Empowerment Zones Program
Published on AidPage by IDILOGIC
on Jun 24, 2005
Purpose of this program:
The purpose of this program is to provide for the establishment of Empowerment Zones, Enterprise Communities and Renewal Communities in urban and rural areas, to stimulate the creation of new Jobs empowering low-income persons and families receiving public assistance to become economically self-sufficient, particularly for the disadvantaged and long-term unemployed, and to promote revitalization of economically distressed areas. The Renewal Community, Empowerment Zone and Enterprise Community (RC/EZ/EC) program rebuilds communities in America's poverty-stricken inner-cities and rural heartland by inspiring Americans to work together to create jobs and opportunity. Under this program, the Federal government has designated areas that meet certain poverty and distress criteria and prepare creative strategic plans for revitalization. During Round I, the Secretary of Housing and Urban Development designated eight urban Empowerment Zones and 65 Enterprise Communities, and the Secretary of Agriculture designated 33 rural Empowerment Zones and Enterprise Communities. Round I designated areas receive Federal grant funds from the Department of Health and Human Services, Social Services Block Grant (Title XX). In addition they receive special tax benefits and special consideration for funding under other Federal programs. During Round II the Secretary of HUD designated 15 additional urban Empowerment Zones in December 1998. Round II EZs are receiving tax incentives and Federal grants. In December 2001, HUD and USDA designated 8 new urban and 2 new rural Empowement Zones, respectively. HUD also designated 40 Renewal Communities, 28 in urban areas and 12 in rural areas. These Round III EZs and Renewal Community designees will receive tax incentives. Congress provided limited grant funding to the 2 Round III rural EZs in 2004.total area of the noncontiguous parcels must not exceed 2,000 acres; (f) Is located entirely within the jurisdiction of the unit or units of general local government making the nomination, and is located in no more than two contiguous States; and (g) Does not include any portion of a central business district, as this term is used in the most recent Census of Retail Trade, unless the poverty rate for each census tract in the district is not less than 35 percent.
Possible uses and use restrictions...
DESIGNATION AS AN EMPOWERMENT ZONE. Currently, each urban EZ is receiving such amounts as indicated by Congress on a year-to-year basis over the life of the program.
Who is eligible to apply...
(Note: This criteria is for the "urban zone" applicants. Eligibility criteria for Renewal Communities may differ slightly. Interested parties are advised to Review the Community Renewal Tax Relief Act of 2000 or visit the urban EZ/EC website at www.hud.gov/cr for more detailed eligibility criteria for Renewal Communities. Also, see the Dept of Agriculture section for "rural zone" applicant eligibility.) A nominated urban area may be eligible for designation if the area: (a) Has a maximum population which is the lesser of (1) 200,000 or (2) the greater of 50,000 or 10 percent of the population of the most populous city located within the nominated area; (b) is one of pervasive poverty, unemployment and general distress; (c) does not exceed twenty square miles in total land area; (d) demonstrates a poverty rate which is not less than: (1) 20 percent in each census tract; (2) for at least 90 percent of the census tracts within the nominated urban area, the poverty rate must be not less than 25 percent; (3) census tracts with no population are treated as having a poverty rate that meets the standards of (l) and (2) above; and (4) a census tract that has a population of less than 2,000 is treated as having a poverty rate that meets the requirements of (l) and (2) above if more than 75 percent of the tract is zoned for commercial or industrial use; (e) Has a continuous boundary, or consists of not more than six(6)noncontiguous parcels. A nominated urban area must not contain a noncontiguous parcel unless such parcel separately meets the criteria set forth in (1) and (2) above, except for sites that can be developed. The total area of the noncontiguous parcels must not exceed 2,000 acres; (f) Is located entirely within the jurisdiction of the unit or units of general local government making the nomination, and is located in no more than two contiguous States; and (g) Does not include any portion of a central business district, as this term is used in the most recent Census of Retail Trade, unless the poverty rate for each census tract in the district is not less than 35 percent.
Interested parties should visit the urban RC/EZ/EC website (www.hud.gov/cr) and the rural EZ/EC website (www.ezec.gov) periodically for updated information on applying for future designations. There is no funding available to make additional Renewal Community or Empowerment Zone designations in 2004. The following describes what was required from Round III EZ applicants and what could be required in a comprehensive strategic plan for future applicants: The strategic plan, which accompanies the application for designation, must be developed in accordance with four key principles:(1) strategic vision for change, which identifies what the community will become and a strategic map for revitalization; (2) community-based partnerships, involving the participation of all segments of the community; (3) economic opportunity, including job creation within the community and throughout the region; and (4) sustainable community development, to advance the creation of livable and vibrant communities through comprehensive approaches that coordinate economic, physical, environmental, community and human development. The strategic plan must include the following elements: (l) vision and values the community's strategic vision for change, a statement of what the community wishes to be like in the future, and a statement of the community's values that guided the creation of the vision; (2) community assessment - a comprehensive assessment of existing conditions and trends within the community, which includes, as a minimum: (i) assessment of problems and opportunities; (ii) resource analysis; (3) goals - a statement of a comprehensive and holistic set of goals to be achieved through implementation of the strategic plan throughout the l0-year implementation period, and a statement of the strategies the community proposes to use to achieve the strategic plan goals, and the identification of priority objectives; (4) implementation plan is a detailed plan that outlines how the community will implement its strategic plan over the first two-year implementation period. The plan will include: projects and programs, tax incentive utilization plan, governance plan, and community performance assessment; (5) strategic planning process documentation - a description of the process the community used to select the boundaries of the proposed Empowerment Zone, including the developable sites and to prepare the strategic plan; and (6) documentation of commitments - letters of commitment, resolutions committing public or private resources, and other documentation that will demonstrate the level of public and private resources, both inside and outside the nominated area, that will be available to implement the strategic plan and increase economic opportunity in the nominated Empowerment Zone.
Note:This is a brief description of the credentials or documentation required prior to, or along with, an application for assistance.
About this section:
This section indicates who can apply to the Federal government for assistance and the criteria the potential applicant must satisfy.
For example, individuals may be eligible for research grants, and the criteria to be satisfied may be that they have a professional or scientific degree,
3 years of research experience, and be a citizen of the United States. Universities, medical schools, hospitals, or State and local governments may also be eligible.
Where State governments are eligible, the type of State agency will be indicated (State welfare agency or State agency on aging) and the criteria that they
Certain federal programs (e.g., the Pell Grant program which provides grants to students) involve intermediate levels of application processing, i.e., applications
are transmitted through colleges or universities that are neither the direct applicant nor the ultimate beneficiary. For these programs,
the criteria that the intermediaries must satisfy are also indicated, along with intermediaries who are not eligible.
How to apply...
(Note: Nomination criteria for Renewal Communities may differ slightly. Please consult the urban EZ/EC website (www.hud.gov/cr) or the rural EZ/EC website (www.ezec.gov) periodically for updated information). Nomination criteria for urban Round III EZs was: One or more local governments and the State or States in which an urban area is located may nominate such area for designation as an Empowerment Zone if: (1) The urban area meets the requirements for eligibility; (2) the urban area is within the jurisdiction of a State or States and local government(s) that have the authority to nominate the urban area for designation and that provide written assurances satisfactory to the Secretary that the strategic plan will be implemented; (3) all information furnished by the nominating State(s) and local government(s) is determined by the Secretary to be reasonably accurate; and (4) the State(s) and local government(s) certify that no portion of the area nominated is already included in an Empowerment Zone or in an other area currently nominated for designation as an Empowerment Zone (but it may include an Enterprise Community).
Note: Each program will indicate whether applications are to be submitted to the Federal headquarters, regional or local office, or to a State or local government office.
The Secretary of HUD will review applications for the designation of nominated urban areas to determine the quality of the strategic plans submitted by nominating State local government(s); other factors established by HUD; and geographic diversity.
Note: Grant payments may be made by a letter of credit, advance by Treasury check, or reimbursement by Treasury check.
Awards may be made by the headquarters office directly to the applicant, an agency field office, a regional office,
or by an authorized county office. The assistance may pass through the initial applicant for further distribution by
intermediate level applicants to groups or individuals in the private sector.
Deadlines and process...
Applications must be received by the deadline established by the Secretary of HUD.
When available, this section indicates the deadlines for applications to the funding agency which will
be stated in terms of the date(s) or between what dates the application should be received.
When not available, applicants should contact the funding agency for deadline information.
Range of Approval/Disapproval Time
4 to 6 months following application deadline.
None. This program is excluded from coverage under E.O. 12372.
This section indicates whether any prior coordination or approval is required with governmental or nongovernmental units
prior to the submission of a formal application to the federal funding agency.
The Secretary of HUD may waive for good cause any provision of the program not required by statute, where it is determined that the requirement would produce a result adverse to the purpose and objectives of the program.
In some cases, there are no provisions for appeal. Where applicable, this section discusses appeal procedures or allowable rework time for resubmission
of applications to be processed by the funding agency. Appeal procedures vary with individual programs and are either listed in this section or
applicants are referred to appeal procedures documented in the relevant Code of Federal Regulations (CFR).
To be determined.
In some instances, renewal procedures may be the same as for the application procedure, e.g., for projects of a non-continuing nature renewals will be treated as new, competing applications; for projects of an ongoing nature, renewals may be given annually.
Who can benefit...
Residents and businesses in designated urban areas.
About this section:
This section lists the ultimate beneficiaries of a program, the criteria they must satisfy and who specifically is not eligible. The applicant and beneficiary will generally be the same for programs that provide assistance directly from a Federal agency. However, financial assistance that passes through State or local governments will have different applicants and beneficiaries since the assistance is transmitted to private sector beneficiaries who are not obligated to request or apply for the assistance.
What types of assistance...
The funding, for fixed or known periods, of specific projects. Project grants can include fellowships, scholarships, research grants, training grants, traineeships, experimental and demonstration grants, evaluation grants, planning grants, technical assistance grants, survey grants, and construction grants.
How much financial aid...
Range and Average of Financial Assistance
$5.4 million per year for each Round I and II urban EZ. At this time, Renewal Communities and Round III EZs are to receive tax incentives only.
This section lists the representative range (smallest to largest) of the amount of financial assistance available. These figures are based upon funds awarded in the past fiscal year and the current fiscal year to date. Also indicated is an approximate average amount of awards which were made in the past and current fiscal years.
FY 03 $29,805,000; and FY 04 est $14,911,500; and FY 05 est $0. (NOTE: Amounts reported reflect allocation of new budget authority rather than obligation amounts.)
The dollar amounts listed in this section represent obligations for the past fiscal year (PY), estimates for the current fiscal year (CY), and estimates for the budget fiscal year (BY) as reported by the Federal agencies. Obligations for non-financial assistance programs indicate the administrative expenses involved in the operation of a program.
Note: This 11-digit budget account identification code represents the account which funds a particular program.
This code should be consistent with the code given for the program area as specified in Appendix III of the Budget of the United States Government.
Examples of funded projects...
About this section
This section indicates the different types of projects which have been funded in the past. Only projects funded under Project Grants or Direct Payments for Specified Use should be listed here. The examples give potential applicants an idea of the types of projects that may be accepted for funding. The agency should list at least five examples of the most recently funded projects.
On December 31, 2001, HUD designated 8 new Urban Round III Empowerment Zones, as well as 40 Renewal Communities in urban and rural areas nationwide. The 8 new EZs are: Pulaski county AR; Fresno, CA; Jacksonville, FL; Syracuse, NY; Yonkers, NY; Oklahoma City, OK; San Antonio, TX; Tucson, AZ. Please see the Website for a listing of the 40 Renewal Communities. USDA designated 2 new Rural Empowerment Zones, Aroostook, ME and Middle Rio Grande, TX.
Criteria for selecting proposals...
Interested parties should visit the urban EZ/EC website (www.hud.gov/cr) and the rural EZ/EC website (www.ezec.gov) periodically for updated information. The following describes criteria used for selecting Round III EZ applicants and what could be required for future rounds. In choosing among nominated urban areas eligible for designation, the Secretary shall consider: (1) The quality of the strategic plan in accordance with the key principles and evaluative criteria set forth in subsection 598.215. (2) The effectiveness of the assurance made that the strategic plan will be implemented. (3) The extent to which an application proposes activities that are creative and innovative in comparison to other applications. (4) Such other factors established by HUD. Such factors include, but are not limited to, the degree of need demonstrated by the nominated area. HUD, in its discretion, may choose to select for designation a lower rated approvable application over an otherwise higher rated application in order to increase the level of geographic diversity of designations made under the program.
Length and Time Phasing of Assistance
Period of designation: The December 31, 2001 designation of areas as new Empowerment Zones and Renewal Communities shall remain in full effect during the period beginning on the date of designation and ending on the earliest of: (a) December 31, 2009; (b) The termination date designated by the State and local governments in their application for nomination; or (c) The date the Secretary modifies or revokes the designation.
Formula and Matching Requirements
A formula may be based on population, per capita income, and other statistical factors. Applicants are informed whether there are any matching requirements to be met when participating in the cost of a project. In general, the matching share represents that portion of the project costs not borne by the Federal government. Attachment F of OMB Circular No. A-102 (Office of Management and Budget) sets forth the criteria and procedures for the evaluation of matching share requirements which may be cash or in-kind contributions made by State and local governments or other agencies, institutions, private organizations, or individuals to satisfy matching requirements of Federal grants or loans.
Cash contributions represent the grantees' cash outlay, including the outlay of money contributed to the grantee by other public agencies, institutions, private organizations, or individuals. When authorized by Federal regulation, Federal funds received from other grants may be considered as the grantees' cash contribution.
In-kind contributions represent the value of noncash contributions provided by the grantee, other public agencies and institutions, private organizations or individuals. In-kind contributions may consist of charges for real property and equipment, and value of goods and services directly benefiting and specifically identifiable to the grant program. When authorized by Federal legislation, property purchased with Federal funds may be considered as grantees' in-kind contribution.
Maintenance of effort (MOE) is a requirement contained in certain legislation, regulations, or administrative policies stating that a grantee must maintain a specified level of financial effort in a specific area in order to receive Federal grant funds, and that the Federal grant funds may be used only to supplement, not supplant, the level of grantee funds.
Post assistance requirements...
HUD will require periodic reports for the Empowerment Zones and Renewal Communities designated pursuant to this part. These reports will identify the community, local government and State actions which have been taken in accordance with the strategic plan and tax incentive utilization plan. In addition to these reports, such other information relating to designated Empowerment Zones and Renewal Communities as HUD shall request from time to time, including information documenting nondiscrimination in hiring and employment by business within the designated Empowerment Zone or Renewal Community, shall be submitted promptly.
This section indicates whether program reports, expenditure reports, cash reports or performance monitoring are required by the Federal funding agency, and specifies at what time intervals (monthly, annually, etc.) this must be accomplished.
Periodic performance reviews. HUD will regularly evaluate the progress of the strategic plan and tax incentive utilization plan in each designated Empowerment Zone and Renewal Community on the basis of performance reviews to be conducted on site and other information submitted. HUD may also commission evaluations of the Empowerment Zone and Renewal Community programs as a whole by an impartial third party, at such intervals as HUD may establish.
This section discusses audits required by the Federal agency.
The procedures and requirements for State and local governments and nonprofit entities are set forth in OMB Circular No. A-133.
These requirements pertain to awards made within the respective State's fiscal year - not the Federal fiscal year,
as some State and local governments may use the calendar year or other variation of time span designated as the fiscal year period,
rather than that commonly known as the Federal fiscal year (from October 1st through September 30th).
This section indicates the record retention requirements and the type of records the Federal agency may require.
Not included are the normally imposed requirements of the General Accounting Office.
For programs falling under the purview of OMB Circular No. A-102, record retention is set forth in Attachment C.
For other programs, record retention is governed by the funding agency's requirements.
Omnibus Budget Reconciliation Act of 1993, Title XIII, Public Law 103-66, Sections 952-954; Taxpayer Relief Act of l997, Public Law l05-34; Community Renewal Tax Relief Act of 2000, Public Law 106-554.
This section lists the legal authority upon which a program is based (acts, amendments to acts, Public Law numbers, titles, sections, Statute Codes, citations to the U.S. Code, Executive Orders, Presidential Reorganization Plans, and Memoranda from an agency head).
Regulations, Guidelines, And Literature
24 CFR Part 598 and 599 Designation of Round III Urban Empowerment Zones and Renewal Communities; Interim Rule. Also, see "Tax Incentive Guide for Business in the Renewal Communities, Empowerment Zones and Enterprise Communities," available by calling 1-800-998-9999.