IB 
Union Calendar No. 449
107TH CONGRESS 
2D SESSION 
H. R. 5400
[Report No. 107–720] 
To authorize the President of the United States to agree to certain amend-
ments 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 Cooperation Commission 
and a North American Development Bank, and for other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
SEPTEMBER 18, 2002
Mr. BEREUTER (for himself, Mr. OSE, Mr. GONZALEZ, and Mr. HINOJOSA) 
introduced the following bill; which was referred to the Committee on Fi-
nancial Services 
OCTOBER 3, 2002
Reported with an amendment, committed to the Committee of the Whole 
House on the State of the Union, and ordered to be printed 
[Strike out all after the enacting clause and insert the part printed in italic] 
[For text of introduced bill, see copy of bill as introduced on September 18, 2002] 
A BILL 
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 Cooperation
Commission and a North American Development Bank, 
and for other purposes.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. AUTHORITY TO AGREE TO CERTAIN AMEND-
MENTS TO THE BORDER ENVIRONMENT CO-
OPERATION AGREEMENT. 
(a) IN GENERAL.—Part 2 of subtitle D of title V of 
Public Law 103–182 (22 U.S.C. 290m—290m–3) is amend-
ed by adding at the end the following: 
‘‘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) 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:
‘‘Sec. 545. Authority to agree to certain amendments to the Border Environment 
Cooperation Agreement.’’.
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. 
(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 
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—
(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-
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. 
(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 
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. ADDITIONAL SENSES OF THE CONGRESS. 
(a) 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 international 
boundary between the United States and Mexico, which ad-
dress coastal issues and the problem of pollution in both 
countries having an environmental impact along the Pa-
cific Ocean and Gulf of Mexico shores of the United States 
and Mexico.
(b) 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 international 
boundary between the United States and Mexico, which ad-
dress air pollution.
Union Calendar No. 449
107TH CONGRESS 
2D SESSION 
H. R. 5400
[Report No. 107–720] 
A BILL 
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 Cooperation Commission 
and a North American Development Bank, and 
for other purposes. 
OCTOBER 3, 2002
Reported with an amendment, committed to the Com-
mittee of the Whole House on the State of the Union, 
and ordered to be printed