A Summary of HR 3467, “Saving Our Children: The American Renewal Community Act of 1996

Creates Renewal Communities: Up to 100 “renewal communities” will be created nationwide. Each community must possess certain characteristics to qualify as a “renewal community,” such as:

  1. a high unemployment rate;
  2. high poverty rate; and
  3. a disproportionate amount of low-income households.

State and local government officials — who are responsible for nominating designated areas for “renewal community” status to be approved by The Department of Housing and Urban Development — must make several written commitments for a nominated area to be considered. These include:

  1. a reduction in taxes and fees;
  2. more efficient local services;
  3. crime reduction strategies;
  4. a streamlining of government requirements and regulations; and
  5. greater coordination of private organizations and community groups.

Once a local area is designated as a renewal community, federal taxes on private investment (capital gains, etc.) are automatically reduced or abolished.

Offers Low-Income Educational Opportunity Scholarship Program: Local officials representing “renewal communities” must operate an educational opportunity scholarship program for families:

  1. residing in the community;
  2. earning no more than 185% of the poverty line; and
  3. electing to enroll in the program.

Parents who enroll their children in the program will be able to send them to alternative public schools, charter schools, and private schools (including religious schools). Special safeguards are built into the legislation to protect private schools from further government intrusiveness and restrictions. Additional regulations or burdensome paperwork, restrictions on religious instruction, violations of rights granted in the Religious Freedom Restoration Act of 1993, infringements on a religious school’s demands that employees adhere to the religious tenets and moral code of behavior of the school, and the elimination of single-sex schools or classes will not be allowed.

Rewards Charitable Giving: Donations to charities up to $200 by individuals and $400 by families will be credited up to as much as 75%, regardless of whether the taxpayer itemizes the deductions. To qualify for the tax credit, the taxpayer must give money to a charity that offers direct services to individuals whose annual incomes do not generally exceed 185% of the poverty line. The charities are not permitted to engage in political activities.

Allows for the Use of Faith-Based Drug Treatment Centers: This provision of the bill has three goals:

  1. allowing faith-based substance abuse treatment centers to receive federal assistance;
  2. making it easier for individuals who are receiving federally funded drug treatment to select drug treatment therapy that is religious in nature; and
  3. protecting the rights of individuals receiving drug treatment by ensuring that no individual can be required to receive services from a religious organization, and guaranteeing that those who wish to do so can receive treatment from secular centers.

Broadens the Scope of the Work Opportunity Tax Credit: To offset the cost of hiring high-risk employees, employers will be eligible to receive a 35% credit on the first $6,000 of first-year wages paid per high-risk employee. High-risk employees include: AFDC or food stamp recipients and their families; economically disadvantaged veterans, ex-felons, and high-risk youth; vocational rehabilitation referrals; and qualified summer youth employees. The tax credit will be available to employers nationwide, not just to those whose businesses reside in a “renewal community.”

-by Arturo Silva, Project 21 (202) 507-6398 or [email protected] Source: The Heritage Foundation’s Issue Bulletin 228 “Saving The Children: How Congress Can Help Poor Kids and Revitalize America’s Inner City Neighborhoods.” Issue date: July 26, 1996.

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