I

107TH CONGRESS

1ST SESSION H. R. 1178

To amend the Safe Drinking Water Act to provide grants to small public

drinking water systems.

IN THE HOUSE OF REPRESENTATIVES

MARCH 22, 2001

Mr. GIBBONS (for himself and Mr. UDALL of New Mexico) introduced the

following bill; which was referred to the Committee on Energy and Commerce

A BILL

To amend the Safe Drinking Water Act to provide grants

to small public drinking water systems.

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

3 SECTION 1. SHORT TITLE.

4 This Act may be cited as the ‘‘Small Community

5 Drinking Water Funding Act’’.

6 SEC. 2. FINDINGS AND PURPOSE.

7 (a) FINDINGS.—Congress finds that—

8 (1) in some cases, drinking water standards in

9 effect and proposed as of the date of enactment of

10 this Act can place large financial burdens on public
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1 water systems, especially systems that serve fewer

2 than a few thousand people;

3 (2) some small public water systems have expe4 rienced water contamination problems that may pose

5 a significant risk to the health of water consumers;

6 (3) small communities are concerned about im7 proving drinking water quality;

8 (4) the limited scientific, technical, and profes9 sional resources of many small communities make

10 understanding and implementing regulatory require11 ments very difficult;

12 (5) small communities often struggle to meet

13 water quality standards because of difficulty in se14 curing funding;

15 (6) small communities often lack a tax base or

16 opportunities to benefit from economics of scale and

17 therefore face very high per capita costs in improv18 ing drinking water quality;

19 (7) the smallest public water systems, which

20 serve fewer than 3,300 people, represent 85 percent

21 of all public water systems;

22 (8) small public water systems serving fewer

23 than 10,000 people represent 94 percent of all public

24 water systems;
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1 (9) small communities would benefit from a

2 grant program designed to provide funding for water

3 quality projects without a substantial matching re4 quirement; and

5 (10) Federal programs in effect as of the date

6 of enactment of this Act do not adequately meet the

7 needs of small communities with respect to public

8 water systems.

9 (b) PURPOSE.—The purpose of this Act is to estab10 lish a program to provide grants to small public water sys11 tems to—

12 (1) meet applicable national primary drinking

13 water regulations under the Safe Drinking Water

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

15 (2) maintain water costs at a reasonable level

16 for the communities served by small public water

17 systems; and

18 (3) obtain technical assistance to develop the

19 capacity to sustain operations over the long term.

20 SEC. 3. SMALL PUBLIC WATER SYSTEM ASSISTANCE PRO21 GRAM.

22 (a) DEFINITION OF INDIAN TRIBE.—Section

23 1401(14) of the Safe Drinking Water Act (42 U.S.C.

24 300f(14)) is amended in the second sentence by striking

25 ‘‘1452,’’ and inserting ‘‘1452 and part G,’’.
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1 (b) ESTABLISHMENT OF PROGRAM.—The Safe

2 Drinking Water Act (42 U.S.C. 300f et seq.) is amended

3 by adding at the end the following:

4 ‘‘PART G—SMALL PUBLIC WATER SYSTEM

5 ASSISTANCE

6 ‘‘SEC. 1471. DEFINITIONS.

7 ‘‘In this part:

8 ‘‘(1) ELIGIBLE ACTIVITY.—

9 ‘‘(A) IN GENERAL.—The term ‘eligible ac10 tivity’ means an activity concerning a small

11 public water system (including obtaining tech12 nical assistance) that is carried out by an eligi13 ble entity for a purpose consistent with section

14 1473(c)(1) or 1474(c)(1), as appropriate.

15 ‘‘(B) EXCLUSION.—The term ‘eligible ac16 tivity’ does not include any activity to increase

17 the population served by a small public water

18 system, except to the extent that the State

19 under section 1473(b)(1) or the Administrator

20 under section 1474(b)(1) determines an activity

21 to be necessary to—

22 ‘‘(i) achieve compliance with a na23 tional primary drinking water regulation;

24 and
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1 ‘‘(ii) provide a water supply to a pop2 ulation that, as of the date of enactment of

3 this part, is not served by a safe public

4 water system.

5 ‘‘(2) ELIGIBLE ENTITY.—The term ‘eligible en6 tity’ means a small public water system that—

7 ‘‘(A) is located in a State or an area gov8 erned by an Indian Tribe; and

9 ‘‘(B)(i) if located in a State, serves a com10 munity that, under affordability criteria estab11 lished by the State under section 1452(d)(3), is

12 determined by the State to be—

13 ‘‘(I) a disadvantaged community; or

14 ‘‘(II) a community the State expects

15 to become a disadvantaged community as a

16 result of carrying out an eligible activity;

17 or

18 ‘‘(ii) if located in an area governed by an

19 Indian Tribe, serves a community that is deter20 mined by the Administrator, under criteria pub21 lished by the Administrator under section

22 1452(d)(3) and in consultation with the Sec23 retary, to be—

24 ‘‘(I) a disadvantaged community; or
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1 ‘‘(II) a community the Administrator

2 expects to become a disadvantaged commu3 nity as a result of carrying out an eligible

4 activity.

5 ‘‘(3) ELIGIBLE STATE.—The term ‘eligible

6 State’ means a State that has—

7 ‘‘(A) adopted, and is implementing, an ap8 proved operator certification program under

9 section 1419; and

10 ‘‘(B) established affordability criteria

11 under section 1452(d)(3) for use in identifying

12 disadvantaged communities.

13 ‘‘(4) PROGRAM.—The term ‘Program’ means

14 the Small Public Water System Assistance Program

15 established under section 1472(a).

16 ‘‘(5) SECRETARY.—The term ‘Secretary’ means

17 the Secretary of Health and Human Services, acting

18 through the Director of the Indian Health Service.

19 ‘‘(6) SMALL PUBLIC WATER SYSTEM.—The

20 term ‘small public water system’ means a public

21 water system (including a community water system

22 and a noncommunity water system) that serves a

23 population of 10,000 or fewer.
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1 ‘‘SEC. 1472. SMALL PUBLIC WATER SYSTEM ASSISTANCE

2 PROGRAM.

3 ‘‘(a) ESTABLISHMENT.—Not later than July 1, 2002,

4 the Administrator shall establish within the Environ5 mental Protection Agency a Small Public Water System

6 Assistance Program.

7 ‘‘(b) DUTIES.—The head of the Program shall—

8 ‘‘(1) in accordance with section 1474, establish

9 and administer a small public water system assist10 ance program for, and provide grants to, eligible en11 tities located in areas governed by Indian Tribes, for

12 use in carrying out eligible activities;

13 ‘‘(2) identify, and prepare annual prioritized

14 lists of, activities for eligible entities located in areas

15 governed by Indian Tribes that are eligible for

16 grants under section 1474;

17 ‘‘(3) provide funds to States for use in estab18 lishing small public water system assistance pro19 grams under section 1473 that award grants to eli20 gible entities to carry out eligible activities; and

21 ‘‘(4) prepare, and submit to the Administrator,

22 the reports required under subsection (d).

23 ‘‘(c) ALLOCATION OF FUNDS.—

24 ‘‘(1) STATES.—

25 ‘‘(A) IN GENERAL.—Subject to subpara26 graphs (B) through (D) and paragraph (2)(A),
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1 for each fiscal year, the Administrator, through

2 the head of the Program, using the most recent

3 available needs survey conducted by the Admin4 istrator under section 1452(h), shall allocate

5 the funds made available to carry out the Pro6 gram for the fiscal year among eligible States

7 based on the ratio that—

8 ‘‘(i) the financial need associated with

9 treatment projects for small public water

10 systems in the State; bears to

11 ‘‘(ii) the total financial need associ12 ated with treatment projects for all small

13 public water systems in all States.

14 ‘‘(B) ADDITIONAL REQUIREMENTS.—Any

15 additional financial needs of small public water

16 systems associated with the cost of treatment

17 projects needed to comply with a national pri18 mary drinking water regulation (including a

19 regulation concerning arsenic) that is promul20 gated after the most recent needs survey con21 ducted under section 1452(h) shall be factored

22 into the determination of financial need under

23 clauses (i) and (ii) of subparagraph (A) for

24 each fiscal year.
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1 ‘‘(C) MINIMUM ALLOCATION.—An alloca2 tion of funds to a State for a fiscal year under

3 subparagraph (A), taking into consideration

4 any additional financial needs described in sub5 paragraph (B), shall be in an amount that is at

6 least 1 percent of the amount of funds available

7 for that fiscal year.

8 ‘‘(D) REDISTRIBUTION IF NONUSE.—If a

9 State does not qualify for, or fails to request,

10 funds allocated to the State under subpara11 graph (A) in any fiscal year, the Administrator

12 shall redistribute the funds among the States

13 that—

14 ‘‘(i) request funds for that fiscal year;

15 and

16 ‘‘(ii) are eligible to receive the funds

17 under subparagraph (A) for that fiscal

18 year.

19 ‘‘(2) INDIAN TRIBES.—

20 ‘‘(A) IN GENERAL.—For each fiscal year,

21 in accordance with subparagraph (B), 3 percent

22 of the total amount of funds made available to

23 carry out the Program for the fiscal year shall

24 be allocated by the Administrator to provide

25 grants to eligible entities that are located in
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1 areas governed by Indian Tribes through the

2 program established under section 1474(a).

3 ‘‘(B) USE OF FUNDS.—

4 ‘‘(i) IN GENERAL.—For each fiscal

5 year, the Administrator shall award not

6 less than 1.5 percent of the funds allocated

7 under subparagraph (A) to nonprofit tech8 nical assistance organizations, to be used

9 for the purposes of—

10 ‘‘(I) assisting the Administrator

11 in preparing the list required under

12 section 1474(b) (including assisting

13 the Administrator in identifying the

14 highest priority eligible activities for

15 eligible entities located in areas gov16 erned by Indian Tribes for which a

17 grant under section 1474 may be

18 used);

19 ‘‘(II) assisting eligible entities lo20 cated in areas governed by Indian

21 Tribes in—

22 ‘‘(aa) assessing needs relat23 ing to eligible activities; and

24 ‘‘(bb) identifying available

25 sources of funding to meet the
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1 cost-sharing requirement of sec2 tion 1474(f)(1); and

3 ‘‘(III) assisting eligible entities

4 located in areas governed by Indian

5 Tribes that receive funding under sec6 tion 1474 in—

7 ‘‘(aa) planning, imple8 menting, and maintaining eligible

9 activities that are funded under

10 that section; and

11 ‘‘(bb) preparing reports re12 quired under section 1474(h).

13 ‘‘(ii) CONSULTATION.—Each nonprofit

14 technical assistance organization that re15 ceives funds under clause (i) shall consult

16 with the Administrator, through the head

17 of the program, before carrying out any

18 activity for the purposes described in sub19 clauses (II)(aa) and (III)(aa) of that

20 clause.

21 ‘‘(iii) NO FUNDS FOR LOBBYING EX22 PENSES.—None of the funds made avail23 able to a nonprofit technical assistance or24 ganization under clause (i) shall be used to

25 pay lobbying expenses.
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1 ‘‘(3) PROGRAM.—For each fiscal year, the Ad2 ministrator may use not more than 0.1 percent of

3 the funds made available to carry out the Program

4 to pay reasonable costs incurred in the administra5 tion of the Program.

6 ‘‘(d) REPORTS.—Not later than January 1, 2003,

7 and annually thereafter through January 1, 2007, the Ad8 ministrator shall—

9 ‘‘(1) submit, to the Committee on Energy and

10 Commerce of the House of Representatives and the

11 Committee on Environment and Public Works of the

12 Senate, a report that, for the preceding fiscal year—

13 ‘‘(A) lists the eligible activities for eligible

14 entities, as prepared under sections 1473(b)(1)

15 and 1474(b)(1), located in areas governed by

16 Indian Tribes and in each State receiving funds

17 under this part;

18 ‘‘(B) identifies the number of grants

19 awarded by each State, and by the Adminis20 trator to eligible entities located in areas gov21 erned by Indian Tribes, under this part;

22 ‘‘(C) identifies each eligible entity that re23 ceived a grant to carry out an eligible activity;
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1 ‘‘(D) identifies the amount of each grant

2 provided to an eligible entity to carry out an eli3 gible activity; and

4 ‘‘(E) describes each eligible activity funded

5 by such a grant (including the status of the eli6 gible activity); and

7 ‘‘(2) make the report under paragraph (1)

8 available to the public.

9 ‘‘SEC. 1473. STATE SMALL PUBLIC WATER SYSTEM ASSIST10 ANCE PROGRAMS.

11 ‘‘(a) IN GENERAL.—To be eligible to receive funding

12 under this part, a State shall—

13 ‘‘(1) be an eligible State;

14 ‘‘(2) not later than July 1, 2002 (if funding is

15 sought for fiscal year 2002) or not later than Sep16 tember 30 of any of fiscal years 2002 through 2005

17 (if funding is sought for the following fiscal year),

18 establish a small public water system assistance

19 program—

20 ‘‘(A) under which the requirements of sub21 section (b), oversight, and related activities

22 (other than financial administration) with re23 spect to the program are administered—

24 ‘‘(i) in the case of a State that is ex25 ercising primary enforcement responsibility
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1 for public water systems, by the State

2 agency having primary responsibility for

3 administration of the State program under

4 section 1413; and

5 ‘‘(ii) in the case of a State that is not

6 exercising primary enforcement authority

7 for public water systems, by a State agen8 cy selected by the Governor of the State;

9 and

10 ‘‘(B) that meets the requirements of this

11 section; and

12 ‘‘(3) for each fiscal year for which funding is

13 sought under this section—

14 ‘‘(A) in preparing an intended use plan

15 under section 1452(b), after providing for pub16 lic review and comment, prepare an annual list

17 of eligible activities for eligible entities in the

18 State in accordance with subsection (b); and

19 ‘‘(B) prepare and submit to the Adminis20 trator a request for the funding, by such date

21 and in such form as the Administrator shall

22 prescribe.

23 ‘‘(b) PROGRAM PRIORITY REQUIREMENT.—

24 ‘‘(1) LIST OF ELIGIBLE ACTIVITIES.—A small

25 public water system assistance program established
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1 under subsection (a) shall, for each fiscal year for

2 which funding is sought, identify, and, using the pri3 ority criteria described in paragraph (2) and consid4 ering the additional criteria described in paragraph

5 (3), list in descending order of priority, eligible ac6 tivities for eligible entities in the State for which

7 funds provided from a grant under this part may be

8 used.

9 ‘‘(2) PRIORITY CRITERIA.—In preparing the list

10 under paragraph (1), a small public water system

11 assistance program shall give priority for the use of

12 grants to eligible activities that—

13 ‘‘(A) address the most serious risk to

14 human health;

15 ‘‘(B) are necessary to ensure compliance

16 with national primary water regulations appli17 cable to eligible entities under section 1412;

18 and

19 ‘‘(C) assist systems most in need, as cal20 culated on the basis of median household in21 come, under affordability criteria established by

22 the State under section 1452(d)(3).

23 ‘‘(3) ADDITIONAL CRITERIA.—In addition to

24 the priority criteria described in paragraph (2), a

25 small public water system assistance program shall,
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1 in preparing a list under paragraph (1), consider

2 giving additional priority to any listed eligible activi3 ties that are to be carried out by communities that

4 form management cooperatives (including manage5 ment cooperatives between systems that do not have

6 connections).

7 ‘‘(c) USE OF FUNDS.—Using any funds received by

8 a State under this section for a fiscal year, in accordance

9 with the list prepared under subsection (b), a small public

10 water system assistance program established by the State

11 under subsection (a)—

12 ‘‘(1) shall provide to an eligible entity, on a

13 cost-shared basis, a grant to be used for an eligible

14 activity (including source water protection) the pur15 pose of which is compliance with national primary

16 drinking water regulations applicable to the eligible

17 entity under section 1412;

18 ‘‘(2) shall—

19 ‘‘(A) award not less than 1.5 percent of

20 the funds to nonprofit technical assistance orga21 nizations to be used for the purposes of—

22 ‘‘(i) assisting the State in preparing

23 the list required under subsection (b) (in24 cluding assisting the State in identifying

25 the highest priority eligible activities for el-
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1 igible entities located in the State for

2 which a grant under this section may be

3 used); and

4 ‘‘(ii) assisting eligible entities in—

5 ‘‘(I) assessing needs relating to

6 eligible activities;

7 ‘‘(II) identifying available sources

8 of funding to meet the cost-sharing

9 requirement of subsection (f); and

10 ‘‘(III) planning, implementing,

11 and maintaining any eligible activities

12 of the eligible entities that receive

13 funding under this section;

14 ‘‘(B) require each nonprofit technical as15 sistance organization that receives funds under

16 subparagraph (A) to consult with the State,

17 through the head of the small public water as18 sistance program, before carrying out any activ19 ity for the purposes described in subclauses (I)

20 and (III) of subparagraph (A)(ii); and

21 ‘‘(C) require that none of the funds made

22 available to a nonprofit technical assistance or23 ganization under subparagraph (A) be used to

24 pay lobbying expenses; and
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1 ‘‘(3) may use not to exceed 1 percent of the

2 funds allocated to the State to pay reasonable costs

3 incurred in the administration of the small public

4 water system assistance program.

5 ‘‘(d) LIMITATION ON USE OF FUNDS.—For each fis6 cal year, not more than 5 percent of the funds received

7 by an eligible entity under this section may be used to

8 obtain technical assistance in planning, implementing, and

9 maintaining eligible activities that are funded under this

10 section.

11 ‘‘(e) LIMITATION ON RECEIPT OF FUNDS.—

12 ‘‘(1) IN GENERAL.—Except as provided in para13 graph (2), a grant under this section shall not be

14 provided to an eligible entity that, as determined by

15 the State—

16 ‘‘(A) does not have the technical, manage17 rial, and financial capability to ensure compli18 ance with national primary drinking water reg19 ulations applicable to the eligible entity under

20 section 1412; or

21 ‘‘(B) is in significant noncompliance with

22 any applicable national primary drinking water

23 regulation.
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1 ‘‘(2) EXCEPTION FOR RECEIPT OF GRANT.—An

2 eligible entity described in paragraph (1) may re3 ceive a grant under this section only—

4 ‘‘(A) if the State determines that use of

5 the grant will ensure compliance with national

6 primary drinking water regulations applicable

7 to the eligible entity under section 1412;

8 ‘‘(B)(i) to restructure or consolidate the

9 facility to achieve compliance with applicable

10 national primary drinking water regulations; or

11 ‘‘(ii) in a case in which restructuring or

12 consolidation of the facility is not practicable, if

13 the State determines that—

14 ‘‘(I) the eligible entity has made a

15 good faith effort to achieve compliance

16 with applicable national primary drinking

17 water regulations; and

18 ‘‘(II) the eligible entity is adhering to

19 an enforceable schedule for achieving those

20 regulations; and

21 ‘‘(C) in a case in which paragraph (1)(A)

22 applies to an eligible entity, and the eligible en23 tity agrees to undertake feasible and appro24 priate changes in operations (including changes

25 in ownership, management, accounting, rates,
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1 maintenance, consolidation, provision of an al2 ternative water supply, or other procedures), if

3 the State determines that the measures are nec4 essary to ensure that the eligible entity has the

5 technical, managerial, and financial capability

6 to comply with applicable national primary

7 drinking water regulations over the long term.

8 ‘‘(3) REVIEW.—Before providing assistance

9 under this section to an eligible entity that is in sig10 nificant noncompliance with any national primary

11 drinking water regulation applicable to the eligible

12 entity under section 1412, the State shall conduct a

13 review to determine whether paragraph (1)(A) ap14 plies to the entity.

15 ‘‘(f) COST SHARING.—

16 ‘‘(1) IN GENERAL.—

17 ‘‘(A) LIMIT.—Except as provided in para18 graph (2), the share of the total cost of an eligi19 ble activity funded by a grant under this section

20 shall not exceed 80 percent.

21 ‘‘(B) USE OF OTHER FEDERAL FUNDS.—

22 To pay the portion of an eligible activity that

23 may not be funded by a grant under this sec24 tion, an eligible entity may use Federal finan-
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1 cial assistance other than assistance received

2 under this section.

3 ‘‘(2) WAIVER OF COST-SHARING REQUIRE4 MENT.—

5 ‘‘(A) IN GENERAL.—Subject to subpara6 graph (B), a State may waive the requirement

7 of an eligible entity to pay all or a portion of

8 the share of an eligible activity that may not be

9 funded by a grant under this section, based on

10 a determination by the State that the eligible

11 entity is unable to pay any or all of the share.

12 ‘‘(B) LIMITATION.—For each fiscal year in

13 which a State receives funding under this sec14 tion, the total amount of cost-share waivers

15 provided by the State under subparagraph (A)

16 shall not exceed 30 percent of the amount of

17 funding received by the State for the fiscal year

18 under section 1472(c)(1).

19 ‘‘(g) UNOBLIGATED FUNDS.—Any funds not obli20 gated by the State for a purpose consistent with sub21 section (c) within 1 year after the date of the allocation

22 of the funds by the Administrator under section 1472(c)

23 shall be returned to the Administrator for reallocation

24 under that section.
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1 ‘‘(h) REPORTS.—Not later than November 1 fol2 lowing each fiscal year in which a State receives funding

3 under this section, the State shall—

4 ‘‘(1) submit to the Administrator a report that,

5 for the preceding fiscal year—

6 ‘‘(A) lists the eligible activities for eligible

7 entities, as prepared under subsection (b);

8 ‘‘(B) identifies the number of grants

9 awarded by the State small public water system

10 assistance program to eligible entities;

11 ‘‘(C) identifies each eligible entity that re12 ceived a grant to carry out an eligible activity;

13 ‘‘(D) identifies the amount of each grant

14 provided to an eligible entity to carry out an eli15 gible activity; and

16 ‘‘(E) describes each eligible activity funded

17 by such grants (including the status of the eli18 gible activity); and

19 ‘‘(2) make the report under paragraph (1)

20 available to the public.

21 ‘‘SEC. 1474. SMALL PUBLIC WATER SYSTEM ASSISTANCE

22 PROGRAM FOR INDIAN TRIBES.

23 ‘‘(a) ESTABLISHMENT.—Not later than July 1, 2002,

24 the Administrator shall establish a small public water sys25 tem assistance program for Indian Tribes, through which
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1 eligible entities located in areas governed by the Indian

2 Tribe may receive grants for eligible activities under this

3 part.

4 ‘‘(b) PROGRAM PRIORITY REQUIREMENT.—

5 ‘‘(1) LIST OF ELIGIBLE ACTIVITIES.—

6 ‘‘(A) IN GENERAL.—The Administrator,

7 acting through the head of the small public

8 water system assistance program for Indian

9 Tribes, in consultation with the Secretary, shall,

10 for each fiscal year, identify, and, using the pri11 ority criteria described in paragraph (2) and

12 considering the additional criteria described in

13 paragraph (3), list in descending order of pri14 ority, eligible activities for eligible entities lo15 cated in areas governed by Indian Tribes for

16 which funds provided from a grant under this

17 part may be used.

18 ‘‘(B) COORDINATION.—

19 ‘‘(i) IN GENERAL.—To the maximum

20 extent practicable, the Administrator shall

21 ensure that the list under subparagraph

22 (A) is coordinated with any needs assess23 ment conducted under section 1452(i)(4).

24 ‘‘(ii) ADDITIONAL CONSIDERATION.—

25 Any additional financial needs of small
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1 public water systems located in areas gov2 erned by Indian Tribes that are associated

3 with the cost of complying with a national

4 primary drinking water regulation (includ5 ing a regulation concerning arsenic) that is

6 promulgated after the most recent needs

7 survey conducted under section 1452(i)(4)

8 shall be factored into the determination of

9 financial need for, and prioritization of, eli10 gible activities under this section.

11 ‘‘(2) PRIORITY CRITERIA.—In preparing the list

12 under paragraph (1), the Administrator shall give

13 priority for the use of grants to eligible activities

14 that—

15 ‘‘(A) address the most serious risk to

16 human health;

17 ‘‘(B) are necessary to ensure compliance

18 with national primary water regulations appli19 cable to eligible entities under section 1412;

20 and

21 ‘‘(C) assist systems most in need, as cal22 culated on the basis of median household in23 come, under affordability criteria published by

24 the Administrator under section 1452(d)(3).
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1 ‘‘(3) ADDITIONAL CRITERIA.—In addition to

2 the priority criteria described in paragraph (2), the

3 Administrator shall, in preparing a list under para4 graph (1), consider giving additional priority to any

5 listed eligible activities that are to be carried out by

6 communities that form management cooperatives

7 (including management cooperatives between sys8 tems that do not have connections).

9 ‘‘(c) USE OF FUNDS.—

10 ‘‘(1) IN GENERAL.—Using funds allocated

11 under section 1472(c)(2)(A), the small public water

12 system assistance program established under sub13 section (a) shall provide to an eligible entity located

14 in an area governed by an Indian Tribe, on a cost15 shared basis, a grant to be used for an eligible activ16 ity (including source water protection) the purpose

17 of which is compliance with national primary drink18 ing water regulations applicable to the eligible entity

19 under section 1412.

20 ‘‘(2) ALLOCATION OF GRANT FUNDING.—For

21 each fiscal year, taking into consideration the fund22 ing allocation under section 1472(c)(2)(A) for the

23 fiscal year, the head of the small public water assist24 ance program established under subsection (a), in

25 consultation with the Secretary, shall provide grants
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1 under paragraph (1) for the maximum number of el2 igible activities for which the funding allocation

3 makes assistance available, based on the priority as4 signed by the Administrator to eligible activities

5 under subsection (b).

6 ‘‘(d) LIMITATION ON USE OF FUNDS.—For each fis7 cal year, not more than 5 percent of the funds received

8 by an eligible entity under this section may be used to

9 obtain technical assistance in planning, implementing, and

10 maintaining eligible activities that are funded under this

11 section.

12 ‘‘(e) LIMITATION ON RECEIPT OF FUNDS.—

13 ‘‘(1) IN GENERAL.—Except as provided in para14 graph (2), a grant under this section shall not be

15 provided to an eligible entity that, as determined by

16 the Administrator—

17 ‘‘(A) does not have the technical, manage18 rial, and financial capability to ensure compli19 ance with national primary drinking water reg20 ulations applicable to the eligible entity under

21 section 1412; or

22 ‘‘(B) is in significant noncompliance with

23 any applicable national primary drinking water

24 regulation.
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1 ‘‘(2) EXCEPTION FOR RECEIPT OF GRANT.—An

2 eligible entity described in paragraph (1) may re3 ceive a grant under this section only—

4 ‘‘(A) if the Administrator determines that

5 use of the grant will ensure compliance with na6 tional primary drinking water regulations appli7 cable to the eligible entity under section 1412;

8 ‘‘(B)(i) to restructure or consolidate the

9 facility to achieve compliance with applicable

10 national primary drinking water regulations; or

11 ‘‘(ii) in a case in which restructuring or

12 consolidation of the facility is not practicable, if

13 the Administrator determines that—

14 ‘‘(I) the eligible entity has made a

15 good faith effort to achieve compliance

16 with applicable national primary drinking

17 water regulations; and

18 ‘‘(II) the eligible entity is adhering to

19 an enforceable schedule for achieving those

20 regulations; and

21 ‘‘(C) in a case in which paragraph (1)(A)

22 applies to an eligible entity, and the eligible en23 tity agrees to undertake feasible and appro24 priate changes in operations (including changes

25 in ownership, management, accounting, rates,
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1 maintenance, consolidation, provision of an al2 ternative water supply, or other procedures), if

3 the Administrator determines that the measures

4 are necessary to ensure that the eligible entity

5 has the technical, managerial, and financial ca6 pability to comply with applicable national pri7 mary drinking water regulations over the long

8 term.

9 ‘‘(3) REVIEW.—Before providing assistance

10 under this section to an eligible entity that is in sig11 nificant noncompliance with any national primary

12 drinking water regulation applicable to the eligible

13 entity under section 1412, the Administrator shall

14 conduct a review to determine whether paragraph

15 (1)(A) applies to the entity.

16 ‘‘(f) COST SHARING.—

17 ‘‘(1) IN GENERAL.—

18 ‘‘(A) LIMIT.—Except as provided in para19 graph (2), the share of the total cost of an eligi20 ble activity funded by a grant under this section

21 shall not exceed 80 percent.

22 ‘‘(B) USE OF OTHER FEDERAL FUNDS.—

23 To pay the portion of an eligible activity that

24 may not be funded by a grant under this sec25 tion, an eligible entity may use Federal finan-
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1 cial assistance other than assistance received

2 under this section.

3 ‘‘(2) WAIVER OF COST-SHARING REQUIRE4 MENT.—

5 ‘‘(A) IN GENERAL.—The Administrator

6 may waive the requirement of an eligible entity

7 to pay all or a portion of the share of eligible

8 activity that may not be funded by a grant

9 under this section based on a determination by

10 the Administrator that the eligible entity is un11 able to pay any or all of the share.

12 ‘‘(B) LIMITATION.—For each fiscal year,

13 the total amount of cost-share waivers provided

14 by the Administrator under subparagraph (A)

15 shall not exceed 30 percent of the amount of

16 funding allocated to eligible entities located in

17 areas governed by Indian Tribes for the fiscal

18 year under section 1472(c)(2)(A).

19 ‘‘(g) UNOBLIGATED FUNDS.—Any funds not obli20 gated by the small public water system assistance program

21 established under subsection (a) for a purpose consistent

22 with section 1472(c)(2)(B) and subsection (c) within 1

23 year after the date of allocation of the funds by the Ad24 ministrator under section 1472(c)(2)(A) shall be returned

25 to the Administrator for reallocation under that section.
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1 ‘‘(h) REPORTS.—Not later than November 1 fol2 lowing each fiscal year in which an Indian Tribe receives

3 funding under this section, the Indian Tribe shall submit

4 to the Administrator a report that, for the preceding fiscal

5 year—

6 ‘‘(1) identifies the number of grants awarded to

7 eligible entities located in areas governed by the In8 dian Tribe;

9 ‘‘(2) identifies each such eligible entity that re10 ceived a grant to carry out an eligible activity;

11 ‘‘(3) identifies the amount of each grant pro12 vided to such an eligible entity to carry out an eligi13 ble activity; and

14 ‘‘(4) describes each eligible activity funded by

15 such grants (including the status of the eligible ac16 tivity).

17 ‘‘SEC. 1475. AUTHORIZATION OF APPROPRIATIONS.

18 ‘‘There is authorized to be appropriated to carry out

19 this part $750,000,000 for each of fiscal years 2002

20 through 2006.’’.

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