Economic Development Administration and Appalachian Regional Development Reform Act of 1998
PL 105-393 (S.2364), enacted 11/13/1998

112 STAT. 3596 
PUBLIC LAW 105-393—NOV. 13, 1998 
Public Law 105-393 
105th Congress 
An Act 
Nov. 13, 1998 
[S. 2364J 
Economic 
Development 
Administration 
and Appalachian 
Regional 
Development 
Reform Act of 
1998. 
Urban and rural 
areas. 
42 u s e 3121 
note. 
To reauthorize and make reforms to programs authorized by the Public Works 
and Economic Development Act of 1965 and the Appalachian Regional Develop-
ment Act of 1965. 
Be it enacted by the Senate and House of Representatives 
of 
the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE; TABLE OF CONTENTS. 
(a) SHORT TITLE.—^This Act may be cited as the "Economic 
Development Administration and Appalachian Regional Develop-
ment Reform Act of 1998". 
(b) TABLE OF CONTENTS.—The table of contents of this Act 
is as follows: 
Sec. 1. Short title; table of contents. 
TITLE I—ECONOMIC DEVELOPMENT 
Sec. 101. Short title. 
Sec. 102. Reauthorization of Public Works and Economic Development Act of 1965. 
Sec. 103. Conforming amendment. 
Sec. 104. Transition provisions. 
Sec. 105. Effective date. 
TITLE II—APPALACHIAN REGIONAL DEVELOPMENT 
Sec. 201. Short title. 
Sec. 202. Findings and purposes. 
Sec. 203. Meetings. 
Sec. 204. Administrative expenses. 
Sec. 205. Compensation of employees. 
Sec. 206. Administrative powers of Commission. 
Sec. 207. Cost sharing of demonstration health projects. 
Sec. 208. Repeal of land stabilization, conservation, and erosion control program. 
Sec. 209. Repeal of timber development program. 
Sec. 210. Repeal of mining area restoration program. 
Sec. 211. Repeal of water resource survey. 
Sec. 212. Cost sharing of housing projects. 
Sec. 213. Repeal of airport safety improvements program. 
Sec. 214. Cost sharing of vocational education and education demonstration 
projects. 
Sec. 215. Repeal of sewage treatment works program. 
Sec. 216. Repeal of amendments to Housing Act of 1954. 
Sec. 217. Supplements to Federal grant-in-aid programs. 
Sec. 218. Program development criteria. 
Sec. 219. Distressed and economically strong counties. 
Sec. 220. Grants for administrative expenses and commission projects. 
Sec. 221. Authorization of appropriations for general program. 
Sec. 222. Extension of termination date. 
Sec. 223. Technical amendment. 
P U B L I C LAW 105-393—NOV. 13, 1998 
112 STAT. 3597 
TITLE I—ECONOMIC DEVELOPMENT 
Economic 
Development 
Administration 
SEC. 101. SHORT TITLE. 
Reform Act of 
This title may be cited as the "Economic Development Adminis- 
42^usc 3121 
tration Reform Act of 1998". 
note. 
SEC. 102. REAUTHORIZATION OF PUBLIC WORKS AND ECONOMIC 
DEVELOPMENT ACT OF 1965. 
(a) FIRST SECTION THROUGH TITLE VI—^The Public Works and 
Economic Development Act of 1965 (42 U.S.C. 3121 et seq.) is 
amended by striking the first section and all that follows through 
the end of title VI and inserting the following: 
"SECTION 1. SHORT TITLE; TABLE OF CONTENTS. 
42 USC 3121 
"(a) SHORT TITLE.—This Act may be cited as the 'Public Works 
"°*^' 
and Economic Development Act of 1965'. 
"(b) TABLE OF CONTENTS.—^The table of contents of this Act 
is as follows: 
"Sec. 1. Short title; table of contents. 
"Sec. 2. Findings and declarations. 
"Sec. 3. Definitions. 
"TITLE I—ECONOMIC DEVELOPMENT PARTNERSHIPS COOPERATION AND 
COORDINATION 
"Sec. 101. Establishment of economic development partnerships. 
"Sec. 102. Cooperation of Federal agencies. 
"Sec. 103. Coordination. 
"TITLE II—GRANTS FOR PUBLIC WORKS AND ECONOMIC DEVELOPMENT 
"Sec. 201. Grants for public works and economic development. 
"Sec. 202. Base closings and realignments. 
"Sec. 203. Grants for planning and grants for administrative expenses. 
"Sec. 204. Cost sharing. 
"Sec. 205. Supplementary grants. 
"Sec. 206. Regulations on relative needs and allocations. 
"Sec. 207. Grants for training, research, and technical assistance. 
"Sec. 208. Prevention of unfair competition. 
"Sec. 209. Grants for economic adjustment. 
"Sec. 210. Changed project circumstances. 
"Sec. 211. Use of funds in projects constructed under projected cost. 
"Sec. 212. Reports by recipients. 
"Sec. 213. Prohibition on use of funds for attorney's and consultant's fees. 
"TITLE III—ELIGIBILITY; COMPREHENSIVE ECONOMIC DEVELOPMENT 
STRATEGIES 
"Sec. 301. Eligibility of areas. 
"Sec. 302. Comprehensive economic development strategies. 
"TITLE IV—ECONOMIC DEVELOPMENT DISTRICTS 
"Sec. 401. Designation of economic development districts. 
"Sec. 402. Termination or modification of economic development districts. 
"Sec. 403. Incentives. 
"Sec. 404. Provision of comprehensive economic development strategies to Appa-
lachian Regional Commission. 
"Sec. 405. Assistance to parts of economic development districts not in eligible 
areas. 
"TITLE V—ADMINISTRATION 
"Sec. 501. Assistant Secretary for Economic Development. 
"Sec. 502. Economic development information clearinghouse. 
"Sec. 503. Consultation with other persons and agencies. 
"Sec. 504. Administration, operation, and maintenance. 
"Sec. 505. Businesses desiring Federal contracts. 
"Sec. 506. Performance evaluations of grant recipients. 
112 STAT. 3598 
PUBLIC LAW 105-393—NOV. 13, 1998 
"Sec. 507. Notification of reorganization. 
"TITLE VI—MISCELLANEOUS 
"Sec. 601. Powers of Secretary. 
"Sec. 602. Maintenance of standards. 
"Sec. 603. Annual report to Congress. 
"Sec. 604. Delegation of functions and transfer of funds among Federal agencies. 
"Sec. 605. Penalties. 
"Sec. 606. Employment of expediters and administrative employees. . 
"Sec. 607. Maintenance and public inspection of list of approved applications for fi-
nancial assistance. 
"Sec. 608. Records and audits. 
"Sec. 609. Relationship to assistance under other law. 
"Sec. 610. Acceptance of certifications by applicants. 
"TITLE VII—FUNDING 
"Sec. 701. General authorization of appropriations. 
"Sec. 702. Authorization of appropriations for defense conversion activities. 
"Sec. 703. Authorization of appropriations for disaster economic recovery activities. 
42 u s e 3121. 
"SEC. 2. FINDINGS AND DECLARATIONS. 
"(a) FINDINGS.—Congress finds that— 
"(1) while the economy of the United States is undergoing 
a sustained period of economic growth resulting in low 
unemplo3mrient and increasing incomes, there continue to be 
areas suffering economic distress in the form of high unemploy-
ment, low incomes, underemployment, and outmigration as well 
as areas facing sudden economic dislocations due to industrial 
restructuring and relocation, defense base closures and procure-
ment cutbacks, certain Federal actions (including environ-
mental requirements that result in the removal of economic 
activities from a locality), and natural disasters; 
"(2) as the economy of the United States continues to 
grow, those distressed areas contain significant human and 
infrastructure resources that are underused; 
"(3) expanding international trade and the increasing pace 
of technological innovation offer both a challenge and an oppor-
tunity to the distressed communities of the United States; 
"(4) while economic development is an inherently local proc-
ess, the Federal Government should work in partnership with 
public and private local, regional, and State organizations to 
ensure that existing resources are not wasted and all Americans 
have an opportunity to participate in the economic growth 
of the United States; 
"(5) in order to avoid wasteful duplication of effort and 
to limit the burden on distressed communities. Federal, State, 
and local economic development activities should be better 
planned and coordinated and Federal program requirements 
should be simplified and made more consistent; 
"(6) the goal of Federal economic development activities 
should be to work in partnership with local, regional, and 
State public and private organizations to support the develop-
ment of private sector businesses and jobs in distressed commu-
nities; 
"(7) Federal economic development efforts will be more 
effective if they are coordinated with, and build upon, the 
trade and technology programs of the United States; and 
"(8) under this Act, new employment opportunities should 
be created by developing and expanding new and existing public 
works and other facilities and resources rather than by merely 
transferring jobs from one area of the United States to another. 
PUBLIC LAW 105-393—NOV. 13, 1998 
112 STAT. 3599 
"(b) DECLARATIONS.—Congress declares that, in order to pro-
mote a strong and growing economy throughout the United States— 
"(1) assistance under this Act should be made available 
to both rural and urban distressed communities; 
"(2) local communities should work in partnership with 
neighboring communities, the States, and the Federal Govern-
ment to increase their capacity to develop and implement com-
prehensive economic development strategies to address existing, 
or deter impending, economic distress; and 
"(3) whether suffering from long-term distress or a sudden 
dislocation, distressed communities should be encouraged to 
take advantage of the development opportunities afforded by 
technological innovation and expanding and newly opened 
global markets. 
"SEC. 3. DEFINITIONS. 
42 USC 3122. 
"In this Act: 
"(1) COMPREHENSIVE ECONOMIC DEVELOPMENT STRATEGY.— 
The term 'comprehensive economic development 
strategy' 
means 
a 
comprehensive 
economic 
development 
strategy 
approved by the Secretary under section 302. 
"(2) DEPARTMENT.—^The term 'Department' means the 
Department of Commerce. 
"(3) ECONOMIC DEVELOPMENT DISTRICT.— 
"(A) IN GENERAL.—^The term 'economic development 
district' means any area in the United States that— 
"(i) is composed of areas described in section 301(a) 
and, to the extent appropriate, neighboring counties 
or communities; and 
"(ii) has been designated by the Secretary as an 
economic development district under section 401. 
"(B) INCLUSION.—The term 'economic development dis-
trict' includes any economic development district des-
ignated by the Secretary under section 403 (as in effect 
on the day before the effective date of the Economic 
Development Administration Reform Act of 1998). 
"(4) ELIGIBLE RECIPIENT.— 
"(A) IN GENERAL.—^The term 'eligible recipient' means— 
"(i) an area described in section 301(a); 
"(ii) an economic development district; 
"(iii) an Indian tribe; 
"(iv) a State; 
"(v) a city or other political subdivision of a State 
or a consortium of political subdivisions; 
"(vi) an institution of higher education or a consor-
tium of institutions of higher education; or 
"(vii) a public or private nonprofit organization 
or association acting in cooperation with officials of 
a political subdivision of a State. 
"(B) TRAINING, RESEARCH, AND TECHNICAL ASSISTANCE 
GRANTS.—In the case of grants under section 207, the term 
'eligible recipient' also includes private individuals and for-
profit organizations. 
"(5) FEDERAL AGENCY.—^The term 'Federal agency' means 
a department, agency, or instrumentality of the United States. 
112 STAT. 3600 
PUBLIC LAW 105-393—NOV. 13, 1998 
"(6) GRANT.—^The term 'grant' includes a cooperative agree-
ment (within the meaning of chapter 63 of title 31, United 
States Code). 
"(7) INDIAN TRIBE.—^The term 'Indian tribe' means any 
Indian tribe, band, nation, pueblo, or other organized group 
or community, including any Alaska Native village or Regional 
Corporation (as defined in or established under the Alaska 
Native Claims Settlement Act (43 U.S.C. 1601 et seq.)), that 
is recognized as eligible for the special programs and services 
provided by the United States to Indians because of their 
status as Indians. 
"(8) SECRETARY.—The term 'Secretary' means the Secretary 
of Commerce. 
"(9) STATE.—The term 'State' means a State, the District 
of Columbia, the Commonwealth of Puerto Rico, the Virgin 
Islands, Guam, American Samoa, the Commonwealth of the 
Northern Mariana Islands, the Republic of the Marshall 
Islands, the Federated States of Micronesia, and the Republic 
of Palau. 
"(10) UNITED STATES.—^The term 'United States' means all 
of the States. 
"TITLE 
I—ECONOMIC 
DEVELOPMENT 
PARTNERSHIPS COOPERATION AND 
COORDINATION 
42 use 3131. 
"SEC. 101. ESTABLISHMENT OF ECONOMIC DEVELOPMENT PARTNER-
SHIPS. 
"(a) IN GENERAL.—In providing assistance under this title, the 
Secretary shall cooperate with States and other entities to ensure 
that, consistent with national objectives, Federal programs are 
compatible with and further the objectives of State, regional, and 
local economic development plans and comprehensive economic 
development strategies. 
"(b) TECHNICAL ASSISTANCE.—^The Secretary may provide such 
technical assistance to States, political subdivisions of States, sub-
State regional organizations (including organizations that cross 
State boundaries), and multi-State regional organizations as the 
Secretary determines is appropriate to— 
"(1) alleviate economic distress; 
"(2) encourage and support public-private partnerships for 
the formation and improvement of economic development 
strategies that sustain and promote economic development 
across the United States; and 
"(3) promote investment in infrastructure and technological 
capacity to keep pace with the changing global economy. 
Regulations. 
"(c) INTERGOVERNMENTAL 
REVIEW.—The 
Secretary 
shall 
promulgate regulations to ensure that appropriate State and local 
government agencies have been given a reasonable opportunity 
to review and comment on proposed projects under this title that 
the Secretary determines may have a significant direct impact 
on the economy of the area. 
"(d) COOPERATION AGREEMENTS.— 
"(1) IN GENERAL.—^The Secretary may enter into a coopera-
tion agreement with any 2 or more adjoining States, or an 
PUBLIC LAW 105-393—NOV. 13, 1998 
112 STAT. 3601 
organization of any 2 or more adjoining States, in support 
of effective economic development. 
"(2) PARTICIPATION.—Each cooperation agreement shall 
provide for suitable participation by other governmental and 
nongovernmental entities that are representative of significant 
interests in and perspectives on economic development in an 
area. 
"SEC. 102. COOPERATION OF FEDERAL AGENCIES. 
42 USC 3132. 
"In accordance with applicable laws and subject to the availabil-
ity of appropriations, each Federal agency shall exercise its powers, 
duties and functions, and shall cooperate with the Secretary, in 
such manner as will assist the Secretary in carrying out this title. 
"SEC. 103. COORDINATION. 
42 USC 3133. 
"The Secretary shall coordinate activities relating to the 
preparation 
and 
implementation 
of comprehensive 
economic 
development strategies under this Act with Federal agencies carry-
ing out other Federal programs. States, economic development dis-
tricts, and other appropriate planning and development organiza-
tions. 
"TITLE II—GRANTS FOR PUBLIC WORKS 
AND ECONOMIC DEVELOPMENT 
"SEC. 201. GRANTS FOR PUBLIC WORKS AND ECONOMIC DEVELOP- 
42 USC 3141. 
MENT. 
"(a) IN GENERAL.—On the application of an eligible recipient, 
the Secretary may make grants for— 
"(1) acquisition or development of land and improvements 
for use for a public works, public service, or development facil-
ity; and 
"(2) acquisition, design and engineering, construction, 
rehabilitation, alteration, expansion, or improvement of such 
a facility, including related machinery and equipment. 
"(b) CRITERIA FOR GRANT.—^The Secretary may make a grant 
under this section only if the Secretary determines that— 
"(1) the project for which the grant is applied for will, 
directly or indirectly— 
"(A) improve the opportunities, in the area where the 
project is or will be located, for the successful establishment 
or expansion of industrial or commercial plants or facilities; 
"(B) assist in the creation of additional long-term 
employment opportunities in the area; or 
"(C) primarily benefit the long-term unemployed and 
members of low-income families; 
"(2) the project for which the grant is applied for will 
fulfill a pressing need of the area, or a part of the area, 
in which the project is or will be located; and 
"(3) the area for which the project is to be carried out 
has a comprehensive economic development strategy and the 
project is consistent with the strategy. 
"(c) MAXIMUM ASSISTANCE FOR EACH STATE.—^Not more than 
15 percent of the amounts made available to carry out this section 
may be expended in any 1 State. 
112 STAT. 3602 
PUBLIC LAW 105-393—NOV. 13, 1998 
42 use 3142. 
"SEC. 202. BASE CLOSINGS AND REALIGNMENTS. 
"Notwithstanding any other provision of law, the Secretary 
may provide to an eligible recipient any assistance available under 
this title for a project to be carried out on a military or Department 
of Energy installation that is closed or scheduled for closure or 
realignment without requiring that the eligible recipient have title 
to the property or a leasehold interest in the property for any 
specified term. 
42 use 3143. 
"SEC. 203. GRANTS FOR PLANNING AND GRANTS FOR ADMINISTRA-
TIVE EXPENSES. 
"(a) IN GENERAL.—On the application of an eligible recipient, 
the Secretary may make grants to pay the costs of economic develop-
ment planning and the administrative expenses of organizations 
that carry out the planning. 
"(b) PLANNING PROCESS.—Planning assisted under this title 
shall be a continuous process involving public officials and private 
citizens in— 
"(1) analyzing local economies; 
"(2) defining economic development goals; 
"(3) determining project opportunities; and 
"(4) formulating and implementing an economic develop-
ment program that includes systematic efforts to reduce 
unemployment and increase incomes. 
"(c) USE OF PLANNING ASSISTANCE.—Planning assistance under 
this title shall be used in conjunction with any other available 
Federal planning assistance to ensure adequate and effective plan-
ning and economical use of funds. 
"(d) STATE PLANS.— 
"(1) DEVELOPMENT.—^Any State plan developed with assist-
ance under this section shall be developed cooperatively by 
the State, political subdivisions of the State, and the economic 
development districts located wholly or partially in the State. 
"(2) COMPREHENSIVE ECONOMIC DEVELOPMENT STRATEGY.— 
As a condition of receipt of assistance for a State plan under 
this subsection, the State shall have or develop a comprehensive 
economic development strategy. 
"(3) CERTIFICATION TO THE SECRETARY.—On completion of 
a State plan developed with assistance under this section, 
the State shall— 
"(A) certify to the Secretary that, in the development 
of the State plan, local and economic development district 
plans were considered and, to the maximum extent prac-
ticable, the State plan is consistent with the local and 
economic development district plans; and 
"(B) identify any inconsistencies between the State plan 
and the local and economic development district plans and 
provide a justification for each inconsistency. 
"(4) 
COMPREHENSIVE 
PLANNING 
PROCESS.—^Any overall 
State economic development planning assisted under this sec-
tion shall be a part of a comprehensive planning process that 
shall consider the provision of public works to— 
"(A) promote economic development and opportunity; 
"(B) foster effective transportation access; 
"(C) enhance and protect the environment; and 
"(D) balance resources through the sound management 
of physical development. 
PUBLIC LAW 105-393—NOV. 13, 1998 
112 STAT. 3603 
"(5) REPORT TO SECRETARY.—Each State that receives 
assistance for the development of a plan under this subsection 
shall submit to the Secretary an annual report on the planning 
process assisted under this subsection. 
"SEC. 204. COST SHARING. 
42 USC 3144. 
"(a) FEDERAL SHARE.—Subject to section 205, the amount of 
a grant for a project under this title shall not exceed 50 percent 
of the cost of the project. 
"(b) NON-FEDERAL SHARE.—In determining the amount of the 
non-Federal share of the cost of a project, the Secretary may provide 
credit toward the non-Federal share for all contributions both in 
cash and in-kind, fairly evaluated, including contributions of space, 
equipment, and services. 
"SEC. 205. SUPPLEMENTARY GRANTS. 
42 USC 3145. 
"(a) DEFINITION OF DESIGNATED FEDERAL GRANT PROGRAM.— 
In this section, the term 'designated Federal grant program' means 
any Federal grant program that— 
"(1) provides assistance in the construction or equipping 
of public works, public service, or development facilities; 
"(2) the Secretary designates as eligible for an allocation 
of funds under this section; and 
"(3) assists projects that are— 
"(A) eligible for assistance under this title; and 
"(B) consistent with a comprehensive economic develop-
ment strategy. 
"(b) SUPPLEMENTARY GRANTS.— 
"(1) IN GENERAL.—On the application of an eligible recipi-
ent, the Secretary may make a supplementary grant for a 
project for which the eligible recipient is eligible but, because 
of the eligible recipient's economic situation, for which the 
eligible recipient cannot provide the required non-Federal 
share. 
"(2) PURPOSES OF GRANTS.—Supplementary grants under 
paragraph (1) may be made for purposes that shall include 
enabling eligible recipients to use— 
"(A) designated Federal grant programs; and 
"(B) direct grants authorized under this title. 
"(c) REQUIREMENTS APPLICABLE TO SUPPLEMENTARY GRANTS.— 
"(1) AMOUNT OF SUPPLEMENTARY GRANTS.—Subject to para-
graph (4), the amount of a supplementary grant under this 
title for a project shall not exceed the applicable percentage 
of the cost of the project established by regulations promulgated 
by the Secretary, except that the non-Federal share of the 
cost of a project (including assumptions of debt) shall not be 
less than 20 percent. 
"(2) FORM OF SUPPLEMENTARY GRANTS.—In accordance with 
such regulations as the Secretary may promulgate, the Sec-
retary shall make supplementary grants by increasing the 
amounts of grants authorized under this title or by the payment 
of funds made available under this Act to the heads of the 
Federal agencies responsible for carrying out the applicable 
Federal programs. 
"(3) 
FEDERAL 
SHARE LIMITATIONS SPECIFIED IN OTHER 
LAWS.—^Notwithstanding any requirement as to the amount 
or source of non-Federal funds that may be applicable to a 
Federal program, funds provided under this section may be 
112 STAT. 3604 
PUBLIC LAW 105-393—NOV. 13, 1998 
used to increase the Federal share for specific projects under 
the program that are carried out in areas described in section 
301(a) above the Federal share of the cost of the project author-
ized by the law governing the program. 
"(4) LOWER NON-FEDERAL SHARE.— 
"(A) INDIAN TRIBES.—In the case of a grant _ to an 
Indian tribe, the Secretary may reduce the non-Federal 
share below the percentage specified in paragraph (1) or 
may waive the non-Federal share. 
"(B) CERTAIN STATES, POLITICAL SUBDIVISIONS, AND 
NONPROFIT ORGANIZATIONS.—In the case of a grant to a 
State, or a political subdivision of a State, that the Sec-
retary determines has exhausted its effective taxing and 
borrowing capacity, or in the case of a grant to a nonprofit 
organization that the Secretary determines has exhausted 
its effective borrowing capacity, the Secretary may reduce 
the non-Federal share below the percentage specified in 
paragraph (1). 
42 use 3146. 
"SEC. 206. REGULATIONS ON RELATIVE NEEDS AND ALLOCATIONS. 
"In promulgating rules, regulations, and procedures for assist-
ance under this title, the Secretary shall ensure that— 
"(1) the relative needs of eligible areas are given adequate 
consideration by the Secretary, as determined based on, among 
other relevant factors— 
"(A) the severity of the rates of unemployment in the 
eligible areas and the duration of the unemployment; 
"(B) the income levels and the extent of underemploy-
ment in eligible areas; and 
"(C) the outmigration of population from eligible areas 
and the extent to which the outmigration is causing eco-
nomic injury in the eligible areas; and 
"(2) allocations of assistance under this title are prioritized 
to ensure that the level of economic distress of an area, rather 
than a preference for a geographic area or a specific type 
of economic distress, is the primary factor in allocating the 
assistance. 
42 use 3147. 
"SEC. 207. GRANTS FOR TRAINING, RESEARCH, AND TECHNICAL 
ASSISTANCE. 
"(a) IN GENERAL.— 
"(1) GRANTS.—On the application of an eligible recipient, 
the Secretary may make grants for training, research, and 
technical assistance, including grants for program evaluation 
and economic impact analyses, that would be useful in alleviat-
ing or preventing conditions of excessive unemployment or 
underemployment. 
"(2) TYPES OF ASSISTANCE.—Grants under paragraph (1) 
may be used for— 
"(A) project planning and feasibility studies; 
"(B) demonstrations of innovative activities or strategic 
economic development investments; 
"(C) management and operational assistance; 
"(D) establishment of university centers; 
"(E) establishment of business outreach centers; 
"(F) studies evaluating the needs of, and development 
potential for, economic growth of areas that the Secretary 
determines have substantial need for the assistance; and 
PUBLIC LAW 105-393—NOV. 13, 1998 
112 STAT. 3605 
"(G) other activities determined by the Secretary to 
be appropriate. 
"(3) REDUCTION OR WAIVER OF NON-FEDERAL SHARE.—In 
the case of a project assisted under this section, the Secretary 
may reduce or waive the non-Federal share, without regard 
to section 204 or 205, if the Secretary finds that the project 
is not feasible without, and merits, such a reduction or waiver. 
"(b) 
METHODS OF PROVISION OF ASSISTANCE.—In providing 
research and technical assistance under this section, the Secretary, 
in addition to making grants under subsection (a), may— 
"(1) provide research and technical assistance through offi-
cers or employees of the Department; 
"(2) pay funds made available to carry out this section 
to Federal agencies; or 
"(3) employ private individuals, partnerships, businesses, 
corporations, or appropriate 
institutions 
under 
contracts 
entered into for that purpose. 
"SEC. 208. PREVENTION OF UNFAIR COMPETITION. 
42 USC 3148. 
"No financial assistance under this Act shall be extended to 
any project when the result would be to increase the production 
of goods, materials, or commodities, or the availability of services 
or facilities, when there is not sufficient demand for such goods, 
materials, commodities, services, or facilities, to employ the efficient 
capacity of existing competitive commercial or industrial enter-
prises. 
"SEC. 209. GRANTS FOR ECONOMIC ADJUSTMENT. 
42 USC 3149. 
"(a) IN GENERAL.—On the application of an eligible recipient, 
the Secretary may make grants for development of public facilities, 
public services, business development (including funding of a revolv-
ing loan fund), planning, technical assistance, training, and any 
other assistance to alleviate long-term economic deterioration and 
sudden and severe economic dislocation and further the economic 
adjustment objectives of this title. 
"(b) CRITERIA FOR ASSISTANCE.—^The Secretary may provide 
assistance under this section only if the Secretary determines that— 
"(1) the project will help the area to meet a special need 
arising from— 
"(A) actual or threatened severe unemployment; or 
"(B) economic adjustment problems resulting from 
severe changes in economic conditions; and 
"(2) the area for which a project is to be carried out has 
a comprehensive economic development strategy and the project 
is consistent with the strategy, except that this paragraph 
shall not apply to planning projects. 
"(c) PARTICULAR COMMUNITY ASSISTANCE.—^Assistance under 
this section may include assistance provided for activities identified 
by communities, the economies of which are injured by— 
"(1) military base closures or realignments, defense contrac-
tor reductions in force, or Department of Energy defense-related 
funding reductions, for help in diversifying their economies 
through projects to be carried out on Federal Government 
installations or elsewhere in the communities; 
"(2) disasters or emergencies, in areas with respect to which 
a major disaster or emergency has been declared under the 
Robert T. Stafford Disaster Relief and Emergency Assistance 
Act (42 U.S.C. 5121 et seq.), for post-disaster economic recovery; 
112 STAT. 3606 
PUBLIC LAW 105-393—NOV. 13, 1998 
"(3) international trade, for help in economic restructuring 
of the communities; or 
"(4) fishery failures, in areas with respect to which a deter-
mination that there is a commercial fishery failure has been 
made under section 312(a) of the Magnuson-Stevens Fishery 
Conservation and Management Act (16 U.S.C. 1861a(a)). 
"(d) DIRECT EXPENDITURE OR REDISTRIBUTION BY RECIPIENT.— 
"(1) IN GENERAL.—Subject to paragraph (2), an eligible 
recipient of a grant under this section may directly expend 
the grant funds or may redistribute the funds to public and 
private entities in the form of a grant, loan, loan guarantee, 
payment to reduce interest on a loan guarantee, or other appro-
priate assistance. 
"(2) LIMITATION.—^Under paragraph (1), an eligible recipient 
may not provide any grant to a private for-profit entity. 
42 use 3150. 
"SEC. 210. CHANGED PROJECT CIRCUMSTANCES. 
"In any case in which a grant (including a supplementary 
grant described in section 205) has been made by the Secretary 
under this title (or made under this Act, as in effect on the day 
before the effective date of the Economic Development Administra-
tion Reform Act of 1998) for a project, and, after the grant has 
been made but before completion of the project, the purpose or 
scope of the project that was the basis of the grant is modified, 
the Secretary may approve, subject (except for a grant for which 
funds were obligated in fiscal year 1995) to the availability of 
appropriations, the use of grant funds for the modified project 
if the Secretary determines that— 
"(1) the modified project meets the requirements of this 
title and is consistent with the comprehensive economic 
development strategy submitted as part of the application for 
the grant; and 
"(2) the modifications are necessary to enhance economic 
development in the area for which the project is being carried 
out. 
42 use 3151. 
"SEC. 211. USE OF FUNDS IN PROJECTS CONSTRUCTED UNDER PRO-
JECTED COST. 
"In any case in which a grant (including a supplementary 
grant described in section 205) has been made by the Secretary 
under this title (or made under this Act, as in effect on the day 
before the effective date of the Economic Development Administra-
tion Reform Act of 1998) for a construction project, and, after 
the grant has been made but before completion of the project, 
the cost of the project based on the designs and specifications 
that was the basis of the grant has decreased because of decreases 
in costs— 
"(1) the Secretary may approve, subject to the availability 
of appropriations, the use of the excess funds or a portion 
of the funds to improve the project; and 
"(2) any amount of excess funds remaining after application 
of paragraph (1) shall be deposited in the general fund of 
the Treasury. 
42 use 3152. 
"SEC. 212. REPORTS BY RECIPIENTS. 
Regulations. 
"(a) IN GENERAL.—Each recipient of assistance under this title 
shall submit reports to the Secretary at such intervals and in 
such manner as the Secretary shall require by regulation, except 
PUBLIC LAW 105-393—NOV. 13, 1998 
112 STAT. 3607 
that no report shall be required to be submitted more than 10 
years after the date of closeout of the assistance award. 
"(b) CONTENTS.—^Each report shall contain an evaluation of 
the effectiveness of the economic assistance provided under this 
title in meeting the need that the assistance was designed to 
address and in meeting the objectives of this Act. 
«SEC. 213. PROHIBITION ON USE OF FUNDS FOR ATTORNEY'S AND 
42 USC 3153. 
CONSULTANTS FEES. 
"Assistance made available under this title shall not be used 
directly or indirectly for an attorney's or consultant's fee incurred 
in connection with obtaining grants and contracts under this title. 
"TITLE III—ELIGIBILITY; COMPREHEN-
SIVE 
ECONOMIC 
DEVELOPMENT 
STRATEGIES 
"SEC. 301. ELIGIBILITY OF AREAS. 
42 USC 3161. 
"(a) IN GENERAL.—For a project to be eligible for assistance 
under section 201 or 209, the project shall be located in an area 
that, on the date of submission of the application, meets 1 or 
more of the following criteria: 
"(1) Low PER CAPITA INCOME.—^The area has a per capita 
income of 80 percent or less of the national average. 
"(2) UNEMPLOYMENT RATE ABOVE NATIONAL AVERAGE.—The 
area has an unemployment rate that is, for the most recent 
24-month period for which data are available, at least 1 percent 
greater than the national average unemployment rate. 
"(3) UNEMPLOYMENT OR ECONOMIC ADJUSTMENT PROB-
LEMS.—The area is an area that the Secretary determines 
has experienced or is about to experience a special need arising 
from actual or threatened severe unemployment or economic 
adjustment problems resulting from severe short-term or long-
term changes in economic conditions. 
"(b) POLITICAL BOUNDARIES OF AREAS.—An area that meets 
1 or more of the criteria of subsection (a), including a small area 
of poverty or high unemployment within a larger community in 
less economic distress, shall be eligible for assistance under section 
201 or 209 without regard to political or other subdivisions or 
boundaries. 
"(c) DOCUMENTATION.— 
"(1) IN GENERAL.—^A determination of eligibility under sub-
section (a) shall be supported by the most recent Federal data 
available, or, if no recent Federal data is available, by the 
most recent data available through the government of the State 
in which the area is located. 
"(2) ACCEPTANCE BY SECRETARY.—^The documentation shall 
be accepted by the Secretary unless the Secretary determines 
that the documentation is inaccurate. 
"(d) PRIOR DESIGNATIONS.—^Any designation of a redevelopment 
area made before the effective date of the Economic Development 
Administration Reform Act of 1998 shall not be effective after 
that effective date. 
112 STAT. 3608 
PUBLIC LAW 105-393—NOV. 13, 1998 
42 use 3162. 
"SEC. 302, COMPREHENSIVE ECONOMIC DEVELOPMENT STRATEGIES. 
"(a) IN GENERAL.—^The Secretary may provide assistance under 
section 201 or 209 (except for planning assistance under section 
209) to an eligible recipient for a project only if the eligible recipient 
submits to the Secretary, as part of an application for the assist-
ance— 
"(1) an identification of the economic development problems 
to be addressed using the assistance; 
"(2) an identification of the past, present, and projected 
future economic development investments in the area receiving 
the assistance and public and private participants and sources 
of funding for the investments; and 
"(3)(A) a comprehensive economic development strategy for 
addressing the economic problems identified under paragraph 
(1) in a manner that promotes economic development and oppor-
tunity, fosters effective transportation access, enhances and 
protects the environment, and balances resources through 
sound management of development; and 
"(B) a description of how the strategy will solve the prob-
lems. 
"(b) APPROVAL OF COMPREHENSIVE ECONOMIC DEVELOPMENT 
STRATEGY.—^The Secretary shall approve a comprehensive economic 
development strategy that meets the requirements of subsection 
(a) to the satisfaction of the Secretary. 
"(c) APPROVAL OF OTHER PLAN.—The Secretary may accept 
as a comprehensive economic development strategy a satisfactory 
plan developed under another federally supported program. 
"TITLE IV—ECONOMIC DEVELOPMENT 
DISTRICTS 
42 use 3171 
"SEC. 401. DESIGNATION OF ECONOMIC DEVELOPMENT 
DISTRICTS. 
"(a) IN GENERAL.—In order that economic development projects 
of broad geographic significance may be planned and carried out, 
the Secretary may designate appropriate economic development 
districts in the United States, with the concurrence of the States 
in which the districts will be wholly or partially located, if— 
"(1) the proposed district is of sufficient size or population, 
and contains sufficient resources, to foster economic develop-
ment on a scale involving more than a single area described 
in section 301(a); 
"(2) the proposed district contains at least 1 area described 
in section 301(a); and 
"(3) the proposed district has a comprehensive economic 
development strategy that— 
"(A) contains a specific program for intra-district 
cooperation, self-help, and public investment; and 
"(B) is approved by each affected State and by the 
Secretary. 
"(b) AUTHORITIES.—The Secretary may, under regulations 
promulgated by the Secretary— 
"(1) invite the States to determine boundaries for proposed 
economic development districts; 
"(2) cooperate with the States— 
PUBLIC LAW 105-393—NOV. 13, 1998 
112 STAT. 3609 
"(A) in sponsoring and assisting district economic plan-
ning and economic development groups; and 
"(B) in assisting the district groups in formulating 
comprehensive economic development strategies for dis-
tricts; and 
"(3) encourage participation by appropriate local govern-
ment entities in the economic development districts. 
"SEC. 402. TERMINATION OR MODIFICATION OF ECONOMIC DEVELOP-
MENT DISTRICTS. 
"The Secretary shall, by regulation, promulgate standards for 
the termination or modification of the designation of economic 
development districts. 
"SEC. 403. INCENTIVES. 
"(a) IN GENERAL.—Subject to the non-Federal share require-
ment under section 205(c)(1), the Secretary may increase the 
amount of grant assistance for a project in an economic development 
district by an amount that does not exceed 10 percent of the 
cost of the project, in accordance with such regulations as the 
Secretary shall promulgate, if— 
"(1) the project applicant is actively participating in the 
economic development activities of the district; and 
"(2) the project is consistent with the comprehensive eco-
nomic development strategy of the district. 
"(b) REVIEW OF INCENTIVE SYSTEM.—In promulgating regula-
tions under subsection (a), the Secretary shall review the current 
incentive system to ensure that the system is administered in 
the most direct and effective manner to achieve active participation 
by project applicants in the economic development activities of 
economic development districts. 
"SEC. 404. PROVISION OF COMPREHENSIVE 
ECONOMIC 
DEVELOP-
MENT STRATEGIES TO APPALACHIAN REGIONAL COMMIS-
SION. 
"If any part of an economic development district is in the 
Appalachian region (as defined in section 403 of the Appalachian 
Regional Development Act of 1965 (40 U.S.C. App.)), the economic 
development district shall ensure that a copy of the comprehensive 
economic development strategy of the district is provided to the 
Appalachian Regional Commission established under that Act. 
"SEC. 405. ASSISTANCE TO PARTS OF ECONOMIC DEVELOPMENT DIS-
TRICTS NOT IN ELIGIBLE AREAS. 
"Notwithstanding section 301, the Secretary may provide such 
assistance as is available under this Act for a project in a part 
of an economic development district that is not in an area described 
in section 301(a), if the project will be of a substantial direct 
benefit to an area described in section 301(a) that is located in 
the district. 
Regulations. 
42 use 3172. 
Regulations. 
42 use 3173. 
42 use 3174. 
42 use 3175. 
112 STAT. 3610 
PUBLIC LAW 105-393—NOV. 13, 1998 
"TITLE V—ADMINISTRATION 
42 use 3191. 
"SEC. 501. ASSISTANT SECRETARY FOR ECONOMIC DEVELOPMENT. 
President. 
"(a) IN GENERAL.—^The Secretary shall carry out this Act 
through an Assistant Secretary of Commerce for Economic Develop-
ment, to be appointed by the President, by and with the advice 
and consent of the Senate. 
"(b) COMPENSATION.—^The Assistant Secretary of Commerce for 
Economic Development shall be compensated at the rate payable 
for level IV of the Executive Schedule under section 5315 of title 
5, United States Code. 
"(c) DUTIES.—^The Assistant Secretary of Commerce for Eco-
nomic Development shall carry out such duties as the Secretary 
shall require and shall serve as the administrator of the Economic 
Development Administration of the Department. 
42 use 3192. 
"SEC. 502. ECONOMIC DEVELOPMENT INFORMATION CLEARINGHOUSE. 
"In carr3dng out this Act, the Secretary shall— 
"(1) maintain a central information clearinghouse on mat-
ters relating to economic development, economic adjustment, 
disaster recovery, defense conversion, and trade adjustment 
programs and activities of the Federal and State governments, 
including political subdivisions of States; 
"(2) assist potential and actual applicants for economic 
development, economic adjustment, disaster recovery, defense 
conversion, and trade adjustment assistance under Federal, 
State, and local laws in locating and applying for the assistance; 
and 
"(3) assist areas described in section 301(a) and other areas 
by providing to interested persons, communities, industries, 
and businesses in the areas any technical information, market 
research, or other forms of assistance, information, or advice 
that would be useful in alleviating or preventing conditions 
of excessive unemployment or underemployment in the areas. 
42 use 3193. 
"SEC. 503. CONSULTATION WITH OTHER PERSONS AND AGENCIES. 
"(a) CONSULTATION ON PROBLEMS RELATING TO EMPLOYMENT.— 
The Secretary may consult with any persons, including representa-
tives of labor, management, agriculture, and government, who can 
assist in addressing the problems of area and regional unemploy-
ment or underemployment. 
"(b) CONSULTATION ON ADMINISTRATION OF ACT.—The Secretary 
may provide for such consultation with interested Federal agencies 
as the Secretary determines to be appropriate in the performance 
of the duties of the Secretary under this Act. 
42 use 3194. 
"SEC. 504. ADMINISTRATION, OPERATION, AND MAINTENANCE. 
"The Secretary shall approve Federal assistance under this 
Act only if the Secretary is satisfied that the project for which 
Federal assistance is granted will be properly and efficiently 
administered, operated, and maintained. 
42 use 3195. 
"SEC. 505. BUSINESSES DESIRING FEDERAL CONTRACTS. 
"The Secretary may provide the procurement divisions of Fed-
eral agencies with a list consisting of— 
"(1) the names and addresses of businesses that are located 
in areas described in section 301(a) and that wish to obtain 
PUBLIC LAW 105-393—NOV. 13, 1998 
112 STAT. 3611 
Federal Government contracts for the provision of supplies 
or services; and 
"(2) the supplies and services that each business provides. 
"SEC. 506. PERFORMANCE EVALUATIONS OF GRANT RECIPIENTS. 
42 USC 3196. 
"(a) IN GENERAL.—^The Secretary shall conduct an evaluation 
of each university center and each economic development district 
that receives grant assistance under this Act (each referred to 
in this section as a 'grantee') to assess the grantee's performance 
and contribution toward retention and creation of employment. 
"(b) PURPOSE OF EVALUATIONS OF UNIVERSITY CENTERS.—^The 
purpose of the evaluations of university centers under subsection 
(a) shall be to determine which university centers are performing 
well and are worthy of continued grant assistance under this Act, 
and which should not receive continued assistance, so that univer-
sity centers that have not previously received assistance may receive 
assistance. 
"(c) TIMING OF EVALUATIONS.—Evaluations under subsection 
(a) shall be conducted on a continuing basis so that each grantee 
is evaluated within 3 years after the first award of assistance 
to the grantee after the effective date of the Economic Development 
Administration Reform Act of 1998, and at least once every 3 
years thereafter, so long as the grantee receives the assistance. 
"(d) EVALUATION CRITERIA.— 
"(1) ESTABLISHMENT.—^The Secretary shall estabhsh criteria 
for use in conducting evaluations under subsection (a). 
"(2) EVALUATION CRITERIA FOR UNIVERSITY CENTERS.—^The 
criteria for evaluation of a university center shall, at a mini-
mum, provide for an assessment of the center's contribution 
to providing technical assistance, conducting applied research, 
and disseminating results of the activities of the center. 
"(3) EVALUATION CRITERIA FOR ECONOMIC DEVELOPMENT 
DISTRICTS.—^The criteria for evaluation of an economic develop-
ment district shall, at a minimum, provide for an assessment 
of management standards, financial accountability, and pro-
gram performance. 
"(e) PEER REVIEW.—In conducting an evaluation of a university 
center or economic development district under subsection (a), the 
Secretary shall provide for the participation of at least 1 other 
university center or economic development district, as appropriate, 
on a cost-reimbursement basis. 
"SEC. 507. NOTIFICATION OF REORGANIZATION. 
Deadline. 
42 USC 3197 
"Not later than 30 days before the date of any reorganization 
of the offices, programs, or activities of the Economic Development 
Administration, the Secretary shall provide notification of the 
reorganization to the Committee on Environment and Public Works 
and the Committee on Appropriations of the Senate, and the 
Committee on Transportation and Infrastructure and the Commit-
tee on Appropriations of the House of Representatives. 
"TITLE VI—MISCELLANEOUS 
"SEC. 601. POWERS OF SECRETARY. 
42 USC 3211. 
"(a) IN GENERAL.—In carrying out the duties of the Secretary 
under this Act, the Secretary may— 
112 STAT. 3612 
PUBLIC LAW 105-393—NOV. 13, 1998 
Regulations. 
"(1) adopt, alter, and use a seal, which shall be judicially 
noticed; 
"(2) subject to the civil service and classification laws, 
select, employ, appoint, and fix the compensation of such 
personnel as are necessary to carry out this Act; 
"(3) hold such hearings, sit and act at such times and 
places, and take such testimony, as the Secretary determines 
to be appropriate; 
"(4) request directly, from any Federal agency, board, 
commission, office, or independent establishment, such informa-
tion, suggestions, estimates, and statistics as the Secretary 
determines to be necessary to carry out this Act (and each 
Federal agency, board, commission, office, or independent 
establishment may provide such information, suggestions, esti-
mates, and statistics directly to the Secretary); 
"(5) under regulations promulgated by the Secretary— 
"(A) assign or sell at public or private sale, or otherwise 
dispose of for cash or credit, in the Secretary's discretion 
and on such terms and conditions and for such consider-
ation as the Secretary determines to be reasonable, any 
evidence of debt, contract, claim, personal property, or secu-
rity assigned to or held by the Secretary in connection 
with assistance provided under this Act; and 
"(B) collect or compromise all obligations assigned to 
or held by the Secretary in connection with that assistance 
until such time as the obligations are referred to the Attor-
ney General for suit or collection; 
"(6) deal with, complete, renovate, improve, modernize, 
insure, rent, or sell for cash or credit, on such terms and 
conditions and for such consideration as the Secretary deter-
mines to be reasonable, any real or personal property conveyed 
to or otherwise acquired by the Secretary in connection with 
assistance provided under this Act; 
"(7) pursue to final collection, by means of compromise 
or other administrative action, before referral to the Attorney 
General, all claims against third parties assigned to the Sec-
retary in connection with assistance provided under this Act; 
"(8) acquire, in any lawful manner, any property (real, 
personal, or mixed, tangible or intangible), to the extent appro-
priate in connection with assistance provided under this Act; 
"(9) in addition to any powers, functions, privileges, and 
immunities otherwise vested in the Secretary, take any action, 
including the procurement of the services of attorneys by con-
tract, determined by the Secretary to be necessary or desirable 
in making, purchasing, servicing, compromising, modifying, liq-
uidating, or otherwise administratively dealing with assets held 
in connection with financial assistance provided under this 
Act; 
"(10)(A) employ experts and consultants or organizations 
as authorized by section 3109 of title 5, United States Code, 
except that contracts for such employment may be renewed 
annually; 
"(B) compensate individuals so employed, including com-
pensation for travel time; and 
"(C) allow individuals so employed, while away from their 
homes or regular places of business, travel expenses, including 
per diem in lieu of subsistence, as authorized by section 5703 
PUBLIC LAW 105-393—NOV. 13, 1998 
112 STAT. 3613 
of title 5, United States Code, for persons employed intermit-
tently in the Federal Government service; 
"(11) establish performance measures for grants and other 
assistance provided under this Act, and use the performance 
measures to evaluate the economic impact of economic develop-
ment assistance programs under this Act, which establishment 
and use of performance measures shall be provided by the 
Secretary through— 
"(A) officers or employees of the Department; 
"(B) the employment of persons under contracts 
entered into for such purposes; or 
"(C) grants to persons, using funds made available 
to carry out this Act; 
"(12) conduct environmental reviews and incur necesfeary 
expenses to evaluate and monitor the environmental impact 
of economic development assistance provided and proposed to 
be provided under this Act, including expenses associated with 
the representation and defense of the actions of the Secretary 
relating to the environmental impact of the assistance, using 
any funds made available to carry out section 207; 
"(13) sue and be sued in any court of record of a State 
having general jurisdiction or in any United States district 
court, except that no attachment, injunction, garnishment, or 
other similar process, mesne or final, shall be issued against 
the Secretary or the property of the Secretary; and 
"(14) establish such rules, regulations, and procedures as 
the Secretary considers appropriate for carrying out this Act. 
"(b) DEFICIENCY JUDGMENTS.—^The authority under subsection 
(a)(7) to pursue claims shall include the authority to obtain defi-
ciency judgments or otherwise pursue claims relating to mortgages 
assigned to the Secretary. 
"(c) INAPPLICABILITY OF CERTAIN OTHER REQUIREMENTS.—Sec-
tion 3709 of the Revised Statutes (41 U.S.C. 5) shall not apply 
to any contract of hazard insurance or to any purchase or contract 
for services or supplies on account of property obtained by the 
Secretary as a result of assistance provided under this Act if the 
premium for the insurance or the amount of the services or supplies 
does not exceed $1,000. 
"(d) PROPERTY INTERESTS.— 
"(1) IN GENERAL.—^The powers of the Secretary under this 
section, relating to property acquired by the Secretary in 
connection with assistance provided under this Act, shall extend 
to property interests of the Secretary relating to projects 
approved under— 
"(A) this Act* 
"(B) title I of the Public Works Employment Act of 
1976 (42 U.S.C. 6701 et seq.); 
"(C) title II of the Trade Act of 1974 (19 U.S.C. 2251 
et seq.); and 
"(D) the Community Emergency Drought Relief Act 
of 1977 (42 U.S.C. 5184 note; Public Law 95-31). 
"(2) RELEASE.—^The Secretary may release, in whole or 
in part, any real property interest, or tangible personal property 
interest, in connection with a grant after the date that is 
20 years after the date on which the grant was awarded. 
"(e) POWERS OF CONVEYANCE AND EXECUTION.—^The power to 
convey and to execute, in the name of the Secretary, deeds of 
112 STAT. 3614 
PUBLIC LAW 105-393—NOV. 13, 1998 
conveyance, deeds of release, assignments and satisfactions of mort-
gages, and any other written instrument relating to real or personal 
property or any interest in such property acquired by the Secretary 
under this Act may be exercised by the Secretary, or by any officer 
or agent appointed by the Secretary for that purpose, without 
the execution of any express delegation of power or power of attor-
ney. 
Deadline. 
"SEC. 603. ANNUAL REPORT TO CONGRESS. 
"Not later than July 1, 2000, and July 1 of each year thereafter, 
the Secretary shall submit to Congress a comprehensive and 
detailed annual report on the activities of the Secretary under 
this Act during the most recently completed fiscal year. 
42 u s e 3214. 
"SEC. 604. DELEGATION OF FUNCTIONS AND TRANSFER OF FUNDS 
AMONG FEDERAL AGENCIES. 
"(a) 
DELEGATION OF FUNCTIONS TO OTHER FEDERAL AGEN-
CIES.—The Secretary may— 
"(1) delegate to the heads of other Federal agencies such 
functions, powers, and duties of the Secretary under this Act 
as the Secretary determines to be appropriate; and 
"(2) authorize the redelegation of the functions, powers, 
and duties by the heads of the agencies. 
"(b) TRANSFER OF FUNDS TO OTHER FEDERAL AGENCIES.—Funds 
authorized to be appropriated to carry out this Act may be trans-
ferred between Federal agencies, if the funds are used for the 
purposes for which the funds are specifically authorized and appro-
priated. 
"(c) TRANSFER OF FUNDS FROM OTHER FEDERAL AGENCIES.— 
"(1) IN GENERAL.—Subject to paragraph (2), for the pur-
poses of this Act, the Secretary may accept transfers of funds 
from other Federal agencies if the funds are used for the 
purposes for which (and in accordance with the terms under 
which) the funds are specifically authorized and appropriated. 
"(2) USE OF FUNDS.—The transferred funds— 
"(A) shall remain available until expended; and 
"(B) may, to the extent necessary to carry out this 
Act, be transferred to and merged by the Secretary with 
the appropriations for salaries and expenses. 
42 u s e 3215. 
"SEC. 605. PENALTIES. 
"(a) FALSE STATEMENTS; SECURITY OVERVALUATION.—^A person 
that makes any statement that the person knows to be false, 
or willfully overvalues any security, for the purpose of— 
"(1) obtaining for the person or for any applicant any finan-
cial assistance under this Act or any extension of the assistance 
by renewal, deferment, or action, or by any other means, or 
the acceptance, release, or substitution of security for the assist-
ance; 
"(2) influencing in any manner the action of the Secretary; 
or 
"(3) obtaining money, property, or any thing of value, under 
this Act; 
shall be fined under title 18, United States Code, imprisoned not 
more than 5 years, or both. 
"(b) EMBEZZLEMENT AND FRAUD-RELATED CRIMES.—^A person 
that is connected in any capacity with the Secretary in the adminis-
tration of this Act and that— 
PUBLIC LAW 105-393—NOV. 13, 1998 
112 STAT. 3615 
"(1) embezzles, abstracts, purloins, or willfully misapplies 
any funds, securities, or other thing of value, that is pledged 
or otherwise entrusted to the person; 
"(2) with intent to defraud the Secretary or any other 
person or entity, or to deceive any officer, auditor, or exam-
iner— 
"(A) makes any false entry in any book, report, or 
statement of or to the Secretary; or 
"(B) without being duly authorized, draws any order 
or issue, puts forth, or assigns any note, debenture, bond, 
or other obligation, or draft, bill of exchange, mortgage, 
judgment, or decree thereof; 
"(3) with intent to defraud, participates or shares in or 
receives directly or indirectly any money, profit, property, or 
benefit through any transaction, loan, grant, commission, con-
tract, or any other act of the Secretary; or 
"(4) gives any unauthorized information concerning any 
future action or plan of the Secretary that might affect the 
value of securities, or having such knowledge invests or specu-
lates, directly or indirectly, in the securities or property of 
any company or corporation receiving loans, grants, or other 
assistance from the Secretary; 
shall be fined under title 18, United States Code, imprisoned not 
more than 5 years, or both. 
"SEC. 606. EMPLOYMENT 
OF EXPEDITERS AND ADMINISTRATIVE 
42USC3216. 
EMPLOYEES. 
"Assistance shall not be provided by the Secretary under this 
Act to any business unless the owners, partners, or officers of 
the business— 
"(1) certify to the Secretary the names of any attorneys. Certification, 
agents, and other persons engaged by or on behalf of the 
business for the purpose of expediting applications made to 
the Secretary for assistance of any kind, under this Act, and 
the fees paid or to be paid to the person for expediting the 
applications; and 
"(2) execute an agreement binding the business, for the 
2-year period beginning on the date on which the assistance 
is provided by the Secretary to the business, to refrain from 
employing, offering any office or employment to, or retaining 
for professional services, any person who, on the date on which 
the assistance or any part of the assistance was provided, 
or within the 1-year period ending on that date— 
"(A) served as an officer, attorney, agent, or employee 
of the Department; and 
"(B) occupied a position or engaged in activities that 
the Secretary determines involved discretion with respect 
to the granting of assistance under this Act. 
"SEC. 607. MAINTENANCE AND PUBLIC INSPECTION OF LIST OF 
APPROVED APPLICATIONS FOR FINANCIAL ASSISTANCE. 
"(a) IN GENERAL.—^The Secretary shall— 
"(1) maintain as a permanent part of the records of the 
Department a list of applications approved for financial assist-
ance under this Act; and 
"(2) make the list available for public inspection during 
the regular business hours of the Department. 
Records. 
42 use 3217. 
112 STAT. 3616 
PUBLIC LAW 105-393—NOV. 13, 1998 
"(b) ADDITIONS TO LIST.—The following information shall be 
added to the list maintained under subsection (a) as soon as an 
application described in subsection (a)( 1) is approved: 
"(1) The name of the applicant and, in the case of a cor-
porate application, the name of each officer and director of 
the corporation. 
"(2) The amount and duration of the financial assistance 
for which application is made. 
"(3) The purposes for which the proceeds of the financial 
assistance are to be used. 
42 use 3218. 
"SEC. 608. RECORDS AND AUDITS. 
"(a) RECORDKEEPING AND DISCLOSURE REQUIREMENTS.—Each 
recipient of assistance under this Act shall keep such records as 
the Secretary shall require, including records that fully disclose— 
"(1) the amount and the disposition by the recipient of 
the proceeds of the assistance; 
"(2) the total cost of the project in connection with which 
the assistance is given or used; 
"(3) the amount and nature of the portion of the cost 
of the project provided by other sources; and 
"(4) such other records as will facilitate an effective audit. 
"(b) ACCESS TO BOOKS FOR EXAMINATION AND AUDIT.—^The Sec-
retary, the Inspector General of the Department, and the Comptrol-
ler General of the United States, or any duly authorized representa-
tive, shall have access for the purpose of audit and examination 
to any books, documents, papers, and records of the recipient that 
relate to assistance received under this Act. 
42 use 3219. 
"SEC 609. RELATIONSHIP TO ASSISTANCE UNDER OTHER LAW. 
"(a) PREVIOUSLY AUTHORIZED ASSISTANCE.—Except as other-
wise provided in this Act, all financial and technical assistance 
authorized under this Act shall be in addition to any Federal 
assistance authorized before the effective date of the Economic 
Development Administration Reform Act of 1998. 
"(b) ASSISTANCE UNDER OTHER ACTS.—Nothing in this Act 
authorizes or permits any reduction in the amount of Federal assist-
ance that any State or other entity eligible under this Act is 
entitled to receive under any other Act. 
"SEC. 610. ACCEPTANCE OF CERTIFICATIONS BY APPLICANTS. 
"Under terms and conditions determined by the Secretary, the 
Secretary may accept the certifications of an applicant for assistance 
under this Act that the applicant meets the requirements of this 
Act.". 
(b) TITLE VII.—^The Public Works and Economic Development 
Act of 1965 (42 U.S.C. 3121 et seq.) is amended— 
42 use 3222, 
(1) by redesignating section 712 as section 602 and moving 
3212. 
that section to appear after section 601 (as amended by sub-
section (a)); 
42 use 3212. 
(2) in section 602 (as added by paragraph (1))— 
(A) by striking the section heading and all that follows 
through "All" and inserting the following: 
"SEC. 602. MAINTENANCE OF STANDARDS. 
"All"; and 
(B) by striking "sections 101, 201, 202, 403, 903, and 
1003" and inserting "this Act"; and 
PUBLIC LAW 105-393—NOV. 13, 1998 
112 STAT. 3617 
(3) by striking title VII (as amended by paragraph (1)) 42USC32lle< 
and inserting the following: 
-^eq. 
"TITLE VII—FUNDING 
"SEC. 701. GENERAL AUTHORIZATION OF APPROPRIATIONS. 
42 USC 3231. 
"There are authorized to be appropriated to carry out this 
Act $397,969,000 for fiscal year 1999, $368,000,000 for fiscal year 
2000, $335,000 000 for fiscal year 2001, $335,000,000 for fiscal 
year 2002, and $335,000,000 for fiscal year 2003, to remain available 
until expended. 
"SEC. 702. AUTHORIZATION OF APPROPRIATIONS FOR DEFENSE 
42 USC 3232. 
CONVERSION ACTIVITIES. 
"(a) I N GENERAL.—In addition to amounts made available under 
section 701, there are authorized to be appropriated such sums 
as are necessary to carry out section 209(c)(1), to remain available 
until expended. 
"(b) PILOT PROJECTS.—Funds made available under subsection 
(a) may be used for activities including pilot projects for privatiza-
tion of, and economic development activities for, closed or realigned 
military or Department of Energy installations. 
"SEC. 703. AUTHORIZATION OF APPROPRIATIONS FOR DISASTER ECO- 42 USC 3233. 
NOMIC RECOVERY ACTIVITIES. 
"(a) I N GENERAL.—In addition to amounts made available under 
section 701, there are authorized to be appropriated such sums 
as are necessary to carry out section 209(c)(2), to remain available 
until expended. 
"(b) FEDERAL SHARE.—The Federal share of the cost of activities 
funded with amounts made available under subsection (a) shall 
be up to 100 percent.". 
(c) TITLES VIII THROUGH X.—The Public Works and Economic 
Development Act of 1965 is amended by striking titles VIII through 
X(42U.S.C. 3231etseq.). 
SEC. 103. CONFORMING AMENDMENT. 
Section 5316 of title 5, United States Code, is amended by 
striking "Administrator for Economic Development.". 
SEC. 104. TRANSITION PROVISIONS. 
42 USC 3121 
(a) EXISTING RIGHTS, DUTIES, AND OBLIGATIONS.—^This title, 
including the amendments made by this title, does not affect the 
validity of any right, duty, or obligation of the United States or 
any other person arising under any contract, loan, or other 
instrument or agreement that was in effect on the day before 
the effective date of this title. 
(b) CONTINUATION OF SuiTS.—No action or other proceeding 
commenced by or against any officer or employee of the Economic 
Development Administration shall abate by reason of the enactment 
of this title. 
(c) LIQUIDATING ACCOUNT.—^The Economic Development Revolv-
ing Fund established under section 203 of the Public Works and 
Economic Development Act of 1965 (42 U.S.C. 3143) (as in effect 
on the day before the effective date of this title) shall continue 
to be available to the Secretary of Commerce as a liquidating 
account (as defined in section 502 of the Federal Credit Reform 
112 STAT. 3618 
PUBLIC LAW 105^393—NOV. 13, 1998 
Act of 1990 (2 U.S.C. 661a)) for payment of obligations and expenses 
in connection with financial assistance provided under— 
(1) the Public Works and Economic Development Act of 
1965 (42 U.S.C. 3121 et seq.); 
(2) the Area Redevelopment Act (42 U.S.C. 2501 et seq.); 
and 
(3) the Trade Act of 1974 (19 U.S.C. 2101 et seq.). 
(d) ADMINISTRATION.—The Secretary of Commerce shall take 
such actions authorized before the effective date of this title as 
are appropriate to administer and liquidate grants, contracts, agree-
ments, loans, obligations, debentures, or guarantees made by the 
Secretary under law in effect before the effective date of this title. 
42 use 3121 
SEC.105. EFFECTIVE DATE. 
This title and the amendments made by this title shall take 
effect on a date determined by the Secretary of Commerce, but 
not later than 90 days after the date of enactment of this Act. 
Appalachian 
TITLE II—APPALACHIAN REGIONAL 
SS^ment 
DEVELOPMENT 
Reform Act of 
loUSCapp.l 
SEC. 201. SHORT TITLE. 
"°*®- 
This title may be cited as the "Appalachian Regional Develop-
ment Reform Act of 1998". 
SEC. 202. FINDINGS AND PURPOSES. 
Section 2 of the Appalachian Regional Development Act of 
1965 (40 U.S.C. App.) is amended by adding at the end the following: 
"(c) 1998 FINDINGS AND PURPOSES.— 
"(1) FINDINGS.—Congress further finds and declares that, 
while substantial progress has been made in fulfilling many 
of the objectives of this Act, rapidly changing national and 
global economies over the past decade have created new prob-
lems and challenges for rural areas throughout the United 
States and especially for the Appalachian region. 
"(2) PURPOSES.—In addition to the purposes stated in sub-
sections (a) and (b), it is the purpose of this Act— 
"(A) to assist the Appalachian region in— 
"(i) providing the infrastructure necessary for eco-
nomic and human resource development; 
"(ii) developing the region's industry; 
"(iii) building entrepreneurial communities; 
"(iv) generating a diversified regional economy; and 
"(v) making the region's industrial and commercial 
resources more competitive in national and world mar-
kets; 
"(B) to provide a framework for coordinating Federal, 
State, and local initiatives to respond to the economic 
competitiveness challenges in the Appalachian region 
through— 
"(i) improving the skills of the region's workforce; 
"(ii) adapting and applying new technologies for 
the region's businesses; and 
"(iii) 
improving 
the 
access 
of the 
region's 
businesses to the technical and financial resources nec-
essary to development of the businesses; and 
PUBLIC LAW 105-393—NOV. 13, 1998 
112 STAT. 3619 
"(C) to address the needs of severely and persistently 
distressed areas of the Appalachian region and focus special 
attention on the areas of greatest need so as to provide 
a fairer opportunity for the people of the region to share 
the quality of life generally enjoyed by citizens across the 
United States.". 
SEC. 203. MEETINGS. 
(a) 
ANNUAL 
MEETING 
REQUIREMENT.—Section 
101 
of 
the 
Appalachian Regional Development Act of 1965 (40 U.S.C. App.) 
is amended— 
(1) by striking "(a) There" and inserting the following: • 
"(a) IN GENERAL.— 
"(1) ESTABLISHMENT.—There"; and 
(2) by adding at the end the following: 
"(2) MEETINGS.— 
"(A) IN GENERAL.—^The Commission shall conduct at 
least 1 meeting each year with the Federal Cochairman 
and at least a majority of the State members present.". 
(b) ADDITIONAL MEETINGS BY ELECTRONIC MEANS.—Section 101 
of the Appalachian Regional Development Act of 1965 (40 U.S.C. 
App.) is amended— 
(1) in subsection (a)(2) (as added by subsection (a)(2)), 
by adding at the end the following: 
"(B) ADDITIONAL MEETINGS.—^The Commission may 
conduct such additional meetings by electronic means as 
the Commission considers advisable, including meetings 
to decide matters requiring an affirmative vote."; and 
(2) in the fourth sentence of subsection (c), by striking 
"to be present". 
(c) DECISIONS REQUIRING A QUORUM.—Section 101(b) of the 
Appalachian Regional Development Act of 1965 (40 U.S.C. App.) 
is amended by striking the third sentence and inserting the follow-
ing: "A decision involving Commission policy, approval of any State, 
regional, or subregional development plan or implementing invest-
ment program, any modification or revision of the Appalachian 
Regional Commission Code, any allocation of funds among the 
States, or any designation of a distressed county or an economically 
strong county shall not be made without a quorum of the State 
members.". 
SEC. 204. ADMINISTRATIVE EXPENSES. 
Section 105 of the Appalachian Regional Development Act of 
1965 (40 U.S.C. App.) is amended— 
(1) by striking "(a) For the period" in the first sentence 
and all that follows through "such expenses" in the second 
sentence and 
inserting "Administrative 
expenses of the 
Commission"; and 
(2) by striking subsection (b). 
SEC. 
205. 
COMPENSATION 
OF 
EMPLOYEES. 
Section 106(2) of the Appalachian Regional Development Act 
of 1965 (40 U.S.C. App.) is amended by striking "the salary of 
the alternate to the Federal Cochairman on the Commission as 
provided in section 101" and inserting "the maximum rate of basic 
pay for the Senior Executive Service under section 5382 of title 
112 STAT. 3620 
PUBLIC LAW 105-393—NOV. 13, 1998 
5, United States Code, including any applicable locality-based com-
parability 
payment 
that 
may 
be 
authorized 
under 
section 
5304(h)(2)(C) of that title". 
SEC. 206. ADMINISTRATIVE POWERS OF COMMISSION. 
Section 106(7) of the Appalachian Regional Development Act 
of 1965 (40 U.S.C. App.) is amended by striking "1982" and inserting 
"2001". 
SEC. 207. COST SHARING OF DEMONSTRATION HEALTH PROJECTS. 
(a) OPERATION COSTS.—Section 202(c) of the Appalachian 
Regional Development Act of 1965 (40 U.S.C. App.) is amended 
by striking "100 per centum of the costs thereof in the first sentence 
and all that follows through the period at the end of the second 
sentence and inserting "50 percent of the costs of that operation 
(or 80 percent of those costs in the case of a project to be carried 
out in a county for which a distressed county designation is in 
effect under section 226).". 
(b) COST SHARING.—Section 202 of the Appalachian Regional 
Development Act of 1965 (40 U.S.C. App.) is amended by adding 
at the end the following: 
"(f) MAXIMUM COMMISSION CONTRIBUTION AFTER SEPTEMBER 
30, 1998.— 
"(1) IN GENERAL.—Subject to paragraph (2), after Septem-
ber 30, 1998, a Commission contribution of not more than 
50 percent of any project cost eligible for financial assistance 
under this section may be provided from funds appropriated 
to carry out this Act. 
"(2) DISTRESSED COUNTIES.—In the case of a project to 
be carried out in a county for which a distressed county designa-
tion is in effect under section 226, the maximum Commission 
contribution under paragraph (1) may be increased to the lesser 
of— 
"(A) 80 percent; or 
"(B) the maximum Federal contribution percentage 
authorized by this section.". 
(c) TECHNICAL AMENDMENTS.—Section 202 of the Appalachian 
Regional Development Act of 1965 (40 U.S.C. App.) is amended— 
(1) by striking "Secretary of Health, Education, and Wel-
fare" each place it appears and inserting "Secretary of Health 
and Human Services"; and 
(2) in subsection (c), by striking the last sentence. 
SEC. 208. REPEAL OF LAND STABILIZATION, CONSERVATION, AND 
EROSION CONTROL PROGRAM. 
Section 203 of the Appalachian Regional Development Act of 
1965 (40 U.S.C. App.) is repealed. 
SEC. 209. REPEAL OF TIMBER DEVELOPMENT PROGRAM. 
Section 204 of the Appalachian Regional Development Act of 
1965 (40 U.S.C. App.) is repealed. 
SEC. 210. REPEAL OF MINING AREA RESTORATION PROGRAM. 
Section 205 of the Appalachian Regional Development Act of 
1965 (40 U.S.C. App.) is repealed. 
SEC. 
2
1
1
. 
REPEAL 
OF 
WATER 
RESOURCE 
SURVEY. 
Section 206 of the Appalachian Regional Development Act of 
1965 (40 U.S.C. App.) is repealed. 
PUBLIC LAW 105-393—NOV. 13, 1998 
112 STAT. 3621 
SEC. 212. COST SHARING OF HOUSING PROJECTS. 
(a) LOANS.—Section 207(b) of the Appalachian 
Regional 
Development Act of 1965 (40 U.S.C. App.) is amended in the first 
sentence by striking "80 per centum" and inserting "50 percent 
(or 80 percent in the case of a project to be carried out in a 
county for which a distressed county designation is in effect under 
section 226)". 
(b) GRANTS.—Section 207(c)(1) of the Appalachian Regional 
Development Act of 1965 (40 U.S.C. App.) is amended by striking 
"80 per centum" and inserting "50 percent (or 80 percent in the 
case of a project to be carried out in a county for which a distressed 
county designation is in effect under section 226)". 
SEC. 213. REPEAL OF AIRPORT SAFETY IMPROVEMENTS PROGRAM. 
Section 208 of the Appalachian Regional Development Act of 
1965 (40 U.S.C. App.) is repealed. 
SEC. 214. COST SHARING OF VOCATIONAL EDUCATION AND EDU-
CATION DEMONSTRATION PROJECTS. 
(a) OPERATION COSTS.—Section 211(b)(3) of the Appalachian 
Regional Development Act of 1965 (40 U.S.C. App.) is amended 
by striking "100 per centum of the costs thereof in the first sentence 
and all that follows through the period at the end of the second 
sentence and inserting "50 percent of the costs of that operation 
(or 80 percent of those costs in the case of a project to be carried 
out in a county for which a distressed county designation is in 
effect under section 226).". 
(b) COST SHARING.—Section 211 of the Appalachian Regional 
Development Act of 1965 (40 U.S.C. App.) is amended by adding 
at the end the following: 
"(c) MAXIMUM COMMISSION CONTRIBUTION AFTER SEPTEMBER 
30, 1998.— 
"(1) IN GENERAL.—Subject to paragraph (2), after Septem-
ber 30, 1998, a Commission contribution of not more than 
50 percent of any project cost eligible for financial assistance 
under this section may be provided from funds appropriated 
to carry out this Act. 
"(2) DISTRESSED COUNTIES.—In the case of a project to 
be carried out in a county for which a distressed county designa-
tion is in effect under section 226, the maximum Commission 
contribution under paragraph (1) may be increased to the lesser 
of— 
"(A) 80 percent; or 
"(B) the maximum Federal contribution percentage 
authorized by this section.". 
(c) TECHNICAL AMENDMENTS.—Section 211 of the Appalachian 
Regional Development Act of 1965 (40 U.S.C. App.) is amended— 
(1) in subsection (a), by striking "Secretary of Health, Edu-
cation, and Welfare" and inserting "Secretary of Education"; 
and 
(2) in subsection (b)— 
(A) in paragraph (1), by striking "Secretary of the 
Department of Health, Education, and Welfare" and insert-
ing "Secretary of Education"; and 
(B) in paragraph (3), by striking the last sentence. 
112 STAT. 3622 
PUBLIC LAW 105-393—NOV. 13, 1998 
SEC. 215. REPEAL OF SEWAGE TREATMENT WORKS PROGRAM. 
Section 212 of the Appalachian Regional Development Act of 
1965 (40 U.S.C. App.) is repealed. 
SEC. 216. REPEAL OF AMENDMENTS TO HOUSING ACT OF 1954. 
Section 213 of the Appalachian Regional Development Act of 
1965 (40 U.S.C. App.) is repealed. 
SEC. 217. SUPPLEMENTS TO FEDERAL GRANT-IN-AID PROGRAMS. 
(a) AVAILABILITY OF AMOUNTS.—Section 214(a) of the Appalach-
ian Regional Development Act of 1965 (40 U.S.C. App.) is amended 
in the first sentence by striking "the President is authorized to 
provide funds to the Federal Cochairman to be used" and inserting 
"the Federal Cochairman may use amounts made available to carry 
out this section". 
(b) COST SHARING.—Section 214(b) of the Appalachian Regional 
Development Act of 1965 (40 U.S.C. App.) is amended— 
(1) by striking "(b) The Federal" and inserting the following: 
"(b) COST SHARING.— 
"(1) IN GENERAL.—The Federal"; and 
(2) by adding at the end the following: 
"(2) MAXIMUM COMMISSION CONTRIBUTION AFTER SEPTEM-
BER 30, 1998.— 
"(A) IN GENERAL.—Subject to subparagraph (B), after 
September 30, 1998, a Commission contribution of not more 
than 50 percent of any project cost eligible for financial 
assistance under this section may be provided from funds 
appropriated to carry out this Act. 
"(B) DISTRESSED COUNTIES.—In the case of a project 
to be carried out in a county for which a distressed county 
designation is in effect under section 226, the maximum 
Commission contribution under subparagraph (A) may be 
increased to 80 percent.". 
(c) DEFINITION OF FEDERAL GRANT-IN-AID PROGRAMS.— Section 
214(c) of the Appalachian Regional Development Act of 1965 (40 
U.S.C. App.) is amended in the first sentence— 
(1) by striking "on or before December 31, 1980,"; and 
(2) by striking "Titles I and IX of the Public Works and 
Economic Development Act of 1965" and inserting "sections 
201 and 209 of the Public Works and Economic Development 
Act of 1965". 
(d) LIMITATION ON COVERED ROAD PROJECTS.—Section 214(c) 
of the Appalachian Regional Development Act of 1965 (40 U.S.C. 
App.) is amended in the second sentence by inserting "authorized 
by title 23, United States Code" after "road construction". 
SEC. 218. PROGRAM DEVELOPMENT CRITERIA. 
(a) CONSIDERATIONS.—Section 224(a)(1) of the Appalachian 
Regional Development Act of 1965 (40 U.S.C. App.) is amended 
by inserting before the semicolon at the end the following: "or 
in a severely and persistently distressed county or area". 
(b) OUTCOME MEASUREMENTS.—Section 224(a) of the Appalach-
ian Regional Development Act of 1965 (40 U.S.C. App.) is amend-
ed— 
(1) in paragraph (5), by striking the period at the end 
and inserting "; and"; and 
(2) by adding at the end the following: 
PUBLIC LAW 105-393—NOV. 13, 1998 
112 STAT. 3623 
"(6) the extent to which the project design provides for 
detailed outcome measurements by which grant expenditures 
may be evaluated.". 
(c) REMOVAL OF LIMITATIONS.—Section 224 of the Appalachian 
Regional Development Act of 1965 (40 U.S.C. App.) is amended 
by striking subsection (b) and inserting the following: 
"(b) LIMITATION.—Financial assistance made available under 
this Act shall not be used to assist establishments relocating from 
one area to another.". 
(d) 
CONFORMING 
AMENDMENT.—Section 
302(b)(1) 
of 
the 
Appalachian Regional Development Act of 1965 (40 U.S.C. App.) 
is amended in the first sentence by striking "Notwithstanding" 
and all that follows through "the Commission" and inserting "The 
Commission". 
SEC. 219. DISTRESSED AND ECONOMICALLY STRONG COUNTIES. 
Part C of title II of the Appalachian Regional Development 
Act of 1965 (40 U.S.C. App.) is amended by adding at the end 
the following: 
"SEC. 226. DISTRESSED AND ECONOMICALLY STRONG COUNTIES. 
"(a) DESIGNATIONS.— 
"(1) IN GENERAL.—^Not later than 90 days after the date Deadline, 
of enactment of this section, and annually thereafter, the 
Commission, in accordance with such criteria as the Commis-
sion may establish, shall— 
"(A) designate as 'distressed counties' those counties 
in the region that are the most severely and persistently 
distressed; and 
"(B) designate 2 categories of economically strong coun-
ties, consisting of— 
"(i) 'competitive counties', which shall be those 
counties in the region that are approaching economic 
parity with the rest of the United States; and 
"(ii) 'attainment counties', which shall be those 
counties in the region that have attained or exceeded 
economic parity with the rest of the United States. 
"(2) ANNUAL REVIEW OF DESIGNATIONS.—The Commission 
shall— 
"(A) conduct an annual review of each designation 
of a county under paragraph (1) to determine if the county 
still meets the criteria for the designation; and 
"(B) renew the designation for another 1-year period 
only if the county still meets the criteria. 
"(b) DISTRESSED COUNTIES.—In program and project develop-
ment and implementation and in the allocation of appropriations 
made available to carry out this Act, the Commission shall give 
special consideration to the needs of those counties for which a 
distressed county designation is in effect under this section. 
"(c) ECONOMICALLY STRONG COUNTIES.— 
"(1) COMPETITIVE COUNTIES.—Except as provided in para-
graphs (3) and (4), in the case of a project that is carried 
out in a county for which a competitive county designation 
is in effect under this section, assistance under this Act shall 
be limited to not more than 30 percent of the project cost. 
"(2) ATTAINMENT COUNTIES.—Except as provided in para-
graphs (3) and (4), no funds may be provided under this Act 
59-194 O - 98 - 28: QL 3 Part 5 
112 STAT. 3624 
PUBLIC LAW 105-393—NOV. 13, 1998 
for a project that is carried out in a county for which an 
attainment county designation is in effect under this section. 
"(3) EXCEPTIONS.—^The requirements of paragraphs (1) and 
(2) shall not apply to— 
"(A) any project on the Appalachian development high-
way system authorized by section 201; 
"(B) any local development district administrative 
project assisted under section 302(a)(1); or 
"(C) any multicounty project that is carried out in 
2 or more counties designated under this section if— 
"(i) at least 1 of the participating counties is des-
ignated as a distressed county under this section; and 
"(ii) the project will be of substantial direct benefit 
to 1 or more distressed counties. 
"(4) WAIVER.— 
"(A) IN GENERAL.—^The Commission may waive the 
requirements of paragraphs (1) and (2) for a project upon 
a showing by the recipient of assistance for the project 
of 1 or more of the following: 
"(i) The existence of a significant pocket of distress 
in the part of the county in which the project is carried 
out. 
"(ii) The existence of a significant potential benefit 
from the project in 1 or more areas of the region 
outside the designated county. 
"(B) REPORTS TO CONGRESS.—The Commission shall 
submit to the Committee on Environment and Public Works 
of the Senate and the Committee on Transportation and 
Infrastructure of the House of Representatives an annual 
report describing each waiver granted under subparagraph 
(A) during the period covered by the report.". 
SEC. 220. GRANTS FOR ADMINISTRATIVE EXPENSES AND COMMIS-
SION PROJECTS. 
(a) AVAILABILITY OF AMOUNTS.—Section 302(a) of the Appalach-
ian Regional Development Act of 1965 (40 U.S.C. App.) is amend-
ed— 
(1) by striking "The President" and inserting "The Commis-
sion"; and 
(2) in paragraphs (1), (2), and (3), by striking "to the 
Commission" each place it appears. 
(b) COST SHARING.—Section 302(a) of the Appalachian Regional 
Development Act of 1965 (40 U.S.C. App.) is amended— 
(1) in paragraph (1)— 
(A) in subparagraph (A), by striking "75 per centum" 
and inserting "50 percent"; and 
(B) by redesignating subparagraphs (A), (B), and (C) 
as clauses (i), (ii), and (iii), respectively; 
(2) by redesignating paragraphs (1), (2), and (3) as subpara-
graphs (A), (B), and (C), respectively; 
(3) by striking "(a) The" and inserting the following: 
"(a) AUTHORIZATION TO MAKE GRANTS.— 
"(1) IN GENERAL.—The"; 
(4) by adjusting the margins of subparagraphs (A), (B), 
and (C) (as redesignated by paragraph (2)) to reflect the amend-
ment made by paragraph (3); and 
(5) by adding at the end the following: 
PUBLIC LAW 105-393—NOV. 13, 1998 
112 STAT. 3625 
"(2) COST SHARING AFTER SEPTEMBER 3O, I998.— 
"(A) IN GENERAL.—Except as provided in subparagraph 
(B), after September 30, 1998, not more than 50 percent 
(or 80 percent in the case of a project to be carried out 
in a county for which a distressed county designation is 
in effect under section 226) of the costs of any activity 
ehgible for financial assistance under this section may be 
provided from funds appropriated to carry out this Act. 
"(B) DISCRETIONARY GRANTS.— 
"(i) IN GENERAL.—Discretionary grants made by 
the Commission to implement significant regional ini-
tiatives, to take advantage of special development 
opportunities, or to respond to emergency economic 
distress in the region may be made without regard 
to the percentage limitations specified in subparagraph 
(A). 
"(ii) LIMITATION ON AGGREGATE AMOUNT.—For each 
fiscal year, the aggregate amount of discretionary 
grants referred to in clause (i) shall not exceed 10 
percent of the amounts appropriated under section 401 
for the fiscal year.". 
(c) CONFORMING AND TECHNICAL AMENDMENTS.— 
(1) Section 302 of the Appalachian Regional Development 
Act of 1965 (40 U.S.C. App.) is amended— 
(A) in subsection (b)— 
(i) in paragraph (2), by striking "Federal Energy 
Administration, the Energy Research and Development 
Administration" and inserting "Secretary of Energy"; 
and 
(ii) by striking paragraphs (3) and (4); and 
(B) by striking subsections (d) and (e). 
(2) Section 210(a) of title 35, United States Code, is amend-
ed— 
(A) by striking paragraph (11); and 
(B) by redesignating paragraphs (12) through (22) as 
paragraphs (11) through (21), respectively. 
SEC. 221. AUTHORIZATION OF APPROPRIATIONS FOR GENERAL PRO-
GRAM. 
Section 401 of the Appalachian Regional Development Act of 
1965 (40 U.S.C. App.) is amended to read as follows: 
"SEC. 401. AUTHORIZATION OF APPROPRIATIONS. 
"(a) IN GENERAL.—In addition to amounts authorized by section 
201 and other amounts made available for the Appalachian develop-
ment highway system program, there are authorized to be appro-
priated to the Commission to carry out this Act— 
"(1) $68,000,000 for fiscal year 1999; 
"(2) $69,000,000 for fiscal year 2000; and 
"(3) $70,000,000 for fiscal year 2001. 
"(b) AVAILABILITY.—Sums made available under subsection (a) 
shall remain available until expended.". 
SEC. 222. EXTENSION OF TERMINATION DATE. 
Section 405 of the Appalachian Regional Development Act of 
1965 (40 U.S.C. App.) is amended by striking "1982" and inserting 
"2001". 
112 STAT. 3626 
PUBLIC LAW 105-393—NOV. 13, 1998 
SEC. 223. TECHNICAL AMENDMENT. 
Section 5334(a) of title 5, United States Code, is amended 
in the second sentence by striking "title 40, appendix, or by a 
regional commission established pursuant to section 3182 of title 
42, under section 3186(a)(2) of that title" and inserting "the 
Appalachian Regional Development Act of 1965 (40 U.S.C. App.)". 
Approved November 13, 1998. 
LEGISLATIVE HISTORY—S. 2364: 
SENATE REPORTS: No. 105-332 (Comm. on Environment and Public Works). 
CONGRESSIONAL RECORD, Vol. 144 (1998): 
Oct. 12, considered and passed Senate. 
Oct. 13, considered and passed House. 
WEEKLY COMPILATION OF PRESIDENTIAL DOCUMENTS, Vol. 34 (1998): 
Nov. 13, Presidential statement.