[Federal Register Volume 87, Number 220 (Wednesday, November 16, 2022)]
[Notices]
[Pages 68669-68670]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2022-24937]


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DEPARTMENT OF AGRICULTURE

Natural Resources Conservation Service

[Docket No. NRCS-2022-0014]


Determination of the Primary Purpose of the New York Suffolk 
County Septic Improvement Program (SIP)

AGENCY: Natural Resources Conservation Service, USDA.

ACTION: Notice.

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SUMMARY: USDA is providing public notice that the Secretary of 
Agriculture has determined that cost share payments made by the New 
York Suffolk County SIP are primarily for the purpose of conserving 
soil and water resources or protecting and restoring the environment. 
The Natural Resources Conservation Service (NRCS) was assigned 
technical and administrative responsibility for reviewing the New York 
Suffolk County SIP and for making appropriate recommendations for the 
Secretary's determination of primary purpose. The Secretary's 
determination permits recipients of cost share payments to exclude such 
payments from gross income to the extent allowed by the Internal 
Revenue Service.

FOR FURTHER INFORMATION CONTACT: Ronnie Maurer; telephone (202) 720-
9733; or email: [email protected]. Persons with disabilities who 
require alternative means for communication should contact the USDA 
Target Center at (202) 720-2600 (voice and text telephone (TTY)) or 
dial 711 for Telecommunications Relay Service (both voice and text 
telephone users can initiate this call from any telephone).

SUPPLEMENTARY INFORMATION:

Background

    Under Section 126(a)(8) of the Internal Revenue Code of 1954, as 
amended (26 U.S.C. 126) gross income does not include the ``excludable 
portion'' of payments received under any program of a State, or a 
political subdivision of a State, under which payments are made to 
individuals primarily for the purpose of protecting or restoring the 
environment. In general, a cost share payment for selected conservation 
practices is exempt from Federal taxation if it meets three tests:
    (1) It was for a capital expense;
    (2) It does not substantially increase the operator's annual income 
from the property for which it is made; and
    (3) The Secretary of Agriculture certified that the payment was 
made primarily for conserving soil and water resources, protecting, or 
restoring the environment, improving forests, or providing habitat for 
wildlife.
    The Secretary of Agriculture evaluates a conservation program on 
the basis of criteria specified in 7 CFR part 14 and makes a ``primary 
purpose'' determination for the payments made under the conservation 
program. The objective of the determination made under part 14 is to 
provide maximum conservation, environmental, forestry improvement, and 
wildlife benefits to the general public from the operation of 
applicable programs. Final determinations are made on the basis of 
program, category of practices, or individual practices.
    NRCS was assigned technical and administrative responsibility for 
reviewing the New York Suffolk County SIP and for making appropriate

[[Page 68670]]

recommendations for the Secretary's determination of primary purpose.
    Following a primary purpose determination by the Secretary of 
Agriculture, the Secretary of the Treasury determines if the payments 
made under the conservation program substantially increases the annual 
income derived from the property benefited by the payments.

Environmental Review

    From this Federal action, approving tax deferral will not result in 
impacts to the environment, therefore, no further National 
Environmental Policy Act (NEPA) documentation will be prepared.

Determination

    As provided for by Section 126 of the Internal Revenue Code, the 
Secretary examined the authorizing legislation, regulations, and 
operating procedures regarding the New York Suffolk County SIP. In 
accordance with the criteria specified in 7 CFR part 14, the Secretary 
has determined the primary purpose of cost share payments made under 
the New York Suffolk County SIP is conserving soil and water resources 
or protecting and restoring the environment.
    A current residential property owner residing in any area of 
Suffolk County may apply for a SIP grant to design, purchase, or 
install an Innovative and Alternative Onsite Wastewater Treatment 
System (I/A OWTS). The I/A OWTS must be approved for use by the Suffolk 
County Department of Health. All residential property owners are 
eligible because nitrogen loading does not affect just the property on 
which it occurs, but instead affects the entire regional area. However, 
since there are properties in areas that are even more susceptible to 
damage, the Suffolk County Commissioner of Health Services may 
authorize preferential review of an application for a grant if the 
grant application is for a residence in an area specified by Health 
Services as environmentally sensitive.
    Rules were developed that allow for a priority order on the 
issuance of grants, based on the environmental sensitivity of the area 
(for example, groundwater travel time to surface water in the home's 
geographic area). Suffolk County executes a grant contract with the 
property owner, which is recorded, but Suffolk County directly pays the 
designer, installer, or manufacturer of the I/A OWTS from a list 
established by the County. The amount of the grant award is based on 
actual eligible costs, up to $20,000, with the property owner incurring 
any additional expenses for the design, purchase, and installation 
costs over the grant amount.
    A ``Record of Decision'' for the New York Suffolk County SIP to 
provide grants to homeowners to design, purchase, or install an I/A 
OWTS has been prepared and is available upon request from the Acting 
Director, Financial Assistance Programs Division, NRCS, 1400 
Independence Avenue SW, Room 4529 South Building, Washington, DC 20250.
    The Secretary's determination is in accordance with section 126 of 
the Internal Revenue Code, and permits recipients of cost share 
payments to exclude those payments from gross income to the extent 
allowed by the Internal Revenue Service.

USDA Non-Discrimination Policy

    In accordance with Federal civil rights law and U.S. Department of 
Agriculture (USDA) civil rights regulations and policies, 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 or 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 (for example, braille, large 
print, audiotape, American Sign Language, etc.) should contact the 
responsible Agency or USDA TARGET Center at (202) 720-2600 (voice and 
text telephone (TTY) or dial 711 for Telecommunications Relay Service 
(both voice and text telephone users can initiate this call from any 
telephone). 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 https://www.usda.gov/oascr/how-to-file-a-program-discrimination-complaint and 
at any USDA office or write a letter addressed to USDA and provide in 
the letter all the information requested in the form. To request a copy 
of the complaint form, call (866) 632-9992. Submit your completed form 
or letter to USDA by mail to: U.S. Department of Agriculture, Office of 
the Assistant Secretary for Civil Rights, 1400 Independence Avenue SW, 
Washington, DC 20250-9410 or email: [email protected].
    USDA is an equal opportunity provider, employer, and lender.

Terry Cosby,
Chief, Natural Resources Conservation Service.
[FR Doc. 2022-24937 Filed 11-15-22; 8:45 am]
BILLING CODE 3410-16-P