text: SECTION 1. SHORT TITLE.
  
      This Act may be cited as the ``Educational Empowerment Act''.
  
  SEC. 2. DESIGNATION OF EDUCATIONAL EMPOWERMENT ZONES.
  
      (a) In General.--Chapter 1 of the Internal Revenue Code of 1986 is 
  amended by adding at the end the following new subchapter:
  
               ``Subchapter X--Educational Empowerment Zones
  
                                ``Sec. 1400E. Designation of educational 
                                          empowerment zones.
  
  ``SEC. 1400E. DESIGNATION OF EDUCATIONAL EMPOWERMENT ZONES.
  
      ``(a) Designation.--
              ``(1) Educational empowerment zone.--For purposes of this 
          title, the term `educational empowerment zone' means any area--
                      ``(A) which is nominated by one or more local 
                  governments and the State or States in which it is 
                  located for designation as an educational empowerment 
                  zone (hereinafter in this section referred to as a 
                  `nominated area'), and
                      ``(B) which the Secretary of Health and Human 
                  Services and the Secretary of Education (hereinafter in 
                  this section referred to as the `Secretaries 
                  concerned') jointly designate as an educational 
                  empowerment zone.
              ``(2) Number of designations.--The Secretaries concerned 
          may designate not more than 30 nominated areas as educational 
          empowerment zones.
              ``(3) Areas designated based on degree of poverty, etc.--
          Except as otherwise provided in this section, the nominated 
          areas designated as educational empowerment zones under this 
          subsection shall be those nominated areas with the highest 
          average ranking with respect to the criteria described in 
          subsection (c)(3). For purposes of the preceding sentence, an 
          area shall be ranked within each such criterion on the basis of 
          the amount by which the area exceeds such criterion, with the 
          area which exceeds such criterion by the greatest amount given 
          the highest ranking.
              ``(4) Limitation on designations.--
                      ``(A) Publication of regulations.--The Secretaries 
                  concerned shall prescribe by regulation no later than 4 
                  months after the date of the enactment of this 
                  section--
                              ``(i) the procedures for nominating an area 
                          under paragraph (1)(A),
                              ``(ii) the parameters relating to the size 
                          and population characteristics of an 
                          educational empowerment zone, and
                              ``(iii) the manner in which nominated areas 
                          will be evaluated based on the criteria 
                          specified in subsection (c).
                      ``(B) Time limitations.--The Secretaries concerned 
                  may designate nominated areas as educational 
                  empowerment zones only during the 24-month period 
                  beginning on the first day of the first month following 
                  the month in which the regulations described in 
                  subparagraph (A) are prescribed.
                      ``(C) Procedural rules.--The Secretaries concerned 
                  shall not make any designation of a nominated area as 
                  an educational empowerment zone under paragraph (2) 
                  unless--
                              ``(i) a nomination regarding such area is 
                          submitted in such a manner and in such form, 
                          and contains such information, as the 
                          Secretaries concerned shall by regulation 
                          prescribe, and
                              ``(ii) the Secretaries concerned determine 
                          that any information furnished is reasonably 
                          accurate.
              ``(5) Nomination process for indian reservations.--For 
          purposes of this subchapter, in the case of a nominated area on 
          an Indian reservation, the reservation governing body (as 
          determined by the Secretary of the Interior) shall be treated 
          as being both the State and local governments with respect to 
          such area.
      ``(b) Period for Which Designation Is in Effect.--Any designation 
  of an area as an educational empowerment zone shall remain in effect 
  during the period beginning on the date of the designation and ending 
  on the earliest of--
              ``(1) December 31, 2005,
              ``(2) the termination date designated by the State and 
          local governments in their nomination, or
              ``(3) the date the Secretaries concerned revoke such 
          designation.
      ``(c) Area and Eligibility Requirements.--
              ``(1) In general.--The Secretary of Commerce may designate 
          a nominated area as an educational empowerment zone under 
          subsection (a) only if the area meets the requirements of 
          paragraphs (2) and (3) of this subsection.
              ``(2) Area requirements.--For purposes of paragraph (1), a 
          nominated area meets the requirements of this paragraph if--
                      ``(A) the area is within the jurisdiction of one or 
                  more local governments,
                              ``(B) the boundary of the area is 
                          continuous, and
                              ``(C) the area does not include an 
                          empowerment zone (as defined in section 
                          1393(b)) other than such a zone designated 
                          under section 1391(g).
              ``(3) Eligibility requirements.--For purposes of paragraph 
          (1), a nominated area meets the requirements of this paragraph 
          if the State and the local governments in which it is located 
          certify that the nominated area satisfies such conditions as 
          the Secretary of Education deems appropriate.
              ``(4) Consideration of dropout rate, etc.--The Secretary of 
          Education, in setting forth the conditions for eligibility 
          pursuant to paragraph (3), shall take into account the extent 
          to which an area has low-income families, a high dropout rate, 
          a high rate of teen pregnancy, and large school class sizes.
      ``(d) Coordination With Treatment of Enterprise Communities.--For 
  purposes of this title, if there are in effect with respect to the same 
  area both--
              ``(1) a designation as an educational empowerment zone, and
              ``(2) a designation as an enterprise community,
  both of such designations shall be given full effect with respect to 
  such area.
      ``(e) Definitions and Special Rules.--For purposes of this 
  subchapter, rules similar to the rules of paragraphs (2), (3), (5), and 
  (7) of section 1393 shall apply.''.
      (b) Clerical Amendment.--The table of subchapters for chapter 1 is 
  amended by adding at the end the following new item:
  
                                ``Subchapter X. Educational Empowerment 
                                          Zones.''
  
  SEC. 3. CREDIT FOR DONATIONS TO SCHOOL DISTRICTS IN EDUCATIONAL 
                EMPOWERMENT ZONES.
  
      (a) In General.--Subpart B of part IV of subchapter A of chapter 1 
  of the Internal Revenue Code of 1986 is amended by inserting after 
  section 30A the following new section:
  
  ``SEC. 30B. CONTRIBUTIONS TO SCHOOL DISTRICTS IN EDUCATIONAL 
                EMPOWERMENT ZONES.
  
      ``(a) Allowance of Credit.--There shall be allowed as a credit 
  against the tax imposed by this chapter for the taxable year an amount 
  equal to the amount of qualified educational empowerment zone 
  contributions made by the taxpayer during such year.
      ``(b) Maximum Credit.--The amount of the credit allowed by 
  subsection (a)--
              ``(1) in the case of an individual, shall not exceed 
          $2,000, and
              ``(2) in the case of any other taxpayer, shall not exceed 
          $10,000.
      ``(c) Definition of Qualified Educational Empowerment Zone 
  Contributions.--For purposes of this section, the term `qualified 
  educational empowerment zone contributions' means cash contributions 
  made to any school district located in an educational empowerment zone 
  (as designated under section 1400E) if such contributions--
              ``(1) but for subsection (d), would be allowable as a 
          deduction under section 170, and
              ``(2) are used for any of the following purposes by the 
          school district:
                      ``(A) Hiring new teachers.
                      ``(B) Increasing teacher salaries.
                      ``(C) Training teachers.
      ``(d) Denial of Double Benefit.--No deduction shall be allowed 
  under this chapter for any contribution taken into account in computing 
  the credit under this section.
      ``(e) Election.--This section shall apply to any taxpayer for any 
  taxable year only if such taxpayer elects (at such time and in such 
  manner as the Secretary may by regulations prescribe) to have this 
  section apply for such taxable year.
      ``(f) Application With Other Credits; Carryover of Excess Credit.--
  The credit allowed by subsection (a) for any taxable year shall not 
  exceed the excess (if any) of--
              ``(1) the regular tax for the taxable year reduced by the 
          sum of the credits allowable under subpart A and the preceding 
          sections of this subpart, over
              ``(2) the tentative minimum tax for the taxable year.
  If the credit under subsection (a) exceeds the limitation of the 
  preceding sentence, such excess shall be added to the credit allowable 
  under subsection (a) for the succeeding taxable year.''.
      (b) Clerical Amendment.--The table of sections for subpart B of 
  part IV of subchapter A of chapter 1 of such Code is amended by 
  inserting after the item relating to section 30A the following new 
  item:
  
                                ``Sec. 30B. Contributions to school 
                                          districts in educational 
                                          empowerment zones.''
      (c) Effective Date.--The amendments made by this section shall 
  apply to taxable years beginning after December 31, 2000.
  
  SEC. 4. TEACHER LOAN FORGIVENESS PROGRAM.
  
      Part B of title IV of the Higher Education Act of 1965 is amended 
  by inserting after section 428K (20 U.S.C. 1078-11) the following new 
  section:
  
  ``SEC. 428L. LOAN FORGIVENESS FOR MATHEMATICS AND SCIENCE TEACHERS.
  
      ``(a) Purpose.--It is the purpose of this section to encourage more 
  individuals to enter and stay in the field of teaching mathematics, 
  science, and related fields.
      ``(b) Program.--
              ``(1) In general.--The Secretary shall carry out a program 
          of assuming the obligation to repay, pursuant to subsection 
          (c), a loan made, insured, or guaranteed under this part or 
          part D (excluding loans made under sections 428B and 428C or 
          comparable loans made under part D) for any new borrower after 
          October 1, 1998, who--
                      ``(A) has been employed as a full-time teacher for 
                  3 consecutive complete school years in a school that is 
                  located in an educational empowerment zone, as such 
                  term is defined in section 1400E of the Internal 
                  Revenue Code of 1986;
                      ``(B) is a fully qualified teacher; and
                      ``(C) is not in default on a loan for which the 
                  borrower seeks forgiveness.
              ``(2) Award basis; priority.--
                      ``(A) Award basis.--Subject to subparagraph (B), 
                  loan repayment under this section shall be on a first-
                  come, first-served basis and subject to the 
                  availability of appropriations.
                      ``(B) Priority.--The Secretary shall give priority 
                  in providing loan repayment under this section for a 
                  fiscal year to student borrowers who received loan 
                  repayment under this section for the preceding fiscal 
                  year.
              ``(3) Regulations.--The Secretary is authorized to 
          prescribe such regulations as may be necessary to carry out the 
          provisions of this section.
      ``(c) Loan Repayment.--
              ``(1) Eligible amount.--The amount the Secretary may repay 
          on behalf of any individual under this section shall not 
          exceed--
                      ``(A) 80 percent of the sum of the principal 
                  amounts outstanding of the individual's qualifying 
                  loans at the end of 3 consecutive complete school years 
                  of service described in subsection (b)(1)(A);
                      ``(B) an additional 10 percent of such sum at the 
                  end of each of the next 2 consecutive complete school 
                  years of such service; and
                      ``(C) a total of more than $10,000.
              ``(2) Construction.--Nothing in this section shall be 
          construed to authorize the refunding of any repayment of a loan 
          made under this part or part D.
              ``(3) Interest.--If a portion of a loan is repaid by the 
          Secretary under this section for any year, the proportionate 
          amount of interest on such loan which accrues for such year 
          shall be repaid by the Secretary.
              ``(4) Double benefits prohibited.--No borrower may, for the 
          same service, receive a benefit under both this section and 
          subtitle D of title I of the National and Community Service Act 
          of 1990 (42 U.S.C. 12601 et seq.). No borrower may receive a 
          reduction of loan obligations under both this section and 
          section 428J or 460.
      ``(d) Repayment to Eligible Lenders.--The Secretary shall pay to 
  each eligible lender or holder for each fiscal year an amount equal to 
  the aggregate amount of loans which are subject to repayment pursuant 
  to this section for such year.
      ``(e) Application for Repayment.--
              ``(1) In general.--Each eligible individual desiring loan 
          repayment under this section shall submit a complete and 
          accurate application to the Secretary at such time, in such 
          manner, and containing such information as the Secretary may 
          require.
              ``(2) Conditions.--An eligible individual may apply for 
          loan repayment under this section after completing the required 
          number of years of qualifying employment.
              ``(3) Fully qualified teachers.--An application for loan 
          repayment under this section shall include such information as 
          is necessary to demonstrate that the applicant--
                      ``(A) if teaching in a public elementary or 
                  secondary school (other than as a teacher in a public 
                  charter school), has obtained State certification as a 
                  teacher (including certification obtained through 
                  alternative routes to certification) or passed the 
                  State teacher licensing exam and holds a license to 
                  teach in such State; and
                      ``(B) if teaching in--
                              ``(i) an elementary school, holds a 
                          bachelor's degree and demonstrates knowledge 
                          and teaching skills in reading, writing, 
                          mathematics, science, and other areas of the 
                          elementary school curriculum; or
                              ``(ii) a middle or secondary school, holds 
                          a bachelor's degree and demonstrates a high 
                          level of competency in all subject areas in 
                          which he or she teaches through--
                                      ``(I) a high level of performance 
                                  on a rigorous State or local academic 
                                  subject areas test; or
                                      ``(II) completion of an academic 
                                  major in each of the subject areas in 
                                  which he or she provides instruction.
      ``(f) Evaluation.--
              ``(1) In general.--The Secretary shall conduct, by grant or 
          contract, an independent national evaluation of the impact of 
          the program assisted under this section.
              ``(2) Competitive basis.--The grant or contract described 
          in subsection (b) shall be awarded on a competitive basis.
              ``(3) Contents.--The evaluation described in this 
          subsection shall--
                      ``(A) determine the number of individuals who were 
                  encouraged by the program assisted under this section 
                  to pursue teaching careers;
                      ``(B) determine the number of individuals who 
                  remain employed in teaching mathematics, science, or 
                  related fields as a result of participation in the 
                  program;
                      ``(C) identify the barriers to the effectiveness of 
                  the program;
                      ``(D) assess the cost-effectiveness of the program; 
                  and
                      ``(E) identify the number of years each individual 
                  participates in the program.
              ``(4) Interim and final evaluation reports.--The Secretary 
          shall prepare and submit to the President and the Congress such 
          interim reports regarding the evaluation described in this 
          subsection as the Secretary deems appropriate, and shall 
          prepare and so submit a final report regarding the evaluation 
          by January 1, 2004.''.
target: Establishes a teacher loan forgiveness program for mathematics and science teachers.
feat_title: Educational Empowerment Act