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Wednesday, July 27, 2011

Economic Development Administration: Reauthorization Issues in the 112th Congress

Eugene Boyd
Analyst in Federalism and Economic Development Policy

Oscar R. Gonzales
Analyst in Economic Development Policy

The primary focus of the Department of Commerce’s Economic Development Administration (EDA) is to help regions experiencing long-term economic distress or sudden economic dislocation attract private-sector capital and create higher-skill, higher-wage jobs through investments in public infrastructure, the provision of technical assistance and research, and the development and implementation of Comprehensive Economic Development Strategies (CEDS). EDA was created with the passage of the Public Works and Economic Development Act (PWEDA) of 1965, P.L. 89-136 (79 Stat. 552, 42 U.S.C. § 3121).

The 112
th Congress may consider legislation to reauthorize and amend PWEDA, whose statutory authority expired on September 30, 2008. As part of those deliberations, Congress may consider a number of changes in the structure of EDA assistance programs. At least one bill, S. 782, the Economic Development Revitalization Act, has been reported by a congressional committee. The Senate Committee on Environment and Public Works reported the bill on May 2, 2011. The bill includes several provisions intended to encourage regional and interagency cooperation, expand the role of regional Economic Development Districts, and modify the factors used to determine the federal share of EDA-funded projects and activities. The bill also includes proposals that would address a number of programmatic concerns raised by grant recipients, including provisions that would: 
·         grant eligible entities, including EDDs, administering revolving loan funds (RLF) greater flexibility in the management and conversion of RLF assets for other EDA-eligible activities; and 
·         change the current requirements governing the transfer of federal interest in EDA-financed construction projects in an effort to encourage local flexibility in the use of EDA funds. 
The Senate began consideration of S. 782 on June 8, 2011. For six days—over a two-week period that ended on June 21, 2011—the Senate debated the bill. In an effort to end debate and bring the bill to a floor vote, a cloture motion was filed on June 16, 2011. Successful adoption of the cloture motion would have limited time for debate on the bill, prohibited consideration of nongermane amendments, and allowed the Senate to vote on passage of S. 782. On June 21, 2011, the chamber rejected the cloture motion, 49-51. Currently, the bill has been set aside and may be considered at a future date in the 112th Congress.

The reauthorization of EDA and its programs will take place within the context of more prominent policy debates regarding efforts to reduce federal spending to address growing budget deficits and the national debt; concerns about the duplication, fragmentation, and effectiveness of federal economic development assistance; and efforts to support economic recovery and job creation following the worst economic recession since the Great Depression. 

This report will discuss EDA reauthorization and appropriations-related issues.

Date of Report: July 7, 2011
Number of Pages: 20
Order Number: R41162
Price: $29.95

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