[Congressional Record Volume 156, Number 34 (Wednesday, March 10, 2010)]
[Senate]
[Pages S1363-S1364]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. MERKLEY (for himself, Mrs. Shaheen, Mr. Johnson, Mr. 
        Lugar, Mr. Bennet, and Mr. Graham):
  S. 3102. A bill to amend the miscellaneous rural development 
provisions of the Farm Security and Rural Investment Act of 2002 to 
authorize the Secretary of Agriculture to make loans to certain 
entities that will use the funds to make loans to consumers to 
implement energy efficiency measures involving structural improvements 
and investments in cost-effective, commercial off-the-shelf 
technologies to reduce home energy use; to the Committee on 
Agriculture, Nutrition, and Forestry.
  Mr. MERKLEY. Mr. President, I rise today to introduce legislation 
that will create jobs and lower energy bills for families and small 
businesses in rural communities by promoting energy-saving home 
renovations.
  I am honored to be joined in this effort by a bipartisan group of 
colleagues that includes Senator Shaheen, Senator Lugar, Senator 
Graham, Senator Johnson, and Senator Bennet of Colorado. Our colleagues 
in the other chamber are introducing companion legislation sponsored by 
Representatives Clyburn, Perriello, Whitfield, and Spratt.
  Our proposed Rural Energy Savings Program would assist rural electric 
co-operatives in offering ``on-bill'' financing to their customers. 
This concept offers two clear and important benefits for consumers, 
including homeowners and owners of commercial or industrial property.
  First, it addresses the challenge of the up-front cost of building 
renovations. Energy efficiency measures almost always make business 
sense in the long term, because they lower the energy bill for the 
family or business. But often, the family or business cannot afford the 
upfront cost of the renovation. By offering low-cost financing, we can 
let families and businesses pay for the cost of the renovation on the 
same time frame that they are getting savings on their energy bill.
  Second, we avoid complicating consumers' lives with another loan 
payment by offering a very simple repayment mechanism: under ``on-
bill'' financing, the consumer repays the loan through a charge on 
their electric bill.
  This bill offers these benefits to Americans across the country by 
using existing structures in place to provide federal assistance to 
rural electric co-operatives. Specifically, the Rural Utilities Service 
will offer loans at zero percent interest to rural co-operatives, who 
can then offer on-bill financing to their customers at no more than 
three percent interest. The difference can be used to pay the local 
nonprofit cooperatives' overhead expenses or to establish a loan loss 
reserve. There are more than 900 electric co-operatives serving 42 
million Americans, so we expect this program to create jobs and help 
lower energy bills in rural communities all over the country.
  For our rural communities to recover and thrive in the wake of the 
economic crisis, we need to put people back to work and lower families' 
expenses, and the Rural Energy Savings Program does both.
  Mr. President, I ask unanimous consent that the text of the bill be 
printed in the Record.
  There being no objection, the text of the bill was ordered to be 
printed in the Record, as follows:

                                S. 3102

       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 ``Rural Energy Savings Program 
     Act''.

     SEC. 2. RURAL ENERGY SAVINGS PROGRAM.

       Title VI of the Farm Security and Rural Investment Act of 
     2002 (7 U.S.C. 7901 note et seq.) is amended by adding the 
     following new section:

     ``SEC. 6407. RURAL ENERGY SAVINGS PROGRAM.

       ``(a) Purpose.--The purpose of this section is to create 
     and save jobs by providing loans to qualified consumers that 
     will use the loan proceeds to implement energy efficiency 
     measures to achieve significant reductions in energy costs, 
     energy consumption, or carbon emissions.
       ``(b) Definitions.--In this section:
       ``(1) Eligible entity.--The term `eligible entity' means--
       ``(A) any public power district, public utility district, 
     or similar entity, or any electric cooperative described in 
     sections 501(c)(12) or 1381(a)(2)(C) of the Internal Revenue 
     Code of 1986, that borrowed and repaid, prepaid, or is paying 
     an electric loan made or guaranteed by the Rural Utilities 
     Service (or any predecessor agency); or
       ``(B) any entity primarily owned or controlled by an entity 
     or entities described in subparagraph (A).
       ``(2) Energy efficiency measures.--The term `energy 
     efficiency measures' means, for or at property served by an 
     eligible entity, structural improvements and investments in 
     cost-effective, commercial off-the-shelf technologies to 
     reduce home energy use.
       ``(3) Qualified consumer.--The term `qualified consumer' 
     means a consumer served by an eligible entity that has the 
     ability to repay a loan made under subsection (d), as 
     determined by an eligible entity.
       ``(4) Qualified entity.--The term `qualified entity' means 
     a non-governmental, not-for-profit organization that the 
     Secretary determines has significant experience, on a 
     national basis, in providing eligible entities with--
       ``(A) energy, environmental, energy efficiency, and 
     information research and technology;
       ``(B) training, education, and consulting;
       ``(C) guidance in energy and operational issues and rural 
     community and economic development;
       ``(D) advice in legal and regulatory matters affecting 
     electric service and the environment; and
       ``(E) other relevant assistance.
       ``(5) Secretary.--The term `Secretary' means the Secretary 
     of Agriculture, acting through the Rural Utilities Service.

[[Page S1364]]

       ``(c) Loans and Grants to Eligible Entities.--
       ``(1) Loans authorized.--Subject to paragraph (2), the 
     Secretary shall make loans to eligible entities that agree to 
     use the loan funds to make loans to qualified consumers as 
     described in subsection (d) for the purpose of implementing 
     energy efficiency measures.
       ``(2) List, plan, and measurement and verification 
     required.--
       ``(A) In general.--As a condition to receiving a loan or 
     grant under this subsection, an eligible entity shall--
       ``(i) establish a list of energy efficiency measures that 
     is expected to decrease energy use or costs of qualified 
     consumers;
       ``(ii) prepare an implementation plan for use of the loan 
     funds; and
       ``(iii) provide for appropriate measurement and 
     verification to ensure the effectiveness of the energy 
     efficiency loans made by the eligible entity and that there 
     is no conflict of interest in the carrying out of this 
     section.
       ``(B) Revision of list of energy efficiency measures.--An 
     eligible entity may update the list required under 
     subparagraph (A)(i) to account for newly available efficiency 
     technologies, subject to the approval of the Secretary.
       ``(C) Existing energy efficiency programs.--An eligible 
     entity that, on or before the date of the enactment of this 
     section or within 60 days after such date, has already 
     established an energy efficiency program for qualified 
     consumers may use an existing list of energy efficiency 
     measures, implementation plan, or measurement and 
     verification system of that program to satisfy the 
     requirements of subparagraph (A) if the Secretary determines 
     the list, plans, or systems are consistent with the purposes 
     of this section.
       ``(3) No interest.--A loan under this subsection shall bear 
     no interest.
       ``(4) Repayment.--A loan under this subsection shall be 
     repaid not more than 10 years from the date on which an 
     advance on the loan is first made to the eligible entity.
       ``(5) Loan fund advances.--The Secretary shall provide 
     eligible entities with a schedule of not more than ten years 
     for advances of loan funds, except that any advance of loan 
     funds to an eligible entity in any single year shall not 
     exceed 50 percent of the approved loan amount.
       ``(6) Jump-start grants.--The Secretary shall make grants 
     available to eligible entities selected to receive a loan 
     under this subsection in order to assist an eligible entity 
     to defray costs, including costs of contractors for equipment 
     and labor, except that no eligible entity may receive a grant 
     amount that is greater than four percent of the loan amount.
       ``(d) Loans to Qualified Consumers.--
       ``(1) Terms of loans.--Loans made by an eligible entity to 
     qualified consumers using loan funds provided by the 
     Secretary under subsection (c)--
       ``(A) may bear interest, not to exceed three percent, to be 
     used for purposes that include establishing a loan loss 
     reserve and to offset personnel and program costs of eligible 
     entities to provide the loans;
       ``(B) shall finance energy efficiency measures for the 
     purpose of decreasing energy usage or costs of the qualified 
     consumer by an amount such that a loan term of not more than 
     ten years will not pose an undue financial burden on the 
     qualified consumer, as determined by the eligible entity;
       ``(C) shall not be used to fund energy efficiency measures 
     made to personal property unless the personal property--
       ``(i) is or becomes attached to real property as a fixture; 
     or
       ``(ii) is a manufactured home;
       ``(D) shall be repaid through charges added to the electric 
     bill of the qualified consumer; and
       ``(E) shall require an energy audit by an eligible entity 
     to determine the impact of proposed energy efficiency 
     measures on the energy costs and consumption of the qualified 
     consumer.
       ``(2) Contractors.--In addition to any other qualified 
     general contractor, eligible entities may serve as general 
     contractors.
       ``(e) Contract for Measurement and Verification, Training, 
     and Technical Assistance.--
       ``(1) Contract required.--Not later than 60 days after the 
     date of enactment of this section, the Secretary shall enter 
     into one or more contracts with a qualified entity for the 
     purposes of--
       ``(A) providing measurement and verification activities, 
     including--
       ``(i) developing and completing a recommended protocol for 
     measurement and verification for the Rural Utilities Service;
       ``(ii) establishing a national measurement and verification 
     committee consisting of representatives of eligible entities 
     to assist the contractor in carrying out this section;
       ``(iii) providing measurement and verification consulting 
     services to eligible entities that receive loans under this 
     section; and
       ``(iv) providing training in measurement and verification; 
     and
       ``(B) developing a program to provide technical assistance 
     and training to the employees of eligible entities to carry 
     out this section.
       ``(2) Use of subcontractors authorized.--A qualified entity 
     that enters into a contract under paragraph (1) may use 
     subcontractors to assist the qualified entity in performing 
     the contract.
       ``(f) Fast Start Demonstration Projects.--
       ``(1) Demonstration projects required.--The Secretary shall 
     enter into agreements with eligible entities (or groups of 
     eligible entities) that have energy efficiency programs 
     described in subsection (c)(2)(C) to establish an energy 
     efficiency loan demonstration projects consistent with the 
     purposes of this section that--
       ``(A) implement approaches to energy audits and investments 
     in energy efficiency measures that yield measurable and 
     predictable savings;
       ``(B) use measurement and verification processes to 
     determine the effectiveness of energy efficiency loans made 
     by eligible entities;
       ``(C) include training for employees of eligible entities, 
     including any contractors of such entities, to implement or 
     oversee the activities described in subparagraphs (A) and 
     (B);
       ``(D) provide for the participation of a majority of 
     eligible entities in a State;
       ``(E) reduce the need for generating capacity;
       ``(F) provide efficiency loans to--
       ``(i) not fewer than 20,000 consumers, in the case of a 
     single eligible entity; or
       ``(ii) not fewer than 80,000 consumers, in the case of a 
     group of eligible entities; and
       ``(G) serve areas where a large percentage of consumers 
     reside--
       ``(i) in manufactured homes; or
       ``(ii) in housing units that are more than 50 years old.
       ``(2) Deadline for implementation.--The agreements required 
     by paragraph (1) shall be entered into not later than 90 days 
     after the date of enactment of this section.
       ``(3) Effect on availability of loans nationally.--Nothing 
     in this subsection shall delay the availability of loans to 
     eligible entities on a national basis beginning not later 
     than 180 days after the date of enactment of this section.
       ``(4) Additional demonstration project authority.--The 
     Secretary may conduct demonstration projects in addition to 
     the project required by paragraph (1). The additional 
     demonstration projects may be carried out without regard to 
     subparagraphs (D), (F), or (G) of paragraph (1).
       ``(g) Additional Authority.--The authority provided in this 
     section is in addition to any authority of the Secretary to 
     offer loans or grants under any other law.
       ``(h) Authorization of Appropriations.--
       ``(1) In general.--There is authorized to be appropriated 
     to the Secretary in fiscal year 2010 $993,000,000 to carry 
     out this section. Notwithstanding paragraph (2), amounts 
     appropriated pursuant to this authorization of appropriations 
     shall remain available until expended.
       ``(2) Amounts for loans, grants, staffing.--Of the amounts 
     appropriated pursuant to the authorization of appropriations 
     in paragraph (1), the Secretary shall make available--
       ``(A) $755,000,000 for the purpose of covering the cost of 
     direct loans to eligible entities under subsection (c) to 
     subsidize gross obligations in the principal amount of not to 
     exceed $4,900,000,000;
       ``(B) $25,000,000 for measurement and verification 
     activities under subsection (e)(1)(A);
       ``(C) $2,000,000 for the contract for training and 
     technical assistance authorized by subsection (e)(1)(B);
       ``(D) $200,000,000 for jump-start grants authorized by 
     subsection (c)(6); and
       ``(E) $1,100,000 for each of fiscal years 2010 through 2019 
     for ten additional employees of the Rural Utilities Service 
     to carry out this section.
       ``(i) Effective Period.--Subject to subsection (h)(1) and 
     except as otherwise provided in this section, the loans, 
     grants, and other expenditures required to be made under this 
     section are authorized to be made during each of fiscal years 
     2010 through 2014.
       ``(j) Regulations.--
       ``(1) In general.--Except as otherwise provided in this 
     subsection, not later than 180 days after the date of 
     enactment of this section, the Secretary shall promulgate 
     such regulations as are necessary to implement this section.
       ``(2) Procedure.--The promulgation of the regulations and 
     administration of this section shall be made without regard 
     to--
       ``(A) chapter 35 of title 44, United States Code (commonly 
     known as the `Paperwork Reduction Act'); and
       ``(B) the Statement of Policy of the Secretary of 
     Agriculture effective July 24, 1971 (36 Fed. Reg. 13804), 
     relating to notices of proposed rulemaking and public 
     participation in rulemaking.
       ``(3) Congressional review of agency rulemaking.--In 
     carrying out this section, the Secretary shall use the 
     authority provided under section 808 of title 5, United 
     States Code.
       ``(4) Interim regulations.--Notwithstanding paragraphs (1) 
     and (2), to the extent regulations are necessary to carry out 
     any provision of this section, the Secretary shall implement 
     such regulations through the promulgation of an interim 
     rule.''.
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