National Association of Regional Councils

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U. S. Departments of Commerce and Housing and Urban Development

To obtain this document in PDF form, please click here

Issues: The Bush Administration’s FY 2007 Congressional Budget Request includes the implementation of an amended version of the Strengthening America’s Communities Initiative (SACI). SACI calls for changes to the economic development programs of the Economic Development Administration (EDA) and the Community Development Block Grant (CDBG) program. It consolidates 17 federal programs.

Implementation of the newest set of regulations for the Economic Development Administration (EDA) is important, especially for regional and other economic development organizations. Regulations will be fully implemented in 2006 in response to enacted reauthorization legislation for EDA.

Background: Economic development and community development programs under the Commerce and Housing and Urban Development Departments and 17 other federal programs are included for consolidation in the Administration’s Fiscal Year 2007 Congressional Budget Request as a part of SACI. The joint goal for EDA and CDBG is to develop performance standards for economic development programs as a basis for implementation of the SACI. The 2007 Budget Request includes an increase of $43 million for EDA for a total budget request of $327.1 million. The CDBG program administered by the U. S. Department of Housing and Urban Development received a decrease of $775 million to $2.97 billion. The programs included in the FY 2007 Budget Request for consolidation include:

Department of Agriculture
 - Rural Business Enterprise Grants/Opportunity Grants 
 - Economic Impact Grants 
 - Rural Empowerment Zones/Enterprise Communities

Department of Commerce
 - Economic Development Assistance Programs

Department of Health and Human Services
 - Community and Economic Development
 - Rural Community Facilities

Department of Housing and Urban Development
 - Community Development Block Grant Formula Grants
 - National Community Development Initiative
 - CDBG Set-Asides
 - Brownfields Economic Development Initiative
 - Rural Housing and Economic Development
 - Urban Empowerment Zones Round II Grants
 - Community Development Loan Guarantees (Section 108)

Department of the Treasury Community Development Financial Institutions Program
 - Bank Enterprise Award (BEA) Program
 - CDFI Native Initiatives

The EDA and CDBG programs are an invaluable resource to the nation’s communities as they have moved to implement regional strategies that promote innovation and global competitiveness. Continuance of these programs is critical to sustain the nation’s posture in the world economy. Recommendations: The National Association of Regional Councils (NARC) urges Congress to recognize the contributions that EDA has made to economic revitalization and to reward the agency with a funding level that will provide sufficient program and operations resources, including state of the art communications and information technology, at all levels of the agency. NARC also urges Congress to: 

• Provide appropriations for EDA and CDBG programs commensurate with authorization levels or with FY 2006 appropriated levels at a minimum; 
• Support the operations of economic development districts, the backbone of EDA since the agency’s inception by increasing planning funds to keep pace with inflation and fund designated districts; 
• Monitor the implementation of regulations promulgated in compliance with EDA’s reauthorization;
• Identify other funding opportunities for EDA that support the preservation and creation of critical infrastructure needed for economic development or to protect the homeland; and 
• Assure the continuance of the mission and program activities of EDA and CDBG.

NARC Policy: NARC supports the continuation of the core programs of the Economic Development Administration and the agency’s long-standing relationship with economic development districts. NARC also supports funding that is at least commensurate with authorization levels for EDA. NARC supports funding that is consistent with FY 2006 appropriated levels for CDBG, at a miniumum. NARC supports performance criteria for programs developed through a collaborative process with practitioners and stakeholders.