II 118th CONGRESS 2d Session S. 5195 IN THE SENATE OF THE UNITED STATES September 25, 2024 Mr. Cardin introduced the following bill; which was read twice and referred to the Committee on Foreign Relations A BILL To establish a verifiable international terrestrial ecosystem services conservation program and provide international technical assistance for the development of markets, and for other purposes.

1. Short title This Act may be cited as the Combatting Global Deforestation Act of 2024 . 2. Findings Congress finds the following: (1) Forests are a vital to the ecological health of the Earth, biodiversity, the protection of water and soil quality, the prevention of erosion and dangerous landslides, the production of oxygen, the regulation of carbon dioxide in the atmosphere, and the regulation of the global system. (2) Forests are a critical natural resource that, when appropriately managed and conserved, provide significant economic, cultural, health, and community benefits to humanity. (3) Since the start of the 20th century, an estimated 3,900,000 square miles of forest have been lost due to human activities, including land conversions for agricultural production, cattle ranching, logging, land development, and extractive industrial activities such as mining and fossil fuel extraction. (4) Since 2000, 23 percent of global tree coverage loss has been the result of deforestation including— (A) 48 percent in Brazil; (B) 50 percent in Argentina; (C) 89 percent in the Philippines; and (D) 96 percent in Indonesia. (5) Deforestation disproportionately affects— (A) critical habitats and ecosystems for critically endangered species such as Sumatran Elephants and Orangutans in Indonesia; (B) the health and quality of water resources through the alteration of critical ecosystem services to hydrological systems, including slowing stormwater runoff into surface waters and providing natural filtration for fallen precipitation that infiltrates groundwater resources; and (C) approximately 370,000,000 people in indigenous communities that rely on naturally forested lands that are historically and culturally significant and provide community and economic opportunities, sustenance, medicinal resources and spiritual connection; 3. Definitions In this Act: (1) Additionality The term additionality means emissions reductions or other terrestrial ecosystem services in developing countries that would not have occurred but for activities to reduce greenhouse gas emissions in partner developing countries funded and made possible by funding provided pursuant to section 5. (2) Appropriate local partner The term appropriate local partner means any relevant subnational government, local authority, indigenous community, non-governmental entity, or private landowner in a partner developing country committed to and capable of achieving the goals described in section 4(b). (3) Country of concern The term country of concern means the government or ruling party of any of the following countries: (A) The Russian Federation. (B) The People’s Republic of China. (C) The Democratic People’s Republic of Korea. (D) The Islamic Republic of Iran. (E) The Bolivarian Republic of Venezuela. (F) The Republic of Cuba. (4) Deforestation The term deforestation means a change in land use, including forest fragmentation and forest degradation, from a forest to any other land use. (5) Eligible project The term eligible project means a verifiable and measurable national or subnational activity developed or executed by the central government, subnational government, local authority, indigenous community, non-governmental entity, private landowner, or any group of such persons in a partner developing country that supports enhancing terrestrial ecosystem services. (6) Emissions reductions The term emissions reductions means greenhouse gas emissions reductions and increased sequestration achieved from— (A) reduced, or avoided deforestation; (B) reforestation; (C) preservation of terrestrial ecosystems; or (D) enhancements to terrestrial ecosystems that will result in the increased sequestration of greenhouse gas emissions. (7) Forest degradation The term forest degradation means any reduction in forest stocks due to the effects of human land-use activities, including land-use changes driven by human activity. (8) Nature-based solution The term nature-based solution means an activity within a partner developing country to conserve, restore, or better manage forests and terrestrial ecosystems to improve terrestrial ecosystem services. (9) Outcome-oriented assistance The term outcome-oriented assistance means a mechanism for the provision of United States assistance in which— (A) a partner developing country, or appropriate local partner in a developing country, assumes responsibility and must demonstrate the achievement of measurable results, or progress towards the achievement of conservation goals, that improve terrestrial ecosystem services associated with activities of an eligible project; (B) such measurable results are defined and agreed upon in a multi-year agreement, and described in section 4(d) of this Act, in advance of the provision of assistance by the United States for the eligible project; and (C) such assistance is expended to such developing country or appropriate local partner only upon independent verification of such pre-defined results. (10) Partner developing country The term partner developing country means— (A) a country eligible to receive official development assistance according to the income guidelines of the Development Assistance Committee of the Organisation for Economic Co-operation and Development; or (B) any other country identified by the Secretary with globally significant forests or terrestrial ecosystems the loss of which is, or has the potential to, significantly contribute to the loss of terrestrial ecosystem services. (11) Program The term Program means the program established pursuant to section 4(a). (12) Terrestrial ecosystems (A) In general The term terrestrial ecosystems means naturally occurring grasslands, forests, tropical rainforests, mangroves, peatlands, or wetlands comprised of native species generated and maintained primarily through natural ecological and evolutionary processes. (B) Exclusion The term terrestrial ecosystems does not include tree plantations, such as crops of trees planted by humans primarily for the purposes of harvesting. (13) Terrestrial ecosystems services The term terrestrial ecosystems services means the direct and indirect benefits that terrestrial ecosystems provide to humans, including— (A) material or energy outputs from an ecosystem, including food, forage, fiber, fresh water, and other resources; (B) benefits obtained through moderation or control of ecosystem processes, including regulation of local climate, air quality, water quality, soil quality, emission reductions, natural carbon sequestration, flood control, erosion control, disease control, and pollination; (C) maintenance of fundamental ecosystem processes, such as habitat for plants and wildlife, or the maintenance of genetic and biological diversity; and (D) non-material benefits provided to human societies and culture, including opportunities for recreation, tourism, aesthetic or artistic appreciation, and spirituality. (14) Secretary The term Secretary means the Secretary of State. 4. Verified International Forest Ecosystem Services Conservation Program (a) In general The Secretary shall establish a program, to be known as the Verified International Forest Ecosystem Services Conservation Program . (b) Purpose The purpose of the Program shall be— (1) to enhance efforts to halt terrestrial ecosystem degradation and loss, and increase terrestrial restoration at scale; (2) to provide contingent outcome-oriented assistance for the achievement of eligible projects in partner developing countries through incentives and assistance to halt terrestrial ecosystem loss; and (3) to enhance restoration of terrestrial ecosystems. (c) Implementation The Secretary shall develop the criteria, guidelines, and processes necessary to implement the Program. (d) Goals In carrying out the program established pursuant to subsection (a), the Secretary shall work with the governments of partner developing countries and appropriate local partners to identify, develop, and implement eligible projects that will or have the potential— (1) to help partner developing countries meet their forest conservation and restoration goals, including efforts to achieve emissions reductions and enhance net natural sequestration capacity associated with deforestation; (2) to enhance terrestrial ecosystem services; (3) to improve natural habitat for species; (4) to preserve culturally and ecologically unique forested lands, including forests containing rare, threatened, or endangered plant species; (5) to contribute to cooperative efforts to conserve and restore natural forests and other terrestrial ecosystems that provide local, regional, and global environmental and health benefits; (6) to provide a counterbalance to investments from any country of concern in activities that utilize destructive industrial practices that degrade or destroy natural forests and other terrestrial ecosystems in partner developing countries; and (7) to reduce illegal deforestation. (e) Outcome-Oriented assistance (1) In general An eligible project shall qualify for outcome-oriented assistance under the Program if— (A) in the determination of the Secretary, the partner developing country or appropriate local partner will be able to fulfill its obligations under a multi-year agreement described in subsection (d) in support of an eligible project through the Program, including (as applicable) with respect to— (i) standards of governance and respect for rule of law in the partner developing country; (ii) environmental and social safeguards; and (iii) safeguarding against the potential for corruption or misuse of assistance provided under this section; (B) the eligible project is appropriately designed to use outcome-oriented assistance; (C) the partner developing country or appropriate local partner, as applicable, agrees— (i) to abide by transparency requirements with respect to the use of funds received under the program established pursuant to subsection (a); (ii) to fulfill measuring, reporting, and verification requirements, including independent third-party verification, necessary to provide outcome-oriented assistance; (iii) to report publicly any data with respect to deforestation associated emissions reductions achieved under such program, in accordance with reporting requirements of or commitments of a partner developing country under relevant international agreements; (iv) to ensure that women, indigenous communities, and other local stakeholders, as applicable, are empowered and enabled to meaningfully participate in the development, implementation, and potential benefits of the eligible project; and (v) to disclose any debt the applicant may owe to any entity known to be owned or controlled by a country of concern, including loan amounts, duration, rates, and contractual provisions; (D) the eligible project enhances terrestrial ecosystems in a manner that can be verified and realizes outcomes that may contribute to meeting the relevant international commitments of the partner developing country; and (E) with respect to subparagraph (C)(v), the partner developing country or appropriate local partner agrees that the assistance provided under this section may not be used to amortize any loan principal owed to any entity known to be owned or controlled by the country of concern. (2) Impact of indigenous communities The presence of indigenous communities subsisting, and engaging in sustainable economic activities, on the lands of an eligible project shall not— (A) be infringed by activities conducted in association with an eligible project; or (B) impact the qualification of an eligible project. (3) Additional economic activity Any additional economic activity pursued on the lands of an eligible project may be permissible if such activities are carried out in accordance with the goals described in subsection (d). (4) Additional forms of qualification for outcome-oriented assistance Notwithstanding paragraph (1), an eligible project may qualify for outcome-oriented assistance under this subsection if— (A) the eligible project includes a combination or aggregation of existing activities that align with the goals described in subsection (d) such that the total of such projects contributes to the full national or, on an interim basis, subnational territory in the partner developing country; or (B) the eligible project is nested into the accounting and reporting of an existing national or sub-national program or activity in the partner developing country, including with regard to safeguard requirements and any transfer of verifiable environmental credits that qualify for use or transfer under internationally recognized systems that may meet the international environmental commitments of the partner developing country, without regard to whether the eligible project is below the subnational level or scale. (5) Private or partner country contribution support requirement (A) In general Outcome-oriented assistance shall only be granted to eligible projects that secure additional funding from sources other than the United States Government in an amount that is not less than the 10 percent of the amount determined to be provided out of the fund established under subsection (h) for the eligible project based on the terms of the multi-year agreement of such eligible project (B) Private partners The Secretary is encouraged— (i) to include private sector partners as supporters of eligible projects; and (ii) to facilitate the security of financial commitments from private contributions, which shall be counted toward the requirement under subparagraph (A) for an eligible project. (6) Partnerships with multilateral programs The Secretary may partner with multilateral or multi-donor programs to jointly support an eligible project under this subsection. (7) Double counting of assistance The Secretary shall take such steps as may be necessary— (A) to prevent the double counting of, or double payment for, results from eligible projects that also may receive funds from other sources, including in accordance with relevant international guidelines and rules; and (B) to ensure that the assistance provided under this section and eligible projects are interoperable and do not supplant or compete with the achievement of country-level commitments under international agreements. (f) Multi-Year agreements governing the provision of outcome-Oriented assistance (1) In general Upon determining that an eligible project qualifies for outcome-oriented assistance, the Secretary is authorized to enter into a multi-year agreement with a partner developing country, or appropriate local partners in the partner developing country, to determine the terms and conditions for which the provision of outcome-oriented assistance, in the form of grants from the fund established in subsection (h), may be administered to support an eligible project. (2) Prioritization The Secretary is encouraged to prioritize consideration of entering multi-year agreements for eligible projects that would directly or indirectly combat illegal deforestation or counter malicious influence from a country of concern in a partner developing country. (3) Third-party leverage of funds The Secretary is encouraged to prioritize entering multi-year agreements for eligible projects that include terms that leverage funding from non-profits, businesses, other developed countries, and multilateral financing and development agencies. (4) Additional economic activities within an eligible project Multi-year agreements shall— (A) permit economic activities within the area of an eligible project; and (B) seek assurances that the conduct of such economic activities does not degrade the effectiveness of an eligible project in accordance with the goals described in subsection (d). (5) Terms In negotiating multi-year agreements under this subsection, the Secretary shall do the following: (A) Reciprocal commitment The Secretary shall take steps to ensure that the partner developing country or appropriate local partners in the partner developing country, as applicable, reciprocate the commitments to achieving the goals described in subsection (d). (B) Duration of agreement The Secretary— (i) shall negotiate and reach a mutually agreed upon term-length for each multi-year agreement; (ii) may renegotiate and re-enter a multi-year agreement prior to or after the terms and dates of the multi-year agreement expire; and (iii) shall seek assurances that the agreed upon goals and objectives for enhancing terrestrial ecosystem services achieved through the relevant eligible project will last in perpetuity. (C) Right to title The Secretary may negotiate for the United States to own and control title to the greenhouse gas emission reductions associated with the activities of an eligible project for the purposes of counting such reductions toward the international emission reduction commitments of the United States. (6) Termination An agreement under this subsection may be unilaterally terminated by the Secretary if— (A) the Secretary determines that the partner developing country or a appropriate local partner is failing or has failed to uphold the terms and conditions established for the eligible project; or (B) the Secretary— (i) determines that the eligible project is not in the national interest of the United States; and (ii) submits to Congress a notification of such determination. (g) Reviews and reports (1) Periodic reviews The Secretary shall periodically review and evaluate the progress of eligible projects— (A) to ensure that eligible projects are proceeding successfully and appropriately maintained; (B) to account for and adapt to externalities that could prevent an eligible project from meeting its objectives; and (C) to advise proponents of an eligible projects in planning and executing the eligible project in accordance with this Act. (2) Transparency The Secretary shall— (A) make publicly available a list of funds made available under the Program; and (B) update on an annual basis the progress or any lack of progress in the implementation of the eligible projects corresponding to such funds and the achievement of the goals described in subsection (d). (3) Published certification of partnership The Secretary shall annually publish and provide certificates of contribution to private donors that contribute funds that support eligible projects detailed in multi-year agreements that include— (A) the amount of funds the private donor contributed to the eligible project for each calendar year that funds were provided; (B) the location of the eligible project including country and region; (C) the partner developing country or appropriate local partner that is signatory to the multi-year agreement for which the private donor is contributing funds for work on an eligible project; and (D) a summary of the environmental impact of the eligible project including— (i) the size in acres of terrestrial ecosystems that are being protected or restored; (ii) the significance of such protected or restored terrestrial ecosystems; and (iii) the verified amount of carbon sequestered by the supported project. (h) Duplication of efforts In carrying out the program under this section, the Secretary shall consult as appropriate with the Administrator of the United States Agency for International Development to avoid duplicative foreign aid efforts, particularly for conservation funds. (i) Trust fund There is established in the Treasury of the United States a fund to be known as the Verified International Terrestrial Ecosystem Services Conservation Fund , which shall consist of— (1) amounts appropriated pursuant to the authorization in subsection (j)(1) to carry out this section; and (2) such gifts, bequests, or devises of property for the benefit of, or in connection with carrying out this section as the Secretary may accept in the form of donations by individuals or entities, including private entities, non-profit entities, other developed countries, and multinational entities. (j) Authorization of appropriations (1) Authorization There is authorized to be appropriated to carry out this section— (A) $875,000,000 for fiscal year 2024; (B) $875,000,000 for fiscal year 2025; (C) $875,000,000 for fiscal year 2026; and (D) $875,000,000 for fiscal year 2027. (2) Availability Amounts appropriated to carry out this section are authorized to remain available until expended and shall be used solely for the purposes of this section. (3) Salaries and expenses Of the amounts made available for any fiscal year pursuant to the authorization under paragraph (1), not more than $4,000,000 is authorized to be made available for the salaries and expenses to carry out this section. (k) Natural forest reference baseline for eligible projects (1) Proposals for natural forest reference baseline (A) In general To receive outcome-oriented assistance under this section for an eligible project qualified to receive outcome-oriented assistance pursuant to subsection (e), a partner developing country or appropriate local partner shall submit to the Secretary a proposal for a forest reference level baseline that is credible, transparent, accurate, and conservatively evaluates and establishes a forest reference level baseline of an eligible project in accordance with the criteria established by the Secretary under paragraph (2). (B) Determination by Secretary (i) In general After receipt of a proposal under subparagraph (A), the Secretary shall determine whether the forest reference level baseline meets the criteria under paragraph (2). (ii) Provision of outcome-oriented assistance approved forest reference level baseline If the Secretary determines under clause (i) that the proposed forest reference level baseline meets the criteria under paragraph (2), the Secretary may provide outcome-oriented assistance for such eligible project to the developing country or appropriate local partner in accordance with this section. (iii) Failure to meet criteria (I) In general If the Secretary determines under clause (i) that the proposed forest reference level baseline does not meet the criteria under paragraph (2), the Secretary may negotiate with the partner developing country or appropriate local partner to reach an agreement on a forest reference level baseline for the eligible project in accordance with paragraph (2). (II) Provision of outcome-oriented assistance for agreed forest reference level baseline Once an agreement has been reached under subclause (I), the Secretary may provide outcome-oriented assistance for the eligible project to the developing country or appropriate local partner in accordance with this section. (2) Baseline criteria The Secretary shall establish criteria for each forest reference level baseline proposed, which shall include requirements that the forest reference level baseline— (A) is used to account for the net size of forested lands or significant naturally vegetated lands achieved from the eligible project; (B) is national, or subnational on an interim basis, in scope; (C) is consistent with the environmental stewardship commitments, targets, or actions that are appropriate for the partner developing country with respect to combatting deforestation or loss of terrestrial ecosystem services— (i) taking into consideration the average annual historical emissions and removals associated with the forests, and other terrestrial ecosystems, as applicable, of the partner developing country during a period of at least 5 years; and (ii) if appropriate, using the relevant 2006 IPCC Guidelines for National Greenhouse Gas Inventories published by the Intergovernmental Panel on Climate Change to determine applicable drivers of deforestation and land use conversion; (D) establishes a trajectory that would result in zero net deforestation by not later than 10 years after the date on which the baseline is established; (E) is updated not less frequently than once every 5 years to account for changing circumstances in the developing country; (F) accounts for the size of forested areas based on— (i) remaining natural forest land; (ii) conversions of other lands to or from natural forest land; and (iii) any other land-use category estimated to contribute at least 10 percent of agriculture, forestry, and other land use emissions in the project area; and (G) takes into consideration existing or planned terrestrial ecosystem services or forest conservation or restoration projects as described in subsection (e) in a partner developing country and the effect those projects might have in determining protection or restoration activities with respect to terrestrial ecosystem services and establishing a forest reference level baseline for eligible projects funded under this Act. 5. Nature-based solutions (a) In general The Administrator of the United States Agency for International Development, in consultation with the Secretary, shall conduct a program to provide technical assistance to build the capacities of partner developing countries and appropriate local partners to improve conservation, natural forest management, and restoration of natural forests and other terrestrial ecosystems for the purposes of— (1) enhancing the terrestrial ecosystem services and sustainable economic value of such natural resources; and (2) facilitating the preparation of eligible projects in accordance with section 4. (b) Eligible activities In conducting the program described in subsection (a), the Administrator of the United States Agency for International Development may provide technical support to partner developing countries and appropriate local partners for the following activities: (1) Reducing deforestation related emissions, forest fragmentation, and forest degradation of significant forests within a partner developing country. (2) Enhancing the natural carbon sequestration ability of the natural forests and the terrestrial ecosystem services of a potential eligible project within a partner developing country, and building resilience. (3) Monitoring, reporting, and verification of the environmental, social, and financial quality and integrity of the project as an important component of the work. (4) Assisting governments, willing, legitimate landowners, or willing customary use rights holders in developing projects to engage in conservation credit markets through— (A) the implementation of science-based metrics for determining that conservation activities have generated verifiable environmental credits that may be sold to buyers on existing conservation compliance markets; or (B) projects providing outcome-oriented assistance. (5) Developing domestic infrastructure and capacity building for creating and tracking conservation credits, such as registries or projects eligible for outcome-oriented assistance, and preparing countries to implement nature-based solution initiatives. (6) Ensuring that women, Indigenous Communities, and other local stakeholders are empowered and enabled to meaningfully participate and share in the potential benefits of activities funded under this section. (7) Ensuring the additionality of projects, programs, and other activities made possible by funding provided pursuant to this section. (c) Authorization There is authorized to be appropriated $10,000,000 to carry out this section.