199 
‘‘(i) ELIGIBILITY OF MARKET AGENCIES AND CUSTOM 
FEEDING BUSINESSES FOR ASSISTANCE.—A market agency 
(as defined in section 301(c) of the Packers and Stockyards 
Act, 1921 (7 U.S.C. 201(c))) or custom feeding business 
may receive technical assistance, cost-share payments, or 
incentive payments under the program. Any reference to 
‘producer’ in this chapter shall be deemed to include a mar-
ket agency or custom feeding business.’’. 
(i) EVALUATION OF APPLICATIONS FOR COST-SHARE 
PAYMENTS AND INCENTIVE PAYMENTS.—Section 1240C of 
the Food Security Act of 1985 (16 U.S.C. 3839aa–3) is 
amended to read as follows: 
‘‘SEC. 1240C. EVALUATION OF APPLICATIONS FOR COST- 
SHARE 
PAYMENTS 
AND 
INCENTIVE 
PAY-
MENTS. 
‘‘(a) PRIORITIES AND GROUPING OF APPLICATIONS.— 
In evaluating applications for cost-share payments and in-
centive payments, the Secretary shall— 
‘‘(1) prioritize applications based on their over-
all level of cost-effectiveness to ensure that the con-
servation practices and approaches proposed are the 
most efficient means of achieving the anticipated en-
vironmental benefits of the project; 
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‘‘(2) prioritize applications based on how effec-
tively and comprehensively the project addresses the 
designated resource concern or resource concerns; 
‘‘(3) prioritize applications that best fulfill the 
purpose of the environmental quality incentives pro-
gram specified in section 1240(1); 
‘‘(4) develop criteria for evaluating applications 
that will ensure that national, State, and local con-
servation priorities are effectively addressed; and 
‘‘(5) to the greatest extent practicable, group ap-
plications of similar crop or livestock operations for 
evaluation purposes or otherwise evaluate applica-
tions relative to other applications for similar farm-
ing operations. 
‘‘(b) EVALUATION PROCESS.—The Secretary shall en-
sure that the evaluation process is as streamlined and effi-
cient as practicable in the case of applications that— 
‘‘(1) involve operations with substantial and 
sound environmental management systems; and 
‘‘(2) seek a single practice or a limited number 
of practices to further improve the environmental per-
formance of that system.’’. 
(j) DUTIES OF PRODUCERS.—Section 1240D(2) of the 
Food Security Act of 1985 (16 U.S.C. 3839aa–4(2)) is 
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amended by striking ‘‘or ranch’’ and inserting ‘‘, ranch, 
or forestland’’. 
(k) PROGRAM PLAN.—Section 1240E of the Food Secu-
rity Act of 1985 (16 U.S.C. 3839aa–5) is amended by strik-
ing subsections (a) and (b) and inserting the following new 
subsections: 
‘‘(a) PLAN OF OPERATIONS.—To be eligible to receive 
cost-share payments or incentive payments under the pro-
gram, a producer shall submit to the Secretary for approval 
a plan of operations that— 
‘‘(1) specifies practices covered under the pro-
gram; 
‘‘(2) includes such terms and conditions as the 
Secretary considers necessary to carry out the pro-
gram, including a description of the purposes to be 
met by the implementation of the plan; 
‘‘(3) in the case of a confined livestock feeding 
operation, provides for development and implementa-
tion of a comprehensive nutrient management plan, if 
applicable; and 
‘‘(4) in the case of forestland, is consistent with 
the provisions of a forest management plan meeting 
with the approval of the Secretary, which may in-
clude a forest stewardship plan, as specified in section 
5 of the Cooperative Forestry Assistance Act of 1978 
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(16 U.S.C. 2103a), other practice plan approved by 
the State forester, or other plan determined appro-
priate by the Secretary. 
‘‘(b) AVOIDANCE
OF DUPLICATION.—The Secretary 
shall— 
‘‘(1) consider a permit acquired under a water 
or air quality regulatory program as the equivalent 
of a plan of operations under subsection (a); and 
‘‘(2) to the maximum extent practicable, elimi-
nate duplication of planning activities under the pro-
gram under this chapter and comparable conservation 
programs.’’. 
(l) DUTIES OF THE SECRETARY.—Section 1240F of 
the Food Security Act of 1985 (16 U.S.C. 3839aa–6) is 
amended— 
(1) by striking ‘‘To the extent’’ and inserting 
‘‘(a) PROVISION
OF ASSISTANCE.—To the extent’’; 
and 
(2) by adding at the end the following new sub-
section: 
‘‘(b) WATER SAVINGS.—In the case of a practice pri-
marily intended to conserve water, the Secretary may pro-
vide assistance to a producer under this section only if the 
Secretary determines that— 
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‘‘(1) the practice results in a minimum reduc-
tion, as determined by the Secretary, in the total con-
sumptive use of ground water or surface water re-
sources affected by the practice; 
‘‘(2) any saved water remains in the source for 
the useful life of the practice; and 
‘‘(3) the practice will not result, directly or indi-
rectly, in an increase in the consumptive use of water 
in the agriculture operation of the producer.’’. 
(m) CONSERVATION INNOVATION GRANTS.—Section 
1240H of the Food Security Act of 1985 (16 U.S.C. 
3839aa–8) is amended to read as follows: 
‘‘SEC. 1240H. CONSERVATION INNOVATION GRANTS. 
‘‘(a) COMPETITIVE GRANTS.—The Secretary shall pay 
the cost of competitive grants that are intended to stimulate 
innovative approaches to leveraging Federal investment in 
environmental enhancement and protection, in conjunction 
with agricultural production or forest resource manage-
ment, through the program. 
‘‘(b) USE.—The Secretary may provide grants under 
this section to governmental and non-governmental organi-
zations and persons, on a competitive basis, to carry out 
projects that— 
‘‘(1) involve producers that are eligible for pay-
ments or technical assistance under the program; 
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‘‘(2) leverage funds made available to carry out 
the program under this chapter with matching funds 
provided by State and local governments and private 
organizations to promote environmental enhancement 
and protection in conjunction with agricultural pro-
duction; 
‘‘(3) ensure efficient and effective transfer of in-
novative technologies and approaches demonstrated 
through projects that receive funding under this sec-
tion; and 
‘‘(4) provide environmental and resource con-
servation benefits through increased participation by 
producers of specialty crops. 
‘‘(c) PILOT PROGRAM
FOR COMPREHENSIVE CON-
SERVATION PLANNING.— 
‘‘(1) PILOT PROGRAM REQUIRED.—The Secretary 
shall establish a pilot program to undertake com-
prehensive conservation planning to assist producers 
before they submit an application for assistance 
under any of the conservation programs authorized by 
this subtitle. 
‘‘(2) CONSERVATION
PLANNING
ASSISTANCE.— 
The Secretary shall undertake pilot projects under the 
pilot program in the locations specified in paragraph 
(3) to assist producers by making a comprehensive as-
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sessment of the resource concerns, needs, and alter-
native solutions for the producer’s entire operation, as 
determined by the Secretary, following the procedures 
in the Natural Resources Conservation Service con-
servation planning manual. The assistance shall be 
provided by the Secretary directly or through third 
party providers certified by the Secretary, and shall 
not be at the expense of the producer. The results of 
the comprehensive planning assistance shall be pro-
vided to the producer to enable informed choices on 
the type of financial assistance available under this 
subtitle that would most effectively address the re-
source needs of the operation consistent with the envi-
ronmental goals for the area in which the operation 
is located. 
‘‘(3) PILOT PROJECTS.—Pilot projects in com-
prehensive conservation planning shall be undertaken 
in the Chesapeake Bay watershed, and shall include 
the identification of hydrologic, soil, and rural land 
use factors that are unique to the Delmarva Penin-
sula. 
‘‘(4) REPORT.—The Secretary shall conduct an 
assessment of the effectiveness of the pilot program 
and publish a report, available to the public, of the 
results of the assessment. Such assessments shall be 
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undertaken in the second year and the fifth year of 
the pilot program. 
‘‘(d) FUNDING.— 
‘‘(1) AVAILABILITY
OF
FUNDS.—Of the funds 
made available under section 1241(a)(6) for fiscal 
years 2008 through 2012, the Secretary shall use 
$30,000,000 for fiscal year 2008, $35,000,000 for fis-
cal year 2009, $50,000,000 for fiscal year 2010, 
$60,000,000 for fiscal year 2011, and $75,000,000 for 
fiscal year 2012. 
‘‘(2) OUTREACH FOR CERTAIN PRODUCERS.—Of 
the funds made available under paragraph (1) for a 
fiscal year, the Secretary shall use $5,000,000 to make 
grants to support effective outreach and innovative 
approaches for outreach and to serve organic pro-
ducers and producers of specialty crops (as defined in 
section 3 of the Specialty Crops Competitiveness Act 
of 2004 (Public Law 108–465; 7 U.S.C. 1621 note). 
‘‘(3) 
COMPREHENSIVE
CONSERVATION
PLAN-
NING.—Of the funds made available under paragraph 
(1) for a fiscal year, the Secretary shall use 
$5,000,000 to carry out the comprehensive conserva-
tion planning pilot program under subsection (c). 
‘‘(4) AIR QUALITY.—Of the funds made available 
under paragraph (1), the Secretary shall use 
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$10,000,000 for fiscal year 2008, $15,000,000 for fis-
cal year 2009, $30,000,000 for fiscal year 2010, 
$40,000,000 for fiscal year 2011, and $55,000,000 for 
fiscal year 2012 to support air quality improvement 
and performance incentives for States to help meet 
State and local regulatory requirements related to air 
quality.’’. 
SEC. 2106. REGIONAL WATER ENHANCEMENT PROGRAM. 
(a) PURPOSE AND GOALS.—The purpose of this section 
is to authorize a regional water enhancement program, 
within the environmental quality incentives program, to 
enhance performance-based, cost-effective conservation car-
ried out through cooperative agreements entered into by the 
Secretary of Agriculture with producers, governmental enti-
ties, and Indian tribes. The goal of the program is to im-
prove water quality or ground and surface water quantity 
through coordinated program activities on agricultural 
lands. The Secretary will develop goals and provide coordi-
nated program assistance for water quality or water quan-
tity improvement projects. 
(b) ESTABLISHMENT OF PROGRAM.—Section 1240I of 
the Food Security Act of 1985 (16 U.S.C. 3839aa–9) is 
amended to read as follows: 
‘‘SEC. 1240I. REGIONAL WATER ENHANCEMENT PROGRAM. 
‘‘(a) DEFINITIONS.—In this section: 
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‘‘(1) REGIONAL
WATER
ENHANCEMENT
ACTIVI-
TIES.—The term ‘regional water enhancement activi-
ties’ includes resource condition assessment and mod-
eling, water quality, water quantity or water con-
servation plan development, management system and 
environmental monitoring and evaluation, cost-share 
of restoration or enhancement projects, incentive pay-
ments for land management practices, easement pur-
chases, conservation contracts with landowners, im-
proved irrigation systems, water banking and other 
forms of water transactions, groundwater recharge 
and other conservation related activities that the Sec-
retary determines will help to achieve the water qual-
ity or water quantity benefits on agricultural lands 
identified in a partnership agreement. 
‘‘(2) 
PARTNERSHIP
AGREEMENT.—The 
term 
‘partnership agreement’ means an agreement between 
the Secretary and a partner under subsection (d). 
‘‘(3) PARTNER.—The term ‘partner’ means an 
entity that enters into a partnership agreement with 
the Secretary to carry out regional water enhance-
ment activities. The term includes— 
‘‘(A) an agricultural producer, agricultural 
or silvicultural producer association, or other 
group of such producers; 
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