SECTION 1. SHORT TITLE.
This Act may be cited as the ‘‘Rural Community
Environmental Assistance Act of 1993’’.
SEC. 2. FINDINGS.
Congress finds that—
(1) rural communities face special problems in
providing for infrastructure facilities to protect the
environment 
and 
human 
health, 
including
wastewater treatment works and public water sys-
tems;
(2) rural communities often lack the economies
of scale which are necessary to provide an adequate
financial base for the construction and operation of
wastewater treatment works and public water sys-
tems;
(3) rural communities often have limited access
to financial markets due to limited management ca-
pabilities and limited access to financial and tech-
nical services;
(4) the Environmental Protection Agency has
estimated that between 21 percent and 30 percent of
rural communities will have difficulty using revenue
bonds for wastewater treatment works and public
water systems because of limited financial resources;
(5) many rural communities have not benefited
from existing financing and assistance programs of
the Federal Government for wastewater treatment
works and public water systems because such assist-
ance programs are often focused on the largest envi-
ronmental problems caused by larger municipalities;
(6) Federal grant assistance programs for
wastewater treatment have been phased out in favor
of State loan funds;
(7) some rural communities will have limited
access to such State loan funds and some economi-
cally distressed rural communities may be unable to
comply with pollution control requirements without
grant assistance;
(8) residents of rural communities often spend
a larger portion of their household income for envi-
ronmental services than residents of large commu-
nities;
(9) recent amendments to Federal environ-
mental laws will require additional efforts by rural
communities to address environmental problems and
will require rural communities to devote a larger
percentage of their resources to these efforts;
(10) many public water systems serving rural
communities are inadequate or insufficient to pro-
vide for existing and future needs and have deterio-
rated to the degree that a reliable supply of water
is in jeopardy and large quantities of water are
being wasted or may be wasted;
(11) the National Council on Public Works Im-
provement recently concluded that a ‘‘national prob-
lem does exist for small water systems . . . and . . .
these small water systems operate on a marginal
basis, with inadequate financial resources to correct
existing deficiencies . . .’’;
(12) the Environmental Protection Agency has
reported that small water systems serve 8 percent of
the United States population, but account for more
than 90 percent of the violations of the Safe Drink-
ing Water Act;
(13) the Environmental Protection Agency has
reported that 80 percent of the communities in vio-
lation of sewage treatment requirements are rural
communities and that rural community sewage
treatment needs exceed $28,000,000,000;
(14) it is essential that the Federal Government
play a more active role in providing financial assist-
ance to rural communities for the construction of
wastewater treatment works and public water sys-
tems;
(15) it is essential that the Federal Government
make a special effort to provide financial assistance,
including grant assistance, to rural communities
which are economically disadvantaged; and
(16) it is essential that the Federal Government
expand and strengthen technical assistance and out-
reach programs to assist rural communities in com-
plying with environmental requirements and the con-
struction, operation, maintenance, and rehabilitation
of wastewater treatment works and public water sys-
tems.
SEC. 3. PURPOSES.
The purposes of this Act are—
(1) to assist economically distressed rural com-
munities in financing the planning and construction
of wastewater treatment works and public water sys-
tems; and
(2) to expand and strengthen programs for pro-
viding technical assistance to economically distressed
rural communities on issues relating to operation,
management, and maintenance of wastewater treat-
ment works and public water systems.
SEC. 4. AUTHORIZATION OF APPROPRIATIONS.
Section 607 of the Federal Water Pollution Control
Act (33 U.S.C. 1387) is amended—
(1) by striking ‘‘and’’ at the end of paragraph
(4); and
(2) by striking paragraph (5) and inserting the
following new paragraphs:
‘‘(5) $2,000,000,000 for fiscal year 1994;
‘‘(6) $2,300,000,000 for fiscal year 1995;
‘‘(7) $2,700,000,000 for fiscal year 1996;
‘‘(8) $3,000,000,000 for fiscal year 1997;
‘‘(9) $3,500,000,000 for fiscal year 1998; and
‘‘(10) $4,000,000,000 per fiscal year for each
of fiscal years 1999 and 2000.’’.
SEC. 5. ASSISTANCE FOR ECONOMICALLY DISTRESSED
RURAL COMMUNITIES.
(a) CAPITALIZATION GRANT AGREEMENTS.—Section
602(b) of the Federal Water Pollution Control Act (33
U.S.C. 1382(b)) is amended—
(1) by striking ‘‘and’’ at the end of paragraph
(9);
(2) by striking the period at the end of para-
graph (10) and inserting ‘‘; and’’; and
(3) by adding after paragraph (10) the follow-
ing new paragraph:
‘‘(11) the State will comply with the require-
ments of part B of this title.’’.
(b) RURAL COMMUNITY ENVIRONMENTAL ASSIST-
ANCE ACCOUNT.—
(1) IN GENERAL.—Title VI of such Act (33
U.S.C. 1382–1387) is amended by adding at the end
the following:
‘‘PART B—ASSISTANCE FOR ECONOMICALLY
DISTRESSED RURAL COMMUNITIES
‘‘SEC. 651. ESTABLISHMENT OF RURAL COMMUNITY ENVI-
RONMENTAL ASSISTANCE ACCOUNTS.
‘‘(a) IN GENERAL.—Each State shall establish a
rural community environmental assistance account in the
water pollution control revolving loan fund established by
the State pursuant to this title.
‘‘(b) DEPOSITS.—
‘‘(1) IN GENERAL.—The rural community envi-
ronmental assistance account of a State under this
part shall consist of amounts deposited into the ac-
count in accordance with this subsection, repayments
of principal and interest from loans made with such
amounts, and any interest or other proceeds derived
from such amounts.
‘‘(2) AMOUNTS
FROM
GRANT
PAYMENTS.—A
State shall deposit into the rural community envi-
ronmental assistance account of the State under this
part not less than 25 percent of the amount of each
grant payment received by the State under section
601 after the date of the enactment of this part.
‘‘(3) MATCHING REQUIREMENT.—A State shall
deposit into the rural community environmental as-
sistance account of the State under this part from
State monies an amount equal to at least 5 percent
of the amount deposited into such account under
paragraph (2). Amounts subject to the matching re-
quirement of this paragraph shall not be subject to
any matching requirement under a capitalization
grant agreement entered into under section 602.
‘‘(4) UNOBLIGATED
BALANCE.—A State may
deposit into the rural community environmental as-
sistance account of the State under this part any
portion of the unobligated balance, on the date of
the enactment of this part, of the State’s water pol-
lution control revolving loan fund.
‘‘(c) REQUIREMENTS.—Amounts in the rural commu-
nity environmental assistance account of a State under
this part shall be subject to the requirements of this part
and, except as otherwise provided by this part, shall not
be subject to the requirements of part (A) of this title.
‘‘SEC. 652. RURAL COMMUNITY ENVIRONMENTAL ASSIST-
ANCE ACCOUNT FUNDS.
‘‘(a) PROJECTS ELIGIBLE FOR ASSISTANCE.—Except
as otherwise provided by this part, amounts in the rural
community environmental assistance account of a State
under this part may be used only for projects, which are
included in an intended use plan approved by the Adminis-
trator pursuant to section 653, for the construction of
wastewater treatment works and public water systems in
economically distressed rural communities.
‘‘(b) TYPES OF ASSISTANCE.—Except as otherwise
limited by State law, amounts in the rural community en-
vironmental assistance account of a State under this part
may be used only—
‘‘(1) to make loans to economically distressed
rural communities on the condition that—
‘‘(A) such loans are made at or below mar-
ket interest rates, including interest free loans,
at terms not to exceed 30 years;
‘‘(B) annual principal and interest pay-
ments will commence not later than 3 years
after completion of a project and all loans will
be fully amortized not later than 30 years after
completion of a project;
‘‘(C) the recipient of a loan will establish
a dedicated source of revenue for repayment of
loans; and
‘‘(D) the recipient of a loan agrees to
repay the loan and the account will be credited
with all payments of principal and interest on
the loan;
‘‘(2) to make grants to economically distressed
rural communities on the condition that such grants
do not exceed 75 percent of the costs of eligible
projects or 85 percent of the costs of eligible innova-
tive projects (as such term is used in section
201(g)(5) of this Act);
‘‘(3) as a source of revenue or security for the
payment of principal and interest on revenue or gen-
eral obligation bonds issued by the State if the pro-
ceeds of the sale of such bonds will be deposited in
the account;
‘‘(4) to earn interest on amounts in the ac-
count; and
‘‘(5) to pay the reasonable costs of (A) admin-
istering the account, (B) conducting activities under
this part, and (C) establishing a Rural Environ-
mental Infrastructure Advisory Panel under section
654; except that total of such costs may not exceed
6 percent of the balance of the account.
‘‘(c) ADMINISTRATION.—Amounts in the rural com-
munity environmental assistance account of a State under
this part shall be administered by the same instrumental-
ity which administers other amounts in the State’s water
pollution control revolving loan fund.
‘‘(d) INTEREST
RATES.—Subject to subsection
(b)(1)(A), each State shall establish criteria for determin-
ing the rate of interest to be charged on a loan made with
amounts in the rural community environmental assistance
account of a State under this part. Such criteria shall pro-
vide that a lower rate of interest will be charged on loans
for eligible projects in communities which have lower pop-
ulation levels and lower income levels.
‘‘(e) GRANTS.—Subject to subsection (b)(2), each
State shall establish criteria for determining the amount
of assistance to be provided under this section in the form
of grants for an eligible project. Such criteria shall provide
that a higher percentage of the total cost of the project
will be provided in the form of grants for eligible projects
in communities which have lower population levels and
lower income levels.
‘‘(f) CONSISTENCY
WITH
PLANNING
REQUIRE-
MENTS.—
‘‘(1) WASTEWATER
TREATMENT
WORKS.—A
State may provide financial assistance with amounts
from the rural community environmental assistance
account of the State under this part only with re-
spect to a wastewater treatment works which is con-
sistent with plans, if any, developed under sections
205(j), 208, 303(e), 319, and 320 of this Act.
‘‘(2) PUBLIC WATER SYSTEMS.—A State may
provide financial assistance with amounts from the
rural community environmental assistance account
of the State under this part only with respect to a
public water system which is approved by the chief
executive officer of the State agency with primary
enforcement authority pursuant to section 1413 of
the Safe Drinking Water Act.
‘‘(g) 
PRIORITY.—In 
providing 
assistance 
with
amounts from the rural community environmental assist-
ance account of the State under this part, the State shall
give priority to an economically distressed rural commu-
nity in which—
‘‘(1) there is a documented need for collector
sewers and interceptors in order to improve access
to wastewater treatment facilities;
‘‘(2) residents rely on inadequate individual
wastewater treatment facilities such as outhouses,
failing septic systems, or cesspools that are deter-
mined by public health officials to be a hazard to the
community;
‘‘(3) residents rely on public water systems
which do not meet the requirements of the Safe
Drinking Water Act; or
‘‘(4) residents rely on inadequate individual
drinking water systems such as contaminated wells
that are determined by local public health to be a
hazard to the community.
‘‘(h) INNOVATIVE PROJECTS.—A State may provide
assistance with amounts from the rural community envi-
ronmental assistance account of the State under this part
for eligible innovative projects (as such term is used in
section 201(g)(5) of this Act) only after conducting a cost-
benefit analysis of such project. Such analysis shall in-
clude an evaluation of the long-term operation and mainte-
nance costs associated with the project.
‘‘SEC. 653. INTENDED USE PLAN.
‘‘(a) IN GENERAL.—
‘‘(1) CONTENTS.—Prior to the beginning of
each fiscal year, each State shall prepare and submit
to the Administrator a plan, approved by the State’s
Rural Environmental Infrastructure Advisory Panel
under section 654, identifying the intended uses of
the amounts available to the rural community envi-
ronmental assistance account of the State under this
part. Such intended use plan shall include, but not
be limited to—
‘‘(A) a list of those projects for construc-
tion of wastewater treatment works and public
water systems which are pending;
‘‘(B) a description of the short- and long-
term goals and objectives of the account;
‘‘(C) information on the activities to be
supported, including a description of project
categories, terms of financial assistance, and
economically 
distressed 
rural 
communities
served;
‘‘(D) assurances and specific proposals to
ensure that all funds in the account will be ex-
pended in an expeditious and timely manner;
‘‘(E) the criteria and method established
for the allocation of funds to proposed projects;
‘‘(F) the criteria established for determin-
ing the interest rate on loans made with
amounts from the account; and
‘‘(G) the criteria established for determin-
ing the amount of assistance to be provided
under this section in the form of grants for an
eligible project.
‘‘(2) REVIEW.—The Administrator shall review
each plan developed pursuant to this subsection for
a fiscal year and shall approve or disapprove such
plan.
‘‘(3) PUBLIC
REVIEW
AND
COMMENT.—The
State shall provide for public review and comment
on the plan developed pursuant to this section.
‘‘(b) RESERVATION
OF FUNDS
FOR PLANNING.—
Each State shall reserve each fiscal year 1 percent of the
sums in the rural community environmental assistance ac-
count of the State under this part to carry out planning
and related activities pursuant to this section.
‘‘SEC. 654. RURAL ENVIRONMENTAL INFRASTRUCTURE AD-
VISORY PANEL.
‘‘(a) IN GENERAL.—A State may submit an intended
use plan to the Administrator under section 653 only if
such plan has been approved by a Rural Environmental
Infrastructure Advisory Panel which has been established
by the State in accordance with this section.
‘‘(b) DUTIES.—It shall be the duty of a panel estab-
lished under this section in a fiscal year—
‘‘(1) to develop goals and guidance to assist the
State in the preparation of the State’s intended use
plan under section 653 for such fiscal year; and
‘‘(5) One individual who is a representative of
the State agency which is primarily responsible for
regulating private utilities.
‘‘(6) One individual who is a representative of
a regional planning agency.
‘‘(7) On individual who is a representative of
the Rural Community Assistance Program.
‘‘(8) One individual who is a representative of
the State’s Rural Water Association.
‘‘(9) One individual who is a representative of
a local government.
‘‘(10) One individual who is a representative of
local or county health department or agency.
‘‘(d) TERM.—Each member shall be appointed for a
term of 2 years.
‘‘(e) VACANCIES.—A vacancy on a panel established
under this section shall be filled in the manner in which
the original appointment was made.
‘‘(f) PAY.—Members shall serve without pay but may
receive travel expenses.
‘‘(g) CHAIRPERSON.—The chairperson of a panel es-
tablished under this section shall be elected by the mem-
bers.
‘‘(h) MEETINGS.—A panel established under this sec-
tion shall conduct at least 3 meetings during each fiscal
year.
‘‘SEC. 655. AUDITS, REPORTS, AND FISCAL CONTROLS.
‘‘(a) FISCAL
CONTROL
AND
AUDITING
PROCE-
DURES.—Each State shall establish fiscal controls and ac-
counting procedures sufficient to ensure proper accounting
during appropriate accounting periods for—
‘‘(1) deposits made into the rural community
environmental assistance account of the State under
this part;
‘‘(2) disbursements made from the account; and
‘‘(3) account balances at the beginning and end
of the accounting period.
‘‘(b) ANNUAL FEDERAL AUDITS.—The Adminis-
trator shall, at least on an annual basis, conduct or require
each State to have independently conducted such reviews
and audits as may be deemed necessary or appropriate
by the Administrator to carry out the objectives of this
section. Audits of the use of funds deposited in the rural
community environmental assistance account of the State
shall be conducted in accordance with the auditing proce-
dures of the General Accounting Office, including chapter
75 of title 31, United States Code.
‘‘(c) ANNUAL REPORT.—Beginning 60 days after the
end of the first fiscal year beginning after the date of the
enactment of this part, the State shall submit an annual
report to the Administrator describing how the State has
met the goals and objectives for the previous fiscal year
as identified in the plan prepared for such year pursuant
to section 653(a), including identification of loan and
grant recipients, loan and grant amounts, and terms and
similar details on other forms of financial assistance pro-
vided from the rural community environmental assistance
account of the State under this part.
‘‘(d) NONCOMPLIANCE.—
‘‘(1) NOTIFICATION.—If the Administrator de-
termines that a State has not complied with the re-
quirements of this part, the Administrator shall no-
tify the State of such noncompliance and the nec-
essary corrective action.
‘‘(2) WITHHOLDING OF PAYMENTS.—If a State
does not take corrective action within 60 days after
the date a State receives notification of noncompli-
ance under paragraph (1), the Administrator shall
withhold the minimum amounts to be deposited in
the rural community environmental assistance ac-
count of the State under this part until the Adminis-
trator is satisfied that the State has taken the nec-
essary corrective action.
‘‘(3) REALLOTMENT.—If the Administrator is
not satisfied that adequate correction actions have
been taken by the State on or before the date which
is 12 months after the date on which the State is
notified of noncompliance, the payments withheld
from the State by the Administrator under section
(2) shall be made available for reallotment in accord-
ance with the formula for allotment of funds under
this Act.
‘‘SEC. 656. DEFINITIONS.
‘‘For the purposes of this part, the following defini-
tions apply:
‘‘(1) CONSTRUCTION.—The term ‘construction’
shall have the same meaning as such term has under
section 212(1) of this Act; except that such term
shall be construed to apply to public water systems
as well as wastewater treatment works and such
term shall include acquisition of lands, easements,
and rights-of-way for use as a site on which to locate
a public water system or wastewater treatment
works.
‘‘(2) ECONOMICALLY DISTRESSED RURAL COM-
MUNITY.—The term ‘economically distressed rural
community’ means a rural community in which—
‘‘(A) the median household income of the
residents of such community is less than 75
percent of the statewide non-metropolitan
household income, as determined by the latest
decennial census of the United States; or
‘‘(B) the rate of poverty for the residents
of such community is greater than the national
poverty rate, as determined annually by the Of-
fice of Management and Budget.
‘‘(3) PUBLIC WATER SYSTEM.—The term ‘pub-
lic water system’ shall have the same meaning as
such term has under section 1401(4) of the Safe
Drinking Water Act.
‘‘(4) RURAL
COMMUNITY.—The term ‘rural
community’ means a municipality—
‘‘(A) which is located in a non-metropoli-
tan county and which has a population of 5,000
individuals or less, as determined by the latest
decennial census of the United States; or
‘‘(B) the wastewater treatment works or
drinking water facility for which assistance is
sought has fewer then 1,000 service connec-
tions.
‘‘(5) WASTEWATER TREATMENT WORKS.—The
term ‘wastewater treatment works’ shall have the
same meaning as the term ‘treatment works’ has
under section 212(2) of this Act.’’.
(2) CONFORMING
AMENDMENT.—Title VI of
such Act is further amended by inserting after the
heading for such title the following:
‘‘PART A—GENERAL FUNDS’’.
SEC. 6. TECHNICAL ASSISTANCE FOR ECONOMICALLY DIS-
TRESSED RURAL COMMUNITIES.
(a) GRANTS.—The Administrator of the Environ-
mental Protection Agency shall make grants to appro-
priate regional, State, and local agencies and not-for-profit
organizations to assist economically distressed rural com-
munities (as defined in part B of the Federal Water Pollu-
tion Control Act) by providing technical assistance for the
financing, operation, management, and maintenance of
wastewater treatment works and public water systems.
(b) ELIGIBILITY.—The Administrator shall make
grants under subsection (a) only to those regional, State,
and local agencies and not-for-profit organizations which
have an established record for providing technical assist-
ance to economically distressed rural communities.
(5) providing assistance to develop long-term fi-
nancial strategies to address overall water quality
needs.
(d) FUNDING.—The Administrator shall set aside for
fiscal year 1994, and each fiscal year thereafter, for mak-
ing grants under this section not to exceed 1.5 percent
of the amounts appropriated in such fiscal year pursuant
to section 607 of the Federal Water Pollution Control Act.
SEC. 7. REPORT TO CONGRESS.
(a) IN GENERAL.—The first sentence of section
516(b)(1) of the Federal Water Pollution Control Act is
amended—
(1) by striking ‘‘; and (D)’’ and inserting ‘‘;
(D)’’; and
(2) by inserting before the period at the end the
following: ‘‘; (E) an estimate of the costs of rehabili-
tating, replacing, and upgrading public water sys-
tems nationally and by State; (F) an estimate of the
costs of construction of expanded or new publicly
owned treatment works and public water systems
nationally and by State, including an estimate of the
portion of such costs associated with meeting the re-
quirements of this Act; (G) an estimate of the per-
centage of the costs described in subparagraphs (B),
(C), (D), (E), and (F) associated with publicly
owned treatment works and public water systems
serving economically distressed rural communities as
defined under section 656 of this Act.’’.
(b) APPLICABILITY.—The amendment made by sub-
section (a) shall only apply to reports required under sec-
tion 516(b)(1) of the Federal Water Pollution Control Act
after the date of the enactment of this Act.
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