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103D CONGRESS

1ST SESSION H. R. 2191

To authorize the Secretary of Housing and Urban Development to carry

out a demonstration program to make grants to community development

corporations for reducing interest rates on loans for economic development activities in 5 federally designated enterprise zones.

IN THE HOUSE OF REPRESENTATIVES

MAY 19, 1993

Mr. TRAFICANT (for himself, Mr. APPLEGATE, Mr. FRANK of Massachusetts,

Mr. MCCLOSKEY, Mr. STRICKLAND, Mr. FILNER, and Mr. BLACKWELL)

introduced the following bill; which was referred to the Committee on

Banking, Finance and Urban Affairs

A BILL

To authorize the Secretary of Housing and Urban Development to carry out a demonstration program to make

grants to community development corporations for reducing interest rates on loans for economic development

activities in 5 federally designated enterprise zones.

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.

4 This Act may be cited as the ‘‘Economic Development

5 Loan Assistance Demonstration Program Act of 1993’’.
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1 SEC. 2. ESTABLISHMENT AND SCOPE OF DEMONSTRATION

2 PROGRAM.

3 (a) ESTABLISHMENT.—The Secretary of Housing

4 and Urban Development shall carry out a program to

5 demonstrate the effectiveness of encouraging economic de6 velopment in enterprise zones by making grants to com7 munity development corporations for reducing interest

8 rates on loans for economic development activities in the

9 enterprise zones.

10 (b) SELECTION OF ENTERPRISE ZONES.—

11 (1) NUMBER.—The Secretary shall carry out

12 the demonstration program under this Act with re13 spect to 5 enterprise zones, which the Secretary

14 shall select not later than the expiration of the 30-

15 day period beginning on the date the termination of

16 the period referred to in section 701(a)(4)(B) of the

17 Housing and Community Development Act of 1987.

18 (2) DIVERSITY.—Of the enterprise zones se19 lected under this subsection, not less than 2 shall be

20 located in rural areas (as described in section

21 701(a)(2)(B) of the Housing and Community Devel22 opment Act of 1987) and not less than 2 shall be

23 located in metropolitan statistical areas (as des24 ignated by the Director of the Office of Management

25 and Budget). In selecting the enterprise zones, the

26 Secretary shall provide for national geographic diver-
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1 sity among enterprise zones participating in the

2 demonstration program.

3 SEC. 3. GRANTS FOR ECONOMIC DEVELOPMENT LOAN AS4 SISTANCE.

5 (a) AUTHORITY.—Under the demonstration program

6 under this Act, the Secretary may make grants to any

7 community development corporation sponsored by a bank

8 or thrift institution, by a nonbank economic development

9 corporation, or by residents of an enterprise zone selected

10 under section 2(b).

11 (b) USE.—Each community development corporation

12 receiving a grant under the demonstration program under

13 this Act shall use the grant amounts to assist businesses

14 and nonprofit organizations by reducing interest rates on

15 loans for economic development activities carried out in

16 an enterprise zone selected under section 2(b).

17 (c) OTHER REQUIREMENTS.—The Secretary shall re18 quire each community development corporation receiving

19 a grant under the demonstration program under this Act

20 to—

21 (1) use the grant amounts to reduce the inter22 est rate on a loan described in subsection (b) by an

23 amount not to exceed 60 percent of the market rate

24 of interest on such loan; and
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1 (2) take any actions necessary to inform busi2 nesses and nonprofit organizations of the availability

3 of such loans, including holding informational meet4 ings, making public announcements, and placing no5 tices in newspapers and other publications.

6 SEC. 4. MONITORING.

7 The Secretary shall monitor the use of grants made

8 under this Act and the costs of administering such grants.

9 SEC. 5. REPORTS AND STUDY.

10 (a) ANNUAL REPORT.—The Secretary shall submit

11 to the Congress, not later than 1 year after the date that

12 amounts to carry out this Act are first made available

13 under appropriations Acts and for each year thereafter in

14 which amounts are available to carry out the demonstra15 tion program, a report containing an evaluation of the

16 effectiveness of grants made under the demonstration

17 program.

18 (b) STUDY AND REPORT ON EXPANDED PROGRAM.—

19 (1) STUDY.—The Secretary shall conduct a

20 study regarding the effects and costs of carrying out

21 a long-term and expanded program of making grants

22 for the purposes under this Act. The study shall de23 termine the need for such grants and the amount of

24 funds necessary to carry out an effective program of

25 national scope.
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1 (2) REPORT.—The Secretary shall submit to

2 the Congress, not later than September 31, 1996, a

3 report regarding the results of the study under para4 graph (1) and any recommendations for carrying out

5 a program as described in paragraph (1).

6 SEC. 6. DEFINITIONS.

7 For the purposes of this Act:

8 (1) ECONOMIC DEVELOPMENT ACTIVITIES.—

9 The term ‘‘economic development activities’’ means

10 the construction and rehabilitation of housing, down11 town and neighborhood commercial revitalization, in12 dustrial development and redevelopment, small and

13 minority business assistance, neighborhood market14 ing, training, and technical assistance, research and

15 planning for nonprofit development groups, and

16 other activities which create permanent private sec17 tor jobs.

18 (2) ENTERPRISE ZONE.—The term ‘‘enterprise

19 zone’’ means an area that is designated as an enter20 prise zone under section 701 of the Housing and

21 Community Development Act of 1987.

22 (3) SECRETARY.—The term ‘‘Secretary’’ means

23 the Secretary of Housing and Urban Development.
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1 SEC. 7. AUTHORIZATION OF APPROPRIATIONS.

2 There is authorized to be appropriated to carry out

3 this Act in fiscal years 1994, 1995, and 1996 a total of

4 $100,000,000.

5 SEC. 8. REGULATIONS.

6 The Secretary may issue any regulations necessary

7 to carry out this Act.

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