II 118th CONGRESS 1st Session S. 3399 IN THE SENATE OF THE UNITED STATES December 5, 2023 Mr. Casey (for himself, Mr. Braun , and Ms. Stabenow ) introduced the following bill; which was read twice and referred to the Committee on Agriculture, Nutrition, and Forestry A BILL To authorize the Secretary of Agriculture to guarantee investments that will open new markets for forest owners in rural areas of the United States, and for other purposes.

1. Short title This Act may be cited as the Rural Forest Markets Act of 2023 . 2. Rural Forest Market Investment Program (a) Definitions In this section: (1) Covered entity The term covered entity means an eligible entity for which a bond, loan, or other investment vehicle is guaranteed under the program. (2) Eligible entity The term eligible entity means a private entity, State forestry agency, or publicly supported, charitable nonprofit organization described in section 501(c)(3) of the Internal Revenue Code of 1986 and exempt from taxation under section 501(a) of that Code engaged in or seeking to engage in the aggregation of sustainable forestry practices implemented by rural private forest landowners to facilitate the sale of environmental credits in voluntary environmental credit markets. (3) Program The term program means the Rural Forest Market Investment Program established under subsection (b)(1). (4) Rural The term rural has the meaning given the term in section 343(a) of the Consolidated Farm and Rural Development Act ( 7 U.S.C. 1991(a) ). (5) Secretary The term Secretary means the Secretary of Agriculture. (6) Voluntary environmental credit market The term voluntary environmental credit market means a voluntary market through which environmental credits may be bought or sold. (b) Establishment of program (1) In general The Secretary shall establish a program, to be known as the Rural Forest Market Investment Program , to guarantee environmental impact bonds, loans, or other investment vehicles, as determined by the Secretary, issued for the sole purpose of financing eligible projects described in subsection (c), to enable rural private forest landowners and covered entities to participate in voluntary environmental credit markets. (2) Administration (A) Loan guarantees The Secretary shall make available and administer guarantees on environmental impact bonds, loans, or other investment vehicles, as determined by the Secretary, through the facilities and authorities of the Under Secretary for Rural Development. (B) Forestry related matters (i) In general The Secretary shall carry out through the facilities and authorities of the Under Secretary for Natural Resources and Environment the requirements and administration under this section of matters relating to forests, forestry, tree planting activities, forest product markets, the timber supply, appropriate activities to develop and carry out an eligible project, and activities to facilitate the participation of a rural private forest landowner or a covered entity in voluntary environmental credit markets, and as otherwise provided in this section, as determined appropriate by the Secretary. (ii) Collaboration The Under Secretary for Natural Resources and Environment shall collaborate with the Under Secretary for Rural Development, including by providing information and technical assistance, to ensure that the making and administration of guarantees under this section is fully informed by the matters described in clause (i) and as otherwise provided in this section, as determined appropriate by the Secretary. (3) Consideration In establishing the program, the Secretary shall consider ways to ensure that the program— (A) minimizes disruptions to traditional forest products markets, including by— (i) collecting data on commercially available timber that serves wood processing facilities, including— (I) the quantity and species of timber supply available to wood products facilities in each of the 4 regions described in the most recent Renewable Resource Assessment prepared under section 3 of the Forest and Rangeland Renewable Resources Planning Act of 1974 ( 16 U.S.C. 1601 ); and (II) any additional information, as identified by the Secretary; and (ii) using data collected under clause (i) to make a determination on whether financing each eligible project described in subsection (c) may impact commercially available timber supply; (B) allows for the continued production of sustainable timber supplies by utilizing methodologies that consider the carbon storage benefits of wood products; (C) allows for landowners who are not currently involved in traditional forest products markets, including those who have not historically accessed Department of Agriculture assistance programs, to participate in the program through activities such as conservation easements, reforestation, and other appropriate activities, as determined by the Secretary; (D) facilitates participation opportunities for forest landowners, and ensures program access for those who have not historically accessed Department of Agriculture assistance programs; and (E) is carried out in a manner that increases forestland values for participating landowners in ways that enable landowners of small-acreage forests to maintain— (i) ownership of the land in the family of the landowner; and (ii) forest use of the land. (c) Eligible projects (1) In general Subject to paragraph (2), an eligible project referred to in subsection (b)(1) is a project developed by an eligible entity using methodologies that, as determined by the Secretary— (A) are approved by a credible, third-party entity; and (B) meet global benchmarks for high-integrity. (2) Uses of financing (A) In general A covered entity shall use the bond, loan, or other investment vehicle guaranteed for the covered entity under the program for appropriate activities to develop and carry out an eligible project described in paragraph (1), as determined by the Secretary. (B) Additional activities for certain organizations In the case of a bond, loan, or other investment vehicle guaranteed under the program that supports an eligible project described in paragraph (1), the Secretary may allow a portion of the amount of the bond, loan, or other investment vehicle to cover additional activities to facilitate the participation of the covered entity or a rural private forest landowner in voluntary environmental credit markets. (C) Prohibition A bond, loan, or other investment vehicle guaranteed under the program shall not be used to create a floor price or artificial demand for the environmental credits generated under eligible projects described in paragraph (1). (d) Requirements A project described in subsection (c) that includes the practice of tree planting may only be carried out, as determined by the Secretary— (1) on land that was historically forested, as determined based on— (A) data collected through the Forest Inventory and Analysis Program of the Forest Service; and (B) other appropriate scientific resources, as determined by the Secretary; (2) using tree species that are native to the region and at ecologically appropriate densities; and (3) in a manner that does not create other negative impacts to biodiversity or the environment. (e) Guarantee amount With respect to bonds, loans, and other investment vehicles guaranteed under the program, the Secretary shall guarantee not more than $150,000,000 in the aggregate. (f) Implementation (1) Appraisals The Secretary may require an appraisal of an eligible entity requesting a guarantee under the program, including to assess the creditworthiness of the eligible entity, by a specialized appraiser that uses standards that are similar to standards used for similar purposes in the private sector, as determined by the Secretary. (2) Financial information The Secretary may require financial information from an eligible entity requesting a guarantee under the program in the same manner as is generally required by commercial lenders. (g) Auditing Not less frequently than annually, the Secretary shall conduct audits of each eligible project financed under the program to ensure that the methodology used with respect to the project continues to comply with the standards determined by the Secretary under subparagraphs (A) and (B) of subsection (c)(1). (h) Regulations Not later than 180 days after the date of enactment of this Act, the Secretary shall issue regulations to implement the program. (i) Termination of authority The authority to guarantee a new bond, loan, or other investment vehicle under this section terminates on September 30, 2028.