Highly Fractionated Indian Land (HFIL) Loan Program, 74966-74974 [2015-30331]
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Federal Register / Vol. 80, No. 230 / Tuesday, December 1, 2015 / Rules and Regulations
approved this document on November
18, 2015, for publication.
Dated: November 24, 2015.
Michael P. Shores,
Chief Impact Analyst, Office of Regulation
Policy & Management, Office of the General
Counsel, Department of Veterans Affairs.
Accordingly, the interim final rule
adding 2 CFR part 802 and amending 38
CFR parts 41 and 43, which was
published in the Federal Register at 79
FR 75871 on December 19, 2014, is
adopted as final without changes.
■
[FR Doc. 2015–30346 Filed 11–30–15; 8:45 am]
BILLING CODE 8320–01–P
DEPARTMENT OF AGRICULTURE
Agricultural Research Service
7 CFR Part 504
RIN 0518–AA05
Changes to Fees and Payment
Methods
Agricultural Research Service,
USDA.
ACTION: Final rule.
AGENCY:
The Agricultural Research
Service (ARS) increases its Patent
Culture Collection charges, and revises
the method of payment.
DATES: This rule is effective December 1,
2015.
FOR FURTHER INFORMATION CONTACT:
Jeffrey Kurtz, ARS-Budget and Program
Management Staff, George Washington
Carver Center, 5601 Sunnyside Avenue,
Room 4–1106, Beltsville, Maryland,
20705, telephone: (301) 504–4494,
email: jeff.kurtz@ars.usda.gov.
SUPPLEMENTARY INFORMATION: Microbialbased agriculture and biotechnology
rely on superior production strains, new
strains with novel characteristics, and
reference strains for comparative
purposes. Such strains are often difficult
to acquire or are cost prohibitive for
many researchers. ARS has a staff
dedicated to the acquisition and
distribution of microbial germplasm in
which patented strains can be deposited
in and distributed from its Patent
Culture Collection for a one-time fee to
cover maintenance and distribution
costs.
ARS’ Patent Culture Collection
receives about 120 patent deposits per
year, and distributes about 450 cultures
per year. Nearly all of the accessions
and distributions are requested by
companies, universities, or Government
agencies. Currently, ARS charges $500
for each microbial culture deposit, as set
forth in 7 CFR 504.2(a). For each
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SUMMARY:
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microbial culture distribution ARS
charges $20, as set forth in 7 CFR
504.2(b). The current fees, which were
established in 1985, did not reflect the
actual costs of providing materials and
services. ARS is increasing these fees to
reflect their actual costs of $670 and
$40, respectively, and to apply the
distribution fee to all patent deposits
regardless of the date of the deposit.
Currently, payment for deposit and
requisition of microbial cultures is made
by check, draft, or money order payable
to the USDA, National Finance Center,
as set forth in 7 CFR 504.3(b). ARS is
adding pay.gov as a method of payment
to assist customers.
The increased fees will enable ARS’
Patent Culture Collection to continue its
mission of supporting microbiological
research and biotechnological
innovation, and serve as a repository
where patented microbial strains can be
deposited and distributed to the
scientific community. All of the current
services will continue to be offered
under the revised fee schedule and
method of payment.
This rule was published as a proposed
rule for comment on September 2, 2015.
See 80 FR 53021, September 2, 2015. No
comments were received.
List of Subjects in 7 CFR Part 504
Agricultural research.
For reasons set forth in the preamble,
ARS amends 7 CFR part 504 as set forth
below:
PART 504—USER FEES
1. The authority citation for part 504
continues to read as follows:
■
Authority: 31 U.S.C. 9701.
■
2. Revise § 504.2 to read as follows:
§ 504.2 Fees for deposit and requisition of
microbial cultures.
(a) Depositors of microbial cultures
must pay a one-time $670 user fee for
each culture deposited on or after
December 1, 2015.
(b) For cultures deposited on or after
December 1, 2015, requestors must pay
a $40 user fee for each culture
distributed.
■
3. Revise § 504.3 to read as follows:
§ 504.3
Payment of fees.
(a) Payment of user fees must
accompany a culture deposit or request.
(b) Payment shall be made by check,
draft, money order, or pay.gov, payable
to USDA, National Finance Center.
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Dated: November 23, 2015.
Simon Y. Liu,
Associate Administrator, ARS.
[FR Doc. 2015–30449 Filed 11–30–15; 8:45 am]
BILLING CODE 3410–03–P
DEPARTMENT OF AGRICULTURE
Farm Service Agency
7 CFR Parts 761 and 769
RIN 0560–AI32
Highly Fractionated Indian Land (HFIL)
Loan Program
Farm Service Agency, USDA.
Final rule.
AGENCY:
ACTION:
The Farm Service Agency
(FSA) is implementing the HFIL Loan
Program to provide revolving loan funds
to eligible intermediary lenders familiar
with Indian Lands. The intermediary
lenders will provide loan funds to
qualified individuals, entities, and
tribes to purchase highly fractionated
Indian land consistent with the
Agricultural Act of 2014 (2014 Farm
Bill). FSA is also requesting public
comments on the rule.
DATES: Effective date: December 1, 2015.
Comment date: We will consider
comments that we receive by February
29, 2016.
ADDRESSES: We invite you to submit
comments on the rule. In your
comment, include the Regulation
Identifier Number (RIN), the volume,
date, and page number of this issue of
the Federal Register. You may submit
comments by any of the following
methods:
• Federal Rulemaking Portal: https://
www.regulations.gov. Follow the
instructions for submitting comments.
• Mail: Carrie L. Novak, Senior Loan
Officer, Loan Making Division, Deputy
Administrator for Farm Loan Programs,
FSA, U.S. Department of Agriculture,
1400 Independence Avenue SW., Stop
0522, Washington, DC 20250–0522.
Comments will be available online at
https://www.regulations.gov. A copy of
this rule is available through the FSA
home page at https://www.fsa.usda.gov/.
FOR FURTHER INFORMATION CONTACT:
Carrie Novak; telephone; (202) 720–
1643. Persons with disabilities or who
require alternative means for
communication should contact the
USDA Target Center at (202) 720–2600
(voice).
SUPPLEMENTARY INFORMATION:
SUMMARY:
Background
The HFIL Loan Program is authorized
by the section 5402 of the 2014 Farm
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Federal Register / Vol. 80, No. 230 / Tuesday, December 1, 2015 / Rules and Regulations
Bill (Pub. L. 113–79), which amended
25 U.S.C. 488 to allow the Secretary to
make and insure loans to intermediary
lenders to establish revolving loan funds
for the purchase of HFIL. FSA will loan
funds to intermediary lenders, who will
facilitate the purchase and
consolidation of fractionated interest by
relending the funds to qualified tribes,
individuals, and entities. FSA is adding
7 CFR part 769 to specify the
requirements for the HFIL Loan
Program. The rule provides a way for
tribes and tribal members to obtain
loans to purchase fractionated interests
via intermediary lenders. The
intermediary lenders will work with the
U.S. Department of Interior’s Bureau of
Indian Affairs (BIA) on the processes
and procedures needed for the ultimate
recipients to resolve the undivided
interests in the fractionated land. FSA
will provide a long term loan to the
intermediary lender and will review
their reports and agreement to provide
oversight of the lender’s loan process
and procedure; FSA will not provide
oversight for the ultimate recipients.
As a result of the General Allotment
Act of 1887 (also commonly known as
the Dawes Act), Indian reservation land
was allotted to individual tribal
members. When an allottee died, title
ownership was divided among his or
her heirs, but the land itself was not
partitioned and, as such, each Indian
heir received an undivided interest in
the land. As each generation passes, the
number of owners grows exponentially.
This has resulted in the highly
fractionated ownership of much of the
nation’s Indian land. As ownership of
Indian land descends from one
generation to another, the long standing
problem of fractionation continues to
worsen as many tracts are owned by
hundreds or even thousands of
individuals. The ability of the owners to
use land decreases as fractionation
increases, sometimes to the point where
it is nearly impossible to locate the
owners or for the known owners to
coordinate the use of the property. The
HFIL Loan Program will help encourage
intermediary lenders to provide loans to
individual tribal members in order to
resolve the highly fractionated
ownership of land.
To ensure the HFIL Loan Program
would have the greatest chance of
success, FSA held a Tribal Consultation
session on December 10, 2014.
Recommendations on issues discussed
during the Tribal Consultation have
been addressed in this rule.
Definitions
Some definitions in this rule originate
from other already established laws and
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regulations and are used here for
consistency. Indian Country uses the
definition in 18 U.S.C. 1151. ‘‘Native
American Tribe’’ and ‘‘Tribal Entity’’
definitions are consistent with 7 U.S.C.
770, ‘‘Indian Tribal Land Acquisition
Program.’’ HFIL will be defined as
undivided interests held by four or more
individuals. The definition in 25 U.S.C.
2201 defines highly fractionated as 50 or
more undivided owners. A less
constraining definition is needed for
this rule in order for the HFIL Loan
Program to effectively meet the
objectives of consolidating fractionated
interests. Tribal Consultation indicated
that not all fractionated parcels have 50
or more owners and using the strict
definition could exclude the parcels
from the HFIL Loan Program.
In addition, § 761.2 needs to be
revised to specify that the products of
tree farming and the products of other
plant and animal production are
agricultural commodities. Therefore,
this rule also revises the definition of
‘‘Agricultural Commodity’’ in § 761.2 as
a conforming change. The intention of
the list of items that are considered
agricultural commodities has not
changed; it is strictly correcting the
language in the definition.
Intermediary Lenders
Through Tribal Consultation, it
became apparent to FSA that the most
important characteristics of an
intermediary lender are the knowledge
and familiarity of working with Indian
Country and experience working with
BIA. The list of entities in § 769.103
should be flexible enough to include
any qualifying entity interested in
participating in the HFIL Loan Program.
FSA will develop guidelines for and
provide loan funds to the intermediary
lenders, who will facilitate the purchase
and consolidation of fractionated
interest by relending the funds to
qualified tribes, individuals, and
entities. FSA will establish criteria in
§ 769.103(b) and (c) for the intermediary
lender that will be tied to the
organization’s demonstrated skills,
ability, and knowledge of working with
Indian land. The intermediary lender
will establish eligibility criteria for the
ultimate recipient as restricted by this
rule in § 769.104.
An ultimate recipient is an entity or
individual that receives a loan from an
intermediary’s HFIL revolving fund. The
eligibility requirements of the ultimate
recipient in § 769.104 are restrictive
because this program is limited by the
provisions of the 2014 Farm Bill;
therefore, only Tribes, individual Tribal
members, and Tribal entities are eligible
to apply. In addition, the 2014 Farm Bill
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authorizes the HFIL Loan Program
under 25 U.S.C. 488 rather than the
Consolidated Farm and Rural
Development Act (CONACT, 7 U.S.C.
1911–2008r) where most FSA loan
programs are authorized. Accordingly,
the FSA loan is to the intermediary
lender as authorized under 25 U.S.C.
488 and the CONACT requirements
regarding credit elsewhere and
maximum loan amounts which typically
apply to applicants of the FSA Farm
Loan Programs do not apply to the
intermediary or the ultimate recipient.
Use of HFIL Loan Funds
The purposes of the HFIL Loan
Program are very specific and funds can
only be used for the purchase of HFIL
and related expenses as specified in
§§ 769.105 and 769.106.
The HFIL Loan Program is subject to
environmental compliance provisions
specified in 7 CFR part 1940, subpart G.
Accordingly, each intermediary lender
will provide FSA with documentation
of its process to address environmental
issues on the land to be purchased.
The Tribal Consultation resulted in
the strong recommendation that the
ultimate recipient be limited in use of
loan funds to purchasing land for an
agricultural use for the term of the loan.
The requirement to qualify for HFIL
loans is contained in this rule in
§ 769.106.
Intermediary Relending Agreement
The rate of interest for the
intermediary lender will be set
annually, but will not be less than 1
percent and the maximum HFIL loan
term is 30 years. The intermediary
lender will relend at a rate of interest
and term negotiated with the ultimate
recipient in a manner detailed in the
Intermediary Relending Agreement
approved by FSA.
The Intermediary Relending
Agreement will contain the policies and
procedures that the intermediary lender
will follow with respect to the loan and
the working relationship with the
ultimate recipients. This will provide
maximum flexibility for the
intermediary lender to work with its
ultimate recipient on loan making and
loan servicing and will be approved by
FSA prior to the HFIL loan closing. The
required elements of the agreement are
specified in § 769.103(d). The agreement
and requirements are similar to the
requirements in § 762.106 that must be
met by FSA guaranteed lenders seeking
certification as a preferred lender.
Revolving Loan Fund
An intermediary lender will be
required to have a revolving loan fund.
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All HFIL loan funds received by an
intermediary lender must be deposited
into an HFIL revolving fund account.
The account must be fully covered by
federal deposit insurance or fully
collateralized with U.S. Government
obligations and must remain separate
from other funds of the intermediary
lender. The fund will have two types of
deposit accounts, one of which will be
HFIL funds from FSA. The other will be
comprised of repayments of loans from
the ultimate recipients, interest earned
on funds in the account and cash, or
other short-term marketable assets that
the intermediary lender chooses to
deposit. Loans made to ultimate
recipients will be from both deposit
accounts within the revolving fund
account, and therefore, loans can be
made from initial loan funds from FSA
and from repayments. Administrative
fees and debt servicing costs will be
paid from funds accumulated from
repayments by ultimate recipients.
Maintenance of the fund is described in
§ 769.121.
Primary security for the HFIL Loan
Program will be in the form of a first
lien in the intermediary lender’s
revolving loan fund. Additional security
will be required if needed to fully
secure the loan.
FSA determined that yearly
monitoring reports would be both
necessary for the success of the program
and beneficial to the intermediary
lender. FSA did not want to be over
burdensome in the required type of
reporting or audits and therefore
adopted an approach similar to what
has been successfully used in the Boll
Weevil Eradication Loan Program in 7
CFR part 77.
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Transfer and Assumption of HFIL
Loans
This rule is adding § 769.124 to allow
for transfer and assumptions of the HFIL
loans in the event that an intermediary
lender should want or need to
discontinue participation in the HFIL
Loan Program.
Effective Date
The Administrative Procedure Act (5
U.S.C. 553) provides generally that
before rules are issued by Government
agencies, the rule is required to be
published in the Federal Register, and
the required publication of a substantive
rule is to be not less than 30 days before
its effective date. One of the exceptions
is when the agency finds good cause for
not delaying the effective date. This rule
is exempt from notice and comment
rulemaking requirements of the
Administrative Procedure Act (5 U.S.C.
553). The rule provides a way for tribes
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and tribal members to obtain loans to
purchase fractionated interests via
intermediary lenders as a way to help
resolve the longstanding problems
relating back to HFIL and will enable
tribal members to participate in USDA
programs that require land ownership.
As noted in this rule, FSA has
conducted Tribal consultation and will
take public comments following the
publication of this rule. Therefore, to
help tribal members as soon as possible,
using the administrative procedure
provisions in 5 U.S.C. 553, FSA finds
that there is good cause for making this
rule effective less than 30 days after
publication in the Federal Register.
This rule allows FSA to implement the
HFIL Loan Program in time for the 2016
fiscal year. Therefore, this final rule is
effective when published in the Federal
Register.
Executive Orders 12866 and 13563
Executive Order 12866, ‘‘Regulatory
Planning and Review,’’ and Executive
Order 13563, ‘‘Improving Regulation
and Regulatory Review,’’ direct agencies
to assess all costs and benefits of
available regulatory alternatives and, if
regulation is necessary, to select
regulatory approaches that maximize
net benefits (including potential
economic, environmental, public health
and safety effects, distributive impacts,
and equity). Executive Order 13563
emphasizes the importance of
quantifying both costs and benefits, of
reducing costs, of harmonizing rules,
and of promoting flexibility.
The Office of Management and Budget
(OMB) designated this rule as not
significant under Executive Order 12866
and, therefore, OMB has not reviewed
this final rule.
Regulatory Flexibility Act
The Regulatory Flexibility Act (5
U.S.C. 601–612), as amended by the
Small Business Regulatory Enforcement
Fairness Act of 1996 (SBREFA),
generally requires an agency to prepare
a regulatory flexibility analysis of any
rule whenever an agency is required by
the APA or any other law to publish a
proposed rule, unless the agency
certifies that the rule will not have a
significant economic impact on a
substantial number of small entities.
This rule is exempt from notice and
comment rulemaking requirements of
the APA and no other law requires that
a proposed rule be published for this
rulemaking initiative.
Environmental Review
The environmental impacts of this
rule have been considered in a manner
consistent with the provisions of the
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National Environmental Policy Act
(NEPA, 42 U.S.C. 4321–4347), the
regulations of the Council on
Environmental Quality (40 CFR parts
1500–1508), and the FSA regulations for
compliance with NEPA (7 CFR part
1940, subpart G). This rule is to
implement the new HFIL Loan Program,
a program created by the 2014 Farm
Bill. The discretionary provisions
needed to implement the HFIL Loan
Program, specifically those relating to
our loans to the intermediary lenders
include the loan making and servicing
rules, which will mirror present FLP
regulations. One discretionary provision
that will not mirror current FSA rules is
that implementation will be through an
intermediary lender that will relend the
funds, an approach that will be a new
lending tool for FSA. The process FSA
will use to administer the intermediary
lending model was vetted through and
determined to be acceptable by a Tribal
consultation, held on December 10,
2014, at the Intertribal Agricultural
Council annual meeting. As the
provisions needed to implement this
rule are all administrative in nature,
FSA will not prepare an environmental
assessment or environmental impact
statement for this regulatory action.
Executive Order 12372
Executive Order 12372,
‘‘Intergovernmental Review of Federal
Programs,’’ requires consultation with
State and local officials. The objectives
of the Executive Order are to foster an
intergovernmental partnership and a
strengthened Federalism, by relying on
State and local processes for State and
local government coordination and
review of proposed Federal Financial
assistance and direct Federal
development. For reasons set forth in
the final rule related notice regarding 7
CFR part 3015, subpart V (48 FR 29115,
June 24, 1983), the programs and
activities within this rule are excluded
from the scope of Executive Order
12372.
Executive Order 12988
This rule has been reviewed in
accordance with Executive Order 12988,
‘‘Civil Justice Reform.’’ This rule will
not preempt State or local laws,
regulations, or policies unless they
represent an irreconcilable conflict with
this rule. The rule does not have
retroactive effect. Before any judicial
action may be brought regarding the
provisions of this rule, the
administrative appeal provisions of 7
CFR parts 11 and 780 are to be
exhausted.
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Executive Order 13132
This rule has been reviewed under
Executive Order 13132, ‘‘Federalism.’’
The policies contained in this rule do
not have any substantial direct effect on
States, on the relationship between the
Federal Government and the States, or
on the distribution of power and
responsibilities among the various
levels of government. Nor would this
rule impose substantial direct
compliance costs on State and local
governments. Therefore, consultation
with the States is not required.
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FSA Farm Loan Programs also
participated in an additional seven
Tribal consultation sessions across the
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Executive Order 13175
This rule has been reviewed for
compliance with Executive Order
13175, ‘‘Consultation and Coordination
with Indian Tribal Governments.’’
Executive Order 13175 imposes
requirements on the development of
regulatory policies that have Tribal
implications or preempt Tribal laws.
The USDA Office of Tribal Relations has
concluded that the policies contained in
this rule do not, to USDA’s knowledge,
preempt Tribal law.
Rulemaking to address the issue of
HFIL was initially considered as part of
the implementation of the Food,
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Early on, during the 2008 Farm Bill
Tribal consultations, FSA heard the
various concerns that were raised and
thought a workable solution could still
be found to implement the HFIL Loan
Program; however, as additional
concerns continued to be raised and
differences were identified in other
regions of the country, it became clear
that one of the problems was that the
2008 Farm Bill provision was tied to the
BIA definition of highly fractionated
and as such would also be tied to the
BIA procedures for clearing titles, so it
was determined that a regulation would
not result in a successful program for
Indian country. FSA listened and heard
concerns about the land being too
fractionated, the process being too
complicated, the difficulties in really
understanding the issues that caused the
fractionation, problems with
consolidation, and related cultural
issues. In addition to the complexity of
the BIA process for clearing titles for
fractionated land, the results were
different across the country. In one
example, it took 6 months to clear a
title, in another example, clearing a title
took 10 years. There were suggestions
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August 3, 2010.
August 10, 2010.
August 24, 2010.
August 25, 2010.
August 30, 2010.
August 31, 2010.
September 7, 2010.
Tribal consultations were held in the
following locations on the following
dates:
Rapid City, SD .................................................................
Oklahoma City, OK ..........................................................
Minneapolis, MN ..............................................................
Seattle, WA ......................................................................
Nashville, TN ...................................................................
Albuquerque, NM .............................................................
Anchorage, AK .................................................................
that the HFIL Loan Program would work
if FSA worked with existing Native
American organizations that were
already established to consolidate
fractionated land and make it a
relending program.
As a direct result of everything that
FSA heard and learned throughout the
2008 Farm Bill Tribal consultations,
FSA provided input for the new
requirements in the 2014 Farm Bill to
work out a way to make the regulations
effective for Indian Country by
incorporating the option for an
intermediary lender to relend the funds
and remove the tie to the BIA definition
of highly fractionated.
For the development of this rule, a
Tribal consultation was held on
December 10, 2014, at the Intertribal
Agricultural Council annual meeting.
The participants in the Tribal
consultation have strongly supported
the HFIL Loan Program. During the
Tribal consultation, FSA staff asked for
and received feedback on the following
proposed provisions of the HFIL Loan
Program.
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Conservation, and Energy Act of 2008
(Pub. L. 110–246, known as the 2008
Farm Bill). An HFIL loan program was
authorized by the 2008 Farm Bill;
however, the language required that the
program operate as a direct loan
program in which FSA would make
loans directly to the ultimate recipients.
During 2010, USDA held two sets of
face-to-face Tribal consultation sessions
across the country. FSA Farm Loan
Programs held seven Tribal consultation
sessions specifically to discuss the HFIL
Loan Program (section 5501 of the 2008
Farm Bill) in the following locations on
the following dates:
Washington DC ................................................................
Pendleton, OR .................................................................
Billings, MT ......................................................................
Rapid City, SD .................................................................
Oklahoma City, OK ..........................................................
Albuquerque, NM .............................................................
Fairbanks, AK ..................................................................
country to discuss the 2008 Farm Bill
changes, including the HFIL Loan
Program. The USDA 2008 Farm Bill
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October 28 to 29, 2010.
November 3 to 4, 2010.
November 8 to 9, 2010.
November 22 to 23, 2010.
November 29 to 30, 2010.
December 1 to 2, 2010.
December 13 to 14, 2010.
HFIL Proposed Provision: Should the
HFIL Loan Program be administered as
a relending program?
Tribal Consultation Response: Yes.
HFIL Proposed Provision: Should
there be a minimum number of acres
consolidated with the HFIL Loan
Program?
Tribal Consultation Response: No.
HFIL Proposed Provision: Should
there be a limited number of
intermediary lenders?
Tribal Consultation Response: Yes,
given the limited amount of funds,
approved intermediary lenders should
be limited to no more than two lenders
per year.
HFIL Proposed Provision: Should
there be any restrictions to the use of
funds under the HFIL Loan Program?
Tribal Consultation Response: Yes,
funds should be used only for the
consolidation of agricultural land.
During the 90-day comment period for
this rule, FSA will schedule additional
Tribal consultation on the HFIL Loan
Program. Although FSA is making this
rule effective on publication, FSA will
work on changes to the regulation as
needed based on comments and
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additional input from Tribal
consultation.
In addition, to developing the HFIL
Loan Program, FSA will continue to
engage with Tribal organizations to
ensure HFIL Loan Program rules are
consistent with Tribal laws and so that
the HFIL Loan Program has a maximum
opportunity for success. USDA will
continue to coordinate with Tribal
governmental organizations concerning
this rule and will provide appropriate
venues, such as webinars and
teleconferences, to host collaborative
conversations with Tribal leaders and
their representatives concerning ways to
improve this rule in Indian country.
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Unfunded Mandates Reform Act
Title II of the Unfunded Mandate
Reform Act of 1995 (UMRA, Pub. L.
104–4) requires Federal agencies to
assess the effects of their regulatory
actions on State, local, or Tribal
governments or the private sector.
Agencies generally must prepare a
written statement, including a cost
benefit analysis, for proposed and final
rules with Federal mandates that may
result in expenditures of $100 million or
more in any 1 year for State, local, or
Tribal governments, in the aggregate, or
to the private sector. UMRA generally
requires agencies to consider
alternatives and adopt the more cost
effective or least burdensome alternative
that achieves the objectives of the rule.
This rule contains no Federal mandates
under the regulatory provisions of Title
II of the Unfunded Mandates Reform
Act of 1995 for State, local, or Tribal
governments, or the private sector.
Therefore, this rule is not subject to the
requirements of sections 202 and 205 of
UMRA.
Paperwork Reduction Act
FSA will not be collecting any
information from the ultimate recipients
in the HFIL Loan Program. There are
some reporting requirements on the
HFIL Loan Program activities from
intermediary lenders to FSA. The
intermediary lenders must allow FSA to
review the ultimate recipients’ records;
the intermediary lenders maintain the
records are expected to be a part of
customary and usual business practices
for the process of loans. Therefore, the
burden associated with recordkeeping is
excluded. The intermediary lenders will
be an entity that meets certain criteria
to be established by FSA such as: Has
been active in the previous 5 years, and
has expertise in technical assistance, is
an established financial organization
which is regulated by an acceptable
state or federal regulatory agency, meets
certain capital requirements, and ability
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to work with the Bureau of Indian
Affairs (BIA). FSA will lend funds to an
eligible entity, which will then relend
directly to a Tribe or an individual.
There are limited entities that will
qualify to be intermediary lenders for
the HFIL Loan Program. The current
annual allocation of $10 million will not
sufficiently fund multiple
intermediaries. For the HFIL Loan
Program to be effective adequate funds
must be available for each intermediary
lender to borrow to relend. As discussed
above, at the Tribal Consultation held
on December 10, 2014, members in
attendance strongly suggested that HFIL
Loan Program be restricted to no more
than 2 intermediary lenders per year for
funding due to limited funding. FSA
expects to have less than 10
intermediary lenders eligible to
participate in the HFIL Loan Program
annually. Therefore, this would not
require OMB approval under the
Paperwork Reduction Act of 1995 (44
U.S.C. 3501–3520).
E-Government Act Compliance
FSA is committed to complying with
the E-Government Act, to promote the
use of the Internet and other
information technologies to provide
increased opportunities for citizen
access to Government information and
services, and for other purposes.
List of Subjects
7 CFR Part 769
Loan program-Agriculture, Indians,
Land.
For the reasons discussed above, FSA
amends 7 CFR chapter VII as follows:
PART 761—FARM LOAN PROGRAM;
GENERAL PROGRAM
ADMINISTRATION
1. The authority citation for part 761
continues to read as follows:
■
Authority: 5 U.S.C. 301 and 7 U.S.C. 1989.
Subpart A—General Provisions
2. Amend § 761.2 as follows:
a. In the introductory text, add ‘‘and
769’’ immediately after ‘‘767’’; and
■ b. In paragraph (b), revise the
definition of ‘‘Agricultural commodity’’.
The revision reads as follows:
■
■
Abbreviations and definitions.
*
*
*
*
*
(b) * * *
Agricultural commodity means
livestock, grains, cotton, oilseeds, dry
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PART 769—HIGHLY FRACTIONATED
INDIAN LAND LOAN PROGRAM
Sec.
769.101 Purpose.
769.102 Abbreviations and definitions.
769.103 Eligibility requirements of the
intermediary lender.
769.104 Requirements of the ultimate
recipient.
769.105 Authorized loan purposes.
769.106 Limitations.
769.107 Rates and terms.
769.108 Security requirements for HFIL
loans and ultimate recipients.
769.109 Intermediary lender’s application.
769.110 Letter of conditions.
769.111 Loan approval and obligating
funds.
769.120 Loan closing.
769.121 Maintenance and monitoring of
HFIL revolving fund.
769.122 Loan servicing.
769.123 Transfer and assumption.
769.124 Appeals.
769.125 Exceptions.
Authority: 5 U.S.C. 301, 7 U.S.C. 1989, and
25 U.S.C. 488.
§ 769.101
7 CFR Part 761
Accounting, Loan programsagriculture, Rural areas.
§ 761.2
beans, tobacco, peanuts, sugar beets,
sugar cane, fruit, vegetable, forage,
nursery crops, nuts, aquacultural
species, and the products resulting
from: livestock, tree farming, and other
plant or animal production as
determined by the Agency.
*
*
*
*
*
■ 3. Add part 769 to read as follows:
Purpose.
(a) This part contains regulations for
loans made by the Agency to eligible
intermediary lenders and applies to
intermediary lenders and ultimate
recipient involved in making and
servicing Highly Fractionated Indian
Land (HFIL) loans.
(b) The purpose of the HFIL Loan
Program is to establish policies and
procedures for a revolving loan fund
through intermediary lenders for the
purchase of HFIL by a Native American
tribe, tribal entity, or member of either.
§ 769.102
Abbreviations and definitions
(a) Abbreviations. The following
abbreviations are used in this part:
BIA—The Department of the Interior’s
Bureau of Indian Affairs (BIA).
HFIL—Highly Fractionated Indian Land.
(b) Definitions. The following
definitions are used in this part:
Administrator means the head of the
Farm Service Agency or designee.
Highly Fractionated Indian Land
(HFIL) means for the purpose of this part
only, Highly Fractionated Indian Land
is undivided interests held by four or
more individuals as a result of
ownership or original allotments
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passing by state laws of intestate
succession for multiple generations.
Indian Country land, communities,
and allotments means the following:
(1) All land within the limits of any
Indian reservation under the
jurisdiction of the U.S. Government,
notwithstanding the issuance of any
patent, and, including rights-of-way
running through the reservation,
(2) All dependent Indian communities
within the borders of the United States
whether within the original or
subsequently acquired territory thereof,
and whether within or without the
limits of a state, and
(3) All Indian allotments, the Indian
titles to which have not been
extinguished, including rights-of-way
running through the same; or
(4) All land, communities, and
allotments that meet the definition of 18
U.S.C. 1151.
Intermediary lender means the entity
requesting or receiving HFIL loan funds
for establishing a revolving fund and
relending to ultimate recipients.
Intermediary relending agreement
means the signed agreement between
FSA and the intermediary that specifies
the terms and conditions of the HFIL
loan.
Native American tribe means the
following:
(1) An Indian tribe recognized by the
U.S. Department of the Interior; or
(2) A community in Alaska
incorporated by the U.S. Department of
the Interior pursuant to the Indian
Reorganization Act.
Revolving funds means a fund that
has two types of deposit accounts, one
of which will be HFIL funds from FSA
and the other will be comprised of
repayments of loans from the ultimate
recipients, interest earned on funds in
the account and cash, or other shortterm marketable assets that the
intermediary lender chooses to deposit.
Revolving funds are not considered
Federal funds.
Tribal entity means an eligible entity
established pursuant to the Indian
Reorganization Act.
Ultimate recipient means Native
American tribe, tribal entity, or member
of either that receives a loan from an
intermediary lender’s HFIL revolving
fund.
Undivided interest means a common
interest in the whole parcel of land that
is owned by two or more people.
Owners of undivided interest do not
own a specific piece of a parcel of land;
rather they own a percentage interest in
the whole.
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§ 769.103 Eligibility requirements of the
intermediary lender.
(a) Eligible entity types. The types of
entities that may become an
intermediary lender are:
(1) Private and Tribal operated
nonprofit corporations;
(2) Public agencies—Any State or
local government, or any branch or
agency of such government having
authority to act on behalf of that
government, borrow funds, and engage
in activities eligible for funding under
this part;
(3) Indian tribes or tribal corporations;
or
(4) Lenders who are subject to credit
examination and supervision by an
acceptable State or Federal regulatory
agency.
(b) Intermediary lender requirements.
The intermediary lender must:
(1) Have the legal authority necessary
for carrying out the proposed loan
purposes and for obtaining, giving
security for, and repaying the proposed
loan;
(2) Have a record of successful
lending in Indian Country and
knowledge and experience working
with the BIA. The Agency will assess
the applicant staff’s training and
experience in lending in Indian Country
based on recent experience in loan
making and servicing with loans that are
similar in nature to the HFIL program.
If consultants will be used, FSA will
assess the staff’s experience in choosing
and supervising consultants; and
(3) Have an adequate assurance of
repayment of the loan based on the
fiscal and managerial capabilities of the
proposed intermediary lender.
(c) The Intermediary Relending
Agreement. The intermediary lender
and the Agency will enter into an
Intermediary Relending Agreement,
satisfactory to the Agency based on:
(1) Loan documentation requirements
including planned application forms,
security instruments, and loan closing
documents;
(2) List of proposed fees and other
charges it will assess the ultimate
recipients;
(3) The plan for relending the loan
funds. The plan must have sufficient
detail to provide the Agency with a
complete understanding of the complete
mechanics of how the funds will get
from the intermediary lender to the
ultimate recipient. Included in the plan
are the service area, eligibility criteria,
loan purposes, rates, terms, collateral
requirements, a process for addressing
environmental issues on property to be
purchased, limits, priorities, application
process, analysis of new loan requests,
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and method of disbursement of the
funds to the ultimate recipient;
(4) Loan review plans that specify
how the intermediary lender will review
the loan request from the ultimate
recipient and make an eligibility
determination;
(5) An explanation of the
intermediary lender’s established
internal credit review process; and
(6) An explanation of how the
intermediary lender will monitor the
loans to the ultimate recipients.
§ 769.104 Requirements of the ultimate
recipient.
(a) Ultimate recipients must be
individual Tribal members, Tribes or
eligible Tribal entities, with authority to
incur the debt and carry out the purpose
of the loan.
(b) The intermediary lender will make
this determination in accordance with
the Intermediary Relending Agreement.
§ 769.105
Authorized loan purposes.
(a) Intermediary lender. Agency HFIL
loan funds must be placed in the
intermediary’s HFIL revolving fund and
used by the intermediary to provide
direct loans to eligible ultimate
recipients.
(b) Ultimate recipient. Loans from the
intermediary lender to the ultimate
recipient using the HFIL revolving fund:
(1) Must be used to acquire and
consolidate at least 50 percent of the
highly fractionated Indian land parcel
and interests in the land. The interests
include rights-of-way, water rights,
easements, and other appurtenances
that would normally pass with the land
or are necessary for the proposed
operation of the land located within the
tribe’s reservation;
(2) Must finance land that will be
used for agricultural purposes during
the term of the loan;
(3) May be used to pay costs
incidental to land acquisition,
including, but not limited to, title
clearance, legal services, archeological
or land surveys, and loan closing; and
(4) May be used to pay for the costs
of any appraisal conducted in
accordance with this part.
§ 769.106
Limitations.
(a) Loan funds may not be used for
any land improvement or development
purposes, acquisition or repair of
buildings or personal property, payment
of operating costs, payment of finders’
fees, or similar costs, or for any purpose
that will contribute to excessive erosion
of highly erodible land or to the
conversion of wetlands to produce an
agricultural commodity as specified in 7
CFR part 12.
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(b) The amount of loan funds used to
acquire land may not exceed the current
market value of the land as determined
by a current appraisal that meets the
requirements as specified in 7 CFR
761.7(b)(1).
(c) Agency HFIL loan funds may not
be used for payment of the
intermediary’s administrative costs or
expenses. The amount removed from
the HFIL revolving fund for
administrative costs in any year must be
reasonable, must not exceed the actual
cost of operating the HFIL revolving
fund and must not exceed the amount
approved by the Agency in the
intermediary lender’s annual loan
monitoring report.
(d) No loan to an intermediary lender
may exceed the maximum amount the
intermediary can reasonably expect to
lend to eligible ultimate recipients,
based on anticipated demand for loans
to consolidate fractioned interests and
capacity of the intermediary to
effectively carry out the terms of the
loan.
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§ 769.107
Rates and terms.
(a) Loans made by the Agency to the
intermediary lender will bear interest at
a fixed rate as determined by the
Administrator, but not less than 1
percent per year over the term of the
loan.
(1) Interest rates charged by
intermediary lender to ultimate
recipients on loans from the HFIL
revolving fund will be negotiated
between the intermediary lender and
ultimate recipient, but the rate must be
within limits established by the
Intermediary Relending Agreement.
(2) The rate should normally be the
lowest rate sufficient to cover the loan’s
proportional share of the revolving
fund’s debt service costs and
administrative costs.
(b) No loan to an intermediary lender
will be extended for a period exceeding
30 years. Interest will be due annually
but principal payments may be deferred
by the Agency.
(1) Loans made by an intermediary
lender to an ultimate recipient from the
HFIL revolving fund will be scheduled
for repayment over a term negotiated by
the intermediary lender and ultimate
recipient but will not exceed 30 years or
the date of the end of the term of the
HFIL loan, whichever is sooner.
(2) The term of an HFIL loan must be
reasonable and prudent considering the
purpose of the loan, expected
repayment ability of the ultimate
recipient, and the useful life of
collateral, and must be within any limits
established by the intermediary lender’s
Intermediary Relending Agreement.
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§ 769.108 Security requirements for HFIL
loans and the ultimate recipients.
(a) HFIL loans. Security for all loans
to intermediaries must be such that the
repayment of the loan is reasonably
assured, taking into consideration the
intermediary’s financial condition,
Intermediary Relending Agreement, and
management ability. The intermediary is
responsible to make loans to ultimate
recipients in such a manner that will
fully protect the interest of the
intermediary and the Government. The
Agency will require adequate security,
as determined by the Agency, to fully
secure the loan, including but not
limited to the following:
(1) Assignments of assessments, taxes,
levies, or other sources of revenue as
authorized by law;
(2) Investments and deposits of the
intermediary; and
(3) Capital assets or other property of
the intermediary and its members.
(b) Liens. In addition to normal
security documents, a first lien interest
in the intermediary’s revolving fund
account will be accomplished by a
control agreement satisfactory to the
Agency. The control agreement does not
require the Agency’s signature for
withdrawals. The depository bank must
waive its offset and recoupment rights
against the depository account to the
Agency and subordinate any liens it
may have against the HFIL depository
bank account.
(c) Ultimate recipient. Security for a
loan from an intermediary lender’s HFIL
revolving fund to an ultimate recipient
will be adequate to fully secure the loan
as specified in the relending agreement.
(1) The Agency will only require
concurrence in the intermediary
lender’s security requirement for a
specific loan when security for the loan
from the intermediary lender to the
ultimate recipient will also serve as
security for an Agency loan.
(2) The ultimate recipient will take
appropriate action to obtain and provide
security for the loan.
§ 769.109 Intermediary lender’s
application.
(a) The application will consist of:
(1) An application form provided by
the Agency;
(2) A draft Intermediary Relending
Agreement and other evidence the
Agency requires to show the feasibility
of the intermediary lender’s program to
meet the objectives of the HFIL Loan
Program; and
(3) Applications from intermediary
lenders that already have an active HFIL
loan may be streamlined by filing a new
application and a statement that the
new loan would be operated in
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accordance with the Intermediary
Relending Agreement on file for the
previous loan. This statement may be
submitted at the time of application in
lieu of a new Intermediary Relending
Agreement.
(4) Documentation of the intermediary
lender’s ability to administer HFIL in
accordance with this part;
(5) Submission of a completed Agency
application form;
(6) Prior to approval of a loan or
advance of funds, certification of
whether or not the intermediary lender
is delinquent on any Federal debt,
including, but not limited to, Federal
income tax obligations or a loan or loan
guarantee or from another Federal
agency. If delinquent, the intermediate
lender must explain the reasons for the
delinquency, and the Agency will take
such written explanation into
consideration in deciding whether to
approve the loan or advance of funds;
(7) Prior to approval of a loan or
advance of funds, certification as to
whether the intermediary lender has
been convicted of a felony criminal
violation under Federal law in the 24
months preceding the date of
application.
(8) Certification of compliance with
the restrictions and requirements in 31
U.S.C. 1352, and 2 CFR 200.450 and
part 418.
(9) Certification to having been
informed of the collection options the
Federal government may use to collect
delinquent debt.
(b) An intermediary lender that has
received one or more HFIL loans may
apply for and be considered for
subsequent HFIL loans provided:
(1) The intermediary lender is
relending all collections from loans
made from its revolving fund in excess
of what is needed for required debt
service, approved administration costs,
and a reserve for debt service;
(2) The outstanding loans of the
intermediary lender’s HFIL revolving
fund are performing; and
(3) The intermediary lender is in
compliance with all regulations and its
loan agreements with the Agency.
§ 769.110
Letter of conditions.
(a) The Agency will provide the
intermediary lender a letter listing all
requirements for the loan. After
reviewing the conditions and
requirements in the letter of conditions,
the intermediary lender must complete,
sign, and return the form provided by
the Agency indicating the intermediary
lender’s intent to meet the conditions. If
certain conditions cannot be met, the
intermediary lender may propose
alternate conditions in writing to the
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Agency. The Agency loan approval
official must concur with any changes
made to the initially issued or proposed
letter of conditions prior to acceptance.
The loan request will be withdrawn if
the intermediary lender does not
respond within 15 days.
(b) At loan closing, the intermediary
lender must certify that:
(1) No major changes have been made
in the Intermediary Relending
Agreement except those approved in the
interim by the Agency;
(2) All requirements of the letter of
conditions have been met; and
(3) There has been no material change
in the intermediary lender or its
financial condition since the issuance of
the letter of conditions. If there have
been changes, the intermediary lender
must explain the changes to the Agency.
The changes may be waived, at the sole
discretion of the Agency.
§ 769.111
funds.
Loan approval and obligating
(a) Loan requests will be processed
based on the date the Agency receives
the application. Loan approval is subject
to the availability of funds.
(b) The loan will be considered
approved for the intermediary lender on
the date the signed copy of the
obligation of funds document is mailed
to the intermediary lender.
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§ 769.120
Loan closing.
(a) Loan agreement. A loan agreement
or supplement to a previous loan
agreement must be executed by the
intermediary lender and the Agency at
loan closing for each loan setting forth,
at a minimum,
(1) The amount of the loan, the
interest rate, the term and repayment
schedule,
(2) The requirement to maintain a
separate ledger and segregated account
for the HFIL revolving fund; and
(3) It agrees to comply with Agency
reporting requirements.
(b) Loan closing. Intermediary lenders
receiving HFIL loans will be governed
by this part, the loan agreement, the
approved Intermediary Relending
Agreement, security instruments, and
any other conditions that the Agency
requires on loans made from the ‘‘HFIL
revolving fund.’’ The requirement
applies to all loans made by an
intermediary lender to an ultimate
recipient from the intermediary lender’s
HFIL revolving fund for as long as any
portion of the intermediary lender’s
HFIL loan from the Agency remains
unpaid.
(c) Intermediary lender certification.
The intermediary lender must include
in their file a certification that:
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(1) The proposed ultimate recipient is
eligible for the loan;
(2) The proposed loan is for eligible
purposes; and
(3) The proposed loan complies with
all applicable laws and regulations.
§ 769.121 Maintenance and monitoring of
HFIL revolving fund.
(a) Maintenance of revolving fund.
The intermediary lender must maintain
the HFIL revolving fund until all of its
HFIL obligations have been paid in full.
All HFIL loan funds received by an
intermediary lender must be deposited
into an HFIL revolving fund account.
Such accounts must be fully covered by
Federal deposit insurance or fully
collateralized with U.S. Government
obligations. All cash of the HFIL
revolving fund must be deposited in a
separate bank account or accounts so as
not to be commingled with other
financial assets of the intermediary
lender. All money deposited in such
bank account or accounts must be
security assets of the HFIL revolving
fund. Loans to ultimate recipients must
be from the HFIL revolving fund.
(1) The portion of the HFIL revolving
fund that consists of Agency HFIL loan
funds may only be used for making
loans in accordance with § 769.105. The
portion of the HFIL revolving fund that
consists of repayments from ultimate
recipients may be used for debt service,
reasonable administrative costs, or for
making additional loans;
(2) An intermediary lender may use
revolving funds and HFIL loan funds to
make loans to ultimate recipients
without obtaining prior Agency
concurrence in accordance with the
Intermediary Relending Agreement;
(3) Any funds in the HFIL revolving
fund from any source that is not needed
for debt service, approved
administrative costs, or reasonable
reserves must be available for additional
loans to ultimate recipients;
(4) All reserves and other funds in the
HFIL revolving loan fund not
immediately needed for loans to
ultimate recipients or other authorized
uses must be deposited in accounts in
banks or other financial institutions.
Such accounts must be fully covered by
Federal deposit insurance or fully
collateralized with U.S. Government
obligations, and will be interest bearing.
Any interest earned thereon remains a
part of the HFIL revolving fund;
(5) If an intermediary lender receives
more than one HFIL loan, it does not
need to establish and maintain a
separate HFIL revolving loan fund for
each loan; it may combine them and
maintain only one HFIL revolving fund,
unless the Agency requires separate
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HFIL revolving funds because there are
significant differences in the loan
purposes, Intermediary Relending
Agreement, loan agreements, or
requirements for the loans; and
(6) A reasonable amount of revolved
funds must be used to create a reserve
for bad debts. Reserves should be
accumulated over a period of years. The
total amount should not exceed
maximum expected losses, considering
the quality of the intermediary lender’s
portfolio of loans. Unless the
intermediary lender provides loss and
delinquency records that, in the opinion
of the Agency, justifies different
amounts, a reserve for bad debts of 6
percent of outstanding loans must be
accumulated over 5 years and then
maintained.
(b) Loan monitoring reviews. The
intermediary lender must complete loan
monitoring reviews, including annual
and periodic reviews, and performance
monitoring.
(1) At least annually, the intermediary
lender must provide the Agency
documents for the purpose of reviewing
the financial status of the intermediary
Lender, assessing the progress of
utilizing loan funds, and identifying any
potential problems or concerns. Nonregulated intermediary lenders must
furnish audited financial statements at
least annually.
(2) At any time the Agency
determines it is necessary, the
intermediary lender must allow the
Agency or its representative to review
the operations and financial condition
of the intermediary lender. Upon the
Agency requests, the Intermediary must
submit financial or other information
within 14 days unless the data
requested is not available within that
time frame.
(c) Progress reports. Each
intermediary lender will be monitored
by the Agency based on progress reports
submitted by the intermediary lender,
audit findings, disbursement
transactions, visitations, and other
contact with the intermediary lender as
necessary.
§ 769.122
Loan servicing.
(a) Payments. Payments will be made
to the Agency as specified in loan
agreements and debt instruments. The
funds from any extra payments will be
applied entirely to loan principal.
(b) Restructuring. The Agency may
restructure the intermediary lender’s
loan debt, if:
(1) The Government’s interest will be
protected;
(2) The restructuring will be
performed within the Agency’s budget
authority; and
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§ 769.125
§ 769.123
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(3) The loan objectives cannot be met
unless the HFIL loan is restructured.
(c) Default. In the event of monetary
or non-monetary default, the Agency
will take all appropriate actions to
protect its interest, including, but not
limited to, declaring the debt fully due
and payable and may proceed to enforce
its rights under the loan agreement or
any other loan instruments relating to
the loan under applicable law and
regulations, and commencement of legal
action to protect the Agency’s interest.
The Agency will work with the
intermediary lender to correct any
default, subject to the requirements of
paragraph (b) of this section. Violation
of any agreement with the Agency or
failure to comply with reporting or other
program requirements will be
considered non-monetary default.
[NRC–2015–0239]
Transfer and assumption.
(a) All transfers and assumptions
must be approved in advance in writing
by the Agency. The assuming entity
must meet all eligibility criteria for the
HFIL Loan Program.
(b) Available transfer and assumption
options to eligible intermediary lenders
include the following:
(1) The total indebtedness may be
transferred to another eligible
intermediary lender on the same terms;
or
(2) The total indebtedness may be
transferred to another eligible
intermediary lender on different terms
not to exceed the term for which an
initial loan can be made. The assuming
entity must meet all eligibility criteria
for the HFIL Loan Program.
(c) The transferor must prepare the
transfer document for the Agency
review prior to the transfer and
assumption.
(d) The transferee must provide the
Agency with information required in the
application as specified in § 769.109.
(e) The Agency prepared assumption
agreement will contain the Agency case
number of the transferor and transferee.
(f) The transferee must complete an
application as specified in § 769.109(a).
(g) When the transferee makes a cash
down-payment in connection with the
transfer and assumption, any proceeds
received by the transferor will be
credited on the transferor’s loan debt in
order of maturity date.
(h) The Administrator or designee
will approve or decline all transfers and
assumptions.
§ 769.124
Appeals.
Any appealable adverse decision
made by the Agency may be appealed
upon written request of the
intermediary as specified in 7 CFR part
11.
VerDate Sep<11>2014
18:38 Nov 30, 2015
Jkt 238001
Exceptions.
The Agency may grant an exception to
any of the requirements of this part if
the proposed change is in the best
financial interest of the Government and
not inconsistent with the authorizing
law or any other applicable law.
Val Dolcini,
Administrator, Farm Service Agency.
[FR Doc. 2015–30331 Filed 11–30–15; 8:45 am]
BILLING CODE 3410–05–P
NUCLEAR REGULATORY
COMMISSION
10 CFR Parts 1, 2, 4, 7, 9, 11, 15, 19,
20, 21, 25, 26, 30, 32, 37, 40, 50, 51, 52,
55, 60, 61, 62, 63, 70, 71, 72, 73, 74, 76,
81, 95, 100, 110, 140, 150, 170, and 171
RIN 3150–AJ69
Miscellaneous Corrections
Nuclear Regulatory
Commission.
ACTION: Final rule.
AGENCY:
The U.S. Nuclear Regulatory
Commission (NRC) is amending its
regulations to make miscellaneous
corrections. These changes include
renaming the Office of Information
Services, renaming the Computer
Security Office and removing it as a
standalone office, capitalizing the words
Tribe, Tribes, and Tribal, correcting a
Web site address, correcting a
misspelling, removing a submission
requirement, correcting an email
address, correcting a room number,
removing a Federal Register notice
requirement, and adding missing
information collection references. This
document is necessary to inform the
public of these non-substantive changes
to the NRC’s regulations.
DATES: This rule is effective December
31, 2015.
ADDRESSES: Please refer to Docket ID
NRC–2015–0239 when contacting the
NRC about the availability of
information for this final rule. You may
obtain publicly-available information
related to this final rule by any of the
following methods:
• Federal Rulemaking Web site: Go to
https://www.regulations.gov and search
for Docket ID NRC–2015–0239. Address
questions about NRC dockets to Carol
Gallagher; telephone: 301–415–3463;
email: Carol.Gallagher@nrc.gov. For
technical questions, please contact the
individual listed in the FOR FURTHER
INFORMATION CONTACT section of this
final rule.
SUMMARY:
PO 00000
Frm 00010
Fmt 4700
Sfmt 4700
• NRC’s Agencywide Documents
Access and Management System
(ADAMS):
You may obtain publicly-available
documents online in the ADAMS Public
Documents collection at https://
www.nrc.gov/reading-rm/adams.html.
To begin the search, select ‘‘ADAMS
Public Documents’’ and then select
‘‘Begin Web-based ADAMS Search.’’ For
problems with ADAMS, please contact
the NRC’s Public Document Room (PDR)
reference staff at 1–800–397–4209, 301–
415–4737, or by email to pdr.resource@
nrc.gov. The ADAMS accession number
for each document referenced (if it
available in ADAMS) is provided the
first time that a document is referenced.
• NRC’s PDR: You may examine and
purchase copies of public documents at
the NRC’s PDR, Room O1–F21, One
White Flint North, 11555 Rockville
Pike, Rockville, Maryland 20852.
FOR FURTHER INFORMATION CONTACT: Jill
Shepherd-Vladimir, Office of
Administration, telephone: 301–415–
1230, email: Jill.Shepherd@nrc.gov; U.S.
Nuclear Regulatory Commission,
Washington, DC 20555–0001.
SUPPLEMENTARY INFORMATION:
I. Introduction
The NRC is amending its regulations
in parts 1, 2, 4, 7, 9, 11, 15, 19, 20, 21,
25, 26, 30, 32, 37, 40, 50, 51, 52, 55, 60,
61, 62, 63, 70, 71, 72, 73, 74, 76, 81, 95,
100, 110, 140, 150, 170, and 171 of title
10 of the Code of Federal Regulations
(10 CFR) to make miscellaneous
corrections. These changes include
renaming the Office of Information
Services, renaming the Computer
Security Office and removing it as a
standalone office, capitalizing the words
Tribe, Tribes, and Tribal, correcting a
Web site address, correcting a
misspelling, removing a submission
requirement, correcting an email
address, correcting a room number,
removing a Federal Register notice
requirement, and adding missing
information collection references. This
document is necessary to inform the
public of these non-substantive changes
to the NRC’s regulations.
II. Summary of Changes
10 CFR Part 1
Remove Office. This final rule
removes and reserves § 1.38. The
Computer Security Office has been
renamed the Information Security
Directorate and will now be part of the
Office of the Chief Information Officer.
The Information Security Directorate
information is now included as new
paragraphs (h) through (l) under § 1.35.
Additional editorial changes have been
E:\FR\FM\01DER1.SGM
01DER1
]]>Agencies
[Federal Register Volume 80, Number 230 (Tuesday, December 1, 2015)]
[Rules and Regulations]
[Pages 74966-74974]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2015-30331]
-----------------------------------------------------------------------
DEPARTMENT OF AGRICULTURE
Farm Service Agency
7 CFR Parts 761 and 769
RIN 0560-AI32
Highly Fractionated Indian Land (HFIL) Loan Program
AGENCY: Farm Service Agency, USDA.
ACTION: Final rule.
-----------------------------------------------------------------------
SUMMARY: The Farm Service Agency (FSA) is implementing the HFIL Loan
Program to provide revolving loan funds to eligible intermediary
lenders familiar with Indian Lands. The intermediary lenders will
provide loan funds to qualified individuals, entities, and tribes to
purchase highly fractionated Indian land consistent with the
Agricultural Act of 2014 (2014 Farm Bill). FSA is also requesting
public comments on the rule.
DATES: Effective date: December 1, 2015.
Comment date: We will consider comments that we receive by February
29, 2016.
ADDRESSES: We invite you to submit comments on the rule. In your
comment, include the Regulation Identifier Number (RIN), the volume,
date, and page number of this issue of the Federal Register. You may
submit comments by any of the following methods:
Federal Rulemaking Portal: https://www.regulations.gov.
Follow the instructions for submitting comments.
Mail: Carrie L. Novak, Senior Loan Officer, Loan Making
Division, Deputy Administrator for Farm Loan Programs, FSA, U.S.
Department of Agriculture, 1400 Independence Avenue SW., Stop 0522,
Washington, DC 20250-0522.
Comments will be available online at https://www.regulations.gov. A
copy of this rule is available through the FSA home page at https://www.fsa.usda.gov/.
FOR FURTHER INFORMATION CONTACT: Carrie Novak; telephone; (202) 720-
1643. Persons with disabilities or who require alternative means for
communication should contact the USDA Target Center at (202) 720-2600
(voice).
SUPPLEMENTARY INFORMATION:
Background
The HFIL Loan Program is authorized by the section 5402 of the 2014
Farm
[[Page 74967]]
Bill (Pub. L. 113-79), which amended 25 U.S.C. 488 to allow the
Secretary to make and insure loans to intermediary lenders to establish
revolving loan funds for the purchase of HFIL. FSA will loan funds to
intermediary lenders, who will facilitate the purchase and
consolidation of fractionated interest by relending the funds to
qualified tribes, individuals, and entities. FSA is adding 7 CFR part
769 to specify the requirements for the HFIL Loan Program. The rule
provides a way for tribes and tribal members to obtain loans to
purchase fractionated interests via intermediary lenders. The
intermediary lenders will work with the U.S. Department of Interior's
Bureau of Indian Affairs (BIA) on the processes and procedures needed
for the ultimate recipients to resolve the undivided interests in the
fractionated land. FSA will provide a long term loan to the
intermediary lender and will review their reports and agreement to
provide oversight of the lender's loan process and procedure; FSA will
not provide oversight for the ultimate recipients.
As a result of the General Allotment Act of 1887 (also commonly
known as the Dawes Act), Indian reservation land was allotted to
individual tribal members. When an allottee died, title ownership was
divided among his or her heirs, but the land itself was not partitioned
and, as such, each Indian heir received an undivided interest in the
land. As each generation passes, the number of owners grows
exponentially. This has resulted in the highly fractionated ownership
of much of the nation's Indian land. As ownership of Indian land
descends from one generation to another, the long standing problem of
fractionation continues to worsen as many tracts are owned by hundreds
or even thousands of individuals. The ability of the owners to use land
decreases as fractionation increases, sometimes to the point where it
is nearly impossible to locate the owners or for the known owners to
coordinate the use of the property. The HFIL Loan Program will help
encourage intermediary lenders to provide loans to individual tribal
members in order to resolve the highly fractionated ownership of land.
To ensure the HFIL Loan Program would have the greatest chance of
success, FSA held a Tribal Consultation session on December 10, 2014.
Recommendations on issues discussed during the Tribal Consultation have
been addressed in this rule.
Definitions
Some definitions in this rule originate from other already
established laws and regulations and are used here for consistency.
Indian Country uses the definition in 18 U.S.C. 1151. ``Native American
Tribe'' and ``Tribal Entity'' definitions are consistent with 7 U.S.C.
770, ``Indian Tribal Land Acquisition Program.'' HFIL will be defined
as undivided interests held by four or more individuals. The definition
in 25 U.S.C. 2201 defines highly fractionated as 50 or more undivided
owners. A less constraining definition is needed for this rule in order
for the HFIL Loan Program to effectively meet the objectives of
consolidating fractionated interests. Tribal Consultation indicated
that not all fractionated parcels have 50 or more owners and using the
strict definition could exclude the parcels from the HFIL Loan Program.
In addition, Sec. 761.2 needs to be revised to specify that the
products of tree farming and the products of other plant and animal
production are agricultural commodities. Therefore, this rule also
revises the definition of ``Agricultural Commodity'' in Sec. 761.2 as
a conforming change. The intention of the list of items that are
considered agricultural commodities has not changed; it is strictly
correcting the language in the definition.
Intermediary Lenders
Through Tribal Consultation, it became apparent to FSA that the
most important characteristics of an intermediary lender are the
knowledge and familiarity of working with Indian Country and experience
working with BIA. The list of entities in Sec. 769.103 should be
flexible enough to include any qualifying entity interested in
participating in the HFIL Loan Program.
FSA will develop guidelines for and provide loan funds to the
intermediary lenders, who will facilitate the purchase and
consolidation of fractionated interest by relending the funds to
qualified tribes, individuals, and entities. FSA will establish
criteria in Sec. 769.103(b) and (c) for the intermediary lender that
will be tied to the organization's demonstrated skills, ability, and
knowledge of working with Indian land. The intermediary lender will
establish eligibility criteria for the ultimate recipient as restricted
by this rule in Sec. 769.104.
An ultimate recipient is an entity or individual that receives a
loan from an intermediary's HFIL revolving fund. The eligibility
requirements of the ultimate recipient in Sec. 769.104 are restrictive
because this program is limited by the provisions of the 2014 Farm
Bill; therefore, only Tribes, individual Tribal members, and Tribal
entities are eligible to apply. In addition, the 2014 Farm Bill
authorizes the HFIL Loan Program under 25 U.S.C. 488 rather than the
Consolidated Farm and Rural Development Act (CONACT, 7 U.S.C. 1911-
2008r) where most FSA loan programs are authorized. Accordingly, the
FSA loan is to the intermediary lender as authorized under 25 U.S.C.
488 and the CONACT requirements regarding credit elsewhere and maximum
loan amounts which typically apply to applicants of the FSA Farm Loan
Programs do not apply to the intermediary or the ultimate recipient.
Use of HFIL Loan Funds
The purposes of the HFIL Loan Program are very specific and funds
can only be used for the purchase of HFIL and related expenses as
specified in Sec. Sec. 769.105 and 769.106.
The HFIL Loan Program is subject to environmental compliance
provisions specified in 7 CFR part 1940, subpart G. Accordingly, each
intermediary lender will provide FSA with documentation of its process
to address environmental issues on the land to be purchased.
The Tribal Consultation resulted in the strong recommendation that
the ultimate recipient be limited in use of loan funds to purchasing
land for an agricultural use for the term of the loan. The requirement
to qualify for HFIL loans is contained in this rule in Sec. 769.106.
Intermediary Relending Agreement
The rate of interest for the intermediary lender will be set
annually, but will not be less than 1 percent and the maximum HFIL loan
term is 30 years. The intermediary lender will relend at a rate of
interest and term negotiated with the ultimate recipient in a manner
detailed in the Intermediary Relending Agreement approved by FSA.
The Intermediary Relending Agreement will contain the policies and
procedures that the intermediary lender will follow with respect to the
loan and the working relationship with the ultimate recipients. This
will provide maximum flexibility for the intermediary lender to work
with its ultimate recipient on loan making and loan servicing and will
be approved by FSA prior to the HFIL loan closing. The required
elements of the agreement are specified in Sec. 769.103(d). The
agreement and requirements are similar to the requirements in Sec.
762.106 that must be met by FSA guaranteed lenders seeking
certification as a preferred lender.
Revolving Loan Fund
An intermediary lender will be required to have a revolving loan
fund.
[[Page 74968]]
All HFIL loan funds received by an intermediary lender must be
deposited into an HFIL revolving fund account. The account must be
fully covered by federal deposit insurance or fully collateralized with
U.S. Government obligations and must remain separate from other funds
of the intermediary lender. The fund will have two types of deposit
accounts, one of which will be HFIL funds from FSA. The other will be
comprised of repayments of loans from the ultimate recipients, interest
earned on funds in the account and cash, or other short-term marketable
assets that the intermediary lender chooses to deposit. Loans made to
ultimate recipients will be from both deposit accounts within the
revolving fund account, and therefore, loans can be made from initial
loan funds from FSA and from repayments. Administrative fees and debt
servicing costs will be paid from funds accumulated from repayments by
ultimate recipients. Maintenance of the fund is described in Sec.
769.121.
Primary security for the HFIL Loan Program will be in the form of a
first lien in the intermediary lender's revolving loan fund. Additional
security will be required if needed to fully secure the loan.
FSA determined that yearly monitoring reports would be both
necessary for the success of the program and beneficial to the
intermediary lender. FSA did not want to be over burdensome in the
required type of reporting or audits and therefore adopted an approach
similar to what has been successfully used in the Boll Weevil
Eradication Loan Program in 7 CFR part 77.
Transfer and Assumption of HFIL Loans
This rule is adding Sec. 769.124 to allow for transfer and
assumptions of the HFIL loans in the event that an intermediary lender
should want or need to discontinue participation in the HFIL Loan
Program.
Effective Date
The Administrative Procedure Act (5 U.S.C. 553) provides generally
that before rules are issued by Government agencies, the rule is
required to be published in the Federal Register, and the required
publication of a substantive rule is to be not less than 30 days before
its effective date. One of the exceptions is when the agency finds good
cause for not delaying the effective date. This rule is exempt from
notice and comment rulemaking requirements of the Administrative
Procedure Act (5 U.S.C. 553). The rule provides a way for tribes and
tribal members to obtain loans to purchase fractionated interests via
intermediary lenders as a way to help resolve the longstanding problems
relating back to HFIL and will enable tribal members to participate in
USDA programs that require land ownership. As noted in this rule, FSA
has conducted Tribal consultation and will take public comments
following the publication of this rule. Therefore, to help tribal
members as soon as possible, using the administrative procedure
provisions in 5 U.S.C. 553, FSA finds that there is good cause for
making this rule effective less than 30 days after publication in the
Federal Register. This rule allows FSA to implement the HFIL Loan
Program in time for the 2016 fiscal year. Therefore, this final rule is
effective when published in the Federal Register.
Executive Orders 12866 and 13563
Executive Order 12866, ``Regulatory Planning and Review,'' and
Executive Order 13563, ``Improving Regulation and Regulatory Review,''
direct agencies to assess all costs and benefits of available
regulatory alternatives and, if regulation is necessary, to select
regulatory approaches that maximize net benefits (including potential
economic, environmental, public health and safety effects, distributive
impacts, and equity). Executive Order 13563 emphasizes the importance
of quantifying both costs and benefits, of reducing costs, of
harmonizing rules, and of promoting flexibility.
The Office of Management and Budget (OMB) designated this rule as
not significant under Executive Order 12866 and, therefore, OMB has not
reviewed this final rule.
Regulatory Flexibility Act
The Regulatory Flexibility Act (5 U.S.C. 601-612), as amended by
the Small Business Regulatory Enforcement Fairness Act of 1996
(SBREFA), generally requires an agency to prepare a regulatory
flexibility analysis of any rule whenever an agency is required by the
APA or any other law to publish a proposed rule, unless the agency
certifies that the rule will not have a significant economic impact on
a substantial number of small entities. This rule is exempt from notice
and comment rulemaking requirements of the APA and no other law
requires that a proposed rule be published for this rulemaking
initiative.
Environmental Review
The environmental impacts of this rule have been considered in a
manner consistent with the provisions of the National Environmental
Policy Act (NEPA, 42 U.S.C. 4321-4347), the regulations of the Council
on Environmental Quality (40 CFR parts 1500-1508), and the FSA
regulations for compliance with NEPA (7 CFR part 1940, subpart G). This
rule is to implement the new HFIL Loan Program, a program created by
the 2014 Farm Bill. The discretionary provisions needed to implement
the HFIL Loan Program, specifically those relating to our loans to the
intermediary lenders include the loan making and servicing rules, which
will mirror present FLP regulations. One discretionary provision that
will not mirror current FSA rules is that implementation will be
through an intermediary lender that will relend the funds, an approach
that will be a new lending tool for FSA. The process FSA will use to
administer the intermediary lending model was vetted through and
determined to be acceptable by a Tribal consultation, held on December
10, 2014, at the Intertribal Agricultural Council annual meeting. As
the provisions needed to implement this rule are all administrative in
nature, FSA will not prepare an environmental assessment or
environmental impact statement for this regulatory action.
Executive Order 12372
Executive Order 12372, ``Intergovernmental Review of Federal
Programs,'' requires consultation with State and local officials. The
objectives of the Executive Order are to foster an intergovernmental
partnership and a strengthened Federalism, by relying on State and
local processes for State and local government coordination and review
of proposed Federal Financial assistance and direct Federal
development. For reasons set forth in the final rule related notice
regarding 7 CFR part 3015, subpart V (48 FR 29115, June 24, 1983), the
programs and activities within this rule are excluded from the scope of
Executive Order 12372.
Executive Order 12988
This rule has been reviewed in accordance with Executive Order
12988, ``Civil Justice Reform.'' This rule will not preempt State or
local laws, regulations, or policies unless they represent an
irreconcilable conflict with this rule. The rule does not have
retroactive effect. Before any judicial action may be brought regarding
the provisions of this rule, the administrative appeal provisions of 7
CFR parts 11 and 780 are to be exhausted.
[[Page 74969]]
Executive Order 13132
This rule has been reviewed under Executive Order 13132,
``Federalism.'' The policies contained in this rule do not have any
substantial direct effect on States, on the relationship between the
Federal Government and the States, or on the distribution of power and
responsibilities among the various levels of government. Nor would this
rule impose substantial direct compliance costs on State and local
governments. Therefore, consultation with the States is not required.
Executive Order 13175
This rule has been reviewed for compliance with Executive Order
13175, ``Consultation and Coordination with Indian Tribal
Governments.'' Executive Order 13175 imposes requirements on the
development of regulatory policies that have Tribal implications or
preempt Tribal laws. The USDA Office of Tribal Relations has concluded
that the policies contained in this rule do not, to USDA's knowledge,
preempt Tribal law.
Rulemaking to address the issue of HFIL was initially considered as
part of the implementation of the Food, Conservation, and Energy Act of
2008 (Pub. L. 110-246, known as the 2008 Farm Bill). An HFIL loan
program was authorized by the 2008 Farm Bill; however, the language
required that the program operate as a direct loan program in which FSA
would make loans directly to the ultimate recipients. During 2010, USDA
held two sets of face-to-face Tribal consultation sessions across the
country. FSA Farm Loan Programs held seven Tribal consultation sessions
specifically to discuss the HFIL Loan Program (section 5501 of the 2008
Farm Bill) in the following locations on the following dates:
----------------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------
1...................................... Washington DC............. August 3, 2010.
2...................................... Pendleton, OR............. August 10, 2010.
3...................................... Billings, MT.............. August 24, 2010.
4...................................... Rapid City, SD............ August 25, 2010.
5...................................... Oklahoma City, OK......... August 30, 2010.
6...................................... Albuquerque, NM........... August 31, 2010.
7...................................... Fairbanks, AK............. September 7, 2010.
----------------------------------------------------------------------------------------------------------------
FSA Farm Loan Programs also participated in an additional seven
Tribal consultation sessions across the country to discuss the 2008
Farm Bill changes, including the HFIL Loan Program. The USDA 2008 Farm
Bill Tribal consultations were held in the following locations on the
following dates:
----------------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------
1...................................... Rapid City, SD............ October 28 to 29, 2010.
2...................................... Oklahoma City, OK......... November 3 to 4, 2010.
3...................................... Minneapolis, MN........... November 8 to 9, 2010.
4...................................... Seattle, WA............... November 22 to 23, 2010.
5...................................... Nashville, TN............. November 29 to 30, 2010.
6...................................... Albuquerque, NM........... December 1 to 2, 2010.
7...................................... Anchorage, AK............. December 13 to 14, 2010.
----------------------------------------------------------------------------------------------------------------
Early on, during the 2008 Farm Bill Tribal consultations, FSA heard
the various concerns that were raised and thought a workable solution
could still be found to implement the HFIL Loan Program; however, as
additional concerns continued to be raised and differences were
identified in other regions of the country, it became clear that one of
the problems was that the 2008 Farm Bill provision was tied to the BIA
definition of highly fractionated and as such would also be tied to the
BIA procedures for clearing titles, so it was determined that a
regulation would not result in a successful program for Indian country.
FSA listened and heard concerns about the land being too fractionated,
the process being too complicated, the difficulties in really
understanding the issues that caused the fractionation, problems with
consolidation, and related cultural issues. In addition to the
complexity of the BIA process for clearing titles for fractionated
land, the results were different across the country. In one example, it
took 6 months to clear a title, in another example, clearing a title
took 10 years. There were suggestions that the HFIL Loan Program would
work if FSA worked with existing Native American organizations that
were already established to consolidate fractionated land and make it a
relending program.
As a direct result of everything that FSA heard and learned
throughout the 2008 Farm Bill Tribal consultations, FSA provided input
for the new requirements in the 2014 Farm Bill to work out a way to
make the regulations effective for Indian Country by incorporating the
option for an intermediary lender to relend the funds and remove the
tie to the BIA definition of highly fractionated.
For the development of this rule, a Tribal consultation was held on
December 10, 2014, at the Intertribal Agricultural Council annual
meeting. The participants in the Tribal consultation have strongly
supported the HFIL Loan Program. During the Tribal consultation, FSA
staff asked for and received feedback on the following proposed
provisions of the HFIL Loan Program.
HFIL Proposed Provision: Should the HFIL Loan Program be
administered as a relending program?
Tribal Consultation Response: Yes.
HFIL Proposed Provision: Should there be a minimum number of acres
consolidated with the HFIL Loan Program?
Tribal Consultation Response: No.
HFIL Proposed Provision: Should there be a limited number of
intermediary lenders?
Tribal Consultation Response: Yes, given the limited amount of
funds, approved intermediary lenders should be limited to no more than
two lenders per year.
HFIL Proposed Provision: Should there be any restrictions to the
use of funds under the HFIL Loan Program?
Tribal Consultation Response: Yes, funds should be used only for
the consolidation of agricultural land.
During the 90-day comment period for this rule, FSA will schedule
additional Tribal consultation on the HFIL Loan Program. Although FSA
is making this rule effective on publication, FSA will work on changes
to the regulation as needed based on comments and
[[Page 74970]]
additional input from Tribal consultation.
In addition, to developing the HFIL Loan Program, FSA will continue
to engage with Tribal organizations to ensure HFIL Loan Program rules
are consistent with Tribal laws and so that the HFIL Loan Program has a
maximum opportunity for success. USDA will continue to coordinate with
Tribal governmental organizations concerning this rule and will provide
appropriate venues, such as webinars and teleconferences, to host
collaborative conversations with Tribal leaders and their
representatives concerning ways to improve this rule in Indian country.
Unfunded Mandates Reform Act
Title II of the Unfunded Mandate Reform Act of 1995 (UMRA, Pub. L.
104-4) requires Federal agencies to assess the effects of their
regulatory actions on State, local, or Tribal governments or the
private sector. Agencies generally must prepare a written statement,
including a cost benefit analysis, for proposed and final rules with
Federal mandates that may result in expenditures of $100 million or
more in any 1 year for State, local, or Tribal governments, in the
aggregate, or to the private sector. UMRA generally requires agencies
to consider alternatives and adopt the more cost effective or least
burdensome alternative that achieves the objectives of the rule. This
rule contains no Federal mandates under the regulatory provisions of
Title II of the Unfunded Mandates Reform Act of 1995 for State, local,
or Tribal governments, or the private sector. Therefore, this rule is
not subject to the requirements of sections 202 and 205 of UMRA.
Paperwork Reduction Act
FSA will not be collecting any information from the ultimate
recipients in the HFIL Loan Program. There are some reporting
requirements on the HFIL Loan Program activities from intermediary
lenders to FSA. The intermediary lenders must allow FSA to review the
ultimate recipients' records; the intermediary lenders maintain the
records are expected to be a part of customary and usual business
practices for the process of loans. Therefore, the burden associated
with recordkeeping is excluded. The intermediary lenders will be an
entity that meets certain criteria to be established by FSA such as:
Has been active in the previous 5 years, and has expertise in technical
assistance, is an established financial organization which is regulated
by an acceptable state or federal regulatory agency, meets certain
capital requirements, and ability to work with the Bureau of Indian
Affairs (BIA). FSA will lend funds to an eligible entity, which will
then relend directly to a Tribe or an individual. There are limited
entities that will qualify to be intermediary lenders for the HFIL Loan
Program. The current annual allocation of $10 million will not
sufficiently fund multiple intermediaries. For the HFIL Loan Program to
be effective adequate funds must be available for each intermediary
lender to borrow to relend. As discussed above, at the Tribal
Consultation held on December 10, 2014, members in attendance strongly
suggested that HFIL Loan Program be restricted to no more than 2
intermediary lenders per year for funding due to limited funding. FSA
expects to have less than 10 intermediary lenders eligible to
participate in the HFIL Loan Program annually. Therefore, this would
not require OMB approval under the Paperwork Reduction Act of 1995 (44
U.S.C. 3501-3520).
E-Government Act Compliance
FSA is committed to complying with the E-Government Act, to promote
the use of the Internet and other information technologies to provide
increased opportunities for citizen access to Government information
and services, and for other purposes.
List of Subjects
7 CFR Part 761
Accounting, Loan programs-agriculture, Rural areas.
7 CFR Part 769
Loan program-Agriculture, Indians, Land.
For the reasons discussed above, FSA amends 7 CFR chapter VII as
follows:
PART 761--FARM LOAN PROGRAM; GENERAL PROGRAM ADMINISTRATION
0
1. The authority citation for part 761 continues to read as follows:
Authority: 5 U.S.C. 301 and 7 U.S.C. 1989.
Subpart A--General Provisions
0
2. Amend Sec. 761.2 as follows:
0
a. In the introductory text, add ``and 769'' immediately after ``767'';
and
0
b. In paragraph (b), revise the definition of ``Agricultural
commodity''.
The revision reads as follows:
Sec. 761.2 Abbreviations and definitions.
* * * * *
(b) * * *
Agricultural commodity means livestock, grains, cotton, oilseeds,
dry beans, tobacco, peanuts, sugar beets, sugar cane, fruit, vegetable,
forage, nursery crops, nuts, aquacultural species, and the products
resulting from: livestock, tree farming, and other plant or animal
production as determined by the Agency.
* * * * *
0
3. Add part 769 to read as follows:
PART 769--HIGHLY FRACTIONATED INDIAN LAND LOAN PROGRAM
Sec.
769.101 Purpose.
769.102 Abbreviations and definitions.
769.103 Eligibility requirements of the intermediary lender.
769.104 Requirements of the ultimate recipient.
769.105 Authorized loan purposes.
769.106 Limitations.
769.107 Rates and terms.
769.108 Security requirements for HFIL loans and ultimate
recipients.
769.109 Intermediary lender's application.
769.110 Letter of conditions.
769.111 Loan approval and obligating funds.
769.120 Loan closing.
769.121 Maintenance and monitoring of HFIL revolving fund.
769.122 Loan servicing.
769.123 Transfer and assumption.
769.124 Appeals.
769.125 Exceptions.
Authority: 5 U.S.C. 301, 7 U.S.C. 1989, and 25 U.S.C. 488.
Sec. 769.101 Purpose.
(a) This part contains regulations for loans made by the Agency to
eligible intermediary lenders and applies to intermediary lenders and
ultimate recipient involved in making and servicing Highly Fractionated
Indian Land (HFIL) loans.
(b) The purpose of the HFIL Loan Program is to establish policies
and procedures for a revolving loan fund through intermediary lenders
for the purchase of HFIL by a Native American tribe, tribal entity, or
member of either.
Sec. 769.102 Abbreviations and definitions
(a) Abbreviations. The following abbreviations are used in this
part:
BIA--The Department of the Interior's Bureau of Indian Affairs (BIA).
HFIL--Highly Fractionated Indian Land.
(b) Definitions. The following definitions are used in this part:
Administrator means the head of the Farm Service Agency or
designee.
Highly Fractionated Indian Land (HFIL) means for the purpose of
this part only, Highly Fractionated Indian Land is undivided interests
held by four or more individuals as a result of ownership or original
allotments
[[Page 74971]]
passing by state laws of intestate succession for multiple generations.
Indian Country land, communities, and allotments means the
following:
(1) All land within the limits of any Indian reservation under the
jurisdiction of the U.S. Government, notwithstanding the issuance of
any patent, and, including rights-of-way running through the
reservation,
(2) All dependent Indian communities within the borders of the
United States whether within the original or subsequently acquired
territory thereof, and whether within or without the limits of a state,
and
(3) All Indian allotments, the Indian titles to which have not been
extinguished, including rights-of-way running through the same; or
(4) All land, communities, and allotments that meet the definition
of 18 U.S.C. 1151.
Intermediary lender means the entity requesting or receiving HFIL
loan funds for establishing a revolving fund and relending to ultimate
recipients.
Intermediary relending agreement means the signed agreement between
FSA and the intermediary that specifies the terms and conditions of the
HFIL loan.
Native American tribe means the following:
(1) An Indian tribe recognized by the U.S. Department of the
Interior; or
(2) A community in Alaska incorporated by the U.S. Department of
the Interior pursuant to the Indian Reorganization Act.
Revolving funds means a fund that has two types of deposit
accounts, one of which will be HFIL funds from FSA and the other will
be comprised of repayments of loans from the ultimate recipients,
interest earned on funds in the account and cash, or other short-term
marketable assets that the intermediary lender chooses to deposit.
Revolving funds are not considered Federal funds.
Tribal entity means an eligible entity established pursuant to the
Indian Reorganization Act.
Ultimate recipient means Native American tribe, tribal entity, or
member of either that receives a loan from an intermediary lender's
HFIL revolving fund.
Undivided interest means a common interest in the whole parcel of
land that is owned by two or more people. Owners of undivided interest
do not own a specific piece of a parcel of land; rather they own a
percentage interest in the whole.
Sec. 769.103 Eligibility requirements of the intermediary lender.
(a) Eligible entity types. The types of entities that may become an
intermediary lender are:
(1) Private and Tribal operated nonprofit corporations;
(2) Public agencies--Any State or local government, or any branch
or agency of such government having authority to act on behalf of that
government, borrow funds, and engage in activities eligible for funding
under this part;
(3) Indian tribes or tribal corporations; or
(4) Lenders who are subject to credit examination and supervision
by an acceptable State or Federal regulatory agency.
(b) Intermediary lender requirements. The intermediary lender must:
(1) Have the legal authority necessary for carrying out the
proposed loan purposes and for obtaining, giving security for, and
repaying the proposed loan;
(2) Have a record of successful lending in Indian Country and
knowledge and experience working with the BIA. The Agency will assess
the applicant staff's training and experience in lending in Indian
Country based on recent experience in loan making and servicing with
loans that are similar in nature to the HFIL program. If consultants
will be used, FSA will assess the staff's experience in choosing and
supervising consultants; and
(3) Have an adequate assurance of repayment of the loan based on
the fiscal and managerial capabilities of the proposed intermediary
lender.
(c) The Intermediary Relending Agreement. The intermediary lender
and the Agency will enter into an Intermediary Relending Agreement,
satisfactory to the Agency based on:
(1) Loan documentation requirements including planned application
forms, security instruments, and loan closing documents;
(2) List of proposed fees and other charges it will assess the
ultimate recipients;
(3) The plan for relending the loan funds. The plan must have
sufficient detail to provide the Agency with a complete understanding
of the complete mechanics of how the funds will get from the
intermediary lender to the ultimate recipient. Included in the plan are
the service area, eligibility criteria, loan purposes, rates, terms,
collateral requirements, a process for addressing environmental issues
on property to be purchased, limits, priorities, application process,
analysis of new loan requests, and method of disbursement of the funds
to the ultimate recipient;
(4) Loan review plans that specify how the intermediary lender will
review the loan request from the ultimate recipient and make an
eligibility determination;
(5) An explanation of the intermediary lender's established
internal credit review process; and
(6) An explanation of how the intermediary lender will monitor the
loans to the ultimate recipients.
Sec. 769.104 Requirements of the ultimate recipient.
(a) Ultimate recipients must be individual Tribal members, Tribes
or eligible Tribal entities, with authority to incur the debt and carry
out the purpose of the loan.
(b) The intermediary lender will make this determination in
accordance with the Intermediary Relending Agreement.
Sec. 769.105 Authorized loan purposes.
(a) Intermediary lender. Agency HFIL loan funds must be placed in
the intermediary's HFIL revolving fund and used by the intermediary to
provide direct loans to eligible ultimate recipients.
(b) Ultimate recipient. Loans from the intermediary lender to the
ultimate recipient using the HFIL revolving fund:
(1) Must be used to acquire and consolidate at least 50 percent of
the highly fractionated Indian land parcel and interests in the land.
The interests include rights-of-way, water rights, easements, and other
appurtenances that would normally pass with the land or are necessary
for the proposed operation of the land located within the tribe's
reservation;
(2) Must finance land that will be used for agricultural purposes
during the term of the loan;
(3) May be used to pay costs incidental to land acquisition,
including, but not limited to, title clearance, legal services,
archeological or land surveys, and loan closing; and
(4) May be used to pay for the costs of any appraisal conducted in
accordance with this part.
Sec. 769.106 Limitations.
(a) Loan funds may not be used for any land improvement or
development purposes, acquisition or repair of buildings or personal
property, payment of operating costs, payment of finders' fees, or
similar costs, or for any purpose that will contribute to excessive
erosion of highly erodible land or to the conversion of wetlands to
produce an agricultural commodity as specified in 7 CFR part 12.
[[Page 74972]]
(b) The amount of loan funds used to acquire land may not exceed
the current market value of the land as determined by a current
appraisal that meets the requirements as specified in 7 CFR
761.7(b)(1).
(c) Agency HFIL loan funds may not be used for payment of the
intermediary's administrative costs or expenses. The amount removed
from the HFIL revolving fund for administrative costs in any year must
be reasonable, must not exceed the actual cost of operating the HFIL
revolving fund and must not exceed the amount approved by the Agency in
the intermediary lender's annual loan monitoring report.
(d) No loan to an intermediary lender may exceed the maximum amount
the intermediary can reasonably expect to lend to eligible ultimate
recipients, based on anticipated demand for loans to consolidate
fractioned interests and capacity of the intermediary to effectively
carry out the terms of the loan.
Sec. 769.107 Rates and terms.
(a) Loans made by the Agency to the intermediary lender will bear
interest at a fixed rate as determined by the Administrator, but not
less than 1 percent per year over the term of the loan.
(1) Interest rates charged by intermediary lender to ultimate
recipients on loans from the HFIL revolving fund will be negotiated
between the intermediary lender and ultimate recipient, but the rate
must be within limits established by the Intermediary Relending
Agreement.
(2) The rate should normally be the lowest rate sufficient to cover
the loan's proportional share of the revolving fund's debt service
costs and administrative costs.
(b) No loan to an intermediary lender will be extended for a period
exceeding 30 years. Interest will be due annually but principal
payments may be deferred by the Agency.
(1) Loans made by an intermediary lender to an ultimate recipient
from the HFIL revolving fund will be scheduled for repayment over a
term negotiated by the intermediary lender and ultimate recipient but
will not exceed 30 years or the date of the end of the term of the HFIL
loan, whichever is sooner.
(2) The term of an HFIL loan must be reasonable and prudent
considering the purpose of the loan, expected repayment ability of the
ultimate recipient, and the useful life of collateral, and must be
within any limits established by the intermediary lender's Intermediary
Relending Agreement.
Sec. 769.108 Security requirements for HFIL loans and the ultimate
recipients.
(a) HFIL loans. Security for all loans to intermediaries must be
such that the repayment of the loan is reasonably assured, taking into
consideration the intermediary's financial condition, Intermediary
Relending Agreement, and management ability. The intermediary is
responsible to make loans to ultimate recipients in such a manner that
will fully protect the interest of the intermediary and the Government.
The Agency will require adequate security, as determined by the Agency,
to fully secure the loan, including but not limited to the following:
(1) Assignments of assessments, taxes, levies, or other sources of
revenue as authorized by law;
(2) Investments and deposits of the intermediary; and
(3) Capital assets or other property of the intermediary and its
members.
(b) Liens. In addition to normal security documents, a first lien
interest in the intermediary's revolving fund account will be
accomplished by a control agreement satisfactory to the Agency. The
control agreement does not require the Agency's signature for
withdrawals. The depository bank must waive its offset and recoupment
rights against the depository account to the Agency and subordinate any
liens it may have against the HFIL depository bank account.
(c) Ultimate recipient. Security for a loan from an intermediary
lender's HFIL revolving fund to an ultimate recipient will be adequate
to fully secure the loan as specified in the relending agreement.
(1) The Agency will only require concurrence in the intermediary
lender's security requirement for a specific loan when security for the
loan from the intermediary lender to the ultimate recipient will also
serve as security for an Agency loan.
(2) The ultimate recipient will take appropriate action to obtain
and provide security for the loan.
Sec. 769.109 Intermediary lender's application.
(a) The application will consist of:
(1) An application form provided by the Agency;
(2) A draft Intermediary Relending Agreement and other evidence the
Agency requires to show the feasibility of the intermediary lender's
program to meet the objectives of the HFIL Loan Program; and
(3) Applications from intermediary lenders that already have an
active HFIL loan may be streamlined by filing a new application and a
statement that the new loan would be operated in accordance with the
Intermediary Relending Agreement on file for the previous loan. This
statement may be submitted at the time of application in lieu of a new
Intermediary Relending Agreement.
(4) Documentation of the intermediary lender's ability to
administer HFIL in accordance with this part;
(5) Submission of a completed Agency application form;
(6) Prior to approval of a loan or advance of funds, certification
of whether or not the intermediary lender is delinquent on any Federal
debt, including, but not limited to, Federal income tax obligations or
a loan or loan guarantee or from another Federal agency. If delinquent,
the intermediate lender must explain the reasons for the delinquency,
and the Agency will take such written explanation into consideration in
deciding whether to approve the loan or advance of funds;
(7) Prior to approval of a loan or advance of funds, certification
as to whether the intermediary lender has been convicted of a felony
criminal violation under Federal law in the 24 months preceding the
date of application.
(8) Certification of compliance with the restrictions and
requirements in 31 U.S.C. 1352, and 2 CFR 200.450 and part 418.
(9) Certification to having been informed of the collection options
the Federal government may use to collect delinquent debt.
(b) An intermediary lender that has received one or more HFIL loans
may apply for and be considered for subsequent HFIL loans provided:
(1) The intermediary lender is relending all collections from loans
made from its revolving fund in excess of what is needed for required
debt service, approved administration costs, and a reserve for debt
service;
(2) The outstanding loans of the intermediary lender's HFIL
revolving fund are performing; and
(3) The intermediary lender is in compliance with all regulations
and its loan agreements with the Agency.
Sec. 769.110 Letter of conditions.
(a) The Agency will provide the intermediary lender a letter
listing all requirements for the loan. After reviewing the conditions
and requirements in the letter of conditions, the intermediary lender
must complete, sign, and return the form provided by the Agency
indicating the intermediary lender's intent to meet the conditions. If
certain conditions cannot be met, the intermediary lender may propose
alternate conditions in writing to the
[[Page 74973]]
Agency. The Agency loan approval official must concur with any changes
made to the initially issued or proposed letter of conditions prior to
acceptance. The loan request will be withdrawn if the intermediary
lender does not respond within 15 days.
(b) At loan closing, the intermediary lender must certify that:
(1) No major changes have been made in the Intermediary Relending
Agreement except those approved in the interim by the Agency;
(2) All requirements of the letter of conditions have been met; and
(3) There has been no material change in the intermediary lender or
its financial condition since the issuance of the letter of conditions.
If there have been changes, the intermediary lender must explain the
changes to the Agency. The changes may be waived, at the sole
discretion of the Agency.
Sec. 769.111 Loan approval and obligating funds.
(a) Loan requests will be processed based on the date the Agency
receives the application. Loan approval is subject to the availability
of funds.
(b) The loan will be considered approved for the intermediary
lender on the date the signed copy of the obligation of funds document
is mailed to the intermediary lender.
Sec. 769.120 Loan closing.
(a) Loan agreement. A loan agreement or supplement to a previous
loan agreement must be executed by the intermediary lender and the
Agency at loan closing for each loan setting forth, at a minimum,
(1) The amount of the loan, the interest rate, the term and
repayment schedule,
(2) The requirement to maintain a separate ledger and segregated
account for the HFIL revolving fund; and
(3) It agrees to comply with Agency reporting requirements.
(b) Loan closing. Intermediary lenders receiving HFIL loans will be
governed by this part, the loan agreement, the approved Intermediary
Relending Agreement, security instruments, and any other conditions
that the Agency requires on loans made from the ``HFIL revolving
fund.'' The requirement applies to all loans made by an intermediary
lender to an ultimate recipient from the intermediary lender's HFIL
revolving fund for as long as any portion of the intermediary lender's
HFIL loan from the Agency remains unpaid.
(c) Intermediary lender certification. The intermediary lender must
include in their file a certification that:
(1) The proposed ultimate recipient is eligible for the loan;
(2) The proposed loan is for eligible purposes; and
(3) The proposed loan complies with all applicable laws and
regulations.
Sec. 769.121 Maintenance and monitoring of HFIL revolving fund.
(a) Maintenance of revolving fund. The intermediary lender must
maintain the HFIL revolving fund until all of its HFIL obligations have
been paid in full. All HFIL loan funds received by an intermediary
lender must be deposited into an HFIL revolving fund account. Such
accounts must be fully covered by Federal deposit insurance or fully
collateralized with U.S. Government obligations. All cash of the HFIL
revolving fund must be deposited in a separate bank account or accounts
so as not to be commingled with other financial assets of the
intermediary lender. All money deposited in such bank account or
accounts must be security assets of the HFIL revolving fund. Loans to
ultimate recipients must be from the HFIL revolving fund.
(1) The portion of the HFIL revolving fund that consists of Agency
HFIL loan funds may only be used for making loans in accordance with
Sec. 769.105. The portion of the HFIL revolving fund that consists of
repayments from ultimate recipients may be used for debt service,
reasonable administrative costs, or for making additional loans;
(2) An intermediary lender may use revolving funds and HFIL loan
funds to make loans to ultimate recipients without obtaining prior
Agency concurrence in accordance with the Intermediary Relending
Agreement;
(3) Any funds in the HFIL revolving fund from any source that is
not needed for debt service, approved administrative costs, or
reasonable reserves must be available for additional loans to ultimate
recipients;
(4) All reserves and other funds in the HFIL revolving loan fund
not immediately needed for loans to ultimate recipients or other
authorized uses must be deposited in accounts in banks or other
financial institutions. Such accounts must be fully covered by Federal
deposit insurance or fully collateralized with U.S. Government
obligations, and will be interest bearing. Any interest earned thereon
remains a part of the HFIL revolving fund;
(5) If an intermediary lender receives more than one HFIL loan, it
does not need to establish and maintain a separate HFIL revolving loan
fund for each loan; it may combine them and maintain only one HFIL
revolving fund, unless the Agency requires separate HFIL revolving
funds because there are significant differences in the loan purposes,
Intermediary Relending Agreement, loan agreements, or requirements for
the loans; and
(6) A reasonable amount of revolved funds must be used to create a
reserve for bad debts. Reserves should be accumulated over a period of
years. The total amount should not exceed maximum expected losses,
considering the quality of the intermediary lender's portfolio of
loans. Unless the intermediary lender provides loss and delinquency
records that, in the opinion of the Agency, justifies different
amounts, a reserve for bad debts of 6 percent of outstanding loans must
be accumulated over 5 years and then maintained.
(b) Loan monitoring reviews. The intermediary lender must complete
loan monitoring reviews, including annual and periodic reviews, and
performance monitoring.
(1) At least annually, the intermediary lender must provide the
Agency documents for the purpose of reviewing the financial status of
the intermediary Lender, assessing the progress of utilizing loan
funds, and identifying any potential problems or concerns. Non-
regulated intermediary lenders must furnish audited financial
statements at least annually.
(2) At any time the Agency determines it is necessary, the
intermediary lender must allow the Agency or its representative to
review the operations and financial condition of the intermediary
lender. Upon the Agency requests, the Intermediary must submit
financial or other information within 14 days unless the data requested
is not available within that time frame.
(c) Progress reports. Each intermediary lender will be monitored by
the Agency based on progress reports submitted by the intermediary
lender, audit findings, disbursement transactions, visitations, and
other contact with the intermediary lender as necessary.
Sec. 769.122 Loan servicing.
(a) Payments. Payments will be made to the Agency as specified in
loan agreements and debt instruments. The funds from any extra payments
will be applied entirely to loan principal.
(b) Restructuring. The Agency may restructure the intermediary
lender's loan debt, if:
(1) The Government's interest will be protected;
(2) The restructuring will be performed within the Agency's budget
authority; and
[[Page 74974]]
(3) The loan objectives cannot be met unless the HFIL loan is
restructured.
(c) Default. In the event of monetary or non-monetary default, the
Agency will take all appropriate actions to protect its interest,
including, but not limited to, declaring the debt fully due and payable
and may proceed to enforce its rights under the loan agreement or any
other loan instruments relating to the loan under applicable law and
regulations, and commencement of legal action to protect the Agency's
interest. The Agency will work with the intermediary lender to correct
any default, subject to the requirements of paragraph (b) of this
section. Violation of any agreement with the Agency or failure to
comply with reporting or other program requirements will be considered
non-monetary default.
Sec. 769.123 Transfer and assumption.
(a) All transfers and assumptions must be approved in advance in
writing by the Agency. The assuming entity must meet all eligibility
criteria for the HFIL Loan Program.
(b) Available transfer and assumption options to eligible
intermediary lenders include the following:
(1) The total indebtedness may be transferred to another eligible
intermediary lender on the same terms; or
(2) The total indebtedness may be transferred to another eligible
intermediary lender on different terms not to exceed the term for which
an initial loan can be made. The assuming entity must meet all
eligibility criteria for the HFIL Loan Program.
(c) The transferor must prepare the transfer document for the
Agency review prior to the transfer and assumption.
(d) The transferee must provide the Agency with information
required in the application as specified in Sec. 769.109.
(e) The Agency prepared assumption agreement will contain the
Agency case number of the transferor and transferee.
(f) The transferee must complete an application as specified in
Sec. 769.109(a).
(g) When the transferee makes a cash down-payment in connection
with the transfer and assumption, any proceeds received by the
transferor will be credited on the transferor's loan debt in order of
maturity date.
(h) The Administrator or designee will approve or decline all
transfers and assumptions.
Sec. 769.124 Appeals.
Any appealable adverse decision made by the Agency may be appealed
upon written request of the intermediary as specified in 7 CFR part 11.
Sec. 769.125 Exceptions.
The Agency may grant an exception to any of the requirements of
this part if the proposed change is in the best financial interest of
the Government and not inconsistent with the authorizing law or any
other applicable law.
Val Dolcini,
Administrator, Farm Service Agency.
[FR Doc. 2015-30331 Filed 11-30-15; 8:45 am]
BILLING CODE 3410-05-P
