I 
116TH CONGRESS 
1ST SESSION H. R. 4051 
To create a Climate Action Rebate Fund in order to efficiently reduce green-
house gas emissions, provide a monthly rebate to the American people, 
encourage innovation of clean energy technologies and create new eco-
nomic opportunities, ensure the resiliency of our infrastructure, assist 
with the transition to a clean energy economy, and leave a healthier, 
more stable, and more prosperous nation for future generations. 
IN THE HOUSE OF REPRESENTATIVES 
JULY 25, 2019 
Mr. PANETTA (for himself and Mr. SUOZZI) introduced the following bill; 
which was referred to the Committee on Ways and Means, and in addi-
tion to the Committees on Transportation and Infrastructure, Agri-
culture, Energy and Commerce, Financial Services, Natural Resources, 
Veterans’ Affairs, Education and Labor, Science, Space, and Technology, 
and Foreign Affairs, 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 create a Climate Action Rebate Fund in order to effi-
ciently reduce greenhouse gas emissions, provide a 
monthly rebate to the American people, encourage inno-
vation of clean energy technologies and create new eco-
nomic opportunities, ensure the resiliency of our infra-
structure, assist with the transition to a clean energy 
economy, and leave a healthier, more stable, and more 
prosperous nation for future generations. 
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Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Climate Action Rebate 
Act of 2019’’. 
SEC. 2. FINDINGS. 
The Congress finds that— 
(1) climate change is costing the United States 
billions of dollars of economic losses and poses an 
existential threat to our safety and security; 
(2) markets should reflect all costs of goods, in-
cluding external factors such as pollution; and 
(3) creation of a Climate Action Rebate Fund 
can make markets more efficient, create jobs, stimu-
late innovation, invest in infrastructure, put money 
back in the pockets of Americans, and provide for 
the transition to a cleaner energy future. 
SEC. 3. CARBON FEE. 
(a) IN GENERAL.—Chapter 38 of subtitle D of the 
Internal Revenue Code of 1986 is amended by adding at 
the end the following new subchapter: 
‘‘Subchapter E—Carbon Fee 
‘‘Sec. 4691. Definitions. 
‘‘Sec. 4692. Carbon fee. 
‘‘Sec. 4693. Emissions reduction schedule. 
‘‘Sec. 4694. Fee on fluorinated greenhouse gases. 
‘‘Sec. 4695. Carbon capture refunds. 
‘‘Sec. 4696. Carbon border fee adjustment. 
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‘‘Sec. 4697. Administration of the carbon border fee adjustment. 
‘‘Sec. 4698. Allocation of carbon border fee adjustment revenues. 
‘‘SEC. 4691. DEFINITIONS. 
‘‘For purposes of this subchapter— 
‘‘(a) ADMINISTRATOR.—The term ‘Administrator’ 
means the Administrator of the Environmental Protection 
Agency. 
‘‘(b) CARBON DIOXIDE EQUIVALENT OR CO2-E.— 
The term ‘carbon dioxide equivalent’ or ‘CO2-e’ means the 
number of metric tons of carbon dioxide emissions with 
the same global warming potential as one metric ton of 
another greenhouse gas. 
‘‘(c) CARBON-INTENSIVE PRODUCT.—The term ‘car-
bon-intensive product’ means— 
‘‘(1) iron, steel, steel mill products (including 
pipe and tube), aluminum, cement, glass (including 
flat, container, and specialty glass and fiberglass), 
pulp, paper, chemicals, or industrial ceramics, and 
‘‘(2) any manufactured product which the Sec-
retary, in consultation with the Administrator, deter-
mines is energy-intensive and trade-exposed (with 
the exception of any covered fuel). 
‘‘(d) COVERED ENTITY.—The term ‘covered entity’ 
means— 
‘‘(1) in the case of crude oil— 
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‘‘(A) any operator of a United States refin-
ery (as described in subsection (d)(1) of section 
4611), and 
‘‘(B) any person entering such product 
into the United States for consumption, use, or 
warehousing (as described in subsection (d)(2) 
of such section), 
‘‘(2) in the case of coal— 
‘‘(A) any producer subject to the tax under 
section 4121, and 
‘‘(B) any importer of coal into the United 
States, 
‘‘(3) in the case of natural gas— 
‘‘(A) any entity which produces natural 
gas (as defined in section 613A(e)(2)) from a 
well located in the United States, and 
‘‘(B) any importer of natural gas into the 
United States, 
‘‘(4) in the case of fluorinated gases, any entity 
required to report the emission of a fluorinated gas 
under part 98 of title 40, Code of Federal Regula-
tions, 
‘‘(5) in the case of solid biomass, any entity 
which operates a facility that combusts such solid 
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biomass in a manner which emits a greenhouse gas 
into the atmosphere, and 
‘‘(6) any entity or class of entities which, as de-
termined by the Secretary, is transporting, selling, 
or otherwise using a covered fuel in a manner which 
emits a greenhouse gas into the atmosphere and 
which has not been covered by the carbon fee, the 
fluorinated greenhouse gas fee, or the carbon border 
fee adjustment. 
‘‘(e) COVERED
FUEL.—The term ‘covered fuel’ 
means crude oil, natural gas, coal, solid biomass, or any 
other product derived from crude oil, natural gas, or coal 
which shall be used so as to emit greenhouse gases to the 
atmosphere. 
‘‘(f) FULL FUEL CYCLE GREENHOUSE GAS EMIS-
SIONS.—The term ‘full fuel cycle greenhouse gas emis-
sions’ means the greenhouse gas content of a covered fuel 
(excluding solid biomass) plus that covered fuel’s up-
stream greenhouse gas emissions. 
‘‘(g) GREENHOUSE GAS.—The term ‘greenhouse gas’ 
has the same meaning given such term under paragraph 
(3) of section 901 of the Energy Independence and Secu-
rity Act of 2007 (42 U.S.C. 17321), and shall include any 
other gases as identified by rule of the Administrator. 
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‘‘(h) GREENHOUSE
GAS
CONTENT.—The term 
‘greenhouse gas content’ means the amount of greenhouse 
gases, expressed in metric tons of CO2-e, which would be 
emitted to the atmosphere by the use of a covered fuel. 
‘‘(i) SOLID BIOMASS.—The term ‘solid biomass’ 
means nonfossilized and biodegradable organic material 
originating from plants, animals or microorganisms, in-
cluding products, byproducts, residues and waste from ag-
riculture, forestry and related industries as well as the 
nonfossilized and biodegradable organic fractions of indus-
trial and municipal wastes, but does not include gases and 
liquids recovered from the decomposition of nonfossilized 
and biodegradable organic material. 
‘‘(j) UNITED STATES.—The term ‘United States’ 
shall be treated as including each possession of the United 
States (including the Commonwealth of Puerto Rico and 
the Commonwealth of the Northern Mariana Islands). 
‘‘SEC. 4692. CARBON FEE. 
‘‘(a) CARBON FEE.—There is hereby imposed a car-
bon fee on any covered entity’s use, sale, or transfer of 
any covered fuel. 
‘‘(b) AMOUNT OF THE CARBON FEE.—The carbon 
fee imposed by this section is an amount equal to— 
‘‘(1) the greenhouse gas content of the covered 
fuel, multiplied by 
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‘‘(2) the carbon fee rate. 
‘‘(c) CARBON FEE RATE.—For purposes of this sec-
tion— 
‘‘(1) IN GENERAL.—The carbon fee rate, with 
respect to any use, sale, or transfer during a cal-
endar year, shall be— 
‘‘(A) in the case of calendar year 2020, 
$15, and 
‘‘(B) except as provided in paragraph (2), 
in the case of any calendar year thereafter, the 
carbon fee rate in effect under this subsection 
for the preceding calendar year, plus $15. 
‘‘(2) EXCEPTIONS.— 
‘‘(A) 
INCREASED
CARBON
FEE
RATE 
AFTER MISSED ANNUAL EMISSIONS REDUCTION 
TARGET.—In the case of any year immediately 
following a year for which the Secretary deter-
mines under 4693(b) that the emissions of 
greenhouse gases from covered fuels exceeded 
the emissions reduction target for the previous 
year, paragraph (1)(B) shall be applied by sub-
stituting ‘$30’ for ‘$15’. 
‘‘(B) CESSATION OF CARBON FEE RATE IN-
CREASE AFTER CERTAIN EMISSION REDUCTIONS 
ACHIEVED.—In the case of any year imme-
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diately following a year for which the Secretary 
determines under 4693(b) that emissions of 
greenhouse gases from covered fuels are not 
more than 10 percent of the greenhouse gas 
emissions from covered fuels during the year 
2017, paragraph (1)(B) shall be applied by sub-
stituting ‘$0’ for ‘$15’. 
‘‘(d) SOLID BIOMASS.—For purposes of subsection 
(b), in the case of a covered fuel which consists of solid 
biomass, the greenhouse gas content of such covered fuel 
shall be determined by the Administrator based on the 
lifecycle greenhouse gas emissions of such fuel, as defined 
in section 211(o)(1)(H) of the Clean Air Act (42 U.S.C. 
7545(o)(1)(H)). 
‘‘(e) EXEMPTION AND REFUND.—The Secretary shall 
prescribe such rules as are necessary to ensure the carbon 
fee imposed by this section is not imposed with respect 
to any nonemitting use, or any sale or transfer for a non-
emitting use, including rules providing for the refund of 
any carbon fee paid under this section with respect to any 
such use, sale, or transfer. 
‘‘(f) ADMINISTRATIVE AUTHORITY.—The Secretary, 
in consultation with the Administrator, shall prescribe 
such regulations, and other guidance, to assess and collect 
the carbon fee imposed by this section, including— 
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‘‘(1) requirements for the quarterly payment of 
such fees, and 
‘‘(2) rules to ensure that no covered fuel has 
the carbon fee or the carbon border fee adjustment 
imposed upon it more than once. 
‘‘SEC. 4693. EMISSIONS REDUCTION SCHEDULE. 
‘‘(a) IN GENERAL.—An emissions reduction schedule 
for greenhouse gas emissions from covered fuels is hereby 
established, as follows: 
‘‘(1) REFERENCE YEAR.— 
‘‘(A) IN
GENERAL.—Subject to subpara-
graph (B), the greenhouse gas emissions from 
covered fuels during the year 2017 shall be the 
reference amount of emissions and shall be de-
termined from the ‘Inventory of U.S. Green-
house Gas Emissions and Sinks: 1990–2017’ 
published by the Environmental Protection 
Agency in April of 2019. 
‘‘(B) UPDATES.—If the greenhouse gas 
emissions from covered fuels during the year 
2017 is revised by the Administrator in a sub-
sequent report, the amount of such emissions 
contained in such report shall apply for pur-
poses of this section. 
‘‘(2) EMISSIONS REDUCTION TARGETS.— 
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‘‘(A) 2020 THROUGH 2030.—The emissions 
reduction target for each calendar year during 
the period of calendar years 2020 through 2030 
shall be determined as follows: 
‘‘Year 
Emissions Reduction Target 
2017 
Reference year 
2020 
90 percent of 2017 emissions 
2021 
81 percent of 2017 emissions 
2022 
74 percent of 2017 emissions 
2023 
68 percent of 2017 emissions 
2024 
63 percent of 2017 emissions 
2025 
59 percent of 2017 emissions 
2026 
56 percent of 2017 emissions 
2027 
52 percent of 2017 emissions 
2028 
50 percent of 2017 emissions 
2029 
47 percent of 2017 emissions 
2030 
45 percent of 2017 emissions 
‘‘(B) 2031 THROUGH 2050.—The emissions 
reduction target for each calendar year during 
the period of calendar years 2031 through 2050 
shall be equal to the emissions reduction target 
for the preceding year reduced by an amount 
equal to 2.25 percent of 2017 emissions. 
‘‘(b) ADMINISTRATIVE DETERMINATION.—Not later 
than 90 days after the beginning of each calendar year 
beginning after the date of the enactment of this section, 
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the Secretary, in consultation with the Administrator, 
shall determine whether emissions of greenhouse gases 
from covered fuels exceeded the emissions reduction target 
for the preceding calendar year. The Secretary shall make 
such determination using the same greenhouse gas ac-
counting method as was used to determine the greenhouse 
gas emissions in the ‘Inventory of U.S. Greenhouse Gas 
Emissions and Sinks: 1990–2017’ published by the Envi-
ronmental Protection Agency in April of 2019. 
‘‘SEC. 4694. FEE ON FLUORINATED GREENHOUSE GASES. 
‘‘(a) FLUORINATED GAS FEE.—A fee is hereby im-
posed upon any fluorinated greenhouse gas which is re-
quired to be reported under part 98 of title 40, Code of 
Federal Regulations. 
‘‘(b) AMOUNT.—The fee to be paid by the covered 
entity required to so report shall be an amount equal to— 
‘‘(1) the total amount, in metric tons of CO2- 
e, of emitted fluorinated greenhouse gases (or, in the 
case of a supplier, emissions that would result deter-
mined under the rules of such part), multiplied by 
‘‘(2) an amount equal to 20 percent of the car-
bon fee rate in effect under section 4692(c)(1) for 
the calendar year of such emission. 
‘‘(c) ADMINISTRATIVE AUTHORITY.—The Secretary, 
in consultation with the Administrator, shall prescribe 
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such regulations, and other guidance, to assess and collect 
the carbon fee imposed by this section, including— 
‘‘(1) requirements for the quarterly payment of 
such fees, and 
‘‘(2) rules to ensure that no covered fuel has 
the carbon fee or the carbon border fee adjustment 
imposed upon it more than once. 
‘‘SEC. 4695. CARBON CAPTURE REFUNDS. 
‘‘(a) IN GENERAL.—The Secretary, in consultation 
with the Administrator and the heads of other relevant 
Federal agencies, shall prescribe regulations for providing 
payments to any person which captures qualified carbon 
oxide (as defined in subsection (c) of section 45Q) which 
is— 
‘‘(1) disposed of by such person in secure geo-
logical storage, as described in subsection (f)(2) of 
such section, 
‘‘(2) used by such person as a tertiary injectant 
in a qualified enhanced oil or natural gas recovery 
project (as defined in subsection (e)(2) of such sec-
tion) and disposed of by such person in secure geo-
logical storage, or 
‘‘(3) utilized by such person in a manner de-
scribed in subsection (f)(5) of such section. 
‘‘(b) PAYMENTS FOR CARBON CAPTURE.— 
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‘‘(1) IN GENERAL.—In the case of any indus-
trial facility for which carbon capture equipment has 
been placed in service, the Secretary shall make pay-
ments to the owner of such facility in the same man-
ner as if such payment was a refund of an overpay-
ment of the carbon fee imposed by section 4692. 
‘‘(2) AMOUNT OF PAYMENT.—The payment de-
termined under this subsection shall be an amount 
equal to— 
‘‘(A) the metric tons of qualified carbon 
oxide captured and disposed of, used, or utilized 
in a manner consistent with subsection (a), 
multiplied by 
‘‘(B) the carbon fee rate during the year in 
which the carbon fee was imposed by section 
4692 upon the covered fuel to which such car-
bon oxide relates. 
‘‘(3) COORDINATION WITH CREDIT FOR CARBON 
OXIDE SEQUESTRATION.—At such time that the Sec-
retary prescribes regulations implementing this sec-
tion, no payment under this section shall be allowed 
to any person for any unit of carbon oxide for which 
a credit has been allowed with respect to such unit 
under section 45Q. 
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‘‘(c) EXCEPTION.—In the case of any industrial facil-
ity which is owned by an entity that is determined to be 
in violation of any applicable air quality regulations, such 
facility shall not be eligible for any payment under this 
section during the period of such violation. 
‘‘SEC. 4696. CARBON BORDER FEE ADJUSTMENT. 
‘‘(a) IN GENERAL.—The fees imposed by, and re-
funds allowed under, this section shall be referred to as 
‘the carbon border fee adjustment’. 
‘‘(b) IMPORTED COVERED FUELS FEE.—In the case 
of any person that imports into the United States any cov-
ered fuel, there shall be imposed a fee equal to the excess 
(if any) of— 
‘‘(1) an amount equal to— 
‘‘(A) the amount of full fuel cycle green-
house gas emissions of such fuel, multiplied by 
‘‘(B) the carbon fee rate in effect for the 
year in which such fuel is imported, over 
‘‘(2) the total foreign cost of carbon carried by 
such fuel. 
‘‘(c) 
IMPORTED
CARBON-INTENSIVE
PRODUCTS 
FEE.—In the case of any person that imports into the 
United States any carbon-intensive products, there shall 
be imposed a fee equal to the excess (if any) of— 
‘‘(1) an amount equal to— 
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‘‘(A) production greenhouse gas emissions 
of such product, multiplied by 
‘‘(B) the carbon fee rate in effect for the 
year in which the production greenhouse gas 
emissions of such product were emitted into the 
atmosphere, over 
‘‘(2) the total foreign cost of carbon carried by 
such product. 
‘‘(d) 
REFUND
ON
EXPORTS
FROM
UNITED 
STATES.— 
‘‘(1) CARBON-INTENSIVE
PRODUCTS.—Under 
regulations prescribed by the Secretary, there shall 
be allowed a credit or refund (without interest) to 
exporters of carbon-intensive products manufactured 
or produced in the United States an amount equal 
to the excess (if any) of— 
‘‘(A) an amount equal to— 
‘‘(i) the production greenhouse gas 
emissions of the exported carbon-intensive 
product, multiplied by 
‘‘(ii) the carbon fee rate during the 
year in which the carbon fee or fluorinated 
greenhouse gas fee was paid upon the pro-
duction greenhouse gas emissions of the 
exported carbon-intensive product, over 
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‘‘(B) any total cost of carbon to be levied 
upon the carbon-intensive product by any juris-
diction to which the carbon-intensive product is 
to be imported. 
Any such credit or refund shall be allowed in the 
same manner as if it were an overpayment of the fee 
imposed by section 4692 or 4694. The Secretary 
shall establish fair, timely, impartial, and as nec-
essary confidential procedures by which any exporter 
of any product from the United States may petition 
the Secretary to include that exported product on 
the list of carbon-intensive products. 
‘‘(2) COVERED FUELS.—Under regulations pre-
scribed by the Secretary, in the case of a covered 
fuel produced in the United States with respect to 
which the fee under section 4692 was paid, there 
shall be allowed as a credit or refund (without inter-
est) to any exporter of such covered fuels an amount 
equal to the excess (if any) of— 
‘‘(A) an amount equal to— 
‘‘(i) the full fuel cycle greenhouse gas 
emissions of the covered fuel, multiplied by 
‘‘(ii) the carbon fee rate at the time 
the carbon fee was paid upon the full fuel 
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cycle greenhouse gas emissions of the ex-
ported covered fuel, over 
‘‘(B) any total cost of carbon to be levied 
upon the covered fuel by a jurisdiction to which 
the carbon-intensive product is to be imported. 
Any such credit or refund shall be allowed in the 
same manner as if it were an overpayment of tax 
imposed by section 4692. 
‘‘(e) DEFINITIONS.—For purposes of this section and 
section 4697— 
‘‘(1) FOREIGN COST OF CARBON; FOREIGN CAR-
BON COSTS.—The term ‘foreign cost of carbon’ or 
‘foreign carbon cost’ means the cost of any laws of 
a foreign jurisdiction which impose a system of cap- 
and-trade with respect to, or a tax or fee on, green-
house gas. Such cost shall be determined and ex-
pressed as a price per ton of CO2-e. 
‘‘(2) PRODUCTION
GREENHOUSE
GAS
EMIS-
SIONS.—The term ‘production greenhouse gas emis-
sions’ means the quantity of greenhouse gases, ex-
pressed in metric tons of CO2-e, emitted to the at-
mosphere resulting from, nonexclusively, the produc-
tion, manufacture, assembly, transportation, or fi-
nancing of a product. 
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‘‘(3) TOTAL COST OF CARBON CARRIED.—The 
term ‘total cost of carbon carried’ means an amount 
equal to— 
‘‘(A) the production greenhouse gas emis-
sions of a carbon-intensive product or the full 
fuel cycle greenhouse gas emissions of a covered 
fuel, multiplied by 
‘‘(B) the cost of carbon with respect to 
such product or fuel, reduced by any amount 
refunded with respect to such product or fuel 
by a foreign jurisdiction. 
The total cost of carbon carried shall be expressed 
as price in United States dollars. 
‘‘(4) TOTAL FOREIGN COST OF CARBON CAR-
RIED.—The term ‘total foreign cost of carbon car-
ried’ means an amount equal to— 
‘‘(A) the production greenhouse gas emis-
sions of a carbon-intensive product, or the full 
fuel cycle greenhouse gas emissions of a covered 
fuel, multiplied by 
‘‘(B) the foreign cost of carbon with re-
spect to such product or fuel, reduced by the 
amount refunded with respect to such product 
or fuel by a foreign jurisdiction. 
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The total foreign cost of carbon carried shall be ex-
pressed as price in United States dollars. 
‘‘(5) UPSTREAM
GREENHOUSE
GAS
EMIS-
SIONS.—The term ‘upstream greenhouse gas emis-
sions’ means the quantity of greenhouse gases, ex-
pressed in metric tons of CO2-e, emitted to the at-
mosphere resulting from, nonexclusively, the extrac-
tion, processing, transportation, financing, or other 
preparation of a covered fuel for use. 
‘‘SEC. 4697. ADMINISTRATION OF THE CARBON BORDER 
FEE ADJUSTMENT. 
‘‘(a) IN GENERAL.—The Secretary, in consultation 
with the Administrator, shall prescribe regulations and 
guidance which implement the carbon border fee adjust-
ment under section 4696. 
‘‘(b) COLLABORATION.—In determining the produc-
tion greenhouse gas emissions of an imported carbon-in-
tensive product, the upstream greenhouse gas emissions 
of an imported covered fuel, the full fuel cycle greenhouse 
gas emissions of an imported covered fuel, or the foreign 
cost of carbon, or otherwise administering the carbon bor-
der fee adjustment, it is the sense of Congress that the 
Secretary should collaborate with authorized officers of 
any jurisdiction, including sub-national governments, af-
fected by the carbon border fee adjustment. 
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‘‘(c) METHODOLOGY.—In determining the production 
greenhouse gas emissions of an imported carbon-intensive 
product, the upstream greenhouse gas emissions of an im-
ported covered fuel, the full fuel cycle greenhouse gas 
emissions of an imported covered fuel, or the foreign cost 
of carbon, the Secretary shall use reliable methodologies, 
which— 
‘‘(1) as may be necessary or convenient— 
‘‘(A) distinguish between different types of 
covered fuels, 
‘‘(B) distinguish between a covered fuel’s 
greenhouse gas content and that covered fuel’s 
upstream greenhouse gas emissions, 
‘‘(C) distinguish between the different 
types of greenhouse gas emissions which com-
pose a covered fuel’s upstream greenhouse gas 
emissions or greenhouse gas content, as well as 
the various processes which produced those 
emissions, and 
‘‘(D) distinguish between the different 
types of greenhouse gas emissions which com-
pose a carbon-intensive product’s production 
greenhouse gas emissions, as well as the various 
processes which produced those emissions, 
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‘‘(2) ensure that no covered fuel, covered 
fluorinated greenhouse gas, or carbon-intensive prod-
uct has the carbon fee, the fluorinated greenhouse 
gas fee, or the border fee adjustment imposed upon 
it more than once, 
‘‘(3) ensure that the implementation of the bor-
der carbon adjustment aligns with the carbon fee 
and the fluorinated gas fee, 
‘‘(4) in the case of incomplete data, rely upon 
the best available methodologies for interpolating 
data gaps, and 
‘‘(5) are consistent with international treaties 
and agreements. 
‘‘(d) PROCEDURE.—The Secretary shall establish 
fair, timely, impartial, and as necessary confidential proce-
dures by which the importer of any carbon-intensive prod-
uct or any covered fuel may petition the Secretary to re-
vise the Secretary’s determination of the production green-
house gas emissions, full fuel cycle greenhouse gas emis-
sions, or upstream greenhouse gas emissions of that im-
porter’s imported covered fuel or imported carbon-inten-
sive product, or the foreign cost of carbon carried by that 
importer’s imported carbon-intensive product. 
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‘‘SEC. 4698. ALLOCATION OF CARBON BORDER FEE ADJUST-
MENT REVENUES. 
‘‘The revenues collected under section 4696 may be 
used to supplement appropriations made available in fiscal 
years 2020 and thereafter— 
‘‘(1) to U.S. Customs and Border Protection, in 
such amounts as are necessary to administer the 
carbon border fee adjustment, 
‘‘(2) from the amounts remaining following pay-
ment of the expenses described in paragraph (1), to 
the Department of Treasury, in such amounts as are 
necessary to allow refunds under section 4696(e) to 
exporters of carbon-intensive products and exporters 
of covered fuels, and 
‘‘(3) from the amounts remaining following pay-
ment of the expenses described in paragraphs (1) 
and (2)— 
‘‘(A) to the Department of State and the 
United States Agency for International Devel-
opment for programs to address climate mitiga-
tion and adaptation in developing countries, in-
cluding contributions to the Green Climate 
Fund, and 
‘‘(B) to the Export-Import Bank of the 
United States to facilitate exportation of clean 
energy technologies’’. 
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(b) PAYMENTS TO FARMERS AND LANDOWNERS FOR 
NATURE-BASED PROJECTS.— 
(1) IN
GENERAL.—The Secretary of Agri-
culture, in consultation with the Administrator of 
the Environmental Protection Agency, shall provide 
payments to farmers and landowners within the 
United States to implement carbon sequestration 
projects with measurable greenhouse gas reduction 
benefits or other nature-based projects that reduce 
greenhouse gas emissions, including projects for— 
(A) ecologically-appropriate reforestation, 
(B) restoration of wetlands, 
(C) agricultural practices such as the 
usage of cover crops, no till, and practices that 
can reduce emissions from livestock, fertilizers, 
and rice cultivation, and 
(D) other appropriate practices as deter-
mined by the Secretary of Agriculture. 
(2) AMOUNT OF PAYMENT.—Not later than 180 
days after the date of enactment of this Act, the 
Secretary of Agriculture, in consultation with the 
Administrator of the Environmental Protection 
Agency, shall issue regulations to determine the 
amount of a payment under paragraph (1), taking 
into account the use of certified third-party reg-
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istries for verification of emissions reductions and 
provisions for addressing the potential imperma-
nence of carbon sequestration in biomass and soils. 
(c) PAYMENTS FOR DIRECT AIR CAPTURE OF CAR-
BON DIOXIDE.— 
(1) IN GENERAL.—Subject to paragraph (3), 
the Secretary of Energy, in consultation with the 
Administrator of the Environmental Protection 
Agency and the heads of any other relevant agen-
cies, shall make payments to any direct air capture 
facility (as defined in section 45Q(e)(1) of the Inter-
nal Revenue Code of 1986) within the United States 
that uses carbon capture equipment to capture car-
bon dioxide directly from the ambient air and dis-
poses of such carbon dioxide in secure geological 
storage (as described in section 45Q(f)(2) of such 
Code). 
(2) PAYMENT
AMOUNT.—A payment under 
paragraph (1) shall be in an amount equal to the 
product obtained by multiplying— 
(A) the metric tons of carbon dioxide cap-
tured and disposed of by the facility; and 
(B) the carbon fee rate in effect during the 
calendar year preceding the year in which the 
capture of such carbon dioxide occurs. 
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(3) EXCEPTION.—In the case of any direct air 
capture facility which is owned by an entity that is 
determined to be in violation of any applicable air 
quality regulations, such facility shall not be eligible 
for any payment under this section during the period 
of such violation. 
(4) COORDINATION WITH CREDIT FOR CARBON 
DIOXIDE
SEQUESTRATION.—The Secretary of En-
ergy shall not make a payment under this subsection 
with respect to any facility for any unit of carbon di-
oxide for which a credit has been allowed with re-
spect to such unit under section 45Q of the Internal 
Revenue Code of 1986. 
(d) COORDINATION WITH CARBON OXIDE SEQUES-
TRATION CREDIT.—Section 45Q(f) is amended by adding 
at the end the following new paragraph: 
‘‘(8) COORDINATION
WITH
CARBON
CAPTURE 
AND SEQUESTRATION PAYMENTS.—No credit shall 
be allowed under this section with respect to any 
unit of carbon oxide which has received any refund 
or payment with respect to such unit under section 
3(c) of the Climate Action Rebate Act of 2019 or 
section 4695.’’. 
(e) INTERNATIONAL NEGOTIATIONS.—The Congress 
finds the international mitigation of greenhouse gas emis-
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sions to be of national importance. Therefore, the Con-
gress encourages the Secretary of State, or the Secretary’s 
designee, to commence and complete negotiations with 
other nations with the goal of forming treaties, environ-
mental agreements, accords, partnerships, or any other in-
strument that effectively reduces global greenhouse gas 
emissions to 10 percent of 2017 levels by 2050 and which 
respect the principle of common but differentiated respon-
sibilities and respective capabilities. 
SEC. 4. ESTABLISHMENT OF THE CLIMATE ACTION REBATE 
FUND. 
(a) IN GENERAL.—Subchapter A of chapter 98 of the 
Internal Revenue Code of 1986 is amended by adding at 
the end the following: 
‘‘SEC. 9512. CLIMATE ACTION REBATE FUND. 
‘‘(a) ESTABLISHMENT
AND
FUNDING.—There is 
hereby established in the Treasury of the United States 
a trust fund to be known as the ‘Climate Action Rebate 
Fund’, consisting of such amounts as may be appropriated 
to such trust fund as provided for in this section. 
‘‘(b) TRANSFERS TO THE CLIMATE ACTION REBATE 
FUND.—There is hereby appropriated to the Climate Ac-
tion Rebate Fund amounts equal to the fees received into 
the Treasury less any amounts refunded or paid under 
sections 4692(d) and 4695 for each month. 
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‘‘(c) EXPENDITURES.—Amounts in the trust fund 
shall be available for the following purposes: 
‘‘(1) 
CARBON
FEE
ADMINISTRATIVE
EX-
PENSES.—So much of the expenses as are necessary 
to administer sections 4692 through 4695 for any 
year as does not to exceed 0.60 percent of the 
amounts appropriated to the Climate Action Rebate 
Fund for the previous year. 
‘‘(2) CLIMATE ACTION REBATE FUND ADMINIS-
TRATIVE EXPENSES.—So much of the expenses nec-
essary to administer the Climate Action Rebate 
Fund for each year, as does not exceed— 
‘‘(A) in the case of the first 5 fiscal years 
ending after the date of the enactment of this 
section, the administrative expenses for any 
year may not exceed 5 percent of amounts ap-
propriated to the Climate Action Rebate Fund 
during such year, and 
‘‘(B) in the case of any fiscal year there-
after, 1.5 percent of the 5-year rolling average 
of the amounts appropriated to the Climate Ac-
tion Rebate Fund. 
‘‘(3) CLIMATE ACTION REBATE PAYMENTS.— 
‘‘(A) IN GENERAL.—For each fiscal year, 
the amounts remaining in the Climate Action 
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Rebate Fund following payment of expenses 
under paragraphs (1) and (2) shall be appor-
tioned as follows: 
‘‘(i) 70 percent of such amounts for 
the purposes described in subsection (d), 
‘‘(ii) 20 percent of such amounts for 
the purposes described in subsection (e), 
‘‘(iii) 5 percent of such amounts for 
the purposes described in subsection (f), 
and 
‘‘(iv) 5 percent of such amounts for 
the purposes described in subsection (g). 
‘‘(d) CARBON DIVIDEND.— 
‘‘(1) IN GENERAL.—From the amounts in the 
Carbon Dividend Trust Fund made available under 
subsection (c)(3)(A)(i) for any year, the Secretary 
shall, for each month beginning more than 270 days 
after the date of the enactment of the Climate Ac-
tion Rebate Act of 2019, make carbon dividend pay-
ments to each eligible individual. 
‘‘(2) PRO-RATA
SHARE.—A carbon dividend 
payment is one pro-rata share for each adult and 
half a pro-rata share for each child under 19 years 
old of amounts available for the month in the Cli-
mate Action Rebate Fund. 
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‘‘(3) ELIGIBLE INDIVIDUAL.—The term ‘eligible 
individual’ means, with respect to any month, any 
natural living person who has a valid Social Security 
number or taxpayer identification number and is a 
citizen or lawful resident of the United States. The 
Secretary is authorized to verify an individual’s eligi-
bility to receive a carbon dividend payment. 
‘‘(4) PHASEOUT.— 
‘‘(A) IN
GENERAL.—In the case of any 
taxpayer whose modified adjusted gross income 
for the most recent taxable year for which a re-
turn has been filed exceeds the threshold 
amount, the amount of the carbon dividend oth-
erwise payable to any household member of the 
taxpayer under this subsection shall be reduced 
(but not below zero) by a dollar amount equal 
to 5 percent of such dividend (as determined 
before application of this paragraph) for each 
$1,000 (or fraction thereof) by which such tax-
payer’s modified adjusted gross income exceeds 
the threshold amount. 
‘‘(B) DEFINITIONS.—For purposes of this 
paragraph— 
‘‘(i) MODIFIED ADJUSTED GROSS IN-
COME.—The term ‘modified adjusted gross 
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income’ means adjusted gross income in-
creased by any amount excluded from 
gross income under section 911, 931, or 
933. 
‘‘(ii) 
HOUSEHOLD
MEMBER.—The 
term ‘household member of the taxpayer’ 
means the taxpayer, the taxpayer’s spouse, 
and any dependent of the taxpayer. 
‘‘(iii) 
THRESHOLD
AMOUNT.—The 
term ‘threshold amount’ means— 
‘‘(I) $130,000 in the case of a 
joint return, 
‘‘(II) $80,000 in the case of an 
individual who is not married, and 
‘‘(III) $65,000 in the case of a 
married individual filing a separate 
return. 
‘‘(C) REGULATIONS.—The Secretary shall 
prescribe such regulations, and other guidance, 
as may be necessary to carry out the purposes 
of this paragraph, including establishment of 
rules for eligible individuals who have not filed 
a recent tax return. 
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‘‘(5) 
FEE
TREATMENT
OF
PAYMENTS.— 
Amounts paid under this subsection shall be includ-
ible in gross income. 
‘‘(6) FEDERAL PROGRAMS AND FEDERAL AS-
SISTED
PROGRAMS.—The carbon dividend amount 
received by any eligible individual shall not be taken 
into account as income and shall not be taken into 
account as resources for purposes of determining the 
eligibility of such individual or any other individual 
for benefits or assistance, or the amount or extent 
of benefits or assistance, under any Federal program 
or under any State or local program financed in 
whole or in part with Federal funds. 
‘‘(7) ADVANCE PAYMENT.—The Secretary shall 
transfer to the Climate Action Rebate Fund such 
amounts as are necessary for the disbursement of an 
advanced carbon dividend to all eligible individuals 
as follows: 
‘‘(A) An advanced carbon dividend shall be 
the same as the anticipated first carbon divi-
dend required to be distributed under para-
graph (1) and shall be distributed the month 
prior to the first collection of the carbon fee. 
‘‘(B) Total amounts disbursed as advanced 
carbon dividends shall be deducted from the 
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carbon dividends on a pro-rata basis over the 
first 3 years after the disbursement of the first 
carbon dividends. 
‘‘(e) INFRASTRUCTURE.—From the amounts in the 
Carbon Dividend Trust Fund made available under sub-
section (c)(3)(A)(ii) for any year, the Secretary shall 
transfer such amounts as follows: 
‘‘(1) 50 percent to the Highway Trust Fund 
under section 9503, with— 
‘‘(A) 80 percent of such amount allocated 
to the Highway Account for the payment of ob-
ligations incurred in carrying out Federal-aid 
highway and highway safety construction pro-
grams authorized under title 23, United States 
Code, and 
‘‘(B) 20 percent of such amount allocated 
to the Mass Transit Account for the payment of 
obligations incurred in carrying out transit pro-
grams authorized under— 
‘‘(i) chapter 53 of title 49, United 
States Code, 
‘‘(ii) section 20005(b) of the Federal 
Public Transportation Act of 2012 (49 
U.S.C. 5303 note; Public Law 112–141), 
and 
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‘‘(iii) section 3006(b) of the Federal 
Public Transportation Act of 2015 (49 
U.S.C. 5310 note; Public Law 114–94). 
‘‘(2) 2.5 percent to the Department of Trans-
portation for national infrastructure investments for 
innovative multimodal projects (also known as the 
Better Utilizing Investments to Leverage Develop-
ment (BUILD) Transportation discretionary grant 
program). 
‘‘(3) 2.5 percent to the Department of Trans-
portation to make grants to the National Railroad 
Passenger Corporation for intercity passenger rail 
infrastructure, as authorized by section 11101 of the 
Passenger Rail Reform and Investment Act of 2015 
(title XI of division A of Public Law 114–94) and 
sections 22907 and 24911 of title 49, United States 
Code. 
‘‘(4) 5 percent to the Airport and Airway Trust 
Fund under section 9502 for the payment of obliga-
tions incurred in carrying out aviation programs au-
thorized under subtitle VII of title 49, United States 
Code. 
‘‘(5) 2.5 percent to the Department of Trans-
portation to support deployment of alternative fuel 
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vehicles, including electric vehicle charging stations 
and hydrogen fueling infrastructure. 
‘‘(6) 5 percent to the Environmental Protection 
Agency for drinking water infrastructure programs 
under the Safe Drinking Water Act (42 U.S.C. 300f 
et seq.) and wastewater and clean water infrastruc-
ture programs under the Federal Water Pollution 
Control Act (33 U.S.C. 1251 et seq.). 
‘‘(7) 2.5 percent to the Secretary of Agriculture 
for rural water or wastewater grants or direct or 
guaranteed loans under the Consolidated Farm and 
Rural Development Act (7 U.S.C. 1921 et seq.). 
‘‘(8) 1.5 percent to the Federal Communica-
tions Commission to expand broadband access in 
rural areas. 
‘‘(9) 5 percent to the Army Corps of Engineers 
for water resources development projects. 
‘‘(10) 2.5 percent for the Community Develop-
ment Block Grant program under title I of the 
Housing and Community Development Act of 1974 
(42 U.S.C. 5401 et seq.) to assist States, units of 
general local government, and Indian tribes, as those 
terms are defined in section 101 of such Act (42 
U.S.C. 5301), with planning and implementation of 
projects to support lowering emissions, and climate 
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