
From the U.S. Code Online via GPO Access
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[Laws in effect as of January 23, 2000]
[Document not affected by Public Laws enacted between
  January 23, 2000 and December 4, 2001]
[CITE: 42USC5318a]

 
                 TITLE 42--THE PUBLIC HEALTH AND WELFARE
 
                    CHAPTER 69--COMMUNITY DEVELOPMENT
 
Sec. 5318a. John Heinz Neighborhood Development Program


(a) Definitions

    For the purposes of this section:
        (1) The term ``eligible neighborhood development activity'' 
    means--
            (A) creating permanent jobs in the neighborhood;
            (B) establishing or expanding businesses within the 
        neighborhood;
            (C) developing, rehabilitating, or managing neighborhood 
        housing stock;
            (D) developing delivery mechanisms for essential services 
        that have lasting benefit to the neighborhood; or
            (E) planning, promoting, or financing voluntary neighborhood 
        improvement efforts.

        (2) The term ``eligible neighborhood development organization'' 
    means--
            (A)(i) an entity organized as a private, voluntary, 
        nonprofit corporation under the laws of the State in which it 
        operates;
            (ii) an organization that is responsible to residents of its 
        neighborhood through a governing body, not less than 51 per 
        centum of the members of which are residents of the area served;
            (iii) an organization that has conducted business for at 
        least one year prior to the date of application for 
        participation;
            (iv) an organization that operates within an area that--
                (I) meets the requirements for Federal assistance under 
            section 5318 of this title;
                (II) is designated as an enterprise zone under Federal 
            law;
                (III) is designated as an enterprise zone under State 
            law and recognized by the Secretary for purposes of this 
            section as a State enterprise zone; or
                (IV) is a qualified distressed community within the 
            meaning of section 1834a(b)(1) of title 12; and

            (v) an organization that conducts one or more eligible 
        neighborhood development activities that have as their primary 
        beneficiaries low- and moderate-income persons, as defined in 
        section 5302(a)(20) of this title; or
            (B) any facility that provides small entrepreneurial 
        business with affordable shared support services and business 
        development services and meets the requirements of subparagraph 
        (A).

        (3) The term ``neighborhood development funding organization'' 
    means--
            (A) a depository institution the accounts of which are 
        insured pursuant to the Federal Deposit Insurance Act [12 U.S.C. 
        1811 et seq.] or the Federal Credit Union Act [12 U.S.C. 1751 et 
        seq.], and any subsidiary (as such term is defined in section 
        3(w) of the Federal Deposit Insurance Act [12 U.S.C. 1813(w)]) 
        thereof;
            (B) a depository institution holding company and any 
        subsidiary thereof (as such term is defined in section 3(w) of 
        the Federal Deposit Insurance Act [12 U.S.C. 1813(w)]); or
            (C) a company at least 75 percent of the common stock of 
        which is owned by one or more insured depository institutions or 
        depository institution holding companies.

        (4) The term ``Secretary'' means the Secretary of Housing and 
    Urban Development.

(b) Duties of Secretary

    (1) The Secretary shall carry out, in accordance with this section, 
a program to support eligible neighborhood development activities by 
providing Federal matching funds to eligible neighborhood development 
organizations on the basis of the monetary support such organizations 
have received from individuals, businesses, and nonprofit or other 
organizations in their neighborhoods, and from neighborhood development 
funding organizations, prior to receiving assistance under this section.
    (2) The Secretary shall accept applications from eligible 
neighborhood development organizations for participation in the program. 
Eligible organizations may participate in more than one year of the 
program, but shall be required to submit a new application and to 
compete in the selection process for each program year. For fiscal year 
1993 and thereafter, not more than 50 percent of the grants may be for 
multiyear awards.
    (3) From the pool of eligible neighborhood development organizations 
submitting applications for participation in a given program year, the 
Secretary shall select participating organizations in an appropriate 
number through a competitive selection process. To be selected, an 
applicant shall--
        (A) have demonstrated measurable achievements in one or more of 
    the activities specified in subsection (a)(1) of this section;
        (B) specify a business plan for accomplishing one or more of the 
    activities specified in subsection (a)(1) of this section;
        (C) specify a strategy for achieving greater long term private 
    sector support, especially in cooperation with a neighborhood 
    development funding organization, except that an eligible 
    neighborhood development organization shall be deemed to have the 
    full benefit of the cooperation of a neighborhood development 
    funding organization if the eligible neighborhood development 
    organization--
            (i) is located in an area described in subsection 
        (a)(2)(A)(iv) of this section that does not contain a 
        neighborhood development funding organization; or
            (ii) demonstrates to the satisfaction of the Secretary that 
        it has been unable to obtain the cooperation of any neighborhood 
        development funding organization in such area despite having 
        made a good faith effort to obtain such cooperation; and

        (D) specify a strategy for increasing the capacity of the 
    organization.

(c) Criteria for awarding grants

    The Secretary shall award grants under this section among the 
eligible neighborhood development organizations submitting applications 
for such grants on the basis of--
        (1) the degree of economic distress of the neighborhood 
    involved;
        (2) the extent to which the proposed activities will benefit 
    persons of low and moderate income;
        (3) the extent of neighborhood participation in the proposed 
    activities, as indicated by the proportion of the households and 
    businesses in the neighborhood involved that are members of the 
    eligible neighborhood development organization involved and by the 
    extent of participation in the proposed activities by a neighborhood 
    development funding organization that has a branch or office in the 
    neighborhood, except that an eligible neighborhood development 
    organization shall be deemed to have the full benefit of the 
    participation of a neighborhood development funding organization if 
    the eligible neighborhood development organization--
            (A) is located in an \1\ neighborhood that does not contain 
        a branch or office of a neighborhood development funding 
        organization; or
---------------------------------------------------------------------------
    \1\ So in original. Probably should be ``a''.
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            (B) demonstrates to the satisfaction of the Secretary that 
        it has been unable to obtain the participation of any 
        neighborhood development funding organization that has a branch 
        or office in the neighborhood despite having made a good faith 
        effort to obtain such participation; and

        (4) the extent of voluntary contributions available for the 
    purpose of subsection (e)(4) of this section, except that the 
    Secretary shall waive the requirement of this subparagraph in the 
    case of an application submitted by a small eligible neighborhood 
    development organization, an application involving activities in a 
    very low-income neighborhood, or an application that is especially 
    meritorious.

(d) Consultation with informal working group

    The Secretary shall consult with an informal working group 
representative of eligible neighborhood organizations with respect to 
the implementation and evaluation of the program established in this 
section.

(e) Matching funds for participating organizations

    (1) The Secretary shall assign each participating organization a 
defined program year, during which time voluntary contributions from 
individuals, businesses, and nonprofit or other organizations in the 
neighborhood, and from neighborhood development funding organizations, 
shall be eligible for matching.
    (2) Subject to paragraph (3), at the end of each three-month period 
occurring during the program year, the Secretary shall pay to each 
participating neighborhood development organization the product of--
        (A) the aggregate amount of voluntary contributions that such 
    organization certifies to the satisfaction of the Secretary it 
    received during such three-month period; and
        (B) the matching ratio established for such test neighborhoods 
    under paragraph (4).

    (3) The Secretary shall pay not more than $50,000 under this section 
to any participating neighborhood development organization during a 
single program year, except that, if appropriations for this section 
exceed $3,000,000, the Secretary may pay not more than $75,000 to any 
participating neighborhood development organization.
    (4) For purposes of paragraph (2), the Secretary shall, for each 
participating organization, determine an appropriate ratio by which 
monetary contributions made to participating neighborhood development 
organizations will be matched by Federal funds. The highest such ratios 
shall be established for neighborhoods having the smallest number of 
households or the greatest degree of economic distress.
    (5) The Secretary shall insure that--
        (A) grants and other forms of assistance may be made available 
    under this section only if the application contains a certification 
    by the unit of general local government within which the 
    neighborhood to be assisted is located that such assistance is not 
    inconsistent with the comprehensive housing affordability strategy 
    of such unit approved under section 12705 of this title or the 
    statement of community development activities and community 
    development plans of the unit submitted under section 5304(m) of 
    this title, except that the failure of a unit of general local 
    government to respond to a request for a certification within thirty 
    days after the request is made shall be deemed to be a 
    certification; and
        (B) eligible neighborhood development activities comply with all 
    applicable provisions of the Civil Rights Act of 1964 [42 U.S.C. 
    2000a et seq.].

    (6) To carry out this section, the Secretary--
        (A) may issue regulations as necessary;
        (B) shall utilize, to the fullest extent practicable, relevant 
    research previously conducted by Federal agencies, State and local 
    governments, and private organizations and persons;
        (C) shall disseminate information about the kinds of activities, 
    forms of organizations, and fund-raising mechanisms associated with 
    successful programs; and
        (D) may use not more than 5 per centum of the funds appropriated 
    for administrative or other expenses in connection with the program.

(f) Authorization

    Of the amounts made available for assistance under section 5303 of 
this title, $1,000,000 for fiscal year 1993 (in addition to other 
amounts provided for such fiscal year) and $3,000,000 for fiscal year 
1994 shall be available to carry out this section.

(g) Short title

    This section may be cited as the ``John Heinz Neighborhood 
Development Act''.

(Pub. L. 98-181, title I, Sec. 123, Nov. 30, 1983, 97 Stat. 1172; Pub. 
L. 98-479, title I, Sec. 101(b)(2), (3), Oct. 17, 1984, 98 Stat. 2220; 
Pub. L. 100-242, title V, Secs. 521, 525, Feb. 5, 1988, 101 Stat. 1938, 
1939; Pub. L. 101-625, title IX, Sec. 915, Nov. 28, 1990, 104 Stat. 
4395; Pub. L. 102-550, title VIII, Sec. 832, Oct. 28, 1992, 106 Stat. 
3852; Pub. L. 105-362, title VII, Sec. 701(d), Nov. 10, 1998, 112 Stat. 
3287.)

                       References in Text

    The Federal Deposit Insurance Act, referred to in subsec. (a)(3)(A), 
is act Sept. 21, 1950, ch. 967, Sec. 2, 64 Stat. 873, as amended, which 
is classified generally to chapter 16 (Sec. 1811 et seq.) of Title 12, 
Banks and Banking. For complete classification of this Act to the Code, 
see Short Title note set out under section 1811 of Title 12 and Tables.
    The Federal Credit Union Act, referred to in subsec. (a)(3)(A), is 
act June 26, 1934, ch. 750, 48 Stat. 1216, as amended, which is 
classified generally to chapter 14 (Sec. 1751 et seq.) of Title 12. For 
complete classification of this Act to the Code, see section 1751 of 
Title 12 and Tables.
    The Civil Rights Act of 1964, referred to in subsec. (e)(5)(B), is 
Pub. L. 88-352, July 2, 1964, 78 Stat. 241, as amended, which is 
classified principally to subchapters II to IX (Sec. 2000a et seq.) of 
chapter 21 of this title. For complete classification of this Act to the 
Code, see Short Title note set out under section 2000a of this title and 
Tables.

                          Codification

    Section was enacted as the John Heinz Neighborhood Development Act 
and also as part of the Housing and Urban-Rural Recovery Act of 1983, 
the Domestic Housing and International Recovery and Financial Stability 
Act, and the Supplemental Appropriations Act, 1984, and not as part of 
the Housing and Community Development Act of 1974 which comprises this 
chapter.
    Section was formerly set out as a note under section 5318 of this 
title.


                               Amendments

    1998--Subsecs. (f) to (h). Pub. L. 105-362 redesignated subsecs. (g) 
and (h) as (f) and (g), respectively, and struck out former subsec. (f) 
which read as follows: ``The Secretary shall submit a report to the 
Congress, not later than 3 months after the end of each fiscal year in 
which payments are made under this section, regarding the program under 
this section. The report shall contain a summary of the activities 
carried out under this section during such fiscal year and any findings, 
conclusions, and recommendations for legislation regarding the 
program.''
    1992--Pub. L. 102-550, Sec. 832(b)(1), substituted ``John Heinz 
Neighborhood Development Program'' for ``Neighborhood Development 
Demonstration'' as section catchline.
    Subsec. (a)(2). Pub. L. 102-550, Sec. 832(d)(1)-(3), (4), 
redesignated subpars. (A) to (E) of par. (2) as cls. (i) to (v), 
respectively, of subpar. (A) of par. (2) and added subpar. (B).
    Subsec. (a)(2)(A)(iii). Pub. L. 102-550, Sec. 832(g)(1), substituted 
``one year'' for ``three years''.
    Subsec. (a)(2)(A)(iv). Pub. L. 102-550, Sec. 832(e)(1), added cl. 
(iv) and struck out former cl. (iv) which read as follows: ``an 
organization that operates within an area that meets the requirements 
for Federal assistance under section 5318 of this title; and''.
    Subsec. (a)(3), (4). Pub. L. 102-550, Sec. 832(e)(2), (3), added 
par. (3) and redesignated former par. (3) as (4).
    Subsec. (b)(1). Pub. L. 102-550, Sec. 832(f)(1), inserted ``, and 
from neighborhood development funding organizations,'' after 
``neighborhoods''.
    Pub. L. 102-550, Sec. 832(b)(2), (3), struck out ``demonstration'' 
before ``program'' and substituted ``to support eligible'' for ``to 
determine the feasibility of supporting eligible''.
    Subsec. (b)(2). Pub. L. 102-550, Sec. 832(b)(2), (g)(2), struck out 
``demonstration'' before ``program.'' and substituted ``For fiscal year 
1993 and thereafter, not more than 50 percent'' for ``Not more than 30 
per centum''.
    Subsec. (b)(3)(B). Pub. L. 102-550, Sec. 832(f)(2)(A), struck out 
``and'' at end.
    Subsec. (b)(3)(C). Pub. L. 102-550, Sec. 832(f)(2)(B), substituted 
``, especially in cooperation with a neighborhood development funding 
organization, except that an eligible neighborhood development 
organization shall be deemed to have the full benefit of the cooperation 
of a neighborhood development funding organization if the eligible 
neighborhood development organization--'' and cls. (i) and (ii) for 
period at end.
    Subsec. (b)(3)(D). Pub. L. 102-550, Sec. 832(f)(2)(C), added subpar. 
(D).
    Subsec. (c)(3). Pub. L. 102-550, Sec. 832(f)(3), inserted before 
semicolon ``and by the extent of participation in the proposed 
activities by a neighborhood development funding organization that has a 
branch or office in the neighborhood, except that an eligible 
neighborhood development organization shall be deemed to have the full 
benefit of the participation of a neighborhood development funding 
organization if the eligible neighborhood development organization--'' 
and subpars. (A) and (B).
    Subsec. (e)(1). Pub. L. 102-550, Sec. 832(f)(4), inserted ``, and 
from neighborhood development funding organizations,'' after 
``neighborhood''.
    Subsec. (e)(3). Pub. L. 102-550, Sec. 832(b)(4), inserted before 
period ``, except that, if appropriations for this section exceed 
$3,000,000, the Secretary may pay not more than $75,000 to any 
participating neighborhood development organization''.
    Subsec. (e)(5)(A). Pub. L. 102-550, Sec. 832(c), substituted 
``comprehensive housing affordability strategy of such unit approved 
under section 12705 of this title or the statement of community 
development activities and community development plans of the unit 
submitted under section 5304(m) of this title'' for ``housing and 
community development plans of such unit''.
    Subsec. (e)(6)(C). Pub. L. 102-550, Sec. 832(b)(5)(A), inserted 
``and'' after ``programs;''.
    Subsec. (e)(6)(D), (E). Pub. L. 102-550, Sec. 832(b)(5)(B)-(D), 
redesignated subpar. (E) as (D), substituted ``program'' for 
``demonstration'', and struck out former subpar. (D) which read as 
follows: ``shall undertake any other activity the Secretary deems 
necessary to carry out this section, which shall include an evaluation 
and report to Congress on the demonstration and may include the 
performance of research, planning, and administration, either directly, 
or when in the Secretary's judgment such activity will be carried out 
more effectively, more rapidly, or at less cost, by contract or grant; 
and''.
    Subsec. (f). Pub. L. 102-550, Sec. 832(b)(6), added subsec. (f) and 
struck out former subsec. (f) which read as follows: ``The Secretary 
shall submit to the Congress--
        ``(1) not later than three months after the end of each fiscal 
    year in which payments are made under this section, an interim 
    report containing a summary of the activities carried out under this 
    section during such fiscal year and any preliminary findings or 
    conclusions drawn from the demonstration program; and
        ``(2) not later than March 15 of the year after the end of the 
    last fiscal year in which such payments are made, a final report 
    containing a summary of all activities carried out under this 
    section, the evaluation required in subsection (e)(6)(D) of this 
    section and any findings, conclusions, or recommendations for 
    legislation drawn from the demonstration program.''
    Subsec. (g). Pub. L. 102-550, Sec. 832(a), amended subsec. (g) 
generally. Prior to amendment, subsec. (g) read as follows: ``To the 
extent provided in appropriations Acts, of the amounts made available 
for assistance under section 5303 of this title, $2,000,000 for fiscal 
year 1991 and $2,000,000 for fiscal year 1992 shall be available to 
carry out this section.''
    Subsec. (h). Pub. L. 102-550, Sec. 832(b)(7), added subsec. (h).
    1990--Subsec. (g). Pub. L. 101-625 amended subsec. (g) generally. 
Prior to amendment, subsec. (g) read as follows: ``There are authorized 
to be appropriated to carry out this section $2,000,000 for fiscal year 
1988, and $2,000,000 for fiscal year 1989.''
    1988--Subsec. (e)(3). Pub. L. 100-242, Sec. 525, substituted ``under 
this section'' for ``under this Act''.
    Subsec. (g). Pub. L. 100-242, Sec. 521, amended subsec. (g) 
generally. Prior to amendment, subsec. (g) read as follows: ``For 
purposes of carrying out this section, there are authorized to be 
appropriated not to exceed $2,000,000 for each of the fiscal years 1984 
and 1985.''
    1984--Subsec. (b)(3)(A), (B). Pub. L. 98-479, Sec. 101(b)(2), 
substituted ``subsection (a)(1)'' for ``subsection (a)(4)'' wherever 
appearing.
    Subsec. (c). Pub. L. 98-479, Sec. 101(b)(3), struck out ``(1)'' 
before ``The Secretary shall award'' and redesignated subpars. (A) to 
(D) as pars. (1) to (4), respectively.
