Statement of the Hon. J.C. Watts, Jr., a Representative in Congress from the State of Oklahoma

Testimony Before the Subcommittee on Oversight
of the House Committee on Ways and Means

Hearing on Tax Incentives for Renewal Communities

May 21, 2002

Thank you, Mister Chairman, not only for inviting me to this hearing today, but for your interest in community renewal and offering tax incentives for economic development.  I also thank my colleague, Congressman Danny Davis, for his leadership, tireless effort and continued interest in community renewal.  This is a bi-partisan initiative in the truest sense of the words.

Today’s hearing on community renewal coincides with an excellent conference organized by the Department of Housing and Urban Development.  It is extremely encouraging to see Congress and the administration working closely toward renewing communities and strengthening neighborhoods.

Back in 1995, some of us in Congress had a vision for communities across the country.  We saw poverty and hopelessness in cities, towns and rural communities – some that were once vibrant, and some that never seemed to achieve the level of prosperity that many neighborhoods enjoy.  Members from both sides of the aisle made the case for new and needed tools to build environments of hope to replace communities of despair.

Along with Congressmen Jim Talent of Missouri and Floyd Flake of New York, I introduced a bill called the Community Renewal Act to foster economic development to distressed urban and rural areas.  The logic was very simple:  when private industry flourishes in communities, it affects people’s lives.  It creates jobs for residents.  It provides services for neighbors.  It improves the community by providing opportunity.

It was a long road traveled, but my colleagues back then and I communicated the many benefits of community renewal until the concept was signed into law in December 2000.

In January of this year, HUD finished a nomination and selection process, choosing forty renewal communities – twenty-eight urban and twelve rural.  These cities, towns and counties were made eligible for a series of economic growth incentives:  capital gains rate reduction for businesses in renewal communities, wage credits for eligible employees, more deductions on capital expenditures and a commercial revitalization tax deduction to promote commercial development.

Communities are the fabric of our society.  They define who we are as a people – who we are as a nation.

The federal government should not get involved in the day-to-day management of state and local affairs.  But we can give them a helping hand by providing incentives to better their communities.  Through the community renewal act, we have.  Now, with the leadership of HUD Secretary Mel Martinez and many others, the task at hand is to educate administrators in the heartland about each and every incentive that is public law in order to create jobs in America’s poorest communities.

Turning vacant lots into thriving businesses empowers communities.  Converting abandoned buildings into affordable housing renews communities.  Creating support services and improving education and health care strengthens communities.

These goals are attainable.  The groundwork has been established.

Through public and private partnerships, from everyone like the government to the faith-based community, lives can be changed and our neighborhoods can be renewed.

Community renewal is a wonderful thing when it works.  I thank the people in this hearing room who have come to Washington to learn how to attract business and capital into their localities.  And I thank this subcommittee for allowing me to speak on such an important subject.  The difference community renewal will make will change the lives of not only the citizens of today, but the children of tomorrow.  With that, Mister Chairman, I thank you for the time.