In the Senate of the United States,

March 12, 2004.

Resolved, That the bill from the House of Representatives (H.R. 254) entitled ‘‘An Act to authorize the President

of the United States to agree to certain amendments to the

Agreement between the Government of the United States of

America and the Government of the United Mexican States

concerning the establishment of a Border Environment Cooperation Commission and a North American Development

Bank, and for other purposes.’’, do pass with the following

AMENDMENT:

Strike out all after the enacting clause and insert:

1 SECTION. 1. AUTHORITY TO AGREE TO CERTAIN AMEND2 MENTS TO THE BORDER ENVIRONMENT CO3 OPERATION AGREEMENT; GRANT AUTHORITY.

4 (a) AMENDMENT AUTHORITY.—Part 2 of subtitle D of

5 title V of Public Law 103–182 (22 U.S.C. 290m–290m-3)

6 is amended by adding at the end the following:
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1 ‘‘SEC. 545. AUTHORITY TO AGREE TO CERTAIN AMEND2 MENTS TO THE BORDER ENVIRONMENT CO3 OPERATION AGREEMENT.

4 ‘‘The President may agree to amendments to the Co5 operation Agreement that—

6 ‘‘(1) enable the Bank to make grants and non7 market rate loans out of its paid-in capital resources

8 with the approval of its Board; and

9 ‘‘(2) amend the definition of ‘border region’ to

10 include the area in the United States that is within

11 100 kilometers of the international boundary between

12 the United States and Mexico, and the area in Mexico

13 that is within 300 kilometers of the international

14 boundary between the United States and Mexico.’’.

15 (b) GRANT AUTHORITY.—Part 2 of subtitle D of title

16 V of Public Law 103–182 (22 U.S.C. 290m–290m–3), as

17 amended by subsection (a), is amended by adding at the

18 end the following:

19 ‘‘SEC. 546. GRANTS OUT OF PAID-IN CAPITAL RESOURCES.

20 ‘‘(a) IN GENERAL.—The President shall instruct the

21 United States Federal Government representatives on the

22 Board of Directors of the North American Development

23 Bank to oppose any proposal where grants out of the Bank’s

24 paid-in capital resources, except for grants from paid-in

25 capital authorized for the community adjustment and in-
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1 vestment program under the Bank’s charter of 1993,

2 would—

3 ‘‘(1) be made to a project that is not being fi4 nanced, in part, by loans; or

5 ‘‘(2) account for more than 50 percent of the fi6 nancing of any individual project.

7 ‘‘(b) EXCEPTION.—

8 ‘‘(1) GENERAL RULE.—The requirements of sub9 section (a) shall not apply in cases where—

10 ‘‘(A) the President determines there are ex11 ceptional economic circumstances for making the

12 grant and consults with the Committee on For13 eign Relations of the Senate and the Committee

14 on Financial Services of the House of Represent15 atives; or

16 ‘‘(B)(i) the grant is being made for a

17 project that is so small that obtaining a loan is

18 impractical; and

19 ‘‘(ii) the grant does not exceed $250,000.

20 ‘‘(2) LIMITATION.—Not more than an aggregate

21 of $5,000,000 in grants may be made under this sub22 section.’’.

23 (c) CLERICAL AMENDMENT.—Section 1(b) of such pub24 lic law is amended in the table of contents by inserting after

25 the item relating to section 544 the following:
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‘‘Sec. 545. Authority to agree to certain amendments to the Border Environment

Cooperation Agreement.

‘‘Sec. 546. Grants out of paid-in capital resources.’’.

1 SEC. 2. ANNUAL REPORT.

2 The Secretary of the Treasury shall submit annually

3 to the Committee on Financial Services of the House of Rep4 resentatives and the Committee on Foreign Relations of the

5 Senate a written report on the North American Develop6 ment Bank, which addresses the following issues:

7 (1) The number and description of the projects

8 that the North American Development Bank has ap9 proved. The description shall include the level of mar10 ket-rate loans, non-market-rate loans, and grants used

11 in an approved project, and a description of whether

12 an approved project is located within 100 kilometers

13 of the international boundary between the United

14 States and Mexico or within 300 kilometers of the

15 international boundary between the United States

16 and Mexico.

17 (2) The number and description of the approved

18 projects in which money has been dispersed.

19 (3) The number and description of the projects

20 which have been certified by the Border Environment

21 Cooperation Commission, but yet not financed by the

22 North American Development Bank, and the reasons

23 that the projects have not yet been financed.
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1 (4) The total of the paid-in capital, callable cap2 ital, and retained earnings of the North American

3 Development Bank, and the uses of such amounts.

4 (5) A description of any efforts and discussions

5 between the United States and Mexican governments

6 to expand the type of projects which the North Amer7 ican Development Bank finances beyond environ8 mental projects.

9 (6) A description of any efforts and discussions

10 between the United States and Mexican governments

11 to improve the effectiveness of the North American De12 velopment Bank.

13 (7) The number and description of projects au14 thorized under the Water Conservation Investment

15 Fund of the North American Development Bank.

16 SEC. 3. SENSE OF THE CONGRESS RELATING TO UNITED

17 STATES SUPPORT FOR NADBANK PROJECTS

18 WHICH FINANCE WATER CONSERVATION FOR

19 TEXAS IRRIGATORS AND AGRICULTURAL

20 PRODUCERS IN THE LOWER RIO GRANDE

21 RIVER VALLEY.

22 (a) FINDINGS.—The Congress finds that—

23 (1) Texas irrigators and agricultural producers

24 are suffering enormous hardships in the lower Rio

25 Grande River valley because of Mexico’s failure to
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1 abide by the 1944 Water Treaty entered into by the

2 United States and Mexico;

3 (2) over the last 10 years, Mexico has accumu4 lated a 1,500,000-acre fee water debt to the United

5 States which has resulted in a very minimal and in6 adequate irrigation water supply in Texas;

7 (3) recent studies by Texas A&M University

8 show that water savings of 30 percent or more can be

9 achieved by improvements in irrigation system infra10 structure such as canal lining and metering;

11 (4) on August 20, 2002, the Board of the North

12 American Development Bank agreed to the creation

13 in the Bank of a Water Conservation Investment

14 Fund, as required by Minute 308 to the 1944 Water

15 Treaty, which was an agreement signed by the United

16 States and Mexico on June 28, 2002; and

17 (5) the Water Conservation Investment Fund of

18 the North American Development Bank stated that up

19 to $80,000,000 would be available for grant financing

20 of water conservation projects, which grant funds

21 would be divided equally between the United States

22 and Mexico.

23 (b) SENSE OF THE CONGRESS.—It is the sense of the

24 Congress that—
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1 (1) water conservation projects are eligible for

2 funding from the North American Development Bank

3 under the Agreement Between the Government of the

4 United States of America and the Government of the

5 United Mexican States Concerning the Establishment

6 of a Border Environment Cooperation Commission

7 and a North American Development Bank; and

8 (2) the Board of the North American Develop9 ment Bank should support qualified water conserva10 tion projects which can assist Texas irrigators and

11 agricultural producers in the lower Rio Grande River

12 Valley.

13 SEC. 4. SENSE OF THE CONGRESS RELATING TO UNITED

14 STATES SUPPORT FOR NADBANK PROJECTS

15 WHICH FINANCE WATER CONSERVATION IN

16 THE SOUTHERN CALIFORNIA AREA.

17 It is the sense of the Congress that the Board of the

18 North American Development Bank should support—

19 (1) the development of qualified water conserva20 tion projects in southern California and other eligible

21 areas in the 4 United States border States, including

22 the conjunctive use and storage of surface and ground

23 water, delivery system conservation, the re-regulation

24 of reservoirs, improved irrigation practices, waste25 water reclamation, regional water management mod-
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1 eling, operational and optimization studies to im2 prove water conservation, and cross-border water ex3 changes consistent with treaties; and

4 (2) new water supply research and projects along

5 the Mexico border in southern California and other el6 igible areas in the 4 United States border States to

7 desalinate ocean seawater and brackish surface and

8 groundwater, and dispose of or manage the brines re9 sulting from desalination.

10 SEC. 5. SENSE OF THE CONGRESS RELATING TO UNITED

11 STATES SUPPORT FOR NADBANK PROJECTS

12 FOR WHICH FINANCE WATER CONSERVATION

13 FOR IRRIGATORS AND AGRICULTURAL PRO14 DUCERS IN THE SOUTHWEST UNITED STATES.

15 (a) FINDINGS.—The Congress finds as follows:

16 (1) Irrigators and agricultural producers are

17 suffering enormous hardships in the southwest United

18 States. The border States of California, Arizona, New

19 Mexico, and Texas are suffering from one of the worst

20 droughts in history. In Arizona, this is the second

21 driest period in recorded history and the worst since

22 1904.

23 (2) In spite of decades of water conservation in

24 the southwest United States, irrigated agriculture uses

25 more than 60 percent of surface and ground water.
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1 (3) The most inadequate water supplies in the

2 United States are in the Southwest, including the

3 lower Colorado River basin and the Great Plains

4 River basins south of the Platte River. In these areas,

5 70 percent of the water taken from the stream is not

6 returned.

7 (4) The amount of water being pumped out of

8 groundwater sources in many areas is greater than

9 the amount being replenished, thus depleting the

10 groundwater supply.

11 (5) On August 20, 2002, the Board of the North

12 American Development Bank agreed to the creation

13 in the bank of a Water Conservation Investment

14 Fund.

15 (6) The Water Conservation Investment Fund of

16 the North American Development Bank stated that up

17 to $80,000,000 would be available for grant financing

18 of water conservation projects, which grant funds

19 would be divided equally between the United States

20 and Mexico.

21 (b) SENSE OF THE CONGRESS.—It is the sense of the

22 Congress that—

23 (1) water conservation projects are eligible for

24 funding from the North American Development Bank

25 under the Agreement Between the Government of the
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1 United States of America and the Government of the

2 United Mexican States Concerning the Establishment

3 of a Border Environment Cooperation Commission

4 and a North American Development Bank;

5 (2) the Board of the North American Develop6 ment Bank should support qualified water conserva7 tion projects that can assist irrigators and agricul8 tural producers; and

9 (3) the Board of the North American Develop10 ment Bank should take into consideration the needs

11 of all of the border states before approving funding for

12 water projects, and strive to fund water conservation

13 projects in each of the border states.

14 SEC. 6. SENSE OF THE CONGRESS REGARDING FINANCING

15 OF PROJECTS.

16 (a) IN GENERAL.—It is the sense of the Congress that

17 the Board of the North American Development Bank should

18 support the financing of projects, on both sides of the inter19 national boundary between the United States and Mexico,

20 that address coastal issues and the problem of pollution in

21 both countries having an environmental impact along the

22 Pacific Ocean and Gulf of Mexico shores of the United

23 States and Mexico.

24 (b) AIR POLLUTION.—It is the sense of the Congress

25 that the Board of the North American Development Bank
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1 should support the financing of projects, on both sides of

2 the international boundary between the United States and

3 Mexico, which address air pollution.

Attest:

Secretary.
108TH CONGRESS

2D SESSION H. R. 254

AMENDMENT