[Congressional Record Volume 167, Number 129 (Thursday, July 22, 2021)]
[Senate]
[Page S5052]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mrs. FEINSTEIN (for herself and Mr. Padilla):
  S. 2430. A bill to amend the Internal Revenue Code of 1986 to expand 
the exclusion for certain conservation subsidies to include subsidies 
for water conservation or efficiency measures and storm water 
management measures; to the Committee on Finance.
  Mrs. FEINSTEIN. Mr. President, I rise to speak in support of the 
``Water Conservation Rebate Tax Parity Act,'' which I introduced today. 
Representative Jared Huffman (D-CA) has introduced companion 
legislation in the House of Representatives.
  Access to water has always been a major issue in California and 
throughout the Western United States. That issue has only become more 
pressing as climate change increases the risk of drought in the West. 
Right now, 87 percent of California is facing ``Extreme Drought'' 
conditions and 33 percent of the state is experiencing ``Exceptional 
Drought'' conditions, the most severe category.
  A growing number of States, including California, have begun offering 
rebates to homeowners to improve the water efficiency of their homes. 
Unfortunately, many homeowners are unaware that they are required to 
pay federal income taxes on these rebates and are surprised to be stuck 
with that bill. Still other homeowners aware of the tax implications 
are disincentivized from making these efficiencies to their homes.
  The ``Water Conservation Rebate Tax Parity Act'' would exempt such 
State and local rebates for water conservation improvements, as well as 
improvements to better handle storm water runoff, from taxable income. 
This would eliminate the unexpected bill homeowners face, increasing 
the incentive to make these improvements, which benefit all of us.
  I note that such State rebates for energy conservation improvements 
are already excluded from taxable income. Thus, my bill would simply 
put water conservation rebates on par with energy conservation rebates 
for tax treatment.
  It is critical that Congress explore many ways to address climate 
change and mitigate the impacts that we are already seeing. Encouraging 
homeowners to make their properties more water-efficient is one way to 
do that.
  I hope my colleagues will join me in support of this bill. Thank you, 
Mr. President, and I yield the floor.
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