Notice of Funding Availability (NOFA) for Repowering Assistance Payments to Eligible Biorefineries, 28009-28016 [E9-13804]

Agencies

• DEPARTMENT OF AGRICULTURE
• Rural Business-Cooperative Service

[Federal Register Volume 74, Number 112 (Friday, June 12, 2009)]
[Notices]
[Pages 28009-28016]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E9-13804]


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DEPARTMENT OF AGRICULTURE

Rural Business-Cooperative Service


Notice of Funding Availability (NOFA) for Repowering Assistance 
Payments to Eligible Biorefineries

AGENCY: Rural Development-Energy Division, Program Branch, USDA.

ACTION: Notice.

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SUMMARY: This Notice announces the intention of the USDA (``the 
Agency'') to make payments to eligible biorefineries to encourage the 
use of renewable biomass as a replacement fuel source for fossil fuels 
used to provide process heat or power in the operation of these 
eligible biorefineries. This program is authorized under Title IX, 
Section 9001, of the Food, Conservation, and Energy Act of 2008 (Pub. 
L. 110-246).

DATES: Applications for participating in this program must be received 
between July 1, 2009 and November 1, 2009.
    The comment period for information collection under the Paperwork 
Reduction Act of 1995 continues through August 11, 2009. Comments on 
the paperwork burden must be received by this date to be assured of 
consideration.

ADDRESSES: Application materials may be obtained by contacting USDA, 
Rural Development-Energy Division, Program Branch, Attention: 
Repowering Assistance Program, 1400 Independence Avenue, SW., Stop 
3225, Washington, DC 20250-3225.

FOR FURTHER INFORMATION CONTACT: For further information on this 
payment program, please contact USDA, Rural Development-Energy 
Division, Program Branch, Attention: Repowering Assistance Program, 
1400 Independence Avenue, SW., Stop 3225, Washington, DC 20250-3225. 
Telephone: 202-720-1400.

SUPPLEMENTARY INFORMATION:
    On May 5, 2009, the President issued a Presidential Directive to 
Secretary of Agriculture Thomas R. Vilsack to aggressively accelerate 
the investment in and production of biofuels (published in the Federal 
Register on May 7, 2009 (74 FR 21531-21532)). Secretary Vilsack also 
announced that he will help lead an unprecedented interagency effort to 
increase America's energy independence and spur rural economic 
development.
    The Presidential directive requests that Secretary Vilsack take 
steps to the extent permitted by law to expedite and increase 
production of and investment in biofuel development efforts by, among 
other things, making renewable energy financing opportunities from the 
2008 Farm Bill available within 30 days, which includes guidance and 
support to encourage biorefinereies to replace the use of fossil fuels 
in plant operations by installing new biomass energy systems or 
producing new energy from renewable biomass.

Administrative Procedure Act Statement

    This NOFA is being issued without advance rulemaking or public 
comment. The Administrative Procedure Act (``APA'', 5 U.S.C. 553), has 
several exemptions to rulemaking requirements. Among them is an 
exemption for matters relating to federal benefits, but under the 
provisions of the ``Statement of Policy of the Secretary of Agriculture 
effective July 24, 1971,'' issued by Secretary Hardin in 1971 (36 FR 
13804 (the ``Hardin Memorandum''), the Department will normally engage 
in rulemaking related to federal benefits despite that exemption. 
However, the Hardin Memorandum does not waive certain other APA-
contained exemptions, in particular the ``good cause'' exemption found 
at 5 U.S.C. 553(b)(3)(B), which allows effective government action 
without rulemaking procedures where withholding the action would be 
``impracticable, unnecessary, or contrary to the public interest.'' The 
Hardin memorandum specifically provides for the use of the ``good 
cause'' exemption, albeit sparingly, when a substantial basis for so 
doing exists, and where, as will be described more fully below, that 
substantial basis is explained.
    USDA has determined, consistent with the APA and the Hardin

[[Page 28010]]

Memorandum, that making these funds available under this Notice for 
payments to biorefineries to assist in their conversion to the use of 
renewable energy sources as soon as possible is in the public interest. 
Withholding this NOFA to provide for public notice and comment would 
unduly delay the provision of benefits associated with this program and 
be contrary to the public interest. Should the actual practice of the 
program produce reasons for program modifications those modifications 
can be brought to the attention of the Department and changes made in 
the future rulemaking process.

Paperwork Reduction Act

    In accordance with the Paperwork Reduction Act of 1995, RBS is 
requesting comments from all interested individuals and organizations 
on a new information collection for the repowering assistance program. 
While this notice requests comments on the information collection 
activities required for the repowering assistance program, in order to 
meet the time frames mandated by the Presidential Memorandum discussed 
above, RBS submitted the following information collection request to 
the Office of Management and Budget (OMB) under the emergency procedure 
in accordance with the Paperwork Reduction Act of 1995. As discussed 
above in the APA section, there is good cause to forgo any delay 
associated with the opportunity for advance public comment. The 
repowering assistance program will provide payments for the conversion 
of biorefineries to use renewable energy as a power source.
    Copies of all forms, regulations, and instructions referenced in 
this NOFA may be obtained from RBS. Data furnished by the applicants 
will be used to determine eligibility for program benefits. Furnishing 
the data is voluntary; however, the failure to provide data could 
result in program benefits being withheld or denied.
    Title: Repowering Assistance Program.
    OMB Control Number: New collection.
    Type of Request: New.
    Abstract: This information collection is needed to comply with 
section 9004 of Title IX of the Farm Security and Rural Investment Act 
of 2002 (7 U.S.C. 8101-8113), which was added by the Food, 
Conservation, and Energy Act of 2008.
    Under this Notice, the Agency is providing payments to eligible 
biorefineries to support and encourage the use of renewable biomass to 
replace fossil fuels in the production of heat or power that fuel the 
energy requirements of these biorefineries. To meet the goals of this 
program, the Agency is requesting information from applicants including 
project costs, cost-effectiveness, the percentage of reduction in 
fossil fuel use that a biorefinery anticipates by transitioning to 
biofuel and evidence of applicant's qualifications.
    The collection of information is vital to the Agency to make 
decisions regarding the eligibility of biorefineries to participate in 
this program, in order to ensure compliance with the provisions of this 
Notice and to ensure that the payments are made to eligible 
biorefineries. In summary, the collection of information is necessary 
in order to implement this program.
    The following estimates are based on the average over the first 
three years the program is in place:
    Estimate of Burden: Public reporting burden for this collection of 
information is estimated to average 14.9 hours per response.
    Respondents: Liquid transportation biofuel producers.
    Estimated Number of Respondents: 18.
    Estimated Number of Responses per Respondent: 7.5.
    Estimated Number of Responses: 135.
    Estimated Total Annual Burden (hours) on Respondents: 2,017
    Copies of this information collection can be obtained from Cheryl 
Thompson, Regulations and Paperwork Management Branch, at (202) 692-
0043.

Comments

    Comments are invited regarding: (a) Whether the proposed collection 
of information is necessary for the proper performance of the functions 
of Rural Development, including whether the information will have 
practical utility; (b) the accuracy of Rural Development's estimate of 
the burden of the proposed collection of information including the 
validity of the methodology and assumptions used; (c) ways to enhance 
the quality, utility and clarity of the information to be collected; 
and (d) ways to minimize the burden of the collection of information on 
those who are to respond, including through the use of appropriate 
automated, electronic, mechanical, or other technological collection 
techniques or other forms of information technology. Comments may be 
sent to Cheryl Thompson, Regulations and Paperwork Management Branch, 
Support Services Division, USDA, Rural Development, Stop 0742, 1400 
Independence Ave., SW., Washington, DC 20250-0742. All responses to 
this Notice will be summarized and included in the request for OMB 
approval. All comments will also become a matter of public record.

Overview Information

    Federal Agency Name. Rural Business-Cooperative Service.
    Payment Proposal Title. Repowering Assistance Program.
    Announcement Type. Initial announcement.
    Contract Proposal Number. XX-XXX-X-XX; OMB approval number is XXXX-
XXXX.
    Catalog of Federal Domestic Assistance (CFDA) Number. The CFDA 
number for this Notice is 10.866.
    Dates. The Repowering Assistance Program application period for 
fiscal year 2009 is July 1 through November 1, 2009.
    Availability of Notice. This Notice is available on the USDA Rural 
Development Web site at https://www.rurdev.usda.gov/rbs/xxxxxxxxxxxxxxxx.

I. Funding Opportunity Description

    A. Purpose of the Program. The purpose of this program is to 
provide financial incentives to biorefineries in existence on June 18, 
2008, the date of the enactment of the Food, Conservation, and Energy 
Act of 2008 (the 2008 Farm Bill) (Pub. L. 110-246), to replace the use 
of fossil fuels used to produce heat or power at their facilities by 
installing new systems that use renewable biomass, or to produce new 
energy from renewable biomass.
    The Agency may make payments under this program to any biorefinery 
that meets the requirements of this Notice for a period of up to three 
years. The Agency will determine the amount of payments to be made to a 
biorefinery based on the quantity of fossil fuel a renewable biomass 
system is replacing, the percentage reduction in fossil fuel used by 
the biorefinery, and the cost-effectiveness of the renewable biomass 
system, economic benefit to the community, and the potential to improve 
the quality of life in rural America.
    The Agency will determine who receives payment under this program 
based on the percentage reduction in fossil fuel used by the 
biorefinery that will result from the installation of the renewable 
biomass system; the cost and cost-effectiveness of the renewable 
biomass system; and other selection criteria identified in Section V, 
Application Review Information. The above criteria will be used to 
determine priority for awards of $5 million or 50 percent of total 
eligible project costs, whichever is less. Based on our research

[[Page 28011]]

and survey of medium sized project costs, the Agency has determined 
that the dollar amount identified will provide adequate incentive for 
biorefineries to apply.
    B. Statutory Authority. This program is authorized under Title IX, 
Section 9001, of the Food, Conservation, and Energy Act of 2008 (Pub. 
L. 110-246).
    C. Definition of Terms. The following definitions are applicable to 
this Notice.
    Application period. The time period announced by the Agency in this 
or subsequent Notices during which the Agency will accept applications.
    Base energy use. The amount of documented fossil fuel energy use 
over an extended operating period.
    (i) The extended operating period must be at least 24 months of 
recorded usage, and requires metered utility records for electric 
energy, natural gas consumption, fuel oil, coal shipments and propane 
use, as applicable for providing heat or power for the operation of the 
biorefinery.
    (ii) Utility billing, oil and coal shipments must be actual bills, 
with meter readings, applicable rates and tariffs, costs and usage. 
Billing must be complete, without gaps and arranged in chronological 
order. Drop shipments of coal or oil can be substituted for metered 
readings, provided the biorefinery documents the usage and its 
relationship to providing heat or power to the biorefinery.
    (iii) A biorefinery in existence on or before June 18, 2008 with 
less than 24 months of actual operating data must provide at least 12 
months of data supported by engineering and design calculations, and 
site plans, prepared by the construction engineering firm.
    Biobased products. Is a product determined by the Secretary to be a 
commercial or industrial product (other than food or feed) that is: (a) 
Composed, in whole or in significant part, of biological products, 
including renewable domestic agricultural materials and forestry 
materials; or (b) an intermediate ingredient or feedstock.
    Biofuel. Fuel derived from renewable biomass.
    Biorefinery. A facility (including equipment and processes) that 
converts renewable biomass into biofuels and biobased products, and may 
produce electricity.
    Eligible biorefinery. A producer, whose primary production is 
liquid transportation biofuels, that meets all requirements of this 
program. The biorefinery must have been in existence on or before June 
18, 2008.
    Eligible renewable biomass. Renewable biomass as defined in this 
Notice.
    Energy Information Agency (EIA). The statistical agency of the 
Department of Energy and source of official energy statistics from the 
U.S. Government.
    Feasibility study. An Agency-acceptable analysis of the economic, 
environmental, technical, financial, and management capabilities of a 
proposed project or business in terms of its expected success. See 
Section III G(9) of this notice for a list of items included in a 
feasibility study.
    Feedstock unit. Bushel, hundredweight, pound, or other unit of 
measure, as applicable, for the renewable biomass feedstock used in 
liquid transportation biofuel production.
    Financial Interest. For the purposes of this notice means any 
ownership, creditor, or management interest in the biorefinery.
    Fiscal year. The 12-month period beginning each October 1 and 
ending September 30 of the following calendar year.
    Fossil fuel. Fuels derived from coal, oil and natural gas.
    Renewable biomass.
    (i) Materials, pre-commercial thinnings, or invasive species from 
National Forest System land and public lands (as defined in section 103 
of the Federal Land Policy and Management Act of 1976 (43 U.S.C. 1702)) 
that:
    (A) Are byproducts of preventive treatments that are removed to 
reduce hazardous fuels; to reduce or contain disease or insect 
infestation; or to restore ecosystem health; and
    (B) Would not otherwise be used for higher value products; and
    (C) Are harvested in accordance with applicable law and land 
management plans and the requirements for old growth maintenance, 
restoration, and management direction as per paragraphs (e)(2), (e)(3), 
and (e)(4), and large tree retention as per paragraph (f), of section 
102 of the Healthy Forests Restoration Act of 2003 (16 U.S.C. 6512); or
    (ii) Any organic matter that is available on a renewable or 
recurring basis from non-Federal land or land belonging to an Indian or 
Indian tribe that is held in trust by the United States or subject to a 
restriction against alienation imposed by the United States, including:
    (A) Renewable plant material, including feed grains; other 
agricultural commodities; other plants and trees; and algae; and
    (B) Waste material, including crop residue; other vegetative waste 
material (including wood waste and wood residues); animal waste and 
byproducts (including fats, oils, greases, and manure); and food waste 
and yard waste.
    Rural or rural area. Any area of a State not in a city or town that 
has a population of more than 50,000 inhabitants, according to the 
latest decennial census of the United States, and the contiguous and 
adjacent urbanized area, and any area that has been determined to be 
``rural in character'' by the Under Secretary for Rural Development, or 
as otherwise identified in this definition. In determining which census 
blocks in an urbanized area are not in a rural area, the Agency will 
exclude any cluster of census blocks that would otherwise be considered 
not in a Rural Area only because the cluster is adjacent to not more 
than two census blocks that are otherwise considered not in a rural 
area under this definition.
    (i) For the purposes of this definition, cities and towns are 
incorporated population centers with definite boundaries, local self 
government, and legal powers set forth in a charter granted by the 
State.
    (ii) For the Commonwealth of Puerto Rico, the island is considered 
rural and eligible for Business Programs assistance, except for the San 
Juan Census Designated Place (CDP) and any other CDP with greater than 
50,000 inhabitants. CDPs with greater than 50,000 inhabitants, other 
than the San Juan CDP, may be determined to be eligible if they are 
``not urban in character.'' Any such requests must be forwarded to the 
National Office, Business and Industry Division, with supporting 
documentation as to why the area is ``not urban in character'' for 
review, analysis, and decision by the Administrator, Business and 
Cooperative Programs.
    (iii) For the State of Hawaii, all areas within the State are 
considered rural and eligible for Business Programs assistance, except 
for the Honolulu CDP within the County of Honolulu.
    (iv) For the purpose of defining a rural area in the Republic of 
Palau, the Federated States of Micronesia, and the Republic of the 
Marshall Islands, the Agency shall determine what constitutes rural and 
rural area based on available population data.
    (v) The determination that an area is ``rural in character'' under 
this definition will be to areas that are within:
    (A) An urbanized area that has two points on its boundary that are 
at least 40 miles apart, which is not contiguous or adjacent to a city 
or town that has a population of greater than 150,000 inhabitants or 
the urbanized area of such a city town; or

[[Page 28012]]

    (B) An urbanized area contiguous and adjacent to a city or town of 
greater than 50,000 population that is within one-quarter mile of a 
rural area.

II. Funding Information

    A. Available Funds. Congress has appropriated mandatory funding for 
this program in the amount up to $20 million for FY 2009, to remain 
available until expended.
    B. Number of Payments. The number of payments made will vary and be 
based on the number of applicants selected for award and availability 
of funds.
    C. Range of Amounts of Each Payment. The amount of each payment 
will depend on the number of eligible applicants selected for award in 
the program, the amount of fossil fuel replaced, the cost effectiveness 
of the system, and the percentage reduction in fossil fuel use.
    D. Payment Limitations. For the purposes of this program, the 
maximum payment an applicant may receive will be 50 percent of total 
eligible project costs or $5 million, whichever is less. Based on our 
research and survey of medium sized project costs, the Agency has 
determined that the dollar amount identified will provide adequate 
incentive for biorefineries to apply.
    E. Type of Instrument. Payment Agreement.

III. Eligibility Information

    This Notice contains eligibility requirements for applicants 
seeking payments under this program.
    A. Applicant Eligibility. To be eligible for this program, the 
applicant must be an eligible biorefinery, defined in this Notice as a 
biorefinery in existence on or before June 18, 2008. Additionally, 
applicants must meet the citizenship requirement specified in paragraph 
(1) or (2), as applicable, of this section.
    (1) If the applicant is an individual, the applicant must be a 
citizen or national of the United States (U.S.), the Republic of Palau, 
the Federated States of Micronesia, the Republic of the Marshall 
Islands, or American Samoa, or must reside in the U.S. after legal 
admittance for permanent residence.
    (2) If the applicant is an entity other than an individual, the 
applicant must be at least 51 percent owned by persons who are either 
citizens or nationals of the United States (U.S.), the Republic of 
Palau, the Federated States of Micronesia, the Republic of the Marshall 
Islands, or American Samoa, or legally admitted permanent residents 
residing in the U.S.
    (3) The Agency will determine an applicant's eligibility for 
participation in this program.
    B. Rural Area Requirement. To be eligible for program payments, 
biorefinery must be located in a rural area.
    C. Payment Eligibility. To be eligible for program payments, an 
applicant must submit a complete application for consideration of 
payment. Payments will be made based on ranking of applicants in 
relation to project cost, cost-effectiveness, the quantity of fossil 
fuels the renewable biomass system is replacing, the reduction of 
fossil fuel usage resulting from the installation of a renewable 
biomass system.
    (D) Ranking of Applications. All scored applications will be ranked 
by the Agency as soon after the application deadline as possible. The 
Agency will consider the score an application has received compared to 
the scores of other applications in the priority list, with higher 
scoring applications receiving first consideration for payments.
    (E) Selection of Applications for Payments. Using the ranking 
created under Section V, Application Review Information, the Agency 
will select applications for payments. The Agency will notify, in 
writing, all applicants whose applications have been selected for 
payments. Applicants whose applications have not been selected for 
payments will be notified in writing, with a brief explanation as to 
why.
    (F) Availability of funds. If, after the majority of applications 
have been considered, insufficient funds remain to pay the next highest 
scoring application, the Agency may elect to pay a lower scoring 
application. Before this occurs, the Administrator, as applicable, will 
provide the applicant of the higher scoring application the opportunity 
to reduce the amount of its payment request to the amount of funds 
available. If the applicant agrees to lower its payment request, it 
must certify that the purposes of the project can be met, and the 
Administrator must determine the project is feasible at the lower 
amount.
    G. Application Package Contents. Applicants are required to provide 
relevant data to allow for technical analysis of their existing 
facilities to demonstrate replacement of fossil fuel by renewable 
biomass with reasonable costs and maximum efficiencies. Applicants in 
existence on or before June 18, 2008 with more than 24 months of actual 
operating data must provide data for the most recent 24-month period. 
Applicants in existence on or before June 18, 2008 with less than 24 
months of actual operating data must provide 12 months of data 
supported by engineering and design calculations, and site plans, 
prepared by the construction engineering firm.
    All applicants must submit the following information as part of 
their application package:
    (1) Contact Data. Contact information for the primary technical 
contact for the biorefinery.
    (2) Biorefinery Data. Basic information on facility operations over 
time (hours/day, days/year).
    (3) Electric Use Data. Information on existing electric service to 
the facility, data on consumption, peak and average demand, and 
monthly/seasonal use patterns.
    (4) Fuel Use Data. Information on natural gas and current fuel use 
for boilers and heaters, including fuel type, costs, and use patterns.
    (5) Thermal Loads. Information on existing thermal loads, including 
type (steam, hot water, direct heat), conditions (temperature, 
pressure) and use patterns.
    (6) Existing Equipment. Information on existing heating and cooling 
equipment, including type, capacities, efficiencies and emissions.
    (7) Site-Specific Data. Information on other site-specific issues, 
such as expansion plans or neighborhood considerations that might 
impact the proposed new system design or operation; or environmental 
impacts.
    (8) Biofuel production. Information on liquid biofuel production 
(gallons/year).
    (9) Feasibility Study. The applicant must submit a feasibility 
study by an independent qualified consultant, which has no financial 
interest in the biorefinery, and demonstrates that the renewable 
biomass system of the biorefinery is feasible, taking into account the 
economic, technical and environmental aspects of the system. The study 
must include the following:
    (i) Executive summary, including resume of the consultant.
    (A) Introduction/project overview (brief general overview of 
project location, size, etc.)
    (ii) Economic feasibility determination.
    (A) Information regarding project site.
    (B) Availability of trained or trainable labor.
    (C) Availability of infrastructure and rail and road service to the 
site.
    (iii) Technical feasibility determination.
    (A) Report must be based upon verifiable data and contain 
sufficient information and analysis so that a determination may be made 
on the technical feasibility of achieving the levels of energy 
production that are projected in the statements.

[[Page 28013]]

    (B) Report must also identify and estimate project operation and 
development costs and specify the level of accuracy of these estimates 
and the assumptions on which these estimates have been based. The 
project engineer or architect is considered an independent party 
provided neither any principal of the firm nor any individual of the 
firm who participates in the technical feasibility report has a 
financial interest in the project.
    (iv) Financial feasibility determination.
    (A) Reliability of the financial projections and assumptions on 
which the project is based including all sources of project capital, 
both private and public, such as Federal funds.
    (B) Projected balance sheets and costs associated with project 
operations.
    (C) Cash flow projections for the life of the project.
    (D) Adequacy of raw materials and supplies.
    (E) Sensitivity analysis, including feedstock and energy costs, 
product/co-product prices.
    (F) Risks related to the project.
    (G) Continuity, maintenance and availability of other records and 
adequacy of management.
    (v) Management feasibility determination.
    (vi) Recommendations for implementation.
    (vii) Environmental aspects of the system.
    (viii) Feedstock:
    (A) Feedstock source management.
    (B) Estimates of feedstock volumes and costs.
    (C) Collection, pre-treatment, transportation, and storage.
    (D) Impacts on existing manufacturing plants or other facilities 
that use similar feedstock.
    (ix) Feasibility/plans of project to work with producer 
associations or cooperatives including estimated amount of annual 
feedstock.
    H. Eligible Project Costs. Eligible project costs will be only for 
construction costs for repowering improvements associated with the 
equipment, installation, engineering, design, site plans, associated 
professional fees, permits and financing fees.
    I. Ineligible Project Costs. Any project costs not directly 
associated with the repowering project and system incurred by the 
applicant prior to application for payment assistance under this 
program will be ineligible for payment assistance. A project is not 
eligible under this notice if it is using feedstocks for repowering 
that are feedgrains that received benefits under Title I of the Food, 
Conservation, and Energy Act of 2008.

IV. Application and Submission Information

    A. Address to Make Application. Application must be made to USDA, 
Rural Development-Energy Division, Program Branch, Attention: 
Repowering Assistance Program, 1400 Independence Avenue, SW., Stop 
3225, Washington, DC 20250-3225.
    B. Content and Form of Submission. Applicants must submit a signed 
original and one copy of an application containing all the information 
required in this section. The applicant must also furnish the Agency 
the required documentation identified in the following forms to verify 
compliance with program provisions before acceptance into the program:
     Form RD 9004-1, Part C; and
     Form RD 9004-2, Part H; and
     Form RD 9004-3, Part E.
    Note that applicants are required to have a Dun and Bradstreet 
Universal Numbering System (DUNS) number (unless the applicant is an 
individual). The DUNS number is a nine-digit identification number, 
which uniquely identifies business entities. A DUNS number can be 
obtained at no cost via a toll-free request line at 1-866-705-5711, or 
online at https://fedgov.dnb.com/webform. In addition to the previously 
referenced feasibility study, applicants must submit to the Agency the 
following:
    (1) Form RD 9004-1, ``Repowering Assistance Program Application''. 
Applicants must submit this form and all necessary attachments 
providing project information on the biorefinery; the facility at which 
the biorefinery operates, including location and products produced; and 
the types and quantities of renewable biomass feedstock being proposed 
to produce heat or power. This form requires the applicant to provide 
relevant data to allow for technical analysis of their existing 
facility to demonstrate replacement of fossil fuel by renewable biomass 
with reasonable costs and maximum efficiencies. Applicant must also 
submit evidence that the biorefinery was in existence on or before June 
18, 2008. The applicant is required to certify the information 
provided.
    (2) Form RD 9004-2, ``Repowering Assistance Program Agreement''.
    (3) RD Instruction 1940-Q, Exhibit A-1, ``Restriction on Lobbying 
(if over $100,000)''.
    (4) Form RD 400-1, ``Equal Opportunity Agreement''.
    (5) Form RD 400-4, ``Assurance Agreement''.
    (6) Form RD 1940-20, ``Request for Environmental Information''.
    (7) Certifications. The applicant must furnish the Agency all 
required certifications before acceptance into the program, and furnish 
access to records required by the Agency to verify compliance with 
program provisions. Applicant must submit forms or other written 
documentation certifying to the following:
    (i) AD-1047, ``Certification Regarding Debarment, Suspension, and 
Other Responsibility Matters--Primary Covered Transactions'' or other 
written documentation.
    (ii) AD-1048, ``Certification Regarding Debarment, Suspension, 
Ineligibility and Voluntary Exclusion--Lower Tier Covered 
Transactions'' or other written documentation.
    (8) SF-LLL, ``Disclosure of Lobbying Activities''.
    C. Submission Dates and Times. For FY 2009, the application period 
is July 1, 2009 through November 1, 2009.
    D. Multiple Submissions. Only one application from corporations and 
entities with more than one biorefinery location will be eligible under 
this Notice. A project that serves multiple biorefineries located at 
the same location is an eligible project provided the heat and power 
are centrally produced.

V. Application Review Information

    The Agency is evaluating projects based on the cost, cost-
effectiveness, and capacity of projects to reduce fossil fuels. The 
cost of the project is taken into consideration in the context of each 
project's ability to economically produce energy from renewable biomass 
to replace its dependence on fossil fuels. Projects with higher costs 
that are less efficient will not score well. The scoring criteria are 
designed to evaluate projects on simple payback as well as the 
percentage of fossil fuel reduction.
    Submission of an application neither reserves payments nor ensures 
payments. The Agency will evaluate each application and make a 
determination as to whether the applicant is eligible, whether the 
proposed project is eligible, and whether the proposed payment request 
complies with all applicable statutes and regulations. This evaluation 
will be based on the information provided by the applicant and on other 
sources of information, such as recognized industry experts from the 
Agricultural Research Service and the Forest Service. The Agency will 
score each application in order to prioritize each proposed project. 
The maximum number of points awardable to any applicant will be 100.

[[Page 28014]]

The evaluation criteria that the Agency will use to score these 
projects are as follows.
    A. Cost. Payment will not exceed 50 percent of the total eligible 
project costs associated with the project or $5 million, whichever is 
less. Points will be awarded to applicants based on their ability to 
demonstrate the availability of sufficient other funding to complete 
the project. The applicant must provide evidence, satisfactory to the 
Agency, showing they have sufficient funds or commitment of funds to 
complete the project, including applicant financial statements or 
lender commitment letters. A maximum of 10 points will be awarded as 
follows:
    (1) Applicant demonstrates availability of all funding needed to 
complete the project, award 10 points.
    (2) Applicant does not demonstrate the availability of all the 
funding needed to complete the project, no points will be awarded.
    B. Cost-Effectiveness. Cost-effectiveness will be scored based on 
the anticipated return on investment (ROI). Anticipated ROI will be 
demonstrated by calculating documented base energy use costs for the 
24-month period prior to submission of the application or must provide 
at least 12 months of data supported by engineering and design 
calculations, and site plans, prepared by the construction engineering 
firm.
    (1) ROI is equal to the simple payback period.
     ROI = C/S; where C = capital expenses; and S = savings in 
annual operating costs.
     Example: Capital expenses, including handling equipment, 
biomass boiler, piping improvements and plant modifications, are equal 
to $5,300,500. The annual difference in fossil fuel cost versus the 
cost for renewable biomass is $990,500. Assume these costs and uses are 
based on a yearly operating cycle, which may include handling, storage 
and treatment costs. In this example, C = $5,300,500; S = $990,500; ROI 
= 5.35 years (C/S = ROI).
    (2) A maximum of 30 points will be awarded as follows:
    (i) If the anticipated ROI is less than or equal to four years, up 
to award 30 points.
    (ii) If the anticipated ROI is greater than four years but less 
than or equal to six years, award up to 10 points.
    (iii) If the anticipated ROI will be greater than six years, award 
0 points.
    C. Percentage of Reduction of Fossil Fuel Use. The anticipated 
percent of reduction in the use of fossil fuels will be measured using 
the same evidence provided by the applicant for measuring cost-
effectiveness. However, this set of criteria will measure actual fossil 
fuel use for the 24-month period prior to submission of the application 
or for at least 12 months of data supported by engineering and design 
calculations, and site plans, prepared by the construction engineering 
firm.

    Note:  Fossil fuel use in terms of electric usage will be 
evaluated by using generating information provided by the Energy 
Information Agency (EIA). Not all electric generated power 
originates from fossil fuels, based on the definition in Section I 
of this notice. The Agency will determine the percentage reduction 
of fossil use based on and in cooperation with the applicant's 
submission of electric power provider contracts, power agreements, 
and utility billings in relation to available information from the 
EIA.

    A maximum of 25 points will be awarded as follows:
    (1) Applicant demonstrates an anticipated reduction in fossil fuel 
use of 100 percent, award 25 points.
    (2) Applicant demonstrates an anticipated reduction in fossil fuel 
use of at least 80 percent but less than 100 percent, award 20 points.
    (3) Applicant demonstrates an anticipated reduction in fossil fuel 
use of at least 60 percent but less than 80 percent, award 15 points.
    (4) Applicant demonstrates an anticipated reduction in fossil fuel 
use of at least 40 percent but less than 60 percent, award 10 points.
    (5) Applicant demonstrates an anticipated reduction in fossil fuel 
use of at least 30 percent but less than 40 percent, award 5 points.
    (6) Applicant demonstrates an anticipated reduction in fossil fuel 
use of less than 30 percent, award 0 points.
    D. Renewable Biomass Factors. Applicants must demonstrate the 
availability of the project-specific renewable biomass for the project. 
If the biorefinery has a commitment or contract for biomass feedstocks 
a maximum of 10 points will be awarded as follows:
    (1) Applicant demonstrates acceptable evidence of 100 percent 
biomass availability, award 10 points.
    (2) Applicant demonstrates acceptable evidence of 50 percent or 
greater biomass availability, award 5 points.
    (3) Applicant is unable to demonstrate acceptable evidence of 
biomass availability, award 0 points.
    E. Technical Review Factors. Technical reviews will be conducted by 
a team of experts, including rural energy coordinators and state 
engineers. The Agency may engage the services of other government 
agencies or other recognized industry experts in the applicable 
technology field, at its discretion, to evaluate and rate the 
application. Each section of the technical review will be scored within 
a range of possible points available within that section. A maximum of 
25 points will be awarded as follows:
    (1) Qualifications of the Applicant's Project Team. The applicant 
must describe its qualifications in terms of those individuals who will 
be essential to successful performance of the proposed project. This 
will include information regarding professional credentials, relevant 
experience, and education, and must be supported with documentation of 
service capabilities, professional credentials, licenses, 
certifications, and resumes, as applicable. Award 0-5 points.
    (2) Agreements and Permits. The applicant must describe the 
agreements and permits necessary for project implementation. An Agency-
acceptable schedule for securing the required documents and permits 
must be provided. Award 0-3 points.
    (3) Design and Engineering. The applicant has described the design, 
engineering, and testing needed for the proposed project. This 
description supports that the system will be designed, engineered, and 
tested so as to meet its intended purpose, ensure public safety, and 
comply with all applicable laws, regulations, agreements, permits, 
codes, and standards. Award 0-5 points.
    (4) Project Development Schedule. The applicant has provided a 
detailed plan for project development including a proposed schedule of 
activities, a description of each significant task, its beginning and 
end, and its relationship to the time needed to initiate and carry the 
project through to successful completion. This description must address 
the applicant's project development cash flow requirements. Award 0-3 
points.
    (5) Equipment Procurement. The applicant must describe the 
equipment needed, and the availability of the equipment needed, to 
complete installation and activation of the new system. The description 
supports that the required equipment is available, and can be procured 
and delivered within the proposed project development schedule. Award 
0-3 points.
    (6) Equipment Installation. The applicant has provided a 
satisfactory description of the plan for site development and system 
installation that reflects the soundness of the project plan. Award 0-3 
points.
    (7) Operations and Maintenance. The applicant has described the 
operations and maintenance requirements of the system necessary for the 
system to

[[Page 28015]]

operate as designed and provide the savings and efficiencies as 
described. The description and requirements noted must be supportable 
by the technical review. Award 0-3 points.

VI. Program Payment Provisions

    Applicants must agree to the terms and conditions of the payment 
program's provisions. This section of the Notice identifies the process 
and procedures the Agency will use to make payments to eligible 
biorefineries.
    A. Payment Applications. To request payments under this program 
during a FY, an eligible biorefinery must:
    (1) Submit Form RD 9004-3, ``Repowering Assistance Program-Payment 
Request''.
    (i) Upon completion of the project or project improvements, the 
first payment will be paid at the rate not to exceed 20 percent of the 
project award. Subsequent semiannual payments will be paid based on 
actual measured renewable biomass energy production at a rate of 50 
cents per million British thermal units (MMBTUs), up to the limit of 
the award.
    (ii) After processing an initial payment, additional payments may 
be processed semiannually with the submission of Form RD 9004-3. This 
form must be accompanied by measurement and verification records 
including metered data demonstrating displacement of fossil fuel use 
from the conversion to renewable biomass. Payment will be at the rate 
of 50 cents per MMBTU up to and until the project payment limit has 
been reached.
    (2) Certify that the request is accurate.
    (3) Furnish the Agency such certifications and access to records 
that verify compliance with program provisions.
    (4) Provide documentation, as requested by the Agency, regarding 
the production of usable energy at the biorefinery during the relevant 
payment period. Approved documentation for payment and verification of 
energy production from renewable biomass must include the following:
    (i) Metered data documenting the production of heat, gas and power 
must be obtained utilizing an Agency approved measurement device.
    (ii) Metered data must be verifiable and subject to independent 
calibration testing.
    (iii) Applicant must present payment request for energy production 
in units of MMBTU and request payment based on verifiable and 
documented data.
    (iv) Applicant must present receipts for drop shipments of and use 
of renewable biomass as applicable for the corresponding period in 
which they are requesting payments. Applicant must also present the 
current utility billing data from the same utilities used in the base 
energy use period for the corresponding payment request period.
    B. Additional Documentation. After semiannual payment applications 
are submitted, eligible biorefineries may be required to submit 
additional supporting clarification if their original submittal is not 
sufficient to verify eligibility for payment.
    C. Notification. The Agency will notify the biorefinery, in 
writing, whenever the Agency determines that a payment application is 
ineligible and why the application was determined ineligible.
    D. Payment Provisions. After the initial payment, payments to 
eligible applicants will be made based on energy produced as measured 
in output MMBTUs.
    E. Payment Amounts. An eligible biorefinery may receive a payment 
in an amount as determined according to the procedures specified in 
this section, subject to the availability of funds. The Agency will 
determine total available funds.
    F. Verification. The Agency reserves the right to verify all 
payment requests and subsequent payments made under this program, 
including field visits, as frequently as necessary to ensure the 
integrity of the program. Documentation provided will be used to 
verify, reconcile, and enforce the payment terms of the agreement along 
with any potential refunds that the recipient will be required to make 
should they fail to adequately document their request. The required 
documentation is given in RD form 9004-3, the Repowering Program 
Payment Request, which details and provides that the requester 
demonstrate a reduction in fossil fuel use by providing concurrent 
readings from their previously metered usage, along with the readings 
from the metered, measured, and verifiable production of renewable 
energy from renewable biomass.
    G. Payment adjustments. The Agency may make adjustments to payments 
otherwise payable to the biorefinery if it finds there is a difference 
between the quantity of fossil fuel actually replaced by renewable 
biomass and the quantity certified to in a payment application.
    H. Refunds and Interest Payments. An eligible biorefinery that has 
received a payment under this program may be required to refund such 
payment as specified in this paragraph.
    (1) An eligible biorefinery receiving payment under this program 
will become ineligible if the Agency determines the producer has:
    (i) Made any material fraudulent representation; or
    (ii) Misrepresented any material fact affecting a program 
determination.
    (2) All payments made to a biorefinery determined by the Agency to 
be ineligible must be refunded to the Agency with interest and other 
such sums as may become due, including, but not limited to, any 
interest, penalties, and administrative costs, as determined 
appropriate under 31 CFR 901.9.
    (3) When a refund is due, it must be paid promptly. If a refund is 
not made promptly, the Agency may use all remedies available to it, 
including Treasury offset under the Debt Collection Improvement Act of 
1996, financial judgment against the producer, and sharing information 
with the Department of Justice.
    (4) Late payment interest will be assessed on each refund in 
accordance with provisions and rates as determined by the Agency.
    (i) Interest charged by the Agency under this program will be at 
the rate established annually by the Secretary of the U.S. Treasury 
pursuant to 31 U.S.C. 3717. Interest will accrue from the date payments 
were received by the biorefinery to the date of repayment, or the date 
of an interest increase, as determined in accordance with applicable 
regulations.
    (ii) The Agency may waive the accrual of interest and/or damages if 
the Agency determines that the cause of the erroneous determination was 
not due to any action of the biorefinery.
    (5) Any biorefinery or person receiving payment under this program 
will be jointly and severally liable for any refund or related charges 
due under this program.

VII. Administration Information

    A. Notice of Eligibility. If an applicant is determined by the 
Agency to be eligible for participation, the Agency will notify the 
applicant, in writing, and will assign the applicant an agreement 
number. If an applicant is determined by the Agency to be ineligible, 
the Agency will notify the applicant, in writing, as to the reason(s) 
the applicant was rejected. Such applicants will have appeal rights as 
specified in this Notice.
    B. Conditions for Receipt of Payment. A signed copy of Form RD 
9004-2, ``Repowering Assistance Program- Agreement'', will be required 
for payment.
    C. Administrative and National Policy Requirements. In the event 
that all program funds are not expended in 2010 and/or discretionary 
money becomes available, then the Agency will proceed with a rulemaking 
process.

[[Page 28016]]

    (1) Review or appeal rights. Any person or entity who has applied 
for payments or whose right to receive payments under this program who 
is adversely affected by a decision by the Agency may appeal such 
decision to the USDA National Appeals Division pursuant to 7 CFR Part 
11.
    (2) Remedies. The remedies provided in this Notice will be in 
addition to other civil, criminal, or administrative remedies that may 
apply.
    (3) Records. For the purpose of verifying compliance with the 
requirements of this Notice, each biorefinery must make available and 
provide for the metering of all power and heat producing boilers, 
containment vessels, generators and any other equipment related to the 
production of heat or power required to displace fossil fuel loads with 
renewable biomass. These records must be held in one place and be 
available at all reasonable times for examination by the Agency. Such 
records include all books, papers, contracts, scale tickets, settlement 
sheets, invoices, written price quotations, and any other documents 
related to the program that are within the control of the biorefinery. 
These records must be held and made available for Agency examination 
for a period of not less than three years from each payment date.
    (4) Succession and control of facilities and production. Any party 
obtaining a biorefinery that is under this program must request 
permission to participate in this program as a successor. The Agency 
may grant such request if it is determined that, the party is eligible, 
and permitting such succession would serve the purposes of the program. 
If appropriate, the Agency may require the consent of the previous 
party to such succession. Also, the Agency may terminate payments and 
demand full refund of payments made if a party loses control of a 
biorefinery whose production of heat or power from renewable biomass is 
the basis of a program payment, or otherwise fails to retain the 
ability to assure that all program obligations and requirements will be 
met.
    D. Environmental Review. All recipients under this subpart are 
subject to the requirements of 7 CFR Part 1940, subpart G.
    E. Civil Rights Requirements. The Agency will comply with the civil 
rights law and compliance requirements in accordance with 7 CFR Part 
1901-E. This program is subject to Executive Order 12898, Environmental 
Justice, and RD Instruction 2006-P.

VIII. Agency Contacts

    Notice Contact. For further information about this Notice, please 
contact USDA, Rural Development-Energy Division, Program Branch, 
Attention: Frederick Petok, Stop 3225, Room 6870, 1400 Independence 
Avenue, SW., Washington, DC 20250-3225. Telephone: (202) 690-0784.
    Technical Assistance. For technical assistance on this payment 
program, please contact the USDA, Rural Development-Energy Division, 
Attention: Repowering Assistance Program, 1400 Independence Avenue, 
SW., Stop 3225, Washington, DC 20250-3225. Telephone: (202) 720-1400.

IX. Non-Discrimination Statement

    USDA prohibits discrimination in all its programs and activities on 
the basis of race, color, national origin, age, disability and, where 
applicable, sex, marital status, familial status, parental status, 
religion, sexual orientation, genetic information, political beliefs, 
reprisal, or because all or part of an individual's income is derived 
from any public assistance programs. (Not all prohibited bases apply to 
all programs.) Persons with disabilities who require alternative means 
for communication of program information (Braille, large print, 
audiotape, etc.) should contact USDA's TARGET Center at (202) 720-2600 
(voice and TTY). To file a complaint of discrimination, write to USDA, 
Director, Office of Civil Rights, Room 326-W, Whitten Building, 1400 
Independence Avenue, SW., Washington, DC 20250-9410, or call (800) 795-
3272 (voice) or (202) 720-5964 (voice and TDD). USDA is an equal 
opportunity provider and employer.

    Dated: June 8, 2009.
Judith A. Canales,
Administrator, Rural Development, Business and Cooperative Programs.
[FR Doc. E9-13804 Filed 6-11-09; 8:45 am]
BILLING CODE;P