Remarks on the New Markets Legislation Agreement - Transcript

Weekly Compilation of Presidential Documents, May 29, 2000

May 23, 2000

The President. Thank you very much, everybody. And I think it's just "good afternoon." [Laughter] Mr. Speaker, Secretary Summers, Secretary Shalala, Administrator Alvarez, and Mr. Sperling from the White House. And I want to recognize here from the House of Representatives Congressman Rangel, Congressman Talent, Congressman Watts, Representatives Watt, Kanjorski, Jefferson, Vel[acute{a}]zquez, LoBiondo, Chambliss, Becerra, Bono, Davis, LaFalce, Price, Reyes, Waters, Hinojosa. I think that's everybody. [Laughter]

I'd also like to acknowledge people who aren't here who have supported this effort, to Chairman Archer and Representatives Clyburn, Roybal-Allard, Hayworth, Kildee, and the members of the Congressional Black Hispanic, and Indian Caucuses. And I want to acknowledge the presence in the audience of Mayor Webb of Denver and Mayor Campbell of Atlanta.

This morning Speaker Hastert and I have the honor of announcing a truly remarkable bipartisan achievement. We have completed an agreement to making historic investments in the untapped markets of America's inner cities, rural areas, and Native American reservations.

Today, our economy is the strongest it has ever been. But there are places that have still not been touched by our prosperity. For over 7 years, our administration has worked hard to change that. Under the Vice President's leadership, we have created and administered empowerment zones and enterprise communities; we have strengthened the Community Reinvestment Act and fostered community development banks and other community financial institutions. These initiatives, I believe, have made a significant difference in many places in America. But we know that we have more to do, and we know we must do more to get private sector firms to step up to their responsibility to create jobs and opportunity.

That's why I launched this new markets initiative last year. I've been to Appalachia, to the Mississippi Delta, to East Palo Alto, to Newark, to Phoenix, to many other inner cities, and I've been on the reservations of the Lakota Sioux and the Navajo.

Every place I've gone, I've seen talented people eager for opportunity and certainly able to work. They are the untapped markets that are not only crying out for their own opportunity but clearly presenting us an opportunity to keep our economic expansion going without inflation.

Early in this endeavor, I began to talk to the Speaker about this, and he told me he was interested in doing something, that it was something he was genuinely concerned about. Last November, on our second tour, the Speaker and I went together to Englewood, Illinois, along with Congressman Rush and Reverend Jackson. It's on the south side of Chicago. And together, we made a pledge to try to pool all the ideas that both parties had for dealing with this challenge and to try to come up with one unified, bipartisan effort. At the time, I said, and he said, that giving people a chance to make a living or start a business was neither a Republican nor a Democratic issue, but an American imperative.

Today we have Members of both parties here in substantial numbers to say that we're honoring the commitment we made at Englewood. We have achieved an agreement that will allow us to give every family in every community a stake in the prosperity Americans have worked so hard to build.

I'd like to give some of the details of this agreement and leave it to the Speaker to outline the rest. And then we'd like to invite four of our Members, two from each caucus who have been particularly active in this endeavor, to speak.

First, under the agreement, people who invest in a high unemployment, high poverty area anywhere in our country will qualify for a new markets tax credit equal to 30 percent of the amount they invest. The American people will share the risk of taking a chance on Americans. Of course, no one's going to put up the money if they think they're going to lose it. But at least this will give them a greater incentive to take that risk.

Second, the House of Representatives will authorize the other major pillars of the new markets initiative: new markets venture capital firms geared toward helping small and first-time entrepreneurs; America's Private Investment Companies, modeled on the Overseas Private Investment Corporation, which will help large-scale businesses expand and/or relocate to distressed inner-city communities. With these venture capital funds and APIC's, we'll provide two dollars of Government-guaranteed loans for every one dollar of equity capital investors put into new markets. That will lower their interest costs for borrowing and, again, reduce the risk of taking a chance on America. We will now be able to spur, with these initiatives, more than $20 billion in private sector investment.

Third, the agreement will give a major boost to our empowerment zones, which the Vice President helped to launch in 1993 and which have proven that investment in inner-cities and rural areas is a right and smart thing to do. The agreement will create a third round of zones and bring the total number up to 40. It will make both wage credits and tax-exempt bonds available across all the empowerment zones and extend the life of the zones to 2009.