Water Quality Financing Act of 2007

Water Quality Financing Act of 2007 - Title I: Technical and Management Assistance - (Sec. 101) Amends the Federal Water Pollution Control Act (popularly known as the Clean Water Act [CWA]) to authorize the Administrator of the Environmental Protection Agency (EPA) to make grants to nonprofit organizations to provide: (1) technical assistance to rural and small municipalities for grants from the Water Pollution Control Revolving Loan Funds; (2) technical assistance and training for rural and small publicly owned treatment works (POTWs) and decentralized wastewater systems to enable them to protect water quality and comply with the CWA; and (3) information to rural and small municipalities and municipalities that meet a state's affordability criteria with respect to planning, design, construction, and operation of POTWs and decentralized wastewater treatment systems.

Authorizes annual appropriations for FY2008-FY2012 for grants for: (1) research, investigations, experiments, training, demonstrations, surveys, and studies relating to the causes, effects, extent, prevention, reduction, and elimination of pollution; and (2) financial and technical assistance for communities. Directs that at least 20% of the funding appropriated be used for such financial and technical assistance grants. Requires the Administrator to make available a specified amount to support an EPA clearinghouse that collects and disseminates information on small flows of sewage and innovative or alternative wastewater treatment processes and techniques. Requires the Administrator to establish procedures to promote competition and openness in the award of grants to nonprofit organizations.

(Sec. 102) Authorizes annual appropriations for FY2008-FY2012 for state water pollution control grants.

(Sec. 103) Includes among the types of pilot projects for which the Administrator is authorized to provide technical assistance and grants for treatment works to carry out projects relating to: (1) stormwater best management practices that control pollutants from municipal separate storm sewer systems and use innovative technologies to manage, reduce, treat, or reuse stormwater, including low-impact technologies; (2) efforts of municipalities and property owners to demonstrate cooperative ways to address nonpoint sources of pollution to reduce adverse impacts on water quality; and (3) development of an integrated water resource plan for the coordinated management and protection of surface water, groundwater, and stormwater resources on a watershed or subwatershed basis. Authorizes annual appropriations through FY2012 for watershed pilot projects.

Title II: Construction of Treatment Works - (Sec. 201) Provides that a community seeking financial assistance from the state revolving fund (SRF) for the replacement or major rehabilitation of a sewage collection system existing on January 1, 2007, or for the construction of a new system shall be eligible for such assistance provided that: (1) the replacement and rehabilitation of the existing collection system or the new collection system is to address an existing adverse environmental condition; and (2) otherwise meets the requirements of the CWA.

(Sec. 202) Amends the definition of "treatment works" to include the acquisition of lands and interests in land that are necessary for construction.

Title III: State Water Pollution Control Revolving Funds - (Sec. 302) Adds conditions for states to follow in order to be eligible for capitalization grants for their revolving funds, including directing states to: (1) comply with federal accounting standards governing the reporting of infrastructure assets; (2) require loan applicants to evaluate innovative and alternative processes, materials, techniques, and technologies for carrying out water infrastructure projects and to select projects that may result in greater environmental benefits; (3) require loan applicants to consider the costs and effectiveness of other design, management, and financing approaches for carrying out the project; (4) use at least 15% of their annual capitalization grants received after September 30, 2007, to assist municipalities serving fewer than 10,000 individuals that meet the state's affordability criteria; and (5) require the Davis-Bacon prevailing wage rates to be paid to workers involved in the construction of treatment works carried out with state assistance from the SRF or federal capitalization grants.

(Sec. 303) Expands the types of projects and activities eligible for assistance through SRFs to include: (1) the implementation of lake protection projects under the Clean Lakes Program; (2) the repair or replacement of decentralized wastewater treatment systems that treat domestic sewage; (3) measures to manage, reduce, treat, or reuse municipal stormwater runoff; (4) measures to reduce the demand for POTW capacity through water conservation, efficiency, or reuse; (5) increased security measures at POTWs; and (6) the development and implementation of watershed pilot projects.

Authorizes states to extend the repayment period for an SRF loan from the current limit of 20 years to the lesser of 30 years or the design life of the project to be financed with the proceeds.

Requires, as a condition of eligibility for a loan from the SRF, that the loan recipient develop and implement a fiscal sustainability plan for any portion of the treatment works proposed for repair, replacement, or expansion. Sets forth the elements that must be included in such a plan.

Authorizes states to use: (1) either 4% of the capitalization grant (current law), $400,000 a year, or up to one-fifth of 1% of the total valuation of the SRF, whichever amount is greatest, for administrative expenses, plus any fees collected for such purposes; (2) up to 2% of the capitalization grant to provide owners and operators of treatment works that serve 10,000 individuals or fewer with technical and planning assistance and assistance in financial management, user fee analysis, budgeting, capital improvement planning, facility operation and maintenance, equipment replacement, repair schedules, and other activities to improve wastewater treatment plant management and operations; and (3) provide additional subsidization, including forgiveness of principal and negative interest loans to benefit specified municipalities or to implement an innovative or alternative process, material, technique, or technology (including low-impact technologies, nonstructural protection of surface waters, a new or improved method of waste treatment, and nutrient pollutant trading) that may result in greater environmental benefits.

Requires states to establish affordability criteria on or before September 30, 2008, to assist in identifying municipalities that would experience a significant hardship raising the revenue necessary to finance the construction of POTWs. Authorizes: (1) states to use the criteria in previously established affordability criteria that meet specified requirements; (2) the Administrator to publish information to assist states in establishing affordability criteria; and (3) states to give priority to a project by local and state governments for the construction of a POTW if the recipient of the funds meets a state's affordability criteria.

Requires states to use 25% of any increases in a federal capitalization grant allotted to a state in fiscal years where the Administrator has more than $1 billion in funds available to provide additional subsidization for projects identified in the state's intended use plan. Limits the total amount of additional subsidization a state may provide to 30% of the total amount of capitalization grants received by the state.

(Sec. 304) Preserves the current SRF allotment formula for capitalization grants for the first $1.35 billion of any future fiscal year appropriation. Increases the amount a state may reserve for water quality management planning and state continuing planning processes from the current limit of 1% of such annual grants to 2%. Requires the Administrator, after providing notice and an opportunity for public comment, to publish an allotment formula based on water quality needs in accordance with the most recent survey of needs.

(Sec. 305) Requires states, after providing for public comment, to establish: (1) a list of SRF projects and activities that gives priority to projects that achieve the greatest degree of water quality improvement; and (2) a methodology for prioritizing such projects and activities that takes into consideration whether water quality improvements would be realized without SRF assistance and whether the projects and activities would address water quality impairments associated with existing treatment works. Sets forth considerations that states shall consider in determining which projects and activities will achieve the greatest degree of water quality improvement. Authorizes states to: (1) consider the cumulative water quality improvements associated with projects or activities for categories of nonpoint sources of pollution; and (2) use previously developed methodologies that meet applicable requirements. Requires a state's annual intended use plan to include an explanation of why a state does not fund projects in the order established by its priority list.

(Sec. 306) Requires states, as part of their existing reporting requirements to EPA, to include a list of eligible purposes for which assistance is provided under the SRF.

(Sec. 307) Requires the Administrator: (1) to assist states in establishing simplified procedures for treatment works to obtain SRF assistance; (2) after providing for public comment, to publish a manual to assist treatment works in obtaining such assistance; and (3) at the request of any state and after providing for public comment, to assist in the development of criteria for a state to determine compliance with the conditions of funding assistance.

(Sec. 308) Authorizes appropriations for the capitalization of SRFs for FY2008-FY2011.

Title IV: General Provisions - (Sec 402) Increases the authorized set-aside from SRF funding for serving Indian tribes from the current amount of one-half of 1% to not more than 1.5% of the total federal appropriation for the capitalization of SRFs.

Title V: Studies - (Sec. 501) Requires the Comptroller General to study and report to Congress on: (1) the funding mechanisms and sources available to establish a Clean Water Trust Fund, including an analysis of potential sources that can be efficiently collected, are broad based, are related to water quality, and that support the annual funding levels authorized; and (2) the funding mechanisms and sources potentially available for wastewater infrastructure and other water pollution control activities under the Clean Water Act, including an analysis of funding and investment mechanisms and revenue sources from other potential supplemental or alternative sources that could be used to fund such activities.

(Sec. 503) Requires the Administrator, in consultation with the Secretary of State and the government of Canada, to study the condition of wastewater treatment facilities that discharge into the Great Lakes. Directs the Administrator to: (1) determine the effect that such facilities have on Great Lakes water quality; and (2) develop recommendations to improve water quality monitoring by the operators of such facilities, to establish a protocol for information sharing between the countries, and to promote cooperation between the countries to prevent the discharge of untreated and undertreated waste.

Title VI: Tonnage Duties - (Sec. 601) Changes the tonnage duty on specified vessels entering or returning to a U.S. port from 2 cents per ton to: (1) 4.5 cents per ton (but not more than a total of 22.5 cents per ton per year) for FY2006-FY2007; (2) 9 cents per ton (but not more than a total of 45 cents per ton per year) for FY2008-FY2017; and (3) 2 cents per ton (but not more than a total of 10 cents per ton per year) for each fiscal year thereafter. Changes the higher rate of duties imposed on specified vessels at U.S. entry ports from a foreign port from 6 cents per ton to: (1) 13.5 cents per ton (but not more than a total of 67.5 cents per ton per year) for FY2006-FY2007; (2) 27 cents per ton (but not more than a total of $1.35 per ton per year) for fiscal years 2008 through 2017, and (3) 6 cents per ton (but not more than a total of 30 cents per ton per year) for each fiscal year thereafter.

Title VII: Secure Maritime and Vessel Workforce - (Sec. 701) Prohibits individuals who have been issued transportation worker identification cards from boarding a maritime vessel if the individual has been convicted, or found not guilty by reason of insanity, in a civilian or military jurisdiction of any of the following felonies: (1) espionage; (2) sedition; (3) treason; (4) terrorism; (5) a crime involving a transportation security incident; (6) improper transportation of a hazardous material; (7) unlawful possession, use, sale, distribution, manufacture, purchase, receipt, transfer, shipping, transporting, import, export, storage of, or dealing in an explosive or incendiary device, explosive materials, or a destructive device; (8) murder; (9) conspiring or attempting to commit any of such crimes; and (10) specified violations of the Racketeer Influenced and Corrupt Organizations Act or a comparable state law.