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[Congressional Bills 112th Congress]
[From the U.S. Government Publishing Office]
[H.R. 3145 Introduced in House (IH)]

112th CONGRESS
  1st Session
                                H. R. 3145

     To amend the Federal Water Pollution Control Act to authorize 
 appropriations for State water pollution control revolving funds, and 
                          for other purposes.

_______________________________________________________________________

                    IN THE HOUSE OF REPRESENTATIVES

                            October 11, 2011

 Mr. Bishop of New York (for himself, Mr. Rahall, Mr. LaTourette, and 
  Mr. Petri) introduced the following bill; which was referred to the 
Committee on Transportation and Infrastructure, and in addition to the 
Committee on Ways and Means, 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 amend the Federal Water Pollution Control Act to authorize 
 appropriations for State water pollution control revolving funds, and 
                          for other purposes.

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

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

    (a) In General.--This Act may be cited as the ``Water Quality 
Protection and Job Creation Act of 2011''.
    (b) Table of Contents.--

Sec. 1. Short title; table of contents.
Sec. 2. Amendment of Federal Water Pollution Control Act.
                    TITLE I--WATER QUALITY FINANCING

            Subtitle A--Technical and Management Assistance

Sec. 1101. Technical assistance.
Sec. 1102. State management assistance.
Sec. 1103. Watershed pilot projects.
              Subtitle B--Construction of Treatment Works

Sec. 1201. Sewage collection systems.
Sec. 1202. Treatment works defined.
       Subtitle C--State Water Pollution Control Revolving Funds

Sec. 1301. General authority for capitalization grants.
Sec. 1302. Capitalization grant agreements.
Sec. 1303. Water pollution control revolving loan funds.
Sec. 1304. Allotment of funds.
Sec. 1305. Intended use plan.
Sec. 1306. Annual Reports.
Sec. 1307. Technical assistance; requirements for use of American 
                            materials.
Sec. 1308. Economic hardship waiver.
Sec. 1309. Authorization of appropriations.
                     Subtitle D--General Provisions

Sec. 1401. Definition of treatment works.
Sec. 1402. Funding for Indian programs.
                       Subtitle E--Tonnage Duties

Sec. 1501. Tonnage duties.
              TITLE II--ALTERNATIVE WATER SOURCE PROJECTS

Sec. 2001. Pilot program for alternative water source projects.
                TITLE III--SEWER OVERFLOW CONTROL GRANTS

Sec. 3001. Sewer overflow control grants.
                    TITLE IV--CLEAN WATER TRUST FUND

Sec. 4001. Establishment of Clean Water Trust Fund.
Sec. 4002. Allocation of funds.
Sec. 4003. Revenues for Clean Water Trust Fund.
              TITLE V--WATER POLLUTION CONTROL INVESTMENT

Sec. 5001. Short title.
Sec. 5002. Definitions.
Sec. 5003. Direct loans.
Sec. 5004. Guarantees.
Sec. 5005. Funding.

SEC. 2. AMENDMENT OF FEDERAL WATER POLLUTION CONTROL ACT.

    Except as otherwise expressly provided, whenever in this Act an 
amendment or repeal is expressed in terms of an amendment to, or repeal 
of, a section or other provision, the reference shall be considered to 
be made to a section or other provision of the Federal Water Pollution 
Control Act (33 U.S.C. 1251 et seq.).

                    TITLE I--WATER QUALITY FINANCING

            Subtitle A--Technical and Management Assistance

SEC. 1101. TECHNICAL ASSISTANCE.

    (a) Technical Assistance for Rural and Small Treatment Works.--
Section 104(b) (33 U.S.C. 1254(b)) is amended--
            (1) by striking ``and'' at the end of paragraph (6);
            (2) by striking the period at the end of paragraph (7) and 
        inserting ``; and''; and
            (3) by adding at the end the following:
            ``(8) make grants to nonprofit organizations--
                    ``(A) to provide technical assistance to rural and 
                small municipalities and tribal governments for the 
                purpose of assisting, in consultation with the State in 
                which the assistance is provided, such municipalities 
                and tribal governments in the planning, developing, and 
                acquisition of financing for eligible projects 
                described in section 603(c);
                    ``(B) to provide technical assistance and training 
                for rural, small, and tribal publicly owned treatment 
                works and decentralized wastewater treatment systems to 
                enable such treatment works and systems to protect 
                water quality and achieve and maintain compliance with 
                the requirements of this Act; and
                    ``(C) to disseminate information to rural, small, 
                and tribal municipalities and municipalities that meet 
                the affordability criteria established under section 
                603(i)(2) by the State in which the municipality is 
                located with respect to planning, design, construction, 
                and operation of publicly owned treatment works and 
                decentralized wastewater treatment systems.''.
    (b) Authorization of Appropriations.--Section 104(u) (33 U.S.C. 
1254(u)) is amended--
            (1) by striking ``and (6)'' and inserting ``(6)''; and
            (2) by inserting before the period at the end the 
        following: ``; and (7) not to exceed $100,000,000 for each of 
        fiscal years 2012 through 2016 for carrying out subsections 
        (b)(3), (b)(8), and (g), except that not less than 20 percent 
        of the amounts appropriated pursuant to this paragraph in a 
        fiscal year shall be used for carrying out subsection (b)(8)''.
    (c) Small Flows Clearinghouse.--Section 104(q)(4) (33 U.S.C. 
1254(q)(4)) is amended--
            (1) in the first sentence by striking ``$1,000,000'' and 
        inserting ``$3,000,000''; and
            (2) in the second sentence by striking ``1986'' and 
        inserting ``2016''.

SEC. 1102. STATE MANAGEMENT ASSISTANCE.

    (a) Authorization of Appropriations.--Section 106(a) (33 U.S.C. 
1256(a)) is amended--
            (1) by striking ``and'' at the end of paragraph (1);
            (2) by striking the semicolon at the end of paragraph (2) 
        and inserting ``; and''; and
            (3) by inserting after paragraph (2) the following:
            ``(3) such sums as may be necessary for each of fiscal 
        years 1991 through 2011, and $300,000,000 for each of fiscal 
        years 2012 through 2016;''.
    (b) Technical Amendment.--Section 106(e) (33 U.S.C. 1256(e)) is 
amended by striking ``Beginning in fiscal year 1974 the'' and inserting 
``The''.

SEC. 1103. WATERSHED PILOT PROJECTS.

    (a) Pilot Projects.--Section 122 (33 U.S.C. 1274) is amended--
            (1) in the section heading by striking ``wet weather''; and
            (2) in subsection (a)--
                    (A) in the matter preceding paragraph (1)--
                            (i) by striking ``for treatment works'' and 
                        inserting ``to a municipality or municipal 
                        entity''; and
                            (ii) by striking ``wet weather discharge'';
                    (B) in paragraph (2) by striking ``in reducing such 
                pollutants'' and all that follows before the period at 
                the end and inserting ``to manage, reduce, treat, or 
                reuse municipal stormwater, including low-impact 
                development technologies and other techniques that 
                utilize infiltration, evapotranspiration, and reuse of 
                storm water on site''; and
                    (C) by adding at the end the following:
            ``(3) Watershed partnerships.--Efforts of municipalities 
        and property owners to demonstrate cooperative ways to address 
        nonpoint sources of pollution to reduce adverse impacts on 
        water quality.
            ``(4) Integrated water resource plan.--The development of 
        an integrated water resource plan for the coordinated 
        management and protection of surface water, ground water, and 
        stormwater resources on a watershed or subwatershed basis to 
        meet the objectives, goals, and policies of this Act.
            ``(5) Municipality-wide storm water management planning.--
        The development of a municipality-wide plan that identifies the 
        most effective placement of storm water technologies and 
        management approaches, including green infrastructure, to 
        reduce water quality impairments from storm water on a 
        municipality-wide basis.''.
    (b) Authorization of Appropriations.--The first sentence of section 
122(c)(1) is amended--
            (1) by striking ``and''; and
            (2) by striking the period and inserting ``, such sums as 
        may be necessary for each of fiscal years 2005 through 2011, 
        and $120,000,000 for each of fiscal years 2012 through 2016''.
    (c) Report to Congress.--Section 122(d) is amended by striking ``5 
years after the date of enactment of this section,'' and inserting 
``October 1, 2013,''.

              Subtitle B--Construction of Treatment Works

SEC. 1201. SEWAGE COLLECTION SYSTEMS.

    Section 211 (33 U.S.C. 1291) is amended--
            (1) by striking the section heading and all that follows 
        through ``(a) No'' and inserting the following:

``SEC. 211. SEWAGE COLLECTION SYSTEMS.

    ``(a) In General.--No'';
            (2) in subsection (b) by inserting ``Population Density.--
        '' after ``(b)''; and
            (3) by striking subsection (c) and inserting the following:
    ``(c) Exceptions.--
            ``(1) Replacement and major rehabilitation.--
        Notwithstanding the requirement of subsection (a)(1) concerning 
        the existence of a collection system as a condition of 
        eligibility, a project for replacement or major rehabilitation 
        of a collection system existing on January 1, 2007, shall be 
        eligible for a grant under this title if the project otherwise 
        meets the requirements of subsection (a)(1) and meets the 
        requirement of paragraph (3).
            ``(2) New systems.--Notwithstanding the requirement of 
        subsection (a)(2) concerning the existence of a community as a 
        condition of eligibility, a project for a new collection system 
        to serve a community existing on January 1, 2007, shall be 
        eligible for a grant under this title if the project otherwise 
        meets the requirements of subsection (a)(2) and meets the 
        requirement of paragraph (3).
            ``(3) Requirement.--A project meets the requirement of this 
        paragraph if the purpose of the project is to accomplish the 
        objectives, goals, and policies of this Act by addressing an 
        adverse environmental condition existing on the date of 
        enactment of this paragraph.''.

SEC. 1202. TREATMENT WORKS DEFINED.

    Section 212(2)(A) (33 U.S.C. 1292(2)(A)) is amended--
            (1) by striking ``any works, including site'';
            (2) by striking ``is used for ultimate'' and inserting 
        ``will be used for ultimate''; and
            (3) by inserting before the period at the end the 
        following: ``and acquisition of other lands, and interests in 
        lands, which are necessary for construction''.

       Subtitle C--State Water Pollution Control Revolving Funds

SEC. 1301. GENERAL AUTHORITY FOR CAPITALIZATION GRANTS.

    Section 601(a) (33 U.S.C. 1381(a)) is amended by striking ``for 
providing assistance'' and all that follows through the period at the 
end and inserting the following: ``to accomplish the objectives, goals, 
and policies of this Act by providing assistance for projects and 
activities identified in section 603(c).''.

SEC. 1302. CAPITALIZATION GRANT AGREEMENTS.

    (a) Reporting Infrastructure Assets.--Section 602(b)(9) (33 U.S.C. 
1382(b)(9)) is amended by striking ``standards'' and inserting 
``standards, including standards relating to the reporting of 
infrastructure assets''.
    (b) Additional Requirements.--Section 602(b) (33 U.S.C. 1382(b)) is 
amended--
            (1) in paragraph (6)--
                    (A) by striking ``before fiscal year 1995'';
                    (B) by striking ``funds directly made available by 
                capitalization grants under this title and section 
                205(m) of this Act'' and inserting ``assistance made 
                available by a State water pollution control revolving 
                fund as authorized under this title, or with assistance 
                made available under section 205(m), or both,''; and
                    (C) by striking ``201(b)'' and all that follows 
                through ``513'' and inserting ``211 and 511(c)(1)'';
            (2) by striking ``and'' at the end of paragraph (9);
            (3) by striking the period at the end of paragraph (10) and 
        inserting a semicolon; and
            (4) by adding at the end the following:
            ``(11) the State will establish, maintain, invest, and 
        credit the fund with repayments, such that the fund balance 
        will be available in perpetuity for providing financial 
        assistance in accordance with this title;
            ``(12) any fees charged by the State to recipients of 
        assistance that are considered program income will be used for 
        the purpose of financing the cost of administering the fund or 
        financing projects or activities eligible for assistance from 
        the fund;
            ``(13) beginning in fiscal year 2013, the State will 
        include as a condition of providing assistance to a 
        municipality or intermunicipal, interstate, or State agency 
        that the recipient of such assistance certify, in a manner 
        determined by the Governor of the State, that the recipient--
                    ``(A) has studied and evaluated the cost and 
                effectiveness of the processes, materials, techniques, 
                and technologies for carrying out the proposed project 
                or activity for which assistance is sought under this 
                title, and has selected, to the extent practicable, a 
                project or activity that maximizes the potential for 
                efficient water use, reuse, and conservation, and 
                energy conservation, taking into account the cost of 
                constructing the project or activity, the cost of 
                operating and maintaining the project or activity over 
                its life, and the cost of replacing the project or 
                activity; and
                    ``(B) has considered, to the maximum extent 
                practicable and as determined appropriate by the 
                recipient, the costs and effectiveness of other design, 
                management, and financing approaches for carrying out a 
                project or activity for which assistance is sought 
                under this title, taking into account the cost of 
                constructing the project or activity, the cost of 
                operating and maintaining the project or activity over 
                its life, and the cost of replacing the project or 
                activity;
            ``(14) the State will use at least 15 percent of the amount 
        of each capitalization grant received by the State under this 
        title after September 30, 2010, to provide assistance to 
        municipalities of fewer than 10,000 individuals that meet the 
        affordability criteria established by the State under section 
        603(i)(2) for projects or activities included on the State's 
        priority list established under section 603(g), to the extent 
        that there are sufficient applications for such assistance;
            ``(15) a contract to be carried out using funds directly 
        made available by a capitalization grant under this title for 
        program management, construction management, feasibility 
        studies, preliminary engineering, design, engineering, 
        surveying, mapping, or architectural related services shall be 
        negotiated in the same manner as a contract for architectural 
        and engineering services is negotiated under chapter 11 of 
        title 40, United States Code, or an equivalent State 
        qualifications-based requirement (as determined by the Governor 
        of the State); and
            ``(16) the requirements of section 513 will apply to the 
        construction of treatment works carried out in whole or in part 
        with assistance made available by a State water pollution 
        control revolving fund as authorized under this title, or with 
        assistance made available under section 205(m), or both, in the 
        same manner as treatment works for which grants are made under 
        this Act.''.

SEC. 1303. WATER POLLUTION CONTROL REVOLVING LOAN FUNDS.

    (a) Projects and Activities Eligible for Assistance.--Section 
603(c) (33 U.S.C. 1383(c)) is amended to read as follows:
    ``(c) Projects and Activities Eligible for Assistance.--The amounts 
of funds available to each State water pollution control revolving fund 
shall be used only for providing financial assistance--
            ``(1) to any municipality or intermunicipal, interstate, or 
        State agency for construction of publicly owned treatment 
        works;
            ``(2) for the implementation of a management program 
        established under section 319;
            ``(3) for development and implementation of a conservation 
        and management plan under section 320;
            ``(4) for repair or replacement of decentralized wastewater 
        treatment systems that treat domestic sewage;
            ``(5) for measures to manage, reduce, treat, or reuse 
        municipal stormwater;
            ``(6) to any municipality or intermunicipal, interstate, or 
        State agency for measures to reduce the demand for publicly 
        owned treatment works capacity through water conservation, 
        efficiency, or reuse;
            ``(7) for the development and implementation of watershed 
        projects meeting the criteria set forth in section 122; and
            ``(8) to any municipality or intermunicipal, interstate, or 
        State agency for measures to reduce the energy consumption 
        needs for publicly owned treatment works, including the 
        implementation of energy-efficient or renewable-energy 
        generation technologies.''.
    (b) Extended Repayment Period.--Section 603(d)(1) (33 U.S.C. 
1383(d)(1)) is amended--
            (1) in subparagraph (A) by striking ``20 years'' and 
        inserting ``the lesser of 30 years or the design life of the 
        project to be financed with the proceeds of the loan''; and
            (2) in subparagraph (B) by striking ``not later than 20 
        years after project completion'' and inserting ``upon the 
        expiration of the term of the loan''.
    (c) Fiscal Sustainability Plan.--Section 603(d)(1) (33 U.S.C. 
1383(d)(1)) is further amended--
            (1) by striking ``and'' at the end of subparagraph (C);
            (2) by inserting ``and'' at the end of subparagraph (D); 
        and
            (3) by adding at the end the following:
                    ``(E) for any portion of a treatment works proposed 
                for repair, replacement, or expansion, and eligible for 
                assistance under section 603(c)(1), the recipient of a 
                loan will develop and implement a fiscal sustainability 
                plan that includes--
                            ``(i) an inventory of critical assets that 
                        are a part of that portion of the treatment 
                        works;
                            ``(ii) an evaluation of the condition and 
                        performance of inventoried assets or asset 
                        groupings;
                            ``(iii) a certification that the recipient 
                        has evaluated and will be implementing water 
                        and energy conservation efforts as part of the 
                        plan; and
                            ``(iv) a plan for maintaining, repairing, 
                        and, as necessary, replacing that portion of 
                        the treatment works and a plan for funding such 
                        activities;''.
    (d) Administrative Expenses.--Section 603(d)(7) (33 U.S.C. 
1383(d)(7)) is amended by inserting before the period at the end the 
following: ``, $400,000 per year, or \1/5\ percent per year of the 
current valuation of the fund, whichever amount is greatest, plus the 
amount of any fees collected by the State for such purpose regardless 
of the source''.
    (e) Technical and Planning Assistance for Small Systems.--Section 
603(d) (33 U.S.C. 1383(d)) is amended--
            (1) by striking ``and'' at the end of paragraph (6);
            (2) by striking the period at the end of paragraph (7) and 
        inserting a semicolon; and
            (3) by adding at the end the following:
            ``(8) to provide grants to owners and operators of 
        treatment works that serve a population of 10,000 or fewer for 
        obtaining technical and planning assistance and assistance in 
        financial management, user fee analysis, budgeting, capital 
        improvement planning, facility operation and maintenance, 
        equipment replacement, repair schedules, and other activities 
        to improve wastewater treatment plant management and 
        operations, except that the total amount provided by the State 
        in grants under this paragraph for a fiscal year may not exceed 
        one percent of the total amount of assistance provided by the 
        State from the fund in the preceding fiscal year, or 2 percent 
        of the total amount received by the State in capitalization 
        grants under this title in the preceding fiscal year, whichever 
        amount is greatest; and
            ``(9) to provide grants to owners and operators of 
        treatment works for conducting an assessment of the energy and 
        water consumption of the treatment works, and evaluating 
        potential opportunities for energy and water conservation 
        through facility operation and maintenance, equipment 
        replacement, and projects or activities that promote the 
        efficient use of energy and water by the treatment works, 
        except that the total amount provided by the State in grants 
        under this paragraph for a fiscal year may not exceed one 
        percent of the total amount of assistance provided by the State 
        from the fund in the preceding fiscal year, or 2 percent of the 
        total amount received by the State in capitalization grants 
        under this title in the preceding fiscal year, whichever amount 
        is greatest.''.
    (f) Additional Subsidization.--Section 603 (33 U.S.C. 1383) is 
amended by adding at the end the following:
    ``(i) Additional Subsidization.--
            ``(1) In general.--In any case in which a State provides 
        assistance to a municipality or intermunicipal, interstate, or 
        State agency under subsection (d), the State may provide 
        additional subsidization, including forgiveness of principal 
        and negative interest loans--
                    ``(A) to benefit a municipality that--
                            ``(i) meets the State's affordability 
                        criteria established under paragraph (2); or
                            ``(ii) does not meet the State's 
                        affordability criteria if the recipient--
                                    ``(I) seeks additional 
                                subsidization to benefit individual 
                                ratepayers in the residential user rate 
                                class;
                                    ``(II) demonstrates to the State 
                                that such ratepayers will experience a 
                                significant hardship from the increase 
                                in rates necessary to finance the 
                                project or activity for which 
                                assistance is sought; and
                                    ``(III) ensures, as part of an 
                                assistance agreement between the State 
                                and the recipient, that the additional 
                                subsidization provided under this 
                                paragraph is directed through a user 
                                charge rate system (or other 
                                appropriate method) to such ratepayers; 
                                or
                    ``(B) to implement a process, material, technique, 
                or technology to address water-efficiency goals, 
                address energy-efficiency goals, mitigate stormwater 
                runoff, or encourage environmentally sensitive project 
                planning, design, and construction.
            ``(2) Affordability criteria.--
                    ``(A) Establishment.--On or before September 30, 
                2012, and after providing notice and an opportunity for 
                public comment, a State shall establish affordability 
                criteria to assist in identifying municipalities that 
                would experience a significant hardship raising the 
                revenue necessary to finance a project or activity 
                eligible for assistance under section 603(c)(1) if 
                additional subsidization is not provided. Such criteria 
                shall be based on income data, population trends, and 
                other data determined relevant by the State, including 
                whether the project or activity is to be carried out in 
                an economically distressed area, as described in 
                section 301 of the Public Works and Economic 
                Development Act of 1965 (42 U.S.C. 3161).
                    ``(B) Existing criteria.--If a State has previously 
                established, after providing notice and an opportunity 
                for public comment, affordability criteria that meet 
                the requirements of subparagraph (A), the State may use 
                the criteria for the purposes of this subsection. For 
                purposes of this Act, any such criteria shall be 
                treated as affordability criteria established under 
                this paragraph.
                    ``(C) Information to assist states.--The 
                Administrator may publish information to assist States 
                in establishing affordability criteria under 
                subparagraph (A).
            ``(3) Priority.--A State may give priority to a recipient 
        for a project or activity eligible for funding under section 
        603(c)(1) if the recipient meets the State's affordability 
        criteria.
            ``(4) Set-aside.--
                    ``(A) In general.--In any fiscal year in which the 
                Administrator has available for obligation more than 
                $1,000,000,000 for the purposes of this title, a State 
                shall provide additional subsidization under this 
                subsection in the amount specified in subparagraph (B) 
                to eligible entities described in paragraph (1) for 
                projects and activities identified in the State's 
                intended use plan prepared under section 606(c) to the 
                extent that there are sufficient applications for such 
                assistance.
                    ``(B) Amount.--In a fiscal year described in 
                subparagraph (A), a State shall set aside for purposes 
                of subparagraph (A) an amount not less than 25 percent 
                of the difference between--
                            ``(i) the total amount that would have been 
                        allotted to the State under section 604 for 
                        such fiscal year if the amount available to the 
                        Administrator for obligation under this title 
                        for such fiscal year had been equal to 
                        $1,000,000,000; and
                            ``(ii) the total amount allotted to the 
                        State under section 604 for such fiscal year.
            ``(5) Limitation.--The total amount of additional 
        subsidization provided under this subsection by a State may not 
        exceed 30 percent of the total amount of capitalization grants 
        received by the State under this title in fiscal years 
        beginning after September 30, 2011.''.

SEC. 1304. ALLOTMENT OF FUNDS.

    (a) In General.--Section 604(a) (33 U.S.C. 1384(a)) is amended to 
read as follows:
    ``(a) Allotments.--
            ``(1) Fiscal years 2012 and 2013.--Sums appropriated to 
        carry out this title for each of fiscal years 2012 and 2013 
        shall be allotted by the Administrator in accordance with the 
        formula used to allot sums appropriated to carry out this title 
        for fiscal year 2011.
            ``(2) Fiscal year 2014 and thereafter.--Sums appropriated 
        to carry out this title for fiscal year 2014 and each fiscal 
        year thereafter shall be allotted by the Administrator as 
        follows:
                    ``(A) Amounts that do not exceed $1,350,000,000 
                shall be allotted in accordance with the formula 
                described in paragraph (1).
                    ``(B) Amounts that exceed $1,350,000,000 shall be 
                allotted in accordance with the formula developed by 
                the Administrator under subsection (d).''.
    (b) Planning Assistance.--Section 604(b) (33 U.S.C. 1384(b)) is 
amended by striking ``1 percent'' and inserting ``2 percent''.
    (c) Formula.--Section 604 (33 U.S.C. 1384) is amended by adding at 
the end the following:
    ``(d) Formula Based on Water Quality Needs.--Not later than 
September 30, 2013, and after providing notice and an opportunity for 
public comment, the Administrator shall publish an allotment formula 
based on water quality needs in accordance with the most recent survey 
of needs developed by the Administrator under section 516(b) and any 
other information the Administrator considers appropriate.''.

SEC. 1305. INTENDED USE PLAN.

    (a) Integrated Priority List.--Section 603(g) (33 U.S.C. 1383(g)) 
is amended to read as follows:
    ``(g) Priority List.--
            ``(1) In general.--For fiscal year 2013 and each fiscal 
        year thereafter, a State shall establish or update a list of 
        projects and activities for which assistance is sought from the 
        State's water pollution control revolving fund. Such projects 
        and activities shall be listed in priority order based on the 
        methodology established under paragraph (2). The State may 
        provide financial assistance from the State's water pollution 
        control revolving fund only with respect to a project or 
        activity included on such list. In the case of projects and 
        activities eligible for assistance under section 603(c)(2), the 
        State may include a category or subcategory of nonpoint sources 
        of pollution on such list in lieu of a specific project or 
        activity.
            ``(2) Methodology.--
                    ``(A) In general.--Not later than 1 year after the 
                date of enactment of this paragraph, and after 
                providing notice and opportunity for public comment, 
                each State (acting through the State's water quality 
                management agency and other appropriate agencies of the 
                State) shall establish a methodology for developing a 
                priority list under paragraph (1).
                    ``(B) Priority for projects and activities that 
                achieve greatest water quality improvement.--In 
                developing the methodology, the State shall seek to 
                achieve the greatest degree of water quality 
                improvement, taking into consideration the requirements 
                of section 602(b)(5) and section 603(i)(3), whether 
                such water quality improvements would be realized 
                without assistance under this title, and whether the 
                proposed projects and activities would address water 
                quality impairments associated with existing treatment 
                works.
                    ``(C) Considerations in selecting projects and 
                activities.--In determining which projects and 
                activities will achieve the greatest degree of water 
                quality improvement, the State shall consider--
                            ``(i) information developed by the State 
                        under sections 303(d) and 305(b);
                            ``(ii) the State's continuing planning 
                        process developed under section 303(e);
                            ``(iii) the State's management program 
                        developed under section 319; and
                            ``(iv) conservation and management plans 
                        developed under section 320.
                    ``(D) Nonpoint sources.--For categories or 
                subcategories of nonpoint sources of pollution that a 
                State may include on its priority list under paragraph 
                (1), the State shall consider the cumulative water 
                quality improvements associated with projects or 
                activities in such categories or subcategories.
                    ``(E) Existing methodologies.--If a State has 
                previously developed, after providing notice and an 
                opportunity for public comment, a methodology that 
                meets the requirements of this paragraph, the State may 
                use the methodology for the purposes of this 
                subsection.''.
    (b) Intended Use Plan.--Section 606(c) (33 U.S.C. 1386(c)) is 
amended--
            (1) in the matter preceding paragraph (1) by striking 
        ``each State shall annually prepare'' and inserting ``each 
        State (acting through the State's water quality management 
        agency and other appropriate agencies of the State) shall 
        annually prepare and publish'';
            (2) by striking paragraph (1) and inserting the following:
            ``(1) the State's priority list developed under section 
        603(g);'';
            (3) in paragraph (4)--
                    (A) by striking ``and (6)'' and inserting ``(6), 
                (15), and (17)''; and
                    (B) by striking ``and'' at the end;
            (4) by striking the period at the end of paragraph (5) and 
        inserting ``; and''; and
            (5) by adding at the end the following:
            ``(6) if the State does not fund projects and activities in 
        the order of the priority established under section 603(g), an 
        explanation of why such a change in order is appropriate.''.
    (c) Transitional Provision.--Before completion of a priority list 
based on a methodology established under section 603(g) of the Federal 
Water Pollution Control Act (as amended by this section), a State shall 
continue to comply with the requirements of sections 603(g) and 606(c) 
of such Act, as in effect on the day before the date of enactment of 
this Act.

SEC. 1306. ANNUAL REPORTS.

    Section 606(d) (33 U.S.C. 1386(d)) is amended--
            (1) by striking ``(d) Annual Report.--Beginning'' and 
        inserting the following:
    ``(d) Annual Reports.--
            ``(1) State report.--Beginning'';
            (2) in paragraph (1) (as so designated) by striking ``loan 
        amounts,'' and inserting ``loan amounts, the eligible purposes 
        under section 603(c) for which the assistance has been 
        provided,''; and
            (3) by adding at the end the following:
            ``(2) Federal report.--The Administrator shall annually 
        prepare, and make publicly available, a report on the 
        performance of the projects and activities carried out in whole 
        or in part with assistance made available by a State water 
        pollution control revolving fund as authorized under this title 
        during the previous fiscal year, including--
                    ``(A) the annual and cumulative financial 
                assistance provided to States under this title;
                    ``(B) the categories and types of such projects and 
                activities;
                    ``(C) an estimate of the number of jobs created 
                through carrying out such projects and activities;
                    ``(D) an assessment of the progress made toward 
                meeting the goals and purposes of this Act through such 
                projects and activities; and
                    ``(E) any additional information that the 
                Administrator considers appropriate.''.

SEC. 1307. TECHNICAL ASSISTANCE; REQUIREMENTS FOR USE OF AMERICAN 
              MATERIALS.

    Title VI (33 U.S.C. 1381 et seq.) is amended--
            (1) by redesignating section 607 as section 610; and
            (2) by inserting after section 606 the following:

``SEC. 607. TECHNICAL ASSISTANCE.

    ``(a) Simplified Procedures.--Not later than 1 year after the date 
of enactment of this section, the Administrator shall assist the States 
in establishing simplified procedures for treatment works to obtain 
assistance under this title.
    ``(b) Publication of Manual.--Not later than 2 years after the date 
of the enactment of this section, and after providing notice and 
opportunity for public comment, the Administrator shall publish a 
manual to assist treatment works in obtaining assistance under this 
title and publish in the Federal Register notice of the availability of 
the manual.
    ``(c) Compliance Criteria.--At the request of any State, the 
Administrator, after providing notice and an opportunity for public 
comment, shall assist in the development of criteria for a State to 
determine compliance with the conditions of funding assistance 
established under sections 602(b)(13) and 603(d)(1)(E).

``SEC. 608. BUY AMERICA.

    ``(a) In General.--Notwithstanding any other provision of law, 
funds made available from a State water pollution control revolving 
fund established under this title may not be used for a project for the 
construction of a publicly owned treatment works unless the steel, 
iron, and manufactured goods used for the project are produced in the 
United States.
    ``(b) Exceptions.--Subsection (a) shall not apply to a project for 
the construction of a treatment works if the Administrator (in 
consultation with the Governor of the State in which the treatment 
works will be constructed) makes a finding that--
            ``(1) the steel, iron, or manufactured goods required for 
        the project are a de minimis component of the project, as 
        determined in accordance with regulations to be issued by the 
        Administrator;
            ``(2) the steel, iron, or manufactured goods required for 
        the project are not produced in the United States--
                    ``(A) in sufficient and reasonably available 
                quantities; or
                    ``(B) to a satisfactory quality; or
            ``(3) the use of steel, iron, and manufactured goods 
        produced in the United States for the project will increase the 
        total cost of the project by more than 25 percent.
    ``(c) Waiver Requirements.--
            ``(1) Public notification and opportunity for comment.--
                    ``(A) In general.--At least 30 days before making a 
                finding under subsection (b), the Administrator shall 
                provide notice of and an opportunity for public comment 
                on the finding.
                    ``(B) Notice requirements.--Any notice provided 
                under this subparagraph shall--
                            ``(i) include a justification for the 
                        proposed finding; and
                            ``(ii) be provided by electronic means, 
                        including on the Internet.
            ``(2) Detailed justification in federal register.--If the 
        Administrator makes a finding under subsection (b), the 
        Administrator shall--
                    ``(A) publish in the Federal Register a detailed 
                justification for the finding; and
                    ``(B) provide notice of and an opportunity for 
                public comment on the detailed justification at least 
                30 days before the finding takes effect.
            ``(3) Annual report.--Not later than February 1 of each 
        year beginning after the date of enactment of this section, the 
        Administrator shall submit to the Committee on Transportation 
        and Infrastructure of the House of Representatives and the 
        Committee on Environment and Public Works of the Senate a 
        report that--
                    ``(A) specifies each project with respect to which 
                the Administrator made a finding under subsection (b) 
                during the preceding calendar year; and
                    ``(B) describes the justification for each such 
                finding.
    ``(d) State Requirements.--The Administrator may not impose a 
limitation or condition on assistance provided under this title that 
restricts--
            ``(1) a State from imposing requirements that are more 
        stringent than those imposed under this section with respect to 
        limiting the use of articles, materials, or supplies mined, 
        produced, or manufactured in foreign countries for projects 
        carried out with such assistance; or
            ``(2) any recipient of assistance from a State water 
        pollution control revolving fund established under this title 
        from complying with such State requirements.
    ``(e) Intentional Violations.--Pursuant to procedures established 
under subpart 9.4 of chapter 1 of title 48, Code of Federal 
Regulations, a person shall be ineligible to receive a contract or 
subcontract funded with amounts made available from a State water 
pollution control revolving fund established under this title if the 
Administrator or a court determines that such person intentionally--
            ``(1) affixed a label bearing a `Made in America' 
        inscription, or any inscription with the same meaning, to any 
        steel, iron, or manufactured goods that--
                    ``(A) were used in a project to which this section 
                applies; and
                    ``(B) were not produced in the United States; or
            ``(2) represented that any steel, iron, or manufactured 
        goods were produced in the United States that--
                    ``(A) were used in projects to which this section 
                applies; and
                    ``(B) were not produced in the United States.
    ``(f) Consistency With International Agreements.--
            ``(1) In general.--This section shall be applied in a 
        manner that is consistent with United States obligations under 
        international agreements.
            ``(2) Treatment of foreign countries in violation of 
        international agreements.--The Administrator shall prohibit the 
        use of steel, iron, and manufactured goods produced in a 
        foreign country in a project funded with amounts made available 
        from a State water pollution control revolving fund established 
        under this title, including any project for which the 
        Administrator has made a finding under subsection (b), if the 
        Administrator, in consultation with the United States Trade 
        Representative, determines that the foreign country is in 
        violation of the terms of an agreement with the United States 
        by discriminating against steel, iron, or manufactured goods 
        that are produced in the United States and covered by the 
        agreement.''.

SEC. 1308. ECONOMIC HARDSHIP WAIVER.

    Notwithstanding the requirements of section 602(b)(2) of the 
Federal Water Pollution Control Act (33 U.S.C. 1382(b)(2)), for fiscal 
years 2012 and 2013, the Administrator of the Environmental Protection 
Agency may waive the requirement that a State deposit an amount equal 
to 20 percent of the State's annual capitalization grant into the 
State's water pollution control revolving fund established under title 
VI of that Act if the Administrator determines that the State is 
currently experiencing a local, statewide, or regional economic 
hardship and that providing such a deposit would adversely impact the 
State's ability to restore and maintain the chemical, physical, and 
biological integrity of waters located within the State.

SEC. 1309. AUTHORIZATION OF APPROPRIATIONS.

    Section 610 (as redesignated by section 1307 of this Act) is 
amended by striking paragraphs (1) through (5) and inserting the 
following:
            ``(1) $2,400,000,000 for fiscal year 2012;
            ``(2) $2,700,000,000 for fiscal year 2013;
            ``(3) $2,800,000,000 for fiscal year 2014;
            ``(4) $2,900,000,000 for fiscal year 2015; and
            ``(5) $3,000,000,000 for fiscal year 2016.''.

                     Subtitle D--General Provisions

SEC. 1401. DEFINITION OF TREATMENT WORKS.

    Section 502 (33 U.S.C. 1362) is amended by adding at the end the 
following:
            ``(26) Treatment works.--The term `treatment works' has the 
        meaning given that term in section 212.''.

SEC. 1402. FUNDING FOR INDIAN PROGRAMS.

    Section 518(c) (33 U.S.C. 1377) is amended--
            (1) by striking ``The Administrator'' and inserting the 
        following:
            ``(1) Fiscal years 1987-2011.--The Administrator'';
            (2) in paragraph (1) (as so designated)--
                    (A) by inserting ``and ending before October 1, 
                2011,'' after ``1986,''; and
                    (B) by striking the second sentence; and
            (3) by adding at the end the following:
            ``(2) Fiscal year 2012 and thereafter.--For fiscal year 
        2012 and each fiscal year thereafter, the Administrator shall 
        reserve, before allotments to the States under section 604(a), 
        not less than 0.5 percent and not more than 2.0 percent of the 
        funds made available to carry out title VI.
            ``(3) Use of funds.--Funds reserved under this subsection 
        shall be available only for grants for projects and activities 
        eligible for assistance under section 603(c) to serve--
                    ``(A) Indian tribes (as defined in section 518(h));
                    ``(B) former Indian reservations in Oklahoma (as 
                determined by the Secretary of the Interior); and
                    ``(C) Native villages (as defined in section 3 of 
                the Alaska Native Claims Settlement Act (43 U.S.C. 
                1602)).''.

                       Subtitle E--Tonnage Duties

SEC. 1501. TONNAGE DUTIES.

    (a) In General.--Section 60301 of title 46, United States Code, is 
amended by striking subsections (a) and (b) and inserting the 
following:
    ``(a) Lower Rate.--
            ``(1) Imposition of duty.--A duty is imposed at the rate 
        described in paragraph (2) at each entry in a port of the 
        United States of--
                    ``(A) a vessel entering from a foreign port or 
                place in North America, Central America, the West 
                Indies Islands, the Bahama Islands, the Bermuda 
                Islands, or the coast of South America bordering the 
                Caribbean Sea; or
                    ``(B) a vessel returning to the same port or place 
                in the United States from which it departed, and not 
                entering the United States from another port or place, 
                except--
                            ``(i) a vessel of the United States;
                            ``(ii) a recreational vessel (as defined in 
                        section 2101 of this title); or
                            ``(iii) a barge.
            ``(2) Rate.--The rate referred to in paragraph (1) shall 
        be--
                    ``(A) 4.5 cents per ton (but not more than a total 
                of 22.5 cents per ton per year) for fiscal years 2006 
                through 2011;
                    ``(B) 9.0 cents per ton (but not more than a total 
                of 45 cents per ton per year) for fiscal years 2012 
                through 2021; and
                    ``(C) 2 cents per ton (but not more than a total of 
                10 cents per ton per year) for each fiscal year 
                thereafter.
    ``(b) Higher Rate.--
            ``(1) Imposition of duty.--A duty is imposed at the rate 
        described in paragraph (2) on a vessel at each entry in a port 
        of the United States from a foreign port or place not named in 
        subsection (a)(1).
            ``(2) Rate.--The rate referred to in paragraph (1) shall 
        be--
                    ``(A) 13.5 cents per ton (but not more than a total 
                of 67.5 cents per ton per year) for fiscal years 2006 
                through 2011;
                    ``(B) 27 cents per ton (but not more than a total 
                of $1.35 per ton per year) for fiscal years 2012 
                through 2021, and
                    ``(C) 6 cents per ton (but not more than a total of 
                30 cents per ton per year) for each fiscal year 
                thereafter.''.
    (b) Conforming Amendments.--Such title is further amended--
            (1) by striking the heading for subtitle VI and inserting 
        the following:

             ``Subtitle VI--Clearance and Tonnage Duties'';

            (2) in the heading for chapter 603, by striking ``TAXES'' 
        and inserting ``DUTIES'';
            (3) in the headings of sections in chapter 603, by striking 
        ``taxes'' each place it appears and inserting ``duties'';
            (4) in the heading for subsection (a) of section 60303, by 
        striking ``Tax'' and inserting ``Duty'';
            (5) in the text of sections in chapter 603, by striking 
        ``taxes'' each place it appears and inserting ``duties''; and
            (6) in the text of sections in chapter 603, by striking 
        ``tax'' each place it appears and inserting ``duty''.
    (c) Clerical Amendments.--Such title is further amended--
            (1) in the title analysis by striking the item relating to 
        subtitle VI and inserting the following:

``VI. CLEARANCE AND TONNAGE DUTIES..........................   60101'';
            (2) in the analysis for subtitle VI by striking the item 
        relating to chapter 603 and inserting the following:

``603. Tonnage Duties and Light Money.......................   60301'';
        and
            (3) in the analysis for chapter 603--
                    (A) by striking the items relating to sections 
                60301 and 60302 and inserting the following:

``60301. Regular tonnage duties.
``60302. Special tonnage duties.'';
                and
                    (B) by striking the item relating to section 60304 
                and inserting the following:

``60304. Presidential suspension of tonnage duties and light money.''.

              TITLE II--ALTERNATIVE WATER SOURCE PROJECTS

SEC. 2001. PILOT PROGRAM FOR ALTERNATIVE WATER SOURCE PROJECTS.

    (a) Selection of Projects.--Section 220(d)(2) (33 U.S.C. 
1300(d)(2)) is amended by inserting before the period at the end the 
following: ``or whether the project is located in an area which is 
served by a public water system serving 10,000 individuals or fewer''.
    (b) Authorization of Appropriations.--Section 220(j) (33 U.S.C. 
1300(j)) is amended by striking ``$75,000,000 for fiscal years 2002 
through 2004'' and inserting ``$50,000,000 for each of fiscal years 
2012 through 2016''.

                TITLE III--SEWER OVERFLOW CONTROL GRANTS

SEC. 3001. SEWER OVERFLOW CONTROL GRANTS.

    (a) Administrative Requirements.--Section 221(e) (33 U.S.C. 
1301(e)) is amended to read as follows:
    ``(e) Administrative Requirements.--A project that receives 
assistance under this section shall be carried out subject to the same 
requirements as a project that receives assistance from a State water 
pollution control revolving fund under title VI, except to the extent 
that the Governor of the State in which the project is located 
determines that a requirement of title VI is inconsistent with the 
purposes of this section. For the purposes of this subsection, a 
Governor may not determine that the requirements of title VI relating 
to the application of section 513 are inconsistent with the purposes of 
this section.''.
    (b) Authorization of Appropriations.--Section 221(f) (33 U.S.C. 
1301(f)) is amended to read as follows:
    ``(f) Authorization of Appropriations.--
            ``(1) In general.--There is authorized to be appropriated 
        to carry out this section $500,000,000 for each of fiscal years 
        2012 through 2016.
            ``(2) Minimum allocations.--To the extent there are 
        sufficient eligible project applications, the Administrator 
        shall ensure that a State uses not less than 20 percent of the 
        amount of the grants made to the State under subsection (a) in 
        a fiscal year to carry out projects to control municipal 
        combined sewer overflows and sanitary sewer overflows through 
        the use of green infrastructure, water and energy efficiency 
        improvements, and other environmentally innovative 
        activities.''.
    (c) Allocation of Funds.--Section 221(g) of such Act (33 U.S.C. 
1301(g)) is amended to read as follows:
    ``(g) Allocation of Funds.--
            ``(1) Fiscal year 2012.--Subject to subsection (h), the 
        Administrator shall use the amounts appropriated to carry out 
        this section for fiscal year 2012 for making grants to 
        municipalities and municipal entities under subsection (a)(2) 
        in accordance with the criteria set forth in subsection (b).
            ``(2) Fiscal year 2013 and thereafter.--Subject to 
        subsection (h), the Administrator shall use the amounts 
        appropriated to carry out this section for fiscal year 2013 and 
        each fiscal year thereafter for making grants to States under 
        subsection (a)(1) in accordance with a formula to be 
        established by the Administrator, after providing notice and an 
        opportunity for public comment, that allocates to each State a 
        proportional share of such amounts based on the total needs of 
        the State for municipal combined sewer overflow controls and 
        sanitary sewer overflow controls identified in the most recent 
        survey conducted pursuant to section 516 and any other 
        information the Administrator considers appropriate.''.
    (d) Reports.--The first sentence of section 221(i) (33 U.S.C. 
1301(i)) is amended by striking ``2003'' and inserting ``2013''.

                    TITLE IV--CLEAN WATER TRUST FUND

SEC. 4001. ESTABLISHMENT OF CLEAN WATER TRUST FUND.

    Subchapter A of chapter 98 of the Internal Revenue Code of 1986 
(relating to the establishment of trust funds) is amended by adding at 
the end the following new section:

``SEC. 9512. CLEAN WATER TRUST FUND.

    ``(a) Creation of Trust Fund.--There is established in the Treasury 
of the United States a trust fund to be known as the `Clean Water Trust 
Fund', consisting of such amounts as may be appropriated or credited to 
the Fund as provided in this section or section 9602(b).
    ``(b) Transfers to Trust Fund.--There are hereby appropriated to 
the Clean Water Trust Fund amounts equivalent to--
            ``(1) fees, taxes, or other sources of revenue specifically 
        collected and deposited in the Fund or received in the Treasury 
        for the purposes provided in this section; and
            ``(2) any penalty paid pursuant to section 309 of the 
        Federal Water Pollution Control Act (33 U.S.C. 1319) (other 
        than those that result of violations of section 311 of such 
        Act).
    ``(c) Appropriation of Additional Sums.--There are hereby 
authorized to be appropriated to the Clean Water Trust Fund such 
additional sums as may be required to make the expenditures referred to 
in subsection (d).
    ``(d) Expenditures.--Amounts in the Clean Water Trust Fund shall be 
available, as provided in appropriations Acts, for the following 
purposes:
            ``(1) Capitalization grants under section 601 of the 
        Federal Water Pollution Control Act (33 U.S.C. 1381).
            ``(2) Grants to States and interstate agencies under 
        section 106(a) of that Act (33 U.S.C. 1256(a)).
            ``(3) Grants under sections 104(b) and 104(g) of that Act 
        (33 U.S.C. 1254(b) and 1254(g)).
            ``(4) To cover the cost of making direct loans or 
        guaranteeing obligations authorized under the Water Pollution 
        Control Investment Act.''.

SEC. 4002. ALLOCATION OF FUNDS.

    Title VI (as amended by section 1307 of this Act) is further 
amended by inserting after section 608 the following:

``SEC. 609. CLEAN WATER TRUST FUND.

    ``(a) Allocation of Funds.--The Administrator shall allocate funds 
made available for a fiscal year out of the Clean Water Trust Fund 
established by section 9512 of the Internal Revenue Code of 1986 among 
eligible programs and activities as follows:
            ``(1) 80 percent for capitalization grants under section 
        604.
            ``(2) 10 percent to cover the cost of making direct loans 
        or guaranteeing obligations authorized under the Water 
        Pollution Control Investment Act.
            ``(3) 7.5 percent for grants to States and interstate 
        agencies under section 106(a).
            ``(4) 2.5 percent for grants under sections 104(b) and 
        104(g).
    ``(b) Amounts Made Available for Capitalization Grants.--To the 
extent there are sufficient applications, not less than 30 percent of 
the amounts allocated for capitalization grants under subsection (a)(1) 
shall be used for one or more of the following purposes:
            ``(1) Projects or activities to address green 
        infrastructure.
            ``(2) Water or energy efficiency improvements or other 
        environmentally innovative activities.
            ``(3) The implementation of best management practices or 
        measures identified in an approved nonpoint source management 
        program under section 319.''.

SEC. 4003. REVENUES FOR CLEAN WATER TRUST FUND.

    (a) Study on Identification of Revenues.--Not later than 45 days 
after the date of enactment of this Act, the Director of the 
Congressional Budget Office, in consultation with the Administrator of 
the Environmental Protection Agency and the Secretary of the Treasury, 
shall undertake a study of potential funding mechanisms and revenue 
sources for the Clean Water Trust Fund established by section 9512(d) 
of the Internal Revenue Code of 1986 (as added by this Act) that are 
sufficient to support annual funding levels of at least $10,000,000,000 
for the purposes identified in section 9512(d) of that Act.
    (b) Conduct of Study.--In carrying out the study, the Director 
shall--
            (1) take into consideration whether potential funding 
        mechanisms and revenue sources--
                    (A) are broad based;
                    (B) are equitably allocated; and
                    (C) can be efficiently collected;
            (2) review and, to the extent practicable, utilize existing 
        studies and reports on potential sources of revenue for a clean 
        water trust fund, including--
                    (A) the report of the Government Accountability 
                Office entitled ``Clean Water Infrastructure: A Variety 
                of Issues Need to Be Considered When Designing a Clean 
                Water Trust Fund'' (GAO-09-037, May 2009); and
                    (B) the report of the Environmental Protection 
                Agency entitled ``Alternative Funding Study: Water 
                Quality Fees and Debt Financing Issues'' (EPA 832-R-96-
                001, June 1996);
            (3) consult with Federal, State, tribal, and local 
        agencies, representatives of business and industry, 
        representatives of entities operating publicly owned treatment 
        works, representatives of conservation and environmental 
        organizations, representatives of ratepayer organizations, and 
        other interested persons; and
            (4) provide the opportunity for public hearings.
    (c) Report to Congress.--Not later than 1 year after the date of 
enactment of this Act, the Director shall submit a report on the 
results of the study to--
            (1) the Committee on Transportation and Infrastructure, the 
        Committee on Ways and Means, and the Committee on the Budget of 
        the House of Representatives; and
            (2) the Committee on Environment and Public Works, the 
        Committee on Finance, and the Committee on the Budget of the 
        Senate.

              TITLE V--WATER POLLUTION CONTROL INVESTMENT

SEC. 5001. SHORT TITLE.

    This title may be cited as the ``Water Pollution Control Investment 
Act''.

SEC. 5002. DEFINITIONS.

    In this title, the following definitions apply:
            (1) Administrator.--The term ``Administrator'' means the 
        Administrator of the Environmental Protection Agency.
            (2) Borrower.--The term ``borrower'' means a person who 
        owes payments of interest or principal on an obligation 
        guaranteed under this title.
            (3) Cost of a direct loan.--The term ``cost of a direct 
        loan'' means the ``cost of a direct loan'' as that term is used 
        in section 502(5) of the Federal Credit Reform Act of 1990 (2 
        U.S.C. 661a(5)).
            (4) Cost of a guarantee.--The term ``cost of a guarantee'' 
        means the ``cost of a loan guarantee'' as that term is used in 
        section 502(5) of the Federal Credit Reform Act of 1990 (2 
        U.S.C. 661a(5)).
            (5) Direct loan.--The term ``direct loan'' has the meaning 
        given that term in section 502 of the Federal Credit Reform Act 
        of 1990 (2 U.S.C. 661a).
            (6) Guarantee.--
                    (A) In general.--The term ``guarantee'' has the 
                meaning given the term ``loan guarantee'' in section 
                502 of the Federal Credit Reform Act of 1990 (2 U.S.C. 
                661a).
                    (B) Inclusion.--The term ``guarantee'' includes a 
                loan guarantee commitment (as that term is defined in 
                section 502 of the Federal Credit Reform Act of 1990 (2 
                U.S.C. 661a)).
            (7) Large water infrastructure project.--
                    (A) In general.--The term ``large water 
                infrastructure project'' means a project for 
                construction of a publicly owned treatment works that 
                qualifies for assistance under section 603(c) of the 
                Federal Water Pollution Control Act (33 U.S.C. 
                1383(c)), but because of its significant scope and cost 
                is not likely to receive assistance under that Act, as 
                determined by the Administrator.
                    (B) Guidelines.--The Administrator shall issue 
                guidelines for determining whether a project qualifies 
                as a large water infrastructure project.
            (8) Obligation.--The term ``obligation'' means a loan or 
        other debt obligation.
            (9) State infrastructure financing authority.--The term 
        ``State infrastructure financing authority'' means the State 
        entity established or designated by the Governor of a State to 
        receive a capitalization grant provided by, or otherwise carry 
        out the requirements of, title VI of the Federal Water 
        Pollution Control Act (33 U.S.C. 1381 et. seq.).

SEC. 5003. DIRECT LOANS.

    (a) In General.--
            (1) Use of loans.--The Administrator may make a direct loan 
        to a State infrastructure financing authority for use in the 
        same manner, and subject to the same terms and conditions 
        (unless otherwise specified in this section), as a 
        capitalization grant made under section 601 of the Federal 
        Water Pollution Control Act (33 U.S.C. 1831).
            (2) Terms and conditions.--The Administrator may make a 
        loan under this section on such terms and conditions (including 
        requirements for audits) as the Administrator determines 
        appropriate.
    (b) Loan Requirements.--
            (1) Maximum amount.--The amount of a loan made under this 
        section to a State infrastructure financing authority shall not 
        exceed the applicable percentage for the State establishing 
        such authority of the total amount available under this title 
        for disbursement, based on the allotment for the State in 
        accordance with section 604 of the Federal Water Pollution 
        Control Act (33 U.S.C. 1384).
            (2) Term of loan.--The final maturity date of a loan made 
        under this section shall not be later than 35 years after the 
        date on which funds are disbursed to a State infrastructure 
        financing authority.
            (3) Interest rate.--The Administrator may make a loan under 
        this section only if the Administrator determines that the 
        interest rate on the loan is appropriate, taking into account 
        the prevailing rate of interest in the private sector for 
        similar loans.
            (4) Security.--The Administrator shall require a State 
        infrastructure financing authority receiving a loan under this 
        section to use a rate covenant, coverage requirement, or 
        similar security feature adequate to ensure loan repayment.
            (5) Repayment.--
                    (A) Schedule.--The Administrator shall set a 
                repayment schedule for each loan made under this 
                section based on the projected cash flow to the State 
                infrastructure financing authority, including 
                consideration of the effect on such cash flow of the 
                security features described in paragraph (4).
                    (B) Commencement.--Scheduled loan repayments of 
                principal or interest on a loan made under this section 
                shall commence not later than 5 years after the date on 
                which the loan is made.
                    (C) Deferral of payments.--
                            (i) In general.--If the Administrator 
                        determines that a State infrastructure 
                        financing authority lacks the resources to make 
                        scheduled payments on a loan made under this 
                        section based on circumstances not foreseeable 
                        at the time the loan is made, the Administrator 
                        may allow for the deferral of such payments.
                            (ii) Interest.--Any payment deferred under 
                        clause (i) shall--
                                    (I) continue to accrue interest 
                                until fully repaid; and
                                    (II) be amortized over the 
                                remaining term of the loan.
                    (D) Prepayment.--Payments on the loan may be made 
                in advance with no penalty.
    (c) Sale of Loans.--After notifying the State infrastructure 
financing authority, the Administrator, in consultation with the 
Secretary of the Treasury, may sell a loan made under this section, if 
the Administrator determines that the sale can be made on favorable 
terms.
    (d) Conforming Requirements.--The requirements of sections 211, 
511(c)(1), and 513 of the Federal Water Pollution Control Act (33 
U.S.C. 1291, 1371(c)(2), and 1372) apply to the construction of a 
project carried out in whole or in part with assistance made available 
through a loan under this section in the same manner as treatment works 
for which grants are made available under the Federal Water Pollution 
Control Act.
    (e) Fees.--The Administrator shall charge and collect fees from 
State infrastructure financing authorities receiving loans under this 
section in amounts the Administrator determines are sufficient to cover 
the administrative expenses associated with carrying out this section 
and, as provided in advance in appropriations Acts, use such amounts to 
cover such expenses.
    (f) Records; Audits.--
            (1) In general.--A State infrastructure financing authority 
        receiving a loan under this section shall keep such records and 
        other pertinent documents as the Administrator shall prescribe 
        by regulation, including such records as the Administrator may 
        require to facilitate an effective audit of loans made under 
        this section.
            (2) Access.--The Administrator and the Comptroller General 
        of the United States, or their duly authorized representatives, 
        shall have access, for the purpose of audits, to records and 
        other pertinent documents kept under paragraph (1).

SEC. 5004. GUARANTEES.

    (a) In General.--
            (1) Use of guarantees.--The Administrator may make a 
        guarantee under this title for an obligation for construction 
        of a large water infrastructure project in accordance with the 
        requirements of this section.
            (2) Selection criteria.--
                    (A) Establishment.--The Administrator shall 
                establish criteria for selecting among large water 
                infrastructure projects in making guarantees under this 
                title.
                    (B) Criteria.--In establishing selection criteria 
                under this paragraph, the Administrator shall include 
                consideration of the following:
                            (i) The extent to which the project is 
                        nationally or regionally significant.
                            (ii) The creditworthiness of the project, 
                        including a determination by the Administrator 
                        that any financing has appropriate features to 
                        ensure repayment.
                            (iii) The extent to which the project uses 
                        new technologies that enhance the environmental 
                        benefits of the project.
                            (iv) The cost of a guarantee under this 
                        title.
                            (v) The extent to which the project helps 
                        restore, maintain, or protect the environment.
            (3) Fiscal year limitation.--The Administrator may not 
        utilize more than 10 percent of the funds made available under 
        this title for a fiscal year to make guarantees under this 
        section during that fiscal year.
            (4) Terms and conditions.--The Administrator may make a 
        guarantee for a large water infrastructure project under this 
        title on such terms and conditions (including requirements for 
        audits) as the Administrator determines appropriate.
            (5) Security.--The Administrator shall require a borrower 
        to use a rate covenant, coverage requirement, or similar 
        security feature adequate to ensure repayment of the 
        obligation.
    (b) Guarantee Requirements.--
            (1) Probability of repayment.--The Administrator may make a 
        guarantee under this title only if the Administrator determines 
        that there is a high probability of repayment by the borrower 
        of the principal and interest on the obligation.
            (2) Amount.--
                    (A) Percentage of total cost.--The Administrator 
                may make a guarantee under this title only if the 
                amount of the obligation does not exceed 75 percent of 
                the total cost of the large water infrastructure 
                project, as estimated at the time at which the 
                guarantee is issued.
                    (B) Sufficiency.--The Administrator may make a 
                guarantee under this title only if the Administrator 
                determines that the amount of the obligation, when 
                combined with amounts available from other sources, 
                will be sufficient to carry out the project.
            (3) Nonsubordination.--The Administrator may make a 
        guarantee under this title only if the guarantee is not 
        subordinate to other financing.
            (4) Interest rate.--The Administrator may make a guarantee 
        under this title only if the Administrator determines that the 
        interest rate on the obligation is appropriate, taking into 
        account the prevailing rate of interest in the private sector 
        for similar obligations.
            (5) Term.--The Administrator may make a guarantee under 
        this title only if--
                    (A) repayment of the obligation is required over a 
                period not to exceed the lesser of--
                            (i) 35 years; or
                            (ii) 90 percent of the projected useful 
                        life of the large water infrastructure project 
                        to be financed by the obligation (as determined 
                        by the Administrator); and
                    (B) payments on the obligation are scheduled to 
                commence not later than 5 years after the date of 
                substantial completion of the large water 
                infrastructure project.
    (c) Conforming Requirements.--
            (1) Fiscal sustainability plan.--The Administrator may make 
        a guarantee for a large water infrastructure project under this 
        title only if the owner or operator of such project commits to 
        develop and implement a fiscal sustainability plan that meets 
        the requirements of section 603(d)(1)(E) of the Federal Water 
        Pollution Control Act, as added by this Act.
            (2) Priority list.--The Administrator may make a guarantee 
        for a large water infrastructure project under this title only 
        if such project is on a State priority list under section 
        603(g) of the Federal Water Pollution Control Act (33 U.S.C. 
        1383(g)), as amended by this Act.
            (3) Additional requirements.--The requirements of sections 
        211, 511(c)(1), and 513 of the Federal Water Pollution Control 
        Act (33 U.S.C. 1291, 1371(c)(2), and 1372) apply to the 
        construction of a large water infrastructure project carried 
        out in whole or in part with financing made available through 
        an obligation guaranteed under this title in the same manner as 
        treatment works for which grants are made available under the 
        Federal Water Pollution Control Act.
    (d) Defaults.--
            (1) Payment by administrator.--
                    (A) In general.--If a borrower defaults on an 
                obligation guaranteed under this title (as defined in 
                regulations promulgated by the Administrator and 
                specified in the guarantee contract), the holder of the 
                guarantee shall have the right to demand payment of the 
                unpaid amount from the Administrator.
                    (B) Payment required.--Within such period as may be 
                specified in the guarantee or related agreements, the 
                Administrator shall pay to the holder of a guarantee 
                the unpaid interest on, and unpaid principal of, the 
                obligation guaranteed under this title as to which the 
                borrower has defaulted, unless the Administrator finds 
                that there was no default by the borrower in the 
                payment of interest or principal or that the default 
                has been remedied.
                    (C) Forbearance.--Nothing in this subsection 
                precludes any forbearance by the holder of a guarantee 
                for the benefit of the borrower which may be agreed 
                upon by the parties to the obligation and approved by 
                the Administrator.
            (2) Subrogation.--
                    (A) In general.--If the Administrator makes a 
                payment under paragraph (1), the Administrator shall be 
                subrogated to the rights of the holder of the guarantee 
                as specified in the guarantee or related agreements.
                    (B) Superiority of rights.--The rights of the 
                Administrator, with respect to any property acquired 
                pursuant to a guarantee or related agreements, shall be 
                superior to the rights of any other person with respect 
                to the property.
    (e) Payment of Principal and Interest by Administrator.--
            (1) In general.--With respect to any obligation guaranteed 
        under this title, the Administrator may enter into a contract 
        to pay, and pay, a holder of the guarantee, for and on behalf 
        of the borrower, from funds appropriated for that purpose, the 
        principal and interest payments which become due and payable on 
        the unpaid balance of the obligation if the Administrator finds 
        that--
                    (A) the borrower is unable to meet the payments and 
                is not in default;
                    (B) it is in the public interest to permit the 
                borrower to continue to pursue the purposes of the 
                project;
                    (C) the probable net benefit to the Federal 
                Government in paying the principal and interest will be 
                greater than that which would result in the event of a 
                default; and
                    (D) the State or region in which the project is 
                located is experiencing a period of local or regional 
                economic hardship that has affected the borrower's 
                ability to meet the payments.
            (2) Amount.--The amount of the payment that the 
        Administrator is authorized to pay under this subsection shall 
        be no greater than the amount of principal and interest that 
        the borrower is obligated to pay under the obligation.
            (3) Reimbursement.--A payment may be made under this 
        subsection only if the borrower agrees to reimburse the 
        Administrator for the payment (including interest) on terms and 
        conditions that are satisfactory to the Administrator.
    (f) Fees.--The Administrator shall charge and collect fees from 
borrowers for guarantees made under this title in amounts the 
Administrator determines are sufficient to cover the administrative 
expenses associated with carrying out this title and, as provided in 
advance in appropriations Acts, use such amounts to cover such 
expenses.
    (g) Records; Audits.--
            (1) In general.--A borrower shall keep such records and 
        other pertinent documents as the Administrator shall prescribe 
        by regulation, including such records as the Administrator may 
        require to facilitate an effective audit of guarantees made 
        under this title.
            (2) Access.--The Administrator and the Comptroller General 
        of the United States, or their duly authorized representatives, 
        shall have access, for the purpose of audits, to records and 
        other pertinent documents kept under paragraph (1).
    (h) Full Faith and Credit.--The full faith and credit of the United 
States is pledged to the payment of all guarantees made under this 
title.

SEC. 5005. FUNDING.

    (a) Authorization of Appropriations.--There are authorized to be 
appropriated such sums as are necessary to provide direct loans and the 
costs of guarantees under this title.
    (b) Alternate Funding Mechanism.--With respect to a guarantee for a 
large water infrastructure project under this title, in lieu of funding 
such guarantee through a separate appropriation, the borrower of the 
obligation to be guaranteed may pay a one-time guarantee fee to the 
Administrator equal to the cost of the guarantee, and the Administrator 
may use such fee, as provided in advance in appropriations Acts, to 
make such guarantee.
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