((a)) ** Policy** Nothing in this section shall be construed to affect the application of and all of the provisions of this section shall be carried out in accordance with the provisions of .section 1251(g) of this titlesection 1251(g) of this title

((b)) ** Definitions** In this section:

((1)) ** Alternative water source project** The term “alternative water source project” means a project designed to provide municipal, industrial, and agricultural water supplies in an environmentally sustainable manner by conserving, managing, reclaiming, or reusing water, wastewater, or stormwater or by treating wastewater or stormwater for groundwater recharge, potable reuse, or other purposes. Such term does not include water treatment or distribution facilities.

((2)) ** Critical water supply needs** The term “critical water supply needs” means existing or reasonably anticipated future water supply needs that cannot be met by existing water supplies, as identified in a comprehensive statewide or regional water supply plan or assessment projected over a planning period of at least 20 years.

((c)) ** Establishment** The Administrator may establish a pilot program to make grants to State, interstate, and intrastate water resource development agencies (including water management districts and water supply authorities), local government agencies, private utilities, and nonprofit entities for alternative water source projects to meet critical water supply needs.

((d)) ** Eligible entity** The Administrator may make grants under this section to an entity only if the entity has authority under State law to develop or provide water for municipal, industrial, and agricultural uses in an area of the State that is experiencing critical water supply needs.

((e)) ** Selection of projects**

((1)) ** Limitation** A project that has received construction funds under the reclamation and reuse program conducted under the Reclamation Projects Authorization and Adjustment Act of 1992 ( et seq.) shall not be eligible for grant assistance under this section.43 U.S.C. 390h

((2)) ** Geographical distribution** Alternative water source projects selected by the Administrator under this section shall reflect a variety of geographical and environmental conditions.

((f)) ** Uses of grants** Amounts from grants received under this section may be used for engineering, design, construction, and final testing of alternative water source projects designed to meet critical water supply needs. Such amounts may not be used for planning, feasibility studies or for operation, maintenance, replacement, repair, or rehabilitation.

((g)) ** Cost sharing** The Federal share of the eligible costs of an alternative water source project carried out using assistance made available under this section shall not exceed 50 percent.

((h)) ** Reports** On or before , the Administrator shall transmit to Congress a report on the results of the pilot program established under this section, including progress made toward meeting the critical water supply needs of the participants in the pilot program.September 30, 20042004-09-30

((i)) ** Authorization of appropriations**

((1)) ** In general** There is authorized to be appropriated to carry out this section $25,000,000 for each of fiscal years 2022 through 2026, to remain available until expended.

((2)) ** Limitation on use of funds** Of the amounts made available for grants under paragraph (1), not more than 2 percent may be used to pay the administrative costs of the Administrator.