Social Investment and Economic Development for the Americas Act of 2007

HR 3692 IH

110th CONGRESS

1st Session

H. R. 3692

To authorize the establishment of a Social Investment and Economic Development Fund for the Americas to provide assistance to reduce poverty, expand the middle class, and foster increased economic opportunity in the countries of the Western Hemisphere, and for other purposes.

IN THE HOUSE OF REPRESENTATIVES

September 27, 2007

Mr. ENGEL (for himself, Mr. BURTON of Indiana, Mr. LANTOS, Ms. ROS-LEHTINEN, Mr. MEEKS of New York, Mr. HASTINGS of Florida, Mr. PAYNE, Ms. MCCOLLUM of Minnesota, Mr. MCGOVERN, Mr. HONDA, Mr. BACA, Ms. LEE, Mrs. CHRISTENSEN, Mr. SIRES, Mr. DELAHUNT, Mr. LINCOLN DIAZ-BALART of Florida, Ms. CLARKE, Mr. MORAN of Virginia, and Ms. NORTON) introduced the following bill; which was referred to the Committee on Foreign Affairs, and in addition to the Committee on Financial Services, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned

A BILL

To authorize the establishment of a Social Investment and Economic Development Fund for the Americas to provide assistance to reduce poverty, expand the middle class, and foster increased economic opportunity in the countries of the Western Hemisphere, and for other purposes.

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

(a) Short Title- This Act may be cited as the `Social Investment and Economic Development for the Americas Act of 2007'.

(b) Table of Contents- The table of contents for this Act is as follows:

Sec. 1. Short title; table of contents.

Sec. 2. Findings.

Sec. 3. Amendment to Foreign Assistance Act of 1961.

Sec. 4. Amendment to the Inter-American Development Bank Act.

Sec. 5. Sense of Congress.

Sec. 6. Payment of arrears owed by United States to the Multilateral Investment Fund.

SEC. 2. FINDINGS.

Congress makes the following findings:

(1) It is in the national interest and national security interest of the United States to help foster security and stability in Latin America and the Caribbean .

(2) Over the past 25 years, there has been tremendous progress on democracy and economic growth in the Western Hemisphere, and the hemisphere is now a region dominated by democracies and democratic values.

(3) The United States contributes, on average, $820,000,000 in bilateral development assistance to Latin America and the Caribbean each year and has continued to strengthen its commitment to promoting our shared values, heritage, and culture while confronting the common challenges we face.

(4) The United States has also contributed through the Millennium Challenge Account more than $269,000,000 in development assistance to countries in the region that have demonstrated a commitment to just and democratic governance, economic freedom, and investing in their people.

(5) Poverty and inequality remain historic and persistent problems in the region, which undermine progress on social and economic development. These problems contribute to the rise of populist ideas and add to inequality. The poverty rate in Latin America is almost 40 percent, with little significant change since the 1980s, and Latin America remains the region with the most unequal distribution of wealth in the world.

(6) The region must also face the challenges of staggering crime rates, weak judicial systems, and inadequate housing, health care, and educational systems.

(7) By expanding the middle class through promoting microenterprise, improving the investment climate, and creating a competitive workforce in Latin America and the Caribbean , the United States will be able to help respective governments improve economic development in the region, and the countries of the region will become stronger trading partners with the United States.

(8) Working in partnership with the countries of the region, the United States can play a positive role in addressing these challenges.

(9) As President George W. Bush said on March 5, 2007, `The working poor of Latin America need change, and the United States of America is committed to that change. It is in our national interests, it is in the interest of the United States of America to help the people in democracies in our neighborhood succeed. When our neighbors are prosperous and peaceful, it means better opportunities and more security for our own people. When there are jobs in our neighborhood, people are able to find work at home and not have to migrate to our country. When millions are free from poverty, societies are stronger and more hopeful.'

(10) In order to effect significant reduction of poverty and enhance sustainable development, the United States must continue to make a long-term commitment of significant resources to programs that impact on housing, health care, and educational systems.

SEC. 3. AMENDMENT TO FOREIGN ASSISTANCE ACT OF 1961.

Part I of the Foreign Assistance Act of 1961 (22 U.S.C. 2151 et seq.) is amended by adding at the end the following new chapter:

`CHAPTER 13--SOCIAL INVESTMENT AND ECONOMIC DEVELOPMENT FOR THE AMERICAS

`SEC. 499H. AUTHORIZATION OF ASSISTANCE.

`(a) Assistance- The President, acting through the Administrator of the United States Agency for International Development and working with foreign governments and civil society, shall provide increased and sustained assistance to reduce poverty, expand the middle class, and foster increased economic opportunity in the countries of the Western Hemisphere by helping to--

`(1) improve the quality of life and invest in human capital, specifically by promoting education, improving health and disease prevention, and increasing the access to and quality of housing;

`(2) reduce crime, particularly violent crime, including murder, kidnapping, gang violence, and violence against women;

`(3) generate rural development and reduce poverty in the agricultural and non-agricultural rural sector;

`(4) strengthen the rule of law, governance, and democracy through the establishment of independent judiciaries, efficient processes to adjudicate claims, and trusted law enforcement bodies; and

`(5) reduce poverty and eliminate the exclusion of marginalized populations, including indigenous groups, people of African descent, women, rural and urban poor, and people with disabilities.

`(b) Contribution Requirement- To receive United States assistance under this chapter, a recipient country must contribute at least 10 percent of the total value of the funds the United States provides for projects in the recipient country. Such contribution is in addition to the funds such country regularly provides for these types of programs. Additional contributions may be required at the discretion of the Administrator of the United States Agency for International Development.

`(c) Ineligibility To Receive Assistance- The President shall be prohibited from providing assistance under this section to the government of a country that is ineligible to receive assistance under section 620, this part, or chapter 4 of part II.

`(d) Terms and Conditions- Assistance under this chapter may be provided on such other terms and conditions as the President may determine.

`(e) Coordination With Other Federal Agencies- The Administrator of the United States Agency for International Development shall coordinate with the heads of other Federal departments and agencies as necessary to carry out subsection (a).

`SEC. 499I. WESTERN HEMISPHERE ECONOMIC INVESTMENT AND DEVELOPMENT ADVISORY COMMITTEE.

`(a) In General- There is established within the United States Agency for International Development an advisory committee to be known as the Western Hemisphere Economic Investment and Development Advisory Committee (hereafter in this chapter referred to as the `Advisory Committee'). The Advisory Committee shall serve as a link among the United States Government, nongovernmental organizations, the private sector, and other interested parties and review projects funded under this Act.

`(b) Membership-

`(1) IN GENERAL- The Advisory Committee shall be composed of 6 members, of whom--

`(A) 1 member, who shall act as co-chairperson, shall be appointed by the President;

`(B) 1 member, who shall act as co-chairperson, shall be appointed by--

`(i) the majority leader of the Senate, in consultation with the senior member of the leadership of the House of Representatives belonging to the same political party as the majority leader of the Senate, if the majority leader of the Senate does not belong to the same political party as the President; or

`(ii) the minority leader of the Senate, in consultation with the senior member of the leadership of the House of Representatives belonging to the same political party as the minority leader of the Senate, if the majority leader of the Senate belongs to the same political party as the President;

`(C) 1 member shall be appointed by the majority leader of the Senate;

`(D) 1 member shall be appointed by the minority leader of the Senate;

`(E) 1 member shall be appointed by the Speaker of the House of Representatives; and

`(F) 1 member shall be appointed by the minority leader of the House of Representatives.

`(2) QUALIFICATIONS- Each member of the Advisory Committee shall be--

`(A) an individual with technical expertise with respect to the development of Latin America or the Caribbean ; or

`(B) a citizen of the United States with--

`(i) regional experience related to development in Latin America or the Caribbean ;

`(ii) technical or functional experience with respect to development issues; or

`(iii) extensive expertise in small business issues or international business experience in Latin America or the Caribbean .

`(c) Duties- The Advisory Committee shall--

`(1) consult with, provide information to, and advise the United States Agency for International Development and other United States Government agencies, as appropriate, on, and work closely with the United States Agency for International Development Regional Director, the Assistant Secretary for Western Hemisphere Affairs of the Department of State, and the United States Executive Director of the Inter-American Development Bank on matters related to this chapter;

`(2) meet at least twice annually and at other times as necessary;

`(3) serve as a liaison with, and provide information and counsel to, the private sector and nongovernmental organizations in relation to the projects covered under this chapter; and

`(4) review all impact evaluations on projects proposed for funding using assistance provided under section 499H(a) and make recommendations and submit a written report to the Administrator of the United States Agency for International Development with respect to the effectiveness of the projects and future changes to the program.

`(d) Conflicts of Interest- A member of the Advisory Committee shall not be permitted to review an application submitted by an organization with which the member has been or is affiliated or in which the member has had a financial interest.

`(e) Staff and Travel- Using funds appropriated pursuant to the authorization of appropriations under section 499L, the Advisory Committee may establish and maintain a staff of no more than 2 persons to provide administrative support and may maintain a budget for travel expenses.

`SEC. 499J. EVALUATION.

`(a) In General- The Administrator of the United States Agency for International Development shall ensure that projects carried out under this chapter are subject to rigorous, independent impact evaluations at the original design stage and conclusion of the projects to determine if they are helping to reduce poverty and foster social and economic development in the countries of the Western Hemisphere. When possible, such evaluations shall be conducted in coordination with evaluations of similar projects funded by other donors in order to expand the evidence base for decision-making.

`(b) Use of Evaluations- The Advisory Committee shall use information from the evaluations conducted under subsection (a) to inform future project decisions.

`SEC. 499K. REPORT.

`Not later than 1 year after the date of the enactment of the Social Investment and Economic Development for the Americas Act of 2007, and annually thereafter, the President shall prepare and submit to Congress a report on the specific programs, projects, and activities carried out under this chapter during the preceding year, including an evaluation of the results of such programs, projects, and activities. This report may be submitted with the budget justification materials submitted to Congress together with the budget of the President under section 1105(a) of title 31, United States Code.

`SEC. 499L. AUTHORIZATION OF APPROPRIATIONS.

`(a) In General- There are authorized to be appropriated to carry out this chapter, including for purposes of reducing poverty, expanding the middle class, and fostering increased economic opportunity in the countries of the Western Hemisphere, in addition to amounts of United States Foreign Assistance Funds (Function 150) otherwise authorized and appropriated and the $820,000,000 in bilateral development assistance provided by the United States, on average, to Latin America and the Caribbean each year, the following amounts:

`(1) $50,000,000 for fiscal year 2008.

`(2) $75,000,000 for fiscal year 2009.

`(3) $100,000,000 for fiscal year 2010.

`(4) $125,000,000 for fiscal year 2011.

`(5) $150,000,000 for fiscal year 2012.

`(6) $150,000,000 for fiscal year 2013.

`(7) $150,000,000 for fiscal year 2014.

`(8) $150,000,000 for fiscal year 2015.

`(9) $150,000,000 for fiscal year 2016.

`(10) $150,000,000 for fiscal year 2017.

`(b) Additional Authorities- Amounts appropriated pursuant to subsection (a)--

`(1) are authorized to remain available until expended;

`(2) are in addition to amounts otherwise available for such purposes; and

`(3) may be used to fund staff and travel expenses of the Advisory Committee.

`(c) Funding Limitation- Not more than 7 percent of the amounts appropriated pursuant to subsection (a) for a fiscal year may be used for administrative expenses.'.

SEC. 4. AMENDMENT TO THE INTER-AMERICAN DEVELOPMENT BANK ACT.

The Inter-American Development Bank Act (22 U.S.C. 283 et seq.) is amended by adding at the end the following new section:

`SEC. 39. SOCIAL INVESTMENT AND ECONOMIC DEVELOPMENT FUND FOR THE AMERICAS.

`(a) In General- The Secretary of the Treasury shall instruct the United States Executive Director at the Bank to use the voice, vote, and influence of the United States to urge the Bank to establish an account to be known as the `Social Investment and Economic Development Fund for the Americas' (in this section referred to as the `Fund'), which is to be operated and administered by the Board of Executive Directors of the Bank consistent with subsection (d). The United States Governor of the Bank may vote for a resolution transmitted by the Board of Executive Directors which provides for the establishment of such an account, and the operation and administration of the account consistent with subsection (d).

`(b) Other Contributions- The Fund may accept funds from other member countries of the Bank, private entities in the United States and in other member countries of the Bank, and countries in Latin America and the Caribbean .

`(c) Matching Requirement- No funds may be expended from the Fund until the total amount contributed by the United States in the first year of operation of the Fund has been matched.

`(d) Contribution Requirement- To receive assistance under this section, a recipient country must contribute at least 10 percent of the total value of the funds the Fund provides for projects in the recipient country. Such contribution is in addition to the funds such country regularly provides for these types of programs. Additional contributions may be required at the discretion of the Board of Governors of the Bank.

`(e) Use of Funds- The Fund shall be used to provide assistance to reduce poverty, expand the size of the middle class, and foster increased economic opportunity in the countries of the Western Hemisphere by helping to--

`(1) nurture public private partnerships and microenterprise development;

`(2) reduce the time and cost of starting a business and increase access to credit for small- and medium-sized businesses;

`(3) leverage personal remittances and reduce the cost of remittances sent to Latin America and the Caribbean , for the purpose of advancing economic and social development by--

`(A) increasing access to financial institutions for the poor, and working with local financial institutions to reduce fees and other costs associated with sending or receiving remittances;

`(B) working with local financial institutions to develop programs whereby personal remittances can be used as the basis for credit for mortgages and loans for small business, microenterprises, housing, and other enterprises;

`(C) providing matching funds for private entities in the United States that send donations for development projects in Latin America and the Caribbean ; and

`(D) fostering enabling environments for partnerships between civil society and local authorities that lead to greater accountability and improved processes for establishing priorities for remittances, including income-generating and wealth-building activities;

`(4) in conjunction with changes implemented by recipient countries, improve the investment climate in individual countries by strengthening the rule of law and implementing judicial reforms to increase transparency and predictability in judicial, tax, and regulatory systems;

`(5) increase workforce competitiveness in the global economy, specifically by focusing on application of technology and workforce training and development; and

`(6) reduce poverty and eliminate the exclusion of marginalized populations, including indigenous groups, people of African descent, women, rural and urban poor, and people with disabilities.

SEC. 5. SENSE OF CONGRESS.

It is the sense of Congress that--

(1) the amounts authorized to be appropriated to carry out this Act and the amendments made by this Act should be used to help countries in Latin America and the Caribbean focus on improving indicators in the area of investing in people, as that term is used in section 607(b)(3) of the Millennium Challenge Act of 2003 (22 U.S.C. 7706(b)(3)), and consistent with the transformational development program of the Department of State;

(2) the Multilateral Investment Fund, which was fully established in 1993 as part of President George H.W. Bush's Enterprise for the Americas Initiative, has been successful in promoting inclusive economic growth in Latin America and the Caribbean ;

(3) creating a public-private partnership working in coordination with the Multilateral Investment Fund will accelerate the work of the Multilateral Investment Fund and allow it to expand economic opportunity to the people in the Western Hemisphere; and

(4) as stated in section 499L of the Foreign Assistance Act of 1961, as added by section 3, amounts authorized to be appropriated pursuant to the amendments made by this Act for a fiscal year for initiatives to reduce poverty, expand the middle class, and foster increased economic opportunity in the countries of the Western Hemisphere are in addition to amounts that would be allocated or projected in the President's budget request for Latin America and the Caribbean for such fiscal year.

SEC. 6. PAYMENT OF ARREARS OWED BY UNITED STATES TO THE MULTILATERAL INVESTMENT FUND.

There is authorized to be appropriated to the Secretary of the Treasury $51,000,000 for payment to the Inter-American Development Bank of arrears owed by the United States to the Multilateral Investment Fund.