[Federal Register Volume 82, Number 98 (Tuesday, May 23, 2017)]
[Notices]
[Pages 23522-23525]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2017-10521]


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DEPARTMENT OF AGRICULTURE

Commodity Credit Corporation


Notice of Funds Availability (NOFA) for the Organic Certification 
Cost Share Program

AGENCY: Commodity Credit Corporation and Farm Service Agency, USDA.

ACTION: Notice.

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SUMMARY: The Farm Service Agency (FSA), on behalf of the Commodity 
Credit Corporation (CCC), is revising and clarifying its previous 
announcement of the availability of funding for fiscal years (FY) 2017 
and 2018 under the Organic Certification Cost Share Program (OCCSP).

DATES: Producer and Handler Applications: The dates for FSA county 
offices to accept applications for OCCSP payments from producers and 
handlers for FY 2017 started on March 27, 2017, and ends on October 31, 
2017, and for FY 2018, starts on October 1, 2017, and ends on October 
31, 2018.

FOR FURTHER INFORMATION CONTACT: Steve Peterson, (202) 720-7641.

SUPPLEMENTARY INFORMATION: 

Revision and Clarification

    On December 22, 2016, USDA published a NOFA for OCCSP (81 FR 93884-
93887). That NOFA announced that the purpose of OCCSP is to provide 
cost share assistance to producers and handlers of agricultural 
products in obtaining certification under the National Organic Program 
(NOP) established under the Organic Foods Production Act of 1990 (OFPA) 
(7 U.S.C. 6501-6524) and the regulations in 7 CFR part 205. FSA 
administers OCCSP.
    In the December NOFA, USDA announced that beginning in FY 2017, 
transitional certification and State organic program fees would be 
eligible for cost share reimbursement, and that for OCCSP purposes, 
they would be considered two additional, separate scopes. As stated in 
the NOFA, transitional certification is an optional certification 
offered by some certifiers for producers and handlers who are in the 
process of transitioning land to organic production.
    Upon review of OCCSP authority, FSA determined that it had 
erroneously announced the availability of cost-share for transitional 
certification, because no transitional certification programs are 
currently established under OFPA. Accordingly, this notice clarifies 
that cost-share assistance will not be available for transitional 
certification.
    Consistent with this clarification, this NOFA provides revised 
information about eligible scopes for the OCCSP, allowable and 
unallowable costs, eligibility requirements for producers and handlers, 
documentation to be provided in a producer or handler's application 
package, provisions for grant agreements with State agencies, and the 
definition of ``certified operation.''
    In addition, this NOFA provides the corrected date when the 
producer and applications were made available, which changed from the 
date announced in the December NOFA of March 20, 2017, to the actual 
start date of March 27, 2017, once the forms were approved for use.

Background

    The purpose of OCCSP is to provide cost share assistance to 
producers and handlers of agricultural products in obtaining 
certification under NOP established under the Organic Foods Production 
Act of 1990 (7 U.S.C. 6501-6524) and the regulations in 7 CFR part 205. 
The Agricultural Marketing Service (AMS) implemented OCCSP and has been 
running OCCSP through agreements with State agencies since FY 2008. 
USDA transferred authority to administer OCCSP from AMS to FSA 
beginning with FY 2017.
    FSA accepted applications from States interested in overseeing 
reimbursements to their producers and handlers. In addition, all 
producers and handlers will have access to OCCSP through their local 
FSA offices. In States where State agencies provide cost share funds, 
producers and handlers can choose between the State agencies or the 
local FSA office. In addition to expanding to FSA local offices for FY 
2017, OCCSP will now cover costs related to State organic program fees.
    In order for a State agency to receive new fund allocations for FY 
2017, it must establish a new agreement with FSA to administer OCCSP. 
FY 2017 agreements will include provisions allowing a State agency to 
request an extension of that new FY 2017 agreement to provide 
additional funds and allow the State agency to continue to administer 
OCCSP for FY 2018. FSA has not yet determined whether an additional 
application period will be announced for FY 2018 for State agencies 
that choose not to participate in FY 2017; State agencies that would 
like to administer OCCSP for FY 2018 are encouraged to establish an 
agreement for FY 2017 to ensure that they will be able to continue to 
participate. FSA does not anticipate substantive changes to the 
agreement process with the participating States. Agreements will 
continue to allow subgrants to other entities.
    Certified operations will be subject to the same eligibility 
criteria and calculation of cost share payments regardless of whether 
they apply for OCCSP through an FSA local office or a participating 
State agency. Certified operations may only receive OCCSP payment for 
the same scope for the same year from one source: Either the State 
agency or FSA. FSA will coordinate with participating State agencies to 
ensure there are no duplicate payments. If a duplicate payment is 
inadvertently made, then FSA will inform the

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participant and require that funds be returned to CCC.

Availability of Funds

    Funding for OCCSP is provided through two authorizations: National 
Organic Certification Cost Share Program (National OCCSP) funds and 
Agricultural Management Assistance (AMA) funds. Section 10004 of the 
Agricultural Act of 2014 (the 2014 Farm Bill, Pub. L. 113-79) amended 
section 10606(d) of the Farm Security and Rural Investment Act of 2002 
(7 U.S.C. 6523(d)), authorizing $11.5 million from CCC to be used for 
National OCCSP funds for each of FYs 2014 through 2018, to remain 
available until expended. National OCCSP funds will be used for cost 
share payments to certified operations in the 50 United States, the 
District of Columbia, the Commonwealth of Puerto Rico, Guam, American 
Samoa, the U.S. Virgin Islands, and the Commonwealth of the Northern 
Mariana Islands.
    The USDA organic regulations recognize four separate categories, or 
``scopes,'' that must be individually inspected for organic 
certification: Crops, livestock, wild crops, and handling (that is, 
processing). A single operation may be certified under multiple scopes. 
For example, a certified organic vegetable farm that also has certified 
organic chickens and produces certified organic jams would be required 
to be certified for three scopes: Crops, livestock, and handling. 
Beginning in FY 2017, State organic program fees will also be eligible 
for cost share reimbursement and for OCCSP purposes will be considered 
an additional separate scope. State organic program fees may be 
required by States that have established a State organic program 
according to 7 CFR 205.620-205.622, and are in addition to the costs of 
organic certification under the four scopes of USDA organic 
certification.
    National OCCSP funds can be used to provide cost share for all four 
scopes of USDA organic certification (that is, crops, wild crops, 
livestock, and handling) and the additional scope of State organic 
program fees.
    In addition to the National OCCSP funds, Section 1609 of the 2014 
Farm Bill made a minor technical correction to the AMA authorizing 
language codified at 7 U.S.C. 1524, but did not change the amount 
authorized, which is $1 million. The availability of the AMA funds for 
OCCSP is contingent upon appropriations; the AMA funds are available 
for FY 2017. AMA funds may be used only for cost share payments for 
organic certification for the three scopes of crops, wild crops, and 
livestock, and are specifically targeted to the following 16 States:
     Connecticut,
     Delaware,
     Hawaii,
     Maryland,
     Massachusetts,
     Maine,
     Nevada,
     New Hampshire,
     New Jersey,
     New York,
     Pennsylvania,
     Rhode Island,
     Utah,
     Vermont,
     West Virginia, and
     Wyoming.
    Sequestration will apply to the total amount of funding available 
for OCCSP for FYs 2017 and 2018, if required by law.

Cost Share Payments

    As required by law (7 U.S.C. 6523(b)), the cost share payments 
cannot exceed 75 percent of eligible costs incurred, up to a maximum of 
$750 for each producer or handler. FSA will calculate 75 percent of the 
allowable costs incurred by an eligible operation, not to exceed a 
maximum of $750 per certification scope. Cost share assistance will be 
provided for allowable costs paid by the eligible operation during the 
same FY for which the OCCSP payment is being requested. Cost share 
assistance will be provided on a first come, first served basis, until 
all available funds are obligated for each FY. Applications received 
after all funds are obligated will not be paid. Allowable costs 
include:
     Application fees;
     Inspection fees, including travel costs and per diem for 
organic inspectors;
     USDA organic certification costs, including fees necessary 
to access international markets with which AMS has equivalency 
agreements or arrangements;
     State organic program fees;
     User fees or sale assessments; and
     Postage.
    Unallowable costs include:
     Inspections due to violations of USDA organic regulations 
or violations of State organic program requirements;
     Costs related to non-USDA organic certifications;
     Costs associated with or incidental to transitional 
certification;
     Costs related to any other labeling program;
     Materials, supplies, and equipment;
     Late fees;
     Membership fees; and
     Consultant fees.

Eligible Producers and Handlers

    To be eligible for OCCSP payments, a producer or handler must both:
     Possess USDA organic certification at the time of 
application; and
     Have paid fees or expenses related to its initial 
certification or renewal of its certification from a certifying agent.
    Operations with suspended, revoked, or withdrawn certifications at 
the time of application are ineligible for cost share reimbursement. 
OCCSP is open to producers and handlers in the 50 United States, the 
District of Columbia, the Commonwealth of Puerto Rico, Guam, American 
Samoa, the U.S. Virgin Islands, and the Commonwealth of the Northern 
Mariana Islands.

How To Submit the Application

State Agencies

    State agencies must have an agreement in place to participate in 
OCCSP. State agencies with funds remaining from an agreement from a 
previous FY may continue to administer OCCSP with those funds under the 
terms of their existing agreement. In the previous NOFA, State agencies 
were notified that they must complete an Application for Federal 
Assistance (Standard Form 424), and enter into a grant agreement with 
FSA to receive new fund allocations to provide cost share assistance 
for FY 2017. FSA accepted applications from State agencies between 
January 3, 2017, and February 17, 2017. Pending fund availability, 
applications received after February 17, 2017, may be considered.
    State agencies that have submitted applications for FY 2017 do not 
need to resubmit their applications. All grant agreements between FSA 
and State agencies for FY 2017 will include revised terms and 
conditions consistent with the clarification in this NOFA that cost-
share assistance will not be made available for transitional 
certification.
    Agreements for FY 2017 will include provisions to allow 
modification of the agreement to also cover a period of performance for 
FY 2018. At this time, FSA has not determined whether an additional 
application period will be announced for FY 2018 for State agencies 
that do not establish an agreement to administer OCCSP for FY 2017.

Producers and Handlers

    Certified operations may apply for OCCSP payments through FSA local 
offices or through a State agency (or authorized subgrantee) if their 
State has established an agreement to administer OCCSP. For a producer 
or handler to apply for OCCSP through FSA, each

[[Page 23524]]

applicant must submit a complete application, either in person or by 
mail, to any FSA county office. Additional options for producers or 
handlers to submit their application may be available at https://www.fsa.usda.gov/programs-and-services/occsp. A complete application 
includes the following documentation:
     Form CCC-884--Organic Certification Cost Share Program, 
available online at https://www.fsa.usda.gov/programs-and-services/occsp or at any FSA county office;
     Proof of USDA organic certification;
     Itemized invoice showing expenses paid to a third-party 
certifying agency for certification services during the FY in which the 
application is submitted; and
     An AD-2047, if not previously provided.
    Producers or handlers may be required to provide additional 
documentation to FSA if necessary to verify eligibility or issue 
payment.
    FSA's application period began on March 27, 2017, for FY 2017 and 
will begin on October 1, 2017, for FY 2018. Both application periods 
end on October 31 of their respective years, or when there is no more 
available funding, whichever comes first.
    Participating State agencies will establish their own application 
process and deadlines for producers and handlers, as specified in their 
grant agreements, and eligible operations must submit an application 
package according to the instructions provided by the State agency. A 
list of participating States will be available at https://www.fsa.usda.gov/programs-and-services/occsp after their agreements 
with FSA to administer OCCSP are finalized.

Definitions

    For this NOFA, new or revised definitions include the following:
    ``State agency'' means the agency, commission, or department of a 
State government, the District of Columbia, the Commonwealth of Puerto 
Rico, Guam, American Samoa, the U.S. Virgin Islands, or the 
Commonwealth of the Northern Marian Islands, authorized by the State to 
administer OCCSP.
    ``USDA organic certification'' means a determination made by a 
certifying agent that a production or handling operation is in 
compliance with Organic Foods Production Act of 1990 (7 U.S.C. 6501-
6522) and the regulations in 7 CFR part 205, which is documented by a 
certificate of organic operation.
    The following definitions from the regulations of 7 CFR 205.2 also 
apply to this NOFA: ``certified operation,'' ``certifying agent,'' 
``crop,'' ``handler,'' ``inspection,'' ``inspector,'' ``labeling,'' 
``livestock,'' ``organic,'' ``organic production,'' ``processing,'' 
``producer,'' ``State certifying agent,'' ``State organic program,'' 
and ``wild crop.''

Participating State Agency Reporting Requirements

    Twice a year, each participating State agency must provide FSA with 
a Federal Financial Report (form SF-425) along with a spreadsheet of 
Operations Reimbursed, listing the producers and handlers receiving 
cost share payments within the reporting period. The semi-annual 
reports are due to FSA on May 30 and November 30 of each year. Once a 
year, each participating State agency will need to provide FSA with a 
narrative report to describe program activities and any sub-recipients. 
The annual reports are due to FSA on November 30 of each year.

Other Provisions

    Persons and legal entities who file an application with FSA have 
the right to an administrative review of any FSA adverse decision with 
respect to the application under the appeals procedures at 7 CFR parts 
780 and 11. FSA program requirements and determinations that are not in 
response to, or result from, an individual disputable set of facts in 
an individual participant's application for assistance are not matters 
that can be appealed.
    A producer or handler may file an application with an FSA county 
office after the OCCSP application deadline, and in such case the 
application will be considered a request to waive the deadline. The 
Deputy Administrator has the discretion and authority to consider the 
case and waive or modify application deadlines and other requirements 
or program provisions not specified in law, in cases where the Deputy 
Administrator determines it is equitable to do so and where the Deputy 
Administrator finds that the lateness or failure to meet such other 
requirements or program provisions do not adversely affect the 
operation of OCCSP. Although applicants have a right to a decision on 
whether they filed applications by the deadline or not, applicants have 
no right to a decision in response to a request to waive or modify 
deadlines or program provisions. The Deputy Administrator's refusal to 
exercise discretion to consider the request will not be considered an 
adverse decision and is, by itself, not appealable.
    Any person or legal entity who applies to a State agency is subject 
to review rights afforded by the State agency.
    Participating State agencies that are dissatisfied with any FSA 
decision relative to a State agency agreement may seek review for 
programs governed by Federal contracting laws and regulations.
    The regulations governing offsets and withholdings in 7 CFR part 
1403 apply to OCCSP payments. Any participant entitled to an OCCSP 
payment may assign such payment(s) in accordance with the regulations 
in 7 CFR part 1404.
    Awards to State agencies will be subject to 2 CFR part 200, Uniform 
Administrative Requirements, Cost Principles, and Audit Requirements 
for Federal Awards.

Paperwork Reduction Act Requirements

    The information collection request for OCCSP have been approved by 
the Office of Management and Budget (OMB) under the Paperwork Reduction 
Act. The OMB control number for the approval is 0560-0289. There were 
no public comments submitted for the information collection request.

Catalog of Federal Domestic Assistance

    The title and number of the Federal assistance program in the 
Catalog of Federal Domestic Assistance to which this NOFA applies is 
10.171, Organic Certification Cost share Program (OCCSP).

Environmental Review

    The environmental impacts of this NOFA have been considered in a 
manner consistent with the provisions of the National Environmental 
Policy Act (NEPA, 42 U.S.C. 4321-4347), the regulations of the Council 
on Environmental Quality (40 CFR parts 1500-1508), and the FSA 
regulations for compliance with NEPA (7 CFR part 799). As previously 
stated, since FY 2008 USDA implemented OCCSP through AMS via agreements 
with State agencies. To make OCCSP more accessible by using FSA county 
offices as a sign-up option for applicants, USDA shifted jurisdiction 
of OCCSP from AMS to FSA. FSA is now administering and coordinating 
OCCSP through agreements with interested States, and also now provides 
cost share payments directly to eligible producers and handlers for 
eligible expenses. The general scope of OCCSP, as implemented 
previously by AMS, is unchanged.
    The purpose of OCCSP is to provide cost share assistance to 
producers and handlers of agricultural products in obtaining USDA 
organic certification.

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FSA's jurisdiction over OCCSP and the minor, discretionary changes to 
OCCSP (that is, two options for payment receipt: From a State, or from 
FSA) are administrative in nature. The discretionary aspects of OCCSP 
(for example, program eligibility, calculation of cost share payments, 
etc.) were effectively designed by AMS and are not proposed to be 
substantively changed. As such, the Categorical Exclusions in 7 CFR 
part 799.31 apply, specifically 7 CFR 799.31(b)(6)(iii) (that is, 
financial assistance to supplement income). No Extraordinary 
Circumstances (7 CFR 799.33) exist. As such, FSA has determined that 
this NOFA does not constitute a major Federal action that would 
significantly affect the quality of the human environment, individually 
or cumulatively. Therefore, FSA will not prepare an environmental 
assessment or environmental impact statement for this regulatory 
action.

Chris P. Beyerhelm,
Acting Administrator, Farm Service Agency, and Acting Executive Vice 
President, Commodity Credit Corporation.
[FR Doc. 2017-10521 Filed 5-22-17; 8:45 am]
 BILLING CODE 3410-05-P