To amend the Internal Revenue Code of 1986 to allow employers in renewal communities to qualify for the renewal community employment credit by employing residents of certain other renewal communities.

At the end of end of subtitle C of title V add the following:

SEC. ____. RENEWAL COMMUNITY EMPLOYERS MAY QUALIFY FOR EMPLOYMENT CREDIT BY EMPLOYING RESIDENTS OF CERTAIN OTHER RENEWAL COMMUNITIES.

(a) In General.--Section 1400H(b)(2) (relating to modification) is amended by striking “and” at the end of paragraph (1), by striking the period at the end of paragraph (2) and inserting “, and”, and by adding at the end the following new paragraph:

“(3) subsection (d)(1)(B) thereof shall be applied by substituting ‘such renewal community, an adjacent renewal community within the same State as such renewal community, or a renewal community within such State which is within 5 miles of any border of such renewal community' for ‘such empowerment zone'.”.

(b) Reduction of Acceleration of Top Rate Reduction In Individual Income Tax Rates.--Notwithstanding the amendment made by section 102(a) of this Act, in lieu of the percent specified in the last column of the table in paragraph (2) of section 1(i) of the Internal Revenue Code of 1986, as amended by such section 102(a), for taxable years beginning during calendar year 2003, 35.1% shall be substituted for such year.

(c) Effective Dates.--

(1) The amendments made by subsection (a) shall take effect as if included in the amendment made by section 101(a) of the Community Renewal Tax Relief Act of 2000.

(2) Subsection (b) shall take effect on the date of enactment of this Act.