(a) Submission of contract applications. Applicants may submit an application for CSP at any time to enroll all of the eligible land included in their agricultural operation.

(b) Stewardship threshold requirement. To be eligible to participate in CSP, an applicant must submit to NRCS for approval, a contract offer for the agricultural operation that—

(1) Demonstrates that the applicant's conservation activities, at the time of contract offer, meet or exceed the stewardship threshold for at least two priority resource concerns; and

(2) Would, at a minimum, meet or exceed the stewardship threshold for at least one additional priority resource concern by the end of the conservation stewardship contract by:

(i) Installing and adopting additional conservation activities; and

(ii) Improving, maintaining, and managing existing conservation activities across the entire agricultural operation in a manner that increases or extends the conservation benefits in place at the time the contract application is accepted by NRCS; and

(3) Provides a map, aerial photograph, or overlay that—

(i) Identifies the applicant's agricultural operation; and

(ii) Delineates eligible land with associated acreage amounts.

(c) Evaluation of contract applications. NRCS will conduct one or more ranking periods each fiscal year.

(1) To the extent practicable, one ranking period will occur in the last quarter of the previous fiscal year or the first quarter of the current fiscal year.

(2) In evaluating CSP applications for new enrollment or for renewal, NRCS will rank applications based on the following factors:

(i) The natural resource conservation and environmental benefits that result from the conservation treatment on all State identified priority resource concerns at the time of submission of the application;

(ii) The degree to which the proposed conservation activities increase natural resource conservation and environmental benefits; and

(iii) Other consistent criteria, as determined by NRCS, including criteria the Chief determines are necessary to ensure that national, State, and local priority resource concerns are effectively addressed.

(3) In the event that two or more applications receive the same ranking under paragraph (c)(2) of this section, NRCS shall rank those contracts based on the extent to which the actual and anticipated conservation benefits from each contract are provided at the lowest cost relative to other similarly beneficial contract offers.

(4) NRCS may not assign a higher priority to any application because the applicant is willing to accept a lower payment than the applicant would otherwise be eligible to receive.

(d) Ranking pools. States will establish ranking pools in accordance with § 1470.2(d)(1).

(1) Nonindustrial private forest land (NIPF) applications will compete in separate ranking pools. An applicant with both NIPF and other eligible land may submit one application for NIPF and one application for all other eligible land.

(2) Within each State or established ranking pool, NRCS will address conservation access for certain farmers or ranchers, including—

(i) Socially disadvantaged farmers or ranchers;

(ii) Beginning farmers or ranchers;

(iii) Producers who are veteran farmers or ranchers; and

(iv) Organic producers or producers who are transitioning to organic.

(e) Application preapproval. NRCS will make application preapproval determinations throughout the fiscal year based on eligibility and ranking score.

(f) Field verification. NRCS will conduct onsite field verification prior to entering into a conservation stewardship contract to substantiate the accuracy of the information provided by applicants during the application process and to verify applicability of planned conservation activities.

(a) After NRCS approves the application and develops the conservation stewardship plan in accordance with § 1470.22, NRCS will enter into a conservation stewardship contract with the participant to enroll the participant's agricultural operation in the program.

(b) The conservation stewardship contract will—

(1) Be for a period of 5 years;

(2) Incorporate by reference the conservation stewardship plan;

(3) State the payment amount NRCS agrees to make to the participant annually, subject to the availability of funds;

(4) Incorporate all provisions as required by law or statute, including requirements that the participant will—

(i) Implement the conservation stewardship plan as described in § 1470.22;

(ii) Operate and maintain conservation activities on the agricultural operation consistent with § 1470.23;

(iii) Comply with the terms of the contract or documents incorporated by reference into the contract;

(iv) Refund as determined by NRCS, any program payments received with interest, and forfeit any future payments under the program, upon the violation of a term or condition of the contract, consistent with § 1470.27;

(v) Refund as determined by NRCS, all program payments received with interest, upon the transfer of the right and interest of the participant, in land subject to the contract, unless the transferee of the right and interest agrees to assume all obligations of the contract, consistent with § 1470.25;

(vi) Maintain and supply information as requested by NRCS, to determine compliance with the conservation stewardship plan and any other requirements of the program; and

(vii) Not conduct any activities on the agricultural operation that would tend to defeat the purposes of the program, as determined by NRCS;

(5) Permit all economic uses of the eligible land that—

(i) Maintain the agricultural or forestry nature of the land; and

(ii) Are consistent with the conservation purposes of the contract;

(6) Include a provision to ensure that NRCS will not consider a participant in violation of the contract for failure to comply with the contract due to circumstances beyond the control of the participant, including a disaster or related condition, as determined by NRCS; and

(7) Include such other provisions as NRCS determines necessary to ensure the purposes of the program are achieved.

(a) NRCS will use the conservation planning process as outlined in the NRCS “National Planning Procedures Handbook” to encourage participants to address resource concerns in a comprehensive manner.

(b) The conservation stewardship plan will contain a record of the participant's objectives and decisions to meet or exceed stewardship thresholds for identified resource concerns through implementation or adoption of one or more conservation activities. The plan will document the schedule of conservation activities to be implemented, managed, or improved under the conservation stewardship contract.

(c) Supporting documentation for the participant's plan will include—

(1) Identification and inventory of priority resource concerns;

(2) Establishing benchmark data on the condition of existing conservation activities at the time of enrollment;

(3) A plan map delineating the agricultural operation included in the program contract with associated acreage amounts;

(4) For organic producers or producers transitioning to organic production, documentation that supports the participant's transition to or participation in the National Organic Program; and

(5) Other information as determined appropriate by NRCS.

Throughout the conservation stewardship contract period, the participant will maintain and manage existing conservation activities across the entire agricultural operation to at least the benchmark level of conservation performance identified at the time of enrollment for the conservation stewardship contract period. The participant will also maintain and manage additional activities installed and adopted under the conservation stewardship contract.

(a) Annual payments. Subject to the availability of funds, NRCS will provide, as appropriate, annual payments under the program to compensate a participant for installing and adopting additional conservation activities, and for improving, maintaining, and managing existing conservation activities across the entire agricultural operation in a manner that increases or extends the conservation benefits in place at the time NRCS accepts the contract offer. A split-rate annual payment structure is used to provide separate payments for additional and existing conservation activities in order to place emphasis on implementing additional conservation.

(1) NRCS will make equal annual payments for the existing activity portion of the payment, specific to the operation, based on the land uses and NRCS assessment of existing stewardship. NRCS will make payments for the additional conservation activities based on the complexity and extent of the individual activities completed by the participant during the previous fiscal year. Additional activities implemented may vary from year to year, so the total annual payment may fluctuate;

(2) In order to receive an annual payment for a land use, participants must schedule, install, and adopt at least one additional conservation activity on the land use type;

(3) At least one additional conservation activity must be implemented within the first 12 months of the contract. NRCS may extend this timeframe if NRCS determines that the participant is unable to complete the conservation activity for reasons beyond their control;

(4) NRCS will base the annual payment rates, to the maximum extent practicable, on the following factors:

(i) Costs incurred by the participant associated with planning, design, materials, installation, labor, management, maintenance, or training;

(ii) Income foregone by the participant;

(iii) Expected conservation benefits;

(iv) The extent to which priority resource concerns will be addressed through the installation and adoption of conservation activities on the agricultural operation;

(v) The level of stewardship in place at the time of application and maintained over the term of the contract;

(vi) The degree to which the conservation activities will be integrated across the entire agricultural operation for all State identified priority resource concerns over the term of the contract; and

(vii) Such other factors as determined by the Chief; and

(5) Participants will receive payments for cover crop activities at not less than 125 percent of the annual payment amount, as determined by NRCS.

(b) Supplemental payments. Subject to the availability of funds, NRCS will provide a supplemental payment to a participant receiving annual payments, who also agrees to adopt or improve a resource-conserving crop rotation or adopt advanced grazing management, as defined by NRCS, to achieve beneficial crop or grazing rotations as appropriate for the eligible land of the participant.

(1) NRCS will determine whether a resource-conserving crop rotation or advanced grazing management is eligible for supplemental payments based on whether the resource-conserving crop rotation or advanced grazing management is designed to provide natural resource conservation and production benefits;

(2) A participant must adopt or improve the resource-conserving crop rotation or adopt advanced grazing management during the term of the contract to be eligible to receive a supplemental payment;

(3) Supplemental payments will be based, to the maximum extent practicable, on the factors from paragraph (a)(4) of this section; and

(4) Supplemental payments will be not less than 150 percent of the annual payment amount, as determined by NRCS.

(c) Comprehensive conservation plan. Participants choosing to develop a comprehensive conservation plan through their conservation stewardship contract will receive a one-time payment for this activity. NRCS will determine the payment based on the number of priority resource concerns addressed in the comprehensive conservation plan and the number of types of land uses included in the plan. Participants will not be eligible to receive payment for plans developed prior to their enrollment in a conservation stewardship contract.

(d) Minimum contract payment. NRCS may make a minimum contract payment to a participant in any fiscal year in which the contract's payment amount total is less than a rate determined equitable by the Chief based upon the effort required by a participant to comply with the terms of the contract.

(e) Timing of payments. NRCS will make payments as soon as practicable after October 1 of each fiscal year for activities carried out in the previous fiscal year. For newly enrolled contracts, NRCS will make payments as soon as practicable after October 1 following the fiscal year of enrollment.

(f) Noncompensatory matters. NRCS will not provide a CSP payment to a participant for—

(1) New conservation activities applied with financial assistance through other USDA conservation programs;

(2) The design, construction, or maintenance of animal waste storage or treatment facilities, or associated waste transport or transfer devices for animal feeding operations;

(3) Conservation activities for which there is no cost incurred or income foregone by the participant; or

(4) New conservation activities initiated or implemented prior to contract approval, unless NRCS granted a waiver prior to the participant starting the activity.

(g) Payment limits. A person or legal entity may not receive, directly or indirectly, payments that, in the aggregate, exceed $200,000 under all CSP contracts entered into during fiscal years 2019 through 2023, excluding funding arrangements with Indian Tribes, regardless of the number of contracts entered into under the CSP by the person or legal entity.

(h) Contract limits. Each conservation stewardship contract will be limited to $200,000 over the term of the contract period, except that conservation stewardship contracts with any joint operation will be limited to $400,000 over the term of the contract period.

(i) Scope of payment and contract limitations for Indian Tribes and individual Tribal members. Contracts with Indian Tribes are not subject to payment or contract limitations but payment limitations in paragraph (f) of this section apply to individual Tribal member(s). Indian Tribes and the Bureau of Indian Affairs will certify in writing that no one individual, directly or indirectly, will receive more than the payment limitation. Certification provided at the time of enrollment will cover the entire contract period. The Tribal entity must also provide, upon request from NRCS, a listing of individuals and payment made, by Social Security number or other unique identification number, during the previous year for calculation of overall payment limitations.

(j) Tax Identification Number. To be eligible to receive a CSP payment, all applicants must provide a tax identification number. In accordance with 7 CFR part 1400, applicants who participate as a legal entity or joint operation must provide a list of all members of the legal entity or joint operation and associated embedded entities, along with the members' Social Security numbers and percentage interest in the legal entity or joint operation. NRCS attributes payments directly to legal entity members for the purpose of complying with paragraph (f) of this section.

(k) Unique identification numbers. American Indians, Alaska Natives, and Pacific Islanders may use another unique identification number for each individual eligible for payment. Any participant that uses a unique identification number as an alternative to a tax identification number will use that identifier for all CSP contracts in which they participate.

(a) NRCS may modify a conservation stewardship contract, if—

(1) The participant agrees to the modification; and

(2) NRCS determines the modification is in the public interest.

(b) NRCS may allow modification to a conservation stewardship contract to accommodate certain changes in the agricultural operation, including—

(1) Removing contract acres the participant will enroll in CRP, protect with a wetland reserve easement through the Agricultural Conservation Easement Program (ACEP), or enroll in other Federal or State programs that offer greater natural resource protection through an easement, long-term contract, land use restrictions, or similar authority as determined by NRCS. NRCS may reduce payments for such modified contracts to reflect the modified acreage and performance. Participants will not be subject to liquidated damages or refund of payments received for enrolling land in these programs.

(2) Accommodating other limited changes, in response to a participant's request made prior to implementing the change, that would take land out of production or convert an area under contract to a different land use. These situations apply only to land for which the participant has and will retain effective control, and not for situations of involuntary loss of land.

(3) Allowing a participant to substitute a conservation activity as long as the level of conservation performance agreed to at the time of enrollment remains the same or is improved with implementation of the substitute activity.

(i) Adjustments to existing activities may occur consistent with conservation performance requirements from § 1470.23.

(ii) [Reserved]

(4) Prior to approval, NRCS must determine that any modification under this section is authorized by the provisions of 16 U.S.C. 3838d-3838g.

(c) A contract modification under this section will not increase the scheduled annual payments under the program, except to make minor adjustments to a conservation activity, as determined by NRCS; implement an appeal determination; correct an administrative error as approved by NRCS; or to adjust payment limitations. Contracts transferred from an individual or entity to a joint operation will retain the original contract limit outlined in § 1470.24(h).

(d) Within the time specified in the contract, a participant must provide NRCS with written notice regarding any voluntary or involuntary loss of control of any acreage under the CSP contract, which includes changes in a participant's ownership structure or corporate form. Failure to provide timely notice may result in termination of the entire contract.

(e) Unless NRCS approves a transfer of contract rights under this paragraph (e), a participant losing control of any acreage may constitute a violation of the CSP contract and NRCS may terminate the contract and require a participant to refund all or a portion of any financial assistance provided. NRCS may approve a transfer of the contract if—

(1) NRCS receives written notice that identifies the new producer who will take control of the acreage, as required in paragraph (d) of this section;

(2) The new producer meets program eligibility requirements within a reasonable time frame, as specified in the CSP contract;

(3) The new producer agrees to assume the rights and responsibilities for the acreage under the contract; and

(4) NRCS determines that the purposes of the program will continue to be met despite the original participant's losing control of all or a portion of the land under contract.

(f) Until NRCS approves the transfer of contract rights, the new producer is not a participant in the program and may not receive payment for conservation activities commenced prior to approval of the contract transfer.

(g) NRCS may not approve a contract transfer and may terminate the contract in its entirety if NRCS determines that the loss of control of the land was voluntary, the new producer is not eligible or willing to assume responsibilities under the contract, or the purposes of the program cannot be met.

(h) In the case of death, incompetency, or disappearance of any participant, NRCS may, as identified in the CSP contract—

(i) Terminate the contract;

(ii) Make any payments due under this part pursuant to guidance under applicable provisions of 7 CFR parts 707 and 1400 (including payment to successor(s)); or

(iii) Take any further action that the Chief determines is fair and reasonable in light of all of the circumstances.

(a) During the first half of the fifth year of the initial contract period, NRCS may allow a participant to apply and compete for the opportunity under § 1470.20 to renew the contract to receive payments for an additional 5-year period, subject to the availability of funds, if the participant meets criteria from paragraph (b) of this section.

(b) To be considered for contract renewal, the participant must—

(1) Be in compliance with the terms of their existing contract as determined by NRCS;

(2) Add any newly acquired eligible land that is part of the agricultural operation that NRCS determines must be included in the renewal contract;

(3) Agree to adopt and continue to integrate new or improved conservation activities across the entire agricultural operation, demonstrating continued improvement during the additional 5-year period, as determined by NRCS; and

(4) By the end of the renewal contract period, agree to meet or exceed the stewardship threshold of at least two additional priority resource concerns on the agricultural operation; or to adopt or improve conservation activities, as determined by NRCS, to achieve higher levels of conservation performance with respect to not less than two existing priority resource concerns that are specified by the Chief in the initial contract.

(c) NRCS will determine a participant ineligible for a new CSP contract on an agricultural operation for 2 years following expiration of their prior contract if the participant does not enter a renewal contract on the agricultural operation at the end of the prior contract period.

(a) NRCS may terminate a contract:

(1) Without the consent of the participant where NRCS determines that the participant—

(i) Violated the contract; or

(ii) Is unable to comply with the terms of the contract as the result of conditions beyond their control.

(2) With the consent of the participant if NRCS determines that the termination is in the public interest. NRCS will not assess liquidated damages for contracts terminated under this basis.

(b) When NRCS terminates a contract in accordance with paragraph (a) of this section, NRCS may allow a participant to retain payments already received based on—

(1) The level of effort the participant has made to comply with the contract. NRCS may require a participant to provide only a partial refund of the payments received if a previously installed conservation activity has achieved the expected conservation performance improvement, is not adversely affected by any contract violation or the absence of other conservation activities that would have been installed under the contract, and has met the associated operation and maintenance requirement of the activity; or

(2) Hardship situations where circumstances beyond the participant's control prevented the participant from complying with the contract. Any hardship affecting the participant's ability to comply with the contract must not have existed at the time the contract was executed by the participant. Participants may submit a written request to NRCS, along with additional supporting documentation, for NRCS to consider granting a waiver of any requested repayment and/or assessment of liquidated damages.

(c) If NRCS determines that a participant is out of compliance with the contract terms or incorporated documents, NRCS will notify the participant to explain what the participant must do to regain compliance and the consequences for not correcting the violation. NRCS will give the participant reasonable time to complete all necessary corrective actions, not to exceed one year. NRCS may authorize additional time for the participant to complete the corrective actions if, during the initial period, the participant was unable to complete the corrective actions due to circumstances beyond their control. If a participant's contract continues in violation, NRCS may:

(1) Terminate the contract in accordance with paragraph (e) of this section; or

(2) Where NRCS determines the violation does not warrant termination, NRCS may require the participant to:

(i) Refund all or a portion of the payments provided; or

(ii) Agree to such adjustments to the contact terms as determined appropriate by NRCS.

(d) Notwithstanding the provisions of paragraph (c) of this section, NRCS will terminate a contract, effective immediately, upon a determination by NRCS that the participant:

(1) Has submitted false information or filed a false claim;

(2) Engaged in any act, scheme, or device for which NRCS found the participant ineligible for payments as provided in § 1470.36; or

(3) Incurred a contract violation that the participant cannot correct in a timeframe established by NRCS.

(e) If NRCS terminates a contract, the participant will forfeit all rights to future payments under the contract, pay liquidated damages, and refund all or part of the payments received, plus interest, except as otherwise noted in paragraph (b) of this section.

(a) The purpose of the grassland conservation initiative (GCI) is to assist producers in protecting grazing uses, conserving and improving soil, water, and wildlife resources, and achieving related conservation values by conserving eligible land through grassland conservation contracts.

(b) The GCI is applicable on eligible cropland for which base acres have been maintained by the FSA under section 1112(d)(3) of the Agricultural Act of 2014 (7 U.S.C. 9012(d)(3)).

(c) Producers with eligible land will have one-time election to enroll in the GCI during fiscal years 2019 through 2023. A producer may elect to enroll eligible acres in the GCI or under a general CSP contract. A producer with land eligible for the GCI may not have the same land enrolled under both a GCI and general CSP contract at the same time.

(d) Participants enrolled in the GCI must agree to meet or exceed the stewardship threshold for at least one priority resource concern before the end of the contract.

(e) A GCI plan shall:

(1) Encompass all enrolled land;

(2) Require adoption of conservation activities to address grassland resource concerns; and

(3) If crops are grown, require adoption of conservation activities that achieve conservation stewardship levels analogous to the land being planted or maintained in grass.

(f) The GCI contract will be for one 5-year term and will not be subject to renewal.

(g) GCI annual payments will be $18 per acre, not to exceed the acres enrolled in the GCI contract.

(1) GCI contracts are not subject to the payment limitations or contract limits provided in § 1470.24(f) and (g).

(2) GCI contracts are not eligible for supplemental payments as provided in § 1470.24(b).

(h) The participant may request to terminate their GCI contract at any time and retain payments already received under the contract.