S895NOV18

TheWeekInCongress.com

Week Ending November 18, 2005

S.895 A bill to direct the Secretary of the Interior to establish a rural water supply program in the Reclamation States to provide a clean, safe affordable, and reliable water supply to rural residents.

BRIEF

The report accompanying the bill explained the need as such: “Millions of Americans live without safe and reliable drinking water supplies. Lack of adequate drinking water is especially prevalent in rural America which, in many cases, is unable to afford the capital outlays for new water infrastructure or to upgrade deteriorating infrastructure. A 1995 needs assessment conducted by the United States Department of Agriculture's Rural Development State Offices found over one million people in the United States had no water piped into their homes, and more than 2.4 million had critical drinking water needs. According to a 2001 Environmental Protection Agency (EPA) survey of capital improvement needs for public water systems, total funding needs for small systems serving populations of 3,300 or less will be $31.2 billion over 20 years (1999-2018). The EPA determined that, on average, over 10 percent of rural communities in the 17 Reclamation States have contaminated water supplies. The Indian Health Service estimates that approximately 20,000 households in American Indian Communities and Alaska Native Villages lack potable water supplies. Additionally, compliance with water quality requirements derived from the Federal Clean Water and Safe Drinking Water Acts has proven especially onerous and expensive for rural communities required to invest in water supply and wastewater infrastructure.

“Over the past 30 years, Congress has authorized and amended various programs to assist communities in addressing their water and wastewater problems. In 1995, the General Accounting Office reported that eight Federal agencies had 17 programs designed specifically for rural areas to construct or improve water and wastewater facilities. Water and wastewater programs are primarily found within the Bureau of Reclamation (hereinafter `Bureau'), Department of Agriculture, Department of Commerce, Department of Housing and Urban Development, the Army Corps of Engineers and the Environmental Protection Agency. These programs differ in purpose, scope, eligibility criteria, and assistance provided.

“Unlike rural water supply programs within other agencies that have standing program authorization, the Bureau undertakes individual rural water supply projects at the express direction of Congress. Because rural water projects undertaken by the Bureau do not have clear eligibility and lack programmatic criteria, communities that do not meet criteria for other, authorized programs often approach Congress with proposals for water supply projects. Since the early 1980's, Congress has directed the Bureau to develop ten independently authorized single-purpose municipal and industrial water supply projects for rural communities throughout the Western United States. The Federal cost share, typically between 75 percent and 85 percent, of these projects tends to be much larger than programs administered by other agencies. Some have raised concerns that these projects could overwhelm the Bureau's resources particularly when the Bureau's budget is limited to approximately $800 million annually. For example, the Lewis and Clark project has an estimated Federal cost of $214 million and the Mni Wiconi Project has an estimated cost of $417 million.

“During the 108th Congress, Commissioner Keys testified that the Bureau has no general authority to plan, design, and construct rural water projects, and therefore has a limited ability to set priorities or promulgate criteria for project development and, as a result, to budget accordingly for these projects. For this reason, there is no predictable funding as it must be secured annually through the appropriations process. As a result, a backlog of authorized but uncompleted rural water supply projects remains. Outstanding construction authorization totals approximately $2.3 billion.

“Because the Bureau does not have an authorized rural water program, small communities seeking to address long-term water needs are unable to seek assistance from the Bureau. Rural communities must wait for Congress to direct the Bureau to proceed with appraisal and feasibility studies for a water supply project. To expedite the process, rural communities frequently undertake project studies independently which later become the basis for Bureau project authorizations. Because the Bureau was uninvolved in this process, some of these projects are not prepared according to Federal engineering and planning standards and do not provide the best alternative for a water supply project. The Bureau has expressed interest in becoming involved during the planning stages for rural water supply projects and establishing a Bureau `rural water program with adequate controls and guidelines.'”

Sponsor: Senator Pete V Domenici (R-AZ)

Vote: Passed Senate by Unanimous Consent November 16, 2005

Cost to the taxpayers: The CBO report was not yet available when the bill came to the floor. Cost data is forthcoming

MORE INFORMATION

SECTION-BY-SECTION ANALYSIS

Section 101 provides the short title, the `Rural Water Supply Act of 2005.'

Section 102 defines the terms used in title I of this Act.

Section 103 subsection (a) directs the Secretary to carry out a rural water supply program in the Reclamation States to provide water to small communities for domestic, municipal and industrial use.

Subsection (b) provides that any activity carried out under this title shall be in cooperation with a qualifying non-Federal entity.

Subsection (c) directs the Secretary, not later than 1 year after the date of enactment of this Act, to promulgate criteria for eligibility under the program.

Subsection (d) provides factors that the Secretary shall consider when promulgating criteria under subsection (c).

Subsection (e) provides that the Secretary may include a connection to preexisting infrastructure if it provides a reliable water supply and may consider a community in excess of 50,000 inhabitants as part of a project if the Secretary determines the community is a critical partner.

Section 104 subsection (a) directs the Secretary, in collaboration with the heads of agencies that administer rural water supply programs, to assess the status of all authorized but uncompleted rural water supply projects under the jurisdiction of the Secretary, the demand for rural water supply projects, the demand for rural water projects that the Secretary can meet with the authority provided under this title, how the authority provided under this Act will compliment existing rural water supply programs and improvements that can be made to coordinate rural water supply programs within the federal government.

Subsection (b) directs the Secretary to consult with States with identified rural water needs before finalizing the assessment under subsection (a).

Subsection (c) directs the Secretary to report on the assessment conducted under subsection (a).

Section 105 subsection (a) directs the Secretary, upon request of a non-Federal project entity to either: accept an appraisal investigation developed and submitted by a non-Federal project entity; conduct an appraisal investigation; or provide a grant or enter into a cooperative agreement with a non-Federal project entity to conduct an appraisal investigation. It is the intent of the Committee that when the Secretary undertakes an appraisal study pursuant to section 105 subsection (a), the Secretary shall comply with section 208 of the Energy and Water Development Appropriations Act, 2003 Act (Public Law 108-7; 117 Stat. 11) and that the Secretary will also ensure that appraisal level work is performed by qualified entities with demonstrated competence and qualifications.

Subsection (b) requires an appraisal investigation be completed not later than 2 years after it is initiated.

Subsection (c) directs the Secretary to prepare an appraisal report based on the investigation.

Subsection (d) directs the Secretary to promulgate appraisal criteria for appraisal investigations.

Subsection (e) directs the Secretary to assess for completeness any appraisal investigation that not performed by the Secretary.

Subsection (f) directs the Secretary to develop an appraisal report if all necessary information is provided under subsection (e)

Subsection (g) sets forth the Federal cost share of appraisal investigations.

Subsection (h) directs the Secretary to consult with appropriate entities in conducting appraisal investigations.

Section 106 subsection (a) provides that, if the appraisal report completed under section 105(a) recommends undertaking a feasibility study, the Secretary shall: conduct a feasibility study, accept a feasibility study developed and submitted by a non-Federal project entity, or provide a grant or enter into a cooperative agreement with a non-Federal project entity to conduct a feasibility study. It is the intent of the Committee that when the Secretary undertakes a feasibility study pursuant to section 106 subsection (a), the Secretary shall comply with section 208 of the Energy and Water Development Appropriations Act, 2003 Act (Public Law 108-7; 117 Stat. 11) and that the Secretary will also ensure that feasibility level work is performed by qualified entities with demonstrated competence and qualifications.

Subsection (b) directs the Secretary to assess for completeness any feasibility study not performed by the Secretary.

Subsection (c) sets forth criteria to be considered by the Secretary.

Subsection (d) directs the Secretary to promulgate feasibility criteria to be used for assessing feasibility studies.

Subsection (e) directs the Secretary to prepare a feasibility report if the criteria under subsection (c) and subsection (d) are addressed and make a recommendation if the project should be authorized for construction.

Subsection (f) directs the Secretary to assess a non-Federal project entity's financial capability to pay at least 25 percent of rural water supply construction costs and recommend an appropriate Federal and non-Federal cost share.

Subsection (g) requires that the Federal share of any feasibility study carried out under this section shall not exceed 50 percent.

Subsection (h) directs the Secretary to consult with appropriate entities while conducting a feasibility assessment and developing a feasibility report

Section 107 subsection (a) authorizes the Secretary to enter into such agreements and promulgate such regulations as necessary to carry out this title.

Subsection (b) states that this title does not authorize the transfer of pre-existing facilities or components from private to Federal ownership or from Federal to private ownership.

Subsection (c) states that this title does not affect any Federal law associated with a project, or portion of a project constructed under Federal reclamation law.

Subsection (d) directs the Secretary to coordinate with existing Federal and State rural water and wastewater programs to most effectively meet the needs of non-Federal project sponsors.

Subsection (e) states that the approval of every tribe is required before a contract or grant is made to an organization to perform services benefiting more than one Indian tribe.

Subsection (f) states that any facility planned, designed and recommended for construction under this title shall be held by the non-Federal project entity.

Subsection (g) directs the Secretary to expedite appraisal investigations and reports and feasibility investigations and reports if a community has an urgent and compelling water need.

Subsection (h) states that this title has no effect on State water law or an interstate compact governing water and the Secretary shall comply with State water law in carrying out this title.

Subsection (i) states that nothing in this title requires a feasibility study, or imposes any other additional requirements for rural water supply projects or programs authorized before the date of enactment of this Act.

Section 108 subsection (a) authorizes $20,000,000 to be appropriated for this title for fiscal years 2006 through 2015

Subsection (b) requires that not more than $1 million shall be made available to carry out section 104 for fiscal years 2006 and 2007.

Subsection (c) prohibits the use of any funds provided under this section from being used for construction costs.

Section 201 provides the short title, `Twenty-First Century Water Works Act.'

Section 202 defines the terms used in title II of this Act.

Section 203 subsection (a) directs the Secretary to promulgate criteria for eligibility of a project for financial assistance under section 204 and provides inclusions.

Subsection (b) provides that the Secretary may waive any criteria under subsection (a) that the Secretary determines unnecessary.

Subsection (c) states that, subject to the criteria developed under subsection (a), any project authorized under Federal reclamation law prior to the date of enactment of this Act shall be eligible for assistance under this title.

Subsection (d) states that any rural water supply project determined to be feasible under section 106 is eligible for a loan guarantee under section 204.

Section 204 subsection (a) provides that, subject to the availability of appropriations and the eligibility criteria established in section 203, the Secretary may make available loan guarantees to lenders.

Subsection (b) states that loan guarantees made available under this section be on such conditions the Secretary determines appropriate, shall not exceed 90 percent of the cost of the project that is the subject of the loan guarantee, shall provide for amortization of the loan guarantee within not more than 40 years, and shall not be subordinate to other financing.

Subsection (c) states that any prepayment or refinancing of a loan guarantee shall be between the non-Federal borrower and the lender with the consent of the Secretary.

Section 205 subsection (a) sets forth the obligations of the Secretary in the event that the non-Federal borrower defaults.

Subsection (b) states that, if the Secretary makes a payment under subsection (a), the Secretary shall be subrogated to the rights to the recipient of the payment as specified in the loan guarantee or related agreements.

Subsection (c) provides that, under specified circumstances, the Secretary may enter into a contract to pay, and pay, holders of the obligation, on behalf of the non-Federal borrower, from funds appropriated for that purpose, principal and interest payments associated with the obligation.

Section (d) requires that the Secretary inform the Attorney General if the non-Federal borrower defaults on an obligation and directs the Attorney General to take such action as necessary to recover unpaid principal and interest from the non-Federal borrower.

Section 206 subsection (a) requires that the non-Federal borrower be responsible for 100 percent of operations and maintenance costs.

Subsection (b) states that the Secretary may assist the non-Federal borrower in developing an operations and maintenance plan.

Section 207 subsection (a) provides that all facilities constructed under this title shall remain under the control of the non-Federal borrower subject to the terms of the repayment contract.

Subsection (b) provides that nothing in this title affects the title of any reclamation projects authorized prior to the date of enactment of this Act or works associated with existing reclamation projects.

Section 208 provides that nothing in this title affects or preempts State water law or an interstate compact governing water and provides that the Secretary shall comply with State water laws in carrying out this title.

Section 209 provides that the Secretary shall consult with the Secretary of Agriculture prior to promulgating criteria with respect to financial appraisal functions and program administration and the Secretary may enter into a memorandum of agreement with the Secretary of Agriculture to have the Secretary of Agriculture provide those services.

Section 210 provides that the recipient of a loan guarantee shall keep records as required by the Secretary and shall make the records available to the Secretary.

Section 211 provides that all guarantees issued under this section have the full faith and credit of the United States.

Section 212 authorizes such sums as necessary to be appropriated as necessary to carry out this title.

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