WASHINGTON -- The Clinton Administration's target date for naming the 104 winners of the competition to be designated enterprise zones has slipped until the end of this year.
The delay, which is the second this year, was revealed when administration officials said earlier this week that 519 communities had applied for zone status by the June 30 deadline.
In March, White House officials said they hoped to make their announcement by October or November. In February, they said they were shooting for August.
The delays in naming the zones will translate into a corresponding lag in the first bond issuance under the new program, municipal lobbyists said. Bonds probably will not be issued before next spring they said.
The 104 enterprise zones to be selected will comprise nine empowerment zones, with a wide array of benefits, and 95 enterprise communities, with a narrower range of benefits. Both types will be eligible to issue a new category of tax-exempt bond to fund zone businesses.
Of the total, six empowerment zones and 65 enterprise communities will be in urban areas and will be selected by the Department of Housing and Urban Development The others will be in rural areas and will be designated by the Department of Agriculture.
In announcing the 519 applicants on Tuesday, HUD officials said 78 urban and 88 rural areas applied for designation as empowerment zones. In addition, 214 urban areas and 139 rural areas applied to become enterprise communities.
Lobbyists have said that, for political reasons, several choices for empowerment zones are probably preordained: New York City, Los Angeles, and Chicago are the names mentioned most often. In addition, the wording of the enterprise zone law suggests that one of the zones must be located somewhere in Texas and another in the area containing Philadelphia and nearby Camden, N.J.
HUD said in a statement that in terms of federal grants, enterprise communities "will receive essentially the same services as empowerment zones, but on a smaller scale." For example, urban empowerment zones will each receive up to $100 million in federal Social Services Block Grants, and rural empowerment zones will receive $40 million each, but enterprise communities will be given only $3 million each.
The new type of bond to be issued in the zones is an exempt-facility bond that is subject to the private-activity bond volume cap. The amount that can be issued for a business in any one zone is capped at $3 million. The limit that any one business can use is $20 million.
The enterprise zones were approved as part of the tax package enacted in August 1993. In drafting the legislation, lawmakers had considered partially exempting the bonds from the volume cap and making them bank deductible, but the proposals were eliminated from the final version of the enterprise zone bill that became law.