Senate Floor Speech
Senator Kay Bailey Hutchison
April 27, 1999 -- Page: S4278

MRS. HUTCHISON. Mr. President, today I am pleased to introduce, along with Mr. Santorum, and Mr. Cochran, the Commercial Revitalization Tax Credit Act of 1999. This bill is identical to the bipartisan and widely supported legislation I sponsored during the last session of Congress.

This measure will create jobs, expand economic activity, and revitalize the physical structure and value of residential and commercial buildings in America's most distressed urban and rural communities.

The bill provides a targeted tax credit to businesses to help defray the cost of construction, expansion, and renovation in these areas, and in the process will generate billions in privately based economic activity in those areas that need the most help in our country.

As we continue to look for ways to combat the decay of our inner cities and to raise the standard of living in many of our rural areas, I believe, and numerous studies demonstrate, that reversing the physical deterioration in America's cities has numerous and far reaching economic benefits. Revitalization in decaying neighborhoods lifts the hopes and expectations of the residents of those areas that economic growth and opportunity is coming their way. Indeed, one of the key recommendations of a top-to-bottom review of law enforcement in this city, our Nation's Capital, was to improve the many abandoned buildings in Washington, D.C. that create an atmosphere conducive to crime and despair.

The Commercial Revitalization Tax Credit Act will build upon the empowerment zone/enterprise community program that is now unfolding over 100 communities in the United States. Texas has five of these specially designated areas: Houston, Dallas, El Paso, San Antonio, and Waco, as well as one rural zone in the Rio Grande valley covering four counties. Not only will these cities qualify for the credit under my bill, but so will the 400 communities in the United States that sought such designation but were not selected. State-established enterprise zones and other specifically designated revitalization districts established by State and local governments will also be able to participate. In all, over 1,000 areas will qualify for this credit nationwide.

Our bill contains the following principle features: A tax credit that may be applied to construction amounting to at least 25 percent of the basis of the property, in designated revitalization areas; qualified investors could choose a one-time 20-percent tax credit against the cost of new construction or rehabilitation. Alternatively, a business owner could take a five percent credit each year over a 10-year period. Tax credits would be allocated to each state, according to a formula, with States and localities determining the priority of the projects. In all, $1.5 billion in tax credits would be allocated under this tax bill.

Mr. President, with a minimum level of bureaucratic involvement and through a proven tax mechanism, this initiative will make a significant difference in the lives of thousands of families in need and for the economies of hundreds of distressed urban and rural communities across this Nation.

I hope my colleagues will join me in supporting this sound and effective pro-growth initiative.