Appeal Procedures, 34186-34194 [2012-14098]

Agencies

• DEPARTMENT OF AGRICULTURE
• Natural Resources Conservation Service

[Federal Register Volume 77, Number 112 (Monday, June 11, 2012)]
[Rules and Regulations]
[Pages 34186-34194]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2012-14098]


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DEPARTMENT OF AGRICULTURE

Natural Resources Conservation Service

7 CFR Part 614

[Docket No. NRCS-2011-0017]
RIN 0578-AA59


Appeal Procedures

AGENCY: Natural Resources Conservation Service.

ACTION: Final rule.

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SUMMARY: The Natural Resources Conservation Service (NRCS), United 
States Department of Agriculture (USDA) issues this final rule amending 
NRCS' informal appeal procedures as required by Title II of the Federal 
Crop Insurance Reform and Department of Agriculture Reorganization Act 
of 1994 (the 1994 Act). This final rule amends regulations promulgated 
by the interim final rule published on May 16, 2006, and also includes 
new language to address comments and make procedural and structural 
changes in relation to 6 years of implementation.

DATES: Effective Date: This rule is effective on June 11, 2012.

FOR FURTHER INFORMATION CONTACT: Ed Nilson, Appeals and Equitable 
Relief Specialist, Compliance Division, Department of Agriculture, 
Natural Resources Conservation Service, 5601 Sunnyside Avenue, Room 1-
1104-A, Beltsville, Maryland 20705. Telephone: (301) 504-1673; Email: 
ed.nilson@wdc.usda.gov.
    Persons with disabilities who require alternative means for 
communication (Braille, large print, audio tape, etc.) should contact 
the USDA Target Center at (202) 720-2600 (voice and TDD).

SUPPLEMENTARY INFORMATION:

Regulatory Certifications

Executive Order 12866

    This final rule has been determined to not be significant under 
Executive Order 12866 and will not be reviewed by the Office of 
Management and Budget.

Regulatory Flexibility Act

    The Regulatory Flexibility Act is not applicable to this final rule 
because this action will not have a significant economic impact on 
small entities.

Environmental Analysis

    The environmental impacts of this final rule have been considered 
in accordance with the provisions of the National Environmental Policy 
Act of 1969 (NEPA), 42 U.S.C. 4321 et seq., and NRCS has concluded that 
promulgation of this final rule is categorically excluded from NEPA's 
requirement from an environmental impact analysis under USDA 
regulations, 7 CFR 1b.3(a)(1). Actions implemented under this final 
rule fall in the category of policy development, planning, and 
implementation which relates to routine activities and similar 
administrative functions, and no circumstances exist that would require 
preparation of an environmental assessment or environmental impact 
statement.

Civil Rights Impact Analysis

    A review of the NRCS Appeal Procedures final rule has been directed 
towards the identification of actual or potential civil rights issues. 
The review reveals no factors indicating the NRCS Appeal Procedures 
would have a disproportionate adverse civil rights impact for producers 
who are minorities, women, or persons with disabilities.
    Outreach and communication strategies are in place to ensure all 
program participants will be provided the same information to allow 
them to make informed decisions regarding the use of their lands that 
will affect their participation in USDA programs. The NRCS Appeal 
Procedures provisions apply to all persons equally regardless of race, 
color, religion, sex, age, national origin, marital status, familial 
status, sexual orientation, or disability, or because all or part of an 
individual's income is derived from any public assistance program.

[[Page 34187]]

Paperwork Reduction Act

    This final rule does not contain reporting or recordkeeping 
requirements subject to the Paperwork Act.

Executive Order 13132

    This final rule has been reviewed in accordance with the 
requirements of Executive Order 13132, Federalism. NRCS has determined 
this final rule conforms with the Federalism principles set forth in 
the Executive Order; would not impose any compliance costs on the 
States; and would not have substantial direct effects on the States, on 
the relationship between the Federal Government and the States, or on 
the distribution of power and responsibilities on the various levels of 
government.

Executive Order 13175

    Executive Order 13175 requires agencies to consult and collaborate 
with Indian Tribes if policies or actions have substantial direct 
effects on Tribes. NRCS has determined that this regulation does not 
have a substantial direct effect on Indian Tribes since these 
regulatory provisions do not impose unreimbursed compliance costs or 
preempt Tribal law. As a result, consultation is not required.

Unfunded Mandates Reform Act of 1995

    This action does not compel the expenditure of $100 million or more 
in any one year (adjusted for inflation) by any State, local, or Tribal 
governments, or anyone in the private sector. Therefore, a statement 
under section 202 of the Unfunded Mandates Reform Act of 1995 is not 
required.

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

    The Federal Crop Insurance Reform and Department of Agriculture 
Reorganization Act of 1994, Title III, section 304, requires that for 
each proposed major regulation with a primary purpose to regulate 
issues of human health, human safety, or the environment, USDA is to 
publish an analysis of the risks addressed by the regulation and the 
costs and benefits of the regulation. NRCS has determined this final 
rule is not a proposed major regulation; therefore, a risk assessment 
does not apply to this final rule.

Small Business Regulatory Enforcement Fairness Act of 1996 (SBREFA)

    This final rule is neither major nor significant; therefore, it is 
not subject to the SBREFA 60-day requirement. Accordingly, this final 
rule is effective with publication in the Federal Register.

Federal Assistance Programs

    This final rule has a potential impact on all programs listed in 
the Catalog of Federal Domestic Assistance in the Agency Program Index 
under the Farm Service Agency (FSA) and NRCS. Other assistance programs 
are also affected.

Government Paperwork Elimination Act

    NRCS is committed to compliance with the Government Paperwork 
Elimination Act and the Freedom to E-File Act, which require government 
agencies, in general, to provide the public the option of submitting 
information or transacting business electronically to the maximum 
extent possible. This final rule requires that a program participant 
must make a written request for an appeal for a program administered by 
NRCS.

Background and Purpose

    On May 16, 2006, the Chief of NRCS published an Appeal Procedures 
interim final rule (71 FR 28239). Section 275 of the 1994 Act, 7 U.S.C. 
6995, requires USDA agencies to hold informal hearings, at the request 
of a participant, for the decisions they render. NRCS interprets the 
``informal hearing'' requirement to require the agency to provide 
opportunity for an informal appeal at the agency level. This final rule 
amends the interim final rule published May 16, 2006 (71 FR 28239), in 
response to comments received from the public and during 
implementation.
    NRCS' goal in promulgating the informal appeal procedures is to 
facilitate, at the agency level, the resolution of disputes arising 
from adverse technical determinations and program decisions. NRCS' 
informal appeal process establishes several means through which 
participants can obtain a review by NRCS personnel who have detailed 
knowledge of agricultural conservation operations as well as expertise 
in farm and ranch management. After a decision rendered by NRCS becomes 
final, participants may pursue the appeals processes set forth at 7 CFR 
parts 11, 614, and 780, as appropriate.

Public Comment

    NRCS received 13 responses with a total of 64 comments from the 
public in response to the request for comments in the 2006 interim 
final rule. Of the 13 responses, one response was received from an 
individual, two responses were from Federal Government employees, eight 
responses were from state government employees, and two responses were 
received from non-profit organizations. In addition, NRCS received an 
additional 18 responses or suggestions from agency personnel and 
program participants since the 2006 rule was published.
    NRCS received 82 comments on the following sections of the 2006 
rule: Rule in general--1 comment; 7 CFR 614.2, Definitions--6 comments; 
7 CFR 614.4, Decisions not subject to informal appeal procedures--5 
comments; 7 CFR 614.6, Agency records and decision notices--2 comments; 
7 CFR 614.7, Preliminary technical determinations--11 comments; 7 CFR 
614.8, Final technical determinations--10 comments; 7 CFR 614.9, 
Program decisions--1 comment; 7 CFR 614.10, Appeals before the Farm 
Service Agency county committee--2 comments; 7 CFR 614.11, Mediation--
38 comments; 7 CFR 614.12, Transcripts--1 comment; 7 CFR 614.13, 
Appealability review--2 comments; 7 CFR 614.14, Computation of time--1 
comment; 7 CFR 614.15, Implementation of final agency decisions and 7 
CFR 614.16, Participation of third parties in NRCS proceedings--1 
comment. A majority of the responses received regarded mediation, with 
the majority of these comments coming from the eight-state governmental 
responses.

Section by Section Analysis

    NRCS received one comment commending the agency for including 
helpful clarification and better organizing the rule, and one comment 
from an individual that was not relevant to this rulemaking regarding 
agri-business mediators. NRCS is making changes to the substance of the 
existing informal appeals regulation in order to address the comments 
received since the 2006 rulemaking, as well as to improve the informal 
appeals process. The following text describes the changes made to each 
section of the rule.

Section 614.1--General

    This section remains unchanged and explains the scope and purpose 
of the agency's informal appeal regulation. No comments were received 
on this section.

Section 614.2--Definitions

    NRCS received a total of six comments on this section. One comment 
suggested NRCS clarify who may accept an appeal request and the date an 
appeal request is considered filed within the definition of ``appeal.'' 
NRCS finds merit in this comment and has amended the current definition 
to reflect that an appeal request is perfected and considered filed 
when the appropriate accepting official receives

[[Page 34188]]

the participant's request within the 30 days from the date that the 
participant receives the adverse decision. The term ``agency record'' 
has also been amended to refine this definition and help improve the 
agency's decisionmaking and documentation process.
    NRCS also added several definitions in response to three comments 
received during rule implementation. Specifically, definitions have 
been added for the terms ``adverse decision'' and ``agency exhibit'' to 
provide a more precise definition on these terms.
    In response to two comments regarding confusion as to the 
difference between technical determinations and program decisions, NRCS 
agrees there is some confusion and has amended the terms ``Preliminary 
technical determination,'' ``Final technical determination,'' and 
``Program decision.'' The new definitions limit preliminary and final 
technical determinations to those decisions issued pursuant to the 
Highly Erodible Land and Wetland Conservation (HELC/WC) provisions 
solely. ``Program decision'' is to be issued to include any type of 
decision for programs other than those issued pursuant to HELC/WC 
provisions.

Section 614.3--Applicability of Appeal Procedures

    No comments were received on this section. This section sets forth 
the types of decisions that are appealable. In addition, since 
promulgation of the 2006 interim rule, new programs have been 
authorized under Title XII of the Food Security Act of 1985, as 
amended, and some programs have been repealed. This section amends the 
current regulation by updating the listing of programs to which these 
informal appeals apply. NRCS amends this section to ensure the person 
requesting an appeal is the USDA program participant affected by the 
adverse decision by adding subparagraph (c)(2) to 7 CFR 614.3(c).

Section 614.4--Decisions Not Subject to Appeal

    This section provides information on issues that are not considered 
to be appealable under this final rule. NRCS received a total of five 
comments.
    One commenter stated that denial of appeal rights to the National 
Appeals Division (NAD) when NRCS denies a participant's request for 
equitable relief is not in accordance with the statutory construction. 
NRCS agrees a denial of equitable relief is one example of an agency 
adverse decision which is subject to NAD's jurisdiction pursuant to 7 
U.S.C. 6991(1). This is addressed in section 614.9(e) of the final rule 
which states that NRCS will provide notice of appeal rights to NAD on 
program decisions when equitable relief is denied by the Chief or the 
State Conservationist.
    Four other comments received over the implementation period are 
regarding the interpretation of what constitutes a decision adverse to 
the individual participant. NRCS is therefore amending these appeal 
procedures to clarify specifically those issues that cannot be 
challenged through the appeals process.
    NRCS amends this section to clarify that decisions made by the 
Office of the General Counsel concerning real property title standards 
issued by the Attorney General are not appealable to NAD.

Section 614.5--Reservation of Authority

    No comments were received on this section. Under this section, the 
Chief of NRCS or the FSA Administrator as the Vice President of the 
Commodity Credit Corporation (CCC), and the Secretary reserve the 
authority to determine, at any time, any question arising under 
programs within their respective authority or from reversing or 
modifying any program decision or technical determination made by NRCS 
or the CCC.

Section 614.6--Agency Records and Decision Notices

    This section sets forth the agency's policy that all decisions 
under this part must be based upon an agency record. A total of two 
comments were received. The agency record is an administrative record 
comprised of all the documentation, including reports, maps, 
photographs, correspondence, surveys, etc., reviewed when making his or 
her decision. In determining which documents are included in the agency 
record, the decisionmaker will include all documents relevant to the 
adverse decision. The agency is responsible for compiling the agency 
record and maintaining it for each decision that has been issued. A 
copy of the agency record is available to the participant upon request. 
The completeness of the agency record, as well as the consideration of 
all relevant facts, is critical to an effective appeal process. 
Consequently, development of the agency record is being emphasized in 
this rulemaking.
    This section also sets forth agency policy on decision notices 
including content, deadlines, and methods of delivery. Specifically, 
NRCS policy requires that an adverse program decision or technical 
determination must: (1) Be in writing, (2) set forth its factual basis, 
and (3) explain its application of relevant statue, regulations, and 
policy. NRCS must send written notice of its decision to the 
participant via certified mail, return receipt requested, or any other 
type of delivery notification mailing or delivery including hand 
delivery, within 10 working days of rendering a technical determination 
or program decision. This conforms to section 6994 of the 1994 Act, 
which requires that the Secretary provide written notice of an adverse 
decision and notice of appeal rights no later than 10 working days 
after the decision is made.
    Two commenters provided that NRCS may not limit the applicability 
or availability of the NAD formal appeals procedures as implied in the 
regulation at 7 CFR 614.6(b)(3). NRCS has removed the ``if applicable'' 
from this provision.

Section 614.7--Preliminary Technical Determinations

    NRCS received a total of 11 comments on this section, with 2 
comments on the preliminary technical determinations more applicable to 
the actual definition of a preliminary technical determination. NRCS 
addresses these comments by amending the regulation at 7 CFR 614.7(a) 
by adding a statement that these types of determination are limited to 
those rendered under the HELC/WC provisions. Currently, technical 
determinations include any matter of a technical nature for any type of 
program regardless of the statutory authority. These comments suggested 
that it is confusing to include technical determinations for decisions 
other than those issued under the HELC/WC provisions. NRCS agrees and 
is changing the regulations to eliminate this confusion. Preliminary 
technical determinations will include only those initial written 
technical determinations provided to a USDA program participant 
authorized under HELC/WC provisions.
    Two additional comments were received concerning the option for 
mediation provided at 7 CFR 614.7(a)(2) regarding the responsibility 
for notifying the participant of remaining appeals options following 
mediation of the preliminary technical determination. The rule 
currently allows a program participant who has been issued a 
preliminary technical determination to request either mediation or 
reconsideration with a field visit. If mediation has been selected as 
the first option, and there is still time remaining to request a field 
visit, the participant may request this preliminary technical review 
option. If the participant comes to a mediated agreement during this

[[Page 34189]]

period, then the rule at 7 CFR 614.11(d) requires waiver of all further 
appeal rights as to that determination or portion of that 
determination. If mediation is unsuccessful, and time for any further 
preliminary appeal options has expired, NRCS will issue a final 
technical determination that is appealable to either NAD under 7 CFR 
part 11, or to the FSA county committee as provided at 7 CFR 614.8 and 
614.10. Therefore, no changes will be made to this section.
    NRCS received one comment on 7 CFR 614.7(a)(2) contending the 
requirement that a participant request mediation through the designated 
NRCS official as provided in 7 CFR 614.11(a) is burdensome. This 
comment will be addressed in 7 CFR 614.11(a) rather than in 7 CFR 
614.7(a)(2).
    Five other comments requested clarification of whether a field 
visit is the only option, or if another location for review of the 
preliminary technical determination is available. Currently, the 
regulation has been interpreted in a limiting manner that the review 
must be completed in the field because of the actual wording in the 
rule. NRCS has reviewed the original basis for this review and 
reconsideration, and finds that the goal of review and reconsideration 
as stated in the 2006 rule at 71 FR 28241 is to ``improve the accuracy 
of technical determinations and sufficiency of the administrative 
record upon which the technical determination is based.'' Further, a 
field visit is useful to develop additional information that was not 
previously known to NRCS or the participant or to accept what has been 
found. Therefore, NRCS has determined the field visit to the actual 
site on the farm is not required to have a successful reconsideration, 
and is amending 7 CFR 614.7(a)(1) to include either a field visit or 
office visit are options available to the participant. Regardless of 
how the reconsideration is conducted, the main purpose is to ``afford 
an adequate informal appeal process at the agency level where such 
expertise resides [and] is essential to effective program 
administration.'' (See 71 FR 28239, 28243 (May 16, 2006).)
    NRCS is also providing additional clarification of 7 CFR 614.7(b) 
by separating the four major actions needed to complete preliminary 
technical determination reconsideration.
    One commenter stated that NRCS has no authority to require waiver 
of statutory rights to the informal review as is currently provided at 
7 CFR 614.7(d). This provision does not require any participant to 
waive his or her rights to an informal review. Rather, the regulation 
allows participants to immediately proceed to their informal appeal 
rights of the FSA county committee under 7 CFR 614.8(b)(1) or exercise 
their formal appeal rights to NAD under 7 CFR 614.8(b)(2). The 
provision is one of ``expedited finality'' and has been provided for 
participants who want a final technical determination so that they may 
begin required actions as determined by NRCS (e.g., wetland 
restoration) or to proceed with another type of action requiring a 
final HELC/WC determination, such as a Farm Credit loan.

Section 614.8--Final Technical Determinations

    This section sets forth the informal appeal procedures available 
when preliminary technical determinations become final. NRCS received a 
total of 10 comments on this section, with one comment claiming that 
NRCS precluded a participant's rights to appeal to NAD and 9 comments 
claiming that the process with technical determinations and program 
decisions is confusing. NRCS agrees and is amending 7 CFR 614.7 and 
614.8 to be limited to appeals of HELC/WC technical determinations and 
7 CFR 614.9 limited to programs administered by NRCS to reduce any 
further confusion.

Section 614.9--Program Decisions

    NRCS received one comment recommending that NRCS clarify the 
difference between an appeal of a technical determination and an appeal 
of a program decision. This section sets forth the informal appeals 
procedures available for program decisions. Currently, program 
decisions are decisions issued for conservation programs administered 
by NRCS that relate to the administration of a conservation program. 
Unlike HELC/WC technical determinations, program decisions are issued 
as ``final decisions'' meaning they may be appealed directly to NAD, or 
if the program decision is made under a Title XII program, 
additionally, but before NAD, to the FSA county committee.
    NRCS agrees and has made changes to this section, as well as in 7 
CFR 614.7 and 614.8.

Section 614.10--Appeals Before the Farm Service Agency County Committee

    This section provides that any adverse decision issued under a 
Title XII program may be appealed to the FSA county committee. NRCS 
received two comments on this section. NRCS received one comment 
concerning whether a participant must exercise the informal appeal 
before the FSA county committee prior to requesting a formal appeal 
from NAD. As provided in the preamble to the 2006 interim final rule 
(71 FR 28239, 28242), and pursuant to 7 U.S.C. 6995 and 7 CFR part 780, 
a participant may seek an optional informal review by an FSA county 
committee of an NRCS final technical determination or program decision 
made for a conservation program authorized under Title XII. A 
participant may also choose to forego the FSA county committee appeal 
option and appeal directly to NAD under 7 CFR part 11.
    The other commenter recommended the rule should better explain the 
FSA county committee's jurisdictional limitations. The authorizing 
statute, 7 U.S.C. 6932(d)(2)(A), provides that the county committee 
must provide a method for obtaining review of NRCS adverse technical 
and program decisions. Both NRCS and FSA appeal procedures explain the 
requirements that the FSA county committee must adhere to when hearing 
informal appeals of NRCS adverse decisions. Both agencies have issued 
further instructions in the applicable policy manual or handbook. NRCS 
does not believe an amendment to this section is necessary.

Section 614.11--Mediation

    NRCS received 38 comments on 7 CFR 614.11, as follows: 7 CFR 
614.11(a)--5 comments; 7 CFR 614.11(c)--7 comments; 7 CFR 614.11(e)--10 
comments; and 7 CFR 614.11(g)--16 comments.
    Five of the comments suggested that participants should be able to 
request mediation from the mediation service provider rather than 
through the designated NRCS official as provided in 7 CFR 614.11(a). 
NRCS agrees and is changing this to the official designated in the 
decision notice.
    Five commenters suggested that NRCS adopt the language in the NAD 
Rule at 7 CFR 11.5(c)(1) with regard to stays of time on an appeal for 
mediation in 7 CFR 614.11(c). NRCS agrees and is changing the rule in 
this section to reflect that a request for mediation stops the running 
of the 30-day timeframe for requesting an appeal. Two comments 
suggested that NRCS amend the amount of time allowed for mediation of 
technical determinations when a field review might be required. NRCS 
agrees a field visit might require additional time, and this is 
addressed by allowing the parties to agree to an extension of the 30-
day timeframe.
    Ten comments were received on 7 CFR 614.10(e) stating a concern 
that there is no clear guidance on finalizing

[[Page 34190]]

the mediation settlement agreement where the NRCS representative did 
not have authority to bind NRCS. The comments provided that NRCS should 
vest their representative with authority to bind the agency in 
mediation or have the person that can make those decisions present at 
the mediation or in contact by telephone. The commenters believed that 
otherwise, due process was being denied. NRCS believes the current rule 
provides sufficient safeguards, and no changes will be made to this 
paragraph.
    NRCS received a total of 16 comments on 7 CFR 614.11(g). Of the 16, 
8 did not agree with use of any materials other than the mediation 
agreement in administrative or judicial proceedings. Six comments were 
concerned about the use of notes or summary reports by one party or the 
other in the absence of both parties during or after the mediation 
session with parties not named in the agreement to mediate, and two 
comments were received concerning whether parties to mediation may 
participate in further administrative or judicial proceedings.
    The commenters suggest that the use of notes or summaries developed 
during mediation should not be allowed because there is a risk of 
distorting or taking those notes and summaries out of context. The 
commenters suggested that NRCS amend this section to include the 
following: ``during mediation, if any party needs to contact an advisor 
not present, the party will secure the consent of the other party(s) 
before communicating with that person not present.'' NRCS does not 
agree, as the agency must have the ability to contact officials not 
present at the mediation, and making such contact does not affect the 
confidentiality of the mediation process.
    Except where the rule provides for NRCS to discuss settlement 
issues with another USDA official should the NRCS representative not 
have authority to decide an issue, NRCS finds the rule provides the 
appropriate confidentiality of the parties in the mediation process. In 
addition, 5 U.S.C. 574 limits both the disclosure and admissibility of 
such notes or summaries. Therefore, NRCS declines to amend the final 
rule.
    Regarding the comments on whether any of the mediation participants 
can testify about or furnish documents of the mediation in 
administrative or judicial proceedings, NRCS is amending this section 
to clarify confidentiality expectations as they pertain to further 
administrative or judicial proceedings. It is noted, however, 5 U.S.C. 
574 contains the limitations (with exceptions) to such testimony or 
provision of documents.

Section 614.12--Transcripts

    This provision was added in the 2006 interim final rule. One 
comment suggested that banning recordings of the proceedings by the 
participant is wrong and does not comport with the NAD rules. NRCS 
disagrees with this comment. The State Conservationist's hearing is an 
informal appeal hearing, not a formal administrative hearing held by 
NAD. In order to maintain the informal atmosphere and to encourage full 
participation by both the participant and NRCS, the recording of an 
informal proceeding is a disincentive to open communication and 
resolution of the appeal.

Section 614.13--Appealability Review

    This section was added in the 2006 interim final rule that would 
allow the State Conservationist to make decisions regarding 
Appealability. Two comments were received. NRCS is amending this 
section to provide that if the agency decides the decision at issue is 
not appealable, then NRCS must provide review rights to the participant 
under the NAD rules at 7 CFR 11.6(a).

Section 614.14--Computation of Time

    This section was added in the 2006 interim final rule. NRCS 
received one comment regarding time remaining after mediation to 
request further appeal action. This comment was more adequately 
addressed under 7 CFR 614.11.

Section 614.15--Implementation of Final NAD Determinations

    This section was added in the 2006 interim final rule. NRCS 
received one comment stating that NRCS cannot delay implementation of a 
NAD determination beyond the 30 days specified in the statute. NRCS' 
comments on this section in the preamble were not intended to delay 
implementation of a final administrative decision. As provided in the 
rule, NRCS will implement all final NAD administrative determinations 
within 30 days after the decision becomes final. NRCS is amending this 
section to add new requirements on implementation of NAD final 
administrative appeal decisions as provided in section 14009 of the 
Food Conservation and Energy Act of 2008 (Farm Bill). This amendment to 
the appeals reporting requires the agency to provide a biannual report 
to the Chairman of the Senate Committee on Agriculture, Nutrition and 
Forestry and the Chairman of the House Committee on Agriculture on the 
status of implementing final NAD determinations along with reasons why 
a decision has not been implemented. The agency must publish these 
reports on the agency's Web site and keep the site updated with actions 
taken on any determinations not implemented within the required 
timeframe.

Section 614.16--Participation of Third Parties in NRCS Proceedings

    This is a new section added in the 2006 interim final rule. The 
only comment received pertains to a correction of a typographical error 
that repeats the word party in the first sentence. NRCS will correct 
the error in this final rule.

Section 614.17--Judicial Review

    This section was added in the 2006 interim final rule. No comments 
were received on this section and no changes have been made.

List of Subjects in 7 CFR Part 614

    Administrative practice and procedure, Agriculture, Agriculture 
commodities, Alternative Dispute Resolution, Appeal, Conservation 
programs, Contracts, Decisions, Determinations, Easements, Farmers, 
Farmland, Mediation, Soil conservation.


0
For the reasons stated in the preamble, 7 CFR part 614 is revised to 
read as follows:

PART 614--NRCS APPEAL PROCEDURES

Sec.
614.1 General.
614.2 Definitions.
614.3 Decisions subject to informal appeal procedures.
614.4 Decisions not subject to informal appeal procedures.
614.5 Reservation of authority.
614.6 Agency records and decision notices.
614.7 Preliminary technical determinations.
614.8 Final technical determinations.
614.9 Program decisions.
614.10 Appeals before the Farm Service Agency county committee.
614.11 Mediation.
614.12 Transcripts.
614.13 Appealability review.
614.14 Computation of time.
614.15 Implementation of final NAD decisions.
614.16 Participation of third parties in NRCS proceedings.
614.17 Judicial review.

    Authority:  5 U.S.C. 301; 7 U.S.C. 6932 and 6995; and 16 U.S.C. 
3822(a).


Sec.  614.1  General.

    This part sets forth the informal appeal procedures under which a 
participant may appeal adverse

[[Page 34191]]

technical determinations or program decisions made by officials of the 
Natural Resources Conservation Service (NRCS), an agency under the 
Department of Agriculture (USDA). These regulations reflect NRCS policy 
to resolve at the agency level, to the greatest extent possible, 
disputes arising from adverse technical determinations and program 
decisions made by NRCS. Once a decision is rendered final by NRCS, 
participants may appeal to the National Appeals Division (NAD) as 
provided for under 7 CFR part 11, or to the Farm Service Agency (FSA) 
county committee pursuant to 7 CFR part 780 for decisions rendered 
under Title XII of the Food Security Act of 1985, as amended, 16 U.S.C. 
3801 et seq. (Title XII).


Sec.  614.2  Definitions.

    The following definitions are applicable for the purposes of this 
part:
    Adverse decision means the final technical determination or the 
program decision issued by NRCS that is adverse to the individual 
participant and not a matter of general applicability.
    Agency means NRCS and its employees.
    Agency exhibit means those documents or materials that are used 
during the hearing to further explain, differentiate, or distinguish a 
point, concept, or criteria in an appeal but that were not those 
materials or documents that the agency relied upon in making the 
adverse decision. Agency exhibits are labeled alphabetically A, B, C, 
etc., with total pages in each exhibit numbered.
    Agency record means all documents and materials, including 
documents submitted by the participant and those generated by NRCS, 
which the agency relies upon and bases its program decision or 
technical determination. The agency record will include all documents 
relevant to the adverse decision. NRCS maintains the agency record and 
will, upon request or appeal, make available a copy of the agency 
record for a specific adverse decision to the participant(s) involved 
in the dispute. Agency record documents are labeled numerically 1, 2, 
3, etc., in the lower right hand of the document.
    Appeal means a written request by a participant asking for review 
(including mediation) of an adverse NRCS technical determination or 
program decision under this part. An appeal must set out the reason(s) 
for appeal and include any supporting documentation. An appeal is 
considered filed when the participant's request has been received by 
the accepting official as indicated in the adverse decision notice.
    Chief means the Chief of NRCS or his or her designee.
    Commodity Credit Corporation means a wholly owned government 
corporation within USDA.
    Conservation district means any district or unit of State or local 
government developed under State law for the express purpose of 
developing and carrying out a local soil and water conservation 
program. Such district or unit of government may be referred to as a 
conservation district, soil and water conservation district, natural 
resource district, conservation committee, or similar name.
    County committee means a FSA county or area committee established 
in accordance with section 8(b) of the Soil Conservation and Domestic 
Allotment Act (16 U.S.C. 590h(b)).
    Designated conservationist means the NRCS official, usually the 
district conservationist, whom the State Conservationist designates to 
be responsible for the program or compliance requirement to which this 
part is applicable.
    Final technical determination means a preliminary technical 
determination issued under the Highly Erodible Land and Wetland 
Conservation (HELC/WC) provisions found in 7 CFR part 12 that have 
become final, and thus, appealable under sections 8 or 10 of this final 
rule.
    Hearing means an informal appeal proceeding, either before the NRCS 
State Conservationist or the FSA county committee that affords a 
participant opportunity to present testimony and documentary evidence 
to show why an adverse program decision is in error and why the adverse 
decision should be reversed.
    Mediation means a process in which a neutral third party, the 
mediator, meets with the disputing parties, usually the participant and 
the agency. Through mediation, the parties have the opportunity to work 
together with the assistance of the mediator to: Improve 
communications, understand the relevant issues, develop and explore 
alternatives, and reach a mutually satisfactory resolution.
    Mediator means a neutral third party who serves as an impartial 
facilitator between two or more parties to assist them in resolving a 
dispute. The mediator does not take sides or render decisions on the 
merits of the dispute. The mediator assists the parties in identifying 
areas of agreement and encourages the parties to explore potential 
options toward resolution.
    Participant means any individual or entity who has applied for, or 
whose right to participate in or receive, a payment or other benefit in 
accordance with any program administered by NRCS to which the 
regulations in this part apply and is affected by a decision of NRCS. 
The term does not include those individuals or entities excluded in the 
definition of participant published at 7 CFR 11.1.
    Preliminary technical determination means the initial written 
decision by NRCS for a technical matter under HELC/WC which has not 
become final under this part.
    Program decision means a written decision by NRCS concerning 
eligibility for program benefits, program administration, or program 
implementation and based upon applicable regulations and program 
instructions and not a technical determination made solely for the 
HELC/WC provisions. Program decisions may include technical matters 
relative to the specific conservation program. These are final 
decisions upon receipt by the program participant.
    Qualified mediator means a mediator who is accredited under State 
law in those States that have a mediation program certified by USDA 
pursuant to 7 CFR part 785, or in those States that do not have a 
mediation program certified by USDA, an individual who has attended a 
minimum of 40 hours of core mediator knowledge and skills training and, 
to remain in a qualified mediator status, completes a minimum of 20 
hours of additional training or education during each 2-year period. 
Such training or education must be approved by USDA, an accredited 
college or university, or one of the following organizations: State 
Bar, a State mediation association, a State approved mediation program, 
or a society of dispute resolution professionals.
    Reconsideration means a subsequent consideration of a preliminary 
technical determination by the designated conservationist or the State 
Conservationist.
    Secretary means the Secretary of Agriculture.
    State Conservationist means the NRCS official, or his or her 
designee, in charge of NRCS operations within a State.
    Title XII means Title XII of the Food Security Act of 1985, as 
amended, 16 U.S.C. 3801 et seq.
    Verbatim transcript means the official, written record of 
proceedings of a hearing on a decision appealable under this part.

[[Page 34192]]

Sec.  614.3  Decisions subject to informal appeal procedures.

    (a) This part applies to NRCS adverse program decisions and 
technical determinations made with respect to:
    (1) Conservation programs and regulatory requirements authorized 
under Title XII, including:
    (i) Conservation Security Program;
    (ii) Conservation Stewardship Program;
    (iii) Conservation Reserve Program and the Conservation Reserve 
Enhancement Program;
    (iv) Environmental Quality Incentives Program, including the 
following:
    (A) Agricultural Water Enhancement Program,
    (B) Conservation Activity Plans,
    (C) Colorado River Basin Salinity Control,
    (D) Conservation Innovation Grants,
    (E) Ground and Surface Water Conservation Program,
    (F) Klamath Basin Program, and
    (G) Organic Program Initiative;
    (v) Farm and Ranch Land Protection Program;
    (vi) Grassland Reserve Program;
    (vii) Highly Erodible Land Conservation;
    (viii) Wetland Conservation;
    (ix) Wetlands Reserve Program and Wetlands Reserve Enhancement 
Program; and
    (x) Wildlife Habitat Incentive Program.
    (2) Non-Title XII conservation programs or provisions, including:
    (i) Agriculture Management Assistance Program;
    (ii) Emergency Watershed Protection Program including Flood Plain 
Easements;
    (iii) Great Lakes Restoration Initiative;
    (iv) Healthy Forest Reserve Program;
    (v) Water Bank Program;
    (vi) Watershed Protection and Flood Prevention Program; and
    (3) Any other program to which this part is made applicable.
    (b) With respect to matters identified in paragraph (a) of this 
section, participants may appeal adverse decisions concerning:
    (1) Denial of participation in a program;
    (2) Compliance with program requirements;
    (3) Issuance of payments or other program benefits to a participant 
in a program;
    (4) Technical determinations made under Title XII HELC/WC 
provisions;
    (5) Technical determinations or program decisions that affect a 
participant's eligibility for USDA program benefits;
    (6) The failure of an NRCS official issue a technical determination 
or program decision subject to this part (``failure to act''); and
    (7) Incorrect application of general policies, statutory or 
regulatory requirements.
    (c)(1) Only a participant directly affected by a program decision 
or a technical determination made by NRCS may invoke the informal 
appeal procedures contained in this part.
    (2) In order for the appeal request to be effective, the 
participant must personally make a written request for appeal that is 
signed by the participant identified in paragraph (c)(1) no later than 
30 days after receipt of the adverse decision.
    (d) Appeals of adverse final technical determinations and program 
decisions subject to this part are also covered by the NAD rules of 
procedure, set forth at 7 CFR part 11, and by the FSA county committee 
appeals process, set forth at 7 CFR parts 11 and 780 for informal 
appeals of Title XII decisions.


Sec.  614.4  Decisions not subject to informal appeal procedures.

    (a) Decisions that are not appealable under this part include:
    (1) Any general program provision, program policy, or any statutory 
or regulatory requirement that is applicable to all similarly situated 
participants, such as:
    (i) Program application ranking criteria;
    (ii) Program application screening criteria;
    (iii) Published soil surveys; or
    (iv) Conservation practice technical standards included in the 
local field office technical guide or the electronic FOTG (eFOTG).
    (2) Mathematical or scientific formulas established under a statute 
or program regulation and a program decision or technical determination 
based solely on the application of those formulas;
    (3) Decisions made pursuant to statutory provisions or implementing 
regulations that expressly make agency program decisions or technical 
determinations final;
    (4) Decisions that are based on technical information provided by 
another Federal or State agency, e.g., lists of endangered and 
threatened species;
    (5) Corrections by NRCS of errors in data entered on program 
contracts, easement documents, loan agreements, and other program 
documents; or
    (6) Decisions issued by the Office of the General Counsel, in the 
exercise of authority delegated to it by the Attorney General, 
concerning the application of real property title standards issued by 
the Attorney General.
    (b) Complaints involving discrimination in program delivery are not 
appealable under this part and are handled under the existing USDA 
civil rights rules and regulations.
    (c) Appeals related to contractual issues that are subject to the 
jurisdiction of the Civilian Board of Contract Appeals are not 
appealable under the procedures within this part.
    (d) Where NRCS is unable to fund an application for program 
participation due to a lack of funds. The agency may not deny appeal of 
the underlying computations used to rank and prioritize the 
application.


Sec.  614.5  Reservation of authority.

    The Secretary of Agriculture, Chief of NRCS, if applicable, or 
designee, reserves the right to make a determination at any time on any 
question arising under the programs covered under this regulation 
within their respective authority, including reversing or modifying in 
writing, with sufficient reason given therefore, any program decision 
or technical determination made by an NRCS official.


Sec.  614.6  Agency records and decision notices.

    (a) All NRCS decisions under this part are based upon an agency 
record. NRCS will supplement the agency record, as appropriate, during 
the informal appeals process.
    (b) NRCS notifies participants of the agency's preliminary and 
final technical determinations and program decisions through decision 
notices. By certified mail, return receipt requested, NRCS will send to 
the participant a decision notice within 10 working days of rendering a 
technical determination or program decision. In lieu of certified mail, 
NRCS may hand deliver notices to participants with written 
acknowledgment of delivery by the participant. Each decision notice 
contains the following:
    (1) The factual basis for the technical determination or program;
    (2) The regulatory, statutory, or policy basis for the technical 
determination or program decision; and
    (3) Information regarding any informal appeal rights available 
under this part; the process for requesting such appeal; and the 
procedure for requesting further review before the FSA county committee 
pursuant to 7 CFR part 780 or NAD pursuant to 7 CFR part 11.


Sec.  614.7  Preliminary technical determinations.

    (a) A preliminary technical determination is limited to those

[[Page 34193]]

determinations made pursuant to the HELC/WC provisions (16 U.S.C. 3801, 
et seq.) and becomes final 30 days after the participant receives the 
decision, unless the participant files an appeal with the appropriate 
NRCS official as indicated in the decision notice requesting:
    (1) Reconsideration with a field visit, office visit, or other 
designated location meeting site in accordance with paragraphs (b) and 
(c) of this section; or
    (2) Mediation as set forth in Sec.  614.11.
    (b)(1) If the participant requests reconsideration with a field 
visit, office visit, or other location visit, the designated 
conservationist, participant, and at the option of the conservation 
district, a district representative will make a field or office visit 
for the purpose of gathering additional information and discussing the 
facts relating to the preliminary technical determination. The 
participant may also provide any additional documentation to the 
designated conservationist.
    (2) Within 15 days of the field or office visit, the designated 
conservationist, based upon the agency record as supplemented by the 
field visit and any participant submissions, will reconsider his or her 
preliminary technical determination.
    (3) If the reconsidered determination is no longer adverse to the 
participant, the designated conservationist will issue the reconsidered 
determination as a final technical determination.
    (4) If the preliminary technical determination remains adverse, 
then the designated conservationist will forward the revised decision 
and agency record to the State Conservationist for a final 
determination pursuant to paragraph (c) of this section, unless further 
appeal is waived in writing by the participant in accordance with 
paragraph (d) of this section.
    (c) The State Conservationist will issue a final technical 
determination to the participant as soon as is practicable after 
receiving the reconsideration and agency record from the designated 
conservationist. The technical determination issued by the State 
Conservationist becomes a final NRCS technical determination upon 
receipt by the participant. Receipt triggers the running of the 30-day 
timeframe to appeal to NAD, or if applicable, to the FSA county 
committee.
    (d) In order to address application needs or resource issues on the 
ground immediately (expedited finality), a participant may waive, in 
writing to the State Conservationist, the reconsideration rights stated 
in paragraph (a) of this section so that a preliminary technical 
decision becomes final before the expiration of the 30-day appeal 
period.


Sec.  614.8  Final technical determinations.

    (a) Preliminary HELC/WC technical determinations become final and 
appealable:
    (1) Thirty days after receipt of the preliminary technical decision 
by the participant unless the determination is appealed in a timely 
manner as provided for in this regulation.
    (2) Thirty calendar days after the beginning of a mediation session 
if a mutual agreement has not been reached by the parties; or
    (3) Upon receipt by the participant of the final technical 
determination issued on reconsideration as provided in Sec.  614.7(c).
    (b) The participant may appeal the final technical determination 
issued under the HELC/WC provisions to:
    (1) The FSA county committee pursuant to 7 CFR part 780; or
    (2) NAD pursuant to 7 CFR part 11.


Sec.  614.9  Program decisions.

    (a) Program decisions are final upon receipt of the program 
decision notice by the participant. Program decisions include all 
decisions issued by NRCS for programs that NRCS administers separate 
from the HELC/WC provisions. The participant has the following options 
for appeal of the program decision:
    (1) An informal hearing before NRCS as provided for in paragraph 
(b) through paragraph (d) of this section;
    (2) Mediation as provided for in Sec.  614.11;
    (3) An informal hearing before the FSA county committee pursuant to 
7 CFR part 780 if the program decision is made under Title XII; or
    (4) A hearing before NAD pursuant to 7 CFR part 11.
    (b) A program participant must file an appeal request for a hearing 
with the appropriate State Conservationist as indicated in the decision 
notice within 30 calendar days from the date the participant received 
the program decision.
    (c) The State Conservationist may accept a hearing request that is 
untimely filed under paragraph (b) of this section if the State 
Conservationist determines that circumstances warrant such an action.
    (d) The State Conservationist will hold a hearing no later than 30 
days from the date the appeal request was received. The State 
Conservationist will issue a written final decision no later than 30 
days from the close of the hearing.
    (e) NRCS will provide notice of the right to appeal to NAD on 
program decisions when equitable relief is denied by the Chief or the 
State Conservationist.


Sec.  614.10  Appeals before the Farm Service Agency county committee.

    (a) In accordance with 7 CFR part 780, a participant may appeal a 
final technical determination or a program decision to the FSA county 
committee for those decisions made under Title XII.
    (b) When the FSA county committee hearing the appeal requests 
review the technical determination by the applicable State 
Conservationist prior to issuing their decision, the State 
Conservationist will:
    (1) Designate an appropriate NRCS official to gather any additional 
information necessary for review of the technical determination;
    (2) Obtain additional oral and documentary evidence from any party 
with personal or expert knowledge about the facts under review; and
    (3) Conduct a field visit to review and obtain additional 
information concerning the technical determination.
    (c) After the actions set forth in paragraphs (b)(1) through (3) of 
this section are completed, provide the FSA county committee with a 
written technical determination in the form required by Sec.  
614.6(b)(1) through (2) as well as a copy of the agency record.


Sec.  614.11  Mediation.

    (a) A participant who wishes to pursue mediation must file a 
request for mediation under this part with the official designated in 
the decision notice no later than 30 days after the date on which the 
decision notice was received. Participants in mediation are normally 
required to pay fees established by the mediation program.
    (b) A dispute will be meditated by a qualified mediator as defined 
at Sec.  614.2(n).
    (c) The parties will have 30 days from the date of the first 
mediation session to reach a settlement agreement. This date can be 
extended upon agreement of the parties. The mediator will notify the 
State Conservationist whether the parties have reached an agreement.
    (d) Settlement agreement reached during, or as a result of, the 
mediation process must be in writing, signed by all parties to the 
mediation, and comply with the statutory and regulatory provisions and 
policies governing the program. In addition, the participant must waive 
all appeal and judicial rights as to the issues resolved by the 
settlement agreement.
    (e) At the outset of mediation, the parties must agree to mediate 
in good

[[Page 34194]]

faith. NRCS demonstrates good faith in the mediation process by, among 
other things:
    (1) Designating an NRCS representative in the mediation;
    (2) Making pertinent records available for review and discussion 
during the mediation; and
    (3) To the extent the NRCS representative does not have authority 
to bind the agency, directing the NRCS representative to forward, in a 
timely manner, any written agreement proposed in mediation to the 
appropriate NRCS official for consideration.
    (f) Mediator impartiality. (1) No person may serve as mediator in 
an adverse program dispute who has previously served as an advocate or 
representative for any party in the mediation.
    (2) No person serving as mediator in an adverse program dispute may 
thereafter serve as an advocate for a participant in any other 
proceeding arising from or related to the mediated dispute including, 
without limitation, representation of a mediation participant before an 
administrative appeals entity of USDA or any other Federal agency.
    (g) Confidentiality. Mediation is a confidential process except for 
those limited exceptions permitted by the Administrative Dispute 
Resolution Act at 5 U.S.C. 574. As a condition of participation, the 
participants and any interested parties joining the mediation must 
agree to the confidentiality of the mediation process. The mediator 
will not testify in administrative or judicial proceedings concerning 
the issues discussed in mediation, nor submit any report or record of 
the mediation discussions, other than the mediation agreement or the 
mediation report, except as required by law.


Sec.  614.12  Transcripts.

    (a) No recordings will be made of any informal hearing conducted 
under Sec.  614.9. In order to obtain an official record of a hearing, 
a participant may obtain a verbatim transcript as provided in paragraph 
(b) of this section.
    (b) Any party to an informal hearing appeal under Sec.  614.9 may 
request that a verbatim transcript is made of the hearing proceedings 
and that such transcript is made the official record of the hearing. 
The party requesting a verbatim transcript must pay for the 
transcription service and provide a copy of the transcript to NRCS at 
no charge.


Sec.  614.13  Appealability review.

    If NRCS states that a decision is not adverse to the individual 
participant, and thus, no right to appeal exists, NRCS will notify the 
participant that he may seek review of that determination from the NAD 
Director.


Sec.  614.14  Computation of time.

    (a) The word ``days'' as used in this final rule means calendar 
days, unless specifically stated otherwise.
    (b) Deadlines for any action under this part, including deadlines 
for filing and decisions which fall on a Saturday, Sunday, Federal 
holiday, or other day on which the relevant NRCS office is closed 
during normal business hours, will be extended to close of business the 
next working day.


Sec.  614.15  Implementation of final NAD determinations.

    (a) No later than 30 days after a NAD determination becomes a final 
administrative decision of USDA, NRCS will implement the determination.
    (b) Biannually, NRCS must file a report on the status of 
implementation of final administrative determinations in accordance 
with section 14009 of the 2008 Farm Bill.


Sec.  614.16  Participation of third parties in NRCS proceedings.

    When an appeal is filed under this part, NRCS will notify any third 
party whose interests may be affected of the right to participate as an 
appellant in the appeal. If the third party declines to participate, 
then NRCS' decision will be binding as to that third party as if the 
party had participated. If a formal hearing is conducted by NAD, third 
party issues will be decided by NAD.


Sec.  614.17  Judicial review.

    A participant must receive a final determination from NAD pursuant 
to 7 CFR part 11 prior to seeking judicial review in any U.S. District 
Court of competent jurisdiction.

    Signed this 29th day of May 2012, in Washington, DC.
Dave White,
Vice President, Commodity Credit Corporation, and Chief, Natural 
Resources Conservation Service.
[FR Doc. 2012-14098 Filed 6-8-12; 8:45 am]
BILLING CODE 3410-16-P