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[House Report 108-650]
[From the U.S. Government Publishing Office]

108th Congress                                                   Report
                        HOUSE OF REPRESENTATIVES
 2d Session                                                     108-650

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         LLAGAS RECLAMATION GROUNDWATER REMEDIATION INITIATIVE

                                _______
                                

 September 7, 2004.--Committed to the Committee of the Whole House on 
            the State of the Union and ordered to be printed

                                _______
                                

  Mr. Pombo, from the Committee on Resources, submitted the following

                              R E P O R T

                        [To accompany H.R. 4459]

      [Including cost estimate of the Congressional Budget Office]

    The Committee on Resources to whom was referred the bill 
(H.R. 4459) to authorize the Secretary of the Interior, acting 
through the Bureau of Reclamation and in coordination with 
other Federal, State, and local government agencies, to 
participate in the funding and implementation of a balanced, 
long-term groundwater remediation program in California, and 
for other purposes, having considered the same, report 
favorably thereon without amendment and recommend that the bill 
do pass.

                          PURPOSE OF THE BILL

    The purpose of H.R. 4459 is to authorize the Secretary of 
the Interior, acting through the Bureau of Reclamation and in 
coordination with other federal, State and local government 
agencies, to participate in the funding and implementation of a 
balanced, long-term groundwater remediation program in 
California.

                  BACKGROUND AND NEED FOR LEGISLATION

    The communities of Morgan Hill and San Martin in Santa 
Clara County, California, have been forced to close wells due 
to perchlorate contamination in the groundwater. Perchlorate is 
both a naturally occurring and man-made chemical. Most of the 
perchlorate manufactured in the United States is used as the 
primary ingredient of solid rocket propellant. Perchlorate is 
also used in the manufacture of pyrotechnics and roadside 
flares. Research indicates that perchlorate interferes with 
iodide uptake into the thyroid gland. Since iodide is an 
essential component of thyroid hormones, perchlorate disrupts 
how the thyroid functions. In adults, the thyroid helps to 
regulate metabolism. In children, the thyroid plays a major 
role in proper development in addition to metabolism.
    Perchlorate has been detected in more than 500 water wells 
in Santa Clara County, stemming from a nine-mile long plume of 
the chemical in the Llagas Groundwater Subbasin. As a result, 
more than 1,000 residences have been supplied with bottled 
water. The Santa Clara Valley Water District is working to 
address the problem and develop a long-term plan for 
remediation of the basin. Near-term solutions, such as point-
of-use drinking water treatment systems and residential 
wellhead treatment systems, are being considered.
    H.R. 4459 establishes the ``California Basins Groundwater 
Remediation Fund'' within the U.S. Treasury. The Fund, subject 
to annual appropriations and administered by the Bureau of 
Reclamation, would provide up to $25 million in federal funding 
to remediate groundwater in the service area of the Santa Clara 
Valley Water District. The bill requires a local cost share of 
35 percent. Perchlorate is the chemical compound of primary 
concern, although funds will be available to remediate other 
groundwater challenges in the area.

                            COMMITTEE ACTION

    H.R. 4459 was introduced by House Resources Committee 
Chairman Richard Pombo (R-CA) on May 20, 2004. The bill was 
referred to the Committee on Resources and within the Committee 
to the Subcommittee on Water and Power. On June 23, 2004, the 
Subcommittee held a hearing on the bill. On July 8, 2004, the 
Subcommittee met to mark up the bill. No amendments were 
offered and the bill was forwarded to the Full Resources 
Committee by unanimous consent. On July 14, 2004, the Full 
Resources Committee met to mark up the bill. No amendments were 
offered and the bill was ordered favorably reported to the 
House of Representatives by unanimous consent.

                      SECTION-BY-SECTION ANALYSIS

Section 1. Short title

    The bill may be cited as the ``Llagas Reclamation 
Groundwater Remediation Initiative.''

Section 2. Definitions

    This section defines various terms used in the bill.

Section 3. California basins remediation

    This section establishes the ``California Basins 
Groundwater Remediation Fund'' within the Treasury of the 
United States. The Fund will be administered by the Secretary 
of the Interior, through the Bureau of Reclamation, and in 
cooperation with the local water authority. The section 
requires that the Fund shall be used for reimbursing the local 
water authority for the federal share of the costs for the 
planning, design, and construction of groundwater remediation 
projects. An authorization of $25 million would be available to 
carry out the purposes of the bill. The section requires that 
the local non-federal cost share be no less than 35 percent. 
Non-federal funding sources may include State or local 
government agencies and private entities.
    The section also states that the bill shall not affect 
other federal and State authorities being used for remediation 
and protection of the groundwater in the natural watersheds of 
the Llagas groundwater subbasin in California. Furthermore, no 
funds used for activities and projects pursuant to this section 
shall be counted against federal authorization ceilings 
established for previously authorized federal activities and 
projects.

            COMMITTEE OVERSIGHT FINDINGS AND RECOMMENDATIONS

    Regarding clause 2(b)(1) of rule X and clause 3(c)(1) of 
rule XIII of the Rules of the House of Representatives, the 
Committee on Resources' oversight findings and recommendations 
are reflected in the body of this report.

                   CONSTITUTIONAL AUTHORITY STATEMENT

    Article I, section 8 of the Constitution of the United 
States grants Congress the authority to enact this bill.

                    COMPLIANCE WITH HOUSE RULE XIII

    1. Cost of Legislation. Clause 3(d)(2) of rule XIII of the 
Rules of the House of Representatives requires an estimate and 
a comparison by the Committee of the costs which would be 
incurred in carrying out this bill. However, clause 3(d)(3)(B) 
of that rule provides that this requirement does not apply when 
the Committee has included in its report a timely submitted 
cost estimate of the bill prepared by the Director of the 
Congressional Budget Office under section 402 of the 
Congressional Budget Act of 1974.
    2. Congressional Budget Act. As required by clause 3(c)(2) 
of rule XIII of the Rules of the House of Representatives and 
section 308(a) of the Congressional Budget Act of 1974, this 
bill does not contain any new budget authority, credit 
authority, or an increase or decrease in revenues or tax 
expenditures. According to the Congressional Budget Office, 
enactment of this bill would result in increased direct 
spending of less than $500,000 per year annually from 2005-
2012.
    3. General Performance Goals and Objectives. As required by 
clause 3(c)(4) of rule XIII, the general performance goal or 
objective of this bill is to authorize the Secretary of the 
Interior, acting through the Bureau of Reclamation and in 
coordination with other federal, State and local government 
agencies, to participate in the funding and implementation of a 
balanced, long-term groundwater remediation program in 
California.
    4. Congressional Budget Office Cost Estimate. Under clause 
3(c)(3) of rule XIII of the Rules of the House of 
Representatives and section 403 of the Congressional Budget Act 
of 1974, the Committee has received the following cost estimate 
for this bill from the Director of the Congressional Budget 
Office:

H.R. 4459--Llagas Reclamation Groundwater Remediation Initiative

    Summary: H.R. 4459 would establish an interest-bearing 
account in the Treasury called the California Basins 
Groundwater Remediation Fund and would authorize the 
appropriation of $25 million to be deposited into the fund. The 
bill would authorize the Secretary of the Interior through the 
Bureau of Reclamation to use the fund to provide grants to the 
Santa Clara Valley Water District for groundwater cleanup 
projects in the Llagas watershed in Santa Clara County, 
California. H.R. 4459 would authorize the bureau to pay up to 
65 percent of the cost of the groundwater cleanup projects. The 
bureau, however, would not have the authority to obligate money 
for a project until the nonfederal share of the costs (35 
percent) is either deposited into the account or credited to 
the account as an in-kind contribution.
    Assuming appropriation of the necessary funds, CBO 
estimates that implementing H.R. 4459 would cost $20 million 
over the 2005-2009 period and an additional $5 million after 
that period. Enacting this bill would increase direct spending 
by less than $500,000 annually over the 2005-2012 period.
    H.R. 4459 contains no intergovernmental or private-sector 
mandates as defined in the Unfunded Mandates Reform Act (UMRA) 
and would impose no costs on state, local, or tribal 
governments. The federal funds authorized by this bill would 
benefit local governments in California. Any expenditures made 
by those governments to provide the required matching funds 
would be made voluntarily.
    Estimated cost to the Federal Government: The estimated 
budgetary impact of H.R. 4459 is shown in the following table. 
The costs of this legislation fall within budget function 300 
(natural resources and environment).

----------------------------------------------------------------------------------------------------------------
                                                                       By fiscal year, in millions of dollars--
                                                                    --------------------------------------------
                                                                       2005     2006     2007     2008     2009
----------------------------------------------------------------------------------------------------------------
                                CHANGES IN SPENDING SUBJECT TO APPROPRIATION \1\

Estimated Authorization Level......................................        5        5        5        5        5
Estimated Outlays..................................................        2        3        5        5        5
----------------------------------------------------------------------------------------------------------------
\1\ Implementing H.R. 4459 also would increase direct spending by less than $500,000 a year.

Basis of estimate

            Spending subject to appropriation
    For this estimate, CBO assumes that H.R. 4459 will be 
enacted near the end of fiscal year 2004 and that the necessary 
funds will be appropriated in equal amounts over the 2005-2009 
period to the California Basins Groundwater Remediation Fund. 
Because the bill would require that the nonfederal cost share 
be deposited into the fund or in-kind contributions be credited 
before funds could be obligated, CBO expects that spending on 
the Santa Clara projects would be somewhat slower than 
historical federal spending on similar projects. CBO estimates 
that implementing this bill would cost $20 million over the 
2005-2009 period and an additional $5 million after that 
period.
            Direct spending
    Under this bill, nonfederal funds equal to 35 percent of 
the total cost of the project would be required to be either 
deposited into the account or credited to the account as an in-
kind contribution before any funds could be obligated. 
Currently, it is unknown how much of the nonfederal 
contributions would be cash and how much would be in-kind 
donations. According to the bureau, the total cost of the 
project could be at least $40 million, which means that the 
nonfederal share could be at least $15 million. Any receipt to 
the fund, however, would be offset by equal amounts of direct 
spending from the fund over the 2005-2012 period.
    In addition, the bill would authorize the bureau to spend 
interest earned on the California Basins Groundwater 
Remediation Fund. CBO estimates that provision would increase 
direct spending by less than $500,000 annually over the 2005-
2012 period.
    Intergovernmental and private-sector impact: H.R. 4459 
contains no intergovernmental or private-sector mandates as 
defined in UMRA and would impose no costs on state, local, or 
tribal governments. The federal funds authorized by this bill 
would benefit local governments in California. Any expenditures 
made by those governments to provide the required matching 
funds would be made voluntarily.
    Estimate prepared by: Federal Costs: Julie Middleton; 
Impact on State, Local, and Tribal Governments: Marjorie 
Miller; Impact on the Private Sector: Karen Raupp.
    Estimate approved by: Peter H. Fontaine, Deputy Assistant 
Director for Budget Analysis.

                    COMPLIANCE WITH PUBLIC LAW 104-4

    This bill contains no unfunded mandates.

                PREEMPTION OF STATE, LOCAL OR TRIBAL LAW

    This bill is not intended to preempt any State, local or 
tribal law.

                        CHANGES IN EXISTING LAW

    If enacted, this bill would make no changes in existing 
law.

                                  
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