Legislation Enacted


Empowerment Zones and Enterprise Communities -- The Omnibus

Reconciliation Act of 1993 (P.L. 103-66) includes a new grant program

under Title XX of the Social Security Act for the establishment of

empowerment zones and enterprise communities. This initiative is

designed to revitalize communities through both economic and human

development using bottom up (community level) comprehensive and

collaborative strategic planning. Grants and tax incentives will be

provided to 105 communities (9 empowerment zones and 95 enterprise

communities) in urban and rural areas who demonstrate economic

distress. By a Presidential Directive issued September 9, 1993, the

President established an interagency Community Enterprise Board,

chaired by the Vice President, to oversee the initiative. Through

this board, for which the President's Assistants for economic and

domestic policy serve as vice-chairs and heads of key Federal

Departments serve as members, communities will be given broad

flexibility and assistance in coordinating and integrating services

in the target areas.

The Goals 2000: Educate America Act --

Goals 2000, P.L. 103-227, has been established to improve learning

and teaching by providing a national framework for education reform;

to promote the research, consensus building, and systemic changes

needed to ensure equitable educational opportunities and high levels

of educational achievement for all students; to provide a framework

for reauthorization of all Federal education programs; and, to

promote the development and adoption of a voluntary national system

of skill standards and certifications, as well as for other purposes.

The Act contains measures for systemic educational reform using both

top-down and bottoms-up strategies. State and local educational

agencies are encouraged to develop comprehensive improvement plans

that will provide a coherent framework for the implementation of

reauthorized Federal education and related programs in an integrated

fashion. States may receive an allotment of funds for systemic

improvement efforts and must submit a State Improvement Plan after

its first year of funding. The Secretary has been given authority to

waive Federal statutory and regulatory requirements to enhance

flexibility in the implementation of systemic improvement plans.

In addition, Goals 2000 establishes six flexibility demonstration

projects under the "Education Flexibility Partnership Demonstration

Act". Under this demonstration, States can apply for designation as

one of the six "Ed-Flex Partnership States" which would give them the

authority to waiver any statutory or regulatory requirement

applicable to any program or Act as described in the law without

seeking approval from the Department of Education. States will be

eligible for designation if they have prepared an improvement plan,

have waived State statutory and regulatory requirements for the local

authorities within the demonstration area, and have established

performance measures for ensuring accountability to outcomes in the

improvement plans.

Resource Conservation and Recovery Act Strategic Management Framework

(RCRA) -- EPA's RCRA governs the disposal of solid waste. Beginning

in 1992, the RCRA program established a flexible process for

allocating RCRA permitting funds. States and EPA prioritize among

the facilities that they want to permit using a numerical ranking

system called the Priority Ranking System. If certain facilities of

concern to the state do not fall within the high-priority ranking,

states have the option of "bumping them up" by demonstrating that

permitting these facilities would be of considerable environmental

benefit such as providing new capacity or demonstrating a new

technology, cross- media approach, or waste minimization method. An

additional 15% of all state facilities may be moved into the high-

priority rank if they are of particular concern to the public or the

state. The RCRA enforcement program uses a similarly flexible

program called RIP FLEX (RCRA Implementation Plan Flexibility).

Job Training Partnership Act (JTPA) Amendments --

These amendments give states discretion to establish State Human

Resource Investment Councils (HRIC) to coordinate Federal human

resource assistance programs. The amendments also create a new

youth-focused title (Title IIC) that enhances state flexibility and

encourages greater state innovation to find effective ways to

increase youth employment and earnings.

Mickey Leland Hunger Prevention Act --

This bill contained several provisions to improve the conformity of

certain Food Stamp Program rules with Aid to Families with Dependent

Children Program rules. These provisions were to:

o Exclude non-title IV educational assistance.

o Exclude from income determination up to $50 in child

support for all FSP households.

o Increase the Employment and Training Program (E&T)

dependent care reimbursement limits to $200 for children under age 2

and $175 for all other children.

o Increase the dependent care deduction caps to $200 for

children under age 2 and $175 for all other dependents.

o Allow States the option to increase the E&T participant

reimbursement cap for expenses other than dependent care above a

minimum of $25.

Congress enacted the Mickey Leland Childhood Hunger Relief Act. The

Act adopted the Mickey Leland Hunger Prevention Act provisions to

increase the E&T dependent care reimbursement limits and dependent

care deduction caps.

Childhood Immunization --

Enacted in 1993, the President's Vaccines for Children program, which

guarantees low-income children access to free immunizations against

preventable diseases, gives states the flexibility and responsibility

for managing vaccine purchases and distribution, recruiting

providers, enhancing the immunization infrastructure, and

implementing outreach strategies.

Family Preservation and Support Act --

The Family Preservation and Support Program will provide

approximately $1 billion to states over the next five years to

provide services to families in efforts to keep families intact. HHS

is implementing the new program to provide maximum flexibility to

states and local communities in how they design and carry out family

preservation activities. HHS has been collaborating with State

officials on the Federal guidance for this program.

Intermodal Surface Transportation Efficiency Act (ISTEA) --

ISTEA has provided local and State decisionmakers with unprecedented

flexibility in the development of transportation investment

strategies which meet both regional and community goals and

objectives. Based upon the needs identified through ISTEA's

enhanced, multimodal transportation planning process, State and local

authorities may now 1) use certain highway funds for appropriate

transit purposes, and vice versa; 2) fund non- traditional

"enhancement" projects such as pedestrian and bicycle facilities, the

preservation of historic areas and buildings; and 3) through the $6

billion Congestion Mitigation and Air Quality Improvement program,

develop projects and programs which reduce transportation-borne

pollutants and provide relief to congested roads and highways. Since

ISTEA became effective, the States have obligated over $954 million

flexibly, that is, transferring highway dollars to transit.

Furthermore, ISTEA fosters economic and community development by

requiring that land-use, social equity, and environmental concerns be

incorporated into the transportation planning process and that the

general public have a much stronger voice in transportation

investment decisionmaking.

The HUD Demonstration Act (P.L. 103-120) --

This Act authorized three program initiatives that will test new ways

of providing affordable housing and rebuilding our communities. They

include the National Community Development Initiative, the Innovative

Homeless Fund, and Pension Fund Leveraging.


The National Community Development Initiative has been instrumental

in increasing the capacity and reach of community development

corporations (CDCs) which today develop and manage a significant

portion of the low-cost housing portfolio. HUD's investment of $20

million matches $66 million in philanthropic

funds, all of which, in turn, is leveraged at the local level to

support housing and community development.

Innovative Homeless Fund --

Congress appropriated $100 million for the Innovative Homeless Fund.

This highly flexible fund will permit HUD to undertake comprehensive

initiatives with cities that commit to addressing the full continuum

of care.

Pension Fund Leveraging --

Congress appropriated $100 million to the Community Investment

Demonstration project to foster affordable housing partnerships with

the AFL-CIO and other pension funds, leveraging billions of dollars

in private investment.

Unemployment Insurance Flexibility --

NAFTA legislation gives states the option to establish self-

employment assistance programs as part of the State UI system.

The Human Services Amendments of 1994, P.L. 103-252, signed by the

President on May 18, 1994, created the Community-Based Family

Resource Program by consolidating four HHS programs: the Family

Resource and Support Program; Emergency Child Protective Services

Grants; the Child Abuse Community-Based Prevention Program; and the

Child Abuse Prevention and Treatment Act (CAPTA). The purpose of the

new consolidated program is to assist each state to develop and

implement, or expand and enhance, a comprehensive, statewide system

of family resource services through collaboration with existing

education, vocational rehabilitation, health, mental health,

employment and training, child welfare, and other social services

agencies within the state.

Regulatory Changes


User Fees for Export Certification --

In July 1993, the Animal and Plant Health Inspection Service (APHIS)

at USDA amended regulations to provide an alternative method of

calculating the fees States may charge when they issue Federal

phytosanitary certificates. Now, states may calculate fees on a

"cost-per- certificate" or "cost-per-hour" basis.

Postentry Quarantine --

In July of 1993, the Animal and Plant Health Inspection Service

(APHIS) at USDA amended regulations requiring postentry quarantine

for certain imported plants. The amended regulations limit the

importation of some plants unless they are destined for States that

have signed an agreement with APHIS to inspect and monitor postentry

quarantine sites and to supervise and enforce importer compliance

with postentry quarantine requirements. APHIS made several changes

to the proposed rule to more clearly recognize State enforcement


Rural Business Enterprise Grant --

Noting that small, rural businesses require technical assistance as

well as capital to start or keep the enterprise viable, the Rural

Development Administration at USDA responded by changing regulations

in the Rural Business Enterprise Grant to allow recipients to use a

large portion of the grant on technical assistance.

Changes to WIC Regulations --

The Food and Nutrition Service (FNS) at USDA increased flexibility to

States through numerous regulations.

o FNS published a Women Infant and Children (WIC) regulation

giving additional flexibility to States in mailing food instruments

to WIC participants.

o FNS published a WIC regulation permitting recipients of

Medicaid, Food Stamps, and Aid to Families with Dependent Children

(AFDC) to be deemed automatically income eligible for WIC.

o FNS published a WIC regulation permitting an individual to

be deemed automatically income eligible for WIC if a family member

receives Medicaid, Food Stamps, or AFDC.

o FNS published a WIC regulation giving additional

flexibility to States in documenting nutrition education contacts to


Also, FNS issued a formal instruction permitting additional

flexibility to States for use of WIC funds to purchase, renovate, and

repair WIC clinic facilities.

Commodity Distribution Reform Final Regulations --

The Food and Nutrition Service (FNS) at USDA has adopted regulations

that provide states and local areas flexibility in three ways:

o Accommodate State computer systems by allowing several

options for selecting commodity value;

o Permit States to make less frequent than monthly commodity

deliveries to local organizations when requested; and

o Extend the time frame for States to report commodity losses

to FNS.

Meal Supplements Regulation --

This regulation authorizes reimbursement under the National School

Lunch program for meal supplements served in after-school care

programs operated by schools that were participating in the Child and

Adult Care Food Program as of May 15, 1989.

The Food Stamp Program Management Evaluation System --

In 1993, the Food and Nutrition Service at USDA significantly changed

the Food Stamp Program Management Evaluation System to give greater

flexibility to State agencies. Previously, the National Office

established priority areas for the Food Stamp Program and mandated

that these areas be included in the States' reviews of local office

operations. In 1993, the National Office listed National areas of

concern and each State agency was given the opportunity to work with

the FNS Regional Office to select those areas that were appropriate

for review in each individual State.

Revamped Commodity Allocation Procedures --

The Food and Nutrition Service at USDA has revamped commodity

allocation procedures in The Emergency Food Assistance Program to

permit States to select those products which best serve their needs.

Consolidation of Talmadge-Aiken and Cross Utilization Inspection

Programs -- The Food Safety and Inspection Service (FSIS) at USDA has

allowed State agencies that participated in the Cooperative

Inspection Program and that dedicated less than 10 staff years to

Federal inplant inspection to convert their Talmadge-Aiken program to

a Cross Utilization Program. Those State agencies that have

converted will administer only one of these programs instead of two.

Legislative Proposals


HR 820, National Competitiveness Act of 1994 --

The National Competiveness Act of 1994 passed by the Senate (as S4)

on March 16, 1994, waiting for conferees to be named. Includes (as

Title XI) the "Local Empowerment and Flexibility Act of 1994" This

legislation establishes a pilot program (maximum of 30 communities in

maximum of 6 states) to empower and provide communities the

flexibility to integrate programs and program funds across existing

Federal assistance categories. Localities must develop a local

flexibility plan which includes, among other things, specific goals

and measurable performance and a system for the comprehensive

evaluation of the impact of the plan on the participants, the


Board authority to waive any requirements applicable under Federal

law necessary for the implementation of local flexibility plans.

Conferees have been named in the Senate but have not yet been named

in the House.

Department of Education Report to Congress --

The Department of Education submitted a report to the House

Appropriations Committee in response to a request that the Department

review the feasibility of consolidating programs which serve the same

populations and are directed toward the same outcomes. The

report and recommendations are to be considered in the context of

Congressional Action on legislative proposals (described below) and

the FY 1995 budget.

The Improving America's Schools Act --

This reauthorization proposal provided DoEd the opportunity to weigh

the benefits of continuing its elementary and secondary programs and

to propose consolidation and termination where appropriate. The Act

proposes to: consolidate the National Diffusion Network and the

various technical assistance centers in elementary and secondary

education into a single network of ten regional centers; consolidate

the Eisenhower Mathematics and Science Education program and the

Chapter 2 State Grants program into the Eisenhower Professional

Development program; consolidate the Drug-Free Schools and

Communities Act and the Safe Schools Act into a Safe and Drug-Free

Schools program; and, consolidate the current Immigrant Education

program into the Bilingual Education authority which would create a

targeted discretionary grant program for school districts heavily

affected by immigration instead of the current formula grant program.

The reauthorization of Improving America's Schools Act of 1992 is

also calling for the discontinuation of a list of the elementary and

secondary programs mentioned in the NPR report, including Education

for Native Hawaiians, Foreign Languages Assistance, Territorial

Teacher Training, Ellender fellowships, the FIRST program,

Educational Partnerships, General Assistance to the Virgin Islands,

Law-Related Education, Dropout Prevention Demonstrations, Civics

Education, and the payments made under sections 2, 3(b), and 3(e) of

the P.L. 81-874, the Impact Aid maintenance and operations statute.

In addition, a number of other funded and unfunded program

authorizations would also be terminated. Authority to carry

activities in areas now funded under certain of these programs, such

as foreign languages education and school recognition, would be

included in the authorization for the Fund for the Improvement of

Education, a broad discretionary program.

This bill also includes additional provisions that would allow

consolidated activities. For example, it would allow both state and

local educational agencies to submit consolidated plans -- rather

than a separate plan for each program -- in order to present a

single, comprehensive strategy for moving the state or community

toward achievement of the National Education Goals.

In addition, the bill would permit Title I schoolwide programs to

incorporate funding from other programs, so that children attending

high-poverty schools can benefit from a cohesive educational program

rather than receiving separate, often disconnected, categorical


School-to-Work Opportunities Act --

As proposed to Congress, this joint initiative of the Departments of

Labor and Education gives broad discretion in planning and

implementing state-wide school- to-work transition systems. DOL, in

coordination with DoEd, has awarded grants to each State to develop

plans for bridging the gap between efforts of the State and local

entities to provide services to youth in their transition school to


The Reemployment Act --

As part of the FY 95 budget, DOL has proposed a new Workforce

Security Act that will combine and expand six DOL programs for

dislocated workers. The expansion dollars are based on savings from

the elimination of several programs proven ineffective.

Worker Adjustment Career Centers (WACC) and One-stop Career Centers -

- As proposed in the Reemployment Act, states would have the

discretion to designate the number of WACC and One-stop career

centers and the geographic areas they cover in the state. In the

case of One-stop career centers, states have the discretion to

determine what programs in addition to JTPA programs will be included

under the one-stop umbrella. States also have the option of

providing dislocated worker services through WACCs or One-stop Career


Health Care Reform --

Under the President's health care reform proposal, the Health

Security Act, states will play a crucial role in assuring quality

health services for all Americans. Within a broad federal framework,

states will have substantial flexibility to design and implement

their overall health care strategy; establish health alliances;

certify accountable health plans; monitor the quality of and access

to care; implement insurance and malpractice reforms; and design and

administer a home and community-based long-term care program. The

Health Security Act would also provide federal assistance to states

in restructuring their public health systems.

HUD's 1994 Legislation and FY 1995 Budget --

This proposed legislation and budget will dramatically transform the

way key departmental programs are authorized and administered.

HUD is the locus of the Federal Government's efforts to reduce

homelessness. A reorganized McKinney program will provide a

"continuum of care" for homeless persons through coordinated grants,

rental assistance and a food and shelter program.

The Department has begun an intensive effort to redesign the Nation's

most distressed public housing. Public housing modernization and

revitalization of distressed public housing programs will be

restructured to give public housing authorities greater flexibility

to use Federal funds and greater ability to leverage other public-

and private-sector resources in support of their goals.

HUD's community empowerment programs were redesigned to provide the

flexibility necessary to address local needs and provide others the

tools and resources they need to carry out their strategies.

Community Development Block Grant (CDBG) remains the most flexible

community-building tool. The President's Empowerment Zone Initiative

will provide grants for a range of activities at local discretion.

The Neighborhood LIFT Initiative is a new project-based grant-loan

program to promote and leverage private investment in retail,

commercial, or mixed-use development projects in distressed areas.

The Community Viability Fund is a new flexible fund designed to build

the organizational capacity of community-based groups and

institutions to conduct strategic planning and support the design and

development of public amenities.

National Transportation System --

The Department of Transportation has formulated the National

Transportation System, a planning device that will emphasize the

interconnectedness of the Nation's transportation facilities. An

illustration of how this will work is found in the Department's

proposed reauthorization of the Federal Aviation Administration's

programs. In this reauthorization, DOT has proposed a more flexible

approach to integrated airport system planning. This approach will

allow regional planning organizations to consider non-airport

components of the transportation system, provided

that airport users would benefit from these components.

The Department of Transportation has also proposed to eliminate grant

programs for rail freight and for boating safety.

Pilot Projects and Waivers


Multi-year Grant Pilots -- EPA has awarded two multi-year pilot

projects for the water quality program whereby states receive waivers

from the regulatory requirement to submit annual grant applications.

The intent is to streamline the grants process and reduce the

administrative burden on the States. As part of the pilots, EPA

prepares a two-year program guidance, State and Federal program

managers have face-to-face negotiations, and a conflict resolution

process is established.

Plant Protection and Quarantine Service --

In August 1993, the Animal and Plant Health Inspection Service

(APHIS) at USDA established a reinvention laboratory to enhance plant

protection and quarantine service delivery through decentralization

in the Southeastern Region of the United States. The project

involves eliminating the Assistant Regional Director layer of

hierarchy and empowering State Plant Health Directors to carry out

their functions in the most effective manner. Elements of the lab

include involving State and local officials in the planning and

evaluation of programs and integrating selected State and Federal


Employment and Training Cooperative Agreements --

USDA has entered into cooperative agreements with five State agencies

to test improved conformance between the Food Stamp Employment and

Training Program (E&T) and the Job Opportunities and Basic Skills

Program for AFDC participants. It is hoped that the project will

improve consistency and cooperation among employment and training

programs, reduce costs, eliminate barriers to appropriate services,

and enhance current E&T activities. The demonstrations will operate

for up to four years.

Distance Learning and Medical Link Program and Economic Development

Grants -- The Rural Electrification Administration (REA) at USDA has

two grant programs. One grant program, the Distance Learning and

Medical Link projects, brings medical and educational services to

rural areas through telecommunications. The other grant program,

Economic Development Grants, provides revolving funds for local rural

economic development projects. Both programs encourage applicants to

combine these grants with other funding programs by giving priority

consideration points for such combining.

The Food Stamp Program Waivers --

The Food Stamp Program (FSP) at USDA approved 153 waiver requests in

FY 1993. The waivers provide State agencies with greater flexibility

in administering the program. Waivers were approved in such areas as

recertification, length of certification periods, interview

requirements, issuance, quality control procedures, and application

requirements. The FSP also has granted a waiver in the area of

nutrition education that would allow Federal match of alternate

funding sources that will enhance the State agencies efforts at

developing nutrition education plans. In addition, the FSP approved

waivers for the New York, Oregon, and Arkansas State agencies

allowing them to implement a new type of reporting system known as

quarterly reporting. Under quarterly reporting, participating

households report changes in their circumstances on a quarterly

basis. The new reporting system helps to alleviate State agencies'

workloads while also insuring that they have accurate information

about their caseloads.

Food Stamp Waivers --

In the past year, USDA has approved Food Stamp waivers as part of

welfare reform demonstrations in l3 States. The waivers enable

states to coordinate their experimentation with the policies of both

AFDC and Food Stamps. Approved waivers affect income disregards,

resource exclusions, and the cashing out of food stamp benefits.

The Goals 2000: Educate America Act, the Improving America's Schools

Act, and the School-to-Work Act all contain provisions to permit

States and localities to obtain waivers from Federal statutory and

regulatory requirements where they can show that those requirements

impede the education reform process and when they have a plan in

place for achieving better educational outcomes for all students.

Statewide Health Reform Experiments --

HHS has approved waivers allowing five states to conduct major

statewide experiments, including OR, HI, RI, TN, and KY.

Medicaid Program Waivers for Home and Community Based services (HCBS)

and Freedom of Choice (FOC) programs in HHS --

HCBS waivers permit states to expand non-institutional long-term care

services to Medicaid recipients. FOC waivers enhance states' ability

to implement managed care programs and has made special efforts to

assist states which have not had substantial experience with managed

care. HHS is working with The National Governors' Association to

strengthen these waiver processes.

State Welfare Reform Experiments --

HHS has approved numerous welfare waiver packages that provide

considerable flexibility to states in designing welfare demonstration

projects. HHS has approved 7 state packages in 1993 with several

more expected to be approved in 1994.

Public Health Service Research Demonstration for Community Services

Network --

HHS' PHS is conducting a demonstration project through the Office of

Disease Prevention and Health Promotion for the purpose of learning

how contemporary computer and communication technologies can support

and enhance the coordination of health and human services at the

community level. Called the Community Services Workstation, the

project is underway in D.C. to test the use of advanced information

technology as a tool to assist community-level collaboration.

HOPE 6 --

Hope 6 or the Urban Revitalization Demonstration Program (URD) was

created for the purpose of revitalizing severely distressed or

obsolete public housing developments in the 40 most populous U.S.

cities. The program allows the flexibility to provide complex

packages of physical improvements and supportive services. Resources

will be available to provide job-training, literacy training, day

care, youth activities, health services, community policing and drug

treatment. Participating housing authorities must also establish a

community service program, such as youth conservation corps or

school-based service programs like literacy training. Housing

authorities were given the greatest degree to flexibility to redesign

distressed developments, by seeking participation from local and

State governments, neighborhood organizations, businesses, non-

profits, social service providers and residents.

Comprehensive Cities Program --

In FY 1994, the Department of Justice will initiate a comprehensive

crime control/community mobilization program in five or six cities

across the country that will involve comprehensive planning and

improved intergovernmental relationships. Under this program, cities

faced with high rates of drug and violent crime will develop a

comprehensive strategy for crime and drug-control which requires the

police and other city agencies to work in partnership with the

community to address crime and violence-related problems and the

environment which fosters them. Each strategy must include a

jurisdiction-wide commitment to community policing, coordination

among public and private agencies, and efforts to encourage citizens

to take an active role in problem solving.

Reinvention Activities in Atlanta, GA--

The Atlanta Federal Executive Board, in cooperation with the regional

Social Security Office, the National Treasury Employees Union,

Georgia Department of HHS, Georgia State University, and the Atlanta

Project is implementing a pilot project for a common access

application for AFDC, Food Stamps, WIC, Medicaid, SSI and Housing

Assistance. The application will eliminate the collection of

unnecessary information and allow the agency "intake" worker to make

the eligibility determination without additional interviews. This

initiative will provide one-stop customer service and reduce the

paper application from more than 50 pages to 8. The pilot will be

introduced in a local community center with staff from the Atlanta

Project and volunteers trained to assist all applicants in completing

the form and explaining the programs for which they qualify. A

customer survey will be conducted at the end of March to determine

customer satisfaction and agency efficiency with

this one-stop shopping program. Future plans are for the common

access application forms to be available in all community centers as

well as offices of each of the participating agencies.

The Alamo Federal Executive Board Reinvention Lab --

The FEB for San Antonio, TX has been designated as a reinvention lab

to highlight and assist their efforts to facilitate cooperation among

federal and local government agencies. The Alamo FEB is working to

remove unnecessary regulations and red tape and to improve internal

operations so that intergovernmental employees may work together as

partners to create flexibility and to solve problems in the


Federal Highway Administration --

DOT's Federal Highway Administration has successfully tested the use

of an electronic signature to speed part of its grant delivery

process and is expanding the program to additional phases of grant

delivery and to all the administrative processes for opportunities to

eliminate and modify current requirements.

Advisory Commission on Intergovernmental Relations (ACIR) ISTEA study

-- The Department of Transportation (Federal Highway Administration)

is working with ACIR to perform case studies of approximately 12

Metropolitan Planning Organizations (MPOs) to be completed by

December 1994 with conclusions about the capacity of MPOs to carry

out the expanded responsibilities given to them by ISTEA.

ACIR's Study on the Impacts of Federal Mandates and Regulations on

Effective Schools --

The Department of Education has funded ACIR to conduct a study in

four States on the positive and negative impacts of federal mandates

and regulations on the institutionalization of the factors commonly

associated with effective schools.

California Earthquake Relief --

The Department of Transportation initiated many actions to cut red

tape and provided regulatory relief for the California Earthquake

recovery effort. A supplemental appropriation of $1.35 billion was

requested for the emergency relief program for federal aid highways.

The request included language to waive the current legislative cap of

$100 million per State per emergency, clarify that all costs incurred

during the first 180 days are federally funded, and give the DOT

Secretary and EPA Administrator authority to waive environmental laws

and regulations as needed to facilitate project reconstruction.

In addition, Federal Highway Administration (FHWA) immediately

approved nine contracts totalling $4.1 million for demolition and

shoring of damaged highway structures. The first contracts were

placed 16 hours after the earthquake occurred. FHWA also

approved a variety of innovative techniques to "shortcut" the normal

contracting process, thus expediting restoration of the

transportation system.

Also, FHWA issued an emergency declaration relieving motor carriers

who provided direct assistance to the earthquake effort of certain

Federal regulations on driver hours of service. Another DOT agency,

the Federal Railroad Administration, granted a waiver of safety

regulations for 32 Canadian passenger cares from Toronto's transit

system to supplement capacity on the Los Angeles Metrolink commuter

rail system. Certain passenger car construction standards differ

between the U.S. and Canada which, without waivers, would have

prevented even temporary operation in California.

Forest Service --

The Forest Service at USDA has allowed its State and Private Programs

area to allow state agencies to consolidate annual programs into one

cooperative agreement or grant and to receive consolidated payments.

The Rural Development Administration (RA) --

RA and the National Rural Development Partnership (NRDP) at USDA have

undertaken several efforts to be more flexible and responsive to the

needs of rural communities across the United States.

o Noting that rural entrepreneurs seeking federal and state

assistance for small businesses faced a mountain of forms asking for

similar information, the Kansas State Rural Development Council of

the NRDP worked together with federal and state agencies to a create

a single loan application.

o Frustrated local development officials complained that the audit

costs for modest-sized loans received from RA Community Facility were

too high, the South Dakota State Rural Development Council asked RA

for relief. RA responded and waived audit requirements on smaller

loans, saving rural communities $400 million nationwide.

Inter-Agency Action


Employment and Training Administration (ETA) --

DOL's ETA has accomplished and embarked on a number of joint funding

efforts with several Federal agencies to eliminate duplication of

efforts thereby increasing the availability of resources to States

through single funding actions. Where legislation provided

flexibility in the award of certain grants, ETA was instrumental in

working jointly with the Departments of Education, Justice, Defense,

HUD and Transportation in the planning, funding and award of grants

to state and local entities. Specific examples include Defense

Conversion, Skill Standards, Youth Fair Chance, and School-to-Work


Defense Conversion --

DOL works with DOD in awarding grants to areas with significant

numbers of base closures. These grants are designed to provide

retraining and/or employment services to individuals displaced as a

result of these base closings. Through coordination efforts, DOL and

DOD have eliminated the requirement for grantees to report to both

departments on performance activity.

Pacific Northwest Economic Adjustment and Community Assistance

Response -- The Rural Development Administration (RA) at USDA played

a major role in preparing the Pacific Northwest Economic Adjustment

and Community Assistance Response, a step that became necessary as a

result of Federal action to curtail harvesting of old-growth timber

in certain areas of the Pacific Northwest. Eleven federal

departments and agencies, including the White House, are involved in

the public/private sector effort to develop a financial plan to

respond to the economic diversification needs of the region.

The Defense Automation Resources Information Center has a

redistribution and sharing program which allows local schools (both

public and private) and community non-profit organizations to get

excess information processing and computing equipment from military

bases under streamlined excess property procedures. These programs

include a primary and secondary school donation program and a support

program to lease excess computing gear, at no cost, to historically

black colleges and universities and minority institutions.

In April of 1993, DoEd and HHS jointly developed and published

Together We Can: A Guide for Crafting a Profamily System of Education

and Human Services. This was developed to help communities improve

coordination of education, health and human services for at-risk

children and families.

Fair Lending Task Force --

HUD, DOJ, the Comptroller of the Currency and seven other agencies

forged an historic cooperative relationship to bring the resources

and powers of all three agencies to bear on ending mortgage lending

discrimination. For the first time, joint investigation and

enforcement efforts will be undertaken and information will be


Funding Flexibility


FEMA's Reorganization of Program and Budget Structure --

FEMA was reorganized from a programmatic to a functionally based

structure in November of 1993. This functional structure was

designed to streamline the process for FEMA's goal of customer-

oriented service to the States. The FEMA FY 95 budget has been

revised to correspond to the functional structure. For example, FEMA

restructured its civil defense program to emphasize an all- hazards,

integrated emergency management approach. Several line items in the

program were integrated to provide the States greater flexibility in

the use of FEMA resources to develop this all-hazards emergency

management capability. FEMA is also restructuring its Comprehensive

Cooperative Agreement (CCA) from a programmatic to a functional

approach for FY 1995. This approach will more closely reflect the

States' annual program planning and will eliminate duplicative work

activities and reduce associated reporting burdens; provide a more

flexible basis for Federal/State negotiations; provide greater

flexibility in the use of Federal funds to develop emergency

management capabilities; and integrate and functionally organize work

activities. The restructuring of CCA was established through a

collaborative, intergovernmental partnership between FEMA and NEMA

State representatives.

DOT has implemented two of NPR's recommendations to reduce

regulations and processing times which have improved customer service

to grantees and have provided flexibility to the grantees in terms of

"pre-award authority" to permit grantees to incur costs prior to

final Federal approval when reimbursement conditions are met.

Strengthened Partnerships


State Capacity Implementation Steering Committee --

EPA has developed an intergovernmental steering committee to guide

efforts towards an Agency/State environmental partnership. Through

this committee, the EPA has established principles for a more

flexible grant process and are in the process of establishing the

necessary legislative strategy.

National Community Development Initiative (NCDI) --

HUD has formed a partnership with a consortium of philanthropic

foundations to help build the capacity of community development

corporations. HUD's investment of $20 million has been used to

leverage an additional $60 million of foundation funds -- making it

the largest single fund for such activity in the nation.

Reinvention Lab for Intergovernmental Partnership --

The Department of Energy's Office of Energy Efficiency and Renewable

Energy is sponsoring a reinvention lab on "Reinventing Federal,

State, and Local Partnerships." The mission of this pilot project is

to broaden DOE's network of external stakeholders, to increase

understanding of capabilities and goals, and to invent better

partnerships. Three specific activities are the focus of this

reinvention lab: 1) involve stakeholders earlier and more completely

in strategic operating and budget planning; 2) to invent more

effective and flexible ways to implement state and local provisions

of the Energy Policy Act of 1992; and 3) to build stronger public and

private collaborations to deploy new energy efficiency and renewable

energy technologies in the marketplace.

Welfare Reform --

Outreach to state and local officials has been a central component of

the Administration's welfare reform policy development process. The

White House Working Group on Welfare Reform, Family Support and

Independence, established by the President in May, 1993, has sought

and received considerable input from state and local leaders in

welfare reform.

Streamlining Internal Processes

Waiver Process Streamlining --

HHS has taken steps to simplify their waiver approval process,

including: providing concurrent review of state waiver applications

by different components of the Executive Branch; increasing

technical assistance; measuring budget neutrality over the life of

the waiver instead of annually; and, considering alternative

evaluation designs.

Streamlining and Reduction of Management Barriers --

Commerce has undergone a variety of efforts in the past year to

streamline the internal grants processes which has resulted in

reduced paperwork and faster processing of application for financial


The Employment and Training Administration (ETA) --

ETA at Labor has streamlined its internal procurement process to

ensure a more responsive system for the solicitation, selection and

award of grants to recipients at the state and local levels.

Financial Management of Cooperative Inspection Program --

The Food and Inspection Service (FSIS) at USDA has analyzed and is

currently in the process of simplifying procedures for coordination

and control of financial management of the Cooperative Meat and

Poultry Inspection programs with State agencies. In the past, all

documentation relating to budgeting and fiscal matters was processed

through FSIS Regional Offices. Now, the State agencies will deal

directly with FSIS headquarters in these matters, permitting a faster

turn-around and eliminating additional processing steps.

International Cooperation and Development Grants and Agreements --

The Office of International Cooperation and Development (ICD) at the

USDA has taken steps to reduce record-keeping and paper work by grant

recipients. ICD has cut back on the number of forms required and the

back-up material that recipients must retain.

Grant Process Streamlining at DOT --

The Department of Transportation is working to streamline the

processing of grant applications and reporting forms. Electronic

submission of grant forms and reductions in the number and frequency

of certifications should reduce the red tape associated with the

grants process. The Department is also working to make the single

audit process more effective to reduce the oversight

demands on Federal managers and grantees.




Cross-medial Flexibility for Improved Environmental Performance --

The Internal EPA Performance Review has put forth a recommendation

that the Agency approve state and local pilot projects to demonstrate

cross-media flexibility for improved environmental performance. In

exchange for a certain degree of flexibility within their grants,

states will demonstrate that they are targeting high risk

environmental needs and addressing environmental concerns in a multi-

media, holistic manner. The Agency is currently drafting an action

plan for immediate implementation of this recommendation and is

seeking state and local demonstration projects. The State of

Massachusetts is currently developing an innovative pilot whereby,

through increased grant flexibility, the State will target high-

priority polluting facilities for multi-media inspection and

enforcement actions. Instead of having air, water, and waste

inspectors do three individual inspections on a polluting facility,

Massachusetts wants to have the flexibility to do all three

inspections at once. The State believes that multi-media inspections

will lead to improved compliance and enable them to identify

opportunities to reduce emissions.

Ecosystems Management Project --

EPA, the Department of Agriculture, the Department of Interior and

several other Federal agencies are working together to develop

ecosystem management projects in regions throughout the country.

This project will involve intergovernmental collaboration and


Community Planning and Development --

HUD is developing a strategy to consolidate seven separate community

planning and development plans that state and local jurisdictions are

required to prepare. The development process is highly inclusive and

involves recipients from around the nation.

HUD's Public and Indian Housing has formed working groups with

industry to accomplish a number of objectives including the review of

statutes and regulations to consolidate and enhance flexibility.

Multi-Purpose Water Grant Provision in the Clean Water Act --

The Administration is considering incorporating grant flexibility

into the reauthorization of the Clean Water Act (CWA). States

adopting a watershed approach to water quality management would be

able to apply for the various grants available under the CWA using a

single, integrated application. States would prepare an integrated

workplan to use the multi-purpose grant which would include defined

outputs and commitments, however, the States would have the latitude

of applying these funds to their highest- risk problems.

USDA has begun negotiations with the Department of Treasury to

provide States an opportunity to include direct Federal payment

programs in their Electronic Benefit Transfer systems.

Weights and Measures Training at USDA --

Scale accuracy is of paramount importance to the Packers and

Stockyards Administration's (P& SA). P& A relies heavily on State

and local weights and measures jurisdictions to provide tests and

reports on subject scales under cooperative agreements. P& A

personnel are certified to provide training on testing of livestock

and monorail scales under a national training program of the National

Conference on Weights and Measures. P&SA personnel conducted three

training programs for State weights and measures officials this past

year and will conduct at least two this year, one of which will be

customized to meet the needs of a particular State. This program

provides specialized training to State weights and measures officials

that would not otherwise be available.

Revisions to the Advance Planning Document Process --

The Food and Nutrition Service (FNS) at USDA has been meeting with a

joint Federal-State policy group to revise the Advance Planning

Document (APD) process. The initial effort is to focus on provisions

which may be changed without regulatory action. Included in the

proposed changes is the suggestion to increasing the dollar threshold

for Federal approval. This proposal will eliminate federal

involvement in minor systems changes that normally are not a problem,

but which require staff resources to produce, review, and approve the


The Food Stamp Program (FSP) at USDA has drafted two proposed rules

that would simplify current regulations and increase State agency

flexibility in administering the FSP. The first rule, entitled

Simplification of Program Rules, proposes changes in the areas of

recertification, standard utility allowances, residency, length of

certification periods, and notice requirements. As well as providing

State agencies with greater flexibility, many of the changes promote

conformance with procedures in the Aid to Facilities with Dependent

Children (AFDC) Program. The second rule, entitled Provisions on

General Assistance Vendor Payments and Student Earnings form Pub. L.

103-66 and changes in Requirements for Anticipating Income and

Reporting Changes, includes provisions that would simplify procedures

for handling reported changes in household circumstances. Both rules

are currently in clearance in USDA.

Business and Industry Audited Financial Statements --

The Rural Development Administration (RA) at the USDA has proposed,

subject to final clearance, to relax the requirements for Business

and Industry borrowers to furnish annual, audited financial

statements. Currently, the regulations require audited statements

from all borrowers, except seasoned loans, with a balance of $100,000

or less. The proposal would allow RA to accept unaudited annual

statements from new borrowers receiving loans not exceeding $500,000.

The proposal also will allow unaudited annual statements from all

borrowers that have provided audits for three years, are current on

repayment, and have a loan balance not exceeding $1,000,000. This

action will make the program more attractive and effective for small


Child Support Enforcement Program as a GPRA Lab--

This pilot program will collaborate with State and local governments

in establishing and achieving performance goals related to

establishment of paternity, court orders, cases in payment, and

collections compared to targets.

Cooperative Extension Service as a GPRA Lab --

The Extension Service currently conducts 7 base programs and 8

national initiatives. Four of the 8 national initiatives would form

the pilot program. These are: (1) Communities in Economic

Transition, including job, business, and market creation and increase

in tourism; (2) Plight of young children, including fostering

development of children in limited resource families and closing gaps

in services to these families; (3) Decisions for health including

childhood immunization and community health initiatives; (4) Food

safety and quality, including reducing the incidence of food-borne

illness. This pilot involves 1200 FTEs at the State and local


DOL Waivers --

Labor is considering waivers of regulations pertaining to its

programs in connection with state efforts to develop comprehensive

school-to-work transition systems and to provide comprehensive

employment and training services One-stop Career Centers. In

addition, DOL will also consider regulatory waivers affecting its

programs that deliver services in enterprise communities and

empowerment zones.

DOT Training Summit --

The Department of Transportation is convening a training summit which

will involve federal, state, metropolitan planning organizations,

city, county, transit officials and others in understanding the

Intermodal Transportation Efficiency Act of 1991 which expanded

opportunities to use transportation funding in a flexible manner.

DOT is also developing training courses in topics including public

participation in transportation planning, systems planning,

congestion management, and intermodal management systems. The

Department is also preparing a video for metropolitan planning

officials and a catalog of DOT supported training and outreach on

transportation planning and programming. Other measures are also

being taken to aid local officials in taking advantage of new


HHS Workgroup --

The Department has established an ongoing workgroup comprised of

staff offices and operating units to focus on improving customer

services through service integration and other approaches to program

innovation, comprehensiveness and Federal flexibility. With an

initial focus on children/families and the aging, the workgroup is

developing recommendations concerning: opportunities for

consolidating application and reporting requirements for Federal

programs; innovative criteria for evaluating coordinated or

integrated service systems at the local level; model training

programs for integrated or coordinated service staff at the local

level; and, potential opportunities for compatible program

eligibility requirements, program consolidations and/or

organizational improvements.

In addition, other HHS activities include: the development of a

continuing locus of assistance to state and local governments in

removing barriers in federal rules (or, in other words, a single

point of contact approach); the coordination of planning with other

departments on reducing violence; and, the establishment of better

linkages among selected programs at the community level.

HUD is currently take steps to create better linkages across programs

that are focusing on discrete elements of a related problem. For

example, HUD has designed economic opportunity grants to compliment

the family investment center initiative. Likewise, the allocation of

child care services and apprenticeship funds have been coordinated

with the overall strategy on the Jobs for Residents objective. HUD's

homeownership strategy will also draw the necessary linkages between

the National Homeownership Trust, the consolidated HOPE program,

homeownership counseling and the traditional FHA insurance for single

family homes.

HUD's Public Housing Modernization Regulations --

Public housing authorities will be given far more flexibility to

administer funds that have been backlogged, partially because of

burdensome regulatory requirements.

HUD's Five Component Reinvention Plan includes efforts for program

consolidation and simplification, reorganization of field structure

to simplify processes, revision of HUD Reform Act, and development of

work measurement indicators for each program office.

Department of Commerce --

As a part of the NPR effort, the United States Travel and Tourism

Administration (USTTA) is currently coordinating an extensive review

by the legislatively-established Tourism Policy Council (TPC) of all

Federal tourism programs in an effort to develop a coordinated and

comprehensive Federal tourism strategy. The TPC is comprised of the

heads of 15 Federal Departments and agencies that are involved in

travel and tourism. It is anticipated that by May 1994, the Council

will submit a report to the Vice President which will address

coordination and consolidation of activities. While current grant

activity in support of tourism appears to be limited, it is plausible

that the final strategy could call for consolidation of grant

programs. In addition, USTTA and the Economic Development Agency are

already cooperating in coordinating and administering disaster relief

grants related to travel and tourism.

Federal Housing Administration --

Under HUD, FHA has established a series of working groups to explore

transforming the mission of the agency as well as the way it does


In addition, HUD, with the assistance of Price Waterhouse, has

reviewed two programs and established plans to completely restructure

the public modernization programs and the FHIP using business

reengineering to achieve increased efficiency.


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