H.R. 4153 (112th): Chesapeake Bay Program Reauthorization and Improvement Act

112th Congress, 2011–2013. Text as of Mar 07, 2012 (Introduced).

Status & Summary | PDF | Source: GPO

I

112th CONGRESS

2d Session

H. R. 4153

IN THE HOUSE OF REPRESENTATIVES

March 7, 2012

(for himself and Mr. Holden) introduced the following bill; which was referred to the Committee on Transportation and Infrastructure, and in addition to the Committees on Agriculture and Energy and Commerce, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned

A BILL

To support efforts to reduce pollution of the Chesapeake Bay watershed, and for other purposes.

1.

Short title; table of contents

(a)

Short title

This Act may be cited as the Chesapeake Bay Program Reauthorization and Improvement Act.

(b)

Table of contents

The table of contents for this Act is as follows:

Sec. 1. Short title; table of contents.

Sec. 2. Modification of Chesapeake Bay Program under Federal Water Pollution Control Act.

Sec. 3. Establishment of independent commission to oversee and administer nitrogen, phosphorus, and sediment trading program for Chesapeake Bay States.

Sec. 4. Chesapeake Bay watershed partnerships.

Sec. 5. Technical guidelines for environmental services markets.

Sec. 6. Chesapeake Bay watershed pilot program for creating environmental service markets.

Sec. 7. Offset.

2.

Modification of Chesapeake Bay Program under Federal Water Pollution Control Act

(a)

Definitions

Section 117(a) of the Federal Water Pollution Control Act (33 U.S.C. 1267(a)) is amended—

(1)

by redesignating paragraphs (5) and (6) as paragraphs (6) and (10), respectively;

(2)

by inserting after paragraph (4) the following new paragraph:

(5)

Chesapeake Bay State

The term Chesapeake Bay State or State means Delaware, Maryland, New York, Pennsylvania, Virginia, West Virginia, and the District of Columbia.

; and

(3)

by inserting after paragraph (6), as redesignated, the following new paragraphs:

(7)

Chief executive

The term chief executive means—

(A)

in the case of a State or Commonwealth, the Governor of the State or Commonwealth; and

(B)

in the case of the District of Columbia, the Mayor of the District of Columbia.

(8)

Nonindustrial private forest land

The term nonindustrial private forest land means rural land, as determined by the Secretary, that—

(A)

has existing tree cover or is suitable for growing trees; and

(B)

is owned by any nonindustrial private individual, group, association, corporation, Indian tribe, or other private legal entity that has definitive decisionmaking authority over the land.

(9)

Restoration Activities

The term restoration activities means one or more practices or programs that directly protect, conserve, or restore habitat, water resources, or water quality in the Chesapeake Bay watershed, including practices and programs that promote conservation and land stewardship in the Chesapeake Bay watershed.

(10)

Total maximum daily nutrient or sediment load in the Chesapeake Bay

The term total maximum daily nutrient or sediment load in the Chesapeake Bay means a total maximum daily load for nitrogen, phosphorus, or sediment established under section 303(d) for a segment or tributary of the Chesapeake Bay, whether established under paragraph (1) of such section by the State in which the segment or tributary is located or under paragraph (2) of such section by the Administrator.

.

(b)

Chesapeake Bay crosscut financial report

Section 117 of the Federal Water Pollution Control Act (33 U.S.C. 1267) is amended by striking subsection (j) and inserting the following new subsection:

(j)

Financial report

(1)

Financial report required

With the budget submission for each fiscal year, the Director of the Office of Management and Budget, in consultation with other appropriate Federal agencies and the chief executive of each Chesapeake Bay State, shall submit to Congress a financial report containing—

(A)

a summary of an interagency crosscut budget that displays—

(i)

the proposed funding for Federal restoration activities to be carried out in the succeeding fiscal year, including any planned interagency or intra-agency transfer, for each of the Federal agencies that carry out restoration activities;

(ii)

to the extent that information is available, the estimated funding for any State restoration activities to be carried out in the succeeding fiscal year;

(iii)

all expenditures for Federal restoration activities from the preceding 3 fiscal years, the current fiscal year, and estimated expenditures for the succeeding fiscal year; and

(iv)

all expenditures, to the extent that information is available, for State restoration activities during the equivalent time period described in clause (iii);

(B)

a detailed accounting of all funds received and obligated by all Federal agencies for restoration activities during the current and preceding fiscal years, including the identification of funds which were transferred to a Chesapeake Bay State for restoration activities;

(C)

to the extent that information is available, a detailed accounting from each State of all funds received and obligated from a Federal agency for restoration activities during the current and preceding fiscal years; and

(D)

a description of each of the proposed Federal and State restoration activities to be carried out in the succeeding fiscal year (corresponding to those activities listed in clauses (i) and (ii) of subparagraph (A)).

(2)

Submission

Not later than 30 days after the submission by the President of the annual budget to Congress, the Director shall submit the report required by paragraph (1) to the following congressional committees:

(A)

The Committees on Agriculture, Appropriations, Natural Resources, Energy and Commerce, and Transportation and Infrastructure of the House of Representatives.

(B)

The Committees on Agriculture, Nutrition, and Forestry, Appropriations, Environment and Public Works, and Commerce, Science, and Transportation of the Senate.

.

(c)

Transparency and accountability

Section 117 of the Federal Water Pollution Control Act (33 U.S.C. 1267) is amended by adding at the end the following new subsection:

(k)

Transparency and accountability requirements

(1)

State Reports

Not later than October 10 of each year, each State that received funds from a Federal agency under subsection (n)(1)(B) shall submit a report to the head of the agency that—

(A)

identifies the total amount of funds received from the agency under such provisions during the preceding fiscal year;

(B)

identifies the amount of funds received from the agency under such provisions that were obligated or expended for projects or activities during the preceding fiscal year; and

(C)

contains a list of all projects or activities for which the funds were obligated or expended, except that such list shall not include personal identifying information of individual recipients.

(2)

Agency reports

Not later than November 10 of each year, the Secretary of Agriculture shall provide to the Administrator the information received in any report submitted to the Secretary under paragraph (1). The Administrator shall publish on a publicly available website, in accordance with paragraph (5), any information submitted to the Administrator under this paragraph or paragraph (1).

(3)

Economic analysis

(A)

In general

The Administrator shall complete an economic analysis of each agency statement described in subparagraph (B) that is issued by the Administrator.

(B)

Agency statement described

An agency statement described in this subparagraph is any guidance, policy, memorandum, regulation, or statement of general applicability and future effect that is designed to implement, interpret, or prescribe law or policy relating to water quality in the Chesapeake Bay.

(C)

Contents of analysis

An economic analysis required under subparagraph (A) shall include—

(i)

the impact of the agency statement on the economies and budgets of States and municipalities;

(ii)

the impact of the agency statement on the private sector, including such impact on small entities and farm income;

(iii)

the availability of Federal funding to offset the impacts identified under clause (ii); and

(iv)

the benefits of the agency statement to water quality in the Chesapeake Bay.

(D)

Consultation

In conducting an economic analysis required under subparagraph (A), the Administrator shall consult with other Federal agencies that may be affected by the agency statement.

(4)

Initial Compliance

Not later than 180 days after the date of enactment of the Chesapeake Bay Program Reauthorization and Improvement Act, the head of each Federal agency providing funds under subsection (n)(1)(B) shall require, as a condition of receipt of the funds, a State recipient of the funds to provide the information required under paragraph (1).

(5)

Website

(A)

Website required

The Administrator shall establish and maintain, not later than 30 days after the enactment of the Chesapeake Bay Program Reauthorization and Improvement Act, a user-friendly, publicly available website to promote greater accountability and transparency regarding the use of funds provided under subsection (n)(1)(B).

(B)

Content and function

The website shall provide the following:

(i)

Accountability information, including findings from audits, inspectors general, and the Government Accountability Office.

(ii)

Data on relevant economic, financial, grant, and contract information in user-friendly visual presentations to enhance public awareness of the use of covered funds.

(iii)

Links to other government websites where key information relating to efforts to improve the water quality of the Chesapeake Bay watershed may be found.

(iv)

Printable reports on covered funds obligated by month to each State and congressional district.

(v)

Links to other government websites with information concerning covered funds, including Federal agency and State websites.

(C)

Revisions

The Administrator shall enhance and update the website as necessary.

.

(d)

Independent evaluation and technical advisory committee for Chesapeake bay program

Section 117 of the Federal Water Pollution Control Act (33 U.S.C. 1267) is amended by inserting after subsection (k), as added by subsection (c), the following new subsection:

(l)

Independent evaluation and technical advisory committee

(1)

Establishment

There is established an Independent Evaluation and Technical Advisory Committee (in this subsection referred to as the Advisory Committee).

(2)

Review and report

Beginning on a date that is not more than 180 days after the date of enactment of the Chesapeake Bay Program Reauthorization and Improvement Act, and every two years thereafter, the Advisory Committee shall review and report to Congress on—

(A)

Federal and State, and, to the extent practicable, other, restoration activities in the Chesapeake Bay watershed, including relevant topics suggested by the Chesapeake Executive Council and the Chesapeake Bay Commission; and

(B)

any progress made by such activities toward reaching applicable water quality goals of the Chesapeake Bay States.

(3)

Duties

(A)

Administration review

The duties of the Advisory Committee shall be to provide recommendations to the Administrator and Secretary of Agriculture concerning the administration of this section.

(B)

Program and activities review

The Advisory Committee shall, after reviewing the Chesapeake Bay Program, provide to the Administrator and the Secretary of Agriculture a report evaluating whether—

(i)

funds authorized for restoration activities are being distributed and used to improve water quality in the Chesapeake Bay watershed;

(ii)

mechanisms to track restoration activities are in place and restoration activities are being properly implemented;

(iii)

mechanisms are in place to evaluate progress toward achieving water quality goals for the Chesapeake Bay watershed;

(iv)

the allocation of funds among Chesapeake Bay States reflects the responsibility and contribution towards achieving water quality goals of each Chesapeake Bay State;

(v)

restoration activities are being carried out in accordance with this section;

(vi)

the factual information and assumptions incorporated in Chesapeake Bay modeling efforts are accurate;

(vii)

implementation of restoration activities is being adequately tracked and accounted for in Chesapeake Bay modeling efforts, including tracking of privately funded and government-funded practices; and

(viii)

the achievability and practicability of water quality goals are being considered in the implementation of the Program.

(4)

Membership

(A)

Number and Appointment

The Advisory Committee shall be composed of 16 members appointed by the Administrator and the Secretary of Agriculture, composed of the following:

(i)

Two individuals who are engineers or scientists who worked for the Government or in academia and have technical expertise in water quality modeling.

(ii)

One individual who has an affiliation with an institution of higher education and technical expertise in water quality.

(iii)

Nine individuals, of whom at least one shall have professional experience and expertise in each of the following areas:

(I)

Urban storm water issues.

(II)

Agricultural storm water issues.

(III)

Urban and suburban development.

(IV)

Water quality modeling.

(V)

Economics.

(VI)

Agronomy, crop science, or soil science.

(VII)

Wastewater treatment systems.

(VIII)

Marine biology or fish and wildlife habitats.

(IX)

Applying for and complying with building permits.

(iv)

Four individuals, at least one of whom shall be affiliated with each of the following:

(I)

An environmental or conservation organization.

(II)

A fishing, hunting, or outdoor sporting organization operating in the Chesapeake Bay watershed.

(III)

Nongovernmental agriculture producer associations or other groups of producers related to livestock.

(IV)

Agricultural conservation organizations with an established history of working cooperatively with producers on agricultural lands.

(B)

Term

Each member of the Advisory Committee shall be appointed for a term of two years. No member may be appointed for more than three terms.

(C)

Meetings

The Advisory Committee shall meet on a quarterly basis.

(5)

Bylaws

The Advisory Committee shall establish any bylaws necessary for the advisory committee to carry out its duties under this subsection. Such bylaws shall include provisions to prevent any conflict of interest or the appearance of any conflict of interest in the actions taken or recommendations made by the Advisory Committee or by any member of the Advisory Committee.

(6)

Administrative support

The Secretary of Agriculture shall provide to the Advisory Committee any administrative support services necessary for the Advisory Committee to carry out its responsibilities under this section.

(7)

Coordination

To avoid duplication of effort, the Advisory Committee shall coordinate activities with other Federal advisory committees working in related areas.

(8)

No regulatory authority

The Advisory Committee does not have the authority to recommend or promulgate regulations.

.

(e)

Nitrogen, Phosphorus, and Sediment Trading Technical Guidelines

Section 117 of the Federal Water Pollution Control Act (33 U.S.C. 1267) is amended by inserting after subsection (l) (as added by subsection (d)), the following new subsection:

(m)

Nitrogen, Phosphorus, and Sediment Trading Technical Guidelines

(1)

Establishment

Not later than 14 months after the date of enactment of the Chesapeake Bay Program Reauthorization and Improvement Act, the Administrator, in consultation with the Secretary of Agriculture and the Chesapeake Bay States, shall establish technical guidelines to be used by the Chesapeake Bay Nutrient and Sediment Trading Commission in establishing a voluntary interstate nitrogen, phosphorus, and sediment trading program for the Chesapeake Bay.

(2)

Limitation on application

Technical guidelines established under this subsection shall not apply to agricultural nonpoint sources or nonindustrial private forest lands except to the extent that such guidelines consist of guidelines issued under section 1245 of the Food Security Act of 1985 (16 U.S.C. 3845).

(3)

Elements

The technical guidelines established under this subsection shall, at a minimum—

(A)

define and standardize nitrogen, phosphorus, and sediment credits and establish procedures or standards for ensuring equivalent water quality benefits for all credits;

(B)

establish procedures or standards for credit practices, for both point sources and nonpoint sources (except as provided in paragraph (2)), that measure reductions in nitrogen, phosphorus, and sediment from credit-generating practices;

(C)

establish procedures or standards for generating, quantifying, trading, banking, and applying credits to meet regulatory requirements;

(D)

establish baseline requirements, relevant to the credit being traded, that a credit seller must meet before becoming eligible to generate saleable credits; and

(E)

develop and incorporate an approach, consistent with subsection (o), that creates a general approval for trading, thereby avoiding the need to reopen or reissue permits issued under section 402 to incorporate individual trades.

.

(f)

Authorization of appropriations and grant authority

Section 117 of the Federal Water Pollution Control Act (33 U.S.C. 1267) is amended by inserting after subsection (m) (as added by subsection (e)) the following new subsection:

(n)

Funding

(1)

Authorization of appropriations

There are authorized to be appropriated to the Administrator for each of fiscal years 2013 through 2018, to remain available until expended—

(A)

$50,000,000 to carry out this section; and

(B)

$40,000,000 to support the Chesapeake Bay States in carrying out activities related to a total maximum daily nutrient or sediment load in the Chesapeake Bay.

(2)

Incentive payments

(A)

Reservation of funds

Of the amounts appropriated under paragraph (1)(B), the Administrator shall reserve the following percentages for allocation in accordance with subparagraph (B):

(i)

Ten percent in each of fiscal years 2013 and 2014.

(ii)

Twenty percent in each of fiscal years 2015 and 2016.

(iii)

Fifty percent in each of fiscal years 2017 and 2018.

(B)

Allocation to Chesapeake Bay States

(i)

Determination

For each fiscal year, the Administrator, in consultation with the Secretary of Agriculture and using information provided in the report of the Advisory Committee required under subsection (l), shall determine whether each Chesapeake Bay State has made sufficient progress toward meeting water quality goals and is properly managing financial resources intended to enable the State to meet such goals.

(ii)

Allocation

The Administrator, in consultation with the Secretary of Agriculture, shall allocate the amounts reserved under subparagraph (A) in each fiscal year among the Chesapeake Bay States the Administrator has determined under clause (i) have made sufficient progress toward meeting water quality goals and are properly managing financial resources intended to enable the State to meet such goals.

(C)

Use of funds

A State may use amounts allocated under this paragraph for carrying out activities related to a total maximum daily nutrient or sediment load in the Chesapeake Bay.

(3)

Grants

Of the amounts authorized to be appropriated under paragraph (1)(B), after the reservation of funds under paragraph (2)—

(A)

30 percent shall be used for grants to any municipal, intermunicipal, or State agency in a Chesapeake Bay State, or to any interstate agency in two or more Chesapeake Bay States, for the construction, operation, and maintenance of publicly owned treatment works, as defined in section 212;

(B)

35 percent shall be used for grants to any municipality in a Chesapeake Bay State for the construction, operation, and maintenance of a municipal separate storm sewer system subject to regulation under section 402(p); and

(C)

35 percent shall be distributed to the Secretary of Agriculture to carry out section 1240Q(i) of the Food Security Act of 1985 (which amounts shall be in addition to funding provided under such Act).

(4)

Distribution

(A)

Priority

The Administrator shall distribute amounts under paragraphs (2), (3)(A), and (3)(B) with priority given to Maryland, Virginia, Pennsylvania, and the District of Columbia.

(B)

Minimum amount

The Administrator shall distribute to each Chesapeake Bay State not less than 7 percent of the amounts under paragraphs (3)(A) and (3)(B).

.

(g)

Total maximum daily loads for nitrogen, phosphorus, or sediment in the Chesapeake Bay

Section 117 of the Federal Water Pollution Control Act (33 U.S.C. 1267) is amended by inserting after subsection (n) (as added by subsection (f)), the following new subsection:

(o)

Total maximum daily loads for nitrogen, phosphorus, or sediment in the Chesapeake Bay

(1)

Total maximum daily nutrient or sediment load in the Chesapeake Bay duration

Any total maximum daily nutrient or sediment load in the Chesapeake Bay shall use timeframes other than daily (such as annual, monthly, or seasonal) for certain economic sectors, including agriculture, in which a nondaily timeframe is appropriate.

(2)

Use of trading

In any case in which a point source is subject to an effluent limit in a permit issued under section 402 for nitrogen, phosphorus, or sediment, such point source may meet that permit limit in whole or in part through a trade administered by the Chesapeake Bay Nutrient and Sediment Trading Commission established by section 117A.

(3)

Corresponding load reductions

For any total maximum daily nutrient or sediment load in the Chesapeake Bay, a process shall be developed—

(A)

to account for reductions in loadings to the Chesapeake Bay watershed of nitrogen, phosphorus, and sediment, including those achieved by entities that do not have a total maximum daily load allocation for such pollutants, and including reductions achieved by restoration activities implemented by private entities, local governments, States, and Federal agencies, including the Department of Agriculture; and

(B)

to increase wasteload and load allocations on a proportional basis by the amount of such reductions.

(4)

State implementation

Powers are reserved solely to the States to implement a total maximum daily nutrient or sediment load in the Chesapeake Bay, including authority to assign load and waste load allocations to individual sources and source sectors to achieve a total maximum daily nutrient or sediment load in the Chesapeake Bay. At the request of a Chesapeake Bay State, the Administrator may review a State implementation plan and offer non-binding recommendations for consideration by the State, but may not take any action to supersede any such State implementation.

(5)

Adaptive management

(A)

In general

If a Chesapeake Bay State develops a plan to implement a total maximum daily nutrient or sediment load in the Chesapeake Bay that provides for reductions in loading through an iterative process that employs adaptive management principles, permits may be issued under section 402 for new or existing point source discharges that—

(i)

include wasteload allocations consistent with such plan; and

(ii)

demonstrate progress towards achieving the wasteload allocation specified in such plan by treatment, trading, or other means, in accordance with the schedule provided in such plan, as determined by the permit issuing authority.

(B)

Assessment of progress

In assessing sufficient progress by municipal dischargers and other point sources toward meeting water quality goals and plans, the availability, cost, effectiveness, and appropriateness of practices, techniques, methods, or other provisions for the control of such pollutants shall be considered.

(6)

Options for offsetting of stormwater management requirements

An individual or entity undertaking land development activities may meet the applicable stormwater management requirements by offsetting such activities through the establishment of stormwater management practices off-site within the Chesapeake Bay watershed. Offsetting stormwater management practices shall include, at a minimum, the establishment of riparian forest buffers, streambank fencing, or other best management practices on agricultural lands.

(7)

Relation to watershed partnerships

A Chesapeake Bay State may use funds made available to the State under section 319 for activities related to reducing losses of nitrogen, phosphorus, or sediment from agricultural or nonindustrial private forest land through a watershed partnership developed under section 1240Q(i) of the Food Security Act of 1985. Use of funds in such manner shall have no effect on the availability to the State of other funds under this Act.

.

3.

Establishment of independent commission to oversee and administer nitrogen, phosphorus, and sediment trading program for Chesapeake Bay States

The Federal Water Pollution Control Act is amended by inserting after section 117 (33 U.S.C. 1267) the following new section:

117A.

Chesapeake Bay Nutrient and Sediment Trading Commission

(a)

Definitions

In this section:

(1)

Commission

The term Commission means the Chesapeake Bay Nutrient and Sediment Trading Commission established in subsection (b).

(2)

Chesapeake Bay State

The term Chesapeake Bay State means Delaware, Maryland, New York, Pennsylvania, Virginia, West Virginia, and the District of Columbia.

(3)

Chesapeake Executive Council

The term Chesapeake Executive Council means the signatories to the Chesapeake Bay Agreement.

(4)

Chesapeake Bay Agreement

The term Chesapeake Bay Agreement means the formal, voluntary agreements executed to achieve the goal of restoring and protecting the Chesapeake Bay ecosystem and the living resources of the Chesapeake Bay ecosystem and signed by the Chesapeake Executive Council.

(b)

Establishment of Commission; purpose

(1)

In general

There is established a Chesapeake Bay Nutrient and Sediment Trading Commission to oversee and administer a nitrogen, phosphorus, and sediment trading program for the Chesapeake Bay States to ensure credits are generated to attract market participants and facilitate trading mechanisms among and within such States to meet water quality goals.

(2)

Independent establishment

The Commission shall be an independent establishment, as defined in section 104 of title 5, United States Code.

(3)

Location

The Commission shall be housed at the Office of the Chesapeake Bay Program directed by the Chesapeake Executive Council in accordance with the Chesapeake Bay Agreement.

(c)

Duties

(1)

Credits for water quality trading

In consultation with market developers, Chesapeake Bay States, and appropriate Federal agencies, the Commission shall develop a system to facilitate and generate credits for interstate water quality trading among and within the Chesapeake Bay States.

(2)

Water quality trading registry

The Commission shall obtain information from the Administrator, the Secretary of Agriculture, and other Federal agencies to operate and oversee a registry for interstate water quality trading in the Chesapeake Bay States.

(3)

Trade recordkeeping

The Commission shall develop and maintain a system to record specific interstate water quality trades among and within the Chesapeake Bay States.

(4)

Point source and nonpoint source trades

In consultation with market developers and appropriate Federal agencies, the Commission shall develop a system to allow for trading to occur between point sources and nonpoint sources, and any combination thereof, among and within the Chesapeake Bay States.

(5)

Consistency with state program

The Commission shall not establish or operate a program that conflicts with or modifies a State program for intrastate trading.

(6)

Deadline; publication

Not later than 2 years after the date of enactment of the Chesapeake Bay Program Reauthorization and Improvement Act, the Commission shall promulgate rules for interstate water quality trading among and within the Chesapeake Bay States, and shall publish such rules in the Federal Register.

(d)

Use of technical guidelines

The Commission shall rely on the Administrator to provide technical guidelines under section 117(m) and the Secretary of Agriculture to provide technical guidelines under section 1245(b) of the Food Security Act of 1985.

(e)

Members of commission

(1)

Composition

The Commission shall consist of five members, of which—

(A)

one member shall be appointed by the Secretary of Agriculture;

(B)

one member shall be appointed by the Administrator; and

(C)

three members shall be appointed jointly by the Administrator and the Secretary of Agriculture from among persons nominated by the Governors of each of the signatory States of the Chesapeake Bay Agreement.

(2)

Special considerations

Of the members of the Commission—

(A)

one member shall be a representative of the general public;

(B)

not more than two of the members may have similar professional experience or expertise in the same field;

(C)

at least one of the members shall be experienced in a market-based pollutant trading mechanism; and

(D)

not more than three of the members may be of the same political party.

(3)

Terms

The members of the Commission shall serve a term of five years and may be reappointed.

(4)

Chairperson

The members of the Commission shall designate one of the members to serve as chairperson.

(5)

Meetings

The Commission shall meet at the call of the chairperson or a majority of its members, and shall hold public meetings at intervals as are necessary to carry out the functions of the Commission, but not less frequently than 2 times per year.

(f)

Officers and staff

The Commission may appoint, employ, fix the pay of, and provide other allowances and benefits for such officers and employees of the Commission as the members determine to be appropriate.

(g)

Relationship with other entities

(1)

Liaisons

(A)

Commission liaisons

(i)

In general

The Commission shall, in cooperation with the Administrator and the Secretary of Agriculture, maintain—

(I)

a liaison between the Commission and the Environmental Protection Agency; and

(II)

a liaison between the Commission and the Department of Agriculture.

(ii)

Effective maintenance

The Administrator and Secretary of Agriculture shall take such steps as may be necessary to enable the Commission to obtain information and utilize such services and facilities of the Environmental Protection Agency and Department of Agriculture as may be necessary in order to maintain effectively such liaisons.

(B)

Agency liaison officers

The Administrator and Secretary of Agriculture shall each appoint a liaison officer, who shall be an employee of the Environmental Protection Agency and the Department of Agriculture, respectively, for the purpose of communicating with the liaison maintained under subparagraph (A) and the Commission.

(C)

Attendance

The Commission shall allow the liaisons and liaison officers to attend and observe all deliberations and proceedings of the Commission.

(2)

Maintenance of communications

The Commission shall maintain communications with the Chesapeake Executive Council and the Chesapeake Bay States for the purposes of—

(A)

keeping such entities fully informed of Commission activities that relate to the responsibilities of those entities;

(B)

seeking views of those entities on such activities; and

(C)

consultation with such entities regarding the relationships between Commission activities and the jurisdiction of such entities.

(h)

Duration

The Commission shall terminate on September 30, 2018.

.

4.

Chesapeake Bay watershed partnerships

Section 1240Q of the Food Security Act of 1985 (16 U.S.C. 3839bb–4) is amended—

(1)

by striking subsection (a) and inserting the following:

(a)

Definitions

In this section:

(1)

Chesapeake Bay State

The term Chesapeake Bay State or State means Delaware, Maryland, New York, Pennsylvania, Virginia, West Virginia, and the District of Columbia.

(2)

Chesapeake Bay watershed

The term Chesapeake Bay watershed means all tributaries, backwaters, and side channels, including their watersheds, draining into the Chesapeake Bay.

(3)

Chief executive

The term chief executive means—

(A)

in the case of a State or Commonwealth, the Governor of the State or Commonwealth; and

(B)

in the case of the District of Columbia, the Mayor of the District of Columbia.

; and

(2)

by adding at the end the following new subsection:

(i)

Chesapeake Bay watershed partnerships

(1)

In general

At the request of the chief executive of a Chesapeake Bay State, the Secretary shall enter into a memorandum of understanding with such chief executive establishing a partnership between the Secretary and the State (in this subsection referred to as a watershed partnership) in accordance with this subsection.

(2)

Watershed strategy

Each watershed partnership may establish a watershed strategy for demonstrating aggregate reductions in losses of nitrogen, phosphorus, and sediment, on a basin or subbasin scale in the Chesapeake Bay watershed, from agricultural or nonindustrial private forest land in the State, including developing processes for—

(A)

identifying basins or subbasins in which implementation of enhanced conservation practices could significantly impact water quality;

(B)

identifying achievable and cost-effective conservation practices that result in such reductions to improve water quality;

(C)

statistically validating and verifying conservation practices;

(D)

establishing methods of estimating such reductions that are statistically valid and accurate, based on field- and farm-level surveys conducted by the Secretary, to the extent practicable using existing data collection methods; and

(E)

collecting other relevant information on practices that demonstrate such reductions, as determined by the Secretary and the chief executive of the State.

(3)

Assurance

(A)

Establishment of assurance process

Each watershed strategy established by a watershed partnership shall require the chief executive of the State, in collaboration with the Secretary, to establish an assurance process in which producers or owners of nonindustrial private forest land in the State may participate if such producers or owners of nonindustrial forest land are qualified under subparagraph (B) by implementing and maintaining conservation practices, on agricultural or nonindustrial forest land in the Chesapeake Bay watershed, that are designed to reduce losses of nitrogen, phosphorus, and sediment from such land, as determined by the State.

(B)

Qualified producers and owners

For the purposes of this paragraph, a qualified producer or owner of nonindustrial private forest land is a producer or owner of nonindustrial private forest land that implements and maintains conservation practices, on agricultural or nonindustrial forest land in the Chesapeake Bay watershed, that are designed to reduce losses of nitrogen, phosphorus, and sediment from such land, as determined by the State.

(C)

Effect of participation in assurance process

(i)

In general

A qualified producer or owner of nonindustrial private forest land that participates in an assurance process under this paragraph shall be considered to be in full compliance with applicable water quality requirements, if any, regarding nitrogen, phosphorus, and sediment in the Chesapeake Bay watershed, with respect to such land, such that no additional water quality-related conservation practices may be required on such land during the period of time in which the producer or owner of nonindustrial private forest land participates in the assurance process.

(ii)

Operations on land

Operations on such land conducted by such a qualified producer or owner shall not be considered to be a significant contributor of nitrogen, phosphorus, or sediment to waters in the Chesapeake Bay watershed.

(D)

Verification

The chief executive of the State shall verify conservation practices maintained by qualified producers and owners participating in an assurance process under this paragraph.

(4)

Use of existing programs required

In accordance with subsection (e)(1), a watershed partnership shall use existing programs, including for risk assessment, conservation planning, measurement and assessment of progress in improving water quality, and validation and verification of practices in the State to reduce losses of nitrogen, phosphorus, and sediment from agricultural or nonindustrial private forest land in the Chesapeake Bay watershed.

(5)

State water quality goals

The chief executive of a State that has entered into a watershed partnership under this subsection shall ensure that any watershed strategy established under paragraph (2) is incorporated into the overall water quality goals established by the State, on a basin or subbasin level, for agricultural and nonindustrial private forest land in the State.

(6)

Assessments of progress

(A)

Assessment

Not later than 5 years after the date on which a watershed partnership is established under paragraph (1), and every 5 years thereafter, the chief executive of the Chesapeake Bay State shall make public an assessment of the progress in the State in reducing losses of nitrogen, phosphorus, and sediment from agricultural and nonindustrial private forest land in the Chesapeake Bay watershed, on a basin or subbasin level, in accordance with the water quality goals of the State described in paragraph (5). Such assessment shall incorporate an analysis of data developed and published under subparagraph (B).

(B)

Development and publication of data

The Secretary shall publish in a conservation assessment report issued by the Natural Resources Conservation Service data developed by the Secretary for incorporation into assessments required under subparagraph (A).

(C)

Effect of assessment

If the chief executive of a Chesapeake Bay State determines, in an assessment required under subparagraph (A), that aggregate reductions in losses of nitrogen, phosphorus, and sediment from agricultural and nonindustrial private forest land in a basin or subbasin of the Chesapeake Bay watershed in the State have been achieved in accordance with the water quality goals of the State described in paragraph (5)—

(i)

during a period determined by the chief executive of the State, no further reductions in losses of nitrogen, phosphorus, or sediment may be required by the State or Federal Government from agricultural or nonindustrial private forest land in the basin or subbasin; and

(ii)

during such period, no operations conducted on agricultural or nonindustrial private forest land in the basin or subbasin shall be considered to be a significant contributor of nitrogen, phosphorus, or sediment to waters in the Chesapeake Bay watershed.

(7)

Assistance from Secretary

(A)

Technical Assistance

In carrying out a watershed partnership, the Secretary shall provide technical assistance—

(i)

to the State to assist in developing the water quality goals of the State to result in reductions in losses of nitrogen, phosphorus, and sediment from agricultural or nonindustrial private forest land in the Chesapeake Bay watershed to improve water quality in the Chesapeake Bay watershed; and

(ii)

to producers and owners of nonindustrial private forest land in the State—

(I)

for education regarding activities they can undertake to reduce losses of nitrogen, phosphorus, and sediment from such land in the Chesapeake Bay watershed; and

(II)

for assistance with conservation planning, implementation, and maintenance to reduce losses of nitrogen, phosphorus, and sediment from such land in the Chesapeake Bay watershed.

(B)

Economic Analysis

In providing assistance under this paragraph, the Secretary shall consider the practicability and economic achievability of the conservation practices that may be needed to reduce losses of nitrogen, phosphorus, and sediment from agricultural or nonindustrial private forest land in the Chesapeake Bay watershed to improve water quality in the Chesapeake Bay watershed.

(8)

Rule of construction

Nothing in this subsection may be construed as a grant of regulatory authority to the Secretary.

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5.

Technical guidelines for environmental services markets

(a)

Types of guidelines required

(1)

Impaired watershed guidelines

Section 1245(a) of the Food Security Act of 1985 (16 U.S.C. 3845(a)) is amended by adding at the end In addition, not later than 14 months after the date of the enactment of the Chesapeake Bay Program Reauthorization and Improvement Act, the Secretary shall establish guidelines for farmer, rancher, and forest landowner participation in voluntary nutrient and sediment trading systems established for the purpose of addressing impaired watersheds..

(2)

Additional guidelines

Section 1245(b) of the Food Security Act of 1985 (16 U.S.C. 3845(b)) is amended by striking paragraphs (1), (2), and (3) and inserting the following new paragraphs:

(1)

Methodologies for quantifying environmental service benefits.

(2)

Baseline methodologies for environmental service benefits.

(3)

Methodologies to account for reversals and leakage for environmental services markets.

(4)

Methodologies for verification of the environmental service benefits.

(5)

A protocol to report environmental service benefits.

(6)

A registry to collect, record, and maintain the benefits measured.

(7)

A procedure to verify and ensure that environmental service benefits comply with Federal and State regulations.

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(3)

Conforming amendments

Section 1245(c)(1) of the Food Security Act of 1985 (16 U.S.C. 3845(c)(1)) is amended—

(A)

by striking paragraph (2) and inserting paragraph (5); and

(B)

by striking paragraph (3) and inserting paragraph (6).

(b)

Additional requirements

Section 1245 of the Food Security Act of 1985 (16 U.S.C. 3845) is amended by adding at the end the following new subsections:

(f)

List of eligible activities

(1)

List required

The Secretary shall publish a list of eligible domestic agricultural and forestry activities that result in environmental service benefits.

(2)

Deadline; publication

Not later than 14 months after the date of the enactment of the Chesapeake Bay Program Reauthorization and Improvement Act, the Secretary shall publish in the Federal Register the list of domestic agricultural and forestry activities that are eligible for trading under the guidelines established under subsection (a).

(3)

Recommendations

In preparing the list under this subsection, the Secretary shall take into consideration the recommendations of the entities referred to in subsection (e).

(4)

Additions and revisions

Not later than 4 years after the date of the enactment of the Chesapeake Bay Program Reauthorization and Improvement Act, and every two years thereafter, the Secretary shall update and revise the list prepared under this subsection. The updates and revisions shall be made only after the Secretary provides an opportunity for public notice of and an opportunity for comment on the proposed updates and revisions.

(g)

Guidelines for provision of technical assistance

(1)

Verification guidelines

The Secretary shall establish guidelines for, and provide, technical assistance under this section to ensure that—

(A)

environmental service benefits have been implemented properly; and

(B)

the quantification of such benefits has resulted in an environmental benefit.

(2)

Technical Assistance Provider Accreditation

As part of the guidelines established under this section, the Secretary shall develop a process and requirements for periodic accreditation of certified technical assistance providers for environmental service benefits to ensure that such providers are professionally qualified and have no conflicts of interest. Each technical service provider meeting the requirements for accreditation in accordance with this paragraph shall be listed in a publicly accessible database, which shall be maintained and updated by the Secretary.

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6.

Chesapeake Bay watershed pilot program for creating environmental service markets

Section 1240Q of the Food Security Act of 1985 (16 U.S.C. 3839bb–4) is amended by inserting after subsection (i) (as added by section 4), the following new subsection:

(j)

Pilot program for creating environmental service markets

(1)

Establishment

The Secretary shall establish a pilot program for the Chesapeake Bay watershed, for the facilitation of creating environmental service markets based on the guidelines outlined in section 1245(g), that does not result in removing eligible land wholly from agricultural production or eliminating the economic viability of such agricultural production. The Secretary shall ensure that the pilot program is consistent with local government rules and the policies, protocols, and regulations established under existing environmental service markets and State trading programs in the Chesapeake Bay watershed.

(2)

Transmission of data to Chesapeake Bay Nutrient and Sediment Trading Commission

The Secretary shall transmit to the Chesapeake Bay Nutrient and Sediment Trading Commission established under section 117A of the Federal Water Pollution Control Act, any data the Secretary determines is necessary to the effective administration of nutrient and sediment trading programs administered by such Commission.

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7.

Offset

There is authorized to be appropriated to the Environmental Protection Agency for the Environmental Programs and Management account for each of fiscal years 2013 through 2018 the amount that is $40,000,000 less than the amount appropriated for such account for fiscal year 2012, to be derived from amounts available for administrative expenses.