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[Congressional Bills 111th Congress]
[From the U.S. Government Publishing Office]
[H.R. 5509 Introduced in House (IH)]

111th CONGRESS
  2d Session
                                H. R. 5509

To support efforts to reduce pollution of the Chesapeake Bay watershed 
and to verify that reductions in pollution have been achieved, and for 
                            other purposes.

_______________________________________________________________________

                    IN THE HOUSE OF REPRESENTATIVES

                             June 10, 2010

  Mr. Holden (for himself and Mr. Goodlatte) introduced the following 
    bill; which was referred to the Committee on Transportation and 
Infrastructure, and in addition to the Committee on Agriculture, for a 
 period to be subsequently determined by the Speaker, in each case for 
consideration of such provisions as fall within the jurisdiction of the 
                          committee concerned

_______________________________________________________________________

                                 A BILL

 
To support efforts to reduce pollution of the Chesapeake Bay watershed 
and to verify that reductions in pollution have been achieved, 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; TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``Chesapeake Bay 
Program Reauthorization and Improvement Act''.
    (b) Table of Contents.--The table of contents for this Act is as 
follows:

Sec. 1. Short title; table of contents.
Sec. 2. Modification of Chesapeake Bay Program under Clean Water Act.
Sec. 3. Establishment of independent commission to oversee and 
                            administer nutrient and sediment trading 
                            program for Chesapeake Bay States.
Sec. 4. Chesapeake Bay watershed assurance standards.
Sec. 5. Technical guidelines for environmental services markets.
Sec. 6. Chesapeake Bay watershed pilot program for creating 
                            environmental service markets.

SEC. 2. MODIFICATION OF CHESAPEAKE BAY PROGRAM UNDER CLEAN WATER ACT.

    (a) Definitions.--Section 117(a) of the Federal Water Pollution 
Control Act (33 U.S.C. 1267(a)) is amended--
            (1) by redesignating paragraphs (5) and (6) as paragraphs 
        (6) and (9), respectively;
            (2) by inserting after paragraph (4) the following new 
        paragraph:
            ``(5) Chesapeake bay state.--The term `Chesapeake Bay 
        State' or `State' means Delaware, Maryland, New York, 
        Pennsylvania, Virginia, West Virginia, and the District of 
        Columbia.''; and
            (3) by inserting after paragraph (6), as redesignated, the 
        following new paragraphs:
            ``(7) Chief executive.--The term `chief executive' means--
                    ``(A) in the case of a State or Commonwealth, the 
                Governor of the State or Commonwealth; and
                    ``(B) in the case of the District of Columbia, the 
                Mayor of the District of Columbia.
            ``(8) Restoration activities.--The term `restoration 
        activities' means any Federal or State programs that directly 
        protect, conserve, or restore habitat, water resources, or 
        water quality in the Chesapeake Bay watershed, including 
        programs that promote responsible land use and stewardship in 
        the Chesapeake Bay ecosystem.''.
    (b) Chesapeake Bay Crosscut Financial Report.--Section 117 of the 
Federal Water Pollution Control Act (33 U.S.C. 1267) is amended by 
striking subsection (j) and inserting the following new subsection:
    ``(j) Financial Report.--
            ``(1) Financial report required.--Beginning with the budget 
        submission for fiscal year 2012, the Director of the Office of 
        Management and Budget, in consultation with other appropriate 
        Federal agencies and the chief executive of each Chesapeake Bay 
        State, shall submit to Congress a financial report containing--
                    ``(A) a summary of an interagency crosscut budget 
                that displays--
                            ``(i) the proposed funding for any Federal 
                        restoration activity to be carried out in the 
                        succeeding fiscal year, including any planned 
                        interagency or intra-agency transfer, for each 
                        of the Federal agencies that carry out 
                        restoration activities;
                            ``(ii) to the extent that information is 
                        available, the estimated funding for any State 
                        restoration activity to be carried out in the 
                        succeeding fiscal year;
                            ``(iii) all expenditures for Federal 
                        restoration activities from the preceding 3 
                        fiscal years, the current fiscal year, and the 
                        succeeding fiscal year; and
                            ``(iv) all expenditures, to the extent that 
                        information is available, for State restoration 
                        activities during the equivalent time period 
                        described in clause (iii);
                    ``(B) a detailed accounting of all funds received 
                and obligated by all Federal agencies for restoration 
                activities during the current and preceding fiscal 
                years, including the identification of funds which were 
                transferred to a Chesapeake Bay State for restoration 
                activities;
                    ``(C) to the extent that information is available, 
                a detailed accounting from each State of all funds 
                received and obligated from a Federal agency for 
                restoration activities during the current and preceding 
                fiscal years; and
                    ``(D) a description of each of the proposed Federal 
                and State restoration activities to be carried out in 
                the succeeding fiscal year (corresponding to those 
                activities listed in clauses (i) and (ii) of 
                subparagraph (A)).
            ``(2) Submission.--Not later than 30 days after the 
        submission by the President of the annual budget to Congress, 
        the Director shall submit the report required by paragraph (1) 
        to the following congressional committees:
                    ``(A) The Committees on Agriculture, 
                Appropriations, Natural Resources, Energy and Commerce, 
                and Transportation and Infrastructure of the House of 
                Representatives.
                    ``(B) The Committees on Agriculture, Nutrition, and 
                Forestry, Appropriations, Environment and Public Works, 
                and Commerce, Science, and Transportation of the 
                Senate.''.
    (c) Transparency and Accountability.--Section 117 of the Federal 
Water Pollution Control Act (33 U.S.C. 1267) is amended by adding at 
the end the following new subsection:
    ``(k) Transparency and Accountability Requirements.--
            ``(1) State reports.--Not later than 10 days after the end 
        of each calendar quarter, each State that received funds from a 
        Federal agency under subsection (n)(1)(B) shall submit a report 
        to the head of the agency that--
                    ``(A) identifies the total amount of funds received 
                from the agency under such provisions during the 
                preceding calendar quarter;
                    ``(B) identifies the amount of funds received from 
                the agency under such provisions during the preceding 
                calendar quarter or earlier that were obligated or 
                expended for projects or activities during the 
                preceding calendar quarter; and
                    ``(C) contains a list of all projects or activities 
                for which the funds were obligated or expended, except 
                that such list shall not include personal identifying 
                information of individual recipients.
            ``(2) Agency reports.--Not later than 30 days after the end 
        of each calendar quarter, the head of each Federal agency that 
        made funds available under subsection (n)(1)(B) to any State 
        shall provide the information received in reports submitted 
        under paragraph (1) to the Administrator. The Administrator 
        shall publish the information on a publicly available website, 
        as provided in paragraph (4).
            ``(3) Initial compliance.--Not later than 180 days after 
        the date of the enactment of the Chesapeake Bay Program 
        Reauthorization and Improvement Act, the head of each Federal 
        agency providing funds under subsection (n)(1)(B) shall 
        require, as a condition of receipt of the funds, a State 
        recipient of the funds to provide the information required 
        under paragraph (1).
            ``(4) Website.--
                    ``(A) Website required.--The Administrator shall 
                establish and maintain, no later than 30 days after 
                enactment of the Chesapeake Bay Program Reauthorization 
                and Improvement Act, a user-friendly, public-facing 
                website to foster greater accountability and 
                transparency in the use of funds provided under 
                subsection (n)(1)(B).
                    ``(B) Content and function.--The website shall 
                provide the following:
                            ``(i) Accountability information, including 
                        findings from audits, inspectors general, and 
                        the Government Accountability Office.
                            ``(ii) Data on relevant economic, 
                        financial, grant, and contract information in 
                        user-friendly visual presentations to enhance 
                        public awareness of the use of covered funds.
                            ``(iii) Links to other government websites 
                        where key information relating to efforts to 
                        improve the water quality of the Chesapeake Bay 
                        watershed may be found.
                            ``(iv) Printable reports on covered funds 
                        obligated by month to each State and 
                        congressional district.
                            ``(v) Links to other government websites 
                        with information concerning covered funds, 
                        including Federal agency and State websites.
                    ``(C) Revisions.--The Administrator shall enhance 
                and update the website as necessary.''.
    (d) Independent Evaluation and Technical Advisory Committee for 
Chesapeake Bay Program.--Section 117 of the Federal Water Pollution 
Control Act (33 U.S.C. 1267) is amended by inserting after subsection 
(k), as added by subsection (c), the following new subsection:
    ``(l) Independent Evaluation and Technical Advisory Committee.--
            ``(1) Establishment; purpose.--There shall be an 
        Independent Evaluation and Technical Advisory Committee (in 
        this subsection referred to as the `advisory committee') 
        established to review and report on restoration activities in 
        the Chesapeake Bay ecosystem, including relevant topics 
        suggested by the Chesapeake Executive Council and the 
        Chesapeake Bay Commission
            ``(2) Appointment.--The Administrator and the Secretary of 
        Agriculture shall appoint the members of the advisory 
        committee, which shall consist of the following members:
                    ``(A) One individual affiliated with an institution 
                of higher education who has expertise in water quality.
                    ``(B) Two individuals who are engineers or 
                scientists from government and academia who have 
                expertise in water quality modeling.
                    ``(C) Two individuals with professional experience 
                and expertise concerning urban and agricultural storm 
                water issues.
                    ``(D) One individual with professional experience 
                and expertise concerning urban and suburban 
                development.
                    ``(E) One individual with professional experience 
                and expertise regarding water quality modeling.
                    ``(F) One individual affiliated with an 
                environmental or conservation organization.
                    ``(G) One individual affiliated with agriculture 
                farm commodity programs.
                    ``(H) One individual affiliated with agriculture 
                conservation programs.
                    ``(I) One individual with professional experience 
                and expertise in economics.
                    ``(J) One individual with professional experience 
                and expertise in agronomy, crop science, or soil 
                science.
                    ``(K) One individual with professional experience 
                and expertise in wastewater treatment systems.
                    ``(L) One individual with professional experience 
                and expertise in marine biology or fish and wildlife 
                habitats.
                    ``(M) One individual with professional experience 
                and expertise in implementing building permits.
            ``(3) Term.--A member of the advisory committee shall be 
        appointed for a term of two years and is limited to three terms 
        on the advisory committee.
            ``(4) Bylaws.--The advisory committee shall establish such 
        bylaws as may be appropriate to enable the advisory committee 
        to carry out its duties under this subsection. Such bylaws 
        shall include provisions to prevent any conflict of interest, 
        or the appearance of any conflict of interest, in the actions 
        taken or recommendations made by the advisory committee or by 
        any member. As an advisory committee, the committee has no 
        power to promulgate regulations.
            ``(5) Administrative support.--The Department of 
        Agriculture shall be the administering agency for the advisory 
        committee.
            ``(6) Duties.--
                    ``(A) Administration review.--The advisory 
                committee shall provide recommendations to the 
                Administrator and Secretary of Agriculture concerning 
                administration of this section.
                    ``(B) Program and activities review.--The advisory 
                committee shall review, and provide recommendations to 
                the Administrator and Secretary of Agriculture 
                concerning, whether--
                            ``(i) funds authorized for the restoration 
                        activities are distributed and used in a manner 
                        that are consistent with the objectives of 
                        improving the water quality in the Chesapeake 
                        Bay ecosystem;
                            ``(ii) mechanisms are in place to ensure 
                        that restoration activities are properly 
                        implemented;
                            ``(iii) mechanisms are in place to ensure 
                        that progress toward water quality goals for 
                        the Chesapeake Bay ecosystem are achieved;
                            ``(iv) the allocation of funds reflects 
                        each Chesapeake Bay State's responsibility and 
                        contribution towards achieving water quality 
                        goals;
                            ``(v) restoration activities are carried 
                        out in accordance with this section; and
                            ``(vi) the factual information and 
                        assumptions incorporated in the Chesapeake Bay 
                        model are accurate.
                    ``(C) Report.--Not later than December 31, 2011, 
                and every two years thereafter, the advisory committee 
                shall submit to the Administrator, the Secretary of 
                Agriculture, and Congress regarding progress made 
                toward reaching water quality goals in the Chesapeake 
                Bay ecosystem.
            ``(7) Coordination.--To avoid duplication of effort, the 
        advisory committee shall coordinate activities with other 
        Federal advisory committees working in related areas.
            ``(8) Meetings.--The advisory committee shall meet at least 
        quarterly.
            ``(9) No regulatory authority.--The advisory committee does 
        not have the authority to recommend or promulgate 
        regulations.''.
    (e) Nutrient and Sediment Trading Technical Guidelines.--Section 
117 of the Federal Water Pollution Control Act (33 U.S.C. 1267) is 
amended by inserting after subsection (l), as added by subsection (d), 
the following new subsection:
    ``(m) Nutrient and Sediment Trading Technical Guidelines.--
            ``(1) Establishment.--Not later than May 12, 2012, the 
        Administrator, in consultation with the Secretary of 
        Agriculture and Chesapeake Bay States shall establish technical 
        guidelines to be used by the Chesapeake Bay Nutrient and 
        Sediment Trading Commission in establishing an interstate 
        nutrient and sediment trading program for the Chesapeake Bay. 
        Such guidelines shall not apply to agricultural and non-
        industrial private forest lands.
            ``(2) Elements.--The technical guidelines established under 
        this subsection shall, at a minimum--
                    ``(A) define and standardize nutrient and sediment 
                credits and establish procedures or standards for 
                ensuring equivalent water quality benefits for all 
                credits;
                    ``(B) establish procedures or standards for 
                nutrient and sediments credits to ensure that credit-
                generating practices from both point sources and 
                nonpoint sources (excluding agricultural and forest 
                lands) are achieving reductions in nutrient and 
                sediments;
                    ``(C) establish procedures or standards for 
                generating, quantifying, trading, banking, and applying 
                credits to meet regulatory requirements;
                    ``(D) establish baseline requirements, relevant to 
                the credit being traded, that a credit seller must meet 
                before becoming eligible to generate saleable credits; 
                and
                    ``(E) incorporate an approach under the national 
                pollutant discharge elimination system established 
                under section 402 that creates a general approval for 
                trading, thereby avoiding the need to reopen or reissue 
                permits to incorporate individual trades.''.
    (f) Authorization of Appropriations and Grant Authority.--Section 
117 of the Federal Water Pollution Control Act (33 U.S.C. 1267) is 
amended by inserting after subsection (m), as added by subsection (e), 
the following new subsection:
    ``(n) Authorization of Appropriations; Grants.--
            ``(1) In general.--There are authorized to be appropriated 
        to the Administrator for each of fiscal years 2010 through 
        2015--
                    ``(A) such sums as are necessary to carry out this 
                section; and
                    ``(B) such sums as may be necessary to support the 
                Chesapeake Bay States in carrying out section 303(d), 
                with priority given to Maryland, Virginia, 
                Pennsylvania, and District of Columbia, which shall be 
                distributed in the following percentages and for the 
                following purposes:
                            ``(i) 30 percent for grants to any 
                        municipal, intermunicipal, interstate, or State 
                        agency for construction of publicly owned 
                        treatment works, as defined in section 212.
                            ``(ii) 35 percent for grants to any 
                        municipality that operates a municipal separate 
                        stormwater sewage system under section 402(p).
                            ``(iii) 35 percent to the Secretary of 
                        Agriculture to carry out section 1240Q(i) of 
                        the Food Security Act of 1985 (16 U.S.C. 
                        3839bb-4(i)).
            ``(2) Availability of funds.--Amounts appropriated pursuant 
        to the authorization of appropriations in paragraph (1) shall 
        remain available until expended.
            ``(3) Reservation of funds for states.--
                    ``(A) Reservation percentages.--Of the amounts 
                appropriated pursuant to the authorization of 
                appropriations in paragraph (1)(B), the Administrator 
                shall reserve the following percentages for allocation 
                pursuant to subparagraph (B):
                            ``(i) 10 percent in fiscal year 2011.
                            ``(ii) 20 percent in fiscal year 2013.
                            ``(iii) 50 percent in fiscal year 2015.
                    ``(B) Allocation to states.--The Administrator 
                shall allot the amounts reserved pursuant to 
                subparagraph (A) among States in each fiscal year based 
                on the Administrator's finding, in consultation with 
                the Secretary of Agriculture, that the States have made 
                sufficient progress toward meeting water quality goals 
                and are properly managing financial resources intended 
                to enable each State in meeting its water quality 
                goals. The Administrator, in consultation with the 
                Secretary, shall base the finding upon the report of 
                the advisory committee required under subsection 
                (l).''.
    (g) Total Maximum Daily Load for Nitrogen, Phosphorus, or Sediment 
for Chesapeake Bay.--Section 117 of the Federal Water Pollution Control 
Act (33 U.S.C. 1267) is amended by inserting after subsection (n), as 
added by subsection (f), the following new subsection:
    ``(o) Total Maximum Daily Load for Nitrogen, Phosphorus, or 
Sediment for Chesapeake Bay.--
            ``(1) TMDL duration.--A total maximum daily load 
        established under section 303(d) for nitrogen, phosphorus, or 
        sediment for the Chesapeake Bay and its tributaries may include 
        load expressions for wasteload allocations or load allocations 
        using time frames other than daily (such as annual, monthly, or 
        seasonal) for sectors, including agriculture, where non-daily 
        wasteload or load allocations are most appropriate to implement 
        applicable water quality standards.
            ``(2) Adaptive management.--If a Chesapeake Bay State 
        develops a plan to implement a total maximum daily load under 
        section 303(d) for phosphorus, nitrogen, or sediment for the 
        Chesapeake Bay or its tributaries that provides for reductions 
        in loading through an iterative process that employs adaptive 
        management principles, permits may be issued under section 402 
        for new or existing discharges that include waste load 
        allocations consistent with the plan and that demonstrate 
        progress towards achieving the waste load allocation, whether 
        by treatment, trading, or other means, in accordance with the 
        schedule provided in the plan, as determined by the permit 
        issuing authority. In assessing sufficient progress by 
        municipal dischargers and other point sources toward meeting 
        water quality goals and plans, the Administrator and the States 
        should take into account the availability, cost, effectiveness, 
        and appropriateness of practices, techniques, methods, or other 
        provisions for the control of such pollutants to meet the 
        requirements of section 402(p).
            ``(3) Options for offsetting of stormwater management 
        requirements.--In order to meet Federal or State water quality 
        requirements in the Chesapeake Bay ecosystem, an individual or 
        entity undertaking land development activities requiring the 
        management of stormwater by on-site infiltration shall be 
        permitted to meet the applicable infiltration requirements by 
        paying to offset them through the establishment of equivalent 
        stormwater management practices off-site within the Chesapeake 
        Bay ecosystem. Offsetting stormwater management practices shall 
        include, at a minimum, the establishment on agricultural lands 
        of riparian forest buffers, streambank fencing, or other best 
        management practices.''.

SEC. 3. ESTABLISHMENT OF INDEPENDENT COMMISSION TO OVERSEE AND 
              ADMINISTER NUTRIENT AND SEDIMENT TRADING PROGRAM FOR 
              CHESAPEAKE BAY STATES.

    The Federal Water Pollution Control Act is amended by inserting 
after section 117 (33 U.S.C. 1267) the following new section:

``SEC. 117A. CHESAPEAKE BAY NUTRIENT AND SEDIMENT TRADING COMMISSION.

    ``(a) Definitions.--In this section:
            ``(1) Commission.--The term `Commission' means the 
        Chesapeake Bay Nutrient and Sediment Trading Commission.
            ``(2) Chesapeake bay state.--The term `Chesapeake Bay 
        State' means Delaware, Maryland, New York, Pennsylvania, 
        Virginia, West Virginia, and the District of Columbia.
            ``(3) Chesapeake executive council.--The term `Chesapeake 
        Executive Council' means the signatories to the Chesapeake Bay 
        Agreement.
            ``(4) Chesapeake bay agreement.--The term `Chesapeake Bay 
        Agreement' means the formal, voluntary agreements executed to 
        achieve the goal of restoring and protecting the Chesapeake Bay 
        ecosystem and the living resources of the Chesapeake Bay 
        ecosystem and signed by the Chesapeake Executive Council.
            ``(5) Nutrient.--The term `nutrient' means nitrogen and 
        phosphorous.
    ``(b) Establishment of Commission; Purpose.--
            ``(1) In general.--There is established a Chesapeake Bay 
        Nutrient and Sediment Trading Commission to oversee and 
        administer the nitrogen and phosphorus trading program for the 
        Chesapeake Bay States to insure credits are generated to 
        attract market participants and facilitate trading mechanisms 
        among and within States to meet water quality goals.
            ``(2) Independent establishment.--The Commission shall be 
        an independent establishment, as defined in section 104 of 
        title 5, United States Code.
            ``(3) Location.--The Commission shall be housed at the 
        Office of the Chesapeake Bay Program directed by the Chesapeake 
        Executive Council in accordance with the Chesapeake Bay 
        Agreement.
    ``(c) Duties.--
            ``(1) Credits for water quality trading.--In consultation 
        with market developers and appropriate Federal agencies, the 
        Commission shall develop a system to facilitate and generate 
        credits for interstate water quality trading in the Chesapeake 
        Bay States.
            ``(2) Water quality trading registry.--The Commission shall 
        obtain information from the Administrator, the Secretary of 
        Agriculture, and other Federal agencies to operate and oversee 
        a registry for interstate water quality trading in the 
        Chesapeake Bay States.
            ``(3) Trade recordkeeping.--The Commission shall develop 
        and maintain a system to record specific interstate water 
        quality trades in the Chesapeake Bay States.
            ``(4) Point source and non-point source trades.--In 
        consultation with market developers and appropriate Federal 
        agencies, the Commission shall develop a system to allow for 
        trading to occur between point source and non-point source 
        dischargers in the Chesapeake Bay States.
            ``(5) Consistency with state program.--The Commission shall 
        not establish or operate a program that conflicts with or 
        modifies a State program.
    ``(d) Use of Technical Guidelines.--The Commission shall rely on 
the Administrator to provide technical guidelines under section 117(m) 
and the Secretary of Agriculture to provide technical guidelines under 
section 1245(b) of the Food Security Act of 1985 (16 U.S.C. 3845(b)).
    ``(e) Members of Commission.--
            ``(1) Composition.--The Commission shall consist of five 
        members, of which--
                    ``(A) one member shall be appointed by the 
                Secretary of Agriculture;
                    ``(B) one member shall be appointed by the 
                Administrator of the Environmental Protection Agency; 
                and
                    ``(C) three members shall be appointed by the 
                governors from each of the signatory States of the Bay 
                Agreement.
            ``(2) Special considerations.--With regard to the members 
        appointed under paragraph (1)(C)--
                    ``(A) one member shall be a representative of the 
                general public;
                    ``(B) not more than two of the members may have 
                similar professional experience or expertise in the 
                same field; and
                    ``(C) at least one of the members shall be 
                experienced in a market based pollutant trading 
                mechanism.
            ``(3) Terms.--The members of the Commission shall serve a 
        term of five years and may be reappointed.
            ``(4) Chairperson.--The members of the Commission shall 
        designate one of the members to serve as chairperson.
            ``(5) Meetings.--The Commission shall meet at the call of 
        the chairperson or a majority of its members.
    ``(f) Officers and Staff.--The Commission may appoint, employ, fix 
the pay of, and provide other allowances and benefits for such officers 
and employees of the Commission as the members determine to be 
appropriate.
    ``(g) Duration.--The Commission shall terminate on September 30, 
2015.''.

SEC. 4. CHESAPEAKE BAY WATERSHED ASSURANCE STANDARDS.

    Section 1240Q of the Food Security Act of 1985 (16 U.S.C. 3839bb-4) 
is amended by adding at the end the following new subsection:
    ``(i) Chesapeake Bay Watershed Assurance Standards.--
            ``(1) Purpose.--The purpose of this subsection is to 
        develop environmental assurance standards for the Chesapeake 
        Bay States to use to ensure that farmers and non-industrial 
        private forest landowners in the Chesapeake Bay watershed are 
        implementing conservation activities to fulfill water quality 
        regulations under applicable Federal and State law.
            ``(2) Duties of secretary.--
                    ``(A) Establishment of standards.--For the purposes 
                of this section, the Secretary shall use existing State 
                partnerships and programs to establish standards for 
                risk assessment, conservation planning, verification, 
                water quality, and auditing practices that Chesapeake 
                Bay States can incorporate in their State management 
                plan under section 117(g)(1) of the Federal Water 
                Pollution Control Act (33 U.S.C. 1267(g)(1)).
                    ``(B) Technical assistance.--The Secretary shall 
                provide conservation technical assistance--
                            ``(i) to educate agricultural and private 
                        forest landowners in the Chesapeake Bay 
                        watershed regarding State and Federal 
                        regulatory water quality requirements and 
                        possible activities they could undertake to 
                        come into compliance with the regulations; and
                            ``(ii) to assist such landowners in 
                        conservation planning that will achieve and 
                        maintain regulatory compliance.
                    ``(C) Memorandum of understanding.--The Secretary 
                may enter into a memorandum of understanding with the 
                Administrator of the Environmental Protection Agency 
                and with the Chesapeake Bay States to coordinate 
                conservation planning for agricultural and non-
                industrial private forest lands to meet applicable 
                State water quality requirements.
            ``(3) Effect of assurance standards.--Agricultural and 
        private forest landowners who develop and implement a 
        conservation plan in accordance with this subsection shall be 
        deemed to be in full compliance with applicable Federal and 
        State water quality requirements under section 303(d) of the 
        Federal Water Pollution Control Act (33 U.S.C. 1313(d)).
            ``(4) Definitions.--In this subsection:
                    ``(A) Chesapeake bay state.--The term `Chesapeake 
                Bay State' means Delaware, Maryland, New York, 
                Pennsylvania, Virginia, West Virginia, and the District 
                of Columbia.
                    ``(B) Conservation planning.--The term 
                `conservation planning' has the same meaning as 
                established for such term in the Natural Resources 
                Conservation Service field office technical guide, 
                comprehensive nutrient management plans, and nutrient 
                management plans.''.

SEC. 5. TECHNICAL GUIDELINES FOR ENVIRONMENTAL SERVICES MARKETS.

    (a) Types of Guidelines Required.--
            (1) Additional guidelines.--Section 1245(b) of the Food 
        Security Act of 1985 (16 U.S.C. 3845(b)) is amended by striking 
        paragraphs (1), (2), and (3) and inserting the following new 
        paragraphs:
            ``(1) Methodologies for quantifying environmental service 
        benefits.
            ``(2) Baseline methodologies for environmental service 
        benefits.
            ``(3) Methodologies to account for reversals and leakage 
        for environmental services markets.
            ``(4) Methodologies for verification of the environmental 
        service benefits.
            ``(5) A protocol to report environmental service benefits.
            ``(6) A registry to collect, record, and maintain the 
        benefits measured.
            ``(7) A procedure to verify and ensure compliance of the 
        environmental service benefits.''.
            (2) Conforming amendments.--Section 1245(c)(1) of the Food 
        Security Act of 1985 (16 U.S.C. 3845(c)(1)) is amended--
                    (A) by striking ``paragraph (2)'' and inserting 
                ``paragraph (5)''; and
                    (B) by striking ``paragraph (3)'' and inserting 
                ``paragraph (6)''.
    (b) Additional Requirements.--Section 1245 of the Food Security Act 
of 1985 (16 U.S.C. 3845) is amended by adding at the end the following 
new subsections:
    ``(f) List of Eligible Activities.--
            ``(1) List required.--The Secretary shall publish a list of 
        eligible domestic agricultural and forestry activities that 
        result in environmental service benefits.
            ``(2) Deadline; publication.--Not later than 14 months 
        after the date of the enactment of the Chesapeake Bay Program 
        Reauthorization and Improvement Act, the Secretary shall 
        publish in the Federal Register the list of domestic 
        agricultural and forestry activities that are eligible for the 
        guidelines established under subsection (a).
            ``(3) Recommendations.--In preparing the list under this 
        subsection, the Secretary shall take into consideration the 
        recommendations of the entities referred to in subsection (e).
            ``(4) Additions and revisions.--Not later than four years 
        after the date of the enactment of the Chesapeake Bay Program 
        Reauthorization and Improvement Act, and every two years 
        thereafter, the Secretary shall add to and revise the list 
        prepared under this subsection. The additions and revisions 
        shall be made only after the Secretary provides an opportunity 
        for public notice of and an opportunity for comment on the 
        proposed additions and revisions.
    ``(g) Guidelines for Provision of Technical Assistance.--
            ``(1) Verification guidelines.--As part of the regulations 
        promulgated under this title, the Secretary shall establish 
        guidelines for the provision of technical assistance to 
        ensure--
                    ``(A) that environmental service benefits have been 
                implemented properly; and
                    ``(B) the quantification of the benefits have 
                resulted in an environmental benefit.
            ``(2) Technical assistance provider accreditation.--As part 
        of the regulations promulgated under this title, the Secretary 
        shall establish a process and requirements for periodic 
        accreditation of certified technical assistance providers for 
        environmental service benefits to ensure that those technical 
        service providers are professionally qualified and have no 
        conflicts of interest. Each technical service provider meeting 
        the requirements for accreditation in accordance with this 
        paragraph shall be listed in a publicly accessible database, 
        which shall be maintained and updated by the Secretary.''.

SEC. 6. CHESAPEAKE BAY WATERSHED PILOT PROGRAM FOR CREATING 
              ENVIRONMENTAL SERVICE MARKETS.

    Section 1240Q of the Food Security Act of 1985 (16 U.S.C. 3839bb-4) 
is amended by inserting after subsection (i), as added by section 102, 
the following new subsection:
    ``(j) Pilot Program for Creating Environmental Service Markets.--
            ``(1) Establishment.--The Secretary shall establish a pilot 
        program for the Chesapeake Bay watershed for the facilitation 
        of creating environmental service markets based on the 
        guidelines outlined in section 1245 as long as those 
        environmental service benefits do not result in taking eligible 
        land wholly out of agricultural production. The Secretary shall 
        ensure that the pilot program is consistent with the policies, 
        protocols, and regulations established under existing 
        environmental service markets in the Chesapeake Bay watershed.
            ``(2) Transmission of data to chesapeake bay nutrient and 
        sediment trading commission.--The Secretary shall transmit to 
        the Chesapeake Bay Nutrient and Sediment Trading Commission 
        such data acquired by the Secretary as may be necessary to the 
        effective administration of nutrient and sediment trading 
        programs administered by the Commission under section 117A of 
        the Federal Water Pollution Control Act.''.
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