73954 Federal Register / Vol. 79, No. 239 / Friday, December 12, 2014 / Rules and Regulations 

DEPARTMENT OF AGRICULTURE 

Commodity Credit Corporation 

7 CFR Part 1466 

[Docket No. NRCS–2014–0007] 

RIN 0578–AA62 

Environmental Quality Incentives 

Program (EQIP) 

AGENCY: Natural Resources 

Conservation Service and the 

Commodity Credit Corporation, United 

States Department of Agriculture. 

ACTION: Interim rule with request for 

comment. 

SUMMARY: This interim rule with request 

for comment amends the existing 

Environmental Quality Incentives 

Program (EQIP) regulation to 

incorporate programmatic changes as 

authorized by amendments in the 

Agricultural Act of 2014 (2014 Act). 

DATES: Effective Date: This rule is 

effective December 12, 2014. 

Comment Date: Submit comments on 

or before February 10, 2015. 

ADDRESSES: You may submit comments 

using one of the following methods: 

• Federal eRulemaking Portal: http:// 

www.regulations.gov. Follow the 

instructions for submitting comments 

for Docket No. NRCS–2014–0007. 

• U.S. mail or hand delivery: Public 

Comments Processing, Attn: Docket No. 

NRCS–2014–0007, Regulatory and 

Agency Policy Team, Strategic Planning 

and Accountability, U.S. Department of 

Agriculture, Natural Resources 

Conservation Service, 5601 Sunnyside 

Avenue, Building 1–1112D, Beltsville, 

MD 20705. 

NRCS will post all comments on: 

http://www.regulations.gov. Personal 

information provided with comments 

will be posted. If your comment 

includes your address, phone number, 

email address, or other personal 

identifying information, please be aware 

that your entire comment, including this 

personal information, will be made 

publicly available. Do not include 

personal information with your 

comment submission if you do not wish 

for it to be made public. 

FOR FURTHER INFORMATION CONTACT: 

Mark Rose, Director, Financial 

Assistance Programs Division, U.S. 

Department of Agriculture, Natural 

Resources Conservation Service, P.O. 

Box 2890, Washington, DC 20013–2890; 

telephone: (202) 720–1845; Fax: (202) 

720–4265. 

Persons with disabilities who require 

alternate means for communication 

(Braille, large print, audio tape, etc.) 

should contact the USDA TARGET 

Center at: (202) 720–2600 (voice and 

TDD). 

SUPPLEMENTARY INFORMATION: 

Regulatory Certifications 

Executive Order 12866 and 13563 

Executive Order 12866, ‘‘Regulatory 

Planning and Review,’’ and Executive 

Order 13563, ‘‘Improving Regulation 

and Regulatory Review,’’ directs 

agencies to assess all costs and benefits 

of available regulatory alternatives and, 

if regulation is necessary, to select 

regulatory approaches that maximize 

net benefits (including potential 

economic, environmental, public health 

and safety effects, distributive impacts, 

and equity). Executive Order 13563 

emphasizes the importance of 

quantifying both costs and benefits, of 

reducing costs, of harmonizing rules, 

and of promoting flexibility. Upon 

implementation of this rule the Natural 

Resources Conservation Service intends 

to conduct a retrospective review of this 

rule with the purpose of improving 

program performance, and better 

understanding the longevity of 

conservation implementation. 

The Office of Management and Budget 

(OMB) designated this interim rule with 

request for comment a significant 

regulatory action. The administrative 

record is available for public inspection 

at the U.S. Department of Agriculture, 

Natural Resources Conservation Service, 

Room 5831 South Building, 1400 

Independence Avenue SW., 

Washington, DC 20250–2890. Pursuant 

to Executive Order 12866, NRCS 

conducted an economic analysis of the 

potential impacts associated with this 

program. A summary of the economic 

analysis can be found at the end of the 

regulatory certifications section of this 

preamble, and a copy of the analysis is 

available upon request from the 

Director, Financial Assistance Programs 

Division, U.S. Department of 

Agriculture, Natural Resources 

Conservation Service, 1400 

Independence Avenue SW., Room 5237 

South Building, Washington, DC 20250– 

2890 or electronically at: http://www.

nrcs.usda.gov/programs/eqip/ under the 

EQIP Rules and Notices with Supporting 

Documents title. 

Executive Order 12866, as 

supplemented by Executive Order 

13563, requires each agency to write all 

rules in plain language. In addition to 

your substantive comments on this 

interim rule, we invite your comments 

on how to make the provisions easier to 

understand. For example: 

• Are the requirements in the rule 

clearly stated? Are the scope and intent 

of the rule clear? 

• Does the rule contain technical 

language or jargon that is not clear? 

• Is the material logically organized? 

• Would changing the grouping or 

order of sections or adding headings 

make the rule easier to understand? 

• Could we improve clarity by adding 

tables, lists, or diagrams? 

• Would more, but shorter, sections 

be better? Are there specific sections 

that are too long or confusing? 

• What else could we do to make the 

rule easier to understand? 

Regulatory Flexibility Act 

The Regulatory Flexibility Act (5 

U.S.C. 601–612) (RFA) generally 

requires an agency to prepare a 

regulatory flexibility analysis of any rule 

subject to notice and comment 

rulemaking requirements under the 

Administrative Procedure Act or any 

other statute. NRCS did not prepare a 

regulatory flexibility analysis for this 

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. Even so, NRCS has 

determined that this action, while 

mostly affecting small entities, will not 

have a significant economic impact on 

a substantial number of these small 

entities. NRCS made this determination 

based on the fact that this regulation 

only impacts those who choose to 

participate in the program. Small entity 

applicants will not be affected to a 

greater extent than large entity 

applicants. 

Congressional Review Act 

Section 1246(c) of the Food Security 

Act of 1985 (the 1985 Act), as amended 

by Section 2608 of the Agricultural Act 

of 2014, requires that the Secretary use 

the authority in section 808(2) of title 5, 

United States Code, which allows an 

agency to forego Congressional Review 

Act usual 60-day Congressional Review 

delay of the effective date of a major 

regulation if the agency finds that there 

is a good cause to do so. NRCS hereby 

determines that it has good cause to do 

so in order to meet the Congressional 

intent to have the conservation 

programs, authorized or amended under 

Title XII of the 1985 Act, in effect as 

soon as possible. NRCS also determined 

it has good cause to forgo delaying the 

effective date given the critical need to 

let agricultural producers know what 

programmatic changes are being made 

so that they can make financial plans 

accordingly prior to planting season. For 

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Federal Register / Vol. 79, No. 239 / Friday, December 12, 2014 / Rules and Regulations 73955 

these reasons, this rule is effective upon 

publication in the Federal Register. 

Environmental Analysis 

NRCS has prepared a programmatic 

Environmental Assessment (EA) in 

association with the EQIP rulemaking to 

aid in its compliance with the National 

Environmental Policy Act when 

implementing site-specific actions with 

EQIP funds (40 CFR 1501.3(b)). The 

analysis has determined that there will 

not be a significant impact to the human 

environment and as a result, an 

Environmental Impact Statement is not 

required to be prepared (40 CFR 

1508.13). The EA and Finding of No 

Significant Impact (FONSI) are available 

for review and comment for 30 days 

from the date of publication of this 

interim rule in the Federal Register. 

NRCS will consider this input and 

determine whether there is any new 

information provided that is relevant to 

environmental concerns and bearing on 

the proposed action or its impacts that 

warrant supplementing or revising the 

current available draft of the EQIP EA 

and FONSI. A copy of the EA and 

FONSI may be obtained from the 

following Web site: http:// 

www.nrcs.usda.gov/ea. A hard copy 

may also be obtained in one of the 

following ways: (1) Send an email to 

andree.duvarney@wdc.usda.gov with 

‘‘Request for EA’’ in the subject line, or 

(2) mail a written request to: National 

Environmental Coordinator, Natural 

Resources Conservation Service, 

Ecological Sciences Division, P.O. Box 

2890, Washington, DC 20013–2890. 

Comments on the environmental 

analysis from the public should be 

specific and reference that comments 

provided are on the EQIP EA and 

FONSI. Public comment on the 

environmental analysis only may be 

submitted by any of the following 

means: (1) Email comments to 

andree.duvarney@wdc.usda.gov, (2) go 

to http://www.regulations.gov and 

follow the instructions for submitting 

comments for Docket No. NRCS–2014– 

0007, or (3) mail written comments to: 

National Environmental Coordinator, 

Natural Resources Conservation Service, 

Ecological Sciences Division, P.O. Box 

2890, Washington, DC 20013–2890. 

Civil Rights Impact Analysis 

NRCS has determined through a Civil 

Rights Impact Analysis that the interim 

rule discloses no disproportionately 

adverse impacts for minorities, women, 

or persons with disabilities. The 

national target of setting aside 5 percent 

of EQIP funds for socially disadvantaged 

farmers or ranchers and an additional 5 

percent of EQIP funds for beginning 

farmers or ranchers; and prioritizing 

veterans that are socially disadvantaged 

farmers or ranchers and beginning 

farmer or ranchers is expected to 

increase participation among these 

groups. 

The data presented in the Civil Rights 

Impact Analysis indicate 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 

conclude that EQIP will continue to be 

administered in a nondiscriminatory 

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 U.S. 

Department of Agriculture (USDA) 

programs. NRCS conservation programs 

apply to all persons equally regardless 

of their race, color, national origin, 

gender, sex, or disability status. 

Therefore, this interim rule portends no 

adverse civil rights implications for 

women, minorities, and persons with 

disabilities. 

Paperwork Reduction Act 

Section 1246 of the Food Security Act 

of 1985 (the 1985 Act), as amended by 

the Agricultural Act of 2014 (2014 Act), 

requires that implementation of 

programs authorized by Title XII of the 

1985 Act be made without regard to the 

Paperwork Reduction Act of 1995 (44 

U.S.C. 3501 et seq.). Therefore, NRCS is 

not reporting recordkeeping or 

estimated paperwork burden associated 

with this interim rule. 

Government Paperwork Elimination Act 

NRCS is committed to compliance 

with the Government Paperwork 

Elimination Act and the Freedom to EFile 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. To better accommodate public 

access, NRCS has developed an online 

application and information system for 

public use. 

Executive Order 13175 

This interim rule has been reviewed 

in accordance with the requirements of 

Executive Order 13175, Consultation 

and Coordination with Indian Tribal 

Governments. Executive Order 13175 

requires Federal agencies to consult and 

coordinate with Tribes on a 

government-to-government basis on 

policies that have Tribal implications, 

including regulations, legislative 

comments or proposed legislation, and 

other policy statements or actions that 

may have substantial direct effects on: 

(1) One or more Indian Tribes, (2) the 

relationship between the Federal 

Government and Indian Tribes, or (3) 

the distribution of power and 

responsibilities between the Federal 

Government and Indian Tribes. NRCS 

has assessed the impact of this interim 

rule on Indian Tribes and determined 

that this rule does not have Tribal 

implications that require Tribal 

consultation under E.O. 13175. The rule 

neither imposes substantial direct 

compliance costs on Tribal governments 

nor preempts Tribal law. The agency 

has developed an outreach/

collaboration plan that it will 

implement as it develops its Farm Bill 

policy. If a Tribe requests consultation, 

NRCS will work with the USDA Office 

of Tribal Relations to ensure meaningful 

consultation is provided where changes, 

additions, and modifications identified 

herein are not expressly mandated by 

Congress. 

Unfunded Mandates Reform Act of 1995 

Title II of the Unfunded Mandates 

Reform Act of 1995 (UMRA) (2 U.S.C. 

1531–1538) requires Federal agencies to 

assess the effects of their regulatory 

actions on State, local, and Tribal 

governments or the private sector of 

$100 million or more in any one year. 

When such a statement is needed for a 

rule, section 205 of the UMRA requires 

agencies to prepare a written statement, 

including a cost benefit assessment, for 

proposed and final rules with ‘‘Federal 

mandates’’ that may result in such 

expenditures for State, local, or Tribal 

governments, in the aggregate, or to the 

private sector. UMRA generally requires 

agencies to consider alternatives and 

adopt the more cost effective or least 

burdensome alternative that achieves 

the objectives of the rule. 

This rule contains no Federal 

mandates, as defined under Title II of 

the UMRA, for State, local, and Tribal 

governments or the private sector. 

Therefore, a statement under section 

202 of the UMRA is not required. 

Executive Order 13132 

NRCS has considered this interim rule 

in accordance with Executive Order 

13132, issued August 4, 1999. NRCS has 

determined that the interim rule 

conforms with the Federalism 

principles set out in this 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 

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73956 Federal Register / Vol. 79, No. 239 / Friday, December 12, 2014 / Rules and Regulations 

the States, or on the distribution of 

power and responsibilities among the 

various levels of government. Therefore, 

NRCS concludes that this interim rule 

does not have Federalism implications. 

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), USDA has estimated 

that this regulation will not have an 

annual impact on the economy of 

$100,000,000 in 1994 dollars, and 

therefore, is not a major regulation. 

Therefore, a risk analysis was not 

conducted. 

Executive Order 13211 

This rule is not a significant 

regulatory action subject to Executive 

Order 13211, Energy Effects. 

Registration and Reporting 

Requirements of the Federal Funding 

and Transparency Act of 2006 

OMB published two regulations, 

codified at 2 CFR part 25 and 2 CFR part 

170, to assist agencies and recipients of 

Federal financial assistance in 

complying with the Federal Funding 

Accountability and Transparency Act of 

2006 (FFATA) (Pub. L. 109–282, as 

amended). Both regulations have 

implementation requirements effective 

as of October 1, 2010. 

The regulations at 2 CFR part 25 

require, with some exceptions, 

recipients of Federal financial assistance 

to apply for and receive a Dun and 

Bradstreet Universal Numbering 

Systems (DUNS) number and register in 

the Central Contractor Registry (CCR). 

The regulations at 2 CFR part 170 

establish new requirements for Federal 

financial assistance applicants, 

recipients, and subrecipients. The 

regulation provides standard wording 

that each agency must include in its 

awarding of financial assistance that 

requires recipients to report information 

about first-tier subawards and executive 

compensation under those awards. 

NRCS has determined that 2 CFR part 

25 and 2 CFR part 170 applies to EQIP 

financial assistance provided to entities. 

Therefore, NRCS has incorporated, by 

reference, these registration and 

reporting requirements into the EQIP 

regulations and will continue to include 

the requisite provisions as part of its 

financial assistance contracts. 

Regulatory Impact Analysis—Executive 

Summary 

Pursuant to Executive Order 12866, 

Regulatory Planning and Review, NRCS 

has conducted a Regulatory Impact 

Analysis (RIA) of the Environmental 

Quality Incentives Program (EQIP) as 

pursuant to the changes of the 2014 Act. 

In considering alternatives for 

implementing EQIP, USDA followed the 

legislative intent to maximize beneficial 

conservation impacts, address natural 

resource concerns, establish an open 

participatory process, and provide 

flexible assistance to producers who 

apply appropriate conservation 

measures to comply with Federal State, 

and Tribal environmental requirements. 

Because EQIP is a voluntary program, 

the program will not impose any 

obligation or burden upon agricultural 

producers who choose not to 

participate. The program has been 

authorized by the Congress at $8 billion 

over the 5-year period beginning in 

fiscal years (FY) 2014 through 2018, 

with annual amounts of $1.35 billion in 

FY 2014, $1.60 billion in FY 2015, $1.65 

billion in FY 2016, $1.65 billion in FY 

2017, and $1.75 billion in FY 2018. The 

program had been previously authorized 

with annual amounts of $1.200 billion 

for FY 2008, $1.337 billion in FY 2009, 

$1.450 billion in FY 2010, $1.589 billion 

in FY 2011, and $1.750 billion in FY 

2012 through FY 2014. Despite this 

authorization EQIP received only $6.2 

billion in funding over the five-year 

period from FY2009–FY2013. Funds 

received annually over this period were 

$1.05 billion in FY 2009, $1.18 billion 

in FY 2010, $1.24 billion in FY 2011, 

$1.38 billion in FY 2012 and $1.29 

billion in FY 2013. The 1985 Act, as 

amended by 2014 Act, makes several 

changes to EQIP. Please note, since 

EQIP is funded with CCC funds and not 

appropriated funds, NRCS uses the term 

‘‘obligational cap’’ in the Regulatory 

Analysis to identify the funding limits 

that were placed on EQIP imposed by 

various appropriations acts. 

The changes include consolidating 

elements of the former Wildlife Habitat 

Incentives Program (WHIP) into EQIP, 

expanding participation among military 

veteran farmers or ranchers, requiring 

that funds provided in advance that are 

not expended during the 90-day period 

beginning on the date of receipt of funds 

be returned, establishing an overall 

payment limitation over fiscal years 

2014–2018 of $450,000, providing that 

EQIP funding authorized by the 2014 

Act remains available until expended, 

and requiring that at least 5 percent of 

available EQIP funds to be targeted for 

wildlife conservation practices for each 

fiscal year 2014–2018. This 5 percent for 

wildlife habitat practices is based upon 

the total EQIP funding allocated as 

financial assistance available nationally 

for producer contracts. Based upon 

historical expenditures of wildliferelated practices in both WHIP and 

EQIP, and with emphasis to prioritize 

funding applications that address 

wildlife resource concerns, the agency 

anticipates that the actual funding 

associated with developing wildlife 

habitat through EQIP will exceed the 5 

percent national target mandated by 

statute. NRCS monitors this funding 

target throughout the fiscal year and 

will reallocate funding if determined 

necessary to ensure the mandatory 

target is met. There are 7 percent of 

EQIP funds also available for eligible 

Regional Conservation Partnership 

Program (RCPP) contracts. Additional 

explanation regarding funding pools 

and EQIP program priorities is provided 

in the ‘‘Background’’ section of the 

Preamble. 

EQIP technical and financial 

assistance facilitates the adoption of 

conservation practices that address 

natural resource concerns. Those 

practices improve on-site resource 

conditions and produce offsite 

environmental benefits for the public. 

Water erosion conservation practices 

reduce the flow of pollutants off of 

fields, thus improving freshwater and 

marine water quality including 

protecting fish habitat, enhancing 

aquatic recreation opportunities, and 

reducing sedimentation of reservoirs, 

streams, and drainage channels. More 

efficient irrigation practices conserve 

scarce water, making it available for 

other uses. Wind erosion control 

practices improve air quality, and some 

practices increase carbon in the soil 

profile. Wildlife habitat conservation 

practices increase wildlife habitat, 

enhance scenic value, and provide 

opportunities for recreation. NRCS has 

added and adopted a definition for 

habitat development to encompass the 

conservation practices that support the 

wildlife habitat activities authorized by 

Section 1240B(g) by the 2014 Act. The 

term, originally defined in the WHIP 

regulation, is added to EQIP at 1466.3 

‘‘Definitions’’. The definition, consistent 

with the EQIP authority to assist with 

implementation of conservation 

practices which include the specific 

technical purpose of habitat 

development, provides for the 

conservation of wildlife species. 

Other impacts of conservation 

practices may accrue to the producer. 

For example, the maintenance of the 

long-term productivity of the land, 

improved irrigation efficiency, 

improved grazing productivity, more 

efficient crop use of animal waste and 

fertilizer, and increased profits from 

energy conservation. 

Most of this rule’s impacts consist of 

transfer payments from the Federal 

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Federal Register / Vol. 79, No. 239 / Friday, December 12, 2014 / Rules and Regulations 73957 

1Public costs include total technical assistance 

(TA) and financial assistance (FA) funds outlined 

in the Congressional Budget Office’s (CBO) scoring of the 2014 Act. Private costs are out-of-pocket costs 

paid voluntarily by participants. 

government to producers. While those 

transfers create incentives that very 

likely cause changes in the way society 

uses its resources, we lack data with 

which to quantify the resulting social 

costs or benefits. Given the existing 

limitation and lack of data, NRCS will 

investigate ways to quantify the 

incremental benefits obtained from this 

program. Despite the limitations on our 

ability to quantify and estimate the 

value of social costs or benefits from the 

implementation of conservation 

practices, EQIP as amended under the 

2014 Act is expected to positively affect 

natural resources and mitigate 

environmental degradation. Results 

from the national Conservation Effects 

Assessment Project conducted by NRCS 

demonstrate that implementation of the 

types of conservation practices funded 

under EQIP reduce sediment and 

nutrient loss from agricultural fields and 

improve water quality nationwide. 

Because data is limited on the natural 

resource impact from the EQIP program, 

NRCS seeks public comment on how the 

agency should estimate the public value 

of conservation resulting from 

assistance provided through EQIP. 

The Agriculture Act of 2014 increases 

EQIP funding over the amount 

appropriated by Congress over the 

previous five-year period from FY 2009– 

FY2013 by 29 percent to $8.0 billion. It 

is estimated that the conservation 

practices implemented with this 

funding will continue to contribute to 

reductions of water erosion and wind 

erosion on cropland, pasture and 

rangeland, reduce nutrient losses to 

streams, rivers, lakes and estuaries 

increase wildlife habitat, and provide 

other private and public environmental 

benefits. It is also expected that 

continued implementation of practices 

which treat and manage animal waste 

through EQIP will directly contribute to 

improvements in water quality and 

associated improvements in air quality, 

for example, from reduction in 

emissions such as methane. These and 

other practices include secondary 

benefits that help sequester carbon and 

capture greenhouse gases which 

contribute to climate change. NRCS 

estimates that the cost,1 from both 

public and private sources, of 

implementing the conservation 

practices with EQIP funding will be 

$11.9 billion dollars (FY 2014–FY 

2018). Cost estimates are presented in 

Table 1 below. 

TABLE 1—PROJECTED TECHNICAL ASSISTANCE AND TRANSFER PAYMENTS, FY 2014–FY 2018 1

NRCS 

technical 

assistance 

(million $) 

Transfer 

payment 

(million $) 

Public costs 

(million $) 

Private costs 

(million $) 

Total costs 

(million $) 

FY 2014 ............................................................................... 364.5 985.5 1,350.0 657.4 2,007.4 

FY 2015 ............................................................................... 432.0 1,168.0 1,600.0 779.2 2,379.2 

FY 2016 ............................................................................... 445.5 1,204.5 1,650.0 803.6 2,453.6 

FY 2017 ............................................................................... 445.5 1,204.5 1,650.0 803.6 2,453.6 

FY 2018 ............................................................................... 472.5 1,277.5 1,750.0 852.2 2,602.2 

Total .............................................................................. 2,160.0 5,840.0 8,000.0 3,896.0 11,896.0 

1Based on a historical average participant cost share of 40 percent and a historical average technical assistance share of 27 percent. 

RIA Conclusions 

Program features of EQIP except for 

the increase in wildlife focus remain 

essentially unchanged from the 2008 

Farm Bill. The increased funding over 

the period of FY 2014 to FY 2018 will 

increase the amount of conservation 

applied by agricultural producers to 

support continued improvement in the 

natural resource base—soil, water, air, 

and wildlife; and mitigate agriculture’s 

potentially adverse effects on the 

environment. The statutory requirement 

that at least 5 percent of available EQIP 

funding be targeted to practices which 

address wildlife habitat will be met by 

focusing a portion of the funding on 

applications that address wildlife 

resource concerns. 

Comments Invited 

NRCS invites interested persons to 

participate in this rulemaking by 

submitting written comments or views 

about the changes made by this interim 

rule. The most helpful comments 

reference a specific portion of the 

regulation, explain the reason for any 

recommended changes, and include 

supporting data and references to 

statutory language. All comments 

received on or before the closing date 

for comments will be considered. This 

regulation may be changed because of 

the comments received. The docket and 

associated comments, including any 

personal information provided, will be 

made available for public inspection at: 

www.regulations.gov. 

Background 

The Agricultural Act of 2014 (2014 

Act) has reauthorized and amended the 

Environmental Quality Incentives 

Program (EQIP). EQIP is implemented 

under the general supervision and 

direction of the Chief of NRCS, who is 

a Vice President of the Commodity 

Credit Corporation (CCC). 

Through EQIP, NRCS provides 

assistance to agricultural producers to 

conserve and enhance soil, water, air, 

plants, animals (including wildlife), 

energy and related natural resources on 

their land. Eligible lands include 

cropland, grassland, rangeland, pasture, 

wetlands, nonindustrial private forest 

land, and other agricultural land on 

which agricultural or forest-related 

products or livestock are produced and 

natural resource concerns may be 

addressed. Participation in the program 

is voluntary. 

The information below demonstrates 

how NRCS provides assistance through 

EQIP to enhance natural resources. The 

type of assistance NRCS provides 

includes: 

• Technical and financial assistance 

to help producers change tillage 

practices that enhance soil resources by 

sustaining tilth, moisture control, 

nutrients and overall soil health. 

• assistance to replace or improve the 

management of irrigation systems to 

conserve scarce water resources. EQIP is 

also used to help producers manage 

nutrient applications to protect water 

quality. 

• assistance with managing grazing to 

assure adequate forage is available and 

to sustain plant biodiversity and protect 

rare species. These practices help 

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maintain watershed health and enhance 

water quality. 

• assistance to help producers apply 

energy efficient practices that reduce 

energy consumption (e.g., reduced 

tillage conserves fuel, energy efficient 

lighting). 

• assistance to help producers 

implement conservation practices that 

sequester carbon or capture methane 

emissions and greenhouse gases which 

contribute to climate change. 

• assistance to help producers 

implement over 160 conservation 

practices on their land to sustain and 

improve the health of natural resources 

and provide public benefits. 

Under EQIP, NRCS provides technical 

and financial assistance to implement 

conservation practices in a manner that 

promotes agricultural production, forest 

management, and environmental quality 

as compatible goals; optimize 

conservation benefits; and help 

agricultural producers meet Federal, 

State, and local environmental 

requirements. Conservation benefits are 

reflected in the differences between 

anticipated effects of treatment in 

comparison to existing or benchmark 

conditions. Differences may be 

expressed by narrative, quantitative, 

visual, or other means. Estimated or 

projected impacts are used as a basis for 

making informed conservation decisions 

by applicants and NRCS to help 

determine which projects to approve for 

EQIP assistance. While NRCS currently 

lacks data with which to quantify the 

impacts, it will investigate ways to 

quantify the incremental benefits 

obtained from this program. 

NRCS first allocated $130 million in 

EQIP funds in 1996. Since the program 

began through fiscal year (FY) 2013, 

NRCS has entered into 559,275 

contracts to provide over $9.8 billion in 

financial assistance to help agricultural 

producers apply conservation practices. 

The agency has evaluated 18 years of 

program implementation and has 

assessed opportunities to improve 

program administration. The changes in 

this interim rule are the result of this 

evaluation and the statutory changes 

authorized by the 2014 Act. 

Section 2203 of the 2014 Act 

consolidated the Wildlife Habitat 

Incentive Program (WHIP) purposes into 

EQIP by revising section 1240B(f) and 

(g) of the EQIP statute to authorize at 

least 5 percent of program payments for 

practices targeted to benefit wildlife 

habitat, including conservation 

practices that support the restoration, 

development, and improvement of 

wildlife habitat on eligible land. 

The EQIP statute requires the agency 

to the greatest extent practicable, to 

group applications of similar crop or 

livestock operations for evaluation 

purposes or otherwise evaluate 

applications relative to other 

applications for similar farming 

operations. NRCS utilizes funding pools 

to meet this requirement and to target 

EQIP funding to priority resource 

concerns such as for the development of 

wildlife habitat or for water quality 

issues associated with animal feeding 

operations. Based upon priorities 

established with recommendations by 

State Technical Committees, priorities 

identified in state, regional or national 

plans and initiatives, and from reports 

of at-risk wildlife species and 

designations of threatened or 

endangered species, State 

Conservationists allocate available 

funds to a funding pool where 

applications from eligible producers 

compete. 

Each application submitted for 

consideration in a given funding pool is 

ranked using evaluation criteria which 

provide a relative score that reflects the 

expected environmental benefit of the 

proposed project. State Conservationists 

also have the authority to prioritize 

applications for ranking which results 

in only the highest priority applications 

being ranked and considered for 

funding. Applications are accepted from 

producers on a continuous basis; 

however NRCS announces funding cutoff deadlines where all ranked 

applications within a funding pool are 

considered for funding based upon the 

ranking scores and availability of funds. 

Nearly all funding pools are established 

each fiscal year to address identified 

resource priorities, have multiple 

applicants to compete for limited 

funding, and meet legislative intent to 

address priority issues in a cost effective 

process. Each fiscal year, State 

Conservationists publish program 

priorities, available funding pools and 

associated ranking criteria to State 

program Web sites available at: http://

www.nrcs.usda.gov/wps/portal/nrcs/

sitenav/national/states/. State 

Conservationists are required to allocate 

funds to each application pool and may 

adjust funding between pools to address 

shortages or to redistribute surplus 

funds. Legislatively created funding 

levels such as the requirement to 

provide at least 60% of the funding for 

livestock and 5% of the funding for 

wildlife, are met as national goals 

through funding pool opportunities 

established by State Conservationists. 

The changes made by the 2014 Act 

include, but are not limited to: 

• Eliminating the requirement that 

contract must remain in place for a 

minimum of one year after last practice 

implemented, but keeps the requirement 

that the contract term is not to exceed 

ten years; 

• Consolidating elements of WHIP 

into EQIP and repeals WHIP authority, 

and establishing for each year of FY 

2014 to FY 2018 that at least 5 percent 

of available EQIP funds will be targeted 

for wildlife-related conservation 

practices; 

• Replacing rolling six-year payment 

limitation with payment limitation for 

FY 2014 to FY 2018; 

• Requiring Conservation Innovation 

Grants (CIG) reporting no later than 

December 31, 2014, and every two years 

thereafter; 

• Establishing the payment limitation 

at $450,000 and eliminates the payment 

limitation waiver authority; 

• Modifying the special rule for 

foregone income payments for certain 

associated management practices and 

resource concern priorities; 

• Increasing the advance payments 

available to eligible historically 

underserved participants to purchase 

material or contract services from 30 

percent to up to 50 percent; 

• Providing flexibility for repayment 

of advance payment if not expended 

within 90 days; 

• Authorizing funding for EQIP at: 

Æ $1,350,000,000 for FY 2014 

Æ $1,600,000,000 for FY 2015 

Æ $1,650,000,000 for FY 2016 

Æ $1,650,000,000 for FY 2017 

Æ $1,750,000,000 for FY 2018 

• Providing that EQIP funding 

remains available until expended. 

The fundamental purpose of the 

program, assisting agricultural 

producers to implement conservation 

practices to provide environmental 

benefits, has not changed. Revisions to 

the program have focused primarily on 

expanding participation among 

historically underserved populations, 

including special priority for beginning 

agricultural producers and socially 

disadvantaged producers with 

preference provided under these special 

priorities for individuals who are 

veteran farmers or ranchers. The interim 

rule adjusts the program regulations to 

correspond to new statutory language. It 

also includes changes to streamline 

program implementation and make the 

participant’s contract responsibilities 

clearer and more transparent. NRCS is 

also removing definitions for terms that 

are not used in the regulation and 

making other editorial adjustments. 

Summary of Changes to EQIP Made by 

the 2014 Act 

The regulation is organized into three 

subparts: Subpart A—General 

Provisions; Subpart B—Contracts; and 

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Subpart C—General Administration. 

The basic structure of the regulation has 

not changed; however, NRCS is moving 

the sections related to conservation 

practices and technical service 

providers (TSP) to Subpart A from 

Subpart B. Below is a summary of the 

changes made to each subpart based on 

the changes made to EQIP by the 2014 

Act. 

Part 1466, Subpart A—General 

Provisions 

Section 1466.1, ‘‘Applicability,’’ sets 

forth the purpose, scope, and objectives 

of EQIP. Pursuant to section 2208 of the 

2014 Act, the interim rule updates 

§ 1466.1 to clarify those eligible program 

applicants and applicable regulations 

for contracts enrolled in EQIP prior to 

the effective date of the 2014 Act are not 

impacted by changes made by the act. 

Section 1466.2, ‘‘Administration,’’ 

describes the roles of NRCS, State 

Technical Committees, and local 

working groups. The 2014 Act 

amendments did not affect the 

regulatory provisions at § 1466.2. 

However, NRCS added reference to 

Tribal Conservation Advisory Councils 

as a contributor to the locally led 

conservation effort. 

The 2014 Act identifies EQIP as a 

covered program under the Regional 

Conservation Partnership Program 

(RCPP) authorized by Subtitle I of Title 

XII of the 1985 Act and authorizes the 

Chief to waive nonstatutory 

discretionary provisions and operational 

procedures where the Chief determines 

the waiver will further the purposes of 

EQIP. RCPP operates through the 

authority of other NRCS conservation 

programs and provides specific 

authority for NRCS to adjust 

nonstatutory discretionary provisions. 

Therefore, NRCS is adding language to 

this section of the CFR to incorporate 

these changes. This language is needed 

to facilitate RCPP implementation using 

EQIP in RCPP partner project areas. 

Section 1466.3, ‘‘Definitions,’’ sets 

forth definitions for terms used 

throughout this regulation. NRCS is 

amending several definitions to conform 

to the 2014 Act amendments, including 

the consolidation of WHIP, and to 

address other administrative matters. 

Specifically, this interim rule amends 

§ 1466.3 by adding or modifying the 

following definitions: ‘‘Conservation 

benefit’’ means ‘‘the improved condition 

of a natural resource concern resulting 

from the implementation of a 

conservation practice.’’ 

NRCS amends the definitions of 

‘‘producer’’ and ‘‘applicant’’ to remove 

an incorrect citation. In the interim rule 

published January 15, 2009, NRCS 

amended the definition of ‘‘applicant’’ 

to include the Food, Conservation, and 

Energy Act of 2008’s (2008 Act) 

terminology but kept the reference to an 

‘‘agricultural or forestry operation as 

defined in part 1400 of this chapter.’’ 

The definition of ‘‘producer’’ is clarified 

and revised to remove reference to 7 

CFR part 1400. 

‘‘Producer’’ means a person, legal 

entity, Indian Tribe, or joint operation 

who NRCS determines is engaged in 

agricultural production or forestry 

management on the agricultural 

operation. 

‘‘Applicant’’ means a producer who 

has requested in writing to participate 

in EQIP. 

NRCS amends the definition of ‘‘atrisk species’’ to incorporate the 

definition used in the WHIP regulation 

at 7 CFR 636.3. 

NRCS adds and defines the new term, 

‘‘veteran farmer or rancher,’’ consistent 

with the definition in section 2501(e) of 

the Food, Agriculture, Conservation, 

and Trade Act of 1990 (7 U.S.C. 

2279(e)). 

NRCS amends the term ‘‘National 

Organic Program’’ to include the 

reference to the Organic Foods 

Production Act of 1990 (7 U.S.C. 6501 

et seq.). The 2014 Act combined the 

statutory definition of the National 

Organic Program into the statutory 

definition of ‘‘organic system plan’’ by 

adding the statutory reference to the 

definition of ‘‘organic system plan’’ and 

removing the separate definition. NRCS 

maintains the separate definition for the 

National Organic Program in the 

regulation for clarification purposes. 

NRCS amends the term ‘‘organic 

system plan’’ to incorporate the 

statutory reference to the Organic Foods 

Production Act of 1990 (7 U.S.C. 6501 

et seq.). The organic system plan is 

defined as a management plan for 

organic production or for an organic 

handling operation that has been agreed 

to by the producer or handler and the 

certifying agent. The organic system 

plan includes written plans concerning 

all aspects of agricultural production or 

handling. 

NRCS also adds a definition for 

‘‘wildlife habitat’’ to more fully 

incorporate WHIP purposes into EQIP 

implementation. This new definition 

corresponds with the definition of 

‘‘wildlife habitat’’ used at 7 CFR part 

636. 

Section 1466.6, ‘‘Program 

Requirements,’’ (previously numbered 

§ 1466.8) sets forth land and applicant 

eligibility and the amount of EQIP 

funding to be used for livestock 

production and historically underserved 

producers. NRCS updates § 1466.6 

consistent with the updates made to the 

definitions at § 1466.3. 

Paragraphs (d) and (e), which address 

funding thresholds, have been removed. 

The funding threshold that at least 60 

percent of EQIP assistance be targeted to 

conservation practices related to 

livestock production and the 5 percent 

funding pool for beginning farmers or 

ranchers and socially disadvantaged 

farmers or ranchers are established by 

statute and are binding requirements 

upon the NRCS. Agency policy requires 

NRCS State Conservationists to establish 

at least one funding pool for eligible 

beginning farmers or ranchers and one 

funding pool for socially disadvantaged 

farmers or ranchers. This allows 

applicants meeting these requirements 

to compete for EQIP funds separately 

from all other program opportunities. 

Thus, regulatory provisions are not 

necessary in order to give these 

provisions effect. Similarly, the 2014 

Act requires that at least 5 percent of 

EQIP assistance be targeted towards 

conservation practices with a specific 

purpose related to wildlife habitat. 

NRCS will track this new funding 

requirement by identifying in its 

contract data base those conservation 

practices where wildlife habitat is the 

primary purposes. Out of more than 160 

existing conservation practice 

standards, 16 have wildlife habitat as a 

primary purpose and approximately 

another 45 standards are often used to 

benefit wildlife. Examples of standards 

with a primary wildlife focus include: 

• Early Successional Habitat 

Development/Management—used for 

early successional species such as the 

Golden Winged Warbler or New 

England Cottontail. This practice 

standard includes planting and 

vegetation management. 

• Wetland Restoration—used to 

develop habitat for the variety of 

wetland-dependent species, from 

amphibians to migratory waterbirds. 

This practice standard includes 

structural, grading, planting, and water 

management. 

• Stream Habitat Improvement and 

Management—used for many aquatic 

species, including salmon. This practice 

standard includes instream work such 

as building redds, pools and riffles, 

establishing woody debris, and 

vegetation management. 

• Upland Wildlife Habitat 

Management—used often in a system of 

practices for a wide variety of terrestrial 

species. Often, NRCS adds this 

conservation practice to a conservation 

plan to ensure other practices (e.g., 

fence) are wildlife-friendly. 

Additionally, other practices are used 

in certain situations to accomplish 

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specific wildlife objectives. Reducing 

sedimentation often improves aquatic 

habitat. Pasture and hay land planting, 

fencing, and ponds can provide 

recreational benefits (Smith, 1996). The 

NRCS Prescribed Grazing (528) 

conservation practice standard is 

essential in facilitating the development 

and maintenance of habitat to benefit 

the lesser prairie-chicken, and the 

Gunnison sage grouse, both listed as 

threatened under the Endangered 

Species Act. Every plan developed by 

NRCS under either the Lesser Prairie 

Chicken Initiative or the Sage Grouse 

Initiative, where grazing will occur, 

requires the use of Prescribed Grazing. 

To accommodate situations such as this, 

the Chief may also evaluate additional 

conservation practices related to NRCS 

landscape wildlife initiatives in 

determining whether 5 percent of EQIP 

funding was used to benefit wildlife. 

State Conservationists have authority to 

focus EQIP to meet locally established 

priorities to target at-risk species and 

listed species based upon input from 

technical committees and to determine 

the specific context or scenarios under 

which the practices must be applied to 

achieve the desired wildlife benefits. 

Due to other changes in the interim 

rule, the provisions related to the EQIP 

plan of operations section that 

previously appeared at § 1466.9 now 

appear at § 1466.7. Section 1466.7 now 

describes the requirements of the EQIP 

plan of operations, which is a 

component of the EQIP contract. Section 

2204 of the 2014 Act replaced the term 

‘‘environmental benefits’’ with 

‘‘conservation benefits.’’ Therefore, 

NRCS amends the provisions to replace 

the term ‘‘environmental objectives’’ 

with the term ‘‘conservation objectives’’ 

every place it occurs in the section. 

Due to other changes in the interim 

rule, the provisions related to the EQIP 

plan of operations section that 

previously appeared at § 1466.10 now 

appear at § 1466.8. Section 1466.8, 

‘‘Conservation practices,’’ now describes 

how NRCS determines eligible 

conservation practices. NRCS makes a 

minor editorial change in paragraph (a) 

to clarify that the term ‘‘practice’’ used 

in the second sentence means 

‘‘conservation practice’’ as defined in 

§ 1466.3. Additionally, NRCS amends 

paragraph (d) to reference ‘‘conservation 

benefits’’ instead of ‘‘environmental 

benefits’’ consistent with the statutory 

change made by section 2204 of the 

2014 Act. Finally, NRCS adds a new 

paragraph (e) to ensure that State 

Conservationists target EQIP funds to 

wildlife habitat consistent with the 

additional wildlife habitat purposes 

incorporated into EQIP by section 2203 

of the 2014 Act. Technical Service 

Providers (TSP) provisions previously 

numbered § 1466.11 are now at located 

at § 1466.9. 

Part 1466, Subpart B—Contracts 

Section 1466.20, ‘‘Application for 

contracts and selecting applications,’’ 

addresses how producer applications 

are submitted and selected for funding. 

NRCS updates the language throughout 

§ 1466.20 to reference ‘‘conservation 

benefits’’ instead of ‘‘environmental 

benefits,’’ consistent with the 

amendment made by section 2204 of the 

2014 Act. NRCS also updates the terms 

used throughout § 1466.20 to 

correspond to the updates to the terms 

in § 1466.3 Definitions. To reduce 

administrative burden and improve 

timely delivery of program benefits, 

NRCS also removes the nonstatutory 

requirement in § 1466.20(b)(5) that EQIP 

applications $150,000 or greater require 

the review and approval of the Regional 

Conservationist. Since the term Regional 

Conservationist is not used in any other 

section of this rule other than in regards 

to the above requirement to be removed, 

the definition is also removed from 

§ 1466.3. 

Section 1466.21, ‘‘Contract 

requirements,’’ identifies elements 

contained within an EQIP contract and 

the responsibilities of the participant 

who is party to the EQIP contract. This 

section also addresses EQIP contract 

funding limitations. To receive 

payment, an applicant must enter into 

an EQIP contract. The EQIP contract 

identifies all financially supported 

conservation practices to be 

implemented, their timing and 

sequence, and the operation and 

maintenance (O&M) needed to maintain 

the conservation practice for its 

intended lifespan. NRCS amends 

paragraph (b)(2) to change the duration 

of the term of an EQIP contract to 

correspond with the change to the 

length of the contract term made by 

section 2203 of the 2014 Act. In 

particular, an EQIP contract will have a 

term for no more than ten years. Since 

EQIP only makes payment for the 

implementation of conservation 

practices, and does not provide annual 

or rental payments, EQIP contracts are 

not renewed. NRCS amends this section 

by replacing ‘‘within the agricultural or 

forestry operation’’ with ‘‘on the 

enrolled land’’ consistent with the 

change made by section 2205 of the 

2014 Act that replaced ‘‘farm, ranch, or 

forest’’ with ‘‘enrolled’’ at section 1240D 

of the EQIP statute. 

NRCS continues to use a contract 

funding limitation to manage program 

payment limitations. Consistent with 

statutory payment limitation 

requirements, NRCS retains the 

administrative authority to limit the 

maximum contract amount to equal the 

person/legal entity payment limitation. 

Specific payment limitations are 

addressed in § 1466.24, EQIP Payments. 

Section 1466.22, ‘‘Conservation 

practice operation and maintenance,’’ 

addresses the participant’s 

responsibility for conservation practice 

operation and maintenance. NRCS 

replaces the term ‘‘environmental 

benefits’’ with ‘‘conservation benefits’’ 

consistent with section 2204 of the 2014 

Act. 

Section 1466.23, ‘‘Payment rates,’’ 

addresses payment rates and payment 

eligibility. NRCS replaces the reference 

to ‘‘environmental benefits’’ with 

‘‘conservation benefits’’ at paragraph 

(a)(4), consistent with section 2204 of 

the 2014 Act. Section 2203 of the 2014 

Act revises the list of factors that NRCS 

may consider significant when 

determining the amount and rate of 

payment for income foregone to: Soil 

health; water quality and quantity 

improvement; nutrient management; 

pest management; air quality 

improvement; wildlife habitat 

development, including pollinator 

habitat; and invasive species 

management. NRCS revises this section 

to incorporate these changes made by 

section 2203. 

For participants who NRCS identifies 

meet the definition of historically 

underserved producers, in accordance 

with § 1466.3, NRCS may award the 

applicable payment rate and an 

additional payment rate that is not less 

than 25 percent above the applicable 

payment rate, provided this increase 

does not exceed 90 percent of the 

estimated incurred costs and 100 

percent of income foregone associated 

with the conservation practice. NRCS 

amends this section to clarify that 

veteran farmers or ranchers may also be 

awarded the special payment rate for 

historically underserved producers 

consistent with the addition of veteran 

farmers and ranchers by section 2203 of 

the 2014 Act. 

NRCS also revises this section to 

clarify that NRCS will reduce the 

applicable payment rate to which a 

producer is entitled if the producer 

receives financial contributions for the 

implementation of a conservation 

practice from other USDA sources. The 

2008 Act had revised section 

1240B(d)(5) of the 1985 Act to specify 

that any non-Federal assistance that a 

producer receives should not impact the 

level of financial assistance a producer 

receives for EQIP participation. The 

January 2009 interim final rule had not 

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updated this; therefore, NRCS is making 

the adjustment in this interim rule. 

Section 1466.24, ‘‘EQIP payments,’’ 

provides direction on payment 

eligibility and payment limitations. 

Section 2206 of the 2014 Act amended 

section 1240G of the 1985 Act to replace 

the current $300,000 payment limitation 

with a $450,000 payment limitation and 

to apply the new payment limitation for 

a specific time period of FY 2014 

through FY 2018, replacing the rolling 

6-year period. NRCS amends paragraph 

(a) to incorporate this specific payment 

limitation for EQIP payments received 

during FY 2014 through FY 2018. The 

2014 Act did not change the payment 

limitations associated with EQIP 

support of organic operations or those 

transitioning to organic production per 

section 1240(B) of the 1985 Act ($20,000 

per year or $80,000 during any six year 

period). Therefore, the Agency will 

enforce both payment limitations 

applicable to all program participants as 

cited in § 1466.24. 

Section 1466.24 is also to use 

simplified regulatory references, such as 

replacing ‘‘part 1400 of this chapter’’ 

with ‘‘7 CFR part 1400.’’ Paragraph 

(c)(10) incorporates the flexibility 

provided by the amendments made by 

section 2203 of the 2014 Act to how 

advance payments may be made to 

historically underserved producers. In 

particular, advance funds paid to 

program participants must be expended 

within 90 days from receipt of funds or 

returned to NRCS within a reasonable 

time as determined by NRCS and 

eligibility for advance payment is 

contingent upon the participant 

obtaining an NRCS approved practice 

design. 

Section 1466.27, ‘‘Conservation 

Innovation Grants,’’ sets forth the 

policies and procedures related to 

awarding grants under the CIG 

provision at section 1240H of the 1985 

Act. Section 2207 of the 2014 Act added 

a reporting requirement for NRCS. In 

particular, NRCS must report not later 

than December 31, 2014, and every two 

years thereafter, to the Committee on 

Agriculture, Nutrition, and Forestry of 

the Senate and the Committee on 

Agriculture of the House of 

Representatives a report on the status of 

projects funded under the section, 

including funding awarded; project 

results; and incorporation of project 

findings, such as new technology and 

innovative approaches, into NRCS 

conservation efforts. A new paragraph 

has been added at § 1466.27(j) to 

address this reporting requirement. 

Part 1466, Subpart C—General 

Administration 

Subpart C of the EQIP regulation 

addresses a participant’s responsibility 

to comply with regulatory measures, to 

provide NRCS access to lands enrolled 

in the program for compliance 

monitoring during the term of the 

contract and other general program 

matters. The 2014 Act changes do not 

impact the regulatory provisions at 

Subpart C. 

Summary of Changes to EQIP for 

Administrative Clarification and 

Reducing Administrative Complexity 

NRCS is clarifying a few 

administrative provisions. Additionally, 

NRCS is simplifying the administrative 

complexity of the EQIP rule by 

clarifying and streamlining the 

regulation to focus upon only those 

provisions that relate to conservation 

program participants rights and 

responsibilities under the programs. 

Topics are organized below in 

alphabetical order. 

Animal Feeding Operations (AFOs) 

(§§ 1466.3, 1466.7, and 1466.21) 

Section 1240E(a)(3) of the 1985 Act 

authorizes payments for AFOs provided 

that the producer submits a plan of 

operations that provides for 

development and implementation of a 

comprehensive nutrient management 

plan (CNMP), if applicable. The 2002 

Act removed an existing restriction for 

EQIP to provide assistance to large 

confined livestock feeding operations. 

Neither the 2008 Act nor the 2014 Act 

made modifications to these provisions. 

However, to improve the clarity of the 

regulation regarding AFO CNMP 

requirements, NRCS is updating the 

EQIP rule to incorporate a definition for 

AFOs and is revising the definition of 

CNMP to state that these are 

conservation plans developed 

specifically for an AFO. 

Consistent with these updates, NRCS 

is revising § 1466.7, EQIP plan of 

operations, to clarify that if an EQIP 

plan of operations includes an animal 

waste storage or treatment facility to be 

implemented on an AFO, the 

participant must agree to develop and 

implement a CNMP by the end of the 

contract period which will be verified 

by NRCS. Finally, § 1466.21, Contract 

requirements, is being updated to state 

that a CNMP should be implemented 

when an EQIP contracts includes an 

animal waste facility on an AFO. 

Conservation Innovation Grants 

(§ 1466.27) 

The CIG component of EQIP 

stimulates the development and 

adoption of innovative conservation 

approaches and technologies while 

leveraging Federal investment in 

environmental enhancement and 

protection in conjunction with 

agricultural production. The regulations 

for CIG are found at 7 CFR 1466.27. CIG 

grants are administered in accordance 

with Departmental and governmentwide requirements for financial 

assistance awards. 

NRCS is adding a definition for 

cooperative agreement to clarify that 

both grant agreements and cooperative 

agreements may be used. NRCS is also 

removing the provisions at 7 CFR 

1466.27(c)(1) and 1466.27(f) that require 

CIG funding opportunities to be 

published in the Federal Register. Since 

this provision was first incorporated, 

the Federal Government adopted the 

Grants.gov portal through which 

funding opportunities are announced. 

Therefore, such announcements are no 

longer required to be published in the 

Federal Register. NRCS has also made 

several adjustments to this section to 

explain the financial responsibilities of 

a grantee. NRCS also deleted paragraphs 

(h)(5) and (6) referring to internal 

agency processes for state-level grants. 

Subsections (j) and (k), related to 

patents and inventions and violations, 

were struck because the matter 

discussed is covered in other parts of 

the CFR. 

Consultation With Conservation 

Districts (§ 1466.26) 

Section 1466.26 authorizes NRCS to 

consult with conservation districts in 

contract termination decisions. 

However, section 1619 of the 2008 Act 

imposes limitations on the disclosure of 

certain types of information provided by 

an agriculture producer. Therefore, this 

section has been removed though NRCS 

will continue to work closely with its 

conservation district partners in the 

implementation of EQIP and its other 

conservation programs. 

Definition of Terms (§ 1466.3) 

The definition of ‘‘beginning farmer or 

rancher’’ has been revised to reflect the 

authority of the Food Security Act of 

1985 and amendment from the 2008 Act 

which added nonindustrial private 

forest land (NIPF) as specifically eligible 

for EQIP. The revision is also consistent 

with Departmental regulation. The 

revised definition now reads as: 

Beginning farmer or rancher means a 

person or legal entity who: 

(1) Has not operated a farm or ranch, 

or NIPF, or who has operated a farm, 

ranch, or NIPF for not more than 10 

consecutive years. This requirement 

applies to all members of an entity who 

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will materially and substantially 

participate in the operation of the farm 

or ranch. 

(2) In the case of a contract with an 

individual, individually, or with the 

immediate family, material and 

substantial participation requires that 

the individual provide substantial dayto-day labor and management of the 

farm or ranch consistent with the 

practices in the county or State where 

the farm is located. 

(3) In the case of a contract with an 

entity or joint operation, all members 

must materially and substantially 

participate in the operation of the farm 

or ranch. Material and substantial 

participation requires that each of the 

members provide some amount of the 

management, or labor and management 

necessary for day-to-day activities, such 

that if each of the members did not 

provide these inputs, operation of the 

farm or ranch would be seriously 

impaired. 

Conservation practice: 

NRCS has amended the definition of 

conservation practice to clarify that 

approved conservation practices are 

listed in the NRCS Field Office 

Technical Guide. 

Estimated income foregone: 

For clarification, NRCS has expanded 

the definition to clarify the elements 

that are used in its calculation. 

Therefore, the definition now reads: 

‘‘Estimated income foregone means an 

estimate of the net income loss 

associated with the adoption of a 

conservation practice. Along with other 

estimated incurred costs, foregone 

income is one of the costs associated 

with practice implementation as 

recorded in a payment schedule. NRCS 

calculates foregone income as the 

average annual net income ($/unit/year) 

lost from implementing a conservation 

practice which results in a change in 

land use or land taken out of production 

or the opportunity cost associated with 

the adoption of a conservation practice. 

Foregone income will not include losses 

of income due to disaster or other events 

unrelated to the conservation practice 

such as risk associated with agricultural 

production.’’ 

Environmental Credits (§ 1466.36) 

NRCS recognizes the increased 

interest among agricultural producers to 

be able to participate in environmental 

service markets. The policy in this 

section is not new. Minor editorial 

changes are made to § 1466.36. 

Irrigation History Requirement 

(§ 1466.8—as Renumbered) 

NRCS has received numerous 

comments since publication of the EQIP 

interim final rule in January 2009 

related to the topic of irrigation. These 

comments have focused upon the 

irrigation history requirement in EQIP 

that is used to determine whether 

proposed irrigation related practices 

will result in water conservation or 

water savings. 

A requirement of EQIP is to provide 

a positive conservation benefit to 

address a resource concern, which for 

the purpose of a cropland irrigation 

practice, is water conservation. Whether 

water conservation objectives have been 

achieved is often determined through a 

calculation of water savings based upon 

the difference in amount of water used 

before and after implementation of the 

irrigation practice, thus providing an 

estimate of water saved or conserved. 

Without evidence of existing 

irrigation, it is difficult to justify 

funding to implement a water 

conservation practice if there is no 

documentation of past water use and 

therefore savings. Funding practices to 

facilitate new irrigation practices that do 

not currently exist would use more 

water than previously and tend to defeat 

the purpose of the program to provide 

a conservation benefit. 

Historically, USDA and NRCS 

conservation programs have received 

overall support for the rule and policy 

requirements to provide evidence that 

land has been irrigated 2 of the past 5 

years to ensure that both a natural 

resource concern will be addressed by 

EQIP assistance and that EQIP 

assistance does not result in adverse 

impacts to aquifer depletion or surface 

streams experiencing decreased flow. 

However, the strict irrigation history 

requirement may have inadvertently 

disadvantaged some individuals or 

groups and there may be specific 

situations where adjustment of the 

requirement may be appropriate. 

Some producers, especially limited 

resource and socially disadvantaged 

producers, cannot benefit fully from 

EQIP assistance because of difficulty 

meeting this irrigation history 

requirement for reasons beyond their 

control. There are situations where 

producers cannot document historical 

use of irrigation on some lands, such as 

Tribal lands, and therefore, cannot meet 

or document the irrigation history 

requirement. Additionally, producers 

who do not have extensive structural 

irrigation delivery systems use nonmechanized irrigation methods and do 

not maintain records for these irrigation 

applications. 

Between October 2010 and January 

2011, NRCS participated in seven 

Interagency Tribal consultation 

meetings held across the nation. The 

effort was coordinated by the USDA 

Office of Tribal Relations and provided 

an opportunity for Tribal leaders to 

comment in person on the programs 

authorized by the Food, Conservation, 

and Energy Act of 2008. NRCS staff 

presented program overviews to 

attending Tribal Representatives that 

provided them with a better 

understanding of program details. 

The EQIP irrigation history 

requirement was among the top ten 

issues raised by the Tribal 

representatives during the Interagency 

Tribal consultation meetings. The Tribal 

representatives identified that the 

irrigation history requirement raised 

barriers to Tribal participation in EQIP 

due to drought, incomplete irrigation 

pipelines, or loss of water use rights or 

access to water. 

Therefore, NRCS is modifying the 

EQIP regulation to address the irrigation 

history requirement through 

introduction of a waiver provision. In 

particular, NRCS has determined that it 

is appropriate, pursuant to the 

Secretary’s authority under 16 U.S.C. 

3844 to address barriers to participation 

by historically underserved producers, 

to incorporate a limited waiver to the 

irrigation history requirement under the 

EQIP regulation. 

NRCS believes that a narrowlytailored waiver provision will address 

these participation barriers in a manner 

that ensures EQIP continues to meet its 

statutory purposes through fully 

addressing natural resource concerns on 

eligible land. The new waiver provision 

will address two different circumstances 

described more fully below: (1) one 

circumstance is particular to limited 

resource and socially disadvantaged 

producers, including individual Indian 

producers; and (2) one circumstance is 

particular to Indian lands, as defined by 

the EQIP regulation, that have been 

designated as ‘‘permanently irrigable’’ 

‘‘by the Bureau of Indian Affairs. 

For circumstances related to limited 

resource and socially-disadvantaged 

producers, this rule provides that the 

NRCS Chief may waive the irrigation 

history requirement where, for reasons 

beyond the control of the producer, the 

producer could not irrigate the land but 

there exists an identified natural 

resource concern. More specifically, the 

water-conservation or irrigation-related 

conservation practice must address the 

natural resource concern through the 

successful and cost-effective 

implementation of other practices that 

address soil quality and erosion 

resource concerns, and all other 

program requirements can be met. 

The waiver authority will only be 

available to limited resource and 

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socially-disadvantaged producers, 

including individual Indian tribal 

producers, who wish to install an 

efficient irrigation system as a means to 

assist with the adoption of sustainable 

agricultural production methods, as 

determined by the Chief, and such 

adoption will not adversely impact 

limited surface water or groundwater 

supplies. Sustainable production 

methods may include the establishment 

of cover crops and irrigation water 

management as part of no-till 

production or organic production 

systems needed to ensure a positive 

trend in the soil condition index. To 

ensure that the waiver does not result in 

converting land into more intensive 

uses such as converting pasture to 

cropland, this rule also provides that a 

producer who seeks a waiver must also 

be able to establish that the land has 

been in active agricultural production 

(cropped, hayed, or grazed) four of the 

last six years. 

NRCS establishes these limitations for 

availability of the waiver based on 

several reasons. First, EQIP eligibility 

requires that any practice funded will 

address identified natural resource 

concerns related to agricultural 

production. Therefore, absent 

documentation of irrigation history, the 

proposed irrigation practice must 

directly facilitate the successful 

implementation of a practice that 

addresses an identified natural resource 

concern (such as soil quality 

improvements or erosion control) as 

part of a resource management system. 

To minimize any potential negative 

impacts upon surface and ground water 

supplies, NRCS will evaluate the impact 

of granting a waiver, both individually 

and cumulatively, prior to approval and 

incorporate any necessary limitations to 

ensure that such impact is minimized. 

Criteria used to evaluate the potential 

impact of a waiver on existing water 

supplies will be developed by NRCS, 

and the agency is using this rulemaking 

as an opportunity to obtain public input 

on the availability of a waiver and the 

criteria for granting and evaluating the 

impact of such waivers. 

For example, the impacts upon water 

supplies could be based on, but not 

necessarily limited to, the following 

sample criteria: 

• For groundwater systems, the 

aquifer must not be declining in 

elevation or in yield; 

• For surface water diversions east of 

the 100th meridian, a legal right to use 

surface water must be in possession of 

the applicant. The surface water source 

would need to be documented as 

meeting all other legal water rights 8 out 

of 10 of the last years; and 

• For surface water diversions west of 

the 100th meridian, the surface water 

source must be shown to have met all 

state-designated beneficial uses for 

which legal rights are held 5 out of the 

last 10 years. 

Waivers will not be granted in areas 

that have been subject to water 

shortages. Additional criteria may 

include the extent of the acreage being 

placed under irrigation, and NRCS seeks 

specific public comment about whether 

acreage limitations should also be 

amongst the criteria applied to limit the 

potential impact to existing water 

supplies. For example, NRCS could 

limit its approval of waivers to where 

less than 50 acres of cropland are to be 

irrigated with an efficient irrigation 

system meeting NRCS practice 

standards. The 50-acre limitation 

criteria would be based upon the 

standard field size that can be irrigated 

with a center pivot. 

Finally, NRCS establishes the four of 

the last six years agricultural production 

history as a means to ensure that land 

is not converted into more intensive 

uses that significantly impact water 

resources, and is patterned after 

recognized statutory cropping history 

requirements under the Conservation 

Reserve and Conservation Stewardship 

Programs. 

Additionally, NRCS may also 

authorize a waiver of the irrigation 

history requirement for circumstances 

faced by federally recognized Indian 

Tribes. The Bureau of Indian Affairs 

(BIA) has categorized various Tribal 

lands as ‘‘permanently irrigable.’’ These 

lands include lands that were known 

historically to be previously irrigated, or 

where there were plans to establish 

irrigation facilities though approved 

projects that were never constructed. 

Another situation is that the planned 

irrigation practices were constructed, 

but were inappropriate for the 

associated management practices or 

were not finished completely, and thus 

were not utilized for the intended 

purpose or need. 

In some circumstances, these lands 

were previously irrigated, but for 

various reasons, deteriorated where 

irrigation delivery became unfeasible or 

resulted in litigation concerning water 

rights which prevented the Indian 

tribe’s lands from actually being 

irrigated. Often, affected producers on 

these Tribal lands are required to and 

continue to pay operation and 

maintenance fees for the irrigation 

delivery facilities even when no 

irrigation water is being delivered. 

These lands, once water rights and 

delivery issues have been resolved, can 

and likely will be under irrigation 

production and meet the intent of 

statute to conserve and efficiently use 

available water. 

Again, to minimize any potential 

increased negative impact upon surface 

and groundwater water supplies, NRCS 

will evaluate the impact of granting a 

waiver, both individually and 

cumulatively, prior to approval and 

incorporate any necessary limitations to 

ensure that such impact is minimized. 

Criteria used to evaluate the potential 

impact of a waiver on existing water 

supplies will be developed by NRCS, 

and the agency is using this rulemaking 

as an opportunity to obtain public input 

on the availability of a waiver and the 

criteria for granting and evaluating the 

impact of such waivers. Waivers will 

not be granted in areas that have been 

subject to water shortages during the 

previous full irrigation season. 

When a waiver is being considered for 

land proposed for the EQIP program that 

has been designated permanently 

irrigable by the BIA, the impacts upon 

water supplies could be based on, but 

not necessarily limited to, the following 

sample criteria: 

• Whether water rights are secured 

and legal; 

• For sources of irrigation from 

groundwater, the aquifer is not 

declining in either elevation or yield. 

There may be situations where although 

there is a declining aquifer, a Tribal 

entity has a water right that is senior to 

many of the other groundwater rights. 

These cases will be evaluated 

individually; and 

• For surface water sources, the 

Tribal water rights are such that they 

would have resulted in full-volume 

delivery 5 out of the last 10 years. 

Such criteria may also include the 

extent of the acreage being placed under 

irrigation, and NRCS also seeks specific 

public comment about whether acreage 

limitations should also be amongst the 

criteria applied to evaluating whether a 

waiver on Tribal land is appropriate. 

For example, NRCS could limit the 

waiver to 200 acres/Tribe, basing the 

200-acre limitation upon allowance of 

four of the standard 50-acre fields that 

can be irrigated with a center pivot. 

NRCS believes that such criteria could 

focus EQIP assistance to Tribal 

operations that do not have the financial 

resources necessary to implement water 

conservation measures on their own and 

thus EQIP assistance is needed. 

EQIP’s water conservation purposes 

can be furthered by granting a waiver for 

irrigation-related assistance on Indian 

lands classified as permanently irrigable 

with existing irrigation-related facilities, 

and where the producer has been paying 

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operation and maintenance fees for 

irrigation water delivery. 

NRCS believes the new waiver with 

these two categories of producers will 

balance the need for EQIP assistance by 

producers who have not been able to 

establish an irrigation history with 

ensuring that implementation of a 

waiver does not have an unintended 

consequence of increasing depletion of 

limited surface or groundwater 

resources. NRCS requests public 

comment on the availability of a waiver 

and the criteria for granting such 

waivers. This rulemaking amends the 

EQIP regulation by incorporating a 

waiver provision at 7 CFR 1466.8(c). 

Outreach (§ 1466.5—as Renumbered) 

To improve clarity of this interim 

rule, NRCS has amended the language 

in § 1466.5 (as renumbered) to read as 

follows: 

‘‘NRCS will establish program 

outreach activities at the national, State, 

Tribal, and local levels in order to 

ensure that producers whose land has 

environmental problems and priority 

resource concerns are aware and 

informed that they may be eligible to 

apply for program assistance. Special 

outreach will be made to eligible 

producers with historically low 

participation rates, including but not 

restricted to, limited resource, socially 

disadvantaged, small-scale, or beginning 

farmers or ranchers, veteran farmers or 

ranchers, Indian Tribes, Alaska Natives, 

and Pacific Islanders. NRCS provides 

outreach so as not to limit producer 

participation because of size or type of 

operation or production system, 

including small-scale, specialty crop 

and organic production.’’ 

NRCS provides further guidance in 

agency policy that special emphasis will 

be made in all information activities to 

provide conservation assistance, 

program outreach, and access to limited 

resource farmers or ranchers, socially 

disadvantaged farmers or ranchers, 

small-scale farmers or ranchers, 

beginning farmers or ranchers, Tribal 

members, Alaska Natives, Pacific 

Islanders, producers with disabilities, 

veteran farmers or ranchers, and other 

producers with historically low 

participation rates in conservation 

programs. Procedures will adhere to 

national outreach policy guidance in 

GM Title 230 Part 406. Special emphasis 

outreach efforts could include, but not 

be limited to: 

(a) Establishing special outreach 

activities at the national, State, Tribal, 

and local levels; and 

(b) Providing special 

accommodations, to the extent possible, 

to assure that producers are aware, 

informed, and have access to 

information and assistance, such as: 

(1) Using language spoken by the 

intended audience; 

(2) Using appropriate media sources 

to reach the intended audience; and 

(3) Partnering with nongovernmental 

organizations to assist in reaching more 

potential applicants. 

Practice Costs, Payment Rates, and 

Payment Schedules (§ 1466.23) 

The process for documenting 

estimated incurred costs for 

conservation practices implemented 

through program support is an iterative 

process that begins with technical 

requirements of the practice standard, 

development of geographically based 

regional scenarios, identification of 

associated components and costs, and a 

quality control process for review and 

publication of resulting payment 

schedules used to support final payment 

rates. The process for documentation of 

estimated costs in payment schedules 

provides the following benefits to 

ensure accurate and timely delivery of 

program benefits: 

(i) Provide transparency and timely 

payment rate information to program 

applicants and agency partners, 

(ii) Ensure that payment schedules are 

consistent with program authority, 

(iii) Provide a consistent, reliable, and 

defensible method for documenting 

eligible costs, 

(iv) Provide flexibility which reflects 

cost variation across the Nation, 

(v) Uses established and accepted 

economic geographic areas aligned with 

States and regions based on farm 

employment data, crop costs, and other 

economic factors, 

(vi) Ensure payment rates and 

financial assistance are consistent with 

the definition, purpose, and 

requirements of approved conservation 

practice technical standards, 

(vii) Provide producers, through use 

of standardized cost estimates rather 

than detailed invoicing, simpler 

program application, contract 

administration, and request for program 

payments, and 

(viii) Support agency efforts to reduce 

State and field staff workload associated 

with administrative matters allowing 

more time for conservation planning, 

technical assistance, and practice 

implementation. 

NRCS believes that payment rates are 

best established through a nationally 

guided payment schedule process with 

State Conservationists, in consultation 

with the State Technical Committee, 

Tribal Conservation Advisory Council, 

and local working groups setting 

payment percentages which determine 

the final payment rate. The current 

regulation provides that ‘‘Practice 

payment rates greater than 50 percent 

for estimated costs incurred . . . are to 

be approved by the Chief or designee.’’ 

This provision related directly to 

previous statutory authority to make 

cost-share and incentive program 

payments. The 2008 Farm Bill 

eliminated authority for cost-share and 

incentive payments and established 

maximum payment limitations of 75 

percent of estimated incurred costs and 

up to 90 percent of estimated incurred 

costs for historically underserved 

participant program payments. As a 

result the need for establishing costshare percentages to calculate contract 

payments was eliminated. The 

nationally guided payment schedule 

process establishes controls to assure 

that these payment limitations are not 

exceeded in determination of program 

payment rates and therefore the need for 

agency review of these percentages are 

no longer needed. 

NRCS makes a revision to the rule to 

clarify when payment rates may be 

reduced as a result of the agency 

entering into a formal agreement with a 

partner who provides payments to 

producers participating in EQIP. Section 

1466.23(b)(4) is added as follows: 

‘‘When the agency enters into a formal 

agreement with partners who provide 

financial support to help implement 

program initiatives, the Chief must 

adjust NRCS program payment 

percentages to provide practice payment 

rates to an amount such that the total 

financial assistance to the participant 

from NRCS and the partner does not 

exceed the amount needed to encourage 

voluntary adoption of the practice.’’ 

NRCS makes a technical correction in 

its cross-reference in § 1466.24(c)(1) to 

cite correctly to subparts in 7 CFR part 

1400. 

State Technical Committee as Identified 

in the EQIP Rule (§ 1466.2) 

In order to clarify the role of the State 

Technical Committee and further align 

the EQIP rule with the State Technical 

Committee rule (7 CFR part 610), NRCS 

has revised § 1466.2(b). 

Technical Service Providers as 

Appearing in the EQIP Rule (§ 1466.9— 

as Renumbered) 

NRCS is making several adjustments 

to ensure that its references to TSPs in 

the EQIP regulation are consistent with 

the TSP regulation at 7 CFR part 652 by 

stating examples of eligible services. 

Additionally, due to other changes in 

the interim rule, the provisions that 

previously appeared at § 1466.11 

regarding TSPs will now appear at 

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§ 1466.9. NRCS also changed the 

definition of TSPs to clarify the process 

of becoming a TSP. 

Transparency (§ 1466.20) 

Government transparency is furthered 

by public access to various government 

documents and information. NRCS 

supports open government to the extent 

authorized by law. Several statutory 

provisions limit the disclosure of 

Federal information where the release of 

such information may adversely affect 

an individual’s privacy or other 

confidential matters. In particular, 

release of EQIP documents is governed 

by the Freedom of Information Act 

(FOIA), the Privacy Act, section 1619 of 

the 2008 Act, and section 1244 of the 

1985 Act. NRCS will provide as much 

transparency as possible concerning 

funding usage while adhering to the 

FOIA and Privacy Act requirements. 

Section 1619 of the 2008 Act prohibits 

NRCS from releasing any information 

specific to a producer’s operation, 

practice, or the land itself in order to 

participate in USDA programs. NRCS 

will continue to aggregate information 

about EQIP including kinds of practices 

and extent and funding associated with 

contacts at the State and national levels. 

Section 1466.20(b)(6) of the EQIP rule 

specifies that NRCS will make available 

to the public all information regarding 

priority resource concerns, the list of 

eligible practices, payment rates, and 

how EQIP is implemented in a State. At 

the national level, NRCS posts 

information concerning EQIP at: 

www.nrcs.usda.gov/programs/EQIP. 

Tribal Issues (Sections Throughout 

Interim Rule) 

Between October 2010 and January 

2011, NRCS participated in seven 

interagency Tribal consultation 

meetings held across the Nation. The 

effort was coordinated by the USDA 

Office of Tribal Relations and provided 

an opportunity for Tribal leaders to 

comment in person on the 2008 Act 

programs. NRCS participated again in 

Tribal consultation meetings in April 

2014. 

In response, NRCS has made several 

adjustments to the EQIP rule. The term 

Tribal Conservation Advisory Council 

was added wherever applicable to more 

accurately portray relationships of these 

bodies in providing advice to the State 

Conservationist. The term Indian Tribes 

and Tribal were included throughout 

the regulation to ensure clarity in 

program delivery, and language was 

added to ensure more clarity concerning 

NRCS’ relationship with the Bureau of 

Indian Affairs (BIA) at § 1466.6(b)(3). 

NRCS has also incorporated provisions 

to clarify to that payment and contract 

limitations do not apply to Indian 

Tribes but apply to individual Tribal 

member(s) at § 1466.24(a). The removal 

of the maximum limitation for contracts 

with Indian Tribes facilitates the ability 

of NRCS to address the natural resource 

concerns faced by Indian producers on 

tribal lands by allowing the larger Tribal 

parcels with multiple producers to be 

administered under a single contract. 

NRCS anticipates removal of this barrier 

will improve efficiency and delivery of 

program benefits to Tribes. 

Other EQIP Adjustments 

The following changes to § 1466.3 

definitions were made to clarify 

program administration and ensure 

consistency in program implementation: 

• Indian Tribe: NRCS has included 

the word ‘‘pueblo’’ in the definition of 

Indian tribe. Although pueblo is 

encompassed in the term other 

organized group or community, NRCS is 

adding the term to provide additional 

clarity to the interim rule that pueblos 

are included as one of these recognized 

communities consistent with 

Departmental regulation. 

• Limited resource farmer or rancher: 

NRCS amends the term, ‘‘limited 

resource farmer or rancher,’’ by 

replacing the reference to ‘‘$155,200’’ 

with ‘‘the current indexed value.’’ Using 

data provided by the various Federal 

agencies, NRCS establishes the value 

used for determining limited resource 

farmer and rancher which is calculated 

each fiscal year to reflect inflation, 

income, agricultural prices, poverty 

levels, and other factors. Details 

regarding the kind of data used and 

formula calculations are found at 

http://www.lrftool.sc.egov.usda.gov/

About.aspx. NRCS adjusts the EQIP 

definition to correspond with the 

definition used more widely throughout 

the Department. NRCS also adds clarity 

by identifying when a legal entity or 

joint operation meets the requirements 

to be considered a limited resource 

farmer or rancher. 

• Priority resource concern: NRCS 

revises the term ‘‘priority resource 

concern’’ to align program terminology 

with other conservation programs 

administered by NRCS by clarifying that 

a priority resource concern is a 

‘‘natural’’ resource concern. 

• Resource concern: In order to be 

consistent with other NRCS financial 

assistance programs, NRCS has 

amended the definition for resource 

concern. 

NRCS makes the following additional 

administrative changes: 

National Priorities—§ 1466.4 

Section 1466.4 National Priorities, 

identifies the national priorities for 

program implementation. Prior to the 

publication of the January 2009 interim 

final rule, NRCS identified these 

national priorities through public 

feedback in order to ensure that the 

stated national priorities reflected the 

most pressing natural resource needs. 

NRCS makes three minor adjustments to 

§ 1466.4. The first is to add energy 

conservation as one of the resource 

concerns addressed through EQIP which 

was not specifically addressed in the 

January 2009 interim rule. Although 

energy conservation was included as a 

purpose for EQIP in the 2008 Act, at the 

time, neither the agency nor industry 

had developed the tools needed to 

develop plans and practices which 

address this concern. Pursuant to the 

2008 Act’s authorization of the use of 

EQIP to address on-farm energy 

conservation benefits, NRCS has 

implemented the ‘‘EQIP On-Farm 

Energy Initiative’’ to enable a producer 

to identify ways to conserve energy on 

the farm through an Agricultural Energy 

Management Plan, also known as an onfarm energy audit, and by providing 

financial and technical assistance to 

help the producer implement various 

measures and practices recommended 

in an on-farm energy audit. The other 

two changes are to replace ‘‘resource 

concern’’ with ‘‘natural resource 

concern’’ and clarifying that promotion 

of at-risk species habitat conservation 

includes the development and 

improvement of wildlife habitat. NRCS 

has established the national priorities to 

address natural resource concerns 

associated with enhancements to soil 

quality, water quality and quantity, 

plant health, energy conservation, 

wildlife habitat, air quality, and related 

resource concerns, that may be 

addressed through EQIP. 

National and State Allocation 

Management Sections—§§ 1466.5 and 

1466.6 

NRCS is removing these two sections 

as they relate to internal fund allocation 

management which are internal agency 

administrative procedures and do not 

affect the rights and responsibilities of 

EQIP participants. NRCS has utilized a 

formula for allocation of EQIP funds to 

States based upon factors established at 

§ 1466.5. Based upon both internal and 

external comment, NRCS recognized 

that the existing process did not 

adequately identify priority resource 

needs, the locally led process, or 

information available at the State level 

which could provide more 

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comprehensive data to make allocation 

decisions. In FY 2011, the agency 

developed a new allocation process 

based upon State-generated assessments 

of priority natural resource needs and 

associated work necessary to address 

identified resource concerns. These 

State-developed assessments, following 

national guidance to assure accuracy 

and consistency, were reviewed with 

partners, stakeholders, other agencies, 

and others to quantify resource needs, 

priorities, agency goals, workload and 

available resources, and program 

opportunities to support direct requests 

from State Conservationists. These 

requests were submitted to agency 

leadership for review, and final EQIP 

allocations were based upon all requests 

and needs. This approach provides 

flexibility to address nationally and 

locally important natural resource 

concerns and provides a more reliable 

and accurate estimate of each State’s 

needs, which in turn can be used to 

better inform the allocation process. The 

Agency will use a nationally consistent 

method to document resource needs and 

provide a foundation for establishing 

priorities within States. Inputs may 

include National Resources Inventory 

(NRI) land use data, NRI soil erosion 

estimates, NRI Rangeland Resource 

Assessment rangeland health data, NRI 

CEAP soil organic carbon data, and 

various attributes from the Soil Survey 

Geographic (SSURGO) database. These 

and other data layers maybe used to 

calculate critical acres by State and 

identified natural resource concerns. 

§§ 1466.8 Through 1466.11 

These sections are re-numbered in 

this interim rule to reflect the changes 

made by the removal of the 

administrative allocation sections. The 

provisions that previously appeared at 

§§ 1466.8 through 1466.11 are now 

found at §§ 1466.6 through 1466.9. 

Conservation Practice Operation and 

Maintenance—§ 1466.22 

In order to clarify NRCS operating 

procedures, NRCS has amended 

§ 1466.22(c) to state as follows: 

‘‘Conservation practices installed before 

the contract execution, but included in 

the contract to obtain the conservation 

benefits agreed upon, must be operated 

and maintained as specified in the 

contract and [Operation and 

Maintenance] agreement.’’ 

Finally, throughout 7 CFR part 1466, 

NRCS simplifies the regulatory crossreferences by replacing language such as 

‘‘part 1400 of this chapter’’ with ‘‘7 CFR 

part 1400.’’ 

Summary of Request for Comments 

NRCS seeks general comments related 

to how to make the provisions easier to 

understand. In addition, NRCS seeks 

public comment related to the changes 

made to the EQIP regulation by this 

interim rule, including seeking 

comment: 

• As identified in the Executive 

Summary, on how the agency should 

estimate the public value of 

conservation resulting from assistance 

provided through EQIP; 

• as set out in Section 1466.3, on the 

definition of conservation benefits; and 

• about the irrigation waiver 

requirement, and, about whether 

acreage limitations should also be 

amongst the criteria applied to limit the 

potential impact to existing water 

supplies, whether acreage limitations 

should also be amongst the criteria 

applied to evaluating whether a waiver 

on Tribal land is appropriate, and on the 

availability of granting such a waiver 

under certain conditions. 

List of Subjects in 7 CFR Part 1466 

Agricultural operations, Conservation 

practices, Conservation payments, 

Natural resources, Payment rates, 

Contract, Animal feeding operations, 

Soil and water conservation, Soil 

quality, Water quality and water 

conservation, Wildlife, and Forestry 

management. 

Regulatory Changes 

■ For the reasons stated in the preamble, 

the Natural Resources Conservation 

Service and the Commodity Credit 

Corporation revise part 1466 of Title 7 

of the Code of Federal Regulations (CFR) 

to read as follows: 

PART 1466—ENVIRONMENTAL 

QUALITY INCENTIVES PROGRAM 

Subpart A—General Provisions 

Sec. 

1466.1 Applicability. 

1466.2 Administration. 

1466.3 Definitions. 

1466.4 National priorities. 

1466.5 Outreach activities. 

1466.6 Program requirements. 

1466.7 EQIP plan of operations. 

1466.8 Conservation practices. 

1466.9 Technical services provided by 

qualified personnel not affiliated with 

USDA. 

Subpart B—Contracts and Payment 

1466.20 Applications for contracts and 

selecting applications. 

1466.21 Contract requirements. 

1466.22 Conservation practice operation 

and maintenance. 

1466.23 Payment rates. 

1466.24 EQIP payments. 

1466.25 Contract modifications and 

transfers of land. 

1466.26 Contract violations and 

terminations. 

1466.27 Conservation Innovation Grants. 

Subpart C—General Administration 

1466.30 Appeals. 

1466.31 Compliance with regulatory 

measures. 

1466.32 Access to operating unit. 

1466.33 Equitable relief. 

1466.34 Offsets and assignments. 

1466.35 Misrepresentation and scheme and 

device. 

1466.36 Environmental credits for 

conservation improvements. 

Authority: 15 U.S.C. 714b and 714c; 16 

U.S.C. 3839aa–3839–8. 

Subpart A—General Provisions 

§ 1466.1 Applicability. 

(a) The purposes of the Environmental 

Quality Incentives Program (EQIP) are to 

promote agricultural production, forest 

management, and environmental quality 

as compatible goals, and to optimize 

environmental benefits. Through EQIP, 

NRCS provides technical and financial 

assistance to eligible agricultural 

producers, including nonindustrial 

private forest landowners (NIPF) and 

Indian Tribes, to help implement 

conservation practices which address 

soil, water, and air quality; wildlife 

habitat; surface and groundwater 

conservation; energy conservation; and 

related resource concerns. EQIP’s 

financial and technical assistance helps 

producers comply with environmental 

regulations and enhance agricultural 

and forested lands in a cost-effective 

and environmentally beneficial manner. 

The purposes of the program are 

achieved by planning and implementing 

conservation practices on eligible land. 

(b) EQIP is available in any of the 50 

States, District of Columbia, 

Commonwealth of Puerto Rico, Guam, 

Virgin Islands of the United States, 

American Samoa, and Commonwealth 

of the Northern Mariana Islands. 

(c) Contracts enrolled into EQIP prior 

to February 7, 2014, are subject to the 

regulations in effect the date prior to 

February 7, 2014. 

§ 1466.2 Administration. 

(a) The funds, facilities, and 

authorities of the CCC are available to 

NRCS for carrying out EQIP. 

Accordingly, where NRCS is mentioned 

in this part, it also refers to the CCC’s 

funds, facilities, and authorities where 

applicable. 

(b) NRCS supports locally-led 

conservation by soliciting input from 

the State Technical Committee and the 

Tribal Conservation Advisory Council at 

the State level, and local working 

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groups at the county, parish, or Tribal 

level to advise NRCS on issues relating 

to EQIP implementation. 

Recommendations from the State 

Technical Committee and the Tribal 

Conservation Advisory Council may 

include but are not limited to: 

(1) Recommendation for program 

priorities and criteria; 

(2) Identification of priority resource 

concerns; 

(3) Recommendation of which 

conservation practices will be effective 

to treat identified priority resource 

concerns; and 

(4) Recommendation of program 

payment percentages for payment 

schedules. 

(c) No delegation in the 

administration of this part to lower 

organizational levels will preclude the 

Chief from making any determinations 

under this part, re-delegating to other 

organizational levels, or from reversing 

or modifying any determination made 

under this part. The Chief may modify 

or waive a discretionary provision of 

this part with respect to contracts 

entered into under the Regional 

Conservation Partnership Program 

(RCPP), if the Chief determines that 

such an adjustment is necessary to 

achieve the purposes of EQIP. 

Consistent with section 1271C(c)(3) of 

the 2014 Act, the Chief may also waive 

the applicability of the Adjusted Gross 

Income (AGI) limitation in section 

1001D(b)(2) of the Food Security Act of 

1985 for program participants if the 

Chief determines that the waiver is 

necessary to fulfill RCPP objectives. 

(d) NRCS may enter into agreements 

with other Federal or State agencies, 

Indian Tribes, conservation districts, 

units of local government, public or 

private organizations, and individuals to 

assist NRCS with implementation of the 

program in this part. 

§ 1466.3 Definitions. 

The following definitions will apply 

to this part and all documents issued in 

accordance with this part, unless 

specified otherwise: 

Agricultural land means cropland, 

grassland, rangeland, pasture, and other 

agricultural land, on which agricultural 

and forest-related products or livestock 

are produced and resource concerns 

may be addressed. Other agricultural 

lands include cropped woodland, 

marshes, incidental areas included in 

the agricultural operation, and other 

types of agricultural land used for 

production of livestock. 

Agricultural operation means a parcel 

or parcels of land whether contiguous or 

noncontiguous, which the producer is 

listed as the operator or owner/operator 

in the Farm Service Agency (FSA) 

record system, which is under the 

effective control of the producer at the 

time the producer applies for a contract, 

and which is operated by the producer 

with equipment, labor, management, 

and production, forestry, or cultivation 

practices that are substantially separate 

from other operations. 

Animal feeding operation (AFO) 

means an agricultural operation where 

animals are kept and raised in confined 

situations. AFOs congregate animals, 

feed, manure, dead animals, and 

production operations on a small land 

area. Feed is brought to the animals 

rather than the animals grazing or 

otherwise seeking feed in pastures, 

fields, or on rangeland. An AFO is a lot 

or facility (other than an aquatic animal 

production facility) where the following 

conditions are met: 

(1) Animals have been, are, or will be 

stabled or confined and fed or 

maintained for a total of 45 days or more 

in any 12-month period; and 

(2) Crops, vegetation, forage growth, 

or post-harvest residues are not 

sustained in the normal growing season 

over any portion of the lot or facility. 

Animal waste storage or treatment 

facility means a structural conservation 

practice, implemented on an AFO 

consistent with the requirements of a 

Comprehensive Nutrient Management 

Plan (CNMP) and Field Office Technical 

Guide (FOTG), which is used for 

storing, treating, or handling animal 

waste or byproducts, such as animal 

carcasses. 

Applicant means a producer who has 

requested in writing to participate in 

EQIP. 

At-risk species means any plant or 

animal species listed as threatened or 

endangered; proposed or candidate for 

listing under the Endangered Species 

Act; a species listed as threatened or 

endangered under State law or Tribal 

law on Tribal land; State or Tribal land 

species of conservation concern; or 

other plant or animal species or 

community, as determined by the State 

Conservationist, with advice from the 

State Technical Committee or Tribal 

Conservation Advisory Council, that has 

undergone, or is likely to undergo, 

population decline and may become 

imperiled without direct intervention. 

Beginning farmer or rancher means a 

person, Indian Tribe, Tribal 

corporation,, or legal entity who: 

(1) Has not operated a farm or ranch, 

or NIPF, or who has operated a farm, 

ranch, or NIPF for not more than ten 

consecutive years. This requirement 

applies to all members of an entity, who 

will materially and substantially 

participate in the operation of the farm 

or ranch. 

(2) In the case of a contract with an 

individual, individually, or with the 

immediate family, material and 

substantial participation requires that 

the individual provide substantial dayto-day labor and management of the 

farm or ranch, consistent with the 

practices in the county or State where 

the farm is located. 

(3) In the case of a contract with an 

entity or joint operation, all members 

must materially and substantially 

participate in the operation of the farm 

or ranch. Material and substantial 

participation requires that each of the 

members provide some amount of the 

management, or labor and management 

necessary for day-to-day activities, such 

that if each of the members did not 

provide these inputs, operation of the 

farm or ranch would be seriously 

impaired. 

Chief means the Chief of NRCS, 

United States Department of Agriculture 

(USDA), or designee. 

Comprehensive Nutrient Management 

Plan means a conservation plan that is 

specifically for an AFO. A CNMP 

identifies conservation practices and 

management activities which, when 

implemented as part of a conservation 

system, will manage sufficient 

quantities of manure, waste water, or 

organic by-products associated with a 

waste management facility. A CNMP 

incorporates practices to use animal 

manure and organic by-products as a 

beneficial resource while protecting all 

natural resources including water and 

air quality associated with an AFO. A 

CNMP is developed to assist an AFO 

owner/operator in meeting all 

applicable local, Tribal, State, and 

Federal water quality goals or 

regulations. For nutrient impaired 

stream segments or water bodies, 

additional management activities or 

conservation practices may be required 

by local, Tribal, State, or Federal water 

quality goals or regulations. 

Conservation benefit means the 

improved condition of a natural 

resource concern resulting from the 

implementation of a conservation 

practice. 

Conservation district means any 

district or unit of State, Tribal, or local 

government formed under State, Tribal, 

or territorial law for the express purpose 

of developing and carrying out a local 

soil and water conservation program. 

Such district or unit of government may 

be referred to as a ‘‘conservation 

district,’’ ‘‘soil conservation district,’’ 

‘‘soil and water conservation district,’’ 

‘‘resource conservation district,’’ ‘‘land 

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conservation committee,’’ ‘‘natural 

resource district,’’ or similar name. 

Conservation Innovation Grants (CIG) 

means competitive grants made under 

EQIP to individuals, Indian Tribes, and 

governmental and nongovernmental 

organizations to stimulate and transfer 

innovative technologies and 

approaches, to leverage Federal funds, 

and to enhance and protect the 

environment in conjunction with 

agricultural production and forest 

management. 

Conservation practice means one or 

more conservation improvements and 

activities, including structural practices, 

land management practices, vegetative 

practices, forest management practices, 

and other improvements that achieve 

the program purposes, including such 

items as CNMPs, agricultural energy 

management plans, dryland transition 

plans, forest management plans, 

integrated pest management, and other 

plans or activities determined 

acceptable by the Chief. Approved 

conservation practices are listed in the 

NRCS FOTG. 

Contract means a legal document that 

specifies the rights and obligations of 

any participant accepted into the 

program. An EQIP contract is a binding 

agreement for the transfer of assistance 

from USDA to the participant to share 

in the costs of implementing 

conservation practices. 

Cost-effectiveness means the least 

costly option for achieving a given set 

of conservation objectives to address a 

resource concern. 

Enrolled land means the land area 

identified and included in the program 

contract at the time when funds have 

been obligated. 

EQIP plan of operations means the 

document that identifies the location 

and timing of conservation practices 

that the participant agrees to implement 

on eligible land enrolled in the program 

in order to address the priority resource 

concerns, optimize environmental 

benefit, and address program purposes 

as defined in § 1466.1. The EQIP plan of 

operations is part of the EQIP contract. 

Estimated income foregone means an 

estimate of the net income loss 

associated with the adoption of a 

conservation practice. Along with other 

estimated incurred costs, foregone 

income is one of the costs associated 

with practice implementation as 

recorded in a payment schedule. NRCS 

calculates foregone income as the 

average annual net income ($/unit/year) 

lost from implementing a conservation 

practice which results in a change in 

land use or land taken out of production 

or the opportunity cost associated with 

the adoption of a conservation practice. 

Foregone income will not include losses 

of income due to disaster or other events 

unrelated to the conservation practice 

such as risk associated with agricultural 

production. 

Field office technical guide (FOTG) 

means the official local NRCS source of 

resource information and interpretations 

of guidelines, criteria, and requirements 

for planning and implementation of 

conservation practices. It contains 

detailed information on the quality 

standards to achieve conservation of 

soil, water, air, plant, energy, and 

animal resources applicable to the local 

area for which it is prepared. 

Forest management plan means a sitespecific plan that is prepared by a 

professional resource manager, in 

consultation with the participant, and is 

approved by the State Conservationist. 

Forest management plans may include a 

forest stewardship plan, as specified in 

section 5 of the Cooperative Forestry 

Assistance Act of 1978 (16 U.S.C. 

2103a); another practice plan approved 

by the State Forester or Indian Tribe; or 

another plan determined appropriate by 

the State Conservationist. The plan is 

intended to comply with Federal, State, 

Tribal, and local laws, regulations, and 

permit requirements. 

Habitat development means the 

application of conservation practices to 

establish, improve, protect, enhance, or 

restore the conditions of the land for the 

specific purpose of improving 

conditions for fish and wildlife. 

Historically underserved producer 

means a person, joint operation, legal 

entity, or Indian Tribe who is a 

beginning farmer or rancher, socially 

disadvantaged farmer or rancher, or 

limited resource farmer or rancher. 

Indian land means: 

(1) Land held in trust by the United 

States for individual Indians or Indian 

Tribes; or 

(2) Land, the title to which is held by 

individual Indians or Indian Tribes 

subject to Federal restrictions against 

alienation or encumbrance; or 

(3) Land which is subject to rights of 

use, occupancy and/or benefit of certain 

Indian Tribes; or 

(4) Land held in fee title by an Indian, 

Indian family, or Indian Tribe. 

Indian Tribe means any Indian Tribe, 

band, nation, pueblo, 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 (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. 

Integrated pest management means a 

sustainable approach to managing pests 

by combining biological, cultural, 

physical, and chemical tools in a way 

that minimizes economic, health, and 

environmental risks. 

Joint operation means, as defined in 

part 7 CFR 1400, a general partnership, 

joint venture, or other similar business 

organization in which the members are 

jointly and severally liable for the 

obligations of the organization. 

Legal entity means, as defined in 7 

CFR 1400, an entity created under 

Federal or State law that: 

(1) Owns land or an agricultural 

commodity, product, or livestock; or 

(2) Produces an agricultural 

commodity, product, or livestock. 

Lifespan means the period of time 

during which a conservation practice or 

activity should be maintained and used 

for the intended purpose. 

Limited resource farmer or rancher 

means either: 

(1) Individual Producer: 

(i) A person with direct or indirect 

gross farm sales not more than the 

current indexed value in each of the 

previous two fiscal years (adjusted for 

inflation using Prices Paid by Farmer 

Index as compiled by National 

Agricultural Statistical Service), and 

(ii) Has a total household income at or 

below the national poverty level for a 

family of four, or less than 50 percent 

of county median household income in 

each of the previous two years (to be 

determined annually using Commerce 

Department Data), or 

(2) A legal entity or joint operation if 

all individual members independently 

qualify under paragraph (1) of this 

definition. 

Liquidated damages means a sum of 

money stipulated in the EQIP contract 

that the participant agrees to pay NRCS 

if the participant fails to adequately 

complete the terms of the contract. The 

sum represents an estimate of the 

technical assistance expenses incurred 

to service the contract, and reflects the 

difficulties of proof of loss and the 

inconvenience or nonfeasibility of 

otherwise obtaining an adequate 

remedy. 

Livestock means all domesticated 

animals produced on farms or ranches, 

as determined by the Chief. 

Livestock production means farm or 

ranch operations involving the 

production, growing, raising, or 

reproduction of domesticated livestock 

or livestock products. 

Local working group means the 

advisory body as defined in part 610 of 

this title. 

National Organic Program means the 

national program established under the 

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Organic Foods Production Act of 1990 

(7 U.S.C. 6501 et seq.), administered by 

the Agricultural Marketing Service, 

which regulates the standards for any 

farm, wild crop harvesting, or handling 

operation that wants to sell an 

agricultural product as organically 

produced. 

National priorities means resource 

issues identified by the Chief, with 

advice from other Federal agencies, 

Indian Tribes, and State 

Conservationists, which will be used to 

determine the distribution of EQIP 

funds and guide local EQIP 

implementation. 

Natural Resources Conservation 

Service is an agency of USDA, which 

has responsibility for administering 

EQIP using the funds, facilities, and 

authorities of the CCC. 

Nonindustrial private forest land 

means rural land, as determined by the 

Secretary, that has existing tree cover or 

is suitable for growing trees; and is 

owned by any nonindustrial private 

individual, group, association, 

corporation, Indian Tribe, or other 

private legal entity that has definitive 

decision-making authority over the 

land. 

Operation and maintenance (O&M) 

means work performed by the 

participant to keep the applied 

conservation practice functioning for 

the intended purpose during the 

conservation practice lifespan. 

Operation includes the administration, 

management, and performance of 

nonmaintenance actions needed to keep 

the completed practice functioning as 

intended. 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. 

O&M agreement means the document 

that, in conjunction with the EQIP plan 

of operations, specifies the operation 

and maintenance responsibilities of the 

participant for conservation practices 

installed with EQIP assistance. 

Organic system plan (OSP) means a 

management plan for organic 

production or for an organic handling 

operation that has been agreed to by the 

producer or handler and the certifying 

agent. The OSP includes all written 

plans that govern all aspects of 

agricultural production or handling as 

required under the Organic Foods 

Production Act of 1990 (7 U.S.C. 6501 

et seq.). 

Participant means an applicant that 

has entered into an EQIP contract who 

incurs the cost of practice 

implementation, will receive payment 

or is responsible for implementing the 

terms and conditions of an EQIP 

contract. 

Payment means financial assistance 

provided to the participant based on the 

estimated costs incurred in performing 

or implementing conservation practices, 

including costs for: planning, design, 

materials, equipment, installation, 

labor,, management, or training, as well 

as the estimated income foregone by the 

producer for designated conservation 

practices. 

Person means, as defined in 7 CFR 

part 1400, an individual, natural person, 

and does not include a legal entity. 

Priority resource concern means a 

natural resource concern that is 

identified by the State Conservationist, 

in consultation with the State Technical 

Committee or Tribal Conservation 

Advisory Council, as a priority for a 

State, Tribal, local, geographic area, or 

watershed level. 

Producer means a person, legal entity, 

Indian Tribe, or joint operation who 

NRCS determines is engaged in 

agricultural production or forestry 

management on the agricultural 

operation. 

Resource concern means a specific 

natural resource problem that represents 

a significant concern in a State or region 

and is likely to be addressed through the 

implementation of conservation 

practices or activities by producers 

according to NRCS technical standards. 

Socially disadvantaged farmer or 

rancher means a producer who is a 

member of a group whose members 

have been subjected to racial or ethnic 

prejudices without regard to its 

members’ individual qualities. For an 

entity, at least 50 percent ownership in 

the business entity must be held by 

socially disadvantaged individuals. 

State Conservationist means the 

NRCS employee authorized to 

implement EQIP and direct and 

supervise NRCS activities in a State, 

Caribbean Area, or Pacific Island Areas. 

State Technical Committee means a 

committee established by NRCS in a 

State pursuant to 7 CFR part 610, 

subpart C. 

Structural practice means a 

conservation practice, including a 

vegetative practice, that involves 

establishing, constructing, or installing a 

site-specific measure to conserve and 

protect a resource from degradation, or 

improve soil, water, air, or related 

natural resources in the most costeffective manner. Examples include, but 

are not limited to, animal waste 

management facilities, terraces, grassed 

waterways, tailwater pits, livestock 

water developments, contour grass 

strips, filter strips, critical area 

plantings, tree plantings, establishment 

or improvement of wildlife habitat, and 

capping of abandoned wells. 

Technical assistance means technical 

expertise, information, training, 

education, and tools necessary for a 

producer to be able to successfully 

implement, operate, and maintain 

conservation practices to ensure the 

conservation of natural resources on 

land active in agricultural, forestry, or 

related uses. These technical services 

include the following: 

(1) Technical services provided 

directly to farmers, ranchers, Indian 

Tribes, and other eligible entities, such 

as conservation planning, technical 

consultation, and assistance with design 

and implementation of conservation 

practices; and 

(2) Technical infrastructure, including 

activities, processes, tools, and agency 

functions needed to support delivery of 

technical services, such as technical 

standards, resource inventories, 

training, education, data, technology, 

monitoring, and effects analyses. 

Technical service provider (TSP) 

means an individual, private-sector 

entity, Indian Tribe, or public agency 

either: 

(1) Certified by NRCS pursuant to 7 

CFR part 652 and placed on the 

approved list to provide technical 

services to participants; or 

(2) Selected by the Department to 

assist the Department in the 

implementation of conservation 

programs covered by this part through a 

procurement contract, contributions 

agreement, or cooperative agreement 

with the Department. 

Tribal Conservation Advisory Council 

means, in lieu of or in addition to 

forming a Tribal conservation district, 

an Indian Tribe may elect to designate 

an advisory council to provide input on 

NRCS programs and the conservation 

needs of the Tribe and Tribal producers. 

The advisory council may be an existing 

Tribal committee or department, and 

may also constitute an association of 

member Tribes organized to provide 

direct consultation to NRCS at the State, 

regional, and national levels to provide 

input on NRCS rules, policies, and 

programs and their impacts on Tribes. 

Veteran farmer or rancher means a 

producer who meets the definition in 

section 2501(e) of the Food, Agriculture, 

Conservation, and Trade Act of 1990, as 

amended (7 U.S.C. 2279(e)). 

Wildlife means non-domesticated 

birds, fishes, reptiles, amphibians, 

invertebrates, and mammals. 

Wildlife habitat means the aquatic 

and terrestrial environments required 

for fish and wildlife to complete their 

life cycles, providing air, food, cover, 

water, and spatial requirements. 

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§ 1466.4 National priorities. 

(a) The following national priorities, 

consistent with statutory resources 

concerns that include soil quality, water 

quality and quantity, plants, energy, 

wildlife habitat, air quality, and related 

natural resource concerns, may be used 

in EQIP implementation: 

(1) Reductions of nonpoint source 

pollution, such as nutrients, sediment, 

pesticides, or excess salinity in 

impaired watersheds consistent with 

total maximum daily loads (TMDL) 

where available; the reduction of surface 

and groundwater contamination; and 

the reduction of contamination from 

agricultural sources, such as animal 

feeding operations; 

(2) Conservation of ground and 

surface water resources; 

(3) Reduction of emissions, such as 

particulate matter, nitrogen oxides, 

volatile organic compounds, and ozone 

precursors and depleters that contribute 

to air quality impairment violations of 

National Ambient Air Quality 

Standards; 

(4) Reduction in soil erosion and 

sedimentation from unacceptable levels 

on agricultural land; 

(5) Promotion of at-risk species 

habitat conservation including 

development and improvement of 

wildlife habitat; and 

(6) Energy conservation to help save 

fuel, improve efficiency of water use, 

maintain production, and protect soil 

and water resources by more efficiently 

using fertilizers and pesticides. 

(b) In consultation with other Federal 

agencies and Indian Tribes, NRCS may 

undertake periodic reviews of the 

national priorities and the effects of 

program delivery at the State and local 

levels to adapt the program to address 

emerging resource issues. NRCS may: 

(1) Use the national priorities to guide 

the allocation of EQIP funds to the 

NRCS State offices; 

(2) Use the national priorities in 

conjunction with State, Indian Tribes, 

and local priorities to assist with 

prioritization and selection of EQIP 

applications; and 

(3) Periodically review and update the 

national priorities utilizing input from 

the public, Indian Tribes, other Federal 

and State agencies, and affected 

stakeholders to ensure that the program 

continues to address priority resource 

concerns. 

§ 1466.5 Outreach activities. 

NRCS will establish program outreach 

activities at the national, State, Tribal, 

and local levels in order to ensure that 

producers whose land has 

environmental problems and priority 

resource concerns are aware and 

informed that they may be eligible to 

apply for program assistance. Special 

outreach will be made to eligible 

producers with historically low 

participation rates, including but not 

restricted to, limited resource, socially 

disadvantaged, small-scale, or beginning 

farmers or ranchers, veteran farmers or 

ranchers, Indian Tribes, Alaska Natives, 

and Pacific Islanders. NRCS provides 

outreach so as not to limit producer 

participation because of size or type of 

operation, or production system, 

including small-scale, specialty crop, 

and organic production. 

§ 1466.6 Program requirements. 

(a) Program participation is voluntary. 

An applicant must develop an EQIP 

plan of operations for the eligible land 

to be treated that serves as the basis for 

the EQIP contract. Under EQIP, NRCS 

provides its participants with technical 

assistance and payments to plan and 

apply needed conservation practices. 

(b) To be eligible to participate in 

EQIP, an applicant must: 

(1) Be in compliance with the highly 

erodible land and wetland conservation 

provisions found at part 12 of this title; 

(2) Must be a producer as determined 

by NRCS; 

(3) Have control of the land for the 

term of the proposed contract unless an 

exception is made by the Chief in the 

case of land administered by the Bureau 

of Indian Affairs (BIA), Indian lands, or 

other instances in which the Chief 

determines that there is sufficient 

assurance of control; 

(i) The Chief may determine that land 

administered by BIA, Indian land, or 

other such circumstances provides 

sufficient assurance of control, and 

(ii) If the applicant is a tenant of the 

land involved in agricultural production 

or forestry management, the applicant 

will provide the Chief with the written 

concurrence of the landowner in order 

to apply a structural practice; 

(4) Agree to implement the EQIP plan 

of operations according to the 

provisions and conditions established in 

the EQIP contract, including the EQIP 

contract appendix; 

(5) Submit an EQIP plan of operations 

or plan developed for the purposes of 

acquiring an air or water quality permit, 

provided these plans contain elements 

equivalent to those elements required by 

an EQIP plan of operations and are 

acceptable to NRCS as being consistent 

with the purposes of the program; 

(6) Supply information, as required by 

NRCS, to determine eligibility for the 

program, including but not limited to, 

information to verify the applicant’s 

status as a limited resource, beginning 

farmer or rancher, and payment 

eligibility as established by 7 CFR part 

1400; 

(7) Comply with applicable 

registration and reporting requirements 

of the Federal Funding Accountability 

and Transparency Act of 2006 (Pub. L. 

109–282, as amended), and 2 CFR parts 

25 and 170; and 

(8) Provide a list of all members of the 

legal entity and embedded entities along 

with members’ tax identification 

numbers and percentage interest in the 

entity. 

(c) Eligible land includes cropland, 

grassland, rangeland, pasture, NIPF, and 

other land on which agricultural 

products, livestock, or forest-related 

products are produced and resource 

concerns may be addressed. Other 

agricultural lands include cropped 

woodland, marshes, incidental areas 

included in the agricultural operation, 

and other types of agricultural land used 

for production of livestock. However, 

land may be considered for enrollment 

in EQIP only if NRCS determines that 

the land is: 

(1) Privately owned land; or 

(2) Publicly owned land where: 

(i) The land is a working component 

of the participant’s agricultural and 

forestry operation, 

(ii) The participant has control of the 

land for the term of the contract, and 

(iii) The conservation practices to be 

implemented on the public land are 

necessary and will contribute to an 

improvement in the identified resource 

concern; or 

(3) Indian land. 

§ 1466.7 EQIP plan of operations. 

(a) All conservation practices in the 

EQIP plan of operations must be 

approved by NRCS and developed and 

carried out in accordance with the 

applicable NRCS planning and FOTG 

technical requirements. 

(b) The participant is responsible for 

implementing the EQIP plan of 

operations according to the approved 

implementation schedule. 

(c) The EQIP plan of operations must 

include: 

(1) A description of the participant’s 

specific conservation objectives to be 

achieved; 

(2) To the extent practicable, the 

quantitative or qualitative goals for 

achieving the participant’s conservation 

and natural resource objectives; 

(3) A description of one or more 

conservation practices in the 

conservation management system, 

including conservation planning, 

design, or installation activities to be 

implemented to achieve the 

conservation objectives; 

(4) A description of the schedule for 

implementing the conservation 

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practices, including timing, sequence, 

operation, and maintenance; and 

(5) Information that will enable 

evaluation of the effectiveness of the 

plan in achieving the conservation 

objectives. 

(d) If an EQIP plan of operations 

includes an animal waste storage or 

treatment facility to be implemented on 

an AFO, the participant must agree to 

develop and implement a CNMP by the 

end of the contract period. 

(e) If an EQIP plan of operations 

includes conservation practices that 

address forest land related resource 

concerns, the participant must develop 

and implement a forest management 

plan by the end of the contract period. 

(f) A participant may receive 

assistance to implement an EQIP plan of 

operations which includes irrigation 

related practices to address a water 

conservation resource concern only if 

the assistance will facilitate a reduction 

in ground or surface water use on the 

agricultural operation, unless the 

producer is participating in a 

watershed-wide project, as approved by 

the State Conservationist, which will 

effectively conserve water in accordance 

with § 1466.20. 

§ 1466.8 Conservation practices. 

(a) NRCS will determine the 

conservation practices for which 

participants may receive program 

payments. NRCS will provide a list of 

eligible practices to the public as 

approved in the NRCS FOTG. 

(b) Payment will not be made to a 

participant for conservation practice 

that: 

(1) Either the applicant or another 

producer has initiated or implemented 

prior to application for the program; or 

(2) Has been initiated or implemented 

prior to contract approval, unless a 

waiver was granted by the Chief prior to 

the practice implementation. 

(c) A participant will be eligible for 

payments for water conservation and 

irrigation related conservation practices 

only on land that has been irrigated for 

2 of the last 5 years prior to application 

for assistance. This irrigation history 

requirement may be waived for 

circumstances as determined by the 

Chief. 

(d) Where new technologies or 

management approaches that provide a 

high potential for optimizing 

conservation benefits have been 

developed, NRCS may approve interim 

conservation practice standards that 

incorporate the new technologies and 

provide financial assistance for pilot 

work to evaluate and assess the 

performance, efficiency, and 

effectiveness of the new technology or 

management approach. 

(e) NRCS will at least annually 

consult with State Technical 

Committees, Tribal Conservation 

Advisory Councils, local work groups, 

and other stakeholders to identify 

conservation practices with appropriate 

purposes and the criteria for their 

application to address priorities to 

establish wildlife habitat including: 

(1) Upland wildlife habitat; 

(2) Wetland wildlife habitat; 

(3) Habitat for threatened and 

endangered species; 

(4) Fish habitat; 

(5) Habitat on pivot corners and other 

irregular areas of a field, and 

(6) Other types of wildlife habitat, as 

determined by NRCS. 

§ 1466.9 Technical services provided by 

qualified personnel not affiliated with 

USDA. 

(a) NRCS may use the services of 

qualified third party technical service 

providers in its delivery of EQIP 

technical assistance in accordance with 

7 CFR part 652. 

(b) Participants may obtain technical 

services from certified technical service 

providers in accordance with 7 CFR part 

652. 

(c) NRCS retains approval authority of 

work done by non-NRCS personnel for 

the purpose of approving EQIP 

payments. 

Subpart B—Contracts and Payment 

§ 1466.20 Application for contracts and 

selecting applications. 

(a) In evaluating EQIP applications, 

NRCS, with advice from the State 

Technical Committee, Tribal 

Conservation Advisory Council, or local 

working group takes into account the 

following guidelines: 

(1) Any producer who has eligible 

land may submit an application for 

participation in EQIP. Applications may 

be accepted on a continuous basis 

throughout the year. Producers who are 

members of a joint operation may file a 

single application for ranking purposes 

for the joint operation. 

(2) NRCS, to the greatest extent 

practicable, will group applications of 

similar crop, forestry, and livestock 

operations for evaluation purposes. 

(b) In selecting EQIP applications, 

NRCS, with advice from the State 

Technical Committee, Tribal 

Conservation Advisory Council, or local 

working group, may establish ranking 

pools to address a specific resource 

concern, geographic area, or agricultural 

operation type or develop a ranking 

process to prioritize applications for 

funding that address national, State, and 

local priority resource concerns, taking 

into account the following guidelines: 

(1) NRCS will periodically select the 

highest ranked applications for funding 

based on applicant eligibility, fund 

availability, and the NRCS ranking 

process. NRCS will rank all applications 

according to the following factors 

related to conservation benefits to 

address identified resource concerns 

through implementation of conservation 

practices: 

(i) The degree of cost-effectiveness of 

the proposed conservation practices, 

(ii) The magnitude of the expected 

conservation benefits resulting from the 

conservation treatment and the priority 

of the resource concerns that have been 

identified at the local, State, and 

national levels, 

(iii) How effectively and 

comprehensively the project addresses 

the designated resource concern or 

resource concerns, 

(iv) Use of conservation practices that 

provide long-term conservation 

enhancements, 

(v) Compliance with Federal, State, 

Tribal, or local regulatory requirements 

concerning soil, water, and air quality; 

wildlife habitat; and ground and surface 

water conservation, 

(vi) Willingness of the applicant to 

complete all conservation practices in 

an expedited manner, 

(vii) The ability to improve existing 

conservation practices or systems which 

are in place at the time the application 

is accepted, or that complete a 

conservation system, and 

(viii) Other locally defined pertinent 

factors, such as the location of the 

conservation practice, the extent of 

natural resource degradation, and the 

degree of cooperation by local producers 

to achieve environmental 

improvements. 

(2) For applications that include water 

conservation or irrigation-related 

practices, and consistent with State law 

in which the applicant’s eligible land is 

located, NRCS may give priority to those 

applications that: 

(i) Result in a reduction in water use 

in the agricultural operation, or 

(ii) Include an agreement by the 

applicant not to use any associated 

water savings to bring new land (other 

than incidental land needed for efficient 

operations) under irrigation production 

unless the producer is participating in a 

watershed-wide project that will 

effectively conserve water. NRCS may 

designate eligible watershed-wide 

projects that effectively conserve water, 

using the following criteria: 

(A) The project area has a current, 

comprehensive water resource 

assessment, 

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(B) The project plan has demonstrated 

effective water conservation 

management strategies, and 

(C) The project sponsors have 

consulted relevant State and local 

agencies. 

(3) If NRCS determines that the 

conservation benefits of two or more 

applications for payments are 

comparable, NRCS may not assign a 

higher priority to the application solely 

because it would present the least cost 

to the program. 

(4) The ranking score may not give 

preferential treatment to applications 

based on size of the operation, income 

generated from the operation, type of 

operation, or other factors not related to 

conservation benefits to address a 

resource concern unless authorized in 

this rule. 

(5) The ranking process will 

determine the order in which 

applications will be selected for 

funding. The approving authority for 

EQIP contracts will be NRCS. 

(6) NRCS will make available to the 

public all information regarding priority 

resource concerns, the list of eligible 

practices, payment rates, and how EQIP 

is implemented in a State. 

§ 1466.21 Contract requirements. 

(a) In order for a participant to receive 

payments, the participant must enter 

into a contract agreeing to implement 

one or more conservation practices. 

Payment for technical services may be 

included in the contract pursuant to 

requirements of this part. 

(b) An EQIP contract will: 

(1) Identify all conservation practices 

to be implemented, the timing of 

practice installation, the operation and 

maintenance requirements for the 

practices, and applicable payments 

allocated to the practices under the 

contract; 

(2) Have a term for not more than 10 

years; 

(3) Incorporate all provisions as 

required by law or statute, including 

requirements that the participant will: 

(i) Not implement any practices on 

the enrolled land that would defeat the 

program’s purposes, 

(ii) Refund any program payments 

received with interest, and forfeit any 

future payments under the program, on 

the violation of a term or condition of 

the contract, consistent with the 

provisions of § 1466.26, 

(iii) Refund all program payments 

received on the transfer of the right and 

interest of the producer in land subject 

to the contract, unless the transferee of 

the right and interest agrees to assume 

all obligations, including operation and 

maintenance of the EQIP contract’s 

conservation practices, consistent with 

the provisions of § 1466.25, 

(iv) Develop and implement a CNMP 

when the EQIP contract includes an 

animal waste management facility on an 

AFO by the end of the contract period, 

(v) Implement a forest management 

plan when the EQIP plan of operations 

includes forest-related practices that 

address resource concerns on NIPF, 

(vi) Supply information as may be 

required by NRCS to determine 

compliance with contract and program 

requirements, and 

(vii) Specify the participant’s 

responsibilities for operation and 

maintenance of the applied 

conservation practices, consistent with 

the provisions of § 1466.22; and 

(4) Specify any other provision 

determined necessary or appropriate by 

NRCS to achieve the technical 

requirements of a practice or purposes 

of the program. 

(c) The participant must start at least 

one financially assisted practice within 

the first 12 months of signing a contract. 

If a participant, for reasons beyond their 

control, is unable to start conservation 

practice within the first year of the 

contract, the participant can request a 

modification from NRCS. 

(d) Each contract will be limited to no 

more than $450,000, unless the contract 

is with an Indian Tribe. Contracts 

related to organic operations are also 

subject to payment limitations pursuant 

to § 1466.24(b). 

§ 1466.22 Conservation practice operation 

and maintenance (O&M). 

(a) The contract will incorporate the 

O&M agreement that addresses the 

operation and maintenance of 

conservation practices applied under 

the contract. 

(b) NRCS expects the participant to 

operate and maintain each conservation 

practice installed under the contract for 

its intended purpose for the 

conservation practice lifespan as 

specified in the O&M agreement. 

(c) Conservation practices installed 

before the contract execution, but 

included in the contract to obtain the 

conservation benefits agreed upon, must 

be operated and maintained as specified 

in the contract and O&M agreement. 

(d) NRCS may periodically inspect the 

conservation practice during the 

contract duration as specified in the 

O&M agreement to ensure that operation 

and maintenance requirements are being 

carried out and that the conservation 

practice is fulfilling its intended 

objectives. 

(e) If NRCS finds during the contract 

that a participant is not operating and 

maintaining practices in an appropriate 

manner, NRCS may terminate and 

request a refund of payments made for 

that conservation practice under the 

contract. 

§ 1466.23 Payment rates. 

(a) NRCS will develop a list of 

conservation practices eligible for 

payment under the program, which 

considers: 

(1) The conservation practice costeffectiveness, implementation 

efficiency, and innovation; 

(2) The degree and effectiveness in 

treating priority resource concerns; 

(3) The number of resource concerns 

the practice will address; 

(4) The longevity of the practice’s 

conservation benefit; 

(5) The conservation practice’s ability 

to assist producers in meeting regulatory 

requirements; and 

(6) Other pertinent local 

considerations. 

(b) The Chief will determine the 

process and methodology used for 

development, review, and approval of 

payment schedules to support accurate 

and cost-effective delivery of program 

benefits, including determination of 

estimated incurred costs and income 

foregone associated with 

implementation of all financiallysupported conservation practices or 

activities. 

(1) A payment to a participant for 

performing a practice may not exceed, 

as determined by NRCS, the following 

maximum payment percentages: 

(i) Estimated costs of 75 percent 

incurred by implementing the 

conservation practice, 

(ii) Estimated income foregone is 100 

percent, or 

(iii) Both conditions in paragraphs 

(b)(1)(i) and (ii) of this section, where a 

producer incurs costs in implementing 

a conservation practice and foregoes 

income related to that practice 

implementation, and 

(iv) In determining the amount and 

rate of estimated income foregone, 

NRCS may assign higher significance to 

conservation practices which promote: 

(A) Soil health; 

(B) Water quality and quantity 

improvement; 

(C) Nutrient management; 

(D) Pest management; 

(E) Air quality improvement; 

(F) Wildlife habitat development, 

including pollinator habitat; 

(G) Invasive species management; and 

(H) Other natural resource concerns of 

regional or national significance, as 

determined by NRCS. 

(2) Notwithstanding paragraph (b)(1) 

of this section, a participant that meets 

the definition of a veteran farmer or 

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rancher or the definition a historically 

underserved producer under § 1466.3 

may be awarded the applicable payment 

rate and an additional rate that is not 

less than 25 percent above the 

applicable rate, provided this increase 

does not exceed 90 percent of the 

incurred costs estimated for the 

conservation practice. 

(3) The payments to a participant 

through EQIP will be reduced 

proportionately below the contracted 

payment rate established by the Chief, 

so that the total combined payments for 

a conservation practice from EQIP and 

other USDA sources will not exceed 100 

percent of the estimated costs incurred 

for implementing or performing the 

conservation practice. 

(4) When the agency enters into a 

formal agreement with partners who 

provide financial support to help 

implement program initiatives, the 

Chief must adjust NRCS program 

payment percentages to provide practice 

payment rates to an amount such that 

the total financial assistance to the 

participant from NRCS and the partner 

does not exceed the amount needed to 

encourage voluntary adoption of the 

practice. The formal agreement must be 

approved by NRCS prior to 

announcement of the program initiative 

and adjusted payment rates. 

(5) NRCS may provide payments for 

conservation practices on some or all of 

the operations of a participant related to 

organic production and the transition to 

organic production. Payments may not 

be provided for any costs associated 

with organic certification, enterprise 

costs associated with transition to 

organic production, or for practices or 

activities that are eligible for financial 

assistance under the National Organic 

Program (7 U.S. C. 6523). 

§ 1466.24 EQIP payments. 

(a) Except for contracts entered into 

prior to February 7, 2014, which are 

subject to regulations and contract 

requirements in effect prior to February 

7, 2014, or as provided in paragraph (b) 

of this section, the total amount of 

payments paid to a person or legal 

entity under this part may not exceed an 

aggregate of $450,000, directly or 

indirectly, for all contracts entered into 

during fiscal years 2014 through 2018. 

Payments received for technical 

assistance will be excluded from this 

limitation. The limitation in this 

subsection cannot be waived. 

(b) Payments for conservation 

practices related to organic production 

to a person or legal entity, directly or 

indirectly, may not exceed in aggregate 

$20,000 per fiscal year or $80,000 

during any 6-year period. 

(c) To determine eligibility for 

payments, NRCS will use the following 

criteria: 

(1) The provisions in 7 CFR part 1400, 

Payment Limitation and Payment 

Eligibility. 

(2) States, political subdivisions, and 

entities thereof are not considered to be 

producers eligible for payment. 

(3) To be eligible to receive an EQIP 

payment, all legal entities or persons 

applying, either alone or as part of a 

joint operation, must provide a tax 

identification number and percentage 

interest in the legal entity. In 

accordance with 7 CFR part 1400, an 

applicant applying as a joint operation 

or legal entity must provide a list of all 

members of the legal entity and joint 

operation and associated embedded 

entities, along with the members’ social 

security numbers and percentage 

interest in the joint operation or legal 

entity. 

(4) Contracts with Indian Tribes are 

not subject to payment or contract 

limitations. Indian Tribes will certify in 

writing that no one individual, directly 

or indirectly, will receive more than the 

payment limitation. Certification 

provided at the time of enrollment will 

cover the entire contract period. The 

Tribal entity must also provide, upon 

request from NRCS, a listing of 

individuals and payment made, by 

Social Security number or other unique 

identification number, during the 

previous year for calculation of overall 

payment limitations. 

(i) Payment limitations apply to 

individual Tribal member(s) when 

applying and subsequently being 

granted a contract as an individual(s). 

American Indians, Alaska Natives, and 

Pacific Islanders may use another 

unique identification number for each 

individual eligible for payment. 

(ii) Any individual Tribal member 

that is identified utilizing a unique 

identification number as an alternative 

to a tax identification number will 

utilize only that identifier for all 

contracts to which the individual Tribal 

member receives a payment directly or 

indirectly. 

(5) To be eligible to receive a 

payment, all legal entities or persons 

applying, either alone or as part of a 

joint operation, must provide a tax 

identification number and percentage 

interest in the legal entity. In 

accordance with 7 CFR part 1400, an 

applicant applying as a joint operation 

or legal entity must provide a list of all 

members of the legal entity and joint 

operation and associated embedded 

entities, along with the members’ Social 

Security numbers and percentage of 

interest in the joint operation or legal 

entity. 

(6) Any cooperative association of 

producers that markets commodities for 

producers will not be considered to be 

a person eligible for payment. 

(7) Eligibility for payments in 

accordance with part 7 CFR part 1400, 

average adjusted gross income 

limitation, will be determined prior to 

contract approval. 

(8) To be eligible for payments for 

conservation practices related to organic 

production or the transition to organic 

production: 

(i) Participants who are USDA 

certified organic producers will 

implement conservation practices that 

are consistent with an approved organic 

system plan (OSP), and 

(ii) Participants who are transitioning 

to organic production (including 

participants who are exempt from 

certification as defined by the Organic 

Foods Production Act of 1990) will 

develop an OSP and implement 

conservation practices that are 

consistent with OSP requirements and 

purposes of the program. 

(9) A participant will not be eligible 

for payments for conservation practices 

on eligible land if the participant 

receives payments or other benefits for 

the same practice to address the same 

resource concern on the same land 

under any other conservation program 

administered by USDA. 

(10) NRCS may issue advance 

payments to participants that are 

historically underserved producers up 

to 50 percent of the anticipated amount 

of the costs incurred for the purpose of 

purchasing materials or services to 

implement a conservation practice. 

Eligibility for advance payment is 

contingent upon the requirement that 

the participant must obtain an NRCS 

approved practice design prior to 

approval of the advance payment. 

Advance funds paid to program 

participants must be expended within 

90 days from receipt of funds or 

returned to NRCS within a reasonable 

time as determined by NRCS. 

(11) Before NRCS will approve and 

issue any EQIP payment, the participant 

must certify that the conservation 

practice has been completed in 

accordance with contract requirements, 

and NRCS or an approved TSP must 

certify that the practice has been carried 

out in accordance with the applicable 

NRCS FOTG technical standards. 

§ 1466.25 Contract modifications and 

transfers of land. 

(a) The participant and NRCS may 

modify a contract if both parties agree 

to the contract modification, the 

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contract continues to meet the purposes 

of the program, and the contract 

modification is approved by NRCS. 

(b) It is the participant’s responsibility 

to notify NRCS when the participant 

anticipates either the voluntary or 

involuntary loss of control of the land 

covered by an EQIP contract. 

(c) The participant and NRCS may 

agree to transfer a contract to another 

party. 

(1) To receive an EQIP payment, the 

transferee must be determined by NRCS 

to be eligible to participate in EQIP and 

must assume full responsibility under 

the contract, including the O&M 

agreement for those conservation 

practices already installed and those 

conservation practices to be installed as 

a condition of the contract. 

(2) If the transferee is ineligible or 

refuses to accept future payments, NRCS 

will terminate the contract and may 

require the transferor to refund or forfeit 

all payments received. 

(d) NRCS may require a participant to 

refund all or a portion of any financial 

assistance provided under EQIP if the 

participant sells or loses control of the 

land covered by an EQIP contract and 

the new owner or controller is not 

eligible to participate in the program or 

refuses to assume responsibility under 

the contract. 

(e) In the event a conservation 

practice fails through no fault of the 

participant, NRCS may issue payments 

to re-establish the practice, at the rates 

established in accordance with 

§ 1466.23, provided such payments do 

not exceed the payment limitation 

requirements as set forth § 1466.24. 

§ 1466.26 Contract violations and 

terminations. 

(a) NRCS may terminate a contract: 

(1) Without the consent of the 

participant where it determines that the 

participant violated the contract; or 

(2) With the consent of the participant 

if NRCS determines that the termination 

is in the public interest. 

(b) NRCS may allow a participant in 

a contract terminated in accordance 

with the provisions of paragraph (a) to 

retain a portion of any payments 

received appropriate to the effort the 

participant has made to comply with the 

contract, or in cases of hardship, where 

forces beyond the participant’s control 

prevented compliance with the contract. 

The condition that is the basis for the 

participant’s inability to comply with 

the contract must not have existed at the 

time the contract was executed by the 

participant. If a participant believes that 

such a hardship condition exists, the 

participant may submit a request with 

NRCS for relief pursuant to this 

paragraph and any such request must 

contain documentation sufficient for 

NRCS to make a determination that this 

hardship condition exists. 

(c) If NRCS determines that a 

participant is in violation of the terms 

of a contract, O&M agreement, or 

documents incorporated by reference 

into the contract, NRCS may give the 

participant a period of time, as 

determined by NRCS, to correct the 

violation and comply with the terms of 

the contract and attachments thereto. If 

a participant continues to be in 

violation, NRCS may terminate the EQIP 

contract in accordance with 

§ 1466.26(e). 

(d) Notwithstanding the provisions of 

paragraph (c) of this section, a contract 

termination will be effective 

immediately upon a determination by 

NRCS that the participant: 

(1) Has submitted false information or 

filed a false claim; 

(2) Engaged in any act, scheme, or 

device for which a finding of 

ineligibility for payments is permitted 

under the provisions of § 1466.35, or 

(3) Incurred a violation of the contract 

provisions that cannot be corrected in a 

timeframe established by NRCS. 

(e) If NRCS terminates a contract due 

to breach of contract, the participant 

will forfeit all rights to future payments 

under the contract, pay liquidated 

damages, and refund all or part of the 

payments received, plus interest. 

(1) NRCS may require a participant to 

provide only a partial refund of the 

payments received if a previously 

installed conservation practice can 

function independently and is not 

adversely affected by the violation or 

the absence of other conservation 

practices that would have been installed 

under the contract. 

(2) NRCS may reduce or waive the 

liquidated damages depending upon the 

circumstances of the case. 

(3) When terminating a contract, 

NRCS may reduce the amount of money 

owed by the participant by a proportion 

that reflects the good faith effort of the 

participant to comply with the contract 

or the existence of hardships beyond the 

participant’s control that have 

prevented compliance with the contract. 

(f) NRCS may terminate a contract 

that provides payments to a participant 

for conservation practices related to 

organic production, if NRCS determines 

that the participant is not implementing 

practices according to provisions of the 

contract agreement or does not meet 

provisions of this part. 

§ 1466.27 Conservation Innovation Grants. 

(a) In addition to the terms defined in 

§ 1466.3, the following definitions will 

be applicable to this section: 

(1) EQIP eligible means any farming 

entity, land, and practice that meets the 

definitions of EQIP as defined in 7 CFR 

part 1466. 

(2) Grant agreement means a 

document describing a relationship 

between NRCS and a State or local 

government, or other recipient 

whenever the principal purpose of the 

relationship is the transfer of a thing of 

value to a recipient in order to 

accomplish a public purpose of support 

or stimulation authorized by Federal 

law and substantial Federal 

involvement is not anticipated. 

(3) Grant Review Board consists of 

representatives of NRCS staff as 

determined by the Chief. 

(4) Technical Peer Review Panel 

means a panel consisting of Federal and 

non-Federal technical advisors who 

possess expertise in a discipline or 

disciplines deemed important to 

provide a technical evaluation of project 

proposals submitted under the funding 

opportunity announcement. 

(5) Project means the activities as 

defined within the scope of the grant 

agreement or cooperative agreement. 

(6) Project director means the 

individual responsible for the technical 

direction and management of the project 

as designated in the application. 

(7) On-farm conservation research 

means an investigation conducted to 

answer a specified conservation-related 

question using a statistically valid 

design, while employing farm scale 

equipment on farm fields. 

(b) Purpose and scope. (1) The 

purpose of Conservation Innovation 

Grants (CIG) is to stimulate the 

development and adoption of 

innovative conservation approaches and 

technologies while leveraging Federal 

investment in environmental 

enhancement and protection in 

conjunction with agricultural 

production. Notwithstanding any 

limitation of this part, NRCS will 

administer CIG in accordance with this 

section. Unless otherwise provided for 

in this section, grants under CIG are 

subject to the provisions of 2 CFR 200, 

Uniform Administrative Requirements, 

Cost Principles, and Audit 

Requirements for Federal Awards. 

(2) Applications for CIG are accepted 

from the 50 States, District of Columbia, 

Caribbean Area (Puerto Rico and Virgin 

Islands of the United States), and Pacific 

Islands Area (Guam, American Samoa, 

and Commonwealth of the Northern 

Mariana Islands). 

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(3) Grants will be awarded using a 

two-tiered process. A nationwide grants 

competition will be announced in 

grants.gov or successor Federal grants 

portal. In addition, at the Chief’s 

discretion, each State may implement a 

separate State-level component of CIG. 

(4) Applications for CIG should 

demonstrate the use of innovative 

approaches and technologies to leverage 

Federal investment in environmental 

enhancement and protection, in 

conjunction with agricultural 

production. CIG will fund projects that 

promote innovative on-the-ground 

conservation, including pilot projects 

and field demonstrations of promising 

approaches or technologies. CIG projects 

are expected to lead to the transfer of 

conservation technologies, management 

systems, and innovative approaches 

(such as market-based systems) into 

NRCS technical manuals and guides or 

to the private sector. Technologies and 

approaches eligible for funding in a 

project’s geographic area through EQIP 

are not eligible for CIG funding except 

where the use of those technologies and 

approaches demonstrates clear 

innovation. The burden falls on the 

applicant to sufficiently describe the 

innovative features of the proposed 

technology or approach. 

(5) For the purposes of CIG, the 

proposed innovative project or activity 

must promote environmental protection 

or natural resources enhancement, and 

encompass development and pilot field 

testing, on-farm research and 

demonstration, evaluation, and/or 

implementation of: 

(i) Conservation adoption incentive 

systems, including market-based 

systems, or 

(ii) Promising conservation 

technologies, practices, systems, 

procedures, or approaches. 

(6) Projects or activities under CIG 

must comply with all Federal, State, and 

local regulations throughout the 

duration of the project and: 

(i) Make use of proven technology or 

a technology that has been studied 

sufficiently to indicate a high 

probability for success, 

(ii) Demonstrate, evaluate, or verify 

environmental (soil, water, air, plants, 

energy and animal) effectiveness, utility, 

affordability, and usability of 

conservation technology in the field, 

(iii) Adapt conservation technologies, 

management, practices, systems, 

procedures, approaches, and incentive 

systems to improve performance, and 

encourage adoption, 

(iv) Introduce conservation systems, 

approaches, and procedures from 

another geographic area or agricultural 

sector, or 

(v) Demonstrate transferability of 

knowledge. 

(c)(1) CIG funding will be available for 

single-or multi-year projects. Funding 

for CIG will be announced in grants.gov 

or a Federal grant portal through an 

Announcement for Program Funding 

(APF). The Chief will determine the 

funding level for CIG on an annual 

basis. Funds for CIG are derived from 

funds made available for EQIP. The 

Chief may establish funding limits for 

individual grants. 

(2) Selected applicants may receive 

grants or cooperative agreements of up 

to 50 percent of the total project cost not 

to exceed the Federal project cap. 

Applicants must provide non-Federal 

funding equal to the amount of Federal 

funds requested. Non-Federal funds 

must be derived from cash and/or inkind sources. 

(3) CIG is designed to provide 

financial assistance to grantees. 

Procurement of any technical assistance 

required to carry out a project is the 

responsibility of the grantee. Technical 

oversight for grant projects will be 

provided by a Federal technical 

representative who will be designated 

by NRCS. 

(d) CIG applications must describe the 

use of innovative approaches or 

technologies to address a natural 

resource conservation concern or 

concerns. The resource concerns for CIG 

will be identified by the Chief and may 

change each year. The resource 

concerns will be published in the APF. 

(e)(1) To be eligible, CIG applicants 

must be an Indian Tribe, State or local 

unit of government, nongovernmental 

organization, or individual. 

(2) To be eligible, projects must 

involve landowners who meet the 

eligibility requirements of § 1466.6(b)(1) 

through (3). All agricultural producers 

receiving a direct or indirect payment 

through participation in a CIG project 

must meet those eligibility 

requirements. 

(3) Up to 10 percent of the total funds 

available for CIG may be set aside for 

applications from historically 

underserved producers or veteran 

farmers or ranchers, or a communitybased organization comprised of or 

representing these entities. Funds not 

awarded from the set-aside pool will 

revert back into the general CIG funding 

pool. 

(f) The CIG APF will contain guidance 

on how to apply for the grants 

competition. CIG will be advertised 

through the NRCS Web site and 

grants.gov or other Federal grants portal. 

Grant applications will be available on 

the NRCS Web site or by contacting 

NRCS at the address provided in the 

APF. CIG grant applications will consist 

of standard cover sheet and budget 

forms, in addition to a narrative project 

description and required legal 

declarations and certifications. 

(g) Complete applications will be 

evaluated by a peer review panel based 

on the application evaluation criteria 

identified in the APF. Application 

evaluations will be forwarded to a Grant 

Review Board. The Grant Review Board 

will make recommendations for awards 

to the Chief, and the final selections will 

be made by the Chief. Grant or 

cooperative agreement awards will be 

made by the NRCS national office after 

selection of the grantees is made and 

after the grantee agrees to the terms and 

conditions of the NRCS Grant or 

cooperative agreement document. 

(h)(1) NRCS has the option of 

implementing a State-level CIG 

component. A State program will follow 

the requirements of this section, except 

for those features described in this 

subsection. 

(2) Funding availability, application, 

and submission information for State 

competitions will be announced 

through public notices (grants.gov or a 

successor Federal grants portal and on 

the State NRCS Web site), separately 

from the national program. The State 

component will emphasize projects that 

cover limited geographic areas 

including individual farms, multicounty areas, or small watersheds. 

(3) The State Conservationist will 

determine the funding level for the state 

CIG competition, with individual grants 

not to exceed $75,000. 

(4) NRCS may choose to adhere to the 

CIG national resource concerns for a 

state or may select a subset of those 

concerns that more closely match the 

resource concerns of the State. 

(i) Allocation of rights to patents and 

inventions shall be in accordance with 

7 CFR 3019.36. This regulation provides 

that small businesses normally may 

retain the principal worldwide patent 

rights to any invention developed with 

USDA support. In accordance with 7 

CFR 3019.2, this provision will also 

apply to commercial organizations for 

the purposes of CIG. USDA receives a 

royalty-free license for Federal 

Government use, reserves the right to 

require the patentee to license others in 

certain circumstances, and requires that 

anyone exclusively licensed to sell the 

invention in the United States must 

normally manufacture it domestically. 

Subpart C—General Administration 

§ 1466.30 Appeals. 

A participant may obtain 

administrative review of an adverse 

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73976 Federal Register / Vol. 79, No. 239 / Friday, December 12, 2014 / Rules and Regulations 

decision under EQIP in accordance with 

parts 11 and 614 of this title. 

Determination in matters of general 

applicability, such as payment rates, 

payment limits, the designation of 

identified priority resource concerns, 

and eligible conservation practices are 

not subject to appeal. 

§ 1466.31 Compliance with regulatory 

measures. 

Participants who carry out 

conservation practices will be 

responsible for obtaining the authorities, 

rights, easements, permits, or other 

approvals necessary for the 

implementation, operation, and 

maintenance of the conservation 

practices in keeping with applicable 

laws and regulations. Participants will 

be responsible for compliance with all 

laws and for all effects or actions 

resulting from the participant’s 

performance under the contract. 

§ 1466.32 Access to operating unit. 

Any authorized NRCS representative 

will have the right to enter an 

agricultural operation or tract for the 

purposes of determining eligibility and 

for ascertaining the accuracy of any 

representations related to contract 

performance. Access will include the 

right to provide technical assistance, 

determine eligibility, inspect any work 

undertaken under the contract, and 

collect information necessary to 

evaluate the conservation practice 

performance specified in the contract. 

The NRCS representative will make an 

effort to contact the participant prior to 

the exercising this provision. 

§ 1466.33 Equitable relief. 

(a) If a participant relied upon the 

advice or action of any authorized NRCS 

representative and did not know, or 

have reason to know, that the action or 

advice was improper or erroneous, 

NRCS may accept the advice or action 

as meeting program requirements and 

may grant relief, to the extent it is 

deemed desirable by NRCS, to provide 

a fair and equitable treatment because of 

the good-faith reliance on the part of the 

participant. The financial or technical 

liability for any action by a participant 

that was taken based on the advice of a 

NRCS certified non-USDA TSP is the 

responsibility of the certified TSP and 

will not be assumed by NRCS when 

NRCS authorizes payment. Where a 

participant believes that detrimental 

reliance on the advice or action of a 

NRCS representative resulted in an 

ineligibility or program violation, but 

the participant believes that a good faith 

effort to comply was made, the 

participant may request equitable relief 

under § 635.3 in chapter VI of this title. 

(b) If, during the term of an EQIP 

contract, a participant has been found in 

violation of a provision of the EQIP 

contract, the O&M agreement, or any 

document incorporated by reference 

through failure to fully comply with that 

provision, the participant may be 

eligible for equitable relief under § 635.4 

in chapter VI of this title. 

§ 1466.34 Offsets and assignments. 

(a) Except as provided in paragraph 

(b) of this section, any payment or 

portion thereof to any person, joint 

venture, legal entity, or Tribe will be 

made without regard to questions of title 

under State law and without regard to 

any claim or lien against the crop, or 

proceeds thereof, in favor of the owner 

or any other creditor except agencies of 

the United States Government. The 

regulations governing offsets and 

withholdings found at part 1403 of this 

chapter will be applicable to contract 

payments. 

(b) EQIP participants may assign any 

payments in accordance with part 1404 

of this chapter. 

§ 1466.35 Misrepresentation and scheme 

or device. 

(a) A person, joint operation, legal 

entity, or Indian Tribe that is 

determined to have erroneously 

represented any fact affecting a program 

determination made in accordance with 

this part will not be entitled to contract 

payments and must refund to NRCS all 

payments, plus interest, determined in 

accordance with 7 CFR part 1403. 

(b) A producer who is determined to 

have knowingly: 

(1) Adopted any scheme or device 

that tends to defeat the purpose of the 

program; 

(2) Made any fraudulent 

representation; 

(3) Adopted any scheme or device for 

the purpose of depriving any tenant or 

sharecropper of the payments to which 

such person would otherwise be 

entitled under the program; or 

(4) Misrepresented any fact affecting a 

program determination, will refund to 

NRCS all payments, plus interest, 

determined in accordance with 7 CFR 

part 1403, received by such producer 

with respect to all contracts. The 

producer’s interest in all contracts will 

be terminated. 

§ 1466.36 Environmental credits for 

conservation improvements. 

(a) A participant in EQIP may achieve 

environmental benefits that may qualify 

for environmental credits under an 

environmental credit-trading program. 

NRCS asserts no direct or indirect 

interest on these credits. However, 

NRCS retains the authority to ensure 

that EQIP purposes are met. In addition, 

any requirements or standards of an 

environmental market program in which 

an EQIP participant simultaneously 

enrolls to receive environmental credits 

must be compatible with the purposes 

and requirements of the EQIP contract 

and with this part. 

(b) The participant must meet all 

O&M requirements for EQIP-funded 

activities, consistent with § 1466.21 and 

§ 1466.22. Where activities required 

under an environmental credit 

agreement may affect the land and 

conservation practices under an EQIP 

contract, NRCS recommends that EQIP 

participants request assistance with the 

development of a compatibility 

assessment prior to entering into any 

credit agreement. The EQIP contract 

may be modified in accordance with 

policies outlined in § 1466.25, provided 

the modification meet EQIP purposes 

and is in compliance with this part. 

(c) EQIP participants may not use 

EQIP funds to implement conservation 

practices and activities that the 

participant is required to establish as a 

result of a court order. EQIP funds may 

not be used to satisfy any mitigation 

requirement for which the EQIP 

participant is responsible. 

Signed this 4th day of December 2014, in 

Washington, DC. 

Jason A. Weller, 

Vice President, Commodity Credit 

Corporation and Chief, Natural Resources 

Conservation Service. 

[FR Doc. 2014–28941 Filed 12–11–14; 8:45 am] 

BILLING CODE 3410–16–P 

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