On July 22, the Biden administration announced a $3 billion economic development plan focused on supporting jobs and economic recovery among underserved and distressed communities affected by the COVID-19 pandemic.
The plan, ‘Investing in America’s Communities’, was announced by Secretary of Commerce Gina Raimondo during a press briefing at the White House. It will be implemented via the Department of Commerce’s Economic Development Administration (EDA).
Raimondo claimed that the plan would bring “transformative growth” to communities all over the country through investments in innovation, infrastructure, and workforce training.
“From working mothers balancing multiple jobs, to young adults looking for work, to factory and retail workers wondering what comes next − these funds will provide real, good-paying jobs for you and your community… As a former Governor, I know what good-paying jobs can mean to American families. That’s why we believe this initiative has the potential to create 300,000 new jobs in the near term,” Raimondo said at the press briefing.
The $3 billion will be allocated as follows:
- Build Back Better Regional Challenge ($1 billion): The funds will be invested in up to 30 regions for revitalizing local economies. The program seeks to drive innovation that will help in scaling existing industries and grow new ones.
- Travel, Tourism, and Outdoor Recreation ($750 million): To speed up recovery of the sector and the communities that rely on it.
- Good Jobs Challenges ($500 million): Allocated for workforce training programs and apprenticeships to place workers in “good-paying” jobs. The program is targeted particularly to “women, people of color, and underserved communities.”
- Economic Adjustment Assistance ($500 million): Funds to be distributed to “hundreds of communities” for economic development and job creation.
- Coal Communities Commitment ($300 million): Funds aimed at improving the economic condition of the communities. The members are struggling amidst the Biden administration’s move to shift America away from fossil fuels to clean energy technologies.
- Indigenous Communities Commitment ($100 million): Will be used to set up broadband, health centers, etc. among indigenous communities.
During her remarks, Raimondo talked about how the EDA’s investments across the span of the past ten years have enabled Albany, New York, to transform itself into a global hub for semiconductor development and projects associated with bioscience. Raimondo claimed that such investments have resulted in an employment growth rate of over 30 percent in these sectors.
The Commerce Department has begun accepting applications for the grants. The department will select eligible recipients depending on the anticipated return on investment to taxpayers. “Our number one investment priority is equity… In order to qualify to get the money you have to prove to us you’ll have an equity lens,” Raimondo stated.
Investing in America’s Communities plan will be funded by the $1.9 trillion American Rescue Plan Act that was signed into law by President Joe Biden on March 11. The bill had passed the House and Senate largely along party lines, with most Democrats voting in support while Republicans opposed it.
The Republican opposition was mostly based on the argument that the $1.9 trillion plan was unaffordable. Larry Summers, an economic advisor during the Obama administration, had criticized the package, calling it the “least responsible” economic policy in the past four decades.
Some Republicans also claimed that the bill would only benefit Democrat states. According to the bill, 61 percent of the aid would go to states that had voted for Biden in the 2016 presidential election.