[Federal Register Volume 83, Number 226 (Friday, November 23, 2018)]
[Rules and Regulations]
[Pages 59269-59272]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2018-25523]



 ========================================================================
 Rules and Regulations
                                                 Federal Register
 ________________________________________________________________________
 
 This section of the FEDERAL REGISTER contains regulatory documents 
 having general applicability and legal effect, most of which are keyed 
 to and codified in the Code of Federal Regulations, which is published 
 under 50 titles pursuant to 44 U.S.C. 1510.
 
 The Code of Federal Regulations is sold by the Superintendent of Documents. 
 
 ========================================================================
 

  Federal Register / Vol. 83 , No. 226 / Friday, November 23, 2018 / 
Rules and Regulations  

[[Page 59269]]



DEPARTMENT OF AGRICULTURE

Rural Business-Cooperative Service

Rural Housing Service

Rural Utilities Service

Farm Service Agency

7 CFR Part 1970

RIN 0572-AC44


Rural Development Environmental Regulation for Rural 
Infrastructure Projects

AGENCY: Rural Business-Cooperative Service, Rural Housing Service, 
Rural Utilities Service, Farm Service Agency, USDA.

ACTION: Direct final rule.

-----------------------------------------------------------------------

SUMMARY: The United States Department of Agriculture (USDA) Rural 
Development (RD), comprised of the Rural Business-Cooperative Service 
(RBS), Rural Housing Service (RHS), and Rural Utilities Service (RUS), 
hereafter referred to as the Agency, is issuing a direct final rule to 
update the Agency's Environmental Policies and Procedures regulation (7 
CFR 1970) to allow the Agency Administrators limited flexibility to 
obligate federal funds for infrastructure projects prior to completion 
of the environmental review while ensuring full compliance with 
National Environmental Policy Act (NEPA) procedures prior to project 
construction and disbursement of any RD funding. This change will allow 
RD to more fully meet the Administration's goals to speed the 
initiation of infrastructure projects and encourage planned community 
economic development without additional cost to taxpayers or change to 
environmental review requirements.

DATES: This rule is effective January 7, 2019, without further action, 
unless the Agency receives significant adverse comments or, an intent 
to submit a significant adverse comment, by December 24, 2018. Written 
significant adverse comments or, an intent to submit a significant 
adverse comment, must be received by Rural Development or carry a 
postmark or equivalent no later than December 24, 2018. If significant 
adverse comments are received, the Agency will publish a timely Federal 
Register document withdrawing this rule. The Agency is publishing a 
proposed rule contemporaneously with this final rule.

ADDRESSES: Submit your comments on this rule by any of the following 
methods:
     Federal eRulemaking Portal: Go to http://www.regulations.gov and, in the lower ``Search Regulations and Federal 
Actions'' box, select ``Rural Utilities Service'' from the agency drop-
down menu, then click on ``Submit.'' In the Docket ID column, select 
RUS-18-AGENCY-0005 to submit or view public comments and to view 
supporting and related materials available electronically. Information 
on using Regulations.gov, including instructions for accessing 
documents, submitting comments, and viewing the docket after the close 
of the comment period, is available through the site's ``User Tips'' 
link.
     Postal Mail/Commercial Delivery: Please send your comment 
addressed to Michele Brooks, Rural Development Innovation Center, 
Regulations Team Lead, U.S. Department of Agriculture, 1400 
Independence Ave. SW, Stop 1522, Room 1562, Washington, DC 20250. 
Please state that your comment refers to Docket No. RUS-18-AGENCY-0005.
    Other Information: Additional information about Rural Development 
and its programs is available on the internet at https://www.usda.gov/topics/rural.

FOR FURTHER INFORMATION CONTACT: Kellie McGinness Kubena, Director, 
Engineering and Environmental Staff, Rural Utilities Service, USDA 
Rural Development, 1400 Independence Ave SW, Mail Stop 1571, Room 2242, 
Washington, DC 20250-1571 Phone: 202-720-1649.

SUPPLEMENTARY INFORMATION:

Executive Order 12866

    This final rule has been determined to be not significant for the 
purposes of Executive Order 12866, Regulatory Planning and Review, and 
therefore has not been reviewed by the Office of Management and Budget 
(OMB).

Executive Order 12988

    This final rule has been reviewed under Executive Order 12988, 
Civil Justice Reform. The Agency has determined that this rule meets 
the applicable standards provided in section 3 of the Executive Order. 
In addition, all state and local laws and regulations that are in 
conflict with this rule will be preempted. No retroactive effect will 
be given to this rule and, in accordance with section 212(e) of the 
Department of Agriculture Reorganization Act of 1994 (7 U.S.C. 
6912(e)), administrative appeal procedures must be exhausted before an 
action against the Department or its agencies may be initiated.

Executive Order 12372

    This final rule is not subject to the requirements of Executive 
Order 12372, ``Intergovernmental Review,'' as implemented under USDA's 
regulations at 2 CFR part 415, subpart C, because this rule provides 
general guidance on NEPA and related environmental reviews of 
applicants' proposals. Applications for Agency programs will be 
reviewed individually under Executive Order 12372 as required by 
program procedures.

Regulatory Flexibility Act Certification

    The Agency has determined that this final rule will not have a 
significant economic impact on a substantial number of small entities, 
as defined in the Regulatory Flexibility Act (5 U.S.C. Sec. Sec.  601 
et seq.), given that the amendment is only an administrative, 
procedural change on the government's part with respect to obligation 
of funds.

National Environmental Policy Act

    In this final rule, the Agency proposes to create limited 
flexibility for the timing of obligation of funds relative to the 
completion of environmental review. The Council on Environmental 
Quality (CEQ) does not direct agencies to prepare a NEPA analysis 
before establishing agency procedures that supplement the CEQ 
regulations for implementing NEPA. The requirements for establishing 
agency NEPA procedures are set forth at 40 CFR 1505.1 and 1507.3. The 
determination that establishing agency NEPA

[[Page 59270]]

procedures does not require NEPA analysis and documentation has been 
upheld in Heartwood, Inc. v. U.S. Forest Service, 73 F. Supp. 2d 962, 
972-73 (S.D. III. 1999), aff'd, 230 F.3d 947, 954- 55 (7th Cir. 2000).

Catalog of Federal Domestic Assistance

    The Catalog of Federal Domestic Assistance (CFDA) numbers assigned 
to the RD Programs affected by this rulemaking are as follows:

10.760--Water & Waste Disposal System Systems for Rural Communities.
10.761--Technical Assistance and Training Grants.
10.762--Solid Waste Management Grants.
10.763--Emergency Community Water Assistance Grants.
10.770--Water & Waste Disposal Loan and Grants (Section 306C).
10.766--Community Facilities Loans and Grants.
10.850--Rural Electrification Loans and Loan Guarantees.
10.851--Rural Telephone Loans and Loan Guarantees.
10.855--Distance Learning & Telemedicine Grants.
10.857--State Bulk Fuel Revolving Loan Fund.
10-858--Assistance to High Energy Cost-Rural Communities.
10.863--Community Connect Grants.
10.865--Biorefinery, Renewable Chemical, & Biobased Product 
Manufacturing Assistance Program.
10.866--Repowering Assistance Program.
10.867--Advanced Biofuel Payment Program.
10.868--Rural Energy for America Program.
10.886--Rural Broadband Access Loan and Loan Guarantee Program.

    All active CFDA programs can be found at www.cfda.gov. The Catalog 
is available on the internet at http://www.cfda.gov and the General 
Services Administration's (GSA's) free CFDA website at http://www.cfda.gov. The CFDA website also contains a PDF file version of the 
Catalog that, when printed, has the same layout as the printed document 
that the Government Publishing Office (GPO) provides. GPO prints and 
sells the CFDA to interested buyers. For information about purchasing 
the Catalog of Federal Domestic Assistance from GPO, call the 
Superintendent of Documents at 202-512-1800 or toll free at 866-512-
1800, or access GPO's online bookstore at http://bookstore.gpo.gov.
    Rural Development infrastructure programs not listed in this 
section nor on the CFDA website, but which are enacted pursuant to the 
Rural Electrification Act of 1936, 7 U.S.C. 901 et seq., the 
Consolidated Farm and Rural Development Act of 1972, 7 U.S.C. 1921 et 
seq., or any other Congressional act for Rural Development, will be 
covered by the requirements of this action when enacted.

Unfunded Mandates Reform Act

    This final rule contains no Federal mandates (under the regulatory 
provisions of Title II of the Unfunded Mandates Reform Act of 1995) for 
state, local, and tribal governments or the private sector. Therefore, 
this rule is not subject to the requirements of Sec. Sec.  202 and 205 
of the Unfunded Mandates Reform Act of 1995.

E-Government Act Compliance

    The Agency is committed to the E-Government Act, which requires 
Government agencies in general to provide the public the option of 
submitting information or transacting business electronically to the 
maximum extent possible.

Executive Order 13132, Federalism

    The policies contained in this final rule do not have any 
substantial direct effect on states, on the relationship between the 
national government and the states, or on the distribution of power and 
responsibilities among the various levels of government. Nor does this 
final rule impose substantial direct compliance costs on state and 
local governments. Therefore, consultation with the states is not 
required.

Executive Order 13175, Consultation and Coordination With Indian Tribal 
Governments

    This rule has been reviewed in accordance with the requirements of 
Executive Order 13175, ``Consultation and Coordination with Indian 
Tribal Governments.'' Executive Order 13175 requires Federal agencies 
to consult and coordinate with tribes on a government-to-government 
basis on policies that have tribal implications, including regulations, 
legislative comments or proposed legislation, and other policy 
statements or actions that have substantial direct effects on one or 
more Indian tribes, on the relationship between the Federal Government 
and Indian tribes or on the distribution of power and responsibilities 
between the Federal Government and Indian tribes. The latest revision 
of the Agency's Environmental Policies and Procedures in 2016 involved 
Tribal consultation via comment period and webinar as a baseline for 
future consultation on individual program actions. The creation of 
limited flexibility for the timing of obligation of funds relative to 
the completion of environmental review is only an administrative, 
procedural change on the government's part and in no way abridges or 
alters that agreement. Therefore, no further consultation is necessary 
on this rule change. The policies contained in this final rule do not 
have Tribal implications that preempt Tribal law. The Agency will 
continue to work directly with Tribes and Tribal applicants to improve 
access to Agency programs. This includes providing focused outreach to 
Tribes regarding implementation of this rule change. Additionally, the 
Agency will respond in a timely and meaningful manner to all Tribal 
government requests for consultation concerning this rule. For further 
information on the Agency's Tribal consultation efforts, please contact 
Rural Development's Native American Coordinator at (720) 544-2911 or 
[email protected].

USDA Non-Discrimination Policy

    In accordance with Federal civil rights law and U.S. Department of 
Agriculture (USDA) civil rights regulations and policies, the USDA, its 
Agencies, offices, and employees, and institutions participating in or 
administering USDA programs are prohibited from discriminating based on 
race, color, national origin, religion, sex, gender identity (including 
gender expression), sexual orientation, disability, age, marital 
status, family/parental status, income derived from a public assistance 
program, political beliefs, or reprisal or retaliation for prior civil 
rights activity, in any program or activity conducted or funded by USDA 
(not all bases apply to all programs). Remedies and complaint filing 
deadlines vary by program or incident.
    Persons with disabilities who require alternative means of 
communication for program information (e.g., Braille, large print, 
audiotape, American Sign Language, etc.) should contact the responsible 
Agency or USDA's TARGET Center at (202) 720-2600 (voice and TTY) or 
contact USDA through the Federal Relay Service at (800) 877-8339. 
Additionally, program information may be made available in languages 
other than English.
    To file a program discrimination complaint, complete the USDA 
Program Discrimination Complaint Form, AD-3027, found online at http://www.ascr.usda.gov/complaint_filing_cust.html and at any USDA office or 
write a letter addressed to USDA and provide in the letter all of the 
information requested in the form. To

[[Page 59271]]

request a copy of the complaint form, call (866) 632-9992. Submit your 
completed form or letter to USDA by: (1) Mail: U.S. Department of 
Agriculture, Office of the Assistant Secretary for Civil Rights, 1400 
Independence Avenue SW, Washington, DC 20250-9410; (2) fax: (202) 690-
7442; or (3) email: [email protected].
    USDA is an equal opportunity provider, employer, and lender.

Information Collection and Recordkeeping Requirements

    In accordance with the Paperwork Reduction Act, the paperwork 
burden associated with this final rule has been approved by the Office 
of Management and Budget (OMB) under the currently approved OMB Control 
Number 0575-0197. The Agency has determined that changes contained in 
this regulatory action do not substantially change current data 
collection that would require approval under the Paperwork Reduction 
Act of 1995 (44 U.S.C. Chapter 35).

Background

    The United States Department of Agriculture (USDA) Rural 
Development (RD) programs provide loans, grants and loan guarantees to 
support investment in rural infrastructure to spur rural economic 
development, create jobs, improve the quality of life, and address the 
health and safety needs of rural residents. Infrastructure investment 
is an important national policy priority. As directed by E.O. 13807 in 
2017, USDA as a member of the Federal Permitting Improvement Steering 
Council has reviewed its NEPA implementing regulations and policies to 
identify impediments to efficient and effective environmental reviews 
and authorizations for infrastructure projects. This final rule is part 
of that effort to improve the efficiency and effectiveness of RD's 
environmental reviews and authorizations for infrastructure projects in 
rural America.
    On April 25, 2017, the President created the Interagency Task Force 
on Agriculture and Rural Prosperity (Task Force) through E.O. 13790 and 
appointed the Secretary of Agriculture as the Task Force's Chair. Among 
the purposes and functions of the Task Force was to,

    ``. . . identify legislative, regulatory, and policy changes to 
promote in rural America agriculture, economic development, job 
growth, infrastructure improvements, technological innovation, 
energy security, and quality of life, including changes that remove 
barriers to economic prosperity and quality of life in rural 
America.''

The Task Force Report issued on October 21, 2017, included calls to 
action on achieving e-Connectivity for Rural America, improving rural 
quality of life, harnessing technological innovation and developing the 
rural economy.

Purpose of the Regulatory Action

    This rulemaking fulfills the mandate of E.O. 13807 as well as the 
goals of the President's Interagency Task Force on Agriculture and 
Rural Prosperity by identifying regulatory changes that promote 
economic development and improve the quality of life in rural America. 
The RD infrastructure projects impacted by this rule are often critical 
to the health and safety and quality of life in rural communities. In 
some cases, funding decisions made by Rural Development are the first 
step upon which a much larger process of community economic development 
depends. This amendment to existing regulation will allow the Agency to 
obligate funding conditioned upon the full and satisfactory completion 
of environmental review for infrastructure projects. This change will 
give applicants, and often the distressed communities they represent, 
some comfort to proceed with an economic development strategy, 
including the planning process associated with NEPA, without fear that 
funds may be rescinded before the NEPA process is completed. With this 
change in place, RD can more fully meet the government's goals of 
speeding up the initiation of infrastructure projects, encouraging 
planned community economic development, and leveraging investment 
without additional cost to taxpayers or any change in environmental 
review requirements. Infrastructure projects covered by this final rule 
include those, such as broadband, telecommunications, electric, energy 
efficiency, smart grid, water, sewer, transportation, and energy 
capital investments in physical plant and equipment.

Changes to the Current Regulation

    Nothing in this final rule reduces RD's obligation to complete the 
NEPA planning process prior to foreclosing reasonable alternatives to 
the federal action. The current regulation at 7 CFR 1970.6 (``Financial 
assistance'') states that the Agency defines the major decision point 
for completion of NEPA as the approval of financial assistance. 
Similarly, 7 CFR 1970.11(b) identifies Agency obligation as the point 
by which the environmental review must be concluded. As amended by this 
final rule, 7 CFR 1970.11(b) will now provide RD Administrators limited 
flexibility to obligate funds for infrastructure projects prior to the 
completion of the environmental review process where the assurance that 
funds will be available is important for community health, safety, or 
economic development. As a result, the environmental review process 
must be completed prior to disbursement of any RD funds, or any other 
action that would have adverse environmental impact or limit the choice 
of reasonable alternatives. The conditions of obligation will be 
defined in the documentation of the agreement approving the financial 
assistance between the Agency and the applicant. If, however, the 
conditions of obligation are not met, or the agency chooses not to 
proceed with the project after considering the results of the NEPA 
process, the Agency will rescind the obligated funds. With these 
conditions, the Agency retains control of the final decision to 
authorize construction and release funds based on the satisfactory 
completion of the environmental review. Note, this final rule will not, 
and does not, change any of the requirements for environmental reviews. 
Should an applicant choose to commence a project and thus foreclose 
reasonable alternatives, such action would result in de-obligation of 
federal funding, thereby eliminating any federal action for NEPA 
purposes on the part of Rural Development. Until the Agency concludes 
the environmental review and decides to proceed with the project, the 
obligated funds will be reserved for the infrastructure project and 
less susceptible to Congressional rescission.

List of Subjects in 7 CFR Part 1970

    Administrative practice and procedure, Buildings and facilities, 
Environmental impact statements, Environmental protection, Grant 
programs, Housing, Loan programs, Natural resources, Utilities.

    Accordingly, for reasons set forth in the preamble, chapter XVII, 
of subtitle B, title 7, Code of Federal Regulations is amended as 
follows:

PART 1970--ENVIRONMENTAL POLICIES AND PROCEDURES

0
1. The authority citation for part 1970 continues to read as follows:

    Authority: 7 U.S.C. 6941 et seq., 42 U.S.C. 4241 et seq.; 40 CFR 
parts 1500-1508; 5 U.S.C. 301; 7 U.S.C. 1989; and 42 U.S.C. 1480.


0
2. Revise Sec.  1970.11(b) to read as follow:

[[Page 59272]]

Sec.  1970.11  Timing of the environmental review process.

* * * * *
    (b) The environmental review process must be concluded before the 
obligation of funds; except for infrastructure projects where the 
assurance that funds will be available for community health, safety, or 
economic development has been determined as necessary by the Agency 
Administrator. At the discretion of the Agency Administrator, funds may 
be obligated contingent upon the conclusion of the environmental review 
process prior to any action that would have an adverse effect on the 
environment or limit the choices of any reasonable alternatives. Funds 
so obligated shall be rescinded if the Agency cannot conclude the 
environmental review process before the end of the fiscal year after 
the year in which the funds were obligated, or if the Agency determines 
that it cannot proceed with approval based on findings in the 
environmental review process. For the purposes of this section, 
infrastructure projects shall include projects such as broadband, 
telecommunications, electric, energy efficiency, smart grid, water, 
sewer, transportation, and energy capital investments in physical plant 
and equipment, but not investments authorized in the Housing Act of 
1949.
* * * * *

    Dated: November 9, 2018.
Anne C. Hazlett,
Assistant to the Secretary, Rural Development.
Bill Northey,
Under Secretary, Farm Production and Conservation.
[FR Doc. 2018-25523 Filed 11-21-18; 8:45 am]
BILLING CODE P