(A) IN GENERAL.—No person detailed to 
serve the Authority under subsection (e)(6) 
shall receive any salary or any contribution to 
or supplementation of salary for services pro-
vided to the Authority from—
(i) any source other than the State, 
local, or intergovernmental department or 
agency from which the person was detailed; 
or 
(ii) the Authority. 
(B) VIOLATION.—Any person that violates 
this paragraph shall be fined not more than 
$5,000, imprisoned not more than 1 year, or 
both. 
(C) APPLICABLE
LAW.—The Federal co-
chairperson, the alternate Federal cochair-
person, and any Federal officer or employee de-
tailed to duty on the Authority under sub-
section (e)(5) shall not be subject to subpara-
graph (A), but shall remain subject to sections 
202 through 209 of title 18, United States 
Code. 
(5) ADDITIONAL PERSONNEL.—
(A) COMPENSATION.—
(i) IN GENERAL.—The Authority may 
appoint and fix the compensation of an ex-
ecutive director and such other personnel 
as are necessary to enable the Authority to 
carry out the duties of the Authority. 
(ii) 
EXCEPTION.—Compensation 
under clause (i) shall not exceed the max-
imum rate for the Senior Executive Service 
under section 5382 of title 5, United 
States Code, including any applicable local-
ity-based comparability payment that may 
be authorized under section 5304(h)(2)(C) 
of that title. 
(B) EXECUTIVE DIRECTOR.—The executive 
director shall be responsible for—
(i) the carrying out of the administra-
tive duties of the Authority; 
(ii) direction of the Authority staff; 
and 
(iii) such other duties as the Author-
ity may assign. 
(C) NO FEDERAL EMPLOYEE STATUS.—No 
member, alternate, officer, or employee of the 
Authority (except the Federal cochairperson of 
the Authority, the alternate and staff for the
Federal cochairperson, and any Federal em-
ployee detailed to the Authority under sub-
section (e)(5)) shall be considered to be a Fed-
eral employee for any purpose. 
(i) CONFLICTS OF INTEREST.—
(1) IN GENERAL.—Except as provided under 
paragraph (2), no State member, alternate, officer, 
or employee of the Authority shall participate per-
sonally and substantially as a member, alternate, of-
ficer, or employee of the Authority, through decision, 
approval, disapproval, recommendation, the ren-
dering of advice, investigation, or otherwise, in any 
proceeding, application, request for a ruling or other 
determination, contract, claim, controversy, or other 
matter in which, to knowledge of the member, alter-
nate, officer, or employee any of the following per-
sons has a financial interest: 
(A) The member, alternate, officer, or em-
ployee. 
(B) The spouse, minor child, or partner of 
the member, alternate, officer, or employee. 
(C) Any organization (other than a State 
or political subdivision of the State) in which 
the member, alternate, officer, or employee is
serving as an officer, director, trustee, partner, 
or employee. 
(D) Any person or organization with whom 
the member, alternate, officer, or employee is 
negotiating or has any arrangement concerning 
prospective employment. 
(2) DISCLOSURE.—Paragraph (1) shall not 
apply if the State member, alternate, officer, or em-
ployee—
(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-
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, alternate, officer, or employee.
(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. 
(j) 
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 any provision under subsection (h)(4), subsection (i), 
or sections 202 through 209 of title 18, United States 
Code. 
SEC. 
4. 
ECONOMIC 
AND 
COMMUNITY 
DEVELOPMENT 
GRANTS. 
(a) IN
GENERAL.—The Authority may approve 
grants to States and public and nonprofit entities for 
projects, approved in accordance with section 10—
(1) to develop the infrastructure of the region 
for the purpose of facilitating economic development 
in the region (except that grants for this purpose 
may only be made to a State or local government); 
(2) to assist the region in obtaining job train-
ing, employment-related education, and business de-
velopment; 
(3) to provide assistance to severely distressed 
and underdeveloped areas; and
(4) to otherwise achieve the purposes of this 
Act. 
(b) FUNDING.—
(1) IN GENERAL.—Funds for grants under sub-
section (a) may be provided—
(A) entirely from appropriations to carry 
out this section; 
(B) in combination with funds available 
under another State or Federal grant program; 
or 
(C) from any other source. 
(2) FUNDING PRIORITY.—Not less than 50 per-
cent of the amount of expenditures approved by the 
Authority shall support activities or projects that 
benefit severely and persistently distressed counties 
and areas. 
(3) ELIGIBLE PROJECTS.—The Authority may 
provide assistance, make grants, enter into con-
tracts, or otherwise provide funds to eligible entities 
in the region for projects that promote—
(A) business development; 
(B) job training or employment-related 
education; 
(C) local planning and leadership develop-
ment;
(D) basic public infrastructure, including 
high-tech infrastructure, in distressed counties 
and isolated areas of distress; and 
(E) any other project facilitating economic 
development in the region. 
(4) FEDERAL
SHARE.—Notwithstanding any 
provision of law limiting the Federal share in any 
grant program, funds appropriated to carry out this 
section may be used to increase a Federal share in 
a grant program, as the Authority determines appro-
priate. 
SEC. 5. SUPPLEMENTS TO FEDERAL GRANT PROGRAMS. 
(a) FEDERAL GRANT PROGRAM FUNDING.—In ac-
cordance with subsection (b), the Federal cochairperson 
may use amounts made available to carry out this Act, 
without regard to any limitations on areas eligible for as-
sistance or authorizations for appropriation under any 
other Act, to fund all or any portion of the basic Federal 
contribution to a project or activity under a Federal grant 
program in the region in an amount that is above the fixed 
maximum portion of the cost of the project otherwise au-
thorized by applicable law, but not to exceed 80 percent 
of the costs of the project. 
(b) CERTIFICATION.—
(1) IN GENERAL.—In the case of any program 
or project for which all or any portion of the basic 
Federal contribution to the project under a Federal 
grant program is proposed to be made under this 
section, no Federal contribution shall be made until 
the Federal official administering the Federal law 
authorizing the contribution certifies that the pro-
gram or project—
(A) meets the applicable requirements of 
the applicable Federal grant law; and 
(B) could be approved for Federal con-
tribution under the law if funds were available 
under the law for the program or 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 10—
(i) shall be controlling; and 
(ii) shall be accepted by the Federal 
agencies. 
(B) ACCEPTANCE BY FEDERAL COCHAIR-
PERSON.—Any finding, report, certification, or 
documentation required to be submitted to the 
head of the department, agency, or instrumen-
tality of the Federal Government responsible for 
the administration of any Federal grant pro-
gram shall be accepted by the Federal cochair-
person with respect to a supplemental grant for 
any project under the program. 
SEC. 6. LOCAL DEVELOPMENT DISTRICTS; CERTIFICATION 
AND ADMINISTRATIVE EXPENSES. 
(a) DEFINITION
OF LOCAL DEVELOPMENT DIS-
TRICT.—In this section, the term ‘‘local development dis-
trict’’ means an entity designated by the State that—
(1) is—
(A)(i) a planning district in existence on 
the date of enactment of this Act that is recog-
nized by the Economic Development Adminis-
tration of the Department of Commerce; or 
(ii) a development district recognized by 
the State; or 
(B) if an entity described in subparagraph 
(A)(i) or (A)(ii) does not exist, an entity des-
ignated by the Authority that satisfies the cri-
teria developed by the Economic Development 
Administration for a local development district; 
and 
(2) has not, as certified by the Federal cochair-
person—
(A) inappropriately used Federal grant 
funds from any Federal source; or 
(B) appointed an officer who, during the 
period in which another entity inappropriately 
used Federal grant funds from any Federal 
source, was an officer of the other entity. 
(b) GRANTS TO LOCAL DEVELOPMENT DISTRICTS.—
(1) IN
GENERAL.—The Authority may make 
grants for administrative expenses under this sec-
tion. 
(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) 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. 
(c) 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; 
and
(2) serve as a liaison between State and local 
governments, 
nonprofit 
organizations 
(including 
community-based groups and educational institu-
tions), the business community, and citizens that—
(A) are involved in multijurisdictional plan-
ning; 
(B) provide technical assistance to local ju-
risdictions and potential grantees; and 
(C) provide leadership and civic develop-
ment assistance. 
SEC. 7. DISTRESSED COUNTIES AND AREAS AND NONDIS-
TRESSED COUNTIES. 
Not later than 90 days after the date of enactment 
of this Act, and annually thereafter, the Authority, in ac-
cordance with such criteria as the Authority establishes, 
may designate—
(1) as distressed counties, counties in the re-
gion that are the most severely and persistently dis-
tressed and underdeveloped and have high rates of 
poverty, low per capita income, or high rates of un-
employment; and 
(2) as isolated areas of distress, areas located 
in nondistressed counties in the region that are se-
verely and persistently distressed as documented by 
comparable statistical measures.
SEC. 8. DEVELOPMENT PLANNING PROCESS. 
(a) STATE DEVELOPMENT PLAN.—In accordance 
with policies established by the Authority, each State 
member shall submit a development plan for the area of 
the region represented by the State member. 
(b) CONTENT OF PLAN.—A State development plan 
submitted under subsection (a) shall reflect the goals, ob-
jectives, and priorities identified in the regional develop-
ment plan developed under section 3(d)(2). 
(c) CONSULTATION.—In carrying out the develop-
ment planning process, a State shall—
(1) consult with—
(A) local development districts; 
(B) local units of government; and 
(C) institutions of higher learning; and 
(2) take into consideration the goals, objectives, 
priorities, and recommendations of the entities de-
scribed in paragraph (1). 
(d) PUBLIC PARTICIPATION.—The Authority and ap-
plicable State and local development districts shall encour-
age and assist, to the maximum extent practicable, public 
participation in the development, revision, and implemen-
tation of all plans and programs under this Act. 
SEC. 9. 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 by the Authority, the Authority shall follow 
procedures that ensure, to the maximum extent prac-
ticable, consideration of—
(1) the relationship of the project to overall re-
gional development; 
(2) the per capita income and poverty and un-
employment rates and other socioeconomic indicators 
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 importance of the project in relation to 
other projects that may be in competition for the 
same funds; 
(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 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 an 
establishment in relocating from 1 area to another. 
(c) REDUCTION OF FUNDS.—Funds may be provided 
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 re-
duced as a result of funds made available by this Act. 
SEC. 
10. 
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 and Federal cochair-
person 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 9; 
(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.—Upon certification of an 
application for a grant or other assistance for a specific 
project under this section, an affirmative vote of the Au-
thority under section 3(c) shall be required for approval 
of the application. 
SEC. 11. 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. 12. 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 on the transactions and activities to the 
Authority. 
(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). 
SEC. 13. ANNUAL REPORT. 
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 activities carried out 
under this Act.
SEC. 14. AUTHORIZATION OF APPROPRIATIONS. 
(a) IN GENERAL.—There is authorized to be appro-
priated to the Authority to carry out this Act $40,000,000 
for each of fiscal years 2006 through 2010, to remain 
available until expended. 
(b) ADMINISTRATIVE EXPENSES.—Not more than 5 
percent of the amount appropriated under subsection (a) 
for a fiscal year shall be used for administrative expenses 
of the Authority. 
SEC. 15. TERMINATION OF AUTHORITY. 
This Act shall have no force or effect on or after Oc-
tober 1, 2010. 
SEC. 16. AREA COVERED BY SOUTHEAST CRESCENT AU-
THORITY. 
SouthEast Crescent Authority region shall include all 
parts of the States of Virginia, North Carolina, South 
Carolina, Georgia, Alabama, Mississippi, and Florida that 
are not eligible for assistance from the Appalachian Re-
gional Commission or the Delta Regional Authority.
Æ