EDA reauthorized: What are the key implications?
President Biden signed legislation that reauthorized the Economic Development Administration (EDA) on Jan. 4. With the Heritage Foundation, among others, consistently calling for EDA’s elimination, EDA’s reauthorization is no small feat on its own. The strong bipartisan support for the bill, which included provisions related to water resources development, is perhaps even more remarkable. The House approved it 339-18 on December 10, and the Senate passed it 97-1 on December 18. As authorizing legislation, it does not include funding, but it does contain provisions that are of importance to the technology-based economic development field. Among the provisions are modifications to cost share, new responsibilities and offices for EDA, and investment priorities that for the first time are approved by Congress.
The Tech Hubs and Build to Scale programs are authorized under a different part of the U.S. Code, and while technically not impacted by this legislation, EDA has broad discretionary authority in administering programs and may adopt some of the provisions for those programs unless prohibited by law.
Cost share will now be eased under the reauthorization. The federal share can increase to 60 percent, and funds from regional commissions (e.g., the Appalachian Regional Commission, Delta Regional Authority), which are funded by the federal government, can be considered part of the “non-federal” share. In areas with less than 10,000 residents, the federal share can go up to 100 percent.
Distress criteria are changed to add the following: low median household income of 80 percent or less; labor force participation rate of 90 percent or less; prime-age employment gap of 5 percent or more; and, expected economic dislocation and distress from energy industry transitions.
The legislation spells out in law for the first time investment priorities and that projects “shall be consistent with 1 or more of the following investment priorities:” critical infrastructure, workforce, innovation and entrepreneurship, economic recovery resilience or manufacturing. If the Secretary uses a different investment priority, the Secretary shall submit a “written notification that explains the basis for using that investment priority” to the House and Senate oversight committees.
Regional directors may now designate a staff member to act as a technical assistance liaison. The liaison shall work in coordination with an economic development representative to provide technical assistance to eligible recipients that are underresourced communities as determined by the liaison.
Also included is new authorization for:
- assistance to communities “adversely impacted by a contraction event in the coal economy” and “to assist with economic development in nuclear host communities” where the plant has shut down or will cease operations;
- grants “to support the development and expansion of innovative workforce training programs through sectoral partnerships…”;
- grants for broadband projects; and
- a grant program for critical supply chain site development to “carry out site development or expansion projects for the purpose of making the site ready for manufacturing projects.”
Finally, the legislation creates the Office of Tribal Economic Development, the Mid-Atlantic Regional Commission, and the Southern New England Regional Commission. The significance of the two commissions will depend on future Congresses appropriating funds for them.
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