II

106TH CONGRESS

2D SESSION S. 2881

To update an existing Bureau of Reclamation program by amending the

Small Reclamation Projects Act of 1956, to establish a partnership

program in the Bureau of Reclamation for small reclamation projects,

and for other purposes.

IN THE SENATE OF THE UNITED STATES

JULY 17, 2000

Mr. SMITH of Oregon introduced the following bill; which was read twice and

referred to the Committee on Energy and Natural Resources

A BILL

To update an existing Bureau of Reclamation program by

amending the Small Reclamation Projects Act of 1956,

to establish a partnership program in the Bureau of

Reclamation for small reclamation projects, and for other

purposes.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,

3 SECTION 1. SHORT TITLE.

4 This Act may be cited as ‘‘The Small Reclamation

5 Water Resources Project Act of 2000’’.
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1 SEC. 2. AMENDMENTS TO THE SMALL RECLAMATION

2 PROJECTS ACT OF 1956.

3 (a) PURPOSE.—The first section of the Small Rec4 lamation Projects Act of 1956 (70 Stat. 1044; 43 U.S.C.

5 422a) is amended by striking ‘‘under the’’ and inserting

6 ‘‘under this act and other’’ and by adding the following

7 at the end thereof: ‘‘Such projects may include, but shall

8 not be limited to, irrigation projects. Irrigation shall not

9 be a required purpose for projects receiving assistance

10 under this Act. In providing assistance, the Secretary shall

11 give priority to approved proposals which are related to

12 presently authorized Reclamation projects that will benefit

13 from the work carried out under this Act.’’.

14 (b) DEFINITIONS.—Section 2 of the Small Reclama15 tion Projects Act of 1956 (70 Stat. 1044; 43 U.S.C. 422b)

16 is amended as follows:

17 (1) By amending subsection (c) by striking ‘‘a

18 State’’ and inserting ‘‘an Indian Tribe, a State’’.

19 (2) by amending subsection (d) to read as fol20 lows:

21 ‘‘(d) The term ‘project’ means one of the following:

22 ‘‘(1) A multi-purpose water resource develop23 ment carried out by a non-Federal organization in24 volving significant conservation of water, energy and

25 the environment.
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1 ‘‘(2) The rehabilitation, betterment, or retrofit

2 of any existing Federal or non-Federal water infra3 structure for purposes of complying with law and

4 regulations.

5 ‘‘(3) An activity described in paragraph (1) or

6 (2) that is carried out by a non-Federal organization

7 under the Federal reclamation laws in one or more

8 of the 17 western reclamation States, Hawaii, Alas9 ka, the Commonwealth of Puerto Rico, Guam,

10 American Samoa, the Commonwealth of the North11 ern Mariana Islands, and the Trust Territory of the

12 Pacific Islands. Where such work is proposed for

13 any existing Reclamation project, such work shall be

14 consistent with the authorized purpose as deter15 mined by the Secretary.’’.

16 (3) By striking subsection (f) and inserting:

17 ‘‘(f) the term ‘water quality improvements’ shall

18 mean and involve those operational measures and physical

19 features associated with—

20 ‘‘(1) the reclamation and reuse of irrigation

21 drainage or municipal and industrial return flows,

22 including wastewater flows;

23 ‘‘(2) the reclamation, or control, of brackish,

24 toxic, or hazardous waters for beneficial reuse or
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1 protection of other related water, land, or environ2 mental resources.’’

3 (c) MODIFICATION OF LOAN AND GRANT PRO4 GRAMS.—Strike Sections 3 through 8 of the Small Rec5 lamation Projects Act of 1956 and insert:

6 ‘‘TITLE I—STATE AND LOCAL

7 PARTICIPATION IN RECLAMA8 TION PROJECTS

9 ‘‘SEC. 101. ESTABLISHMENT OF GRANT AND LOAN PRO10 GRAM.

11 ‘‘There is hereby established under this title a pro12 gram within the Bureau of Reclamation, an agency of the

13 Department of the Interior, pursuant to which the Sec14 retary may make grants and loans to organizations to

15 carry out projects as defined in section 2(d).

16 ‘‘SEC. 102. PROPOSAL CONTENTS AND REQUIREMENTS.

17 ‘‘(a) IN GENERAL.—Any organization seeking assist18 ance under this title shall submit a proposal to the Sec19 retary in such form and manner as the Secretary may pre20 scribe. Any proposal for a project submitted under this

21 title shall set forth a plan and estimated cost in detail

22 comparable to those included in preauthorization reports

23 required for a Federal reclamation project.

24 ‘‘(b) LANDS AND WATERS.—Each proposal sub25 mitted under this title shall include a statement of finan-
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1 cial capability and legal authority, and a resolution from

2 the governing board of the organization showing that the

3 organization seeking assistance—

4 ‘‘(1) holds or can acquire all lands and interests

5 in land (except public and other lands and interest

6 in land owned by the United States which are within

7 the administrative jurisdiction of the Secretary and

8 subject to disposition by the Secretary) to complete

9 the project;

10 ‘‘(2) holds or can acquire all rights, pursuant to

11 applicable State law, to the use of water necessary

12 for the successful construction, operation, and main13 tenance of the project; and

14 ‘‘(3) is willing to finance, and capable of financ15 ing, the non-Federal portion of the costs of the

16 project, which portion shall include all costs of ac17 quiring lands, interests in land, and rights to the use

18 of water, except as provided in section 105(b)(2);

19 and

20 ‘‘(4) has the legal authority and responsibility

21 under State law to carry out such work.

22 ‘‘SEC. 103. FEDERAL SHARE AND PROJECT SPONSOR SHARE

23 OF COSTS.

24 ‘‘(a) IN GENERAL.—The Secretary shall require each

25 organization receiving assistance under this title to con-
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1 tribute toward the cost of the project (other than by loan

2 or grant of Federal funds) not less than 25 percent of

3 the allowable estimated costs of the project. In deter4 mining the amount of such non-Federal contribution for

5 the proposed project, the Secretary shall credit toward

6 that amount:

7 ‘‘(1) the cost of investigations, surveys, engi8 neering, and other services necessary for the prepa9 ration of proposals and plans for the proposed

10 project as required by the Secretary;

11 ‘‘(2) the costs of lands and rights-of-way acqui12 sition required for the proposed project;

13 ‘‘(3) amounts spent by the organization for con14 struction or acquisition of facilities for the proposed

15 project prior to project approval; and

16 ‘‘(4) the filing fee required by this Act.

17 ‘‘(b) PREVENTION OF LOSS AND DAMAGE TO FISH

18 AND WILDLIFE.—The costs of measures to prevent loss

19 of, and damage to, existing fish and wildlife resources

20 shall be considered project costs and allocated as may be

21 appropriate among project functions.

22 ‘‘(c) MAXIMUM ALLOWABLE FEDERAL SHARE.—The

23 maximum allowable Federal share per project shall be

24 $30,000,000, as of January 2000. The Secretary shall ad-
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1 just such amount each year using the Bureau of Reclama2 tion’s composite construction cost trends index.

3 ‘‘(d) INCREASE IN AMOUNT.—To compensate for in4 creases in construction costs due to price escalation, sub5 ject to the limitations allowed by subsection (c), the Sec6 retary may increase the amount of the requested loan or

7 grant, or both, at any time prior to the completion of con8 struction of the project, using the Bureau of Reclama9 tion’s composite construction cost trends index.

10 ‘‘SEC. 104. APPROVAL OR DISAPPROVAL OF PROJECTS.

11 ‘‘Not later than one year after the time an initial

12 project proposal is submitted to the Secretary under this

13 title, the Secretary shall make a determination whether

14 the proposal is financially feasible and constitutes a rea15 sonable risk under the provisions of this title and either

16 approve or disapprove the proposal. The Secretary shall

17 promptly transmit any approved proposals to the Con18 gress. The appropriate National Environmental Policy Act

19 (NEPA) documentation for the project shall be completed

20 prior to Secretarial transmittal of the proposal to Con21 gress.

22 ‘‘SEC. 105. CONTRACT TERMS AND CONDITIONS.

23 ‘‘(a) MAXIMUM AMOUNTS AND AVAILABILITY.—

24 Upon approval of any project proposal submitted under

25 this title, the Secretary shall negotiate a contract setting
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1 out the maximum amount of any grant, which shall not

2 exceed 50 percent of the maximum allowable Federal

3 share per grant or loan to be made to the organization,

4 and the time and method of making such grant or loan

5 available to the organization.

6 ‘‘(b) LOANS.—

7 ‘‘(1) The contract for each loan under this title

8 shall contain such terms and conditions as the Sec9 retary deems necessary or proper to provide assur10 ance of, and security for, prompt repayment and to

11 ensure achievement of the purposes for which the

12 loan was made. The contract shall include a plan for

13 repayment by the organization within 25 years, ex14 cept that the organization shall have the right to

15 prepay the loan without penalty.

16 ‘‘(2) The contract for each loan under this title

17 shall require payment of interest and the repayment

18 of the principal of each loan. The Secretary shall fix

19 the interest at a rate determined as of the beginning

20 of the fiscal year in which the contract is executed.

21 The rate shall be based on the average market yield

22 on outstanding marketable obligations of the United

23 States with periods of maturity comparable to the

24 applicable repayment period of the loan.
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1 ‘‘TITLE II—PARTNERSHIP

2 PROGRAM

3 ‘‘SEC. 201. ESTABLISHMENT OF PARTNERSHIP PROGRAM.

4 ‘‘(a) PROGRAM.—There is hereby established within

5 the Bureau of Reclamation, an agency of the Department

6 of the Interior, a small grant and loan program to be

7 known as the Small Reclamation Water Resources Man8 agement Partnership Program, to be carried out under

9 this title. The purpose of this program shall be to imple10 ment projects that can be performed—

11 ‘‘(1) by the recipient organization’s workforce

12 or contractors,

13 ‘‘(2) with streamlined documentation, and

14 ‘‘(3) in a period of 18 months or less.

15 ‘‘(b) GRANTS.—Grants under this title shall not ex16 ceed $2,500,000 for any one project under such program,

17 and shall be matched on a 50-percent basis of total eligible

18 cost by the organization.

19 ‘‘(c) LOANS.—Loans under this title shall not exceed

20 $2,500,000 per project, and shall be subject to cost shar21 ing in the same manner as provided in title I. The contract

22 for each loan under this title shall require payment of in23 terest and repayment of the principal. The Secretary shall

24 fix the interest rate in the same manner as provided in

25 section 105(c)(2) for loans under title I.
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1 ‘‘(d) LIMITATION.—The Secretary is authorized to

2 use up to $50,000,000 of the amount available under this

3 Act for the purposes of this title.

4 ‘‘SEC. 202. REPAYMENT OF LOANS.

5 ‘‘Once work is certified complete by the Secretary,

6 each loan made under this title shall be repaid within a

7 5-year period.

8 ‘‘SEC. 203. ACTIVITIES ELIGIBLE UNDER THE SMALL REC9 LAMATION WATER RESOURCES PARTNER10 SHIP.

11 ‘‘(a) IN GENERAL.—The following types of activities

12 shall be eligible for grants or loans under this title: water

13 conservation; water quality improvement projects; water

14 management for urban landscapes; drought assistance;

15 fish and wildlife improvements; and public safety improve16 ments.

17 ‘‘(b) ADDITIONAL ACTIVITIES.—The Secretary may

18 add to the list referred to in subsection (a) as he deems

19 appropriate, except that any such addition shall not take

20 effect until 60 days after the Secretary publishes a notice

21 of the proposed addition in the Federal Register, and has

22 notified the Committee on Resources of the House of Rep23 resentatives and the Committee on Energy and Natural

24 Resources of the United States Senate in writing of the

25 proposed addition and the reasons therefore.
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1 ‘‘SEC. 204. APPLICATION PROCESS.

2 ‘‘(a) NOTICE OF INTENT.—Each organization seek3 ing a grant or loan under this title shall submit a Notice

4 of Intent to the Secretary by April 1 of each year outlining

5 the proposed project and the public benefits thereof. With6 in two months, the Secretary shall provide a written re7 sponse to the applicant, either affirming or rejecting the

8 Bureau of Reclamation’s interest in participating in the

9 project.

10 ‘‘(b) NOTICE OF FEDERAL INTEREST.—Upon notifi11 cation of the Bureau of Reclamation’s interest, the organi12 zation seeking assistance under this title shall have the

13 option of proceeding with an appropriate loan or grant ap14 plication giving details of the project and the anticipated

15 public benefits.

16 ‘‘(c) CONTENTS.—The contents of any project pro17 posal under this title shall include, but need not be limited

18 to, each of the following:

19 ‘‘(1) A resolution by the board of directors of

20 the qualifying organization stating—

21 ‘‘(A) the total estimated project cost;

22 ‘‘(B) the amount of the grant or loan re23 quested;

24 ‘‘(C) the amount of the non-Federal con25 tribution for the grant;
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1 ‘‘(D) the organization’s ability to finance

2 and construct the project; and

3 ‘‘(E) the project objectives.

4 ‘‘(2) A summary of the proposal.

5 ‘‘(3) A brief description of the anticipated ef6 fects of the project on the environment.

7 ‘‘(4) Evidence that the organization seeking as8 sistance under this title has all lands and water

9 rights needed for the project, or can obtain them

10 and has legal authority and responsibility under

11 state law to carry out such work in the project plan.

12 ‘‘(5) A description of the project plan, including

13 a general map showing the location of proposed

14 physical features, conceptual engineering drawings

15 of major and typical structures, and general stand16 ards for design.

17 ‘‘(6) A construction schedule, with dates and

18 schedule of funding requirements under this title, in

19 sufficient detail to provide an analysis of the pro20 posed construction program.

21 ‘‘(7) An identification of those portions of the

22 project costs which constitute the Federal grant or

23 loan amounts and the applicant’s local contribution.

24 ‘‘(d) COSTS.—The cost of any investigations and

25 preparation of any environmental documentation shall be
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1 borne by the project applicant and any such costs shall

2 be credited as part of the local cost share for grant fund3 ing.

4 ‘‘(e) ANNUAL LISTING.—The Secretary shall include

5 in the annual budget justification for the Bureau of Rec6 lamation, a listing of the activities and total funding re7 quired for work committed under this title.

8 ‘‘SEC. 205. TERMS AND CONDITIONS OF PROJECT WORK.

9 ‘‘The Secretary shall examine the proposal submitted

10 under this title to determine if the project can reasonably

11 be expected to accomplish its purpose, and approve or dis12 approve such proposal by September 1 of each year. Once

13 approved by the Secretary and subject to the availability

14 of appropriations, funding shall be provided within 60

15 days for the schedule of work within that fiscal year.

16 ‘‘SEC. 206. ELIGIBILITY.

17 ‘‘Such proposals shall only be made by organizations

18 that have legal authority and responsibility for such work

19 to be carried out on those projects under state law. Only

20 one proposal per project area shall be allowed per every

21 five year period.
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1 ‘‘TITLE III—LOAN GUARANTEES

2 ‘‘SEC. 301. ESTABLISHMENT OF LOAN GUARANTEE PRO3 GRAM.

4 ‘‘There is hereby established within Bureau of Rec5 lamation a demonstration program under this title to

6 guarantee loans for projects receiving, or eligible to re7 ceive, loans or grants under title I or II of this Act.

8 ‘‘SEC. 302. PROGRAM REQUIREMENTS.

9 ‘‘(a) IN GENERAL.—The Secretary may provide sup10 port under the demonstration program to organizations

11 through the provision of loan guarantees to such pro12 grammatic needs as authorized under titles I and II of

13 this Act, under such terms and conditions specified in this

14 section and under applicable laws. Any proposal for a

15 project submitted under this title shall set forth a plan

16 and estimated costs in detail comparable to those included

17 in preauthorization reports required for a Federal rec18 lamation project.

19 ‘‘(b) FUNDING LIMIT.—Up to 10 percent of the

20 amounts authorized to be appropriated under this Act

21 shall be set aside for purposes of funding the cost of loan

22 guarantees under this title. The amounts allocated to each

23 loan guarantee shall be the cost of such guarantee cal24 culated in accordance with applicable provisions of Federal

25 law.
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1 ‘‘(c) SELECTION OF RECIPIENTS.—The Secretary

2 shall adopt and use competitive procedures in the selection

3 of organizations to receive loan guarantees under this sec4 tion. In selecting the organizations to receive a loan guar5 antee under this section, the Secretary shall consider, at

6 a minimum, the following:

7 ‘‘(1) The extent to which the loan guarantees

8 would support new water supplies or more efficient

9 use of existing supplies.

10 ‘‘(2) The repayment period of the guaranteed

11 loan.

12 ‘‘(3) The extent to which the loan guarantee

13 would provide for a project of wide public purpose.

14 ‘‘(4) Whether the loan guarantee would help the

15 organization receiving the guarantee meet a Federal

16 or State environmental statute or mandate.

17 ‘‘(5) The ability of the loan guarantee to meet

18 the needs of other local water purveyors.

19 ‘‘(6) The extent to which the guaranteed loan

20 would support a program that would supplement,

21 rather than duplicate, other available water resource

22 programs.

23 ‘‘(7) The fiscal impact of the loan guarantee

24 program as a whole on other reclamation programs.
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1 ‘‘(d) APPORTIONMENT.—The total amount made

2 available to the Secretary for a fiscal year to cover the

3 costs of loan guarantees under this section shall be divided

4 between projects receiving or eligible to receive loans

5 under titles I and II, with title I projects receiving 75 per6 cent and title II projects receiving 25 percent.

7 ‘‘(e) MAXIMUM.—The maximum allowable guarantee

8 percentage for loans guaranteed under this section may

9 be up to 75 percent of the total project cost. No loan guar10 antee under this title shall be used to cover the organiza11 tion’s local cost share for any project assisted under this

12 Act.

13 ‘‘(f) REPORTING.—Reporting and documentation re14 quirements authorized under amendments contained in ti15 tles I and II shall similarly apply to loan guarantee

16 projects.

17 ‘‘(g) STATE LAW.—For purposes of this Act, when

18 any bonds are issued by an organization to help finance

19 a project for which the organization is also receiving a loan

20 guarantee under this section such bonds shall not be treat21 ed as affecting the tax-exempt status of such bonds under

22 applicable State law.

23 ‘‘(h) FULL FAITH AND CREDIT.—Any loan guarantee

24 issued pursuant to this section shall constitute an obliga25 tion, in accordance with the terms of such guarantee, of
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1 the United States Government, and the full faith and cred2 it of the United States is hereby pledged to the full per3 formance of the obligations.

4 ‘‘(i) REPORT.—At the end of the third fiscal year

5 after the enactment of this Act, the Secretary shall submit

6 a report to the Congress on the beneficial use and sug7 gested improvements associated with the use of loan guar8 antees as a mechanism for project construction.

9 ‘‘SEC. 303. SUNSET.

10 ‘‘No loan guarantee may be issued under this title

11 in any fiscal year after the expiration of 6 full fiscal years

12 after initial funding of projects under ‘The Small Rec13 lamation Water Resources Project Act of 2000’.

14 ‘‘TITLE IV—GENERAL

15 PROVISIONS

16 ‘‘SEC. 401. PROPOSAL FEE.

17 ‘‘Each proposal for a loan, grant, or loan guarantee

18 under this Act shall be accompanied by a minimum pay19 ment of $5,000 or one percent of the Federal share,

20 whichever is greater, or portion thereof to defray in part

21 the costs of examining the proposal. Fifty percent of the

22 payment shall accompany the application and the remain23 ing 50 percent shall be due upon approval of the project

24 by the Secretary, if approved.
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1 ‘‘SEC. 402. MISCELLANEOUS PROVISIONS.

2 ‘‘(a) TITLE.—Title to all project works and facilities

3 constructed with assistance under this Act shall remain

4 in the name of the organization.

5 ‘‘(b) COMBINED LOANS, GRANTS, AND LOAN GUAR6 ANTEES.—A project sponsor shall be eligible for a loan,

7 grant, loan guarantee, or combination thereof for a project

8 proposal under this Act. No organization shall be eligible

9 for an additional loan, grant, loan guarantee, or any com10 bination thereof for the same project that has previously

11 received a loan, grant, or loan guarantee under this Act

12 within the prior five fiscal years.

13 ‘‘(c) PLANNING, CONSTRUCTION, OPERATION, AND

14 MAINTENANCE.—The United States shall not be required

15 to provide planning, construction, operation, and mainte16 nance of any project receiving a loan, grant or loan guar17 antee under this Act.

18 ‘‘(d) STATE WATER LAW.—Any project assisted

19 under this Act shall be carried out in accordance with ap20 plicable State water law.’’.

21 (d) CONFORMING AMENDMENTS.—

22 (1) Sections 9 through 13 of the Small Rec23 lamation Projects Act of 1956 are redesignated as

24 sections 403 through 407 respectively.
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1 (2) Section 404 of such Act, as redesignated by

2 paragraph (1) of this subsection, is amended as fol3 lows:

4 (A) By striking ‘‘section 3’’ and inserting

5 ‘‘title I’’.

6 (B) By striking ‘‘effective October 1,

7 1986.’’ and inserting ‘‘for any fiscal year’’.

8 (C) By striking ‘‘for loans and grants pur9 suant to this Act’’ and inserting ‘‘for loans and

10 grants pursuant to title I’’.

11 (D) By striking ‘‘five years after the date

12 of enactment of this Act’’ and inserting ‘‘five

13 years after the date of enactment of ‘The Small

14 Reclamation Water Resources Project Act of

15 2000’ ’’.

16 (E) By striking ‘‘section 4(c)’’ and insert17 ing ‘‘title I’’.

18 SEC. 3. GUIDELINES.

19 Within 180 days after enactment of this Act, the Sec20 retary of the Interior shall complete and publish in the

21 Federal Register such administrative guidelines as may be

22 necessary to carry out the amendments made by this Act.

23 SEC. 4. PURPOSES.

24 The purpose for fish, wildlife and environmental ac25 tivities carried out under this Act are in the form of miti-
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1 gation and avoidance of listed species and critical habitat

2 as required by law and regulation as a direct result of con3 struction, operation and maintenance activities for new or

4 existing projects.

5 SEC. 5. EFFECTIVE DATE.

6 The amendments made by this Act shall take effect

7 on the date of enactment. Nothing in this Act or in any

8 amendment made by this Act shall affect any loan or

9 grant that has been approved before the date of enactment

10 of this Act.

11 SEC. 6. LIMITATION.

12 Activities funded under this Act shall not be consid13 ered a supplemental or additional benefit under the Act

14 of June 17, 1902 (82 Stat. 388) and all Acts amendatory

15 thereof or supplementary thereto.

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