Small Farmer Outreach Training and Technical Assistance Program

DEPARTMENT OF AGRICULTURE

Rural Housing and Community Development Service

Rural Business and Cooperative Development Service

Rural Utilities Service

Consolidated Farm Service Agency

7 CFR Chapter XVIII and Part 1943

RIN 0575-AB74

Small Farmer Outreach Training and Technical Assistance Program

AGENCIES: Rural Housing and Community Development Service, Rural

Business and Cooperative Development Service, Rural Utilities Service,

and Consolidated Farm Service Agency, USDA.

ACTION: Interim rule with request for comments.

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SUMMARY: The Consolidated Farm Service Agency (CFSA) is the successor

to the Farmers Home Administration pursuant to Section 226 of the

Federal Crop Insurance Reform Act of 1994 (Pub. Law 103-354, 108 stat.

3178, October 13, 1994). The CFSA is establishing a regulation whereby

under the procedures of the Small Farmer Outreach Training and

Technical Assistance Program and the Outreach and Assistance Grants for

Socially Disadvantaged Farmers and Ranchers Program, an 1890 Land Grant

Institution or other eligible educational institution or community-

based organization could enter into a cooperative or other agreement

with CFSA to provide outreach, training, and technical assistance to

small-scale farmers, especially members of socially disadvantaged

groups. This action is necessary to implement the provisions in the

Food, Agriculture, Conservation, and Trade Act of 1990, title XXV,

Section 2501 and the U.S. Department of Agriculture (USDA)

appropriation acts which provide funding for this program. The intended

effect of this action is to assist small farmers and socially

disadvantaged farmers and ranchers by making them aware of programs

available through the USDA. In addition, this rule amends 7 CFR chapter

XVIII to reflect the abolishment of the Farmers Home Administration and

the Rural Development Administration and the establishment of the Rural

Housing and Community Development Service, the Rural Business and

Cooperative Development Service, the Rural Utilities Service, and the

Consolidated Farm Service Agency in the recent Department of

Agriculture reorganization.

DATES: Interim rule effective December 27, 1994. Comments must be

received by February 27, 1995.

ADDRESSES: Submit written comments, in duplicate, to the Office of the

Chief, Regulations Analysis and Control Branch, Rural Economic and

Community Development (RECD), U.S. Department of Agriculture, Room

6348, South Agriculture Building, Washington, D.C. 20250. All written

comments made pursuant to this notice will be available for public

inspection during regular working hours at the above address.

FOR FURTHER INFORMATION CONTACT: John Just-Buddy, National Project

Coordinator, Special Programs Unit, or Geraldine Herring, Program

Analyst, Farmer Programs, Consolidated Farm Service Agency, USDA, room

4929, South Agriculture Building, 14th and Independence Avenue, S.W.,

Washington, D.C. 20250, Telephone (202) 720-1636.

SUPPLEMENTARY INFORMATION:

Classification

This rule has been determined to be not-significant for purposes of

Executive Order 12866 and therefore has not been reviewed by OMB.

Intergovernmental Consultation

For reasons set forth in the final rule related to Notice 7 CFR,

part 3015, subpart V (48 FR 29115, June 24, 1983) and FmHA Instruction

1940-J, this program is not subject to the provisions of Executive

Order 12372 which requires intergovernmental consultation with State

and local officials.

Paperwork Reduction Act

The information collection requirements contained in Sec. 1943.111

have been approved by the Office of Management and Budget (OMB) and

have been assigned OMB control number 0575-0156, under the provisions

of 44 U.S.C. Chapter 35. The remaining information collection and

recordkeeping requirements contained in this regulation will not become

effective until approved by OMB, in accordance with the Paperwork

Reduction Act of 1980. Please send written comments to the Office of

Information Regulatory Affairs, OMB, Attention: Desk Officer for USDA,

Washington, D.C. 20503. Please send a copy of your comments to Jack

Holston, Agency Clearance Officer, USDA, RECD, Ag Box 0743, Washington,

D.C. 20250.

Civil Justice Reform

This document has been reviewed in accordance with Executive Order

(E.O.) 12778. It is the determination of CFSA that this action does not

unduly burden the Federal Court System in that it meets all applicable

standards provided in section 2 of the Executive Order.

Programs Affected

This action affects the following programs as listed in the Catalog

of Federal Domestic Assistance:

10.406--Farm Operating Loans

10.407--Farm Ownership Loans

Environmental Impact Statement

This document has been reviewed in accordance with 7 CFR part 1940,

subpart G, ``Environmental Program.'' It is the determination of CFSA

that this action does not constitute a major Federal action

significantly affecting the quality of the human environment, and, in

accordance with the National Environmental Policy Act of 1969, Public

Law 91-190, an Environmental Impact Statement is not required.

Background

In July 1993, Farmers Home Administration (FmHA) initiated, under

Section 2501 of the Food, Agriculture, Conservation, and Trade Act of

1990, the Outreach and Assistance Grants for Socially Disadvantage

Farmers and Ranchers program. The program was established by an

internal funds transfer, in the amount of $1 million received on August

13, 1993, from Extension Service.

A Notice was published in the Federal Register on July 2, 1993, [58

FR 35911-35914], Outreach and Assistance Grants for Socially

Disadvantaged Farmers and Ranchers, and no adverse comments were

received. The Notice was to solicit recipients and give guidance to

eligible applicants on submitting proposals for the program.

Discussion of Interim Rule

Outreach and Assistance Grants for Socially Disadvantaged Farmers

and Ranchers is authorized under Section 2501 of the Food Agriculture,

Conservation, and Trade Act of 1990 (7 U.S.C. 2279). Three million

dollars will remain available until expended. It was the intent of

Congress to have funds available to provide outreach and technical

assistance to encourage and assist socially disadvantaged farmers and

ranchers to own and operate farms and ranches and to participate in

agricultural programs. This assistance should enable socially

disadvantaged farmers and ranchers to obtain information on application

and bidding procedures, farm management, and other essential

information to participate in agricultural programs.

The definition of Agricultural programs contained in 1943.104 of

this subpart is based on the programs authorized by the statutes

referenced in Section 2501 (e)(3) of the FACT Act. As authorized by

Section 2501 (e)(3)(G), FmHA has designated additional USDA programs as

Agricultural program based on its belief that the participation of

socially disadvantaged farmers and ranchers in these programs will

serve an important public purpose. The definition of Agricultural

program references many of USDA's programs, however, the list is not

intended to be all inclusive. Rather, the regulation intends to

increase participation by socially disadvantaged farmers and ranchers

in all USDA programs which are agricultural in nature. However, because

the program is carried out by CFSA employees, the outreach efforts by

CFSA personnel to recipients will require the personnel to provide

information about CFSA agricultural loans only until such time as

information on the other USDA agricultural programs becomes available.

Need for the Interim Rule:

To implement, this year, a program that directly addresses

the decline of minority farmers and ranchers.

To immediately put into effect what is a clear and

pressing goal of the Administration. On November 1, 1993, President

Clinton issued Executive Order 12876, that directs the Government to

support Historically Black Colleges and Universities (HBCU's) and to

provide opportunities to participate in and benefit from federal

programs. These institutions are a major beneficiary of this funding.

In addition, under Section 2501, Outreach and Assistance

for Socially Disadvantaged Farmers and Ranchers, non-HBCU's entities,

i.e., Indian Tribal community colleges and Hispanic serving post-

secondary educational institutions will be in the population served.

To allow funds to be used in FY 95 that will provide

assistance in advance of planting and building for the upcoming crop

year.

The application of this program will help in development

of the components in the '95 Farm Bill aimed at stabilizing socially

disadvantaged family farmers.

As services are consolidated and agencies change as a

result of reorganization of USDA, the socially disadvantaged

population, whom these funds are targeted at, will be able to receive

the necessary assistance to understand and gain access to the newly

reorganized USDA.

It is the policy of this Department that rules relating to public

property, loans, grants, benefits, or contracts will be published for

comment not withstanding the exemption of 5 U.S.C. 553. However, the

Department is publishing this rule as an interim rule which will take

effect immediately upon publication in the Federal Register without

securing prior public comment.

The Agency is taking this action because the funds which will be

distributed in the fiscal year 1995 are not being distributed under a

typically new action or proposal which will affect the public. Rather

the funds will go to organizations whose five years' plans were

selected for funding pursuant to the July 2, 1993, Notice so that the

organizations can continue to provide information and assistance to

socially disadvantaged farmers and ranchers. Moreover, since that

Notice provided the criteria for obtaining funding, the organizations

which are affected by this action (which contains similar requirements)

have actual notice of the applicable standards.

Organizations whose proposals were not selected for funding in 1993

and organizations submitting new proposals are not immediately affected

by this action because they will not receive funding in this fiscal

year. Also, these organizations will have the opportunity to comment on

the interim rule because their comments will be considered before any

truly new money could be distributed in the fiscal year 1996. Only

$3,000,000 was appropriated for this program for the fiscal year 1994,

and $2,995,000 for the fiscal year 1995. The same amount may not be

appropriated in subsequent years. However, it is the Agency's

expectation that funds will be appropriated for this program either as

a separate item or as part of the general appropriations for the Agency

in the future years. Therefore, the interim rule establishes guidelines

for administering the program for future years.

Program Description

1. The regulation being developed embodies the content of the

original notice, published on July 2, 1993. The interested parties are

fully aware of the procedures and standards intended for this program.

2. The program's objective is to reverse, through the use of the

Outreach Training and Technical Assistance Program, the decline of

socially disadvantaged farmers and ranchers across the United States.

This outcome will be reached by encouraging and assisting

socially disadvantaged farmers and ranchers to own and operate their

own farms, participate in agricultural programs, and become an integral

part of the agricultural community.

The recipients of these grants will provide services to

socially disadvantaged farmers and ranchers and small farmers through

outreach training and technical assistance in farm and ranch

management, recordkeeping, marketing techniques and in testing

innovative solutions to existing or anticipated issues or problems they

may encounter.

Under the interim rule, CFSA will solicit proposals, and five-year

plans to be funded on a competitive basis. The solicitation is

encouraged from community-based organizations, 1890 Land Grant

colleges, including Tuskegee University, Indian Tribal Community

Colleges and Alaska Native cooperative colleges, Hispanic serving post-

secondary educational institutions, and other post-secondary

educational institutions with demonstrated experience in providing

agriculture education or other agricultural related services to

socially disadvantaged family farmers and ranchers in their region.

The proposals will be evaluated by a panel of Agency technical

experts to determine which proposals are most meritorious. The panel of

Agency technical experts are necessary to evaluate what is expected to

be a variety of very technical proposals. The evaluation panel will

make recommendations to the appropriate Agency official to be forwarded

to the Agency Head, who will consult with, if necessary, the Secretary

of USDA before a final decision on awarding the grants or cooperative

agreements is made.

To assure a consistency in the evaluation process the interim rule

establishes a set of evaluation criteria to assure the proposal is

consistent with the intent of the program and is worth the funds that

are to be spent on the project.

The accounting for the funds awarded for the cooperative or other

agreement will be subject to the normal rules for such agreements

within USDA as given in part 3016 of this title. The proposed

application format is used to assure that sufficient information is

obtained to complete an agreement as given in part 3016 of this title.

In addition, the application format is similar to that used by other

USDA Agencies for their competitive grants programs.

List of Subjects in 7 CFR Part 1943

Credit, Loan Programs--Agriculture.

Accordingly, 7 CFR chapter XVIII and part 1943 are amended as

follows:

1. The heading of 7 CFR chapter XVIII is revised to read as

follows:

CHAPTER XVIII--RURAL HOUSING AND COMMUNITY DEVELOPMENT SERVICE, RURAL

BUSINESS AND COOPERATIVE DEVELOPMENT SERVICE, RURAL UTILITIES SERVICE,

AND CONSOLIDATED FARM SERVICE AGENCY, DEPARTMENT OF AGRICULTURE

2. In 7 CFR chapter XVIII (consisting of parts 1800-2099),

everywhere ``Farmers Home Administration'', ``FmHA'', ``FHA'', ``Rural

Development Administration'', or ``RDA'' are mentioned add the

following immediately thereafter ``or its successor agency under Public

Law 103-354''.

PART 1943--FARM OWNERSHIP, SOIL AND WATER AND RECREATION

3. The authority citation for part 1943 is revised to read as

follows:

Authority: 7 U.S.C. 1989; 42 U.S.C. 1480; 5 U.S.C. 301; 7 CFR

2.23 and 2.70.

4. Subpart C of part 1943 is added to read as follows:

PART 1943--FARM, OWNERSHIP, SOIL AND WATER AND RECREATION

Subpart C--Small Farmer Outreach Training and Technical Assistance

Program

Sec.

1943.101 General.

1943.102 Objectives.

1943.103 Project period.

1943.104 Definitions.

1943.105 Eligible entities.

1943.106-1943.110 [Reserved]

1943.111 Process for consideration.

1943.112-1943.114 [Reserved]

1943.115 Authorized use of funds.

1943.116-1943.125 [Reserved]

1943.126 Other applicable Federal statutes - and regulations that

apply.

1943.127 Fund disbursement.

1943.128 Financial management systems and - reporting requirements.

1943.129-1943.135 [Reserved]

1943.136 Standards of conduct for employees - of recipient.

1943.137 Monitoring compliance and penalty for - noncompliance.

1943.138-1943.140 [Reserved]

1943.141 Nondiscrimination.

1943.142 Environmental requirements.

1943.143-1943.150 [Reserved]

Sec. 1943.101 General.

This subpart provides procedures for administration of the Small

Farmer Outreach Training and Technical Assistance Program whereby an

1890 or other eligible educational institution or community-based

organization as referenced in Sec. 1943.105 of this subpart, also

referred to as the recipient, enters into a grant, cooperative, or

other agreement with the Consolidated Farm Service Agency (CFSA) to

provide outreach, training, and technical assistance to members of

socially disadvantaged groups to own and operate farms and ranches and

to participate in agricultural programs.

Sec. 1943.102 Objectives.

To meet the objectives of the program referenced in paragraphs (a)

and (b) of this section, CFSA will fund grant agreements, cooperative

agreements, or enter into Memorandums of Understanding (MOU) with

recipients as referenced in Sec. 1943.105 of this subpart, for Small

Farmer Outreach Training and Technical Assistance Projects which are

determined to meet the objectives of the program:

(a) The long-term objective of the Small Farmer Outreach Training

and Technical Assistance Program is to keep small farmers, especially

those who are members of socially disadvantaged groups, on the farm and

strengthen the rural economy.

(b) An immediate objective of the Small Farmer Outreach Training

and Technical Assistance Program is to encourage and assist members of

socially disadvantaged groups to own and operate farms and ranches and

to participate in agricultural programs.

Sec. 1943.103 Project period.

A cooperative agreement or other agreement will specify a project

for a period generally of 5 years, with an option for renewal up to the

5-year period, subject to the availability of funds or termination of

the project by mutual agreement or for cause.

Sec. 1943.104 Definitions.

For the purpose of the Small Farmer Outreach Training and Technical

Assistance Program, the following definitions are applicable:

Agricultural programs. Eligible programs shall include, but are not

limited to, one or more of the following programs: Agricultural

conservation program, programs comprising the environmental

conservation acreage reserve program (ECARP), conservation technical

assistance program, emergency conservation program, forestry incentives

program, Great Plains Conservation Program, integrated farm management

option program, price support and production adjustment programs, rural

environmental conservation program, soil survey program, and water bank

program; also the farm loan programs (farm ownership, operating, soil

and water, and emergency loans) of the CFSA.

Awarding official. The Administrator of the CFSA or designee.

Community-based organization. Those nonprofit, nongovernment

organizations with a well defined constituency that includes all or

part of a particular community, e.g., communities consisting of

socially disadvantaged farmers and ranchers. Socially disadvantaged

farmers and ranchers must play a role in the development and

implementation of any program or project undertaken by the

organization.

Cooperative agreement. The same meaning as ``grant,'' except that,

at the time a cooperative agreement is awarded, substantial involvement

is anticipated between CFSA, acting for the Federal Government, and the

recipient during performance under the agreement. (Refer to Exhibit A

of FmHA Instruction 1943-C (available in any State office).)

Grant. For purposes of this regulation, an award by CFSA, acting

for the Federal Government, of money to the recipient with the

following characteristics:

(1) The principal purpose of the award is to accomplish a public

purpose authorized by statute, rather than acquisition, by purchase,

lease, or barter, of property or services for the direct benefit or use

of the Federal Government; and

(2) At the time an award is made, no substantial involvement is

anticipated between CFSA, acting for the Federal Government, and the

recipient.

Memorandum of Understanding (MOU). For purposes of this regulation,

a documented plan between CFSA and the recipient or recipients for

carrying out their separate activities in a project of mutual interest.

When an understanding is reached as to the area of operations and

duties to be performed by the parties concerned, each party directs its

own activities and utilizes its own resources. An MOU is not a fund

obligation document since it does not directly involve a financial

assistance transaction.

Project. The total activities within the scope of the program as

identified in the MOU, grant, cooperative or other agreement.

Project Director. The individual who is responsible for the

project, as designated by the recipient in the project proposal and

approved by the awarding official. The project director will devote

full time to the administration of the project.

Project period. The total time approved by the awarding official

for conducting the proposed project as outlined in an approved project

proposal or the approved portions thereof and as specified in the

cooperative or other agreement.

Recipient. For purposes of this subpart, an entity as defined in

Sec. 1943.105 of this subpart that has entered into an MOU, grant, or

cooperative or other agreement with CFSA.

Socially disadvantaged farmer or rancher. A farmer or rancher who

is a member of a socially disadvantaged group. (For entity applicants,

the majority interest has to be held by socially disadvantaged

individuals.)

Socially disadvantaged group. A group whose members have been

subject to racial, ethnic, or gender prejudice because of their

identity as members of a group without regard to their individual

qualities. Socially disadvantaged groups consist of Women, African-

Americans, Native Americans, Alaskan Natives, Hispanics, Asians, and

Pacific Islanders.

Sec. 1943.105 Eligible Entities.

(a) CFSA will consider proposals only from:

(1) 1890 Land-Grant Colleges, including Tuskegee University.

(2) Indian tribal community colleges.

(3) Alaska native cooperative colleges.

(4) Hispanic-serving post-secondary educational institutions.

(5) Other post-secondary educational institutions with demonstrated

experience in providing agricultural education or other agriculturally-

related services to socially disadvantaged farmers or ranchers in their

region.

(6) Any community-based organization that:

(i) Has demonstrated experience in providing agricultural education

or other agriculturally-related services to socially disadvantaged

farmers and ranchers;

(ii) Provides documentary evidence of its past experience in

working with socially disadvantaged farmers and ranchers during the 2

years preceding its application for assistance; and

(iii) Does not engage in activities prohibited under Section

501(c)(3) of the Internal Revenue Code of 1986.

(b) In addition to those entities referenced in paragraph (a) of

this section, an applicant must:

(1) Have adequate financial resources for performance and the

necessary experience, organizational and technical qualifications, and

facilities or a firm commitment, arrangement, or ability to obtain same

(including any to be obtained through subagreement(s));

(2) Have the ability to comply with the proposed or required

completion schedule for the project;

(3) Have an adequate financial management system and audit

procedures that provide efficient and effective accountability and

control of all funds, property, and other assets;

(4) Have a satisfactory record of performance, including, in

particular, any prior performance under grants, contracts, or

cooperative agreements from the Federal Government; and

(5) Otherwise be qualified and eligible to receive funding for a

grant agreement, cooperative agreement, or other agreement under the

applicable laws and regulations.

Secs. 1943.106-1943.110 [Reserved]

Sec. 1943.111 Process for consideration.

(a) A program solicitation will be published in the Federal

Register and such other publication(s) as deemed appropriate, as early

as practicable every 5 years that funds will be available for new

project use and at other appropriate times.

(b) The project proposal must contain the following information:

(1) Background and need for the project. Explain the circumstances

which necessitate a Small Farmer Outreach Training and Technical

Assistance Project within the State to serve small farmers, especially

members of socially disadvantaged groups.

(2) Objectives and goals proposed to meet the objectives. Clearly

state the objectives of the project, which should be in line with the

objectives of the program stated in Sec. 1943.102 of this subpart, and

explain the goals proposed to meet the objectives.

(3) Statement of Work, including staffing. Describe the plan of

action for meeting the objective of the Small Farmer Outreach Training

and Technical Assistance Program and the necessary staffing.

(4) Proposed budget.

(i) Submit a proposed budget for each of the 5 years, showing line-

by-line cost items for the proposed project. Include any in-kind

contributions to be provided.

(ii) Show all funding sources and itemize costs by the following

line items: personnel costs, equipment, material and supplies, travel,

and all other costs.

(iii) Salaries of project personnel who will be working on the

project may be requested in proportion to the effort that they will

devote to the project.

(iv) Funds may be requested under any of the line items listed

above provided that the item or source for which support is requested

is identified as necessary for successful conduct of the project, is

allowable under the authorizing legislation and applicable Federal cost

principles, and is not prohibited under any applicable Federal statute.

(5) Identification of personnel. Incorporate into the proposal the

resumes of all anticipated personnel, including the Project Director.

Also discuss the experience, qualifications, and availability of all

personnel, including the Project Director, to direct and carry out the

project.

(c) The State Office will review the proposal and forward the

proposal to the National Office Project Manager, within 15 days of

receipt, with the State Office's recommendations.

(d) The National Office will make a preliminary review of the

proposal and reserves the right to return it to the State Office with

any questions or comments to be clarified by the 1890 or other eligible

educational institution or community-based organization. A time period

for resubmission will be specified.

(e) All proposals from entities eligible for funding under

Sec. 1943.105 of this subpart shall be evaluated for funding

consideration. To assist in the evaluation and obtain the best possible

balance of viewpoints for funding consideration, a proposal review

panel will be used. The proposal review panel will be selected and

organized to provide maximum expertise and objective judgment in the

evaluation of proposals. The proposal review panel will use Form FmHA

1943-2, ``EVALUATION--Small Farmer Outreach Training and Technical

Assistance Program,'' to evaluate each proposal. The proposal review

panel will evaluate each proposal against the five criteria using the

following scale: Highly Responsive (5); Fully Responsive (3);

Marginally Responsive (1); and Not Responsive (0). The criteria used by

the proposal review panel and the criteria weights are:

(1) Feasibility and Policy Consistency (3.5). Degree to which the

proposal clearly describes its objective and evidences a high level of

feasibility and consistency with United States Department of

Agriculture (USDA) policy and CFSA mission.

(2) Institutional Commitment (3.5). Degree to which the institution

or organization is committed to the project, as shown by funds, in-kind

services, or historical success in meeting the objectives of the

program.

(3) Number of Counties and Farmers Served (3.5). Degree to which

the proposal reflects collaborative approaches in meeting with other

agencies or organizations to enhance the objectives of the program.

Also, the areas and number of farmers who would benefit from the

services offered.

(4) Socially Disadvantaged Applicants--Outreach (3.5). Degree to

which the proposal contains efforts to reach persons identified as

socially disadvantaged farmers and ranchers in designated counties.

(5) Preparatory Features--Statement of Work (6.0). Degree to which

the proposal reflects special innovative features to attract, interest,

and improve the economical and social conditions of socially

disadvantaged farmers and ranchers.

(f) The final decision to award is at the discretion of the

awarding official. The awarding official shall consider the ranking,

comments, and recommendations from the proposal review panel and any

pertinent information before deciding which applications to approve and

the order of approval. The awarding official will notify in writing

entities whose proposals are rejected. In accordance with Sec. 1900.55

of subpart B of part 1900 of this chapter, appeal rights will be

provided only to those entities identified as eligible under

Sec. 1943.105 of this subpart.

(g) After a decision regarding funding is made, CFSA and the

recipient which is selected will enter into a grant or cooperative

agreement. The awarding official will notify the recipient of approval

and inform them of the necessary documents needed to execute the

agreement. If no funding is involved, CFSA and the recipient will enter

into an MOU.

Secs. 1943.112-1943.114 [Reserved]

Sec. 1943.115 Authorized use of funds. -

Any funds authorized under this subpart will be used solely for the

operation and administration of the Small Farmer Outreach Training and

Technical Assistance Program specifically for the project under the

cooperative or other agreement. There is no other authorized use of the

funds. Eligible costs are limited to those line items specified in

Sec. 1943.111 (b)(4) of this subpart.

Secs. 1943.116-1943.125 [Reserved]

Sec. 1943.126 Other applicable federal statutes and regulations that

apply. -

Several other Federal statutes and regulations apply to proposals

considered for review or cooperative and other agreements awarded under

the program. These include, but are not limited to the following:

(a) 7 CFR part 1b--USDA Implementation of the National

Environmental Policy Act;

(b) 7 CFR part 3--USDA implementation of OMB Circular A-129

regarding debt collection;

(c) 7 CFR part 1.1--USDA implementation of the Freedom of

Information Act;

(d) 7 CFR part 15, Subpart A--USDA implementation of Title VI of

the Civil Rights Act of 1964;

(e) 7 CFR part 3015--USDA Uniform Federal Assistance Regulations,

implementing OMB Directives (i.e., Circular Nos. A-110, A-21, and A-

122) and incorporating provisions of 31 U.S.C. 6301-6308 (formerly, the

Federal Grant and Cooperative Agreement Act of 1977, Public Law No. 95-

224), as well as general policy requirements applicable to recipients

of Departmental financial assistance;

(f) 7 CFR part 3016--USDA Uniform Administrative Requirements for

Grants and Cooperative Agreements to State and Local Governments;

(g) 7 CFR part 3017, as amended--USDA implementation of

Governmentwide Debarment and Suspension (nonprocurement) and

Governmentwide Requirements for Drug-Free Workplace (Grants);

(h) 7 CFR part 3018--USDA implementation of New Restrictions on

Lobbying. Imposes prohibitions and requirements for disclosure and

certification related to lobbying on recipients of Federal contracts,

grants, cooperative agreements, and loans;

(i) 29 U.S.C. 794, Section 504--Rehabilitation Act of 1973, and 7

CFR part 15B (USDA implementation of the statute), prohibiting

discrimination based upon physical or mental handicap in Federally

assisted programs; and

(j) 35 U.S.C. 200 et seq.--Bayh-Dole Act, controlling allocation of

rights to inventions made by employees of small business firms and

domestic nonprofit organizations, including universities, in Federally

assisted programs (implementing regulations are contained 37 CFR part

401).

Sec. 1943.127 Fund disbursement. -

The method of payment will be by reimbursement by Treasury check,

and payment will be requested on Standard Form (SF) 1034, ``Public

Voucher for Purchases and Services Other Than Personal,'' or SF-270,

``Request for Advance or Reimbursement,'' whichever is applicable.

Payments will be processed in accordance with 7 CFR parts 3015 and

3016.

Sec. 1943.128 Financial management systems and reporting requirements.

(a) Recipients must comply with standards for the financial

management and reporting and program performance reporting found in 7

CFR parts 3015 and 3016.

(b) Recipients must provide to the State Office quarterly financial

and program performance reports. The reports are due 30 days after the

reporting period, and an original and two copies of each report will be

submitted. The financial report will be presented on SF-269A,

``Financial Status Report,'' and the financial and program performance

reports will be prepared in accordance with 7 CFR parts 3015 and 3016.

(c) The program performance report should also address progress on

the activities under each of the areas of Outreach, Training, and

Technical Assistance, as stipulated in the cooperative agreement or

other agreement.

(d) Within 30 days after receipt, the State Office will forward the

reports to the National Office Project Manager, with the State Office's

comments and recommendations.

Secs. 1943.129-1943.135 [Reserved]

Sec. 1943.136 Standards of conduct for employees of recipient.

(a) Recipients must establish safeguards to prevent employees,

consultants, or members of governing bodies from using their positions

for purposes that are, or give the appearance of being, motivated by a

desire for private financial gain for themselves or others such as

those with whom they have family, business, or other ties. Therefore,

recipients receiving financial support must have written policy

guidelines on conflict of interest and the avoidance thereof. These

guidelines should reflect State and local laws and must cover financial

interests, gifts, gratuities and favors, nepotism, and other areas such

as political participation and bribery. These rules must also indicate

the conditions under which outside activities, relationships, or

financial interests are proper or improper, and provide for

notification of these kinds of activities, relationships, or financial

interests to a responsible and objective recipient official. For the

requirements of a code of conduct applicable to procurements under

grants and cooperative agreements, see the procurement standards

prescribed by 7 CFR 3015.181.

(b) The rules of conduct must contain a provision for prompt

notification of violations to a responsible and objective recipient

official and must specify the type of administrative action that may be

taken against an individual for violations.

(c) A copy of the rules of conduct must be given to each officer,

employee, board member, and consultant of the recipient who is working

on the CFSA financed project, and the rules must be enforced to the

extent permissible under State and local law or to the extent to which

the recipient determines it has legal and practical enforcement

capacity. The rules need not be formally submitted and approved by the

awarding official; however, they must be made available for review upon

request, for example, during a site visit.

Sec. 1943.137 Monitoring compliance and penalty for noncompliance.

(a) CFSA monitoring. CFSA will monitor compliance of the Small

Farmer Outreach Training and Technical Assistance projects through the

reports received in accordance with Sec. 1943.128 of this subpart,

through information received from field offices and the public, and may

include on-site visits to observe the operation and administration of

the program.

(b) Audits. Recipients are subject to the audit requirements of 7

CFR parts 3015 and 3016. An audit report will be submitted to the State

Office annually in accordance with OMB Circular A-128, A-110, or A-133,

whichever is applicable. The State Office will forward the audit to the

National Office Project Manager, within 30 days after receipt, with the

State Office's comments and recommendations.

(c) Penalty for noncompliance. If the Administrator determines that

a Small Farmer Outreach Training and Technical Assistance project does

not meet or no longer meets the objective of the program, that there

has been a violation of the cooperative or other agreement, that

reporting requirements are not being met, or that funds are not being

used only for the operation and administration of the Small Farmer

Outreach Training and Technical Assistance Program, the awarding

official is authorized to impose any penalties or sanctions established

in 7 CFR parts 3015 and 3016. Penalties may include withholding

payments, suspension of the cooperative agreement or other agreement,

or termination for cause. If a penalty for noncompliance is enforced,

the reason(s) will be stated in a letter to the recipient along with

appeal rights pursuant to subpart B of part 1900 of this chapter.

Sec. Sec. 1943.138-1943.140 [Reserved]

Sec. 1943.141 Nondiscrimination. -

The policies and regulations contained in subpart E of part 1901 of

this chapter apply to grants and other agreements made under this

subpart.

Sec. 1943.142 Environmental requirements.

The policies and regulations contained in subpart G of part 1940 of

this chapter apply to grants and other agreements made under this

subpart.

Sec. Sec. 1943.143-1943.150 [Reserved]

Dated: December 5, 1994.

Eugene Moos, ------

Under Secretary, Farm and Foreign Agricultural Services.

Dated: December 5, 1994.

Bob J. Nash,------

Under Secretary, Rural Economic and Community Development.

[FR Doc. 94-30999 Filed 12-23-94; 8:45 am]

BILLING CODE 3410-07-U