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###### Department of Agriculture

###### Office of the Secretary 

# AGENCY:

Office of the Secretary, USDA. 

# ACTION:

Notice of determination.

# SUMMARY:

The Secretary of Agriculture has determined that all State cost-share payments made to individuals as part of a Brownfields Grant are made primarily for the purpose of restoring the environment. This determination is made in accordance with section 126 of the Internal Revenue Code of 1954, as amended (2 U.S.C. 126). The determination permits recipients of these cost-share payments to exclude them from gross income to the extent allowed by the Internal Revenue Service. 

# FOR FURTHER INFORMATION CONTACT:

Jason Scott, Development Consultant; Department of Commerce, Brownfields Grant Program, 201 West Washington Avenue, Madison, Wisconsin 53707-7970; or Mark W. Berkland, Director, Conservation Operations Division, USDA Natural Resources Conservation Service, Post Office Box 2890, Washington, DC 20013. 

# SUPPLEMENTARY INFORMATION:

Section 126 of the Internal Revenue Code of 1954, as amended (26 U.S.C. 126), provides that certain payments made to persons under State conservation programs may be excluded from the recipient's gross income for Federal income tax purposes, if the Secretary of Agriculture determines that payments are made “primarily for the purpose of conserving soil and water resources, protecting or restoring the environment, improving forests, or providing a habitat for wildlife.” The Secretary of Agriculture evaluates these conservation programs on the basis of criteria set forth in 7 CFR Part 14, and makes a “primary purpose” determination for the payments made under each program. Before there may be an exclusion, the Secretary of the Treasury must determine that payments made under these conservation programs do not substantially increase the annual income derived from the property benefited by the payments. 

## Procedural Matters 

The authorizing legislation, regulations, and operating procedures regarding the Wisconsin Department of Commerce's Brownfields Grant Program have been examined using the criteria set forth in 7 CFR Part 14. The Secretary of Agriculture has concluded that the cost-share payments made for the implementation of best management practices under this program are made primarily for the purpose of restoring the environment. 

A “Record of Decision, Wisconsin Department of Commerce's Brownfields Grant Program, Primary Purpose Determination for Federal Tax Purposes” has been prepared and is available upon request from Jason Scott; Program Director; Wisconsin Department of Commerce, Brownfields Grant Program, 5th floor, 201 West Washington Avenue, Post Office Box 7970, Madison, Wisconsin 53707-7970; or from Mark W. Berkland, Director, Conservation Operations Division, USDA Natural Resources Conservation Service; Post Office Box 2890, Washington, DC 20013. 

## Determination 

As required by section 126(b) of the Internal Revenue Code of 1954, as amended, I have examined the authorizing legislation, regulations, and operating procedures regarding the Wisconsin Department of Commerce's Brownfields Grant Program. In accordance with the criteria set out in 7 CFR Part 14, I have determined that all cost-share payments for the implementation of projects under the Brownfields Grant Program are primarily for the purpose of restoring the environment. Subject to further determination by the Secretary of the Treasury, this determination permits payment recipients to exclude from gross income, for Federal income tax purposes, all or part of such cost-share payments made under said program. 

Signed in Washington, DC on April 9, 2001. 

Ann M. Veneman, 

Secretary, United States Department of Agriculture. 

[FR Doc. 01-10295 Filed 4-25-01; 8:45 am] 

BILLING CODE 3410-16-P