I 118th CONGRESS 1st Session H. R. 5359 IN THE HOUSE OF REPRESENTATIVES September 8, 2023 Mr. Costa (for himself, Mr. Garamendi , Mr. LaMalfa , Ms. Lofgren , and Mr. Valadao ) introduced the following bill; which was referred to the Committee on Agriculture , and in addition to the Committees on Energy and Commerce , Natural Resources , and Financial Services , for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned A BILL To harmonize the population threshold for rural communities under programs carried out by the Department of Agriculture, and for other purposes.

1. Short title This Act may be cited as the Rural Development Modernization Act . 2. Harmonization of the population threshold for rural communities under Department of Agriculture programs (a) Increase in population thresholds under certain programs (1) Broadband, telemedicine, and distance learning (A) In general Section 601(b)(3)(A)(ii) of the Rural Electrification Act of 1936 ( 7 U.S.C. 950bb(b)(3)(A)(ii) ) is amended by striking 20,000 inhabitants and inserting 50,000 inhabitants (excluding populations described in subparagraphs (F) and (G) of such section) . (B) Ratio for allocation Section 601(j)(2)(B) of such Act ( 7 U.S.C. 950bb(j)(2)(B) ) is amended by striking 2,500 each place it appears and inserting 10,000 . (2) Telephone service loans Section 203(b) of the Rural Electrification Act of 1936 ( 7 U.S.C. 924(b) ) is amended by striking 5,000 inhabitants and inserting 50,000 inhabitants (excluding populations described in subparagraphs (F) and (G) of section 343(a)(13) of the Consolidated Farm and Rural Development Act) . (3) Reservation applicable to loan guarantees for water, wastewater, and essential community facilities loans Section 306(a)(24)(D)(ii) of the Consolidated Farm and Rural Development Act ( 7 U.S.C. 1926(a)(24)(D)(ii) ) is amended by striking 20,000 and inserting 30,000 . (4) Emergency and imminent community water assistance grants Section 306A(e) of the Consolidated Farm and Rural Development Act ( 7 U.S.C. 1926A(e) ) is amended— (A) in paragraph (1)(A), by striking 10,000 and inserting 50,000 ; and (B) in paragraph (2), by striking 3,000 and inserting 10,000 . (5) Rural housing Title V of the Housing Act of 1949 is amended— (A) in section 520 ( 42 U.S.C. 1490 )— (i) in the first sentence— (I) in clause (1), by striking 2,500 and inserting 10,000 ; (II) in clause (2)— (aa) by striking 2,500 and inserting 10,000 ; and (bb) by striking 10,000 and inserting 30,000 ; and (III) in clause (iii)— (aa) by striking 10,000 and inserting 30,000 ; and (bb) by striking 20,000 and inserting 50,000 ; (ii) in the second sentence, by striking 35,000 and inserting 50,000 ; and (iii) by striking the last sentence and inserting the following: In determining whether an area is rural or a rural area , the Secretary shall disregard the populations described in subparagraphs (F) and (G) of section 343(a)(13) of the Consolidated Farm and Rural Development Act ( 7 U.S.C. 1991(a)(13) ). ; and (B) in section 533(d)(3)(C) ( 42 U.S.C. 1490m(d)(3)(C) ), by striking 10,000 and inserting 30,000 . (b) Elimination of cap on military base population exclusion Section 343(a)(13)(I) of the Consolidated Farm and Rural Development Act ( 7 U.S.C. 1991(a)(13)(I) ) is amended— (1) in the subparagraph heading, by striking Limited exclusion and inserting Exclusion ; and (2) by striking The first 1,500 and inserting Populations of . (c) Elimination of lower population thresholds under water and waste, and community facilities programs (1) In general Section 343(a)(13) of the Consolidated Farm and Rural Development Act ( 7 U.S.C. 1991(a)(13) ) is amended by striking subparagraphs (B) and (C) and redesignating subparagraphs (D) through (I) as subparagraphs (B) through (G), respectively. (2) Conforming amendments Section 343(a)(13) of such Act ( 7 U.S.C. 1991(a)(13) ) is amended— (A) in subparagraph (A), by striking (I) and inserting (G) ; (B) in subparagraph (D)(i), by striking (F) each place it appears and inserting (D) ; and (C) in subparagraph (F), by striking clause (ii) and inserting the following: (ii) Adjustments The Secretary may, by regulation only, consider an area described in clause (i)(I) of this subparagraph not to be a rural area for purposes of subparagraph (A). . (d) Exclusion of incarcerated and military base populations in determining whether part of an area is rural in character (1) In general Section 343(a)(13)(D)(iii) of the Consolidated Farm and Rural Development Act ( 7 U.S.C. 1991(a)(13)(D)(iii) ) is amended by redesignating subclauses (III) through (VII) as subclauses (IV) through (VIII), respectively, and inserting after subclause (II) the following: (III) disregard the populations described in subparagraphs (F) and (G) in determining whether part of an area is rural in character; . (2) Conforming amendment Section 343(a)(13)(D)(iii)(V) of such Act ( 7 U.S.C. 1991(a)(13)(D)(iii)(V) ) is amended by striking (IV) and inserting (V) . 3. Harmonization of the population threshold for rural communities under Department of Energy program Section 609(a)(5) of the Public Utility Regulatory Policies Act of 1978 ( 7 U.S.C. 918c(a)(5) ) is amended by striking 10,000 inhabitants and inserting 50,000 inhabitants (excluding populations described in subparagraphs (F) and (G) of section 343(a)(13) of the Consolidated Farm and Rural Development Act ( 7 U.S.C. 1991(a)(13) ) . 4. Harmonization of the population threshold for rural water supply projects The Reclamation Rural Water Supply Act of 2006 ( 43 U.S.C. 2401 et seq. ) is amended— (1) by amending section 102(9)(A) to read as follows: (A) In general The term “rural water supply project” means a project that is designed to serve a community or group of communities— (i) each of which has a population of not more than 50,000 inhabitants (excluding populations described in subparagraphs (F) and (G) of section 343(a)(13) of the Consolidated Farm and Rural Development Act ( 7 U.S.C. 1991(a)(13) ); and (ii) which may include Indian Tribes and Tribal organizations, dispersed homesites, or rural areas with domestic, industrial, municipal, and residential water. ; and (2) in section 202(6)— (A) by redesignating subparagraphs (B) and (C) as subparagraphs (D) and (E) respectively; and (B) by inserting after subparagraph (A) the following: (B) a rural water project or rural water supply project authorized under— (i) section 1110 of division FF of the Consolidated Appropriations Act, 2021 ( Public Law 116–260 ); or (ii) any other Federal statute; (C) any project authorized for an Indian Tribe under part III of subtitle A of title X of the Omnibus Public Land Management Act of 2009 ( Public Law 111–11 ); . 5. Clarifications regarding United States territories and freely associated states (a) Broadband, telemedicine, and distance learning (1) Section 601(c)(3)(D)(ii) of the Rural Electrification Act of 1936 ( 7 U.S.C. 950bb(c)(3)(D)(ii) ) is amended by inserting , including any such communities in a territory or possession of the United States before the period. (2) Section 601(d)(4) of such Act ( 7 U.S.C. 950bb(d)(4) ) is amended— (A) in the subsection heading, by inserting , territorial, before and local ; and (B) in the text, by inserting , territorial, before or local . (b) Community connect grants Section 604(a)(3)(A)(i)(III) of the Rural Electrification Act of 1936 ( 7 U.S.C. 950bb–3(a)(3)(A)(i)(III) ) is amended by inserting or territory of the United States before the semicolon. (c) Rural cooperative development grants Section 310B(e)(1)(B) of the Consolidated Farm and Rural Development Act ( 7 U.S.C. 1932(e)(1)(B) ) is amended by inserting the Commonwealth of the Northern Mariana Islands, before and the . (d) Consolidated Farm and Rural Development Act Each of sections 343(a)(6) and 381A(1) of the Consolidated Farm and Rural Development Act ( 7 U.S.C. 1991(a)(6) and 2009(1)) is amended by striking Trust Territory of the Pacific Islands and inserting the Republic of the Marshall Islands, the Federated States of Micronesia, or the Republic of Palau, pursuant to the terms of the applicable Compact of Free Association with the United States . (e) Housing Act of 1949 Title V of the Housing Act of 1949 ( 42 U.S.C. 1471 et seq. ) is amended— (1) in section 501 ( 42 U.S.C. 1471 )— (A) in subsection (a), by striking and in the Territories of Alaska and Hawaii and in the Commonwealth of Puerto Rico, the Virgin Islands, the territories and possessions of the United States, and the Trust Territory of the Pacific Islands and inserting , including any territory or other possession of the United States ; and (B) in subsection (b)(4), by striking the Northern Mariana Islands, and the Trust Territory of the Pacific Islands and inserting and the Northern Mariana Islands ; and (2) in section 502(h)(16)(D) ( 42 U.S.C. 1472(h)(16)(D) ), by striking the Trust Territories of the Pacific, . 6. Technical and conforming amendments (a) Section 748 of the Agriculture, Rural Development, Food and Drug Administration, and Related Agencies Appropriations Act, 2002 ( 7 U.S.C. 918b ) is amended by inserting a comma after Service . (b) The Rural Electrification Act of 1936 is amended— (1) in section 305(d)(3)(C) ( 7 U.S.C. 935(d)(3)(C) ), by striking (2)(A)(iii) and inserting (2)(A)(ii) ; (2) in section 306A(e) ( 7 U.S.C. 936a(e) ), by striking transfered and inserting transferred ; (3) in section 601(e)(4)(C)(i) ( 7 U.S.C. 950bb(e)(4)(C)(i) ), by adding and at the end; (4) in section 603(c)(1)(A) ( 7 U.S.C. 950bb-2(c)(1)(A) ), by striking maximum and inserting minimum ; and (5) in section 701(a) ( 7 U.S.C. 950cc(a) ), by striking the first comma. (c) The Consolidated Farm and Rural Development Act is amended— (1) in section 306(a)(20)(E) ( 7 U.S.C. 1926(a)(20)(E) ), by striking states and inserting States ; (2) in section 307(a)(6)(B)(i) ( 7 U.S.C. 1927(a)(6)(B)(i) ), by striking the comma and inserting a semicolon; (3) in section 310B(e)(4)(C)(vi) ( 7 U.S.C. 1932(e)(4)(C)(vi) ), by striking center and inserting centers ; (4) in section 310B(i)(1)(A) ( 7 U.S.C. 1932(i)(1)(A) ), by inserting section before 501(a) ; (5) in section 310E(d)(4)(C) ( 7 U.S.C. 1935(d)(4)(C) ), by striking ; and the second place it appears; (6) in section 310F ( 7 U.S.C. 1936(e)(2) ), in the paragraph heading, by striking Eligiblity and inserting Eligibility ; (7) in section 343(a)(11)(C) ( 7 U.S.C. 1991(a)(11)(C) ), by striking operator and inserting operators ; (8) in section 373(b)(2)(A)(ii) ( 7 U.S.C. 2008h(b)(2)(A)(ii) ), by striking chapters 11, 12, or 13, of Title and inserting chapter 11, 12, or 13 of title ; and (9) in section 381F ( 7 U.S.C. 2009e(a) ), by striking Director and inserting director . (d) The Housing Act of 1949 ( 42 U.S.C. 1471 et seq. ) is amended— (1) in section 501 ( 42 U.S.C. 1471 ), by transferring paragraph (5) of subsection (a) to subsection (b), adding such paragraph at the end of subsection (b), and redesignating such paragraph as paragraph (9); (2) in section 515 ( 42 U.S.C. 1485 )— (A) in subsection (h)(2)(B), by inserting for after approval requirements ; and (B) in subsection (r)(1), by striking the Secretary— and inserting The Secretary— ; (3) in section 520 ( 42 U.S.C. 1490 ), in the first sentence, by striking (except in the cases of Pajaro, in the State of California, and Guadalupe, in the State of Arizona) ; (4) in section 536(e) ( 42 U.S.C. 1490p )— (A) in paragraph (1), in the matter preceding subparagraph (A), by inserting of after or (d) ; and (B) in paragraph (2), by striking any section and inserting any subsection ; and (5) in section 538 ( 42 U.S.C. 1490r )— (A) in subsection (d)(2), by striking low or moderate income and inserting low- or moderate-income ; and (B) in subsection (t), by striking chapter I and inserting chapter 1 . (e) The Reclamation Rural Water Supply Act of 2006 ( 43 U.S.C. 2401 et seq. ) is amended— (1) in section 106(e), by striking (1) In general and all that follows through After completion and insert After completion ; (2) in section 107(e), by striking or a grant is made, to an organization and inserting or a grant is made to, an organization ; and (3) in section 202(2)(A), by striking of title 17, Code of Federal Regulation and inserting of title 17, Code of Federal Regulations .