‘‘(C) with respect to which depreciation (or 
amortization in lieu of depreciation) is allow-
able. 
‘‘(2) DAM SAFETY PROPERTY.—The term ‘dam 
safety property’ means property the purpose of 
which is to maintain or improve dam safety on a 
qualified dam to ensure acceptable performance 
under all loading conditions (static, hydrologic, seis-
mic) in accordance with applicable regulatory cri-
teria and risk guidelines, including— 
‘‘(A) the maintenance or upgrade of spill-
ways or other appurtuant structures, 
‘‘(B) dam stability, including erosion re-
pair and enhanced seepage controls, and 
‘‘(C) upgrades or replacements of flood-
gates or natural infrastructure restoration or 
protection to improve flood risk reduction. 
‘‘(3) ENVIRONMENTAL
IMPROVEMENT
PROP-
ERTY.—The term ‘environmental improvement prop-
erty’ means property the purpose of which is to— 
‘‘(A) add or improve safe and effective fish 
passage, including new or upgraded turbine 
technology, fish ladders, fishways, and all other 
associated technology, equipment, or other fish 
passage technology to a qualified dam, 
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‘‘(B) maintain or improve the quality of 
the water retained or released by a qualified 
dam, 
‘‘(C) promote downstream sediment trans-
port processes and habitat maintenance with re-
spect to a qualified dam, or 
‘‘(D) provide for or improve recreational 
access to the vicinity of a qualified dam, includ-
ing roads, trails, boat ingress and egress, flows 
to improve recreation, and infrastructure that 
improves river recreation opportunity. 
‘‘(4) GRID RESILIENCE PROPERTY.— 
‘‘(A) IN GENERAL.—The term ‘grid resil-
ience property’ means property— 
‘‘(i) the purpose of which is to provide 
the ability of a hydroelectric facility at a 
qualified dam to contribute to electricity 
grid resilience and efficiency by— 
‘‘(I) adapting more quickly to 
changing grid conditions, 
‘‘(II) providing ancillary services 
(including black start capabilities, 
voltage support, and spinning re-
serves), 
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‘‘(III) integrating other variable 
sources of electricity generation, or 
‘‘(IV) managing accumulated res-
ervoir sediments, or 
‘‘(ii) which is a qualified dam de-
scribed in paragraph (5)(B). 
‘‘(B) MITIGATION
AND
ENVIRONMENTAL 
REVIEW REQUIREMENTS.—Such term shall not 
include any property described in subparagraph 
(A)(i) unless any physical or operational 
changes instituted in connection with the activi-
ties described in such subparagraph have been 
authorized under applicable Federal, State, and 
tribal permitting or licensing processes which 
include appropriate mitigation conditions aris-
ing from consultation and environmental review 
under such processes. 
‘‘(5) QUALIFIED
DAM.—The term ‘qualified 
dam’ means any of the following: 
‘‘(A) A hydroelectric dam which is licensed 
by the Federal Energy Regulatory Commission 
or legally operating without such a license and 
was placed in service before the date of the en-
actment of this section. 
‘‘(B) A hydroelectric dam which— 
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‘‘(i) was licensed by the Federal En-
ergy Regulatory Commission before De-
cember 31, 2020, 
‘‘(ii) is under active license from the 
Federal Energy Regulatory Commission on 
the date of enactment of this section, 
‘‘(iii) meets the requirements of sub-
clauses 
(I) 
and 
(III) 
of 
sections 
242(b)(1)(B)(ii) of the Energy Policy Act 
of 2005 (42 U.S.C. 15881), 
‘‘(iv) is placed in service on or after 
the date of the enactment of this section, 
and 
‘‘(v) does not contribute to atmos-
pheric pollution. 
‘‘(C) Any dam which— 
‘‘(i) was placed in service before the 
date of the enactment of this section, 
‘‘(ii) is operated on such date of en-
actment for any beneficial public use ex-
cept hydropower generation, and 
‘‘(iii) is authorized after such date of 
the enactment for hydropower development 
by the Federal Energy Regulatory Com-
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mission, the Bureau of Reclamation, or a 
State, as appropriate. 
‘‘(D) Any dam which was placed in service 
before the date of the enactment of this section 
and which is a qualified nonpowered dam (as 
defined in section 34(e)(3) of the Federal 
Power Act (16 U.S.C. § 823e(e)(3)). 
‘‘(e) ELECTIVE PAYMENT.— 
‘‘(1) IN GENERAL.—In the case of a taxpayer 
making an election (at such time and in such man-
ner as the Secretary may provide) under this sub-
section with respect to any portion of the credit 
which would (without regard to this subsection) be 
determined under this section with respect to such 
taxpayer, such taxpayer shall be treated as making 
a payment against the tax imposed by subtitle A for 
the taxable year equal to 100 percent of such 
amount. 
‘‘(2) TIMING.—The payment described in sub-
section (a) shall be treated as made on the later of 
the due date of the return of tax for such taxable 
year or the date on which such return is filed. 
‘‘(3) DENIAL OF DOUBLE BENEFIT.—Solely for 
purposes of section 38, in the case of a taxpayer 
making an election under this subsection, the credit 
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determined under this section shall be reduced by 
the amount of the portion of such credit with respect 
to which the taxpayer makes such election. 
‘‘(4) APPLICATION
TO
CERTAIN
TAX-EXEMPT 
PERSONS.—In the case of a taxpayer making an 
election under this subsection, the credit subject to 
such an election shall be determined notwith-
standing— 
‘‘(A) section 50(b)(3), and 
‘‘(B) section 50(b)(4), with respect to an 
entity described in section 50(b)(4)(A)(i). 
‘‘(f) SPECIAL RULE FOR PROPERTY FINANCED BY 
SUBSIDIZED
ENERGY
FINANCING
OR
TAX-EXEMPT 
BONDS.—For purposes of this section, rules similar to the 
rules of section 48(a)(4) (determined without regard to 
subparagraph (D) thereof) shall apply.’’. 
(b) CONFORMING AMENDMENTS.— 
(1) Section 46 of the Internal Revenue Code of 
1986 is amended by striking ‘‘and’’ at the end of 
paragraph (5), by striking the period at the end of 
paragraph (6) and inserting ‘‘, and’’, and by adding 
at the end the following new paragraph: 
‘‘(7) the credit for maintaining and enhancing 
hydroelectric dams.’’. 
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(2) Section 49(a)(1)(C) of such Code is amend-
ed by striking ‘‘and’’ at the end of clause (iv), by 
striking the period at the end of clause (v) and in-
serting ‘‘, and’’, and by adding at the end the fol-
lowing new clause: 
‘‘(vi) the basis of any qualified prop-
erty taken into account under section 
48D(d).’’. 
(3) Section 50(a)(2)(E) of such Code is amend-
ed by striking ‘‘or 48C(b)(2)’’ and inserting 
‘‘48C(b)(2), or 48D(c)’’. 
(4) The table of sections for subpart E of part 
IV of subchapter A of chapter 1 of such Code is 
amended by inserting after the item relating to sec-
tion 48C the following new item: 
‘‘Sec. 48D. Credit for maintaining and enhancing hydroelectric dams.’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to property placed in service after 
the date of the enactment of this Act, under rules similar 
to the rules of section 48(m) of the Internal Revenue Code 
of 1986 (as in effect on the day before the date of the 
enactment of the Revenue Reconciliation Act of 1990). 
SEC. 3. CREDIT FOR OBSOLETE RIVER OBSTRUCTION RE-
MOVAL EXPENDITURES. 
(a) IN GENERAL.—Subpart D of part IV of sub-
chapter A of chapter 1 of the Internal Revenue Code of 
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1986 is amended by adding after section 45T the following 
new section: 
‘‘SEC. 45U. CREDIT FOR OBSOLETE RIVER OBSTRUCTION 
REMOVAL EXPENDITURES. 
‘‘(a) IN GENERAL.—For purposes of section 38, the 
credit for obsolete river obstruction removal expenditures 
for any taxable year is 30 percent of the qualified obsolete 
river obstruction removal expenditures incurred during 
such taxable year. 
‘‘(b) QUALIFIED OBSOLETE RIVER OBSTRUCTION 
REMOVAL EXPENDITURES.—For purposes of this sec-
tion— 
‘‘(1) IN GENERAL.—The term ‘qualified obso-
lete river obstruction removal expenditures’ means 
any expenditure to demolish and remove, in whole or 
in part, any dam described in paragraph (2) and its 
associated infrastructure, including all associated re-
mediation and ecosystem restoration costs, so long 
as— 
‘‘(A) the work is performed with the con-
sent of the dam owner, if available, and 
‘‘(B) none of the expenses incurred are 
used to demolish or remove a federally owned 
hydroelectric dam. 
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‘‘(2) DAM DESCRIBED.—A dam is described in 
this paragraph if such dam is— 
‘‘(A) a qualified nonpowered dam (as de-
fined in section 34(e)(3) of the Federal Power 
Act (16 U.S.C. § 823e(e)(3)), or 
‘‘(B) a hydroelectric dam which is not 
owned by the Federal government. 
‘‘(c) APPLICATION TO TAX-EXEMPT ENTITIES.— 
‘‘(1) IN GENERAL.—In the case of qualified ob-
solete river obstruction removal expenditures in-
curred by an eligible entity, the Secretary shall pro-
mulgate regulations to allow the allocation of the 
credit under this section to the person primarily re-
sponsible for designing the property in lieu of the 
owner of such property, with such person to be 
treated as the taxpayer for purposes of this section. 
‘‘(2) ELIGIBLE ENTITY.—For purposes of this 
subsection, the term ‘eligible entity’ means— 
‘‘(A) a Federal, State, or local government 
or a political subdivision thereof, 
‘‘(B) an Indian tribe (as defined in section 
45A(c)(6)), or 
‘‘(C) an organization described in section 
501(c) and exempt from tax under section 
501(a). 
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‘‘(d) ELECTIVE PAYMENT.— 
‘‘(1) IN GENERAL.—In the case of a taxpayer 
making an election (at such time and in such man-
ner as the Secretary may provide) under this sub-
section with respect to any portion of the credit 
which would (without regard to this subsection) be 
determined under this section with respect to such 
taxpayer, such taxpayer shall be treated as making 
a payment against the tax imposed by subtitle A for 
the taxable year equal to 100 percent of such 
amount. 
‘‘(2) TIMING.—The payment described in sub-
section (a) shall be treated as made on the later of 
the due date of the return of tax for such taxable 
year or the date on which such return is filed. 
‘‘(3) DENIAL OF DOUBLE BENEFIT.—Solely for 
purposes of section 38, in the case of a taxpayer 
making an election under this subsection, the credit 
determined under this section shall be reduced by 
the amount of the portion of such credit with respect 
to which the taxpayer makes such election.’’. 
(b) CONFORMING AMENDMENTS.— 
(1) Section 38(b) of the Internal Revenue Code 
of 1986 is amended by striking ‘‘plus’’ at the end of 
paragraph (32), by striking the period at the end of 
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paragraph (33) and inserting ‘‘, plus’’, and by add-
ing at the end the following new paragraph: 
‘‘(34) the credit for obsolete river obstruction 
removal expenditures under section 45U(a).’’. 
(2) Section 280C of such Code is amended by 
adding at the end the following new subsection: 
‘‘(i) CREDIT FOR OBSOLETE RIVER OBSTRUCTION 
REMOVAL EXPENDITURES.—No deduction shall be al-
lowed for that portion of the expenses otherwise allowable 
as a deduction taken into account in determining the cred-
it under section 45U for the taxable year which is equal 
to the amount of the credit determined for such taxable 
year under section 45U(a).’’. 
(3) The table of sections for subpart D of part 
IV of subchapter A of chapter 1 of such Code is 
amended by inserting after the item relating to sec-
tion 45T the following new item: 
‘‘Sec. 45U. Credit for obsolete river obstruction removal expenditures.’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to any obsolete river obstruction 
removal expenditures (as defined in section 45U of the In-
ternal Revenue Code of 1986, as added by this section) 
incurred after the date of the enactment of this Act. 
Æ 
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