II 118th CONGRESS 1st Session S. 938 IN THE SENATE OF THE UNITED STATES March 22, 2023 Mr. Sanders (for himself, Mr. Wyden , Mr. Blumenthal , Mr. Merkley , Ms. Warren , and Mr. Welch ) introduced the following bill; which was read twice and referred to the Committee on Finance A BILL To establish a trust fund to provide for adequate funding for water and sewer infrastructure, and for other purposes.

1. Short title; table of contents (a) Short title This Act may be cited as the Water Affordability, Transparency, Equity, and Reliability Act of 2023 . (b) Table of contents The table of contents for this Act is as follows: Sec. 1. Short title; table of contents. Sec. 2. Definition of Administrator. Sec. 3. Water Affordability, Transparency, Equity, and Reliability Trust Fund. Sec. 4. Report on affordability, discrimination and civil rights violations, public participation in regionalization, and data collection. Sec. 5. Household water well systems. Sec. 6. Use of State revolving funds under the Federal Water Pollution Control Act. Sec. 7. Use of State revolving loan funds under the Safe Drinking Water Act. Sec. 8. Drinking water grant programs. Sec. 9. Labor provisions. Sec. 10. Drinking water assistance to colonias. 2. Definition of Administrator In this Act, the term Administrator means the Administrator of the Environmental Protection Agency. 3. Water Affordability, Transparency, Equity, and Reliability Trust Fund (a) Establishment (1) In general Subchapter A of chapter 98 of the Internal Revenue Code of 1986 is amended by adding at the end the following: 9512. Water Affordability, Transparency, Equity, and Reliability Trust Fund (a) Creation of trust fund There is established in the Treasury of the United States a trust fund to be known as the Water Affordability, Transparency, Equity, and Reliability Trust Fund (referred to in this section as the Trust Fund ), consisting of such amounts as may be appropriated or credited to such Trust Fund as provided in this section or section 9602(b). (b) Transfers to fund (1) In general There are hereby appropriated to the Trust Fund such amounts as the Secretary from time to time estimates are equal to the increase in Federal revenues attributable to the amendment made by section 3(b) of the Water Affordability, Transparency, Equity, and Reliability Act of 2023 . (2) Limitation The sum of the amounts appropriated under paragraph (1) during any fiscal year shall not exceed the larger of— (A) $35,000,000,000, and (B) one-twentieth of the sum of— (i) the 20-year need identified in the most recent assessment conducted by the Administrator of the Environmental Protection Agency in accordance with section 1452(h) of the Safe Drinking Water Act ( 42 U.S.C. 300j–12(h) ), plus (ii) the 20-year need identified in the most recent needs survey submitted by the Administrator pursuant to sections 205(a), 516, and 609 of the Federal Water Pollution Control Act ( 33 U.S.C. 1285(a) , 1375, 1389). (c) Expenditures Amounts in the Trust Fund are available, without further appropriation and without fiscal year limitation, for the purposes described in section 3(c) of the Water Affordability, Transparency, Equity, and Reliability Act of 2023 . . (2) Clerical amendment The table of parts for subchapter A of chapter 98 of such Code is amended by inserting after the item relating to section 9511 the following new item: Sec. 9512. Water Affordability, Transparency, Equity, and Reliability Trust Fund. . (b) Increase in corporate tax rate (1) In general Section 11(b) of the Internal Revenue Code of 1986 is amended by striking 21 and inserting 24.5 . (2) Effective date The amendment made by this subsection shall apply to taxable years beginning after December 31, 2022. (c) Allocation of funds The Administrator, the Secretary of Agriculture, and the Secretary of Health and Human Services shall allocate, for a fiscal year, the amount available, at the beginning of that fiscal year, in the Water Affordability, Transparency, Equity, and Reliability Trust Fund established by section 9512(a) of the Internal Revenue Code of 1986, as follows: (1) Clean water programs Of that amount, the Administrator shall use— (A) 0.5 percent for making grants under section 104(b)(8) of the Federal Water Pollution Control Act ( 33 U.S.C. 1254(b)(8) ); (B) 1.5 percent for making grants under section 106 of that Act ( 33 U.S.C. 1256 ); (C) 2.5 percent for making grants under section 226 of that Act ( 33 U.S.C. 1302d ); (D) 2.5 percent for making grants under subsections (h) and (i) of section 319 of that Act ( 33 U.S.C. 1329 ); and (E) 42.25 percent for making capitalization grants under title VI of that Act ( 33 U.S.C. 1381 et seq. ). (2) Safe drinking water funding Of that amount, the Administrator shall use— (A) 0.5 percent for providing technical assistance under section 1442(e) of the Safe Drinking Water Act ( 42 U.S.C. 300j–1(e) ); (B) 42.25 percent for making capitalization grants under section 1452 of that Act ( 42 U.S.C. 300j–12 ); (C) 3 percent for making grants under section 1465 of that Act ( 42 U.S.C. 300j–25 ); and (D) 0.5 percent for making grants under section 1456 of that Act ( 42 U.S.C. 300j–16 ) and for making grants under section 307 of the Safe Drinking Water Act Amendments of 1996 ( 33 U.S.C. 1281 note; Public Law 104–182 ). (3) Household water well systems Of that amount, the Secretary of Agriculture shall use 1 percent for making grants under section 306E of the Consolidated Farm and Rural Development Act ( 7 U.S.C. 1926e ). (4) Colonias Of that amount, the Secretary of Agriculture shall use 0.5 percent for making grants under section 306C of the Consolidated Farm and Rural Development Act ( 7 U.S.C. 1926c ) to entities described in subsection (c) of that section. (5) Indian health service Of that amount, the Secretary of Health and Human Services, acting through the Director of the Indian Health Service, shall use 3 percent for making grants for the planning, design, construction, modernization, improvement, and renovation of water, sewer, and solid waste sanitation facilities that are funded, in whole or part, by the Indian Health Service— (A) through, or provided for in, a contract or compact with the Indian Health Service under the Indian Self-Determination and Education Assistance Act ( 25 U.S.C. 5301 et seq. ); (B) pursuant to section 7 of the Act of August 5, 1954 (68 Stat. 674, chapter 658; 42 U.S.C. 2004a ); or (C) pursuant to section 302 of the Indian Health Care Improvement Act ( 25 U.S.C. 1632 ). (d) Prohibition None of the funds allocated pursuant to subsection (c) may be used for any activity described in paragraphs (1) through (5) of section 203(a) of the Labor-Management Reporting and Disclosure Act of 1959 ( 29 U.S.C. 433(a) ). 4. Report on affordability, discrimination and civil rights violations, public participation in regionalization, and data collection (a) Study (1) In general The Administrator shall conduct a study on water and sewer services in accordance with this subsection. (2) Affordability In conducting the study under paragraph (1), the Administrator shall study water affordability across the United States, including— (A) rates for water and sewer services, increases in those rates during the 10-year period preceding the study, and water service disconnections due to unpaid water service charges; and (B) the effectiveness of funding under section 1452 of the Safe Drinking Water Act ( 42 U.S.C. 300j–12 ) and under title VI of the Federal Water Pollution Control Act ( 33 U.S.C. 1381 et seq. ) for promoting affordable, equitable, transparent, and reliable water and sewer service. (3) Discrimination and civil rights In conducting the study under paragraph (1), the Administrator, in collaboration with the Civil Rights Division of the Department of Justice, shall study— (A) discriminatory practices of water and sewer service providers; (B) discriminatory practices of State program administrators in allocating funding; and (C) violations by those service providers and program administrators that receive Federal assistance of civil rights under title VI of the Civil Rights Act of 1964 ( 42 U.S.C. 2000d et seq. ) with respect to equal access to water and sewer services. (4) Public participation in regionalization In conducting the study under paragraph (1), the Administrator shall evaluate efforts to regionalize public water systems (as defined in section 1401 of the Safe Water Drinking Act ( 42 U.S.C. 300f )) and sewer services with respect to public participation in— (A) the decision to undergo that regionalization; and (B) decisionmaking by the board of directors (or other governing body) of the entity that provides, or oversees or coordinates the provision of, water by the public water systems subject to such regionalization. (5) Data collection In conducting the study under paragraph (1), the Administrator shall collect information, assess the availability of information, and evaluate the methodologies used to collect information with respect to— (A) people living without water or sewer services; (B) water service disconnections due to unpaid water service charges, including disconnections experienced by households containing children, elderly persons, disabled persons, chronically ill persons, or other vulnerable populations; (C) tax liens and foreclosures due to unpaid water service charges; and (D) disparate effects, on the basis of race, gender, or socioeconomic status, of water service disconnections, tax liens and foreclosures due to unpaid water service charges, and the lack of public water service. (b) Report Not later than 1 year after the date of enactment of this Act, the Administrator shall submit to Congress a report that contains— (1) the results of the study conducted under subsection (a)(1); and (2) recommendations for utility companies, Federal agencies, and States relating to those results. 5. Household water well systems Section 306E(d) of the Consolidated Farm and Rural Development Act ( 7 U.S.C. 1926e(d) ) is amended by striking $20,000,000 for each of fiscal years 2019 through 2023 and inserting $348,500,000 for each fiscal year . 6. Use of State revolving funds under the Federal Water Pollution Control Act (a) Specific requirements Section 602(b) of the Federal Water Pollution Control Act ( 33 U.S.C. 1382(b) ) is amended— (1) in paragraph (2), by striking which will be made to the State with funds to be made available and inserting that were made to the State with funds made available for fiscal year 2021 ; (2) in paragraph (13)(B)(iii), by striking and at the end; (3) in paragraph (14), by striking the period at the end and inserting a semicolon; and (4) by adding at the end the following: (15) the State will not provide financial assistance using amounts from the fund for any project that will provide substantial direct benefits to new communities, lots, or subdivisions, other than a project to construct an advanced decentralized wastewater system; and . (b) Projects and activities eligible for assistance Section 603(c) of the Federal Water Pollution Control Act ( 33 U.S.C. 1383(c) ) is amended— (1) in paragraph (11)(B), by striking and at the end; (2) in paragraph (12)(B), by striking the period at the end and inserting ; and ; and (3) by adding at the end the following: (13) to any municipality or intermunicipal, interstate, or State agency for— (A) purchasing from a willing or unwilling seller a privately owned treatment works; and (B) expenses related to canceling a contract for the operation or management of a publicly owned treatment works. . (c) Increasing the amount of additional subsidization by the State Section 603(i)(3) of the Federal Water Pollution Control Act ( 33 U.S.C. 1383(i)(3) ) is amended by striking subparagraph (B) and inserting the following: (B) Requirement To the extent that there are sufficient applications, a State shall use not less than 50 percent of the total amount received by the State in capitalization grants under this title for a fiscal year for providing additional subsidization under this subsection. . 7. Use of State revolving loan funds under the Safe Drinking Water Act Section 1452 of the Safe Drinking Water Act ( 42 U.S.C. 300j–12 ) is amended— (1) in subsection (a)— (A) in paragraph (2)— (i) in subparagraph (A), by inserting publicly owned, operated, and managed before community water systems ; and (ii) by striking subparagraph (E) and inserting the following: (E) Acquisition of privately owned community water systems The funds under this section may be used— (i) to purchase from a willing or unwilling seller a privately owned community water system; and (ii) for expenses related to canceling a contract for the operation or management of a community water system. ; and (B) by adding at the end the following: (6) Exception to public ownership, operation, and management requirement Notwithstanding paragraph (2)(A), public water systems that regularly serve fewer than 10,000 persons and which are not owned, operated, or managed by any person who owns, operates, or manages any other public water system may receive assistance under this section. ; (2) in subsection (d), by striking paragraph (2) and inserting the following: (2) Requirement To the extent that there are sufficient applications for loans to communities described in paragraph (1), of the amount of the capitalization grant received by a State in a fiscal year, the total amount of loan subsidies made by the State in the fiscal year pursuant to paragraph (1) may not be less than 50 percent. ; (3) in subsection (e), by striking to be made to the State and inserting that was made to the State in fiscal year 2021 ; (4) in subsection (g)(3)— (A) by redesignating subparagraphs (A) through (C) as clauses (i) through (iii), respectively, and indenting appropriately; (B) in the undesignated matter following clause (iii) (as so redesignated), by striking The guidance and regulations shall also and inserting the following: (B) Generally accepted accounting standards The guidance and regulations required under subparagraph (A) shall ; (C) in the matter preceding clause (i) (as so redesignated), by striking The Administrator and inserting the following: (A) In general The Administrator ; and (D) in subparagraph (A) (as so designated)— (i) in clause (ii) (as so redesignated), by striking and at the end; (ii) in clause (iii) (as so redesignated), by striking the period at the end and inserting ; and ; and (iii) by inserting after clause (iii) the following: (iv) guidance to ensure affordable, equitable, transparent and reliable water service provision, to provide protections for households facing service disconnection due to unpaid water service charges, and to promote universal equal access to water services. ; and (5) in subsection (k)(1), by adding at the end the following: (E) Provide assistance in the form of a grant to owners of private property on which a lead service line (as defined in section 1459B(a)) is or may be located, for the purpose of replacing the lead service line with a service line that is lead free (as defined in section 1417(d)). (F) Provide assistance to a publicly owned, operated, and managed community water system for the purpose of updating treatment plants or switching water sources due to contamination from a perfluoroalkyl or polyfluoroalkyl substance (as defined by the State in which the community water system is located). (G) Provide assistance in the form of a grant to owners of a household water well that has been contaminated by a perfluoroalkyl or polyfluoroalkyl substance (as defined by the State in which the household well is located) for the purpose of purchasing and installing a household filtration system. . 8. Drinking water grant programs (a) School drinking water improvement Section 1465 of the Safe Drinking Water Act ( 42 U.S.C. 300j–25 ) is amended— (1) in the section heading, by striking fountain and inserting infrastructure ; (2) in subsection (a), by striking fountains manufactured prior to 1988 and inserting infrastructure ; (3) by striking subsection (b) and inserting the following: (b) Use of funds Funds awarded under the grant program may be used to pay costs associated with— (1) installing, repairing, or replacing the infrastructure necessary to ensure that drinking water fountains, drinking water coolers, and bottle filling stations at schools are lead free (as defined in section 1417(d)); and (2) monitoring and reporting of lead levels in the drinking water of schools, as determined appropriate by the Administrator. ; and (4) in subsection (d)— (A) by striking $5,000,000 and inserting $1,050,000,000 ; and (B) by striking 2019 through 2021 and inserting 2024 and 2025 . (b) Tribal drinking water Section 1452(i)(1) of the Safe Drinking Water Act ( 42 U.S.C. 300j–12(i)(1) ) is amended, in the first sentence— (1) by striking 1 1/2 and inserting 3 ; and (2) by striking may and inserting shall . 9. Labor provisions (a) Prevailing rate of wage Nothing in this Act or an amendment made by this Act shall affect the applicability of the requirements relating to labor standards of sections 513 and 602(b)(6) of the Federal Water Pollution Control Act ( 33 U.S.C. 1372 , 1382(b)(6)) and section 1450(e) of the Safe Drinking Water Act ( 42 U.S.C. 300j–9(e) ) to projects carried out under those Acts. (b) Project labor agreements (1) Clean water revolving funds Section 602(b) of the Federal Water Pollution Control Act ( 33 U.S.C. 1382(b) ) (as amended by section 6(a)), is amended by adding at the end the following: (16) the State will— (A) permit recipients of assistance under this title to enter into agreements authorized under section 8(f) of the National Labor Relations Act ( 29 U.S.C. 158(f) ) (commonly known as project labor agreements ) with respect to projects for building or construction carried out with that assistance; and (B) ensure that, to the maximum extent practicable, recipients of assistance under this title carry out those projects through the use of those agreements. . (2) Drinking water revolving funds Section 1452 of the Safe Drinking Water Act ( 42 U.S.C. 300j–12 ) is amended— (A) in subsection (a) (as amended by section 7(1)(B)), by adding at the end the following: (7) Project labor agreements Each agreement under this subsection shall require that the State permit recipients of assistance under this section to enter into agreements authorized under section 8(f) of the National Labor Relations Act ( 29 U.S.C. 158(f) ) (commonly known as project labor agreements ) with respect to projects for building or construction carried out with that assistance. ; and (B) in subsection (b)(3)(A)— (i) in clause (ii), by striking and at the end; (ii) in clause (iii), by striking the period at the end and inserting ; and ; and (iii) by adding at the end the following: (iv) with respect to projects for building or construction, will be carried out through the use of agreements authorized under section 8(f) of the National Labor Relations Act ( 29 U.S.C. 158(f) ) (commonly known as project labor agreements ). . 10. Drinking water assistance to colonias Section 1456 of the Safe Drinking Water Act ( 42 U.S.C. 300j–16 ) is amended— (1) in subsection (a)— (A) by redesignating paragraph (2) as paragraph (3); and (B) by inserting after paragraph (1) the following: (2) Covered entity The term covered entity means each of the following: (A) A border State. (B) A local government with jurisdiction over an eligible community. ; (2) in subsection (b)— (A) by striking of the Environmental Protection Agency ; and (B) by striking border State and inserting covered entity ; (3) by striking subsection (d); (4) by redesignating subsection (e) as subsection (d); and (5) in subsection (d) (as so redesignated)— (A) by striking $25,000,000 and inserting $100,000,000 ; and (B) by striking 1997 through 1999 and inserting 2023 through 2027 .