* Broad advice: don't over lube the internal components. Always clean around the cover plates before removing them.

* Check the brake drum for roundness, have it milled as needed.

* Acquire all the replacement parts, e.g.: pilot bearing, throwout bearing, clutch plates (fiber & steel as needed), pressure plate, and brake band (oversized if you've milled the brake drum). Also have on bearing grease, hand sealants, brake parts cleaner, steel wool & paper towels.

* Pack the pilot bearing with grease and install it. Clean everything very well when done.

* Thoroughly clean the interior of the steering clutch assembly, both the section still on the bulldozer and on the final drive. Use steel wool and brake cleaner to prep the machined flat faces for sealing. Clean all residues from the brake drum and steel clutch plates.

* Reassemble the steering clutch into the brake drum. First place a fiber clutch plate against the interior back wall of the brake drum, then a steel plate. Insert the interior drive hub with retaining clip. The drive hub's retaining clip lies in the same plane as the first steel clutch plate already in place. Insert the remaining fiber & steel plates. NB: If you try to mount all the plates onto the hub on the outside of the retaining clip (as described in some manuals), you will fail and have to dismount and dissasemble the final drive, and likely have to replace at least one fiber plate. I had a John Deere dealer mis-repair a couple of JD350 final drives, so I know it is a mistake one can make.

* Insert the drive shaft.

* Bolt on the pressure plate (torque to 20 ft/lbs). Be sure you can freely install and remove the drive shaft (loosen the pressure plate and re-align/re-tighten as needed). Actuate (or rap on) the pressure plate a few times to assure the plates are all snug and tight during the adjustment. Acquire or fabricate the plate guage (see photos), and adjust the three pressure plate fingers to the correct uniform height. You can tweak the standard height up a bit if you want to shorten the steering lever throw and take up some threads on your lever-to-throwout adjuster (if this sentence doesn't make sense, just ignore it and use the factory settings).

* Using the absolute minimum of grease, lube the bearing carrier shaft. Install the new throwout bearing onto the carrier and restore the return spring to lie in front of its upper retaining bolt. Lube the other internal components in the same fashion: minimally and with terrific care to not contaminate the brake or clutch, now or in the future.

* Install the brake shoe.

* You are ready to re-install the final drive.

* Ready a clean support rope for the brake drum. Remove the drive shaft and position the final drive proximate to its mounted position on the bulldozer. Install the drive shaft inside the bearing carrier tube with the pilot bearing end out. Install the 18" long 1/2" threaded rods and their support. Turn the final drive/brake drum until the drive shaft is aligned at both ends and will allow the final drive to slide to the bulldozer. Do not contaminate the brake drum during this alignment.

* Clean the brake drum one last time. Apply sealant to the machined face of the bulldozer where it meets the final drive. Put in a couple of bolts and pull the final drive into position. Install the Cross Bar mounting bolts. The John Deere manual notes the fact that special "barrel" bolts should be lubed with "Lubriplate" (tm) and torqued to 300 ft/lbs. The other two are torqued to 250 ft/lbs. All four of these bolts can be accessed from the side of the machine. Once they are installed, bolt up the rest of the final drive. The larger (upper) bolts torque to 175 ft/lbs, and the smaller (1/2") bolts torque to 85 ft/lbs.

* Adjust the steering clutches in the normal fashion.

* Restore the remaining components (track, side cylinder, fuel tank, etc). Adjust the track tension as usual.

* If you drained the final drive, replace the lubrication: c. 3 qts hydraulic fluid.

* Make a final inspection of the machine.

* Fire it up and test your new steering clutch. It should be in good working order. Once satisfied, it is a good practice to seal the steering clutch top plates: it is work to open the clutches for adjustment, but the risk of contamination is nearly eliminated by sealing them.

This is a one man job with the right tools. Click to see photos of a JD350 Steering Clutch R&R

* Pull rear floor panel and seat bottom. Pressure wash dozer's back, belly pan bolts, & side(s) & top, under the seat.

* Position bulldozer on shop floor for good access to the final drive by hoists/cranes/backhoe.

* Jack up the side of the bulldozer under repair until the track is clear of the floor. Hold back the off side steering clutch lever so that track does not spin, and turn the repair side track to orient the removable track retaining link pin. A hammer clears best when the pin is about centered, about one half way up the rear sprocket.

* Release or unscrew the Zirk fitting on the repair side track cylinder, to slacken the track. Use a block and the blade to compress the track cylinder if need be.

* Raise the 3 point hitch lift arms to highest position.

* Shut down motor. Drain the fuel tank and final drive: you can carry on while they drain.

* Remove the 3-point hitch lift arm chain limiters from the quadrant (the curved rail under the drawbar). Remove the 3-point hitch lift arms.

* Remove 9/16" retaining bolt from repair side lift cylinder front pin, and pull pin.

* Drive spring retaining pin from repair side lift cylinder rear pin, and pull pin.

* Pull top repair side bolt from rockshaft support at the rear of the dozer.

* String a hand winch and draw up the repair side track. Remove the track retaining link pin. Slowly release the winch to relax the track. Use a cheater or board to conduct the track off the final drive and away from the repair work area.

* Remove the belly pan to final drive bolts, front (with biq square washer), and rear.

* Use a hand winch to lift out the repair side cylinder support: use a cheater to pull the two large bolts on the front of the repair side 3-pt hitch lift cylinder support, above and in front of the rear cross shaft. While working the lift cylinder up and forward, winch the support up and turn it outward to free it from the chassis, while leaving the lift cylinder attached. Tie off the lift cylinder away from the repair site.

* Remove the 8 bolts holding the repair side drive sprocket. Pull sprocket.

* Remove seat. Remove fuel tank. The final drive is now ready to unbolt.

* Once the final drive is exposed, and all the surrounding hardware has been removed, the drive itself can be unbolted. There are a couple of hard to reach bolts that are torqued enough to be a challenge. First, open the top cover from the steering clutch and loosen the brake retaining bolt so the brake band is slack and free of the drum.

* Remove the floor plate (4x 9/16" bolts) under the steering levers to provide access to the interior front bottom belly pan to final drive bolt & big washer. It is easiest to reach from the inside & above. Pull that bolt (3/4"). Pull the rear belly pan to final drive bolt (regular washer) too, it is easy to reach from the bottom rear.

* There are two steering clutch housing to final drive bolts (15/16"), inside just above and between the two belly pan bolts. Break them loose with a socket and drive, then run them out with a pneumatic impact drive.

* The four 1 1/8" rocker arm to final drive bolts are seriously torqued, and will take some effort, unless you have an awsome impact drive. The upper two bolts are special, they have a machined barrel surface with some thinner sections to the bolt and are hard to confuse with other bolts. Be sure to restore them to the correct location during reassembly. The inner bolts can only be reached from under the dozer. Use a 1 1/8" socket on a 3/4" drive, the upper bolt requires a 6" extension, the lower bolt does not. With the drive and socket in place, and the drive ready to turn the bolt, place a small hydraulic jack under the end of the drive handle/lever and use the jack to lift the lever to break loose the bolt. This works for both inside bolts (reassembly will need something similar: use a lever against the belly pan to turn the torque wrench down). The outer bolts can be reached with a 1 1/8" box wrench (lower) and socket (upper) drive, use cheaters to gain the needed leverage.

* Place a hefty jack under the rocker cross beam, just in front of where the final drive is bolted (the bolts just removed, above). It is not needed, but is reassuring to look at. If placed just right during reassembly, the jack will help align the final drive to the rocker shaft.

* The only remaining (6) bolts are on the outside top of the final drive. The third set from the top are 1/2" bolts, and longer. The other 4 are 15/16" bolts and much shorter.

* Pull the 1/2" bolts. Locate two 16"+ long 1/2" all thread rods, and screw them in. Place nuts on the ends. The rods need to be at least 2" longer than the free space from the front of the final drive to the undercarriage rail, as the final drive will travel on these rods to clear the steering clutch. Support the front of the rods by lashing a rope, chain, etc, to each of them just behind the nuts, and use a hand winch to pull up on the rope/chain slightly. Apply enough lift to keep the rods from deflecting down, as they are keeping the final drive's drive shaft from bending the throwout bearing guide tube.

* Pull the top 4 7/8" bolts. There should be no other bolts holding the final drive in place. Inspect the drive to be sure that you have removed all the retaining bolts.

* Use a cheater or lever to nudge the final drive free and start it traveling on the 1/2" threaded rods. Use a long screwdriver or the like and push back the brake band as it tries to follow the final drive forward. Make sure the drive shaft is coming out gracefully and not bearing on the throwout bearing carrier tube nor getting jammed up with the brake band. Adjust the tension on the hand winch supporting the 1/2" threaded rods as needed. Nudge the final drive forward, and push back the brake band until the drive has traveled the full length of the rods and the outside of the final drive is blocked from further travel by the undercarriage rail.

* The final drive now needs to be rotated on the axis of the drive shaft WITHOUT BEARING ON THE CARRIER TUBE. The rotation lifts the bottom of the final drive to the back and up, to where it clears the undercarriage rail and can be removed from the dozer.

* Use webbing or rope. Fit one end through the conveniently located 1/2" hole in the bottom front middle of the hydraulic tank box (pull the two 9/16" bolts holding the cover to see the 1/2" hole). Secure that end of the webbing/rope by knotting it-it will need to hold about 100 lbs or more, so use a good material and check that the 1/2" hole won't cut the webbing/rope. Sling the webbing/rope between the final drive and the steering clutch housings, under the brake drum, to hold up/support the drum. You can use a trick to tighten the rope: open the lid on the hydraulic tank so that it is upright. Tie the unattached end of the sling to the lid's handle with slight tension, and then lower the lid-it should draw up the sling. Adjust until the sling is lifting the final drive by the brake drum, but only enough to hold it up, not so much that it binds the drive shaft or bends the throwout bearing carrier. You may want to load the sling enough that it lifts when the lid is partially closed, to give yourself a little extra lift later in the game if needed by lowering the lid more.

* Once the brake drum sling is holding up the final drive, remove the 1/2" all thread rods, their webbing/rope and supporting winch. There should be nothing retaining the final drive now, just the brake drum supporting sling.

* Use wooden blocks layed on the track and floor to support the front of the final drive, and place a floor jack off center to the front of the base of the final drive-jacking that should spin the final drive on the slung brake drum. You may also want to place a bolt into one of the rear side holes and use a hand winch to help lift/spin the drive. Gently use the jack, blocks, and winches to rotate the final drive about the drive shaft axis, iterate until the final drive clears the undercarriage rail and the drive shaft clears the throwout bearing tube. You may be able to pull the drive shaft out by hand and or pull the clutch pressure plate to release it-you can leave it in place too, and dismantle the clutch later. In either case, the final drive is ready to hoist.

* Attach a chain to the final drive at the rearmost 1/2" hole (two holes down from the top rear). Use a chain hoist/lift/backhoe/3+strong men/whatever and carefully hoist the final drive from the dozer. Take care to free all the slings and winches as the load comes off them onto the hoist, the final drive will want to fall or spin.

* Reassembly is the reverse of the above. Clean everything, clean it again... Do not make this a waste of time and money, Do Not Contaminate the clutch and brake during re-installation. Use a fresh clean sling for the brake drum (or lay clean cloth on the old one) to NOT CONTAMINATE THE BRAKE DRUM during reassembly. Once the brake and clutch are re-adjusted, use a new gasket and permatex the lid down to where NO OIL OR WATER can enter the steering clutch. Never open the cover without a FULL CLEANING FIRST, always reseal the lid with permatex.

Big Ears Ferns Boulder Moss Light Sunlit Flower Canopy Forest Fruit Moss and PuffBalls Morels Eft Red Fall Young Turks Young Pups Getting Bigger Leaf Ear Ice Quants Ice Moss Ice Floes

A Flying Rock Carved By the Wind Downstream Falls to the North Fork A Hole with Rocksicles Mossed Rock Rock Face Rock Roots Ice Troll Snowhenge

Cold Claws Butterfly Parts Predator and Prey Emergence Granpa Butterfly Thoughtless Herbert's Barn Another Old Butterfly Reclaimed Red Eyed Terrapin Red Mushroom Seventeen

How to set up a Secure VNC session using sshd and Shorewall

Many methods for securing VNC on Windows machines use Putty 
(https://www.chiark.greenend.org.uk/~sgtatham/putty/) to manage the 
VPN as a SSH session with port forwarding.   The method shown here 
simplifies the Windows 7 setup and does not use Putty on the workstation.  
Instead, a ssh port on the firewall is forwarded to an internal Linux SSHD server, 
and that server manages the secure tunnel.  The Linux server 
redirects the forwarded VNC ports using Shorewall and DNAT.
VNC clients need an SSH login on the Linux SSHD box.  When they
make the SSH connection to the SSH server, a local port is served on their machine to 
access the VNC hosted session on the Windows 7 machine. 

*NB:  This method does not add security to the local lan.  Other workstations
on the local net inside the firewall might run a packet sniffer to view
the VNC session data.  The sessions within the lan are only secured by the 
VNC session password.  The security here is for external viewers to gain
the local hosts.  Viewers outside the lan use the ssh encrypted VPN tunnel, and 
are quite secure.  Use Putty on the individual Windows workstations, the more
common method, to secure the sessions within the lan.  The method described here
is more appropriate for small lans with users that don't manage Putty well.  It is 
simpler for the user to set up and run than having to also sort out Putty.

* In this example, two Windows 7 (tm) workstations are assigned the IP 
addresses 192.168.1.12 and 192.168.1.13 with a Linux SSHD server that 
resides on their network with its inbound SSH port forwarded from the 
internet gateway to manage the SSH VPN tunnel.


***  W O R K S T A T I O N    S E T U P   ***
* Install VNC server on the workstations.  

  * Go here https://www.tightvnc.com/download.php and download tightVNC 
    for your operating system.
  * Navigate to your browser's download directory so you can see the 
    files listed there.
  * Click 2x on the TightVNC installation routine you just downloaded, 
    e.g.: tightvnc-2.7.10-setup-64bit.msi    
  * OK the next two dialog windows that ask about trusting and running 
    the tightvnc installer
  * Accept the terms of agreement, Click "I accept", then click "Next"
  * Click "next" again, Click "Install" to start the install
  * In a moment, the User Account Control dialog will come up and ask 
    if you want to allow the installer to run, click "Yes".
  * Once the installer is done, click "Finish"

*  Next is the VNC server configuration

  *If you have a "VNC" icon in the lower right corner of the desktop, 
  click on it,  If you do not, click the start button and click the 
  "Start VNC Server" button that should be at the bottom of the list 
  of programs, that will put the "VNC" icon in the lower right. 
  Windows may hide that icon, and you may need to find and click on 
  the little black arrow near the bottom right of the desktop that 
  unhides it to see it.  Now please click on the VNC icon to open 
  the configuration dialog.

  * You should have a dialog window titled "Tight VNC Server Configuration", 
  in that window, for workstation 192.168.1.12, change the "Incoming 
  viewer connections" from 5900 to 5902.  For workstation 192.168.1.13, 
  change the "Incoming viewer connections" from 5900 to 5903.  
  Next click on the "Set" button for the Server password (just below 
  the 5902/3 entry), and set the password to "22222" (use your own
  passwords, but do not lose them), Click on the "Set" button just
  below, to set the Viewer password, and set that password to 
  "22222" as well.  In this example, the 192.168.1.13 station 
  uses the password "33333", in real life use your own unique
  high quality passwords.

* Click OK to close the configuration window. You are done setting 
  up the Windows machine.



***   L I N U X    S S H D    S E T U P   ***
* Install Shorewall (https://shorewall.net/)

* Configure the /etc/shorewall files as: 
  * Interfaces file: "lan     eth0            -               tcpflags,routeback"
  * Rules file:
	"DNAT    $FW     lan:192.168.1.12:5902   tcp     5902"
	"DNAT    $FW     lan:192.168.1.13:5903   tcp     5903"
  * Zones Files: 
	 "fw      firewall"
	 "lan     ipv4"
  * Policy File:  
	 "lan     $FW     ACCEPT          -"
	 "$FW     lan     ACCEPT          -"
	 "all     all     REJECT          info"
* Invoke "shorewall compile" and see if Shorewall compiles without error.
* Invoke "shorewall start; sleep 60; shorewall clear" to test your settings 
  for a minute without being locked out of the system if you have made a mistake.
* Once shorewall is working, invoke it one more time with "shorewall start"
* If you are running Debian Linux, you may need to also edit 
  /etc/default/shorewall and set "Startup = 1".						 
* Configure the /etc/shorewall files to start Shorewall 
    /etc/shorewall/shorewall.conf startup_enabled=yes. 

*  You need to edit the firewall/gateway to setup a port forward.  If you use 
  the default ssh port, 22, forat machinesward that to the SSHD machine.  If you choose
  a different port for ssh, set that port to forward to the SSHD box and edit 
  the SSHD box's configuration in the /etc/sshd.conf file to set the listening port to 
  your chosen inbound ssh port, for example, 20200.  The -p parameter in the ssh calls
  shown below will need that revised port setting.  Leave the -p off for the 
  default port 22.
    
***    R E M O T E   C L I E N T    ***     
  
A word about viewers:  you can use Windows or Linux to view the desktops. The example
below shows how to use Linux.  Windows users would need Putty to set up the
ssh tunneling.  Putty uses the same ports and values as the ssh tool described here.  
There are many VNC viewers.  TightVNC provides one in the same package already 
installed on the host machines, install it without setting up the VNC server to
use a Windows Viewer.  Linux offers several VNC viewers as well, a common one 
being KRDC, the K desktop Remote Desktop Connection tool.
  
* With machines up running Win7 and VNC icon in lower left, a remote inbound 
ssh session can securely host/view their desktops from Linux by:

  ssh -p 20200  -L 5902:192.168.1.12:5902 userid@123.123.123.123  # where -p 20200 
	 is the non-standard ssh port assigned  in the /etc/sshd.conf file.  Leave the -p
	 off if you are using port 22, the default port.  192.168.1.12 is the
	 IP of the Windows 7 workstation, and the 5902  is the port assigned in the 
	 Shorewall configuration, and corresponds to VNC display 2.  See the VNC
	 documentation for more about display numbers and ports.  The userid 
	 is your login ID on the SSHD box, 123.123.123.123 is the IP address of the 
	 site (the IP assigned to your gateway firewall by your ISP).
	 
	 You can suffix a "-N" to the ssh line above to not open a shell on the SSHD machine.  
	 Use Ctrl-C to quit the SSH session in that case, otherwise just exit the shell 
	 as usual to quit.
	 
* Launch a vncviewer as localhost with display :2 and password 22222 to see the 
  192.168.1.12 machine.  
  
* Use the 5903, 192.168.1.13, password 33333 values as above to view the Windows 7
  machine at 192.168.1.13 and launch a vncviewer as localhost :3 password 33333
  
  
***  F I N I S H E D   ***  
  
  
* To close it all down, quit the viewer, exit the ssh session and have the Windows 
  users disable the VNC service on their desktop.  If you don't close the ssh session
  the 5902 (etc) ports are not freed up and will be trouble if you launch a second 
  instance of ssh with the same ports.
  

About OpenWRT UCI Firewall: For most users, the current default OpenWRT UCI firewall manager will be their best choice. For those managing different generations of OpenWRT routers, or those who want to use the same firewall manager on all their Linux based devices, Shorewall may be a better answer.

About Shorewall: The Shoreline firewall is a well designed firewall manager for Linux netfilters (https://www.shorewall.net/shorewall_index.htm#WhatIs). A runtime package, Shorewall-Lite, can be hosted on one device, e.g: an OpenWRT router, but built on another (the "nanny"). Shorewall-Lite is otherwise nearly identical to the full Shorewall package. Shorewall is one of the oldest ongoing Linux netfilter firewall managers around, offering a stable user interface to zone based firewalling across platforms for more than a decade.

Shorewall meshes well with OpenWRT. The other components of UCI/Luci, and tools like the firewall/IP chain report perform as intended. Shorewall or Shorewall-Lite has been available on most OpenWRT releases (WR,BF,AA, etc). This example will use the Shorewall-Lite package.

By design, Shorewall offers the user a script based fine grained startup, runtime, and shutdown sequence. This file based sequence works around the different generations and implementations of run levels and network initializations found in the real world of Linux versions and distributions. Once you have developed a set of networks, routes, zones, rules and policies, you can readily duplicate those across all your Shorewall installations on those networks. Shorewall is a single setup and firewall solution that makes extending, altering and managing a heterogeneous system of networks easier. See the bottom of this document for URLs to Shorewall.

If you do not need Shorewall, stick with the OpenWRT UCI firewall. You will likely not get Shorewall support from OpenWRT staff.

Example Installation Firewall zones isolate networks, sub-networks, and individual machines from other networks and nodes. Port traffic is firewalled (blocked) across zones, subject to the policies and rules you define to manage cross zone traffic. For many situations, limiting network access to resources is handy, if not necessary. Constraining infection vectors to their zones advances basic digital hygiene.

The firewall in this example is Procrustean, set to cut off all traffic as a policy. You must set rules to ACCEPT port traffic. Only the ports, networks, and if you like, machine MAC addresses explicitly allowed in the Shorewall rules configuration file will pass traffic between zones. Most firewall policies are more relaxed than this, but such policies make for a good exercise, and with management, good firewalls. Manifestly, you can relax Shorewall policy and rules to allow packets and choose to log, inspect then build DENY rules, for a lighter touch. The firewall in this example has one inbound (net) port open and forwarded to a single workstation in Lan1, all other inbound net connections are dropped. Outbound connections from the Lan zones that meet the rules are connected to the net. In this example the Lan zones are firewalled from one another. You can find additional instruction for a similar example in the Shorewall documentation: https://www.shorewall.net/three-interface.htm

The use of the labels "Lan1" and "Lan2" in this example is inductive, and one can add more zones, e.g.: "Lan3".."LanN", using the first pair as models by editing the Shorewall configuration. The "Lan" label used in the OpenWRT configuration files (below), and it it's permutations ("LAN","LAN_", etc), is arbitrary, and you may use your own naming system for zones, networks, and SSIDs, using the example files found here as a model.

In this example scenario, two distinct groups of users need to share one OpenWRT router. One group is working with secure financial data and public monies in a managed work environment with a fixed group of antiviral scanned PCs and known applications, the second group is an undisciplined revolving public meeting group with all manners and generations of wireless devices with unknown applications, any of which may be a malware vector. This second group also requires certain streaming media access that is not allowed to the first group. Both groups will share a router, firewall, and internet gateway. Each group has a zone to itself, with differing rules based on those zones.

In this example the host router must be Multi-SSID capable. As a demonstration, an ar71xx chip set router is setup as a single 802.11G radio and two VAP WPA2-PSK radio interfaces, two Ethernet interfaces, and a bridge from one of the radio interfaces to one of the Ethernet (LAN1+Eth0), called "br-LAN1". The SSIDs are 'LAN1' and 'LAN2'. VLAN zones could be substituted for the VAP's, but that won't be described here.

LAN1 is this example is the 192.168.1.0/24 net. LAN1, as a member of the firewall zone 'Lan1', allows no dhcp, nor any packets from LAN2 (Shorewall zone Lan2). This example firewall will DNAT forward a single zone, "net", (inbound from the internet) ssh port to Lan1, and has some zone specific firewall rules and policies.

LAN2 is the 192.168.2.0/24 net. LAN2 has a dhcp server, and no firewall prohibitions on the requisite ports (53, 67, 68). LAN2 is the 'Lan2' zone in Shorewall, and has it's own specific firewall rules and policies.

Two more Shorewall zones are defined in this example, the firewall itself ($FW), and the internet (net). Generally, connections can initiate from any zone, but most often, they originate from within the Lan zones (outbound packets), or from the net zone as inbound internet packets. Policies and rules control the permission for traffic to cross the firewall zones.

Software Versions in this example OpenWRT ATTITUDE ADJUSTMENT (12.09, r36088), using "https://downloads.openwrt.org/attitude_adjustment/12.09/ar71xx/generic/", Shorewall-lite version 4.4.27.3, Shorewall version: 4.4.11.6-3

Your versions will likely differ from the examples above, adjust as necessary to conform to your router and current software releases as you work through the below.

To use Shorewall with recent (20130530+) OpenWRT releases (AA, snapshot, etc), one must disable the default OpenWRT UCI firewall, and substitute the Shorewall-Lite package. Shorewall-Lite needs a nanny machine to compile and load the firewall to the OpenWRT (Shorewall-Lite host) router. The nanny will manage all the configuration files and needs a net connection to load the compiled firewall to the OpenWRT host device. The Nanny Setup:

In this example the nanny has the IP 192.168.1.30, but you can assign other values in the Lan1 zone.

Download and install Shorewall (not Shorewall-Lite) on the nanny. The nanny's Shorewall and host's Shorewall-Lite versions should be the same major.minor release. Check the OpenWRT package dir, e.g.:

"https://downloads.openwrt.org/attitude_adjustment/12.09/ar71xx/generic/package/" for the available Shorewall-Lite major.minor release for your router's chip set.

Note the "ar71xx" in the above URL: substitute your router's chip set acronym into the URL, e.g.: ar7, brcm47xx, ramips etcetera, to find the correct package for your router and OpenWRT release. Conform the nanny's Shorewall release to that version.

For general instructions see https://www.shorewall.net/CompiledPrograms.html.

Shorewall offers this regarding the nanny: Note to Debian Users-

If you install using the .deb, you will find that your /etc/Shorewall directory is empty. This is intentional. The released configuration file skeletons may be found on your system in the directory /usr/share/doc/Shorewall/default-config. Simply copy the files you need from that directory to /etc/Shorewall and modify the copies.

If your /etc/Shorewall directory is empty after a vanilla Shorewall install, sort that out before proceeding.

Assert the following in the nanny's /etc/Shorewall.conf

CONFIG_PATH=/usr/share/Shorewall STARTUP_LOG=/var/log/Shorewall-lite-init.log

Make the directory ~/Oexample/ and copy all the /etc/Shorewall files (masq, rules, etc) to it. This is your working directory for the OpenWRT host's firewall configuration, analogous to /etc/Shorewall/. You can choose your own directory name, and substitute it for ~/Oexample/. Edit these files to configure the OpenWRT host's firewall.

First, edit the ~/Oexample/routestopped file to add the IP address of the nanny machine like: eth0 192.168.1.30 source,dest.

Next, construct your ~/Oexample/ Shorewall files. The example below shows a file name header ( init:, interfaces, etc) followed by the contents of the file for each Shorewall file needed in this example. Edit your files to conform to the examples below:

* * * * * * * * * * * * * * * * * *   B E G I N    S H O R E W A L L    C O N F I G     F I L E S    * * * * * * * * * * * * * * * * * * * * 
init:
# Use this file to set the machine state before the firewall starts, 
# e.g: to assure that the internet interface is ready, 
# or to set static routes and the like.  It is very handy to have a common system across the networks to assign routes.
#
# Example-uncomment the ## lines below to delay Shorewall while a tardy DSL gateway negotiates it's IP,
# & to assert static routes through .1.7 to .5.0, .51.0, and .51.0 
#
# example workaround DSL not starting before firewall
##/sbin/ifup ppp0
##sleep 5
# example set up static routes example (add a system of networks, use .1.7 as it's gateway)
##route add -net 192.168.5.0 netmask 255.255.255.0 gw 192.168.1.7 
##route add -net 192.168.50.0 netmask 255.255.255.0 gw 192.168.1.7
##route add -net 192.168.51.0/24 gw 192.168.1.7
#LAST LINE -- ADD YOUR ENTRIES BEFORE THIS ONE -- DO NOT REMOVE

interfaces:
#ZONE   INTERFACE       BROADCAST       OPTIONS
net     eth1
lan1    br-LAN1
lan2    wlan0-1

masq:
#INTERFACE:DEST         SOURCE          ADDRESS         PROTO   PORT(S) IPSEC   MARK    USER/
#                                                                                       GROUP
eth1            br-LAN1
eth1            wlan0-1

policy:
#SOURCE DEST    POLICY          LOG     LIMIT:          CONNLIMIT:
$FW    net     DROP    info
lan1   all     REJECT  info
lan2   all     REJECT  info
net    all     DROP
all    all     DROP

routestopped:
#INTERFACE      HOST(S)                 OPTIONS         PROTO   DEST    SOURCE
#                                                               PORT(S) PORT(S)
br-LAN1 192.168.1.3  source,dest

rules:
#SECTION ESTABLISHED
#SECTION RELATED
SECTION NEW

#ftp fw to net (for updates, uncomment only as needed)
##ACCEPT        $FW     net     tcp     ftp     -       -       -       -
#http, https: fw to net (blocked outbound)
##ACCEPT        $FW     net     tcp     http    -       -       -       - 
##ACCEPT        $FW     net     tcp     https   -       -       -       - 

ACCEPT  lan1    net                     tcp     82       	# XFER Utility (TCP/UDP)
DNAT    net     lan1:192.168.1.3:22     tcp     53260    	# inbound ssh on oddball port (53260), bound to a single machine
ACCEPT  lan1    net     tcp     53260   -       -       -       -  #outbound nanny ssh, also on oddball port 

# Use first rules for lower latency-streaming
ACCEPT lan1    net     tcp     554 - # realaudio-outbound tcp
ACCEPT lan1    net     tcp     7070 - # realaudio-outbound tcp
ACCEPT lan1    net     tcp     7071 - # realaudio
ACCEPT lan1    net     tcp     8080 - # realaudio-outbound tcp
ACCEPT lan1    net     tcp     8081 - # realaudio
ACCEPT lan1    net     tcp     rtsp - # realaudio-outbound call                                  
ACCEPT lan2    net     tcp     554 - # realaudio-outbound tcp
ACCEPT lan2    net     tcp     7070 - # realaudio-outbound tcp
ACCEPT lan2    net     tcp     7071 - # realaudio
ACCEPT lan2    net     tcp     8080 - # realaudio-outbound tcp
ACCEPT lan2    net     tcp     8081 - # realaudio
ACCEPT lan2    net     tcp     rtsp - # realaudio-outbound call                                  
ACCEPT lan1    net     tcp     8000:8003 - #realaudio-outbound tcp
ACCEPT lan1    net     udp     8000:8003 - # realaudio-outbound tcp
ACCEPT lan2    net     tcp     8000:8003 - #realaudio-outbound tcp
ACCEPT lan2    net     udp     8000:8003 - # realaudio-outbound tcp
ACCEPT lan1     net     tcp     1755    -       #windowsmedia
#ACCEPT net     lan1    tcp     1755    -       #windowsmedia
ACCEPT lan2    net     tcp     1755    -       #windowsmedia
#ACCEPT net     lan2   tcp     1755    -       #windowsmedia
ACCEPT  lan1    net     udp     53      -       -       -       -          #dns
ACCEPT  lan1    net     tcp     53      -       -       -       -          #dns
ACCEPT  lan2    net     udp     53      -       -       -       -          #dns
ACCEPT  lan2    net     tcp     53      -       -       -       -          #dns
ACCEPT  lan1    $FW     tcp     53      -       -       -       -          #dns
ACCEPT  lan1    $FW     udp     53      -       -       -       -          #dns
ACCEPT  lan2    $FW     tcp     53      -       -       -       -          #dns
ACCEPT  lan2    $FW     udp     53      -       -       -       -          #dns
ACCEPT  $FW     net     tcp     53      -       -       -       -          #dns
ACCEPT  $FW     net     udp     53      -       -       -       -          #dns
ACCEPT  $FW     lan1    tcp     53      -       -       -       -          #dns
ACCEPT  $FW     lan1    udp     53      -       -       -       -          #dns
ACCEPT  $FW     lan2    tcp     53      -       -       -       -          #dns
ACCEPT  $FW     lan2    udp     53      -       -       -       -          #dns
#ACCEPT  lan1    net     udp     67:68      -       -       -       -          #dhcp 
#ACCEPT  lan2    net     udp     67:68      -       -       -       -          #dhcp
ACCEPT  lan1    $FW     udp     67:68      -       -       -       -          #dhcp
ACCEPT  lan2    $FW     udp     67:68      -       -       -       -          #dhcp
ACCEPT  $FW     net     udp     67:68      -       -       -       -          #dhcp
ACCEPT  $FW     lan1    udp     67:68      -       -       -       -          #dhcp
ACCEPT  $FW     lan2    udp     67:68      -       -       -       -          #dhcp

# smb: lan1 <-> $FW
ACCEPT  lan1    $FW     tcp     137:139         -       -       -       -  #Enable SMB on LAN1
ACCEPT  lan1    $FW     tcp     443     -       -       -       -  #http protocol over TLS/SSL
ACCEPT  $FW     lan1    tcp     137:139         -       -       -       -  #Enable SMB on LAN1
ACCEPT  $FW     lan1    tcp     443     -       -       -       -  #http protocol over TLS/SSL
# smb: lan2 <-> $FW
#ACCEPT  lan2    $FW     tcp     137:139         -       -       -       -  #Enable SMB on LAN1
#ACCEPT  lan2    $FW     tcp     443     -       -       -       -  #http protocol over TLS/SSL
#ACCEPT  $FW     lan2    tcp     137:139         -       -       -       -  #Enable SMB on LAN1
#ACCEPT  $FW     lan2    tcp     443     -       -       -       -  #http protocol over TLS/SSL

#web: outbound (lan to net)  http, https, ssh, ftp, time, imap
ACCEPT  lan1    net     tcp     http    -       -       -       -
ACCEPT  lan1    net     tcp     https   -       -       -       -
ACCEPT  lan1    net     tcp     443     -       -       -       -  #http protocol over TLS/SSL
ACCEPT  lan1    net     tcp     ssh     -       -       -       -
ACCEPT  lan1    net     tcp     ftp     -       -       -       -     
ACCEPT  lan1    net     tcp     nntp    -       -       -       -
ACCEPT  lan1    net     tcp     37      -       -       -       -  #nttp timesync
ACCEPT  lan1    net     tcp     imap    -       -       -       -
ACCEPT  lan2    net     tcp     http    -       -       -       -
ACCEPT  lan2    net     tcp     https   -       -       -       -
ACCEPT  lan2    net     tcp     443     -       -       -       -
ACCEPT  lan2    net     tcp     ssh     -       -       -       -
ACCEPT  lan2    net     tcp     ftp     -       -       -       -     
ACCEPT  lan2    net     tcp     nntp    -       -       -       -
ACCEPT  lan2    net     tcp     37      -       -       -       -
ACCEPT  lan2    net     tcp     imap    -       -       -       -
ACCEPT  lan1    net     udp     http    -       -       -       -
ACCEPT  lan1    net     udp     https   -       -       -       -
ACCEPT  lan1    net     udp     443     -       -       -       -
ACCEPT  lan1    net     udp     ssh     -       -       -       -
ACCEPT  lan1    net     udp     37      -       -       -       -
ACCEPT  lan1    net     udp     imap    -       -       -       -
ACCEPT  lan2    net     udp     http    -       -       -       -
ACCEPT  lan2    net     udp     https   -       -       -       -
ACCEPT  lan2    net     udp     443     -       -       -       -
ACCEPT  lan2    net     udp     ssh     -       -       -       -
ACCEPT  lan2    net     udp     37      -       -       -       -
ACCEPT  lan2    net     udp     imap    -       -       -       -
#ACCEPT lan1    net     tcp     6667 - # irc
#ACCEPT lan1    net     udp     6667 - # irc
ACCEPT lan2    net     tcp     6667 - # irc
ACCEPT lan2    net     udp     6667 - # irc

ACCEPT lan1 net tcp 993           # imap4 protocol over TLS | SSL (TCP/UDP) (secure telnet)
ACCEPT lan1 net udp 993

ACCEPT lan1              net     tcp     11371          #OpenPGP HTTP key server
ACCEPT lan1              net     udp     11371          #OpenPGP HTTP key server
ACCEPT lan1              net     tcp     6420           #OpenPGP HTTP key server
ACCEPT lan1              net     udp     6420           #OpenPGP HTTP key server
ACCEPT  lan1            net     udp     123     -       -       -       -#  check time
ACCEPT  lan1            net     tcp     123     -       -       -       -#  check time
ACCEPT lan2            net     udp     123     -       -       -       - #  check time
ACCEPT lan2            net     tcp     123     -       -       -       - #  check time
ACCEPT  $FW             net     udp     123     -       -       -       -#  check time
ACCEPT  $FW             net     tcp     123     -       -       -       -#  check time

#mail
#ACCEPT $FW     net     tcp     pop3    -       -       -       -
ACCEPT  lan1    net     tcp     pop3    -       -       -       -
ACCEPT lan2    net     tcp     pop3    -       -       -       -
#ACCEPT  $FW     net     tcp     smtp    -       -       -       -
ACCEPT  lan1    net     tcp     smtp    -       -       -       -
ACCEPT lan2    net     tcp     smtp    -       -       -       -
#fw mail IP when chg rqrs port 25
#ACCEPT $FW     net     tcp     25      -       -       -       -
#ACCEPT $FW             net             tcp     80      -       -       -       -
#ACCEPT $FW             net             udp     80              -       -       -
DROP    $FW             net             tcp     80      -       -       -       -	#explicitly kill $FW outbound to net on port 80
DROP    $FW             net             udp     80              -       -       -
DROP    net             $FW             tcp     80      -       -       -       -
DROP    net             $FW             udp     80              -       -       -
#mail

#authent
DROP    net     $FW     tcp     113     -       -       -       - #
#ACCEPT net     $FW     tcp     113     -       -       -       -

#ping: fw to lanx, lanx to net & fw, lanx to lany
ACCEPT  $FW     lan1    icmp    8       -       -       -       -
ACCEPT $FW     lan2    icmp    8       -       -       -       -
ACCEPT  lan1    $FW     icmp    8       -       -       -       -
ACCEPT lan2    $FW     icmp    8       -       -       -       -
ACCEPT  lan1    net     icmp    8       -       -       -       -
ACCEPT lan2    net     icmp    8       -       -       -       -

ACCEPT  $FW     net     tcp     ssh     -       -       -       -  #Enable FW to SSH out
ACCEPT  $FW     net     udp     ssh     -       -       -       -  

# ssh: lan1 to/from fw on std ports
ACCEPT  $FW     lan1    tcp     ssh     -       -       -       -
ACCEPT  $FW     lan1    udp     ssh     -       -       -       -
ACCEPT  lan1    $FW     tcp     ssh     -       -       -       -
ACCEPT  lan1    $FW     udp     ssh     -       -       -       -

# httpd/s on fw visible only to lan1
ACCEPT  lan1    $FW     tcp     http    -       -       -       -
ACCEPT lan1    $FW     udp     http    -       -       -       -
ACCEPT  lan1    $FW     tcp     https   -       -       -       -
ACCEPT  lan1    $FW     udp     https   -       -       -       -

#==============================================================
#LAST LINE -- ADD YOUR ENTRIES BEFORE THIS ONE -- DO NOT REMOVE
            

zones:
#ZONE 
fw        firewall
net      ipv4          #Internet
lan1    ipv4
lan2    ipv4


Shorewall.conf: 
Is largely default, tho you may need to set the startup var to 1.
* * * * * * * * * * * * * * * * * *   E O F    S H O R E W A L L    C O N F I G     F I L E S    * * * * * * * * * * * * * * * * * * * * * *

The OpenWRT Host Setup

    Setup the OpenWRT host. See the wiki (https://wiki.openwrt.org/toh/start) for your specific hardware, and flash the OpenWRT host router.

Use UCI/Luci setup (https://wiki.openwrt.org/doc/uci) to setup IP addressing on the router (see below):

Wan 192.168.11.1                                                                                                          
Lan 192.168.10.1                                                                                                          
LAN_1 192.168.13.1                                                                                                       
LAN_2 192.168.2.1                                                                                                 
br-LAN1 192.168.1.1                                                                                                                                                                                                                                                       

* * * * * * * * * * * * * * * * * *   B E G I N    O P E N W R T    C O N F I G     F I L E S    * * * * * * * * * * * * * * * * * * * * * *
#Working configs to boot up OpenWRT router w/ AA 12.09

Interfaces defined by Luci:
br-LAN1 Link encap:Ethernet  HWaddr 00:26:5A:D2:33:77  
          inet addr:192.168.1.1  Bcast:192.168.1.255  Mask:255.255.255.0
          UP BROADCAST RUNNING MULTICAST  MTU:1500  Metric:1
          RX packets:513 errors:0 dropped:0 overruns:0 frame:0
          TX packets:0 errors:0 dropped:0 overruns:0 carrier:0
          collisions:0 txqueuelen:0 
          RX bytes:64859 (63.3 KiB)  TX bytes:0 (0.0 B)

eth0      Link encap:Ethernet  HWaddr 00:26:5A:D2:33:77  
          inet addr:192.168.1.1  Bcast:192.168.1.255  Mask:255.255.255.0
          UP BROADCAST RUNNING MULTICAST  MTU:1500  Metric:1
          RX packets:248895 errors:0 dropped:0 overruns:0 frame:0
          TX packets:232281 errors:0 dropped:0 overruns:0 carrier:0
          collisions:0 txqueuelen:1000 
          RX bytes:36434590 (34.7 MiB)  TX bytes:21143615 (20.1 MiB)
          Interrupt:5 

eth1      Link encap:Ethernet  HWaddr 00:26:5A:D2:33:76  
          inet addr:192.168.11.1  Bcast:192.168.11.255  Mask:255.255.255.0
          UP BROADCAST MULTICAST  MTU:1500  Metric:1
          RX packets:0 errors:0 dropped:0 overruns:0 frame:0
          TX packets:0 errors:0 dropped:0 overruns:0 carrier:0
          collisions:0 txqueuelen:1000 
          RX bytes:0 (0.0 B)  TX bytes:0 (0.0 B)
          Interrupt:4 

lo        Link encap:Local Loopback  
          inet addr:127.0.0.1  Mask:255.0.0.0
          UP LOOPBACK RUNNING  MTU:16436  Metric:1
          RX packets:1277856 errors:0 dropped:0 overruns:0 frame:0
          TX packets:1277856 errors:0 dropped:0 overruns:0 carrier:0
          collisions:0 txqueuelen:0 
          RX bytes:86894208 (82.8 MiB)  TX bytes:86894208 (82.8 MiB)

wlan0     Link encap:Ethernet  HWaddr 00:26:5A:D2:33:76  
          inet addr:192.168.13.1  Bcast:192.168.13.255  Mask:255.255.255.0
          UP BROADCAST RUNNING MULTICAST  MTU:1500  Metric:1
          RX packets:0 errors:0 dropped:0 overruns:0 frame:0
          TX packets:3 errors:0 dropped:0 overruns:0 carrier:0
          collisions:0 txqueuelen:32 
          RX bytes:0 (0.0 B)  TX bytes:192 (192.0 B)

wlan0-1   Link encap:Ethernet  HWaddr 02:26:5A:D2:33:77  
          inet addr:192.168.2.1  Bcast:192.168.2.255  Mask:255.255.255.0
          UP BROADCAST RUNNING MULTICAST  MTU:1500  Metric:1
          RX packets:0 errors:0 dropped:0 overruns:0 frame:0
          TX packets:1 errors:0 dropped:0 overruns:0 carrier:0
          collisions:0 txqueuelen:32 
          RX bytes:0 (0.0 B)  TX bytes:420 (420.0 B)


Firewall:		#<===== These are temporary and will be overwritten when Shorewall-lite loads.	
config defaults
        option syn_flood '1'
        option input 'ACCEPT'
        option output 'ACCEPT'
        option forward 'ACCEPT'

config zone				
        option name 'lan'
        option network 'lan' 'LAN_1' 'LAN_2'
        option input 'ACCEPT'
        option output 'ACCEPT'
        option forward 'ACCEPT'
        
config zone						
        option name 'wan'
        option network 'wan' 
        option input 'ACCEPT'
        option output 'ACCEPT'
        option forward 'ACCEPT'        

config include
        option path '/etc/firewall.user'

Wireless:
config wifi-device 'radio0'
        option type 'mac80211'
        option macaddr '00:26:5a:d2:43:71'
        option hwmode '11ng'
        option htmode 'HT20'
        list ht_capab 'SHORT-GI-40'
        list ht_capab 'TX-STBC'
        list ht_capab 'RX-STBC1'
        list ht_capab 'DSSS_CCK-40'
        option channel '1'
        option txpower '20'
        option country 'US'

config wifi-iface
        option device 'radio0'
        option encryption 'psk2'
        option mode 'ap'
        option key 'ThisIsSupposedToBeASecretPassphrase'
        option ssid 'LAN1'
        option network 'LAN_1'

config wifi-iface
        option device 'radio0'
        option mode 'ap'
        option ssid 'LAN2'
        option network 'LAN_2'
        option encryption 'psk2'
        option key 'ThisOneIsAlsoSupposedToBeASecret'
       
network:
config interface 'loopback'
        option ifname 'lo'
        option proto 'static'
        option ipaddr '127.0.0.1'
        option netmask '255.0.0.0'

config interface 'lan'
        option ifname 'eth0'
        option proto 'static'
        option ipaddr '192.168.10.1'
        option netmask '255.255.255.0'

config interface 'wan'
        option ifname 'eth1'
        option proto 'static'
        option ipaddr '192.168.11.1'
        option netmask '255.255.255.0'

config switch
        option name 'eth0'
        option reset '1'

config switch_vlan
        option device 'eth0'
        option vlan '1'
        option ports '0 1 2 3 4'
        option vid '1'

config interface 'LAN_1'
        option proto 'static'
        option ifname 'wlan0'
        option ipaddr '192.168.13.1'
        option netmask '255.255.255.0'

config interface 'LAN_2'
        option proto 'static'
        option ipaddr '192.168.2.1'
        option netmask '255.255.255.0'
        option _orig_ifname 'wlan0'
        option _orig_bridge 'false'

config interface 'all_COM'
        option type 'bridge'
        option proto 'static'
        option ifname 'eth0'
        option ipaddr '192.168.1.1'
        option netmask '255.255.255.0'
        option dns '123.231.132.213'       <=  ASSIGN YOUR ISP's DNS HERE
        
System:
config system
        option hostname 'COM_ap'
        option zonename 'UTC'
        option timezone 'GMT0'
        option conloglevel '8'
        option cronloglevel '8'

config timeserver 'ntp'
        list server '0.OpenWRT.pool.ntp.org'
        list server '1.OpenWRT.pool.ntp.org'
        list server '2.OpenWRT.pool.ntp.org'
        list server '3.OpenWRT.pool.ntp.org'
        option enable_server '1'

config led 'led_wan'
        option name 'WAN'
        option sysfs 'd-link:green:wan'
        option trigger 'netdev'
        option dev 'eth1'
        option mode 'link tx rx'

config led 'led_lan1'
        option name 'LAN1'
        option sysfs 'd-link:green:lan1'
        option trigger 'switch0'
        option port_mask '0x02'

config led 'led_lan2'
        option name 'LAN2'
        option sysfs 'd-link:green:lan2'
        option trigger 'switch0'
        option port_mask '0x04'

config led 'led_lan3'
        option name 'LAN3'
        option sysfs 'd-link:green:lan3'
        option trigger 'switch0'
        option port_mask '0x08'

config led 'led_lan4'
        option name 'LAN4'
        option sysfs 'd-link:green:lan4'
        option trigger 'switch0'
        option port_mask '0x10'      
* * * * * * * * * * * * * * * * * *   E O F    O P E N W R T    C O N F I G     F I L E S    * * * * * * * * * * * * * * * * * * * * * *

  uci show dropbear
        option PasswordAuth 'on'
        option Port '22'
        option Interface 'br-LAN1'  

  Edit /etc/config/dropbear to repair as needed and then run   uci commit    when done.

    From the host OpenWRT router, create and copy the Shorewall capabilities file to the nanny:


cd /usr/share/Shorewall-lite
./shorecap >/tmp/capabilities
scp /tmp/capabilities [Your Home Directory Here]@192.168.1.30:~/Oexample/.

    Check the work, sort out your recovery route (fail-safe mode, etc) in case you need it.

root@192.168.1.1's password: 
root@192.168.1.1's password: 
Compiling...
Processing ~/Oexample/params ...
Processing ~/Oexample/Shorewall.conf...
   WARNING: Unknown capability (RAWPOST_TABLE) ignored : ~/Oexample/capabilities (line 26)
   WARNING: Unknown capability (ULOG_TARGET) ignored : ~/Oexample/capabilities (line 50)
   WARNING: Unknown capability (NFLOG_TARGET) ignored : ~/Oexample/capabilities (line 51)
   WARNING: Unknown capability (CONDITION_MATCH) ignored : ~/Oexample/capabilities (line 61)
   WARNING: Unknown capability (IPTABLES_S) ignored : ~/Oexample/capabilities (line 62)
   WARNING: Unknown capability (BASIC_FILTER) ignored : ~/Oexample/capabilities (line 63)
   WARNING: Unknown capability (CT_TARGET) ignored : ~/Oexample/capabilities (line 64)
Compiling ~/Oexample/zones...
Compiling ~/Oexample/interfaces...
Determining Hosts in Zones...
Locating Action Files...
Compiling /usr/share/Shorewall/action.Drop for chain Drop...
Compiling /usr/share/Shorewall/action.Broadcast for chain Broadcast...
Compiling /usr/share/Shorewall/action.Invalid for chain Invalid...
Compiling /usr/share/Shorewall/action.NotSyn for chain NotSyn...
Compiling /usr/share/Shorewall/action.Reject for chain Reject...
Compiling ~/Oexample/policy...
Running ~/Oexample/initdone...
Compiling Kernel Route Filtering...
Compiling Martian Logging...
Compiling ~/Oexample/masq...
   WARNING: Using an interface as the masq SOURCE requires the interface to be up and configured when Shorewall starts/restarts : ~/Oexample/masq (line 12)
Compiling MAC Filtration -- Phase 1...
Compiling ~/Oexample/rules...
Compiling MAC Filtration -- Phase 2...
Applying Policies...
Generating Rule Matrix...
Creating iptables-restore input...
Compiling ~/Oexample/routestopped...
Shorewall configuration compiled to ~/Oexample/firewall
Copying ~/Oexample/firewall and ~/Oexample/firewall.conf to 192.168.1.1:/etc/shorewall-lite/state...
root@192.168.1.1's password: 
firewall                                                                                   100%   69KB  69.3KB/s   00:00    
firewall.conf                                                                              100%  981     1.0KB/s   00:00    
Copy complete
root@192.168.1.1's password: 
System 192.168.1.1 loaded

!!! 
************************************
* To Start:  TEST OUTBOUND PORT 25
************************************
!!!
* FIRST:  Pick a known working internet mail server.  Substitute its name or IP address below, where you see"mail.goodexample.com",
 then run this command from a machine that is not firewalled from port 25:
  tcptraceroute mail.goodexample.com 25
* If that trace does not end with your known working mail server (e.g.: mail.goodexample.com),
 port 25 outbound is blocked and you will NOT BE ABLE TO SEND INTERNET MAIL on port 25.
  You can receive it, and manage local mail, but until that port is open, you cannot send out internet mail.
!!! 

Example of a FAILED (blocked) trace on port 25  <== Results like this mean your port 25 outbound is
 blocked and you will NOT be able to send internet email.  The sent email will fail with little or no notice.
 1  192.168.1.1 (192.168.1.1)  0.668 ms  0.652 ms  0.675 ms
 2  123.123.123.123 (123.123.123.123)  2.487 ms  2.501 ms  2.507 ms
 3  * * *
 4  * * *
 5  * * *
 6  * * *
 7  * * *
 ...
28  * * *
29  * * *
30  * * *

 
 
************************************
*  SHOREWALL FIREWALL & DYNAMIC IP MANAGEMENT
*   Run on firewall
************************************
* dmzone is the DMZ internet available servers zone, firewalled from everything,
 with explicit exceptions

* Edit /etc/shorewall/rules
#ddclient
ACCEPT<>$FW<--->net:123.123.123.123<---->tcp<--->https		<=== Replace 123.123.123.123 with your
 Domain Registry's Dynamic DNS Server IP Address,  the address you set in the ddclient config 

#### HTTP Port Forwards to DMZ #####
#inbound net http.
DNAT    net     dmzone:192.168.2.10:80<-->tcp<--->80...
DNAT    net     dmzone:192.168.2.10:80   udp      80

#************
#DMZ & Local1 visibility
#***********

#imap & imaps
#imap
DNAT    net     dmzone:192.168.2.10:143<->tcp<--->143...
#imaps
DNAT    net     dmzone:192.168.2.10:993<->tcp<--->993...
DNAT    net     dmzone:192.168.2.10:587<->tcp<--->587...
ACCEPT  dmzone<-->net<--->tcp<--->587<--->-

ACCEPT<>dmzone<-->local1<-->tcp<--->143<--->-
ACCEPT<>dmzone<-->local1<-->tcp<--->993<--->-

ACCEPT<>local1<-->dmzone<-->tcp<--->143<--->-
ACCEPT<>local1<-->dmzone<-->tcp<--->993<--->-

ACCEPT<>dmzone<-->local1<-->tcp<--->587<--->-
ACCEPT<>local1<-->dmzone<-->tcp<--->587<--->-

#SMTP
ACCEPT  dmzone<-->local1<-->tcp<--->25<---->-
ACCEPT  local1<-->dmzone<-->tcp<--->25<---->-
ACCEPT  dmzone<-->net<--->tcp<--->25<---->-

# SMTP mail server<---->
DNAT    net     dmzone:192.168.2.10:25<-->tcp<--->25

#SMTPS
ACCEPT  dmzone<-->local1<-->tcp<--->465<--->-
ACCEPT  local1<-->dmzone<-->tcp<--->465<--->-
ACCEPT  dmzone<-->net<--->tcp<--->465<--->-
DNAT    net     dmzone:192.168.2.10:465<->tcp<--->465

#### EOF DMZ Port Forwards ####

#NNTP
#ACCEPT  dmzone<->net<--->tcp<--->119<--->-
#ACCEPT  net<-->dmzone<-->tcp  <->119<--->-
ACCEPT  dmzone<-->net<--->udp<--->123<--->-
ACCEPT  net<--->dmzone<-->udp  <->123<--->-

#NNTPS
ACCEPT  dmzone<-->net<--->tcp<--->563<--->-
ACCEPT  net<--->dmzone<-->tcp  <->563<--->-

#ssh http ping dmzone <--> local1
ACCEPT  dmzone<-->local1<-->icmp<-->8<----->-
ACCEPT  local1<-->dmzone<-->tcp<--->ssh<--->-
ACCEPT  local1    dmzone<-->udp  <->ssh<--->-
ACCEPT  local1<-->dmzone<-->tcp<--->http<-->-
ACCEPT  local1    dmzone<-->udp  <->http<-->-
ACCEPT  local1<-->dmzone<-->icmp<-->8<----->-

#spamd
##ACCEPT  dmzone<-->net<--->tcp<--->2703<-->
#

#ssh http ping dmzone <--> net
ACCEPT  dmzone<-->net<--->tcp<--->ssh<--->-
ACCEPT  dmzone    net<--->udp  <->ssh<--->-
ACCEPT  dmzone<-->net<--->tcp<--->http<-->-
ACCEPT  dmzone    net<--->udp  <->http<-->-
ACCEPT  dmzone<-->net<--->tcp<--->https<->-
ACCEPT  dmzone<-->net<--->udp  <->https<->-
ACCEPT  dmzone<-->net<--->icmp<-->8<----->-
ACCEPT  dmzone<-->net<--->udp<--->53<---->-


************************************
* Edit /etc/ddclient.conf: 	<===This example shows namecheap.com,
 replace it with your own Dynamic DNS service, and set their IP in the line "#ddclient ACCEPT<>$FW<--->net:123.123.123.123<---->tcp<--->http" above
	                                                                                                                                                                   
protocol=namecheap
use=if, if=ppp0
pid=/var/run/ddclient.pid
cache=/tmp/ddclient.cache
daemon=300
syslog=yes
ssl=yes
server=dynamicdns.park-your-domain.com
login=example.org
password=[A_String_You_Get_From_NameCheap]
@,mail,www

==============================

on Firewall:   /var/log/syslog 
Mar 20 06:54:42 YourFirewall ddclient[4888]: SUCCESS:  updating @: good: IP address set to 123.321.132.321  <+Your current IP address from your ISP 
Mar 20 06:54:42 YourFirewall ddclient[4888]: SUCCESS:  updating mail: good: IP address set to 123.321.132.321
Mar 20 06:54:42 YourFirewall ddclient[4888]: SUCCESS:  updating www: good: IP address set to 123.321.132.321



************************************
*  Setting up Email
*  Run on the DMZ_1 box
************************************
*DDClient manages the dynamic DNS IP settings
*Apache2 web server
*Exim4 is the MTA/mail server, set to use maildir — each message is stored in a separate file within a directory
*Dovecot is the IMAP server
*Various Shorewall rules need to be set.  
*Versions used here:  
*	exim4 V: 4.80-7 
*	dovecot
*	OpenSSH_6.0p1 Debian-4, OpenSSL 1.0.1e 


===============================
Namecheap.com example.org Mail settings:
===============================
Check the box: "user (Mail server's host name rqd"
host name = "@", 
mail server host name "mail.example.org" 
MX pref="10" 
ttl=1800
Sub-Domain setting ="mail"
ip address = current one = "123.123.123.123" <==will get updated by ddclient
A record  ttl = 600  <= main example.org record
ditto for host name = "www"


============================
* Install diagnostic tools
============================
  apt-get install swaks libnet-ssleay-perl
  swaks -a -tls -q HELO -s localhost -au Debian_exim -ap '<>'   <== example test message (won't work yet use freely to test once exim4 has been installed).


===============================
https://wiki.debian.org/Exim
===============================

!!!
READ /usr/share/doc/exim4-base/README.Debian.gz or https://pkg-exim4.alioth.debian.org/README/README.Debian (same doc)
!!!

Add a user "test3" and record the password.  The adduser must create a home dir /home/test3.

Debian's exim4 package has two mutually exlusive config file methods, a monolithic
 template file and a split array of files. The monolithic template single file method is
 used here.  Translate the split files like 00_abc.conf to the macros, or to the rules
 in the template to apply examples for the split file method.


/etc/exim4/exim4.conf.localmacros is read before /etc/exim4/exim4.conf.template

First pass:
  apt-get install exim4-daemon-heavy
  dpkg-reconfigure exim4-config
This writes the configuration to  /etc/exim4/update-exim4.conf.conf

https://wiki.debian.org/MaildirConfiguration

============================ 
dpkg-reconfigure exim4-config
============================  
General type of mail configuration:  internet site; mail is sent and received directly using SMTP.
System mail name: yourdomain.com
IP-addresses to listen on for incomming SMTP connections: // 0.0.0.0 for all, or  leave blank
Other destinations for which mail is accepted:   @.example.org, mail.example.org, example.org
Domains to relay mail for: // leave blank
Machines to relay mail for: // leave blank
Keep number of DNS-queries minimal (Dial-on-Demand) ?: No
Delivery method for local mail: Maildir format in home directory  <== appearently required for imap
Split configuration into small files ? :No

============================
Generate exim.crt and exim.key in /etc/exim4/
============================
* Create a self signed SSL certificate for Exim, sufficient for secure encrypted connections. Buy a trusted certificate for secure identification.
  bash /usr/share/doc/exim4-base/examples/exim-gencert
* Enter the hostname of your MTA at the Common Name (CN) prompt!
    Generating a 1024 bit RSA private key
    .................++++++
    .......................++++++
    writing new private key to '/etc/exim4/exim.key'
    -----
    You are about to be asked to enter information that will be incorporated
    into your certificate request.
    What you are about to enter is what is called a Distinguished Name or a DN.
    There are quite a few fields but you can leave some blank
    For some fields there will be a default value,
    If you enter '.', the field will be left blank.
    -----
    Country Code (2 letters) [US]:
    State or Province Name (full name) []:YourState
    Locality Name (eg, city) []:YourCity
    Organization Name (eg, company; recommended) []:example
    Organizational Unit Name (eg, section) []:exim_example
    Server name (eg. ssl.domain.tld; required!!!) []:example.org        
    Email Address []:exim@example.org
* Done generating self signed certificates for exim.  
Refer to the documentation and example configuration files



***********************
*  Test basic installation
***********************
*exim -bV will show the configuration file in use is /var/lib/exim4/config.autogenerated
 exim4 -bV
    Exim version 4.80 #2 built 02-Jan-2013 18:59:17
    Copyright (c) University of Cambridge, 1995 - 2012
    (c) The Exim Maintainers and contributors in ACKNOWLEDGMENTS file, 2007 - 2012
    Berkeley DB: Berkeley DB 5.1.29: (October 25, 2011)
    Support for: crypteq iconv() IPv6 PAM Perl Expand_dlfunc GnuTLS move_frozen_messages Content_Scanning DKIM Old_Demime
    Lookups (built-in): lsearch wildlsearch nwildlsearch iplsearch
 cdb dbm dbmjz dbmnz dnsdb dsearch ldap ldapdn ldapm mysql nis
 nis0 passwd pgsql sqlite
    Authenticators: cram_md5 cyrus_sasl dovecot plaintext spa
    Routers: accept dnslookup ipliteral iplookup manualroute queryprogram redirect
    Transports: appendfile/maildir/mailstore/mbx autoreply lmtp pipe smtp
    Fixed never_users: 0
    Size of off_t: 8
    Configuration file is /var/lib/exim4/config.autogenerated

*Use awaks to generate a test email
  swaks -f test3@example.org -t
    To: test3@example.org
    === Trying mail.example.org:25...
    === Connected to mail.example.org.
    <-  220 DmzServerBox1 ESMTP Exim 4.80 Fri, 21 Mar 2014 19:16:54 -0400
    -> EHLO DmzServerBox1
    <-  250-DmzServerBox1 Hello example.org [192.168.2.10]
    <-  250-SIZE 52428800
    <-  250-8BITMIME
    <-  250-PIPELINING
    <-  250 HELP
    -> MAIL FROM:
    <-  250 OK
    -> RCPT TO:
    <-  250 Accepted
    -> DATA
    <-  354 Enter message, ending with "." on a line by itself
    -> Date: Fri, 21 Mar 2014 19:16:53 -0400
    -> To: test3@example.org
    -> From: test3@example.org
    -> Subject: test Fri, 21 Mar 2014 19:16:53 -0400
    -> X-Mailer: swaks v20120320.0 jetmore.org/john/code/swaks/
    -> 
    -> This is a test mailing
    -> 
    -> .
    <-  250 OK id=1WR8gI-00041z-4k
    -> QUIT
    <-  221 DmzServerBox1 closing connection
    === Connection closed with remote host.


Without TLS, the local mail works.  The Maildir receives the test3 emails sent by 'mail' or 'swaks' on the LOCAL machine (DmzServerBox1), but 
NOT using 'mail' as a local send from another local workstation to test3@example.org


============================
* handy exim4 debug command
============================
  /etc/init.d
  ./exim4 stop
  exim4 -bd -d

!!!
*  DO NOT DO THIS PART UNTIL EXIM IS WORKING WITHOUT TLS
!!!
{{{{{{{{{{{{{{{{{{{{{{{{{{{{{{{{{{{{{{{{{{{{{{{{{{{{{{{


============================
*  Enable TLS support in mail transfer agent
*  Use exim4.conf.localmacros, per /usr/share/doc/exim4-base/ 
============================
  nano /etc/exim4/exim4.conf.localmacros  
*  add the following lines  (the tls_on_connect_ports... supports borked MS mailer tls)
     MAIN_TLS_ENABLE = yes
     tls_on_connect_ports = 465
	
     
  nano /etc/default/exim4
* add the line  (supports borked MS mailer tls)
     SMTPLISTENEROPTIONS='-oX 465:25 -oP /var/run/exim4/exim.pid'
  update-exim4.conf
  cd /etc/init.d
  ./exim4 restart
  exim4 -bV   <== will show the generated config file, ususally /var/lib/exim4/config.autogenerated
  grep tls_on /var/lib/exim4/config.autogenerated  <== will show  "tls_on_connect_ports = 465"
* /var/log/exim4/mainlog should now contain a line like:
  exim 4.80 daemon started: pid=17599, -q30m, listening for SMTP on 
port 25 (IPv6 and IPv4) and for SMTPS on port 465 (IPv6 and IPv4)
          
     
============================ 
* SMTP authentication to access to the sending capabilities of Exim4.
============================
* Set an SMTP username and password in the mail clients (Outlook 2007, Thunderbird etc.)
To authenticate against system passwords (e.g. /etc/shadow) add the exim-user (Debian-exim) to the sasl group. <== This is not a great idea, you 
may want to implement user passwords another way, but for testing this works.  Remove the users from group sasl in that case.
  groupadd sasl Debian-exim dovecot      
  

============================
*Dovecot setup
============================
  viz: https://wiki2.dovecot.org/PasswordDatabase/PAM & 
  https://wiki2.dovecot.org/RunningDovecot
  https://help.ubuntu.com/community/Dovecot

* verify that /etc/pam.d/dovecot contains:
    auth    required        pam_unix.so
    account required        pam_unix.so


============================ 
Edit /etc/exim4/update-exim4.conf.template
============================  
*Insert near the bottom of the file

  dovecot_login:
    driver = dovecot
    public_name = LOGIN
#    server_socket = /var/run/dovecot/auth-userdb
    server_socket = /var/run/dovecot/auth-client
    server_set_id = $auth1

  dovecot_plain:
    driver = dovecot
    public_name = PLAIN
#    server_socket = /var/run/dovecot/auth-userdb
    server_socket = /var/run/dovecot/auth-client
    server_set_id = $auth1
    
============================ 
*Edit the dovecot config files.
============================      
* Edit the file /etc/dovecot/conf.d/10-master.conf and in the service auth { stanza, add
#SASL  (Dovecot auth-client)
  unix_listener auth-client {
    mode = 0666		<==if you sort out the right users and add them
 to the right groups, you can use 0660
    user = mail
    }

* Edit the file /etc/dovecot/conf.d/10-auth.conf and set 
  auth_mechanisms = plain login 

* Edit the file /etc/dovecot/conf.d/10-mail.conf and uncomment (comment
 out the current setting first)
   mail_location = maildir:~/Maildir  

* Edit the file /etc/dovecot/conf.d/10-logging and enable (uncomment & set to yes) authentication,
verbose and debug logs  <== Once working, return to this file and disble logging 

* Edit the file /etc/dovecot/conf.d/10-ssl.conf    
    ssl = yes

*Report where Dovecot logging files are located:
  doveadm log find 
    
*Automatically create the Maildir for future users:   <=== This may be uneccessary, if it proves so, simply delete the /etc/skel/Maildir files later
  maildirmake.dovecot /etc/skel/Maildir 
  maildirmake.dovecot /etc/skel/Maildir/.Drafts 
  maildirmake.dovecot /etc/skel/Maildir/.Sent 
  maildirmake.dovecot /etc/skel/Maildir/.Trash 
  maildirmake.dovecot /etc/skel/Maildir/.Templates    

* Manually create the Maildir for existing users (e.g."myuser"):
  cp -r /etc/skel/Maildir /home/myuser/
  chown -R myuser:usergroup /home/myuser/Maildir
  chmod -R 700 /home/myuser/Maildir  

  
============================ 
*  Testing TLS, SMPT-AUTH, & Dovecot
============================ 

*Handy debugging and information tools:
  telnet localhost imap2		<== Shows IMAP is working and capabilities
    Trying ::1...
    Connected to localhost.
    Escape character is '^]'.
    OK [CAPABILITY IMAP4rev1 LITERAL+ SASL-IR LOGIN-REFERRALS ID 
ENABLE IDLE STARTTLS AUTH=PLAIN] Dovecot ready.
  ^]
    telnet> q
    Connection closed.
 

*Run Exim in the foreground with debugging and assert the config file: <== Very Handy
  exim4 -db -d -C  /var/lib/exim4/config.autogenerated
    
* Add a new user, "test3" (don't set the login to anything, it is safer). You shouldn't need to hand fix any mail directories.  Record the password and use it below.

* Create a new account in Thunderbird, name='test3', email='test3@example.org, password=user account pw, 
Thunderbird will reply "configuration found by trying common server names", 
"incoming: IMAP,mail.example.org, STARTTLS", "outgoing: SMTP, mail.example.org, 
STARTTLS"  

* Add a new user, "test4",  Record the password and use it below.

* Create a new account in Thunderbird, name='test4', email='test4@example.org, password=user account pw

* Use Thunderbird to send an email from test4@example.org to test3@example.org 
 This should work.The account may first warns of the insecure outbound connection,
 and after accepting the self-signed certificate, reports that it can send email.  
* Use the test3 account made above in thunderbird, and 'get mail'. 
 Inspect /home/test3/Maildir/new, the email has arrived to
 the /home/test3/Maildir/new dir and the sent copy was written to /home/test3/mail/Sent.

  /var/log/exim4/mainlog contains  lines like:
    2014-03-22 10:23:15 1WRMpP-0004d3-Ky <= test4@example.org H=([192.168.1.2]) [192.168.1.2] P=esmtps X=TLS1.0:
DHE_RSA_AES_128_CBC_SHA1:128 S=569 	id=532D9CD2.2090308@example.org
    2014-03-22 10:23:15 1WRMpP-0004d3-Ky => test3  R=local_user T=maildir_home

  /var/log/mail.info shows something like:
    Mar 22 11:24:18 DmzServerBox1 dovecot: imap-login: Login: user=, method=PLAIN, rip=192.168.1.2, 
lip=192.168.2.10, mpid=19225, TLS, session=

*Look at the verbose logging in the console where you ran "exim4 -db -d -C  /var/lib/exim4/config.autogenerated",
 you should see in the long list something like "250-AUTH PLAIN LOGIN CRAM_MD5", the "AUTH" tells you that 
exim4 is advertising Authentication. Absent that line, outbound email to the net fails with a 550 Relay error.

* When you are done debugging, kill the "Exim4 -db -d -C /var/lib/exim4/config.autogenerated" instance with ^C, and 
from /etc/init.d invoke "./exim4 start" to restart exim4. 
 Invoke "./dovecot stop" and edit the /etc/dovecot/conf.d/10-logging file to 
comment out the Authentication,
Debugging and verbose lines to disable dovecot logging. 
Now from /etc/init.d invoke "./dovecot start" to restart dovecot.  
You should be in production.
 
!!!
*  EOF  DO NOT DO THIS PART UNTIL EXIM IS WORKING WITHOUT TLS
!!!
}}}}}}}}}}}}}}}}}}}}}}}}}}}}}}}}}}}}}}}}}}}}}}}}}}}}}}}}}}}}}                                                                                                                                                                                                                                                                                                                                                                                 
 

Installer for Asterisk + FreePBX on a Debian machine

Usage: dfreepbx [ -x --xpedite \| -s --setup \| -f --fetch \| -i --install \| -p --passwords \| -h --help]

Example: dfreepbx -x -f -i -p

Xpedite: Fast mode, skips most 'Press Enter' prompts.

Setup: (use 1x only) installs the build and development tools

Fetch: Download and unpack fresh source files.

Install: Build, Install and Configure source files.

Passwords: Set the security and passwords.

Old .conf files are in .conf-orig. Run as root, the script requires access to the Internet. NB: Do _NOT_ change any default passwords UNTIL Part 3: Setting Up Security (invoked with -p). After using -p, set the default password for the root mysql user. By default it is null. From MySQL, invoke: SET PASSWORD FOR 'root'@'localhost' = PASSWORD('');

Once installed, run asterisk+freepbx with: amportal start

Edit this script to set the following versions and filenames:

-> Asterisk = ${VER_ASTERISK},

-> Dahdi = ${VER_DAHDI}

-> Libpri = ${VER_LIBPRI},

-> Addons = ${VER_ADDONS}

-> FreePBX = ${VER_FREEPBX} (+ apache2 php5 mysql5)

-> Log File = ${LOGFILE}

#!/bin/bash
#dfreepbx v0.5 2010.03.30
# == CONTRIBUTERS ==
# Yoann QUERET - yoann@queret.net, https://www.queret.net/asterisk/  
# Serge Berney - s.berney@kinonline.net
# Neil Stone - neil@flashtek-uk.com
# W.S. Herrick - p0g0 at madwifi-project.org
#======================================================================
# Use dfreepbx.sh as root, run as shown:
# chmod 766 dfreepbx.sh
# ./dfreepbx.sh -x -s -f -i -p
#
# The script manages the installation of packages, tools, source and configuration of freepbx.  
# Except for the optional -x, the parameters are ordered as -s then -f then -i then -p.
# Examples:
#  dfreepbx.sh -x -s
#  dfreepbx -x -f 
#  dfreepbx.sh -i -p
#  
# Once the entire "-s -f -i -p" sequence has been completed 1x, you can then use the options in any order. 
#========================================================================
#

LOGFILE="/usr/src/debian-freepbx.log";
echo "Start" | tee ${LOGFILE}
VER_ASTERISK="1.6.2.4"; # 11.5.0
VER_ADDONS="1.6.2.0";  # 1.6.2.4
VER_DAHDI="2.2.1+2.2.1"; #2.7.0+2.7.0
VER_LIBPRI="1.4.10.2"; # 1.4.14
VER_FREEPBX="2.6.0";  # 2.10.0

VER_KERNEL=`uname -r`
DEBIAN_VERSION=`cat /etc/debian_version`
err_state="0"
fast="F"


function fr_setup
{
clear
echo "1x Set up: Essential Build, Security and Development files"  | tee -a ${LOGFILE}
echo "Run once after a fresh debian install."
echo "Press Enter to continue, Ctrl-C Quits"
read
apt-get update
cp -a -x /etc/shorewall /etc/shorewall.orig
cp -a -x /etc/ppp /etc/ppp.orig
apt-get install -y build-essential dbview zip debian-keyring gcc-4.3-locales autoconf automake1.9 libtool bison gdb mc jed iptraf equivs shorewall shorewall-doc lynx pppoe pppstatus pppoeconf xdialog  modconf ppp chkrootkit  unhide clamav xserver-xorg-core xorg kde-core synaptic sux wireshark tshark ntpdate gpm kdiff3 tkdiff | tee -a ${LOGFILE}
# rkhunter
}

function fr_fetch
{
clear
echo "#################################################################"
echo "# PART 1 - Installation of asterisk                              " | tee -a ${LOGFILE}
echo "### ---------------------------------------------------------- ##"
echo "#               Press  to continue                        "
echo "#################################################################"
if  [ "$fast" != "T" ]; then
  read
fi  ##@@

echo "+----------------------------------------------------------------+"
echo "| Downloading the sources to /tmp/asterisk/                      |"| tee -a ${LOGFILE}
echo "+----------------------------------------------------------------+"
echo " Press  to continue"
if  [ "$fast" != "T" ]; then
  read
fi  ##@@
mkdir /tmp/asterisk/
wget -c https://downloads.asterisk.org/pub/telephony/asterisk/releases/asterisk-${VER_ASTERISK}.tar.gz -O  /tmp/asterisk/asterisk-${VER_ASTERISK}.tar.gz | tee -a ${LOGFILE}
wget -c https://downloads.asterisk.org/pub/telephony/dahdi-linux-complete/releases/dahdi-linux-complete-${VER_DAHDI}.tar.gz -O /tmp/asterisk/dahdi-linux-complete-${VER_DAHDI}.tar.gz | tee -a ${LOGFILE}
wget -c https://downloads.asterisk.org/pub/telephony/libpri/releases/libpri-${VER_LIBPRI}.tar.gz -O /tmp/asterisk/libpri-${VER_LIBPRI}.tar.gz | tee -a ${LOGFILE}
wget -c https://downloads.asterisk.org/pub/telephony/asterisk/releases/asterisk-addons-${VER_ADDONS}.tar.gz -O /tmp/asterisk/asterisk-addons-${VER_ADDONS}.tar.gz | tee -a ${LOGFILE}
echo "+----------------------------------------------------------------+"
echo "| Constructing compile environment                               |"| tee -a ${LOGFILE}
echo "+----------------------------------------------------------------+"
echo " Press  to continue"
if  [ "$fast" != "T" ]; then
  read
fi  ##@@
aptitude update

aptitude -y install g++ libncurses5-dev linux-headers-${VER_KERNEL} sqlite libnewt-dev \
libusb-dev zlib1g-dev libmysqlclient15-dev libsqlite0-dev libxml2-dev openssh-server | tee -a ${LOGFILE}


echo "+----------------------------------------------------------------+"
echo "| Configuration of kernel sources                                |"| tee -a ${LOGFILE}
echo "+----------------------------------------------------------------+"
echo " Press  to continue"
if  [ "$fast" != "T" ]; then
  read
fi  ##@@
cd /usr/src/
ln -s /usr/src/linux-headers-${VER_KERNEL} /usr/src/linux
echo "+----------------------------------------------------------------+"
echo "| Decompresion of sources in /usr/src/                           |"
echo "+----------------------------------------------------------------+"
echo " Press  to continue"
if  [ "$fast" != "T" ]; then
  read
fi  ##@@
cd /usr/src/
tar zxvf /tmp/asterisk/asterisk-${VER_ASTERISK}.tar.gz | tee -a ${LOGFILE}
tar zxvf /tmp/asterisk/asterisk-addons-${VER_ADDONS}.tar.gz | tee -a ${LOGFILE}
tar zxvf /tmp/asterisk/libpri-${VER_LIBPRI}.tar.gz  | tee -a ${LOGFILE}
tar zxvf /tmp/asterisk/dahdi-linux-complete-${VER_DAHDI}.tar.gz | tee -a ${LOGFILE}
echo "Fetch and Install Apache and MySql servers" | tee -a ${LOGFILE}
aptitude update
aptitude install -y apache2 php5 php5-cli mysql-server-5.0 php-pear php5-mysql php-db libapache2-mod-php5 php5-gd php5-curl mpg123 | tee -a ${LOGFILE}

echo "+----------------------------------------------------------------+"
echo "| Downloading the FreePBX sources to /tmp/freepbx/                       |"| tee -a ${LOGFILE}
echo "+----------------------------------------------------------------+"
echo " Press  to continue"
if  [ "$fast" != "T" ]; then
  read
fi  ##@@
mkdir /tmp/freepbx/
wget https://mirror.freepbx.org/freepbx-${VER_FREEPBX}.tar.gz -O /tmp/freepbx/freepbx-${VER_FREEPBX}.tar.gz | tee -a ${LOGFILE}

echo "+----------------------------------------------------------------+"
echo "| Extracting the sources for freepbx in /usr/src/                |"
echo "+----------------------------------------------------------------+"
echo " Press  to continue"
if  [ "$fast" != "T" ]; then
  read
fi  ##@@
cd /usr/src
tar zxvf /tmp/freepbx/freepbx-${VER_FREEPBX}.tar.gz | tee -a ${LOGFILE}
echo " End of Step One: Fetching the Source Files." | tee -a ${LOGFILE}
#EOF function fetch
}

function fr_install
{
echo "+----------------------------------------------------------------+"
echo "| Install Step:  Building from the source                                       |" | tee -a ${LOGFILE}
echo "+----------------------------------------------------------------+"
echo " Press  to continue"
if  [ "$fast" != "T" ]; then
  read
fi  ##@@


echo "+----------------------------------------------------------------+"
echo "| Compilation of DAHDI                                           |"| tee -a ${LOGFILE}
echo "+----------------------------------------------------------------+"
echo " Press  to continue"
if  [ "$fast" != "T" ]; then
  read
fi  ##@@
cd /usr/src/dahdi-linux-complete-${VER_DAHDI}
make | tee -a ${LOGFILE}
make install | tee -a ${LOGFILE}
make config | tee -a ${LOGFILE}


echo "+----------------------------------------------------------------+"
echo "| Compilation of libpri                                          |" | tee -a ${LOGFILE}
echo "+----------------------------------------------------------------+"
echo " Press  to continue"
if  [ "$fast" != "T" ]; then
  read
fi  ##@@
cd /usr/src/libpri-${VER_LIBPRI}
make install | tee -a ${LOGFILE}

echo "+----------------------------------------------------------------+"
echo "| Compilation of Asterisk                                        |" | tee -a ${LOGFILE}
echo "+----------------------------------------------------------------+"
echo " Press  to continue"
if  [ "$fast" != "T" ]; then
  read
fi  ##@@
cd /usr/src/asterisk-${VER_ASTERISK}
./configure | tee -a ${LOGFILE}
echo "== ATTENTION =="
echo "If you do not understand this question, choose NO,"
echo "The standard options will be used."
echo "--"

key = "n"  ##@@

if  [ "$fast" != "T" ]; then
  read -n 1 -p "Would you like to select which Asterisk modules to install ? [y/N]" key
fi  ##@@ 

if [ $key == "y" ]; then
	make menuconfig
fi
make | tee -a ${LOGFILE}
make install | tee -a ${LOGFILE}
make samples | tee -a ${LOGFILE}

echo "+----------------------------------------------------------------+"
echo "| Compilation of Asterisk addons                                 |" | tee -a ${LOGFILE}
echo "+----------------------------------------------------------------+"
echo " Press  to continue"
if  [ "$fast" != "T" ]; then
  read
fi  ##@@
cd /usr/src/asterisk-addons-${VER_ADDONS}
./configure | tee -a ${LOGFILE}

echo "== ATTENTION =="
echo "If you do not understand this question, choose NO,"
echo "The standard options will be used."
echo "--"
key = "n"   ##@@
if  [ "$fast" != "T" ]; then
  read -n 1 -p "Would you like to select which Asterisk addons modules to install ? [y/N]" key
fi  ##@@ 

if [ $key == "y" ]; then
	make menuconfig
fi
make install | tee -a ${LOGFILE}


echo "+----------------------------------------------------------------+"
echo "| Symbolic Links (Modules)                                       |" | tee -a ${LOGFILE}
echo "+----------------------------------------------------------------+"
echo " Press  to continue"
if  [ "$fast" != "T" ]; then
  read
fi  ##@@
##ln -s /lib/modules/$VER_KERNEL/ /lib/modules/`uname -r`/asterisk
depmod | tee -a ${LOGFILE}

echo "#################################################################"
echo "# Installation of files : FINISHED " | tee -a ${LOGFILE}
echo "### ---------------------------------------------------------- ##"
echo "#               Press  to continue                        "
echo "#################################################################"
if  [ "$fast" != "T" ]; then
  read
fi  ##@@


clear
echo "#################################################################"
echo "# Set Default Configurations," | tee -a ${LOGFILE}
echo "Prior .conf files are copied to .conf-orig  " | tee -a ${LOGFILE}
echo "### ---------------------------------------------------------- ##"
echo "#               Press  to continue                        "
echo "#################################################################"
if  [ "$fast" != "T" ]; then
  read
fi  ##@@


echo "+----------------------------------------------------------------+"
echo "| Changing the maximum upload, memory limit and magic_quotes_gpc |"
echo "| in PHP                                                         |"
echo "+----------------------------------------------------------------+"
echo " Press  to continue"
if  [ "$fast" != "T" ]; then
  read
fi  ##@@
sed -i-orig -e "s/\(upload_max_filesize *= *\)\(.*\)/\120M/" \
	-e "s/magic_quotes_gpc\ =\ On/magic_quotes_gpc\ =\ Off/" \
	-e "s/memory_limit\ =\ 16M/memory_limit\ =\ 100M/" \
	/etc/php5/apache2/php.ini | tee -a ${LOGFILE}
sed -i-orig -e "s/\(upload_max_filesize *= *\)\(.*\)/\120M/" \
	-e "s/magic_quotes_gpc\ =\ On/magic_quotes_gpc\ =\ Off/" \
	-e "s/memory_limit\ =\ 16M/memory_limit\ =\ 100M/" \
	/etc/php5/cli/php.ini | tee -a ${LOGFILE}

echo "+----------------------------------------------------------------+"
echo "| Music on hold (Symbolic link)                                  |" | tee -a ${LOGFILE}
echo "+----------------------------------------------------------------+"
echo " Press  to continue"
if  [ "$fast" != "T" ]; then
  read
fi  ##@@
ln -s /var/lib/asterisk/moh /var/lib/asterisk/mohmp3

echo "+----------------------------------------------------------------+"
echo "| Creating the user and setting permissions for user 'asterisk'  |" | tee -a ${LOGFILE}
echo "+----------------------------------------------------------------+"
echo " Press  to continue"
if  [ "$fast" != "T" ]; then
  read
fi  ##@@
adduser asterisk --disabled-password --gecos "asterisk PBX" --home /var/lib/asterisk 
adduser www-data asterisk


echo "+----------------------------------------------------------------+"
echo "| Changing the use www-data to asterisk for Apache2              |" | tee -a ${LOGFILE}
echo "+----------------------------------------------------------------+"
echo " Press  to continue"
if  [ "$fast" != "T" ]; then
  read
fi  ##@@
cp /etc/apache2/apache2.conf /etc/apache2/apache2.conf-orig

sed -i "s/\(^User *\)\(.*\)/\1asterisk/" /etc/apache2/apache2.conf
sed -i "s/\(^Group *\)\(.*\)/\1asterisk/" /etc/apache2/apache2.conf

echo "+----------------------------------------------------------------+"
echo "| Setup MySQL Tables and Users                                                          |" | tee -a ${LOGFILE}
echo "+----------------------------------------------------------------+"
echo " Press  to continue"
if  [ "$fast" != "T" ]; then
  read
fi  ##@@
echo "create database asteriskcdrdb;" | mysql -u root | tee -a ${LOGFILE}
echo "create database asterisk;" | mysql -u root | tee -a ${LOGFILE}
echo "GRANT ALL PRIVILEGES ON asteriskcdrdb.* TO asteriskuser@localhost IDENTIFIED BY 'amp109';" | mysql -u root | tee -a ${LOGFILE}
echo "GRANT ALL PRIVILEGES ON asterisk.* TO asteriskuser@localhost IDENTIFIED BY 'amp109';" | mysql -u root | tee -a ${LOGFILE}

mysql -u asteriskuser -pamp109 asteriskcdrdb < /usr/src/freepbx-${VER_FREEPBX}/SQL/cdr_mysql_table.sql 
mysql -u asteriskuser -pamp109 asterisk < /usr/src/freepbx-${VER_FREEPBX}/SQL/newinstall.sql 

echo "+----------------------------------------------------------------+"
echo "| Configuration of Asterisk to work with FreePBX                 |" | tee -a ${LOGFILE}
echo "+----------------------------------------------------------------+"
echo " Press  to continue"
if  [ "$fast" != "T" ]; then
  read
fi  ##@@
cp /etc/asterisk/asterisk.conf /etc/asterisk/asterisk.conf.orig
sed -i "s/\(astrundir *=> *\)\(.*\)/\1\/var\/run\/asterisk/" /etc/asterisk/asterisk.conf

mkdir /var/run/asterisk
chown -R asterisk:asterisk /var/run/asterisk

echo "+----------------------------------------------------------------+"
echo "| Running Asterisk post installation                             |"
echo "+----------------------------------------------------------------+"
echo " Press  to continue"
if  [ "$fast" != "T" ]; then
  read
fi  ##@@
/usr/sbin/asterisk | tee -a ${LOGFILE}

echo "+----------------------------------------------------------------+"
echo "| Modification of FreePBX configuration files                    |"| tee -a ${LOGFILE}
echo "+----------------------------------------------------------------+"
echo " Press  to continue"
if  [ "$fast" != "T" ]; then
  read
fi  ##@@
#$webroot        = "/var/www/html";
cp /usr/src/freepbx-${VER_FREEPBX}/install_amp /usr/src/freepbx-${VER_FREEPBX}/install_amp-orig
sed -i "s/\(^\$webroot*\)\(.*\)/\1 = \"\/var\/www\";/" /usr/src/freepbx-${VER_FREEPBX}/install_amp
chmod 755 /usr/src/freepbx-${VER_FREEPBX}/install_amp
echo "Assign eth0 IP to FreePBX" | tee -a ${LOGFILE}
LOCAL_IP=`/sbin/ifconfig eth0`
LOCAL_IP=`echo ${LOCAL_IP} | sed -e "s/\ Bcast:\(.*\)//"`
LOCAL_IP=`echo ${LOCAL_IP} | sed -e "s/\(.*\)\ inet addr://"`
sed -i "s/xx.xx.xx.xx/${LOCAL_IP}/g" "/usr/src/freepbx-${VER_FREEPBX}/install_amp"

chmod 755 /usr/src/freepbx-${VER_FREEPBX}/install_amp

echo "+----------------------------------------------------------------+"
echo "| Installing FreePBX                                             |"| tee -a ${LOGFILE}
echo "+----------------------------------------------------------------+"
echo "| Simply press  at each question.                         |"
echo "+----------------------------------------------------------------+"
echo " Press  to continue"
if  [ "$fast" != "T" ]; then
  read
fi  ##@@
cd /usr/src/freepbx-${VER_FREEPBX}/
./install_amp 

/usr/src/freepbx-${VER_FREEPBX}/apply_conf.sh | tee -a ${LOGFILE}

echo "+----------------------------------------------------------------+"
echo "| Stop Asterisk post installation                                |"| tee -a ${LOGFILE}
echo "+----------------------------------------------------------------+"
echo " Press  to continue"
if  [ "$fast" != "T" ]; then
  read
fi  ##@@
asteriskPID=$(cat /var/run/asterisk/asterisk.pid)
kill -9 $(cat /var/run/asterisk/asterisk.pid)


echo "+----------------------------------------------------------------+"
echo "| Remove Apache2 redirect                                        |"| tee -a ${LOGFILE}
echo "+----------------------------------------------------------------+"
echo " Press  to continue"
if  [ "$fast" != "T" ]; then
  read
fi  ##@@
sed -i "s/\(RedirectMatch*\)\(.*\)//" /etc/apache2/sites-enabled/000-default

echo "+----------------------------------------------------------------+"
echo "| Restart Apache2                                                |"| tee -a ${LOGFILE}
echo "+----------------------------------------------------------------+"
echo " Press  to continue"
if  [ "$fast" != "T" ]; then
  read
fi  ##@@
/etc/init.d/apache2 restart| tee -a ${LOGFILE}

echo "+----------------------------------------------------------------+"
echo "| Setting permissions                                            |"| tee -a ${LOGFILE}
echo "+----------------------------------------------------------------+"
echo " Press  to continue"
if  [ "$fast" != "T" ]; then
  read
fi  ##@@

chown -R asterisk:asterisk /etc/asterisk
chmod 770 /etc/asterisk/

chown -R asterisk:asterisk /var/lib/asterisk/
chmod 770 /var/lib/asterisk/

chown -R asterisk:asterisk /var/www/


echo "+----------------------------------------------------------------+"
echo "| Copying images                                                 |"
echo "+----------------------------------------------------------------+"
echo " Press  to continue"
if  [ "$fast" != "T" ]; then
  read
fi  ##@@
cp /var/www/admin/modules/dashboard/images/notify_* /var/www/admin/images/

echo "+----------------------------------------------------------------+"
echo "To run Asterisk+FreePBX: /etc/init.d/freepbx [start|stop|restart]"| tee -a ${LOGFILE}
echo "+----------------------------------------------------------------+"
echo " Press  to continue"
if  [ "$fast" != "T" ]; then
  read
fi  ##@@
STARTUP_SCRIPT="/etc/init.d/freepbx";
echo "Creating file ${STARTUP_SCRIPT} ...";

echo '#!/bin/bash' > ${STARTUP_SCRIPT}
echo '' >> ${STARTUP_SCRIPT}
echo 'AMPORTAL_BIN=/usr/local/sbin/amportal' >> ${STARTUP_SCRIPT}
echo '' >> ${STARTUP_SCRIPT}
echo 'if [ ! -x ${AMPORTAL_BIN} ]; then'  >> ${STARTUP_SCRIPT}
echo '        echo "error : amportal binary can not be found (${AMPORTAL_BIN})"' >> ${STARTUP_SCRIPT}
echo '        exit 0' >> ${STARTUP_SCRIPT}
echo 'fi' >> ${STARTUP_SCRIPT}
echo '' >> ${STARTUP_SCRIPT}
echo '' >> ${STARTUP_SCRIPT}
echo 'start() {' >> ${STARTUP_SCRIPT}
echo '	echo "Starting FreePBX ..."' >> ${STARTUP_SCRIPT}
echo '	${AMPORTAL_BIN} start'  >> ${STARTUP_SCRIPT}
echo '}' >> ${STARTUP_SCRIPT}
echo '' >> ${STARTUP_SCRIPT}
echo 'stop() {' >> ${STARTUP_SCRIPT}
echo '	echo "Stopping FreePBX ..."' >> ${STARTUP_SCRIPT}
echo '	${AMPORTAL_BIN} stop'  >> ${STARTUP_SCRIPT}
echo '}' >> ${STARTUP_SCRIPT}
echo '' >> ${STARTUP_SCRIPT}
echo 'case "$1" in' >> ${STARTUP_SCRIPT}
echo '  start)' >> ${STARTUP_SCRIPT}
echo '        start' >> ${STARTUP_SCRIPT}
echo '        ;;' >> ${STARTUP_SCRIPT}
echo '' >> ${STARTUP_SCRIPT}
echo '  stop)' >> ${STARTUP_SCRIPT}
echo '        stop' >> ${STARTUP_SCRIPT}
echo '        ;;' >> ${STARTUP_SCRIPT}
echo '' >> ${STARTUP_SCRIPT}
echo '  restart)' >> ${STARTUP_SCRIPT}
echo '	stop' >> ${STARTUP_SCRIPT}
echo '        start' >> ${STARTUP_SCRIPT}
echo '        ;;' >> ${STARTUP_SCRIPT}
echo '' >> ${STARTUP_SCRIPT}
echo '  *)' >> ${STARTUP_SCRIPT}
echo '        echo $"Usage: $0 {start|stop|restart}"' >> ${STARTUP_SCRIPT}
echo '        exit 1' >> ${STARTUP_SCRIPT}
echo 'esac' >> ${STARTUP_SCRIPT}
echo '' >> ${STARTUP_SCRIPT}
echo 'exit 0' >> ${STARTUP_SCRIPT}
chmod 755 ${STARTUP_SCRIPT}

echo "Setting ${STARTUP_SCRIPT} to be run at boot time..."
update-rc.d freepbx start 99 2 3 4 5 .
echo "Startup Script: ${STARTUP_SCRIPT}" | tee -a ${LOGFILE}
cat ${STARTUP_SCRIPT} | tee -a ${LOGFILE}

echo "#################################################################"
echo "#  Configuration : FINISHED "| tee -a ${LOGFILE}
echo "### ---------------------------------------------------------- ##"
echo "#               Press  to continue                        "
echo "#################################################################"
if  [ "$fast" != "T" ]; then
  read
fi  ##@@
}

function fr_passwords
{
clear
echo "#################################################################"
echo "# PART 3 - SETTING UP SECURITY                                   "| tee -a ${LOGFILE}
echo "### ---------------------------------------------------------- ##"
echo "#               Press  to continue                        "
echo "#################################################################"
  read

echo "+----------------------------------------------------------------+"
echo "| Change the default SQL password for the SQL user asteriskuser  |"| tee -a ${LOGFILE}
echo "| > Change AMPDBPASS=amp109 in /etc/amportal.conf                |"| tee -a ${LOGFILE}
echo "| > Change SQL PASSWORD                                          |"| tee -a ${LOGFILE}
echo "+----------------------------------------------------------------+"

read -p "NEW asteriskuser SQL password ? " key
echo $key| tee -a ${LOGFILE}
sed -i "s/\(^AMPDBPASS=*\)\(.*\)/\1$key/" /etc/amportal.conf
echo "SET PASSWORD FOR 'asteriskuser'@'localhost' = PASSWORD('$key');" | mysql -u root| tee -a ${LOGFILE}


echo "+----------------------------------------------------------------+"
echo "| Changing the default password for the Asterisk Manager         |"| tee -a ${LOGFILE}
echo "| > Change secret = amp111 in /etc/asterisk/manager.conf        |"| tee -a ${LOGFILE}
echo "| > Change AMPMGRPASS=amp111 in /etc/amportal.conf              |"| tee -a ${LOGFILE}
echo "+----------------------------------------------------------------+"
read -p "NEW Asterisk Manager password ? " key
echo $key| tee -a ${LOGFILE}

sed -i "s/\(^secret = *\)\(.*\)/\1$key/" /etc/asterisk/manager.conf
sed -i "s/\(^AMPMGRPASS=*\)\(.*\)/\1$key/" /etc/amportal.conf

echo "enabling DAHDI in amportal.conf..."| tee -a ${LOGFILE}
echo ZAP2DAHDICOMPAT=true >> /etc/amportal.conf
echo "End of Part 3, Security. _INSTALLATION COMPLETE_" | tee -a ${LOGFILE}
#EOF function fr_passwords
}

function fr_help
{
clear
echo "Installer for Asterisk + FreePBX on a Debian machine"
echo "Usage: dfreepbx [ -x --xpedite \| -s --setup \|  -f --fetch \| -i --install \| -p --passwords \| -h --help]"
echo "   Example:  dfreepbx -x -f -i -p"
echo "Xpedite: Fast mode, skips most 'Press Enter' prompts."
echo "Setup: (use 1x only) installs the build and development tools" 
echo "Fetch: Download and unpack fresh source files."
echo "Install: Build, Install and Configure source files."
echo "Passwords: Set the security and passwords."
echo ""
echo "Old .conf files are in .conf-orig. Run as root, the script "
echo "requires access to the Internet. NB: Do _NOT_ change any  "
echo "default passwords UNTIL Part 3: Setting Up Security (invoked"
echo "with -p). After using -p, set the default password "
echo "for the root mysql user. By default it is null. From MySQL, "
echo "invoke:  SET PASSWORD FOR 'root'@'localhost' = "
echo "PASSWORD('');  "
echo "Once installed, run asterisk+freepbx with: amportal start" 
echo ""
echo "Edit this script to set the following versions and filenames:"
echo "-> Asterisk = ${VER_ASTERISK},-> Dahdi = ${VER_DAHDI}"
echo "-> Libpri = ${VER_LIBPRI},-> Addons = ${VER_ADDONS}"
echo "-> FreePBX = ${VER_FREEPBX} (+ apache2 php5 mysql5)"
echo "-> Log File = ${LOGFILE}, Press  Enter  to continue  "
read
}
 
##########  MAIN   ###########


if ! [ -e `which ifconfig` ] 
then
  # echo $err_state  
  clear
  read -n 1 -p "You must run this script with root privilege (either user = root, or with sudo).  Hit CTRL-C now if you need to escalate your privilege level and restart" junk
  err_state="1"
fi
if  [ "$err_state" != "1" ]; then
 if ! [ $# -gt 0 ]; then
   fr_help
 else
 while [ "$1" != "" ]; do
    case $1 in
        -x | --xpedite )        fast="T"
                                ;;
        -s | --setup )    	fr_setup
                                ;;
        -f | --fetch )          fr_fetch
                                ;;
        -i | --install )        fr_install
                                ;;	
        -p | --passwords )    	fr_passwords
                                ;;	
        -h | --help )           fr_help
                                exit
				;;
        * )                     fast="F"; fr_help
                                exit 1
    esac
    shift
 done
 fi
fi 
exit 0

HOWTO Setup a Multi-User Graphic Desktop Server

Copyright 2005 W.S. Herrick 5/16/05

This document describes the steps to add remote desktops via VNC as a system service to Linux. The service can support remote users that you define and provide them a Linux GUI/desktop from the server. This service is available to any VNC client: Winx, Linux, or Mac. This dialogue is a little Mandrake bound, but many other distributions have similar methods.

The work-around presented here adds full-time pre-loaded X sessions launched by the server as a part of the vncserver service, not as an on-demand method. I tried to install the 'on-demand' Xvnc service using xinetd but couldn't make it respond to incoming session requests. I also tried using the Mandrake /etc/sysconfig/vncservers method, but could only get the last entry to run, so it effectively becomes a one-user service. The additional sessions require few resources beyond those needed by the regular X session, so the overhead for adding the static services is not very high. When many users begin to demand resources, the system response will slow.

The outcome of this effort is a server that will offer a desktop to a LAN/WAN VNC client. The server requires you to know the “display #” (eg: port#-5900) , the ip address of the server, and the password. You can forward and encrypt the session thru firewalls. Clients can get their same desktop from any workstation on the LAN or net. Several users may be able to share one machine without delays or conflicts-ymmv.

• Install the vncserver software-see your package manager and distrib for the right package-you can find packages by searching for VNC VNCSERVER TIGHTVNC REALVNC. AT&T wrote the original VNC and both Tight and Real VNC have added features. They all work. Pick the right package for your distribution, or compile the source code.

• NB: the display numbers set below must be unique, and may not be 0 (hint: use 1..n). Display 0 is usually taken by the graphic login manager, and then passed to the user running the server itself.

• NB: The display number+5900 corresponds to the port #.

• Display 0 is available to VNC if the user runs the vncserver (or rfb0server) once they've started their X session. The displays you are setting up here are going to run on a workstation, being served from the server box, and have display numbers larger than 0.

• Construct/Choose your users and set their vnc logins. For each user, add them. Set their password, and log in as that user. This creates their “/home/userid “ directory. Invoke vncserver. Offer it the same password as the user login. Kill the vncserver and logout. Do this for all users (you can add more later). You can set up an existing user, just invoke vncserver from the shell and procede as above. As an example, the following 9 users will be setup:

map 5951/display :1

map2 5952/display :2

map3 5953/display :3

johnc 5954/display :4

johnw 5955/display :5

derek 5956/display :6

wh 5957/display :7

tmp1 5958/display :8

tmp2 5959/display :9

• Use vncpasswd to change a password- or you can erase the “~/.vnc” dir and start vncserver.

• Create the file /etc/rc.d/init.d/vnczstart and write the following to it:

#!/bin/bash

su map -c "cd /home/map && [ -f .vnc/passwd ] && vncserver :1"

su map2 -c "cd /home/map2 && [ -f .vnc/passwd ] && vncserver :2"

su map3 -c "cd /home/map3 && [ -f .vnc/passwd ] && vncserver :3"

su johnc -c "cd /home/johnc && [ -f .vnc/passwd ] && vncserver :4"

su johnw -c "cd /home/johnw && [ -f .vnc/passwd ] && vncserver :5"

su wh2 -c "cd /home/wh2 && [ -f .vnc/passwd ] && vncserver :6"

su wh -c "cd /home/wh && [ -f .vnc/passwd ] && vncserver :7"

su tmp1 -c "cd /home/tmp1 && [ -f .vnc/passwd ] && vncserver :8"

su tmp2 -c "cd /home/tmp2 && [ -f .vnc/passwd ] && vncserver :9"

exit 0

• Create the file /etc/rc.d/init.d/vnczstop and write the following to it:

#!/bin/bash

su map -c "vncserver -kill :1 "

su map2 -c "vncserver -kill :2"

su map3 -c "vncserver -kill :3"

su johnc -c "vncserver -kill :4"

su johnw -c "vncserver -kill :5"

su wh2 -c "vncserver -kill :6 "

su wh -c "vncserver -kill :7"

su tmp1 -c "vncserver -kill :8"

su tmp2 -c "vncserver -kill :9"

exit 0

• Create/Edit the file /etc/rc.d/init.d/vncserver and write the following to it (NB: only two working lines are added- one to start the VNC server, and the other to stop-see the '# wsh' lines):

#!/bin/bash
#
# chkconfig: - 91 35
# description: Starts and stops vncserver. \
#	       used to provide remote X administration services.

# Source function library.
. /etc/init.d/functions

# Source networking configuration.
. /etc/sysconfig/network

# Check that networking is up.
[ ${NETWORKING} = "no" ] && exit 0

VNCSERVERS=""
[ -f /etc/sysconfig/vncservers ] && . /etc/sysconfig/vncservers


gprintf "VNCSERVERS %s: " "$VNCSERVERS"


prog=$"VNC server"

start() {
    gprintf "Starting %s: " "$prog"

#					 wsh 5/18/05
    /etc/rc.d/init.d/vnczstart 
# 					 wsh

    ulimit -S -c 0 >/dev/null 2>&1
    RETVAL=0
    for display in ${VNCSERVERS}
    do
        gprintf "%s " "${display}"
        initlog $INITLOG_ARGS -c \
            "su ${display##*:} -c \"cd ~${display##*:} && [ -f .vnc/passwd ] && vncserver :${display%%:*}\""
        RETVAL=$?
        [ "$RETVAL" -ne 0 ] && break
    done
    [ "$RETVAL" -eq 0 ] && success $"vncserver startup" || \
        failure "vncserver start"
    echo
    [ "$RETVAL" -eq 0 ] && touch /var/lock/subsys/vncserver
}

stop() {
    gprintf "Shutting down %s: " "$prog"

#  					wsh 5/18/05 
    /etc/rc.d/init.d/vnczstop
# 					wsh

    for display in ${VNCSERVERS}
    do
        gprintf "%s " "${display}"
	unset BASH_ENV ENV
        initlog $INITLOG_ARGS -c \
	    "su ${display##*:} -c \"vncserver -kill :${display%%:*} >/dev/null 2>&1\""
    done
    RETVAL=$?
    [ "$RETVAL" -eq 0 ] && success $"vncserver shutdown" || \
        failure "vncserver shutdown"
    echo
    [ "$RETVAL" -eq 0 ] && rm -f /var/lock/subsys/vncserver
}

# See how we were called.
case "$1" in
  start)
	start
	;;
  stop)
	stop
	;;
  restart|reload)
	stop
	start
	;;
  condrestart)
	if [ -f /var/lock/subsys/vncserver ]; then
	    stop
	    start
	fi
	;;
  status)
	status Xvnc
	;;
  *)
	gprintf "Usage: %s {start|stop|restart|condrestart|status}\n" "$0"
	exit 1
esac

• Start the vncserver service. U nder Mandrake, from a console, key in 'service vncserver start' and your desktops should be available. From a server console, invoke the vncviewer with 'vncviewer localhost:1' to test the first display/user. Test each by repeating the above with their individual display #. Set the runlevels (start at GUI/Net level) with 'chkconfig –level 345 on vncserver' or you can use the 'Configure My Computer' dialogs and start the service and set the runlevels.

• If you are running VNC over an untrusted net like the the internet, read the next couple of items, if you have a trusted LAN, skip to the User Login step below.

• NB: VNC is insecure. It broadcasts tcp packets on ports 5900..5999. Use ssh/putty to build secure encrypted tunnels for VNC if you expect to use it via the internet-or in any circumstance where the net is untrused. See VNC, ssh, and putty docs for more.

• The ports 5900..5999 correspond to display numbers. When you set the VNCSERVER #:ID above, the number you gave for the display maps to a port, where Display 0 maps to port 5900, Display 1 to 5901 and so on. Your firewall will need to allow and forward the 59xx ports. The allow is an Iptable rule, and the forwarding is usually done via “putty” or “ssh” when you set up the secure tunnel. You don't need to know this if you are not running VNC on an untrusted net, eg: the internet. On trusted LANs you need only know the display number, userid, and password.

• User Login with a VNC Client is pretty straightforward. Ones I use often are tightvnc and vncserver. They both expect a resolvable name or IP address of the server box, and the display number. You will be prompted for the password. In general, you must know the display number, userid, and password. Most viewers launch from a windows or linux GUI and the exact language will vary. Assign the display, and invoke the right password for the userID you are logging in as, and shazzam- you are running a desktop from the server. Other users can also be doing the same, on different display #'s and logins, on the same server.

• Don't “Logout of X” from the vnc session, just quit the session to exit. If you do logout, you'll have to kill and restart vncserver as that user with their display # on the server, afaict.

• In a nutshell, to make a secure connection: set up all firewalls (yours and theirs) to accept outbound VNC tcp & udp packets from 5900-59xx, where xx is the number of displays you want to serve, then launch ssh from your workstation from a shell run from your GUI, to their firewall in the form:

  “ ssh -l userid -C -L 5901:192.168.0.1:5901 66.65.64.63“, NB: this Requires you to have a login on their firewall. The 5901:192.168.0.1:5901 part sets up your local display number for the VNC served GUI (+5900), the local IP address of the GUI server, and the display number of the remote GUI (+5900). You'll give your vncviewer the Local display number, as shown next. The 66.65.64.63 part is the internet address of the remote firewall. See the ssh man page for more.

• Launch vncviwer from your workstation, from another shell run from your GUI, by invoking: “vncviewer -compresslevel 5 -quality 3 localhost:1” NB the “:1” is the Local display number that you set with the ssh command. See the vncviewer man page for details bout the compression and quality settings.

Stuff I learned but didn't need.

Install and configure the dm service: KDM, GDM, mdkkdm, etc. In Mandrake, use Configure My Computer to start the dm service (other distributions have their own service manager). Choose the Display Manager tab and select mdkkdm. This offers the GUI login and allows for remote X.

• Allow xinetd to listen to external calls. Edit /etc/xinetd.conf

  Comment Out:

  #only_from = localhost

• Mandrake specific, other OS's similar: edit /etc/kde/kdm/kdmrc & enable XDMCP on port 177, d isallow shutdown, reboot, and remote root logins:

  [Xdmcp]    	Enable=true    	Willing=/etc/X11/xdm/Xwilling    	Xaccess=/etc/X11/xdm/Xaccess    	Port=177

[X-*-Core]

  	AllowShutdown=None

 	AllowRootLogin=false

• Specify who has access to XDMCP

Edit /etc/X11/xdm/Xaccess and uncomment the line

'* #any host can get a login window

by removing the single quote '.

• Login as root and cd to /etc. Edit /etc/sysconfig/vncservers. Append a new line for each GUI instance you want to support-that is probably one for each userid. According to the KDE manual, adding new instances to a box already running KDE takes relatively few resources. Each line should be of the form: “VNCSERVERS #:ID” where # is the display # and ID is the userid. You need to know your display number when asking the server for the GUI login. You will need to know this if you have to pass thru a firewall, as well (see below). In our example, this file looks like:

VNCSERVERS="1:map"

VNCSERVERS="2:map2"

VNCSERVERS="3:map3"

VNCSERVERS="4:johnc"

VNCSERVERS="5:johnw"

VNCSERVERS="6:derek"

VNCSERVERS="7:wh"

VNCSERVERS="8:tmp1"

VNCSERVERS="9:tmp2"

• Restart the X server and xdm. Test from localhost:x. The following should show the map user's GUI/desktop:

pgrep xinetd <== shows PID

kill -s SIGHUP PID <== Use PID from above

pgrep dm

kill -s SIGHUP PID <== Use PID from above

vncviewer localhost:1

Comments on UST Contaminated Soil Landfarm Permit Request, Lee County, KY

My name is Will Herrick. I have resided in Lee County for more than 25 years. I wish to encourage the Commonwealth of Kentucky to deny the pending application # 065-00004 LP1NW1.

I have three reasons to challenge the landfarm permit:

• It is clear that the site design fails to meet the design goals,
• The Public, Lee County and the Commonwealth of Kentucky are at risk from fugitive contaminants escaping from this site, and
• I have a compelling personal experience, that being the protracted and painful death of my mother from aplastic anemia. This disease is well associated with exposure to Benzene (and other solvents), a common component of the blended fuels being brought into Lee County under this permit. I have a deep and abiding respect for the hazards of the contamination under review here.

The long-term risk to Lee County and to the state is genuine. At a minimum the permit needs to extend the bonding requirement to cover the continuing oversight, cleanup, and closure costs that come with siting the facility, else these costs will fall to the county and state taxpayers. Failing that, the hazardous compounds will enter the air and water unabated.

Without design improvements controlling the field source emmisions of hazardous airborne chemicals, of contaminated dust, and of chemical contact, the operating staff will be at risk for chronic exposure to known hazards that their managers have already declared to be of no concern to them (Facility Impact Report P3, Sections a, b, c & d: "There will be no increased risk of accidents associated with Soil Tech activities", "Measures have been taken to prevent any water run off from soils..." {tarps}, "No adverse effects are expected to land or water...gasoline quickly evaporates into the atmosphere", "We do not expect any adverse effects on human health" and "Generally one will be exposed to more fumes from filling an automobile" {Why are those signs posted at gas stations around the nation warning that fuel fumes are carcinogenic and to be avoided?}).

The applicants frequently cite the presence of other oil wells in the region. They imply the excuse that the area is already inundated with whatever has come from these other wells and cannot be impacted by yet another contamination source. This argument is false- blended gasoline has many compounds not found in crude petroleum, to wit: lead, MTBE, etc, and the constituents common to the two are found in entirely different concentrations. Lastly, two wrongs do not make a right. Adding new burdens to the most heavily contaminated yet important stretch of waterway in the Commonwealth, the Kentucky River, cannot be construed as meaningless or below regulatory concern.

The design needs repair to control hazardous airborne contaminants. The Division of Air Quality should require a permit application for the Volatile Organic Compound emissions. The design as submitted is actually a primitive 40,000 square foot (0.9 acre) air-stripper promoting evaporation and atmospheric transport over hydrocarbon metabolism (see Treatment Process Information, P1, Section 2: "Soils transported to the site will be remidated [sic] by aeration [sic]" and Application to Process Solid Waste, P1, paragraph B, section 4, "Soils are easily remediated with exposure to open air." and Facility Impact Report P3 Section 3, Subsections c & d: "Since gasoline quickly evaporates into the atmosphere" and "Gasoline contaminated soils are quickly remediated after they have been exposed to open air").

Hydrologic protections offered by the proposed design are simply absent. The only clear language on offer is not even part of the permit application, but a non-binding ancillary document, the "Fact Sheet" where it is stated that "in the event water must be removed, the company has a permitted disposal facility available to accept liquid from the containment cells". The Facility Impact Report, Section 2b, is entirely disengenuous: "Due to the fact that we are working only with solid waste, and this waste being placed in impermeable concrete cells, there will be no impact on any groundwater reserves in the area." Please refer to the prior citation, "Soils are easily remediated with exposure to open air"- the operators intend to expose these soils to wind and sun, while expecting that none of the evaporated compounds or airborne dust will ever leave the site and re-enter the hydrologic cycle? The proposed scheme for placing tarpaulins in the event of rain is a hoax (Facility Impact Report, P2, Section 3b: "If necessary cells can be covered with covered with [sic] tarping or plastic."). Without a 24-hour monitor, no-one will rise to the 3 am downpour, much less cover the entire 0.9 acre site before some runoff leaves the site and more floods the bottom of the containments cells. The subsequent anaerobic conditions will have a major impact on the microbial populations and their ability to oxidize hydrocarbons.

The only service this site offers is a benefit to the owners of the contaminated soil. According to the application, none of the principles have any experience operating such a facility.

There are adequate facilities in the Commonwealth that have better engineering, oversight, and bonding to provide the service being offered by the applicants. It is in everyone's interest to not lower is standards for contaminated soil remediation and invite the proliferation of undercapitalized, ill managed, understaffed facilities.

I have included below a very brief survey of the available literature to document my arguments. Neither inclusive nor detailed, these tip-of-the-iceberg citations give authoritative published support to my position:

• that the design submitted in the permit application is a recipe for air and water contamination;
• that a significant fraction of the contaminants ostensibly intended for bio-remediation by metabolic processes within bacteria will in fact escape untreated into the air and waters of the Commonwealth,
• that the air and water born effluents from this site are a public health risk; and
• that the operations staff are immersed in a field source of hazardous dust, vapor, and fluid.

The Permit by Rule historically given to landfarms by DNREP has been based on remediation of organic waste as a fertilizer amendment to deep healthy soils. The permit being sought here in fact seeks to evaporate significant fractions of the volatile contaminants, has no impact on soil fertility, and fails to show the required technical expertise to effectively manage bio-remediation. The husbanding of soil microbia is not trivial. The estimates and timeframes listed in the permit application demonstrate an optimistic ignorance of microbial growth kinetics, rates of remediation, and the likelyhood of metal toxicity impacting microbial populations.

---

The below are sample references on the hazards of blended fuels with an emphasis on Aplastic Anemias and Benzene. I have narrowed the focus for examples only- I could offer similar documentation on Lead, MTBE, Toluene and expect the Commonwealth to consider all known hazardous compounds found in the waste stream under permit.

• Report to the Occupational Disease Panel (Industrial Disease Standards Panel) on Occupational Exposure to Benzene and Leukaemia: Jennifer Penney,September 1995 [https://www.canoshweb.org/odp/html/rp7.htm]

Selected quotes on Benzene Exposures:

"Because of its anti-knock properties, benzene-containing substances are added to gasoline as a replacement for alkyl lead compounds. Gasoline contains from less than one to five percent

of benzene by volume." (International Agency for Research on Cancer. Benzene. IARC Monographs on the Evaluation of Carcinogenic Risk of Chemicals to Humans Vol. 29,Lyon France 1982)

IARC identifies the following major contributors to benzene emissions into air: (1) gasoline production, storage, transport, vending and combustion...(International Agency for Research on Cancer. Benzene. IARC Monographs on the Evaluation of Carcinogenic Risk of Chemicals to Humans Vol. 29, Lyon France 1982)

...

Because of the high volatility of benzene, inhalation is the most important route of exposure. Almost 50 percent of inhaled benzene is absorbed. (Landrigan and Nicholson, 1992) NIOSH estimates that

approximately 1% of benzene is absorbed from skin contact. However dermal absorption is enhanced and may approach 5% when skin is cracked, blistered or abraded as in rubber workers engaged in tire building. (Occupational Safety and Health Administration (OSHA). Final Rule on Occupational Exposure to Benzene. Fed Regist 1987;52:34460-34578)

...

Benzene is sometimes found in drinking water, primarily as a result of gasoline spills, or seepage from underground gasoline tanks. (Akland GG. Exposure of the general population to gasoline. Environ Health Persp Suppl 1993;101:27-32)

• National Emission Standards for Hazardous Air Pollutants: Off-Site Waste and Recovery Operations; Final Rule

[Federal Register: July 1, 1996 (Volume 61, Number 127)] [Rules and Regulations] [Page 34139-34200]

SUMMARY: This action promulgates National Emission Standards for Hazardous Air Pollutants (NESHAP) under the authority of Section 112 of the Clean Air Act for off-site waste and recovery operations that emit hazardous air pollutants (HAP). The NESHAP applies to specific types of facilities that are determined to be major sources of HAP emissions and receive certain wastes, used oil, and used solvents from off-site locations for storage, treatment, recovery, or disposal at the facility. The rule requires use of maximum achievable control technology (MACT) to reduce HAP emissions from tanks, surface impoundments, containers, oil-water separators, individual drain systems and other material conveyance systems, process vents, and equipment leaks.

...

From the section II. Basis and Purpose, subcategory A. Purpose of Regulation:

Following is a summary of the potential health and environmental effects associated with exposures, at some level, to the emitted pollutants that would be reduced by this NESHAP. The range of potential human health effects associated with exposure to organic HAP include cancer, aplastic anemia, pulmonary (lung) structural changes, dyspnea (difficulty in breathing), upper respiratory tract irritation with cough, conjunctivitis, and neurotoxic effects (e.g., visual blurring, tremors,delirium, unconsciousness, coma, convulsions).

• Environmental Health Perspectives, Volume 104, Supplement 6, December 1996

Clinical Features of Hematopoietic Malignancies and Related Disorders among Benzene-exposed Workers in China

Martha S. Linet,1 Song-Nian Yin,2 Lois B. Travis,1Chin-Yang Li,3 Zhi-Nan Zhang,4 De-Gao Li,4 Nathaniel Rothman,1 Gui-Lan Li,2 Wong-Ho Chow,1 Jennifer Donaldson,1 Mustafa

Dosemeci,1 Sholom Wacholder,1 William J. Blot,1 Richard B. Hayes,1 and The Benzene Study Group*

From the Discussion section of this article:

Fatal aplastic anemia was first reported among benzene-exposed workers nearly 100 years ago (72), while leukemia was initially linked with benzene exposure in 1928 (73)... Case-control studies have also linked benzene exposure (primarily occupational) with leukemia (10,78,79). These clinical series, case-control studies, and two important cohort investigations (18,19,80) were considered to provide sufficient evidence to link benzene with leukemia, particularly AML, in humans (2). Subsequent cohort investigations of benzene-exposed workers within chemical manufacturing, petroleum refinery, or other industries in the United States, the United Kingdom, Italy, and China have confirmed the benzene-leukemia association (Table 3) (81,82). Although acute myeloid leukemia, not otherwise characterized, has been the type of malignancy most consistently associated with benzene exposure, other unusual variants of acute myeloid leukemia, particularly erythroleukemia and to a lesser extent acute myelomonocytic leukemia, appear to occur disproportionately in some studies of benzene-related leukemia (15,83-85). While chronic myeloid leukemia has been mentioned in clinical reports (86,87), the only previous cohort investigation in which this

leukemia type was noted was the first cohort study by Yin et al. in China (6).

• Aplastic Anemia in a Petrochemical Factory Worker

Young Mann Baak, Byoung Yong Ahn, Hwang Shin Chang, Ji Hong Kim, Kyoung Ah Kim, and Young Lim. Environ Health Perspect 107:851-853 (1999). Department of Industrial Medicine, St. Mary's Hospital, The Catholic University of Korea, Seoul, Korea

Abstract

A petrochemical worker with aplastic anemia was referred to our hospital. He worked in a petroleum resin-producing factory and had been exposed to low-level benzene while packaging the powder resin and pouring lime into a deactivation tank. According to the yearly environmental survey of the working area, the airborne benzene level was approximately 0.28 ppm. Exposure to benzene, a common chemical used widely in industry, may progressively lead to pancytopenia, aplastic anemia, and leukemia. The hematotoxicity of benzene is related to the amount and duration of exposure. Most risk predictions for benzene exposures have been based on rubber workers who were exposed to high concentrations. In the petroleum industry, the concentration of benzene is relatively low, and there are disputes over the toxicity of low-level benzene because of a lack of evidence. In this paper we report the case of aplastic anemia induced by low-level benzene exposure.

---

EPA might tighten regulations on gas additive that fouls water

Published Friday, February 25, 2000, in the Lexington Herald-Leader

ASSOCIATED PRESS, LOUISVILLE

The Environmental Protection Agency might tighten controls over an additive that produces cleaner gasoline but is fouling water in many states, including Kentucky.

Four state legislators already have expressed their concern by pressing for a General Assembly resolution supporting an MTBE ban in Kentucky. The lawmakers acted as the EPA notified the federal Office of Management and Budget that it wants public comment on a proposal to regulate MTBE under the Toxic Substances Control Act. Tighter regulation could lead to phasing out the additive, which has been turning up in groundwater, lakes and rivers from California to Maine.

The resolution by state Sen. Dan Seum, R-Louisville, and his colleagues urges the state Natural Resources and Environmental Protection Cabinet to develop drinking-water standards for MTBE and to increase testing for the chemical. Kentucky environmental officials have found no current or imminent threat to water supplies.

---

BP OIL -- GASOLINE BP REGULAR UNLEADED (RFG W-MTBE)

MATERIAL SAFETY DATA SHEET

NSN: 9130013884080

Manufacturer's CAGE: 0NDT1

Part No. Indicator: A

Part Number/Trade Name: GASOLINE BP REGULAR UNLEADED (RFG W/MTBE)

===========================================================================

General Information

===========================================================================

Item Name: GASOLINE/BLENDED; MOTOR FUEL

Company's Name: BP OIL CO

Company's Street: 200 PUBLIC SQ

Company's City: CLEVELAND

Company's State: OH

Company's Country: US

Company's Zip Code: 44114-2375

Company's Emerg Ph #: 216-586-4219/800-321-8642

Company's Info Ph #: 216-586-4219/800-321-8642

Record No. For Safety Entry: 001

Tot Safety Entries This Stk#: 001

Status: SE

Date MSDS Prepared: 08JUN94

Safety Data Review Date: 01MAR96

Preparer's Company: BP OIL CO

Preparer's St Or P. O. Box: 200 PUBLIC SQ

Preparer's City: CLEVELAND

Preparer's State: OH

Preparer's Zip Code: 44114-2375

MSDS Serial Number: BYPGP

===========================================================================

Ingredients/Identity Information

===========================================================================

Proprietary: NO

Ingredient: METHYL TERT BUTYL ETHER (MTBE), 2-METHOXY-2-METHYL PROPANE,

T-BUTYLMETHYL ETHER *96-1*

Ingredient Sequence Number: 01

Percent: 15

NIOSH (RTECS) Number: KN5250000

CAS Number: 1634-04-4

-------------------------------------

Proprietary: NO

Ingredient: XYLENE, DIMETHYLBENZENE, XYLOL (IARC - GROUP 3) *95-4*

Ingredient Sequence Number: 02

Percent: 9

NIOSH (RTECS) Number: ZE2100000

CAS Number: 1330-20-7

OSHA PEL: 100 PPM

ACGIH TLV: 100 PPM, SKIN

Other Recommended Limit: 100 PPM

-------------------------------------

Proprietary: NO

Ingredient: TOLUENE (IARC CARC- GROUP 3) *95-4*

Ingredient Sequence Number: 03

Percent: 6

NIOSH (RTECS) Number: XS5250000

CAS Number: 108-88-3

OSHA PEL: 100 PPM

ACGIH TLV: 100 PPM

Other Recommended Limit: 375 MG/CUM

-------------------------------------

Proprietary: NO

Ingredient: 1,2,4-TRIMETHYLBENZENE *95-4*

Ingredient Sequence Number: 04

Percent: 3

NIOSH (RTECS) Number: DC3325000

CAS Number: 95-63-6

ACGIH TLV: 25 PPM

-------------------------------------

Proprietary: NO

Ingredient: BENZENE (SUSPECTED HUMAN CARC BY ACGIH, IARC, ANIMAL

CARCINOGEN BY IARC, CARCINOGEN BY NTP - IARC GROUP 1) *95-4*

Ingredient Sequence Number: 05

Percent: 2

NIOSH (RTECS) Number: CY1400000

CAS Number: 71-43-2

ACGIH TLV: 0.3 MG/CUM (A2) IC

Other Recommended Limit: 16 MG/CUM

-------------------------------------

Proprietary: NO

Ingredient: ETHYL BENZENE *95-4*

Ingredient Sequence Number: 06

Percent: 2

NIOSH (RTECS) Number: DA0700000

CAS Number: 100-41-4

OSHA PEL: 435 MG/CUM

ACGIH TLV: 434 MG/CUM

Other Recommended Limit: 100 PPM

-------------------------------------

Proprietary: NO

Ingredient: CYCLOHEXANE

Ingredient Sequence Number: 07

Percent: 1

NIOSH (RTECS) Number: GU6300000

CAS Number: 110-82-7

OSHA PEL: 1050 MG/CUM

ACGIH TLV: 1030 MG/CUM

Other Recommended Limit: 300 PPM

-------------------------------------

Proprietary: NO

Ingredient: GASOLINE

Ingredient Sequence Number: 08

Percent: 85-86

NIOSH (RTECS) Number: LX3300000

CAS Number: 8006-61-9

ACGIH TLV: 890 MG/CUM

Other Recommended Limit: 300 PPM

===========================================================================

Physical/Chemical Characteristics

===========================================================================

Appearance And Odor: CLEAR LIQUID W/A STRONG HYDROCARBON ODOR

Boiling Point: 80-440F

Vapor Pressure (MM Hg/70 F): 760

Vapor Density (Air=1): 1.2

Specific Gravity: 0.72-0.74

Evaporation Rate And Ref: (WATER = 1): >1

Solubility In Water: NEGLIGIBLE

Percent Volatiles By Volume: 100

===========================================================================

Fire and Explosion Hazard Data

===========================================================================

Flash Point: -35F

Flash Point Method: TCC

Lower Explosive Limit: 1.4

Upper Explosive Limit: 7.6

Extinguishing Media: DRY CHEMICAL, ALCOHOL FOAM, CLASS B EXTINGUISHERS,

CO2.

Special Fire Fighting Proc: WATER MAY BE INEFFECTIVE, USE TO COOL FIRE

EXPOSED CONTAINERS. FIREFIGHTERS MUST WEAR MSHA/NIOSH APPROVED POSITIVE

PRESSURE SCBA W/FULL FACE MASK/CLOTHING.

Unusual Fire And Expl Hazrds: VAPORS MAY FORM FLAMMABLE/EXPLOSIVE

MIXTURES

W/AIR. VAPOR/GAS MAY SPREAD TO DISTANT IGNITION SOURCES & FLASHBACK.

CONTAINERS MAY EXPLODE IN HEAT OF FIRE.

===========================================================================

Reactivity Data

===========================================================================

Stability: YES

Cond To Avoid (Stability): HEAT, SOURCES OF IGNITION

Materials To Avoid: STRONG OXIDIZERS & ALKALI METALS, STRONG

ACIDS/BASES.

Hazardous Decomp Products: CO, CO2, HYDROCARBONS

Hazardous Poly Occur: NO

===========================================================================

Health Hazard Data

===========================================================================

Route Of Entry - Inhalation: YES

Route Of Entry - Skin: NO

Route Of Entry - Ingestion: YES

Health Haz Acute And Chronic: INGESTION: HARMFUL/FATAL. ASPIRATION

HAZARD,

CAN ENTER LUNGS & CAUSE PNEUMONITIS/DAMAGE. IRRITATION, HARMFUL CNS

EFFECTS, RESPIRATORY ARREST, DEATH. INHALATION: RESPIRATORY TRACT

IRRITATION, CNS EFFECTS, IRREGULAR HEAT RHYTHMS. SKIN: IRRITATION,

BURNS.

EYES: IRRITATION, CONJUNCTIVITIS.

Carcinogenicity - NTP: YES

Carcinogenicity - IARC: YES

Carcinogenicity - OSHA: NO

Explanation Carcinogenicity: SEE INGREDIENTS.

Signs/Symptoms Of Overexp: IRRITATION, GI DISTURBANCES, NAUSEA,

VOMITING,

DIARRHEA, EXCITATION, EUPHORIA, HEADACHE, DIZZINESS, DROWSINESS, BLURRED

VISION, FATIGUE, TREMORS, CONVULSIONS, LOSS OF CONSCIOUSNESS, COMA,

DEFATTING, REDNESS, ITCHING, CRACKING OF SKIN, BURNS, SWOLLEN &

DISCOLORED

TISSUE, PAIN, LACRIMATION, INFLAMMATION.

Med Cond Aggravated By Exp: PRE-EXISTING EYE, SKIN & RESPIRATORY

DISORDERS.

Emergency/First Aid Proc: INGESTION: DON'T INDUCE VOMITING. ASPIRATION

HAZARD. SKIN: WASH W/SOAP & WATER. INJECTIONS NEED SERIOUS MEDICAL

ATTENTION. EYES: FLUSH W/WATER FOR 15 MINS. INHALATION: REMOVE TO FRESH

AIR. GIVE OXYGEN/CPR AS NEEDED. NOTE TO PHYSICIAN: ACUTE CHEMICAL

PNEUMONITIS CAN RAPIDLY PROGRESS TO RESPIRATORY FAILURE. FOR SKIN

INJECTION

CONSIDER DEBRIDEMENT TO MINIMIZE NECROSIS & TISSUE LOSS. (SEE SUPP)

===========================================================================

Precautions for Safe Handling and Use

===========================================================================

Steps If Matl Released/Spill: SHUT OFF IGNITION SOURCES. STOP LEAK

SAFELY.

WATER SPRAY MAY REDUCE VAPOR IN CLOSED SPACES. SMALL: TAKE UP

W/SAND/OTHER

NONCOMBUSTIBLE ABSORBENT MATERIAL & PLACE INTO CONTAINERS FOR LATER

DISPOSAL. LARGE: DIKE FAR AHEAD OF LIQUID FOR LATER DISPOSAL.

Waste Disposal Method: THE TRANSPORTATION, STORAGE, TREATMENT & DISPOSAL

OF THIS WASTE IAW/FEDERAL, STATE & LOCAL REGULATIONS. FLAMMABLE LIQUID

UN1203.

Precautions-Handling/Storing: STORE GASOLINE ONLY IN APPROVED, CLEARLY

LABELED CONTAINERS. NEVER STORE IN GLASS/UNAPPROVED PLASTIC CONTAINERS.

STORE IN TIGHTLY CLOSED CONTAINERS.

Other Precautions: STORE IN A COOL, DRY ISOLATED, WELL VENTILATED AREA

AWAY FROM HEAT. GROUND LINES & EQUIPMENT USED DURING TRANSFER TO REDUCE

STATIC SPARK, FIRE/EXPLOSION. KEEP OUT OF REACH OF CHILDREN. DON'T

SIPHON

PRODUCT BY MOUTH. (SEE SUPP)

===========================================================================

Control Measures

===========================================================================

Respiratory Protection: USE NIOSH APPROVED RESPIRATORY PROTECTION SHOULD

BE WORN. RESPIRATORY PROTECTION MAY BE NEEDED FOR NON-ROUTINE/EMERGENCY

SITUATIONS.

Ventilation: VENTILATION & OTHER FORMS OF CONTROLS ARE PREFERRED FOR

CONTROLLING CHEMICAL EXPOSURES.

Protective Gloves: IMPERVIOUS

Eye Protection: SAFETY GLASSES/CHEMICAL GOGGLES

Other Protective Equipment: PROTECTIVE CLOTHING.

Work Hygienic Practices: REMOVE/LAUNDER CONTAMINATED CLOTHING BEFORE

REUSE. WASH HANDS BEFORE EATING, DRINKING, SMOKING/USING TOILET

FACILITIES.

Suppl. Safety & Health Data: USE GOOD PERSONAL HYGIENE PRACTICES. SHOWER

AFTER WORK USING SOAP & WATER. FIRST AID: OBTAIN MEDICAL ATTENTION IN

ALL

CASES. PREC: DON'T USE FOR CLEANING, PRESSURE APPLIANCE FUEL. EMPTY

CONTAINERS MAY CONTAIN TOXIC, FLAMMABLE/COMBUSTIBLE/EXPLOSIVE RESIDUE/

VAPORS. DON'T CUT/GRIND/DRILL/WELD, REUSE/DISPOSE CONTAINERS.

===========================================================================

Transportation Data

===========================================================================

===========================================================================

Disposal Data

===========================================================================

===========================================================================

Label Data

===========================================================================

Label Required: YES

Label Status: G

Common Name: GASOLINE BP REGULAR UNLEADED (RFG W/MTBE)

Special Hazard Precautions: INGESTION: HARMFUL/FATAL. ASPIRATION HAZARD,

CAN ENTER LUNGS & CAUSE PNEUMONITIS/DAMAGE. IRRITATION, HARMFUL CNS

EFFECTS, RESPIRATORY ARREST, DEATH. INHALATION: RESPIRATORY TRACT

IRRITATION, CNS EFFECTS, IRREGULAR HEAT RHYTHMS. SKIN: IRRITATION,

BURNS.

EYES: IRRITATION, CONJUNCTIVITIS. IRRITATION, GI DISTURBANCES, NAUSEA,

VOMITING, DIARRHEA, EXCITATION, EUPHORIA, HEADACHE, DIZZINESS,

DROWSINESS,

BLURRED VISION, FATIGUE, TREMORS, CONVULSIONS, LOSS OF CONSCIOUSNESS,

COMA,

DEFATTING, REDNESS, ITCHING, CRACKING OF SKIN, BURNS, SWOLLEN &

DISCOLORED

TISSUE, PAIN, LACRIMATION, INFLAMMATION.

Label Name: BP OIL CO

Label Street: 200 PUBLIC SQ

Label City: CLEVELAND

Label State: OH

Label Zip Code: 44114-2375

Label Country: US

Label Emergency Number: 216-586-4219/800-321-8642




---

My Friend Walter   Posted: July 23, 2006
style="width: 203px; height: 288px;">

My friend Walter died in 2003. These are some pictures and written works friends have gathered to honor & recall him.

Click Here



---

Local Treasures   Posted: July 22, 2006
Elephant Leave Magnolia


Lignin, Lichen, and Light


Lucky




Young Mayapple




Mixed Mesophytics




On the North Fork of the Kentucky




Webs and Dew



---

WAIT & the Medwaste Incinerator   Posted: July 22, 2006
In 1990 (or so), The Wolfe County Fiscal Court voted to contract with and invite Waste Energy of Kentucky to place the world's largest medical waste incinerator in the western end of the county. They made that choice without any public dialog.

The county residents became outraged and organized to reverse the committed contract signed by the county government. By a stroke of fortune the Governor of Kentucky, Wallace Wilkinson, was due to attend a ribbon cutting ceremony at the county courthouse.

In a county of 7000 people, 2000 were there to meet the governor. The governor's helicopter made two passes over the crowd before he landed.

I will credit the late governor with being astute: I cornered him as he came out of the courthouse, in front of the 2000 county residents, and asked him to declare a ban on incinerator permits until the next legislature. With only a little repetitious prompting and pitchfork waving from the crowd, Governor Wilkinson agreed.

The county residents then flooded to governor's office with calls until he delivered the promised permit moratorium. He had to add phones lines and dedicate staff to manage all the calls. The county residents went on to lobby the legislature, and worked a bill into law that gave counties a local control option on such large scale incinerators.


The WAIT handouts, distributed to the folks waiting for the governor:




---







---

Photo Fun   Posted: July 21, 2006















































-










---

Mostly Monoliths   Posted: July 21, 2006





































































---

Critturs   Posted: July 21, 2006





























































---

Fungi   Posted: July 21, 2006





























































---

Assorted Docs on Child Services in Florida   Posted: January 1, 2006
This is a small library of information about Child Services in Florida. Click Here




---

HUD's Renewal Community Program (This is Not an official HUD site)   Posted: January 1, 2006
The RC and Round III Empowerment Zone initiatives represent a new approach to advancing economic prosperity in the Nation's poorest communities. Communities that receive RC or EZ designation will be able to use a revitalizing business tax incentive package valued at $22 billion nationwide. HUD has designated a total of 40 rural and urban RCs. The designated period will be from January 1, 2002 to December 31, 2009.

Information about HUD's Renewal Communities Program.
Categories include general information on Renewal Communities, Tax Advantages and Issues, the CoRA: Managing the RC program, Renaissence Communities and Renewal Communities on Main Street, and information specific to the Eastern Kentucky RC.

Click here to read about Renewal Communities.

---

Tax Advantages and Issues in Renewal Communities   Posted: January 1, 2006
Communities that receive RC or EZ designation will be able to use a revitalizing business tax incentive package valued at $22 billion nationwide. HUD will designate a total of 40 rural and urban RCs. The designation period will be from January 1, 2002 to December 31, 2009.
On December 21, 2000, the Community Renewal Tax Relief Act of 2000 was signed into law. The law provides for $15 billion in tax incentives under the New Markets Tax Credit Program to help spur economic growth in new markets in urban and rural communities across the country. By making an equity investment in an eligible 'community development entity' (CDE), individual and corporate investors can receive a New Markets Tax Credit worth more than 30 percent of the amount invested over the life of the credit, in present value terms.

Click here: https://www.appal.org/rc_tax/ to read more about RC tax advantages and issues.

---

HUD's CoRA-the Committee of Responsible Authority   Posted: January 1, 2006
The CoRA: Overseeing the Implementation of a Renewal Community

The governing board of a Renewal Community is known as the CoRA, an acronym for the Coordinating Responsible Authority. The design of a CoRA is left to the state government hosting the RC.

Click here https://www.appal.org/rc_cora/ to read the CORA pages.

---

The Eastern Kentucky Renewal Community: Breathitt, Owsley, Wolfe, & Lee Counties   Posted: January 1, 2006

Picture yourself standing on a forested ridge top overlooking a narrow valley in the foothills of the largest deciduous forest on earth. As you look across the valley to the next ridge, carved out from under the canopy of trees you can see ten acres of cleared land upon which tobacco is growing. A small farmhouse and trailer are visible and clothes hanging on a line are next to what appears to be a small kitchen garden. Glancing down into the valley a river that once was clear but now is occluded by deposits of silt resulting from the mining of coal and timber slowly winds its way toward town. Still blessed with an abundance of fish, which pregnant women are discouraged from eating and in which swimming is frequently forbidden, a small boat trolls the waters edge. The silence of the woods is punctuated by a flowing brook which spills over the rock cliff wall, an occasional animal scurrying about and the noise of an ATV as it makes its way along a path toward the two-lane blacktop road which passes through three of the four RC Community counties of Breathitt, Owsley, Wolfe and Lee. The BOWL is an area of breathtaking beauty and severe economic disadvantage as well. It is rural Appalachia.

Welcome.
These four southeast Kentucky counties have come together to participate in the federal government’s Renewal Community program. Over the course of the next eight years they will attempt to expand their combined economic base by capturing tax dollars and using them to revitalize their communities. This site will keep you abreast of their efforts.

Click here: https://www.appal.org/rc_bowl/ to read the BOWL RC pages.

---

Renaissence Communities, Main Street Programs and Renewal Communities   Posted: January 1, 2006
Articles first appearing in the "Three Forks Tradition" newspaper By: Larrey Riddle

Renaissance Kentucky
There is a lot to celebrate in small towns in Eastern Kentucky. Small towns are a comfortable place to live and work. Small towns are unarguably slower in pace. Small towns are often just plain more friendly than larger urban areas. Yet, decades of decline and neglect have left many small towns in Eastern Kentucky with empty storefronts and disrepaired infrastructure.

Click here: for more information on Rennaisense Kentucky and Beattyville Kentucky's Main Street Program

---

The Mill   Posted: January 1, 2003


Rebuilding the Sawmill


















































---

Unfinished Bylaws of the BOWL RC   Posted: May 30, 2002


BY-LAWS

OF THE

EASTERN KENTUCKY RENEWAL COMMUNITY

ARTICLE I

LEAD ENTITY

Section 1.1 The Coordinating Responsible Authority (CoRA) will serve as the lead entity for the EKRC.

Section 1.2 The Booneville/Owsley County Industrial Authority, a 501(c)3 non-profit organization, will serve as the administrative entity for the Eastern Kentucky Renewal Community (EKRC) and the official office of the EKRC will be located at the offices of the Owsley County Action Team in Booneville, Owsley County, Kentucky for the first six month or until the CoRA has an opportunity to become a 501 © 3.

ARTICLE II

RESPONSIBILITIES

Section 2.1: Purpose The primary purpose of the EKRC is to advance economic prosperity by encouraging job development and retention, assisting individuals to gain employment, succeed in their jobs, and become economically self-sufficient. Further, the EKRC will be engaged in scientific, literary, educational and charitable activities relating to the promotion, development, establishment, and expansion of industries, businesses, and employment in and for the people of the EKRC and to assist other organizations with efforts which are not in conflict with the EKRC Course of Action.

Section 2.2: Responsibility The Coordinating Responsible Authority (CoRA) shall have overall responsibility for making sure that the State and local commitments made at the time of the application are carried out. The CoRA will develop and administer policies, procedures, and activities to implement and maximize the Federal, State, and local benefits made available in the RC. The CoRA functions as the central point of contact for the RC.

Section 2.3: TIUP The CoRA will develop a Tax Incentive Utilization Plan (TIUP) to develop and expand businesses in the RC through available Federal, State, and local incentives. Further, the CoRA will ensure that the preliminary and final TIUPs are developed with the participation of RC residents and community organizations.

Section 2.4: Fund Raising The administrative entity will have the responsibility to secure administrative funds for CoRA activities, including the marketing of the tax incentives. Take out

Section 2.5: Modifications to Course of Action The CoRA alone will have the authority to submit requests to HUD to modify State and local commitments made at the time of the application and the TIUPs and will provide evidence that the proposed modifications are necessary or desirable.

Section 2.6: Reporting to HUD The CoRA and the State or local governments within the EKRC will submit periodic reports and provide additional information, such as TIUPs, as required by HUD.

ARTICLE III

LIMITATIONS

Section 3.1 No part of any funds received on behalf of the EKRC shall be for the benefit of, or be distributable to its directors, officers or other private persons, except that the CoRA shall be authorized and empowered to approve reasonable payments for services rendered.

Section 3.2 No part of the activities of the CoRA shall be the carrying on of propaganda or otherwise attempting to influence legislation and the CoRA shall not participate or intervene in (including the publishing or distribution of statements) any political campaign on behalf of any candidate for public office.

Section 3.3 In the event of dissolution of the CoRA, the CoRA shall, after paying or making provisions for payment of all of the liabilities of the CoRA, dispose of all assets of the EKRC exclusively for the purposes of the CoRA in such a manner, or to such organization or organizations organized and operated exclusively for charitable, educational, religious, or scientific purposes relating to economic development as shall at the time qualifying as an exempt organization or organizations under Section 501 (c) (3) of the Internal Revenue Code of 1954 (or the corresponding provision of any future U.S. Internal Revenue Law), as the CoRA shall determine.

ARTICLE IV

BOARD OF DIRECTORS

Section 4.1 The CoRA will manage the affairs of the EKRC and serve as the Board of Directors.

Section 4.2: CoRA

Section 4.2.1: Number There shall be a total of thirteen (13) individuals serving as a representative of the CoRA.

Section 4.2.2: Method of Selecting CoRA Three representatives will be appointed to serve on the CoRA from each county represented in the EKRC. These appointments will be made in the following manner: each city mayor appoints one person, each county judge executive appoints one person, and each city mayor and county judge executive will appoint one person together. The state will appoint one representative.

Section 4.2.3: Quorum In order to encourage participation by CoRA representatives, a quorum shall represent a minimum of two from each county for a total of 8 present the number of appointed CoRA representatives in attendance at any given meeting. A further look at this has caused some of us to think that a total of 8 and leave off the minimum of two from each county is a better solution. Otherwise, all members from three counties could be present and not have a quorum to conduct business.

Section 4.2.4: Term of appointed CoRA representatives on the CoRA CoRA representatives shall be appointed for staggered terms with one being replaced each year from each countyevery three years. CoRA appointees are eligible to serve successive terms on the CoRA.

Section 4.3: Annual Meetings The CoRA shall host an annual meeting to be held during the calendar year at such time and place as the CoRA designates in the notice of such meeting.

Section 4.4: Regular Meetings Regular meetings of the CoRA will occur monthly at such times and places as it shall designate from time to time. . OmitThe CoRA meetings will strictly follow the agenda and any other discussions brought up will be tabled until the end of the meeting. If time does not permit open discussion at the end of meeting, the issue will be placed on the agenda for the next meeting.

Section 4.5: Special Meetings A special meeting of the CoRA may be called any time by 2 CoRA members with 48 hour noticethe Chairman, Vice Chairman, or by any six (6) CoRA representatives. The persons calling the meeting shall in the notice thereof, state the time, date, place, and purpose of the meeting.

Section 4.6: Notice of Meetings Notice of regular meetings will be given to each CoRA representative at least one week prior to the meeting. Notice of special meetings of the CoRA are required to be given at least 72 hours prior thereto either by personal contact by the person calling the meeting with each CoRA representative, by mail to each CoRA representative, or by telephone facsimile transmission to each CoRA representative. The public shall be notified of all regular, special, and annual CoRA meetings seven days in advance.

Section 4.7: Proxy Voting At any CoRA meeting, designated CoRA representatives in attendance are allowed to vote. Proxy voting will not be allowed.

Section 4.8: Public Attendance at Meetings The public will be notified of each meeting of the CoRA through advertisement in each local county newspaper. The public will be allowed to attend meetings of the CoRA, however, they will sit apart from the CoRA, will not receive any handouts given to the CoRA during the meeting, will not enter into the discussions of the CoRA, and will be allowed to speak for two minutes each at the end of the meeting during the Open and Public Comments section of the agenda.

Section 4.9: Policies and Procedures The CoRA shall develop and maintain policies and procedures as needed. Such policies and procedures shall be approved by a majority vote of the CoRA and will take effect immediately upon acceptance. A policy may be changed by a vote of the majority of the CoRA.

Section 4.10: Vacancies The vacancy of a representative on the CoRA occurs (1) when a representative resigns, or (2) when a representative is removed from office.

Section 4.11: Resignation A CoRA representative may resign at any time by written notice delivered to the CoRA, its Chairman, or to the Vice Chairman or Secretary of the EKRC. A resignation is effective when the notice is delivered unless the notice specifies a future date. The pending vacancy may be filled before the effective date, but the successor shall not take office until the effective date.

Section 4.12: Removal One or more CoRA representatives may be removed, with or without cause, by the affirmative vote of two thirds of the CoRA representatives then in office present and voting at a meeting of the CoRA. No representative may be removed unless a written notice of such meeting, stating that the purpose of the meeting is to vote upon the removal of one or more representatives named in the notice, is delivered to all CoRA representatives then in office at least one week prior to the date of any such meeting.

The CoRA may declare vacant the office of a representative if he or she is declared of unsound mind by the order of a court or is convicted of a felony, has committed a serious violation of the conflict of interest policy, or if within sixty (60) days after notice of his or her selection, does not accept such office either in writing or by attending a meeting of the CoRA, and fulfill each other requirements as the by-laws may specify. If a CoRA representative misses three consecutive meetings without advance notice of good cause, the representative’s seat shall be declared vacant.

Section 4.13: CoRA Partners There shall be recruited a multitude of partners, both local, regional, state, and national, who are very important to the EKRC. All CoRA partners will be welcome to attend meetings participate in discussions, and support and contribute to the establishment and implementation of the EKRC. CoRA partners shall not have voting rights.

ARTICLE V

INDIVIDUAL COUNTY STEERING COMMITTEES

Section 5.1: County Steering Committees Individual County Steering Committees shall be established, each of which shall consist of not less than nineteen (19) members, one of whom shall be a representative on the CoRA. The County Steering Committees may not act on behalf of the CoRA or the EKRC or bind the CoRA to any action. The CoRA secretary shall be notified of the time, date, and place of each meeting of a County Steering Committee and any CoRA representative and any CoRA officers may attend and participate in any meeting.

Section 5.2: County Steering Committee Structure Each County Steering Committee will be broadly representative of the community. Each County CoRA representative will publically advertise the formation of the committee in their county and will get volunteers from at least nineteen individuals to serve from the following sectors: business, non-profit, school (faculty), county government, city government, public safety, youth high school, youth middle school, youth elementary school, healthcare, human services, elderly, agricultural, ministerial, adult education, recreation and tourism, arts, business development, low-income parents.

Section 5.3: Meetings County Steering Committees will meet at least quarterly to work on projects in their county related to the Course of Action.

ARTICLE VI

CoRA OFFICERS

Section 6.1: Officers The EKRC CoRA shall have the following officers: Chairman, Vice Chairman, Secretary, and Treasurer.

Section 6.2: Term The initial officers shall be elected by the CoRA. Thereafter, the officers shall be elected annually by the CoRA at their annual meeting. Vacancies may be filled at any meeting of the CoRA. No officer shall serve more than two consecutive terms. Each officer shall remain in office until his or her successor is elected and qualified, subject to earlier termination by removal or resignation.

Section 6.3: Chairman The Chairman shall be the principal officer of the CoRA and shall supervise all of the business and affairs of the EKRC. The Chairman shall preside at all meetings of the CoRA. He or she shall have all such powers as may reasonably be construed as belonging to the Chairman of the CoRA. The Chairman shall be diligent in ensuring that the meeting focuses on the agenda and the business at hand and shall ensure that discussions not pertaining to the agenda be tabled until the open comments section or included on the agenda of the next meeting.

Section 6.4: Vice Chairman The Vice Chairman shall perform the duties of the Chairman in the absence of the Chairman or in the event of the Chairman’s inability or refusal to act.

Section 6.5: Secretary The Secretary shall keep detailed minutes and records of the meetings of the CoRA and shall see that all notices are given in accordance with these by-laws or as provided by law, keep a list of all CoRA representatives and their mailing addresses. The Secretary shall collect, at each CoRA meeting, written individual county reports and will keep the benchmark reports up to date and will provide this information monthly to the Administrative Entity. The Secretary shall perform other duties incidental to the office of Secretary and such other duties as may be assigned by the Chairman or the CoRA representatives.

Section 6.6: Treasurer The Treasurer shall have the responsibility for working with the administrative entity and reporting on all financial matters relating to the CoRA.

Section 6.8: Removal Any officer or agent of the EKRC may be removed by an affirmative vote of not less than two-thirds of the CoRA representatives in attendance at any given meeting, provided that such removal be without prejudice to any contract rights of the person so removed. Appointment of an agent of the EKRC shall not create any contract rights, right to compensation, or reimbursement, unless otherwise provided by CoRA action.

ARTICLE VII

CONTRACTS, CHECKS, DEPOSITS, AND FUNDS

Section 7.1: Administrative Entity The Booneville/Owsley County Industrial Authority and its staff shall serve as the Administrative Entity of the EKRC and all funds received will be deposited in a new account specifically for the EKRC.

Section 7.2: Checks, Drafts, Etc. All checks, drafts, and other orders for payment of money, notes, or other evidences of indebtedness issued in the name of the EKRC shall be signed by such officer or officers, agent or agents of the EKRC and in such a manner as shall from time to time be determined by resolution of the CoRA. In the absence of such determination by the CoRA, such instruments shall be signed by the Treasurer and countersigned by the Administrative Entity of the CoRA.

Section 7.3: Designation of Depositories All funds of the EKRC shall be deposited from time to time to the credit of the EKRC in a bank account managed by the Booneville/Owsley County Industrial Authority and in a bank that is guaranteed by the Federal Deposit Insurance Corporation or other such guarantee programs of the federal government. All funds must be deposited in a bank within the EKRC.

Section 7.4: Gifts The CoRA may accept on behalf of the EKRC any contributions, gifts (or proceeds thereof), bequests or devises for the general purposes or for any special purpose of the EKRC. Acceptable gifts shall conform to the objectives and purposes of the EKRC and be accepted according to appropriate policy and legal requirements.

Section 7.5: Grants The CoRA shall seek and accept grants and gifts from public and private sources on a federal, state, and local level which will finance programs in furtherance of the goals and purposes of the CoRA.

Section 7.6: Financial Assistance to Others The CoRA will seek funds to administer the programs and responsibilities outlined in the Course of Action that will be regionally effective. Individual counties will have the responsibility of seeking funds to implement programs within their own counties. The CoRA will not serve as a conduit of funds outside of CoRA responsibilities.

ARTICLE VIII

CONFLICT OF INTEREST

Section 8.1: Statement of General Policy The CoRA recognizes that both real and apparent conflict of interest or dualities of interest (hereinafter referred to as “conflicts”) may unintentionally occur in the course of conducting the EKRC’s daily affairs. A conflict as used in these by-laws refers only to personal, proprietary interests of the persons covered by this policy and their immediate families and not philosophical or professional differences of opinion. Conflicts occur because the many persons associated with the EKRC should be expected to have, and do in fact generally have multiple interests and affiliations and various positions of responsibility within the community. Sometimes a person will owe identical duties to two (2) or more organizations conducting similar activities.

Conflicts are undesirable because they potentially or apparently place the interest of others ahead of the EKRC’s obligations to its purposes and to the public interest. Conflicts are also undesirable because they often reflect adversely upon the persons involved and upon the institutions with which they are affiliated, regardless of the actual facts or motivations of the parties. The long range best interests of the EKRC, however, do not require the termination of all association with persons who may have real or apparent conflicts if a prescribed and effective method can render such conflicts harmless to all concerned. Therefore, the EKRC’s affirmative policy shall be to require that all actual or apparent conflicts be disclosed promptly, publicly, and fully to the CoRA and to prohibit specified involvement in the affairs of the EKRC by persons having such conflicts. Failure to disclose may result in removal from the Board.

Section 8.2: Coverage This coverage shall apply to all representatives of the CoRA and all officers or agents of the EKRC, including independent contractors providing services or materials. The EKRC’s Administrative Entity shall have the affirmative obligation to publicize periodically this policy to all such parties.

Section 8.3: Disclosure of All Conflicts All persons to whom this policy applies shall disclose all real and apparent conflicts, which they discover or have brought to their attention in connection with the EKRC activities. “Disclosure” as used in these by-laws shall mean providing promptly to the appropriate person a description of the facts comprising the real and apparent conflict.

Section 8.4: Proscribed Activity by Persons Having Conflicts When an individual CoRA representative, officer or agent believes that he/she or a member of his/her immediate family might have or does have a real or apparent conflict, he/she must, in addition to disclosing same, abstain from making motions, voting, executing agreements, or taking any other similar direct action on behalf of the EKRC where the conflict might pertain, but shall not be precluded from debate or other similar involvement on behalf of the EKRC. When any person requests in writing, or upon its own initiative, the CoRA at any time may establish further guidelines consistent with the interests of the EKRC for the resolution of any real or apparent conflict.




---

KRADD Historic Trends and Geographic Patterns: UKAC   Posted: May 27, 2002

Kentucky River Area Development District



Historic Trends and Geographic Patterns





By Timothy Collins, Ronald D Eller, and Glen Edward Taul
Maps by Eugene McCann and Stephen Hanna
With assistance from Sarah Dewees, Theresa Rajack, and Boyd Shearer

This study was developed by the University of Kentucky Appalachian Center under a contract with the Kentucky River Area Development District, with major funding from the Ford Foundation.

TABLE OF CONTENTS
# PART I
# KRADD: A Distinct Region Within The Cumberland Plateau 1
# Introduction 1
# Early Development Patterns 1
# Industrialization, 1861-1920 4
# The Great Depression and Beyond 6
# PART II
# INTRODUCTION 11
# DEMOGRAPHICS 11
# POPULATION CHANGES 11
# POPULATION BY AGE GROUP 12
# GEOGRAPHY OF POPULATION DISTRIBUTION 15
# EMPLOYMENT 16
# BUSINESS ESTABLISHMENTS 17
# TOTAL EMPLOYMENT 18
# MINING EMPLOYMENT 19
# MANUFACTURING EMPLOYMENT 20
# GOVERNMENT EMPLOYMENT 20
# SERVICE JOBS 21
# LABOR FORCE CHARACTERISTICS 22
# UNEMPLOYMENT RATES 22
# LABOR FORCE PARTICIPATION 23
# WORK FORCE COMMUTING PATTERNS 23
# WAGES AND INCOME 24
# AVERAGE EARNINGS FOR JOBS 24
# AVERAGE PLACEMENT WAGES 25
# PER-CAPITA INCOME 25
# PER-CAPITA TRANSFER PAYMENTS 26
# TOTAL PERSONAL INCOME 27
# PERSONS WITHOUT WAGES 28
# PERSONS WITH SELF INCOME 29
# POVERTY 30
# POVERTY RATES 30
# CHILDREN UNDER 18 IN POVERTY 31
# PERSONS RECEIVING PUBLIC ASSISTANCE 33
# EDUCATION 34
# HIGH-SCHOOL GRADUATES 34
# ASSOCIATE DEGREES 35
# OVERALL RANKING AND CONCLUSIONS 36
# GROWTH CENTER DEVELOPMENT 36
# DEMOGRAPHICS 36
# EMPLOYMENT 36
# LABOR FORCE CHARACTERISTICS 36
# WAGES AND INCOME 38
# POVERTY 38
# EDUCATION 38
# PART III
# SELECTED COMMUNITY ORGANIZATIONS SERVING KRADD 39  





---

2000 Census Reports for the BOWL RC   Posted: May 25, 2002
US Census Bureau 2000: Table of County Population & Business Statistics



These tables present basic population counts, education levels, and business facts for Breathitt, Owsley, Wolfe and Lee Couties.


People and Business QuickFacts Wolfe County, Kentucky

• Private nonfarm establishments, 1999 75
• Private nonfarm employment definition and source info Private nonfarm employment, 1999 623
• Children below poverty, percent, 1997 model-based estimate 46.4%

---

People and Business QuickFacts Lee County, Kentucky
• College graduates, persons 25 years and over, 1990 268
• Private nonfarm establishments, 1999 111
• Private nonfarm employment, 1999 1,906
• Children below poverty, percent, 1997 model-based estimate 47.0%

---

People and Business QuickFacts Breathitt County, Kentucky
• College graduates, persons 25 years and over, 1990 809
• Private nonfarm establishments, 1999 236
• Private nonfarm employment, 1999 2,322
• Children below poverty, percent, 1997 model-based estimate 44.9%

---

People and Business QuickFacts Owsley County, Kentucky
• College graduates, persons 25 years and over, 1990 312
• Private nonfarm establishments, 1999 44
• Private nonfarm employment, 1999 269
• Children below poverty, percent, 1997 model-based estimate 50.0%

  
  

  ---

  Linda Schakel's RC Tax Incentives Seminar: May 14th, 2002   Posted: May 16, 2002
  

  RC Tax Incentives Seminar: May 14th, 2002

  This is most of a two hour seminar on RC tax incentives. The speaker is Linda Schakel, a leading authority on RC taxation. The seminar was directed to accountants and business people, but was attended by a broad range of residents from the Eastern Kentucky (BOWL) RC. It was sponsored by the University of Kentucky Cooperative Extension Service (with many partners).

  Download Part 1 first (about 5 minutes on a modem line), and then pull down the rest while you listen. Click on the "Part #" to download. Part 1, Part 2, Part 3, Part 4, Part 5, Part 6, Part 7

  ---

  The meeting sound files are low fidelity MP3's.

  The files are sized to download quickly and to fit on a floppy diskette. You can bring down the first file in less than 5 minutes. While listening to the first part of the meeting, you can download the remaining files.

  Use any MP3 player to listen to the meeting files. Common players are the Windows (c) Media Player, FreeAmp, Xmms, and any of the standalone players like the Rio.

  Please forgive the sound quality, and the occaisional pops, warbles and dropouts-MP3's are a "lossey" compression technology and many compromises are made to make the files this small.
  

  ---

  Copyrighted Material   Posted: May 16, 2002
  This site contains copyrighted material the use of which has not always been specifically authorized by the copyright owner. We are making such material available in our efforts to advance understanding of environmental, political, human rights, economic, democracy, scientific, and social justice issues, etc. We believe this constitutes a 'fair use' of any such copyrighted material as provided for in section 107 of the US Copyright Law. In accordance with Title 17 U.S.C. Section 107, the material on this site is distributed without profit to those who have expressed a prior interest in receiving the included information for research and educational purposes. For more information go to: www4.law.cornell.edu If you wish to use copyrighted material from this site for purposes of your own that go beyond 'fair use', you must obtain permission from the copyright owner
  

  ---

  BOWL Renewal Community Application Narrative   Posted: May 15, 2002
  NB: You may download this document in
  RTF,
  DOC, or
  PDF formats.

  
  
  
  

  
  

  BREATHITT, LEE, OWSLEY, AND WOLFE COUNTIES

  
  
  
  
  

  RENEWAL COMMUNITIES APPLICATION

  
  
  
  

  TABLE OF CONTENTS

  
  
  

  SECTION

  
  1. Notice of Intent to Apply
  
  2. Identification of Nominated Area
  
  3. Certification to Economic Condition Requirements
  
  4. Course of Action
  
  
  
  • Signed Cooperative
    Commitment
  
  
  • Goals and Actions
  
  
  • Recognition of Past
    Efforts
  
  
  • Timeline
  
  
  • Performance
    Measures and Evaluation
  
  
  
  
  5. Local Crime Index Certification
  
  6. Certification of Economic Growth Promotional Requirements
  
  7. Public Notice Certification
  
  8. Attachments:
  
  
  
  • Attachment 1: Kentucky Title IV-A State TANF Plan
  
  
  • Attachment 2: Jefferson Hotel Skills Center
  
  
  • Attachment 3: Fund for Excellence
  
  
  • Attachment 4: Regional Childcare Service Agents
  
  
  • Attachment 5: Pine Ridge Regional Industrial Park
  
  
  • Attachment 6: Panbown Lake Industrial Park
  
  
  • Attachment 7: Lee County Industrial Park
  
  
  • Attachment 8: Lone Oak Industrial Park
  
  
  • Attachment 9: East Central Kentucky Workforce Report
  
  
  • Attachment 10: Owsley County KREDA Proposal to Governor Paul
    Patton
  
  
  • Attachment 11: Kentucky Business Incentives.
  
  
  • Attachment 12: Local County LGEDF Spreadsheets.
  
  
  • Attachment 13: Renewal Communities Project Surveys
  
  
  • Attachment 14: Champion Communities Benchmark System Report.
  
  
  
  
  
  

  COURSE OF ACTION

  
  
  

  COOPERATIVE COMMITMENT TO THE RENEWAL COMMUNITIES COURSE OF ACTION

  
  
  

   PARTNERSHIPS AND AGREEMENTS

  
  Located in the beautiful mountains of eastern Kentucky, and in the heart
  of Appalachia, Breathitt, Lee, Owsley, and Wolfe Counties, important
  regional organizations, as well as the Commonwealth of Kentucky have
  been working hard to improve the economic condition of our distressed,
  isolated communities. We are working to prepare our area for growth despite
  the difficult obstacles we face as a result of the geographic isolation,
  generational poverty, dependence on assistance, low educational levels
  that have caused a lack of motivation in our people, a poor transportation
  system, and, most importantly, a lack of jobs.
  
  
  
  However grim the circumstances may seem statistically, our communities
  are blessed with a population of good people who do the best they can
  to enjoy life with limited resources. For the most part, our people
  are happy with their quality of life and find the slow pace of community
  life peaceful and enjoyable. They have gotten used to having time to visit
  and talk with their neighbors. When bad things happen, our people are
  there to provide support and help where they can. On the other hand,
  our people want to work. In fact, many people want to have a job so badly
  that they drive long distances to get to work.
  
  
  
   Most importantly, our people have learned from their mistakes. Individuals
  with little income manage their money better than most. And they
  know more about what kind of community they need than most. Individuals
  in our communities have committed to growth. Not only community growth,
  but personal growth as well. They want an opportunity to learn and work.
  They take pride in providing for their families. Our people are proud
  of their mountain heritage and, due to years of struggle, have gained
  a variety of experiences and skills that qualify them to assure the success
  of a Renewal Community designation.
  
  
  
  This area, from the beginning of this process, made a sincere commitment
  to form a cooperative partnership in order to bring our communities
  into the 21st Century. When asked, Where are you from?, one person
  who moved to Owsley County within the last three years fondly replies,
  Im from the 1950's. The small town way of life, like years ago, means
  a lot to people. Everyone knows most everyone, and if anything happens,
  everyone knows. Children are raised with less of a focus on material
  lifestyles and more on the quality of lifestyle. Families are important.
  They stick together in the toughest of circumstances. Although the small
  town way of life is important, our people welcome job opportunities
  and look forward to taking care of themselves. Many realize that with
  the loss of agriculture income from tobacco farming, their livelihood
  depends on available jobs.
  
  
  
  Recognizing the benefits of the Renewal Communities designation, there
  are a great number of individuals waiting on an opportunity to be involved.
  Individual community members are excited about the possibility of
  locally available jobs. The leaders of these counties have proven their
  involvement and commitment by their work during this process and in
  the past. This group is committed to the implementation of the benefits
  of this designation and have committed to participate in the program
  throughout the entire designation.
  
  
  
  The partners described below, whose commitment is evidenced by their signature,
  have a history of partnership and programs in the designated area. Some
  of them have experience in working with currently designated Empowerment
  Zones, Enterprise Communities, and Champion Communities. (Both Breathitt
  and Owsley Counties are recognized Champion Communities.)
  
  
  
  It is the desire of these partners that the public have input into every
  aspect of this designation and its implementation. We have committed
  to settle for nothing less. Every person counts and their input is
  considered valuable. Not only does this give the public the assurance that
  they are going to be included in the process, it also shows a deep respect
  for individual people, not just the community.
  
  
  
  During the past few years, we have been involved in a broad range of activities
  that not only help to prepare our communities to attract business and
  create jobs, but also to create an atmosphere where individuals can
  gain self confidence and become self-sufficient, hard working people who
  are able to care for themselves. These activities could not have been
  accomplished had it not been for the active involvement and support
  of numerous local, regional, state, and national partners who have
  not only encouraged our participation, but also has supported our participation
  through personal involvement.
  
  
  
  The following list briefly describes the main partners in the Breathitt,
  Lee, Owsley, and Wolfe Counties Renewal Communities initiative.
  
  
  
  
  
  

  The Commonwealth of Kentucky
  (https://www.state.ky.us)

  
  The Commonwealth of Kentucky is dedicated to improving the quality of life
  and the standard of living for all of its citizens. In the last five
  years, Kentucky has made tremendous progress in a number of areas. We
  have diversified the economy, invested in transportation and communications
  infrastructure, improved healthcare delivery, extended education reform,
  and increased the number of visitors to our state through aggressive
  tourism programs.
  
  
  
   Recognizing that Appalachian Kentucky is not advancing at the same
  rate as the rest of the Commonwealth, the Governor has made a commitment
  to assist our area of the state to become more economically sound.
  Through the Cabinet for Economic Development, the Cabinet for Families
  and Children, the Workforce Development Cabinet, the Transportation Cabinet,
  the Cabinet for Health Services, and other divisions, Kentucky provides
  our communities with staff and resources to assist us in becoming
  more self-sustaining. Kentucky does not only encourage economic growth,
  but personal growth as well.
  
  
  
  
  

  Kentucky Cabinet for Economic Development (https://www.edc.state.ky.us)
  

  
  The Kentucky Cabinet for Economic Development is responsible for creating
  new jobs and new investment in the state. Programs administered by
  the Cabinet are designed to support and promote economic development
  within the state primarily through attracting new industries to the state,
  assisting in the development of existing industries, and assisting communities
  in preparing for economic development opportunities.
  
  
  
  The Cabinet consists of the Office of the Secretary, the Office of the
  Commissioner for the New Economy, the Department for Coal County Development,
  the Department for Business Development, the Department of Financial
  Incentives, the Department of Community Development, and the Department
  of Administration and Support.
  
  
  
  Through the regional office in Prestonsburg, the Cabinet for Economic Development
  is familiar with area businesses, communities, and local leaders in economic
  development. Their specialists offer assistance to Kentucky businesses
  through existing and expanding business programs and site and infrastructure
  development programs, including access to technical advice for communities
  utilizing their single and multi-county coal severance funds. They also
  work with local communities by assisting with the marketing of county
  and regional industrial parks and speculative buildings.
  
  
  
  Kentucky offers some of the most innovative tax incentives and business
  development programs in the nation to new and existing businesses.
  These programs are designed to help existing businesses in the state
  grow and prosper and encourage new firms to join Kentuckys business population.
  Low business costs, a wide range of tax and financial incentives, and
  licensing and marketing assistance programs are just a few of the innovative
  programs available to encourage business investments and expansion
  in Kentucky.
  
  
  
  
  

  Kentucky Cabinet for Families and Children (https://cfc.state.ky.us)
  

  
  The Cabinet for Families and Children provides human services for the citizens
  of Kentucky. The Cabinets services include protection for vulnerable
  children and adults, child abuse investigations, foster care, adoptions,
  child support collections, cash assistance, food stamps, disability
  determinations, and more.
  
  
  
  The Kentucky Transitional Assistance Program (K-TAP) is administered through
  the Cabinet for Families and Children and provides financial and medical
  assistance to needy dependent children in Kentucky and the parents,
  or relatives, with whom the children are living. This program offers
  temporary cash assistance to families in order to assist families in finding
  jobs or getting training that leads to a job.
  
  
  
  The K-TAP mission is to provide families with the tools to become self-sufficient
  while ensuring children are protected and valued. Their goals are to
  move their clients into full-time, unsubsidized employment, help their
  clients retain jobs and, when necessary, obtain re-employment, assist
  families to become self-sufficient, involving clients in work activities
  in order for them to become self-sufficient before their five year
  limit expires, and to ensure that children live in a safe, secure environment.
  
  
  
  
  Their approach is to develop partnerships with other state agencies, local
  governments, community based organizations and employers to provide linkages
  for Kentucky Works participants for services to reduce barriers to
  employment, to integrate services, to develop multiple strategies recognizing
  the varying strengths and needs of clients and communities, to encourage
  communities to develop broad based collaborations for local plans for
  welfare reform and regionalized economic development strategies, and
  to maximize all state and local resources. They also provide information
  and support to participants enabling them to recognize their own strengths,
  value work, formulate goals, choose options, and meet new expectations.
  They integrate the new mission into service delivery through training
  for case managers and communication with service providers.
  
  
  
  The Kentucky Cabinet for Families and Children (CFC) is responsible for
  the TANF block grant. TANF is administered by the Department for Community
  Based Services (DCBS) within the CFC. DCBS offices are located in every
  county. Case managers work in partnership with families to support
  their efforts toward self-sufficiency. Coordinators serve as program consultants
  in Kentucky Works policy and act as facilitators/resource persons with
  other agencies.
  
  
  
  
  

   The East Kentucky Corporation (https://www.eastkentucky.com)
  

  
  The East Kentucky Corporation, created in 1990, is dedicated to increasing
  sustainable employment opportunities within eastern Kentucky by marketing
  the region as a good place to live and locate a business, increasing
  attention to knowledge-based industries and workers, partnering with
  other organizations with similar goals, helping existing businesses,
  and promoting an entrepreneurial climate.
  
  
  
  The East Kentucky Corporation owns and operates a small revolving loan
  fund for assisting in financing eligible entrepreneurial businesses
  at both their start-up state and their first expansion stage. In as
  much as possible, the East Kentucky Corporation seeks to partner with local
  commercial lenders, as well as other non-profit and public agency small
  business lenders.
  
  
  
  
  

  Kentucky River Area Development District

  
  The Kentucky River Area Development District is a quasi governmental agency
  working with city and county governments in the KRADD area to improve
  the quality of life for our citizens. KRADD was officially organized
  on May 13, 1968, the third of the fifteen Area Development Districts
  formed in Kentucky as non-profit planning and development organizations.
  KRADD serves as a representative of local units of government and
  citizens throughout the area and as a communication network for cities,
  counties, states, and federal governments. KRADD also serves as a center
  for information and data pertaining to the Kentucky River Area. KRADD
  has helped to provide a forum where Mayors, County Judge Executives,
  legislators, and citizen lenders can discuss problems and projects
  of mutual concern in order to improve the quality of life in our mountain
  region.
  
  
  
  KRADD serves all of the counties located within the designated zone through
  physical resources including economic development, a revolving loan fund,
  mapping and Geographic Information System services, public administration,
  transportation planning, community resource planning and coordination
  of the state PRIDE program, and human resources such as nutrition planning,
  support services, the Senior Community Service Employment Program, home
  care, long-term care ombudsman program, family caregivers program, community
  collaboration for children, and rental assistance.
  
  
  
  
  

  Middle Kentucky Area Development Council

  
  The Middle Kentucky River Area Development Council integrates their services
  with existing services within the community to provide a holistic approach
  to services that strengthen families, address barriers to success,
  and support economic growth in Breathitt, Lee, Owsley, and Wolfe Counties.
  Beyond providing services to individuals, Middle Kentucky is dedicated
  to the improvement of business, the availability of jobs, improved local
  community government, and local services, working with these agencies
  both as customers and collaboration partners in these endeavors.
  
  
  
  
  Middle Kentucky programs include Workforce Investment Act programs aimed
  at providing assistance with locating employment and training; Head
  Start, serving children between the ages of 3 and 5 years old; LIHEAP,
  a federally funded program that offers energy assistance to low-income
  individuals and families through subsidy and crisis; TOPS Job Club,
  a welfare-to-work initiative operated by the Eastern Kentucky Concentrated
  Employment Service on site at Middle Kentucky to provide assistance
  with career planning, job readiness, and life skills to aid clients in
  becoming self-sufficient; Middle Kentucky Transportation, providing transportation
  alternatives to places of employment, educational facilities, medical
  facilities and other areas; an educational program conducted during
  the fall just prior to college starting which helps low-income clients
  with tuition and books; a weatherization program which assists low-income
  families and those with disabilities with insulation against winter
  weather through applying techniques to conserve energy and to help
  utility costs become affordable; and a Title III-C Nutrition program providing
  meals throughout the four county area.
  
  
  
  
  

  Mountain Association for Community Economic Development (https://www.maced.org)
  

  
  The Mountain Association for Economic Development has a history of successful
  work in the designated area. The Owsley County Action Team, now an independent
  non-profit organization, was part of MACEDs Sustainable Communities
  Program for five years. MACEDs Business Development program complements
  resources locally-owned businesses need to prosper in todays business
  environment. MACED loan customers are typically unable to obtain sufficient
  financing from conventional sources, but share MACEDs commitment to
  building sustainable and vibrant local economies. This is best demonstrated
  when a company creates jobs from within the community, and shows a
  willingness to pay livable wages, build employee skills, and provide
  benefits such as health insurance and retirement plans.
  
  
  
  MACED offers below-market rates and innovative financing options by packaging
  loans with both public and private sources. They have contributed to
  the growth, financial stability, and long-term success of many area
  businesses. The staff is experienced in helping companies reach their goals
  by providing assistance with business planning, financial statements,
  and assessing and meeting their capital needs.
  
  
  
  
  

  Southern Kentucky Economic Development Corporation (https://www.southernkentucky.com)
  

  
  The Southern Kentucky Economic Development Corporation is a private, non-profit
  organization whose mission is to create jobs in a 27-county service area
  in southern Kentucky. The organization creates job opportunities by
  providing business and industry leaders access to capital and by attracting
  new business to the region. They accomplish this mission by providing direct
  loans, small business technical assistance, and by offering community/economic
  development services to local communities. SKEDC is certified by the
  U.S. Department of the Treasury as a Community Development Financial
  Institution and has invested $5.1 million in 31 industries established
  or expanding operations in southern Kentucky. Through SKEDC programs,
  more than 1,600 new jobs have been created in the region.
  
  
  
  SKEDC financed a 25,920 square foot speculative industrial building in
  Owsley Countys Lone Oak Industrial Park through its Industrial Building
  Loan Fund. This building is one of two speculative buildings funded
  through the loan program. A second building is located in Jackson County.
  The Industrial Building Loan Fund is made possible through a grant from
  the Economic Development Administration. Through the program, SKEDC
  provides funding to local communities to erect speculative buildings.
  The building project must involve a minimum investment of $250,000.
  Loans may only be made to purchase land and erect industrial buildings.
  
  
  
  
  There are a number of other local organizations who provide services to
  individuals in need and to raise the self esteem and motivation in individuals
  so they can become successful, self-supporting people. There are also
  many organizations dedicated to the economic growth of this area. The goals
  and actions listed in this document identifies some of the major partners
  who are committed to helping people become economically self-sufficient
  and succeed in their jobs. In addition to many other organizations too
  numerous to mention, we have established partnerships with federal agencies
  including HHS, HUD, USDA, EDA, EPA, ARC, Department of Energy, Department
  of Commerce, and many private foundations including the Mary Reynolds
  Babcock Foundation, the Christian Appalachian Project, the Environmental
  Support Center, the Southern Baptist Corporation, the Waitt Family
  Foundation and many local partners including Image Entry, Farmers State
  Bank, Peoples Rural Telephone Cooperative, Farm Bureau Insurance, Middlefork
  Insurance, Breathitt, Lee, Owsley, and Wolfe County Fiscal Courts,
  the Cities of Beattyville, Booneville, Campton, and Jackson, and many
  other local sources. And, as the years go by, many new partnerships will
  be created, not only with providers of services, including business,
  but the individuals who represent our successes.
  
  
  
  
  

  Signed Cooperative Commitment

  
  The following signatures represent our overall commitment to take full
  advantage of all benefits relating to a Renewal Community designation.
  Most importantly, they represent our commitment to the individuals
  in our community for whom these benefits are intended.
  
  
  
  Representing the Commonwealth of Kentucky: Paul Patton Governor
  
  
  
  
  Representing the Kentucky Cabinet for Economic Development:  
  
  
  
  
  Representing the Prestonsburg Regional Office of the Kentucky Economic Development:
   
  
  
  
  Representing Breathitt County: Robert E. Cornett, County Judge Executive
  
  
  
  Representing Lee County:  L. C. Reese, County Judge Executive
  
  
  
  County Judge Executive Representing Owsley County: Jimmie Herald, County
  Judge Executive
  
  
  
  Representing Wolfe County: Darrell Bumgardner, County Judge Executive
  
  
  
  Representing the City of Beattyville: (Lee County) Charles Beach, III
  
  
  
  Representing the City of Booneville: (Owsley County) Charles Long
  Mayor Mayor
  
  
  
  Representing the City of Campton: (Wolfe County) Richard Jett Mayor
  
  
  
  
  Representing the City of Jackson: (Breathitt County) Michael Miller
  Mayor
  
  
  
  Representing the East Kentucky Corporation:  Tom Jones Executive
  Director
  
  
  
  Representing the Kentucky River Area Development District:  
  
  
  
  Representing the Middle Kentucky Area  Development Council:
   Darrell Shouse Executive Director
  
  
  
  Representing the Mountain Association for Community Economic Development:
  Tom McRae President
  
  
  
  Representing the Southern Kentucky Economic Development Corporation:
   Greg Jones Executive Director
  
  
  
  
  

  GOALS AND ACTIONS

  
  
  

  GOALS AND ACTIONS

  
  Our goals and actions represent the following four of the six criteria
  outlined in the Renewal Communities Application Guide:
  
  
  
  
  
  
  
  •  An increase in the level and efficiency of local services within
    the Renewal Community, such as services for residents funded through
    the Federal Temporary Assistance for Needy Families program and related
    Federal programs including, for example, job support services, child
    care and after school care for children of working residents, employment
    training, transportation services, and other services that help residents
    become economically self sufficient.
  
  
  • Crime reduction strategies, such as crime prevention, including the
    provision of crime prevention services by non-governmental entities.
    
  
  
  • Involvement in economic development activities by private entities,
    organizations, neighborhood organizations, and community groups, particularly
    those in the Renewal Community, including a commitment from such private
    entities to provide jobs and job training for, and technical, financial,
    or other assistance to, employers, employees, and residents from the
    Renewal Community.
  
  
  • The gift or sale at below fair market value of surplus real property
    held by state or local governments, such as land, homes, and commercial
    or industrial structures in the Renewal Communities to neighborhood
    organizations, community development corporations, or private companies.
  
  
  
  
  
  
   The following identifies our proposed actions that meet the required
  goals.
  
  
  

  ---

  Goal 1:  To increase the level and efficiency
  of local services within the Renewal Community, such as services for
  residents funded through the Federal Temporary Assistance for Needy
  Families program and related Federal programs including, for example,
  job support services, child care and after school care for children of
  working residents, employment training, transportation services, and
  other services that help residents become economically self-sufficient.
  
  
  
  

  ---

  Actions:
  
  
  
  
  
  • Provide tools to assist families in become self-sustaining.
  
  
  • Create opportunities to earn a family wage.
  
  
  • Focus on individual needs and regional distinctions.
  
  
  • Partner with families and the community as a whole.
  
  
  • Provide opportunities for education and work experience.
  
  
  • Enlist the aid of other state agencies, local government and the
    private sector to expand work opportunities.
  
  
  • Provide access to entrepreneurial training and small business development
    programs for individuals and businesses in the zone.
  
  
  • Provide locally available access to basic and specific job skills
    training.
  
  
  • mprove access to safe, affordable childcare for working individuals
    throughout the zone.
  
  
  • Encourage the use of available transportation opportunities and market
    this information to individuals who live within the zone.
  
  
  • Provide assistance to farmers to take advantage of financial and
    technical resources available.
  
  
  • Expand and improve the availability of housing, including low-income,
    assisted living, and emergency housing services throughout the zone.
    
  
  
  • Create housing opportunities for individuals interested in renting
    or purchasing a home.
  
  
  • Improve communication between communities and schools and create
    more opportunities for involvement and input.
  
  
  • Improve the school drop-out rate throughout the zone.
  
  
  • Utilize the 21st Century Community Learning Center throughout the
    zone and offer access to individuals of all ages during and after school.
    
  
  
  • Improve and expand educational opportunities for adults and young
    people who have dropped out of school throughout the zone.
  
  
  • Enhance, improve, and expand the public libraries throughout the
    zone in order to offer a larger selection of materials and to improve
    public access.
  
  
  • Improve the publics availability to technology and technological
    resources and learning opportunities throughout the zone.
  
  
  • To improve accessibility to after-hours and emergency healthcare
    facilities for all individuals throughout the zone.
  
  
  
  
  
  
  
  

  Social Services and Assistance

  
  The State of Kentucky has many programs that aid families to become self-sufficient.
  Most notably is the Kentucky Transitional Assistance Program (K-TAP),
  administered through the Cabinet for Families and Children. K-TAP
  provides financial and medical assistance to needy dependent children
  in Kentucky and the parents, or relatives, with whom the children are
  living. This program offers temporary cash assistance to families in
  order to assist families in finding jobs or getting training that
  leads to a job. (See Attachment 1: Kentucky Title IV-A State TANF Plan,
  July 2001.)
  
  
  
  The K-TAP mission is to provide families with the tools to become self-sufficient
  while ensuring children are protected and valued. Their goals are
  to move their clients into full-time, unsubsidized employment, help
  their clients retain jobs and, when necessary, obtain re-employment, assist
  families to become self-sufficient, involving clients in work activities
  in order for them to become self-sufficient before their five year
  limit expires, and to ensure that children live in a safe, secure
  environment.
  
   
  
  Their approach is to develop partnerships with other state agencies, local
  governments, community based organizations and employers to provide
  linkages for Kentucky Works participants for services to reduce barriers
  to employment, to integrate services, to develop multiple strategies recognizing
  the varying strengths and needs of clients and communities, to encourage
  communities to develop broad based collaborations for local plans
  for welfare reform and regionalized economic development strategies,
  and to maximize all state and local resources. They also provide information
  and support to participants enabling them to recognize their own strengths,
  value work, formulate goals, choose options, and meet new expectations.
  They integrate the new mission into service delivery through training
  for case managers and communication with service providers.
  
  
  
   The Kentucky Cabinet for Families and Children (CFC) is responsible
  for the TANF block grant. TANF is administered by the Department for
  Community Based Services (DCBS) within the CFC. DCBS offices are located
  in every county. Case managers work in partnership with families to
  support their efforts toward self-sufficiency. Coordinators serve as program
  consultants in Kentucky Works policy and act as facilitators/resource
  persons with other agencies.
  
  
  
   Local CFC office staff are dedicated to making sure that all clients
  receive adequate information on available assistance and other opportunities
  for personal growth. The workers are caring and professional and work
  hard to make sure their clients understand their benefits and any time
  limits they may be facing. They especially encourage clients to take
  advantage of any educational and job preparedness and training programs
  to prepare these individuals for work. They make many home visits to
  stay in touch with those who do not keep regular appointments or find it
  difficult to travel to the office. Additionally, the CFC is involved
  actively in community programs and organizations and are more than
  willing to assist in any projects that can benefit those they serve.
  
  
  
  
  Middle Kentucky Area Development Council (MKADC) provides a weatherization
  program (which served 32 homes during the last year) which provides
  cost effective energy conserving home improvements to low-income families
  and those with disabilities. The program focuses on insulating against
  winter weather through applying techniques to conserve energy and to
  help utility costs remain affordable. With current funding, they plan
  to serve 45-50 homes. Additionally, they provide the Low-Income Heat
  and Energy Assistance Program (LIHEAP) which offers energy assistance
  to low-income individuals and families through two components: subsidy
  and crisis. Subsidy provides a one-time payment for heating costs. The
  crisis component serves clients who have received disconnect notices
  and will be without heat within five days. Payment amount for both
  components are determined by the family size, income, and primary source
  of heat used in the home, and is paid directly to the vendors. Last
  year, 4,943 individuals were served through the subsidy component and
  2,864 were served through the crisis component. They work through local
  Community Action Agencies to gather applications for these programs.
  
  
  
  
  Family and Youth Service Centers, located at each elementary and high school
  in every county, work with children and families on parenting skills,
  parent/child activities, and referrals to other organizations for services
  or assistance.
  
  
  
  The Caring Place, while also providing job training and support services,
  offers assistance with family management skills, access to agricultural
  assistance, home food processing and training, access to the food
  pantry, budgeting, counseling, access to domestic violence shelters, legal
  aid, disaster assistance, clothing assistance, prevention programs,
  health education classes, access to drug and alcohol counseling, school
  supplies, and tutoring.
  
  
  
   Kentucky Community Care provides mental health and drug and alcohol
  abuse counseling.
  
  
  
  
  

  Education and Work Experience

  
  We will continue working with state agencies such as the Cabinet for Economic
  Development, the Department for Employment Services (DES) and the Workforce
  Development Cabinet to take advantage of training opportunities offered
  to assist individuals to prepare for work. These agencies have been
  the backbone of training opportunities in the State of Kentucky and have
  a history of important involvement throughout the state with organizations
  trying to improve the lives of their people. One example of state
  involvement is to provide incentives for businesses to hire individuals
  and provide the necessary training by providing matching grants for
  training programs.
  
  
  
  The State of Kentucky, through the Cabinet for Families and Children, created
  an independent corporation within the Cabinet for Economic Development,
  called the Bluegrass State Skills Corporation (BSSC), providing grants
  for customized skills training of workers for new, expanding, and existing
  businesses and industries in Kentucky. Matching grants are awarded for portions
  of an employers eligible costs for training Kentucky residents in job
  skills ranging from entry level to advanced, including retraining, occupational
  upgrading, and skills upgrading of existing employees. The BSSC works
  with other employment and job training resources, and financial incentive
  agencies to design a training program customized to meet the specific needs
  of a company. Approved training can be provided by an educational institution,
  training consultants, or by the companys own trainers. BSSC funds
  can be used for curriculum development, instructor fees, instructional
  materials, and the purchase of training equipment (under capacity building
  programs).
  
  
  
  BSSC can also help to cover a portion of the travel costs for the employees
  of new, expanding, and existing Kentucky industries that must be sent
  outside of Kentucky or the United States for training as company instructors.
  The instructors must return to the company and train other employees on
  similar equipment, processes, and procedures. BSSC can reimburse the
  company partially for the instructor/trainers out-of-state travel and
  lodging expenses. BSSC also provides existing companies the ability to
  claim state income tax credits for 50% of their approved costs for occupational
  and skills upgrade training costs. The credits are limited to $500
  per employee and cannot exceed $100,000 per company per biennium. Training
  may be provided by company employees, educational institutions, or
  training consultants. Priority will be given to high performance companies
  as determined by the BSSC, and total investment credits are limited
  to $2,500,000 per year.
  
  
  
  The Kentucky Workforce Development Cabinet (https://www.kycwd.org), through
  the Department of Employment Services (DES) provides assistance to Kentucky
  employers in the areas of employee services. The DES provides recruitment,
  screening, and referral services. These services are provided at no
  cost to either employers or employees. Through its local offices located
  across the state, the Department performs screening of potential employees
  for the individual employers selection criteria, assesses job applicants
  work experience, education, and training, refers only qualified applicants
  to the employer for potential interviews, assists with the initial documentation
  of foreign workers, and certifies qualified job applicants whose employment
  will qualify the employer for federal and state tax incentives. Recruitment
  and placement services have been so successful that many employers
  now accept job applications only through the DES.
  
  
  
  The Office of Development and Industry Relations within the Workforce Development
  Cabinet coordinates the Cabinet and its agencies business and industry
  training activities. This office acts as a one-stop-broker for both
  local and statewide needs. Industry-specific, customized training,
  screening, and assessing are offered by agencies within the Workforce Development
  Cabinet.
  
  
  
  The Kentucky Community and Technical College System (https://www.kctcs.net)
  provides access to educational programs at more than 100 extended sites,
  centers, and campuses located across the Commonwealth. The 29 communities
  and technical colleges in the KCTCS offer various human resource services
  that can impact employee performance levels. The KCTCS may offer assistance
  in the hiring and selection process utilized by Kentuckys new, existing,
  and expanding businesses. The Work Profiling System is a structured
  job analysis utilized by the community colleges to provide companies
  with accurate information regarding task analysis, staff selection, employee
  development, competency identification, and training needs assessment.
  This system has been invaluable to Kentucky businesses in the development
  of customized employee recruitment and screening processes that may
  include industry-specific application screening, behavioral and ability
  assessments, and structured interviewing. Each college has a business
  and industry liaison available to analyze the individual needs of business
  and industry and to propose ways to meet those needs. In addition,
  the KCTCS Mobile Training Unit moves around the state delivering on-the-site
  training in CNC, PLC, and CADD/AutoCADD. Distance learning classes, teleconferences,
  and satellite feeds are part of the services offered by the colleges.
  Locally, Hazard Community College provides these services through the
  Lees College Campus in Jackson (Breathitt County), and by videoconference
  through CenterNet and KTLN sites.
  
  
  
  It is a goal of the Department for Technical Education and the Cabinet
  for Workforce Development to create a collaborative relationship with
  local school districts to enhance growth in Kentuckys educational community.
  The Kentucky Department for Technical Educations state operated system
  of Kentucky TECH schools provides quality technical education through
  52 secondary schools known as Area Technology Centers. The primary purpose
  of area technology centers is to serve high school students by enhancing
  and expanding student career options that lead to continuation of education
  at the postsecondary level and/or successful employment upon graduation
  from high school. Students receive instruction in sound academic principles,
  theory, laboratory and clinical experiences to ensure they can compete
  successfully in todays changing workplace. The area technology centers
  serving the designated area are located within Lee and Breathitt Counties.
  
  
  
  The Kentucky Department for Adult Education and Literacy (https://www.state.ky.us/agencies/wforce/dael)
  is a network of local instructional programs funded throughout the
  state that are designed to assist adults in acquiring knowledge and developing
  the potential to achieve their goals in the workplace, at home, and
  in society. Their programs include adult education which offers basic
  education skills to adults in their roles as learners, workers, family
  members, and citizens to enable them to develop coping skills for living
  and wage earning, and to better their self-concepts. The GED classes
  provide adults with the skills necessary to pass the high school equivalency
  exam. The Family Literacy program is an intense on-going program which
  provides educational opportunities for family members to learn together.
  Finally, the SKILL program provides customized workplace essential skills
  classes to business and industry which enhance worker skills enabling
  them to cope with their occupations and increase wage earning potential.
  Adult education centers are located in each county located within the
  designated zone.
  
  
  
  The State has also created the Kentucky Virtual Library (1998), the Kentucky
  Virtual University(1999), and the Kentucky Virtual Adult Education (2001)
  websites available on-line. These services offer instant access to
  information as well as educational opportunities. These sites offer
  one-stop access to affordable college credit courses and professional development
  programs as well as access to literacy information, curriculum, resources,
  and services in an easy-to-use and motivational format. (https://www.kyvu.org;
  https://www.kyvae.org; https://www.kyvl.org)
  
  
  
   Locally, There are a number of available opportunities related to
  job skills, job preparedness, and job placement. All compliment and
  enhance, rather than duplicate services in order to offer more diverse
  training programs to a broader group of people.
  
  
  
  The Owsley County Action Team implemented a Steps-to-Success Welfare-to-Work
  training program with WTW funds through the Eastern Kentucky Concentrated
  Employment Program. This program was designed well, however, qualifying
  restrictions kept many from attending. This program allowed us to serve
  only the hard-to-serve group of individuals who have received KTAP for
  more than two and a half years. This group of individuals are the hardest
  to motivate. There were over 50 individuals who wanted to take the training,
  however, because they only received food stamps and a medical card,
  or, if they were underemployed or temporarily unemployed, were married,
  or part of the working poor, they did not qualify and were not allowed to
  be served.
  
  
  
  The community has expressed a need for training programs available to anyone
  who wants to receive training and who is in financial need of assistance
  in getting that training. Therefore, the Owsley County Action Team has
  plans to re-implement the Steps to Success training program, create
  a curriculum related to the use of computer technology in a work environment,
  utilize the PowerUp computer lab that will be installed soon, and CenterNet,
  and will seek funding that will allow them to broaden the qualifying
  guidelines so that more individuals who need training can get training.
  
  
  
  
  Regarding the use of technology, the Owsley County Action Team is becoming
  an important technical resource in that they have expanded the availability
  and public interest in and use of computers and video conferencing capabilities.
  Recently, the Action Team partnered with the Center for Rural Development
  to implement CenterNet, a video-conferencing, distance learning, and
  public Internet service. This provides a large and small video conferencing
  unit, furniture, four public access computers, and Internet access
  through a T1 line. Additionally, the soon-to-beinstalled PowerUp
  computer lab and Vista worker will coordinate computer and technology
  programs only adding to the availability of training utilizing technology.
  
  
  
  
  CenterNet is also located in Breathitt County at the Lees College Campus
  of Hazard Community College. This system will be moved to the Jefferson
  Hotel Skills Center as soon as renovations are complete. CenterNet is
  in the process of being installed in Lee and Wolfe Counties as well. We
  plan to promote and utilize CenterNet to provide unique job skills training
  opportunities by video conference. Through the Center for Rural Development,
  we can offer many types of training to local individuals without them
  having to leave the county to receive that training. Individual counties
  partnered with the Center to assist with funding the maintenance costs
  over a five year period. CenterNet is currently in the process of being
  installed in Lee County in downtown Beattyville in the former Congleton
  Brothers store. The People Encouraging People (PEP) Coalition will manage
  the operation of the site and the facility. The site in Wolfe County
  will be located on Highway 15 in Campton in the Kentucky River Community
  Care Centers outpatient facility.
  
  
  
  Additionally, we will work with the Jackson County Vocational School and
  their entrepreneurial training program and other regional vocational,
  and community college and university programs to increase the participation
  in their programs by adults and young people who have dropped out of
  school. The programs in Jackson County were created as a result of a Round
  I Empowerment Zone designation.
  
  
  
  The Caring Place in Lee County works to assist current K-TAP recipients
  in developing essential life skills needed to obtain a job. They maintain
  a supportive environment, while linking participants with potential
  employers. Their goal is to assist K-TAP recipients in the transition from
  receiving benefits to entering the workforce. They offer mentoring services
  to all active clients where they receive support, encouragement, resources,
  job training, and positive motivation toward self-sufficiency. During
  the 2000-2001 fiscal year, there were 85 individuals enrolled in job
  readiness activities, 41 completed the program and 76 secured paid employment
  
  
  
  
  The Caring Place receives referrals from the Cabinet for Families and Children.
  After an initial assessment, the participant is placed in job readiness
  activities that are based on individual needs. Some of the services
  provided by partnering agencies are basic academic skills, employment skills,
  occupational skills, agricultural assistance, home food processing and
  training, food pantry, budgeting, counseling, domestic violence shelter,
  legal aid, disaster assistance, clothing assistance, community education
  and prevention programs, CNA classes, health education classes, nutrition
  programs, environmental services, drug and alcohol counseling, crisis
  counseling, school supplies, and tutoring for adult education participants.
  
  
  
  
  The Caring Place also works with several employers in order to secure paid
  employment for their participants. CBS Personnel in Winchester, Kentucky
  sends staff to the Caring Place every six weeks to take applications.
  They also provide workshops to participants on how to prepare for a job
  interview. CBS Personnel offers staffing services, rather than temporary
  services, for several companies in eastern Kentucky.
  
  
  
  The Owsley County Action Team, during the Steps to Success Welfare-to-Work
  Training Program, worked with the local Cabinet for Families and Children
  on the possibilities of receiving funding from the Cabinet to provide
  instructors for job skills training activities. It was explained that unless
  we become a component of the Cabinet officially, they could not work
  with us on funding these types of programs. However, we do have the
  support of our local Cabinet for Families and Children in working with
  state officials to make Owsley County Action Team a component in order to
  provide training. The Owsley County Action Team is considering becoming
  an eligible training provider, depending on funding availability and
  resources.
  
  
  
  There are a number of individuals interested in learning about computers
  that are eligible for, or receiving K-TAP. The Action Team recently
  partnered with The Caring Place in Lee County to provide basic instruction
  in Windows 95 and Microsoft Word to 15 individuals.
  
  
  
  The Owsley County Action Team is also working with Image Entry, a local
  data entry company, to provide their specific job skills training through
  Action Place. When Image Entry located in Owsley County, they provided
  the Owsley County High School a server, a classroom telephone, and
  software needed to train students in data entry work. However, the majority
  of students who complete the class and go to Image Entry for a job
  cannot pass the data entry test and most cannot use a keyboard for
  simple typing tasks. Because these classes are offered through the school
  system during normal school hours, adults cannot take advantage of that
  training.
  
  
  
  Therefore, we have proposed to work with Image Entry to provide this training
  at the computer lab facilities at Action Place. This would free up quite
  a bit of space at Image Entry for them to hire additional employees.
  Additionally, there would be more qualified applicants to deal with and
  adults would be able to receive training. Image Entry will provide the
  software necessary to provide the training and will train Action Team
  staff in order to prepare them for instructing the classes. However,
  funding will need to be secured for a staff person to provide that training.
  
  
  
   Additionally, the Booneville/Owsley County Industrial Authority is
  considering the incorporation of a computer program where 50 computers
  could be made available to individuals who work from home. Referrals
  would come from Image Entry in Owsley County to provide computers to
  employees who have worked in their plant for more than one year so that
  they can work for the company from home. This will allow more jobs to
  be created within the plant, while giving some employees an opportunity
  to work while at home.
  
  
  
  The designated zone will work together to create a Job Skills Training
  Resource Directory listing all available training and job support opportunities
  within the zone, region and state. This resource directory will assist
  individuals in identifying appropriate training opportunities that fit their
  needs as well as assisting case workers to help individuals understand
  their options.. This directory will be printed and made available to
  the public through action teams, local training providers and other
  organizations.
  
  
  
  Action teams and industrial authorities will work together with the adult
  education and social service providers to increase the number of adults
  enrolled in GED and adult literacy training programs. This will be accomplished
  through creative marketing and through the Job Skills Training Resource
  Directory. We will work through the Cabinet for Families and Children
  to further encourage recipients to take advantage of opportunities available
  while they are receiving benefits.
  
  
  
  We believe that by focusing a large portion of our attention on the youth
  sector, we can break the cycle of poverty and instill the belief in our
  children that welfare is not the answer to becoming and remaining self-supporting.
  By teaching job preparedness and skills training, including a focus on
  work ethic, we hope to help young people understand the need for responsibility
  and commitment when thinking about work.
  
  
  
  In order to create a strong work ethic among our youth, we will work with
  county boards of education in order to improve student access to advanced
  placement courses and to increase the number of students enrolling in
  vocational courses. In Owsley County, during community meetings and
  through surveys, individuals, including students, complained that there
  were not enough students signing up for these kinds of classes, which
  keeps the few that do sign up from being able to attend. Students in
  Owsley County are transported by bus to the Lee County Area Vocational
  Center for these types of classes If possible, we would like to work
  with the area vocational schools to provide instructors who can travel
  to the counties that do not have area or county vocational school
  to provide these types of classes to students who are interested.
  
  
  
  
  The designated area will work with local and regional community colleges
  and universities to provide job preparedness and skills training by
  video conference through CenterNet to all school children and adults.
  Currently, three Hazard Community College students are taking Economics
  201 by video-conference at the Owsley County Action Teams CenterNet facilities.
  They are working with Hazard Community College and other universities
  to provide more classes for individuals who are interested in lessening
  their travel time to school.
  
  
  
  The Jefferson Hotel Skills Center in Jackson, Kentucky (Breathitt County)
  has received funding for major renovations. They have planned to include
  space for training workshop opportunities. Additionally, the CenterNet
  facilities will be moved from the Lees College Campus of Hazard Community
  College, a temporary location, to the Jefferson Hotel Skills Center when
  renovations are complete. For the Breathitt County Action Team, this
  center means attractive, accessible office space. Currently, the Action
  Team office is located above the public library in downtown Jackson.
  Handicapped accessibility is a problem, and space is limited. This new
  facility will give the Breathitt County Action Team the exposure it
  needs to begin providing the services and programs it has planned, as
  well as having direct access to CenterNet facilities that will be utilized
  in the implementation of many activities outlined in their strategic plan.
  (See Attachment 2: Jefferson Hotel Skills Center.)
  
  
  
  Many programs are available locally aimed at youth prevention and career
  preparation. For example, in Owsley County, the Fund For Excellence
  program will celebrate the graduation of its first class this year.
  This will be the largest graduating class in the history of Owsley County
  High School and many like to think that this is a direct result of the
  Fund for Excellence and other after school and extracurricular programs.
  The Fund was started in 1994 with the first 7th grade class entering
  the program in 1995. The program is designed to raise expectations on the
  part of parents, students, and the community through disseminating information
  concerning opportunities, creating an entrepreneurial spirit in our
  young people, and providing incentives for high school graduation
  and post-secondary education. (See Attachment 3: Fund for Excellence.)
  
  
  
  
  The board members of the first class worked extensively with students and
  parents on activities designed to build a nest egg for investment. They
  started with a $1,000 grant from the Brushy Forks Teamwork for Tomorrow
  program and used these funds to host a Spring Horse Show, which profited
  a little over $4,000, and from later projects such as selling chances on
  donated Appalachian handmade quilts and other programs. They will graduate
  this year with approximately $17,000 which they will divide among the
  students. The Fund For Excellence also has three $10,000 endowments
  from the Baker Family, the Turner Family, and the Gabbard Family, all from
  Owsley County. Interest on these endowments provides three annual scholarships
  to Owsley County High School graduating seniors. The amounts vary based
  on interest earned. There is also a $5,000 endowment from the Annual
  Earl Glenn Jackson BEEK Award to provide an award to a high school student
  who has contributed most to the environment.
  
  
  
  In 2000, the Fund for Excellence received $50,000 from the Appalachian
  Regional Commission to create and operate a Fund for Excellence Youth-run
  Business. It has been decided this will be an office supply store which
  will also local handmade crafts and other items. Although plans are to
  open the store by the beginning of the next school year, however, planned
  renovations at Action Place will cause a delay.
  
  
  
  This project, although very successful, has been hampered by lack of staff.
  All activities have been accomplished by volunteers with no coordination.
  The evidence of this graduating class accomplishments justifies the
  need to provide staff to coordinate the Fund for Excellence program
  so that more successful students graduate from high school.
  
  
  
  Additionally, each school system offers the Extended School Services Program
  (ESS) to assist failing students to make up work and improve their grades.
  
  
  
  
  
  

  Childcare

  
  Concerning childcare, statistics show that the highest poverty levels among
  children were in the under five year old group. Compare that with the
  percent of children under 18 in general and the percentage is much lower.
  After discussing this with other parents and childcare providers, it was
  determined that it is cheaper for a mother to stay at home rather than
  work during the first five years due to childcare expenses, transportation,
  and other experiences, such as health problems in children under 5,
  that require more time than after a child starts kindergarten.
  
  
  
  Many parents want their children to stay in a daycare center environment
  with activities provided that enrich their childrens learning experiences.
  We will work with local State Certified Childcare Providers to examine
  ways in which we can expand the childcare services already offered.
  
  
  
   In an effort to efficiently serve as many children as possible and
  to support welfare reform efforts, the State of Kentucky, through the
  Cabinet for Families and Children, provides a variety of childcare assistance
  programs. Federal and state funds pay for child care assistance. The main
  fund source is the Child Care and Development Fund. Other federal funds
  include TANF and Welfare-to-Work.
  
  
  
  In order to administer assistance statewide, the Cabinet has contracted
  with five regional service agents. These agents determine eligibility,
  match clients to available child care resources, help families find
  quality child care, process assistance payments, and address unmet child
  care needs. The Eastern Kentucky Childcare Coalition is the agent who
  serves Breathitt, Lee, Owsley, and Wolfe counties. (See Attachment
  4: Regional Service Agents for Childcare.)
  
  
  
  There are a number of children being served through the childcare program
  in this area. Currently, there are 88 certified childcare providers
  with approximately 271 children being served. To be eligible, child
  care must be needed for parents to work or to be in a K-TAP or Welfare-to-Work
  program; to protect a child from abuse, neglect or removal from the home;
  for a teen parent to attend high school; or for education or vocational
  training. Eligible children must be under the age of 13, or under the
  age of 18 if physically or mentally incapable of caring for him or herself,
  or under the age of 18 and under court supervision.
  
  
  
  Child care providers must be licensed, certified, or enrolled unless they
  are a qualifying relative . Parents or persons living in the same household
  as a child needing care cannot be paid for caring for that child. Relatives
  must meet the same minimum requirements as enrolled providers. Families
  who are discontinued from K-TAP due to employment are eligible for childcare
  assistance for 12 months from the date they leave K-TAP, as long as
  their income does not exceed 85% of the state median income scale
  and they remain employed. The percent then decreases according to
  income level. The maximum income eligibility is 165% of the federal
  poverty guideline. Because these childcare programs stress family
  responsibility, except for protective service cases and families with
  a monthly income below $900, all families will pay for part of their
  childcare expenses. Childcare assistance is not granted when free
  programs are available and accessible.
  
  
  
  The Middle Kentucky Area Development Council is the primary coordinator
  for the Head Start program in the designated zone. Approximately 408
  children are served between the ages of three and five. In Owsley
  County the Head Start program also offers infant care and home-based services.
  Should a designation be received, and a need for childcare increases
  due to an increase in jobs, Middle Kentucky is prepared to secure funding
  in order to expand the Head Start program so that more children and
  families can be served.
  
  
  
  Through Vision 2000, the Mountain Tots Early Childhood Development Center
  in Breathitt County plans to purchase property and build adequate facilities
  as well as expand the program to provide services 24 hours per day.
  The center currently rents their facility and is limited to 49 slots. This
  childcare center is primarily funded through the Community Collaboration
  for Children grant awarded bi-annually by the Kentucky Cabinet for
  Families and Children. The expense for expansion of this facility includes
  construction, equipment, and the purchase of property and is estimated to
  cost $350,000. This program has been, initially, a subsidiary program
  under Vision 2000 and is currently in the process of establishing itself
  as a separate entity by applying for non-profit status.
  
  
  
  Breathitt County also plans so research the feasibility of a sick room
  inside a child care center or located adjacent to the center in a much
  smaller facility attached. Often times, individuals have problems with
  productivity on the job when children are sick. If a place was available
  for childcare for children who are not so sick that they require medical
  attention, but dont feel well enough to be around other children, parents
  would have a much better opportunity to improve productivity on the
  job and rest assured that their children, although feeling under the weather,
  are being well taken care of in a caring, safe environment. If this project
  is found to be feasible, we will work with local childcare providers
  to implement these services throughout the zone.
  
  
  
  In addition to childcare, a much needed service in this area is adult child
  care. Many families are caring for elderly relatives in their homes.
  These individuals often require as much, or more care than children.
  The only facilities currently available to assist with adult daycare is
  the Geri Young Home in Lee County. Their hours are 8:00 - 5:00 and they
  serve 31 individuals. They are licensed to serve 34 individuals and
  provide healthcare professionals to assist in their care. Should a designation
  occur, there will be a need for more services of this nature throughout
  the zone. We will work together to create programs similar to the Geri
  Young Home in other counties within the designated area.
  
  
  
  Recently, representatives from Breathitt, Lee, Owsley, and Wolfe Counties
  got together to form a regional Vision 2000 organization. One of the
  main topics discussed as a goal was child and adult daycare. We will
  identify ways we can improve and expand the availability of quality child
  and adult daycare centers in order to assist families in keeping jobs
  and increasing productivity on the job.
  
  
  
  
  

  Transportation

  
  Transportation is one of the main challenges facing people making the transition
  from welfare to work. There is a mismatch between where most entry-level
  and service sector jobs are located and where most welfare recipients
  live. Many entry-level jobs require evening or weekend hours, and many
  parents going to work also need transportation in order to access child
  care, which further complicates their commute to work Having a car can
  make a tremendous difference. Information from the Urban Institutes
  National Survey of American Families show that twice as many welfare
  recipients with cars were working than those without cars. Many welfare
  recipients do not have cars.
  
  
  
  In addition to on-going state road projects, Kentucky has taken a comprehensive
  approach to providing coordinated transportation to the needy. Four
  Cabinet offices Families and Children, Health Services, Workforce Development,
  and Transportation combined transportation resources to develop a
  new coordinated transportation system for all their participants. Empower
  Kentucky provides transportation services to individuals through 16
  regional providers. In this designated area, we are served by the LKLP
  Community Action Council, through the Daniel Boone Transit Authority
  and the Middle Kentucky Area Development Council Transportation System.
  Although this transportation system is used mainly for medical purposes,
  K-TAP recipients also take advantage of these services in order to
  attend training programs and travel to work.
  
  
  
  If a designation is made, business opportunities and the number of jobs
  available will increase along with the need for transportation services.
  With that in mind, we are committed to analyzing information on where
  welfare recipients live, locations of the jobs for which welfare recipients
  are qualified, location of training centers and family and child care
  centers, and available transportation resources. With this information,
  we will identify strategies to increase the availability of resources
  available to individuals to keep them employed. Middle Kentucky is ready
  to expand into other areas if needed.
  
  
  
  Currently, the K-TAP program provides transportation assistance to individuals
  who secure paid employment. These services are available for up to
  12 months after beginning work. An adult taking part in KWP may get
  help with childcare, transportation, and other items needed to work, or
  needed for a work or training activity. A family may also get help with
  things needed in order to keep working including uniforms, clothing,
  or tools needed for the job; car license and registration fees, insurance,
  tires, brakes, and other car repairs; and expenses for moving to a new
  home needed to get or keep a job.
  
  
  
  A transportation brochure will be made available throughout the zone in
  order to make the public aware of all transportation opportunities and
  benefits currently available. Additionally, they will work to recruit
  or create a public transportation program for general transportation needs
  among individual community members. Many counties have Park and Ride lots
  available. A great number of individuals living within the zone have
  to travel for up to 2 hours to reach their work place. We will encourage
  the use of these park and ride stations for carpooling and for taking
  advantage of other transportation options. We hope that by marketing
  the stations and other options, individuals might be encouraged to seek
  employment, even if they do have to go out of town to find a job.
  
  
  
  
  
  

  Communication

  
  Although many individuals, including welfare recipients, have been provided
  an array of benefits for many years, most still do not understand or
  know much about other programs available to assist them in becoming
  self-sustaining. Clearly, this is not a result of a lack of communication
  between clients and caseworkers. Our Cabinet for Families and Children
  offices have caring staff who try to inform individuals about all programs
  available. However, there is a need to make sure individuals know more
  about available benefits in order to continue moving people from welfare
  to work.
  
  
  
  We plan to work with the Cabinet for Families and Children to create a
  unique, interesting publication that explains in detail all the programs
  available that can in any way assist an individual in becoming a self-supporting
  and self-sustaining.
  
  
  
  
  

  Agricultural Assistance

  
  Farming in eastern Kentucky, particularly tobacco farming, provides many
  families with annual income. In the recent years, this area has worked
  hard to educate our farmers about issues relating to the decrease in
  demand for tobacco, and most importantly, the tobacco settlement funds
  that have been allocated to states, and then to counties, for use in alternative
  crop programs, healthcare and tobacco education and prevention. In
  Kentucky, and particularly eastern Kentucky, tobacco has provided the
  majority of income to area farmers. These farmers are feeling the effects
  of tobacco legislation. For too long, small tobacco farmers have had to
  work very hard to earn the money needed to simply survive.
  
  
  
  Farmers have many manual labor and machine skills that can benefit them
  in the workplace. Additionally, they are usually people who are proficient
  at handling the financial and technical aspects of being in business.
  Many of these farmers represent an untapped human resource as far as
  the labor market goes. With the tobacco settlements and the lesser demand
  for tobacco, many farmers have quit farming and have begun to seek paid
  employment elsewhere.
  
  
  
  We will work with the local extension offices, state officials, and state
  universities to provide technical assistance to farmers and to research
  alternative crops targeted toward small family farms. There is money
  available through the tobacco settlement fund to assist local farmers in
  changing their crops or creating businesses that employ farmers. They
  simply need help understanding the process of accessing that money
  and the knowledge and assistance to create a business plan. Currently,
  Owsley County has $396,272 in the local share of Phase I Tobacco Settlement
  Funds that Owsley County residents can apply for to implement these
  kinds of projects. One application round was completed, however, so
  far no projects have been approved because the plans have only impacted
  family members. Breathitt County currently has $198,605 available, Lee
  County has $126,088 available, and Wolfe County has $340,746 available.
  
  
  
  
  Additionally, there is a state share which organizations and other entities
  can apply for to implement other agricultural, medical, or prevention-related
  programs. We will tap that source for medical equipment that is compatible
  with the CenterNet video conferencing system to provide access to specialty
  medical care while not having to travel so far to get there.
  
  
  
  We intend to create and conduct workshops targeting farmers to provide
  information on alternative crops, agricultural research and access to
  technical assistance from the University of Kentucky and other research
  institutions, and other topics of interest in helping farmers become more
  selfsustaining. We will also assist farmers in writing applications for
  the county shares of the tobacco settlement money and will provide
  them access to technical resources that are available to assist them
  in the implementation of quality agricultural ventures. We will work with
  the Small Business Development Center from Morehead University to provide
  workshops to individuals on how to start their own business.
  
  
  
  Additionally, the Action Team will create a marketing program aimed at
  recruiting farmers who have ideas for projects to participate in these
  workshops as well as other programs offered through other organizations
  such as the county extension offices, soil and water conservation district
  offices, and the University of Kentucky.
  
  
  
  Farmers will be encouraged to research alternative agricultural activities.
  Representative Marie Rader is working hard to promote the research
  of and farming of wine grapes. In recent years, several wineries have
  become operational in eastern Kentucky and north Tennessee and Virginia.
  Prior to prohibition, it is said that Kentucky was a prime producer of
  wine grapes in this country. This is being considered as a way of moving
  tobacco farmers into alternative crops that are in demand.
  
  
  
  
  

  Domestic Abuse

  
  Domestic abuse, as is common among many small, rural communities, is a
  quite problem for our area. While discussing health issues with doctors
  and nurse practitioners in Owsley County, they noted that most official
  statistics show low levels of domestic abuse, however, they seem to treat
  a lot of cases. Additionally, when shelter is needed in a domestic abuse
  situation, individuals are usually referred to shelters outside of the
  area, (1) because we do not have one available locally, and (2) because
  sometimes it is necessary to keep their location a secret. Additionally,
  when emergency crisis happen, such as fire, individuals often times have
  no where to go.
  
  
  
  The Cabinet for Families and Children offers a Relocation Assistance Program
  available to adult KTAP recipients who need to escape from a domestic
  violence situation. The number of times families can utilize Relocation
  Assistance in order to escape domestic violence situations is not limited.
  A family may get up to $900 in a one-time Relocation Assistance payment
  for verified moving costs.
  
  
  
  Within the designated zone, the LKLP Safe House is available in Hazard,
  Kentucky (Perry County) offering a 24-hour crisis line for immediate
  help, temporary lodging for 30 days at no cost, a safe environment for
  abused women and their dependent children, information and referrals to
  legal options, financial aid, housing, and medical services. GED and self-improvement
  classes are available to residents and former residents. Court advocacy
  and counseling by Certified Domestic Abuse Violence Counselors is
  available including hospital advocacy and support groups for nonresidents.
  Other shelters available include Saras Place in Elliott County and the
  Resurrection House in Lee County. Additionally, the Cumberland Mountain
  Outreach assists individuals associated with domestic abuse through
  the donation of clothing and temporary emergency shelter.
  
  
  
  We see a need for an emergency/domestic abuse shelter within the zone not
  only to provide area individuals a safe haven, but provide shelter for
  other counties so that victims location can remain a secret. The
  local churches are also active and willing to help in domestic abuse situations.
  Through food pantries and other services, the faith-based organizations
  assist individuals with necessities and spiritual guidance.
  
  
  
  
  

  Housing

  
  Lack of decent, adequate housing is a problem for many individuals. Low-income
  apartments are known to remain at capacity with waiting lists used to
  handle the large number of requests. Rental property is difficult to
  locate. Should a designation be made, we will develop a plan to identify
  the most efficient and cost effective manner in which to approach the
  creation and expansion of housing, including low-income housing facilities
  throughout the zone. Available housing in general is a problem within
  the entire zone. Although statistics show several houses vacant, many
  of these homes are in terrible disrepair and are not considered safe. Some
  of the homes belong to families who, culturally, like to keep their property
  within the family. We will recruit real estate companies to build and
  operate apartments and other housing facilities available to everyone,
  including low-income individuals. We will work with regional, state, and
  federal sources to identify ways to improve the availability of low-income
  housing in the designated zone through the possible creation of a regional
  housing authority.
  
  
  
  The USDA Rural Housing Service provides local staff to assist individuals
  in accessing the lowincome housing loan and grant programs available.
  According to local RUS staff, they are not getting enough applications
  from Owsley and some surrounding counties for these programs. They
  are encouraging organizations and other service providers to provide information
  and referrals for services to low-income individuals involved in their
  programs.
  
  
  
  The Christian Appalachian Projects is involved in several housing projects
  including grants and loans for constructing new housing and a program
  that recruits volunteers to the area to assist individuals with housing
  improvements such as aluminum siding, insulation, and roof repair.
  
  
  
  
  In Lee County the Lee County Housing authority coordinates the low-income
  housing apartment program. The Beattyville Affordable Housing Authority
  has built and sold over 20 homes. Additionally, the Habitat for Humanity
  organization is active throughout the zone.
  
  
  
  We will create a marketing piece aimed at individual community members
  outlining all the benefits of the RC designation and what it means to
  them. Included in the publication will be a list of all available
  resources and services available throughout the zone and how they can
  access these benefits.
  
  
  
  
  

  Public Access to Technology

  
  In order to be successful in what is currently termed as the new economy,
  individuals must develop computer skills. This area has been involved
  in bridging the digital divide through the use of public computer programs
  aimed at improving skills through casual use by the public. All public
  libraries have public computers available with Internet access. Many
  individuals utilize these computers for completing homework, research,
  or communication through e-mail.
  
  Additionally, The Mountain Association for Community Economic Development
  (MACED), with funds from the U.S. Department of Commerce TOP program,
  implemented the Choosing to Learn program which provided three public
  access computers and three laptops for use in a laptop lending program
  in four eastern Kentucky counties including Owsley and Breathitt. Although
  the laptop lending program is successful, the expenses relating to public
  computer dial-up access in country stores was hurtful. Over 1,000
  individuals have checked out a laptop to do a variety of tasks.
  
  
  
  Due to the success of the laptop lending program, we will work to increase
  the number of laptops available through the lending program. Both the
  Owsley County and Breathitt County Action Teams have served as the
  lending agents and the computers have been checked out hundreds of
  times by individuals needing to complete college or high school work, Internet
  research, work done at home, or for just plain fun. Based on laptop
  lending experience, we see a need for 20 additional laptops in the
  lending program. This would add an additional five computers to the Owsley
  and Breathitt County area and five to start a lending program in Lee
  and Wolfe.
  
   
  
  The most difficult obstacle that this area faces in regard to implementing
  technology programs is staffing. All organizations within the zone
  find staff funding the most difficult to obtain. For this reason, we
  propose to place four Vista workers within the zone to assist with the
  coordination of programs such as PowerUp, laptop lending, and especially
  distance learning through CenterNet.
  
  
  
  
  

  Healthcare

  
  All community residents expressed a need for after-hours and weekend, non-emergency
  healthcare availability. Currently, many residents must travel more than
  45 minutes to reach an emergency room after hours. We will work with
  local healthcare providers to work out an arrangement to solve this
  issue. It has been suggested by the community that healthcare providers
  rotate their services after hours.
  
  
  
  The counties will work together to create a resource directory listing
  all healthcare providers in the area and what their specialities are.
  At the same time, industrial development organizations and chambers
  of commerce will work to recruit specialty physicians to the area. The
  Breathitt County Action Team will work with the Kentucky River Medical
  Center to expand the number of beds available.
  
  
  
  Since the inception of CenterNet at the Owsley County Action Team facilities,
  staff has been working with the Center for Rural Development to expand
  the uses of the technology. A nurse practitioner and a doctor serving
  Owsley County are interested in utilizing the CenterNet equipment
  to conduct medical appointments between themselves, local patients, and
  specialists in areas such as the University of Kentucky Medical Center
  in Lexington. However, we need additional equipment in order to provide
  this service.
  
  
  
   A recent article in Readers Digest states that more of the tobacco
  settlement funds need to be spent on healthcare related programs as
  it was intended. We intent to apply through the state for funds to expand
  the equipment needed in order to provide these medical services to the
  community at all CenterNet facilities within the zone.
  
  
  
  We will also utilize the programs and technical assistance and advice offered
  through the partnership between HUD and HHS on the EZ/EC/RC programs.
  
  
  
  Handicapped accessibility is a critical issue in our area. For instance,
  in Owsley County, the courthouse doors open to the outside, and the
  wheelchair ramp is at such an incline that one resident cannot get
  his wheelchair up that hill unless he is in his motorized chair. Until
  recently, there were no handicapped accessible restrooms anywhere in
  Booneville. For this reason, the action team, with funds received from
  the Steele Reese Foundation, will renovate the library bathroom to make
  it handicapped accessible and open to the public. Organizations throughout
  the zone will work toward making handicapped accessibility a priority
  and work to eliminate these obstacles.
  
  
  
  In addition to all of these programs, the state, regional organizations,
  and each city and county within the designated area have on-going programs
  to enhance, improve, and expand the availability of basic local services
  such as water and sewer service, fire protection, emergency medical services,
  and police protection as well as improving transportation through bridge
  and road improvements and expansions.
  
  
  
  
  

  ---

  Goal 2:  Increase crime reduction strategies,
  such as crime prevention, including the provision of crime prevention
  services by non-governmental entities.
  
  
  

  ---

  Actions:
  
  
  
  
  
  • Continue the implementation of 911 services throughout the zone in
    order to provide a quicker response time.
  
  
  •  Increase the use of technology and computers to more efficiently
    monitor and report incidences of crime.
  
  
  •  Increase the number of crime prevention programs offered throughout
    the zone.
  
  
  •  Increase the number of police and deputies throughout the zone.
  
  
  •  Improve communication between the public and all law enforcement
    agencies.
  
  
  •  Increase the number of convictions for crime.
  
  
  •  Increase the number of alcohol and drug programs available throughout
    the zone.
  
  
  •  Enhance and improve the number of recreational activities for
    people of all ages throughout the zone as a prevention strategy.
  
  
  •  Continue the on-going economic development efforts within the
    zone in order to create jobs as a crime prevention strategy.
  
  
  
  
  
  
  Owsley County does not have 911/Dispatch service but is committed to the
  implementation of this service within two years.
  
  
  
  In Breathitt County, 911/Dispatch service was established in 1995 and is
  funded through a $1.35 telephone tax per telephone customer per month.
  They have a 911 Coordinator who works on addressing and mapping with
  Geographic Information Systems (GIS) software. The coordinator is currently
  in the process of doing a GPS survey for more accurate location assistance.
  State Police Post #13 in Hazard, Kentucky (Perry County) does the dispatching
  for the county. The Southeast Regional 911 Board was established including
  county judges, mayors, and 911 coordinators in four counties (Breathitt,
  Leslie, Knott and Letcher). A portion of the telephone tax goes to this
  board to pay the State Police for dispatching service and to fund equipment.
  
  
  
  
  Lee County has a basic 911 dispatch service. It was established in 1990
  and is funded by a small telephone tax. They have four dispatchers and
  two county dispatchers and two part-time dispatchers. They have a 911
  Coordinator.
  
  
  
  Wolfe Countys 911/Dispatching service has been established for approximately
  eight years. It is funded through a 3% telephone tax and the Wolfe
  County Fiscal Court funds the dispatch staff positions of which there
  are four. They use Caller ID and all information is taken manually over
  the telephone.
  
  
  
  All areas are dedicated to the improvement and enhancement of 911/Dispatch
  service in order to more effectively prevent crime and lessen the amount
  of response time.
  
  
  
  In each county there is a Sheriffs Department and a local city police department.
  These agencies are primarily responsible for the crime reduction and
  prevention activities. The Kentucky State Police Post in Richmond serves
  this area with uniformed troopers. Each county has a county attorney
  who represents the county on criminal cases.
  
  
  
  In 1998, the City of Booneville received funding through the COPS Universal
  Hiring Program to create the Booneville Police Department. Currently,
  there are two police officers working within the city limits. The City
  of Booneville has since begun paying their salary. Additionally, the City
  has applied for computer equipment from the Center for Rural Development,
  special overtime pay during Labor Day weekend from the State of Kentucky,
  and overtime pay that comes down in March of every year from the state.
  
  
  
  
  The Beattyville Police Department has received grants from the Kentucky
  Justice Cabinet to increase the number of radar detectors and cameras
  in vehicles.
  
  
  
  We will work to increase the number of full-time, uniformed police officers
  throughout the zone by working with local fiscal courts and state and
  federal funding sources to secure funding for salaries and benefits.
  Often, trained law enforcement officers are hired in this area, but due
  to increased pay elsewhere, they leave, causing the expense of training
  and hiring new officers. We will also work to increase the amount of
  pay and benefits for qualified, trained, full-time police officers.
  
  
  
  
  We will increase the use of computers and technology to more effectively
  track, monitor, and report the incidence of crime. We will begin working
  to implement telecommunications services that will allow each law enforcement
  agency to connect to the National Crime Information Center (NCIC) to
  gain quicker access to information regarding suspect individuals and their
  crime records.
  
  
  
  A local county district judge was interviewed during the process to get
  his view of crime prevention efforts and what needs to occur to make
  improvements. He stated that in order to make an adequate judgment relating
  to a case, he must rely on information received from county and Commonwealth
  attorneys. Often times, in his view, county and state attorneys do not
  accept certain complaints and many times the acceptance is based on
  who a person knows. We asked him what his thoughts were on how to
  change this practice. He stated that it all boils down to personal responsibility.
  Every individual and victim has a right and responsibility to see that
  justice is served. If it is not, they should contact the state Attorney
  Generals office or the Grand Jury to report any instances of misconduct
  on the part of enforcement officials taking complaints.
  
  
  
  We will work with local board of education, local law enforcement agencies,
  local alcohol and drug abuse counseling services, and the Kentucky
  State Police to implement the DARE program throughout area schools and
  to provide other appropriate crime, alcohol and drug prevention programs.
  We will also work with these agencies to improve communication between
  the public and law enforcement organizations.
  
  
  
  We believe that if families and children had more recreational opportunities,
  there would be a lesser number of crime incidences and alcohol and
  drug use. Currently, recreational opportunities are severely limited,
  however, we are committed to enhancing, expanding, and improving these services
  as a deterrent to crime.
  
  
  
  The lack of jobs and income is another reason why crimes are committed.
  We are dedicated to the economic growth and creation of jobs and the
  improvement of services which will assist individuals in becoming more
  self-supporting therefore reducing the chances of a person committing a
  crime.
  
  
  

  ---

  Goal 3:  Increase the economic development
  activities by private entities, organizations, neighborhood organizations,
  and community groups, particularly those in the Renewal Community, including
  a commitment from such private entities to provide jobs and job training
  for, and technical, financial, or other assistance to, employers,
  employees, and residents from the Renewal Community.
  
  
  

  ---

  Actions:
  
  
  
  
  
  • Employ adequate, full-time economic development staff throughout
    the designated zone.
  
  
  •  Continue to make improvements in the local county and regional
    industrial parks within the zone.
  
  
  •  Continue to improve and expand the availability of basic services
    such as water, sewer, natural gas, and telecommunications.
  
  
  •  Work with landowners to acquire additional property for business
    recruitment.
  
  
  •  Create a dynamic marketing package to promote the zone and available
    incentives to potential business.
  
  
  • Work with the Southern Kentucky Economic Development Corporation,
    the East Kentucky Corporation, and the State of Kentucky to market
    speculative buildings located throughout the zone.
  
  
  •  Continue the speculative building program by building a speculative
    building every time one is sold.
  
  
  •  Create a local existing business program in order to provide
    assistance and services to business already located in the zone.
  
  
  •  Provide access to entrepreneurial training and small business
    development programs for individuals and businesses in the zone.
  
  
  •  Provide locally available access to basic and specific job skills
    training.
  
  
  •  Provide assistance to farmers to take advantage of financial
    and technical resources available.
  
  
  •  Assess and develop tourism resources and opportunities throughout
    the zone.
  
  
  •  Work with local, regional, state, and federal funding and financing
    sources to assist business with available financing options.
  
  
  
  
  
  
   In Owsley County, the City of Booneville recently received a grant
  from the USDA Rural Business Enterprise Program to hire a full-time
  director of the Booneville/Owsley County Industrial Authority. Although
  the Authority has been in existence for quite some time, they have never
  had the funds to hire staff, thus all administrative work was done voluntarily
  by members of the Authority.
  
  
  
  The Kentucky Cabinet for Economic Development, the East Kentucky Corporation,
  the Kentucky River Area Development District, and the Southern Kentucky
  Economic Development Corporation has been instrumental by providing
  assistance with acquiring and marketing our industrial parks and speculative
  buildings. They also bring prospects to visit our communities when they
  have an idea that our park and buildings would suit their needs. The Southern
  Kentucky Economic Development Corporation went a step further by adding
  expertise and advise during the process of interviewing and hiring
  a director in Owsley County. However, all have agreed that it is a relief
  to have a person on staff, full-time, to work hard toward the economic
  development of our county.
  
  
  
  Each county is committed to creating funding avenues to hire and maintain
  full-time economic development staff. Our counties are distressed
  county with very little business, therefore, our budget does not allow
  funds to help staff the industrial authorities. However, both county and
  city governments are actively involved in the efforts of the industrial
  authorities.
  
  
  
  Each county industrial authority and the Pine Ridge Regional Industrial
  Authority will continue working to install necessary infrastructure
  to the county and regional industrial parks including roads and water
  and sewer systems. The Booneville/Owsley County Industrial Authority is
  planning to extend natural gas lines and extend fiber optics accessibility
  to the park.
  
  
  
  The designated area will create a website for business recruitment purposes
  as well as marketing tourism related opportunities and the zone in general.
  If designated, we will especially highlight the incentive programs available
  in designated RC communities. We will work extensively with the Department
  for Housing and Urban Development and the Department for Health and Human
  Services to access resources and technical assistance available to appropriately
  market the incentives. Additionally, we will seek training opportunities
  to provide local staff with a good understanding of the incentives
  associated with the RC designation so that we can adequately promote
  our areas and attract businesses.
  
  
  
  The Booneville/Owsley County Industrial Authority will create the website
  and has purchased HomeSite software and Adobe Acrobat in order to
  create the site, including PDF files for easy downloading of information.
  
  
  
  
  The Booneville/Owsley County Industrial Authority will link to and maintain
  updated information on all regional and state economic development
  websites and publications to make sure that information on the designated
  zone is accurate and professionally presented. The Kentucky Cabinet
  for Economic Development, the Southern Economic Development Corporation,
  the East Kentucky Corporation, and the Kentucky River Area Development
  District have been instrumental by assisting us in the promotion of
  our areas for economic development by encouraging counties to help them
  keep the information up to date.
  
  
  
  Each county in the designated zone is part of the Pine Ridge Regional Industrial
  Authority. This Authority is made up of a board of directors who are
  appointed by five county judges to oversee a regional industrial park
  located in Wolfe County (within the designated zone). Representatives
  regularly attend these meetings to encourage the promotion of the region
  as a whole, not just the regional industrial park in Wolfe County.
  
  
  
  
  The Governor has been involved in the marketing efforts of the regional
  business parks located throughout eastern Kentucky. A marketing video
  has recently been created as well as a beautiful printed publication
  entitled Eastern Kentucky: The New Appalachia, featuring all regional
  industrial parks in eastern Kentucky.
  
  
  
  The 120 acre Pine Ridge Regional Industrial Park is located one mile west
  of the Campton city limits in Wolfe County. The Mountain Parkway interchange
  is south of the site via KY 1653 and KY 3039. The Mountain Parkway is
  a four-lane highway that leads to the I-64 interchange 41 miles northwest
  of site. The Bluegrass Airport in Lexington, Kentucky is 70 miles northwest
  of the site. Water and sewer service are provided by the City of Campton
  Water and Sewage Company both with 6-inch force main line. Natural
  gas is available through the Jefferson Gas Transmission Company with
  a 4-inch line 2,800 feet from the site. Electricity is provided by the
  Licking Valley Rural Electric Coop. Pine Ridge is already home to the
  Kentucky Steel Truss Company. The labor market area contains the Wood
  Utilization Center, as well as Hazard Community and Technical College,
  Alice Lloyd College, Eastern Kentucky University, and Morehead University.
  (See Attachment 5: Pine Ridge Regional Industrial Park.)
  
  
  
   Industrial parks are also located in each of the other three counties
  located within the zone. The 46.9 acre Panbowl Lake Industrial Park
  is located within the northern city limits of Jackson in Breathitt
  County. It is zoned industrial and is approximately 1.2 miles from KY15
  southwest of the site via Lakeside Drive. The Mountain Parkway is located
  22 miles north of the site via KY 15. The nearest commercial airport
  is the Bluegrass Airport in Lexington, located approximately 90 miles
  from the site. Water and sewer service is provided by the Jackson Municipal
  Sewer Company with 6-inch and 12-inch water lines serving the site
  and 8-inch gravity sewer line located 500 feet northwest of the site
  along Lakeside Drive. Natural gas is provided by the Public Gas Company
  with a 4-inch line northwest of the site along the southeast side of
  Lakeside Drive. Electricity is provided by American Electric Power.
  Breathitt County has a 40,500 square foot speculative industrial building
  located in the industrial park built in 1998. (See Attachment 6: Panbowl
  Lake Industrial Park.)
  
  
  
  The Lee County Fiscal Court owns the 27.6 acre industrial park located
  in Beattyville. The site is located two miles southwest of the southern
  city limits of Beattyville. The site is adjacent to KY 11 which provides
  access to the Mountain Parkway 22 miles from the site. The nearest commercial
  airport is the Bluegrass Airport in Lexington some 82 miles away. Water
  is provided by the Southside Water Association with a 6-inch line along
  KY 11 adjacent to the site. Sewer service is provided by the Beattyville
  Wastewater Treatment Service with an 8-inch gravity line and a 6-inch
  force main. Natural Gas is provided by the Delta Natural Gas Company with
  a 4-inch line on the south side of the highway. Electricity is provided
  by Jackson Energy Cooperative. (See Attachment 7: Lee County Industrial
  Park.)
  
  
  
  The 77.6 acre Lone Oak Industrial Park is located 1.5 miles south of the
  City of Booneville in Owsley County on KY 11 South. The nearest commercial
  airport is the Bluegrass Airport in Lexington approximately 95 miles
  away. Water and sewer services are provided by the City of Booneville
  Water and Sewer District with a 6-inch water line and an 8-inch gravity
  line serving the site. Natural gas is currently not available, however,
  plans are to seek funding to extend a gas line located approximately
  seven miles away to the park. Electricity is provided by Jackson Energy
  Cooperative. The Booneville/Owsley County Industrial Authority will also
  seek funding to provide fiber optics services to the park. (See Attachment
  8: Lone Oak Industrial Park.)
  
  
  
  The Lone Oak Industrial Park boasts two speculative industrial buildings
  available for sale or lease. The Owsley County Speculative Building
  is a 25,920 square foot facility built in 2000 with funds from EDA,
  the Local Government Economic Development Fund, and the Southern Kentucky
  Economic Development Corporation. The Lone Oak Industrial Building is
  a 10,000 square foot building built in 2000 funded through a grant from
  the Appalachian Regional Commission. In Wolfe County, a 26,500 square
  foot building is available which formerly housed the Celestica Corporation.
  
  
  
  
  The area as a whole, will host an annual Recruit the Recruiters day in
  which all regional, state, and federal officials who assist this area
  with economic development activities can come, see improvements made,
  and become updated on projects and activities that promote economic
  development. The designated zone as a whole will participate in the
  Performance Measurement System and will utilize this information as
  a marketing tool to be used in the recruitment of business. The more
  businesses see is happening in a community, the greater their desire
  will be to locate there. This area has experience in working with these
  types of measurement systems. The Breathitt and Owsley County Action
  Teams are designated Champion Communities by USDA and have participated
  in the Community Development Benchmarking System used by rural EZ/EC
  designees and Champion Communities to report progress. Additionally,
  Owsley and Breathitt Counties were designated Livable Communities during
  the last year of the Clinton/Gore Administration.
  
  
  
  The entire zone will utilize CenterNet for use in the recruitment of business
  and working with state and federal officials.
  
  
  
  A marketing piece is planned specifically relating to the RC tax incentives
  available to business. This will be created utilizing technical resources
  from HUD, HHS and USDA to creatively design a marketing strategy that
  suits our area.
  
  
  
  We will conduct a targeted business/industry analysis in order to assist
  us in identifying what types of businesses would compliment our area.
  We will utilize the University of Kentucky, the University of Louisville,
  the Kentucky River Area Development District, the Cabinet for Economic
  Development, the Department for Employment Services and others to obtain
  information already available on regional or state targeted business
  analysis. We will need help with this study for the zone if a designation
  is received because we will need to appropriately recruit the kinds of
  businesses that will fit well with our culture and create jobs that
  are complimentary to our peoples skills.
  
  
  
  Immediately upon designation, we will work with the Kentucky Cabinet for
  Economic Development, the Southern Kentucky Economic Development Corporation,
  the East Kentucky Corporation, the Kentucky River Area Development District,
  USDA and HUD to assist businesses already located in these areas to
  take advantage of available incentives as soon as the designation
  is made.
  
  
  
  We will create an Existing Industry Organization whose primary purpose
  is to meet together with businesses quarterly to discuss issues and
  needs and to update them on programs and resources available for business
  and employees. Additionally, we will create and distribute a quarterly
  newsletter to existing businesses identifying resources and providing
  up-to-date information on local, regional, state, and federal workforce
  training opportunities. We will establish an Existing Business of the
  Year award. The local, regional, and state economic development staff will
  assist in the selection of the recipient annually based on a set of criteria
  related to their business activities and involvement in the community.
  
  
  
  
  We will work with the Morehead State University Small Business Development
  Center, Lees College Campus of Hazard Community College, area vocational
  and technical centers, and others to provide businesses and staff with
  training and technical assistance and information as well as entrepreneurial
  development workshops to individuals interested in starting their own
  business.
  
  
  
  Breathitt and Owsley County Action Teams worked with the Mountain Association
  for Community Economic Development to implement a Business Incubator
  Feasibility Study to determine whether or not a business incubator
  would be successful in our area. This project was funded by a grant from
  the Appalachian Regional Commission. This project is nearing completion.
  
  
  
  
  The Owsley County Action Team, in cooperation with the Breathitt County
  Action Team, conducted a Labor Market Survey throughout four counties.
  This recently completed survey provides us with an idea of what skills
  are needed by employers in this area, what skills are currently available,
  and what kinds of training we need to provide in order to get more individuals
  skilled in jobs already available locally and regionally. This survey
  was funded by a USDA Rural Business Opportunity Grant. (See Attachment
  9: East Central Kentucky Workforce Report.)
  
  
  
  We will work with the Cabinet for Economic Development to utilize and market
  the states business finance and tax incentive programs currently available.
  The Kentucky Industrial Development Act (KIDA) is available to qualified
  companies creating at least 15 new full-time jobs and investing at least
  $100,000 in approved projects. If they qualify, they may receive state
  income tax credits up to 100 percent of annual debt service costs for
  up to ten years on land, buildings, site development, building fixtures,
  and equipment used in the project, or the company may collect a job assessment
  fee of three percent of the gross wages of each employee whose job is
  created by the approved project and who is subject to Kentucky income
  taxes.
  
  
  
  The Kentucky Rural Economic Development Act (KREDA) is available to business
  in counties whose average annual unemployment rate has exceeded the
  state average annual unemployment rate in the five proceeding calendar
  years or counties whose unemployment rate is 200% of the statewide
  unemployment rate for the preceding year. Larger tax credits are available
  for new and expanding manufacturing projects that create at least
  15 new first time jobs in Kentucky counties. The project investment
  must be at least $100,000. Companies with projects approved under KREDA
  may potentially receive state income tax credits and job assessment fees
  for up to 100 percent of annual debt service costs for up to 15 years
  on land, building, site development, building fixtures, and equipment
  used in the project.
  
  
  
  Owsley County is the only county within the designated zone that does not
  have KREDA status due to a low unemployment rate. However, we have submitted
  a proposal to Governor Paul Patton and State Senator Robert Stivers
  to change KREDA status in officially recognized distressed counties
  (there are seven counties in Kentucky listed by the U.S. General Accounting
  Office as distressed counties) based on research indicating that the
  real unemployment rate, including those discouraged workers who have
  not been looking for a job within the last four weeks to be counted,
  is much higher. They have confirmed their commitment to work with us to
  solve this issue. (See Attachment 10: KREDA Proposal - Owsley County.)
  
  
  
  
  The state offers many other programs including the Kentucky Jobs Development
  Act, the Kentucky Economic Opportunity Zone Act, the Kentucky Industrial
  Revitalization Act, and other income tax credits. Kentucky also offers
  several financial incentive programs including the Kentucky Economic
  Development Finance Authority, the Knowledge Based Economy Program, the
  Research, Innovation, and Technology Businesses Program, the Commonwealth
  Small Business Development Corporation, the Community Development Block
  Grant Program, the Linked Deposit Program, the Tax Increment Financing
  Program, and Industrial Revenue Bonds.
  
  
  
  Kentucky also offers the Bluegrass State Skills Corporation, and the Kentucky
  Investment Fund Act. They offer economic development programs such as
  the Local Government Economic Development Fund and a Regional Industrial
  Park Program, a Utility Incentive Rate Program, a Job Recruitment, Placement,
  and Training Program, the Kentucky Community and Technical College System,
  the Kentucky Information Highway, Industrial Location Assistance Program,
  and the Kentucky Tourism Development Act.
  
  
  
  Kentucky is also proud to offer the Kentucky Enterprise Zone Program, created
  in 1982, in an effort to bring new development to or to renew development
  to targeted, economically depressed areas. State and local tax incentives
  are offered to businesses located or locating in such zones, and some
  regulations are eased to make development in the area more attractive.
  A zone remains in effect for 20 years after the date of the designation.
  (See Attachment 11: Kentucky Enterprise Zone Tax Incentive Program.)
  
  
  
  
  In addition to state funding and financing sources, there are several regional
  sources including the Mountain Association for Community Economic Development,
  the Appalachian Investment Corporation, District Development Funds,
  the East Kentucky Corporation, Human/Economic Appalachian Development
  Community Loan Fund, Mountain Economic Development Fund, and the
  Southern Kentucky Economic Development Corporation.
  
  
  
  Local county governments can take advantage of the LGEDF Coal Severance
  Fund for economic development projects to promote the attraction of
  business.
  
  
  
  All areas in the zone have been concentrating on ways to improve the amount
  of tourism. This is an ideal way to stir some extra economic benefits
  while working to create business and jobs.
  
  
  
  All areas have a unique history and culture and have places in their
  communities that could serve as possible tourist attractions. If educational
  and interesting attractions were created, some tourists will steer
  themselves off the beaten path to take a look. With recent tragic events
  in our country, tourists are likely to look toward small towns for vacation
  sites.
  
  
  
  All communities within the zone are committed to participation in the State
  Department of Travel and the Southern and Eastern Kentucky Tourism Association.
  These are state and regional tourism organizations where funding can
  be obtained to create or enhance tourist attractions and events. We
  will all identify several projects within our communities, create marketing
  packages to promote them, and work to quickly get them implemented
  so that we can prepare to increase economic opportunities through an
  increase in tourism activity by next summer.
  
  
  

  ---

  Goal 4: Offer as a gift, or sell at below fair market
  value, surplus real property held by state or local governments, such
  as land, homes, and commercial or industrial structures in the Renewal
  Communities to neighborhood organizations, community development corporations,
  or private companies.
  
  
  

  ---

  Actions:
  
  
  
  
  
  •  Continue working with neighborhood and community development
    groups to improve and enhance the use of county and city-owned property
    to better serve the community.
  
  
  •  Work with state, county, and city governments to analyze property
    holdings and determine uses for any surplus property available.
  
  
  •  We will work together to create an innovative incentive plan
    using industrial property and buildings to attract business and create
    jobs.
  
  
  
  
  
  
  Our counties have a history of contributing land to neighborhood organizations,
  community development corporations, and private companies. We boast
  several community parks throughout the zone offering recreational activities
  to our people. Community organizations throughout the zone utilize
  county or city owned property and buildings to provide their services.
  
  
  
  
  For example, in Owsley County, the Booneville/Owsley County Industrial
  Authority sold property, below fair market value, to the Southfork
  Retirement Center, an assisted living facility located adjacent to
  the nursing home. Additionally, in order to attract the first business
  into the park, the Authority, as an incentive, provided land to the Image
  Entry company at no cost.
  
  
  
  We will work with state, county, and city governments to analyze property
  holdings and determine uses for any surplus property available. Based
  on the results from the analysis, we will work to implement programs
  to utilize any surplus property in a manner that will be the most beneficial
  for the governments involved.
  
  
  
  County, regional, and state economic development organizations will work
  together to create a unique, innovative incentive plan utilizing industrial
  property and speculative buildings, to encourage business and create
  jobs.
  
  
  
  
  

  RECOGNITION OF PAST EFFORTS
  

  
  
  

  RECOGNITION OF PAST EFFORTS
  

  
  The Commonwealth of Kentucky, many regional organizations, and the cities
  and counties within the designated area have been working hard to improve
  the conditions of our counties and to provide individuals with the
  necessary means to become self-sufficient. Again, there are many programs,
  too numerous to mention, that have been completed or are on-going that
  contribute to our growth. The following list provides a few examples.
  
  
  
  
  In the past few years, Kentucky has implemented many beneficial programs
  that assist communities and individuals to become self-sufficient.
  In 1996, Kentucky unveiled a new welfare reform plan, entitled the
  Kentucky Transitional Assistance Program (K-TAP), and reformed the Workers
  Compensation System.
  
  
  
  K-TAP offers incentives to employers who will train and hire welfare recipients
  and provide affordable child care. The plan also offers subsidized employment
  opportunities for qualified participants as a way to encourage a transition
  to economic independence. State government works with local communities
  to place people in workfare jobs or community service. These opportunities
  will provide valuable experience to the participants and satisfy new federal
  work requirements as well.
  
  
  
  One of the most innovative aspects of the K-TAP plan is a diversion program,
  called Family Alternatives. Under this program, participants found to
  need only temporary assistance will be able to obtain benefits just
  long enough to avert a crisis, reducing the danger of dependence and allowing
  the state to spend its limited welfare funds on families facing more
  long-term difficulties.
  
  
  
   Kentucky will attempt to place participants deemed work ready in
  unsubsidized employment within six months. Because Kentucky recognizes
  the value of education, participants previously enrolled in post-secondary
  education through the states Job Opportunities and Basic Skills (JOBS)
  program will be allowed to continue that education for up to 12 months.
  After that, they may continue only if they are engages in at least
  20 hours per week of work activity. Up to six weeks of job search will
  be counted as work-related activity.
  
  
  
  Kentucky approved a historic piece of legislation that made dramatic reforms
  in the Kentucky Workers Compensation System. Under the new legislation,
  the workers compensation system became less adversarial and more of
  an administrative system. Workers Compensation awards are based on
  medical evidence determined by the professional staff of one of the states
  two medical schools. The occupational disability will be determined by
  objective criteria that will leave little doubt about what is due the
  injured worker. The new law cuts workers compensation costs to noncoal
  industries by 11 percent and will reduce the cost to the coal industry
  by an estimated 22 percent. Workers will save about $30 million in
  unnecessary medical and legal bills, but will still be able to go to
  their own doctors and hire lawyers, if they choose to do so.
  
  
  
  In 1997, the Office of Coal County Development was created to assist coal
  producing counties to diversify their economies beyond coal. The new
  office is attached to the Secretarys Office in the Kentucky Cabinet
  for Economic Development, and oversees the Local Government Economic
  Development Program (LGEDP).
  
  
  
  Coal producing counties first started receiving a share of coal severance
  tax receipts in 1992 to help them diversity their local economies beyond
  coal. At that time, the Local Government Economic Development Fund
  (LGEDF) was created to provide grants of coal severance tax revenues to
  make counties attractive to new manufacturing and service industries,
  as well as to help existing businesses expand. Each coal producing
  county is allotted a portion of the LGEDF money for use exclusively
  in that county, and a portion is set aside for multi-county or regional
  projects. Each county within the designated zone has utilized LGEDF grants
  to create industrial park and construct infrastructure. A portion of
  this money is set aside for business training incentives. Each county
  used a portion of their LGEDF funds to form the Pine Ridge Regional Industrial
  Authority and purchase the industrial park located in the City of Campton
  in Wolfe County within the zone. (See Attachment 12: Individual County
  LGEDF Spreadsheets.)
  
  
  
  The state also restructured the Department for Local Government to make
  it more accessible and to lessen the red tape. Support services will
  increase technology to eliminate much of the paperwork now required.
  Local officials will be able to use the Internet to file grant and loan
  applications.
  
  
  
  Also during 1997, the state lowered vehicle property taxes. The Kentucky
  Revenue Cabinet began using the trade-in value of cars and trucks for
  assessing property taxes, effective January 1, 1998.
  
  
  
  The state hired the first Chief Information Officer for the state. The
  EMPOWER Kentucky initiative identified a need for a strategic approach
  to the planning and implementation of technology throughout state
  government. This new officer directs and implements the Strategic Information
  Technology Plan to insure coordination of the states technology efforts.
  
  
  
  
  In 1998, Kentucky became the first state to create its own commission under
  the recommendations of the National Commission on Small Farms. The commission
  will comprise a group of farmers from every corner of Kentucky representing
  all sectors of the agricultural economy. They will examine the issues
  confronting Kentuckys family farms and make recommendations to the
  Governor, the legislature, and the Kentucky Congressional delegation on
  policies and programs for the future of Kentuckys family farms.
  
  
  
  Kentucky also formed a task force to analyze Kentuckys adult education
  system. The Task Force on Adult Education is made up of six members
  appointed by the Senate, six appointed by the House of Representatives,
  and six by the governor. The governor chairs the task force. They develop
  recommendations and an implementation plan for raising the literacy
  level and educational attainment of Kentuckys adults who have not graduated
  from high school or who have poor literacy skills.
  
  
  
  Senate Bill 21 was passed, enabling high school students who maintain at
  least a 2.5 grade point average to earn state scholarship money to Kentucky
  institutions of postsecondary education. This is an added incentive
  for young people to pursue their education, and the grants help them devote
  those four years of college to learning. House Bill 469 guarantees that
  teachers will get an automatic cost of living adjustment in their wages
  to account for inflation. It is not a raise. Kentucky is ensuring that
  teachers will maintain their purchasing power or will not take a pay cut.
  Finally, the Kentucky Childrens Health Insurance Program (K-CHIP), Senate
  Bill 128, was passed which provides $13 million in state funds to secure
  $50 million in federal aid for children of the working poor to access
  health benefit coverage. House Bill 142 was passed giving the courts and
  social workers broader abilities to intervene in abusive homes. Under
  the old law, emergency removal of a child from a family required proof
  of imminent danger. Now the system can also act to protect the child
  when there is evidence of repeated physical injury or emotional harm, and
  in situations where the child is in immediate danger because the parent
  has failed to act. The law also sets new grounds for termination of
  parental rights and expedites the procedures for terminating those rights
  by setting time limits for court action.
  
  
  
  Kentucky was the first in the nation when, in 1998, they linked all victim
  advocates by computer. The new system, called V-Net, created a computer
  network to link every victim advocate in Kentucky, including advocates
  in prosecutors offices, rape crisis centers, spouse abuse shelters and
  child protection agencies. Through this network advocates are able, for
  the first, time to directly access Kentuckys victim notification system
  to locate where a dangerous offender is incarcerated or to register
  a victim to be notified. V-net also provides critically needed support
  to advocates by giving them immediate access to information with which
  they can assist victims information like where the nearest protective
  shelter is locates; how Kentucky law can protect a child; where a forensic
  rape exam can be conducted; and much more.
  
  
  
  In 1999, Kentucky became one of the first states to offer an Internet service
  specifically designed to assist our business entrepreneurs. The One-Stop
  Business Licensing Program is designed to greatly simplify the maze
  of regulatory red tape all new business owners experience. It allows
  entrepreneurs to go on-line to determine which of over 600 state licenses
  or permits are needed for their particular business. The service immediately
  identifies the specific state licenses required for each of over 1,800
  business types.
  
  
  
  The Cabinet for Workforce Development established an Education Pays Scholarship
  for customers of the cabinets wide range of employment and training programs
  and services. To be eligible, applicants must be a customer of at least
  one of the cabinets services, which includes adult education, vocational
  rehabilitation programs, unemployment insurance, job search, the Job Training
  Partnership Act, or secondary technical education, among others. Applicants
  must also be Kentucky residents and provide proof of enrollment in
  a postsecondary educational institution.
  
  
  
   The Kentucky Resource Directory, the first of its kind in the country,
  is online and just a click of the mouse away. The directory is an
  Internet database of some forty-five thousand services available
  in the state, at the federal, state, local, and private level. Whether
  you are looking for a job or looking for a summer camp for kids, residents
  can locate the information online. This Empower Kentucky initiative
  is designed to bring together people and resources in the most efficient
  way. Kentuckys website is the only one in the country that offers private
  as well as public agency information from an estimated fourteen-thousand
  providers. Individuals can find phone numbers, detailed maps, even
  photographs of the buildings where the service is located. The information
  was first compiled by the Kentucky Council of Area Development Districts,
  beginning in 1997, and Kentuckys Cabinets for Families and Children,
  Health Services, Workforce Development, Department of Information
  Systems, and Jefferson Countys Community Resource Network compiled
  additional electronic data.
  
  
  
  Kentuckys food stamp program switched from paper to debit cards to reduce
  fraud, save time, and reduce the stigma of using food stamps. The pilot
  project started in Anderson, Woodford, Fayette, Franklin, and Shelby
  counties. The program was then implemented throughout the state. The
  cabinet will save up to a million dollars per year in reduced postage
  and administrative costs previously spent on sending stamps every month.
  Fraud is reduced because the specially coded cards will not allow
  users to buy non-food items or get change to spend on ineligible items.
  And, theft will be less appealing because the cards require the use of
  a personal identification number.
  
  
  
  Kentucky high school students can go online with Internet access to advanced
  courses in foreign languages, math, and science. The Kentucky Virtual
  High School is the first project of its kind in the world. The Virtual
  High School gives students everywhere in the state the opportunity to take
  challenging advanced courses not available at their local high school.
  
  
  
  
  The KVHS has two corporate partnerships. One with Class.com, Inc., to use
  secondary courses developed by the Division of Continuing Studies at
  the University of Nebraska with a $17 million Star Schools Grant from
  the U.S. Department of Education. The other partnership is with eCollege.com,
  which creates Internet education solutions, to bring online education to
  the classroom and to the distance-learning student. The state has also
  implemented the Kentucky Virtual Library and the Kentucky Virtual Adult
  Education System.
  
  
  
  In 2000, House Bill 706 was passed creating a multi-faceted program to
  provide for the education and healthy development of Kentuckys youngest
  citizens. The KIDS NOW initiative is a historic first step toward the
  responsibility we have to helping families and communities make sure that
  each and every child reaches their full potential in the first few year
  of life.
  
  
  
  The Kentucky Innovations Commission was created by the enactment of House
  Bill 572 and will be the primary advisor to state policymakers on issues
  related to Kentuckys competitiveness in the new economy. The New Economy
  Initiative proposes several steps over the biennium to further develop
  the knowledge-based Kentucky. In order to be a player in the fast-moving,
  global, hightech economy of the 21st century, we will have to improve
  the way we educate our people, train our workers, and grow our businesses.
  
  
  
  
  Kentucky Access was created to offer attractive savings and health insurance
  choices for individuals with high-cost medical conditions. The program
  has already created a business environment where two insurers have returned
  to Kentucky, offering competitive choices for the entire individual
  market of over 100,000 farm families, self-employed, and working Kentuckians
  who must buy their own health insurance coverage.
  
  
  
  This year has been a productive year in the State of Kentucky. In an effort
  to attack the proliferation of Kentuckys newest drug of choice, an Oxycontin
  Task Force was created to combat the use and contain the spreading abuse
  of the prescription drug. Now more popular than marijuana and cocain,
  the illegal use of Oxycontin, particularly in eastern Kentucky, has reached
  nearly epidemic proportions. In eastern Kentucky alone, more than 30
  people have died in the last year. In addition to the physical danger
  of the drug, its cost, popularity, and addictive nature has caused a drastic
  increase in property crime, home invasion, assault, and robberies by
  addicts attempting to supply their habit.
  
  
  
  The Governor signed an Executive Order creating the Certified Clean County
  Program. The state will provide existing resources as an incentive to
  help counties clean up their illegal dumps and adopt a mandatory solid
  waste collection service to keep their county clean and dump free. Under
  the program, the state will reimburse eligible counties for 75% of the
  direct expense of cleaning up illegal dumps.
  
  
  
  The Natural Resources and Environmental Protection Cabinet will provide
  assistance to participating counties in identifying illegal dumps and
  estimating the cost of cleaning them up. The Cabinet will also provide
  staff to monitor and assist in the clean up effort and inspect and re-certify
  the county as dump free on an annual basis. Once all dumps are cleaned
  up, the county will be designated a Certified Clean County and the state
  will pay for, install, and maintain a Certified Clean County sign
  at each entrance to the county. These counties will also gain extra points
  when applying for grants and get priority for funds from the Division
  of Conservation State Cost Share Program and the Waste Tire Trust Fund.
  To be eligible, counties must mandate a curbside solid waste collection
  service requiring all residents and businesses to use the service and pay
  for it.
  
  
  
  Citing the need to maintain and maximize Kentuckys low-cost energy advantage,
  an Executive Order was signed creating the Kentucky State Energy Policy
  Advisory Board to develop a coordinated statewide energy policy. The
  Board will study energy markets throughout the country and internationally
  and devise a strategy for maximizing Kentuckys low-cost advantages in
  supplying affordable and reliable power. The Board will also coordinate
  energy related programs throughout the state and recommend to the Governor
  and General Assembly programs and strategies to improve energy related
  efforts.
  
  
  
  Governor Patton announced the creation, by Executive Order, of a bipartisan,
  35-member Smart Growth Task Force to study growth and development issues
  in the Commonwealth. This task force will study how a more strategic
  approach to growth management can enhance Kentuckys future, working
  to elevate smart growth as a public policy issue statewide and conducting
  a thorough review of Kentucky statutes, regulations, and programs that
  relate to growth. They will also identify possible incentives to assist
  our local governments in instituting model smart growth principles
  within their government operations, as well as looking at the smart growth
  planning of other states. The task force will issue a report next year
  that will be used to set a framework for the incorporation of smart
  growth principles within state and local government.
  
  
  
  In August, the Governor released the names and star ratings for 77 childcare
  programs that voluntarily participated in a pilot project for Kentuckys
  new quality rating system for childcare programs. The rating system,
  called STARS for KIDS NOW, is part of Kentuckys early childhood initiative
  signed into law last year to help ensure positive outcomes for Kentuckys
  young children. These childcare programs were rated for adherence to a
  four-tier set of standards that are based on what research shows to
  be good practices for children. Lower staff to child ratios, greater levels
  of staff education and training, increased opportunities for family involvement,
  and age-appropriate curriculum planning are all part of the rating
  criteria. Childcare providers in two of the counties in the identified
  RC zone earned the first STAR award this year. In Breathitt County, the
  Montessori House for Children and Miller II and Miller III earned the
  award on levels two and three. In Owsley County, the Owsley County
  Early Childhood/Head Start earned the award.
  
  
  
  In addition to the many state projects, the local cities and counties throughout
  the identified zone have been working hard to prepare our area for growth.
  To be brief, we completed program surveys on projects implemented during
  the last eight years to meet the outlined goals.
  
  
  
  Breathitt County currently has three bridges that are being funded by the
  State of Kentucky. Two are presently under contract to be built and one
  is in the design stage. Many county roads have been re-built in an
  effort to make them easier to maintain.
  
  
  
  Breathitt county, this year, established its own water district board in
  an effort to expand water services throughout the county. Twenty projects
  have been identified under the plan presently submitted to the state
  through the Breathitt County Long Range Water Supply Plan. The first project
  proposed is the Highland Turner line, which is now under design by the
  districts engineers.
  
  
  
   Breathitt County is also working through the Transportation Safety
  Committee of the Kentucky River Area Development District to devise
  a plan to be submitted to the Kentucky Department of Transportation
  for the improvement and upgrading of the road system in Breathitt County.
  
  
  
  
  The Jefferson Hotel Skills Center has been funded and is in the process
  of major renovation work at the old hotel. The county utilized many
  funding sources, including the LGEDF coal severance funds, to finance
  the creation of this center.
  
  
  
  In an effort to clean up streams and rivers in the county, Breathitt has
  begun working with the Corps of Engineers in what is known locally as
  the Hardshell Caney Sewer Project which is an effort to find a solution
  to small communities who do not have access to city sewer systems and
  do not have a working septic system.
  
  
  
  Breathitt County purchased 32 acres of property to create the Pan Bowl
  Lake Industrial Park and finished construction on a 40,000 square foot
  speculative industrial building in its recently developed industrial
  park. They are members of the Pine Ridge Regional Industrial Authority
  and the Coal Fields Regional Industrial Authority in an effort to attract
  business.
  
  
  
  The City of Jackson extended sewer service along Kentucky Highway 15 to
  allow for industry expansion and to serve the Kentucky Community Care
  complex. They also funded an entire water system to replace the Highland
  Avenue Water Tank which had been torn down approximately seven years
  ago. They added a new tank to serve the Kings Ridge area of town due to
  low water pressure. They also replaced all the valves at the Quicksand
  Tank. To ensure water quality, the City of Jackson conducted a water
  quality analysis for 183 residents. They also implemented a water treatment
  plan project in March of this year that, upon completion, will provide water
  and sewer service to 2,200 customers.
  
  
  
  The City of Jackson will soon start a renovation project at City Hall including
  a new town hall meeting room. In April, they also implemented a Kentucky
  Renaissance program to completely renovate the downtown area.
  
  
  
  The Lee County Industrial Park was created in 1998 consisting of the development
  of 28.6 acres located on state Highway 11 approximately three miles south
  of Beattyville. The major elements of the project included site clearing
  and grading and the construction of 11,040 linear feet of 8" water
  main, 10,800 linear feet of 8" gravity sewer lines, 4,500 linear feet of
  6" force main, and four sewage pump stations. In 2000, the Beattyville
  Water Storage Tank was built to store 300,000 gallons of water. Lee
  County has also been in the process of a major sewer expansion.
  
  
  
  Additionally, the City of Beattyville Police Department and the Lee County
  Sheriffs Department have received COPS grants within the last year to
  add one full-time deputy position, radar and cameras in city police
  cars, and a grant from the Center for Rural Development to improve technology
  use in the Sheriffs Department by providing laptop computers to each deputy
  and other technology equipment.
  
  
  
  In 1995, the Owsley County Fiscal Court and the Booneville/Owsley County
  Industrial Authority purchased 91.829 acres of industrial property.
  These funds included site acquisition, site appraisal, and site development.
  In 2000, they developed a master plan for the park, constructed additional
  access roads, and built signage for the park. Also in 2000, funding
  was secured to install infrastructure in the park including a 300,000
  gallon elevated water tank, 3,800 feet of 8" water main, and a pump
  station for the additional acres.
  
  
  
  An additional 229.5 acres of land was purchased by the Booneville/Owsley
  County Industrial authority to create an emergency/alternative water
  supply for the Owsley County area. They are researching the feasibility
  of creating a golf course on that property in order to attract tourism.
  
  
  
  
  In 2000, the Southern Kentucky Economic Development Corporation, with funds
  from EDA, assisted Owsley County by building a 25,000 speculative industrial
  building in the industrial park. SKEDC assists the Authority with marketing
  the building. Another 10,000 square foot industrial building was built
  with ARC funds and LGEDF funds.
  
  
  
  Other projects in Owsley County and the City of Booneville that have been
  completed or are ongoing include water line extension, the construction
  of a wastewater treatment facility, sewer extension, and water tanks
  and lines in two locations. The City of Booneville created the City of
  Booneville Police Department including two officers, 2 bullet proof vests,
  a police car video system, and police weapons. They also received a
  grant to purchase a fire truck for the Booneville Volunteer Fire Department.
  The County also received a grant to purchase an ambulance for Allens Ambulance
  Service.
  
  
  
  As a result of Owsley Countys participation as a Champion Community and
  a Livable Community, a grant was received from USDA to hire a full-time
  economic developer. They also received an ARC Flex-E grant for technical
  strategic planning.
  
  
  
  Owsley County has also submitted its twenty-year water and sewer implementation
  plan to the state and is in the process of a sewer extension project
  which will include the industrial park.
  
  
  
  Breathitt, Lee, Owsley, and Wolfe Counties are members of the Pine Ridge
  Regional Industrial Authority. In 2000, each county utilized a portion
  of their LGEDF funds to purchase a 125 acre regional business park.
  This project included the extension of water and sewer service to the park
  and site development. Fifteen acres was donated to the regional industrial
  authority by the Wolfe County Industrial Authority. Kentucky Steel
  Truss has located in the park and created approximately 25 jobs. This
  is the only industrial park within the designated zone that is located
  adjacent to a four-laned highway, the Mountain Parkway, which provides
  access to I-64 leading to I-75 in Lexington.
  
  
  
  Copies of the project surveys are attached along with state press releases
  describing state programs implemented in the last few years. All counties
  and the State of Kentucky have plans for other projects. All counties
  will be working to implement their twenty year water and sewer plans and
  many county and state roads have been upgraded or are in the planning
  process of renovations. (See Attachment 13: Renewal Communities Project
  Surveys.)
  
  
  
  Additionally, the state and each county within the zone have on-going projects
  and programs aimed at the economic improvement of the state and our communities
  including the LGEDF Coal Severance program, state financial , tax,
  and training incentive programs, childcare, K-TAP, KCHIP, adult education
  programs, social service programs, and many more.
  
  
  
  We are all dedicated to continuing our efforts to build economically viable,
  self-sufficient communities that provide services needed by individuals
  to assist them in becoming self-supporting. As one city mayor stated,
  We have planned, and planned, and planned! Now is the time to start
  doing. If an RC designation was awarded to us, we are confident and prepared
  to take full advantage of all the benefits and to make sure that our
  people take advantage of all the opportunities that become available
  to become and remain employed.
  
  
  
  
  

  Timeline

  
  
  

  TIMELINE

  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  

  ---

  
  

  
  
  PERFORMANCE MEASURES AND EVALUATION

  
  
  

   PERFORMANCE MEASURES
  AND EVALUATION

  
   As with any successful program, we are committed to making sure that
  every individual has an opportunity to benefit from the RC designation.
  With that in mind, we have set performance measures to work toward in
  order to evaluate our progress and to provide information to the public
  concerning the numbers of people being served and the kinds of services
  they are receiving. We will not only use this as an evaluation method,
  but as a motivational method to encourage others to take advantage of
  the opportunities.
  
  
  
  The following tables describe our performance measures for each goal and
  action.
  
  
  

  ---

  Goal 1: To increase the level and efficiency of
  local services within the Renewal Community, such as services for residents
  funded through the Federal Temporary Assistance for Needy Families
  program and related Federal programs including, for example, job support
  services, child care and after school care for children of working residents,
  employment training, transportation services, and other services that
  help residents become economically self-sufficient.
  

  ---

  
  

  Performance Measures:

  
  
  
  
  
  • One hundred individuals will complete the Steps to Success Welfare-to-Work
    Training Program offered through the Owsley County Action Team.
  
  
  • One low-income individual will benefit from a Vista position at the
    Owsley County Action Team coordinating computer lab and CenterNet programs.
  
  
  •  One hundred individuals will benefit from workshops sponsored
    through the Owsley County Action Team technology center.
  
  
  • Twenty-five different training programs will be offered by video
    conference through the use of CenterNet.
  
  
  • Twenty individuals will utilize computers for home-based work in
    the data entry profession.
  
  
  • Fifteen regularly scheduled community college or university courses
    will be offered by video conference throughout the zone utilizing CenterNet.
    
  
  
  • Ten different training opportunities will be hosted at the Jefferson
    Hotel Skills Center after renovations are complete.
  
  
  • One staff person will be hired to coordinate the Fund for Excellence
    Program in Owsley County.
  
  
  • Participation by students in the Fund for Excellence will increase
    by 20%.
  
  
  • The number of students graduating from high school will increase
    by 20%.
  
  
  • One Job Skills Training Resource Directory will be created. C
    Enrollment in childcare will increase by 15%.
  
  
  • Quarterly Agricultural Diversification Workshops will be conducted
    throughout the zone.
  
  
  • One hundred farmers and other individuals will complete Agricultural
    Diversification Workshops. C Housing opportunities will increase
    by 25%.
  
  
  • Five hundred individuals will utilize the laptop lending program
    for skill training.
  
  
  • Ten medical clinics will become involved in after-hours and weekend
    non-emergency medical care programs.
  
  
  • Five hundred individuals will benefit from the availability of after-hours
    and weekend nonemergency medical care.
  
  
  • All CenterNet facilities throughout the zone will acquire medical
    equipment for use in specialty medical appointments by video-conference.
  
  
  • Fifty individuals will benefit from medical appointments by video
    conference.
  
  
  • Water and sewer services will be expanded to serve 20% more people
    every two years.
  
  
  • Five new fire departments will be created throughout the zone.
    
  
  
  
  
  
  

  ---

  Goal 2:
  
  
  
  
  
  • Increase crime reduction strategies, such as crime prevention, including
    the provision of crime prevention services by non-governmental entities.
    Performance Measures:
  
  
  • Emergency 911/Dispatch will become available throughout Owsley County
    and will be expanded and improved in Breathitt, Lee, and Wolfe counties.
    Twelve full-time, uniformed police officer positions will become available
    throughout the zone. 
  
  
  • Each police department throughout the zone will utilize state-of-the-art
    technology, including the NCIC system.
  
  
  • Ten arrests will occur due to the availability of information through
    the NCIC system.
  
  
  • The DARE program will be incorporated in every school within the
    zone.
  
  
  • Twenty new recreational programs will be created throughout the zone.
  
  
  
  
  
  

  ---

  Goal 3:
  
  Increase the economic development activities by private entities, organizations,
  neighborhood organizations, and community groups, particularly those
  in the Renewal Community, including a commitment from such private entities
  to provide jobs and job training for, and technical, financial, or other
  assistance to, employers, employees, and residents from the Renewal
  Community.
  
  
  

  ---

  Performance Measures:
  
  
  
  
  
  • At least three full-time economic developer positions will remain
    funded throughout the zone.
  
  
  • A website will be created for business recruitment.
  
  
  • Fifty companies will seek further contact based on information received
    from the website.
  
  
  • Twenty-five new businesses will be attracted to the zone.
  
  
  • One thousand jobs will be created.
  
  
  • Two speculative industrial buildings will be sold or leased.
  
  
  • Three speculative industrial buildings will be constructed.
  
  
  • Annual Recruit the Recruiters days will be held within the zone.
  
  
  • CenterNet will be used twenty-five times for business recruitment
    purposes.
  
  
  • Five businesses already located throughout the zone will take advantage
    of incentives immediately.
  
  
  • Quarterly entrepreneurial and small business training programs will
    be provided throughout the zone.
  
  
  • Two hundred individuals will attend entrepreneurial and small business
    training programs throughout the zone.
  
  
  • KREDA status will be re-instated in distressed counties in Kentucky,
    including Owsley County.
  
  
  • Ten new tourism related opportunities will be created.
  
  
  • Tourism will cause an increase of 10% in county and city budgets.
    
  
  
  
  
  
  

  ---

  Goal 4:
  
  Offer as a gift, or sell at below fair market value, surplus real property
  held by state or local governments, such as land, homes, and commercial
  or industrial structures in the Renewal Communities to neighborhood
  organizations, community development corporations, or private companies.
  

  ---

  Performance Measures:
  
  
  
  
  
  • Ten pieces of industrial property will be sold at below fair market
    value based on criteria set by the industrial authorities according
    to the amount invested and the number of jobs created.
  
  
  • Five site preparation grants will be awarded as a local incentive.
    
  
  
  
  
  
  
  All of the main participants in the implementation of the strategic plan
  have experience with problems and obstacles that occur in the implementation
  of any project. What is important is that they learn from their mistakes
  and find solutions to make things better. We are dedicated to identifying
  all problems, outlining the lessons learned from the problem, and using
  that list to make changes that alleviate those problems and enhance the
  strategic plan. We are also dedicated to making the public aware of
  the successes that will occur as a motivational method of involving even
  more people.
  
  
  
  We will conduct a quarterly survey among organizations involved in the
  work to identify any problems and obstacles. This survey will include
  a section to list the lessons learned in overcoming these problems.
  This list will be used to create a lessons learned publication that other
  groups and areas outside the zone could utilize to keep themselves from
  going through the same mistakes. This will also be used in the evaluation
  of our programs.
  
  
  
  These survey results, and the input received by the public, will be used
  to make revisions to the implementation methods and procedures. If changes
  need to occur, we will outline the method of change and the procedures
  to be taken to make that change occur.
  
  
  
  Although the CoRA will be making recommendations for change in the implementation
  methods and procedures, before these changes are finalized, they will
  be brought before the public through local newspapers and public service
  announcements on local radio and television stations for a period of
  two weeks. After two weeks, if no negative comments on the change were received
  by the public, the changes will be implemented.
  
  
  
  It is the desire of all of us that the public have input into every aspect
  of this designation and its implementation. We have committed to settle
  for nothing less. Every person counts and their input is considered
  valuable. Not only does this give the public the assurance that they are
  going to be included in the process, it also shows a deep respect for
  individual people, not just the "community."
  
  
  
  We will create and approve a spreadsheet for use in tracking performance
  measure progress. Each organization involved in the implementation
  of any projects related to the designation will appoint one staff person
  to complete the spreadsheet listing any progress and successes. Additionally,
  these organizations will provide information on any outside funding
  received that is not directly related to the designation.
  
  
  
  This information will be gathered by the CoRA. They will compile this information
  and provide a complete update for input into the Performance Measurement
  System.
  
  
  
  Semi-annually, we will conduct public meetings to review progress in order
  to get the communities 59 idea of how we are doing and whether or
  not we need to change focus. As projects are on-going, monthly we will
  publish press releases documenting the progress and how many individuals
  are being served.
  
  
  
  Owsley and Breathitt Counties, as Champion Communities, have utilized the
  USDA Community Development Benchmark Management System for the past two
  years as part of the requirements for this designation. We have experience
  in tracking performance through a variety of projects implemented during
  the course of this designation. Additionally, required quarterly reports
  to private foundations have been completed on a number of projects in
  the past. (See Attachment 14: Breathitt and Owsley County Champion Community
  Benchmark System Report.)
  
  
  
  The CoRA will be the ultimate responsible party for making revisions to
  the implementation methods and procedures. If changes need to occur,
  the CoRA will outline the method of change and the procedures to be
  taken to make that change occur. Before these changes are finalized, they
  will be brought before the public through local newspapers and public
  service announcements on local radio and television stations for a period
  of two weeks. After two weeks, if no negative comments on the change
  were received by the public, the changes will be implemented.
  
  
  
  If the specified change requires a more immediate response, the CoRA will
  either make the emergency decision or will publish these events outlining
  the need to provide responses more quickly.
  
  
  
  Throughout this process, the most obvious issue identified was that individuals
  want to know what is happening in their communities. This historical
  lack of information is what has caused the serious negative perception
  and image problems associated with rural areas. As committed as we were
  in involving our entire communities in the planning process, we are as
  committed to making sure that from now on, our people are aware of what
  leaders are doing to improve their quality of life and economic opportunities
  and what benefits are available to them.
  
  
  
  Throughout this process we stressed that if a persons needs are not being
  met, we want them to come and ask us why. They have a right to know why
  they are not being served.
  
  
  
  Immediately, we will create a visually appealing document which will be
  presented to the fiscal courts and city councils and published or inserted
  in every area newspaper so that community individuals have an opportunity
  to learn about the benefits of the RC designation.
  
  
  
  We will utilize available technology to create a website featuring detailed
  and comprehensive information on services available. Technology has become
  an important part of our rural communities. In order to bridge the
  digital divide that exists in our communities, public computer programs
  have been implemented which provide our people with access to the Internet
  and electronic communication. We will enhance these programs and expand
  the availability of public computer technology so that more individuals
  have access to information.
  
  
  
  We will encourage residents with e-mail addresses to provide this information
  in order to be included in a community listserv which will provide
  information and updates on services, training 60 and job opportunities,
  and workshops currently available.
  
  
  
  For those who do not have access to computers, monthly updates will be
  published in all area newspapers and disseminated through agencies such
  as the Cabinet for Families and Children and other non-profit groups
  offering services to community individuals.
  
  
  
  Annually, we will host a large public meeting to evaluate progress during
  the year.
  

  ---

  Renewal Community and Empowerment Zone ApplicantsHHS Administration for Children and Families   Posted: May 14, 2002
  HHS Administration for Children and Families

  Renewal Community and Empowerment Zone Applicants

  The U.S. Department of Health and Human Services is pleased to offer support and assistance to localities for adding a human services and welfare-to-work perspective to their Empowerment Zone (EZ) or Renewal Community (RC) applications.

  The EZ and RC programs are good opportunities for collaborative work involving economic development agencies and human services organizations, particularly agencies that administer the federal Temporary Assistance for Needy Families (TANF) program. We encourage local leaders to use the EZ and RC planning process to reach out to human services agencies, work with them to create strategies for enhancing services for needy residents, and incorporate those strategies into their EZ strategic plans and RC course of action documents
  

  ---

  Renewal Community Information Sheet: City of Rochester   Posted: May 12, 2002
  

  Renewal Community Information Sheet

  By focusing on marshaling the support and commitments of key players in State and local governments and emphasizing forming alliances with businesses and local community-based organizations, the Renewal Community Initiative offers Federal tax breaks and provides a framework for State and local governments to offer incentives and other benefits. The initiative does not provide Federal funds.

  By encouraging job development and retention, the RC initiative helps residents gain employment, succeed in their jobs, and become economically self-sufficient. The increase in business activity that results from these actions will provide economic growth and benefits to the RC and the surrounding community. The RC initiative creates a structure that fosters partnerships. Federal, State and local governments, community organizations, and businesses all play a role.

  State and local governments have developed and committed to and will now implement a Course of Action that becomes the framework of the local RC initiative.
  

  ---

  RC Tax Incentives Chart from the City of Memphis   Posted: May 12, 2002
  A table of incentives, credits, and forbearances offered in Renewal Communities.
  
  

  ---

  IRS RC Publications: 954, 8844, 4562 & Related Tax Incentives (City of Minneapolis)   Posted: May 10, 2002
  

  Tax Incentive Guide : Tax Incentive Guide for Businesses in the Renewal Communities, Empowerment Zones and Enterprise Communities

  IRS Publication 954: Tax Incentives for Empowerment Zones and Other Distressed Communities.

  IRS Form 8844: Empowerment Zone Employment Credit

  IRS Form 4562 for Addtional Expensing

  Empowerment Zone Related Tax Incentives (City of Minneapolis, MN)
  

  ---

  Tucson Empowerment Zones   Posted: May 10, 2002
  
  
  Tucson Empowerment Zones

  
  
  The Empowerment Zone is a collaborative effort between the City of Tucson, Pima County and the City of South Tucson. Working together to address the issues of Downtown and the inner-city.
  

  ---

  The Lackawanna Empire Zone (LEZ) is a Renewal Community   Posted: May 10, 2002
  The Lackawanna Empire Zone (LEZ) offers tax incentives, abatements, credits and benefits for businesses that expand into or start-up in a designated area in the First Ward of the City of Lackawanna in order to create jobs and advance or spur community growth and investment. Lackawanna, an inland ocean port located along the shores of Lake Erie, and bordering the City of Buffalo to the south offers utility rate discounts, duty-free foreign trade zone, customized and subsidized job training programs, access to attractive financing programs, quality infrastructure/fiber optics, and rail access all within ten minutes from Interstate Highway 90 and the International Peace Bridge connecting the United States and Canada
  

  ---

  Rules and Regulations: Designation of Round III Urban Empowerment Zones and Renewal Communities   Posted: May 10, 2002
  Rules and Regulations: Designation of Round III Urban Empowerment Zones and Renewal Communities Page 2 35850 Federal Register / Vol. 66, No. 131 / Monday, July 9, 2001 / Rules and Regulations DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT 24 CFR Parts 598 and 599 [Docket No. FR­4663­I­01] RIN 2506­AC09 Designation of Round III Urban Empowerment Zones and Renewal Communities

  AGENCY : Office of the Assistant Secretary for Community Planning and Development, HUD. ACTION : Interim rule. SUMMARY : This interim rule governs the designation of Round III Urban Empowerment Zones (EZs) and Renewal Communities (RCs) nominated by States and local governments. The designation of an area as an EZ or an RC provides special Federal income tax treatment as an incentive for businesses to locate within the area. This rule lays the foundation for designations to be made on the basis of applications submitted in response to the Notice Inviting Applications published elsewhere in this issue of the Federal Register .

  
  

  ---

  CMPDD designated as CoRA   Posted: May 10, 2002
  The Central Mississippi Planning and Development District (CMPDD) has been designated as the Coordinating Responsible Authority (CoRA) for the RC area. The purpose of the CoRA is to implement and maximize the federal, state and local benefits made available in the Mississippi Renewal Community Area. CMPDD will be developing the tax incentives utilization plan to develop and expand businesses in the Renewal Community through available federal state and local incentives. The state, working through MDA and the CoRA will ensure that the tax incentive utilization plan is developed with participation of the Renewal Community residents and community organizations. One of the CoRA's main responsibilities will be to notify businesses, as early as possible, of the benefits they will garner by taking advantage of these available valuable incentives.
  

  ---

  MILWAUKEE'S RENEWAL COMMUNITY Where Opportunities Abound   Posted: May 10, 2002
  MILWAUKEE'S RENEWAL COMMUNITY Where Opportunities Abound

  COURSE OF ACTION EXECUTIVE SUMMARY City of Milwaukee Renewal Community Application Page 1 Executive Summary Page 2 SIGNATURES AND LETTERS OF SUPPORT As the nominating government entities and representatives of community organizations, business associations, and partners in economic development, we recognize the importance of having tools available to us as we strive to revitalize Milwaukee's neighborhoods. The tools offered through the Renewal Community program would be a critical component to spur economic development in Milwaukee's most distressed communities. We sign to demonstrate our commitment to this Course of Action, which outlines our collective past and future economic development strategies and efforts.

  ---

  Renewal Community and Round III Empowerment Zone Technical Assistance Workshops   Posted: May 10, 2002
  This is an HTML version of a HUD Powerpoint Presentation from 2001 (I think).

  Renewal Community Workshop Presenters:
  
  Linda Schakel,
  John Haines, and
  Phil Graham
  

  
  202–708–6339
  

  
  www.hud.gov/offices/cpd/ezec

  
  
  
  

  Renewal Community
  and Round III
  Empowerment Zone
  Technical Assistance Workshops

  
  
  
  

  Day One:

  Renewal Communities

  Day Two:

  Round III Empowerment Zones
  
  

  
  
  
  
  

  “Of course, I’m applying for a Round III Empowerment Zone.”

  
  
  
  

  Round I E-Zones & Enterprise Communities

  Funding:

  6 Urban EZs received $100,000 million each

  65 ECs received $3 million each
  

  Round II Empowerment Zones

  Funding:

  15 EZs received $11 million each
  

  Round III Empowerment Zones

  7 Urban and 2 Rural EZs : $22 billion in Tax Incentives will be available to business located in the designated areas.
  
  

  
  
  
  
  

  “Don’t bother me I’m working on my Renewal Community Application.”

  
  
  
  

  3 ELIGIBILITY REQUIREMENTS

  CERTS

  ACTION
  
  

  Renewal Community Competition
  

  Three Key Elements

  
  
  
  

  “I’m worried that I won’t get a chance to compete.”

  
  
  
  

  Renewal Community Workshop Presenters
  

  Linda Schakel

  John Haines

  Phil Graham
  

  202–708–6339

  www.hud.gov/offices/cpd/ezec
  

  
  
  
  

  Tax Benefits for Businesses and TIUPs

  
  
  
  

  
  
  

  Renewal Community

  Application Workshop

  
  
  
  

  Why apply to be a Renewal Community

  Geographic and Economic Condition Requirements

  Course of Action

  Certification Forms
  

  Overview

  
  
  
  

  Be able to identify two benefits of the RC program

  Understand the eligibility criteria to select an appropriate area to nominate
  
  
  

  Objectives

  
  
  
  

  Significant Federal Tax Incentives

  Easy Application Process

  Course of Action vs. Strategic Plan

  CoRA vs. Governance Structure

  TIUP after Designation vs. TIUP in Strategic Plan

  Selection is Objective

  100 percent Statistics
  
  
  

  Why Apply to be an RC?

  
  
  
  

  Nominating Governments
  

  Each State and local government

  Local are “general purpose political subdivisions”

  Reservation governing body is both state
  and local
  
  

  Preparing Your Application

  Who Nominates an RC

  
  
  
  
  

  Preparing Your Application

  Geographic and Economic Condition Requirements

  
  
  
  

  Boundary Map
  

  “Continuous boundary”

  Required boundary layers

  Census tracts

  States

  Counties or parishes -- partial is okay

  Cities and towns -- partial is okay

  Townships (?)

  Boundaries change--nominators are responsible
  

  Preparing Your Application

  Geographic and Economic Condition Requirements

  
  
  
  

  Maps are available through the U.S. Census Bureau at 301–457–4100 or through State Data Centers. Check www.census.gov/sdc/www/ for a list of State Data Centers

  Please update pages A-3 and A-9 of the RC Application Guide
  

  Preparing Your Application

  Geographic and Economic Condition Requirements

  
  
  
  

  Any of the nominating jurisdictions

  Has a population of 50,000 or greater and

  Is located within a Metropolitan Area (MA)
  

  Urban Nominated Areas
  

  Preparing Your Application

  Geographic and Economic Condition Requirements

  
  
  
  

  Rural Area Jurisdiction(s)
  

  Population less than 50,000 or

  Outside a Metropolitan Area (MA) or

  Determined by HUD/Commerce
  

  Preparing Your Application

  Geographic and Economic Condition Requirements

  
  
  
  

  Population of Nominated Area
  

  Use the Census Tract Data Form

  Not more than 200,000

  At least 4,000 for Urban

  At least 1,000 for Rural

  Not required within Indian reservation
  

  Preparing Your Application

  Geographic and Economic Condition Requirements

  
  
  
  

  Poverty, Unemployment, and Income
  

  Use the Census Tract Data Form

  Different for Urban and Rural

  On-Line is an option
  

  Criteria Thresholds (1990 Census)

  20% Poverty

  9.4% Unemployment

  70% Low income (Urban only)
  

  Preparing Your Application

  Geographic and Economic Condition Requirements

  
  
  
  

  An Applicant Must Demonstrate
  

  “pervasive poverty, unemployment, and
  general distress”

  Narrative, tables or charts, or combination
  
  

  Preparing Your Application

  Geographic and Economic Condition Requirements

  
  
  
  

  Unemployment Indicators
  

  “… not less than the national average rate” or
  

  “especially severe economic conditions … that have brought about significant job dislocation”
  
  

  Preparing Your Application

  Geographic and Economic Condition Requirements

  
  
  
  

  General Distress Indicators
  

  Income

  Welfare

  Tax base

  Crime

  Health data

  Education data

  Homelessness, housing

  Infrastructure
  
  

  Preparing Your Application

  Geographic and Economic Condition Requirements

  
  
  
  

  Course of Action Requirements
  

  Reduce Tax Burdens

  Improve Local Services

  Reduce Crime

  Involve Community Partners

  Gift of Real Property

  Reduce government requirements
  
  

  Preparing Your Application

  
  
  
  

  Potential Actions To Reduce Government Requirements in Renewal Communities
  

  Density Bonuses

  One-stop Permits

  Variance/Exception Policies

  Voluntary Environmental Compliance Program
  

  Preparing Your Application

  
  
  
  

  Course of Action
  

  Written document

  Signed by:

  State and local governments or

  Reservation governing body

  Committing to measurable goals and actions

  Including timetable with steps and dates

  Describing how performance will be evaluated
  

  Preparing Your Application

  
  
  
  

  Course of Action Key Partners
  

  Faith-based Organizations

  Residents

  Businesses

  Local Nonprofits

  Schools and Universities
  
  

  Preparing Your Application

  
  
  
  

  Four Certification Forms
  

  Certification Forms 1, 3, and 4 are mandatory

  Certification Form 2 is optional--for bonus points

  Responsible official must sign each form
  
  

  Preparing Your Application

  
  
  
  

  Certification Form 1:
  Economic Condition Requirements
  

  Poverty, Unemployment, and Income

  Pervasive poverty, unemployment, and
  general distress

  “Responsible official” for each nominating government must sign
  

  Preparing Your Application

  
  
  
  

  Definition of Responsible Official
  

  “an official or employee authorized to act on behalf of the government for that purpose”
  
  

  Preparing Your Application

  
  
  
  

  Certification Form 3:
  Economic Growth Promotion Requirements
  

  Repeal or reduce--

  Licensing for occupations

  Zoning for home-based businesses

  Permits for street vendors

  Restrictions on schools or child care

  Restrictions on jitneys, cable television, or trash haulers

  Narrow exception--health and safety
  

  Preparing Your Application

  
  
  
  

  Certification Form 4:
  Public Notice
  

  Notice of, and opportunity to participate in,
  the application development process

  Examples:

  Newspapers or other media

  Public meetings

  Soliciting comments
  

  Preparing Your Application

  
  
  
  

  Certification Form 2 (optional):
  Local Crime Index Certification
  

  Use for one, two or four bonus points

  1999 police agency data for the nominated area

  All nominating governments must sign
  

  Preparing Your Application

  
  
  
  

  Basic Application Requirements
  

  Submission deadline: October 12, 2001, 5 p.m. eastern time

  Package should include one original and two copies No faxes

  Certain materials may be submitted online
  
  

  Submitting Your Application

  
  
  
  

  Application Checklist
  

  Map of nominated area

  Nomination forms

  Course of Action

  Four certifications (including one optional certification)

  Economic distress narrative
  
  

  Submitting Your Application

  
  
  
  

  RC/Round III EZ On-line Application System
  

  www.ezrc.hud.gov

  Submit Census Tract Data form

  Submit Geographic/Population/Economic Condition Requirements form

  Assists users in choosing tracts

  Automatically calculates rates

  Unemployment

  Low-income

  Illustrates 20-percent poverty tracts

  Allows users to print out certification forms
  

  Submitting Your Application

  
  
  
  

  RC Application Threshold Requirements
  

  Nominated area meets all eligibility requirements

  Submission of Course of Action

  Submission of required certifications
  

  How HUD Makes Selections

  
  
  
  

  Ranking Rural Applicants
  

  Poverty

  Unemployment
  

  How HUD Makes Selections

  
  
  
  

  Ranking Urban Applicants
  

  Poverty

  Unemployment

  Income
  

  How HUD Makes Selections

  
  
  
  

  Incidence of Crime Bonus Points
  
  LCI = Local Crime Index
  

  Four points: LCI is less than 4,266.8

  Two points: LCI is at least 4,266.8, not more than 4,693.48

  One point: LCI is more than 4,693.48, less than 5,334
  

  How HUD Makes Selections

  
  
  
  

  Bonus Points
  

  Incidence of crime in area

  One to four points

  Census tracts in General Accounting Office Report

  One point
  

  How

  HUD Makes Selections

  
  
  
  

  Selection Preferences
  

  Existing Empowerment Zones and Enterprise Communities receive the first 20 designations

  At least 12 Rural nominations will be selected
  

  How HUD Makes Selections

  
  
  
  

  Five-Step Designation Process
  

  Convene

  Verify

  Develop

  Submit

  Implement
  

  Partnering For Community Renewal

  
  
  
  

  State/Local Participants
  

  Community-based organizations

  Responsible officials

  Contact persons
  

  Partnering For Community Renewal

  
  
  
  

  Coordinating Responsible Authority (CoRA) Responsibilities
  

  Functions as Central POC

  Carries out Commitments

  Develop and Administers Procedures

  Assist in Developing the TIUP

  Submit Periodic Reports
  

  Partnering For Community Renewal

  
  
  
  

  Additional Materials
  

  Interim Rule

  Notice Inviting Applications

  Tax Incentive Guide for Businesses in the
  Renewal Communities, Empowerment Zones,
  and Enterprise Communities

  Renewal Communities: Urban and Rural
  Application Guide
  
  

  For copies, call 800–998–9999 or visit

  www.hud.gov/offices/cpd/ezec
  
  

  Partnering For Community Renewal

  
  
  
  

  Questions and Answers

  
  
  
  

  Renewal Community
  and Round III
  Empowerment Zone
  Technical Assistance Workshops

  
  

  ---

  Official Louisiana Renewal Community Information   Posted: May 10, 2002
  Official Louisiana Renewal Community Information - Site information on the Renewal Communities of North, Central, Ouachita Urban and New Orleans/Jefferson Urban.

  
  Renewal Community Employment Credit.

  An Excellant Site! Good contacts, well presented links & text.
  

  ---

  HUD's RC's Key Principles   Posted: May 10, 2002
  The RC/EZ/EC Initiative is designed to afford communities real opportunities for growth and revitalization. The framework for the Initiative is embodied in four key principles:
  • 1. Strategic Vision for Change
  • 2. Community-based Partnerships
  • 3. Economic Opportunity
  • 4. Sustainable Community Development.

    Each Renewal Community has a Coordinating Responsible Authority (CoRA) in lieu of a governance board. The CoRA, which may be an entity, organization, person or persons, is authorized by the government(s) that nominates the RC for designation. The CoRA functions as the RC's central point of contact and takes on the responsibility and authority to carry out the program as detailed in the course of action and certifications of commitment. The CoRA is also responsible for promoting RC benefits and making required reports to HUD.
    

    ---

    OUACHITA PARISH RECEIVES U.S. HUD URBAN RENEWAL COMMUNITY DESIGNATION:   Posted: May 10, 2002
    OUACHITA PARISH RECEIVES U.S. HUD URBAN RENEWAL COMMUNITY DESIGNATION:

    Ouachita Parish was notified at the end of January that they have been designated one of 40 Renewal Communities nationwide. These renewal communities share in approximately $17 Billion worth of incentives to businesses located inside the perimeters of the Renewal Communities and who employ individuals living within the boundaries. HUD, as part of the Community Renewal Tax Relief Act of 2000 authorized the establishment of 40 renewal communities across the country. The State of Louisiana received 4 of the 40, with Ouachita Parish receiving one of 12 Urban Renewal Communities nationwide
    

    ---

    Searching for information on Appal.org.   Posted: May 10, 2002
    

    HOWTO: Searching for information on Appal.org.

    
    

      
    Introduction  
    Browser Basics  
    Using Find to Search Headlines  
    Using Find to Search Postings  
    Using Google to search Appal.org  

    
    
    • Introduction

      Searches on Appal.org tend to be a two step process, where the first search happens at the website, and the second happens in your browser. The web site will send you selected postings, groups of postings, or all headlines. Use your browsers text search tool (usually "Find in This Page" in the browser's EDIT menu) to find keywords in the served pages.

    • Browser Basics

      Your browser will search within a page of HTML for a given keyword. Usually this is the CTRL-F key pair, but it may be a different key command in your case. You may need to poke around the Edit Menu for the Find command. It is usually referred to as "Find in this page".

      Use the Find command to search for a key word in the current page. Two particular uses demonstrate the general use: Finding a key word in the headline list, and finding a key word in the search results returned by the Search All Postings button. Together , these two search techniques let you quickly ferret out key words in the Appal.org postings.

    • Using Find to Search Headlines

      Most pages on Appal.org have a "BROWSE HEADLINES AND POSTINGS" button at the bottom of the page. You can also get this page from the Search option in the Main Menu. Hit the Browse button and ALL the headlines for all postings on Appal.org will be listed chronologically. You can browse the headlines to find postings that interest you. Use the Find command (CTRL-F) to search the headlines. When you find one of interest, clicking on it's headline will display the posted article.

    • Using Find to Search Postings

      Most pages on Appal.org have a "SEARCH ALL POSTINGS" button at the bottom of the page. You can also get this page from the Search option in the Main Menu. Enter your keywords and hit the Search key. ALL postings that contain that word will be displayed in one page. Use care when you compose your keywords, or you will get a lot of document back. After you have used the Search button to return all the postings that contain your keyword, use the Find command (CTRL-F) to search the page for your keywords.

    • Using Google to search Appal.org

      The Search option in the Main Menu offers you a link to Google, a pre-eminant web search engine. Eventually, popular links tend to get listed on Google, and some Appal.org pages may be listed there. Google allows for very sophisticated searching. The breadth and depth of a Google search is impressive, and if you are not already familiar wih the search engine, you might take a moment to look at Google now.

    
    

    ---

    BOWL RC Designation Announcements, Early HUD Announcenments and Original Statutes Creating RC's   Posted: May 10, 2002
    

    HUD ANNOUNCES EASTERN KENTUCKY COUNTIES SELECTED AS A RENEWAL COMMUNITY - ELIGIBLE FOR $17 BILLION IN TAX INCENTIVES HUD No. 02-013EKY Contact: John Milchick, Jr. (502)582-5816 For Release Tuesday January 22, 2002 LOUISVILLE, KY - The Department of Housing and Urban Development today announced that four counties in eastern Kentucky will be designated a "Renewal Community," eligible to share in an estimated $17 billion in tax incentives to stimulate job growth, promote economic development and create affordable housing. The 2000 Community Renewal Tax Relief Act established the Renewal Community Initiative that will encourage public-private collaboration to generate economic development in 40 distressed communities around the nation. President Clinton's New Markets Initiative: Revitalizing America's Underserved Communities December 14, 2000 Today, President Clinton is pleased to announce the passage of the historic new bipartisan New Markets and Community Renewal initiative. INCREASE IN THE PRIVATE ACTIVITY BOND CAP: The legislation increases the state private activity bond cap from $50 per resident to $75 per resident, phased in from 2001 to 2002. Private activity bonds allow states and municipalities to encourage economic growth in communities through the issuing of lower cost tax exempt bonds. HUD Notice Inviting Applications: Designation of Forty Renewal Communities FOR FURTHER INFORMATION: For technical questions, contact John Haines, Renewal Community Initiative, Office of Community Planning and Development, Department of Housing and Urban Development, 451 Seventh Street, SW, Room 7130, Washington, DC 20410, (202) 708-6339. Hearing- or speech-impaired individuals may call (800) 877-8339 (the Federal Information Relay Service-TTY). HUD prefers to receive technical questions by email to john_haines@hud.gov or by facsimile (FAX) to (202) 401-7615 or (202) 708-3363, since email or FAX enables the questions and answers to be communicated as rapidly as possible in writing. US CODE COLLECTION Notes on Sec. 1400E. Pub. L. 106-554, Sec. 1(a)(7) (title I, Sec. 101(c)), Dec. 21, 2000, 114 Stat. 2763, 2763A-599, provided that: ''Not later than January 31 of 2004, 2007, and 2010, the Comptroller General of the United States shall, pursuant to an audit of the renewal community program... report to Congress on such program and its effect on poverty, unemployment, and economic growth within the designated renewal communities, empowerment zones, and enterprise communities.' ADVISORY COUNCIL ON COMMUNITY RENEWAL 'There is established an advisory council to be known as the 'Advisory Council on Community Renewal' (in this part referred to as the 'Advisory Council'). ''SEC. 153. DUTIES OF ADVISORY COUNCIL. H.R.815 Title: To amend the Internal Revenue Code of 1986 to provide for the designation of renewal communities, to provide tax incentives relating to such communities, and for other purposes. Sponsor: Rep Watts, J. C., Jr.(introduced 2/24/1999) Related Bills: S.463 Latest Major Action: 3/18/1999 Referred to House subcommittee S.463 Title: To amend the Internal Revenue Code of 1986 to provide for the designation of renewal communities, to provide tax incentives relating to such communities, and for other purposes. Sponsor: Sen Abraham, Spencer(introduced 2/24/1999) Related Bills: H.R.815 Latest Major Action: 2/24/1999 Referred to House subcommittee

    ---

    RC Links to supporting agencies and institiutions   Posted: May 9, 2002
    
    
    
    
    • Kentucky Enterprise Zone Program: Ky Cabinet for Economic Development Phyllis Bruning, Director Email Phyllis Bruning
    
    
    • UK Rural Studies Program conduct research into the economic opportunities and problems of rural areas.
    
    
    • Links to useful sites for local government leaders.
    
    
    • A gateway to statistics from over 100 U.S. Federal agencies. The Mapstats link here is really good
    
    

    ---

    Federal list of current funding opportunities   Posted: May 9, 2002
    Notices of Funding Availability- A Federal list of current funding opportunities
    

    ---

    Testimony to the House Committee on Small Business 105th Congress 105th Congress on HR3865: The American Community Renewal Act   Posted: May 9, 2002
    Testimony to the House Committee on Small Business 105th Congress 105th Congress on HR3865: The American Community Renewal Act

    Avis C. Vidal co-principal investigator of the evaluation of the Empowerment Zone and Enterprise Community program.

    Principal Research Associate The Urban Institute Washington, D.C.

    May 19, 1998 ...Second, the bill makes no provision for managing Renewal Communities-and good, entrepreneurial management costs money. This would not be a problem for Renewal Communities that are also Empowerment Zones, because they have Title XX funds (or local matching funds) to support the management entities they already have in place. It would be a problem for newly-designated zones, and for Renewal Communities that are also Enterprise Communities, since many will have no federal funding to support their zone management entities after the current fiscal year.

    What, then, accounts for the limited number of successful zones pointed to by Erickson and Friedman and others? The weight of the available evidence indicates that "successful" zones have two characteristics:

    Successful zones are good places to do business. Although the zones designated under state programs include residential areas that are experiencing some level of distress (most commonly measured in terms of high unemployment, high poverty rates, and low median income), they also include areas with genuine development potential, including a labor pool with good basic skills.

    Successful zones are actively managed by individuals with entrepreneurial skills-people who (a) reach out to business owners in the zone to keep them informed about the benefits available to them and provide them with tax forms and specific information about exactly how to take advantage of the benefits; (b) market the zone and its advantages to firms outside the zone that seek new locations; and (c) represent zone businesses in seeking improvements, such as new infrastructure, to the zone.

    
    

    ---

    Focus on Partnerships   Posted: May 9, 2002
    Focus on Partnerships.

    The RC Initiative focuses on creating meaningful and productive partnerships, which HUD will fully support through technical assistance and capacity-building activities. Technical assistance available to RCs will include easy access to available Federal resources and programs, a network for reaching out to the business community, and help in implementing courses of action. Building Lasting Alliances. The RC Initiative looks at ways to gain support and commitment from State and local governments to compose and refine a course of action that substantively addresses regulatory barriers, tax relief, and improvement of local services in the nominated areas. EZ Designation Increases Business EZs prove that even seemingly insurmountable obstacles faced by a distressed community can be overcome through public and private partnerships. The successes of EZs can be tangibly measured in $4 billion in new private-sector investments in community development, in improved bond ratings, and in increased numbers of decent and affordable housing structures. Seven New Zones. Urban communities will have the opportunity to compete for seven additional designations available in Round III. Currently, there are 23 designated urban EZs representing an elite group of communities renowned and nationally recognized for their successes in urban revitalization. More Tax Credits. One of the major benefits offered to Round III EZ designees is a generous multimillion-dollar tax package that will include the EZ wage credit and the Work Opportunity Tax Credit. Federal Bonus Points. Other benefits include special preferences and consideration in obtaining funding through other Federal competitions, with many offering bonus points to EZs. Technical Assistance. As a designated EZ, awardees receive funding and program information through HUD's Office of Empowerment Zones and Enterprise Communities. Round III EZ designees will have a network of experienced and knowledgeable Round I and Round II EZ communities to draw from for guidance and experience.

    
    

    ---

    Notice Inviting Applications, Filed 8-6-01: Designation of Forty Renewal Communities   Posted: May 9, 2002
    Notice Inviting Applications: Designation of Forty Renewal Communities Filed 8-6-01

    ------------------------------------------------------------------------ Directive Number: FR-4663-N-02 ------------------------------------------------------------------------ Click Here to Dowmload PDF File ------------------------------------------------------------------------

    DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT

    [Docket No. FR-4663-N-02]

    Notice Inviting Applications: Designation of Forty Renewal Communities

    AGENCY: Office of the Assistant Secretary for Community Planning and Development, HUD.

    ACTION: Notice inviting applications.

    SUMMARY: The Community Renewal Tax Relief Act of 2000 (CRTR Act) authorizes HUD to designate up to 40 Renewal Communities within which special tax incentives would be available. This Notice invites applications for designation of nominated areas as Renewal Communities (RCs) in accordance with the designation process described in this Notice.

    APPLICATION DUE DATE: To be eligible, a complete application (one original and 2 copies) must be received no later than October 12, 2001. See below for specific procedures applicable to the type of delivery used (e.g., mailed, express mail, overnight delivery). No facsimile (FAX) applications will be accepted for consideration by HUD. Delivered Applications. Complete applications (one original and two copies) must be received no later than 5:00 PM eastern time, on October 12, 2001. Up until 5:00 PM on the deadline date, completed applications will be accepted at the address and room number specified below. Mailed Applications. Applications will be considered timely if postmarked on or before October 12, 2001. Applications Sent by Overnight Delivery. Overnight delivery items will be considered filed on time if received on or before October 12, 2001. Electronic Submission of Application Information. Information submitted electronically using the RC/EZ On-line Application System must be submitted not later than 5 PM, Eastern Time on October 12, 2001. This is done by hitting the ``Submit'' button at the appropriate location in the software. The system will not be available after the deadline.

    ADDRESSES: Address for submitting applications. All paper application materials (one original and two copies) must be submitted to: Department of Housing and Urban Development, Office of Community Planning and Development, c/o Processing and Control Unit, Room 7255, 451 Seventh Street, SW, Washington, DC 20410. Some information may also be submitted electronically, as provided elsewhere in this notice. For Application and Other Materials. For a copy of all RC publications, including the Application Guide, Nomination Forms, and the interim rule (24 CFR part 599, published July 9, 2001, 66 FR 35850), please call the Community Connections Information Clearinghouse at (800) 998-9999. The RC publications are also available from HUD's web site at: https://www.hud.gov/offices/cpd/ezec. Requests for application materials should be made immediately to allow sufficient time for application preparation. Hearing- or speech-impaired persons should use the Federal Information Relay Service telephone number, (800) 877-8339, to obtain application materials. The Renewal Community publications consist of: (1) This Notice Inviting Applications; (2) The Renewal Communities Interim Rule (24 CFR part 599, published July 9, 2001, 66 FR 35850); (3) Renewal Communities Application Guide, 2001 (RC Application Guide); and (4) Tax Incentive Guide for Businesses in the Renewal Communities, Empowerment Zones, and Enterprise Communities.

    FOR FURTHER INFORMATION: For technical questions, contact John Haines, Renewal Community Initiative, Office of Community Planning and Development, Department of Housing and Urban Development, 451 Seventh Street, SW, Room 7130, Washington, DC 20410, (202) 708-6339. Hearing- or speech-impaired individuals may call (800) 877-8339 (the Federal Information Relay Service-TTY). HUD prefers to receive technical questions by email to john_haines@hud.gov or by facsimile (FAX) to (202) 401-7615 or (202) 708-3363, since email or FAX enables the questions and answers to be communicated as rapidly as possible in writing.
    

    ---

    Cooperation Among the Nominating Governments and Community Organizations   Posted: May 9, 2002
    C. Cooperation Among the Nominating Governments and Community Organizations

    Every application for RC designation must contain a course of action describing the commitment to cooperation in the nominated area by the nominating governments and community organizations that meets the requirements of this section II.C. listed immediately below.

    C. Cooperation Among the Nominating Governments and Community Organizations

    Every application for RC designation must contain a course of action describing the commitment to cooperation in the nominated area by the nominating governments and community organizations that meets the requirements of this section II.C. listed immediately below.

    1. Commitment to a course of action. A course of action is a written document, signed by the nominated area's State and local governments, or in the case of a nominated area located within an Indian reservation, the reservation governing body, and community-based organizations which commits each signatory to undertake and achieve measurable goals and actions within the nominated area upon its designation as a Renewal Community.

    2. Community-based organizations. For purposes of the course of action, ``community-based organizations'' includes for-profit and non- profit private entities, businesses and business organizations, neighborhood organizations, and community groups. Community-based organizations are not required to be located in the nominated area as long as they commit to achieving the goals of the course of action in the Renewal Community.

    3. Timetable. The course of action must include a timetable that identifies the significant steps and target dates for implementing the goals and actions.

    4. Performance measures. The course of action must include a description of how the performance of the course of action will be measured and evaluated.

    5. Required goals and actions. The course of action must include at least four of the following:

    a. A reduction of tax rates or fees applying within the Renewal Community;

    [[Page 41435]]

    b. An increase in the level of efficiency of local services within the Renewal Community, such as services for residents funded through the Federal Temporary Assistance for Needy Families program and related Federal programs including, for example, job support services, child care and after school care for children of working residents, employment training, transportation services and other services that help residents become economically self-sufficient;

    c. Crime reduction strategies, such as crime prevention, including the provision of crime prevention services by nongovernmental entities;

    d. Actions to reduce, remove, simplify, or streamline governmental requirements applying within the Renewal Community, such as:

    i. Density bonus. Permission to develop or redevelop real property at a higher density level than otherwise permitted under the zoning ordinance, e.g., increased height or increased number of residential or business units;

    ii. Incentive zoning. Providing a density bonus or other real property-related incentive for the development, redevelopment, or preservation of a parcel in the designated area;

    iii. Comprehensive or one-stop permit. Streamlining construction or other development permitting processes, rather than requiring multiple applications for multiple permits, e.g., for demolition, site preparation, and construction, the developer or redeveloper submits asingle application that is circulated for the necessary reviews by the various planning, engineering, and other departments in the county or municipality;

    iv. Variance and exception policies. Counties or municipalities may pass ordinances that permit variances to or exceptions from certain zoning or other land use limitations. Examples include a reduced building set-back requirement or a reduced requirement for the provision of parking. The policy may be limited to a particular geographic area.

    v. Voluntary environmental compliance program. A shared or limited environmental liability program, with limited liability from certain legal or administrative action in exchange for undertaking an approved program of environmental investigation, hazard control, and on-going risk reduction activities. Typically, the liability limitation is for future environmental cleanup (and not against lawsuit for damages). Risk of cleanup may be shared by the developer or property owner and the government;

    e. Involvement in economic development activities by private entities, organizations, neighborhood organizations, and community groups, particularly those in the Renewal Community, including a commitment from such private entities to provide jobs and job training for, and technical, financial, or other assistance to, employers, employees, and residents from the Renewal Community;

    f. The gift or sale at below fair market value of surplus real property held by State or local governments, such as land, homes, and commercial or industrial structures in the Renewal Community to neighborhood organizations, community development corporations, or private companies.

    6. Recognition of past efforts. The course of action is not limited to future goals and actions. Past efforts within the previous eight years, either completed or on-going, of the nominating State or local governments in reducing the various burdens borne by employers and employees in the nominated area by undertaking any of the goals or actions listed in section II.C.5., above, of this notice may be used to meet the course of action requirement. If past efforts are used, the course of action must identify which of the required goals and actions listed in section II.C.5. they address; the timetable for their continued implementation, if on-going; the community-based organizations involved, if any; and an evaluation of their performance and the performance measures used.
    

    ---

    Summary of Community Renewal and New Markets Act of 2000 (S. 3152)   Posted: May 9, 2002
    Summary of Community Renewal and New Markets Act of 2000 (S. 3152)

    The idea behind the RC/NM initiative has been described as a merger of President Clinton's "New Markets Initiative"--including a tax credit and other incentives designed to attract capital to low-income areas--with a House Republican proposal called the "American Community Renewal Act (H.R. 815), which would provide tax and regulatory relief to economically distressed areas and help poor families set up subsidized savings accounts. (12) Instead of a merger, however, the bipartisan, anti-poverty package has been characterized as a juxtaposition: "We allow two different forms to see what we can learn over the next several years about what works best in attracting investment and job growth," said Gene Sperling. (13)

    Indeed, if a renewal communities/new markets initiative is enacted, it may be possible in a few years to examine the results and draw conclusions about which incentives, programs, and approaches seem to work best. The phenomenon of moribund urban and rural areas, and the myriad economic and human problems associated with them, will present a public policy challenge for the foreseeable future. The need to learn what works best argues for systematic collection of data that will facilitate program evaluation.

    On the other hand, history has shown that drawing conclusions about these types of economic development programs will not be easy. By the late 1980s, about three dozen states had created a variety of enterprise zone programs, yet even today there is little information about what works and what does not. The simple fact is that it is difficult to judge the success of economic development efforts. As one report notes:

    Although the economic development literature often discusses the potential effects of enterprise zones, empirical research on, or analysis of zone programs is somewhat limited. The modest amount of empirical research is due to two basic constraints: (1) the lack of reliable quantitative data to evaluate zone performance, and (2) the difficulty of isolating the effects of zone designation and incentives from those of other economic development factors and initiatives.

    ---

    Rural Renewal Community Informal Discussion in DC   Posted: May 9, 2002
    Sent: Monday, May 06, 2002 11:38 AM Subject: Rural Renewal Community Informal Discussion in DC

    TO: RURAL RENEWAL COMMUNITY MEMBERS FROM: BRUCE S. REYNOLDS MISSISSIPPI RURAL RC CoRA

    SUBJECT: INFORMAL DISCUSSION

    By way of introduction, my agency orchestrated and has been named as the CoRA for the Mississippi Rural Renewal Community. This designation will go far in helping the economic situation in each of our designated areas. With this being a new program there are many unanswered questions, and each of us have similar challenges and questions.

    With that in mind I would like to invite you and your fellow Rural RC CoRA counterparts to join CMPDD on Sunday May 19, at 4:00p.m. at the Marriot Crystal City Hotel Restaurant or Cocktail Lounge, depending on the response, for an informal discussion. Items of discussion may include:

    1. Your efforts to date regarding organizing your Rural RC. 2. How you envision your Rural RC functioning. 3. How you are paying for administration. 4. Your plans to ensure that business/industry take full advantage of this program. 5. Success stories 6. Problems / Challenges

    While this will be held in conjunction with the HUD Community Renewal Implementation Conference, this is an independent effort on our part to initiate dialogue and address issues common to Rural RC’s. We are not affiliated with nor sanctioned by H.U.D. Please fill out and fax or e-mail back your RSVP in regard to this meeting.

    I look forward to meeting each of you in Washington!
    

    ---

    Listen to the BOWL CoRA meetings: 4-27-02   Posted: May 8, 2002
    4-27-02

    Download Part 1 first (about 5 minutes on a modem line), and then pull down the rest while you listen. Click on the "Part #" to download. Part 1, Part 2, Part 3, Part 4, Part 5

    ---

    The meeting sound files are low fidelity MP3's. The file names are MM.DD.YY.part#.mp3, that is the month, day and year, of the meeting and then the sequence number of the file, ie: part 1, part 2, etc.

    I apologize for the very poor quality of part four: the cassette tracked very poorly on playback.

    The files are sized to download quickly and to fit on a floppy diskette. You can bring down the first file in less than 5 minutes. While listening to the first part of the meeting, you can download the remaining files.

    Use any MP3 player to listen to the meeting files. Common players are the Windows (c) Media Player, FreeAmp, Xmms, and any of the standalone players like the Rio.

    Please forgive the sound quality, and the occaisional pops, warbles and dropouts-MP3's are a "lossey" compression technology and many compromises are made to make the files this small.

    Bits of the meeting are not recorded, for example: flipping tapes, lunches, long silences, pre and post meeting discussions.
    

    ---

    HUD's Renewal Community Web Page.   Posted: May 5, 2002
    Renewal community (rc) competition information and resources" This is the big HUD web page with most of the information you'll need on it. If you need to find a contact at HUD, or learn more about HUD policy, this is the place to start.

    
    
    To Search the HUD web site go here.
    

    ---

    Renewal Community Links on Appal.org   Posted: May 4, 2002
    The links listed here will take you to information about HUD's Renewal Communities Program. Categories include general information on Renewal Communities, Tax Advantages and Issues, the CoRA: Managing the RC program, Renaissence Communities and Renewal Communities on Main Street, and information specific to the Eastern Kentucky RC.
    
    
    
    • Renewal Communities on Appal.org
      
    • Tax Advantages and Issues in Renewal Communities
      
    • The Eastern Kentucky Renewal Community: Breathitt, Owsley, Wolfe and Lee Counties
      
    • Renewal Communities: Management and Oversight
      
    • Renaissence Communities and Renewal Communities: Meeting on Main Street
      
    • The Non-Profit Library: Web resources for the Construction & Operation of Non-Profits.
      

    ---

    JOINT COMMITTEE ON TAXATION SEARCH ENGINE   Posted: April 30, 2002
    JOINT COMMITTEE ON TAXATION SEARCH ENGINE

    
    
    
    To search for a document on the Joint Committee on Taxation's website, enter a single word, several words, or a phrase.
    
    

    ---

    Main Street Revitalization in Beattyville (5 of 12)   Posted: April 30, 2002
    Get Ready, Company is Coming!
    
    Submitted: 11 Feb. 2002
    By: Larrey Riddle
    
    Something exciting happened in Beattyville last Thursday night. It was not particularly Earth shattering. And, if you came to town Friday morning, nothing appeared any different. In fact, unless you spoke to one of the forty-five people who were there and witnessed it, you might not even know that something fundamental had changed.
    
    So, what was it?
    
    Simply this. People decided to take the future into their own hands. Forty-five people, from all walks of life, decided that they could effect how the future settles on their community. An organization was formed. As of now, it is an organization without a name, without a charter, and without leadership. Those details will be worked out at the next meeting. The amazing part of this is that people realized that if things are going to change, it had to be fueled by them. Not by government. Not by some of the myriad of non-profit organizations dedicated to “help” the people of the region. But, by the people whose futures are at stake. Government and non-profits are an important part of the solution. They can provide funds and technical assistance. Last Thursday night forty-five people decided to take the first step in making changes to their community. They decided to improve things themselves.
    
    The meeting began with the agenda of forming a downtown association, looking to starting the process of a Main Street revitalization project. The merchants with shops downtown were well represented, but everyone saw the need for an organization that was more inclusive. After all, most of the people who work in Beattyville live not in town, but out in the county. The vitality of both is linked. The futures of both are inseparable. Those plans may include a Main Street project. They may include looking at ways to generate more business for merchants. The plans may include attracting new businesses. It may include developing a tourism infrastructure. Whatever direction this newly found organization decides to go, the biggest step has been taken.
    
    Naming the organization, electing officers, and setting short and long term goals will all be dealt with at the next meeting. It will take place February 21st, at 7:00 p.m. at the P.E.P. Coalition offices. You are invited.
    
    
    

    ---

    Main Street Revitalization in Beattyville (4 of 12)   Posted: April 30, 2002
    Get Ready. Company is Coming!
    
    Fourth of twelve articles first published in the "Three Forks Tradition" newspaper
    
    By: Larrey Riddle
    
    Paint the Town Yellow
    
    Paint the town green. Paint the town purple, if you like. A number of years ago, I am told, the debate on what color to paint the newly restored City Hall was a lively one. Now, as we are presented with the opportunity to revitalize Beattyville’s downtown, the need for consensus is even more important. The decisions necessary for that process to succeed are complicated and without teamwork and participation of a wide group of people, can be difficult. What is needed is a plan, Stan.
    
    Two weeks ago, we invited everyone to a “town meeting” to discuss the benefits and process for Beattyville to become a Kentucky Renaissance community. There was a good turnout. People came because they care about the direction our town goes. It was a good beginning. But, in a sense, it was also putting the cart before the horse. Before we can even begin the process of a Main Street revitalization, we need an organization that can build consensus and establish a plan. While advocating the importance of a grassroots initiative, we were ignoring the fact that revitalizing Main Street is not necessarily what people wanted.
    
    Therefore, without any further ado, I would like to propose the formation of a Downtown Association. The first order of business is to develop a “business plan” for downtown Beattyville. Like any good business plan it should identify assets and establish goals and objectives for the enterprise. It will provide a vision for where we are going. It will identify the hazards along the way, which can prevent us from getting there. It is a roadmap for where we go from here.
    
    At the end of that process, the group may decide that the best thing for Main Street is to paint the town yellow. The group might decide to return to horse drawn wagons, or put on afternoon tea dances. Alternatively, we might decide to do nothing at all. And maybe, just maybe, the group will decide to put aside differences and pull together to begin a Main Street revitalization project. Whatever is decided, it will be a decision made by the group.
    
    Join the discussion this Thursday, February 7th at the PEP offices in the Congleton Building on Main Street at 7:00 p.m. Please note that the location has been changed to make room for more people. Everyone is welcome. Your active participation is needed.
    
    

    ---

    Main Street Revitalization in Beattyville (3 of 12)   Posted: April 30, 2002
    Get Ready, Company is Coming!
    
    Third of twelve articles first published in the "Three Forks Tradition" newspaper
    
    By: Larrey Riddle
    
    
    Redefining Main Street
    
    Norman Rockwell’s portraits of a slow-paced, more innocent time defined our image of small towns in the fifties. Mom and Pop shops, where every customer was a neighbor, set the standard. Small town America, in all its innocence, never looked so good. Shop owners lived above the store and made a good living. You never saw a “Going Out of Business” sign in a Rockwell painting.
    
    Now, think about what was really happening in the period when Rockwell was in his heyday. America was rapidly becoming an urban society. Our own mountains, like rural areas everywhere, were emptying as people moved to Detroit and Chicago and Dayton for jobs that did not exist at home. According to Small Business Economics by W.A. Brock and D.S. Evans the period of 1958 to 1980 found that companies employing less than 500 people experienced a continual decrease in revenues that did not begin to turn around until the late 1970’s.
    
    It has never been easy to run a small business. It takes a combination of hard work, luck, uncanny insight into customers’ needs, and more hard work. Today, small town retail businesses face pressures unimaginable just a generation ago. Discount superstores, catalog and Internet sales, and dips in the economy make running a viable business a challenge of unparalleled proportions.
    
    Yet, a viable Main Street is comprised of robust retail businesses. The process of revitalizing our Main Street must include providing resources businesses need to thrive and succeed. Fortunately, there are some very good resources available both locally and on the Internet for advice on every aspect of running a retail business. Here are some of my favorite Internet sites:
    
    www.business.com This a good site for business research. It is very well organized and you can customize the site to your own industry or product lines.
    
    www.smallbusiness.com The National Federation of Independent Business (NFIB) has linked with this site to offer a free peer-to-peer network for exchanging ideas and advice.
    
    www.isquare.com This site offers tips and wisdom about dealing with suppliers.
    
    www.gatton.uky.edu/rboc/ce/ce.html The University Of Kentucky’s “Center for Entrepreneurship” provides technical support for new and expanding businesses.
    
    https://www.ksbdc.org The Kentucky Small Business Development Centers provide the Commonwealth of Kentucky's entrepreneurs and small businesses with the high
    quality one-on-one management consulting, educational training, and business
    information they need to maximize their growth in today's intensely competitive
    global economy.
    
    www.smalltownmarketing.com/ This site specializing in small town retail businesses, offers money-saving marketing, advertising and promotional ideas. It has more than 300 Web pages of tips for small business success. This is a great site.
    
    www.score.org The Service Corps of Retired Executives (SCORE) offers free tips, resources and expert how-to articles and profiles of small business owners who are achieving success with help from SCORE. Their “Get Email Counseling” lets you access advice electronically. Retired and active business owners and executives generally answer questions sent to them within 48 hours. Their real-world experience is an excellent resource.
    
    Last week twenty people met to talk about the future of Beattyville’s downtown business district. They discussed the need for sprucing up the downtown and the resources that are available from Frankfort and beyond. The Kentucky Renaissance program offers an excellent path for doing just that. In order to get started with that program, we need your help. The next meeting of this group will be February 7th, at 7:00 p.m. at the fire station. Every business in town should be there. A vital downtown is made up of healthy businesses. This group can help achieve both.
    
    

    ---

    Main Street Revitalization in Beattyville (2 of 12)   Posted: April 30, 2002
    Get Ready. Company’s Coming!
    
    Second of twelve articles first appearing in the "Three Forks Tradition" newspaper
    
    By: Larrey Riddle
    
    In my last column I discussed the potential for regional tourism and the role a vital downtown for Beattyville plays in developing that industry locally. The rewards for successful Main Street program to a community are great: increased revenue, new job generation, rehabilitation of buildings, a healthier business environment, and more visitors. The National Main Street Project (www.mainst.org) offers a blueprint for successful Main Street revitalization. They have found that successes are based on a comprehensive strategy of work, tailored to the needs and opportunities in each community, in four broad areas, called the Main Street Four Point Approach. They include these elements:
    
    Organization: Building consensus and cooperation among the many groups and individuals who have a role in the revitalization process.
    
    Design: Enhancing the physical appearance of the commercial district by rehabilitating historic buildings, encouraging supportive new construction, developing sensitive design management systems, and long-term planning.
    
    Promotion: Marketing the traditional commercial district's assets to customers, potential investors, new businesses, local citizens and visitors.
    
    Economic Restructuring: Strengthening the district's existing economic base while finding ways to expand it to meet new opportunities – and challenges from outlying development.
    
    The National Main Street Center's experience in helping communities bring their downtowns back to life has shown repeatedly that the Main Street Four Point Approach succeeds only when combined with the following eight principles:
    
    The plan for Main Street must be comprehensive: A single project cannot revitalize a downtown or commercial neighborhood. An ongoing series of initiatives is vital to build community support and create lasting progress.
    
    Work is accomplished one step at a time: Small projects make a big difference. They demonstrate that "things are happening" on Main Street and hone the skills and confidence the program will need to tackle more complex problems.
    
    The process should be action oriented: Frequent, visible changes in the look and activities of the commercial district will reinforce the perception of positive change. Small, but dramatic improvements early in the process will remind the community that the revitalization effort is under way.
    
    The program must be driven by the community: Although the National Main Street Center or the Kentucky Main Street program can provide valuable direction and hands-on technical assistance, only local leadership can initiate long-term success by fostering and demonstrating community involvement and commitment to the revitalization effort.
    
    There must be a public/private partnership: Every local Main Street program needs the support and expertise of both the public and private sectors. For an effective partnership, each must recognize the strengths and weaknesses of the other.
    
    The plan must identify and capitalize on existing assets: One of the National Main Street Center's key goals is to help communities recognize and make the best use of their unique offerings. Local assets provide the solid foundation for a successful Main Street initiative.
    
    There must be a commitment to quality: From storefront design to promotional campaigns to special events, quality must be the main goal.
    
    Change is difficult, but can be accomplished: Changing community attitudes and habits are essential to bring about a commercial district renaissance. A carefully planned Main Street program will help shift public perceptions and practices to support and sustain the revitalization process.
    
    

    ---

    Listen to the BOWL CoRA meetings: 4-15-02   Posted: April 20, 2002
    4-15-02

    The BOWL CoRA is the Renewal Community Oversight Comittee for Breathitt, Owsley, Lee & Wolfe Counties, Kentucky

    
    Download Part 1 first (about 5 minutes on a modem line), and then pull down the rest while you listen. Click on the "Part #" to download. Part 1, Part 2, Part 3, Part 4, Part 5, Part 6
    Part 7, Part 8, Part 9
    

    ---

    The meeting sound files are low fidelity MP3's. The file names are MMDDYY.part#.mp3, that is the month, day and year, of the meeting and then the sequence number of the file, ie: part 1, part 2, etc.

    The files are sized to download quickly and to fit on a floppy diskette. You can bring down the first file in less than 5 minutes. While listening to the first part of the meeting, you can download the remaining files.

    Use any MP3 player to listen to the meeting files. Common players are the Windows (c) Media Player, FreeAmp, Xmms, and any of the standalone players like the Rio.

    Please forgive the sound quality, and the occaisional pops, warbles and dropouts-MP3's are a "lossey" compression technology and many compromises are made to make the files this small.

    Bits of the meeting are not recorded, for example: flipping tapes, lunches, long silences, pre and post meeting discussions.
    

    ---

    Intoduction to Appal.org   Posted: April 17, 2002
    

    Introduction to Appal.org

    Basic Design

    The Posting Date is Not the Date Something Was Written.

    Search

    Categories of Information in the Top (Main) Menu

    The Bottom Menu

    ---

    Basic Design

    The website has a common look and feel. Each page has a menu at the top and bottom. Pages generally have a list of links or headlines running down the left side. Clicking on these will bring up the full text of the posted article. The site has been crafted to load quickly and retain it's basic look from computer to computer.

    The Posting Date is Not the Date Something Was Written.

    Appal.org is constructed much like a newspaper. Information is listed in chronological order by the date it is posted. It is important to note that the posting date has nothing to do with when an article was written. Because items are listed in the order they are posted, information gets buried over time, and you may need to search for it.

    Search

    You can search within the website, or across the Internet. You may also browse the headlines. The most effective means to find something on the site is to use the Search button, type in some keywords and press Enter. That will fetch all documents contain any of the words you've searched for. Once that page has loaded, use your browser's search/find within page (usually the Ctrl-F key pair) to look within the page for your query. Again, it is a two step process where you search up a list of documents, and then find your keywords within that document.

    The Search button can be found at the top and the bottom of every page. The top link opens up a page of search options, and the bottom link immediately searches within the Appal.org website. The top search button offers to search within Appal.org, to Browse all headlines, go to Google search, or go to Google's Usenet Discussion Group search.

    Categories of Information in the Top (Main) Menu

    The Main Menu at the top of each page links to categories of information. Each category is a page a lot like the starting page, although the number of columns may vary. Each posted article has a headline that links you to the full text, and a lead paragraph or two that briefly introduces the article.

    The categories are pretty ambiguous, so it is not always clear where an article is posted. However, every article, regardless of category, is listed in the headline column (the grey list on the left of the starting page). Items are eventually pushed off the bottom as only the most recent 50 items are displayed.

    Some categories are explicit, however. If the information is a sound file or involves a lot of pictures, you'll find it in the Gallery & Auditorium. The Help/HOWTO contains documents like this one that explain how to use the site. The Search button has been described already. Contact information is the email and mail address. The Public Forums are 'chat rooms'. They may be moderated to keep Appal.org within the bounds of our ISP, applicable law, and polite conversation. The Links page has lists of related links. All the other pages listed in the Main Menu are more general.

    The Bottom Menu

    The bottom of each page has a Search button, a Browse button and a grey bar containing links. The Search button, described above, wil pull up all documents containing any of the words you key in. The Browse button brings up a list of all headlines ever posted on the site. You can scroll through that list, or use your browser's Find button (usually Ctrl-F) to locate a headline by keyword.

    The grey bar has links for Private Meetings (invitation only), Privacy Policy, Webmaster & Acknowledgments, and Submit Photos and Articles. The Private Meetings link launches a password protected chat room, identical to the Public Forum. The Privacy Policy is Appal.org's rules for operating the website. The Webmaster page lists the programmers and coders who built the site and it components.

    The Submit Photos and Articles link offers anyone a means to send information for possible posting on Appal.org. If you take advantage of this feature, please email also, and describe the information. There are size limits on the available storage which may cause your submission to fail without notice, so please email ap@appal.org if it is important to you to have the information listed here. There is no assurance that your information will be posted, however. It may be rejected for any reason.

    The Submit step is too complicated to be called easy. If you prefer, you can email your submission instead.

    
    

    ---

    Listen to the BOWL CoRA meetings: 3-27-02   Posted: April 14, 2002
    3-27-02
    

    The BOWL CoRA is the Renewal Community Oversight Comittee for Breathitt, Owsley, Lee & Wolfe Counties, Kentucky
    

    
    Download Part 1 first (about 5 minutes on a modem line), and then pull down the rest while you listen.
    Click on the "Part #" to download.
    Part 1, Part 2, Part 3, Part 4, Part 5, Part 6

    ---

    The meeting sound files are low fidelity MP3's. The file names are YYMMDD.part#.mp3, that is the year, month and day of the meeting and then the sequence number of the file, ie: part 1, part 2, etc.
    
    
    The files are sized to download quickly and to fit on a floppy diskette. You can bring down the first file in less than 5 minutes. While listening to the first part of the meeting, you can download the remaining files.
    
    
    Use any MP3 player to listen to the meeting files. Common players are the Windows (c) Media Player, FreeAmp, Xmms, and any of the standalone players like the Rio.
    
    
    Please forgive the sound quality, and the occaisional pops, warbles and dropouts-MP3's are a "lossey" compression technology and many compromises are made to make the files this small.
    
    
    Bits of the meeting are not recorded, for example: flipping tapes, lunches, pre and post meeting discussions.
    
    

    ---

    Wolfe County   Posted: April 14, 2002
    Campton, Kentucky
    Campton, Kentucky Scanner Frequencies
    Natural Bridge State Resort Park
    Wolfe County Board of Education
    Campton: Commonwealth of Kentucky Cabinet for Families and Children
    Red River Gorge Online

    ---

    County History and Genealogy   Posted: April 14, 2002
    Kentucky Genealogy Web: genealogy, newspapers, magazines.

    ---

    Lee County   Posted: April 14, 2002
    Welcome To The City Of Beattyville Kentucky
    Weather Underground: Beattyville, Kentucky Forecast
    Kentucky Atlas Kentucky Gazetteer County Information
    Kiwanis Club of Beattyville, Kentucky
    Lee County Kentucky Genealogy
    North Fork Kentucky River at Heidelberg
    Beattyville, Kentucky Scanner Frequencies
    Lee Adjustment Center
    Lee County Schools
    Golf Course Guide: Beattyville Country Club

    ---

    Kentucky Sites   Posted: April 14, 2002
    Kentucky Legislature Home Page
    The Ky Legislative Record On-Line
    Ky Div. of Water
    Ky Secretary of State
    The Univ. of Kentucky Directory
    League of Women Voters of Ky
    Kentuckians for The Commonwealth
    Kentucky Resources Council
    Kentucky Automated Flood Warning System
    Photo Tour of Eastern Kentucky Dumps
    ARC Corridors
    The Appalshop &   WMMT Radio

    ---

    Owsley County   Posted: April 14, 2002
    Booneville, Kentucky
    South Fork Kentucky River at Booneville
    Owlsey County Kentucky: rental assistance for low-income households
    Owsley County Ky Genealogy
    KY Cabinet for Health Services
    Kentucky Dept of Education: Owsley County

    ---

    Breathitt County   Posted: April 14, 2002
    National Weather Service Jackson Kentucky
    Jackson, Kentucky
    BREATHITT COUNTY PUBLIC LIBRARY
    Jackson, Kentucky: Coal Town
    Jackson, Kentucky Scanner Frequencies

    ---

    CONFERENCE REPORT ON H.R. 4577, COMMUNITY RENEWAL TAX RELIEF ACT OF 2000   Posted: April 13, 2002
    2000CRH12355 [[pp. H12355-H12405]] CONFERENCE REPORT ON H.R. 4577, DEPARTMENTS OF LABOR, HEALTH AND HUMAN, Part 10/10

    COMMUNITY RENEWAL TAX RELIEF ACT OF 2000

    18 Dec, 2000 Following is explanatory language on H.R. 5662, as introduced on December 14, 2000. The conferees on H.R. 4577 agree with the matter included in H.R. 5659 and enacted in this conference report by reference and the following description of it.

    TITLE I. COMMUNITY RENEWAL PROVISIONS

    A. Renewal Community Provisions (secs. 101-102 of the bill and secs. 51, 469, and new secs. 1400E-J of the Code)

    Present Law

    In recent years, provisions have been added to the Internal Revenue Code that target specific geographic areas for special Federal income tax treatment. For example, empowerment zones and enterprise communities generally provide tax incentives for businesses that locate within certain geographic areas designated by the Secretaries of Housing and Urban Development (`HUD'') and Agriculture.

    House Bill

    No provision. However, H.R. 5542 1 authorizes the designation of 40 ``renewal communities'' within which special tax incentives would be available. The following is a description of the designation process and the tax incentives that would be available within the renewal communities. --------------------------------------------------------------------------- 1 H.R. 5542 was incorporated by reference into the conference agreement that accompanied H.R. 2614 (H. Rpt. 106- 1004), which was passed by the House of Representatives on October 26, 2000. --------------------------------------------------------------------------- Designation process Designation of 40 renewal communities.--The Secretary of HUD, 2 is authorized to designate up to 40 ``renewal communities'' from areas nominated by States and local governments. At least 12 of the designated communities must be in rural areas. Of the 12 rural renewal communities, one shall be an area within Mississippi, designated by the State of Mississippi, that includes at least one census tract within Madison County, Mississippi. --------------------------------------------------------------------------- 2 In making the designations, the Secretary of HUD must consult with the Secretaries of Agriculture, Commerce, Labor, Treasury, the Director of the Office of Management and Budget; and the Administrator of the Small Business Administration (and the Secretary of the Interior in the case of an area within an Indian reservation). --------------------------------------------------------------------------- The Secretary of HUD is required to publish (within four months after enactment) regulations describing the nomination and selection process. Designations of renewal communities are to be made during the period beginning on the first day of the first month after the regulations are published and ending on December 31, 2001. The designation of an area as a renewal community generally will be effective on January 1, 2002, and will terminate after December 31, 2009. 3 --------------------------------------------------------------------------- 3 The designation would terminate earlier than December 31, 2009, if (1) an earlier termination date is designated by the State or local government in their designation, or (2) the Secretary of HUD revokes the designation as of an earlier date. --------------------------------------------------------------------------- Elibility criteria.--To be designated as a renewal community, a nominated area must meet the following criteria: (1) each census tract must have a poverty rate of at least 20 percent, 4 (2) in the case of an urban area, at least 70 percent of the households have incomes below 80 percent of the median income of households within the local government jurisdiction; (3) the unemployment rate is at least 1.5 times the national unemployment rate; and (4) the area is one of pervasive poverty, unemployment, and general distress. Those areas with the highest average ranking of eligibility factors (1), (2), and (3) above would be designated as renewal communities. One nominated area within the District of Columbia becomes a renewal community (without regard to its ranking of eligibility factors) provided that it satisfies the area and eligibility requirements and the required State and local commitments described below. 5 The Secretary of HUD shall take into account in selecting areas for designation the extent to which such areas have a high incidence of crime, as well as whether the area has census tracts identified in the May 12, 1998, report of the General Accounting Office regarding the identification of economically distressed areas. In lieu of the poverty, income, and unemployment criteria, outmigration may be taken into account in the designation of one rural renewal community. --------------------------------------------------------------------------- 4 Determined using 1990 census data. 5 The designation of a nominated area within the District of Columbia as a renewal community becomes effective on January 1, 2003 (upon the expiration of the designation of the District of Columbia Enterprise Zone). --------------------------------------------------------------------------- There are no geographic size limitations placed on renewal communities. Instead, the boundary of a renewal community must be continuous. In addition, the renewal community must have a minimum population of 4,000 if the community is located within a metropolitan statistical area (at least 1,000 in all other cases), and a maximum population of not more than 200,000. The population limitations do not apply to any renewal community that is entirely within an Indian reservation. Required State and local commitments.--In order for an area to be designated as a renewal community, State and local governments are required to submit a written course of action in which the State and local governments promise to take at least four of the following governmental actions within the nominated area: (1) a reduction of tax rates or fees; (2) an increase in the level of efficiency of local services; (3) crime reduction strategies; (4) actions to remove or streamline governmental requirements; (5) involvement by private entities and community groups, such as to provide jobs and job training and financial assistance; and (6) the gift (or sale at below fair market value) of surplus realty by the State or local government to community organizations or private companies. In addition, the nominating State and local governments must promise to promote economic growth in the nominated area by repealing or not enforcing four of the following: (1) licensing requirements for occupations that do not ordinarily require a professional degree; (2) zoning restrictions on home-based businesses that do not create a public nuisance; (3) permit requirements for street vendors who do not create a public nuisance; (4) zoning or other restrictions that impede the formation of schools or child care centers; and (5) franchises or other restrictions on competition for businesses providing public services, including but not limited to taxicabs, jitneys, cable television, or trash hauling, unless such regulations are necessary for and well- tailored to the protection of health and safety. Empowerment zones and enterprise communities seeking designation as renewal communities.--With respect to the first 20 designations of nominated areas as renewal communities, preference will be given to nominated areas that are enterprise communities and empowerment zones under present law that otherwise meet the requirements for designation as a renewal community. An empowerment zone or enterprise community can apply for designation as a renewal community. If a renewal community designation is granted, then an area's designation as an empowerment zone enterprise community ceases as of the date the area's designation as a renewal community takes effect. Tax incentives for renewal communities The following tax incentives generally are available during the period beginning January 1, 2002, and ending December 31, 2009. 6 --------------------------------------------------------------------------- 6 If a renewal community designation is terminated prior to December 31, 2009, the tax incentives would cease to be available as of the termination date. --------------------------------------------------------------------------- Zero-percent capital gain rate.--A zero-percent capital gains rate applies with respect to gain from the sale of a qualified community asset acquired after December 31, 2001, and before January 1, 2010, and held for more than five years. A ``qualified community asset'' includes: (1) qualified community stock (meaning original-issue stock purchased for cash in a renewal community business); (2) a qualified community partnership interest (meaning a partnership interest acquired for cash in a renewal community business); (3) qualified community business property (meaning tangible property originally used in a renewal community business by the taxpayer) that is purchased or substantially improved after December 31, 2001. A ``renewal community business'' is similar to the present- law definition of an enterprise zone business. 7 Property will continue to be a qualified community asset if sold (or otherwise transferred) to a subsequent purchaser, provided that the property continues to represent an interest in (or tangible property used in) a renewal community business.

    [[Page H12405]]

    The termination of an area's status as a renewal community will not affect whether property is a qualified community asset, but any gain attributable to the period before January 1, 2002, or after December 31, 2014, will not be eligible for the zero-percent rate. --------------------------------------------------------------------------- 7 An ``enterprise zone business'' is defined in section 1397B. --------------------------------------------------------------------------- Renewal community employment credit.--A 15-percent wage credit is available to employers for the first $10,000 of qualified wages paid to each employee who (1) is a resident of the renewal community, and (2) performs substantially all employment services within the renewal community in a trade or business for the employer. The wage credit rate applies to qualifying wages paid after December 31, 2001, and before January 1, 2010. Wages that qualify for the credit are wages that are considered ``qualified zone wages'' for purposes of the empowerment zone wage credit (including coordination with the Work Opportunity Tax Credit). In general, any taxable business carrying out activities in the renewal community may claim the wage credit. Commercial revitalization deduction.--Each State is permitted to allocate up to $12 million of ``commercial revitalization expenditures'' to each renewal community located within the State for each calendar year after 2001 and before 2010. The appropriate State agency will make the allocations pursuant to a qualified allocation plan. A ``commercial revitalization expenditure'' means the cost of a new building or the cost of substantially rehabilitating an existing building. The building must be used for commercial purposes and be located in a renewal community. In the case of the rehabilitation of an existing building, the cost of acquiring the building will be treated as qualifying expenditures only to the extent that such costs do not exceed 30 percent of the other rehabilitation expenditures. The qualifying expenditures for any building cannot exceed $10 million. A taxpayer can elect either to (a) deduct one-half of the commercial revitalization expenditures for the taxable year the building is placed in service or (b) amortize all the expenditures ratably over the 120-month period beginning with the month the building is placed in service. No depreciation is allowed for amounts deducted under this provision. The adjusted basis is reduced by the amount of the commercial revitalization deduction, and the deduction is treated as a depreciation deduction in applying the depreciation recapture rules (e.g., sec. 1250). The commercial revitalization deduction is treated in the same manner as the low-income housing credit in applying the passive loss rules (sec. 469). Thus, up to $25,000 of deductions (together with the other deductions and credits not subject to the passive loss limitation by reason of section 469(i)) are allowed to an individual taxpayer regardless of the taxpayer's adjusted gross income. The commercial revitalization deduction is allowed in computing a taxpayer's alternative minimum taxable income. Additional section 179 expensing.--A renewal community business is allowed an additional $35,000 of section 179 expensing for qualified renewal property placed in service after December 31, 2001, and before January 1, 2010. The section 179 expensing allowed to a taxpayer is phased out by the amount by which 50 percent of the cost of qualified renewal property placed in service during the year by the taxpayer exceeds $200,000. The term ``qualified renewal property'' is similar to the definition of ``qualified zone property'' used in connection with empowerment zones. Extension of work opportunity tax credit (``WOTC'').--The bill expands the high-risk youth and qualified summer youth categories in the WOTC to include qualified individuals who live in a renewal community. GAO report The General Accounting Office will audit and report to Congress on January 31, 2004, and again in 2007 and 2010, on the renewal community program and its effect on poverty, unemployment, and economic growth within the designated renewal communities. Effective date Renewal communities must be designated during the period beginning on the first day of the first month after the publication of regulations by HUD and ending on December 31, 2001, The tax benefits available in renewal communities are effective for the period beginning January 1, 2002, and ending December 31, 2009.

    Senate Amendment

    No provision. However, S. 3152 8 authorizes the Secretaries of HUD and Agriculture to designate up to 30 renewal zones from areas nominated by States and local governments. At least six of the designated renewal zones must be in rural areas. The Secretary of HUD is required to publish (within four months after enactment) regulations describing the nomination and selection process. Designations of renewal zones must be made before January 1, 2002, and the designations are effective for the period beginning on January 1, 2002 through December 31, 2009. --------------------------------------------------------------------------- 8 S. 3152 was introduced by Senator Roth and others on October 3, 2000. --------------------------------------------------------------------------- The eligibility criteria (as well as the population and geographic limitations) are similar to those for renewal communities in the House bill, except that S. 3152 provides that any State without any empowerment zone would be given priority in the designation process. Also, the designations of renewal zones must result in (after taking into account existing empowerment zones) each State having at least one zone designation (empowerment or renewal zone). In addition, S. 3152 provides that, in lieu of the poverty, income, and unemployment criteria, outmigration may be taken into account in the designation of one rural renewal zone. Under a separate provision in S. 3152, the designation of the District of Columbia Enterprise Zone is entended through December 31, 2006. In order for an area to be designated as a renewal zone, State and local governments are required to submit a written course of action in which the State and local governments promise to take at least four of the governmental actions described in the House bill with respect to renewal communities. However, S. 3152 does not contain any of the economic growth provision requirements described in the House bill. Tax incentives for renewal zones.--Under S. 3152, businesses in renewal zones would be eligible for the following tax incentives during the period beginning January 1, 2002 and ending December 31, 2009: (1) a zero-percent capital gains rate for qualifying assets limited to an aggregate amount not to exceed $25 million of gain per taxpayer; 9 (2) a 15-percent wage credit for the first $15,000 of qualifying wages; (3) $35,000 in additional 179 expensing for qualifying property; (4) and the enhanced tax- exempt bond rules that currently apply to businesses in the Round II empowerment zones. --------------------------------------------------------------------------- 9 Any gain attributable to the period before January 1, 2002, or after December 31, 2014, would not be eligible for the zero-percent capital gains rate. --------------------------------------------------------------------------- GAO report.--The General Accounting Office will audit and report to Congress every three years (beginning on January 31, 2004) on the renewal zone program and its effect on poverty, unemployment, and economic growth within the designated renewal zones. Effective date.--The 30 renewal zones must be designated by January 1, 2002, and the tax benefits are available for the period beginning January 1, 2002, and ending December 31, 2009.

    Conference Agreement

    The conference agreement follows H.R. 5542 with the following modifications. The conference agreement does not include the rural renewal community designation with respect to an area within the State of Mississippi. The conference agreement does not include the special rule that provides that one nominated area within the District of Columbia becomes a renewal community (without regard to its ranking of eligibility factors).

    B. Empowerment Zone Tax Incentives

    1. Extension and expansion of empowerment zones (secs. 111- 115 of the bill and secs. 1391, 1394, 1396, and 1397A of the Code)

    PRESENT LAW

    Round I empowerment zones The Omnibus Budget reconciliation Act of 1993 (``OBRA 1993'') authorized the designation of nine empowerment zones (``Round I empowerment zones'') to provide tax incentives for businesses to locate within targeted areas designated by the Secretaries of HUD and Agriculture. The Taxpayer Relief Act of 1997 (``1997 Act'') authorized the designation of two additional Round I urban empowerment zones. Businesses in the 11 Round I empowerment zones qualify for the following tax incentives: (1) a 20-percent wage credit for the first $15,000 of wages paid to a zone resident who works in the empowerment zone, 10 (2) an additional $20,000 of section 179 expensing for qualifying zone property, and (3) tax-exempt financing for certain qualifying zone facilities. The tax incentives with respect to the empowerment zones designated by OBRA 1993 generally are available during the 10-year period of 1995 through 2004. The tax incentives with respect to the two additional Round I empowerment zones generally are available during the 10-year period of 2000 through 2009. 11 --------------------------------------------------------------------------- 10 For wages paid in calendar years during the period 1994 through 2001, the credit rate is 20 percent. The credit rate is reduced to 15 percent for calendar year 2002, 10 percent for calendar year 2003, and 5 percent for calendar year 2004. No wage credit is available after 2004 in the original nine empowerment zones. 11 Except for the wage credit, which is reduced to 15 percent for calendar year 2005, and then reduced by five percentage points in each year in 2006 and 2007, with no wage credit available after 2007. --------------------------------------------------------------------------- Round II empowerment zones The 1997 Act also authorized the designation of 20 additional empowerment zones (``Round II empowerment zones''), of which 15 are located in urban areas and five are located in rural areas. Businesses in the Round II empowerment zones are not eligible for the wage credit, but are eligible to receive up to $20,000 of additional section 179 expensing. Businesses in the Round II empowerment zones also are eligible for more generous tax-exempt financing benefits than those available in the Round I empowerment zones. Specifically, the tax-exempt financing benefits for the Round II empowerment zones are not subject to the State private activity bond volume caps (but are subject to separate per-zone volume limitations), and the per-business size limitations that apply to the Round I empowerment zones and enterprise communities (i.e., $3 million for each qualified enterprise zone business with a maximum of $20 million for each principal user for all zones and communities) do not apply to qualifying bonds issued for Round II empowerment zones. The tax incentives with respect to the Round II empowerment zones generally are available during the 10-year period of 1999 through 2008.

    
    

    ---

    Proposed bill to allow a credit against income tax for information technology training expenses in RC's   Posted: April 13, 2002
    Archive-Name: gov/us/fed/congress/record/2001/apr/24/2001CRS3855A/part1
    Message-ID: <2001CRS3855A@us.govnews.org>
    MIME-Version: 1.0
    
    [Congressional Record: April 24, 2001 (Senate)]
    [Page S3855-S3864]
    From the Congressional Record Online via GPO Access [wais.access.gpo.gov]
    [DOCID:cr24ap01-217]
    
    
    
    

    S. 762. A bill to amend the Internal Revenue Code of 1986 to allow a credit against income tax for information technology training expenses and for other purposes; to the Committee on Finance. Mr. CONRAD. Mr. President, during the final months of the 106th Congress, the Senate and House completed action on the American Competitiveness in the 21st Century Act which will respond to the shortage of skilled IT workers and help ensure our nation's continued growth and leadership in the information technology field. Congress increased the cap on the number of H1B visas available for foreign workers with high-tech skills to fill the job vacancies in information technology in the US. As important as action by Congress to permit companies to hire foreign-born skilled IT workers is, this legislation by itself will not address our long-term IT worker needs. Throughout the recent debate on the IT worker shortage, I have urged that we focus our efforts on IT training and partnerships between the business and education communities. Many excellent partnerships between the IT community, state and local government, high schools, and colleges and universities that provide individuals of all ages with education and training opportunities in information technology are already underway. ... I ask unanimous consent that the text of this legislation along with statements of endorsement for the Technology Education and Training Act from the Technology Workforce Coalition, the Information Technology Association of America, and the American Society for Training and Development be printed in the Record. There being no objection, the material was ordered to be printed in the Record, as follows:

    S. 762

    Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

    SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Technology Education and Training Act of 2001''.

    SEC. 2. CREDIT FOR INFORMATION TECHNOLOGY TRAINING PROGRAM EXPENSES.

    (a) In General.--Subpart B of part IV of subchapter A of chapter 1 of the Internal Revenue Code of 1986 is amended by adding at the end the following:

    ``SEC. 30B. INFORMATION TECHNOLOGY TRAINING PROGRAM EXPENSES.

    ``(a) General Rule.--In the case of a taxpayer engaged in a trade or business during the taxable year, there shall be allowed as a credit against the tax imposed by this chapter for such taxable year an amount equal to 100 percent of information technology training program expenses of the taxpayer and any employee of the taxpayer paid or incurred by the taxpayer during such taxable year. ``(b) Limitation.-- ``(1) In general.--The amount of information technology training program expenses with respect to any individual which may be taken into account under subsection (a) for the taxable year shall not exceed $1,500. ``(2) Increase in credit amount for participation in certain programs and for certain individuals.--The dollar amount in paragraph (1) shall be increased (but not above $2,000) by the amount of information technology training program expenses paid or incurred by the taxpayer-- ``(A) with respect to a program operated-- ``(i) in an empowerment zone or enterprise community designated under part I of subchapter U or a renewal community designated under part I of subchapter X, ``(ii) in a school district in which at least 50 percent of the students attending schools in such district are eligible for free or reduced-cost lunches under the school lunch program established under the National School Lunch Act, ``(iii) in an area designated as a disaster area by the Secretary of Agriculture or by the President under the Disaster Relief and Emergency Assistance Act in the taxable year or the 4 preceding taxable years, ``(iv) in a rural enterprise community designated under section 766 of the Agriculture, Rural Development, Food and Drug Administration, and Related Agencies Appropriations Act, 1999, ``(v) in an area designated by the Secretary of Agriculture as a Rural Economic Area Partnership Zone, ``(vi) in an area over which an Indian tribal government (as defined in section 7701(a)(40)) has jurisdiction, or ``(vii) by an employer who has 200 or fewer employees for each business day in each of 20 or more calendar weeks in the current or preceding calendar year, or ``(B) in the case of an individual with a disability. ``(c) Information Technology Training Program Expenses.-- For purposes of this section-- ``(1) In general.--The term `information technology training program expenses' means expenses paid or incurred by reason of the participation of the taxpayer (or any employee of the taxpayer) in any information technology training program if such expenses lead to an industry-accepted information technology certification for the participant. Such term shall only include includes expenses paid for in connection with course work and certification testing which is essential to assessing skill acquisition. ``(2) Information technology training program.--The term `information technology training program' means a program for an industry-accepted information technology certification--

    [[Page S3858]]

    ``(A) by any information technology trade association or corporation, and ``(B) which-- ``(i) is provided for the employees of such association or corporation, or ``(ii) involves--

    ``(I) employers, and ``(II) State training programs, school districts, university systems, higher education institutions (as defined in section 101(b) of the Higher Education Act of 1965), or certified commercial information technology training providers.

    ``(3) Certified commercial information technology training provider.-- ``(A) In general.--The term `certified commercial information technology training provider' means a private sector organization providing an information technology training program which leads to an approved information technology industry certification for the participants. ``(B) Approved industry certification.--For purposes of paragraph (1), an information technology industry certification shall be considered approved if such certification is approved by the Secretary, in consultation with the Information Technology Training Certification Advisory Board. ``(d) Denial of Double Benefit.--No deduction or credit under any other provision of this chapter shall be allowed with respect to information technology training program expenses taken into account for the credit under this section. ``(e) Certain rules made applicable.--For purposes of this section, rules similar to the rules of section 45A(e)(2) and subsections (c), (d), and (e) of section 52 shall apply. ``(f) Application With Other Credits.--The credit allowed by subsection (a) for any taxable year shall not exceed the excess (if any) of-- ``(1) the regular tax for the taxable year reduced by the sum of the credits allowable under the subpart A and the previous sections of this subpart, over ``(2) the tentative minimum tax for the taxable year.''. (b) Clerical Amendment.--The table of sections for subpart B of part IV of subchapter A of chapter 1 of the Internal Revenue Code of 1986 is amended by adding at the end the following:

    ``Sec. 30B. Information technology training program expenses.''. (c) Effective Date.--The amendments made by this section shall apply to amounts paid or incurred in taxable years beginning after December 31, 2001.

    
    

    ---

    NATIONAL ECONOMIC ADVISOR GENE SPERLING ON NEW MARKETS INITIATIVE AGREEMENT   Posted: April 13, 2002
    THE WHITE HOUSE

    Office of the Press Secretary ________________________________________________________________________ For Immediate Release May 23, 2000

    PRESS BRIEFING BY NATIONAL ECONOMIC ADVISOR GENE SPERLING ON NEW MARKETS INITIATIVE AGREEMENT

    The James S. Brady Press Briefing Room

    10:25 A.M. EDT

    MR. DORTON: Today we have National Economic Advisor Gene Sperling to give an on the record briefing about the landmark New Markets Renewal Communities Agreement between President Clinton and Speaker Hastert.

    MR. SPERLING: Last night, the President and Speaker reached a landmark agreement on bringing capital and opportunity to America's untapped markets. As you recall, the Speaker had joined the President in November on the last leg of the President's second New Markets trip, and they had pledged to work together on bipartisan legislation. They shook hands on that, as you'll recall, at the State of the Union.

    Over the last three to four months, we have been engaged in extensive negotiations with the Speaker's office, as well as with the House Ways and Means Committee, with J.C. Watts and Jim Talent, and members of the Black and Hispanic Caucus in the House of Representatives. The agreement that is reached is bold, comprehensive, and again, would mark an unprecedented commitment to bringing new incentives for capital investment in America's distressed and lower-income communities.

    Let me describe the key elements. First of all, on the President's New Markets initiatives that he announced, the New Markets tax credit, which would be up to a 30 percent credit on investment in funds that invest in low-income areas, would be part of this agreement. This was the central tax piece, part of the President's New Market agenda. Secondly, also agreed to was the America's Private Investment Companies, APIC, which is meant to be the domestic component of our domestic counterpart of OPIC -- would provide for larger venture capital investments in distressed economic areas of our country.

    The basic design is that where somebody raises a dollar, or let's say, raises $1 million, they are able to get a two-to-one match from the government in guaranteed lending. So, if somebody is able to raise $1 million, the government provides them $2 million of government-guaranteed lending. So, what this does is an incentive to raise equity capital in low-income areas, because for every dollar that's raised, you get $2 of preferred, cheaper financing.

    The reason why this model has worked well in the OPIC context and has worked well in the SBIC -- Small Business Investment Company -- context is even though it is a very significant incentive to raise funds, the investors have to lose all their money before the government loses any of its money. And that has aligned the incentives in a way in which there has been very, very little loss to the government from this model. So, that is what the American Private Investment Companies -- or APICs -- does.

    The third component of the New Markets package the President put forward was the New Market Venture Capital firms. This is similar to the APICs, except that it is designed to deal with smaller start-up, entrepreneurial firms, and allow them the kind of managerial assistance they need to get off the ground and get started.

    Yesterday, when President Mbeki was here, we had Ray Moncrief from Kentucky Highlands, and Bill Bynum from the Economic Development Corporation in the Mississippi Delta. They are two of the leading examples of non-profits that help these kind of start-up companies in low-income areas. So that is one component. These three parts are the President's New Market initiative.

    Secondly, there is a significant strengthening and expansion of the existing empowerment zones. Currently -- just to give you a little background on empowerment zones -- there were nine initial empowerment zones in the 1993 budget agreement. That was extended to 11 in the next year. Then, in 1997, 20 empowerment zones were added in the 1997 Balanced Budget Agreement.

    So there are currently 31 empowerment zones, but the last 20 had never gotten the main tax incentive that the first nine had, which is a wage credit, which is very significant. It gives a wage credit of 20 percent of the first $15,000 in wages. So for any employee in an empowerment zone, their employer is able to get a $3,000 credit on the first $15,000 of wages. So it's a significant incentive to locate and to hire people in empowerment zones. That wage credit only existed in the initial nine empowerment zones; that will now exist for all 31 empowerment zones.

    Also, all the empowerment zones will now have a zero capital gains rollover provision. And what that allows for is for capital gains made within the empowerment zones to be able to be rolled over with no taxes when the investment is put back into the empowerment zones. In addition, there will be a 60-percent capital gains exclusion for investment in small business in the empowerment zones.

    So that is what is being done to strengthen the existing 31. Then there will be a new round of empowerment zones, of nine, that will take the total empowerment zones to 40.

    The other major component of this is the renewal community proposal, which has been sponsored by J.C Watts, Jim Talent and Danny Davis -- J.C. Watts and Jim Talent are obviously prominent Republican members of Congress; Danny Davis is a Democrat from Illinois. The three of them have had a renewal community proposal for several years. Speaker Hastert has also championed it. This was what he asked us to work with in agreement for doing the provisions the President proposed.

    The renewal communities are a form of empowerment zones, but have a slightly different form and a slightly different vision in that it relies on more incentives for streamlining and regulatory relief, and while it does not have as generous a wage credit as the empowerment zones, it does have a wage credit of 15 percent on the first $10,000. So while the credit in the empowerment zones could go up to $3,000, the wage credit in the renewal community could go up to $1,500.

    It also has a zero capital gains rate for investments in companies, commercial real estate, as exists now for D.C. What the Speaker and Mr. Talent and Mr. Watts wanted was to have the same zero capital gains incentive that's in D.C. exist for the other 40 renewal communities.

    Several members of the Black Caucus, including Chairman Clyburn and Representative Jefferson and Rangel also were entrusted in having different forms of capital gains relief in the renewal communities and empowerment zones. They also would have a commercial revitalization tax credit for taxpayers who rehabilitate or revitalize buildings in the renewal community.

    So, the incentives between the empowerment zones and the renewal communities are balanced; they take a somewhat different form; there will be 40 renewal communities. So, where now there are 31 zones, this would grow now to 80. And we allow for two different forums to see what we can learn over the next several years about what works best in attracting investment and job growth.

    In addition, there will be an expansion of the low-income housing tax credit. It will be expanded by more than 40 percent to build an additional 180,000 units of affordable housing for working families over the next five years. This had broad bipartisan support. We're very happy that the Speaker agreed to have this in the agreement.

    Finally, a provision that was very important to particularly Congressman J.C. Watts was to allow faith-based organizations to qualify for substance abuse funding. This initiative would allow faith-based organizations who provide prevention and treatment programs to qualify on an equal basis with other non-profits, consistent with the 1996 Welfare Reform Act and the constitutional provisions that are relevant.

    So, again, this has been an effort that has involved many, many people on both sides. On the Democratic side, Chairman Rangel, Mr. Clyburn; Roybal-Allard from the Hispanic Caucus, Sarah Jefferson -- many people; J.C. Watts and Jim Talent on the Republican side. I want to personally thank Ralph Hellman and Kiki Kless in the Speaker's Office for their good-faith negotiations over the last few months. And I'm happy to take any questions.

    Q How much money is involved here? How much money in federal credits, and is there any direct payment to the --

    MR. SPERLING: In terms of the budget costs, we are still doing a final estimate. My guess would be that over five years, this would be between $5 billion and $7 billion; and over 10 years, it would be probably close to $20 billion of costs to -- in terms of the federal budget cost.

    But what's significant about this is the degree that this would leverage new investment. We believe the New Markets part alone would leverage up to $20 billion of investment. So, this is -- almost all of this investment is in the form of incentives that leverage additional private capital. So when you look at it in that context, it really is a historic agreement in terms of incentives to leverage private capital and to low-income areas.

    Q In budget terms, how does that compare to what the President had been proposing? And would there be any offsets, or is it just in the scope of the budgets going forward would be accounted for?

    MR. SPERLING: This is obviously larger than -- in terms of the low-income incentives, because it really includes the President's entire empowerment zone proposals, and his New Markets proposals. And it adds the renewal community. So I think when you're doing a bipartisan compromise, there's two ways you can do it. One is, you can both kind of trim down each other's packages; or you can try to work to include, really, the core of both ideas. That was -- the latter's the path we chose, and so obviously, as it includes some of their ideas and our ideas, the package is larger than either the Speaker's or the President's initiatives was alone.

    Q Is it about twice as big or three times as big or just slightly larger -- do you have any --

    MR. SPERLING: I would guess that our initiatives would have been $10 or $12 billion, and this probably added $5 or $6 billion on things that were important to them. That's over 10 -- I'm sorry -- the Republicans tend to focus on five-year numbers in their estimates, and I think the cost, obviously, because it doesn't start up as fast, would be less over the first five years, probably. We were aiming for $5 billion; it probably came in closer to $6 or $7 billion.

    Q Gene, a lot of the stuff here are things we first saw last summer, I guess, when we went to Kentucky and the Delta and around --

    MR. SPERLING: Right.

    Q -- what are the major programmatic concessions here to the Republicans besides the faith-based substance abuse training?

    MR. SPERLING: What are the concessions that we made?

    Q Right. Which of this can they call their own, or which of these things are the ones that --

    MR. SPERLING: I think the renewal community, the whole renewal community program -- well, let me make a comment. Just getting off the phone with the Speaker's office again, I really think what's very good about this initiative, unlike other compromises I've been in, is that I really believe both sides believe everything in this is positive. These reflect different ideas of reaching the same goal, which is using incentives to leverage private sector capital and private sector investment in lower-income areas and new markets.

    This, for us, reflects the Third Way approach the President wanted for poor urban and rural areas, which was neither a laissez-faire approach, nor a direct, top-down government spending approach, but incentives that would encourage the private sector to find profits and create opportunities there.

    So I think when you look at the 1997 Balanced Budget Agreement, I think there were clearly things in that package we did not like that we went along with as a means of getting the children's health package and other things. I think there were some things here that will be more controversial on our side and that were a little more difficult for us to agree with. But I think in the end we both felt good about it.

    I think the renewal communities was, in a sense, I think they saw it as their version of empowerment zones. And they never meant -- and to their credit, they never meant to take the place of empowerment zones, they always wanted to do this in addition to empowerment zones as another way of using a slightly different set of incentives.

    The zero capital gains tax rate was something that the Speaker pushed very hard for, and the agreement on the faith-based organizations providing drug treatment -- these were two things that were important to them and those were some of the things that came down to the end. For us, one thing I may not have mentioned was the second round empowerment zones had never received the funding that we had initially designed for them. They have agreed to do $200 million of funding, appropriations funding, for the 20 empowerment zones that had not gotten the funding. That was very important to us, because obviously the many mayors with empowerment zones felt we shouldn't go on and expand programs until we made whole the pledges made to them.

    Getting the New Market tax credit as we proposed it was very important to us. That was a centerpiece of the President's New Markets Initiative, and we very much also wanted to see the low-income housing tax credit included. In the end, those three issues came together with the zero capital gains and the faith-based institutions. And on the faith-based institutions, a lot of that was just careful, painstaking exchanges of drafts until we were able to find something that met the goals of the Republicans and J.C. Watts, but also pass the constitutional test with our Justice Department and the policy test with our HHS.

    Q Gene, on the faith-based, what kind of safeguards will there be? As you know, this has been controversial, especially in Texas where it's had questionable success and has been criticized -- there's been criticism that some of the religious groups have crossed the line and used this opportunity to try to spread their beliefs.

    MR. SPERLING: What I would say is that our goal was to not go beyond what was in the 1996 Welfare Reform Act, or what was in -- I think Senator Frist's legislation in the Senate that passed by an overwhelming bipartisan vote. All I can tell you is that we were clearly concerned with those issues. We worked in good faith with the Speaker's Office, with our HHS and Justice Departments to make sure that this was something that clearly was acceptable constitutionally. And our goal -- what we were agreeing to was to simply not put them in a worse position than another non-profit and to ensure that the basic constitutional safeguards were met.

    And I think the provisions in the language that were in the '96 Welfare Reform and would be in this, we believe would meet that test.

    Q Can those safeguards really be assured, though, when they get down to the basic local level?

    MR. SPERLING: I think this was something, again, was very important to the Speaker's office. We felt that -- one of the provisions that is in here is that in order for a faith-based organization that has a drug clinic prevention, they have to establish three years of success before they're allowed. So a state is able to certify that they've been in existence -- not just in existence, but that they've been successful for three years. So I think that gives the individual states an ability to look closely at who they're giving the money for, and I think that they were mindful of those concerns. And I think having the three years success requirement provides, we hope, a significant safeguard.

    Q The report on the financial markets that Carol Parry is withdrawing her nomination from the Fed, is there any substance to that, or do you know her intentions?

    MR. SPERLING: Not to my knowledge.

    Q Gene, White House officials have indicated many times that they would not accept a tax cut until you understood the whole budget picture. It's been a rationale for sort of shooting down Republican proposals immediately. Is that still operative, and how is that consistent with what you're doing today?

    MR. SPERLING: I think that because -- this was a special bipartisan commitment that the Speaker and the President made really before the State of the Union, and there was an understanding that we would keep this at a reasonable cost, that this would be a stand-alone provision.

    And while we still share the basic concern that one should not have large tax cuts without having an overall framework for debt reduction, Social Security, and Medicare, we felt that the importance of ensuring that we used this time when the economy is strong to ensure we're doing more for low-income communities was a reason enough to allow for a $10 billion to $20 billion program over 10 years that has bipartisan agreement and is designed to help people living in the most distressed areas in our country.

    Q If I could just follow up, basically, you're saying that it's small enough, the tax cut, and if everybody likes it, then you don't have to worry about the larger budget picture -- is that correct?

    MR. SPERLING: No, I said that we had a special agreement on this in light of the relative size, the relative importance, and unlike so many tax cuts that pass in this place where they're motivated by special interests and for special reasons, this is the United States Congress, the Speaker of the House and the President of the United States deciding to put together a package not for the powerful, but for those who lack economic power and seek economic opportunity.

    Q Gene, is there any significance to the timing of this, the day before the scheduled China vote -- some members who might stand to benefit as far as getting a new empowerment zone or other incentive package in their districts?

    MR. SPERLING: No. We've been close for quite a while. I would say the following -- I think that over the last few weeks the Speaker and the President have had more reason to talk to each other, and I think that as they have talked, that has helped to kind of clear the path for some of the final issues that were being negotiated.

    We've exchanged drafts with the Speaker -- offers and counteroffers -- with the Speaker's office probably 10, 12 times over the last few months. The interesting thing was the last -- on Thursday, we had been waiting for a reply to one of our offers for over a week. Normally, Ralph Hellman, their policy director, would send them to me directly.

    On this occasion, the Speaker actually brought the offer with him and handed it to the President directly, in the East Room right before they went out for the Africa-CBI trade bill. And they spoke for probably the third or fourth time in 10 days. And I think that those of us who were negotiating felt we had a clear instruction to get to work and close the deal.

    So this was a long time coming, and I think trying to get it done before Memorial Day and not letting it drag out into the summer was well in our interests because we still need to actually go through the mechanics of passing it in the House, and then we still have to go to the Senate where we're very hopeful that Senator Daschle and Majority Leader Lott will want to work on this. Clearly, many people in the Senate care about it; clearly, both of their states would benefit significantly from it.

    Q But even coincidentally, do you think there's any effect on the China vote, or not?

    MR. SPERLING: I don't know. There wasn't anything put in it regarding that. But I can't predict what effect it would have. I would say that people that we've invited down today for the signing who have been instrumental in this include both supporters and opponents of China PNTR.

    Q The Secretary of Commerce just said there was a relationship between the timing of this getting resolved and the China vote. Is he wrong on that? About a half hour ago he said very specifically that it is one of the things that moved it along and got it done today.

    MR. SPERLING: Well, he may have an opinion on whether it's helpful or harmful, but as the person who's been negotiating this, this has been a long time coming, for over three months, and we would have announced this any day that we could have closed on this agreement.

    Q Gene, how do you choose the cities that get the money?

    MR. SPERLING: There will be a competition, as done now, in which HUD basically chooses the urban and the Department of Agriculture has chosen the rural ones -- a competition. On the renewal communities, I believe they would take the same structure. I'm not entirely sure how they're going to choose the rural. Clearly, they would also have HUD choose the urban renewal community zones.

    But it's been a competition, and in the first round, some of the cities people expected to win didn't, which drew some heat, but I think also showed that it really was a fair competition.

    Q Gene, on the zero capital gains rate, you mentioned the District of Columbia is the only place where that exists now. Has the administration gathered any particular information, or has it reflected upon what that has meant for the District of Columbia as far as attracting investment? And on a technical question, I understand that rate applies if you hold the asset for five years.

    MR. SPERLING: That's right, and let me make that clear. The D.C. does -- it is designed to not only bring in capital, but to bring in patient capital into lower-income areas. I think that it's hard to tell at this point what the exact impact of the D.C. initiative has been. It only passed a couple of years ago. But it is designed to bring in capital. You do have to hold it for five years, so it's not designed to encourage people to come in, make a quick buck and take their money out. It's encouraged to make people part of the community, investors and participants in the community. And in an empowerment zone, with the zero capital gains rollover, it will hopefully encourage them to reinvest their money.

    But I think the fact that we did not know as much about it was one of the reasons that we had not supported this in the past. But again, the Speaker and Watts and Talent made a very strong case for this. And I think part of what we're trying to do is be respectful of different visions of how to bring incentives. They thought this was critical. And again, I should say that there are several Democrats, from Senator Lieberman to Congressman Jefferson, Congressman Clyburn, to some degree, Congressman Rangel, who also support having significant capital gain reductions in low-income areas.

    Q Gene, what do you think will work better -- the renewal zones or the empowerment zones?

    MR. SPERLING: For me, what I'm excited about was that 1993, there were no zones at all. And then we had nine. So for me to sit here now and announce that we have an agreement, a bipartisan agreement to have 80 of these type of zones with special incentives for investment, I think is just terrific. I hope it works.

    I think that it would be -- I think one possibility is that as the years go by, perhaps people will get a sense of what they think works best in each and perhaps there will be legislation to harmonize them in the future, or maybe people will find that it's best to have two different competing models out.

    But I think if you believe in this model of giving incentives for private capital, you have to be happy when there is this type of dramatic increase, even with slightly different forums.

    Q Gene, you mentioned that there would be regulatory relief in the renewal communities. What is the nature of that relief?

    MR. SPERLING: The nature of it is simply that -- the nature of it's simply is that in the empowerment zones, our philosophy on the applications has a lot been to make the community work together, come up with a strategic plan, and present that plan for how they're going to bring their community back.

    One of the great things in the empowerment zones were some of the stories that came out of Detroit, for example, where people left meetings where they were working on their applications, saying this was the first time the civil rights groups and the auto companies and the unions had ever been in a room together, strategizing about what was best for Detroit. We think that process is very important for coming up with a strategy.

    I think that in the renewal community, I think that their vision of it is that when they're looking for who to award that they would place a slightly higher emphasis on the degree that the community was providing regulatory relief, streamlining. So I don't think that they're inconsistent, but I think that it does reflect slightly different philosophies, and I think theirs goes under the vision that there may be regulatory burdens and zoning burdens that are inhibiting growth in some of these areas, and so they want that to at least be a factor to consider in the criteria. So it's a little bit of a different emphasis on the criteria for selection.

    Q You're talking about local permitting and issues like that, not federal regulatory relief or OSHA exemptions or some other --

    MR. SPERLING: Right. I think what they're saying is that under their vision of renewal communities when they were looking at the applications, they would give extra points where they saw more of the type of concern, the taking away zoning and regulatory barriers that they thought were not related enough to health and safety, and were simply serving as unnecessary burdens to entrepreneurship in those areas.

    Q This isn't the first time someone has stood at that podium and told Americans living in depressed areas that help was on the way and that their lot in life would certainly improve, courtesy of the federal government. First of all, why should those folks believe it today, and at what rate should this help arrive, do you suspect?

    MR. SPERLING: I think that what citizens in low-income areas should feel today is that while there is no silver bullet or single instant solution, that at least the federal government, in an election year, has gotten together in a bipartisan way and designed to make a major commitment to bringing in the capital and bringing in the investment opportunities that at least gives those communities a chance to start creating jobs, to start investing, to start bringing economic prosperity there.

    I wouldn't -- I think it is a message of hope and opportunity to those areas. And I think that you will find significant excitement at a local level, among the community groups.

    If you are a community group that's been trying to get investment into your area and you are out there trying to convince investors, take a chance -- take a chance on this area in the middle of Appalachia, or this poor urban area -- take a chance; you face a stiff challenge. If now you're able to say, hey, if you do that you can get a 30 percent tax credit right off; if you have a fund that invests, for every dollar you raise, you can get $2 of preferred financing from the government.

    I think when you put all those things together, you really are empowering many of the local heroes in community groups across the country. You are giving them more tools, more empowerment to build jobs in their area. And I can tell you -- let me tell you, I would encourage you to talk to Ray Moncrief, the CEO of Kentucky Highlands, he was here talking to President Mbeki yesterday; talk to Bill Bynum from the Economic Committee for Corporation for Development in the Mississippi Delta; talk to Cathy Bassant who runs Community Development at Bank America; talk to Mark Willis, who runs community development at Chase Manhattan. I think this was not -- this was a plan that we designed by talking to the people who are on the front lines. And so, I think they've -- and what they told us was to be specific.

    They said that under CRA and community development banking, that there had been an improvement in lending and mortgage accessibility. They said the problem was equity capital; there's not enough capital going into low-income areas, and even when there is, there isn't enough of the managerial assistance for the person who has the great idea, but may not be able to build up that network of managerial talent to do it.

    And so when we designed the New Market Tax Credit, and when we designed APEC's and New Market capital firms, we were trying to address the need we heard from people on the front lines.

    Thank you.

    END 10:57 A.M. ED
    

    ---

    PRESIDENT CLINTON ON RENEWAL COMMUNITIES   Posted: April 13, 2002
    THE WHITE HOUSE
    
    Office of the Press Secretary
    ________________________________________________________________________
    For Immediate Release May 25, 2000
    
    
    REMARKS BY THE PRESIDENT
    
    ...
    
    Q Mr. President, since you mentioned the New Markets Initiative, some Republicans say that that was the product of intense private negotiations between your staff and Hill Republicans. And there were substantial differences when those debates began. There were no public podium events dealing with New Markets, and yet they say there have been numerous public podium events on these issues -- prescription drugs and HMO -- but no intense private negotiations. Can you tell us why, sir, you and your staff have tried to use the podium more than intense negotiations?

    THE PRESIDENT: No, I'm more than willing to engage in private negotiations, but I don't think that's a fair representation of exactly how these issues developed. We did have some interest on the part of some Republicans with New Markets -- I know some of you have to go vote, so as long as you don't say they're abandoning me on the -- (laughter) -- on the patients' bill of rights, I'm going to give the senators who have to leave a pass.

    We did have a lot of interest on the front end in that -- and I made some calls around myself. But I have actually tried -- I have actually had several private conversations on these issues, and I will continue to do it. I think -- I believe we could pass the patients' bill of rights. We already passed a strong bill through the House with virtually 100 percent of our caucus, and a pretty good group of Republican votes with us. We're having trouble in the Senate, manifest in the conference committee, because some of the interest groups are still fighting what I think everybody who's looked at this believes is necessary to make a good bill.

    But I'm trying to negotiate on that. I had a private meeting on the gun safety legislation. I've had several conversations about that. I will -- I'm willing to do anything to resolve these things. But what we can't do here is to -- let me just say what the difference is in blunt terms.

    There is no great powerful special interest out there trying to beat the New Markets legislation. And therefore, what we had was people -- Washington was able to work the way it ought to work, because all we had were our philosophical differences. But we had a common goal. So we agreed in the best tradition of the founding fathers to let the Republicans try their ideas in 40 of their enterprise areas -- whatever the proper name is -- renewal community areas, and 40 for our empowerment zones. We agreed to provide for poor areas all over the country -- including those that aren't here, in either one of those two groups -- these special incentives of the New Markets.

    It was a wonderful example. And if all we ever had to do was reconcile our philosophical differences, we could pass all kinds of bills up here. But when you have an independent, powerful interest group that won't let them go, then we can have all the private talks that we want, until we're blue in the face, it's still hard to work it through. I haven't given up. But if you want to know the difference in New Markets and those things, it's not that we haven't had private talks; it's that there's no overwhelming interest group trying to beat this thing.
    

    ---

    1998CRH8806D TAXPAYER RELIEF ACT OF 1998, wrt RC's   Posted: April 13, 2002
    Archive-Name: gov/us/fed/congress/record/1998/sep/25/1998CRH8806D/part6

    ``(a) General Rule.--In the case of a renewal community business (as defined in section 1400G), for purposes of section 179-- ``(1) the limitation under section 179(b)(1) shall be increased by the lesser of-- ``(A) $35,000, or ``(B) the cost of section 179 property which is qualified renewal property placed in service during the taxable year, and ``(2) the amount taken into account under section 179(b)(2) with respect to any section 179 property which is qualified renewal property shall be 50 percent of the cost thereof. ``(b) Recapture.--Rules similar to the rules under section 179(d)(10) shall apply with respect to any qualified renewal property which ceases to be used in a renewal community by a renewal community business. ``(c) Qualified Renewal Property.--For purposes of this section-- ``(1) In general.--The term `qualified renewal property' means any property to which section 168 applies (or would apply but for section 179) if-- ``(A) such property was acquired by the taxpayer by purchase (as defined in section 179(d)(2)) after December 31, 1999, and before January 1, 2007, and ``(B) such property would be qualified zone property (as defined in section 1397C) if references to renewal communities were substituted for references to empowerment zones in section 1397C. ``(2) Certain rules to apply.--The rules of subsections (a)(2) and (b) of section 1397C shall apply for purposes of this section.''

    SEC. 603. EXTENSION OF EXPENSING OF ENVIRONMENTAL REMEDIATION COSTS TO RENEWAL COMMUNITIES.

    (a) Extension.--Paragraph (2) of section 198(c) (defining targeted area) is amended by redesignating subparagraph (C) as subparagraph (D) and by inserting after subparagraph (B) the following new subparagraph: ``(C) Renewal communities included.--Except as provided in subparagraph (B), such term shall include a renewal community (as defined in section 1400E).''

    [[Page H8834]]

    (b) Extension of Termination Date for Renewal Communities.--Subsection (h) of section 198 is amended by inserting before the period ``(December 31, 2006, in the case of a renewal community, as defined in section 1400E).''

    SEC. 604. EXTENSION OF WORK OPPORTUNITY TAX CREDIT FOR RENEWAL COMMUNITIES

    (a) Extension.--Subsection (c) of section 51 (relating to termination) is amended by adding at the end the following new paragraph: ``(5) Extension of credit for renewal communities.-- ``(A) In general.--In the case of an individual who begins work for the employer after the date contained in paragraph (4)(B), for purposes of section 38-- ``(i) in lieu of applying subsection (a), the amount of the work opportunity credit determined under this section for the taxable year shall be equal to--

    ``(I) 15 percent of the qualified first-year wages for such year, and ``(II) 30 percent of the qualified second-year wages for such year,

    ``(ii) subsection (b)(3) shall be applied by substituting `$10,000' for `$6,000', ``(iii) paragraph (4)(B) shall be applied by substituting for the date contained therein the last day for which the designation under section 1400E of the renewal community referred to in subparagraph (B)(i) is in effect, and ``(iv) rules similar to the rules of section 51A(b)(5)(C) shall apply. ``(B) Qualified first- and second-year wages.--For purposes of subparagraph (A)-- ``(i) In general.--The term `qualified wages' means, with respect to each 1-year period referred to in clause (ii) or (iii), as the case may be, the wages paid or incurred by the employer during the taxable year to any individual but only if--

    ``(I) the employer is engaged in a trade or business in a renewal community throughout such 1-year period, ``(II) the principal place of abode of such individual is in such renewal community throughout such 1-year period, and ``(III) substantially all of the services which such individual performs for the employer during such 1-year period are performed in such renewal community.

    ``(ii) Qualified first-year wages.--The term `qualified first-year wages' means, with respect to any individual, qualified wages attributable to service rendered during the 1-year period beginning with the day the individual begins work for the employer. ``(iii) Qualified second-year wages.--The term `qualified second-year wages' means, with respect to any individual, qualified wages attributable to service rendered during the 1-year period beginning on the day after the last day of the 1-year period with respect to such individual determined under clause (ii).'' (b) Congruent Treatment of Renewal Communities and Enterprise Zones for Purposes of Youth Residence Requirements.-- (1) High-risk youth.--Subparagraphs (A)(ii) and (B) of section 51(d)(5) are each amended by striking ``empowerment zone or enterprise community'' and inserting ``empowerment zone, enterprise community, or renewal community''. (2) Qualified summer youth employee.--Clause (iv) of section 51(d)(7)(A) is amended by striking ``empowerment zone or enterprise community'' and inserting ``empowerment zone, enterprise community, or renewal community''. (3) Headings.--Paragraphs (5)(B) and (7)(C) of section 51(d) are each amended by inserting ``or community'' in the heading after ``zone''.

    ``Subchapter X. Renewal Communities.''

    SEC. 606. EVALUATION AND REPORTING REQUIREMENTS.

    Not later than the close of the fourth calendar year after the year in which the Secretary of

    [[Page H8835]]

    Housing and Urban Development first designates an area as a renewal community under section 1400E of the Internal Revenue Code of 1986, and at the close of each fourth calendar year thereafter, such Secretary shall prepare and submit to the Congress a report on the effects of such designations in stimulating the creation of new jobs, particularly for disadvantaged workers and long-term unemployed individuals, and promoting the revitalization of economically distressed areas.
    

    ---

    CRS1463 AMENDMENTS SUBMITTED-HUD to transfer ownership of any qualified HUD property to the unit of general local government having jurisdiction for the area   Posted: April 13, 2002
    1998 CRS1463 AMENDMENTS SUBMITTED, Part 3/3
    Archive-Name: gov/us/fed/congress/record/1998/mar/05/1998CRS1463/part3

    (a) Transfer Requirement.--Pursuant to the authority under section 204 of the Departments of Veterans Affairs and Housing and Urban Development, and Independent Agencies Appropriations Act, 1997, the Secretary shall transfer ownership of any qualified HUD property to the unit of general local government having jurisdiction for the area in which the property is located in accordance with this section, but only if the unit of general local government enters into an agreement with the Secretary meeting the requirements of subsection (d). (b) Qualified HUD Properties.--For purposes of this section, the term ``qualified HUD property'' means any unoccupied multifamily housing, project, substandard multifamily housing project, or unoccupied single family property, that is-- (1) owned by the Secretary; and (2) located within a renewal community. (c) Timing of Transfer.--Any transfer of ownership required under subsection (a) shall be completed-- (1) with respect to any multifamily housing project or single family property that is acquired by the Secretary before the date on which the area in which property is located is designated as a renewal community and that is substandard or unoccupied (as applicable) upon such date, not later than 1 year after such date; and (2) with respect to any multifamily housing project or single family property that is acquired by the Secretary on or after the date on which the area in which the property is located is designated as a renewal community, not later than 1 year after--

    [[Page S1475]]

    (A) the date on which the project is determined to be substandard or unoccupied (as applicable), in the case of a property that is not unoccupied or substandard upon acquisition by the Secretary; or (B) the date on which the project is acquired by the Secretary, in the case of a property that is substandard or unoccupied (as applicable) upon such acquisition. (d) Agreements To Sell Property to Community Development Corporations.--An agreement described in this subsection is an agreement that requires a unit of general local government to dispose of the qualified HUD property acquired by the unit of general local government in accordance with the following requirements: (1) Notification to community development corporations.-- Not later than 30 days after the date on which the unit of general local government acquires title to the property under subsection (a), the unit of general local government shall notify each community development corporation located in the State in which the property is located-- (A) of such acquisition of title; and (B) that, during the 6-month period beginning on the date on which such notification is made, such community development corporations shall have the exclusive right under this subsection to make bona fide offers to purchase the property on a cost recovery basis. (2) Right of first refusal.--During the 6-month period described in paragraph (1)(B)-- (A) the unit of general local government may not sell or offer to sell the qualified HUD property other than to a party notified under paragraph (1), unless each community development corporation required to be so notified has notified the unit of general local government that the corporation will not make an offer to purchase the property; and (B) the unit of general local government shall accept a bona fide offer to purchase the property made during such period if the offer is acceptable to the unit of general local government, except that a unit of general local government may not sell a property to a community development corporation during that 6-month period other than on a cost recovery basis. (3) Other disposition.--During the 6-month period beginning on the expiration of the 6-month period described in paragraph (1)(B), the unit of general local government shall dispose of the property on a negotiated, competitive bid, or other basis, on such terms as the unit of general local government deems appropriate. (e) Satisfaction of Indebtedness.--Before transferring ownership of any qualified HUD property pursuant to subsection (a), the Secretary shall satisfy any indebtedness incurred in connection with the property to be transferred, by-- (1) canceling the indebtedness; or (2) reimbursing the unit of general local government to which the property is transferred for the amount of the indebtedness. (f) Determination of Status of Properties.--To ensure compliance with the requirements of subsection (c), the Secretary shall take the following actions: (1) Upon designation of renewal communities.--Upon the designation of any renewal community, the Secretary shall promptly assess each residential property owned by the Secretary that is located within such renewal community to determine whether such property is a qualified HUD property. (2) Upon acquisition.--Upon acquiring any residential property that is located with a renewal community, the Secretary shall promptly determine whether the property is a qualified HUD property. (3) Updates.--The Secretary shall periodically reassess the residential properties owned by the Secretary to determine whether any such properties have become qualified HUD properties. (g) Tenant Leases.--This section shall not affect the terms or the enforceability of any contract or lease entered into with respect to any residential property before the date that such property becomes a qualified HUD property. (h) Procedures.--Not later than the expiration of the 6- month period beginning on the date of the enactment of this Act, the Secretary shall establish, by rule, regulation, or order, such procedures as may be necessary to carry out this section. (i) Definitions.--For purposes of this section, the following definitions shall apply: (1) Community development corporation.--The term ``community development corporation'' means a nonprofit organization whose primary purpose is to promote community development by providing housing opportunities for low-income families. (2) Cost recovery basis.--The term ``cost recovery basis'' means, with respect to any sale of a residential property by a unit of general local government to a community development corporation under subsection (d)(2), that the purchase price paid by the community development corporation is less than or equal to the costs incurred by the unit of general local government in connection with such property during the period beginning on the date on which the unit of general local government acquires title to the property under subsection (a) and ending on the date on which the sale is consummated. (3) Low-income families.--The term ``low-income families'' has the meaning given the term in section 3(b) of the United States Housing Act of 1937. (4) Multifamily housing project.--The term ``multifamily housing project'' has the meaning given the term in section 203 of the Housing and Community Development Amendments of 1978. (5) Renewal community.--The term ``renewal community'' means an area designated (under subchapter X of chapter 1 of the Internal Revenue Code of 1986) as a renewal community. (6) Residential property.--The term ``residential property'' means a property that is a multifamily housing project or a single family property. (7) Secretary.--The term ``Secretary'' means the Secretary of Housing and Urban Development. (8) Severe physical problems.--The term ``severe physical problems'' means, with respect to a dwelling unit, that the unit-- (A) lacks hot or cold piped water, a flush toilet, or both a bathtub and a shower in the unit, for the exclusive use of that unit; (B) on not less than 3 separate occasions during the preceding winter months, was uncomfortably cold for a period of more than 6 consecutive hours due to a malfunction of the heating system for the unit; (C) has no functioning electrical service, exposed wiring, any room in which there is not a functioning electrical outlet, or has experienced 3 or more blown fuses or tripped circuit breakers during the preceding 90-day period; (D) is accessible through a public hallway in which there are no working light fixtures, loose or missing steps or railings, and no elevator; or (E) has severe maintenance problems, including water leaks involving the roof, windows, doors, basement, or pipes or plumbing fixtures, holes or open cracks in walls or ceilings, severe paint peeling or broken plaster, and signs of rodent infestation. (9) Single family property.--The term ``single family property'' means a 1- to 4-family residence. (10) Substandard.--The term ``substandard'' means, with respect to a multifamily housing project, that 25 percent or more of the dwelling units in the project have severe physical problems. (11) Unit of general local government.--The term ``unit of general local government'' has the meaning given the term in section 102(a) of the Housing and Community Development Act of 1974. (12) Unoccupied.--The term ``unoccupied'' means, with respect to a residential property, that the unit of general local government having jurisdiction over the area in which the project is located has certified in writing that the property is not inhabited.

    SEC. ____22. CRA CREDIT FOR INVESTMENTS IN COMMUNITY DEVELOPMENT ORGANIZATIONS LOCATED IN RENEWAL COMMUNITIES.

    Section 804 of the Community Reinvestment Act of 1977 (12 U.S.C. 2903) is amended by adding at the end the following new subsection: ``(c) Investments in Certain Community Development Organizations.--In assessing and taking into account, under subsection (a), the record of a regulated financial institution, the appropriate Federal financial supervisory agency may consider, as a factor, investments of the institution in, and capital investment, loan participation, and other ventures undertaken by the institution in cooperation with, any community development organization (as defined in section 234 of the Bank Enterprise Act of 1991) which is located in a renewal community (as designated under section 1400D of the Internal Revenue Code of 1986).''.

    
    

    ---

    Index of Topics in the Free Management Library   Posted: April 11, 2002
    Index of Topics in the Free Management Library

    Complete, highly integrated library of resources for nonprofit AND for-profit businesses

    Starting Nonprofit Business - what mean by "Starting a Nonprofit"? - feasibility study -- "really start nonprofit?" - consider fiscal sponsorship - need lawyer? - nonprofit incubators - free development program - checklists for starting new nonprofit - table of reminders - free on-line program to build nonprofit - also see: - - - e-commerce (start business on Internet?) - - - enterprise law - - - organizations (an introduction) - - - social entrepreneurship

    Taxation (Nonprofit) - getting tax-exempt status - importance of record keeping - federal, state, sales, payroll taxes, etc. - preparing and filing Form 990s (and disclosure) - donations and taxes - unrelated business income taxes (UBIT) - lobbying and taxes - topic -- independent contractor or employee? - also see: - - - finances and accounting (nonprofit) - - - fundraising & grantwriting (nonprofits) - - - Free Management Library, Micro-MBA and Nonprofit Micro-MBA are service marks of Authenticity Consulting, LLC (763-971-8890) Used by The Management Assistance Program for Nonprofits 2233 University Avenue West, Suite 360 St. Paul, Minnesota 55114 (651) 647-1216 With permission from Carter McNamara, MBA, PhD, Copyright 1999

    
    

    ---

    The Quality 990 (qual990.org) website   Posted: April 11, 2002
    The Quality 990 (qual990.org) website encompasses a number of projects and activities to improve the quality of IRS Form 990 reporting by nonprofit organizations.

    Why is Quality 990 Important?

    * Compliance?
    Filing an accurate and complete Form 990 with the IRS and state charity officials is the law.

    * Public Accountability?
    With the new IRS regulations, anyone can request a copy of any nonprofit organization's Form 990.

    * Public Relations?
    The Internet is making the Form 990 more widely available than ever before.
    * Primary Source of Data?

    Form 990 is the most commonly used data source about nonprofit organizations

    * Policy Making?Accurate Form 990 data will help policy makers develop the most effective ways of helping the sector, and allow nonprofits to better defend themselves against ill-advised legislative initiatives.
    
    
    
    Demonstration Electronic Form 990 Data Transfer
    

    ---

    Forming a Non-Profit Organization   Posted: April 11, 2002
    Questions About Forming a Non-Profit Organization:

    What is a nonprofit company?

    A nonprofit corporation is simply a corporation that is formed pursuant to a different state law than a standard for-profit corporation. The corporation must be formed for some religious, charitable, educational, literary or scientific purpose. While a standard business corporation is designed to benefit and generate a profit for its shareholders, nonprofit do not have the profit motive. Nonprofit corporations are allowed to apply for tax-exempt status at both the federal and state level.
    
    
    
    [Q & A - Non-Profit]
    
    Questions About Forming a Non-Profit Organization:
    
    
    What is a nonprofit company?
    
    A nonprofit corporation is simply a corporation that is formed pursuant to a different state law than a standard for-profit corporation. The corporation must be formed for some religious, charitable, educational, literary or scientific purpose. While a standard business corporation is designed to benefit and generate a profit for its shareholders, nonprofit do not have the profit motive. Nonprofit corporations are allowed to apply for tax-exempt status at both the federal and state level.
    
    
    
    What steps need to be taken to form a nonprofit corporation?
    
    The first step is to file nonprofit articles of incorporation with the proper state agency. It is important that the articles contain the required clauses to make sure your articles will qualify for tax-exempt status. Business Filings Incorporated prepares and files nonprofit articles of incorporation.
    
    After the nonprofit articles are filed, tax-exempt status must be applied for at both the federal and state levels. To apply at the federal level, a timely filing of form 1023 must be made. Business Filings does not prepare IRS form 1023. To determine what form needs to be filed at the state level, contact department that deals with taxation.
    
    The corporation must comply with corporate formalities and hold annual meetings of directors and members. Bylaws must be adopted for the corporation. Documents that help you comply with these corporate formalities are contained in our corporate kit.
    
    
    What purposes are valid for a nonprofit?
    
    To qualify for federal tax-exempt status, the nonprofit corporation must be organized and operate for some religious, charitable, educational, literary or scientific purpose permitted under 501(c)(3) of the tax code.
    
    The religious category refers to general types of religious organizations and more formal institutionalized churches.
    
    Charitable purpose is defined in section 501(c)(3) as providing services beneficial to the public interest.
    
    Scientific research that is carried on in the public interest qualifies for tax-exempt status; however, research incidental to commercial or industrial operations does not qualify.
    
    The literary purpose includes writing, publishing and distribution of books which are directed toward promoting the public interest rather than engaging in commercial book writing and selling.
    
    The educational purpose is a broad purpose that allows instruction for both self-development and the benefit of the community.
    
    The purpose must be listed in the articles of incorporation; therefore, it is very important the purpose of the corporation be well described on the articles of incorporation.
    
    For a specific answer to whether of not your company?s purposes is acceptable, contact an attorney or account.
    
    
    
    
    
    IRS classification of Nonprofit Corporations?
    
    Business Filings Incorporated prepares articles of incorporation for nonprofit corporations pursuant to section 501(c)(3) of the IRS code. Nonprofits formed under 501(c)(3) must be formed for some religious, charitable, educational, literary or scientific purpose.
    
    Nonprofit corporations may also be formed for other purposes pursuant to different sections of the IRS code. If you want Business Filings to form your nonprofit pursuant to a different provision of the IRS code, please let us know the code section in the purpose portion of the order form.
    
    To determine if your nonprofit needs to be formed pursuant to another provision of the IRS code, please consult the IRS organizational reference chart. (click here to view the IRS organizational chart).
    
    For specific advice, please consult an attorney or accountant.
    
    
    
    
    
    What form needs to be filed to apply for federal tax-exempt status?
    
    For a nonprofit company to qualify for 503(c)(3) federal tax-exempt status, a timely filing of IRS form 1023 must be made.
    
    A few groups are NOT technically required to file form 1023.
    
    1. A church, interchurch organization, convention of churches, or an integrated auxiliary of a church
    
    2. A subordinate organization covered by a group exemption letter (A parent tax- exempt company must submit a letter saying its subsidiary company will be tax- exempt).
    
    3. A group that qualifies for public charity status and which normally has gross receipts of LESS than $5,000 per year.
    
    However, it is recommended that these companies still file for tax-exempt status because this is the only way to be assured that the IRS views the corporation as a 501(c)(3) tax-exempt group. For example, it is possible that the IRS might later challenge your corporation?s tax-exempt status by arguing that your organization is not a church. If their argument is successful, your corporation would be subject to back tax and tax fines for the period it operated as a corporation.
    
    When the IRS approves the tax-exemption, then and ONLY then, can the nonprofit company be assured that contributions made to it are tax deductible, and that your corporation is a tax-exempt company.
    
    
    
    
    
    When must form 1023 be filed?
    
    The 1023 application is filed in a timely manner if it is postmarked within 15 months after the end of the month when your articles were filed.
    
    If you file on time, the tax-exemption is effective retroactively to the date on which your articles of incorporation were filed.
    
    
    
    
    
    How many directors are nonprofit corporations required to have?
    
    Most states require nonprofit corporation to have a minimum of three directors. The following states only require, at minimum, one director: CA, CO, DE, IA, KS, MI, MS, NH, OK, OR, PA, SC, VA, WA & WV.
    
    The following states allow less than three directors if there are less than three members: LA, MA, MN & VA.
    
    
    What are the advantages of filing a nonprofit corporation?
    
    If your nonprofit is granted tax-exempt status under 501(c)(3) of the Tax Code, your corporation will be exempt from payment of federal corporate income taxes. With federal income tax rates at between 15% to 34% this can amount to quite a tax savings.
    
    A 501(c)(3) nonprofit is eligible to receive both public and private grants. Individual donors can claim a federal income tax deduction of up to 50% of income for donations made to 501(c)(3) groups.
    
    Nonprofits also receive the same limited liability protection as for profit companies. This means that directors or trustees, officers and members are typically not personally responsible for the debts and liabilities of the corporation.
    
    Other benefits include:
    
    A corporation's life is not dependent upon its members. A corporation possesses the feature of unlimited life. If an owner dies or wishes to sell their interest the corporation will continue to exist and do business.
    
    Retirement funds, qualified retirement plans (like 401k) may be set up more easily with a corporation
    
    503(c)(3) corporations receive lower postal rates on some bulk mailings.
    
    Disadvantages of Forming a Nonprofit Corporation?
    
    The main disadvantage of forming a nonprofit company is the increased paperwork that is required. Articles of incorporation must be filed with the state, bylaws prepared and meeting minutes must be kept with your corporation&?s records. Business Filings Incorporated can help by preparing and filing your incorporation papers and our nonprofit kit does contain sample bylaws and meeting minutes. Also, applications for tax-exempt status must be filed at both the federal and state levels.
    
    It is important to remember that nonprofit can not be used to generate profits for the owners and the purpose must confirm to IRS regulations.
    

    ---

    SUMMARY OF PROVISIONS CONTAINED IN H.R. 5662, THE "COMMUNITY RENEWAL TAX RELIEF ACT OF 2000"   Posted: April 11, 2002
    

    SUMMARY OF PROVISIONS CONTAINED IN H.R. 5662, THE "COMMUNITY RENEWAL TAX RELIEF ACT OF 2000"

    Prepared by the Staff of the Joint Committee on Taxation

    December 15, 2000JCX-112-00

    (i)

    CONTENTS

    Page INTRODUCTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 TITLE I. COMMUNITY RENEWAL PROVISIONS . . . . . . . . . . . . . . . . . . . . . . . . 2

    A. Renewal Community Provisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2

    B. Empowerment Zone Tax Incentives . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2

    C. New Markets Tax Credit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3

    D. Increase the Low-Income Housing Tax Credit Cap and Make Other Modifications . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4

    E. Accelerate Scheduled Increase in State Volume Limits on Tax-Exempt Private Activity Bonds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4

    F. Extension and Modification to Expensing of Environmental Remediation Costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4

    G. Expansion of District of Columbia Homebuyer Tax Credit . . . . . . . . . . . . . . . . 4

    H. Extension of D.C. Enterprise Zone . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4

    I. Extension and Modification of Enhanced Deduction forCorporate Donations of Computer Technology . . . . . . . . . . . . . . . . . . . . . . . . . . 5

    J. Treatment of Indian Tribes as Non-Profit Organizations and State or LocalGovernments for Purposes of the Federal Unemployment Tax ("FUTA") . . . . . 5

    TITLE II. MEDICAL SAVINGS ACCOUNTS ("MSAs") . . . . . . . . . . . . . . . . . . . . 6

    TITLE III. ADMINISTRATIVE AND TECHNICAL CORRECTIONSPROVISIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7

    Subtitle A. Administrative Provisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7

    A. Exempt Certain Reports From Elimination Under the Federal ReportsElimination and Sunset Act of 1995 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7

    B. Extension of Deadlines for IRS Compliance with Certain NoticeRequirements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7

    C. Extension of Authority for Undercover Operations . . . . . . . . . . . . . . . . . . . . . . . 7

    D. Competent Authority and Pre-Filing Agreements . . . . . . . . . . . . . . . . . . . . . . . . 7

    E. Increase in Joint Committee on Taxation Refund Review Threshold . . . . . . . . . 7

    F. Clarify the Allowance of Certain Tax Benefits With Respect to KidnappedChildren . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8

    G. Conforming Changes to Accommodate Reduced Issuances of Certain TreasurySecurities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8

    H. Authorization of Agencies to Use Corrected Consumer Price Index . . . . . . . . . . 8

    I. Prevent Duplication or Acceleration of Loss Through Assumption of CertainLiabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8

    J. Disclosure of Return Information to the Congressional Budget Office . . . . . . . . 9

    Subtitle B. Tax Technical Corrections . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9

    TITLE IV. TAX TREATMENT OF SECURITIES FUTURES CONTRACTS . . . 10

    1 This document may be cited as follows: Joint Committee on Taxation, Summary of Provisions Contained in H.R. 5662, the "Community Renewal Tax Relief Act of 2000," (JCX-112-00), December 15, 2000.

    INTRODUCTION This document,1 prepared by the staff of the Joint Committee on Taxation, contains asummary of the provisions in H.R. 5662, the "Community Renewal Tax Relief Act of 2000". The provisions of H.R. 5662 are to be incorporated by reference in the conference agreement for H.R.4577, the Departments of Labor, Health and Human Services, and Education and Related Agencies Appropriations Act, 2001.

    -2-

    TITLE I. COMMUNITY RENEWAL PROVISIONS

    A. Renewal Communities Provisions The bill authorizes the Secretary of HUD to designate up to 40 "renewal communities"from areas nominated by States and local governments. At least 12 of the designated renewal communities must be in rural areas. In general, nominated areas are ranked based on a formulathat takes into account the area's poverty rate, median income, and unemployment rate.

    A nominated area that is designated as a renewal community is eligible for the followingtax incentives: (1) a zero-percent rate for capital gain from the sale of qualifying assets; (2) a 15- percent wage credit to employers for the first $10,000 of qualified wages; (3) a "commercialrevitalization deduction" that allows taxpayers (to the extent allocated by the appropriate State agency for the period after December 31, 2001) to deduct either (a) 50 percent of qualifyingexpenditures for the taxable year in which a qualified building is placed in service, or (b) all of the qualifying expenditures ratably over a 10-year period beginning with the month in which suchbuilding is placed in service; (4) an additional $35,000 of section 179 expensing for qualified property; and (5) an expansion of the WOTC with respect to individuals who live in a renewalcommunity.

    The 40 renewal communities must be designated by January 1, 2002, and the resulting taxbenefits will be available for the period beginning on January 1, 2002, and ending December 31, 2009.

    B. Empowerment Zone Provisions The bill extends the designation of empowerment zone status for existing empowermentzones (other than the D.C. Enterprise Zone) through December 31, 2009. The 20-percent wage credit is made available to all existing empowerment zones beginning in 2002 (and remains at the20-percent rate). Under the bill, $35,000 (rather than $20,000) of additional section 179 expensing is available for qualified zone property placed in service in taxable years beginningafter December 31, 2001, by a qualified zone business. Also beginning in 2002, certain businesses in existing empowerment zones (other than the D.C. Enterprise Zone) become eligiblefor more generous tax-exempt bond rules.

    The bill authorizes the Secretaries of HUD and Agriculture to designate nine additionalempowerment zones (seven to be located in urban areas and two in rural areas) by January 1, 2002. Businesses in the new empowerment zones are eligible for the same tax incentives that,under the bill, are available to existing zones (i.e., a 20-percent wage credit, $35,000 of additional section 179 expensing, and the enhanced tax-exempt financing benefits). The new empowermentzones must be designated by January 1, 2002, and the tax incentives with respect to the new empowerment zones generally are available during the period beginning on January 1, 2002, andending on December 31, 2009.

    -3-

    The bill permits a taxpayer to roll over gain from the sale or exchange of any qualifiedempowerment zone asset held for more than one year if the taxpayer uses the proceeds to purchase other qualifying empowerment zone assets (in the same zone) within 60 days of the sale of theoriginal asset. In general, a qualifying empowerment zone asset refers to a stock or partnership investment in, or assets acquired by, a qualifying business within an empowerment zone that ispurchased by a taxpayer after the date of enactment of the bill.

    The bill increases to 60 percent (from 50 percent) the exclusion of gain from the sale ofqualifying small business stock held more than five years if such stock also satisfies the requirements of a qualifying business under the empowerment zone rules. The provision iseffective for qualifying stock that is purchased after the date of enactment of the bill.

    C. New Markets Tax Credit The bill creates a new tax credit for qualified equity investments made after December 31,2000, to acquire stock in a community development entity ("CDE"). The maximum annual amount of qualifying equity investments is capped as follows:

    Calendar Year Maximum Qualifying Equity Investment 2001 $1.0 billion2002-2003 $1.5 billion per year 2004-2005 $2.0 billion per year2006-2007 $3.5 billion per year

    The amount of the credit allowed to the investor is (1) a five-percent credit for the year inwhich the equity interest is purchased from the CDE and for the first two anniversary dates after the purchase from the CDE, and (2) a six-percent credit on each anniversary date thereafter for thefollowing four years. The credit is recaptured if the entity fails to continue to be a CDE or the interest is redeemed within seven years.

    A CDE is any domestic corporation or partnership (1) whose primary mission is serving orproviding investment capital for low-income communities or low-income persons, (2) that maintains accountability to residents of low-income communities through representation ongoverning or advisory boards of the CDE, and (3) is certified by the Treasury Department as an eligible CDE. A qualified equity investment means stock or a similar equity interest acquireddirectly from a CDE for cash. Substantially all of the cash must be used by the CDE to make investments in, or loans to, qualified active businesses located in low-income communities, orcertain financial services to businesses and residents in low-income communities. A "low-income community" generally is defined as census tracts with either (1) poverty rates of at least 20 percentor (2) median family income which does not exceed 80 percent of the greater of metropolitan area income or statewide median family income. The Secretary may designate any area within anycensus tract as a low-income community provided that (1) the boundary is continuous, (2) the area would otherwise satisfy the poverty rate and median income requirements, and (3) an inadequateaccess to capital exists in the area.

    -4-

    D. Increase the Low-Income Housing Tax Credit Cap and Make Other Modifications

    The bill increases the per-capita low-income housing credit cap from $1.25 per capita to$1.50 per capita in calendar year 2001 and to $1.75 per capita in calendar year 2002. Beginning in calendar year 2003, the per-capita portion of the credit cap will be adjusted annually forinflation. For small States, a minimum annual cap of $2 million is provided for calendar years 2001 and 2002. Beginning in calendar year 2003, the small State minimum is adjusted forinflation. The bill also makes programmatic changes to the credit. The provisions are generally effective for calendar years beginning after December 31, 2000, and buildings placed-in-serviceafter such date in the case of projects that also receive financing with proceeds of tax-exempt bonds subject to the private activity bond volume limit which are issued after such date.

    E. Accelerate Scheduled Increase in State Volume Limitson Tax-Exempt Private Activity Bonds

    The bill increases the State volume limits on tax-exempt private activity bonds from thegreater of $50 per resident or $150 million to the greater of $75 per resident or $225 million beginning in calendar year 2002. Under the bill, the volume limit is the greater of $62.50 perresident or $187.5 million in calendar year 2001. Beginning in calendar year 2003, the volume limit will be adjusted annually for inflation.

    F. Extension and Modification to Expensing of Environmental Remediation Costs

    The bill extends the expiration date for expenditures for environmental remediation to beeligible for a current deduction in lieu of capitalization to include those expenditures paid or incurred before January 1, 2004. The bill eliminates the targeted area requirement, therebyexpanding eligible sites to include any site, other than a site identified on the national priorities list, containing (or potentially containing) a hazardous substance that is certified by the appropriateState environmental agency. The provision to expand the class of eligible sites is effective for expenditures paid or incurred after the date of enactment.

    G. Extension of the District of Columbia Homebuyer Tax Credit The bill extends the $5,000 tax credit that is available to first-time homebuyers of aprincipal residence in the District of Columbia for two years (through December 31, 2003).

    H. Extension of the D.C. Enterprise Zone The bill extends the D.C. Enterprise Zone designation through December 31, 2003.

    -5-

    I. Extension and Modification of Enhanced Deduction forCorporate Donations of Computer Technology The bill extends the current enhanced deduction for donations of computer technology andequipment for two years (through December 31, 2003). In addition, the bill expands the enhanced deduction to include donations to public libraries, to apply to property donated no later than threeyears (instead of two years) after the date the taxpayer acquired or substantially completed the construction of the donated property, and to apply to property donated after reaquisition by acomputer manufacturer. The bill permits the Secretary to develop standards to assure that computer donations meet minimum standards for educational purposes. The provision is effectivefor contributions made after December 31, 2000.

    J. Treatment of Indian Tribes as Non-Profit Organizations and State orLocal Governments for Purposes of the Federal Unemployment Tax ("FUTA") The bill provides that an Indian tribe (including any subdivision, subsidiary, or businessenterprise chartered and wholly owned by an Indian tribe) is treated like a non-profit organization or State or local government for FUTA purposes (i.e., given an election to choose thereimbursement treatment).

    The provision generally is effective with respect to service performed beginning on orafter the date of enactment. Under a transition rule, service performed in the employ of an Indian tribe is not treated as employment for FUTA purposes if: (1) it is service which is performedbefore the date of enactment and with respect to which FUTA tax has not been paid; and (2) such Indian tribe reimburses a State unemployment fund for unemployment benefits paid for serviceattributable to such tribe for such period.

    -6-

    TITLE II. MEDICAL SAVINGS ACCOUNTS The bill extends the MSA program through 2002. It is clarified that, as under present law,the cap and reporting requirements do not apply for 2000.

    MSAs are renamed under the bill as Archer MSAs.

    -7-

    TITLE III. ADMINISTRATIVE AND TECHNICAL CORRECTIONS PROVISIONS

    Subtitle A. Administrative Provisions A. Exempt Certain Reports From Elimination Under the Federal ReportsElimination and Sunset Act of 1995

    The bill exempts certain reports from elimination and sunset pursuant to the FederalReports Elimination and Sunset Act of 1995, effective on the date of enactment. B. Extension of Deadlines for IRS Compliance with Certain Notice Requirements

    The Internal Revenue Service Restructuring and Reform Act of 1998 requires the IRS toinclude the following information in each notice imposing a penalty: (1) the name of the penalty; (2) the Code section under which the penalty is impose; and (3) a computation of the penalty. TheAct also requires the IRS to include in notices requiring an amount of interest to be paid by the taxpayer a detailed computation of the interest charged and a citation to the Code section underwhich such interest is imposed. The bill extends the deadlines for the IRS to comply with the penalty and interest notice requirements from December 31, 2000, to June 30, 2001. For everytaxpayer in an installment agreement, the IRS is required to send an annual statement of (1) the initial balance owed, (2) the payments made during the year, and (3) the remaining balance. Thebill extends the deadline for the IRS to comply with this requirement from July 1, 2001, to September 1, 2001.

    C. Extension of Authority for Undercover Operations The bill extends for five years (through December 31, 2005) the authority of the IRS to"churn" the income earned from undercover operations to pay additional expenses incurred in the undercover operation, effective on the date of enactment.

    D. Competent Authority and Pre-Filing Agreements The bill affirms that closing agreements, similar agreements, and related backgroundinformation, are confidential return information. Closing agreements and similar agreements includes pre-filing agreements. The bill also clarifies that information exchanged and agreementsreached pursuant to tax treaties are confidential. The provision is effective for documents in existence on or created after the date of enactment.

    E. Increase in Joint Committee on Taxation Refund Review Threshold The bill increases the threshold above which refunds must be submitted to the JointCommittee on Taxation for review from $1,000,000 to $2,000,000, effective on the date of enactment, except that the higher threshold does not apply to a refund or credit with respect towhich a report was made before the date of enactment.

    -8-

    F. Clarify the Allowance of Certain Tax Benefits with Respect to Kidnapped Children

    The bill clarifies that the dependency exemption, the child credit, the surviving spousefiling status, the head of household filing status, and the earned income credit are available to an otherwise qualifying taxpayer with respect to a child who is presumed by law enforcementauthorities to have been kidnapped by someone who is not a member of the family of such child or the taxpayer. Generally, this treatment continues for all taxable years ending during the period thatthe child is kidnapped. However, this treatment ends for the taxable year ending after the calender year in which it is determined that the child is dead (or, if earlier, the year in which the childwould have attained age 18). The provision is effective for taxable years ending after the date of enactment.

    G. Conforming Changes to Accommodate Reduced Issuances of 52-Week Treasury Bills

    The bill changes references to "52-week Treasury bills" in the Code and in certain otherprovisions of Federal law to refer instead to "the weekly average one-year constant maturity Treasury yield, as published by the Board of Governors of the Federal Reserve System." Theprovision is effective on the date of enactment.

    H. Authorization of Agencies to Use Corrected Consumer Price Index ("CPI")

    The bill authorizes the Secretary of the Treasury to use the corrected levels of the CPI forall purposes of the Code to which they might apply, for taxable years beginning after December 31, 2000. In addition, the bill provides that the Director of the Office of Management and Budget("OMB") is to assess Federal benefit programs to ascertain the extent to which the CPI error has or will result in a shortfall in program payments to individuals for 2000 and future years andinstruct the head of any Federal agency which administers an affected program to make a payment or payments to compensate for the shortfall and that such payments are targeted to the amount of theshortfall experienced by individual beneficiaries. The provision is effective on the date of enactment.

    I. Prevent Duplication or Acceleration of Loss Through Assumption of Certain Liabilities

    The bill requires that the basis of stock received in a tax-free incorporation be reduced(but not below the stock's fair market value) by the amount of any liability that (1) is assumed in the exchange for such stock and (2) did not otherwise reduce the transferor's basis of the stock byreason of the assumption. Except as provided by the Treasury Department, the provision does not apply if the trade or business with which the liability associated is transferred to the corporationas part of the exchange, or if substantially all of the assets with which the liability is associated are transferred to the corporation as part of the exchange. The Secretary is to prescribe similar rulesfor transactions involving partnerships. The provision is effective for assumptions of liabilities on or after October 19, 1999.

    J. Disclosure of Return Information to the Congressional Budget Office

    -9-

    The bill amends section 6103 to permit the Secretary to furnish to CBO return informationto the extent such information is necessary for purposes of CBO's long-term models of Social Security and Medicare.

    Subtitle B. Technical Corrections The bill contains technical corrections to recent tax legislation.

    -10-

    TITLE IV. TAX TREATMENT OF SECURITIES FUTURES CONTRACTS The bill provides rules regarding the tax treatment of securities futures contracts. Asecurities futures contract generally is a contract of sale for future delivery of a single security or a narrow-based security index.

    Under the bill, except in the case of a dealer securities futures contract, gain or loss from asecurities futures contract is generally treated in a manner similar to gain or loss from transactions in the underlying security. Gain or loss from the sale or exchange of a securities futures contractgenerally is considered gain or loss from the sale or exchange of property which has the same character as the property to which the contract relates has (or would have) in the hands of thetaxpayer. Any capital gain or loss from the sale or exchange of a securities futures contract to sell property (i.e., the short side of a securities futures contract) generally will be short-term capitalgain or loss. The bill also provides for the application of the wash sale rules, the short sale rules, and the straddle rules to securities futures contracts.

    A "dealer securities futures contract" is treated as a section 1256 contract, which ismarked to market and treated as 40 percent short-term capital gain or loss and 60 percent longterm capital gain or loss. The term "dealer securities futures contract" means a securities futurescontract which is entered into by a dealer in the normal course of his or her trade or business activity of dealing in such contracts, and is traded on a qualified board of trade or exchange. Theterm also includes any option to enter into securities futures contracts purchased or granted by a dealer in the normal course of his or her trade or business activity of dealing in such options. Thedetermination of who is to be treated as a dealer in securities is to be made by the Secretary of the Treasury or his delegate not later than July 1, 2001, in a manner to provide comparable taxtreatment to dealers in equity options.

    The bill modifies the definition of "equity option" for purposes of section 1256 to take intoaccount changes made by the non-tax provisions of the bill. These provisions are effective on the date of enactment of the bill.
    

    ---

    Questions and Answers for Renewal Communities Workshops (8/22/01 revision)   Posted: April 11, 2002
    

    Questions and Answers for Renewal Communities Workshops (8/22/01 revision)

    * APPLICANTS WHO ARE NOW ECs or EZs

    * ROLE OF THE STATE

    * HOW THE APPLICATION WILL BE EVALUATED

    * POST DESIGNATION

    * DESIGN OF THE CORA

    * ADDITIONAL QUESTIONS

    * APPLICATION PROCESS

    * ELIGIBILITY

    * POVERTY RATES

    * CENSUS TRACTS

    * POPULATION CRITERIA

    * LEVERAGING OF COMMITMENTS

    These Renewal Community Questions and Answers are merely a study guide and not intended to provide an authoritative interpretation of the legal and administrative requirements governing HUD's Renewal Community Initiative or any other federal requirements. For official guidance on the RC initiative, please refer to the Interim Rule (24 CFR part 599) published on pages 35849 to 35860 of the July 9, 2001 Federal Register and the Notice Inviting Applications. When the Interim Rule is cited in the Q&As, only the section number will be used, for example, "599.107(b)."

    APPLICATION PROCESS

    1. Does the course of action limit the types of actions to business activities only or can it include such actions as housing and recreational activities within the nominated area? The Course of Action should be limited to at least four of the six strategies listed in the Interim Rule 599.107.

    2. Why aren't public hearings and direct participation a requirement in the development of the course of action? Applicants are required to provide certification of public notice. HUD does not mandate a specific form of community participation or notice, but communities are encouraged to use a variety of ways of involving the public. See 599.203 (c).

    3. Does each nomination package need to show the boundaries of their nominated area on an original census bureau plot map using 1990 census geography? No, unlike the Round III EZ requirement that Applicants show the boundaries of their nominated area on a 1990 census tract outline map, Renewal Community applicants may submit a map of their choice so long as it shows each of the 1990 census tracts making up the nominated area and clearly delineates the boundaries of the proposed Renewal Community.

    4. To what extent may CDBG funds be used for developing a Tax Incentive Utilization Plan for a Renewal Community (RC) or Round III Urban Empowerment Zone (EZ), for developing an EZ Strategic Plan, or to cover the costs associated with the submission of an application for designation of an area as an EZ or RC? Please refer to the CDBG regulations, 24 CFR Part 570. As a general rule, use of CDBG funds is permissible when the proposed expenditure is for an eligible activity and meets a national objective. At least 70% of a community's CDBG expenditures must be for activities that meet the national objective of benefiting low- and moderate-income people. Planning also is a CDBG-eligible activity if it meets the criteria set forth in 24 CFR 570.205. However, the recipient's total expenditures for administrative and planning costs under section 206 may not exceed 20% of its total CDBG expenditures.

    5. If an entity wants to submit a Renewal Community application can that entity submit an application directly to HUD for CDBG funds to cover the costs associated with the submission of an RC application? No. It's up to the entitlement community or the state to decide whether they wish to use CDBG funds for these costs.

    6. Will the applicant's statistics and narrative information indicating poverty, unemployment and general distress be rated and ranked as part of the Renewal Community scoring? Scoring is based on specified statistics, not on narrative information. See 599.105 & 599.303.

    7. Is there any way that I can compare my renewal community nominated area with other urban and rural areas eligible to compete for a Renewal Community designation? Applicants are welcome to do the research they feel necessary to determine the merits of their application, but in the interests of fairness HUD cannot share information about the status of applications or notices of intent to apply.

    ELIGIBILITY

    8. Why do existing Empowerment Zones and Enterprise Communities receive preference for the first twenty RC designations? HUD is limited to the selection criteria as authorized in the statute enacted by Congress. Existing EZs or ECs receive preference provided at least one census tract of the designated area is included in RC nominated area.

    9. Q. If you are not selected for a Round III EZ designation, does the EZ applicant get preference for obtaining an RC designation? Only existing EZs or ECs get a preference. See 599.401 (b). INCOME 10. In the case of Renewal Community nominations, is HUD's definition of low income based solely on a percentage of median income, such as 80%, 50% or 30%? Yes. The data that HUD compiled for this competition lists the number of households in each census tract whose incomes are below 80% of the Household Adjusted Median Family Income. The HAMFI reflects a HUD adjustment, however, and the adjustment comes in several forms, such as a household size adjustment and also an area adjustment that replaces local MFI with US or state MFI, or with a high rent based number. See 599.105(d).

    11. Where exactly do people get the Household Adjusted Median Family Income (HAMFI)? HUD-adjusted area median family income (HAMFI) -- In 1974, Congress defined "low income" and "very low income" for HUD rental programs as incomes not exceeding 80 and 50 percent, respectively, of the area median family income, as adjusted by HUD. Statutory adjustments now include upper and lower caps for areas with low or high ratios of housing costs to income and, for each non-metropolitan county, a lower cap equal to its State's non-metropolitan average. Estimates of the median family income and the official income cutoffs for each metropolitan area and non-metropolitan county are based on the most recent Decennial Census results and then updated each year by HUD. Each base income cutoff is assumed to apply to a household of four, and official cutoffs are further adjusted by household size: one person, 70 percent of base; two persons, 80 percent; three persons, 90 percent; five persons, 108 percent; six persons, 116 percent; and so on.

    UNEMPLOYMENT

    12. Does the unemployment requirement apply to the nominated area as a whole and not to each individual tract? Yes. See 599.105(b).

    13. We have been calculating the unemployment rate by looking at the 1990 number of unemployed for the nominated area and then determining what percentage this represents of the total 1990 persons listed as employed or unemployed (the sum of the two). Which is correct? Our on-line application system does the calculations for you and the practice system allows you to do all planning necessary. The correct procedure is the number of unemployed persons divided by the sum of employed persons and unemployed persons.

    14. It was noted that a 9.4% unemployment rate was necessary to be eligible for an RC designation. This sounds higher than 1 1/2 (150%) of the national unemployment rate. Is the 9.4% figure correct? This would place the national rate at 6.3%? The nominated area must have unemployment greater than 9.4%, i.e. 9.401% or greater. This figure is based on 150% of the 1990 national unemployment figure.

    POVERTY RATES

    15. Does the EZ 20% and 25% poverty rate requirement regarding a census tract with a population less than 2,000 and where 75% of the tract is zoned for commercial or industrial apply to Renewal Communities? No. EACH census tract in the RC nominated area must have at least 20% poverty unless it is on an Indian Reservation in which case we take the nominated area as a whole. 16. Is it 20% of households or persons living in poverty in each tract? HUD is looking for 20% of persons living in poverty in each tract. 17. What does the 20% poverty rate mean and how is the poverty rate determined for a given census tract? Poverty rates are taken from the Decennial Census. Following the Office of Management and Budget's (OMB) Statistical Policy Directive 14, the U.S. Census Bureau uses a set of money income thresholds that vary by family size and composition to determine who is poor. If a family's total income is less than that family's threshold, then that family, and every individual in it, is considered poor. The poverty thresholds do not vary geographically, but they are updated annually for inflation using the Consumer Price Index (CPI-U). The official poverty definition counts money income before taxes and does not include capital gains and noncash benefits (such as public housing, Medicaid, and food stamps). Poverty is not defined for people in military barracks, institutional group quarters, or for unrelated individuals under age 15 (such as foster children). These categories are excluded from the poverty universe--that is, they are considered neither as "poor" nor as "nonpoor." 18. Will the documentation regarding pervasive poverty that is submitted with the Certification for Economic Condition Requirements be reviewed as part of the selection process and will it be rated? Providing satisfactory documentation of pervasive poverty is a requirement for an application to be rated and ranked. All applications must complete the same certifications to qualify. See 599.105(a)

    19. Is there a page limit on the Course of Action part for the RC application? If not, what is the recommended length? There is no page limit, but remember we do not score it. Be sure to include the required contents but there is no need to provide extraneous details or special formatting. We do not have a recommended length.

    CENSUS TRACTS

    20. Is the "raw" number of households below the 80%, median income available on HUD's site? How and where do you get the unemployment data at the census tract level? What is an economically distressed census tract and where can I find statistics or data on this? Unemployment, poverty and household income data at the census tract level is on our website at https://www.hud.gov/offices/cpd/ezec/index.cfm. Also on this page is the list of GAO distressed census tracts. POPULATION CRITERIA

    21. Will nominated areas having large populations (200,000) be rated with areas having smaller populations (2000 or 4000)? Urban and rural nominated areas that meet the eligibility requirements are ranked separately. Then, selections are made considering the required preferences for existing EZs or ECs and for rural area nominations. The remaining designations will be made from both rural and urban areas in rank order. See 599.401, 403 and 405.

    LEVERAGING OF COMMITMENTS

    22. Can the Renewal Community applicant get a blanket sign off from the State instead of having to get signatures for each of the certifications? No, each of the required Certifications and the Course of Action must have the original signature of the responsible official who is authorized to act on behalf of each nominating State or local government named in the application documents, including those documents that pertain to the certifications. See 599.101(c) and 599.107(a)(1).

    23. Would reducing utilities costs by a utility company defined as a municipal cooperative be considered as a local effort/action in meeting Course of Action requirements? A reduction in a municipal entity's fees or costs that otherwise would apply in the nominated area appear to meet the course of action requirements. See 599.107(a)(2)(v)(A) and (B). In addition, the reduction of fees or costs does not have to be limited to future actions but could be included in the course of action even if the reduction within the nominated area is either complete or ongoing. See 599.107(c).

    APPLICANTS WHO ARE NOW ECs or EZs

    24. If a portion of a Round I or II rural EC is included in the Renewal Community's nominated area will the entire Round I or II rural Enterprise Community designation cease to exist? Yes. However, the loss of designation may not result in the loss of grant funds previously awarded.

    25. If all of the first twenty Renewal Community slots in Category 1 that give preference to Empowerment Zones (EZs) and Enterprise Communities (ECs) go to EZs and ECs, what then becomes of the "freed-up" EZ and EC slots? The Community Renewal Tax Relief Act of 2000 (CRTR Act) provides that when a Round I and Round II Empowerment Zone is designated as a Renewal Community, it ceases to exists as an EZ, but its former EZ slot will be available to other applicants through a competitive process. This does not apply to ECs. If an ECs gets a designation as an RC its lost designation would not become available to other applicants.

    26. What would be the incentive for a current Empowerment Zone or Enterprise Community to be designated as a Renewal Community? Please see the Tax Incentive Guide for Businesses to compare the benefits of each. Also, ECs' benefits end on December 31, 2004 and RCs' benefits end on December 31, 2009. For example, Renewal Communities have a 0% Capital Gains Tax Incentive for businesses in the nominated area and a Commercial Revitalization tax credit that the EZ/ECs do not. Applicants need to determine the benefits for their community on a case-by-case basis by involving business partners in their Tax Incentive Utilization Plan.

    ROLE OF THE STATE

    27. Has HUD contacted the States to ask them to designate the Office and contact person who will certify the Renewal Community applications? HUD has not contacted States to specifically ask them to designate an office and contact person, but since a successful RC is based on partnerships and requires a nomination from the State, it would be helpful if States take that step. Also, for local governments who want to know the contact information for the current urban EZs and ECs, that list is available by calling 202-708-6339. In addition, questions about the situation in specific states may be submitted by email to john_haines@hud.gov, or by facsimile to 202-401-7615 or 202-708-3363.

    HOW THE APPLICATION WILL BE EVALUATED

    28. Why are areas of highest crime (Local Crime Index Rate) not given priority for Renewal Community nominated areas where economic development is needed the most instead of census tracts with lower crime rates? HUD is limited to the selection criteria in the authorizing statute enacted by Congress. The Renewal Community initiative takes an assets based approach to economic development. A low crime rate is one of the assets that a community can use to leverage resources for its course of action.

    29. How can a nominee calculate the Local Crime Index (LCI) for a nominated area if crime data is not available for individual census tracts? If it is impossible to determine the LCI for the nominated area because the boundaries of the crime reporting sectors do not correspond to the boundaries of the census-tract based nominated areas, then the nominating governments should use data from the smallest-sized sectors that most closely approximate and include the nominated area.

    POST DESIGNATION 30. Is there any intention of providing funding to Renewal Communities or Round III Empowerment Zones next year or later? Congress has not authorized such RC funding for this year or later at this time.

    ADDITIONAL QUESTIONS

    31. Are there HHS grants that non-profit agencies can apply directly for consideration? Please see www.dhhs.gov for more information about DHHS grants programs.

    32. What are the Champion Communities? Who made them that? Champion Communities are communities that applied for the Round I EZ/EC competition and for who did not win a designation, but were deemed by HUD to have significant merit in their applications. Some States supported Champion Communities with their own resources and incentives and some Federal competitions provided preference points.

    
    

    ---

    Starting a Nonprofit Organization: One-Stop Answer Page   Posted: April 10, 2002
    https://nonprofit.about.com/library/weekly/blonestart.htm

    Starting a Nonprofit Organization: One-Stop Answer Page

    First Steps Answer These Questions Read this first. You should be able to answer the five questions listed here before you begin.

    Overview A summary of what you should know before you begin. Do I Need to Incorporate? Anthony Mancuso has put together helpful FAQs.

    FAQs Putnam Barber and associates answer some important questions.

    Getting Started Start-up Resources Links to help you get started. Find sample bylaws and how to write a mission statement here.

    Forms, Samples and Legal Matters Links to IRS forms and instructions and sample articles of incorporation.

    Fiscal Sponsorship Maybe there's an alternative to starting a new nonprofit.

    Getting Your Tax Exemption FAQs about the tax-exemption process.

    Planning Nonprofit Budgeting You'll need a budget before you do just about anything.

    Business Plans Nonprofit organizations are a business. You need a plan.

    Management Resources Links to Internet nonprofit management resources.

    Strategic Planning Think about the long-term issues when you do strategic planning.

    Boards of Directors Board Governance for Small Nonprofits Don't try to do too much too fast.

    Practical Hints for Building Your Board Some tips on recruiting and keeping board members.

    Board Resources Links to Internet resources for nonprofit boards.

    Board Orientation Materials Here are the materials you should give new board members. Raising Money for Your Organization First Rule of Fundraising A basic introduction to the art and science of fundraising.

    Articles About Fundraising A collection of articles about fundraising from your About.com guide.

    Fundraising Resources Internet resources for fundraisers.

    Online Fundraising What is online fundraising? Find some answers here.
    

    ---

    House Debate on RC's   Posted: April 10, 2002
    gov/us/fed/congress/record/2000/jul/25/2000CRH6797A/part4 (Mr. English). Mr. ENGLISH. Mr. Speaker, I yield myself 2 1/4 minutes. Today, Mr. Speaker, we will vote on landmark legislation that will provide our communities with the tools they need to revitalize our cities and many of our depressed rural areas. This is the day we will provide communities the tools they need to once again become self- reliant, and with that we give people more control over their own futures. The Community Renewal and New Markets Act breathes new life into areas that have become America's forgotten communities. With this legislation, we empower impoverished cities and towns to rise above the perils of poverty. We give them the mechanisms needed to mold faith, family, hard work, and cooperation into opportunity, while expanding the community leaders' ability to attract new investment and grow existing businesses. This bipartisan community renewal initiative will provide poor inner cities and rural areas with workable mechanisms that allow them to evaluate the needs in their communities and address them. This bill creates 40 renewal communities with targeted pro-growth tax benefits, homeownership opportunities, and other incentives that address the principal hurdles facing budding small businesses: raising capital and maintaining cash flow. In a renewal community, individuals would not pay capital gains taxes on the sale of renewal community businesses and business assets held for more than 5 years. Small businesses would also be able to expense up to $35,000 more in equipment than they are able to under current law. And those who revitalize buildings located in these renewal communities will receive a special deduction. Beyond that, this bill will stimulate State efforts to build the necessary infrastructure and rebuild economically depressed areas by accelerating the scheduled increase in the amount of tax exempt private bonds. Even more importantly, we will increase the amount of low-income tax credits a State can allocate. This translates into more and better housing opportunities for low-income families. Today, through a variety of incentives, we will create a fertile environment for growth, with targeted pro-growth tax benefits, regulatory relief, savings accounts, and homeownership opportunities, as well as provide for the inclusion of local faith-based organizations. This is an opportunity for Congress to aid in lifting up those who have already been left behind during a time when many are enjoying the benefits of a prospering economy. With this legislation, we will truly make a difference in people's lives and allow more people to participate in the American Dream. Mr. Speaker, I submit for the Record material from the Joint Committee on Taxation relevant to this bill.

    TECHNICAL EXPLANATION OF THE TAX PROVISIONS IN H.R. 4923 THE ``COMMUNITY RENEWAL AND NEW MARKETS ACT OF 2000''

    (Prepared by the Staff of the Joint Committee on Taxation)

    I. Introduction

    This document, prepared by the staff of the Joint Committee on Taxation, provides a technical explanation of the tax provisions contained in H.R. 4923, the ``Community Renewal and New Markets Act of 2000.''

    II. Summary

    H.R. 4923, the ``Community Renewal and New Markets Act of 2000,'' provides additional tax incentives for targeted areas that are identified as areas of pervasive poverty, high unemployment, and general economic distress. The bill also increases the limits with respect to the low-income housing tax credit and the private activity bond volume caps. Tax incentives for renewal communities The bill authorizes the Secretary of HUD to designate up to 40 ``renewal communities'' from areas nominated by States and local governments. At least eight of the designated renewal communities must be in rural areas. In general, nominated areas are ranked based on a formula that takes into account the area's poverty rate, median income, and unemployment rate. A nominated area within the District of Columbia will be designated as a renewal community (without regard to its ranking) beginning in 2003. A nominated area that is designated as a renewal community is eligible for the following tax incentives during the period beginning July 1, 2001, and ending December 31, 2009: (1) a 100-percent capital gains exclusion for capital gain from the sale of qualifying assets acquired after June 30, 2001, and before January 1, 2010, and held for more than five years; (2) a 15 percent wage credit to employers for the first $10,000 of qualified wages paid to each employee who (i) is a resident of the renewal community, and (ii) performs substantially all employment services within the renewal community in a trade or business of the employer; (3) a ``commercial revitalization expenditure'' that allows taxpayers (to the extent allocated by the appropriate State agency for the period after June 30, 2001) to deduct either (i) 50 percent of qualifying expenditures for the taxable year in which a qualified building is placed in service, or (ii) all of the qualifying expenditures ratably over a 10- year period beginning with the month in which such building is placed in service; (4) an additional $35,000 of section 179 expensing for qualified renewal property placed in service after June 30, 2001 and before January 1, 2010 by a renewal community business; (5) the expensing of certain environmental remediation expenditures incurred after June 30, 2001, and before January 1, 2010 within a renewal community; and (6) an expansion of the Work Opportunity Tax Credit with respect to qualified individuals who live in a renewal community. Extension and expansion of empowerment zone incentives The bill extends the designation of empowerment zone status for existing zones (other than the D.C. Enterprise Zone) through December 31, 2009. In addition, the 20-percent wage credit is made available to all existing empowerment zones beginning in 2002 (and remains at the 20-percent rate). Furthermore, $35,000 (rather than $20,000) of additional section 179 expensing is available for qualified zone property placed in service in taxable years beginning after December 31, 2001, by a qualified zone business. The bill also extends an empowerment zone's status

    [[Page H6817]]

    as a ``target area'' under section 198 (thus permitting expensing of certain environmental remediation costs) for costs incurred after December 31, 2001, and before January 1, 2010. Also beginning in 2002, certain businesses in existing empowerment zones (other than the D.C. Enterprise Zone) become eligible for more generous tax-exempt bond rules. The bill also authorizes Secretaries of HUD and Agriculture to designate nine additional empowerment zones (seven to be located in urban areas and two in rural areas). The new empowerment zones must be designated by January 1, 2002, and the tax incentives with respect to the new empowerment zones generally are available during the period beginning on January 1, 2002, and ending on December 31, 2009. Businesses in the new empowerment zones are eligible for the same tax incentives that, under this bill, are available to existing zones (i.e., a 20-percent wage credit, $35,000 of additional section 179 expensing, the enhanced tax-exempt financing benefits, and expensing of certain environmental remediation costs). The bill permits a taxpayer to roll over gain from the sale or exchange of any qualified empowerment zone asset held for more than 1 year where the taxpayer uses the proceeds to purchase other qualifying empowerment zone assets (in the same zone) within 60 days of the sale of the original asset. In general, a qualifying empowerment zone asset refers to a stock or partnership investment in, or assets acquired by, a qualifying business within an empowerment zone that is purchased by a taxpayer after the date of enactment of the bill. The bill increases to 60 percent (from 50 percent) the exclusion of gain from the sale of qualifying small business stock held more than five years where such stock also satisfies the requirements of a qualifying business under the empowerment zone rules. The provision applies to qualifying small business stock that is purchased after the date of enactment of the bill. Provide new markets tax credit The bill creates a new tax credit for qualified equity investments made after December 31, 2000, to acquire stock in a community development entity (``CDE''). The maximum annual amount of qualifying equity investments is capped as follows:

    ------------------------------------------------------------------------ Maximum qualifying equity Calendar year investment ------------------------------------------------------------------------ 2001............................... $1.0 billion 2002-2003.......................... $1.5 billion per year 2004-2005.......................... $2.0 billion per year 2006-2007.......................... $3.5 billion per year ------------------------------------------------------------------------

    The amount of the credit allowed to the investor is (1) a five-percent credit for the year in which the equity interest is purchased from the CDE and for the first two anniversary dates after the purchase from the CDE, and (2) a six percent on each anniversary date thereafter for the following four years. The credit is recaptured if the entity fails to continue to be a CDE or the interest is redeemed within seven years. A CDE is any domestic corporation or partnership (1) whose primary mission is serving or providing investment capital for low-income communities or low-income persons, (2) that maintains accountability to residents of low-income communities through representation on governing or advisory boards, and (3) is certified by the Treasury Department as an eligible CDE. A qualified equity investment means stock or a similar equity interest acquired directly from a CDE for cash. Substantially all of the cash must be used by the CDE to make investments in, or loans to, qualified active businesses located in low-income communities, or certain financial services to businesses and residents in low-income communities. A ``low-income community'' generally is defined as census tracts with either (1) poverty rates of at least 20 percent, or (2) median family income which does not exceed 80 percent of the greater of metropolitan area income or statewide median family income. Improvements in the low-income housing tax credit The bill increases the low-income housing credit cap to $1.75 per resident between 2001 and 2006 as follows:

    Applicable Calendar year credit amount 2001..............................................................$1.35 2002...............................................................1.45 2003...............................................................1.55 2004...............................................................1.65 2005...............................................................1.70 2006...............................................................1.75

    In addition, beginning in 2001, the per capita cap is modified so that less populous States are given a minimum of $2 million of annual credit cap. The $1.75 per capita credit cap and the $2 million amount is indexed for inflation beginning in 2007. The bill also makes several programmatic changes to the credit. Acceleration of phase-in of increase in private activity bond volume cap The bill accelerates the scheduled phased-in increases in the present-law annual State private activity bond volume limits to $75 per resident of each State or $225 million (if greater). The increase is phased in as follows, beginning in calendar year 2001:

    ------------------------------------------------------------------------ Calendar year Volume limit ------------------------------------------------------------------------ 2001........................... $55 per resident ($165 million if greater) 2002........................... $60 per resident ($180 million if greater) 2003........................... $65 per resident ($195 million if greater) 2004, 2005, 2006............... $70 per resident ($210 million if greater) 2007 and thereafter............ $75 per resident ($225 million if greater) ------------------------------------------------------------------------

    III. Explanation of the Tax Provisions in H.R. 4923

    A. Renewal Community Provisions (Secs. 101-103 of the Bill)

    Present Law

    In recent years, provisions have been added to the Internal Revenue Code that target specific geographic areas for special Federal income tax treatment. As described in greater detail below, empowerment zones and enterprise communities generally provide tax incentives for businesses that locate within certain geographic areas designated by the Secretaries of Housing and Urban Development (``HUD'') and Agriculture.

    Explanation of Provision

    The bill authorizes the designation of 40 ``renewal communities'' within which special tax incentives will be available. Designation process Designation of 40 renewal communities.--Secretary of HUD is authorized to designate up to 40 ``renewal communities'' from areas nominated by States and local governments. At least eight of the designated communities must be in rural areas. The Secretary of HUD is required to publish (within four months after enactment) regulations describing the nomination and selection process. Designations of renewal communities are to be made within 24 months after such regulations are published. The designation of an areas as a renewal community generally will be effective on July 1, 2001, and will terminate after December 31, 2009. Eligiblity criteria.--To be designated as a renewal community, a nominated areas must meet the following criteria: (1) each census tract must have a poverty rate of at least 20 percent; (2) in the case of urban area, at least 70 percent of the households have incomes below 80 percent of the median income of households within the local government jurisdiction; (3) the unemployment rate is at least 1.5 times the national unemployment rate; and (4) the area is one of pervasive poverty, unemployment, and general distress. Those areas with the highest average ranking of eligibility factors (1), (2), and (3) above would be designated as renewal communities. A nominated area within the District of Columbia becomes a renewal community (without regard to its ranking of eligibility factors) provided that it satisfies the area and eligibility requirements and the required State and local commitments described below. The Secretary of HUD shall take into account in selecting areas for designation the extent to which such areas have a high incidence of crime, as well as whether the area has census tracts identified in the May 12, 1998, report of the General Accounting Office regarding the identification of economically distressed areas. There are no geographic size limitations placed on renewal communities. Instead, the boundary of a renewal community must be continuous. In addition, the renewal community must have a minimum population of 4,000 if the community is located within a metropolitan statistical area (at least 1,000 in all other cases) and a maximum population of not more than 200,000. The population limitations do not apply to any renewal community that is entirely within an Indian reservation. Required State and local communities.--In order for an area to be designated as a renewal community, State and local governments are required to submit (1) a written course of action in which the State and local governments promise to take at least four governmental actions within the nominated area from a specified list of actions, and (2) a list of at least four economic measures the State and local governments promise to take (from a specified list of measures) if the area is designated as a renewal community. Empowerment zones and enterprise a communities seeking designation as renewal communities.--An empowerment zone or enterprise community can apply for designation as a renewal community. If a renewal community designation is granted, then an area's designation as an empowerment zone or enterprise community ceases as of the date the area's designation as a renewal community takes effect. Tax incentives for renewal communities The following tax incentives generally would be available during the period beginning July 1, 2001, and ending December 31, 2009. 100-percent capital gain exclusion.--The bill provides a 100-percent capital gains exclusion for gain from the sale of a qualified community asset acquired after June 30, 2001 and before January 1, 2010, and held for more than five years. A ``qualified community asset'' includes: (1) qualified community stock (meaning original-issue stock purchased for cash in a renewal community business); (2) a qualified community partnership interest (meaning a partnership interest acquired for cash in a renewal community business); and (3) qualified community business property (meaning tangible property originally used in a renewal community business by the taxpayer) that is purchased or substantially improved after June 30, 2001. A ``renewal community business'' is similar to the present- law definition of an enterprise zone business. Property will continue to be a qualified community asset if sold (or otherwise transferred) to a subsequent purchaser, provided that the property continues to represent an interest in (or tangible property used in) a renewal community business.

    [[Page H6818]]

    The termination of an area's status as a renewal community will not affect whether property is a qualified community asset, but any gain attributable to the period before July 1, 2001, or after December 31, 2014, will not be eligible for the exclusion. Renewal community employment credit.--A 15-percent wage credit is available to employers for the first $10,000 of qualified wages paid to each employee who (1) is a resident of the renewal community, and (2) performs substantially all employment services within the renewal community in a trade or business of the employer. The wage credit rate applies to qualifying wages paid after June 30, 2001, and before January 1, 2010. Wages that qualify for the credit are wages that are considered ``qualified zone wages'' for purposes of the empowerment zone wage credit (including coordination with the Work Opportunity Tax Credit). In general, any taxable business carrying out activities in the renewal community may claim the wage credit. Commercial revitalization deduction.--The bill allows each State to allocate up to $12 million of ``commercial revitalization expenditures'' to each renewal community located within the State for each calendar year after 2001 and before 2010 ($6 million for the period of July 1, 2001 through December 31, 2001). The appropriate State agency will make the allocations pursuant to a qualified allocation plan. A ``commercial revitalization expenditure'' means the cost of a new building or the cost of substantially rehabilitating an existing building. The building must be used for commercial purposes and be located in a renewal community. In the case of the rehabilitation of an existing building, the cost of acquiring the building will be treated as qualifying expenditures only to the extent that such costs do not exceed 30 percent of the other rehabilitation expenditures. The qualifying expenditures for any building cannot exceed $10 million. A taxpayer can elect either to (a) deduct one-half of the commercial revitalization expenditures for the taxable year the building is placed in service or (b) amortize all the expenditures ratably over the 120-month period beginning with the month the building is placed in service. No depreciation is allowed for amounts deducted under this provision. The adjusted basis is reduced by the amount of the commercial revitalization deduction, and the deduction is treated as a depreciation deduction in applying the depreciation recapture rules (e.g., sec. 1250). The commercial revitalization deduction is treated in the same manner as the low income housing credit in applying the passive loss rules (sec. 469). Thus, up to $25,000 of deductions (together with the other deductions and credits not subject to the passive loss limitation by reason of section 469(i)) are allowed to an individual taxpayer regardless of the taxpayer's adjusted gross income. The commercial revitalization deduction is allowed in computing a taxpayer's alternative minimum taxable income. Additional section 179 expensing.--A renewal community business is allowed an additional $35,000 of section 179 expensing for qualified renewal property placed in service after June 30, 2001, and before January 1, 2010. The section 179 expensing allowed to a taxpayer is phased out by the amount by which 50 percent of the cost of qualified renewal property placed in service during the year by the taxpayer exceeds $200,000. The term ``qualified renewal property'' is similar to the definition of ``qualified zone property'' under section 1397C. Expensing of environmental remediation costs (``brownfields'').--A renewal community is treated as a ``targeted area'' under section 198 (which permits the expensing of environmental remediation costs). Thus, taxpayers can elect to treat certain environmental remediation expenditures that otherwise would be capitalized as deductible in the year paid or incurred. This provision applies to expenditures incurred after June 30, 2001, and before January 1, 2010. Extension of work opportunity tax credit (``WOTC'').--The bill expands the high-risk youth and qualified summer youth categories in the WOTC to include qualified individuals who live in a renewal community.

    Effective Date

    Renewal communities must be designated within 24 months after publication of regulations by HUD. The tax benefits available in renewal communities are effective for the period beginning July 1, 2001, and ending December 31, 2009.
    

    ---

    PRESIDENT CLINTON'S NEW MARKETS INITIATIVE: REVITALIZING AMERICA'S UNDERSERVED COMMUNITIES   Posted: April 10, 2002
    
    
    REVITALIZING AMERICA'S UNDERSERVED COMMUNITIES
    
    December 14, 2000

    Today, President Clinton is pleased to announce the passage of the historic new bipartisan New Markets and Community Renewal initiative. This announcement is the outcome of the commitment President Clinton and Speaker Hastert made in Chicago last Nov. to develop a bipartisan legislative initiative on New Markets and revitalizing impoverished communities this year. This initiative will help encourage private sector equity investment in underserved communities throughout the country to ensure that all Americans share in our nation's economic prosperity. The President's New Markets Initiative was originally proposed in President Clinton and Vice-President Gore's FY 2000 budget. President Clinton has highlighted the potential of the nation's New Markets in three separate trips across America to underserved inner city and rural communities like Newark, NJ, Hartford, CT, the Mississippi Delta, Appalachia, and rural Arkansas, and the Pine Ridge Indian Reservation in S. Dakota.

    THE KEY ELEMENTS OF THE LEGISLATION ARE:

    NEW MARKETS INITIATIVES: -- The New Markets Tax Credit. The credit will spur $15 billion in equity investment for business growth in low- and moderate-income rural and urban communities throughout the United States and Puerto Rico. The credit, worth over 30 percent of the amount invested (in present value terms), will be available to taxpayers who invest in a wide range of privately managed community development investment funds, such as community development banks and other CDFIs, venture funds, and new investment companies, that finance businesses in low- and moderate-income communities.

    -- New Markets Venture Capital (NMVC) Firms. NMVC firms will provide incentives to increase the availability of venture capital in low and moderate-income communities for small businesses. Expert guidance will also be made available to small business entrepreneurs in inner city and rural areas. Ten to twenty NMVC firms are planned. The agreement authorizes the SBA to guarantee up to $150 million in loans that will match $100 million in private equity for a total of $250 million and provides $30 million in technical assistance for small businesses.

    -- BusinessLINC (Learning, Investment, Networking and Collaboration). The bill provides $7 million in funding for BusinessLINC -- an innovative public-private partnership launched by Vice Pres. Gore -- and designed to encourage large businesses to work with and mentor small business owners and entrepreneurs in economically-distressed communities.

    EMPOWERMENT ZONES: -- Strengthened & Expanded EZs. President Clinton and Vice President Gore proposed and signed Empowerment Zone legislation in 1993 establishing 9 EZs across the country -- today there are 31 across America. This agreement: -- A third round of 9 new EZs, bringing the total number to 40, and extends all EZs to 2009. -- An additional $110 million, for a total of $200 million in discretionary investment this year for existing EZs. -- Expansion of 20% EZ wage credit (first $15,000 in annual wages for each worker), increased small business expensing (up to $35,000 more than in current law for equipment), and enhanced tax-exempt bonds to all EZs. -- Tax-free rollovers for EZ investments, and 60% capital gains exclusion for investment in small EZ businesses.

    RENEWAL COMMUNITIES: -- The creation of 40 Renewal Communities designated by the U.S. Dept. of Housing and Urban Development with targeted, pro-growth tax benefits. Key incentives aimed at spurring investment in Renewal Communities include: -- Zero capital gains rate on the sales of certain assets held for more than 5 years. -- Increased small business expensing (up to $35,000 more than in current law for equipment). -- 15% employment wage credit (first $10,000 in annual income for each worker). -- Commercial revitalization deductions for taxpayers who revitalize buildings in a Renewal Community.

    In addition, the New Market/Renewal Communities legislation includes these 2 provisions:

    -- EXPANSION OF THE LOW INCOME HOUSING TAX CREDIT: To expand and improve the supply of available low-income housing, This bill increases the Low-Income Housing Tax Credit by more than 40% over two years and then indexes the credit for inflation thereafter. The increase will help to create an additional 180,000 units of affordable housing for working families over the next five years. The credit will increase to $1.50 per capita for each state in 2001 and $1.75 per capita in 2002.

    -- INCREASE IN THE PRIVATE ACTIVITY BOND CAP: The legislation increases the state private activity bond cap from $50 per resident to $75 per resident, phased in from 2001 to 2002. Private activity bonds allow states and municipalities to encourage economic growth in communities through the issuing of lower cost tax exempt bonds.
    

    ---

    BIPARTISAN AGREEMENT ON NEW MARKETS AND RENEWAL COMMUNITIES   Posted: April 10, 2002
    THE WHITE HOUSE

    Office of the Press Secretary ________________________________________________________________________ For Immediate Release May 23, 2000 | PRESIDENT CLINTON & SPEAKER HASTERT ANNOUNCE BIPARTISAN AGREEMENT

    ON NEW MARKETS AND RENEWAL COMMUNITIES

    Today, President Clinton will be joined by Speaker Dennis Hastert in announcing a bipartisan agreement on a New Markets and Community Renewal legislative initiative. This announcement is the outcome of the commitment President Clinton and Speaker Hastert made in Chicago last Nov. to develop a bipartisan legislative initiative on New Markets and revitalizing impoverished communities this year. This initiative will help encourage private sector equity investment in underserved communities throughout the country to ensure that all Americans share in our nation's economic prosperity. The President's New Markets Initiative was originally proposed in President Clinton and Vice-President Gore's FY 2000 budget. President Clinton has highlighted the potential of the nation's New Markets in three separate trips across America to underserved inner city and rural communities like Newark, NJ, Hartford, CT, the Mississippi Delta, Appalachia, and rural Arkansas, and the Pine Ridge Indian Reservation in S. Dakota.

    THE KEY ELEMENTS OF THE AGREEMENT ARE:

    NEW MARKETS INITIATIVES: -- The New Markets Tax Credit. Under this agreement, this credit will spur $15 billion in equity investment and will be available to taxpayers who invest in certain privately-managed investment funds and institutions, which, in turn, use these funds to finance businesses in low- and moderate-income communities. The proposal would provide a 30-percent credit (in present-value terms) for investments in a wide range of investment vehicles. Eligible investment companies include community development banks and other CDFI's, venture funds, and financial institutions such as the new investment company programs.

    -- America's Private Investment Companies (APICs). Just as America's support for the Overseas Private Investment Corporation helps promote growth in emerging markets abroad, APIC will encourage private investment in this country's untapped markets. Leveraging $2 for every $1 in private investment, the agreement authorizes HUD to guarantee up to $1 billion in low cost loans to match $500 million in private investment for a total of $1.5 billion in investments in underserved communities.

    -- New Markets Venture Capital (NMVC) Firms. NMVC firms will provide incentives to increase the availability of venture capital in low and moderate-income communities for small businesses. Expert guidance will also be made available to small business entrepreneurs in inner city and rural areas. Ten to twenty NMVC firms are planned. The agreement authorizes the SBA to guarantee up to $150 million in loans that will match $100 million in private equity for a total of $250 million. SBA will also have the authority to make $30 million in operating assistance grants to match equivalent private commitments.

    EMPOWERMENT ZONES: -- Expanded To 40 EZs & Strengthened EZs. President Clinton and Vice President Gore proposed and signed Empowerment Zone legislation in 1993 establishing 9 EZs across the country -- today there are 31 across America. This agreement: -- Designates a third round of 9 new Empowerment Zones (for a total of 40). -- Expands the Empowerment Zone tax incentives to form strategic partnership with all existing EZs so that all can utilize the 20% EZ wage credit, additional business expensing, and other incentives. -- Commits $200 million in discretionary investment this year for existing EZs. -- Establishes zero-rate capital gains rollover for investments within the EZ. -- A 60% capital gains exclusion for investment in small businesses. -- D.C. tax incentives would also be extended to 2009.

    RENEWAL COMMUNITIES: -- The creation of 40 Renewal Communities (32 urban, 8 rural), designated by the U.S. Dept. of Housing and Urban Development with targeted, pro-growth tax benefits, regulatory relief,. The tax benefits of Renewal Communities would address key hurdles facing small businesses when they are just getting started -- raising capital and maintaining cash flow. Key incentives aimed at spurring investment in Renewal Communities include: -- Zero Capital Gains Rate on the sales of assets held for more than 5 years. -- Increased Expensing for Small Businesses (up to $35,000 more than in current law for equipment). -- 15% Employment Wage Credit (up to $10,000 ) for each worker. -- Commercial Revitalization deductions for taxpayers who rehabilitate or revitalize buildings in a Renewal Community.

    In addition, the New Market/Renewal Communities Agreement includes these 2 provisions:

    -- EXPANSION OF THE LOW INCOME HOUSING TAX CREDIT: To expand and improve the supply of available low-income housing, this agreement increases the Low-Income Housing Tax Credit by more than 40% to build an additional 180,000 units of affordable housing for working families over the next five years.

    -- ALLOWING FAITH-BASED ORGANIZATIONS TO QUALIFY FOR SUBSTANCE ABUSE FUNDING: The initiative allows faith-based substance abuse prevention and treatment programs to qualify for federal funds on the same basis as other non-profits consistent with the 1996 Welfare Reform Act and the constitutional line between church and state.
    

    ---

    RENEWAL COMMUNITY TECHNICAL LEGISLATION   Posted: April 10, 2002
    Source: https://groups.google.com/groups?hl=en&threadm=2001CRE1866%40us.govnews.org&rnum=1&prev=/groups%3Fhl%3Den%26q%3Drenewal%2Bcommunity%26btnG%3DGoogle%2BSearch%26meta%3D

    Archive-Name: gov/us/fed/congress/record/2001/oct/12/2001CRE1866 [Congressional Record: October 12, 2001 (Extensions)] [Page E1866] From the Congressional Record Online via GPO Access [wais.access.gpo.gov] [DOCID:cr12oc01-36]

    RENEWAL COMMUNITY TECHNICAL LEGISLATION

    ______

    HON. JOHN J. LaFALCE

    of new york

    in the house of representatives

    Thursday, October 11, 2001

    Mr. LaFALCE. Mr. Speaker, today, along with Representatives Quinn and Reynolds, I will be introducing legislation designed to enhance the effectiveness of the ``Renewal Community'' program which Congress adopted just last December. This legislation would allow the expansion of Renewal Communities to include census tracts which are not eligible under 1990 census data, but which are eligible under 2000 census data. As Congress debates economic stimulus legislation, which is likely to include tax provisions, we urge inclusion of this simple, but important, legislative amendment to the existing Renewal Community program. Late last year, Congress enacted bi-partisan legislation authorizing the designation of forty ``Renewal Communities,'' each of which will receive substantial investment tax benefits. Applications for selection of these Renewal Communities are due late in October, with final selection by HUD under a competitive process before the end of this year. All census tracts in a Renewal Community application must meet objective criteria, including benchmarks relating to poverty and unemployment. However, the poverty rates and population used to determine compliance with such criteria are required to be determined using 1900 census data. Use of dated economic data was probably necessary, given that the selection process will be completed before all 2000 census data is available. However, ironically, the result is that legislation designed to rejuvenate areas with rising poverty and declining economic conditions and population effectively ignores what has taken place over the last decade. The very census tracts that have declined economically over the last decade, as confirmed by objective economic data, are unnecessarily excluded from favorable investment treatment designed to reverse such economic decline. This makes no sense. Therefore, the legislation we are introducing today in a simple one, which permits applicants that are awarded Renewal Community status to subsequently apply to HUD to expand their boundaries to include census tracts that did not meet the legislation's poverty or population criteria using 1990 census data, but would meet such criteria using 2000 census data. It does not interfere with the selection process for the forty Renewal Communities, which is already underway. Nor does it alter the objective qualifications that each census tract must meet to qualify for inclusion in a Renewal Community. It merely allows Renewal Communities selected later this year to apply for the inclusion of adjacent census tracts that clearly justify inclusion in the Renewal Community, based on our most recent census data.

    
    

    ---

    Rural Development: New Approach to Empowering Communities Needs Refinement   Posted: April 10, 2002
    info@www.gao.gov (info@www.gao.gov)

    Archive-Name: gov/us/fed/congress/gao/reports/1997/rc97075.txt/part1 Message-ID: MIME-Version: 1.0

    Rural Development: New Approach to Empowering Communities Needs Refinement (Letter Report, 03/31/97, GAO/RCED-97-75).

    Pursuant to a congressional request, GAO reviewed selected aspects of the Department of Agriculture's (USDA) rural Empowerment Zone/Enterprise Community (EZ/EC) Program, focusing on: (1) the federal funding levels of the rural EZ/EC program over the 10-year life of the program; (2) the status of the implementation of the program; (3) the difficulties that the communities have encountered in implementing their plans; and (4) USDA's oversight of the program.

    GAO noted that: (1) it estimates that federal funding for the rural EZ/EC program will total more than $1 billion over the 10-year life of the program; (2) this amount includes the $208 million in EZ/EC funds from the Social Services Block Grant (SSBG) program and an estimated $428 million from tax incentives; (3) estimates for direct funding from federal, state, and local programs as well as private sources are not generally available; (4) however, one federal agency, USDA, reports that it plans to provide about $246 million to the rural EZs and ECs over the first 4 years alone and that its funding for the 10-year life of the program could reasonably be expected to reach $600 million; (5) the status of the communities' implementation of the EZ/EC program varies; (6) all 33 rural EZs and ECs have established the basic organizational structures and procedures necessary to implement their strategic plans; (7) in terms of implementing the projects contained in these plans, such as day care services, emergency 911 services, and job training, some communities have made considerable progress and some have made very little; (8) the rural EZs and ECs have experienced a number of difficulties that have slowed their initial efforts, continue to impede their progress, or both; (9) these difficulties include the short time frames provided for applying to the program and the initial misinformation provided by officials at USDA headquarters about the program's basic operations; (10) while some of these difficulties have been or are in the process of being resolved, two issues continue to be of concern; (11) these issues are a lack of clarity about which federal regulations are applicable to the construction projects funded by EZ/EC Social Services Block Grants, and the conflict between the verbal guidance and the written guidance that the Department of Health and Human Services has provided to the states on their responsibilities for ensuring that funds are reasonably and prudently spent; (12) under the EZ/EC program, USDA is responsible for overseeing the progress of the rural EZs and ECs and USDA is to accomplish this oversight through reviews of the periodic reports submitted by the EZs and ECs and by site visits conducted by USDA field personnel, known as EZ/EC state coordinators; (13) however, USDA cannot adequately fulfill its oversight responsibilities because the EZs, the ECs, and the EZ/EC state coordina*

    --------------------------- Indexing Terms -----------------------------

    REPORTNUM: RCED-97-75 TITLE: Rural Development: New Approach to Empowering Communities Needs Refinement DATE: 03/31/97 SUBJECT: Rural economic development Community development programs Block grants Communication Tax credit Federal aid to localities Strategic planning Reporting requirements Financial management IDENTIFIER: USDA Rural Empowerment Zones and Enterprise Communities Program Social Services Block Grant Water and Waste Disposal Grant RDA Water and Waste Disposal Loan Program Rural Business Enterprise Grant Community Development Block Grant

    ****************************************************************** ** This file contains an ASCII representation of the text of a ** ** GAO report. Delineations within the text indicating chapter ** ** titles, headings, and bullets are preserved. Major ** ** divisions and subdivisions of the text, such as Chapters, ** ** Sections, and Appendixes, are identified by double and ** ** single lines. The numbers on the right end of these lines ** ** indicate the position of each of the subsections in the ** ** document outline. These numbers do NOT correspond with the ** ** page numbers of the printed product. ** ** ** ** No attempt has been made to display graphic images, although ** ** figure captions are reproduced. Tables are included, but ** ** may not resemble those in the printed version. ** ** ** ** Please see the PDF (Portable Document Format) file, when ** ** available, for a complete electronic file of the printed ** ** document's contents. ** ** ** ** A printed copy of this report may be obtained from the GAO ** ** Document Distribution Center. For further details, please ** ** send an e-mail message to: ** ** ** ** ** ** ** ** with the message 'info' in the body. ** ******************************************************************

    Cover ================================================================ COVER

    Report to the Committee on Agriculture, Nutrition, and Forestry

    March 1997

    RURAL DEVELOPMENT - NEW APPROACH TO EMPOWERING COMMUNITIES NEEDS REFINEMENT

    GAO/RCED-97-75

    Rural Development

    (150424)

    Abbreviations =============================================================== ABBREV

    EC - Enterprise Community EZ - Empowerment Zone HHS - Department of Health and Human Services SSBG - Social Services Block Grant USDA - U.S. Department of Agriculture EZ/EC - SSBG -

    Letter =============================================================== LETTER

    B-276194

    March 31, 1997

    The Honorable Richard G. Lugar Chairman The Honorable Tom Harkin Ranking Minority Member Committee on Agriculture, Nutrition, and Forestry United States Senate

    The Empowerment Zone/Enterprise Community (EZ/EC) program was created by the Congress in 1993 to help distressed communities develop comprehensive approaches for dealing with their social and economic problems. The program is unique in its reliance upon the participating communities' own approaches and strategic plans for improvement. In addition, the program fosters partnerships between a variety of social service and economic resources, including those available through federal and state programs, private and nonprofit organizations, and others. Of the 227 rural communities nationwide that applied to the program, the Secretary of Agriculture, in December 1994, designated three rural areas as EZs and 30 as ECs, primarily on the basis of their strategic plans. 1 Over a 10-year period, both the EZs and the ECs will receive federal assistance through EZ/EC Social Services Block Grants (SSBG) and special tax incentives, technical assistance, and special consideration in many federal competitive grant and loan programs. Each of the EZs will receive $40 million over the 10-year life of the program; each of the ECs will receive about $3 million. Additionally, the businesses located in the EZs are eligible for more tax incentives than the businesses in the ECs. Several proposals have recently been introduced into the Congress to expand or revise the EZ/EC program.

    This report responds to your request that we review selected aspects of the rural EZ/EC program. Specifically, you asked that we (1) estimate the federal funding levels of the rural EZ/EC program over the 10-year life of the program, (2) determine the status of the implementation of the program, (3) identify the difficulties that the communities have encountered in implementing their plans, and (4) examine the U.S. Department of Agriculture's (USDA) oversight of the program. We visited all 3 of the rural EZs and 5 of the 30 rural ECs. Additional information about the communities we visited is provided in appendix I.

    -------------------- 1 This report focuses on rural areas. We reported on the status of urban EZs in Community Development: Status of Urban Empowerment Zones (GAO/RCED-97-21, Dec. 20, 1996).

    RESULTS IN BRIEF ------------------------------------------------------------ Letter :1

    We estimate that federal funding for the rural EZ/EC program will total more than $1 billion over the 10-year life of the program. This amount includes the $208 million in EZ/EC funds from the Social Services Block Grant program and an estimated $428 million from tax incentives. Estimates for direct funding from federal, state, and local programs as well as private sources are not generally available. However, one federal agency, USDA, reports that it plans to provide about $246 million to the rural EZs and ECs over the first 4 years alone and that its funding for the 10-year life of the program could reasonably be expected to reach $600 million.

    The status of the communities' implementation of the EZ/EC program varies. All 33 rural EZs and ECs have established the basic organizational structures and procedures necessary to implement their strategic plans. In terms of implementing the projects contained in these plans (such as day care services, emergency 911 services, and job training), some communities have made considerable progress and some have made very little.

    The rural EZs and ECs have experienced a number of difficulties that have slowed their initial efforts, continue to impede their progress, or both. These difficulties include the short time frames provided for applying to the program and the initial misinformation provided by officials at USDA headquarters about the program's basic operations. While some of these difficulties have been or are in the process of being resolved, two issues continue to be of concern. These issues are (1) a lack of clarity about which federal regulations are applicable to the construction projects funded by EZ/EC Social Services Block Grants and (2) the conflict between the verbal guidance and the written guidance that the Department of Health and Human Services has provided to the states on their responsibilities for ensuring that funds are reasonably and prudently spent.

    Under the EZ/EC program, USDA is responsible for overseeing the progress of the rural EZs and ECs; the Department is to accomplish this oversight through reviews of the periodic reports submitted by the EZs and ECs and by site visits conducted by USDA field personnel, known as EZ/EC state coordinators. However, USDA cannot adequately fulfill its oversight responsibilities because the EZs, the ECs, and the EZ/EC state coordinators do not provide USDA with complete and systematic progress reports. Consequently, USDA lacks the basic management information for identifying problem areas.

    BACKGROUND ------------------------------------------------------------ Letter :2

    The Congress established the EZ/EC program in the Omnibus Budget Reconciliation Act of 1993 (P.L. 103-66, Aug. 10, 1993). Under the act, the communities that wanted to participate in the program had to (1) meet specific criteria for characteristics such as geographic size and poverty rate and (2) prepare a strategic plan for implementing the program. The act also specified that the Secretary of Agriculture could designate up to 3 rural EZs and 30 rural ECs on the basis of their strategic plans.

    The act also amended title XX of the Social Security Act to authorize the use of the EZ/EC SSBG funds for the program and placed increased authority for funding decision-making with the local EZ/EC governance structures. Historically, the funds from the SSBG program that were allocated to the states could be used only for social service activities, such as programs to assist and feed children. However, under the EZ/EC program, the act expanded the permissible uses of the SSBG's funds by allowing their use for such activities as purchasing or improving land and facilities or for providing cash payments to individuals for medical care.

    In addition to the EZ/EC SSBG funds, all of the designated communities are expected to receive several types of federal assistance. The businesses located in the EZs and the ECs are eligible for low-interest loans, resulting from the tax-exempt bonds issued by the state or local governmental unit, to be used to provide facilities and land for the businesses in the communities. In addition, the businesses located within EZs (1) are eligible to receive tax credits on the wages paid to the employees who live and work in the EZ and (2) may deduct higher levels of depreciation expenses. A number of federal departments and agencies also made a commitment to give all EZs and ECs special consideration in the competitions for funds from many other federal programs and to work cooperatively with them in overcoming regulatory impediments.

    The federal assistance received by the EZs and ECs must be spent in accordance with the communities' strategic plans. These plans outline how the communities would achieve their goals, including ensuring the active participation of the members of the community, the local private and nonprofit entities, and the federal, state, and local governments. The EZs' and ECs' progress in achieving their goals is to be based on the performance benchmarks established by the communities, not on the amount of federal money spent. These benchmarks explain in some detail how the locality intends to achieve its goals. The benchmark document, which becomes a part of the overall plan, includes the specific projects that the EZ or EC will undertake and timelines showing when the projects will be instituted or completed. The benchmark document, which generally looks ahead 2 years, requires continuous review and modifications to accommodate the changes in the community's needs as well as scheduling problems. These benchmark projects are to serve the EZs and ECs, as well as USDA, as an important management tool and provide the primary basis for evaluating the progress being made.

    The Department of Health and Human Services (HHS), USDA, and the states play key roles in administering the program. 2 HHS makes grants to the states, and the designated state agency obligates the funds to the EZs and ECs as it receives, reviews, and approves requests from them to draw down funds for a particular benchmark project. In addition, the state must ensure that the requested expenditure is allowable under the state's standards. USDA, as the lead federal agency for the rural EZ/EC program, is responsible for helping the rural EZs and ECs achieve their goals by evaluating their progress and providing technical assistance.

    -------------------- 2 In addition to HHS and USDA, at least 13 other agencies have agreed to support the program. The federal agencies involved in the program meet periodically through a Community Empowerment Board, chaired by the Vice President, to exchange information on the program's operations.

    FEDERAL FUNDING FOR THE RURAL EZ/EC PROGRAM IS LIKELY TO TOTAL OVER $1 BILLION ------------------------------------------------------------ Letter :3

    The federal funds invested in the rural EZ/EC program, including loans, grants, and forgone tax revenues, will far exceed the $208 million in EZ/EC SSBG funds allocated to the program. In fact, we estimate that federal funds exceeding $1 billion will be invested in the program over its 10-year life. This estimate includes the EZ/EC SSBG funds, 3 plus an estimated $428 million from tax incentives and about $600 million from USDA's loan and grant programs. This $1 billion estimate does not include the other significant sources of investments in the program that will be provided by other federal agencies. Estimates from these sources were not available. If the program is successful, some offsetting benefits, such as loan repayments, increased tax revenue, and reduced welfare costs, should occur in the communities.

    -------------------- 3 By December 1996, the entire $208 million was obligated by the participating states. As of that date, the 33 EZs and ECs had drawn down $36 million of the $208 million.

    FEDERAL TAX INCENTIVES WILL BE ABOUT $428 MILLION ---------------------------------------------------------- Letter :3.1

    The EZ/EC program has made three tax incentives available to the communities for economic development. The first two, available only to EZs, are (1) the Empowerment Zone Employment Credit, which provides qualified employers with a tax credit of up to $3,000 for each employee who lives and works in the EZ, and (2) the Empowerment Zone Expensing Allowance, which allows a qualified business to take a special depreciation deduction of up to $20,000 (for an annual total of up to $37,500) for equipment purchases each year. The third incentive, available to both the EZs and the ECs, is the Enterprise Zone Facility Bond, which provides up to $3 million in tax-exempt bond financing to qualified businesses for buildings or equipment.

    Using the data and assumptions from the Internal Revenue Service, we estimate that the cost of the EZ/EC tax incentives in rural areas will be about $428 million over the 10-year period. The EZs' employment credit will account for $406.5 million of that total; the facility bonds and the expensing allowances will make up the remainder at $4.3 million and $17.2 million, respectively.

    INCOMPLETE INFORMATION IS AVAILABLE ON THE EXTENT OF PREFERENTIAL TREATMENT ---------------------------------------------------------- Letter :3.2

    USDA, HHS, and 13 other federal agencies have agreed to give special consideration to eligible EZ/EC applicants by giving them preferential treatment for funds from the agencies' existing funding sources over the life of the program. Most federal agencies had not estimated the amount of support they expect to invest in the rural EZs and ECs over the 10-year life of the program. USDA, however, indicated that it alone intends to provide about $246 million to rural EZs and ECs over the first 4 years through existing funding sources such as its Rural Business Enterprise Grant program and the Water and Waste Disposal Loan and Grant programs. If this funding level is maintained over the 10-year life of the program, an assumption that USDA officials consider a reasonable expectation, USDA will provide about $600 million to EZ/EC communities. USDA officials noted that these funds, as well as those from the other agencies that have pledged to provide special consideration to EZ/ECs, represent existing appropriations that would be expended--not new moneys.

    In addition to the funds provided by federal agencies, the rural EZs and ECs are expected to obtain assistance from state, local, and private sources. Some EZs and ECs are using the EZ/EC SSBG funds as seed money to attract even larger amounts from nonfederal sources, such as foundations. USDA provided data showing that for the 3 EZs and 25 of the ECs, the communities were receiving more than one dollar from their state and local governments and from private and nonprofit organizations for every dollar of EZ/EC SSBG funds received. To the extent that the loans are repaid and that new jobs result in increased tax revenues and reduced welfare payments, the federal investment in the rural EZ/EC program will be offset.

    EZS AND ECS VARY IN THEIR PROGRESS TOWARD IMPLEMENTING THE PROGRAM ------------------------------------------------------------ Letter :4

    The 33 EZs and ECs have established the structures and procedures needed to implement their strategic plans. Nevertheless, the boards of directors for two of the ECs we visited were experiencing problems that could hinder their progress toward completing their benchmark projects. Overall, progress on these projects has varied widely.

    MOST EZS AND ECS HAVE CREATED THE BASIC FOUNDATION FOR MANAGING DEVELOPMENT ---------------------------------------------------------- Letter :4.1

    According to USDA officials, all communities have taken the initial necessary actions to manage and begin implementing their strategic plans, such as establishing a board structure and basic operating principles. These actions had to be formally agreed upon by the community, the state, and USDA in a memorandum of agreement. In order to complete a memorandum of agreement, the communities had to, among other things, establish their benchmarks and develop a budget for the first 2 years of implementation; create the bylaws and/or articles of incorporation for the group, known as the lead entity, that will manage the EZ or EC program; and establish the EZ's or EC's board structure. In addition, USDA reviewed the documents prepared by the lead entities to ensure that they had a policy to prevent conflicts of interest and strategies for ensuring broad participation within the community. 4

    We visited all three EZs and found that they were generally well-organized to manage the implementation of their strategic plans. For example, while the geographical boundaries of all of the EZs cut across several local government boundaries, such as county lines, they had all developed mechanisms for overcoming the potential problems in having the EZ work with more than one political entity. One EZ that spanned parts of four counties created four subzone boards to overcome the political divisions inherent in its organization. These subzones consider the communities' proposals for implementing the benchmark projects that originate in their area. The proposals approved at the subzone level are then considered by the EZ's full board. As of June 1996, nearly 1 year after the memorandum of agreement, the EZ reported some progress toward 45 of the 49 projects serving the subzones. Some of these projects served several subzones, while others served only one.

    Although the EZs appear to be well organized, two of the ECs that we visited were experiencing problems. For example, at one EC we visited, the board members were in such disagreement with the lead entity over the control of the EC funds that little business has been conducted, and the program has not been moving forward. At another EC, the state agency found that the board members were, among other things, submitting applications for projects that would benefit them financially.

    -------------------- 4 As of January 3, 1997, USDA was able to document that these actions had been completed for 23 out of the 33 communities. However, USDA could not locate the files for all of these actions for the remaining 10 ECs. As a result of our review, USDA officials told us that they will take steps to create a central filing system for the reports submitted by the EZs and ECs.

    EZS AND ECS VARY IN IMPLEMENTING THEIR BENCHMARK PROJECTS ---------------------------------------------------------- Letter :4.2

    USDA requires EZs and ECs to report periodically on the progress they are making toward implementing the benchmark projects. These projects include such things as constructing child care facilities, initiating job training programs, beginning 911 emergency response services, and improving wastewater systems. While USDA has not received complete progress reports from all communities, the progress made by those that have reported varied widely.

    USDA had sufficient centralized information on 14 communities for us to determine whether (1) progress had been made toward implementing the benchmark projects scheduled to start before December 1996 and (2) the projects that were scheduled to be completed prior to December 1996 had in fact been completed. 5 Progress, by these measures, varied widely among the 14 communities we examined. For example, one community reported that it had made at least some progress toward implementing all of the benchmark projects scheduled to start prior to December 1996 and that one project had been completed. On the other hand, two communities reported that either no progress had been made on projects or that they had not finished any of the projects scheduled for completion prior to December 1996. Overall, 8 of the 14 communities reported that they had not started or completed at least 50 percent of their benchmark projects on time.

    Appendix I presents information on selected benchmark projects at the eight communities we visited.

    -------------------- 5 We found that 21 communities had at least partially reported on their progress as of January 1, 1997. We did not include 7 of the 21 communities in our analysis because they had reported on their progress for less than 60 percent of their projects or had met less than 60 percent of their planned start and end dates.

    EZS AND ECS HAVE FACED A NUMBER OF DIFFICULTIES IN IMPLEMENTING THEIR PLANS ------------------------------------------------------------ Letter :5

    The rural EZs and ECs have experienced difficulties that have slowed their initial efforts, continue to impede their progress, or both. The difficulties were the short time frame allowed for applying to the program and the misinformation provided by officials at USDA headquarters about the program's basic operations. While these difficulties have been or are in the process of being resolved, two other issues continue to be of concern. These issues are a lack of clarity about which standards the communities should follow for construction projects when using EZ/EC SSBG funds and the disparity between HHS' verbal guidance and written guidance to the states on their responsibilities for releasing the EZ/EC SSBG funds to the communities for the EZ/EC program.

    SHORT TIME FRAMES CAUSED ORGANIZATIONAL AND PLANNING CONCERNS FOR COMMUNITIES ---------------------------------------------------------- Letter :5.1

    Officials at each of the rural EZs and ECs we visited commented that the period for preparing an application for the EZ or EC designation was too short for the amount of work required. The communities applying for the program had 5-1/2 months after the President announced the program to submit an application. During that time, they had to achieve grass-roots involvement, gain consensus on the needs and vision of the community, elect a board of directors, produce a strategic plan, and prepare to begin operating. These tasks were particularly difficult to carry out in rural areas that often (1) did not have organized coalitions or the expertise available to articulate a vision and develop a complex strategic plan and (2) are spread out over a large geographical area, which makes putting together all parts of the application more difficult.

    While the communities met their application deadlines, some officials believe that a longer period to organize would have allowed them to better galvanize the public's support and involvement and that, in some instances, they would have been better able to identify their needs and establish appropriate goals.

    USDA and HHS officials acknowledged that the communities faced short time frames. Some USDA officials stated that the short time frames required that the rural communities act quickly both to generate local involvement and to create the vision and strategic plan required to meet the application deadline. They noted that the federal agencies involved faced organizational pressures as well. The EZ/EC program's timetable required the federal agencies to develop their coordination strategy, perform detailed planning, hire and train staff, and begin operating the program within the 16 months between the passage of the legislation and the designation of the EZs and the ECs.

    HHS and USDA officials generally agreed that, should a second round of EZs and ECs be authorized, it may be beneficial to allow the communities a somewhat longer time to apply in order to facilitate broader public involvement and a fuller consideration of the vision and the steps needed to accomplish it. Furthermore, some officials said that, if a second round is authorized, the federal government may need to provide more guidance on how to prepare the application documents to ensure a somewhat greater uniformity than they had experienced in the current program.

    EARLY MISSTATEMENTS BY USDA OFFICIALS CONTRIBUTED TO IMPLEMENTATION PROBLEMS ---------------------------------------------------------- Letter :5.2

    At seven of the eight rural EZs and ECs we visited, officials noted that erroneous information, provided primarily by officials from USDA headquarters at meetings around the nation, caused misunderstandings about the operations of the EZ/EC program. At some of the meetings, the federal headquarters officials said that the EZs and ECs would receive the EZ/EC SSBG funds directly. Two of the EZs expected to receive the total amount of the EZ/EC SSBG funds--$40 million--in two consecutive annual payments, while some ECs believed that they would receive their total payment of about $2.9 million shortly after they were selected. In fact, as we discussed earlier, the communities are receiving their funding incrementally through the state agency as needed to pay for benchmark activities. Furthermore, some communities were told, incorrectly, that they did not have to get approval from any federal or state entity to use the funds for projects that were consistent with the strategic plan.

    The incorrect information provided by USDA officials caused difficulties for several state agencies and rural communities. For example, one EC had to revise its plan when it learned how the funds were actually to be distributed. The community had planned to obtain the lump-sum payment, put it into an interest-bearing account, and use the interest, which would have been considerable, to fund some part of certain projects. Since no lump sum was made available, the EC revamped its plan to obtain alternative sources of funding for some of its projects.

    HHS HAS NOT PROVIDED CLEAR GUIDANCE ON THE APPLICABILITY OF FEDERAL STANDARDS ---------------------------------------------------------- Letter :5.3

    Several of the EZs and ECs that we visited have encountered some difficulty in sorting out which federal standards apply to certain types of projects financed with EZ/EC SSBG funds. Those funds can be used for construction projects, such as water and sewer proposals, if the projects are related to one of the program's goals, such as providing training to disadvantaged youth. However, the act did not specify any standards for these new allowable uses. As a result, the communities have been deciding for themselves which construction standards they will follow.

    The communities have taken different approaches to address this difficulty. For example, officials at one EZ seeking to build a water system told us that they were unable to get guidance from HHS and decided to follow the environmental regulations that they considered most appropriate--those governing the use of the Department of Housing and Urban Development's Community Development Block Grant program--for that project and for any other project that might involve environmental issues. Faced with a similar dilemma, another EZ took a different approach, deciding to follow the environmental regulations associated with the primary funding source for a given project.

    Some rural EZ officials seeking clarification on this issue contacted HHS, which oversees the EZ/EC SSBG funds. According to these officials, HHS did not indicate what construction standards should be used. Consequently, the community officials have used their best judgment on how to proceed with specific projects and activities. Some EZ officials added that they are concerned that they may be legally liable if they choose to follow an incorrect standard and may have to replace such things as improperly sized water or sewer pipes, thereby incurring considerable costs and causing disruption.

    HHS' VERBAL INSTRUCTIONS TO THE STATES ON ADMINISTERING EZ/EC SSBG FUNDS APPEAR TO CONFLICT WITH HHS' REGULATIONS ---------------------------------------------------------- Letter :5.4

    According to the HHS regulations and the Terms and Conditions of the EZ/EC program, the financial standards that the states are to apply in administering the EZ/EC SSBG funds are the standards that they use for expending their own state funds. However, officials in three of the states we visited told us that HHS program officials had verbally appealed to them to be flexible in applying their standards.

    This conflicting guidance has led to disagreements between some of the state agencies and the EZs and ECs over who has oversight responsibility. For example, when one EC requested a drawdown of funds for expenses that included liquor, the state agency disallowed payment for the liquor. The state agency argued that Office of Management and Budget Circular A-87, the standard adopted by the state, did not allow expenditures of federal funds for liquor. State agency officials told us that HHS verbally asked the state agency to be flexible and allow the expenditure and advised them not to worry about having to repay the expenditure at a later date. The state agency officials told us that they wanted to cooperate with HHS in the EZ/EC program, but they also wanted the state to comply with its own regulations, including Circular A-87. The state ultimately disallowed the expenditure.

    In another state, the EZ submitted 22 project proposals to the state agency for its review prior to a formal request to draw down funds. According to state agency officials, the proposals did not meet the state's fiscal standards in that most of the proposals had budgets that were inconsistent with reasonable and prudent business practices. These budgets reportedly included such items as salaries and fringe benefits that were above the industry's average. State officials told us that HHS had appealed to them on numerous occasions to be more flexible in their reviews of the EZ's proposals. As of February 3, 1997, the state had approved no funds for these 22 proposals.

    USDA CANNOT ADEQUATELY OVERSEE THE IMPLEMENTATION OF THE EZ/EC PROGRAM ------------------------------------------------------------ Letter :6

    Under the EZ/EC program, USDA's Office of Community Development is responsible for overseeing the participating rural EZs and ECs. It is to carry out its responsibilities through site visits by USDA state coordinators 6 and USDA headquarters' reviews of the progress reports periodically submitted by the EZs and ECs. However, USDA cannot adequately fulfill its oversight responsibilities because it has not received complete progress reports from all of the USDA state coordinators or the EZs and ECs.

    USDA's EZ/EC state coordinators do not provide systematic reporting on the progress of rural EZs and ECs. Among other things, the state coordinators are responsible for reviewing all benchmark changes to ensure the communities' participation and conformance with the strategic plan. They are also involved with the initial approval of these changes. Most of these coordinators, who were chosen from the existing staff at the USDA state offices, have had little experience in overseeing the broad range of a community's economic and social development projects and have not received training in how to monitor and report on the communities' progress. USDA officials agreed that their EZ/EC state coordinators needed training but told us that funding constraints prevented them from developing and offering oversight training.

    Oversight is further hampered because the EZs and ECs are not consistently reporting their progress to USDA. USDA's regulations require the EZs and ECs to report their progress at least annually. However, as noted earlier, the information provided is inadequate. Only 14 of the 33 communities had provided systematic information on their progress as of January 1, 1997.

    -------------------- 6 Although the state coordinators have the primary responsibility for site visits, USDA headquarters staff also perform site visits for community review and intervention purposes.

    CONCLUSIONS ------------------------------------------------------------ Letter :7

    As a new approach to providing development assistance to rural areas, the EZ/EC program has faced a number of problems, several of which were associated with the program's start-up and are no longer of immediate concern. However, some issues related to the guidance for the program continue to cause confusion among the program's participants and could hamper the program's progress. These issues include (1) the absence of written guidance defining the standards to be followed when using EZ/EC SSBG funds for construction-related projects and (2) conflicting guidance about the fiduciary responsibilities that the participating states should exercise for ensuring that the EZ/EC SSBG funds are spent in accordance with the appropriate financial standards.

    Additionally, in view of the significant level of federal funds supporting rural EZs and ECs, it is important that USDA have a sufficient capability to oversee the progress that these communities are making in implementing the program. USDA's current oversight system, however, provides only piecemeal information on the EZs' and ECs' progress. As a result, USDA lacks the systematic information necessary for overseeing the program, including identifying problems and helping the communities to develop solutions.

    RECOMMENDATIONS TO THE SECRETARY OF HEALTH AND HUMAN SERVICES ------------------------------------------------------------ Letter :8

    To reduce confusion about the program's guidance on the uses of and financial controls over the EZ/EC SSBG funds, the Secretary of Health and Human Services should direct the Assistant Secretary for Planning and Evaluation to (1) clarify which construction-related standards the EZs and ECs should follow in using the EZ/EC SSBG funds and (2) eliminate the conflicts between the Department's verbal and written guidance on the states' fiduciary responsibility for the EZ/EC SSBG funds.

    RECOMMENDATION TO THE SECRETARY OF AGRICULTURE ------------------------------------------------------------ Letter :9

    To improve USDA's oversight of the EZ/EC program, the Secretary of Agriculture should instruct the Director of the Office of Community Development to upgrade the Office's monitoring system so that it can routinely provide the necessary information for assessing the progress of the EZs and ECs in implementing the program. This action could be accomplished by more strictly enforcing the EZs' and ECs' current self-reporting requirements and by developing more systematic reporting requirements for USDA's EZ/EC state coordinators.

    AGENCY COMMENTS AND OUR EVALUATION ----------------------------------------------------------- Letter :10

    We provided copies of the draft report for review and comment to USDA and HHS. These agencies' written comments and our responses appear in appendixes III and IV, respectively.

    In commenting on the draft, USDA noted that it concurred with our conclusions and was implementing changes in response to our recommendation. USDA also made a number of comments about the difficulties of beginning a new kind of program, and we have revised our report, where appropriate, to reflect these comments. In particular, USDA concurred with our finding that the time frames for communities to apply for EZ/EC status were short and that should a second round of EZs and ECs be authorized, the Department would expect to be more fully staffed and able to better assist the applicants, both through direct guidance and with a more structured application format. USDA also made a number of comments about our analysis of the federal investment in the EZ/EC program and provided additional information about the Department's future anticipated financial support of rural EZs and ECs. We have included this additional information and revised our estimates in consultation with USDA program officials.

    In their comments on the draft report, HHS officials stated that they will work to clarify several issues raised in the report, including the applicability of construction standards and federal fiscal standards to the program. HHS officials also suggested a number of changes to the report that would, among other things, clarify local, state, and federal roles in the EZ/EC program. Furthermore, these officials emphasized the need for flexibility in administering the program so that it can achieve its full potential. We incorporated these comments where appropriate.

    We also sent the detailed information on each EZ and EC we visited (as presented in app. I) to the cognizant local officials for their review and comment. We made several technical changes in response to the comments we received. In addition, we sent the sections of the report describing the problems resulting from the conflict between HHS' written and verbal guidance on financial standards to the cognizant state government officials for review and comment; these officials concurred in our presentation of the issues discussed in the report.

    SCOPE AND METHODOLOGY ----------------------------------------------------------- Letter :11

    We conducted our review from June 1996 through February 1997 in accordance with generally accepted government auditing standards. Our scope and methodology are discussed in more detail in appendix II.

    --------------------------------------------------------- Letter :11.1

    As agreed with your offices, unless you publicly announce its contents earlier, we plan no further distribution of this report until 15 days from the date of this letter. At that time, we will send copies of this report to the House Committee on Agriculture, other interested congressional committees, the Secretaries of Agriculture and Health and Human Services, the Director of the Office of Management and Budget, and other interested parties. We will also make copies available upon request.

    If you have any questions about this report, please call me at (202) 512-5138. Major contributors to this report are listed in appendix V.

    Robert A. Robinson Director, Food and Agriculture Issues

    DESCRIPTION OF THE EMPOWERMENT ZONES AND ECONOMIC COMMUNITIES GAO VISITED =========================================================== Appendix I

    KENTUCKY HIGHLANDS EMPOWERMENT ZONE --------------------------------------------------------- Appendix I:1

    Figure I.1: Kentucky Highlands Empowerment Zone

    (See figure in printed edition.)

    GOVERNANCE ------------------------------------------------------- Appendix I:1.1

    The Kentucky Highlands Investment Corporation is the lead entity for the Empowerment Zone (EZ); this Corporation was created in 1968 to foster economic development in the area. A steering committee consisting of representatives from each of the three subzone areas was established; an effort was made to ensure that the committee was balanced in terms of geographical representation, income, and expertise. The steering committee also includes representatives from the Board of Directors of the Kentucky Highlands Investment Corporation, local and state governments, economic development agencies, universities, and local residents. The steering committee has the overall responsibility for implementing the strategic plan and for providing guidance throughout the implementation of the plan.

    FUNDING ------------------------------------------------------- Appendix I:1.2

    The Empowerment Zone/Enterprise Community Services Block Grant (EZ/EC SSBG) funds for the EZ pass through the Kentucky Department of Financial Incentives to the Kentucky Highlands Empowerment Zone for its use. As of December 31, 1996, the EZ had obtained about $7.4 million of its allocated EZ/EC SSBG funds for use in its projects.

    STRATEGIC PLAN ------------------------------------------------------- Appendix I:1.3

    The EZ's strategic plan sets forth a four-pronged approach to revitalizing the communities included within the Zone: developing economic opportunity; promoting tourism; building infrastructure; and enhancing the quality of life. The EZ has 24 benchmarks. The projects include the following:

    -- establishing a development venture capital fund to invest in businesses located within the EZ;

    -- starting 150 home-based businesses in each of the three subzone areas, including training the home keyers to perform data entry work and assisting them in purchasing the computer equipment;

    -- building and equipping four rural fire stations within the EZ; and

    -- expanding a county library and increasing its telecommunications capacity.

    MID-DELTA EMPOWERMENT ZONE ALLIANCE --------------------------------------------------------- Appendix I:2

    Figure I.2: Mid-Delta Empowerment Zone Alliance

    (See figure in printed edition.)

    GOVERNANCE ------------------------------------------------------- Appendix I:2.1

    The Mid-Delta Empowerment Zone Alliance originated in January 1994 as a collaborative arrangement between The Delta Foundation and The Delta Council, representing poor minority and more affluent white interests, respectively. These two organizations came together to develop a strategic plan to benefit all citizens of the area, to apply for the EZ/EC program, and to establish the Alliance.

    The Mid-Delta Empowerment Zone Alliance Commission was formed in April 1994; it includes representatives from--among other elements--businesses, churches, colleges, community groups, low-income groups, and public schools from all areas of the zone. The Commission reviews and votes on all proposals for projects to address the benchmark projects on the strategic plan.

    FUNDING ------------------------------------------------------- Appendix I:2.2

    The EZ/EC SSBG funds pass through the Mississippi Department of Human Services to the Mid-Delta Empowerment Zone Alliance for its use. As of December 31, 1996, the EZ had obtained about $221,000 of its allocated EZ/EC SSBG funds for use in its projects.

    STRATEGIC PLAN ------------------------------------------------------- Appendix I:2.3

    The EZ's strategic plan focuses on three themes: building community in the Mississippi Delta, increasing economic opportunity in Mississippi Delta communities, and sustaining community and economic development in Mississippi Delta communities. The EZ has 41 benchmarks. Specific projects for the EZ include the following:

    -- expanding and strengthening businesses and industries by providing assistance in accessing capital, business and technical assistance, and marketing;

    -- improving the quality and accessibility of health care by seeking to increase the number of doctors serving the Mid-Delta region;

    -- improving race relations by creating a race relations council; and

    -- promoting community beautification through the creation of a recycling program.

    RIO GRANDE VALLEY EMPOWERMENT ZONE --------------------------------------------------------- Appendix I:3

    Figure I.3: Rio Grande Valley Empowerment Zone

    (See figure in printed edition.)

    GOVERNANCE ------------------------------------------------------- Appendix I:3.1

    The lead entity is the Rio Grande Valley Empowerment Zone Corporation, which was created to manage the EZ and implement the strategic plan; the corporation is headed by a chief executive officer who manages a small staff. The Corporation reports to a 19-member board of directors, the majority of whom were appointed by the county judges of the four counties. The board members include two directors from each of the four counties' subzone advisory committees. Each of the four counties appoints a subzone advisory committee for advocating matters within the subzone; two of the four subzones have also allocated funds to administration to employ a full-time professional subzone manager to oversee the day-to-day operations within the subzone.

    FUNDING ------------------------------------------------------- Appendix I:3.2

    The EZ/EC SSBG funds pass through the Texas Health and Human Services Commission to the Rio Grande Valley Empowerment Zone for its use. As of December 31, 1996, the EZ had obtained about $4.9 million of the EZ/EC SSBG funds for use in its projects.

    STRATEGIC PLAN ------------------------------------------------------- Appendix I:3.3

    The EZ's strategic plan focuses on 10 objectives, including (1) improving the quality of life to discourage outmigration from the area, (2) providing programs for literacy and living skills, (3) initiating regional business development, and (4) improving the availability of housing by providing new housing and increasing access to the existing housing. The EZ has 49 benchmarks. Specific projects include the following:

    -- establishing a small business incubator;

    -- developing a historical district for small businesses;

    -- implementing a flood control project; and

    -- establishing a community elder care/youth recreation center.

    CENTRAL SAVANNAH RIVER AREA ENTERPRISE COMMUNITY --------------------------------------------------------- Appendix I:4

    Figure I.4: Central Savannah River Area Enterprise Community

    (See figure in printed edition.)

    GOVERNANCE ------------------------------------------------------- Appendix I:4.1

    As of January 1997, the EC was in the process of reincorporating and negotiating revisions to the memorandum of agreement. At the time of our visit, the EC was governed by a board drawn from the 10 Census tracts comprising the EC. In addition, each of the 10 subzone areas had established local EC boards to oversee projects within the subzone. The Central Savannah River Area Regional Development Center was the lead entity for the EC.

    FUNDING ------------------------------------------------------- Appendix I:4.2

    The EZ/EC SSBG funds pass through the Georgia Department of Community Affairs to the Central Savannah River Area Enterprise Community for its use. As of December 31, 1996, the EC had obtained about $429,000 of the EZ/EC SSBG funds for use in its projects.

    STRATEGIC PLAN ------------------------------------------------------- Appendix I:4.3

    The EC's strategic plan emphasizes seven goals: (1) agriculture, business, and economic development; (2) human development, health, and public safety; (3) education; (4) housing; (5) arts, recreation, and cultural tourism; (6) public infrastructure; and (7) community organizing, coalitions, and partnerships. The EC has 12 benchmarks. Specific projects include the following:

    -- operating general education degree classes for the EC's residents;

    -- establishing family service centers providing such services as youth recreation and leadership classes and adult literacy classes; and

    -- training community outreach organizers to foster community involvement.

    CRISP/DOOLY ENTERPRISE COMMUNITY --------------------------------------------------------- Appendix I:5

    Figure I.5: Crisp/Dooly Enterprise Community

    (See figure in printed edition.)

    GOVERNANCE ------------------------------------------------------- Appendix I:5.1

    The Crisp/Dooly Partnership, Inc., is the lead entity and is responsible for implementing the enterprise community's strategic plan. The Crisp/Dooly Partnership reports to a 32-member board consisting of representatives of Crisp and Dooly counties, 16 from each county, and are drawn from such organizations as economic development councils, chambers of commerce, and boards of education as well as from law enforcement groups, churches, and low-income residents.

    FUNDING ------------------------------------------------------- Appendix I:5.2

    The EZ/EC SSBG funds pass through the Georgia Department of Community Affairs to the Crisp/Dooly Joint Development Authority, which is fiscally responsible for the EZ/EC SSBG funds. The Crisp/Dooly Joint Development Authority consists of a separate board of eight directors who are appointed by the Crisp and Dooly county governments and who, in turn, release the funds to the Crisp/Dooly Partnership, Inc., for the implementation of the strategic plan. As of December 31, 1996, the EC had obtained about $215,000 of its EZ/EC SSBG funds program for use in its projects.

    STRATEGIC PLAN ------------------------------------------------------- Appendix I:5.3

    The EC's strategic plan emphasizes five goals: (1) social and economic empowerment for developing innovative community services, (2) development of Crisp/Dooly counties' economic partnership to coordinate economic development initiatives, (3) human and community development through improved community relations, (4) improving education, and (5) improving the quality of life and of the environment. The EC has 37 benchmarks. Specific projects include the following:

    -- building a postsecondary vocational-technical center;

    -- establishing an adult literacy program; and

    -- developing a rural transportation system.

    CITY OF LOCK HAVEN ENTERPRISE COMMUNITY --------------------------------------------------------- Appendix I:6

    Figure I.6: City of Lock Haven Enterprise Community

    (See figure in printed edition.)

    GOVERNANCE ------------------------------------------------------- Appendix I:6.1

    The lead entity for the EC is the City of Lock Haven City Council; a full-time Federal Enterprise Coordinator was hired by the city to manage the day-to-day operations of the EC. A Federal Enterprise Committee oversees the EC; several subcommittees, such as the economic development subcommittee and health and human services subcommittee report to the EC Committee.

    FUNDING ------------------------------------------------------- Appendix I:6.2

    The EZ/EC SSBG funds pass through the Pennsylvania Department of Public Welfare to the City of Lock Haven Enterprise Community for its use. As of December 31, 1996, the EC had obtained about $456,000 of the EZ/EC SSBG funds for use in its projects.

    STRATEGIC PLAN ------------------------------------------------------- Appendix I:6.3

    The EC's strategic plan states that its main goal is to promote economic development through job creation and retention. The EC has 36 benchmarks. Specific projects include the following:

    -- establishing a micro-revolving loan fund to assist small and start-up businesses;

    -- establishing a partnership among the city, Clinton County, local banks and lending institutions, local housing nonprofit organizations, and housing developers to expand the supply of affordable housing for elderly and low-income residents; and

    -- assisting in the renovation of a job training facility and in funding job training workshops in such subjects as computer skills.

    NORTH DELTA MISSISSIPPI ENTERPRISE COMMUNITY --------------------------------------------------------- Appendix I:7

    Figure I.7: North Delta Mississippi Enterprise Community

    (See figure in printed edition.)

    GOVERNANCE ------------------------------------------------------- Appendix I:7.1

    When the EZ/EC program was announced in 1994, a group of 22 citizens from this very poor area of Mississippi came together to discuss applying for designation as an EZ or EC. With the assistance of an established local Planning and Development District, they applied for and were subsequently designated as an EC. In November 1995, this group was incorporated as the North Delta Mississippi Enterprise Community Development Corporation. A 22-member board, consisting of the citizens who had been involved in the preparation of the strategic plan, was installed and authorized to determine the major personnel, fiscal, and program policies and the overall program plans and priorities and to give final approval to all corporate initiatives.

    FUNDING ------------------------------------------------------- Appendix I:7.2

    The EZ/EC SSBG funds pass through the Mississippi Department of Human Services to the North Delta Enterprise Community for its use. As of December 31, 1996, the EC had obtained about $25,000 of the EZ/EC SSBG funds for use in its projects.

    STRATEGIC PLAN ------------------------------------------------------- Appendix I:7.3

    The EC's strategic plan focuses on four areas: (1) economic and community development, (2) empowerment through the ability of the EC to solve its own problems and create its own opportunities, (3) human services and physical development, and (4) natural resources and environmental concerns. The EC has 16 benchmarks. Specific projects include the following:

    -- developing parks,

    -- recommending state legislation for a tax-incentive program,

    -- providing small business training, and

    -- increasing the availability of safe and affordable housing.

    CITY OF WATSONVILLE ENTERPRISE COMMUNITY --------------------------------------------------------- Appendix I:8

    Figure I.8: City of Watsonville Enterprise Community

    (See figure in printed edition.)

    GOVERNANCE ------------------------------------------------------- Appendix I:8.1

    The City Council of Watsonville is the lead entity for the EC; the deputy city manager has the day-to-day responsibilities for the EC. An advisory steering committee represents the residents of the EC; however, the city council has decision-making responsibility.

    FUNDING ------------------------------------------------------- Appendix I:8.2

    The EZ/EC SSBG funds pass through the California Department of Social Services to the City of Watsonville Enterprise Community for its use. As of December 31, 1996, the EC had obtained about $250,000 of the EZ/EC SSBG funds for use in its projects.

    STRATEGIC PLAN ------------------------------------------------------- Appendix I:8.3

    The main emphasis of the EC's strategic plan is youth development. The EC has 15 benchmarks. Specific projects include the following:

    -- establishing youth job training, including teaching basic job-seeking strategies;

    -- expanding and renovating recreation facilities for at-risk youth in several impoverished parts of the city;

    -- building and operating a small business retail incubator in conjunction with the new transit center; and

    -- improving the downtown area by refurbishing retail businesses' facades.

    OBJECTIVES, SCOPE, AND METHODOLOGY ========================================================== Appendix II

    To estimate the cost of the rural EZ/EC program, we reviewed information on the resources available to the EZ/EC program from the U.S. Department of Agriculture (USDA), the Department of Health and Human Services (HHS), and 13 other federal agencies. We also obtained tax-incentive information from the Internal Revenue Service and spoke with officials in the Office of Tax Assessment.

    To review the status of the EZ/EC program's implementation and identify the difficulties that communities have encountered, we talked with officials and obtained information at all 3 rural EZs, 5 of the 30 rural ECs, six states, and the two principal agencies, USDA and HHS. We selected ECs that are located in the same state as the EZs and added ECs from three other states to provide geographic distribution. During our visits to these communities, we visited selected projects to discuss the EZ/EC program with the individuals most directly involved at the local level. We also reviewed the strategic plans, benchmarks, status reports, and funding documents for the eight EZ/ECs visited, as well as information maintained by USDA on the remaining 25 rural ECs. We also examined the progress reports available at USDA's headquarters.

    To evaluate USDA's oversight of the EZ/EC program, we reviewed the applicable regulations, discussed the roles of the USDA state coordinators with USDA headquarters officials, examined USDA's central files on progress reports, and requested reports from USDA's monitors. We also interviewed the USDA state coordinators in the six states we visited.

    We performed our work in accordance with generally accepted government auditing standards from June 1996 through February 1997.

    (See figure in printed edition.)Appendix III COMMENTS FROM THE DEPARTMENT OF AGRICULTURE ========================================================== Appendix II

    (See figure in printed edition.)

    (See figure in printed edition.)

    (See figure in printed edition.)

    The following are GAO's comments on the U.S. Department of Agriculture's letter dated March 10, 1997.
    

    ---

    Robert's Rules of Order (Revised) by General Henry M. Robert   Posted: April 10, 2002
    Click here for Robert's Rules of Order Revised by General Henry M. Robert 1915 Version, Public Domain

    ---

    A Quick Look at Kentucky's Open Record Statutes   Posted: April 8, 2002
    A Quick Look at the Open Record Statutes from The Reporters Committee for Freedom of the Press

    State statutes declare every public agency is subject to the act. The term "public agency" is broadly defined to include governmental agencies and private agencies which receive significant funding from the government:(1) "Public Agency" means:...
    (i) Any entity where the majority of its governing body is appointed by a public agency as defined in paragraph (a), (b), (c), (d), (e), (f), (g), (h), (j), or (k) of this subsection; by a member or employee of such a public agency; or by any combination thereof;

    ---

    "Public record" means all books, papers, maps, photographs, cards, tapes, discs, diskettes, recordings, software or other documentation regardless of physical form or characteristics, which are prepared, owned, used, in the possession of or retained by a public agency. "Public record" shall not include any records owned or maintained by or for a body referred to in subsection (1)(h) of this section that are not related to functions, activities, programs, or operations funded by state or local authority.

    ---

    
    
    III. MEETING CATEGORIES -- OPEN OR CLOSED.
    D. Federal programs.
    
    Closed only if required by federal law. See KRS 61.810(1)(k).
    
    

    ---

    III. STATE LAW ON ELECTRONIC RECORDS H. On-line dissemination

    Kentucky has recognized the relationship between the ORA and electronic storage and retrieval of public records, and has directed public agencies to make their computerized information available under the ORA:

    The General Assembly finds an essential relationship between the intent of this chapter and that of KRS 171.410 to 171.740, dealing with the management of public records, and of KRS 61.940 to 61.957, dealing with the coordination of strategic planning for computerized information systems in state government; and that to ensure the efficient administration of government and to provide accountability of government activities, public agencies are required to manage and maintain their records according to the requirements of these statutes.

    KRS 61.8715.

    ---

    I. STATUTE - BASIC APPLICATION. D. What constitutes a meeting subject to the law.

    A meeting is defined as "all gatherings of every kind, including video teleconferences, regardless of where the meeting is held, and whether regular or special and informational or casual gatherings held in anticipation of or in conjunction with a regular or special meeting."
    

    ---

    Researching the Exempt Organization   Posted: April 8, 2002
    Researching the Exempt Organization

    The primary source of information on tax exempt organizations is the IRS Form 990, the annual tax/information return. Although tax exempt organizations have been required to make their annual returns public for many years, obtaining copies from the organization or from the IRS was a time-consuming task. Many tax exempt organizations were simply unaware of the disclosure requirements. In 1996, Congress enacted the Taxpayer Bill of Rights 2, which expanded the disclosure requirements for tax exempt organizations and increased penalties. The IRS issued regulations implementing these expanded requirements which were effective June 8, 1999. The IRS promises stricter enforcement of these new requirements.
    

    ---

    A compendium of information on the state's open records and open meetings laws   Posted: April 8, 2002
    A compendium of information on the state's open records and open meetings laws published by The Reporters Committee for Freedom of the Press.

    " At its core, participatory democracy decries locked files and closed doors. Good citizens study their governors, challenge the decisions they make and petition or vote for change when change is needed. But no citizen can carry out these responsibilities when government is secret.

    Assurances of open government exist in the common law, in the first state laws after colonization, in territorial laws in the west and even in state constitutions. All states have passed laws requiring openness, often in direct response to the scandals spawned by government secrecy. The U.S. Congress strengthened the federal Freedom of Information Act after Watergate, and many states followed suit.

    Some public officials in state and local governments work hard to achieve and enforce open government laws. The movement toward state FOI compliance officers reflects a growing activism for access to information in the states.

    But such official disposition toward openness is exceptional. Hardly a day goes by when we don't hear that a state or local government is trying to restrict access to records that have traditionally been public -- usually because it is feared release of the records will violate someone's "privacy."

    It is in this climate of tension between broad democratic mandates for openness and official preference for secrecy that reporters and good citizens need to garner their resources to ensure the passage and success of open government laws.

    The Reporters Committee genuinely hopes that TAPPING OFFICIALS' SECRETS will help a vigorous press and citizenry to shape and achieve demands for openness, and that it will serve as a primer for those who battle in government offices and in the courts for access to records and meetings. When challenges to secrecy are successful, the news is better and so is the government."
    

    ---

    IRS page on Non-Profits   Posted: April 8, 2002
    Tax Information for Charitable Organizations

    Charitable, religious, educational, scientific, literary, etc. organizations that meet the requirements of § 501(c)(3) are exempt from federal income tax.
    

    ---

    The Grants & Nonprofit Information Center at the Tucson-Pima Public Library   Posted: April 8, 2002
    https://www.lib.ci.tucson.az.us/grants/NonprofitMgmtLinks.htm
    
    This page contains links useful for starting and running a nonprofit. It includes board development, evaluating programs, and marketing.
    
    
    

    ---

    Sample Bylaws on Conflict of Interest and Disclosure   Posted: April 8, 2002
    Sample Bylaws on Conflict of Interest and Disclosure

    https://www.nonprofits.org/npofaq/keywords/1e.html

    Nonprofit Financial Center Conflict of Interest Statement

    for Officers, Directors, Committee Members, Staff Members, Institute Faculty and certain Consultants

    No member of the NFC Board of Directors, or any of its Committees, shall derive any personal profit or gain, directly or indirectly, by reason of his or her participation with the Nonprofit Financial Center. Each individual shall disclose to the Nonprofit Financial Center any personal interest which he or she may have in any matter pending before the NFC and shall refrain from participation in any decision on such matter.

    Any member of the NFC Board, any Committee or Staff who is an officer, board member, a committee member or staff member of a borrower organization or a loan applicant agency shall identify his or her affiliation with such agency or agencies; further, in connection with any credit policy committee or board action specifically directed to that agency, he/she shall not participate in the decision affecting that agency and the decision must be made and/or ratified by the full board.

    Any member of the NFC Board, any Committee, Staff of Institute Faculty shall refrain from obtaining any list of NFC clients for personal or private solicitation purposes at any time during the term of their affiliation.

    At this time, I am a Board member, a committee member, or an employee of the following organizations: _________________________________ _________________________________ _________________________________ _________________________________ _________________________________ _________________________________

    Now this is to certify that I, except as described below, am not now nor at any time during the past year have been:

    1) A participant, directly or indirectly, in any arrangement, agreement, investment, or other activity with any vendor, supplier, or other party; doing business with the NFC which has resulted or could result in person benefit to me.

    2) A recipient, directly or indirectly, of any salary payments or loans or gifts of any kind or any free service or discounts or other fees from or on behalf of any person or organization engaged in any transaction with the NFC.

    Any exceptions to 1 or 2 above are stated below with a full description of the transactions and of the interest, whether direct or indirect, which I have (or have had during the past year) in the persons or organizations having transactions with the NFC. _________________________________ _________________________________ _________________________________ _________________________________ _________________________________ _________________________________ Date: ________________

    Signature: _______________________________

    Printed name: ________________________________

    Nonprofit Financial Center 111 West Washington, Suite 1221 Chicago, Illinois 60602 312-606-8250

    There's another sample conflict of interest policy toward the end of https://www.nonprofits.org/npofaq/misc/020120dag.html

    
    FAQs on Disclosure:

    https://www.nonprofits.org/npofaq/misc/020120dag.html
    
    

    ---

    Basic information for nonprofit boards of directors   Posted: April 8, 2002
    Basic Board Information: Guide picks

    Basic information for nonprofit boards of directors, including responsibilities, duties and job descriptions
    

    ---

    Nonprofit Organization and IRS Form 990 Nonprofit Software   Posted: April 8, 2002
    Nonprofit Organization and IRS Form 990 Nonprofit Software 990 Accountant.com - a comprehensive guide to organizing and operating a nonprofit organization. Here you'll find the steps to take to become a nonprofit organization and the annual reporting requirements of IRS form 990. We also publish the leading IRS form 990 nonprofit software program and the leading nonprofit IRS Application Packages - IRS forms 1023, 1024, and 1028. So if you're thinking of starting a nonprofit organization and you're not sure what to do you're at the right web site. If you're not sure what forms you need to file with the IRS the answer is in our Reference Chart.
    

    ---

    How to Form and Operate a Non-Profit Corporation   Posted: April 8, 2002
    How to Form and Operate a Non-Profit Corporation

    A nice table from the Foundation Center.
    

    ---

    Links to several commonly-used IRS forms and publications   Posted: April 8, 2002
    Included here are links to several commonly-used IRS forms and publications. Click here to go to nonprofitlaw.com

    IRS Forms

    Printed copies of IRS forms can be obtained by calling 1-800-TAX-FORM (1-800-829-3676).

    Applying for tax-exempt status

    Annual information returns

    Charitable contributions

    Unrelated business income
    

    ---

    Frequently Asked Questions: Tax Exempt Organizations   Posted: April 8, 2002
    www.irs.gov/prod/bus_info/eo/eo-faqs.html
    • How does an organization become tax-exempt?
    • How can an application for tax-exempt status be expedited?
    • How can I determine if a particular organization is tax-exempt?
    • How can I obtain copies of Form 990, Package 1023, or Package 1024?
    • How do I obtain a copy of the organization's exemption letter?
    • Can I get a list of donors to an organization?
    • What should I do if a § 501(c) organization will not let me see its Form 990 returns?
    • Do individual members of a group ruling have to file separate Form 990 returns?
    • What happens if the Form 990 is incomplete?
    • Can penalties for filing Form 990 late be abated?
    • What is the difference between not-for-profit and tax-exempt?
    • Can tax-exempt organizations endorse candidates for public office?
    • Can my organization engage in a certain activity?
    • Where do I send complaints about the activities/operations of tax-exempt organizations?
    • Why is it taking so long to process an exemption for application?
    • What is an advance ruling period and what are we required to do?
    • May a subordinate of a group ruling file its own returns?

    ---

    How does an organization become tax-exempt?

    To be exempt from federal income tax, an organization must be described in one of the sections of the Internal Revenue Code providing for exemption. See Types of Tax-Exempt Organizations or download Publication 557, Tax-Exempt Status for Your Organization for more information. Most organizations seeking recognition of exemption from federal income tax must use application forms specifically prescribed by the Service. Two forms currently prescribed by the Service are Package 1023, Application for Recognition of Exemption, (for charitable organizations) and Package 1024, Application for Recognition of Exemption, (for other tax-exempt organizations). A few types of organizations are not required to submit specific application forms. The application your organization is required to submit is specified in Publication 557.

    Return to List of FAQs

    ---

    How can an application for tax-exempt status be expedited?

    Requests for expedited treatment of an application must be made in writing and must contain a compelling reason why the case should be worked ahead of its normal date order. Generally, expedited treatment will be granted in the following circumstances:

    • A grant to the applicant is pending and the failure to secure the grant may have an adverse impact on the organization's ability to continue operations;
    • The purpose of the newly created organization is to provide disaster relief to victims of emergencies such as flood and hurricane;
    • There have been undue delays in issuing a letter caused by problems within the Service;
    • Any other situation where the IRS feels expedited service is warranted.
    Return to List of FAQs

    ---

    How can I determine if a particular organization is tax-exempt?

    Publication 78 provides a listing of organizations that have been recognized by the Service as eligible to receive tax deductible contributions. Tax-exempt organizations that are not eligible to receive tax deductible contributions are not included.

    For information concerning other organizations that have been recognized by the IRS as tax-exempt organizations, you may call IRS Customer Service.

    Return to List of FAQs

    ---

    How can I obtain copies of Form 990, Package 1023, or Package 1024?

    These forms are available in Forms and Publications. See Tax-Exempt Organizations Tax Kit for a list of forms and publications of interest to tax-exempt organizations. You may also request these forms by calling 1-800-TAX-FORM (1-800-829-3676).

    Return to List of FAQs

    ---

    How do I obtain a copy of the organization's exemption letter?

    As a result of the recent enactment of regulations pursuant to the Taxpayer Bill of Rights 2, a tax-exempt organization will be required to provide one or more copies of its three most recent information returns, its exemption letter, and its approved application with supporting documentation without charge (other than a reasonable fee for any reproduction and mailing costs) to persons requesting copies (with certain exceptions), unless it has made these forms widely available by publishing them on the Internet in accordance with the regulations. For more information, see our frequently asked questions, the final regulations published in Internal Revenue Bulletin 1999-17, or download Disclosure Requirements.

    You may also contact the local Disclosure office of the IRS, or send requests to IRS, Chief, FOIA Branch, c/o Ben Franklin Station, P.O. Box 795, Washington, DC 20044. A fee is charged for reproduction and mailing costs.

    Return to List of FAQs

    ---

    Can I get a list of donors to an organization?

    Information about donors is specifically excluded from the information available for public inspection, except for donors to private foundations. The annual information return (Form 990) and its attachments (except donor lists), and the approved application for recognition of exemption and supporting documents, and any letters issued to the organization can be inspected at the organization's place of business.

    Return to List of FAQs

    ---

    What should I do if a § 501(c) organization will not let me see its Form 990 returns?

    Write to the IRS Customer Service Provide the name and address of the organization that refuses to allow public inspection or provide copies of its return, and request that the return be made available for public inspection. The Tax Exempt/Governmental Entities Division of the IRS will contact the organization and arrange a time during which the return may be inspected. If the organization fails to provide the return at the agreed upon time, statutory penalties will start to be assessed. For more information, see our frequently asked questions, the final regulations published in Internal Revenue Bulletin 1999-17, or download Disclosure Requirements.

    Return to List of FAQs

    ---

    Do individual members of a group ruling have to file separate Form 990 returns?

    If the parent organization files a group return on behalf of the subordinate members of the group, the subordinate member organizations included in the group return are not required to file a separate Form 990. However, if the individual member of a group ruling is not included in a group return filed by the parent organization, it is required to file a separate Form 990 unless it otherwise meets an exception to the filing requirements. See Filing Requirements for more information.

    Return to List of FAQs

    ---

    What happens if the Form 990 is incomplete?

    Under § 6652(c) of the Code, a tax-exempt organization required to file a Form 990 that files an incomplete return may be subject to a $20 a day penalty up to a maximum of $10,000 (or 5% of the organization's gross receipts, whichever is less) for returns for taxable years ending on or after July 30, 1996. The penalty increases to $100 per day up to a maximum of $50,000 for organization whose gross receipts exceed $1,000,000. No penalty will be imposed if the incomplete return is due to reasonable cause.

    Return to List of FAQs

    ---

    Can penalties for filing Form 990 late be abated?

    Failure to timely file the information return, absent reasonable cause, can give rise to a penalty under § 6652 of the Code. Generally, the reasonable cause exception to the penalty will be determined on a case-by-case basis taking into account all relevant facts and circumstances. The regulations provide that an affirmative showing of reasonable cause must be made in the form of a written statement, containing a declaration by the appropriate person that the statement is made under the penalties of perjury, setting forth all the facts alleged as reasonable cause. The request for abatement may be made by using Form 4571, which may be obtained by calling 1-800-TAX-FORM (1-800-829-3676), and should include supporting documentation.

    When requesting reasonable cause, your letter should address the following items:

    • The reason the penalty was charged. The daily delinquency penalty may be charged for either a late filed return, an incomplete return or both.

    • Show how the event prevented the organization prevented the organization from requesting an extension of time to file their return.

    • Explain how the situation prevented the organization from complying with the law.

    • Show the organization was not neglectful or careless, but exercised ordinary business care and prudence.

    • Explain what steps have been taken to prevent the same situation from occurring in the future.
    Return to List of FAQs

    ---

    What is the difference between not-for-profit and tax-exempt?

    Non-profit and not-for-profit are state law concepts. Most states have laws whereby an entity can be incorporated as a non-profit or not-for-profit organization. However, the mere fact that an entity is organized as a non-profit or not-for-profit organization does not indicate that it is exempt from federal income tax. To qualify as a tax-exempt organization, an entity must meet requirements set forth in the Internal Revenue Code. See Types of Tax-Exempt Organizations or Publication 557 for more information.

    Return to List of FAQs

    ---

    Can tax-exempt organizations endorse candidates for public office?

    Whether a tax-exempt organization may endorse candidates for public office without jeopardizing its tax-exempt status depends upon the type of tax-exempt organization it is. For example, § 501(c)(3) organizations may not engage in political activity, including endorsing candidates, but other organizations, such as § 501(c)(4) organizations, may engage in political activity so long as that is not their primary activity. However, § 501(c) organizations that make expenditures for political activity may be subject to tax under § 527(f). For more information, download Election Year Issues.

    Return to List of FAQs

    ---

    Can my organization engage in a certain activity?

    The activities that a tax-exempt organization may engage in without jeopardizing its tax-exempt status vary depending upon the nature of its exemption. See Types of Tax-Exempt Organizations or Publication 557 for more information. You may also request a ruling regarding the effect of a proposed transaction on your organization's tax-exempt status.

    See Rev. Proc. 2000-4, 2000-1 I.R.B 115, for the procedures to request a ruling and Rev. Proc. 2000-8, 2000-1 I.R.B. 230, which explains the user fee charges for such rulings. Both of these revenue procedures are available in 2000-1 Internal Revenue Bulletin.

    Return to List of FAQs

    ---

    Where do I send complaints about the activities/operations of tax-exempt organizations?

    Complaints about the activities or operations of tax-exempt organizations that are inconsistent with exemption should be sent to the TE/GE Customer Service. The complaint should contain all relevant facts concerning the alleged violation of tax law.

    The IRS cannot advise you of any action it has taken or may take in response to a complaint because the confidentiality and disclosure provisions of the Internal Revenue Code, which were enacted by Congress to protect the privacy of all taxpayers, preclude it from discussing matters relating to any activity it might undertake regarding the tax-exempt status of an entity, other than with principal officers or authorized representatives of that entity. The IRS does maintain an active examination program to insure that tax-exempt organizations, as well as taxpayers, meet the requirements imposed on them by the Internal Revenue Code.

    Return to List of FAQs

    ---

    Why is it taking so long to process an exemption for application?

    There are many reasons why it may take some time to process a particular application. These range from simple administrative errors on the application to issues concerning the qualification of the organization for exemption. See the Top Ten Reasons for Delay in Processing Applications.

    Return to List of FAQs

    ---

    What is an advance ruling period and what are we required to do?

    An organization normally may be granted an advance ruling period of five taxable years, allowing it to operate as a public charity rather than as a private foundation. Ninety days after the end of the advanced ruling period, the organization may submit Form 8734 (Support Schedule for Advance Ruling Period). Failure to submit Form 8734 results in the organization automatically being reclassified as a private foundation required to file Form 990PF.

    Return to List of FAQs

    ---

    May a subordinate of a group ruling file its own returns?

    Yes, a subordinate of a group may file its own return. It must make sure to use its own EIN, not the parent's EIN or the group number. The parent's EIN is used to file the parent's individual return. The group number is used to file a group return covering those subordinates that elect to use a group filing. From 990-T can not be filed on a group return.

    
    

    ---

    Internet Nonprofit Center   Posted: April 8, 2002
    Internet Nonprofit Center

    
    Information for and about nonprofits: a program of The Evergreen State Society.

    
    The Nonprofit FAQ.
    
    Click here for Starting a Non-Profit FAQ references.

    
    
    Click here for the Charter Documents section of the FAQ
    
    
    

    ---

    How do I establish a nonprofit organization?   Posted: April 8, 2002
    The Foundation Center

    
    Forming a new nonprofit is a process that involves two distinct steps. Generally, you will need to establish your organization by filing articles of incorporation with the appropriate agency in your state (usually the state secretary of state). You will also need to secure federal income tax exemption by filing the appropriate forms with the Internal Revenue Service. Your local bar association may be able to direct you to "pro bono" or reduced-cost legal services as well. Please be aware that it usually takes 4 to 6 months to go through the process.

    In order to procure and file the appropriate forms required to apply for nonprofit incorporation, you may want to contact your state charity registration office. See State Agencies that Monitor Charities for those that have Web links. Be aware that procedures vary from state to state; you should consult with an attorney or an appropriate agency whose staff has experience in this area. For your Federal tax-exempt status application, please refer to The IRS: What You Need to Know if Your Organization Plans to Apply for Tax Exemption. Publication 557, Tax Exempt Status for Your Organization, is available for download in PDF format from the IRS site.

    There are several Internet resources that include information on how to start a nonprofit organization. These include:

    • The Internal Revenue Service's "Tax Information for Charitable Organizations".

    • The Internet Nonprofit Center's FAQ for start-ups.

    • About.com's Starting a Nonprofit Organization: One-Stop Answer Page.

    • The Alliance for Nonprofit Management.

    • Board Source's (formerly the National Center for Nonprofit Boards) FAQ, "How do we become a nonprofit organization?"

    Among the books on establishing nonprofits available at Center libraries and some Cooperating Collections are:

    • Blazek, Jody. Tax Planning and Compliance for Tax-Exampt Organizations: Forms, Checklists, Procedures. 3rd ed. New York, NY: John Wiley & Sons, 1999.

    • Bromberger, Allen R., Richard S. Hobish and Lori Yarvis, eds. Advising Nonprofits (4th ed.) New York, NYT: Council of New York Law Associates, 1995.

    • Conners, Tracy Daniel, ed. The Nonprofit Handbook: Management. 3rd ed. New York, NY: John Wiley & Sons, 2001.

    • Hopkins, Bruce R. Starting and Managing a Nonprofit Organization: A Legal Guide. 3rd ed. New York: John Wiley & Sons, 2001.

    • Hummel, Joan M. Starting and Running a Nonprofit Organization. 2nd ed. Minneapolis: University of Minnesota Press, 1996.

    • Kirschten, Barbara L. Nonprofit Corporation Forms Handbook 2000 Edition. Eagan, MN: West Group, 2000.

    • Mancuso, Anthony. How to Form a Nonprofit Corporation in all 50 States. 4th ed. Berkeley, CA: Nolo Pr., 1997.

    • Nicholas, Ted. The Complete Guide to Nonprofit Corporations. Chicago, IL: Enterprise-Dearborn Publishing Group, 1993.

    • Olenick, Arnold J. and Philip R. Olenick. A Nonprofit Organization Operating Manual: Planning for Survival and Growth. New York: The Foundation Center, 1991.

    • Zeitlin, Kim Arthur and Susan E. Dorn. The Nonprofit Board's Guide to Bylaws: Creating a Framework for Effective Governance. Washington, D.C.: National Center for Nonprofit Boards, 1996.

    For more books and articles on starting a nonprofit organization, try searching our Literature of the Nonprofit Sector Online (LNPS), the Center's bibliographic database. You could start searching on the subject "Nonprofit organizations--establishment and termination".

    Many of the books and articles found through LNPS can be located in Center Libraries. It is best to call ahead to verify a specific library's holdings.

    If the nonprofit you are establishing is intended to give money away, see the FAQ entitled "Where can I find information on starting a foundation?"
    

    ---

    Toolkit for Boards   Posted: April 8, 2002
    Free Complete Toolkit for Boards

    Materials in this topic apply to both nonprofit and for-profit Boards.

    Many of the following materials in this Library topic are excerpted from the guidebooks:

    * Nuts-and-Bolts Guide to Developing and Operating Your Nonprofit Board of Directors * Nuts-and-Bolts Guide to Leadership and Supervision for Nonprofit Staff * Nuts-and-Bolts Guide to Leadership and Supervision in Business

    Table of Contents of This Library Topic (categories below, are listed in the typical order of use) Board Roles and Responsibilities Overview of Board Roles and Responsibilities - - - Board Roles and Responsibilities - - - Sample Job Descriptions - - - Board and Staff Roles - - - Advisory Groups Legal and Insurance Considerations for Board Members
    

    ---

    Information on Renewal Communities*   Posted: March 28, 2002
    

    HUD received more than 100 applications for the program from both urban and rural areas around the country. The RC and Round III Empowerment Zone initiatives represent a new approach to advancing economic prosperity in the Nation's poorest communities. Communities that receive RC or EZ designation will be able to use a revitalizing business tax incentive package valued at $22 billion nationwide. HUD will designate a total of 40 rural and urban RCs. The designation period will be from January 1, 2002 to December 31, 2009.

    SUMMARY OF PROVISIONS CONTAINED IN H.R. 5662 THE "COMMUNITY RENEWAL TAX RELIEF ACT OF 2000" Prepared by the Staff of the Joint Committee on Taxation TITLE I. COMMUNITY RENEWAL PROVISIONS A. Renewal Communities Provisions The bill authorizes the Secretary of HUD to designate up to 40 "renewal communities" from areas nominated by States and local governments. At least 12 of the designated renewal communities must be in rural areas. In general, nominated areas are ranked based on a formula that takes into account the area's poverty rate, median income, and unemployment rate. A nominated area that is designated as a renewal community is eligible for the following tax incentives: (1) a zero-percent rate for capital gain from the sale of qualifying assets; (2) a 15-percent wage credit to employers for the first $10,000 of qualified wages; (3) a "commercial revitalization deduction" that allows taxpayers (to the extent allocated by the appropriate State agency for the period after December 31, 2001) to deduct either (a) 50 percent of qualifying expenditures for the taxable year in which a qualified building is placed in service, or (b) all of the qualifying expenditures ratably over a 10-year period beginning with the month in which such building is placed in service; (4) an additional $35,000 of section 179 expensing for qualified property; and (5) an expansion of the WOTC with respect to individuals who live in a renewal community. The 40 renewal communities must be designated by January 1, 2002, and the resulting tax benefits will be available for the period beginning on January 1, 2002, and ending December 31, 2009.

    
    
    
    
    

    --This is not an official "Breathitt/Owsley/Wolfe/Lee Renewal Community Committee of Responsible Authority" website. There is no official "Breathitt/Owsley/Wolfe/Lee Renewal Community Committee of Responsible Authority" website. --

    
    

    ---

    Tax Credit Information, General Information about Renewal Communities   Posted: March 28, 2002
    

    
    

    TITLE Renewal community (rc) competition information and resources; This is the big HUD page with most of the information you'll need on it.	LINK https://www.hud.gov/offices/cpd/ezec/news/rcinfo.cfm SEARCH HUD: https://www.hud.gov/assist/search.cfm
    Renewal Community Tax Incentives: A Short Look	https://www.mkedcd.org/projects/RC/RenewalCommunitiesTI.html
    PowerPoint slides	https://www.hud.gov/offices/cpd/ezec/news/RCs.ppt
    EZ/EC (Not RCs explicitly, but related programs) News and Announcements	https://www.ezec.gov/News/
    Tax Incentive Guide for Businesses in the Renewal Communities, Empowerment Zones and Enterprise Communities	https://www.hud.gov/utilities/intercept.cfm?/offices/cpd/ezec/news/taxincentives051701.pdf
    Frequently-asked Questions	https://www.hud.gov/utilities/intercept.cfm?/offices/cpd/ezec/news/round3/pdf/rc.pdf
    Renewal Community Tax Incentives	https://www.house.gov/jct/x-112-00.pdf
    SUMMARY OF PROVISIONS CONTAINED IN H.R. 5662 THE "COMMUNITY RENEWAL TAX RELIEF ACT OF 2000"	https://www.taxplanet.com/legislation/jct5662/jct5662.html
    Louisiana Renewal Community Information - Site information on the Renewal Communities of North, Central, Ouachita and New Orleans	https://www.renewallouisiana.com/
    Burlington Vermont Renewal Community Fact Sheet	https://www.cedoburlington.org/business/renewal_community/rcfactsheet.htm
    The Turtle Mountain Band of Chippewa is a renewal community and a federally recognized tribe located in North Dakota. The EPA awarded a National Brownfields Pilot Grant to the Tribe in 1998. They have a Fire Safety Program and an Electronics firm.	https://www.kstrom.net/isk/maps/dakotas/nd.html https://www.engg.ksu.edu/HSRC/Tosc/turtle.html https://www.usfa.fema.gov/safety/partner.htm"> https://www.usfa.fema.gov/safety/partner.htm https://www.chiptronics.com/aboutus.htm"> https://www.chiptronics.com/aboutus.htm
    Renewal Community: Brooke-Hancock-Jefferson Metropolitan Planning Commission 124 North 4th Street Steubenville OH 43952	https://www.bhjmpc.org/renewalcommunity.htm

    List of Renewal Communities Atlanta, GA, Black Belt Counties, AL, Buffalo and Niagara Falls, NY, Burlington, VT, Camden, NJ, Charleston, SC, Chattanooga, TN, Chicago, IL , Central Louisiana , Corpus Christi, TX, Detroit and Flint, MI, Eastern Kentucky, El Paso, TX, Greene-Sumter County, AL, Hamilton, OH, Jamestown, NY, Lawrence, MA, Los Angeles, CA, Lowell, MA, Memphis, TN, Milwakee, WI, Mobile, AL, New Orleans, LA, Newark, NJ, Northern Louisiana , Orange Cove, CA, Ouachita Parish, LA, Parlier,CA, Philadelphia, PA, Rochester, NY, San Diego, CA, San Francisco, CA, Schenectady, NY, Tacoma, WA, Turtle Mountain Band of Chippewa, ND, West Central Mississippi, Yakima, WA, Youngstown, OH

    https://www.hud.gov/news/releasedocs/rcinitiative.cfm

    The New Markets Tax Credit Program On December 21, 2000, the Community Renewal Tax Relief Act of 2000 was signed into law. The law provides for $15 billion in tax incentives under the New Markets Tax Credit Program to help spur economic growth in new markets in urban and rural communities across the country. By making an equity investment in an eligible 'community development entity' (CDE), individual and corporate investors can receive a New Markets Tax Credit worth more than 30 percent of the amount invested over the life of the credit, in present value terms. The CDE Application is available on the Fund's website at www.cdfifund.gov. The Tax Credit Allocation. Application will be available in early 2002.

    https://www.cdfifund.gov/overview/

    ---

    Links to supporting agencies and institiutions   Posted: March 28, 2002
    

    Links to supporting agencies and institiutions

    Kentucky Enterprise Zone Program Department of Financial Incentives Ky Cabinet for Economic Development Phyllis Bruning, Director	Email Phyllis Bruning
    UK Rural Studies UK Rural Studies Program conduct research into the economic opportunities and problems of rural areas.	https://www.rural.org/
    Local Government Guide URL Listings The Local Government Guide to the Internet: Online Resources for Communities is an Internet guidebook developed for everyone who makes decisions that impact their community's future. In the course of writing the Local Government Guide to the Internet, we compiled links to useful sites for local government leaders.	https://www.rural.org/lgg/lggurls.html
    A gateway to statistics from over 100 U.S. Federal agencies The Mapstats link here is really good	https://www.fedstats.gov/

    ---

    HUD Announcements and Original Statutes Creating RC's   Posted: March 28, 2002
    

    ---

    HUD Announcements and Original Statutes Creating RC's

    US CODE COLLECTION Notes on Sec. 1400E. Pub. L. 106-554, Sec. 1(a)(7) (title I, Sec. 101(c)), Dec. 21, 2000, 114 Stat. 2763, 2763A-599, provided that: ''Not later than January 31 of 2004, 2007, and 2010, the Comptroller General of the United States shall, pursuant to an audit of the renewal community program... report to Congress on such program and its effect on poverty, unemployment, and economic growth within the designated renewal communities, empowerment zones, and enterprise communities.' ADVISORY COUNCIL ON COMMUNITY RENEWAL 'There is established an advisory council to be known as the 'Advisory Council on Community Renewal' (in this part referred to as the 'Advisory Council'). ''SEC. 153. DUTIES OF ADVISORY COUNCIL.	https://www4.law.cornell.edu/uscode/26/1400E.notes.html
    HUD Notice Inviting Applications: Designation of Forty Renewal Communities FOR FURTHER INFORMATION: For technical questions, contact John Haines, Renewal Community Initiative, Office of Community Planning and Development, Department of Housing and Urban Development, 451 Seventh Street, SW, Room 7130, Washington, DC 20410, (202) 708-6339. Hearing- or speech-impaired individuals may call (800) 877-8339 (the Federal Information Relay Service-TTY). HUD prefers to receive technical questions by email to john_haines@hud.gov or by facsimile (FAX) to (202) 401-7615 or (202) 708-3363, since email or FAX enables the questions and answers to be communicated as rapidly as possible in writing.	https://www.epa.gov/brownfields/html-doc/fr080701.htm
    H.R.815 Title: To amend the Internal Revenue Code of 1986 to provide for the designation of renewal communities, to provide tax incentives relating to such communities, and for other purposes. Sponsor: Rep Watts, J. C., Jr.(introduced 2/24/1999) Related Bills: S.463 Latest Major Action: 3/18/1999 Referred to House subcommittee	https://thomas.loc.gov/cgi-bin/bdquery/z?d106:H.R.815:
    S.463 Title: To amend the Internal Revenue Code of 1986 to provide for the designation of renewal communities, to provide tax incentives relating to such communities, and for other purposes. Sponsor: Sen Abraham, Spencer(introduced 2/24/1999) Related Bills: H.R.815 Latest Major Action: 2/24/1999 Referred to House subcommittee	https://thomas.loc.gov/cgi-bin/bdquerytr/z?d106:SN00463:

    President Clinton's New Markets Initiative: Revitalizing America?s Underserved Communities December 14, 2000 Today, President Clinton is pleased to announce the passage of the historic new bipartisan New Markets and Community Renewal initiative. INCREASE IN THE PRIVATE ACTIVITY BOND CAP: The legislation increases the state private activity bond cap from $50 per resident to $75 per resident, phased in from 2001 to 2002. Private activity bonds allow states and municipalities to encourage economic growth in communities through the issuing of lower cost tax exempt bonds.

    https://clinton4.nara.gov/WH/new/html/Mon_Dec_18_154959_2000.html

    HUD ANNOUNCES EASTERN KENTUCKY COUNTIES SELECTED AS A RENEWAL COMMUNITY - ELIGIBLE FOR $17 BILLION IN TAX INCENTIVES HUD No. 02-013EKY Contact: John Milchick, Jr. (502)582-5816 For Release Tuesday January 22, 2002 LOUISVILLE, KY - The Department of Housing and Urban Development today announced that four counties in eastern Kentucky will be designated a "Renewal Community," eligible to share in an estimated $17 billion in tax incentives to stimulate job growth, promote economic development and create affordable housing. The 2000 Community Renewal Tax Relief Act established the Renewal Community Initiative that will encourage public-private collaboration to generate economic development in 40 distressed communities around the nation.

    https://www.hud.gov/news/release.cfm?content=pr02-013eky.cfm

    ---

    Critiques and Analysis of the Renewal Community Program   Posted: March 28, 2002
    

    Critiques and Analysis of the Renewal Community Program

    Testimony to the House Committee on Small Business 105th Congress 105th Congress on HR3865: The American Community Renewal Act Avis C. Vidal co-principal investigator of the evaluation of the Empowerment Zone and Enterprise Community program. Principal Research Associate The Urban Institute Washington, D.C. May 19, 1998 ...Second, the bill makes no provision for managing Renewal Communities-and good, entrepreneurial management costs money. This would not be a problem for Renewal Communities that are also Empowerment Zones, because they have Title XX funds (or local matching funds) to support the management entities they already have in place. It would be a problem for newly-designated zones, and for Renewal Communities that are also Enterprise Communities, since many will have no federal funding to support their zone management entities after the current fiscal year. What, then, accounts for the limited number of successful zones pointed to by Erickson and Friedman and others? The weight of the available evidence indicates that "successful" zones have two characteristics: Successful zones are good places to do business. Although the zones designated under state programs include residential areas that are experiencing some level of distress (most commonly measured in terms of high unemployment, high poverty rates, and low median income), they also include areas with genuine development potential, including a labor pool with good basic skills. Successful zones are actively managed by individuals with entrepreneurial skills-people who (a) reach out to business owners in the zone to keep them informed about the benefits available to them and provide them with tax forms and specific information about exactly how to take advantage of the benefits; (b) market the zone and its advantages to firms outside the zone that seek new locations; and (c) represent zone businesses in seeking improvements, such as new infrastructure, to the zone. https://www.urban.org/testimon/vidal5-19-98.html

    Focus on Partnerships. The RC Initiative focuses on creating meaningful and pro- ductive partnerships, which HUD will fully support through technical assistance and capacity-building activities. Technical assistance available to RCs will include easy access to available Federal resources and programs, a network for reaching out to the business community, and help in implementing courses of action. Building Lasting Alliances. The RC Initia- tive looks at ways to gain support and commitment from State and local governments to compose and refine a course of action that substantively addresses regulatory barriers, tax relief, and improvement of local services in the nominated areas. EZ Designation Increases Business EZs prove that even seemingly insurmountable obstacles faced by a distressed com- munity can be overcome through public and private partnerships. The successes of EZs can be tangibly measured in $4 billion in new private-sector investments in community development, in improved bond ratings, and in increased numbers of decent and affordable housing structures. Seven New Zones. Urban communities will have the opportunity to compete for seven additional designations available in Round III. Currently, there are 23 designated urban EZs representing an elite group of communities renowned and nationally recognized for their successes in urban revitalization. More Tax Credits. One of the major bene- fits offered to Round III EZ designees is a generous multimillion-dollar tax package that will include the EZ wage credit and the Work Opportunity Tax Credit. Federal Bonus Points. Other benefits in- clude special preferences and consideration in obtaining funding through other Federal competitions, with many offering bonus points to EZs. Technical Assistance. As a designated EZ, awardees receive funding and program information through HUD's Office of Empowerment Zones and Enterprise Com- munities. Round III EZ designees will have a network of experienced and knowledge- able Round I and Round II EZ communities to draw from for guidance and experience. https://www.comcon.org/

    C. Cooperation Among the Nominating Governments and Community Organizations Every application for RC designation must contain a course of action describing the commitment to cooperation in the nominated area by the nominating governments and community organizations that meets the requirements of this section II.C. listed immediately below. C. Cooperation Among the Nominating Governments and Community Organizations Every application for RC designation must contain a course of action describing the commitment to cooperation in the nominated area by the nominating governments and community organizations that meets the requirements of this section II.C. listed immediately below. 1. Commitment to a course of action. A course of action is a written document, signed by the nominated area's State and local governments, or in the case of a nominated area located within an Indian reservation, the reservation governing body, and community-based organizations which commits each signatory to undertake and achieve measurable goals and actions within the nominated area upon its designation as a Renewal Community. 2. Community-based organizations. For purposes of the course of action, ``community-based organizations'' includes for-profit and non- profit private entities, businesses and business organizations, neighborhood organizations, and community groups. Community-based organizations are not required to be located in the nominated area as long as they commit to achieving the goals of the course of action in the Renewal Community. 3. Timetable. The course of action must include a timetable that identifies the significant steps and target dates for implementing the goals and actions. 4. Performance measures. The course of action must include a description of how the performance of the course of action will be measured and evaluated. 5. Required goals and actions. The course of action must include at least four of the following: a. A reduction of tax rates or fees applying within the Renewal Community; [[Page 41435]] b. An increase in the level of efficiency of local services within the Renewal Community, such as services for residents funded through the Federal Temporary Assistance for Needy Families program and related Federal programs including, for example, job support services, child care and after school care for children of working residents, employment training, transportation services and other services that help residents become economically self-sufficient; c. Crime reduction strategies, such as crime prevention, including the provision of crime prevention services by nongovernmental entities; d. Actions to reduce, remove, simplify, or streamline governmental requirements applying within the Renewal Community, such as: i. Density bonus. Permission to develop or redevelop real property at a higher density level than otherwise permitted under the zoning ordinance, e.g., increased height or increased number of residential or business units; ii. Incentive zoning. Providing a density bonus or other real property-related incentive for the development, redevelopment, or preservation of a parcel in the designated area; iii. Comprehensive or one-stop permit. Streamlining construction or other development permitting processes, rather than requiring multiple applications for multiple permits, e.g., for demolition, site preparation, and construction, the developer or redeveloper submits asingle application that is circulated for the necessary reviews by the various planning, engineering, and other departments in the county or municipality; iv. Variance and exception policies. Counties or municipalities may pass ordinances that permit variances to or exceptions from certain zoning or other land use limitations. Examples include a reduced building set-back requirement or a reduced requirement for the provision of parking. The policy may be limited to a particular geographic area. v. Voluntary environmental compliance program. A shared or limited environmental liability program, with limited liability from certain legal or administrative action in exchange for undertaking an approved program of environmental investigation, hazard control, and on-going risk reduction activities. Typically, the liability limitation is for future environmental cleanup (and not against lawsuit for damages). Risk of cleanup may be shared by the developer or property owner and the government; e. Involvement in economic development activities by private entities, organizations, neighborhood organizations, and community groups, particularly those in the Renewal Community, including a commitment from such private entities to provide jobs and job training for, and technical, financial, or other assistance to, employers, employees, and residents from the Renewal Community; f. The gift or sale at below fair market value of surplus real property held by State or local governments, such as land, homes, and commercial or industrial structures in the Renewal Community to neighborhood organizations, community development corporations, or private companies. 6. Recognition of past efforts. The course of action is not limited to future goals and actions. Past efforts within the previous eight years, either completed or on-going, of the nominating State or local governments in reducing the various burdens borne by employers and employees in the nominated area by undertaking any of the goals or actions listed in section II.C.5., above, of this notice may be used to meet the course of action requirement. If past efforts are used, the course of action must identify which of the required goals and actions listed in section II.C.5. they address; the timetable for their continued implementation, if on-going; the community-based organizations involved, if any; and an evaluation of their performance and the performance measures used. https://www.epa.gov/brownfields/html-doc/fr080701.htm

    Summary of Community Renewal and New Markets Act of 2000 (S. 3152) Having been unsuccessful in getting members of the Senate Finance Committee to refrain from insisting on a host of amendments to his Chairman's mark, Senator William V. Roth on September 28 decided his $38.7 billion ten-year legislative package will sidestep panel action. After three postponed markups since the week of September 18, Chairman Roth had hoped his fellow committee members would go along with his modified mark. At a September 27 executive session panel meeting, the Chairman presented members with his modified version which incorporated nearly half of the 73 proposed amendments. The tentative markup was postponed 24 hours as lawmakers considered their options. In the end, members were reluctant to give up their rights to offer amendments because--it is widely agreed--the Chairman's mark looked to be the committee's last tax cut vehicle of the 106th Congress. On September 28, having met with members before the rescheduled markup, Chairman Roth decided to cancel drafting action on the measure. On October 3, Sen. Roth introduced S. 3152 (text: CR S. 9704-9729) as a stand-alone bill that was placed directly on the Senate calendar. According to aides, the thinking is that the legislation will not be brought up for Senate floor consideration. Rather, S. 3152 is intended to establish the Senate's position with regard to anticipated end-of-the-year negotiations between the White House and GOP leaders on a tax relief package that includes community renewal provisions. The Community Renewal and New Markets Act of 2000 closely tracks a number of the provisions in the House-passed package (H.R. 4923) of tax incentives designed to spur renewal of economically distressed urban and rural communities. At the same time, however, the Chairman's mark contains a number of tax breaks what were not included in the House measure. Key provisions of Chairman Roth's proposal would: Provide for the designation of up to 30 renewal zones that would be eligible for a range of tax breaks, including zero capital gains tax rate for sales of qualifying assets. The new renewal communities would be designated by January 1, 2002, and the resulting tax credits would be available to all Empowerment Zones--the new ones as well as those already designated during Rounds I and II--between January 1, 2002, and December 31, 2009. Provide $85 million in grants to Round II Empowerment Zones for FY2001 ($5 million to each urban zone and $2 million to each rural zone). Provide $88 million ($250,000 each) in grants for FY2001 to the 88 Round I Enterprise Communities (excludes Round I communities which were subsequently upgraded to zone status under Round II). Create a new markets tax credit with allocation authority of $1 billion in 2002 and $1.5 billion from 2003 through 2006. Establish Individual Development Accounts which would provide financial institutions with a 90 percent tax credit for matching a maximum contribution of $300 per account; sunset Dec. 31, 2005. Increase the annual low-income housing tax credit fro $1.25 to $1.75 per capita, beginning in 2001. The credit would be modified so that small population states would be given a minimum of $2 million of the annual credit cap. Create a tax credit for renovating historic homes. Authorize the issuance of tax credit bonds for the National Railroad Passenger Corporation ("Amtrak"). Create a broadband internet access tax credit. Expand the expensing of environmental remediation expenditures to all qualifying sites ("brownfields"). Accelerate an increase in the private activity bond volume limits to $75 per resident of each state or $225 million, if greater, so that it would be fully effective in 2001, rather than phased in during 2003-2007. Concluding Observations The idea behind the RC/NM initiative has been described as a merger of President Clinton's "New Markets Initiative"--including a tax credit and other incentives designed to attract capital to low-income areas--with a House Republican proposal called the "American Community Renewal Act (H.R. 815), which would provide tax and regulatory relief to economically distressed areas and help poor families set up subsidized savings accounts. (12) Instead of a merger, however, the bipartisan, anti-poverty package has been characterized as a juxtaposition: "We allow two different forms to see what we can learn over the next several years about what works best in attracting investment and job growth," said Gene Sperling. (13) Indeed, if a renewal communities/new markets initiative is enacted, it may be possible in a few years to examine the results and draw conclusions about which incentives, programs, and approaches seem to work best. The phenomenon of moribund urban and rural areas, and the myriad economic and human problems associated with them, will present a public policy challenge for the foreseeable future. The need to learn what works best argues for systematic collection of data that will facilitate program evaluation. On the other hand, history has shown that drawing conclusions about these types of economic development programs will not be easy. By the late 1980s, about three dozen states had created a variety of enterprise zone programs, yet even today there is little information about what works and what does not. The simple fact is that it is difficult to judge the success of economic development efforts. As one report notes: Although the economic development literature often discusses the potential effects of enterprise zones, empirical research on, or analysis of zone programs is somewhat limited. The modest amount of empirical research is due to two basic constraints: (1) the lack of reliable quantitative data to evaluate zone performance, and (2) the difficulty of isolating the effects of zone designation and incentives from those of other economic development factors and initiatives. (14) Compounding the difficulty of determining what works in the RC/NM initiative, should it come to pass, is one immutable fact: each empowerment zone or renewal community will be unique. They will differ in varying ways, including geographic and demographic characteristics, the nature of local governance, and unemployment and poverty rates-to name just a few. https://cnie.org/NLE/CRSreports/Economics/econ-73.cfm#_1_13

    ---

    The Non-Profit Library: Web resources for the Construction & Operation of Non-Profits.   Posted: January 1, 2002
    Tools for the construction and operation of Non-Profit Organizations. There are links to IRS Publications and the associated tax forms, sample Articles of Incorporation and Bylaws, and to supporting agencies.
    
    Detailed information on Kentucky statutes is emphasised: Open-Records law, links to the Commonwealth's Secretary of State, and the University of Kentucky all offer on-line support.
    
    Click here: https://www.appal.org/non_profit/ for the Non-Profit pages.
    

    ---

    Renewal Community Page   Posted: January 1, 2002
    The RC and Round III Empowerment Zone initiatives represent a new approach to advancing economic prosperity in the Nation's poorest communities. Communities that receive RC or EZ designation will be able to use a revitalizing business tax incentive package valued at $22 billion nationwide. HUD has designated a total of 40 rural and urban RCs. The designated period will be from January 1, 2002 to December 31, 2009.
    
    Click here: https://www.appal.org/rc/ for a lot more information on HUD's RC initiatives.

    ---

    Assorted Photos From Around Letcher County   Posted: June 20, 2001
    

    Bad Branch Falls. Photo by Spring Ulmer (tweaked by WH)

    
    
    

    The Late Joe Begley in front of the H.B. Caudill Store & Museum

    
    
    

    Local Paper Covering Letcher County Initiative to Pass Local Bottle Bill

    
    
    
    

    Judge-Executive Being Sworn In to Office

    
    
    

    Author Wendell Berry & Carroll Smith in Frankfort to Support a Bottle Bill

    
    

    ---

    Welcome to the Appal.org Website   Posted: June 4, 2001
    This site is intended to be easy to use and easy to access. You can search for anything we've got with the "Search the Website" link in the Main Menu (Top right, 2nd line down). The Main Menu is available from any page on this site, except inside the forums.
    
    Information about services is available here. Over time, more information will be posted. It is pretty bare bones right now.
    
    You may send us information. We can accept text, HTML, and graphics. Please check out the "Submit Photos and Articles" link in the lower right hand corner. We will review what you send us and may post it here for everyone.
    
    Groups can request private meeting space in password-protected forums. It is some work on our part, and the county's staff needs some time & practice before they'll get quick at it, but if you are part of a group that would like to have a private meeting room on the web, please drop us a line here.
    
    If you have any suggestions, want help using the site, or have information you would like to see posted here, please contact us (use the link above).
    
    

    NB: This site is not affiliated with any agency, committee, Federal, State, or Local Government.
    

    ---

    PRESIDENT CLINTON & SPEAKER HASTERT ANNOUNCE BIPARTISAN AGREEMENTON NEW MARKETS AND RENEWAL COMMUNITIES   Posted: May 23, 2000
    THE WHITE HOUSE

    Office of the Press Secretary ________________________________________________________________________ For Immediate Release May 23, 2000 | PRESIDENT CLINTON & SPEAKER HASTERT ANNOUNCE BIPARTISAN AGREEMENT

    ON NEW MARKETS AND RENEWAL COMMUNITIES

    Today, President Clinton will be joined by Speaker Dennis Hastert in announcing a bipartisan agreement on a New Markets and Community Renewal legislative initiative. This announcement is the outcome of the commitment President Clinton and Speaker Hastert made in Chicago last Nov. to develop a bipartisan legislative initiative on New Markets and revitalizing impoverished communities this year. This initiative will help encourage private sector equity investment in underserved communities throughout the country to ensure that all Americans share in our nation's economic prosperity. The President's New Markets Initiative was originally proposed in President Clinton and Vice-President Gore's FY 2000 budget. President Clinton has highlighted the potential of the nation's New Markets in three separate trips across America to underserved inner city and rural communities like Newark, NJ, Hartford, CT, the Mississippi Delta, Appalachia, and rural Arkansas, and the Pine Ridge Indian Reservation in S. Dakota.

    THE KEY ELEMENTS OF THE AGREEMENT ARE:

    NEW MARKETS INITIATIVES: -- The New Markets Tax Credit. Under this agreement, this credit will spur $15 billion in equity investment and will be available to taxpayers who invest in certain privately-managed investment funds and institutions, which, in turn, use these funds to finance businesses in low- and moderate-income communities. The proposal would provide a 30-percent credit (in present-value terms) for investments in a wide range of investment vehicles. Eligible investment companies include community development banks and other CDFI's, venture funds, and financial institutions such as the new investment company programs.

    -- America's Private Investment Companies (APICs). Just as America's support for the Overseas Private Investment Corporation helps promote growth in emerging markets abroad, APIC will encourage private investment in this country's untapped markets. Leveraging $2 for every $1 in private investment, the agreement authorizes HUD to guarantee up to $1 billion in low cost loans to match $500 million in private investment for a total of $1.5 billion in investments in underserved communities.

    -- New Markets Venture Capital (NMVC) Firms. NMVC firms will provide incentives to increase the availability of venture capital in low and moderate-income communities for small businesses. Expert guidance will also be made available to small business entrepreneurs in inner city and rural areas. Ten to twenty NMVC firms are planned. The agreement authorizes the SBA to guarantee up to $150 million in loans that will match $100 million in private equity for a total of $250 million. SBA will also have the authority to make $30 million in operating assistance grants to match equivalent private commitments.

    EMPOWERMENT ZONES: -- Expanded To 40 EZs & Strengthened EZs. President Clinton and Vice President Gore proposed and signed Empowerment Zone legislation in 1993 establishing 9 EZs across the country -- today there are 31 across America. This agreement: -- Designates a third round of 9 new Empowerment Zones (for a total of 40). -- Expands the Empowerment Zone tax incentives to form strategic partnership with all existing EZs so that all can utilize the 20% EZ wage credit, additional business expensing, and other incentives. -- Commits $200 million in discretionary investment this year for existing EZs. -- Establishes zero-rate capital gains rollover for investments within the EZ. -- A 60% capital gains exclusion for investment in small businesses. -- D.C. tax incentives would also be extended to 2009.

    RENEWAL COMMUNITIES: -- The creation of 40 Renewal Communities (32 urban, 8 rural), designated by the U.S. Dept. of Housing and Urban Development with targeted, pro-growth tax benefits, regulatory relief,. The tax benefits of Renewal Communities would address key hurdles facing small businesses when they are just getting started -- raising capital and maintaining cash flow. Key incentives aimed at spurring investment in Renewal Communities include: -- Zero Capital Gains Rate on the sales of assets held for more than 5 years. -- Increased Expensing for Small Businesses (up to $35,000 more than in current law for equipment). -- 15% Employment Wage Credit (up to $10,000 ) for each worker. -- Commercial Revitalization deductions for taxpayers who rehabilitate or revitalize buildings in a Renewal Community.

    In addition, the New Market/Renewal Communities Agreement includes these 2 provisions:

    -- EXPANSION OF THE LOW INCOME HOUSING TAX CREDIT: To expand and improve the supply of available low-income housing, this agreement increases the Low-Income Housing Tax Credit by more than 40% to build an additional 180,000 units of affordable housing for working families over the next five years.

    -- ALLOWING FAITH-BASED ORGANIZATIONS TO QUALIFY FOR SUBSTANCE ABUSE FUNDING: The initiative allows faith-based substance abuse prevention and treatment programs to qualify for federal funds on the same basis as other non-profits consistent with the 1996 Welfare Reform Act and the constitutional line between church and state.
    

    ---

    RC's: Policy Initiatives Behind Laudable Goals in Community Renewal Act   Posted: March 12, 1997
    
    Radical Policy Initiatives Hidden Behind Laudable Goals in Community Renewal Act

    FOR IMMEDIATE RELEASE Wednesday, March 12, 1997

    WASHINGTON -- Responding to the reintroduction of the Community Renewal Act, the American Civil Liberties Union today cautioned that hidden behind the legislation's laudatory goals are a series of radical policy initiatives that, if adopted, would drain some of the nation's poorest public schools of their funding.

    The ACLU also said that the legislation would also force local and state governments to give tax dollars to churches, synagogues and other religious institutions to provide drug counseling and drug rehabilitation programs even if the programs are heavily religious in nature.

    "Rather than solving the serious funding problems in the nations poorest school districts, the Community Renewal Act would exacerbate them by siphoning off tax dollars from the public schools to subsidize private, religious schools," said Laura W. Murphy, Director of the ACLU's National Washington Office.

    Murphy added that the community renewal bill is, in many ways, the codification of the Christian Coalition's agenda that was announced with great fanfare here in January. That agenda called for the removal of "obstacles" that currently keep religious organizations from receiving government funds.

    "The obstacles that the sponsors of the Community Renewal Act would so easily brush aside are nothing less than Constitution," Murphy said. "We can understand why the Christian Coalition would be so eager to dismiss our laws and traditions to further its agenda, but we are dismayed that the legislations co-sponsors, all of them elected officials who swore to uphold the Constitution, are so willing to follow along."

    Senators Spencer Abraham, R-Michigan, and Joseph Lieberman, D-Connecticut, are the primary co-sponsors of the legislation in the Senate. In the House, the bill is being co-sponsored by Representatives J.C. Watts, R-Oklahoma; Floyd H. Flake, D-New York, and James Talent, R-Missouri.

    One major section of the legislation would require all renewal communities to set up a school voucher scheme, deceptively titled "scholarships" in the legislation.

    The ACLU has long criticized voucher schemes, saying that they would undermine public education and violate the Constitution's Establishment clause, which prohibits the use of taxpayer dollars to fund sectarian institutions.

    In fact, the ACLU said that many state constitutions -- including those of the home states of two of the bill's primary sponsors, Oklahoma and Missouri -- contain explicit prohibitions on the use of public funds for sectarian purposes.

    The American public is also wary of voucher schemes. Polling shows that the public is overwhelmingly opposed to using money spent on public education to help parents pay for private or religious schools.

    "Rather than renewing the inner cities," Murphy said, "the legislation introduced today would leave the vast majority of public school children with no hope and no opportunity."
    

    ---