[Federal Register Volume 65, Number 26 (Tuesday, February 8, 2000)]
[Rules and Regulations]
[Pages 5993-5998]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-2822]



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Rules and Regulations
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Federal Register / Vol. 65, No. 26 / Tuesday, February 8, 2000 / 
Rules and Regulations

[[Page 5993]]



DEPARTMENT OF AGRICULTURE

Cooperative State Research, Education, and Extension Service

7 CFR Part 3418

RIN 0524-AA23


Stakeholder Input Requirements for Recipients of Agricultural 
Research, Education, and Extension Formula Funds

AGENCY:  Cooperative State Research, Education, and Extension Service, 
USDA.

ACTION:  Final rule.

-----------------------------------------------------------------------

SUMMARY:  The Cooperative State Research, Education, and Extension 
Service (CSREES) adds new regulations for the purpose of implementing 
section 102(c) of the Agricultural Research, Extension, and Education 
Reform Act of 1998 (AREERA) (7 U.S.C. 7612(c)) which requires 1862 
land-grant institutions, 1890 land-grant institutions, and 1994 land-
grant institutions that receive agricultural research, extension, or 
education formula funds to establish a process for stakeholder input on 
the uses of such funds. Failure to comply with these stakeholder input 
requirements may result in the withholding of a recipient institution's 
formula funds and redistribution of its share of formula funds to other 
eligible institutions.

EFFECTIVE DATE:  February 8, 2000.

FOR FURTHER INFORMATION CONTACT:  Dr. Sally Rockey; Deputy 
Administrator, Competitive Research Grants and Awards Management; 
Cooperative State Research, Education, and Extension Service; U.S. 
Department of Agriculture; Mail Stop 2240; 1400 Independence Avenue, 
SW; Washington, DC 20250-2240; at 202-401-1761, or via electronic mail 
at <a href="/cdn-cgi/l/email-protection#ddaeafb2beb6b8a49dafb8b8a8aeb9bcf3bab2ab"><span class="__cf_email__" data-cfemail="c4b7b6aba7afa1bd84b6a1a1b1b7a0a5eaa3abb2">[email protected]</span></a>.

SUPPLEMENTARY INFORMATION:

Background and Purpose

    The Cooperative State Research, Education, and Extension Service 
(CSREES) adds this rule to implement section 102(c) of the Agricultural 
Research, Extension, and Education Reform Act of 1998 (AREERA) (7 
U.S.C. 7612(c)) which requires 1862, 1890, and 1994 institutions 
(specific land-grant colleges and universities as defined by section 2 
of AREERA (7 U.S.C. 7601)) receiving agricultural research, extension, 
or education formula funds from CSREES to establish a process for 
receiving input from persons who conduct or use agricultural research, 
extension, or education on the uses of such funds. For purposes of this 
rule, these persons are referred to as stakeholders. Section 102(c)(2) 
of AREERA required the Secretary of Agriculture to promulgate 
regulations specifying what those land-grant institutions had to do to 
meet this stakeholder input requirement, and what consequences would 
befall any institution that did not meet such a requirement.
    Section 102(c) on its face only applies to land-grant colleges and 
universities established pursuant to the First Morrill Act, as amended 
(7 U.S.C. 301, et seq.) (1862 institutions), the Second Morrill Act, as 
amended (7 U.S.C. 321, et seq.) (1890 institutions), and the Equity in 
Educational Land-Grant Status Act of 1994, as amended (7 U.S.C. 301 
note) (1994 institutions). CSREES has determined that the formula funds 
specified in section 102(c) are: Agricultural research funds provided 
to the 1862 institutions and agricultural experiment stations under the 
Hatch Act of 1887, as amended (7 U.S.C. 361a, et seq.); extension funds 
provided to 1862 institutions under sections 3(b) and 3(c) of the 
Smith-Lever Act, as amended (7 U.S.C. 343(b) and (c)), and section 
208(c) of the District of Columbia Public Postsecondary Education 
Reorganization Act, Pub. L. 93-471, as amended; agricultural research 
and extension funds provided to 1890 institutions under sections 1444 
and 1445, respectively, of the National Agricultural Research, 
Extension, and Teaching Policy Act of 1977 (NARETPA), as amended (7 
U.S.C. 3221 and 3222); education formula funds provided to 1994 
institutions under section 534(a) of the Equity in Educational Land-
Grant Status Act of 1994 (7 U.S.C. 301 note); research funds provided 
for forestry schools under the McIntire-Stennis Act of 1962, as amended 
(16 U.S.C. 582a, et seq.); and animal health and disease research funds 
provided to veterinary schools and agricultural experiment stations 
under section 1433 of NARETPA, as amended (7 U.S.C. 3195).
    The 1862, 1890, and 1994 institutions are not the sole institutions 
eligible to receive formula funds under all of these Acts. There is one 
agricultural experiment station that is not a college or university, 
and twelve forestry or veterinary schools that are not land-grant 
institutions. However, given that the number of such institutions is de 
minimus, and the impracticality of trying to segregate stakeholder 
comments with respect to these few institutions, CSREES has determined 
to apply this rule to any recipient of the aforementioned formula 
funds.
    The rule does not require recipient institutions to adopt any 
particular format for soliciting stakeholder input. It only requires 
that recipient institutions report annually to CSREES (1) the actions 
taken to encourage stakeholder input; (2) a brief statement of the 
process used by a recipient institution to identify individuals or 
groups as stakeholders and to collect input from them; and (3) a 
statement of how collected input was considered.
    Failure to comply with the requirements of this rule may result in 
the withholding of a recipient institution's formula funds and 
redistribution of its share of formula funds to other eligible 
institutions, as authorized by law.

Public Comments and Changes to the Final Rule

Summary of Statutory Changes

    CSREES has added the definition of seek stakeholder input to the 
Final Rule. This definition has already been included in the Final 
Guidelines for State Plans of Work for the Agricultural Research and 
Extension Formula Funds that was published in the Federal Register on 
July 1, 1999, 62 FR 35910-35919.
    CSREES revised Sec. 3418.4, Reporting Requirement, by adding a 
third reporting requirement as follows: ``(3) a statement of how 
collected input was considered.'' The third and final revision was to 
change the title of

[[Page 5994]]

Sec. 3418.5, from ``Failure to Report'' to ``Failure to Comply and 
Report.''
    CSREES also will be conducting an evaluation of how the stakeholder 
input requirements in section 102(c) of AREERA are being implemented by 
both CSREES and the affected colleges and universities after a 2-year 
implementation period. Part of this evaluation will be to determine 
whether this Final Rule will need to be revised.

Background

    CSREES developed the proposed rule for stakeholder input 
requirements in consultation with the State partners at the 1862 and 
1890 land-grant institutions. Since the enactment of AREERA on June 23, 
1998, CSREES has engaged in these consultations under an exemption to 
the Federal Advisory Committee Act (7 U.S.C. 3124a(e)), with members of 
the Federal and State partnership, not only on this rule, but on other 
aspects of implementation of AREERA requirements including the 
Guidelines for State Plans of Work for Agricultural Research and 
Extension Formula Funds. This consultation process was consistent with 
the consultation process required by Executive Order 13132, Federalism, 
issued by the President on August 4, 1999 (64 FR 43255).
    The proposed rule for stakeholder input requirements was published 
in the Federal Register on April 14, 1999, 64 FR 18534-18536, with a 
30-day comment period. The proposed rule did not require recipient 
institutions to adopt any particular format for soliciting stakeholder 
input. It only required that recipient institutions report annually to 
CSREES (1) the actions taken to encourage stakeholder input; and (2) a 
brief statement of the process used by the recipient institution to 
identify individuals or groups as stakeholders and to collect input 
from them.
    In the preamble to the proposed rule, CSREES encouraged interested 
parties to review the Proposed Guidelines for State Plans of Work which 
were published in the Federal Register for a 30-day comment period on 
April 19, 1999, 64 FR 19242-19248. The Proposed Guidelines for State 
Plans of Work explained in greater detail the stakeholder input 
requirements, especially how they relate to the development of the 5-
Year Plans of Work. These 5-Year Plans of Work include the reporting 
requirement on the stakeholder input process for the 1862 and 1890 
land-grant institutions and these plans apply to the agricultural 
research and extension formula funds received under the Hatch Act of 
1887, sections 3(b) and 3(c) of the Smith-Lever Act, and under sections 
1444 and 1445 of NARETPA. These Proposed Guidelines for State Plans of 
Work did not apply to the agricultural education formula funds received 
by the 1994 land-grant institutions or to the research or extension 
formula funds received by colleges and universities under section 3(d) 
of the Smith-Lever Act, the McIntire-Stennis Act of 1962 for 
cooperative forestry research, and section 1433 of NARETPA for animal 
health and disease research.
    The 1862 and 1890 land-grant institutions will fulfill their annual 
reporting requirement on the stakeholder input process via the Annual 
Report of Accomplishments and Results as outlined in the Final 
Guidelines for State Plans of Work. The reports on the stakeholder 
input process for the 1994 land-grant institutions will be required as 
part of their Tribal College Education Equity Grant proposals and their 
stakeholder input processes will be reviewed at the time these grant 
proposals are evaluated. The recipients of the Smith-Lever Act (section 
3(d)) formula funds, McIntire-Stennis Cooperative Forestry Research 
funds, and the Animal Health and Disease Research funds will be 
required to submit an annual report on their stakeholder input 
processes prior to the distribution of formula funds each fiscal year. 
This report will be reviewed by the appropriate program official to 
determine whether the stakeholder input requirements have been met.

Impact of Comments on the Related Final Guidelines for State Plans of 
Work on This Rule

    Two comments were received on the Proposed Guidelines for State 
Plans of Work published in the Federal Register on April 19, 1999, 64 
FR 19242-19248, regarding the stakeholder input process. One of the 
commenters supported the decision of CSREES to provide the maximum 
flexibility to institutions in the way they report their stakeholder 
input in their plans of work. The other commenter focused on the 
definition of seek stakeholder input. The notice of the Proposed 
Guidelines defined seek stakeholder input as ``means an open and fair 
process which allows opportunities for individuals, groups, and 
organizations a voice in a process that treats all with dignity and 
respect.'' This commenter urged CSREES to adopt a new definition, 
building upon the concepts of ``open and fair,'' ``equality of 
service,'' and ``ease of access'' in the Final Guidelines, as follows: 
``Seek stakeholder input means an open, fair, transparent, accessible, 
inclusive, accountable, and comprehensive process which provides 
opportunities for diverse individuals, groups, and organizations, 
especially the traditionally under-served and under-represented, to 
have a voice in a process that treats all with dignity and respect.''
    CSREES modified the definition of seek stakeholder input to ``Seek 
stakeholder input means an open, fair, and accessible process by which 
individuals, groups, and organizations may have a voice and one that 
treats all with dignity and respect.'' However, although CSREES did 
encourage States to implement a stakeholder input process satisfying 
the above definition posed by the commenter, CSREES recognized in 
consultation with the State partners that each State or Tribe has 
unique characteristics and should implement a stakeholder input process 
that best suits the needs of their State or Tribe. CSREES had 
determined to use this modified definition of seek stakeholder input as 
the lowest acceptable threshold of stakeholder input process because 
CSREES wants to maintain an environment in which land-grant 
institutions may quickly modify their stakeholder input processes to 
respond effectively to existing and emerging critical agricultural 
issues. Also, CSREES did not want to place undue administrative burdens 
upon the land-grant institutions in meeting the stakeholder input 
requirements that potentially may interfere with the conduct and 
delivery of research and extension programs. This determination by 
CSREES is consistent with the policies set forth in Executive Order 
13132, Federalism.
    The above commenter made three additional comments. First, the 
commenter noted that while the definition for under-served is 
referenced once in the review criteria, the definition of under-
represented did not appear in the Proposed Guidelines. As the commenter 
had thought, this was an oversight and had been included in the review 
criteria. Second, this commenter thought CSREES should address under-
served and under-represented in the target audiences section under 
``Program Descriptions.'' Third, the commenter urged CSREES to broaden 
the definition of under-represented to specifically include ``small 
farm owners and operators.'' CSREES revised the Guidelines to 
incorporate these last two suggestions.
    The Final Guidelines for State Plans of Work were published prior 
to this Final Rule on stakeholder input requirements due to the urgency 
of the plans of work being received, reviewed, and approved prior to 
October 1, 1999,

[[Page 5995]]

to prevent any disruption in the delivery of research and extension 
programs. However, 1862 and 1890 land-grant institutions are required 
to comply with any additional requirements as set forth in this Final 
Rule.

Comments on the Proposed Stakeholder Input Requirements Rule

    Eighty-nine comments were received. Eighty-four were received from 
individuals and stakeholder groups; four from deans or directors at the 
1862 land-grant institutions; and one from the USDA Office of Inspector 
General (OIG).
A. Individuals and Stakeholder Groups
    Sixty of the 84 comments received from individuals and stakeholder 
groups wrote that the proposed rule in the April 14, 1999, Federal 
Register did not provide adequate guidance as to what constitutes a 
reasonable and adequate stakeholder input process. These commenters 
felt that by not establishing minimal criteria for a satisfactory and 
adequate stakeholder input process, the proposed rule did not address 
the Congressional concern for increased accountability within the land-
grant system. CSREES has included in this Final Rule the definition of 
seek stakeholder input which requires that a stakeholder input process 
be fair, open, and accessible. This definition was originally included 
in the Proposed Guidelines for State Plans of Work and had been 
developed in consultation with the 1862 and 1890 land-grant community. 
Failure to include the definition in the Proposed Rule for stakeholder 
input requirements was an oversight on the part of CSREES.
    Sixty-two commenters felt that while it is not USDA's role to 
dictate the particular style or format for stakeholder input process, 
it is vitally important for USDA to ensure that every stakeholder 
process meet certain minimal public accountability standards. 
Generally, all of these commenters felt that these public 
accountability standards should include:
    Fairness: Basic fairness requires equal access to the process by 
all citizens and taxpayers.
    Transparency: All aspects of the stakeholder process should be in 
the open and on public record.
    Accountability: Those who take the time and effort to provide input 
and recommendations should be given the courtesy of reviewing the 
written record of any meeting they participated in for accuracy as well 
as some type of timely reporting as to how the stakeholder input was 
utilized, and if specific recommendations were rejected, the reasons 
why.
    Balanced Representation: Each institution should be required to 
demonstrate a good faith effort to solicit input from, and active 
engagement with, traditionally under-served and under-represented 
constituencies (e.g., the full range of farmers and ranchers).
    Comprehensive and Meaningful Role: Stakeholder input should be 
sought on a variety of different levels, including but not limited to:
    <bullet> Advice on priority setting and program development;
    <bullet> Input on both immediate needs and long-term goals;
    <bullet> Participation in relevancy and portfolio reviews;
    <bullet> Guidance on monitoring, evaluation, and oversight systems 
employed to track performance and results; and
    <bullet> Counsel on emerging technologies and recommendations for 
public education and discussion about the mission and directions of the 
institution.
    The Rule applies not only to the 1862 land-grant institutions, but 
to the 1890 and 1994 land-grant institutions as well as to colleges and 
universities that are not land-grant institutions, but receive 
agricultural research, education, and extension formula funds. The 1994 
land-grant institutions just started to receive formula funds from 
CSREES in fiscal year 1996, and the amount of funding per institution 
is very limited. For the non-land-grant institutions, funding is for a 
very specific purpose. In addition, there are other new AREERA 
requirements for the land-grant institutions in addition to section 
102(c), such as the submission and approval of plans of work prior to 
the distribution of formula funds on October 1, 1999, and the 
establishment of either a merit review process or a scientific peer 
review process prior to October 1, 1999. Therefore, CSREES has 
determined at this time to require at the minimum a stakeholder input 
process that is fair, open, and accessible.
    Representation was a particular concern to 34 commenters as 
summarized by one of the commenters: ``I believe that the original 
intent of Congress when this Act was passed was to ensure that land-
grant institutions are acknowledging their accountability to a larger 
public and simply not to the traditional land-grant stakeholders. * * * 
Rather than giving up on stakeholder processes, I believe the land-
grants must be encouraged to embrace multiple approaches and to 
specifically seek out the views of those who are seldom heard in the 
land-grants such as the full range of farmers and ranchers.* * *''
    As mentioned previously, minimal public accountability standards 
now include a fair, open, and accessible process. Although this Final 
Rule may not impose all of the public accountability standards desired 
by the commenters, this will be a new major requirement for many 
institutions; and it is anticipated that to meet this requirement, 
institutions will provide more opportunities for stakeholder input. As 
evident through some of the 5-year Plans of Work received, institutions 
are establishing processes that are more inclusive, more accessible, 
and reach beyond their traditional audiences. The concept of balanced 
representation also is incorporated in the Final Guidelines for State 
Plans of Work for the 1862 and 1890 land-grant institutions through 
plan of work reporting requirements and evaluation criteria that 
address giving attention to under-served and under-represented 
audiences.
    Nine commenters felt that the land-grant institutions tended to 
serve the needs of agribusiness over the needs of the public good, and 
seven commenters criticized USDA for only requiring an annual report 
from the land-grant institutions. Eighteen commenters charged CSREES, 
by publishing the proposed rule, with ``business as usual'' at the 
land-grant institutions or supporting the ``status quo,'' and thought 
that very little would change at the land-grant institutions. Two 
commenters felt that USDA was being pressured by the land-grant 
institutions to adopt the proposed rule.
    CSREES does not agree that the land-grant institutions tend to 
serve the needs of agribusiness over the needs of the public but rather 
focus on meeting the needs of the public at large through the delivery 
of a wide range of agricultural research, education, and extension 
programs. In addition, many of the land-grant institutions have 
modified their stakeholder input processes to extend beyond the 
traditional advisory groups. Although it may appear that CSREES is only 
requiring an annual report on the stakeholder input process, CSREES has 
evaluated the 5-Year Plans of Work (FY 2000-FY 2004) and will continue 
to evaluate plans of work by reviewing the stakeholder input process 
and determining whether the input gathered during the process has been 
considered in developing the plan of work. By reviewing the plans of 
work in this context, CSREES is not conducting ``business as usual'' 
with the land-grant institutions.

[[Page 5996]]

    Four comments were received that suggested this was an opportunity 
for USDA ``to submit a new proposed rule for comment which will offer 
substantive, `broad parameters and guidelines' for stakeholder input as 
called for by the legislative language and history * * *. The `broad 
parameters and guidelines' which CSREES is required to propose should 
take the form of general performance goal-statements for land-grant 
institutions' stakeholder input processes. Institutions, in turn, must 
be required to report their methods, plans and progress in meeting 
these performance goals.''
    By including the minimal standards of fairness, openness, and 
accessibility for stakeholder input processes, CSREES is establishing 
broad criteria to which performance goals can be established and 
outcomes and impacts measured. By requiring institutions to report on 
how the stakeholder input was considered, CSREES is ensuring that 
agricultural research and extension programs conducted are indeed a 
priority and are relevant to the critical agricultural issues in the 
States.
    Seven commenters viewed the implementation of the stakeholder input 
requirement as an opportunity for the land-grant system to reinvigorate 
itself and to improve citizen estimation of them. One commenter stated: 
``A stakeholder input process that is inclusive, fair, comprehensive, 
and open should be viewed as an opportunity for the land-grant 
institution to demonstrate its relevance to the people of the State who 
support it * * *.''
    CSREES does see the implementation of section 102(c) of AREERA for 
stakeholder input requirements as an opportunity for the land-grant 
system to make the public more aware of the existence and availability 
of agricultural research, education, and extension programs; reach new 
audiences; and deliver agricultural research, education, and extension 
programs more efficiently and effectively through multistate, 
multidisciplinary, and multi-institutional activities as well as 
integrated research and extension activities.
    Ten commenters noted the range of stakeholder input processes in 
the States. They cited examples of processes that were successful as 
well as those they thought required improvement. Since CSREES is aware 
of the wide range of stakeholder input processes at the affected 
institutions, CSREES thought it prudent to establish minimal standards 
through the definition of seek stakeholder input for all affected 
institutions, including the 1994 land-grant institutions and colleges 
and universities that are not land-grant institutions. And since the 
State Plans of Work for the 1862 and 1890 land-grant institutions 
encompass a significant portion of the Federal formula funds dedicated 
to agricultural research and extension (approximately $500 million) and 
support a broad range of agricultural research, education, and 
extension programs, the Final Guidelines for State Plans of Work 
require that efforts be made to address traditionally under-served and 
under-represented audiences.
    Three commenters suggested that there be a full array of methods to 
solicit stakeholder input including small groups, large groups with 
formal testimony, conventional and electronic contacts, posters at 
public institutions, and public service announcements on radio and 
television. CSREES expects that a broad range of methods will be used 
to solicit input from stakeholders as the definition of seek 
stakeholder input includes ``accessible,'' but does not feel it is 
necessary to dictate any specific method to be used.
    Two commenters referred to earlier drafts of the proposed rule as 
follows: ``Earlier draft versions of the proposed rule, while far from 
adequate, at least made reference to the necessity of an open and fair 
process, encouraging participation of diverse individuals and groups, 
and demonstrating that stakeholder input was actually considered * * 
*.'' CSREES assumes that these commenters were referring to the 
references in the Proposed Guidelines for State Plans of Work which 
included the definitions of seek stakeholder input, under-represented, 
and under-served as well as the evaluation criteria addressing the 
involvement of stakeholders in the planning process and the attention 
given to under-served and under-represented populations. Hence, CSREES 
has added the definition of seek stakeholder input to the Final Rule.
    Four comments were received suggesting that the annual reporting 
requirement be changed to reporting on the actions taken and plans to 
meet the five public accountability standards identified above by 
sixty-two commenters as well as an assessment of the progress made 
towards fulfilling each of these public accountability standards. Two 
of the commenters suggested that the existing language in Sec. 3418.4 
be amended to refer not only to processes to ``collect'' input but also 
to utilize it, or in the words of the statute ``solicit and consider 
input and recommendations.'' CSREES has adopted the commenter's 
suggestion by adding the third reporting requirement under Sec. 3418.4, 
Reporting Requirement, as follows: ``(3) a statement of how collected 
input was considered.''
    Two comments were received that suggested that the title of 
Sec. 3418.5, Failure to Report, be revised to include language about 
failure to comply. CSREES has revised the title of the section as 
suggested by the commenter to ``Failure to Comply and Report.''
    Forty-four commenters felt that CSREES needed to either amend the 
proposed rule or rewrite the rule and hold another public comment 
period based on the above comments. CSREES has made three revisions to 
the Proposed Rule based on the comments received. Based on both the 
content and the number of comments received, CSREES will be conducting 
an evaluation of implementation of section 102(c) of AREERA by CSREES 
and the affected institutions after a 2-year implementation period. 
This should provide sufficient time for the affected institutions to 
implement a stakeholder input process based on the Final Rule.
B. Land-Grant Institutions
    As mentioned previously, four comments were received from deans or 
directors at the 1862 land-grant institutions. Two of these commenters 
felt that the proposed rule as published in the Federal Register was 
adequate. However, one of these commenters thought that meeting the 
public accountability standards should be strongly encouraged rather 
than specifically spelled out in the rules. The other commenter was 
pleased that the proposed rule provided flexibility and noted: ``States 
are unique in the organizations, structures and processes available in 
their area. Given the diversity among States it is important to provide 
flexibility so that each State can optimize stakeholder input in their 
State.'' As stated previously, CSREES agrees that all stakeholder input 
processes should be fair, open, and accessible.
    One of the commenters stated that there should be maximum 
transparency and accountability while keeping the administrative costs 
to a minimum. The commenter continued by stating that AREERA reporting 
requirements diverted significant resources from the delivery of 
programs to administrative functions and that any additional 
requirements would place an unreasonable burden on the agricultural 
experiment stations. These comments were considered in establishing the 
minimum criteria for stakeholder input processes. Another commenter was

[[Page 5997]]

concerned that while the requirements for stakeholder participation can 
be accommodated by the land-grant institution, they are concerned about 
situations in which an individual or stakeholder group may proclaim 
stakeholder ``rights'' and proclaim that ``no opportunity'' was given 
to provide input. CSREES feels that stakeholders should be given 
reasonable opportunity to provide input and that issues such as this 
one may be addressed during the evaluation of the entire process.
    One commenter noted that the clientele of the land-grant system is 
highly diverse with multiple and broad ranging needs and that it is 
recognized that resources will simply not be adequate to address all 
identified needs. Although CSREES agrees with this statement, CSREES 
feels that this is the primary reason for implementing and maintaining 
an adequate stakeholder input process. If resources were unlimited, 
there would be no need for priority setting processes which include 
soliciting and considering stakeholder input.
    Another commenter wanted to know why the stakeholder input process 
only applied to the agricultural research and extension Federal formula 
funds and not all the funds supporting agricultural research and 
extension. Section 102(c) of AREERA only applies to agricultural 
research, education, and extension formula funds from CSREES.
C. USDA Office of Inspector General
    The comment from the USDA Office of Inspector General (OIG) 
concentrated on three issues: Performance indicators identified in 
section 102(d) of AREERA, lack of criteria, and the recommendation that 
CSREES review the descriptions of the stakeholder input processes to 
assess the institutions' compliance.
    The OIG commented ``that the performance indicators prescribed by 
Congress as the `management principles' of the priority setting process 
must be ensured by targeting stakeholders who can achieve this goal and 
setting priorities for research, education, or extension activities 
that meet these performance criteria.'' The OIG continued by stating 
that they found no reference in the Proposed Rule to the performance 
indicators listed in section 102(d) of AREERA and that they consider 
the indicators to be critical controls over the outcome of the 
recipients' solicitation process.
    Section 102(d)of AREERA states that the Secretary shall ensure that 
federally supported and conducted agricultural research, extension, and 
education activities are accomplished in a manner that (1) integrates 
agricultural research, extension, and education functions to better 
link research to technology transfer and information dissemination 
activities; (2) encourages regional and multistate programs to address 
relevant issues of common concern and to better leverage scarce 
resources; and (3) achieves agricultural research, extension, and 
education objectives through multi-institutional and multifunctional 
approaches and by conducting research at facilities and institutions 
best suited to serve those objectives. CSREES accomplished this task in 
the establishment of the Final Guidelines for State Plans of Work for 
Agricultural Research and Extension Formula Funds with evaluation 
criteria addressing these ``management principles'' and the development 
of requests for proposals which includes evaluation criteria for 
competitive research, education, and extension grant programs. Section 
102(d) is the responsibility of CSREES and is evident in how CSREES 
establishes evaluation criteria and how they administer both the 
formula and competitive grant programs. It would defeat the whole 
purpose of the stakeholder input process if section 102(d) of AREERA 
was applied to the stakeholders themselves.
    As mentioned previously, CSREES plans to conduct an evaluation of 
implementation of section 102(c) of AREERA by CSREES and the affected 
institutions after a 2-year implementation period to determine both the 
adequacy of the stakeholder input processes in priority setting and the 
effectiveness of this Final Rule. Through the inclusion of the 
definition for seek stakeholder input in the Final Rule, CSREES has 
adopted the minimum standards or criteria for a stakeholder input 
process as being fair, open, and accessible.

Estimated Burden Hours on the Information Collection

    The estimated burden hours per response for the information 
collection associated with the Final Rule was revised from the original 
estimate of 9.19 hours to 57.32 hours per response. This estimate was 
revised after the Office of Management and Budget questioned whether 
9.19 hours were sufficient to report not only on the stakeholder input 
process but on the actual consideration of input and recommendations 
from stakeholders concerning the use of formula funds.
    The estimate for the original burden hours was calculated at 9.19 
hours and based mainly on preparing an annual report describing actions 
taken to seek stakeholder input that encourages their participation and 
a brief statement of the process used by the recipient institutions to 
identify individuals and groups who are stakeholders and to collect 
input from them. The increase to 57.32 hours per response, or an 
additional 48.13 hours per response, is attributed to the requirement 
under Sec. 3418.4 relating to how the collected input was considered. 
It is estimated that it will take 24.5 hours to review the stakeholder 
input gathered, 23.63 hours to determine whether the priorities for 
agricultural research, extension, and education activities conducted by 
the institution need to be adjusted, and 9.19 hours to write and edit 
the annual report.

Classification

    This rule has been reviewed under Executive Order 12866 and has 
been determined to be non-significant as it will not create a serious 
inconsistency or otherwise interfere with an action planned by another 
agency; will not materially alter the budgetary impact of entitlement, 
grants, user fees, or loan programs, or the rights and obligations of 
the recipients thereof; and will not raise novel legal or policy issues 
arising out of legal mandates, the President's priorities, or 
principles set forth in this executive order. This rule also will not 
have an annual effect on the economy of $100 million or more or 
adversely affect in a material way the economy, a sector of the 
economy, productivity, competition, jobs, the environment, public 
health or safety, or State, local, or tribal governments or 
communities.

Regulatory Flexibility Act

    The Department certifies that this rule will not have a significant 
impact on a substantial number of small entities as defined in the 
Regulatory Flexibility Act, Pub. L. No. 96-534 (5 U.S.C. 601 et seq.). 
Accordingly, a regulatory flexibility analysis is not required for this 
proposed rule.

Catalog of Federal Domestic Assistance

    The programs affected by this rule are listed in the Catalog of 
Federal Domestic Assistance under No. 10.203, Payments to Agricultural 
Experiment Stations Under the Hatch Act, No. 10.205, Payments to 1890 
Land-Grant Colleges and Tuskegee University, No. 10.202, Cooperative 
Forestry Research, No. 10.207, Animal Health and Disease Research, No. 
10.500, Cooperative Extension Service, and No. 10.221, Tribal Colleges 
Education Equity Grants.

Paperwork Reduction Act

    Under the provisions of the paperwork Reduction Act of 1995, as

[[Page 5998]]

amended (44 U.S.C. Chapter 35), the collection of information 
requirements contained in this Final Rule have been reviewed and 
approved by the Office of Management and Budget (OMB) and given OMB 
Document No. 0524-0035. Under the Paperwork Reduction Act of 1995, no 
person is required to respond to a collection of information unless it 
displays a valid OMB control number.
    The public reporting burden for this collection of information 
contained in this rule is estimated at 57.32 hours per response. This 
includes the time for reviewing instructions, searching existing data 
sources, gathering and maintaining the data needed, and completing and 
reviewing the collection of information. Please send comments regarding 
this burden estimate or any other aspect of this collection of 
information, including suggestions for reducing this burden, to the 
Department of Agriculture, Clearance Officer, Office of the Chief 
Information Officer, Stop 7603, 1400 Independence Avenue, SW., 
Washington, DC 20250-7603, and to the Office of Management and Budget, 
Paperwork Reduction Project, Washington, DC 20503. This rule has no 
additional impact on any existing data collection burden.

Report to Congress

    As required by 5 U.S.C. 801(a), CSREES submitted a report on this 
final rule to both houses of Congress and the Comptroller General prior 
to publication.

List of Subjects in 7 CFR part 3418

    Agricultural education, Agricultural extension, Agricultural 
research, Colleges and universities.

    For reasons stated in the preamble, chapter XXXIV of Title 7 of the 
Code of Federal Regulations is amended by adding Part 3418 to read as 
follows:

PART 3418--STAKEHOLDER INPUT REQUIREMENTS FOR RECIPIENTS OF 
AGRICULTURAL RESEARCH, EDUCATION, AND EXTENSION FORMULA FUNDS

Sec.
3418.1   Definitions.
3418.2   Scope and purpose.
3418.3   Applicability.
3418.4   Reporting requirement.
3418.5   Failure to comply and report.
3418.6   Prohibition.

    Authority:  5 U.S.C. 301; 7 U.S.C. 7612(c)(2).


Sec. 3418.1  Definitions.

    As used in this part:
    1862 institution means a college or university eligible to receive 
funds under the Act of July 2, 1862 (7 U.S.C. 301, et seq.).
    1890 institution means a college or university eligible to receive 
funds under the Act of August 30, 1890 (7 U.S.C. 321, et seq.), 
including Tuskegee University.
    1994 institution means an institution as defined in section 532 of 
the Equity in Educational Land-Grant Status Act of 1994 (7 U.S.C. 301 
note).
    Formula funds means agricultural research funds provided to 1862 
institutions and agricultural experiment stations under the Hatch Act 
of 1887 (7 U.S.C. 361a, et seq.); extension funds provided to 1862 
institutions under sections 3(b) and 3(c) of the Smith-Lever Act (7 
U.S.C. 343(b) and (c)) and section 208(c) of the District of Columbia 
Public Postsecondary Education Reorganization Act, Pub. L. 93-471; 
agricultural extension and research funds provided to 1890 institutions 
under sections 1444 and 1445 of the National Agricultural Research, 
Extension, and Teaching Policy Act of 1977 (NARETPA)(7 U.S.C. 3221 and 
3222); education formula funds provided to 1994 institutions under 
section 534(a) of the Equity in Educational Land-Grant Status Act of 
1994 (7 U.S.C. 301 note); research funds provided to forestry schools 
under the McIntire-Stennis Act of 1962 (16 U.S.C. 582a, et seq.); and 
animal health and disease research funds provided to veterinary schools 
and agricultural experiment stations under section 1433 of NARETPA (7 
U.S.C. 3195).
    Recipient institution means any 1862 institution, 1890 institution, 
1994 institution, or any other institution that receives formula funds 
from the Department of Agriculture.
    Seek stakeholder input means an open, fair, and accessible process 
by which individuals, groups, and organizations may have a voice, and 
one that treats all with dignity and respect.
    Stakeholder means any person who has the opportunity to use or 
conduct agricultural research, extension, or education activities of 
recipient institutions.


Sec. 3418.2  Scope and Purpose.

    Section 102(c) of the Agricultural Research, Extension, and 
Education Reform Act of 1998 (7 U.S.C. 7612(c)) requires land-grant 
institutions, as a condition of receipt of formula funds, to solicit 
and consider input and recommendations from stakeholders concerning the 
use of formula funds. This regulation implements this requirement 
consistently for all recipient institutions that receive formula funds.


Sec. 3418.3  Applicability.

    To obtain formula funds after September 30, 1999, each recipient 
institution shall establish and implement a process for obtaining 
stakeholder input on the uses of formula funds in accordance with this 
part.


Sec. 3418.4  Reporting requirement.

    Each recipient institution shall report to the Department of 
Agriculture by October 1 of each fiscal year, the following information 
related to stakeholder input and recommendations:
    (a) Actions taken to seek stakeholder input that encourages their 
participation;
    (b) A brief statement of the process used by the recipient 
institution to identify individuals and groups who are stakeholders and 
to collect input from them; and
    (c) A statement of how collected input was considered.


Sec. 3418.5  Failure to comply and report.

    Formula funds may be withheld and redistributed if a recipient 
institution fails to either comply with Sec. 3418.3 or report under 
Sec. 3418.4.


Sec. 3418.6  Prohibition.

    A recipient institution shall not require input from stakeholders 
as a condition of receiving the benefits of, or participating in, the 
agricultural research, education, or extension programs of the 
recipient institution.

    Done at Washington, DC, this 31st day of January, 2000.
I. Miley Gonzalez,
Under Secretary, Research, Education, and Economics.
[FR Doc. 00-2822 Filed 2-7-00; 8:45 am]
BILLING CODE 3410-22-P


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