[Federal Register Volume 68, Number 56 (Monday, March 24, 2003)]
[Rules and Regulations]
[Pages 14131-14134]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 03-6668]


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DEPARTMENT OF AGRICULTURE

Natural Resources Conservation Service

7 CFR Part 652


Technical Service Provider Assistance

AGENCY: Natural Resources Conservation Service, USDA.

ACTION: Interim final rule with request for comments.

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SUMMARY: This rulemaking amends the technical service provider 
assistance rule, 7 CFR part 652, published in the Federal Register on 
November 21, 2002, by setting forth the United States Department of 
Agriculture (Department) process for establishing payment rates for 
program participant acquisition of technical services. In addition, 
this rulemaking sets forth the Department's policy regarding 
subcontracting by technical service providers in the course of their 
delivery of technical services and amends 7 CFR part 652 accordingly. 
Finally the Department is using the opportunity presented by this 
rulemaking to clarify its policy regarding the certification process, 
to amend the definition of technical service provider in 7 CFR 652.21, 
and to amend the dates for submitting an Application for Certification 
in 7 CFR 652.21(f) and (d). The Natural Resources Conservation Service 
(NRCS) seeks comments from the public on this interim final rule.

DATES: Effective date: March 24, 2003. Comments on this rule must be 
received by June 23, 2003.

ADDRESSES: Send comments by mail to Melissa Hammond, Technical Service 
Provider Coordinator, Natural Resources Conservation Service, P.O. Box 
2890, Washington, DC 20013, or by e-mail to: [email protected], 
Attention: Technical Service Provider Assistance. This interim final 
rule may also be accessed via the Internet through the NRCS Home Page 
at http://www.nrcs.usda.gov, by selecting Farm Bill 2002.

FOR FURTHER INFORMATION CONTACT: Melissa Hammond, Technical Service 
Provider Coordinator, Strategic Natural Resource Issues Staff, NRCS, 
P.O. Box 2890, Washington, DC 20013-2890; telephone: (202) 720-6731; 
fax: (202) 720-3052; submit e-mail to: [email protected], Attention: 
Technical Service Provider Assistance.

SUPPLEMENTARY INFORMATION:

Discussion

Payment Rates

    As indicated in the preamble section of the technical service 
provider interim final rule, 7 CFR part 652, the Department is 
publishing this interim final rule, which amends the technical service 
provider rule, in order to set forth the Department's method of setting 
payment rates for technical service provider reimbursement. 
Accordingly, this rulemaking adds a new paragraph (j) to section 652.5 
of the existing technical service provider rule, and adds a new 
paragraph (h) to section 652.4, which addresses the use of 
subcontractors. This rulemaking also clarifies the Department's policy 
regarding the certification process set forth in the interim final rule 
at 7 CFR part 652.21.
    The Department will determine payment rates by setting not-to-
exceed rates for technical services. The Department may use some of the 
methods set forth in the preamble of the interim final rule, 7 CFR part 
652, when calculating these rates, including conducting a national 
survey of technical service providers and vendors who provide technical 
services to determine their price data for actual services performed 
and using NRCS's own cost of providing technical services. In addition, 
when determining not-to-exceed rates, NRCS may use other sources of 
data that it determines are reliable, including its own cost of 
procuring technical services. The Department chose this method to set 
the technical service not-to-exceed rates because it provides direct 
input from the marketplace.
    For at least the first year of implementation of the technical 
service provider process, one of the methods NRCS will use to obtain 
cost data is directly from technical service providers through the 
existing Internet-based posting system called FedBizOpps. Through a 
notice on the NRCS Web site, and using existing agency mailing lists, 
the Department will be requesting providers to respond to a 
solicitation posted at the FedBizOpps Web site, http://www.fedbizopps.gov/, for cost data related to specific categories of 
technical services and specific geographic areas. The Department 
anticipates that it will post this solicitation by March 1, 2003. Any 
price data collected from technical service providers and vendors with 
the national survey is for informational purposes only to assist the 
Department in establishing payment rates for technical services. 
Submission of price data by the provider does not obligate the 
Department, nor does it guarantee the provider the award of a specific 
contract by any program participant or the Department for carrying out 
technical services.
    NRCS will analyze the pricing information submitted through 
FedBizOpps, and that obtained from other sources, using a standardized 
methodology. Not-to-exceed payment rates will be established nationally 
on a State by State basis for categories of technical services. To 
ensure consistency across State lines, NRCS will coordinate payment 
rates between adjacent States where similar resource conditions and 
agricultural operations exist, taking into account differences in State 
laws, the cost of doing business, competition, and other variables. 
NRCS may subsequently adjust the rates, as needed on a case by case 
basis, during program implementation in response to unusual conditions 
or unforeseen circumstances, such as services provided for highly 
complex technical situations, emergency conditions, serious threats to 
human health or the environment, or major resource limitations. In 
these cases, NRCS will set a case-specific not-to-exceed payment rate. 
The Department will review the Technical Service Provider system, 
including the certification, payment, and technical service quality 
evaluation processes, by March 1, 2004.
    In order to encourage participants to consider price in their 
selection of technical service providers, NRCS may provide program 
participants, who select technical service providers with prices below 
the not-to-exceed rate,

[[Page 14132]]

with a credit of 50 percent of the technical service savings to apply 
toward their cost of practice installation. Specifically, the program 
participant would receive 50 percent of the cost savings of the 
difference between the not-to-exceed rate and the actual billing for 
the technical services provided. For example, if the not-to-exceed rate 
for technical services for a conservation practice is $10,000, and the 
participant chooses a provider whose service costs $9,000, the 
participant has earned a $500 credit toward the cost of practice 
installation. Assuming the participant's application has been selected 
for funding, the practice to be installed cost $20,000, and the cost 
share requirement is 50 percent, then the participant's cost share of 
the practice would be $9,500. Using this incentive system, both the 
participant and the Federal government enjoy a net savings, and the end 
result is a more efficient and cost-effective process.
    Under no circumstances may the earning of credits by a participant 
result in the Department exceeding any statutory limitation on cost-
sharing or payments for a particular program. Additionally, the earning 
of credits has no bearing on whether an application for financial 
assistance (installation of conservation practices) is selected. 
Consequently, the credit system will not result in a violation of any 
statutory prohibition against ``bidding down,'' (i.e., using cost as 
the deciding factor when choosing among applications that are expected 
to yield comparable environmental benefits).
    NRCS believes that this dynamic approach to setting not-to-exceed 
payment rates and providing incentives to program participants to 
choose competitively priced services will help ensure that its payment 
rates do not lag behind the development of technological efficiencies 
that decrease the time and cost associated with the delivery of 
technical services.
    NRCS is interested in receiving comments on any aspect of payment 
rates included in this rulemaking amendment or any other items 
regarding payment rates.

Use of Subcontractors By Technical Service Providers

    Technical service providers may not always have the expertise 
needed to carry out all aspects of delivering technical services for 
conservation practices or for conservation planning. Therefore, in 
order to make efficient use of the marketplace, technical service 
providers contracted to carry out technical services may use the 
services of subcontractors who are certified by NRCS for the specific 
technical services or expertise needed. The contracted technical 
service provider remains responsible for the overall technical services 
provided. In addition, subcontracted technical service providers are 
responsible for providing services in accordance with the terms of 
their Certification Agreement. Technical service providers will not be 
reimbursed if they subcontract with entities that are not certified 
providers for the particular technical services which they are 
providing.

National Certification

    The Department is using the opportunity presented by this 
rulemaking to clarify its policy regarding the certification process 
set forth in the interim final rule at 7 CFR part 652. The technical 
service provider certification process is a national certification 
process with uniform criteria and requirements; see 7 CFR part 652.21. 
Applicants can apply for certification to the Chief, NRCS, through the 
agency's TechReg Web site using one application, and listing each State 
for which the applicant wishes to be considered for certification. 
Applicants must meet the certification criteria for each category of 
technical services in which they desire certification.
    Applicants are required to self-certify that they meet all 
applicable State licensing or similar requirements for those technical 
services where certification is sought for each State. Applicants for 
certification must demonstrate, through documentation of training or 
experience, familiarity with NRCS guidelines, criteria, standards, and 
specifications as set forth in the applicable NRCS manuals, handbooks, 
field office technical guides, and supplements thereto, for planning 
and applying specific conservation practices and management systems for 
which certification is sought. In addition to National and State NRCS 
guidelines and criteria, applicants must also be familiar with any 
unique criteria required at the county level for particular practices 
before providing services in a particular county. By signing a 
Certification Agreement, applicants are acknowledging that they are 
aware of these local criteria, and agree to familiarize themselves with 
any such criteria by contacting the appropriate NRCS State official 
before providing technical services. In order to be considered for 
certification, the applicant must submit a completed Certification 
Application to NRCS electronically through the TechReg Web site. The 
Department encourages applicants and certified technical service 
providers to participate in NRCS sponsored trainings at the State and 
local level in order to gain familiarity with NRCS local criteria and 
guidelines, as well as to stay current on new developments in agency 
policy related to the provision of technical services.
    NRCS is amending the definition of technical service provider to 
reflect national certification. NRCS is also revising the dates from 
March 1, 2003, to June 1, 2003, for submitting an application regarding 
conditional certifications in section 652.21(f) and (g).

Request for Comments

    NRCS is extending the comment period for the Technical Service 
Provider Assistance Interim Final Rule published on November 21, 2002, 
Vol. 67, No. 225, for 30 days. Comments must be received by the date 
indicated at the beginning of this amendment. Comments on this 
amendment must be received within 90 days after publication in the 
Federal Register in accordance with the date indicated at the beginning 
of this amendment.
    NRCS is interested in receiving additional feedback from the public 
on the following issues.
    Whether governing board members of a public agency should or should 
not be engaged as private consultant technical service providers or as 
technical service providers under the auspices of that public agency.
    Whether or not there should be a maximum number of uncertified 
employees serving under the direction of a certified individual within 
a private-sector entity, or a public agency where that certified 
individual warrants the work of those uncertified employees and what 
that maximum number should be.

Regulatory Certifications

Executive Order 12866

    Pursuant to Executive Order 12866 (58 FR 51735, October 4, 1993), 
it has been determined that this interim final rule is a significant 
regulatory action, and has been reviewed by the Office of Management 
and Budget (OMB). Pursuant to section 6(a)(3) of Executive Order 12866, 
NRCS conducted an economic analysis of the potential impacts associated 
with the interim final rule for Technical Service Provider Assistance 
published in the Federal Register on November 21, 2002, and included 
the analysis as part of a Regulatory Impact Analysis document prepared 
for that interim final rule. The provisions of this interim final rule 
do not alter the analysis that was originally

[[Page 14133]]

prepared. A copy of the analysis is available upon request from Gary 
Gross, Resource Conservationist, Natural Resources Conservation 
Service, P.O. Box 2890, Washington, DC 20013-2890; or by e-mail to 
[email protected], Attention: Technical Service Provider Assistance--
Economic Analysis; or at the following Web address: http://www.nrcs.usda.gov.

Executive Order 12988

    This interim final rule has been reviewed in accordance with 
Executive Order 12988. The provisions of this interim final rule are 
not retroactive. The U.S. Department of Agriculture (USDA) has not 
identified any State or local laws that are in conflict with this 
regulation, or that would impede full implementation of this rule. In 
the event that such conflict is identified, the provisions of this 
interim final rule preempt State and local laws to the extent that such 
laws are inconsistent with this rule.

Regulatory Flexibility Act

    The Regulatory Flexibility Act is not applicable to this rule 
because the Secretary of Agriculture is not required by 5 U.S.C. 553 or 
any other provision of law to publish a notice of proposed rulemaking 
with respect to the subject matter of this rule.

National Environmental Policy Act

    The regulations promulgated by this rule do not authorize any 
action that may negatively affect the human environment. Accordingly, 
an analysis of impacts under the National Environmental Policy Act, 42 
U.S.C. 4321 et seq., has not been performed. This interim final rule 
will help implement new and existing USDA conservation programs, which 
are subject to the environmental analyses pursuant to the National 
Environmental Policy Act.

Paperwork Reduction Act

    Section 2702 of the Farm Security and Rural Investment Act of 2002 
requires that the promulgation of regulations and the administration of 
title II of said Act, which authorizes the use of certified technical 
service providers, be carried out without regard to chapter 35 of title 
44 of the United States Code (commonly known as the Paperwork Reduction 
Act). Accordingly, these regulations, related forms, and other 
information collection activities needed to establish payment rates 
under these regulations, are not subject to review by the Office of 
Management and Budget under the Paperwork Reduction Act.
    NRCS is committed to compliance with the Government Paperwork 
Elimination Act (GPEA) and the Freedom to E-File Act, which require 
government agencies, in general, to provide the public with the option 
of submitting information or transacting business electronically to the 
maximum extent possible, and to NRCS in particular. The forms and other 
information collection activities required for participation in 
technical services delivery under the technical service provider 
assistance rule, amended by this rule, are not fully implemented for 
the public to conduct business with NRCS electronically. However, the 
required standard forms discussed in this rule will be available 
electronically through the USDA eForms Web site, at 
www.sc.egov.usda.gov, for downloading. The regulation will be available 
at the NRCS home page at www.nrcs.usda.gov.

Unfunded Mandates Reform Act of 1995

    Pursuant to title II of the Unfunded Mandates Reform Act of 1995, 
Pub. L. 104-4, NRCS assessed the effects of this rulemaking action on 
State, local, and tribal governments, and the public. This action does 
not compel the expenditure of $100 million or more by any State, local, 
or tribal governments, or anyone in the private sector; therefore, a 
statement under section 202 of the Unfunded Mandates Reform Act of 1995 
is not required.

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

    Pursuant to section 304 of the Department of Agriculture 
Reorganization Act of 1994, Pub. L. 104-354, USDA classified this 
interim final rule as not major.

Civil Rights Impact Analysis

    A Civil Rights Impact Analysis was completed for the interim final 
rule for Technical Service Provider Assistance published in the Federal 
Register on November 21, 2002. The provisions of this interim final 
rule do not alter analysis that was originally prepared. The review 
revealed no factors indicating any disproportionate adverse civil 
rights impacts for participants in NRCS programs and services who are 
minorities, women, or persons with disabilities. A copy of this 
analysis is available upon request from Gary Gross, Resource 
Conservationist, Natural Resources Conservation Service, P.O. Box 2890, 
Washington, DC 20013-2890; or by e-mail to [email protected], 
Attention: Technical Service Provider Assistance--Civil Rights Impact 
Analysis; or at the following Web address: http://www.nrcs.usda.gov.

List of Subjects in 7 CFR Part 652

    Natural Resources Conservation Service, Soil conservation, 
Technical assistance, Water resources.


    For the reasons stated in the preamble, the Natural Resources 
Conservation Service hereby amends title 7 of the Code of Federal 
Regulations as set forth below:
    Accordingly, title 7 of the Code of Federal Regulations part 652 is 
amended by adding a new paragraph.

PART 652--TECHNICAL SERVICE PROVIDERCC ASSISTANCE

    1. The authority citation for part 652 continues to read as 
follows:

    Authority: 16 U.S.C. 3842.


    2. Section 652.5 is amended by revising paragraph (d) and adding a 
new paragraph (j) to read as follows:


Sec.  652.5  Program participant acquisition of technical services.

* * * * *
    (d) To obtain payment for technical services, the program 
participant must submit to the Department an invoice, supporting 
documentation, and a request for payment. The Department may pay a 
program participant for technical services provided by a technical 
service provider hired by the program participant through a 
reimbursement payment made directly to the program participant; or upon 
receipt of an assignment of payment from the program participant, a 
payment made directly to the technical service provider.
* * * * *
    (j) Payment rates.
    (1) NRCS will establish payment rates by calculating not-to-exceed 
rates for technical services. NRCS will calculate not-to-exceed rates 
using price data that it may acquire through various sources that it 
deems reliable.
    (2) Establishing not-to-exceed payment rates.
    (i) NRCS will analyze the pricing information using a standardized 
methodology.
    (ii) Not-to-exceed payment rates will be established nationally on 
a State by State basis for categories of technical services.
    (iii) NRCS will coordinate payment rates between adjacent States to 
ensure consistency where similar resource conditions and agricultural 
operations exist. Payment rates may vary to some

[[Page 14134]]

degree between States due to differences in State laws, the cost of 
doing business, competition, and other variables.
    (iv) NRCS will review payment rates annually, or more frequently as 
needed, and adjust the rates based upon data from existing contracts, 
Federal cost rates, and other appropriate sources.
    (v) NRCS may adjust payment rates, as needed, on a case-by-case 
basis, in response to unusual conditions or unforeseen circumstances in 
delivering technical services such as highly complex technical 
situations, emergency conditions, serious threats to human health or 
the environment, or major resource limitations. In these cases, NRCS 
will set a case-specific not-to-exceed payment rate based on the 
Department's determination of the scope, magnitude, and timeliness of 
the technical services needed.
    (3) Cost share credits. In order to encourage competitive pricing, 
a program participant may earn credits toward their cost-share for 
practice installation under a program contract when a participant 
selects a technical service provider with prices below the not-to-
exceed rates for the provision of technical services. The credits 
earned will be equal to a percentage of the savings generated by the 
participant by choosing a lower cost technical service provider. 
However, in no cases may the application of cost share credits to a 
program contract result in the Department exceeding any statutory 
limitations on cost sharing or payments for a particular program.

    3. Section 652.1 is amended by revising the definition of technical 
service provider to read as follows:


Sec.  652.1  Definitions.

* * * * *
    Technical service provider means an individual, entity, or public 
agency certified by NRCS and placed on the approved list to provide 
technical services to program participants or to the Department.
    4. Section 652.4 is amended by adding a new paragraph (h) to read 
as follows:


Sec.  652.4  Technical service standards.

* * * * *
    (h) Technical service providers may utilize the services of 
subcontractors to provide specific technical services or expertise 
needed by the technical service provider, provided that the 
subcontractors are certified by NRCS in accordance with this part for 
the particular technical services to be provided and the technical 
services are provided in terms of their certification agreement. 
Payments will not be made for any technical services provided by 
uncertified subcontractors.

    5. In Sec.  652.21 paragraphs (f) and (g) are revised to read as 
follows:
* * * * *
    (f) An individual, private-sector entity, or public agency is 
conditionally certified provided they had entered into a contract, 
cooperative agreement, or contribution agreement with the Department 
prior to March 24, 2003 to provide technical services and they submit 
an Application for Certification by June 1, 2003. An individual, 
private-sector entity, or public agency with conditional certification 
status under this paragraph may continue to provide technical services 
in accordance with the terms and conditions of the above-described 
contract, cooperative agreement, or contribution agreement. Conditional 
certification shall expire either by the date NRCS and the individual, 
private-sector entity, or public agency enter into a Certification 
Agreement, as described in Sec.  652.22(c)(1) or September 30, 2003, 
whichever is earlier.
    (g) An individual is conditionally certified if the individual was 
certified under NRCS policy in effect prior to March 24, 2003, and 
submits an Application for Certification by June 1, 2003. An individual 
with conditional certification status under this paragraph may continue 
to provide technical services to the Department and to program 
participants in accordance with the above-described prior 
certification. Conditional certification shall expire either by the 
date NRCS and the individual enter into a Certification Agreement, as 
described in Sec.  652.22(c)(1) or September 30, 2003, whichever is 
earlier.

    Signed in Washington, DC on March 7, 2003.
Bruce I. Knight,
Chief, Natural Resources Conservation Service.
[FR Doc. 03-6668 Filed 3-21-03; 8:45 am]
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