national border between the United States and Mex-
ico. 
(4) BUSINESS INCUBATOR SERVICE.—The term 
‘‘business incubator service’’ means— 
(A) a legal service, including aid in pre-
paring a corporate charter, partnership agree-
ment, or contract; 
(B) a service in support of the protection 
of intellectual property through a patent, a 
trademark, or any other means; 
(C) a service in support of the acquisition 
or use of advanced technology, including the 
use of Internet services and Web-based services; 
and 
(D) consultation on strategic planning, 
marketing, or advertising. 
(5) COMPETITIVE
COUNTY.—The term ‘‘com-
petitive county’’ means an economically strong coun-
ty that meets at least 1, but not all, of the criteria 
for a distressed county specified in paragraph (5). 
(6) DISTRESSED
COUNTY.—The term ‘‘dis-
tressed county’’ means a county in the region that— 
(A)(i) has a poverty rate that is at least 
150 percent of the poverty rate of the United 
States; 
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(ii) has a per capita market income that is 
not more than 67 percent of the per capita 
market income of the United States; and 
(iii) has a 3-year unemployment rate that 
is at least 150 percent of the unemployment 
rate of the United States; or 
(B)(i) has a poverty rate that is at least 
200 percent of the poverty rate of the United 
States; and 
(ii)(I) has a per capita market income that 
is not more than 67 percent of the per capita 
market income of the United States; or 
(II) has a 3-year unemployment rate that 
is at least 150 percent of the unemployment 
rate of the United States. 
(7) ECONOMICALLY
STRONG
COUNTY.—The 
term ‘‘economically strong county’’ means a county 
in the region that is not a distressed county. 
(8) FEDERAL
GRANT
PROGRAM.—The term 
‘‘Federal grant program’’ means a Federal grant 
program to provide assistance in— 
(A) acquiring or developing land; 
(B) constructing or equipping a highway, 
road, bridge, or facility; or 
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(C) carrying out other economic develop-
ment activities. 
(9) INDIAN TRIBE.—The term ‘‘Indian tribe’’ 
has the meaning given the term in section 4 of the 
Indian Self-Determination and Education Assistance 
Act (25 U.S.C. 450b). 
(10) ISOLATED AREA OF DISTRESS.—The term 
‘‘isolated area of distress’’ means an area located in 
an economically strong county that has a high rate 
of poverty, unemployment, or outmigration, as deter-
mined by the Authority. 
(11) LOCAL
DEVELOPMENT
DISTRICT.—The 
term ‘‘local development district’’ means an entity 
that— 
(A)(i) is an economic development district 
that is— 
(I) in existence on the date of enact-
ment of this Act; and 
(II) recognized by the Economic De-
velopment Administration; and 
(III) located in the region; or 
(ii) if an entity described in clause (i) does 
not exist— 
(I) is organized and operated in a 
manner that ensures broad-based commu-
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nity participation and an effective oppor-
tunity for local officials, community lead-
ers, and the public to contribute to the de-
velopment and implementation of programs 
in the region; 
(II) is governed by a policy board with 
at least a simple majority of members con-
sisting of designees or employees of a gen-
eral purpose unit of local government that 
have been appointed to represent the unit 
of local government or elected officials; and 
(III) is certified by the Governor or 
appropriate State officer as having a char-
ter or authority that includes the economic 
development of counties, portions of coun-
ties, or other political subdivisions within 
the region; and 
(B) has not, as certified by the Federal co-
chairperson— 
(i) inappropriately used Federal grant 
funds from any Federal source; or 
(ii) appointed an officer who, during 
the period in which another entity inappro-
priately used Federal grant funds from any 
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Federal source, was an officer of the other 
entity. 
(12) REGION.—The term ‘‘region’’ means— 
(A) the counties of Cochise, Gila, Graham, 
Greenlee, La Paz, Maricopa, Pima, Pinal, 
Santa Cruz, and Yuma in the State of Arizona; 
(B) the counties of Imperial, Los Angeles, 
Orange, Riverside, San Bernardino, San Diego, 
and Ventura in the State of California; 
(C) the counties of Catron, Chaves, Don˜a 
Ana, Eddy, Grant, Hidalgo, Lincoln, Luna, 
Otero, Sierra, and Socorro in the State of New 
Mexico; and 
(D) the counties of Atascosa, Bandera, 
Bee, Bexar, Brewster, Brooks, Cameron, Coke, 
Concho, Crane, Crockett, Culberson, Dimmit, 
Duval, Ector, Edwards, El Paso, Frio, Gil-
lespie, Glasscock, Hidalgo, Hudspeth, Irion, 
Jeff Davis, Jim Hogg, Jim Wells, Karnes, Ken-
dall, Kenedy, Kerr, Kimble, Kinney, Kleberg, 
La Salle, Live Oak, Loving, Mason, Maverick, 
McMullen, Medina, Menard, Midland, Nueces, 
Pecos, Presidio, Reagan, Real, Reeves, San 
Patricio, Shleicher, Sutton, Starr, Sterling, 
Terrell, Tom Green, Upton, Uvalde, Val Verde, 
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Ward, Webb, Willacy, Wilson, Winkler, Zapata, 
and Zavala in the State of Texas. 
(13) SMALL BUSINESS.—The term ‘‘small busi-
ness’’ has the meaning given the term ‘‘small busi-
ness concern’’ in section 3(a) of the Small Business 
Act (15 U.S.C. 632(a)). 
TITLE I—SOUTHWEST REGIONAL 
BORDER AUTHORITY 
SEC. 101. MEMBERSHIP AND VOTING. 
(a) ESTABLISHMENT.— 
(1) IN
GENERAL.—There is established the 
Southwest Regional Border Authority. 
(2) COMPOSITION.—The Authority shall be 
composed of— 
(A) a Federal member, to be appointed by 
the President, by and with the advice and con-
sent of the Senate; and 
(B) State members, who shall consist of 
the Governor (or a designee of the Governor) of 
each State in the region that elects to partici-
pate in the Authority. 
(3) COCHAIRPERSONS.—The Authority shall be 
headed by— 
(A) the Federal member, who shall serve— 
(i) as the Federal cochairperson; and 
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(ii) as a liaison between the Federal 
Government and the Authority; and 
(B) a State cochairperson, who shall— 
(i) be a Governor of a State described 
in paragraph (2)(B); 
(ii) be elected by the State members 
for a term of not more than 2 years; and 
(iii) serve only 1 term during any 4 
year period. 
(b) ALTERNATE MEMBERS.— 
(1) STATE ALTERNATES.—The State member 
of a State described in paragraph (2)(B) may have 
a single alternate, who shall be— 
(A) a resident of that State; and 
(B) appointed by the Governor of the 
State, from among the members of the cabinet 
or personal staff of the Governor. 
(2) ALTERNATE FEDERAL COCHAIRPERSON.— 
The President shall appoint an alternate Federal co-
chairperson. 
(3) QUORUM.—Subject to subsection (d)(4), a 
State alternate member shall not be counted toward 
the establishment of a quorum of the members of 
the Authority in any case in which a quorum of the 
State members is required to be present. 
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(4) DELEGATION OF POWER.—No power or re-
sponsibility of the Authority specified in paragraph 
(2) or (3) of subsection (d), and no voting right of 
any member of the Authority, shall be delegated to 
any person who is not— 
(A) a member of the Authority; or 
(B) entitled to vote at meetings of the Au-
thority. 
(c) MEETINGS.— 
(1) INITIAL MEETING.—The initial meeting of 
the Authority shall be conducted not later than the 
date that is the earlier of— 
(A) 180 days after the date of enactment 
of this Act; or 
(B) 60 days after the date on which the 
Federal cochairperson is appointed. 
(2) OTHER
MEETINGS.—The Authority shall 
hold meetings at such times as the Authority deter-
mines, but not less often than semiannually. 
(3) LOCATION.—Meetings of the Authority shall 
be conducted, on a rotating basis, at a site in the 
region in each of the States of Arizona, California, 
New Mexico, and Texas. 
(d) VOTING.— 
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(1) IN GENERAL.—To be effective, a decision by 
the Authority shall require the approval of the Fed-
eral cochairperson and not less than 60 percent of 
the State members of the Authority (not including 
any member representing a State that is delinquent 
under section 102(d)(2)(D)). 
(2) QUORUM.— 
(A) IN GENERAL.—A majority of the State 
members shall constitute a quorum. 
(B) REQUIRED FOR POLICY DECISION.—A 
quorum of State members shall be required to 
be present for the Authority to make any policy 
decision, including— 
(i) a modification or revision of a pol-
icy decision of the Authority; 
(ii) approval of a State or regional de-
velopment plan; and 
(iii) any allocation of funds among the 
States. 
(3) PROJECT AND GRANT PROPOSALS.—The ap-
proval of project and grant proposals shall be— 
(A) a responsibility of the Authority; and 
(B) conducted in accordance with section 
302. 
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(4) VOTING BY ALTERNATE MEMBERS.—An al-
ternate member shall vote in the case of the absence, 
death, disability, removal, or resignation of the Fed-
eral or State member for which the alternate mem-
ber is an alternate. 
SEC. 102. DUTIES AND POWERS. 
(a) DUTIES.—The Authority shall— 
(1) develop comprehensive and coordinated 
plans and programs to establish priorities and ap-
prove grants for the economic development of the re-
gion, giving due consideration to other Federal, 
State, and local planning and development activities 
in the region; 
(2) conduct and sponsor investigations, re-
search, and studies, including an inventory and anal-
ysis of the resources of the region, using, in part, 
the materials compiled by the Interagency Task 
Force on the Economic Development of the South-
west Border established by Executive Order No. 
13122 (64 Fed. Reg. 29201); 
(3) sponsor demonstration projects under sec-
tion 207; 
(4)(A) enhance the capacity of, and provide 
support for, local development districts in the region; 
or 
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(B) if there is no local development district de-
scribed in clause (i) of section 3(11)(A) for a portion 
of the region, foster the creation of a local develop-
ment district; 
(5) review and study Federal, State, and local 
public and private programs and, as appropriate, 
recommend modifications or additions to increase 
the effectiveness of the programs; 
(6) formulate and recommend, as appropriate, 
interstate and international compacts and other 
forms of interstate and international cooperation; 
(7) encourage private investment in industrial, 
commercial, and recreational projects in the region; 
(8) provide a forum for consideration of the 
problems of the region and any proposed solutions to 
those problems; 
(9) establish and use, as appropriate, citizens, 
special advisory counsels, and public conferences; 
and 
(10) provide a coordinating mechanism to avoid 
duplication of efforts among the border programs of 
the Federal agencies and the programs established 
under the North American Free Trade Agreement 
entered into by the United States, Mexico, and Can-
ada on December 17, 1992. 
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(b) POWERS.—In carrying out subsection (a), the Au-
thority may— 
(1) hold such hearings, sit and act at such 
times and places, take such testimony, receive such 
evidence, and print or otherwise reproduce and dis-
tribute a description of the proceedings of, and re-
ports on actions by, the Authority as the Authority 
considers appropriate; 
(2) request from any Federal, State, or local 
agency such information as may be available to or 
procurable by the agency that may be of use to the 
Authority in carrying out the duties of the Author-
ity; 
(3) maintain an accurate and complete record 
of all transactions and activities of the Authority, to 
be available for audit and examination by the Comp-
troller General of the United States; 
(4) adopt, amend, and repeal bylaws and rules 
governing the conduct of business and the perform-
ance of duties of the Authority; 
(5) request the head of any Federal agency to 
detail to the Authority, for a specified period of 
time, such personnel as the Authority requires to 
carry out duties of the Authority, each such detail 
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to be without loss of seniority, pay, or other em-
ployee status; 
(6) request the head of any State department 
or agency or local government to detail to the Au-
thority, for a specified period of time, such personnel 
as the Authority requires to carry out the duties of 
the Authority, each such detail to be without loss of 
seniority, pay, or other employee status; 
(7) make recommendations to the President re-
garding— 
(A) the expenditure of funds at the Fed-
eral, State, and local levels under this Act; and 
(B) additional Federal, State, and local 
legislation that may be necessary to further the 
purposes of this Act; 
(8) provide for coverage of Authority employees 
in a suitable retirement and employee benefit system 
by— 
(A) making arrangements or entering into 
contracts with any participating State govern-
ment; or 
(B) otherwise providing retirement and 
other employee benefit coverage; 
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(9) accept, use, and dispose of gifts or dona-
tions of services or real, personal, tangible, or intan-
gible property; 
(10) enter into and perform such contracts, 
leases, cooperative agreements, or other transactions 
as are necessary to carry out the duties of the Au-
thority; 
(11) establish and maintain— 
(A) a headquarters for the Authority, to be 
located at a site that is not more than 100 kilo-
meters from the international border between 
the United States and Mexico; and 
(B) at least 1 field office in each of the 
States of Arizona, California, New Mexico, and 
Texas, to be located at appropriate sites in the 
region that are not more than 100 kilometers 
from the international border between the 
United States and Mexico; and 
(12) provide for an appropriate level of rep-
resentation in Washington, D.C. 
(c) FEDERAL AGENCY COOPERATION.—A Federal 
agency shall— 
(1) cooperate with the Authority; and 
(2) provide, on request of the Federal cochair-
person, appropriate assistance in carrying out this 
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Act, in accordance with applicable Federal laws (in-
cluding regulations). 
(d) ADMINISTRATIVE EXPENSES.— 
(1) IN GENERAL.— 
(A) ADMINISTRATIVE EXPENSES.—Subject 
to paragraph (2), administrative expenses of the 
Authority shall be paid— 
(i) by the Federal Government, in an 
amount equal to 60 percent of the admin-
istrative expenses; and 
(ii) by the States in the region that 
elect to participate in the Authority, in an 
amount equal to 40 percent of the admin-
istrative expenses. 
(B) 
EXPENSES
OF
FEDERAL
CHAIR-
PERSON.—All expenses of the Federal cochair-
person, including expenses of the alternate and 
staff of the Federal cochairperson, shall be paid 
by the Federal Government. 
(2) STATE SHARE.— 
(A) IN
GENERAL.—Subject to subpara-
graph (C), the share of administrative expenses 
of the Authority to be paid by each State shall 
be determined by a unanimous vote of the State 
members of the Authority. 
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(B) NO
FEDERAL
PARTICIPATION.—The 
Federal cochairperson shall not participate or 
vote in any decision under subparagraph (A). 
(C) LIMITATION.—A State shall not pay 
less than 10 nor more than 40 percent of the 
share of administrative expenses of the Author-
ity determined under paragraph (1)(A)(ii). 
(D) DELINQUENT
STATES.—During any 
period in which a State is more than 1 year de-
linquent in payment of the State’s share of ad-
ministrative expenses of the Authority under 
this subsection (as determined by the Sec-
retary)— 
(i) no assistance under this Act shall 
be provided to the State (including assist-
ance to a political subdivision or a resident 
of the State) for any project not approved 
as of the date of the commencement of the 
delinquency; and 
(ii) no member of the Authority from 
the State shall participate or vote in any 
action by the Authority. 
(E) EFFECT ON ASSISTANCE.—A State’s 
share of administrative expenses of the Author-
ity under this subsection shall not be taken into 
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consideration in determining the amount of as-
sistance provided to the State under title II. 
SEC. 103. AUTHORITY PERSONNEL MATTERS. 
(a) COMPENSATION OF MEMBERS.— 
(1) FEDERAL
COCHAIRPERSON.—The Federal 
cochairperson shall be compensated by the Federal 
Government at the annual rate of basic pay pre-
scribed for level III of the Executive Schedule in 
subchapter II of chapter 53 of title 5, United States 
Code. 
(2) ALTERNATE FEDERAL COCHAIRPERSON.— 
The alternate Federal cochairperson— 
(A) shall be compensated by the Federal 
Government at the annual rate of basic pay 
prescribed for level V of the Executive Schedule 
described in paragraph (1); and 
(B) when not actively serving as an alter-
nate for the Federal cochairperson, shall per-
form such functions and duties as are delegated 
by the Federal cochairperson. 
(3) STATE MEMBERS AND ALTERNATES.— 
(A) IN
GENERAL.—A State shall com-
pensate each member and alternate member 
representing the State on the Authority at the 
rate established by State law. 
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(B) NO ADDITIONAL COMPENSATION.—No 
State member or alternate member shall receive 
any salary, or any contribution to or sup-
plementation of salary, from any source other 
than the State for services provided by the 
member or alternate member to the Authority. 
(b) DETAILED EMPLOYEES.— 
(1) IN GENERAL.—No person detailed to serve 
the Authority under section 102(b)(6) shall receive 
any salary, or any contribution to or supplemen-
tation of salary, for services provided to the Author-
ity from— 
(A) any source other than the State, local, 
or intergovernmental department or agency 
from which the person was detailed; or 
(B) the Authority. 
(2) VIOLATION.—Any person that violates this 
subsection shall be fined not more than $5,000, im-
prisoned not more than 1 year, or both. 
(c) ADDITIONAL PERSONNEL.— 
(1) COMPENSATION.— 
(A) IN GENERAL.—The Authority may ap-
point and fix the compensation of an executive 
director and such other personnel as are nec-
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essary to enable the Authority to carry out the 
duties of the Authority. 
(B) 
EXCEPTION.—Compensation 
under 
subparagraph (A) shall not exceed the max-
imum rate of basic pay established for the Sen-
ior Executive Service under section 5382 of title 
5, United States Code, including any applicable 
locality-based comparability payment that may 
be authorized under section 5304(h)(2)(C) of 
that title. 
(2) EXECUTIVE DIRECTOR.—The executive di-
rector shall be responsible for— 
(A) carrying out the administrative duties 
of the Authority; 
(B) directing the Authority staff; and 
(C) carrying out such other duties as the 
Authority may assign. 
(3) NO
FEDERAL
EMPLOYEE
STATUS.—No 
member, alternate, officer, or employee of the Au-
thority (other than the Federal cochairperson, the 
alternate Federal cochairperson, staff of the Federal 
cochairperson, and any Federal employee detailed to 
the Authority under subsection (b)) shall be consid-
ered to be a Federal employee for any purpose. 
(d) CONFLICTS OF INTEREST.— 
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(1) IN GENERAL.—Except as provided under 
paragraph (2), no State member, State alternate, of-
ficer, employee, or detailee of the Authority shall 
participate personally and substantially as a mem-
ber, alternate, officer, employee, or detailee of the 
Authority, through decision, approval, disapproval, 
recommendation, the rendering of advice, investiga-
tion, or otherwise, in any proceeding, application, re-
quest for a ruling or other determination, contract, 
claim, controversy, or other matter in which the 
member, alternate, officer, employee, or detailee has 
a financial interest. 
(2) DISCLOSURE.—Paragraph (1) shall not 
apply if the State member, State alternate, officer, 
employee, or detailee— 
(A) immediately advises the Authority of 
the nature and circumstances of the proceeding, 
application, request for a ruling or other deter-
mination, contract, claim, controversy, or other 
particular matter presenting a potential conflict 
of interest; 
(B) makes full disclosure of the financial 
interest; and 
(C) before the proceeding concerning the 
matter presenting the conflict of interest, re-
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ceives a written determination by the Authority 
that the interest is not so substantial as to be 
likely to affect the integrity of the services that 
the Authority may expect from the State mem-
ber, State alternate, officer, employee, or 
detailee. 
(3) VIOLATION.—Any person that violates this 
subsection shall be fined not more than $10,000, im-
prisoned not more than 2 years, or both. 
(e) 
VALIDITY
OF
CONTRACTS, 
LOANS, 
AND 
GRANTS.—The Authority may declare void any contract, 
loan, or grant of or by the Authority in relation to which 
the Authority determines that there has been a violation 
of subsection (b), subsection (d), or any of sections 202 
through 209 of title 18, United States Code. 
(f) APPLICABLE LABOR STANDARDS.— 
(1) IN GENERAL.—All laborers and mechanics 
employed by contractors or subcontractors in the 
construction, alteration, or repair, including painting 
and decorating, of projects, buildings, and works 
funded by the United States under this Act, shall be 
paid wages at not less than the prevailing wages on 
similar construction in the locality as determined by 
the Secretary of Labor in accordance with sections 
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3141–3144, 3146, and 3147 of title 40, United 
States Code. 
(2) AUTHORITY.—With respect to the deter-
mination of wages under paragraph (1), the Sec-
retary of Labor shall have the authority and func-
tions set forth in Reorganization Plan No. 14 of 
1950 (64 Stat. 1267) and section 3145 of title 40, 
United States Code. 
TITLE II—GRANTS AND 
DEVELOPMENT PLANNING 
SEC. 201. INFRASTRUCTURE DEVELOPMENT AND IMPROVE-
MENT. 
The Authority may approve grants to States, local 
governments, Indian tribes, and public and nonprofit orga-
nizations in the region for projects, approved in accord-
ance with section 302, to develop and improve the trans-
portation, water and wastewater, public health, and tele-
communications infrastructure of the region. 
SEC. 202. TECHNOLOGY DEVELOPMENT AND DEPLOYMENT. 
The Authority may approve grants to small busi-
nesses, universities, national laboratories, and nonprofit 
organizations in the region to research, develop, dem-
onstrate, and deploy technology that addresses— 
(1) water quality; 
(2) water quantity; 
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(3) pollution; 
(4) transportation; 
(5) energy consumption; 
(6) public health; 
(7) border and port security; and 
(8) any other related matter that stimulates job 
creation or enhances economic development in the 
region, as determined by the Authority. 
SEC. 203. COMMUNITY DEVELOPMENT AND ENTREPRE-
NEURSHIP. 
The Authority may approve grants to States, local 
governments, Indian tribes, small businesses, and public 
or nonprofit entities for projects, approved in accordance 
with section 302— 
(1) to create dynamic local economies by— 
(A) recruiting businesses to the region; 
and 
(B) increasing and expanding international 
trade to other countries; 
(2) to foster entrepreneurship by— 
(A) supporting the advancement of, and 
providing entrepreneurial training and edu-
cation 
for, 
youths, 
students, 
and 
businesspersons; 
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(B) improving access to debt and equity 
capital by facilitating the establishment of de-
velopment venture capital funds and other ap-
propriate means; 
(C) providing aid to communities in identi-
fying, developing, and implementing develop-
ment strategies for various sectors of the econ-
omy; and 
(D)(i) developing a working network of 
business incubators; and 
(ii) supporting entities that provide busi-
ness incubator services; and 
(3) to promote civic responsibility and leader-
ship through activities that include— 
(A) the identification and training of 
emerging leaders; 
(B) the encouragement of citizen participa-
tion; and 
(C) the provision of assistance for strategic 
planning and organization development. 
SEC. 204. EDUCATION AND WORKFORCE DEVELOPMENT. 
The Authority, in coordination with State and local 
workforce development boards, may approve grants to 
States, local governments, Indian tribes, small businesses, 
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and public or nonprofit entities for projects, approved in 
accordance with section 302— 
(1) to assist the region in obtaining the job 
training, employment-related education, and busi-
ness development (with an emphasis on entrepre-
neurship) that are needed to build and maintain 
strong local economies; and 
(2) to supplement in-plant training programs 
offered by State and local governments to attract 
new businesses to the region. 
SEC. 205. FUNDING. 
(a) IN GENERAL.—Funds for grants under sections 
201 through 204 may be provided— 
(1) entirely from appropriations to carry out 
this Act; 
(2) in combination with funds available under 
another Federal grant program or other Federal 
program; or 
(3) in combination with funds from any other 
source, including— 
(A) State and local governments, nonprofit 
organizations, and the private sector in the 
United States; 
(B) the federal and local government of, 
and private sector in, Mexico; and 
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(C) the North American Development 
Bank. 
(b) PRIORITY OF FUNDING.— 
(1) IN GENERAL.—Subject to paragraph (2), 
the Authority shall award funding to each State in 
the region for activities in accordance with an order 
of priority to be determined by the State. 
(2) FUNDING
FOR
BORDER
COUNTIES.—For 
each fiscal year, the Authority shall allocate at least 
60 percent of the amounts made available under sec-
tion 306 for programs and projects designed to serve 
the needs of— 
(A) distressed counties located along the 
international border between the United States 
and Mexico; and 
(B) isolated areas of distress located with-
in counties along the international border be-
tween the United States and Mexico. 
(c) BINATIONAL PROJECTS.— 
(1) PROHIBITION ON PROVISION OF FUNDING 
TO NON-UNITED STATES ENTITIES.—The Authority 
shall not award funding to any entity that is not in-
corporated in the United States. 
(2) FUNDING OF BINATIONAL PROJECTS.—The 
Authority may award funding to a project in which 
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an entity that is incorporated outside the United 
States participates if, for any fiscal year, the entity 
matches with an equal amount, in cash or in-kind, 
the assistance received under this Act for the fiscal 
year. 
SEC. 206. SUPPLEMENTS TO FEDERAL GRANT PROGRAMS. 
(a) FINDING.—Congress finds that certain States 
and local communities of the region, including local devel-
opment districts, may be unable to take maximum advan-
tage of Federal grant programs for which the States and 
communities are eligible because— 
(1) they lack the economic resources to provide 
the required matching share; or 
(2) there are insufficient funds available under 
the Federal law authorizing the Federal grant pro-
gram to meet pressing needs of the region. 
(b) FEDERAL GRANT PROGRAM FUNDING.—Not-
withstanding any provision of law limiting the Federal 
share, the areas eligible for assistance, or the authoriza-
tions of appropriations, under any Federal grant program, 
and in accordance with subsection (c), the Authority, with 
the approval of the Federal cochairperson and with respect 
to a project to be carried out in the region, may— 
(1) increase the Federal share of the costs of a 
project under any Federal grant program to not 
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more than 90 percent (except as provided in section 
209(b)); and 
(2) use amounts made available to carry out 
this Act to pay all or a portion of the increased Fed-
eral share. 
(c) CERTIFICATIONS.— 
(1) IN GENERAL.—In the case of any project 
for which all or any portion of the basic Federal 
share of the costs of the project is proposed to be 
paid under this section, no Federal contribution 
shall be made until the Federal official admin-
istering the Federal law that authorizes the Federal 
grant program certifies that the project— 
(A) meets (except as provided in subsection 
(b)) the applicable requirements of the applica-
ble Federal grant program; and 
(B) could be approved for Federal con-
tribution under the Federal grant program if 
funds were available under the law for the 
project. 
(2) CERTIFICATION BY AUTHORITY.— 
(A) IN GENERAL.—The certifications and 
determinations required to be made by the Au-
thority for approval of projects under this Act 
in accordance with section 302— 
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(i) shall be controlling; and 
(ii) shall be accepted by the Federal 
agencies. 
(B) ACCEPTANCE BY FEDERAL COCHAIR-
PERSON.—In the case of any project described 
in paragraph (1), any finding, report, certifi-
cation, or documentation required to be sub-
mitted with respect to the project to the head 
of the department, agency, or instrumentality of 
the Federal Government responsible for the ad-
ministration of the Federal grant program 
under which the project is carried out shall be 
accepted by the Federal cochairperson. 
SEC. 207. DEMONSTRATION PROJECTS. 
(a) IN GENERAL.—For each fiscal year, the Author-
ity may approve not more than 10 demonstration projects 
to carry out activities described in sections 201 through 
204, of which not more than 3 shall be carried out in any 
1 State. 
(b) REQUIREMENTS.—A demonstration project car-
ried out under this section shall— 
(1) be carried out on a multistate or multi-
county basis; and 
(2) be developed in accordance with the regional 
development plan prepared under section 210(d). 
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SEC. 208. LOCAL DEVELOPMENT DISTRICTS; CERTIFI-
CATION AND ADMINISTRATIVE EXPENSES. 
(a) GRANTS TO LOCAL DEVELOPMENT DISTRICTS.— 
(1) IN GENERAL.—The Authority shall make 
grants to local development districts to pay the ad-
ministrative expenses of the local development dis-
tricts. 
(2) CONDITIONS FOR GRANTS.— 
(A) MAXIMUM AMOUNT.—The amount of 
any grant awarded under paragraph (1) shall 
not exceed 80 percent of the administrative ex-
penses of the local development district receiv-
ing the grant. 
(B) MAXIMUM
PERIOD.—No grant de-
scribed in paragraph (1) shall be awarded for a 
period greater than 3 years to a State agency 
certified as a local development district. 
(C) LOCAL SHARE.—The contributions of 
a local development district for administrative 
expenses may be in cash or in kind, fairly evalu-
ated, including space, equipment, and services. 
(b) DUTIES OF LOCAL DEVELOPMENT DISTRICTS.— 
A local development district shall— 
(1) operate as a lead organization serving 
multicounty areas in the region at the local level; 
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(2) assist the Authority in carrying out out-
reach activities for local governments, community 
development groups, the business community, and 
the public; 
(3) serve as a liaison between State and local 
governments, 
nonprofit 
organizations 
(including 
community-based groups and educational institu-
tions), the business community, and citizens; and 
(4) assist the individuals and entities described 
in paragraph (3) in identifying, assessing, and facili-
tating projects and programs to promote the eco-
nomic development of the region. 
SEC. 209. DISTRESSED COUNTIES AND AREAS AND ECO-
NOMICALLY STRONG COUNTIES. 
(a) DESIGNATIONS.—At the initial meeting of the 
Authority and annually thereafter, the Authority, in ac-
cordance with such criteria as the Authority may establish, 
shall designate— 
(1) distressed counties; 
(2) economically strong counties; 
(3) attainment counties; 
(4) competitive counties; and 
(5) isolated areas of distress. 
(b) DISTRESSED COUNTIES.— 
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(1) IN GENERAL.—For each fiscal year, the Au-
thority shall allocate at least 50 percent of the 
amounts made available under section 306 for pro-
grams and projects designed to serve the needs of 
distressed counties and isolated areas of distress in 
the region. 
(2) FUNDING LIMITATIONS.—The funding limi-
tations under section 206(b) shall not apply to a 
project to provide transportation or basic public 
services to residents of 1 or more distressed counties 
or isolated areas of distress in the region. 
(c) ECONOMICALLY STRONG COUNTIES.— 
(1) ATTAINMENT
COUNTIES.—Except as pro-
vided in paragraph (3), the Authority shall not pro-
vide funds for a project located in a county des-
ignated as an attainment county under subsection 
(a)(3). 
(2) COMPETITIVE COUNTIES.—Except as pro-
vided in paragraph (3), the Authority shall not pro-
vide more than 30 percent of the total cost of any 
project carried out in a county designated as a com-
petitive county under subsection (a)(2)(B). 
(3) EXCEPTIONS.— 
(A) IN
GENERAL.—The funding prohibi-
tion under paragraph (1) and the funding limi-
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tation under paragraph (2) shall not apply to 
grants to fund the administrative expenses of 
local 
development 
districts 
under 
section 
208(a). 
(B) MULTICOUNTY PROJECTS.—If the Au-
thority determines that a project could bring 
significant benefits to areas of the region out-
side an attainment or competitive county, the 
Authority may waive the application of the 
funding prohibition under paragraph (1) and 
the funding limitation under paragraph (2) 
to— 
(i) a multicounty project that includes 
participation by an attainment or competi-
tive county; or 
(ii) any other type of project. 
(4) ISOLATED AREAS OF DISTRESS.—For a des-
ignation of an isolated area of distress for assistance 
to be effective, the designation shall be supported— 
(A) by the most recent Federal data avail-
able; or 
(B) if no recent Federal data are available, 
by the most recent data available through the 
government of the State in which the isolated 
area of distress is located. 
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SEC. 210. DEVELOPMENT PLANNING PROCESS. 
(a) STATE DEVELOPMENT PLAN.—In accordance 
with policies established by the Authority, each State 
member shall submit an annual development plan for the 
area of the region represented by the State member to 
assist the Authority in determining funding priorities 
under section 205(b). 
(b) CONSULTATION WITH INTERESTED PARTIES.— 
In carrying out the development planning process (includ-
ing the selection of programs and projects for assistance), 
a State shall— 
(1) consult with— 
(A) local development districts; and 
(B) local units of government; 
(2) take into consideration the goals, objectives, 
priorities, and recommendations of the entities de-
scribed in paragraph (1); and 
(3) solicit input on and take into consideration 
the potential impact of the State development plan 
on the binational region. 
(c) PUBLIC PARTICIPATION.— 
(1) IN GENERAL.—The Authority and applica-
ble State and local development districts shall en-
courage and assist, to the maximum extent prac-
ticable, public participation in the development, revi-
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sion, and implementation of all plans and programs 
under this Act. 
(2) REGULATIONS.—The Authority shall de-
velop guidelines for providing public participation 
described in paragraph (1), including public hear-
ings. 
(d) REGIONAL DEVELOPMENT PLAN.—The Author-
ity shall prepare an annual regional development plan 
that— 
(1) is based on State development plans sub-
mitted under subsection (a); 
(2) takes into account— 
(A) the input of the private sector, aca-
demia, and nongovernmental organizations; and 
(B) the potential impact of the regional de-
velopment plan on the binational region; 
(3) establishes 5-year goals for the development 
of the region; 
(4) identifies and recommends to the States— 
(A) potential multistate or multicounty 
projects that further the goals for the region; 
and 
(B) potential development projects for the 
binational region; and 
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(5) identifies and recommends to the Authority 
for funding demonstration projects under section 
207. 
TITLE III—ADMINISTRATION 
SEC. 301. PROGRAM DEVELOPMENT CRITERIA. 
(a) IN GENERAL.—In considering programs and 
projects to be provided assistance under this Act, and in 
establishing a priority ranking of the requests for assist-
ance provided to the Authority, the Authority shall follow 
procedures that ensure, to the maximum extent prac-
ticable, consideration of— 
(1) the relationship of the project or class of 
projects to overall regional development; 
(2) the per capita income and poverty and un-
employment rates in an area; 
(3) the financial resources available to the ap-
plicants for assistance seeking to carry out the 
project, with emphasis on ensuring that projects are 
adequately financed to maximize the probability of 
successful economic development; 
(4) the socioeconomic importance of the project 
or class of projects in relation to other projects or 
classes of projects that may be in competition for 
the same funds; 
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(5) the prospects that the project for which as-
sistance is sought will improve, on a continuing rath-
er than a temporary basis, the opportunities for em-
ployment, the average level of income, or the eco-
nomic development of the area to be served by the 
project; and 
(6) the extent to which the project design pro-
vides for detailed outcome measurements by which 
grant expenditures and the results of the expendi-
tures may be evaluated. 
(b) NO RELOCATION ASSISTANCE.—No financial as-
sistance authorized by this Act shall be used to assist a 
person or entity in relocating from 1 area to another, ex-
cept that financial assistance may be used as otherwise 
authorized by this Act to attract businesses from outside 
the region to the region. 
(c) MAINTENANCE OF EFFORT.—Funds may be pro-
vided for a program or project in a State under this Act 
only if the Authority determines that the level of Federal 
or State financial assistance provided under a law other 
than this Act, for the same type of program or project 
in the same area of the State within the region, will not 
be reduced as a result of funds made available by this Act. 
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SEC. 
302. 
APPROVAL 
OF 
DEVELOPMENT 
PLANS 
AND 
PROJECTS. 
(a) IN GENERAL.—A State or regional development 
plan or any multistate subregional plan that is proposed 
for development under this Act shall be reviewed by the 
Authority. 
(b) EVALUATION BY STATE MEMBER.—An applica-
tion for a grant or any other assistance for a project under 
this Act shall be made through and evaluated for approval 
by the State member of the Authority representing the 
applicant. 
(c) CERTIFICATION.—An application for a grant or 
other assistance for a project shall be approved only on 
certification by the State member that the application for 
the project— 
(1) describes ways in which the project complies 
with any applicable State development plan; 
(2) meets applicable criteria under section 301; 
(3) provides adequate assurance that the pro-
posed project will be properly administered, oper-
ated, and maintained; and 
(4) otherwise meets the requirements of this 
Act. 
(d) VOTES FOR DECISIONS.—On certification by a 
State member of the Authority of an application for a 
grant or other assistance for a specific project under this 
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section, an affirmative vote of the Authority under section 
101(d) shall be required for approval of the application. 
SEC. 303. CONSENT OF STATES. 
Nothing in this Act requires any State to engage in 
or accept any program under this Act without the consent 
of the State. 
SEC. 304. RECORDS. 
(a) RECORDS OF THE AUTHORITY.— 
(1) IN GENERAL.—The Authority shall main-
tain accurate and complete records of all trans-
actions and activities of the Authority. 
(2) AVAILABILITY.—All records of the Author-
ity shall be available for audit and examination by 
the Comptroller General of the United States (in-
cluding authorized representatives of the Comp-
troller General). 
(b) RECORDS OF RECIPIENTS OF FEDERAL ASSIST-
ANCE.— 
(1) IN GENERAL.—A recipient of Federal funds 
under this Act shall, as required by the Authority, 
maintain accurate and complete records of trans-
actions and activities financed with Federal funds 
and report to the Authority on the transactions and 
activities. 
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(2) AVAILABILITY.—All records required under 
paragraph (1) shall be available for audit by the 
Comptroller General of the United States and the 
Authority (including authorized representatives of 
the Comptroller General and the Authority). 
(c) ANNUAL AUDIT.—The Comptroller General of the 
United States shall audit the activities, transactions, and 
records of the Authority on an annual basis. 
SEC. 305. ANNUAL REPORT. 
(a) IN GENERAL.—Not later than 180 days after the 
end of each fiscal year, the Authority shall submit to the 
President and to Congress a report describing the activi-
ties carried out under this Act. 
(b) CONTENTS.— 
(1) IN GENERAL.—The report shall include— 
(A) an evaluation of the progress of the 
Authority— 
(i) in meeting the goals set forth in 
the regional development plan and the 
State development plans; and 
(ii) in working with other Federal 
agencies and the border programs adminis-
tered by the Federal agencies; 
(B) examples of notable projects in each 
State; 
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(C) a description of all demonstration 
projects funded under section 306(b) during the 
fiscal year preceding submission of the report; 
and 
(D) any policy recommendations approved 
by the Authority. 
(2) INITIAL REPORT.—In addition to the con-
tents specified in paragraph (1), the initial report 
submitted under this section shall include— 
(A) a determination as to whether the cre-
ation of a loan fund to be administered by the 
Authority is necessary; and 
(B) if the Authority determines that a loan 
fund is necessary— 
(i) a request for the authority to es-
tablish a loan fund; and 
(ii) a description of the eligibility cri-
teria and performance requirements for the 
loans. 
SEC. 306. AUTHORIZATION OF APPROPRIATIONS. 
(a) IN GENERAL.—There are authorized to be appro-
priated to the Authority to carry out this Act, to remain 
available until expended— 
(1) $50,000,000 for fiscal year 2009; 
(2) $75,000,000 for fiscal year 2010; 
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