II 118th CONGRESS 1st Session S. 3378 IN THE SENATE OF THE UNITED STATES November 30, 2023 Mr. Welch introduced the following bill; which was read twice and referred to the Committee on Agriculture, Nutrition, and Forestry A BILL To amend the Farm Security and Rural Investment Act of 2002 to improve the Rural Energy for America Program, and for other purposes.

1. Short title This Act may be cited as the Rural Energy Equity Act of 2023 . 2. Rural Energy for America Program Section 9007 of the Farm Security and Rural Investment Act of 2002 ( 7 U.S.C. 8107 ) is amended— (1) in subsection (b)— (A) in the subsection heading, by striking Energy audits and renewable energy and inserting Project ; (B) in paragraph (1)— (i) in subparagraph (A), by inserting , including for purposes of reducing the carbon footprint of the agricultural producer and rural small business before the semicolon; and (ii) in subparagraph (B), by inserting , including for purposes of reducing the carbon footprint of the agricultural producer and rural small business before the period at the end; (C) in paragraph (4)— (i) in subparagraph (B), by redesignating clauses (i) and (ii) as subclauses (I) and (II), respectively, and indenting appropriately; (ii) by redesignating subparagraphs (A) and (B) as clauses (i) and (ii), respectively, and indenting appropriately; (iii) in the matter preceding clause (i) (as so redesignated), by striking A recipient and inserting the following: (A) In general A recipient ; and (iv) by adding at the end the following: (B) Multiple activities A recipient of a grant under paragraph (1) may use the grant to carry out 1 or more activities described in subparagraph (A). ; and (D) in paragraph (6)— (i) by striking A recipient and inserting the following: (A) In general A recipient ; and (ii) by adding at the end the following: (B) Underserved producers and businesses If the agricultural producer or rural small business under subparagraph (A) is an underserved agricultural producer or rural small business, the amount paid by that underserved agricultural producer or rural small business pursuant to that subparagraph shall be at least 10 percent of the cost of the energy audit. ; (2) in subsection (c)— (A) in paragraph (3)— (i) in subparagraph (A)— (I) by striking The amount of a grant under this subsection shall not exceed 25 percent and inserting the following: (i) In general Except as provided in clause (ii), the amount of a grant under this subsection shall not exceed 50 percent ; and (II) by adding at the end the following: (ii) Underserved producers The amount of a grant provided under this subsection to an agricultural producer who is a beginning farmer or rancher, a veteran farmer or rancher (as those terms are defined in section 2501(a) of the Food, Agriculture, Conservation and Trade Act of 1990 ( 7 U.S.C. 2279(a) )), or an underserved farmer or rancher shall not exceed 75 percent of the cost of the activity funded by the grant. ; (ii) by redesignating subparagraphs (C) and (D) as subparagraphs (D) and (E), respectively; (iii) by inserting after subparagraph (B) the following: (C) Maximum percentage of loan guarantee The portion of a loan that the Secretary may guarantee under this subsection shall be— (i) in the case of a loan in an amount that is less than $1,000,000, 90 percent of the principal amount of the loan; and (ii) in the case of a loan in an amount that is not less than $1,000,000, 80 percent of the principal amount of the loan. ; and (iv) in subparagraph (E) (as so redesignated), by striking subsection (f) and inserting subsection (g) ; (B) in paragraph (4)— (i) in subparagraph (A), by striking 3-tiered and inserting 2-tiered ; (ii) in subparagraph (B), by striking $80,000 and inserting $150,000 ; (iii) by striking subparagraph (C); (iv) by redesignating subparagraphs (D) and (E) as subparagraphs (C) and (D), respectively; (v) in subparagraph (C) (as so redesignated), in the subparagraph heading, by striking 3 and inserting 2 ; and (vi) in subparagraph (D) (as so redesignated)— (I) by striking The Secretary and inserting the following: (i) In general The Secretary ; (II) in clause (i) (as so designated), by striking tier I projects and more comprehensive for each subsequent tier and inserting tier 1 projects and more comprehensive for tier 2 projects ; and (III) by adding at the end the following: (ii) Scoring The Secretary shall establish a scoring mechanism for tier 1 project applications that is designed to increase program utilization by small- and medium-sized farmers. ; (3) by redesignating subsections (d), (e), and (f) as subsections (e), (f), and (g), respectively; (4) by inserting after subsection (c) the following: (d) Regional demonstration projects (1) In general The Secretary shall carry out regional demonstration projects that incentivize agricultural producers to reduce their carbon footprint or overall carbon equivalent emissions to the maximum extent practicable through the use of energy efficiency improvements and renewable energy systems. (2) Publicization The Secretary shall publicize the results of the regional demonstration projects carried out under paragraph (1). ; (5) in subsection (e) (as so redesignated)— (A) by striking The Secretary shall and inserting Using funds made available under subsection (g)(4), the Secretary shall ; and (B) by inserting or provided, as applicable, after conducted ; (6) in subsection (f) (as so redesignated)— (A) by striking subsection (f) each place it appears and inserting subsection (g) ; and (B) in paragraph (1)— (i) by striking 20 percent and inserting 25 percent ; and (ii) by striking $20,000 and inserting $75,000 ; and (7) in subsection (g) (as so redesignated)— (A) in paragraph (1), by striking subparagraphs (A) through (E) and inserting the following: (A) $50,000,000 for each of fiscal years 2014 through 2023; (B) $100,000,000 for fiscal year 2024; (C) $150,000,000 for fiscal year 2025; (D) $200,000,000 for fiscal year 2026; (E) $250,000,000 for fiscal year 2027; and (F) $300,000,000 for fiscal year 2028 and each fiscal year thereafter. ; (B) by striking paragraph (2) and inserting the following: (2) Project development assistance funding Of the funds made available for each fiscal year under paragraph (1) or any other funds made available to carry out this section, not less than 5 percent shall be made available to carry out subsection (b). ; and (C) by adding at the end the following: (4) Administrative expenses Of the funds made available to carry out this section for a fiscal year, the Secretary shall use not more than 8 percent for administrative expenses. (5) Reservation of funds Of the funds made available to carry out this section for a fiscal year, the Secretary may reserve— (A) not more than 15 percent for awarding grants under subsection (c) that support the adoption of underutilized but proven commercial technologies; and (B) not more that 5 percent to carry out subsection (d). .