119th CONGRESS

1st Session

S. 2712

1. Short title
2. Climate Change Finance Corporation
3. Carbon fee
4. America's Clean Future Fund
5. America's Clean Future Fund Stimulus
6. Agricultural decarbonization transition payments
7. Transition assistance for impacted communities
8. Study on carbon pricing
9. Establishment of targets for carbon sequestration by land and water

1. Short title

This Act may be cited as the "America's Clean Future Fund Act".

2. Climate Change Finance Corporation

(a) Establishment

(1) In general - There is established in the executive branch an independent agency, to be known as the "Climate Change Finance Corporation" (referred to in this section as the "C2FC"), which shall finance clean energy and climate change resiliency activities in accordance with this section.

(2) Mission - The mission of the C2FC is to combat climate change by reducing the dependency of the United States on fossil fuels, reducing greenhouse gas emissions, and building resilience to the harmful impacts of climate change.

(3) Activities

(A) In general - The C2FC shall reduce the reliance of the United States on fossil fuels and mitigate the impacts of climate change by financing—

(i) - the deployment of low- and zero-emissions energy technologies and fuels;

(ii) - the construction of climate-resilient infrastructure;

(iii) - research, development, and commercialization of new climate-smart technologies and tools to facilitate industrial decarbonization;

(iv) - clean energy and climate projects identified as too high-risk for private capital investment; and

(v) - projects that encourage the infusion of private capital and the creation of new workforce opportunities in clean transportation, energy, and climate resiliency.

(B) Priority - In carrying out activities under subparagraph (A), the C2FC shall give priority to projects that benefit—

(i) - communities disproportionately facing the harmful impacts of climate change;

(ii) - communities that have been historically overburdened by industrial pollution from carbon-intensive industries; and

(iii) - communities that have historically relied on carbon-intensive industries for economic support.

(C) Emissions reduction goals - In carrying out activities under subparagraph (A), the goals of the C2FC shall be to achieve—

(i) - by 2030, a net reduction of greenhouse gas emissions by 45 percent, based on 2018 levels; and

(ii) - by 2050, a net reduction of greenhouse gas emissions by 100 percent, based on 2018 levels.

(4) Exercise of powers - Except as otherwise provided expressly by law, all Federal laws dealing with public or Federal contracts, property, works, officers, employees, budgets, or funds, including the provisions of chapters 5 and 7 of title 5, United States Code, shall apply to the exercise of the powers of the C2FC.

(b) Board of directors

(1) In general - The management of the C2FC shall be vested in a Board of Directors (referred to in this section as the "Board") consisting of 7 members, who shall be appointed by the President, by and with the advice and consent of the Senate.

(2) Chairperson and vice chairperson

(A) In general - A Chairperson and Vice Chairperson of the Board shall be appointed by the President, by and with the advice and consent of the Senate, from among the individuals appointed to the Board under paragraph (1).

(B) Term - An individual—

(i) - shall serve as Chairperson or Vice Chairperson of the Board for a 3-year term; and

(ii) - may be renominated for the position until the term of that individual on the Board under paragraph (3)(C) expires.

(3) Board members

(A) Citizenship required - Each member of the Board shall be an individual who is a citizen of the United States.

(B) Representation - The members of the Board shall represent agricultural, educational, research, industrial, nongovernmental, labor, environmental justice, and commercial interests throughout the United States.

(i) In general - Except as otherwise provided in this section, each member of the Board—

(I) - shall be appointed for a term of 6 years; and

(II) - may be reappointed for 1 additional term.

(ii) Initial staggered terms - Of the members first appointed to the Board—

(I) - 2 shall each be appointed for a term of 2 years;

(II) - 3 shall each be appointed for a term of 4 years; and

(III) - 2 shall each be appointed for a term of 6 years.

(4) Initial meeting - Not later than 30 days after the date on which all members of the Board are appointed under paragraph (1), the Board shall hold an initial meeting.

(1) In general - The Board shall create, oversee, and incorporate feedback from the following working groups (each referred to in this section as a "working group"):

(A) - An environmental justice working group.

(B) - A worker and community transition assistance working group.

(2) Working group members

(A) In general - Each working group shall—

(i) - be chaired by a Board member; and

(ii) - comprise not less than 10 and not more than 20 individuals, who shall be experts, members of directly impacted communities relating to the subject matter of the working group, and other relevant stakeholders.

(B) Diversity - Individuals on a working group shall, to the maximum extent practicable, represent—

(i) - a diverse array of interests related to the subject matter of the working group; and

(ii) - diverse geographical, racial, religious, gender, educational, age, disability, and socioeconomic backgrounds.

(3) Meetings - Each working group shall meet not less than 2 times per year.

(4) Community and stakeholder engagement

(A) In general - Each working group shall create and engage in meaningful community and stakeholder involvement opportunities, including through regular public community engagement activities, for purposes of—

(i) - maintaining up-to-date situational awareness about the needs of relevant communities and stakeholders;

(ii) - using the feedback obtained through those opportunities to inform the advice of the working group to the Board; and

(iii) - providing a mechanism for direct and substantial community feedback relating to the investment plan and the funding decisions of the C2FC.

(B) Public awareness - Each working group shall inform the public about C2FC investment by engaging in public awareness campaigns, which shall target relevant communities through comprehensive and accessible outreach methods suited for the relevant community.

(C) Broad participation - In carrying out subparagraph (A), each working group shall, to the maximum extent practicable, maximize participation from a broad group of stakeholders, including by holding multiple meetings with significant advance notice, providing access to remote participation in those meetings, and holding meetings in multiple languages and at different times and locations.

(5) Tasks - Each working group shall, as it relates to the subject matter of the working group—

(A) - advise and provide general input to the Board regarding loans and grants provided by the C2FC; and

(B) - consult with, and based on the activities described in paragraph (4), provide recommendations to, the Board in the development of and updates to the investment plan of the C2FC.

(d) Investment plan

(1) In general - The Board, in consultation with each working group described in subsection (c)(1), shall develop an investment plan (referred to in this subsection as the "investment plan") for the C2FC in accordance with this subsection.

(2) Purposes - The purposes of the investment plan are—

(A) - to ensure that investments made by the C2FC—

(i) - are equitable and reach the prioritized communities described in subsection (e)(2);

(ii) - are effective at progressing towards the goals described in subsection (a)(3)(C);

(iii) - support the advancement of research in clean technologies and resilience; and

(iv) - are transparent to the prioritized communities described in subsection (e)(2); and

(B) - to provide methods and standards by which the Board and the working groups described in subsection (c)(1) shall choose projects in which to invest.

(3) Distribution of grant funds - The initial investment plan shall require that, of the total amount of grant funds provided under subsection (e)(3)(A) each year, not less than 40 percent shall be used to invest in and benefit communities described in subsection (e)(2)(A).

(4) Investment plan updates

(A) In general - The Board, in consultation with each working group described in subsection (c)(1), shall update the investment plan not later than 1 year after the date of enactment of this Act, and every 4 years thereafter, including by taking into account—

(i) - the current needs of the prioritized communities described in subsection (e)(2);

(ii) - the effectiveness of the previous investment plan in addressing the needs of those communities;

(iii) - the current state of relevant research and technology;

(iv) - the resiliency needs of local communities;

(v) - the goals described in subsection (a)(3)(C); and

(vi) - the 2 most recent program reviews conducted under subsection (f).

(B) Effectiveness - An investment plan shall remain in effect until the date on which the Board approves an updated investment plan.

(C) Public input - In updating the investment plan, the Board and the working groups described in subsection (c)(1) shall—

(i) - engage stakeholders and the public in a public comment and feedback process; and

(ii) - ensure that the prioritized communities described in subsection (e)(2) have access to participate in that process.

(5) Public updates - The Board shall make publicly available on a quarterly basis information relating to the expenditure of funds under the investment plan.

(e) Investment tools

(1) Definitions - In this subsection:

(A) Community of color - The term community of color means a geographically distinct area in which the population of any of the following categories of individuals is higher than the average population of that category for the State in which the community is located:

(i) - Black.

(ii) - African American.

(iii) - Asian.

(iv) - Pacific Islander.

(v) - Other non-White race.

(vi) - Hispanic.

(vii) - Latino.

(viii) - Linguistically isolated.

(B) Eligible borrower - The term eligible borrower means any person, including a business owner or project developer, that seeks a loan to carry out approved practices or projects described in subparagraph (A)(i) of paragraph (3) from an eligible lender that may receive a loan guarantee under that paragraph for that loan, according to criteria determined by the C2FC.

(i) - a State;

(ii) - an Indian Tribe;

(iii) - a unit of local government; and

(iv) - a research and development institution (including a National Laboratory).

(D) Eligible lender - The term eligible lender means—

(i) - a Federal- or State-chartered bank;

(ii) - a Federal- or State-chartered credit union;

(iii) - an agricultural credit corporation;

(iv) - a United States Green Bank Institution;

(v) - a community development financial institution (as defined in section 103 of the Community Development Banking and Financial Institutions Act of 1994 (12 U.S.C. 4702));

(vi) - a minority depository institution (as defined in section 308(b) of the Financial Institutions Reform, Recovery, and Enforcement Act of 1989 (12 U.S.C. 1463 note; Public Law 101–73)); and

(vii) - any other lender that the Board determines has a demonstrated ability to underwrite and service loans for the intended approved practice for which the loan will be used.

(E) Environmental justice community - The term environmental justice community means a community with significant representation of communities of color, low-income communities, or Tribal and indigenous communities that experiences, or is at risk of experiencing, higher or more adverse human health or environmental effects.

(F) Indian tribe - The term Indian Tribe has the meaning given the term in section 4 of the Indian Self-Determination and Education Assistance Act (25 U.S.C. 5304).

(G) Low-income community - The term low-income community means any census block group in which 30 percent or more of the population are individuals with an annual household income equal to, or less than, the greater of—

(i) - an amount equal to 80 percent of the median income of the area in which the household is located, as reported by the Department of Housing and Urban Development; and

(ii) - 200 percent of the Federal poverty line.

(H) State - The term State means—

(i) - a State;

(ii) - the District of Columbia;

(iii) - the Commonwealth of Puerto Rico; and

(iv) - any other territory or possession of the United States.

(2) Community prioritization - In providing financial investment and other assistance under paragraph (3), the C2FC shall give priority to, as determined by the C2FC—

(A) - environmental justice communities, communities of color, indigenous communities, rural communities, and low-income communities that—

(i) - experience a disproportionate burden of the negative human health and environmental impacts of pollution or other environmental hazards, such as natural disasters; or

(ii) - may not have access to public information and opportunities for meaningful public participation relating to human health and environmental planning, regulations, and enforcement;

(B) - deindustrialized communities or communities with significant local economic reliance on carbon-intensive industries;

(D) - public or nonprofit entities that serve dislocated workers, veterans, or individuals with a barrier to employment; and

(E) - communities that have minimal or no investment in the approved practices and projects described in paragraph (3)(A)(i).

(3) Grants, loan guarantees, and other investment tools

(A) In general - The C2FC—

(i) - shall provide grants to eligible entities and loan guarantees to eligible lenders issuing loans to eligible borrowers for approved practices and projects relating to climate change mitigation and resilience measures, including—

(I) - energy efficiency upgrades to infrastructure;

(II) - electric, hydrogen, and clean transportation programs and deployment, including programs—

(aa) - to purchase personal vehicles, commercial vehicles, and public transportation fleets and school bus fleets;

(bb) - to deploy electric vehicle charging and hydrogen fueling infrastructure; and

(cc) - to develop and deploy sustainable aviation fuels;

(III) - clean energy and clean vehicle manufacturing research, demonstrations, and deployment, with a particular focus on projects relating to the commercialization of new technologies;

(IV) - battery storage research, demonstrations, and deployment;

(V) - development or purchase of equipment for practices described in section 6;

(VI) - development and deployment of clean energy and clean technologies, with a focus on—

(aa) - carbon capture, utilization, and sequestration, bioenergy with carbon capture and sequestration, and direct air capture;

(bb) - energy storage and grid modernization;

(cc) - geothermal energy;

(dd) - commercial and residential solar;

(ee) - wind energy; and

(ff) - any other clean technology use or development, as determined by the Board;

(VII) - measures that anticipate and prepare for climate change impacts, and reduce risks and enhance resilience to sea level rise, extreme weather events, heat island impacts, and other climate change impacts, as determined by the Board, including by—

(aa) - building resilient energy, water, and transportation infrastructure;

(bb) - providing weatherization assistance for low-income households; and

(cc) - increasing the physical and economic resilience of the agriculture sector; and

(VIII) - natural infrastructure research, demonstrations, and deployment; and

(ii) - may implement other investment tools and products approved by the Board, pursuant to subparagraph (C), to achieve the mission of the C2FC described in subsection (a)(2).

(B) Loan guarantees

(i) In general - In providing loan guarantees under subparagraph (A), the C2FC shall cooperate with eligible lenders through agreements to participate on a deferred (guaranteed) basis.

(ii) Level of participation in guaranteed loans - In providing a loan guarantee under subparagraph (A), the C2FC shall guarantee 75 percent of the balance of the financing outstanding at the time of disbursement of the loan.

(iii) Interest rates - Notwithstanding the provisions of the constitution of any State or the laws of any State limiting the rate or amount of interest that may be charged, taken, received, or reserved, the maximum legal rate of interest on any financing made on a deferred basis under this subsection shall not exceed a rate prescribed by the C2FC.

(iv) Guarantee fees

(I) In general - With respect to each loan guaranteed under this subsection (other than a loan that is repayable in 1 year or less), the C2FC shall collect a guarantee fee, which shall be payable by the eligible lender, and may be charged to the eligible borrower in accordance with subclause (II).

(II) Borrower charges - A guarantee fee described in subclause (I) charged to an eligible borrower shall not—

(aa) - exceed 2 percent of the deferred participation share of a total loan amount that is equal to or less than $150,000;

(bb) - exceed 3 percent of the deferred participation share of a total loan amount that is greater than $150,000 but less than $700,000; or

(cc) - exceed 3.5 percent of the deferred participation share of a total loan amount that is equal to or greater than $700,000.

(i) In general - The Board may, based on market needs, develop and implement any other investment tool or product necessary to achieve the mission of the C2FC described in subsection (a)(2) and the deployment of projects described in subparagraph (A)(i), including offering—

(I) - warehousing and aggregation credit facilities;

(II) - zero interest loans;

(III) - credit enhancements; and

(IV) - construction finance.

(ii) State and local green banks - The Board shall provide—

(I) - funds to United States Green Bank Institutions as necessary to finance projects that are best served by those entities; and

(II) - technical assistance as necessary to States and localities seeking to establish green banks.

(D) Prohibited investments - The Board shall not issue loans, grants, or otherwise invest in any activities that directly or indirectly contradict the mission of the C2FC described in subsection (a)(2).

(4) Wage rate requirements

(A) In general - All laborers and mechanics employed by eligible entities and eligible borrowers on projects funded directly by or assisted in whole or in part by the activities of the C2FC under this section shall be paid at wages at rates not less than those prevailing on projects of a similar character in the locality as determined by the Secretary of Labor in accordance with subchapter IV of chapter 31 of title 40, United States Code (commonly known as the "Davis-Bacon Act").

(B) Authority - With respect to the labor standards specified in subparagraph (A), the Secretary of Labor shall have the authority and functions set forth in Reorganization Plan No. 14 of 1950 (64 Stat. 1267; 5 U.S.C. App.) and section 3145 of title 40, United States Code.

(5) Buy america requirements

(A) In general - All iron, steel, and manufactured goods used for projects under this section shall be produced in the United States.

(B) Waiver - The Board may waive the requirement in subparagraph (A) if the Board finds that—

(i) - enforcing the requirement would be inconsistent with the public interest;

(ii) - the iron, steel, and manufactured goods produced in the United States are not produced in a sufficient and reasonably available amount or are not of a satisfactory quality; or

(iii) - enforcing the requirement will increase the overall cost of the project by more than 25 percent.

(f) Program review and report - Not later than 2 years after the date of enactment of this Act, and every 2 years thereafter, the Board shall—

(1) - conduct a review of the activities of the C2FC and identify projects and funding opportunities that were a part of the current investment plan; and

(2) - submit to Congress and make publicly available a report that—

(A) - describes the projects and funding opportunities that have been most successful in progressing towards the mission described in subsection (a)(2) during the time period covered by the report;

(B) - includes recommendations on the clean energy and resiliency projects that should be prioritized in forthcoming years to achieve that mission;

(C) - quantifies the total amount and percentage of funding given to prioritized communities described in subsection (e)(2); and

(D) - identifies barriers for disadvantaged groups to receive C2FC funding and provides recommendations to address those barriers.

(g) Initial capitalization - There is appropriated to carry out this section (including for administrative costs of the C2FC), out of any funds in the Treasury not otherwise appropriated, $7,500,000,000 for each of fiscal years 2026 and 2027, to remain available until expended.

3. Carbon fee

(a) In general - Chapter 38 of subtitle D of the Internal Revenue Code of 1986 is amended by adding at the end the following new subchapter:

(b) Effective date - The amendment made by this section shall apply to periods beginning after December 31, 2026.

4. America's Clean Future Fund

(a) In general - Subchapter A of chapter 98 of the Internal Revenue Code of 1986 is amended by adding at the end the following:

9512. America's Clean Future Fund

(a) Establishment and funding - There is established in the Treasury of the United States a trust fund to be known as the "America's Clean Future Fund" (referred to in this section as the "Trust Fund"), consisting of such amounts as are appropriated to the Trust Fund under subsection (b).

(b) Transfers to America's Clean Future Fund - There is appropriated to the Trust Fund, out of any funds in the Treasury not otherwise appropriated, amounts equal to the fees received into the Treasury under sections 4692, 4693, and 4695, less—

(1) - any amounts refunded or paid under sections 4692(d), 4694, and 4695(b), and

(2) - for each of the first 14 fiscal years beginning after September 30, 2027, an amount equal to the quotient of—

(A) - $100,000,000,000, and

(B) - 14.

(1) Carbon fee rebate and agricultural decarbonization transition payments

(A) Carbon fee rebate - For the purposes described in section 5 of the America's Clean Future Fund Act and any expenses necessary to administer such section—

(i) - for each of the first 10 fiscal years beginning after September 30, 2027, an amount equal to—

(I) - 75 percent of those amounts, minus

(II) - the amount determined under subparagraph (B) for such fiscal year, and

(ii) - for any fiscal year beginning after the period described in clause (i), the applicable percentage of such amounts.

(B) Agricultural decarbonization transition payments - For the purposes described in section 6 of the America's Clean Future Fund Act, for each of the first 10 fiscal years beginning after September 30, 2027, an amount equal to 7 percent of the amount determined annually under subparagraph (A)(i)(I).

(i) - for the first fiscal year beginning after the period described in subparagraph (A)(i), 76 percent,

(ii) - for each of the first 3 fiscal years subsequent to the period described in clause (i), the applicable percentage for the preceding fiscal year increased by 1 percentage point, and

(iii) - for any fiscal year subsequent to the period described in clause (ii), 80 percent.

(2) Climate Change Finance Corporation

(A) In general - For the purposes described in section 2 of the America's Clean Future Fund Act (including any expenses necessary to administer such section), the applicable percentage of such amounts.

(B) Applicable percentage - For purposes of this paragraph, the applicable percentage shall be equal to—

(i) - for each of the first 10 fiscal years beginning after the period described in subsection (e) of such section, 15 percent,

(ii) - for each of the first 4 fiscal years subsequent to the period described in clause (i), the applicable percentage for the preceding fiscal year increased by 1 percentage point, and

(iii) - for any fiscal year subsequent to the period described in clause (ii), 20 percent.

(3) Transition assistance for impacted communities

(A) In general - For the purposes described in section 7 of the America's Clean Future Fund Act (including any expenses necessary to administer such section), the applicable percentage of such amounts.

(B) Applicable percentage - For purposes of this paragraph, the applicable percentage shall be equal to—

(i) - for each of the first 10 fiscal years beginning after September 30, 2027, 10 percent,

(ii) - for each of the first 4 fiscal years subsequent to the period described in clause (i), the applicable percentage for the preceding fiscal year reduced by 2 percentage points, and

(iii) - for any fiscal year subsequent to the period described in clause (ii), 0 percent.

(b) Clerical amendment - The table of sections for subchapter A of chapter 98 of the Internal Revenue Code of 1986 is amended by adding at the end the following new item:

5. America's Clean Future Fund Stimulus

(a) Eligible individual

(1) In general - In this section, the term eligible individual means, with respect to any quarter, any natural living person—

(A) - who has a valid Social Security number or taxpayer identification number,

(B) - who has attained 18 years of age, and

(C) - whose principal place of abode is in the United States for more than one-half of the most recent taxable year for which a return has been filed.

(2) Verification - The Secretary of the Treasury, or the Secretary's delegate (referred to in this section as the "Secretary") may verify the eligibility of an individual to receive a carbon fee rebate payment under subsection (b).

(b) Rebates - Subject to subsections (c)(2) and (k), from amounts in the America's Clean Future Fund established by section 9512(c)(1)(A) of the Internal Revenue Code of 1986 that are available in any year, the Secretary shall, for each calendar quarter beginning after September 30, 2027, make carbon fee rebate payments to each eligible individual, to be known as "America's Clean Future Fund Stimulus payments" (referred to in this section as "carbon fee rebate payments").

(1) In general - With respect to each quarter during any fiscal year beginning after September 30, 2027, the carbon fee rebate payment is 1 pro-rata share for each eligible individual of an amount equal to 25 percent of amounts apportioned under section 9512(c)(1)(A) of the Internal Revenue Code of 1986 for such fiscal year.

(2) Initial annual rebate payments

(A) In general - From amounts appropriated under subsection (j), the Secretary shall, for each of fiscal years 2026 and 2027, make carbon fee rebate payments to each eligible individual during the third quarter of each such fiscal year.

(B) Pro-rata share - For purposes of this paragraph, the carbon fee rebate payment is 1 pro-rata share for each eligible individual of the amount appropriated under subsection (j) for the fiscal year.

(3) Estimate - For each fiscal year described in paragraph (1), the Secretary shall, not later than the first day of such fiscal year, publicly announce an estimate of the amount of the carbon fee rebate payment for each quarter during such fiscal year.

(d) Phaseout

(1) Definitions - In this subsection:

(A) Modified adjusted gross income - The term modified adjusted gross income means adjusted gross income increased by any amount excluded from gross income under section 911, 931, or 933 of the Internal Revenue Code of 1986.

(B) Household member - The term household member of the taxpayer means the taxpayer, the taxpayer's spouse, and any dependent of the taxpayer.

(i) - $150,000 in the case of a taxpayer filing a joint return, and

(ii) - $75,000 in the case of a taxpayer not filing a joint return.

(2) Phaseout of payments - In the case of any taxpayer whose modified adjusted gross income for the most recent taxable year for which a return has been filed exceeds the threshold amount, the amount of the carbon fee rebate payment otherwise payable to any household member of the taxpayer under this section shall be reduced (but not below zero) by a dollar amount equal to 5 percent of such payment (as determined before application of this paragraph) for each $1,000 (or fraction thereof) by which the modified adjusted gross income of the taxpayer exceeds the threshold amount.

(e) Fee treatment of payments - Amounts paid under this section shall not be includible in gross income for purposes of Federal income taxes.

(f) Federal programs and Federal assisted programs - The carbon fee rebate payment received by any eligible individual shall not be taken into account as income and shall not be taken into account as resources for purposes of determining the eligibility of such individual or any other individual for benefits or assistance, or the amount or extent of benefits or assistance, under any Federal program or under any State or local program financed in whole or in part with Federal funds.

(g) Disclosure of return information - Section 6103(l) of the Internal Revenue Code of 1986 is amended by adding at the end the following new paragraph:

(23) Disclosure of return information relating to carbon fee rebate payments

(A) Department of Treasury - Return information with respect to any taxpayer shall, without written request, be open to inspection by or disclosure to officers and employees of the Department of the Treasury whose official duties require such inspection or disclosure for purposes of administering section 5 of the America's Clean Future Fund Act.

(B) Restriction on disclosure - Information disclosed under this paragraph shall be disclosed only for purposes of, and to the extent necessary in, carrying out such section.

(h) Regulations - The Secretary shall prescribe such regulations, and other guidance, as may be necessary to carry out the purposes of this section, including—

(1) - establishment of rules for eligible individuals who have not filed a recent tax return, and

(2) - in coordination with the Commissioner of Social Security, the Secretary of Veterans Affairs, and any relevant State agencies, establish methods to identify eligible individuals and provide carbon fee rebate payments to such individuals through appropriate means of distribution, including through the use of electronic benefit transfer cards.

(i) Public awareness campaign - The Secretary shall conduct a public awareness campaign, in coordination with the Commissioner of Social Security, the heads of other relevant Federal agencies, and Indian Tribes (as defined in section 4 of the Indian Self-Determination and Education Assistance Act (25 U.S.C. 5304)), to provide information to the public regarding the availability of carbon fee rebate payments under this section.

(j) Initial appropriation - For purposes of subsection (c)(2), there is appropriated, out of any funds in the Treasury not otherwise appropriated, to remain available until expended—

(1) - for the fiscal year ending September 30, 2026, $37,500,000,000, and

(2) - for the fiscal year ending September 30, 2027, $37,500,000,000.

(k) Termination - This section shall not apply to any calendar quarter beginning after—

(1) - a determination by the Secretary under section 4692(d)(3)(B) of the Internal Revenue Code of 1986; or

(2) - any period of 8 consecutive calendar quarters for which the amount of carbon fee rebate payment (without application of subsection (d)) during each such quarter is less than $20.

6. Agricultural decarbonization transition payments

(a) Purposes - The purposes of this section are—

(1) - to provide transition assistance to eligible producers in the agricultural sector to prepare for and facilitate entry into greenhouse gas credit markets; and

(2) - to provide for the collection and reporting of data under subsection (d).

(b) Definitions - In this section:

(1) Eligible land - The term eligible land means land in the United States, including territories of the United States and Indian land (as defined in section 2601 of the Energy Policy Act of 1992 (25 U.S.C. 3501)), that has a cropping or livestock history during each of the 3 years preceding the date on which a payment is provided under the program with respect to the land, as determined by the Secretary.

(2) Eligible producer - The term eligible producer means an individual or legal entity that—

(A) - is an owner, operator, or tenant of eligible land; and

(B) - has the ability to enter into an agreement with the Secretary to carry out qualifying actions described in subsection (c)(2) under the program.

(3) Greenhouse gas emissions reduction - The term greenhouse gas emissions reduction means the reduction in greenhouse gas emissions as a result of the adoption of qualifying actions described in subsection (c)(2), as compared to an historical baseline.

(4) Program - The term program means the program established under subsection (c)(1).

(5) Secretary - The term Secretary means the Secretary of Agriculture.

(6) Traditionally underserved - The term traditionally underserved, with respect to an eligible producer, means that the eligible producer—

(A) - has been socially or economically disadvantaged by previous discriminatory laws or policies based on race, ethnicity, or disability;

(B) - is new to agriculture, as determined by the Secretary;

(C)

(i) - has served in the United States Armed Forces; and

(ii)

(I) - has not operated an agriculture operation;

(II) - is new to agriculture, as determined by the Secretary; or

(III) - first obtained veteran status during the previous 5-year period;

(D) - is an owner, operator, or tenant of a limited resource agriculture operation; or

(E) - has a household income not greater than the national poverty level.

(1) In general - The Secretary shall establish a program to provide payments to eligible producers that will assist with reducing greenhouse gas emissions through the adoption of qualifying actions described in paragraph (2).

(2) Qualifying actions

(A) In general - The Secretary shall determine actions that qualify for payments under the program.

(B) Requirements - To be a qualifying action under subparagraph (A), an action shall be—

(i) - a climate-smart practice, including—

(I) - a practice determined by a land-grant college or university (as defined in section 1404 of the National Agricultural Research, Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3103)); or

(II) - climate-smart energy generation, fueling, or efficiency; and

(ii) - measurable, reportable, and verifiable for reducing greenhouse gas emissions, as determined by the Secretary.

(3) Considerations - In determining the rate and duration of a payment under paragraph (1), the Secretary shall consider—

(A) - the degree of additionality of the greenhouse gas emissions reduction;

(B) - whether the recipient of the payment was an early adopter of 1 or more practices that reduce greenhouse gas emissions;

(C) - the likelihood that the applicable qualifying action described in paragraph (2) would have been carried out absent the provision of the payment;

(D) - the degree of transitionality or permanence of the greenhouse gas emissions reduction;

(E) - whether the applicable qualifying action described in paragraph (2) provides multiple environmental and health co-benefits in addition to reduced greenhouse gas emissions;

(F) - the degree to which the recipient of the payment is a traditionally underserved eligible producer;

(G) - the integration with and enhancement of payments and policies of similar Federal, State, or local programs; and

(H) - any payments received, or to be received, by the applicable eligible producer from a similar Federal, State, or local program for applicable qualifying actions described in paragraph (2).

(4) Ineligibility - A person that is determined to be in violation of any applicable water or air quality regulation, including under the Federal Water Pollution Control Act (33 U.S.C. 1251 et seq.) (including regulations), shall not be eligible for any payment under paragraph (1) during the period of the violation.

(5) Effectiveness - The authority to provide payments under this subsection shall be effective for each of the first 10 fiscal years beginning after September 30, 2026.

(d) Collection of data and reporting

(1) Measurement system - The Secretary shall use an outcomes-based measurement system that uses the best available science and technology for cost-effective recordkeeping, modeling, and measurement of farm-level greenhouse gas emissions on eligible land enrolled in the program.

(2) Inventory

(A) In general - For the purposes of providing payments under the program, the Secretary shall conduct a nationwide soil health and agricultural greenhouse gas emissions inventory that uses the best available science and data to establish baselines and expected average performance for soil carbon drawdown and storage and greenhouse gas emissions reduction by primary production type and production region.

(B) Database - The Secretary shall—

(i) - establish an accessible and interoperable database for the inventory established under subparagraph (A) using the measurement system established under paragraph (1); and

(ii) - improve and update the database as new data is collected, but not less frequently than once every 2 years.

(3) Criteria

(A) In general - The Secretary shall establish criteria for payments under the program to inform policy and markets established to promote greenhouse gas emissions reductions.

(B) Requirements - The criteria established under subparagraph (A) shall—

(i) - have a documented likelihood of providing long-term net greenhouse gas emissions reductions, according to the best available science;

(ii) - be based in part on environmental impact modeling of the changes of shifting from baseline practices to new or improved practices; and

(iii) - prevent, to the maximum extent practicable, the degradation of other natural resource or environmental conditions.

(4) Measurement, reporting, monitoring, and verification services

(A) In general - The Secretary—

(i) - shall provide services described in subparagraph (B) to eligible producers participating in the program; and

(ii) - may approve and provide oversight of 1 or more third-party agents to provide services described in subparagraph (B) to eligible producers participating in the program.

(B) Services described - Services referred to in subparagraph (A) are determining the greenhouse gas emissions reduction by—

(i) - measurement;

(ii) - reporting;

(iii) - monitoring; and

(iv) - verification.

(i) - the measurement system described in paragraph (1); and

(ii) - the criteria described in paragraph (3).

(D) Privacy and data security

(i) In general - The Secretary shall establish—

(I) - safeguards to protect the privacy of information that is submitted through or retained by a third-party agent approved under subparagraph (A), including employees and contractors of the third-party agent; and

(II) - such other rules and standards of data security as the Secretary determines to be appropriate to carry out this subsection.

(ii) Penalties - The Secretary shall establish penalties for any violations of privacy or confidentiality under clause (i).

(E) Disclosure of information

(i) Public disclosure - Information collected for purposes of services provided under subparagraph (A) may be disclosed to the public—

(I) - if the information is transformed into a statistical or aggregate form such that the information does not include any identifiable or personal information of individual producers; or

(II) - in a form that may include identifiable or personal information of a producer only if that producer consents to the disclosure of the information.

(ii) Research, audit, and program improvement - Information collected for the purposes of services provided under subparagraph (A) may be disclosed for the purposes of providing technical assistance, including audit, research, or improvement of a program under this section, either in aggregate or in a form that includes identifiable or personal information of a producer, if the Secretary obtains adequate assurances that—

(I) - the recipient shall ensure privacy safeguards of identifiable or personal information of a producer; and

(II) - the release of any data to the public will only occur only if the data has been transformed into a statistical or aggregate form.

(e) Regulations - Not later than July 1, 2026, the Secretary shall promulgate regulations to carry out this section, including—

(1) - the amount of a payment under subsection (c), which shall be based on—

(A) - the quantity of CO-e reduced; and

(B) - the considerations described in subsection (c)(3);

(2) - a methodology that any third-party agents approved under subsection (d)(4)(A)(ii) shall use to provide the services under that subsection, including—

(A) - an accreditation process; and

(B) - a conflict of interest policy; and

(3) - provisions for the ownership and transportability of data, including historical data, generated by an eligible producer for the purpose of determining eligibility for payments under the program.

7. Transition assistance for impacted communities

(a) Definitions - In this section:

(1) Indian tribe - The term Indian Tribe has the meaning given the term in section 4 of the Indian Self-Determination and Education Assistance Act (25 U.S.C. 5304).

(2) Individual with a barrier to employment - The term individual with a barrier to employment has the meaning given the term in section 3 of the Workforce Innovation and Opportunity Act (29 U.S.C. 3102).

(3) Institution of higher education - The term institution of higher education has the meaning given the term in section 101 of the Higher Education Act of 1965 (20 U.S.C. 1001).

(4) Local board - The term local board has the meaning given the term in section 3 of the Workforce Innovation and Opportunity Act (29 U.S.C. 3102).

(5) Recognized postsecondary credential - The term recognized postsecondary credential has the meaning given the term in section 3 of the Workforce Innovation and Opportunity Act (29 U.S.C. 3102).

(6) Secretary - The term Secretary means the Secretary of Commerce, acting through the Assistant Secretary of Commerce for Economic Development.

(7) State - The term State means—

(A) - a State;

(B) - the District of Columbia;

(D) - any other territory or possession of the United States.

(8) State board - The term State board has the meaning given the term in section 3 of the Workforce Innovation and Opportunity Act (29 U.S.C. 3102).

(9) Supportive services - The term supportive services has the meaning given the term in section 3 of the Workforce Innovation and Opportunity Act (29 U.S.C. 3102).

(b) Grants - The Secretary, in coordination with the Secretary of Labor, shall provide grants to eligible entities to assist in the transition to a low- or zero-greenhouse gas emitting economy.

(c) Eligible entities - An entity eligible to receive a grant under this section is a labor organization, an institution of higher education, a unit of State or local government, an Indian Tribe, an economic development organization, a nonprofit organization, community-based organization, or intermediary, or a State board or local board that serves or is located in a community that—

(1) - as determined by the Secretary, in coordination with the Secretary of Labor, has been or will be impacted by economic changes in carbon-intensive industries, including in an energy community (as defined in section 45(b)(11) of the Internal Revenue Code of 1986);

(2) - as determined by the Secretary, in consultation with the Administrator of the Federal Emergency Management Agency, has been or is at risk of being impacted by extreme weather events, sea level rise, and natural disasters related to climate change; or

(3) - as determined by the Secretary, in consultation with the Administrator of the Environmental Protection Agency, has been impacted by harmful residuals from a fossil fuel or carbon-intensive industry.

(d) Use of funds - An eligible entity that receives a grant under this section shall use the grant for—

(1) - economic and workforce development activities, such as—

(A) - job creation;

(B) - providing reemployment and worker transition assistance, including registered apprenticeships, subsidized employment, job training, transitional jobs, and supportive services, with priority given to—

(i) - workers impacted by changes in carbon-intensive industries;

(ii) - individuals with a barrier to employment; and

(iii) - programs that lead to a recognized postsecondary credential;

(D) - export promotion; and

(E) - establishment of a monthly subsidy payment for workers who retire early due to economic changes in carbon-intensive industries;

(2) - climate change resiliency, such as—

(A) - building electrical, communications, utility, transportation, and other infrastructure in flood-prone areas above flood zone levels;

(B) - building flood and stormproofing measures in flood-prone areas and erosion-prone areas;

(C) - increasing the resilience of a surface transportation infrastructure asset to withstand extreme weather events and climate change impacts;

(D) - improving stormwater infrastructure;

(E) - increasing the resilience of agriculture to extreme weather;

(F) - ecological restoration;

(G) - increasing the resilience of forests to wildfires;

(H) - increasing coastal resilience; and

(I) - implementing heat island cooling strategies;

(3) - environmental remediation and restoration projects of fossil fuel industry facilities that are abandoned or retired, or closed due to bankruptcy, and residuals from carbon-intensive industries, such as—

(A) - coal ash and petroleum coke cleanup;

(B) - mine reclamation;

(D) - remediation of impaired waterways and drinking water resources; or

(4) - other activities as the Secretary, in coordination with the Secretary of Labor, the Administrator of the Federal Emergency Management Agency, and the Administrator of the Environmental Protection Agency, determines to be appropriate.

(e) Requirements

(1) Labor standards; nondiscrimination - An eligible entity that receives a grant under this section shall use the funds in a manner consistent with sections 181 and 188 of the Workforce Innovation and Opportunity Act (29 U.S.C. 3241, 3248).

(2) Wage rate requirements

(A) In general - All laborers and mechanics employed by eligible entities to carry out projects and activities funded directly by or assisted in whole or in part by a grant under this section shall be paid at wages at rates not less than those prevailing on projects of a similar character in the locality as determined by the Secretary of Labor in accordance with subchapter IV of chapter 31 of title 40, United States Code (commonly known as the "Davis-Bacon Act").

(3) Buy America requirements

(A) In general - All iron, steel, and manufactured goods used for projects and activities carried out with a grant under this section shall be produced in the United States.

(B) Waiver - The Secretary may waive the requirement in subparagraph (A) if the Secretary finds that—

(i) - enforcing the requirement would be inconsistent with the public interest;

(ii) - the iron, steel, and manufactured goods produced in the United States are not produced in a sufficient and reasonably available amount or are not of a satisfactory quality; or

(iii) - enforcing the requirement will increase the overall cost of the project or activity by more than 25 percent.

(f) Coordination - An eligible entity that receives a grant under this section is encouraged to collaborate or partner with other eligible entities and impacted communities in planning and carrying out activities with that grant.

(g) Report - Not later than 3 years after the date on which the Secretary establishes the grant program under this section, the Secretary and the Secretary of Labor shall submit to Congress a report on the effectiveness of the grant program, including—

(1) - the number of individuals that have received reemployment or worker transition assistance under this section;

(2) - a description of any job creation activities carried out with a grant under this section and the number of jobs created from those activities;

(3) - the percentage of individuals that have received reemployment or worker transition assistance under this section who are, during the second and fourth quarters after exiting the program—

(A) - in education or training activities; or

(B) - employed;

(4) - the average wages of individuals that have received reemployment or worker transition assistance under this section during the second and fourth quarters after exit from the program;

(5) - a description of any regional investment activities carried out with a grant under this section;

(6) - a description of any export promotion activities carried out with a grant under this section, including—

(A) - a description of the products promoted; and

(B) - an analysis of any increase in exports as a result of the promotion;

(7) - a description of any resilience activities carried out with a grant under this section;

(8) - a description of any cleanup activities from fossil fuel industry facilities or carbon-intensive industries carried out with a grant under this section; and

(9) - the distribution of funding among geographic and socioeconomic groups, including urban and rural communities, low-income communities, communities of color, and Indian Tribes.

(h) Funding

(1) Initial funding - There is appropriated to the Secretary, out of any funds in the Treasury not otherwise appropriated, $5,000,000,000 for each of fiscal years 2026 and 2027 to carry out this section, to remain available until expended.

(2) America's Clean Future Fund - The Secretary shall carry out this section using amounts made available from the America's Clean Future Fund under section 9512 of the Internal Revenue Code of 1986 (as added by section 4).

8. Study on carbon pricing

(a) In general - Not later than January 1, 2029, the Administrator of the Environmental Protection Agency (referred to in this section as the "Administrator") shall seek to enter into an agreement with the National Academy of Sciences under which the National Academy of Sciences shall carry out a study not less frequently than once every 5 years to evaluate the effectiveness of the fees established under sections 4692 and 4693 of the Internal Revenue Code of 1986 in achieving the following goals:

(1) - A net reduction of greenhouse gas emissions by 45 percent, based on 2018 levels, by 2030.

(2) - A net reduction of greenhouse gas emissions by 100 percent, based on 2018 levels, by 2050.

(b) Requirements - In executing the agreement under subsection (a), the Administrator shall ensure that, in carrying out a study under that subsection, the National Academy of Sciences—

(1) - includes an evaluation of—

(A) - total annual greenhouse gas emissions by the United States, including greenhouse gas emissions not subject to the fees described in that subsection;

(B) - the historic trends in the total greenhouse gas emissions evaluated under subparagraph (A); and

(C) - the impacts of the fees established under sections 4692 and 4693 of the Internal Revenue Code of 1986 on changes in the levels of fossil fuel-related localized air pollutants in environmental justice communities (as defined in section 2(e)(1));

(2) - analyzes the extent to which greenhouse gas emissions have been or would be reduced as a result of current and potential future policies, including—

(A) - a projection of greenhouse gas emissions reductions that would result if the regulations of the Administrator were to be adjusted to impose stricter limits on greenhouse gas emissions than the goals described in that subsection, with a particular focus on greenhouse gas emissions not subject to the fees described in that subsection;

(B) - the status of greenhouse gas emissions reductions that result from the fees established under sections 4692 and 4693 of the Internal Revenue Code of 1986;

(C) - a projection of greenhouse gas emissions reductions that would result if the fees established under those sections were annually increased—

(i) - at the current price path; and

(ii) - above the current price path;

(D) - an analysis of greenhouse gas emissions reductions that result from the policies of States, units of local government, Tribal communities, and the private sector; and

(E) - the status and projections of decarbonization in other major economies; and

(3) - submits a report to the Administrator, Congress, and the Board of Directors of the Climate Change Finance Corporation describing the results of the study.

9. Establishment of targets for carbon sequestration by land and water

(a) In general - The Chair of the Council on Environmental Quality, in consultation with the Secretaries of Agriculture, Commerce, and the Interior, the Chief of Engineers, and the Administrator of the Environmental Protection Agency, shall—

(1) - establish a target for carbon sequestration that can reasonably be achieved through enhancing the ability of public and private land and water to function as natural carbon sinks;

(2) - develop strategies for meeting that target; and

(3) - develop strategies to expand protections for ecosystems that sequester carbon and provide resiliency benefits, such as—

(A) - flood protection;

(B) - soil and beach retention;

(D) - biodiversity;

(E) - water purification; and

(F) - nutrient cycling.

(b) Report - As soon as practicable after the date of enactment of this Act, the Chair of the Council on Environmental Quality shall submit to Congress a report describing—

(1) - the target and strategies described in paragraphs (1) through (3) of subsection (a); and

(2) - any additional statutory authorities or authorized funding levels needed to successfully implement those strategies.

119-S2712

America's Clean Future Fund Act