Switch to Full View
Tuesday, March 13, 2018

Federal Alert: We need your help – sign our letter supporting EDA!

posted by: Matthew Mullin

Thank you to those organizations that have signed onto our letter so far. There’s still time to add your voice – and we need your voice added! – in support of the Economic Development Administration.  Here’s what you need to know:

  • EDA has been marked for elimination, again, in the fiscal 2019 White House Budget proposal
  • EDA wasn’t even mentioned – at all – in the Department of Commerce’s five year strategic plan released last week
  • EDA received a $100 million cut in funding in their House appropriations bill for the current fiscal year

To be brief: EDA remains under attack, despite receiving broad, bipartisan support in Congress in the recent debate over disaster recovery funding. $600 million worth of bipartisan support, in fact. EDA needs our support today and tomorrow and for the foreseeable future.

Click the link below and add your organization to the growing list of supporters. Help us share the message that economic developers want a strong, robustly funded economic development agency. In the weeks and months ahead, IEDC will continue to engage Congress as we wrap up fiscal 2018 funding and dive into fiscal 2019 funding. We can’t do it without you!

Sign the letter today: https://docs.google.com/forms/d/e/1FAIpQLSfklHLrZkvcTUhG-0fQjc5pmHB_7KyKPDeQwCUAAFY6gEDqTg/viewform

IEDC’s 2018 FED Forum will take place here in Washington in just a few weeks. There’s still time to register and join your colleagues. We’ll be talking access to capital, manufacturing, infrastructure, workforce development, entrepreneurship and federal resources for urban and rural communities. In many cases, we’ll be joined by the top federal officials overseeing these program areas. Check out the conference website for more details and to register.

Please contact Matt Mullin, Senior Director, Public Policy & Strategic Engagement at mmullin@iedcoline.org for questions, comments or concerns.

Wednesday, March 7, 2018

BUILDS Act introduced in the House

posted by: Kirill Abbakumov

On February 6, 2018, House Representatives Paul Mitchell (R-MI) and Tim Ryan (D-OH) introduced bipartisan legislation called the Building U.S. Infrastructure by Leveraging Demand for Skills (BUILDS) Act (H.R. 4942). The legislation would support grants to industry partnerships in transportation, construction, energy, and other infrastructure industries. Department of Labor will work in consultation with the Departments of Transportation, Energy, and other federal agencies to administer the grants for local partnerships developing work-based learning programming for a diverse pipeline of skilled workers.

In 2017, the Trump administration released as set of infrastructure principles that included a goal of training a million new apprentices over 2 years. The President’s State of the Union address earlier this year included a call for infrastructure investments, however, without a clear emphasis on the link between the investment and developing a pipeline of workers.

BUILDS Act would set aside funding from a Congressional infrastructure package for workforce development. This funding would be used to train workers needed to help businesses in targeted industries grow and maintain the workforce necessary to keep up with demand, while also ensuring that a diverse range of workers could access the training and credentials needed to find sustainable, family-supporting job in these fields.

According to the National Skills Coalition, businesses in infrastructure are currently facing intense labor shortages because of impending retirements, lack of diversity in the workforce, and overall skill shortages in growth industries. Departments of Education and Labor report that there are 68% more projected job openings in infrastructure jobs over the next 5 years than there are students training for these jobs. Meanwhile, According to a member survey conducted by the Aeronautical Repair Station Association has released a member survey which indicates that its members are poised to lose out on close to $200 million in revenues this year due to unfulfilled technical jobs.

The Senate version of BUILDS was introduced by Senators Tim Kaine (D-VA) and Rob Portman (R-OH) in the summer of 2017.

Friday, March 2, 2018

Appropriations season is here and we need your help

posted by: Matthew Mullin

The federal government is currently operating under a continuing resolution until March 23rd. Full-year appropriations are likely forthcoming in the form of an omnibus spending bill for fiscal 2018. We need your help to make sure EDA receives support in the current and next fiscal years – a debate which is taking place right now. There are three calls to action below.

Where we stand now

Congress passed a two-year budget deal earlier this year that significantly increased defense and non-defense discretionary spending limits, effectively eliminating the budget caps previously in place. Tucked away in this deal was $600 million for EDA to lead the way in helping communities impacted by disaster last year recover and rebuild. All of this is, in theory, very good news for EDA and other federal economic development programs.

What happens next

Congress still has not passed full-year appropriations for the current fiscal year. Individually, the House and Senate moved two bills on EDA funding; the former passed the House and the later passed out of committee but has not been brought to the Senate floor. The White House request included a small amount of funding to provide for an orderly shutdown of the agency. As you can see, there significant variation between funding levels.

  • House: $175 million for fiscal 2018
  • Senate: $254 million for fiscal 2018
  • White House: $30 million for fiscal 2018 (to fund an orderly shutdown of the agency)

For the current fiscal year, there remains a possibility for significant cuts to EDA despite the fact that Congress appropriated $600 million in disaster supplemental funding. EDA must still engage in their day-to-day work helping to build stronger, more resilient economies using their annual appropriation, completely separate from their work in disaster recovery. We cannot take for granted that Congress will take action to fully fund EDA in the current year. We need your help:

  • Reach out to your Members of Congress and ask them to support EDA in coming omnibus
  • Thank them for their support of EDA’s role in disaster recovery; the $600 million in critical funding will do so much good across the country!
  • Remind them that EDA has a day-to-day role in local and regional job creation that needs strong funding
  • EDA was funded at $276 million in fiscal 2017 and urge them to provide at least level funding with last year

For fiscal year 2019, it will be much the same. The White House, despite themselves requesting $300 million in disaster supplemental funding for EDA, included only $15 million in funding for EDA.

The House and the Senate will soon begin to consider their spending bills for fiscal 2019. We are urging funding at least level with fiscal 2017 for EDA -- $276 million. We’re asking you to consider adding your name to this letter.

IEDC and our partners at the Ridge Policy Group will compile the letters by Member of Congress and leadership office and disseminate them accordingly. With your voice and leadership, EDA and other critical federal economic development programs will have their best chance for surviving the continued attack on their funding.

Come to Washington

Finally, the 2018 FED Forumhttps://www.iedcevents.org/FEDForum/Registration.html is taking place at the end of next month. Regular registration has been extended until March 9th, though the hotel is filling up fast! While much of the news that is coming out of Washington is negative and seems focused on anything but economic development, the FED Forum will bring focus to myriad programs, policies, and best practices that can help you in your community still. Some highlights include:

  • Infrastructure! We’ve got a proposal of sorts from the White House and bipartisan agreement in Congress that something must be done. Economic developers must be engaged right now in order to secure our priorities in whatever bill or bills may come.
  • Manufacturing programs throughout the federal government continue to support areas ranging from workforce, to R&D, to tech transfer, to basic science. We’ve got a great panel put together that you won’t want to miss.
  • ‘A city boy’ and a ‘small town girl’ will take us on a journey (get it?) to key offerings in economic development for cities and rural communities. As many of these programs have experienced and continue to experience changes in the last year, it is more important than ever to connect with federal officials and experts.
  • Keynote from Dennis Alvord, Deputy Assistant Secretary for Regional Affairs from EDA, during our luncheon on Monday, which will also feature our annual awards presentation for federal leadership in economic development.
  • Volunteering, networking, touring, laughing and pancakes: all of these will take place on Saturday and Sunday at the FED Forum. We’ll cap-off Sunday with FED Talks, where we turn the mic over to you and your colleagues for enlightening entertaining discussions on how the federal government is, and isn’t working for you.
  • While you’re here, spend some time visiting with your staff contacts on the Hill. Congress will be in recess that week – probably – which means it is the best time to connect and reconnect with staff in personal offices and committee offices.

In conclusion:

  • Call your Member of Congress and tell them you need EDA and ask for their support for them in the fiscal 2018 omnibus spending bill.
  • Sign-on to our letter supporting EDA in the coming fiscal 2019 spending
  • Register for the FED Forum! Learn the latest and offer your perspective.

IEDC was very pleased with the inclusion of EDA in the disaster supplemental. This victory would not have been possible without your direct support and intervention!  A modest sigh of relief is warranted, but that is all. We must continue to urge support for EDA. We need your help.

Join us at the FED Forum next month. If you have any questions, please contact Matt Mullin, Senior Director, Public Policy & Strategic Engagement at mmullin@iedconline.org

Thursday, February 22, 2018

Trump’s $1.5 trillion infrastructure plan in brief

posted by: Kirill Abbakumov

On February 12, 2018, the White House has released its long-awaited vision of a new federal infrastructure overhaul, which would total $1.5 trillion. The infrastructure plan comprises mainly two parts: grant funding and regulatory reform.

The plan calls for $200 billion over 10 years in new federal spending, with the goal of leveraging those dollars to yield a total of $1.5 trillion in new spending and financing for infrastructure projects across the country. In addition to the grant components and regulatory reforms mentioned in the plan, the plan also dedicates sections to workforce development reforms, designed to support work-based learning, career and technical education.

There are four main components of the plan, three of which involve funding allocations and one which deals with regulatory streamlining measures:

  • The first component accounts for 50% of the new package’s funding and would go towards a new “incentives program,” which economic developers could access to cover as much as 20% of funding towards an infrastructure project. Traditionally, the federal government has contributed as much as 80% towards infrastructure projects. This change, which only applies to this infrastructure plan, would call for local governments to increase their financial contribution for a project, whether it be from existing revenue shifting or private sector partnerships.
  • The second component is dedicated to rural infrastructure, allocating $50 billion for infrastructure in communities with 50,000 residents or less. Grant program funding would be controlled by state governors, who would determine which projects the funding supports. Plan language implies that local investments from public or private sectors may be expected. Transportation, broadband water resources, storm water and waste water infrastructure, and power and electric facilities are named as prime sectors for these funds.
  • The third grant program calls for $20 billion to go towards “transformative projects.” This notion would build upon President Trump’s calls during the 2016 presidential campaign for new, transformative projects of “national significance.” The availability of funds would be determined by the projects’ stages: 30% for demonstration; 50% for planning; and 80% for capital construction.
  • The plan’s final funding component calls for the expansion of federal loan programs to $14 billion, many of which are used by economic developers, local, and state governments. These lending programs, the Transportation Infrastructure Finance and Innovation loans, Water Infrastructure Finance and Innovation loans and Railroad Rehabilitation and Improvement Financing program, provide low interest loans for projects.

Considerable focus has also been given to the streamlining of the permit process for undertaking infrastructure projects. Most notably, the administration has introduced a “One Agency, One Decision” process in which one lead agency would be responsible for greenlighting project permits.

The White House has stated it is open to revisions to their plan, as Congress will be tasked with crafting legislation. It has been suggested that as many as 11 separate congressional committees could have sections of jurisdiction within the infrastructure package as they process the plan into a legislative text.

Thursday, February 15, 2018

NIST seeking public comments on National Plan for Advanced Manufacturing

posted by: Kirill Abbakumov

On February 5, 2018, the National Science and Technology Council, Committee on Technology, Subcommittee on Advanced Manufacturing, the Office of Science and Technology Policy (OSTP) has issued a Request for Information (RFP) which seeks input from all interested parties on the development of a National Strategic Plan for Advanced Manufacturing. OSTP seeks input from the public on ways to improve government coordination and on long-term guidance for federal programs and activities in support of United States manufacturing competitiveness, including advanced manufacturing research and development that will create jobs, grow the economy across multiple industrial sectors, strengthen national security, and improve healthcare.

Through this Request for Information, OSTP seeks responses to a number of questions to improve government coordination and provide long-term guidance for federal programs and activities in support of United States manufacturing competitiveness, including advanced manufacturing R&D.

Responses are due by March 7, 2018. Instructions on submitting a response can be found on the NIST website.

Wednesday, February 14, 2018

Federal Alert: Two Major White House Proposals

posted by: Charlotte Scott

This past week, the White House made two major announcements, including an infrastructure plan and their budget proposal for fiscal 2019. Both proposals have far-reaching implications for economic developers.

White House Budget Proposal

The proposal includes a plan to bolster defense spending to $716 billion, while imposing heavy budget cuts that limit non-defense discretionary spending to $540 billion. Trump aims to mitigate the nation’s growing deficit via this budget strategy. Here are the overall highlights:

  • The Department of Veterans Affairs, Homeland Security, and Department of Defense will all see significant funding increases
  • HUD, EPA, Labor Department will all see significant funding cuts
  • Opioids and Mental Health will receive an additional $10 billion in funding
  • The Department of Homeland Security will receive an additional $5.1 B
    • Including $1.6 billion for 65 miles of border wall, $2.8 billion to increase immigration detention to 52,000 beds per day, $782 million to hire an additional 2,750 officers and agents at CBP and ICE

How does this proposal affect economic development?

Department of Agriculture:

  • Eliminates the Rural Business-Cooperative Service
  • Eliminates the Rural Water and Wastewater Grants program while modifying the loan program to expand the eligible community size ceiling to 20,000
  • Eliminates the Rural Economic Development Grants program

Department of Commerce:

  • Eliminates the Economic Development Administration
  • Eliminates the Manufacturing Extension Partnership (MEP), it directs MEP centers to transition solely to non-Federal revenue sources.
  • The Budget requests $9.8 billion for DOC (including changes in mandatory programs), a $546 million or a 6-percent increase from the 2017 enacted level.
  • Establish Minority Business Development Agency (MBDA) as a policy office, and eliminates their business outreach centers.

Department of Defense:

  • Provides $10.5 million for the Office of Economic Adjustment
  • Does not call for a round of Base Realignment and Closures (BRAC)

Department of Housing and Urban Development:

  • Eliminates the Community Development Block Grant (CDBG) program.

Department of Labor:

  • Funding cuts for National Dislocated Worker Grants and Adult Employment and Training Activities
  • Nearly doubled funding for apprenticeships from $95 million to $200 million

Department of Transportation:

  • TIGER program is eliminated
  • Limiting funding of the Capital Investment Grant program to projects that already have secured funding agreements

It is important to note that the President released this budget proposal just days after Congress passed budget legislation that significantly increased funding for both defense and non-defense discretionary spending. Perhaps with more time to adjust, this proposal would have provided a less aggressive budget cut strategy. We will continue to track the progress of this proposal and any changes that should arise, but it is worth noting that it is exactly this: a proposal. Congress will ultimately decide what to fund and at what levels.

IEDC will be reaching out shortly to offer guidance and resources on how best to engage your elected officials here in Washington. In the meantime, please take a moment to review our ‘Why Invest Brochure’ and consider sharing it with your colleagues, local stakeholders and elected officials.

Infrastructure Proposal

With a $200 billion investment in Federal funds, the plan claims that it will generate roughly $1.3 trillion via public-private financing at state, local, Tribal, and private levels. The main areas the plan aims to tackle are:

  • Encouraging Rural Investment
    • $50 billion will be devoted to a new Rural Infrastructure Program, which will allocate the bulk of these funds to State governors.
  • Increasing State and Local Authority
    • The Incentives Program and the Rural Infrastructure Program will award funds directly to state and local authorities, who can decide which projects to prioritize.
    • The plan will expand processed that allow environmental review and permitting decisions to be delegated to States.
    • The plan allows Federal agencies to divest assets that can be better managed by State or local governments or the private sector.
  • Reducing Regulatory Barriers to Streamline Projects
    • The plan intends to increase flexibility of the US Army Corps of Engineers, the Department of Veterans Affairs, and transportation projects with minimal Federal funding.
    • The Superfund program plans to expand funding eligibility for land revitalization projects and provide tools for managing their legal and financial matters.
  • Altering the Environmental Permitting Process
    • A “one agency, one decision” structure will be established for environmental review, transforming it from a consecutive to a concurrent review process, aiming to shorten it to a two-year operation.
  • Strengthening Workforce Development
    • The plan will reform the Perkins Career and Technical Education Program, and create short-term programs that provide students with a certification or credential in an in-demand field eligible for Pell Grants.
    • The plan will also target Federal Work-Study funds.

Trump aims to “layer over” existing trust funds by administering block grants, relying heavily on public-private investment to reach the $1.3 trillion goal. This plan highlights the many regulatory issues and barriers that delay infrastructure development. Introducing this infrastructure plan will likely incite Congressional debate surrounding these issues, which could potentially lead to significant legislative fixes in the long run.

The next few months will be packed with debate and, hopefully, legislative action. IEDC will continue to share updates with you as these and more initiatives move forward. We will be talking about all thing federal economic development at the 2018 FED Forum, taking place March 25th – 27th here in Washington, DC. There’s still plenty of time to register and we’re adding new speakers daily – register here today!

Please contact Matthew Mullin, Senior Director, Public Policy & Strategic Engagement at mmullin@iedconline.org with any questions or concerns.

Monday, February 12, 2018

CDFI Program to award $183.5 million in 2018

posted by: Kirill Abbakumov

On February 1, 2018, the Treasury Department’s Community Development Financial Institutions (CDFI) Fund published the Notice of Funds Availability (NOFA) inviting the applications for Fiscal Assistance (FA) awards of Technical Assistance (TA) grants under the CDFI program the fiscal year 2018 funding round, totalling approximately $183.5 million.

Through the CDFI Program, the CDFI Fund provides FA awards of up to $1 million to Certified CDFIs to build their capacity to lend to their target markets, and TA grants of up to $125,000 to build certified, certifiable, and emerging CDFIs’ organizational capacity to serve their target markets. The CDFI Fund expects to award approximately $183.5 million in FY 2018. Funds for the FY 2018 funding round are subject to change based on passage of a final FY 2018 budget. If Congress does not appropriate funds for the CDFI Program, there will not be an FY 2018 funding round.

The CDFI Fund was established by the Riegle Community Development Banking and Financial Institutions Act of 1994 to promote economic revitalization and community development through investment in and assistance to CDFIs. Since its creation, the CDFI Fund has awarded more than $2.5 billion to for-profit and non-profit community-based lending organizations known as CDFIs. These organizations serve rural and urban low-income people, and communities across the nation that lack adequate access to affordable financial products and services.

The FY 2018 funding round will begin in late September 2018. For more information about this NOFA, as well as application requirements, please see the Federal Register.

Thursday, January 25, 2018

Supreme Court determines WOTUS jurisdiction

posted by: Kirill Abbakumov

On January 22, 2018, the Supreme Court of the United States (SCOTUS) decided where the 2015 Waters of the United States (WOTUS) rule should be heard first in the court system. The nine justices ruled unanimously that federal district courts have jurisdiction, rather than the appeals courts. This potentially invalidates the nationwide stay issued by the 6th U.S. Circuit Court of Appeals in October 2015.

WOTUS is a term used in the Clean Water Act (CWA) to determine what waters and their conveyances fall under federal verses state permitting authority. In 2014, the Environmental Protection Agency (EPA) and the Army Corps of Engineers (Corps) rewrote and expanded the WOTUS definition, finalizing the rule in 2015. Subsequently, lawsuits were filed in both appeals and district courts arguing that EPA and the Corps had overreached in their authority to regulate certain bodies of water. However, there was significant debate whether district or appeals court had the authority to hear the case, setting the stage for the recent SCOTUS decision.

Once the 6th Circuit Court of Appeals put a nationwide stay on the rule, it could not be implemented nationally until the stay is lifted. However, now that SCOTUS decided that the cases belong in the district courts, there is some confusion about how this decision will impact the nationwide stay.

The 6th Circuit is expected to lift the nationwide stay in the upcoming weeks. At this point, the 2015 rule would go into effect in 37 states, likely resulting in additional lawsuits in the district courts. The other 13 states – Alaska, Arizona, Arkansas, Colorado, Idaho, Missouri, Montana, Nebraska, Nevada, North Dakota, South Dakota, Wyoming, and New Mexico – put the stay on the rule within their districts since 2015.

Anticipating a decision by SCOTUS, the Trump administration released a proposed rule late last year to delay implementation of the 2015 rule for two years. EPA estimates that this rule will be finalized in the next month. Concurrently, the Administration is working on an effort to withdraw the 2015 rule and recodify pre-existing regulations, while they work on a new WOTUS rewrite.

Tuesday, January 23, 2018

SBA increases licensing and examination fees

posted by: Kirill Abbakumov

On December 13, 2017, the U.S. Small Business Administration (SBA) has implemented a rule that revised its regulations to increase the Small Business Investment Company (SBIC) licensing and examination fees. SBA last increased fees for SBIC in 1996.

The Small Business Investment Act of 1958, as amended, allows SBA to collect licensing and examination fees to offset SBA's costs associated with the administration of these two activities. Current fees offset less than 40% of SBA's administrative expenses related to these activities. This final rule increases SBIC licensing and examination fees in annual steps through October 2020, at which time SBA estimates that the annual fees will recoup approximately 80% of SBA's annual expenses directly related to these activities. Beginning in October 2021, this rule increases licensing and examination fees annually based on inflation.

The rationale for this rule is based on the fact that SBA's major expenses are related to licensing and examination (e.g., personnel compensation and benefits associated with licensing and examinations, technology, subscription services, travel, and other associated costs), and excludes SBA's overhead costs (e.g., office space, utilities, and other supporting offices within SBA). In FY 2016, licensing and examination fees reimbursed approximately 35% of SBA's direct licensing and examination expenses, and less than a quarter of SBA's licensing and examination expenses when including overhead.

Monday, January 22, 2018

Government shutdown ends with third CR

posted by: Kirill Abbakumov

On January 22, 2018, the U.S. Senate and House of Representatives passed a temporary funding bill, or continuing resolution (CR), to fund the federal government through February 8, 2018. President Trump signed the legislation, soon after officially ending the shutdown, which lasted just under three days.

A breakthrough in negotiations was made after Senate Majority Leader Mitch McConnell promised to allow a floor vote on immigration legislation in February. House leadership, however, has not yet indicated whether it would follow suit.

Central to the shutdown was insistence that legislation would contain clarification on the current Deferred Action for Childhood Arrivals (DACA) policy before its expiration on March 6th. The current DACA provisions, established by an Executive Order signed by former President Barack Obama, provided certain legal protections for those who came to the United States as children with their parents, including protection from deportation. Leader McConnell’s assurance that a bill addressing DACA would come to the Senate floor for debate paved the way for a shutdown-ending vote, which passed with bipartisan support 81-18.

Friday, January 19, 2018

House passes new bill for brownfields renewal

posted by: Kirill Abbakumov

In late November, the U.S. House of Representatives overwhelmingly passed the Brownfields Enhancement, Economic Redevelopment, and Reauthorization Act of 2017 (H.R. 3017) on a 409 to 8 vote. The bill would reauthorize the U.S. Environmental Protection Agency’s (EPA) Brownfields Program. Leading up to the bill’s passage, the House Energy and Commerce, as well as Transportation and Infrastructure committees negotiated a compromise between two brownfield reauthorization bills that they had previously passed (H.R. 3017/H.R. 1758).

Originally passed in 2002 as part of the Small Business Liability Relief and Brownfields Revitalization Act (P.L. 107-118), EPA’s brownfields program provides technical assistance and grants for communities to reclaim previously owned industrial sites that have fallen into disuse. According to the EPA, there are more than 400,000 U.S. brownfields. Since the program’s inception, there have been more than 27,075 brownfields assessments and 69,275 brownfields acres cleaned up. This has sparked economic development opportunities and created over 129,240 jobs. Although the program expired in 2006, its popularity prompted Congress to appropriate funds on an annual basis.

Key provisions in the Brownfields Enhancement, Economic Redevelopment, and Reauthorization Act of 2017 include:

  • Expands brownfields liability protection for state and local governments that acquire brownfields through voluntary and involuntary means.
  • Includes abandoned petroleum sites as brownfields if there is no viable responsible party, and if EPA and the state determine that the entity assessing and remediating the site is not liable to clean up the site.
  • Broadens the universe of eligible brownfield grant entities to include 501(c)(3) organizations with a limited liability cooperation, limited liability partnership, and/or qualified community development entity. This would allow more communities to partner with outside entities to redevelop brownfields.
  • Increases funding for brownfields cleanup grants from $200,000 to $500,000 per site and allows EPA to waive that limit up to $750,000 based on need.
  • Permits additional administrative costs to be charged back to the grant. Grant recipients can use up to 5% of their brownfields grant for administrative costs.
  • Allows grants for renewable energy projects on brownfield sites, including facilities that generate wind, solar, or geothermal energy or any energy efficiency improvement project on brownfields.
  • Provides small technical assistance grants of $20,000 to states for communities with populations under 10,000 and/or in disadvantaged areas where the annual median household income is less than two-thirds of the state-wide annual median income.

The bill has been sent to the U.S. Senate for consideration, where a similar bill, the Brownfields Utilization, Investment, and Local Development Act (S. 822) was passed by the Senate Environmental and Public Works Committee in July 2016. S. 822 is currently awaiting action on the floor of the Senate.

Monday, January 15, 2018

PARTNERS Act aims to strengthen work-based learning and apprenticeship

posted by: Kirill Abbakumov

On October 25, 2017, Representatives Suzanne Bonamici (D-OR) and Drew Ferguson (R-GA) introduced the bipartisan Promoting Apprenticeship with Regional Training Networks for Employers Required Skills (PARTNERS) Act of 2017. The bill would support partnership between businesses and other local workforce stakeholders to enable small- and medium-sized employers to develop and expand work-based learning programs.

Work based learning, including apprenticeship, provides individuals with paid, on-the-job work training and experience. Small- and medium-sized businesses often lack the infrastructure to establish apprenticeships or work-based learning programs on their own. Industry or sector partnerships can help reduce the burdens on businesses and by convening local stakeholders to collaboratively develop training related instruction, support services, and on-the-job training components of a work-based learning program.

Under the PARTNERS Act, industry and sector partnerships would receive grants of up to $500,000 for two years. Recipients would convene necessary partners and coordinate a set of business services to help small- and medium-sized businesses develop and run work-based learning programs. Partnerships would also coordinate worker support services to improve worker retention and success.

Business engagement activities could include:

  • Assistance navigating registration process for apprenticeship;
  • Connecting businesses with education providers to develop classroom instruction to complement on-the-job learning;
  • Development of curriculum design of the on-the-job component of a program;
  • Service as employer of record during a transitional period for participants entering work-based learning programs;
  • Providing training to managers and front-line workers to aide in their provision of mentoring or training to work-based learning participants;
  • Recruitment of individuals to participate in the work-based learning programs, particularly individuals receiving additional workforce and human services.

Support services that help keep workers on the job could include:

  • Connecting participants with adult basic education;
  • Connecting participants with pre-work-based learning training, including through pre-apprenticeship programs;
  • Providing connections to transportation and child care services;
  • Developing mentorship opportunities; and
  • Providing tools, clothing, and other required items necessary to start employment.
Thursday, January 11, 2018

Higher Education Act reauthorization introduced in the House

posted by: Kirill Abbakumov

House Education and Workforce Committee introduced the Promoting Real Opportunity, Success, and Prosperity through Education Reform (PROSPER) Act. If signed into law, this bill would be the first reauthorization of the Higher Education Act (HEA) since 2008.

The bill embodies the consolidation of federal student aid, the expansion of apprenticeships and reconfiguration of the Federal Work Study program. The bill also includes several provisions intended to reduce federal regulations on higher education institutions, including elimination of the gainful employment rule and stator limitations. Unlike the bipartisan Perkins Act reauthorization bill passed by the House earlier this summer, the PROSPER Act is being advanced as a party-line measure without Democratic co-sponsors, which means that bill would have little chance of advancing through the Senate as drafted.

The PROSPER Act passed out of committee on December 12, 2017, by a party-line vote of 23-17. While the Act does offer some potentially useful investments in work study, apprenticeship, and other workforce development strategies, this partisan bill doesn’t do enough to make it easier for individuals to get the skills and credentials they need to advance their careers. Despite all this, the PROPSER Act promises some foundation on which to advance HEA reauthorization.

More information on the key elements of the PROSPER Act can be found here.

Tuesday, December 26, 2017

EDA updates Revolving Loan Fund regulations

posted by: Kirill Abbakumov

On December 1, 2017, the Economic Development Administration (EDA) has published revisions to the regulations implementing the Public Works and Economic Development Act, which governs EDA’s Revolving Loan Fund (RLF) Program. The regulatory changes will enable the Department to more efficiently manage the residual RLF portfolio going forward.

The changes incorporate current best practices and strengthen EDA's efforts to evaluate, monitor, and improve performance within the agency's RLF program by establishing the Risk Analysis System, a risk-based management framework, to evaluate and manage the RLF program.

To make RLF awards more efficient for Recipients to administer and EDA to monitor, EDA is also reorganizing the RLF regulations and making changes to improve readability and clarify those requirements that apply to the distinct phases of an RLF award.

In addition, EDA is updating other parts of its regulations, including revising definitions, replacing references to superseded regulations to reflect the promulgation of the Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (“Uniform Guidance”), streamlining the provisions that outline EDA's application process, and clarifying EDA's property management regulations.

The updated regulations will take effect on January 2, 2018. After the final rule becomes effective, EDA will update the full text of EDA's regulations, as amended, and post it on EDA's Web site at www.eda.gov/​about/​regulations.htm

Wednesday, December 20, 2017

Federal Alert: This Week in Washington

posted by: Matthew Mullin

Congress will vote on a number of measures this week that will impact economic development and the nation for years to come. Taxes, disaster funding, and fiscal 2018 appropriations will all be brought to a vote by Friday.


The conference report for HR 1 – the tax bill – includes a number of key changes:

  • Increased corporate tax rate from 20% to 21%
  • 20% credit for rehabilitating historic structures amortized over 5 years; 10% credit for pre-1936 buildings eliminated
  • New Markets Tax Credits preserved
  • Tax exemption related to Private Activity Bonds (PABs) is preserved, including those related to the construction of professional sports stadiums
  • Capital gains income may be temporarily deferred if invested in qualified opportunity zones; estimated to raise $1.6 billion in investments for opportunity zones over 10 years

Congress will be voting to adopt the Conference Report and sending HR 1 to the White House as early as today. The nuts and bolts of the tax bill are better at this stage than in earlier versions of the bill. However, there can be no doubt that decreasing revenue by at least $1.5 trillion will have a negative impact on funding for federal economic development programs over the next several years.

Disaster Funding

Speaker of the House Paul Ryan has signaled he will attach an $81 billion dollar supplemental disaster spending measure to the next fiscal ’18 bill, due out before midnight this Friday. The bill includes a number of key items, including:

  • $600 million for the Economic Development Administration (EDA), including a critical 2% carve out for salaries and expenses to help EDA effectively manage and execute this funding
  • $26.1 billion for Community Development Block Grants (CDBG)
  • $12.1 billion for the Army Corps of Engineers

The bill will bring the total amount of disaster funding for 2017 to $132.75 billion, a record. The Senate has yet to weigh in and it is possible the funding will be delayed past this Friday’s expiring Continuing Resolution (CR) unless agreement materializes quickly.

2018 Appropriations

Congress must pass legislation by midnight Friday to avoid a government shutdown. At this point, it seems unlikely we will see full-year appropriations for the remainder of 2018. The House is likely to pass a Defense-CR hybrid, funding defense for the remainder of the year and funding everything else through a CR into January, prompting another funding showdown at that time.

The Senate will have to respond, either by passing the House measure or altering it before kicking it back to the House. If it kicks it back to the House with changes, which it is almost certain to do since the measure will need at least 8 Democratic votes in the Senate to pass, the Speaker will likely need Democratic votes to pass it to avert a shutdown.

All of this essentially equates to kicking the can again, so we will be once again debating fiscal 2018 funding – well into the second quarter of the fiscal year. Disaster funding could be included to help gather votes, though it seems just as likely disaster funding will be excluded in favor of keeping it for a ‘final’ push for complete fiscal 2018 funding in January.

Wrapping up 2017

We are pleased that at the end of this very tumultuous year, EDA remains intact and positioned to remain strong into the coming years, SelectUSA has been identified as a priority by the new administration, CDBG lives on to fight another day, New Markets Tax Credits & Historic Tax Credits will continue to be part of the economic developer’s toolkit, and tax exemption for PABs will continue to support growth in communities across the country. And despite the devastation of disasters from Puerto Rico and the U.S. Virgin Islands to California, the importance of economic recovery has taken hold with the administration and Congress.

However, we remain concerned about EDA funding overall, which should at least be at fiscal 2017 levels – about $273 million – and providing SelectUSA with at least $10 million. The debate over the federal role in local economic development will only increase in intensity as we begin to wrestle with decreasing revenue against increasing need. For now we have no new action items for economic developers beyond continuing to communicate your support for robust funding for EDA in both the disaster supplemental and fiscal 2018 appropriations.

Before very long we will be pivoting to fiscal 2019 and the next set of administration priorities: President Trump will deliver the State of the Union address on January 30th, 2018, and releasing his fiscal 2019 budget proposal shortly thereafter. Join us at the 2018 FED Forum March 25-27th for the latest news and information on all things federal economic development.

Friday, December 8, 2017

Federal Alert: A December to Remember

posted by: Matthew Mullin

It has been a very busy few weeks in Washington. Congress is at once grappling with the most far-reaching tax reform legislation in decades, addressing the latest White House request for supplemental disaster funding, and plotting a course for keeping the government running past the December 22nd expiration of the Continuing Resolution (CR) currently funding the government.


The House and Senate have now passed their versions of comprehensive tax reform legislation. There are significant differences between the bills, including individual tax brackets, sunsets for tax benefits, the elimination of tax exemption for some municipal bonds, roll-backs on historic tax credits and the elimination of New Markets Tax Credits.

To be clear, while a step closer to becoming the law of the land, the process is far from over.  Republican leaders in the House and Senate, as well as the White House, are still targeting final passage before the end of 2017.

The members of the conference committee that will iron out the bill for final consideration in the House and Senate are (Democrats in italics):

            Sen. Orrin Hatch – UT                                    Sen. Ron Wyden – OR
            Sen. Mike Enzi – WY                                      Sen. Bernie Sanders – VT
            Sen. Lisa Murkowski – AK                             Sen. Maria Cantwell – WA
            Sen. John Cornyn – TX                                  Sen. Debbie Stabenow – MI
            Sen. John Thune – SD                                   Sen. Robert Mendez – NJ     
            Sen. Rob Portman – OH                                Sen. Tom Carper – DE
            Sen. Tim Scott – SC                                       Sen. Patty Murray – WA
            Sen. Pat Toomey – PA

            Rep. Kevin Brady – TX                                   Rep. Richard Neal – MA
            Rep. Devin Nunes – CA                                 Rep. Sander Levin – MI
            Rep. Peter Roskam – IL                                 Rep. Lloyd Doggett – TX
            Rep. Diane Black – TN                                   Rep. Raul Grijalva – AZ
            Rep. Kristi Noem – SD                                   Rep. Kathy Castor – FL
            Rep. Rob. Bishop – UT
            Rep. Don Young – AK
            Rep. Greg Walden – OR
            Rep. John Shimkus – IL

Action Item #1

There is still time to raise your concerns with your Members of Congress, particularly if one of them happens to be on the conference committee. IEDC remains committed to protecting the tax-exempt status of municipal bonds (including Public Activity Bonds), historic tax credits and New Markets Tax Credits and we continue to communicate those views to Congress.

For more information:

The Joint Committee on Taxation has released this very in-depth analysis of the two versions of tax legislation.

Bloomberg Government has put together this very handy side-by-side comparison of the two bills.

The Committee for a Responsible Federal Budget has a good blog post explaining the scoring of the bill here.

Here is a brief report from the Congressional Research Service on the impact of the House and Senate tax bill on individuals over the life of the bill, by tax bracket.

Alan Simpson and Erskine Bowles, Co-Chairs of the National Committee on Fiscal Responsibility and Reform, penned an Op-Ed worth reading here.    

Supplemental Disaster Funding

On November 17th, the Office of Management & Budget (OMB) submitted their second supplemental disaster funding request related to Hurricane’s Irma, Marie and Harvey, as well as the Western wildfires. The request totaled roughly $44 billion, including a $300 million request for the Economic Development Administration (EDA). The request was quickly panned by Republican and Democrat lawmakers in Congress as woefully inadequate.

Texas, Florida, California, and Puerto Rico have, collectively, requested roughly $2.04 billion in supplemental funding for EDA. While we are encouraged by OMB’s request of $300 million given their previous requests to shut-down EDA, we are hopeful the agency will receive funding closer to that which was requested by Members of Congress and local leaders from impacted states. There is no firm timeline for when we might see the next supplemental legislation pass through Congress, though it had been hoped it would be part of the next fiscal 2017 appropriations bill, either another Continuing Resolution (CR) or full year spending bill.

Action Item #2

Please continue to encourage your elected officials to include EDA in future disaster supplemental funding requests. Be sure to include any examples you may have of how EDA has supported your community following disasters. If you have been fortunate enough to not need EDA in these circumstances, you should include a project or two from your community that has used EDA funding in the past. These past few months have seen unprecedented disasters impacting multiple states across broad regions. While your community may not be impacted, it is important to recognize that disaster can strike any community and when it does, resources like those offered by EDA will be there to help you rebuild only if we continue to show strong support for them today.

Fiscal 2017 Appropriations

The federal government is currently operating under a CR through Friday, December 22, 2017. If Congress does not act prior to midnight on that date, the federal government will shut down for the first time since 2013. Republicans in the House and Senate, as well as the White House, insist there will not be a shutdown, though disagreements over a number of potential policy riders may bring it down to the wire. OMB proposed shutting down a number of vital economic development programs for fiscal 2018, including MEP, the Minority Business Development Agency, CDBG, and multiple Rural Development programs, among others. Your voices will be critical in saving these agencies.

As a full-year spending bill takes shape, IEDC will share additional details with our members while remaining engaged with appropriators in Congress.

Action Item #3

Reach out to your Members of Congress and ask for their support for EDA in the full-year appropriations bill. Be sure to also include all of the agencies listed in our Why Invest in Economic Development brochure.

The end of 2017 is shaping up to be as exciting as the beginning. IEDC continues to be engaged on the Hill, with our partner agencies, and with our fellow economic development stakeholders. Your voices as economic development practitioners and constituents will always resonate more and it is critically important that you reach out to your elected officials and speak up in support of federal economic development resources and a tax plan to that supports responsible growth.

There will be much to discuss at the 2018 FED Forum March 25-27th here in Washington. Congress may still be grappling with tax reform, and may by that time have added infrastructure to their big-ticket legislative items list. The White House will have released their budget proposal for fiscal 2019, giving us a look at their priorities just over the horizon. We may soon learn more about rumors of a proposed merger of economic development programs and agencies into a new agency or department, and so a discussion among the members our profession on that topic will be timely. Registration is open now and program and speaker details will be updating regularly. We hope to have you with us in March!

Please contact Matt Mullin, Senior Director of Public Policy & Strategic Engagement, at mmullin@iedconline.org with any questions or concerns.

Friday, December 1, 2017

WOTUS rule implementation postponed until 2019

posted by: Kirill Abbakumov

On November 5, 2017, the Environmental Protection Agency (EPA) and the U.S. Army Corps of Engineers (Corps) proposed extending the implementation of the 2015 Waters of the United States (WOTUS) rule until 2019. EPA and Corps have sent their proposal to the Office of Management and Budget for review, after which it will be published as a proposed rule in the Federal Register and open to public comment. This would give the agencies more time to work through the rulemaking process to repeal and replace the 2015 WOTUS rule, which is currently under a nationwide stay pending a Supreme Court decision early next year.

WOTUS is a term used in the Clean Water Act to define those waters that require federal Clean Water Act permits. In 2015, the Obama Administration finalized a new WOTUS rule that would have expanded federal jurisdiction over county-owned infrastructure, including county-owned ditches, channels, culverts and stormwater systems.

After the rule was finalized, lawsuits were filed in both appeals and district courts arguing that EPA and Corps had overreached in their authority to regulate certain bodies of water. The 6th Circuit Court of Appeals ruled that it had jurisdiction – a ruling that has since been challenged to the U.S. Supreme Court. It is expected that, when the Supreme Court rules on court jurisdiction, the stay may be lifted across much of the country, at which time the 2015 rule will be implemented.

As a result of a February 28 executive order titled, Restoring the Rule of Law, Federalism, and Economic Growth by Reviewing the “Waters of the United States Rule”, EPA and Corps are withdrawing and replacing the 2015 rule.

Current timeline for the WOTUS rule:

  • Phase ZERO has been sent to the White House Office of Management and Budget for review. Once the review is finished, it will be published in the Federal Register and the public will be permitted to comment on it for roughly 30 days. The rule is expected to be finalized in early 2018.
  • Phase ONE, to repeal the 2015 rule and reinstate previous regulations, has begun. The public comment period for this closed on September 27, and a final rule is expected by Spring 2018.
  • Phase TWO would replace the 2015 WOTUS rule. The timing for this action is uncertain, although it is likely tied to the rule’s withdrawal in Spring of 2018.
Tuesday, November 14, 2017

SelectUSA seeking to work with economic developers for 2018 Summit

posted by: Kirill Abbakumov

SelectUSA has announced that it is extending its deadline for proposals from economic developers until November 30, 2017 for the 2018 Summit. SelectUSA is a government-wide program of the International Trade Administration (ITA) under the Department of Commerce (DOC) that assists economic development organizations to compete globally for investment by providing information, a platform for international marketing, and high-level advocacy. 

SelectUSA is eager to work with economic development communities to plan and promote spin-off events to attract SelectUSA Summit participants to states, cities or regions. The dates of the SelectUSA Summit (June 20-22, 2018) allow for spin-off events to take place the week of June 25-29, 2018 with ample travel time during the weekend in-between (June 23-24, 2018).

All international SelectUSA Summit participants will also be actively encouraged to extend their stay in the United States and connect directly with economic developers, business leaders and local experts while exploring promising investment opportunities in various communities. The deadline for the SelectUSA Investment Summit Call for Proposals has been extended to Thursday, November 30. 

SelectUSA is encouraging economic developers to mobilize teams and local networks in order to plan a program to attract SelectUSA Summit delegations to visit various regions. SelectUSA and U.S. Export Assistance Centers across the country are prepared to work with economic developers to plan and implement spin-off events to showcase the tremendous investment opportunities in the U.S. market.

Since its inception, SelectUSA has facilitated more than $25 billion in investment, creating and/or retaining tens of thousands of American jobs.

For more information on SelectUSA's Call for Proposals and collateral and spin-off events, please visit the Summit website.

Friday, November 10, 2017

Federal government emphasizes continued investment in manufacturing

posted by: Kirill Abbakumov

In early October 2017, U.S. Secretary of Commerce Wilbur Ross released the Streamlining Permitting and Regulatory Burdens for American Manufacturers report that was submitted to President Donald Trump. The report gathered input from domestic manufacturers and industry stakeholders to identify 20 sets of regulations and permitting issues considered as top priority for reform and immediate action for increasing the capacity of American manufacturing industry.

With 12.4 million employees in the U.S. producing goods that are consumed domestically or exported abroad, manufacturing is one of the keys to building stronger communities. The report is taken as an important step in correcting the status quo and promoting American manufacturing by targeting onerous and lengthy processes and inadequately designed rules that add to an already overwhelming amount of government waste.

Three major themes were identified by domestic manufacturers and industry stakeholders in the report:

  • Overlap, duplication and lack of coordination between states and the Environmental Protection Agency (EPA);
  • Uncertainty related to the permitting process;
  • Inconsistency in application and enforcement.

As a critical economic sector, manufacturing has seen targeted development from the Economic Development Administration (EDA), which has invested close to $86 million in 84 projects since January 2017 to help communities and regions strengthen their manufacturing competitiveness. These included over $65 million in 47 projects that are expected to create and/or retain over 14,000 jobs and attract more than $3.4 billion in private investment.

EDA also invested over $20 million in 37 projects to support planning, research, technical assistance, access to capital, or other activities that are essential for successful manufacturing-related economic development and job creation in the future. These include the $2.35 million investment into Ranken Technical College in Missouri, a part of the new Manufacturing Inc. incubator. Ranken is a private, non-profit, degree-granting institution focused on providing the comprehensive education and training necessary to prepare students for employment and advancement in a variety of technical fields.

Thursday, November 2, 2017

Brownfields identified as priority by EPA

posted by: Kirill Abbakumov

On October 5, 2017, the Environmental Protection Agency (EPA) has released a draft of its strategic plan, which establishes work on brownfield sites as a key agency priority goal for 2018 and 2019. Cleaning up brownfield sites and returning them to public and business is expected to further benefit the environment, the communities where they are located, and create jobs that grow the economy.

Since 1995, the EPA has been administering federal brownfields grants that provide funds for inspection and cleanup of contaminated sites so that they can be used in redevelopment projects. Cleaning up a blighted property has both environmental and economic benefits including raising overall property values. Studies estimate that for every acre that is redeveloped, it produces an estimated 10 jobs and saves 4.5 acres of open space.

Cleaning up brownfields can also increase property values by 5-15% and for each public dollar spent and attract more than $17 in private investor funding. The federal government Accountability Office estimates there are 425,000 of these types of properties, such as abandoned strip malls, gas stations, dry cleaners, junkyards, warehouses, and industrial properties, across the United States.

Several brownfields reauthorization bills are awaiting action in Congress. Typically, the brownfields program is budgeted at about $160 million per year. The House of Representatives bills are:

  • The House Committee on Transportation and Infrastructure approved the Brownfields Reauthorization Act of 2017 (R. 1758) which would reauthorize the EPA’s brownfields redevelopment program at $200 million a year.
  • The House Committee on Energy and Commerce passed the Brownfields Enhancement, Economic Redevelopment and Reauthorization Act of 2017 (R. 3017) which would extend liability protections for local governments that acquire brownfields.
  • In the Senate, a bill introduced by Sen. James Inhofe (R-Okla.) was placed on the Senate legislative calendar Sept. 7.

The two House committees are in the process of negotiating a compromise between the two bills.

To learn more about how to redevelop brownfields, please visit www.brownfields2017.org, an initiative by the National Association of Counties (NACo).

Wednesday, November 1, 2017

SBA launches expedited disaster relief funding

posted by: Kirill Abbakumov

On October 16, 2017, the Small Business Administration (SBA) announced SBA's Express Bridge Loan Pilot Program (Express Bridge Pilot), which will provide expedited guaranteed bridge loan financing for disaster-related purposes to small businesses located in communities impacted by natural disasters.

SBA provides assistance to small businesses located in the communities affected by Presidentially-declared disasters. The Express Bridge Pilot initiative is designed to supplement the SBA’s disaster response capabilities and the Pilot will authorize the Agency's 7(a) Lenders with SBA Express lending authority to deliver expedited SBA-guaranteed financing on an emergency basis for disaster-related purposes to small businesses located in these communities while the businesses apply for and await long-term financing (including through SBA's direct disaster loan program, if eligible).

As a consequence of devastating hurricanes and storms in recent months, a new modification of the lending criteria will minimize the burden on businesses applying for loans through the Express Bridge Pilot and provide an incentive for SBA Express lenders to participate in the pilot. This will allow SBA Express lenders to expedite the processing of these small guaranteed loans in order to provide immediate cash to assist small businesses with rebuilding and continuing or restarting their operations while awaiting long-term disaster financing.

For full details, application criteria, and modified lending criteria, please consult the Federal Register.

Tuesday, October 24, 2017

SBA seeking public input on reducing regulatory burden

posted by: Kirill Abbakumov

On October 15, 2017, the Small Business Administration (SBA) extended its comment period for a proposed rule on “Reducing Unnecessary Regulatory Burden”. The information obtained from the public will assist SBA in identifying which regulations should be repealed, replaced, or modified because they are obsolete, unnecessary, ineffective, or burdensome.

SBA has an ongoing responsibility to ensure that the regulations it issues do not have an adverse economic impact on those affected by the rules. This responsibility has been reinforced in various executive orders that have expressly directed agencies to review their regulations with an eye towards reducing the time and money the public must spend to comply with the regulatory requirements.

One of SBA's primary objectives in carrying out these efforts is to continue to promote economic growth, innovation, and job creation in the small business sector, and to ensure that disaster survivors have the clear policy and procedural guidance they need to quickly obtain financial assistance to rebuild their lives. Anyone responding to SBA's request for feedback should keep these objectives in mind.

SBA has previously announced its request for information seeking input from the public on August 15, 2017, and is now extending it until November 15, 2017. Comments can be submitted through the Federal Register.

Monday, October 16, 2017

New round of funding available for rural communities

posted by: Kirill Abbakumov

On October 12, 2017, the Rural Utilities Service (RUS), an agency of the United States Department of Agriculture (USDA), announced the availability of up to $10 million in FY2017 and application deadlines for competitive grants to assist communities with extremely high energy costs through the Assistance to High Energy Cost Rural Communities Program.

This program was established in 2000 to provide assistance for communities most challenged by extremely high energy costs, defined by statute as average residential home energy expenditures that are 275% or more of the national average. This statutory threshold for eligibility is high and has the result of limiting the availability of this program to extremely high cost and typically remote areas.

The purpose of this program is to provide financial assistance for a broad range of energy facilities, equipment and related activities to offset the impact of extremely high home energy costs on eligible communities. The grants help communities provide basic energy needs by financing energy infrastructure supporting rural prosperity and job creation.

Grant funds may not be used to pay utility bills or to purchase fuel. Nor may grant funds be used for education and outreach except for training that is directly related to energy facilities financed in all or part by this program. Upgrades to existing facilities are also eligible. Grant projects under this program must serve an eligible community and not be for the primary benefit of an individual applicant, household, or business.

The deadline for applications is December 11, 2017. More information can be found on the Federal Register.

Tuesday, October 10, 2017

DOT announces $500 million for TIGER grants

posted by: Kirill Abbakumov

On September 6, 2017, the U.S. Department of Transportation (DOT) announced a new round of Transportation Investment Generating Economic Recovery (TIGER) Grant funding, totaling $500 million. These competitive grants, appropriated as part of the FY2017 budget year, will have an application deadline of October 16. 

As part of the rollout of this new funding, DOT will be hosting two webinars to assist in the completion of TIGER applications. These webinars will be held from 2:00 to 4:00 PM EDT on Wednesday, September 13 and Tuesday, September 19. To register, please visit the TIGER Webinar Series webpage. In addition, DOT confirmed that more webinars will also be held sometime in the future. This new round of grant funding has updated criteria, making these webinars an important source of information and assistance.

In the funding opportunity announcement, DOT states these grants will give special consideration to projects which emphasize improved access to reliable, safe, and affordable transportation for communities in rural areas, such as projects that improve infrastructure condition, address public health and safety, promote regional connectivity, or facilitate economic growth or competitiveness.”  This will provide an opportunity for economic developers to take advantage of this federal funding partnership in both rural and urban settings.

TIGER grants were originally introduced as part of the 2009 economic recovery package legislation (American Recovery and Reinvestment Act), have awarded over $5.1 billion for capital investments in surface infrastructure over 8 rounds of competitive grants. TIGER grants have historically achieved, on average, co-investment of $3.6 (including other Federal, State, local, private and philanthropic funds) for every TIGER dollar invested. 

Thursday, October 5, 2017

NGA launches new program to advise states on emerging tech

posted by: Kirill Abbakumov

On September 27, 2017, the National Governors Association (NGA) announced the creation of a new advisory division intended to help state government leaders better understand their roles in relation to a growing host of emerging technologies.

Called NGA Future, the new division is a place where emerging technology and state public policy intersect. The idea is to build a network of experts from the private sector, media and academia who can help governors understand which new technologies — like blockchain and the Internet of Things (IoT) — are worth their time and how they might fit into the future of state government policy.

These could be areas where states could take advantage of certain technological developments to improve how government operates, or areas where technological developments are going to change or have a major impact on state economies and therefore governors need to develop policy and best practices in preparation for that change.

The initial focus areas identified by NGA Future include blockchain, the tradeoffs inherent in increased connectivity, transactional payment technologies, distributed ledgers and their potential for state government, automation’s impact on the future of labor and the use of cognitive computing to improve public policy.

NGA traditionally has served as a convener and adviser for governors on a wide array of issues, including those surrounding technology. The organization has recently taken a facilitating role in helping states like Illinois scale emerging technology initiatives beyond state lines. The state's blockchain for government and Smart State initiatives have garnered interest from other states, and NGA is helping to host gatherings and share information that will allow further development elsewhere.

Monday, October 2, 2017

New EPI report examines local, state, and federal infrastructure investments

posted by: Kirill Abbakumov

On September 11, 2017, the Economic Policy Institute released a new report examining the division among federal, state, and local governments for funding, financing, and overseeing infrastructure investment. The main findings of the report are that the case for state and local governments to play the larger role in infrastructure investment is quite weak, while the benefits of a strong role for the federal government in funding, financing, and overseeing infrastructure investments are much greater.

Infrastructure plays a vital role in economic growth, and over the past year there have been a growing bipartisan support for increased investment in America’s infrastructure. But supporters of infrastructure investment often have conflicting ideas about which level of government will provide that investment.

The Trump administration’s infrastructure plan would leave state and local governments to pick up at least 80% of the increased investment. In contrast, Senate Democrats recently proposed a $1 trillion infrastructure plan constituted entirely of federally funded and financed investment.

Other key findings of this report include:

  • The federal government can help mitigate infrastructure funding challenges at the state level during economic downturns because it can run deficits over the short term, positioning the federal government in helping states to maintain stable or increasing infrastructure investment.
  • Infrastructure user fee pricing mechanisms are the best funding option for ensuring economic efficiency; such mechanisms can be managed at any level of government – federal, state, or local.
  • Because most infrastructure is connected to regional or national infrastructure networks, federal government may be better positioned than states to make infrastructure decisions that most effectively and efficiently integrate the network by taking into account economies of scale and positive spillover effects.
  • The federal government can play an important role in pricing externalities, taking account of externalities of carbon emissions and avoiding the challenge of states setting different carbon pricing levels.
  • A federal role can help ensure equitable access to infrastructure for all citizens by promoting equity and access to basic needs, ensuring that all citizens regardless of where they live and regardless of local economic conditions.
Wednesday, September 27, 2017

DOT to scrap proposed local hire program for infrastructure projects

posted by: Kirill Abbakumov

On August 24, 2017, the U.S. Department of Infrastructure (DOT) announced that it will withdraw a proposed rule developed under the Obama administration that would permit local governments to use geographic hiring preferences for transportation infrastructure projects.

DOT does not permit recipients or sub-recipients of federal funds to impose in-state or local geographic preferences in procurement processes unless those preferences are explicitly permitted or encouraged under federal law. However, many communities have sought to use “local hire” provisions to help ensure that low-income individuals and other underrepresented populations in or near infrastructure projects are able to benefit from jobs created through these investments.

The Obama administration previously sought to expand access to local hire provisions under federal transportation contracts, launching a pilot program under DOT to allow for local hire initiatives in at least 10 states. DOT also issued a Notice of Proposed Rulemaking (NPRM) in March 2015 that would have explicitly permitted such provisions, but the DOT withdrawal announcement signals that the Trump administration will not be carrying forward this important effort.

With President Trump’s continued support for a major infrastructure package, and more generally his campaign promises to focus on job creation and economic growth, the withdrawal is particularly disappointing for economic developers at the state level. A recent report from Georgetown’s Center on Education and the Workforce estimated that a $1 trillion investment in infrastructure could create more than 11 million new jobs in construction, manufacturing, and other critical sectors.

America currently lacks a well-designed infrastructure bill that could include significant new investments in work-based learning strategies and work supports that help to diversify the pipeline of workers into these new jobs is essential for promoting economic opportunities while also helping employers address existing and future workforce gaps. The bipartisan Building U.S. Infrastructure by Leveraging Demands for Skills (BUILDS) Act, introduced earlier in 2017, is only one such attempt at encouraging investment in industry-driven partnerships in infrastructure sectors while also supporting critical pre- and post-employment services to help low-skilled individuals advance in these careers.

Wednesday, September 20, 2017

SBA expands regulations on passive investments

posted by: Kirill Abbakumov

The U.S. Small Business Administration (SBA) is withdrawing the final rule concerning Small Business Investment Company (SBIC) investments in passive businesses that was published on December 28, 2016, and is replacing it with a new final rule. This final rule expands SBIC permitted investments in passive businesses and includes new reporting and other requirements for passive investments. This rule also makes a few minor technical amendments.

SBICs are generally prohibited from investing in passive businesses under the Act. Prior to this final rule, the previous SBIC program regulations provided for the two exceptions that allowed an SBIC to structure an investment utilizing a passive small business as a pass-through through a holding company exemption and blocker corporation exemption.

SBA is withdrawing the final rule published on December 28, 2016, and is replacing it with a new final rule that expands permitted investments in passive businesses, provides further clarification with regard to investments in such businesses, and adds certain requirements to improve SBA's ability to monitor such investments. The rule also includes a conforming change to the regulations regarding the amount of leverage available to SBICs under common control to be consistent with the Consolidated Appropriations Act of 2016 (H.R. 2029), which increased the maximum amount of such Leverage from $225 million to $350 million.

Wednesday, September 13, 2017

DOT announces experimental initiatives on public transit financing

posted by: Kirill Abbakumov

On August 31, 2017, the Department of Transportation’s (DOT) Federal Transit Administration (FTA) announced its proposal of new, experimental procedures to encourage more innovation in project funding, improved efficiency, and new project revenue streams in infrastructure and transportation projects. The primary goal is to address impediments to the greater use of public-private partnerships (P3s) and private investment in public transportation capital projects (Private Investment Project Procedures or PIPP).

Over the past decade, federal legislation has evolved to encourage increased use of public-private partnerships and private investment in public transportation capital projects. FTA has been active in providing limited technical assistance to transit agencies, local officials, and consultants on legal and regulatory issues, financing, and contract matters related to P3s in order to facilitate increased private sector participation in project development and operation of transit projects.

Upon ratification of the Moving Ahead for Progress in the 21st Century Act (MAP-21), FTA was able to identify impediments to the use of public-private partnerships and private investment in public transportation capital projects, and to develop and implement procedures that authorize an expedited project delivery program for capital investment projects that requires projects be supported, at least in part, by public-private partnerships.

FTA anticipates using the lessons learned from experimental PIPP procedures to develop more effective approaches to including private participation and investment in project planning, project development, finance, design, construction, maintenance, and operations.

FTA is soliciting public comments on the announced proposal until September 29, 2017. Any comments filed after this deadline will be considered to the extent practicable. Comments can be submitted through the Federal Register.

Friday, September 8, 2017

Congress to begin tax reform before the end of the year

posted by: Kirill Abbakumov

On July 27, the Trump administration and House and Senate leadership issued a joint statement on the importance of and next steps for tax reform, which they hope to hold up as a major legislative accomplishment. In the statement, the two congressional tax-writing committees aims to develop and draft legislation that will result in a comprehensive tax reform suitable for the needs of modern America. The statement also suggests that collaboration between Democrats and President Trump is expected.

Simplification and lowering of tax rates could significantly boost economic development and help tax payers around the country, particularly in rural communities. The priority for economic developers focus on the possibility of tax-exempt status of municipal bonds and the deductibility of state and local taxes.

Tax-exempt municipal bonds are a critical financing tool for major infrastructure purposes, including roads, bridges, hospitals and schools. Additionally, eliminating deductibility of state and local taxes would be a double tax on individuals, significantly impacting local middle class tax payers and asking them to shoulder an increased burden for key local priorities.

While the statement is a positive indication of cooperation between Congress and the administration, the lack of details indicates much work remains to be done. Tax reform is complicated, and each member of Congress and the coalition are likely to bring different ideas and concerns to the table. Congressional leaders have aimed for initial drafts to be released in September after the August recess, though that month will also be consumed by federal budget and appropriations debates and potentially additional health care reform efforts.