Text File

h:\econplan\clinton\part4.txt

Investing in the Future: Increasing Public Investment

We must invest more in our people, in their jobs and in the future...

Bill Clinton

Even after economic recovery is assured, our real economic challenges remain long term. The Administration's vision of public investment to improve our people's productivity involves initiatives in a wide range of critical physical and human capital priorities.

Rebuild America

Transportation

While our economic competitors have invested heavily in their infrastructure, we have not done as well. To regain our economic edge, we must invest more. We will upgrade our nation's roads, bridges, mass transit, and airports; support high-speed rail links between major cities; and create "information highways" that link homes, businesses, schools and libraries to databases and public records. These initiatives will put Americans back to work, spur productivity, and make transportation safer, faster and easier for all Americans.

DOT/Expand the Federal-aid highway program to the levels contained in the Intermodal Surface Transportation Efficiency Act (ISTEA). Full-funding of ISTEA will maintain conditions and performance on the nation's most important roads, the National Highway System. It calls for $2.6 billion in obligations in 1994 above baseline spending amounts. The total increase through 1997 is $5.6 billion in outlays, targeted to high priority projects. This initiative will create approximately 14,000 new jobs in 1994, and about 150,000 over a four year period.

DOT/Accelerate "Smart cars/smart highways" (part of Federal-aid highway program). The Intelligent Vehicle-Highways Initiative (IVHS) (also known as "Smart cars/smart highways") will improve traffic control systems, warn drivers of dangerous situations, and make more efficient use of the existing highway infrastructure. It will combine state-of-the-art communications, warning systems, electronic displays, and computer technology. IVHS also has the potential to make innovative highway policy such as "congestion pricing" a reality. The new funding would increase advanced technology development (including artificial intelligence, machine vision, and other defense-related technologies) that will make the highways of the next century both safer and more efficient. 1997 obligations will exceed the baseline by $100 million and 1994-1997 obligations will exceed the baseline by $345 million, a 50 percent increase over the baseline.

DOT/Increase funding for mass transit capital improvements. This proposal implemented through the Federal Transit Administration's formula grant programs will upgrade rail facilities and equipment by beginning to eliminate a rail investment backlog recently estimated at $14 billion. The additional funds will also replace ancient buses, vans and rail cars still in the U.S. transit fleet. These newer vehicles will be not only safer and more efficient, but also more accessible to disabled persons. Over four years an estimated $1.2 billion will be invested (outlays), creating about 83,000 jobs.

DOT/Investment in magnetic levitation (maglev) and high-speed rail transportation. Maglev and high-speed rail systems can meet the transportation needs of several of the nation's high-density corridors. These systems could relieve congestion, improve air quality, reduce consumption of petroleum-based fuels and improve safety. The funds could be used for construction of a maglev prototype and/or to support the start-up of private or State/local high-speed rail projects. Total increased outlays: over 1994-1997 about $646 million; 1997 $258 million.

DOT/Alcohol-related highway safety grants and other DOT capital. These grants to States will support programs that reduce alcohol-related traffic accidents and increase the use of safety belts and motorcycle helmets. Other DOT capital funds two important safety and environmental-protection projects in the maritime area: (1) state-of-the-art Vessel Traffic Systems (VTS) in busy ports and harbors, which reduce maritime accidents and the threat of hazardous materials and oil spills; and (2) replacement of seagoing and coastal buoy tenders many of which are over 50 years old. The new vessels carry oil recovery systems and require smaller crews, saving operating costs. Total increased outlays: over 1994-1997 $201 million; 1997 $88 million.

DOT/Increase funding for airport grants. Investing in airport development projects at both large and small airports will speed air travel, link remote communities with opportunities elsewhere, and open up airports to different aircraft and aviation uses. These projects include building or expanding runways to increase capacity, removing obstructions to improve safety, or adding terminal facilities and airport taxiways to speed the movement of airplanes on the ground. Noise abatement projects permit these improvements to occur while minimizing the impact on surrounding communities. Outlays over 4 years: $108 million. 1997 outlays: $44 million.

DOT/Increase funding for air traffic control modernization. Growth in air travel is expected to result in more than a 25 percent increase in aircraft operations at our major airports in the next 10 years. The Federal Aviation Administration's multi-year air traffic control modernization program, which will help address this growth includes new radars, computers, controller workstations and communications equipment, and the supporting R&D. Benefits will include reduced air travel delays, more efficient aircraft routing, fewer accidents and the more cost-effective operation of the air traffic control system. Investment (budget authority) over 4 years: $720 million. 1997 investment: $200 million. Over 2,000 jobs will be created.

DOT/Public land highways and Indian reservation roads. Many national parks, forests, and Indian reservations are located in rural areas of the country where roads are unpaved or impassable. Good roads ensure that visitors have safe access to national parks and forests, and are critical to economic development opportunities on Indian reservations. Investment in upgrading these roads will reduce the acknowledged backlog of projects in excess of $15 billion. Estimated outlays: $295 million in 1994-1997; $153 million in 1997.

Environment

A healthy environment means a better future for generations of Americans to come, and it also means jobs. The investments outlined here will create tremendous new opportunities for Americans to develop advanced systems to recycle, treat toxic waste and clean our air and water. Together, these investments prove that there is no choice between spurring economic growth and protecting the environment that we can and must do both at once.

EPA/Drinking water state revolving funds. Provide $599 million in 1994 and $1 billion per year for 1995 to 1997 in new grants for low-interest loans to help municipalities comply with the Safe Drinking Water Act (SDWA) which is estimated to require $10 billion in water infrastructure upgrades between now and 1998. Estimated outlays: over four years $1.3 billion; in 1997 $692 million.

EPA/Clean water state revolving funds. Provide $1,198 million in 1994 and $2 billion per year for 1995 to 1997 under a new authorization for capitalizing Clean Water State Revolving Funds (SRFs). These SRFs would make low-interest loans to municipalities for construction of projects to address water quality problems. If these capitalization grants are leveraged in the financial markets (as allowed under the Clean Water Act), States could have up to $6 billion available annually for clean water project loans. Funding for waste water (as well as drinking water) projects in rural areas can be obtained also through USDA loans and grants. Estimated outlays: over four years 1994-1997 $2.7 billion; 1997 $1.4 billion.

Interior and USDA/Natural resource protection and environmental infrastructure initiative. Building on the stimulus initiative, this proposal would protect and rehabilitate America's inventory of natural and cultural assets, restore the facilities that protect these resources, and improve public access to them. This funding would help to eliminate the backlog of resource protection projects, facility maintenance, rehabilitation and construction and other similar projects in rural and urban areas. The work would be located at resource areas managed by the Department of the Interior (National Park Service, Fish and Wildlife Service, Bureau of Land Management, and Bureau of Indian Affairs), and by the Department of Agriculture (Forest Service). This investment would create more than 5,500 jobs in 1994. It calls for an estimated investment of $1.5 billion in 1994-1997 outlays; $509 million in 1997 outlays.

Interior/Bureau of Indian Affairs (BIA) safety of dams. In 1989, the Department of the Interior's Inspector General reported that more than half of the high-risk dams on Indian reservations were in poor or unsatisfactory condition. This proposal will ensure that urgently needed rehabilitation and repair work can proceed. It calls for outlays of $59 million in 1994-1997; $23 million in 1997.

Reduce backlog of water resource Corps of Engineers cyclic maintenance projects. Corps of Engineers water projects provide flood damage reduction, inland and harbor waterway transportation, hydropower, and environmental restoration benefits. The projects, though, are aging: more than 50 percent of these projects are over three decades old. Nearly one quarter exceed 50 years of age. In spite of a growing backlog, resources for these projects have stayed largely constant. Estimated expenditures: over four years $544 million; 1997 $160 million.

EPA/Watershed resource restoration. This proposal would double the current funding level of $50 million annually by 1995 for non-point source grants under Section 319 of the Clean Water Act. Non-point source pollution, such as runoff from farms, mining sites and city streets is now the largest cause of pollution in our Nation's waters. Reductions in non-point source pollution will help restore watersheds and estuaries, leading to increased numbers of fish and other aquatic life, and improving fishing and recreational opportunities in urban, suburban, and rural areas. Estimated outlays: over four years $139 million; 1997 $47 million.

DOE/Cleanup of non-defense sites and uranium enrichment facilities. The Department of Energy is responsible for the management and disposal of radioactive and hazardous wastes resulting from research and uranium enrichment activities conducted by the Department of Energy. The investment supported by this Administration reflects the emphasis that it places on reversing the imbalance in priorities, by placing more priority on the environment. Outlays will increase $220 million between 1994 and 1997, and $107 million in 1997 alone.

USDA/Forests for the Future. Vice President Gore stated that "forests represent the single most important stabilizing feature of the Earth's land surface" in his book Earth in the Balance. The Administration proposes to invest $30 million in 1994 and $50 million in each of the next four years, towards the international goal of reducing world-wide deforestation. At the 1992 Rio "Earth Summit", the U.S. proposed that all countries join in doubling international forest assistance. This investment will be a down payment towards that commitment, to fund initial partnership activities with foreign nations and domestic and international non-governmental organizations. Funds would be used, in part, to support integrated resource management, assist scientific research on tropical forests and biodiversity, assist local communities in forest resource management, improve inventory and management of large forests, develop institutions that can attract private investment in forest conservation, and reforest degraded lands. Estimated outlays; over four years $170 million; 1997 $50 million.

NOAA Weather Service modernization. NOAA is now in the process of modernizing National Weather Service systems. Under the Administration's plan, by the turn of this century, NOAA will operate one of the most advanced weather warning and prediction networks in the world. New observation systems such as doppler radars and weather satellites will provide for more accurate and timely forecasts of severe weather events and for more reliable forecasts. These improvements will translate into lives saved and damages averted. They will also benefit all sectors of the economy that rely on accurate warnings and forecasts for planning. Estimated investment (budget authority): $35 million in 1997; $293 million over 1994-1997.

EPA/Environmental technology. This proposal would increase funding for environmental engineering and technology development by $36 million in 1994, a total of $626 million through 1998, and a total of $1.85 billion over nine years. EPA currently allocates about $120 million annually to these activities. The focus of this initiative will be long-term research and pollution prevention by EPA, other Federal agencies, and the private sector. The goal is to develop more advanced environmental systems and treatment techniques that can yield environmental benefits and increase exports of "green" technologies. This investment will aid in the transition away from a defense-oriented economy, by stimulating the increased use of private-sector R&D resources for environmental quality-related purposes. Estimated outlays: over four years 1994-1997 $271 million; 1997 $127 million.

Expand EPA's voluntary "green" programs. EPA launched its "Green Lights" program two years ago to encourage Fortune 500 companies to convert profitably into more energy-efficient lighting, which will reduce electricity generation and greenhouse gas emissions. EPA identifies profitable opportunities for companies to conserve energy and enlists participants to install the energy conservation measures. As of October 1992, Green Lights participants had committed over 2.8 billion square feet of facility space to the program the equivalent of all the office space in our eight biggest cities. EPA estimates that expanded "green" programs such as this one can reduce greenhouse gas emissions by 75-108 million metric tons of carbon by year 2000. Estimated outlays: over four years 1994-1997 $69 million; 1997 $25 million.

USDA/Tree planting initiative. Reforestation on the huge tracts of poorly managed private, nonindustrial forests can result in increased environmental benefits such as removing more carbon dioxide from the air. These benefits of tree planting also make it important for urban forests because of their location in and around population centers. In addition to the environmental benefits, urban forestry programs can provide productive seasonal jobs for inner city youth. Estimated outlays 1994 $33 million; 1994-1997 $246 million.

USDA/National research initiative (NRI) grants. Top flight R & D is needed to assure the continued competitiveness of U.S. agricultural products in global trade, ensure the food supply's safety and quality, and sustain natural resources. NRI grants are awarded competitively after a stringent peer-review process to ensure that the most qualified research proposals are chosen. The NRI funds research in animal and plant biotechnology (including genome mapping), food safety, sustainable agricultural production practices, and technologies to manufacture new agricultural materials. Because the competitive grants program focuses primarily on basic research, the results of many projects would be useful to scientists in other disciplines. Five hundred more projects will be funded each year by this increase. Estimated increased outlays: over four years $188 million; in 1997 $110 million.

USDA/Forestry research initiative. Managing the Nation's forest resources relies increasingly upon scientific information and technology. This includes areas as diverse as understanding forest ecosystems and the wildlife/urban interface, to research on extending the use of wood as a raw material. This investment will allow the Forest Service and other USDA research agencies to increase the breadth and depth to which forestry research areas are investigated, providing the necessary information to help the Nation develop sound forest-related policies that will both provide resources to meet ever-increasing demands from the population and sustain forest ecosystems. The initiative would be funded at $287 million over four years. Estimated outlays: 1994 $16 million; 1994-1997 $261 million.

Rural Development Initiative

Family farmers have made a unique contribution to this nation's growth, feeding our people and caring for our land. This initiative would provide resources to improve rural infrastructure, which provides the necessary underpinning for rural economic development. It would also directly assist rural communities and businesses to improve the quality of rural life and increase employment opportunities in rural areas.

USDA/Increase RDA rural water and waste water loans and grants. Federal and State regulators report that drinking water and sewage treatment systems serving small, mostly rural populations currently have the highest rates of noncompliance with Federal environmental standards. To comply with clean water standards set by EPA, rural America's water and waste water needs total roughly $10 billion by the year 2000. Often these small rural communities are unable to meet these expensive standards without Federal assistance. The Rural Development Administration (RDA) administers a water and waste water loan and grant program that targets rural communities of up to 10,000 in population whose average income is at or below 80 percent of State median income. This proposal increases RDA loan authority from $600 million to $780 million, and its grant authority from $390 million to $510 million in 1994; and to $900 million and $590 million respectively each year 1995 through 1997. Additional funding for drinking water and waste water construction is proposed through EPA for new drinking water and clean water grants to State revolving funds. Estimated RDA outlays: over four years 1994-1997 $331 million; 1997 $176 million.

Community and business assistance. This initiative would provide Federal assistance to rural communities, businesses, and individuals, by leveraging Federal investment to allow rural areas to help themselves. Farmers Home Administration (FmHA) direct loans for community facilities would be increased by $300 million in 1994, and $500 million thereafter, for construction of rural health care clinics, fire stations and equipment, and other vital facilities. Rural Development Administration (RDA) guaranteed loans for rural businesses and industries would be increased by $300 million in 1994 and $500 million thereafter to assist rural businesses in securing start-up capital and financing for expansion, creating jobs and helping diversify the rural economy. Additional rural business assistance would be provided through the RDA Intermediary Relending Program that provides one percent loans to State-sponsored rural development programs who, in turn, re-lend to rural businesses. These funds (an additional $150 million in 1994 loans, and an additional $250 million in loans each year through 1997) would be targeted to small, emerging "micro-enterprises." In addition, RDA rural development grants would be increased by $30 million in 1994, and $50 million thereafter. Business assistance would be coordinated through RDA's existing State Rural Development Councils, whose members include representatives from Federal, State and local government agencies, as well as the private sector.

These investments would provide increased employment opportunities for rural individuals, and upgrade community infrastructure to improve the quality of life for all rural residents. The investment proposal also would improve the housing conditions of low-income, rural individuals. FmHA direct and guaranteed homeownership loans would be increased by $300 million each in 1994, and by $500 million each year 1995 through 1998. Rental assistance in rural areas would also be provided through housing vouchers and grants for use in FmHA-financed rental units. Vouchers would be targeted for areas where rental units are available, but not currently affordable for low-income persons. A total of $150 million in additional rental assistance would be provided through these programs in 1994, and $300 million each year from 1995 to 1998. Estimated RDA outlays for community and business assistance; over four years 1994-1997 $1,115 million; 1997 $454 million.

Energy

Without thoughtful energy policies, our nation will remain dependent on foreign oil and special interests. The Administration will launch initiatives to develop new, clean, renewable energy sources that cost less and preserve the environment. We will also encourage energy efficiency and conservation to lower the energy bill for middle-class Americans, and lessen our vulnerability to events outside our control.

DOE/Increase funding for renewable energy and energy conservation programs. The Energy Policy Act of 1992 contains new responsibilities for the Federal government including: (1) establishment of new energy efficiency standards; (2) authorization for enhanced research programs; and (3) new demonstration/commercialization programs for renewable energy and energy conservation. This initiative progressively increases funding in these areas, reaching an increase of $500 million in 1997, for a four-year total increase of $1.3 billion. The increased funding will be distributed roughly equally among the four major program areas: solar and renewable energy, and industrial, transportation, and buildings conservation R&D. The largest increases will go to technology transfer and commercialization, advanced materials (especially ceramics), industrial wastes and materials processing, electric and hybrid vehicles, and modeling of building systems interactions. By making a major effort to develop and commercialize these environmentally "clean" technologies, substantial energy cost savings will be realized by consumers while creating enormous opportunities for economic growth and increased jobs.

DOE/Increase weatherization assistance program. This Department of Energy program provides funds to States to help pay for home weatherization improvements for low-income citizens. The increase proposed here, $60 million in 1994, and $100 million per year in 1995-97, would be distributed differently than the typical "formula grants," in order to increase the leverage received on taxpayer funds. Matching funds (at least 1:1) will be required from States or utilities. This will encourage State weatherization programs to take advantage of utilities' demand-side management (rebate and discount) programs, and will ensure that the funds go to States that demonstrate a serious commitment to low-income weatherization activities. With 1:1 leveraging of these funds, an additional 450,000 homes will be weatherized over the currently projected number for the 1994-97 period.

Increase the energy efficiency of Federal buildings and facilities. Current Federal investment in energy efficiency improvements is running around $150 million per year. This initiative will increase spending to almost $500 million per year by 1996. The cumulative increase will be $1 billion over four years. The four biggest energy-consuming agencies Defense, Energy, Veterans Affairs and the General Services Administration will receive increased funding for their in-house energy management programs directly. In addition, a fund will be established at the Department of Energy for energy efficiency improvements proposed by all of the remaining Federal agencies. Over 700 energy managers will be trained in 1994, and over 2,000 per year in 1995-98. Outside energy audit teams will review 600 Federal sites in 1994, starting with the largest energy consumers, and 1,000 sites per year in 1995-98. By 1997 these investments should payoff heavily, saving the Government about $350 million per year.

Provide increased funds for acquisition of alternative fuel vehicles for the Federal fleet, and for conversion of existing vehicles. This initiative provides $18 million in 1994, and $30 million per year from 1995 through 1998 for the purchase and/or conversion of petroleum based gasoline powered motor vehicles to alternatively fueled vehicles. This expands upon the Alternative Motor Fuels Act (AMFA) purchases currently funded by appropriations to the Department of Energy.

DOE/Increase natural gas utilization R&D. This initiative will roughly double the combined natural-gas spending of the Conservation and Fossil R&D programs. A critical new feature is to involve segments of the natural gas industry in the design and operation of research programs. This will help ensure that the enhanced R&D is relevant to the needs of industry and the market place. It will also provide an opportunity for private sector cost-sharing, thereby increasing the overall level of gas research. In the combined programs, this initiative will increase spending on natural gas utilization by $14 million in 1994, increasing to $119 million in 1997, for a total of $263 million in additional spending over that four-year period.

Build an advanced neutron source a user facility for applied research and development. This proposal would fund the design and construction of a national user facility to produce rare isotopes for medical diagnosis, treatment and research and to perform applied research using neutron scattering and neutron irradiation techniques. The facility, called the Advanced Neutron Source (ANS), would be used by approximately 1,000 user groups each year. Users would come from industry, universities, and Federal laboratories. The medical isotopes produced could help tens of thousands of patients. Neutron scattering is a relatively new experimental technique with applications for materials science, metallurgy, crystallography, chemistry, industrial radiography, forensic detection of trace elements, biology, and biotechnology. The heart of the facility would be a new research reactor that would have the most intense beams of steady-state neutrons in the world approximately five to ten times higher than the current world leader at the Institute Laue-Langevin in Grenoble, France. The total projected cost of the facility is about $2.7 billion. The proposal adds $243 million in outlays over the baseline between 1994 and 1997.

DOE/Increase funding for fusion energy research. Fusion offers the promise of abundant energy from readily available fuels with low environmental impact. The centerpiece of the research effort in magnetic fusion energy is a collaboration among the United States, the European Community, Japan, and Russia to build an International Thermonuclear Experimental Reactor (ITER). Design and construction of ITER will be a multi-billion dollar effort that could take two decades to complete. The United States must maintain a vital domestic research program to support our efforts on ITER. Yet, the U.S. has not commissioned a major new machine for fusion research since the early 1970s. This investment would fund moderate growth in the U.S. fusion energy program above inflation to allow construction of a new facility, the Tokamak Physics Experiment (TPX). Estimated additional spending 1994 and 1997 is $210 million in outlays; ($90 million in 1997).

Community Development and Defense Conversion

If we are going to rebuild our nation, we will have to do it from the bottom up. These initiatives will empower the Americans who create jobs and raise incomes small businesses, entrepreneurs, and the dreamers with an idea and the initiative to make it work. They will make sure that the skills of our defense workers are not lost, but harnessed to the peacetime projects our future demands. And these initiatives will create real opportunity in America's inner cities because America will not prosper until our urban areas once again become engines of economic growth.

HUD/Provide additional funding for Community Development Block Grants (CDBG). Community development projects are an important source of jobs and economic development both in the short- and long-term. States and local governments have a backlog of unfunded "ready to go" projects such as basic street and bridge work, painting and resurfacing, building rehabilitation, and public service projects. However, the State and local needs continue to exceed the existing Federal contribution. The Administration's proposal would provide an additional $690 million between 1994-1998 to continue much-needed investment in America's communities. This additional funding would directly create about 60,000 jobs over the next five years, with even more jobs being created indirectly in the local economy. These funds are targeted at low- and moderate-income residents, providing assistance in areas with the greatest need. Because communities can select eligible activities most appropriate to their local circumstances, this additional funding will help communities where they need it most.

Enact enterprise zones legislation in order to promote investment and job creation in Federally-designated zones. The Administration's enterprise zone proposal will promote entrepreneurship and job creation in distressed urban and rural communities through a number of employment and investment incentives. The proposal includes such policies as an employer wage credit and an expansion of the targeted jobs tax credit in order to encourage low-income inner-city and rural residents to obtain employment, become self-supporting, and leave welfare. It also includes investment incentives designed to encourage individuals to invest in zones. Taken together, these incentives will be a critical factor in helping poorer cities and rural areas become economically more vital. Estimated outlays reach $2.4 billion over four years, with 1.2 billion in 1997.

Community Development Banks. Many American communities face problems of deteriorating housing, loss of jobs, lack of private enterprise, and declining economic and social infrastructure. A network of community development banks will be created to provide loans for business and housing purposes in distressed communities that have previously been underserved by traditional lending institutions. Government investment and technical assistance would supplement private funds and expertise to ensure community development banks' effectiveness in restoring healthy economic development in these communities. Estimated cost: over four years $354 million; 1997 $110 million.

SBA/Increase Section 7(a) loan guarantees. This program helps small businesses struggling to attract bank lending because of the general weakness of the economy. Building on a stimulus proposal, increased funding levels will be extended to assure that creditworthy small businesses have access to capital. These funds will make about 14,000 loans to individuals otherwise unable to expand or start small businesses. Estimated cost: over four years $501 million; 1997 $157 million.

Defense Conversion Program. With the end of the Cold War, the nation faces the challenge of the defense transition. How should we address the needs of the men, women, companies and communities who helped us win the Cold War but who now feel the impact of declining defense budgets? How do we best reinvest in the industrial, technological and workforce capabilities of the Cold War so they can play a role in our effort to make the nation globally competitive? Our economic plan is designed to face this challenge and to seize this opportunity.

Our defense conversion program builds on current efforts and increases investment funding. In the Department of Defense, we will propose additional funding for dual-use technology programs and for the community adjustment assistance activities of the Office of Economic Adjustment. In the Department of Labor, significant new investment funding will be requested to provide for the training and retraining of America's workforce, including those parts of the workforce displaced by defense spending reductions. In the Department of Commerce, we will request additional funding both for National Institute of Science and Technology programs helpful to industry and for the work of the Economic Development Administration supporting the economic diversification of communities hurt by defense reductions.

These programs will address the need for defense transition assistance in the industries, the workforce and the communities that experience the impact of declining defense budgets. In addition, our investment initiatives in high technology will help stimulate the "market pull" to provide new opportunities for high technology businesses and the highly skilled workforce currently in the defense market. To meet this goal, we are proposing spending for the Departments of Energy, Transportation and Commerce, and NASA, among others, on such technologies as high performance computing, aviation and aeronautics, transportation, space and manufacturing technology.

To ensure that the parts of this defense conversion program work together, activities will be coordinated through the Executive Office of the President and interagency committees.

This proposal provides additional funding of $555 million in 1997 for defense conversion, of which $480 million will go to the Department of Defense for dual-use technology and manufacturing programs. Funding of $20 million will be provided to DoD's Office of Economic Adjustment and $55 million to the Economic Development Administration in the Department of Commerce for community diversification. For the programs of the other agencies described above, additional initiatives in the investment package include about $2 billion for job training and $4 billion for the acquisition of high technology products and R&D. Estimated outlays of the Department of Defense and the Economic Development Administration parts of this proposal: over four years $1.5 billion; 1997 $520 million.

Revitalizing Technology

To move ahead of our competitors in technological research and development, this initiative will provide incentives to explore new technologies. It will create high-wage jobs and help push America toward the cutting edge of groundbreaking technologies. It will create markets that encourage the use of defense technology for civilian purposes and bring together businesses and universities in an effort to ensure that innovative products have the label "Made in America."

NSF/Enhancing university-based competitive science and engineering research in the U.S. Studies show that investments in research and development (R&D) tend to be the strongest and most consistent positive influence on productivity growth. Most of NSF's investments are in university-based R&D programs which are competitively selected on their merit by members of the science and engineering community. These activities contribute to the Nation's productivity by generating new scientific and engineering knowledge and contribute to the training of the next generation of scientists and engineers. In 1992, NSF had $1 billion of unfunded proposals that were rated excellent through peer review. Thus, it appears that NSF has the capacity to invest more funds in a broad range of important research areas, including strategically targeted research in improving our understanding of the climate system and improved engineering approaches to mitigate environmental problems; advanced computers and digital networks; biotechnology; materials processing; advanced manufacturing; math and science education; and smart highways, bridges, and other civil infrastructure. This proposal which adds $2.3 billion over four years, and $954 million in 1997 also includes funds to support the Nation's university-based research facilities and instrumentation.

Commerce/Increase civilian R&D at the National Institute of Standards and Technology (NIST). America's competitiveness rests ultimately with the private sector. Yet, the Federal Government has an important role to play in promoting economic growth, in part by supporting research and development. This proposal provides aggressive growth for the National Institute of Standards and Technology (NIST). NIST is the only Federal lab with the principal mission of supporting U.S. industry and has provided a steady stream of technology support to U.S. firms for over 90 years. This proposal provides for: 1) an increase of $138 million in 1994, rising to $680 million by 1997, for the Advanced Technology Program to provide matching grants for industry-led R&D projects, including funding for consortia like SEMATECH; 2) over 100 manufacturing extension centers nationwide by 1997 to assist manufacturers to modernize their production capability; and 3) doubling the amount of R&D performed in the NIST labs by 1998. This proposal would increase total NIST funding from $381 million in 1993 to $1.2 billion in 1997 (budget authority).

Commerce/"Information Highways" Demonstrations. The development of a broadband, interactive telecommunications network linking the Nation's businesses, schools, libraries, hospitals, governments, and others could pay enormous dividends to the U.S. economy. Engineers working on the same problem, teachers and students, and patients and doctors would all be able to communicate instantly no matter how much distance separated them. This proposal builds on the 1993 stimulus initiative by providing new seed money to "jumpstart" the development of these networks. In 1994, $54 million will be made available to the Department of Commerce for grants to States, local governments, universities, school systems, and non-profits to link public facilities in such a network. Between 1995 and 1998, $150 million annually would be made available.

Federal Coordinating Council for Science, Engineering, and Technology (FCCSET) initiatives. As the fields of science and technology have progressed, and as applications of scientific advances have improved, it has become obvious that a single field of science can have applications in numerous different areas, governed by different Federal departments and agencies. In order to coordinate scientific advances among agencies and to avoid duplication of efforts, the Federal Coordinating Council for Science, Engineering and Technology (FCCSET) has established interagency committees.

There are currently six specific areas, which have been identified as important national research and education activities. They are: improving our understanding of the climate system, advanced supercomputers and computer networks, math and science education, materials processing, biotechnology, and advanced manufacturing. The climate initiative, for example, is focused on understanding the processes involved in climate change and was a key component of the U.S. action plan in the recent "Earth Summit" negotiations. The advanced manufacturing initiative will focus on areas such as intelligent manufacturing cells and computer-based tools for production design. Over a dozen Federal agencies, including NASA, Defense, Energy, the National Science Foundation, Commerce, Agriculture, and the National Institutes of Health, have programs which address one or more of the six specific areas.

Crosscutting high performance computing (NSF/NIH/NASA/NIST). This investment builds directly on a stimulus program to develop applications which use advanced computers and communication networks to solve problems in health care, education, manufacturing, and more. For example, under a pilot test in Boston, a physician could transmit images (X-rays, CAT scans, photos) quickly to a specialist across town for immediate consultation. This program would be part of the multi-agency High Performance Computing and Communications program and would be coordinated by the Office of Science and Technology Policy's Federal Coordinating Council for Science, Engineering, and Technology (FCCSET). 1997 $320 million; four year total $784 million.

NASA/Civil aviation. The quality of the air transportation system has a direct impact on the quality of life of every U.S. citizen. This investment option would expand NASA aeronautics research in its support of the aviation industry and its enhancement of the safety and capacity of the national airspace system. One area for investment, advanced subsonics research, would focus on developing technology that would increase the competitiveness of U.S. commercial transport aircraft and enhance the safety and productivity of the national aviation system. The other area for investment, high-speed research, would focus on resolving critical environmental issues and establishing the technology base for an economical, supersonic aircraft. These investments will help counter aggressive government-supported foreign competition. In addition, it will provide technologies that improve the environmental compatibility of existing and future aircraft by reducing noise and engine emissions. Funding will reach an additional $222 billion in 1997, for a four year total increase of $550 million.

NASA/Short-haul aircraft research. This initiative will expand NASA aeronautics research to develop technologies for short-haul aviation. Short-haul aircraft includes commuter aircraft, rotorcraft, and general aviation airplanes. There are roughly 220,000 short-haul aircraft in the United States, making up 98 percent of the total civil aviation fleet. To help bolster the competitive position of the U.S. short-haul industry, NASA would develop technologies for both rotary and fixed wing aircraft to enable a new mode of high utility, safe, fast, and direct transportation linking thousands of smaller communities. The program would take advantage of ongoing and new Federal Aviation Administration (FAA) and industry cooperation to accelerate application of these advanced technologies to U.S. aircraft and engine manufacturers. Estimated outlay increase: in 1997, $20 million; over four years, $50 million.

Greatly increase non-defense Cooperative Research and Development Agreements (CRADAs) at the national labs. Cooperative Research And Development Agreements (CRADAs) are one of the mechanisms by which the national laboratories can work with industry to transfer lab-developed technology and know-how to the private sector. The funds go to the labs to pay for their share of the jointly agreed-upon R&D in the CRADA. The laboratory work under each CRADA is proprietary to the private-sector partner, who also hold the patent rights to inventions made under the CRADA. The current funding for CRADAs to transfer technology developed by DOE non-defense programs is $9 million, but there is more demand from industry for assistance through CRADAs than can be funded with that amount of money. This investment initiative provides an additional $30 million in 1994 and $50 million per year over the baseline in 1995-97.

Modernizing Social Security Administration computer systems. The Social Security Administration (SSA) relies heavily on its information systems to provide services and pay benefits. To meet current and future demands, SSA and State Disability Determination Services (DDSs) must abandon their labor-intensive, paper-driven tradition and automate. The proposal would invest in the pilot tested Intelligent Workstations and Local Area Networks and (IWS/LAN), creating a standard, state-of-the-art, computing network for all of SSA and DDSs. The investment funding includes modular workstations, and design/site preparation/installation. Estimated cost: over four years $880 million; 1997 $245 million.

Modernize Internal Revenue Service. IRS currently processes tax returns using technology from the 1960s. These out-of-date systems result in long delays for taxpayers and extra costs for the Federal government. Tax Systems Modernization (TSM) represents IRS's effort to move to an up-to-date, automated approach to processing taxes. With TSM, tax returns will be processed and stored using modern technology. Tax returns will be available in electronic files instead of remote warehouses. As a result, IRS employees will be able to provide immediate responses to most taxpayer questions over the phone. TSM will enable IRS to reduce the risks and costs associated with operating their current systems while also improving their ability to serve the public in the administration of the nation's tax system into the 21st century. Estimated cost: over four years $1.8 billion; 1997 $0.7 billion.

Housing

These initiatives will help make housing more affordable, and streets and neighborhoods safer. In conjunction with other measures, they will also provide the help that the homeless need. By empowering our people, these measures will go far toward creating real choices for Americans at every income level and help them achieve the American dream.

HUD/Assist more households with housing subsidies. The Department of Housing and Urban Development currently provides housing subsidies to 4.7 million low-income and very-low-income households to overcome their housing problem. Nevertheless, an estimated 3.6 million families and elderly very-low-income renters still face severe housing problems because they either have a "worst case need" for housing with (1) rent that exceeds 50 percent of their income or (2) live in a severely substandard housing unit. Additional Federal investments are needed to eliminate these remaining very-low-income rental housing problems. This investment would substantially increase assistance through HOME grants and housing vouchers. HOME funds would double to the full amount authorized of $2.2 billion; housing vouchers would increase from nearly 40,000 annually in 1993 to 100,000 by 1998. Estimated investment: over four years $716 million; 1997 $422 million.

HUD/Supportive housing program. This investment is targeted towards the problem of homelessness. It increases funds for rehabilitation of housing that serves the homeless as well as other services which seek to address the root causes of homelessness. The $138 million increase in 1997 and $241 million over four years represents a doubling of the program.

HUD/Public housing operating subsidies. The rent paid by residents of public and Indian housing often does not cover the operating costs incurred by housing authorities. The Department of Housing and Urban Development's Payment for the Operation of Low-Income Housing program pays the housing authorities for those operating costs not covered by rental payments, thus permitting housing authorities to provide and maintain safe, sanitary and decent housing. This investment of an additional $121 million in 1997 and $206 million over four years, by meeting the estimated cost of providing quality public housing, will strengthen our nation's stock of public housing and enable the people who reside there to have decent shelter.

HUD/Preserving and renovating low-income rental housing. The Administration proposes to increase funding to repair and restore the nation's stock of assisted rental housing, most of which is 20 to 30 years old. Many units are in deteriorated buildings. Many operators of buildings are also financially troubled. In the worst cases, hundreds of project operators have defaulted on federally insured mortgages, turning HUD into the lender and, ultimately, the landlord-of-last-resort. Another 360,000 units of HUD-assisted low-income housing face a problem of a different sort. These properties are nearing the end of the long-term HUD subsidies that helped them to remain as low-income rental housing. Without additional Federal subsidies, some owners could convert these affordable rental units into luxury apartments or even condominiums, leaving their low-income tenants out in the cold. Congress created the Low-income housing preservation program in 1990 to provide landlords the necessary incentives and subsidies to preserve this federally subsidized low-income housing as affordable low-income housing. The Administration proposes increasing funding for this program to ensure that no existing tenant loses his or her housing benefits as a result of adverse landlord actions. The cost of this additional investment in preserving and renovating low-income rental housing will be $858 million over the next four years. For 1997, spending will total $384 million.

HUD/Community Development Block Grants (CDBG). Since 1974, the CDBG program has been an important source of flexible Federal aid to State and local governments. CDBG funds directly help fund local economic and community development projects that benefit low- and moderate-income residents in large cities and urban counties and smaller communities. The Administration's proposed investment would directly create more than 7,300 jobs over the next five years, with even more jobs being created indirectly in the local economy. Because communities can select eligible activities most appropriate to their local circumstances, this additional funding will help communities where they need it most. Total spending would increase $137 million in 1997 and $430 million between 1994 and 1998.

HUD/Crime in public housing. The Administration proposes an Urban Partnership Against Crime initiative to address the increase in gang- and drug-related crime activity in many public housing developments across the country. Crime has exacted a profound and intolerable toll on public housing residents. Living in a constant state of fear of physical harm, residents have been robbed of their sense of community and personal well-being. Meanwhile, they have witnessed an ever-increasing expenditure of scarce public resources on repairing the damage done by crime to the physical environments of these developments. This initiative, costing $138 million in 1997 and $312 million over four years, would allow the Department of Housing and Urban Development to work with public housing and other local officials in an intensive effort to reduce crime in public housing. It focuses resources on those developments with greatest need, and gives flexibility to local officials to develop solutions (like community policing, neighborhood watches, youth activities) to the problems of crime in their communities.

HUD/Restore dilapidated public housing. This investment would provide an additional $138 million in 1997 and $241 million over the next four years to rehabilitate and restore severely dilapidated public housing projects that today are not only uninhabitable, but also contribute to the economic and social problems of the surrounding neighborhoods. These economically viable public housing units would then provide, once again, decent, safe, and affordable housing for low-income renters.

Lifelong Learning

Becoming a productive member of the community requires certain basics: like a healthy, supportive childhood; safe, sound schools; a chance to serve your country; and the opportunity to be retrained for the challenges of today's global economy. The Administration's commitment to major investments in these kinds of "human capital" promises payoffs for the nation far beyond their original price.

HHS/Full funding of Head Start. Children who participate in Head Start do better in school and become more productive as adults. By giving them the caring, stimulating environment they need, Head Start programs enable at-risk children to become problem-solvers instead of problems. Thousands of parents and selected studies have testified to the program's success, but for years our government despite promises has failed to make Head Start available to all the children who need it. With this initiative, one of our country's most cost-effective programs will become far more widely available and help change countless lives. The Administration will increase funding for Head Start by $3.2 billion in 1997, $8 billion over four years, achieving full funding for an estimated 1.4 million eligible disadvantaged children by 1999.

USDA/Head Start-related child care feeding. Pay for meals at Head Start centers and serve them to the participants added by the Administration's Head Start initiative; $237 million in 1997; $590 million over four years.

HHS/Head Start related Medicaid. Fund new entrants in the Medicaid program resulting from Head Start expansion; $116 million in 1997, $275 million over four years.

USDA/Full funding of WIC program. If our nation is going to prosper, our children will have to grow up healthy, not hungry. This special supplemental food program for women, infants, and children (WIC), helps make sure they do. By the end of 1996, all eligible children ages 1 to 4, including some 2 million who were not served last year, can be assisted with the proposed investment of $1 billion in 1997, $2.6 billion over four years.

HHS/Parenting and family support. These initiatives stem from a simple reality: governments don't raise children; parents do. These proposals will empower parents with the skills and the tools they need to help raise their children. They will support disadvantaged parents, including activities to help them work with their children at home and parenting classes, with an investment of $500 million in 1997, $900 million over four years.

Department of Education/Reforms and initiatives. All American children need greater access to better education not just to make the American Dream more available, but to make the American economy more productive. These initiatives will provide $2.7 billion in 1997, $6.2 billion over four years, to support reforms and reauthorizations in elementary, secondary, and postsecondary education, including state and local systemic reforms, a new SAFE Schools program, student assistance program improvements, and support of Historically Black Colleges and Universities.

National Service. The national service initiative will help young people pay for college and other postsecondary education by serving their country. In conjunction with income-contingent loan repayment, which will help Americans take low-paying community service jobs and still pay off their student loans, the program will provide dramatic new opportunities to serve our country. Young people will meet pressing national needs in areas including education, public health, environmental protection, and public safety. In return for one or two years of service, they will be able to receive a significant educational benefit. As it enables Americans of all backgrounds to help themselves and their country at once, the initiative will reinvigorate American citizenship lifting our country up and bringing our people together. The Administration's commitment to a fully realized program of national service is behind its plan to invest $7.4 billion in the next four years, building from $389 million in budget authority in 1994 to $3.4 billion in 1997.

Labor/Dislocated workers program. Legislation will be proposed for a new program to replace and improve upon two existing programs to help workers who lose their jobs because of restructuring of their industries, international competition, or defense downsizing to secure rapid reemployment or train for new careers. The program will cost an additional $2 billion in 1997, $4.6 billion over four years.

Labor/Job Corps expansion. Provide resources to increase the size of the Job Corps program by 50 percent by 2001. This will increase the number of Job Corps participants to 104,000, from the current 70,000. Job Corps provides remedial education, occupational skills training, supportive and job placement services to severely disadvantaged youth in its network of 110 residential centers. The plan would finance 50 new residential centers. The 1997 cost is $202 million; the 1994-97 cost is $341 million.

Labor/Job Corps maintenance. Spend $50 million in 1997 and $105 million over four years to repair and renovate Job Corps' aging residential centers.

Labor/Summer youth employment and training program (SYETP). The SYETP offers economically disadvantaged youth age, 14 through 21, work experience in minimum wage jobs in public and nonprofit agencies during the summer months. This investment of $625 million in 1997 and $2.0 billion over four years would finance about 2 million additional summer youth jobs. The plan includes an enriched program of work experience, basic skills training, testing and counseling, and closer coordination with schools.

Labor/One-stop career shopping. This program would make it easier for adults seeking to change jobs or careers or upgrade their skills to obtain access to the confusing array of Federal programs and services by developing "one-stop shop" career centers. Over four years, the proposed investment is $900 million, $250 million of which is to be spent in 1997.

Labor and Education/Youth apprenticeship. This program would finance a nationwide system of school- and work-based learning programs for high school youth who do not plan to attend college, in order to reduce drop-out rates and help them make a successful transition to meaningful careers in technical occupations. The proposal provides $500 million in 1997, a total of $1.2 billion over four years.

Rewarding Work

Earned Income Tax Credit (EITC). In America, no one who works should have to raise a family in poverty. The EITC currently provides refundable tax credits to low-income working families with children. By expanding the EITC, we will assure that a family of four will not be forced to live in poverty, if one of the parents works full-time at a minimum wage job. The cost of the entire proposal is $6.7 billion in 1997 and $19.9 billion over four years.

Welfare Reform. Later this year, the Administration will present a comprehensive reform plan to end welfare as we know it. The President's plan will carry out his pledge that no one with a family who works full-time has to live in poverty, that parents who bring children into the world should be held accountable for raising them, and that welfare ought to be a second chance, not a way of life. The plan, coupled with the Earned Income Tax Credit, tougher child support enforcement to crack down on deadbeat parents, increased training, parenting, and family support for moving people from welfare to work, will move toward a time-limited system of welfare. This will give people on welfare the education and training they need for up to two years, but after that, require all those who can work to go to work.

Justice

Justice/Crime initiative. A comprehensive program to support and improve all aspects of the criminal justice system. The initiative includes: (1) a new Community Policing/"Cops on the Beat" grant program to localities to create safer streets and to community policing, thereby building a bond of trust between citizens and police so that they can work together to fight crime; (2) a new Police Corps program, to provide scholarships to would-be police officers in exchange for a commitment to service as a State or local police officer; (3) a Criminal Records Upgrade program to assist States in improving their criminal records infrastructure and link with the FBI's criminal information databases; (4) increased funds to meet costs associated with detaining and incarcerating the growing Federal prison population, which has resulted from increased arrests and the imposition of minimum mandatory sentences; and (5) increased funds for existing Federal law enforcement activities. The budget authority investment is $900 million in 1997, $2.8 billion over four years.

Equal Employment Opportunity Commission (EEOC)/Enforcement. Increase EEOC enforcement staff in field offices to provide full enforcement of the Americans With Disabilities Act and the Civil Rights Act of 1991. The proposed outlays are $18 million in 1997, $63 million over four years.

Health Care

HHS/AIDS, immunizations, NIH research, and other public health initiatives. This investment provides substantial new funding $3.4 billion in 1997 and $8.2 billion over four years for a number of public health initiatives including: (1) HIV/AIDS research; (2) research on women's health issues; (3) the President's plan for increasing childhood immunizations; (4) teen pregnancy programs, and (4) other efforts to promote public health.

HHS/Substance abuse prevention and treatment. Challenge grants to the States to create substance abuse treatment capacity where is it needed most and for hard-to-treat populations. It will serve 30,000 people in 1994 and more in years after. The outlays are $800 million in 1997, $1.5 billion over four years.

USDA/Food Safety and Inspection Service. Improve the existing meat and poultry inspection system by increasing the number of Food Safety and Inspection Service inspectors available in order to ensure that visibly diseased animals are not processed, slaughterhouses and processing plants are clean and follow safe food handling procedures, and plant employees follow proper hygiene. Food safety research would also be enhanced. This responds to a clear need for improvements, highlighted by the recent food poisoning outbreak in Washington State. The initiative adds 200 inspectors. The investment is $34 million in 1997, $111 million over four years, and it would create some 275 jobs in 1994.

Rural Health Initiative. This proposal provides grants and other assistance to small rural hospitals to upgrade needed services. Grants may be used to launch integrated health systems and telecommunications links for remote consultation and diagnosis in low manpower areas. Estimated $50 million in 1994.

VA/Medical care. This four-year investment provides a $2.5 billion increase over the baseline to ensure high quality health care for veterans by such measures as providing adequate staff levels to meet requirements on residency education programs and automating drug dispensing in VA hospitals.

HHS/Social Security Administration/Disability insurance processing. Increase resources for the processing of dramatically increased disability benefit claims by $200 million in 1995-98. This will cut down on the significant delays that have occurred in recent years and reverse the general decline in service.

HHS/Ryan White Act. HIV/AIDS is now the ninth leading cause of death overall. Currently, approximately 1 million people are infected with HIV in the U.S., and about 60,000 new AIDS cases are reported each year. The President has pledged to respond to this need by fully funding the Ryan White Act and increasing Federal support for HIV/AIDS prevention efforts. To begin fulfilling these pledges this year, this proposal would increase funding for grants authorized under the Ryan White Act by $120 million in 1994. The proposal includes additional funding of approximately $1 billion over the next four years.

State and Local Relief. Within the Health Care, Rewarding Work and Lifelong Learning investment packages, the Administration will design a program to offset the impact of refugees and undocumented residents on the budgets of State and local governments, including those in California, Texas and Florida.

Investment Package: Tax Incentives

We recognize that the only way to lay the foundation for renewed American prosperity is to spur investment. New investment will create jobs, putting people back to work today, and will provide the productive equipment that we need to compete in the global economy.

Our overall program consists of outlays for physical and human capital and investment tax incentives for the private sector. Outlays for physical capital will help rebuild the crumbling foundations of the United States, create millions of high-wage jobs, and smooth the transition from a defense to a commercial-based economy. Our program will concentrate on the transportation, environment, and communications infrastructure. The program of tax incentives will increase private investment over the long run. Like the outlay programs, these incentives are designed to increase investment in human and physical capital. These incentives will be particularly helpful to small business which generates the lion's share of jobs.

Permanent small business tax credit. As discussed in the stimulus package, the plan provides that small businesses will now be eligible for a permanent investment tax credit on their equipment. The credit will generally be 7 percent in 1993 and 1994, and 5 percent thereafter. Small businesses operate at the margin and need a permanent incentive to invest, grow and provide new employment opportunities.

Incentive for investment in small business. The program provides relief from the capital gains tax for investors in small businesses. This proposal will allow investors generally to exclude 50 percent of the gains earned from investment in the stock of a qualified small business (less than $25 million capitalization) when held at least 5 years. Furthermore, 50 percent of the excluded gain is not subject to taxation under the alternative minimum tax. The tax incentives will both stimulate job creation over the short-run and increase investment over the long-term.

Research and experimentation tax credit. The economic plan will permanently extend the research and experimentation credit. This will encourage firms to undertake the research necessary to develop the technological innovations required to increase the supply of good jobs.

Real estate. The plan also permanently extends both the low-income housing credit and mortgage revenue bond provisions. Doing so will provide a stimulus to increase the supply of housing for low-income families. In addition, the program modifies the passive loss rules for persons in certain real estate trades or businesses, relaxes restrictions on pension investments in real estate and extends the depreciable life of nonresidential real estate.

Enterprise zones. This part of the program authorizes the establishment of a number of enterprise zones. Businesses located in enterprise zones will be eligible for a wage credit for the hiring of enterprise zone residents and accelerated depreciation or expensing of investments in enterprise zone property. In addition, small businesses in qualifying economically distressed areas will be eligible to obtain low interest rate loans through tax-exempt financing even if the area is not selected as one of the zones. Combined with the other tax incentives and other non-tax initiatives targeted to urban areas, these benefits should help promote investment and job creation in these areas.

Simplifying and enhancing depreciation provisions for companies subject to the alternative minimum tax (AMT). As noted in the discussion of the stimulus package, the plan substantially enhances the investment incentives for taxpayers subject to the AMT and simplifies the AMT by using the shorter regular tax depreciable lives for minimum tax as well as regular tax purposes. Because they reduce the net cost of acquiring depreciable assets, this proposal will provide a lasting stimulus to investment for affected companies.

Targeted jobs tax credit; employer-provided educational assistance. The plan permanently extends these two provisions, thus providing an incentive for American businesses to continue to invest in human capital. The plan also expands the targeted jobs tax credit to include workers in an apprenticeship program. An educated workforce will be more productive and better able to adapt to the challenges of a modern information-based economy.

Health insurance deduction for the self-employed. The plan calls for an extension of the 25 percent deduction for health insurance premiums of the self-employed through the end of 1993. This will retain the current law tax treatment of these premiums for affected individuals until the Administration's comprehensive health care proposals are enacted.

Small issue bonds and high speed rail facilities. The ability to issue tax-exempt bonds for qualifying small businesses and certain farmers would be extended permanently under the plan. In addition, in order to promote the development of high speed rail facilities, tax-exempt bonds issued for that purpose will not be subject to the State private activity bond volume limitations.