[Federal Register Volume 63, Number 22 (Tuesday, February 3, 1998)]
[Proposed Rules]
[Pages 5474-5480]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-2553]
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DEPARTMENT OF AGRICULTURE
Rural Business--Cooperative Service
Rural Utilities Service
7 CFR Part 4284
RIN 0570-AA05
Rural Business Opportunity Grants
AGENCIES: Rural Business--Cooperative Service and Rural Utilities
Service, USDA.
ACTION: Proposed rule.
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SUMMARY: The Rural Business-Cooperative Service (RBS) is proposing to
issue new regulations for the Rural Business Opportunity Grant (RBOG)
Program. This action is needed to implement a new program authorized by
section 741 of the Federal Agriculture Improvement and Reform Act of
1996, Public Law 104-127, to assist economic development in rural
areas. The intended effect of this action is to implement the RBOG
program.
DATES: Written or E-mail comments must be received on or before March
20, 1998 to be assured of consideration. The comment period for
information collections under the Paperwork Reduction Act of 1995
continues through April 6, 1998.
ADDRESSES: Submit written comments in duplicate to the Branch Chief,
Regulations And Paperwork Management Branch, Rural Development, U.S.
Department of Agriculture, STOP 0743, Room 6345, 1400 Independence Ave.
SW, Washington, DC 20250-0743. Comments may be submitted via the
Internet by addressing them to ``Comments@rus.usda.gov'' and must
contain the word ``opportunity'' in the subject. All written comments
made pursuant to this notice will be available for public inspection
between 8:00 a.m. and 4:30 p.m. Monday through Friday, except Holidays,
at the above office.
FOR FURTHER INFORMATION CONTACT: M. Wayne Stansbery, Loan Specialist,
Specialty Lenders Division, Rural Business-Cooperative Service, U.S.
Department of Agriculture, STOP 1521, 1400 Independence Ave. SW,
Washington, DC 20250, Telephone (202) 720-6819.
SUPPLEMENTARY INFORMATION:
Classification
This rule has been determined to be significant and has been
reviewed by the Office of Management and Budget under Executive Order
12866.
Programs Affected
The Catalog of Federal Domestic Assistance number for the program
impacted by this action is 10.773, Rural Business Opportunity Grants.
Paperwork Reduction Act
In accordance with the Paperwork Reduction Act of 1995 (44 U.S.C.
chapter 35), RBS announces its intention to seek Office of Management
and Budget (OMB) approval of the reporting and recordkeeping
requirements associated with this proposed rule.
The purpose of the RBOG program is to promote sustainable economic
development in rural communities with exceptional needs. This will be
achieved through grants to public bodies, nonprofit community
development corporations or entities and other agencies, to enable the
recipients to carry on activities related to rural economic
development, such as identifying and analyzing business opportunities,
establishing business support centers, and providing training,
technical assistance, and planning.
The information requirements contained within the regulations are
requested from grant applicants and grant recipients. The information
is vital for RBS to make prudent decisions regarding eligibility of
applicants and selection priority among competing applicants, to ensure
compliance with applicable laws and regulations, and to evaluate the
program. It includes information to allow the Agency to determine that
an applicant is a legally organized entity with authority to enter into
contracts and carry out the proposed activities. It provides for a
description and scope of the proposed activities. It includes
information on the applicant's financial condition and stability. It
includes information to provide for evaluation of grantee
accomplishments. It requires information needed to ensure compliance
with Executive Orders and provides methods for applicants and grantees
to appeal adverse decisions, request changes in grant conditions and
request exceptions to the regulations. No new forms are created for
this program.
Public Burden in 7 CFR Part 4284, Subpart G
At this time, the Agency is requesting OMB clearance of the
following burden:
Section 4284.638(a)(2)(i). Copies of organizational documents, such
as Articles of Incorporation, Bylaws, and certificates of good
standing, are part of the grant application. They are needed so RBS can
be sure the applicant is a legal entity with authority to make
commitments and perform the activities called for under the proposed
grant. They also indicate who is officially in control of the applicant
organization.
Section 4284.638(a)(2)(ii). A written scope of work needed to
document what the grant funds are to be used for and what is to be
accomplished. This is important for evaluating the application and also
for monitoring to ensure that funds are used for the purpose for which
they were intended.
Section 4284.638(a)(2)(iii). A written narrative is required to
provide additional information, beyond what is provided in the scope of
work, as to the need for the project, the service area, the applicant's
ability to accomplish the planned activities, who will be assisted,
what impact is expected, and how the work will be performed. The
information is needed to properly evaluate each application and select
the most deserving applications for funding.
Section 4284.638(a)(2)(iv). A financial statement is required to
help RBS to ensure that an applicant has the financial stability to
remain in operation and supplement the grant funds as necessary to
accomplish the grant purposes.
Section 4284.638(a)(2)(v). It is an eligibility requirement that
applicants include a basis for determining the success or failure of
the project in their proposal. This requirement ensures that some
method exists for evaluating the success or failure of each grant and
that the applicants will have input in determining how they will be
evaluated.
Section 4284.638(a)(2)(vi). Intergovernmental Review comments,
[[Page 5475]]
obtained by the applicant through contact with the State Single Point
of Contact, are required to comply with Executive Order 12372 and to
ensure that the proposed activity is not in conflict with strategic
plans of State and local governments.
Section 4284.656(a). A project performance report is needed to help
the Agency ensure that projects in process are progressing
satisfactorily and that completed projects have, in fact been completed
and paid for in full. If cost overruns, deviations from the approved
scope, or other problems do develop this will help ensure that the
Agency is made aware in time to help find a solution.
Section 4284.656(b). A project evaluation is needed to assist the
Agency in determining the impact of the grant and of the program.
Section 4284.656(c). A project description is needed for selected
projects in order that the information gained from the project can be
shared with other communities, and thereby increase the overall
effectiveness of the program.
Section 4284.656 (d) and (e). It is necessary for the grantee to
keep complete and accurate accounting records as evidence that the
grant funds were used properly.
Section 4284.657. Audits are required to help monitor grantee
activities and financial condition and ensure the grant funds were used
as planned, as well as to comply with OMB circulars and applicable USDA
regulations located at 7 CFR 3015, 3016, 3019, and 3051.
Section 4284.668. This provision allows grantees to request changes
so that approved projects may be changed, with Agency review and
approval, when the change is needed and still within program
guidelines.
Section 4284.684. A provision permits grantees to request and
obtain, in limited circumstances, exceptions to provisions of this
subpart.
Estimate of Burden: Public reporting burden for this collection of
information is estimated to average 5.7 hours per response.
Respondents: Public Bodies and Nonprofit Corporations.
Estimated Number of Respondents: 100.
Estimated Number of Responses per Respondent: 15.23.
Estimated Total Annual Burden on Respondents: 8,704 hours.
The complete text of the proposed rule is published herein for
public review and comment. Additional copies of the proposed
regulations or copies of referenced forms may be obtained from Sam
Spencer, Rural Business Team Information Collection Coordinator, by
calling (202) 720-9588. Written requests may also be submitted to Sam
Spencer, Rural Business Team Information Collection Coordinator,
Regulations and Paperwork Management Division, U.S. Department of
Agriculture, Rural Development, STOP 0743, 1400 Independence Ave. SW,
Washington, DC 20250-0743.
Comments: Comments are invited on: (a) Whether the proposed
collection of information is necessary for the proper performance of
the functions of RBS, including whether the information will have
practical utility; (b) the accuracy of RBS's estimate of the burden of
the proposed collection of information including the validity of the
methodology and assumptions used; (c) ways to enhance the quality,
utility and clarity of the information to be collected; and (d) ways to
minimize the burden of the collection of information on those who are
to respond, including through the use of appropriate automated,
electronic, mechanical, or other technological collection techniques or
other forms of information technology. Comments should be submitted to
the Desk Officer for Agriculture, Office of Information and Regulatory
Affairs, Office of Management and Budget, Washington, DC 20503, and to
Sam Spencer, Rural Business Team Information Collection Coordinator,
Regulations and Paperwork Management Branch, U.S. Department of
Agriculture, Rural Development, STOP 0743, 1400 Independence Ave. SW,
Washington, DC 20250-0743. All responses to this notice will be
summarized, be included in the request for OMB approval, and become a
matter of public record. OMB is required to make a decision concerning
the collections of information contained in these proposed regulations
between 30 and 60 days after submission to OMB. Therefore, a comment to
OMB is best assured of having full effect if OMB receives it within 30
days of publication. This does not affect the deadline for the public
to comment on the proposed regulation.
Intergovernmental Review
Rural Business Opportunity Grants are subject to the provisions of
Executive Order 12372 which requires intergovernmental consultation
with State and Local officials. RBS has conducted or will conduct
intergovernmental consultation in the manner delineated in RD
Instruction 1940-J, ``Intergovernmental Review of Farmers Home
Administration Programs and Activities,'' and in 7 CFR 3015, subpart V.
Civil Justice Reform
This proposed rule has been reviewed under Executive Order 12988,
Civil Justice Reform. In accordance with this rule: (1) All State and
local laws and regulations that are in conflict with this rule will be
preempted; (2) no retroactive effect will be given this rule; and (3)
administrative proceedings in accordance with the regulations of the
Agency at 7 CFR part 11 must be exhausted before bringing suit in court
challenging action taken under this rule unless those regulations
specifically allow bringing suit at an earlier time.
Environmental Impact Statement
This document has been reviewed in accordance with 7 CFR part 1940,
subpart G, ``Environmental Program.'' RBS has determined that this
proposed action does not constitute a major Federal action
significantly affecting the quality of the human environment, and in
accordance with the National Environmental Policy Act of 1969, Public
Law 91-190, an Environmental Impact Statement is not required.
Unfunded Mandates
Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), Public
Law 104-4, establishes requirements for Federal agencies to assess the
effects of their regulatory actions on State, local, and tribal
governments and the private sector. Under section 202 of the UMRA, RBS
must prepare a written statement, including a cost-benefit analysis,
for proposed and final rules with ``Federal mandates'' that may result
in expenditures to State, local or tribal governments, in the
aggregate, or to the private sector, of $100 million or more in any one
year. When such a statement is needed for a rule, section 205 of UMRA
generally requires RBS to identify and consider a reasonable number of
regulatory alternatives and adopt the least costly, more cost effective
or least burdensome alternative that achieves the objectives of the
rule.
This rule contains no Federal mandates (under the regulatory
provisions of Title II of the UMRA) for State, local, and tribal
governments or the private sector. Thus this rule is not subject to the
requirements of sections 202 and 205 of UMRA.
Regulatory Flexibility Act
In compliance with the Regulatory Flexibility Act, RBS has
determined that this action would not have a significant economic
impact on a substantial number of small entities because the action
will not affect a significant number of small entities as defined by
the Regulatory Flexibility Act (5 U.S.C.
[[Page 5476]]
601). RBS made this determination based on the fact that this
regulation only impacts those who choose to participate in the grant
program. Small entity applicants will not be impacted to a greater
extent than large entity applicants.
Background
RBS proposes a new regulation to implement a grant program to fund
technical assistance and planning activities in rural areas for the
purpose of improving economic conditions in the areas. This action is
necessary to comply with section 741 of the Federal Agriculture
Improvement and Reform Act of 1996, Public Law 104-127. Grants will be
available to public bodies, nonprofit corporations, Indian tribes, and
cooperatives. Grants may be used for technical assistance for business
development and economic development planning; identifying and
analyzing business opportunities that will use local rural materials or
human resources, including opportunities in export markets as well as
feasibility and business plan studies; identifying, training, and
providing technical assistance to existing or prospective rural
entrepreneurs and managers; establishing business support centers and
otherwise assisting in the creation of new rural businesses; conducting
local community or multi-county economic development planning;
establishing centers for training, technology, and trade that will
provide training to rural businesses in the utilization of interactive
communications technologies to develop international trade
opportunities and markets; and conducting leadership development
training of existing or prospective rural entrepreneurs and managers.
Nonmetropolitan median family income stagnated during the 1980's
and continued substantially unchanged through the early 1990's. The
1992 rural poverty rate of 16.8 percent was not statistically different
from the 1989 rate, but was significantly higher than the urban poverty
rate of 13.9 percent. Perhaps of more concern than the average or
median figures is that rural income, poverty levels, and employment are
uneven. During the 1980's, over one half of rural counties suffered
declines in real median household income. Median real income generally
increased in metropolitan areas, held steady in counties adjacent to
metropolitan areas, and fell in more isolated rural counties. This put
remote and persistently low-income counties in a relatively worse
income position compared to metropolitan areas. Also, rural minorities
continue to be disproportionately poor, with poverty rates highest
among blacks, but increasing more rapidly among Hispanics.
The implementation of this program is part of an initiative to
enhance the future prosperity of rural people through investments that
enhance rural competitiveness, facilitate industrial conversion, and
enable rural citizens to profit from private economic activity. The
implementation of this program will provide rural business with
technical assistance not previously available. The business will be
able to provide jobs, economic activity, and economic diversification
in rural communities.
List of Subjects in 7 CFR Part 4284
Business and industry, Economic development, Grant programs--
Housing and community development, Rural areas.
Therefore, chapter XLII, title 7, Code of Federal Regulations, is
proposed to be amended as follows:
PART 4284--GRANTS
1. The authority citation for part 4284 continues to read as
follows:
Authority: 5 U.S.C. 301, 7 U.S.C. 1989, 16 U.S.C. 1005.
2. Subpart G of part 4284, consisting of Sec. Sec. 4284.601 through
4284.700, is added to read as follows:
Subpart G--Rural Business Opportunity Grants
Sec.
4284.601 Purpose.
4284.602 Policy.
4284.603 Definitions.
4284.604-4284.619 [Reserved]
4284.620 Applicant eligibility.
4284.621 Eligible grant purposes.
4284.622-4284.628 [Reserved]
4284.629 Ineligible grant purposes.
4284.630 Other considerations.
4284.631-4284.637 [Reserved]
4284.638 Application processing.
4284.639 Grant selection criteria.
4284.640 Appeals.
4284.641-4284.646 [Reserved]
4284.647 Grant approval and obligation of funds.
4284.648 Fund disbursement.
4284.649-4284.655 [Reserved]
4284.656 Reporting.
4284.657 Audit requirements.
4284.658-4284.666 [Reserved]
4284.667 Grant servicing.
4284.668 Programmatic changes.
4284.669-4284.683 [Reserved]
4284.684 Exception authority.
4284.685-4284.698 [Reserved]
4284.699 Congress.
4284.700 OMB control number.
Subpart G--Rural Business Opportunity Grants
Sec. 4284.601 Purpose.
This subpart outlines Agency policies and authorizations and sets
forth procedures for making grants to provide technical assistance for
business development and conduct economic development planning in rural
areas. The purpose of this program is to promote sustainable economic
development in rural communities with exceptional needs by:
(a) Promoting economic development that is sustainable over the
long term through local effort without subsidies or external support
and that leads to improvements in quality as well as the quantity of
economic activity in the community;
(b) Catalyzing economic development projects by providing critical
investments that enable effective development projects to be undertaken
by rural communities that, with the assistance, will be able to
identify their needs and take full advantage of available resources and
opportunities;
(c) Focusing assistance on priority communities (defined in
Sec. 4284.603); and
(d) Sponsoring economic development activities with significant
potential to serve as examples of ``best practices'' that merit
implementation in rural communities in similar circumstances.
Sec. 4284.602 Policy.
(a) The grant program will be used to assist in the economic
development of rural areas.
(b) Funds allocated for use in accordance with this subpart are
also to be considered for use by Indian tribes within the State
regardless of whether State development strategies include Indian
reservations within the State's boundaries. Indians residing on such
reservations must have equal opportunity, along with other rural
residents, to participate in the benefits of these programs.
Sec. 4284.603 Definitions.
Agency--The Federal agency within the United States Department of
Agriculture (USDA) with responsibility assigned by the Secretary of
Agriculture to administer the Rural Business Opportunity Grants (RBOG)
Program. At the time of publication, of this part in the Federal
Register, that agency is the Rural Business-Cooperative Service.
Best practice project--An action that has potential applicability
in other rural communities and which potentially has instructional
value when shared with those communities.
[[Page 5477]]
Business support centers--Centers established to provide assistance
to businesses in such areas as counseling, business planning, training,
management assistance, marketing information, and locating financing
for business operations. The centers need not be located in a rural
area, but must provide assistance to businesses located in rural areas.
Economic development--The industrial, business and financial
augmentation of an area as evidenced by increases in total income,
employment opportunities, value of production, duration of employment,
or diversification of industry, reduced outmigration, higher labor
force participation rates or wage levels, or gains in other
measurements of economic activity, such as land values.
Planning--A process to coordinate economic development activities,
develop guides for action, or otherwise assist local community leaders
in the economic development of rural areas.
Priority communities--Communities targeted for Agency assistance as
determined by the USDA Under Secretary for Rural Development. Priority
communities are those that are experiencing trauma due to natural
disasters or are undertaking or completing fundamental structural
changes, have remained persistently poor over the past 60 years or
longer, or have experienced long-term population decline or job
deterioration.
Project--The result of the use of grant funds provided under this
subpart through technical assistance or planning relating to the
economic development of a rural area.
Rural and rural area--Any area of a State that is not within the
boundaries of a city with a population in excess of 10,000 inhabitants
according to the latest decennial census of the United States.
State--Any of the 50 states, the Commonwealth of Puerto Rico, the
Virgin Islands of the United States, Guam, American Samoa, the
Commonwealth of the Northern Mariana Islands, the Republic of Palau,
the Federated States of Micronesia, and the Republic of the Marshall
Islands.
Technical assistance--A nonconstruction, problem solving activity
performed for the benefit of a business or community to assist in the
economic development of a rural area. The Agency will determine whether
a specific activity qualifies as technical assistance.
United States. The 50 States of the United States of America, the
District of Columbia, the Commonwealth of Puerto Rico, the Virgin
Islands of the United States, Guam, American Samoa, the Commonwealth of
the Northern Mariana Islands, the Republic of Palau, the Federated
States of Micronesia, and the Republic of the Marshall Islands.
Sec. Sec. 4287.604-4287.619 [Reserved]
Sec. 4284.620 Applicant eligibility.
(a) Grants may be made to public bodies, nonprofit corporations,
Indian tribes on Federal or State reservations and other Federally
recognized tribal groups, and cooperatives with members that are
primarily rural residents and that conduct activities for the mutual
benefit of the members.
(b) Applicants must have sufficient financial strength and
expertise in activities proposed in the application to ensure
accomplishment of the described activities and objectives.
(c) Any delinquent debt to the Federal Government shall cause the
applicant to be ineligible to receive any RBOG funds until the debt has
been paid.
Sec. 4284.621 Eligible grant purposes.
(a) Grant funds may be used to assist in the economic development
of rural areas by providing technical assistance for business
development and economic development planning. Grant funds may be used
for, but are not limited to, the following purposes:
(1) Identify and analyze business opportunities that will use local
rural materials or human resources. This includes opportunities in
export markets, as well as feasibility and business plan studies;
(2) Identify, train, and provide technical assistance to existing
or prospective rural entrepreneurs and managers;
(3) Establish business support centers and otherwise assist in the
creation of new rural businesses;
(4) Conduct local community or multi-county economic development
planning;
(5) Establish centers for training, technology, and trade that will
provide training to rural businesses in the utilization of interactive
communications technologies to develop international trade
opportunities and markets;
(6) Conduct leadership development training of existing or
prospective rural entrepreneurs and managers; or
(7) Pay reasonable fees and charges for professional services
necessary to conduct the technical assistance, training, or planning
functions.
(b) Grants may be made only when there is a reasonable prospect
that the project will result in the economic development of a rural
area.
(c) Grants may be made only when the proposal includes a basis for
determining the success or failure of the project and individual major
elements of the project and outlines procedures that will be taken to
assess the project's impact at its conclusion.
(d) Grants may be made only when the proposed project is consistent
with local and area-wide strategic plans for community and economic
development, coordinated with other economic development activities in
the project area and consistent with any USDA Rural Development State
Strategic Plan.
(e) A grant may be considered for the amount needed to assist with
the completion of a proposed project, provided that the project can
reasonably be expected to be completed within 2 full years after it is
begun. If grant funds are requested to establish or assist with an
activity of more than 2 years duration, the amount of a grant approved
in any fiscal year will be limited to the amount needed to assist with
no more than 1 full year of operation. Subsequent grant requests may be
considered in subsequent years, if needed to continue the operation,
but funding for 1 year provides no assurance of additional funding in
subsequent years.
Sec. Sec. 4284.622-4284.628 [Reserved]
Sec. 4284.629 Ineligible grant purposes.
Grant funds may not be used to:
(a) Duplicate current services or replace or substitute support
previously provided;
(b) Pay costs of preparing the application package for funding
under this program;
(c) Pay costs of the project incurred prior to the effective date
of the grant made under this subpart;
(d) Fund political activities;
(e) Pay for assistance to any private business enterprise which
does not have at least 51 percent ownership by those who are either
citizens of the United States or reside in the United States after
being legally admitted for permanent residence;
(f) Pay any judgment or debt owed to the United States; or
(g) Pay costs of real estate acquisition or development or building
construction.
Sec. 4284.630 Other considerations.
(a) Civil rights compliance requirements. All grants made under
this subpart are subject to Title VI of the Civil Rights Act of 1964
and part 1901, subpart E, of this title.
(b) Environmental review. All grants made under this subpart are
subject to
[[Page 5478]]
the requirements of subpart G of part 1940 of this title. Applications
for technical assistance or planning projects are generally excluded
from the environmental review process by Sec. 1940.333 of this title.
However, as further specified in that section, the grantee in the
process of providing technical assistance, must consider the potential
environmental impacts of the recommendations provided to the ultimate
recipient of the technical assistance. Plans developed with grant funds
received under this subpart must be generally documented to include the
important environmental resources within the planning area and the
potential environmental impacts of the plan as well as the alternative
planning strategies that were reviewed.
(c) Other USDA regulations. This program is subject to the
provisions of the following regulations, as applicable, which are
incorporated by reference herein:
(1) 7 CFR part 3015, ``Uniform Federal Assistance Regulations'';
(2) 7 CFR part 3016, ``Uniform Administrative Requirements for
Grants and Cooperative Agreements to State and Local Governments'';
(3) 7 CFR part 3017, ``Governmentwide Debarment and Suspension
(Nonprocurement) and Governmentwide Requirements for Drug-Free
Workplace (Grants)'';
(4) 7 CFR part 3018, ``New Restrictions on Lobbying'';
(5) 7 CFR part 3019, ``Uniform Administrative Requirements for
Grants and Agreements with Institutions of Higher Education, Hospitals,
and Other Non-Profit Organizations''; and
(6) 7 CFR part 3051, ``Audits of Institutions of Higher Education
and other Nonprofit Institutions.''
Secs. 4284.631-4284.637 [Reserved]
Sec. 4284.638 Application processing.
(a) Applications. (1) Applicants will file an original and one copy
of an ``Application For Federal Assistance (For Nonconstruction)'' with
the Agency State Office. This form is available in all Agency offices.
(2) All applications shall be accompanied by:
(i) Copies of applicant's organizational documents showing the
applicant's legal existence and authority to perform the activities
under the grant;
(ii) A proposed scope of work, including a description of the
proposed project, details of the proposed activities to be accomplished
and timeframes for completion of each task, the number of months
duration of the project, and the estimated time it will take from grant
approval to beginning of project implementation;
(iii) A written narrative which includes, at a minimum, the
following items:
(A) An explanation of why the project is needed, the benefits of
the proposed project, and how the project meets the grant selection
criteria;
(B) Area to be served, identifying each governmental unit, i.e.,
town, county, etc., to be affected by the project;
(C) Description of how the project will coordinate economic
development activities with other economic development activities
within the project area;
(D) Business to be assisted, if appropriate; economic development
to be accomplished;
(E) An explanation of how the proposed project will result in
increased or saved jobs in the area and the number of projected new and
saved jobs;
(F) Description of the applicant's demonstrated capability and
experience in providing the proposed project assistance or similar
economic development activities, including experience of key staff
members and persons who will be providing the proposed project
activities and managing the project;
(G) Method and rationale used to select the areas and businesses
that will receive the service;
(H) Brief description of how the work will be performed including
whether organizational staff or consultants or contractors will be
used; and
(I) Other information the Agency may request to assist it in making
a grant award determination.
(iv) The latest financial information to show the organization's
financial capacity to carry out the proposed work. At a minimum, the
information should include the most recent balance sheet and an income
statement. A current audited report is required if available;
(v) An evaluation method to be used by the applicant to determine
if objectives of the proposed activity are being accomplished; and
(vi) Intergovernmental review comments from the State Single Point
of Contact, or evidence that the State has elected not to review the
program under Executive Order 12372.
(b) Letter of conditions. The Agency will deliver a letter to the
applicant setting out the conditions under which the grant will be
made.
(c) Applicant's intent to meet conditions. Upon reviewing the
conditions and requirements in the letter of conditions, the applicant
must complete, sign and return a ``Letter of Intent to Meet
Conditions,'' to the Agency; or if certain conditions cannot be met,
the applicant may propose alternate conditions to the Agency. The
Agency must concur with any changes proposed to the letter of
conditions by the applicant before the application will be further
processed.
Sec. 4284.639 Grant selection criteria.
Agency officials will select projects to receive assistance under
this program according to the following criteria:
(a) A score of 0 to 10 points will be awarded based on the Agency
assessment of the extent to which economic development resulting from
the proposed project will be sustainable over the long term by local
efforts, without the need for continued subsidies by governments or
other organizations outside the community or communities that will
receive the primary benefit of the grant.
(b) A score of 0 to 10 points will be awarded based on the Agency
assessment of the extent to which the project should lead to
improvements in the quality of economic activity within the community
or communities that will receive the primary benefit of the grant, such
as higher wages, improved benefits, greater career potential, and the
use of higher levels of skills than currently are typical within the
economy.
(c) If the grant will fund a critical element of a larger program
of economic development, without which the overall program either could
not proceed or would be far less effective, or if the program to be
assisted by the grant will also be partially funded from other sources,
points will be awarded as follows based on the percentage of the cost
of the overall program that will be funded by the grant.
(1) Less than 20 percent--30 points;
(2) 20 but less than 50 percent--20 points;
(3) 50 but less than 75 percent--10 points; or
(4) More than 75 percent--0 points.
(d) Points will be awarded for each of the following criteria met
by the community or communities that will receive the primary benefit
of the grant. However, regardless of the mathematical total of points
indicated by paragraphs (d)(1) through (d)(5) of this section, total
points awarded under paragraph (d) must not exceed 40.
(1) Experiencing trauma due to a major natural disaster that
occurred not more than three years prior to the filing of the
application for RBOG assistance--15 points;
(2) Undergoing fundamental structural change in the local economy,
such as that caused by the closing or
[[Page 5479]]
major downsizing of a military facility or other major employer not
more than 3 years prior to the filing of the application for RBOG
assistance--15 points;
(3) Has remained consistently poor over the past 60 years or more--
10 points;
(4) Has experienced long-term population decline--10 points; and
(5) Has experienced long-term job deterioration--10 points.
(e) A score of 0 to 10 points will be awarded based on the Agency
determination of the extent of the project's usefulness as a new best
practice as defined in Sec. 4284.603.
(f) State Directors may assign up to 15 discretionary points to an
application. If allocation of funds under National Office control is
being considered, the Agency Administrator may assign up to 20
additional discretionary points. Assignment of discretionary points by
either the State Director or the Agency Administrator must include a
written justification. Justifications are geographic distribution of
funds, special importance for implementation of a strategic plan in
partnership with other organizations, and extraordinary potential for
success due to superior project plans or qualifications of the grantee.
Sec. 4284.640 Appeals.
Any appealable adverse decision made by the Agency may be appealed
in accordance with USDA appeal regulations found at 7 CFR part 11.
Secs. 4284.641-4284.646 [Reserved]
Sec. 4284.647 Grant approval and obligation of funds.
The following statement will be entered in the comment section of
the ``Request for Obligation of Funds,'' which must be signed by the
Grantee:
``The Grantee certifies that it is in compliance and will
continue to comply with all applicable laws; regulations; Executive
Orders; and other generally applicable requirements, including those
set forth in 7 CFR part 4284, subpart G, and 7 CFR parts 3015, 3016,
3017, 3018, 3019, and 3051 in effect on the date of grant approval;
and the approved Letter of Conditions.''
Sec. 4284.648 Fund disbursement.
The Agency will determine, based on 7 CFR parts 3015, 3016, and
3019 as applicable, whether disbursement of a grant will be by advance
or reimbursement. A ``Request for Advance or Reimbursement'' must be
completed by the grantee and submitted to the Agency no more often than
monthly to request either advance or reimbursement of funds.
Secs. 4284.649-4284.655 [Reserved]
Sec. 4284.656 Reporting.
(a) A ``Financial Status Report'' and a project performance
activity report will be required of all grantees on a quarterly
calendar year basis. The Grantee will cause said program to be
completed within the total sums available to it, including the grant,
in accordance with the scope of work and any necessary modifications
thereof prepared by Grantee and approved by the Agency. A final project
performance report will be required with the final Financial Status
Report. The final report may serve as the last quarterly report. The
final report must provide complete information regarding the jobs
created and saved as a result of the grant. Grantees shall constantly
monitor performance to ensure that time schedules are being met,
projected work by time periods is being accomplished, and other
performance objectives are being achieved. Grantees are to submit an
original of each report to the Agency. The project performance reports
shall include, but not be limited to, the following:
(1) A comparison of actual accomplishments to the objectives
established for that period;
(2) Problems, delays, or adverse conditions, if any, which have
affected or will affect attainment of overall project objectives,
prevent meeting time schedules or objectives, or preclude the
attainment of particular project work elements during established time
periods. This disclosure shall be accompanied by a statement of the
action taken or planned to resolve the situation; and
(3) Objectives and timetable established for the next reporting
period.
(b) Within 1 year after the conclusion of the project, the grantee
will provide a project evaluation report based on criteria developed in
accordance with Sec. Sec. 4284.621(c) and 4284.638(a)(2)(v) of this
subpart.
(c) The Agency may also require grantees to prepare a report
suitable for public distribution describing the accomplishments made
through the use of the grant and, in the case where the grant funded
the development or application of a ``best practice,'' to describe that
``best practice.''
(d) The grantee will provide for Financial Management Systems which
will include:
(1) Accurate, current, and complete disclosure of the financial
result of each grant.
(2) Records which identify adequately the source and application of
funds for grant-supporting activities, together with documentation to
support the records. Those records shall contain information pertaining
to grant awards and authorizations, obligations, unobligated balances,
assets, liabilities, outlays, and income.
(3) Effective control over and accountability for all funds.
Grantee shall adequately safeguard all such assets and shall assure
that funds are used solely for authorized purposes.
(e) The grantee will retain financial records, supporting
documents, statistical records, and all other records pertinent to the
grant for a period of at least 3 years after grant closing except that
the records shall be retained beyond the 3-year period if audit
findings have not been resolved or if directed by the United States.
Microfilm copies may be substituted in lieu of original records. The
Agency and the Comptroller General of the United States, or any of
their duly authorized representatives, shall have access to any books,
documents, papers, and records of the grantee which are pertinent to
the specific grant program for the purpose of making audit,
examination, excerpts, and transcripts.
Sec. 4284.657 Audit requirements.
Public body grantees will provide an annual audit in accordance
with 7 CFR part 3015, subpart I. Nonprofit corporation grantees will
provide an annual audit in accordance with 7 CFR part 3051. The audit
requirements apply to the years in which grant funds are disbursed to
the grantee and years in which work is accomplished that will be paid
for with grant funds.
Secs. 4284.658-4284.666 [Reserved]
Sec. 4284.667 Grant servicing.
Grants will be serviced in accordance with part 1951, subparts E
and O, of this title. Grantees will permit periodic inspection of the
program operations by a representative of the Agency. All non-
confidential information resulting from the Grantee's activities shall
be made available to the general public on an equal basis. Grantee
shall relinquish any and all copyrights or privileges to the material
developed under this grant as published in whole or in part. The
material shall contain notice and be identified by language to the
following effect: ``This material is the result of tax-supported
research and as such is not copyrightable. It may be freely reprinted
with the customary crediting of the source.''
Sec. 4284.668 Programmatic changes.
The Grantee shall obtain prior approval for any change to the scope
or
[[Page 5480]]
objectives of the approved project. Failure to obtain prior approval of
changes to the scope of work or budget may result in suspension,
termination, and recovery of grant funds.
Sec. Sec. 4284.669-4284.683 [Reserved]
Sec. 4284.684 Exception authority.
The Administrator may, in individual cases, grant an exception to
any requirement or provision of this subpart which is not inconsistent
with any applicable law, provided the Administrator determines that
application of the requirement or provision would adversely affect
USDA's interest.
Sec. Sec. 4284.685-4284.698 [Reserved]
Sec. 4284.699 Congress.
No member of Congress shall be admitted to any share or part of
this grant or any benefit that may arise therefrom; but this provision
shall not be construed to bar as a contractor under the grant a
publicly held corporation whose ownership might include a member of
Congress.
Sec. 4284.700 OMB control number.
Dated: January 22, 1998.
Jill Long Thompson,
Under Secretary, Rural Development.
[FR Doc. 98-2553 Filed 2-2-98; 8:45 am]
BILLING CODE 3410-XY-U
