[Congressional Bills 110th Congress]
[From the U.S. Government Publishing Office]
[S. 3617 Placed on Calendar Senate (PCS)]






                                                      Calendar No. 1092
110th CONGRESS
  2d Session
                                S. 3617

                          [Report No. 110-509]

To amend the Federal Water Pollution Control Act and the Safe Drinking 
Water Act to improve water and wastewater infrastructure in the United 
                                States.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

           September 26 (legislative day, September 17), 2008

Mrs. Boxer, from the Committee on Environment and Public Works reported 
  the following original bill; which was read twice and placed on the 
                                calendar

_______________________________________________________________________

                                 A BILL


 
To amend the Federal Water Pollution Control Act and the Safe Drinking 
Water Act to improve water and wastewater infrastructure in the United 
                                States.

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

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``Water 
Infrastructure Financing Act''.
    (b) Table of Contents.--The table of contents of this Act is as 
follows:

Sec. 1. Short title; table of contents.
                TITLE I--WATER POLLUTION INFRASTRUCTURE

Sec. 101. Technical assistance for rural small treatment works and 
                            medium treatment works.
Sec. 102. Projects eligible for assistance.
Sec. 103. Affordability.
Sec. 104. Water pollution control revolving loan funds.
Sec. 105. Transferability of funds.
Sec. 106. Noncompliance.
Sec. 107. Negotiation of contracts.
Sec. 108. Allotment of funds.
Sec. 109. Authorization of appropriations.
Sec. 110. Sewer overflow control grants.
Sec. 111. Capitalization grant agreements.
Sec. 112. Critical water infrastructure projects.
              TITLE II--SAFE DRINKING WATER INFRASTRUCTURE

Sec. 201. Contaminant prevention, detection, and response.
Sec. 202. Drinking water technical assistance for communities.
Sec. 203. Preservation of employee labor standards.
Sec. 204. Preconstruction work.
Sec. 205. Priority system requirements.
Sec. 206. Affordability.
Sec. 207. Safe drinking water revolving loan funds.
Sec. 208. Other authorized activities.
Sec. 209. Authorization of appropriations.
Sec. 210. Negotiation of contracts.
Sec. 211. Critical drinking water infrastructure projects.
Sec. 212. District of Columbia lead service line replacement.
                        TITLE III--MISCELLANEOUS

Sec. 301. Definitions.
Sec. 302. Program for water quality enhancement and management.
Sec. 303. Agricultural pollution control technology grant program.
Sec. 304. State revolving fund review process.
Sec. 305. Cost of service study.
Sec. 306. Water management study.
Sec. 307. Reduction in authorization of appropriations.

                TITLE I--WATER POLLUTION INFRASTRUCTURE

SEC. 101. TECHNICAL ASSISTANCE FOR RURAL SMALL TREATMENT WORKS AND 
              MEDIUM TREATMENT WORKS.

    (a) In General.--Title II of the Federal Water Pollution Control 
Act (33 U.S.C. 1281 et seq.) is amended by adding at the end the 
following:

``SEC. 222. TECHNICAL ASSISTANCE FOR RURAL SMALL TREATMENT WORKS AND 
              MEDIUM TREATMENT WORKS.

    ``(a) Definitions.--In this section:
            ``(1) Decentralized wastewater system.--
                    ``(A) In general.--The term `decentralized 
                wastewater system' means a wastewater treatment system 
                that is at or near a site at which wastewater is 
                generated.
                    ``(B) Inclusions.--The term `decentralized 
                wastewater system' includes a system that provides 
                for--
                            ``(i) nonpotable reuse of treated effluent; 
                        or
                            ``(ii) energy and nutrient recovery from 
                        wastewater constituents.
            ``(2) Medium treatment works.--The term `medium treatment 
        works' means a publicly owned treatment works serving more than 
        10,000 but fewer than 100,000 individuals.
            ``(3) Qualified nonprofit technical assistance provider.--
        The term `qualified nonprofit technical assistance provider' 
        means a qualified nonprofit technical assistance provider of 
        water and wastewater services to small or medium-sized 
        communities that provides technical assistance (including 
        circuit rider, multi-State regional assistance programs, and 
        training and preliminary engineering evaluations) to owners and 
        operators of small treatment works or medium treatment works 
        that may include State agencies.
            ``(4) Small treatment works.--The term `small treatment 
        works' means a publicly owned treatment works serving not more 
        than 10,000 individuals.
    ``(b) Grant Program.--
            ``(1) In general.--The Administrator may make grants on a 
        competitive basis to qualified nonprofit technical assistance 
        providers that are qualified to provide assistance on a broad 
        range of wastewater and stormwater approaches--
                    ``(A) to assist owners and operators of small 
                treatment works and medium treatment works to plan, 
                develop, and obtain financing for eligible projects 
                described in section 603(c) or 518(c);
                    ``(B) to provide financial assistance, in 
                consultation with the State in which the assistance is 
                provided, to owners and operators of small treatment 
                works and medium treatment works for predevelopment 
                costs (including costs for planning, design, and 
                associated preconstruction activities, such as 
                activities relating directly to the siting of the 
                facility and related elements) associated with 
                stormwater or wastewater infrastructure projects or 
                short-term costs incurred for equipment replacement 
                that is not part of regular operation and maintenance 
                activities for existing stormwater or wastewater 
                systems, if the amount of assistance for any single 
                project does not exceed $50,000;
                    ``(C) to provide technical assistance and training 
                for owners and operators of small treatment works and 
                medium treatment works to enable those treatment works 
                and systems to protect water quality and achieve and 
                maintain compliance with this Act; and
                    ``(D) to disseminate information to owners and 
                operators of small treatment works and medium treatment 
                works, with respect to planning, design, construction, 
                and operation of treatment works, small municipal 
                separate storm sewer systems, and decentralized 
                wastewater treatment systems.
            ``(2) Distribution of grant.--In carrying out this 
        subsection, the Administrator shall ensure, to the maximum 
        extent practicable, that technical assistance provided using 
        funds from a grant under paragraph (1) is made available in 
        each State.
            ``(3) Consultation.--As a condition of receiving a grant 
        under this subsection, a qualified nonprofit technical 
        assistance provider shall agree to consult with each State in 
        which grant funds are to be expended before the grant funds are 
        expended in the State.
            ``(4) Annual report.--Not later than 60 days after the end 
        of each fiscal year, a qualified nonprofit technical assistance 
        provider that receives a grant under this subsection shall 
        submit to the Administrator a report that--
                    ``(A) describes the activities of the qualified 
                nonprofit technical assistance provider using grant 
                funds received under this subsection for the fiscal 
                year; and
                    ``(B) specifies--
                            ``(i) the number of communities served;
                            ``(ii) the sizes of those communities; and
                            ``(iii) the type of assistance provided by 
                        the qualified nonprofit technical assistance 
                        provider.
    ``(c) Authorization of Appropriations.--There are authorized to be 
appropriated to carry out this section--
            ``(1) for grants for small treatment works, $25,000,000 for 
        each of fiscal years 2009 through 2013; and
            ``(2) for grants for medium treatment works, $15,000,000 
        for each of fiscal years 2009 through 2013.''.
    (b) Guidance for Small Systems.--Section 602 of the Federal Water 
Pollution Control Act (33 U.S.C. 1382) is amended by adding at the end 
the following:
    ``(c) Guidance for Small Systems.--
            ``(1) Definition of small system.--In this subsection, the 
        term `small system' means a system--
                    ``(A) for which a municipality or intermunicipal, 
                interstate, or State agency seeks assistance under this 
                title; and
                    ``(B) that serves a population of not more than 
                10,000 individuals.
            ``(2) Simplified procedures.--Not later than 1 year after 
        the date of enactment of this subsection, the Administrator 
        shall assist the States in establishing simplified procedures 
        for small systems to obtain assistance under this title.
            ``(3) Publication of manual.--Not later than 1 year after 
        the date of enactment of this subsection, after providing 
        notice and opportunity for public comment, the Administrator 
        shall publish--
                    ``(A) a manual to assist small systems in obtaining 
                assistance under this title; and
                    ``(B) in the Federal Register, notice of the 
                availability of the manual.''.

SEC. 102. PROJECTS ELIGIBLE FOR ASSISTANCE.

    Section 603 of the Federal Water Pollution Control Act (33 U.S.C. 
1383) is amended by striking subsection (c) and inserting the 
following:
    ``(c) Projects Eligible for Assistance.--Funds in each State water 
pollution control revolving fund shall be used only by a municipality 
or an intermunicipal, interstate, or State agency (or, for the purpose 
of paragraph (1), by either of those entities or a private treatment 
works or decentralized wastewater system that principally treats 
municipal wastewater or domestic sewage)--
            ``(1) to provide financial assistance for construction 
        activities (including expansion to meet needs of existing 
        development), including planning, design, associated 
        preconstruction planning activities (as defined in section 212) 
        and implementation measures to control, manage, reduce, treat, 
        infiltrate, or reuse municipal stormwater, the primary purpose 
        of which is the protection, preservation, or enhancement of 
        water quality to support public purposes (including the 
        procurement and use of equipment to support minimum measures, 
        such as street sweeping and storm drain system cleaning, and 
        acquisition of other land and interests in land to meet the 
        needs of existing development that are necessary for those 
        activities and measures);
            ``(2) to implement a management program established under 
        section 319;
            ``(3) to develop and implement a conservation and 
        management plan under section 320;
            ``(4) to increase the security of wastewater treatment 
        works (excluding any expenditure for operations or 
        maintenance);
            ``(5) to carry out water conservation or efficiency 
        projects, the primary purpose of which is the protection, 
        preservation, or enhancement of water quality to support public 
        purposes;
            ``(6) to implement measures to integrate water resource 
        management planning and implementation;
            ``(7) to carry out water and wastewater reuse, reclamation, 
        and recycling projects, the primary purpose of which is the 
        protection, preservation, or enhancement of water quality to 
        support public purposes; and
            ``(8) for capital costs associated with monitoring 
        equipment for combined or sanitary sewer overflows.''.

SEC. 103. AFFORDABILITY.

    (a) In General.--Section 603 of the Federal Water Pollution Control 
Act (33 U.S.C. 1383) is amended--
            (1) by redesignating subsections (e) through (h) as 
        subsections (g) through (j), respectively;
            (2) in subsection (d)--
                    (A) in paragraph (1)--
                            (i) in subparagraph (A), by striking ``20 
                        years'' and inserting ``the lesser of 30 years 
                        or the design life of the project to be 
                        financed with the proceeds of the loan''; and
                            (ii) in subparagraph (B), by striking ``not 
                        later than 20 years after project completion'' 
                        and inserting ``upon the expiration of the term 
                        of the loan'';
                    (B) in paragraph (6), by striking ``and'' at the 
                end; and
                    (C) in paragraph (7), by striking ``title, except 
                that'' and all that follows and inserting the 
                following:
        ``title, except that--
                    ``(A) such amounts shall not exceed 6 percent of 
                all grant awards to the fund under this title; and
                    ``(B) if there is no appropriation for a fiscal 
                year, the total amount of the reasonable cost of 
                administering the fund and conducting activities under 
                this title shall not exceed 6 percent of all loan 
                awards made by the State for that fiscal year; and
            ``(8) as a source of revenue (restricted solely to interest 
        earnings of the fund) or security for payment of the principal 
        and interest on revenue or general obligation bonds issued by 
        the State to provide matching funds under section 602(b)(2), if 
        the proceeds of the sale of the bonds will be deposited in the 
        fund.''; and
            (3) by inserting after subsection (d) the following:
    ``(e) Additional Assistance for Disadvantaged Communities.--
            ``(1) Definition of disadvantaged community.--In this 
        subsection, the term `disadvantaged community' means a 
        community with a service area, or portion of a service area, of 
        a treatment works that meets affordability criteria established 
        after public review and comment by the State in which the 
        treatment works is located.
            ``(2) Loan subsidy.--Notwithstanding any other provision of 
        this section, in a case in which the State makes a loan from 
        the water pollution control revolving loan fund in accordance 
        with subsection (c) to a disadvantaged community or a community 
        that the State expects to become a disadvantaged community as 
        the result of a proposed project, the State may provide 
        additional subsidization, including--
                    ``(A) the forgiveness of all or a portion of the 
                principal of the loan; and
                    ``(B) a negative interest rate on the loan.
            ``(3) Total amount of subsidies.--For each fiscal year, the 
        total amount of loan subsidies made by the State pursuant to 
        this subsection may not exceed 30 percent of the amount of the 
        capitalization grant received by the State for the fiscal year.
            ``(4) Information.--The Administrator may publish 
        information to assist States in establishing affordability 
        criteria described in paragraph (1).
    ``(f) Cost-Saving Water Treatment and Efficiency Improvements.--
Subject to subsection (e)(3), in providing a loan for a project under 
this section, a State may forgive repayment of such portion of the loan 
amount, not to exceed 5 percent, as is equal to the percentage of the 
project that is devoted to alternative approaches to wastewater and 
stormwater controls (including nonstructural methods) such as projects 
that treat or minimize sewage or urban stormwater discharges using--
            ``(1) decentralized or distributed stormwater controls;
            ``(2) decentralized wastewater treatment;
            ``(3) low-impact development technologies and nonstructural 
        approaches;
            ``(4) stream buffers;
            ``(5) wetland restoration and enhancement;
            ``(6) actions to minimize the quantity of and direct 
        connections to impervious surfaces;
            ``(7) soil and vegetation, or other permeable materials;
            ``(8) actions that increase efficient water use, water 
        conservation, or water reuse.''.
    (b) Conforming Amendment.--Section 221(d) of the Federal Water 
Pollution Control Act (33 U.S.C. 1301(d)) is amended in the second 
sentence by striking ``603(h)'' and inserting ``603(j)''.

SEC. 104. WATER POLLUTION CONTROL REVOLVING LOAN FUNDS.

    Section 603 of the Federal Water Pollution Control Act (33 U.S.C. 
1383) is amended by striking subsection (i) (as redesignated by section 
103(a)(1)) and inserting the following:
    ``(i) Priority System Requirement.--
            ``(1) Definitions.--In this subsection:
                    ``(A) Restructuring.--The term `restructuring' 
                means--
                            ``(i) the consolidation of management 
                        functions or ownership with another facility; 
                        or
                            ``(ii) the formation of cooperative 
                        partnerships.
                    ``(B) Traditional wastewater approach.--The term 
                `traditional wastewater approach' means a managed 
                system used to collect and treat wastewater from an 
                entire service area consisting of--
                            ``(i) collection sewers;
                            ``(ii) a centralized treatment plant using 
                        biological, physical, or chemical treatment 
                        processes; and
                            ``(iii) a direct point source discharge to 
                        surface water.
            ``(2) Priority system.--In providing financial assistance 
        from the water pollution control revolving fund of the State, 
        the State shall establish a priority system that--
                    ``(A) gives greater weight to an application for 
                assistance by the owner or operator of a treatment 
                works if the application includes--
                            ``(i) an inventory of assets, including a 
                        description of the condition of those assets;
                            ``(ii) a schedule for replacement of the 
                        assets;
                            ``(iii) a financing plan that factors in 
                        all lifecycle costs indicating sources of 
                        revenue from ratepayers, grants, bonds, other 
                        loans, and other sources to meet the costs;
                            ``(iv) a review of options for 
                        restructuring the treatment works; or
                            ``(v) approaches other than a traditional 
                        wastewater approach that treat or minimize 
                        sewage or urban stormwater discharges using--
                                    ``(I) decentralized or distributed 
                                stormwater controls;
                                    ``(II) decentralized wastewater 
                                treatment;
                                    ``(III) low-impact development 
                                technologies and nonstructural 
                                approaches;
                                    ``(IV) stream buffers;
                                    ``(V) wetland restoration and 
                                enhancement;
                                    ``(VI) actions to minimize the 
                                quantity of and direct connections to 
                                impervious surfaces;
                                    ``(VII) soil and vegetation, or 
                                other permeable materials; or
                                    ``(VIII) actions that increase 
                                efficient water use, water 
                                conservation, or water reuse;
                            ``(vi) a demonstration of consistency with 
                        State, regional, and municipal watershed plans, 
                        water conservation and efficiency plans, or 
                        integrated water resource management plans;
                            ``(vii) a proposal by the applicant 
                        demonstrating flexibility through alternative 
                        means to carry out responsibilities under 
                        Federal regulations, that may include watershed 
                        permitting and other innovative management 
                        approaches, while achieving results that--
                                    ``(I) the State, in the case of a 
                                permit program approved under section 
                                402, determines will meet permit 
                                requirements; or
                                    ``(II) the Administrator determines 
                                are measurably superior when compared 
                                to regulatory standards;
                    ``(B) takes into consideration appropriate 
                chemical, physical, and biological data relating to 
                water quality that the State considers reasonably 
                available and of sufficient quality;
                    ``(C) provides for public notice and opportunity to 
                comment on the establishment of the priority system and 
                the summary under subparagraph (D);
                    ``(D) provides for the publication, not less than 
                biennially in summary form, of a description of 
                projects in the State that are eligible for assistance 
                under this title that indicates--
                            ``(i) the priority assigned to each project 
                        under the priority system of the State; and
                            ``(ii) the funding schedule for each 
                        project, to that extent the information is 
                        available; and
                    ``(E) ensures that projects undertaken with 
                assistance under this title are designed to achieve, as 
                determined by the State, the optimum water quality 
                management, consistent with the public health and water 
                quality goals and requirements of this Act.''.

SEC. 105. TRANSFERABILITY OF FUNDS.

    Section 603 of the Federal Water Pollution Control Act (33 U.S.C. 
1383) (as amended by section 103(a)(1)) is amended by adding at the end 
the following:
    ``(k) Transfer of Funds.--
            ``(1) In general.--The Governor of a State may--
                    ``(A)(i) reserve not more than 33 percent of a 
                capitalization grant made under this title; and
                    ``(ii) add the funds reserved to any funds provided 
                to the State under section 1452 of the Safe Drinking 
                Water Act (42 U.S.C. 300j-12); and
                    ``(B)(i) reserve for any year an amount that does 
                not exceed the amount that may be reserved under 
                subparagraph (A) for that year from capitalization 
                grants made under section 1452 of that Act (42 U.S.C. 
                300j-12); and
                    ``(ii) add the reserved funds to any funds provided 
                to the State under this title.
            ``(2) State match.--Funds reserved under this subsection 
        shall not be considered to be a State contribution for a 
        capitalization grant required under this title or section 
        1452(b) of the Safe Drinking Water Act (42 U.S.C. 300j-
        12(b)).''.

SEC. 106. NONCOMPLIANCE.

    Section 603 of the Federal Water Pollution Control Act (33 U.S.C. 
1383) (as amended by section 105) is amended by adding at the end the 
following:
    ``(l) Noncompliance.--
            ``(1) In general.--Except as provided in paragraph (2), no 
        assistance (other than assistance that is to be used by a 
        treatment works solely for planning, design, or security 
        purposes) shall be provided under this title to the owner or 
        operator of a treatment works that has been in significant 
        noncompliance with any requirement of this Act for any of the 4 
        quarters during the preceding 8 quarters, unless the treatment 
        works is in compliance with an enforceable administrative order 
        to effect compliance with the requirement.
            ``(2) Exception.--An owner or operator of a treatment works 
        that is determined under paragraph (1) to be in significant 
        noncompliance with a requirement described in that paragraph 
        may receive assistance under this title if the Administrator 
        and the State providing the assistance determine that--
                    ``(A) the entity conducting the enforcement action 
                on which the determination of significant noncompliance 
                is based has determined that the use of assistance 
                would enable the owner or operator of the treatment 
                works to take corrective action toward resolving the 
                violations; or
                    ``(B) the entity conducting the enforcement action 
                on which the determination of significant noncompliance 
                is based has determined that the assistance would be 
                used by the owner or operator of the treatment works in 
                order to assist owners and operators in making progress 
                towards compliance.''.

SEC. 107. NEGOTIATION OF CONTRACTS.

    Section 603 of the Federal Water Pollution Control Act (33 U.S.C. 
1383) (as amended by section 106) is amended by adding at the end the 
following:
    ``(m) Negotiation of Contracts.--
            ``(1) In general.--A contract to be carried out using funds 
        directly made available by a capitalization grant under this 
        section for program management, construction management, 
        feasibility studies, preliminary engineering, design, 
        engineering, surveying, mapping, or architectural or related 
        services shall be negotiated in the same manner as--
                    ``(A) a contract for architectural and engineering 
                services is negotiated under chapter 11 of title 40, 
                United States Code; or
                    ``(B) an equivalent State qualifications-based 
                requirement (as determined by the Governor of the 
                State).
            ``(2) Exemption for small communities.--Paragraph (1) shall 
        not apply to a contract described in that paragraph for program 
        management, construction management, feasibility studies, 
        preliminary engineering, design, engineering, surveying, 
        mapping, or architectural or related services for a community 
        of 10,000 or fewer individuals.''.

SEC. 108. ALLOTMENT OF FUNDS.

    Section 604 of the Federal Water Pollution Control Act (33 U.S.C. 
1384) is amended by striking subsection (b) and inserting the 
following:
    ``(b) Reservation of Funds.--
            ``(1) Planning.--Each State may reserve for each fiscal 
        year the greater of 2 percent of the sums allotted to the State 
        under this section for the fiscal year, or $100,000, to carry 
        out planning under sections 205(j) and 303(e).
            ``(2) Indian tribes.--Of the total amount of funds made 
        available under paragraph (1), 1.5 percent shall be allocated 
        to Indian tribes (as defined in section 518(h)).''.

SEC. 109. AUTHORIZATION OF APPROPRIATIONS.

    The Federal Water Pollution Control Act is amended by striking 
section 607 (33 U.S.C. 1387) and inserting the following:

``SEC. 607. AUTHORIZATION OF APPROPRIATIONS.

    ``(a) In General.--There are authorized to be appropriated to carry 
out this title--
            ``(1) $3,200,000,000 for each of fiscal years 2008 and 
        2009;
            ``(2) $3,600,000,000 for fiscal year 2010;
            ``(3) $4,000,000,000 for fiscal year 2011; and
            ``(4) $6,000,000,000 for fiscal year 2012.
    ``(b) Availability.--Amounts made available under this section 
shall remain available until expended.
    ``(c) Reservation for Needs Surveys.--Of the amount made available 
under subsection (a) to carry out this title for a fiscal year, the 
Administrator may reserve not more than $1,000,000 for the fiscal year, 
to remain available until expended, to pay the costs of conducting 
needs surveys under section 516(b)(1)(B).''.

SEC. 110. SEWER OVERFLOW CONTROL GRANTS.

    (a) Sewer Overflow Control Grants.--Section 221 of the Federal 
Water Pollution Control Act (33 U.S.C. 1301) is amended--
            (1) in subsection (a), by striking ``In General'' and all 
        that follows through ``(2) subject to subsection (g), the 
        Administrator may'' and inserting the following:
    ``(a) In General.--The Administrator may--
            ``(1) make grants to States for the purpose of providing 
        grants to a municipality or municipal entity for planning, 
        design, and construction of treatment works to intercept, 
        transport, control, or treat municipal combined sewer overflows 
        and sanitary sewer overflows; and
            ``(2) subject to subsection (g),''; and
            (2) by striking subsections (e) through (g) and inserting 
        the following:
    ``(e) Administrative Requirements.--
            ``(1) In general.--Subject to paragraph (2), a project that 
        receives grant assistance under subsection (a) shall be carried 
        out subject to the same requirements as a project that receives 
        assistance from a State water pollution control revolving fund 
        established pursuant to title VI.
            ``(2) Determination of governor.--The requirement described 
        in paragraph (1) shall not apply to a project that receives 
        grant assistance under subsection (a) to the extent that the 
        Governor of the State in which the project is located 
        determines that a requirement described in title VI is 
        inconsistent with the purposes of this section.
    ``(f) Authorization of Appropriations.--There are authorized to be 
appropriated to carry out this section, to remain available until 
expended--
            ``(1) $375,000,000 for fiscal year 2008;
            ``(2) $375,000,000 for fiscal year 2009;
            ``(3) $375,000,000 for fiscal year 2010;
            ``(4) $375,000,000 for fiscal year 2011; and
            ``(5) $500,000,000 for fiscal year 2012.
    ``(g) Allocation of Funds.--
            ``(1) Fiscal year 2008 and 2009.--For each of fiscal years 
        2008 and 2009, subject to subsection (h), the Administrator 
        shall use the amounts made available to carry out this section 
        to provide grants to municipalities and municipal entities 
        under subsection (a)(2)--
                    ``(A) in accordance with the priority criteria 
                described in subsection (b); and
                    ``(B) with additional priority given to proposed 
                projects that involve the use of--
                            ``(i) nonstructural, low-impact 
                        development;
                            ``(ii) water conservation, efficiency, or 
                        reuse; or
                            ``(iii) other decentralized stormwater or 
                        wastewater approaches to minimize flows into 
                        the sewer systems.
            ``(2) Fiscal year 2010 and thereafter.--For fiscal year 
        2010 and each fiscal year thereafter, subject to subsection 
        (h), the Administrator shall use the amounts made available to 
        carry out this section to provide grants to States under 
        subsection (a)(1) in accordance with a formula that--
                    ``(A) shall be established by the Administrator, 
                after providing notice and an opportunity for public 
                comment; and
                    ``(B) allocates to each State a proportional share 
                of the amounts based on the total needs of the State 
                for municipal combined sewer overflow controls and 
                sanitary sewer overflow controls, as identified in the 
                most recent survey--
                            ``(i) conducted under section 210; and
                            ``(ii) included in a report required under 
                        section 516(b)(1)(B).''.
    (b) Reports.--Section 221(i) of the Federal Water Pollution Control 
Act (33 U.S.C. 1301(i)) is amended in the first sentence by striking 
``2003'' and inserting ``2010''.

SEC. 111. CAPITALIZATION GRANT AGREEMENTS.

    Section 602(b) of the Federal Water Pollution Control Act (33 
U.S.C. 1382(b)) is amended by striking paragraph (6) and inserting the 
following:
            ``(6) treatment works eligible under section 603(c) that 
        are constructed, in whole or in part, using funds made 
        available by a State loan fund under this title shall meet the 
        requirements of section 513 in the same manner as treatment 
        works constructed using assistance provided under title II;''.

SEC. 112. CRITICAL WATER INFRASTRUCTURE PROJECTS.

    (a) Establishment.--The Administrator of the Environmental 
Protection Agency (referred to in this section as the 
``Administrator'') shall establish a program under which grants are 
provided to eligible entities for use in carrying out projects and 
activities the primary purpose of which is watershed restoration 
through the protection or improvement of water quality.
    (b) Project Selection.--
            (1) In general.--The Administrator may provide funds under 
        this section to an eligible entity to carry out an eligible 
        project described in paragraph (3).
            (2) Equitable distribution.--The Administrator shall ensure 
        an equitable distribution of projects under this section, 
        taking into account cost and number of requests for each 
        category listed in paragraph (3).
            (3) Eligible projects.--A project that is eligible to be 
        carried out using funds provided under this section may include 
        projects that are included in the intended use plan of the 
        State developed in accordance with section 606(c) of the 
        Federal Water Pollution Control Act (33 U.S.C. 1386(c)).
    (c) Local Participation.--In prioritizing projects for 
implementation under this section, the Administrator shall consult 
with, and consider the priorities of--
            (1) affected State and local governments; and
            (2) public and private entities that are active in 
        watershed planning and restoration.
    (d) Cost Sharing.--Before carrying out any project under this 
section, the Administrator shall enter into an agreement with 1 or more 
non-Federal interests that shall require the non-Federal interests--
            (1) to pay 45 percent of the total costs of the project, 
        which may include services, materials, supplies, or other in-
        kind contributions;
            (2) to provide any land, easements, rights-of-way, and 
        relocations necessary to carry out the project; and
            (3) to pay 100 percent of any operation, maintenance, 
        repair, replacement, and rehabilitation costs associated with 
        the project.
    (e) Waiver.--The Administrator may waive the requirement to pay the 
non-Federal share of the cost of carrying out an eligible activity 
using funds from a grant provided under this section if the 
Administrator determines that an eligible entity is unable to pay, or 
would experience significant financial hardship if required to pay, the 
non-Federal share.
    (f) Authorization of Appropriations.--There is authorized to be 
appropriated to carry out this section $50,000,000 for each of fiscal 
years 2008 through 2012.

              TITLE II--SAFE DRINKING WATER INFRASTRUCTURE

SEC. 201. CONTAMINANT PREVENTION, DETECTION, AND RESPONSE.

    Section 1434 of the Safe Drinking Water Act (42 U.S.C. 300i-3) is 
amended by striking subsection (b) and inserting the following:
    ``(b) Report.--Not later than 180 days after the date of enactment 
of the Water Infrastructure Financing Act, the Administrator shall 
submit to Congress a report that includes--
            ``(1) a description of the progress made as of that date in 
        implementing this section; and
            ``(2) a description of any impediments to that 
        implementation identified by the Administrator, including--
                    ``(A) difficulty in coordinating the implementation 
                with other Federal, State, or local agencies or 
                organizations;
                    ``(B) insufficient funding for effective 
                implementation;
                    ``(C) a lack of authorization to take certain 
                actions (including the authority to hire necessary 
                personnel) required to carry out the implementation; 
                and
                    ``(D) technological impediments to developing the 
                methods, means, and equipment specified in subsection 
                (a)(1).
    ``(c) Implementation Plan.--The Administrator shall develop and 
carry out an implementation plan for this section consistent with 
actions taken to date and incorporating the results of the report under 
subsection (b).
    ``(d) Funding.--There is authorized to be appropriated to carry out 
this section $7,500,000 for each of fiscal years 2008 through 2012.''.

SEC. 202. DRINKING WATER TECHNICAL ASSISTANCE FOR COMMUNITIES.

    Section 1442(e) of the Safe Drinking Water Act (42 U.S.C. 300j-
1(e)) is amended--
            (1) in the first sentence, by striking ``The Administrator 
        may provide'' and inserting the following:
            ``(1) Public water systems.--The Administrator may 
        provide'';
            (2) in the second sentence, by striking ``Such assistance'' 
        and inserting the following:
            ``(2) Types of assistance.--Such assistance'';
            (3) in the third sentence, by striking ``The Administrator 
        shall ensure'' and inserting the following:
            ``(3) Availability.--The Administrator shall ensure'';
            (4) in the fourth sentence, by striking ``Each nonprofit'' 
        and inserting the following:
            ``(4) Requirement applicable to nonprofit organizations.--
        Each nonprofit''; and
            (5) by striking the fifth sentence and all that follows and 
        inserting the following:
            ``(5) Priority.--In providing grants under this section, 
        the Administrator shall give priority to small systems 
        organizations that, as determined by the Administrator, are 
        qualified and will be the most effective at assisting those 
        small systems that have the greatest need (or a majority of 
        need) in the States.
            ``(6) Wells and well systems.--
                    ``(A) In general.--The Administrator shall provide 
                grants to nonprofit organizations to provide technical 
                assistance to communities and individuals regarding the 
                design, operation, construction, and maintenance of 
                household wells and small shared well-systems that 
                provide drinking water.
                    ``(B) Form of assistance.--Technical assistance 
                referred to in subparagraph (A) may include--
                            ``(i) training and education;
                            ``(ii) operation of a hotline; and
                            ``(iii) the conduct of other activities 
                        relating to the design and construction of 
                        household, shared, and small water well systems 
                        in rural areas.
                    ``(C) Priority.--Subject to paragraph (5), in 
                providing grants under this section, the Administrator 
                shall give priority to applicants that, as determined 
                by the Administrator--
                            ``(i) are qualified; and
                            ``(ii) have demonstrated experience in 
                        providing similar technical assistance and in 
                        developing similar projects.
                    ``(D) Authorization of appropriations.--There is 
                authorized to be appropriated to carry out this 
                paragraph $7,500,000 for each of fiscal years 2009 
                through 2013.
            ``(7) Funding.--
                    ``(A) Authorization of appropriations.--There is 
                authorized to be appropriated to the Administrator to 
                carry out this subsection (other than paragraph (6)) 
                $35,000,000 for each of fiscal years 2009 through 2013.
                    ``(B) Lobbying expenses.--No portion of any State 
                loan fund established under section 1452 and no portion 
                of any funds made available under this subsection may 
                be used for lobbying expenses.
                    ``(C) Indian tribes.--Of the total amount made 
                available under this section for each fiscal year, 3 
                percent shall be used for technical assistance to 
                public water systems owned or operated by Indian 
                Tribes.''.

SEC. 203. PRESERVATION OF EMPLOYEE LABOR STANDARDS.

    Section 1450 of the Safe Drinking Water Act (42 U.S.C. 300j-9) is 
amended by striking subsection (e) and inserting the following:
    ``(e) Labor Standards.--
            ``(1) In general.--The Administrator shall take such action 
        as the Administrator determines to be necessary to ensure that 
        each laborer and mechanic employed by a contractor or 
        subcontractor of a construction project financed, in whole or 
        in part, by a grant, loan, loan guarantee, refinancing, or any 
        other form of financial assistance provided under this Act 
        (including assistance provided by a State loan fund established 
        under section 1452) is paid wages at a rate of not less than 
        the wages prevailing for the same type of work on similar 
        construction in the immediate locality, as determined by the 
        Secretary of Labor in accordance with subchapter IV of chapter 
        31 of title 40, United States Code.
            ``(2) Authority of secretary of labor.--With respect to the 
        labor standards specified in this subsection, the Secretary of 
        Labor shall have the authority and functions established in 
        Reorganization Plan Numbered 14 of 1950 (5 U.S.C. App.) and 
        section 3145 of title 40, United States Code.''.

SEC. 204. PRECONSTRUCTION WORK.

    Section 1452(a)(2) of the Safe Drinking Water Act (42 U.S.C. 300j-
12(a)(2)) is amended--
            (1) by designating the first, second, third, fourth, and 
        fifth sentences as subparagraphs (A), (B), (D), (E), and (F), 
        respectively;
            (2) in subparagraph (B) (as designated by paragraph (1))--
                    (A) by striking ``(not'' and inserting ``(including 
                expenditures for planning, design, and associated 
                preconstruction activities, including activities 
                relating to the siting of the facility, but not''; and
                    (B) by inserting before the period at the end the 
                following: ``or to replace or rehabilitate aging 
                treatment, storage (including reservoirs), or 
                distribution facilities of public water systems or 
                provide for capital projects to upgrade the security of 
                public water systems''; and
            (3) by inserting after subparagraph (B) (as designated by 
        paragraph (1)) the following:
                    ``(C) Sale of bonds.--Funds may also be used by a 
                public water system to increase security at the public 
                water system (excluding any expenditure for operations 
                and maintenance), or as a source of revenue (restricted 
                solely to interest earnings of the applicable State 
                loan fund) or security for payment of the principal and 
                interest on revenue or general obligation bonds issued 
                by the State to provide matching funds under subsection 
                (e), if the proceeds of the sale of the bonds will be 
                deposited in the State loan fund.''.

SEC. 205. PRIORITY SYSTEM REQUIREMENTS.

    Section 1452(b)(3) of the Safe Drinking Water Act (42 U.S.C. 300j-
12(b)(3)) is amended--
            (1) by redesignating subparagraph (B) as subparagraph (D);
            (2) by striking subparagraph (A) and inserting the 
        following:
                    ``(A) Definition of restructuring.--In this 
                paragraph, the term `restructuring' means changes in 
                operations (including ownership, cooperative 
                partnerships, asset management, consolidation, and 
                alternative water supply).
                    ``(B) Priority system.--An intended use plan shall 
                provide, to the maximum extent practicable, that 
                priority for the use of funds be given to projects 
                that--
                            ``(i) address the most serious risk to 
                        human health;
                            ``(ii) are necessary to ensure compliance 
                        with this title (including requirements for 
                        filtration); and
                            ``(iii) assist systems most in need on a 
                        per-household basis according to State 
                        affordability criteria.
                    ``(C) Weight given to applications.--After 
                determining project priorities under subparagraph (B), 
                an intended use plan shall further provide that the 
                State shall give greater weight to an application for 
                assistance by a community water system if the 
                application includes such information as the State 
                determines to be necessary, including--
                            ``(i) an inventory of assets, including a 
                        description of the condition of the assets;
                            ``(ii) a schedule for replacement of 
                        assets;
                            ``(iii) a financing plan that factors in 
                        all life-cycle costs indicating sources of 
                        revenue from ratepayers, grants, bonds, other 
                        loans, and other sources to meet the costs;
                            ``(iv) a review of options for 
                        restructuring the public water system;
                            ``(v) demonstration of consistency with 
                        State, regional, and municipal watershed plans; 
                        and
                            ``(vi) a water conservation plan consistent 
                        with guidelines developed for those plans by 
                        the Administrator under section 1455(a).''; and
            (3) in subparagraph (D) (as redesignated by paragraph (1)), 
        by striking ``periodically'' and inserting ``at least 
        biennially''.

SEC. 206. AFFORDABILITY.

    Section 1452(d)(3) of the Safe Drinking Water Act (42 U.S.C. 300j-
12(d)(3)) is amended in the first sentence by inserting ``, or portion 
of a service area,'' after ``service area''.

SEC. 207. SAFE DRINKING WATER REVOLVING LOAN FUNDS.

    Section 1452(g) of the Safe Drinking Water Act (42 U.S.C. 300j-
12(g)) is amended--
            (1) paragraph (2)--
                    (A) in the first sentence, by striking ``4'' and 
                inserting ``6''; and
                    (B) by striking ``1419,'' and all that follows 
                through ``1993.'' and inserting ``1419.''; and
            (2) by adding at the end the following:
            ``(5) Transfer of funds.--
                    ``(A) In general.--The Governor of a State may--
                            ``(i)(I) reserve not more than 33 percent 
                        of a capitalization grant made under this 
                        section; and
                            ``(II) add the funds reserved to any funds 
                        provided to the State under section 601 of the 
                        Federal Water Pollution Control Act (33 U.S.C. 
                        1381); and
                            ``(ii)(I) reserve for any fiscal year an 
                        amount that does not exceed the amount that may 
                        be reserved under clause (i)(I) for that year 
                        from capitalization grants made under section 
                        601 of that Act (33 U.S.C. 1381); and
                            ``(II) add the reserved funds to any funds 
                        provided to the State under this section.
                    ``(B) State match.--Funds reserved under this 
                paragraph shall not be considered to be a State match 
                of a capitalization grant required under this section 
                or section 602(b) of the Federal Water Pollution 
                Control Act (33 U.S.C. 1382(b)).''.

SEC. 208. OTHER AUTHORIZED ACTIVITIES.

    Section 1452(k)(2)(D) of the Safe Drinking Water Act (42 U.S.C. 
300j-12(k)(2)(D)) is amended by inserting before the period at the end 
the following: ``(including implementation of source water protection 
plans)''.

SEC. 209. AUTHORIZATION OF APPROPRIATIONS.

    Section 1452 of the Safe Drinking Water Act (42 U.S.C. 300j-12) is 
amended by striking subsection (m) and inserting the following:
    ``(m) Authorization of Appropriations.--
            ``(1) In general.--There are authorized to be appropriated 
        to carry out this section--
                    ``(A) $1,500,000,000 for fiscal year 2008;
                    ``(B) $2,000,000,000 for each of fiscal years 2009 
                and 2010;
                    ``(C) $3,500,000,000 for fiscal year 2011; and
                    ``(D) $6,000,000,000 for fiscal year 2012.
            ``(2) Availability.--Amounts made available under this 
        subsection shall remain available until expended.
            ``(3) Reservation for needs surveys.--Of the amount made 
        available under paragraph (1) to carry out this section for a 
        fiscal year, the Administrator may reserve not more than 
        $1,000,000 per year to pay the costs of conducting needs 
        surveys under subsection (h).''.

SEC. 210. NEGOTIATION OF CONTRACTS.

    Section 1452 of the Safe Drinking Water Act (42 U.S.C. 300j-12) is 
amended by adding at the end the following:
    ``(s) Negotiation of Contracts.--
            ``(1) In general.--A contract to be carried out using funds 
        directly made available by a capitalization grant under this 
        section for program management, construction management, 
        feasibility studies, preliminary engineering, design, 
        engineering, surveying, mapping, or architectural or related 
        services shall be negotiated in the same manner as--
                    ``(A) a contract for architectural and engineering 
                services is negotiated under chapter 11 of title 40, 
                United States Code; or
                    ``(B) an equivalent State qualifications-based 
                requirement (as determined by the Governor of the 
                State).
            ``(2) Exemption for small communities.--Paragraph (1) shall 
        not apply to a contract described in that paragraph for program 
        management, construction management, feasibility studies, 
        preliminary engineering, design, engineering, surveying, 
        mapping, or architectural or related services for a community 
        of 10,000 or fewer individuals.''.

SEC. 211. CRITICAL DRINKING WATER INFRASTRUCTURE PROJECTS.

    (a) Establishment.--Not later than 180 days after the date of 
enactment of this Act, the Administrator of the Environmental 
Protection Agency shall establish a program under which grants are 
provided to eligible entities for use in carrying out projects and 
activities the primary purpose of which is to assist community water 
systems in meeting the requirements of the Safe Drinking Water Act (42 
U.S.C. 300f et seq.).
    (b) Project Selection.--A project that is eligible to be carried 
out using funds provided under this section may include projects that--
            (1) develop alternative water sources;
            (2) provide assistance to small systems; or
            (3) assist a community water system--
                    (A) to comply with a national primary drinking 
                water regulation; or
                    (B) to mitigate groundwater contamination, 
                including saltwater intrusion.
    (c) Eligible Entities.--An entity eligible to receive a grant under 
this section is--
            (1) a community water system as defined in section 1401 of 
        the Safe Drinking Water Act (42 U.S.C. 300f); or
            (2) a system that is located in an area governed by an 
        Indian Tribe (as defined in section 1401 of the Safe Drinking 
        Water Act (42 U.S.C. 300f));
    (d) Priority.--In prioritizing projects for implementation under 
this section, the Administrator shall give priority to community water 
systems that--
            (1) serve a community that, under affordability criteria 
        established by the State under section 1452(d)(3) of the Safe 
        Drinking Water Act (42 U.S.C. 300j-12), is determined by the 
        State to be--
                    (A) a disadvantaged community; or
                    (B) a community that may become a disadvantaged 
                community as a result of carrying out an eligible 
                activity; or
            (2) serve a community with a population of less than 10,000 
        individuals.
    (e) Local Participation.--In prioritizing projects for 
implementation under this section, the Administrator shall consult 
with, and consider the priorities of, affected States, Indian Tribes, 
and local governments.
    (f) Cost-Sharing.--Before carrying out any project under this 
section, the Administrator shall enter into a binding agreement with 1 
or more non-Federal interests that shall require the non-Federal 
interests--
            (1) to pay 45 percent of the total costs of the project, 
        which may include services, materials, supplies, or other in-
        kind contributions;
            (2) to provide any land, easements, rights-of-way, and 
        relocations necessary to carry out the project; and
            (3) to pay 100 percent of any operation, maintenance, 
        repair, replacement, and rehabilitation costs associated with 
        the project.
    (g) Waiver.--The Administrator may waive the requirement to pay the 
non-Federal share of the cost of carrying out an eligible activity 
using funds from a grant provided under this section if the 
Administrator determines that an eligible entity is unable to pay, or 
would experience significant financial hardship if required to pay, the 
non-Federal share.
    (h) Authorization of Appropriations.--There is authorized to be 
appropriated to carry out this section $300,000,000 for each of fiscal 
years 2008 through 2012.

SEC. 212. DISTRICT OF COLUMBIA LEAD SERVICE LINE REPLACEMENT.

    (a) Service Line Replacement.--
            (1) Galvanic effects.--In carrying out lead service line 
        replacement in the District of Columbia, the galvanic effects 
        of replacement of the service lines shall be addressed prior to 
        replacement.
            (2) Authorization of appropriations.--There is authorized 
        to be appropriated to carry out lead service line replacement 
        in the District of Columbia $30,000,000 for each of fiscal 
        years 2008 through 2012.
    (b) Lead Service Line Replacement Assistance Fund.--
            (1) Definition of low-income.--In this subsection, the term 
        ``low-income'' shall be defined by the District of Columbia.
            (2) Grants.--Of the funds provided under subsection (a)(2), 
        not more than $2,000,000 per year may be allocated for water 
        service line replacement grants to provide assistance to low-
        income residents to replace the privately-owned portion of lead 
        service lines.
            (3) Limitation.--An individual grant provided under 
        paragraph (2) shall not exceed $5,000.

                        TITLE III--MISCELLANEOUS

SEC. 301. DEFINITIONS.

    In this title:
            (1) Academy.--The term ``Academy'' means the National 
        Academy of Sciences.
            (2) Administrator.--The term ``Administrator'' means the 
        Administrator of the Environmental Protection Agency.
            (3) Secretary.--The term ``Secretary'' means the Secretary 
        of Agriculture.

SEC. 302. PROGRAM FOR WATER QUALITY ENHANCEMENT AND MANAGEMENT.

    (a) Initial Grant Program.--
            (1) In general.--Not later than 2 years after the date of 
        enactment of this Act, the Administrator shall establish a 
        program to award grants and enter into contracts and 
        cooperative agreements with research institutions, institutions 
        of higher education, and other appropriate entities (including 
        consortia of such institutions and entities), through a 
        competitive process, for research on and development of the use 
        of innovative and alternative technologies to improve water 
        quality or drinking water supply.
            (2) Types of projects.--In carrying out this subsection, 
        the Administrator may select projects relating to such matters 
        as innovative or alternative technologies, approaches, 
        practices, or methods--
                    (A) to increase the effectiveness and efficiency of 
                water and wastewater infrastructure through the use of 
                integrated water resource management;
                    (B) to increase the effectiveness and efficiency of 
                public water systems, including--
                            (i) source water protection;
                            (ii) water use reduction;
                            (iii) water reuse;
                            (iv) water treatment;
                            (v) water distribution and wastewater 
                        collection systems; and
                            (vi) water security;
                    (C) to encourage the use of innovative or 
                alternative technologies or approaches relating to 
                water supply or availability;
                    (D) to increase the effectiveness and efficiency of 
                new and existing treatment works, including--
                            (i) methods of collecting, treating, 
                        dispersing, reusing, reclaiming, and recycling 
                        wastewater;
                            (ii) system design;
                            (iii) nonstructural alternatives;
                            (iv) decentralized approaches;
                            (v) stormwater and wastewater reuse;
                            (vi) water efficiency and conservation; and
                            (vii) wastewater security;
                    (E) to increase the effectiveness and efficiency of 
                municipal separate storm sewer systems and combined 
                sewer systems, including through the use of soil and 
                vegetation or other permeable materials;
                    (F) to promote new water treatment technologies and 
                management approaches, including commercialization and 
                dissemination strategies for adoption of innovative 
                water, wastewater, and stormwater technologies and 
                management approaches or low-impact development 
                technologies in the homebuilding industry; or
                    (G) to maintain a clearinghouse of technologies and 
                management approaches developed under this subsection 
                and subsection (b) at a research consortium or 
                institute.
            (3) Report.--Not later than 2 years after the date on which 
        the program is established under paragraph (1), the 
        Administrator shall publish a report that details the findings 
        of each recipient of a grant under the program with respect to 
        the identification of any potential new technologies or 
        management approaches developed in accordance with this 
        section.
    (b) Nationwide Grant Program.--
            (1) Definition of municipality.--In this subsection, the 
        term ``municipality'' means--
                    (A) a city, town, borough, county, parish, 
                district, association, or other public body created by 
                or pursuant to State law; or
                    (B) an Indian tribe (as defined in section 4 of the 
                Indian Self-Determination and Education Assistance Act 
                (25 U.S.C. 450b)).
            (2) Establishment.--Not later than 90 days after the date 
        of publication of the report under subsection (a)(3), the 
        Administrator shall establish a nationwide demonstration grant 
        program--
                    (A) to promote innovations in technology and 
                alternative approaches to water quality management or 
                water supply developed under subsection (a); and
                    (B) to reduce costs to municipalities incurred in 
                complying with the Federal Water Pollution Control Act 
                (33 U.S.C. 1251 et seq.) and the Safe Drinking Water 
                Act (42 U.S.C. 300f et seq.) through the approaches and 
                technologies developed under subsection (a).
            (3) Scope.--The demonstration grant program shall consist 
        of up to 10 projects each year, to be carried out in 
        municipalities selected by the Administrator under paragraph 
        (4).
            (4) Selection of municipalities.--
                    (A) Application.--A municipality that seeks to 
                participate in the demonstration grant program 
                established under paragraph (2) shall submit to the 
                Administrator a plan that--
                            (i) is developed in coordination with--
                                    (I) the agencies of the State 
                                having jurisdiction over water quality 
                                and water supply matters; and
                                    (II) interested stakeholders, 
                                including institutions of higher 
                                education and related research 
                                institutions;
                            (ii) describes water impacts specific to 
                        urban or rural areas;
                            (iii) includes a strategy under which the 
                        municipality, through participation in the 
                        demonstration grant program, could 
                        effectively--
                                    (I) address water quality or water 
                                supply problems; and
                                    (II) achieve the water quality 
                                goals that--
                                            (aa) could be achieved 
                                        using more traditional methods; 
                                        and
                                            (bb) are required under the 
                                        Federal Water Pollution Control 
                                        Act (33 U.S.C. 1251 et seq.) or 
                                        the Safe Drinking Water Act (42 
                                        U.S.C. 300f et seq.); and
                            (iv) includes a schedule for achieving the 
                        water quality or water supply goals of the 
                        municipality.
                    (B) Categories of projects.--In carrying out the 
                demonstration grant program, the Administrator shall 
                provide grants for projects relating to water supply or 
                water quality matters described in subsection 
                (a)(2)(A).
                    (C) Responsibilities of administrator.--In 
                providing grants for projects under this subsection, 
                the Administrator shall--
                            (i) ensure, to the maximum extent 
                        practicable, that--
                                    (I) the demonstration grant program 
                                under this subsection includes a 
                                variety of projects with respect to--
                                            (aa) geographical 
                                        distribution;
                                            (bb) innovative 
                                        technologies used for the 
                                        projects; and
                                            (cc) nontraditional 
                                        approaches (including low-
                                        impact development 
                                        technologies) used for the 
                                        projects; and
                                    (II) each category of project 
                                described in subparagraph (B) is 
                                adequately represented;
                            (ii) give higher priority to projects 
                        that--
                                    (I) address multiple problems; and
                                    (II) are regionally applicable;
                            (iii) ensure, to the maximum extent 
                        practicable, that at least 1 community having a 
                        population of 10,000 or fewer individuals 
                        receives a grant for each fiscal year; and
                            (iv) ensure that, for each fiscal year, no 
                        municipality receives more than 25 percent of 
                        the total amount of funds made available for 
                        the fiscal year to provide grants under this 
                        subsection.
                    (D) Cost sharing.--
                            (i) In general.--Except as provided in 
                        clause (ii), the non-Federal share of the total 
                        cost of a project funded by a grant under this 
                        subsection shall be not less than 20 percent.
                            (ii) Waiver.--The Administrator may reduce 
                        or eliminate the non-Federal share of the cost 
                        of a project for reasons of affordability.
    (c) Reports.--
            (1) Reports from grant recipients.--A recipient of a grant 
        under this section shall submit to the Administrator, on the 
        date of completion of a project of the recipient and on each of 
        the dates that is 1, 2, and 3 years after that date, a report 
        that describes the effectiveness of the project.
            (2) Reports to congress.--Not later than 2 years after the 
        date of enactment of this Act, and every 2 years thereafter, 
        the Administrator shall submit to the Committee on Environment 
        and Public Works of the Senate and the Committee on 
        Transportation and Infrastructure and the Committee on Energy 
        and Commerce of the House of Representatives a report that 
        describes the status and results of the grant programs under 
        this section.
    (d) Incorporation of Results and Information.--To the maximum 
extent practicable, the Administrator shall incorporate the results of, 
and information obtained from, successful projects under this section 
into programs administered by the Administrator.
    (e) Authorization of Appropriations.--There is authorized to be 
appropriated to carry out this section $20,000,000 for each of fiscal 
years 2008 through 2012.

SEC. 303. AGRICULTURAL POLLUTION CONTROL TECHNOLOGY GRANT PROGRAM.

    (a) Definitions.--In this section:
            (1) Agricultural commodity.--The term ``agricultural 
        commodity'' means--
                    (A) agricultural, horticultural, viticultural, and 
                dairy products;
                    (B) livestock and the products of livestock;
                    (C) the products of poultry and bee raising;
                    (D) the products of forestry; and
                    (E) other commodities raised or produced on 
                agricultural sites, as determined to be appropriate by 
                the Secretary.
            (2) Agricultural project.--The term ``agricultural 
        project'' means an agricultural pollution control technology 
        pilot project that, as determined by the Administrator--
                    (A) is carried out at an agricultural site;
                    (B) achieves demonstrable reductions in water 
                pollution or water use that meet or exceed those 
                mandated by statutory or regulatory requirements; and
                    (C) will not substantially adversely affect any 
                other long-term environmental medium, including air and 
                groundwater resources.
            (3) Agricultural site.--The term ``agricultural site'' 
        means a farming or ranching operation of a producer.
            (4) Producer.--The term ``producer'' means any person who 
        is engaged in the production and sale of an agricultural 
        commodity in the United States and who owns, or shares the 
        ownership and risk of loss of, the agricultural commodity.
            (5) Revolving fund.--The term ``revolving fund'' means an 
        agricultural pollution control technology State revolving fund 
        established by a State using amounts provided under subsection 
        (b)(1).
    (b) Grants for Agricultural State Revolving Funds.--
            (1) In general.--As soon as practicable after the date of 
        enactment of this section, the Administrator shall provide to 
        each eligible State described in paragraph (2) 1 or more 
        capitalization grants, that cumulatively equal no more than 
        $1,000,000 per State, for use in establishing, within an agency 
        of the State having jurisdiction over agriculture or 
        environmental quality, an agricultural pollution control 
        technology State revolving fund.
            (2) Eligible states.--An eligible State referred to in 
        paragraph (1) is a State that agrees, prior to receipt of a 
        capitalization grant under paragraph (1)--
                    (A) to establish, and deposit the funds from the 
                grant in, a revolving fund;
                    (B) to provide, at a minimum, a State share in an 
                amount equal to 20 percent of the capitalization grant;
                    (C) to use amounts in the revolving fund to make 
                loans to producers in accordance with subsection (c); 
                and
                    (D) to return amounts in the revolving fund if no 
                loan applications are granted within 2 years of the 
                receipt of the initial capitalization grant.
    (c) Loans to Producers.--
            (1) Use of funds.--A State that establishes a revolving 
        fund under subsection (b)(2) shall use amounts in the revolving 
        fund to provide loans to producers for use in designing and 
        constructing agricultural projects.
            (2) Maximum amount of loan.--The amount of a loan made to a 
        producer using funds from a revolving fund shall not exceed 
        $250,000, in the aggregate, for all agricultural projects 
        serving an agricultural site of the producer.
            (3) Conditions on loans.--A loan made to a producer using 
        funds from a revolving fund shall--
                    (A) have an interest rate that is not more than the 
                market interest rate, including an interest-free loan; 
                and
                    (B) be repaid to the revolving fund not later than 
                20 years after the date on which the loan is made.
    (d) Requirements for Producers.--
            (1) In general.--A producer that seeks to receive a loan 
        from a revolving fund shall--
                    (A) submit to the State in which the agricultural 
                site of the producer is located an application that--
                            (i) contains such information as the State 
                        may require; and
                            (ii) demonstrates, to the satisfaction of 
                        the State, that each project proposed to be 
                        carried out with funds from the loan is an 
                        agricultural project; and
                    (B) agree to expend all funds from a loan in an 
                expeditious and timely manner, as determined by the 
                State.
            (2) Maximum percentage of agricultural project cost.--
        Subject to subsection (c)(2), a producer that receives a loan 
        from a revolving fund may use funds from the loan to pay up to 
        100 percent of the cost of carrying out an agricultural 
        project.
    (e) Authorization of Appropriations.--There is authorized to be 
appropriated to carry out this section $50,000,000.

SEC. 304. STATE REVOLVING FUND REVIEW PROCESS.

    As soon as practicable after the date of enactment of this Act, the 
Administrator shall--
            (1) consult with States, utilities, nonprofit 
        organizations, and other Federal agencies providing financial 
        assistance to identify ways to expedite and improve the 
        application and review process, for the provision of assistance 
        from--
                    (A) the State water pollution control revolving 
                funds established under title VI of the Federal Water 
                Pollution Control Act (33 U.S.C. 1381 et seq.); and
                    (B) the State drinking water treatment revolving 
                loan funds established under section 1452 of the Safe 
                Drinking Water Act (42 U.S.C. 300j-12);
            (2) in carrying out this section, the Administrator shall 
        consider the needs of small treatment works (as defined by 
        section 222 of the Federal Water Pollution Control Act and 
        small public water systems (as described in section 1433(d) of 
        the Safe Drinking Water Act (42 U.S.C. 300i-2(d));
            (3) take such administrative action as is necessary to 
        expedite and improve the process as the Administrator has 
        authority to take under existing law;
            (4) collect information relating to innovative approaches 
        taken by any State to simplify the application process of the 
        State, and provide the information to each State; and
            (5) submit to Congress a report that, based on the 
        information identified under paragraph (1), contains 
        recommendations for legislation to facilitate further 
        streamlining and improvement of the process.

SEC. 305. COST OF SERVICE STUDY.

    (a) In General.--Not later than 2 years after the date of enactment 
of this Act, the Administrator shall enter an arrangement with the 
Academy under which the Academy shall complete and provide to the 
Administrator the results of a study of the means by which public water 
systems and treatment works selected by the Academy in accordance with 
subsection (c) meet the costs associated with operations, maintenance, 
capital replacement, and regulatory requirements.
    (b) Required Elements.--
            (1) Affordability.--The study shall, at a minimum--
                    (A) determine whether the rates at public water 
                systems and treatment works for communities included in 
                the study were established using a full-cost pricing 
                model;
                    (B) if a full-cost pricing model was not used, 
                identify any incentive rate systems that have been 
                successful in significantly reducing--
                            (i) per capita water demand;
                            (ii) the volume of wastewater flows;
                            (iii) the volume of stormwater runoff; or
                            (iv) the quantity of pollution generated by 
                        stormwater;
                    (C) identify a set of best industry practices that 
                public water systems and treatment works may use in 
                establishing a rate structure that--
                            (i) adequately addresses the true cost of 
                        services provided to consumers by public water 
                        systems and treatment works, including 
                        infrastructure replacement;
                            (ii) encourages water conservation; and
                            (iii) takes into consideration the needs of 
                        disadvantaged individuals and communities, as 
                        identified by the Administrator;
                    (D) identify existing standards for affordability 
                and the manner in which those standards are determined 
                and defined;
                    (E) determine the manner in which affordability 
                varies with respect to communities of different sizes 
                and in different regions; and
                    (F) determine the extent to which affordability 
                affects the decision of a community to increase public 
                water system and treatment works rates (including the 
                decision relating to the percentage by which those 
                rates should be increased).
            (2) Disadvantaged communities.--The study shall, at a 
        minimum--
                    (A) survey a cross-section of States representing 
                different sizes, demographics, and geographical 
                regions;
                    (B) describe, for each State described in 
                subparagraph (A), the definition of ``disadvantaged 
                community'' used in the State in carrying out projects 
                and activities under the Safe Drinking Water Act (42 
                U.S.C. 300f et seq.);
                    (C) review other means of identifying the meaning 
                of the term ``disadvantaged'', as that term applies to 
                communities;
                    (D) determine which factors and characteristics are 
                required for a community to be considered 
                ``disadvantaged''; and
                    (E) evaluate the degree to which factors such as a 
                reduction in the tax base over a period of time, a 
                reduction in population, the loss of an industrial 
                base, and the existence of areas of concentrated 
                poverty are taken into account in determining whether a 
                community is a disadvantaged community.
    (c) Selection of Communities.--The Academy shall select 
communities, the public water system and treatment works rate 
structures of which are to be studied under this section, that include 
a cross-section of communities representing various populations, income 
levels, demographics, and geographical regions.
    (d) Use of Results of Study.--On receipt of the results of the 
study, the Administrator shall--
            (1) submit the study to Congress;
            (2) submit a report that describes the results of the 
        study; and
            (3) make the results available to treatment works and 
        public water systems for use by the publicly owned treatment 
        works and public water systems, on a voluntary basis, in 
        determining whether 1 or more new approaches may be implemented 
        at facilities of the publicly owned treatment works and public 
        water systems.
    (e) Authorization of Appropriations.--There is authorized to be 
appropriated to carry out this section $1,000,000 for each of fiscal 
years 2008 and 2009.

SEC. 306. WATER MANAGEMENT STUDY.

    (a) In General.--As soon as practicable after the date of enactment 
of this Act, the Administrator shall enter into an arrangement with the 
Academy under which the Academy shall conduct a study, during the 26-
month period beginning on the date of enactment of this Act, of 
innovative, effective, and systematic approaches for the management of 
water supply, wastewater, and stormwater in urban areas and surrounding 
communities (including greenfield developments) in the United States 
and other countries.
    (b) Requirements.--In carrying out the study under this section, 
the Academy shall--
            (1) pay particular attention to soft-path or low-impact 
        approaches to the management described in subsection (a); and
            (2) consider the costs of approaches that are analyzed.
    (c) Funding.--The Administrator shall provide to the Academy a 
grant in the amount of $1,000,000 for the period of fiscal years 2009 
through 2011 for use in carrying out the study under this section.

SEC. 307. REDUCTION IN AUTHORIZATION OF APPROPRIATIONS.

    Notwithstanding any other provision of this Act, each amount 
authorized to be appropriated under this Act shall be reduced by 2 
percent.
                                                      Calendar No. 1092

110th CONGRESS

  2d Session

                                S. 3617

                          [Report No. 110-509]

_______________________________________________________________________

                                 A BILL

To amend the Federal Water Pollution Control Act and the Safe Drinking 
Water Act to improve water and wastewater infrastructure in the United 
                                States.

_______________________________________________________________________

           September 26 (legislative day, September 17), 2008

                 Read twice and placed on the calendar