[Congressional Bills 118th Congress]
[From the U.S. Government Publishing Office]
[H.R. 3637 Introduced in House (IH)]

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118th CONGRESS
  1st Session
                                H. R. 3637

  To direct the Federal Trade Commission to promulgate regulations to 
prohibit an entity from selling, leasing, or offering for sale or lease 
  water rights at an excessive price during certain droughts, and for 
                            other purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                              May 24, 2023

 Mr. Gallego introduced the following bill; which was referred to the 
                    Committee on Energy and Commerce

_______________________________________________________________________

                                 A BILL


 
  To direct the Federal Trade Commission to promulgate regulations to 
prohibit an entity from selling, leasing, or offering for sale or lease 
  water rights at an excessive price during certain droughts, and for 
                            other purposes.

    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 ``Drought-Related Overpricing 
Prevention Act'' or the ``DROP Act''.

SEC. 2. PROHIBITION ON WATER RIGHTS PRICE GOUGING.

    (a) Prohibition.--Not later than 1 year after the date of the 
enactment of this Act, the Commission shall promulgate, under section 
553 of title 5, United States Code, regulations to prohibit an entity 
from selling, leasing, or offering for sale or lease, at an excessive 
price, water rights relating to an area subject to a covered drought.
    (b) Exemptions.--
            (1) In general.--In promulgating regulations under 
        subsection (a), the Commission shall exempt from such 
        regulations the following:
                    (A) An entity with less than $100,000,000 in gross 
                revenues in the United States (including the revenues 
                of any parent entity of such entity) during the 1-year 
                period preceding the date of the relevant sale, lease, 
                or offer.
                    (B) A State government.
                    (C) A local government.
                    (D) A Tribal government.
            (2) Adjustments for inflation.--On an annual basis, the 
        Commission shall adjust the amount specified in paragraph 
        (1)(A) to reflect changes in the Consumer Price Index for All 
        Urban Consumers published by the Bureau of Labor Statistics.
    (c) Excessive Price Determinations.--
            (1) Standards required.--In promulgating regulations under 
        subsection (a), the Commission shall establish standards for 
        determining if a price is excessive.
            (2) Determinations of excessive price.--The standards 
        established under paragraph (1) shall provide for a price to be 
        determined excessive if the Commission finds that the relevant 
        entity is selling, leasing, or offering for sale or lease water 
        rights--
                    (A) using a covered drought as a pretext to 
                increase prices; and
                    (B) at an inappropriately excessive price compared 
                to the average price at which similar water rights were 
                sold, leased, or offered for sale or lease (as the case 
                may be), during the 120-day period preceding such 
                covered drought, by--
                            (i) such relevant entity; or
                            (ii) by all sellers in the relevant market.
            (3) Costs not within control of entity.--The standards 
        established under paragraph (1) may ensure that an entity is 
        not determined to be selling, leasing, or offering for sale or 
        lease water rights at an excessive price if the entity 
        demonstrates, by clear and convincing evidence, that a relevant 
        increase in price is directly attributable to costs that are 
        not within the control of the entity.
    (d) Enforcement by Commission.--
            (1) Unfair or deceptive acts or practices.--A violation of 
        the regulations promulgated under subsection (a) shall be 
        treated as a violation of a regulation under section 
        18(a)(1)(B) of the Federal Trade Commission Act (15 U.S.C. 
        57a(a)(1)(B)) regarding unfair or deceptive acts or practices.
            (2) Powers of commission.--The Commission shall enforce the 
        regulations promulgated under subsection (a) in the same 
        manner, by the same means, and with the same jurisdiction, 
        powers, and duties as though all applicable terms and 
        provisions of the Federal Trade Commission Act (15 U.S.C. 41 et 
        seq.) were incorporated into and made a part of this Act. Any 
        person who violates such regulations shall be subject to the 
        penalties and entitled to the privileges and immunities 
        provided in the Federal Trade Commission Act.
    (e) Definitions.--In this section:
            (1) Commission.--The term ``Commission'' means the Federal 
        Trade Commission.
            (2) Covered drought.--The term ``covered drought'' means 
        any of the following:
                    (A) As determined by the Commission in coordination 
                with the United States Geological Survey, a weather 
                pattern and precipitation deficit that has continued 
                for a period in excess of 6 months.
                    (B) As determined by the Commission in coordination 
                with the Bureau of Reclamation, a Tier 1 or more severe 
                shortage designation with respect to the Colorado 
                River.
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