To authorize the Secretary of the Interior and the Secretary of Agriculture to make grants to improve the commercial value of forest biomass for electric energy, useful heat, transportation fuels, petroleum-based product substitutes, and other commercial purposes.

SECTION 1. GRANTS TO IMPROVE THE COMMERCIAL VALUE OF FOREST BIOMASS FOR 
              ELECTRIC ENERGY, USEFUL HEAT, TRANSPORTATION FUELS, 
              PETROLEUM-BASED PRODUCT SUBSTITUTES, AND OTHER COMMERCIAL 
              PURPOSES.

    (a) Findings.--Congress finds the following:
            (1) Thousands of communities in the United States, many 
        located near Federal lands, are at risk to wildfire. 
        Approximately 190,000,000 acres of land managed by the 
        Secretary of Agriculture and the Secretary of the Interior are 
        at risk of catastrophic fire in the near future. The 
        accumulation of heavy forest fuel loads continues to increase 
        as a result of disease, insect infestations, and drought, 
        further raising the risk of fire each year.
            (2) In addition, more than 70,000,000 acres across all land 
        ownerships are at risk to higher than normal mortality over the 
        next 15 years from insect infestation and disease. High levels 
        of tree mortality from insects and disease result in increased 
        fire risk, loss of old growth, degraded watershed conditions, 
        and changes in species diversity and productivity, as well as 
        diminished fish and wildlife habitat and decreased timber 
        values.
            (3) Preventive treatments such as removing fuel loading, 
        ladder fuels, and hazard trees, planting proper species mix and 
        restoring and protecting early successional habitat, and other 
        specific restoration treatments designed to reduce the 
        susceptibility of forest land, woodland, and rangeland to 
        insect outbreaks, disease, and catastrophic fire present the 
        greatest opportunity for long-term forest health by creating a 
        mosaic of species-mix and age distribution. Such prevention 
        treatments are widely acknowledged to be more successful and 
        cost effective than suppression treatments in the case of 
        insects, disease, and fire.
            (4) The by-products of preventive treatment (wood, brush, 
        thinnings, chips, slash, and other hazardous fuels) removed 
        from forest lands, woodlands and rangelands represent an 
        abundant supply of biomass for biomass-to-energy facilities and 
        raw material for business. There are currently few markets for 
        the extraordinary volumes of by-products being generated as a 
        result of the necessary large-scale preventive treatment 
        activities.
            (5) The United States should--
                    (A) promote economic and entrepreneurial 
                opportunities in using by-products removed through 
                preventive treatment activities related to hazardous 
                fuels reduction, disease, and insect infestation; and
                    (B) develop and expand markets for traditionally 
                underused wood and biomass as an outlet for by-products 
                of preventive treatment activities.
    (b) Definitions.--In this section:
            (1) Biomass.--The term ``biomass'' means trees and woody 
        plants, including limbs, tops, needles, and other woody parts, 
        and by-products of preventive treatment, such as wood, brush, 
        thinnings, chips, and slash, that are removed--
                    (A) to reduce hazardous fuels; or
                    (B) to reduce the risk of or to contain disease or 
                insect infestation.
            (2) Indian tribe.--The term ``Indian tribe'' has the 
        meaning given the term in section 4(e) of the Indian Self-
        Determination and Education Assistance Act (25 U.S.C. 450b(e)).
            (3) Person.--The term ``person'' includes--
                    (A) an individual;
                    (B) a community (as determined by the Secretary 
                concerned);
                    (C) an Indian tribe;
                    (D) a small business, micro-business, or a 
                corporation that is incorporated in the United States; 
                and
                    (E) a nonprofit organization.
            (4) Preferred community.--The term ``preferred community'' 
        means--
                    (A) any town, township, municipality, or other 
                similar unit of local government (as determined by the 
                Secretary concerned) that--
                            (i) has a population of not more than 
                        50,000 individuals; and
                            (ii) the Secretary concerned, in the sole 
                        discretion of the Secretary concerned, 
                        determines contains or is located near land, 
                        the condition of which is at significant risk 
                        of catastrophic wildfire, disease, or insect 
                        infestation or which suffers from disease or 
                        insect infestation; or
                    (B) any county that--
                            (i) is not contained within a metropolitan 
                        statistical area; and
                            (ii) the Secretary concerned, in the sole 
                        discretion of the Secretary concerned, 
                        determines contains or is located near land, 
                        the condition of which is at significant risk 
                        of catastrophic wildfire, disease, or insect 
                        infestation or which suffers from disease or 
                        insect infestation.
            (5) Secretary concerned.--The term ``Secretary concerned'' 
        means--
                    (A) the Secretary of Agriculture with respect to 
                National Forest System lands; and
                    (B) the Secretary of the Interior with respect to 
                Federal lands under the jurisdiction of the Secretary 
                of the Interior and Indian lands.
    (c) Biomass Commercial Use Grant Program.--
            (1) In general.--The Secretary concerned may make grants to 
        any person that owns or operates a facility that uses biomass 
        as a raw material to produce electric energy, sensible heat, 
        transportation fuels, or substitutes for petroleum-based 
        products to offset the costs incurred to purchase biomass for 
        use by such facility.
            (2) Grant amounts.--A grant under this subsection may not 
        exceed $20 per green ton of biomass delivered.
            (3) Monitoring of grant recipient activities.--As a 
        condition of a grant under this subsection, the grant recipient 
        shall keep such records as the Secretary concerned may require 
        to fully and correctly disclose the use of the grant funds and 
        all transactions involved in the purchase of biomass. Upon 
        notice by a representative of the Secretary concerned, the 
        grant recipient shall afford the representative reasonable 
        access to the facility that purchases or uses biomass and an 
        opportunity to examine the inventory and records of the 
        facility.
    (d) Improved Biomass Use Grant Program.--
            (1) In general.--The Secretary concerned may make grants to 
        persons to offset the cost of projects to develop or research 
        opportunities to improve the use of, or add value to, biomass. 
        In making such grants, the Secretary concerned shall give 
        preference to persons in preferred communities.
            (2) Selection.--The Secretary concerned shall select a 
        grant recipient under paragraph (1) after giving consideration 
        to the anticipated public benefits of the project, including 
        the potential to develop thermal or electric energy resources 
        or affordable energy, opportunities for the creation or 
        expansion of small businesses and micro-businesses, and the 
        potential for new job creation.
            (3) Grant amount.--A grant under this subsection may not 
        exceed $100,000.
    (e) Authorization of Appropriations.--There is authorized to be 
appropriated $50,000,000 for each of the fiscal years 2004 through 2014 
to carry out this section.
    (f) Report.--Not later than October 1, 2010, the Secretary of 
Agriculture, in consultation with the Secretary of the Interior, shall 
submit to the Committee on Energy and Natural Resources and the 
Committee on Agriculture, Nutrition, and Forestry of the Senate and the 
Committee on Resources and the Committee on Agriculture of the House of 
Representatives a report describing the results of the grant programs 
authorized by this section. The report shall include the following:
            (1) An identification of the size, type, and the use of 
        biomass by persons that receive grants under this section.
            (2) The distance between the land from which the biomass 
        was removed and the facility that used the biomass.
            (3) The economic impacts, particularly new job creation, 
        resulting from the grants to and operation of the eligible 
        operations.

Summary: Authorizes the Secretary of Agriculture and the Secretary of the Interior to make grants: (1) to improve the commercial value of forest biomass to produce electric energy, sensible heat, transportation fuels, or substitutes for petroleum-based products; and (2) to develop or research opportunities to improve the use of, or add value to, biomass, with preference given to preferred communities (as defined by this Act).