Office of Management and Budget

Office of Management and Budget
News Release

FOR IMMEDIATE RELEASE
November 1, 2001

2001-56

Administration Announces Additional Assistance for New York Economic Recovery

Washington, DC -- Office of Management and Budget Director Mitchell E. Daniels, Jr., announced today a $2.8 billion economic assistance package for New York. This economic assistance package will allow New York to target aid to businesses affected by the terrorist attacks on the World Trade Center and to assist in the City’s economic recovery. "The President has authorized support for New York unprecedented in both scope and cost. Cleanup, rebuilding and victim assistance will dwarf that provided in any previous catastrophe. Today the President is moving on yet another front. New York presented a variety of creative ideas aimed at economic recovery, and we are pleased to be able to take action on three of these requests," Daniels stated.

The $2.8 billion assistance package is the result of consultations with Governor Pataki, Mayor Giuliani, Senator Clinton, Senator Schumer and the bi-partisan members of the New York House Congressional delegation to determine needs and priorities. The package is designed to assist New York in its efforts to mitigate the potential loss of businesses and jobs from Lower Manhattan.

This assistance is the latest installment of federal support to the New York area to deal with the effects of the September 11th terrorist attacks. Previous supplemental releases have included funding for emergency response, debris removal, and public infrastructure repair. Pursuant to the President’s $20 billion commitment to deal with the effects of the attacks, the total federal assistance either enacted or proposed now stands at over $14 billion.

The economic assistance package comprises three elements. Each of these actions was specifically requested by state and local officials, and each will require a special exemption to existing law.

$700 million in funding for the Community Development Block Grants program (CDBG). The $700 million grant to New York will be the largest grant made in CDBG’s history. The administration is working with Representative Walsh and Senator Schumer to secure a one-time change to the existing CDBG law, which ordinarily precludes the program from funding high-income areas. These CDBG grants will allow New York to target assistance to businesses affected by the disaster. These funds will be provided out of the $40 billion emergency supplemental appropriations act already enacted.

$2 billion in tax-exempt financing. The funds would be used for New York City as a means to finance the replacement of commercial office space lost to the terrorist attacks in Lower Manhattan. For reference, this would more than double the total amount of tax-exempt private activity bonds available for the entire State of New York. This proposal will also require enabling legislation.

$110 million in savings to the State and City through regulatory relief from federal mandates on the Temporary Assistance for Needy Families and food stamp programs. United States Department of Agriculture (USDA) will provide New York with additional Food Stamps and Employment Training funds to assist unemployed workers. The administration will seek legislation to allow New York to utilize unspent TANF funds without a maintenance of effort requirement. Additionally, Department of Health and Human Services (HHS) will provide New York with a waiver allowing it to extend the duration of emergency homeless assistance under the TANF program.

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