(a) The BLM must manage certain landscapes to protect their intactness, including habitat connectivity and old-growth forests. This requires:

(1) Maintaining ecosystem resilience and habitat connectivity through conservation actions;

(2) Conserving landscape intactness when managing compatible uses, especially where development or fragmentation that could permanently impair ecosystem resilience has the potential to occur on public lands;

(3) Maintaining or restoring resilient ecosystems through habitat and ecosystem restoration projects that are implemented over broader spatial and longer temporal scales;

(4) Coordinating and implementing actions across BLM programs, offices, and partners to protect intact landscapes; and

(5) Pursuing management actions that maintain or mimic characteristic disturbance, or mimic natural disturbance, when maintaining it is not possible.

(b) Authorized officers will seek to prioritize actions that conserve and protect landscape intactness in accordance with § 6101.2.

(a) The BLM will maintain an inventory of landscape intactness as a resource value using watershed condition assessments (see § 6103.2(a)) to establish a consistent baseline condition.

(b) When updating a resource management plan under part 1600 of this chapter, the BLM will use a baseline condition of intactness and available high-quality information about landscape intactness, such as watershed condition assessments, environmental disturbances, and monitoring (see § 6103.2), to:

(1) Identify and delineate boundaries for intact landscapes within the planning area, taking into consideration habitat connectivity and migration corridor data;

(2) Evaluate alternatives to protect intact landscapes or portions of the intact landscapes from activities that would permanently or significantly disrupt, impair, or degrade the ecosystem's structure or functionality of the intact landscapes; and

(3) Identify which intact landscapes or portions of intact landscapes will be managed for protection consistent with the principles enumerated in § 6102.1(a).

(c) The BLM will identify desired conditions and landscape objectives to guide implementation of decisions regarding management of intact landscapes, habitat connectivity, and old-growth forests. As part of carrying out paragraph (b) of this section, the BLM will seek to:

(1) Establish partnerships to work across Federal and non-Federal lands to promote and protect intact landscapes;

(2) Work with communities to identify geographic areas important for their strategic growth and development in order to allow for better identification of the most suitable areas to protect intact landscapes and habitat connectivity;

(3) Consult with Tribes to identify opportunities for co-stewardship to protect intact landscapes (see § 6102.5(b)(4) through (6)); and

(4) Use high-quality information including standardized quantitative monitoring to evaluate the effectiveness of management actions for ecosystem resilience (see § 6103.2).

(d) When determining whether to acquire lands or interests in lands through purchase, donation, or exchange, authorized officers must prioritize the acquisition of lands or interests in lands that would further protect and connect intact landscapes and functioning ecosystems.

(e) Authorized officers must collect and track landscape intactness data to support minimizing surface disturbance and inform conservation actions. This information must be included in a publicly available national tracking system.

(a) The BLM must emphasize restoration on the public lands to achieve its multiple use and sustained yield mandate.

(b) In determining the restoration actions required to achieve recovery of ecosystems and promote resilience, the BLM must consider the causes of degradation, the recovery potential of the ecosystem, and the allowable uses in the governing land use plan, such as whether an area is managed for recreation or is degraded land prioritized for development. The BLM must then develop commensurate restoration goals and objectives (see § 6103.1.1).

(c) The BLM should employ management actions to promote restoration. Over the long-term, restoration actions must be durable, self-sustaining, and expected to persist in a manner that supports land health and ecosystem resilience.

(d) When designing and implementing restoration actions on public lands, including authorizing restoration leases, authorized officers must adhere to the following principles:

(1) Ensure that restoration actions address causes of degradation, focus on process-based solutions, and where possible maintain attributes and resource values associated with the potential or capability of the ecosystem;

(2) Ensure that actions are designed, implemented, and monitored at appropriate spatial and temporal scales using suitable treatments and tools to achieve desired outcomes;

(3) Coordinate and implement actions across BLM programs, with partners, and in consideration of existing uses to develop holistic restoration actions;

(4) Ensure incorporation of locally appropriate best management practices, high-quality information, and adaptive management that supports restoration;

(5) Identify opportunities to implement nature-based or low-tech restoration activities and use seed from native plants; and

(6) Consult with Tribes to identify opportunities for co-stewardship or collaboration (see § 6102.5(b)(4) through (6)).

(a) Authorized officers must identify measurable and quantifiable restoration outcomes consistent with the restoration principles enumerated in § 6102.3 in all resource management plans.

(b) Authorized officers will, at least every 5 years, identify priority landscapes for restoration consistent with resource management plan objectives and the restoration principles enumerated in § 6102.3. In doing so, authorized officers must consider:

(1) Current conditions and causes of degradation as indicated by watershed condition assessments, existing land health assessments, evaluations, and determinations, and other high-quality information (see § 6103.2);

(2) The likelihood of success of restoration activities to achieve resource or conservation objectives including ecosystem resilience;

(3) Where restoration actions may have the most social and economic benefits or work to address environmental justice, including impacts on communities with environmental justice concerns; and

(4) Where restoration or mitigation can minimize or offset unnecessary or undue degradation, such as ecosystem conversion, fragmentation, habitat loss, or other negative outcomes that permanently impair ecosystem resilience.

(c) For priority landscapes identified in accordance with this subpart, authorized officers must periodically, and at least every 5 years, develop or amend restoration plans consistent with resource management plan objectives in accordance with part 1600 of this chapter. Each restoration plan must include goals, objectives, and management actions that are:

(1) Consistent with the restoration principles enumerated in § 6102.3;

(2) Commensurate with recovery potential;

(3) Evaluated against measurable objectives, including to facilitate adaptive management to achieve outcomes supporting ecosystem resilience (see subpart 6103);

(4) Developed consistent with scientifically accepted standards and principles for restoration; and

(5) Consistent with statewide and regional needs as identified in the assessment of priority landscapes for restoration as identified in this subpart.

(d) Authorized officers must track restoration implementation and progress toward achieving goals at appropriate temporal scales. If restoration goals are not met, authorized officers must assess why restoration outcomes are not being achieved and what, if any, additional resources or changes to management are needed to achieve restoration goals.

(a) The BLM may authorize restoration leases or mitigation leases under such terms and conditions as the authorized officer determines are appropriate for the purpose of restoring degraded landscapes or mitigating impacts of other uses.

(1) Restoration or mitigation leases on the public lands may be authorized for the following purposes:

(i) Restoration of land and resources by passively or actively assisting the recovery of an ecosystem that has been degraded, damaged, or destroyed to a more natural, resilient ecological state; and

(ii) Mitigation to offset impacts to resources resulting from other land use authorizations.

(2) Authorized officers may issue restoration or mitigation leases to any qualified entity that can demonstrate capacity for implementing restoration or mitigation projects (as appropriate) and meets the lease requirements. Consistent with the lease adjudication practices established in 43 CFR 2920, qualified entities for restoration or mitigation leases may be individuals, businesses, non-governmental organizations, Tribal governments, conservation districts, or State fish and wildlife agencies. Qualified entities for a mitigation lease to establish an in-lieu fee program are limited to non-governmental organizations, State fish and wildlife agencies, and Tribal government organizations. Restoration and mitigation leases may not be held by a foreign person as that term is defined in 31 CFR 802.221.

(3) Restoration or mitigation leases shall be issued for a term consistent with the time required to achieve their objective.

(i) A lease issued for purposes of restoration may be issued for a maximum term of 10 years, and all activities taken under the lease shall be reviewed mid-term for consistency with the lease provisions.

(ii) A lease issued for purposes of mitigation shall be issued for a term commensurate with the impact it is mitigating, and all activities taken under the lease reviewed every 5 years for consistency with the lease provisions.

(iii) Authorized officers may renew a restoration or mitigation lease if necessary to serve the purpose for which the lease was first issued, provided that the lease holder is in compliance with the terms and conditions of the lease and renewal is consistent with applicable law. Such renewal can be for a period no longer than the original term of the lease.

(4) Subject to valid existing rights and applicable law, once the BLM has issued a lease, the BLM shall not issue new authorizations to use the leased lands if the use would be incompatible with the authorized restoration or mitigation use.

(5) No land use authorization is required under the regulations in this part for casual use of the public lands covered by a restoration or mitigation lease.

(b) The application process for a restoration or mitigation lease and for renewal of such a lease is as follows:

(1) An application for a restoration or mitigation lease must be filed using an approved application form with the Bureau of Land Management office having jurisdiction over the public lands covered by the application.

(2) The filing of an application gives the applicant no right to use the public lands.

(3) Acceptance of an application or approval of a lease is not guaranteed and is at the discretion of the authorized officer.

(4) Actions that pertain to or address geographic areas or resource conditions previously identified as needing restoration by the BLM through watershed condition assessments and existing land health assessments, land health evaluations, an existing restoration plan, a mitigation strategy, or high-quality inventory, assessment, and monitoring information shall be given priority for consideration (see subpart 6103).

(c) An application for a restoration or mitigation lease must comply with the following requirements:

(1) An application must include a restoration or mitigation development plan that describes the proposed restoration or mitigation use in sufficient detail to enable authorized officers to evaluate the feasibility, impacts, benefits, costs, threats to public health and safety, collaborative efforts, and conformance with BLM plans, programs, and policies, including compatibility with other uses.

(2) The development plan shall include, but not be limited to:

(i) Results from available assessments, inventory and monitoring efforts, or other high-quality information (see subpart 6103) that identify the current conditions of the site(s) of the proposed restoration or mitigation action;

(ii) The desired future condition of the proposed lease area including clear goals, objectives, and measurable performance criteria needed to determine progress toward achieving the objectives;

(iii) Justification for passive restoration or mitigation if proposed;

(iv) A description of all facilities for which authorization is sought, including access needs and any other special types of authorizations that may be needed;

(v) A map of sufficient scale to allow the required information to be legible as well as a legal description of primary and alternative project locations;

(vi) Justification of the total acres proposed for the restoration or mitigation lease;

(vii) A schedule for restoration activities if applicable; and

(viii) Information on outreach already conducted or to be conducted with existing permittees, lease holders, adjacent land managers or owners, and other interested parties.

(3) Restoration lease development plans must be consistent with § 6102.3 and mitigation lease development plans must be consistent with § 6102.5.1.

(4) Applicants must submit the following additional information, upon request of the authorized officer:

(i) Additional high-quality information, if such information is necessary for the BLM to decide whether to issue, issue with modification, or deny the proposed lease;

(ii) Documentation of or proof of application for any required private, State, local, or other Federal agency licenses, permits, easements, certificates, or other approvals; and

(iii) Evidence that the applicant has, or will have prior to commencement of lease activities, the technical and financial capability to operate, maintain, and terminate the authorized lease activities.

(d) When reviewing restoration and mitigation lease applications, authorized officers will consider the following factors, along with other applicable legal requirements, which will make lease issuance more likely:

(1) Lease outcomes that are consistent with the restoration principles in § 6102.3(d);

(2) Desired future conditions that are consistent with the management objectives and allowable uses in the governing land use plan, such as an area managed for recreation or prioritized for development;

(3) Collaboration with existing permittees, leaseholders, and adjacent land managers or owners;

(4) Outreach to or support from local communities; or

(5) Consideration of environmental justice objectives.

(e) If approved, the leaseholder shall provide a monitoring plan that describes how the terms and conditions of the lease will be applied, the monitoring methodology and frequency, measurable criteria, and adaptive management triggers.

(1) The lease holder shall provide a lease activity report annually and at the end of the lease period. At a minimum, the report shall specify:

(i) The restoration or mitigation activities taken as of the time of the report;

(ii) Any barriers to meeting the stated purpose of the lease;

(iii) Proposed steps to resolve any identified barriers; and

(iv) Monitoring information and data that meet BLM methodology requirements and data standards (see § 6103.2(d)).

(2) Additional requirements for development plans and monitoring plans for mitigation leases are provided in § 6102.5.1.

(f) An approved lease does not convey exclusive rights to use the public lands to the lease holder The authorized officer retains the discretion to determine compatibility of the renewal of existing authorizations and future land use proposals on lands subject to restoration or mitigation leases.

(g) A restoration or mitigation lease will not preclude access to or across leased areas for casual use, recreation use, research use, or other use taken pursuant to a land use authorization that is compatible with the approved restoration or mitigation use.

(h) Existing access that accommodates accessibility under section 504 of the Rehabilitation Act shall remain after a lease has been issued.

(i) A restoration or mitigation lease may only be amended, assigned, or transferred with the written approval of the authorized officer, and no amendment, assignment, or transfer shall be effective until the BLM has approved it in writing. Authorized officers may authorize assignment or transfer of a restoration or mitigation lease in their discretion if no additional rights will be conveyed beyond those granted by the original authorization, the proposed assignee or transferee is qualified to hold the lease, and the assignment or transfer is in the public interest.

(j) Administrative cost recovery, rents, and fees for restoration and mitigation leases will be governed by the provisions of 43 CFR 2920.6 and 2920.8, provided that the BLM may waive or reduce administrative cost recovery, fees, and rent of a restoration lease if the restoration lease is not used to generate revenue or satisfy the requirements of a mitigation program (e.g., selling credits in an established market), and the restoration lease will enhance ecological or cultural resources or provide a benefit to the general public.

(a) If a restoration or mitigation lease provides by its terms that it shall terminate on the occurrence of a fixed or agreed-upon event, the restoration or mitigation lease shall automatically terminate by operation of law upon the occurrence of such event.

(b) A restoration or mitigation lease may be terminated by mutual written agreement between the authorized officer and the lease holder.

(c) Authorized officers have discretion to suspend or terminate restoration or mitigation leases under the following circumstances:

(1) Improper issuance of the lease;

(2) Noncompliance by the holder with applicable law, regulations, or terms and conditions of the lease;

(3) Failure of the holder to use the lease for the purpose for which it was authorized; or

(4) Impossibility of fulfilling the purposes of the lease.

(d) Upon determination that the holder has failed to comply with any terms or conditions of a lease and that such noncompliance adversely affects or poses a threat to land or public health or safety, or impacts ecosystem resilience, the authorized officer shall issue an immediate temporary suspension.

(1) The authorized officer may issue an immediate temporary suspension order orally or in writing at the site of the activity to the holder or a contractor or subcontractor of the holder, or to any representative, agent, employee, or contractor of any such holder, contractor, or subcontractor, and the suspended activity shall cease at that time. As soon as practicable, the authorized officer shall confirm the order by a written notice to the holder addressed to the holder or the holder's designated agent. The authorized officer may also take such action that the authorized officer considers necessary to address the adverse effects or threat to land or public health or safety or impacts to ecosystem resilience.

(2) The authorized officer may order immediate temporary suspension of an activity independent of any action that has been or is being taken by another Federal or State agency.

(3) Any time after an order of temporary suspension has been issued, the holder may file with the authorized officer a request for permission to resume activities authorized by the lease. The request shall be in writing and shall contain a statement of the facts supporting the request. The authorized officer may grant the request upon determination that the adverse effects or threat to land or public health or safety or impacts to ecosystem resilience are resolved.

(4) The authorized officer may render an order to either grant or deny the request to resume within 30 working days of the date the request is filed. If the authorized officer does not render an order on the request within 30 working days, the request shall be considered denied, and the holder shall have the same right to appeal as if an order denying the request had been issued.

(e) Process for termination or suspension other than temporary immediate suspension.

(1) Prior to commencing any proceeding to suspend or terminate a lease, the authorized officer shall give written notice to the holder of the legal grounds for such action and shall give the holder a reasonable time to address the legal basis the authorized officer identifies for suspension or termination.

(2) After due notice of termination or suspension to the holder of a restoration or mitigation lease, if grounds for suspension or termination still exist after a reasonable time, the authorized officer shall give written notice to the holder and refer the matter to the Office of Hearings and Appeals for a hearing before an administrative law judge pursuant to 43 CFR part 4. The authorized officer shall suspend or revoke the restoration or mitigation lease if the administrative law judge determines that grounds for suspension or revocation exist and that such action is justified.

(3) Authorized officers shall terminate a suspension order when they determine that the grounds for such suspension no longer exist.

(4) Upon termination of a restoration or mitigation lease, the holder shall, for 60 days after the notice of termination, retain authorization to use the associated public lands solely for the purposes of reclaiming the site to its pre-use conditions consistent with achieving land health fundamentals, unless otherwise agreed upon in writing or in the lease terms. If the holder fails to reclaim the site consistent with the requirements of the lease terms within a reasonable period, all authorization to use the associated public lands will terminate, but that shall not relieve the holder of liability for the cost of reclaiming the site.

(a) Bonding obligations. (1) Prior to the commencement of surface-disturbing or active management activities, the authorized officer may require the restoration or mitigation lease holder to submit a reclamation, decommission, or performance bond conditioned upon compliance with all the terms and conditions of the lease covered by the bond, as described in this subpart. For mitigation leases, the lease holder will usually be required to provide letters of credit or establish an escrow account for the full amount needed to ensure the development plan meets all performance criteria. The bond amounts shall be sufficient to ensure reclamation of the restoration and mitigation lease area(s) and the restoration of any lands or surface waters adversely affected by restoration or mitigation lease operations. Such restoration may be required after the abandonment or cessation of operations by the restoration or mitigation lease holder in accordance with, but not limited to, the standards and requirements set forth by authorized officers.

(2) Considerations for requiring a bond include, but are not limited to:

(i) The type and level of active restoration;

(ii) Amount and type of surface disturbing activity;

(iii) Proposed use of non-natural restoration methods, such as the use of pesticides;

(iv) Proposed use of experimental methods of restoration;

(v) Risk of compounding effects resulting from restoration activities, such as a proliferation of invasive species; and

(vi) Fire risk.

(3) Surety bonds shall be issued by qualified surety companies certified by the Department of the Treasury.

(4) Personal bonds shall be accompanied by:

(i) Cashier's check;

(ii) Certified check; or

(iii) Negotiable Treasury securities of the United States of a value equal to the amount specified in the bond. Negotiable Treasury securities shall be accompanied by a proper conveyance to the Secretary of full authority to sell such securities in case of default in the performance of the terms and conditions of a conservation use authorization.

(b) In lieu of bonds for each individual restoration or mitigation lease, holders may furnish a bond covering all restoration or mitigation leases and operations in any one State. Such a bond must be at least $25,000 and must be sufficient to ensure reclamation of all of the holder's restoration or mitigation lease area(s) and the restoration of any lands or surface waters adversely affected by restoration or mitigation lease operations in the State.

(c) All bonds shall be filed in the proper BLM office on a current form approved by the Office of the Director. A single copy executed by the principal or, in the case of surety bonds, by both the principal and an acceptable surety is sufficient. Bonds shall be filed in the Bureau State Office having jurisdiction of the restoration or mitigation lease covered by the bond.

(d) Default.

(1) Where, upon a default, the surety makes a payment to the United States of an obligation incurred under a restoration or mitigation lease, the face amount of the surety bond or personal bonds and the surety's liability thereunder shall be reduced by the amount of such payment.

(2) After default, where the obligation in default equals or is less than the face amount of the bond(s), the principal shall either post a new bond or restore the existing bond(s) to the amount previously held or a larger amount as determined by authorized officers. In lieu thereof, the principal may file separate or substitute bonds for each conservation use covered by the deficient bond(s). Where the obligation incurred exceeds the face amount of the bond(s), the principal shall make full payment to the United States for all obligations incurred that are in excess of the face amount of the bond(s) and shall post a new bond in the amount previously held or such larger amount as determined by authorized officers. The restoration of a bond or posting of a new bond shall be made within 6 months or less after receipt of notice from authorized officers.

(3) Failure to comply with these requirements may:

(i) Subject all leases covered by such bond(s) to termination under the provisions of this title;

(ii) Prevent the bond obligor or principal from acquiring any additional restoration or mitigation leases or interest therein under this subpart; and

(iii) Result in the bond obligor or principal being referred to the suspension and debarment program under 2 CFR part 1400 to determine if the entity will be suspended or debarred from doing business with the Federal Government.

(a) Authorized officers must:

(1) Identify priority watersheds, landscapes, and ecosystems that require protection and restoration efforts (see §§ 6102.2 and 6102.3.1);

(2) Develop and implement plans and strategies, including protection, restoration, and mitigation strategies that effectively manage public lands to protect and promote resilient ecosystems (see §§ 6102.1, 6102.3.1, 6102.5.1, 6103.1.2);

(3) Develop and implement monitoring and adaptive management strategies for maintaining sustained yield of renewable resources, accounting for changing landscapes, fragmentation, invasive species, and other disturbances (see § 6103.2);

(4) Report annually on the results of land health evaluations, and determinations (see § 6103.1.2);

(5) Ensure that watershed condition assessments incorporate consistent analytical approaches (see § 6103.2) both among neighboring BLM State Offices and with the fundamentals of land health; and

(6) Share watershed condition assessments in a publicly available national database to determine changes in watershed condition and record measures of success based on conservation and restoration goals.

(b) In taking management actions, and as consistent with applicable law and resource management plans, such as where an area is managed for recreation or is degraded land prioritized for development, authorized officers must:

(1) Make every effort to avoid authorizing uses of the public lands that permanently impair ecosystem resilience;

(2) Promote opportunities to support conservation and other actions that work toward achieving land health standards and ecosystem resilience;

(3) Issue decisions that promote the ability of ecosystems to passively recover or the BLM's ability to actively restore ecosystem composition, structure, and function;

(4) Meaningfully consult with Indian Tribes and Alaska Native Corporations during the decision-making process on actions that are determined, after allowing for Tribal input, to potentially have a substantial effect on the Tribe or Corporation;

(5) Allow State, Tribal, and local agencies to serve as joint lead agencies consistent with 40 CFR 1501.7(b) or as cooperating agencies consistent with 40 CFR 1501.8(a) in the development of environmental impact statements or environmental assessments;

(6) Respect Indigenous Knowledge, by:

(i) Improving engagement and expanding co-stewardship of public lands with Tribal entities;

(ii) Encouraging Tribes to suggest ways in which Indigenous Knowledge can be used to inform the development of alternatives, analysis of effects, and when necessary, identification of mitigation measures; and

(iii) Communicating to Tribes in a timely manner and in an appropriate format how their Indigenous Knowledge was included in decision-making, including addressing management of sensitive information;

(7) Seek opportunities to restore or protect ecosystem resilience when the effects of potential uses are unknown; and

(8) Provide justification for decisions that may impair ecosystem resilience.

(c) Authorized officers must use high-quality inventory, assessment, and monitoring data, as available and appropriate, to evaluate resource conditions and inform decision-making across program areas (see § 6103.2(c)), specifically by:

(1) Identifying clear goals or desired outcomes relevant to the management decision;

(2) Gathering high-quality information relevant to the management decision, including standardized quantitative monitoring data and data about land health;

(3) Selecting relevant indicators for each applicable management question (e.g., land health standards, restoration effectiveness, assessments of intactness);

(4) Establishing a framework for translating indicator values to condition categories (such as quantitative monitoring objectives or science-based conceptual models); and

(5) Summarizing results and ensuring that a clear and understandable rationale is documented, explaining how the data were used to make the decision.

(a) The BLM will apply the mitigation hierarchy to avoid, minimize, and compensate, as appropriate, for adverse impacts to resources when authorizing uses of public lands. As appropriate, the authorized officer may identify specific mitigation approaches or requirements to address resource impacts through land use plans or in other decision documents.

(b) For important, scarce, or sensitive resources, authorized officers shall apply the mitigation hierarchy with particular care, with the goal of eliminating, reducing, and/or offsetting impact on the resource, consistent with applicable law.

(c) When implementing the mitigation hierarchy, including authorizing mitigation leases, the BLM will:

(1) Use a landscape-scale approach to develop and implement mitigation strategies that identify mitigation needs and opportunities in a geographic area, including opportunities for the siting of large, market-based mitigation programs or projects (e.g., mitigation banks) on public lands;

(2) Use high-quality information to inform the identification and analysis of adverse impacts, to determine appropriate mitigation programs or projects for those impacts, and to achieve appropriate and effective mitigation outcomes;

(3) Require identification of performance criteria for mitigation programs or projects, effectiveness monitoring of those performance criteria, and reports that assess the achievement of those performance criteria;

(4) Use adaptive management principles to guide and improve mitigation outcomes; and

(5) Ensure that any compensatory mitigation programs or projects are commensurate with the applicable adverse impacts and that the required compensatory mitigation programs and projects are durable, additional, and timely.

(6) As used in this section, the terms additional, commensurate, durable, and timely have the following definitions:

(i) Additional means the compensatory mitigation program or project's benefit is demonstrably new and would not have occurred without the compensatory mitigation measure.

(ii) Commensurate means the compensatory mitigation program or project is reasonably related and proportional to the adverse impact from authorizing uses of public lands.

(iii) Durable means the maintenance of the effectiveness of a mitigation program or project, including resource, administrative, and financial considerations.

(iv) Timely means the lack of a time lag between the impact to the resources and the achievement of the outcomes of the associated compensatory mitigation.

(d) The BLM may approve, through a formal agreement, a third-party mitigation fund holder to administer funds for the implementation of compensatory mitigation programs or projects. A BLM-approved third-party mitigation fund holder may:

(1) Collect mitigation funds from permittees;

(2) Manage funds in accordance with agency decision documents, use authorizations and applicable law; and

(3) Disperse those funds in accordance with agency decision documents, use authorizations, and applicable law.

(e) Approved third-party mitigation fund holders must file with the BLM annual fiscal reports. To qualify as a third-party mitigation fund holder, the entity must either:

(1) Qualify for tax-exempt status in accordance with Internal Revenue Code section 501(c)(3); provide evidence that they can successfully hold and manage mitigation accounts; be a public charity bureau for the State in which the mitigation area is located, or otherwise comply with applicable State laws; be a third party organizationally separate from and having no corporate or family connection to the entity accomplishing the mitigation program or project, BLM employees, or the permittee; adhere to generally accepted accounting practices that are promulgated by the Financial Accounting Standards Board, or any successor entity; and have the capability to hold, invest, and manage the mitigation funds to the extent allowed by law; or

(2) Be a State or local government agency, if the government agency is able to demonstrate, to the satisfaction of the BLM, that:

(i) it is acting as a fiduciary for the benefit of the mitigation project or site and can show that it has the authority and ability to collect the funds, protect the account from being used for purposes other than the management of the mitigation project or site, and disburse the funds to the entities conducting the mitigation project or management of the mitigation site;

(ii) it is organizationally separate from and has no corporate or family connection to the entity accomplishing the mitigation program or project, BLM employees, or the permittee; and

(iii) it adheres to generally accepted accounting practices that are promulgated by the Governmental Accounting Standards Board or any successor entity.

(f) Authorized officers will require mitigation leases and collect annual rent at fair market value for large or otherwise substantial compensatory mitigation programs or projects on public lands, including mitigation banks and in-lieu fee programs. Mitigation leases may be required for other compensatory mitigation projects on public lands at the discretion of the authorized officer.

(g) In addition to the general requirements for mitigation leases (§ 6102.4), in some circumstances, authorized officers may require that mitigation lease holders submit to the agency a formal agreement with a qualified mitigation fund holder as defined in paragraph (d) of this section.

(h) An application for a mitigation lease for a mitigation bank or an in-lieu fee program, in addition to the requirements in (§ 6102.4(c)), must also include sufficient information about the anticipated demand for and duration of the mitigation bank or in-lieu fee program, the anticipated types of mitigation projects that will be conducted, and the methods that will be used to generate, evaluate, assess, and maintain the mitigation projects.

(i) Authorized officers will ensure that compensatory mitigation programs and projects, including those with mitigation leases, are tracked in the appropriate BLM data systems.