (d) MAXIMUM AMOUNT OF GRANT.—The amount of 

14 a grant awarded to an eligible entity under subsection (a) 

15 may not exceed $1,000,000 for any fiscal year. 

16 SEC. 412. USE OF AMOUNTS. 

17 (a) IN GENERAL.—The Secretary may not award a 

18 grant under section 411 to an eligible entity unless the 

19 entity agrees to use amounts received from the grant to 

20 improve the job skills necessary for employment by busi21 nesses in the industry with respect to which the entity was 

22 established. 

23 (b) CONDUCT OF PROGRAM.— 


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1 (1) IN GENERAL.—In carrying out the program 

2 described in subsection (a), the eligible entity may 

3 provide for— 

4 (A) an assessment of training and job skill 

5 needs for the industry; 

6 (B) the development of a sequence of skill 

7 standards that are benchmarked to advanced 

8 industry practices; 

9 (C) the development of curriculum and 

10 training methods, including, where appropriate, 

11 e-learning or technology-based training; 

12 (D) the purchase, lease, or receipt of dona13 tions of training equipment; 

14 (E) the identification of training providers 

15 and the development of partnerships between 

16 the industry and educational institutions, in17 cluding community colleges; 

18 (F) the development of apprenticeship pro19 grams; 

20 (G) the development of training programs 

21 for workers, including dislocated workers; 

22 (H) the development of training plans for 

23 businesses; and 

24 (I) the development of the membership of 

25 the entity. 


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1 (2) ADDITIONAL REQUIREMENT.—In carrying 

2 out the program described in subsection (a), the eli3 gible entity shall provide for the development and 

4 tracking of performance outcome measures for the 

5 program and the training providers involved in the 

6 program. 

7 (c) ADMINISTRATIVE COSTS.—The eligible entity 

8 may use not more than 10 percent of the amount of a 

9 grant to pay for administrative costs associated with the 

10 program described in subsection (a). 

11 SEC. 413. REQUIREMENT OF MATCHING FUNDS. 

12 (a) IN GENERAL.—The Secretary may not award a 

13 grant under section 411 to an eligible entity unless the 

14 entity agrees that the entity will make available non-Fed15 eral contributions toward the costs of carrying out activi16 ties under the grant in an amount that is not less than 

17 $2 for each $1 of Federal funds provided under the grant, 

18 of which— 

19 (1) $1 shall be provided by the businesses par20 ticipating in the entity; and 

21 (2) $1 shall be provided by the State or local 

22 government involved. 

23 (b) OTHER CONTRIBUTIONS.— 

24 (1) EQUIPMENT.—Equipment donations to fa25 cilities that are not owned or operated by the memVerDate Aug 31 2005 01:50 Apr 11, 2007 Jkt 059200 PO 00000 Frm 00033 Fmt 6652 Sfmt 6201 E:\BILLS\S1034.IS S1034

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1 bers of the eligible entity involved and that are 

2 shared by the members may be included in deter3 mining compliance with subsection (a). 

4 (2) LIMITATION.— 

5 (A) IN GENERAL.—An eligible entity may 

6 not include in-kind contributions in complying 

7 with the requirement of subsection (a). 

8 (B) CONSIDERATION.—The Secretary may 

9 consider donations described in subparagraph 

10 (A) in ranking applications. 

11 SEC. 414. LIMIT ON ADMINISTRATIVE EXPENSES. 

12 The Secretary may use not more than 5 percent of 

13 the amounts made available to carry out this title to pay 

14 the Federal administrative costs associated with awarding 

15 grants under this title. 

16 SEC. 415. AUTHORIZATION OF APPROPRIATIONS. 

17 There are authorized to be appropriated to carry out 

18 this subtitle— 

19 (1) $50,000,000 for each of fiscal years 2008 

20 through 2012; and 

21 (2) such sums as are necessary for each fiscal 

22 year thereafter. 


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1 Subtitle B—Planning Grants 

2 SEC. 421. AUTHORIZATION. 

3 (a) IN GENERAL.—The Secretary, in consultation 

4 with the Secretary of Commerce, shall award grants to 

5 States to enable the States to assist businesses, organiza6 tions, and agencies described in section 411(b) in con7 ducting planning to form consortia described in that sec8 tion. 

9 (b) MAXIMUM AMOUNT OF GRANT.—The amount of 

10 a grant awarded to a State under subsection (a) may not 

11 exceed $500,000 for any fiscal year. 

12 SEC. 422. APPLICATION. 

13 The Secretary may not award a grant under section 

14 421 to a State unless the State submits to the Secretary 

15 an application at such time, in such manner, and con16 taining such information as the Secretary may reasonably 

17 require. 

18 SEC. 423. REQUIREMENT OF MATCHING FUNDS. 

19 The Secretary may not award a grant under section 

20 421 to a State unless the State agrees that the State will 

21 make available non-Federal contributions toward the costs 

22 of carrying out activities under this subtitle in an amount 

23 that is not less than $1 for each $1 of Federal funds pro24 vided under the grant. 


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1 SEC. 424. AUTHORIZATION OF APPROPRIATIONS. 

2 There is authorized to be appropriated to carry out 

3 this subtitle $5,000,000 for fiscal year 2008. 

4 TITLE V—SMALL BUSINESS JOBS 

5 TAX CREDIT 

6 SEC. 501. EXPANSION OF WORK OPPORTUNITY TAX CREDIT. 

7 (a) IN GENERAL.—Section 51(d)(1) of the Internal 

8 Revenue Code of 1986 (relating to members of targeted 

9 groups) is amended by striking ‘‘or’’ at the end of sub10 paragraph (H), by striking the period at the end of sub11 paragraph (I) and inserting ‘‘, or’’, and by adding at the 

12 end the following: 

13 ‘‘(J) a qualified small business employee.’’. 

14 (b) QUALIFIED SMALL BUSINESS EMPLOYEE.—Sec15 tion 51(d) of the Internal Revenue Code of 1986 is amend16 ed by redesignating paragraphs (11) through (13) as para17 graphs (12) through (14), respectively, and by inserting 

18 after paragraph (10) the following: 

19 ‘‘(11) QUALIFIED SMALL BUSINESS EM20 PLOYEE.— 

21 ‘‘(A) IN GENERAL.—The term ‘qualified 

22 small business employee’ means any indi23 vidual— 

24 ‘‘(i) hired by a qualified small busi25 ness located in an eligible area, or 


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1 ‘‘(ii) hired by a qualified small busi2 ness and who is certified by the designated 

3 local agency as residing in such an eligible 

4 area. 

5 ‘‘(B) QUALIFIED SMALL BUSINESS.—The 

6 term ‘qualified small business’ has the meaning 

7 given the term ‘small employer’ by section 

8 4980D(d)(2). 

9 ‘‘(C) ELIGIBLE AREA.—The term ‘eligible 

10 area’ means a nonmetropolitan county that, 

11 based on information contained in the 2000 de12 cennial census— 

13 ‘‘(i) has a population that resides in 

14 areas more than 50 percent of which are 

15 classified as rural by the Secretary of Agri16 culture; and 

17 ‘‘(ii) had an average employment per18 centage change during the period of cal19 endar years 2001 through 2004 that was 

20 less than the national average employment 

21 percentage change (as determined by the 

22 Bureau of Economic Analysis). 

23 ‘‘(D) NUMBER OF DESIGNATIONS.—The 

24 Secretary, after consultation with the Secretary 

25 of Housing and Urban Development and the 


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1 Secretary of Agriculture, may not designate 

2 more than 400 eligible areas. 

3 ‘‘(E) SPECIAL RULES FOR DETERMINING

4 AMOUNT OF CREDIT.—For purposes of applying 

5 this subpart to wages paid or incurred to any 

6 qualified small business employee— 

7 ‘‘(i) subsection (a) shall be applied by 

8 substituting ‘20 percent of the qualified 

9 first, second, third, fourth, or fifth year 

10 wages’ for ‘40 percent of the qualified first 

11 year wages’, and 

12 ‘‘(ii) in lieu of paragraphs (2) and (3) 

13 of subsection (b), the following definitions 

14 and special rule shall apply: 

15 ‘‘(I) QUALIFIED FIRST-YEAR

16 WAGES.—The term ‘qualified first17 year wages’ means, with respect to 

18 any individual, qualified wages attrib19 utable to service rendered during the 

20 1-year period beginning with the day 

21 the individual begins work for the em22 ployer. 

23 ‘‘(II) QUALIFIED SECOND-YEAR

24 WAGES.—The term ‘qualified second25 year wages’ means, with respect to 


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1 any individual, qualified wages attrib2 utable to service rendered during the 

3 1-year period beginning on the day 

4 after the last day of the 1-year period 

5 with respect to such individual deter6 mined under subclause (I). 

7 ‘‘(III) QUALIFIED THIRD-YEAR

8 WAGES.—The term ‘qualified third9 year wages’ means, with respect to 

10 any individual, qualified wages attrib11 utable to service rendered during the 

12 1-year period beginning on the day 

13 after the last day of the 1-year period 

14 with respect to such individual deter15 mined under subclause (II). 

16 ‘‘(IV) QUALIFIED FOURTH-YEAR

17 WAGES.—The term ‘qualified fourth18 year wages’ means, with respect to 

19 any individual, qualified wages attrib20 utable to service rendered during the 

21 1-year period beginning on the day 

22 after the last day of the 1-year period 

23 with respect to such individual deter24 mined under subclause (III). 


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1 ‘‘(V) QUALIFIED FIFTH-YEAR

2 WAGES.—The term ‘qualified fifth3 year wages’ means, with respect to 

4 any individual, qualified wages attrib5 utable to service rendered during the 

6 1-year period beginning on the day 

7 after the last day of the 1-year period 

8 with respect to such individual deter9 mined under subclause (IV). 

10 ‘‘(VI) ONLY FIRST $15,000 OF

11 WAGES PER YEAR TAKEN INTO AC12 COUNT.—The amount of the qualified 

13 first, second, third, fourth, and fifth 

14 year wages which may be taken into 

15 account with respect to any individual 

16 shall not exceed $15,000 per year.’’. 

17 (c) EFFECTIVE DATE.—The amendments made by 

18 this section shall apply to individuals who begin work for 

19 the employer after the date of the enactment of this Act. 

Æ 


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