SEC. 6030. RURAL STRATEGIC INVESTMENT PROGRAM.

The Consolidated Farm and Rural Development Act (as amended by section 6029) is amended by adding at the end the following:

‘‘Subtitle I—Rural Strategic Investment Program

‘‘SEC. 385A. PURPOSE.

‘‘The purpose of this subtitle is to establish a rural strategic investment

program—

‘‘(1) to provide rural communities with flexible resources to develop comprehensive, collaborative, and locally-based strategic planning processes; and

‘‘(2) to implement innovative community and economic development strategies that optimize regional competitive advantages.

‘‘SEC. 385B. DEFINITIONS.

‘‘In this subtitle:

‘‘(1) BENCHMARK.—The term ‘benchmark’ means an annual set of strategies and goals of a Regional Board established for the purpose of measuring performance in meeting the regional plan of the Regional Board.

‘‘(2) CONFERENCE.—The term ‘‘Conference’’ means the National Conference on Rural America conducted under section 385H.

‘‘(3) ELIGIBLE AREA.—

‘‘(A) IN GENERAL.—The term ‘eligible area’ means a nonmetropolitan county (as defined by the Secretary) that has a population of 50,000 inhabitants or less.

‘‘(B) INCLUSION.—

‘‘(i) IN GENERAL.—Subject to clause (ii), the term ‘eligible area’ includes an unincorporated or other area of a county that has a population of more than 50,000 inhabitants if the unincorporated area or other area is adjacent to an eligible rural area described in subparagraph (A).

‘‘(ii) PARTICIPATION.—An area described in clause (i) may be represented on a Regional Board.

‘‘(C) EXCLUSION.—The term ‘eligible area’ does not include any area designated by the Secretary as a rural empowerment zone or rural enterprise community.

‘‘(4) INNOVATION GRANT.—The term ‘innovation grant’ means an innovation grant made by the National Board to a Regional Board under section 385G.

‘‘(5) NATIONAL BOARD.—The term ‘National Board’ means the National Board on Rural America established under section 385D(a).

‘‘(6) NATIONAL PLAN.—The term ‘national plan’ means a national strategic investment plan of the National Board developed under section 385D(d)(3).

‘‘(7) PLANNING GRANT.—The term ‘planning grant’ means a regional strategic investment planning grant made by the National Board to a Regional Board under section 385F.

‘‘(8) PROGRAM.—The term ‘program’ means the rural strategic investment program established under this subtitle.

‘‘(9) REGION.—The term ‘region’ means the eligible areas that—

‘‘(A) are under the jurisdiction of a Regional Board; and

‘‘(B) meet criteria established by the National Board not later than 1 year after the date of enactment of this subtitle.

‘‘(10) REGIONAL BOARD.—The term ‘Regional Board’ means a Regional Investment Board certified under section 385C(a).

‘‘(11) REGIONAL PLAN.—The term ‘regional plan’ means a regional strategic investment plan of a Regional Board developed under section 385C(b)(3)(B).

‘‘SEC. 385C. REGIONAL INVESTMENT BOARDS.

‘‘(a) IN GENERAL.—The National Board may certify a group representing the interests described in subsection (b)(2)(A) as a Regional Investment Board created to develop and implement a regional strategic investment plan for grants made under this subtitle to promote investment in eligible areas.

‘‘(b) REQUIREMENTS FOR CERTIFICATION.—

‘‘(1) IN GENERAL.—A Regional Board shall meet the requirements of this subsection for certification.

‘‘(2) COMPOSITION.—

‘‘(A) IN GENERAL.—A Regional Board shall be composed of residents of the region that broadly represent diverse public, nonprofit, and private sector interests in investment in the region, including (to the maximum extent practicable) representatives of—

‘‘(i) units of local government (including  multijurisdictional units of local government); ‘‘(ii) in the case of regions with Indian populations, Indian tribes (as defined in section 4 of the Indian Self-Determination and Education  Assistance Act (25 U.S.C. 450b));

‘‘(iii) private nonprofit community-based development organizations;

‘‘(iv) regional development organizations;

‘‘(v) private business organizations;

‘‘(vi) other entities and organizations, as determined by the Regional Board; and

‘‘(vii) consortia of entities and organizations described in clauses (i) through (vii).

‘‘(B) LOCAL PUBLIC-PRIVATE REPRESENTATION.—Of the members of a Regional Board, to the maximum extent practicable—

‘‘(i) 1/2 of the members shall be representatives of units of local government and Indian ribes described in subparagraph (A); and

‘‘(ii) 1/2 of the members shall be representatives of nonprofit, regional, private, and other entities and organizations described in subparagraph (A).

‘‘(C) EX-OFFICIO MEMBERS.—

‘‘(i) IN GENERAL.—An officer or employee of a Federal or State agency may serve as an ex-officio, non-voting member of a  Regional Board representing the agency.

‘‘(ii) CONFLICTS.—Participation by a Federal officer or employee in activities of the Regional Board shall not constitute a violation of section 205 or 208 of title 18, United States Code.

‘‘(D) CERTIFICATION.—To be certified by the National Board, a Regional Board shall demonstrate to the National Board that the Regional Board is broadly representative of the interests described in subparagraph  (A).

‘‘(E) APPEALS.—

‘‘(i) IN GENERAL.—Prior to certification of the Regional Board by the National Board, representatives of interests described in subparagraph (A) that participated in the development of a Regional Board may appeal the composition of the Regional Board to the National Board on the ground that—

‘‘(I) the composition of the Regional Board does not adequately reflect the purposes of the program; or

‘‘(II) the selection process for the Regional Board unfairly disadvantaged those interests.

‘‘(ii) ACTION BY NATIONAL BOARD.—The National Board shall act on any appeal of the composition of a Regional Board before taking action on the certification of the Regional Board.

‘‘(3) DUTIES AND PURPOSE.—The organizational documents of the proposed Regional Board shall demonstrate that, on certification, the Regional Board shall—

‘‘(A) create a collaborative, inclusive public-private planning process;

‘‘(B) develop, and submit to the National Board for approval, a regional strategic investment plan that meets the requirements of section 385F, with benchmarks, to promote investment in eligible areas through the use of grants made available under this subtitle;

‘‘(C) implement the approved regional plan;

‘‘(D) provide annual reports to the Secretary and the National Board on progress made in achieving the benchmarks of the regional plan, including an annual financial statement; and

‘‘(E) select a non-Federal organization (such as a regional development organization) in the local area served by the Regional Board that has previous experience in the management of Federal funds to serve as fiscal manager of any funds of the Regional Board.

‘‘SEC. 385D. NATIONAL BOARD ON RURAL AMERICA.

‘‘(a) ESTABLISHMENT.—

‘‘(1) IN GENERAL.—The Secretary shall establish a National Board on Rural America to carry out the rural strategic investment program established under this subtitle.

‘‘(2) SUPERVISION AND DIRECTION.—Except as otherwise provided in this subtitle, the National Board shall be subject to the general supervision and direction of the Secretary.

‘‘(b) COMPOSITION.—

‘‘(1) IN GENERAL.—

‘‘(A) APPOINTMENT.—In addition to the Secretary or the designee of the Secretary, the National Board shall consist

of 14 members appointed by the Secretary from among—

‘‘(i) representatives of nationally recognized entrepreneurship organizations;

‘‘(ii) representatives of regional planning and development organizations;

‘‘(iii) representatives of community-based organizations; ‘

‘(iv) elected members of county governments;

            ‘‘(v) elected members of State legislatures;

           ‘‘(vi) representatives of the rural philanthropic community; and

          ‘‘(vii) representatives of Indian tribes (as defined in section 4 of the Indian Self-Determination and Education Assistance Act (25 U.S.C. 450b)).

‘‘(B) RECOMMENDATIONS.—In appointing the members of the National Board under subparagraph (A), the Secretary shall consider recommendations made by—

‘‘(i) the chairman and ranking member of each of the Committee on Agriculture of the House of Representatives and the Committee on Agriculture, Nutrition, and Forestry of the Senate;

‘‘(ii) the Majority Leader of the Senate; and ‘‘(iii) the Speaker of the House of Representatives.

‘‘(3) TERM OF OFFICE.—

‘‘(A) IN GENERAL.—Subject to subparagraph (B), the term of office of a member of the National Board appointed under paragraph (1)(A) shall be 4 years.

‘‘(B) STAGGERED INITIAL TERMS.—Of the initial members of the National Board appointed under paragraph (1)(A), the term of office of—

‘‘(i) 5 members shall be 4 years;

‘‘(ii) 5 members shall be 3 years; and

‘‘(iii) 4 members shall be 2 years.

‘‘(4) INITIAL APPOINTMENTS.—Not later than 90 days after the date of enactment of this subtitle, the Secretary shall appoint the initial members of the National Board under paragraph (1)(A).

‘‘(5) EX-OFFICIO MEMBERS.—

‘‘(A) SPECIAL ASSISTANT TO THE PRESIDENT FOR RURAL POLICY.—If appointed by the President under section 6406(1) of the Farm Security and Rural Investment Act of 2002, the Special Assistant to the President for Rural Policy shall serve as an ex-officio, non-voting member of the National Board.

‘‘(B) OTHER MEMBERS.—In consultation with the chairman and ranking member of each of the Committee on Agriculture of the House of Representatives and the Committee on Agriculture, Nutrition, and Forestry of the Senate, the Secretary may appoint not more than 3 other officers or employees of the Executive Branch to serve as exofficio,non-voting members of the National Board.

‘‘(6) VACANCIES.—A vacancy on the National Board shall be filled in the same manner as the original appointment.

‘‘(7) COMPENSATION.—A member of the National Board shall receive no compensation for service on the National Board, but shall be reimbursed for travel and other expenses incurred in carrying out the duties of the member of the National Board in accordance with section 5702 and 5703 of title 5, United States Code.

‘‘(8) CHAIRPERSON.—The National Board shall select a chairperson from among the members of the National Board.

‘‘(9) MEETINGS.—

‘‘(A) TIME AND PLACE.—The National Board shall meet at the call of the chairperson.

‘‘(B) QUORUM.—A quorum of the National Board shall consist of a majority of the members.

‘‘(C) MAJORITY VOTE.—A decision of the National Board shall be made by majority vote.

‘‘(10) FEDERAL STATUS.—For purposes of Federal law, a member of the National Board shall be considered a special Government employee (as defined in section 202(a) of title 18, United States Code).

‘‘(11) CONFLICT OF INTEREST.—

‘‘(A) IN GENERAL.—Except as provided in subparagraph (C), no member of the National Board shall vote on any matter respecting any  application for a grant or other particular matter pending before the National Board in which, to the knowledge of the member, the member, spouse, or child of the member, partner, or organization in which the member is serving as officer, director, trustee, partner, or employee, or any person or organization with whom the member is negotiating or has any arrangement concerning prospective employment, has a financial interest.

‘‘(B) VIOLATIONS.—A violation of subparagraph (A) by a member of the National Board shall be cause for removal of the member, but shall not impair or otherwise affect the validity of any otherwise lawful action by the National Board in which the member participated.

 ‘‘(C) EXCEPTION.—Subparagraph (A) shall not apply to the extent a member of the National Board advises the National Board of the nature of the particular matter in which the member proposes to participate, if—

‘‘(i) the member makes a full disclosure of the financial interest; and

‘‘(ii) prior to any participation by the member, the National Board determines, by majority vote of the other members of the National Board, that the financial interest is too remote or too inconsequential to affect the integrity of the services of the member to the National Board in that matter.

‘‘(c) ADMINISTRATIVE SUPPORT.—The Secretary, on a reimbursable basis, may provide such administrative support to the National Board as the Secretary determines is necessary to carry out the duties of the National Board.

‘‘(d) DUTIES.—The National Board shall—

‘‘(1) certify Regional Boards in accordance with section 385C, with the initial certification of Regional Boards occurring not later than 540 days after the date of enactment of this subtitle;

‘‘(2) approve, negotiate, or disapprove each regional plan that is submitted by a Regional Board to the National Board under section 385C;

‘‘(3) develop, and submit to the Secretary for approval, a national strategic investment plan;

‘‘(4) use the amount received from the Secretary under section 385E to make planning grants and innovation grants to Regional Boards and to otherwise carry out the program;

‘‘(5) provide leadership and advice to Regional Boards on issues, best practices, and emerging trends relating to rural development;

‘‘(6) evaluate the progress of each Regional Board in achieving the benchmarks of the regional plan using annual reports submitted under section 385C(b)(3)(D) and any other information that is available to the Regional Board; and

‘‘(7) submit an annual report on the performance of Regional Boards and the program to—

‘‘(A) the Committee on Agriculture of the House of Representatives;

‘‘(B) the Committee on Agriculture, Nutrition, and Forestry of the Senate; and

‘‘(C) the Secretary.

‘‘SEC. 385E. RURAL STRATEGIC INVESTMENT PROGRAM.

‘‘(a) IN GENERAL.—If the Secretary approves a national strategic investment plan submitted by the National Board, of the funds of the Commodity Credit Corporation, the Secretary shall transfer to the National Board $100,000,000, to remain available until expended, for the Board to use to make planning grants and innovation grants to Regional Boards and to otherwise carry out this subtitle.

‘‘(b) USE BY NATIONAL BOARD.—Of the amount transferred by the Secretary to the National Board under subsection (a), the National Board shall use—

‘‘(1) not less than $8,000,000 to make planning grants to Regional Boards under section 385F;

‘‘(2) not less than $87,000,000 to make innovation grants to Regional Boards under section 385G; and

‘‘(3) the remainder of the funds to carry out section 385H and administer this subtitle (other than section 385H).

‘‘SEC. 385F. REGIONAL STRATEGIC INVESTMENT PLANNING GRANTS.

‘‘(a) IN GENERAL.—The National Board shall use amounts made available under section 385E(b)(1) to make not fewer than 80 planning grants, on a competitive basis, to applicant Regional Boards to develop, maintain, evaluate, and report progress on regional strategic investment plans in accordance with section 385C and this section.

‘‘(b) REGIONAL PLANS.—A regional plan for a region covered by a Regional Board shall, to the maximum extent practicable, cover—

‘‘(1) basic infrastructure needs of the region;

‘‘(2) basic services within the region;

‘‘(3) opportunities for economic diversification and innovation within the region, with particular attention to entrepreneurial support and innovation;

‘‘(4) the current and future human resource capacity of the region;

‘‘(5) access to market-based financing and venture and equity capital in the region;

‘‘(6) the development of innovative public and private collaborations for investments in the region; and

‘‘(7) other appropriate matters, as determined by the National Board and the Secretary.

‘‘(c) PREFERENCES.—In awarding planning grants, the National Board shall give a preference to planning grants that will be used to address community capacity building and community sustainability.

‘‘(d) AMOUNT.—The total amount of a planning grant made to a Regional Board shall not exceed $100,000.

‘‘(e) COST SHARING.—

‘‘(1) IN GENERAL.—Subject to paragraphs (2) and (3), the share of the costs of developing, maintaining, evaluating, and reporting on a regional plan funded by a grant under this section shall not exceed 50 percent.

‘‘(2) FORM.—

‘‘(A) IN GENERAL. Except as provided in subparagraph (B), a Regional Board shall pay the grantee share of the costs described in paragraph (1) in the form of cash, services, materials, or other in-kind contributions.

‘‘(B) LIMITATION.—A grantee shall not pay more than 50 percent of the grantee share in the form of services, materials, or other in-kind contributions.

‘‘(3) INCREASED SHARE.—The National Board may increase the share of the costs covered by a planning grant made to a Regional Board under this section if a limited ability of the Regional Board to pay would otherwise create a barrier to full participation in the program.

 ‘‘SEC. 385G. INNOVATION GRANTS.

‘‘(a) IN GENERAL.—The National Board shall use amounts made available under section 385E(b)(2) to make innovation grants, on a competitive basis, to Regional Boards to implement projects that are identified in the regional plans of the Regional Boards.

‘‘(b) ELIGIBILITY.—

‘‘(1) IN GENERAL.—For a Regional Board to be eligible to receive an innovation grant, the National Board shall determine that—

‘‘(A) the regional plan of a Regional Board meets the requirements of this subtitle;

‘‘(B) the management and organizational structure of the Regional Board is sufficient to oversee grant projects;

‘‘(C) the Regional Board will be able to provide the grantee share required under this section; and

‘‘(D) the Regional Board agrees to achieve, to the maximum extent practicable, the performance-based benchmarks of the regional plan.

‘‘(2) RELATIONSHIP TO PLANNING GRANTS.—A Regional Board that meets the requirements of paragraph (1) shall be eligible to receive an innovation grant, regardless of whether the Regional Board receives a planning grant.

‘‘(c) SELECTION.—Subject to subsection (d), of the applications submitted by Regional Boards for innovation grants, the National Board shall, to the maximum extent practicable, select not fewer than 30 regional boards to receive innovation grants.

‘‘(d) PREFERENCES.—In awarding innovation grants, the National Board shall give a preference (in order of priority) to Regional Boards that—

‘‘(1) exhibit collaborative innovation and entrepreneurship, particularly within a public-private partnership;

‘‘(2) represent a broad coalition of interests described in section 385C(b)(2)(A);

‘‘(3) demonstrate a plan to leverage public (Federal and non-federal) and private funds and existing assets, including natural assets and public infrastructure;

‘‘(4) address gaps in existing basic services within a region;

‘‘(5) address economic diversification, including agricultural and non-agriculturally based economies, within a regional framework;

‘‘(6) demonstrate a plan to achieve multijurisdictional regional planning and development, with particular evidence of economic development successes within diverse stakeholder frameworks; or

‘‘(7) meet other community development needs identified by a Regional Board.

‘‘(e) USES.—

‘‘(1) LEVERAGE.—A Regional Board shall prioritize projects, in part, on the degree to which the Regional Board is able to leverage additional funds for the implementation of the projects.

‘‘(2) PURPOSES.—A Regional Board may use an innovation grant provided for a region—

 ‘‘(A) to support the development of critical infrastructure necessary to facilitate economic development in the region;

‘‘(B) to provide assistance to entities within the region that provide basic public services;

‘‘(C) to assist with job training, workforce development, or other needs related to the development and maintenance of strong local and regional economies;

‘‘(D) to assist in the development of unique new collaborations that link public, private, and philanthropic resources to achieve collaboratively designed regional advancement; and

‘‘(E) to provide support to business investment.

‘‘(3) OTHER DEPARTMENT PROGRAMS.—A Regional Board may not use an innovation grant provided for a region for any purpose for which funding may be obtained under any other rural development program of the Department of Agriculture unless—

‘‘(A) the Regional Board—

‘‘(i) has submitted an application for the funding under the other program; and

‘‘(ii) withdraws the application; and

‘‘(B) the National Board approves use of the innovation grant for that purpose.

‘‘(4) OPERATING EXPENSES.—A Regional Board may use for administrative costs in carrying out programs and activities related

to the grant the greater of—

‘‘(A) $100,000; or

‘‘(B) 5 percent of the amount of an innovation grant provided.

‘‘(f) AMOUNT.—

‘‘(1) IN GENERAL.—The amount of an innovation grant made to a Regional Board shall not exceed $3,000,000.

‘‘(2) AVAILABILITY.—The amount of an innovation grant made to a Regional Board shall remain available until expended.

‘‘(g) COST SHARING.—

‘‘(1) IN GENERAL.—Subject to paragraphs (2) and (3), the share of the costs of projects covered by an innovation grant made to a Regional Board under this section shall not exceed 75 percent, as determined by the National Board.

‘‘(2) FORM.—A Regional Board may pay the grantee share of the costs of projects covered by an innovation grant in the form of cash or services, materials, or other in-kind contributions.

‘‘(3) WAIVER OF GRANTEE SHARE.—The National Board may waive the grantee share of the costs of projects covered by an innovation grant made to a Regional Board under this section if the National Board determines that such a waiver is appropriate.

‘‘(4) OTHER FEDERAL PROGRAMS.—For the purpose of determining grantee share requirements for any other Federal programs, funds provided for innovation grants shall be considered to be non-Federal funds.

‘‘(h) NEGOTIATION.—The National Board may—

‘‘(1) negotiate with a Regional Board on the substance, size, and scope of a regional plan; and

‘‘(2) approve an innovation grant for an amount that is lower than the amount requested by the Regional Board.

‘‘(i) NONCOMPLIANCE.—If a Regional Board fails to comply with the requirements of this section, the National Board may take such actions as are necessary to obtain reimbursement of unused grant funds.

‘‘(j) OTHER USES.—The National Board may use not more than 5 percent of the amounts made available for innovation grants—

‘‘(1) to provide assistance to interests described in section 385C(b)(2)(A) to obtain certification of a Regional Board;

‘‘(2) to provide assistance for emergent innovative opportunities that are not covered by existing regional plans;

‘‘(3) to provide technical assistance, research, organizational support, and other capacity building infrastructure to support existing Regional Boards;

‘‘(4) to provide assistance for other entrepreneurial opportunities to advance the goals of the program; or

‘‘(5) to advance a more integrative rural policy framework for the United States.

‘‘(k) TRANSFERS.—To ensure maximum use of funds provided under this subtitle, the National Board may transfer not more than 10 percent of the amount of funds made available between planning grants and innovation grants.

‘‘SEC. 385H. NATIONAL CONFERENCE ON RURAL AMERICA.

‘‘(a) IN GENERAL.—The President shall call and conduct a National Conference on Rural America, which shall be held not earlier than November 1, 2002, and not later than October 30, 2004.

‘‘(b) PURPOSE.—The purpose of the Conference shall be to bring together the resources of governmental agencies and the private and nonprofit sectors to develop—

‘‘(1) policy recommendations and integrative strategies for addressing the unique challenges facing rural areas of the United States; and

‘‘(2) an implementation plan, with outcome-based measurements, for addressing the challenges.

‘‘(c) COMPOSITION.—

‘‘(1) IN GENERAL.—The Conference shall be comprised of—

‘‘(A) representatives of organizations devoted to rural development;

‘‘(B) Members of Congress, including the chairman and ranking member of each of the Committee on Agriculture of the House of Representatives and the Committee on Agriculture, Nutrition, and Forestry of the Senate;

‘‘(C) representatives of the Department of Agriculture and other Federal agencies;

‘‘(D) State, local, and tribal elected officials and representatives;

‘‘(E) representatives of colleges and universities, State and tribal extension services, and State rural development councils; and

‘‘(F) individuals with specialized knowledge of and expertise in rural and community development, cooperative business, agricultural credit, venture capital, health care, and rural demography.

‘‘(2) SELECTION.—Of the participants in the Conference described in paragraph (1)—

‘‘(A) 1/3 of the members shall be selected by the President;

‘‘(B) 1/3 of the members shall be selected by the Chairman and the ranking member of the Committee on Agriculture of the House of Representatives; and

‘‘(C) 1/3 of the members shall be selected by the Chairman and the ranking member of the Committee on Agriculture, Nutrition, and Forestry of the Senate.

‘‘(3) REPRESENTATION.—In selecting the participants of the Conference, the President and the Chairman of each Committee referred to in paragraph (2) shall ensure, to the maximum extent practicable, that the  participants are representative of the ethnic, racial, and linguistic diversity of rural areas of the United States.

‘‘(d) REPORT.—

‘‘(1) REPORT TO PRESIDENT.—Not later than 120 days after the termination of the Conference, the Conference shall submit to the President a report that contains the findings and recommendations of the Conference, including findings and recommendations to address needs related to—

‘‘(A) telecommunications;

‘‘(B) rural health issues;

‘‘(C) transportation;

‘‘(D) opportunities for economic diversification and innovation within rural America, with particular attention to entrepreneurial support and innovation;

‘‘(E) the current and future human resource capacity of rural America;

‘‘(F) access to market-based financing and venture and equity capital in rural America; and

‘‘(G) the development of innovative public and private collaborations for investments in rural America.

‘‘(2) REPORT MADE PUBLIC AND TO CONGRESS.—Not later than 90 days after receipt by the President, the President shall—

‘‘(A) make the report public; and

‘‘(B) transmit to the Committee on Agriculture of the House of Representatives and the Committee on Agriculture, Nutrition, and Forestry of the Senate a copy of the report and a statement of the President containing recommendations for implementing the report.

‘‘(3) PUBLICATION AND DISTRIBUTION.—

‘‘(A) IN GENERAL.—The Conference shall publish and distribute the report described in paragraph (1).

‘‘(B) MANDATORY DISTRIBUTION.—The Conference shall provide a copy of a report published under subparagraph

(A), at no cost, to—

‘‘(i) each Federal depository library; and

‘‘(ii) on request, each State, tribal, and local elected official in a rural area of the United States.

‘‘(e) FUNDING.—Not later than 180 days after the establishment of the National Board, the National Board shall transfer not more than $2,000,000 to the Office of the President to carry out this section, to remain available until expended.’’.