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[Congressional Bills 103th Congress]
[From the U.S. Government Publishing Office]
[H.R. 350 Introduced in House (IH)]

103d CONGRESS
  1st Session
                                H. R. 350

    To amend the Federal Water Pollution Control Act to further the 
            protection of wetlands, and for other purposes.

_______________________________________________________________________

                    IN THE HOUSE OF REPRESENTATIVES

                            January 5, 1993

Mr. Edwards of California (for himself, Mr. Abercrombie, Mr. Beilenson, 
 Mr. Berman, Mr. Blackwell, Mr. Dellums, Mr. Evans, Mr. Gilchrest, Mr. 
Hamburg, Mr. Kennedy, Mr. Lantos, Mr. Markey, Mr. Miller of California, 
 Mr. Mineta, Mrs. Mink, Ms. Pelosi, Mr. Ravenel, Mr. Shays, Mr. Stark, 
   Mr. Stokes, Mr. Vento, Mr. Weldon, and Mr. Yates) introduced the 
following bill; which was referred jointly to the Committees on Public 
 Works and Transportation, Merchant Marine and Fisheries, and Ways and 
                                 Means

                             April 19, 1993

  Additional sponsors: Mr. Andrews of Maine, Mr. Brown of California, 
  Mrs. Byrne, Mr. Cardin, Ms. Eshoo, Mr. Gejdenson, Mr. Hinchey, Mr. 
Machtley, Mr. McDermott, Mr. Olver, Mr. Rangel, Mr. Sabo, Mr. Sanders, 
 Mrs. Schroeder, Mr. Skaggs, Ms. Slaughter, Mr. Torres, Mr. Towns, Mr. 
   Waxman, Ms. Woolsey, Mr. Ackerman, Mr. Andrews of New Jersey, Mr. 
Coleman, Mr. Conyers, Mr. de Lugo, Mr. Hastings, Mr. Hochbrueckner, Mr. 
   McHale, Mrs. Maloney, Mr. Moran, Ms. Norton, Mr. Richardson, Mr. 
Sawyer, Mr. Johnston of Florida, Mr. Meehan, Mr. Lewis of Georgia, Mr. 
Swett, Mr. Jacobs, Mr. Payne of New Jersey, Ms. McKinney, Mr. Serrano, 
                       Ms. Harman, and Mr. Nadler

_______________________________________________________________________

                                 A BILL

 
    To amend the Federal Water Pollution Control Act to further the 
            protection of wetlands, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Wetlands Reform Act of 1993''.

     TITLE I--AMENDMENTS TO THE FEDERAL WATER POLLUTION CONTROL ACT

SEC. 101. STATEMENT OF POLICY.

    Section 101(a) of the Federal Water Pollution Control Act (33 
U.S.C. 1251(a)) is amended--
            (1) in paragraph (6) by striking ``and'' after the 
        semicolon at the end;
            (2) in paragraph (7) by striking the period and inserting 
        ``; and''; and
            (3) by adding at the end the following:
            ``(8) it is the national policy to preserve the quantity 
        and quality of the Nation's wetlands and to restore those 
        wetlands which have been degraded.''.

SEC. 102. EXPANSION OF SCOPE OF PERMIT PROGRAM.

    (a) Prohibition of Activities.--Subsection 301(a) of the Federal 
Water Pollution Control Act (33 U.S.C. 1311(a)) is amended to read as 
follows:
    ``Sec. 301. (a) Except as in compliance with this section and 
sections 302, 306, 307, 318, 402, and 404 of this Act, the discharge of 
any pollutant or other alteration of navigable waters by any person 
shall be unlawful.''.
    (b) Certification.--The first sentence of section 401(a) of the 
Federal Water Pollution Control Act (33 U.S.C. 1341(a)) is amended to 
read as follows: ``Any applicant for a Federal license or permit to 
conduct any activity, including the construction or operation of 
facilities, which may result in any discharge into or other alteration 
of navigable waters, shall provide the licensing or permitting agency a 
certification from the State where the activity occurs or will occur, 
or, if appropriate, from the interstate water pollution control agency 
having jurisdiction over the navigable waters where the activity occurs 
or will occur, that the activity will comply with the applicable 
provisions of sections 301, 302, 303, 306, and 307 and will allow for 
the protection, achievement, and maintenance of designated uses 
included in applicable water quality standards.''.
    (c) Issuance of Permits.--Section 404(a) of the Federal Water 
Pollution Control Act (33 U.S.C. 1344(a)) is amended by inserting 
before the period at the end of the first sentence the following: ``, 
or for other alterations of navigable waters''.
    (d) Definition.--Section 502 of the Federal Water Pollution Control 
Act (33 U.S.C. 1362) is amended by adding at the end the following:
            ``(21) The term `other alteration' means draining, 
        dredging, excavation, channelization, flooding, clearing of 
        vegetation, driving of pilings or placement of other 
        obstructions, diversion of water, or other activities in 
        navigable waters which impair the flow, reach, or circulation 
        of surface water, or which result in a more than minimal change 
        in the hydrologic regime, bottom contour, or configuration of 
        such waters, or in the type, distribution, or diversity of 
        vegetation, fish, and wildlife that depend on such waters.''.

SEC. 103. DEFINITION OF FILL MATERIAL.

    Section 404(d) of the Federal Water Pollution Control Act (33 
U.S.C. 1344(d)) is amended--
            (1) by inserting ``(1)'' after ``(d)''; and
            (2) by adding at the end the following:
    ``(2) The term `fill material' as used in this section means any 
pollutant which has the effect of replacing portions of navigable 
waters or changing the bottom elevation or configuration of a water 
body.''.

SEC. 104. PERMIT REVIEW BY RESOURCE AGENCIES.

    (a) Review by Secretary of Interior and Secretary of Commerce.--
Section 404(m) of the Federal Water Pollution Control Act (33 U.S.C. 
1344(m)) is amended by striking ``Secretary of the Interior, acting 
through the Director of the United States Fish and Wildlife Service'' 
each place it appears and inserting ``Secretary of the Interior, acting 
through the Director of the United States Fish and Wildlife Service, 
and the Secretary of Commerce, acting through the Assistant 
Administrator of the National Marine Fisheries Service''.
    (b) Response in Writing.--Section 404(m) of the Federal Water 
Pollution Control Act (33 U.S.C. 1344(m)) is amended by adding at the 
end the following: ``The Secretary shall adopt the recommendations made 
in the comments or respond in writing to the Secretary of the Interior 
or the Secretary of Commerce, as appropriate, describing his or her 
reasons for not adopting the recommendations and explaining how his or 
her determination is consistent with the goals and purposes of this Act 
and the guidelines developed under section 404(b)(1).''.

SEC. 105. CLARIFICATION OF GENERAL PERMIT PROGRAM.

    Section 404(e)(1) of the Federal Water Pollution Control Act (33 
U.S.C. 1344(e)(1)) is amended to read as follows:
    ``(e)(1)(A) In carrying out the functions of the Secretary under 
this section relating to the discharge of dredged or fill material or 
other alteration of navigable waters, the Secretary may, after notice 
and opportunity for public hearing, and with the concurrence of the 
Administrator, issue general permits on a State, multi-State, or 
nationwide basis for any narrowly defined category of activities 
involving discharges of dredged or fill material or other alterations 
of navigable waters if the Secretary determines that the activities in 
such category are similar in nature, will cause only minimal adverse 
environmental effects when performed separately, and will have only 
minimal cumulative adverse effect on the environment. Any general 
permit issued under this subsection shall be consistent with the goals 
and purposes of this Act, shall be based on the guidelines described in 
subsection (b)(1), shall set forth the requirements and standards which 
shall apply to any activity authorized by such general permit, and 
shall include adequate measures to enable the Secretary to be apprised 
of and to monitor activities conducted pursuant to such general permit.
    ``(B) Before any activity is authorized under a general permit for 
which predischarge notification is required pursuant to regulations, 
notice and 30 days opportunity to comment shall be given by the 
Secretary to the Administrator, the Secretary of the Interior, the 
Secretary of Commerce, State agencies responsible for water quality, 
fish, and wildlife resources which may be affected by such activity, 
and to the public.
    ``(C) No activity shall be authorized under a general permit within 
a State that has denied or revoked water quality certification pursuant 
to section 401 for such activities under that general permit.
    ``(D) Each general permit shall be reviewed by the Secretary 
biennially, taking into account the information contained in reports 
required by section 404(u), and shall, after notice and hearing, be 
revised or revoked as necessary to avoid or minimize cumulative adverse 
effects on navigable waters.''.

SEC. 106. REPORTS ON EFFECTS OF PERMIT PROGRAM ON WETLANDS.

    Section 404 of the Federal Water Pollution Control Act (33 U.S.C. 
1344) is amended by adding at the end the following:
    ``(u) Reports on Permit Program.--
            ``(1) Effects of permitted activities.--
                    ``(A) In general.--The Secretary, in consultation 
                with the Administrator, the Secretary of the Interior, 
                and those States which have a permit program approved 
                under subsection (h)(2), shall report biennially to the 
                Congress on the effects on navigable waters of 
                activities conducted under permits issued pursuant to 
                this section, including general permits. Such reports 
                shall contain estimates of the acreage and functions of 
                navigable waters affected by each general permit, in 
                order to determine whether the individual and 
                cumulative adverse environmental effects of activities 
                authorized by each general permit are minimal.
                    ``(B) Monitoring.--For purposes of preparing 
                reports under this subsection, the Secretary, the 
                Administrator, and the Secretary of the Interior shall 
                jointly monitor the achievement of the policy stated in 
                section 101(a)(8) under permits issued under this 
                section.
                    ``(C) Content of reports.--Reports under this 
                subsection shall include consideration of relevant 
                information contained in individual and general permit 
                applications, compliance monitoring records and maps, 
                and any other relevant information.
            ``(2) Effects of compensatory mitigation.--The Secretary, 
        in consultation with the Administrator, the Secretary of the 
        Interior, and those States which have a permit program approved 
        under subsection (h)(2), shall report biennially to the 
        Congress on the effects on navigable waters of compensatory 
        mitigation required under permits issued under this section, 
        including general permits. Such reports shall contain--
                    ``(A) estimates of the number of permits for which 
                compensatory mitigation is required; and
                    ``(B) a description of--
                            ``(i) the type and extent of compensatory 
                        mitigation projects required,
                            ``(ii) the degree of compliance with those 
                        compensatory mitigation requirements,
                            ``(iii) the extent to which such 
                        compensatory mitigation requirements have been 
                        successful in restoring the intended range of 
                        functions and values, and
                            ``(iv) the extent to which monitoring and 
                        enforcement of compensatory mitigation 
                        requirements have been conducted by the 
                        agencies.''.

SEC. 107. EXPEDITED PERMIT REVIEW.

    Section 404(q) of the Federal Water Pollution Control Act (33 
U.S.C. 1344(q)) is amended to read as follows:
    ``(q)(1) Reduction in Paperwork and Delays.--Not later than the 
180th day after the date of the enactment of this subsection, the 
Secretary shall enter into agreements with the Administrator, the 
Secretaries of the Departments of Agriculture, Commerce, and Interior, 
and the heads of other appropriate Federal agencies to minimize, to the 
maximum extent practicable, duplication, needless paperwork, and delays 
in the issuance of permits under this section.
    ``(2) Fast Track for Minor Permits.--
            ``(A) Not later than 6 months after the date of enactment 
        of this subsection, the Secretary shall establish in each 
        district office a special Fast Track team to expedite the 
        review and processing of minor permits. Each team shall consist 
        of not more than 25 percent of all personnel assigned to review 
        permit applications under this section, and shall not be 
        assigned to review or process any permits other than minor 
        permits, unless final decisions have been reached with respect 
        to all such minor permits within 60 days after the notice of 
        application for such permits is published pursuant to 
        subsection (a).
            ``(B) The District Engineer in each district office shall 
        review the operations of the Fast Track team in that office 
        every 6 months. If final decisions on a significant percentage 
        of minor permits have not been reached within 60 days after the 
        notice of application for such permits is published pursuant to 
        subsection (a), additional personnel shall be assigned to the 
        Fast Track team.
            ``(C) For purposes of this subsection, a minor permit is a 
        permit for an activity that would disturb no more than 1 acre 
        of wetlands, is being performed by a private individual or a 
        business that employs no more than 10 people, and is not part 
        of a larger common plan or proposal that would disturb 
        additional acreage, except that a permit shall not be a minor 
        permit if--
                    ``(i) the Secretary is required under the National 
                Environmental Policy Act of 1969 to issue an 
                environmental impact statement;
                    ``(ii) the permit involves an activity that may 
                affect any species that is listed as an endangered 
                species or threatened species under the Endangered 
                Species Act of 1973, or the habitat of such a species; 
                or
                    ``(iii) the Secretary, the Administrator, or a 
                Federal department or agency referred to in paragraph 
                (1) requests that the permit application receive 
                additional review.''.

SEC. 108. AVOIDANCE AND MINIMIZATION OF ADVERSE EFFECTS.

    Section 404 of the Federal Water Pollution Control Act (33 U.S.C. 
1344), as amended by this Act, is further amended by adding at the end 
the following:
    ``(v) No individual or general permit shall be issued for an 
activity pursuant to this section if there is a practicable alternative 
to the proposed activity which would have less adverse environmental 
impact on navigable waters.''.

SEC. 109. EXEMPTIONS FOR AGRICULTURE AND OTHER ACTIVITIES.

    (a) In General.--Section 404(f) of the Federal Water Pollution 
Control Act (33 U.S.C. 1344) is amended to read as follows:
    ``(f)(1) Except as provided in paragraph (2), the discharge of 
dredge or fill material in or other alterations of navigable waters--
            ``(A) from normal farming, silviculture, and ranching 
        activities, such as plowing, seeding, cultivating, minor 
        drainage, harvesting for the production of food, fiber, and 
        forest products, and upland soil and water conservation 
        practices;
            ``(B) for the purpose of maintenance, including emergency 
        reconstruction of recently damaged parts, of currently 
        serviceable structures such as dikes, dams, levees, groins, 
        riprap, breakwaters, causeways, bridge abutments or approaches, 
        and transportation structures, to their current or most recent 
        configuration;
            ``(C) for the purpose of construction or maintenance of 
        farm or stock ponds or irrigation ditches, or the maintenance 
        of drainage ditches;
            ``(D) for the purpose of construction of temporary 
        sedimentation basins on a construction site which does not 
        involve placement of fill material into navigable waters;
            ``(E) for the purpose of construction or maintenance of 
        farm roads or forest roads, or temporary roads for moving 
        mining equipment, where such roads are constructed and 
        maintained, in accordance with best management practices, to 
        assure that flow and circulation patterns and chemical and 
        biological characteristics of the navigable waters are not 
        impaired, that the reach of the navigable waters is not 
        reduced, and that any adverse effect on the aquatic environment 
        will otherwise be minimized; or
            ``(F) resulting from any activity with respect to which a 
        State has an approved program under section 208(b)(4) which 
        meets the requirements of subparagraphs (B) and (C) of that 
        section;
is not prohibited by or otherwise subject to regulation under this 
section or section 301(a) or 402 (except for effluent standards or 
prohibitions under section 307).
    ``(2) Any discharge of dredged or fill material into, or other 
alteration of, the navigable waters incidental to any activity having 
as its purpose bringing an area of the navigable waters into a use to 
which it was not previously subject, where the flow or circulation of 
navigable waters may be impaired or the reach of such waters be 
reduced, shall be required to have a permit under this section.
    ``(3) An activity which does not result in the discharge of dredge 
or fill material into, or other alterations of, the navigable waters 
shall not be prohibited or otherwise subject to regulation under this 
section.
    ``(4)(A) For purposes of this section, the following shall not be 
considered to be navigable waters:
            ``(i) Nontidal drainage and irrigation ditches excavated in 
        uplands.
            ``(ii) Artificially irrigated areas which would revert to 
        uplands if the irrigation ceased.
            ``(iii) Artificial lakes or ponds created by excavating or 
        diking uplands to collect and retain water, and which are used 
        exclusively for stock watering, irrigation, or rice growing.
            ``(iv) Artificial reflecting or swimming pools or other 
        small ornamental bodies of water created by excavating or 
        diking uplands to retain water for primarily aesthetic reasons.
            ``(v) Waterfilled depressions created in uplands incidental 
        to construction activity and pits excavated in uplands for the 
        purpose of obtaining fill, sand, or gravel, unless and until 
        the construction or excavation operation is abandoned and the 
        resulting body of water meets the definition of waters of the 
        United States.
    ``(B) Subparagraph (A) shall not apply to a particular water body 
unless the person desiring to conduct an activity in that water body is 
able to demonstrate that the water body qualifies under subparagraph 
(A) for exemption from regulation under this section.
    ``(5) Except as provided in paragraph (2), normal plowing, seeding, 
cultivating, minor drainage for crop production, or harvesting shall 
not be prohibited or otherwise subject to regulation under this section 
in waters of the United States which have been maintained as cropland 
at least one growing season in the 5-years prior to such plowing, 
seeding, cultivating, minor drainage, or harvesting.''.

SEC. 110. CITIZEN SUITS AMENDMENTS.

    Section 505 of the Federal Water Pollution Control Act (33 U.S.C. 
1365) is amended--
            (1) in subsection (f) by striking ``or (7)'' and inserting 
        the following: ``(7) a permit or condition thereof issued under 
        section 404, which has been, or is, in effect under this Act 
        (including a requirement applicable by reason of section 313); 
        or (8)'';
            (2) in subsection (a)(1)(B) by inserting after 
        ``Administrator'', the following: ``, the Secretary of the 
        Army'';
            (3) in subsection (a) in the matter following paragraph (2) 
        by inserting after ``under section 309(d)'' the following: 
        ``and section 404(s)'';
            (4) in subsection (b)(1)(A) by striking ``and (iii)'' and 
        inserting the following: ``(iii) to the Secretary of the Army 
        (if the alleged violation is under section 404); and (iv)'';
            (5) in subsection (b)(1)(B) by inserting after ``if the 
        Administrator'' the following: ``, the Secretary of the 
        Army,'';
            (6) in subsection (c)(2) by inserting after ``the 
        Administrator'' the following: ``(and the Secretary of the 
        Army, if the alleged violation is under section 404)'';
            (7) in subsection (c)(3) by inserting after ``Attorney 
        General'' each place it appears the following: ``, the 
        Secretary of the Army (if the alleged violation is under 
        section 404 of this Act),'';
            (8) in subsection (e) by inserting after ``Administrator'' 
        the following: ``, the Secretary of the Army,'';
            (9) in subsection (h) by inserting after ``Administrator'' 
        each place it appears the following: ``or the Secretary of the 
        Army'';
            (10) in paragraph (2) of subsection (a) and in the matter 
        following that paragraph by inserting after ``Administrator'' 
        each place it appears the following: ``or the Secretary of the 
        Army''; and
            (11) in subsection (b)(2) by inserting after 
        ``Administrator'' the following: ``or the Secretary of the 
        Army''.

     TITLE II--IMPROVED WETLANDS PERMITTING; REVISIONS TO WETLANDS 
                         DELINEATION PROCEDURES

SEC. 201. IMPROVEMENT OF ADMINISTRATION OF WETLANDS PERMITTING.

    (a) Needs Analysis.--
            (1) In general.--Not later than 90 days after the date of 
        the enactment of this Act, the Comptroller General of the 
        United States shall submit to the Congress an analysis of the 
        needs of the Corps of Engineers and the Environmental 
        Protection Agency for additional personnel, administrative 
        resources, and funding to improve implementation of section 404 
        of the Federal Water Pollution Control Act (33 U.S.C. 1344).
            (2) Contents.--The analysis submitted under this subsection 
        shall--
                    (A) give particular emphasis to the needs of the 
                Corps of Engineers and the Environmental Protection 
                Agency with respect to improving and expediting 
                wetlands delineation and wetlands permitting generally;
                    (B) include recommendations regarding additional 
                appropriations necessary for that improvement and 
                expedition; and
                    (C) identify the Corps of Engineers district 
                offices and Environmental Protection Agency regions 
                that have the greatest need for those additional 
                appropriations.
    (b) Funding for Training and Certification Program for Wetlands 
Delineators.--Of amounts appropriated for each fiscal year beginning 
after the date of the enactment of this Act for administration of 
section 404 of the Federal Water Pollution Control Act (33 U.S.C. 1344) 
by the Corps of Engineers, the Secretary of the Army (hereinafter in 
this title referred to as the ``Secretary'') shall use such amounts as 
are necessary to carry out the program for training and certification 
of individuals as wetlands delineators authorized by section 307(e) of 
the Water Resources Development Act of 1990 (Public Law 101-640).
    (c) Funding for Improvement of Section 404 Education and Outreach 
Programs.--Of amounts appropriated for each fiscal year beginning after 
the date of the enactment of this Act for administration of section 404 
of the Federal Water Pollution Control Act (33 U.S.C. 1344) by the 
Corps of Engineers or the Environmental Protection Agency, the 
Secretary or the Administrator of the Environmental Protection Agency, 
respectively, shall use such amounts as are necessary to improve 
existing education and outreach programs of the Corps of Engineers or 
the Environmental Protection Agency regarding requirements of that 
section.
    (d) Funding for Expediting and Completing Wetlands Mapping.--
            (1) Completion of mapping.--Of amounts appropriated for 
        each fiscal year beginning after the date of the enactment of 
        this Act for programs of the United States Fish and Wildlife 
        Service, the Director of the United States Fish and Wildlife 
        Service shall use--
                    (A) such amounts as are necessary to complete the 
                existing wetland mapping program of the Service by not 
                later than 1 year after the date of the enactment of 
                this Act;
                    (B) such amounts (in addition to amounts used 
                pursuant to subparagraphs (A) and (C)) as are necessary 
                to conduct mapping under that program in areas where 
                there is the potential for delineating particularly 
                large areas of wetlands; and
                    (C) such amounts as may be necessary (in addition 
                to amounts used pursuant to subparagraphs (A) and (B)) 
                to delineate wetlands under that program in watersheds 
                and ecosystems for which the need for delineation is 
                particularly acute, such as where wetlands are 
                particularly difficult to identify or where pressure 
                for development of wetlands is intense, by as soon as 
                practicable after the date of the enactment of this 
                Act.
            (2) Updating maps.--The Director of the United States Fish 
        and Wildlife Service shall update each map prepared under the 
        existing wetlands mapping program at least once--
                    (A) in the 15-year period beginning on the date of 
                the completion of the map, and
                    (B) in every 15-year period thereafter.
    (e) Funding to Assist Small Landowners With Wetlands Delineation.--
Of amounts appropriated for each fiscal year beginning after the date 
of enactment of this Act for administration of section 404 of the 
Federal Water Pollution Control Act (33 U.S.C. 1344), the Secretary of 
the Army shall use such amounts as are necessary, but not to exceed 
$5,000,000, to assist landowners who lack the financial capacity to do 
wetlands delineations needed to apply for permits under that section. 
The Secretary may provide such assistance either by providing technical 
assistance or by performing delineations. Within 180 days after the 
date of the enactment of this Act the Secretary shall issue regulations 
defining which landowners are eligible for such assistance.

SEC. 202. REVISIONS TO FEDERAL WETLANDS DELINEATION PROCEDURES.

    After the date of the enactment of this Act, no revisions to or 
clarifications of any Federal manual for identifying and delineating 
jurisdictional wetlands shall be adopted, and no guidance or 
regulations related to the definition, delineation, or identification 
of wetlands shall be issued, until the National Academy of Sciences has 
completed the study of wetlands authorized by Public Law 102-389. All 
subsequent revisions to any Federal manual for the identification and 
delineation of wetlands shall take into consideration the scientific 
and technical recommendations of the National Academy of Sciences.

                TITLE III--WETLANDS RESTORATION PROGRAM

SEC. 301. WETLANDS RESTORATION PILOT PROGRAM.

    The Secretary, in cooperation with the Administrator, the Director 
of the United States Fish and Wildlife Service, and appropriate State 
and local government entities, shall initiate, with opportunity for 
public notice and comment, a pilot program of wetlands restoration. The 
purposes of the pilot program are--
            (1) to identify areas where the restoration of significant 
        wetland acreage and functions, including fish and wildlife 
        habitat, water quality protection, and natural hydrologic 
        functions, could contribute substantially to preserving the 
        quantity and quality of the Nation's wetlands;
            (2) to test methods and techniques for wetlands restoration 
        in such areas, and in areas previously identified as suitable 
        for restoration; and
            (3) to develop a means of evaluating the success over the 
        long term of such wetlands restoration efforts.

SEC. 302. SENSE OF CONGRESS CONCERNING WETLANDS RESERVE PROGRAM.

    It is the sense of Congress that the Wetlands Reserve Program 
authorized by the Food, Agriculture, Conservation and Trade Act of 1990 
is an effective wetlands conservation and restoration program which has 
the potential to benefit agriculturalists, rural communities, and the 
Nation's wetlands resource base. Further, it is the sense of Congress 
that the Wetlands Reserve Program should be fully funded to achieve its 
acreage enrollment goals, and should be actively promoted by the 
Department of Agriculture to achieve full subscription.

           TITLE IV--TAX INCENTIVES FOR WETLANDS CONSERVATION

SEC. 401. WETLANDS STEWARDSHIP TRUSTS.

    (a) Designation.--The Secretary of the Interior shall designate a 
nonprofit organization to be a Wetlands Stewardship Trust for purposes 
of this section if the organization--
            (1) includes among its primary purposes the acquisition of 
        private interests in wetlands, former wetlands, and associated 
        real property for the purpose of restoring or preserving such 
        property, and
            (2) meets such other requirements as may be established in 
        regulations issued under subsection (c).
    (b) Application.--A nonprofit organization seeking to be designated 
a Wetlands Stewardship Trust for purposes of this section may submit to 
the Secretary of the Interior an application for that designation, in 
accordance with procedures established in regulations issued under 
subsection (c).
    (c) Regulations.--Not later than 180 days after the date of the 
enactment of this Act, the Secretary of the Interior, acting through 
the Director of the United States Fish and Wildlife Service, in 
consultation with the Secretary of the Army, acting through the Corps 
of Engineers, and the Administrator of the Environmental Protection 
Agency shall issue regulations establishing requirements for being 
designated a Wetlands Stewardship Trust under this section.

SEC. 402. TAX TREATMENT OF DONATIONS OF WETLANDS.

    (a) Tax Treatment.--Subsection (e) of section 170 of the Internal 
Revenue Code of 1986 (relating to charitable, etc., contributions and 
gifts) is amended by adding at the end thereof the following new 
paragraph:
            ``(6) Special rules for contributions of wetlands.--
                    ``(A) In general.--In the case of a charitable 
                contribution by a taxpayer of wetlands (or any interest 
                therein) to a Wetlands Stewardship Trust or to a 
                governmental unit referred to in subsection (c)(1) for 
                the purpose of preserving the property in its natural 
                state--
                            ``(i) 50 percent limitation to apply to 
                        individuals.--Such a contribution by an 
                        individual shall be treated for purposes of 
                        this section as described in subsection 
                        (b)(1)(A).
                            ``(ii) 20-year carryforward.--Subsection 
                        (d)(1) shall be applied by substituting `20 
                        years' for `5 years' each place it appears and 
                        with appropriate adjustments in the application 
                        of subparagraphs (A)(ii) and (B)(ii) thereof.
                            ``(iii) Extension of period for 
                        exchanges.--If such contribution is made as 
                        part of an exchange to which section 1031 
                        applies, paragraph (3) of section 1031(a) shall 
                        be treated as met if the property to be 
                        received in the exchange is received by the 
                        taxpayer not later than the date which is 3 
                        years after the date on which the taxpayer 
                        transfers the property relinquished in the 
                        exchange.
                    ``(B) Property must be protected in perpetuity.--A 
                contribution shall not be treated as for the purpose 
                referred to in subparagraph (A) unless such purpose is 
                protected in perpetuity.
                    ``(C) Certain property ineligible.--Subparagraph 
                (A) shall not apply to any contribution of property 
                if--
                            ``(i) the property is required (as of the 
                        date of the contribution) to be preserved in 
                        perpetuity in its natural state other than by 
                        reason of the terms of contribution, or
                            ``(ii) the property is required to be 
                        restored or preserved as compensatory 
                        mitigation as a condition of a permit issued 
                        under section 404 of the Federal Water 
                        Pollution Control Act (33 U.S.C. 1344).
                    ``(D) Unused deduction carryover allowed on 
                taxpayer's last return.--In the case of an individual, 
                if--
                            ``(i) the taxpayer dies before the close of 
                        the last taxable year for which a deduction for 
                        a contribution to which subparagraph (A) 
                        applies could have been allowed under 
                        subsection (d)(1), and
                            ``(ii) any portion of the deduction for 
                        such contribution has not been allowed for any 
                        taxable year before the taxable year in which 
                        such death occurs,
                then such portion shall be allowed as a deduction under 
                subsection (a) for the taxable year in which such death 
                occurs without regard to subsection (b), or the unused 
                portion may be used against the estate taxes of the 
                taxpayer.
                    ``(E) Definitions.--For purposes of this 
                paragraph--
                            ``(i) Wetlands.--The term `wetlands' means 
                        any area that is inundated or saturated by 
                        surface or groundwater at a frequency and 
                        duration sufficient to support, and which under 
                        normal circumstances does support, a prevalence 
                        of vegetation typically adapted for life in 
                        saturated soil conditions.
                            ``(ii) Wetlands stewardship trust.--The 
                        term `Wetlands Stewardship Trust' means any 
                        entity designated by the Secretary of the 
                        Interior under section 401 of the Wetlands 
                        Reform Act of 1993.''
    (b) Effective Date.--The amendment made by this section shall apply 
to contributions and gifts made after the date of the enactment of this 
Act in taxable years ending after such date.

SEC. 403. EXCLUSION FROM GROSS INCOME FOR AMOUNTS RECEIVED FROM 
              COMPATIBLE USES OF WETLANDS.

    (a) In General.--Part III of subchapter B of chapter 1 of the 
Internal Revenue Code of 1986 (relating to items specifically excluded 
from gross income) is amended by redesignating section 137 as section 
138 and by inserting after section 136 the following new section:

``SEC. 137. INCOME FROM COMPATIBLE USES OF WETLANDS.

    ``(a) General Rule.--Gross income shall not include any amount 
received by the owner of wetlands for allowing any person to use such 
wetlands in a compatible use.
    ``(b) Definitions.--For purposes of this section--
            ``(1) Wetlands.--The terms `wetlands' has the meaning given 
        such term by section 170(e)(6)(E)(i).
            ``(2) Compatible use.--The term `compatible use' has the 
        meaning given such term in the regulations prescribed under the 
        following sentence. The Secretary of the Interior, acting 
        through the Director of the Fish and Wildlife Service, shall 
        prescribe regulations identifying those activities which 
        constitute compatible uses for purposes of this section, 
        including any pertinent restrictions on such activities. Such 
        activities may include fishing, hunting, and occasional and 
        prudent managed haying, if deemed appropriate by the Secretary 
        of the Interior, but shall not include any activity which 
        degrades the functions or values of wetlands.''
    (b) Clerical Amendment.--The table of sections for such part III is 
amended by striking the last item and inserting the following new 
items:

                              ``Sec. 137. Income from compatible uses 
                                        of wetlands.
                              ``Sec. 138. Cross references to other 
                                        Acts.''
    (c) Effective Date.--The amendments made by this section shall 
apply to amounts received after the date of the enactment of this Act 
in taxable years ending after such date.

                                 <all>

HR 350 SC----2
HR 350 SC----3
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