Fiscal Year (FY) 2002 Landowner Incentive Program (Non Tribal Portion) for States, Territories and the District of Columbia; Final Policy With Implementation Guidelines, and Request for Proposals

DEPARTMENT OF THE INTERIOR

Fish and Wildlife Service

RIN 1018-AI55

Fiscal Year (FY) 2002 Landowner Incentive Program (Non Tribal

Portion) for States, Territories and the District of Columbia; Final

Policy With Implementation Guidelines, and Request for Proposals

AGENCY: Fish and Wildlife Service, Interior.

ACTION: Final policy with implementation guidelines; notice of request

for proposals.

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SUMMARY: The Department of the Interior and Related Agencies

Appropriations Act 2002 allocated $40 million from the Land and Water

Conservation Fund for conservation grants to States, the District of

Columbia, Puerto Rico, Guam, the United States Virgin Islands, the

Northern Mariana Islands, and American Samoa (hereafter referred to

collectively as States), and Tribes under a Landowner Incentive Program

(LIP).

[[Page 61641]]

This notice provides the final guidelines for how the U.S. Fish and

Wildlife Service (Service) will implement LIP with the States and

serves as the Request for Proposals for the FY 2002 LIP funds. The

Service will address the Tribal component of LIP under a separate

Federal Register notice.

DATES: This Policy and these Implementation Guidelines are effective

October 1, 2002. We must receive your grant proposal no later than

December 2, 2002. We will not accept facsimile grant proposals.

ADDRESSES: Submit grant proposals to the Division of Federal Aid, 4401

North Fairfax Drive, Suite 140, Arlington, VA 22203-1610. The

administrative record for this notice, including copies of comments

received, is available for viewing at this location Monday through

Friday, 8 a.m. to 4 p.m.

FOR FURTHER INFORMATION CONTACT: Tim Hess, Biologist, U.S. Fish and

Wildlife Service, Division of Federal Aid, 4401 North Fairfax Drive,

Suite 140, Arlington, VA 22203-1610; telephone (703) 358-2156; fax

(703) 358-1837; e-mail [email protected], or the Regional Office

contact persons identified in the answer to Question 25 in the

Implementation Guidelines.

SUPPLEMENTARY INFORMATION:

Background

In recent years, natural resource managers have increasingly

recognized that private lands play a pivotal role in linking or

providing important habitats for fish, wildlife, and plant species. To

protect and enhance these habitats through incentives for private

landowners, the President's Budget for Fiscal Year 2002 requested

funding to address this need and Congress responded by appropriating

$40 million from the Land and Water Conservation Fund for the Service

to establish and administer a new Landowner Incentive Program (LIP).

The Service will award grants to States for programs that enhance,

protect, or restore habitats that benefit federally listed, proposed,

or candidate species, or other at-risk species on private lands. A

primary objective of LIP is to establish, or supplement existing, State

landowner incentive programs that provide technical and financial

assistance, including habitat protection and restoration, to private

landowners for the protection and management of habitat to benefit

federally listed, proposed, or candidate species, or other at-risk

species on private lands as stated in the appropriations language. LIP

complements other Federal private lands conservation programs that

focus on the conservation of habitat.

Introduction

The Federal (Service) role in implementation of LIP is to provide

policy, guidance, funds, and oversight to States who seek to develop

and implement a qualifying landowner incentive program. The State role

in implementation of LIP is to provide technical and financial

assistance to private landowners for projects for the protection and

management of habitat for species-at-risk. The private landowners' role

is to provide the habitat necessary to accomplish the objectives of LIP

and assist in project implementation.

The Service is soliciting grant proposals for Federal funding under

LIP through the publishing of this policy and guidelines. The remainder

of this document is divided into three sections: (1) our Final LIP

Implementation Guidelines that contain direction on grant proposal

submission; (2) the comments received concerning the Proposed LIP

Policy and Implementation Guidelines published in the Federal Register

on June 7, 2002 (67 FR 39414), and our responses; and (3) a description

of the regulatory requirements associated with issuing the Final LIP

Policy with Implementation Guidelines.

LIP Final Implementation Guidelines

Definitions of Terms Used in These Guidelines

``Species-at-risk'' is defined as any Federally listed, proposed,

or candidate animal or plant species or other species of concern as

determined and documented by a State. Species classified by the State

as a ``species-at-risk'' must be identified as such in its grant

proposal.

``Private land'' is considered any nongovernment-owned land.

A ``project'' is a discrete task to be undertaken by or with

private landowners for the accomplishment of the defined LIP

objectives.

Program Requirements

1. What is the objective of this program? The primary objective of

this program is to establish or supplement State landowner incentive

programs that protect and restore habitats on private lands, to benefit

Federally listed, proposed, or candidate species or other species

determined to be at-risk, and provide technical and financial

assistance to private landowners for habitat protection and

restoration.

2. How will the Tribes participate in LIP? The Service is

allocating $4 million of the total funds appropriated under LIP to

Tribes for a competitive grant program that we will describe in a

separate Federal Register notice. For Tribal LIP grant information

contact Pat Durham, U.S. Fish and Wildlife Service, Office of Native

American Liaison, 1849 C Street NW., Mail Stop 3251, Washington, DC

20240 or call (202) 208-4133.

3. Does LIP require plans to be developed like the State Wildlife

Grant Program (FY 2002) and the Wildlife Conservation and Restoration

Program? No.

4. Who can apply for an LIP grant? The State agency with primary

responsibility for fish and wildlife will be responsible for submitting

all proposals to the U.S. Fish and Wildlife Service, Division of

Federal Aid (FA). All other governmental entities, individuals, and

organizations, including Tribes, may partner with or serve as a

subgrantee to that fish and wildlife agency.

Fiscal Issues

5. How will the Service distribute the available $40 million? The

Service will allocate $34.8 million for competitive grants to States,

$4.0 million for Tribes, and $1.2 million for program administration by

the Service.

6. What is the non-Federal match requirement for LIP grants? The

Service requires a minimum of 25% non-Federal match for LIP grants

(i.e. at least 25 percent of the total costs must come from sources

other than LIP or other federal funds). The U.S. Virgin Islands, Guam,

American Samoa, and the Northern Mariana Islands are exempt from

matching requirements for this program (based on 48 U.S.C. 1469a. (d)).

7. May the required non-Federal match be in-kind contributions?

Yes. Allowable in-kind contributions are defined in Title 43 of the

Code of Federal Regulations (43 CFR) part 12.64. The following Web site

provides additional information http://www.nctc.fws.gov/fedaid/toolkit/

4312c.pdf.

Grant Administration

8. How will the Service award grants to States? The Service will

use a two-tiered award system. We will assess Tier-1 grant proposals to

see that they meet minimum eligibility requirements. The Service will

rank Tier-2 grants based on criteria described in this notice and award

grants after a national competition.

9. What are the intended objectives of Tier-1 grants? The Service

intends that Tier-1 grants fund staff and associated support necessary

to develop or

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enhance an existing landowner program. Through the development of

plans, outreach, and associated activities that assist in the

accomplishment of projects on private lands, these programs should

benefit private landowners and other partners to help manage and

protect habitats that benefit species-at-risk.

10. What are the eligibility requirements for Tier-1 grants? To

receive a Tier-1 grant a State program must demonstrate in its proposal

that it can meet all of the following:

(a) Deliver technical and financial assistance to landowners;

(b) Provide for appropriate administrative functions such as fiscal

and contractual accountability;

(c) Use LIP grants to supplement and not replace existing funds;

(d) Distribute funds to landowners through a fair and equitable

system;

(e) Provide outreach and coordination that assist in administering

the program; and

(f) Describe a process for the identification of species-at-risk,

and a process for the identification of clear, obtainable and

quantified goals and performance measures that will help achieve the

management goals and objectives of LIP. Through this program, the

States' efforts and leadership will help the Service meet its Long-Term

and Annual Performance Goals.\1\

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\1\ The two relevant Service goals are the Sustainability of

Fish and Wildlife Populations (Goal 1.2) and Habitat Conservation

(Goal 2.3), which can be found in the Service's Long Term Strategic

Plan for 2000 to 2005 at http://planning.fws.gov/

usfwstrategicplanv3.pdf. Related Service planning and results

reports can be found at http://planning.fws.gov.

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11. What are the intended objectives of Tier-2 grants? The

objective of a Tier-2 grant should place a priority on the

implementation of State programs that provide technical and financial

assistance to the private landowner. Programs should emphasize the

protection and restoration of habitats that benefit Federally listed,

proposed, or candidate species, or other species-at-risk on private

lands. The Service generally intends a Tier-2 grant to fund the

expansion of existing State landowner incentive programs or those

created under Tier-1 grants.

12. What criteria will the Service use to rank Tier-2 grants? The

Service proposes to use the following criteria to rank Tier-2

proposals:

(a) Proposal provides clear and sufficient detail to describe the

program. States are encouraged to describe any projects that are part

of a broader scale conservation planning effort at the State or

regional level. (0-10 points)

(b) Proposal describes adequate management systems for fiscal,

contractual and performance accountability (State), including annual

monitoring and evaluation of progress toward desired program objectives

and performance measures and goals identified in the ``expected results

or benefits'' section of the grant application (landowner and State).

(0-10 points)

(c) Proposal describes the State's fair and equitable system for

fund distribution. For example, States develop their own process to

evaluate and prioritize their project proposals based on criteria such

as species needs, priority habitats, compliance with State and Federal

requirements, and feasibility of success and select projects for grant

proposal funding based on their highest priority standing. (0-10

points)

(d) Proposal describes outreach efforts used to effect broad public

awareness, support, and participation. (0-10 points)

(e) Proposal identifies by name the species-at-risk to benefit from

the proposal. Points increase from zero to 10 as the State identifies

more species.

(f) Proposal describes the percentage of the State's total LIP

Tier-2 program funds identified for use on private land projects as

opposed to staff and related administrative support costs. Points

increase from zero to five as the percentage of funds identified for

staff and related administrative costs decreases in comparison to the

total program costs.

(g) Proposal identifies the percentage of total nonfederal fund

cost sharing. Points increase from zero to five as the percentage of

nonfederal cost sharing on the grant increases above the minimum cost

share.

(h) Proposal demonstrates the urgency of the projects or actions

that are to benefit the species targeted, and the short-term and long-

term benefits anticipated to be gained. (0-5 points)

13. Are there funding limits (caps) for LIP? Yes.

(a) The Service will cap Tier-1 grants at $180,000 for State fish

and wildlife agencies, and $75,000 for Territories and the District of

Columbia.

(b) In addition, no State may receive more than $1.74 million Tier-

1 and Tier-2 funds combined from the FY 2002 appropriation.

14. May a State submit more than one proposal? States may submit

one proposal each for Tier-1 and Tier-2 grants under this notice.

However, funding limits still apply, as described in the answer to

Question 13.

15. If some FY 2002 funds remain after awarding Tier-1 and Tier-2

grants, how will the Service make them available to the States? We will

announce subsequent requests for proposals until all LIP funds are

obligated. States that have not reached the cap may submit an

additional proposal during future requests for proposals.

16. Will interest accrue to the account holding LIP funds and if so

how will it be used? No. LIP funds were not approved for investing, and

as a result no interest will accrue to the account.

17. What administrative requirements must States comply with in

regard to LIP? States must comply with 43 CFR part 12 that provides the

administrative regulations (http://www.nctc.fws.gov/fedaid/toolkit/

4312c.pdf) and OMB Circular A-87 that provides cost principles (http://

www.whitehouse.gov/omb/circulars).

18. What information must a State include in a grant proposal? An

LIP grant proposal must include an Application for Federal Assistance

(SF-424) and must identify whether it is a Tier-1 or Tier-2 proposal.

The proposal must also include statements describing the need,

objectives, expected results or benefits, approach or procedures,

location, and estimated cost for the proposed work (OMB Circular A-

102). The expected results or benefits section must identify the

State's discrete, obtainable and quantified performance measures to be

accomplished (for example, the anticipated number of acres of wetlands

or stream miles to be restored, or the number of at-risk species with

improved status) that will address the goals of LIP and, at the same

time, the Service's Long-Term Goals of Sustainability of Fish and

Wildlife Population \2\ (Goal 1.2) and Habitat Conservation \3\ (Goal

2.3).

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\2\ By the end of 2005, 404 species listed under the Endangered

Species Act as threatened or endangered for a decade or more will be

stable or improving, 15 species will be delisted due to recovery,

and a listing of 12 species at risk is made unnecessary due to

conservation.

\3\ By 2005, trust fish and wildlife populations, threatened and

endangered species, and species of special concern will be improved

by enhancing and/or restoring or creating 550,000 acres of wetlands

habitat, restoring 1,000,000 acres of upland habitats, and enhancing

and/or restoring 9,800 riparian or stream miles of habitat off

Service land through partnerships and other conservation strategies.

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The grant proposal should also clearly identify how each of the

minimum eligibility requirements (Tier-1) and ranking criteria (Tier-2)

are addressed. The SF-424 is available from FA at any Service Regional

Office or at http://www.nctc.fws.gov/fedaid/toolkit/formsfil.pdf.

19. Where should a State send grant proposals? States should submit

all LIP

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proposals to the U.S. Fish and Wildlife Service, Division of Federal

Aid, 4401 North Fairfax Drive, Suite 140, Arlington, VA 22203-1610.

20. When are proposals due to the Service? The Service will accept

proposals between October 1, 2002 and December 2, 2002.

21. What process will the Service use to evaluate and select

proposals for funding? The Service will evaluate all proposals that are

received by the end of the period set forth in the answer to Question

20, above. Successful proposals will then be selected based on the

final eligibility and selection criteria in the Implementation

Guidelines, and will be subject to the final approval of the Assistant

Secretary for Fish and Wildlife and Parks. The Service will notify all

applicants of the results as soon as practicable but within 60 days of

the deadline for submission of proposals.

22. Once a proposal is selected for funding, what additional grant

documents must the applicant submit and to whom? In addition to the

Application for Federal Assistance submitted with the original

proposal, the Service requires the following documents: a Grant

Agreement (Form 3-1552) and a schedule of work the State proposes to

fund through this grant. Additionally, the Service, in cooperation with

the applicants, must address Federal compliance issues, such as the

National Environmental Policy Act, the National Historic Preservation

Act, and the Endangered Species Act. Regional Office FA staff can

assist in explaining the procedures and documentation necessary for

meeting these Federal requirements. The States must send this

additional documentation to the appropriate Regional Office where FA

staff will approve the grant agreement to obligate funds. See the

answer to Question 25 for Regional Office locations and http://

www.nctc.fws.gov/fedaid/toolkit/fagabins.pdf for additional

information.

23. What reporting requirements must States meet once funds are

obligated under an LIP grant agreement? The Service requires an annual

progress report and Financial Status Report (FSR) for grants longer

than one year. In addition, a final performance report and FSR (SF-269)

are due to the Regional Office within 90 days of the grant agreement

ending date.

In its annual report, the State must include a list of project

accomplishments in relation to those which were planned in the grant

agreement. The number of upland and wetland acres and the number of

riparian/stream miles restored or improved (performance measures), and

the species benefitted should be provided. This information will help

demonstrate the States' efforts and leadership in helping the LIP meet

the Service's national goals for Fish and Wildlife Sustainability (1.2)

and Habitat Conservation (2.3). The effectiveness of each State's

program, as reported in its annual progress reports, will be an

important factor considered during the grant award selection process in

subsequent years.

24. Will landowners who have LIP projects implemented on their

property be required to leave project improvements in place for a

specific period? States should address this issue in their grant

proposals, landowner incentive programs, and agreements with individual

landowners. Habitat improvements should remain in place to realize the

desired benefits for species-at-risk.

25. Whom can I contact in the Service about the LIP program in my

local or regional area? Correspondence and telephone contacts for the

Service are listed by Region below.

Region 1. Hawaii, Idaho, Oregon, Washington, California, Nevada,

American Samoa, Guam, and Commonwealth of the Northern Mariana Islands.

Regional Director, Division of Federal Aid, U.S. Fish and Wildlife

Service, 911 NE 11th Avenue, Portland, Oregon 97232-4181, LIP Contact:

Jim Greer, (503) 231-6128

Region 2. Arizona, New Mexico, Oklahoma, and Texas.

Regional Director, Division of Federal Aid, U.S. Fish and Wildlife

Service, 500 Gold Avenue SW, Room 4012, Albuquerque, New Mexico 87102,

LIP Contact: Bob Anderson, (505) 248-7459

Region 3. Illinois, Indiana, Iowa, Michigan, Minnesota, Missouri,

Ohio, and Wisconsin.

Regional Director, Division of Federal Aid, U.S. Fish and Wildlife

Service, Bishop Henry Whipple Federal Building, One Federal Drive, Fort

Snelling, Minnesota 55111-4056, LIP Contact: Lucinda Corcoran, (612)

713-5135

Region 4. Alabama, Arkansas, Florida, Georgia, Kentucky, Louisiana,

Mississippi, North Carolina, South Carolina, Tennessee, Puerto Rico,

and the U.S. Virgin Islands.

Regional Director, Division of Federal Aid, U.S. Fish and Wildlife

Service, 1875 Century Boulevard, Suite 200, Atlanta, Georgia 30345, LIP

Contact: Marilyn Lawal, (404) 679-7277

Region 5. Connecticut, Delaware, District of Columbia, Maine,

Maryland, Massachusetts, New Hampshire, New Jersey, New York,

Pennsylvania, Rhode Island, Vermont, Virginia, and West Virginia.

Regional Director, Division of Federal Aid, U.S. Fish and Wildlife

Service, 300 Westgate Center Drive, Hadley, MA 01035-9589, LIP Contact:

Vaughn Douglas, (413) 253-8502

Region 6. Colorado, Kansas, Montana, Nebraska, North Dakota, South

Dakota, Utah, and Wyoming.

Regional Director, Division of Federal Aid, U.S. Fish and Wildlife

Service, P.O. Box 25486, Denver Federal Center, Denver, Colorado 80225-

0486, LIP Contact: Jacque Richy, (303) 236-8155 ext. 236

Region 7. Alaska.

Regional Director, Division of Federal Aid, U.S. Fish and Wildlife

Service, 1011 East Tudor Road, Anchorage, Alaska 99503-6199, LIP

Contact: Al Havens (907) 786-3435

Analysis of Public Comment and Changes Made to the Proposed LIP

Implementation Guidelines

On June 7, 2002, the Service published a notice in the Federal

Register (67 FR 39414) and requested comments on the proposed

implementation guidelines for the FY 2002 Landowner Incentive Program

(Non Tribal Portion) for States, Territories, and the District of

Columbia. The Service received 25 written responses by the close of the

comment period on July 8, 2002. The responses came from the following:

Arizona Game and Fish Department; Delaware Department of Natural

Resources and Environmental Control; Ducks Unlimited; Georgia

Department of Natural Resources; Hawaii Department of Land and Natural

Resources; International Association of Fish and Wildlife Agencies;

Louisiana Forestry Association; Michigan Department of Natural

Resources; Montana Fish, Wildlife and Parks; National Association of

Conservation Districts; Nebraska Game and Parks Commission; Ocean

Nature and Conservation Society; Ohio Department of Natural Resources;

Oregon Department of Fish and Wildlife; Red Lake Band of Chippewa

Indians; Texas Farm Bureau; Texas Parks and Wildlife Department; The

Nature Conservancy; Turner Endangered Species Fund; U.S. National Park

Service; Vermont Agency of Natural Resources; Walla Walla County

Conservation District; Wapiti Ridge Coordinated Resource Management;

Wildlife Management Institute; and

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Wisconsin Department of Natural Resources.

We received a total of 50 substantive comments from the 25 written

responses covering a wide range of topics. Of these, 26 comments dealt

with the ranking criteria and scoring process. Six organizations or

agencies wrote letters that indicated their overall support for LIP

with no additional comments that required a response. The following is

a list of substantive comments received and our responses to those

comments.

Comments Not Directly Related to the Scoring Process and Ranking

Criteria

Comment 1. We recommend that the final guidelines for LIP clearly

indicate that projects that advance imperiled species recovery through

means other than habitat management are considered appropriate for LIP.

Response: The Interior Appropriations bill language states that the

grants are to be used to provide technical and financial assistance to

private landowners for the protection and management of habitat to

benefit federally listed, proposed, or candidate species, or other at-

risk species on private lands. The projects therefore must have a clear

relationship to habitat, and this relationship must be spelled out in a

State's grant proposal.

Comment 2. ``Species-at-risk'' needs to be better defined.

Response: We believe the intent of Congress was to address species

such as those found on Federal and State protected species lists, while

at the same time allowing the States to determine if additional species

should also be considered at-risk (that have similar biological

concerns as those already listed) and covered by their LIP program.

States should include their current LIP list of species-at-risk in

their grant proposal.

Comment 3. We encourage the Service to take a flexible, progressive

perspective in working with the States to define ``at-risk'' species.

Response: Each State wildlife agency has full authority in

determining its species-at-risk, and in justifying their focus on those

species identified in the grant proposal. (Also see response to Comment

2).

Comment 4. It should be made clearer in the guidelines that LIP

programs can also be applied to riparian and shoreline private lands

that provide habitat for aquatic species-at-risk found in adjoining

public waters.

Response: Riparian and shoreline protection and restoration

activities, and also fish migration barrier removal activities, on

private lands qualify if the habitat benefits for the species-at-risk

are clearly identified no matter the ownership where the species

reside.

Comment 5. Private land initiatives should promote a holistic view

of the habitat needs of species * * * we feel that practices and

actions taken on private lands should consider an array of species.

Response: The program's objective is to benefit species-at-risk, so

the grant proposal must identify those species. One criterion used to

rank proposals ((e) in the answer to Question 12) involves the number

(array) of species-at-risk benefitted, with a greater number of species

benefitted leading to a higher score.

Comment 6. The Service should encourage and make it possible for

the States to approach assistance to landowners with administrative

flexibility.

Response: The Service is requiring compliance with only those

administrative rules mandated for this program by existing Federal

Regulations in 43 CFR part 12. State agencies will determine

administrative procedures involving private landowners and other

partners.

Comment 7. We encourage the Service to give preference to

applications for projects that are part of a broad-scale conservation

planning effort.

Response: We have added to our description of the first proposed

ranking criterion ((a) in the answer to Question 12) to address this

point.

Comment 8. It would make sense to allow the ``lead entities''

designated by the Salmon Recovery Fund Board [in Washington] to submit

grant proposals directly to the Service and compete for this funding.

Response: Congress stipulated that LIP grants were available for

States and Territories only. The Service will utilize the State fish

and wildlife agencies as the eligible grantees due to their primary

responsibility for wildlife conservation among State agencies. All

other agencies, organizations, and individuals working with private

landowners on species-at-risk habitat issues are encouraged to

establish partnerships with the State fish and wildlife agencies.

Comment 9. In cases where a State wildlife agency does not apply

for funding under this initiative, we believe that other State agencies

involved in wildlife management should be permitted to apply.

Response: At this time, we are not aware of any State fish and

wildlife agencies that are not considering the submission of an LIP

grant proposal. If notified, the Service would consider another State

agency designated by the Governor.

Comment 10. Are nongovernmental (nonprofit) individuals and

organizations allowed to partner with or serve as a subgrantee to the

fish and wildlife agency?

Response: Yes, both governmental and nongovernmental organizations

and individuals may partner with or serve as a subgrantee of a State

fish and wildlife agency.

Comment 11. We suggest that LIP implementation guidelines use the

same regional allocation formula as has been proposed in the Service's

Private Stewardship Grant Program.

Response: The Congressional language for LIP requires the program

to be competitive, which we interpret to be competitive at the national

level. We believe the disbursement of FY 2002 LIP funds can be done

efficiently and achieve a broad geographic distribution through a

national review and selection process rather than a regional allocation

process.

Comment 12. A requirement for State agencies to provide in excess

of a 25 percent match for grants may prove so costly as to discourage

participation.

Response: LIP grants require only a 25% nonfederal match (see the

answer to Question 6 in the Implementation Guidelines). Increased

nonfederal matching shares beyond 25% are scored more favorably under

one of the ranking criteria (see (g) in the answer to Question 12), but

a match greater than 25% is not required.

Comment 13. Accounting requirements and processes for in-kind and

matching contributions that are too cumbersome and costly may cause

motivated State agencies to decline to participate in this initiative.

Response: Matching contribution (including in-kind) administrative

and audit requirements are provided in Title 43 of the Code of Federal

Regulations, Part 12 for all Department of the Interior assistance

programs, including LIP. Based on our experience working with the

States in other Federal Aid grant programs, we believe the partnership

and accountability benefits outweigh the administrative burdens

associated with the use of in-kind match.

Comment 14. We recommend that you establish a Tier 3 program * * *

that would address a multi-state concern with respect to at-risk

species * * * and we recommend a fund match of 90%/10% (Federal/State).

Response: Rather than creating a third tier for LIP to address

multistate projects, the Service will retain a two-tiered program

during this program implementation period and consider

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evaluating other options in future years based on identified State

needs.

Comment 15. We received two comments that encouraged the Service to

focus proposal review and funding at the ``program'' level and not at

the activity or project level.

Response: Service review of grant proposals will be primarily at

the program level to determine how well the States address the

eligibility requirements for Tier-1 and the criteria for the

competitive scoring process in Tier-2. In addition, we will evaluate

and score the State Tier-2 grant proposals based upon the level of

detail provided, which may focus on projects. Once funds are awarded to

a State, however, the Service will need to evaluate projects to see

that they meet Federal environmental compliance requirements.

Comment 16. We suggest that the proposal selection process make use

of the ``diverse panel of interested and affected parties'' proposed

for the Private Stewardship Grant Program.

Response: The Service intends to create a diverse panel of

professional Service staff to review, rank, and recommend funding to

the Director. They will be knowledgeable about the LIP program, its

objectives, and implementation requirements as well as how other

Federal grant programs are implemented. The Service's expectation is

that the panel will perform in a fair, efficient, and effective manner.

Comment 17. We wish that the program had chosen to allocate funds

based on need and opportunity, rather than a set finite limit of $1.74

million [5% maximum for each State] regardless of opportunity.

Response: The Service proposed limits to ensure opportunities to

all States during this important initial phase of program building.

Since needs and opportunities vary from State to State based upon many

factors, the Service believes that it is important this first year to

encourage national program development and acceptance in as many States

as practical. We believe the 5% maximum per State will lead to a

greater number of species and habitats positively impacted, but will

revisit the cap issue in subsequent years should it appear to be

constraining.

Comment 18. At the very least, the outreach and fund distribution

system are likely to be the same for every Tier-2 grant submitted by

each State, so it would be better to have these aspects described in a

cover letter to the Tier-2 grant package that each State submits.

Response: It is difficult to determine at this time what the States

will submit regarding their plans for outreach and fund distribution.

We believe these are important factors involved with the development of

a strong program. The States will need to describe clearly how they

intend to meet this eligibility requirement for Tier-1 and scoring

criterion for Tier-2 grants in their grant proposal document.

Comment 19. It is unclear whether a State's proposal can include

more than one discrete project, each with its own requested funding

level.

Response: The purpose of the LIP is to help establish or support

State programs that provide, enhance or conserve habitats for at risk

species. States may submit one or more projects within their grant

proposal. Additionally, one or more grant agreement segments may be

used to implement and obligate funds for projects within a grant

proposal. See also the Response to Comment 15.

Comment 20. We are concerned that it will be difficult to submit

proposals, receive funding, and initiate projects in the short time

remaining this Federal fiscal year.

Response: No relationship exists between LIP fund initiation and

expenditure and the Federal fiscal year. The only initial deadline to

meet is the deadline for submission of proposals. Once proposals are

received, approved, and ranked, the Director will announce grant awards

to the States. The obligation of funds for States awarded grants takes

place when the Service approves a grant agreement. One or more projects

may then be initiated, but there is no specific deadline by which work

must begin or end other than that described in the grant agreement.

Comment 21. We believe it is too late in the fiscal year to solicit

proposals and allocate funds. We believe that efficiency and

effectiveness would be greatly enhanced * * * if the FY 02 funds were

rolled over and combined with FY 03 funds, with a single proposal

solicitation used for the combined funds.

Response: Many program commenters and supporters have expressed

their desire to see the program implemented quickly. In addition, it is

possible that no funds will be appropriated by Congress in FY 2003 or

funds may be appropriated with additional or differing requirements.

For these reasons, it is important to proceed with implementation of

LIP for FY 2002 at this time.

Comment 22. The short timeframe for this program will require a

simplified application procedure to allow State agencies time to

develop a timely and complete application.

Response: The application procedure is limited to filling out a

one-page Application for Federal Assistance form and a narrative

describing the key components of the proposal as outlined in these LIP

Final Implementation Guidelines. The proposed 60-day period we are

allowing for submission of grants seems acceptable to most States.

Comment 23. The Federal Register notice states that the Service

will ensure that the funded State projects will comply with the NEPA.

This compliance should be addressed through a categorical exclusion or

the development of a generic environmental analysis finding that

precludes the need for a detailed Environmental Assessment (EA) or

Environmental Impact Statement (EIS).

Response: A generic nationwide EA or EIS is not possible at this

time due to the anticipated variability in the grant proposals

submitted by each State. The Service must review each grant agreement

developed by the States for NEPA compliance. We would apply categorical

exclusions where warranted.

Comment 24. We strongly recommend that the Service monitor this

program and ensure that it does not become bogged down in bureaucratic

red tape and overhead.

Response: The Service will administer the LIP program in a manner

that will move grants quickly through the administrative process and

provide efficient reimbursement processing and project monitoring.

Regional Service contacts will work closely with the States, and their

partner landowners and organizations as needed, to achieve on-the-

ground results.

Comments Related to the Scoring Process and Ranking Criteria

Comment 25. Tier-2 ranking criterion 12(a) regarding detail and

clarity * * * likely will not contribute significantly to

discriminating the value of competing proposals.

Response: The Service believes it is important for proposals to be

well written and clearly describe what the State or territory intends

to accomplish with a grant. This is an important part of the evaluation

process.

Comment 26. Question 24 [of the first LIP notice] addresses the

issue of length of time during which the project improvements are to be

left in place in order to realize the desired benefits. We recommend

adding this to the Tier-2 grant proposal ranking criteria in answer to

Question 12.

Response: We have added an additional ranking criterion (h) (in the

answer to Question 12), that focuses on the anticipated length of

project

[[Page 61646]]

benefits, as well as the urgency of the proposed projects.

Comment 27. In regard to Tier-2 ranking criterion 12(b) on fiscal

management systems, we do not believe that ranking proposals using this

criterion will enhance the program or help insure that the proposals

that contribute most to conservation of at-risk species will be

selected.

Response: Fiscal management and related systems used by agencies

receiving Federal funds and the required accounting for their use are

critical to meeting accountability expectations and implementing an

effective program administratively.

Comment 28. Question 12(b) includes as a Tier-2 grant proposal

ranking criterion ``* * * annual monitoring and evaluation of progress

toward desired project and program objectives (landowner and State).''

We suggest alternate wording, ``* * * desired project objectives

[deleting ``and program''].'' Particularly when funding for the program

must be authorized annually, it seems that LIP objectives would be met

if project objectives are monitored and evaluated.

Response: We disagree. Since LIP is really focused primarily on

establishing and funding programs, the proper barometer is at the

programmatic level which synthesizes project level results. States will

undoubtedly need to conduct monitoring and evaluation at the project

level to determine progress toward program goals and objectives.

Therefore, we have changes in the LIP Final Implementation Guidelines

to reflect the emphasis on program level focus.

Comment 29. I believe that these two criteria (public awareness/

outreach 12(d) and fund distribution 12(c)) are more valuable for a

Tier-1, LIP setup grant than for each individual Tier-2 grant that you

will be evaluating. At the very least they are likely to be the same

for every Tier-2 grant submitted by each State so it would be better to

have these aspects described in the cover letter to the Tier-2 grant

package that each State submits.

Response: The Service believes there could be a high degree of

variability in what States propose for their outreach efforts ((d) in

answer to Question 12). We also recognize the importance public

outreach can have in developing an effective program with good

landowner participation. The Service believes outreach provides a

legitimate area of focus for Tier-1 and as a ranking criterion for

Tier-2. We also believe that fund distribution is an important aspect

of the program and should be a ranking criterion.

Comment 30. It's unclear if a state wildlife agency will be

required to describe cost/benefit components or if this reference is

used merely as an example. The benefits of habitat conservation are

many, but often extremely difficult to quantify. We suggest the portion

of 12(c) * * * cost/benefit components including duration of costs and

benefits be removed from the list of scoring criteria for Tier-2

grants.

Response: Cost/benefit analysis is only one of many ways that a

State may wish to establish, singly or in combination with other

criteria, a fair and equitable system for fund distribution. The

Service will retain this suggested criteria as a potential option to

the States in the answer to Question 12(c).

Comment 31. Two comments suggested that the Tier-2 ranking

criterion 12(g) regarding matching nonfederal funds was rarely an

important factor in program success and had built-in bias against

States not capable of increasing their nonfederal matching funds. They

suggest that it should either be eliminated or reduced in its

allocation of scoring points. Another comment was made suggesting an

alternate [to using matching funds as a ranking criterion] would be to

award more points to those proposals with a higher number of State,

Federal, or private partners.

Response: The Service grant programs serve as vehicles for States

and other entities to accomplish conservation and management activities

that would otherwise not have funding. Encouraging the leveraging of

Federal dollars has served as an important tool in bringing partners

together and developing support for these activities. We believe those

States maximizing this effort should be recognized to some degree in

the ranking process. Nonetheless we have reduced the total number of

points that can be scored in this category to acknowledge the challenge

confronted by some agencies.

Comment 32. We recommend Tier-2 ranking criterion 12(e) be modified

to consider the proportion of at-risk species within the State,

territory, or district [that is to be addressed by the grant proposal].

Response: To consider this modification, it would require each

State to develop a complete list of all species they deem to be at-risk

within their jurisdiction prior to applying for any grant. We believe

that this requirement would likely result in a long deliberative

process, with large variability among States, with minimal benefit to

the program.

Comment 33. A [new] ranking criterion for Tier-2 grants should

consider the urgency of the project to the target species. We encourage

scoring criterion 12(e) for Tier-2 grants be modified to represent more

a measure of the overall contributions of the project to conservation

of the species benefitted.

Response: We have created an additional ranking criterion 12(h) to

address the urgency and duration of benefits for species identified in

the proposed projects.

Comment 34. Individual projects in Hawaii and California are very

likely to benefit over a dozen listed species * * * [thus restructuring

the scoring for Tier-2 criterion (e)] would be more useful if it was 1-

4 species (1 point), 5-10 species (2 points), and 10 species

(3 points). And, reduce the total points possible for all criteria.

Response: We believe a large number of total points possible will

enable reviewers to more accurately discern true differences between

grossly similar grant proposals. We also believe the number of species

benefitted is a valid scoring criterion. We have, however, added

another species-related ranking criterion (h) that will expand the

scoring to also include the urgency of the project to the species

benefitted.

Comment 35. Tier-2 ranking criterion 12(e) should be expanded to

include the relative conservation risk of the species identified in the

application.

Response: As stated previously in the response to Comment 34, we

have created an additional ranking criterion 12(h) to address the

urgency and duration of benefits for species identified in the proposed

projects.

Comment 36. More qualitative flexibility to allow consideration of

this broader State context (relative to administration) needs to be

incorporated into ranking criterion 12(f) for Tier-2.

Response: We have reduced the weighting of this criterion due to

this comment and others that indicate a need to consider the variation

in current capabilities of some State agencies to address their

administrative needs.

Comment 37. We suggest that this criterion (12(f)) be amended to

consider the percentage of the State's total Tier-2 program funds

rather than the percentage of the State's total LIP program funds

(which we assume would include the combined funds from Tier-1 and Tier-

2 grants).

Response: We agree this is not clear and have made the suggested

changes to ranking criterion 12(f) in this final notice.

[[Page 61647]]

Comment 38. We feel the scoring criterion 12 (f) (for Tier-2

grants) unfairly benefits those State wildlife agencies with the

greatest capacity to deliver private lands programs. We recommend it be

removed or its scoring weight reduced by at least 50%.

Response: Based on this and related comments we have reduced the

weighting of this criterion from 10 possible points to five.

Comment 39. Comments on Tier-2 scoring criterion 12 (h) [of the

first LIP notice], regarding proposals identifying performance measures

that support the Service performance goals, ranged from replacing this

scoring criterion with one that focuses on specific species

reproductive improvements, to deleting the criterion entirely.

Response: President Bush has launched a new strategy for improving

the management and performance of the Federal Government. The

quantified measures to be included with each proposal to be eligible

under LIP will help achieve the overall program goal to conserve

habitat for endangered, threatened or other at risk species on private

lands. Through LIP, State programs to assist private, voluntary

conservation efforts will help the Service meet its Long-Term and

Annual Performance Goals as expressed in the Service's Annual

Performance Plan. The LIP furthers the Service's goals for conserving

imperiled species (Goal 1.2) and habitat conservation (Goal 2.3).

Further information on the Service's strategic plans and performance

reports is available at http://planning.fws.gov.

The Service believes that there is merit in evaluating LIP projects

and how grants assist meeting LIP and Service goals. Rather than

including performance measures in the ranking criteria, however, we are

requiring the State to:

(a) for Tier-1 grant proposals--Describe the process by which the

State will develop clear, obtainable, and quantified performance

measures to help it meet LIP program goals and objectives; and

(b) for Tier-2 grant proposals--Identify clear, obtainable, and

quantified performance measures related to the Habitat Conservation and

Sustainability of Fish and Wildlife Populations goals in the expected

results or benefits section of the grant proposal narrative.

Additionally, we have modified selection criteria 12(b) to require

States to identify how their management systems will adequately monitor

and evaluate progress in achieving its goals through these performance

measures.

Comment 40. The only comments concerning the Tier-1 eligibility

requirements recommended eliminating criterion (g) that would identify

performance measures that support Service performance goals.

Response: See the response to Comment 39.

Comment 41. One commenter preferred reducing the total points for

all scoring criteria.

Response: We have reduced total points for some ranking criteria

where comments supported that reduction.

Comment 42. One commenter suggested a general or ``other proposal

merits'' scoring criterion that would include how the project might

complement other projects in the area, its unique qualities, enhanced

nonfederal cost sharing, or other extraordinary benefits.

Response: We found it difficult to create a multifaceted ranking

criterion, unlike those that have more specific and measurable

components, and therefore have not included one in the Implementation

Guidelines.

Comment 43. A criterion for Tier-2 ranking should include the

magnitude and duration of benefits.

Response: Ranking criteria (a) and (h) (see answer to Question 12)

should adequately capture the magnitude and duration of benefits of the

projects.

Required Determinations

Regulatory Planning and Review

This policy document identifies eligibility and selection criteria

the Service will use to award grants under LIP. The Service developed

these guidelines to ensure consistent and adequate evaluation of grant

proposals that are voluntarily submitted and to help perspective

applicants understand how the Service will award grants. According to

Executive Order (E.O.) 12866, these policy guidelines are significant

and the Office of Management and Budget has reviewed them in accordance

with the four criteria discussed below.

(a) LIP will not have an annual effect on the economy of $100

million or more or adversely affect in a material way the economy, a

sector of the economy, productivity, jobs, the environment, public

health or safety, or State or local communities. A total of $34,800,000

will be awarded in grants to State and Territorial wildlife agencies to

provide financial and technical assistance to private landowners to

carry out voluntary conservation actions. These funds will be used to

pay for the administration and execution of actions such as restoring

natural hydrology to streams or wetlands that support species of

concern, fencing to exclude livestock from sensitive habitats, or

planting native vegetation to restore degraded habitat. In addition,

grants that are funded will generate other, secondary benefits,

including benefits to natural systems (e.g., air, water) and local

economies. All of these benefits are widely distributed and are not

likely to be economically significant in any single location. It is

likely that some residents where projects are initiated will experience

some level of benefit, but quantifying these effects at this time is

not possible. We do not expect the sum of all the benefits from this

program, however, to have an annual effect on the economy of $100

million or more.

(b) We do not believe LIP would create inconsistencies with other

agencies' actions. Congress has given the Service the responsibility to

administer the program.

(c) As a new grant program, LIP would not materially alter the

budgetary impact of entitlements, user fees, loan programs, or the

rights and obligations of their recipients. This policy establishes a

new grant program that Public Law 107-63 authorizes, which should make

greater resources available to applicants. The submission of grant

proposals is completely voluntary, but necessary to receive benefits.

When an applicant decides to submit a grant proposal, the eligibility

and selection criteria identified in this policy can be construed as

requirements placed on the awarding of the grants. Additionally, we

will place further requirements on grantees that are selected to

receive funding under LIP in order to obtain and retain the benefit

they are seeking. These requirements include specific Federal financial

management and reporting requirements and time commitments for

maintaining habitat improvements or other activities described in the

applicant's grant proposal.

(d) OMB had determined that these guidelines raise novel legal or

policy issues, and, as a result, this document has undergone OMB

review.

Regulatory Flexibility Act (5 U.S.C. 601 et seq.)

Under the Regulatory Flexibility Act (5 U.S.C. 601 et seq., as

amended by the Small Business Regulatory Enforcement Fairness Act

(SBREFA) of 1996), whenever an agency is required to publish a notice

of rulemaking for any proposed or final rule, it must prepare and make

available for public comment a regulatory flexibility analysis that

describes the effects of the rule on small

[[Page 61648]]

entities (i.e., small businesses, small organizations, and small

government jurisdictions). No regulatory flexibility analysis is

required, however, if the head of the agency certifies the rule will

not have a significant economic impact on a substantial number of small

entities. SBREFA amended the Regulatory Flexibility Act to require

Federal agencies to provide a statement of the factual basis for

certifying that a rule will not have a significant economic impact on a

substantial number of small entities. SBREFA also amended the RFA to

require a certification statement. In this notice, we are certifying

that LIP will not have a significant economic impact on a substantial

number of small entities for the reasons described below.

Small entities include organizations, such as independent nonprofit

organizations and local governmental jurisdictions, including school

boards and city and town governments that serve fewer than 50,000

residents, as well as small businesses. Small businesses include

manufacturing and mining concerns with fewer than 500 employees,

wholesale trade entities with fewer than 100 employees, retail and

service businesses with less than $5 million in annual sales, general

and heavy construction businesses with less than $27.5 million in

annual business, special trade contractors doing less than $11.5

million in annual business, and agricultural businesses with annual

sales less than $750,000. To determine if potential economic impacts to

these small entities are significant, we consider the types of

activities that might trigger impacts as a result of this program. In

general, the term significant economic impact is meant to apply to a

typical small business firm's business operations.

The types of effects this program could have on small entities

include economic benefits resulting from the purchasing of supplies or

labor to implement the grant proposals in relation to habitat

improvements on private lands. By law, only State and Territorial

wildlife agencies are eligible grant recipients. Since this program

will be awarding a total of only $34,800,000 for grants throughout the

United States to benefit wildlife habitat on private lands, a

substantial number of small entities are unlikely to be affected. The

benefits from this program will be spread over such a large area that

it is unlikely that any significant benefits will accrue to a

significant number of entities in any area. In total, the distribution

of the $34,800,000 will not create a significant economic benefit for

small entities but, clearly a number of entities will receive some

benefit.

Unfunded Mandates Reform Act

In accordance with the Unfunded Mandates Reform Act (2 U.S.C. 1501

et seq.):

(a) This policy will not ``significantly or uniquely'' affect small

government entities.

(b) This policy will not produce a Federal mandate of $100 million

or greater in any year; that is, it is not a ``significant regulatory

action'' under the Unfunded Mandates Reform Act. LIP establishes a

grant program that States may participate in voluntarily.

Takings

In accordance with Executive Order 12630 (``Government Actions and

Interference with Constitutionally Protected Private Property

Rights''), LIP does not have significant takings implications. State

and Territorial agencies will work with private landowners who

voluntarily request technical and financial assistance for species

conservation on their lands.

Executive Order 13211

On May 18, 2001, the President issued an Executive Order (E.O.

13211) on regulations that significantly affect energy supply,

distribution, and use. Executive Order 13211 requires agencies to

prepare Statements of Energy Effects when undertaking certain actions.

This policy is not expected to significantly affect energy supplies,

distribution, or use. Therefore, this action is not a significant

energy action and no Statement of Energy Effects is required.

Federalism

In accordance with Executive Order 13132, this policy does not have

any Federalism effects. A Federalism assessment is not required.

Congress has directed that we administer grants under LIP directly to

the States and Territories. The States have the authority to decide

which private landowner projects to forward to the Service for

consideration as their LIP.

Civil Justice Reform

In accordance with Executive Order 12988, LIP does not unduly

burden the judicial system and does meet the requirements of sections

3(a) and 3(b)(2) of the Order. With the guidance in this policy and

these guidelines, the Service will clarify the requirements of LIP to

applicants that voluntarily submit grant proposals.

National Environmental Policy Act

The issuance of this policy and implementation guidelines does not

constitute a major Federal action significantly affecting the quality

of the human environment. The Service has determined that the issuance

of the policy and guidelines is categorically excluded under the

Department of the Interior's NEPA procedures in 516 DM 2, Appendix 1

and 516 DM 6, Appendix 1. The Service will ensure that grants that are

funded through LIP are in compliance with NEPA.

Government-to-Government Relationship With Tribes

In accordance with the President's memorandum of April 29, 1994,

``Government-to-Government Relations With Native American Tribal

Governments'' (59 FR 22951), E.O. 13175, and the Department of the

Interior's manual at 512 DM 2, we readily acknowledge our

responsibility to communicate meaningfully with federally recognized

Tribes on a government-to-government basis.

This policy document deals only with the LIP program as it relates

to States and Territories. Under Public Law 107-63, Title I, Tribes are

also eligible grantees. The Service is preparing a separate policy

document which will be applicable to the tribal component of the LIP

program.

Paperwork Reduction Act

We made application to OMB for approval of the information

collection requirements for this program in conjunction with the above

Federal Register notice published June 7, 2002. That application seeks

to revise the Federal Grants Application Booklet (1018-0109) to include

additional hours for this new burden. OMB approved this request August

12, 2002. An agency may not conduct or sponsor, and a person is not

required to respond to, a collection of information unless it displays

a currently valid OMB control number.

Authority

This notice is published under the authority of the Department of

the Interior and Related Agencies Appropriations Act, 2002, H.R. 2217/

Pub. L. 107-63.

Dated: August 15, 2002.

David P. Smith,

Acting Assistant Secretary for Fish and Wildlife and Parks.

[FR Doc. 02-24859 Filed 9-30-02; 8:45 am]

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