will open up an area or areas with a developmental potential where commerce and communication have been inhibited by lack of adequate access, the Appalachian Regional Commission is authorized to designate, and approve programs and projects for the construction of an Appalachian development highway system and local access roads serving the Appalachian region, and to advance funds therefor to the Secretary of Transportation (hereafter in this section referred to as the 'Secretary'). The Secretary is authorized to assist in the construction of such development highway projects and access roads in accordance with the provisions of title 23, United States Code, that are applicable to the construction and maintenance of Federal-aid primary and secondary highways, and which the Secretary determines are not inconsistent with this Act. Construction on the development highway system shall not exceed two thousand seven hundred miles. In addition thereto, there are authorized to be constructed not in excess of two thousand miles of local access roads, that will serve specific recreational, residential, educational, commercial, industrial, or other like facilities or will facilitate a school consolidation program.

"(b) The Commission shall transmit to the Secretary its designations of (1) the general corridor location and termini of the development highways, (2) local access roads to be constructed, (3) priorities for the construction of major segments of the development highways, and (4) other criteria for the program authorized by this section. Before any State member participates in or votes on such designations, he shall have obtained the recommendations of the State highway department of the State which he represents.

(c) In no event shall the Commission approve any recommendations for any construction which would require for its completion the expenditure of Federal funds (other than funds available under title 23, United States Code) in excess of the appropriations authorization in subsection (g). On its completion each development highway not already on the Federal-aid primary system shall be added to such system and each development highway and local access road shall be required to be maintained by the State as provided for Federal-aid highways in title 23, United States Code.

"(d) In the construction of highways and roads authorized under this section, the States may give special preference to the use of mineral resource materials indigenous to the Appalachian region.

"(e) For the purposes of research and development in the use of coal and coal products in highway construction and maintenance, the Secretary is authorized to require each participating State, to the maximum extent possible, to use coal derivatives in the construction of not to exceed 10 per centum of the roads authorized under this Act.

"(f) Federal assistance to any construction project under this section shall not exceed 50 per centum of the costs of such project, unless the Commission determines that assistance in excess of such percentage is required in furtherance of the purposes of this Act, but in no event shall such Federal assistance exceed 70 per centum of such costs.

"(g) To carry out this section, there is hereby authorized to be appropriated to the Commission, to be available until expended, the sum of $110,000,000 for the fiscal year ending June 30, 1968; the sum of $255,000,000 for the fiscal year ending June 30, 1969; the sum of $245,000,000 for the fiscal year ending June 30, 1970; and the sum of $105,000,000 for the fiscal year ending June 30, 1971. Unexpended balances of appropriations to the Secretary of Commerce under the authorization in this section prior to amendment by the Appalachian Regional Development Act Amendments of 1967 shall be treated as having been appropriated to the Commission and advanced to the Secretary under an additional authorization in this section, and shall remain available until expended.

"(h) Funds authorized in this section shall be allocated to the member States by the Commission on a date not later than the first day of the fiscal year for which authorized and shall be available for expenditure on approved projects upon allocation.

"(i) (1) When a participating State proceeds to construct a segment of a development highway without the aid of Federal funds, in accordance with all procedures and requirements applicable to the construction of segments of Appalachian development highways with such funds, except insofar as such procedures and requirements limit a State to the construction of projects for which Federal funds have previously been appropriated, the Secretary, upon application by the State, is authorized to pay to the State, at such times, in such amounts

and under such terms and conditions as may be approved by the Commission, the Federal share not to exceed 70 per centum of the costs of construction of such segment, from any sums appropriated to carry out this section.

"(2) This subsection shall not be construed as a commitment or obligation on the part of the United States to provide funds for segments of development highways constructed under this subsection, and shall not increase the total amount of construction which the Commission is authorized to approve under subsection (c)."

"SEC. 202. (a) In order to demonstrate the value of adequate health facilities

"DEMONSTRATION HEALTH PROJECTS

"SEC. 202. (a) In order to demonstrate the value of adequate health facilities and services to the economic development of the region, the Commission is authorized to approve programs and projects for demonstration health programs and projects, and to advance funds therefor to the Secretary of Health, Education, and Welfare. Upon receipt of such Commission approval, the Secretary of Health, Education, and Welfare shall make grants for the planning, construction, equipment, and operation of multicounty demonstration health projects, including hospitals, regional health diagnostic and treatment centers, and other facilities and services necessary to health. Grants for such construction (including the acquisition of facilities and initial equipment) shall be made in accordance with the applicable provisions of title VI of the Public Health Service Act (72 U.S.C. 291-2910), the Mental Retardation Facilities and Community Mental Health Centers Construction Act of 1963 (77 Stat. 282), and other laws authorizing grants for the construction of health-related facilities, without regard to any provisions therein relating to appropriation authorization ceilings or to allotments among the States. Grants under this section shall be made solely out of funds specifically appropriated for the purpose of carrying out this Act and shall not be taken into account in the computation of the allotments among the States made pursuant to any other provision of law.

"(b) No grant for the construction or equipment of any component of a demonstration health project shall exceed 80 per centum of such costs. The Federal contribution may be provided entirely from funds authorized under this section or in combination with funds provided under other Federal grant-in-aid programs for the construction or equipment of health-related facilities. Notwithstanding section 104 of the Public Works and Economic Development Act of 1965 (79 Stat. 554), or any other provision of law, funds authorized under this section may be used to increase Federal grants for component facilities of a demonstration health project above the maximum portion of the costs of such facilities otherwise authorized by the applicable laws.

"(c) Grants under this section for operation (including initial operating funds and operating deficits comprising among other items the costs of attracting, training, and retaining qualified personnel) of a demonstration health project, whether or not constructed with funds authorized by this section, may be made for up to 100 per centum of the costs thereof for the two-year period beginning, for each component facility or service assisted under any such operating grant, on the first day that such facility or service is in operation as a part of the projeet. For the next three years of operations such grants shall not exceed 50 per centum of such costs, No grants for operation of a demonstration health project shall be made after five years following the commencement of the initial grant for operation of the project.

"(d) The Commission is authorized to provide funds for the support of its Health Advisory Committee and to make grants for expenses of planning necessary for the development and operation of demonstration health projects for the region. The amount of any such grant shall not exceed 75 per centum of such expenses.

"(e) Not to exceed $70,000,000 of the funds authorized in section 401 of this Act for the two fiscal-year period ending June 30, 1969, shall be available to carry out this section."

SEC. 8. (a) Subsection (a) of section 203 of the Act is amended to read as follows:

"(a) In order to provide for the control and prevention of erosion and sediment damages in the Appalachian region and to promote the conversation and development of the soil and water resources of the region, the Commission is au

thorized to approve programs and projects for land stabilization conservation and erosion control, and to advance funds therefor, to the Secretary of Agriculture. Upon receipt of such Commission approval, the Secretary of Agriculture shall enter into agreements of not more than ten years with landowners, operators, and occupiers, individually or collectively, in the Appalachian region determined by him to have control for the period of the agreement of the lands described therein, providing for land stabilization, erosion and sediment control, and reclamation through changes in land use, and conservation treatment including the establishment of practices and measures for the conservation and development of soil, water, woodland, wildlife, and recreation resources."

(b) Subsection (i) of such section is amended by inserting after "Act" the following: "for the two-fiscal-year period ending June 30, 1969."

SEC. 9. (a) The portion of subsection (a) of section 204 of the Act preceding clause (1) is amended to read as follows:

"(a) In order that the region shall more fully benefit from the timber stands that are one of its prime assets, the Commission is authorized to approve programs and projects of technical assistance and loans to timber development organizations, and to advance funds therefor, to the Secretary of Agriculture. Upon receipt of such Commission approval, the Secretary of Agriculture shall—”. (b) Subsection (b) of such section is amended to read as follows:

"(b) Not to exceed $4,000,000 of the funds authorized in section 401 of this Act for the two-fiscal-year period ending June 30, 1969, shall be available to carry out this section."

SEC. 10. (a) The portion of subsection (a) of section 205 of the Act preceding paragraph (2) is amended to read as follows:

"(a) In order to further the economic development of the region by rehabilitating areas presently damaged by deleterious mining practices, the Commission is authorized to approve restoration programs and projects, and to advance funds therefor, to the Secretary of the Interior. Upon receipt of such Commission approval, the Secretary of the Interior is authorized to

"(1) make financial contributions to States in the region to seal and fill voids in abandoned coal mines and abandoned oil and gas wells, and to reclaim and rehabilitate lands affected by the strip and surface mining and processing of coal and other minerals, including waste piles, in accordance with provisions of the Act of July 15, 1955 (30 U.S.C. 571 et seq.), to the extent applicable, without regard to section 2(b) thereof (30 U.S.C. 572(b)) or to any provisions therein limiting assistance to anthracite coal formation, or to the Commonwealth of Pennsylvania. Grants under this paragraph shall be made wholly out of funds specifically appropriated for the purposes of carrying out this Act."

(b) Subsection (b) of such section is amended by striking out "and 1967" and inserting in lieu thereof ",1967, 1968, and 1969", and by inserting after "restoration projects" a comma and the following: "including land acquisition costs,".

(c) The first sentence of subsection (d) of such section is amended to read as follows: "Not to exceed $39,150,000 of the funds authorized in section 401 of this Act for the two-fiscal-year period ending June 30, 1969, shall be available to carry out this section."

SEC. 11. Subsection (g) of section 206 of the Act is amended to read as follows: "(g) Not to exceed $2,000,000 of the funds authorized in section 401 of this Act for the two-fiscal-year period ending June 30, 1969, shall be available to carry out this section."

SEC. 12. Part A of title II of the Act is amended by inserting at the end thereof a new section as follows:

"HOUSING PROGRAM INCENTIVES

"SEC. 207. (a) In order to encourage and facilitate the construction of housing to meet the needs of low- and medium-income families and individuals in the Appalachian region, by making possible wider use in the region of section 221 of the National Housing Act, the Commission is authorized to approve programs and projects and to advance funds therefor, to the Secretary of Housing and Urban Development. The Secretary of Housing and Urban Development is authorized to make low-interest and interest-free loans and grants for approved programs and projects, under such terms and conditions as he may require, to private nonprofit corportations or other private nonprofit legal entities, limited dividend corporations or other limited dividend legal entities,

cooperative housing corporations, and public bodies or agencies, both regional and local in scope. These funds shall be used to meet up to 80 per centum of the reasonable costs, including technical services, incidental to the initial planning for, and the construction or rehabilitation of housing in any area of the Appalachian region determined by the Commission to have significant potential for future growth, which costs are reasonably incurred prior to the availability of mortgage or other permanent financing for such housing and in anticipation thereof: Provided, That the Secretary shall require repayment of any funds used for costs subsequently included in a mortgage insured under section 221 of the National Housing Act or for costs which the Secretray determines could reasonably have been included in such mortgage: And provided further, That the non-Federal share of such costs may be in cash, or in kind, fairly evaluated, including but not limited to space, equipment, and services.

"(b) All funds appropriated for the purposes of this section shall, after advance by the Commission, be deposited in a fund which shall be known as the Appalachian Housing Fund and shall be used as a revolving fund by the Secretary of Housing and Urban Development for carrying out the provisions of this section. General expenses of administration of this section may be charged to such fund. Moneys in such fund not needed for current operation may be invested in bonds or other obligations guaranteed as to principal and interest by the United States.

"(c) Not to exceed $5,000,000 of the funds authorized in section 401 of this Act for the two-fiscal-year period ending June 30, 1969, shall be available to carry out this section."

SEC. 13. Section 211 of the Act is amended to read as follows:

"VOCATIONAL EDUCATION FACILITIES

"SEC. 211. (a) In order to provide basic facilities to give the people of the region the training and education they need to obtain employment, the Commission is authorized to approve programs and projects for construction of vocational education facilities, and to advance funds therefor, to the Secretary of Health, Education, and Welfare. Upon receipt of such Commission approval, the Secretary of Health, Education, and Welfare shall make grants for construction and equipment of the school facilities needed in accordance with the provisions of the Vocational Education Act of 1963 (77 Stat. 403), without regard to any provisions therein relating to appropriation authorization ceilings or to allotments among the States. Grants under this section shall be made solely out of funds specifically appropriated for the purpose of carrying out this Act, and shall not be taken into account in the computation of the allotments among the States made pursuant to any other provision of law.

"(b) No to exceed $18,000,000 of the funds authorized in section 401 for the two-fiscal-year period ending June 30, 1969, of this Act shall be available to carry out this section."

SEC. 14. Section 212 of the Act is amended to read as follows:

"SEWAGE TREATMENT WORKS

"SEC. 212. (a) In order to provide facilities to assist in the prevention of pollution of the region's streams and to protect the health and welfare of its citizens, the Commission is authorized to approve programs and projects for the construction of sewage treatment works, and to advance funds therefor to the Secretary of the Interior. Upon receipt of such Commission approval, the Secretary of the Interior shall make construction grants in accordance with the provisions of the Federal Water Pollution Control Act (33 U.S.C. 466 et seq.), without regard to any provisions therein relating to appropriation authorization ceilings or to allotments among the States. Grants under this section shall be made solely out of funds specifically appropriated for the purpose of carrying out this Act, and shall not be taken into account in the computation of the allotments among the States pursuant to any other provision of law.

"(b) Not to exceed $6,000,000 of the funds authorized in section 401 of this Act for the two-fiscal-year period ending June 30, 1969, shall be available to carry out this section."

SEC. 15. (a) Section 701 (a) of the Housing Act of 1954 (40 U.S.C. 461(a)) is amended by striking out "and" at the end of clause (8) and all of clause (9) and inserting in lieu thereof the following:

"(9) the Appalachian Regional Commission, for comprehensive planning for the Appalachian region as defined by section 403 of the Appalachian Regional Development Act of 1965; and

"(10) local development districts, certified under section 301 of the Appalachian Regional Development Act of 1965, for comprehensive planning for their entire areas or for metropolitan planning, urban planning, county planning, or small municipality planning within such areas in the Appalachia region, and for planning for Appalachian regional programs."

(b) The first sentence of section 701 (b) of the Housing Act of 1954 is amended by striking out "to States participating in planning for Appalachian regional programs, for expenses incurred in the course of such planning, or to the Appalachian Regional Commission" and inserting in lieu thereof the following: "to States and local development districts participating in planning for Appalachian regional programs, for expenses incurred in the course of such planning, or to the Appalachian Regional Commission".

SEC. 16. Section 214 of the Act is amended to read as follows:

"SUPPLEMENTS TO FEDERAL GRANT-IN-AID PROGRAMS

“SEC. 214. (a) In order to enable the people, States, and local communities of the region, including local development districts, to take maximum advantage of Federal grant-in-aid programs (as hereinafter defined) for which they are eligible but for which, because of their economic situation, they cannot supply the required matching share, the Commission is authorized to approve programs and projects and to advance funds appropriated to carry out this section to the heads of the departments, agencies, and instrumentalities of the Federal Government responsible for the administration of such Federal grant-in-aid programs. Funds so advanced shall be used for the sole purpose of increasing the Federal contribution to projects under such programs above the fixed maximum portion of the cost of such projects otherwise authorized by the applicable law. Funds shall be so advanced for Federal grant-in-aid programs for which funds are available under the Act authorizing such programs. Such advanced funds shall be available without regard to any appropriation authorization ceilings in such Act.

"(b) The Federal portion of such costs shall not be increased in excess of the percentages established by the Commission, and shall in no event exceed 80 per centum thereof.

"(c) The term 'Federal grant-in-aid programs' as used in this section means those Federal grant-in-aid programs authorized by this Act for the construction or equipment of facilities, and all other existing or future Federal grant-in-aid programs that the Commission may designate as furthering the purposes of this Act, authorized by Acts other than this Act for the acquisition of land and the construction or equipment of facilities, including but not limited to grant-in-aid programs authorized by the following Acts: Federal Water Pollution Control Act; Watershed Protection and Flood Prevention Act; title VI of the Public Health Service Act; Vocational Educational Act of 1963; Library Services Act; Federal Airport Act; part IV of title III of the Communications Act of 1934; Higher Education Facilities Act of 1963; Land and Water Conservation Fund Act of 1965; National Defense Education Act of 1958. The term shall not include (A) the program for the construction of the development highway system authorized by section 201 of this Act or any other program relating to highway or road construction, or (B) any other program for which loans or other Federal financial assistance, except a grant-in-aid program, is authorized by this or any other Act. '(d) Not to exceed $90,000,000 of the funds authorized in section 401 of this Act for the two-fiscal-year period ending June 30, 1969, shall be available to carry out this section."

SEC. 17. Section 223 of the Act is amended to read as follows:

"PROGRAM IMPLEMENTATION

"SEC. 223. A program and projects authorized under any section of this title shall not be approved for assistance by the Commission until (1) applications and plans relating to such programs and projects have been submitted to the Federal officer having responsibility for implementing such programs and projeets, and such applications and plans have been determined, except as otherwise provided in this Act, to be in accordance with the provisions of the Federal laws