House Report 106-597 - LONG ISLAND SOUND RESTORATION ACT

[House Report 106-597]
[From the U.S. Government Publishing Office]

106th Congress Report
HOUSE OF REPRESENTATIVES
2d Session 106-597

======================================================================

LONG ISLAND SOUND RESTORATION ACT
_______

May 2, 2000.--Committed to the Committee of the Whole House on the
State of the Union and ordered to be printed

_______

Mr. Shuster, from the Committee on Transportation and Infrastructure,
submitted the following

R E P O R T

[To accompany H.R. 3313]

[Including cost estimate of the Congressional Budget Office]

The Committee on Transportation and Infrastructure, to whom
was referred the bill (H.R. 3313) to amend section 119 of the
Federal Water Pollution Control Act to reauthorize the program
for Long Island Sound, and for other purposes, having
considered the same, report favorably thereon with an amendment
and recommend that the bill as amended do pass.
The amendment is as follows:
Strike out all after the enacting clause and insert in lieu
thereof the following:

SECTION 1. SHORT TITLE.

This Act may be cited as the ``Long Island Sound Restoration Act''.

SEC. 2. NITROGEN CREDIT TRADING SYSTEM AND OTHER MEASURES.

Section 119(c)(1) of the Federal Water Pollution Control Act (33
U.S.C. 1269(c)(1)) is amended by inserting ``, including efforts to
establish, within the process for granting watershed general permits, a
system for trading nitrogen credits and any other measures that are
cost-effective and consistent with the goals of the Plan'' before the
semicolon at the end.

SEC. 3. ASSISTANCE FOR DISTRESSED COMMUNITIES.

Section 119 of the Federal Water Pollution Control Act (33 U.S.C.
1269) is amended--
(1) by redesignating subsection (e) as subsection (f); and
(2) by inserting after subsection (d) the following:
``(e) Assistance to Distressed Communities.--
``(1) Eligible communities.--
``(A) States to determine criteria.--For the purposes
of this subsection, a distressed community is any
community that meets affordability criteria established
by the State in which the community is located, if such
criteria are developed after public review and comment.
``(B) Consideration of impact on water and sewer
rates.--In determining if a community is a distressed
community for the purposes of this subsection, the
State shall consider the extent to which the rate of
growth of a community's tax base has been historically
slow such that implementing the plan described in
subsection (c)(1) would result in a significant
increase in any water or sewer rate charged by the
community's publicly-owned wastewater treatment
facility.
``(C) Information to assist states.--The
Administrator may publish information to assist States
in establishing affordability criteria under
subparagraph (A).
``(2) Revolving loan funds.--
``(A) Loan subsidies.--Subject to subparagraph (B),
any State making a loan to a distressed community from
a revolving fund under title VI for the purpose of
assisting the implementation of the plan described in
subsection (c)(1) may provide additional subsidization
(including forgiveness of principal).
``(B) Total amount of subsidies.--For each fiscal
year, the total amount of loan subsidies made by a
State under subparagraph (A) may not exceed 30 percent
of the amount of the capitalization grant received by
the State for the year.
``(3) Priority.--In making assistance available under this
section for the upgrading of wastewater treatment facilities, a
State may give priority to a distressed community.''.

SEC. 4. REAUTHORIZATION OF APPROPRIATIONS.

Section 119(f) of the Federal Water Pollution Control Act (as
redesignated by section 3 of this Act) is amended--
(1) in paragraph (1), by striking ``1991 through 2001'' and
inserting ``2000 through 2003''; and
(2) in paragraph (2), by striking ``not to exceed $3,000,000
for each of the fiscal years 1991 through 2001'' and inserting
``not to exceed $80,000,000 for each of fiscal years 2000
through 2003''.

Purpose and Summary

The purpose of H.R. 3313 is to reauthorize and improve the
Long Island Sound program under the Clean Water Act.

Background and Need for Legislation

Long Island Sound is approximately 110 miles long and 21
miles across at its widest point. More than 8 million people
live within the Long Island Sound watershed, which is bordered
by the states of New York and Connecticut. Studies estimate the
Sound generates more than $5 billion a year for the regional
economy from boating, swimming, and commercial and sport
fishing, among other activities. The Long Island Sound, like
many estuaries across the U.S., supports multiple uses and
demands, and provides habitat for a multitude of fish and
wildlife species. Increasing population growth and development
have led to water quality problems arising from increased
nonpoint source pollution from stormwater and agricultural
runoff, wastewater discharges with high nitrogen levels,
industrial pollution, and commercial and recreational waste.
An estimated $1 billion will be needed over the next 20
years to address the environmental and public health problems
in the Sound. Much of this cost is associated with sewage
treatment plant upgrades to control nitrogen discharges into
the Sound. To meet nitrogen reduction goals in a cost-effective
manner, Connecticut has been working cooperatively with EPA on
the development of a nitrogen credit trading program.
Long Island Sound is one of the estuaries in EPA's National
Estuary Program (NEP), established under section 320 of the
Clean Water Act. EPA approved the Comprehensive Conservation
and Management Plan (CCMP) for Long Island Sound in September
1994. The CCMP resulted from the Long Island Sound Study, which
was a cooperative effort involving researchers, federal, state,
and local regulators, user groups, and other stakeholders to
research and monitor Sound conditions, identify priority
problems, and develop strategies to address them. NEP funding
for the Long Island Sound has been approximately $300,000
annually for the past several years.
Clean Water Act Section 119, added in 1990, established the
EPA Long Island Sound Program Office in the vicinity of the
Sound, for the purpose of carrying out the goals of the CCMP,
coordinating federal and regional Long Island Sound activities,
conducting studies, convening state and local legislative
conferences, and providing technical support to the management
conference, among other activities. EPA funding for the Long
Island Sound office has ranged from $700,000 in 1997 up to
$975,000 in 2000.
H.R. 3313 reauthorizes funding for the Long Island Sound
program and authorizes funding for grants and studies to
implement the CCMP at an amount not to exceed $80 million a
year for fiscal years 2000 through 2003. The bill also directs
EPA's Long Island Sound Office to include, as part of its
assistance and support of CCMP implementation, efforts to
establish a nitrogen credit trading program (and any other
cost-effective measures consistent with the CCMP) within the
process of granting a watershed general permit. The bill
authorizes states to provide additional subsidization,
including forgiveness of principal for loans to designated
distressed communities from a state's clean water state
revolving fund, directs the states to establish affordability
criteria for such a designation, and authorizes EPA to provide
guidance on affordability criteria.

Discussion of Committee Bill and Section-by-Section Analysis

Section 1. Short title

Provides that the Act may be cited as the ``Long Island
Sound Restoration Act.''

Section 2. Nitrogen credit trading system and other measures

Section 2 of this legislation amends section 119(c)(1) of
the Clean Water Act to require the Office to assist and support
a system for trading nitrogen credits and any other measures
that are cost-effective and consistent with the goals of the
CCMP for Long Island Sound. This assistance and support is to
be provided under the existing authorities for the Clean Water
Act and the laws of New York and Connecticut, or any subsequent
amendments to such authorities or laws. This amendment does not
affect any existing regulatory authorities under the Clean
Water Act.
The Long Island Sound Study identified nitrogen as a key
factor causing low dissolved oxygen levels in Long Island
Sound. The nitrogen Total Maximum Daily Load for Long Island
Sound that New York and Connecticut are developing will require
a 58.5 percent nitrogen load reduction. To meet this reduction
in a cost-effective manner, Connecticut plans to institute a
nitrogen credit trading program, which the Long Island Sound
Study has helped to develop.

Section 3. Assistance for distressed communities

Amends section 119 by adding a new section authorizing New
York and Connecticut to use their state revolving loan funds,
established under title VI of the Clean Water Act, to provide
additional subsidization when making a loan to a distressed
community for the purposes of assisting the implementation of
the CCMP for Long Island Sound. This subsidization may include
forgiveness of principal. The total amount of loan subsidies
made by a state may not exceed 30 percent of the amount of the
capitalization grant received by the state for the year.
Under this section, the states of New York and Connecticut
would establish affordability criteria, after public review and
comment, to be used to determine which communities are
distressed. In establishing these criteria, the states must
consider the extent to which the rate of growth of a
community's tax base has been historically slow such that
implementing the CCMP would result in significant increases in
any water or sewer rate charged by the community's publicly-
owned wastewater treatment facility.EPA is authorized to
publish information to assist states in establishing affordability
criteria.
In its hearing on H.R. 3313, the Committee received
testimony indicating that some communities in New York and
Connecticut would have difficulty paying to add the
denitrification equipment to their wastewater treatment
facilities needed to meet the goals outlined in the CCMP. EPA,
Connecticut and New York are encouraged to fully consider the
financial stress the cleanup effort will place on the budgets
of many small towns when distributing the authorized funds and
to take advantage of the additional authorities provided in the
bill for helping municipalities fulfill their obligations under
the CCMP.
Under the reported bill, funding under section 119, as
amended, providing for construction of projects that are
treatment works as defined in the Clean Water Act, will be
subject to the requirements of the Davis-Bacon Act as provided
in section 513 of the Clean Water Act. The Committee is aware
that some of the construction funded under section 119 may not
come within the definition of treatment works. The Committee
has not addressed the issue of whether these construction
projects should be covered by the Davis-Bacon Act, and the
reported bill should not be considered as a precedent on this
issue.

Section 4. Reauthorization of appropriations

Amends section 119(f) to reauthorize funding to carry out
the duties of the Long Island Sound Office through fiscal year
2003. In addition, this section authorizes $80,000,000 a year
for each of fiscal years 2000 through 2003 to carry out section
119(d).

Hearings

On February 29, 2000, the Water Resources and Environment
Subcommittee held a hearing on H.R. 3313 and other legislation.
Testimony on H.R. 3313 was given by, among others, New York
Governor George Pataki, Connecticut Governor John Rowland,
Representative Shays (CT), Representative Johnson (CT),
Representative Lazio (NY), and Representative Ackerman (NY). In
addition, testimony on this legislation was given by
representatives of the National Audubon Society of New York,
Construction Industry Council of Westchester and Hudson Valley,
and Save The Sound, Inc.

Committee Consideration

On April 5, 2000, the Water Resources and Environment
Subcommittee reported H.R. 3313, by unanimous voice vote,
favorably to the Full Committee. The Subcommittee adopted an
amendment to change the subsidy for distressed communities from
only offering a negative interest rate to a broader array of
options, including principal forgiveness. The amendment also
capped the amount of such subsidies based on the annual
capitalization grant received by the State.
On April 11, 2000, the Full Committee met in open session
and ordered the bill reported to the House by unanimous voice
vote.

Rollcall Votes

Clause 3(b) of rule XIII of the House of Representatives
requires each committee report to include the total number of
votes cast for and against on each roll call vote on a motion
to report and on any amendment offered to the measure or
matter, and the names of those members voting for and against.
There were no recorded votes taken in connection with ordering
H.R. 3313 reported.

Committee Oversight Findings

With respect to the requirements of clause 3(c)(1) of rule
XIII of the Rules of the House of Representatives, the
Committee's oversight findings and recommendations are
reflected in this report.

Cost of Legislation

Clause 3(d)(2) of rule XIII of the Rules of the House of
Representatives does not apply where a cost estimate and
comparison prepared by the Director of the Congressional Budget
Office under section 402 of the Congressional Budget Act of
1974 has been timely submitted prior to the filing of the
report and is included in the report. Such a cost estimate is
included in this report.

Compliance with House Rule XIII

1. With respect to the requirement of clause 3(c)(2) of
rule XIII of the Rules of the House of Representatives, and
308(a) of the Congressional Budget Act of 1974, the Committee
references the report of the Congressional Budget Office
included below.
2. With respect to the requirement of clause 3(c)(4) of
rule XIII of the Rules of the House of Representatives, the
Committee has received no report of oversight findings and
recommendations from the Committee on Government Reform and
Oversight on the subject of H.R. 3313.
3. With respect to the requirement of clause 3(c)(3) of
rule XIII of the Rules of the House of Representatives and
section 402 of the Congressional Budget Act of 1974, the
Committee has received the following cost estimate for H.R.
3313 from the Director of the Congressional Budget Office.

U.S. Congress,
Congressional Budget Office,
Washington, DC, April 21, 2000.
Hon. Bud Shuster,
Chairman, Committee on Transportation and Infrastructure,
House of Representatives, Washington, DC.
Dear Mr. Chairman: The Congressional Budget Office has
prepared the enclosed cost estimate for H.R. 3313, the Long
Island Sound Restoration Act.
If you wish further details on this estimate, we will be
pleased to provide them. The CBO staff contact is Susanne S.
Mehlman (for federal costs) and Victoria Heid Hall (for the
state and local impact).
Sincerely,
Barry B. Anderson
(For Dan L. Crippen, Director).
Enclosure.

congressional budget office cost estimate

H.R. 3313--Long Island Sound Restoration Act

Summary: H.R. 3313 would extend and increase the
authorization of appropriations over the 2000-2003 period for
the Environmental Protection Agency's (EPA's) Long Island Sound
program office. Under current law, the program is authorized to
receive appropriations of $3 million annually through 2001.
This bill would authorize the appropriation of up to $80
million annually over the 2000-2003 period for EPA to make
additional grants to states and support efforts to establish a
trading program among entities in the region to exchange the
rights to emit nitrogen compounds into the Long Island Sound
watershed. In addition, enacting H.R. 3313 would give states
more flexibility in allocating funds from their revolving funds
to distressed communities with regard to the conservation and
management plan for Long Island Sound. While federal funds are
included in such revolving funds, CBO does not estimate that
enacting this provision would result in any significant impact
on the federal budget.
CBO estimates that implementing this legislation would cost
$237 million over the 2000-2005 period, assuming appropriation
of the authorized amounts. The bill would not affect direct
spending or receipts; therefore, pay-as-you-go procedures would
not apply. H.R. 3313 contains no intergovernmental mandates or
private-sector mandates as defined in the Unfunded Mandates
Reform Act (UMRA) and would impose no costs on state, local, or
tribal governments.
Estimated cost to the Federal Government: For purposes of
this estimate, CBO assumes that the amounts authorized will be
appropriated for each fiscal year and that outlays will follow
the pattern of similar EPA programs. The estimated impact of
H.R. 3313 is shown in the following table. The costs of this
legislation fall within budget function 300 (natural resources
and the environment).

----------------------------------------------------------------------------------------------------------------
By fiscal year, in millions of dollars--
-----------------------------------------------
2000 2001 2002 2003 2004 2005
----------------------------------------------------------------------------------------------------------------
SPENDING SUBJECT TO APPROPRIATION

Spending under current law:
Estimated authorization level \1\........................... 1 3 0 0 0 0
Estimated Outlays........................................... 1 2 1 1 (\2\) 0
Proposed changes:
Estimated authorization level............................... 79 77 80 80 0 0
Estimated Outlays........................................... 2 18 39 63 63 52
Spending under H.R. 3313:
Estimated authorization level............................... 80 80 80 80 0 0
Estimated Outlays........................................... 3 20 40 64 63 52
----------------------------------------------------------------------------------------------------------------
\1\ The 2000 level is the amount appropriated for that year for the Long Island Sound program at EPA. Under
current law, $3 million is authorized to be appropriated for this program in 2001.
\2\ Less than $500,000.

Pay-as-you-go considerations: None.
Intergovernmental and private-sector impact: H.R. 3313
contains no intergovernmental or private-sector mandates as
defined in UMRA and would impose no costs on state, local, or
tribal governments. Enacting the legislation would allow states
more flexibility, under permission regarding the Long Island
Sound, to prioritize certain loans to distressed communities
and to subsidize those loans. Such subsidies would be provided
by states voluntarily.
Previous CBO estimate: On October 7, 1999, CBO transmitted
a cost of estimate for S. 1632, a bill to extend the
authorization of appropriations for activities at Long Island
Sound, as ordered reported by the Senate Committee on
Environment and Public Works on September 29, 1999. In contrast
to H.R. 3313, S. 1632 would extend and increase the
authorization of appropriations for the Long Island Sound
program office by up to $10 million for each of fiscal years
2000 through 2005.
Estimate prepared by: Federal costs: Susanne S. Mehlman;
Impact on State, local and tribal governments: Victoria Heid
Hall; impact on the private sector: Jean Wooster.
Estimate approved by: Peter H. Fontaine, Deputy Assistant
Director for Budget Analysis.

Constitutional Authority Statement

Pursuant to clause (3)(d)(1) of rule XIII of the Rules of
the House of Representatives, committee reports on a bill or
joint resolution of a public character shall include a
statement citing the specific powers granted to the Congress in
the Constitution to enact the measure. The Committee on
Transportation and Infrastructure finds that Congress has the
authority to enact this measure pursuant to its powers granted
under article I, section 8 of the Constitution.

Federal Mandates Statement

The Committee adopts as its own the estimate of federal
mandates prepared by the Director of the Congressional Budget
Office pursuant to section 423 of the Unfunded Mandates Reform
Act. (Public Law 104-4.)

Advisory Committee Statement

No advisory committees within the meaning of section 5(b)
of the Federal Advisory Committee Act were created by this
legislation.

Applicability to the Legislative Branch

The Committee finds that the legislation does not relate to
the terms and conditions of employment or access to public
services or accommodations within the meaning of section
102(b)(3) of the Congressional Accountability Act. (Public Law
104-1.)

Changes in Existing Law Made by the Bill, as Reported

In compliance with clause 3(e) of rule XIII of the Rules of
the House of Representatives, changes in existing law made by
the bill, as reported, are shown as follows (existing law
proposed to be omitted is enclosed in black brackets, new
matter is printed in italic, existing law in which no change is
proposed is shown in roman):

SECTION 119 OF THE FEDERAL WATER POLLUTION CONTROL ACT

Sec. 119. Long Island Sound.--(a) * * *

* * * * * * *

(c) Duties of the Office.--The Office shall assist the
Management Conference of the Long Island Sound Study in
carrying out its goals. Specifically, the Office shall--
(1) assist and support the implementation of the
Comprehensive Conservation and Management Plan for Long
Island Sound developed pursuant to section 320 of this
Act, including efforts to establish, within the process
for granting watershed general permits, a system for
trading nitrogen credits and any other measures that
are cost-effective and consistent with the goals of the
Plan;

* * * * * * *

(e) Assistance to Distressed Communities.--
(1) Eligible communities.--
(A) States to determine criteria.--For the
purposes of this subsection, a distressed
community is any community that meets
affordability criteria established by the State
in which the community is located, if such
criteria are developed after public review and
comment.
(B) Consideration of impact on water and
sewer rates.--In determining if a community is
a distressed community for the purposes of this
subsection, the State shall consider the extent
to which the rate of growth of a community's
tax base has been historically slow such that
implementing the plan described in subsection
(c)(1) would result in a significant increase
in any water or sewer rate charged by the
community's publicly-owned wastewater treatment
facility.
(C) Information to assist states.--The
Administrator may publish information to assist
States in establishing affordability criteria
under subparagraph (A).
(2) Revolving loan funds.--
(A) Loan subsidies.--Subject to subparagraph
(B), any State making a loan to a distressed
community from a revolving fund under title VI
for the purpose of assisting the implementation
of the plan described in subsection (c)(1) may
provide additional subsidization (including
forgiveness of principal).
(B) Total amount of subsidies.--For each
fiscal year, the total amount of loan subsidies
made by a State under subparagraph (A) may not
exceed 30 percent of the amount of the
capitalization grant received by the State for
the year.
(3) Priority.--In making assistance available under
this section for the upgrading of wastewater treatment
facilities, a State may give priority to a distressed
community.
[(e)] (f) Authorizations.--(1) There is authorized to be
appropriated to the Administrator for the implementation of
this section, other than subsection (d), such sums as may be
necessary for each of the fiscal years [1991 through 2001] 2000
through 2003.
(2) There is authorized to be appropriated to the
Administrator for the implementation of subsection (d) [not to
exceed $3,000,000 for each of the fiscal years 1991 through
2001] not to exceed $80,000,000 for each of fiscal years 2000
through 2003.

* * * * * * *