Wednesday, 

October 27, 2010 

Part III 

Department of 

Agriculture 

Commodity Credit Corporation 

7 CFR Part 1450 

Biomass Crop Assistance Program; Final 

Rule 


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66202 Federal Register / Vol. 75, No. 207 / Wednesday, October 27, 2010 / Rules and Regulations 

DEPARTMENT OF AGRICULTURE 

Commodity Credit Corporation 

7 CFR Part 1450 

RIN 0560–AH92 

Biomass Crop Assistance Program 

AGENCY: Commodity Credit Corporation 

and Farm Service Agency, USDA. 

ACTION: Final rule. 

SUMMARY: This rule implements the new 

Biomass Crop Assistance Program 

(BCAP) authorized by the Food, 

Conservation, and Energy Act of 2008 

(the 2008 Farm Bill). BCAP is intended 

to assist agricultural and forest land 

owners and operators with the 

establishment and production of eligible 

crops in selected project areas for 

conversion to bioenergy, and the 

collection, harvest, storage, and 

transportation of eligible material for 

use in a biomass conversion facility. 

This rule specifies the requirements for 

eligible producers and participants, 

biomass conversion facilities, and 

eligible renewable biomass crops and 

materials. 

DATES: Effective Date: October 27, 2010. 

FOR FURTHER INFORMATION CONTACT: 

Martin Lowenfish, U.S. Department of 

Agriculture (USDA), Farm Service 

Agency (FSA), Conservation and 

Environmental Programs Division, Mail 

Stop 0513, 1400 Independence Ave., 

SW., Washington, DC 20250–0513; 

telephone 202–205–9804; Persons with 

disabilities who require alternative 

means for communication (Braille, large 

print, audiotape, etc.) should contact the 

USDA Target Center at 202–720–2600 

(voice and TDD). 

SUPPLEMENTARY INFORMATION: 

Background 

In 2005, Congress enacted the 

Renewable Fuel Standard that requires 

7.5 billion gallons of corn starch ethanol 

in the national fuel supply by 2012. In 

2008, Congress revised these goals by 

requiring 36 billion gallons of advanced 

biofuels in our national fuel pool by the 

year 2022. At present, stakeholders have 

far exceeded the earlier Congressional 

goals, producing approximately 10 

billion gallons of corn starch ethanol at 

present, but the affordable production of 

next-generation advanced biofuels has 

not yet kept pace with the revised 

targets. These next-generation fuels 

require next-generation crops, and these 

unconventional crops typically require 

several years to become established. 

This is the principal goal of BCAP. 

BCAP is a primary component of the 

domestic agriculture, energy, and 

environmental strategy to reduce U.S. 

reliance on foreign oil, improve 

domestic energy security, reduce carbon 

pollution, and spur rural economic 

development and job creation. While 

there are many complexities in the 

development of a national strategy for 

biofuels—the pursuit of more 

economical conversion technologies, 

transportation infrastructure upgrades, 

expanded and affordable consumer 

access, financial risk mitigation tools— 

the success of all of these efforts 

ultimately must rest upon a foundation 

of a strong biomass feedstock source. 

The creation of that source, however, 

faces the classic chicken-and-egg 

challenge. An established, large-scale 

energy crop source must exist if 

commercial-scale biomass facilities are 

to have sufficient feedstock supplies. 

Conversely, a strong consumer base to 

purchase the crop must exist if 

profitable feedstock production is to 

occur. Also just as many such crop 

types need several years to become 

established, many promising biomass 

conversion technologies require similar 

time before proceeding to commercial 

scale. BCAP is designed to serve as 

catalyst to unite these multiple 

dynamics. By providing risk mitigation 

and production incentives, BCAP will 

encourage landowners to consider 

switching from familiar, revenuegenerating crops to new, 

unconventional, non-food, non-feed 

crops that must be ready for a nascent 

marketplace. 

Because BCAP is a voluntary program, 

its enrollment requirements cannot have 

such hurdles beyond standard practice 

so that interested participants would not 

instead choose to remain in 

conventional crop production. While 

BCAP is fundamentally a crop 

cultivation program, other 

considerations such as wildlife and 

conservation protection are nevertheless 

important parts of BCAP. 

As BCAP is implemented, the public 

debate will continue on what may be 

the best approach for meeting our 

national energy strategy. There are no 

perfect solutions in the pursuit of these 

goals, no single feedstock that offers the 

affordability, reliability, regionality, and 

sensitivity to the environment, and 

transportability, in equal ways. It is not 

the feedstock, nor the technology, but 

the ability of both to meet the standards 

of our national strategy that is 

paramount. And as we pursue the best 

course of action for energy 

independence and environmental 

improvement, actions must begin today 

to forge a new path forward, 

accompanied by concurrent 

preparations for second and third 

generation choices built upon the 

experiences of the first-generation 

achievements in the cultivation of 

biomass crops. 

Section 9001 of the 2008 Farm Bill 

(Pub. L. 110–246) authorizes BCAP to 

assist agricultural and forest land 

owners and operators with the 

collection, harvest, storage, and 

transportation of eligible material for 

use in a biomass conversion facility and 

to support the establishment and 

production of eligible crops for 

conversion to bioenergy in selected 

project areas. The 2008 Farm Bill 

authorizes such sums as are necessary to 

carry out BCAP. However, the 2010 

Supplemental Appropriations Act (Pub. 

L. 111–212) limited BCAP funding to 

$552 million in fiscal year 2010 and 

$432 million in fiscal year 2011. This 

final rule, which implements BCAP, 

reflects comments received on previous 

notices and on a proposed rule, as 

described below. FSA will administer 

this program on behalf of the 

Commodity Credit Corporation (CCC). 

On May 5, 2009, President Barack 

Obama issued a Presidential directive 

establishing a Biofuels Interagency 

Working Group, chaired by the 

Secretaries of Agriculture and Energy 

and the Administrator of the 

Environmental Protection Agency. 

Among other goals, the Presidential 

directive laid the groundwork for a 

policy development process that would 

aggressively accelerate the development 

of advanced biofuels (published in the 

Federal Register on May 7, 2009 (74 FR 

21531–21532)). One aspect of the larger 

effort outlined in the directive was the 

issuance of guidance and support 

related to the collection, harvest, 

storage, and transportation of eligible 

materials for use in biomass conversion 

facilities—a component of BCAP. 

On June 11, 2009 (74 FR 27767– 

27772), CCC published a BCAP notice of 

funds availability (NOFA) in the 

Federal Register for the collection, 

harvest, storage, and transportation of 

eligible materials. On February 8, 2010, 

(75 FR 6264–6288), CCC published the 

BCAP proposed rule. The proposed rule 

terminated the BCAP NOFA. 

FSA also held a series of public 

meetings, as described in the notice 

published on May 13, 2009 (74 FR 

22510–22511) and solicited comments, 

to collect public input needed to 

prepare an environmental impact 

statement (EIS) for BCAP. Specifically, 

CCC published four specific National 

Environmental Policy Act (NEPA)- 

related notices on BCAP in the Federal 

Register. A notice of intent (NOI) to 

prepare a programmatic EIS (PEIS) was 

published on October 1, 2008 (73 FR 


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57047–57048) to solicit public input on 

program implementation alternatives to 

be analyzed in the document; 

approximately 100 comments were 

received. CCC published an amended 

NOI on May 13, 2009 that identified the 

alternatives to be analyzed in the PEIS 

based on the input received on the 

previous NOI and announced six public 

scoping meetings around the country 

that began on May 29, 2009, and ended 

on June 11, 2009. CCC published a 

notice of availability of the draft PEIS on 

August 10, 2009 (74 FR 39915) or a 30- 

day public comment period; over 600 

comments were received from 

environmental groups, Federal agencies, 

organizations, and the general public. 

The Environmental Protection Agency 

announced the availability of the final 

EIS on June 25, 2010 (75 FR 36386– 

36387) for public comment. 

Comments from the public meetings 

and BCAP environmental notices were 

reflected in the BCAP proposed rule and 

in this final rule. 

The BCAP proposed rule and this 

final rule cover the whole BCAP, 

including both the provisions that 

provide matching payments for 

collection, harvest, storage, and 

transportation of materials and the 

provisions that provide payment for the 

establishment and production of 

biomass crops in selected project areas. 

The core structure and purposes of 

BCAP in this final rule are largely 

unchanged from those stated in the 

proposed rule. In response to comments 

received on the proposed rule, this final 

rule makes minor amendments to BCAP, 

as it was described in the proposed rule. 

This rule clarifies definitions and 

eligibility requirements and adds new 

provisions to enhance program integrity. 

Specific changes include: 

• Biomass conversion facilities will 

be required to certify that eligible 

materials that are not crop residues are 

byproducts of preventative treatments 

that are removed to reduce hazardous 

fuels, to reduce or contain disease or 

insect infestation, or to restore 

ecosystem health. 

• Related party transactions may be 

eligible for matching payments. 

• Biomass conversion facilities will 

be required to treat all parties equally 

and pay fair market rates; this is 

intended to prevent biomass conversion 

facilities from paying different prices 

based on whether a person is receiving 

BCAP payments or not. 

• BCAP requires a conservation plan, 

forest stewardship plan, or equivalent 

plan as an eligibility requirement to 

receive matching payments. Equivalent 

plans were previously included in some 

but not all references to plans in the 

proposed rule. In the proposed rule, 

compliance with existing plans was 

required for matching payments; 

however, a plan was not required if one 

did not already exist. Now conservation 

plan, forest stewardship plan, or 

equivalent plans are required for all 

BCAP payments. 

• As specified in the 2008 Farm Bill, 

BCAP participants may receive 

matching payments for a maximum of 2 

years; this rule specifies that CCC will 

take into account the NOFA period in 

an equitable manner consistent with the 

2008 Farm Bill. 

• Although, the proposed rule 

provided alternatives for different 

payment rates based on type of material, 

BCAP will provide a single rate of $1 for 

each $1 per dry ton provided by the 

biomass conversion facility, up to $45 

per dry ton, with no ‘‘tiered’’ payments 

for different types of biomass. Similarly, 

provisions in the proposed rule for 

payments for wood wastes and wood 

residues converted to heat or power 

only above historical usage baselines 

cannot be implemented. 

• This rule clarifies that to qualify for 

payment, that eligible materials and 

renewable biomass must be organic 

materials that are harvested or collected 

from the land, which was in the 

proposed rule. Specific references to 

vegetative and woody waste products 

that would not meet those requirements 

are not included. This rule clarifies the 

section on eligible materials to include 

specific requirements that are also 

clearly defined in the definitions 

section. 

• Reductions to annual payments for 

sale of eligible crops and materials will 

be tiered based on the use for which the 

material or crops from the contract acres 

was sold and matching payments were 

paid. Conversion to advanced biofuels 

will result in the smallest reduction, 

while uses for purposes other than 

conversion to heat, power, biobased 

products, or advanced biofuels will 

result in the highest reduction. 

• This rule also makes technical 

corrections and editorial changes that 

reflect both comments received and 

FSA’s review of the rule. 

This document describes BCAP in 

detail, then provides a detailed 

discussion of comments received on the 

proposed rule and FSA’s response to 

those comments, and then a list of 

specific section-by-section changes 

made to the regulatory provisions in 

response to the comments received. 

BCAP Overview 

BCAP supports two main types of 

activities. First, it provides funding for 

agricultural and forest land owners and 

operators to receive matching payments 

for certain eligible material sold to 

qualified biomass conversion facilities 

for conversion to heat, power, biobased 

products, or advanced biofuels. These 

payments are referred to as ‘‘matching 

payments.’’ Matching payments will 

assist producers with the cost of 

collection, harvest, storage, and 

transportation of certain eligible 

material to a qualified biomass 

conversion facility. Such payments to a 

particular participant can continue for 

up to 2 years after the first payment is 

issued. Second, BCAP provides funding 

for producers of eligible crops of 

renewable biomass within specified 

project areas to receive establishment 

payments of not more than 75 percent 

of the cost of establishment of eligible 

woody and non-woody perennial crops, 

and annual payments for up to 5 years 

for the production of eligible annual and 

non-woody perennial renewable 

biomass crops and for up to 15 years for 

the production of eligible woody 

perennial renewable biomass crops. 

These are referred to as ‘‘establishment 

payments and annual payments,’’ 

respectively. To be eligible for payment, 

the establishment and production 

activities must take place in designated 

project areas, which may be proposed to 

CCC by biomass conversion facilities or 

by groups of producers. Producers in 

project areas may be eligible for both 

types of payments; producers outside 

the project areas are only eligible for 

matching payments. A table is provided 

later in this document summarizing the 

major eligibility requirements for both 

types of payments. 

Definitions and Terms Used in This 

Rule 

As defined in this rule, ‘‘advanced 

biofuel’’ means fuel derived from 

renewable biomass other than corn 

kernel starch, including biofuels derived 

from cellulose, hemicellulose, or lignin; 

biofuels derived from sugar and starch 

(other than ethanol derived from corn 

kernel starch); biofuel derived from 

waste material, including crop residue, 

other vegetative waste material, animal 

waste, food waste, and yard waste; 

diesel-equivalent fuel derived from 

renewable biomass including vegetable 

oil and animal fat; biogas (including 

landfill gas and sewage waste treatment 

gas) produced through the conversion of 

organic matter from renewable biomass; 

and butanol or other alcohols produced 

through the conversion of organic 

matter from renewable biomass and 

other fuel derived from cellulosic 

biomass. That definition, which is 

specified in the 2008 Farm Bill, did not 

change from the proposed rule. 


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To be considered a qualified biomass 

conversion facility, one of the activities 

that meets the criteria for qualification 

is converting eligible renewable biomass 

material to a biobased product. The 

2008 Farm Bill defined biobased 

products as a product determined by the 

Secretary to be a commercial or 

industrial product (other than food or 

feed) that is—‘‘(A) composed, in whole 

or in significant part, of biological 

products, including renewable domestic 

agricultural materials and forestry 

materials; or (B) an intermediate 

ingredient or feedstock.’’ CCC will 

administer BCAP consistent with 

USDA’s standards for biobased products 

specified in the BioPreferred 

Procurement Program, which 

establishes a minimum biobased content 

for specific items and generic groupings 

of biobased products and excludes 

certain biobased products including (1) 

motor vehicle fuels (biofuels) and 

electricity (heat and power); and (2) 

products with significant national 

market penetration as of 1972 (7 CFR 

2902.5(c)). 

This final rule also adds a definition 

of ‘‘biofuel’’ to mean ‘‘a fuel derived from 

renewable biomass.’’ Corn ethanol 

would be included in the definition of 

biofuel, but not the definition of 

advanced biofuel. 

This rule uses the terms ‘‘contract 

acreage’’ and ‘‘contract acres’’ to mean 

land that is eligible for establishment 

payments and annual payments under 

Subpart C of the regulation. Some 

eligible materials only qualify for 

matching payments under Subpart B if 

they are grown on contract acres. 

This rule uses the term ‘‘eligible 

material’’ for renewable biomass that 

may qualify for the matching payment 

component of BCAP and ‘‘eligible crop’’ 

for renewable biomass that may be 

eligible for the establishment payments 

and annual payments component of 

BCAP. The 2008 Farm Bill uses these 

two terms in this way and defines them 

as including different kinds of 

renewable biomass. 

The purpose of this regulation is to 

provide incentives for the cultivation of 

new biomass for new markets rather 

than divert biomass from existing 

markets. This rule clarifies the 

definition of ‘‘higher-value product’’ as 

an existing market product that is 

comprised principally of an eligible 

material or materials and, in some 

distinct local regions outside of project 

areas, as determined by CCC, has an 

existing market as of the date of 

publication of this rule in the Federal 

Register. Higher-value products may 

include, but are not limited to, products 

such as mulch, fiberboard, nursery 

media, lumber, or paper, or a product 

manufactured from eligible materials 

from which eligible materials must be 

separated in order to be used for heat, 

power, biobased products, or advanced 

biofuels. Eligible materials that are 

considered to be used for a higher value 

product may differ according to region 

and may qualify for matching payments 

if no higher value product market exists 

in that region. Higher-value products 

may include products such as mulch, 

fiberboard, nursery media, lumber, 

paper, or other materials. 

As specified in the 2008 Farm Bill 

and in this rule, the eligible material 

owner may be a person or legal entity 

who is (1) a producer of an eligible crop 

or (2) has the right to collect or harvest 

eligible material. A qualified biomass 

conversion facility that meets those 

requirements may be an eligible 

material owner and receive BCAP 

payments under subpart B of the 

regulation. 

The term ‘‘conservation district’’ is 

used as defined in 7 CFR part 1410, the 

regulations for the Conservation Reserve 

Program (CRP). 

This rule uses the term ‘‘participant’’ 

for the matching payments component 

of BCAP and the terms ‘‘producer’’ and 

‘‘participant’’ for the establishment 

payments and annual payments 

component of BCAP. The distinction is 

an eligible participant for matching 

payments is not necessarily the person 

or legal entity who produced the 

material but may be the person who 

owns it or has the authority to collect or 

harvest and sell it to the biomass 

conversion facility. However, in all 

cases there may only be one BCAP 

payment made for any base material and 

the person claiming the BCAP payment 

must be the person who was entitled to 

receive and negotiate the payment being 

matched. In other words, all BCAP 

producers are participants, but not all 

BCAP participants are producers. 

Participants are those individuals or 

entities who have been approved and 

are bound to perform under a contract 

for matching payments, establishment 

payments, or annual payments. The 

term ‘‘producer’’ means either an owner 

or operator of BCAP project acreage that 

is physically located in a BCAP project 

area, or a producer of an eligible crop 

produced on that acreage. 

This rule uses the term ‘‘contract’’ and 

‘‘agreement.’’ A contract is between CCC 

and the participant for BCAP payments. 

The contract is legally binding on the 

participants in BCAP and specifies what 

the producer must do and the resulting 

payments that CCC will make to the 

producer or other BCAP participant 

entitled to receive a payment. An 

‘‘agreement’’ is between CCC and a 

qualified biomass conversion facility or 

a project area sponsor. The agreement 

specifies what the qualified biomass 

conversion facility or the project area 

sponsor plans to do and how it will 

support the establishment and 

production of eligible crops for 

conversion to bioenergy in the BCAP 

project areas including the type of 

renewable biomass that will be used and 

the planned conversion methods of 

renewable biomass. In addition, there 

may be agreements between CCC and a 

qualified biomass conversion facility for 

the matching payments, which include 

items such as obligations of the facility 

to provide a purchase list, receipts and 

scale tickets for the eligible material 

owners and agreement to provide 

facility address and contact information 

to the general public. 

Matching Payments 

Matching payments will be available 

for the delivery of certain eligible 

material to qualified biomass conversion 

facilities to a producer of an eligible 

crop or a person with the right to collect 

or harvest eligible material. 

The 2008 Farm Bill provides for 

matching payments at a rate of $1 for 

each $1 per dry ton paid by the 

qualified biomass conversion facility, in 

an amount up to $45 per dry ton, for a 

period of 2 years. The 2008 Farm Bill 

also provides that biomass conversion 

facilities are those that convert, or 

propose to convert, renewable biomass 

into heat, power biobased products, or 

advanced biofuels. 

For the matching payment 

calculations, CCC proposed three 

options. As discussed in the Summary 

of Comments section below, after 

consideration of comments received, an 

amended version of the first option was 

selected, and is the one specified in this 

final rule. 

CCC will provide matching payments 

at the rate of $1 for each $1 per dry ton 

paid by the qualified biomass 

conversion facility to the eligible 

material owner for delivery of eligible 

material that qualify for payment to the 

facility in an amount not to exceed $45 

per dry ton. Participants will be eligible 

for payments for a period of 2 years 

beginning from the date of their first 

matching payment is made after the 

effective date of this rule. CCC will 

determine how to take into account 

participation in the NOFA period. At 

the least, the 2-year period will be 

considered stopped during the period 

between the end of matching payments 

received during the operation of the 

NOFA and the beginning of CCC 

matching payments for new deliveries 


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by the participant. If title to the material 

from a particular farm or locale is 

transferred to another party, the rule 

provides that the successor is subject to 

the 2-year requirement applicable to the 

previous participation at that locale. 

Otherwise, the 2-year requirement could 

be easily avoided contrary to the 2008 

Farm Bill. Generally, however, the 2- 

year period is producer specific. If, for 

example, the producer changes delivery 

points after a year, the time period does 

not start anew. 

Qualified Biomass Conversion Facility 

In order for a delivery of eligible 

materials to a biomass conversion 

facility to qualify for a BCAP payment, 

the receiving biomass conversion 

facility must be qualified for BCAP. To 

become qualified, the biomass 

conversion facility must enter into an 

agreement with CCC, through the FSA 

State office in the State where the 

facility is physically located. 

For BCAP, a biomass conversion 

facility is a facility that converts or 

proposes to convert renewable biomass 

into heat, power, biobased products, or 

advanced biofuels. For the purposes of 

BCAP, advanced biofuels do not include 

ethanol derived from corn kernel starch, 

because the 2008 Farm Bill specifically 

excludes it. 

A biomass conversion facility does 

not have to be a project sponsor for the 

establishment payment and annual 

payment component of BCAP or be in 

operation to submit a successful 

application for qualification. For any 

facility, whether or not yet in operation, 

the entity requesting that a facility 

become qualified must provide proof of 

all applicable Federal, State, local, and 

Tribal permits and licenses required for 

operation or proof of application 

completions or letters of renewal 

submissions from the applicable 

governmental entity. Applicable permits 

and licenses may include, but are not 

limited to, business licenses, air quality 

permits, water discharge permits, storm 

water permits, or Bureau of Alcohol, 

Tobacco, Firearms and Explosives 

registrations. 

Each biomass conversion facility must 

enter into a separate agreement with 

CCC regardless of whether a single 

owner has multiple facilities. CCC will 

issue a unique facility identification 

number to each qualifying biomass 

conversion facility. In addition, when a 

biomass conversion facility agrees to 

become ‘‘qualified,’’ CCC will make 

general contact information available to 

the public through FSA county offices 

and on the FSA Web site. 

Eligible Material Owners, Application 

for Matching Payments 

To be eligible for matching payments, 

the eligible material owner must apply 

at an FSA county office and receive 

approval for that application before 

delivering the eligible material to the 

qualified biomass conversion facility. 

The qualified biomass conversion 

facility must issue a receipt or invoice 

on the date of delivery to the eligible 

material owner. The receipt will be the 

basis for the matching payment 

calculation. 

The material owner will be eligible for 

the payment if the owner had the legal 

title to the material for collection or 

harvest, such as the operator or 

producer conducting farming operations 

on private land, or any other person 

designated by the owner of the private 

land. Consistent with the 2008 Farm 

Bill, the eligible material owner does 

not have to own the land where the 

eligible material was collected or 

harvested as a condition of eligibility. 

The eligible material owner may be a 

person with the right to collect or 

harvest eligible material, and who has 

the risk of loss with respect to that 

material, on certain Federal lands 

pursuant to a contract or permit with 

the U.S. Forest Service or Bureau of 

Land Management, such as a timber sale 

contract. 

Eligible material owners must submit 

the documentation from the qualified 

biomass conversion facility to the FSA 

county office to be eligible for matching 

payments. The measure for the eligible 

material weight is a ‘‘dry ton,’’ the 

weight at zero percent moisture content. 

The facility is required to have the 

necessary equipment (such as a 

moisture meter) to calculate the 

equivalent dry ton weight of the 

delivered material. 

Eligible material owners may also be 

eligible to participate under the 

‘‘establishment payments and annual 

payments’’ component of BCAP; 

however, eligible materials may differ 

from eligible crops and the annual 

payment that is received by a 

participant in that component will be 

reduced when a matching payment is 

issued. The ‘‘establishment payments 

and annual payments’’ component of 

BCAP is discussed later in this rule. If 

an eligible material owner or producer 

wishes to avoid the reduction in annual 

payment(s), the owner or producer must 

decline the matching payment(s). 

The NOFA imposed an ‘‘arm’s length 

transaction’’ requirement to be eligible 

for a matching payment. As discussed 

below in the Summary of Comments 

section, based on comments received, 

those provisions have been removed 

from this final rule. To achieve a fair 

price for all participants, provisions 

have been added requiring biomass 

conversion facilities to pay a fair market 

value to all participants, regardless of 

whether the participant is receiving 

BCAP payments or is a related party. 

An eligible material owner needs to 

meet the following requirements to be 

eligible for a matching payment: 

An eligible material owner must be 

one or more of the following: 

• A producer within a project area; or 

• A person or a non-Federal entity 

that has legal title to an eligible 

material, including Indian tribes and 

tribal members. 

An eligible material owner may 

request a matching payment at the FSA 

county office after being approved to 

participate in the program and after 

delivery of eligible material to a 

qualified biomass conversion facility 

and receiving payment for that delivery. 

However, eligible material owner(s) 

who meet the requirements listed above 

are not eligible for a matching payment 

if: 

• Delivery is made or payment 

received for delivery before the biomass 

conversion facility is qualified by CCC; 

• The eligible material owner did not 

receive approval from CCC to be 

considered an eligible material owner 

for matching payment from the FSA 

county office before delivery to the 

biomass conversion facility; 

• The delivery contained ineligible 

material (for deliveries of otherwise 

eligible material, none of the eligible 

material will qualify for payment if it 

must be separated from other material 

which may be the higher-value product 

after delivery to the biomass conversion 

facility); 

• The eligible material owner that 

collects or harvests the eligible material 

directly from the land sells the eligible 

material to any other entity other than 

the qualified biomass conversion 

facility; 

• The eligible material owner does 

not present proof of payment and proof 

of delivery date for delivery of the 

eligible material; 

• The eligible material was collected 

or harvested from the land not in 

accordance with the conservation plan, 

forest stewardship plan, or equivalent 

plan; 

• The eligible material produced 

outside a project area may be used to 

produce higher-value products; 

• The eligible material owner violates 

Executive Order 13112, ‘‘Invasive 

Species;’’ 

• The eligible material owner 

knowingly supplied false information; 


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• The eligible material owner violated 

the associated conservation, forestry, or 

equivalent plan related to the land that 

produced the eligible material for which 

a matching payment is requested; or 

• The formerly qualified biomass 

conversion facility failed to comply 

with the agreement it entered into with 

CCC and, accordingly, the agreement 

was terminated by CCC prior to 

delivery. 

Eligible Materials 

In general, eligible material is 

renewable biomass that qualifies for the 

matching payment component of BCAP. 

For guidance to potential eligible 

material owners and biomass 

conversion facilities, CCC will provide a 

chart of eligible materials that qualify 

for matching payments. The chart of 

eligible materials that qualify for 

matching payments will be provided to 

the public via the FSA Web site at 

http://www.fsa.usda.gov/energy; an 

example of the chart is included below. 

The chart is not exhaustive and will be 

periodically updated on the FSA Web 

site by CCC—in accordance with the 

parameters established by the 2008 

Farm Bill. Because the contents of the 

eligible material list that qualify for 

payments are expected to change 

periodically, the list is not included in 

the BCAP regulations. When there is 

recommendation for an addition to the 

list of eligible materials that qualify for 

payments, CCC will review the material 

to make determinations. The review 

may include a site visit and comparison 

to related materials or uses. CCC will 

review the recommendation to ensure 

that the new material meets the 

requirements of the 2008 Farm Bill and 

the provisions in this final rule. As 

described later in this rule, eligible 

crops for the establishment payments 

and annual payment provisions will 

include some additional crops not 

eligible for matching payments and 

therefore not considered to be eligible 

materials. 

CONDITIONS WHERE ELIGIBLE MATERIALS WILL QUALIFY FOR MATCHING PAYMENTS

Eligible material 

Qualifies for matching payment? 

If collected or harvested directly from the land 

before transport and delivery to the biomass 

conversion facility 

If collected or harvested by 

separation from a higher-value 

product collected or harvested 

directly from the land 

before transport and delivery to the biomass conversion facility after transport 

and delivery to 

the biomass 

conversion 

facility 

Forest thinnings ...................................................................... Y* ........................................................................ Y* N 

Post-disaster debris ................................................................ Y* ........................................................................ Y* N 

Hardwood chips ...................................................................... Y* ........................................................................ Y* N 

Softwood chips ....................................................................... Y* ........................................................................ Y* N 

Cutoffs ..................................................................................... Y* ........................................................................ Y* N 

Bark ......................................................................................... Y* ........................................................................ Y* N 

Trees and shrubs without timber, lumber or wood pulp value Y* ........................................................................ Y* N 

Trees and shrubs with timber, lumber or wood pulp value .... Y* non-Federal land (N Federal land) ................ N N 

Forbs such as sunflower and clover ...................................... Y* ........................................................................ Y* N 

Legumes ................................................................................. Y* ........................................................................ Y* N 

Non yard waste grasses ......................................................... Y* ........................................................................ Y* N 

Non yard waste vines ............................................................. Y* ........................................................................ Y* N 

Mosses .................................................................................... Y* ........................................................................ Y* N 

Crop residues, including Title I crop residues ........................ Y* ........................................................................ Y* N 

Corn cobs ............................................................................... Y* ........................................................................ Y* N 

Corn stover ............................................................................. Y* ........................................................................ Y* N 

Sugarcane bagasse ................................................................ Y* ........................................................................ Y* N 

Rice hulls ................................................................................ Y* ........................................................................ Y* N 

Nut hulls .................................................................................. Y* ........................................................................ Y* N 

Rice straw ............................................................................... Y* ........................................................................ Y* N 

Wheat straw ............................................................................ Y* ........................................................................ Y* N 

Orchard waste and vineyard waste ........................................ Y* ........................................................................ Y* N 

Excluded from eligibility: 

Title I crops ......................................................................

Algae ................................................................................

Animal waste and byproducts (including fats, oils, 

greases, and manure).

Food waste ......................................................................

Yard waste .......................................................................

‘‘Yes’’ means material has been collected or harvested directly from the land in compliance with an approved conservation plan, forest stewardship plan, or equivalent plan, and in compliance with that plan, and, that eligible materials that are not crop residues are byproducts of preventative treatments that are removed to reduce hazardous fuels, to reduce or contain disease or insect infestation, or to restore ecosystem 

health. 

*‘‘Yes’’ becomes ‘‘no’’ if CCC rules that, within that distinct local market, the product is being diverted from higher-value (existing) markets. 

There has been interest in and 

discussion about various materials and 

whether or not they are considered to be 

eligible materials and specifically 

whether they qualify to receive 

matching payments for BCAP. For 


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example bagasse, rice hulls, nut hulls, 

corn cobs, whole trees, bark, wood 

chips, sawdust, and black liquor. For 

some materials there is an important 

distinction as to whether they meet the 

basic definition of eligible material or 

whether they are a product versus a 

feedstock. A determination about 

whether a material qualifies for 

matching payments requires the item to 

be an eligible material and to meet the 

other requirements of the BCAP 

regulations, for example the collection, 

harvest, storage, transportation, and 

delivery requirements. Each of the 

example materials listed in this 

paragraph are discussed below. 

Bagasse has been discussed above. It 

is the fibrous residue that remains after 

sugarcane stalks are crushed, is an 

eligible material, but cannot qualify for 

matching payments because it is not 

collected directly from the land, but 

rather it is separated from a higher-value 

product, such as a Title I crop (sugar 

extraction) after delivery to the facility, 

cannot qualify for a matching payment. 

Hulls are eligible materials, but 

qualify for matching payments only if it 

is collected or harvested directly from 

the land, or separated from a highervalue product, in accordance with an 

approved conservation or equivalent 

plan, before delivery to a biomass 

conversion facility. Hulls separated 

from whole grain or nuts after delivery 

to the processing facility cannot qualify 

for a matching payment. Where they 

have not been separated by the farmer, 

the delivery of the hulls is merely 

incidental to the normal marketing of 

the crop. It is not a new collection or 

harvesting of the biomass at all. 

Changing practices to merely separate 

the hulls, for example, early (at the 

farm) will not, however lead to payment 

as that could itself be a scheme or 

device in violation of BCAP if the only 

purpose was to generate a BCAP 

payment. 

Corn cobs are crop residues, and are 

eligible materials, but qualify for 

matching payments only if they are 

collected or harvested directly from the 

land, or separated from a higher-value 

product, in accordance with an 

approved conservation plan or 

equivalent plan, before delivery to a 

biomass conversion facility. Cobs 

collected not directly from the land, but 

rather separated from a higher-value 

product, such as a Title I crop (corn 

kernels) after delivery to a biomass 

conversion facility, cannot qualify for a 

matching payment for the reason we 

give above. 

The same concerns apply with respect 

to forest matters. Under this rule, whole 

trees or logs are eligible materials that 

qualify for matching payments only if 

collected or harvested directly from the 

land, in accordance with an approved 

conservation plan, forest stewardship 

plan, or equivalent plan; are diseased, 

such as trees infested by the bark beetle; 

are byproducts of preventative 

treatments that are removed to reduce 

hazardous fuels; are removed to restore 

ecosystem health; and have not been 

determined by the CCC as a highervalue product in that market. The 

provisions of the 2008 Farm Bill 

provided for the preventative treatment 

qualification with respect to government 

land. However, that qualification is 

extended to trees or logs on private land 

in this rule so as, consistent with the 

2008 Farm Bill, to avoid undue 

disturbance of forest lands consistent 

with the positive environmental intent 

of BCAP and consistent with other 

determinations specified in this final 

rule. This also reflects the concept that 

BCAP is for the use of materials that 

would otherwise be waste materials and 

that would go uncollected or 

unharvested. It is not intended to upset 

existing market relationship. It is for 

these reasons, on consideration of the 

comments, and further consideration of 

the operation of the portion of BCAP 

under the NOFA, that CCC determined 

that it is appropriate to apply this 

qualification to trees or logs on private 

lands as well. 

Whole trees that CCC has determined 

have a higher value, such as for lumber 

or wood pulp, or have been removed 

without an approved forest stewardship 

plan or equivalent plan, cannot qualify 

for matching payments even if part of 

the tree is separated from the bulk of the 

tree and burned or otherwise used for 

biofuel—see the explanation given with 

respect to bagasse. 

Accordingly, under this rule, bark is 

an eligible material that qualifies for 

matching payments only if it is (1) 

collected or harvested directly from the 

land, in accordance with an approved 

conservation plan, forest stewardship 

plan, or equivalent plan, before delivery 

to a biomass conversion facility, (2) 

separated from a higher-value product, 

and (3) has not been determined by CCC 

as having a higher-value product in that 

local market. The applicable provisions 

of the 2008 Farm Bill relative to the 

third of these qualifications are 

designed to generate new activities that 

will create biomass and not disturb 

existing markets that rely on biomass 

and may have beneficial effects of their 

own—such as the use of bark for mulch. 

This follows that view to assure a 

genuine biomass oriented collection and 

harvesting (one that would otherwise 

not occur) and also serves to assure that 

BCAP stays within the dollar limits set 

by Congress. If CCC determines that in 

a distinct local market, the bark is used 

for mulch, or nursery media, the bark 

will not qualify for matching payments 

in that market. Bark collected from 

processed trees after the trees are 

delivered to pulp and paper facilities 

cannot qualify for matching payments. 

Wood chips are eligible materials that 

qualify for matching payments only if 

collected or harvested directly from the 

land, or separated from a higher-value 

product, in accordance with an 

approved conservation plan, forest 

stewardship plan, or equivalent plan, 

before delivery to a biomass conversion 

facility, and have not been determined 

by CCC as a higher-value product in that 

local market. If CCC determines that in 

distinct local markets, the wood chips 

are used for products such as particle 

board, the chips cannot qualify for 

matching payments in that market. 

Chips collected from delivered and 

processed trees after the trees are 

delivered to pulp and paper facilities 

cannot qualify for matching payments. 

Chips created in the field from diseased 

trees for ease of transport of that 

biomass to a conversion facility qualify 

for matching payments. 

Sawdust is an eligible material that 

qualifies for matching payments only if 

it is (1) collected or harvested directly 

from the land, in accordance with an 

approved conservation plan, forest 

stewardship plan, or equivalent plan, 

before delivery to a biomass conversion 

facility, (2) separated from a highervalue product, and (3) has not been 

determined by CCC as having a highervalue product in that local market. 

Sawdust collected from processed trees 

after the trees are delivered to a wood 

products facility cannot qualify for 

matching payments under this rule. 

Sawdust collected directly from the 

forestland before delivery to a facility 

may qualify for matching payments. If 

CCC determines that in distinct local 

markets, the sawdust can be used for 

higher-value products such as particle 

board, the sawdust cannot qualify for 

matching payments in that market. 

Black liquor, or pulp liquor, is an 

aqueous waste by-product of the kraft 

process of pulp manufacturing that is 

comprised of lignin, hemicellulose, and 

inorganic chemicals and used as fuel at 

these facilities. Any eligible material 

used in the manufacturing process that 

can be attributed to the creation of black 

liquor cannot qualify for matching 

payment because the eligible materials 

(non-Federal pulpwood trees) 

immediate, principal higher-value 

purpose is wood pulp for paper 

manufacturing and the creation of the 


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black liquor is a byproduct of the 

production process. 

Renewable biomass, as specified in 

the 2008 Farm Bill and in this rule, 

includes materials, pre-commercial 

thinnings, or invasive species from U.S. 

National Forest System land and U.S. 

Bureau of Land Management (BLM) 

land that: 

• Are byproducts of preventive 

treatments that are removed to reduce 

hazardous fuels, to reduce or contain 

disease or insect infestation, or to 

restore ecosystem health; 

• Would not otherwise be used for 

higher-value products; and 

• Are harvested in accordance with 

applicable law and land management 

plans and the requirements for oldgrowth maintenance, restoration, and 

management direction of subsections 

102(e)(2), (3), and (4) of the Healthy 

Forests Restoration Act of 2003 (16 

U.S.C. 6512) and large-tree retention 

provisions of subsection (f). 

In other words, renewable biomass 

harvested on National Forest System 

and BLM land would be biomass 

removed for fire prevention purposes, 

biomass unsuitable for commercial 

timber harvest, invasive plant removal 

for treatment and control purposes, and 

diseased, damaged, or immature 

biomass culled in accordance with 

appropriate forest management 

practices. As discussed below in the 

Summary of Comments section, in 

response to the comments, this rule 

requires a conservation plan, forest 

stewardship plan, or equivalent plan for 

all eligible materials that qualify for 

payment. 

As specified in the 2008 Farm Bill, 

renewable biomass also includes 

organic matter that is available on a 

renewable or recurring basis from nonFederal land or land belonging to an 

Indian or Indian Tribe that is held in 

trust by the United States including: 

• Renewable plant materials such as 

feed grains, other agricultural 

commodities, other plants and trees, 

and algae; and 

• Waste material, including crop 

residue, other vegetative waste material, 

including wood waste and wood 

residues, animal waste and byproducts, 

including fats, oils, greases, and 

manure, food waste, and yard waste. 

However, that definition of renewable 

biomass from the 2008 Farm Bill applies 

to more than one program in Title IX of 

the 2008 Farm Bill. For BCAP 

specifically, the 2008 Farm Bill defines 

‘‘eligible material’’ more narrowly, 

excluding any crop that is eligible to 

receive payments under Title I of the 

2008 Farm Bill. 

Crops that are eligible to receive 

payments under Title I of the 2008 Farm 

Bill would therefore not be included as 

eligible materials or crops for BCAP. 

Any crop that is eligible to receive 

payments under Title I of the 2008 Farm 

Bill or an amendment made by that Title 

includes a crop of barley, corn, grain 

sorghum, oats, rice, or wheat; honey; 

mohair; certain oilseeds such as canola, 

crambe, flaxseed, mustard seed, 

rapeseed, safflower seed, soybeans, 

sesame seed, and sunflower seeds; 

peanuts, pulse crops such as small 

chickpeas, lentils, and dry peas; dairy 

products; sugar; wool; and cotton boll 

fiber. 

In accordance with the 2008 Farm 

Bill, crop residue or other similar 

byproducts of crop production and 

harvesting, such as stover, straw, or 

hulls, are considered eligible materials 

that qualify for payments under subpart 

B of the regulation provided that they 

are collected, harvested, transported, 

and delivered as required by the 

regulation. For such eligible material to 

qualify for payment, conservation plans 

must be updated or created to address 

the removal of the material. 

The 2008 Farm Bill specifies that 

material removed from Federal land is 

not eligible if it would otherwise be 

used for higher-value products. Because 

the intent of BCAP is to spur new 

biomass for new markets rather than 

divert biomass from existing markets, 

and in response to comments, this rule 

extends the higher-value qualification to 

material from all land not under a BCAP 

contract (including non-Federal lands). 

The exemption for the BCAP contracts 

reflects that market displacement issues 

should be taken into account in the 

BCAP approval process. 

The 2008 Farm Bill does not 

specifically exclude invasive or noxious 

species in the definition of ‘‘eligible 

material’’ which is the key term for the 

matching payment part of BCAP. After 

consideration of this issue, those 

materials are eligible materials that 

qualify for payment if collected, 

harvested, stored, transported, and 

delivered as specified in all applicable 

local, State, and Federal requirements 

on invasive and noxious species. 

Accordingly, this rule includes 

invasive and noxious species as eligible 

materials that qualify for BCAP 

matching payment purposes; however, 

such eligible materials must be collected 

or harvested according to a new or 

amended conservation plan, forest 

stewardship plan, or equivalent plan 

and must not be collected, harvested, or 

transported during reproductive or other 

phases that may propagate the spread or 

establishment of those species. Eligible 

material owners must contact State and 

local weed boards or authorities and 

their local USDA Service Center staff 

about collecting, harvesting, storing, or 

transporting invasive or noxious species 

to ensure compliance with Executive 

Order 13112 (which addresses noxious 

weeds), USDA guidelines, and other 

requirements. Eligible material owners 

that violate Executive Order 13112 

while carrying out activities related to 

receiving a matching payment will be in 

violation of the BCAP regulations and 

will be required to return all matching 

payments, as determined by the Deputy 

Administrator. 

As required by the 2008 Farm Bill, the 

following materials are excluded from 

being considered eligible materials for 

BCAP, although they are eligible crops 

for BCAP establishment payments and 

annual payments: 

• Animal waste and byproducts 

(including fats, oils, greases, and 

manure); 

• Food waste such as food processing 

scraps and yard waste such as debris 

removal originating from municipal or 

commercial yard, lawns, landscaped 

areas or related sites; and 

• Algae. 

Consistent with the 2008 Farm Bill, 

this rule specifies that for eligible 

materials to qualify for a matching 

payment, they must be collected and 

harvested directly from lands including: 

(1) U.S. National Forest System lands; 

(2) BLM lands; 

(3) All Non-Federal lands in the 

United States; and 

(4) Land belonging to an Indian or 

Indian Tribe that is held in trust by the 

United States or subject to a restriction 

against alienation imposed by the 

United States. In other words, most 

publicly- and privately-held land is 

eligible to produce material for the 

BCAP matching payments program, 

except for certain Federal lands. 

In accordance with the 2008 Farm 

Bill, matching payments may be made 

for all eligible materials, including those 

derived outside BCAP project areas. 

Advanced biofuels and intermediate 

ingredients or feedstock are not 

collected or harvested directly from the 

land, therefore, they do not qualify to 

receive matching payments. CCC 

recognizes that the production of some 

advanced biofuels and biobased 

products requires intermediate 

ingredients and intermediate feedstocks, 

such as chopped grasses or wood chips. 

As specified in this rule, the source 

material and the intermediate ingredient 

or feedstock are considered separate 

eligible materials; however, only the 

source material qualifies for a matching 

payment because intermediate 


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ingredients or feedstock are not 

collected or harvested directly from the 

land. Advanced biofuels and 

intermediate ingredients or feedstock 

are not collected or harvested directly 

from the land, therefore, they do not 

qualify to receive matching payments. 

The intent of BCAP is to provide 

matching payments for actual 

collections and harvestings not 

incidences to normal industrial 

processes. 

Eligibility for Establishment Payments 

and Annual Payments 

BCAP establishment payments and 

annual payments will be available for 

persons and legal entities with eligible 

land that is located within a project area 

designated by CCC. CCC will consider 

project area proposals from project 

sponsors on a continuous basis. Unlike 

the matching payments component of 

BCAP, where any owner of eligible 

materials can be eligible for BCAP, 

under the establishment payments and 

annual payments component, only 

producers in a designated project area 

may be eligible for payment. The 

establishment payments will cover not 

more than 75 percent of the cost of 

establishment of eligible woody and 

non-woody perennial crops, and annual 

payments for up to 5 years for the 

production of eligible annual and nonwoody perennial renewable biomass 

crops and for up to 15 years for the 

production of eligible woody perennial 

renewable biomass crops. In response to 

comments received, this rule includes 

algae specifically as a non-woody 

perennial crop. By designating project 

areas, BCAP will support the 

development of renewable biomass 

production near biomass conversion 

facilities. 

Proposing Project Areas 

Project areas must be proposed by 

project sponsors, which could be groups 

of producers or biomass conversion 

facilities. There is no restriction in this 

rule on who can own or operate a 

biomass conversion facility, or sponsor 

a project area. Various parties may own 

a biomass conversion facility such as 

Federal entities, private entities, State or 

local government agencies, schools, or 

non-government organizations, 

provided that these parties have legal 

title to the facility. 

CCC will accept project area proposals 

on a continuous basis. A complete 

proposal must include, at a minimum: 

(1) A description of the eligible land 

and eligible crops of each producer that 

will participate in the proposed project 

area; 

(2) A letter of commitment from a 

biomass conversion facility stating that 

the facility will use eligible crops 

intended to be produced in the 

proposed project area; and 

(3) Information demonstrating that the 

biomass conversion facility has 

sufficient equity available to operate by 

the harvest of a crop in the project area 

if the facility is not operational at the 

time the project area proposal is 

submitted. 

While the 2008 Farm Bill does not 

require conservation plans or forest 

stewardship plans as part of an 

acceptable proposal, it does require that 

all contracts within a project area 

provide for the implementation of a 

conservation plan, forest stewardship 

plan, or equivalent plan. As such, 

project area proposals must also include 

a description of the general conservation 

and forest stewardship measures that 

will be implemented in plans under 

contracts within the area. 

For item 1 above, the project sponsor 

must submit a narrative of the proposed 

project and submit maps of the project 

area delineating the location of the 

current or proposed biomass conversion 

facility. The maps must show: (1) 

Current land use, (2) roads, (3) railroads, 

(4) rivers and barge access, (5) proposed 

land use change, and (6) resource 

inventory maps including soils and 

vegetation. 

For item 3 above, evidence of 

sufficient equity must include 

documentation of the projected 

construction, start-up, operation, and 

maintenance costs. 

The project sponsors must document 

the estimated cash-flow of the project 

(including assumptions on the 

production outputs and expected 

market prices for the products 

produced). In addition, the project 

sponsor must document its existing 

resources and short term and long term 

financing. The information provided to 

CCC as proof of sufficient equity will be 

confidential to the extent allowed by 

law and CCC will only use it to 

determine if sufficient equity is 

available for the facility and the project. 

The project sponsor must also submit 

an analysis of the economic impacts of 

the proposed project area. At a 

minimum the analysis must address the 

anticipated timing and number for job 

creation and retention and likelihood of 

attracting additional private sector 

investment. 

At a minimum, projects must 

demonstrate the ability to support the 

development and production of heat, 

power, biobased products, or advanced 

biofuels from renewable biomass 

production. The facility must 

demonstrate long-term economic 

viability and ability to comply with all 

environmental and regulatory 

requirements for the production of heat, 

power, biobased products, or advanced 

biofuels from renewable biomass. In 

addition, the project must demonstrate 

that sufficient quantity of eligible crops 

will be grown within an economically 

viable distance from the facility. 

A project area must have specific 

geographic boundaries that are 

described in specific terms such as 

acres, watershed boundaries, mapped 

longitude and latitude coordinates, or 

counties. The project area must be 

physically located near a biomass 

conversion facility or multiple biomass 

conversion facilities. What constitutes 

an appropriate location will be 

determined on a case-by-case basis. 

Whether a project area is within an 

economically viable distance from a 

biomass conversion facility depends on 

the eligible crops being established and 

produced, as well as other 

transportation and logistics matters, and 

therefore these determinations will be 

made on a case-by-case basis. The 

biomass conversion facility or facilities 

may be within the geographic boundary 

of the project area, or near it. The 

project area must also include potential 

or established producers that would 

supply a portion or all of the renewable 

biomass needed by the biomass 

conversion facility or facilities. 

Project Area Selection Criteria 

CCC will evaluate project area 

proposals using these criteria: 

(1) The volume of the eligible crops 

proposed to be produced in the 

proposed project area and the 

probability that such crops will be used 

for BCAP purposes; 

(2) The volume of renewable biomass 

projected to be available from sources 

other than the eligible crops grown on 

contract acres; 

(3) The anticipated economic impact 

in the proposed project area, such as the 

number of jobs created and retained; 

(4) The opportunity for producers and 

local investors to participate in the 

ownership of the biomass conversion 

facility in the proposed project area; 

(5) The participation rate by 

beginning or socially disadvantaged 

farmers or ranchers; 

(6) The impact on soil, water, and 

related resources, such as effect on 

nutrient loads, or soil erosion; 

(7) The variety in biomass production 

approaches within a project area, 

including agronomic conditions, harvest 

and postharvest practices; and 

monoculture and polyculture crop 

mixes; and 


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(8) The range of eligible crops among 

project areas. 

Project sponsors that are biomass 

conversion facilities may be any size of 

operation including pilot facilities, 

research units, experimental or 

demonstration operations, or 

commercial operations. A biomass 

conversion facility not yet in operation 

can be a project sponsor. In that case, 

the biomass conversion facility must 

provide evidence that it has sufficient 

equity available. 

Project Area Eligible Crops 

After CCC approves a project area, 

persons and legal entities within the 

specific geographic boundaries of that 

area may be eligible for payment for the 

establishment and production of eligible 

crops. 

An eligible crop is a crop of 

renewable biomass. Animal wastes, food 

and yard wastes, and algae are not 

excluded from the definition of eligible 

crop unlike the definition of eligible 

material; therefore, those categories of 

renewable biomass will be considered 

eligible crops. The 2008 Farm Bill 

specifies certain types of eligible crops 

that are excluded, including any crop 

that is eligible to receive payments 

under Title I of the 2008 Farm Bill, 

noxious weeds, and invasive species. 

For the invasive species or noxious 

weeds exclusion, the determination of 

whether a species is either invasive or 

noxious varies by State; therefore, if the 

crop is neither invasive nor noxious in 

a State, it would be eligible in that State 

for BCAP establishment payments and 

annual payments. FSA State committees 

will consult with the State technical 

committees for recommendations 

concerning the invasive and noxious 

status for otherwise eligible crops for 

the purposes of BCAP. Information on 

ineligible species will be available in 

FSA county offices. 

Project sponsors may suggest the 

exact species and varieties of eligible 

crops allowable in a BCAP project area, 

provided that the crops are included in 

the BCAP definition of eligible crop. 

Project area proposals may limit the 

nature and types of eligible crops to be 

established within a project area. 

Federal- and State-owned land, 

including land owned by local 

governments or municipalities, is 

excluded from the definition of eligible 

land in the 2008 Farm Bill and therefore 

is not eligible for the establishment 

payments and annual payments 

component of BCAP. The specification 

about the exclusion for land owned by 

local governments or municipalities is 

for consistency with other CCC 

programs; the terms ‘‘State’’ and ‘‘State 

government’’ mean any State or local 

government, including, but not limited 

to State, city, town, or county 

government, State Universities, and 

other units of State government. 

Project Area Eligible Producers 

Within the project area, to be eligible 

to receive establishment payments to 

convert agricultural lands or 

nonindustrial private forest lands to the 

production of eligible crops producers 

must enter into BCAP contracts 

enrolling their land as contract acreage. 

In addition, producers may also be 

eligible for annual payments for the 

production of eligible crops used for 

conversion to renewable energy, 

including advanced biofuels, or 

biobased products. The details for what 

is required to qualify for the annual 

payments will be specified in the 

individual contract between CCC and a 

producer, as discussed further below, 

and will include provisions for the 

implementation of a conservation plan, 

forest stewardship plan, or equivalent 

plan. The producer must demonstrate 

compliance with the plan through 

required self-certification and FSA will 

ensure that normal spot check rules and 

methods are followed to ensure 

compliance with the plan. Producers 

with previously established eligible 

crops as of the date this rule is effective 

may enter into a contract for annual 

payments to continue growing those 

crops; however, establishment payments 

will not be authorized in that case. 

Project sponsors, regardless of 

whether they are a biomass conversion 

facility or a group of producers, may 

also be considered as a producer and be 

eligible to receive establishment 

payments and annual payments. The 

sponsor must own or operate eligible 

land to be eligible to enroll as a 

producer under a BCAP contract and be 

eligible to receive establishment 

payments and annual payments. 

Federal- or State-owned biomass 

conversion facilities may be project 

sponsors, but will not be eligible to 

enter into a BCAP contract with CCC 

because neither Federal- nor Stateowned land is ineligible for 

establishment payments and annual 

payments. 

The agreement between the project 

sponsor and CCC is not a contract in the 

sense that in return for some action a 

payment is made by CCC. A successful 

project sponsor is not paid by CCC for 

being a sponsor; the producers in the 

project area, who may also be the 

sponsor, are eligible for payment for the 

establishment and production of eligible 

crops. Because this arrangement with 

sponsors produces no payment as such, 

and is not a procurement of a good or 

service, biomass conversion facilities 

that are also project sponsors are not be 

subject to general Federal contracting 

requirements as a condition of a project 

area approval. 

Project Area Contract Acreage and 

Terms 

A producer within the project area 

may enter into a contract with CCC to 

commit acres, which would then be 

called contract acreage, to establish or 

produce eligible crops. 

Contract terms include: 

(1) Compliance with highly erodible 

and wetland conservation requirements 

contained in the 2008 Farm Bill and in 

7 CFR part 12; 

(2) The implementation of 

conservation plan as defined in 7 CFR 

1410.2, a forest stewardship plan as 

defined in 16 U.S.C. 2103(a), or an 

equivalent plan as determined by the 

FSA Deputy Administrator for Farm 

Programs; 

(3) A commitment to provide 

information to promote the production 

of eligible crops and the development of 

biomass conversion technology; and 

(4) Other information deemed 

appropriate by CCC, such as the 

preservation of cropland bases and yield 

history. 

Contract durations may be up to 5 

years for annual and non-woody 

perennial crops, and up to 15 years for 

woody perennial crops. CCC will adjust 

the terms of the contract length on a per 

project basis in order to ensure the most 

efficient use of Federal government 

funding. The establishment time period 

may vary due to type of crop, agronomic 

conditions (such as establishment time 

frame and winter hardiness), and other 

factors. CCC will establish the time 

frame based on the recommendations 

received from the State Technical 

Committee. 

Contracts will take into account an 

establishment period appropriate for an 

existing crop’s harvest or for the 

establishment of a planned crop. BCAP 

contracts and plans will be designed to 

promote the production of a long-term 

source of biomass feedstock that can be 

collected and harvested in a reasonable 

period of time. The expectation, which 

will be reflected in the contract, is that 

eligible crops funded under BCAP will 

produce at least one harvest for biomass 

within the period of the contract. 

Contracts are subject to modification 

and payment reductions if any of the 

contract terms are violated. Participants 

that chose to voluntarily withdraw from 

BCAP before the duration of their 

contract has ended will be subject to 


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early contract termination penalties and 

may be required to refund payments. 

During the term of the contract, CCC 

will share not more than 75 percent of 

the cost with participants for 

establishing non-woody and woody 

perennial crops, pay an annual payment 

for enrolled land, and provide for the 

preservation of cropland base and yield 

history applicable for land enrolled in a 

BCAP contract. 

Eligible and Ineligible Land 

The contract acreage will consist of 

only the eligible lands that are covered 

under the producer’s contract with CCC. 

A producer may own land outside the 

project boundary area, or choose not to 

sign up all their acreage for BCAP, in 

which case the contract provisions will 

only apply to the contract acreage. 

Eligible land for project areas is 

agricultural land and nonindustrial 

private forest land, subject to certain 

exclusions. 

As specified in this rule, eligible 

agricultural land includes: 

(1) Cropland; 

(2) Grassland; 

(3) Pastureland; 

(4) Rangeland; 

(5) Hayland; and 

(6) Other lands on which food, fiber, 

or other agricultural products are 

produced or capable of being legally 

produced for which a valid conservation 

plan exists or is implemented. 

Land considered ineligible to be 

enrolled under a BCAP contract 

includes: 

(1) Federal lands; 

(2) State-owned, municipal, or other 

local government-owned lands; 

(3) Native sod; and 

(4) Land that is already enrolled in 

CCC’s CRP, Wetlands Reserve Program, 

or Grassland Reserve Program. 

Agricultural lands with previously 

established eligible crops or previously 

contracted for eligible crops or planned 

eligible crops are eligible lands for 

contract acreage. In other words, as 

noted earlier, producers who started 

growing renewable biomass before 

BCAP was implemented may enter into 

a contract with CCC for annual 

payments. There is no intent to exclude 

‘‘early adopters’’ producing biomass 

crops. 

‘‘Nonindustrial private forest land’’ is 

defined in this rule as rural land with 

existing tree cover, or suitable for 

growing trees, owned by any private 

individual, group, association, 

corporation, Indian Tribe, or other 

private legal entity. This definition 

allows for the inclusion of properties 

such as a privately held tree farm or a 

private forest landowners’ cooperative. 

This is consistent with the definitions of 

‘‘landowner’’ and ‘‘nonindustrial private 

forest land’’ in the Cooperative Forestry 

Assistance Act of 1978, as amended (16 

U.S.C. 2103a), which includes private 

legal entities as landowners of such 

forest land. Existing nonindustrial 

private forest land with existing tree 

cover can be entered into contract 

acreage within an approved project area 

and be eligible for annual payments, 

subject to a forest stewardship plan or 

equivalent plan. Establishment 

payments will only be made for woody 

perennial crops with a projected initial 

harvest time occurring within the length 

of the contract period. 

While land enrolled in other USDA 

programs may be eligible lands for 

contract acreage, the contracting 

producer may not receive multiple 

program benefits for purposes that are 

the same or substantially similar to the 

purposes of BCAP. While there are 

currently no other Federal programs 

incentivizing biomass, if in the future 

there are, duplicate payments will be 

prohibited. A contracting producer must 

choose whether to receive BCAP 

payments or other USDA or Federal 

program benefits where those benefits 

are designed to achieve the same 

purposes as BCAP. 

BCAP contracts will not restrict uses 

of contract acres other than to require 

the production of eligible crops 

provided that CCC determines that the 

land uses would be consistent with the 

conservation plan, forest stewardship 

plan, or equivalent plan and any other 

BCAP conservation requirements. 

Making Establishment Payments 

Establishment payments of not more 

than 75 percent of the cost for 

establishing a perennial crop, which 

could include woody biomass, will 

include: 

(1) The costs of seed and stock for 

perennials; 

(2) The cost of planting the perennial 

crop; 

(3) For non-industrial forest land, the 

costs of site preparation and tree 

planting; and 

(4) Other proposed establishment 

activities that could include, but would 

not be limited to, site preparation for 

non-tree planting and supplemental or 

temporary irrigation. 

In addition, partial payments may be 

authorized when identifiable 

components of the contract are 

completed; and supplemental 

establishment payments may be 

authorized if necessary. 

Establishment payments will not be 

authorized for annual crops. In addition, 

prior to receiving establishment 

payments, producers must have planted 

their eligible crops and must provide 

their FSA county office with copies of 

receipts and invoices related to the cost 

of establishing such crops. 

Making Annual Payments 

Annual payments will be calculated 

on a per acre basis using market-based 

rental rates, as determined by CCC. The 

payments are intended to support the 

production of eligible crops. Annual 

payment rates will be established at 

levels required to ensure sufficient 

participation in a project area. 

As specified in the regulations in 7 

CFR 1410.42, which set the rental 

payment rate procedures for land in 

CRP, and as determined by CCC, annual 

payments will include a payment based 

on: 

(1) A weighted average soil rental rate 

for cropland; 

(2) The applicable marginal 

pastureland rental rate for all other 

agricultural land; and 

(3) For forest land, the average county 

rental rate for cropland as adjusted for 

forest land productivity for 

nonindustrial private forest land. 

This rate information will be posted at 

FSA county offices (as FSA posts 

information for CRP). There are sitespecific factors including type of soil 

and land use that determine the exact 

rate. CCC will post in FSA county 

offices the county-specific base-line 

rental rates for cropland, marginal 

pastureland, and forest land. In 

addition, the applicable additional 

incentive payments (premiums) will be 

posted for the project area or specific 

crop mixes within the project area. The 

large number of factors used to 

determine the rates for specific crops, 

land uses, soil types, counties, and 

project areas preclude this information 

being suitable for posting on the FSA 

Web site. 

In determining the applicability of 

incentive payments (premiums) to the 

annual base-line soil rental rates, the 

Deputy Administrator will consider the 

costs of establishing the crop, and the 

potential of specific perennial eligible 

crops that are not primarily grown for 

food or animal feed. 

CCC must reduce payments to avoid 

duplicate benefits, but the annual 

payment reduction for delivery to a 

biomass conversion facility will be a 

percentage of the payments received 

(not dollar-for-dollar) if the crop is 

converted to heat, power, biobased 

products, or advanced fuels, because the 

purpose of BCAP is to encourage 

biomass energy production. The 

reduction will be relatively small if the 

crop is converted to cellulosic biofuels 


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66212 Federal Register / Vol. 75, No. 207 / Wednesday, October 27, 2010 / Rules and Regulations 

or advanced biofuels, in order to 

encourage the production of fuels that 

meet the National renewable fuel 

standard. If the harvested production is 

sold for any reason other than 

conversion to heat, power, biobased 

products, or advanced biofuel, a dollarfor-dollar reduction for each dollar 

received for the sale will apply, not to 

exceed the total annual payment. 

Specifically, annual payments will be 

reduced: 

(1) By 1 percent if the eligible crop is 

delivered to a biomass conversion 

facility for conversion to cellulosic 

biofuels as defined in 40 CFR 80.1401; 

(2) By 10 percent of the total of the 

sales price and matching payment if the 

eligible crop is delivered to a biomass 

conversion facility for conversion to 

advanced biofuels, as determined by 

CCC; 

(3) By 25 percent of the total of the 

sales price and matching payment if the 

eligible crop is delivered to a biomass 

conversion facility for conversion to 

heat, power, or biobased products, as 

determined by CCC; 

(4) By 100 percent of the sales price 

and matching payment if the eligible 

crop is used for a purpose other than 

conversion to heat, power, biobased 

products, or advanced biofuels, as 

determined by CCC; 

(4) If the producer violates a term of 

the contract; or 

(5) In other circumstances necessary 

to carry out BCAP, as determined by 

CCC. 

Annual payments will be made for 

agricultural land and nonindustrial 

private forest land. CCC will calculate 

market-based rental rates for cropland 

consistent with the CRP regulations in 

7 CFR part 1410; and for all other 

agricultural land at the rate that would 

be paid for pastureland, consistent with 

CRP. 

CCC will calculate the market-based 

payment rate for nonindustrial private 

forest land using the average county 

rental rate for cropland developed for 

CRP and adjusting that rate by 

comparing the average productivity of 

cropland compared to the average 

productivity of forest land. 

Half of the first year’s annual payment 

will be made, if practicable, to the 

producer within 30 days of the date of 

contract approval and the balance will 

be paid on the annual contract 

enrollment anniversary. Subsequent 

annual payments, if practicable, will be 

made every year within 30 days after the 

contract anniversary date. Payments 

may cease and producers may be subject 

to contract termination and associated 

penalties for failure to establish eligible 

crops. 

Key Provisions Comparison of BCAP 

Matching Payment Versus 

Establishment Payment and Annual 

Payment Provisions 

This table compares the key 

provisions of matching payments versus 

establishment payments and annual 

payments: 

Matching payments Establishment payments and annual payments 

Geographic Eligibility ........... Not limited ....................................................................... Limited to geographically designated project area. 

Project Sponsor ................... Not applicable ................................................................. A project sponsor proposes project areas and may be 

a: 

• Biomass conversion facility, including facilities 

owned by Federal entities, State entities, local 

government entities, or privately or publicly held 

entities; or 

• Group of producers. 

Eligible Material Owner or 

Eligible Producer.

An eligible material owner may be: 

• A producer within a project area; 

• A biomass conversion facility; or 

• A person or a non-Federal entity that has legal 

title to eligible material, including Indian Tribes 

and Tribal members. 

• An eligible material owner cannot be a Federal 

government entity. 

An eligible producer may be a: 

• Biomass conversion facility that owns or operates eligible land and produces an eligible crop; 

or 

• Person or entity with the legal title to privately 

held lands or land held in trust by the Federal 

government (but only one person in any case for 

any material on any land can qualify for the 

matching payment). 

An eligible producer cannot be a: 

• Federal government entity, or 

State or local government entity. 

Land Limitations or Eligible 

Land.

To qualify for payments, eligible material must be collected or harvested directly from certain: 

• U.S. National Forest System and BLM lands, 

• Non-government lands including non-Federal 

lands, and State- and locally-held government 

lands, or 

• Tribal land held in trust by the Federal government. 

Eligible land is certain: 

• Agricultural land, such as cropland, pastureland, 

rangeland, grassland, or other lands on which 

food, fiber, or other agricultural products are produced or capable of being produced; or 

• Nonindustrial private forest lands that are: 

Æ Rural lands with existing tree cover, or are suitable for growing trees; and 

Æ Owned by any private individual, group, or association. 

• Eligible land cannot be: 

• Federal- or State-owned land; 

• Land that is native sod; or 

• Land enrolled in: 

Æ CRP; 

Æ Wetlands Reserve Program; or 

Æ Grassland Reserve Program. 


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Matching payments Establishment payments and annual payments 

Eligible Crop or Material ...... To qualify for payments, eligible material is certain: 

• Materials, pre-commercial thinnings, or invasive 

species from National Forest System land and 

U.S. Bureau System land that: 

Æ Are byproducts of preventive treatments that are 

removed to reduce hazardous fuels, to reduce or 

contain disease or insect infestation, or to restore ecosystem health; 

Æ Would not otherwise be used for higher-value 

products; and 

Æ If from Federal lands, are harvested in accordance with applicable law and land management 

plans and the requirements for old-growth maintenance, restoration, and management direction 

of section 102 (e)(2), (3), and (4) of the Healthy 

Forests Restoration Act of 2003 (16 U.S.C. 

6512) and large-tree retention of subsection (f). 

• Any organic matter that is available on a renewable or recurring basis from non-Federal land or 

land belonging to an Indian or Indian Tribe that 

is held in trust by the United States or subject to 

a restriction against alienation imposed by the 

United States, including:.

Æ Renewable plant materials such as feed grains, 

other agricultural commodities, and other plants 

and trees; and.

Æ Waste materials including vegetative waste including crop residues and Title I crop residues, 

and other vegetative waste materials including 

wood wastes and wood residues.

Eligible crop is: 

• Renewable plant materials such as feed grains, 

other agricultural commodities, other plants and 

trees, and algae; 

• Waste materials including vegetative waste, 

such as crop residues, other vegetative waste 

materials, such as woods wastes and wood residues, animal waste and byproducts, such as 

fats, oils, greases, and manure, food waste, and 

yard waste; 

Ineligible crops include: 

• Any crop that is eligible to receive payments 

under Title I of the 2008 Farm Bill. 

• Any plant that is invasive or noxious or has the 

potential to become invasive or noxious. 

Eligible material does not include: 

• Any crop that is eligible to receive payments 

under Title I of the 2008 Farm Bill or an amendment made by that Title including a crop of barley, corn, grain sorghum, oats, rice, or wheat; 

honey; mohair; certain oilseeds such as canola, 

crambe, flaxseed, mustard seed, rapeseed, safflower seed, soybeans, sesame seed, and sunflower seeds; peanuts; pulse crops such as 

small chickpeas, lentils, and dry peas; dairy 

products; sugar; wool; and cotton boll fiber Animal waste and animal waste byproducts (including fats, oils, greases, and manure); 

• Food waste and yard waste; 

• Algae 

Authorized Payments ........... A matching payment at a rate of $1 for each $1 per dry 

ton equivalent paid by the qualified biomass conversion facility in an amount up to $45 per dry ton.

Establishment payments at a rate of not more than 75 

percent of establishment costs based on: 

• The costs of seed and stock for perennials; 

• The cost of planting the perennial crop; and 

• For non-industrial forest land, the costs of site 

preparation and tree planting(s). 

Annual payments equal to the market rate plus any incentive as provided for in a specific project area. 

Payment Reductions ............ Matching payments must be refunded to CCC if an eligible material owner violates the terms of their contract with CCC including, but not limited to: 

• Not adhering to the provisions in the conservation plan, forest stewardship plan, or equivalent 

plan including establishing or spreading noxious 

or invasive species, as determined by the Deputy Administrator; 

Annual payments will be reduced if: 

• An eligible crop is sold for any purpose, including a matching payment for collection, harvest, 

storage, or transportation; or 

• The producer violates a term of the contract. 

Payments may cease and producers may be subject to 

contract terminations for failure to establish eligible 

crops. 

• Delivering eligible material not harvested directly 

from the land by the eligible material owner; 

• Delivering eligible material prior to COC application approval; 

• Delivering eligible materials that would otherwise 

be used to produce higher-value products; or 

• Delivering otherwise eligible material that must 

be separated from materials used to produce 

higher-value products. 


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Matching payments Establishment payments and annual payments 

Payment Timing ................... Matching payments are paid within 30 days after the 

request for payment by the eligible material owner is 

submitted at the FSA county office, including submission of sales invoice(s) issued by the qualified biomass conversion facility.

Establishment payments are paid when the perennial 

eligible crop practice or identifiable portion of the 

practice has been completed according to the BCAP 

conservation plan, forest stewardship plan, or equivalent plan. 

Annual payments are paid: 

• As an advance payment in an amount equal to 

50 percent within 30 days of contract approval 

with the remaining 50 percent within 30 days of 

the first-year contract anniversary date, and 

• Within 30 days of the contract anniversary beginning with the second-year contract anniversary. 

Duration ................................ Payment duration is 2 years from the date on which the 

first matching payment is issued to an eligible person 

or entity taking in account the NOFA period as determined appropriate by the Deputy Administrator.

Contract duration is up to: 

• 5 years for annual and non-woody perennial 

crops, and 

• 15 years for woody perennial crops. 

Project Area Proposals or 

Matching Payment Applications.

Applications for matching payments will be accepted on 

a continuous basis. To apply for a matching payment 

an eligible material owner must submit an application 

to the FSA county office prior to the delivery of the 

eligible material and then submit the request for payment at the FSA county office after delivery of eligible material is made to the qualified biomass conversion facility.

Project area proposals may be submitted at any time. 

After a project area has been approved, eligible persons and legal entities within that project area may 

enroll in a BCAP contract at the FSA county office. 

Summary of Comments 

CCC received 24,008 comments on the 

proposed rule from all States, the 

District of Columbia, the Virgin Islands, 

Puerto Rico, Northern Mariana Islands, 

U.S. Minor Islands, and 88 other 

countries. 

We received comments from 

individuals, trade groups and other 

organizations, State and local 

government entities, Federal entities, 

Tribes, and Alaska native corporations. 

The majority of the comments were 

submitted as one of 4 different form 

letters. One form letter dominated the 

comments, although many commenters 

edited the form letter for their personal 

submission. The letters represented the 

comments of associations, a corporation, 

and another interested organization. 

This final rule is based on 

consideration of the comments received 

and on CCC’s experience in 

implementing matching payments 

under the NOFA. In addition to the 

substantive comments discussed below, 

minor editorial and technical changes 

have been made to the regulations for 

clarity and to facilitate implementation. 

Comments that addressed issues outside 

the scope of BCAP were not addressed 

in this rule because CCC does not have 

the authority to address those issues in 

this rule. Similarly, CCC does not have 

the authority to limit the scope of BCAP 

to a smaller or more restrictive program 

than the 2008 Farm Bill authorizes, or 

to expand it beyond our authority 

except as may be needed to keep BCAP 

within spending limits specified in the 

2010 Supplemental Appropriations Act. 

There were general comments both 

supporting and opposing BCAP that did 

not provide specific suggestions for 

changes to a specific section or subpart 

of the proposed rule. General comments 

are discussed below followed by a 

section-by-section analysis of comments 

in order by the section number of the 

regulations. Out of scope comments, 

such as those about solar and wind 

technology, on-farm storage costs, and 

other issues outside of the authority for 

BCAP are not included in the discussion 

and no change was made based on those 

comments. 

Comment: BCAP is necessary beyond 

2012. 

Response: The 2008 Farm Bill does 

not authorize this program beyond 2012. 

Contracts for establishment payments 

entered into before 2012 may continue 

beyond 2012. Accordingly, no change 

was made to the rule in response to this 

comment. 

Comment: BCAP project areas should 

be the top priority for BCAP and 

matching payments spending should be 

significantly reduced to 20–50 percent 

of BCAP expenditures, perhaps in 

conjunction with an annual cap for 

matching payments above which no 

additional applications will be 

accepted. 

Response: The 2008 Farm Bill 

provides such CCC funds ‘‘as are 

necessary’’ to carry out BCAP. However, 

the 2010 Supplemental Appropriations 

Act effectively caps BCAP funding at 

$552,000,000 and $432,000,000 in FY 

2010 and FY 2011, respectively. CCC is 

required to administer the program 

within these limits. No change was 

made to the rule in response to this 

comment. 

Comment: More emphasis should be 

placed on forest land ownership and 

more resources should be spent on 

creating harvesting opportunities on 

national forests. 

Response: Land devoted to forest and 

trees may be eligible for matching 

payments and for establishment 

payments to establish trees and other 

woody perennials. CCC believes that 

significant opportunities for eligible 

materials exist on private as well as 

public land and will administer the 

program accordingly. No change to the 

rule was made in response to this 

comment. 

Comment: The proposed budget is 

inadequate considering the size of the 

renewable biomass markets. 

Response: The 2010 Supplemental 

Appropriations Act establishes the 

funding to carry out the program. 

Comment: BCAP will create an 

oversupply of biomass products, 

distorting prices for biomass. Biomass 

conversion facilities are able to pay less 

than market value for participants’ 

biomass due to having a captive market. 

BCAP distorts markets and costs too 

much in a time of deficits. 

Response: The purpose of the BCAP 

program is to encourage the 

development of commercial demand 

and supply where none currently exists 

for non-traditional biomass crops used 

for heat, power, biobased producers and 

biofuels. This rule was changed in 

response to this comment and requires 

that biomass conversion facilities pay a 

fair market rate for biomass and that 

they do not have a different rate for 


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BCAP participants than for other 

biomass suppliers. 

Comment: Limit payments to foreignowned companies. 

Response: The 2008 Farm Bill does 

not prohibit enrollment by otherwise 

eligible foreign citizens or foreignowned entities. Therefore, no change to 

the rule was made in response to this 

comment. 

Comment: There is a need for 

intermediate facilities to receive, 

process, store, and disburse raw biomass 

fuel feedstock. 

Response: Intermediate facilities may 

be a critical part of the biomass 

feedstock supply chain. However, in 

order for material to be eligible for 

BCAP matching payments, an eligible 

material owner must retain beneficial 

interest in that material until it is 

delivered to a qualified biomass 

conversion facility. No change to the 

rule was made in response to this 

comment. 

Comment: Coupling BCAP with other 

FSA programs, such as CRP, may 

support efforts to promote additional 

tree plantings and may support acres 

that need to be thinned to improve their 

quality for wildlife habitat. 

Response: FSA implements a number 

of programs that assist farmers and 

ranchers in managing risk levels. We 

agree that producers may want to enroll 

in multiple FSA programs, including 

BCAP and CRP, to meet a particular 

farming operation’s goals. We are not 

changing the regulations to specifically 

link requirements for the two programs, 

because we do not have authority to do 

so—the 2008 Farm Bill specifically 

excludes CRP land from eligible land for 

BCAP establishment payments and 

annual payments. Where possible, 

efforts will be made to coordinate FSA 

and CCC programs with complementary 

goals. Although land in CRP is not 

eligible for BCAP establishment 

payments and annual payments, 

production on such land, if consistent 

with the CRP contract, may be eligible 

for matching payments. 

Comment: The structure of other FSA 

programs prohibits producer 

participation in BCAP and imposes 

hurdles or provides incentives against 

producer participation in BCAP. The 

public needs further guidance on 

participation in multiple FSA programs 

and on how BCAP may impact base 

acres. 

Response: BCAP is being 

implemented with the intent to 

minimize conflicts between programs. 

For instance, the 2008 Farm Bill 

provides for the preservation of base 

acres and yield history for land enrolled 

under a BCAP contract. Participation in 

BCAP will not preclude eligibility for 

the direct and counter-cyclical payment 

program (DCP) or the average crop 

revenue election program (ACRE). No 

change to the rule was made in response 

to this comment. 

Comment: Complete this rulemaking 

expeditiously and resume payments 

under BCAP immediately. 

Response: Payments will start after 

this final rule becomes effective, which 

is after the date this rule is published in 

the Federal Register. No change to the 

rule was made in response to this 

comment. 

Comment: The NOFA stimulated a 

considerable amount of capital 

investments by both eligible material 

owners and biomass conversion 

facilities. The temporary termination of 

matching payments under the NOFA 

and the potential changes in BCAP may 

result in a loss of their ability to 

participate and loss of capital 

investments. 

Response: We are aware of the 

concerns regarding continuity between 

the NOFA and this final rule. We have 

made adjustments to the final BCAP 

rule that are consistent with BCAP 

purposes, maintain continuity, and meet 

the overall program objectives of 

supporting the long-term supply of 

renewable biomass. 

Comment: FSA should provide 

adequate training and support for FSA 

State and county staff that will be 

implementing BCAP. 

Response: As we do with other FSA 

and CCC programs, we will be providing 

training to the field staff that will 

implement BCAP. 

Common Provisions in Subpart A 

Administration (§ 1450.1) 

Comment: Provide sufficient 

personnel to expeditiously support 

project area sponsors in developing 

project area proposals and 

quantitatively monitor BCAP’s 

productivity for both matching 

payments and establishment payments 

and annual payments. 

Response: FSA has more than 2,200 

county offices serving rural America. 

FSA county offices are available to 

assist in the development of project 

proposals. Performance indicators will 

be developed to document and monitor 

BCAP’s benefits, ultimately enhancing 

delivery of BCAP by identifying those 

practices and locations that provide the 

greatest benefits per dollar invested. No 

change to the rule was made in response 

to this comment. 

Definitions—General, New Terms 

(§ 1450.2) 

Comment: Create a glossary of terms 

that accurately and clearly defines terms 

based on their use in industry and the 

academic community. 

Response: BCAP definitions are based 

on the 2008 Farm Bill, where 

applicable, or other regulations, as 

appropriate. In other cases, the terms are 

a result of consultation and 

collaboration with Federal experts and 

other stakeholders. Terms not 

specifically defined in this rule have 

their common dictionary meaning and 

are not used in a specialized way in this 

rule. No change to the rule was made in 

response to this comment. 

Comment: Clearly define ‘‘aggregator 

of eligible material,’’ ‘‘algae,’’ ‘‘biofuel,’’ 

‘‘biofuel refinery,’’ ‘‘biomass,’’ ‘‘biomass 

processor,’’ ‘‘cellulosic biofuel,’’ ‘‘Federal 

land,’’ ‘‘landowner,’’ ‘‘sustainably 

managed forest land,’’ and ‘‘wood.’’ 

Response: We made changes to the 

definitions section of the rule in 

response to comments. We have added 

a definition of ‘‘biofuel’’, consistent with 

Sec. 9001 of the 2008 Farm Bill, to 

provide clarity to the related definition 

of ‘‘advanced biofuel’’ The terms 

‘‘aggregator,’’ ‘‘aggregator of eligible 

material,’’ ‘‘biofuel refinery,’’ ‘‘biomass,’’ 

‘‘biomass processor,’’ ‘‘cellulosic 

biofuel,’’ and ‘‘sustainably managed 

forest land’’ were not included in the 

proposed or final rule and, therefore, do 

not require a definition for BCAP. The 

definition of ‘‘landowner’’ is 

synonymous to the definition of 

‘‘owner’’ in 7 CFR part 718 that also 

applies to 7 CFR part 1410. Finally, the 

meaning of ‘‘algae,’’ ‘‘Federal land,’’ and 

‘‘wood’’ are commonly understood terms 

that do not need further definition 

because they are not used in a special 

way in this rule. 

Comment: Define ‘‘substantial’’ as it 

relates to the related-party transaction, 

‘‘ownership,’’ and ‘‘opportunity’’ as they 

relate to ownership and levels of 

biomass conversion facility ownership. 

Response: The term substantial does 

not need to be defined in this rule 

because the prohibition on related-party 

transactions has been removed from 

matching payments. 

Comment: Define ‘‘invasive species’’ 

and ‘‘noxious weed,’’ and reference 

definitions in Executive Order 13112 

and the Plant Protection Act, 

respectively. 

Response: The rule does reference 

Executive Order 13112 specifically. 

Since these terms are defined in the 

Executive Order and the Plant 

Protection Act, this rule will not redefine them. CCC will use those 


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definitions in determining the list of 

invasive species and noxious weeds for 

each applicable area. As specified in 

this rule, the list will be available at the 

FSA county office. 

Comment: Clarify the terms ‘‘eligible 

persons’’ and ‘‘legal entities.’’ 

Response: We agree the terms 

‘‘person’’ and ‘‘legal entity’’ need to be 

defined. For ease of administration and 

consistency with other CCC programs, a 

reference to the definitions in 7 CFR 

part 1400 was added to this rule. 

Definitions—Advanced Biofuel 

(§ 1450.2) 

Comment: Do not include pellets, 

wood chips, and briquettes as advanced 

biofuels. 

Response: Although pellets and 

briquettes would be considered to be 

advanced biofuels under the 2008 Farm 

Bill definition if comprised of eligible 

materials under BCAP, as wood chips 

would be considered an eligible 

material, such eligible materials may 

only qualify for matching payments if 

these materials meet other qualifications 

for payment as specified in this rule. 

However, if these materials have a 

higher value (existing market) in a 

distinct region, they would not qualify 

for matching payments. 

Definitions—Biobased Product 

(§ 1450.2) 

Comment: Include pulp and paper as 

a biobased product. 

Response: CCC will use a number of 

criteria in determining whether a 

particular product will be considered a 

biobased product. Products that have a 

mature market, such commercially 

produced timber, lumber, wood pulp, 

paper or other finished wood products, 

will not be considered to be biobased 

products for the purposes of BCAP. This 

is consistent with the general intent to 

stimulate the production of new 

biobased products and to energize 

emerging markets for those products. In 

making the determination, we will 

administer BCAP consistent with the 

standards of the BioPreferred 

Procurement Program, as authorized by 

section 9001 of the 2008 Farm Bill. 

Comment: The definition of biobased 

products may cause unintended issues 

or may allow products not oriented 

toward renewable energy to be included 

in BCAP. 

Response: The definition of ‘‘biobased 

product’’ in the 2008 Farm Bill gave the 

Secretary of Agriculture discretion to 

determine which products could be 

considered ‘‘a commercial or industrial 

product (other than food or feed) that is 

composed, in whole or in significant 

part, of biological products, including 

renewable domestic agricultural 

materials and forestry materials or an 

intermediate ingredient or feedstock.’’ In 

determining whether a commercial or 

industrial product will be considered 

‘‘biobased’’ for BCAP, CCC will use the 

standards set by USDA’s Biopreferred 

Procurement Program under the 

regulations at 7 CFR part 2902. 

Definitions—Biomass Conversion 

Facility (§ 1450.2) 

Comment: Keep the definition of 

biomass conversion facility as it appears 

in the proposed rule. 

Response: In response to other 

comments (discussed in other sections), 

the definition of biomass conversion 

facility was amended in this final rule 

to replace the term ‘‘eligible material’’ 

with ‘‘renewable biomass,’’ to clarify that 

a qualified biomass conversion facility 

is not restricted to only using eligible 

material, but may also process other 

types of renewable biomass that are not 

eligible for BCAP matching payments. 

Definitions—Conservation Plan 

(§ 1450.2) 

Comment: Define ‘‘conservation 

plans,’’ ‘‘forest stewardship plans,’’ and 

‘‘equivalent plans.’’ Make the 

requirements for all such plans 

consistent. 

Response: The rule defines 

‘‘conservation plan’’ and ‘‘forest 

stewardship plan.’’ The definitions have 

been amended slightly to be consistent 

with the relevant authorizing legislation 

for each while also being specific to 

BCAP. The term ‘‘conservation plan’’ is 

generally consistent with the definition 

applicable to Title II conservation 

programs in the 2008 Farm Bill, 

modified slightly to apply to eligible 

crops and eligible material, as 

appropriate. The definition for ‘‘forest 

stewardship plan’’ is consistent with the 

Cooperative Forestry Assistance Act of 

1978, as amended (16 U.S.C. 2103a). 

There may be land eligible for BCAP 

with similar plans approved by States or 

other agencies that serve the same 

purpose and have similar goals, 

objectives, and terms. A definition for 

‘‘equivalent plan’’ is included in the 

regulation as a result of the comments. 

Our intention is to review those 

situations and determine whether they 

are consistent and, if so, permit those 

equivalent plans to be used. References 

to ‘‘equivalent plan’’ were added 

throughout the rule. 

Definitions—Eligible Crop (§ 1450.2) 

Comment: Do not consider trees as a 

form of renewable biomass. 

Response: The definition of renewable 

biomass is specified by the 2008 Farm 

Bill and includes trees. Therefore, no 

change to the rule was made in response 

to this comment. 

Comment: Use the IRS definition of 

closed-loop biomass for the definition of 

eligible crops. 

Response: CCC understands that the 

IRS definition of ‘‘closed loop biomass’’ 

is inconsistent with the 2008 Farm Bill’s 

definition of ‘‘eligible crop’’ that, among 

other things, permits eligible crops to be 

converted to heat, biobased products, 

and advanced biofuels as well as 

electricity. Therefore, no change to the 

rule was made in response to this 

comment. 

Comment: Sugarcane should be 

considered as an eligible crop. 

Response: The 2008 Farm Bill 

specifically excludes from the definition 

of eligible crops or eligible materials any 

crop that is eligible to receive payments 

under Title I of the 2008 Farm Bill. 

‘‘Payments’’ are not made under Title I 

of the 2008 Farm Bill with respect to 

sugarcane, but rather, nonrecourse loans 

are made to eligible entities. Therefore 

sugarcane is not excluded from BCAP. 

Crops eligible for Title I payments for 

which producers have elected not to 

enroll those crops in Title I programs 

remain ineligible for BCAP. 

Comment: Exclude all Title I crops 

and crop residues from being 

considered as eligible crops. 

Response: Title I crops are explicitly 

excluded as eligible crops; however, 

Title I crop residues may qualify for 

matching payments so long as they meet 

all other requirements for collection, 

harvest, storage, and delivery. 

Comment: Exclude noxious or 

invasive species as eligible crops. 

Response: Under the 2008 Farm Bill’s 

definition of ‘‘eligible crop,’’ any plant 

that is noxious or invasive or has the 

potential to become noxious or invasive 

is excluded. Noxious or invasive status 

is generally established at the State 

level. No change to the rule was made 

in response to this comment. 

Comment: Eligible crops should 

include giant miscanthus, pennycress, 

black locust, guayule, hemp, highbiomass sorghum, and energy cane. 

Response: Project sponsors must 

specify eligible crops for the project 

area; those crops cannot include plants 

that are considered noxious or invasive 

or have the potential to become noxious 

or invasive in the State. Therefore these 

crops may be eligible crops in some 

States, but not in others. No change to 

the rule was made in response to this 

comment. 

Comment: Expand the definition of 

eligible crop and renewable biomass to 

include crops cultivated on Federal 

property. 


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Response: The 2008 Farm Bill 

excludes Federal- or State-owned land 

from eligibility for the establishment 

payments and annual payments portion 

of BCAP, so crops from that land, 

including privately owned biomass, 

cannot be eligible crops. Privately 

owned biomass grown on Federal- or 

State-owned land is ineligible for BCAP 

project areas. No change to the rule was 

made in response to this comment. 

Definitions—Eligible Material (§ 1450.2) 

Comment: Include Title I grains and 

oilseeds as eligible for matching 

payments if the farmer does not receive 

Title I subsidies for these crops. Barley 

dockage, which may include barley 

grain, should also be eligible for 

matching payments. 

Response: As specified in the 2008 

Farm Bill, the definition of ‘‘eligible 

material’’ excludes, among other things, 

any crop eligible to receive payments 

under Title I of the 2008 Farm Bill. The 

definition in the 2008 Farm Bill does 

not include an option for a producer to 

choose between BCAP matching 

payments or Title I benefits. Crops 

eligible for Title I programs where 

producers have elected to not enroll 

those crops in Title I programs are 

ineligible under BCAP. Likewise, any 

dockage or foreign material from noncontract acreage would be ineligible if it 

is comingled with ineligible Title I 

commodities. No change to the rule was 

made in response to this comment. 

Comment: CCC should remove the 20 

percent cap on payments for Title I 

residues that was in the NOFA. 

Response: The rule was changed and 

the cap is not included in the 

regulation. 

Definitions—Eligible Material Owner 

(§ 1450.2) 

Comment: Clarify the definition of 

eligible material owner, particularly 

with regard to stumpage. 

Response: ‘‘Owner’’ or ‘‘ownership’’ are 

commonly understood terms that do not 

need further definition and are not used 

in a special way in this rule. In the case 

of stumpage, the person who has 

purchased the right to harvest timber on 

the land clearly meets the definition of 

‘‘a person or entity having the right to 

collect or harvest eligible material.’’ No 

change to the rule was made in response 

to this comment. 

Definitions—Native Sod (§ 1450.2) 

Comment: Clarify the definition of 

‘‘native sod,’’ refer to the 2008 Farm Bill 

definition, and be explicit in its relation 

to eligible lands such as grasslands, 

rangelands, and pasturelands. 

Response: Under BCAP, land that is 

‘‘native sod’’ as of the date of the 2008 

Farm Bill’s enactment is excluded from 

eligible land. This rule uses the 2008 

Farm Bill’s definition of native sod 

found at section 12020 of the 2008 Farm 

Bill, which amends the Federal Crop 

Insurance Act (7 U.S.C. 1508) to add 

that definition. Native sod 

determinations must be made on a caseby-case basis because all three land uses 

(grasslands, rangelands, and 

pasturelands) may have been plowed at 

some point prior to the date of 

enactment of the 2008 Farm Bill; 

therefore, the rule does not clarify a 

specific relationship between native sod 

and grasslands, rangelands, and 

pasturelands. No change to the rule was 

made in response to this comment. 

Comment: Include ‘‘native sod’’ as 

eligible land. 

Response: The 2008 Farm Bill 

explicitly excludes ‘‘native sod’’ from 

the definition of eligible land. 

Therefore, no change to the rule was 

made in response to this comment. 

Definitions—Nonindustrial Private 

Forest Land (§ 1450.2) 

Comment: Clarify the definition of 

nonindustrial private forest land and 

reference language in the Cooperative 

Forestry Assistance Act. 

Response: We corrected to the 

definition to refer to section 5(c) of the 

Cooperative Forestry Assistance Act of 

1978, as amended (16 U.S.C. 2103a), as 

required by the 2008 Farm Bill 

definition of eligible land. 

Comment: Replace the ‘‘publicly 

traded corporations’’ exclusion in the 

definition of nonindustrial private forest 

land with a per producer acreage limit. 

Include publicly traded land as 

nonindustrial private forest land and 

limit the number of nonindustrial 

private forest land acres a producer may 

enroll in contract acreage. 

Response: The definition for 

nonindustrial private forest land in the 

proposed rule incorrectly excluded 

publicly traded corporations and 

accordingly has been revised in this 

final rule to remove that exclusion. That 

is consistent with the 2008 Farm Bill. 

However, implementing a contract 

acreage limit is not consistent with the 

2008 Farm Bill. Therefore, that 

suggestion was not adopted. Project area 

applications, however, may propose the 

geographic boundaries within which 

contract acreage may be offered, will 

limit contract acreage for some 

producers. 

Definitions—Producer (§ 1450.2) 

Comment: Be consistent with the use 

of ‘‘participant’’ and ‘‘producer’’ 

throughout the rule. 

Response: The terms ‘‘participant’’ and 

‘‘producer’’ are not synonymous. The 

term ‘‘producer’’ is a generic reference to 

those individuals and entities who are 

owners, operators, and tenants who may 

or may not be enrolled in an FSA 

program. A ‘‘participant’’ is an 

individual or entity who is an owner, 

operator, or tenant who is enrolled in an 

FSA program. No change to the rule was 

made in response to this comment. A 

‘‘producer’’ is an owner or operator of 

contract acreage that is physically 

located within a BCAP project area so 

long as the person or entity has a risk 

of loss in the crop. 

Definitions—Related-Party Transaction 

(§ 1450.2) 

Comment: The provisions on relatedparty transactions are inappropriate 

because of the vertically, geographically, 

and otherwise integrated nature of the 

forestry products industry. Add 

provisions to the definition of relatedparty transactions to encourage 

cooperatives. 

Response: We have removed ‘‘relatedparty transactions’’ as a limitation under 

the matching payments. However, to 

ensure fair and consistent 

implementation, in becoming 

‘‘qualified’’ as described under 

§ 1450.101, a biomass conversion 

facility must agree, among other things, 

that all transactions will be market 

based regardless of whether an 

individual or entity will receive a 

matching payment. If it is determined 

by CCC that a person or business has 

restructured or engaged in related party 

transactions for the purpose of defeating 

the intent of BCAP, or to circumvent the 

provisions of this rule and its related 

requirements, or to obtain payment not 

otherwise entitled, then any part of any 

program payment otherwise due or paid 

to such person during the applicable 

period may be required to be refunded 

with interest as determined appropriate 

by CCC. Any eligibility determination 

that was based, in whole or part, on a 

scheme or device will be rescinded. A 

scheme or device includes, but is not 

limited to coercion, fraud, 

misrepresentation, depriving any other 

person of a payment, or obtaining a 

payment that otherwise would not be 

payable. 

Definitions—Socially Disadvantaged 

Farmer or Rancher (§ 1450.2) 

Comment: Include Native Hawaiians 

in the definition of socially 

disadvantaged. 


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Response: The definition has been 

corrected to include Native Hawaiians. 

Definitions—Yard Waste (§ 1450.2) 

Comment: For yard waste, include 

brush and chips, construction and 

demolition and municipal solid wastes, 

and material generated as planned 

management or urban forests. 

Response: The 2008 Farm Bill does 

not explicitly define yard waste. CCC 

considers yard waste to be any 

renewable biomass generated from 

municipal or residential land, such as 

urban forestry materials, construction or 

demolition materials, trimmings from 

grasses and trees, or biomass removed 

due to invasive species or weatherrelated disaster, that can be separated 

from and has low potential (such as 

contamination with plastics, metals, 

chemicals or other toxic compounds 

that cannot be removed) for the 

generation of toxic byproducts resulting 

from conversion, and that otherwise 

cannot be recycled for other purposes 

(such as post-consumer waste paper). 

General (§ 1450.3) 

Comment: There should be stringent 

guidelines to biomass production to 

promote environmental and climate 

sustainability, including provisions to 

prevent over-harvesting, guidelines 

being developed by the Council of 

Sustainable Biomass Production, 

favoring harvesting practices that have 

been recognized as sustainable. 

Response: Eligible material owners 

must obtain conservation plan, forest 

stewardship plan, or equivalent plan in 

order to receive a matching payment. 

The establishment payments and annual 

payments part of BCAP already required 

such plans. These plans address natural 

resource concerns including the 

sustainable harvesting of biomass, when 

appropriate, by addressing the sitespecific needs of the landowner. 

Comment: Matching payments should 

be targeted to certain businesses (for 

example, those with less than 60 

employees) where local ownership and 

local economic benefits are involved, to 

help small town economies and 

encourage investment in infrastructure 

and equipment, so resources can be 

directed to increase plantings of 

biomass crops. 

Response: The 2008 Farm Bill does 

not authorize limiting payments to any 

subset of eligible participants except as 

might be produced by a cap on the 

funding for BCAP or other restrictions 

that flow from the 2008 Farm Bill. The 

statute, however, does require the 

Secretary to consider the opportunity 

for producers and local investors to 

participate in the ownership of the 

biomass conversion facility when 

selecting BCAP project areas. No change 

to the rule was made in response to this 

comment. 

Comment: Target payments to aid the 

development of new sustainable 

biomass used for approved facilities 

such as for newly emerging biomass 

resources that require development of 

specialized equipment for harvest. 

Response: A project sponsor may 

propose a project area to develop new 

sustainable biomass that will be 

considered according to § 1450.202. 

However, BCAP funding is not 

authorized to develop specialized 

harvesting equipment under either the 

matching or establishment and annual 

parts of BCAP. No change to the rule 

was made in response to this comment. 

Comment: The proposed options for 

matching payments would penalize 

early adopters by tying those payments 

to a historical baseline of biomass 

consumption or biomass conversion 

facility output. 

Response: The options in the 

proposed rule that required 

documentation of a historical baseline, 

and paid only for the amount above that 

baseline, were not adopted in this final 

rule. Therefore, we believe that the 

matching payments provisions in this 

rule will not penalize early adopters. 

Violations (§ 1450.4) 

Comment: Strengthen or increase 

penalties for violations. 

Response: This rule has similar 

violation provisions to other CCC and 

FSA programs. The section on 

violations provides remedies up to 

termination of the contract. Other civil 

and criminal actions may also apply as 

they generally apply for other CCC and 

USDA programs. No change to the rule 

was made in response to this comment. 

Scheme or Device (§ 1450.11) 

Comments: Clarify what constitutes a 

‘‘scheme or device.’’ 

Response: A ‘‘scheme or device’’ is 

generally an action that tends to defeat 

the purpose of a program. As specified 

in the regulation, ‘‘A scheme or device 

includes, but is not limited to, coercion, 

fraud, misrepresentation, depriving any 

other person or legal entity of any 

payments, or obtaining a payment that 

otherwise would not be payable.’’ 

Scheme or device determinations are 

made on a case-by-case basis due to the 

unique nature and circumstances 

surrounding specific scenarios or 

actions. BCAP participants who think 

that a particular activity might be 

considered a ‘‘scheme or device’’ should 

seek an official clarification from FSA. 

No change to the rule was made in 

response to this comment. 

Filing of False Claims (§ 1450.12) 

Comments: Establish a formal 

reporting mechanism to report when a 

false claim has been filed. 

Response: There are established 

reporting options. Violations of laws 

and regulations relating to USDA 

programs that may include criminal 

activity such as bribery, smuggling, 

theft, fraud, endangerment of public 

health or safety; mismanagement or 

waste of funds; workplace violence; 

employee misconduct; and conflict of 

interest may be reported by calling (800) 

424–9121, (202) 690–1622, or (202) 690– 

1202 (TDD), by writing to USDA, Office 

of Inspector General, P.O. Box 23399, 

Washington, DC 20026–3399, or by 

e-mailing usda-hotline@oil.usda.gov. No 

change to the rule was made in response 

to this comment. 

Matching Payments in Subpart B 

Comment: Matching payments create 

an uneven playing field for producers 

and consumers of renewable biomass by 

subsidizing existing renewable biomass 

in a way that may delay expansions of 

new biomass crops. 

Response: BCAP provides funding for 

both existing renewable biomass and for 

the establishment of new biomass crops. 

The BCAP regulation requires that 

qualified biomass conversion facilities 

pay a fair market price for biomass. 

Comment: Biomass conversion 

facilities should be eligible material 

owners. 

Response: Biomass conversion 

facilities may be eligible material 

owners if they meet all other 

requirements. 

Comment: Only provide matching 

payments for eligible materials 

converted to advanced biofuels that 

support the Renewable Fuel Standard 

Program of the Energy Independence 

and Security Act of 2007. 

Response: For BCAP, the 2008 Farm 

Bill includes renewable biomass to be 

converted to advanced biofuels as well 

as to be converted to heat, power, and 

biobased products. Where appropriate, 

BCAP is intended to work in harmony 

with other legislation and other Federal 

government programs. The 

programmatic outcomes of BCAP will 

help ensure that the goals of the 

Renewable Fuel Standard Program of 

the Energy Independence and Security 

Act of 2007 are met. No change to the 

rule was made in response to this 

comment. 

Comment: There are ways to limit and 

target the matching payments portion, 

including a national approach where all 


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eligible material owners would be 

eligible to receive matching payments 

regardless of project area boundaries, a 

regional approach that recognizes 

regional differences in renewable 

biomass markets, a local approach that 

limits matching payments to eligible 

material owners within project areas, 

and an eligible material owner cap 

approach that would limit the total 

amount of matching payment funds an 

eligible material owner may receive in 

order to ensure a fair distribution of 

funds among all eligible material 

owners. 

Response: Matching payments are 

available nation-wide regardless of 

project area boundaries. Regional 

markets will be taken into consideration 

when determining if there is the 

potential for eligible material to be used 

to produce a higher-value product. 

Other than the 2-year duration limit on 

payment availability for an eligible 

material owner, there is no authority 

under the 2008 Farm Bill to limit BCAP 

matching payments as the commenters 

suggest. 

Comment: Base matching payments 

language on industry standards, refer to 

and address the major biofuels currently 

in production including ethanol, 

biodiesel, and biojetfuel, and adopt 

standard industry language when 

discussing advanced biofuels. 

Response: The language in this final 

rule is generally based on the 2008 Farm 

Bill language and definitions. The 

purpose of BCAP is to develop a nontraditional crop base of biomass 

feedstocks. The manufacture of biofuels 

in accordance with industry standards 

is outside the scope and authority of 

this rule. No change to the rule was 

made in response to this comment. 

With regards to units of measurement, 

BCAP is a biomass feedstock supply 

program, so it is appropriate for the 

operational units of the program to be 

tons rather than gallons as is more 

common for biofuel programs. For 

example, forest trimmings are not 

conventionally measured in gallons. 

Comment: Is BCAP meeting its stated 

purpose to assist agricultural and forest 

landowners, given the long chain of 

actors (landowners, harvesters, 

aggregators, and facilities) involved in 

the matching payments? 

Response: This rule clarifies 

§ 1450.103 requiring that the eligible 

material must be harvested or collected 

directly from the land by the eligible 

material owner and provides that BCAP 

participants receive a fair market price 

for all eligible material delivered to 

qualified biomass conversion facility. 

Comment: There is not enough 

information collected regarding eligible 

material point-of-origin. The 

administrative burden associated with 

BCAP should be reduced to the extent 

practicable. 

Response: Our goal is only to collect 

the information that is necessary for the 

proper operation and oversight of BCAP 

and to ensure that BCAP payments are 

proper. Therefore, required information 

includes identifying appropriate farm 

and tract information related to the 

source of the eligible material. 

Comment: The matching payments 

should be distributed to all renewable 

biomass producers and consumers, 

maintaining fairness and competition in 

the renewable biomass markets, and 

encouraging long-term investments. 

Response: This rule, which 

implements the authority in the 2008 

Farm Bill, is structured to provide all 

eligible material owners equal 

opportunities to receive matching 

payments, maintain fairness and 

competition, and encourage long-term 

investments in renewable biomass 

markets. No change to the rule was 

made in response to this comment. 

Comment: Redirect the funding for 

matching payments to biomass 

conversion facility equipment 

investments, tax credits, conversion 

processes that show potential in the 

long run, and for upgrading existing 

biomass conversion facilities. 

Response: BCAP funding for those 

activities are not authorized by the 2008 

Farm Bill. 

Comment: Matching payments will 

not be effective in achieving program 

purposes unless new or additional 

activities by existing biomass 

conversion facilities are supported. 

Existing biomass conversion facilities 

will be placed at an unfair disadvantage 

if matching payments support new or 

additional activities rather than all 

activities equally. 

Response: All biomass conversion 

facilities meeting the qualification 

requirements will be approved. No 

change to the rule was made in response 

to this comment. 

Comment: There may be adverse 

environmental impacts of matching 

payments because there is not an 

enforcement mechanism to ensure that 

agricultural and forest resources are 

sustainably harvested on a renewable or 

recurring basis. 

Response: Under this final rule, 

eligible material owners will be required 

to obtain a conservation plan, forest 

stewardship plan, or equivalent plan as 

a condition of receiving a matching 

payment. These plans generally address 

natural resource concerns including the 

sustainable harvesting of biomass, when 

appropriate, by addressing the sitespecific needs of the landowner. The 

plan must include the purpose of the 

harvest, the volume of eligible materials 

to be harvested, the total number of 

acres harvested, and the name of the 

eligible material owner. 

Comments: Woody eligible materials 

should be harvested according to a plan 

supported by the American Loggers 

Council’s Certified Master Logger 

Program. 

Response: Under this final rule, 

eligible material owners will be required 

to obtain a conservation plan, forest 

stewardship plan, or equivalent plan as 

a condition of receiving a matching 

payment. 

Qualified Biomass Conversion Facility 

(§ 1450.101) 

Comment: Why are matching 

payments made to eligible material 

owners rather than to qualified biomass 

conversion facilities? 

Response: The 2008 Farm Bill 

specifies that matching payments be 

made to eligible material owners for the 

collection, harvest, storage, and 

transportation of eligible material to a 

biomass conversion facility. No change 

to the rule was made in response to this 

comment. 

Comment: Favor more efficient or 

advanced conversion processes over less 

efficient or advanced conversion 

processes. 

Response: The purpose of BCAP is to 

develop a non-traditional crop base of 

biomass feedstocks. The manufacture of 

biofuels in accordance with varying 

degrees of conversion efficiency is 

outside the scope and authority of this 

rule. No change to the rule was made in 

response to this comment. 

Comment: Some conversion processes 

that qualified under the NOFA should 

not be allowed to qualify under the final 

rule. Specifically, facilities generating 

power as a byproduct or in support of 

their normal operations or facilities that 

directly convert renewable biomass into 

power should not qualify under the 

final rule. 

Response: The definition of biomass 

conversion facility as specified in the 

2008 Farm Bill specifically includes a 

facility that converts renewable biomass 

into power, so we cannot exclude those 

facilities. Any biomass conversion 

facility that qualified under the NOFA 

will be required to enter into a new 

agreement with CCC that contains 

provisions based on this final rule, 

which reflects changes made in 

response to these and other comments. 

The major changes that will impact the 

agreement include clarifications to the 

collection, harvest, storage, 

transportation and delivery 


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66220 Federal Register / Vol. 75, No. 207 / Wednesday, October 27, 2010 / Rules and Regulations 

requirements in § 1450.103 and removal 

of the ‘‘related-party transaction.’’ Also, 

biomass conversion facilities will be 

required to certify that the eligible 

material for which BCAP payment was 

issued that are not crop residues are 

byproducts of preventative treatments 

that are removed to reduce hazardous 

fuels, to reduce or contain disease or 

insect infestation, or to restore 

ecosystem health. 

Comment: All renewable biomass 

consuming facilities should qualify 

under the final rule, specifically 

including plant nurseries, sawmills, 

anaerobic digesters, particleboard 

facilities, composting facilities, and 

briquette, wood pellet, wood shaving, 

wood chipping, and charcoal producing 

facilities. 

Response: Based on the definition 

specified in the BioPreferred 

Procurement Program, which states that 

products with significant market 

penetration as of 1972 are not 

considered biobased products, then 

plant nurseries, sawmills, particleboard, 

facility, composing facilities, and 

charcoal facilities may not qualify as 

biomass conversion facilities because 

these products do not meet the 

definition. The facilities, however, can 

qualify as biomass conversion facilities 

for purposes of heat, power or biofuels 

generation provided that the eligible 

materials meet the specifications of 

§ 1450.103. No change to the rule was 

made in response to this comment. 

Comment: Provide assistance to 

facilities for marketing biomass 

conversion facility products. 

Response: The 2008 Farm Bill does 

not authorize such assistance. No 

change to the rule was made in response 

to this comment. 

Comment: Biomass conversion 

facilities should offer investment 

opportunity to local producers to help 

keep more of the funding within the 

community. 

Response: There is no requirement in 

the 2008 Farm Bill, and therefore no 

requirement in the rule, to require local 

investment opportunities as a condition 

to become a qualified biomass 

conversion facility. The 2008 Farm Bill, 

however, does require the Secretary to 

consider the opportunity for producers 

and local investors to participate in the 

ownership of the biomass conversion 

facility when selecting BCAP project 

areas. Project proposals submitted under 

Subpart C for the establishment 

payments and annual payments must 

address criteria that consider the 

opportunity for producers and local 

investors to participate in the ownership 

of the biomass conversion facility in the 

proposed BCAP project area. No change 

to the rule was made in response to this 

comment. 

Comment: Legally-binding contracts 

should be required between eligible 

material owners and biomass 

conversion facilities. 

Response: We amended the final rule 

to require a contract, agreement, or 

legally binding letter of intent with an 

application for a matching payment. 

Comment: Verify biomass conversion 

facility procurement practices to ensure 

that biomass conversion facilities allow 

all eligible material owners the 

opportunity to sell eligible material. 

There are concerns due to the ‘‘captive 

market’’ nature of renewable biomass 

supply chains. 

Response: The final rule adds a 

provision that requires biomass 

conversion facilities to pay fair market 

value for eligible material regardless of 

whether the seller has applied for or 

receives a BCAP matching payment. 

Comment: Biomass conversion 

facilities should be allowed to charge a 

BCAP administrative or service fee. 

Response: Charging an administrative, 

service, processing or similar fee 

because an eligible material owner is a 

BCAP participant is not authorized by 

the 2008 Farm Bill. The payment being 

matched should reflect the net output of 

the facility. A payment by the facility of 

$20 with a return of a $5 fee should only 

produce a $15 match since that was the 

actual net outlay to be matched. CCC 

has no authority over the private 

contractual arrangements between an 

eligible material owner and a biomass 

conversion facility. Because the intent 

of BCAP matching payments to eligible 

material owners also provides an 

indirect incentive to facilities to 

consider biomass as an option for heat, 

power, biobased products, or biofuels, it 

is presumed that eligible material 

owners would be disinclined to increase 

the indirect benefit to the facility by the 

payment of an administrative fee. Such 

instances are encouraged to be reported 

to the FSA county office for evaluation. 

Should any arrangement between the 

eligible material owner and the biomass 

conversion facility, however, comprise 

any portion of BCAP matching payment, 

or its equivalent, as determined by CCC, 

it may be considered a scheme or device 

to circumvent the BCAP program and all 

appropriate penalties will ensue. 

Comment: Require a chain-of-custody 

certification using the Forest 

Stewardship Council, Sustainable 

Forestry Initiative Program, or other 

mechanism to demonstrate the 

reliability of the biomass source. 

Response: Establishing chain-ofcustody that would ensure that the 

identity of eligible material would be 

preserved would be overly burdensome. 

Accordingly, this comment was not 

adopted. However, CCC will collect 

farm and tract data through FSA’s farm 

records system to identify the source of 

the eligible material for which a 

matching payment is requested. No 

change to the rule was made in response 

to this comment. 

Comment: Make the biomass 

conversion facility qualification process 

more flexible. For example, reduce 

permit requirements to allow a facility 

to apply for qualification before it is 

operational and when permits are only 

applied for, because feedstock 

development may require several years. 

Response: A biomass conversion 

facility may become qualified before it 

is operational, but only after it obtains 

all necessary permits. No change to the 

rule was made in response to this 

comment. 

Comment: Biofuel companies may 

require farmers to sign long-term 

contracts to ensure low-cost feedstock 

supply. Mills may be dropping payment 

rates due to BCAP matching payments 

by as much as 40 percent while 

landowners are simultaneously raising 

stumpage prices. 

Response: A producers’ decision 

whether to enter into a long-term 

contract with a biofuel company does 

not involve CCC and is outside the 

scope of BCAP. Such a contract between 

a farmer or landowner and a biofuel 

company is a private transaction that is 

separate and distinct from the activities 

and authority of CCC. 

Comment: Biomass conversion 

facilities with gross sales values 

exceeding $25 million should be 

ineligible. 

Response: That restriction on 

eligibility is not authorized by the 2008 

Farm Bill. No change to the rule was 

made in response to this comment. 

Comment: There were many 

comments about the standards for 

moisture content and measurement that 

did not represent a consensus. 

Suggested approaches included 

adopting industry standards for 

moisture content, adopting standard 

moisture contents of 45–50 percent, 

real-time moisture testing, testing of 

every load, and randomly testing 

moisture contents. Recommendations 

on measuring moisture content included 

taking regional, weekly, monthly, 

quarterly, bi-annual, and annual 

moisture averages. 

Response: The proposed rule and this 

final rule include provisions for 

matching payments to be adjusted to a 

‘‘dry ton’’ basis. This ensures that the 

many different kinds of eligible material 

are treated similarly. Because of the 


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significant differences between types of 

eligible materials, industry practices, 

and the potential for technological 

change, specific moisture measurement 

protocols are not specified in the BCAP 

regulation. No change was made to the 

final rule as a result of this comment. 

CCC believes that specifying the 

technology or methods used to measure 

dry tons is unnecessarily limiting and 

not required. 

Comment: The exclusion of satellite 

delivery sites or biomass conversion 

operations from BCAP participation 

creates a competitive disadvantage for 

biomass conversion facilities with offsite chipping facilities. 

Response: Satellite delivery sites may 

be an important component of certain 

biomass conversion facilities and we 

will consider materials delivered to a 

satellite facility of a conversion facility 

as delivered to the facility. All other 

eligibility conditions for eligible 

material will continue to apply. 

Eligible Material Owner (§ 1450.102) 

Comment: Loggers who are not BCAP 

participants need a way to recover lost 

revenue if the market responds to BCAP 

by lowering the cost of biomass 

feedstock. 

Response: The requirements in this 

section for eligible material owner are 

specified in the 2008 Farm Bill. If 

loggers meet the definition of eligible 

material owner, they are eligible for 

BCAP. The purpose of BCAP is to 

develop a non-traditional crop base of 

biomass feedstocks. The revenue of 

participants and non-participants is 

outside the scope and authority of this 

rule. 

Comment: The eligibility of eligible 

material owners should be tied to the 

person that can present legal title for 

harvest and transport of material. 

Response: An eligible material owner 

is one who has the right to collect or 

harvest the eligible material, as 

specified in this rule with the risk of 

loss in the product. As specified further 

in § 1450.3, ‘‘Eligible Material,’’ the 

material must have been harvested or 

collected directly from the land. 

Language about risk of loss has been 

added. 

Comment: There should be a 

definition for ‘‘related-parties.’’ The 

restrictions on related party transactions 

are not authorized by the 2008 Farm 

Bill. Some commenters provided 

alternative definitions for ‘‘related party’’ 

and ‘‘related party transaction.’’ Others 

suggested exceptions that should apply 

to the ‘‘related parties’’ provisions. 

Response: This rule removes all 

references to ‘‘related-party 

transactions.’’ CCC has replaced 

references to ‘‘related-party transactions’’ 

with a requirement at § 1450.103 for 

market-based transactions to provide 

that a facility may not pay different rates 

for the same product based on whether 

the seller is participating in BCAP or 

pay inflated rates for whatever reason. 

Eligible Material (§ 1450.103) 

Comment: Oppose CCC discretion to 

modify the definition of eligible 

material when determining whether 

specific materials are eligible for 

matching payments and subsequent 

placement on the eligible materials list. 

Response: Determining whether a 

specific material is on the eligible 

materials list is not a modification of the 

definition. CCC does not have the 

discretion to modify the 2008 Farm Bill 

definition of eligible material. The 2008 

Farm Bill defines eligible material as 

renewable biomass, with a number of 

exceptions. As we did for the NOFA, we 

intend to continue consulting with 

USDA experts and other stakeholders 

when evaluating whether a specific 

material should be considered an 

eligible material, within the 2008 Farm 

Bill definition. 

Comments: Commenters had various 

suggestions for eligible materials. 

Include Title I crop residues as 

eligible for matching payments. 

Corn stover and sugarcane bagasse 

should be eligible for matching 

payments. 

Corn stover, wheat straw, and rice 

hulls should not be eligible for matching 

payments. 

Response: The 2008 Farm Bill 

excludes from eligible material those 

crops that are eligible for assistance 

under Title I; however, this exclusion 

applies only to the commodity itself and 

not to any crop residue associated with 

producing that commodity. For 

example, corn grain is excluded from 

receiving matching payments, but, 

provided that it is otherwise eligible, 

other parts of the corn plant may be 

eligible for a BCAP matching payment. 

Title I crop residues that are separated 

from the Title I grain, kernel, or oilseed 

at the point of collection or harvest are 

eligible for matching payments; 

however, crop residues that are 

separated from the Title I grain, kernel, 

or oilseed after the crop is collected or 

harvested are not eligible for matching 

payments. No change to the rule was 

made in response to this comment. 

Bagasse, corn stover, wheat straw, and 

rice hulls are eligible if they are 

collected, harvested, transported, and 

delivered as specified in the BCAP 

regulations; see the table above for 

details about when these materials may 

be eligible versus ineligible. The 

separation must have occurred on the 

land and not occurred because the 

material would normally have been 

delivered along with the higher valued 

parts of the plant. 

Comment: CCC should consider nonTitle I materials as eligible for matching 

payments including dried distillers 

grains, nut shells, energy cane, and 

sweet or high-biomass sorghum. 

CCC should propose a formal process 

for determining which eligible materials 

may otherwise be used for higher-value 

products and the processes would 

include consultation with State 

Foresters. 

Response: The 2008 Farm Bill 

provides the definition for eligible 

material. CCC will provide a public list 

of eligible materials that meet the 2008 

Farm Bill definition of eligible material, 

specifying which qualify for BCAP 

payments, and will make that list 

available electronically and through 

FSA field offices. When new materials 

are proposed, such as, nut shells, energy 

cane, and sweet or high-biomass 

sorghum, FSA will consult other USDA 

and Federal agency experts to determine 

whether the new materials are additions 

to the eligible materials list and whether 

or not they qualify for BCAP payment. 

No change to the rule was made in 

response to this comment. 

Comment: Materials from urban 

sources should not be considered yard 

waste including: tree trimmings, 

disaster debris, and pallets. 

Response: BCAP’s purpose is 

generally limited to agricultural and 

forest land owners and operators for 

matching payment purposes. No change 

to the rule was made in response to this 

comment, because the rule already 

excludes yard waste from any source as 

an eligible material. 

Comment: Need clarification on 

eligible materials that may otherwise be 

used for higher-value products, such as 

forest thinning materials, bark, slash, 

wood chips (hard and soft), wood waste, 

and wood residues (including sawdust), 

some of which should be eligible to 

receive a matching payment. 

Response: We expanded and clarified 

the provisions in § 1450.103 in response 

to this comment. Otherwise eligible 

materials that may be used to produce 

higher-value products do not qualify for 

matching payments under the final rule 

regardless of whether the material 

comes from Federal or non-Federal 

land. Payments are not authorized for 

otherwise eligible materials if they must 

be separated from a higher-value 

product after delivery to the biomass 

conversion facility. In many cases, wood 

waste materials would not be eligible 

because they could be used for higherVerDate Mar<15>2010 18:21 Oct 26, 2010 Jkt 223001 PO 00000 Frm 00021 Fmt 4701 Sfmt 4700 E:\FR\FM\27OCR2.SGM 27OCR2

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value products or are included with 

non-organic industrial materials. Local 

or regional markets will be used to 

determine if particular deliveries will be 

eligible for BCAP matching payments. 

Comment: There should be partial 

payments for eligible materials that are 

comingled with ineligible material. How 

will partial payments for comingled 

loads be verified? 

Response: This rule adds a 

requirement to § 1450.103 that 

payments are not authorized for 

otherwise eligible material that must be 

separated from a higher-value product 

after delivery to a biomass conversion 

facility. 

Comment: Eligible material owners 

that violate Executive Order 13112 on 

Invasive Species should not be 

responsible for the removal costs 

associated with the spread or 

establishment of noxious or invasive 

species as a result of activities related to 

receiving matching payments. 

Response: As a condition of applying 

for a matching payment, an eligible 

material owner must obtain a 

conservation plan, forest stewardship 

plan, or equivalent plan. Violation of 

Executive Order 13112 would be 

considered a violation of the plan. No 

change to the rule was made in response 

to this comment. The issue of removal 

costs is outside the scope of BCAP; 

material owners who violate Executive 

Order 13112 may be subject to penalties 

under State or other Federal laws. 

Comment: The eligible materials list 

should be published in the final rule. 

Response: We included an example 

list of how eligible materials qualify for 

payment. As discussed above, the up to 

date list will be publicly available 

through the FSA Web site and at FSA 

county offices. Instead, this rule 

provides the criteria upon which 

decisions will be made to determine 

whether a material is an eligible 

material and whether or not it qualifies 

for BCAP payments and the responses to 

comments in this final rule clarify 

examples already determined to be 

eligible or ineligible. No change to the 

rule was made in response to this 

comment. 

Comments: Include black liquor as an 

eligible material and as an advanced 

biofuel. 

Response: Black liquor, an inorganic 

waste industrial by-product of the kraft 

process used in pulp manufacturing, is 

a product that historically was 

discharged into waterways, and today is 

processed through recovery boilers to 

retrieve chemicals for cost-efficiency 

purposes, with the process generating 

heat for power. The establishment of 

BCAP in the 2008 Farm Bill was 

designed to cultivate a new nationwide 

crop base of non-food, non-feed biomass 

for new uses of energy. Black liquor is 

not an eligible or ineligible material, it 

is not a feedstock, but rather a product 

of feedstocks. Eligible materials that can 

be attributed to the creation of black 

liquor are materials that were delivered 

principally for the manufacture of a 

higher-value product that is not heat, 

power, biobased products, or biofuels, 

not for the recovery of chemicals where 

energy is an ancillary side effect and 

therefore do not qualify for matching 

payments. 

Signup (§ 1450.104) 

Comments: Use qualified biomass 

conversion facility settlement sheets to 

issue matching payments rather than 

documents provided by the eligible 

material owner. 

Response: As with other FSA and 

CCC programs, the recipient of the 

payment is responsible for the accuracy 

and completeness of the information on 

the application for payment. As 

specified in this rule, a settlement sheet 

is one of the pieces of documentation 

that an eligible material owner must 

provide to FSA to receive payment. 

Qualified biomass conversion facilities 

are required to retain all documentation 

for a period of 3 years from the date of 

delivery should it become necessary for 

auditing or other purposes to validate 

data. No change to the rule was made in 

response to this comment. 

Comments: There should be a 2 week 

signup period each quarter for matching 

payments. 

Response: Having a continuous 

signup is more flexible for eligible 

material owners accommodates seasonal 

and geographic differences in the local 

marketplace and permits county offices 

to better manage heavy workloads. No 

change to the rule was made in response 

to this comment. 

Payments (§ 1450.106) 

Comment: Spatial distance should be 

considered when determining matching 

payment rates. 

Response: The 2008 Farm Bill 

requires that payment be made based on 

the payment made by the biomass 

conversion facility, with no provision 

for an additional requirement that the 

material be harvested within a certain 

distance of the facility. No change to the 

rule was made in response to this 

comment. 

Comment: Allocate funds quarterly to 

ensure equal distribution of funds 

across all quarters. Only approve 

requests for payments for sales receipts 

within one year from the date the 

receipt was issued. Extensions should 

be considered for contracts when 

delivery was delayed at no fault of the 

eligible material owner. 

Response: When the final rule 

becomes effective, FSA intends to begin 

regular allocations of funding to meet 

local needs. When an application is 

submitted, the approval will provide a 

reasonable period of time for biomass 

deliveries, after which, the approval 

may be withdrawn and the funds deobligated. Where appropriate, FSA 

county offices will consider extension 

requests to the dates of delivery that 

were included in the application. No 

change to the rule was made in response 

to this comment. 

Comment: CCC should issue early 

partial payments for large volume 

contracts. 

Response: Partial payments will be 

authorized for discrete, segregable 

deliveries that are part of a single 

application. Payments, or payment 

advances, are prohibited before the 

delivery period starts, or before proof of 

payment for delivery is presented to the 

FSA county office. No change to the rule 

was made in response to this comment. 

Comments: Commenters had various 

suggestions related to the 2-year 

payment period for matching payments. 

CCC should address an eligible 

material owner’s lost time due to the 

NOFA termination. 

CCC should start the 2-year clock of 

all eligible material owners, or at least 

stop the clock on the date the proposed 

rule was published or the last date of 

performance, whichever was later. 

CCC should make the 2-year period 

shorter. CCC should extend the time 

period to 3 to 7 years. 

Response: The 2008 Farm Bill 

requires a payment limit of 2 years, 

which is not changing with this rule. 

Payments will be for a term not to 

exceed 2 years beginning from the date 

that CCC issues the first payment. New 

participants will be eligible for 

payments for a period of 2 years 

beginning from the date their first 

matching payment is made after the 

effective date of this rule. CCC will 

determine how to take into account 

participants during the NOFA period. 

At the least, the 2-year period will be 

considered stopped during the period 

between the end of matching payments 

received during the NOFA and the 

beginning of CCC matching payments 

for new deliveries by the participant. 

Anyone who wants to participate in 

BCAP, including eligible material 

owners and biomass conversion facility 

owners, will need to apply under the 

BCAP regulations, no one will be 

grandfathered in based on applications 

approved under the NOFA. 


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The authorizing statute provides for a 

2-year limitation on matching payments; 

no additional limitations are authorized. 

Efforts by BCAP participants to 

restructure after the 2-year limitation 

expires in order to obtain additional 

matching payments may be considered 

a scheme or device and may result in 

permanent debarment from BCAP. If it 

is determined by CCC that a person or 

business has restructured or engaged in 

related party transactions for the 

purpose of, or having the effect of, 

defeating the intent of BCAP (including 

an action to defeat the 2-year limit on 

payments), or to circumvent the 

provisions of this rule and its related 

requirements, or to obtain payment not 

otherwise entitled, then any part of any 

program payment otherwise due or paid 

to such person during the applicable 

period may be required to be refunded 

with interest as determined appropriate 

by CCC. Any eligibility determination 

that was based, in whole or part, on a 

scheme or device will be rescinded. A 

scheme or device includes, but is not 

limited to coercion, fraud, 

misrepresentation, depriving any other 

person of a payment, or obtaining a 

payment that otherwise would not be 

payable. 

Comment: Reduce the $45 per dry ton 

payment limit to $30 per dry ton. 

Response: The 2008 Farm Bill 

provides that the upper limit on 

matching payments be ‘‘* * * equal to 

not more than $45 per ton.’’ CCC will 

issue payments at rates lower than $45 

per ton where local market prices reflect 

lower rates—hence the term ‘‘matching 

payments.’’ No change to the rule was 

made in response to this comment. 

Comment: The proposed rule 

included several options for calculating 

payments. Commenters had various 

suggestions for all three options, as well 

as suggestions for alternative rate 

structures including structures to favor 

dedicated energy crops, based on 

greenhouse gas reductions, fossil fuel 

displacement, whether the materials 

were derived from land with a 

conservation plan, forest stewardship 

plan, or equivalent plan and based on 

biomass conversion facility output. 

Some commenters suggested giving 

‘‘bonus payments’’ for eligible materials 

that are carbon neutral or negative. 

Commenters also suggested 

implementing a price floor or minimum 

that biomass conversion facilities must 

pay to eligible material owners. 

Response: The rule reflects that the 

2008 Farm Bill provides for matching 

payments to be paid at a rate of $1 for 

each $1 per dry ton provided by a 

qualified biomass conversion facility for 

the market-based sale of eligible 

material in an amount not to exceed up 

to $45 per dry ton. There are no tiered 

payments based on type of biomass or 

on use above a historical baseline. 

Comment: Matching payments should 

be based on the actual ‘‘collection, 

harvest, storage and transportation 

costs’’ of eligible materials rather than 

the biomass conversion facility gate 

price of eligible materials. 

Response: The 2008 Farm Bill 

requires that payments be based on 

matching the amount paid by a qualified 

biomass conversion facility. No change 

to the rule was made in response to this 

comment. 

Establishment Payments and Annual 

Payments in Subpart C 

General (§ 1450.200) 

Comment: Please clarify the time 

frame in which contract acreage is 

expected to become enrolled in BCAP. 

Response: Eligible persons may 

signup eligible land into contract 

acreage once a project area is approved. 

The exact time frame for when signup 

will occur will vary based on the 

amount of time project sponsors need to 

submit a project area proposal and the 

level of technical and environmental 

review required for the project area 

proposal. 

Comment: Clarify whether land 

enrolled in contract acreage will be 

eligible to receive base-acre payments 

under the Direct and Counter-Cyclical 

Payment Program (DCP). 

Response: BCAP does not prohibit 

participation in other programs; 

however, requirements of other 

programs may apply. In the case of DCP, 

contract acreage is considered to be an 

acceptable agricultural use of DCP 

cropland. 

Comment: CCC should discuss the 

process for determining the appropriate 

number of project areas that will be 

selected and how that process relates to 

the findings of the PEIS. 

Response: As indicated in the 

preamble to the proposed rule, we 

indicated that all project proposals 

would be considered acceptable 

provided those proposals met the 

selection criteria outlined in § 1450.202. 

The PEIS included an in-depth 

discussion of the selection criteria and 

can be located at this Web address: 

http://www.fsa.usda.gov/Internet/FSA_

File/bcapfinalpeis062510.pdf. 

Comment: BCAP project areas should 

have additional goals, including 

providing additional wildlife habitat, 

increasing resources and opportunities 

to small- and mid-sized farms, and 

encouraging the establishment of several 

categories of potential eligible crops 

including native grasses and trees, 

dedicated annual and perennial energy 

crops, only dedicated perennial crops, 

short-rotation woody crops, and crops 

that are ecologically appropriate based 

on the geographic location of the project 

area. 

Response: These additional goals are 

largely compatible with the BCAP as 

specified in this final rule. Land 

enrolled under a BCAP contract may be 

capable of producing multiple benefits 

including additional wildlife habitat 

and additional resources and 

opportunities to agricultural and forest 

land owners. BCAP, however, is not a 

wildlife or conservation program as is 

CRP, rather BCAP is to promote the 

establishment and cultivation of new 

biomass crops. 

Comment: Apply the project area 

selection criteria to evaluate offers to 

enroll land into BCAP contracts. 

Response: We expect project areas to 

cover all or parts of multiple counties. 

Applying potentially multi-county 

project area criteria to individual offers 

from the farm level would impose an 

undue administrative burden on USDA 

as well as individual farmers and 

ranchers. Therefore, this suggestion was 

not adopted. 

Comment: There are better ways to 

select project proposals. Some 

alternatives include: (1) First-come, 

first-serve; (2) all eligible land within 

100 miles of a qualified biomass 

conversion facility; (3) a regional 

approach to ensure an even distribution 

of project areas across the country; (4) 

a competitive approach to ensure the 

best project areas are selected; and (5) a 

nation-wide project area that allows all 

eligible producers to enter into a BCAP 

contract. 

Response: The first approach, firstcome first-serve, is similar to the 

approach as described in the proposed 

rule except that project area proposals 

would also be required to meet the 

requirements of the selection criteria as 

provided in § 1450.202. 

Requiring a distance-based model 

arbitrarily limits enrollment even if 

there were potential participants beyond 

that distance who wanted to participate. 

It is not clear if the comment intended 

to address what seems to be a natural 

barrier due to the transportation costs 

involved. However, setting an arbitrary 

distance may work well in some 

regions, but preclude promising 

technologies and feedstocks elsewhere. 

With respect to the regional approach 

to ensure an ‘‘even distribution,’’ this 

would only be an issue if there was a 

competitive evaluation comparing 

merits of all project area proposals. 


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It is also important to note that the 

key criteria for a project area proposal 

is having an established or planned 

biomass conversion facility in or near 

the area. It is not clear how having a 

nation-wide project is compatible with 

this criteria. No change to the rule was 

made in response to this comment. 

Comment: Contract acreage will 

compete for land that produces food and 

feed. It will also compete with land that 

is native wildlife habitat, specifically 

land enrolled or potentially enrolled in 

CRP (7 CFR part 1410). 

Response: While BCAP-eligible land 

within project areas could conceivably 

be used to grow food or used for wildlife 

habitat, growing dedicated energy crops 

instead, is unlikely to have a 

discernable adverse impact on food 

markets or the environment for several 

reasons. First, dedicated energy crops 

are relatively well suited for cultivation 

on marginal crop and pasturelands, 

which, by definition, do not 

significantly contribute to food 

production. Second, recent trends in 

grain supplies suggest that they are not 

being driven primarily by biomass 

feedstock production. Third, U.S. food 

prices are only marginally impacted by 

changes in grain prices when they do 

occur. Fourth, BCAP may motivate a 

shift away from fossil fuels, as well as 

from corn-based ethanol as a means by 

which to satisfy the standards 

referenced above that will favorably 

impact environmental quality. Fifth, it 

is true that some marginal land that 

could otherwise be enrolled in CRP may 

be enrolled in BCAP instead. However, 

research has shown actively managed 

dedicated energy crops also confer 

significant wildlife benefits. Further, the 

conservation, forest, or equivalent plans 

required for BCAP-eligible land will 

serve to mitigate any adverse impacts 

from dedicated energy crop production. 

Each project will be reviewed 

individually to provide maximum 

consideration of the costs and effects, 

including environmental effects, of the 

project. No change to the rule was made 

in response to this comment. 

Comment: BCAP may cause shortages 

of seed stock necessary to establish 

dedicated energy crops. 

Response: Under CRP, early 

enrollments created a demand for 

vegetative and tree covers that exceeded 

the available supply. Then, the seed 

trade mobilized to develop, market, and 

sell seed to meet the demand. We expect 

a similar response under BCAP. 

Comment: There is a difficult, 

expensive time-lag associated with 

establishing and harvesting dedicated 

energy crops. 

Response: Yes, there will be a period 

of time before eligible crops can be 

harvested according to a conservation 

plan, forest stewardship plan, or 

equivalent plan. That is why there are 

annual payments. However, 

fundamentally, establishing a renewable 

energy crop is as much subject to 

conditions beyond farmers’ control as 

establishing any other vegetative or tree 

cover; the risks of growing crops are not 

unique to BCAP. 

Comment: Will matching payments be 

available to producers with land 

enrolled under a BCAP contract at time 

of harvest? 

Response: As provided in this rule, 

matching payments are available for 

eligible materials harvested from land 

enrolled under a BCAP contract after the 

materials have been delivered to the 

biomass conversion facility. There will 

be a reduction to the annual payment 

based on a percentage (1 percent to 100 

percent) of the matching payment and 

sale price received, as specified in this 

rule. In no case will the reduction be 

greater than the annual payment. 

Project Area Submission Requirements 

(§ 1450.201) 

Comment: We oppose the sufficient 

equity requirement for project areas. 

Provide more clarification about it. 

Response: The 2008 Farm Bill states 

that sufficient equity must be 

demonstrated by a biomass conversion 

facility that is not operational at the 

time the project area proposal is 

submitted, so this rule includes the 

provision. Demonstration of sufficient 

equity can be included in the project 

area proposal as part of the business 

feasibility description, which may 

include items such as an outline of 

efforts made toward securing financing, 

facility specifications, or projected 

operating costs. For further clarification 

on specific cases, please contact your 

FSA county office. 

Comment: An FSA representative 

should be available to provide support 

for groups intending to sponsor a project 

area because the proposed language is 

unclear and would be difficult to 

consistently implement. 

Response: The commenters did not 

provide detailed information describing 

how the proposed rule was unclear. 

FSA county office employees will be 

available to assist project sponsors in 

developing proposals. 

Comment: Include the production of 

eligible material as selection criteria for 

project areas. 

Response: It is unclear what purpose 

this would serve, except to promote 

only establishment of eligible materials, 

rather than the wider group of 

renewable biomass. The 2008 Farm Bill 

is clear that one purpose of the 

establishment payments part of BCAP is 

to promote the establishment of the 

wider group of renewable biomass. 

Comment: There should be a longer 

plant establishment timeframe. 

Response: CCC has extensive 

experience with establishing vegetative 

and tree covers under CRP, which we 

used in developing BCAP. Under CRP, 

as well as BCAP, CCC requires that 

practices be established within 3 years 

for longer-term practices. Under BCAP, 

the establishment time for annual and 

non-woody perennial crops is reduced 

because the contract duration is 

significantly less than CRP. In all cases, 

CCC takes into consideration the 

circumstances where cover 

establishment is delayed through no 

fault of the contract participant. No 

change to the rule was made in response 

to this comment. 

Comment: Project sponsors should 

identify other potential local sources of 

biomass so that proposals could be 

evaluated in the context of local 

biomass availability and demand. 

Response: We amended the regulation 

in § 1450.201(a)(1) to clarify that it is 

required. 

Comment: Project sponsors should 

identify proposed feedstocks (including 

crop mixes) they plan to use, what land 

types biomass will be sourced from, and 

expected production. 

Response: Under § 1450.201(a), 

project sponsors must provide a 

description of the eligible land and 

eligible crops with a proposed project 

area. 

Comment: Only require general 

information about acres targeted for 

planting, such as general region, land 

history, current use and acres that will 

not be planted. Project area boundaries 

should be used to document current 

land use, eligible crops, and cropland 

and projected land use change, rather 

than on a more detailed producer basis. 

Response: The 2008 Farm Bill 

requires a description of the eligible 

land and eligible crops ‘‘of each 

producer’’ that will participate in the 

proposed project area. However, we 

recognize that a project proposal cannot 

assume future participation. CCC will 

only require a generalized assessment of 

eligible land and eligible crops in 

project area proposals. 

Further, project sponsors must 

provide sufficient information for us to 

determine whether the requirements of 

§§ 1450.201 and 1450.202 have been 

met. Incomplete proposals will be 

returned to the project sponsor, but may 

be resubmitted. No change to the rule 

was made in response to this comment. 


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Comment: Project sponsors should 

provide information on conservation 

plans, forest stewardship plans, or 

equivalent plans and should consult 

with State Forester to determine scope 

and scale of the plan needed. 

Response: Project sponsors are not 

required to do so, but all producers who 

have a BCAP contract in the project area 

will be required to have such a plan. It 

is not reasonable to require project 

sponsors to develop such a plan for the 

large geographic area covered by the 

project area, much of which may not be 

under BCAP contracts. One of the 

criteria used to select project areas, as 

specified in this rule, is the impact on 

soil, water, and related resources. 

Comment: Project sponsors should 

have a business plan and an economic 

feasibility study and a summary of 

where and how the energy will be 

marketed. Add a selection criterion to 

show that the business plan is 

sustainable. Project sponsors should 

consult with State sustainable biomass 

planting and harvesting guidelines. 

Response: The purpose of BCAP is to 

develop a non-traditional crop base of 

biomass feedstocks. Project area 

proposals reuqis a business feasibility 

description. Requiring project sponsors 

to submit economic feasibility studies, 

marketing plans and business plans 

does not appear necessary and could 

add an undue burden of cost which 

could discourage worthwhile 

participation in BCAP. No change to the 

rule was made in response to this 

comment. Producers in BCAP project 

areas, however, are required to have 

conservation plan, forest stewardship 

plan, or equivalent plan, and one of the 

criteria used to select project areas, as 

required by statute, is the impact on 

soil, water, and related resources. 

Comment: Long-term should be 

defined as a 7-year minimum, to 

support biomass conversion facility 

viability. 

Response: Defining what would be 

considered ‘‘long term’’ with a specific 

time would arbitrarily disadvantage 

some proposals that may otherwise have 

promising technological or feedstock 

viability. The viability of the conversion 

facilities will be reviewed on a case-bycase basis. No change to the rule was 

made in response to this comment. 

Comment: Project sponsors should 

lead information gathering and 

communication with CCC. 

Response: After approval of a project 

area, FSA county offices will work 

directly with farmers and ranchers to 

enter into contracts, make payments, 

ensure contract terms are followed, and 

other duties similar to the other 

programs that FSA provides to farmers. 

No change to the rule was made in 

response to this comment. 

Comment: Proposals should include 

protocols to be used by the facility in 

verification and audits of plan 

compliance. 

Response: There were no detailed 

recommendations accompanying this 

suggestion; however, biomass 

conversion facilities that become 

qualified under Subpart B and 

producers enrolling in BCAP contract 

may be reviewed or audited by FSA as 

appropriate. No change to the rule was 

made in response to this comment. 

Comment: Additional information 

should be provided to outline and 

simplify project area submission 

requirements. This may include 

information regarding acceptable project 

area sizes, how a proposal may 

‘‘demonstrate’’ each submission 

requirement, and requiring a description 

of eligible land and eligible crops. 

Response: Project area proposals will 

inherently be unique depending on 

what the project sponsor chooses to 

propose. Providing a template that 

applies to all potential issues and 

variability across the country will 

arbitrarily exclude proposals for 

technologies and feedstocks that could 

delay achieving the goals of the 

renewable fuel standard. No change to 

the rule was made in response to this 

comment. 

Comment: Simplify proposal criteria 

to facilitate a single facility or group of 

facilities (with no intention of farming 

crop), to organize and submit a 

proposal, without which such groups 

may be unable to submit project area 

proposals. 

Response: The submission 

requirements in this rule do not prohibit 

a proposal submitted by multiple 

facilities. There is no restriction on 

project area proposals by groups or for 

groups of facilities. FSA designed the 

proposal criteria to meet the 

requirements of the 2008 Farm Bill, for 

the effective implementation of BCAP, 

and to minimize the burden on 

respondents. 

Comment: There should be a 

‘‘conditional approval’’ status for 

potential BCAP project areas that meet 

the basic requirements for a project area, 

with final approval being contingent 

upon requirements to fund the projects, 

obtain contracts, and other provisions. 

Response: FSA’s intention is to 

approve project areas that meet the 

requirements of § 1450.202 and to 

provide additional support and 

guidance at the FSA county office level 

so that contracts can be entered into at 

the appropriate time. No change to the 

rule was made in response to this 

comment. 

Project Area Selection Criteria 

(§ 1450.202) 

Comment: All alternative energy 

programs should target local ownership. 

Response: The establishment 

payments and annual payments part of 

BCAP will target local ownership. 

Opportunity for local investors to 

participate in ownership of the biomass 

conversion facility will be considered in 

evaluating project area proposals. No 

change to the rule was made in response 

to this comment. 

Comment: The selection criteria 

regarding the ‘‘variety of biomass 

production approaches within a project 

area’’ may negatively impact biomass 

conversion facilities using a single 

eligible crop for conversion to 

bioenergy. 

Response: The 2008 Farm Bill 

specifies this criteria; it requires 

consideration of proposals using this 

criteria, in addition to the other criteria. 

A project area proposal that is strong on 

the other criteria, but only proposes a 

single eligible crop should not be 

negatively impacted. 

Comment: Clarify the weighting and 

evaluating of the project area selection 

criteria. 

Response: The 2008 Farm Bill 

specifies the criteria that will be used to 

select project proposals. CCC will 

evaluate the proposals in coordination 

with technical experts based on relevant 

technical standards. The weighting of 

the factors will vary over time as BCAP 

matures. No change to the rule was 

made in response to this comment. 

Comment: Clarify how the definition 

of a BCAP project area is related to the 

project area selection criteria and 

specifically what distance is considered 

‘‘economically viable.’’ 

Response: Delineating the project area 

is one of the project area submission 

requirements under § 1450.202. A 

geographic delineation outlines the 

eligible area for enrollment in a BCAP 

contract and provides the basis for 

performance reporting, monitoring, and 

evaluation. The distance for ‘‘economic 

viability’’ will vary depending on local 

conditions. Absent geography, the 

distance is generally set by 

transportation costs to move eligible 

material from the farm to the biomass 

conversion facilities. This distance may 

also vary over time depending on the 

relative costs of transportation. Also, 

natural formations such as rivers, lakes, 

and mountains also serve as geographic 

barriers. There is no specific distance 

that will automatically be considered to 

represent the limit for economically 


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viable. No change to the rule was made 

in response to this comment. The 

project sponsor will propose what will 

be economically viable based on their 

geographic location, their proposal, and 

the eligible crops. 

Comment: Consider the following 

environmental impacts as project area 

selection criteria: positive and negative 

indirect impacts such as land-use 

change and landscape fragmentation, 

long-term impacts on natural resources 

such as water, carbon, and wildlife, 

agronomic considerations such as 

genetic diversity of crops, sustainability 

of annual versus perennial crops, and 

whether or not the crops are native or 

are ecologically appropriate to the 

project area. 

Response: The purpose of BCAP is to 

promote the cultivation of annual and 

perennial crops that are not primarily 

grown for food or animal feed. The 

proposed rule and the final PEIS listed 

the minimum selection criteria 

developed for participation in the BCAP 

project area. The selection criteria seek 

to address: (1) The amount of feedstock 

available from multiple sources and 

grown through multiple techniques to 

supply a biomass conversion facility; (2) 

the potential economic impact within 

the project area; (3) the potential for 

local investment in the biomass 

conversion facility; and (4) participation 

by socially disadvantaged producers. 

We also must assess the impact on soil, 

water, and related resources. We may 

also take into account other selection 

criteria, as appropriate. Additional 

selection criteria may be developed, if 

necessary, at the national level or on a 

region-by-region basis, depending on 

the need and flexibility of specific areas 

to change. 

The cumulative effects within each 

project area would be addressed through 

the site-specific environmental 

screening and resulting NEPA analysis 

at the appropriate level (that is, 

categorical exclusion, environmental 

assessment, or environmental impact 

statement). The appropriate level of 

NEPA analysis would include an 

assessment of the potential effects to 

wildlife, including landscape or habitat 

fragmentation; water quality and 

quantity; and soil carbon. Some of the 

potential impacts cannot be fully 

assessed due to conflicting 

methodologies for the assessment of 

some areas or lack of sufficient data to 

make appropriate determinations, such 

as indirect land-use changes and lifecycle analysis of new crop types. The 

genetic diversity of crop types is 

primarily assessed through USDA’s 

Animal and Plant Health Inspection 

Service on-going testing, field trials, and 

NEPA analyses of new crop varieties 

and introduced plant species for 

commercial uses. Also, local State 

technical committees, in association 

with State-level agencies that regulate 

invasive species will have input on the 

plant species that would be considered 

invasive or noxious within each State, 

limiting the overall pool of potential 

candidate species for dedicated energy 

crop production. Therefore, BCAP as 

specified in the final rule addresses this 

comment. No change to the rule was 

made in response to this comment. 

Comment: Target local ownership and 

economic benefits and benefits to 

socially disadvantaged and beginning 

farmers and ranchers as project 

selection criteria. 

Response: These selection criteria are 

specifically included in the rule. 

Comment: Allow BCAP project area 

boundaries to be modified to allow 

additional producers to enter into BCAP 

contracts after a project area has been 

selected. 

Response: BCAP project area 

boundaries may be modified by the 

project sponsor post-project area 

approval; however, additional 

environmental review may be necessary 

if such modifications significantly 

deviate from the initial scope of the 

original approved BCAP project area. 

Eligible Persons and Legal Entities 

(§ 1450.203) 

Comment: Use the NOFA definition of 

‘‘foreign entity.’’ 

Response: The 2008 Farm Bill does 

not preclude participation in BCAP by 

foreign entities. Accordingly, foreign 

entities may participate in BCAP 

provided they are otherwise eligible. No 

change to the rule was made in response 

to this comment. 

Comment: Clarify the terms ‘‘eligible 

persons’’ and ‘‘legal entities.’’ 

Response: The terms ‘‘person’’ and 

‘‘legal entity’’ are defined in 7 CFR part 

1400. For ease of administration and 

consistency with other CCC programs, a 

reference to the definitions found at 7 

CFR part 1400 was added to this rule in 

the Definitions section. 

Eligible Land (§ 1450.204) 

Comments: Is native sod ever eligible 

land? 

Response: CCC has offered greater 

clarification in this rule to identify 

native sod as ineligible land for contract 

acreage in project areas. ‘‘Native sod’’ is 

defined in this rule as land that has 

never been tilled for the production of 

an annual crop as of June 18, 2008, 

which was the date of enactment of the 

2008 Farm Bill. This definition of native 

sod may affect large portions of 

rangelands that have never been tilled 

and on which the plant cover is 

composed principally of native grasses, 

grasslike plants, forbs, or shrubs suitable 

for grazing and browsing. This rule 

corrects the date for native sod from the 

effective date of this rule to the date of 

the enactment of the 2008 Farm Bill. 

Comments: Consider land not in 

agricultural production to be eligible 

land. 

Response: For BCAP, the 2008 Farm 

Bill specifies that nonindustrial private 

forests and agricultural lands are 

considered to be eligible lands for 

establishment payments and annual 

payments. Agricultural lands include 

cropland, grassland, pastureland, 

rangeland, hayland, and other land on 

which food, fiber, or other agricultural 

products are produced or capable of 

being produced. ‘‘Or capable of being 

produced’’ would include lands not in 

current agricultural production, so long 

as they are not native sod. However, 

these lands must meet the 

environmental review requirements 

and, as a condition of enrollment, must 

comply with conservation plans, forest 

stewardship plans, or equivalent plans. 

No change to the rule was made in 

response to this comment. 

Comments: There should be a ‘‘crop 

history requirement’’ for eligible land. 

Response: A crop history requirement 

is an eligibility requirement for CRP; the 

2008 Farm Bill included no such crop 

history requirement for BCAP. FSA will 

track information of the land use for 

BCAP contracts. 

Comments: Only marginal cropland 

should be considered as eligible land. 

Response: The 2008 Farm Bill 

included a definition of ‘‘eligible land’’ 

that includes agricultural land and 

nonindustrial private forest land. 

Targeting only marginal land is contrary 

to the purpose of BCAP, which includes 

promoting diversification of dedicated 

energy feedstock. One of the purposes of 

BCAP is to encourage the production of 

bioenergy crops on otherwise marginal 

land that is poorly suited to other 

agricultural uses. No change to the rule 

was made in response to this comment. 

Comments: Nonindustrial private 

forest land should not be eligible land 

due to concerns over converting native 

forests and savannahs to commercialproduction plantations. 

Response: BCAP will not incentivize 

the conversion of old growth, other 

natural forests, or savannahs to biomass 

plantings. The majority of old growth 

forest that exists in the United States is 

located on Federal land, managed 

predominantly as part of the National 

Forest System and by the Bureau of 

Land Management. The laws, 


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regulations, and procedures that govern 

the management of these lands preclude 

the liquidation of old growth as well as 

the establishment of non-native forests. 

While the same laws and other 

restrictions do not generally apply to 

privately held land, the BCAP 

regulation provides that provisions of 

the Healthy Forests Restoration Act (16 

U.S.C. 6512), must be followed on 

private land in order for material 

harvested from that land to qualify for 

a BCAP matching payment. Therefore, 

BCAP does not provide an incentive to 

harvest old growth forest for conversion 

to energy. Further, under the BCAP 

regulation, only woody biomass outside 

contract acreage that is removed as a 

preventative treatment to address fire 

danger, insect or disease outbreaks, or 

ecosystem health, and has no other 

higher-value purpose, is eligible for 

matching payments. In addition to legal 

restriction, analysis of forest product 

markets show that prices of saw logs 

and other timber is significantly higher 

than wood for energy, even with 

matching payments up to $45 per dry 

ton. Little economic reason exists to 

convert a forest producing hard or 

softwood timber to an energy plantation. 

This assessment by forestry experts 

agrees with the BCAP PEIS analysis that 

shows that land conversion driven by 

BCAP would happen primarily on 

marginal cropland and pastureland. 

Also, the 2008 Farm Bill does not 

authorize the conversion of savannahs 

to commercial production plantations 

for purposes of BCAP; native sod is 

explicitly excluded from eligibility for 

BCAP project areas. 

Comments: Land enrolled in CRP 

should be eligible to enroll in BCAP 

once the CRP contract has expired and 

the land meets all other eligible land 

requirements. 

Response: Under CRP, when a 

contract nears expiration, CCC notifies 

the CRP participant of the pending 

expiration and that the land may be 

eligible to be re-enrolled in CRP or 

enrolled under the Direct and CounterCyclical Program. CCC will add BCAP 

as a potential use for the land, too. No 

change was required to the rule to 

implement this comment. 

Comments: Abandoned and reclaimed 

mine land should be considered as 

eligible land for establishment payments 

and annual payments. 

Response: The 2008 Farm Bill does 

not exclude abandoned or reclaimed 

mine land from contract acreage under 

a project area, so it could be eligible 

land under this rule. However, the land 

must meet all the contractual 

obligations, including environmental 

screening and planning. Establishment 

payments cannot be used for the 

cleanup of contamination and related 

remediation that are not a part of the 

BCAP conservation plan, forest 

stewardship plan, or equivalent plan. 

No change to the rule was made in 

response to this comment. 

Comments: Clarify the eligibility of 

non-Federal lands including whether 

State and other local-government lands 

are eligible land. 

Response: The 2008 Farm Bill does 

not allow for Federal- or State-owned 

lands to be eligible land for contract 

acreage within project areas. Local 

governments are considered a subdivision of the State, and therefore local 

government-owned land is ineligible for 

enrollment as BCAP contract acreage. 

Duration of Contracts (§ 1450.205) 

Comment: BCAP contracts should be 

renewable. 

Response: The 2008 Farm Bill does 

not provide authority to renew contracts 

after 2012. No change to the rule was 

made in response to this comment. 

Comment: BCAP contracts should use 

a delayed effective date in order to 

accommodate the time it may take for 

eligible crops to become established. 

Response: Because BCAP is designed 

to promote the cultivation of 

unconventional biomass crops where a 

market to purchase those crops does not 

yet exist, or is at its earliest stages of 

development, providing a delay in 

BCAP contracts until the nonconventional crops become established 

would result in little incentive for 

landowners to switch from known, 

revenue-generating conventional crops; 

this lead time is also necessary so that 

the required base of non-conventional 

crops is established to coincide with the 

operations of biomass conversion 

facilities. For more than a quarter of a 

century, CCC has managed long-term 

contracts for CRP; the annual income of 

CRP contracts provides a distinct, but 

equitable incentive to conventional crop 

revenues so as to recognize an important 

value of land unrecognized by the 

conventional crop marketplace. By 

delaying the annual income of the BCAP 

contract, it is unlikely the nonconventional BCAP crop would be 

established. This comment was not 

adopted. 

Comments: Duration of contract 

should consider geographic and 

environmental factors. 

Response: The duration of contracts is 

limited by the 2008 Farm Bill to no 

more than 5 years for herbaceous crops 

and no more than 15 years for woody 

crops. No change to the rule was made 

in response to this comment. 

Comments: Non-woody perennial 

crops should have contract durations 

between 7 to 10 years. 

Response: The contract duration for 

non-woody perennial crops is specified 

as up to 5 years in the 2008 Farm Bill. 

No change to the rule was made in 

response to this comment. 

Obligations of Participant (§ 1450.206) 

Comments: Producers should not be 

required to implement a conservation 

plan, forest stewardship plan, or 

equivalent plan on all contract acreage 

regardless of the number of acres 

enrolled or the amount of eligible crops 

produced by the producer(s). 

Response: The 2008 Farm Bill 

requires that any eligible land within 

the project area that is enrolled under 

the contract must include a 

conservation plan, forest stewardship 

plan, or equivalent plan. We do not 

have discretion to remove this 

requirement. In addition, eligible land 

within a proposed project area will be 

included in the environmental 

screening and must comply with the 

prescribed environmental requirements. 

No change to the rule was made in 

response to this comment. 

Comments: While we generally 

support the requirements for producers 

to make information available to CCC or 

institutions of higher education 

concerning the production of eligible 

crops and the development of biomass 

conversion technology, we are 

concerned about the release of 

proprietary information. 

Response: The 2008 Farm Bill 

requires that BCAP contracts include 

terms that require participants to make 

available information to the Secretary, 

to institutions of higher education, or 

any other entity designated by the 

Secretary, such information as the 

Secretary considers to be appropriate to 

promote the production of eligible crops 

and the development of biomass 

conversion technology. CCC will 

comply with all applicable transparency 

and privacy laws, regulations, or 

Executive Orders, for example, the 

Freedom of Information Act. No change 

to the rule was made in response to this 

comment. 

Conservation Plan, Forest Stewardship 

Plan, or Equivalent Plan (§ 1450.207) 

Comments: There were many 

comments suggesting alternatives and 

additions to the requirements for 

conservation plans and forest 

stewardship plans. Commenters made a 

number of related recommendations 

including: 


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• Do not require anything beyond 

what may be required for an annual 

crop such as wheat or corn; 

• Following sustainable biomass 

establishment and harvesting guidelines 

including harvesting strategies that 

allow for the producer to determine the 

exact area for harvest each year as a part 

of the conservation plan, forest 

stewardship plan, or equivalent plan; 

• Expedite the approval of plans for 

the first fiscal year; 

• Make plan requirements voluntary; 

• Make plan requirements consistent; 

• Propose third-party verification, reestablishment of grasses or trees postharvest, harvest timing, residual height, 

crop diversity, greenhouse gas life-cycle 

assessments, standard soil erosion rates, 

and considerations for threatened and 

endangered species, pollinators, nesting 

birds, buffers, and pests; 

• Use the State of Minnesota 

standards, the Forest Stewardship 

Council standards, and standards sets 

by the respective State, and National 

standards; 

• Use the NRCS Soil Conditioning 

Index to evaluate the impacts to soil 

resources; and 

• Consider the costs of conservation 

plan, forest stewardship plan, or 

equivalent plans, specifically in relation 

to the size of the tract of land. 

Response: CCC will use technical 

assistance providers such as NRCS and 

State Foresters to provide assistance 

with conservation plan, forest 

stewardship plan, and equivalent plans. 

Non-government private providers of 

technical assistance may also be used. 

These technical assistance providers 

will use the most appropriate data and 

standards for harvesting to conduct the 

planning for contract acreage within the 

context of the applicable geography. 

Implementing conservation plans, 

forest stewardship plans, or equivalent 

plans for all land involved in BCAP is 

a critical factor in conserving natural 

resources, regardless of the size of 

particular tracts of land. 

The BCAP regulations provide general 

requirements, including the 

requirements for the plans. The required 

plans will be site specific plans and will 

vary based on the specific location and 

eligible crops. Specific standards 

suggested by the commenters may make 

sense in a specific location, but may not 

fit for another location. For example, 

requiring particular harvesting practices 

may not be suitable for all eligible land. 

Therefore, we will work with technical 

assistance providers to ensure that 

applicable BCAP practices are applied 

on a case-by-case basis for contract 

acreage in the project areas. The 

determination regarding harvesting will 

be executed in compliance with 

environmental review and planning. No 

change to the rule was made in response 

to this comment. 

Comments: There may be impacts to 

threatened and endangered species if 

potentially noxious and invasive species 

are considered as eligible crops. 

Response: No species that is noxious 

or invasive in that State will be 

considered as an eligible crop. No 

change to the rule was made in response 

to this comment. 

Comments: Do not waive the 

requirement for a conservation plan if 

the conservation district declines to 

review or approve a conservation plan. 

Response: CCC will not waive the 

requirement for a conservation plan, 

forest stewardship plan, or equivalent 

plan. However, in the case where the 

conservation district declines to review 

or approve a conservation plan, then 

CCC retains the authority to waive the 

requirement for conservation district 

review—this does not waive the 

requirement for the plan. If a 

conservation district declines to review 

a conservation plan, farmers and 

ranchers should not be harmed by 

precluding enrollment. No change to the 

rule was made in response to this 

comment. 

Comments: Do not use local soil and 

water conservation districts; such 

districts are not funded for work on 

BCAP. 

Response: FSA has a long and valued 

partnership with the conservation 

districts for implementation of CRP, and 

expects BCAP to be one of many 

continued partnership opportunities. No 

change to the rule was made in response 

to this comment. 

Comments: Consider the following to 

be ‘‘equivalent plans:’’ the American 

Tree Farm Program, the Sustainable 

Forestry Plan, plans created by foresters 

or third-party forester licensed by the 

State, and the State Best Management 

Practices Program. 

Response: CCC works with the U.S. 

Forest Service and State Foresters to 

ensure that equivalent plans meet the 

criteria outlined in this rule and with 

applicable State law. The determination 

of the applicability of certain plan types 

for BCAP will be made at a local level. 

No change to the rule was required in 

response to this comment. 

Eligible Practices (§ 1450.208) 

Comments: Provide examples of the 

eligible practices for annual crops, nonwoody perennial crops, and woody 

perennial crops. 

Response: Eligible practices will be 

developed in consultation with the U.S. 

Forest Service and the Natural 

Resources Conservation Service. Actual 

practice standards may vary by region 

due to climatic conditions, moisture, 

elevation, and other technical 

considerations. No change to the rule 

was made in response to this comment. 

For more information on appropriate 

practices for a particular crop in a 

particular area, please contact your FSA 

county office. 

Comments: Land rental payments, 

equipment purchases, general 

maintenance, chemical inputs, weed 

and pest control, and inter-planting 

costs should be considered reimbursable 

under eligible practices. 

Response: Rental payments and 

equipment will not be reimbursable. 

Some of the other items may be 

reimbursable, depending on the specific 

practice. CCC and FSA will draw on our 

long experience with establishing 

practices under CRP, the Emergency 

Conservation Program, and other 

programs to determine eligible costs and 

the reimbursement rate for these costs. 

Generally, the practice standards for 

those programs provide funding to 

establish a practice, which in some 

cases may include the suggested items. 

BCAP does not include funding for land 

rental payments as such, but the BCAP 

annual payments provide a similar 

support. Equipment purchases are not 

authorized by the 2008 Farm Bill. 

Generally, weed and pest control, 

chemical inputs, and inter-planting 

costs are authorized under the contract. 

In summary, many of the suggested 

items could be funded if appropriate as 

part of a particular establishment 

practice. No change to the rule was 

made in response to this comment. 

Comments: Conversion of existing 

covers including non-native vegetative 

cover to eligible crops should be 

considered eligible for enrollment. 

Response: Where suited for the area, 

this would be consistent with BCAP 

purposes. In general, that would be an 

acceptable practice so long as all other 

eligibility requirements are met. 

Comments: Algae production should 

specifically be included as a non-woody 

perennial eligible practice. 

Response: Because algae does not 

have to be established on an annual 

basis or shorter time period, CCC 

anticipates treating it as a perennial 

crop. However, because this is an 

emerging crop, CCC will make this 

determination based on project 

proposals and technical practices as 

they become available. No change to the 

rule was made in response to this 

comment. 


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Acceptability of Offers (§ 1450.210) 

Comments: CCC should use the 

environmental benefits index (EBI) tool 

under CRP to score BCAP contract offers 

and to favor marginally-productive land. 

Response: This is unworkable for 

BCAP. CRP enrolls land through two 

ways: a competitive or ‘‘general’’ sign-up 

and a non-competitive or ‘‘continuous’’ 

sign-up. BCAP is analogous to CRP 

continuous sign-up, where all eligible 

offers will accepted, rather than the 

competitive ‘‘general’’ sign-up. Under 

CRP general sign-up, offers for CRP are 

ranked according to an EBI. FSA 

collects data for a number of factors 

based on the relative environmental 

benefits for the land offered. EBI 

rankings are unique for each piece of 

ground offered into CRP. Each offer is 

assigned a point score based on its 

relative environmental factors and 

competes with all other offers. Offer 

acceptability is determined based on the 

ranking results. Under CRP continuous 

sign-up, FSA accepts all offers of certain 

high priority practices including grass 

waterways, riparian buffers, and filter 

strips. CCC will accept land to be 

enrolled under BCAP under a similar 

‘‘continuous’’ approach that provides 

flexibility for farmers and ranchers and 

biomass conversion facilities to manage 

their respective operations. No change 

to the rule was made in response to this 

comment. 

BCAP Contract (§ 1450.211) 

Comments: Producers should retain 

the right to determine what section of 

land to harvest each year. 

Response: Contract participants will 

work closely with technical service 

providers to develop a conservation 

plan, forest stewardship plan, or 

equivalent plan that will include 

harvesting provisions. Producers will 

have the right to determine which 

section of land to harvest, as long as that 

is compliant with the plan. No change 

to the rule was made in response to this 

comment. 

Comments: Producers should be 

afforded maximum establishment 

payments, but not be required to harvest 

all eligible crops for BCAP purposes. 

Clarify the annual payment reductions 

when eligible crops are not harvested or 

not harvested for BCAP purposes within 

the contract period. 

Response: For BCAP, the 2008 Farm 

Bill sets the maximum establishment 

payment rate at 75 percent of the costs 

of establishing an eligible perennial 

crop. With respect to annual payment 

reductions, one of BCAP’s purposes is to 

support the production of eligible crops 

for conversion to energy. However, the 

2008 Farm Bill also provides for 

instances where an eligible crop may be 

used for other purposes. As specified in 

the rule, annual payments will be 

reduced by a percentage of the sale price 

and matching payments received if an 

eligible crop is converted to heat, 

power, biobased products, or advanced 

biofuels. Payments will be reduced on a 

dollar-for-dollar basis if an eligible crop 

is used for a purpose other than 

conversion to heat, power, biobased 

products. No change to the rule was 

made in response to this comment. 

Comments: The use of eligible crops 

should be contractually restricted to 

producing bioenergy. 

Response: BCAP was designed to 

provide incentives to farmers and forest 

landowners to establish a nontraditional biomass crop base that can 

be used for heat, power, biobased 

products, and biofuels. No change was 

made to the rule in response to this 

comment. 

Comment: The BCAP contract should 

include a mutually-agreeable 

withdrawal clause that allows producers 

to terminate their BCAP contract early. 

Response: The BCAP contract will 

include a provision for contract 

termination before the scheduled 

expiration of the contract if the 

participant(s) under the BCAP contract 

fully refunds CCC for all payments plus 

interest from date of disbursement and 

liquidated damages equal to 25 percent 

of one year’s annual payment to reflect 

the administrative costs associated with 

a termination and to reflect that the 

termination may, even with a full 

refund, undermine the accomplishment 

of the goals of BCAP in a way that may 

otherwise be difficult to convert to 

dollars and cents. This is similar to 

CCC’s CRP contract. No change to the 

rule was made in response to this 

comment, but the provision for contract 

termination will be in the contract. 

Establishment Payments (§ 1450.212) 

Comment: The subsidy process for 

establishment should be expedited since 

it can take up to 3 years to achieve a 

marketable feedstock. 

Response: CCC will expedite 

establishment payments for contract 

acreage, following compliance with 

establishment of BCAP practice 

standards and related conservation 

plans, forest stewardship plans, or 

equivalent plans. 

Comments: Previously established 

crops and annual crops should be 

eligible for establishment payments. 

Response: The 2008 Farm Bill does 

not provide for making establishment 

payments for pre-existing eligible crops 

or for annual crops. Accordingly, this 

comment was not adopted. 

Comment: Clarify whether animal 

waste, food waste, and yard waste will 

be eligible for establishment payments. 

Response: Animal waste, food waste, 

and yard waste are all considered 

renewable biomass and a crop of any of 

these waste materials would by 

definition be eligible for establishment 

payments. At this time, there are no 

technical standards for establishing 

these ‘‘crops’’ so it is not known what if 

any establishment costs would be 

eligible for an establishment payment. 

Levels and Rates for Establishment 

Payments (§ 1450.213) 

Comments: Under what 

circumstances would a producer receive 

less than 75 percent of the 

establishment costs? 

Response: Establishment payments 

may be less than 75 percent of the 

producer’s costs when, for example, an 

unapproved component was used or the 

producer’s actual costs were greater 

than average costs. CCC will establish 

market-based rates for standard 

components of practices such as land 

preparation, seed, and chemicals. No 

change to the rule was made in response 

to this comment. 

Comments: CCC should provide 

higher establishment payments for 

native grasses and forbs. 

Response: Establishment payment is 

limited to 75 percent by the 2008 Farm 

Bill. There may be annual payment 

incentives for certain practices. 

Comments: There should be per acre 

limitations for establishment payments. 

Response: CCC intends to adopt its 

long-standing practice that has been 

used for CRP to apply market-based 

limits to individual practices, seed 

varieties, and other components. This 

approach ensures that establishment 

costs meet the needs of BCAP and are 

not excessive. No change to the rule was 

made in response to this comment, but 

BCAP will implement such limitations. 

Annual Payments (§ 1450.214) 

Comments: Annual payments based 

on soil rental rates will create 

competition between BCAP and CRP. 

Response: CRP and BCAP are more 

directly competing with other land uses 

than with each other. BCAP and CRP 

must compete in the open market with 

other land uses including production of 

food and feed. The CRP’s soil rental 

rates are intended to be market-based 

rates for a particular area of land that is 

offered. CRP and BCAP both provide for 

making incentive payments to meet 

targeted goals. No change to the rule 

was made in response to this comment. 


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Comments: Annual payments based 

on CRP’s soil rental rates, as proposed, 

are insufficient. 

Response: Where appropriate, CCC 

will authorize the use of incentive 

payments to offset the uncertainty 

associated with adding production of 

renewable biomass to a farming 

operation. CCC’s intent is to authorize 

incentive payments only as proposed in 

a particular project area and only after 

the project area proposal includes 

sufficient analysis to justify authorizing 

the additional expense. No change to 

the rule was made in response to this 

comment, but we believe that the rule 

already addresses this comment. 

Comments: Annual payments should 

be based on the remaining costs of 

establishment and maintenance 

amortized over the life of the contract. 

Response: Not all eligible crops for 

annual payments will also be eligible for 

establishment payments. Only perennial 

crops can receive establishment 

payments, and existing ‘‘early adopter’’ 

biomass crops cannot receive 

establishment payments. As a result, 

implementing payments with an 

amortized methodology would not meet 

BCAP purposes, unfairly advantage 

certain crops, and add considerable 

administrative burden. Accordingly, 

this suggestion was not adopted. 

Comments: There should be a uniform 

annual payment rate across the Nation. 

Response: This would only work well 

if in all markets the national rate was 

similar to the otherwise applicable 

market rate. Where there are lands with 

market rates above the national rate, 

BCAP could not compete with other 

purposes and there would be little 

renewable biomass crops produced. 

Accordingly, this comment was not 

adopted. 

Comments: Annual payments should 

end after the first harvest. 

Response: Contract termination after 

first harvest would not provide 

sufficient market certainty or 

incentivize long-term energy feedstock 

supply in a nascent bioenergy market. 

Therefore, this comment was not 

adopted. This alternative is, however, 

analyzed in the cost benefit analysis for 

this final rule. Also, some crops will 

take the entire period of the contract to 

be ready for a single harvest, so in those 

cases, the annual payments effectively 

end after the first harvest. 

Comments: Annual payments should 

be dependent on geographic and 

environmental factors. 

Response: There may be such a 

relationship between the payments and 

other factors to the extent that other 

factors affect local market conditions 

given that the soil rental rates may be 

based on local market conditions. No 

change to the rule was made in response 

to this comment. 

Comments: Annual payments should 

be tiered based on the type and variety 

of crops established. 

Response: BCAP will contribute to the 

local crop mix by providing 

opportunities for a nonconventional 

biomass crop base along with existing 

conventional crops. Also, using the CRP 

soil rental rates will ensure marketbased rental rates. However, a project 

sponsor may propose using incentive 

payments with appropriate justification. 

No change to the rule was made in 

response to this comment. 

Comments: Annual payments for 

nonindustrial private forest land should 

be equal to the tax value of the land. 

Response: The tax value could 

approximate the purchase value (or 

significant percentage) of the land, 

which would be inconsistent with an 

annual payment based on the annual 

rental value of the land. Accordingly, 

this comment was not adopted. 

Comments: Offer incentives on annual 

payments to encourage certain crops, 

management activities, and locations. 

Offer incentives for the level of 

conservation practices established, 

crops that would receive higher carbon 

credits, mixtures of native perennials, 

leaving environmentally sensitive areas 

unharvested, and implementing 

practices that improve forest ecosystem 

health. 

Response: CCC will authorize an 

incentive for annual payments for 

certain contract acreage when 

appropriate and justified to meet 

enrollment and feedstock production 

costs on a project area basis. No change 

to the rule was made in response to this 

comment, but we believe that the final 

rule does address this comment. 

Comments: Reduce annual payments 

if any use occurs on contract acreage 

during the primary nesting season. 

Response: All BCAP participants will 

be required to adopt a conservation 

plan, forest stewardship plan, or 

equivalent plan as a condition of 

enrollment. Use restrictions during 

primary nesting season may be 

addressed in the plan, and failure to 

comply with such plan will result in a 

contract violation, which will reduce 

annual payments. No change to the rule 

was made in response to this comment. 

Comments: Do not reduce annual 

payments beyond a certain level 

(suggestions ranged from 20 percent to 

100 percent). 

Response: CCC has further clarified 

the terms of reduction in this final rule. 

Reductions will be made when biomass 

is harvested or collected from contract 

acreage. Biomass that is converted to 

heat, power, biobased products, or 

advanced biofuels at a biomass 

conversion facility will receive a 

payment reduction of 10 to 25 percent. 

If the biomass is used for another 

purpose the payment reduction will be 

based on a dollar-for-dollar reduction 

from the annual payment. In no case, 

except contract violation, in which case 

liquidated damages may apply, will the 

reduction be greater than dollar for 

dollar. 

Comment: Commenters suggested that 

annual payments should not be reduced 

in the cases when: (1) Eligible crops are 

delivered to an intermediate biomass 

conversion facility that delivers the 

processed biomass to a project area 

biomass conversion facility or (2) 

eligible crops are harvested for seeds. 

Response: Reduction of annual 

payments will occur when renewable 

biomass is harvested and collected from 

contract acreage and then sold and 

delivered to any biomass conversion 

facility. Annual payments will be 

reduced by a percentage of the total of 

the sale price and matching payments 

based on the use of the eligible crop, 

including harvest for seed. It is 

permissible, and would not be a 

violation of the BCAP contract, to 

harvest eligible crops for uses other than 

conversion to heat, power, advanced 

biofuels, or biobased products; however, 

producers who do so will forfeit 

payments as a result. This provision 

will adequately address the issue raised 

in the comment. 

Substantive Changes and Corrections in 

This Final Rule as Versus the Proposed 

Rule 

This section lists the substantive 

changes made in this final rule to the 

regulatory language in response to 

comments on the proposed rule. The list 

also includes technical corrections that 

will have little or no impact on program 

implementation. 

Throughout all three subparts, this 

rule clarifies the requirement for 

conservation plans to include forest 

stewardship plans or equivalent plans, 

as specified in the 2008 Farm Bill. 

Substantive changes and technical 

corrections in subpart A for common 

provisions include: 

• Adding a definition for ‘‘biofuel’’ to 

clarify the distinction between 

‘‘biofuels’’ and ‘‘advanced biofuels.’’ The 

distinction is that biofuels include corn 

ethanol. 

• Correcting the definition of 

‘‘biomass conversion facility’’ by 

removing ‘‘eligible material’’ and 

inserting ‘‘renewable biomass.’’ This 

clarifies that qualified biomass 


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Federal Register / Vol. 75, No. 207 / Wednesday, October 27, 2010 / Rules and Regulations 66231 

conversion facilities may accept for 

processing renewable biomass that is 

not eligible material for BCAP matching 

payments. 

• Amending the definition of 

‘‘conservation plan’’ to remove general 

conservation provisions that are 

relevant to conservation plans 

developed for other FSA and CCC 

programs such as CRP and to add 

instead specific references to BCAP 

eligible crops and eligible material. 

• Adding a definition of ‘‘legal entity’’ 

that references the definition in 7 CFR 

part 1400 used for other FSA and CCC 

programs. 

• Correcting the date applicable to the 

definition of ‘‘native sod’’ from the date 

of publication of the final rule in the 

Federal Register to the date of 

enactment of the 2008 Farm Bill, which 

was June 18, 2008. 

• Correcting the definition of 

‘‘nonindustrial private forest land,’’ by 

replacing a reference to an applicable 

US Forest Service regulation that 

defines that term to the authorizing 

legislation for that definition, which is 

the Cooperative Forestry Assistance Act 

of 1978 (16 U.S.C. 2103(a), as amended). 

• Adding a definition of ‘‘person’’ that 

references the definition in 7 CFR part 

1400 used for other FSA and CCC 

programs. 

• Removing the definition of ‘‘relatedparty transaction’’ because this rule also 

removes all the provisions using that 

term. 

• Clarifying the definition of 

‘‘renewable biomass’’ by removing the 

phrase ‘‘that would not otherwise be 

used for higher-value products’’ from the 

parenthetical remark describing 

vegetative waste as ‘‘(including wood 

waste and wood residues that would not 

otherwise be used for higher-value 

products).’’ The higher-value product 

limitation on matching payments 

applies to all woody biomass, not just 

waste and residues. In addition, it is a 

regulatory requirement and was 

incorrectly included in the definition. 

Also, this rule clarifies that payment is 

not authorized for otherwise eligible 

material that must be separated from 

higher-value products after delivery to a 

biomass conversion facility. 

• Correcting the definition of sociallydisadvantaged farmer or rancher to 

conform to section 2501(e) of the Food, 

Agriculture, Conservation, and Trade 

Act of 1990 (7 U.S.C. 2279(e)). 

• Removing the definition of ‘‘United 

States’’ because no such definition is 

required in the BCAP regulations, 

• In § 1450.3, ‘‘General,’’ in the 

paragraph on the objectives of BCAP, 

adding a reference to the establishment 

of crops for conversion to biobased 

products. 

Substantive changes in subpart B for 

matching payments include: 

• Adding a new § 1451.100 to provide 

a general description of subpart B. 

• Amending § 1450.101(a)(2)(ii) to 

clarify that a qualified biomass 

conversion facility must retain all 

records for a period of 3 years after 

delivery of the eligible material (rather 

than 3 years after the application). 

• Amending § 1450.101(a)(2)(vii) to 

remove provisions related to vegetative 

waste and historical baselines, and to 

add a new provision requiring that the 

biomass conversion facility pay fair 

market value for the eligible material 

regardless of whether the seller has 

applied for or will receive a BCAP 

matching payment. 

• Adding a new § 1450.101(a)(2)(viii) 

to require a certification that eligible 

material will be converted into heat, 

power, biobased products, or advanced 

biofuels. 

• Removing the reference to ‘‘relatedparty transaction’’ in § 1450.102. 

• Revising § 1450.103, ‘‘Eligible 

Material,’’ to remove references to black 

liquor, and to clarify that the material 

owner must have harvested the material 

directly from the land in accordance 

with a conservation plan, forest 

stewardship plan, or other equivalent 

plan. 

• Revising § 1450.103, ‘‘Eligible 

Material,’’ to remove the provisions 

allowing partial payment for comingled 

materials on non-contract land. Payment 

is not authorized for any otherwise 

eligible material that must be separated 

from higher-value product after delivery 

to a biomass conversion facility. 

• Revising § 1450.103, ‘‘Eligible 

Material,’’ to clarify that in order to 

qualify for a matching payment, woody 

biomass harvested or collected from 

non-Federal land outside of BCAP 

contract acreage (acreage under an 

establishment payments and annual 

payments contract) must be by-products 

of preventative treatments, must not 

have a higher value use, and must meet 

the other requirements for renewable 

biomass obtained from Federal land. 

• Amending § 1450.104 to require 

that letters of intent be binding. 

• Revising § 1450.106, ‘‘Payments,’’ to 

provide that the 2-year payment period 

is for BCAP as implemented through the 

regulation and to address the BCAP 

NOFA, and that payments will be paid 

at a rate of $1 for each $1 per dry ton 

provided by a qualified biomass 

conversion facility for the market-based 

sale of eligible material in an amount up 

to $45 per dry ton. The ‘‘fair market 

value’’ is a new requirement that 

biomass conversion facilities not have a 

different payment rate for BCAP 

participants than for other biomass 

sellers. Options discussed in the 

proposed rule for tiered payment rates 

and for biomass production above a 

historical baseline are not included in 

this final rule. 

Substantive changes in subpart C for 

establishment payments and annual 

payments include: 

• Amending § 1450.201 to clarify that 

a project area proposal must include a 

description of the sources of the 

renewable biomass within the project 

area. Adding a provision to § 1450.204 

that eligible land must be physically 

and legally capable of producing an 

eligible crop to be considered eligible 

land. 

• Removing specific references to 

types of agricultural land in § 1450.204 

because the list of the types of land 

included in the term ‘‘agricultural land’’ 

is specified in the definitions section. 

• Removing a specific date that 

eligible land must not be native sod, 

because that date is provided in the 

definitions section. 

• In § 1450.212, removing a reference 

to specific reasons that establishment 

payments may be authorized for 

practices that have previously been paid 

for, to give CCC more flexibility for 

funding replacement or restoration 

practices. 

• In § 1450.214, adding a reference to 

incentive payments, to give CCC 

flexibility to implement such payments 

as needed for specific priority biomass 

crops. 

• In § 1450.214, clarifying the amount 

of reduction in payment for delivery of 

eligible crops to a biomass conversion 

facility and for other uses. 

Executive Order 12866 

This rule has been determined to be 

economically significant and was 

reviewed by the Office of Management 

and Budget (OMB) under Executive 

Order 12866. The Cost Benefit Analysis 

is summarized below and is available 

from the contact information listed 

above. 

Cost Benefit Analysis Summary 

BCAP is intended to assist 

agricultural and forest land owners and 

operators with the establishment and 

production of eligible crops for 

conversion to bioenergy in selected 

project areas and with the collection, 

harvest, storage, and transportation of 

eligible material for use in a biomass 

conversion facility. 

BCAP is authorized through fiscal 

year (FY) 2012. The limited time 

remaining in the 2008 Farm Bill cycle, 


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1All NPV calculations assume a 3% discount 

rate. 

the specific provisions in the 2008 Farm 

Bill on materials and crops eligible to 

receive payments, and the short time 

window for developing and submitting 

project proposals associated with 

establishment and annual payments 

essentially limits the impact of BCAP to 

that of a transfer payment to biomass 

producers who deliver their materials 

and crops to existing biomass 

conversion facilities. Establishment 

payments and annual payments are 

provided for eligible crops on eligible 

land within project areas that satisfy 

selection criteria. Based on USDA and 

Department of Energy data on existing 

facilities and facilities nearing 

operational status, we assume that 32 

project areas will be approved. All of 

these project areas are assumed to be 

associated with acreage that receives 

annual payments and most of these 

acres—those growing perennial energy 

crops—will also receive support to 

defray establishment costs. A small 

amount of technical assistance will be 

provided to assist producers in 

establishing biomass crops. Matching 

payments are provided to assist 

producers with the collection, harvest, 

storage, and transportation costs of 

biomass feedstock delivered to 

qualifying biomass conversion facilities, 

which may or may not be associated 

with project areas. Eligible material that 

qualifies for payment is specified in the 

rule as material that is collected directly 

from the land, is harvested and 

transported solely for bioenergy and 

biobased products purposes, and would 

not otherwise be used to produce 

higher-value products. Further, 

qualified biomass conversion facilities 

must pay fair market value for eligible 

material. 

BCAP will help to sustain and 

accelerate the development of the 

renewable energy sector. In conjunction 

with other Federal and State 

government policies, BCAP will 

facilitate the transition to renewable 

energy by helping to produce and 

supply feedstock for the conversion to 

bioenergy and biobased products. In the 

short term, establishment, annual, and 

matching payments can contribute to 

the financial viability of BCFs, 

providing them greater opportunity to 

innovate and mature sufficiently so that 

they might compete with fossil fuels. 

Annual and total costs for BCAP are 

presented in Table 1. Total outlays are 

$461 million in constant (2011) dollars 

and $442 million in Net Present Value 

(NPV) terms.1 Because BCAP benefits 

are essentially transfer payments to 

BCAP producers and indirectly to BCFs, 

the costs to the government (outlays) 

equal the benefits to those producers 

and BCFs. 

TABLE 1—BCAP COSTS AND BENEFITS BY YEAR

[2011 $ millions] 

Fiscal Year Establishment 

Cost Share Annual Payments Matching Payments 

Technical 

Assistance Annual Total 

2011 ....................................................... 61 4 132 3 199 

2012 ....................................................... 61 6 132 3 201 

2013 ....................................................... .............................. 6 – .............................. 6 

2014 ....................................................... .............................. 5 .............................. .............................. 5 

2015 ....................................................... .............................. 5 .............................. .............................. 5 

2016 ....................................................... .............................. 6 .............................. .............................. 6 

2017 ....................................................... .............................. 4 .............................. .............................. 4 

2018 ....................................................... .............................. 4 .............................. .............................. 4 

2019 ....................................................... .............................. 5 .............................. .............................. 5 

2020 ....................................................... .............................. 3 .............................. .............................. 3 

2021 ....................................................... .............................. 3 .............................. .............................. 3 

2022 ....................................................... .............................. 5 .............................. .............................. 5 

2023 ....................................................... .............................. 4 .............................. .............................. 4 

2024 ....................................................... .............................. 4 .............................. .............................. 4 

2025 ....................................................... .............................. 5 .............................. .............................. 5 

2026 ....................................................... .............................. 3 .............................. .............................. 3 

Totals .............................................. 122 71 264 5 461 

Note: Due to rounding, the sum of reported figures may not equal totals. 

Regulatory Flexibility Act 

In accordance with the Regulatory 

Flexibility Act, 5 U.S.C. 601, CCC has 

determined that there will not be a 

significant economic impact on a 

substantial number of small entities. 

Entities affected by this rule are 

producers of eligible crops, eligible 

biomass material owners, and biomass 

conversion facilities. The small business 

size standards for these types of entities 

are no more than: 

• $750,000 per year gross revenue for 

crop production (producers of eligible 

crops—NIACS 111); 

• $7 million per year gross revenue 

for post harvest crop activities (eligible 

material owners—NIACS 115114); and 

• 4 million megawatt hours per year 

for other electric power generation 

(biomass conversion facilities—NIACS 

221119). 

Given these size standards, it is 

reasonable to assume that many of 

businesses involved in BCAP will be 

small businesses. 

We expect that approximately 5,000 

producers of eligible crops and 32 

biomass conversion facilities may 

receive establishment payments and 

annual payments and approximately 

975 eligible material owners (that are 

not affiliated with a biomass conversion 

facility) may deliver biomass that 

qualifies for a matching payment and 87 

biomass conversion facilities may be 

affected (which includes the 32, above) 

may receive biomass for which a 

matching payment was made. However, 

since the final rule requires that biomass 

conversion facilities pay producers for 

deliveries of eligible material based on 

fair market value, producers of eligible 

crops and materials and eligible biomass 

material owners are not expected to be 

significantly impacted. And given the 

scale of biomass conversion facility 


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Federal Register / Vol. 75, No. 207 / Wednesday, October 27, 2010 / Rules and Regulations 66233 

output, as well as the limited duration 

of BCAP, biomass conversion facilities 

are also not expected to be significantly 

impacted by BCAP. 

Environmental Review 

FSA prepared a Final Programmatic 

Environmental Impact Statement (PEIS) 

for BCAP and the NOFA was published 

in the Federal Register on June 25, 2010 

(75 FR 36386). The Record of Decision 

(ROD) regarding FSA implementation of 

BCAP according to the provisions of the 

2008 Farm Bill is being published in 

today’s Federal Register. The BCAP 

PEIS is being completed in accordance 

with the National Environmental Policy 

Act (NEPA, 42 U.S.C. 4321–4347) and 

FSA regulations (7 CFR part 799). The 

decision record summarizes the reasons 

for FSA selecting the proposed action 

alternatives based on the program’s 

expected environmental and 

socioeconomic impacts and benefits as 

documented in the PEIS, all of which 

were considered in the decision. 

Executive Order 12372 

This program is not subject to 

Executive Order 12372, which requires 

consultation with State and local 

officials. See the notice related to 7 CFR 

part 3015, subpart V, published in the 

Federal Register on June 24, 1983 (48 

FR 29115). 

Executive Order 12988 

This final rule has been reviewed 

under Executive Order 12988, Civil 

Justice Reform. This final rule is not 

retroactive and it does not preempt State 

or local laws, regulations, or policies 

unless they present an irreconcilable 

conflict with this rule. Before any 

judicial action may be brought regarding 

the provisions of this rule the 

administrative appeal provisions of 7 

CFR parts 11 and 780 must be 

exhausted. 

Executive Order 13132 

The policies contained in this rule do 

not have any substantial direct effect on 

States, on the relationship between the 

Federal government and the States, or 

on the distribution of power and 

responsibilities among the various 

levels of government. Nor does this rule 

impose substantial direct compliance 

costs on State and local governments. 

Therefore, consultation with the States 

is not required. 

Executive Order 13175 

The policies contained in this rule do 

not have Tribal implications that 

preempt Tribal law. 

FSA conducted two formal 

consultations with Tribal governments 

on BCAP prior to the publication of this 

final rule. Both of the Tribal 

consultations were conducted through 

teleconferences. All Federally 

recognized Tribes were invited to the 

first consultation, which was held on 

July 21, 2010. A transcript of the 

teleconference call is available upon 

request (see FOR FURTHER INFORMATION

CONTACT above or contact Ben Horter, 

USDA FSA, Federal Preservation 

Officer, (202) 690–1164). The Forest 

County Potawatomi Community 

requested a separate government-togovernment consultation on BCAP, 

which was held on July 22, 2010. Each 

of the Tribal consultations was led by 

the FSA Deputy Administrator for Farm 

Programs with representation from the 

FSA Administrator’s office as well as 

the USDA Office of Tribal Relations. 

During the Tribal consultations, 

Tribes commented on aspects of BCAP 

that they support and other aspects that 

they oppose. The full discussion of the 

issues presented during the Tribal 

consultations and the FSA responses are 

included above as the issues were also 

raised by other commenters and each of 

the Tribes had submitted in written 

comments including the same issues 

during the comment period for the 

proposed rule. 

Positions and issues presented during 

the Tribal consultations included: 

• Support for the establishment 

payment and annual payment 

provisions of the proposed rule. 

• Support for the use of soil rental 

rates similar to those used under CRP 

for determining annual payments. 

• Support for the proposed rule and 

the definition of eligible material owner. 

• Opposition to the baseline concept 

in the proposed rule matching payment 

options. 

• Concern about and request for 

clarification on the restriction on 

related-party transactions. 

• Suggestion that biomass conversion 

facilities producing wood chips and 

wood pellets should be eligible to 

become a qualified biomass conversion 

facility for converting renewable 

biomass to advanced biofuels. 

• Request for confirmation that a 

biomass conversion facility may be an 

eligible material owner. 

• Request for confirmation that only 

wood waste and wood residues could 

not be used for higher-value products. 

• Opposition to the matching 

payment options that favored advanced 

biofuels over heat, power, and biobased 

products. 

For the full discussion of these issues, 

see the comments and responses 

sections above for §§ 1450.101, 

1450.102, 1450.103, 1450.106, 1450.200 

and 1450.214. 

Unfunded Mandates 

Title II of the Unfunded Mandate 

Reform Act of 1995 (UMRA) (Pub. L. 

104–4) establishes requirements for 

Federal agencies to assess the effects of 

their regulatory actions that impose 

‘‘Federal Mandates’’ that may result in 

expenditures to State, local, or Tribal 

governments, in the aggregate, or the 

private sector, of $100 million or more 

in any one year. This rule contains no 

Federal mandates as defined by Title II 

of UMRA for State, local, or Tribal 

governments or for the private sector. 

Therefore, this rule is not subject to the 

requirements of sections 202 and 205 of 

UMRA. 

Small Business Regulatory Enforcement 

Fairness Act of 1996 

This rule has been determined to be 

Major under the Small Business 

Regulatory Enforcement Fairness Act of 

1996 (Pub. L. 104–121) (SBREFA). 

SBREFA requires that an agency delay 

the effective date of a major rule for 60 

days from the date of publication to 

allow for Congressional review. CCC 

finds that it is contrary to the public 

interest to delay the effective date of this 

final rule pending a 60-day 

Congressional review period. Because 

the program is tied to the agricultural 

production cycle, a 60-day delay risks 

deferring the establishment of biomass 

crops by an additional crop year, 

significantly diminishing the prospects 

of the public to obtain both critical 

information for the reauthorization of 

this program as well as physical 

feedstocks for meeting national energy 

goals. 

The purpose of BCAP is to begin the 

cultivation of unconventional, non-food 

non-feed biomass crops for energy. The 

planting season for many promising 

herbaceous biomass feedstock crops, 

including switchgrass and miscanthus, 

begins in the early spring. Most woody 

biomass crops, such as hybrid poplar 

and willow, are established in the fall. 

Because of the new and voluntary 

nature of BCAP, producers must know 

well in advance the details of the final 

BCAP regulation in order to evaluate the 

risk of participating in a BCAP project 

area, compared with the revenue 

security of maintaining conventional 

practices. Allowing the rule to become 

effective immediately provides the 

opportunity for FSA to immediately 

evaluate proposals submitted by the 

public and for project sponsors to 

initiate environmental assessments that 

may take from 3 to 6 months to 

complete. If this is the case, project 


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areas may be approved with sufficient 

time for producers to establish biomass 

crops for the upcoming growing season. 

Additionally, with the enactment of 

the updated Renewable Fuel Standard 

Program in 2008, the affordable 

production of next-generation advance 

biofuels has not yet kept pace with the 

revised Federal targets. The success of 

these next-generation fuels requires a 

sufficient base of next-generation 

crops—crops that typically requires 

several years to become established. 

Should the BCAP rule not take effect in 

time for the 2011 crop year, insufficient 

information will exist for Congress to 

evaluate this program during its 

reauthorization in 2012, further 

delaying any contributions BCAP can 

make to national Renewable Fuel 

Standard Program targets. 

Federal Assistance Programs 

The title and number of the Federal 

assistance program in the Catalog of 

Federal Domestic Assistance to which 

this proposed rule would apply is 

10.087—Biomass Crop Assistance 

Program. 

Paperwork Reduction Act 

In general, FSA will use information 

submitted for BCAP to determine 

program eligibility, qualifications for 

payments, and calculate the amount of 

payments. For the matching payments, 

applicants will request to become a 

qualified biomass conversion facility, 

applicants will register as an eligible 

material owner and then, after delivery 

of eligible material, provide actual 

delivery information to request 

matching payments for the collection, 

harvest, storage, and transportation of 

eligible material for use in a biomass 

conversion facility. For the 

administration of project areas, FSA will 

use proposal information from project 

sponsors to review project area criteria 

for the selection of BCAP project areas. 

After the selection of project areas, FSA 

will use information submitted by 

producers to determine eligibility, 

award contracts for establishment and 

annual production payments, and 

determine the need for an amount of the 

payments. Furnishing the data is 

voluntary; however, the failure to 

provide data could result in program 

benefits being withheld or denied. 

In accordance with the Paperwork 

Reduction Act of 1995, FSA requested 

comments from all interested 

individuals and organizations on a 

revision of new information collection 

activities associated with BCAP. Several 

comments included issues concerning 

information collection. Detailed 

discussion of all comments and 

responses are provided earlier in this 

document. Comments specific to the 

information collection requirements 

associated with this rule are highlighted 

here, and all of the comments and 

responses related to information 

collection are included in the full 

information collection request 

submitted for OMB approval. 

One comment (see § 1450.201 

comments and responses above) 

suggested that general information 

rather than producer specific 

information should be required as part 

of the information collected for project 

area proposals. FSA had intended to 

collect general information in the 

project area proposal under the 

proposed rule, but clarified the language 

in this rule. 

One comment (see § 1450.100 

comments and responses above) was 

concerned that FSA should collect 

information concerning the point-oforigin of eligible materials while 

minimizing the administrative burden 

of participating in the program. FSA 

modified the forms (BCAP–10A and 

BCAP–10B) to record farm and tract 

data for all land producing eligible 

materials. 

One comment (see § 1450.201 

comments and responses above) 

suggested that FSA provide a template 

project area proposal that outlines an 

acceptable proposal. Project area 

proposals will inherently be unique 

depending on what the project sponsor 

chooses to propose. It would be 

administratively infeasible to provide a 

template that applies to all potential 

issues and variability across the 

country. 

BCAP will provide financial 

assistance for collection, harvest, 

storage, and transportation of eligible 

material nationwide. BCAP will provide 

financial assistance in the form of 

establishment payments for perennial 

crops and annual rental payments for 

perennial and annual crops in approved 

BCAP project areas. 

Copies of all forms, regulations, and 

instructions referenced in this rule may 

be obtained from FSA. Data furnished 

by the applicants will be used to 

determine eligibility for program 

benefits. Furnishing the data is 

voluntary; however, the failure to 

provide data could result in program 

benefits being withheld or denied. 

In addition to requesting comments 

on the information collection included 

in the proposed rule, FSA also had a 60- 

day comment period for the BCAP 

NOFA that was published in the 

Federal Register on June 11, 2009 (74 

FR 27767–27772) to solicit public for 

the information collection request for 

the matching payment funds available 

for the collection, harvest, storage, and 

transportation of eligible material. 

The information collection required 

by this rule has been approved by OMB 

under the Paperwork Reduction Act of 

1995. The approved burden hours will 

be incorporated into the existing 

approval under OMB control number 

0560–0082, which includes much of the 

same information for other conservation 

programs. 

E-Government Act Compliance 

CCC is committed to complying with 

the E-Government Act, to promote the 

use of the Internet and other 

information technologies to provide 

increased opportunities for citizen 

access to Government information and 

services, and for other purposes. 

List of Subjects in 7 CFR Part 1450 

Administrative practice and 

procedure, Agriculture, Energy, 

Environmental protection, Grant 

programs—agriculture, Natural 

resources, Reporting and recordkeeping 

requirements, Technical assistance. 

■ For the reasons discussed in the 

preamble, the Commodity Credit 

Corporation (USDA) adds 7 CFR part 

1450 to read as follows: 

PART 1450—BIOMASS CROP 

ASSISTANCE PROGRAM (BCAP) 

Subpart A—Common Provisions 

Sec. 

1450.1 Administration. 

1450.2 Definitions. 

1450.3 General. 

1450.4 Violations. 

1450.5 Performance based on advice or 

action of USDA. 

1450.6 Access to land. 

1450.7 Division of payments and 

provisions about tenants and 

sharecroppers. 

1450.8 Payments not subject to claims. 

1450.9 Assignments. 

1450.10 Appeals. 

1450.11 Scheme or device. 

1450.12 Filing of false claims. 

1450.13 Miscellaneous. 

Subpart B—Matching Payments 

1450.100 General. 

1450.101 Qualified biomass conversion 

facility. 

1450.102 Eligible material owner. 

1450.103 Eligible material. 

1450.104 Signup. 

1450.105 Obligations of participant. 

1450.106 Payments. 

Subpart C—Establishment Payments and 

Annual Payments 

1450.200 General. 

1450.201 Project area proposal submission 

requirements. 

1450.202 Project area selection criteria. 


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1450.203 Eligible persons and legal 

entities. 

1450.204 Eligible land. 

1450.205 Duration of contracts. 

1450.206 Obligations of participant. 

1450.207 Conservation plan, forest 

stewardship plan, or equivalent plan. 

1450.208 Eligible practices. 

1450.209 Signup. 

1450.210 Acceptability of offers. 

1450.211 BCAP contract. 

1450.212 Establishment payments. 

1450.213 Levels and rates for 

establishment payments. 

1450.214 Annual payments. 

1450.215 Transfer of land. 

Authority: 7 U.S.C. 8111. 

Subpart A—Common Provisions 

§ 1450.1 Administration. 

(a) The regulations in this part are 

administered under the general 

supervision and direction of the 

Executive Vice President, Commodity 

Credit Corporation (CCC), or a designee. 

In the field, the regulations in this part 

will be implemented by the Farm 

Service Agency (FSA) State and county 

committees (‘‘State committees’’ and 

‘‘county committees,’’ respectively). 

(b) State executive directors, county 

executive directors, and State and 

county committees do not have the 

authority to modify or waive any of the 

provisions in this part unless 

specifically authorized by the FSA 

Deputy Administrator for Farm Program 

(Deputy Administrator). 

(c) The State committee may take any 

action authorized or required by this 

part to be taken by the county 

committee, but which has not been 

taken by such committee, such as: 

(1) Correct or require a county 

committee to correct any action taken by 

such county committee that is not in 

accordance with this part; or 

(2) Require a county committee to 

withhold taking any action that is not in 

accordance with this part. 

(d) No delegation of authority to a 

State or county committee will preclude 

the Executive Vice President, CCC, or a 

designee, from determining any 

question arising under this part or from 

reversing or modifying any 

determination made by a State or county 

committee. 

(e) Data furnished by participants will 

be used to determine eligibility for 

program benefits. Furnishing the data is 

voluntary; however, the failure to 

provide data could result in program 

benefits being withheld or denied. 

§ 1450.2 Definitions. 

(a) The definitions in part 718 of this 

chapter apply to this part and all 

documents issued in accordance with 

this part, except as otherwise provided 

in this section. 

(b) The following definitions apply to 

this part: 

Advanced biofuel means fuel derived 

from renewable biomass other than corn 

kernel starch, including biofuels derived 

from cellulose, hemicellulose, or lignin; 

biofuels derived from sugar and starch 

(other than ethanol derived from corn 

kernel starch); biofuel derived from 

waste material, including crop residue, 

other vegetative waste material, animal 

waste, food waste, and yard waste; 

diesel-equivalent fuel derived from 

renewable biomass including vegetable 

oil and animal fat; biogas (including 

landfill gas and sewage waste treatment 

gas) produced through the conversion of 

organic matter from renewable biomass; 

and butanol or other alcohols produced 

through the conversion of organic 

matter from renewable biomass; and 

other fuel derived from cellulosic 

biomass. 

Agricultural land means cropland, 

grassland, pastureland, rangeland, 

hayland, and other land on which food, 

fiber, or other agricultural products are 

produced or capable of being produced. 

Animal waste means the organic 

animal waste of animal operations such 

as confined beef or dairy, poultry, or 

swine operations including manure, 

contaminated runoff, milking house 

waste, dead poultry, bedding, and 

spilled feed. Depending on the poultry 

system, animal waste can also include 

litter, wash-flush water, and waste feed. 

Annual payment means the annual 

payment specified in the BCAP contract 

for BCAP project areas that is issued to 

a participant for placing eligible land in 

BCAP. 

Beginning farmer or rancher means, 

as determined by CCC, a person or 

entity who: 

(1) Has not been a farm or ranch 

operator or owner for more than 10 

years, 

(2) Materially and substantially 

participates in the operation of the farm 

or ranch, and 

(3) If an entity, is an entity in which 

at least 50 percent of the members or 

stockholders of the entity meet the first 

two requirements of this definition. 

Biobased product means a product 

determined by CCC to be a commercial 

or industrial product (other than food or 

feed) that is: 

(1) Composed, in whole or in 

significant part, of biological products, 

including renewable domestic 

agricultural materials and forestry 

materials; or 

(2) An intermediate ingredient or 

feedstock. 

Bioenergy means renewable energy 

produced from organic matter. Organic 

matter may be used directly as a fuel, be 

processed into liquids and gases, or be 

a residual of processing and conversion. 

Biofuel means a fuel derived from 

renewable biomass. 

Biomass conversion facility means a 

facility that converts or proposes to 

convert renewable biomass into heat, 

power, biobased products, or advanced 

biofuels. 

Conservation district is as defined in 

part 1410 of this chapter. 

Conservation plan means a schedule 

and record of the participant’s decisions 

and supporting information for 

treatment of a unit of land or water, and 

includes a schedule of operations, 

activities, and estimated expenditures 

for eligible crops and the collection or 

harvesting of eligible material, as 

appropriate, and addresses natural 

resource concerns including the 

sustainable harvesting of biomass, when 

appropriate, by addressing the sitespecific needs of the landowner. 

Contract acreage means eligible land 

that is covered by a BCAP contract 

between the producer and CCC. 

Delivery means the point of delivery 

of an eligible crop or eligible material, 

as determined by the CCC. 

Deputy Administrator means the FSA 

Deputy Administrator for Farm 

Programs, or a designee. 

Dry ton means one U.S. ton measuring 

2,000 pounds. One dry ton is the 

amount of renewable biomass that 

would weigh one U.S. ton at zero 

percent moisture content. 

Eligible crop means a crop of 

renewable biomass as defined in this 

section excluding: 

(1) Any crop that is eligible to receive 

payments under Title I, ‘‘Commodity 

Programs,’’ of the Food, Conservation, 

and Energy Act of 2008 (Pub. L. 110– 

246) or an amendment made by that 

title, including, but not limited to, 

barley, corn, grain sorghum, oats, rice, 

or wheat; honey; mohair; certain 

oilseeds such as canola, crambe, 

flaxseed, mustard seed, rapeseed, 

safflower seed, soybeans, sesame seed, 

and sunflower seeds; peanuts; pulse 

crops such as small chickpeas, lentils, 

and dry peas; dairy products; sugar; 

wool; and cotton boll fiber; and 

(2) Any plant that CCC has 

determined to be either a noxious weed 

or an invasive species. With respect to 

noxious weeds and invasive species, a 

list of such plants will be available in 

the FSA county office. 

Eligible material is renewable biomass 

as defined in this section excluding: 

(1) Material that is whole grain from 

any crop that is eligible to receive 


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payments under Title I of the Food, 

Conservation, and Energy Act of 2008 or 

an amendment made by that title, 

including, but not limited to, barley, 

corn, grain sorghum, oats, rice, or 

wheat; honey; or material that is mohair; 

certain oilseeds such as canola, crambe, 

flaxseed, mustard seed, rapeseed, 

safflower seed, soybeans, sesame seed, 

and sunflower seeds; peanuts; pulse 

crops such as small chickpeas, lentils, 

and dry peas; dairy products; sugar; 

wool; and cotton boll fiber; 

(2) Animal waste and by-products of 

animal waste including fats, oils, 

greases, and manure; 

(3) Food waste and yard waste; and 

(4) Algae. 

Eligible material owner, for purposes 

of the matching payment, means a 

person or entity having the right to 

collect or harvest eligible material, who 

has the risk of loss in the material that 

is delivered to an eligible facility and 

who has directly or by agent delivered 

or intends to deliver the eligible 

material to a qualified biomass 

conversion facility, including: 

(1) For eligible material harvested or 

collected from private lands, including 

cropland, the owner of the land, the 

operator or producer conducting 

farming operations on the land, or any 

other person designated by the owner of 

the land; and 

(2) For eligible material harvested or 

collected from public lands, a person 

having the right to harvest or collect 

eligible material pursuant to a contract 

or permit with the US Forest Service or 

other appropriate Federal agency, such 

as a timber sale contract, stewardship 

contract or agreement, service contract 

or permit, or related applicable Federal 

land permit or contract, and who has 

submitted a copy of the permit or 

contract authorizing such collection to 

CCC. 

Equivalent plan means a plan 

approved by a State or other State 

agency or government entity that is 

similar to and serves the same purpose 

as a forest stewardship plan and has 

similar goals, objectives, and terms. 

These plans generally address natural 

resource concerns including the 

sustainable harvesting of biomass, when 

appropriate, by addressing the sitespecific needs of the landowner. 

Establishment payment means the 

payment made by CCC to assist program 

participants in establishing the practices 

required for non-woody perennial crops 

and woody perennial crops, as specified 

in a producer contract under the project 

portion of BCAP. 

Food waste means, as determined by 

CCC, a material composed primarily of 

food items, or originating from food 

items, or compounds from domestic, 

municipal, food service operations, or 

commercial sources, including food 

processing wastes, residues, or scraps. 

Forest stewardship plan means a longterm, comprehensive, multi-resource 

forest management plan that is prepared 

by a professional resource manager and 

approved by the State Forester or 

equivalent State official. Forest 

stewardship plans address the following 

resource elements wherever present, in 

a manner that is compatible with 

landowner objectives concerning: 

(1) Soil and water; 

(2) Biological diversity; 

(3) Range; 

(4) Aesthetic quality; 

(5) Recreation; 

(6) Timber; 

(7) Fish and wildlife; 

(8) Threatened and endangered 

species; 

(9) Forest health; 

(10) Archeological, cultural and 

historic sites; 

(11) Wetlands; 

(12) Fire; and 

(13) Carbon cycle. 

Higher-value product means an 

existing market product that is 

comprised principally of an eligible 

material or materials and, in some 

distinct local regions, as determined by 

the CCC, has an existing market as of 

October 27, 2010. Higher-value products 

may include, but are not limited to, 

products such as mulch, fiberboard, 

nursery media, lumber, or paper. 

Highly erodible land means land as 

determined as specified in part 12 of 

this title. 

Indian tribe has the same meaning as 

in 25 U.S.C. 450b (section 4 of the 

Indian Self-Determination and 

Education Assistance Act). 

Institution of higher education has the 

same meaning as in 20 U.S.C. 1002(a) 

(section 102(a) of the Higher Education 

Act of 1965). 

Intermediate ingredient or feedstock 

means an ingredient or compound made 

in whole or in significant part from 

biological products, including 

renewable agricultural material 

(including plant, animal, and marine 

material), or forestry material that is 

subsequently used to make a more 

complex compound or product. 

Legal entity has the same meaning as 

in the regulations in § 1400.3 of this 

chapter. 

Matching payments means those CCC 

payments provided for eligible material 

delivered to a qualified biomass 

conversion facility. 

Native sod means land: 

(1) On which the plant cover is 

composed principally of native grasses, 

grasslike plants, forbs, or shrubs suitable 

for grazing and browsing; and 

(2) That had never been tilled for the 

production of an annual crop as of June 

18, 2008. 

Nonindustrial private forest land 

means, as defined in 16 U.S.C. 2103a 

(the Cooperative Forestry Assistance Act 

of 1978, as amended), rural lands with 

existing tree cover, or suitable for 

growing trees, where the land is owned 

by any private individual, group, 

association, corporation, Indian tribe, or 

other private legal entity. 

Offer means, unless otherwise 

indicated, the per-acre rental payment 

requested by the owner or operator in 

such owner’s or operator’s request to 

participate in the establishment 

payment and annual payment 

component of BCAP. 

Operator means a person who is in 

general control of the land enrolled in 

BCAP, as determined by CCC. 

Participant means a person who is 

participating in BCAP—either as a 

person who has applied for and is 

eligible to receive payments, has a 

BCAP contract, or is a project sponsor. 

Payment period means a contract 

period of either up to 5 years for annual 

and non-woody perennial crops, or up 

to 15 years for woody perennial crops, 

during which the participant receives an 

annual payment under the 

establishment payment and annual 

payment component of BCAP. 

Person has the same meaning as in the 

regulations in § 1400.3 of this chapter. 

In addition, for BCAP, the term 

‘‘producer’’ means either an owner or 

operator of BCAP project acreage that is 

physically located in a BCAP project 

area, or a producer of an eligible crop 

produced on that acreage. 

Producer means, with respect to 

subpart B of this part, a person who had 

the risk of loss in the production of the 

material that is the subject of the BCAP 

payment; and with respect to subpart C 

of this part, an owner or operator of 

contract acreage that is physically 

located within a BCAP project area or a 

producer of an eligible crop produced 

on that acreage and who has the risk of 

loss in the relevant crop at the relevant 

period of time or who will have the risk 

of loss in crops required to be produced. 

Project area means a geographic area 

with specified boundaries submitted by 

a project sponsor and approved by CCC 

under the establishment payment and 

annual payment component of BCAP. 

Project sponsor means a group of 

producers or a biomass conversion 

facility who proposes a project area. 

Qualified biomass conversion facility 

means a biomass conversion facility that 

meets all the requirements for BCAP 


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qualification, and whose facility 

representatives enter into a BCAP 

agreement with CCC. 

Renewable biomass means: 

(1) Appropriate materials, precommercial thinnings, or invasive 

species from National Forest System 

land and U.S. Department of the 

Interior, Bureau of Land Management 

land that: 

(i) Are by-products of preventive 

treatments that are removed to reduce 

hazardous fuels, to reduce or contain 

disease or insect infestation, or to 

restore ecosystem health; 

(ii) Would not otherwise be used for 

higher-value products; and 

(iii) Are harvested in accordance with 

applicable law and land management 

plans and the requirements for oldgrowth maintenance, restoration, and 

management direction of 16 U.S.C. 6512 

(specifically, sections 102(e)(2), (3), and 

(4) of the Healthy Forests Restoration 

Act of 2003 and large-tree retention 

provisions of subsection (f)); or 

(2) Any organic matter that is 

available on a renewable or recurring 

basis from non-Federal land or land 

belonging to an Indian or Indian Tribe 

that is held in trust by the United States 

or subject to a restriction against 

alienation imposed by the United States, 

including: 

(i) Renewable plant material, 

including: 

(A) Feed grains; 

(B) Other agricultural commodities; 

(C) Other plants and trees; or 

(D) Algae; 

(ii) Waste material, including: 

(A) Crop residue; 

(B) Other vegetative waste material 

(including wood waste and wood 

residues); 

(C) Animal waste and byproducts 

(including fats, oils, greases, and 

manure); and 

(D) Food waste and yard waste. 

Socially disadvantaged farmer or 

rancher means, unless other classes of 

persons are approved by CCC in writing, 

a farmer or rancher who is a member of 

a group whose members have been 

subject to racial or ethnic prejudice 

because of their identity as members of 

a group without regard to their 

individual qualities. Groups include: 

(1) American Indians or Alaskan 

Natives; 

(2) Asians or Asian Americans; 

(3) Blacks or African Americans; 

(4) Native Hawaiians or other Pacific 

Islanders; and 

(5) Hispanics. 

Technical assistance means assistance 

in determining the eligibility of land 

and practices for BCAP, implementing 

and certifying practices, ensuring 

contract performance, and providing 

annual rental rate surveys. The 

technical assistance provided in 

connection with BCAP to owners or 

operators, as approved by CCC, 

includes, but is not limited to: 

Technical expertise, information, and 

tools necessary for the conservation of 

natural resources on land; technical 

services provided directly to farmers, 

ranchers, and other eligible entities, 

such as conservation planning, 

technical consultation, and assistance 

with design and implementation of 

eligible practices; and technical 

infrastructure, including activities, 

processes, tools, and functions needed 

to support delivery of technical services, 

such as technical standards, resource 

inventories, training, data, technology, 

monitoring, and effects analyses. 

Tribal government means any Indian 

tribe, band, nation, or other organized 

group, or community, including 

pueblos, rancherias, colonies and any 

Alaska Native Village, or regional or 

village corporation as defined in or 

established pursuant to 43 U.S.C. 1601– 

1629h (the Alaska Native Claims 

Settlement Act), that is recognized as 

eligible for the special programs and 

services provided by the United States 

to Indians because of their status as 

Indians. 

Violation means an act by the 

participant, either intentional or 

unintentional, that would cause the 

participant to no longer be eligible to 

receive or retain all or a portion of 

BCAP payments. 

Yard waste means any renewable 

biomass generated from municipal or 

residential land, such as urban forestry 

materials, construction or demolition 

materials, trimmings from grasses and 

trees, or biomass removed due to 

invasive species or weather-related 

disaster, that can be separated from and 

has low potential (such as 

contamination with plastics, metals, 

chemicals, or other toxic compounds 

that cannot be removed) for the 

generation of toxic byproducts resulting 

from conversion, and that otherwise 

cannot be recycled for other purposes 

(such as post-consumer waste paper). 

§ 1450.3 General. 

(a) The objectives of BCAP are to: 

(1) Support the establishment and 

production of eligible crops for 

conversion to bioenergy and biobased 

products in selected project areas; and 

(2) Assist agricultural and forest 

landowners and operators with 

matching payments to support the 

collection, harvest, storage, and 

transportation costs of eligible material 

for use in a biomass conversion facility. 

(b) A participant must implement and 

adhere to a conservation plan, forest 

stewardship plan, or equivalent plan 

prepared in accordance with BCAP 

guidelines, as established and 

determined by CCC. A conservation 

plan, forest stewardship plan, or 

equivalent plan for contract acreage 

must be implemented by a participant 

and must be approved by the 

conservation district in which the lands 

are located, or, in the case of Federal 

lands, the appropriate approval 

authority of jurisdiction. If the 

conservation district declines to review 

the conservation plan, forest 

stewardship plan, or equivalent plan, 

the provider of technical assistance may 

take such further action as is needed to 

account for lack of such review. 

(c) Agricultural and forest landowners 

and operators must comply with any 

applicable existing conservation plan, 

forest stewardship plan, or equivalent 

plan and all other applicable laws, 

regulations, or Executive Orders for any 

removal of eligible material for use in a 

biomass conversion facility to receive 

matching payments. 

(d) Except as otherwise provided in 

this part, a participant may receive, in 

addition to any payments under this 

part, financial assistance, rental or 

easement payments, tax benefits, or 

other payments from a State or a private 

organization in return for enrolling 

lands in BCAP, without any 

commensurate reduction in BCAP 

payments. 

§ 1450.4 Violations. 

(a)(1) If a participant fails to carry out 

the terms and conditions of a BCAP 

contract, CCC may terminate the BCAP 

contract. 

(2) If the BCAP contract is terminated 

by CCC in accordance with this 

paragraph: 

(i) The participant will forfeit all 

rights to further payments under the 

contract and must refund all payments 

previously received, plus interest; and 

(ii) The participant must pay 

liquidated damages to CCC in an 

amount as specified in the contract. 

(b) CCC may reduce a demand for a 

refund under this section to the extent 

CCC determines that such relief would 

be appropriate and would not deter the 

accomplishment of the purposes of 

BCAP. 

§ 1450.5 Performance based on advice or 

action of USDA. 

(a) The provisions of § 718.303 of this 

title relating to performance based on 

the action or advice of an authorized 

representative of USDA applies to this 

part, and may be considered as a basis 


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to provide relief to persons subject to 

sanctions under this part to the extent 

that relief is otherwise permitted by this 

part. 

(b) [Reserved] 

§ 1450.6 Access to land. 

(a) For purposes related to this 

program, the participant must upon 

request provide any representative of 

USDA, or designee thereof, with access 

to land that is: 

(1) The subject of an application for 

a contract under this part; or 

(2) Under contract or otherwise 

subject to this part. 

(b) For land identified in paragraph 

(a) of this section, the participant must 

provide such representatives or 

designees with access to examine 

records for the land to determine land 

classification, eligibility, or for other 

purposes, and to determine whether the 

participant is in compliance with the 

terms and conditions of the BCAP 

contract. 

§ 1450.7 Division of payments and 

provisions about tenants and 

sharecroppers. 

(a) Payments received under this part 

will be divided as specified in the 

applicable contract. CCC may refuse to 

enter into a contract when there is a 

disagreement among persons or legal 

entities seeking enrollment as to a 

person’s or legal entity’s eligibility to 

participate in the contract as a tenant or 

sharecropper, and there is insufficient 

evidence, as determined by CCC, to 

indicate whether the person or legal 

entity seeking participation as a tenant 

or sharecropper has an interest in the 

acreage offered for enrollment in the 

BCAP. 

(b) CCC may remove an operator or 

tenant from a BCAP contract when: 

(1) The operator or tenant requests in 

writing to be removed from the BCAP 

contract; 

(2) The operator or tenant files for 

bankruptcy and the trustee or debtor in 

possession fails to affirm the contract, to 

the extent permitted by applicable 

bankruptcy laws; 

(3) The operator or tenant dies during 

the contract period and the 

administrator of the estate fails to 

succeed to the contract within a period 

of time determined appropriate by CCC; 

or 

(4) A court of competent jurisdiction 

orders the removal of the operator or 

tenant from the BCAP contract and such 

order is received by CCC. 

(c) Tenants who fail to maintain 

tenancy on the acreage under contract 

for any reason may be removed from a 

contract by CCC. 

§ 1450.8 Payments not subject to claims. 

(a) Subject to part 1403 of this 

chapter, any payment or portion of the 

payment due any person or legal entity 

under this part will be allowed without 

regard to questions of title under State 

law, and without regard to any claim or 

lien in favor of any creditor, except 

agencies of the U.S. Government. 

(b) [Reserved] 

§ 1450.9 Assignments. 

(a) Participants may assign the right to 

receive cash payments under BCAP, in 

whole or in part, as provided in part 

1404 of this chapter. 

(b) [Reserved] 

§ 1450.10 Appeals. 

(a) Except as provided in paragraph 

(b) of this section, a person or legal 

entity applying for participation may 

appeal or request reconsideration of an 

adverse determination in accordance 

with the administrative appeal 

regulations at parts 11 and 780 of this 

title. 

(b) Determinations by the Natural 

Resources Conservation Service may be 

appealed in accordance with procedures 

established under part 614 of this title 

or otherwise established by the Natural 

Resources Conservation Service. 

§ 1450.11 Scheme or device. 

(a) If CCC determines that a person or 

legal entity has employed a scheme or 

device to defeat the purposes of this 

part, or any part, of any USDA program, 

payment otherwise due or paid such 

person or legal entity during the 

applicable period may be required to be 

refunded, with interest calculated from 

the date of disbursement of the funds by 

CCC, as determined appropriate by CCC. 

(b) A scheme or device includes, but 

is not limited to, coercion, fraud, 

misrepresentation, depriving any other 

person or legal entity of any payments, 

or obtaining a payment that otherwise 

would not be payable. 

(c) A new owner or operator or tenant 

of land subject to this part who succeeds 

to the contract responsibilities must 

report in writing to CCC any interest of 

any kind in the land subject to this part 

that is retained by a previous 

participant. Such interest may include a 

present, future, or conditional interest, 

reversionary interest, or any option, 

future or present, on such land, and any 

interest of any lender in such land 

where the lender has, will, or can 

legally obtain, a right of occupancy to 

such land or an interest in the equity in 

such land other than an interest in the 

appreciation in the value of such land 

occurring after the loan was made. 

Failure to fully disclose such interest 

will be considered a scheme or device 

under this section. 

§ 1450.12 Filing of false claims. 

(a) If CCC determines that any 

participant has knowingly supplied 

false information or has knowingly filed 

a false claim, such participant will be 

ineligible for payments under this part 

with respect to the fiscal year in which 

the false information or claim was filed 

and the contract may be terminated, in 

which case CCC may demand a full 

refund of all prior payments. 

(b) False information or false claims 

include, but are not limited to, claims 

for payment for practices that do not 

comply with the conservation plan, 

forest stewardship plan, or equivalent 

plan. Any amounts paid under these 

circumstances must be refunded to CCC, 

together with interest as determined by 

CCC, and any amounts otherwise due 

the participant will be withheld. 

(c) The remedies provided for in this 

section will be in addition to any other 

remedy available to CCC and in addition 

to any criminal penalty or any other 

remedy available to the United States. 

§ 1450.13 Miscellaneous. 

(a) Except as otherwise provided in 

this part, in the case of death, 

incompetency, or disappearance of any 

participant, any payments due under 

this part may be paid to the participant’s 

successor(s) in accordance with part 707 

of this title. 

(b) Unless otherwise specified in this 

part, payments under this part will be 

subject to the compliance requirements 

of part 12 of this title concerning highly 

erodible land and wetland conservation 

and payments. 

(c) Any remedies permitted CCC 

under this part will be in addition to 

any other remedy, including, but not 

limited to, criminal remedies or actions 

for damages in favor of CCC, or the 

United States as may be permitted by 

law. 

(d) Absent a scheme or device to 

defeat the purposes of BCAP, when an 

owner loses control of BCAP acreage 

enrolled under subpart C of this part 

due to foreclosure and the new owner 

chooses not to continue the contract in 

accordance with § 1450.215 refunds will 

not be required from any participant on 

the contract to the extent that the 

Deputy Administrator determines that 

forgiving such repayment is appropriate 

in order to provide fair and equitable 

treatment. 

Subpart B—Matching Payments 

§ 1450.100 General. 

(a) A person or legal entity with the 

right to collect or harvest eligible 


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material for the sale and delivery of 

such eligible material to a qualified 

biomass conversion facility, may be 

eligible for payment under the 

provisions of this subpart. 

(b) [Reserved] 

§ 1450.101 Qualified biomass conversion 

facility. 

(a) To be considered a qualified 

biomass conversion facility, a biomass 

conversion facility must enter into an 

agreement with CCC and must: 

(1) Meet all applicable regulatory and 

permitting requirements by applicable 

Federal, State, or local authorities; 

(2) Agree in writing to: 

(i) Maintain accurate records of all 

eligible material purchases and related 

documents regardless of whether 

matching payments will be sought by 

the seller; and 

(ii) Make available at one place and at 

all reasonable times for examination by 

representatives of USDA, all books, 

papers, records, contracts, scale tickets, 

settlement sheets, invoices, written 

price quotations, or other documents 

related to BCAP for not less than 3 years 

after the date that eligible material was 

delivered to the qualified biomass 

conversion facility; 

(iii) Clearly indicate the actual 

tonnage delivered on the scale ticket or 

equivalent to be provided to the eligible 

material owner; 

(iv) Calculate a total dry ton weight 

equivalent of the actual tonnage 

delivered and provide that measurement 

to the eligible material owner; 

(v) Use commercial weight scales that 

are certified for accuracy by applicable 

State or local authorities and accurate 

moisture measurement equipment to 

determine the dry ton weight equivalent 

of actual tonnage delivered; 

(vi) Pay fair market value for eligible 

material regardless of whether the seller 

has applied for or receives a matching 

payment authorized by this subpart. 

(b) For a qualified biomass conversion 

facility, CCC can: 

(1) Periodically inform the public that 

payments may be available for 

deliveries of eligible material to such 

qualified biomass conversion facility; 

(2) Maintain a listing of qualified 

biomass conversion facilities for general 

public access and distribution that may 

include general information about the 

facility and its eligible material needs; 

and 

(3) Suspend, terminate, or take other 

actions as appropriate when CCC 

determines a qualified biomass 

conversion facility fails to comply with 

the agreement. 

§ 1450.102 Eligible material owner. 

(a) In order to be eligible for a 

payment under this subpart, a person or 

legal entity must: 

(1) Be a producer of an eligible crop 

that is produced on contract acreage 

authorized by subpart C of this part; or 

(2) Have the right to collect or harvest 

eligible material and such person may 

only receive payment if the risk of loss 

for the material transferred to that 

person occurred prior to the time the 

payment is made that will be used to 

determine the matching payment that is 

requested under this subpart; and 

(3) Certify that the eligible material for 

which a payment may be issued 

according to § 1450.106 has been 

harvested according to a conservation 

plan, forest stewardship plan, or 

equivalent plan, and, if not crop 

residues, are byproducts of preventative 

treatments that are removed to reduce 

hazardous fuels, to reduce or contain 

disease or insect infestation, or to 

restore ecosystem health. 

(b) A qualified biomass conversion 

facility that meets the requirements of 

paragraph (a) of this section may be 

considered an eligible material owner if 

it otherwise meets the definition in this 

part. 

§ 1450.103 Eligible material that qualifies 

for payment. 

(a) Except for paragraph (b) of this 

section, in order to qualify, as 

determined by CCC, for a payment 

under this subpart: 

(1) Eligible material must be 

renewable biomass that, at a minimum, 

meets the definition in § 1450.2 and is 

listed on the official Web site for BCAP 

as an eligible material at http:// 

www.fsa.usda.gov/energy; 

(2) Eligible material must be collected 

or harvested by the eligible material 

owner: 

(i) Directly from: 

(A) National Forest System land, 

Bureau of Land Management land; 

(B) Non-Federal land; or 

(C) Land belonging to an Indian or 

Indian tribe that is held in trust by the 

United States or subject to a restriction 

against alienation imposed by the 

United States; 

(ii) Consistent with a conservation 

plan, forest stewardship plan, or plan 

that CCC determined to be an equivalent 

plan, that provides the following: 

(A) The purpose of the harvest of the 

eligible material; 

(B) The expected volume of the 

harvest; 

(C) The total number of acres to be 

harvested; 

(D) The name of the eligible material 

owner(s); and 

(E) Any additional information, as 

determined by CCC; and 

(iii) Consistent with Executive Order 

13112, ‘‘Invasive Species. ’’ 

(3) Woody eligible material produced 

on land other than contract acreage 

must be: 

(i) Byproducts of preventative 

treatments that are removed to reduce 

hazardous fuels, to reduce or contain 

disease or insect infestation, or to 

restore ecosystem health; and 

(ii) If harvested from Federal lands 

then done so in accordance with the 

requirements for old-growth 

maintenance, restoration, and 

management direction provided by 16 

U.S.C. 6512 for Federal lands; and 

(4) Eligible material must be delivered 

to a qualified biomass conversion 

facility (as specified in § 1450.101 and 

other provisions of these regulations). 

(b) Notwithstanding paragraph (a) of 

this section, payments under this 

subpart are not authorized for: 

(1) Any eligible material delivered 

before October 27, 2010; 

(2) Any eligible material for which 

payment from a biomass conversion 

facility was received before the 

application for payment under this 

subpart is received and approved by the 

FSA county office, as specified in 

§ 1450.104; 

(3) Any woody eligible material 

collected or harvested outside contract 

acreage that would otherwise be used 

for higher-value products; or 

(4) Any otherwise eligible material 

collected or harvested outside contract 

acreage that, after delivery to a biomass 

conversion facility, its campus, or its 

affiliated facilities, must be separated 

from an eligible material used for a 

higher-value market product in order to 

be used for heat, power, biobased 

products, or advanced biofuels. 

§ 1450.104 Signup. 

(a) Applications for participation and 

requests for payments under this 

subpart will be accepted on a 

continuous basis. 

(b) An eligible material owner must 

apply to participate in the matching 

payments component of BCAP before 

payment for the eligible material is 

received from a qualified biomass 

conversion facility. The application 

must be submitted to the FSA county 

office and approved by CCC before any 

payment is made by the qualified 

biomass conversion facility for the 

eligible material. 

(c) Applications must include the 

following: 

(1) Based on information obtained 

from contracts, agreements, or binding 

letters of intent: 


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(i) An estimate of the total dry tons of 

eligible material expected to be sold to 

the qualified biomass conversion 

facility; 

(ii) The type(s) of eligible material 

that is expected to be sold; 

(iii) The name of the qualified 

biomass conversion facility that will 

purchase the eligible material; 

(iv) The expected, fair market, per dry 

ton payment rate the owner plans to 

receive for the delivery of the eligible 

material; and 

(v) The date or dates the eligible 

material is expected to be delivered to 

the qualified biomass conversion 

facility. 

(2) A new or amended conservation 

plan, forest stewardship plan, or 

equivalent plan, as specified in 

§ 1450.103. 

(d) Eligible material owners who 

deliver eligible material to more than 

one qualified biomass conversion 

facility must submit separate 

applications for each facility to which 

eligible material will be delivered. 

(e) After delivery, eligible material 

owners must notify CCC and request the 

payment. Payments will be disbursed 

only after delivery is verified by CCC. 

(f) Information that must be submitted 

to CCC in order to request payments 

includes settlement, summary, or other 

acceptable data that provide: 

(1) Total actual tonnage delivered and 

a total dry weight tonnage equivalent 

amount determined by the qualified 

biomass conversion facility using 

standard moisture determinations 

applicable to the eligible material; 

(2) Total payment received, including 

the per dry-ton payment rate(s) matched 

with actual and dry weight tonnage 

delivered; and 

(3) The qualified biomass conversion 

facility’s certification as to the 

authenticity of the information. 

§ 1450.105 Obligations of participant. 

(a) All participants whose payment 

application was approved must agree to: 

(1) Carry out and certify compliance 

with the terms and conditions of the 

payment application including 

adherence to a conservation plan, forest 

stewardship plan, or equivalent plan, as 

appropriate; and 

(2) Be jointly and severally 

responsible, if the participant has a 

share of the payment greater than zero, 

with other contract participants for 

compliance with the provisions of such 

contract and the provisions of this part, 

and for any refunds or payment 

adjustments that may be required for 

violations of any of the terms and 

conditions of the BCAP contract and 

this part. 

(b) [Reserved] 

§ 1450.106 Payments. 

(a) Payments under this subpart will 

be for a term not to exceed 2 years 

beginning the date that CCC issues the 

first payment, under this subpart to the 

participant and for each participant runs 

from the date that the participant 

receives a matching payment from CCC 

even though the participant may over 

time change facilities. The Deputy 

Administrator may further limit the 

period to reflect participation in BCAP 

for any time prior to October 27, 2010 

as the Deputy Administrator deems 

appropriate. In addition, where 

ownership of a source of material has 

changed, or where it is deemed that 

other circumstances warrant, the Deputy 

Administrator may apply the time limit 

applicable to a person or entity or to 

another person or entity to assure that 

the 2-year limit is not avoided by 

private arrangement or other 

circumstance. 

(b) Payments under this subpart will 

be paid at a rate of $1 for each $1 per 

dry ton provided by the qualified 

biomass conversion facility for the 

market-based sale of eligible material in 

an amount up to $45 per dry ton. 

Subpart C—Establishment Payments 

and Annual Payments 

§ 1450.200 General. 

(a) As provided in this subpart, 

establishment payments and annual 

payments may be provided by CCC to 

producers of eligible crops within a 

project area. 

(b) [Reserved] 

§ 1450.201 Project area proposal 

submission requirements. 

(a) To be considered for selection as 

a project area, a project sponsor must 

submit a proposal to CCC that includes, 

at a minimum: 

(1) A description of the sources of 

renewable biomass, eligible land, and 

eligible crops that may be enrolled 

within the proposed project area; 

(2) A letter of commitment from a 

biomass conversion facility stating that 

the facility will use, for BCAP purposes, 

eligible crops intended to be produced 

in the proposed project area; 

(3) Information demonstrating that the 

biomass conversion facility will have 

sufficient equity available to operate if 

the facility is not operational at the time 

the project area proposal is submitted; 

and 

(4) Other information that gives CCC 

a reasonable assurance that the biomass 

conversion facility will be in operation 

in a timely manner so that it will utilize 

the eligible crops, as determined by 

CCC. 

(b) The project area description 

required in paragraph (a) of this section 

needs to specify geographic boundaries 

and be described in definite terms such 

as acres, watershed boundaries, mapped 

longitude and latitude coordinates, or 

counties. 

(c) The project area needs to be 

physically located near a biomass 

conversion facility or facilities, as 

determined by CCC. 

(d) Project area proposals may limit 

the nature and types of eligible crops to 

be established within a project area. 

§ 1450.202 Project area selection criteria. 

(a) In selecting project areas, CCC will 

consider: 

(1) The dry tons of the eligible crops 

proposed to be produced in the 

proposed project area and the 

probability that such crops will be used 

for BCAP purposes; 

(2) The dry tons of renewable biomass 

projected to be available from sources 

other than the eligible crops grown on 

contract acres; 

(3) The anticipated economic impact 

in the proposed project area; 

(4) The opportunity for producers and 

local investors to participate in the 

ownership of the biomass conversion 

facility in the proposed project area; 

(5) The participation rate by 

beginning or socially disadvantaged 

farmers or ranchers; 

(6) The impact on soil, water, and 

related resources; 

(7) The variety in biomass production 

approaches within a project area, 

including agronomic conditions, harvest 

and postharvest practices, and 

monoculture and polyculture crop 

mixes; 

(8) The range of eligible crops among 

project areas; and 

(9) Any other additional criteria, as 

determined by CCC. 

(b) [Reserved] 

§ 1450.203 Eligible persons and legal 

entities. 

(a) In order to be eligible to enter into 

a BCAP contract for this subpart, a 

person or legal entity must be an owner, 

operator, or tenant of eligible land 

within a project area, as defined in 

§ 1450.204 and be the person or entity 

with the ability to perform under the 

terms of the contract. 

(b) [Reserved] 

§ 1450.204 Eligible land. 

(a) For the purposes of this subpart, 

eligible land must be physically and 

legally capable of producing an eligible 

crop and must be: 


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(1) Agricultural land; or 

(2) Nonindustrial private forest land. 

(b) For the purposes of this subpart, 

eligible land is not: 

(1) Federal- or State-owned land, 

including land owned by local 

governments or municipalities; 

(2) Land that is native sod; 

(3) Land enrolled in the Conservation 

Reserve Program operated under part 

1410 of this chapter; 

(4) Land enrolled in the Wetlands 

Reserve Program operated under part 

1467 of this chapter; or 

(5) Land enrolled in the Grassland 

Reserve Program operated under part 

1415 of this chapter. 

§ 1450.205 Duration of contracts. 

(a) Contracts under this subpart will 

be for a term of up to: 

(1) 5 years for annual and non-woody 

perennial crops; and 

(2) 15 years for woody perennial 

crops. 

(b) The establishment time period 

may vary due to: Type of crop, 

agronomic conditions (for example, 

establishment time frame, winter 

hardiness), and other factors. 

§ 1450.206 Obligations of participant. 

(a) All participants subject to a BCAP 

contract must: 

(1) Carry out the terms and conditions 

of the contract; 

(2) Make available to CCC or to an 

institution of higher education or other 

entity designated by CCC, such 

information as CCC determines to be 

appropriate to promote the production 

of eligible crops and the development of 

renewable biomass conversion 

technology; 

(3) Comply with the highly erodible 

land and wetland conservation 

requirements of part 12 of this chapter; 

(4) Implement a: 

(i) Conservation plan, 

(ii) Forest stewardship plan, or 

(iii) Equivalent plan. 

(5) Implement the conservation plan, 

forest stewardship plan, or equivalent 

plan which is part of such contract, in 

accordance with the schedule of dates 

included in such conservation plan, 

forest stewardship plan, or equivalent 

plan, unless CCC determines that the 

participant cannot fully implement the 

conservation plan, forest stewardship 

plan, or equivalent plan for reasons 

beyond the producer’s control and CCC 

and the participant agree to a modified 

plan. 

(6) Demonstrate compliance with the 

conservation plan, forest stewardship 

plan, or equivalent plan through 

required self-certification subject to 

compliance spot checks, as determined 

by CCC. 

(7) Establish temporary vegetative 

cover either within the timeframes 

required by the conservation plan, forest 

stewardship plan, or equivalent plan or 

as determined by the Deputy 

Administrator, if the eligible crops 

cannot be timely established; and 

(8) If the participant has a share of the 

payment greater than zero, be jointly 

and severally responsible with the other 

contract participants for compliance 

with the provisions of such contract and 

the provisions of this part, and for any 

refunds or payment adjustments that 

may be required for violations of any of 

the terms and conditions of the contract 

and this part. 

(b) Payments may cease and 

producers may be subject to contract 

termination for failure to establish 

eligible crops. 

(c) A contract will not be terminated 

for failure by the participant to establish 

an approved cover on the land if, as 

determined by CCC: 

(1) The failure to plant or establish 

such cover was due to a natural disaster 

such as excessive rainfall, flooding, or 

drought; and 

(2) The participant establishes the 

approved cover as soon as practicable 

after the wet or drought conditions that 

prevented the establishment of such 

cover subside. 

§ 1450.207 Conservation plan, forest 

stewardship plan, or equivalent plan. 

(a) The producer must implement a 

conservation plan, forest stewardship 

plan, or equivalent plan that complies 

with CCC guidelines and is approved by 

the appropriate conservation district for 

the land to be entered in BCAP. If the 

conservation district declines to review 

the conservation plan, forest 

stewardship plan, or equivalent plan, or 

disapproves the conservation plan, 

forest stewardship plan, or equivalent 

plan, such approval may be waived by 

CCC. 

(b) The practices and management 

activities included in a conservation 

plan, forest stewardship plan, or 

equivalent plan, and agreed to by the 

producer, must be implemented in a 

cost-effective manner that meets BCAP 

purposes as determined by CCC. 

(c) If applicable, a tree planting plan 

must be developed and included in the 

conservation plan, forest stewardship 

plan, or equivalent plan. Such tree 

planting plan may allow a reasonable 

time to complete plantings, as 

determined by CCC. 

(d) Each conservation plan, forest 

stewardship plan, or equivalent plan, 

and any revision of the plan, will be 

subject to approval by CCC. 

1450.208 Eligible practices. 

(a) Eligible practices are those 

practices specified in the conservation 

plan, forest stewardship plan, or 

equivalent plan that meet all standards 

needed to cost-effectively establish: 

(1) Annual crops; 

(2) Non-woody perennial crops; and 

(3) Woody perennial crops. 

(b) [Reserved] 

§ 1450.209 Signup. 

(a) Offers for contracts may be 

submitted on a continuous basis to CCC 

as determined by the Deputy 

Administrator. 

(b) [Reserved] 

§ 1450.210 Acceptability of offers. 

(a) Acceptance or rejection of any 

contract offered will be at the sole 

discretion of CCC, and offers may be 

rejected for any reason as determined 

appropriate to accomplish the purposes 

of BCAP. 

(b) An offer to enroll land in BCAP 

will be irrevocable for such period as is 

determined and announced by CCC. The 

producer will be liable to CCC for 

liquidated damages if the applicant 

revokes an offer during the period in 

which the offer is irrevocable as 

determined by CCC. CCC may waive 

payment of such liquidated damages if 

CCC determines that the assessment of 

such damages, in a particular case, is 

not in the best interest of CCC and 

BCAP. 

§ 1450.211 BCAP contract. 

(a) In order to enroll land in BCAP, 

the participant must enter into a 

contract with CCC. 

(b) The contract is comprised of: 

(1) The terms and conditions for 

participation in BCAP; 

(2) The conservation plan, forest 

stewardship plan, or equivalent plan; 

and 

(3) Any other materials or agreements 

determined necessary by CCC. 

(c) In order to enter into a contract, 

the producer must submit an offer to 

participate as specified in § 1450.209; 

(d) The contract must, within the 

dates established by CCC, be signed by: 

(1) The producer; and 

(2) The owners of the eligible land to 

be placed in the BCAP and other eligible 

participants, if applicable. 

(e) The Deputy Administrator is 

authorized to approve contracts on 

behalf of CCC. 

(f) CCC will honor contracts even in 

the event that a project area biomass 

conversion facility does not become 

fully or partially operational. 

(g) Contracts may be terminated by 

CCC before the full term of the contract 

has expired if: 


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(1) The owner loses control of or 

transfers all or part of the acreage under 

contract and the new owner does not 

wish to continue the contract; 

(2) The participant voluntarily 

requests in writing to terminate the 

contract and obtains the approval of 

CCC according to terms and conditions 

as determined by CCC; 

(3) The participant is not in 

compliance with the terms and 

conditions of the contract; 

(4) The BCAP practice fails or is not 

established after a certain time period, 

as determined CCC, and the cost of 

restoring or establishing the practice 

outweighs the benefits received from the 

restoration or establishment; 

(5) The contract was approved based 

on erroneous eligibility determinations; 

or 

(6) CCC determines that such a 

termination is needed in the public 

interest. 

(h) Except as allowed and approved 

by CCC where the new owner of land 

enrolled in BCAP is a Federal agency 

that agrees to abide by the terms and 

conditions of the terminated contract, 

the participant in a contract that has 

been terminated must refund all or part 

of the payments made with respect to 

the contract plus interest, as determined 

by CCC, and must pay liquidated 

damages as provided for in the contract 

and this part. CCC may permit the 

amount(s) to be repaid to be reduced to 

the extent that such a reduction will not 

impair the purposes of BCAP. Further, 

a refund of all payments need not be 

required from a participant who is 

otherwise in full compliance with the 

contract when the land is purchased by 

or for the United States, as determined 

appropriate by CCC. 

§ 1450.212 Establishment payments. 

(a) Establishment payments will be 

made available upon a determination by 

CCC that an eligible practice, or an 

identifiable portion of a practice, has 

been established in compliance with the 

appropriate standards and 

specifications. 

(b) Except as otherwise provided for 

in this part, such payments will be 

made only for the cost-effective 

establishment or installation of an 

eligible practice, as determined by CCC. 

(c) Except as provided in paragraph 

(d) of this section, such payments will 

not be made to the same owner or 

operator on the same acreage for any 

eligible practices that have been 

previously established, or for which 

such owner or operator has received 

establishment assistance from any 

Federal agency. 

(d) Establishment payments may be 

authorized for the replacement or 

restoration of practices on land for 

which assistance has been previously 

allowed under BCAP, only if the failure 

of the original practice was due to 

reasons beyond the control of the 

participant, as agreed to by CCC. 

(e) In addition, CCC may make partial 

payments when the participant 

completes identifiable components of 

the contract. CCC may make 

supplemental establishment payments, 

if necessary. 

§ 1450.213 Levels and rates for 

establishment payments. 

(a) CCC will pay not more than 75 

percent of the actual or average cost 

(whichever is lower) of establishing 

non-woody perennial crops and woody 

perennial crops specified in the 

conservation plan, forest stewardship 

plan, or equivalent plan. 

(b) The average cost of performing a 

practice may be determined by CCC 

based on recommendations from the 

State Technical Committee. Such cost 

may be the average cost in a State, a 

county, or a part of a State or county, 

as determined by CCC. This means that 

the calculated 75 percent of the average 

cost may represent less than 75 percent 

of the actual cost for an individual 

participant. 

(c) Except as otherwise provided for 

in this part, a participant may receive, 

in addition to any payment under this 

part, establishment assistance, rental 

payments, or tax benefits from a State or 

a private organization in return for 

enrolling lands in BCAP without a 

commensurate reduction in BCAP 

establishment payments. 

§ 1450.214 Annual payments. 

(a) Annual payments will be made in 

such amount and in accordance with 

such time schedule as may be agreed 

upon and specified in the BCAP 

contract. 

(b) Based on the regulations in 

§ 1410.42 of this chapter and as 

determined by CCC, annual payments 

include a payment based on all or a 

percentage of: 

(1) A weighted average soil rental rate 

for cropland; 

(2) The applicable marginal 

pastureland rental rate for all other land 

except for nonindustrial private forest 

land; 

(3) For forest land, the average county 

rental rate for cropland as adjusted for 

forest land productivity for 

nonindustrial private forest land; and 

(4) Any incentive payment as 

determined by CCC. 

(c) The annual payment will be 

divided among the participants on a 

single contract as agreed to in such 

contract, as determined by CCC. 

(d) A participant that has an 

established eligible crop and is therefore 

not eligible for establishment payments 

under § 1450.212 may be eligible for 

annual payments under the provisions 

of this section. 

(e) In the case of a contract 

succession, annual payments will be 

divided between the predecessor and 

the successor participants as agreed to 

among the participants and approved by 

CCC. If there is no agreement among the 

participants, annual payments will be 

divided in such manner deemed 

appropriate by the Deputy 

Administrator and such distribution 

may be prorated based on the actual 

days of ownership of the property by 

each party. 

(f) Annual payments will be reduced, 

as determined by CCC: 

(1) By a percentage of the sum of the 

sale price and payments under subpart 

B of this part for the crop collected or 

harvested from the contract acreage as 

follows: 

(i) By 1 percent if the eligible crop is 

delivered to a biomass conversion 

facility for conversion to cellulosic 

biofuels as defined by 40 CFR 80.1401; 

(ii) By 10 percent if the eligible crop 

is delivered to a biomass conversion 

facility for conversion to advanced 

biofuels; 

(iii) By 25 percent if the eligible crop 

is delivered to a biomass conversion 

facility for conversion to heat, power, or 

biobased products; 

(iv) By 100 percent if the eligible crop 

is used for a purpose other than 

conversion to heat, power, biobased 

products, or advanced biofuels; 

(2) If the producer violates a term of 

the contract; or 

(3) In other circumstances deemed 

necessary or appropriate to carry out 

BCAP. 

§ 1450.215 Transfer of land. 

(a)(1) If a new owner or operator 

purchases or obtains the right and 

interest in, or right to occupancy of, 

land subject to a BCAP contract, such 

new owner or operator, upon the 

approval of CCC, may become a 

participant to a new BCAP contract with 

CCC for the transferred land. 

(2) For the transferred land, if the new 

owner or operator becomes a successor 

to the existing BCAP contract, the new 

owner or operator will assume all 

obligations of the BCAP contract of the 

previous participant. 

(3) If the new owner or operator is 

approved as a successor to a BCAP 

contract with CCC, then, except as 

otherwise determined by the Deputy 

Administrator: 


srobinson on DSKHWCL6B1PROD with RULES2
Federal Register / Vol. 75, No. 207 / Wednesday, October 27, 2010 / Rules and Regulations 66243 

(i) Establishment payments will be 

made to the past or present participant 

who established the practice; and 

(ii) Annual payments to be paid 

during the fiscal year when the land was 

transferred will be divided between the 

new participant and the previous 

participant in the manner specified in 

§ 1450.214(c). 

(b) If a participant transfers all or part 

of the right and interest in, or right to 

occupancy of, land subject to a BCAP 

contract and the new owner or operator 

does not become a successor to such 

contract within 60 days of such transfer, 

or such other time as CCC determines to 

be appropriate, such contract will be 

terminated with respect to the affected 

portion of such land, and the original 

participant: 

(1) Forfeits all rights to any future 

payments for that acreage; 

(2) Must refund all previous payments 

received under the contract by the 

participant or prior participants, plus 

interest, except as otherwise specified 

by CCC. The provisions of § 1450.211(g) 

will apply. 

(c) Federal agencies acquiring 

property, by foreclosure or otherwise, 

that contains BCAP contract acreage 

cannot be a party to the contract by 

succession. However, through an 

addendum to the contract, if the current 

operator of the property is one of the 

contract participants, the contract may 

remain in effect and, as permitted by 

CCC, such operator may continue to 

receive payments under such contract if 

CCC determines that such allowance is 

in the public interest and: 

(1) The property is maintained in 

accordance with the terms of the 

contract; 

(2) Such operator continues to be the 

operator of the property; and 

(3) Ownership of the property remains 

with such Federal agency. 

Signed at Washington, DC, on October 19, 

2010. 

Jonathan W. Coppess, 

Executive Vice President, Commodity Credit 

Corporation. 

[FR Doc. 2010–26871 Filed 10–22–10; 11:15 am] 

BILLING CODE 3410–05–P 


srobinson on DSKHWCL6B1PROD with RULES2