I 

113TH CONGRESS 

2D SESSION H. R. 5363 

To establish a WaterSense program, and for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

JULY 31, 2014 

Mrs. NAPOLITANO (for herself, Ms. ROYBAL-ALLARD, Ms. CHU, Mr. DEFAZIO, Mrs. NEGRETE MCLEOD, Mr. GARAMENDI, Mr. CA ́RDENAS, Mr. 

LOWENTHAL, Ms. ESHOO, Ms. HAHN, Mrs. KIRKPATRICK, and Ms. LEE

of California) introduced the following bill; which was referred to the 

Committee on Natural Resources, and in addition to the Committees on 

Transportation and Infrastructure, Energy and Commerce, and Science, 

Space, and Technology, 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 establish a WaterSense program, 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; TABLE OF CONTENTS. 

4 (a) SHORT TITLE.—This Act may be cited as the 

5 ‘‘Water in the 21st Century Act’’ or ‘‘W21’’. 

6 (b) TABLE OF CONTENTS.—The table of contents of 

7 this Act is as follows: 

Sec. 1. Short title; table of contents. 

Sec. 2. Definition of Administrator. 


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TITLE I—CONSERVATION AND EFFICIENCY 

Sec. 101. Water efficiency, conservation, and adaptation. 

TITLE II—RECYCLING, STORAGE, AND INTEGRATED WATER 

MANAGEMENT 

Sec. 201. Definitions. 

Subtitle A—Innovative Financing 

Sec. 211. Purposes. 

Sec. 212. Authority to provide assistance. 

Sec. 213. Applications. 

Sec. 214. Eligibility for assistance. 

Sec. 215. Determination of eligibility and project selection. 

Sec. 216. Secured loans. 

Sec. 217. Program administration. 

Sec. 218. State and local permits. 

Sec. 219. Regulations. 

Sec. 220. Funding. 

Sec. 221. Report to Congress. 

Subtitle B—Integrated Regional Water Management, Reclamation, and 

Recycling Projects 

Sec. 231. Water storage projects. 

Sec. 232. Authorization of appropriations. 

Subtitle C—Title Transfers 

Sec. 241. Authorization to transfer title. 

TITLE III—INNOVATION THROUGH RESEARCH, DATA, AND 

TECHNOLOGY 

Sec. 301. Open water data system. 

Sec. 302. Water Resources Research Act amendments. 

Sec. 303. Reauthorization of Water Desalination Act of 1996. 

Sec. 304. Review of reservoir operations. 

TITLE IV—DROUGHT PREPAREDNESS AND RESILIENCE 

Sec. 401. National drought resilience guidelines. 

Sec. 402. Drought preparedness for fisheries. 

1 SEC. 2. DEFINITION OF ADMINISTRATOR. 

2 In this Act, the term ‘‘Administrator’’ means the Ad3 ministrator of the Environmental Protection Agency. 


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1 TITLE I—CONSERVATION AND 

2 EFFICIENCY 

3 SEC. 101. WATER EFFICIENCY, CONSERVATION, AND ADAP4 TATION. 

5 (a) WATERSENSE.— 

6 (1) IN GENERAL.—There is established within 

7 the Environmental Protection Agency a WaterSense 

8 program to identify and promote water efficient 

9 products, buildings, landscapes, facilities, processes, 

10 and services so as— 

11 (A) to reduce water use; 

12 (B) to reduce the strain on water, waste13 water, and stormwater infrastructure; 

14 (C) to conserve energy used to pump, heat, 

15 transport, and treat water; and 

16 (D) to preserve water resources for future 

17 generations, through voluntary labeling of, or 

18 other forms of communications about, products, 

19 buildings, landscapes, facilities, processes, and 

20 services that meet the highest water efficiency 

21 and performance criteria. 

22 (2) DUTIES.—The Administrator shall— 

23 (A) establish— 

24 (i) a WaterSense label to be used for 

25 certain items; and 


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1 (ii) the procedure by which an item 

2 may be certified to display the WaterSense 

3 label; 

4 (B) promote WaterSense-labeled products, 

5 buildings, landscapes, facilities, processes, and 

6 services in the marketplace as the preferred 

7 technologies and services for— 

8 (i) reducing water use; and 

9 (ii) ensuring product and service per10 formance; 

11 (C) work to enhance public awareness of 

12 the WaterSense label through public outreach, 

13 education, and other means; 

14 (D) preserve the integrity of the 

15 WaterSense label by— 

16 (i) establishing and maintaining per17 formance criteria so that products, build18 ings, landscapes, facilities, processes, and 

19 services labeled with the WaterSense label 

20 perform as well or better than less water21 efficient counterparts; 

22 (ii) overseeing WaterSense certifi23 cations made by third parties; 

24 (iii) conducting reviews of the use of 

25 the WaterSense label in the marketplace 


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1 and taking corrective action in any case in 

2 which misuse of the label is identified; and 

3 (iv) carrying out such other measures 

4 as the Administrator determines to be ap5 propriate; 

6 (E) regularly review and, if appropriate, 

7 update WaterSense criteria for categories of 

8 products, buildings, landscapes, facilities, proc9 esses, and services, at least once every 6 years; 

10 (F) to the maximum extent practicable, 

11 regularly estimate and make available to the 

12 public the production and relative market 

13 shares of, and the savings of water, energy, and 

14 capital costs of water, wastewater, and 

15 stormwater infrastructure attributable to the 

16 use of WaterSense-labeled products, buildings, 

17 landscapes, facilities, processes, and services, at 

18 least annually; 

19 (G) solicit comments from interested par20 ties and the public prior to establishing or re21 vising a WaterSense category, specification, in22 stallation criterion, or other criterion; 

23 (H) provide reasonable notice to interested 

24 parties and the public of any changes (including 

25 effective dates), on the adoption of a new or reVerDate Mar 15 2010 23:31 Aug 14, 2014 Jkt 039200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\H5363.IH H5363

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1 vised category, specification, installation cri2 terion, or other criterion, along with— 

3 (i) an explanation of the changes; and 

4 (ii) as appropriate, responses to com5 ments submitted by interested parties and 

6 the public; 

7 (I) provide appropriate lead time (as deter8 mined by the Administrator) prior to the appli9 cable effective date for a new or significant revi10 sion to a category, specification, installation cri11 terion, or other criterion, taking into account 

12 the timing requirements of the manufacturing, 

13 marketing, training, and distribution process 

14 for the specific product, building and landscape, 

15 or service category addressed; 

16 (J) identify and, if appropriate, implement 

17 other voluntary approaches in commercial, insti18 tutional, residential, industrial, and municipal 

19 sectors to encourage recycling and reuse tech20 nologies to improve water efficiency or lower 

21 water use; and 

22 (K) if appropriate, authorize the 

23 WaterSense label for use on products that are 

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1 mented by the Administrator and the Secretary 

2 of Energy. 

3 (3) AUTHORIZATION OF APPROPRIATIONS.— 

4 There are authorized to be appropriated to carry out 

5 this section— 

6 (A) $5,000,000 for fiscal year 2015; 

7 (B) $10,000,000 for fiscal year 2016; 

8 (C) $15,000,000 for fiscal year 2017; 

9 (D) $20,000,000 for fiscal year 2018; and 

10 (E) for each subsequent fiscal year, the ap11 plicable amount for the preceding fiscal year, as 

12 adjusted to reflect changes for the 12-month 

13 period ending the preceding November 30 in 

14 the Consumer Price Index for All Urban Con15 sumers published by the Bureau of Labor Sta16 tistics of the Department of Labor. 

17 (b) STATE RESIDENTIAL WATER EFFICIENCY AND

18 CONSERVATION INCENTIVES PROGRAM.— 

19 (1) DEFINITIONS.—In this subsection: 

20 (A) ELIGIBLE ENTITY.—The term ‘‘eligible 

21 entity’’ means a State government, local or 

22 county government, tribal government, waste23 water or sewerage utility, municipal water au24 thority, energy utility, water utility, or nonVerDate Mar 15 2010 23:31 Aug 14, 2014 Jkt 039200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\H5363.IH H5363

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1 profit organization that meets the requirements 

2 of paragraph (2). 

3 (B) INCENTIVE PROGRAM.—The term ‘‘in4 centive program’’ means a program for admin5 istering financial incentives for consumer pur6 chase and installation of water-efficient prod7 ucts, buildings (including new water-efficient 

8 homes), landscapes, processes, or services de9 scribed in paragraph (2)(A). 

10 (C) RESIDENTIAL WATER-EFFICIENT

11 PRODUCT, BUILDING, LANDSCAPE, PROCESS, OR

12 SERVICE.— 

13 (i) IN GENERAL.—The term ‘‘residen14 tial water-efficient product, building, land15 scape, process, or service’’ means a prod16 uct, building, landscape, process, or service 

17 for a residence or its landscape that is 

18 rated for water efficiency and perform19 ance— 

20 (I) by the WaterSense program; 

21 or 

22 (II) if a WaterSense specification 

23 does not exist, by the Energy Star 

24 program or an incentive program ap25 proved by the Administrator. 


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1 (ii) INCLUSIONS.—The term ‘‘residen2 tial water-efficient product, building, land3 scape, process, or service’’ includes— 

4 (I) faucets; 

5 (II) irrigation technologies and 

6 services; 

7 (III) point-of-use water treat8 ment devices; 

9 (IV) reuse and recycling tech10 nologies; 

11 (V) toilets; 

12 (VI) clothes washers; 

13 (VII) dishwashers; 

14 (VIII) showerheads; 

15 (IX) xeriscaping and other land16 scape conversions that replace irri17 gated turf; 

18 (X) new water efficient homes 

19 certified under the WaterSense pro20 gram; 

21 (XI) green stormwater installa22 tions such as permeable pavement, 

23 rain gardens, rain barrels, and green 

24 roofs; 


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1 (XII) composting solutions com2 plementary to water use and water 

3 quality; and 

4 (XIII) other water-efficient prod5 ucts, services, processes, or behavioral 

6 water efficiency solutions that address 

7 the objectives of the WaterSense pro8 gram. 

9 (D) WATERSENSE PROGRAM.—The term 

10 ‘‘WaterSense program’’ means the program es11 tablished by subsection (a). 

12 (2) ELIGIBLE ENTITIES.—An entity shall be eli13 gible to receive an allocation under paragraph (3) if 

14 the entity— 

15 (A) establishes (or has established) an in16 centive program to provide financial incentives 

17 to residential consumers for the purchase of 

18 residential water-efficient products, buildings, 

19 landscapes, processes, or services; 

20 (B) submits an application for the alloca21 tion at such time, in such form, and containing 

22 such information as the Administrator may re23 quire; and 

24 (C) provides assurances satisfactory to the 

25 Administrator that the entity will use the alloVerDate Mar 15 2010 23:31 Aug 14, 2014 Jkt 039200 PO 00000 Frm 00010 Fmt 6652 Sfmt 6201 E:\BILLS\H5363.IH H5363

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1 cation to supplement, but not supplant, non2 Federal funds made available to carry out the 

3 incentive program. 

4 (3) AMOUNT OF ALLOCATIONS.—For each fiscal 

5 year, the Administrator shall determine the amount 

6 to allocate to each eligible entity to carry out para7 graph (4), taking into consideration— 

8 (A) the population served by the eligible 

9 entity during the most recent calendar year for 

10 which data are available; 

11 (B) the targeted population of the incen12 tive program of the eligible entity, such as gen13 eral households, low-income households, or first14 time homeowners, and the probable effective15 ness of the incentive program for that popu16 lation; 

17 (C) for existing programs, the effectiveness 

18 of the program in encouraging the adoption of 

19 water-efficient products, buildings, landscapes, 

20 facilities, processes, and services; 

21 (D) any allocation to the eligible entity for 

22 a preceding fiscal year that remains unused; 

23 and 

24 (E) the per capita water demand of the 

25 population served by the eligible entity during 


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1 the most recent calendar year for which data 

2 are available and the availability or reliability of 

3 water supplies to the eligible entity. 

4 (4) USE OF ALLOCATED FUNDS.—Funds allo5 cated to an eligible entity under paragraph (3) may 

6 be used to pay up to 50 percent of the cost of estab7 lishing and carrying out an incentive program. 

8 (5) ISSUANCE OF INCENTIVES.— 

9 (A) IN GENERAL.—Financial incentives 

10 may be provided to residential consumers that 

11 meet the requirements of the applicable incen12 tive program. 

13 (B) MANNER OF ISSUANCE.—An eligible 

14 entity may— 

15 (i) issue all financial incentives di16 rectly to residential consumers; or 

17 (ii) with approval of the Adminis18 trator, delegate all or part of financial in19 centive administration to other organiza20 tions, including local governments, munic21 ipal water authorities, water utilities, and 

22 nonprofit organizations. 

23 (C) AMOUNT.—The amount of a financial 

24 incentive shall be determined by the eligible en25 tity, taking into consideration— 


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1 (i) the amount of any Federal or 

2 State tax incentive available for the pur3 chase of the residential water-efficient 

4 product or service; 

5 (ii) the amount necessary to change 

6 consumer behavior to purchase water-effi7 cient products and services; and 

8 (iii) the consumer expenditures for on9 site preparation, assembly, and original in10 stallation of the product. 

11 (6) AUTHORIZATION OF APPROPRIATIONS.— 

12 There are authorized to be appropriated to the Ad13 ministrator to carry out this subsection— 

14 (A) $100,000,000 for fiscal year 2015; 

15 (B) $150,000,000 for fiscal year 2016; 

16 (C) $200,000,000 for fiscal year 2017; 

17 (D) $150,000,000 for fiscal year 2018; 

18 (E) $100,000,000 for fiscal year 2019; and 

19 (F) for each subsequent fiscal year, the ap20 plicable amount for the preceding fiscal year, as 

21 adjusted to reflect changes for the 12-month 

22 period ending the preceding November 30 in 

23 the Consumer Price Index for All Urban Con24 sumers published by the Bureau of Labor Sta25 tistics of the Department of Labor. 


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1 (c) WATER SYSTEM MITIGATION AND ADAPTATION

2 GRANTS.— 

3 (1) DEFINITIONS.—In this subsection: 

4 (A) OWNER OR OPERATOR.— 

5 (i) IN GENERAL.—The term ‘‘owner 

6 or operator’’ means a person (including a 

7 regional, State, local, municipal, or private 

8 entity) that owns or operates a water sys9 tem. 

10 (ii) INCLUSION.—The term ‘‘owner or 

11 operator’’ includes a non-Federal entity 

12 that has operational responsibilities for a 

13 federally owned water system. 

14 (B) WATER SYSTEM.—The term ‘‘water 

15 system’’ means— 

16 (i) a community water system (as de17 fined in section 1401 of the Safe Drinking 

18 Water Act (42 U.S.C. 300f)); 

19 (ii) a publicly owned treatment works 

20 (as defined in section 212 of the Federal 

21 Water Pollution Control Act (33 U.S.C. 

22 1292)), including a municipal separate 

23 storm sewer system; 

24 (iii) a decentralized wastewater treat25 ment system for domestic sewage; 


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1 (iv) a groundwater storage and re2 plenishment system; or 

3 (v) a system for transport and deliv4 ery of water for irrigation or conservation. 

5 (2) GRANTS.—Beginning in fiscal year 2015, 

6 the Administrator shall make grants to owners or 

7 operators of water systems to address any ongoing 

8 or forecasted (based on the best available research 

9 and data) climate-related impact on the water qual10 ity or quantity of a region of the United States, for 

11 the purposes of mitigating or adapting to the im12 pacts of climate change. 

13 (3) ELIGIBLE USES.—In carrying out this sub14 section, the Administrator shall make grants to as15 sist in the planning, design, construction, implemen16 tation, or maintenance of any program or project to 

17 increase the resilience of a water system to climate 

18 change by— 

19 (A) conserving water or enhancing water 

20 use efficiency, including through the use of 

21 water metering to measure the effectiveness of 

22 a water efficiency program; 

23 (B) modifying or relocating existing water 

24 system infrastructure made or projected to be 

25 made inoperable by climate change impacts; 


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1 (C) preserving or improving water quality, 

2 including through measures to manage, reduce, 

3 treat, or reuse municipal stormwater, waste4 water, or drinking water; 

5 (D) investigating, designing, or con6 structing groundwater remediation, recycled 

7 water, or desalination facilities or systems; 

8 (E) enhancing water management by in9 creasing watershed preservation and protection, 

10 such as through the use of natural or engi11 neered green infrastructure in the management, 

12 conveyance, or treatment of water, wastewater, 

13 or stormwater; 

14 (F) enhancing energy efficiency or the use 

15 and generation of renewable energy in the man16 agement, conveyance, or treatment of water, 

17 wastewater, or stormwater; 

18 (G) supporting the adoption and use of ad19 vanced water treatment, water supply manage20 ment (such as reservoir reoperation), or water 

21 demand management technologies, projects, or 

22 processes (such as water reuse and recycling or 

23 adaptive conservation pricing) that maintain or 

24 increase water supply or improve water quality; 


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1 (H) modifying or replacing existing sys2 tems or constructing new systems for existing 

3 communities or land currently in agricultural 

4 production to improve water availability, stor5 age, or conveyance in a manner that— 

6 (i) promotes more efficient use of 

7 available water supplies; and 

8 (ii) does not further exacerbate 

9 stresses on ecosystems; 

10 (I) supporting practices and projects, such 

11 as improved irrigation systems, water banking 

12 and other forms of water transactions, ground13 water recharge, stormwater capture, and reuse 

14 or recycling of drainage water, to improve water 

15 quality or promote more efficient water use, in16 cluding on land currently in agricultural pro17 duction; 

18 (J) conducting and completing studies or 

19 assessments to project how climate change may 

20 impact the future operations and sustainability 

21 of water systems; 

22 (K) developing and implementing mitiga23 tion measures to rapidly address impacts on 

24 water systems most susceptible to abrupt cli25 mate change, including those in the Colorado 


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1 River Basin and coastal regions at risk from 

2 rising sea levels; or 

3 (L) funding of transactions costs and cred4 it enhancement for pay-for-performance-based 

5 public-private initiatives intended to advance 

6 the eligible uses of the program or project. 

7 (4) APPLICATION.—To be eligible to receive a 

8 grant from the Administrator under paragraph (2), 

9 the owner or operator of a water system shall submit 

10 to the Administrator an application that— 

11 (A) includes a proposal of the program, 

12 strategy, or infrastructure improvement to be 

13 planned, designed, constructed, implemented, or 

14 maintained by the water system; 

15 (B) cites the best available research or 

16 data that demonstrates— 

17 (i) the risk to the water resources or 

18 infrastructure of the water system as a re19 sult of ongoing or forecasted changes to 

20 the hydrological system brought about by 

21 factors arising from climate change, in22 cluding rising sea levels and changes in 

23 precipitation levels; and 

24 (ii) how the proposed program, strat25 egy, or infrastructure improvement would 


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1 perform under the anticipated climate con2 ditions; 

3 (C) explains how the proposed program, 

4 strategy, or infrastructure improvement is ex5 pected to enhance the resiliency of the water 

6 system, including source water protection for 

7 community water systems, to these risks or re8 duce the direct or indirect greenhouse gas emis9 sions of the water system; and 

10 (D) demonstrates that the program, strat11 egy, or infrastructure improvement is— 

12 (i) consistent with any approved State 

13 and tribal climate adaptation plan; and 

14 (ii) not inconsistent with any ap15 proved natural resources plan. 

16 (5) COMPETITIVE PROCESS.— 

17 (A) IN GENERAL.—Each calendar year, the 

18 Administrator shall conduct a competitive proc19 ess to select and fund applications under this 

20 subsection. 

21 (B) PRIORITY REQUIREMENTS AND

22 WEIGHTING.—In carrying out the process, the 

23 Administrator shall— 

24 (i) prioritize funding of applications 

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1 tors of water systems that are, based on 

2 the best available research and data, at the 

3 greatest and most immediate risk of facing 

4 significant climate-related negative impacts 

5 on water quality or quantity; 

6 (ii) in selecting among the priority ap7 plications determined under clause (i), en8 sure that the final list of applications fund9 ed for each year includes a substantial 

10 number that, to the maximum extent prac11 ticable, includes each eligible use described 

12 in paragraph (3); 

13 (iii) solicit applications from water 

14 systems that are— 

15 (I) located in all regions of the 

16 United States; and 

17 (II) facing varying risks as a re18 sult of climate change; and 

19 (iv) provide for solicitation and con20 sideration of public input in the develop21 ment of criteria used in evaluating applica22 tions. 

23 (6) COST SHARING.— 

24 (A) FEDERAL SHARE.—The Federal share 

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1 structure improvement that is the subject of a 

2 grant awarded by the Administrator to a water 

3 system under paragraph (2) shall not exceed 50 

4 percent of the cost of the program, strategy, 

5 and infrastructure improvement. 

6 (B) CALCULATION OF NON-FEDERAL

7 SHARE.—In calculating the non-Federal share 

8 of the cost of a program, strategy, or infra9 structure improvement proposed by a water sys10 tem through an application submitted by the 

11 water system under paragraph (4), the Admin12 istrator shall— 

13 (i) include the value of any in-kind 

14 services that are integral to the completion 

15 of the program, strategy, or infrastructure 

16 improvement, as determined by the Admin17 istrator; and 

18 (ii) not include any other amount that 

19 the water system receives from a Federal 

20 agency. 

21 (7) LABOR STANDARDS.— 

22 (A) IN GENERAL.—All laborers and me23 chanics employed on infrastructure improve24 ments funded directly by or assisted in whole or 

25 in part by this subsection shall be paid wages 


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1 at rates not less than those prevailing for the 

2 same type of work on similar construction in 

3 the immediate locality, as determined by the 

4 Secretary of Labor in accordance with sub5 chapter IV of chapter 31 of part A of subtitle 

6 II of title 40, United States Code. 

7 (B) AUTHORITY AND FUNCTIONS.—With 

8 respect to the labor standards in this para9 graph, the Secretary of Labor shall have the 

10 authority and functions set forth in Reorganiza11 tion Plan Numbered 14 of 1950 (64 Stat. 

12 1267; 5 U.S.C. App.) and section 3145 of title 

13 40, United States Code. 

14 (8) LOCAL HIRING.— 

15 (A) IN GENERAL.—The recipient of assist16 ance may advertise and award a contract for 

17 construction containing requirements for the 

18 employment of individuals residing in or adja19 cent to any of the areas in which the work is 

20 to be performed under the contract, if— 

21 (i) all or part of the construction work 

22 performed under the contract occurs in an 

23 area that has— 


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1 (I) a per capita income of 80 per2 cent or less of the national average 

3 per capita income; or 

4 (II) an unemployment rate that 

5 is, for the most recent 24-month pe6 riod for which data are available, at 

7 least 1 percent greater than the na8 tional average unemployment rate; 

9 (ii) the estimated cost of the project 

10 of which the contract is a part is greater 

11 than $1,000,000; and 

12 (iii) the recipient does not hire indi13 viduals who do not have the necessary 

14 skills to perform work in the applicable 

15 craft or trade, except for individuals who 

16 are subject to an apprenticeship program 

17 or other training program meeting, as de18 termined by the Secretary. 

19 (B) ADVERTISEMENT.—In advertising and 

20 awarding a contract under this subsection, the 

21 Secretary or recipient of assistance shall ensure 

22 that the requirements contained in the adver23 tisement would not— 

24 (i) compromise the quality of the 

25 project; 


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1 (ii) unreasonably delay the completion 

2 of the project; or 

3 (iii) unreasonably increase the cost of 

4 the project. 

5 (9) EFFICIENT, INTEGRATED PROCUREMENT

6 FOR PROGRAMS JOINTLY FUNDED WITH THE DE7 PARTMENT OF HOUSING AND URBAN DEVELOP8 MENT.— 

9 (A) DEFINITION OF ELIGIBLE PROJECT.— 

10 In this paragraph, the term ‘‘eligible project’’ 

11 means a project for which the amount of fund12 ing provided by the Department of Housing and 

13 Urban Development is 10 percent or more of 

14 the amount of funding provided under this sub15 section. 

16 (B) PREFERENCES.—Notwithstanding the 

17 competitive bidding requirements of this section 

18 (including regulations), in the case of an eligible 

19 project funded jointly with funding provided by 

20 the Department of Housing and Urban Devel21 opment that is covered by section 3 of the 

22 Housing and Urban Development Act of 1968 

23 (82 Stat. 846; 12 U.S.C. 1701u), a contracting 

24 agency may apply the preferences required for 

25 the funding by the Department of Housing and 


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1 Urban Development under section 3 of that Act 

2 (including regulations) with respect to the fund3 ing, to the elements of the project funded in 

4 any part under this subsection. 

5 (C) PERMISSIBLE RESTRICTIONS.—A State 

6 or local law governing contracting practices that 

7 prohibits the awarding of contracts to busi8 nesses that have solicited or made contributions 

9 to political candidates, political parties, and 

10 holders of public office shall not be considered 

11 a violation of this section. 

12 (10) REGULATIONS.— 

13 (A) IN GENERAL.—Not later than 1 year 

14 after the date of enactment of this Act, the Ad15 ministrator shall promulgate final regulations to 

16 carry out this subsection. 

17 (B) SPECIAL RULE FOR THE CONSTRUC18 TION OF TREATMENT WORKS.—In carrying out 

19 this paragraph, the Administrator shall incor20 porate all relevant and appropriate require21 ments of title VI of the Federal Water Pollution 

22 Control Act (33 U.S.C. 1381 et seq.) applicable 

23 to the construction of treatment works that are 

24 carried out under this subsection. 


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1 (11) REPORT TO CONGRESS.—Not later than 3 

2 years after the date of enactment of this Act, and 

3 every 3 years thereafter, the Administrator shall 

4 submit to Congress a report on progress in imple5 menting this subsection, including information on 

6 project applications received and funded annually. 

7 (12) AUTHORIZATION OF APPROPRIATIONS.— 

8 There are authorized to be appropriated to carry out 

9 this subsection such sums as are necessary. 

10 TITLE II—RECYCLING, STORAGE, 

11 AND INTEGRATED WATER 

12 MANAGEMENT 

13 SEC. 201. DEFINITIONS. 

14 In this title: 

15 (1) ELIGIBLE ENTITY.—The term ‘‘eligible enti16 ty’’ means— 

17 (A) a corporation; 

18 (B) a partnership; 

19 (C) a joint venture; 

20 (D) a trust; 

21 (E) a Federal, State, or local governmental 

22 entity, agency, or instrumentality; and 

23 (F) a conservancy district, irrigation dis24 trict, canal company, mutual water company, 

25 water users’ association, Indian tribe, agency 


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1 created by interstate compact, or any other en2 tity that has the capacity to contract with the 

3 United States under Federal reclamation law. 

4 (2) FEDERAL CREDIT INSTRUMENT.—The term 

5 ‘‘Federal credit instrument’’ means a secured loan, 

6 loan guarantee, or other credit enhancement author7 ized to be made available under this title with re8 spect to a project. 

9 (3) INVESTMENT-GRADE RATING.—The term 

10 ‘‘investment-grade rating’’ means a rating of BBB 

11 minus, Baa3, bbb minus, BBB (low), or higher as 

12 assigned by a rating agency to project obligations. 

13 (4) LENDER.— 

14 (A) IN GENERAL.—The term ‘‘lender’’ 

15 means any non-Federal qualified institutional 

16 buyer (as defined in section 230.144A(a) of 

17 title 17, Code of Federal Regulations (or a suc18 cessor regulation) (commonly known as ‘‘Rule 

19 144A(a) of the Securities and Exchange Com20 mission’’ and issued under the Securities Act of 

21 1933 (15 U.S.C. 77a et seq.))). 

22 (B) INCLUSIONS.—The term ‘‘lender’’ in23 cludes— 

24 (i) a qualified retirement plan (as de25 fined in section 4974 of the Internal RevVerDate Mar 15 2010 23:31 Aug 14, 2014 Jkt 039200 PO 00000 Frm 00027 Fmt 6652 Sfmt 6201 E:\BILLS\H5363.IH H5363

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1 enue Code of 1986) that is a qualified in2 stitutional buyer; and 

3 (ii) a governmental plan (as defined in 

4 section 414 of the Internal Revenue Code 

5 of 1986) that is a qualified institutional 

6 buyer. 

7 (5) LOAN GUARANTEE.—The term ‘‘loan guar8 antee’’ means any guarantee or other pledge by the 

9 Secretary to pay all or part of the principal of, and 

10 interest on, a loan or other debt obligation issued by 

11 an obligor and funded by a lender. 

12 (6) OBLIGOR.—The term ‘‘obligor’’ means an 

13 eligible entity that is primarily liable for payment of 

14 the principal of, or interest on, a Federal credit in15 strument. 

16 (7) PROJECT OBLIGATION.— 

17 (A) IN GENERAL.—The term ‘‘project obli18 gation’’ means any note, bond, debenture, or 

19 other debt obligation issued by an obligor in 

20 connection with the financing of a project. 

21 (B) EXCLUSION.—The term ‘‘project obli22 gation’’ does not include a Federal credit in23 strument. 

24 (8) RATING AGENCY.—The term ‘‘rating agen25 cy’’ means a credit rating agency registered with the 


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1 Securities and Exchange Commission as a nationally 

2 recognized statistical rating organization (as defined 

3 in section 3(a) of the Securities Exchange Act of 

4 1934 (15 U.S.C. 78c(a))). 

5 (9) RECLAMATION STATE.—The term ‘‘Rec6 lamation State’’ means any of the States of— 

7 (A) Arizona; 

8 (B) California; 

9 (C) Colorado; 

10 (D) Idaho; 

11 (E) Kansas; 

12 (F) Montana; 

13 (G) Nebraska; 

14 (H) Nevada; 

15 (I) New Mexico; 

16 (J) North Dakota; 

17 (K) Oklahoma; 

18 (L) Oregon; 

19 (M) South Dakota; 

20 (N) Texas; 

21 (O) Utah; 

22 (P) Washington; and 

23 (Q) Wyoming. 

24 (10) SECRETARY.—The term ‘‘Secretary’’ 

25 means the Secretary of the Interior. 


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1 (11) SECURED LOAN.—The term ‘‘secured 

2 loan’’ means a direct loan or other debt obligation 

3 issued by an obligor and funded by the Secretary in 

4 connection with the financing of a project under sub5 title A. 

6 (12) SUBSIDY AMOUNT.—The term ‘‘subsidy 

7 amount’’ means the amount of budget authority suf8 ficient to cover the estimated long-term cost to the 

9 Federal Government of a Federal credit instrument, 

10 as calculated on a net present value basis, excluding 

11 administrative costs and any incidental effects on 

12 Governmental receipts or outlays in accordance with 

13 the Federal Credit Reform Act of 1990 (2 U.S.C. 

14 661 et seq.). 

15 (13) SUBSTANTIAL COMPLETION.—The term 

16 ‘‘substantial completion’’, with respect to a project, 

17 means the earliest date on which a project is consid18 ered to perform the functions for which the project 

19 is designed. 

20 Subtitle A—Innovative Financing 

21 SEC. 211. PURPOSES. 

22 The purposes of this subtitle are— 

23 (1) to promote increased development of critical 

24 water resources infrastructure by establishing addiVerDate Mar 15 2010 23:31 Aug 14, 2014 Jkt 039200 PO 00000 Frm 00030 Fmt 6652 Sfmt 6201 E:\BILLS\H5363.IH H5363

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1 tional opportunities for financing water resources 

2 projects; 

3 (2) to attract new investment capital to infra4 structure projects that are capable of generating rev5 enue streams through user fees or other dedicated 

6 funding sources; 

7 (3) to complement existing Federal funding 

8 sources and address budgetary constraints on Bu9 reau of Reclamation programs; and 

10 (4) to leverage private investment in water re11 sources infrastructure. 

12 SEC. 212. AUTHORITY TO PROVIDE ASSISTANCE. 

13 (a) IN GENERAL.—The Secretary may provide finan14 cial assistance under this subtitle to carry out projects 

15 within— 

16 (1) any Reclamation State; 

17 (2) any other State in which the Bureau of 

18 Reclamation is authorized to provide project assist19 ance; and 

20 (3) the States of Alaska and Hawaii. 

21 (b) SELECTION.—In selecting projects to receive fi22 nancial assistance under subsection (a), the Secretary 

23 shall ensure diversity with respect to— 

24 (1) project types; and 

25 (2) geographical locations. 


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1 SEC. 213. APPLICATIONS. 

2 To be eligible to receive assistance under this subtitle, 

3 an eligible entity shall submit to the Secretary an applica4 tion at such time, in such manner, and containing such 

5 information as the Secretary may require. 

6 SEC. 214. ELIGIBILITY FOR ASSISTANCE. 

7 (a) ELIGIBLE PROJECTS.—The following projects 

8 may be carried out using assistance made available under 

9 this subtitle: 

10 (1) A project for the reclamation and reuse of 

11 municipal, industrial, domestic, and agricultural 

12 wastewater, and naturally impaired ground and sur13 face waters, which the Secretary, acting through the 

14 Commissioner of Reclamation, is authorized to un15 dertake. 

16 (2) Any water infrastructure project not specifi17 cally authorized by law that— 

18 (A) the Secretary determines, through the 

19 completion of an appraisal investigation and 

20 feasibility study, would contribute to a safe, 

21 adequate water supply for domestic, agricul22 tural, environmental, or municipal and indus23 trial use; and 

24 (B) is otherwise eligible for assistance 

25 under this title. 


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1 (3) A project for enhanced energy efficiency in 

2 the operation of a water system. 

3 (4) A project for accelerated repair and replace4 ment of an aging water distribution facility. 

5 (5) A brackish or sea water desalination 

6 project. 

7 (6) Acquisition of real property or an interest 

8 in real property for water storage, reclaimed or recy9 cled water, or wastewater, if the acquisition is inte10 gral to a project described in paragraphs (1) 

11 through (5). 

12 (7) A combination of projects, each of which is 

13 eligible under paragraphs (1) through (6), for which 

14 an eligible entity submits a single application. 

15 (b) ACTIVITIES ELIGIBLE FOR ASSISTANCE.—For 

16 purposes of this subtitle, an eligible activity with respect 

17 to an eligible project under subsection (a) includes the cost 

18 of— 

19 (1) development-phase activities, including plan20 ning, feasibility analysis, revenue forecasting, envi21 ronmental review, permitting, transaction costs, pre22 liminary engineering and design work, and other 

23 preconstruction activities; 

24 (2) construction, reconstruction, rehabilitation, 

25 and replacement activities; 


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1 (3) the acquisition of real property (including 

2 water rights, land relating to the project, and im3 provements to land), environmental mitigation, con4 struction contingencies, and acquisition of equip5 ment; 

6 (4) capitalized interest necessary to meet mar7 ket requirements, reasonably required reserve funds, 

8 capital issuance expenses, and other carrying costs 

9 during construction; 

10 (5) refinancing interim construction funding, 

11 long-term project obligations, or a secured loan, loan 

12 guarantee, or other credit enhancement made under 

13 this subtitle; 

14 (6) reimbursement or success payments to any 

15 public or private entity that achieves predetermined 

16 outcomes on a pay-for-performance or pay-for-suc17 cess basis; and 

18 (7) grants, loans, or credit enhancement for 

19 community development financial institutions, green 

20 banks, and other financial intermediaries providing 

21 ongoing finance for projects that meet the purposes 

22 of this subtitle. 


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1 SEC. 215. DETERMINATION OF ELIGIBILITY AND PROJECT 

2 SELECTION. 

3 (a) ELIGIBILITY REQUIREMENTS.—To be eligible to 

4 receive financial assistance under this subtitle, a project 

5 shall meet the following criteria, as determined by the Sec6 retary: 

7 (1) CREDITWORTHINESS.— 

8 (A) IN GENERAL.—Subject to subpara9 graph (B), the project shall be creditworthy, as 

10 determined by the Secretary, who shall ensure 

11 that any financing for the project has appro12 priate security features, such as a rate cov13 enant, to ensure repayment. 

14 (B) PRELIMINARY RATING OPINION LET15 TER.—The Secretary shall require each appli16 cant to provide a preliminary rating opinion let17 ter from at least 1 rating agency indicating that 

18 the senior obligations of the project (which may 

19 be the Federal credit instrument) have the po20 tential to achieve an investment-grade rating. 

21 (2) ELIGIBLE PROJECT COSTS.—The eligible 

22 project costs of a project and other projects in a wa23 tershed shall be reasonably anticipated to be not less 

24 than $10,000,000. 

25 (3) DEDICATED REVENUE SOURCES.—The Fed26 eral credit instrument for the project shall be repayVerDate Mar 15 2010 23:31 Aug 14, 2014 Jkt 039200 PO 00000 Frm 00035 Fmt 6652 Sfmt 6201 E:\BILLS\H5363.IH H5363

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1 able, in whole or in part, from dedicated revenue 

2 sources that also secure the project obligations. 

3 (4) PUBLIC SPONSORSHIP OF PRIVATE ENTI4 TIES.—In the case of a project carried out by an en5 tity that is not a State or local government or an 

6 agency or instrumentality of a State or local govern7 ment, the project shall be publicly sponsored. 

8 (b) SELECTION CRITERIA.— 

9 (1) ESTABLISHMENT.—The Secretary shall es10 tablish criteria for the selection of projects that meet 

11 the eligibility requirements of subsection (a), in ac12 cordance with paragraph (2). 

13 (2) CRITERIA.—The selection criteria shall in14 clude the following: 

15 (A) The extent to which the project is na16 tionally or regionally significant. 

17 (B) The extent to which assistance under 

18 this section would foster innovative public-pri19 vate partnerships and attract private debt or 

20 equity investment. 

21 (C) The likelihood that assistance under 

22 this section would enable the project to proceed 

23 at an earlier date than the project would other24 wise be able to proceed. 


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1 (D) The extent to which the project uses 

2 new or innovative approaches. 

3 (E) The extent to which projects track evi4 dence about the effectiveness of the 1 or more 

5 projects financed and the availability of the evi6 dence and project information to the public to 

7 facilitate replication. 

8 (F) The amount of budget authority re9 quired to fund the Federal credit instrument 

10 made available under this subtitle. 

11 (G) The extent to which the project helps 

12 maintain or protect the environment. 

13 (H) The extent to which the project sup14 ports the local economy and provides local jobs. 

15 (c) RECEIPT OF OTHER FEDERAL FUNDING.—Re16 ceipt of a Federal grant or contract or other Federal fund17 ing to support an eligible project shall not preclude the 

18 project from being eligible for assistance under this sub19 title. 

20 (d) FEDERAL REQUIREMENTS.— 

21 (1) EFFECT OF SECTION.—Nothing in this sec22 tion supersedes the applicability of other require23 ments of Federal law (including regulations). 

24 (2) NEPA.—A Federal action carried out re25 garding a loan or loan guarantee provided under this 


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1 subtitle shall not be considered to be a Federal ac2 tion for purposes of the National Environmental 

3 Policy Act of 1969 (42 U.S.C. 4321 et seq.). 

4 SEC. 216. SECURED LOANS. 

5 (a) AGREEMENTS.— 

6 (1) IN GENERAL.—Subject to paragraphs (2) 

7 through (4), the Secretary may enter into agree8 ments with 1 or more obligors to make secured 

9 loans, the proceeds of which shall be used— 

10 (A) to finance eligible project costs of any 

11 project selected under section 206; 

12 (B) to refinance interim construction fi13 nancing of eligible project costs of any project 

14 selected under section 206; or 

15 (C) to refinance long-term project obliga16 tions or Federal credit instruments, if that refi17 nancing provides additional funding capacity for 

18 the completion, enhancement, or expansion of 

19 any project that— 

20 (i) is selected under section 206; or 

21 (ii) otherwise meets the requirements 

22 of section 206. 

23 (2) LIMITATION ON REFINANCING OF INTERIM

24 CONSTRUCTION FINANCING.—A secured loan under 

25 paragraph (1) shall not be used to refinance interim 


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1 construction financing under paragraph (1)(B) later 

2 than 1 year after the date of substantial completion 

3 of the applicable project. 

4 (3) RISK ASSESSMENT.—Before entering into 

5 an agreement under this subsection for a secured 

6 loan, the Secretary, in consultation with the Director 

7 of the Office of Management and Budget and each 

8 rating agency providing a preliminary rating opinion 

9 letter under section 206(a)(1)(B), shall determine an 

10 appropriate capital reserve subsidy amount for the 

11 secured loan, taking into account each such prelimi12 nary rating opinion letter. 

13 (4) INVESTMENT-GRADE RATING REQUIRE14 MENT.—The execution of a secured loan under this 

15 section shall be contingent on receipt by the senior 

16 obligations of the project of an investment-grade rat17 ing. 

18 (b) TERMS AND LIMITATIONS.— 

19 (1) IN GENERAL.—A secured loan provided for 

20 a project under this section shall be subject to such 

21 terms and conditions, and contain such covenants, 

22 representations, warranties, and requirements (in23 cluding requirements for audits), as the Secretary 

24 determines to be appropriate. 


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1 (2) MAXIMUM AMOUNT.—The amount of a se2 cured loan under this section shall not exceed the 

3 lesser of— 

4 (A) an amount equal to 100 percent of the 

5 reasonably anticipated eligible project costs; and 

6 (B) if the secured loan does not receive an 

7 investment-grade rating, the amount of the sen8 ior project obligations of the project. 

9 (3) PAYMENT.—A secured loan under this sec10 tion— 

11 (A) shall be payable, in whole or in part, 

12 from State or local taxes, user fees, or other 

13 dedicated revenue sources that also secure the 

14 senior project obligations of the relevant 

15 project; 

16 (B) shall include a rate covenant, coverage 

17 requirement, or similar security feature sup18 porting the project obligations; and 

19 (C) may have a lien on revenues described 

20 in subparagraph (A), subject to any lien secur21 ing project obligations. 

22 (4) INTEREST RATE.—The interest rate on a 

23 secured loan under this section shall be not more 

24 than the yield on United States Treasury securities 

25 of a similar maturity to the maturity of the secured 


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1 loan on the date of execution of the loan agreement, 

2 as determined by the Secretary. 

3 (5) MATURITY DATE.—The final maturity date 

4 of a secured loan under this section shall be not 

5 later than 35 years after the date of substantial 

6 completion of the relevant project. 

7 (6) NONSUBORDINATION.—A secured loan 

8 under this section shall not be subordinated to the 

9 claims of any holder of project obligations in the 

10 event of bankruptcy, insolvency, or liquidation of the 

11 obligor of the project. 

12 (7) FEES.—The Secretary may establish fees at 

13 a level sufficient to cover all or a portion of the costs 

14 to the Federal Government of making a secured loan 

15 under this section. 

16 (8) NON-FEDERAL SHARE.—The proceeds of a 

17 secured loan under this section may be used to pay 

18 any non-Federal share of project costs required if 

19 the loan is repayable from non-Federal funds. 

20 (c) REPAYMENT.— 

21 (1) SCHEDULE.—The Secretary shall establish 

22 a repayment schedule for each secured loan provided 

23 under this section, based on the projected cash flow 

24 from project revenues and other repayment sources. 


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1 (2) COMMENCEMENT.—Scheduled loan repay2 ment of principal or interest on a secured loan under 

3 this section shall commence not later than 5 years 

4 after the date of substantial completion of the 

5 project. 

6 (3) DEFERRED PAYMENTS.— 

7 (A) AUTHORIZATION.—If, at any time 

8 after the date of substantial completion of a 

9 project for which a secured loan is provided 

10 under this section, the project is unable to gen11 erate sufficient revenues to pay the scheduled 

12 loan repayments of principal and interest on the 

13 secured loan, the Secretary may allow the obli14 gor, subject to subparagraph (C), to add unpaid 

15 principal and interest to the outstanding bal16 ance of the secured loan. 

17 (B) INTEREST.—Any payment deferred 

18 under subparagraph (A) shall— 

19 (i) continue to accrue interest in ac20 cordance with subsection (b)(4) until fully 

21 repaid; and 

22 (ii) be scheduled to be amortized over 

23 the remaining term of the secured loan. 

24 (C) CRITERIA.— 


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1 (i) IN GENERAL.—Any payment defer2 ral under subparagraph (A) shall be con3 tingent on the project meeting such cri4 teria as the Secretary may establish. 

5 (ii) REPAYMENT STANDARDS.—The 

6 criteria established under clause (i) shall 

7 include standards for reasonable assurance 

8 of repayment. 

9 (4) PREPAYMENT.— 

10 (A) USE OF EXCESS REVENUES.—Any ex11 cess revenues that remain after satisfying 

12 scheduled debt service requirements on the 

13 project obligations and secured loan and all de14 posit requirements under the terms of any trust 

15 agreement, bond resolution, or similar agree16 ment securing project obligations may be ap17 plied annually to prepay a secured loan under 

18 this section without penalty. 

19 (B) USE OF PROCEEDS OF REFI20 NANCING.—A secured loan under this section 

21 may be prepaid at any time without penalty 

22 from the proceeds of refinancing from non-Fed23 eral funding sources. 

24 (d) SALE OF SECURED LOANS.— 


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1 (1) IN GENERAL.—Subject to paragraph (2), as 

2 soon as practicable after the date of substantial 

3 completion of a project and after providing a notice 

4 to the obligor, the Secretary may sell to another en5 tity or reoffer into the capital markets a secured 

6 loan for a project under this section, if the Secretary 

7 determines that the sale or reoffering can be made 

8 on favorable terms. 

9 (2) CONSENT OF OBLIGOR.—In making a sale 

10 or reoffering under paragraph (1), the Secretary 

11 may not change the original terms and conditions of 

12 the secured loan without the written consent of the 

13 obligor. 

14 (e) LOAN GUARANTEES.— 

15 (1) IN GENERAL.—The Secretary may provide a 

16 loan guarantee to a lender in lieu of making a se17 cured loan under this section, if the Secretary deter18 mines that the budgetary cost of the loan guarantee 

19 is substantially the same as that of a secured loan. 

20 (2) TERMS.—The terms of a loan guarantee 

21 provided under this subsection shall be consistent 

22 with the terms established in this section for a se23 cured loan, except that the rate on the guaranteed 

24 loan and any prepayment features shall be negoVerDate Mar 15 2010 23:31 Aug 14, 2014 Jkt 039200 PO 00000 Frm 00044 Fmt 6652 Sfmt 6201 E:\BILLS\H5363.IH H5363

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1 tiated between the obligor and the lender, with the 

2 consent of the Secretary. 

3 SEC. 217. PROGRAM ADMINISTRATION. 

4 (a) REQUIREMENT.—The Secretary shall establish a 

5 uniform system to service the Federal credit instruments 

6 made available under this subtitle. 

7 (b) FEES.—The Secretary may collect and spend 

8 fees, contingent on authority being provided in appropria9 tions Acts, at a level that is sufficient to cover— 

10 (1) the costs of services of expert firms retained 

11 pursuant to subsection (d); and 

12 (2) all or a portion of the costs to the Federal 

13 Government of servicing the Federal credit instru14 ments provided under this subtitle. 

15 (c) SERVICER.— 

16 (1) IN GENERAL.—The Secretary may appoint 

17 a financial entity to assist the Secretary in servicing 

18 the Federal credit instruments provided under this 

19 subtitle. 

20 (2) DUTIES.—A servicer appointed under para21 graph (1) shall act as the agent for the Secretary. 

22 (3) FEE.—A servicer appointed under para23 graph (1) shall receive a servicing fee, subject to ap24 proval by the Secretary. 


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1 (d) ASSISTANCE FROM EXPERTS.—The Secretary 

2 may retain the services, including counsel, of any organi3 zation or entity with expertise in the field of municipal 

4 and project finance to assist in the underwriting and serv5 icing of Federal credit instruments provided under this 

6 subtitle. 

7 (e) LOAN COORDINATION; INTERAGENCY COOPERA8 TION.—The Secretary— 

9 (1) shall coordinate implementation of loan 

10 guarantees under this section with the Administrator 

11 to avoid duplication and enhance the effectiveness of 

12 implementation of the State revolving funds estab13 lished under the Federal Water Pollution Control 

14 Act (33 U.S.C. 1251 et seq.) and the Safe Drinking 

15 Water Act (42 U.S.C. 300f et seq.); 

16 (2) shall consult with the Secretary of Agri17 culture before promulgating criteria with respect to 

18 financial appraisal functions and loan guarantee ad19 ministration for activities carried out under this sub20 title; and 

21 (3) may enter into a memorandum of agree22 ment providing for Department of Agriculture finan23 cial appraisal functions and loan guarantee adminis24 tration for activities carried out under this subtitle. 


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1 SEC. 218. STATE AND LOCAL PERMITS. 

2 The provision of financial assistance for a project 

3 under this subtitle shall not— 

4 (1) relieve any recipient of the assistance of any 

5 obligation to obtain any required State or local per6 mit or approval with respect to the project; 

7 (2) limit the right of any unit of State or local 

8 government to approve or regulate any rate of re9 turn on private equity invested in the project; or 

10 (3) otherwise supersede any State or local law 

11 (including any regulation) applicable to the construc12 tion or operation of the project. 

13 SEC. 219. REGULATIONS. 

14 The Secretary may promulgate such regulations as 

15 the Secretary determines to be appropriate to carry out 

16 this subtitle. 

17 SEC. 220. FUNDING. 

18 (a) IN GENERAL.—There is authorized to be appro19 priated to the Secretary to carry out this subtitle 

20 $50,000,000 for each of fiscal years 2015 through 2019, 

21 to remain available until expended. 

22 (b) ADMINISTRATIVE COSTS.—Of the funds made 

23 available to carry out this subtitle, the Secretary may use 

24 for the administration of this subtitle not more than 

25 $2,200,000 for each of fiscal years 2015 through 2019. 


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1 SEC. 221. REPORT TO CONGRESS. 

2 Not later than 2 years after the date of enactment 

3 of this Act, and every 2 years thereafter, the Secretary 

4 shall submit to the Committee on Energy and Natural Re5 sources of the Senate and the Committee on Natural Re6 sources of the House of Representatives a report summa7 rizing the financial performance and on-the-ground out8 comes of the projects that are receiving, or have received, 

9 assistance under this subtitle, including an assessment of 

10 whether the objectives of this subtitle are being met. 

11 Subtitle B—Integrated Regional 

12 Water Management, Reclama13 tion, and Recycling Projects 

14 SEC. 231. WATER STORAGE PROJECTS. 

15 (a) AGREEMENTS.—The Secretary may enter into a 

16 cost-shared financial assistance agreement with any non17 Federal entity in a Reclamation State or the State of Ha18 waii to carry out the planning, design, and construction 

19 of any permanent water storage and conveyance facility 

20 used solely to regulate and maximize the water supply 

21 arising from a project that is eligible for assistance under 

22 this title or any other provision of law— 

23 (1) to recycle wastewater, impaired surface 

24 water, and ground water; or 

25 (2) to use integrated and coordinated water 

26 management on a watershed or regional scale. 


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1 (b) FINANCIAL ASSISTANCE.—In providing financial 

2 assistance under this section, the Secretary shall give pri3 ority to storage and conveyance components that— 

4 (1) ensure the efficient and beneficial use of 

5 water or reuse of the recycled water; 

6 (2) make maximum use of natural systems; 

7 (3) consistent with Secretarial Order No. 3297, 

8 dated February 22, 2010, support sustainable water 

9 management practices and the water sustainability 

10 objectives of 1 or more offices of the Department of 

11 the Interior or any other Federal agency; 

12 (4)(A) increase the availability of usable water 

13 supplies in a watershed or region to benefit people, 

14 the economy, and the environment; and 

15 (B) include adaptive measures needed to ad16 dress climate change and future demands; 

17 (5) where practicable— 

18 (A) provide flood control or recreation ben19 efits; and 

20 (B) include the development of incremental 

21 hydroelectric power generation; 

22 (6) include partnerships that go beyond political 

23 and institutional jurisdictions to support the effi24 cient use of the limited water resources of the 

25 United States and the applicable region; 


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1 (7) generate environmental benefits, such as 

2 benefits to fisheries, wildlife and habitat, and water 

3 quality and water-dependent ecological systems, as 

4 well as water supply benefits to agricultural and 

5 urban water users; and 

6 (8) the financing of which leverages private and 

7 other non-Federal resources. 

8 (c) FEDERAL SHARE.—The Federal share of the cost 

9 of a project carried out under subsection (a) shall be— 

10 (1) equal to the lesser of— 

11 (A) 50 percent of total cost of the project; 

12 and 

13 (B) $15,000,000, adjusted for inflation; 

14 and 

15 (2) nonreimbursable. 

16 (d) NON-FEDERAL SHARE.—The non-Federal share 

17 of the cost of a project carried out under subsection (a) 

18 may include in-kind contributions to the planning, design, 

19 and construction of a project. 

20 (e) TITLE AND COSTS.—A non-Federal entity enter21 ing into a financial assistance agreement under this sec22 tion shall— 

23 (1) hold title to all facilities constructed under 

24 this section; and 


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1 (2) be solely responsible for the costs of oper2 ating and maintaining those facilities. 

3 SEC. 232. AUTHORIZATION OF APPROPRIATIONS. 

4 There is authorized to be appropriated $150,000,000 

5 to carry out this subtitle. 

6 Subtitle C—Title Transfers 

7 SEC. 241. AUTHORIZATION TO TRANSFER TITLE. 

8 The Secretary may transfer to any non-Federal oper9 ating entity title to any Reclamation project or facility, 

10 or any separable element of such a project or facility, that 

11 is authorized before the date of enactment of this Act, if— 

12 (1) all previous Federal construction contract 

13 obligations or other related repayment contracts or 

14 agreements associated with the project have been 

15 paid out by a non-Federal project beneficiary; 

16 (2)(A) a project facility or separable element of 

17 such a facility is in need of rehabilitation or im18 provement, as determined by the Secretary; and 

19 (B) the non-Federal operating entity is other20 wise eligible for a loan guarantee under this title; 

21 (3) the title transfer meets all applicable Fed22 eral laws and regulations, as determined by the Sec23 retary; and 


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1 (4)(A) the Secretary notifies each congressional 

2 committee of jurisdiction of the transfer by not later 

3 than 60 days before the date of the transfer; and 

4 (B) no objection to the transfer is raised by any 

5 such committee. 

6 TITLE III—INNOVATION 

7 THROUGH RESEARCH, DATA, 

8 AND TECHNOLOGY 

9 SEC. 301. OPEN WATER DATA SYSTEM. 

10 (a) DEFINITIONS.—In this section: 

11 (1) EDUCATIONAL INSTITUTION.—The term 

12 ‘‘educational institution’’ means— 

13 (A) a public or private elementary or sec14 ondary school; 

15 (B) an institution of vocational, profes16 sional, or higher education (including a junior 

17 college or teachers’ college); and 

18 (C) an association of schools or institutions 

19 described in subparagraphs (A) and (B). 

20 (2) INDIAN TRIBE.—The term ‘‘Indian tribe’’ 

21 has the meaning given that term in section 4 of the 

22 Indian Self-Determination and Education Assistance 

23 Act (25 U.S.C. 450b). 


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1 (3) SECRETARY.—The term ‘‘Secretary’’ means 

2 the Secretary of the Interior, acting through the Di3 rector of the United States Geological Survey. 

4 (4) STATE.—The term ‘‘State’’ means— 

5 (A) a State; 

6 (B) the District of Columbia; 

7 (C) the Commonwealth of Puerto Rico; 

8 and 

9 (D) any other territory or possession of the 

10 United States. 

11 (5) SYSTEM.—The term ‘‘system’’ means the 

12 open water data system established under subsection 

13 (b). 

14 (b) SYSTEM.—The Secretary shall establish and 

15 maintain an open water data system within the United 

16 States Geological Survey to advance the availability, time17 ly distribution, and widespread use of water data and in18 formation for water management, education, research, as19 sessment, and monitoring purposes. 

20 (c) PURPOSES.—The purposes of the system are— 

21 (1) to advance the quantification of the avail22 ability, use of, and risks to, water resources through23 out the United States; 

24 (2) to increase accessibility to, and expand the 

25 use of, water data and information in a standard, 


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1 easy-to-use format by Federal, State, local, and trib2 al governments, communities, educational institu3 tions, and the private sector; and 

4 (3) to facilitate the open exchange of water in5 formation particularly in the face of climate change 

6 and unprecedented drought. 

7 (d) ACTIVITIES.—In carrying out this section, the 

8 Secretary shall— 

9 (1) integrate water data and information into a 

10 interoperable, national, geospatially referenced water 

11 data framework; 

12 (2) identify new water data and information 

13 needs, including data on surface and groundwater 

14 quality and quantity, sediment, erosion, transport, 

15 water chemistry, precipitation, reservoir storage, 

16 water cycle, landscape variables, hydrography, cli17 mate and weather impacts, soil moisture, and human 

18 use; 

19 (3) leverage existing shared databases, infra20 structure, and tools to provide a platform for water 

21 data and information innovation, modeling and data 

22 sharing, and solution development; 

23 (4) support water data and information shar24 ing, applied research, and educational programs of 


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1 State, local, and tribal governments, communities, 

2 educational institutions, and the private sector; and 

3 (5) promote cooperation and sharing of exper4 tise regarding water data and information among 

5 State, local, and tribal governments, communities, 

6 educational institutions, and the private sector. 

7 (e) AUTHORIZATION OF APPROPRIATIONS.—There 

8 are authorized to be appropriated to carry out this section 

9 such sums as are necessary. 

10 SEC. 302. WATER RESOURCES RESEARCH ACT AMEND11 MENTS. 

12 (a) CONGRESSIONAL FINDINGS AND DECLARA13 TIONS.—Section 102 of the Water Resources Research 

14 Act of 1984 (42 U.S.C. 10301) is amended— 

15 (1) by redesignating paragraphs (7) through 

16 (9) as paragraphs (8) through (10), respectively; 

17 (2) in paragraph (8) (as so redesignated), by 

18 striking ‘‘and’’ at the end; and 

19 (3) by inserting after paragraph (6) the fol20 lowing: 

21 ‘‘(7) additional research is required to increase 

22 the effectiveness and efficiency of new and existing 

23 treatment works through alternative approaches, in24 cluding— 

25 ‘‘(A) nonstructural alternatives; 


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1 ‘‘(B) decentralized approaches; 

2 ‘‘(C) water use efficiency and conservation; 

3 and 

4 ‘‘(D) actions to reduce energy consumption 

5 or extract energy from wastewater;’’. 

6 (b) WATER RESOURCES RESEARCH AND TECH7 NOLOGY INSTITUTES.—Section 104 of the Water Re8 sources Research Act of 1984 (42 U.S.C. 10303) is 

9 amended— 

10 (1) in subsection (b)(1)— 

11 (A) in subparagraph (B)(ii), by striking 

12 ‘‘water-related phenomena’’ and inserting 

13 ‘‘water resources’’; and 

14 (B) in subparagraph (D), by striking the 

15 period at the end and inserting ‘‘; and’’; 

16 (2) in subsection (c)— 

17 (A) by striking ‘‘From the’’ and inserting 

18 ‘‘(1) IN GENERAL.—From the’’; and 

19 (B) by adding at the end the following: 

20 ‘‘(2) REPORT.—Not later than December 31 of 

21 each fiscal year, the Secretary shall submit to the 

22 Committee on Environment and Public Works of the 

23 Senate, the Committee on the Budget of the Senate, 

24 the Committee on Transportation and Infrastructure 

25 of the House of Representatives, and the Committee 


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1 on the Budget of the House of Representatives a re2 port regarding the compliance of each funding re3 cipient with this subsection for the immediately pre4 ceding fiscal year.’’; 

5 (3) by striking subsection (e) and inserting the 

6 following: 

7 ‘‘(e) EVALUATION OF WATER RESOURCES RESEARCH

8 PROGRAM.— 

9 ‘‘(1) IN GENERAL.—The Secretary shall con10 duct a careful and detailed evaluation of each insti11 tute at least once every 3 years to determine— 

12 ‘‘(A) the quality and relevance of the water 

13 resources research of the institute; 

14 ‘‘(B) the effectiveness of the institute at 

15 producing measured results and applied water 

16 supply research; and 

17 ‘‘(C) whether the effectiveness of the insti18 tute as an institution for planning, conducting, 

19 and arranging for research warrants continued 

20 support under this section. 

21 ‘‘(2) PROHIBITION ON FURTHER SUPPORT.—If, 

22 as a result of an evaluation under paragraph (1), the 

23 Secretary determines that an institute does not qual24 ify for further support under this section, no further 

25 grants to the institute may be provided until the 


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1 qualifications of the institute are reestablished to the 

2 satisfaction of the Secretary.’’; 

3 (4) in subsection (f)(1), by striking 

4 ‘‘$12,000,000 for each of fiscal years 2007 through 

5 2011’’ and inserting ‘‘$7,500,000 for each of fiscal 

6 years 2015 through 2020’’; and 

7 (5) in subsection (g)(1), in the first sentence, 

8 by striking ‘‘$6,000,000 for each of fiscal years 

9 2007 through 2011’’ and inserting ‘‘$1,500,000 for 

10 each of fiscal years 2015 through 2020’’. 

11 SEC. 303. REAUTHORIZATION OF WATER DESALINATION 

12 ACT OF 1996. 

13 Section 8 of the Water Desalination Act of 1996 (42 

14 U.S.C. 10301 note; Public Law 104–298) is amended— 

15 (1) in the first sentence of subsection (a), by 

16 striking ‘‘2013’’ and inserting ‘‘2020’’; and 

17 (2) in subsection (b), by striking ‘‘for each of 

18 fiscal years 2012 through 2013’’ and inserting ‘‘for 

19 each of fiscal years 2015 through 2020’’. 

20 SEC. 304. REVIEW OF RESERVOIR OPERATIONS. 

21 (a) IN GENERAL.—Not later than 1 year after receiv22 ing a request of a non-Federal sponsor of a reservoir, the 

23 Secretary of the Army, in consultation with the Adminis24 trator of the National Oceanic and Atmospheric Adminis25 tration, shall review the operation of the reservoir, includVerDate Mar 15 2010 23:31 Aug 14, 2014 Jkt 039200 PO 00000 Frm 00058 Fmt 6652 Sfmt 6201 E:\BILLS\H5363.IH H5363

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1 ing the water control manual and rule curves, using im2 proved weather forecasts and run-off forecasting methods, 

3 including the Advanced Hydrologic Prediction System of 

4 the National Weather Service and the Hydrometeorology 

5 Testbed program of the National Oceanic and Atmos6 pheric Administration. 

7 (b) DESCRIPTION OF BENEFITS.—In conducting the 

8 review under subsection (a), the Secretary of the Army 

9 shall determine if a change in operations, including the 

10 use of improved weather forecasts and run-off forecasting 

11 methods, will improve 1 or more of the core functions of 

12 the Corps of Engineers, including— 

13 (1) reducing risks to human life, public safety, 

14 and property; 

15 (2) reducing the need for future disaster relief; 

16 (3) improving local water storage capability and 

17 reliability in coordination with the non-Federal spon18 sor and other water users; 

19 (4) restoring, protecting, or mitigating the im20 pacts of a water resources development project on 

21 the environment; and 

22 (5) improving fish species habitat or population 

23 within the boundaries and downstream of a water 

24 resources project. 


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1 (c) RESULTS REPORTED.—Not later than 90 days 

2 after completion of a review under this section, the Sec3 retary shall submit a report to Congress regarding the re4 sults of the review. 

5 (d) MANUAL UPDATE.—As soon as practicable, but 

6 not later than 3 years after the date on which a report 

7 under subsection (c) is submitted to Congress, pursuant 

8 to the procedures required under existing authorities, if 

9 the Secretary of the Army determines based on that report 

10 that using improved weather and run-off forecasting meth11 ods improves 1 or more core functions of the Corps of 

12 Engineers at a reservoir, the Secretary of the Army 

13 shall— 

14 (1) incorporate those methods in the operation 

15 of the reservoir; and 

16 (2) update the water control manual. 

17 TITLE IV—DROUGHT PREPARED18 NESS AND RESILIENCE 

19 SEC. 401. NATIONAL DROUGHT RESILIENCE GUIDELINES. 

20 (a) IN GENERAL.—The Administrator, in conjunction 

21 with the Secretary of the Interior, the Secretary of Agri22 culture, the Director of the National Oceanic and Atmos23 pheric Administration, and other appropriate Federal 

24 agency heads along with State and local governments, 

25 shall develop nonregulatory national drought resilience 


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1 guidelines relating to drought preparedness planning and 

2 investments for communities, water utilities, and other 

3 water users and providers. 

4 (b) CONSULTATION.—In developing the national 

5 drought resilience guidelines, the Administrator and other 

6 Federal agency heads referred to in subsection (a) shall 

7 consult with— 

8 (1) State and local governments; 

9 (2) water utilities; 

10 (3) scientists; 

11 (4) institutions of higher education; 

12 (5) relevant private entities; and 

13 (6) other stakeholders. 

14 (c) CONTENTS.—The national drought resilience 

15 guidelines developed under this section shall, to the max16 imum extent practicable, provide recommendations for a 

17 period of 10 years that— 

18 (1) address a broad range of potential actions, 

19 including— 

20 (A) analysis of the impacts of climate 

21 change and drought on the future effectiveness 

22 of water management tools; 

23 (B) the identification of drought-related 

24 water management challenges in a broad range 

25 of fields, including— 


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1 (i) public health and safety; 

2 (ii) municipal and industrial water 

3 supply; 

4 (iii) agricultural water supply; 

5 (iv) water quality; 

6 (v) ecosystem health; and 

7 (vi) water supply planning; 

8 (C) water management tools to reduce 

9 drought-related impacts, including— 

10 (i) water use efficiency through gal11 lons per capita reduction goals, appliance 

12 efficiency standards, water pricing incen13 tives, and other measures; 

14 (ii) water recycling; 

15 (iii) groundwater clean-up and stor16 age; 

17 (iv) new technologies, such as behav18 ioral water efficiency; and 

19 (v) stormwater capture and reuse; 

20 (D) water-related energy and greenhouse 

21 gas reduction strategies; and 

22 (E) public education and engagement; and 

23 (2) include recommendations relating to the 

24 processes that Federal, State, and local governments 

25 and water utilities should consider when developing 


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1 drought resilience preparedness and plans, includ2 ing— 

3 (A) the establishment of planning goals; 

4 (B) the evaluation of institutional capacity; 

5 (C) the assessment of drought-related risks 

6 and vulnerabilities, including the integration of 

7 climate-related impacts; 

8 (D) the establishment of a development 

9 process, including an evaluation of the cost-ef10 fectiveness of potential strategies; 

11 (E) the inclusion of private entities, tech12 nical advisors, and other stakeholders in the de13 velopment process; 

14 (F) implementation and financing issues; 

15 and 

16 (G) evaluation of the plan, including any 

17 updates to the plan. 

18 SEC. 402. DROUGHT PREPAREDNESS FOR FISHERIES. 

19 (a) DEFINITIONS.—In this section: 

20 (1) INDIAN TRIBE.—The term ‘‘Indian tribe’’ 

21 has the meaning given the term in section 4 of the 

22 Indian Self-Determination and Education Assistance 

23 Act (25 U.S.C. 450b). 

24 (2) QUALIFIED TRIBAL GOVERNMENT.—The 

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1 mental body of an Indian tribe that the Secretary of 

2 the Interior determines— 

3 (A) is involved in salmon management and 

4 recovery activities under the Endangered Spe5 cies Act of 1973 (16 U.S.C. 1531 et seq.); and 

6 (B) has the management and organiza7 tional capability to maximize the benefits of as8 sistance provided under this section. 

9 (b) SALMON DROUGHT PLAN.— 

10 (1) IN GENERAL.—Not later than January 1, 

11 2016, the Director of the United States Fish and 

12 Wildlife Service shall, in consultation with the Direc13 tor of the National Marine Fisheries Service, the 

14 Commissioner of Reclamation, the Chief of Engi15 neers, and the head of the California Department of 

16 Fish and Wildlife, prepare a salmon drought plan 

17 for the State of California. 

18 (2) CONTENTS.—The plan developed under 

19 paragraph (1) shall— 

20 (A) contribute— 

21 (i) to the recovery of populations list22 ed as threatened or endangered under the 

23 Endangered Species Act of 1973 (16 

24 U.S.C. 1531 et seq.); and 


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1 (ii) to the goals of the Central Valley 

2 Project Improvement Act (title XXXIV of 

3 Public Law 102–575; 106 Stat. 4706); and 

4 (B) include options to protect salmon pop5 ulations originating in the State of California, 

6 with a particular focus on actions that can be 

7 taken to aid salmon populations in the State of 

8 California during the driest 12 years, such as— 

9 (i) relocating the release location and 

10 timing of hatchery fish to avoid predation 

11 and temperature impacts; 

12 (ii) barging hatchery release fish to 

13 improve survival and reduce straying; 

14 (iii) coordinating with water users, the 

15 Commissioner of Reclamation, and the 

16 head of the California Department of 

17 Water Resources regarding voluntary 

18 water transfers to determine if water re19 leased upstream to meet the needs of 

20 downstream or South-of-Delta water users 

21 can be managed in a way that provides ad22 ditional benefits for salmon; 

23 (iv) hatchery management modifica24 tions, such as expanding hatchery produc25 tion during the driest years of fish listed 


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1 as endangered or threatened under the En2 dangered Species Act of 1973 (16 U.S.C. 

3 1531 et seq.), if appropriate; and 

4 (v) increasing rescue operations of up5 stream migrating fish. 

6 (c) FUNDING.— 

7 (1) IN GENERAL.—Out of any funds in the 

8 Treasury not otherwise appropriated, the Secretary 

9 of the Treasury shall transfer to the Director of the 

10 United States Fish and Wildlife Service to carry out 

11 this section $3,000,000, to remain available until ex12 pended, for urgent fish, stream, and hatchery activi13 ties relating to extreme drought conditions, including 

14 work carried out in conjunction with the Director of 

15 the National Marine Fisheries Service, the Commis16 sioner of Reclamation, the Chief of Engineers, the 

17 head of the California Department of Fish and 

18 Wildlife, or a qualified tribal government. 

19 (2) RECEIPT AND ACCEPTANCE.—The Director 

20 of the United States Fish and Wildlife Service shall 

21 be entitled to receive, shall accept, and shall use to 

22 carry out this section the funds transferred under 

23 paragraph (1), without further appropriation. 

Æ 


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