Sec. 4. Establishment of the Climate Action Rebate Fund

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Subchapter A of chapter 98 of the Internal Revenue Code of 1986 is amended by adding at the end the following: There is hereby established in the Treasury of the United States a trust fund to be known as the Climate Action Rebate Fund , consisting of such amounts as may be appropriated to such trust fund as provided for in this section. There is hereby appropriated to the Climate Action Rebate Fund amounts equal to the fees received into the Treasury less any amounts refunded or paid under sections 4692(d) and 4695 for each month.

Amounts in the trust fund shall be available for the following purposes: So much of the expenses as are necessary to administer sections 4692 through 4695 for any year as does not to exceed 0.60 percent of the amounts appropriated to the Climate Action Rebate Fund for the previous year. So much of the expenses necessary to administer the Climate Action Rebate Fund for each year, as does not exceed— in the case of the first 5 fiscal years ending after the date of the enactment of this section, the administrative expenses for any year may not exceed 5 percent of amounts appropriated to the Climate Action Rebate Fund during such year, and in the case of any fiscal year thereafter, 1.5 percent of the 5-year rolling average of the amounts appropriated to the Climate Action Rebate Fund.

For each fiscal year, the amounts remaining in the Climate Action Rebate Fund following payment of expenses under paragraphs

(1)and

(2)shall be apportioned as follows: 70 percent of such amounts for the purposes described in subsection (d), 20 percent of such amounts for the purposes described in subsection (e), 5 percent of such amounts for the purposes described in subsection (f), and 5 percent of such amounts for the purposes described in subsection (g). From the amounts in the Carbon Dividend Trust Fund made available under subsection (c)(3)(A)(i) for any year, the Secretary shall, for each month beginning more than 270 days after the date of the enactment of the Climate Action Rebate Act of 2019 , make carbon dividend payments to each eligible individual. A carbon dividend payment is one pro-rata share for each adult and half a pro-rata share for each child under 19 years old of amounts available for the month in the Climate Action Rebate Fund. The term eligible individual means, with respect to any month, any natural living person who has a valid Social Security number or taxpayer identification number and is a citizen or lawful resident of the United States. The Secretary is authorized to verify an individual’s eligibility to receive a carbon dividend payment. 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 dividend otherwise payable to any household member of the taxpayer under this subsection shall be reduced (but not below zero) by a dollar amount equal to 5 percent of such dividend (as determined before application of this paragraph) for each $1,000 (or fraction thereof) by which such taxpayer's modified adjusted gross income exceeds the threshold amount. For purposes of this paragraph— The term modified adjusted gross income means adjusted gross income increased by any amount excluded from gross income under section 911, 931, or 933. The term household member of the taxpayer means the taxpayer, the taxpayer's spouse, and any dependent of the taxpayer. The term threshold amount means— $130,000 in the case of a joint return, $80,000 in the case of an individual who is not married, and $65,000 in the case of a married individual filing a separate return. The Secretary shall prescribe such regulations, and other guidance, as may be necessary to carry out the purposes of this paragraph, including establishment of rules for eligible individuals who have not filed a recent tax return. Amounts paid under this subsection shall be includible in gross income. The carbon dividend amount 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. The Secretary shall transfer to the Climate Action Rebate Fund such amounts as are necessary for the disbursement of an advanced carbon dividend to all eligible individuals as follows: An advanced carbon dividend shall be the same as the anticipated first carbon dividend required to be distributed under paragraph

(1)and shall be distributed the month prior to the first collection of the carbon fee. Total amounts disbursed as advanced carbon dividends shall be deducted from the carbon dividends on a pro-rata basis over the first 3 years after the disbursement of the first carbon dividends. From the amounts in the Carbon Dividend Trust Fund made available under subsection (c)(3)(A)(ii) for any year, the Secretary shall transfer such amounts as follows: 50 percent to the Highway Trust Fund under section 9503, with— 80 percent of such amount allocated to the Highway Account for the payment of obligations incurred in carrying out Federal-aid highway and highway safety construction programs authorized under title 23, United States Code, and 20 percent of such amount allocated to the Mass Transit Account for the payment of obligations incurred in carrying out transit programs authorized under— chapter 53 of title 49, United States Code, section 20005(b) of the Federal Public Transportation Act of 2012 ( 49 U.S.C. 5303 note; Public Law 112–141 ), and section 3006(b) of the Federal Public Transportation Act of 2015 ( 49 U.S.C. 5310 note; Public Law 114–94 ). 2.5 percent to the Department of Transportation for national infrastructure investments for innovative multimodal projects (also known as the Better Utilizing Investments to Leverage Development (BUILD) Transportation discretionary grant program). 2.5 percent to the Department of Transportation to make grants to the National Railroad Passenger Corporation for intercity passenger rail infrastructure, as authorized by section 11101 of the Passenger Rail Reform and Investment Act of 2015 (title XI of division A of Public Law 114–94 ) and sections 22907 and 24911 of title 49, United States Code. 5 percent to the Airport and Airway Trust Fund under section 9502 for the payment of obligations incurred in carrying out aviation programs authorized under subtitle VII of title 49, United States Code. 2.5 percent to the Department of Transportation to support deployment of alternative fuel vehicles, including electric vehicle charging stations and hydrogen fueling infrastructure. 5 percent to the Environmental Protection Agency for drinking water infrastructure programs under the Safe Drinking Water Act ( 42 U.S.C. 300f et seq.) and wastewater and clean water infrastructure programs under the Federal Water Pollution Control Act ( 33 U.S.C. 1251 et seq.). 2.5 percent to the Secretary of Agriculture for rural water or wastewater grants or direct or guaranteed loans under the Consolidated Farm and Rural Development Act ( 7 U.S.C. 1921 et seq.). 1.5 percent to the Federal Communications Commission to expand broadband access in rural areas. 5 percent to the Army Corps of Engineers for water resources development projects. 2.5 percent for the Community Development Block Grant program under title I of the Housing and Community Development Act of 1974 ( 42 U.S.C. 5401 et seq.) to assist States, units of general local government, and Indian tribes, as those terms are defined in section 101 of such Act ( 42 U.S.C. 5301 ), with planning and implementation of projects to support lowering emissions, and climate impact adaptation, including improving infrastructure resilience, increasing transit and housing density, and local economic development. 2.5 percent to the National Oceanic and Atmospheric Administration for coastal resiliency programs and ocean observing and monitoring programs. 2.5 percent to the Department of the Interior for maintenance and infrastructure upgrades on public land. 1.5 percent to the Hazardous Substance Superfund established under section 9507. 1.5 percent to the Abandoned Mine Reclamation Fund created by section 401 of the Surface Mining Control and Reclamation Act of 1977 ( 30 U.S.C. 1231 ). Notwithstanding subsection (b)(2) of section 303 of Public Law 96–451 ( 16 U.S.C. 1606a ), 1.5 percent to the Reforestation Trust Fund established by subsection

(a)of that section. 2.5 percent to the Department of Energy for energy efficiency programs, including— the Weatherization Assistance Program for Low-Income Persons established under part A of title IV of the Energy Conservation and Production Act ( 42 U.S.C. 6861 et seq.), State energy programs, the Clean Cities program, support for efficiency upgrades, including energy savings performance contracting, in Federal buildings, and the creation and initial funding of an Energy Efficiency State Revolving Fund, to be modeled after— State water pollution control revolving funds established under title VI of the Federal Water Pollution Control Act ( 33 U.S.C. 1381 et seq.), and State drinking water treatment revolving loan funds established under section 1452 of the Safe Drinking Water Act ( 42 U.S.C. 300j–12 ). 2.5 percent to the Secretary of Health and Human Services for a new program within the partnerships for State and regional hospital preparedness program under section 319C–2 of the Public Health Service Act ( 42 U.S.C. 247d–3b ) to fund infrastructure and facility improvements that support the climate resiliency and preparedness of hospitals and community health centers, including priority support for critical access hospitals (as defined in section 1861(mm)(1) of the Social Security Act ( 42 U.S.C. 1395x(mm)(1) ), safety net hospitals (as defined by the Center for Medicare and Medicaid Innovation), and community health centers in places experiencing heavy air pollution. 2.5 percent to the Secretary of Veterans Affairs to support resiliency and preparedness for Department of Veterans Affairs medical facilities. 1.5 percent to the Secretary of Agriculture for— energy programs under title IX of the Farm Security and Rural Investment Act of 2002 ( 7 U.S.C. 8101 et seq.), and watershed and flood prevention operations under the Watershed Protection and Flood Prevention Act ( 16 U.S.C. 1001 et seq.) and the Act of December 22, 1944 (commonly known as the Flood Control Act of 1944 ) (58 Stat. 887, chapter 665; 33 U.S.C. 701–1 et seq.). 2.5 percent to the Secretary of Agriculture for the program established under section 3(b) of the Climate Action Rebate Act of 2019 . From the amounts in the Carbon Dividend Trust Fund made available under subsection (c)(3)(A)(iii) for any year, the Secretary shall transfer such amounts to the Secretary of Energy to carry out the purposes described in paragraph (2). The Secretary of Energy shall use the funds transferred under paragraph

(1)to support high-impact research, development, demonstration, technology transfer, and commercialization of technologies that reduce or eliminate greenhouse gas emissions, including— energy storage technologies, including grid integration of storage, carbon capture, utilization, and sequestration, including direct air capture, next-generation nuclear technologies, energy efficiency, including in buildings and the industrial sector, electric grid modernization, sustainable transportation, including hydrogen fuel cell and electric vehicles, and the direct air capture program established under section 3(c) of the Climate Action Rebate Act of 2019 . In carrying out paragraph (2), the Secretary of Energy shall include support for offices under the Department of Energy and programs that support commercialization and innovative collaboration, including Advanced Research Projects Agency-Energy, the Loan Programs Office, energy innovation hubs, energy frontier research centers, regionally centered innovation programs, and the Manufacturing USA network. The Secretary of Energy shall collaborate with other appropriate agencies, including by sharing the funds transferred under paragraph (1), to support overlapping areas of innovation, including— biomass and bioenergy with the Department of Agriculture, nature-based solutions for carbon sequestration with the Departments of Agriculture, Commerce, and the Interior, export of technologies that will help other countries reduce or eliminate greenhouse gas emissions with the Departments of Commerce and State, and other such collaborations as determined necessary by the Secretary of Energy to achieve the goals outlined in paragraph (2). From the amounts in the Carbon Dividend Trust Fund made available under subsection (c)(3)(A)(iv) for any year, the Secretary shall transfer such amounts as follows: 40 percent to the Department of Labor for the establishment and initial funding of a program, to be modeled after the trade adjustment assistance for workers program under chapter 2 of title II of the Trade Act of 1974 ( 19 U.S.C. 2271 et seq.), to assist workers in industries that may be displaced as a result of the fees imposed under sections 4692 and 4694, including assistance with respect to— wage insurance, relocation expenses, early retirement, pension and health benefits, including (if applicable) the 1974 UMWA Pension Plan (as defined in section 9701(a)(3)), worker retraining, and other assistance that the Secretary of Labor determines appropriate. 20 percent to the Department of Energy to make grants to States, territories, and tribes in order to assist communities facing significantly increased energy costs as a result of the fees imposed under sections 4692 and 4694, in particular rural and low-income communities. 10 percent to the Department of Health and Human Services for the low-income home energy assistance program established under the Low-Income Home Energy Assistance Act of 1981 ( 42 U.S.C. 8621 et seq.). 30 percent to the Economic Development Administration for programs that support economic development and diversity in communities and areas dependent on industries that may be affected by the fees imposed under sections 4692 and 4694, including— the Economic Adjustment Assistance Program, and Partnerships for Opportunity and Workforce and Economic Revitalization. All uses of funding transferred under subsection

(e)through

(g)shall be in accordance with practices that protect American manufacturing, pay prevailing wages and benefits, and further reduce emissions when possible. None of the funds made available by this section may be used for a project for the construction, alteration, maintenance, or repair of a public building or public work unless all of the iron, steel, cement, and manufactured goods used in the project are produced in the United States. Subparagraph

(A)shall not apply in any case or category of cases in which the head of the Federal department or agency involved finds that— applying subparagraph

(A)would be inconsistent with the public interest, iron, steel, cement, and the relevant manufactured goods are not produced in the United States in sufficient and reasonably available quantities and of a satisfactory quality, or inclusion of iron, steel, cement, and manufactured goods produced in the United States will increase the cost of the overall project by more than 25 percent. If the head of a Federal department or agency determines that it is necessary to waive the application of subparagraph

(A)based on a finding under subparagraph (B), the head of the department or agency shall publish in the Federal Register a detailed written justification as to why the provision is being waived. This section shall be applied in a manner consistent with United States obligations under international agreements. Notwithstanding any other provision of law, all laborers and mechanics employed by contractors and subcontractors on projects funded directly by or assisted in whole or in part by the Climate Act Rebate Fund shall be paid 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. With respect to the labor standards specified in this paragraph, the Secretary of Labor shall have the authority and functions set forth in Reorganization Plan Numbered 14 of 1950 (64 Stat. 1267; 5 U.S.C. App.) and section 3145 of title 40, United States Code. For fiscal year 2020 and each fiscal year thereafter, the labor standards specified in paragraph

(3)shall apply to projects assisted in whole or in part with recycled funds, including principal repayments and interest earnings, made available by the Energy Efficiency State Revolving Fund established pursuant to subsection (e)(16)(E). Whenever possible, materials used for projects funded by this section shall be chosen with respect to minimizing their lifecycle emissions, as determined by the Administrator. Whenever possible, projects funded by subsection

(e)shall prioritize consideration of natural features and nature-based features, as defined in section 1184(a) of the Water Infrastructure Improvements for the Nation Act ( 33 U.S.C. 2289a(a) ). For any fiscal year beginning after the date on which the Secretary determines that— pursuant to section 4693, the emissions of greenhouse gases from covered fuels for the most recent calendar year is equal to or less than 10 percent of the greenhouse gas emissions from covered fuels for calendar year 2017; and the monthly carbon dividend payment made to an adult who is an eligible individual pursuant to subsection

(d)has been less than $20 for the preceding 3 calendar years, no amounts may be transferred from Climate Action Rebate Fund for any purpose described in subsection (c)(3), and any amounts remaining in the Climate Action Rebate Fund shall be transferred to the general fund of the Treasury of the United States. In the case of any year beginning after 2020, the dollar amount under paragraph (1)(B) shall be increased by an amount equal to— such dollar amount, multiplied by the cost-of-living adjustment determined under section 1(f)(3) for the calendar year in which the taxable year begins, determined by substituting calendar year 2017 for calendar year 2016 in subparagraph (A)(ii) thereof. The Secretary, in coordination with the heads of other relevant Federal agencies, shall promulgate rules, guidance, and regulations useful and necessary to implement the Climate Action Rebate Fund. . Section 9502(b)(1) of the Internal Revenue Code of 1986 is amended— by inserting and fees after the taxes , and by striking and at the end of subparagraph

(C)and by inserting after subparagraph

(D)the following new subparagraph: section 9512(e)(4) (relating to carbon fee), and . Section 9503(b)(1) of the Internal Revenue Code of 1986 is amended— by inserting and fees after equivalent to the taxes , and by striking and at the end of subparagraph (D), by striking the period at the end of subparagraph

(E)and inserting , and , and by inserting after subparagraph

(E)the following new subparagraph: section 9512(e)(1) (relating to carbon fee). . The table of sections for subchapter A of chapter 98 of such Code is amended by adding at the end the following new item: Sec. 9512. Climate Action Rebate Fund. .

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