Show I w Western Resources Economic development reorganization By ne C. The President's economic development reorganization which Is given a good chance of getting a Congressional one of the most major program consolidations In will consolidate IS billion in existing and proposed loan and loan guarantee authority which is now scattered in three-and would have been in four different agencies had the bank been proposed and passed-and put it in one large financing Stuart E. assistant to the President for domestic explained to the press at a March 1 news The Economic Development Administration in the Commerce Department will get this new consolidated In the three current grant programs for economic development within EDA will be consolidated within EDA under the proposed It will be a half billion dollar That Is all the second portion of the President's reorganization announced on March 1 it can be accomplished by amendment to the law for which expires on The law must be extended this Both the Senate and House Public Works Committees have give a high to the extension of this economic development The House Economic Development chaired by Robert A. has tentatively scheduled a start of hearings on this legislation on March It has been promised it will receive the Administration draft on the proposed economic development reorganization by April a Committee source told Western Resources Wrap-up on March The Senate Regional and Community Development Subcommittee under Quentin N. D-N. has tentative plans to start hearings on the legislation in a Committee source told on March The Administration's proposed legislation has already left the Office of Management and Budget and is now being reviewed in the Commerce Department prior to its submission to WHERE WEST AFFECTED Southern northern New Reservations in the West and Midwest which are listed in the category will be affected by this So will other depressed areas in the notably although neither the Appalachian Commission nor any of the regional commissions are directly Budget Director James T. explained at the March 1 press brief President has long stressed the importance of long-term private sector jobs and economic growth in solving the problems of our distressed areas in both urban and rural the President is proposing to streamline the federal programs providing business loan assistance to help create such Under this Richard special assistant to the President for will be one place for the private businessman to go and get at the federal level if he is involved in an economic development project one of the chronically depressed Spanish-speaking counties of southern Colorado or northern New The reorganization offers largely one-stop service for a businessman or corporation seeking credit from But it does NOT provide one-stop service for a That question was specifically asked by at the press and the answer was what it does mean is that the mayor could go to this consolidated program for loan economic development-related loan guarantees and present his application at that one point for those This is a sore point with the task force headed by Lester M. Salamon which worked on the economic development It proposed a much larger reorganization in the economic development-community development but it was rejected by the President on primarily because of three The recommendations of the task force headed by Salamon would have provided a lead role in these matters for the Department of Housing and Urban Development Many of the mayors from the West and South felt that HUD is oriented mainly toward the large urban cities of the Northeast which are in serious economic The National Association of Counties felt the same and both the mayors and NACO passed their views on to in key members were cool to making HUD into THE economic development top sources have told there was a real question whether such a proposal could have been passed by But the Association of Governors was more sympathetic to the Idea of a major consolidation of economic and community development programs In has been largely because the governors felt it would help streamline their own agencies dealing with these problems and because they thought they would have a greater over such Fragmented federal programs have fragmentation of development functions at the state and local further reducing the capacity to formulate Integrated development the Salamon study team It also found after an study that there was much confusion at the state and local levels over federal assistance available in the areas of economic and community cities and rural areas in particular are complaining that only cities with costly operations can sort out the maze and get adequate development stated in its study of the That is why some of the experts who worked on the reorganization are upset with the like to bitch about the but when we really tried to do something about we could not get their one source at who did not want to be told INITIAL PROPOSAL President Carter in his urban policy message to Congress on March proposed the creation of a Development which would encourage businesses to locate or expand in economically distressed urban and rural The Bank would be authorized to guarantee investments totaling billion through He said the bank would be authorized to make grants for land site rehabilitation and loan guarantees on up to 75 percent of the capital costs of a provide a secondary loan market for private loans to finance capital expenditures in depressed areas-a proposal which Carter claimed would be beneficial to small and other aid to economically distressed The President sought million in economic development grant funds in his 1980 budget for the proposed new With the bank proposal in the Salamon task force in proposed the creation of a Department of Development Assistance which would have included the all of and the to of the following programs other agencies and EDA and the Regional Commissions from the Department of the community and economic development programs of the Farmers Home Administration from the Department of Agriculture two loan programs for economic development from the Small Business Administration and the community economic development program from the Community Services In the would have been a super just as the initial Department of Natural Resources proposal would have provided for a super Interior To some the two proposals on reorganization were in competition with each as both proposed transfers of large programs from both Commerce and With the possible loss of all EDA programs and the regional commissions to a and the National Oceanic and Atmospheric Administration to Commerce would not have been a viable Agriculture interests strongly protested a further weakening of So President Carter opted merely to consolidate economic development lending authority in EDA and to consolidate its three economic development grant He backed away completely from the development bank that he proposed last he proposed on March 1 that the million in grant money which he sought in the 1980 budget for the bank be with half going to the HUD Urban Development Action Grant program to help ailing and million to EDA for its consolidated economic development grant The smaller economic development reorganization does provide for the transfer of the loan and loan guarantee programs for state and local development companies for economic development from and the business and industry loan program from the Farmers Home Administration of USDA to EDA in the Commerce HUD will continue to play a major role in economic under the Carter reorganization as will the independent Appalachian the Regional Commission in and the Community Services So even after the reorganization goes into as a Congressional okay is there will still be departments with major economic development programs at the federal |