[Federal Register Volume 75, Number 27 (Wednesday, February 10, 2010)]
[Rules and Regulations]
[Pages 6539-6553]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2010-2812]



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Rules and Regulations
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Federal Register / Vol. 75, No. 27 / Wednesday, February 10, 2010 / 
Rules and Regulations

[[Page 6539]]



DEPARTMENT OF AGRICULTURE

Natural Resources Conservation Service

7 CFR Part 625

RIN 0578-AA52


Healthy Forests Reserve Program

AGENCY: Natural Resources Conservation Service, United States 
Department of Agriculture.

ACTION: Final rule.

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

SUMMARY: This final rule amends Natural Resources Conservation Service 
(NRCS) regulations for the Healthy Forests Reserve Program (HFRP). The 
Food, Conservation, and Energy Act of 2008 (the 2008 Act) amended 
provisions of HFRP that changed the duration, type, and funding 
allocation of program agreements, and NRCS published a proposed rule 
for these changes on January 14, 2009. This final rule responds to the 
comments received on the proposed rule and amends NRCS regulations for 
HFRP to incorporate changes associated with enactment of the 2008 Act.

DATES: Effective Date: This rule is effective February 10, 2010.

FOR FURTHER INFORMATION CONTACT: John Glover, Branch Chief, Easement 
Programs Branch, Department of Agriculture, Natural Resources 
Conservation Service, 1400 Independence Avenue, SW., Room 6811 South 
Building, Washington, DC 20250; Telephone: (202) 720-5477; Fax: (202) 
720-9689. 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:

Regulatory Certifications

Executive Order 12866

    The Office of Management and Budget (OMB) determined that this 
final rule is not a significant regulatory action and a benefit cost 
assessment has not been undertaken.

Federal Crop Insurance Reform and Department of Agriculture 
Reorganization Act of 1994

    Pursuant to section 304 of the Federal Crop Insurance Reform Act of 
1994 (Pub. L. 103-354), the Department of Agriculture (USDA) classified 
this rule as non-major. Therefore, a risk analysis was not conducted.

Regulatory Flexibility Act

    NRCS has determined that the Regulatory Flexibility Act is not 
applicable to this final rule because NRCS is not required by 5 U.S.C. 
553, or any other provision of law, to publish a notice of proposed 
rulemaking with respect to the subject matter of this rule.

Small Business Regulatory Enforcement Fairness Act of 1996

    This final rule is not a major rule as defined by section 804 of 
the Small Business Regulatory Enforcement Fairness Act of 1996. This 
final rule will not result in an annual effect on the economy of $100 
million or more, a major increase in costs or prices, or significant 
adverse effects on competition, employment, investment, productivity, 
innovation, or the ability of United States-based companies to compete 
in domestic and export markets.

Environmental Analysis

    The final rule for the HFRP amends the current regulation to 
include congressionally required statutory changes to the program as a 
result of the 2008 Act, Public Law 110-246. The 2008 Act changes the 
use of 30-year tribal contracts, allows NRCS to acquire permanent 
easements, and establishes limitations on the use of funds for cost-
share agreements and easements. The final rule also amends the 
regulation in response to comments received by the agency on the 
proposed rule.
    After review of the previous Environmental Assessment (EA) prepared 
in April 2006, it has been determined that the changes are minor and do 
not present significant new circumstances or new information relative 
to environmental issues from those analyzed in the 2006 EA. 
Accordingly, NRCS has determined and reaffirms that the previous EA and 
Finding of No Significant Impact have sufficiently analyzed the 
program's potential environmental impacts and are inclusive of the 
final rule.
    Copies of the EA and the Finding of No Significant Impact may be 
obtained from the Healthy Forests Reserve Program Manager, Easements 
Programs Division, Department of Agriculture, Natural Resources 
Conservation Service, 1400 Independence Avenue, SW., Room 6813 South 
Building, Washington, DC 20250; or electronically on the Internet 
through the NRCS homepage at: http://www.nrcs.usda.gov, and by 
selecting ``Programs,'' then ``Healthy Forests Reserve Program.''

Paperwork Reduction Act

    The forms that will be utilized to implement this regulation have 
previously been approved for use and OMB assigned the control number 
0578-0013. NRCS estimates that HFRP results in the following changes to 
the current package:
    Type of Request: New Information Collection Package/form/etc.
    <bullet> Increase of 26,020 respondents.
    <bullet> Increase of 23,926.3 responses.
    <bullet> Increase burden hours by 27,768.12.
    <bullet> Increase in the average time to execute a form in the 
collection: 0.229 hours or 14.03 minutes.

Government Paperwork Elimination Act

    NRCS is committed to compliance with the Government Paperwork 
Elimination Act and the Freedom to E-File Act, which require government 
agencies, in general, to provide the public the option of submitting 
information or transacting business electronically to the maximum 
extent possible.

Civil Rights Impact Analysis

    NRCS has determined through a Civil Rights Impact Analysis that 
this final rule discloses no disproportionately adverse impacts for 
minorities, women, or persons with disabilities. The data presented 
indicates producers who are members of the protected groups have 
participated in NRCS conservation programs at parity with other 
producers. Extrapolating from historical participation data, it is 
reasonable to

[[Page 6540]]

conclude that NRCS programs, including the HFRP, will continue to be 
administered in a non-discriminatory manner. Outreach and communication 
strategies are in place to ensure all producers will be provided the 
same information to allow them to make informed compliance decisions 
regarding the use of their lands that will affect their participation 
in USDA programs. The HFRP applies to all persons equally. Therefore, 
this final rule portends no adverse civil rights implications for 
women, minorities, and persons with disabilities.
    Copies of the Civil Rights Impact Analysis are available, and may 
be obtained from John Glover, Branch Chief, Easement Programs Branch, 
Natural Resources Conservation Service, 1400 Independence Avenue, SW., 
Room 6819 South Building, Washington, DC 20250, or electronically at: 
http://www.nrcs.usda.gov/programs/HFRP.

Civil Justice Reform

    This final rule has been reviewed in accordance with Executive 
Order 12988, Civil Justice Reform. The rule is not retroactive and 
preempts State and local laws to the extent that such laws are 
inconsistent with this rule. Before an action may be brought in a 
Federal court of competent jurisdiction, the administrative appeal 
rights afforded persons at 7 CFR parts 614 and 11 must be exhausted.

Executive Order 13132

    This final rule has been reviewed in accordance with the 
requirements of Executive Order 13132, Federalism. NRCS has determined 
that this final rule conforms with the Federalism principles set forth 
in the Executive Order; would not impose any compliance costs on the 
States; and would not have substantial direct effects on the States, on 
the relationship between the Federal Government and the States, or on 
the distribution of power and responsibilities on the various levels of 
government. Therefore, NRCS concludes that this final rule does not 
have Federalism implications. Moreover, Sec.  625.5 of this final rule 
shows sensitivity to Federalism concerns by providing an option for the 
responsible official (State Conservationist) to obtain input from other 
agencies in proposal development.

Unfunded Mandates Reform Act of 1995

    Pursuant to Title II of the Unfunded Mandates Reform Act of 1995 (2 
U.S.C. 1531-1538), NRCS assessed the effects of this rulemaking action 
on State, local, and tribal governments, and the public. This action 
does not compel the expenditure of $100 million or more by any State, 
local, or tribal governments or anyone in the private sector; 
therefore, a statement under section 202 of the Unfunded Mandates 
Reform Act of 1995 is not required.

Executive Order 13175, Consultation and Coordination With Indian Tribal 
Governments

    NRCS has assessed the impact of this final rule on Indian tribal 
governments and has concluded that this rule will not negatively affect 
communities of Indian tribal governments. The statutory changes to the 
HFRP as a result of the 2008 Act created an option of offering 30-year 
contracts to encourage Indian tribal participation in the program. 
Section 625.12 of this final rule outlines the procedures for enrolling 
land in the program through the 30-year contract option. The rule will 
neither impose substantial direct compliance costs on tribal 
governments, nor preempt tribal law.

Background

    America's forests provide a wide range of environmental, economic, 
and social benefits including timber, wilderness, minerals, recreation 
opportunities, and wildlife habitat. In addition, a healthy forest 
ecosystem provides habitat for endangered and threatened species, 
sustains biodiversity, protects watersheds, sequesters carbon, and 
helps purify the air. However, some forest ecosystems have had their 
ecological functions diminished by a number of factors including 
fragmentation, reduction in periodic fires, lack of proper management, 
or invasive species. Habitat loss has been severe enough in some 
circumstances to cause dramatic population declines such as in the case 
of the Ivory-billed Woodpecker. As a result of the pressures on forest 
ecosystems, many forests need active management and protection from 
development in order to sustain biodiversity and restore habitat for 
species that have suffered significant population declines. Active 
management and protection of forest ecosystems can also increase carbon 
sequestration and improve air quality.
    Many forest ecosystems are located on private lands and provide 
habitat for species that have been listed as endangered or threatened 
under section 4 of the Endangered Species Act (ESA), 16 U.S.C. 1533 
(listed species). Congress enacted the HFRP, Title V of the Healthy 
Forest Restoration Act of 2003 (Pub. L. 108-148, 16 U.S.C. 6571-6578) 
to provide financial assistance to private landowners to undertake 
projects that restore and enhance forest ecosystems to help promote the 
recovery of listed species, improve biodiversity, and enhance carbon 
sequestration.
    The Secretary of Agriculture has delegated authority to implement 
HFRP to the NRCS Chief. In addition, technical support associated with 
forest management practices may also be provided by the U.S. Forest 
Service. Section 501 of Title V of the Healthy Forests Restoration Act 
of 2003 (Pub. L. 108-148) provides that the program will be carried out 
in coordination with the Secretary of Interior and the Secretary of 
Commerce. NRCS works closely with the U.S. Fish and Wildlife Service 
(FWS) and the National Marine Fisheries Service (NMFS) to further the 
species recovery objectives of the HFRP and to help make available to 
HFRP participants safe harbor or similar assurances and protection 
under ESA section 7(b)(4) or section 10(a)(1), 16 U.S.C. 1536(b)(4), 
1539(a)(1).

Response to Comments and Changes to the Regulation

    On January 14, 2009, NRCS published in the Federal Register a 
proposed rule for the HFRP with a 30-day public comment period that 
ended on February 13, 2009 (74 FR 1954). On February 18, 2009, the 
agency reopened the public comment period for the HFRP proposed rule 
for an additional 30 days, which ended on March 20, 2009 (74 FR 7563). 
NRCS received 13 responses to the proposed rule, encompassing 
approximately 68 comments. The respondents included individuals 
representing eight different agricultural or environmental 
organizations, three private citizens, a Federal agency respondent, and 
an Indian tribe. This section discusses all of the relevant comments 
except for those that expressed agreement with provisions of the 
proposed rule.

Purpose and Eligibility

    The statutory provisions at 16 U.S.C. 6571 state that the purpose 
of HFRP is to restore and enhance forest ecosystems in order to: (1) 
Promote the recovery of threatened and endangered species, (2) improve 
biodiversity, and (3) enhance carbon sequestration. Under 16 U.S.C. 
6572(b), to be eligible for enrollment, land must be:
    (1) Private land, the enrollment of which will restore, enhance, or 
otherwise measurably increase the likelihood of recovery of a species 
listed as endangered or threatened under 16 U.S.C. 1533; and
    (2) Private land, the enrollment of which will restore, enhance, or

[[Page 6541]]

otherwise measurably improve the well-being of species that--
    (a) Are not listed as endangered or threatened under 16 U.S.C. 
1533; but
    (b) Are candidates for such listing, State-listed species, or 
special concern species.
    The authorizing statute further provides at 16 U.S.C. 6572(c) that 
the Secretary of Agriculture will give additional consideration to 
enrollment of eligible land that will improve biological diversity and 
increase carbon sequestration.
    Comment: Three respondents recommended that the term native be used 
throughout the rule prior to the term forest ecosystem to focus 
attention on native forest ecosystems.
    Response: No changes were made to the regulation based on these 
comments. As stated above, the statutory language does not restrict 
HFRP to native forest ecosystems. There are situations in which the 
native habitat has been destroyed, and threatened and endangered 
species have adapted to using non-native habitats as their primary 
habitat. The insertion of native would create a barrier for 
participation in those situations. Additionally, the FWS and NMFS are 
part of the consultation process and can provide guidance and 
assistance on a case-by-case basis.
    Comment: One respondent recommended changing the definition of 
biodiversity to require organisms to be native to the ecological sub-
region and ecological complex.
    Response: NRCS made no changes to the regulation based on this 
comment. The definition of biodiversity in the proposed rule is 
consistent with the definitions used in other NRCS programs.
    Comment: One respondent asserted that NRCS should clarify the 
extent of the access required in the rule to distinguish between public 
access and agency access.
    Response: The regulation does not require HFRP participants to 
provide general public access. Based on the comment, NRCS inserted 
language at Sec.  625.11 (b)(1) and Sec.  625.12 (b)(1) to clarify that 
the right of access to the easement area is access for NRCS personnel 
or agency representatives.

Priority for Enrollment

    The statutory provisions at 16 U.S.C. 6572(f) provides the 
following regarding enrollment priority:
    (1) Species--The Secretary of Agriculture will give priority to the 
enrollment of land that provides the greatest conservation benefit to--
    (a) Primarily, species listed as endangered or threatened under 16 
U.S.C. 1533; and
    (b) Secondarily, species that--
    (i) Are not listed as endangered or threatened under 16 U.S.C. 
1533; but
    (ii) Are candidates for such listing, State-listed species, or 
special concern species.
    (2) Cost-effectiveness--The Secretary of Agriculture will also 
consider the cost-effectiveness of each agreement or easement and 
associated restoration plans, so as to maximize the environmental 
benefits per dollar expended.
    Comment: Two respondents requested additional clarity regarding the 
priority that will be given to enrolling projects that benefit wildlife 
species not listed under the ESA. They suggested defining State-listed 
species in the regulation.
    Response: Based on the comments, the agency added a definition of 
State-listed species under Sec.  625.2. NRCS has defined State-listed 
species as ``a species listed as threatened or endangered under State 
endangered species laws, a candidate for such listing, or a species 
listed in a State Wildlife Action Plan as a species of greatest 
conservation need.''
    Comment: Two respondents recommended that only native species be 
identified by the Chief for special consideration for funding.
    Response: No changes were made to the regulation based on these 
comments. While the rule allows the Chief to designate species of 
special concern, restricting this designation to only native species 
unnecessarily curtails the Chief's discretion and could serve as a 
barrier, preventing protection in areas where it is needed.
    Comment: One respondent suggested that a dedicated amount of funds 
be set aside for family forest lands.
    Response: No changes were made to the regulations based on this 
comment because NRCS determined there is no statutory basis supporting 
a set-aside for family forest lands. A separate set-aside for family 
forest lands creates a special priority category. As noted above, 16 
U.S.C. 6572(f) sets forth the criteria for enrollment priority and no 
statutory authority exists to give priority to family forest lands 
eligible for participation in HFRP.
    Comment: Two respondents suggested that priority be given to 
projects based on the priority forest areas identified in the State 
Forest Resource Assessment and Strategy required by section 8002 of the 
2008 Act. Another respondent suggested that attention to forest 
resources should be immediate and not wait for the completion of the 
state-wide assessment.
    Response: No changes were made to the regulation based on these 
comments. NRCS agrees that the concept of using the priority forest 
areas established by the report is a good concept. However, the report 
is currently underway and will not be complete until the end of fiscal 
year 2010. NRCS will incorporate guidance in policy on utilizing the 
information provided by the report once it is complete.
    Comment: One respondent suggested that significant weight should be 
given to projects that increase carbon sequestration.
    Response: No changes were made to the regulations based on this 
comment. Enhancing carbon sequestration is one of the purposes of the 
program which is detailed in the statute (16 U.S.C. 6571 and 6572). 
Under Sec.  625.6 of the final rule, one of the ranking criteria is the 
extent to which projects have the potential for increased capability of 
carbon sequestration.
    Comment: Two respondents asserted that the rule does not clearly 
articulate how cost-effectiveness will be estimated. Both suggested 
that the cost-effectiveness of the restoration cost-share agreement, 
contract, or easement and associated HFRP restoration plans be 
calculated by dividing the total expected environmental benefits by the 
total expected cost of the project.
    Response: No changes were made to the regulation based on these 
comments. NRCS will address this issue in policy to provide the maximum 
flexibility. The State Conservationist needs the flexibility to 
determine how cost-effectiveness will be estimated due to the wide 
variability of environmental benefits and diverse habitats of land 
enrolled in the program.
    Comment: One respondent suggested that NRCS use separate ranking 
pools to evaluate fairly the cost-effectiveness of short-term and long-
term agreements. Another respondent suggested NRCS compare projects 
with other projects of similar ownership and size. The respondent was 
concerned that smaller projects are disadvantaged when compared with 
larger projects that appear more cost-effective.
    Response: No changes were made to the regulation based on these 
comments. By policy, State Conservationists have the authority to 
create separate ranking pools for different types of agreements to 
ensure fair evaluation of projects.
    Comment: Several respondents recommended that NRCS require State 
Conservationists to work with other agencies and organizations when 
developing proposals. One respondent suggested the requirement include 
State Foresters, State Technical Committees,

[[Page 6542]]

and State Forest Stewardship Committees; three respondents suggested 
the requirement include all local, State, and Federal agencies; and one 
respondent suggested the requirement include the appropriate State fish 
and wildlife agency.
    Response: No changes were made to the regulation based on these 
comments. NRCS cannot require that the State Technical Committee be 
consulted because HFRP is not a program in the Conservation Title. The 
rule provides flexibility to the State Conservationists to determine 
with whom it is appropriate to work when developing proposals and 
implementing the program. The suggested changes would require 
consultation and limit the discretion and flexibility of the State 
Conservationist.
    Comment: Two respondents suggested that the ranking considerations 
be developed with State fish and wildlife agencies and be separated 
into primary and secondary ranking considerations, similar to the 
statutory language. Another respondent suggested that all ranking 
considerations should be required to be considered.
    Response: No changes were made to the regulation based on these 
comments. The required ranking considerations are found in the final 
rule at Sec.  625.6. The associated weighting of the ranking 
considerations is the responsibility of the State Conservationist. The 
State Conservationist works with cooperating agencies, which may 
include the State fish and wildlife agencies, to obtain input and 
advice on weighting and applying the ranking factors. The ranking 
structure proposed by the respondents would require specific ranking 
criteria to be considered regardless of the local conditions. The 
current structure of the regulation allows State Conservationists to 
ensure that local conditions are considered in applying the ranking 
criteria.

Term of Enrollment

    Statutory provisions at 16 U.S.C. 6572(e)(1) provide that land may 
be enrolled in the HFRP in accordance with:
    <bullet> A 10-year cost-share agreement,
    <bullet> A 30-year easement, or
    <bullet> A permanent easement or an easement for the maximum 
duration allowed under State law.
    Under the provisions of 16 U.S.C. 6572(e)(3), the statute allows 
acreage owned by Indian tribes to be enrolled into the program through 
the use of 30-year contracts or 10-year cost-share agreements, or a 
combination of the two.
    Comment: NRCS specifically requested comments on the definition of 
``acreage owned by Indian tribes'' and the accompanying requirements 
for 30-year contracts at Sec.  625.12. In response, NRCS received one 
comment. The respondent suggested that NRCS revise the definition of 
``acreage owned by Indian tribes'' to allow Indian lands held in trust 
to be eligible for the program.
    Response: No changes were made to the regulation based on this 
comment. As stated in the preamble to the proposed rule, ``The 
statement of managers (Conference Report H.R. 110-627 for H.R. 2419, 
pages 202 and 203, May 13, 2008) provided additional clarification of 
congressional intent by stating that ``the managers intend that tribal 
land enrolled in the program should be land held in private ownership 
by a tribe or an individual tribal member. Tribal lands held in trust 
or reserved by the United States Government or restricted fee lands 
should not be enrolled in the program regardless of ownership.'' The 
managers' report language can be used to elucidate the meaning of the 
statute. Based on this language, NRCS interpreted the meaning of 
``acreage owned by Indian tribes'' as including only land to which the 
title is held by individual Indians and Indian tribes, including Alaska 
Native Corporations. Lands held in Trust by the United States or 
allotted lands which contain restraints against alienation are not 
eligible under the definition of ``acreage owned by Indian tribes.'' 
For purposes of clarity, NRCS removed the word ``private'' from this 
definition in the final rule because the inclusion of the word 
``private'' was redundant and could create confusion when implemented. 
The definition of ``private land'' includes land that meets the 
definition of ``acreage owned by Indian tribes.'' NRCS also revised the 
definition of ``30-year contract'' to include the term ``acreage owned 
by Indian tribes'' and to remove the reference to land held in private 
ownership and the reference to ``individual tribal members'' for the 
reasons listed above. Additionally, NRCS removed the phrase ``including 
Alaska Native Corporations'' from the definition because it was 
repetitive.
    Comment: Two respondents suggested that NRCS require that direct 
benefits to the target species be realized during the contract period.
    Response: No changes were made to the regulation based on these 
comments. Section 625.4 applies to all eligible land, including 
permanent easements. The change suggested by the respondents to include 
``within the contract period'' would be confusing because this section 
addresses all enrollment options, and this phrase is not applicable to 
easements. Additionally, there are circumstances in which the desired 
benefits may not occur within the contract period, though such benefits 
will likely be obtained as a result of HFRP financial and technical 
assistance. For example, HFRP assistance through a 30-year easement may 
facilitate the establishment of a mature hardwood forest, though the 
trees planted with HFRP assistance will not have reached full maturity 
at the end of the 30-year easement period. The respondents proposed 
change would render such land ineligible for the program.
    Comment: Two respondents asserted that NRCS should spend no less 
than 60 percent of HFRP funds on permanent easements. Another 
respondent suggested that NRCS favor shorter term easements and 
restoration cost-share agreements over permanent easements.
    Response: No changes were made to the regulation based on these 
comments because the statutory requirements determine the allocation of 
funds. The original HFRP statutory language required that ``the extent 
to which each enrollment method is used will be based on the 
approximate proportion of owner interest expressed in that method in 
comparison to the other methods.'' However, the 2008 Act amended the 
HFRP statute to include language specifying that 40 percent of program 
expenditures in any fiscal year be for restoration cost-share agreement 
enrollment and 60 percent of program expenditures in any fiscal year be 
for easement enrollment. The 2008 Act allows re-allocation if funds are 
not obligated by April 1 of the fiscal year in which the funds were 
made available.
    Comment: One respondent asserted that NRCS should allow States the 
flexibility to allocate funds according to local needs under the re-
pooling provision.
    Response: No changes were made to the regulation based on this 
comment. The preamble of the proposed rule stated that ``NRCS proposes 
to manage this process at the national level to ensure that the 
allocation of funds meets the statutory requirements.'' The agency will 
manage the re-pooling of funds at National Headquarters to ensure that 
the statutory requirements are met.
    Comment: Two respondents suggested that NRCS limit the allocation 
of program resources to States that have developed proposals likely to 
result in the most significant and cost-effective benefits to the 
forest ecosystems and species.
    Response: No changes were made to the regulation based on these 
comments. The respondents' suggestion limits HFRP enrollment to a 
select number of

[[Page 6543]]

States. NRCS does not believe Congress intended to limit the 
implementation of the program in this manner. The sign-up process, 
detailed in Sec.  625.5(a), is designed to target funding to the most 
significant and cost-effective proposals.

Restoration Plans

    As a condition of HFRP participation, a landowner must agree to the 
implementation of a HFRP restoration plan. The purpose of the 
restoration plan is to restore, protect, enhance, maintain, and manage 
the habitat conditions necessary to increase the likelihood of recovery 
of listed species under the ESA, or measurably improve the well-being 
of species that are not listed but are candidates for such listing, 
State-listed species, or species identified by the Chief for special 
consideration for funding.
    Under the provisions of 16 U.S.C. 6572, NRCS is to carry out the 
HFRP in coordination with FWS and NMFS. The provisions of Sec.  
625.13(c), which concern the HFRP restoration plan development, specify 
that NRCS, in coordination with the FWS, will determine the 
conservation practices and measures for the restoration plan.
    Comment: Two respondents suggested including other agencies in the 
development of the restoration plan.
    Response: No changes were made to the regulation based on these 
comments. The rule allows the State Conservationists to confer with FWS 
and NMFS in developing the restoration plan. The State Conservationists 
have the authority to consult with other agencies in the development of 
the restoration plan as necessary.
    Comment: Three respondents suggested that NRCS reword Sec.  
625.13(c) to require that carbon sequestration management promote 
diverse and high quality native forest ecosystems to accomplish the 
goals of the restoration plan.
    Response: Based on the comments, NRCS inserted the language 
suggested by the respondents in Sec.  625.13(c). NRCS agrees with the 
respondents and is concerned that the most effective plants for 
sequestering carbon may be non-native species that may not be 
appropriate for maintaining habitat. NRCS agrees that for carbon 
sequestration purposes, the plants should be required to be native to 
the environment in which they are being planted.
    Comment: One respondent recommended that restoration plans be 
tailored to help landowners adapt their management strategies in a 
changing climate.
    Response: No changes were made to the regulation based on this 
comment. The planning process includes selecting plants that are widely 
adapted to tolerate changes in climate. The restoration plan may be 
modified by the parties to address changing circumstances, including 
changes to facilitate climate adaptation.
    Comment: Two respondents suggested that the language in Sec.  
625.14 is inconsistent because the first sentence of the section says 
that modifications may be approved if they do not modify or void 
provisions of the easement, and later in the section the regulation 
says that modifications may require execution of an amended easement.
    Response: Section 625.14 discusses modifications to the HFRP 
restoration plan; it is not discussing modification to an HFRP 
easement. There is no statutory authority for HFRP easements to be 
modified. In order for a restoration plan to be modified, the 
modification must meet HFRP program objectives and must result in equal 
or greater wildlife benefits and ecological and economic values to the 
United States. In order to avoid confusion regarding the modification 
of an HFRP restoration plan, NRCS has inserted the phrase ``to the 
restoration plan'' and removed the word ``easement'' from Sec.  625.14.
    Comment: One respondent suggested that any modification to an HFRP 
restoration plan should require agreement from the landowner, FWS, 
NMFS, or the State fish and wildlife agency.
    Response: No changes were made to the regulation based on this 
comment. The final rule at Sec.  625.14 affirms that NRCS will 
coordinate with the landowner, FWS, and NMFS to determine if a 
modification to the restoration plan is justified.

Cost-Share Payments

    Comment: One respondent asserted that NRCS should use actual costs 
rather than average costs for determining cost-share assistance 
reimbursement rates. The HFRP statutory language allows for NRCS to 
reimburse a percentage of either the actual cost or the average cost of 
approved practices. The respondent asserted that average costs may be 
far lower than the actual cost and therefore, make full program 
implementation less likely where landowners do not receive 
reimbursement for their full expenses.
    Response: No changes were made to the regulation based on this 
comment. Calculating actual costs would significantly increase the 
administrative workload and reduce the amount of financial assistance 
available to HFRP participants. Average costs, as determined on a 
regional basis, will be used to ensure that the average costs are close 
to actual costs in that area.
    However, for purposes of clarity, NRCS revised Sec.  625.3(d) and 
Sec.  625.13(c) to establish that the State Conservationist will 
develop the list of eligible restoration practices, payment rates, and 
cost-share percentages. The State Conservationist will not determine 
the rates of compensation for an easement or 30-year contract because 
those rates will be established through the process outlined in Sec.  
625.8.
    NRCS also revised Sec.  625.10(g) to clarify that payments will not 
be made on components of a conservation practice or measure. This 
change was made to ensure consistency with other NRCS programs.

Compensation

    The statutory provisions at 16 U.S.C. 6574 establish the 
requirements for easement compensation rates. Subsection (a) provides 
that the Secretary of Agriculture will pay a landowner for a permanent 
easement not less than 75 percent, nor more than 100 percent of the 
fair market value of the land enrolled during the period the land is 
subject to the easement, less the fair market value of the land 
encumbered by the easement (as determined by the Secretary). The 
statute provides that the Secretary will pay the same rate for 
easements that are for the maximum duration allowed under State law.
    As stated in the preamble to the proposed rule, Federal agencies 
generally follow the Uniform Relocation Assistance and Real Property 
Acquisition Policies for Federal and Federally Assisted Programs (the 
Uniform Relocation Act), the Uniform Relocation Act's implementing 
regulations at 49 CFR part 24, and the Uniform Appraisal Standards for 
Federal Land Acquisitions (the Yellow Book). The Yellow Book requires 
that compensation be based upon the impact that the easement 
encumbrance will have on the value of the larger parcel, which includes 
all land owned by the landowner that may be impacted by the easement, 
as determined by the appraiser.
    However, where agencies have statutory authority to waive general 
appraisal procedures, Federal agencies can develop alternative 
appraisal and valuation methodologies. Under the SAFE-TEA-LU Act, NRCS 
is exempt from the requirements of 49 CFR part 24. The HFRP language 
for permanent and maximum duration easements requires that compensation 
be based on the impact to the value of only the land

[[Page 6544]]

enrolled and encumbered by the easement. Thus, the Yellow Book 
requirement of appraising the larger parcel does not apply for 
permanent easements, or those of the maximum duration required by State 
law.
    Comment: NRCS specifically requested comments on the language 
regarding the establishment of easement compensation rates at Sec.  
625.8. In response, NRCS received three comments. All respondents were 
in agreement that NRCS should not use the Yellow Book appraisal 
process.
    Response: No changes were made to the regulation based on these 
comments. NRCS will use the Uniform Standards for Professional 
Appraisal Practice to determine easement compensation values under 
HFRP. NRCS will use the same methodology to determine compensation 
values for all HFRP easements, both permanent and 30-year, to reduce 
confusion and maintain consistency.
    Comment: One respondent suggested that HFRP use the same appraisal 
process as the Wetlands Reserve Program (WRP).
    Response: No changes were made to the regulation based on this 
comment. HFRP has different statutory requirements than the WRP. The 
statutory requirements of HFRP do not allow for the program to use the 
same method of compensation as the WRP.
    Comment: NRCS also specifically requested comments on the language 
regarding ownership of ecosystem services credits at Sec.  625.8(f). In 
response, the agency received three comments. All three respondents 
supported the ecosystem services credits language.
    Response: No changes were made to the regulation as a result of 
these comments. However, minor changes were made to the language in 
Sec.  625.8 to ensure consistency across all NRCS programs.

Landowner Protections and Safe Harbor Agreements

    The 2006 HFRP interim final rule (71 FR 28557) included a 
definition of Landowner Protections as part of Sec.  625.2 and the 
preamble to that rule described those protections and how program 
participants obtain them (71 FR 28548-28550). Landowner Protections 
were defined in the 2006 interim final rule as:

    ``* * * protections and assurances made available to HFRP 
participants whose voluntary conservation activities result in a net 
conservation benefit for listed, candidate, or other species. 
Landowner Protections made available by the Secretary of Agriculture 
to HFRP participants may be provided under section 7(b)(4) or 
section 10(a)(1) of the Endangered Species Act of 1973 (ESA; 16 
U.S.C. 1536(b)(4), 1539(a)(1)). These Landowner Protections may be 
provided by NRCS in conjunction with meeting its responsibilities 
under section 7 of the ESA, or by FWS or NFMS through section 10 of 
the ESA. These Landowner Protections include a permit providing 
coverage for incidental take of species listed under the ESA. 
Landowner Protections also include assurances related to potential 
modifications of HFRP restoration plans and assurances related to 
the potential (unlikely) termination of Landowner Protections and 
any 10-year cost share agreement.''

    Landowner Protections are contingent upon the HFRP restoration plan 
and associated cost-share agreement or easement being properly 
implemented. There is no requirement that HFRP participants obtain any 
Landowner Protections. Generally, the three elements of Landowner 
Protections are: (1) Authorization for the take of endangered or 
threatened species when conducting management activities under a HFRP 
restoration plan and when returning to the baseline conditions at the 
end of the cost-share agreement or easement period (whichever is 
longer), (2) assurance that the landowner will not be required to 
undertake additional or different management activities without the 
consent of the landowner, and (3) limitations on the possibility of 
termination of a HFRP restoration plan that is being properly 
implemented by the landowner.
    The definition of Landowner Protections in the interim final rule 
(and text in the preamble) included a description of two approaches 
that the Secretary of Agriculture may use to make Land Protections 
available to HFRP participants. The regulation at Sec.  625.13(d) 
specifies the two ways that NRCS can make Landowner Protections 
available to HFRP participants upon request. The first approach 
involves NRCS and the HFRP participant, and does not require the HFRP 
participant to have direct involvement with FWS or NMFS. Under this 
approach, NRCS will extend to participants the incidental take 
authorization received by NRCS from FWS or NMFS through biological 
opinions issued as part of the interagency consultation process under 
section 7(a)(2) of the ESA.
    Under the second approach for Landowner Protections, NRCS will 
provide technical assistance to help participants design and use their 
HFRP restoration plan for the dual purposes of qualifying for HFRP 
financial assistance, and as a basis for entering into a Safe Harbor 
Agreement (SHA) or Candidate Conservation Agreement with Assurances 
(CCAA) with the FWS or NMFS under section 10(a)(1)A of the ESA. SHAs 
are voluntary arrangements between either the FWS or NMFS and 
cooperating participants who agree to adopt practices and measures, or 
refrain from certain activities in order to achieve net conservation 
benefits, i.e., a contribution to the recovery of listed species.
    A CCAA is a voluntary agreement between the FWS or NMFS and 
cooperating participants whereby landowners who voluntarily agree to 
manage their lands or waters to remove threats to species at risk of 
becoming listed under the ESA as threatened or endangered receive 
assurances that their conservation efforts will not result in future 
regulatory obligations in excess of those they agree to at the time 
they enter into the Agreement. CCAAs are intended to help conserve 
proposed and candidate species, and species likely to become candidates 
by giving private, non-Federal landowners incentives to implement 
conservation measures for declining species. The primary incentive for 
CCAAs is an assurance that no further additional land, water, or 
resource use restrictions would be imposed should the species later 
become listed under the ESA.
    There is no requirement that HFRP participants enter into a SHA or 
a CCAA. All SHAs are subject to the SHA policy jointly adopted by FWS 
and NMFS (Announcement of Final Policy, 64 FR 32717, June 17, 1999), 
and SHAs with the FWS also are subject to regulations at 50 CFR part 
17, and specifically 50 CFR 17.22(c) for endangered species or 17.32(c) 
for threatened species. All CCAAs are subject to the CCAA policy 
jointly adopted by FWS and NMFS (Announcement of Final Policy, 64 FR 
32726, June 17, 1999), and CCAAs with the FWS are also subject to 
regulations at 50 CFR part 17, and specifically 50 CFR 17.22(d) for 
endangered species or 17.32(d) for threatened species.
    Comment: One Federal agency respondent suggested that the 
regulation clarify the landowner protection section to include a return 
to baseline conditions at the end of the easement, contract, or 
agreement. The respondent suggested that NRCS do this in one of two 
ways, either in the definition of landowner protection or in the 
landowner protections section of the regulation.
    Response: NRCS has decided that this clarification is needed, and 
that the issue will be better clarified in the landowner protections 
section of the regulation. Based on this comment, NRCS added Sec.  
625.13(d)(1)(iii) to the Incidental Take section and

[[Page 6545]]

Sec.  625.13(d)(2)(iv) to the SHA or CCAA section to include a return 
to baseline conditions at the end of the applicable period.
    Comment: Two respondents recommended that NRCS modify Sec.  
625.13(d) to clarify that the Landowner Protections discussed in that 
section are intended to apply to HFRP participants.
    Response: Based on these comments, NRCS corrected Sec.  625.13(d) 
by inserting a comma after ``species,'' removing the words ``a 
participant,'' and removing the period at the end of the sentence. 
These changes help clarify that Landowner Protections are available to 
HFRP participants.
    Comment: One respondent suggested that NRCS provide landowners with 
an assurance that they will not be found in violation of the ESA or 
other environmental laws.
    Response: No changes were made to the regulation based on this 
comment. NRCS cannot offer this type of assurance to landowners. A 
landowner may be in violation of the ESA if they are acting outside of 
the SHA/CCAA agreement. It is the responsibility of the landowner to 
ensure that actions outside of the landowner protections provided by 
NRCS are consistent with all applicable Federal and State laws. NRCS 
does not have the authority to provide any assurances regarding 
compliance with other applicable environmental laws.

Compatible Use Authorizations

    Comment: Two respondents suggested that it may be more important to 
address the issue of compatible uses in the context of 10-year 
agreements than in the context of easements. The respondents felt that 
compatible use agreements should not be needed for properties subject 
to easements since the easement specifically prohibits certain uses and 
allows all others.
    Response: No changes were made to the regulation based on these 
comments. The purpose of a compatible use agreement is to allow a 
landowner to conduct a prohibited activity on the easement if it will 
benefit the functions and values of the easement. A compatible use 
agreement is necessary in the context of an easement, particularly a 
permanent easement, which is a recorded property right and cannot be 
changed. However, a compatible use agreement is not necessary for a 10-
year restoration cost-share agreement because the agreement itself can 
be altered to permit the activity that will benefit the land.
    Comment: Two respondents recommended that NRCS include a definition 
of the term ``compatible use'' in the rule.
    Response: NRCS did not make any changes to the regulation based on 
these comments. Although the term is used in the rule, the types of 
activities that may be considered compatible may change depending on 
the circumstances. In order to allow for flexibility, NRCS will define 
the term compatible use in the policy consistent with other NRCS 
programs that allow compatible use authorizations.
    Comment: Three respondents asserted that NRCS does not have the 
authority to regulate hunting and fishing as compatible uses because 
they are a reserved right of the landowner.
    Response: Although undeveloped recreational hunting and fishing is 
identified in the deed as a reserved right to the landowner, any 
activity above and beyond undeveloped recreational use may only be 
authorized by NRCS through the compatible use process. The HFRP deed 
does not reserve to the landowner an unfettered right to hunt and fish 
as suggested by the respondents. In order to clarify this issue, the 
agency removed language from Sec.  625.11(b)(2) which gave examples of 
what types of activities may be granted a compatible use agreement. 
NRCS removed the compatible use paragraph from Sec.  625.11(b)(2) and 
combined it with Sec.  625.11(b)(3). The new combined paragraph at 
Sec.  625.11(b)(2) now allows NRCS the right to determine and permit 
compatible uses on the easement area and specify the amount, timing, 
method, intensity, and duration of the compatible use, if such use is 
consistent with the long-term protection and enhancement of the 
purposes for which the easement was established. This new paragraph 
avoids confusion over what activities may be granted a compatible use, 
and instead focuses on the standard an activity must meet in order for 
a compatible use to be granted.
    Comment: Three respondents suggested that NRCS should add 
prescribed fire, grazing, and silviculture practices as compatible uses 
which are consistent with the long-term protection and enhancement of 
the purposes for which the easement was established.
    Response: No changes were made to the regulation as a result of 
these comments. As mentioned above, whether or not these activities 
will be considered compatible uses will depend on site-specific 
circumstances. In addition, the change made in response to the comments 
regarding hunting and fishing at Sec.  625.11(b)(2) will provide 
additional clarity on this issue. The HFRP deed allows landowners to 
conduct routine forestry operations and management practices as long as 
such activities are consistent with the terms of the deed and the 
restoration plan. If the activity is allowed by the deed and consistent 
with the terms of the deed and the restoration plan, no compatible use 
authorization is required.

Termination of Landowner Protections

    As provided for in this final rule in the definition of Landowner 
Protections in Sec.  625.2 and the associated provision at Sec.  
625.13(d), all appropriate options will be pursued with the participant 
to avoid termination of the landowner protections in the case of 
landowner non-compliance or changed conditions. If the participant has 
entered into a SHA or CCAA with the FWS or NMFS (the Services) based on 
a HFRP restoration plan, NRCS will work with the participant and the 
Services to seek appropriate means of avoiding revocation of a permit 
issued under section 10(a)(1) of the ESA by FWS or NMFS to implement 
the SHA or CCAA. However, in the event of a termination, any requested 
assurances from NRCS will be voided, and the landowner will be 
responsible to FWS or NMFS for any violations of the ESA.
    The SHA policy regarding revocation of a permit issued in 
association with a SHA is: ``The Services are prepared as a last resort 
to revoke a permit implementing a Safe Harbor Agreement where 
continuation of the permitted activity would be likely to result in 
jeopardy to a species covered by the permit. Prior to taking such a 
step, however, the Services would first have to exercise all possible 
means to remedy such a situation'' (64 FR 32724). Regulations 
pertaining to SHA permits issued by FWS have a similar provision (50 
CFR 17.22(c)(7) and 17.32(c)(7)) for endangered and threatened 
wildlife.
    Comment: One respondent suggested that NRCS require the landowner 
to coordinate with all parties to the agreement if there is termination 
or transfer of a SHA or a CCAA.
    Response: The proposed rule at Sec.  625.13(d)(2)(iv) required 
landowners to notify and coordinate with FWS and NMFS, as appropriate, 
in the event of a termination of the agreement. NRCS agrees that the 
landowner should be responsible for coordinating with any party to the 
specific SHA or CCAA, as applicable, such as State fish and wildlife 
agencies. Based on this comment, NRCS inserted language at Sec.  
625.13(d)(2)(v) to require landowners to notify and coordinate with any 
relevant party to the specific SHA or CCAA.

[[Page 6546]]

Tribal Consultation

    Comment: One respondent suggested that the regulations should 
require consultation with Indian tribes to discuss impacts and evaluate 
the effectiveness of the program over time.
    Response: No changes were made to the regulation based on this 
comment. Participation in HFRP is voluntary, and the proposed rule did 
not meet the threshold for requiring consultation as specified by 
Executive Order 13175. However, NRCS remains committed to seeking 
advice, guidance, and counsel from Indian tribes in regard to natural 
resource concerns and issues. Indian tribes interested in providing 
input regarding HFRP policies may submit their request directly to the 
Chief.

Miscellaneous Changes for Clarification and Improved Program 
Administration

    NRCS removed the definition of ``contract or agreement'' for 
clarity because each of the possible contracts or agreements under HFRP 
are defined specifically so a general definition is not necessary and 
may create confusion.
    NRCS removed the term ``option agreement to purchase'' throughout 
the document and replaced the term with ``agreement to purchase'' to 
reflect more accurately the way the document is used and to allow for 
consistency with other easement programs.
    NRCS made other non-substantive changes for the purpose of clarity 
and consistency with other NRCS programs. These changes are set forth 
in the text portion of this document.

List of Subjects in 7 CFR Part 625

    Administrative practice and procedure, Agriculture, Soil 
conservation, and Forestry.

0
For the reasons stated in the preamble, NRCS revises 7 CFR part 625 to 
read as follows:

PART 625--HEALTHY FORESTS RESERVE PROGRAM

Sec.
625.1 Purpose and scope.
625.2 Definitions.
625.3 Administration.
625.4 Program requirements.
625.5 Application procedures.
625.6 Establishing priority for enrollment in HFRP.
625.7 Enrollment of easements, contracts, and agreements.
625.8 Compensation for easements and 30-year contracts.
625.9 10-year restoration cost-share agreements.
625.10 Cost-share payments.
625.11 Easement participation requirements.
625.12 30-year contracts.
625.13 The HFRP restoration plan development and Landowner 
Protections.
625.14 Modification of the HFRP restoration plan.
625.15 Transfer of land.
625.16 Violations and remedies.
625.17 Payments not subject to claims.
625.18 Assignments.
625.19 Appeals.
625.20 Scheme and device.

    Authority: 16 U.S.C. 6571-6578.


Sec.  625.1  Purpose and scope.

    (a) The purpose of the Healthy Forests Reserve Program (HFRP) is to 
assist landowners, on a voluntary basis, in restoring, enhancing, and 
protecting forestland resources on private lands through easements, 30-
year contracts, and 10-year cost-share agreements.
    (b) The objectives of HFRP are to:
    (1) Promote the recovery of endangered and threatened species under 
the Endangered Species Act of 1973 (ESA);
    (2) Improve plant and animal biodiversity; and
    (3) Enhance carbon sequestration.
    (c) The regulations in this part set forth the policies, 
procedures, and requirements for the HFRP as administered by the 
Natural Resources Conservation Service (NRCS) for program 
implementation and processing applications for enrollment.
    (d) The Chief may implement HFRP in any of the 50 States, District 
of Columbia, Commonwealth of Puerto Rico, Guam, Virgin Islands, 
American Samoa, and the Commonwealth of the Northern Mariana Islands.


Sec.  625.2  Definitions.

    The following definitions will be applicable to this part:
    30-year Contract means a contract that is limited to acreage owned 
by Indian tribes. The 30-year contract is not eligible for use on 
tribal lands held in trust or subject to Federal restrictions against 
alienation.
    Acreage Owned by Indian Tribes means lands to which the title is 
held by individual Indians and Indian tribes. This term does not 
include land held in trust by the United States or lands where the fee 
title contains restraints against alienation.
    Biodiversity (Biological Diversity) means the variety and 
variability among living organisms and the ecological complexes in 
which they live.
    Candidate Conservation Agreement with Assurances (CCAA) means a 
voluntary arrangement between the U.S. Fish and Wildlife Service (FWS) 
or the National Marine Fisheries Service (NMFS), and cooperating non-
Federal landowners under the authority of section 10(a)(1) of the 
Endangered Species Act of 1973, 16 U.S.C. 1539(a)(1). Under the CCAA 
and an associated enhancement of survival permit, the non-Federal 
landowner implements actions that are consistent with the conditions of 
the permit. CCAA with FWS are also subject to regulations at 50 CFR 
17.22(d) for endangered species or 50 CFR 17.32(d) for threatened 
species, or applicable subsequent regulations.
    Carbon sequestration means the long-term storage of carbon in soil 
(as soil organic matter) or in plant material (such as in trees).
    Chief means the Chief of the Department of Agriculture (USDA) NRCS, 
or designee.
    Confer means to discuss for the purpose of providing information; 
to offer an opinion for consideration; or to meet for discussion, while 
reserving final decision-making authority with NRCS.
    Conservation practice means one or more conservation improvements 
and activities, including structural practices, land management 
practices, vegetative practices, forest management, and other 
improvements that benefit the eligible land and optimize environmental 
benefits, planned and applied according to NRCS standards and 
specifications.
    Conservation treatment means any and all conservation practices, 
measures, activities, and works of improvement that have the purpose of 
alleviating resource concerns, solving or reducing the severity of 
natural resource use problems, or taking advantage of resource 
opportunities, including the restoration, enhancement, maintenance, or 
management of habitat conditions for HFRP purposes.
    Coordination means to obtain input and involvement from others 
while reserving final decision-making authority with NRCS.
    Cost-share agreement means a legal document that specifies the 
rights and obligations of any participant accepted into the program. A 
HFRP cost-share agreement is a binding agreement for the transfer of 
assistance from USDA to the participant to share in the costs of 
applying conservation. A cost-share agreement under HFRP has a duration 
of 10-years.
    Cost-share payment means the payment made by NRCS to a program 
participant or vendor to achieve the restoration, enhancement, and 
protection goals of enrolled land in accordance with the HFRP 
restoration plan.
    Easement means a conservation easement, which is an interest in 
land defined and delineated in a deed

[[Page 6547]]

whereby the landowner conveys certain rights, title, and interests in a 
property to the United States for the purpose of protecting the forest 
ecosystem and the conservation values of the property.
    Easement area means the land encumbered by an easement.
    Easement payment means the consideration paid to a landowner for an 
easement conveyed to the United States under the HFRP.
    Fish and Wildlife Service is an agency of the Department of 
Interior.
    Forest Service is an agency of USDA.
    Forest ecosystem means a dynamic set of living organisms, including 
plants, animals, and microorganisms interacting among themselves and 
with the environment in which they live. A forest ecosystem is 
characterized by predominance of trees, and by the fauna, flora, and 
ecological cycles (energy, water, carbon, and nutrients).
    HFRP restoration plan means the document that identifies the 
conservation treatments that are scheduled for application to land 
enrolled in HFRP in accordance with NRCS standards and specifications.
    Indian tribe means any Indian tribe, band, Nation, or other 
organized group or community, including any Alaska Native village or 
regional or village corporation as defined in or established pursuant 
to the Alaska Native Claims Settlement Act (85 Stat. 688, 43 U.S.C. 
1601 et seq.), which is recognized as eligible for the special programs 
and services provided by the United States to Indians because of their 
status as Indians.
    Landowner means an individual or entity having legal ownership of 
land. The term landowner may also include all forms of collective 
ownership including joint tenants, tenants in common, and life tenants.
    Landowner protections means protections and assurances made 
available by NRCS to HFRP participants, when requested, and whose 
voluntary conservation activities result in a net conservation benefit 
for listed, candidate, or other species and meet other requirements of 
the program. These Landowner Protections are subject to a HFRP 
restoration plan and associated cost-share agreement, 30-year contract, 
or easement being properly implemented. Landowner protections made 
available by the Secretary of Agriculture to HFRP participants may 
include an incidental take authorization received by NRCS from FWS or 
NMFS, or may be provided by a Safe Harbor Agreement (SHA) or CCAA 
directly between the HFRP participant and FWS or NMFS, as appropriate.
    Liquidated damages means a sum of money stipulated in the HFRP 
restoration agreement that the participant agrees to pay NRCS if the 
participant fails to adequately complete the terms of the restoration 
agreement. The sum represents an estimate of the expenses incurred by 
NRCS to service the restoration agreement, and reflects the 
difficulties of proof of loss and the inconvenience or non-feasibility 
of otherwise obtaining an adequate remedy.
    Maintenance means work performed to keep the applied conservation 
practice functioning for the intended purpose during its life span. 
Maintenance includes work to prevent deterioration of the practice, 
repairing damage, or replacement of the practice to its original 
condition if one or more components fail.
    Measure means one or more specific actions that is not a 
conservation practice, but has the effect of alleviating problems or 
improving the treatment of the resources.
    National Marine Fisheries Service is an agency of the United States 
Department of Commerce.
    Natural Resources Conservation Service is an agency of USDA which 
has the responsibility for administering HFRP.
    Participant means a person, entity, or Indian tribe who is a party 
to a 10-year cost share agreement, 30-year contract, or an agreement to 
purchase an easement.
    Private land means land that is not owned by a local, State, or 
Federal governmental entity, and includes land that meets the 
definition of ``acreage owned by Indian tribes.''
    Restoration means implementing any conservation practice 
(vegetative, management, or structural) or measure that improves forest 
ecosystem values and functions (native and natural plant communities).
    Restoration agreement means a cost-share agreement between the 
program participant and NRCS to restore, enhance, and protect the 
functions and values of a forest ecosystem for the purposes of HFRP 
under either an easement, 30-year contract, or a 10-year cost-share 
agreement enrollment option.
    Safe Harbor Agreement means a voluntary arrangement between FWS or 
NMFS and cooperating non-Federal landowners under the authority of 
section 10(a)(1) of the Endangered Species Act of 1973, 16 U.S.C. 
1539(a)(1). Under the SHA and an associated enhancement of survival 
permit, the private property owner implements actions that are 
consistent with the conditions of the permit. SHAs with FWS are also 
subject to regulations at 50 CFR 17.22(c) for endangered species or 50 
CFR 17.32(c) for threatened species, or applicable subsequent 
regulations.
    State-listed species means a species listed as threatened or 
endangered under State endangered species laws, a candidate for such 
listing, or a species listed in a State Wildlife Action Plan as a 
Species of Greatest Conservation Need.
    Sign-up notice means the public notification document that NRCS 
provides to describe the particular requirements for a specific HFRP 
sign-up.
    State Conservationist means the NRCS employee authorized to 
implement HFRP and direct and supervise NRCS activities in a State, 
Caribbean Area, or Pacific Islands Area.
    Technical service provider means an individual, private-sector 
entity, or public agency certified by NRCS to provide technical 
services to program participants in lieu of or on behalf of NRCS.


Sec.  625.3  Administration.

    (a) The regulations in this part will be administered under the 
general supervision and direction of the Chief.
    (b) The Chief may modify or waive a provision of this part if the 
Chief determines that the application of such provision to a particular 
limited situation is inappropriate and inconsistent with the goals of 
the program. This authority cannot be further delegated. The Chief may 
not modify or waive any provision of this part which is required by 
applicable law.
    (c) No delegation in this part to lower organizational levels will 
preclude the Chief from determining any issue arising under this part 
or from reversing or modifying any determination arising from this 
part.
    (d) The State Conservationist will develop a list of eligible 
restoration practices, payment rates and cost-share percentages, a 
priority ranking process, and any related technical matters.
    (e) NRCS will coordinate with FWS and NMFS in the implementation of 
the program and in establishing program policies. In carrying out this 
program, NRCS may confer with private forest landowners, including 
Indian tribes, the Forest Service and other Federal agencies, State 
fish and wildlife agencies, State forestry agencies, State 
environmental quality agencies, other State conservation agencies, and 
nonprofit conservation organizations. No determination by the FWS, 
NMFS, Forest Service, any Federal, State, or

[[Page 6548]]

tribal agency, conservation district, or other organization will compel 
NRCS to take any action which NRCS determines will not serve the 
purposes of the program established by this part.


Sec.  625.4  Program requirements.

    (a) General. Under the HFRP, NRCS will purchase conservation 
easements from, or enter into 30-year contracts or 10-year cost-share 
agreements with, eligible landowners who voluntarily cooperate in the 
restoration and protection of forestlands and associated lands. To 
participate in HFRP, a landowner will agree to the implementation of a 
HFRP restoration plan, the effect of which is to restore, protect, 
enhance, maintain, and manage the habitat conditions necessary to 
increase the likelihood of recovery of listed species under the ESA, or 
measurably improve the well-being of species that are not listed as 
endangered or threatened under the ESA but are candidates for such 
listing, State-listed species, or species identified by the Chief for 
special consideration for funding. NRCS may provide cost-share 
assistance for the activities that promote the restoration, protection, 
enhancement, maintenance, and management of forest ecosystem functions 
and values. Specific restoration, protection, enhancement, maintenance, 
and management activities may be undertaken by the landowner or other 
NRCS designee.
    (1) Of the total amount of funds expended under the program for a 
fiscal year to acquire easements and enter into 10-year cost-share 
agreements, not more than 40 percent will be used for cost-share 
agreements, and not more than 60 percent will be used for easements.
    (2) The Chief may use any funds that are not obligated by April 1 
of the fiscal year for which the funds are made available to carry out 
a different method of enrollment during that fiscal year.
    (b) Landowner eligibility. To be eligible to enroll an easement in 
the HFRP, an individual or entity must:
    (1) Be the landowner of eligible land for which enrollment is 
sought; and
    (2) Agree to provide such information to NRCS, as the agency deems 
necessary or desirable, to assist in its determination of eligibility 
for program benefits and for other program implementation purposes.
    (c) Eligible land.
    (1) NRCS, in coordination with FWS or NMFS, will determine whether 
land is eligible for enrollment and whether once found eligible, the 
lands may be included in the program based on the likelihood of 
successful restoration, enhancement, and protection of forest ecosystem 
functions and values when considering the cost of acquiring the 
easement, 30-year contract, or 10-year cost share agreement, and the 
restoration, protection, enhancement, maintenance, and management 
costs.
    (2) Land will be considered eligible for enrollment in the HFRP 
only if NRCS determines that:
    (i) Such private land will contribute to the restoration or 
enhancement of the habitat or otherwise measurably increase the 
likelihood of recovery for a selected species listed under section 4 of 
the ESA; and
    (ii) Such private land will contribute to the restoration or 
enhancement of the habitat or otherwise measurably improve the well-
being of a selected species not listed under section 4 of the ESA but 
is a candidate for such listing, or the selected species is a State-
listed species, or is a species identified by the Chief for special 
consideration for funding.
    (3) NRCS may also enroll land adjacent to eligible land if the 
enrollment of such adjacent land would contribute significantly to the 
practical administration of the easement area, but not more than it 
determines is necessary for such contribution.
    (4) To be enrolled in the program, eligible land must be configured 
in a size and with boundaries that allow for the efficient management 
of the area for easement purposes and otherwise promote and enhance 
program objectives.
    (5) In the case of acreage owned by an Indian tribe, NRCS may 
enroll acreage into the HFRP which is privately owned by either the 
tribe or an individual.
    (d) Ineligible land. The following land is not eligible for 
enrollment in the HFRP:
    (1) Land owned by the United States, States, or units of local 
government;
    (2) Land subject to an easement or deed restriction that already 
provides for the protection of fish and wildlife habitat or that would 
interfere with HFRP purposes, as determined by NRCS; and
    (3) Land that would not be eligible for HFRP under paragraphs 
(c)(1) through (c)(5).


Sec.  625.5  Application procedures.

    (a) Sign-up process. As funds are available, the Chief will solicit 
project proposals from the State Conservationist. The State 
Conservationist may consult with other agencies at the State, Federal, 
and local levels to develop proposals. The State Conservationist will 
submit the proposal(s) to the Chief for funding selection. Upon 
selection for funding, the State Conservationist will issue a public 
sign-up notice which will announce and explain the rationale for 
decisions based on the following information:
    (1) The geographic scope of the sign-up;
    (2) Any additional program eligibility criteria that are not 
specifically listed in this part;
    (3) Any additional requirements that participants must include in 
their HFRP applications that are not specifically identified in this 
part;
    (4) Information on the priority order of enrollment for funding;
    (5) An estimate of the total funds NRCS expects to obligate during 
a given sign-up; and
    (6) The schedule for the sign-up process, including the deadline(s) 
for applying.
    (b) Application for participation. To apply for enrollment through 
an easement, 30-year contract, or 10-year cost-share agreement, a 
landowner must submit an application for participation in the HFRP 
during an announced period for such sign-up.
    (c) Preliminary agency actions. By filing an application for 
participation, the applicant consents to an NRCS representative 
entering upon the land for purposes of determining land eligibility, 
and for other activities that are necessary or desirable for NRCS to 
make offers of enrollment. The applicant is entitled to accompany an 
NRCS representative on any site visits.
    (d) Voluntary reduction in compensation. In order to enhance the 
probability of enrollment in HFRP, an applicant may voluntarily offer 
to accept a lesser payment than is being offered by NRCS. Such offer 
and subsequent payments may not be less than those rates set forth in 
Sec.  625.8 and Sec.  625.10 of this part.


Sec.  625.6  Establishing priority for enrollment in HFRP.

    (a) Ranking considerations. Based on the specific criteria set 
forth in a sign-up announcement and the applications for participation, 
NRCS, in coordination FWS and NMFS, may consider the following factors 
to rank properties:
    (1) Estimated conservation benefit to habitat required by 
threatened or endangered species listed under section 4 of the ESA;
    (2) Estimated conservation benefit to habitat required by species 
not listed as endangered or threatened under section 4 of the ESA but 
that are candidates for such listing, State-listed species, or species 
identified by the Chief for special consideration for funding;
    (3) Estimated improvement of biological diversity, if enrolled;

[[Page 6549]]

    (4) Potential for increased capability of carbon sequestration, if 
enrolled;
    (5) Availability of contribution of non-Federal funds;
    (6) Significance of forest ecosystem functions and values;
    (7) Estimated cost-effectiveness of the particular restoration 
cost-share agreement, contract, or easement, and associated HFRP 
restoration plan; and
    (8) Other factors identified in a HFRP sign-up notice.
    (b) NRCS may place higher priority on certain forest ecosystems 
based regions of the State or multi-State area where restoration of 
forestland may better achieve NRCS programmatic and sign-up goals and 
objectives.
    (c) Notwithstanding any limitation of this part, NRCS may enroll 
eligible lands at any time in order to encompass project areas subject 
to multiple land ownership or otherwise to achieve program objectives. 
Similarly, NRCS may, at any time, exclude otherwise eligible lands if 
the participation of the adjacent landowners is essential to the 
successful restoration of the forest ecosystem and those adjacent 
landowners are unwilling to participate.
    (d) If available funds are insufficient to accept the highest 
ranked application, and the applicant is not interested in reducing the 
acres offered to match available funding, NRCS may select a lower 
ranked application that can be fully funded. In cases where HFRP funds 
are not sufficient to cover the costs of an application selected for 
funding, the applicant may lower the cost of the application by 
changing the duration of the easement or agreement or reducing the 
acreage offered, unless these changes result in a reduction of the 
application ranking score below that of the score of the next available 
application on the ranking list.


Sec.  625.7  Enrollment of easements, contracts, and agreements.

    (a) Offers of enrollment. Based on the priority ranking, NRCS will 
notify an affected landowner of tentative acceptance into the program. 
This notice of tentative acceptance into the program does not bind NRCS 
or the United States to enroll the proposed project in HFRP, nor does 
it bind the landowner to convey an easement, or to contract or agree to 
HFRP activities. The letter notifies the landowner that NRCS intends to 
continue the enrollment process on their land unless otherwise notified 
by the landowner.
    (b) Acceptance of offer of enrollment. An agreement to purchase or 
a restoration cost-share agreement or contract will be presented by 
NRCS to the landowner which will describe the easement, agreement, or 
contract area; the easement, agreement, or contract terms and 
conditions; and other terms and conditions for participation that may 
be required by NRCS.
    (c) Effect of the acceptance of the offer. After the agreement to 
purchase or restoration cost-share agreement or contract is executed by 
NRCS and the landowner, the land will be considered enrolled in the 
HFRP. For easements, NRCS will proceed with various easement 
acquisition activities, which may include conducting a survey of the 
easement area, securing necessary subordination agreements, procuring 
title insurance, and conducting other activities necessary to record 
the easement or implement the HFRP, as appropriate for the enrollment 
option being considered. For restoration cost-share agreements and 
contracts, the landowner will proceed to implement the restoration plan 
with technical assistance and cost-share from NRCS.
    (d) Withdrawal of offers. Prior to execution of an agreement to 
purchase, a restoration cost-share agreement, or contract between the 
United States and the landowner, NRCS may withdraw the land from 
enrollment at any time due to lack of availability of funds, inability 
to clear title, or other reasons. An agreement to purchase will be 
void, and the offer withdrawn, if not executed by the landowner within 
the time specified.


Sec.  625.8  Compensation for easements and 30-year contracts.

    (a) Determination of easement payment rates.
    (1) NRCS will offer to pay not less than 75 percent, nor more than 
100 percent of the fair market value of the enrolled land during the 
period the land is subject to the easement, less the fair market value 
of the land encumbered by the easement for permanent easements or 
easements for the maximum duration allowed under State law.
    (2) NRCS will offer to pay not more than 75 percent of the fair 
market value of the enrolled land, less the fair market value of the 
land encumbered by the easement for 30-year easements or 30-year 
contracts.
    (b) Acceptance and use of contributions. NRCS may accept and use 
contributions of non-Federal funds to make payments under this section.
    (c) Acceptance of offered easement or 30-year contract 
compensation.
    (1) NRCS will not acquire any easement or 30-year contract unless 
the landowner accepts the amount of the payment that is offered by 
NRCS. The payment may or may not equal the fair market value of the 
interests and rights to be conveyed by the landowner under the easement 
or 30-year contract. By voluntarily participating in the program, a 
landowner waives any claim to additional compensation based on fair 
market value.
    (2) Payments may be made in a single payment or no more than 10 
annual payments of equal or unequal size, as agreed to between NRCS and 
the landowner.
    (d) If a landowner believes they may be eligible for a bargain sale 
tax deduction that is the difference between the fair market value of 
the easement conveyed to the United States and the easement payment 
made to the landowner, it is the landowner's responsibility to discuss 
those matters with the Internal Revenue Service. NRCS disclaims any 
representations concerning the tax implications of any easement or 
cost-share transaction.
    (e) Per acre payments. If easement payments are calculated on a per 
acre basis, adjustment to stated easement payment will be made based on 
final determination of acreage.
    (f) Ecosystem Services Credits for Conservation Improvements. USDA 
recognizes that environmental benefits will be achieved by implementing 
conservation practices and activities funded through HFRP, and that 
environmental credits may be gained as a result of implementing 
activities compatible with the purposes of a HFRP easement, 30-year 
contract, or restoration cost-share agreement. NRCS asserts no direct 
or indirect interest in these credits. However, NRCS retains the 
authority to ensure the requirements of a HFRP easement, contract, 
cost-share agreement, or restoration plan are met consistent with 
Sec. Sec.  625.9 through 625.13 of this part. Where activities required 
under an environmental credit agreement may affect land covered under a 
HFRP easement, restoration cost-share agreement, or 30-year contract, 
participants are highly encouraged to request a compatibility 
assessment from NRCS prior to entering into such agreements.


Sec.  625.9  10-year restoration cost-share agreements.

    (a) The restoration plan developed under Sec.  625.13 forms the 
basis for the 10-year cost-share agreement and its terms are 
incorporated therein.
    (b) A 10-year cost-share agreement will:
    (1) Incorporate all portions of a restoration plan;
    (2) Be for a period of 10 years;
    (3) Include all provisions as required by law or statute;

[[Page 6550]]

    (4) Specify the requirements for operation and maintenance of 
applied conservation practices;
    (5) Include any participant reporting and recordkeeping 
requirements to determine compliance with the agreement and HFRP;
    (6) Be signed by the participant;
    (7) Identify the amount and extent of cost-share assistance that 
NRCS will provide for the adoption or implementation of the approved 
conservation treatment identified in the restoration plan; and
    (8) Include any other provision determined necessary or appropriate 
by the NRCS representative.
    (c) Once the participant and NRCS have signed a 10-year cost-share 
agreement, the land will be considered enrolled in HFRP.
    (d) The State Conservationist may, by mutual agreement with the 
parties to the 10-year cost-share agreement, consent to the termination 
of the restoration agreement where:
    (1) The parties to the 10-year cost-share agreement are unable to 
comply with the terms of the restoration agreement as the result of 
conditions beyond their control;
    (2) Compliance with the terms of the 10-year cost-share agreement 
would work a severe hardship on the parties to the agreement; or
    (3) Termination of the 10-year cost-share agreement would, as 
determined by the State Conservationist, be in the public interest.
    (e) If a 10-year cost-share agreement is terminated in accordance 
with the provisions of this section, the State Conservationist may 
allow the participants to retain any cost-share payments received under 
the 10-year cost-share agreement where forces beyond the participant's 
control prevented compliance with the agreement.


Sec.  625.10  Cost-share payments.

    (a) NRCS may share the cost with landowners of restoring land 
enrolled in HFRP as provided in the HFRP restoration plan. The HFRP 
restoration plan may include periodic manipulation to maximize fish and 
wildlife habitat and preserve forest ecosystem functions and values, 
and measures that are needed to provide the Landowner Protections under 
section 7(b)(4) or section 10(a)(1) of the ESA, including the cost of 
any permit.
    (b) Landowner Protections may be made available to landowners 
enrolled in the HFRP who agree, for a specified period, to restore, 
protect, enhance, maintain, and manage the habitat conditions on their 
land in a manner that is reasonably expected to result in a net 
conservation benefit that contributes to the recovery of listed species 
under the ESA, candidate, or other species covered by this regulation. 
These protections operate with lands enrolled in the HFRP and are valid 
for as long as the landowner is in compliance with the terms and 
conditions of such assurances, any associated permit, the easement, 
contract, or the restoration agreement.
    (c) If the Landowner Protections, or any associated permit, require 
the adoption of a conservation practice or measure in addition to the 
conservation practices and measures identified in the applicable HFRP 
restoration plan, NRCS and the landowner will incorporate the 
conservation practice or measure into the HFRP restoration plan as an 
item eligible for cost-share assistance.
    (d) Failure to perform planned management activities can result in 
violation of the easement, 10-year cost-share agreement, or the 
agreement under which Landowner Protections have been provided. NRCS 
will work with landowners to plan appropriate management activities.
    (e) The amount and terms and conditions of the cost-share 
assistance will be subject to the following restrictions on the costs 
of establishing or installing NRCS approved conservation practices or 
implementing measures specified in the HFRP restoration plan:
    (1) On enrolled land subject to a permanent easement or an easement 
for the maximum duration allowed under State law, NRCS will offer to 
pay not less than 75 percent nor more than 100 percent of the average 
cost, and;
    (2) On enrolled land subject to a 30-year easement or 30-year 
contract, NRCS will offer to pay not more than 75 percent of the 
average cost.
    (f) On enrolled land subject to a 10-year cost-share agreement 
without an associated easement, NRCS will offer to pay not more than 50 
percent of the average costs.
    (g) Cost-share payments may be made only upon a determination by 
NRCS that an eligible conservation practice or measure has been 
established in compliance with appropriate standards and 
specifications. Identified conservation practices and measures may be 
implemented by the landowner or other designee.
    (h) Cost-share payments may be made for the establishment and 
installation of additional eligible conservation practices and 
measures, or the maintenance or replacement of an eligible conservation 
practice or measure, but only if NRCS determines the practice or 
measure is needed to meet the objectives of HFRP, and the failure of 
the original conservation practices or measures was due to reasons 
beyond the control of the landowner.


Sec.  625.11  Easement participation requirements.

    (a) To enroll land in HFRP through a permanent easement, an 
easement for the maximum duration allowed under State law, or 30-year 
enrollment option, a landowner will grant an easement to the United 
States. The easement deed will require that the easement area be 
maintained in accordance with HFRP goals and objectives for the 
duration of the term of the easement, including the restoration, 
protection, enhancement, maintenance, and management of habitat and 
forest ecosystem functions and values.
    (b) For the duration of its term, the easement will require, at a 
minimum, that the landowner and the landowner's heirs, successors, and 
assignees, will cooperate in the restoration, protection, enhancement, 
maintenance, and management of the land in accordance with the easement 
and with the terms of the HFRP restoration plan. In addition, the 
easement will grant to the United States, through NRCS:
    (1) A right of access to the easement area by NRCS or its 
representative;
    (2) The right to determine and permit compatible uses on the 
easement area and specify the amount, method, timing, intensity, and 
duration of the compatible use, if such use is consistent with the 
long-term protection and enhancement of the purposes for which the 
easement was established;
    (3) The rights, title, and interest to the easement area as 
specified in the conservation easement deed; and
    (4) The right to perform restoration, protection, enhancement, 
maintenance, and management activities on the easement area.
    (c) The landowner will convey title to the easement which is 
acceptable to NRCS. The landowner will warrant that the easement 
granted to the United States is superior to the rights of all others, 
except for exceptions to the title which are deemed acceptable by NRCS.
    (d) The landowner will:
    (1) Comply with the terms of the easement;
    (2) Comply with all terms and conditions of any associated 
agreement or contract;
    (3) Agree to the long-term restoration, protection, enhancement, 
maintenance, and management of the easement in accordance with the 
terms of the easement and related agreements;

[[Page 6551]]

    (4) Have the option to enter into an agreement with governmental or 
private organizations to assist in carrying out any landowner 
responsibilities on the easement area; and
    (5) Agree that each person who is subject to the easement will be 
jointly and severally responsible for compliance with the easement and 
the provisions of this part, and for any refunds or payment adjustment 
which may be required for violation of any terms or conditions of the 
easement or the provisions of this part.


Sec.  625.12  30-year contracts.

    (a) To enroll land in HFRP through the 30-year contract option, a 
landowner will sign a 30-year contract with NRCS. The contract will 
require that the contract area be maintained in accordance with HFRP 
goals and objectives for the duration of the term of the contract, 
including the restoration, protection, enhancement, maintenance, and 
management of habitat and forest ecosystem functions and values.
    (b) For the duration of its term, the 30-year contract will 
require, at a minimum, that the landowner and the landowner's 
assignees, will cooperate in the restoration, protection, enhancement, 
maintenance, and management of the land in accordance with the contract 
and with the terms of the HFRP restoration plan. In addition, the 
contract will grant to the United States through NRCS:
    (1) A right of access to the contract area by NRCS or its 
representative;
    (2) The right to allow such activities by the landowner as hunting 
and fishing, managed timber harvest, or periodic haying or grazing, if 
such use is consistent with the long-term protection and enhancement of 
the purposes for which the contract was established;
    (3) The right to specify the amount, method, timing, intensity, and 
duration of the activities listed in paragraph (b)(2) of this section, 
as incorporated into the terms of the contract; and
    (4) The right to perform restoration, protection, enhancement, 
maintenance, and management activities on the contract area.
    (c) The landowner will:
    (1) Comply with the terms of the contract;
    (2) Comply with all terms and conditions of any associated 
agreement or contract; and
    (3) Agree to the long-term restoration, protection, enhancement, 
maintenance, and management of the contract area in accordance with the 
terms of the contract and related agreements.
    (d) A 30-year contract will:
    (1) Be signed by the participant;
    (2) Identify the amount and extent of cost-share assistance that 
NRCS will provide for the adoption or implementation of the approved 
conservation treatment identified in the restoration plan; and
    (3) Include any other provision determined necessary or appropriate 
by the NRCS representative.
    (e) Once the landowner and NRCS have signed a 30-year contract, the 
land will be considered enrolled in HFRP.


Sec.  625.13  The HFRP restoration plan development and Landowner 
Protections.

    (a) The development of the HFRP restoration plan will be made 
through an NRCS representative, who will confer with the program 
participant and with the FWS and NMFS, as appropriate.
    (b) The HFRP restoration plan will specify the manner in which the 
enrolled land under easement, 30-year contract, or 10-year cost-share 
agreement will be restored, protected, enhanced, maintained, and 
managed to accomplish the goals of the program.
    (c) Eligible restoration practices and measures may include land 
management, vegetative, and structural practices and measures that will 
restore and enhance habitat conditions for listed species, candidate, 
State-listed, and other species identified by the Chief for special 
funding consideration. To the extent practicable, eligible practices 
and measures will improve biodiversity and optimize the sequestration 
of carbon through management that maintains diverse and high quality 
native forests to accomplish the goals of the restoration plan. NRCS, 
in coordination with FWS and NMFS, will determine the conservation 
practices and measures. The State Conservationist will develop and make 
available to the public a list of eligible practices, and will 
determine payment rates and cost-share percentages within statutory 
limits.
    (d) Landowner Protections. An HFRP participant who enrolls land in 
HFRP and whose conservation treatment results in a net conservation 
benefit for listed, candidate, or other species, may request such 
Landowner Protections as follows:
    (1) Incidental Take Authorization.
    (i) NRCS will extend to participants the incidental take 
authorization received by NRCS from FWS or NMFS through biological 
opinions issued as part of the interagency cooperation process under 
section 7(a)(2) of the ESA;
    (ii) NRCS will provide assurances, as a provision of the 
restoration plan, that when a participant is provided authorization for 
incidental take of a listed species, NRCS will not require management 
activities related to that species to be undertaken in addition to or 
different from those specified in the restoration plan without the 
participant's consent;
    (iii) The program participant will be covered by the authorization 
to NRCS for incidental take associated with restoration actions or 
management activities. The incidental take may include a return to 
baseline conditions at the end of the applicable period, if the 
landowner so desires.
    (iv) Provided the landowner has acted in good faith and without 
intent to violate the terms of the HFRP restoration plan, NRCS will 
pursue all appropriate options with the participant to avoid 
termination in the event of the need to terminate an HFRP restoration 
plan that is being properly implemented; and
    (v) If the 30-year contract or 10-year restoration cost-share 
agreement is terminated, any requested assurances, including an 
incidental take authorization under this section, provided by NRCS will 
be voided. As such, the landowner will be responsible to FWS or NMFS 
for any violations of the ESA.
    (2) SHA or CCAA.
    (i) NRCS will provide technical assistance to help participants 
design and use their HFRP restoration plan for the dual purposes of 
qualifying for HFRP financial assistance and as a basis for entering 
into a SHA or CCAA with FWS or NMFS and receiving an associated permit 
under section 10(a)(1)(a) of the ESA.
    (ii) In exchange for a commitment to undertake conservation 
measures, the landowner may receive a permit under section 10 of the 
ESA from FWS or NMFS authorizing incidental take of species covered by 
the SHA or CCAA that may occur as a result of restoration actions, 
management activities, and for a listed species covered by a SHA, a 
return to baseline conditions at the end of the applicable period.
    (iii) All SHAs and associated permits issued by FWS or NMFS are 
subject to the Safe Harbor Policy jointly adopted by FWS and NMFS 
according to the regulations at 64 FR 32717 or applicable subsequently 
adopted policy, and SHAs with FWS also are subject to regulations at 50 
CFR 17.22(c) for endangered species or 50 CFR 17.32(c) for threatened 
species, or applicable subsequent regulations.
    (iv) All CCAAs and associated permits issued by FWS or NMFS are 
subject to the CCAAs policy jointly adopted by FWS and NMFS according 
to the

[[Page 6552]]

regulations at 64 FR 32706 or applicable subsequently adopted policy, 
and CCAAs with FWS also are subject to regulations at 50 CFR 17.22(d) 
for endangered species or 50 CFR 17.32(d) for threatened species, or 
applicable subsequent regulations.
    (v) If the 30-year contract or 10-year restoration cost-share 
agreement is terminated, the landowner will be responsible to notify 
and coordinate with FWS and NMFS or any other relevant party to the 
specific SHA or CCAA, as appropriate, for any modifications related to 
the SHA or CCAA.


Sec.  625.14  Modification of the HFRP restoration plan.

    The State Conservationist may approve modifications to the HFRP 
restoration plan that do not modify or void provisions of the easement, 
contract, restoration agreement, or Landowner Protections, and are 
consistent with applicable law. NRCS may obtain and receive input from 
the landowner and coordinate with FWS and NMFS to determine whether a 
modification to the restoration plan is justified. Any HFRP restoration 
plan modification must meet HFRP program objectives, and must result in 
equal or greater wildlife benefits and ecological and economic values 
to the United States. Modifications to the HFRP restoration plan which 
are substantial and affect provisions of the contract, restoration 
cost-share agreement, or Landowner Protections will require agreement 
from the landowner, any relevant party to a specific SHA or CCAA, FWS, 
or NMFS, as appropriate, and may require execution of an amended 
contract or 10-year restoration cost-share agreement and modification 
to the Landowner Protection provisions.


Sec.  625.15  Transfer of land.

    (a) Offers voided prior to enrollment. Any transfer of the property 
prior to the applicant's acceptance into the program will void the 
offer of enrollment. At the option of the State Conservationist, an 
offer can be extended to the new landowner if the new landowner agrees 
to the same or more restrictive easement, agreement, and contract terms 
and conditions.
    (b) Actions following transfer of land.
    (1) For easements or 30-year contracts with multiple annual 
payments, any remaining payments will be made to the original landowner 
unless NRCS receives an assignment of proceeds.
    (2) Eligible cost-share payments will be made to the new landowner 
upon presentation of an assignment of rights or other evidence that 
title has passed.
    (3) Landowner protections will be available to the new landowner, 
and the new landowner will be held responsible for assuring completion 
of all measures and conservation practices required by the contract, 
deed, and incidental take permit.
    (4) If a SHA or CCAA is involved, the previous and new landowner 
may coordinate with FWS or NMFS, as appropriate, to transfer the 
agreement and associated permits and assurances.
    (5) The landowner and NRCS may agree to transfer a 30-year 
contract. The transferee must be determined by NRCS to be eligible to 
participate in HFRP and must assume full responsibility under the 
contract, including operation and maintenance of all conservation 
practices and measures required by the contract.
    (c) Claims to payments. With respect to any and all payments owed 
to a person, the United States will bear no responsibility for any full 
payments or partial distributions of funds between the original 
landowner and the landowner's successor. In the event of a dispute or 
claim on the distribution of cost-share payments, NRCS may withhold 
payments without the accrual of interest pending an agreement or 
adjudication on the rights to the funds.


Sec.  625.16  Violations and remedies.

    (a) Easement Violations.
    (1) In the event of a violation of the easement or any associated 
agreement involving a landowner, the landowner will be given reasonable 
notice and an opportunity to voluntarily correct the violation within 
30 days of the date of the notice, or such additional time as the State 
Conservationist determines is necessary to correct the violation.
    (2) Notwithstanding paragraph (a)(1) of this section, NRCS reserves 
the right to enter upon the easement area at any time to remedy 
deficiencies or easement violations. Such entry may be made at the 
discretion of NRCS when such actions are deemed necessary to protect 
important listed species, candidate species, and forest ecosystem 
functions and values or other rights of the United States under the 
easement. The landowner will be liable for any costs incurred by the 
United States as a result of the landowner's negligence or failure to 
comply with easement or contractual obligations.
    (3) In addition to any and all legal and equitable remedies as may 
be available to the United States under applicable law, NRCS may 
withhold any easement and cost-share payments owed to landowners at any 
time there is a material breach of the easement covenants, associated 
restoration agreement, or any associated contract. Such withheld funds 
may be used to offset costs incurred by the United States in any 
remedial actions or retained as damages pursuant to court order or 
settlement agreement.
    (4) The United States will be entitled to recover any and all 
administrative and legal costs, including attorney's fees or expenses, 
associated with any enforcement or remedial action.
    (b) 30-year Contract and 10-year Cost-Share Agreement Violations.
    (1) If NRCS determines that a participant is in violation of the 
terms of a 30-year contract, or 10-year cost-share agreement, or 
documents incorporated by reference into the 30-year contract or 10-
year cost-share agreement, the landowner will be given reasonable 
notice and an opportunity to voluntarily correct the violation within 
30 days of the date of the notice, or such additional time as the State 
Conservationist determines is necessary to correct the violation. If 
the violation continues, the State Conservationist may terminate the 
30-year contract or 10-year cost-share agreement.
    (2) Notwithstanding the provisions of paragraph (b)(1) of this 
section, a 10-year cost-share agreement or 30-year contract termination 
is effective immediately upon a determination by the State 
Conservationist that the participant has: submitted false information; 
filed a false claim; engaged in any act for which a finding of 
ineligibility for payments is permitted under this part; or taken 
actions NRCS deems to be sufficiently purposeful or negligent to 
warrant a termination without delay.
    (3) If NRCS terminates a 10-year cost-share agreement or 30-year 
contract, the participant will forfeit all rights for future payments 
under the 10-year cost-share agreement or 30-year contract, and must 
refund all or part of the payments received, plus interest, and 
liquidated damages.
    (4) When making any 30-year contract or 10-year cost-share 
agreement termination decisions, the State Conservationist may provide 
equitable relief in accordance with 7 CFR part 635.


Sec.  625.17  Payments not subject to claims.

    Any cost-share, contract, or easement payment or portion thereof 
due any person under this part will be allowed without regard to any 
claim or lien in favor of any creditor, except agencies of the United 
States Government.


Sec.  625.18  Assignments.

    Any person entitled to any cash payment under this program may 
assign

[[Page 6553]]

the right to receive such cash payments in whole or in part.


Sec.  625.19  Appeals.

    (a) A person participating in the HFRP may obtain a review of any 
administrative determination concerning eligibility for participation 
utilizing the administrative appeal regulations provided in 7 CFR parts 
11 and 614.
    (b) Before a person may seek judicial review of any administrative 
action concerning eligibility for program participation under this 
part, the person must exhaust all administrative appeal procedures set 
forth in paragraph (a) of this section, and for purposes of judicial 
review, no decision will be a final agency action except a decision of 
the Chief under these procedures.
    (c) Any appraisals, market analysis, or supporting documentation 
that may be used by NRCS in determining property value are considered 
confidential information, and will only be disclosed as determined at 
the sole discretion of NRCS in accordance with applicable law.
    (d) Enforcement actions undertaken by NRCS in furtherance of its 
federally held property rights are under the jurisdiction of the 
Federal District Court, and are not subject to review under 
administrative appeal regulations.


Sec.  625.20  Scheme and device.

    (a) If it is determined by NRCS that a person has employed a scheme 
or device to defeat the purposes of this part, any part of any program 
payment otherwise due or paid to such person during the applicable 
period may be withheld or be required to be refunded with interest 
thereon, as determined appropriate by NRCS.
    (b) A scheme or device includes, but is not limited to, coercion, 
fraud, misrepresentation, depriving any other person of payments for 
10-year cost-share agreements, contracts, or easements for the purpose 
of obtaining a payment to which a person would otherwise not be 
entitled.
    (c) A person who succeeds to the responsibilities under this part 
will report in writing to NRCS any interest of any kind in enrolled 
land that is held by a predecessor or any lender. A failure of full 
disclosure will be considered a scheme or device under this section.

    Signed this 4th day of February, 2010, in Washington, DC.
Dave White,
Chief, Natural Resources Conservation Service.
[FR Doc. 2010-2812 Filed 2-9-10; 8:45 am]
BILLING CODE 3410-16-P