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.

October 15, 2003

Mr. DOMENICI introduced the following bill; which was read twice and referred to the Committee on Energy and Natural Resources

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.

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

This Act may be cited as `The Reclamation Rural Water Supply Act of 2003'.

SEC. 2. DEFINITIONS.

In this Act:

(1) CONSTRUCT- The term `construct' means to--

(A) install new infrastructure; and

(B) upgrade or replace existing facilities that are associated with the new infrastructure authorized under this Act.

(2) INDIAN TRIBE- The term `Indian tribe' means any Indian entity that is--

(A) included on the list of recognized tribes that the Secretary publishes in the Federal Register in accordance with section 104 of the Federally Recognized Indian Tribe List Act of 1994 (25 U.S.C. 479a-1); and

(B) recognized by the Secretary as eligible to receive services from the Federal Government.

(3) NON-FEDERAL PROJECT ENTITY- The term `non-Federal project entity' means a State, regional, or local authority, Indian tribe, or other qualifying entity, such as a water conservation district, water conservancy district, or rural water district or association.

(4) PROGRAM- The term `program' means the rural water supply program established under section 3(a).

(5) PROJECT-

(A) IN GENERAL- The term `project' means a water supply project for communities, an Indian tribe, or dispersed homesites with domestic or rural water.

(B) INCLUSION- The term `project' includes incidental livestock watering.

(6) RECLAMATION LAW- The term `Reclamation law' means the Act of June 17, 1902 (32 Stat. 388, chapter 1093), and Acts supplemental to and amendatory of that Act (43 U.S.C. 371 et seq.)).

(7) RECLAMATION STATE- The term `Reclamation State' means each of the States identified in the first section of the Act of June 17, 1902 (43 U.S.C. 391).

(8) SECRETARY- The term `Secretary' means the Secretary of the Interior.

SEC. 3. RURAL WATER SUPPLY PROGRAM.

(a) IN GENERAL- The Secretary, in cooperation with non-Federal project entities, may carry out a rural water supply program to plan, design, and construct projects in Reclamation States.

(b) ELIGIBILITY CRITERIA-

(1) IN GENERAL- The Secretary shall develop and publish in the Federal Register criteria for determining the eligibility of a project for assistance under the program.

(2) CONSIDERATIONS- The criteria developed under paragraph (1) shall take into account such factors as--

(A) whether a project serves--

(i) rural areas and communities; or

(ii) Indian tribes;

(B) whether there is an urgent and compelling need for a project that would--

(i) result in continuous, measurable, and significant water quality benefits;

(ii) address current or future water supply shortages; or

(iii) improve the health or aesthetic quality of water;

(C) whether a project helps meet any applicable legal requirements;

(D) whether a project--

(i) promotes and applies a regional or watershed perspective to water resource management or cross-boundary issues;

(ii) implements an integrated resources management approach;

(iii) increases water management flexibility; or

(iv) forms a partnership with other entities; and

(E) whether a project provides benefits outside the region in which the project is carried out.

(c) COST-SHARING REQUIREMENT-

(1) FEDERAL SHARE- The Federal share of the cost of the planning and construction of a project shall be the amount established by the Secretary in the feasibility report for the project under section 5(c)(1)(D)(i).

(2) NON-FEDERAL SHARE-

(A) IN GENERAL- Except as provided in subparagraph (B), the non-Federal share shall be not less than 25 percent of the cost of planning and construction of the project, but not more than the amount established by the Secretary in the feasibility report for the project under section 5(c)(1)(D)(i).

(B) REDUCED NON-FEDERAL SHARE- The Secretary may reduce the non-Federal share of the cost of the planning and construction of a project under subparagraph (A) if the Secretary determines that the amount of the non-Federal share required by that subparagraph would result in economic hardship for the non-Federal project entity.

(C) LIMITATION- Grants from other Federal sources shall not be credited toward the non-Federal share required by this paragraph.

SEC. 4. APPRAISAL INVESTIGATIONS.

(a) IN GENERAL- On request of a non-Federal project entity, the Secretary, in cooperation with the non-Federal project entity and in consultation with appropriate State, regional, local, and tribal authorities, may conduct an appraisal investigation of a project to determine whether--

(1) the project meets the criteria developed under section (3)(b); and

(2) the Secretary should initiate a feasibility study under section 5(a).

(b) REPORT- On completion of the investigation under subsection (a), the Secretary shall prepare an appraisal report that includes any recommendations of the Secretary with respect to whether a feasibility study should be initiated for the project under section 5(a).

(c) COSTS- The Secretary shall pay the costs of any appraisal investigations conducted under this section.

SEC. 5. FEASIBILITY STUDIES.

(a) IN GENERAL- The Secretary, in cooperation with a non-Federal project entity, may carry out studies to determine the feasibility of rural water supply systems recommended for study under section 4(b).

(b) STUDY CONSIDERATIONS- In conducting a feasibility study under this section, the Secretary shall consider--

(1) the need for the proposed project;

(2) short- and long-term water demand and supplies in the study area;

(3) an evaluation of whether the resources in the study area are capable of providing a safe and reliable source of potable water to the communities and rural areas to be served;

(4) any reasonable alternatives to the proposed project (including nonstructural alternatives) that satisfy the need for action, including an alternative that is within the ability of the non-Federal project entity to pay operation, maintenance, and repair costs of the proposed project;

(5) the economic feasibility and cost effectiveness of the proposed project;

(6) impacts of the proposed project on the natural and human environment;

(7) appropriate water conservation measures; and

(8) the financial ability of the non-Federal project entity to pay--

(A) the non-Federal share of any planning and construction costs of the proposed project; and

(B) 100 percent of the operation, maintenance, and replacement costs allocated under subsection (c)(1)(C)(i).

(c) REPORT-

(1) IN GENERAL- On completion of a feasibility study under subsection (a), the Secretary shall prepare a report that--

(A) describes the engineering, environmental, and economic activities of the Secretary carried out under the study;

(B) takes into consideration--

(i) the range of potential solutions for, and the circumstances and needs of, the area to be served by the proposed project;

(ii) the potential benefits to the people of the study area; and

(iii) appropriate water conservation measures;

(C) includes a schedule that identifies--

(i) the amount of operation, maintenance, and replacement costs that should be allocated to each non-Federal project entity participating in the project; and

(ii) the current and expected financial ability of each non-Federal project entity to pay the allocated operation, maintenance, and replacement costs;

(D)(i) specifies the Federal and non-Federal share of the planning and construction costs of the project; and

(ii) allocates the non-Federal share among project beneficiaries; and

(E) includes the recommendations of the Secretary as to whether the project should be carried out under this Act.

(2) SUBMISSION TO CONGRESS- With respect to any project that the Secretary recommends under paragraph (1)(E), the Secretary shall submit to Congress--

(A) the feasibility report for the proposed project prepared under paragraph (1);

(B) any environmental reports associated with the proposed project; and

(C) a request to develop and construct the proposed project, as appropriate.

(d) PRIORITIES- The Secretary shall establish priorities for carrying out projects under this Act based on--

(1) the extent to which the project takes advantage of--

(A) economic incentives; and

(B) the use of market-based mechanisms;

(2) the cost benefit of the project versus other alternatives such as desalination;

(3) whether non-Federal project entities have adequate fiscal controls in place to manage the project; and

(4) the extent to which the project involves partnerships.

(e) COST-SHARING REQUIREMENT-

(1) FEDERAL SHARE- The Federal share of the cost of a feasibility study carried out under this section shall not exceed 50 percent of the study costs.

(2) FORM OF NON-FEDERAL SHARE- The non-Federal share under paragraph (1) may be in the form of any in-kind services that the Secretary determines would contribute substantially toward the conduct and completion of the study.

(f) REIMBURSEMENT OF COSTS- If a project is constructed under the program, the Federal share of feasibility studies shall be--

(1) considered to be project costs; and

(2) reimbursed in accordance with Reclamation law.

SEC. 6. OPERATION, MAINTENANCE, AND REPLACEMENT COSTS.

(a) IN GENERAL- To be eligible to carry out a project under this Act, a non-Federal project entity shall establish, to the satisfaction of the Secretary, that the non-Federal project entity has the ability to pay all operation, maintenance, and replacement costs of the project facilities.

(b) PLAN- The non-Federal project entity, in consultation with the Secretary, shall develop an operation, maintenance, and replacement plan to provide the necessary framework to assist the non-Federal project entity in establishing rates and fees for project beneficiaries.

SEC. 7. MISCELLANEOUS PROVISIONS.

(a) AUTHORITY OF SECRETARY- The Secretary may enter into contracts, financial assistance agreements, and such other agreements, and promulgate such regulations, as are necessary to carry out this Act.

(b) LIMITATION ON USE OF FUNDS- None of the funds made available to the Secretary for planning or construction of a rural water supply project developed under the program may be used to plan or construct facilities used to supply water for irrigation.

(c) TITLE TO PROJECTS- Title to the components of rural water supply projects planned, designed, and constructed under the program shall be held by the non-Federal project entity.

SEC. 8. EFFECT ON FEDERAL RECLAMATION LAW.

Nothing in this Act supersedes or amends--

(1) Reclamation law; or

(2) any Federal law associated with a project, or portion of a project constructed under Reclamation law.

SEC. 9. AUTHORIZATION OF APPROPRIATIONS.

(a) IN GENERAL- There is authorized to be appropriated to carry out this Act $70,000,000 for fiscal year 2004 and each fiscal year thereafter.

(b) CONSTRUCTION COST INDEXING-

(1) IN GENERAL- Any amounts appropriated for the planning and construction of projects under this Act shall include such sums as are necessary to defray increases in development costs reflected in appropriate engineering cost indices after the completion date of the applicable feasibility report, to remain available until expended.

(2) COST SHARING- The Federal and non-Federal share of cost increases due to inflation shall be allocated in amounts that are proportionate to the allocation determined under section 3(c).

END