[Congressional Record Volume 145, Number 109 (Thursday, July 29, 1999)]
[Senate]
[Pages S9744-S9747]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. WYDEN (for himself and Mr. Craig):
  S. 1457. A bill to amend the Energy Policy Act of 1992 to assess 
opportunities to increase carbon storage on national forests derived 
from the public domain and to facilitate voluntary and accurate 
reporting of forest projects that reduce atmospheric carbon dioxide 
concentrations, and for other purposes; to the Committee on Energy and 
Natural Resources.


      THE FOREST RESOURCES FOR THE ENVIRONMENT AND THE ECONOMY ACT

  Mr. WYDEN. Mr. President, today Senator Craig and I are introducing a 
bill that will help protect the global climate system by improving 
local natural resource management and strengthening the economy in 
rural communities. The Forest Resources for the Environment and the 
Economy Act of 1999 will expand the nation's forested lands and provide 
effective tools for including forests in our national efforts to fight 
global warming. The bill focuses on forests because they are the lungs 
of our planet. Investing in healthy forests is an investment in the 
health of our environment today and the well-being of our planet for 
decades to come.
  In the Pacific Northwest, forests are more than critical 
environmental resources--they are also a cornerstone of our economy. In 
debates about forest policies, there are those who have advocated an 
exclusively environmental pathway, and others who have stressed an 
exclusively economic pathway. This bill is part of what I believe is a 
third pathway through the woods--a path to both stronger rural 
economies and healthier forests. It will reduce the buildup of 
greenhouse gases in the atmosphere and help protect our global climate 
for ourselves, our children and our grandchildren. It will provide 
improved wildlife and fish habitats and protect our waterways. It will 
enhance our national forests by reducing water pollution within their 
watersheds. It will provide jobs in the forestry sector in areas that 
have been hard hit by declining timber harvests. And it will grow 
additional timber resources on underproductive private lands.
  The legislation does all of this through an entirely voluntary, 
incentive-based approach. The bill makes new resources available to 
private landowners through state-operated revolving loan programs that 
provide assistance for tree planting and other forest management 
actions. By quantifying forests' contribution to climate protection, 
the bill puts the free market to work at turning the initial Federal 
investment into a long-term source of non-federal funding for forestry 
projects. And the bill takes an important first step toward reducing 
greenhouse gases on Federal lands by directing the Forest Service to 
report to Congress on options to increase carbon storage in our 
national forests.
  I am deeply concerned about the risks that we are taking with our 
unprecedented experiment with the global climate system. Global climate 
change may jeopardize critical forest and other natural resources that 
are closely tied with Oregon's economy and our citizens' quality of 
life. Water managers in the Northwest may be faced with daunting 
challenges if the predicted climate changes, such as drier, hotter 
summers, complicate protection and management of water supplies. Over 
the last Century, the average temperature in Corvallis, Oregon has 
increased 2.5 degrees Fahrenheit, and average temperatures across 
Oregon could increase by 5 degrees or more over the next century, 
putting the elderly in Oregon especially at risk from more intense heat 
waves. And sea level rise resulting from global warming could eliminate 
the salt marshes along Tillamook and Coos Bay regions. Given these 
potential hazards of global warming, the challenge is to find 
strategies to protect our quality of life that won't cause an economic 
meltdown.
  One of the key strategies for meeting this challenge is something 
this planet has been doing for more than 300 million years--growing 
abundant and healthy forests. Forests are a critical part of our global 
climate system. The total amount of greenhouse gases in our atmosphere 
depends in part on the efficiency of forests and other natural 
``sinks'' that absorb carbon dioxide--the most significant greenhouse 
gas--from the atmosphere. In fact, the world's forests contain 200 
times as much carbon as is emitted to the atmosphere each year from 
burning fossil fuels. The implications are as simple as they are 
scientifically sound--if we grow more trees, bigger trees, and 
healthier trees, we will remove more greenhouse gases from the 
atmosphere and help protect the global climate. According to the 
Pacific Forest Trust, our forest lands in the United States are only 
storing one-quarter of the carbon they can ultimately store. Just 
tapping a portion of this potential by expanding and increasing the 
productivity of the nation's 737 million acres of forests is an 
important part of a win-win strategy to slow global warming.
  And here's the good news--an ounce of investment in our forests is 
worth not only a pound of global warming cure, but also two pounds of 
jobs and three pounds of protection for our waterways and wildlife. The 
bill that I am introducing today will not only protect our global 
environment, but also will

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provide immediate dividends in terms of watershed and habitat 
protection. It will provide jobs today for tree planting and forest 
management, and jobs tomorrow in carbon accounting and monitoring to 
ensure that greenhouse gas reductions are real and verifiable.
  I recognize that global warming is a large problem that cannot be 
solved by forestry actions alone. We need a portfolio of approaches, 
and I continue to strongly support research, development and deployment 
of energy efficient and renewable technologies that reduce greenhouse 
gas emissions. But increasing our nation's forest lands is a key part 
of the solution and something we can do immediately. Forests may not be 
a silver bullet that will solve the entire global warming problem, but 
they are a silver lining to the problem that can provide jobs around 
the country while taking a big step to reverse the buildup of 
greenhouse gas in the atmosphere.
  It is sometimes hard to believe that seven years ago Senators from 
both parties proclaimed their universal support for taking action to 
protect the climate system and reducing the buildup of greenhouse gases 
in the atmosphere. When the 1992 United Nations Framework Convention on 
Climate Change was ratified by the Senate, Senators from both parties 
came to the floor to applaud this commitment to begin reducing 
greenhouse gas emissions. We cannot afford to let the current debates 
about international treaties paralyze this Congress into inaction when 
there are opportunities here at home to protect our environment in ways 
that also provide jobs and economic growth.
  Forests are one of those opportunities. This bill will take the money 
that polluters pay when they are caught violating the Clean Air Act and 
Clean Water Act and use it to expand our forests, protect streams and 
rivers and help remove greenhouse gases from the air. In fiscal year 
1998, $45 million of these environmental penalties were assessed 
against polluters. There are currently no guarantees that these 
penalties, which revert to the General Fund, are used to improve our 
environment. This bill would make this money available as loans to 
small and medium landowners to cover the upfront costs of tree planting 
and other projects that grow healthy, productive forests and provide 
better wildlife habitats.

  This bill is supported by the National Association of State Foresters 
and the Society of American Foresters. It responds to recent 
recommendations of the National Academy of Sciences by providing 
assistance to overcome the capital constraints that prevent non-
industrial, private forest land owners from growing healthy forests. 
Almost 10 million landowners in the United States own 42 percent of 
non-industrial, private forest land in parcels of less than 100 acres. 
Access to these low-interest loans can empower these landowners to 
improve their lands while providing global environmental protection.
  Under the bill, State Foresters will be able to give loans for forest 
projects that remove greenhouse gases from the atmosphere while 
improving habitats and protecting waterways. For example, loans will be 
available for planting trees as buffer zones along salmon streams and 
rivers in areas that are currently being used by livestock or for crop 
production. Loans will be available to turn thin and poorly stocked 
forest lands into healthier and more productive lands that remove 
greater amounts of greenhouse gases from the atmosphere and provide 
additional timber resources on private lands. And loans will be 
available to grow trees for use in bioenergy facilities that can 
provide energy without increasing the greenhouse gases in our 
atmosphere.
  These loans must be repaid with interest--money that will be 
reinvested in additional loans to double and triple the impact of every 
federal dollar over time. Loans may not be provided for reforestation 
activities already required under any state or local laws. And the bill 
ensures that people aren't paid to cut their existing trees in order to 
receive funding for replanting afterwards.
  A critical element of the bill is that it harnesses the power of the 
free market to allow responsible businesses to invest in the nation's 
forests. Across the nation, companies are voluntarily seeking ways to 
reduce greenhouse gases. Some companies are going as far as sending 
money oversees to protect forests in other countries. Forests in Brazil 
are important, but forests in Bend, Oregon, can do just as good a job 
at fighting off global warming. In fact, our Northwest forests are some 
of the best carbon ``sinks'' in the world. This bill provides a way for 
companies to invest in American forests and know with accuracy the 
amount of greenhouse gases that are removed from the atmosphere due to 
their investments. Once businesses recognize that the nation's forests 
are an opportunity for environmental investment, their entrepreneurial 
ingenuity will generate new opportunities for consumers and other 
businesses to tap into this win-win opportunity.
  We know that this approach works because of the leadership of my home 
State of Oregon. The loan program is modeled after the innovative 
Forest Resource Trust, which was established in Oregon in 1993, and is 
just one of the many ways Oregon continues to lead the nation in state 
actions to reduce greenhouse gas emissions. I am pleased to say that 
PacifiCorp announced last month that it is contributing $1.5 million to 
the Forest Resource Trust to support tree planting and reduce 
greenhouse gases in the atmosphere. This leadership by PacifiCorp will 
create forestry jobs in Oregon, protect salmon and fish habitat, create 
new wildlife habitats, and remove greenhouse gases from the atmosphere. 
I am introducing this bill to make sure that we take advantage of these 
opportunities across the country and encourage more businesses to 
invest in the nation's forests.
  In addition to establishing the state revolving loan programs, the 
bill makes important changes to the Energy Policy Act of 1992 to 
strengthen the voluntary accounting and verification of greenhouse gas 
reductions from forestry activities. The bill directs the Secretary of 
Agriculture to develop new guidelines on accurate and cost-effective 
methods to account for and report real and credible greenhouse gas 
reductions. These guidelines will be developed with the input of a new 
advisory board representing industry, foresters, states, and 
environmental groups.
  This bill is about taking advantage of a clear win-win opportunity. 
It's a win for the global environment. It's a win for sustainable 
forestry. It's a win for local water protection. And it's a win for 
rural communities.
  For these reasons, the bill is already supported by timber companies 
and environmental organizations alike. I have already received 
supportive letters from: American Forest and Paper Association, 
American Forests, Environmental Defense Fund, Governor John A. 
Kitzhaber of Oregon, National Association of State Foresters, 
PacifiCorp, Society of American Foresters, The Nature Conservancy, and 
The Pacific Forest Trust.
  I look forward to working with my colleagues to make sure that we 
pursue this common-sense good step toward protecting the environment 
and supporting our forest workers.
  I ask unanimous consent that the Section-by-Section Analysis of the 
Forest Resources for the Environment and the Economy Act be printed in 
the Record.
  There being no objection, the item was ordered to be printed in the 
Record as follows:

 The Forest Resources For The Environment And The Economy Act--Section-
                          by-Section Analysis


                                SUMMARY

       The purpose of the bill is to promote sustainable forestry 
     in the United States by increasing forest carbon 
     sequestration, improving forest health, enhancing wildlife 
     and fish habitats, improving water quality, providing 
     employment and income to rural communities, providing new 
     sources of forest products and increasing use of renewable 
     biomass energy that improves the energy security of the 
     United States. The bill achieves these purposes through four 
     major actions:
       (1) State Revolving Loan Programs. The bill provides 
     assistance to nonindustrial private forest landowners and 
     Indian tribes to grow new forests and increase the 
     productivity of existing forests in order to increase carbon 
     sequestration, protect watersheds and fish habitats and 
     improve wildlife diversity. Assistance to landowners will be 
     provided through State-based loan

[[Page S9746]]

     programs. The Federal share of funding for these State loan 
     programs will come from penalties that are being assessed 
     against violators of the Clean Air Act and the Clean Water 
     Act (civil penalties assessed in FY 1998 totaled $45 
     million).
       (2) Guidelines for Accurate Carbon Accounting for Forests. 
     The bill directs the Secretary of Agriculture to establish 
     scientifically-based guidelines for accurate reporting, 
     monitoring and verification of carbon storage from forest 
     management actions. The bill establishes a multi-stakeholder 
     Carbon and Forestry Advisory Council to assist USDA in 
     developing the guidelines.
       (3) Report on Options to Increase Carbon Storage on Federal 
     Lands. The bill directs the Secretary of Agriculture to 
     report to Congress on forestry options to increase carbon 
     storage in National Forests.
       (4) National Forest Watershed Restoration Cooperative 
     Agreements. The bill allows the Secretary of Agriculture to 
     enter into cooperative agreements with willing State and 
     local governments, Indian tribes, private and nonprofit 
     entities, and landowners for protection, restoration and 
     enhancement of fish and wildlife habitat and other resources 
     on public land, Indian land or private land in a national 
     forest watershed.


                         SECTION 1. SHORT TITLE

       The title of the bill is the ``Forest Resources for the 
     Environment and the Economy Act''.


                    SECTION 2. FINDINGS AND PURPOSES

       This section states the purpose of the bill, which is to 
     promote sustainable forestry in the United States by 
     increasing forest carbon sequestration, improving forest 
     health, enhancing wildlife and fish habitats, improving water 
     quality, providing employment and income to rural 
     communities, providing new sources of forest products and 
     increasing use of renewable biomass energy that improves the 
     energy security of the United States.
       This section also states the findings of the bill, 
     including:
       The Federal Government should increase the forest carbon 
     storage on public land while pursuing existing statutory 
     objectives, but insufficient information exists on the 
     opportunities to increase carbon storage on public land 
     through improvements in forest land management;
       Important environmental benefits to national forests can be 
     achieved through cooperative forest projects that enhance 
     fish and wildlife habitats, water and other resources on 
     public or private land located in national forest watersheds;
       Forest projects also provide economic benefits, including 
     employment and income that contribute to the sustainability 
     of rural communities and future supplies of forest products;
       Monitoring and verification of forest carbon storage 
     provides an important opportunity to create employment in 
     rural communities and substantiate improvements in natural 
     habitats or watersheds due to forestry activities; and
       Sustainable production of biomass energy feedstocks 
     provides a renewable source of energy that can reduce carbon 
     dioxide emissions and improve the energy security of the 
     United States by diversifying energy fuels.


                         SECTION 3. DEFINITIONS

       This section defines terms used in the bill, including the 
     following:
       ``Forestry carbon activity'' is defined as a forest 
     management action that increases long-term carbon storage and 
     has a positive impact on watersheds, fish habitats and 
     wildlife diversity.
       ``Forest carbon reservoir'' is defined as trees, roots, 
     soils or other biomass associated with forest ecosystems or 
     products from the biomass that store carbon.
       ``Forest carbon storage'' is defined as the quantity of 
     carbon sequestered from the atmosphere and stored in forest 
     carbon reservoirs, including forest products.
       ``Forest land'' is defined as land that is, or has been, at 
     least 10 percent stocked by forest trees of any size, 
     including land that had such forest cover and that will be 
     naturally or artificially regenerated, and including a 
     transition zone between a forested and nonforested area that 
     is capable of sustaining forest cover.
       ``Forest management action'' is defined as the practical 
     application of forestry principles to the regeneration, 
     management, utilization and conservation of forests to meet 
     specific goals and objectives, while maintaining the 
     productivity of the forests. ``Forest management action'' 
     includes management of forests for aesthetics, fish, 
     recreation, urban values, water, wilderness, wildlife, wood 
     products and other forest values.
       ``National forest watershed'' is defined as a watershed 
     that contains national forest land, that consequently has 
     unique interest to Federal land managers, and in which all 
     landowners, including the Federal Government, share interest 
     and influence in the management and health of the watershed.
       ``Reforestation'' is defined as the reestablishment of 
     forest cover naturally or artificially, including planned 
     replanting, reseeding and managed natural regeneration.


  section 4. carbon management on federal land; carbon monitoring and 
                        verification guidelines.

       This section directs the Secretary of Agriculture to report 
     to Congress on carbon management on Federal land, and directs 
     the Secretary of Agriculture to develop guidelines for the 
     voluntary reporting, monitoring and verification of carbon 
     storage resulting from forest management actions. This 
     section is accomplished through amendment of Title XVI 
     (``Global Climate Change'') of the Energy Policy Act of 1992.
       (a) Definitions. This subsection amends the Energy Policy 
     Act to add the definitions for ``forest carbon storage,'' 
     ``carbon storage program,'' ``forest carbon reservoir,'' 
     ``forest management action'' and ``sequestration'' that were 
     specified in Section 3.
       (b) Carbon Management on Federal Land. This subsection 
     directs the Secretary of Agriculture to report to Congress 
     within one year on the quantity of carbon contained in the 
     forest carbon reservoir on Western national forests (i.e., 
     ``national forests derived from the public domain''). The 
     report will include an assessment of forest management 
     actions that can increase carbon storage on these national 
     forest lands while providing positive impacts on watersheds 
     and fish and wildlife habitats. Finally, the report will 
     include an assessment of the role of forests in the carbon 
     cycle and the contributions of forestry to the global carbon 
     budget. This subsection is accomplished by amendment to 
     section 1604 of the Energy Policy Act (``Assessment of 
     Alternative Policy Mechanisms for Addressing Greenhouse Gas 
     Emissions'').
       (c) Monitoring and Verification of Carbon Storage. This 
     subsection amends section 1605(b) of the Energy Policy Act 
     (``Voluntary Reporting'') by directing the Secretary of 
     Agriculture to review the existing Federal guidelines on 
     reporting, monitoring, and verification of carbon storage 
     from forest management actions. Within 18 months of enactment 
     and following an opportunity for public comment on the 
     existing guidelines, the Secretary of Agriculture will make 
     recommendations to the Secretary of Energy for amendment of 
     the guidelines.
       Carbon and Forestry Advisory Council: This subsection also 
     directs the Secretary of Agriculture to establish an 18-
     member, multi-stakeholder Carbon and Forestry Advisory 
     Council for the purpose of advising the Department of 
     Agriculture on: the development of the guidelines for 
     accurate voluntary reporting of greenhouse gas sequestration 
     from forest management actions; evaluating the potential 
     implementation of the guidelines; estimating the effect of 
     proposed implementation on atmospheric carbon mitigation; 
     reviewing and updating the guidelines; reporting to Congress 
     on the results of the carbon storage program established in 
     Section 5 of this bill; and assessing the vulnerability of 
     forests to climate change. The Advisory Council includes 
     experts on carbon sequestration representing Federal 
     agencies, the forestry industries, forestry workers and 
     professionals, States, environmental organizations and 
     landowners, as well as independent scientists. Terms of the 
     Advisory Council are staggered to ensure continuity from year 
     to year.
       Criteria: The guidelines developed by the Secretary of 
     Agriculture must be based on: (1) measuring increases in 
     carbon storage in excess of that which would have occurred in 
     the absence of the forest management actions; and (2) 
     comprehensive carbon accounting that reflects net increases 
     in the carbon reservoir and takes into account any carbon 
     emissions resulting from disturbance of carbon reservoirs 
     existing at the start of forest management actions. The 
     guidelines must include options for estimating possible 
     leakage of carbon emissions to other lands, and for 
     quantifying the expected carbon storage over various time 
     periods, taking into account the likely duration of carbon 
     stored in the carbon reservoir.
       Recommended practices: The guidelines must also include 
     recommended practices for monitoring, measurement and 
     verification of carbon storage from forest management actions 
     that, to the maximum extent practicable: are based 
     on statistically sound sampling strategies, are cost-
     effective and allow pooled assessments across lands with 
     multiple owners.
       Guidance to States: The guidelines will include guidance to 
     States for reporting, monitoring and verifying carbon storage 
     achieved under the carbon storage program established in 
     Section 5 of the bill.
       Biomass energy projects: The guidelines will include 
     guidance on calculating net greenhouse gas reductions from 
     biomass energy projects, including net changes in carbon 
     storage resulting from changes in land use, and the effect 
     that using biomass to generate electricity (including 
     cofiring of biomass with fossil fuels) has on the 
     displacement of greenhouse gas emissions from fossil fuels.
       Adoption of recommendations by DOE: The subsection directs 
     the Secretary of Energy,

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     acting through the Administrator of the Energy Information 
     Administration, to revise the existing voluntary reporting 
     guidelines to include the recommendations provided by the 
     Secretary of Agriculture.
       Periodic review of guidelines: At least every 24 months, 
     the Secretary of Agriculture must convene the Advisory 
     Council, review the guidelines and revise the guidelines as 
     necessary, including to ensure consistency with any future 
     Federal laws that provide recognition, credit or reward for 
     reductions of atmospheric greenhouse gas concentrations 
     resulting from forest management actions.
       Monitoring of State revolving loan programs: States 
     participating in the revolving loan program established in 
     Section 5 of the bill must report annually to the Secretary 
     of Agriculture on the results of the program. If a company or 
     non-governmental organization provides funding to the State 
     for specific projects, then the State shall report the carbon 
     achieved by those projects. The Secretary of Agriculture 
     shall review each of these reports, certify reports that are 
     in compliance with the guidelines established by USDA and 
     submit the certified report to the EIA Administrator for 
     inclusion in the 1605(b) voluntary reporting data base.


      SECTION 5. CARBON STORAGE AND WATERSHED RESTORATION PROGRAM

       This section directs the Secretary of Agriculture to 
     establish a program to provide assistance through State 
     revolving loan funds to Indian tribes and owners of 
     nonindustrial private forest land to undertake forestry 
     carbon activities. This section also allows the Secretary of 
     Agriculture to enter into cooperative agreements to protect 
     and enhance fish and wildlife habitat and other resources.
       (a) National Forest Watershed Restoration Cooperative 
     Agreements. This subsection allows the Secretary of 
     Agriculture to enter into cooperative agreements with willing 
     State and local governments, Indian tribes, private and 
     nonprofit entities and landowners for protection, restoration 
     and enhancement of fish and wildlife habitat and other 
     resources on public land, Indian land or private land in a 
     national forest watershed. Projects under such a cooperative 
     agreement are eligible for loans discussed in the next 
     subsection. This subsection extends appropriations 
     authorities that were first provided under Section 334 of the 
     Interior and Related Appropriation Act for FY 1998 (``the 
     Wyden Amendment'').
       (b) State Revolving Loan Funds. This subsection establishes 
     a program to provide assistance through State revolving loan 
     funds to Indian tribes and owners of not more than 5,000 
     acres of nonindustrial private forest land. The assistance is 
     in the form of loans to support forestry carbon activities 
     that increase long-term carbon storage or provide new sources 
     of biomass feedstocks for renewable energy generation, and 
     that have a positive impact on watersheds, fish habitats and 
     wildlife diversity. The program will be administered by the 
     Secretary of Agriculture.
       Guidance: USDA, in collaboration with States, will provide 
     guidance on eligible forestry carbon activities based on the 
     criteria of the bill, recognizing that States should have 
     maximum flexibility to achieve the purposes of the bill in 
     ways most appropriate for each State.
       Prohibitions: Loans will not be issued for activities 
     required under other applicable Federal, State or local laws, 
     nor for costs incurred before entering into a loan agreement 
     with the State.
       Limitation on land considered for funding: States shall not 
     enter into new loan agreements under the bill to fund 
     reforestation of land that has been harvested after enactment 
     if the landowner receives revenues from the harvest 
     sufficient to reforest the land.
       Native species: Funding of reforestation activities shall 
     be provided only for a species that is native to a region, 
     with preference given to species that formerly occupied the 
     land.
       Sustainable forest management plan: States must give 
     priority to projects on land under a sustainable forestry 
     management program or forest stewardship plan, if the 
     projects are consistent with the program or plan.
       Loan amount: Loans can cover up to 100 percent of total 
     project costs, not to exceed $100,000 during any 2-year 
     period.
       Repayment: Loans must be repaid to the State with interest 
     at a rate of at least 5 percent per annum. Loans are to be 
     repaid when the land is harvested, or in accordance with any 
     other repayment schedule determined by the State (for 
     example, a portion of proceeds from each timber sale to be 
     paid over more than one rotation).
       Risk: Landowners do not have to repay loans for timber that 
     is lost to natural catastrophes or that cannot be harvested 
     because of government-imposed restrictions on timber 
     harvesting.
       Lien: The loan terms will include a lien on all timber, 
     forest products and biomass grown on land covered by the 
     loan, with an assurance that the terms of the lien shall 
     transfer with the land on sale, lease or transfer of the 
     land.
       Buyout option: The loan terms will specify financial terms 
     allowing the owner to pay off the loan with interest prior to 
     harvesting the timber specified in the loan.
       Greenhouse gas reductions: A loan agreement must include 
     recognition that, until the loan is paid off or otherwise 
     terminated, all reductions in atmospheric greenhouse gases 
     achieved by projects funded by the loan are attributable to 
     the State that provides funding for the loan, or to any 
     company or NGO that provides funding for the loan via the 
     State program.
       Permanent conservation easements: Loan recipients can 
     cancel the loan by donating to the State or another 
     appropriate entity a permanent conservation easement that 
     permanently protects the land and resources at a level above 
     what is required under applicable Federal, State and local 
     law and furthers the purposes of the bill, including managing 
     the land in a manner that maximizes the forest carbon 
     reservoir of the land.
       Reinvestment of funds: All repayments collected by a State 
     must be reinvested in the program and used by the State to 
     make additional loans.
       Records: The State Forester shall maintain all loan records 
     and make them available to the public.
       Matching funds: A State must match Federal funding by at 
     least 25% beginning in the second year of participating in 
     the program.
       Funding Distribution: Not later than 180 days after 
     enactment, the Secretary will report to Congress on a formula 
     under which Federal funds will be distributed among eligible 
     States. The formula will be based on maximizing the potential 
     for meeting the objectives of the bill, and give appropriate 
     consideration to:
       The acreage of unstocked or underproducing private forest 
     land in each State within national forest watersheds; the 
     potential productivity of such land; the potential long-term 
     carbon storage of such land; the potential to achieve other 
     environmental benefits, such as restoration of native forest 
     communities in riparian areas; the number of owners eligible 
     for loans in each State; and the need for reforestation, 
     timber stand improvement, or other forestry investments 
     consistent with the objectives of the bill.
       The formula will give priority to States that have 
     experienced or are expected to experience significant 
     declines in employment levels in the forestry industries due 
     to declining timber harvests on Federal land.
       Private funding: A revolving loan fund may accept and 
     distribute as loans any funds provided by nongovernmental 
     organizations, businesses or persons in support of the 
     purposes of this Act.
       Bonneville Power Administration (BPA): States served by BPA 
     (Washington, Oregon, Idaho and Montana) may apply for funding 
     from BPA for purposes of funding loans that meet both the 
     objectives of this Act and the fish and wildlife objectives 
     of BPA under current law. Any such application will be 
     subject to the same rules and procedures as any other 
     application.
       Authorization of Appropriations: For the state revolving 
     loan program, this subsection authorizes funding from FY 2001 
     to FY 2010 at amounts equal to civil penalties collected 
     under the Clean Water Act and the Clean Air Act, which 
     currently revert to the Treasury as General Revenues. In 
     fiscal year 1998, $45 million in penalties were assessed. 
     Because penalty assessments can not be accurately predicted 
     in advance, authorization in any given year would be based on 
     the penalties assessed two years preceding.
                                 ______