November 30, 1982 EXTENSIONS OF REMARKS 28121 EXTENSIONS OF REMARKS ENTERPRISE ZONES: URBAN tant for the Congress to act as soon as namely to create jobs, spur private invest­ ECONOMIC REVITALIZATION possible. ment, and strengthen local economies. CFrom USA Today, November 19821 . In 1891, Lyman Abbott, writing in Dark­ ness and Daylight, a book describing urban HON. ROBERT GARCIA ENTERPRISE ZONES: RESTORING ECONOMIC conditions at the brink of a new century, VITALITY TO INNER-CITY AREAS OF NEW YORK asked: <By Robert Garcia> "What shall we do with our great cities? IN THE HOUSE OF REPRESENTATIVES . The history of urban development is the What will our great cities do with us? These Tuesday, November 30, 1982 history of opportunity development. This are the two problems which confront every seemingly simple principle lies at the base thoughtful American. For the question in­ .• .Mr. GARCIA. Mr. Speaker, for over of the reasons for the development of every volved in these two questions does not con­ 2 years, Congressman JACK KEMP and I great metropolis that has ever existed. The cern the city alone. The whole country is af­ have sponsored the urban enterprise factors comprising the opportunity develop­ fected, if indeed its character and history zone legislation. This desperately ment-a fortress location, an intellectu.al or are not determined by the constitution of its needed economic development legisla­ religious sanctuary, or a port location-have great cities. " tion has been designed to promote re­ changed, but the tenet of opportunity devel­ Nearly a century has not changed the opment has remained constant. timeliness of Abbott's remarks. What shall vitalization in distressed areas. Since their founding, American cities' op­ we do with our nation's cities, in order to re­ The current situation .in most Ameri­ portunity development has been based on store their vitality and diversity, and pro­ can inner-city areas is very grave, the principle of private sector development, mote the rejuvenation of all sectors of characterized not only by record num­ for it is only in the. private sector that any urban society? bers of small business bankruptcies lasting sense of accomplishment and belong­ I firmly believe that enterprise zones can and the highest unemployment rate in ing have occurred, and it is only in the pri­ play an important part. in helping to restore 50 years, but also by human suffering, vate sector that assets may be accumulated the threads of vigor and optimism to our and a city's and neighborhood's wealth cre­ urban fabric. However, no one, and certainly helplessness and deprivation. The re­ ated. The maintenance of a vigorous, pro­ not I, claims that enterprise zones will be duction in central-city e.conomic activi­ ductive private. economy is critical if our the remedy for all that ails urban America. ty has brought about a corresponding cities are to thrive. It is especially vital for They most definitely have not been devised deterioration of employment opportu­ the central-city poor, for a productive pri­ to replace existing vehicles of Federal assist­ nities for the people living in those vate sector represents the only institution in ance to distressed cities, and I have ada­ areas. Minorities, low-income persons society capable of permitting the poor to mantly opposed every effort to attach to escape their poverty. A weak private sector them suggested mandates for deregulation, and female headed households have simply does not offer them that opportuni.­ been particularly hard hit, since they subminimum wages, and elimination of ty. other vital Federal urban programs de­ are increasingly concentrated in such The notion of the proper role of the Fed­ signed to provide jobs, housing, and assist­ communities. Many inner-city areas eral government in encouraging, buttress­ ance for inner-city economic. revitalization. I are in the throes of continually wors­ ing, or reacting to private sector activities do not intend for this bill to stand alone. I ening economies, because of business leading to opportunity development has do intend for the enterprise zone program, been debated since the launching of our fed­ concomitantly with Urban Development disinvestment. eralist system. Whatever the ideological or The Federal Government must pro­ partisan persuasion, however, it can irref­ Action Grants, the Economic Development vide for the reestablishment of oppor­ Administration, job training, and other pro­ utably be stated that, to the extent that a grams, to provide a mechanism for the tunity producing incentives in areas government program increases the opportu­ useful, flexible, and cre.ative reinvolvement where they no longer exist, but once nities of some or all citizens without corre­ of the private sector in such areas to bring did. Such incentives, as contained in spondingly decreasing the opportunities of about economic regeneration. any citizens, that program has provided us the enterprise zone legislation, should CENTRAL CITIES TODAY serve to attract businesses to neigh­ with an example of the proper role of gov­ ernment in bringing about American urban The current situation in most American borhood areas which face severe de­ development. inner-city areas is very grave, characterized pression, unemployment, and poverty. The enterprise zone proposal that I have not only by record numbers of small busi­ The incentives should also be designed developed, along with Congressman Jack ness bankruptcies and the highest unem­ to aid existing firms to expand as part Kemp CR.-N.Y.), is designed to use the vital­ ployment rate in 50 years, but also human of a larger strategy to restore econom­ ity of the Federal tax code as an incentive suffering, hopelessness, and deprivation. A ic vitality to our inner cities. However, for cities to assist in the creative regenera­ description of the current urban situation let me say now that the zones cannot .tion of poor urban neighborhoods, and to do will dramatically illustrate the need for a so in ways that will benefit the very people continued strong Federal role in local eco­ work alone and indeed will need the who now dwell in those neighborhoods. En­ nomic development, which includes retain­ continued support of other Federal terprise zones will, in short, enhance and ing and. strengthening existing assistance programs including job training ef­ expand the opportunities for individual and mechanisms, and formulating new ones, forts such as Job Training Partnership institutional economic opportunity develop- such as the enterprise zone program. _ Act recently passed by this Congress. ment. · Declining local economies: Many inner­ For the benefit of my colleagues, I The program will be discussed in detail city areas are in the throes of continually have included an article that I wrote later in this article. To initially describe the worsening economies, because of business concept though, specified zones will be se­ disinvestment. Many of these areas are de­ earlier this year and appears in this lected and identified by their high incidence pendent on economic sectors such as manu­ month's edition of USA Today maga­ of poverty, unemployment, and general del­ facturing, which are declining nationwide. zine highlighting the desperate need eterious conditions. Various tax incentives They have been unable to attract newer in­ for and the major provisions of the en­ will be offered to encourage new business to dustries, or secure the expansion or prevent terprise zone proposal. locate and grow in distressed inner-city the demise of existing businesses. It is my hope that we can move this neighborhoods, and hire and train economi­ Unemployment: The reduction in central­ legislation in the days ahead. It does cally disadvantaged individuals. Local and city economic activity has brought about a state governments will be required to offer corresponding deterioration of employment need some modifications such as a incentives of their own, such as improved opportunities for the people living in those startup capital provision to assist new municipal services or rehabilitation of infra­ areas. Minorities, low-income persons, and and expanding businesses. However, as structure, in order to contribute to the suc­ female-headed households have been par­ one more tool for local officials to cess of the zones. The enterprise zone pro­ ticularly hard hit, since they are increasing­ combat economic decay, it is impor- gram has clear and fundamental purposes, ly concentrated in such communities. .e .This "bullet" symbol identifies statements or insertions which are not spoken by the Member on the floor. 28122 .EXTENSIONS OF REMARKS November 30, 1982 In April, 1982, the national unemploy­ for all of this. Such conditions require a Enterprise zones will provide such incen­ ment rate hit 9.4 percent, the highest level whole battery of economic development tives for entrepreneurs to return to previ­ since the Great Depression. This figure, tools-grants, loans, incentives, and other ously shunned areas and contribute to the however, belies the unemployment crisis in assistance-to com.bat them. The targeted restoration of viable and self-sufficient inner-city areas. During this same month, tax incentives of the enterprise zone pro­ urban neighborhood economies. The wealth the unemployment rate in New York City gram promise to be a useful addition to ex­ of the community would once again have an approached 10 percent-representing hun­ isting development programs. opportunity to be retained in the neighbor­ dreds of thousands of persons looking for THE KEY TO URBAN RECOVERY hoods, providing a strong base for the entire work, but unable to find it. In my South city. In recent years, the private sector-fre­ Bronx Congressional district, it was conserv­ In its final report in 1980, the President's quently with Federal assistance or as a atively estimated that the rate hit 30 per­ Commission on Neighborhoods emphasized result of Federal actions-has compounded cent.