,i #aaeth ,,congress #ast ,session ,h4 ,r4 #dcd ,,in ,,the ,,house ,,of ,,representatives ,january #aa1 #bjag,mr4 ,denham 7for himself1 ,mr4 ,la,malfa1 ,mr4 ,newhouse1 ,mr4 ,calvert1 ,mr4 ,costa1 and ,mr4 ,garamendi7 introduced the following bill2 which was referred to the ,committee on ,natural ,resources ,a ,,bill ,to authorize a pilot project for an innovative water project financing program1 and for other purposes4 #a4 ,short title2 table of contents 7a7 ,short title ,this ,act may be cited as the ,new ,water ,available ,to ,every ,reclamation ,state ,act or the ,new ,,water ,act4 7b7 ,table of contents ,the table of contents of this ,act is as follows3 ,sec4 #a4 ,short title2 table of contents4 ,sec4 #b4 ,purposes4 ,sec4 #c4 ,authority to provide assistance4 ,sec4 #d4 ,applications4 ,sec4 #e4 ,eligibility for assistance4 ,sec4 #f4 ,selection criteria4 ,sec4 #g4 ,federal requirements4 ,sec4 #h4 ,secured loans4 ,sec4 #i4 ,program administration4 ,sec4 #aj4 ,state1 tribal1 and local permits4 ,sec4 #aa4 ,regulations4 ,sec4 #ab4 ,funding4 ,sec4 #ac4 ,report to ,congress on pilot project implementation4 ,sec4 #ad4 ,definitions4 #b4 ,purposes ,the purposes of this ,act are-- 7#a7 to promote increased development of critical water resources infrastructure by establishing additional opportunities for financing water resources projects2 7#b7 to attract new investment capital to infrastructure projects that are capable of generating revenue streams through user fees or other dedicated funding sources2 and 7#c7 to leverage private investment in water resources infrastructure4 #c4 ,authority to provide assistance 7a7 ,in general ,for #ae years after the date of the enactment of this ,act1 the ,secretary may provide financial assistance under this ,act to carry eligible projects within-- 7#a7 any ,reclamation ,state2 7#b7 any other ,state in which the ,bureau of ,reclamation is authorized to provide project assistance2 and 7#c7 the ,states of ,alaska and ,hawaii4 7b7 ,selection ,in selecting projects to receive financial assistance under subsection 7a71 the ,secretary shall ensure diversity with respect to-- 7#a7 project types2 and 7#b7 geographical locations4 #d4 ,applications ,to be eligible to receive assistance under this ,act1 an eligible entity shall submit to the ,secretary an application at such time1 in such manner1 and containing such information as the ,secretary may require4 #e4 ,eligibility for assistance 7a7 ,eligible projects ,the following projects may be carried out using assistance made available under this ,act3 7#a7 ,any non-,federal water infrastructure project that-- 7,a7 the ,secretary determines1 through the completion of an appraisal investigation and feasibility study1 would contribute to a safe1 adequate water supply for domestic1 agricultural1 environmental1 or municipal and industrial use2 and 7,b7 is otherwise eligible for assistance under this ,act4 7#b7 ,a project for enhanced energy efficiency in the operation of a water system4 7#c7 ,a project for accelerated repair and replacement of an aging water distribution facility4 7#d7 ,a brackish or sea water desalination project4 7#e7 ,acquisition of real property or an interest in real property for water storage1 reclaimed or recycled water1 or wastewater1 if the acquisition is integral to a project described in paragraphs 7#a7 through 7#e74 7#f7 ,a combination of projects1 each of which is eligible under paragraphs 7#a7 through 7#f71 for which an eligible entity or group of eligible entities submits a single application4 7b7 ,eligible costs ,assistance made available under this ,act 7as paid by or for the account of an obligor7 may be used to cover the following costs with respect to an eligible project3 7#a7 ,development-phase activities1 including planning1 feasibility analysis1 revenue forecasting1 environmental review1 permitting1 preliminary engineering and design work1 and other preconstruction activities4 7#b7 ,construction1 reconstruction1 rehabilitation1 and replacement activities4 7#c7 ,acquisition of real property 7including water rights1 land relating to the project1 and improvements to land71 environmental mitigation1 construction contingencies1 and acquisition of equipment4 7#d7 ,capitalized interest necessary to meet market requirements1 reasonably required reserve funds1 capital issuance expenses1 and other carrying costs during construction4 7#e7 ,refinancing interim construction funding1 existing long-term project obligations1 or a secured loan or loan guarantee made under this ,act4 7c7 ,additional eligibility requirements ,to be eligible to receive financial assistance under this ,act1 a project shall meet the following criteria1 as determined by the ,secretary3 7#a7 ,creditworthiness 7,a7 ,in general ,subject to subparagraph 7,b71 the project shall be creditworthy1 as determined by the ,secretary1 who shall ensure that any financing for the project has appropriate security features1 such as a rate covenant1 if applicable1 and adequate coverage requirements1 to ensure repayment4 7,b7 ,opinion letter 7i7 ,preliminary rating opinion letter ,the ,secretary shall require each applicant to provide a preliminary rating opinion letter from at least one rating agency indicating that the senior obligations of the project 7which may be the ,federal credit instrument7 have the potential to achieve an investment-grade rating4 7ii7 ,final rating opinion letters ,the ,secretary or the ,administrator1 as applicable1 shall require each project applicant to provide1 prior to final acceptance and financing of the project1 final rating opinion letters from at least one rating agency indicating that the senior obligations of the project have an investment-grade rating4 7#b7 ,eligible project costs ,the eligible project costs of a project shall be reasonably anticipated to be not less than #bj1jjj1jjj4 7#c7 ,dedicated revenue sources ,the ,federal credit instrument for the project shall be repayable1 in whole or in part1 from dedicated revenue sources that also secure or fund the project obligations4 7#d7 ,public sponsorship of private entities ,in the case of a project carried out by an entity that is not a ,state or local government or an agency or instrumentality of a ,state or local government1 the project shall be publicly sponsored as demonstrated by certification of the same by an agency of the relevant ,state1 inclusion in the relevant ,state's official improvement plan or by other means acceptable to the ,secretary4 7d7 ,receipt of other ,federal funding ,receipt of a ,federal grant or contract or other ,federal funding to support an eligible project shall not preclude the project from being eligible for assistance under this ,act4 #f4 ,selection criteria 7a7 ,establishment ,the ,secretary shall establish criteria for the selection of one or more projects that meet the eligibility requirements section #e in accordance with paragraph 7#b74 ,the ,secretary may enter into a master credit agreement for a projects secured by a common security pledge on terms acceptable to the ,secretary4 7b7 ,criteria ,the selection criteria shall include the following3 7#a7 ,the extent to which the project is nationally or regionally significant4 7#b7 ,the extent to which assistance under this section would foster innovative public-private partnerships and attract private debt or equity investment4 7#c7 ,the likelihood that assistance under this section would enable the project to proceed at an earlier date than the project would otherwise be able to proceed4 7#d7 ,the extent to which the project uses new or innovative approaches4 7#e7 ,the amount of budget authority required to fund the ,federal credit instrument made available under this ,act4 7#f7 ,the extent to which the project helps maintain or protect the environment4 #g4 ,federal requirements 7a7 ,effect of section ,nothing in this section supersedes the applicability of other requirements of ,federal law 7including regulations74 7b7 ,,nepa ,a ,federal action carried out regarding a loan or loan guarantee provided under this ,act shall not be considered to be a ,federal action for purposes of the ,national ,environmental ,policy ,act of #aifi 7#db ,u4,s4,c4 #dcba et seq474 #h4 ,secured loans 7a7 ,agreements 7#a7 ,in general ,subject to paragraphs 7#b7 through 7#d71 the ,secretary may enter into agreements with one or more obligors to make secured loans1 the proceeds of which shall be used-- 7,a7 to finance eligible project costs of any project selected under section #f2 7,b7 to refinance interim construction financing of eligible project costs of any project selected under section #f2 or 7,c7 to refinance long-term project obligations or ,federal credit instruments1 if that refinancing provides additional funding capacity for the completion1 enhancement1 or expansion of any project that is selected under section #f4 7#b7 ,limitation on refinancing of interim construction financing ,a secured loan under paragraph 7#a7 shall not be used to refinance interim construction financing under paragraph 7#a77;,b7-- 7,a7 if the maturity of such interim construction financing is later than #a year after the substantial completion of the project2 and 7,b7 later than #a year after the date of substantial completion of the applicable project4 7#c7 ,risk assessment ,before entering into an agreement under this subsection for a secured loan1 the ,secretary1 in consultation with the ,director of the ,office of ,management and ,budget shall determine an appropriate capital reserve subsidy amount for the secured loan1 taking into account each such preliminary rating opinion letter4 7#d7 ,investment-grade rating requirement ,the execution of a secured loan under this section shall be contingent on receipt by the senior obligations of the project secured by the same revenue pledge of an investment-grade rating from at least one rating agency4 7b7 ,terms and limitations 7#a7 ,in general ,a secured loan provided for a project under this section shall be subject to such terms and conditions1 and contain such covenants1 representations1 warranties1 and requirements 7including requirements for audits71 as the ,secretary determines to be appropriate4 7#b7 ,maximum amount ,the amount of a secured loan under this section shall not exceed the lesser of-- 7,a7 an amount equal to #di percent of the reasonably anticipated eligible project costs2 and 7,b7 if the secured loan does not receive an investment-grade rating1 the amount of the senior project obligations of the project4 7#c7 ,payment ,a secured loan under this section-- 7,a7 shall be payable1 in whole or in part1 from ,state or local taxes1 user fees1 or other dedicated revenue sources that also secure the senior project obligations of the relevant project2 7,b7 shall include a rate covenant1 coverage requirement1 or similar security feature supporting the project obligations2 and 7,c7 may have a lien on revenues described in subparagraph 7,a71 subject to any lien securing project obligations4 7#d7 ,interest rate ,the interest rate on a secured loan under this section shall not be less than a rate equal to the yield on ,united ,states ,treasury securities of a similar maturity to the maturity of the secured loan on the date of execution of the loan agreement4 7#e7 ,maturity date ,the final maturity date of a secured loan under this section shall be not later than the earlier of-- 7,a7 #ce years after the date of substantial completion of the relevant project2 and 7,b7 the final day of the useful life of the capital asset being financed4 7#f7 ,nonsubordination ,a secured loan under this section shall not be subordinated to the claims of any holder of project obligations in the event of bankruptcy1 insolvency1 or liquidation of the obligor4 7#g7 ,fees ,the ,secretary may establish fees1 as provided for in section #aj7;b71 at a level sufficient to cover all or a portion of the costs to the ,federal ,government of making a secured loan under this section4 7#h7 ,non-federal share ,the proceeds of a secured loan under this section may be used to pay any non-,federal share of project costs required if the loan is repayable from non-,federal funds4 7#i7 ,maximum federal involvement ,for each project for which assistance is provided under this ,act1 the total amount of ,federal assistance from all sources1 including the assistance provided under this ,act1 shall not exceed #hj percent of the total project cost4 7c7 ,repayment 7#a7 ,schedule ,the ,secretary shall establish a repayment schedule for each secured loan provided under this section1 based on the projected cash flow from project revenues1 other repayment sources1 and the useful life of the project4 7#b7 ,commencement ,scheduled loan repayment of principal or interest on a secured loan under this section shall commence not later than #e years after the date of substantial completion of the project4 7#c7 ,deferred payments 7,a7 ,authorization ,if1 at any time after the date of substantial completion of a project for which a secured loan is provided under this section1 the project is unable to generate sufficient revenues to pay the scheduled loan repayments of principal and interest on the secured loan1 the ,secretary may allow the obligor1 subject to subparagraph 7,c71 to add unpaid principal and interest to the outstanding balance of the secured loan4 7,b7 ,interest ,any payment deferred under subparagraph 7,a7 shall-- 7i7 continue to accrue interest in accordance with subsection 7b77#d7 until fully repaid2 and 7ii7 be scheduled to be amortized over the remaining term of the secured loan4 7,c7 ,criteria 7i7 ,in general ,any payment deferral under subparagraph 7,a7 shall be contingent on the project meeting such criteria as the ,secretary may establish4 7ii7 ,repayment standards ,the criteria established under clause 7i7 shall include standards for reasonable assurance of repayment4 7#d7 ,prepayment 7,a7 ,use of excess revenues ,any excess revenues that remain after satisfying scheduled debt service requirements on the project obligations and secured loan and all deposit requirements under the terms of any trust agreement1 bond resolution1 or similar agreement securing project obligations may be applied annually to prepay a secured loan under this section without penalty4 7,b7 ,use of proceeds of refinancing ,a secured loan under this section may be prepaid at any time without penalty from the proceeds of refinancing from non-,federal funding sources4 7d7 ,sale of secured loans 7#a7 ,in general ,subject to paragraph 7#b71 as soon as practicable after the date of substantial completion of a project and after providing a notice to the obligor1 the ,secretary may sell to another entity or reoffer into the capital markets a secured loan for a project under this section1 if the ,secretary determines that the sale or reoffering can be made on favorable terms4 7#b7 ,consent of obligor ,in making a sale or reoffering under paragraph 7#a71 the ,secretary may not change the original terms and conditions of the secured loan without the written consent of the obligor4 7e7 ,loan guarantees 7#a7 ,in general ,the ,secretary may provide a loan guarantee to a lender in lieu of making a secured loan under this section1 if the ,secretary determines that the budgetary cost of the loan guarantee is substantially the same as that of a secured loan4 7#b7 ,terms ,the terms of a loan guarantee provided under this subsection shall be consistent with the terms required under this section for a secured loan1 except that the rate on the guaranteed loan and any prepayment features shall be negotiated between the obligor and the lender1 with the consent of the ,secretary4 #i4 ,program administration 7a7 ,requirement ,the ,secretary shall establish a uniform system to service the ,federal credit instruments made available under this ,act4 7b7 ,servicer 7#a7 ,in general ,the ,secretary may appoint a financial entity to assist the ,secretary in servicing the ,federal credit instruments provided under this ,act4 7#b7 ,duties2 fee ,a servicer appointed under paragraph 7#a7 shall-- 7,a7 act as the agent for the ,secretary2 and 7,b7 receive a servicing fee1 subject to approval by the ,secretary4 7c7 ,assistance from experts ,the ,secretary may retain the services1 including counsel1 of any organization or entity with expertise in the field of municipal and project finance to assist in the underwriting and servicing of ,federal credit instruments provided under this ,act4 #aj4 ,state1 tribal1 and local permits ,the provision of financial assistance for a project under this ,act shall not-- 7#a7 relieve any recipient of the assistance of any obligation to obtain any required ,state1 local1 or tribal permit or approval with respect to the project2 7#b7 limit the right of any unit of ,state1 local1 or tribal government to approve or regulate any rate of return on private equity invested in the project2 or 7#c7 otherwise supersede any ,state1 local1 or tribal law 7including any regulation7 applicable to the construction or operation of the project4 #aa4 ,regulations ,the ,secretary may promulgate such regulations as the ,secretary determines to be appropriate to carry out this ,act4 #ab4 ,funding 7a7 ,in general ,there is authorized to be appropriated to each of the ,secretary and the ,administrator to carry out this ,act1 to remain available until expended-- 7#a7 #bj1jjj1jjj for fiscal year #bjah2 7#b7 #be1jjj1jjj for fiscal year #bjai2 7#c7 #ce1jjj1jjj for fiscal year #bjbj2 7#d7 #de1jjj1jjj for fiscal year #bjba2 and 7#e7 #ej1jjj1jjj for fiscal year #bjbb4 7b7 ,administrative costs ,of the funds made available to carry out this ,act1 the ,secretary may use for the administration of this ,act not more than #b1bjj1jjj for each of fiscal years #bjah through #bjbb4 #ac4 ,report to ,congress on pilot project implementation ,not later than #b years after the date of enactment of this ,act1 and every #b years thereafter1 the ,secretary shall submit to the ,committee on ,energy and ,natural ,resources of the ,senate and the ,committee on ,natural ,resources of the ,house of ,representatives a report summarizing the financial performance of the projects that are receiving1 or have received1 assistance under this ,act1 including an assessment of whether the objectives of this ,act are being met4 #ad4 ,definitions ,in this ,act3 7#a7 ,eligible entity ,the term eligible entity means-- 7,a7 a corporation2 7,b7 a partnership2 7,c7 a joint venture2 7,d7 a trust2 7,e7 a ,state1 local or non-,federal governmental entity1 agency1 or instrumentality2 and 7,f7 a conservancy district1 irrigation district1 canal company1 mutual water company1 water users' association1 ,indian tribe1 agency created by interstate compact1 or any other entity that has the capacity to contract with the ,united ,states under ,federal reclamation law4 7#b7 ,eligible project costs ,the term eligible project costs means the total cost of activities deemed eligible for assistance in section #f7;b7 of this ,act4 7#c7 ,federal credit instrument ,the term ,federal credit instrument means a secured loan or loan guarantee authorized to be made available under this ,act with respect to a project4 7#d7 ,investment-grade rating ,the term investment-grade rating means a rating of ,,bbb minus1 ,baa#c1 bbb minus1 ,,bbb 7low71 or higher as assigned by a rating agency to project obligations4 7#e7 ,lender 7,a7 ,in general ,the term lender means any non-,federal qualified institutional buyer 7as defined in section #bcj4add;,a7a7 of title #ag1 ,code of ,federal ,regulations 7or a successor regulation7 7commonly known as ,rule #add;,a7a7 of the ,securities and ,exchange ,commission and issued under the ,securities ,act of #aicc 7#ae ,u4,s4,c4 #gg;a et seq47774 7,b7 ,inclusions ,the term lender includes-- 7i7 a qualified retirement plan 7as defined in section #digd of the ,internal ,revenue ,code of #aihf7 that is a qualified institutional buyer2 and 7ii7 a governmental plan 7as defined in section #dad of the ,internal ,revenue ,code of #aihf7 that is a qualified institutional buyer4 7#f7 ,loan guarantee ,the term loan guarantee means any guarantee or other pledge by the ,secretary to pay all or part of the principal of1 and interest on1 a loan or other debt obligation issued by an obligor and funded by a lender4 7#g7 ,master credit agreement ,the term master credit agreement means an ,agreement to extend credit assistance for one or more projects secured by a common security pledge 7which shall receive an investment-grade rating from a rating agency71 or for a single project that would-- 7,a7 make contingent commitments of one or more secured loans or other ,federal credit instruments at future dates1 subject to the availability of future funds being made available to carry out this ,act2 7,b7 establish the maximum amounts and general terms and conditions of the secured loans or other ,federal credit instruments2 7,c7 identify the one or more dedicated non-,federal revenue sources that will secure the repayment of the secured loans or secured ,federal credit instruments2 7,d7 provide for the obligation of funds for the secured loans or secured ,federal credit instruments after all requirements have been met for the projects subject to the master credit agreement1 including-- 7i7 completion of an environmental impact statement or similar analysis required under the ,national ,environmental ,policy ,act of #aifi 7#db ,u4,s4,c4 #dcba et seq472 7ii7 compliance with such other requirements as are specified in this ,act2 and 7iii7 the availability of funds to carry out this ,act2 and 7,e7 require that contingent commitments result in a financial close and obligation of credit assistance not later than #c years after the date of entry into the master credit agreement1 or release of the commitment1 unless otherwise extended by the ,secretary4 7#h7 ,obligor ,the term obligor means an eligible entity that is primarily liable for payment of the principal of1 or interest on1 a ,federal credit instrument4 7#i7 ,project obligation 7,a7 ,in general ,the term project obligation means any note1 bond1 debenture1 or other debt obligation issued by an obligor in connection with the financing of a project4 7,b7 ,exclusion ,the term project obligation does not include a ,federal credit instrument4 7#aj7 ,rating agency ,the term rating agency means a credit rating agency registered with the ,securities and ,exchange ,commission as a nationally recognized statistical rating organization 7as defined in section #c7;a7 of the ,securities ,exchange ,act of #aicd 7#ae ,u4,s4,c4 #gh;c7a7774 7#aa7 ,reclamation state ,the term ,reclamation ,state means any of the following ,states3 7,a7 ,arizona2 7,b7 ,california2 7,c7 ,colorado2 7,d7 ,idaho2 7,e7 ,kansas2 7,f7 ,montana2 7,g7 ,nebraska2 7,h7 ,nevada2 7,i7 ,new ,mexico2 7,j7 ,north ,dakota2 7,k7 ,oklahoma2 7,l7 ,oregon2 7,m7 ,south ,dakota2 7,n7 ,texas2 7,o7 ,utah2 7,p7 ,washington2 and 7,q7 ,wyoming4 7#ab7 ,secretary ,the term ,secretary means the ,secretary of the ,interior4 7#ac7 ,secured loan ,the term secured loan means a direct loan or other debt obligation issued by an obligor and funded by the ,secretary in connection with the financing of a project under this ,act4 7#ad7 ,subsidy amount ,the term subsidy amount means the amount of budget authority sufficient to cover the estimated long-term cost to the ,federal ,government of a ,federal credit instrument1 as calculated on a net present value basis1 excluding administrative costs and any incidental effects on governmental receipts or outlays in accordance with the ,federal ,credit ,reform ,act of #aiij 7#b ,u4,s4,c4 #ffa et seq474 7#ae7 ,substantial completion ,the term substantial completion1 with respect to a project1 means-- 7,a7 the initial operation of a project 7after completion of any startup tests71 resulting in producing1 storage1 delivery1 receiving1 or conserving water2 or 7,b7 a comparable event1 as determined by the ,secretary and specified in the master credit agreement4