Technical Service Provider Assistance: Interim Final Rule with Request for Comments

Federal Register: March 24, 2003 (Volume 68, Number 56)
Rules and Regulations
Page 14131-14134
[DOCID:fr24mr03-2]

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Technical Service Provider Assistance: Interim Final Rule with Request for Comment

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DEPARTMENT OF AGRICULTURE

Natural Resources Conservation Service

7 CFR Part 652


Technical Service Provider Assistance

AGENCY: Natural Resources Conservation Service, USDA.

ACTION: Interim final rule with request for comments.

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SUMMARY: This rulemaking amends the technical service provider
assistance rule, 7 CFR part 652, published in the Federal Register on
November 21, 2002, by setting forth the United States Department of
Agriculture (Department) process for establishing payment rates for
program participant acquisition of technical services. In addition,
this rulemaking sets forth the Department's policy regarding
subcontracting by technical service providers in the course of their
delivery of technical services and amends 7 CFR part 652 accordingly.
Finally the Department is using the opportunity presented by this
rulemaking to clarify its policy regarding the certification process,
to amend the definition of technical service provider in 7 CFR 652.21,
and to amend the dates for submitting an Application for Certification
in 7 CFR 652.21(f) and (d). The Natural Resources Conservation Service
(NRCS) seeks comments from the public on this interim final rule.

DATES: Effective date: March 24, 2003. Comments on this rule must be
received by June 23, 2003.

ADDRESSES: Send comments by mail to Melissa Hammond, Technical Service
Provider Coordinator, Natural Resources Conservation Service, P.O. Box
2890, Washington, DC 20013, or by e-mail to: melissa.hammond@usda.gov

Attention: Technical Service Provider Assistance. This interim final
rule may also be accessed via the Internet through the NRCS Home Page
at http://www.nrcs.usda.gov, by selecting Farm Bill 2002.

at http://www.nrcs.usda.gov, by selecting Farm Bill 2002.


FOR FURTHER INFORMATION CONTACT: Melissa Hammond, Technical Service
Provider Coordinator, Strategic Natural Resource Issues Staff, NRCS,
P.O. Box 2890, Washington, DC 20013-2890; telephone: (202) 720-6731;
fax: (202) 720-3052; submit e-mail to: gary.gross@usda.gov, Attention:

Technical Service Provider Assistance.

SUPPLEMENTARY INFORMATION:

Discussion
Payment Rates
As indicated in the preamble section of the technical service
provider interim final rule, 7 CFR part 652, the Department is
publishing this interim final rule, which amends the technical service
provider rule, in order to set forth the Department's method of setting
payment rates for technical service provider reimbursement.
Accordingly, this rulemaking adds a new paragraph (j) to section 652.5
of the existing technical service provider rule, and adds a new
paragraph (h) to section 652.4, which addresses the use of
subcontractors. This rulemaking also clarifies the Department's policy
regarding the certification process set forth in the interim final rule
at 7 CFR part 652.21.

The Department will determine payment rates by setting not-to-
exceed rates for technical services. The Department may use some of the
methods set forth in the preamble of the interim final rule, 7 CFR part
652, when calculating these rates, including conducting a national
survey of technical service providers and vendors who provide technical
services to determine their price data for actual services performed
and using NRCS's own cost of providing technical services. In addition,
when determining not-to-exceed rates, NRCS may use other sources of
data that it determines are reliable, including its own cost of
procuring technical services. The Department chose this method to set
the technical service not-to-exceed rates because it provides direct
input from the marketplace.

For at least the first year of implementation of the technical
service provider process, one of the methods NRCS will use to obtain
cost data is directly from technical service providers through the
existing Internet-based posting system called FedBizOpps. Through a
notice on the NRCS Web site, and using existing agency mailing lists,
the Department will be requesting providers to respond to a
solicitation posted at the FedBizOpps Web site, http://www.fedbizopps.gov/  for cost data related to specific categories of

www.fedbizopps.gov/, for cost data related to specific categories of
technical services and specific geographic areas. The Department
anticipates that it will post this solicitation by March 1, 2003. Any
price data collected from technical service providers and vendors with
the national survey is for informational purposes only to assist the
Department in establishing payment rates for technical services.
Submission of price data by the provider does not obligate the
Department, nor does it guarantee the provider the award of a specific
contract by any program participant or the Department for carrying out
technical services.

NRCS will analyze the pricing information submitted through
FedBizOpps, and that obtained from other sources, using a standardized
methodology. Not-to-exceed payment rates will be established nationally
on a State by State basis for categories of technical services. To
ensure consistency across State lines, NRCS will coordinate payment
rates between adjacent States where similar resource conditions and
agricultural operations exist, taking into account differences in State
laws, the cost of doing business, competition, and other variables.
NRCS may subsequently adjust the rates, as needed on a case by case
basis, during program implementation in response to unusual conditions
or unforeseen circumstances, such as services provided for highly
complex technical situations, emergency conditions, serious threats to
human health or the environment, or major resource limitations. In
these cases, NRCS will set a case-specific not-to-exceed payment rate.
The Department will review the Technical Service Provider system,
including the certification, payment, and technical service quality
evaluation processes, by March 1, 2004.

In order to encourage participants to consider price in their
selection of technical service providers, NRCS may provide program
participants, who select technical service providers with prices below
the not-to-exceed rate,

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with a credit of 50 percent of the technical service savings to apply
toward their cost of practice installation. Specifically, the program
participant would receive 50 percent of the cost savings of the
difference between the not-to-exceed rate and the actual billing for
the technical services provided. For example, if the not-to-exceed rate
for technical services for a conservation practice is $10,000, and the
participant chooses a provider whose service costs $9,000, the
participant has earned a $500 credit toward the cost of practice
installation. Assuming the participant's application has been selected
for funding, the practice to be installed cost $20,000, and the cost
share requirement is 50 percent, then the participant's cost share of
the practice would be $9,500. Using this incentive system, both the
participant and the Federal government enjoy a net savings, and the end
result is a more efficient and cost-effective process.

Under no circumstances may the earning of credits by a participant
result in the Department exceeding any statutory limitation on cost-
sharing or payments for a particular program. Additionally, the earning
of credits has no bearing on whether an application for financial
assistance (installation of conservation practices) is selected.
Consequently, the credit system will not result in a violation of any
statutory prohibition against ``bidding down,'' (i.e., using cost as
the deciding factor when choosing among applications that are expected
to yield comparable environmental benefits).

NRCS believes that this dynamic approach to setting not-to-exceed
payment rates and providing incentives to program participants to
choose competitively priced services will help ensure that its payment
rates do not lag behind the development of technological efficiencies
that decrease the time and cost associated with the delivery of
technical services.

NRCS is interested in receiving comments on any aspect of payment
rates included in this rulemaking amendment or any other items
regarding payment rates.

Use of Subcontractors By Technical Service Providers
Technical service providers may not always have the expertise
needed to carry out all aspects of delivering technical services for
conservation practices or for conservation planning. Therefore, in
order to make efficient use of the marketplace, technical service
providers contracted to carry out technical services may use the
services of subcontractors who are certified by NRCS for the specific
technical services or expertise needed. The contracted technical
service provider remains responsible for the overall technical services
provided. In addition, subcontracted technical service providers are
responsible for providing services in accordance with the terms of
their Certification Agreement. Technical service providers will not be
reimbursed if they subcontract with entities that are not certified
providers for the particular technical services which they are
providing.

National Certification
The Department is using the opportunity presented by this
rulemaking to clarify its policy regarding the certification process
set forth in the interim final rule at 7 CFR part 652. The technical
service provider certification process is a national certification
process with uniform criteria and requirements; see 7 CFR part 652.21.
Applicants can apply for certification to the Chief, NRCS, through the
agency's TechReg Web site using one application, and listing each State
for which the applicant wishes to be considered for certification.
Applicants must meet the certification criteria for each category of
technical services in which they desire certification.

Applicants are required to self-certify that they meet all
applicable State licensing or similar requirements for those technical
services where certification is sought for each State. Applicants for
certification must demonstrate, through documentation of training or
experience, familiarity with NRCS guidelines, criteria, standards, and
specifications as set forth in the applicable NRCS manuals, handbooks,
field office technical guides, and supplements thereto, for planning
and applying specific conservation practices and management systems for
which certification is sought. In addition to National and State NRCS
guidelines and criteria, applicants must also be familiar with any
unique criteria required at the county level for particular practices
before providing services in a particular county. By signing a
Certification Agreement, applicants are acknowledging that they are
aware of these local criteria, and agree to familiarize themselves with
any such criteria by contacting the appropriate NRCS State official
before providing technical services. In order to be considered for
certification, the applicant must submit a completed Certification
Application to NRCS electronically through the TechReg Web site. The
Department encourages applicants and certified technical service
providers to participate in NRCS sponsored trainings at the State and
local level in order to gain familiarity with NRCS local criteria and
guidelines, as well as to stay current on new developments in agency
policy related to the provision of technical services.

NRCS is amending the definition of technical service provider to
reflect national certification. NRCS is also revising the dates from
March 1, 2003, to June 1, 2003, for submitting an application regarding
conditional certifications in section 652.21(f) and (g).

Request for Comments
NRCS is extending the comment period for the Technical Service
Provider Assistance Interim Final Rule published on November 21, 2002,
Vol. 67, No. 225, for 30 days. Comments must be received by the date
indicated at the beginning of this amendment. Comments on this
amendment must be received within 90 days after publication in the
Federal Register in accordance with the date indicated at the beginning
of this amendment.

NRCS is interested in receiving additional feedback from the public
on the following issues.

Whether governing board members of a public agency should or should
not be engaged as private consultant technical service providers or as
technical service providers under the auspices of that public agency.
Whether or not there should be a maximum number of uncertified
employees serving under the direction of a certified individual within
a private-sector entity, or a public agency where that certified
individual warrants the work of those uncertified employees and what
that maximum number should be.

Regulatory Certifications

Executive Order 12866
Pursuant to Executive Order 12866 (58 FR 51735, October 4, 1993),
it has been determined that this interim final rule is a significant
regulatory action, and has been reviewed by the Office of Management
and Budget (OMB). Pursuant to section 6(a)(3) of Executive Order 12866,
NRCS conducted an economic analysis of the potential impacts associated
with the interim final rule for Technical Service Provider Assistance
published in the Federal Register on November 21, 2002, and included
the analysis as part of a Regulatory Impact Analysis document prepared
for that interim final rule. The provisions of this interim final rule
do not alter the analysis that was originally

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prepared. A copy of the analysis is available upon request from Gary
Gross, Resource Conservationist, Natural Resources Conservation
Service, P.O. Box 2890, Washington, DC 20013-2890; or by e-mail to
gary.gross@usda.gov, Attention: Technical Service Provider Assistance--

Economic Analysis; or at the following Web address: http://www.nrcs.usda.gov

Executive Order 12988
This interim final rule has been reviewed in accordance with
Executive Order 12988. The provisions of this interim final rule are
not retroactive. The U.S. Department of Agriculture (USDA) has not
identified any State or local laws that are in conflict with this
regulation, or that would impede full implementation of this rule. In
the event that such conflict is identified, the provisions of this
interim final rule preempt State and local laws to the extent that such
laws are inconsistent with this rule.

Regulatory Flexibility Act
The Regulatory Flexibility Act is not applicable to this rule
because the Secretary of Agriculture is not required by 5 U.S.C. 553 or
any other provision of law to publish a notice of proposed rulemaking
with respect to the subject matter of this rule.

National Environmental Policy Act
The regulations promulgated by this rule do not authorize any
action that may negatively affect the human environment. Accordingly,
an analysis of impacts under the National Environmental Policy Act, 42
U.S.C. 4321 et seq., has not been performed. This interim final rule
will help implement new and existing USDA conservation programs, which
are subject to the environmental analyses pursuant to the National
Environmental Policy Act.

Paperwork Reduction Act
Section 2702 of the Farm Security and Rural Investment Act of 2002
requires that the promulgation of regulations and the administration of
title II of said Act, which authorizes the use of certified technical
service providers, be carried out without regard to chapter 35 of title
44 of the United States Code (commonly known as the Paperwork Reduction
Act). Accordingly, these regulations, related forms, and other
information collection activities needed to establish payment rates
under these regulations, are not subject to review by the Office of
Management and Budget under the Paperwork Reduction Act.

NRCS is committed to compliance with the Government Paperwork
Elimination Act (GPEA) and the Freedom to E-File Act, which require
government agencies, in general, to provide the public with the option
of submitting information or transacting business electronically to the
maximum extent possible, and to NRCS in particular. The forms and other
information collection activities required for participation in
technical services delivery under the technical service provider
assistance rule, amended by this rule, are not fully implemented for
the public to conduct business with NRCS electronically. However, the
required standard forms discussed in this rule will be available
electronically through the USDA eForms Web site, at
www.sc.egov.usda.gov, for downloading. The regulation will be available
at the NRCS home page at www.nrcs.usda.gov

Unfunded Mandates Reform Act of 1995
Pursuant to title II of the Unfunded Mandates Reform Act of 1995,
Pub. L. 104-4, NRCS assessed the effects of this rulemaking action on
State, local, and tribal governments, and the public. This action does
not compel the expenditure of $100 million or more by any State, local,
or tribal governments, or anyone in the private sector; therefore, a
statement under section 202 of the Unfunded Mandates Reform Act of 1995
is not required.

Federal Crop Insurance Reform and Department of Agriculture
Reorganization Act of 1994
Pursuant to section 304 of the Department of Agriculture
Reorganization Act of 1994, Pub. L. 104-354, USDA classified this
interim final rule as not major.

Civil Rights Impact Analysis
A Civil Rights Impact Analysis was completed for the interim final
rule for Technical Service Provider Assistance published in the Federal
Register on November 21, 2002. The provisions of this interim final
rule do not alter analysis that was originally prepared. The review
revealed no factors indicating any disproportionate adverse civil
rights impacts for participants in NRCS programs and services who are
minorities, women, or persons with disabilities. A copy of this
analysis is available upon request from Gary Gross, Resource
Conservationist, Natural Resources Conservation Service, P.O. Box 2890,
Washington, DC 20013-2890; or by e-mail to gary.gross@usda.gov,

Attention: Technical Service Provider Assistance--Civil Rights Impact
Analysis; or at the following Web address: http://www.nrcs.usda.gov.

List of Subjects in 7 CFR Part 652
Natural Resources Conservation Service, Soil conservation,
Technical assistance, Water resources.

For the reasons stated in the preamble, the Natural Resources
Conservation Service hereby amends title 7 of the Code of Federal
Regulations as set forth below:
Accordingly, title 7 of the Code of Federal Regulations part 652 is
amended by adding a new paragraph.

PART 652--TECHNICAL SERVICE PROVIDER ASSISTANCE

1. The authority citation for part 652 continues to read as
follows:

Authority: 16 U.S.C. 3842.

2. Section 652.5 is amended by revising paragraph (d) and adding a
new paragraph (j) to read as follows:

Sec. 652.5 Program participant acquisition of technical services.

* * * * *
(d) To obtain payment for technical services, the program
participant must submit to the Department an invoice, supporting
documentation, and a request for payment. The Department may pay a
program participant for technical services provided by a technical
service provider hired by the program participant through a
reimbursement payment made directly to the program participant; or upon
receipt of an assignment of payment from the program participant, a
payment made directly to the technical service provider.
* * * * *
(j) Payment rates.
(1) NRCS will establish payment rates by calculating not-to-exceed
rates for technical services. NRCS will calculate not-to-exceed rates
using price data that it may acquire through various sources that it
deems reliable.
(2) Establishing not-to-exceed payment rates.
(i) NRCS will analyze the pricing information using a standardized
methodology.
(ii) Not-to-exceed payment rates will be established nationally on
a State by State basis for categories of technical services.
(iii) NRCS will coordinate payment rates between adjacent States to
ensure consistency where similar resource conditions and agricultural
operations exist. Payment rates may vary to some

[[Page 14134]]

degree between States due to differences in State laws, the cost of
doing business, competition, and other variables.
(iv) NRCS will review payment rates annually, or more frequently as
needed, and adjust the rates based upon data from existing contracts,
Federal cost rates, and other appropriate sources.
(v) NRCS may adjust payment rates, as needed, on a case-by-case
basis, in response to unusual conditions or unforeseen circumstances in
delivering technical services such as highly complex technical
situations, emergency conditions, serious threats to human health or
the environment, or major resource limitations. In these cases, NRCS
will set a case-specific not-to-exceed payment rate based on the
Department's determination of the scope, magnitude, and timeliness of
the technical services needed.
(3) Cost share credits. In order to encourage competitive pricing,
a program participant may earn credits toward their cost-share for
practice installation under a program contract when a participant
selects a technical service provider with prices below the not-to-
exceed rates for the provision of technical services. The credits
earned will be equal to a percentage of the savings generated by the
participant by choosing a lower cost technical service provider.
However, in no cases may the application of cost share credits to a
program contract result in the Department exceeding any statutory
limitations on cost sharing or payments for a particular program.

3. Section 652.1 is amended by revising the definition of technical
service provider to read as follows:


Sec. 652.1 Definitions.

* * * * *
Technical service provider means an individual, entity, or public
agency certified by NRCS and placed on the approved list to provide
technical services to program participants or to the Department.
4. Section 652.4 is amended by adding a new paragraph (h) to read
as follows:


Sec. 652.4 Technical service standards.

* * * * *
(h) Technical service providers may utilize the services of
subcontractors to provide specific technical services or expertise
needed by the technical service provider, provided that the
subcontractors are certified by NRCS in accordance with this part for
the particular technical services to be provided and the technical
services are provided in terms of their certification agreement.
Payments will not be made for any technical services provided by
uncertified subcontractors.

5. In Sec. 652.21 paragraphs (f) and (g) are revised to read as
follows:
* * * * *
(f) An individual, private-sector entity, or public agency is
conditionally certified provided they had entered into a contract,
cooperative agreement, or contribution agreement with the Department
prior to March 24, 2003 to provide technical services and they submit
an Application for Certification by June 1, 2003. An individual,
private-sector entity, or public agency with conditional certification
status under this paragraph may continue to provide technical services
in accordance with the terms and conditions of the above-described
contract, cooperative agreement, or contribution agreement. Conditional
certification shall expire either by the date NRCS and the individual,
private-sector entity, or public agency enter into a Certification
Agreement, as described in Sec. 652.22(c)(1) or September 30, 2003,
whichever is earlier.
(g) An individual is conditionally certified if the individual was
certified under NRCS policy in effect prior to March 24, 2003, and
submits an Application for Certification by June 1, 2003. An individual
with conditional certification status under this paragraph may continue
to provide technical services to the Department and to program
participants in accordance with the above-described prior
certification. Conditional certification shall expire either by the
date NRCS and the individual enter into a Certification Agreement, as
described in Sec. 652.22(c)(1) or September 30, 2003, whichever is
earlier.

Signed in Washington, DC on March 7, 2003.
Bruce I. Knight,
Chief, Natural Resources Conservation Service.
[FR Doc. 03-6668 Filed 3-21-03; 8:45 am]
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