In the Senate of the United States,
March 12, 2004.
Resolved, That the bill from the House of Representa-
tives (H.R. 254) entitled ‘‘An Act to authorize the President
of the United States to agree to certain amendments to the
Agreement between the Government of the United States of
America and the Government of the United Mexican States
concerning the establishment of a Border Environment Co-
operation Commission and a North American Development
Bank, and for other purposes.’’, do pass with the following
AMENDMENT:
Strike out all after the enacting clause and insert:
SECTION. 1. AUTHORITY TO AGREE TO CERTAIN AMEND-
MENTS TO THE BORDER ENVIRONMENT CO-
OPERATION AGREEMENT; GRANT AUTHORITY.
(a) AMENDMENT AUTHORITY.—Part 2 of subtitle D of
title V of Public Law 103–182 (22 U.S.C. 290m–290m-3)
is amended by adding at the end the following:
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‘‘SEC. 545. AUTHORITY TO AGREE TO CERTAIN AMEND-
MENTS TO THE BORDER ENVIRONMENT CO-
OPERATION AGREEMENT.
‘‘The President may agree to amendments to the Co-
operation Agreement that—
‘‘(1) enable the Bank to make grants and non-
market rate loans out of its paid-in capital resources
with the approval of its Board; and
‘‘(2) amend the definition of ‘border region’ to
include the area in the United States that is within
100 kilometers of the international boundary between
the United States and Mexico, and the area in Mexico
that is within 300 kilometers of the international
boundary between the United States and Mexico.’’.
(b) GRANT AUTHORITY.—Part 2 of subtitle D of title
V of Public Law 103–182 (22 U.S.C. 290m–290m–3), as
amended by subsection (a), is amended by adding at the
end the following:
‘‘SEC. 546. GRANTS OUT OF PAID-IN CAPITAL RESOURCES.
‘‘(a) IN GENERAL.—The President shall instruct the
United States Federal Government representatives on the
Board of Directors of the North American Development
Bank to oppose any proposal where grants out of the Bank’s
paid-in capital resources, except for grants from paid-in
capital authorized for the community adjustment and in-
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vestment program under the Bank’s charter of 1993,
would—
‘‘(1) be made to a project that is not being fi-
nanced, in part, by loans; or
‘‘(2) account for more than 50 percent of the fi-
nancing of any individual project.
‘‘(b) EXCEPTION.—
‘‘(1) GENERAL RULE.—The requirements of sub-
section (a) shall not apply in cases where—
‘‘(A) the President determines there are ex-
ceptional economic circumstances for making the
grant and consults with the Committee on For-
eign Relations of the Senate and the Committee
on Financial Services of the House of Represent-
atives; or
‘‘(B)(i) the grant is being made for a
project that is so small that obtaining a loan is
impractical; and
‘‘(ii) the grant does not exceed $250,000.
‘‘(2) LIMITATION.—Not more than an aggregate
of $5,000,000 in grants may be made under this sub-
section.’’.
(c) CLERICAL AMENDMENT.—Section 1(b) of such pub-
lic law is amended in the table of contents by inserting after
the item relating to section 544 the following:
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‘‘Sec. 545. Authority to agree to certain amendments to the Border Environment
Cooperation Agreement.
‘‘Sec. 546. Grants out of paid-in capital resources.’’.
SEC. 2. ANNUAL REPORT.
The Secretary of the Treasury shall submit annually
to the Committee on Financial Services of the House of Rep-
resentatives and the Committee on Foreign Relations of the
Senate a written report on the North American Develop-
ment Bank, which addresses the following issues:
(1) The number and description of the projects
that the North American Development Bank has ap-
proved. The description shall include the level of mar-
ket-rate loans, non-market-rate loans, and grants used
in an approved project, and a description of whether
an approved project is located within 100 kilometers
of the international boundary between the United
States and Mexico or within 300 kilometers of the
international boundary between the United States
and Mexico.
(2) The number and description of the approved
projects in which money has been dispersed.
(3) The number and description of the projects
which have been certified by the Border Environment
Cooperation Commission, but yet not financed by the
North American Development Bank, and the reasons
that the projects have not yet been financed.
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(4) The total of the paid-in capital, callable cap-
ital, and retained earnings of the North American
Development Bank, and the uses of such amounts.
(5) A description of any efforts and discussions
between the United States and Mexican governments
to expand the type of projects which the North Amer-
ican Development Bank finances beyond environ-
mental projects.
(6) A description of any efforts and discussions
between the United States and Mexican governments
to improve the effectiveness of the North American De-
velopment Bank.
(7) The number and description of projects au-
thorized under the Water Conservation Investment
Fund of the North American Development Bank.
SEC. 3. SENSE OF THE CONGRESS RELATING TO UNITED
STATES SUPPORT FOR NADBANK PROJECTS
WHICH FINANCE WATER CONSERVATION FOR
TEXAS 
IRRIGATORS 
AND 
AGRICULTURAL
PRODUCERS IN THE LOWER RIO GRANDE
RIVER VALLEY.
(a) FINDINGS.—The Congress finds that—
(1) Texas irrigators and agricultural producers
are suffering enormous hardships in the lower Rio
Grande River valley because of Mexico’s failure to
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abide by the 1944 Water Treaty entered into by the
United States and Mexico;
(2) over the last 10 years, Mexico has accumu-
lated a 1,500,000-acre fee water debt to the United
States which has resulted in a very minimal and in-
adequate irrigation water supply in Texas;
(3) recent studies by Texas A&M University
show that water savings of 30 percent or more can be
achieved by improvements in irrigation system infra-
structure such as canal lining and metering;
(4) on August 20, 2002, the Board of the North
American Development Bank agreed to the creation
in the Bank of a Water Conservation Investment
Fund, as required by Minute 308 to the 1944 Water
Treaty, which was an agreement signed by the United
States and Mexico on June 28, 2002; and
(5) the Water Conservation Investment Fund of
the North American Development Bank stated that up
to $80,000,000 would be available for grant financing
of water conservation projects, which grant funds
would be divided equally between the United States
and Mexico.
(b) SENSE OF THE CONGRESS.—It is the sense of the
Congress that—
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(1) water conservation projects are eligible for
funding from the North American Development Bank
under the Agreement Between the Government of the
United States of America and the Government of the
United Mexican States Concerning the Establishment
of a Border Environment Cooperation Commission
and a North American Development Bank; and
(2) the Board of the North American Develop-
ment Bank should support qualified water conserva-
tion projects which can assist Texas irrigators and
agricultural producers in the lower Rio Grande River
Valley.
SEC. 4. SENSE OF THE CONGRESS RELATING TO UNITED
STATES SUPPORT FOR NADBANK PROJECTS
WHICH FINANCE WATER CONSERVATION IN
THE SOUTHERN CALIFORNIA AREA.
It is the sense of the Congress that the Board of the
North American Development Bank should support—
(1) the development of qualified water conserva-
tion projects in southern California and other eligible
areas in the 4 United States border States, including
the conjunctive use and storage of surface and ground
water, delivery system conservation, the re-regulation
of reservoirs, improved irrigation practices, waste-
water reclamation, regional water management mod-
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eling, operational and optimization studies to im-
prove water conservation, and cross-border water ex-
changes consistent with treaties; and
(2) new water supply research and projects along
the Mexico border in southern California and other el-
igible areas in the 4 United States border States to
desalinate ocean seawater and brackish surface and
groundwater, and dispose of or manage the brines re-
sulting from desalination.
SEC. 5. SENSE OF THE CONGRESS RELATING TO UNITED
STATES SUPPORT FOR NADBANK PROJECTS
FOR WHICH FINANCE WATER CONSERVATION
FOR IRRIGATORS AND AGRICULTURAL PRO-
DUCERS IN THE SOUTHWEST UNITED STATES.
(a) FINDINGS.—The Congress finds as follows:
(1) Irrigators and agricultural producers are
suffering enormous hardships in the southwest United
States. The border States of California, Arizona, New
Mexico, and Texas are suffering from one of the worst
droughts in history. In Arizona, this is the second
driest period in recorded history and the worst since
1904.
(2) In spite of decades of water conservation in
the southwest United States, irrigated agriculture uses
more than 60 percent of surface and ground water.
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(3) The most inadequate water supplies in the
United States are in the Southwest, including the
lower Colorado River basin and the Great Plains
River basins south of the Platte River. In these areas,
70 percent of the water taken from the stream is not
returned.
(4) The amount of water being pumped out of
groundwater sources in many areas is greater than
the amount being replenished, thus depleting the
groundwater supply.
(5) On August 20, 2002, the Board of the North
American Development Bank agreed to the creation
in the bank of a Water Conservation Investment
Fund.
(6) The Water Conservation Investment Fund of
the North American Development Bank stated that up
to $80,000,000 would be available for grant financing
of water conservation projects, which grant funds
would be divided equally between the United States
and Mexico.
(b) SENSE OF THE CONGRESS.—It is the sense of the
Congress that—
(1) water conservation projects are eligible for
funding from the North American Development Bank
under the Agreement Between the Government of the
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United States of America and the Government of the
United Mexican States Concerning the Establishment
of a Border Environment Cooperation Commission
and a North American Development Bank;
(2) the Board of the North American Develop-
ment Bank should support qualified water conserva-
tion projects that can assist irrigators and agricul-
tural producers; and
(3) the Board of the North American Develop-
ment Bank should take into consideration the needs
of all of the border states before approving funding for
water projects, and strive to fund water conservation
projects in each of the border states.
SEC. 6. SENSE OF THE CONGRESS REGARDING FINANCING
OF PROJECTS.
(a) IN GENERAL.—It is the sense of the Congress that
the Board of the North American Development Bank should
support the financing of projects, on both sides of the inter-
national boundary between the United States and Mexico,
that address coastal issues and the problem of pollution in
both countries having an environmental impact along the
Pacific Ocean and Gulf of Mexico shores of the United
States and Mexico.
(b) AIR POLLUTION.—It is the sense of the Congress
that the Board of the North American Development Bank
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should support the financing of projects, on both sides of
the international boundary between the United States and
Mexico, which address air pollution.
Attest:
Secretary.