2011-15105. Competitive and Noncompetitive Non-Formula Federal Assistance Programs-Specific Administrative Provisions for the Beginning Farmer and Rancher Development Program

AGENCY:

National Institute of Food and Agriculture, USDA.

ACTION:

Final rule.

SUMMARY:

The National Institute of Food and Agriculture (NIFA) is adopting as a final rule, with changes, an interim rule (published at 74 FR 45968 on September 4, 2009) containing a set of specific administrative requirements for the Beginning Farmer and Rancher Development Program (BFRDP) to supplement the Competitive and Noncompetitive Non-Formula Federal Assistance Programs—General Award Administrative Provisions for this program. The BFRDP is authorized under section 7405 of the Farm Security and Rural Investment Act of 2002, as amended by section 7410 of the Food, Conservation, and Energy Act of 2008.

DATES:

This final rule is effective on June 17, 2011.

FOR FURTHER INFORMATION CONTACT:

Dr. Siva Sureshwaran, National Program Leader, Institute of Food Production and Sustainability; National Institute of Food and Agriculture, U.S. Department of Agriculture, STOP 2240, 1400 Independence Avenue, SW., Washington, DC 20250-2240; Voice: 202-2720-7536; Fax: [phone]; E-mail: [e-mail].

SUPPLEMENTARY INFORMATION:

I. Background and Summary

Authority

Section 7405 of the Farm Security and Rural Investment Act of 2002 (FSRIA), Public Law 107-171 (7 U.S.C. 3319f), as amended by section 7410 of the Food, Conservation, and Energy Act of 2008 (FCEA), Public Law 110-246, authorizes the Secretary of Agriculture (Secretary) to provide training, education, outreach, and technical assistance to beginning farmers or ranchers. The authority to carry out this program has been delegated to the National Institute of Food and Agriculture (NIFA) through the Under Secretary for Research, Education, and Economics.

In carrying out the program, the Secretary is authorized to make competitive grants under section 7405(c) of FSRIA to support new and established local and regional training, education, outreach, and technical assistance initiatives that address the needs of beginning farmers and ranchers. The Secretary may award a BFRDP grant to a collaborative State, Tribal, local, or regionally-based network or partnership of public or private entities, which may include: A State cooperative extension service; a Federal, State, or Tribal agency; a community-based and nongovernmental organization; a college or university (including an institution awarding an associate's degree) or foundation maintained by a college or university; or any other appropriate partner, as determined by the Secretary. BFRDP grants shall be awarded to address needs of beginning farmers and ranchers in the following areas: Mentoring, apprenticeships, and internships; resources and referrals; assisting beginning farmers or ranchers in acquiring land from retiring farmers and ranchers; innovative farm and ranch transfer strategies; entrepreneurship and business training; model land leasing contracts; financial management training; whole farm planning; conservation assistance; risk management education; diversification and marketing strategies; curriculum development; understanding the impact of concentration and globalization; basic livestock and crop farming practices; the acquisition and management of agricultural credit; environmental compliance; information processing; and other similar subject areas of use to beginning farmers or ranchers. Pursuant to FSRIA section 7405(c)(3), these grants shall not have a term of more than 3 years and shall not be in an amount greater than $250,000 per year; however, eligible recipients may receive consecutive grants. These awards also are prohibited by statute from supporting planning, repair, rehabilitation, acquisition, or construction of a building or facility. In addition, not less than 25 percent of these BFRDP grant funds for a fiscal year must be used to support programs and services that address the needs of limited resource beginning farmers or ranchers; socially disadvantaged beginning farmers or ranchers; and farm workers (including immigrant farm workers) desiring to become farmers or ranchers. All BFRDP grant applicants are required to provide funds or in-kind support in an amount that is at least equal to 25 percent of the Federal funds awarded. In making BFRDP grants, priority will be given to partnerships and collaborations that are led by or include nongovernmental and community-based organizations with expertise in new agricultural producer training and outreach. Geographical diversity will be ensured to the maximum extent practicable.

FSRIA section 7405(d) also requires the Secretary to establish beginning farmer and rancher education teams to develop curricula and conduct educational programs and workshops for beginning farmers or ranchers in diverse geographical areas of the United States. The Secretary is required, in promoting the development of curricula and to the maximum extent practicable, to include modules tailored to specific audiences of beginning farmers or ranchers, based on crop or regional diversity. The Secretary is required to cooperate, to the maximum extent practicable, with (1) State cooperative extension services; (2) Federal and State agencies; (3) community-based and nongovernmental organizations; (4) colleges and universities (including an institution awarding an associate's degree) or foundations maintained by a college or university; and other appropriate partners, as determined by the Secretary.

FSRIA section 7405(e) requires the Secretary to establish an online clearinghouse that makes available to beginning farmers or ranchers education curricula and training materials and programs, which may include online courses for direct use by beginning farmers or ranchers.

For fiscal year (FY) 2009, $18 million was made available for the BFRDP, including administrative costs. For FY 2010, $19 million was made available for the BFRDP, including administrative costs. For FY 2011, it is anticipated that $19 million will be made available for the BFRDP, including administrative costs.

Comments on Interim Rule and Development of Final Rule for Subpart J

On September 4, 2009, NIFA published an interim rule [74 FR 45968] to provide administrative provisions that are specific to the BFRDP, as subpart J to 7 CFR part 3430. In the interim rule, NIFA invited comments which were due to the agency by November 3, 2009. We received comments from two professional organizations: Association of Southern Region Extension Directors (ASRED) and National Sustainable Agriculture Coalition (NSAC).

ASRED provided two comments: one on eligibility and the second on the addition of two program types under 7 CFR 3430.604, Project types and priorities. Regarding eligibility, ASRED disagreed with 7 CFR 3430.608(b), Review criteria—Partnership and collaboration, which states: “In making awards under this subpart, NIFA shall give priority to partnerships and collaborations that are led by or include nongovernmental and community-based organizations with expertise in new agricultural producer training and outreach.” ASRED commented that it does not support placing priority for awards on non-governmental organizations (NGOs) and community-based organizations (CBOs). ASRED continued their comment as follows: “NGOs/CBOs certainly can contribute to this program as partner, and in some cases, as lead entities, but we question the idea that, by purpose, structure or outcome, NGOs/CBOs offer any inherent advantage as lead entities.” ASRED requests that the Cooperative Extension Systems be recognized as equally capable lead agencies given the mission of the Cooperative Extension System, as USDA's outreach arm, in partnership with the land-grant institutions and local governments, to provide informal education throughout 3,000 counties and parishes across the United States. ASRED's comment includes a discussion of the efficient and effective use of the national extension system and the research being conducted at the land-grant institutions. NIFA is not revising 7 CFR 3430.608(b) as the authorizing program legislation, at 7 U.S.C. 3319f(c)(7), specifically provides that for Standard BFRDP Project grants priority be given to partnerships and collaborations that are led by or include nongovernmental and community-based organizations with expertise in new agricultural producer training and outreach and, as a matter of agency discretion, NIFA is applying the statutory priority requirement to the other two components of the BFRDP as well.

ASRED's other comment recommended that “tax management, including record keeping and tax form preparation” and “basic agricultural law” be added to the list of BFRDP project focus areas in 7 CFR 3430.604(a), Project types and priorities—Standard BFRDP projects. NIFA agrees with this comment and is revising the regulation to include those subject areas as additional program types under 7 CFR 3430.604(a).

NSAC provided a number of comments on the following sections: 7 CFR 3430.602, Definitions; 7 CFR 3430.605(b), Funding restrictions—Indirect costs; 7 CFR 3430.606(a), Matching requirements—Requirement; 7 CFR 3430.608(a), Review criteria—Evaluation criteria; 7 CFR 3430.608(b), Review criteria—Partnership and collaboration; 7 CFR 3430.609(a), Other considerations—Set aside; 7 CFR 3430.609(c), Other considerations—Duration of awards; and 3430.609(d), Other considerations—Amount of grants. NSAC also provided a recommendation on adopting a regional structure for BFRDP.

7 CFR 3430.602—Definitions

NSAC recommended that NIFA use its statutory discretionary authority to add other criteria to the definition of a “beginning farmer or rancher” to include the “two-fold criteria of the Farm Service Agency (FSA) definition from section 343(11)(D) of the Consolidated Farm and Rural Development Act pertaining to material and substantial participation and day-to-day labor and management.” NSAC stated that adding these additional criteria will ensure that the program is meeting the needs of the audience for which the program was established. NIFA has not revised the definition of “beginning farmer or rancher” because NIFA has chosen to use only criteria identified by Congress in the authorizing legislation.

7 CFR 3430.605(b)—Funding Restrictions—Indirect Costs

NSAC urged NIFA to make BFRDP awards as cooperative agreements and thereby, limit the indirect costs to no more than 10 percent or “in some fashion put a reasonable and modest cap on indirect costs.” NSAC feels that this would allow funds to support as many projects and beginning farmers and ranchers as possible. NSAC points to the success of the Sustainable Agriculture Research and Education (SARE) Program which has been successful for over two decades “despite allowing zero indirect costs.”

NIFA is not revising this section as it cannot use cooperative agreements as a way to limit indirect costs for the standard BFRDP projects. Pursuant to FSRIA § 7405(c)(1) (7 U.S.C. 3319f(c)(1)), and as reflected in 7 CFR 3430.604(a), awards for standard BFRDP projects are required to be made as grants. As with other agricultural research, education, and extension grants, BFRDP grants are subject to the 22 percent cap on indirect costs pursuant to NARETPA § 1462(a) (7 U.S.C. 3310(a)).

For the educational enhancement team projects and online clearinghouse authorized by FSRIA §§ 7405(d) and (e), respectively, 7 CFR 3430.604(b) provides that awards for those components of the BFRDP may be made as either grants or cooperative agreements. Per 7 CFR 3430.2, NIFA defines a grant as “the award by the Authorized Departmental Officer of funds to an eligible grantee to assist in meeting the costs of conducting for the benefit of the public, an identified project which is intended and designed to accomplish the purpose of the program as identified in the program solicitation or RFA” and a cooperative agreement as “the award by the Authorized Departmental Officer of funds to an eligible awardee to assist in meeting the costs of conducting for the benefit of the public, an identified project which is intended and designed to accomplish the purpose of the program as identified in the program solicitation or RFA, and where substantial involvement is expected between NIFA and the awardee when carrying out the activity contemplated in the agreement.” The award types for those projects will depend on whether substantial involvement is expected.

7 CFR 3430.606(a)—Matching Requirements—Requirement

NSAC urged NIFA “to clarify in the final rule that for the portion of any match that is cash, it does not require that the cash be in hand, provided the applicant provides sufficient information demonstrating that the funding will be available before the time it is needed for expenditure in the project.” NSAC commented further that “requiring that cash be in hand at the time a BFRDP application is submitted is a substantial barrier for smaller community-based and non-profit organizations.” NIFA is not revising this section as the standards for meeting the matching requirements are found in the USDA uniform assistance regulations (7 CFR parts 3016 and 3019) and in the applicable RFAs.

7 CFR 3430.608(a)—Review Criteria—Evaluation Criteria

NSAC had comments on four of the six evaluation criteria under this section. They had no comments on criterion (2), technical merit, and criterion (3), achievability. Under criterion (1), relevancy, NSAC felt that language should be added “to the rule that clarifies that `relevancy' includes due consideration of at least three major factors: (1) Creating the maximum number of enduring beginning farmer and rancher opportunities, (2) ensuring that the enduring opportunities being created are economically viable, environmentally-sound, and help create an enhanced quality of life for the farm family and the community, (3) creating farming opportunities that do not diminish farming opportunities for others.” NIFA does not concur with this recommendation. NIFA concludes that relevancy addresses critical barriers faced by beginning farmers and ranchers.

Under criterion (4), the expertise and track record of one or more of the applicants, NSAC urged NIFA to “clarify in the rule that expertise be based on demonstrable and quantifiable factors such as the number of training, assistance, or education activities previously carried out, participants or graduates of the program and success rates, and the number of years a program or activity has been offered.” NIFA concurred with the recommendation. The recommendation of NSAC was included in the FY 2011 RFA.

Under criterion (5), the adequacy of plans for the participatory evaluation process, outcome-based reporting, and the communication of findings and results beyond the immediate target audience, NSAC comments that NIFA should help the grantees understand the criterion by providing in the definitions section examples of participatory evaluation, outcome-based reporting, and public communication. NSAC suggests that “outcome-based reporting be defined as outcomes and impacts rather than activities and inputs” and that “communicating findings include the expectation that grantees demonstrate how their communications plans reach beyond the immediate clientele to the larger arena of public stakeholders.” NIFA concurs with the recommendation regarding “outcome-based reporting” and has included the following definition under 7 CFR 3430.602: “Outcome-based reporting means reporting that includes an outcome statement with performance targets, necessary milestones, beneficiary engagement, key individuals, and verification.”

Under criterion (6), other appropriate factors, as determined by the Secretary, NSAC states that proposals should be “ranked higher if they show the degree and frequency of direct face-to-face work and interaction with actual constituencies served.” NIFA concurs with the recommendation. The recommendation of NSAC was included in the FY 2011 RFA.

7 CFR 3430.608(b)—Review Criteria—Partnership and Collaboration

To ensure that a real, demonstrable partnership exists, NSAC urges NIFA to require for projects in which the lead grantee is an eligible entity that is not a NGO or CBO, that the NGO or CBO not receive less than 25 percent collectively of the BFRDP funding awarded. NSAC believes that such a provision will “prevent partnership proposals from becoming partnership in name only.” NIFA concurs with the recommendation. The recommendation of NSAC has been included in the FY 2011 RFA.

7 CFR 3430.609(a)—Other Considerations—Set Aside

NSAC recommended that NIFA include a recommendation from the Conference Report accompanying the FCEA which encourages the Secretary to “include immigrant beginning farmers and ranchers in the funding set-aside for socially disadvantaged and limited resource farmers and ranchers.” NSAC urged NIFA to include this group in this section. NIFA concurs and has revised 7 CFR 3430.609(a) accordingly to include immigrant farm workers planning to become beginning farmers and ranchers.

NSAC had a second comment on this section. NSAC urged NIFA to require groups applying under the 25 percent set aside for limited resource beginning farmers and ranchers, socially disadvantaged beginning farmers and ranchers, and farm workers desiring to become farmers or ranchers, to demonstrate that at least 50.1 percent of the population served by the project be members of one or more of those three groups. NSAC urged NIFA to make this requirement part of the rule. NIFA does not concur with the recommendation from NSAC. NIFA has decided that the target audience need not be a specific group but can be open to all beginning farmers and ranchers so long as the program addresses the needs of one or more of those three groups.

7 CFR 3430.609(c)—Other Considerations—Duration

NSAC urged NIFA to apply the 3-year limit to the educational enhancement team project awards in addition to the standard BFRDP project awards. NIFA concurs with this recommendation and has revised 7 CFR 3430.609(c) accordingly to limit the term of the educational enhancement team project awards to three years.

7 CFR 3430.609(d)—Other Considerations—Amount of Grants

NSAC stated that the BRDFP legislative language clearly limits grants to no more than $250,000 per year and urged NIFA to clarify this in the final rule. In the interim rule, CSREES/NIFA decided to provide the maximum flexibility to the extent of the law for the awards made under the BFRDP authority in not subjecting the educational enhancement team projects to this limitation. However, based on the above comment, NIFA has revised 7 CFR 3430.609(d) to limit the educational enhancement team project awards to no more than $250,000 per year.

Additional Consideration—Regional Program Delivery

NSAC urged NIFA to “convene a short-duration stakeholder process to determine whether it would be advantageous to adopt a regional structure for BFRDP.” NSAC felt that a lot could be gained from a regional approach (i.e., “getting the program close to the ground as possible;” program would better reflect regional differences and priorities; the structure would allow for more expertise, ownership, and buy-in; and would allow for a more efficient use of resources). NIFA's response to NSAC is that there was not much support for regional program delivery at the first stakeholder meeting. If this program is reauthorized in the next Farm Bill, NIFA would consider revisiting the recommendation. There are a collection of projects that potentially could be strengthened through a regional structure at a later time.

Organization of 7 CFR Part 3430

A primary function of NIFA is the fair, effective, and efficient administration of Federal assistance programs implementing agricultural research, education, and extension programs. As noted above, NIFA has been delegated the authority to administer this program and will be issuing Federal assistance awards for funding made available for this program; and thus, awards made under this authority will be subject to the Agency's assistance regulations at 7 CFR part 3430, Competitive and Noncompetitive Non-formula Federal Assistance Programs—General Award Administrative Provisions. The Agency's development and publication of these regulations for its non-formula Federal assistance programs serve to enhance its accountability and to standardize procedures across the Federal assistance programs it administers while providing transparency to the public. NIFA published 7 CFR part 3430 with subparts A through F as an interim rule on August 1, 2008 [73 FR 44897-44909], and as a final rule on September 4, 2009 [74 FR 45736-45752]. These regulations apply to all Federal assistance programs administered by NIFA except for the formula grant programs identified in 7 CFR 3430.1(f), the Small Business Innovation Research programs with implementing regulations at 7 CFR part 3403 and the Veterinary Medicine Loan Repayment Program (VMLRP), authorized under section 1415A of the National Agricultural Research, Extension, and Teaching Policy Act of 1977 (NARETPA) with implementing regulations at 7 CFR part 3431.

NIFA organized the regulation as follows: Subparts A through E provide administrative provisions for all competitive and noncompetitive non-formula Federal assistance awards. Subparts F and thereafter apply to specific NIFA programs.

NIFA is, to the extent practical, using the following subpart template for each program authority: (1) Applicability of regulations, (2) purpose, (3) definitions (those in addition to or different from § 3430.2), (4) eligibility, (5) project types and priorities, (6) funding restrictions, and (7) matching requirements. Subparts F and thereafter contain the above seven components in this order. Additional sections may be added for a specific program if there are additional requirements or a need for additional rules for the program (e.g., additional reporting requirements).

Through this rulemaking, NIFA is adding subpart J for the administrative provisions that are specific to the BFRDP.

II. Administrative Requirements for the Final Rulemaking

Executive Order 12866

This action has been determined to be not significant for purposes of Executive Order 12866, and therefore, has not been formally reviewed by the Office of Management and Budget. This final rule will not create a serious inconsistency or otherwise interfere with an action taken or planned by another agency; nor will it materially alter the budgetary impact of entitlements, grants, user fees, or loan programs; nor will it have an annual effect on the economy of $100 million or more; nor will it adversely affect the economy, a sector of the economy, productivity, competition, jobs, the environment, public health or safety, or State, local or Tribal governments or communities in a material way. Furthermore, it does not raise a novel legal or policy issue arising out of legal mandates, the President's priorities or principles set forth in the Executive Order.

Regulatory Flexibility Act of 1980

This final rule has been reviewed in accordance with the Regulatory Flexibility Act of 1980, as amended by the Small Business Regulatory Enforcement Fairness Act of 1996, 5 U.S.C. 601-612. The Department concluded that the rule will not have a significant economic impact on a substantial number of small entities. The rule does not involve regulatory and informational requirements regarding businesses, organizations, and governmental jurisdictions subject to regulation.

Paperwork Reduction Act (PRA)

The Department certifies that this final rule has been assessed in accordance with the requirements of the Paperwork Reduction Act, 44 U.S.C. 3501 et seq. (PRA). The Department concludes that this final rule does not impose any new information requirements; however, the burden estimates will increase for existing approved information collections associated with this rule due to additional applicants.

These estimates have been provided to OMB. In addition to the SF-424 form families (i.e., Research and Related and Mandatory), and SF-425, Federal Financial Reports; NIFA has three currently approved OMB information collections associated with this rulemaking: OMB Information Collection No. 0524-0042, NIFA Current Research Information System (CRIS); No. 0524-0041, NIFA Application Review Process; and No. 0524-0026, Organizational Information.

Catalog of Federal Domestic Assistance

This final regulation applies to the Federal assistance program administered by NIFA under the Catalog of Federal Domestic Assistance (CFDA) No. 10.311, Beginning Farmer and Rancher Development Program.

Unfunded Mandates Reform Act of 1995 and Executive Order 13132

The Department has reviewed this final rule in accordance with the requirements of Executive Order No. 13132 and the Unfunded Mandates Reform Act of 1995, 2 U.S.C. 1501 et seq., and has found no potential or substantial direct effects on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government. As there is no Federal mandate contained herein that could result in increased expenditures by State, local, or Tribal governments, or by the private sector, the Department has not prepared a budgetary impact statement.

Executive Order 13175: Consultation and Coordination With Indian Tribal Governments

The Department has reviewed this final rule in accordance with Executive Order 13175, and has determined that it does not have “Tribal implications”. The final rule does not “have substantial direct effects on one or more Indian Tribes, on the relationship between the Federal Government and Indian Tribes, or on the distribution of power and responsibilities between the Federal Government and Indian Tribes”.

Clarity of This Regulation

Executive Order 12866 and the President's Memorandum of June 1, 1998, require each agency to write all rules in plain language. The Department invites comments on how to make this final rule easier to understand.

List of Subjects in 7 CFR Part 3430

• Administrative practice and procedure
• Agricultural research
• Education
• Extension
• Federal assistance

Accordingly, the interim rule amending 7 CFR part 3430 which was published at 74 FR 45968 on September 4, 2009, is adopted as a final rule with the following changes:

PART 3430—COMPETITIVE AND NONCOMPETITIVE NON-FORMULA FEDERAL ASSISTANCE PROGRAMS—GENERAL AWARD ADMINISTRATIVE PROVISIONS

1. The authority citation for part 3430 continues to read as follows:

Authority: 7 U.S.C. 3316; Pub. L. 106-107 (31 U.S.C. 6101 note).

2. Amend § 3430.602 by adding a definition of “Outcome-based reporting” to read as follows:

§ 3430.602

Definitions.

* * * * *

Outcome-based reporting means reporting that includes an outcome statement with performance targets, necessary milestones, beneficiary engagement, key individuals, and verification.

3. Amend § 3430.604 as follows:

a. Revise paragraph (a)(19); and

b. Add new paragraphs (a)(20) and (a)(21), to read as follows:

§ 3430.604

Project types and priorities.

(a) * * *

(19) Tax management, including record keeping and tax form preparation.

(20) Basic agricultural law.

(21) Other similar subject areas of use to beginning farmers or ranchers.

* * * * *

4. Amend § 3430.609 by revising paragraphs (a)(3), (c), and (d), to read as follows:

§ 3430.609

Other considerations.

(a) * * *

(3) Farm workers (including immigrant farm workers) desiring to become farmers or ranchers.

* * * * *

(c) Duration of awards. The term of a grant for a standard BFRDP project and an award for an educational enhancement team project under this subpart shall not exceed 3 years. Awards for all other projects under this subpart shall not exceed 5 years. No-cost extensions of time beyond the maximum award terms will not be considered or granted.

(d) Amount of grants. A grant for a standard BFRDP project and an award for an educational enhancement team project under this subpart shall not be in an amount that is more than $250,000 for each year.

Signed at Washington, DC, on June 10, 2011.

Ralph Otto,

Deputy Director, Food and Community Resources, National Institute of Food and Agriculture.