AGRICULTURE, RURAL DEVELOPMENT, FOOD AND DRUG ADMINISTRATION AND RELATED AGENCIES APPROPRIATIONS FOR 2011 SUBCOMMITTEE OF THE COMMITTEE ON APPROPRIATIONS HOUSE OF REPRESENTATIVES ONE HUNDRED ELEVENTH CONGRESS . SECOND SESSION SUBCOMMITTEE ON AGRICULTURE, RURAL DEVELOPMENT, FOOD AND i DRUG ADMINISTRATION, AND RELATED AGENCIES - ROSA L. DELAURO, Connecticut, Chairwoman SAM FARR, California JACK KINGSTON, Georgia . . . ALLEN BOYD, Florida TOM LATHAM, Iowa SANFORD D. BISHOP, JR., Georgia JO ANN EMERSON, Missouri - LINCOLN DAVIS, Tennessee RODNEY ALEXANDER, Louisiana MARCY KAPTUR, Ohio . . . . . . . . MAURICE. D. HINCHEY, New York JESSE L. JACKSON, JR., Illinois NOTE: Under Committee Rules, Mr. Obey, aS Chairman of the Full Committee, and Mr. Lewis, as Ranking . . . Minority Member of the Full Committee, are authorized to sit as Members of all Subcommittees. . | MARTHA FOLEY, LESLIE BARRACK, CLIFF ISENBERG, and MATT SMITH, * , , , , , . Staff Assistants * . . . . . . . . . . ---> FY 2011 JUSTIFICATIONs of THE BUDGET ESTIMATES USDA ExPLANATORY NOTES volumE 2 Farm Service Agency ......................................~~~~ 3 Risk Management Agency ...................................... … 106 Commodity Credit Corporation ........................................................…. 127 Natural Resources Conservation Service ................................. … I63 Rural Development ........................................................................................... 325 Food and Nutrition Service ........................................ … 627 Foreign Agricultural Service ...........…~ 815 General Provisions ....................................................... * * * * * * * * * * * * * * . . . . . . . . . . . . . . . . . . . . . . : 887 ~ : * : ***** The University ed for the use of the Committee on Appropriations - |AY . . of Michigan May 13 200 Documents ... DEPOSITED BY Center TED STATES OF AMERICA AGRICULTURE, RURAL DEVELOPMENT, FOOD AND DRUG ADMINISTRATION, AND RELATED AGENCIES APPROPRIATIONS FOR 2011 HEARINGS BEFORE A SUBCOMMITTEE OF THE COMMITTEE ON APPROPRIATIONS HOUSE OF REPRESENTATIVES ONE HUNDRED ELEVENTH CONGRESS SECOND SESSION SUBCOMMITTEE ON AGRICULTURE, RURAL DEVELOPMENT, FOOD AND DRUG ADMINISTRATION, AND RELATED AGENCIES ROSA L. DELAURO, Connecticut, Chairwoman SAM FARR, California . JACK KINGSTON, Georgia ALLEN BOYD, Florida TOM LATHAM, Iowa SANFORD D. BISHOP, JR., Georgia JO ANN EMERSON, Missouri LINCOLN DAVIS, Tennessee RODNEY ALEXANDER, Louisiana MARCY KAPTUR, Ohio MAURICE D. HINCHEY, New York JESSE L. JACKSON, JR., Illinois NOTE: Under Committee Rules, Mr. Obey, as Chairman of the Full Committee, and Mr. Lewis, as Ranking Minority Member of the Full Committee, are authorized to sit as Members of all Subcommittees. MARTHA FOLEY, LESLIE BARRACK, CLIFF ISENBERG, and MATT SMITH, Staff Assistants PART 1C ** FY 2011 JUSTIFICATIONS OF THE BUDGET ESTIMLATES USDA EXPLANATORY NOTES VOLUME 2 Page Farm Service Agency ...................................................................... • - - - - - - - - - - - - - - - - - 3 Risk Management Agency ............................................................................... 106 Commodity Credit Corporation ..................................................................... 127 Natural Resources Conservation Service ................................................... 163 Rural Development ........................................................................................... 325 Food and Nutrition Service ........ …… 627 Foreign Agricultural Service .......................................................................... 815 General Provisions ............................................................................................ 887 Printed for the use of the Committee on Appropriations U.S. GOVERNMENT PRINTING OFFICE 55–087 - WASHINGTON : 2010 COMMITTEE ON APPROPRIATIONS DAVID R. OBEY, Wisconsin, Chairman NORMAN D. DICKS, Washington ALAN B. MOLLOHAN, West Virginia MARCY KAPTUR, Ohio - PETER J. VISCLOSKY, Indiana NITA. M. LOWEY, New York JOSE E. SERRANO, New York ROSA L. DELAURO, Connecticut JAMES P. MORAN, Virginia JOHN W. OLVER, Massachusetts ED PASTOR, Arizona DAVID E. PRICE, North Carolina CHET EDWARDS, Texas PATRICK J. KENNEDY, Rhode Island MAURICE D. HINCHEY, New York LUCILLE ROYBAL-ALLARD, California SAM FARR, California JESSE L. JACKSON, JR., Illinois CAROLYN C. KILPATRICK, Michigan ALLEN BOYD, Florida CHAKA FATTAH, Pennsylvania STEVEN R. ROTHMAN, New Jersey SANFORD D. BISHOP, JR., Georgia MARION BERRY, Arkansas BARBARA LEE, California ADAM SCHIFF, California MICHAEL HONDA, California BETTY MCCOLLUM, Minnesota STEVE ISRAEL, New York TIM RYAN, Ohio C.A. “DUTCH” RUPPERSBERGER, Maryland BEN CHANDLER, Kentucky DEBBIE WASSERMAN SCHULTZ, Florida CIRO RODRIGUEZ, Texas LINCOLN DAVIS, Tennessee JOHN T. SALAZAR, Colorado JERRY LEWIS, California C. W. BILL YOUNG, Florida HAROLD ROGERS, Kentucky FRANK R. WOLF, Virginia JACK KINGSTON, Georgia RODNEY P. FRELINGHUYSEN, New Jersey TODD TLAHRT, Kansas ZACH WAMP, Tennessee TOM LATHAM, Iowa ROBERT B. ADERHOLT, Alabama JO ANN EMERSON, Missouri KAY GRANGER, Texas MICHAEL K. SIMPSON, Idaho JOHN ABNEY CULBERSON, Texas MARK STEVEN KIRK, Illinois ANDER CRENSHAW, Florida DENNIS R. REHBERG, Montana JOHN R. CARTER, Texas RODNEY ALEXANDER, Louisiana KEN CALVERT, California JO BONNER, Alabama STEVEN C. LATOURETTE, Ohio TOM COLE, Oklahoma BEVERLY PHETo, Clerk and Staff Director USDA T U.S. Department of Agriculture 2011 BUDGET ExPLANATORY NOTES FOR COMMITTEE ON APPROPRIATIONS VOLUME 2 (1) 2 FY 2011 EXPLANATORY NOTES Volume 2 - Contents FARM AND FOREIGN AGRICULTURAL SERVICES Farm Service Agency................................................................................................ Risk Management Agency..........~~~~ ~~~~ Commodity Credit Corporation.…... NATURAL RESOURCES AND ENVIRONMENT Natural Resources Conservation Service............................ a • * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * RURAL DEVELOPMENT Rural Development........................... ........................~~~~ Rural Housing Service.......................................~ Rural Business - Cooperative Service....................................................................... Rural Utilities Service............................................ * * * * * * * * * * * *-------------- ~ - FOOD, NUTRITION, AND CONSUMER SERVICES Food and Nutrition Service....................................................................................... FOREIGN AGRICULTURAL SERVICE Foreign Agricultural Service..................................................................................... GENERAL PROVISIONS General Provisions ................................. ~ ...........----------..................... EXPIRING LEGISLATION 22 23 24 25 26 27 28 29 30 31 32 33 3 FY 2011 Explanatory Notes Farm Service Agency Table of Contents Page urpose Statement.................. A * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * 22-l tatement of Available Funds and Staff Years,............,,, * * * * * * * * * * * * * * * * * * * * * * * * * we w w a 4 s : * * * * * r s e s A 4 s a s t < * * * * * * * * * * * * * * * * * * * * * * * * * * 22-8 ermanent Positions by Grade and Staff Years...................................................................................... ... .22-9 assenger Vehicle Fleet Data................................................................................................................... 22-10 ALARIES AND EXPENSES Appropriations Language.…...….............................................................. 22-1 I Lead-off Tabular Statement....................................................................................................... 22-12 Project Statements...................................................... 4 * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * 22-13 Justifications.…..…..…. 22- : 5 Geographic Breakdown of Obligations and Staff-Years............................................................ 22-18 Classification by Objects ................................................... h = 0 * * * * * * * * * * * * * * * * * * tº g s = * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * if 22-19 Summary of Recovery Act Funding ....................................... * * * * * * * * * * * * * * * * * is 4 a tº tº e º e º a “ ºr * * * * * * * * * * * * * * * * * * * * * * 22–20 Status of Program....................................................................................... a w = e º a tº e = * 4 = 4 w w w 4 ºr * * * * * * * * * * * * * * 22g-l PROGRAMS tate Mediation Grants: Appropriations Language............................…...…................................................................... 22-2} Lead-off Tabular Statement....................................................................................................... 22-22 Project Statement.….…....…..….......…. ......22-22 Justifications … 22-22 Geographic Breakdown of Obligations................... * - e a * * * * * * * - 22-23 Classification by Objects ................................................................... tº º ſº º ſº t e º & sº * * * * * is tº º 4 ° 4 tº $ tº 0 . . . . . . . . . . . . . . . 22-24 Status of Program............................................... * * * * * * * * s p * * * * * * * * * * * * * * * * 22g-6 Grassroots Source Water Protection Program Appropriations Language.................................................................….........................…........ 22–25 Lead-off Tabular Statement....................................................................................................... 22–26 Project Statement...............…...…............…...............................................….......….. 22-26 Justifications............ 4 * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * 22-26 Classification by Objects .......................................................... ..........................................…. 22-26 Status of Program...............…....…....…..........................…......…...…. 22g-8 Dairy Indemnity Program: Appropriations Language....................... * * * * * * * * * a & © tº a º ºr ºf p * * * * * * g º y º 4 x * * * * * * * * * * * * * > * * * * * * * * * * * * * * * * * * * * A * * * 22–27 Lead-off Tabular Statement........................... ſº ºr s - 4 & a tº a s : * * * * * * * * * * * tº 4 & 9 g º - m a s g : tº a • * * * * * * * * * * * * * * * * * * * * tº it w w w w a u = * * * * * * * * * * 22–28 Project Statements...................................... tº a r * * * * * * * * * * * * * * * * q = w it a * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * s p * * * * * * * * * * * * * * * * * * * * * * * * 22–28 Justifications......................................….….…...…..................…...... * , s = 4 tº a s a s = * 22–28 Geographic Breakdown of Obligations.............. * * * * * * * * * r a s a s a 4 re e º a s gº w w = e e º a s m = * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * 22–29 Classification by Objects......................................................................................... tº e º s = * * * * * * * * * * * * * 22–29 Status of Program......................................................................... • * * * * * * * * * * * * * * * * * * * * * - w e º e s tº e a w ł w w = w w tº * * * * * * * 22g-9 Agricultural Credit Insurance Fund: Appropriations Language..................................................................…...................….... 22-30 Lead-off Tabular Statement............................................................... 6 * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * 22-3 | Project Statements....................................................................................................…... 22-32 Justifications........................................….....…... & p * * * * * * * * * * * * * * * * * * * * * * * * * * r s w w w = e º sº a tº a t w e º e º we w w w w w ł. 22-34 Geographic Breakdown of Obligations.............. * * * * * * * * * * * * * * * * * * * * * * * * * * * * 4 s a sº e º e s ºr tº e < e < * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * 22-36 Classification by Objects.................................................................................................….. 22-43 Summary of Recovery Act Funding................. * * * * * * * * * * * * * * * * * * * * * * * * * a w w w e º 'º - w = * * * * * * * * * * * * * * 22-44 Status of Program........................................................ tº e is a 2 & P tº º a tº a tº ſº w & P is a x * * * * > 0 & 8 º' tº w & tº a “ ºr a tº w w w y º sº a a v 4 is e º u • * * * * * * 22g-il Reforestation Pilot Program Appropriations Language......….........….................................................................................... 22-4 Lead-off Tabular Statement...................................................................................................... 22-4 Project Statement.….…. ......................................... 22-4 Justifications.…..….....…............ * * * * * * * * * * * * * * * * * * * * * * * g e s - a a s a tº e a w w a ...22-4 Classification by Objects .................................................................................. * * * * * * * * * * * w w w = a + v * * * * ...22-4 Status of Program.............................................. w w w r w w y w * * * * * * * * * * * * * * * * * * * * s tº a t w = a - a w a s e s - ...22g-l Emergency Conservation Program: Lead-off Tabular Statement............................................................... * * * * * * * * * * * * * • - - - - - ......22-4 Project Statements.................. * * * * * * * * * * * * * * * * * * * * * * * * * 4 w 4 & 9 & e º a a ºn e s w = w w w w a e w w w = w = w = w w w = e º a s tº w w 4 e s sº w w w w w w w e º sº a 4 s • * * 22-4 FY 2009 Outlays by Type of Disaster................... 4 * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * 4 * * * * * * * * * & e º º ºs e º a • * * * * * 22-4 Geographic Breakdown of Obligations...................................................................................... 22-5 Classification by Objects........................................................- - - - - - - - - . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22-5 Status of Program..….........…......…................................................................................ 22g-l. Agricultural Disaster Relief Trust Fund Lead-off Tabular Statement....................................................................................................... 22-5 Project Statements.…....…............................................................................................... 22-5 Classification by Objects ................................................................... • * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * ........22-5 Summary of Recovery Act Funding......... tº a s s = 4 w w w w w = w s e a e º s ºr * * * * * * * * * * * * * * * * * * * * * 4 * * * * * * * * * * * * 4 in a tº a tº s º ºs º º w tº a tº e º e s : * * * * * * * 22-5 Status of Program.................................. * a tº s = * * & e < * * * * * * * * * * * * * * * * * * * 4 = * * * * * * * * * * * * * * * x * * * * * * * * * * * * .......22g-l USDA Supplemental Assistance Program Lead-off Tabular Statement.................... * 22-5 Project Statement............................................ * * * * * * * * * * w = * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * ...........22-5 Classification by Objects........................................................................................................... 22-5 Status of Program................…..........….......................…...…...…...….... 22g-l Aquaculture Grant Program Summary of Recovery Act Funding.......................................................................................... 22-5 SUMMARY OF BUDGET AND PERFORMANCE - Statement of Goals and Objectives.......................... b. 4 w ł ºr º g p * * * * * e s - w w łr e º a 4- a t < * * * * * * * * * * * tº e º is 4 ~ * * * * * * * *. . . . . . . . . . . . .-- 22-6 Key Performance Outcomes and Measures ............................................................................... 22-6 Full Cost by Strategic Objective.............................. * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * w a tº a ºn 4 º' w tº w w w a v e º 'º a # e º 'º w = a + p & e 22-7 5 22-1 FARM SERVICE AGENCY Purpose Statement he Farm Service Agency (FSA) was established October 13, 1994, pursuant to the Department of griculture Reorganization Act of 1994, Public Law (P.L.) 103-354, as amended by the Federal Agriculture Improvement and Reform Act of 1996, P.L. 104-127. FSA's mission is to contribute to the viability of merican agriculture by providing efficient and equitable administration of farm commodity, farm loan, onservation, and emergency programs. FSA provides the personnel to carry out many of the programs unded by the Commodity Credit Corporation (CCC) and is responsible for the overall coordination of udgetary and fiscal matters of the CCC. SA administers programs authorized by the Food, Conservation, and Energy Act of 2008, P. L. 110-246 e 2008 Farm Bill), and a variety of other laws. Descriptions of the programs administered by FSA and unded by CCC appear in the CCC Purpose Statement in Section 18 of these Explanatory Notes. The ollowing is a summary of FSA's programs and activities funded by other sources, including appropriations, ransfers, and fees. Warm Loan Programs: FSA's farm loan programs provide a safety net for farmers and ranchers emporarily unable to obtain sufficient credit elsewhere to finance their operations at reasonable rates and ITT1S. ost farm loan programs administered by FSA are authorized by the Consolidated Farm and Rural evelopment Act, P.L. 87-128, August 8, 1961, as amended. Subtitle A of this act authorizes direct and uaranteed farm ownership, recreation, and soil and water loans. Subtitle B authorizes direct and uaranteed operating loans. Subtitle C authorizes emergency loans. The Agriculture Credit Improvement ct of 1992, P.L. 102-554, establishes special assistance to qualified beginning farmers and ranchers to nable them to conduct viable farming and ranching operations. Indian Tribe Land Acquisition Loans are uthorized by Public Law 91-229; April 11, 1970, as amended. The 2008 Farm Bill authorizes onservation Loans and Indian Fractionated Land Loans. he Agricultural Credit Insurance Fund Program Account was initiated in FY 1992, as required by the ederal Credit Reform Act of 1990. The account shows the direct loan obligations and guaranteed loan ommitments of FSA's farm loan programs and the associated subsidy costs. Subsidy costs are obtained by stimating the net present value of the Government's cash flows resulting from direct and guaranteed loans ade through this account. he programs funded by this account are: Farm Ownership Loans. FSA makes direct and guaranteed loans to family farmers to purchase farmland; restructure their debts, including utilizing their real estate equities to refinance heavy short- term debts; and make adjustments in their operations to comply with local sanitation and pollution abatement requirements, keep up with advances in agricultural technology, better utilize their land and labor resources, or meet changing market requirements Loans are made for 40 years or less. A direct loan may not exceed $300,000 and a guaranteed loan ... may not exceed $1,112,000, adjusted annually. The interest rate for direct loans is determined by the Secretary of Agriculture and does not exceed the cost of money to the Government plus up to 1 percent. However, loans to limited resource borrowers (farmers who need special supervision or who cannot afford the regular interest rate due to low income) bear interest of not more than one-half of the Treasury rate for marketable obligations with maturities of 5 years plus not more than 1 percentage point, with a floor of 5 percent. Effective with the 2008 Farm Bill, interest rates for beginning farmer 6 22–2 down-payment loans are established at 4 percent less than the regular borrower rate, with a floor of 1.5 percent. The interest rate for guaranteed loans is negotiated by the lender and borrower. At least 40 percent of the amounts appropriated for guaranteed farm ownership loans will be reserved for beginning farmers and ranchers during the first 6 months of the fiscal year. Also, at least 75 perce of the amount appropriated for direct farm ownership loans will be reserved for qualified beginning farmers and ranchers. Farm Operating Loans. Farm operating loans are targeted to family farmers unable to obtain credit from private sources and are accompanied by supervisory assistance in farm and financial managemen Operating loans may be made for paying costs incident to reorganizing a farming system for more profitable operations; purchasing livestock, poultry, and farm equipment; purchasing feed, seed, fertilizer, insecticides, and farm supplies and meeting other essential operating expenses; financing lan and water development, use, and conservation; developing recreation and other non-farm enterprises; and refinancing existing indebtedness. Farm operating loans are for periods of 1 to 7 years depending on loan purposes. The loan limit is $300,000 for a direct loan and $1,112,000, adjusted annually, for a guaranteed loan. The interest rate for direct loans is determined by the Secretary of Agriculture and does not exceed the cost of money tº the Government plus up to 1 percent. However, loans to limited resource borrowers bear interest of n more than one-half of the Treasury rate for marketable obligations plus not more than 1 percentage point, with a floor of 5 percent. The interest rate for guaranteed loans is negotiated by the lender and borrower and may be subsidized under the interest assistance program. In addition, the interest rate assistance program may also be sufficient to allow moderate-income borrowers to move from the direc loan program to the guaranteed loan program. The Agricultural Credit Improvement Act of 1992, Public Law 102-554, requires at least 50 percent o the amounts available for direct farm operating loans be reserved for qualified beginning farmers and ranchers during the first 9 months of the fiscal year, Emergency Loans. Emergency loans are made available in designated areas (counties) and in contiguous counties where property damage and/or severe production losses have occurred as a direct result of a natural disaster. Areas may be declared a disaster by the President or designated for emergency loan assistance by the Secretary of Agriculture, or by the FSA Administrator for physical loss loans only. Emergency loans are made to established, eligible, family-size farms and ranches (including equine farms and ranches) and aquaculture operators. Partnerships and private domestic corporations and cooperatives may also qualify, provided they are primarily engaged in agricultural or aquaculture production. Loans may be made only for actual losses arising from natural disasters. A farmer who cannot receive credit elsewhere is eligible for an actual loss loan of up to $500,000 or the calculated actual loss, whichever is iess, for each disaster, at an interest rate of 3.75 percent. Actual loss loans may be made to repair, restore, or replace damaged or destroyed farm property, livestock and livestock products, and supplies and to compensate for disaster-related loss of income based on reduced production of crops and/or livestock products. Eligible farmers may use actual loss loan funds to pay costs incident to reorganizing a farming system to make it a sound operation that is approximately equivalent in earning capacity to the operation conducted prior to the disaster. Under certain conditions, loan funds may be used to buy essential home equipment and furnishings and for limited refinancing of debts. 7 22-3 Repayment terms for actual loss loans vary according to the purposes of the loan, type of collateral available to secure the loan, and the projected repayment ability of the borrower. Loans for actual production or physical losses to crops, livestock, supplies, and equipment may be scheduled for repayment for up to 7 years. Under some conditions a longer repayment period may be authorized for production loss loans, but not to exceed 20 years. Generally, real estate will be needed as security when a loan term of more than 7 years is authorized. Loss loans for actual losses to real estate will generally be scheduled for repayment within 30 years but under some conditions may be scheduled for up to 40 years. - - Indian Tribe Land Acquisition Loans. These loans allow Native Americans to repurchase tribal lands and maintain ownership for future generations. They are limited to acquisition of land within the defined boundaries of a tribe's reservation. To be eligible, a tribe must be recognized by the Secretary of the Interior or be a tribal corporation established pursuant to the Indian Reorganization Act; in addition, a tribe must be without adequate funds to acquire the needed land and be unable to obtain sufficient credit elsewhere for the purchase. The tribe must also have a satisfactory management and repayment plan. Loans are made at 5 percent interest for a period not to exceed 40 years. Boll Weevil Eradication Loans. Boll weevil eradication loans provide assistance to producer associations and State governmental agencies to eradicate boll weevils. Loans are made in major cotton producing States. Credit Sales of Acquired Property. Loans are authorized for the sale of security properties previously acquired by FSA during the servicing of its loan portfolio. Loans for sales of acquired property have been financed under the direct farm ownership loan program since separate funding for credit sales has not been appropriated, º Conservation Loans. Loans for conservation projects must be part of a USDA-approved conservation plan. Eligible conservation plans may include projects for construction or establishment of conservation structures, forest and permanent cover, water conservation and waste management systems, improved permanent pasture, or other projects that comply with Section 1212 of the Food Security Act of 1985, and other purposes approved by Secretary. Eligible borrowers include farmers, ranchers, and other entities controlled by farmers and ranchers and primarily and directly engaged in agricultural production. The program gives priority to qualified beginning farmers, ranchers, socially disadvantaged farmers or ranchers, owners or tenants who use the loans to convert to sustainable or organic agricultural production systems, and producers who use the loans to build conservation structures or establish conservation practices. Loan guarantees are 75 percent of the principal amount of the loan, and loans are to be disbursed geographically to the maximum extent possible. Loans are made to borrowers unable to obtain credit elsewhere. - Indian Highly Fractionated Land Loans. As authorized by the 2008 Farm Bill, this program provides discretionary authority to make and insure loans to eligible purchasers of highly fractionated lands under relevant provisions of the Indian Land Consolidation Act. Eligible purchasers are Indian tribal members. - - Beginning Farmer and Rancher Individual Development Grant Accounts. The 2008 Farm Bill authorizes an Individual Development Account Pilot Program, which provides for matching-funds savings accounts for beginning farmers or ranchers to be used for specified farming-related expenses. Eligible beginning farmers and ranchers are defined as those that lack significant assets and have an income that is either below 80 percent of their State's median or below 200 percent of their State's poverty income guidelines. Eligible participants cannot receive more than $6,000 in matching funds for each fiscal year of contract. Participants must also complete financial training established by a qualified entity. 8 22-4 State Mediation Grants: Section 502 of the Agricultural Credit Act of 1987, P.L. 100-233, authorized the Secretary of Agriculture to help States develop and operate mediation programs to assist agricultural producers, their creditors, and other persons directly affected by the actions of USDA in resolving disputes confidentially, efficiently, and cost effectively compared to administrative appeals, litigation, and bankruptcy. Under the program, FSA makes grants to States to support mediation programs established under State statute and certified by FSA. Grants can be up to $500,000 annually, or 70 percent of the State's cost of operating its program for the year. Originally designed to address farm loan disputes, the program was expanded by the Department of Agriculture Reorganization Act of 1994, P.L. 103-354, to include other agricultural issues such as wetland determinations, conservatiºn compliance, rural water loan programs, grazing on National forest system lands, and pesticides. The Grain Standards and Warehouse Improvement Act of 2000, P.L. 106-472, clarified that certified State programs can provide mediation training and consulting services to producers, lenders, and USDA agencies. The program was extended through fiscal year 2010 by P.L. 109-17, enacted June 29, 2005. Emergency Conservation Program (ECP): ECP is authorized by Title IV of the Agricultural Credit Act of 1978 (P.L. 95-334), as amended in 1989 and 1996. ECP provides emergency cost-share assistance to farmers and ranchers to help rehabilitate farmland and ranchland damaged by natural disasters and to carry out water conservation measures during periods of severe drought. Cost-share assistance may be offered only for emergency conservation practices to restore land to a condition similar to that existing prior to the natural disaster. Dairy Indemnity Program (DIP): Since its inception under the Economic Opportunity Act of 1964, DIP has been extended by numerous acts. The program indemnifies dairy farmers and manufacturers of dairy products who, through no fault of their own, suffer income losses on milk or milk products removed from commercial markets because of residues of chemicals that, at the time of their use, were approved by the Federal Government as safe to use. Under the program, FSA may also reimburse dairy farmers for milk removed from commercial markets because of nuclear radiation, fallout, or certain other toxic substances. Grassroots Source Water Protection Program (GSWPP): The Grassroots Source Water Protection Program was reauthorized by the 2002 Act. This program is designed to help prevent source water pollution through voluntary practices installed by producers at the local level. Under the GSWPP, FSA utilizes onsite technical assistance capabilities of each State rural water association that operates a wellhead or groundwater protection program in the State. State rural water associations can deliver assistance in developing source water protection plans within priority watersheds for the common goal of preventing the contamination of drinking water supplies. Commercial Warehouse Activities: Under the United States Warehouse Act (USWA), first enacted in 1916 and most recently reauthorized by the Grain Standards and Warehouse Improvement Act of 2000, P.L. 106-472, FSA operates a nationwide, voluntary program, under which FSA licenses warehouse operators who store agricultural products. Under the USWA, FSA also licenses qualified persons to sample, inspect, weigh, and grade agricultural products. Entities which receive a USWA license must meet minimum financial standards and maintain physical warehouse facilities capable of handling and storing applicable agricultural commodities. In order to ensure compliance with the provisions of these licenses, FSA periodically makes unannounced examinations of the license holders. The USWA authorizes the use of user fees to cover the costs of administering that Act. End-Use Certificate Program: Under the North American Free Trade Agreement Implementation Act, FSA monitors the end use of wheat imported from Canada. Under the program, importers of Canadian wheat, regardless of ultimate use, must complete an end-use certificate. Transactions that occur Subsequent 9 22-5 o the entry of such wheat into the United States must be reported to FSA, and all purchasers must continue o report any consumption of such wheat. omestic and Export Commodity Procurement Activities: Procurement activities are governed by the ollowing legislation: National School Lunch Act, Sections 6(a) and (e), 13 and 17; Emergency Food ssistance Act of 1983, as amended; Agricultural Trade Development and Assistance Act of 1954 (Public aw 83-480, Title H), as amended; Food for Progress Act of 1985, as amended; and the Agricultural Act of 1949, Section 416(b), as amended. • Domestic Nutrition and Feeding Programs. FSA procures commodities for domestic food programs administered by the Food and Nutrition Service. These programs include the National School Lunch Program; elderly, disaster, and emergency feeding programs; food aid to Native Americans living on reservations; and other programs that help individuals in need. FSA also donates surplus Government- owned commodities for use in feeding programs, using CCC authority, when these products are available. • Foreign Food-Aid Humanitarian and Developmental Assistance Programs. FSA procures commodities for overseas humanitarian and developmental use for the Food for Progress and Section 416(b) programs, and under Title II of P.L. 480. Services for P.L. 480 are being provided on a reimbursable basis in FY 2009, and it is anticipated that the same will be the case in FY 2010. • Surplus Removal and Disaster and Food Assistance Programs. FSA procures commodities under Executive Order and congressional mandate for surplus removal and disaster and food assistance programs. In response to natural disasters, FSA distributes Government-owned food from warehouses and may make special purchases of food as part of the disaster relief effort, USDA Supplemental Assistance. The Agricultural Assistance Act of 2007, enacted as Title IX of P.L. 110-28, the U.S. Troop Readiness, Veterans’ Care, Katrina Recovery, and Iraq Accountability Appropriations Act, 2007, appropriated approximately $2.8 billion for disaster assistance for farmers and ranchers. Under this title, appropriations are provided for the Crop Disaster Program, Livestock Compensation Program, Livestock Indemnity Program, Emergency Conservation Program, and Dairy Disaster Assistance Program. The FY 2008 Consolidated Appropriations Act, P.L. 110-161, provided an additional $602 million. With the exception of the ECP, these programs are of the type historically funded by the CCC. In FY 2010 this account also includes three other programs authorized by the FY 2010 Agriculture Appropriations Act, P.L. 11 1-80. Section 748(a) provided $290 million for loss assistance payments to dairy producers under Section 10 104 of the 2002 Farm Bill. Eligible producers will receive a one-time direct payment based on the amount of milk produced and commercially marketed by their operation during the period February through July 2009, Section 741 of P.L. 111-80 provided appropriations for two additional programs: $3 million for a Durum Wheat Quality Program authorized by Section 1613 of the 2008 Farm Bill, P.L. 110-246, and $2.6 million for a Geographically Disadvantaged Farmers and Ranchers Program authorized by Section 1621 of the 2008 Farm Bill, Aquaculture Assistance. The American Recovery and Reinvestment Act of 2009, P.L. 1 1 1-5, authorizes no more than $50 million of Commodity Credit Corporation (CCC) funds for an Aquaculture Grant Program to provide assistance to eligible aquaculture producers for losses associated with high feed input costs during the 2008 calendar year, CCC provides block grants to State Departments of Agriculture or similar State government entities that agree to provide assistance to eligible aquaculture producers in their State. Grants to States will be pro rated based on the amount of aquaculture feed used in each State during the 2007 calendar year. Each State will conduct program signup for aquaculture producers in their State. Applicants who receive assistance under this program may not receive assistance under the 10 22-6 Supplemental Agricultural Disaster Assistance Programs for any losses in 2008 relating to the same species of aquaculture. Agricultural Disaster Relief Trust Fund. The 2008 Farm Bill provides for supplemental agricultural disaster assistance that includes the Agricultural Disaster Relief Trust Fund. The Fund is composed of amounts equivalent to 3.08 percent of the amounts received in the general fund of the U.S. Treasury during FY 2008-2011 attributable to the duties collected on articles entered, or withdrawn from warehouse, for consumption under the Harmonized Tariff Schedule of the U.S. The Fund has authority to borrow and has repayable advances that are such sums as may be necessary to make up the Fund's budget authority. The Trust Fund may be used to make payments to farmers and ranchers under five programs: • Supplemental Revenue Assistance Payments (SURE) Program provides assistance to eligible producers who are in counties that receive a natural disaster declaration by the Secretary and who have incurred crop production and/or quality losses during the crop year. • Livestock Forage Disaster Program (LFP) compensates producers for grazing losses resulting from drought-related conditions as well as grazing losses due to fire on public managed lands. • Livestock Indemnity Program (LIP) compensates producers for livestock losses that were the result of a natural disaster. • Emergency Assistance for Livestock, Honey Bees, and Farm-Raised Fish Program (ELAP) provides emergency relief to producers of livestock, honeybees, and farm raised fish to aid in the reduction of losses due to disease, adverse weather or other conditions determined by the Secretary that are not covered by LIP, LFP, or SURE. • Tree Assistance Program (TAP) assists eligible orchardists or nursery tree growers who suffered tree losses or damage as a result of a natural disaster. The program shares the cost of tree replanting, clean- up and debris removal, and rehabilitation, The 2008 Farm Bill requires that participants in these new disaster assistance programs have crop insurance or non-insured crop disaster assistance (NAP), or pay a fee if they are otherwise eligible. The ARRA amended the 2008 Farm Bill and the SURE Program to modify the payment formulas for 2008 crops. It also provided an additional 90-day window for 2008 crops for those producers who did not obtain a policy or plan of insurance or NAP coverage, or elect to buy in by September 16, 2008, as authorized under the 2008 Farm Bill. No obligations or outlays were incurred in FY 2008, and the budget authority totaling $832,951,063 was carried forward into FY 2009 as an unobligated balance. AGENCY STRUCTURE: FSA delivers its programs through approximately 2,248 USDA Service Centers, 50 State offices, and an area office in Puerto Rico. FSA has headquarters offices in Washington, DC, two field offices in Kansas City, an office in Salt Lake City, and a field office in St. Louis servicing farm loan programs, Personnel at the Washington headquarters office are responsible for program policy decisions, program design, and program oversight. Personnel at the Washington headquarters office and the Kansas City complex are responsible for financial management, IT support for program delivery, and commodity operations, FSA’s permanent, full-time, end-of-year Federal employment as of September 30, 2009, was 4,957. FSA non-Federal permanent employment in USDA Service Centers was 8,606. 11 22-7 SIG Reports: Number Title Report Date 0360 i-49-Te Socially Disadvantaged Borrower Foreclosures — Farm 6/8/2009 Program Loans 03601-1 6-At Tobacco Transition Payment Program – Producers 8/3/2009 Commodity Credit Corporation Financial Statements for 06401-24-Fm Fiscal Years 2009 and 2008 - { {f 12/2009 GAO Reports: Number Title Report Date Department of Agriculture, Commodity Credit GAO-09-890R Corporation: Direct and Counter-Cyclical Program and 7/21/2009 Average Crop Revenue Election Program GAO-09-89 i R Department of Agriculture, Commodity Credit 7/21/2009 Corporation: Sugar Program Department of Agriculture, Commodity Credit GAO-09-892R Corporation: Marketing Assistance Loans and Loan 7/21/2009 Deficiency Payments Department of Agriculture, Commodity Credit GAO-10-169R Corporation: Farm Storage Facility Loan and Sugar 10/28/2009 Storage Facility Loan Programs GAO-10-271R Department of Agriculture, Commodity Credit 12/1/2009 Corporation: Conservation Reserve Program Department of Agriculture, Farm Service Agency: GAO-10-272R Livestock Forage Disaster Program and Emergency H2/1/2009 Assistance for Livestock, Honeybees, and Farm-Raised Fish; Supplemental Agricultural Disaster Assistance 12 22 8 FARM SERVICE AGENCY Available Funds and Staff Years 2009 Actua d Estimated 2010 and 2011 Estimated 2011 ſterſ; Actual 2009 Estimated 2010 Staff Staff Staff Arnoisfit . Years Armount Years Amount Years Salarics & Expenses - Durect Appropriation $1,170,273,000 1,840 $1,253.777,000 1,965 $1,364,673,000 1.97 Transfer from Congressional Affairs 302,000 - O • * {} - Credit Reform Transfers - CCC Export Loans Program Accoun 348,000 2 355,000 2 359,000 P L 480 Program Account 2,736,000 24 2,812,000 24 2,846,000 2. ACIF Program Account 309,403,000 2,914 3 : 3.} 73,000 2,879 3 8.200,000 2.87. Subtotal, Salaries and Expenses 1,483,062,000 4,780 i.570, I 7,000 4,870 1,686,078,000 4,886 American Recovery and Reinvestment Act (ARRA) (IT) 14,687,000 * * 35,313,000 sº a 0 º Prior Year Recoveries - 1,264,000 • * 0 * * O {Jriobligated balance brought forward from FY 2008 30,846,000 * * () - - {} e Unobligated balance carried forward from FY 2009 for County - 1,329,000 * * | 1,529,000 * * 0. Unobligated balances carried forward from FY 2009 IT Purposes –21,646,000 * * 2}.646,000 s º O Total, Salaries and Expenses i,496,654,000 4,780 1,638,605,000 4,870 1,686,078,000 4,88t ACIF Program. Account Subsidy 220,027,000 O 142,791,000 0. $50,722,000 { ARRA 20,055,000 Q 385,000 O 0. { Administrative Expenses Non-Recoverable Loan Costs 6,786,000 O 7,920,000 () 7,920,000 { State Mediation Grants 4,369,000 O 4,369,000 0 4,369,000 .( Grassroots Source Water Protection Program 5,000,000 O 5,000,000 0 Q ſ FY 2009 ARRA Aquaculture Grants 48,500,000 O 1,500,000 0. Ö { Total. Above 1,804.391,000 0 i,800,570,000 O 1,849,089,000 f Obligations under other USDA appropriations Foreign Agricultural Service 5,409,000 39 5,257,000 39 5,409,000 39 Risk Management Agency 1,900,000 20 1,955,000 20 2,012,000 20 Food & Nutrition Service 2,428,000 2] 2,573,000 2} 2,573,000 2] Agricultural Marketing Service 1,761,000 35 1,380,000 { | 1,380,000 | | Natural Resources Conservation Service l,632,000 21 j,500,000 21 1,600,000 2] Flying Contracts 9,361,000 9 9500,000 9 9500,000 9 CCC to administer P L 480 Title iſ Grants 6,500,000 54 6,180,000 40 6,264,000 40 Farm Biłł (CCC) 39,718,000 O 7,531,000 O {} G Miscellaneous - • 60,083,000 0 54,318,000 0 $3,272,000 G Total. Other USDA Appropriations 128,392,000 199 90,294,000 | 6 | 82.919,000 § 6; Total. Agriculture Appropriations 1,929,883,000 4,979 1,890.864,000 5,034 },93}.099,000 5,04? Obligations under Other Federal Funds Sales of Aerial Photographs 313,000 4 322,000 4 334,000 4 Total, Other Federal Funds 313,000 4 322,000 4 33},000 4 Obligations under Non-Federal Funds - Loan Service Fee Financing 5,200,000 {} 5,000,000 0 5,000,000 Producer Measurement Service 1,71 #,000 0 1,700,000 O i,700,000 O Warehouse Examinations 3,354,000 54 3,471,000 54 3,47;,000 54 Sales of Aerial Photographs 451,000 5 464,000 5 478,000 5 Totai, Non-Fedcraft Funds ! 0,716,000 59 |0.635,000 59 10,649,000 5 Total, Farm Service Agency !,940,912,000 5,042 1991,821,998 5,094 ł,942,079,000 5, 104 FSA Non Federal county staff years (S/Y) are as follows - Direct Reimbursable Total S/Y FY 2009 9,142 276 9,448 FY 2010 9,349 276 9,425 FY 20 | 1 9, 149 276 9,425 Notes Wheat and Geographically Disadvantaged Farmers and Ranchers Programs, and Sec. 748(a), dairy loss payments - Also cxcludes mandatory funding for the Dairy indemnity Program Excludes the following programs funded for FY 2010 by P L \ 11 80 General Provisions Sec 739. Reforestation Pilot Program, Sec 74. Durum & —-Pºrservºire- Permanent Positions by Grade and Staff Year Summary 2009 Actual and Estimated 2010 and 2011 2009 2010 | 2011 Grade Wash DC Field Total Wash DC Feld Total | Wash DC Field Total Senior Executive Service 9 l 10 9 - l 10 9 | 10 GS 15 52 33 85 52 33 85 52 33 85 GS 14 º : | 56 ! 18 38| 156 ł 18 38. 1 S6 GS 13 23] 593 824 231 600 831 24 | 600 841 GS 12 80 },467 l,547 80 1,525 1,605 80 1,525 1,605 GS 11 23 717 740 23 717 740 23 717 740 GS 10 0 0 0 0 () 0 0 0 0 GS 9 19 277 296 19 277 296 19 277 296 GS 8 17 59 76 17 59 76 17 59 76 GS 7 41 973 1,014 41 973 1,014 41 973 1,014 GS 6 13 98 1 || || 13 98 1 | 1 ! 3 98 | | | GS 5 2 58 60 2 58; 60 2 58 60 GS 4 l 15 16 l 15 | 6 l 15 16 GS 3 0. 5 5 0 5 5 O 5 ... 5 GS 2 0 4 4 {} 4 4 0 4 4 Other Graded Positions ... . . 3 10 13 3 10 #3 3 | 0 13 Ungraded Positions O () () 0 0 0 O 0 0 Total Permanent : Positions..... . . 609 4,348 - 4,957 609 4,413 5,022 619 4,413} 5,032 Unfilled POSItions end-of-year 0. 0. 0 0. 0 0 {} () 0 Total, Permanent Full-Time Employment, end-of-year ... . . - * * 609 4,348 4,957 609 4,413 5,022 619 4,413 5,032 Staff-Year Estimate . ... ..... 1,585 3,457 5,042 1,554 3,540 so 1,564 3,540 5,104 ; T Farm Service Agency Size, Composition, and Annual Cost (in thousands of dollars) V Annual Sedans and Light Trucks, Medium Heavy Total Operating Station SUV's and { Duty Ambulances Buses Duty Number of Costs Fiscal Vans Vehicles Vehicles Vehicles II] Year 4X2 4X4 2008 I 2008 FY 2009 l from 2009 l/ #0 FY 20 ! I ; If FY 2010 and FY 2011 are estimates The majority of the State Offices use GSA Motor Pool services within their State for travel purposes These vehicles are used for different types of travel such as site visits, information meetings, training, speeches and presentations, conference attendance, relocation, special mission, emergency and other travel These vehicles are obtained from the nearest GSA Motor Pool with the approval of Management Services Division (MSD) Each State is assigned a Billing Office Address Code (BOAC) number, fund code and sales code by MSD * FSA owns all-terrain vehicles in Hawaii Neither private contractors nor the GSA Interagency Fleet Management System provides or maintains these types of vehicles The change from FY 2008 reflects an Increase in GSA leased vehicles FSA's GSA leased vehicles show an increase because the field offices are replacing their commercially leased vehicles with GSA leased vehicles The change from FY 2009 reflects an increase in annual operating costs due to increased gas prices nationwide 15 22-1 l FARM SERVICE AGENCY The estimates include proposed changes in the language of this item as follows (new language underscored; deleted matter enclosed in brackets): Salaries and Expenses (Including Transfers of Funds): For necessary expenses of the Farm Service Agency, [$1,253,777,000) $1,364,673,000: Provided, That the Secretary is authorized to use the services, facilities, and authorities (but not the funds) of the Commodity Credit Corporation to make program payments for all programs administered by the Agency: Provided further, That other funds made available to the Agency for authorized activities may be advanced to and merged with this account: Provided further, That funds made available to county committees shall remain available until expended. 16 Appropriations Act, 2010 Budget Estimate, 2011 increase in Appropriation Item of Change Farm Loan Programs Income Support and Disaster Assistance Conservation Programs Commodity Operations Tota; Available 22-12 FARM SERVICE AGENCY SALARIES AND EXPENSES SUMMARY OF INCREASES AND DECREASES + $1,570,117,000 1,686,078,000 115,961,000 2010 Program 20; Estimated Pay Costs Changes Estimated $313,173,000 + $0 + 5,027,000 $318,200,000 884,696,000 + 12,357,000 + $95,323,000 992,376,000 3 10,874,000 + 2,477,000 + () 343,348,000 64,377,000 + 777,000 +- O 62,154,000 1,570, t?,000 + 15,6; 1,000 + 100,350,000 1,686.078,000 17 22-#3 FARM SERVICE AGENCY Project Slaterment (On basis of appropriation) 2009 Actual - 2010 Estirnated Increase 2011 Estimated Staff Staff or Staff Amount Years Amognt Years Decrease dºn Years Total S&E farm Loan Programs $309,403,000 2,923 $3ts, t?3,000 2,904 + $5,027,000 $318,200,000 2,904 income Support and Disaster Assistance 832,279,000 8,047 884,696,000 9,090 + 107,680,000 992,376,000 9,100 Conservation Programs - 294,807,000 2,835 310,371,000 1,922 + 2,477,000 313,348,000 1,922 Commodity Operations . $9,163,000 ! 17 6,377,000 103 + 777,000 62,154,000 ! 03 Totai Available or Estimate 1,496,654,000 t?,922 1,570, if 7,000 tº,019 +. 15,961,000 (i) f,686,078,000 #4,029 Unabhgated Balance - 68,488,000 * American Recovery and Reinvestment Act (ARRA}, 2009 P L 11 ?-5 -50,000,000 -- Transfer from the Office of Congressional Affairs., -302,000 ** Total, Appropriation !,314,839,999. 13,922 fo eittent {Oi! basis of available funds) increase or 2009 Actual 2010 Estimated Decrease 2011 Estimated Farm Loan Programs º $309,403,000 $3 13, iT3,000 + $5,027,000 $318,200,000 income Support and Disaster Assistance - 832,279,000 884,696,000 + 107,680,000 992,376,000 lncludes transfers from J PU 480 Program Account (2,736,000) (2,812,000) - (34,000) (2,846,000) CCC Export Guarantee Account (348,000) (355,000) (4,000) (359,000) Conservation Programs - 294,807,000 310,871.000 + 2,477,000 313,348,000 Commodity Operations . 60,165,000 61,377,000 + 777,000 $2,154,000 Total Available or Estumate $1,496,654,000 $4,570,117,000 + $1 iS,961,000 $1,686,078,000 Advances and Reimbursements (A&R) Loan Service Fees Transferred . a/. 4. 5,200,000 5,000,000 {} 5,000,000 Farm Bull * * * * * - 39,718,000 7,531,000 -7,531,000 {} All Other Advances and Reimbursements ** - * * * 92,483,000 87, t20,000 + -730,000 36,390,000 Subtotal, A&R - - H7,401,000 99.651,000 -8,261,000 91,390,000 Total Net Obligations. tº - - ". - t 1,634,655,000 1,669,768,000 + 107.700,000 1,777,468,000 Furids Carned Forward from Prior Year b/, ..cſ... 4 - - 30,836,000 () 0 {} American Recovery and Reinvestment Act (ARRA) d/ ..., -35,313,000 35,313,000 -35.3 i3,000 {} Funds Carried Forward to Next Year , c/ eſ f : . e - -33, 175,000 33, 175,000 -33,475,000 () Prior Year Refunds/Adjustments 1,264,000. 0 0. 0. Change in Funds Carned Forward -36,408,000 68,488,000 -68,488,000 0. Total, Available Funds Basts - $1,597,647,000 SH,738.256,000 + $39,212,000 $1.777,468,000 =#-ºº::======#|-ºº::=======<-ºfflº: a/ Loan service fees are paid by producers who obtain CCC commodity loans These ſees partially defray the administrative costs of processing the loans and are held in an account for the use by the FSA administrative expense account as needed b/ Section 702 of Title VII - General Provisions of the 2008 Appropriations Act, P.L. 110-161. provided that any funds made available to County Committees shall remain available until expended (7 U.S.C 2209B) cl FY 2001 Military Construction Appropriations (PL 106-246) an unobligated balance of $44 thousand is available d! The American Recovery and Reinvestment Act of 2009, PL tit-5, $50 million is available through Sept 30, 2040, of which $14.637 million was obtigated in FY 2009 and $35,313 million is remaining available in FY 2010 e/ Section 702 of Title VH - General Provisions of the 2009 Omnibus Appropriations Act, P L 111-8, provided that any funds made available to County Committees shall remain available until expended (7 USC 22098) An unobligated balance of $1 485 million is available - f! Section 738 of Title Vºl - General Provisions of the 2009 Omnibus Appropriations Act, P L 1-8, provided that any unobligated balances at the end of the fiscal year from appropriations made available for salaries and expenses shall remain available through September 30, 2010, for information technology expenses An unobligated balance of $21 646 million is available 5. It Č ſm FY 2010 Appropriations Act .. FY 2011 Budget Estimate Pay costs ........... .... . . . . . . . . . Operating Expenses. tº º ºx º E tº º increase for IT Modernization and Stabilization. ... Change from FY 2010 Appropriation ... ....... Total, FY 2011 Budget Estimate....... . ... .. FARM SERVICE AGENCY Salaries and Expenses by Source of Funding (Dollars in Thousands) Program Accounts Direct - CCC Appropriation ACIF P L 480 Export Credit Total $1,253,777 $313,173 s’s 2 $355 $1,570,117 15,573 0 - 34 4 15,611 - () 5,027 . 0 () 5,027 95,323 0 () () 95,323 # * * l 10,896 5,027 34 * 4 115,961 $1,364,673 53T300T $2,846 $359 $1,686,078 ; 19 (1) (2) 22-15 Justification of Increases and Decreases (1) An increase of $115,961,000 for Farm Service Agency Salaries and Expenses ($1,570,117,000 available in FY 2010) consisting of - - (a) A total increase of $103,998,000 for Federal Offices: An increase of $8,675,000 for the proposed pay costs and operating expenses for 4,880 direct Federal staff years. The FY 2011 proposed pay cost is for 4,880 direct Federal staff years. This includes $0.954 million for annualization of the FY 2010 pay raise and $2.694 million for the anticipated FY 2011 pay raise. The increase is necessary to fully support the staff required to administer farm programs such as direct and counter-cyclical payment contracts and increased conservation programs; to properly service existing farm loans efficiently and effectively and analyze new loan requests; and to maintain the personnel required to meet key objectives related to commodity operations. Of the total increase, $5.027 million is requested under the Agriculture Credit Insurance Fund for increased operating costs. An increase of $95,323,000 for IT stabilization and modernization of FSA computer systems. FSA plans, acquires, and manages funded IT resources for supporting and enabling business processes and program delivery systems. This includes automation and support functions for all FSA farm programs involving commodities, credit and loans, farm operations, conservation and disaster relief IT is a critical success factor for FSA in fulfilling its mission to (1) provide an equitable financial safety net for the Nation’s farmers and ranchers and (2) ensure that American agriculture remains competitive and productive in global markets while increasing the viability and stability of domestic agricultural operations. IT resources and services contribute to these achievements in several ways. By operating and maintaining an IT infrastructure at optimal performance and operating capacity, the doors are kept open and essential business operations are provided “face to face” by our employees to farmers and ranchers at 2,384 field Service Centers. IT is also there for FSA employees to process applications for farmers and ranchers in a timely manner, and it is IT that provides the means and mechanisms for eligible customers to get benefit payments promptly. FSA relies on one of the oldest information technology systems (hardware and software) within the Department of Agriculture that is inaccessible to the internet. Billions of dollars of annual farm program payments, conservation payments, and loans to producers mandated by the 2008 Farm Bill and other legislation are dependent upon the continued viability of this antiquated IT system. FSA must upgrade the aging technology infrastructure and equipment which is creating inefficiencies and threatening the delivery of fundamental services to producers. - Further, the outmoded IT systems of the Farm Service Agency are highly vulnerable to security breaches because inadequate data storage capacity requires sensitive producer data and financial information to be uploaded into mainframe computers from physical media, sent from county offices across the country rather than electronically. An independent review conducted pursuant to Section 1618 of the 2008 Farm Bill also concluded that “Modernization will bring significant benefits such as improvements in cost efficiency, producer access, fraud mitigation, staff efficiency and morale. More fundamentally, Modernization will replace the aging platforms that are difficult to maintain and incapable of supporting the fiduciary requirements that FSA faces today and will continue to face in the future.” 20 22-16 Without Sufficient funding to transform this FSA IT architecture into a modernized web-based environment, FSA would be compelled to continue operations by funding “stop gap.” responses to AS/400 hardware failures and limited options for part replacement and repair availability. This is a costlier alternative than getting FSA IT operations modernized on the scheduled timetable with the requested funding support, When all components of IT Modernization are completed and working together, FSA will have a streamlined IT architecture built on re-engineered and “mature” business processes that are supported by newer, faster, more secure and more reliable web-based technologies. FSA staff and stakeholders will have the quality information they need to deliver program benefits and information upon which FSA relies to meet their farm business challenges. Completion of this Modernization effort will produce a transformed FSA IT software developmental process that relies on streamlined and mature processes to meet planned strategic objectives and deliver quick response solutions. It will deliver and operate these open and portable applications within a 21” century architecture that operates on the web using shared information and leveraged resources. FSA IT operations will perform at optimal efficiency and capacity within desired response times in a secure IT environment. For FSA employees, Modernization will better equip them to educate, enroll and provide payments to FSA’s customers. Customers from anywhere that supports web technology will be able to access real-time information and perform real-time business transactions when and where they want them. With full modernization, FSA can create a reliable business environment for farmers and ranchers to make decisions to productively use farm payments, crop insurance, and disaster assistance to increase the viability and stability of their agricultural operations and provide economic vitality to rural America. The 2011 Budget proposes an increase of $95.3 million to fund critical IT replacement and modernization projects to support core FSA operations. Of this amount, $38.3 million is proposed for continued implementation of the MIDAS (“Modernize and Innovate the Delivery of Agricultural Systems”) initiative, which is a comprehensive project to streamline the existing complicated business processes that support mandated farm programs and provide a modern IT infrastructure to operate the programs. The 2011 proposal builds on funding included in the FY 2010 appropriation to continue this multi-year effort. Development of MIDAS is an extensive effort which will result in a secure, modern IT system capable of supporting web-based program delivery. The system will also provide linkages with the Department's new financial management system. A second component of the IT proposal is a $20 million increase needed for conversion of FSA software to shift program applications from the current obsolete system to the new IT system. Existing program software that is essential to delivery of FSA's core programs is written for the outmoded mainframe IT system and needs to be converted for use with modern, web-based systems. Funds will support this conversion of program delivery applications for use with the new system, Further, the budget proposes a $36 million increase in FSA to support the Department’s efforts to modernize and upgrade the Common Computing Environment (CCE) for the Service Center Agencies (SCAs). This funding will be used to replace outdated components of the IT infrastructure, many of which have exceeded their expected life cycles, in order to reduce system vulnerabilities to failure and improve the performance and effectiveness of the shared infrastructure. These improvements will allow the SCAs to better serve program participants with a more flexible and reliable IT infrastructure. This funding will allow for the first system-wide refresh of the CCE since the infrastructure was implemented in 2000. In addition, as the components of the CCE are replaced, USDA will implement a right-sizing 21 22-17 process whereby configuration changes will be made to better support the delivery of current and future programs. As part of this process, the Department will strive to improve system Security, reduce the long-term cost of infrastructure services, and improve service reliability. The proposed increase includes $1 million for additional IT staff (10 FTEs) and supports essential Modernization activities and initiatives to enhance implementation time and success rate. This includes MIDAS (COTS software customization) as well as non-COTS modernization such as Java-based enhancements to legacy systems, Staffing resources will be used for filling new technical skill gaps, managing contractors and work tasks, and providing contract oversight. As current staff attrition occurs, replacements will be focused on new skili areas that will help offset the “bubble effect”. Resource levels and service efficiencies will be monitored and evaluated to manage this situation. - 5) A total increase of $1 1,963,000 for non-Federal county offices includes: (1) An increase of $11,963,000 for the proposed pay costs for 9,149 direct non-Federal staff YèarS. The FY 2011 proposed pay cost is for 9,149 direct non-Federal staff years. This includes $3.139 million for annualization of the FY 2010 pay raise and $8.824 million for the anticipated FY 2011 pay raise. The increase is necessary to fully support the staff required to administer farm programs such as direct and counter-cyclical payment contracts increased conservation programs; and to properly service existing farm loans efficiently and effectively and analyze new loan requests. - - 22 22-13 FARM SERVICE AGENCY Saiartes and Expenses - Geographic Breakdown of Qblizations and Staff Years 2009 Actual and Estimated 2010 and 2011 FY 2009 FY 2010 FY 2011 Staff Staff . Staff State Arnotint Years Aſmouni Years Amount Years Alabama $19,436,200 50 $20,390,212| 58 $21,896,442 58 Alaska 827,962 3 $868,602 7 $932,753 7 Arizona 5,117,986 22 $5,369,201 22 $5,765,743 22 Arkansas 26,051.426 $97 $27,330, tº 6 $13 $29,348,625 ! # 3 California 17,284,252 63 $18,132,646 69 $ig,474,833 69 Canbbean 5,474,608 50 $5,425,455 57 $5,826. #52 57 Oolorado 15,036,774 4! $15,774,851 44 $16,939,903 44 Corunecticut 2,164,459 8 $2,267,542 8 $2,434,979 8 {}elaware t,862,408 9 $1.953,824 9 $2,098,124 9 District of Columbia 427,083,000; i,208 $448,046,294 1,270; $481,436,756 1,280 Florida 12,664,990 49 $43,283,502 43 $44,264,555 48 Georgia 27,774,296 58 $29,137,592 72 $31,289,549 72 Hawaii 3,035.360 $5 $3.334,350 $6 $3.419,530 }6 Idaho 14,051.569 $3 $14,743,288 57 $15,830,006 57 #linois 48,339,960 }{}4 $50,712,718 ! #3 $54,458,106 i i ; Indiana 33,173,017 §7 334,801.309 74 $37,371,560 74 Iowa $9,076,965 #44 $64,976,748 $47 $66,554,041 $47 Kansas 47,713,560 # 17 $50,055,572 | ?? $53,752,427 t 7 Kentucky 33,483,135 ! {3 $35,426,649 i 16 $37,720,928 | lº Louisiana 20,734,561 92 $21,752,343 94 $23,358,830 9 | Maine 6,268,478 32 $6,576, 16S 32 $7,06),848 32 Maryland 7,044,67; 19 $7,358,985 21 $7,902,483 2} łMassachusetts 3,595,730 H9 $3,772,226 20 $4,050,824 20 |Michigan 25,509, 182 73 $26.761,296 75 $28,737,752 75 |Minnesota . 42,712,557 i27 $44,809,095 130 $48,118,471 130 Mississippi 29,290,883 94 $30,728,441 to? $32,997,353 i07 Missouri 54,347,300 342 $57,044,928 246 $64,225,766 216 Montaris 22,285,064 63 $23,378,922 76 $25,405.572 76 Nebraska 41,004,646 | | 8 $43,017,352 120 $46,194,399 120 Nevada 2,477.3 10 12 $2,598,908 | | $2,790,850 | | New Hampshire 2,177,967 9 $2,284.872 10 £2,453,62t {{} New Jersey 4,107,392 17 $4,309,003 17 $4,627,244 17 New Mexico. 8,000,258 3 | $8,392,949 33 $9,012,810 33 ? Wew York 18,544, 34 77 $19,454,422 8 $20,894,228 3] ?North Carolina 31,487.958 33 $33,033,339 89 $35,473.23 89 North Dakołł 32,437,585 | 1 | $34,029,778 120; $36,543 037 $20 Ohio 30,929,838 65 $32,448,024 66 $34,844,473 66 Oklahoma 3i,440,485. #1 $32,983,736 $34 $35,419,750 |34 Qregor, 1,054,956 44 $1 #,597.587 44 $12,454.127 44 Pennsylvania 19,271,947 66 $20,247.907 73 $21,711,10] 73 Rhode island 885,752 5 $929,229 6 $997,857 6 South Carolina 14,994,871 50 $15,730,892 53 $46,892.697 $3 South Dakota 34,039.444 | |S $35,710,233 #23 $38,347,612 #23 Tennessee 27,666,708 78 $29,024,724 84 $31,568.345 84 Texas 76,212,640 2} 6 $79.953,524 227 $35,858,492 227 Utah 13.719,727 #04 $14,393,157 100 $15,456,164 100 Vermott 4,939,584 28 $5,482,043 22 $5,564,763 22 Virginis (9,172,438 52 $20,113,5}4 56 $21,598.998 56 Washington ł2,660,590 42 $43,282,033 45 $34,262,978 45 West Virginia 9,643.5 (8 4| $10,116,868 43 $10,864.049 43 Wisconsin 31,758,292 }00 $33,3}7.442 i{}! $35,777,780 {{}i Wyoming 6,924,827 27 $7,264,732 27 $7,801,268 27 Subtotal, Available or Estimate 1,496,654,000; 4,780; 1,570,417,000; 4,870; 1,686,078,000; 4,880 Unobligated balance 68,488,000 Total, Available or Estimate ł,565,142,000; 4,780} 1,570, 17.000; 4,870|_ 1,686,073,000; 4,880 Note Includes Recovery Act Funding º 23 CLASSIFICATION BY OBJECTS Salaries and Expenses 22- : 9 FARM SERVICE AGENCY 2009 Actual and Estimated 2010 and 2011 Personnel Compensation: Washington D.C. .......................................... Field ....…....….. ... …......... s g º s º is a s a s = * * * * * * * * * * 1 Total personnel compensation............. 12 Personnel benefits........................... ..... 13 Benefits for former personnel.............. Total pers, comp. & benefits........... Other Objects: 2} Travel....…..........................….... 22 Transportation of things....................... 23 Rent, communications, and utilities...... 23, 1 Rental Payments to GSA........................ 24 Printing and reproduction..................., 25 Other services........................... w s = w = • * * * * * 26 Supplies and materials......................... 31 Equipment........................... ~~~~ 41 Grants, subsidies, and contributions.... 42 lnsurance claims and indemnities........ 43 Interest and dividends.......................... 44 Refunds................................................ Total other objects..................... Total direct obligations ............................... Position Data: Average Salary, ES positions ...................... Average Salary, GS positions ..................... Average Grade, GS positions ...................... 200 20 1 0 20 i ! $122,726,000 $174,365,000 $177,998,000 232,788,000 202,667,000 202,639,000 355,514,000 - 377,032,000 380,637,000 98,129,000 104,020,000 105,063,000 530,000 0 0 454,173,000. 481,052,000 485,700,000 | 1,980,000 1 1,604,000 13,280,000 3,344,000 3,032,000 3,032,000 13,224,000 12,000,000 12,000,000 346,000 1,305,000 1,305,000 946,000 849,000 849,000 275,829,000 294,930,000 390,928,000 5,119,000 4,883,000 6,559,000 7,438,000 7,438,000 7,438,000 723,648,000 753,013,000 764,976,000 499,000 10,000 10,000 108,000 1,000 1,000 0. 0 0 1,042,481,000 1,089,065,000 1,200,378,000 1,496,654,000 . 1,570,117,000 1,686,078,000 $150,048 $154,775 $159,650 $71,980 $74,247 $76,586 12.2 12.2 12.2 24 Program/Project/Activity Farm Loan Programs * - income Support and Disaster Assistance Conservation Programs. Commodity Operations Total Appropriated 22-20 FARM SERVICE AGENCY Saiaries and Expenses U RY OF ERY ACT FUNDING 2009 2010 2011 $7,750,000 $0 $0 17,250,000 {} 0 17,250,000 0 O 7,750,000 {} 0. ... $50,000,000 $0. $0 -:- E- Project Statement - Reco Act (On basis of available funds) Farin Loan Programs Carryover Income Support & Disaster Assistance Carryover £onservation Programs Carryover Commodity Operations Caryover Unobligated Balance Total Available or Estimate 2009 Actual 2010 Estimated increase 2011 Estimated Staff Staff Qiſ - Staff Amount Years Olint Years Decrease Amount Years $2,349,925 0 $0 () $0 $0 0. 5,296,945 -5,296,945 0. {) 4,993.391 0. 0 {} - {} 0. 0. 12,359,539 0 -12,359,539 0. {} 4,993,591 () () {} {} {} 0 12.359,539 0. - 12,359,539 O 0 2,349,925 0 0. () (3 {} {} 5,296,945 0 -5,296,945 0. {} -35,312,968 {} 0. 0. Ø 0. {} $14,887,932 0. $35,312,968 0 -$35,3 12,968 $0 {} Program implementation Activities The Recovery Act Funds are a down payment on a multi-year modernization effort. FSA's continued investment in new technology is required to reliably administer program payments and provide basic farm program services to producers Of the $50 million, $31 million will be for IT stabliłłzation and $19 million for modernization Continue upgrading and improving the capacity, reliability and performance of our web-base program delivery applications Continue to sticamline the FSA business processes and develop an effective long-term IT system and architecture for farm program delivery Performance Measure Number of Jobs Created or Saved (ln private sector) Performance Data 2009 Actual 2010 T. 2011 Target 86 200 O 25 22g-l FARM SERVICE AGENCY SALARIES AND EXPENSES STATUS OF PROGRAM Current Activities: FSA’s major program areas are: • Farm Loans – FSA’s farm loan programs provide loans or guarantees to family farmers who could not otherwise obtain agricultural credit. The programs improve access to capital and mitigate market losses, including those resulting from disasters, and thus contribute to the success of farms and ranches, market-based agriculture sector, and thriving agricultural communities. • Income Support and Disaster Assistance — FSA’s income support and disaster assistance programs are key components of USDA’s efforts to provide America’s farmers and ranchers with an economic safety net to help them maintain their operations during difficult times. The programs mitigate market losses, including those resulting from disasters, and thus contribute to the success of farms and ranches, a market-based agriculture sector, and thriving agricultural communities. The programs also contribute to affordable food and fiber, a secure supply of quality food and fiber, and effective food aid. • Commodity Operations — FSA’s commodity operations include management of the U.S. Warehouse Act and acquisition, procurement, storage, and distribution of commodities. The programs expand market opportunities for farmers and thus contribute to the success of farms and ranches, a market-based sector, and thriving agricultural communities. These programs also contribute to affordable food and fiber, a secure supply of quality food and fiber, and effective food aid. • Conservation –FSA conservation programs help maintain and enhance the nation's natural resources and environment. Certain conservation programs mitigate losses from natural disasters and thus contribute to the success of farms and ranches, a market-based agricultural sector, and thriving agricultural communities. The programs target land to maximize conservation benefits and contribute to quality soil, water, wildlife habitat, and air. FSA programs, activities, and workload indicators in FY 2009 are outlined in the following pages. Farm Loans Farm Loan Programs. In FY 2009, activity under the Agricultural Credit Insurance Fund included: Number of direct loans tº tº $ ºn ~ 24,137 Dollar value of direct loans....................................... * c s g ....... $1,916,865,000 Number of guaranteed loans................ - - w 10,093 Dollar value of guaranteed loans...., * * * tº dº e & A flºº & ºm dº ſº. 4 ..................................... $2,657,494,000 State Mediation Grants (SMG). In FY 2009, SMG activity included: Number of State Mediation Grants. - & e e º 'º p - * * * * 34 Dollar value of grants....................... -- --------.... . . . . . . . . . . . . . . . . . ------------- • *x * $4,369,000 Amount of SMG payments issued................... - $4,484,432 26 22g-2 Income Support and Disaster Assistance Direct and Counter-cyclical Program (DCP) and Average Crop Revenue Election (ACRE). FY 2009 activity consisted of participant annual enrollment, contract maintenance, and payment processing. Total number of DCP contracts ......................................... ‘. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,573,920 Dollar value of direct payments made...................................................................................... $5,222,325,000 Dollar value of counter-cyclical payments made................................................•e a -s a s ºr r s = e w w w s. * * * * * * * * $731,087,000 Total number of ACRE contracts................................................................................. 130,551 Dollar value of ACRE payments made................................................................................. $0 Deficiency Payments. Marketing assistance loans, loan deficiency payments, and other price support program activities in FY 2009 included: - Marketing Assistance Loans Loan Deficiency Payments (LDP's) Commodity Number of Dollar Value Number of Dollar Value º Loans ($000) LDP’s ($000). Corn 30,656 2,052,035 i4 $25 Grain Sorghum 585 16, 129 0 30 Barley 456 12,616 1,926 1,659 Oats ! 83 . 1,527 0 0. Wheat 5,846 236,243 932 4,031 Rice 4,037 444,733 0 69 Cotton aſ 13,975 2,718,184 33,865 131,166 Soybeans 20,845 941,978 4 39 Minor Oilseeds 435 20,322 () {} | Sugar b/d/ S49 1,118,369 0 {} Peanuts 11,097 718,163 0 0 Tobacco b/ C/ 0 0 0 0 Honey d/ 273 6,846 0 0 Pulse Crops 115 3,643 () -9 Wool & Mohair 5 12 | 39,863 8,487 Total 89,057 8,290,909 76,604 $145,497 aſ Reflects loans made through the county offices. In addition, loans are made through cooperative associations; the number of those loans is not available. b/ LDP's are not available for tobacco or sugar. c/ The number of tobacco loans is not available. d/ There was no LDP activity for sugar and honey. 27 22g-3 'arm Storage Facility Loans (FSFL). FSFL program activities in 2009 included: 'arm Storage Facility Loans closed......................................................................................................... 2,464 Amount of Farm-Storage Facility Loans................... * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * g e $139,249,000 The objectives of the Corporation in carrying out its storage program are to help producers finance leeded storage facilities on their own farms and to make efficient use of commercial facilities in the torage of CCC-owned commodities. - ilk Income Loss Contract (MILC) Program. The MILC was authorized by the 2002 Act and has no set nding level. The 2008 Farm Bill extends the MILC program through 9/30/2012. This program purpose s to financially compensate dairy producers when domestic milk prices fall below a specified level. Y 2009 activity included: - . umber of MILC payments............ tº w n w tº s ºf s tº e º a • * r * * * * * * * * * * * * * * * * e s s m = w w w w s is s p * * * * * * * * w w w w e º ºr e º w w y z º. ºp s - - - - - - - 310,830 mount of MILC payments ..... w w p * * * * g º ºs e º 'º w tº e s e = * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * tº ºr ºr a 0 < * * 4 s~ $756,889,000 on-Insured Crop Disaster Assistance Program (NAP). NAP activity in FY 2009 included: umber of actual production history records completed for NAP........... ~~~~ 40,200 umber of NAP applications for coverage................... * * … 64,000 mount of NAP payments issued.... ---......................"------------------------------------------ $62,064,000 ivestock Compensation Program (LCP) LCP activity in FY 2009: umber of LCP contracts................... ~~~~ 128 mount of LCP payments - CCC............ - 4 ºr ; a tº tº º 'º tº º, º is a tº e º q & 4 & $ & $32,476 mount of LCP payments - USDA Disaster Assistance......... . . . . . . . . . . . . . . . . . . . . . . $2,042,744 Livestock Indemnity Program (LIP). LIP activity in FY 2009: Number of LIP applications and disapproved applications • * * * is a s tº 4 sº e s tº tº $ tº a v * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * 26 Amount of LIP payments- USDA Disaster Assistance * * * * * * tº w e º 4 + æ e º 'º º e º is 4 & & 4 W 6 tº tº tº w tº Q & M tº ſº e º ºs º º tº $1,692,629 Amount of LIP payments - Agriculture Disaster Assistance.............................................. $2,946,799 Crop Disaster Program (CDP). CDP activity in FY 2009 included: Number of CDP applications........................................................................................................---------. 1 1,696 Amount of CDP payments issued - CCC w w e = wr * $113,777 Amount of CDP payments issued - USDA Disaster Assistance................................................. $114,562,916 Tree Assistance Program (TAP), Activity for FY 2009 included: Number of TAP applications............ - a ~~~~ 7 Amount of TAP payments - CCC................................. - $67,583 Commodity Operations Commercial Warehouse Activities. During FY 2009, 960 U.S. Warehouse Act licenses were in effect at 3,057 locations. 77 staff years, which includes Federal examiners, were used in the performance and review of onsite examinations at 1,056 grain, 302 cotton, and 70 miscellaneous commodity warehouses. In addition, CCC contract onsite examinations were performed at 398 grain, 282 cotton, 78 miscellaneous, and 143 processed commodity warehouses. 28 22g-4 In accordance with the Grain Standards and Warehouse Improvement Act of 2000, user fees are charged forwarehouse examination services of all warehouses licensed under the United States Warehouse Act (USWA). Grain, rice, and cotton warehouses not licensed under the USWA pay contract fees to CCC. However, the collection of an annual contract fee is currently suspended. End-Use Certificate Program. FSA monitors Canadian wheat imports through the use of North American Free Trade Agreement mandated end-use certificates. Almost 1.897 million metric tons (69.7 million bushels) of Canadian wheat entered the U.S. in FY 2009. Economic Adjustment Assistance Program for Domestic Users of Upland Cotton. The 2008 Farm Bill authorized USDA to provide economic adjustment assistance to domestic users of upland cotton in the form of payments. In FY 2009, $67.3 million was paid to domestic users of upland cotton to support U.S. manufacturing infrastructure. Extra-Long Staple Cotton Competitiveness Program. In FY 2009, CCC provided payments of $0.534 million to domestic users and $9.78 million to exporters. Domestic Nutrition and Feeding Programs. In FY 2009, over 268 million pounds of nonfat dry milk (NDM) and 4.7 million pounds of butter were purchased by FSA under the Dairy Product Price Support Program. Of this quantity, 92.8 million pounds of NDM were utilized to provide food for domestic feeding programs. Additionally, 609.2 million pounds of peanut products, dairy products, flour, pasta, vegetable oil, and corn and rice products were also purchased by FSA for domestic feeding programs. Foreign Food-Aid Humanitarian and Developmental Assistance Programs. In FY 2009, FSA procured more than 2.8 million metric tons of grains, processed grain products, vegetable oil, pulses (such as dried. beans, peas, lentils), and other products valued at approximately $1.0 billion for food relief programs throughout the world. Commercial Storage. The Corporation has contracts to store Government-owned and collateralized agricultural products in over 6,735 warehouses located throughout the United States. The inventory of CCC-owned commodities was reduced during FY 2009, resulting in $5.73 million in storage and handling charges. Total number of loans was 88,313. - In accordance with the Grain Standards and Warehouse Improvement Act of 2000, user fees are charged for warehouse examination services of all warehouses licensed under the United States Warehouse Act (USWA). Grain, rice, and cotton warehouses not licensed under the United States Warehouse Act pay contract fees to CCC. However, the collection of an annual contract fee is currently suspended. Conservation Emergency Conservation Program (ECP). FY 2009 activity included: Number of ECP payment applications......................... • * * * * * g º ºs e e g º e º a e < * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * 63,097 Amount of ECP payments issued............. * a 4 & 4 a a is a sº a 4 & a 2 & 4 & 2 a e s e º 4 a. s. v c 4 º' e º 'ºt a 4 ~ * * * * * $71,083,900 Hazardous Waste Management Program: Hazardous Waste Management Program: Carbon tetrachloride, formerly used as a pesticide to treat stored grain, has been detected above the Environmental Protection Agency Maximum Contaminant Level in groundwater samples taken at over 80 former CCC grain storage facilities. Current environmental liability posed by these sites is estimated to exceed $50 million. Since FY 2003, Hazardous Waste Management funding from the Department has been greatly reduced and CCC has continued to rely on its Section 11 borrowing authority. CCC is authorized to use its borrowing authority, not to exceed $5 million, for site investigations, ongoing operations and maintenance, and remediation expenses, 29 22g-5 though the funding has declined annually in real dollars, numerous fiscal commitments have continued to crease. These include the costs of environmental monitoring and sampling needed to comply with ulatory mandates. Other additional costs are anticipated to comply with regulatory determinations to tall remedial systems at former CCC sites. For these reasons the Hazardous Waste Program has begun orts to reestablish CCC access to the U.S. Department of Justice Judgment Fund. Conservation Reserve Program (EFCRP). 2009 activity included: mber of active CRP contracts............. * * * $ tº a tº 4. ....... .760, 152 mber of CRP cost-share payments. ... 4 tº a 4 & 0 tº e < * * * * * * tº gº º ºn e º 'º º º s is © tº s v ºr 4 - 0 tº º t e º 'º ºf 4 & a tº * * * * * * * * * * * .65,980 ount of CRP cost-share and incentive payments m e º nº ſº tº e º 'º w w w w tº tº a y º gº & v & ſº tº ti º e º sº e º ſº tº w w w is tº * * * * * * * * * * * * * * * * * * * $78,386,41 mber of CRP rental payments.............. 954,053 ount of CRP annual rental payments.... * - - - tº * * * a s a $1,734,977,412 mber of CRP acres approved for enrollment...., * ..... 1,307,056 mber of EFCRP cost share payments......................................................................... ,..., .914 ount of EFCRP cost-share payments * c q & © ºn Q tº tº e º ºr e º ºs e º 'º - - - - - w tº e º e º 'º e º 'º - - - - - - - - tº tº a tº 4 s tº * * * * * * * * * * * * * * * * * * * * $3,950,444 mount of EFCRP technical assistance payments gº º ..... $19,938 umber of EFCRP rental payments................................................................................ 1,396 mount of EFCRP annual rental payments................................................................. $6,061,136 rasslands Reserve Program (GRP). FY 2009 activity included: umber of GRP applications and contracts submitted.” * * * ...... 1,007 mber of GRP active contracts * * * * * * * * : A & tº ſº e º a m ºr q = ~ * * * * * * * * * * * 3,379 30 22–21 FARM SERVICE AGENCY The estimates include appropriation language for this item as follows: State Mediation Grants For grants pursuant to section 502(b) of the Agricultural Credit Act of 1987, as amende (7 U.S.C. 5101-5.106), $4,369,000. 31 22-22 STATE MEDLATION GRANTS Appropriations Act 2010.… * * * * * * * * * * * * * * * * * * * * - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - , , , , $4,369,000 Budget Estimate, 2011 ...….......................................................................................... 4,369,000 Change in Appropriations * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * a s a 4 - A * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * ** SUMMARY OF INCREASES AND DECREASEs (On basis of appropriation) | 2010 Program 201 | Item of Change Estimated Changes Estimated State Mediation Grants...................................... * $4,369,000 *: $4,369,000 PROJECT STATEMENT (On basis of appropriation) 2009 2010 Increase or 20 ! } Project Actual Estimated Decrease Estimated State Mediation Grants............................. $4,369,000 $4,369,000 -- $4,369,000 Totai Appropriation.................................. 4,369,000 4,369,000 __ $4,369,000 Justification of Requested Level In FY 2009, 34 States received grants pro rated at 71 percent of their initial request. States budgeted over $2.1 million in matching funds for the program. In FY 2010, 35 to 36 States are expected to receive grants. In FY 2009, grants to States ranged from $14,303 to $372,922, and in fiscal years 2010 and 2011 grants are expected to range from about $5,000 to $322,398. The program is currently authorized through September 30, 2010, under P. L. 109-17, enacted June 29, 2005. The following table shows the geographic breakdown of obligations for fiscal years 2009–2011. RR_ſ\927 TY_O 32 22-23 State Mediation Program Geographic Breakdown of Obligations 2009 Actual and Estimated 2010 and 2011 T20IT 2009 2010 State Actual Estimated Estimated Alabama $197,628 $183,094 $183,094 Arizona 109,664 104,458 104,458 Arkansas 69,130 65,584 65,584 California 57,284 44,798 44,798 Colorado 12,610 33,056 33,056 Florida 40,788 38,035 38,035 Illinois 89,985 85,781 85,781 Indiana 140,853 132,074 132,074 Iowa 186,902 208,061 208,061 Kansas 372,922 322,398 322,398 Louisiana 95.353 102,990 102,990 Maine 58,401 46,034 46,034 Maryland 104,834 103,681 103,681 Massachusetts 147,650 147,483 147,483 Michigan 83,123 78,858 78,858 Minnesota 326,159 306,095 306,095 Mississippi 117,656 73,323 73,323 Missouri 67,574 64,281 64,281 Nebraska 131,450 113,271 i 13,271 New Jersey 14,303 16,283 16,283 New Mexico 53,074 52,380 52,380 New York 289,515 302,096 302,096 North Carolina 157,870 127,584 127,584 North Dakota 233,135 216,484 216,484 Oklahoma 270,896 181,676 181,676 Pennsylvania () 65,584 65,584 Rhode Island 43,386 26,905 26,905 South Dakota 90,682 106,031 106,031 Texas 197,857 255,656 255,656 Utah 19,685 16,154 16,154 Vermont 163,530 155,141 155,141 Virginia 54,526 42,024 42,024 Washington 70,973 54,051 54,05 I Wisconsin 218,157 203,725 203,725 Wyoming 81,445 75,422 75,422 Undistributed 0. 218,449 218,449 Totai, Available or Estimate 4,369,000 4,369,000 4,369,000 33 22-24 FARM SERVICE AGENCY State Mediation Grants Classification by Objects 2009 Actual and Estimated 2010 and 20 ! : Object Class 2009 2010 20 + 1 4}.0 Grants, subsidies, and contributions $4,369,000 $4,369,000 $4,369,000 Total direct obligations 4,369,000 4,369,000 4,369,000 34 22g-6 STATE MEDIATION GRANTS STATUS OF PROGRAM Current Activities: During FY 2009: • Grants were made to 34 States. One additional State is expected to become certified in FY 2010. • States contributed over $2.1 million in matching funds. • Participating USDA agencies include FSA, Forest Service, Natural Resources Conservation Service, Risk Management Agency, and Rural Development. - • In addition to credit disputes, the most frequently mediated issues were Conservation Reserve Program payment eligibility/limitation, highly erodible land/water conservation program requirements, price support payments, and production flexibility contracts. • Program Results Comparison: FY 2008 FY 2009 Number of cases mediated 2,577 5,428 Number of cases resolved 1,728 1,855 Percentage of cases resolved” 80% 64% Average cost per case $986 $800 *Target was 75 percent for both fiscal years. Selected Example of Recent Progress In order to protect the confidentiality of the mediation process, details are not provided that would allow identification of the parties. Mediation Improves Communication and Enables Farmer to Recoup Crop Loss: A farmer received a lette from FSA informing him that his request for Noninsured Crop Disaster Assistance Program (NAP assistance had been denied. The farmer believed that his NAP claim should have been approved, however and he requested to meet with FSA through the Agricultural Mediation Program. The mediation process proved beneficial for both the client and FSA in a few ways. As a result of the mediation session, FSA agreed to reevaluate a portion of the claim, meaning that the farmer could recoup some of his crop loss and thus remain on better financial ground. In addition, the mediation was successful because the mediator was able to facilitate a discussion between the farmer and FSA regarding the circumstances which had led to the original denial. By talking things through, the parties were able to better understand each other's assumptions, address and correct some past miscommunications, and agree on a procedure to follow regarding similar situations in the future. In this way, they proactively worked together to avoid having the same type of issues recur. - The following table shows allocations and outlays by State for FY 2009. 35 22g-7 State Mediation Grants Grants and Outlays by State Fiscal Year 2009 State Grants Outlays aſ Alabama $197,628 $208,222 Arizona 109,664 205,009 Arkansas 69,130 69,858 California 57,284 28,436 Colorado 12,610 18,729 Florida 40,788 56,086 Illinois 89,985 43,803 Indiana 140,853 95,353 Iowa 186,902 313,414 Kansas 372,922 413,758 Louisiana 95,353 I 19,490 Maine 58,401 62,096 Maryland 104,834 50,334 Massachusetts 147,650 137,859 Michigan 83,123 1 19,699 Minnesota 326, 159 208, i 18 Mississippi 117,656 90,971 Missouri 67,574 54,099 Nebraska 131,450 149,400 New Jersey 14,303 18,234 New Mexico 53,074 58,382 New York 289,515 289,515 North Carolina 157,870 133,892 North Dakota 233, 135 196,369 Oklahoma 270,896 305,049 Rhode Island 43,386 54,525 South Dakota 90,682 36,053 Texas 197,857 236,103 Utah 19,685 15, 198 Vermont 163,530 198,530 Virginia 54,526 69,857 Washington 70,973 56,973 Wisconsin 218, 157 266,783 Wyoming 81,445 104,235 Total $4,369,000 $4,484,432 aſ includes outlays from prior year obligations. 36 22-25 FARM SERVICE AGENCY The estimates include appropriation language for this item as follows (deleted matter enclosed in brackets): Grassroots Source Water Protection Program [For necessary expenses to carry out wellhead or groundwater protection activities under section 1240O of the Food Security Act of 1985 (16 U.S.C. 3839bb–2), $5,000,000, to remain available until expended.] The FY 2011 Budget proposes no funding for this program. 37 22–26 GRASSROOTS SOURCE WATER PROTECTION PROGRAM Appropriations Act, 2010.......................... • * * * * * * * * * * * * * * * * * * * * * * * * > . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $5,000,000 Budget Estimate, 2011 ….....…................................................................. 0 Decrease in Appropriation................................................................................................... --5,000,000 SUMMARY OF INCREASES AND DECREASES (On basis of appropriation) 2010 Program 2011 Item of Change Estimated Changes Estimated Payments to State Rural Water - Associations................... ........................................ $5,000,000 -$5,000,000 —9 PROJECT STATEMENT (On basis of appropriation) 2009 2010 201 || Project Actual Estimated Decrease Estimated Payments to State Rural Water Associations........................................... $4,950,000 $4,950,000 -$4,950,000 Payment to the FSA S&E Account........ 50,000 50,000 -50,000 Total appropriation................................. 5,000,000 5,000,000 –5,000,000 (1) Justification of Decrease (1) A decrease of $5,000,000 for Grassroots Source Water Protection Program (GSWPP) ($5,000,000 available in 2010): Classification by Objects The FY 201 I Budget proposes no funding for this program due to fiscal constraints. 2009 Actual and Estimated 2009 and 2010 Object Class 250 Payment to the FSA S&E Account 41.0 Grants, subsidies, and contributions Total direct obligations 2009 2010 20 | 1 $50,000 $50,000 0 4,950,000 4,950,000 O 5,000,000 5,000,000 0 38 22g-8 - GRASSROOTS SOURCE WATER PROTECTION PROGRAM STATUS OF PROGRAM Current Activities: The Grassroots Source Water Protection Program (GSWPP) is a joint project by the Farm Service Agency and the nonprofit National Rural Water Association (NRWA) designed to help prevent source water pollution in States through voluntary practices installed by producers at the local level, GSWPP uses onsite technical assistance capabilities of each State rural water association that operates a wellhead or groundwater protection program in the State. State rural water associations can deliver assistance in developing source water protection plans within priority watersheds for the common goal of preventing the contamination of drinking water supplies. - Selected Examples of Recent Activity: During FY 2009, $5 million was provided by P.L. 1 1 1-8, the Omnibus Appropriations Act, 2009. The 44 States (an increase of 7 States from FY 2008) participating ir the GSWPP were chosen based on objective technical criteria relating to water quality and population. During FY 2009, $4,950,000 was outlayed, including $255,054 for administrative costs to operate the program under the NRWA. States received various amounts ranging from $66,790 to $105,210. In addition, $50,000 was transferred to the FSA Salaries and Expense account for administrative expenses associated with the implementation of the program. Between October 1, 2008 and September 30, 2009, the GSWPP completed 112 source water plans with management activities implemented in the source water areas. The 112 plans provide protection measures for 543 public drinking water sources-487 wells and 56 surface water intakes. The program was implemented in the following States: Alabama Georgia. Maryland North Carolina Texas Alaska Idaho Massachusetts North Dakota Utah Arizona Illinois Michigan Ohio Vermont Arkansas Indiana Minnesota Oklahoma Virginia California Iowa Mississippi Oregon Washington Colorado Indiana Missouri Pennsylvania West Virginia Connecticut Kansas Montana Rhode Island Wisconsin Delaware Louisiana Nevada South Carolina Wyoming Florida Maine New Mexico South Dakota The following table shows appropriations from fiscal years 2005 through 2009. Grassroots Source Water Protection Program Appropriations for Fiscal Years 2005-2009 Fiscal Year Appropriations 2005 3,244,000 iſ 2006 3,712,500 : 2007 3,712,500 2008 3,687,009 2009 5,000,000 TOTAL $19,356,009 1/ Funds transferred from the Natural Resources Conservation Service to the Farm Service Agency to assist in the implementation of the program, 39 22–27 FARM SERVICE AGENCY The estimates include appropriation language for this item as follows: Dairy Indemnity Program (Including Transfer of Funds): For necessary expenses involved in making indemnity payments to dairy farmers and manufacturers of dairy products under a dairy indemnity program, such sums as may be necessary, to remain available until expended: Provided, That such program is carried out by the Secretary in the same manner as the dairy indemnity program described in the Agriculture, Rural Development, Food and Drug Administration, and Related Agencies Appropriations Act, 2001 (Public Law 106-387, | 14 Stat. 1549A-12). 40 22-28 DAIRY INDEMNITY PROGRAM Appropriations Act, 2010................................................... “...------. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .----. $876,000 Budget Estimate, 2011 .................... ............. & & a • * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * s s a t w w w = e s = e a s • * * * * * * * * * * * * 876,000 Change in Appropriation.….….................................................................. * * | -- SUMMARY OF INCREASES AND DECREASES (On basis of appropriation) 2010 Program 2011 Item of Change Estimated Changes Estimated Indemnity payments to dairy farmers and manufacturers $16,000 + = $876,000 PROJECT STATEMENT (On basis of appropriation) 2009 2010 Increase or 20 ! I Project Actual Estimated Decrease Estimated Indemnity payments to dairy farmers - - and manufacturers............................. $876,000 $876,000 - º $876,000 Total appropriation.............................. 876,000 876,000 -º-º: 876,000 PROJECT STATEMENT (On basis of available funds) 2009 20 || 0 Increase or 201 | Project Actual Estimated Decrease Estimated Indemnity payments to dairy farmers and manufacturers............................. $650,788 $1,208,600 -$332,600 $876,000 Unobligated balance brought forward from prior years................................. -107,388 -332,600 +332,600 & wº Unobligated balance carried forward to next year............................. ~~~~ 332,600 ºpº - * ** Total appropriation.............................. 876,000 876,000 - sº 876,000 Justification The amount of Dairy Indemnity Program (DIP) claims varies considerably from year to year, depending upon the nature and extent of contamination problems encountered. It is therefore impossible to predict with any degree of accuracy what program needs will be in a given year. For tha reason, the budget requests “such sums as may be necessary,” the same as Congress provided for FY 2010. The FY 2011 level of $876,000 is an estimate of the amount to be used under the indefinite authority. 41 22–29 The following tables show the geographic breakdown of obligations and the classification by objects for fiscal years 2009-2011. Dairy Indemnity Program Geographic Breakdown of Obligations 2009 Actual and Estimated 2010 and 2011 State 2009 Actual 2010 Estimated 20 l l Estimated Alabama $5,911 tº wº tº try Arkansas 6,729 $2,336 - --> Georgia 44,716 * * - - ºr Kansas 186,787 sº ºn - tº Missouri 16,208 1,093 - sº |Nevada 77,958 * - ** New Mexico. 63,259 -- --> Oklahoma 49,007 --> -> * Texas - 200,805 4,071 wº Undistributed -592 1,201,101 $876,000 TOTAL $650,788 $1,208,601 $876,000 Classification by Objects 2009 Actual and Estimated 2010 and 2011 Object Class 2009 201 20 ! I 410 Grants, subsidies, and contributions $650,788 $1,208,601 $876,000 Total direct obligations 650,788 1,208,601 876,000 42 22g-9 DAIRY INDEMNITY PROGRAM STATUS OF PROGRAM Current Activities: During FY 2009, 22 dairy farmers in 9 States filed claims totaling $659,212 under the Dairy indemnity Program. Nineteen claims resulted from losses due to aflatoxin, a contaminant, and three claims resulted from losses due to Polonium 210, a rare and highly radioactive metalioid, discovered in their cattle's milk. Outlays for FY 2009 totaled $650,788. The unobligated balance of $332,600 will be obligated and outlayed during FY 2010. Payments to dairy farmers since the program's inception in FY 1965 total $20.592 million. The provision for making indemnity payments to manufacturers of dairy products became effective on November 30, 1970. Since that time, 20 manufacturers have received indemnity payments totaling $3.9 million, which is unchanged since FY 1987. Selected Examples of Recent Activity: The following tables show (a) allocations and outlays by State during FY 2009 and (b) payments and number of payees during fiscal years 1965 through 2009. Dairy Indemnity Program Allocations and Outlays by State Fiscal Year 2009 State Allocations Outlays Alabama $5,911 $5,911 Arkansas 6,729 6,729 Georgia 44,716 44,716 Kansas 186,787 186,787 Missouri 21,167 16,208 Nevada 77,958 77,958 New Mexico 66,132 63,259 Oklahoma 49,007 49,007 Texas 200,805 200,805 Undistributed &gº -592 TOTAL $659,212 $650,788 43 22g-10 Dairy Indemnity Program Payments and Number of Payees Fiscal Years 1965-2009 Payments to Payments to Fiscal Dairy Manufacturers of Total Number of Years Farmers Dairy Products Payments _Payees 1965 to 1974 $1,648,663 141,427 1,790,090 449 1975 193,389 -- 193,389 26 1976 aſ 159,289 * * 159,289 - 19 1977 40,284 * * 40,284 8 1978 66,266 9,210 75,476 #2 1979 64,267 * * 64,267 13 1980 91,575 * - 91,575 9 1981 42,231 --> 42,231 15 1982 15,087 vs wº 15,087 5 1983 6,121,374 --> 6,121,374 18 1984 2,043,010 398,910 2,441,920 22 1985 50,070 * - 50,070 5 1986 15 -- 15 {{} 1987 4,871,724 3,361,892 8,233,616 b/ 131 1988 449,543 ** 449,543 4 1989 230,101 tºº 230,101 106 1990 112,405 gºº 112,405 52 1991 90,702 * - 90,702 24 1992 131,651 tº ºn 131,651 51 1993 120, #29 -- 120,129 27 1994 387,358 ºw 387,358 27 1995 18,565 wº- 18,565 7 1996 207,867 eºrº 207,867 22 1997 257,311 gºº 257,311 30 1998 416,622 4- ºr 416,622 42 1999 126,353 * *- 126,353 30 2000 36,407 as wº 36,407 7 2001 22, ; 12 º - 22,112 9 2002 124,309 * ºn 124,309 19 2003 393,369 **- 393,369 69 2004 601,092 º º 601,092 86 2005 349,232 ** 349,232 23 2006 132,457 tetº 132,457 15 2007 181,329 tº ºw 181,329 2} 2008 144,388 tº ºw 144,388 14 2009 651,380 * - 650,788 22 Total $20,591,926 $3,911,439 $24,502,773 1,449 ! includes transition quarter, b/ Includes payments totaling $2,264,172 that were issued to producers and manufacturers in fiscal year 1986 but not reported to the National office and Treasury in time to appear as outlays in fiscal year 1986. 44 22-30 FARM SERVICE AGENCY The estimates include appropriation language for this item as follows (new language underscored, deleted matter enclosed in brackets): - Agricultural Credit Insurance Fund Program Account (Including Transfers of Funds): For gross obligations for the principal amount of direct and guaranteed farm ownership (7 U.S.C. 1922 et seq.) and operating (7 U.S.C. 1941 et seq.) loans, Indian tribe land acquisition loans (25 U.S.C. 488), boll weevil loans (7 U.S.C. 1989), direct and guaranteed conservation loans (7 U.S.C. 1924 et seq.), and Indian highly fractionated land loans (25 U.S.C. 488), to be available from funds in the Agricultural Credit Insurance Fund, as follows: farm ownership loans, [$2,150,000,000] . $1,975,000,000, of which $1,500,000,000 shall be for unsubsidized guaranteed loans and [$650,000,000] $475,000,000 shall be for direct loans; operating loans, [$2,670,000,000] $2,544,035,000, of which $1,500,000,000 shall be for unsubsidized guaranteed loans, [$170,000,000] $144,035,000 shall be for subsidized guaranteed loans and [$1,000,000,000] $900,000,000 shall be for direct loans; Indian tribe land acquisition loans, {3,3,940,000] $2,000,000; conservation loans, $150,000,000, of which $75,000,000 shall be for guaranteed loans and $75,000,000 shall be for direct loans; Indian highly fractionated land loans, $10,000,000; and for boll weevil eradication program loans, [$100,000,000] $60,000,000; Provided, That the Secretary shall deem the pink bollworm to be a boll weevil for the purpose of boil weevil eradication program loans. For the cost of direct and guaranteed loans, including the cost of modifying loans as defined in section 502 of the Congressional Budget Act of 1974, as follows: farm ownership loans, [$32,070,000] $38,570,000, of which [$5,550,000; $5,700,000 shall be for unsubsidized guaranteed loans, and [$26,520,000] $32,870,000 shall be for direct loans; operating loans, [$106,402,000) $109,410,000, of which [$35,100,000]{34,950,000 shall be for unsubsidized guaranteed loans, [$23,902,000] $19,920,000 shall be for subsidized guaranteed loans, and [$47,400,000] $54,540,000 shall be for direct loans; conservation loans, [$1,343,000] $2,528,000, of which [$278,000] $285,000 shall be for guaranteed loans, and [$1,065,000] $2,243,000 shall be for direct loans; and Indian highly fractionated land loans, [$793,000] $214,000. In addition, for administrative expenses necessary to carry out the direct and guaranteed loan programs, [$321,093,000] $326,120,000, of which [$313,173,000] $318,200,000 shall be 1 [transferred] paid to [and merged with] the appropriation for “Farm Service Agency, Salaries and Expenses”. - Funds appropriated by this Act to the Agricultural Credit Insurance Program Account for farm ownership, operating and conservation direct loans and guaranteed loans may be transferred among these programs: Provided, That the Committees on Appropriations of both Houses of Congress are notified at least 15 days in advance of any transfer. This change clarifies the appropriation language for the reimbursement of the FSA Salaries and Expenses account for work to administer farm loans. 45 22-31 FARM SERVICE AGENCY AGRICULTURAL CREDIT INSURANCE FUND - Administrative Total Budget Loan Level Subsidy Expenses Authority Appropriations Act, 2010........................... $5,083,940,000 $140,608,000 $321,093,000 $461,701,000 Budget Estimate, 2011.............................. 4,741,035,000 150,722,000 326,120,000 476,842,000 Change in Appropriation........................... -342,905,000 +10,114,000 +5,027,000 +45,144,000 Summary of Increases and Decreases (On basis of adjusted appropriation) 20 ! {} Program 201 | Item of Change Estimated Changes Estimated Loan Levels: Farm Ownership....... .... .......................... ................. 650,000,000 - 175,000,000 475,000,000 Farm Operating..................... .................................... 1,000,000,000 -100,000,000 900,000,000 Indian Land........................ ................... ................. 3,940,000 - 1,940,000 2,000,000 Boij Weevil....... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 100,000,000 -40,000,000 60,000,000 Total Direct Loans....................................................... 1,753,940,000 -316,940,000 1,437,000,000 Farm Ownership - Unsubsidized..................................... 1,500,000,000 0 1,500,000,000 Farm Operating - Unsubsidized....................................... 1,500,000,000 0 1,500,000,000 Farm Operating - Subsidized......................................... ... 170,000,000 -25,965,000 144,035,000 Total Guaranteed Loans............................................... 3,170,000,000 -25,965,000 3,144,035,000 Conservation Direct..................................................................... 75,000,000 0 75,000,000 Guaranteed.... .......................................................… 75,000,000 () 75,000,000 Total Conservation Loans............................................. 150,000,000 0 150,000,000 Indian Highly Fractionated Land Loans.......................... 10,000,000 0. 10,000,000 Total Loans................................................................ 5,083,940,000 -342,905,000 4,741,035,000 Budget Authority: Direct Loan Subsidy.. ................................................... 73,920,000 +}3,490,000 87,410,000 Guaranteed Loan Subsidy............................. ................ 64,552,000 -3,982,000 60,570,000 Conservation Loan Subsidy........................................... 1,343,000 +1, 185,000 2,528,000 Indian Highly Fractionated Land Subsidy........ .................. 793,000 -579,000 214,000 Total Subsidy......................................................... i40,608,000 +10,114,000 150,722,000 Administrative Expenses.…. , 321,093,000 +5,027,000 326,120,000 Total Budget Authority.................................. • * * * * * * * * * * * * * 461,701,000 15,141,000 476,842,000 § Program: Durect loans Farm Ownership Farm Operating - Farm Operating- ARRA Indian Land Acquisition Boll Weevil Eradication Total Direct Loans and Subsidies Guaranteed Loans Farm Ownership, Unsubsidized Farm Operating, Unsubsidized Farm Operating. Subsidized Total Guaranteed Loans and Subsidies Conservation Loans Direct Guaranteed Total Conservation Loans and Subsidies Indian Highly Fractionated Land Loans Subtotal, Loans Regular and Supplemental Appropriations: Administrative expenses TOTAL APPROPRIATION 22-32 FARM SERVICE AGENCY AGRICULTURAL CREDIT INSURANCE FUND Protect mić (On basis of adjusted appropriation) 2009 Actual 2010 Estimated Increase or Decrease 201 i Estimated Loan level Subsidy Loan Level Subsidy Loan Level Subsidy Loan level Subsidy $560,236,000 $35,575,000 $650,000,000 $26,520,000 -$175,000,000 +$6,350,000 $475,000,000 $32,870,000 1,085,256,000 127,952,000 1,000,000,000 47,400,000 -100,000,000 +7,140,000 900,000,000 54,540,000 173,367,000 20,440,000 0. O 0. () 0. - () 3,940,000 248,000 3,940,000 () -1,940,000 0 2,000,000 {} 100,000,000 {} 100,000,000 0. -40,000,000 0. 60 ,000,000 {} 1,922,799,000 184,215,000 1,753,940,000 73,920,000 -316,940,000 +13,490,000 1,437,000,000 87,410,000 1,238,768,000 4,088,000 1,500,000,000 5,550,000 {) +150,000 1,500,000,000 5,700,000 i,210,670,000 30, 146,000 1,500,000,000 35,100,000 0 -150,000 I,500,000,000 34,950,000 149,986,000 20,683,000 170,000,000 23,902,000 -25,965,000 -3,982,000 144,035,000 $9,920,000 2,599,424,000 54,917,000 3,170,000,000 64,552,000 -25,965,000 -3,982,000 3,1 44,035,000 60,570,000 {} 0 75,000,000 1,065,000 {} +1,178,000 75,000,000 2,243,000 0. 0 75,000,000 278,000 {} +7,000 75,000,000 285,000 0. 0. 150,000,000 1,343,000 0. +1,185,000 150,000,000 2,528,000 0 0. 10,000,000 793,000 0. -$79,000 10,000,000 214,000 4,522,223,000 239,132,000 5,083,940,000 140,608,000 -342,905,000 (I) +10,114,000 (2) 4,741,035,000 150,722,000 0 317,323,000 {} 321,093,000 () +5,027,000 (3) 0 326,120,000 4,522,223,000 556,455,000 sogº.g40,000 i * * 46.70,000 3:305,000. 15,141,000 4,741,035,000 476,842,000 s program. Direct loans Farm Ownership Farm Operating Farm Operating - Carryover Subtotal Farm Operating - ARRA Farm Operating - ARRA -Carryover Subtotal Emergency Disaster - Carryover Indian Land Acquisition Bołł Weevil Eradication Total Direct Loans and Subsidies Guaranteed Loans Farm Ownership, Unsubsidized Farm Ownership, Unsubsidized - Carryover Subtotal Farm Operating, Unsubsidized Farm Operating, Unsubsidized - Carryover Subtotal Farm Operating, Subsidized Total Guaranteed Loans and Subsidies Conservation Loans Direct Guaranteed Total Conservation Loans and Subsidies Indian Highly Fractionated Land Subtotal Loans Regular and Supplemental Appropriations Subtotal Carryover - Total, Loxins and Subsidies Above Admunistrative expenses GRAND TOTAL AGRICULTURAL CREDIT INSURANCE FUND dºssº T -- FARM SERVICE AGENCY o t r (On basis of available funds) 2009 Actual 2010 Estimated increase or Decreas: 20 i ! Estimuted Loan Level Subsidy Loan Level Subsidy Loan Level Subsidy Loan Level Subsidy $560 000 000 $35,560 000 $650 000 000 $26,520 000 -$175,000 000 +$6 350 000 $475 000 000 $32,870,000 . I 056 359 OOO 124,545,000 Ł,000,000,000 47400 000 -100 000,000 +7.1 40 000 900,000,000 54 540 000 0 0. 2,109,000 100,000 -2. 109,000 -100,000 0. O l,056,359,000 ..]24,545,000 } 002 )09 000 47,500,000 - O2,109 000 +7,040 000 900 000 000 54,540,000 170 105 000 20,055,000 - 0. O 8,522,000 385,000 -8.122,000 -385,000 O 0 | 70 165 000 20,055,000 8 22,000 385,000 -8, 122,000 -385,000 () () 30,401 000 4,323,000 56 450,000 2,083 000 +20,000 +3.84% 000 56 470,000 5,924,000 0. O 3 940 000 O' - 1,940 000 0 2,000 000 6 100,000,000 0 300,000,000 O –40,000 000 0 60,000,000 O 1,916,865,000 184,433,000 1,820,621,000 76,488,000 -327,1st,000 +16,346,000 1,493,470,000 93,334,000 I,238 768,000 4,088,000 1,500,000 000 5,550,000 O + $50 000 1 500,000,000 5 700 000 33 942 000 | 12 000 --- - ! 272 710 000 4,200 000 t 500 000 000 5550 000 0 +150 000 . i 500,000 000 5,700 000 ł,210,670 000 30, 146,000 1 500,000 oed 35,100,000 O - 50 000 1,500,000,000 34,950,000 24 40.5 000 608.000 1,235 075,000 30,754 000 1 500,000,000 35,100,000 O -150,000 1,500,000,000 34 950,000 149 709 OOO 20 645 000 170 000,000 23.902 000 .25 965 000 -3 982,000 144,033,000 |9 920 000 2,657,494,000 35.535,000 TST70,000,000 64,552,000 –25,965,000 -3,982,000 3,144,035,000 60,570,000 O 0 75,000,000 1065 000 O +1,178 000 75,000 000 2243 000 O 0 75 000 000 278,000 O +2,000 75,000 000 . . 285,000 0. 0. 150,000,000 1,343,000 {} +1,185,000 150,000.000 2,528,000 Q () 10 000 000 793,000 {} -579 000 10,000,000 214,000 4,485,6] 1 000 235,039,000 5,083 940,000 140,608,000 -342,905,000 +10, 14,000 4,741,035 000 150.722,000 88,748,000 5,043,000 66.681.000 2,568,000 -10,241 000 +3.356 000 56,470 000 : 5.924,000 4,574,359,000 240,082,000 5,150,621,000 143,176,000 -353,116,000 +!3,470,000 4,797,505,000 156,646,000 316,903,000 321,093,000 +5,027,000 326,420,000 —4:º-ºº-ºººººº-ººººº--ºllº—tº- 4,327,505,000_432,766,000. . 48 (1) A decrease of $342,905,000 for the Agricultural Credit Insurance Fund (ACIF) loan program levels ($5,083,940,000 available in FY 2010) consisting of - (a) (b) (c) (d) (e) A decrease of $25,965,000 for guaranteed farm operating subsidized loans that enable family An decrease of $175,000,000 for direct ownership loans to encourage beginning farmers to 22-34 Justification of Increases and Decreases establish more productive farming operations ($650,000,000 available in FY 2010). The requested level of $475,000,000 represents the return to a more traditional funding request. For several years, demand for this program exceeded available funding creating a backlog of unfunded requests at the field level. The FY 2009 supplemental and FY 2010 enacted appropriations have helped resolve the backlog. . - A decrease of $100,000,000 for direct farm operating loans to assist family farmers in maintaining productive farming operations ($1,000,000,000 available in FY 2010), The requested level of $900 million should meet demand for direct operating loans in FY 2011. The estimated loan level reflects the expectation that the FY 2009 supplemental an FY 2010 enacted appropriations will resolve the backlog of unfunded loans. A decrease of $1,940,000 for Indian land acquisition loans to enable Indian tribes to purchas privately held lands that lie within their reservations ($3,940,000 available in FY 2010). The decrease in proposed loan level is commensurate with a decrease in demonstrated demand for this program over the last several years. * - A decrease of $40,000,000 for boll weevil eradication loans to eliminate the boll weevil and prevent reinfestation ($100,000,000 available in FY 2010). The decrease for boll weevil eradication loans is due to recent progress made in actual eradication efforts which in turn results in lower demand. The requested loan level is expected to be adequate to meet demand. farmers to obtain credit from commercial lenders in rural communities ($170,000,000 available in FY 2010}, - : The $144 million in program level requested will provide about 727 guaranteed farm operating subsidized loans. Demand for this program has declined since programmatic regulations were revised to tighten lending requirements. The decline in demand in this program did not reflect an overall decline in the need for operating loans; rather, the revised regulations resulted in increased demand in the direct and guaranteed unsubsidized operating loan programs. 49 22-35 2) A net increase of $10,114,000 for the Agricultural Credit Insurance Fund (ACIF) loan subsidy ($140,608,000 available in FY 2010): The subsidy amounts support the proposed FY 2011 direct and guaranteed loan levels of $4.741 billion. The net increase is comprised of the following increases and decreases: For direct loans, there is a total increase of $13,490 million in subsidy to support proposed direct loan levels. The change is comprised of an increase of $6.350 million for direct ownership loan subsidy and an increase of $7,140 million for direct operating loan subsidy. The increase in subsidy costs is due to increased subsidy rates. Subsidy rate increases are largely due to projected increases in defaults. For guaranteed loans, there is a total decrease of $3.982 million in subsidy that is comprised of: an increase of $150 thousand in ownership loans; a decrease of $150 thousand in operating unsubsidized loans; and a decrease of $3.982 million in operating subsidized loans. The minimal increase in ownership loans and decrease operating unsubsidized loans are due to corresponding changes in subsidy rates. The decrease in operating subsidized loans is due to a $25.5 million reduction in requested loan level combined with a slightly lower subsidy rate. For conservation loans, there is an increase of $1.185 million that is comprised of $1.178 million for direct loans and $7 thousand for guaranteed loans due to increased subsidy TateS. - For Indian highly fractionated land loans, there is a decrease of $579 thousand due to the decreased subsidy rate. 3) An increase of $5,027,000 for Agricultural Credit Insurance Fund (ACIF) administrative expenses ($321,093,000 available in FY 2010): This increase is attributable to increases in personnel compensation and increased operating costs. See the FSA Salaries and Expenses section of these explanatory notes for further detaiis, 50 22-36 FARM SERVICE AGENCY AGRICULTURAL CREDIT INSURANCE FUND DIRECT FARM OWNERSHIP PROGRAM Geographic Breakdown of Obligations 2009 Actual and Estimated 2010 and 2011 Alabama Alaska Arizofia Arkansas California Colorado Connecticut Delaware Florida Georgia Hawaii Idaho {#inois Indiana Iowa Kansas Kentucky Louisiana Maine Maryland Massachusetts Michigan Minnesota Mississippi Missouri Montana Nebraska Nevada New Hampshire New Jersey New Mexico New York North Carolina North Dakota Ohio Oklahoma Oregon Pennsylvania Rhode Island South Carolina South Dakota Tennessee Texas Utah Vermont Virginia Washington West Virginia Wisconsin Wyoming District of Columbia Puerto Rico Other Countries Undistributed Total, Available or Estimate 2009 Actuai 2010 Estimated 2011 Estimated $1,758,000 $2,040,536 $1,491, 161 125,000 145,089 106,027 1,012,000 1,174,643 858,393 4,288,000 4,977,143 3,637,143 5,084,000 5,901,071 4,312,321 5,218,000 6,056,607 4,425,982 225,000 261, #6 i 190,848 200,000 232,143 169,643 2,413,000 2,800,804 2,046,741 5,318,000 6,172,679 4,510,804 1,170,000 1,358,036 992,41 6,744,000 7,827,857 5,720,357 29,974,000 34,791,250 25,424,375 13,789,000 i 6,005,089 1 1,696,027 66,577,000 77,276,875 56,471,563 38,353,000 44,516,875 32,531,563. 18,930,000 21,972,321 16,056,696 593,000 688,304 502,991 1,252,000 1,453,214 1,061,964 600,000 696,429 508,929 1,659,000 1,925,625 1,407,188 15,178,000 F7,617,321 12,874, 196 36,566,000 42,442,679 31,015,804 1,605,000 1,862,946 1,361,384 19,306,000 22,408,750 16,375,625 8,904,000 10,331,518 7,549,955 51,850,000 60,183,036 43,979,911 1,023,000 1,187,41 l 867,723 934,000 1,084, 107 792,232 695,000 806,696 589,509 3,894,000 4,519,821 3,302,946 4,524,000 5,251,071 3,837,321 . 4,350,000 5,049,107 3,689,732 13,207,000 15,329,554 1 1,202,366 16,489,000 19,139,018 13,986,205 32,241,000 37,422,589 27,347,277 5,341,000 6, 199,375 4,530,313 | 1,221,000 13,024,375 9,517,813 207,000 240,268 175,580 6, 108,000 7,089,643 5, 180,893 32,379,000 37,582,768 27,464,330 8,866,000 10,290,893 7,520,268 i8,169,000 21,089,018 15,41 1,205 8,319,000 9,655,982 7,056,295 1,999,000 2,320,268 1,695,580 3,929,000 4,560,446 3,332,634 8,057,000 9,351,875 6,834,063 2,799,000 3,248,839 2,374, 152 30,209,000 35,064,018 25,623,705 2,021,000 2,345,804 1,714,24] () {} () 4,331,000 5,027,054 3,673,646 () {} {} 0 () () 560,000,000 650,000,000 475,000,000 51 GUARANTEED FARM OWNERSHIP LOAN PROGRAM Alabama Alaska Arizona Arkansas California Colorado Connecticut Delaware Florida Georgia Hawaii Idaho Illinois Indiana Iowa Kansas Kentucky Louisiana Maine Maryland Massachusetts Michigan Minnesota Mississippi Missouri Montana Nebraska Nevada New Hampshire New Jersey New Mexico New York North Carolina North Dakota Ohio Oklahoma Oregon Pennsylvania Rhode Island South Carolina South Dakota Tennessee Texas Utah Vermont Virginia Washington West Virginia Wisconsin Wyoming District of Columbia Puerto Rico Other Countries Undistributed Total, Available or Estimate 22-37 FARM SERVICE AGENCY AGRICULTURAL CREDIT ſnSURANCE FUND Geographic Breakdown of Obligations 2009 Actual and Estimated 2010 and 20: 1 2009 Actual 2010 Estimated 20] 1 Estimated $29,376,000 $34,622, 184 $34,622, 184 0 0 0 2,424,000 2,856,896 2,856,896 41,370,000 48,758,162 48,758, 162 18,606,000 21,928,798 21,928,798 18,146,000 21,386,647 21,386,647 3,312,000 3,903,482 3,903,482 429,000 505,614 505,614 6,563,000 7,735,069 7,735,069 35,249,000 41,544,028 41,544,028 3,793,000 4,470,382 4,470,382 14,844,000 17,494,952 17,494,952 64,964,000 76,562,218 76,562,248 54,214,000 63,895,939 63,895,939 78,391,000 92,390,647 92,390,647 20,132,000 23,727,322 23,727,322 38,265,000 45,098,648 45,098,648 6,567,000 7,739,784 7,739,784 2,944,000 3,469,76i 3,469,761 3,250,000 3,830,409 3,830,409 6,108,000 7, 198,812 7,198,812 40,827,000 48, i i8, 189 48, l l 8, 189 60,619,000 71,444,791 71,444,791 7,978,000 9,402,770 9,402,770 58,652,000 69,126,510 69,126,510 23,422,000 27,604,875 27,604,875 55,038,000 64,867,095 64,867,095 4,024,000 4,742,636 4,742,636 502,000 591,651 591,651 6,605,000 7,784,570 7,784,570 7,967,000 9,389,806 9,389,806 32,252,000 38,01 I,802 38,011,802 40,448,000 47,671,504 47,671,504 14,889,000 17,547,988 17,547,988 | 14,879,000 135,394,945 135,394,945 30,511,000 35,959,881 35,959,881 14,207,000 16,744,192 16,744, tº2 38,033,000 44,825,215 44,825,215 607,000 715,403 7 15,403 22,816,000 26,890,651 26,890,651 32,163,000 37,906,907 37,906,907 15,161,000 17,868,564 17,868,564 21,047,000 24,805,730 24,805,730 9,090,000 10,713,360 ł0,713,360 #2,835,000 15,127,170 15,127,170 i 1,449,000 13,493,647 13,493,647 #2,261,000 14,450,660 #4,450,660 1,985,000 2,339,496 2,339,496 129,164,000 152,231,066 152,231,066 3,856,000 4,544,633 4,544,633 {} {} {} 479,000 564,543 564,543 {} * 0 0. {} O {} 1,272,710,000 1,500,000,000 1,500,000,000 52 22-38 FARM SERVICE AGENCY AGRICULTURAL CREDIT INSURANCE FUND DIRECT FARM OPERATING LOAN PROGRAM Geographic Breakdown of Obligations 2009 Actual and Estimated 2010 and 201 i Alabama Alaska Artzona Arkansas California Colorado Connecticut Delaware Florida Georgia Hawaii Idaho Illinois Indiana Howa Kansas Kentucky Louisiana Maine Maryland Massachusetts Michigan Minnesota Mississippi Missouri Montana Nebraska Nevada New Hampshire New Jersey New Mexico New York North Carolina Yorth Dakota Ohio Oklahoma Oregon Pennsylvania Rhode Island South Carolina South Dakota Tennessee Texas Utah Vermont Virginia Washington West Virginia Wisconsin Wyoming District of Columbia Puerto. Rico Other Countries Undistributed Total, Available or Estimate 2009 Actual 2010 Estimated 20i i Estimated $6,879,910 $6,605,207 $5,932, 176 616,000 503,316 452,031 6,504,400 5,950,733 5,344,388 34,707,320 31,123,077 27,951,819 26,349,620 26,173,257 23,506,356 8,896,500 7,826,730 7,029,232 568,000 503,346 452,031 125,000 102,134 91,727 7,901,900 7,162,450 6,432,639 30,344,010 31,362,479 28,166,828 2,031,000 1,765,692 1,585,778 16, 194,140 14,404,974 #2,937,192 14,131,240 14,458,083 12,984,890 5,708,500 5,099,344 4,579,751 57,612,940 58,405,101 52,453,965 44,051,180 40,379,682 36,265,231 38,558,590 34,484,510 30,970,742 15,058,570 H5,302,935 13,743,657 7,574,000 6,217,098 5,583,613 3,323,000 2,818,897 2,531,668 3,230,000 2,659,568 2,388,574 30,605,890 31,766, it 3 28,529,333 56,658,710 52,258,270 46,933,46; 12,773,360 i 1,104,821 9,973,305 16,913,870 17,065,359 15,326,500 i0,653,310 10,581,078 9,502,929 58,638, 100 60,361,170 54,210,723 1,576, 180 1,349,802 1,212,266 1,826,000 1,634,960 1,468,368 2,481,330 2,312,313 2,076,702 6,643,500 5,888,636 5,288,618 26,045,200 23,209,738 20,844,803 19,970,710 20,679,267 18,572,172 32,593,200. 27,764,913 24,935,832 7,405,520 6,968,804 6,258,724 . 41,048, 170 37,622,883 33,789,333 18,743,110 18,727,283 16,819,083 48,397,780 43,177,336 38,777,820 271,000 221,426 198,864 20,341,498 20,708,682 18,598,589 36,893,070 38,092,699 34,21 1,277 25,012,470 24,448,419 21,957,269 66,704,654 64,309,261 57,756,526 24,130,280 22,855,129 20,526,326 1 i,936,000 9,949,482 8,935,688 20,447,870 19,019,795 17,081,790 19,352,600 20,082,805 18,036,485 {0,4}9,650 9,189,505 8,253,239 90,822,020 80,469,304 72,269,957 2, $58,450 2,919,397 2,621,928 - {} 0 {} 4,425,000 3,934,200 3,533,328 $35,000 127,463 114,475 {} () 0 1,056,359,292 1,002, 109,000 900,000,000 53 22-39 FARM SERVICE AGENCY AGRICULTURAL CREDIT INSURANCE FUND GUARANTEED FARM OPERATING SUBSADIZED LOAN PROGRAM Geographic Breakdown of Obligations 2009 Actual arid Estimated 2010 and 20 ! ! Alabama Ajaska Arizona Arkansas California Colorado Connecticut Delaware Florida Georgia Hawati Idaho Illinois Indiana łowa Kansas Kentucky Louisiana Ma:ne Maryland Massachusetts Michigan Minnesota Mississippi Missouri Montana Nebraska Nevada New Hampshire New Jersey New Mexico New York North Carolina North Dakota Ohio Oklahoma Oregon Pennsylvania Rhode Island South Carolina South Dakota Tennessee Texas Utah Vermont Virginia Washington West Virginia Wisconsin Wyoming District of Columbia Puerto Rico Other Countries Undistributed Total, Available or Estimate 2009 Actual 2010 Estimated 2011 Estimated () {} () {} {} {} {} 0. 0 () 0 () 0 0 {} {} 0 {} {} 0. {} {} 0. 0 0. 0 0 0 0 () 0. 0 0 $350,000 $397,438 $336,735 1 1,473,000. 13,028,008 ł 1,038,171 832,000 944,766 800,467 18,913,000 21,476,398 18,196, 194 9,180,000 10,424,223 8,832,076 1,592,000 1,807,774 1,531,663 {} () {} {} 0 0 0. () 0 {} () {} 3,763,000 4,273,023 3,620,382 21,924,000 24,895,497 21,093,076 384,000 436,046 369,446 2,477,000 2,812,723 2,383,121 1,259,000 1,429,640 1,2} 1,284 ł6,750,000 19,020,233 16, 1 ; 5,172 0. {} 0. 350,000 397,438 336,735 870,000 987,917 837,027 241,000 273,664 231,866 1,362,000 1,546,600 1,310,380 891,000. 1,01 1,763 857,231 7,108,000 - 8,071,392 6,838,605 154,000 174,873 $48,163 3,434,000 3,899,432 3,303,851 - () 0. {} 7,790,000 8,845,828 7,494,757 0. () 0 400,000 454,215 384,840 9,876,000 11,214,556 9,501,698 571,000 648,391 $49,359 800,000 908,429 769,680 785,000 891,396 755,248 309,000 350,881 297,289 730,000 828,941 702,333 {). 0 Q 400,000 454,215 384,840 23,561,000 26,754,370 22,668,034 1,180,000 1,339,933 1,135,278 {} {} 0 0 Ö 0 0 {} 0. 0 {} {} 149,709,000 170,000,000 144,035,000 54 22–40 FARM SERVICE AGENCY AGRICULTURAL CREDIT INSURANCE FUND GUARANTEED FARM OPERATING UNSUBSIDIZED LOAN PROGRAM Geographic Breakdown of Obligations 2009 Actual and Estimated 2010 and 20I I Aiabama Aiaska Arizona Arkansas California Colorado Connecticut Dejaware Florida Georgia Hawaii Idaho Illinois Indiana Iowa Kansas Kentucky Louisiana Maine Maryland Massachusetts Michigan Minnesota Mississippi Missouri Montana Nebraska Nevada New Hampshire New Jersey New Mexico New York Worth Carolina North Dakota Ohio Oklahoma Oregon Pennsylvania Rhode Island South Carolina South Dakota Tennessee Texas Utah Vermoni Virginia Washington West Virginia Wisconsin Wyoming District of Columbia Puerto Rico Other Countries Undistributed Total, Available or Estimate 2009 Actual 20 i O Estimated 20 i ! Estimated $4,244,000 $5, i54,343 $5,154,343 0. {} {} 13,050,000 15,849,240 ls,849,240 67,787,000 82,327,389 82,327,389 37,194,000 45,172,156 45,172,156 14,896,000 18,091,209 i8,091,209 5,743,000 6,974,880 6,974,880 248,000 301,196 301,196 7,257,000 8,813,635 8,813,635 47,025,000 $7,1 1 1,916 57,1 1,916 81,000 98,375 98.375 35,708,000 43,367,407 43,367,407 32,082,000 38,963,626 38,963,626 29,897,000 36,309,941 36,309,94} 50,316,000 61, 108,840 6},108,840 29,985,000 36,416,817 36,416,817 18,368,000 22,307,957 22,307,957 84,428,000 102,537,903 102,537,903 3,582,000 4,350,343 4,350,343 2,593,000 3,149,201 3,149,201 1,628,000 1,977,208. 1,977,208 35,079,000 42,603,486 42,603,486 82,292,000 99,943,728 99,943,728 15,357,000 ł8,651,094 I 8,651,094 24,707,000 30,006,680 30,006,680 21,920,000 26,621,865 26,621,865 50,022,000 60,751,776 60,751,776 1,363,000 1,655,365 1,655,365 472,000 573,245 573,245 1,308,000 1,588,567 1,588,567 13,656,000 6,585,228 16,585,228 43,834,000 53,232,800 53,232.800 21,286,000 25,851,871 25,851,871 34,830,000 42,301,075 42,301,075 38,368,000 46,597,980 46,597,980 23,027,000 27,966,318 27,966,318 20,882,000 25,361,213 25,361,213 24,612,000 29,891,302 29,891,302 482,000 585,390 585,390 10,326,000 12,540,939 i2,540,939 28,670,000 34,819,748 34,819,748 12,065,000 14,652,956 14,652,956 92,890,000 i 12,815,011 | 12,815,011 5,507,000 6,688,258 6,688,258 14, 153,000 17, 188,835 17,188,835 9,568,000 l t,620,347 1 1,620,347 41,351,000 50,226,837 50,220,837 412,000 500,374 500,374 75,362,000 9],527,235 91,527,235 5,165,000 6,272,898 6,272,898 0 0. O 0 O 0 {} 0 0 0 O {} 1,235,075,000 1,500,000,000 1,500,000,000 55 22–4] FARM SERVICE AGENCY AGRICULTURAL CREDIT INSURANCE FUND EMERGENCY LOAN PROGRAM Geographic Breakdown of Obligations 2009 Actual and Estimated 2010 and 2011 2009 Actual $17,000 0 0 294,000 ł, 19,000 0 () 0 107,000 i,517,000 0 {} 0 () 174,000 615,000 338,000 10,067,000 0 0 88,000 1,842,000 55,000 0. 0 3 l i,000 0 0 0 692,000 1,098,000 385,000 983,000 1,325,000 295,000 0 254,000 0 0. 765,000 0 775,000 5,061,000 0 599,000 90,000 939,000 0 431,000 }68,000 0 2010 Estimated” Alabama Alaska Arizona Arkansas California Colorado Connecticut Delaware Florida Georgia Hawaii Idaho {}linois Indiana Iowa Kansas Kentucky Louisiana Maine Maryland Massachusetts Michigan Munnesota Mississippi Missouri Montana Nebraska Nevada New Hampshire New Jersey New Mexico New York North Carolina North Dakota Ohio Okiahoma Oregon Pennsylvania Rhode Island South Carolina South Dakota Tennessee Texas Utah Vermont Virginia Washington West Virginia Wisconsin Wyoming District of Columbia Puerto Rico Other Countries Undistributed Total, Available or Estimate () O 0 30,40},000 $56,450,000 56,450,000 20 i i Estitnated” $56,470,000 56,470,000 *A geographic breakdown of Emergency Loan obligations is not projected due to the nature of the program 56. 22-42 FARM SERVICE AGENCY - AGRICULTURAL CREDIT INSURANCE FUND BOLL WEEVIL ERADICATION, INDIAN LAND ACQUISITION LOANS AND OTHER PROGRAMS Geographic Breakdown of Obligations 2009 Actual and Estimated 2010 and 2011 BOLL WEEVIL ERADICATION LOAN PROGRAM 2009 Actual 2010 Estimated 2011 Estimated Arkansas $14,161,290 Texas 85,838,670 Undistributed 0 $100,000,000 $60,000,00 Total Available or Estimate 99,999,960 100,000,000 60,000,000 INDIAN LAND ACQUISITION LOAN PROGRAM 2009 Actual 2010 Estimated 2011 Estimated Undistributed - () $3,940,000 $2,000,000 Total Available or Estimate - 0 3,940,000 2,000,000 CONSERVATION LOANS! 2009 Actual 2010 Estimated 2011 Estimated Direct, Undistributed 0 $75,000,000 $75,000,000 Guaranteed, Undistributed 0 75,000,000 75,000,000 Total Available or Estimate 0 150,000,000 150,000,000 INDIAN HIGHLY FRACTIONATED LAND PROGRAM' 2009 Actual 2010 Estimated 20 i ! Estimated Undistributed 0 . $10,000,000 $10,000,000 Total Available or Estimate - 0 10,000,000 10,000,000 'Because Conservation and Indian Highly Fractionated Land are new programs, we have no historical basis on which to project geographic obligations. 57 22-43 FARM SERVICE AGENCY Agricultural Credit Insurance Fund Classification by Objects 2009 Actual and Estimated 2010 and 2011 Object Class 2009 0 i () 20 ! I 5.3 Purchases of goods and services $316,903,000 $321,093,000 326,120,000 1.0 Grants, subsidies and contributions 240,082,000 143,176,000 156,646,000 9.0 Total Obligations 556,985,000 464,269,000 482,766,000 58 22-44 FARM SERVICE AGENCY Agricultural Credit Insurance Fund SUMMARY OF RECOVERY ACT FUNDING Program/Project/Activity 2009 2010 20 | 1 Direct Farm Operating Loans (subsidy) * * * * * $20,055,000 $385,000 0. Loan Level................. ......................... . .($170,105,000) ($8,122,000) (0) Project Statement - Recovery Act (On basis of available funds) 2009 2010 Increase or 20 || Project Actual Estimated Decrease Estimated Direct Farm Operating Loans (subsidy)..... $20,055,000 $385,000 -$385,000 0 Unobligated balance brought forward - from prior years........................................ 0 || -385,000 +385,000 0 Unobligated balance carried forward to next year.…. 385,000 0 0 0 Total appropriation..................................... 20,440,000 0 0 0 Program Implementation Activities: Objective: To provide operating capital for family farmers and ranchers. The Recovery Act provided additional subsidy of $20.44 million ($173.367 million in loan level) for FSA' Direct Farm Operating Loan (OL) program. The Direct OL program, as with all FSA farm loan programs, assists eligible family farmers and ranchers in building and sustaining successful farm operations, Direct OL loans are used to purchase items necessary for family farmers to continue operations. As such, they may be used to purchase livestock, farm equipment, feed, seed, fuel, farm chemicals, insurance, and other operating expenses. Operating loans may also be used to pay for minor improvements to buildings, costs associated with land and water development, and family subsistence, and to refinance debts under certain conditions. Given the timing of the additional loan funds made available through the Recovery Act, much of the funding was used to cover spring planting expenses. These funds did have an immediate impact on main street businesses in rural communities. Completed Actions: A total of $170.1 million was obligated in 2009, providing funding for 2,839 loans. FSA maintained all stimulus funds at its Washington, DC, headquarters, Maintaining the funds in one location resulted in greater transparency, improved funds control, and allowed for the most efficient and expedient means of distribution, FSA targeted funds to minority and beginning farmers as required by the Consolidated Farm and Rural Development Act. - Planned Actions: FSA will use the remaining Recovery Act money to fund approximately 136 loans. A reduced subsidy rat in FY 2010 makes $8.1 million available in loan level. Performance Measures: Performance Data 2009 Actual 2010 Target 2011 Targe Increase lending to beginning and socially disadvantaged farmers and ranchers (%) - 37.9% 38.3% 38.7% Reduce average processing time for direct loans (# days) 33.5 days 33 days 32.5 days 59 22-45 FARM SERVICE AGENCY AGRICULTURAL CREDIT INSURANCE FUND DIRECT FARM OPERATING LOAN PROGRAM-ARRA Geographic Breakdown of Obligations 2009 Actual and Estimated 2010 and 2011 Alabama Alaska Arizona Arkansas California Colorado Connecticut Delaware Fiorida Georgia Hawaii Idaho {}linois Indiana Iowa Kansas Kentucky Louisiana Maine Maryland Massachusetts Michigan Minnesota Mississippi Missouri Montana Nebraska Nevada New Hampshire New Jersey New Mexico New York TNorth Caroiina North Dakota Ohio Oklahoma Oregon Pennsylvania Rhode Island South Carolina South Dakota Tennessee Texas Utah Vermont Virginia Washington West Virginia Wisconsin Wyoming District of Columbia Puerto Rico Other Countries Undistributed Total, Available or Estimate 2009 Actual 20 i O Estimated 2011 Estimated $1,204,090 $57,492 0. . () 0 () 778,60 37,176 0. 3,383,680 161,561 {} 5,683,380 .. 271,365 {} 682,500 32,587 0. 48,000 2,292 {} 0 {} {} 864,100 . 41,258 () 8,039,990 383,886 {} 130,000 6,207 0 1,435,860 68,558 Ö 3,563,790 170,16} {} 532,500 25,425 0. 13,868,060 662,159 {} 5,368,820 256,345 {} 3,646,410 174,105 () 3,670,430 175,252 0 35,000 1,67; {} 127,000 6,064 0 25,000 1,194 {} 8,272,110 394,969 {} 7,299,290 348,520 {} 817,640 39,040 0 3,972,130 ł89,658 () 2,296,690 109,660 {} 15,236,900 727,517 0. 75,820 3,620 {} 175,000 8,356 Ö 348,670 16,648 G 563,500 26,905 {} 2,360,800 112,721 0 5,338,290 254,888 {} 1,387,800 66,263 {) 1,123,480 53,643 O 5,027,830 240,064 {} 4,176,890 i99,434 {} 4,446,220 212,294 0 {} 0 {} 5,003,502 238,903 Ó 9,727,930 464,480 {} 4,909,530 234,416 {) 12,002,346 573,077 () 3,844,720 i83,431 {} 241,000 | 1,507 Ö 2,830, 130 135,130 {} 5,226,400 249,545 {} 827,350 39,504 0 7,662,980 365,885 {} 1,414,550 67,541 {} 0 0. {} 390,000. $8,62] 6 21,000 1,003 {} 0 O 0 170,104,708 8,122,000 0 60 22g-l l AGRICULTURAL CREDIT INSURANCE FUND STATUS OF PROGRAM Current Activities: - Through the Agricultural Credit Insurance Fund (ACIF), FSA offers direct and guaranteed loans to farmers temporarily unable to obtain regular commercial credit. Under the guaranteed loan program, FSA guarantees up to 95 percent of the principal amount of loans made by conventional agricultural lenders. Applicants unable to qualify for a guaranteed loan may be eligible for a direct loan made and serviced by FSA loan officers, who also provide loan supervision and credit counseling. • Farm Ownership Loans. FSA makes direct and guaranteed loans to family farmers to purchase farmland; restructure debts, including utilizing real estate equity to refinance heavy short-term debts; and modify their operations to comply with sanitation and pollution abatement requirements, keep up with advances in agricultural technology, better utilize their land and labor resources, or meet changin market requirements. • Farm Operating Loans. Direct and guaranteed operating loans may be made to pay costs incident to reorganizing a farming system for more profitable operations; purchasing livestock, poultry, and farm equipment; purchasing feed, seed, fertilizer, insecticides, and farm supplies and meeting other essential operating expenses; financing land and water development, use, and conservation; developing recreation and other non-farm enterprises; and refinancing existing indebtedness. Under the law, at least 50 percent of direct farm operating loan funding must be reserved for qualified beginning farmers and ranchers during the first 11 months of the fiscal year. • Emergency Loans, Direct loans are made available in designated counties and contiguous counties where property damage and/or severe production losses have occurred as a result of natural disaster. • Indian Tribe Land Acquisition Loans. Direct loans are made to eligible Native American tribes to assist them in repurchasing lands within the boundaries of their reservations and maintaining ownership for future generations. • Boll Weevil Eradication Loans. Direct loans assist producer associations and State governmental agencies in cotton-producing States to carry out boil weevil eradication programs. The following table reflects FY 2009 ACIF program activity: FY 2009 Actual Agricultural Credit Insurance Fund Loans and Obligations r (Dollars in Thousands) - Farm Loans Program: Number of Loans Obligations Direct Loans 24, 137 $1,916,865 Guaranteed Loans 10,093 2,657,494 Totals 34,230 4,574,359 Direct and guaranteed loan programs provided assistance totaling $1.5 billion to beginning farmers during FY 2009. Loans for socially disadvantaged farmers totaled $435 million, of which $186 million was in the farm ownership program, and $249 million in the farm operating program. Selected Examples of Recent Progress: Lending to beginning farmers was strong during FY 2009, FSA loaned or guaranteed beginning farmer loans for over 13,000 borrowers. There was a dramatic 696-percent increase in the number of farmers who were able to obtain direct farm ownership down payment loans. 61 22g-12 lirect operating loans also demonstrated a 34-percent increase in the number of beginning farmers assisted s compared to FY 2008. Overall, lending to beginning farmers was 24 percent above the FY 2008 levels. ending to minority and women farmers was a significant portion of overall assistance provided, with ; million in loans and loan guarantees provided to more than 5,000 farmers. This represents an increase 20 percent in the number of minority borrowers and an increase of 15 percent in the overall dollar value. utreach efforts by FSA field offices to promote and inform beginning and minority farmers about ailable FSA funding has resulted in increased lending to these groups. uring FY 2009, FSA utilized the Secretary's transfer authority (provided to ACIF in the annual propriations act) to fund critical farm loan needs. Through the use of this authority, additional direct erating funds totaling $110 million and guaranteed operating unsubsidized funds of $142.9 million were ade available in FY 2009 by transfer of unused funds from the guaranteed operating with interest sistance loan program. This transfer provided funding for 1,838 direct operating and 654 guaranteed erating without interest assistance loan applicants, FSA received Recovery Act funding to support 173 million in direct operating loans as well. 62 22–46 FARM SERVICE AGENCY The estimates include appropriation language º this item as follows (deleted matter enclosed in brackets Reforestation Pilot Program [Sec. 739. There is hereby appropriated $800,000 to the Farm Service Agency to carry out a pil program to demonstrate the use of new technologies that increase the rate of growth of re-foreste hardwood trees on private non-industrial forests lands, enrolling lands on the coast of the Gulf o Mexico that were damaged by Hurricane Katrina in 2005.] The FY 2011 Budget proposes no funding for this program. 63 22-47 REFORESTATION PILOT PROGRAM Appropriations Act, 2010 * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * $800,000 Budget Estimate, 2011 …….....................….............. wº- Decrease in Appropriation ............................................. * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * sº a t < * * * * * * * * * * * * * -800,000 SUMMARY OF INCREASES AND DECREASES (On basis of appropriation) 2010 Program 20 i ; Item of Change Estimated Changes Estimated Reforestation of lands on the coast of the Gulf of Mexico damaged by Hurricane Katrina.......... $800,000 -$800,000 2= PROJECT STATEMENT (On basis of appropriation) 2009 2010 20 ! I Project Actual Estimated Decrease Estimated Reforestation of lands on the coast of the Gulf of Mexico damaged by Hurricane - Katrina.…...............…............................... $794,000 $800,000 -$800,000 (1) 0 Total Appropriation................................... 794,000 800,000 -800,000 0 Justification of Decrease (1) A decrease of $800,000 for the Reforestation Pilot Program ($800,000 available in 2010): The Reforestation Pilot Program has been funded in FY 2008 through FY 2010. Three years of experience will provide useful information about the technologies demonstrated under the pilot program. No additional funding is requested due to fiscal constraints. Classification by Objects 2009 Actual and Estimated 2010 and 2011 Object Class 2009 2010 2011 410 Grants, subsidies, and contributions $794,000 $800,000 {} Total direct obligations 794,000 800,000 0. RR-087 TY-2 64 22g-13 REFORESTATION PILOT PROGRAM STATUS of PROGRAM Sec. 728 of the 2009 Omnibus Appropriations Act, Public Law 111-8, enacted March 11, 2009, provided $794,000 to the Farm Service Agency to continue a pilot program demonstrating the use of new technologies intended to increase the rate of growth of reforested hardwood trees on private, non-industrial forest lands. The lands to be enrolled in this pilot program are those on the coast of the Gulf of Mexico tha were damaged by Hurricane Katrina in 2005. Current Activities: The $794,000 was paid to the Mississippi State University (MSU) Forest and Wildlife Research Center to conduct the project to compare conventional seedlings with seedling grown using new technologies. - Selected Examples of Recent Activity: MSU submitted a progress report to FSA on December 18, 2008. According to the report, the project will be conducted in cooperation with FSA, the USDA Forest Service, and other appropriate entities in the six southern-most counties of Mississippi: George, Hancock, Harrison Jackson, Pearl River, and Stone. The project will replant approximately 350 acres. The seedlings and planting costs will be borne by the project. Landowners will be responsible for preparing the sites so they are ready to plant in the 2008-2009 planting season. Sites will be planted at lower densities (about 100 trees per acre) than traditional plantings. A subset of the plantings will be designated for research purpose and more closely monitored and evaluated over a 2-year period by MSU personnel. Landowners chosen to participate in the demonstration component can select from among a variety of species to be planted. Water oak and Nuttall oak will be replanted in the areas designated for the more intensive research component. The following criteria were used to select participants: • Area must be located in the designated counties. Damage must have been sustained from Hurricane Katrina. Area is or was forested (no agricultural or pasturelands allowed). Site must be ready to plant in the 2008-2009 planting season. Site has a conservation easement, or the landowner is willing to grant limited public access for 10 years. - Area must be reasonably accessible to public roads. Site has an existing management plan. Management history of the site is known. Landowner must allow application of herbicide on the research portion of the site if deemed necessary by project coordinators. • Site must be at least 30 acres. As of the December 18, 2008 report, 17 sites had been selected. An interim report was submitted by MSU on December 31, 2009, and a final evaluation is due December 31, 2010. 65 Z2-48 EMERGENCY CONSERVATION PROGRAM Ppropriations Act, 2010..…........................................................................................ * * * * * * * Audge Estimate, 2011 ..................., - Phange in Appropriation........…....................................................................... we w w a u s a 4. (On basis of appropriation) a • * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * SUMMARY OF INCREASES AND DECREASES 2010 Program 2011 Item of Change Estimated Changes Estimated Emergency cost-sharing to farmers............................ *: * *: PROJECT STATEMENT (On basis of appropriation) 2009 2010 20 l l Project Actual Estimated Change Estimated Šmergency cost-sharing to - armers....................…......... * - tºº -- * * Technical assistance................... * * * * - - - - Total appropriation ................. ww- sº ºn -- -- PROJECT STATEMENT (On basis of available funds) 2009 2010 Increase or 20 ! I Project Actual Estimated Decrease Estimated Emergency cost-sharing to farmers.................................. $151,654,467 $85,500,000 || -$52,030,300 $33,469,700 Technical assistance.................. 1,389,889 9,500,000 –5,781,144 3,718,856 Total available or estimate..... 153,044,356 95,000,000 457,811,444 37,188,556 Unobligated balance brought - - forward from prior years. ...... -285,232,912 -132,188,556 +95,000,000 –37,188,556 Unobligated balance carried . . forward to next year............... 132,188,556 37,188,556 -37,188,556 * - Total appropriation................ * . . . * * * * he Emergency Conservation Program (ECP) was authorized by the Agricultural Credit Act of 1978 (16 .S.C. 2201-05) and was amended in fiscal years 1989 and 1996. For 2009, $66,314 million in ECP nobligated funds from prior years supplemental were made available to the Secretary of Agriculture, until qended, for expenses under this program related to recovery efforts in response to natural disasters, per L. 111-32, signed June 24, 2009. The FY 2011 Budget proposes no funding for this program. he following tables show (a) outlays by type of disaster for fiscal year 2009 and (b) geographic ‘eakdown of obligations for fiscal years 2009-2011. 66 22-49 Emergency Conservation Program Outlays by Type of Disaster Fiscai Year 2009 Adjusted Gross Technical STATE Drought Fíood Hurricane Tornado income All Other Assistance Alabama $2,925 $96,224 $264,764 - Arizona - $2,317 Arkansas 860,129 1,069,669 $1,271,871 California 22,187 {5,580 $1,0; 5,166 1,552,449 Colorado - 277,067 5,209 $71,028 Connecticut 38,498 Florida 37,449 Georgia 1,118,71 122,260 $477,490 1,675,439 13,642 105,262 Hawaii 450,991 157,960 10,572 ldaho 32,977 223,582 | 73 Illinois 3,177,961 33,158 Indiana 35,592 3,424,127 1,950 31,663 Iowa 10,032,315 ł62,724 314,693 57,680 Kansas - 78,671 13,840 739,352 14,545 Kentucky 34t,825 608,307 8,868,858 355,263 Louisiana 2,816,031 - ‘Mathe 9,919 8,376 594 Massachusetts 291,328 Michigan 26,807 ł0, 32 - . Minnesota 987 225,232 - 13,444 Mississippi 499,215 132,940 8,445 Missouri 3,344 5,078,905 106,01 828,491 228,969 267,564 271,915 Montana 1 008,476 7,890 6,600 76,643 21,135 Nebraska 685,912 120,173 181,051 59,322 Nevada 239,563 75,877 - . New Hampshire 22,775 92,436 25,108 483 New Mexico 220,039 5,541 44,128 Wew York - 7,987. 2,938 North Carolina 364,748 1,799 North Dakota 3,648 62,489 - Ohio - 2,780 77,086 40,275 Oklahoma 45,368 1,362,019 88,945 91,831 5,287,185 51,766 Oregon 172,900 97,508 234,993 Pennsylvania 42,477 889 South Carolina 61 1,549 8,792 South Dakota 5,907 645,261 47,242 45,670 Tennessee 584,922 1,510,846 $27,284 Texas 89,825 1,450,098 1,290,31 1,017 Utah 525,846 48,820 48,548 9 : 6 Vermont 7,740 107,297 123,840 232 Virginia 555,563 Washington 891,478 190,556 28,493 Wisconsin 567,798 9,460 Wyoming 10,0] I 42,947 26,926 6,495 Undistributed - 366,987 55, #28 422, Total 5,764,05 28,762,552 5,427,881 6,694,795 1,742,618 21,332, 4 1,389,889 71,083,9 Adjusted Gross Income provisions of the 2007 Act limited payments to producers who earn more than $25 million during 2007 Payments were made to producers for all natural disasters excluding hurricane damages The "All Other" column includes disasters such as high winds, had and ice storms, volcanic conditions and wildfires 67 22-5) Emergency Conservation Program - Geographic Breakdown of Obligations 2009 Actual and Estimated 20 t O and 20 il STATE 2009 Actual 2010 Estimated 2011 Estimated Alabama $353,898 $1,936,737 {} Arizona () -124,742 0. Arkansas 5,116,609 7,828,289 {} California 2,091,620 -542,787 {} Colorado 44,234 -453,962 0. Connecticut {} 48,078 {} Delaware 0. 38,080 0 Florida 61,475 573,787 () Georgia 938,149 4,262,886 0. (Guam - {} : -42,281 0. Hawaii 109,395 -364,836 () !daho 236,247 -750,019 0. Illinois 3,004,147 5,942,061 0 Indiana 6,277,759 10, H&7,091 {} lowa #2,084,045 23,975,667 0 Kansas 178,670 835,444 0. Kentucky 26,356,403 37,933,468 () Louisiana 6,488,571 3,309,929 0. Maine 2, #8 7,957 {} Maryland {} 320,128 0. Massachusetts 970,634 1,294,689 {} Michigan 5,225 43,365 {} Minnesota 281,773 ł61,605 {} Mississippi 6,365,810 3,594,607 Ö Missouri 2,372,189 7,543,069 Ü Montana 492,993 5,058, 197 0 Nebraska 2,573,934 3,317,229 {} Nevada 60,363 207,320 {} New Hampshire 83,555 239,734 6 New Jersey 76,777 76,777 {} New Mexico 86,300 $23,711 0 New York 299,617 1,106,470 0 North Carolina 79,920 2,156,945 0 North Dakota 842,904 1,0}{},824 {} Northern Mariana islands 42,281 42,28i {} Ohio 23,657 -229,970 0 Oklahoma 4,032,483 8,0, 1,066 Q Oregon 459,874 529,328 0 Pennsylvania 8,8}} -226, 1 } l {} Puerto Rico 0 !, ió4,735 O South Carolina 125,92; 1,724.525 0 South Dakota i,836,093 792,799 0. Tennessee 293,936 1,850,542 0 Texas 7,306,745 10,553,118 O Utah 185,467 240,750 {} Venn'ont 59,668 280,539 0. Virginia 232,772 i,581,750 0. Virgin Islands {} $7,388 () Washington 2,350,403 2,179,026 {} West Virginia #68,349 -38,282 0 Wisconsin 587,260 1,439,60] () Wyoming 15t,013 -879,033 {} Undistributed 56,054,400 -64,929,593 $33,469,700 FSA, Subtotal 151,654,467 85,500,000 33,469,700 NRCS, Technical Assistance 1,389,889 9,500,000 3,718,856 Total, Available or Estimate 153,044,356 95,000,000 37, t&8,556 NOTE Negative obligations represent deobligations of pner years' obligations 68 22-51 FARM SERVICE AGENCY Emergency Conservation Program Classification by Obiects 2009 Actual and Estimated 2010 and 2011 Object Class 2009 2010 25 1 Advisory and assistance services $1,389,889 $9,500,000 $3,718,85 41.0 Grants, subsidies, and contributions 151,654,467 85,500,000 33,469,7 99.0 Total direct obligations - 153,044,356 95,000,000 37,188,5 69 22g-14 EMERGENCY CONSERVATION PROGRAM STATUS OF PROGRAM Surrent Activities: During FY 2009, 43 States participated in the Emergency Conservation Program ECP), involving an estimated 2.5 million acres and approximately $71,083,900 in cost-share and echnical assistance outlays, elected Examples of Recent Activity: ECP provisions in prior year supplemental appropriations acts have ırgeted funding for both regular ECP and specific disaster needs, and funds are monitored through eparate Standard General Ledger (SGL) accounts. During FY 2009, $66,314,000 in unobligated funds as internally reallotted from the Hurricane Katrina and Adjusted Gross Income SGL accounts into the gular ECP account to be used for any natural disaster, per P.L. 111-32, signed June 24, 2009. Funds taling $226,681,331 were allocated for the following SGL accounts during FY 2009: Number of ECP Accounts States Allocation Regular ECP 43 $225,952,393 Hurricane Katrina 502,340 ECP Adjusted Gross Income 226,598 TOTAL $226,681,33 l NOTE: Kansas and Southern California received no allocations but had deobligations during FY 2009. - he tables that follow show (a) appropriations and outlays for fiscal years 1981 through 2009 and b) FY 2009 allocations by State. 70 22g-15 Emergency Conservation Program Appropriations and Outlays Fiscal Years 1983 -2009 Fiscal Year Appropriation - Outlays #981 - 89 58,800,000 81,271,444. 1990 29,927,000 1/ 12,256,527 }991 9,999,870 13,245,469 1992 22,500,000 2/ - 8,854,177 ł993 89,667,000 3/ 27,431,669 #994 25,000,000 4/ 34,439,167 $995 23,000,000 5/ - - 27,206,940 i996 30,000,000 6/ , - 25,405,741 iQ97 95,000,000 7/ ,- 31,921,356 #998 34,000,000 8/ 26,458,921 1999 -- 28,000,000 9/ - 40,263,070 2000 - - 60,000,000 10/ 64,985, 108 2001 79,824,000 1 1/ 37,740,788 2002 - - {} 32,365,424 2003 - {} 46,979,673 2004 11,929,200 2/ 23,099,983 2005 150,000,000 13/ 57,123,442 2006 161,800,000 14/ 88,341,155 2007 18,000,000 15/ - 72,165,818 2008 204,413,000 ió/ 27,729,774 2009 0 7/ 71,083,900 TOTAL $1,131,860,070 $850,039,546 NOTE From fiscal years 1957 to 1980, $250 5 million was provided under the Emergency Conservation Measures, authorized by P L 85-88, The Third Supplemental Appropriation Act of 1957. A total of $219 million was outlayed during those years The Emergency Conservation Program (ECP) was established by Title IV of the Agricultural Credit Act of 1978, P L 95-334 l/ includes $10 million through a direct ECP appropriation and $40 million transferred from the former SCS per the Dire Emergency Supplemental Appropriation Act, P L 101-302 2/ Excludes $10.5 million in contingency funds provided by P L 102-368, which was made available on December 30, 1992 3/ Includes $10.5 million in contingency funds provided by P L iO2-368, which was made available on December 30, 1992, $31 367 million transferred from CRP under the authority of 7 USC 2257, $30 million provided by the FY 1993 Midwest Flood Supplemental, $14.8 million transferred from the former FmHA, an $3 million provided by P L 102-341 - 4f $25 million in supplemental funding was provided by P L 103-21 l 5/ Provided in the FY 1995 Agriculture Appropriations Act by transfer from the NRCS 6/ $30 million in supplemental funding was provided by P L 104-134 7/ $25 million in supplemental funding was provided by P L 104-208, and $70 million in supplemental funding was provided by P L 105-18 8/ $34 million in supplemental funding was provided by P L 105-174, which included $4 million for taps and tubing for maple producers - - 9/ $28 million in supplemental funding was provided by P L 106-31 10/ $50 million in supplemental funding was provided by P L 106-113, and $10 million in supplemental funding was provided by P L 106-246 for the Los Alamos Fire in New Mexico 11t $80 million in supplemental funding was provided by P L 106-387, and $176 thousand was rescinded under P L, i O6-554, - 12/ $11.9 million in supplemental funding was provided by P L 108-199 for southern California. t3/ $150 million in supplemental funding was provided by P L 108-324, including $50 million in CCC funding 14/ $199.8 million in supplemental funding was provided by P L 109-148 $38 million was transferred to NOA by P L 109-234 - 15ſ $18 milion in supplemental funding was provided by P L | 10-28, $2 million was for Kansas only 16/ $89 413 million in supplemental funding was provided by P L 110-252, $115 million in a second suppleme was provided by P L 10-329 - 17/ $66 314 million was internally reallotted from the Hurricane Katrina and Adjusted Gross income SGL accounts into the regular ECP account to be used for any natural disaster, per P L 11-32, signed June 24, 2009 71 22g-i6 EMERGENCY CONSERVATION PROGRAM FY 2009 Allocations by State State Disaster Total Allocations Alabama Flood/Tornado $2,416,006 Arkansas Flood/Ice Storm/Tornado 17,028,000 California Drought/Wildfire/Wind 500,391 Colorado Flood 157,000 Connecticut Technical Assistant Payment 89,761 Florida Flood/Hurricane 755,340 Georgia Drought/Flood/Hurrricane/Tornado/Storm 5,810,000 Hawaii Flood/Volcanic Conditions 1,597,000 Idaho Flood 22,000 Illinois Flood 724,188 Indiana Flood/Hurricane 13,256,287 Iowa Flood/Tornado 20,109,538 Kansas Flood/Ice Storm/Tornado/Wildfire 1, 195,067 Kentucky Drought/Ice Storm 57,739,000 Louisiana Hurricane 16,000,000 Maine Flood/Ice Storm 90,000 Massachusetts Ice Storm 2,867,000 Michigan Drought 64,350 Minnesota Fiodo 305,000 Mississippi Ice Storm/Tornado 516,000 Missouri Flood/Hurricane/Ice Storm/Tornado 6,748,413 Montana Drought/Flood/Wildfire 1,192,000 Nebraska Flood/Hurricane/Storm/Tornado 4,408,000 Nevada Drought/Wildfire/Tornado 601,701 New Hamsphire Hurricane/Ice Storm/Wildfire 360,000 |New Mexico Flood/Wildfire 2,993,000 New York Flood 125,000 North Carolina Drought/Tornado 50,000 North Dakota Drought/Flood 5,701,395 Ohio Hurricane 375,000 Oklahoma Flood/Ice Storm/Wildfire 3,281,000 Oregon Ice Storm 2,429,000 Pennsylvania Fiocci 70,894 Rhode Island Fiood - 1,000 South Carolina Drought/Tornado 117,000 South Dakota Fiocci 1,244,080 Tennessee Flood/Ice Storm/Tornado 5,967,000 Texas Hurricane/IceStorm/Wildfire 45,213,000 Utah Drought/Flood 491,000 Vermont Ice Storm/Tornado 394,000 Virginia Drought 338,000 Washington Drought/Flood/Wildfire/Wind 2,188,000 Wyoming Flood/Tornado 416,000 Subtotal 225,916,41 I Reserve for Environmental Studies and Forest Service 764,920 Total $226,681,331 72 22-52 AGRICULTURAL DISASTER RELIEF FUND Appropriation, Special Fund, 2010......................................................................................... ...s/56,000,000 Estimated Appropriation, Special Fund, 2011 .............................................................................. 891,000,000 Increase in Appropriation, Special Fund....................... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . +135,000,000 SUMMARY OF INCREASES AND DECREASES (On basis of appropriation) - 2010 Program 201 Item of Change Estimated Changes Estimated Disaster Payments.…. ----------. $756,000,000 +$135,000,000 $891,000,000 PROJECT STATEMENT (On basis of appropriation) 2009 2010 - 20 ! : Project Actual Estimated Increase Estimated Disaster payments..................... $703,000,000 $756,000,000 | +$135,000,000 $891,000,000 Total appropriation.… 703,000,000 756,000,000 | +135,000,000 | 891,000,000 PROJECT STATEMENT (On basis of available funds) 2005 2010 Increase or 20 1 Project Actual Estimated Decrease Estimated Disaster payments...................... $6,000,000 $1,525,000,000 -$127,000,000 $1,398,000,000 Recovery Act disaster - payments.................................... 0 230,000,000 -230,000,000 0 Unobligated balance brought - - forward from prior years ............ -833,000,000 -1,530,000,000 +999,000,000 -531,000,000 Unobligated balance carried w forward to next year................... +1,530,000,000 +531,000,000 -507,000,000 +24,000,000 Total appropriation.................... 703,000,000 756,000,000 135,000,000 891,000,000 - Classification by Objects 2009 Actual and Estimated 2010 and 2011 Object Class 2009 2010 2011 4}.0 Grants, subsidies, and contributions $6,000,000 $1,755,000,000 $1,398,000,000 6,000,000 1,755,000,000 Total direct obligations 1,398,000,000 73 22-53 FARM SERVICE AGENCY Agriculture Disaster Assistance Transition Agriculture Disaster Relief SUMMARY OF RECOVERY ACT FUNDING Program/Project/Activity 2009 2010 201 || 2008 Agriculture Disaster Transition (estimated program level) 0 $230,000,000 0 Project Statement- Recovery Act (On basis of available funds) 2009 2010 Increase or 20 i 1 º Project Actual Estimated Decrease Estimated Assistance to producers for crop "- losses due to natural disasters 0 $230,000,000 -$230,000,000 0 Total, available or estimate......., 0 $230,000,000 -$230,000,000 {} oals and Coordination Efforts: oordination efforts rely on providing daily and weekly reports to the agency regarding accomplishments nd expected goals for the next 30–60 days. Success also involves the interaction from other agencies uch as the Risk Management Agency and our ability to use data provided by them. bjectives: he Supplemental Revenue Assistance Payments (SURE) Program was authorized in Sections 12033 and 5001 of the Food, Conservation, and Energy Act of 2008, P. L. 110-246, enacted June 18, 2008. The bjective is to provide financial assistance to producers for crop production and quality losses due to atural disasters. To be eligible for the SURE program, producers must have at least the catastrophic level CAT) of Federal crop insurance for all insurable crops, and/or coverage for non-insurable crops under the on-insured Crop Disaster Assistance Program (NAP). The sales closing dates for CAT and application losing dates for NAP have passed for the 2008 crop year for all insurable and non-insurable crops. The URE is available for the 2008 crop year through September 30, 2011. The American Recovery and reinvestment Act of 2009 authorized these changes: - Provided a waiver for producers that did not obtain CAT or NAP, through a buy-in fee before May 18, 2009, to maintain 2008 SURE eligibility, Increased minimum coverage level for SURE guarantees (70/100 for those producers who buy in under this extended authority, up from the previous 50/55 for CAT and 50/100 for NAP). Allowed previously eligible SURE producers benefits based on the greater of the increased 70/100 level or a 5 percent increase in payment factor calculation for SURE guarantees. This increased insured crops from 115 percent to 120 percent and NAP crops from 120 percent to 125 percent. Provided a risk management requirement that new eligible producers purchase at least 70/100 crop coverage for the next available year that crop insurance is available, or obtain NAP coverage. 74 22-54 Delivery Schedule: Implementation Phases 1. FY 2009 Accomplishments • Calculate quality in determining 10% and 50% loss threshold The first phase consists of developing program policy and procedure, including compliance with the Recovery Act accountability and transparency requirements. Completed milestones include: Developed a matrix of outstanding program issues. - Announced the extended deadline for accepting buy-in waivers to become eligible for SURE. Provided instruction to State and county offices for accepting the additional buy-in fees. Ensured compliance with Recovery Act requirements. Resolved outstanding program issues. Published regulations for SURE program. Developed handbook procedures on new eligibility and policy for revised SURE guarantee calculations. º The first phase was completed January 4, 2010, The second phase, software development, consists of the following completed milestones: . • Developed automated buy-in process for buy-in provision. - * - | • Developed requirement for RMA data download. - • Developed Excel SURE Workbook for calculating SURE payments. • Developed payment software process. --- - The second phase is split into two major functions: application software and payment software. The first major function is the actual SURE application workbook process, and it was completed January 2010. The second major function is payment software, and it was also completed January 4, 2010. Note: The agency is in the process of expediting activities and resources associated to these function: in an attempt to cut completion dates. - The third phase, updating the SURE calculation workbook for the full-blown SURE process, consists of the following milestones: - • Develop yield software for calculating adjusted approved yield. • Update SURE workbook to take into consideration CCC yield comparison, adjusted approved yield adjustments for NAP. The fourth phase, program signup, consists of the following completed milestones: • Received data downloads from RMA for the calculation of guarantees for insurable crops and internal data for NAP crops. • Announced signup dates for accepting SURE applications. • Began signup January 4, 2010. Process Payment Applications - • Run payment processes based on completed and approved SURE applications. • Finalized policy decisions. • Drafted 1-SURE Handbook. • Provided national training both in person for State office trainers and a 2-day webinar session fol both State and county offices. - • Finalized draft version of the SURE regulation. 75 22-55 FY 2010 Planned Accomplishments Completed in FY 2010: Received RMA download of RMA data and FSA data. Finalized Excel Workbook for calculating SURE Interim payments ready for signup January 4, 2010. Released buy-in software for taking automated buy-in fees. Published SURE regulation in Federal Register December 28, 2009. Released press releases and SURE fact sheets announcing SURE signup. Began 2008. SURE signup January 4, 2010. Began issuing 2008 SURE payments January 4, 2010. Planned Accomplishments Continue to take 2008 SURE applications. Continue to approve and make SURE payments. Y 2011 Planned Accomplishments Finalize any carry-over SURE applications for which estimated obligations were made by September 30, 2010. - 76 22-56 FARM SERVICE AGENCY Agricultural Disaster Relief Trust Fund Geographic Breakdown of Obligations 2009 Actual and Estimated 2010 and 2011 STATE 2009 Actual 2010 Estimated 201 Estimated Alabama 0 $963,120 0 Alaska {} 1,368 0 Arizona {} 157,384 {} Arkansas {} 1,338,945 {} California Ö 2,468,540 () Colorado 0 5,393,649 () Connecticut {} 137,595 {} Delaware 0 535,680 0 Florida {} 536,546 {} Georgia 0 3,087,885 {} Hawaii {} 70,426 {} Idaho {} 1,717,898 {} łllinois {} 9,297,928 0 Indiana 0 7,233,377 () Iowa {} 20,874,047 0 Kansas {} 14,592,637 0. Kentucky {} 2, 193,432 0 Louisiana G 2,589,210 0 Maine {} 130,778 0 Maryland 0 965,591 0 Massachusetts {} 194,430 0 Michigan {} 3,014,470 {} Minnesota 6 20,981,249 0 Mississippi {} 1,996,390 0 Missouri 0 8,604,383 0 Montana 0. 4,854,364 {} Nebraska 0 11,972,337 () Nevada 0 14,217 0 New Hamsphire 0. 34,791 0 New Jersery {} 106,438 {} |New Mexico {j 785,754 {} New York (; 641,479 () North Carolina {} 6,252,898 0. North Dakota {} 28,455,311 () Ohio {} 10,159,695 {} Oklahoma 0 3,177,977 0 Oregon {} 1,393,047 Q Pennsylvania 0 907,764 () Rhode Island {} 1,378 {} south Carolina {} 1,604,034 () South Dakota {} 12,229,506 {} Tennessee {} 1,644,112 {} Texas 0 26,028,904 {} Utah {} 120,459 () Vermont {} 45,766 {} Virginia O 1,660,082 () Washington 0 2,569,955 0 West Virginia {} 28,337 () Wisconsin 0 5,939,557 {} Wyoming () 294,880 0 Total, Available or Estimate {} 230,000,000 0 77 22g-17 AGRICULTURAL DISASTER RELIEF TRUST FUND STATUS OF PROGRAM Current Activities: The Food, Conservation, and Energy Act of 2008, P.L. 110-246, provides for Supplemental Agricultural Disaster Assistance under Sections 12033 and 1500i. This includes the Agricultural Disaster Relief Trust Fund, which is composed of amounts equivalent to 3.08 percent of the amounts received in the general fund of the U.S. Treasury during FY 2008-2011 “attributable to the duties collected on articles entered, or withdrawn from warehouse, for consumption under the Harmonized Tariff Schedule of the United States.” The fund has authority to borrow, and repayable advances that are “such ums as may be necessary” make up the fund’s budget authority. Advances to the fund must be repaid with interest to the general fund of the U.S. Treasury when the Secretary of the Treasury determines that funds e available in the trust fund. Funds from the trust fund may be used to make payments to farmers and ranchers under the following five new disaster assistance programs: Supplemental Revenue Assistance Payments (SURE) Program; Livestock Forage Disaster Program (LFP); Livestock Indemnity Program (LIP); Tree Assistance Program (TAP); and Emergency Assistance for Livestock, Honey Bees, and Farm-Raised Fish (EALHF) Program. P.L. 110-246 provides that participants in the new disaster assistance programs are required to have crop insurance or non-insured crop disaster assistance, or to pay a fee if they are otherwise ineligible. Of the programs under the trust fund, only LIP had program activity during FY 2009; obligations of $5,763,693 were incurred, of which $2,946,799 was outlayed. In FY 2009, the amount of customs receipts credited to the Agricultural Disaster Relief Trust Fund receipt account totaled $703,438,297, Available budget authority totaling $1,530,625,668 was carried forward into FY 2010 as an unobligated balance. 78 USDA SUPPLEMENTAL ASSISTANCE Appropriations Act, 2010.................... 22-57 * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * $295,600,000 Budget Estimate, 2011 …............…............…...................................................... 0 Change in Appropriation -295,600,000 SUMMARY OF INCREASES AND DECREASEs (On basis of appropriation) 2010 Program 2011 Item of Change Estimated Changes Estimated Payments to farmers and ranchers for losses because of natural disasters....... $295,600,000 -$295,600,000 0 PROJECT STATEMENT (On basis of appropriation) - 2009 , 2010 201 i Project Actual Estimated Change Estimated Payments to farmers and ranchers for losses because of natural disasters..........., 0 $295,600,000 -$295,600,000 () Total appropriation ........ * * * * * * * * w = < * * * * * * * * * • 0 $295,600,000 -$295,600,000 0 PROJECT STATEMENT (On basis of available funds) 2009 2010 increase or 20 | } Project Actual Estimated Decrease Estimated Payments to farmers and ranchers for losses because of natural disasters........................................... $83,813,724 $295,600,000 -$295,600,000 () Unobligated balance brought forward from prior years................... -860,266,816 -776,453,092 +776,453,092 {} Unobligated balance carried - - forward to next year.......................... 776,453,092 +776,453,092 –776,453,092 Total appropriation.* * * * r * * * * * * * g g sº a w w - sº e s tº º w = < () 295,600,000 -295,600,000 classification by Objects 2009 Actual and Estimated 2010 and 2011 Object Class 2009 2010 2011 41.0 Grants, subsidies, and contributions $83,813,724 $295,600,000 0 Total direct obligations 83,813,724 295,600,000 {} 79 - 22g-18 USDA SUPPLEMENTAL ASSISTANCE PROGRAM STATUS OF program - Current Activities: The Agricultural Assistance Act of 2007, enacted as Title IX of P.L. 110-28, the U.S. Troop Readiness, Veterans’ Care, Katrina Recovery, and Iraq Accountability Appropriations Act, 2007, appropriated approximately $2.8 billion for disaster assistance for farmers and ranchers. Under this title, appropriations are provided for the Crop Disaster Program, Livestock Compensation Program, Livestock Indemnity Program, Emergency Conservation Program (ECP), and Dairy Disaster Assistance Program. With the exception of the ECP, these programs are of the type historically funded by the CCC. Funding will remain available until expended. The FY 2008 Consolidated Appropriations Act, P.L. 110-161, provided an additional $602 million under Sec. 743, which extends the period of loss eligibility for disaster assistance from February 28, 2007, to December 3i, 2007. - Selected Examples of Recent Activity: The following table shows outlays for FY 2009 by program. USDA Supplemental Assistance Program Outlays by Program Fiscal Year 2009 Programs Allocations Crop Disaster Assistance - 2007 $114,562,916 Livestock Compensation Program - 2007 2,042,744 Livestock Indemnity Payments - 2007 1,692,629 Dairy Disaster Assistance 150,708 Adjustment -148,850 TOTAL - - $118,300,147 P.L. 110-28 provided $18 million for the ECP, including $2 million earmarked for Kansas. The status of hose funds is included in the ECP section of these Explanatory Notes. 80 22-58 FARM SERVICE AGENCY Aquaculture Assistance SUMMARY OF RECOVERY ACT FUNDING Program/Project/Activity 2009 - 2010 20 i ! Aquaculture Assistance Grants $50,000,000 0 0. Project Statement-Recoveryv Act (On basis of available funds) - - 2009 20 i () Increase or 2011 Project , Actual Estimated Decrease Estimated Grants to States for programs to assist - - aquaculture producers................................ $48,500,000 $1,500,000 -$1,500,000 0 Unobligated balance brought forward - - . from prior year.......................................... 0 -1,500,000 1,500,0000 {} Unobligated balance carried forward to - - next year ................................................... 1,500,000 0 0. Ö Total appropriation.…..................: 50,000,000 0 0 0 Program Implementation Activities: Objective: The 2008 Aquaculture Grant Program (AGP) objective is to provide block grants to State departments of agriculture that agree to provide assistance to eligible aquaculture producers for losses associated with high feed input costs during the 2008 calendar year. This objective aligns with the Agency’s Goal 1, Supporting Productive Farms and Ranches, Objective 1.1, Improving Access to Capital, Delivery Schedule: Implementation Phases l, Development of Program Policy and Procedure – This phase consists of developing program policy and procedure, including compliance with the Recovery Act accountability and transparency requirements. This phase consists of the following completed milestones: • Developed a matrix of outstanding program issues. ... - • Drafted a Memorandum of Understanding (MOU) to be executed between CCC and the States. • Drafted a letter to the States announcing availability of funding and requesting 2007 feed delivery data. - • Provided a draft MOU for States to provide FSA comments on program provisions and implementation, - Ensured compliance with Recovery Act requirements including standard language for grants Resolved outstanding program issues. Finalized program announcement letter to the States announcing availability of funding. finalized draft MOU to be included in announcement letter to the States. The first phase was completed in early April 2009. 2. Program Announcement – This phase consists of the following completed milestones: • Provided the States a program announcement letter to announce availability of funding. • Requested 2007 feed delivery data required for FSA to allocate grant funding to the States. • Included a draft MOU so that States could provide FSA comments on program provisions and implementation. 81 22-59 The second phase was completed in mid April 2009. 3. Collecting Data and Program Comments – This phase consists of the following completed milestones: . • Received 2007 feed data from participating States. • Determined grant amount for each State. • Reviewed comments submitted by States. • Revised and finalized MOU as needed. The third phase was completed in May 2009. 4. Grant Agreement Execution – This phase consists of the following milestones: • Execute MOU’s between CCC and the States, including the collection of required grant forms and certifications. • Receive and approve work plans submitted by the States. The fourth phase was completed in December 2009 except for Alaska. 5. Grant Approval – This phase will consist of the following planned milestones: • Receive and approve work plans submitted by the States. • Transfer grant funding to the States. - The fifth phase is estimated to be completed on or before January 31, 2010. Performance Measures: - Performance Data Performance Measures 2009 Actual || 2010 Target 2011 Target Number of States receiving assistance 37 2 Number of aquaculture species receiving assistance 17 TBD FY 2009 Accomplishments: - - As of September 31, 2009, all 37 participating States executed a grant agreement with CCC, and CCC obligated $48.5 million in grant funding to the States. FSA approved 34 State work plans and disbursed $47.6 million to the States. - Planned Activities: FY 2010; • Execute a grant agreement with Alaska, • Collect back unused grant funding from participating States. • Reallocate unused grant funding to States that had to apply a State factor to AGP payments because benefits requested in the State exceeded the State's grant amount. • Collect and review results of States’ internal reviews. - • Ensure States are compliant with Federal reporting requirements under Section 1512 of the Recovery Act. - FY 201 i : Funding is only available through September 31, 2010; therefore, there are no planned activities for FY 2011. 82 22-60 FARM SERVICE AGENCY Aquaculture Grant Program Geographic Breakdown of Obligations 2009 Actual and Estimated 2010 and 201 i 2010 Estimated STATE 2009 Actual 2011 Estimated Alabama $10,027,066 () 0 Alaska 0 $150,000 0 Arkansas 7,814,413 0 () £alifornia 1,107,872 0. 0 Colorado 46,412 0 0. Delaware 17,936 0 {} Florida 341,742 0 0 Georgia 205, H61 0 0 Hawaii #50,498 0 0 Idaho 1,252,305 0 0 Illinois 77,140 0 () Kentucky 53,251 0 0 Louisiana 2,412,106 0 () Maine 829,764 () {} Massachusetts 56,989 0. 0 Michigan 22,294 0 0 Minnesota 69,481 0 0 Mississippi 19,626,815 0 0 Missouri 109,921 0 0. Nebraska 25,531 0. {} New Hampshire 2,554 0. 0 New Jersey 3,790 O 0 New Mexico 5,836 0 O New York " 56,762 {} 0 North Carolina 797,622 0 0. Ohio 63, 190. 0. 0. Oklahoma 91, 183 () 0. Oregon 15,820 0 0 Pennsylvania 182,001 0 {} South Carolina 72,946 0 0. South Dakota 5,082 0 0 Tennessee 55,257 0 0. Texas 1,686,883 0 0. Utah 6,793 0 0. Virginia 251,185 0 0. Washington 925,142 0 () Wisconsin 27, 173 0. 0. Wyoming 4,084 {} 0 Undistributed . 0 1,350,000 0 Total, Available or Estimate 48,500,000 1,500,000 O 83 22-61 FARM SERVICE AGENCY Summary of Budget and Performance Statement of Department Goals and Objectives The Farm Service Agency (FSA) was established October 13, 1994, pursuant to the Department of Agriculture Reorganization Act of 1994, P.L. 103-354. FSA’s mission is to equitably serve all farmers, ranchers, and agricultural partners by delivering effective, efficient, agricultural programs for all Americans. FSA has three strategic goals and seven strategic objectives that contribute to two of the Department's strategic goals and two of the High Priority Performance Goals (HPPG's). USDA Agency Agency & Key Strategic Goal | Strategic Goal Objectives Programs that Contribute Outcomes USDA Goal: Agency Goal 1: Objective 1.1; Direct and Guaranteed Farm Agency Key USDA will Supporting Improving Loans Outcomes: assist rural productive a CCCSS to All programs except conservation communities to farms and capital loan programs Successful Create ranches farms and prosperity so Objective l.2: Income Support and Disaster ranches they are self- Agency Goal 2: Mitigating Assistance sustaining, Supporting market losses || All programs, including Market based repopulating, secure and Supplemental Revenue Assistance agriculture and affordable food Objective 1,3: Payments Program economically and fiber Mitigating Thriving thriving losses from All ad hoc disaster assistance agricultural natural programs communities disasters * - - - - Conservation Affordable Qbjective.2.1; Biomass Crop Assistance Program | food and fiber Providing Emergency Conservation Program - adequate, Secure supply ****** Commodity Operations of food and capacity that | U.S. Warehouse Act. Licensing fiber maintains and Enforcement quality Effective food Dairy Product Price Support Program (formerly Milk Price Support Purchases) CCC Inventory Management Operations ELS Cotton Competitiveness Program Canadian End Use Wheat Program Domestic and Foreign Food Assistance Purchases aid 84 22-62 USDA Agency Agency Ke Strategic Goal | Strategic Goal Objectives Programs that Contribute oºie USDA Goal: Agency Goal 3: Objective 3.1: Conservation Reserve Program Agency Key USDA will Conserving Improving Outcome: ensure our natural - conservation Conservation Reserve national forests resources and practices Enhancement Program Quality soil and private enhancing the - working lands environment Objective 3.2: Source Water Protection Program | Quality water are conserved, - Targeting restored, and lands to - Quality made more maximize - wildlife resilient to “s conservation habitat climate change, benefits while - enhancing our Objective 3.3: Water reSQurces - Mitigating 3. adverse impacts from agricultural production Key Outcomes: Agency Strategic Goal 1 - Supporting Productive Farms and Ranches • Successful Farms and Ranches • Market Based Agriculture • Thriving Agricultural Communities HPPG Measure: FSA programs contribute significantly to the rural and farm economy in terms of prosperity creation/preservation and in job creation/retention. FSA programs also directly contribute to increased lending and renewable energy options and positively impact on food processing and distribution systems, Research is needed to develop metrics that account for these contributions in concert with other USDA and Federal partners. Long-term Performance Measures. - • Maintain or reduce average processing time for direct loans. • Maintain or reduce average processing time for guaranteed loans • Maintain or increase percentage of program benefits delivered through a Web environment • Increase the percentage of loans made to beginning farmers, racial and ethnic minority farmers, and women farmers financed by FSA - Selected Past Accomplishments toward Achievement of Key Outcomes Farm Loan Programs. FSA has made significant progress in expanding credit access to beginning farmers, minorities, and women. Lending to these groups has increased by more than 80 percent since FY 2000 ($995 million) to more than $1.8 billion in FY 2009. In FY 2009, FSA made over 18,000 loans to beginning farmers, minorities and women. USDA currently has 47,503 minority, women, and beginning farmers in its loan portfolio. - . FSA experienced significant increases in demand for its farm loan programs in FY 2009. A total of 34,210 loans was made, compared to 26,305 in FY 2008. This surge in demand is due in part to more scrutiny being placed on mortgage loans by commercial lenders and the instability in the credit market, FSA was able to meet the increased demand in part because of additional funding for the Direct Operating Loan 85 22-63 rogram provided through the American Reinvestment and Recovery Act. USDA funded an additional ,600 operating loans through the Recovery Act in FY 2009, Nearly 64 percent of these loans were issued beginning and socially disadvantaged farmers. - SA’s loss and delinquency rates remain at historic low levels for both the direct and guaranteed loan rograms. In the direct loan program, the loss rate in FY 2009 was 0.8 percent and the delinquency rate was 6.3 percent. The guaranteed loan program had a loss rate of 0.39 percent in FY 2009 and a lelinquency rate of 1.69 percent. These results can be attributed to numerous factors, including ongoing ystems modernization efforts and streamlining of program regulations resulting in more efficient perations that enable FSA to better service loans. FSA has also continued to significantly reduce the loan rocessing times for the direct and guaranteed loan programs. - come Support and Disaster Assistance, FSA helps farmers manage market risk primarily through income upport and disaster assistance programs. These programs help farmers and ranchers to address major uctuations in market conditions and unexpected natural or man-made disasters. These efforts contribute productive farms and ranches, thriving agricultural communities, market-based agriculture and secure nd affordable food and fiber, he Non-Insured Crop Disaster Assistance Program (NAP) provides a risk management tool for producers f non-insurable crops. In 2009, NAP enrollment was up, in part because of the passage of the Food, onservation, and Energy Act of 2008, which requires participation in NAP or purchase of crop insurance n order to gain eligibility for USDA permanent disaster programs, including the Supplemental Revenue ssistance Payments Program, Livestock Forage Disaster Program, Emergency Assistance for Livestock, oney Bees, and Farm-Raised Fish Program, and the Tree Assistance Program. ther support to farmers and ranchers is provided by Farm Storage Facility Loans (FSFL’s), which have een increasing in number each of the last 4 years and are expected to continue increasing. During fiscal ears 2000-2009, over 21,000 FSFL's were disbursed. The 2008 Farm Bill added hay and renewable iomass as eligible commodities. And using the discretionary authority given the Secretary in August 009, cold storage facilities for fruits and vegetables are also added. The FSFL program has provided inancing for on-farm storage for over 624 million bushels of eligible commodities since FY 2000. FSFL pplications have increased from 1,717 in FY 2005 to 3,314 in FY 2009, an increase of 1,597. In FY 2006, e Commodity Credit Corporation made available nearly $100 million in FSFL's, while in FY 2009 the mount obligated for loans exceeded $184 million. - - he Direct and Counter-Cyclical Payment Program (DCP) is a key factor in the agency’s effort to mitigate arket losses. This program provides more than $5 billion annually in direct payments. Counter-cyclical ayments vary as market prices change, providing as much as $2.5 billion in a single year to mitigate arket losses. To increase customer satisfaction and reduce the time spent visiting a USDA Service Senter, the Agency implemented a Web-based platform to deliver the DCP and the electronic Loan beficiency Payment Program (eLDP). - FSA's electronic DCP service allows agricultural producers to enroll in DCP online. Producers can choose DCP payment options, assign crop shares, and sign, view, print and submit their DCP contracts from any :omputer with Internet access at any time. This service is available to all eligible producers and helps the Agency maintain a 97.5 percent participation rate for this program The LDP program distributed approximately 98 percent of FY 2009 LDP benefits electronically. In ddition to eLDPs, producers who received cotton Marketing Assistance Loans (MALS) can repay jutstanding loans electronically through the use of the Centralized Cotton Redemption (CCR) process. The CCR systems perform all calculation, collection and release functions for cotton pledged as collateral, which simplifies the cotton repayment process tremendously. In FY 2009, 2,391,865 bales of cotton were edeemed using CCR for approximately $421,819,640 million. - 86 - 22-64 The Milk Income Loss Contract Program (MILC) program is a cyclical program that compensates dairy producers when the price for Class 1 milk in the northeast falls below a specified level. Due to declining milk prices that have been the lowest in recent history, there has been a payment rate in effect under the MILC program for the entire 2009 fiscal year. The MILC application and payment processing software was released nationwide to State and county offices February 2, 2009. Approximately 97 percent of MIL payments issued to eligible producers were made electronically during FY 2009, FSA expects to meet thi 97 percent mark for FY 2010. As of December 15, 2009, approximately $825,067,030 has been disbursed for FY 2009 and $52,278,060 has been issued for FY 2010 using MILC software. | Farmland restored by the Emergency Conservation Program (ECP) ensures continued production capabilities and protection of soil, water, air, and wildlife environmental resources. In FY 2009, ECP successfully rehabilitated 2.5 million acres of farmland that had been damaged by natural disasters. Selected Accomplishments Expected at the FY 2011 Proposed Resource Level: Farm Loans. FSA expects to meet its FY 2011 farm loan program goals for increased lending to women, minority, and beginning farmers and improved timeliness of loan application processing. Proposed FY 2011 funding will allow FSA to provide agricultural credit through its direct and guaranteed loan programs to approximately 30,000 family farmers. In addition, FSA continues to improve the operational effectiveness and efficiency of its farm loan programs through information system enhancements: • Additional capabilities will be added to the Farm Business Plan management information system, which will increase the operational, reporting, and analytical capabilities for the direct loan program. • FSA is transitioning all direct loan servicing information technology applications into a single, web- based application. In addition to moving direct loan servicing to a modern platform, the system will expand on existing capabilities to include all special servicing options. Implementation of the direct loan servicing system will allow FSA to better service its delinquent and financially distressed borrowers. • Guaranteed Loan System enhancements will improve the user interface, resulting in productivity increases. • The Farm Loan Programs Data Mart is under development. The Data Mart will house data for all of th farm loan program systems. Once completed, the Data Mart will significantly enhance data usefulness resulting in improved reporting and analytical capabilities. Income Support & Disaster Assistance. The Farm Storage Facility Loan Program (FSFL) expects growing program interest in FY 2011 due to the addition of hay and renewable biomass as eligible commodities under the Food, Conservation and Energy Act of 2008, and cold storage facilities for fruits and vegetables. To this end, FSA will expand outreach efforts for farm storage facility loans to eligible biomass, fruit and nut and vegetable producers. Producers, who must store their grain and renewable biomass commodities. before delivery to ethanol and bio-fuel plants are using FSFLs to construct much of the on-farm storage they need. Fruit and vegetable producers will be constructing cold storage facilities to help preserve and extend the life of their harvested commodities from harvest until the commodity is sold. FSA will expand protection opportunities for producers through ACRE, through which producers may receive revenue-based payments as an alternative to price-based counter-cyclical payments. FSA will continue the use of the Geographic Information System (GIS). This system gathers pertinent | information such as weather data, crop data, and satellite and aerial imagery to assess areas damaged by natural disasters, analyze potential loss, and speed delivery of disaster payments, The Marketing Assistance Loan (MAL) and Loan Deficiency Payment (LDP) programs expect lower than average producer participation due to high prices and strong market conditions for most of the eligible lo commodities. The MAL program will continue to provide producers of eligible loan commodities with interim financial assistance at harvest, when prices are usually lower than at other times of the year. Corn 87 22-65 prices are expected to increase to an average $3.90 per bushel for the 2010/11 marketing year compared with $3.55 per bushel for the 2009/10 marketing year and well above the national average loan rate of $1.95 per bushel for both years. Soybean prices are expected to average $9.00 per bushel for the 2010/11 marketing year compared with $9.25 per bushel for 2009/10, but significantly above the national average loan rate of $5.00 per bushel for both years. The Biomass Crop Assistance Program (BCAP), authorized in the 2008 Farm Bill, will provide financial assistance to producers or entities that deliver eligible biomass material to designated biomass conversion facilities for use as heat, power, bio-based products or bio-fuels. This program includes: • Collection, Harvest, Storage and Transportation (CHST): assistance for agriculture and forest land owners and operators with collection, harvest, storage, and transport of eligible biomass for use in biomass conversion facilities. The FY 2010 Presidents budget included $280 million for CHST payments, which covered 6-8 million tons of eligible biomass. • Project Areas: financial and technical assistance for establishing and producing eligible crops for the conversion to bio-energy through project areas and through contracts on land of up to 5 years for non- woody crops or up to 15 years for woody biomass crops. Contracts will include crop establishment and annual payments. The FY 2010 President’s Budget included $87million for project areas. Initial assistance will be for the CHST costs associated with the delivery of eligible materials. The first CHST payments were made in late 2009. FSA expects to fully implement the BCAP in FY 2010. Information Technology: FSA will continue to expand efforts to publicize available program benefits to all eligible producers and ork to improve access to information through use of Web pages as well as media mailing, FSA Service Center newsletters, and producer informational meetings. FSA will proceed with the Modernize and Innovate the Delivery of Agricultural Systems (MIDAS) project. This initiative is intended to construct automation systems to provide online services for customers to apply for farm programs and conduct electronic business. FSA expects improvements in these online services fter the internal processes are fully automated and delivered in MIDAS. FSA will support the automation ystems required to enable timely delivery and accountability for the farm program benefits to customers. FSA will also conduct a migration of farm program applications from an obsolete legacy environment to minimize the increasing risk of failure to deliver basic services. hrough the FSA Budget and Performance Management System work is under way to establish an integrated activity-based costing (ABC) system. The ABC system will allow the agency to develop cost- based performance measures that will be valid, reliable indicators of the efficiency of FSA programs. This information will be used to monitor and evaluate the cost of administering these programs. The ABC system is scheduled for implementation in the second quarter of FY 2010. • Reduce average processing time for direct loans • Reduce average processing time for guaranteed loans. 88 22-66 Key Outcomes: Agency Strategic Goal 2 - Secure and Affordable Food and Fiber • Supporting adequate, Secure storage capacity that maintains quality • Improving purchase and delivery of food aid HPPG Measure: FSA commodity programs contribute significantly to the availability of safe and nutritious domestic and foreign food aid, including the National School Lunch Program. Research is needed to develop metrics that account for FSA’s contributions to this goal, in concert with other USDA and Federal partners. Long-term Performance Measure - - . • Reduce or maintain average time between warehouse examinations Selected Past Accomplishments toward Achievement of Key Outcomes: To ensure the safety of food stored in warehouse facilities, FSA inspects storage facilities and tracks the number of days between warehouse examinations. The FY 2009 performance of 363 days between warehouse examinations surpassed the target of 400 days, due, in part, to efficient examination practices and time savings through the use of electronic warehouse receipts. The warehouse examination program performs examinations of warehouse facilities that store or handle commodities for the public and CCC. Warehouses are examined by FSA warehouse examiners for compliance with CCC storage agreements and United States Warehouse Act (USWA) licensing agreements. Increased frequency provides the opportunity to discover potential loss due to theft, pest infestation, or deterioration of quality for commodities in store. Factors affecting the time between warehouse examinations include the number of warehouses participating in storage programs for the account of CCC and/or USWA, the amount or value of commodity in store, the length of time the commodities have been in store, whether the commodities are owned or pledged as collateral for loan to private lenders or CCC, and staffing level for the examination program. The value of dairy income is estimated at $24.8 billion in FY 2009. Falling below the 2010 baseline projection of $30 billion in the President’s budget, the decrease was mainly the result of lower than normal milk prices. The target for the annual measure, “Increase per capita milk production,” is 585 pounds of milk per person. The actual value was 622 pounds of milk per person in 2009. This maintains per capita milk production at the baseline average from 2002-2004. Selected Accomplishments Expected at the FY 2011 Proposed Resource Level: FSA works with its Dairy Product Price Support Program partners to provide adequate, secure storage capacity to maintain quality and improve the purchase and delivery of food aid. Food assistance purchases support domestic programs such as the National School Lunch Program and The Emergency Food Assistance Program, as well as international food aid through the U.S. Agency for International Development and the World Food Program. At the proposed FY 2011 resource level, FSA expects to support secure and affordable food and fiber by the following activities: • Commodity operations will facilitate and encourage electronic commerce to reduce costs and delays associated with marketing and delivering commodities and to increase sales of targeted agricultural commodities, - • Warehouse operators will issue negotiable warehouse receipts to producers under the provisions of the U.S. Warehouse Act. Producers who desire to use the stored commodity as collateral for a marketing assistance loan may deliver the warehouse receipts to FSA. FSA will accept the warehouse receipts a: security for a 9-month marketing assistance loan. Producers use the Marketing Assistance Loan Program as interim financing on the eligible stored commodities. 89 22-67 Efficiency Measure: The efficiency measure previously used for milk price support purchases is not applicable to the new Dairy Product Price Support Program created in the 2008 Farm Bill. A new efficiency measure will be developed. - Key Outcomes: Agency Strategic Goal 3 - Conserving Natural Resources and Enhancing the Environment • Quality Soil • Quality Water • Quality Wildlife Habitat • Quality Air HPPG Measure: FSA’s Conservation Reserve Program contributes significantly to practices that help create reliable supplies of clean water. In concert with other USDA partners, research is needed to develop or revise metrics that capture the number of acres with HIT practices applied to improved water quality and quantity. , . . . Long-term Performance Measures: . • Increase CRP acres of riparian and grass buffers. • Increase CRP restored wetland acres Selected Past Accomplishments toward Achievement of the Key Outcomes: FSA has made substantial progress in protecting watershed health and enhancing soil quality. Total enrollment in Conservation Reserve Program (CRP) was 33.8 million acres at the end of FY 2009. These acres have annually reduced soil erosion by more than 450 million tons, reduced nitrogen, phosphorus, and sediment leaving the field by well over 85 percent, and sequestered over 50 million metric tons of carbon dioxide, - CRP also contributes to increased wildlife populations, including more than 2 million additional ducks annually in the Northern Prairie, recovered sage and sharp-tailed grouse populations in Eastern Washington, increased ring-necked pheasant populations, and increased grassland bird populations. Restored wetlands in CRP reached more than 2.03 million acres at the end of FY 2009. These restored wetlands are the result of several initiatives, including the 500,000-acre Bottomland Hardwood Timber Initiative, a 250,000-acre Non-floodplain Wetland Restoration Initiative, and a 100,000-acre Prairie Pothole Duck Nesting Habitat Initiative. - - At the end of FY 2009, there were 43 Conservation Reserve Enhancement Program (CREP) agreements representing partnerships with 32 States. A total of 1.2 million acres of high value conservation practices are enrolled in CREP. Since the inception of the Grassroots Source Water Protection Program (GSWPP) in 2004 through the 2007/2008 program year, 385 SWP plans have been completed with management activities implemented. The plans provide protection measures for 1,608 public drinking water sources (1,282 wells and 326 surface water intakes) in 43 States. The 2008-2009 program year ended March 31, 2009. Preliminary data indicates that an additional 105 SWP plans will be completed and have protection activities implemented in the source water areas. 90 22-68 Selected Accomplishments Expected at the FY 2011 Proposed Resource Level: The CRP and CREP will continue to achieve the desired key outcomes. However, enrollment authority was decreased in the 2008 Farm Bill to no more than 32 million acres starting in FY 2010. Therefore, FSA expects enrollment to decline from FY 2009 to FY 2010. FY 2010 and FY 2011 enrollment is expected to be between 31 and 32 million acres. FSA works with its partners to improve conservation practices and target lands to maximize conservation benefits. Among the specific actions FSA will carry out at the proposed FY 2011 funding level are: • Advance wetland goals set in CRP by seeking new wetland contracts covering over 50,000 acres in both FY 2010 and FY 2011. These acres aid in attaining the USDA’s conservation and global change objectives. • Advance riparian buffer and grass filter goals set in the CRP by seeking contracts covering 40,000 acres in both FY 2010 and FY 2011. These acres aid in attaining the USDA's conservation and global change objectives. r - - • Advance wildlife population improvement goals by continuing several initiatives, including the 250,000-acre upland bird buffer, the 100,000-acre Duck Nesting Habitat Initiative, and State Areas for Wildlife Enhancement (SAFE) initiative, a 500,000-acre initiative announced in FY 2007 to improve habitat for endangered, threatened, or high-priority fish and wildlife species: • Continue the 250,000-acre initiative to restore longleaf pine. In the early 1700s, over 90 million acres of longleaf pine ecosystem existed. Today, fewer than 4 million acres exist. Producers with cropland that is suitable for longleaf pine can submit an offer for enrollment into the CRP under continuous signup provisions. Cumulative enrollment in FY 2008 was over 60,000 acres, Strategic Goal Funding Matrix (on basis of appropriation) 2009 Actual 2010 Estimated- 2011 Estimated Staff Staff increase or Staff Amount Years Amount Years Decrease Amount . Years Goal a/ Farm Loans. $559,732,000 2,923 $463,635,000 2,904 $13,956,000 $477,591,000 : 2,904 lncome Support and 832,280,670 8,047 884,703,276 9,090 107,673,600 992,377,676 9,100 Disaster Assistance Conservation 8,000 0 5,000 0. -2,000 3,000 0 Commodity Operations ... 60,165,000 | 17 61,377,000 103 777,000 62,154,000 ... " 103 Total, Goal i,452,185,670 | 1,087 1,409,720,276 12,097 122,405,400 1,532, i24,876 - 12,107. Goal w - Conservation 300,891,000 2,835 318,301,000 1922 -1,336,000 316,965,000 1,922. Total, Goal 300,891,000 2,835 318,301,000 1,922 - -1,336,000. 316,965,000 1,922 Total, Available 1,753,076,670 13,922 1,728,021.276 14,019 121,068,600 1,849,089,876 14,029 . aſ USDA will assist rural communities to create prosperity so they are self-sustaining, repopulating, and economically thriving by Less than 1 full staff-year - - - - c/ USDA will ensure our national forests and private working lands are conserved, restored, and made more resilient to climate change, while enhancing our water resources. 91 22-69 FARM SERVICE AGENCY Summary of Budget and Performance Key Performance Outcomes and Measures Goal: USDA will assist rural communities to create prosperity so they are self-sustaining, repopulating, and economically thriving - Key Outcomes - Supporting Productive Farms and Ranches (Agency Goal 1): Successful farms and ranches, market based agriculture, and thriving agricultural communities. - Supporting Secure and Affordable Food and Fiber (Agency Goal 2): Supporting adequate, secure storage capacity that maintains quality. Improving purchase and delivery of food aid. Key Performance Measures: • Increase percentage of beginning farmers, racial and ethnic minority farmers, and women farmers financed by FSA: Through its direct and guaranteed farm loan programs, FSA helps to meet the credit needs of farmers and ranchers who are temporarily unable to obtain sufficient credit elsewhere at reasonable rates and terms. • , - • Reduce average processing time for direct loans; Reduce average processing time for guaranteed loans: Providing service to customers in a timely manner is an important performance goal for FSA’s direct and guaranteed loan programs. As such, FSA is targeting continued improvement in loan processing timeliness. - • Maintain or increase percentage of program benefits delivered through a Web environment: Administering FSA's programs in a Web environment will improve customer service by reducing the number of hours needed to verify and disburse program benefits and will allow the Agency to explore opportunities for cost-savings through restructuring and realigning personnel and field offices. • Reduce average time between warehouse examinations: FSA's security efforts continue to focus on ensuring the adequate capacity of warehouse storage facilities, minimizing warehouse violations, and reducing the amount of stored products that go out of condition. Key Performance Targets - 2006 2007 2008 2009 2010 2011 Performance Measure Actual Actual Actual Actual Target Target Increase percentage of beginning farmers, racial and . ethnic minority farmers, and women farmers financed by FSA Units = percentage 15.5% 15.9% 16.22% 17.4% 17.5% {8.0% Reduce average processing time for direct loans Units = days - 31.0 27.0 27.8 33.5 33.0 32.5 Reduce average processing time for guaranteed loans Units = days - 12.63 12.6 8.55 13.5 13.25 13.0 92 22-70 2006 2007 2008. 2009 2010 20TT Performance Measure Actual Actual Actual Actual Target Target Maintain or increase - - percentage of program benefits delivered through a Web environment Units = percentage 33%" | 33%" 33%" 33%" 50%.” 80% Reduce average time between - | warehouse examinations Units = days 384 381 387 393 400 400 'Flat performance targets due to level funding ‘Starting 2010, figures will be calculated utilizing a different methodology that expands the number of programs in the numerator and denominator that are targeted for transition to a Web environment. Goal: USDA will ensure our national forests and private working lands are conserved, restored, and made more resilient to climate change, while enhancing our water resources Key Outcome – Conserving Natural Resources and Enhancing the Environment (Agency Goal 3); Quality soil, water, wildlife habitat, and quality air Key Performance Measures: • Increase CRP acres of riparian and grass buffers: Conservation buffers enhance water quality by intercepting farm sediment and nutrients before they enter waterways. • Increase CRP restored wetland acres: Restored wetlands and buffers increase prime wildlife habitat and water storage capacity, and lead to a net increase in wetland acres on agriculture land. Wetlands provide multiple environmental functions, including filtering of nutrients, recharging groundwater supplies, and sequestering carbon. Key Performance Targets: 2007 2006 2008 2009 2010 2011 Performance Measure Actual Actual Actual Actual Target Target increase CRP acres of riparian and grass buffers (cumulative) Units = millions of acres !.86 1.92 2.02 2.03 1.99' 1.99' Increase CRP restored wetland - acres (cumulative) Units = millions of acres 2.03 2.08 1.98 2.04% 1.99% 1.99' 'Recent commodity price increases, especially soybeans, will likely reduce landowner willingness to retire cropland into CRP. In addition, the enrollment authority for CRP decreased to 32 million acres, starting in FY 2010, *2009 spike in CRP Wetland acres enrollment was due to increased incentives for certain wetland practices and surge in general signup acres reenrolled into wetland practices. 93 22-7 i FARM SERVICE AGENCY Summary of Budget and Performance Yuli Cost by Department Strategic Goal epartment Strategic Goal: Assist rural communities to create prosperity so they are self-sustaining, repopulating, and economically thriving FY 2009 Amount FY 2010 Amount FY 2011 Amount RQGRAM M TE [3000) §000) ($000) arm Loans Direct Farm Ownership Loans $35,560 $26,520 $32,870 Direct Farm Operating Loans !24,545 47,500 54,540 Guarantced Farm Ownership Loans 4,200 5,550 5,700 Guaranteed Farm Operating Loans, subsidized 20,645 23,902 19,920 Guaranteed Farm Operating Loans, unsub 30,754 35, ióð 34,950 Emergency Disaster Loans 4,323 2,083 5,924 hidian Tribe Land Acquisition Loans {} () () Boit Weevil Eradication Loans 0 {} 0 Indian Fractionated Land Loans O 793 2 #4 Program Loan Cost Expenses 7,920 7,920 7,920 individual Development Account Grants 0 - {} () State Mediation Grants 3,277 3,277 3,277 Administrative costs (direct) 305,903 304,668 312,447 indirect costs 4,244 8,503 3,383 - total Costs' 541,341 465,818 483,515 FTE: 2,923 2,904 - 2,904 Performance Measure. Maintain or reduce average processing time for direct and guaranteed loans Pirect Loans (# of days); 33.50 33 00 32,50 Guaranteed Loans (# of days). t3 50 1325 ! 3.00 Performance Measury increase % of beginning farmers, racial and ethnic minority farmers, and women farmers financed by FSA Percent #7 40% $7.50% $8.00% 'For loan programs reſects subsidy budget authority to support loan levels come Support and Disaster Assistance Price Support and Marketing Assistance Loans Loan Deficiency Payments Direct Payments Countercyclical Payments Milk income Loss Contract Payments Tobacco Payments Other Dirict Payments NAP Payments Crop Disaster Assistance Livestock Indefinity Program Emergency Livestock Assistance Tree Assistance Program CCC Interest Expenditures Dairy indemnity Program Emergency Forestry Conservation Program USDA Supplermental Assistance, appropriated Reforestation Pilot Program Agricultural Disaster Relief Trust Fund (12X5531 and 12x5591) Aquaculture Grants (1233 i7) Farm Storage Facility Loans Sugar Storage Facility loans Administrative costs (direct) Indirect costs 8,290,909 148,553 4,176,795 1,243,300 769,900 1,130,095 84,375 40,700 | 14,828 i,716 1,926 68 2,856 65} 7,854 83,814 794 6,000 48,500 12,500 {} 694,980 226,903 17,058,019 9,258.75 8,125,368 178,526 5,444,270 1,219,205. 21 1,800 960,000 89.007 91, iſjø 290,500 0 500 {} 25,380 1,209 18,896 295,600 800 1,755,000 1,500 0 0. 660,473 288,760 19,357,894 9,386 90 7,799,757 23,258 4,962,893 738,412 100,000 960,000 84,728 95.200 0 {} 0. () 89.526 876 14,420 0 0. 1,398,000 () 0. 0. onservation Emergency Conservation Program Administrative costs (direct} Indirect costs Total Costs FTE: Total Costs FTE: 153,044 8,344 ſ? 161,388 0.25 95,000 4,803 Q 99,863 0.10 . 646,863 406,444 17,317,074 9,393.90 37,189 3,154 0 40,343 {} 10 94 22-72 Continued - Assist rural communities to create prosperity so they are self-sustaining, repopulating, and economically thriving FY 2009 Amount FY 2010 Amount FY 2011 Amount PROGRAM PRQGRAM ITEMS {{000). {{000) ($0.00) Commodity Operations ElS Cotton User Marketing Payments 9,630 1,394 Upland Cotton Economic Adjustment Assistance 74,661 72,613 81,72 Commodity Purchases and Sales 1,027,768 1,058,474 1,105,24 Storage, Handling, Transportation, Processing, and Packaging 67,740 87,166 64,76 CCC interest Expenditures 3,173 2,820 9,94 Dairy Price Support 226,894 65,379 Administrative costs (direct) 39,728 36,638 37.82 Indirect costs 33,697 37,055 36.68 Total Costs 1,483,291 1,361,539 1,336,19 FTE's 263 250 2 Total Costs for Department Strategic Goal (program, direct, indirect} 19,244,039 21,285,054 19,177,1 - FTE's 12,445 12,541 12.5 Performance Measure Maintain or increase percentage of program benefits delivered through a Web environment 33% 50% 80% Percent: Department Strategic Goal: Ensure our national forests and private working lands are conserved, restored, and made more resilient to clim change, while enhancing our resources FY 2009 Amount PROGRAM PROGRAM ITEMS f$800) Conservation Conservation Reserve Program 1,872,881 Grassroots Source Water Protection Program 5,000 State Mediation Grants 1,092 Direct Conservation Loans {} Guaranteed Conservation Loans {} Other Conservation Payments 46 Administrative costs (direct} 256,932 Indirect costs 63,352 Total Costs 2,199,303 FTE's 2,015 Performance Measure increase CRP acres of riparian and grass buffers # of acres in millions. 2 03 Performance Measure increase CRP restored wetlands - - # of acres in millions. 2 04 Total Costs for Department Strategic Goal (program, direct, indirect) 2,199,303 FTE's 2,015 Total Costs for Ait Strategic Goals (program, direct, indirect) 21,443,332 FTE: 14,460 FY 2010 Armount ($000) 2,006,279 5,000 1,092 1,065 278 16,704 223,539 105,327 2,359,284 1,978 | 99 1 99 2,359,284 1,978 23,644,338 14,549 FY 2011. Amouri ($009) ! 99 1.99 2,321,8 1,9: 21,499,0 14.5 95 2011 Explanatory Notes Risk Management Agency Table of Contents Purpose Statement............................. - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - Permanent Positions by Grade and Staff Year................................................. - - - - - - - - - - - - Motor Vehicle Fleet Data............................................................... • * * * * * * * * * * * * * * * * * * * - - Salaries and Expenses: Appropriations Language................................................................................ Lead-Off Tabular Statement...................................... - - - - - - - - - - - - - - - . . . . . . . . . . . . . . . . . . . . . . . Project Statement............................................. -- tº * * - - - - - - - - - - - - - e - - - a tº tº - - - ºr• * * * * * * * * * * * * * * * * Geographic Breakdown of Obligations and Staff Year............................................. Classification by Objects................................................................................ Status of Program........................................................................................ Federal Crop Insurance Corporation Fund: - Appropriations Language................................. • * * * * - - - - - - - - - - - - - - - - - - - - - * * * * * * * * * * * * * * * * * * * * Lead-Off Tabular Statement........................................................................... Project Statement......................................................................................... Justifications.............................................................................................. Geographic Breakdown of Obligations and Staff Year................... ......................... Classification by Objects......................................... • * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * Status of Program............... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . -- - - - - - - - - - - - - - - Summary of Budget and Performance: Statement of Goals and Objectives.................................................................... Key Performance Outcomes and Measures.......................................................... Full Cost by Department Strategic Goal.............................................................. Justifications............................................................................................... - p- ºr fºo-y TA A 96 23–1 RISK MANAGEMENT AGENCY Purpose Statement The Risk Management Agency (RMA) was established under provisions of the Federal Agriculture Improvement and Reform Act of 1996 (1996 Act), P.L. 104-127, approved April 4, 1996. This Act amended the Department of Agriculture Reorganization Act of 1994, P.L. 103-354, Title II, to require that the Secretary establish within the Department an independent office responsible for supervision of the Federal Crop Insurance Corporation (FCIC), administration and oversight of programs authorized under the Federal Crop Insurance Act (7 U.S.C. 1501 et seq.), including delivery of program services through local offices of the Department, any pilot or other programs involving revenue insurance, risk management savings accounts, or the use of the futures market to manage risk and support farm income that may be established under the Federal Crop Insurance Act, as amended, or other law, and such other programs as the Secretary considers appropriate. - Over the past six decades, Federal crop insurance has been the primary product provided by the FCIC/RMA and consists of various alternatives designed to improve the economic stability of agriculture. Recent legislative mandates have prompted significant program growth and the development of many large and complex new programs. RMA continuously strives to provide adequate risk protection for our Nation’s agricultural producers and tries to identify and address concerns about Federal crop insurance. RMA continues to evaluate risk management products, review and approve private sector products to be reinsured by FCIC, and ensure delivery of these products to agricultural producers. Risk management products can help producers protect themselves from yield risks, market risks, or both. Examples of more recent new and innovative insurance tools are revenue insurance, forage, rangeland, specialty crops, and livestock pilots. Education, outreach, and non-insurance risk management assistance initiatives and tools further contribute to the producers’ ability to protect their financial stability. Through the effective use of these tools, agricultural producers will have available a cost-effective means of managing their risk in order to improve the economic stability of agriculture. RMA estimates 568 FTEs for fiscal year (FY) 2011 and has staff at the Headquarters office in Washington, D.C., the National office in Kansas City, MO, 10 Regional Offices (ROs), and six Regional Compliance Offices (RCOs). As of September 30, 2009, RMA had 481 staff years with employees on board located throughout the Nation as follows: 73 at Headquarters in Washington, D.C., 174 at the National Office in Kansas City, MO, 151 in ROs, and 83 in RCOs. Major RMA functional areas include: Program Management/Office of the Administrator (OA): OA consists of the following staff offices: Civil Right and Community Outreach, External Affairs, Office of the Chief Financial Officer, Office of the Chief Information Officer, and Program Support. Product Management (PM); PM consists of the following: Deputy Administrator's staff, Product Analysis and Accounting Division, Product Administration and Standards Division, and Actuarial and Product Design Division. Insurance Services Division (ISD): ISD consists of the following: Deputy Administrator's staff Reinsurance Services Division, Risk Management Education Division, Risk Management Services Division, and 10 ROs located in the following cities: Billings, Montana; Jackson, Mississippi; Oklahoma City, Oklahoma; Raleigh, North Carolina; Davis, California; St. Paul, Minnesota; Spokane, Washington; Springfield, Illinois; Topeka, Kansas; and Valdosta, Georgia. Risk Compliance: Compliance consists of the following: Deputy Administrator’s staff, Insurance Operations Division, Policy, Procedures and Evaluation Division, and six regional compliance offices at the following locations: Dallas, Texas; Indianapolis, Indiana; Kansas City, Missouri; Raleigh, North Carolina; Davis, California; and St. Paul, Minnesota. 97 23-2 Evaluation Division, and six regional compliance offices at the following locations: Dallas, Texas; Indianapolis, Indiana; Kansas City, Missouri; Raleigh, North Carolina; Davis, California; and St. Paul, Minnesota. Office of Inspector General (OIG)/Government Accountability Office (GAO) Reports: The following tables provide a list of RMA audits completed and in progress during FY 2009. OIG/GAO AUDITS COMPLETED IN FISCAL YEAR 2009 IDENTIFYING DATE REPORT TITLE NUMBER ISSUED RMA Compliance Activities: The objective of this audit is to 0560?-1 1-AT 9/16/09 determine if compliance activities are adequate to improve program compliance and integrity, and to detect and reduce fraud, waste, and abuse. Crop Insurance Industry Financial Arrangements and GAO-09-445 4/29/09 Administrative and Operating Costs: The objectives of this audit are to determine what are the financial arrangements between crop insurance companies and their sales agents; what are the financial arrangements between sales agents and producers; and what are agents’ costs for selling crop insurance to producers, taking into consideration the different types and sizes of policies. - RMA 2005 Emergency Hurricane Relief Efforts in Florida: The 05099-28-AT 3/04/09 objective of this audit is to evaluate the adequacy of RMA's management controls to ensure timely and proper processing and establishment of loss determinations and indemnity payments resulting from Hurricanes Katrina and Wilma in Florida. RMA’s Use of NASS County Average Yields for the Group Risk 05601–4–KC 3/04/09 Protection Plans of Insurance: The objectives of this audit are to assess whether the processes used by NASS to establish county average yields provide accurate and reliable information, and whether the data collected to establish average yields for various crops and utilized by the USDA provide a sound basis for administering the affected programs, establishing program benefits and reporting roduction of commodities. - FCIC/RMA Financial Statements for Fiscal Years 2008 and 2007: 05401-17-FM 1 1/06/08 The objective of this audit is to present the auditors’ opinion on the - Risk Management Agency and Federal Crop Insurance Corporation rincipal financial statements for the fiscal years ended September 30, 2008, and 2007. 98 23-3 OLG/GAO AUDITS IN PROGRESS DURING FISCAL YEAR 2009 REPORT TITLE IDENTIFYING NUMBER START DATE Validity of New Producer Designations: The objectives of this audit are to assess the effectiveness of RMA and AIP controls for granting “new producer” designations and ensuring the propriety of actual production history yield determination for these insureds and conduct data analysis and field visits to review relevant documentation maintained by the AIPs and Farm Service Agency county offices to determine whether any “new producer” status designations were improperly awarded. * , O5099-114-KC 1705/09 T Citrus Crop Indemnity Payments Resulting from Hurricane Wilma in Florida: The objectives of this audit are to assess the impact of RMA’s emergency loss adjustment procedures for citrus fruit claims; RMA's oversight of the approved insurance providers' (AIP) - underwriting of 2006 citrus crop insurance policies; RMA's oversight of the AIP’s processing of loss adjustments and citrus indemnity claims for Hurricane Wilma damaged citrus crops; whether citrus producers provided the same acreage information to RMA that was provided to the Farm Service Agency (FSA); and whether citrus producers receiving RMA indemnity payments also received Animal and Plant Health Inspection Service’s 2006 citrus canker payments, 05099-29-At 10/27/08 FCIC/RMA Financial Statements for Fiscal Years 2009 and 2008: The objective of this audit is to present the auditors’ opinion on the Risk Management Agency and Federal Crop Insurance Corporation principal financial statements for the fiscal years ended September 30, 2009, and 2008. 05401-18-FM 5/01/08 Pasture, Rangeland, and Forage Pilot Program: The objectives of this audit are to determine whether RMA effectively implemented the PRF Pilot Program and the adequacy of RMA's controls in the PRF Pilot Program to minimize program losses and to ensure program integrity, including preventing producers from receiving improper indemnity payments for acres enrolled in FSA and NRCS programs. 50601-18-Te 3/24/08 RMA’s Implementation of the Approved Insurance Providers’ Appendix IV/Quality Control Reviews: The objective of this audit is . to assess the effectiveness of RMA's oversight activities over the AIP’s quality control reviews and of the AIPs implemented quality control review processes, as prescribed by the SRA, in preventing or detecting program abuse, waste, and improper payments. 050:16-1–KC 10/17/07 Hurricane Indemnity Program — Integrity and Reliability of Data Provided by RMA: The objective of this audit is to evaluate the adequacy of RMA's management controls over changes in data provided to FSA for use in its HIP and FSA's controls to ensure proper payments and any collection of overpayments resulting from these changes. - 50601-15-AT 6/18/07 Group Risk Crop Insurance: The objective of this audit is to evaluate the adequacy of the management controls over the group risk and group risk income protection plans to ensure that they are effectively administered and actuarially sound. 05601-14-TE 3/21/06 99 23-4 RISK MANAGEMENT AGENCY FEDERAL CROP {NSURANCE CORPORATION FUND Available Funds and Staff Years FY 2009 Actual and Estimated FY 2010 and FY 2011 2009 2010 20 i ; Actual Estimated Estimated - Staff • Staff Staff Amount Years Amount Years Annount Years . \&O Expense Appropriation - * * * * * * * $76,828,000 481 $80,325,000 568 . $83,064,000 568 . Jnobligated Balance . * * * * * 349,000 : 0 0 () () 0 . Total, A&O Expenses . . ........ º 77,177,000 481 80,325,000 - 568 83,064,000 568 ederal Crop insurance Corporation (FCIC) Fund remium Subsidy 5,498,209,000 . 0 - 4,211,255,000 {) 5,465,853,000 . 0. }elivery Expenses 1,650,825,000 : 0 1,567,145,000 : 0 , 1,683,633,000 : () . Jnderwriting Gains . . . . . . . . . Y- 1,277,290,000 . 0 1,167,759,000 0 - 1,204,771,000 {} ederal Crop Insurance Act Initiatives 74,500,000 0 . 74,500,000 . () 74,500,000 : () : ºpplication of Carryover -1,515,365,000 () -446,050,000 {} . –59,698,000 {} xcess Capital (FY Premium - FY Losses) -218,796,000 0 - - 19,331,000 0. 26,173,000 . () rojected Savings from Negotiations of SRA 0 O . {} 0 -782,000,000 {} . Total, FCIC Fund - * = - - - s 6,766,663,000 : () . 6,455,278,000 0 7,613,232,000 O |otal, Rusk Management Agency 6,843,840,000 : 48; 6,535,603,000 . 568 7,696,296,000 568 100 23-5 RISK MANAGEMENT AGENCY Permanent Positions by Grade and Staff Year Summary 2009 Actual and Estimated 2010 and 2011 • 2009 - 20i () - 20: 1 Grade • Wash, DC Field Total . . Wash DC Field Total • Wash. DC . Field Total Senior Executive Service 3. i 4 3 1 4. 3 l GS-15 - ll , 7 . 18 - : 12 . 7 H9 12 7 . l GS-14 º 8 . 36 . 44 . . 8 40 48 8 : 40. 4 GS-13 - 27 H.34 164 30 155 185 30 - 155 . {8 GS-12 • 1() 126 136 . 15 - 16} #76 i5 . 16] . 17 GS-R 3. 2. 35 37 2 . 28 - 30 2 28 : 3 GS-10 ! 0 i } 0 1 l {} GS-9 I 16 . 17 - | 28 29 ! . 28 2 GS-8 3 7 . ł0 3 . 7 10 3 . 7 . } GS-7 4. 22 26 - 5 28 33 5 : 28 3 GS-6 i 16 ° 17 . i 2} . 22 ! . 21 2 GS-5 l 5 . 6 : i . 4 . 5. | - 4 . GS-4 1 . 3 . 4 . 1 3 : 4 1 3 : Other Graded Positions {} 2 2 : {} . 2 - 2 - () . 2 - Ungraded Positions. . . 0 - {} - 0 . 0 O {} {} {} , | Total Permanent te - w * Positions 73 . 440 483 83 485 568 83 : 485 . 56 Unfilled Positions * * - end-of-year....................... : 0 - 2 . 2 0 - O {} . {} 0 Total, Permanent Full-Time : : e r * Employment, end-of-year : 73 408 : 481 : . 83 485 568 83 . 485 56 Staff Year Estimate - 73 - 408 48} 83 : 485 568 83 . 485 - 56 101 23-6 Size, Composition, and Annual Cost (in thousands of dollars) Number of Vehicles by Type” Fiscal Sedans Light Medium i Ambulances Buses | Heavy Total Annual Year and Trucks, Duty Duty Number Operating Station SUVs and | Vehicles Vehicles of Cost Wagons Vans Vehicles ($ in thous) * * * 4X2 4X4 FY 2008 | 0. 2 2 0 O 0. 5 $38 Change from 2008** 0. 0 O 0. 0 {} 0 O -1 FY 2009 } O 2 2 0 0 0 5 37 Change from 0 0 0 0 () 0 () 0. +1 2009 FY 2010 | 0 2 2 0 {) 0 5 38 Change from O 0 0 O 0. {} O () + 1 2010 FY 2011 l O 2 2 0. O O 5 39 NOTES: *}: All of the vehicles listed are leased from the General Services Administration (GSA). These vehicles are assigned in the RMA field structure of the Regional and Compliance Field Offices, Each Regional and Compliance office is assigned a geographical area within the United States to perform monitoring and oversight of the crop insurance program. These vehicles are used to perform site visits of crops and/or inspections of crop losses. Also, they are used to attend conferences and meetings related to crop insurance issues. Since these vehicles are leased from GSA, RMA relies upon GSA to supply the Agency with alternative-fueled vehicles as required by law. 102 23–7 RISK MANAGEMENT AGENCY The estimates include appropriation language for this item as follows: Administrative and Operating Expenses: For necessary expenses of the Risk Management Agency, [$80,325,000] $83,064,000: Provided, That th funds made available under section 522(e) of the Federal Crop Insurance Act (7 U.S.C. 1522(e)) may be used for the Common Information Management System: Provided further, That not to exceed $1,000 sha be available for official reception and representation expenses, as authorized by 7 U.S.C. 1506(i). 103 23-8 RíSK MANAGEMENT AGENCY LEAD-OFF TABULAR STATEMENT AIMINISTRATIVE AND OPERATING EXPENSES Appropriations Act, 2009 • * * * * * * * * * g tº e $80,325,000 Budget Estimate, 2010 . • 4 e 4 - 83,064,000 increase in Appropriation -- + 2,739,000 SUMMARY OF INCREASES AND DECREASES (On basis of appropriation) 2010 Pay Program 2011 ſtem of Change - Estimated Costs Changes Estimated Admunistrative and Operating Expenses, Available - $80,325,000 $739,000 $2,000,000 $83,064,000 Total Available 30,325,000 739,000 2,000,000 33,064,000 Project Statement (On basis of appropriation) Increase 2009 2010 Ot 20 l i Actual Estimated Decrease Estimated Staff - Staff Staff Amount Years Amount Years Amount . Years 1 Administrative and Operating Expenses $76,827,932 48 | $80.325,000 568 + $2,739,000 $83,064,000 : 568 2 Unobligated Balance 349,068 0. 0 : 0. 0 0. 0. Total Available or Estimate * * - 77,177,000 481 80,325,000 568 + 2,739,000 83,064,000 . 568 Total, Appropriation,. . . . . . 77,177,000 48} 80.325,000 568 2,739,000 83,064,000 568 104 23–9 RISK MANAGEMENT AGENCY Justification of Increases and Decreases (1) An increase of $2,739,000 for administrative and operating costs and activities directed at achieving the RMA mission, goal, and objectives ($80,325,000 available in FY 2010): (a) An increase of $739,000 for pay costs of 568 staff years. Funding for a pay related increase is necessary to maintain appropriate staffing to carry out the RMA mission, and mandated requirements. This finding is a critical component of our ability to provide support for a significantly growing program, including the development of many large and complex new risk management tools. Sufficient salary and benefit funding for the RMA workforce is needed to accomplish Agency strategies such as: promoting additional, improved, or consolidated products; enhancing product delivery; providing educational opportunities; and reducing program and administrative inefficiencies. (a) An increase of $2,000,000 to support RMA Information Technology (IT) initiatives: This increase is requested to support RMA IT investments which directly support Secretary's Goal 1. Adequate funding will ensure that USDA assists rural communities in creating prosperity so they are self sustaining, repopulating and economically thriving. Additional IT resources are critical for RMA to properly exchange data with private insurance partners, interface with industry companies and other government entities, confirm and assure optimal program performance, and develop, deliver, or monitor the risk management program. The Agency will be able to sustain its 24x7 operating environment and continue to support hardware, software and network upgrades. 105 23–10 RISK MANAGEMENT AGENCY ADMINISTRATIVE AND OPERATING EXPENSES GEOGRAPHIC BREAKDOWN OF OBLIGATIONS AND STAFF YEARS 2009 Actual and Estimated 2010 and 2011 2009 2010 20 i ! Staff Staff Staff Amount Years Amount Years Amount Years alifornia $3,239,161 26 $3,386,602 34 $3,430,838 34 )1strict of Columbia....................... 18,163,138 73 18,989,891 83 19,097,879 83 ieorgia…~~ 1,639,672 15 1,714,307 18 1,737,726 18 llinois................ 1,578,928 16 1,650,798 21 1,678,120 21 ndiana 1,208,688 11 1,263,705 16 1,284,522 16 Cansas............................................. 1,817,564 16 1,900,296 20 1,926,317 20 'ſinnesota....................................... 3,470,813 29 3,628,798 39 3,679,539 39 ſississippi...................................... 1,612,991 14 1,686,411 17 1,708,529 17 Missouri 33,917,520 196 35,461,384 206 37,729,402 206 4ontana.......................................... 1,664,297 14 1,740,053 18 1,763,472 18 Worth Carolina................................ 3,453,474 29 3,610,670 38 3,660,110 38 klahoma....... 1,751,994 14 1,831,742 20 1,857,763 20 "exas 1,533,500 13 1,603,302 18 1,626,721 18 Washington 1,776,192 15 1,857,041 20 1,883,062 20 Subtotal, Available or Estimate... 76,827,932 481 80,325,000 568 83,064,000 568 Unobligated balance.................... 349,068 () 0 0 0 0 Total, Available or Estimate.... . 77,177,000 481 568 S68 80,325,000 83,064,000 106 23-11 RISK MANAGEMENT AGENCY Classification by Objects 2009 Actual and Estimated 2010 andzon ADMINISTRATIVE & OPERATING EXPENSES: Personnel Compensation: Washington, D.C. Field 1 | 12 13 - * 4 tº 6 - - - at º & J & a Total Personnel Compensation....................... Personnel Benefits.................................... Benefits for Former Personnel.................. - - - - - - - Total Pers. Comp. and Benefits................ Other Objects: Travel and transportation of persons.............. 21 22 23.2 23.3 24 25.1 25.3 25.4 25.6 25.7 26 31 42 43 Total direct A&O obligations Equipment Transportation of things............................ Rental payments to others........................ Communications, utilities, misc. charges.. Printing and reproduction........................ = Advisory and assistance services.............. Purchase of good and services * * * * * * * - - - - - - - - - - * * * * * * * - - - - - * * * * * * * * * * * * from Government Accounts..................... Operation and maintenance of facilities.... Medical care Operation and maintenance of equipment Supplies and materials 4 * * * * Litigation fees/settlement-EEO. . . . . Interest...................................................... Total other objects...... • * * * * * * * - - * * * * Unobligated Balance Position Data: Average Salary, ES Positions Average Salary, GS Positions Average Grade, GS Positions º e º ºr 4 ºr 4 º' tº e º 'º we o º º v 8 º' & 8 & 3 & 8 - - e 4 w w w w tº e • *s a w w w w is a y < * * * * * * * * * * * * * * * * * * tº sº ºf s ºn tº 2009 2010 2011 $7,542,443 $7,571,210 $7,683.36. 34,493,699 35,934,790 36,581.63: 42,036,142 43,526,000 44,265,00 10,261,108 11,380,000 11,380,00 0 0 ſ 52,297,250 54,906,000 55,645,00 1,907,980 1,918,000 1,918,00 81,529 154,000 154,00 351,571 352,000 352,00 1,092,490 392,000 392,00 91.718 99,000 99,00ſ 8,122,261 9,599,000 9,599,00 9,221,027 10,789,000 10,789,00 883,544 1,034,000 1,034,00 233 - {) ( 414,173 484,000 2,484.00 298,283 329,000 329,00 1,513,761 194,000 194,00 551,520 75,000 75,00 592 O 24,530,682 25,419,000 27,419.00 349,068 O 77,177,000 80,325,000 83,064,00 $161,992 $165,235 $167,71 $86,796 $89,899 $91,24 12.6 12.7 12. 107 23g-1 RISK MANAGEMENT AGENCY ADMINISTRATIVE AND OPERATING EXPENSES STATUS OF PROGRAM Surrent Activities: The Federal Crop Insurance Corporation (FCIC) Board of Directors (Board) is composed ºften members, including agricultural producers, insurance and reinsurance experts, and senior USDA officials. This Board, either directly or through delegations to the Manager of the FCIC and Risk Management Agency RMA), manages FCIC and the Federal Crop Insurance Fund. The Board receives, reviews, and approves olicies and plans of insurance and other related materials for reinsurance, risk subsidy, and administrative and perating subsidy. The Board is authorized to reimburse outside entities for research, development, and aintenance costs. This provides an incentive for the development of new and innovative risk management roducts, to directly contract for the research and development of such products, and to fund crop insurance ducation programs. During FY 2009, the FCIC Board considered 61 action items during seven Board eetings. The action items included 20 expert reviews, 16 program modifications and 19 new program ubmissions. In 2009, pursuant to the Food, Conservation, and Energy Act of 2008 (2008 Farm Bill), the board egan reviewing concept proposals for the new policies and plans for insurance. )ffice of the Administrator (OA) activities include all management and administrative support functions of he RMA. This includes coordinating FCIC Board Meetings and administrative support services to all locations f RMA including information technology and other services. OA is responsible for developing agency trategic plans, performance plans, planning, coordinating, testing, and implementing emergency programs lcluding contingency operations, pandemic influenza plans, coordination and response to homeland security fforts, developing Information Resource Management plans and policies as required by the Information echnology Management Reform Act of 1996 (ITMRA) and other legislation. |A directs the establishment of RMA plans and policies relative to obtaining public participation in the rule- taking process, with coordination of regulatory review requirements. Other activities include: coordinating nd publishing regulations; serving public requests for information under the provisions of the Freedom of lformation Act and protecting personal identifiable information in accordance with the Privacy Act; »rmulating RMA public information policies and programs within the framework of USDA’s public affairs Slicy; directing public information activities through news releases, audiovisual products, articles, and jeeches; answering correspondence; and producing public information on RMA activities and initiatives. A also provides policy-making recommendations that impact the often conflicting needs of agricultural roducers, the crop insurance industry, insurance agents, and the FCIC. The office advises Congress regarding dministration policy positions and matters relating to constituent service issues; and serves as the focal point ºr all financial management activities with overall responsibility for planning, organizing, and directing RMA scal functions including budget, accounting, financial reporting and other related functions. OA formulates, commends, administers and evaluates the Civil Rights and Equal Employment Opportunity programs and formation technology functions of RMA. ommunity outreach accomplishments in the partnership program include funding, administering and providing lbstantial involvement for 65 outreach projects, totaling over $7.1 million. In 2009, programs were aimed at oviding women and limited resource farmers and ranchers with the information and training necessary to ake informed decisions regarding the use of existing and emerging risk management tools. Through ership agreements, a National Outreach Conference was sponsored entitled “Risk Management Strategies r Beginning and Small Farmers and Ranchers” to provide information to farmers and ranchers, and train them the use of risk management tools. 108 23g-2 Product Management (PM) key functions include policy administration, establishment of underwriting and loss adjustment criteria, calculation, and maintenance of premium rates, and determination of price election, Ir addition, the program area enters into contracts for research, development, pilot testing, and evaluation of new crop insurance programs and contracts for plans of insurance and risk management strategies, especially for specialty crops and underserved commodities in underserved states and areas. In 2009, to further program goals, 13 contracts for expansion of new crop insurance programs and risk management strategies were issued. These included development and evaluation projects to expand and improve the risk management opportunities for American producers. For instance, contracted research and development projects resulted in the development of new pilot crop insurance products for Quarantine coverage for citrus produced in California, a innovative revenue product for navel oranges, and new pilot programs soon to be implemented for sesame and strawberries. Other products in development include lawn seed insurance, while research is underway on the impact of climate change on the crop insurance program as a whole. - Multi-year partnerships for developing non-insurance risk management tools to help growers mitigate various risks inherent to farming and raising livestock, to evaluate and make recommendations for improvement of existing risk management programs, and to coordinate support for specialty crop programs are ongoing. Information regarding many of these partnership projects with private sector organizations, universities, and other USDA agencies are located on RMA's website at http://www.rma.usda.gov. The PM function also includes accounting for RMA’s program operation, financial analysis, and operations reviews of the insurance delivery system. They are responsible for developing federal regulations and | establishing the crop insurance policies, premium rates, coverage provisions, transitional yield factors, and oth appropriate insurance data for approximately 64,000 county-crop programs nationwide. The program area establishes reporting requirements for automated systems that receive and validate crop insurance sales, loss and acreage data from reinsured companies and other sources. The data is used for analysis, determination of rates, calculation, and payment of expense reimbursements and underwriting payments to reinsured companies payment of claims, summaries of business and various other purposes. The Agency continues to review produ proposals submitted under Section 508(h) of the Federal Crop Insurance Act. Insurance Services activities include overseeing program delivery through reinsurance, underwriting and loss adjustment activities, and risk management education. Insurance Services develops and administers reinsuranc agreements with private insurance providers; coordinates underwriting and loss adjustment activities, including appeals; and contributes to program development. In addition, a substantial risk management education • program is carried out primarily through competitively selected partnership agreements. RMA Insurance Services provides guidance on emerging issues involving claims and underwriting, and ensure consistent application of actuarially sound insurance principles. Key responsibilities include overseeing the administration of the Standard Reinsurance Agreement (SRA), the contract between the private insurance providers and RMA and approving insurance providers on an annual basis. RMA is in the initial stages of renegotiation of this contract for the 2011 reinsurance year. RMA Insurance Services works with public and private partners to train farmers and ranchers in using risk management tools and strategies. This activity reached approximately 20,000 producers and provided approximately $6.4 million in federal funds during fiscal year 2009. This effort provides farmers with information and with educational opportunities to become more aware of risk, know the tools available to manage risk, and learn strategies for making sound risk management decisions. RMA continues to partner wi the National Institute of Food and Agriculture (NIFA), the Commodity Futures Trading Commission, and the USDA National Office of Outreach to provide risk management education to U.S. farmers and ranchers. 109 23g-3 Compliance activities include ensuring that funds expended by RMA for operation and delivery of risk management programs are spent in accordance with laws, rules, regulations, policies, procedures, and structions to achieve the intended purpose. RMA performs this mission by conducting reviews of programs d activities; maintaining liaison with external audit and investigative agencies; and reviewing the activities of insured companies and others involved in the delivery of programs. The Agency also performs a significant umber of additional reviews based on Office of Inspector General Hotline complaints, external audits and vestigations, and complaints from other sources to gather evidence to support allegations of non-compliance ith laws, regulations, or agreements. RMA works closely with the Farm Service Agency (FSA) field offices the detection and monitoring of suspected waste, fraud, and abuse by using data mining to target anomalous insurance payments to producers. Efforts continue to concentrate on the mission-critical task of evaluating and improving processes to prevent and deter waste, fraud and abuse, as well as building and adapting reporting, tracking, and feedback systems. In 2009, RMA completed fieldwork on the fifth round of national program review of companies. The plan calls for review of approximately one third of the participating Approved Insurance Providers (AIPs) each year in brder to derive a program error rate every three years. Selected Examples of Recent Progress: P-W Concept Proposals reflect the quick response by RMA to legislative mandates. The 2008 Farm Bill required hat FCIC write procedures to provide an advance payment of up to 50 percent of reasonable research and levelopment costs prior to submission and approval of a policy by the Board under section 508(h). Thirteen roposals have been submitted to the FCIC Board of Directors as of November 2009. olicy Maintenance continues as a part of RMA's ongoing oversight of existing crop insurance programs. roposed and final rules were issued that implemented changes and improvements to RMA’s Northern and outhern Potato policies, Grape and Table Grape policies, and the Tobacco crop provisions. The changes anged from providing more coverage choices and options for producers to tightening program provisions to itigate opportunities for fraud, waste and abuse. - he Sanctions Rule amended the Administrative Remedies for Non-Compliance regulations which became ffective January 20, 2009. This rule added additional administrative remedies and clarified existing dministrative remedies to strengthen RMA’s ability to combat fraud, waste and abuse by establishing a strong ystem of administrative actions that are now applicable to participants in the Federal crop insurance program. 'ack Factor Development is on track. RMA entered into a partnership with USDA’s Agricultural Research ervice (ARS) to develop pack factors to determine the mass of grain in storage from bin dimensions, test Weights and other relevant variables. The pack factors, used in the loss adjustment process, will be developed pr wheat, corn, soybeans, oats, barley, and grain sorghum. The first of the pack factors will be received from ARS in 2011 with the last pack factors due to be received in 2013. trategic Planning activities have started in order to revise the 2010-2015 USDA Strategic Plan, and RMA has ganized a Strategic Planning Team to work with various program units. As part of this planning process, the am established objectives, performance measures and strategies to facilitate RMA meeting its goals. RMA simplemented an internal quarterly reporting process that keeps management aware of the progress that A is making to implement strategic objectives and accomplish performance measures. Clean Audit Opinion was received by RMA for fiscal years 2008 and 2009 and reported to the Office of spector General from independent auditors. This report contains an unqualified opinion on the financial tement as well as an assessment of RMA's internal controls over financial reporting and compliance with ºws and regulations. 110 23g–4 Federal Manager’s Financial Integrity Act (FMFLA) Assurance provides systems, controls, and legal compliance to RMA management who is responsible for establishing and maintaining effective internal control to ensure the effectiveness of operations, reliability of reporting, compliance with applicable laws, regulations and safeguarding assets. RMA has conducted its assessment of internal controls and financial systems pursuan to FMFIA. Based upon the results of this evaluation, RMA can provide reasonable assurance that the internal control over the effectiveness and efficiency of operations and compliance with laws and regulations, as of September 2009 was operating effectively with no material weaknesses found in the design or operation of the internal controls. - - - - Improper Payment Rates reported in the 2009 Corrective Action Plan for the Federal crop insurance program were 5.8%. This 5.8% error rate represents the weighted average of indemnity errors identified in the 2005, 2006, and 2007 crop year policy samples. RMA has determined that the difference in error rates between crop years is consistent with the normal error distribution expected over time. The strategy for identifying and controlling the error rate includes identifying error trends and policy concerns and correcting them; however, n underlying policy or underwriting issues have been 1dentified in the random samples to date. RMA/National Association of Insurance Commissioners (NAIC) Collaborative Regulatory Efforts includ loss adjuster licensing, federal/state rebating enforcement initiative, Conflict of Interest Disclosure Guidance, and Disaster Estimation and Reporting System. - Loss adjuster licensing guidance was provided by RMA during FY 2009. Presentations were given to industry officials regarding inconsistent state licensing requirements. A memorandum was issued outlining financial penalties assessed for violating the Standard Reinsurance Agreement (SRA) requirement that all loss adjusters must be licensed by the State if the State requires licensing. RMA strengthened the Federal/State Rebating Enforcement Initiative. RMA and insurance commissioners from a number of key States issued a letter to AIPs announcing collaboration in the enforcement of State and Federal anti-rebating statutes. AIPs ensure that agents and loss adjusters are fully aware of the rebating prohibitions and stepped-up enforcement initiative prior to spring sales. RMA Conflict of Interest Disclosure Guidance to the industry was reviewed during FY 2009. RMA received and reviewed industry comments. The Disaster Estimation and Reporting System (DERS) was used during FY 2009 in an ad hoc manner. Although the current system is designed for hurricanes, DERS provides timely and accurate indemnity estimates, reports, and maps prior to, during, and after crop disasters to generate reports on disasters - the U.S. - - 111 23-12 RISK MANAGEMENT AGENCY The estimates include appropriation language for this item as follows: Federal Crop Insurance Corporation Fund: For payments as authorized by section 516 of the Federal Crop Insurance Act (7 U.S.C. 1516), such sums as may be necessary, to remain available until expended. 112 23-13 RISK MANAGEMENT AGENCY Lead-Off Tabular Statement FEDERAL CROP TNSURANCE CORPORATION FUND Appropriations Act, 2010 Budget Estimate, 201 | Increase in Appropriation RISK MANAGEMENT AGENCY FEDERAL CROP TNSURANCE CORPORATION FUND SUMMARY OF INCREASES AND DECREASES (On basis of appropriation) $6,455,278,000 7,613,232,000 1,157,954,000 20 0 Program 20 i ! Item of Change Estimated Pay Costs Changes Estimated Premium Subsidy $4,211,255,000 0 $1,254,598,000 $5,465,853,000 Delivery Expenses .. 1,567,145,000 O | ió,488,000 1,683,633,000 Underwriting Gains 1,167,759,000 {} 37,012,000 1,204,771,000 Federal Crop Insurance Act Initiatives 74,500,000 {} {} 74,500,000 Application of Carryover –446,050,000 O 386,352,000 -59,698,000 Excess Capital (FY Premiurn - FY Losses (Timing)} -119,331,000 () 145,504,000 26, 173,000 Projected Savings from Negotiations of SRA {} {} -782,000,000 –782,000,000 Total Available 6,455,278,000 {} 1,157,954,000 7,613,232,000 113 23-44 RISK MANAGEMENT AGENCY FEDERAL CROP TNSURANCE CORPORATION FUND Project Statement (On basis of appropriation) Hricrease or 2009 Actual 2010 Estimated Decrease 2011 Estimated Premium Subsidy $5,498,209,000 $4,211,255,000 $1,254,598,000 $5,465,853,000 Delivery Expenses 1,650,825,000 1,567,145,000 | 16,488,000 ł,683,633,000 Underwriting Gains. . | 277,290,000 1,167,759,000 37,012,000 1,204,771,000 Federal Crop insurance Act Initiatives....., 74,500,000 74,500,000 () 74,500,000 Application of Carryover * * * -1,515,365,000 -446,050,000 386,352,000 –59,698,000 Excess Capital (FY Premium - FY Losses (Timing)} -218,796,000 . I lº,331,000 145,504,000 26,173,000 Projected Savings from Negotiations of SRA 0 0 -782,000,000 -782,000,000 Total Available or Estimate. 6,766,663,000 6,455,278,000 1,157,954,000 7,613,232,000 Project Statement (On basis of available finds) increase or 2009 Actual 2010 Estumated Decrease 2011 Estimated 1 Expenses: (a) Indemnities $8,446,173,395 $7,669,250,000 $1,370,993,000 $9,040,243,000 (b) Delivery Expenses. , ł,601,806,914 1,567,145,000 i 16,488,000 l,683,633,000 (c) Federal Crop Insurance Act Initiatives: 53,370,563 74,500,000 0 74,500,000 (d) Underwriting Gatns/Losses . 1,962,597,319 1,167,759,000 37,012,000 1,204,771,000 (e) Projected Savings from Negotiations of SRA {} {} -782,000,000 -782,000,000 Total, Expenses * - - 12,033,948,191 10,478,654,000 742,493,000 t 1,221,147,000 2 Funds Available from Revenue and prior year balances (a) Producer Premium. * * * * * - - - - -$4,143,256,420 -$3,513,245,000 -$34,972,000 -$3,548,247,000 (b) Administrative Fees . . º -67,713,789 –64,084,000 4,383,000 -59,698,000 (c) Unobligated Balance Brought Forwar from Prior Year . –2,052,364,820 –996,050,000 446,050,000 -550,000,000 (d) Unobligated Balance Carried Forward to Next Year . . º .996,049,538 550,000,000 0 550,000,000 Total, Funds from Revenue and Balances * * * * * * –5,267,285,191 ~4,023,376,000 415,461,000 -3,607,915,000 3 Total, Available Funds 6,766,663,000 6,455,278,000 1,157,954,000 7,613,232,000 114 23-15 Federal Crop Insurance Corporation (1) A budget increase of $1,157,954,000 is estimated for the Federal Crop Insurance Corporation (FCIC) Fund, ($6,455,278,000 available in 2010). (a) (b) (c) (d) (e) An increase of $1,254,598,000 is projected for premium subsidy, Premium subsidy is primarily based on the result of participation changes. Program indicators suggest a modest increase in 2011 due to a slight projected escalation in commodity prices. Each year, approximately 1.3 million crop insurance policies are sold. The Federal government subsidizes premium on those policies. The requested $5.5 billion in premium subsidy is necessary to effectively provide producers higher levels of protection at more affordable prices. An increase of $116,488,000 is projected for delivery expenses. A funding increase for delivery expenses, the amount of administrative and operating expense reimbursements provided to approved insurance providers, is projected because of an increase in estimated premium levels. These funds are for delivering risk management services and/or products, and are based on a percentage of estimated total premiums for each crop year. Recently enacted changes in the Farm Bill capped the reimbursement rate at 22.2 percent. For FY 2011, estimated total premium is projected at $8.6 billion. As a result, RMA anticipates delivery expenses of $1.7 billion. These funds will assure effective delivery of risk management products to the agricultural community through reinsured companies, a process to which the Department is committed. An increase of $37,012,000 is projected for underwriting gains. Underwriting gains are the reinsured company’s share of the net book premium when it exceeds its share of ultimate net indemnities. This amount correlates with the increase in indemnities, which in FY 2011 is projected to be $9.1 billion. For FY 2011, the estimated amount of underwriting gains is $1.2 billion. An increase of $386,352,000 to account for changes in carryover balances. Carryover from FY 2009 to FY 2010 was $996.1 million. RMA applied $446.1 million of that in lieu of appropriations in FY 2010, maintaining their annual reserve of $550 million. There is not expected to be any carryover balances other than the $550 million reserve in 2011. Therefore, the difference is an increase of $388 million in application of carryover balances. An increase of $145,504,000 in capital required due to timing (FY Premium- FY Losses). The total amount requested, $39.0 million, will fund the difference between expected fiscal year (FY) losses and total FY premium. Although the estimates are based on a 1.0 loss ratio for the crop year, the conversion to FY data creates an additional need in FY 2011. Approximately 65 percent of crop year 2010 losses will be paid in FY 2011. In addition, these funds will cover any underwriting gain due reinsured companies, less the amount of administrative fees collected from the producer. Without these funds, farmers experiencing crop/livestock losses would not receive full benefit for the projected $9.0 billion in indemnities to protect them from unavoidable causes such as weather, reduced prices, or reduced yields. 115 23-16 (f) A decrease of $782,000,000 in projected savings from negotiations of the Standard Reinsurance Agreement. During 2010, USDA will be pursuing changes to the financial terms in the agreement it has with the companies, the Standard Reinsurance Agreement (SRA). The Administration wants to promote change in the crop insurance program through the SRA re-negotiation. There is currently excess subsidy in the program for the companies, and the government should be able to offer the same program at less cost through the changes to the SRA proposed by the Administration on December 4, 2009. The Budget assumes that the SRA proposal will save the government $8 Billion over 10 years. * 116 Alabama Alaska Anzona Arkansas.. California Colorado Connecticut Delaware Florida . . Georgia Hawaii Idaho Illinois indiana Iowa . Kansas Kentucky Louisiana Maine Maryland Massachusetts Michigan. Minnesota Mississippi . Missouri Montana Nebraska Nevada New Hampshire New Jersey. .. New Mexico. . . . New York North Carolina North Dakaota Ohio Oklahoma Oregon Pennsylvania Rhode Island South Carolina South Dakota Tennessee Texas Utah Vermont .. Virginia Washington West Virginia Wisconsin Wyoming Puerto Rico Subtotal, Indemnities aſ........ Undistributed by ..., .......... ... . Total, Available or Estimate - - - - - - 23-17 RISK MANAGEMENT AGENCY FEDERAL CROP [NSURANCE CORPORATION FUND * * * * * * e º se e A y º e ra Geographic Breakdown of Obligations 2009 Actual and Estimated 2010 and 201 | 2009 2010 2011 Amount Amount Amount $186,492,020 $169,941,119 $200,320,633 0 0. 0 10,189,770 9,285,443 10,945,354 67,675,455 61,669,355 72,693,673 21 1,485,796 192,716,733 227,167,728 146,886,499 133,850,531 157,778,313 9,612,991 8,759,852 10,325,806 59,408,283 54,135,882 63,813,480 77,480,705 70,604,403 83,225,995 168,419,598 #53,472,599 180,908,118 192,260 175,197 206,516 69,982,573 63,771,719 75,171,866 318,959,033 290,651,873 342,610,237 222,060,086 202,352,570 238,526,1 i5 410,282,445 373,870,463 440,705,393 856,132,956 780,152,376 919,616,267 149,962,656 136,653,684 161,082,571 47,872,694 43,624,061. 51,422,513 8,843,951 8,059,063 9,499,741 123,238,541 | 12,301,296 132,376,831 6,536,834 5,956,699 7,021,548 241,093,808 219,697,076 258,971,210 786,450,383 716,380,657 844,444,400 70,559,352 64,297,310 75,791,415 123,623,061 i 12,651,690 132,789,863 202,257,325 184,307,276 217,254,955 368,369,805 335,677,510 395,684,879 192,260 175,497 206,516 1,345,819 1,226,379 1,445,613 6,921,353 6,307,093 7,434,580 9,612,991 8,759,852 10,325,806 49,218,513 44,850,440 52,868,126 470,652,027 428,882,330 505,554,453 725,396,28] 661,018,395 779,185,308 177,648,069 161,882,056 190,820,892 331,840,440 302,390,074 356,446,847 48,257,214 43,974,455 51,835,545 91,900,191 83,744,180 98.714,704 {) • 0 {) l 12,664,252 102,665,460 121,018,444 548,324,992 499,661,930 588,983,964 166,881,519 152,071,022 179,255,989 287,620,683 262,094,757 308,948, H10 2,499,378 2,277,561 2,684,710 6,452,314 5,606,305 6,608,516 160,344,686 146,114,323 172,234,441 66,521,896 60,618,172 71,454,576 7,1 13,613 6,482,290 7,641,096 169,188,637 154,173,387 181,734,183 32,107,389 29,257,904 34,488, H9) 0 0. 0 8,416,173,395 7,669,250,000 9,040,243,000 3,617,774,796 2,809,404,000 2,480,904,000 l 7053.543. 191 10,478,654,000 | 1,224,147,000 aſ Due to the inability to predict the location of losses, it is impossible to accurately estimate a State cost distribution These estimates are based on previous distribution bf Undistributed includes, Delivery Expenses, FCIA costs, interest, Underwriting Gains/(Losses) and other expenses that cannot be distributed by State 117 23-18 RISK MANAGEMENT AGENCY Classification by Objects 2009 Actual and Estimated 2010 and 2011 2009 2010 2011 CIC FUND: 25 Delivery Expenses.........., - - - sº tº e - c. - - - - - - - $1,601,806,914 $1,567,145,000 $1,683,633,000 FCIA costs. ….. w a e º a s tº “ - - - - - 53,370,563 74,500,000 74,500,000 Underwriting Gains/Losses......... 1,962,597,319 1,167,759,000 1,204,771,000 Projected Savings from SRA Negotiations. . . . 0 {} -782,000,000 42 Indemnities... . 8,416,173,395 7,669,250,000 9,040,243,000 12,033,948,191 10,478,654,000 11,221,147,000 TOTAL FCIC FUND OBLIGATIONS.,............. . - 118 23g-5 RISK MANAGEMENT AGENCY • . FEDERAL CROP INSURANCE CORPORATION FUND STATUS OF PROGRAM The Federal Crop Insurance Corporation (FCIC) is a wholly owned government corporation created February 16, 1938 (7 U.S.C. 1501.) The program was amended by Public Law (P.L.) 96-365, dated September 26, 1980, to provide for nationwide expansion of a comprehensive crop insurance plan. FCIC i administered by the Risk Management Agency (RMA), and promotes the national welfare by improving the economic stability of agriculture through a secure system of crop insurance. Current Activities: There were over 1.1 million policies written in crop year 2009 with over $8.9 billion in premium, and indemnities projected at about $5.9 billion. Crop insurance is available for more than 350 different commodities in over 3,141 counties covering all 50 states, and Puerto Rico. RMA continues to pursue initiatives to make higher levels of crop insurance protection more affordable an useful to producers, provide better protection to farmers experiencing multi-year losses, expand risk management education opportunities, stimulate development of new risk management products, and improve program integrity. Pilot Programs are currently being implemented. RMA has 23 active pilot programs and 12 programs developed by private parties or persons submitted to FCIC under section 508(h) of the Federal Crop Insurance Act (FCIA). FCIC published proposed and final rules to convert the Cabbage pilot program to a permanent program. Proposed rules are being prepared for the Avocado (Florida), Forage Seed, and Processing Chili Pepper pilot programs to convert them to permanent programs. Pasture, Rangeland, and Forage Pilot Programs reflect changes implemented by RMA to its pilot Grou Risk Protection risk management programs for pasture, rangeland, and forage (PRF). Pilot programs that are based on vegetation greenness and rainfall indices were updated to better meet the needs of livestock producers who purchase insurance protection for losses of forage produced for grazing or harvested for hay, and were based on feedback RMA gained during the initial years of the pilot programs. In 2009, there were 15,369 vegetation and rainfall policies sold covering nearly 41 million acres of pasture, rangeland and forage. There was over $534 million in liability and almost $42 million in indemnities paid to livestock producers who purchased coverage. New Privately Developed Programs were approved by the FCIC Board of directors. The privately submitted 508(h) products included Apiculture – Rainfall and Vegetation Index, Processing Pumpkins, Group Risk Plan for Oysters and Group Risk Plan for Sugarcane. The Reinsurance Program included 17 approved insurance companies and the Commonwealth of Puerto Rico's plan of operations for the 2009 reinsurance year. In response to changes dictated by the 2008 Farm Bill, RMA developed and then issued a mandatory amendment to the Standard Reinsurance Agreement. Approved insurance providers were required to sign the amendment to be effective for the 2009 reinsurance year. Among the key changes included in the amendment were (a) reductions in the Administrative and Operating subsidies provided to approved insurance providers for delivering the crop insurance program; (b) a reduction in the CAT loss adjustment expense allocation; (c) a controlled business provision, which curtailed certain activities of some agents and policyholders to circumvent rebating prohibitions; and (d) the removal of references to the Premium Reduction Plan, which had been eliminated by the 2008 Farm Bill. 119 23g-6 National Outreach Program initiatives were implemented to increase awareness and service to small and limited resource farmers and ranchers and other underserved groups and areas. Partnership agreements provided a venue for public and private agricultural organizations, land grant universities, community based organizations, farmers and ranchers and other stakeholders to identify, develop and promote successful risk management strategies that small and limited resource farmers and ranchers can utilize to remain economically viable in a rapidly changing agricultural environment. FCIC is also partnering with community-based organizations, 1862, 1890, 1994 land grant colleges and universities, and Hispanic Serving Institutions (HSIs) to provide technical program assistance and risk management education on strategies associated with legal, production, marketing, human resources, and labor risks. FCIC funded 65 projects in FY 2009 totaling more than $7.1 million to provide outreach and assistance to women, small limited resource farmers and ranchers. Risk Management Education Programs focused on underserved states, specialty crop producers, and grants through the National Institute of Food and Agriculture (NIFA). Commodity partnership agreements, including small sessions, focused on specialty crops totaling $6.4 million and were executed with State Departments of Agriculture, universities, grower groups, non-profit organizations, and profit organizations. In addition, efforts continued with the Future Farmers of America organization to educate and encourage youth participation in the agriculture. Program Compliance and Integrity activities, through combined efforts between RMA, FSA and the Approved Insurance Providers, continued to improve through: 1) data reconciliation and matching for disaster program payments; 2) evaluating and amending procedures for referring potential crop insurance srrors or abuse between FSA and RMA; and 3) creating anti-fraud and loss adjustment training packages as required by FCIA. FCIC continued to improve efforts to integrate other data mining projects; explore avenues to expedite the processing of sanction requests; and implement the new Compliance Activities and Results System (CARS) for case management, tracking, and reporting compliance findings. The formalized alliance with FSA, along with data mining and analysis, greatly improved referral activity to and from the Agency. This is attributable to the greater emphasis placed upon deterrence and prevention efforts. - Comprehensive Information Management System (CIMS) provides a single centralized storage for common producer reported information and creates efficient services to share information. CIMS facilitates reporting of program participation data leading to reduced reporting errors; data redundancy; storage/processing costs; fraud and abuse vulnerabilities; and improve overall program integrity. The CIMS system is loaded weekly with over 500 million records of FCIC and FSA nationwide producer and crop acreage information for 2005 thru 2009. Approved USDA users can utilize 15 web applications to access available data. The CIMS process builds data marts of differences between FCIC and FSA producer reported data on entity/business type and crop acreage. These differences will be made available to the responsible program authority for reconciliation using current program authorities, processes, and procedures, In 2009, CIMS greatly extended access and data availability. The Approved Insurance Providers (AIPs) were provided a computer interface to request geographical land, FCIC, and FSA information. By making this data available through automated means, AIPs are able to process claims quicker, strengthen program integrity with increased data validation, and facilitate information sharing by using common references, 120 23g-7 IT Modernization Project (ITM) is reengineering and redesigning technology systems and processes to allow for easier addition of additional insurance products, provide more and better information to the producers and Approved Insurance Providers (AIPs) for policy determination and servicing, allowing for more robust actuarial analysis, and increased data analysis to support program integrity. A two phased approach for the ITM project is being executed. Phase I inchudes all processes needed to implement rate and price development and filing of insurance offers, edit and validation of data submitted by approved insurance providers, and enhanced reporting capabilities. Phase I development will complete around June 2010 to support implementation of the Combination (COMBO) policy for the 2011 crop year. Phase II will include accounting, exception processes, and the remainder of the corporate reporting system, and is scheduled for production in 2011 J. RMA has strengthened information security to protect producer and corporate information. Significant security enhancements implemented include data encryption for all RMA laptops, more secure remote access into RMA networks, additional policies and security controls, and working with AIPs to protect critical information throughout the insurance process. Selected Progress Examples: Agricultural Management Assistance funds, in the amount of $6 million, were used, in part, to operate the 2009 Financial Assistance Program (FAP) for producers in sixteen targeted States. Specifically, the funding was used to provide financial assistance of $150 per eligible policy for producers purchasing crop insurance in 2009 in those States. The remaining balance of $2.5 million was used to further the missions of the Risk Management Education and Outreach Programs for RMA. - - Standard Reinsurance Agreement (SRA) Negotiations are underway. RMA recently met with industry representatives and presented findings on company profitability. The Agency has received, reviewed, and considered recommendations and comments from the insurance industry, analyzed various Office of General Counsel (OGC) and Office of Inspector General (OIG) reports, and briefed Congress. RMA finalized and released the first draft of the 2011 SRA during the first week of December 2009, SRA negotiations are an iterative process of draft documents, explanatory meetings, comment periods and document revisions. The process must be completed by June 30, 2010 to be in effect for the 2011 reinsurance year beginning July 1, 2010, - - Combined Policy (Combo) Regulations and Provisions are being amended. FCIC published a Proposed Rule in the Federal Register to amend the Common Crop Insurance Regulations, Basic Provisions, Small Grains Crop Insurance Provisions, Cotton Crop Insurance Provisions, Coarse Grains Crop Insurance Provisions, Malting Barley Crop Insurance Provisions, Rice Crop Insurance Provisions, and Canola and Rapeseed Crop Insurance Provisions to provide both revenue protection and yield protection. FCIC also proposed to amend the Common Crop Insurance Regulations, Basic Provisions to incorporate changes resulting from input and recommendations by the prevented planting work group. The final rule is expected to be published early in 2010 for implementation for the 2011 crop year. The amended provisions will replace the Crop Revenue Coverage (CRC), Income Protection (IP), Indexed Income Protection (IIP), and the Revenue Assurance (RA) plans of insurance. . . . . . • .. When implemented, producers will have a choice of revenue protection (protection against loss of revenue caused by low prices, low yields, or a combination of both) or yield protection (protection for production losses only) within one Basic Provisions and the applicable Crop Provisions. This will reduce the amount of information producers must read to determine the best risk management tool for their operation and to improve the prevented planting and other provisions to better meet the needs of insured producers. This combined policy is expected to cover nearly $76 billion of the nearly $90 billion of FCIC’s total liability and 94 percent (approximately one million policies) of all policies earning premium. 121 23–19 RISK MANAGEMENT AGENCY Summary of Budget and Performance Statement of Goals and Objectives The primary responsibility of the Risk Management Agency (RMA) is to administer the Federal Crop Insurance Program in accordance with the Federal Crop Insurance Act (7 U.S.C. 1501 et seq.) as amended. The Risk Management Agency was established in 1996 by the United States Department of Agriculture (USDA) to improve the economic stability of agriculture through a sound system of crop insurance and to provide the means for the research and experience that is helpful in devising and establishing such insurance. The mission of the agency is to promote, support, and regulate sound risk management solutions to strengthen and preserve the economic stability of America’s agricultural producers. RMA provides an actuarially sound risk management program that protects against agricultural production losses due to unavoidable causes such as drought, excessive moisture, hail, wind, hurricane, tornado, lightning, and insects. In addition to these causes, revenue insurance programs are available under which producers of certain crops are protected against loss of revenue stemming from low prices, poor yields, or a combination of both. Federal crop insurance is available to producers through private insurance companies that market and service policies and also share in the risk. Thus, the program deliv Federal government and the private insurance industry. - ery is a joint effort between the RMA has one strategic goal and four strategic objectives that directly support the achievement of USDA Priority Goal: USDA will assist rural communities to create wealth so they are self sustaining, repopulating and economically thriving; USDA Objective 2.3: Provide Risk Management and Financial Tools to Farmers and Ranchers. Ensure effective oversight of the Crop Insurance industry and enhance deterrence and prosecution of fraud, waste, and abuse. USDA Priority - - Programs. Goal Agency Strategic Agency Objectives that Key . Goal Contribute | Outcome USDA will assist | Goal: Preserve Objective 1.1: Increase the Federal Key rural and strengthen the availability and effectiveness of Crop Outcome: communities to economic stability | risk management solutions. Insurance 1.1: create prosperity of America’s Increase so they are self agricultural Objective 2.1: the Sustaining, producers by Improve and protect the normalized repopulating and promoting and soundness, safety, efficiency and value of economically supporting the use effectiveness of the risk risk thriving. of sound risk management delivery system. protection - management tools provided to among farmers and Objective 3.1: - agriculture ranchers. Ensure customer and stakeholders producers have knowledge and awareness of through risk management tools and FCIC M products. sponsored insurance Objective 4.1; ($Billions) 122 23-20 Key Outcome 1.1: Increase the normalized value of risk protection provided to agriculture producers through FCIC sponsored insurance ($Billions). HPPG Measures: The three performance measures for Secretary’s Priority Goal 1 are: (1) reduce rejection rate of policy records, (2) estimated total savings due to large claim reviews, and (3) total small and limited resources farmers and ranchers reached through outreach initiatives. Long-Term Performance Measure: Increase the number of crop insurance or non-insurance risk management tools that address Pasture, Rangeland and Forage production needs. Selected Past Accomplishments toward Achievement of the Key Outcome: In August of 2006, RMA announced two Pasture, Rangeland and Forage (PRF) programs at the Beef Cattle Short Course held at Texas A&M University. The PRF Vegetation Index Program and the PRF Rainfall Index Program have been piloted in select counties in nine States. Selected Accomplishments Expected at the FY 2011 Proposed Resource Level: RMA is submitting an FY 2011 budget that addresses the need to modify the crop insurance program to create less reliance on disaster insurance includes support to provide viable insurance products and tools, maintain an effective delivery system, and support oversight of the crop insurance industry. This budget includes necessary staffing and information technology requirements to ensure the crop insurance program continues to be a primary system of support to producers when natural disasters strike. Efficiency Measure: N/A 123 23-2 i RISK MANAGEMENT AGENCY Summary of Budget and Performance Key Performance Outcomes and Measures Discussion of Key Performance Proposals: In FY 2011, RMA will continue its efforts to increase the availability and effectiveness of risk management solutions. RMA is currently in the process of soliciting for contracts for research and development of developing an insurance product for dedicated energy crops, poultry and apiculture, as well as a review of skip row cropping practices in keeping with the provisions of the Farm Bill. The FY 2011 budget request includes funding to support these activities. Also included are requests to support Information Technology (IT) Modernization, Architecture, Infrastructure, and Information Sharing. RMA proposes to enhance product delivery by promoting good farming practices. RMA will continue to strengthen program integrity and compliance. In order to meet the requirements of the Improper Payment Act, establish and update a program error rate, and better monitor the Federal crop insurance delivery system, RMA seeks to improve a system of recurring reviews of insurance provider operations, while at the same time continuing with other compliance initiatives to provide greater assurance in the integrity of the crop insurance delivery system. Additionally, RMA seeks to continue investing in data analysis tools of data mining, and remote sensing of crop insurance data that have proven to be extremely useful in detection of possible instances of fraud, waste, and abuse. To enhance program delivery systems, decision-making, and performance budgeting capabilities, RMA proposes IT modernization that will update its information technology systems and create a more corporate style database and communication system to provide automated, timely, and complete data for decision making and information sharing while enhancing data security. Initiatives in the administrative infrastructure contribute significantly to supporting the Agency’s mission and strategic goal and objectives. RMA also is integrating the Secretary's High Priority Goals and strategic/operational Performance Goals into its planning and management cycles. Attention to these elements will result in RMA usage of valuable resources to improve upon the agency conformity with Departmental guidelines and the OMB guidance. Key Performance Targets Performance 2006 2007 2008 2009 2010 2011 Measure Actual Actual Actual Estimate Target Target #1 — Increase the normalized value of FCIC risk protection coverage provided $48.7B $50.6B $51.6B $51.4B $51,9B $52.4B through FCIC sponsored insurance ($Billions) Mandatory and discretionary funding $2.3B $3.4B $4.5B $4.9B $6,2B 7.3B associated with measure ($Billions) Discretionary IT Funding $15.1M $19.6M $17.1M $13.7M $13.7M 18.6 M ($ Millions) 124 23-22 Performance Measure 2006 Actual 2007 Actual 2008 Actual 2009 Estimate 2010 Target 2011 Target #2 – The number of crop insurance or non-insurance risk management tools which address pasture, rangeland and forage production needs - Mandatory and discretionary funding associated with InéâSurº $0.8M $0.8K $1.5M $1.8M $1.8M $1.4M #3 – The number of pilot programs evaluated for potential conversion from pilot program to permanent program Status Mandatory and discretionary funding associated with $3.0M $3.0M $3.0M $4.0M $3.0M $0.2M measure ($Millions) #4 – Crop Insurance participation rate for the ten staple crops Mandatory and discretionary funding associated with IºaSłlſº 79.5% $2,926/$1B In liability 77.0% $2,713/$1B In liability 79.8% $2,521/$1B in liability 80.5% $2,390/$1B in liability 81.0% $1,549/$1B in liability 81.5% $1,470/$1B in liability #5 – The number of producers reached through Commodity Partnership and Targeted States Cooperative Agreements Mandatory and discretionary funding associated with measure ($Millions) 48,000 $15.0M 48,720 $14.0M 49,451 $14.0M 25,000 $15.0M 50,193 $15.0M 57,000 $15.3M 125 23-23 Performance Measure 2006 Actual 2007 Actual 2008 Actual 2009 Estimate 2010 Target 2011 Target #6 – The number of operational reviews conducted of insurance companies receiving funding through FCIC Mandatory and associated with HºàSURIC discretionary funding $97,0K $62.0K $90.0K $85.0K $1 | 1.4K $116.0K #7 – The number of program reviews of insurance providers receiving funding through FCIC Mandatory and discretionary funding § associated with measure ($Millions) $3.0M $1.4M $1.7M $1.7M $1.8M $1.9M Performance Measure 2006 Actual 2007 Actual 2008 Actual 2009 Estimate 2010 Target 2011 Target 1 - Reduce rejection ate of policy records a. Units b. Dollars Not Available Not Available Not Available Not Available 6% 6% 2 - Estimated total vings due to large laim reviews a. Units b. Dollars Not Available Not Available Not Available Not Available $16.8 $16.8 3 — Total small and imited resources farmers dranchers reached ough outreach initiatives a. Units b. Dollars Not Available Not Available Not Available Not Available 50,000 75,000 126 23-24 RISK MANAGEMENT AGENCY Summary of Budget and Performance Full Cost By Department Strategic Goal Department Strategic Goal: USDA will assist rural communities to create prosperity so they are self sustaining, repopulating and economically thriving. PROGRAM PROGRAM ITEMS Federai Crop Insurance Corporation Fund Agricultural Risk Protection Act Initiatives Premium Program A&O Expenses/Delivery Expenses Risk Management Assistance Program Excess Crop Losses Projected Savings from Negotiations of SRA - Total Costs Administrative and Operating Expenses Administrative Costs (direct) Information Technology Total Costs FTEs Performance measure: Increase the normalized value of FCIC risk protection coverage provided through FCIC sponsored insurance (in billions) BY Performance Cost per measure (unit cost) Total for Department Strategic Goal Total Costs for Department Strategic Goal FTES FY 2009 FY 2010 FY 2011. AMOUNT AMOUNT AMOUNT ($000) ($000) ($000) 47,371 68,500 68,50ſ 8,416,173 7,669,250 9,040,243 1,601,807 1,567,145 1,683,633 6,000 6,000 6,000 1,962,597 1,167,759 1,204,77. {} - 0 –782,00ſ 12,033,948 H0,478,654 i 1,221,14 63,606 66,754 67,4 13,571 13,571 15,5 77,177 80,325 83,0 48] 568 56 $53.7 $54,8 $50. N/A N/A N/ 12,111,125 10,558,979 11,304,21 481 568 56 127 FY 2011 Explanatory Notes Commodity Credit Corporation Table of Contents Page Purpose Statement.…......…...…..........…........................................…. 24-f Statement of Available Funds........................................................................... st s s sº sº a 4 sº e is a e s tº * * * * * * * * * * * * * * * * * * * * * * * * * 24-16 Classification by Objects................... * * * * * g c tº g º f * * * * * * * * * * * * * * * * * * * * * tº a tº * * * * * * * * * * * g : * * * * * * * * * * * * g e º f it is ºr ºf e = w is e º º tº t t w is as º ºs s e º e s m º º e < * * * * * * * * * 24-17 Net Realized Losses Appropriations Language....... tº e = * * * * * * * * * * > * > * * * * * * * * * * * * * * * * * * * p * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * w ºf s is is e g × < * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * 24-18 Lead-off Tabular Statement........................................................................................... * * * * * * * * * * * * * * * * * * * 24-19 Project Statement …..........…...........….....…. 24- 9 Farm and Sugar Storage Facility Loan Programs Lead-off Tabular Statement.............................................................................................................. 24–24 Project Statement ........... * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * 24-25 Geographic Breakdown of Obligations......................................................................... § & & R e º 'º y * * * * * j, a 4 & 4 tº a 24-26 Classification by Objects.................…............................................................................................. 24-27 Commodity Credit Corporation Status of Program....................................................................... * * * * * * * * * * * 24g-l 128 24-l COMMODITY CREDIT CORPORATION Purpose Statement The Commodity Credit Corporation (CCC or Corporation) is a wholly-owned Government corporation created in 1933 under a Delaware charter and reincorporated June 30, 1948, as a Federal corporation within the Department of Agriculture by the Commodity Credit Corporation Charter Act, approved June 29, 1948 (15 U.S.C. 714). CCC assists in stabilizing, supporting, and protecting farm income and prices, helps to maintain balanced and adequate supplies of agricultural commodities, helps in the orderly distribution of these commodities, and assists in the conservation of soil and water resources. The goal is to promote economic stability in the farm sector through an approach that supports farm income and facilitates prices that are reasonable to consumers and competitive in world markets, while retaining basic management responsibilities of farmers and minimizing Federal interference in the agricultural economy. Management of the Corporation is vested in a board of directors, subject to the general supervision and direction of the Secretary of Agriculture, who is an ex-officio director and chairman of the board. The board consists of seven members, in addition to the Secretary. Various Department of Agriculture officials are ex-officio officers of the Corporation. The activities of the Corporation are carried out mainly by the personnel and through the facilities of the FSA and the FSA State and county committees. The Foreign Agricultural Service (FAS), the Natural Resources Conservation Service (NRCS), and other agencies and offices of the Department, and commercial agents also carry out certain phases of the Corporation's activities. With respect to FSA-administered CCC programs, FSA utilizes its headquarters offices in Washington, D.C. and Kansas and FSA State and county offices There are 50 State offices, an insular area office in Puerto Rico, and approximately 2,248 county offices Similarly, NRCS-administered programs are carried out through the national office of NRCS and its nationwide office structure. CCC activities carried out by FAS require the use of the FAS headquarters office and agricultural attaches focated throughout the world. - - Historically, the principal operations conducted by CCC related to the operation of price and income support programs for producers of agricultural commodities. While the CCC Charter Act provides broad authority with respect to the support of U.S. Agriculture, the majority of CCC activities are those that the Corporation is required to implement under various statutes, such as the Food, Conservation, and Energy Act of 2008 (the 2008 Farm Bill). Operations of the CCC include: Buying Donating Transporting Crop loss protection Seiling Lending Making Payments Bartering Storing Conservation Operations In addition, a significant amount of CCC funds are expended in the operation of numerous conservation programs, principally under the Food Security Act of 1985 Most of these conservation programs are administered on behalf of CCC by NRCS, CCC is the principal source of funds for the international activities of the Department of Agriculture. Under the CCC Charter Act and other acts, most notably the Agricultural Trade Development and Assistance Act of 1954 (P.L. 480) and the Agricultural Trade Act of 1978, the Corporation provides assistance in the development of international markets and provides guarantees to facilitate the financing of goods and Services exported from the United States to improve or establish agriculture-related facilities in emerging markets, and storage, handling, and disposition of commodities acquired under the various programs. CCC funds, and CCC-acquired commodities, are also used with respect to the administration of developmental programs in foreign countries. - CCC-owned commodities are also available for use in the administration of domestic nutrition and feeding programs administered by the Food and Nutrition Service. 129 24-2 FINANCING The Corporation has an authorized capital stock of $100 million held by the United States, with the uthority to have outstanding borrowing of up to $30 billion at any one time. Its capital structure is eplenished each year by appropriations to restore net realized losses on support operations and to eimburse costs of other programs. Borrowing Authority 'unds are borrowed from the Treasury and may also be borrowed from private lending agencies and others. The Corporation maintains a sufficient amount of its borrowing authority to purchase at any time all notes ind other obligations evidencing loans made by such agencies and others. All bonds, notes, debentures, and imilar obligations issued by the Corporation are subject to approval by the Secretary of the Treasury as equired by the Act of March 8, 1938 (15 U.S.C. 713a–4). Reservation of borrowing authority for these jurposes has not been required for many years. - nterest on borrowings from the Treasury (and on capital stock) is paid at a rate based upon the average nterest rate of all outstanding marketable obligations (of comparable maturity date) of the United States as if the preceding month. Interest may also be paid on other notes and obligations at a rate prescribed by the orporation and approved by the Secretary of the Treasury. he Department of Agriculture and Related Agencies Appropriations Acts of 1966 made provision for rminating interest after June 30, 1964 on the portion of the Corporation’s borrowings from the Treasury qual to the unreimbursed realized losses recorded on the books of the Corporation after the end of the Scal year in which such losses are realized. ** Contract Authority support and other programs required by statute may result in the Corporation's incurring obligations in xcess of available funds or borrowing authority. Such obligations are liquidated from subsequent ppropriations and other funds that may become available to the Corporation. Any increase in obligations n excess of available fund resources is reported as contract authority in the year involved; a decrease is eported as the application of appropriations and other funds to liquidate the contract authority Appropriations &eimbursement for Net Realized Losses Under Section 2 of Public Law 87-155, the Act of August 17 1961 (15 U.S.C. 713a-1 l), annual appropriations are authorized for each fiscal year, ommencing with FY 1961, to reimburse the Corporation for net realized losses. The Omnibus Budget teconciliation Act of 1987 amended Public Law 87-155 to authorize that the Corporation be reimbursed for is net realized losses by means of a current, indefinite appropriation. However, the Corporation has ontinued to be reimbursed by annual appropriations for net realized losses sustained, but not previously eimbursed, except under the enactment of the FY 2000 Appropriations Act. The FY 2000 Appropriations Act, P.L. 106-78, authorized a current, indefinite appropriation up to the amount of actual losses reflected n the books of the Corporation as of the close of the immediately preceding fiscal year. The FY 2002, 003, 2004, 2005, 2006, 2007, 2008, 2009, and 2010 Appropriations Acts, P.L. 107-76, P.L. 108-7, P.L. 08-199, P.L. 108-447, P.L. 109-97, P.L. 110-5, P.L. 110-161, P.L. 111–8, and P.L. 111–80 respectively, uthorized the Corporation to be reimbursed for net realized losses sustained, but not previously eimbursed, pursuant to section 2 of the Act of August 17, 1961 (15 U.S.C. 713a-11). The FY 2011 ppropriations Act is not anticipated to depart from this process. 130 24-3 CCC Export Credit Guarantee Liquidating Account. Under the Budget Enforcement Act of 1990, Title X}} of the Omnibus Budget Reconciliation Act of 1990, a permanent, indefinite appropriation for the Corporation's Export Credit Guarantee Programs (GSM-102 and GSM-103) is authorized to cover the obligations and commitments of pre-fiscal year 1992 guarantees. Therefore, Export Credit Guarantee Program activity is no longer financed through CCC borrowing authority. - - CCC Export Credit Guarantee Program Account. Under the Budget Enforcement Act of 1990, Title XIII o the Omnibus Budget Reconciliation Act of 1990, a permanent, indefinite appropriation for the Corporation's Export Credit Guarantee Programs (GSM-102, including Facilities Financing) is authorized to cover the subsidy costs of the current year's program. The FY 2011 appropriation estimate represents the present value of CCC's estimated net cash flows over the lifetime of the credit guarantees to be made in FY 2011. A current, definite amount is appropriated by Congress for the administrative costs of carrying out the export guarantee programs. Therefore, CCC borrowing authority is not used. Hazardous Waste Management Program. Legislation affecting this program includes the Safe Drinking Water Act and the Comprehensive Environmental Response, Compensation, and Liability Act, CCC conducted a grain storage program from the 1930's to the early 1970's. At its peak during the 1950's, CCC operated grain storage facilities on leased property at approximately 4,500 locations nationwide. During this period, some of the grain was authorized for fumigation using carbon tetrachloride to control destructive insects. In 1985, use of carbon tetrachloride was prohibited and the EPA assigned a maximum allowable contaminant level. Since that time, over 50 former CCC grain bin sites have been found to have carbon tetrachloride ground water contamination levels exceeding the EPA maximum. From FY 1992 through FY 2003, CCC received annual funding from the USDA Hazardous Waste Management Fund to conduct its own investigations. For FY 2003 and FY 2004, USDA funding was greatly reduced and for FY 2005 and FY 2006 no funding was provided, therefore CCC has relied more on its Section l i - borrowing authority to conduct both operation and maintenance of existing treatment systems as well as remedial actions. In FY 2009 $4.8 million was provided for reimbursable agreements through Section 1, and this amount increased in FY 2010 to the statutory cap of $56.1 million CCC is authorized to use its borrowing authority, not to exceed $5 million, for site investigations, ongoing operations and maintenance and remediation expenses. COMMODITY PROGRAMs CCC provides loans, purchases, and payments along with other programs in order to support farm income and prices and stabilize commodity markets. These actions are authorized under the Commodity Credit Corporation Charter Act, as amended, the Agricultural Act of 1949, as amended, and the Farm Security and Rural Investment Act of 2002 (2002 Farm Bill). CCC is required to support the price of dairy products. Marketing assistance loans are required to be available for wheat, feed grains, cotton, long grain and medium grain rice, soybeans, minor oilseeds, pulse crops, honey, wool and mohair at levels provided for by law. Pulse crops inchude both large and small chickpeas CCC has to make an offer, open to all producers, to make loans upon or purchase any quantity of these commodities produced which meet eligibility requirements. Eligibility requirements include grade. moisture content, adequacy of storage, and compliance with conservation use provisions. Income support in the form of direct and counter-cyclical payments is required by law to be available to growers of feed grain, wheat, upland cotton, soybeans, minor oilseeds, peanuts and rice. The 2008 Farm Bill adds the Average Crop Revenue Election (ACRE) program as an alternative to counter cyclical payments and in exchange for a 20 percent reduction in direct payments and a 30 percent reduction in marketing assistance loans rates for all commodities produced on the farm except for seed cotton loans. The election to enroll a farm in ACRE.may be made for any of the crop years 2009-2012, but once the election is made, it is irrevocable through the 2012 crop. 131 24-4 CC has little control over the volume of loan business it must handle. The relationship of the market price or each commodity to the loan rate largely determines the volume of that commodity which will be placed nder loan or acquired by the CCC. Price, in turn, is determined by weather conditions, insect damage, use f fertilizers, existing supplies, domestic and export demand, and all other factors influencing production nd affecting the market Dispositions of inventory are governed by the same set of economic factors. hese circumstances can cause tremendous variations over relatively short periods in the volume of CCC ommodity loan and related operations. The following paragraphs highlight specific commodity activity. JSDA has incorporated stochastic price and production variability into its 10-year budget baseline process tarting with the FY 2007 President's Budget. For the 2010-2020 crops, CCC outlay projections for ounter-cyclical payments, marketing loan benefits, and milk income loss contract payments are based on rice probability distributions and flexibilities generated by the Economic Research Services' Food and gricultural Policy Simulation model. This approach was used for feed grains (corn, barley, sorghum, ats), wheat, rice, upland cotton, soybeans, sugar and dairy. airy program Dairy qualifies for milk price supports and dairy market loss payments. The 2008 Farm ill replaces the price support program of the 2002 Farm Bill with the Dairy Product Price Support rogram, which is effective for calendar years 2008-2012. It requires the Secretary to support the price of heddar cheese, butter and nonfat dry milk through purchases of such products at prices not less than $1.13 er pound for cheddar cheese in blocks, not less than $1.10 per pound for cheddar cheese in barrels, not less an $1 05 per pound for butter, and not less than $0.80 per pound for nonfat dry milk. Purchase prices for ilk products may be adjusted lower based on preset levels of product net removals. The 2008 Farm Bill tends the Milk Income Loss Contract (MILC) Program through September 30, 2012. The payment lculation percentage is raised from 34 to 45 percent and the payment quantity is raised from 2,400,000 to ,985,000 million pounds per fiscal year effective October 1, 2008 through August 31, 2012. A feed cost djuster is added that raises the $16.94 base price when the national average ration cost exceeds $7.35 per undredweight for a given month. - obacco program. The American Jobs Creation Act of 2004, P.L. 108-357 eliminated the program ffective with the 2005 crop. In return for termination of the program, growers and quota holders received “buyout " The owner of quota is being paid $7 per pound for the quota they hold The actual producer is Bing paid $3 per pound for quota they produced The legislation eliminated all geographic and poundage strictions on tobacco production as well as price support. The buyout cost is funded by assessments on e tobacco product manufacturers and importers. The program will cost $10.14 billion and the growers d quota holders will be paid over a 10-year period anut price support program Under the 2008 Farm Bill, peanuts qualify for ACRE or direct payments, Dunter-cyclical payments, marketing assistance loans and loan deficiency payments for the 2009 through 912 crops. - he 2002 Farm Bill terminated the marketing quota programs and repealed price support programs. The ior quota programs remained in effect for the 2001 crop only, with payments being made during fiscal ears 2002 through 2006. This legislation also established marketing assistance loans for the 2002 through 907 crops, with a loan rate of $355 per ton. The payment rate is the amount by which the established loan te exceeds the rate at which a loan may be repaid. The Farm Bill also required that for crop years 2002 ough 2006 CCC pay storage, handling, and other associated costs to ensure proper storage of peanuts for hich a loan is made. This authority terminated beginning with the 2007 crop year but was reinstated for e 2008 crop year by the 2008 Farm Bill, which continues the marketing assistance loans for peanuts in the 08-2012 crop years. gar program Sugar qualifies for price support The 2002 Farm Bill extended the national average sugar n rates to cover through the 2007 crops at 18 cents per pound for raw came sugar and 229 cents per jund for refined beet sugar Loans are available to processors of domestically grown sugarcane and sugar 132 24-5 beets for a term of nine months that fall within one fiscal year. The non-recourse loans are available through the 2007 crop for processors of domestically produced sugar beets and sugarcane including for in- process sugar. Loans for in-process sugar have a loan rate of 80 percent of the loan rate for raw cane Sugal or refined beet sugar (based on the source material used). If forfeitures occur, the processor shall convert the in-process into final product at no cost to the CCC. Upon transfer, the processor will receive payment based on the loan rate less 80 percent of raw cane or refined beet sugar rate times the quantity of Sugar transferred. The 2008 Farm Bill extends the marketing allotment provisions of the 2002 Act, except they are now permanent and cannot be set at a level less than 85 percent of estimated sugar deliveries for humar consumption. The 2008 Farm Bill introduces the Feedstock Flexibility Program, which requires the diversion of sugar from food use to ethanol producers, if needed, to keep sugar prices above levels at whicl Sugar processors might otherwise forfeit sugar under loan to the CCC. If the program is managed correctly CCC will purchase surplus and preempt any forfeitures. Non-Insured Assistance Program (NAP). The Federal Crop Insurance Reform Act of 1994, P.L. 103-354, removed the authority in the Agricultural Act of 1949 for disaster payments and expanded crop insurance authorities to provide for catastrophic coverage at 50 percent yield protection at a flat fee f crops currently covered by insurance programs. Farmers are able to pay an additional premium to increase coverage. Where crop insurance coverage is not available through the Risk Management Agency, producers of crops for food and fiber and certain other crops are covered under NAP, which is financed by CCC and operated through the FSA. The program reimburses producers at the same rates and terms as the catastrophic crop insurance program. Payments to Producers: Direct Payments and Counter-Cyclical Payments The 2002 Farm Bill rescinded production flexibility contracts and established direct and counter-cyclical payments for May 2002 through 2007. The eligible commodities for both direct payments and counter-cyclical payments are wheat, corn, grain sorghum, barley, oats, upland cotton, rice, soybeans, other oilseeds, and peanuts. The 2008 Farm Bill adds long grai and medium grain rice and large chickpeas as eligible commodities. - Counter-cyclical payments are made to producers for eligible commodities for which payment yields and base acres are established if it is determined that the effective commodity price is less than the target commodity price. Counter-cyclical payments are made for the crop as soon as practicable after the end of the 12-month marketing year for the eligible commodity. If, before the end of the 12-month marketing yea it is determined that counter-cyclical payments will be required for the eligible commodity, producers will be provided the option to receive partial payment of the projected counter-cyclical payment. Direct payments are made to producers for eligible commodities for which payment yields and base acres are established. The commodity payment amount is calculated as follows: Payment Amount = specified rate x payment acres x payment yield. The producer can choose to receive advance payments (up to 50 percent) during the producer's selected month, which may be any month during the period beginning o December 1 of the calendar year before the calendar year in which the crop of the covered commodity is harvested through the month within which the direct payment would otherwise be made. The Deficit Reduction Act of 2005, P.L. 109-171, signed February 8, 2006, amended the 2002 Farm Bill by authorizin advance direct payments for covered commodities of up to 40 percent of the direct payment for the 2006 crop year and up to 22 percent for the 2007 crop year. The 2008 Farm Bill continues the 2002 Farm Bill payment rates; however, payment acres decrease from 85 to 83.3 percent of base acres for 2009-2011 crop and no advance payments are available for the 2012 and subsequent crops. Average Crop Revenue Election (ACRE) Payments. The 2008 Farm Bill adds the ACRE program for the 2009-2012 crop years. Producers who elect to enroll a farm in ACRE are eligible for ACRE payments in lieu of counter-cyclical payments on the farm and in exchange for a 20 percent reduction in direct payments on the farm and a 30 percent reduction in the marketing assistance loan rates for all commodities 133 24-6 roduced on the farm except that the loan rate for seed cotton loans will not be so reduced. The election to nroll a farm in ACRE may be made for any of the crop years 2009-2012, but once the election is made, it S irrevocable through the 2012 crop. . . . . . Marketing Assistance Loans and Loan Deficiency Payments. The 2002 Farm Bill authorized non- ecourse marketing assistance loans to producers of each eligible loan commodity for 2002 through 2007. These loans have a term of 9 months beginning on the first day of the first month after the month in which he loan is made, and they cannot be extended. The producer must comply with applicable conservation quirements under subtitle B of title XII of the Food Security Act of 1985 and applicable wetland rotection requirements under subtitle C of title XII of the Act during the term of the loan. roducers of eligible commodities can repay a marketing assistance loan at a rate that is the lesser of the an rate established for the commodity plus interest; or a rate that the Secretary determines. Special rules pply to upland cotton, rice, and extra long staple cotton. New crops eligible for marketing assistance loans clude triticale, peas, lentiis, honey, wool, and mohair. Producers also have the option for most - ommodities to take loan deficiency payments in lieu of a marketing assistance loan when repayment rates re below the loan rate. - he 2008 Farm Bill establishes specific loan rates for long grain and medium grain rice and restricts loan te adjustments to grade and quality factors. Also, large chickpeas are added as a new marketing . ssistance loan commodity with a higher loan rate than small chickpeas. Market Loss Assistance for Asparagus Producers. The 2008 Farm Bill authorizes the use of $15 million ) make payments to 2007 crop asparagus producers. Of the total, $7.5 million will be available to fresh. paragus producers and $7.5 million will be available to frozen market asparagus producers. - he following table shows estimated CCC payments made directly to producers, assuming the provisions of he 2008 Farm Bill: 134 24-7 - - - - COMMODITY CREDIT CORPORATION Direct, Counter-Cyclical, ACRE, Production Flexibility, Marketing Loss Assistance, Loan Deficiency, Emergency Disaster, and Noninsured Assistance Payments Fiscal Years 2009–2011 (Thousands of Dollars) - 2009 2010 20 #1 . . . Actual Estimate. Estimate Total Production Flexibility Payments For all Commodities - v- $96 {} 0. Direct Payments: - - - Corn 2,110,027 $2,082,228 $2,007,400 Grain Sorghum 196,956 198,734 190,000 Barley 80,416 85,100 79, 100 Oats - 3,020 3,202 2,890. Total Feed Grains 2,390,419 2,369,264 2,279,390. Wheat 1,138,370 1,079,685 1,046,296 Upland Cotton 596,927 618,260 589,936 Rice 416,740 421,771 418,329 Peanuts 68,994 69,537 66,450 Soybeans 590,276 565,851 | 543,800 Other Oilseeds 20,211 19,902 18,692 Unidentified Commodity 388 0 0 Total 5,222,325 5,144,270 4,962,893 ACRE Payments: Corn 0 0. 64,300 Grain Sorghum 0 () 2,200 Barley 0 0 15,900 Oats 0 0. 1,300 Total Feed Grains 0 0 83,700 Wheat 0 0 307, 100 Small Chickpeas 0 0 60 Dry Peas 0 0 1,765 Soybeans 0 {} 38,500 Other Oilseeds 0 0. 7,130 Total 0 0 438,255 Counter-Cyclical Payments aſ: Grain Sorghum 3 0. 0 Barley -2 0 0 Total Feed Grains l {} 0 Wheat -3 () () Upland Cotton 727,795 1,194,093 675,632 Rice 35 {} 0 Peanuts 3,098 25, 112 62,780 Soybeans -8 0. - 0 Unidentified Commodity 169 0 0 Total 731,087 1,219,205 738,412 135 24-8 2009 20 || 0 20 | } Actual Estimate Estimate Market Loss Assistance Payments: Dairy - Milk Income Loss Contract - Payments. - - 756,889 225,000 100,000 Other Market Loss Asst Payments 0 15,000 - () Total - 756,889 240,000 100,000 Loan Deficiency Payments aſ: - Corn 25 0 0 Grain Sorghum 30 0 0 Barley 1,659 1,500 {) Total Feed Grains 1,714 1,500 () Wheat 4,031 }57,976 16,100 Upland Cotton 131, 166 | 2, #24 0 Rice 69 {} 0 Lentils -] 0 0 Dry Peas -8 0 {) Wool 6,228 4,896 4,908 Pelts 1, 191 1,334 1,389 Mohair 1,068 725 86 i Soybeans 39 0 () Total 145,497 178,555 23,258 Noninsured Assistance Payments 62,064 121,638 124,000 Crop Disaster Program: - Crop Disaster Payments } |4 {} 0. Emergency Livestock Asst Program. 32 0 0 Livestock indemnity Program 24 0. {} Total | 70 0 0 Other Programs: - Upland Cotton Econ Adjustment Asst 74,661 72,613 81,728 ELS Cotton Competitiveness Payments 9,630 1,394 0 Tobacco Payments 953,219 960,000 960,000 Tree Assistance Program 68 () 0 it. Total 1,037,578 1,034,007 1,041,728 Payments, Grand Total 7,955,706 7,937,675 7,429,546 a/ These estimates do not include stochastic add-ons. 136 24-9 EXPORT PROGRAMS Export Credit Guarantees. Under the short-term Export Credit Guarantee Program (GSM-102), CCC guarantees (for up to 3 years) payments due U.S. exporters, or their assignees (U.S. financial institutions), from defaults in payments by foreign banks on export credit sales due to commercial as well as noncommercial risks. Facility payment guarantees operate under the general provisions of the GSM-102 program and provide export financing for capital goods and services to improve handling, marketing, processing, storage, or distribution of imported agricultural products. - On July 1, 2005, the guarantee fees (premia) charged under the export credit guarantee programs were changed from a flat fee basis to a country risk-based approach. The revised premia respond to a World Trade Organization (WTO) dispute panel decision and are intended to remove any long-term subsidy component of the program, prospectively. Also in response to the panel decision, the GSM-103 intermediate export credit guarantee program was suspended on July 1, 2005. Both GSM-103 and the Supplier Credit Guarantee were repealed by Title III, Section 3101, of the Food, Conservation, and Energy Act of 2008, - - Total sales registrations in FY 2009 were $5.357 billion, all for the GSM-102 program. Total program level for FY 2011 is estimated to be $5.5 billion, including $5.4 billion for GSM-102 and $100 million for facilities guarantees. The program level for FY 2011 is only slightly higher than FY 2009. The 2011 budget continues to reflect credit reform procedures for Federal credit programs authorized by the Budget Enforcement Act of 1990, Title XIII of the Omnibus Budget Reconciliation Act of 1990. These procedures require that for guarantees issued since 1992, budget authority and outlays for these programs represent estimated subsidy costs over the life of the program, rather than claim disbursements and repayments. The appropriation language specifies the portion of the requested budget authority to be used for administrative expenses, which are funded via a discretionary annual appropriation. Budget authority for the subsidy represents the present value of CCC's estimated net cash flows over the lifetime of the credit guarantee. Budget authority and outlays for the subsidies are presented in the Budget in "loan program accounts." All claims disbursement and repayment activity related to loans made in FY 1992 or later appear in a "financing account" and are considered "off-budget" for purposes of estimating the deficit Budget authority and outlays for pre-FY 1992 portfolios of guarantees and claims are reflected in the budget in "liquidating accounts" and are calculated on a cash basis as before, to represent claim disbursements and borrower repayments. + - Direct Export Credit. Under the short-term export credit sales program, GSM-5, CCC may provide direct financing on terms not to exceed three years for the commercial sale of agricultural commodities from private stocks. There have been no sales under the direct credit program since FY 1985. CONSERVATION PROGRAMs Title II of the 2008 Farm Bill re-authorized funding for new and existing conservation programs implemented by FSA or NRCS. The bill provided funding through 2012 to help farmers adopt and maintain conservation systems that protect water quality, reduce soil erosion, protect and enhance wildlife habitat and wetlands, conserve water and sequester carbon. NRCS administers many of the programs that are financed through CCC, and detailed descriptions of program operations and performance indicators can be found under NRCS elsewhere in these Explanatory Notes. Conservation Reserve Program (CRP). CRP, administered by FSA, is USDA's largest conservation/environmental program. The purpose of CRP is to cost-effectively assist farm owners and operators in conserving and improving soil, water, air, and wildlife resources by converting highly erodible and other environmentally sensitive acreage normally devoted to the production of agricultural commodities 137 24-10 to long-term resource-conserving vegetative covers. CRP participants enroll acreage for periods of 10 to 15 years in exchange for annual rental payments, cost-share payments, and technical assistance for installing and maintaining approved conservation practices. - Established by the 1985 Food Security Act, CRP was amended and extended under subsequent farm bills. Most recently, the 2008 Farm Bill re-authorized CRP enrollment through September 30, 2012, decreased maximum CRP enrollment at any one time to 32 million acres beginning October 1, 2009, expanded Farmable Wetlands Program (FWP) eligibility, and included provisions for funding a tree thinning cost- share program and a transitions option. The transitions option is designed to encourage use of expiring CRP lands to assist beginning and socially disadvantaged farmers. CRP enrolls land through both general and continuous signups. Under general signup provisions, producers compete for acceptance nationally during specified enrollment periods based on an environmental benefits index. Continuous signup is reserved for high environmental impact small-footprint practices such as iparian buffers, filter-strips, and wetland restorations, and is noncompetitive. ost continuous signup enrollments are eligible for additional payments above and beyond payments made or general signup contracts. Most continuous practices receive annual incentives of up to 20 percent of he annual rental payment, plus an up-front signing incentive of $100/acre and a practice incentive equai to 0 percent of installation costs, payable when practice installation is complete. Continuous signup also ncludes: - • Conservation Reserve Enhancement Program (CREP). Under Federal-State partnerships covering up to 100,000 acres per State with 20 percent of funding provided by the State, producers enroll specific practices on a continuous basis. CREP enrollments receive continuous sign-up incentives, and most CREP agreements provide for additional financial incentives. - • Farmable Wetland Program. FWP enrollment is limited to 1 million acres across all States, was originally limited to small non-flood-plain wetlands and adjacent uplands, and also receives continuous signup incentives. The 2008 Farm Bill expanded eligibility to include aquaculture ponds, flooded farmland, constructed wetlands, and associated buffers. Between 2002 and 2008, USDA initiated several enhancements to continuous CRP designed to increase invironmental benefits by enrolling up to: • 500,000 acres of bottomland hardwood trees to enhance wildlife habitat, sequester carbon, protect water quality, and reduce flood damage; - - • 500,000 and 250,000 acres, respectively for restoration of floodplain and non-floodplain wetlands; • 250,000 acres of upland bird habitat buffers; • 100,000 acres to provide habitat for duck nesting in wetland complexes located in the Prairie Pothole region, - • 250,000 acres for restoration of longieaf pine ecosystems in the Southeastern U. S., and • 500,000 acres to restore habitat for high-priority wildlife species throughout the U S 3eginning in FY 2009, incentive payments similar to those provided for other continuous signup practices were established for the wetland restoration initiatives noted above. All the above initiatives now have imilar payment provisions. jeneral sign-ups were not held in fiscal year 2007,2008, or 2009. A contract extension for contracts that xpired September 30, 2009 was offered. Of the 1.5 million acres what were offered extensions, 1.1 million cres were extended. The baseline assumes a general signup will be held in fiscal year 2010 Under ontinuous signups, a total of 4.4 million acres were under contract as of the end of FY 2009. About 00,000 acres are projected to be enrolled under continuous signup fiscal year 2010. 138 24-1 1 The expiration schedule is now as follows: FY 2010 FY 20 | } FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 4.5 m a. 4.4 m.a. 6.5 m.a. 3.3 m.a. 2.0 m.a. 1.7 m a. 1.2 m.a. FY 2009 ended with 33.7 million acres under contract. With contracts expiring on 2.8 million acres September 30, 2009, FY 2010 enrollment began with 30.9 million acres under contract. Combined general and continuous signup is projected to remain at or near the 32 million-acre-cap throughout the baseline period. Conservation Reserve Program Program Level {Dollars in Thousands) Program Level - 2009 Actual 2010 Estimated 2011 Estimated Financial Assistance.................... s $1,855,274 $1,859,914 $1,826,430 Technical Assistance (Obligations)...... 78,386 101,749 146,552 Total, Program Level................... $1,933,660 $1,961,663 $1,972,982 Emergency Forestry Conservation Reserve Program (EFCRP). The Emergency Supplemental Appropriations to Address Hurricanes in the Gulf of Mexico and Pandemic Influenza, 2006, P.L. 109-148, mandated that during calendar year 2006, the Secretary shall carry out an emergency pilot program in States that the Secretary determines have suffered damage to merchantable timber in counties affected by hurricanes during the 2005 calendar year. The Act provided $404.1 million for this program. The Emergency Supplemental Appropriations Act for Defense, the Global War on Terror, and Hurricane Recovery, 2006, P.L. 109-234, signed June 15, 2006, increased funding by $100 million, to $504.1 million. The U.S. Troop Readiness, Veterans’ Care, Katrina Recovery, and Iraq Accountability Appropriations Act, 2007, P.L. I 10-28, signed on May 25, 2007, reauthorized EFCRP enrollment and signup resumed in August, 2007. Signup was terminated in December 2008, EFCRP enrollment as of October 31, 2009 was 288,532 acres. Voluntary Public Access and Habitat Incentive Program. The Voluntary Public Access and Habitat Incentive Program was established by Section 2606 of the 2008 Farm Bill to encourage farmers and ranchers to allow public access on their lands. It provides up to $50 million of CCC funding through FY 2012 to be granted to States that have public access programs. Outlays are estimated at $36.67 million per year for the period FY 2010-2012, Biomass Crop Assistance Program (BCAP). BCAP was established by Section 9001 of the 2008 Farm Bill. Funded by the CCC, BCAP provides rental and cost-share payments to encourage production of biomass crops. Payments are also provided to offset harvest, storage, and transportation costs. FY 2009 outlays were $2.1 million with $263.0 million and $479.0 million estimated for FY 2010 and FY 2011, respectively. Agricultural Management Assistance Program (AMA). This program provides grants to qualified public and private entities for educating agricultural producers about the full range of risk management activities, including futures, options, agricultural trade options, crop insurance, cash forward contracting, debt reduction, production diversion, farm resources risk reduction and other risk management strategies. 139 24-12 The 2008 Farm Bill provided $15 million in funding for FY 2008-2012. CCC transferred $7.5 million to the Natural Resources Conservation Service, $6.0 million to the Risk Management Agency, and $1.5 million to the Agricultural Marketing Service in FY 2009, and plans to transfer the same amounts in FY 2010. The FY 2011 budget proposes limiting the NRCS AMA program to $2.5 million in 2011. OTHER CCC PROGRAMS ree Assistance Program. Over $30 million in CCC funding was provided under Division B, Chapter 1, f the FY 2005 Military Construction Appropriations and Emergency Hurricane Supplemental ppropriations Act and the Emergency Agricultural Disaster Assistance Act of 2006, P.L. 109-234. These cts assisted producers who suffered tree and tree crop losses in hurricane-affected counties and provided or site preparation, replacement, rehabilitation and pruning. Having met these prior year needs, the rogram is winding down, with FY 2009 outlays at $68 thousand. - iik Income Loss Contract. The 1996 Farm Bill had established a Dairy Recourse Loan Program that as never implemented due to repeated legislative extensions of the Dairy Price Support Program. The 002 Farm Bill repealed all legislative authority for the Dairy Recourse Loan Program, but established a ew Milk Income Loss Contract Program, under which the Secretary may contract with eligible producers p to September 30, 2005, to make monthly payments when milk prices fall below specified levels. The ilk Income Loss Contract Program was extended through August 31, 2007 by the Deficit Reduction Act f2005, P.L. 109-171. The 2008 Farm Bill extends the MILC program through September 30, 2012. The ilk Income Loss Contract Program outlays in FY 2009 were $756.9 million. - ayment Limitations in general, the 2002 Farm Bill revised the Food Security Act of 1985 (7 U.S.C. 308) for payment limitations. The total amount of direct payments made to a person during any crop year or one or more covered commodities may not exceed $40,000. The total amount of counter-cyclical ayments made to a person during any crop year for one or more covered commodities may not exceed 65,000. The total amount of marketing loan gains and payments that a person may receive during any crop ear may not exceed $75,000. Notwithstanding any other provision or law, an individual or entity shall not e eligible to receive any benefit during a crop year if the average adjusted gross income of the individual r entity exceeds $2,500,000, unless not less than 75 percent of the average adjusted gross income of the dividual or entity is derived from farming, ranching, or forestry operations, as determined by the jecretary. The 2008 Farm Bill extends this through the 2008 crop year. The 2008 Farm Bill rescinds the three entity rule for payment limitation purposes for the 2009-2012 crops. nstead, payments are tracked as received directly or indirectly by an individual person or legal entity. ;xcept for those who elect to receive ACRE payments, the direct payment limitation remains at $40,000 nd the counter-cyclical payment limitation remains at $65,000. Beginning with the 2009 crop, the 2008 arm Bill rescinds the payment limitation for both marketing loan gains and loan deficiency payments. Sommodity program payments are subject to farm and nonfarm adjusted gross income (AGI) limits for 009-2012 crop years. The AGI limit for farm income is $750,000 and $500,000 for nonfarm income. xport Subsidy Program. Under the Dairy Export Incentive Program (DEIP), CCC funds are used to make onus payments to exporters of U.S. agricultural commodities to enable them to be price competitive and, hereby, make sales in targeted overseas markets where competitor countries are making subsidized sales. .S. dairy products were competitive in overseas markets during 2008 due to favorable world market onditions, and no bonuses were awarded under DEIP. Due to declining dairy prices, this situation is hanging in FY 2009 and is expected to continue in FY 2010. The program level may increase or decrease rom the projected level depending upon the relationship between U.S. and world market prices during the purse of the programming year. 140 24-13 Foreign Market Development Programs. CCC finds are used extensively to enhance U.S. competitiveness and expand foreign markets for U.S. agricultural commodities and products. The following programs highlight CCC activity in these areas: l - Market Access Program (MAP). Under this program, CCC funds are used to reimburse participating organizations for a portion of the costs of carrying out overseas marketing and export promotion activities. Program participants include nonprofit agricultural trade organizations, State-regional trade groups, cooperatives, and private companies that qualify as small business concerns. The 2011 Budget provides funding of $160 million. - - - Foreign Market Development (Cooperator) Program (FMD). Under the Foreign Market Development (Cooperator) Program, cost-share assistance is provided to nonprofit commodity and agricultural trade associations to support overseas market development activities that are designed to remove long-term impediments to increased U.S. trade. These activities include technical assistance, trade servicing, and market research. Unlike MAP, Cooperator Program activities are carried out on a generic commodity basis and do not include brand-name or consumer promotions. The 2008 Farm Bill re-authorized the program and the 2011 budget provides $34.5 million for the Cooperator Program. In addition, the 2011 budget proposed an additional $34.5 million in discretionary appropriations as part of the National Export Initiative. - Technical Assistance for Specialty Crops (TASC) Program. TASC is designed to address unique barriers that prohibit or threaten the export of U.S. specialty crops. Under the program, grants are provided to assist U. S. organizations in activities designed to overcome phytosanitary and related technical barriers to trade. Re-authorized by the 2008 Farm Bill, the budget provides $9 million for TASC in FY 2011. In addition, the 2011 budget proposes an additional $9 million in discretionary appropriations as part of the National Export Initiative. Emerging Markets Program. The Emerging Markets Program authorizes CCC funding to be made available to carry out technical assistance activities that promote the export of U.S. agricultural products and address technical barriers to trade in emerging markets. Many types of technical assistance activities are eligible for funding, including feasibility studies, market research, industry sector assessments, specialized training, and business workshops. The 2008 Farm Bill re-authorized this program and the budget provides $10 million for FY 2011. Quality Samples Program (QSP). Under the Quality Samples Program, CCC provides funding to assist private entities to furnish samples of U.S. agricultural products to foreign importers in order to overcome trade and marketing obstacles. The program provides foreign importers with a better understanding and appreciation of the characteristics of U.S. agricultural products. The program is carried out under the authority of the CCC Charter Act and is not subject to reauthorization under the Farm Bill. For FY 2011, the budget includes $2.2 million of CCC funding for this program. Dairy Export Incentive Program (DEIP). The program provides cash bonus payments to exporters to facilitate commercial sales of U.S. dairy products in overseas markets. Estimates of the quantity of dairy products to be exported under DElP and associated expenditures were formulated within the maximum allowable expenditures and quantity levels specified in conjunction with provisions of the Uruguay Round Agreement. These levels result in baseline projections that assume DEIP will not exceed $116.6 million annually through 2012. Actual DEIP subsidies are further limited on a product- by-product basis under the Uruguay Round - Transfers of Funds. The 2002 and 2008 Farm Bills and the FY 2006 through FY 2010 Appropriations Acts authorized CCC to transfer funds to various agencies to fulfill authorized programs through FY 2010 The following table shows recipient agencies and amounts of transfers anticipated for fiscal years 2010 and 2011: - 141 24-14 CCC Farm Bill Transfers (Dollars in Thousands) FY2010 Agencies Receiving Transfers: FY 2011 Agricultural Marketing Service $61,500 $66,500 | Animal and Plant Health Inspection Service 50,000 55,000 Office of Chief Economist 1,000 1,000 National Institute of Food and Agriculture 137,000 | 139,000 Departmental Administration 2,000 2,000 Food and Nutrition Service . . . . . 20,600 20,600 Natural Resources Conservation Service 2,965,484 3,784,342 Risk Management Agency 6,000 6,000 Rural Development 364,000 | 159,000 Total 3,607,584 4,233,442 PROPOSED LEGISLATIVE CHANGES As part of the President's commitment to fiscal responsibility, the Budget includes several significant offsets. The proposals include programmatic changes that: - - 1. Reduce Direct Payment Cap. To transition the dependence of large farms and wealthy landowners on direct payments made on the basis of historical base acres to revenue from other sources including emerging markets for environmental services, the President's Budget proposes a 25 percent reduction in the current cap on direct payments to individuals. The 2008 Farm Bill set a limitation of $40,000 in direct payments per producer participant in the Direct and Countercyclical program and $32,000 for those who participate in he Average Crop Revenue Election (ACRE) program. The proposed adjustment will reduce the limitations o $30,000 (or $24,000 for those in the ACRE option.) These payments are made regardless of market brices, losses, or whether the land is still producing crops. Direct payments are only a modest portion of the ‘oughly $1.7 billion in direct Government support already provided to farm producers through various JSDA programs inchuding farm commodity and income support payments, crop insurance benefits, disaster Jayments, and Conservation Reserve Program rental payments Estimated savings over 10-years are $1.5 - hillion. - - - 2 Tighten Payment Eligibility The President wants to maintain a strong safety net for farm families and Yeginning farmers. The need for more fiscal responsibility necessitates reexamination of government ń. to wealthy individuals who are better able to take advantage of new market opportunities. herefore, the Budget also proposes a three-year phased reduction in farm program average Adjusted Bross Income (AGI) eligibility limits from the current $500,000 of non-farm AGI to $250,000, and the farm AGI limit for eligibility for direct payments would be reduced from the current $750,000 set by the 2008. Farm Bill to $500,000 over a three-year period as well. These adjustments in current program limits would ffect only a very small portion of the farm program participants without disturbing the foundation of the urrent safety net for productive family farmers. Estimated savings over 10-years are $764 million. i. Eliminate Cotton and Peanut Storage Credits. The Presidents Budget proposes to eliminate the equirement for the Government to pay the storage costs of cotton and peanuts that are put under loan with JSDA Cotton is the only commodity for which this assistance is regularly provided. Storage credits for otton have been found to have a negative impact on the amount of cotton on the market. Because cotton torage is covered by the Government, producers may store their cotton for longer than necessary. Peanut torage credits are only provided if the crop is forfeited to the Government, therefore payments are rarely made and there is little need for storage credits. Estimated savings are $2 million. - 142 24-15 4. Reform the Market Access Program (MAP). The Budget proposes an annual funding reduction of 20 percent, which will reduce Federal spending. Estimated savings over 10-years are $366 million. CCC NET EXPENDITURES CCC net expenditures for FY 2010 are estimated at $11.93 billion, up $0.5 million from FY 2009 outlays of $11.4 billion. FY 2011 baseline expenditures are estimated at $11.4 billion. - - The following table shows CCC net expenditures under current law by commodity and program for fiscal years 2009 through 2011. - COMMODITY CREDIT CORPORATION FY 2009 ACTUAL, FY 2010 AND FY 2011 ESTIMATED EXPENDITURES i (Dollars in Thousands) 2009 Actual 2010 Estimate 2011Estimate Corn . • * * * * * * * $2,175,392 $2.156,617 $2,349.619 Grain Sorghum . 197. 171 200,137 j95.933 Barley.......... 83.518 93,034 94,36; Oats. . • * 'w p * * * * * * * * * * * * * 3.223 3,872 4.795 Corn and Sorghum Products - #.303 –3, 108 () Total Feed Grains and Products... 2.458.001 2,450,552 2.644,708 Wheat and Products. 1.224.400 1.298.580 1,424.690 Rice ... ... .............. .............................. 4i #,434 558,316 429,370 Upland Cotton ........... 2,176.045 2,393,327 1,550,056 ELS Cotton, . . . 36,767 -6,248 || 2029 Tobacco. ........ - | 72.279 0. {) Honey . ... .......... ... ............... ..... . . -810 50 398 Dairy . a * * * * * * * * * * * * * * * * * * * * * * * 994,031 343,002 361.778 Soybeans and Products. . . . 6 : 1, 197 585,454 623,831 Minor Oilseeds.. 22.749 21,697 25.352 Sugar.......... 2 {} 0. Peanuts...... . . . . . * * 98.247 89,800 131.860 Wool and Mohair.... ................ . . . 8.580 6,923 7, 171 Vegetable Oil Products ....... ... . . . . .... 27,843 48,610 30,389 Other Commodities 56,443 –7,680 4.985 Total Commodities . . * * * * * * * * * * 7.952,650 7,782.083 7,236,6}.7 Tobacco Trust Fund . .......... . . ..... .... ..... 1,130,095 960,000 960 000 Export Guarantee Program. Liquidating –4,307 -4,000 -8,000 Export Guar Program (subsidy) Account. ... .. 80. H04 83,000 23,000 Market Access Program. .... ......., , , 218,609 193,740 200.000 Foreign Market Development Cooperator 36.467 34,471 34,500 Quality Samples Program. . . . . ....... ... . 890 2,487 2,273 Export Donations - Ocean Transportation 40.378 41,071 41.900 Crop Disaster Assistance ... ... ...... ... .. } |4 {} 0. Noninsured Assistance Program 38.443 93,399 95, 196 Emergency Livestock Assistance. .... • 32 {} 0 American Indian Livestock indemnity.......... - 24 () 0 Tree Assistance. ..................... ... . ...... . . . 68 {} 0 Conservation Reserve Program (CRP)... .... ... .. 1,946,468 1973,411 1,958.131 Emergency Forestry CRP 9.846 | 8.896 || 14.420 Wetlands Reserve Program... ... -i . () 0 143. 24-16 2009 Actual 2010 Estimate 20 l l Estimate Voluntary Public Access & Habitat Incentives * Program º - - - - {} | 6,667 16,667 Pilot Program for Local and Regional Food Aid 0 14,750 25,000 Biomass Crop Assistance * 2,147 263,000 | 479,000 Technical Assistance for Specialty Crops 1.55 4,577 7.580 interest ...... * * * * * * * -i 6.839 -2,477 42.375 CCC Operating Expenses 39.7 9 13.711 6. # 80 Total Programs and Expenses 3.493.808 3,706,703 3.898.222 Change in Working Capital - - -50.558 250,000 250,000 Farm Storage Facility Loan Program Account 6,582 10,000 4,000 Ali Other 3. * º 40,042 | 77.964 57,004 Total Net Expenditures. CCC Baseline. . | 1.442.524 11.926.750 | 1.445,843 Commodity Credit Corporation Statement of Available Funds 2009 Actual and Estimated 2010 and 20 ! : (Dollars in Thousands) Item 2009 Actual 2010 Estimated 20 i i Estimated Reimbursement for Net Realized Losses $12,085,034 $15,079,163 $13,925,575 Purchase of Cheese and Cheese Products () 60,000 {} CCC Export Credit Guarantee Program Account (permanent, indefinite) 29,834 | 1,130 18,480 CCC Export Loans Program Account (current, discretionary) 5,333 6,820 6,465 CCC Storage Facility Program Account (permanent, indefinite) i2,500 0. {) Total Commodity Credit Corporation $12,132,701 $15,157,113 $13,950,520 144 24- #7 COMMODITY CREDIT CORPORATION Classification by Object 2009 Actual and Estimated 2010 and 2011 (Dollars in Thousands) 20 ! I 2009 2010 Direct Obligations: - - - - 22.0 Transportation of things................... $67,715 $205,771 $200,460 25.2 Other services.......... ................... i 17,706 406,683 313,531 25.2 Other services: storage & handling...... 8,039 5,495 2,142 26.0 Supplies and materials (cost of commodities sold or donated - CCC)... 4,064,147 2,910,275 1,199,513 31.0 Equipment,.................................. 0. 0. 0 41.0 Grants, subsidies, and contributions..... 10,226,357 10,500,306 10,695,760 43.0 Interest and dividends ....... ............. 22,997 28,867 108,524 99.0 Subtotal direct obligations............. 14,506,961 14,057,397 12,519,930 Reimbursable Obligations: 22.0 Transportation of things: PL 480 Ocean Transportation... . . . . . . 531,383 778,562 796,000 26.0 Supplies and materials (cost of commodities sold or donated - PL 480). 902,683 994,037 1,016,301 33.0 Investments and loans..................... 8,290,909 8,593,372 8,345,955 99.0 Subtotal reimbursable obligations... 9,724,976 10,365,971 10, 158,256 99.9 Total Obligations. ... ...... ... ............... 24,231,936 24,423,368 || 22,678,186 145 24-18 COMMODITY CREDIT CORPORATION he estimates include appropriation language for this item as follows: COMMODITY CREDIT CORPORATION FUND Reimbursement for Net Realized Losses For the current fiscat year, such sums as may be necessary to reimburse the Commodity Credit Corporation for net realized losses sustained, but not previously reimbursed, pursuant to section 2 of the Act of August 17, 1961 (15 U.S.C. 713a-il): Provided, That of the funds available to the Commodity Credit Corporation under section 11 of the Commodity Credit Corporation Charter Act (15 U.S.C. 714i) for the conduct of its business with the Foreign Agricultural Service, up to $5,000,000 may be transferred to and used by the Foreign Agricultural Service for information resource management activities of the Foreign Agricultural Service that are not related to Commodity Credit Corporation business Hazardous Waste Management (Limitation on Expenses) For the current fiscal year, the Commodity Credit Corporation shall not expend more than $5,000,000 for site investigation and cleanup expenses, and operations and maintenance expenses to comply with the requirement of section 107(g) of the Comprehensive Environmental Response, Compensation, and Liability Act (42 U.S.C. 9607(g)), and section 6001 of the Resource Conservation and Recovery Act (42 U.S.C. 6961). - - 146 24-19 Reimbursement for Net Realized Losses (in $000) Appropriations Act, 2010. ..................... . . ... = N ºr º w w w w w w tº * * * * * * * * * * * * * * w m ºn a º º a s - w is a Budget Estimate, 2011.............. * s sº e < * * * * ~ * v - w is e s e º s e º e s - a w w - - - - a s ºr w w is w r * * * * * * * * * * * * * * * Decrease in Appropriations ... .... ... ................. ... ....................................... s • * * * * * * * * * * * s us is s s a sº v - - - - - $15,079,163 13,925,575 * * > t > 0 - - - - - - - - -1,153,588 SUMMARY OF INCREASES AND DECREASES (On basis of appropriation) Item of change 2010 Estimated Change 2011 Estimated Reimbursement of losses - 2009 actual losses $15,079,163 -$15,079,163 $0 2010 estimated losses () 13,925,575 13,925,575 Total Available - 15,079,163 - 1,153,588 13,925,575 PROJECT STATEMENT (On basis of appropriation) Item 2009 Actual 2010 Estimated Decrease 2011 Estimated Reimbursement of losses: Appropriation $12,085,034 $15,079,163 -$1,153,588 $13,925,575 FY 2009 losses were reimbursed through the FY 2010 Appropriations Act. 147 24-20 RECONCHLIATION TO BUDGET AUTHORITY he preceding analysis of realized losses explains the actual 2009 losses of CCC Regardless of whether ppropriations made to CCC are to restore losses or are for other purposes, CCC must record losses in its ooks for numerous required purposes, including the computation of capital impairment. he following table reconciles budget authority with appropriations (Dollars in Thousands) 2010 201 i Appropriation (for realized losses) aſ * $15,079,163 $13,925,575 Appropriation for Purchase of Cheese - and Cheese Products 60,000 () Portion applied to CCC debt reduction -i 1,443,698 –9,692,133 Transferred to Other Accounts -3,635,465 —4,233,442 Adjusted Appropriation - 60,000 0 Adjustments: Authority to borrow 10,779,000 10,497,000 CCC Export Loans Program Account 147,093 17,950 Budget Authority (net) - 10,986,093 10,514,950 aſ Reimbursed through current indefinite appropriation in FY 2010 Appropriations Act and the same is anticipated to be authorized in FY 2011 Appropriations Act. he following tables reflect actual and estimated losses by commodity and program for fiscal years 2009 hrough 20 t 1. - 148 24-21 FY 2009 - ACTUAL (millions of dollars) Ail Other Feed Grains Wheat and Upland Dairy Commodities and ITEM TOTAL } and Product | Products Rice Cotton_i Soybeans i Products Programs aſ Program Costs - Gain (-) or loss on sales 8876 0 0 () () 0 () 884.3 {} {} 0 0 33 Domestic Donations 882 0 () 28 | 0 0 0 0 0 40 8 43 Export Donations #03 9 9 3 45 5 0 0 0 0 2 3 0 0 46 8 Storage and Handling 8.0 0 0 0 0 0.0 () } 0 0 56 2 3 Transportation | 6 0 0 0 0 {} {} {} 0 0 0 0.6 i Production Flexibility Payments {} } 0 0 {} {} () () {} i Q 0 0 0 () {} Loan Deficiency Payments 1486 1.7 6 5 0,0 13 7 0 0 0 0 8 Counter-Cyclical Payments 1,213 3 {} 0 {}.0 0 0 762 0 0 0.0 1,137 | Direct Payments 4, 1766 323 2 127, 49 () 475 737 0 () 3,556 Milk income Loss Payments 769 9 0 0 {} {} () () 0 0 0 0 769 9 0 0 Conservation Reserve Program 1,8729 0 0 0 0 0 0 0 0 0 0 0.0 1,872 9 Environmental Quality incentives 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Program Other Conservation Program b/ 7.9 {}.0 0 0 0.0 0.0 0 0 0 0 7 9 Crop Disaster Payments O 3 {} 0 0 0 0 0 0 0 0 0 0.0 03 Foreign Market Development Coop 36 6 0 0 () {} () () 0 0 0 0 0 () 36 6 Quality Samples Program 09 0 0 0 0 0 0 0 0 0 0 0 0 09 Noninsured Assistance Program 40 7 0 0 {} {} 0 0 0 0 0 0 0 0 40 7 Market Access Program 2186 () 0 {} 0 {} 0 {) 0 0 0 0 0 2}8 6 Marketing Loan Write-offs 7868 0 0 0 0 0 0 777 9 {} {} 0 0 89 Transfers to Other USDA Agencies 2,831 | {} 0 0 () 0 0 {) 0 0 0 O 0 2,83; 1 Other c/ 1,888 6 06 {}, i 0 3 -673.9 03 6 | 2,555 l Total Program Costs 15,0822 334 8 i82.0 50.3 i,243 9 76 3 823 () 12,371 9 Nonprogram Costs - interest (net) Support and Related Costs -45 8| Export Credit Sales 0 0 Łoss in Interest Income 3 i Operating Expenses 39 7 Total Nonprogram Costs -3.0}. Total Net Realized Losses 15,079 2 aſ Other commodities and programs include tobacco, soybean products, blended food products, vegetable oil products, sugar, wool, mohair, pulse crops, peanuts, honey and minor oilseeds bí Other conservation programs include the Emergency Forestry Conservation Reserve Program, Wetlands Reserve Program, Farmland Protection Program, Agricultural Management Assistance Program, and Soil and Water Conservation Assistance c/Other costs include miscellaneous cash payment losses, other loans written off, ocean transportation for export donations, cotton user marketing payments, and all other miscellaneous expense. r" 149 penses Other commodities and programs include tobacco, soybean products, blended food products, vegetable oil products, wool, ohair, pulse crops, peanuts, honey and minor oilseeds Other conservation programs include the Emergency Forestry Conservation Reserve Program, and Voluntary Public Habitat and incentives Program Other costs include miscellaneous cash payment losses, ocean transportation for export donations, and alj other miscellaneous 24-22 FY 2010 - ESTIMATED (millions of dollars) All Other - Feed Grains | Wheat and Upland Dairy Commodities and |TEM TOTAL | and Product | Products Rice Cotton | Soybeans | Products Programs aſ rogram Costs - air (-) or loss on sales 25 3 0 0 0 0 {} {} 25 0. 0 () (), i 0 2 Omestic Donations 223 4 0 0 0 0 0 0 {} {} 0 0 223 4 0 0 Xport Donations 82 8 2 8 | 9 | 6 {} {} ! 3 | 4 52 | orage and Handling 5 S 0 0 0 0 {) () 0 0 {} {} 6 || -0 6 ransportation 5 3 0 0 () {} {} 0 0 0 0 0 53 0 0 ban Deficiency Payments 1785 | S i58 ()) {} {} | 2 | 0 0 0 0 69 punter-Cyclical Payments 1,219 2 0 0 0 0 0 0 1,194 | 0 0 () {} 25 | trect Payments 5, 144 3 2,369.3; 1,079 7| 42} 8| 648 3 5659 0 0 89 3 lik income Loss Payments 2 : H 8 0 0 0 0 {} 0 0.0 00] 21 i 8 0 0 onservation Reserve Program 2,018 0 0 () 0 0 0 0 {} 0 0 0 0 0 2,018 0 ther Conservation Program bl 35 6 0 0 O 0 () () () {} 0.0 0 0 35 6 breign Market Development Coop 34 5 0 0 0 0 () (; 0 0 0 0 0 0 34 5 uality Samples Program 2 5 0 0 {} () () () 0 0 0 0 0 0 2 5 oninsured Assistance Program 9 : { 0 0 0 0 0 0 {} {} 0 0 0 0 9 : ] alry Export incentive Payments 25 4 () () {} 0 () () {} {} {} () 25 4 {} {} arket Access Program 1937 0 0 0 0 0 0 {} {} {} 0 () () 1937 arketing Loan Write-offs S 9 0 0 1 8 0 0 2 6 0 0 () () | 5 ſansfers to Other USDA Agencies 3,635 5 0 0 0 0 0 0 0 0 {} {} 0 0 3,635 5 ther ch 775 4 i5 4 () } () {} 304 9 0.0 -59 9 $149 Total Program Costs t3,913 7 2,389 0} 1,258 7. 427.9| 2, $57 0 $67.2 413 6 6,700 3 onprogram Costs terest (net). - Support and Related Costs - || 8 Export Credit Sales 00 Loss th Interest income 0 0 perating Expenses 13 7 Total Nonprogram Costs | | 9 btal Net Realized Losses 13,925 6 150 24-23 FY 2011 - ESTIMATED (millions of dollars) All Other Feed Grains Wheat and Upland Dairy Commodities and ITEM TOTAL and Product Products | Rice Cotton | Soybeans | Products Programs aſ Program Costs - Gain (-) or loss on sales 0 0 0 0 0 0 0 0 0 0 0 0 0 0 {} Domestic Donations 42 9 {) 0 0 0 0 0 0 0 0 0 ° 429 {} Export Donations 889 | 9 41 3 { 1 0 0 0 0 0 0 i Storage and Handling 2, 1 0 0 0 0 () {} 0 0 0 0 2 () à Transportation 22 0 0 {} 0} {} {} 0 () 0 0 22 Ö Loan Deficiency Payments 23 3 {}.0 16, i {} {} 0 0 0 0 0 0 7 Counter-Cyclical Payments 738 4 0 0 {} 0 {} {} 675 6 0.0 0 () 62 Direct Payments 4,962 9 2,279 4} 1,0463 418 3 589.9 543 8 0 () 85 ACRE Payments 438 3 83 7 307.1 0 0 0 0 38 5 0 0 9 Milk Income Loss Payments {{)0 0 0 0 0 0 {} {} 0 0 {} 0 100 0 {} Conservation Reserve Program 1,958 I 0 0 0 0 0 0 () 0 0 0 () () 1,958 Other Conservation Program b/ 31 | 0 () 0 0 {} {} 0 0 0 0 0 0 3 i Foreign Market Development Coop 34 5 {),0 0 0 {} {} 0 0 0 0 0 0 34 Quality Samples Program 2 3 {} () 0 0 {}_{} 0 0 {} {} 0 0 2 Noninsured Assistance Program 95.2 {} 0 0 0 0 0 0 0 () {} 0 0 95 Market Access Program 200 0 0 0 0 0 0 {} 0.0 0 0 0 0 206 Marketing Loan Write-offs 4 3 0 0 4 3 () {} 0 0 0 0 0 0 Q Transfers to Other USDA Agencies 4,233 4 0 0 0 0 0.83. 0 0 0 0 0 0 4,233 Other c/ 1,4670 280 6 -0 | -0 i 278 0 34 0 2554 649 Total Program Costs 14,424 9 2,645 6] 1,415 0# 419 3| 1,543 5 6}63 402.5 7,382 Nonprogram Costs Interest (net) Support and Related Costs 5 i 4 Export Credit Sales 0 0 Loss in laterest lincome 0 () Operating Expenses 62 Total Nonprogram Costs 57 6 14,482.5 Total Net Realized Losses aſ Other commodities and programs include soybean products, blended food products, vegetable oil products, wool, mohair, pulse crops, peanuts and minor oilseeds b/Other conservation programs include Emergency Forestry Conservation Reserve Program and Voluntary Public Habitat and incentives Program c/Other costs include miscellaneous cash payment losses, ocean transportation for export donations, and all other miscellaneous expenses 151 24-24 coMMODITY CREDIT CORPORATION FARM AND SUGAR STORAGE FACILITY LOAN PROGRAMS Program Level Subsidy Appropriations Act, 2010. ...... - - - - - - - - - - - - - - - ........... $152,500,000 0 udget Estimate, 2011........ .............................. 152,500,000 () Shange in Appropriation... ... ... . . . . . . . . . . . . . . . . . . . . . {} 0 Summary of Increases and Decreases - (On basis of appropriation) 2010 . Program 2011 Item of Change Estimated Changes Estimated Program Level: FSFL......................... ......... $150,000,000 0 $150,000,000 SSFL .... ........ ..... ... … 2,500,000 () 2,500,000 Total Program Level . ... ... 152,500,000 0 152,500,000 Subsidy Costs, FSFL . . . . . . a 9 ºr r * * * * * * * {} 0 {} SSFL...... & v ºr 4: º ºs e e º e M tº t w w w & # * * * * * * * * 0. () Total Available... ........... 0 152 24-25 COMMODITY CREDIT CORPORATION . FARM AND SUGAR STORAGE FACILITY LOAN PROGRAMS Project Statement by Program (On basis of appropriation) Increase or 2009 Actual 2010 Estimated Decrease - 2011 Estimated Program Level: - . FSFL . $200,000,000 $150,000,000 {} $150,000,000 SSFL . {} 2,500,000 0 2,500,000 Total Program Level 200,000,000 152,500,000 {} 152,500,000 Subsidy Costs FSFL 12,500,000 {} {} O SSFL 0 0 {} 0. Total Available or Estimate 12,500,000 {} 0. {} 153 24-26 COMMODITY CREDIT CORPORATION FARM AND SUGAR STORAGE FACILITY LOAN PROGRAMS Geographic Breakdown of Obligations 2009 Actual and Estimated 2010 and 2011 Alabama Arizona Arkansas Colorado Dehaware Florida Georgia Hawaii Idaho Illinois Indiana Iowa Kansas Kentucky Louisiana Maine Maryland Massachusetts Michigan Minnesota Mississippi Missouri Montana Nebraska New Jersey New York North Carolina North Dakota Ohio Oklahoma Oregon Pennsylvania South Carolina South Dakota Tennessee Texas Utah Vermont Virginia Washington West Virginia Wisconsin Wyoming Undistributed - Total, Available or Estimate 2010 Estimated 2009 Actual 2011 Estimated $366,970 $279,814 $279,814 55,587 42,385 42,385 3,636,536 2,772,850 2,772,850 1,063,372 810,819 810,819 0 () O 163,035 124,313 124,313 476,741 363,514 363,514 0 () () 270,938 206,590 206,590 24,356,238 18,571,576 18,571,576 6,406,895 4,885,243 4,885,243 41. 21,612 31,355,589 31,355,589 3,405,899 2,596,990 2,596,990 1,974,743 1,505,737 1,505,737 1,085,333 827,564 827,564 {} {} {} 514,324 392,171 392,171 0 0 O 2,722.114 2,075,606 2,075,606 29,237,393 22,293,446 22,293,446 2,887,055 2,201,373 2,201,373 9,226,660 7,035,307 7,035,307 746,258 569,020 569,020 18,179,475 13,861,809 13,861,809 33,168 25,290 25,290 3,525,246 2,687,992 2,687,992 1,522,527 1,160,924 1,160,924 7,236,686 5,517,957 5,517,957 3,393,540 2,587,567 2,587,567 444,438 338,883 338,883 1 1, 175 84,771. 84,771 1,521,712 1,160,302 1,160,302 1,915.894 1,460,865 1,460,865 27,216,940 20,752,855 20,752,855 678,511 517,363 517,363 269,119 205,202 205,202 {} () () 52.45} 39,994 39,994 678.1 ! {} 517,057 517,057 0 0 () 44.882 34,222 34,222 3.394,726 2,588,471 2,588,471 63,696 48,568 48,568 0. 0 0. 200,000,000 152,500,000 152,500,000 154 24-27 COMMODITY CREDIT CORPORATION Farm and Sugar Storage Facility Loan Programs Classification by Objects 2009 Actual and Estimated 2010 and 2011 Object Class 2009 2010 - 2011 41 0 Grants, subsidies, and contributions $12,500,000 0 0. 99.0 Total obligations 12,500,000 0 O 155 24g-l COMMODITY CREDIT CORPORATION Durrent Activities: STATUs of PROGRAM Commodity Loans Made and Outstanding (Dollars in Billions) | 2000 2002 2006 2001 2003 || 2004 2005 2007 2008 || 2009 Loans Made $9.7 || $8.3 $10.] $10.7 $9.1 $12.6 $12.0 $11.3 $9.5 $8.3 Loans Outstanding $3.1 $1.9 $1.6 $1.6 $1.8 || $1.1 || $1.5 $0.7 $0.6 $0.4 FY 2009 Commodity Loans (Dollars in Thousands) Loans - Loans - Outstanding Loan Outstanding Commodity SOY Loans Made Reductions EOY - Cotton.................. . 4- $368,962 $2,718, 184 $3,031,103 $56,043 Feed Grains.......... . s 99,055 2,082,307 2,025,296 156,066 Minor Oilseeds ............. 397 20,322 17,768 2,951 Peanuts......................... # 5.842 718,163 706,852 27,153 Rice 36,629 444,733 451,444 29,918 Soybeans...................... i 1,028 941,978 939,082 13,924 Sugar............................. {} 1,118,369 1,118,369 - 0 Wheat........................ ... 93,590 236,243 206,053 123,780 Other............ ................ 4,046 10,610 10,470 4,188 Total..................... $629,549 $8,290,909 $8,506,435 $414,023 FY 2009 Direct and Counter-Cyclical Payments (Dollars in Thousands) - Commodity Counter-Cyclical Direct - Barley................. ... ............... ..... -$2 $80,416 Corn. ........................ ....…....... 0 2,110,027 Minor Oilseeds 0 20,211 Oats .......... . . () 3,020 Peanuts.......... . 3,098 68,994 Rice............... * * * ~ * 35 416,740 Sorghum........ ... ... ..................... 3 196,956 Soybeans.................................... -8 590,276 Upland Cotton............................. 727,795 596,927 Wheat.................. ... .................--- -3 1,138,370 Unidentified Commodity............ 169 388 Total $731,087 $5,222,325 156 Other Payments Made Directly to Producers. The following table includes production flexibility payments, deficiency payments, loan deficiency payments, marketing loss assistance payments, and oilseed payments, but excludes direct and counter-cyclical payments. Other Payments to Producers 24g-2 (Dollars in Millions) Commodity 2004 2005 2006 2007 2008 2009 Cotton $19.9 $381.9 $622.3 $1 5.9 $30.3 $215.5 Dairy 22]. 1 . 9. I 35 j.6 156.6 2.2 756.9 Feed Grains 159.2 3,050.2 4,202.5 5.7 0 1.7 Minor Oilseeds 4 2 74 25.6 0 0 () Rice ! 99.5 49.0 49.3 -0.2 {} } {} Soybeans 3.4 286.3 22.0 45.8 0.1 0 Wheat 30.5 43.3 H4.3 0. -0. 1 4.0 Wool and Mohajr 12 0 7.6 7.9 7.2 5.8 7.3 Other 18.9 33.4 69.7 26.1 0.3 0.7 Total Payments $668.7 $3,868.2 $5,365.2 $357.1 $38.7 $986.1 Minus (-) indicates credit adjustment to the program. Purchases. Some commodities are purchased directly from processors. Milk prices are supported through purchases of processed dairy products from processors. Purchases of dairy products, purchases of wheat and wheat products, corn, oats, peanuts. and vegetable oils for donations and purchases of grains, soybeans and oilseeds on which loans are also made totaled $4,051.9 million, which is comprised of cash purchases of $1.254.6 million and certificate purchases of $2,797.2 million. Noninsured Crop Disaster Assistance Program (NAP). NAP payments in FY 2009 totaled $62 million, wit offsetting fees collected of $23.6 million. Of the payments, $2.5 million was for the 2007 crop, $50.4 million was for the 2008 crop, $9.6 million was for the 2009 crop and -$638 thousand was for the 2010 crop. Emergency Assistance CCC funding was provided for the following emergency programs in FY 2009. FY 2009 Emergency Assistance (Dollars in Thousands) Program 2009 Outlays Crop Disaster Assistance $114 Livestock Assistance Program 32 Tree Assistance Program 68 Total 214 157 24g-3 Farm Bili-Authorized CCC Transfers, FY 2009 {Dollars in Thousands) FY 2009 Agencies Receiving Transfers Amount Farm Service Agency - - $50,000 Foreign Agricultural Service 84,000 Agricultural Marketing Service - • 55,500 Animal and Plant Health Inspection Service 46,427 Office of Administration and Chief Economist 3,000 Cooperative State Research, Education, and Extension Service” 121,000 Natural Resources Conservation Service 2,202,540 Risk Management Agency 6,000 Food and Nutrition Service 23,600 Rural Development - 239,000 Total $2,831,067 * Agency’s name changed to National lnstitute of Food and Agriculture effective FY 2010. ompt Payment Act Interest Payments. Total interest paid on late payments during FY 2009 was ,229,012.93, compared to $1,078,371.78 in FY 2008. Payments were late because of program !cumentation delays, high number of payments being processed during payment cycle, misplacement or ishandling of documentation at the local office, and computer system processing delays as reported by te and county offices. rm Storage Facility Loan Program (FSFL). For FY 2009, loan obligations totaled $200.0 million. ar Storage Facility Loans. No loans were made in FY 2009. COMMODITY EXPORT ACTIVITIES e Corporation is authorized to promote the export of U.S. agricultural commodities and products ough sales, payments, direct credit, credit guarantees, and the conduct of other activities related to the portation of commodities. During FY 2009, CCC commercial export credit activities consisted of credit arantees under the GSM-102 Export Credit Guarantee Program. rect Credit From the beginning of the short-term export credit sales program in 1956 through ptember 30, 2005, sales of agricultural commodities amounted to approximately $9,649.2 million, with additional $722.9 million in capitalized interest resulting from debt rescheduling However, there has en no new program activity since fiscal year 1987. There was no amount outstanding under this program of September 30, 2009. Principal repayments from inception through September 30, 2009, totaled ,649.2 million. - - - CC Export Credit Guarantees During FY 2009, the following loan commitments were made under the re Export Sales Guarantee Programs. FY 2009 Loan Commitments Activity (Dollar in Thousands) GSM-102. Short-term Guarantees . ." $5,357 | Facilities Guarantee Program 0 Total - $5,357 158 24g-4 On July 1, 2005, the guarantee fees (premia) charged under the export credit guarantee programs were changed from a flat fee basis to a country risk-based approach. The revised premia respond to a World Trade Organization dispute panel decision and are intended to remove any long-term subsidy component the program, prospectively. U.S. Agricultural Technical Expertise Provided to Emerging Markets. The Food, Agriculture, Conservati and Trade Act of 1990, as amended, authorizes for each fiscal year through 2012, a program for promotin agricultural exports to emerging markets through the sharing of U.S. agricultural technical expertise. Actl expenditures during FY 2009 totaled $3.1 million, which included prior year obligations. Dairy Export lincentive Program (DEIP). The DEIP operates on a bid bonus system similar to the former Export Enhancement Program, with cash bonus payments. Cash payments of $1.0 million were made in FY 2009 and bonuses awarded in FY 2009 amounted to $18,893,822. Bill Emerson Humanitarian Trust (BEHT). The BEHT is a commodity and/or monetary reserve designed to ensure that the United States can meet its international food assistance commitments under P.L. 480 Tit II. Commodities or their cash equivalent that can be held in the reserve include wheat, corn, grain sorghui and rice. Assets of the BEHT can be released any time the Administrator of the U.S. Agency for lnternational Development determines that P.L. 480 Title II funding for emergency needs is inadequate to meet those needs in any fiscal year When a release BEHT release is authorized, the Trust's assets (wheth commodities or funds) cover all commodity costs associated with the release. All non-commodity costs, including freight charges; internal transportation, storage, and handling overseas; and certain administrati costs are paid by CCC. During fiscal year 2009, 21,000 metric tons of corn were donated overseas using BEHT authority. The total value of that assistance, including non-commodity costs, is estimated at $7.1 million - STORAGE ACTIVITHES The objectives of the Corporation in carrying out its storage program are to help producers finance needed storage facilities on their own farms and to make efficient use of commercial facilities in the storage of CCC-owned commodities. Commercial Storage. The Corporation has contracts with about 2,400 commercial warehouse operators in over 5,800 locations within 39 States for the storage of Government-owned and loan grain and rice. The grain and rice facilities have a total capacity of about 8.4 billion bushels. ln accordance with the Grain Standards and Warehouse improvement Act of 2000, user fees are charged for warehouse examination services of all warehouses licensed under the United States Warehouse Act (USWA). Grain, rice, and cotton warehouses not licensed under the USWA pay contract fees to CCC However, the collection of an annual contract fee is currently suspended. - SUPPLY AND FOREIGN PURCHASE ACTIVITIES The Corporation is authorized to procure agricultural commodities in the U.S. and abroad for U.S. and foreign governmental agencies and entities, pursuant to sections 5(b) and (c) of its Charter Act, and section 4 of the Act of July 16, 1943 (15 U.S.C. 713a-9). ACQUISITION AND DISPOSAL ACTIVITIES The Corporation acquires stocks of various farm products as a result of its support activities. Such acquisitions result from purchases from producers and processors and collateral acquisitions arising from loan operations The inventory was increased in FY 2009 from FY 2008. CCC's acquisition-cost value o September 30, 2009. was $205.2 million, as compared to $10.8 million in FY 2008. 159 Summary of Dispositions. The Corporation moves substantial quantities of farm commodities into useful 24g-5 channels, both at home and abroad. The value (at acquisition cost) of commodities removed from CCC inventories in FY 2009 was $3,916.7 million, and sales proceeds were $2,837.1 million, including certificate sales proceeds of $1,909.6 million. Commodity Inventories Owned by CCC End of Year, Fiscal Years 1995-2009 (Dollars in Thousands) Feed Cottom Dairy Grains Soybeans Wheat Other Total 2009 0; $184,499 $3,696 0 $3,534 $13,478| $205,207 2008 0 () 4,597 {} 89 6,071 10,757 2007 || $14,392 13,864 1,957 $3,346 144, 136 7,321 184,986 2006 1,204 40,906 3,835 5,257 160,921 13,916 226,039 2005 633 95, 197 4,724 37 173,281 30,314 304, 186 2004 680 605,544 21,793 | 1 291,436 30,740 950.204 2003 27,076 1.325,207 29,673 3,606 291,731 306,863; 1,984,156 2002 43,530 1,283,648 34,868 14, 105 370,042 740,360; 2,486,553 200 } 10,400 866,800 45,500 15,700 403,700 942,807 2,284,907 2000 2,300 562,200 71,600 48,400 399,600 | 19,600) 1,203,700 1999 2,600 206,400 42,300 25,100 425,700 1,200 713,300 1998 {} 128,225 21,358 1 1,700 369,967 {} 531,250 1997 100 23,047 7,300 0 346,334 2] 376,802 1996 6] 2,306 75,41 i 0| 407,510 0|| 485,288 1995 52 38,587 116,433 } 528,122 18,328 701,523 The following table shows the value of commodities disposed of during FY 2009: (Dollar in Thousands) Type of Disposition Cost Value Proceeds Domestic Sales for Dollars $5,687 $5,870 P.L. 480 (Export) Title I " 17,975 17,975 P.L. 480 (Export) Title II* 902,683 902,683 Domestic Certificate Redemption 2,797,262 },909,643 Domestic Donations - 88, 159 () Export Donations 103,869 0. Domestic Transfer to other Government Agencies. {} 0. Domestic Inventory Adjustments and/or Recoveries 1,019 884 Subtotal Domestic Dispositions 2,892,127 1,916,397 Subtotal Export Dispositions 1,024,527 920,658 Total Dispositions $3,916,654 $2,837.055 *Proceeds represent the value of commodities charged to P.L. 480 and recorded as sales. Explanation of Dispositions by Domestic Commercial Sales. For unrestricted use - Commodities acquired under support can be sold for unrestricted use domestically only at prices which are not below minimums prescribed by law. There are no similar minimums on sales of nonstorables. 160 24g-6 For restricted use - Commodities may be sold for restricted uses or outlets at less than the minimums prescribed by law. These uses would include new or by-product uses, peanuts and oilseeds sold for extraction of oil, and commodities that have substantially deteriorated in quality or are in danger of loss or WaSte CONSERVATION Conservation Activities in FY 2009 (Dollars in Thousands) - Authorized Acres CCC Net Transfer to Program or Funding Level Outlays NRCS Conservation Reserve Program 392 million 3CſCŞ $1,916,468 0 (rolling maximum) Emergency Forestry Conservation Reserve Program $23 93.4 million 9,846 {} Wetlands Reserve Program 2275 million acres -l $475,448 - (rolling maximum) Environmental Quality Incentives Program $1.2 million 0 1,067,000 Farmland Protection Program $97 million {} 121,000 Soil and Water Conservation Program o 0 0 Agricultural Management Assistance Program $1.5 million -l 7,500 Wildlife Habitat incentives Program $85 million 0 85,000 Conservation Security Program (terminated after September 30, 2008 will become the Conservation Stewardship Program ) 0 O 283,075 Grassland Reserve Program } .220 million acres 0. 48,000 Chesapeake Bay Watershed Program $23 million () 23,000 Conservation Stewardship Program $230 million 0 9,767 Agricultural Water Enhancement Program $73 million O 73,000 Healthy Forests Reserve Program $9.75 million - 0 9,750 Total $1,926,312 $2,202,540 (Authorized funding levels are based on the FY 2008 Farm Bill, P.L. 110-246, enacted June 18, 2008.) 161 24g-7 FINANCING Borrowing Authority. CCC operations are financed through borrowing from the U.S. Treasury. The FY 1988 Appropriations Act, P.L. 100-202, increased the statutory borrowing authority to $30 billion. As of September 30, 2009, $2.967 billion of this authority was in use. Reimbursement for Net Realized Losses. During FY 2009, the Corporation received $12,085.0 million for reimbursement of 2008 losses. As of September 30, 2009, unrestored realized losses totaled $15,079.2 million. These losses are financed by the Corporation's borrowing authority until reimbursed by appropriation. Section l l Activities. Section j6) of the 1996 Act amended section l l of the CCC Charter Act to limit the uses of CCC funds for reimbursable agreements and transfers and allotments of funds to State and Federal agencies. Starting 1997, total CCC funds used under that section in a fiscal year, including agreements for ADP or information technology management activities, were limited to the total of such allotments and ransfers in FY 1995 The Section 1 cap was increased in FY 2001 from $36.2 million to 56.2 million to include Farm Service Agency loan service fees of nearly $20 million based on 1995 ollection computations. Obligations in FY 2009 were $55 6 million. 162 24g-8 Summary of CCC Activities for FY 2007 through 2009 (millions of dollars) Hiem 2007Actual 2008Actual 2009 Actual Loan Activity - Loans Outstanding. Beginning of Year $1.463. ] $743.9 629.5 loans Made H1.286 i 9,509 0 8,290.9 Loans Repaid. -7.1574 -9.058 6 -4,791 6 Loans Repaid – Certificates -4,659 8 -i () -2.7973 Marketing Loans Repaid - 128 0. -7867 Collateral Acquired -76.4 -83 -46 9 Write-offs -89.2 -549.2 -78.5 Transfers to Accounts Receivable –97 -6 3 -5.4 Loans Outstanding, End of Year 743 9 629 5 4|4 0 Inventory Activity Inventory, Begunning of Year 226.0 1850 10 3 Commodity Purchases 727.0 1.1 162 1.254.7 Certificates from Loan Redemption 4,659.8 | 0 2,797.3 Collateral Acquired 76 4 8.4 46.9 Loan Collateral Settlements 4.4 {} 7 i 9 Processing. Packaging etc i0 2 –0 3 10 2 Storage and Handling (74.0) (89) (80) Transportation (0.5) (.6) (1.6) Other Transfers (net) -9.8 47 6 H Commodity Cost of Sales -5,414 8 - 1,049.0 -3.724 6 Domestic Donations -23 4 –99 4 -88 2 Export Donations -70 8 - 1994 - 103 9 lnventory, End of Year | 85.0 10 8 205 2 Direct Cash Payments: Production Fiexibility Payments aſ -0 8 -0 3 {} | Direct Payments 3.957 2 4.82 I 2 5,222 3 Counter-Cyclical Payments 3, 1586 359 | 73] I Loan Deficiency Payments | 738 6 0 #45 5 Milk Income Loss Payments 157.9 2 | 756 9 Noninsured Assistance Payments aſ 127 0 73 9 62 Conservation Reserve Payments 1,865 0 1,927.0 1.855 3 Other Conservation Payments 15 0 9 9 9.8 Other Payments c 98.0 9 985 2 { 037 6 , Total 10,434 6 8, 184 9,820 7 Commodity Export Activities CCC Export Credit Guarantee Programs (Program Level) (1.445 3) (3.640 0) (5.357 0) (Net Outlays) –67.5 - 105 ! 758 Market Access Program (Program Level) (2000) (2000) (2000) (Net Outlays) 184 ; 1792 2}8 6 Dairy Export incentive Program - (Program Level) (0) (0) (189) (Net Outlays) 0 0 } () Other: Realized Loss $2.566 9 #2 ()85 0 15,079 2 Investment in Agricultural Commodities 928.9 640 3 6 j92 aſ Reflects retunds of overpayments or accounting adjustments b/ Does not include fee collections FY 2011 Explanatory Notes Purpose Statement......................., … Statement of Available Funds and Staff Years w Permanent Positions by Grade and Staff Years............................................................. Size, Composition and Cost of Motor Vehicle Fleet * * * * * * * * * * * * * * * * * * * * * * * * * * Conservation Operations: Natural Resources Conservation Service Table of Contents b. * * * * * * * * * * * * * * * * * * * * Appropriation Language..... * w w wº y = * * * * Lead-off Tabular Statement............................................................................ Project Statement... t a s e s is a s 4 & x * * * * * * * * * * * * * * * * * * * * * * * * * * * * * Justifications...................….….....…….~~~~ Geographic Breakdown of Obligations and Staff Years................................. Classification by Objects................................................................................ User Fee Proposed Legislation .................................................. ...................” Status of Program.................. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .--------------- “... . . . . . . . Watershed and Flood Prevention Operations: Appropriation Language * * * * * * * * * * * * * * * * * * * * * * - ... --------. Lead-off Tabular Statement............................................................................ * * * * * * * 4 = s. v c q tº a y < * * * * * Justifications .............. * Geographic Breakdown of Obligations and Staff Years ~ - Classification by Objects ......................... Recovery Act......... * * & º & Status of Program.......... * * * . … Watershed Rehabilitation Program: Appropriation Language........ Lead-off Tabular Statement w- Project Statement............ - tº 4 -- . . . . . . . . . . . . . . . . . . . . . . . . ~~ Justifications ........................... * .......................... Geographic Breakdown of Obligations and Staff Years................................. Classification by Objects & e º º Recovery Act............. ..........................…................ * * Status of Program...., r * * * * * * * * * * * * * * * * * * v * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * Resource Conservation and Development: Lead-off Tabular Statement............................................................................ Project Statement Justifications y e s a v < * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * Geographic Breakdown of Obligations and Staff Years................................. Classification by Objects ................................. “.... .... ................................ Status of Program....... t Healthy Forests Reserve Program: Project Statement............................................................................................ Geographic Breakdown of Obligations and Staff Years Classification by Objects - - Food, Conservation, and Energy Act of 2008: Lead-off Tabular Statement ...... Project Statement Geographic Breakdown of Obligations and Staff Years Status of Program ... - as ºf Summary of Budget and Performance Statement of Department Goals and Objectives. Key Performance Outcomes and Measures Full Cost by Secretary’s Strategic Priorities (163) Page 25-1 25-14 25-16 25-17 25-18 25-19 25-20 25-2} 25-24 25–26 25-27 25g-i 25-28 25–29 25-29 25-3 . . 25-32 25-34 25-35 25g-25 25-39 25-40 25-40 25–4 | 25–41 25-42 25–43 25g-35 25-45 25-46 25-46 25-47 25–48 25-50 25g-39 25-54 25-5 i 25-52 25-53 25-53 25-55 25g-42 25-57 25-72 25-82 164 25-1 NATURAL RESOURCES CONSERVATION SERVICE Purpose Statement The Soil Conservation Service, established in 1935, was renamed the Natural Resources Conservation Service (NRCS) pursuant to Public Law 103-354, the Department of Agriculture Reorganization Act of 1994 (7 U.S.C. 6962). The NRCS mission statement – “Helping people help the land”—reflects the Agency’s long-standing role in providing conservation science and technology products and services to help people make sound natural resource decisions and implement measures to conserve, maintain, and enhance the lands and natural resources that they control or manage. Through this role, NRCS helps customers to achieve that balance of productive lands and a healthy environment. NRCS’ primary customers are the individuals and groups who make day-to-day decisions about natural resource use and management on non-Federal lands. They include farmers, ranchers, and other land managers; units of government; non-profit organizations; and others involved in agriculture or natural resource management. NRCS helps these customers take a comprehensive approach to the use and protection of their soil, water, and related natural resources. These cooperative conservation activities benefit directly or indirectly all of the people of the Nation. NRCS assists customers in the accomplishment of their conservation objectives by providing products an services through five business lines: 1. Conservation Planning and Technical Consultations. NRCS provides data, information, and technical expertise to help customers collect and analyze information to identify natural resource problems and opportunities, clarify their objectives, and formulate and evaluate alternatives; 2. Conservation Implementation. NRCS helps customers install natural resource conservation practices and systems that meet established technical standards and specifications; 3. Natural Resources Inventory and Assessment. NRCS assesses, acquires, develops, interprets, and delivers natural resource data and information to enable knowledge-based planning and decision making at all landscape scales; - 4. Natural Resource Technology Transfer. NRCS develops, documents, and distributes a wide array of technology pertaining to resources assessment, conservation planning and conservation system installation and evaluation; and 5. Financial Assistance. NRCS provides cost share and monetary incentives to encourage the adoption C conservation practices that have been proven to provide significant public benefits. Financial assistance is awarded to participants who voluntarily enter into contracts, easements and agreements t conserve natural resources. - - NRCS assistance to individual landowners is provided cooperatively through conservation districts, which are units of local government created by State law. NRCS works in partnership with the State conservatio agencies and other State and local agencies such as resource conservation and development councils, locally elected or appointed farmer committees, Federal agencies, Tribal governments, and private sector organizations. NRCS employees help people understand the natural processes that shape their environment, how conservation measures can improve the quality of that environment, and the benefits of partnerships with their neighbors in a common approach to build a landscape that supports a productive agriculture and natural resource quality. - NRCS helps people achieve these outcomes through the following authorized and funded programs of the Department of Agriculture: Conservation Operations is authorized by the Soil Conservation and Domestic Allotment Act of 1935, P.L. 74–46 (16 U.S.C. 590a-590f) and the Soil and Water Resources Conservation Act of 1977, (16 U.S.C 2001-2009). The purpose of Conservation Operations is to provide technical assistance supported by science-based technology and tools that help people conserve, maintain, and improve the Nation’s natural resources. Conservation Operations contains four sub-accounts: 1) Conservation Technical Assistance 165 25-2 CTA); 2) SoilSurveys; 3) Snow Survey and Water Supply Forecasting (SS/WSF); and 4) Plant Materials Senters (PMC). - - Conservation Technical Assistance Program (CTA): The CTA Program is the cornerstone of all USDA conservation programs. The program helps private landowners, conservation districts, Tribes, and other organizations through technical assistance to plan, design and implement conservation practices, and systems. The program delivers this assistance through a national network of locally- respected, technically skilled, professional conservationists. These conservationists deliver consistent, science-based, site-specific solutions to help private landowners conserve, maintain, and improve the Nation’s natural resource base. The CTA Program works in partnership with other cooperative conservation programs to leverage the Federal investment in order to achieve national priorities without duplicating local and State efforts. The program is the conservation foundation for the Nation's private lands and Tribal lands conservation assistance infrastructure and brings to bear the technical expertise to get sound conservation solutions applied on the ground. The CTA Program provides proven and consistent conservation technology and a delivery infrastructure for achieving the benefits of a healthy and productive landscape, and has the following purposes: - • Reduce soil loss from erosion. - • Solve soil, water quality, water conservation, air quality, and agricultural waste management problems. • Reduce potential damage caused by excess water and sedimentation or drought. • Enhance the quality of fish and wildlife habitat. - - - • Improve the long term sustainability of all lands, including cropland, forestland, grazing lands, coastal lands, and developed and/or developing lands. - • Assist others in facilitating changes in land use as needed for natural resource protection and sustainability. - - - Specific objectives of CTA are to: - • Provide conservation technical assistance to individuals or groups of decision makers, communities, conservation districts, units of State and local government, Tribes, and others to voluntarily conserve, maintain, and improve natural resources. • Provide collaborative community, watershed, and area-wide technical assistance with units of government, so they can develop and implement resource management plans that conserve, maintain and improve our natural resources. • Provide conservation technical assistance to agricultural producers to comply with the Highly Erodible Land (HEL) and Wetland (Swampbuster) Conservation Compliance Provisions of the 1985 Food Security Act, as amended by past and future Farm Bills. • Provide conservation technical assistance to decision-makers in order for them to comply with Federal, State, Tribal, and local environmental regulations and related requirements, and prepare them to become eligible to participate in other Federal, State, and local conservation programs. • Provide soils information and interpretation to individuals or groups of decision-makers, communities, States, and others to aid sound decision making in the wise use and management of soil resources. . . . . - • Collect, analyze, interpret, display, and disseminate information about the status, condition, and trend of soil, water, and related natural resources so people can make informed decisions for natural resource use and management. - - - Assess the effects of conservation practices and systems on the condition of natural resources. • Develop, adapt, and transfer effective science-based technologies and tools for assessment, management, and conservation of natural resources. Soil Surveys. NRCs helps people understand and use soils within their capability. Soil surveys provide the public with information on the properties, capabilities and conservation treatment needs of 166 25-3 their soil. Based on scientific analysis and classification of the soils, soil surveys include maps and interpretations with explanatory information for a county or designated area. Soil Surveys are completed for approximately 92 percent of the United States and its territories. Soil survey is the foundation of resource planning by land-users and for policy making for Federal, State, county, and local community programs. NRCS conducts soil surveys cooperatively with other Federal agencies, land grant universities, State agencies, and local units of government. The major objectives of the Soi Survey Program are to: - - Inventory and map the soil resource on all lands of the United States. Keep soil survey relevant to meet emerging and ever-changing needs, Interpret the data and make soil survey information available to meet public needs. Promote and provide technical assistance in the use of soil survey information. Lead the National Cooperative Soil Survey Program. - 3. Snow Surveys and Water Supply Forecasts (SS/WSF). The SS/WSF Program collects high elevation snow data in the Western United States and provides managers and users with snowpack data and water supply forecasts. NRCS field staff collects and analyzes data on snow depth, snow water equivalent, and other climate parameters at more than 2,000 mountain sites. The program is transitioning to an automated system which provides real time data. Approximately 790 of the data collection sites are currently automated. The data are used to provide estimates of annual water availability, spring runoff, and summer stream flows. These water supply forecasts are used by individuals, Tribes, organizations, and units of government for decisions relating to agricultural production, fish and wildlife management, municipal and industrial water supply, urban development, flood control, recreation, power generation, and water quality management. The National Weather Service includes these forecasts in their river forecasting function. Reports on the snowpack characteristics are used by the ski industry, transportation departments and others to plan their season work in mountain areas. The objectives of the program are to: • Provide reliable, accurate and timely forecasts of surface water supply to water managers and water users in the west. - • Efficiently obtain, manage, and disseminate high quality data and information on snow, water, climate, and hydrologic conditions. • Provide climate data to support NRCS conservation planning tools. 4. Plant Material Centers. The Plant Materials Centers (PMCs) identify, test and evaluate the performance of plants and plant technologies to solve natural resource problems and improve the utilization of natural resources including erosion reduction, wetland restoration, water quality improvement, wildlife habitat improvement (including pollinators), streambank and riparian area protection, coastal dune stabilization, biomass production, an quality and other conservation treatment needs. The tested and proven plant materials released by PMCs are used to restore the environment to a healthy condition after natural disasters and human induced disturbances. PMCs also evaluate and develop improved technologies for the production, establishment, and management of plants used in conservation systems. PMCs release new plants to the private sector which helps to stimulate the national economy and provide the large-scale increase of seed and plants necessary for implementatio of the conservation programs of the Farm Bill. Commercial sales of PMC released plants generate over $100 million a year in revenue. In addition to new plants, PMCs prepare technical documents an conduct training. There are over 2,500 documents available from the Web describing how to select and use plants for conserving or improving natural resources. The work at the 27 PMCs is located throughout the Agency carried out cooperatively with State and Federal agencies, universities, Tribes, commercial businesses, and seed and nursery associations. PMC activities directly benefit private landowners as well as Federal and State land managing agencies. Watershed and Flood Prevention Operations includes Watershed Operations authorized by P.L. 78-534 the Flood Control Act of 1944 (33 U.S.C. 701b-1), and Small Watersheds authorized by P.L. 83-566, as amended (16 U.S.C. 1001-1008). - - - 167 25-4 Through these programs, NRCS cooperates with State and local agencies, Tribal governments, and other Federal agencies to prevent damages caused by erosion, floodwater, and sediment and to further the conservation, development, utilization, and disposal of water and the conservation and utilization of land. The P.L. 83-566 program is available nationwide to protect and improve watersheds up to 250,000 acres in size. Currently, there are approximately 297 active small watershed projects throughout the country. P.L. 78-534 is available only in areas authorized by Congress; these areas cover about 38 million acres in 11 States. Objectives of the program are to provide technical and financial assistance for disaster cleanup and Subsequent rebuilding; stream corridor, and floodplain restoration; and for urban planning and site location assistance to the Federal Emergency Management Agency when relocating communities out of floodplains. Emergency Watershed Protection Program (EWP) is authorized by Section 216, P.L. 81-516, (33 U.S.C. 701b-1) and Sections 403-405, P.L. 95-334 (16 U.S.C. 2203-2205). The 1996 Farm Bill amended Section 403 of the Agricultural Credit Act of 1978 (P.L. 95-334) (16 U.S.C. 2203) by including the purchase of floodplain easements under the Emergency Watershed Protection Program. The EWP program reduces hazards to life and property in watersheds damaged by severe natural events. An emergency exists when a watershed is suddenly impaired by flood, fire, drought, or other natural causes that results in life and property being endangered by flooding, erosion, sediment discharge or other associated hazards. The emergency area need not be declared a national disaster area to be eligible for assistance. Objectives of the program are to provide technical and financial assistance for disaster cleanup and subsequent rebuilding; stream corridor, wetland, and riparian area restoration; and for urban planning and site location assistance to Federal Emergency Management Agency when relocating communities out of floodplains. Local people are generally employed on a short-term basis to assist with disaster recovery. Activities include establishing quick vegetative cover on denuded land, sloping steep land, and eroding banks; opening dangerously restricted channels; repairing diversions and levees; purchasing flood plain easements; and other emergency work. - Watershed Rehabilitation Program is authorized under Section 14 of the Watershed Protection and Flood Prevention Act approved August 4, 1954, as amended by Section 313 of Public Law 106–472, November 9, 2000. This program assists communities in addressing public health and safety concerns and environmental impacts of aging dams. Technical and financial assistance is provided for the planning, design, and implementation of rehabilitation projects that may include upgrading or removing the dams. The program may provide up to 65 percent of the total cost of the rehabilitation projects; Federal funds cannot be used for operation and maintenance. Resource Conservation and Development (RC&D) is authorized by Section 102 of the Food and Agriculture Act of 1962 (P.L. 87-703), (7 U.S.C. 1010-1011) and Sections 1528-1538 of the Agriculture and Food Act of 1981 (P.L. 97-98). Section 383 of the 1996 Farm Bill (P.L. 104-127) (16 U.S.C. 3461) extended the RC&D program authority. Section 2504 of the 2002 Farm Bill removed the sunset provisions previously placed on this program. Section 2805 - Subtitle I of The Food, Conservation, and Energy Act of 2008 states that “To improve the provision of technical assistance to councils under this subtitle, the Secretary shall designate for each council an individual to be the coordinator for the council”. RC&D improves the capability of State and local units of government and local non-profit organizations in rural areas to plan, develop, and carry out programs for resource conservation and development. RC&D plans may address land conservation, water management, community development, or other elements including energy conservation, protection of agricultural land, or protection of fish and wildlife habitats. RC&D is initiated and directed at the local level by volunteers. A typical RC&D area encompasses multiple communities, various units of government, Tribes, municipalities, and grassroots organizations. The program serves as a catalyst for these civic groups to share knowledge and resources in a collective attempt to solve common problems facing their region. RC&D councils obtain assistance from the private sector, Tribes, corporations, foundations, and all levels of government. 168 25–5 Wetlands Reserve Program (WRP) is authorized under Section 1237 of the Food Security Act of 1985 (P.L. 99-198), as amended. Funding is provided through the Commodity Credit Corporation (CCC). The Food, Conservation and Energy Act of 2008 (P.L.110-246) reauthorized the WRP through Fiscal Year 2012 and provided for a total acreage enrollment cap of 3,041,200 acres. WRP preserves, protects, and restores eligible wetlands. Wetland restoration and protection improves wildlife habitat and water quality, and provides flood water retention, ground water recharge, open space, and aesthetic values. NRCS enrolls lands in this program in permanent easements, 30-year easements, 30- year contracts for acreage owned by Indian Tribes, and restoration cost share agreements on private lands. The 2008 Farm Bill also provided a new enrollment type of a 30-year contract for acreage owned by Indian Tribes. NRCS enters into easements and contracts with landowners of eligible wetlands and associated buffer areas, as well as riparian areas that link two protected wetlands. NRCS and the Fish and Wildlife Service provide technical assistance for WRP. Environmental Quality Incentives Program (EQIP) was re-authorized by Section 2501 of the Food, Conservation, and Energy Act of 2008 (P.L. 110-246). EQIP provides a flexible, voluntary conservation program for farmers and ranchers and promotes agricultural production, forest management and environmental quality as compatible national goals to optimize environmental benefits. EQIP offers financial and technical assistance to eligible participants to install or implement conservation practices including those related to organic production on eligible agricultural land. EQIP offers contracts with a minimum term that ends one year after the implementation of the last scheduled practices and a maximum term of ten years. These contracts provide financial assistance payments to implement approved conservation practices. Persons who are engaged in livestock or agricultural production or landowners who have an interest in an agricultural operation on eligible land may participate in EQIP. EQIP activities are carried out according to a plan of operations developed with the producer that identifies the appropriate conservation practice to address the identified resource concern(s). These practices must meet NRCS technical standards adapted for local conditions. EQIP payment rates may be up to 75 percent of the costs of certain conservation practices. Socially disadvantaged, limited resource, or beginning farmers and ranchers may be eligible for payment rates up to 90 percent. Farmers and ranchers may elect to use a certified technical service provider instead of NRCS for technical assistance. - An individual or entity may not receive, directly or indirectly, conservation payments that, in the aggregate, exceed $300,000 during the period of FY 2009 through FY 2014. Technical assistance payments do not count against this limitation. A waiver of the $300,000 limit may be requested for projects of special environmental significance that will result in significant environmental improvements as determined by NRCS policy. At least 60 percent of funding must be targeted to practices relating to livestock production. NRCS establishes policies, priorities, and guidelines for the program and provides technical leadership and financial assistance. - - - Agricultural Water Enhancement Program (AWEP) was authorized by Section 2510 of the Food, Conservation, and Energy Act of 2008 (P.L. 110-246). AWEP is a voluntary conservation program that provides financial and technical assistance to agricultural producers to implement agricultural water enhancement activities on agricultural land for the purposes of conserving surface and ground water and improving water quality. Under AWEP, NRCS enters into partnership agreements with eligible entities that want to promote ground and surface water conservation or improve water quality on agricultural lands. After AWEP project areas are approved by NRCS, eligible producers may submit a program application. All agricultural producers receiving assistance through AWEP must meet the EQIP eligibility requirements and will be subject to EQIP payment limitations. AWEP offers contracts with a minimum term that ends one year after the implementation of the last scheduled practices and a maximum term of ten years. These contracts provide financial assistance 169 25-6 payments to implement approved conservation practices. Persons who are engaged in livestock or agricultural production or landowners who have an interest in an agricultural operation on eligible land may participate in AWEP. AWEP activities are carried out according to a plan of operations developed in conjunction with the producer that identifies the appropriate conservation practice that addresses the identified ground and surface water resource concern(s). These practices must meet NRCS technical standards adapted for local conditions. - AWEP payment rates may be up to 75 percent of the costs of certain conservation practices. Socially disadvantaged, limited resource, or beginning farmers and ranchers may be eligible for payment rates up to 90 percent. Farmers and ranchers may elect to use a certified technical service provider for technical assistance. An individual or entity may not receive, directly or indirectly, conservation payments that, in the aggregate, exceed $300,000 during the period of FY 2009 through FY 2014. Technical assistance payments do not count against this limitation. A waiver of the $300,000 limit may be requested for projects of special environmental significance that will result in significant environmental improverments as determined by NRCS policy. NRCS establishes policies, priorities, and guidelines for the program and provides technical leadership and financial assistance. Wildlife Habitat Incentives Program (WHIP) was authorized by Section 1240N of the Food Security Act of 1985, as amended by Section 2502 of the Farm Security and Rural Investment Act (P.L. 107-171) of the 2002 Farm Bill. WHIP was reauthorized under Section 2602 of the Food, Conservation, and Energy Act of 2008 (P.L. 110-246). WHIP develops habitat for upland wildlife, wetlands wildlife, threatened and endangered species, fish, and other types of wildlife including habitat developed on pivot corners and irregular areas. NRCS provides technical and financial assistance to landowners to improve wildlife habitat n their property. NRCS enters into cost-share agreements with landowners for a minimum duration of one ear after the completion of conservation practices identified in the WHIP plan of operations, but not more an ten years, providing up to 75 percent of the funds needed to implement wildlife habitat development ractices. The 2008 Farm Bill authorized NRCS to use up to 25 percent of total funds to provide additional ost-share assistance of up to 90 percent to landowners who enter into 15-year agreements for the purpose f protecting or restoring essential plant and animal habitat. arm and Ranch Lands Protection Program (FRPP). Section 2401 of the Food, Conservation and nergy Act of 2008 (P.L. 110–246) re-authorized the Farmland Protection Program originally authorized by e Federal Agriculture Improvement and Reform Act of 1996. The 2003 Final Rule renamed the program e Farm and Ranch Lands Protection Program (FRPP) to better describe the lands protected by the rogram. FRPP protects the agricultural use and related conservation values of farmland by limiting onagricultural uses. Eligible land includes farm or ranch land that has prime, unique, or other productive oil, contains historical or archaeological resources, or supports the policies of a State or local farm and anch land protection program. Landowners must meet the adjusted gross income, highly erodible land, nd wetland conservation requirements of the 2008 Farm Bill. NRCS facilitates and provides funding for he purchase of conservation easements with eligible State, local and Tribal governments and nongovernmental organizations that administer farmland protection programs. Eligible entities must have established farmland protection programs, established policies for title and appraisal, the staff and budget to administer the acquisition of the easement and monitor and enforce the conservation easement deed, and he matching-funds at the time of application. Eligible entities that have demonstrated proficiency in administering easements in FRPP qualify as “certified’ eligible entities. The certified eligible entity status entitles the entities to enter into cooperative agreements in which NRCS can obligate five years of funding. NRCS can obligate three years of funding in agreements with non-certified eligible entities. The parcels submitted by the entities must be ranked and compete for funding each year. The certified entity status loes not guarantee that the entity will have funding obligated in each year of the agreement. NRCS may provide up to 50 percent of the fair market value of the conservation easement; the eligible entity and the andowner must contribute at least 50 percent of the fair market value of the conservation easement. The :ligible entity must contribute a minimum of 25 percent of the purchase price of the easement (the !ppraised fair market value munus the landowner donation) in cash. There is no limit on the amount of the andowner donation. The conservation easements are held by the cooperating entity and NRCS holds a 170 25-7 contingent right of enforcement in the easement. To be eligible, land must be subject to a pending offer from an eligible entity. A conservation plan must be developed for any highly erodible cropland associated with the conservation easement. Conservation Security Program (CSP) was authorized by the Farm Security and Rural Investment Act of 2002. Title II, Subtitle a, Section 2001 amends the Food Security Act of 1985 by adding Chapter 2, Subchapter A, the Conservation Security Program. CSP is a voluntary program that provides financial and technical assistance for the conservation, protection, and improvement of natural resources on Tribal and private working lands. The program provides payments for producers who practice good stewardship on their agricultural lands and incentives for those who want to do more, Equitable access was provided to all producers in all 50 states, the Caribbean Area, and the Pacific Basin Area, regardless of size of operation, crops produced or geographic location. CSP is a resource concern driven program, not conservation practice driven. Section 1202(a) of the Deficit Reduction Act of 2005 extended CSP into 2011. The program was not reauthorized by Food, Conservation, and Energy Act of 2008 (P.L. 110–246), which stipulated that a conservation security program contract may not be entered into or renewed after September 30, 2008. The Secretary shall make payments on contracts entered before September 30, 2008 using such sums as are necessary, - Conservation Stewardship Program (CSP) was authorized by the Food, Conservation, and Energy Act of 2008 (P.L. 110-246), which amended the Food Security Act of 1985 to authorize the program in Fiscal Years 2009 through 2012. The purpose of CSP is to encourage producers to address resource concerns in a comprehensive manner by: (1) undertaking additional conservation activities; and (2) improving, maintaining, and managing existing conservation activities. During the period beginning on October 1, 2008, and ending on September 30, 2017, the Secretary of Agriculture shall, to the maximum extent practicable - “(1) enroll in the program an additional 12,769,000 acres for each fiscal year”; and “(2) manage the program to achieve a national average rate of $18 per acre, which shall include the costs of all financial assistance, technical assistance, and any other expenses associated with enrollment or participation in the program”. The initial sign-up for the CSP program was held from August 10, 2009, through September 30, 2009. Grassland Reserve Program (GRP) is authorized by the Food, Conservation, and Energy Act of 2008 (P.L. 110-246). GRP assists landowners and operators in restoring and protecting grazing uses and related conservation values. The program has a 1,220,000 acre cap. The program offers several enrollment options: permanent easements, cooperative agreements, rental contracts and restoration agreements. Farm Service Agency (FSA) responsibilities include accepting applications; issuing payments; assessing penalties and liquidated damages as applicable; accepting, modifying and terminating rental contracts; landowner eligibility determinations on easement and rental contracts; acreage determination on rental contracts; maintaining GRP records and reports and enforcement of violations on rental contracts. NRCS responsibilities include accepting applications, providing technical assistance to the participant, evaluating and ranking applications for rental contracts and easements, ensuring conservation treatment is in accordance to program requirements, ranking and selecting applications for funding, providing payment documentation to FSA and establishing quality assurance and control procedures to monitor land enrolled in easements or rental contracts. - - . Agricultural Management Assistance Program (AMA) is authorized by Section 211 of the Agricultural Risk Protection Act of 2000 (P.L. 106-224). Subtitle I, Section 2801 (b)(2)(ii) of the Food, Conservation, and Energy Act of 2008 (P.L. 110-246) authorizes $15 million annually for financial assistance in 16 States, as determined by the Secretary, in which participation in the Federal Crop Insurance Program is historically low. Financial assistance is provided through CCC. The 16 States designated by the 2008 Farm Bill to participate in the program are Connecticut, Delaware, Hawaii, Maine, Maryland, Massachusetts, Nevada, New Hampshire, New Jersey, New York, Pennsylvania, Rhode Island, Utah, Vermont, West Virginia, and Wyoming. NRCS provides AMA financial assistance to producers to 171 25-8 construct or improve water management structures or irrigation structures; plant trees for windbreaks or improve water quality. The program also offers financial assistance to mitigate crop failure risks through production diversification or resource conservation practices, including soil erosion control, integrated pest nagement, and transition to organic farming. e Risk Management Agency provides AMA financial assistance to producers purchasing crop insurance o reduce revenue risk. The Agricultural Marketing Service provides AMA financial assistance to program articipants receiving certification or continuation of certification as being an organic producer. hesapeake Bay Watershed Program (CBWP) is authorized by Section 12400 of the Food Security Act, as added by the Food, Conservation, and Energy Act of 2008 (P.L. 110–246). Section 12400 established the CBWP and defined the Chesapeake Bay Watershed to mean all tributaries, backwaters, and side channels, including their watersheds, draining into the Chesapeake Bay. This area includes portions of the States of Delaware, Maryland, New York, Pennsylvania, Virginia, and West Virginia. The program gives special, but not exclusive consideration to the following river basins: Susquehanna River, Shenandoah River, Potomac River (including North and South Potomac), and the Patuxent River. The CBWP helps agricultural producers improve water quality and quantity, and restore, enhance, and preserve soil, air, and related resources in the Chesapeake Bay Watershed through the implementation of conservation practices. These conservation practices reduce soil erosion and nutrient levels in ground and surface water, improve, restore, and enhance wildlife habitat, and help address air quality and related natural resource concerns. To carry out the CBWP, NRCS may chose to use any of the following Farm Bill programs: Wetlands Reserve Program; Environmental Quality Incentives Program; Ground and Surface Water; Agricultural Water Enhancement Program; Wildlife Habitat Incentives Program; Farm and Ranch Lands Protection Program; Conservation Security Program; Conservation Stewardship Program; Grasslands Reserve Program; Agricultural Management Assistance; Small Watershed Rehabilitation Program; Healthy Forests Reserve Program; or Conservation Reserve Program as authorized under subtitle D, Title XII of the Food Security Act of 1985, 16 U.S.C. 3830–3839bb–5. Healthy Forests Reserve Program (HFRP) is authorized by Title V of the Healthy Forests Restoration Act of 2003 (P.L. 108-148) as amended by the Food, Conservation and Energy Act of 2008 (P.L. 110-246), luthorized to be carried out from FY 2009 through FY 2012. HFRP assists landowners in restoring, inhancing, and protecting forest ecosystems on private lands to promote the recovery of threatened and indangered species; improve biodiversity; and enhance carbon sequestration. The four HFRP enrollment »ptions include a 10-year cost-share agreement, a 30-year easement, a 30-year contract (for Indian Tribes inly), and a permanent easement. Land enrolled in the HFRP must have a restoration plan that includes ractices necessary to restore and enhance habitat for species listed as threatened or endangered or species or candidates for the threatened or endangered species list. All the options include cost-share payments for mplementation of the required practices. - Cooperative Conservation Partnership Initiative (CCPI) was authorized by Section 2707 of the Food Donservation and Energy Act of 2008 (P.L. 110-246), which establishes the CCPI by amending Section 243 of the Food Security Act of 1985 (16 U.S.C. 3843), CCPI is a voluntary conservation initiative that nables the use of certain conservation programs along with resources of eligible partners to provide inancial and technical assistance to owners and operators of agricultural and nomindustrial private forest ds. Eligible producers who participate in a project are identified in an approved partner agreement and ave an active application in one of the eligible programs may be approved for assistance. Eligible rograms include: Environmental Quality Incentives Program (EQIP), Wildlife Habitat Incentive Program IP), and the Conservation Stewardship Program (CSP). Under CCPI, NRCS enters into partnership greements with eligible entities that want to enhance conservation outcomes on agricultural and lonindustrial private forest lands. The intent of CCPI is for the Federal Government to leverage investment n natural resources conservation along with services and resources of non-Federal partners. Six percent of unds and acres available each Fiscal Year shall be reserved to implement CCPI. State Conservationists will administer ninety percent of the funds and ten percent will fund projects based on a national ompetitive process. - 172 25-9 Eligible partners include Federally recognized Indian Tribes, State and local units of government, producer associations, farmer cooperatives, institutions of higher education, or nongovernmental organizations with a history of working cooperatively with producers. The purposes of a CCPI partnership agreement, which can be no longer than five years, are to: - • Address conservation priorities involving agriculture and nonindustrial private forest land on a local, State, multistate, or regional level. • Encourage producers to cooperate in meeting applicable Federal, State, and local regulatory requirements related to production. - • Encourage producers to cooperate in the installation and maintenance of conservation practices that affect multiple agricultural or nonindustrial private forest lands. - • Promote the development and demonstration of innovative conservation practices and delivery methods, including those for specialty crop and organic production, and precision agriculture producers. Owners and operators of agricultural and nonindustrial private forest lands are eligible to apply for program benefits offered through CCPI. In order for a producer to be considered for financial assistance through a CCPI partner agreement, the land associated with a program application must be located within an - approved CCPI project area. Only producers who are eligible for EQIP, WHIP or CSP may receive financial assistance through these programs. Technical Service Provider Assistance was authorized under Section 1242 of the 1985 Food Security Ac as amended by the Farm Security and Rural Investment Act of 2002. Section 2701 of the 2002 Farm Bill amended Section 1242 of the Food Security Act to require the Secretary of Agriculture to provide technica assistance under the Food Security Act Title XII conservation programs to a producer eligible for that assistance “directly ... or at the option of the producer, through a payment ... to the producer for an approved third party, if available.” Section 2706 of the Food, Conservation, and Energy Act of 2008 further amended Section 1242 adding a third option to provide assistance to an eligible participant “through an agreement with a third party provider” and added the Agricultural Management Assistance Program to the list of eligible programs. Section 1242 requires that USDA establish a system for approving individual and entities to provide technical assistance to carry out conservation programs, and establish the amounts and methods for payments for that assistance. Technical assistance includes conservation planning and conservation practice implementation, - - The Secretary of Agriculture delegated authority to implement Section 1242 to NRCS. NRCS implementation objectives of the provision include: 1) policy, procedures, and processes that provide efficient, effective, and timely technical services; 2) a process where conservation program participants ca take full advantage of the marketplace and obtain cost-effective delivery of quality technical services; and 3) technical services that are provided in a manner that optimizes conservation benefits. Assistance through technical service providers expands the Agency’s ability to provide products and services that enable people to be good stewards of the Nation’s soil, water and related natural resources on non-Federal land. i - - Workforce Status and Location. As of September 30, 2009, NRCS had 11,220 full-time employees with permanent appointments and 629 part-time or intermittent employees. Of this total, 408 employees are located in the Washington, D.C. Metropolitan Area and 11,441 employees located outside of the Washington, D.C., Metropolitan Area. Organizational Structure. NRCS is a line and staff organization. The line authority begins with the Chief and extends through regional conservationists, state conservationists, area conservationists, and is finally vested with district conservationists. Line officers are responsible for direct assistance to the public, Staff positions furnish specialized technical or administrative assistance to line officers. More than 98 percent of the approximately 3,800 NRCS offices are in the field. Staffs in these offices either provide 173 25-10 direct customer service or critical technical and administrative support. The following is a brief description. of the principal functions of NRCS offices: Customer Service Offices. Eighty-two percent of NRCS offices either provide the Agency’s broad spectrum of natural resource technical and financial assistance products and services to customers, or a ore focused service such as rural community development. - • Service Center Offices. Most employees provide front-line, personalized, one-on-one customer service from field offices that constitute 72 percent of NRCS offices. Employees in these offices provide customers with technical and financial assistance through the Agency’s five business lines; as a result of this help, customers prevent or solve natural resource problems on their land and in their communities. Service center office staff work side-by-side with employees of the local conservation districts and State conservation agencies. These offices function as a clearinghouse for matural resource information, helping people gain access to knowledge and assistance available from local, State, regional, and national sources. Service center offices are located in all States, Puerto Rico, U.S. Virgin Islands, American Samoa, Guam, the Northern Mariana Islands, Micronesia, Palau, and the Marshall Islands. Ninety-one percent of these 2,761 field offices are NRCS Service Center offices and are co-located with offices of Rural Development and/or Farm Services Agency; the remainder are program delivery offices generally located with conservation districts. - Specialized Offices. Another ten percent of NRCS field offices (377) provide customer service that is more specialized such as the rural community development through Resource Conservation and Development offices or offices focused on delivering technical or financial assistance for water quality improvement. - upport Offices. Fourteen percent of NRCS’ 3,800 offices in the field house employees who provide ritical technical and administrative support to customer service offices. The other field-located offices clude: 1) Area offices that provide administrative and technical support to a group of service center ffices (these offices are generally used in larger States); 2) Project offices that are headquarters for atershed or river basin planning and construction activities; 3) Soil survey offices that inventory and map e soil resource on private lands resulting in current and consistent interpretations and data sets; and 4) lant Material Centers that test, select and release plants for conservation purposes in selected plant growth egions throughout the United States. - - tate Offices. These 51 offices provide program planning and direction, consistency and accountability, nd administration of a comprehensive soil, water, and related resource conservation program for each State, Pacific Islands Area and Caribbean Area. State offices also have the responsibility for the technical integrity of the NRCS activities; National echnology transfer and training; resºners, sº marketing of the agency programs and Other 29% Support Offices nitiatives; and administrative 13 9% yperations and processing. State offices bartner with other Federal and State gencies to provide solutions to State esource issues. A State Donservationist heads the NRCS }rganization in each State except Hawaii. In the Pacific Islands Area, which includes Hawaii, and the *::::: º: Caribbean Area, Directors serve a eadership role similar to State Conservationists. - Specialized Offices 9 9% National Headquarters (NHQ). NRCS assumes the departmental leadership for programs and other ctivities assigned by the Secretary of Agriculture, through the Under Secretary for Natural Resources and invironment. The Chief, with the assistance of the Associate Chief and Deputy Chiefs, carries out NHQ unctions. Those functions include: 1) planning, formulation and direction of NRCS programs, budgets, 174 25-11 and activities; 2) development of program policy, budgets, procedures, guidelines and standards; 3) leadership and coordination with other agencies, constituent groups and organizations; 4) workload assessment and operations management; 5) oversight and evaluation activities and coordination of corrective actions; and 6) strategic planning and strategic initiative development. NHQ is responsible for the framework for national technology development and delivery within the Agency. Natural resource technology is developed and delivered through six national headquarters divisions, 11 national centers (agricultural wildlife conservation; cartography and geospatial; design, construction and soil mechanics; plant data; soil survey; water management; water and climate; information technology; employee development; geospatial development and agroforestry), and three National Technology Support Centers (NTSC). NTSCs acquire and/or develop new science and technology in order to provide cutting-edge technological support and direct assistance, and technology transfer to States, Pacific Islands Area and the Caribbean Area. These Centers also develop and maintain national technical standards and other technological procedures and references. Accountability. NRCS accountability system includes: • Program/operational and administrative controls, including the Accountability Information Management System (AIMS) which is both web-based and location-based. AIMS provides real time information on Agency budget, performance and results to anyone who clicks on the Accountability tab on the www.nrcs.usda.gov web-site. - • State quality assurance plans addressing State quality assurance processes, quality control issues, and producer compliance activities. Plans are updated, and findings and corrective actions are reported annually. - - • The Audit tracking system that monitors the progress of various oversight activities by internal and external auditors, - • Customer conformance reviews which assess performance of clients in meeting requirements of the conservation program. Customer conformance is determined using compliance and conservation program contract reviews. • National internal management reviews on high risk areas of concern in programs, operations management, financial management, human resources, civil rights and functional areas. Around 40 on-site reviews are usually carried out on an annual basis. Deficiency findings result in management actions directed toward eliminating the deficiencies. Thirty-nine studies were carried out in FY 2009. In FY 2009 and continuing into FY 2010, NRCS continues upgrading the accountability software applications and hardware security to correctly safeguard all private and sensitive information and meet the requirements of the Federal Information Security Management Act. Strategic Plan. The NRCS Strategic Plan establishes four mission goals and eight outcomes: 1. High Quality, Productive Soils - • Soil Quality. The quality of intensively used soils is maintained or enhanced to enable sustained production of a safe, healthy and abundant food and fiber supply. 2. Clean And Abundant Water • Water Quality. The quality of surface water and groundwater is improved and maintained to protect human health, support a healthy environment, and enable productive use of the land. • Water Quantity. Water is conserved and protected to ensure an abundant and reliable supply for the Nation. - - 3. Clean Air - • Air Quality. Farmers and ranchers make a positive contribution to local air quality. 4. Healthy Plant And Animal Communities - • Grassland and Rangeland. Grassland and rangeland ecosystems are productive, diverse, and resilient, and provide a wide variety of environmental services. - • Forest Land. Healthy forest lands that are productive, diverse, and resilient, and provide a wide range of ecosystem services. 175 25-12 • Fish and Wildlife Habitat. Working lands and waters provide habitat for diverse and healthy wildlife, aquatic species, and plant communities. - • Wetlands. Wetlands provide high quality habitat for migratory birds and other wildlife, protect water quality, and reduce flood damages. NRCS leadership continues an aggressive effort to ensure effective implementation of the Agency strategic plan. That effort includes: G Implementation of a communications strategy to reach across the Agency, USDA, and other Federal counterparts, as well as to partners, customers, and other entities. Definition and prioritization of critical Implementation needs by Agency leadership. Integration of actions that support strategic priorities into business plans at National Headquarters and in States offices. Revision of Agency annual performance measures and personnel performance plan metrics to align clearly with strategic plan priorities and ensure a workable approach to report on progress. Completed and On-going Audits FY 2009 General Accounting Office (GAO) and Office of Inspector General (OIG) completed audits: GAO 120696 Global Positioning System (May 2008), Final report (GAO-09-325) posted in May 2009. Audit closed. GAO 310889 Cybersecurity Strategy Review (November 2008). Final report (GAO-09-432T) posted in March 2009. Audit closed. - GAO 320572 Provincial Reconstruction Team (PRT) staffing in Iraq and Afghanistan (January 2008). Final report (GAO-09-86R) posted in January 2008, Audit closed. GAO 360965 Alaska Native Village Flooding and Erosion (May 2008). Final report (GAO-09-551) posted in June 2009. Audit closed. GAO 360978 USDA Bio-fuel Efforts (September 2008). Final report (GAO-09-446) posted in October 2009. Audit closed. - GAO 360980 Status of Endangered Species Act Issues (August 2008). Final report (GAO-03-976) posted in December 2008. Audit warranted no recommendations. Audit closed. GAO-361003-Air Quality in Great Basin National Park (October 2008). Final report (GAO-09-788R) posted in July 2009, The report is a non-audit and agencies were not asked for comments. Audit closed, . GAO 360777 USDA Civil Rights Performance (November 2006), Final report (GAO-08-755T) posted in May 2008. Audit closed. GAO 450241 Review of Administrative Remedies in the Federal Employee EEO Complaint Process (February 2007). Final report (GAO-09-712) posted in May 2008. Audit closed. GAO 460579 Critical Infrastructure Protection Coordination Issues (December 2005). Department of Homeland Security had lead for this audit. Final report (GAO-07-39) posted in October 2006. Audit closed. - OIG 10001-1-HY Review Contract Administration at NRCS to Support Hurricane Relief Efforts (January 2006). Final report issued March 2007. Audit closed. OIG 10601-5-CH Review of Controls Over Technical Service Providers (October 2007). Final report issued September 2008. Audit closed. - OIG 50099-52-TE AGI Limitations (August 2006). Audit terminated by OIG and closed July 2009 OIG 50601-04-Hy Adequacy of Internal Controls Over Travel Card Expenditures Follow-up (November 2006). This was a follow-up audit to 50601-05-HQ, June 2003. Final report issued September 2008. Audit closed. OIG 50601-12-KC Hurricane Relief Initiative (NRCS and FSA) (May 2005). Final report issued November 2007. Audit closed. - 176 25-13 FY 2009 General Accounting Office (GAO) and Office of Inspector General (OIG) on-going audits: • GAO 360644 USDA Funding for EQIP – USDA Conservation Programs Stakeholders Views on Participation and Coordination to Benefit Threatened and Endangered Species and Their Habits (November 2007). Final report (GAO-07-35) posted on November 2007. The new EQIP allocation formula has been approved and is being used for FY 2009, GAO concerns have been addressed. • OIG 10099-4-SF Wetlands Reserve Program Restoration Compliance (January 2006). Submitted closure documentation to OCFO approval is pending. - • OIG 10099-6–SF Farm and Ranch Lands Protection Program-Review of Non-Governmental Organizations (May 2007). Submitted revised Agency response on Recommendation 3 to OIG on September 8 2009. • OIG 10099-10-KC Homeland Security, NRCS Protection of Federal Assets (April 2002). Request for closure pending issuance of firearms policy. - • OIG 10401-2-FM FY 2008 NRCS Financial Statement (January 2008). Final report issued November 2008. Corrective actions are being taken for Recommendations 1-9. • OIG 10601-1-At Flood Control Dam Rehabilitation (December 2006). Agency response for Recommendations 9 and 10 were re-submitted to OIG on September 14, 2009. • OIG 10601-04-KC NRCS Conservation Security Program (CSP) (November 2006). Management decision was not reached on Recommendations 6, 8, 9, 16-19, 21 and 23. Agency response will be resubmitted in FY 2010 1" quarter. - - • OIG 50099-11-SF Crop Base Acres on Conservation Easement Lands (May 2005). OCFO accepted final action for Recommendation 1 and no further reporting is necessary for this audit. The remaining recommendations are assigned to FSA. • OIG 50601-10 -HQ Saving the Chesapeake Bay Watershed Requires Better Coordination of Environmental and Agricultural Resources (May 2005). Request for closure is pending receipt of supporting documentation. • OIG 50601-18-Te Pasture, Rangeland, and Forage Pilot Program (March 2008). Risk Management Agency (RMA) has the lead. No findings have been reported to NRCS. No additional information is needed at this time. RMA will provide NRCS the status of closeout, • OIG 50801-1-TE Urban Resources Partnership Program (June 1998). Submitted closure documentation to OCFO approval decision is pending. FY 2009 GAO and OIG started or open audits: • OIG 10601-6-KC Emergency Disaster Assistance for the 2008 Floods-Emergency Watershed Protectio Plan (EWP) (January 2009). In progress. Entrance conference held on February 4, 2009. • OIG 10703-1-KC Emergency Watershed Protection Program Floodplain Easements (April 2009). In progress. Agency response to Fast Report was submitted to OIG on September 8, 2009, • OIG-10703-2-KC Watershed Protection and Flood Prevention Operations Program (April 2009). In progress. Entrance conference held on September 15, 2009. • OIG-10401-3-FM Audit Report: NRCS’ Financial Statements for Fiscal Year 2009. Final Report issued November 2009. • - 177 25-14 NATURAL RESOURCES CONSERVATION SERVICE Ayailable Funds and Staff-Years 2009 Actual and Estimated 2010 and 2011 Actual 2009 Estimated 2010 Estimated 20 i ! {tem Staff Staff Staff - - Amount Years Amount Years Amount Years Conservation Operations........................... $853,400,000 6,402 $887,629,000 6,573 $923,729,000 6,208 Healthy Forests Reserve Program................ - • - º - - Watershed Surveys & Planning..................., - - - - sº- - - Watershed & Flood Prevention Op................ 24,289,000 301 30,000,000 683 - º Recovery Act, Watersheds....................... 290,000,000 .67 * 397 wº- º Subtotal, Watersheds & Flood................. 314,289,000 368 30,000,000 1,080 gº - Watershed Rehabilitation Program................ 40,000,000 64 40,161,000 63 40,497,000 29 Recovery Act, Rehabilitation.................... 50,000,000 8 - 36 tº- - Subtotal, Water Rehabilitation................. 90,000,000 72 40,164,000 99 40,497,000 29 Resource Conservation & Develop............... 50,730,000 42 50,730,000 412 tº - Total, Appropriated Funds....................... 1,308,419,000 7,254 1,008,520,000 8, 164 964,226,000 6,237 Carryover Funds (Available): - Conservation Operations.......................... 16,365,677 * 34,502,394 º - - * Healthy Forests Reserve Program................ 1,274,274 - 1, 195,190 sº 1,195,190 - Wetlands Reserve Program......... ............. - 2,741,796 * 2,817,287 º º * Watershed & Fiood Prevention Op.............. 563,824,463 <- 356,640,362 * tº- - Recovery Act, Watersheds...................... - - º 170, it 7,932 sº - *. Watershed Rehabilitation Program.............. 4,907,025 - 9,946,369 * * - Recovery Act, Rehabilitation................... - * 32, #58,801 * * * Chesapeake Bay Watershed Program........... * * 1,158,381 s * *- Healthy Forests Reserve Program (Mand.)..... * * 7,223,828 ve º - Colorado River Salinity........................... 268,746 * 268,746 sº - - Water Bank Program.............................. 745,181 * 745, 181 * - º Forestry Incentives Program...................... 6,016,890 * 5,628,003 sº - * Great Plains Conservation Prog.................. 547,594 tº 547,594 * - * Resource Conservation & Devel................. 2,345,834 * 2,774,795 * * * Transfer from CCC: . Wildlife Habitat incentives....................... 9,775,538 *- 10,326,388 wº- - - Total, Available Funds.................. ........... 1,917,232,018 7,254 1,644,571,251 8, 164 965,421, 190 6,237 Obligations under other USDA - appropriations; Farm Security & Rural Investment Program .............................. .............. 2, t 17,859,173 3, 176 2,965,484,000 4,932 3,022,491,000 4,003 Reimbursements for technical services to: Emergency Conservation * Program (FSA)..........................., * * * * * * * * 2,315,608 31 3,168,397 28 3,168,397 28 Foreign Details & Assign. (OICD)............., - * * º - º Soil Survey (FS).................................... 70,379 l 66,906 { 66,906 ! Accelerate Soil Survey............................ 328,559 3 301,078 4 301,078 4. Other Planning & Application.................... 55,897,433 538 83,447,804 7.59 124,223,304 I, 123 PMC Operations................................... 90,464 | 79,973 l 79,973 } Reimbursements for other services: Facilities: Rent, phone, utilities, etc............ 9,626,506 l 12,676,677 sº 12,676,677 - Miscellaneous...................................... l,769,024 5 2,272,684 5 2,272,684 5 Total, Other USDA Approp, ....................... 2,187,957,146 3,756 3,067,497,519 5,730 3,165,280,019 5,165 Total, Agriculture Appropriations................. 4,105,189,164 11,010 4,712,068,770 13,894 4,130,701,209 11,402 178 25-1 5 NATURAL RESOURCES CONSERVATION SERVICE Available Funds and Staff-Years 2009 Actual and Estimated 2010 and 2011 (Continued) Actual 2009 Estimated 2010 Estimated 20 ! } item - Staff Staff Staff Amount Years Amount Years Amount Years Other Federal Funds: - Reimbursement for technical services for: * Soil surveys (Interior).............................. 1,942, 137 sº $1,721,596 } 9 $1,721,596 19 Accelerate Soil Survey............................ 4,049,281 43 3.643,253 38 3,643,253 38 Other: planning & application.................... 6,364,026 45 24,818,723 65 4,369,716 22 Snow Survey & Water Forecast.................. - - - - º º Plant Materials Center Operations............... 1,120,155 10 990,261 11 990,261 } } Bureau of Land Management..................... 491,319 6 435,526 435,526 5 Reimbursement for other services: Facilities: Rent, phone, utilities, etc............. 33,830 - 49,369 - 46,288 * Cartographic job work............................. 1, 184 -* 1,620 - 1,620 * Proceeds of sales................................... - - º - *- *- Financial assistance................................ 3,768,382 * 33,098,766 - 3,121,966 * Miscellaneous...................................... 3,174,330 29 4,496,062 29 4,197,450 25 Total, Other Federal Funds......................... 20,944,644 133 69,255, 176 167 18,527,676 120 Non-Federal Funds: Reimbursement for technical services for: Planning & application............................ 1,471,625 16 2,018,712 15 1,998,712 ł5 Accelerate Soil Surveys........................... 1,232,623 l{} 1,138,458 #2 1,138,458 }2 Snow Survey & Water Forecast.................. - - º - * - Plant Materials Center Operations............... 191,276 I 169,096 I I69,096 H Cartographic job work............................. - º º * * -> A&E Contracting.................................., - - * - - * Reimbursement for other non-Federal Services: Facilities: Rent, phone, utilities, etc............ 971,892 3- 1,326,134 ... • 1,326,134. * Proceeds of Sales................................... 6,500 --> 7,185 - 7,185 - Financial assistance................................ 2,093,776 - 350,000 - - = Miscellaneous...................................... H,791,710 } 6 2,609.720 14 2,259,720 14 Trust funds............................................ 207,587 * 450,000 i 450,000 1 Total, Non Federal Funds........................... 7,966,989 43 8,069,305 43 7,349,305 43 Total, NRCS.......................................... 4,134,100,797 11, 186 4,789,393,251 14, 104 4,156,578,190 1 1,565 179 NATURAL RESOURCES CONSERVATION SERVICE Permanent Positions by Grade and Staff-Year Summary 25-16 2009 Actual and Estimated 2010 and 2011 2010 - 2009 2011 GRADE HDQ FIELD TOTAL HBQ : FIFLD TOTAL HDQ FIELD TOTAL Senior Executive Service.. | 8 3 21 | 8 3 2} 18 : 3 2] GS-15 ..................... 82 71 153 77 68 | 45 82 70 #52 GS-14 ..................... i 38 | 72 3 || 0 132 l64 296 136 ł69 305 GS-13 ..................... SS 526 58] 53 503 556 54 517 57] GS-12 .............. ...... 28 3,146 3,174 27 3,006 - 3,033 27 3,089 3,116 GS-11 ..................... 23 2,451 2,474 22 2,342 2,364 23 2,407 2,430 GS-10 ..................... l 32 33 l 3 32 f : 3] 32 GS-9 ..................... 28 1,597 1,625 27 1,526 1,553 7 1,568 1,595 GS-8 ..................... 9 478 A87 9 457 466 9 : 469 . 478 GS-7 ..................... 4 1,480 1,484 4 ł,414 1,418 . 4 1,453 1,457 GS-6 ..................... 14 408 422 | 3 390 403 14 401 4 : 5 GS-5 ..................... 2 409 4 : 1 2 391 393 2 402 404 GS-4 ..................... 3 328 33 3 3 #3 316 3 322 325 GS-3 ..................... 3 234 237 3 224 227 3 230 233 GS-2 ..................... 0 67 67 0 64 64 0 66 66 GS-1 ..................... {} 39 39 {) 37 37 . () 38 38 ther Graded Positions 0 0 () () 0 0 . () , 0 0 º Positions {} 0 0 . 0 {} {} () 0. 0 Total Permanent - - Positions 408 i 1,441 11,849 391 10,933 1 1,324 403 l 1,235 1 1,638 nfilled Positions, • - end-of-year 18 1,052 1,070 () 0 0. 0. {} () Total, Permanent Employment, end- of-year 390 10,389 10,779 391 10,933 1,324 403 11,235 | 1,638 Satyear Estimate 385 10,80 | | 1, 186 486 || 3,618 4, 104 398 l i, 167 . I 1,565 180 25-17 NATURAL RESOURCES CONSERVATION SERVICE Size, Composition and Cost of Motor Vehicle Fleet Travel by most field NRCS employees requires a high degree of mobility with frequent stops at field offices, job sites (farms and ranches) and other areas where common carrier transportation is non-existent, uneconomical or inadequate. Employees require pickup trucks and sport utility vehicles (SUV) to drive on agricultural land to provide technical assistance to farmers and ranchers, and to transport large engineering and other field equipment. NRCS vehicles are distributed among field, area and State offices in the 50 States, Caribbean and Pacific Basin. NRCS has no vehicles in Washington, D.C. Passenger vehicles are assigned to an office location. Several employees use a single vehicle, maximizing its use and minimizing the number of vehicles at a location. NRCS requires annual vehicle inspections and certification to ensure that vehicles are safe and reliable. NRCS policy for the replacement of motor vehicles is based on economy and safety, Industry standards and experience indicate that it is economical and safe to operate vehicles beyond the minimum standards set forth in FMR 102-34,280; GSA leased vehicles are replaced based on the FMR. NRCS maximizes purchases of Alternative Fuel Vehicles. Changes to the motor vehicle fleet. At the end of FY 2009, NRCS had 1,148 passenger vehicles in a fleet of 10,130 sedans, station wagons, vans, SUVs and trucks. The fleet size is 1,339 vehicles more than reported in FY 2008. NRCS has a GSA-leased fleet of 192 vehicles that includes 59 passenger vehicles. NRCS anticipates a decrease of 151 vehicles in the total fleet in FY 2010. Replacement of Agency-Owned Motor Vehicles. In FY 2010, NRCS will dispose of 107 passenger vehicles that meet replacement criteria and acquire (buy/lease) 60. Impediments to managing the motor vehicle fleet. Alternative fuel is not available at many rural, remote NRCS field locations. NRCS continues to purchase alternative fuel vehicles and to use alternative fuel as it becomes available at field locations. High fuel costs continue to impact managing the motor vehicle fleet in the most cost effective manner. Size, Composition, and Annual Cost (in thousands of dollars) Number of Vehicles by Type' Light Trucks, SUV, º - Fisca; Year sº g Vans º #. *: Buses vº. cº, Wagons 4X2 4X4 - Costs 2008 . 1,068 4,509 2,992 210 12 {} 0 8,791 $15,876 Change -298 -323 +1,564 +5 - 1 0 0 –2,201 +$676 2009 1,148 4,032 4,591 3.19 40 0 0 10, 130 $11,313 Change +80 -477 ±1,599 +109 +28 0 0 +1,339 -$4,563 2010 1, 101 3,996 4,539 304 39 0. 0 9,979 $11,144 Change –47 -36 -52 - 15 -1 0 0. - 151 -$169 201 | 1,107 3,941 4,697 316 39 0 0 10,100 $11,279 Change +6 -55 +158 +12 O 0 0 +121 +$135 'Numbers include agency-owned and GSA-leased vehicles. NRCS does not have any commercial leased vehicles. * Fiscal Year 2009 vehicle inventories include vehicles obtained through GSA under the American Recovery and Reinvestment Act (ARRA). In FY09, NRCS received 537 vehicles on or before September 30, 2009. 181 25-18 NATURAL RESOURCES CONSERVATION SERVICE Conservation Operations he estimates include appropriation language for this item as follows (new language underscored; deleted atter enclosed in brackets): onservation Operations For necessary expenses for carrying out the provisions of the Act of April 27, 1935 (16 U.S.C. 590a-f), including preparation of conservation plans and establishment of measures to conserve soil and water (including farm irrigation and land drainage and such special measures for soil and water management as may be necessary to prevent floods and the siltation of reservoirs and to control agricultural related pollutants); operation of conservation plant materials centers; classification and mapping of soil; dissemination of information; acquisition of lands, water, and interests therein for use in the plant materials program by donation, exchange, or purchase at a nominal cost not to exceed $100 pursuant to the Act of August 3, 1956 (7 U.S.C. 428a); purchase and erection or alteration or improvement of permanent and temporary buildings; and operation and maintenance of aircraft, [$887,629,000] $923,729,000, to remain available until September 30, [2011, of which $37,382,000 shall be for the purposes, and in the amounts, specified in the table titled "Congressionally Designated Projects" in the statement of managers to accompany this Act: 2012: Provided, That appropriations hereunder shall be available pursuant to 7 U.S.C. 2250 for construction and improvement of buildings and public improvements at plant materials centers, except that the cost of alterations and improvements to other buildings and other public improvements shall not exceed $250,000: [Provided further, That the Secretary is authorized to transfer ownership of all land, buildings, and related improvements of the Natural Resources Conservation Service facilities located in Medicine Bow, Wyoming, to the Medicine Bow Conservation District: Provided further, That when buildings or other structures are erected on non- Federal land, that the right to use such land is obtained as provided in 7 U.S.C. 2250a. (7 U.S.C. 2201-02; 16 U.S.C. 1101-5; 33 U.S.C. 7016-11; Agriculture, Rural Development, Food and Drug Administration, and Related Agencies Appropriations Act, 2010.) he first change in language proposes deletion of "2011, of which $37,382,000 shall be for the purposes, and the amounts, specified in the table titled "Congressionally Designated Projects" in the statement of anagers to accompany this Act" and insertion of 2012. he second change in language proposes deletion of "Provided further, That the Secretary is authorized to ansfer ownership of all land, buildings, and related improvements of the Natural Resources Conservation rvice facilities located in Medicine Bow, Wyoming, to the Medicine Bow Conservation District.". 182 25-19 NATURAL RESOURCES CONSERVATION SERVICE Conservation Operations Appropriation Act, 2010.......................................................... * * * * * ... $887,629,000 Budget Estimate, 2011 .......................... * - 4 A … 923,729,000 Increase in Appropriation ......................…................................................................... 3:36,100,000 Summary of Increases and Decreases (On basis of appropriation) Item of Change 2010 20 ! I Conservation Operations: Estimated Pay Costs Other Changes Estimated !, Conservation Technical Assistance.......... $761,707,000 +$7,119,000 +$27,618,000 $796,444,00 2. Grazing Lands Conservation Initiative...... 9,930,000 +148,000 * - 10,078,00 3. Soil Survey....................................... 93,939,000 + 1,01 1,000 as wº 94,950,00 4. Snow Survey & Water Supply Forecasting. 10,965,000 +95,000 tº tº { 1,060,00 5. Plant Materials Centers........................ 11,088,000 +109,000 vs an ! {, 197,00 Total Available....................................... 887,629,000 8,482,000(1) 27,618,000(2) 923,729,00 183 25-20 NATURAL RESOURCES CONSERVATION SERVICE Conservation Operations Project Statement (On basis of appropriation) 2009 Actual 2010 Estimated increase 2011 Estimated Staff: Staff. Qf - Staff - Amount: Years: Amount: Years; Decrease Amount Years Conservation Operations: '. - - . . . . . - • - . . l Technical Assistance........ $729,667,000: 5,449; $761,707,000: 5,624: +$34,737,000: $796,444,000: 5,304 2. Grazing Lands.................. 9,930,000; 80: 9,930,000: 78: +148,000: 10,078,000: 76 3. Soil Surveys ..................... 92,229,000: 696; 93,939,000; 707: +1,011,000; 94,950,000: 672 4, Snow Surveys................... 10,806,000: 76: 10,965,000: 63: +95,000: | 1,060,000: 6} 5. Plant Materials................. 10,928,000: 10} : 11,088,000: 101: i-109,000: i 1,197,000: 95 Totai, Available..................... 853,560,000; 6,402: 887,629,000; 6,573; 36,100,000; 923,729,000; 6,208 Transfer from Congressional --- : : - - Relations -160,000: **. Total, Appropriation............. — 853,400,000; 6,402; Project Statement (On basis of available funds) - - 2009 Actua; 2010 Estimated Increase 2011 Estimated Staff: - Staff. Or Staff Amount: Years: Amount: Years: Decrease Amount Years Conservation Operations: : : : : . : 1. Technical Assistance......... … $728,272,705: 5,449: $790,940,738; 5,624: +5,503,262: $796,444,000: 5,304 2. Grazing Lands.............•e v g » tº w tº * * * * 9,930,000. 80: 9,930,000; 78: +148,000: 10,078,000: 76 3. Soil Surveys........., ... --------. . . . . . 91,058,703: 696; 98,290,310: 707 -3,340,340: 94,950,000: 672 4. Snow Surveys........................ 12,871,625: 76: 11,228, 163: 63: -168, ió3: | 1,060,000: 6] 5, Plant Materials....................... 12,531,568. }{}i : 1 1,742, 183: | 0} –545, #83: 11,197,000: 95 Total, Direct Obligations........... 854,664,601: 6,402: 922,131,394: 6,573: +1,597,606: 923,729,000. 6,208 Unobligated Bal. Brought Fwd. (-44,169,102) -*. (-52,922,718) --: , (+34,502,394) (-18,420,324) ** Prior Year Recoveries ............... (-21,423,020) --. --. --. -- . ~- ** Unobligated Expiring Balance,. (+4,562,415) * * --~ * --" •- . --> * ** Offsetting Collections................ {-38,493,475) * tº ** ses -- *** wº, sº Reimbursements........................ (+35,545,636) -- --. **g * =. ** *ºtº Change in Customer Payments. (+9,950,227) -- --. tº gº * * ~, twº sº Not Available Carried Fwd....... --. -kº, (+18,420,324) ~~. •- . (+18,420,324) -- Unobiigated. Bal. Carried Fwd. {+52,922,718) *ge --. is aw ~~ : --. ** djusted Appropriation............. (853,560,000) * * (887,629,000) ---. (+36,100,000) (923,729,000) * tº Reimbursable Obligations: - - Conservation Tech. Assist......... 25,579,578: 112: 26,714,000: 87: ** 35,000,000: 106 Soil Surveys 7,896,720. 62: 7,000,000: 78: *** 7,000,000: 78 Snow Survey & Water............. : : . .. : Supply Forecasting................ 485,698: 2: 600,000: 2: 4-m 600,000: 2 Piant Materials Centers........... 1,583,640: 14: 1,400,000: 15: gº tº 1,400,000: 15 EPA Great Lakes Restorations Initiative................................. --. **. 8,286,000: 19: tº sº --. **: otal Reimbursable Oblige ....... 35,545,636: #90: 44,000,000; 201: -- . 44,000,000: 201 bligational Authority ............., 890,210,237; 6,592: 966,131,394: 6,774: +1,597,606: 967,729,000; 6, 184 la.) 2a) 25-21 Justification of Increases and Decreases A net increase of $36,100,000 for Conservation Operations ($887,629,000 available in 2010): ,-- An increase of $8,482,000 to fund increased pay costs. - The increase for pay will enable NRCS to maintain current staffing levels which are critical to the Agency’s objective of providing adequate levels of conservation technical assistance to farmers and protecting the natural resource base on private lands, The increased pay cost funds are needed to avoid any disruption or delays in the Conservation Operations program activities and will be used to pay the increased salaries and benefits costs for the 6,208 FTE’s funded in the FY 2011 budget request, An increase of $5,000,000 for NRCS Streamlining and Integrating Business Model and Information Technology Tools to improve NRCS financial system accountability and transparency and conservation planning delivery. The successful delivery of conservation technical assistance is inherently a field-based activity. Since 2002, increased administrative workload associated with increased financial assistance programs have significantly reduced the amount of time field staff can spend in the field during the planning process. At the same time the financial assistance funding has increased, the number of NRCS FTE’s has declined. To streamline the business processes required to support conservation planning and contract development, NRCS is designing the next generation Toolkit around the concept of a mobile planning tool that is a critical part of our delivery model in the future. NRCS envisions having field staff in the field, working with clients 65 to 80 percent of the time. Web-based applications will integrate GIS services and mobile computing so that planning and contract development will occur simultaneously as the planner is working in the field. - The streamlining effort and next generation tools will: 1) make participation in USDA’s conservation programs easier for customers and the delivery of programs less complex for employees; 2) increase efficiencies by streamlining and integrating processes across business lines, and 3) ensure the continued science-based delivery of technically sound conservation products and services. The funding will be used to 1) redesign NRCS’ business processes into a more efficient and integrated model for delivering three business lines: conservation planning, conservation practice implementation, and financial assistance. Five hundred thousand dollars will be used for business process modeling teams to the develop the tools; 2) rebuild NRCS’ business and science information technology applications around a service oriented architecture and shared enterprise databases to streamline IT development, eliminate duplicate data entry by the field staff, and provide a common portal for field staff to access the diverse set of IT tools needed in conservation assistance. Three million dollars will be used for IT development to include an initial set of redesigned customer self service tools that will allow clients to work with NRCS in new ways, such as applying for services on-line, certifying practice installation, and digital signature capability. This development would also include laying the foundation for automatically estimating environmental effects from conservation programs, facilitating an efficient role for NRCS in environmental market approaches; 3) build a mobile planning application around portable computing technologies that will enable the Agency’s goal of having technical field staff spend 75 percent of their time in the field with clients. One million dollars will be needed to construct the basic mobile planning tool so all field staff can operate in a “disconnected mode”, where they will have access to all the needed data and integrated GIS tools when in the field with clients; and 4) conduct pilots to evaluate alternative strategies for delivering financial assistance more effectively and efficiently. Five hundred thousand dollars will be used for training for rolling out newly designed technical tools. 185 25-22 b.) An increase of $25,000,000 for the implementation of Strategic Watershed Action Teams (SWATs) that will be deployed to high priority degraded agricultural watersheds. - Conservation plans developed through Conservation Technical Assistance (CTA) provide the mechanism through which landowners and managers identify conservation systems to address their natural resource needs, and make decisions about the appropriate financial assistance programs. This initiative identifies an innovative approach to address this issue. - NRCS envisions deploying a SWAT consisting of five to seven people, with expertise in planning, for a period of between three to five years in a specified geographic location discussed below. These teams will include Soil Conservationists, technicians and specialists and will be identified based on the needed technical expertise in each watershed. Specialists may include range specialists, engineers or biologists. The number of teams deployed for each watershed will depend on the analysis of natural resource and Socioeconomic data of the region and will be decided based on a formula that NRCS will develop. The teams will work under the direction of the local District Conservationist in cooperation with the State and local Conservation Districts to provide a seamless cadre of field professionals. The development and deployment of SWATs will greatly improve the environmental cost effectiveness of NRCS technical and financial assistance programs. The funds will enhance the Agency's capability to Strategically invest in conservation and better target the Agency’s financial and technical assistance programs. Because the SWATs will provide significant planning, education, and program - implementation assistance, the technical assistance teams will help ensure that NRCS programs are Strategically targeted and effectively integrated on a farm and ranch as well as a watershed scales. The goal of deploying the SWAT's will be to reach every landowner in a targeted watershed eligible for NRCS programs and provide them with the technical assistance to assess their natural resource conditions and offer resource planning and program help. Emphasis in resource assessment and planning will be placed on those resource conditions that are of priority interest in the selected watershed. For instance, if a watershed has been designated a high priority for its threat to nitrogen loading, every effort will be made to emphasize high impact targeted practices for nitrogen avoidance, control and entrapment. The total number of FTE's for this initiative that could be supported by the increase in CTA funds could be as much as 175 (or approximately 35 teams). The costs would be for salary, training, equipment and relocation in years of redeployment, . Having a concentrated number of field employees in a strategic watershed will increase the number and extent of conservation practices installed through financial assistance programs or by private landowner investment in a shorter period of time. The ability to make one-on-one contact and to follow-up will have a profound effect on conservation practices being adopted. Increased conservation practice adoption and implementation will result in faster environmental response and natural resource improvement. To determine the future of this new approach, NRCS will evaluate the cost effectiveness of the SWATs. The evaluation will assess both the change in administrative performance (such as the technical assistance cost to deliver a program, percent of farming operations participating in a watershed, and the time to plan, design, and install practices), as well as environmental performance (such as the change in: wildlife populations, water quality and quantity, and farm profitability) versus watersheds with no SWATs. The SWATs will help NRCS work more closely and effectively with the U.S. Forest Service (FS) in that agency’s efforts to also adopt a landscape-scale approach to natural resource management. This will leverage the strengths of each agency’s technical skills and natural resource programs to conserve and 186 2c.) 2d.) 25-23 restore forestland, grassland, and working farmland. This coordinated, strategic approach will encompass public and private lands. Additional partnerships with other local, State, and Federal agencies, as well as private and non-profit partners, will expand the reach and success of the initiative. During Fiscal Years 2010 and 2011, NRCS will coordinate with FS and other stakeholders and partners to identify high-priority watersheds, which may include the Bay-Delta region in California and the Upper Mississippi, in order to enhance conservation on a landscape scale across land ownerships. Smaller critical watersheds within these high-priority watersheds would be identified for the deployment of SWAT, using natural resource and Socioeconomic data including: • Conservation Effects Assessment Project (CEAP) data. • State-level natural resource data, • State-level strategic conservation and land management priorities. • Other information and priorities identified trough the NRCS State Technical Committees in cooperation with other Federal, State, and private partners. An increase in Conservation Technical Assistance of $35,000,000 for Common Computing Environment (CCE) refresh. The budget includes $35 million for NRCS to support the Department’s efforts to modernize and upgrade the CCE for the Service Center Agencies (SCAs). This funding will be used to replace outdated components of the CCE, many of which have exceeded their expected life cycles, reduce system vulnerabilities to failure and improve the performance and effectiveness of the shared infrastructure. These improvements will allow the SCAs to better serve program participants with a more flexible and reliable IT infrastructure and enable the first system-wide refresh of the CCE since the infrastructure was implemented in 2000. In addition, as the components of the CCE are replaced, USDA will implement a right-sizing process whereby configuration changes will be made to better support the delivery of current and future programs. As part of this process, the Department will strive to improve system security, reduce the long term cost of infrastructure services, and improve service reliability, A decrease of $37,382,000 in Conservation Technical Assistance program earmarks. In FY 2010, Congress included over $37 million of earmarks in the Conservation Operations programs. This decrease in funding will eliminate Congressional earmarks in the Conservation Technical Assistance account. The savings from elimination of earmarks will be redirected to high priority program areas described above (2a-2c). 187 \labama...... Alaska........ ieorgia....... [awaii........ ſississippi... fissouri...... fontana...... 25-24 Natural Resources Conservation Service Conservation Operations Geographic Breakdown of Obligations and Staff Years * & 4 & a tº 4 & g º gº º e º e º e º ºs º a * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * > * * * * * * * * * * * * A A' A & & 4 & 9 º' g º & © tº G w w w a dº • * * * * * * * * * * * * * * * * * * * * • * * * * 4 e s s & a e v u v s s a • * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *s a ga º e s tº a tº a ſº e a * * * * * * * * * * * * * w a tº * * * * s • * * * * * * * * * * * * * * * * * * > g. M. º. º a tº wº º is t t e º & ºr a tº 4 tº $ tº º * * * * * * * * * * * * * * * * * * * s is tº s e º º 4 tº a 4 ſº º t e º 'º - - - - « 4 w ºr ºf a º e º 'º s º e º sº º sº º º a w is tº • * * * * * * * a s m e º ºr w = e - e º g * * * * * * * * * * * * * * * * * * * * * m e º a sº a s a s = e s is a a A a e º ºr a İebraska..... * * * * * * * * * * * * * * : * * * * * * * * * * * * * * * * * * * * * * * * * * * a n e º e º a 2 m e s ∈ a n e s = e tº a s evada............................. ew Hampshire.................. ew Jersey........................ evy Mexico. - - - - - - - - us s a se - - - - - - - - - * * * * * * * * * * * * * * * * * * * * * * r * * r * * * * * * * * * * * v- w w x * * tº w a 4 º' tº tº it w is º f * * * * * * * * * * * * * * * * * * * s e = * * * * * * * * tº e º 'º V - * * * * * * : * * * * * * * * * 2009 Actual and Estimated 2010 and 2011 2009 2010 20 i ! Staff Staff Staff Amount Years Amount Years Amount Years $12,025,893 I 1 $11,912,797 111 $11,158,000 102 5,605,918 27 5,054,468 27 4,734,000 25 7,726,352 70 8,583,469 79 8,040,000 72 | 1,228,921 1 H2 12,395,801 121 1 1,611,000 | 10 21,219,138 174 22,776,214 184 21,334,000 168 17,091,033 151 17,107,696 151 16,024,000 139 3,440,770 27 4,695,376 34 4,398,000 30 1,957,725 19 2,689,970 2} 2,520,000 18 9,799,464 90 10,349,815 92 9,694,000 84 15,723,983 142 16,233,877 146 15,206,000 134 7,813,059 66 9,540,213 70 8,936,000 62 10,825,479 i ()5 11,256,791 108 10,544,000 99 17,648,096 178 17,652,927 178 16,535,000 163 13,202,961 ł28 13,049,679 128 12,223,000 | 17 24,429,751 225 23,732,163 225 22,229,000 207 20,753,792 202 23, 143,370 209 21,678,000 190 14,384,367 123 14,804,146 126 13,867,000 1 16 10,612,070 103 1 1,205,724 107 10,496,000 97 4,861,490 44 5,174,208 45 4,847,000 4 5,941,174 { 15 6,952,253 121 6,512,000 | 10 3,375,891 26 4,439,432 32 4,158,000 28 12,346,120 # 15 12,888,882 1 18 12,073,000 {08 16, 135,569 | 85 16,848,604 19 | 15,782,000 174 15,290,214 156 16,440,356 I62 15,399,000 148 20,271,921 2 : { . 21,525, 143 216 20,162,000 197 18, 143,416 tg4 19,257,489 200 t 8,038,000 183 17,268,439 | 76 18,465,816 182 17,296,000 166 4,968,806 43 5,472,886 44 5, 126,000 40 2,673,510 21 3,547,080 23 3,322,000 20 4, 179,647 40 4,970,806 42 4,656,000 38 9,702,700 86 10,266,782 89 9,617,000 81 12,485,628 {{}{} 12,949,004 106 12,129,000 97 12,179,031 } 02 11,814,754 102 11,066,000 94 15,391,982 }34 18,249,106 141 17,093,000 127 12,670,699 113 12,996,503 116 12,173,000 106 16,130,890 185 16,025, 143 185 15,010,000 | 70 12,620,525 | 17 13,190,771 121 12,355,000 | || 0 I 1,335,665 i 14 11,923,524 118 11,168,000 107 188 Puerto Rico.. Rhode Island * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * is m ºr a s a s - - * * * South Carolina................... South Dakota..................... Tennessee.............. . . . . . . . . . . . Vermont..... Virginia...... s = 9 tº tº w w w ºr * * * * * * * * * * * * • * * * * * * * * * * * g e e s - 4 a tº a w s e < * * * * * * * * * * * * * * * * ºr w s * * * * * * * * * * * * d w w w w w w tº gº Washington....................... West Virginia..................... Wisconsin... Wyoming.... • s tº g º ºr w w w a sº tº $ tº w w p → • 6 tº º 4 a • * * * * * * * * * * * * * * * * * * * National Haqtr.................... National Centers.................. Nat. Tech. Sup. Cent............. Undistributed.................. e º º Total Obligations/Est............ - 25–25 2009 2010 2011 Staff Staff Staff Amount Years Amount Years. Amount Years 3,698,769 34 4,090,553 35 3,831,000 32 1,527,199 1 2,712,727 12 2,541,000 10 7,741,047 81 8,235,968 83 7,714,000 76 13,558,446 140 13,653,554 144 12,789,000 132 12,701,835 115 13,874,112 119 12,995,000 108 45,853,665 450 47,341,977 471 44,344,000 431 10,220,675 82 10,864,524 85 10,176,000 77 3,967,240 35 4,383,509 36 4,106,000 33 9,819,784 95 | 1,409,626 99 10,687,000 90 11,825,113 108 12,423,537 112 1 1,637,000 102 8,308,697 82 8,770,556 84 8,215,000 77 17,017,396 156 17,885,141 161 16,752,000 147 8,572,642 80 9,587,594 83 8,980,000 75 183,732,262 281 228,241,876 328 213,786,000 336 50,040,218 249 35,627,620 177 33,371,000 162 12,617,524 73 11,670,000 73 10,931,000 67 * - -- 1,775,482 -- 61,665,000 175 854,664,601 6,402 922, 131,394 6,573 923,729,000 6,208 189 Washington, D.C. Field * & 25–26 NATURAL RESOURCE CONSERVATION SERVICE Conservation Operations Classification by Objects 2009 Actual and Estimated 2010 and 2011 *rsonnel Compensation: 1 | 24 25.1 Total personnel compensation ........ 12 Personnel benefits........ * * * * * * * * * * * * * * * * * * * 13 Benefits for former personnel ......... Total Pers. Comp. & Benefits......... Other Objects: 21 Travel. w * 22 Transportation of things.................. 23.1 Rent payments to GSA........~~~~ 23.2 Rental payments to others............... 23.3 Communications, utilities, and misc. charges................................... Printing and reproduction................ Advisory and assistance services.... 25.2 Other services................................. 25.2 Construction contracts .................... 26 Supplies and materials.................... 31 Equipment.... 32 Land and structures......................... 41 Grants - gº ºn 42 Insurance and loans......................... 43 Interest and dividends..................... 44 Refunds Total other objects........................... Total, direct obligations Position Data: Average Salary, ES positions Average Salary, GS positions Average Grade, GS positions 2009 $30,292,732 402,623,650 432,916,382 127,797,482 — 226,377 560,940,241 18,498,759 4,336,954 24,048,564 8,945,523 685,998 204,878,539 240,702 13,081,207 17,145,042 1,167,297 398,170 300,321 -2.716 293.724,360 –854,664.601 $160,199 $64,539 8 201 * $31,628,590 420.208.410 451,837,000 133,427,000 235,000 585,499,000 19,048,000 4,480,000 24,917,000 9,214,000 708,000 245,343,394 13,425,000 17,597,000 1,182,000 412,000 306,000 * =º 336,632,394 22.1 $163,403 $65,830 8 2011 *= $30,336,110 403,036,890 433,373,000 127,963,000 226,000 561,562,000 18,276,000 4,296,000 23,880,000 8,848,000 678,000 239,604,000 12,881,000 51,880,000 1,135,000 395,000 294,000 362,167.000 923,729,000 $166,834 $67,212 8 190 25-27 NATURAL RESOURCES CONSERVATION SERVICE JUSTIFICATION OF INCREASES AND DECREASES - Conservation Operations USER FEES-PROPOSED LEGISLATION Explanation of Proposed Legislation: This proposal would recover approximately $19 million in FY 2011. The Natural Resources Conservation Services (NRCS) provides technical and financial assistance for the development of conservation plans and establishment of measures to conserve soil and water, including farm irrigation, flood prevention, and agricultural pollution control. The technical assistance provided to agricultu landowners and operators varies depending upon the complexity of the soil or water conservation resource concern. This proposal would initiate user fees for this service. Because these plans benefit landowners by providing them with individualized site-specific inventories and evaluations of soil, water, and other resource on their land, as well as design, layout and evaluation of over 167 potential conservation practices, USDA is proposing a fee based on the level of service provided. This proposal recommends amending Section 590c of the Soil Conservation and Domestic Allotment Act of 1935 to authorize the charging of fees for particular technical assistance services. This proposal would authorize NRCS to prescribe and collect fees to cover some of the costs of providing technical assistance for completing a conservation plan for a producer or landowner. The proposal would also authorize the fees collected to be deposited in a special fund in the Treasury, and would be available to the Secretary of Agriculture, without further appropriation, for conservation operations purposes. Estimated receipts in FY 2011 are $19 million. The collections that will be raised by initiating these new user fees will be used to reduce appropriations need for FY 2012. - 191 25g-1 NATURAL RESOURCES CONSERVATION SERVICE CONSERVATION OPERATIONS ACCOUNT STATUS OF PROGRAMS onservation Operations is authorized by the Soil Conservation and Domestic Allotment Act of 1935, .L. 74–46 (16 U.S.C. 590a-590f) and the Soil and Water Resources Conservation Act of 1977, (16 U.S.C. 001-2009). The purpose of Conservation Operations is to provide technical assistance supported by cience-based technology and tools that help people conserve, maintain, and improve the Nation’s natural *SOLITCCS, - 'he Conservation Technical Assistance Program is the major delivery program within the Conservation }perations account. In addition, the account includes three other programs: Soil Survey, Snow Survey and ater Supply Forecasting, and Plant Materials Center. Funding in this account provides for the evelopment and delivery of a major portion of the products and services associated with four of the gency’s five business lines: 1) Conservation Planning and Technical Consultation, 2) Conservation mplementation, 3) Natural Resource Inventory and Assessment, and 4) Natural Resource Technology ransfer. The fifth business line (Financial Assistance) is funded primarily through other programs. gency Strategic Plan. The strategic plan emphasizes overarching strategies for meeting natural resource oals and objectives. These strategies are cooperative conservation, watershed-based assistance, and the larket-based approach. Conservation Operations provides the foundation for each of these strategies. In Y 2006, NRCS completed a new strategic plan that established long-term goals and objectives to be chieved by 2010. In cooperation with customers and partners, the strategies described in the plan will ide NRCS toward effective accomplishment of the goals. The strategic planning process assessed long- rm trends and developed guidance for the Agency that will contribute to sustaining natural resources in e coming decades. In 2008, NRCS conducted a review of the plan to evaluate progress and establish jectives through 2015. The updated plan will be issued in early 2010. e Agency’s strategic plan includes six Mission Goals developed with input and advice from partners and keholders. The Mission Goals articulate in broad terms the benefits the Nation expects to derive from RCS activities and programs. They are: 1. High Quality, Productive Soils 4. Clean Air 2. Clean and Abundant Water 5. An Adequate Energy Supply 3. Healthy Plant and Animal Communities 6. Working Farm and Ranch Lands e first three goals address the land uses and resource concerns that have been the primary focus of the gency throughout its existence and continue to be the foundation of a healthy landscape. For each of ese goals, a specific, measurable objective was established for 2010. Performance measures that can be ed to monitor progress toward the long-term objectives are identified for each program, including the mponents of Conservation Operations. Annual targets are set for each performance measure and used in e establishment of budget requests. -- e last three goals address resource issues that are growing in importance as a result of current economic d demographic trends. In updating the strategic plan, the Agency has re-evaluated its role in addressing ese issues. A long-term objective is being established for Clean Air. Working Farm and Ranch Lands ill be addressed through an expanded discussion of the Agency’s mission and vision. NRCS is adopting o Strategic Initiatives-Climate Change Adaptation and Mitigation, and Energy Conservation and stainable Production-to address national priorities that have conservation dimensions and are of vital ortance to the agriculture and forest sectors. Strategic Initiatives are core considerations in nservation planning and implementation, driving continuing advances in the products and services of all business lines. 192 25g-2 CONSERVATION TECHNICAL ASSISTANCE Current Activities Purpose. The broad purpose of the Conservation Technical Assistance (CTA) Program is to provide technical assistance to private landowners, conservation districts, Tribes, local units of government, and other organizations by providing technical assistance through a national network of locally respected, technically skilled, professional conservationists. These conservationists deliver consistent, science-based site-specific solutions to help private landowners conserve, maintain, and improve the Nation's natural resource base. The CTA Program provides the essential building blocks necessary for NRCS to assist farmers, ranchers, other landowners, local groups, Tribes, and local units of government to plan and implement natural resource conservation systems. Agriculture and the quality of America's soil and water resources are vital to the Nation's welfare, Approximately 1.5 billion acres (79 percent of the total acres within the contiguous United States) are non Federal land. Approximately 90 percent of these acres are cropland, rangeland, pastureland, and private non-industrial forestland. The care and health of these lands are in the hands of private individuals. NRC and its partners cooperate in collective efforts with individuals, groups, and other agencies to put conservation on the ground, help conserve the land, increase agricultural productivity, improve the environment, and strengthen the quality of life. - National CTA Program Priorities. The following were FY 2009 National CTA Program priorities: • Reduction in soil erosion and sedimentation on agricultural land; • Comprehensive Nutrient Management Plans (CNMP) to assist the owners and operators of animal feeding operations in addressing their conservation needs, with an emphasis on helping those owners and operators who need to comply with the Environmental Protection Agency's (EPA) Concentrated Animal Feeding Operation (CAFO) rule; - • Reduction of non-point source pollution from nutrients, sediment, pesticides, or excess salinity in impaired watersheds consistent with Total Maximum Daily Loads (TMDL), as well as the reduction groundwater contamination and point source contamination from confined animal feeding operations • Conservation of ground and surface water resources; - • Reduction of emissions of particulate matter, nitrogen oxides (NO.), volatile organic compounds, an ozone precursors and depleters that impair air quality in violation of National Ambient Air Quality Standards; • Promotion of at-risk species habitat conservation and the enhancement of fish and wildlife habitat; • Improve the long term sustainability of all lands, including cropland, forestland, grazing lands, coas lands, and developed and/or developing lands. - Demand for CTA Program-delivered Products and Services. The demand for the CTA Program has increased substantially over the years as a result of: • New technologies and conservation practices that address emerging challenges, such as nutrient management of animal feeding operations to improve water quality; • Design of natural resource conservation systems to reduce the risk of climatic events such as drought, fire and flood, and to mitigate their effects; • Increased awareness and concern for natural resources resulting in a broader customer base as NRCS addresses growing niche enterprises (aquaculture, specialty crops, sustainable and organic farming, etc); • New customers such as Tribal governments, local communities, technical service providers, and non- government organizations who request NRCS expertise and assistance; • Improvement and establishment of wetlands and wildlife habitat to address declining populations of fish and wildlife; and • Increased requests for financial assistance programs and the need for pre-program conservation planning support for the Emergency Watershed Protection Program and the Commodity Credit Corporation-funded Farm Bill programs such as: Environmental Quality Incentives Program, 193 25g-3 Agricultural Water Enhancement Program, Conservation Stewardship Program, Wildlife Habitat Incentive Program, Agricultural Management Assistance Program, and the Conservation Reserve Program. 'o meet this demand and address program priorities, the CTA Program supports the development and elivery of products and services to address NRCS customers associated with the following four major gency business lines: - - Conservation Planning and Technical Consultations: NRCS provides data, information, and technical expertise that help customers collect and analyze information to identify natural resource programs and opportunities, clarify their objectives, and formulate and evaluate alternatives. Conservation Implementation: NRCS helps customers install natural resource conservation practices and systems that meet established technical standards and specifications. Natural Resources Inventory and Assessment: NRCS assesses, acquires, develops, interprets, and delivers natural resource data and information to enable knowledge-based planning and decision making at all landscape scales. Natural Resource Technology Transfer: NRCS develops, documents, and distributes a wide array of technology pertaining to resource assessment, conservation planning and conservation system - implementation and evaluation. - onservation on the Ground. In FY 2009, the CTA Program was the major source of technical assistance customers for planning and applying conservation practices and systems to protect and enhance natural sources on non-Federal land. These conservation actions provide public benefits in the form of better soil lity, reduced delivery of sediment and nutrients to surface and ground waters, increased conservation of ater supplies, healthier grazing and forest land ecosystems, diverse and healthier wildlife habitat, and roved wetlands condition and function. In FY 2009, the CTA Program helped meet the three NRCS oundation Goals in the following ways: - - igh Quality, Productive Soils. Helping people ensure the quality of intensively worked soils is intained or enhanced to enable sustained production of a safe, healthy and abundant food supply. Conservation plans for cropland written, acres; 10.2 million Cropland with conservation applied to improve soil quality, acres: 7.6 million Soil Survey Geographic Data Base (SSURGO) made available: 31 digital soil surveys covering 24.4 million acres Total SSURGO certified digital soil surveys made available to-date, number: 3,047 lean and Abundant Water. Helping people ensure that the quality of surface waters and groundwater is mproved and maintained to protect human health, support a healthy environment, encourage a productive ndscape; and that water is conserved and protected to ensure an abundant and reliable supply for the ation. CNMP written, number: 1,479 CNMP applied, number: 1,485 | Watershed or area-wide conservation plans developed, number: 114 Land with conservation applied to improve irrigation efficiency, acres: 753,214 cally Plant and Animal Communities. Helping people ensure that grassland, rangeland, and forest !osystems are productive, diverse, and resilient; that working lands and waters provide habitat for diverse ld healthy wildlife, aquatic species, and plant communities; that wetlands provide quality habitat for igratory birds and other wildlife, protect water quality, and reduce flood damages. Conservation plans for grazing land written, acres: 22.9 million Grazing lands with conservation applied to protect the resource base, acres: 15.4 million Non-Federal land with conservation applied to improve fish and wildlife habitat quality, acres: 9.1 million Wetlands created, restored, or enhanced, acres: 67,233 194 25g-4 Grazing Lands Conservation. Private grazing lands include 405 million acres of rangeland and 117 million acres of pastureland, as well as 53 million acres of forested land. Some cropland acres are also used for grazing. Well managed grazing contributes substantially to the environmental well-being and to the agricultural economy of the United States. Healthy grazing lands benefit landowners, local communit residents, and society. Healthy grazing lands yield clean water for urban and rural use, aid in flood protection, and reduce greenhouse gases through the exchange of carbon. Properly managed grazing land: reduce the impact of drought and provide aesthetic values, open space, and wildlife habitat. - Technical Assistance on Grazing Lands. In FY 2009, technical assistance provided to landowners and managers resulted in nearly 23 million acres of planned conservation systems and more than 15 million acres of applied conservation systems on grazing lands that produced an overall improvement in grazing lands health. The conservation practice “prescribed grazing” (managing the controlled harvest of vegetation with grazing animals) was applied to more than 12 million acres. Grazing Lands Conservation Initiative. NRCS collaborates with the Grazing Lands Conservation Initiativ (GLCſ), a coalition of producer groups and environmental organizations dedicated to the protection and improvement of private grazing lands. This initiative supported technical assistance, training, and demonstrations targeted to improve the health of grazing lands. Over 800 grazing land demonstrations were held, exhibiting grazing land technologies and management. These demonstrations involved 1,180 farms and ranches nationwide. Over 1,800 education and awareness activities (grazing land workshops, field days, and tours) with over 155,000 participants were conducted. Clean Water Activities. NRCS is addressing key water quality issues such as the potential environmen risks posed by animal feeding operations and impairment of water resources from nutrients, sediments, an pesticides. The Agency is providing leadership to enhance coordination with the Environmental Protectio Agency in areas of mutual interest related to water quality, such as the Concentrated Animal Feeding Operation (CAFO) Rule implementation, the Oil Spill Prevention, Controls, and Countermeasures Rule; Pesticide Drift under the Clean Water Act, and the President’s Executive Order on Chesapeake Bay Protection and Restoration; and water quality credit trading. Comprehensive Nutrient Management Plans (CNMP). In FY 2009, NRCS, conservation partners, and technical service providers assisted nearly 3,800 livestock and poultry producers in the development of CNMPs for their operations. Over 4,300 CNMPs planned in previous years were applied. Nearly 42,000 CNMPs have been developed since FY 2002, with over 31,000 of those implemented. The average CNM takes nearly 150 hours to develop NRCS employees, conservation partners and technical service provider have used over 6.3 million hours since 2002 to develop CNMPs for our Nation's farmers and ranchers. Pathogens and Dead Animals. In FY 2009, NRCS addressed the issue of conservation and pathogens in food safety and disease control by revising its waterborne pathogen publication to reflect current science. The contract that was issued at the end of FY 2007 by California NRCS to the University of California (UC), Davis to update the NRCS publication on waterborne pathogens, was completed to the final draft stage, and at the end of FY 2009, is undergoing Agency technical review. The publication is being reviewed by NRCS technical personnel, personnel from other agencies, and experts from outside the Federal government. The publication will be completed during FY 2010. In FY 2009, UC Davis took the information from the pathogen publication and used it to develop a web-based training course for NRCS employees and technical service providers for use on USDA’s Aglearn on-line training facility. These te modules, complete with narration, are being reviewed and should be completed and available on Aglearn early during the 2010 calendar year. Hypoxia. NRCS provided technical assistance to the Mississippi River/Gulf of Mexico Watershed Nutrie Task Force in its implementation of the Action Plan for reducing the size of the hypoxic zone in the Gulf, restoring and protecting the waters within the Mississippi/Atchafalaya River Basin, and improving community and economic conditions across the Basin. 195 | 25g-5 W ater Quality Leadership. During FY 2009, NRCS led in the development, advancernent, and lemonstration of new and innovative approaches to improving water quality. The following tools and ctivities highlight some of these advances: The Nutrient Trading Tool (NTT) is a web-based model that estimates the changes in nitrogen losses based on improved management practices and calculates nitrogen credits for water quality credit trading projects. In FY 2009, NRCS began validating the model on Maryland's Conservation Innovation Grant water quality credit trading project. NRCS partnered with Iowa State University to develop a Natural Resource Credit Trading Reference for agency and partner use in establishing environmental credit trading projects. The Reference is in final review with an expected publication date at the end of the 2009 calendar year. NRCS provided Departmental support to implement a new Environmental Services Markets provision of the 2008 Farm Bill through the new Office of Ecosystem Service Markets. Natural Resources Inventory and Assessment. CTA Program funds are used to develop products and ervices that enable NRCS to acquire, analyze, interpret, and deliver natural resources data and nformation. Through this business line, the capacity for knowledge-based natural resource planning and ecision-making is available at many landscape levels. ission Critical Analyses and Assessments. Agency, Departmental, and legislative initiatives were pported in FY 2009 by many mission critical analyses and assessments. NRCS natural resources data d information, conservation program data, and data from other Federal and non-Federal sources were ssential components of these analyses and assessments. Important assessment efforts included: Priority Watersheds. NRCS developed National and State-level assessment protocols to identify priority watersheds with a resource-based approach for implementing financial assistance programs. Comprehensive Set of Environmental Indicators. NRCS is a key contributor to the Interagency Working Group on Environment and Natural Resource Indicators, sponsored by the Council on Environmental Quality (CEQ). The Working Group is developing a comprehensive set of indicators to guide the Federal government in reporting regularly on natural resources and environmental issues. FY 2009 and FY 2010 Soil and Water Resources Conservation Act (RCA) appraisal process. National Resources Inventory (NRI) and related Conservation Effects Assessment Project (CEAP) datasets and findings are being used to inform this process. ſational Resources Inventory. Natural resource conditions and trends on non-Federal lands in the United tes are assessed through the National Resources Inventory. The NRI is a longitudinal sample survey ed upon statistical principles and scientific procedures. Non-Federal lands, accounting for more than 79 cent of the total land area in the contiguous U.S., include privately-owned land, Tribal and trust lands, d lands controlled by State and local governments. Information from NRI data and analyses provides the ientific basis for appropriate and effective conservation programs, sound agricultural policy, realistic ategic and performance plans, and national farm policy discussion through the Farm Bill process. veral pieces of legislation authorize the NRI, beginning with the Rural Development Act of 1972. The was conducted on five-year cycles over a 20 year period (1977 to 1997); NRCS currently collects NRI ita annually. The NRI is performed in cooperation with the Iowa State University Center for Survey atistics and Methodology (ISU-CSSM). Annual NRI Data Collection. Information from the Annual NRI data collection is provided on a timely basis to support agricultural and conservation policy development and to help evaluate the impacts of policy execution and conservation program implementation. The Annual NRI data collection is designed to supply long-term trend analyses; however, it has the flexibility to gather scientific information on emerging natural resource issues. Annual NRI data collection is much more efficient than the previous five-year cycle. Every year, data are collected for a scientifically selected subset of the suite of 800,000 NRI sample sites. Rigorous quality assurance procedures are applied to the NRI estimates, and NRI data must measure up to established statistical standards. Data are not released until these conditions are met. Additionally, data must adhere to both NRCS policy, The Office of Management and Budget (OMB) Policy and USDA Quality of Information Guidelines. 196 25g-6 • 2007 NRI Database. A preliminary 2007 NRI database was created in the fourth quarter of Fiscal Yeº 2009. State and National level reviews of the estimates were completed. Final Quality Assurance anc statistical processes are being conducted by NRCS and ISU-CSSM in order to deliver a final database during the first quarter of 2010. This database will provide the framework for the RCA appraisal, various USDA economic analyses conducted by the Economic Research Service, and other strategic policy initiatives, • 2008 Annual NRI. Imagery for 2008 Annual NRI data collection has been processed. Data collection began during the second half of FY 2009 and will be completed by the end of the second quarter of Fl 2010. - • 2009 Annual NRI. Imagery acquisition for the 2009 Annual NRI data collection occurred during the second half of FY 2009. The imagery will be processed and analyzed during FY 2010. • NRI Rangeland On-site Survey. Data were collected in 20 States for the 2009 NRI Rangeland On-site Survey. Field staff used hand-held pocket PC-based data collection tools for this survey. Data editing and quality assurance activities are being conducted. A statistical database has been prepared using rangeland data collected on-site during the interval from 2003 to 2006; an analysis, report, and technical paper are being prepared. Information generated from these studies is used to assess non- Federal rangeland conditions, and to address rangeland conservation programs and policies. • Alaska NRI. Efforts have been made to integrate Alaska into the NRI process, including developmen of a new sampling design and a comprehensive work plan. The original statistical design and plan ar undergoing modification, as acquisition of imagery for many areas of Alaska has been very difficult. Initial data collection is targeted for completion in the third quarter of FY 2010. Release of the estimates and a report on the results are slated for the first quarter of FY 2011. • Inter-agency Collaboration. NRCS is collaborating with the U.S. Forest Service and The Bureau of Land Management (BLM) to develop a consistent methodology for assessing and monitoring all U.S. rangelands. A pilot study was conducted in a 13-county area of Oregon to show that NRI and Forest Inventory and Analysis sampling frames and data collection procedures can be merged to provide a common reporting methodology for both Federal and non-Federal rangelands. Groups such as the Sustainable Rangelands Roundtable and the Society for Range Management have consulted with the Federal agencies on this project. Conservation Effects Assessment Project (CEAP). CEAP is a multi-agency effort to quantify the environmental benefits associated with conservation practices implemented under the 2002 Farm Bill and other related programs. CEAP has two principal components: 1) National Assessment and 2) Watershed Assessment studies. The National Assessment is designed to provide national summary estimates of conservation practice benefits and to assess the potential for USDA conservation programs in meeting the Nation’s environmental and conservation goals. Four sub-components fall under the National Assessment cropland, wetlands, wildlife, and grazing lands. The Watershed Assessment studies are the research portion of CEAP; they provide more detailed, in-depth assessments than are possible with the National Assessment components, and build the science base for conservation. Literature syntheses are associated with each component and are under preparation for Wetlands and Grazing Lands. Current CEAP activitie include: • Cropland Component. The CEAP Cropland report for the Upper Mississippi River Basin (UMRB) was released for peer review in May 2009. This report will be published in early Calendar Year 2010 Executive summary reports for four additional river basins will be released in FY 2010. • Wetlands Component. Riverine and depressional wetland modules are being developed for the Integrated Landscape Model, using results from CEAP-Wetlands regional and watershed studies. A prototype model is available to illustrate real-time monitoring, and simulation modeling and forecasting. The model simultaneously quantifies changes in multiple ecosystem services resulting from conservation practices and program implementation, climate change, land use and management, hydrological dynamics, and other drivers of change. • Wildlife Component. CEAP Conservation Insight reports that present findings of regional studies ha been released. These findings include the wildlife habitat benefits of the Conservation Reserve Program (CRP) on landscape-level grassland bird species richness, the contribution of CRP to - 197 25g-7 priority short-grass prairie bird habitat objectives, and the response of northern bobwhites and other early successional bird species to the CP33 Habitat Buffers for Upland Birds conservation practice in 14 States. - Grazing Lands Component. The grazing lands component is evaluating environmental models to provide estimates of conservation benefits on national and regional scales for the National Assessment. Five different laboratories of the USDA Agricultural Research Service (ARS) are cooperating in this effort. The rangeland sub-component will utilize NRI on-site data to supply watershed level inputs to the selected models. The pastureland and grazed forest sub-component has tested protocols to collect field data for an analogous effort, and has begun collecting NRI data in 16 States during 2009. More than 60 scientists are involved with the development of two separate volumes of literature syntheses for rangeland and pastureland; each will be published by a professional society in 2010. Watershed Assessment Studies. The watershed component provides detailed assessments of conservation practices including observed and modeled environmental effects in selected watersheds. Forty-one individual watershed case studies, representing a wide array of resource issues and modeling techniques, were active in 2009. The watershed studies are making progress on developing new model components and geospatial analyses at the watershed scale to improve the accuracy of model simulations and enhance predictions of practice impacts. One new watershed study to document watershed health and the effects of conservation activities on grazing lands was funded by CEAP partner, USDA’s Cooperative State Research Education and Extension Service (CSREES). Final reports for nine NRCS Special Emphasis Watershed studies were submitted in 2009. These reports, which are currently in review, provide findings on the benefits and effectiveness of conservation programs and practices in addressing specific environmental concerns. Work continues in conducting a major synthesis of the findings to date on the CSREES watershed studies. Lastly, CEAP coordinated with a similar Canadian project called Watershed Evaluation of Beneficial Management Practices. At the Canadian annual investigator meeting, the CEAP Watershed Coordinator delivered the keynote presentation. - nservation Planning and Technical Consultations result in either the transfer of data, information, or a nservation plan that helps customers protect and conserve natural resources (soil, water, air, plant, and imal) within their social and economic interests. Customer Service Toolkit is the primary tool in this business area. Toolkit is a geographic information system (GIS) enabled enterprise application that supports conservation planning and technical assistance to landowners. Using Toolkit, NRCS field office planners “check out” customer specific data from a centralized national database along with customer folders from local file servers. The data and folders contain conservation planning information in Excel spreadsheets, Word documents, image files, and GIS shapefiles. NRCS planners use Toolkit to perform a resource inventory, analyze current land use in relation to geophysical limitations, develop alternative solutions, and prepare a final conservation plan, plan of operations, and high quality client specific maps. Toolkit is installed on over 15,000 NRCS and conservation partner computers and has been implemented in every State with 5,000 to 6,000 unique users accessing the site weekly. Toolkit is one of the first applications to be re- engineered as part of a streamlining initiative. The National Conservation Planning (NCP) database, integrated with the Toolkit, contains over two million conservation plans containing over 35 million practices, and 556,877 contracts. Conservation plans increased in FY 2009 by 13 percent. These plans cover 21 million land units with digital spatial data on over 13.5 million of those land units. A total of over 563 million acres are covered by conservation plans. - A new Conservation Plug-In tool will enable technical service providers, private consultants, and other non-NRCS partners to directly access NRCS conservation planning information to record planning and application progress. Field testing was completed with positive results and NRCS established a national support contract as precursor to national rollout in FY 2010. 198 25g-8 Engineering Field Tools (EFT) application was deployed to about 6,000 NRCS field and district personnel. EFT is an integrated client application to facilitate, capture, and display of field survey d: and design of conservation practices. In FY 2009, EFT updated the structure design and waterways modules and started new development on a terrace design function. Natural Resources Inventory and Assessment includes the acquisition, development, interpretation, and delivery of natural resource data and information for natural resource planning, decision making, and program and policy development at multiple scales. The following improvements occurred in FY 2009: The Water and Climate Information System (WCIS) supports the collection, storage, quality control, analysis, dissemination of high elevation snow pack and climate data for the West, generation of water Supply forecasts, the collection and dissemination of climate data with an emphasis on soil climate data throughout the United States. In FY 2009, WCIS improvements included: National Soil Information Systern integration with geospatial tools used at the field level. Soil Scientist Toolkit for improving soil scientist productivity and data quality. Remote Sensing Toolkit including tools for management, decision support, and communication. The PLANTS database web application provides self-service technology to access and retrieve plant information. In FY 2009, PLANTS had approximately 1.3 million visits per month. The Soil Data Mart facilitates downloading soil surveys in electronic format. It currently provides 3,113 individual soil surveys for 59 States and territories covering a total of 13,250,000 acres. The Geospatial Data Gateway has been integrated with the National Agriculture Imagery Program (NAIP) and Common Land Units (CLU) datasets in the Geospatial Data Warehouse. These element: are the authoritative datasets; they are “on demand” in the standard format and naming conventions. NAIP includes current natural color orthoimagery at one meter resolution. The CLU dataset include farm and field boundaries for USDA service center customers. A total 250,600 orders of soil data were processed through the Resource Data Gateway. The total amount of data delivered from the Gateway has increased annually to nearly 135 terabytes in FY 2009. Web Soil Survey provides self-service technology to access and retrieve soils information, and includes an integrated Resource Data Viewer. It currently averages about 340,000 viewers weekly, Saving staff time at local service center offices. Implementation of the Visual Interactive Prediction and Estimation Routines (VIPER) program for u by the Snow Survey/Water Supply Forecasting Program. VIPER provides improved data visualizati and the flexibility to use different station combinations and data records to users of water supply forecast information. The Agricultural Applied Climate Information System (Ag/\CIS) is now publically accessible throu the NRCS electronic Field Office Technical Guide (FOTG). Through AgACIS, users are able to access quality controlled data made available through the Regional Climate Centers from the Nation Climate Data Center in Asheville, North Carolina, along with specific analyses of the data including temperature, precipitation, growing season, and frost evaluations. A new program that evaluates available working days has also been developed. Completion of the Dugway Proving Grounds Snowpack Telemetry (SNOTEL) master station. After multi-year effort, the process of relocating this master station, which was made necessary by increas problems due to other radio interference at the Ogden master station. Master stations are used to receive and transmit weather data via meteorburst technology collected at remote SNOTEL and soil climate analysis network (SCAN) site locations. Purchased four master stations from Meteorcomm (MCC). These four master stations, located in Ohio, Missouri, Mississippi and Montana will provid support for the SCAN network, NRCS ownership of these sites ensures proper maintenance and continuous access to remote communications. Data Quality Control (QC) efforts now include archived (historical) temperature and precipitation data. This methodology was developed to be flexible to user's needs, allowing for customized specification on risk tolerance and degree of confidence. QC assists water supply forecasters by providing highly accurate, updated data for hydrographic model input and quickly alerting field 199 25g-9 personnel of sensor failures on remote data collection stations. QC of real-time or near real-time data is being pursued through Portland State University (PSU). Additional daily Parameter-elevation Regression on Independent Slopes Model spatial layers were made available in FY 2009 data covering the current month. This data is used in conservation : planning and modeling as well as water supply forecasting. Continued enhancement of the Surface Water Supply Index for inclusion in National Integrated Drought Information System projects in California, Klamath Basin, and Colorado, Upper Colorado Basin, began in FY 2009 to be implemented in FY 2010. Expanded work in specialized Water Supply Forecasting continued in FY 2009 for Indian Tribes in Montana, Idaho, Washington, Arizona, and New Mexico. Montana had five new forecasts established for the FY 2009 water year and will expand in FY 2010. - The National Water and Climate Center produces a weekly Drought and Snowpack update for water and natural resource managers. The report provides a “grab and go” summary that can be easily used for drought and water resource briefings. For more information, please visit the following website: http://www.wcc.nrcs.usda.gov/climateſ. Natural Resource Technology Tool Development and E-Government. Engineers, agronomists, biologists, oresters, soil scientists, economists, and other technical specialists assist the local NRCS staff and enhance he expertise that is provided to all NRCS clients. These specialists develop and transfer new technologies nd a wide array of technical standards and specifications, models, and maps pertaining to conservation stems. The topics include ecological site and forage suitability, phosphorus indexes, snow fences, stream storation, and buffer technology. Information Technology (IT) professionals translate scientific chnology and standards into more accessible electronic formats. These scientists and technical specialists ure the application of sound scientific principles in Conservation Technical Assistance Program tivities. - Transfer includes the process that evaluates, acquires, develops, and transfers nservation tools, techniques, and standards based on research and new technologies. The technology is ed primarily in resource assessment, conservation planning, and conservation system installation. New revised technology tools released in FY 2009 included: A new online training course was developed to help conservation professionals and others with understanding the terminology and basics of air quality, climate change, and energy and their connection to the planning and implementation of conservation practices to benefit the land. Basic and Advanced Prescribed Burning training provided both classroom and on-the-ground applications of prescribe fire elements such as fire ecology, prescribe burn plans, firebreak design, ignition techniques, fire equipment and safety. - There were eight technical notes released with the latest information on Biology and Soil Quality issues. There were ten User Guides released for technology tools related to Engineering and Soil Survey. - Updates to the Economics and Comprehensive Nutrient Management Plan Handbooks were completed and training was provided. National Instructions were posted on (CNMP) Technical Criteria and Soil | Climate Analysis Network Station Investment. | The training course, “Extending Outreach to All Customers” was updated to include Farm Bill functions and policies. A pilot course was conducted with 25 participants from approximately ten States. - A series of Stability and Integrity Technology for Earth Spillways (SITES) workshops were conducted. The software will design a dam or pond to comply with the NRCS criteria in Practice Standards 402 for dams or 378 for ponds. The SITES computer model is instrumental in the design and rehabilitation of watershed dams. Updated about 21 percent of 165 practice standards including revision of the Integrated Pest Management (EPM) standard with risk reduction techniques to address identified hazards related to 200 25g-10 cultural, biologica; and chemical pest suppression strategies. These new and updated standards reflec evidence-based science, and help producers address critical issues. Using program contracts, easements, or other means, NRCS provides cost share financial assistance and monetary incentives to qualified program participants to implement conservation practices. During FY 2009, NRCS underwent an Independent Audit by KPMG. In support of NRCS Audit needs, the Review of Open Obligations Tool (ROOT) was developed that allowed efficient and effective review of 196,400 ope obligations. In addition to saving state and field staff hundreds of hours, the review could not have been completed in a timely manner without ROOT. ProTracts is a web-based application that helps NRCS efficiently manage applications, contracts, obligations, payments, and performance reporting. This is the primary electronic tool used by NRCS and partners to develop and manage contracts associated with NRCS’ financial assistance programs. • Through ProTracts, NRCS employees processed 79,760 applications, 27,715 contracts, and obligated $1.1 billion in FY 2009 for four financial assistance programs: EQIP, CSP, WHIP, AMA, and CBWP. Using ProTracts, employees processed $0.9 billion in payments in FY 2009. , total of $5.1 billion - • Payments have been processed through ProTracts which currently contains $6.8 billion in obligations. • ProTracts ranking tool was nationally deployed to provide a uniform method of evaluating and ranking contract applications. This tool provides uniform business rationale that ensures the most environmentally deserving lands receive conservation in a cost-effective manner. • Continued use and enhancements to Fund Manager speeds both the obligation and payment proce while enforcing internal controls associated with recording financial transactions. Fund Manager links ProTracts and the NRCS’ accounting system. With this web application, NRCS continues to pioneer new approaches to utilize web applications to interface transactions electronically to National Finance Center and thereby speed payments to program participants. Compliance Status Reviews for Highly Erodible Land and Wetlands. Compliance status reviews are conducted on farm and ranch tracts designated as having received USDA benefits subject to the Highly Erodible Land (HEL) or Wetlands Conservation (WC) provisions, or both. A compliance status review is an inspection of a tract to determine the USDA participant's compliance with the HELC/WC Provisions o the Food Security Act of 1985, as amended, as a condition for receipt of certain USDA benefits. The NRCS compliance status review process requires employees to make an on-site determination when a violation of the HELC/WC provisions is found, and ensures that only qualified NRCS employees report violations. Analysis of FY 2009 compliance reviews will be available after February 2010. In FY 2008, approximately 1.5 percent, 333 of the 22,755 tracts reviewed, were found to be in non-compliance. Of these, 211 tracts had Highly Erodible Land Conservation violations and 122 tracts had Wetland Conservation violations. Penalties for non-compliance range from a Good Faith exemption from the Farm Service Agency (FSA) that allows the producer one year to correct the violation, to FSA determining the producer is ineligible for any government payment and must pay back any current year funding. Highly Erodible Cropland Conservation Compliance. Participants in USDA programs are required to protect their fields from excessive soil erosion, (sheet and rill, wind, and ephemeral gully), by complying with HEL regulations found in the provisions of 16 U.S.C. §§ 3801; 3811-3814. USDA participants accomplish this by implementing a conservation system that provides for either a substantial reduction in soil erosion, or when Sodbusting native vegetation, a system that results in no substantial increase in soil erosion on Highly Erodible Cropland. NRCS classifies about 101.1 million acres of cropland as HEL, 27 percent of the Nation’s 370 million acres of cropland. Reviews were conducted on 22,755 tracts (over 3.3 million acres). Of the total HEL tracts in compliance, 880 tracts were issued variances or exemptions as provided by statute. All tracts with a variance or exemption were re-evaluated during the 2009 crop year to ensure that an appropriate conservation system 201 25g-11 being used. Of the total variances, 397 tracts were issued due to a minimal effect determination on the total conservation system effectiveness. The (FSA) county committees granted Good Faith exemptions where a violation was reported for 67 (7.6 percent) tracts. Wetlands Conservation Compliance. Title XII of the Food Security Act of 1985, 16 U.S.C. §§ 3801; 3821- 2824 defines NRCS’ responsibilities in wetlands conservation which includes determinations, appeals processing and resolution, mitigation and restoration plans, minimal effect exemptions, and scope and affect evaluations for installation of new drainage systems and maintenance of existing systems. During 2008, wetlands were present on approximately 53 percent (12,084 of 22,755) of the randomly selected tracts on which compliance reviews were conducted. One hundred twenty-two wetland tracts were not in compliance. - TA Program Funds Customer Assistance. Through CTA, NRCS provided technical assistance to 82,912 customers in FY 2009 helping them to plan and apply conservation measures on the land. This is about 57 percent of the Agency’s customer contacts for conservation planning or implementation. RCS serves, either directly or indirectly, all of the people of the Nation. However, the people who make decisions about natural resource use and management on non-Federal lands are the primary customers. hey include individuals, groups, Tribes, and units of government. NRCS provides the technical assistance and science-based information customers need to make good decisions about their natural resources. To achieve its mission, NRCS provides services to four main customer groups: Farmers and ranchers, people who own, operate or live on farms and ranches; Other members of the private sector who support production agriculture and conservation; Government and units of government including Tribes with responsibility for natural resource use and management; and - - Non-profit organizations whose mission aligns with aspects of natural resource management. ese major customer types need different products and services, delivered in different ways. Within each ajor customer category, there are customer segments that have differing needs. TA Program Leverages Technical Assistance. NRCS field staff work in partnership with over 8,100 State Agency and conservation district personnel to assist customers with their conservation planning and mplementation needs. Non-Federal partners contributed an estimated $387 million in funds and services o support these joint conservation efforts in FY 2009. This leveraging is made possible through mutual greements that establish a conservation partnership with State Governments, local soil and water - onservation districts, Tribes, and other conservation organizations to formulate and implement an ntegrated conservation program. By working with partners, NRCS ensures that the conservation goals of he landowner, local government, State agencies, and national interests are achieved. Technical Service Providers and Agriculture Conservation Experienced Services. NRCS expanded its echnical assistance capability with Technical Service Providers (TSP) and Agriculture Conservation 3xperienced Services (ACES) workers in FY 2009. - TSPs are individuals and organizations that are qualified and certified to provide specific technical services or conservation planning and application. These TSPs have expanded and accelerated NRCS’ ability to lan and apply conservation practices to enhance, restore or conserve the Nation's soil, water and related atural resources on non-Federal land. In FY 2009, NRCS: - Signed agreements or renewed the certification of 423 individual TSPs and 21 businesses. There are now more than 1,110 individual TSPs and 88 businesses certified and available to help program participants apply conservation. In FY 2009, $47 million was obligated through TSPs. The most common plans and practices implemented with the technical assistance of TSPs included nutrient management plans, conservation crop rotations, pest management plans, upland wildlife 202 25g-12 habitat management, prescribed grazing, residue and tillage management, Comprehensive Nutrient Management Plans, and livestock waste storage facilities. • Forty seven percent of the financial obligations under this initiative were made to private sector TSPs. Programs accounting for the majority of the FY 2009 obligations included: Environmental Quality Incentives Program, 36 percent, Watershed Rehabilitation Program, 17 percent, Conservation Reserve Program 7 percent, and the Wetland Reserve Program, 6 percent. The remaining obligations were distributed among approximately twenty other conservation programs. ACES has evolved from a three year pilot project to utilizing experienced workers to help agency employees address high workload goals and better serve our customers. It is a cost effective cpportunity t obtain the services of experienced workers on a temporary basis through an agreement with eligible nonprofit organizations. NRCS has obligated $7.6 million in ACES, International Assistance. During FY 2009, NRCS employees participated in 33 assignments with 14 foreign countries that improved the management and conservation of natural resources globally. NRCS is recognized worldwide as the premier enabler of natural resource conservation. International activities involve both short and long-term technical assistance and leadership for the development of natural resource conservation programs and projects. Additionally, NRCS facilitates the exchange of conservatio technology with countries that face soil and water conservation issues similar to those in the United States NRCS participates in international meetings and professional societies to share NRCS conservation technology and to broaden the knowledge and professional capability of NRCS staff. Reimbursed Technical Assistance: NRCS provides reimbursable short-term technical assistance to foreign countries where the primary benefit is to the receiving country. In FY 2009, the U.S. Agency for International Development (USAID) through the Foreign Agricultural Service (FAS) reimbursed NRCS approximately $103,500 for assistance to Afghanistan and Iraq. The reimbursement paid for two NRCS employees who provided training to new USDA personnel selected for Operation Enduring Freedom and Operation Iraqi Freedom and four two-month details in Afghanistan supporting U.S. military/civilian Provincial Reconstruction Teams. FAS reimbursed the Agency $12,400 for a soil survey project in the United Arab Emirates. USAID through FAS also reimbursed NRCS $11,500 to help train Mexican personnel in plant materials. Long Term Details: Through Operation Enduring Freedom and Operation Iraqi Freedom, USDA improves the natural resources in the rural provinces which results in a more secure and stable environment. NRCS provided training in planning, designing, and implementing erosion control, streambank stabilization, forestland and rangeland management, and soil and water conservation programs that puts thousands of local civilians to work restoring and rehabilitating their respective country’s environment. During FY 2009, 11 NRCS employees served as advisors to Afghanistan and ten employees served in Iraq. These were 12-month assignments. Total salaries were $1.2 million for employees in Afghanistan and $1.9 million for Iraq. All salaries were paid by non-NRCS USDA or the Department of State. Other FY 2009 International Assistance: • Pacific Basin. One conservationist in the Pacific Basin provided technical services and leadership in initiating, developing, and coordinating natural resource programs in the Federated States of Micronesia and the Republic of Palau. NRCS spent nearly $400,000 on these long-term assignments. • Border Issues. NRCS collaborated on border issues with agricultural producers and Resource Management Agencies in Canada and Mexico. NRCS collaborated on issues including water quality, range management, biological diversity, aquatic resource management, hydraulic modeling, plant materials, snow survey forecasting, stream restoration, and waste and nutrient management. • Hosted Foreign Visitors. NRCS employees hosted approximately 100 foreign students, technicians, scientists, administrators, and farmers from 31 countries and enabled them to transfer applicable methods to their home countries. 203 25g-13 NRCS Scholarship Programs. NRCS participates in the USDA/1890 National Scholars Program (1890), USDA Public Service Leaders Scholarship Program (PSLSP), NRCS Asian Pacific Islander Scholars (API) und the NRCS Tribal Scholars to support the Agency’s Human Capital Initiative. These scholarship jpportunities strengthen the conservation partnership with State Colleges and Land Grant Institutions and help attract outstanding students from underrepresented groups to pursue careers in agriculture and natural resource sciences. In FY 2009, NRCS sponsored nine 1890 scholars, two PSLSP, and four API scholars. Df the fifteen scholars, six graduated from various programs and were non-competitively converted into the NRCS workforce. NRCS Outreach Partnerships. NRCS partners with the 1890 Land Grant community and participates in the JSDA 1890 Task Force Initiatives. NRCS collaborates with selected 1890 Land Grant Colleges and Universities to broaden the transfer of technologies through the 1890 Centers of Excellence to the ommunities they serve through the Biological and Agricultural Systems Engineering programs, and the 890 National Scholars Program. The Centers of Excellence supported by NRCS focus on Air and Water ality (Florida A&M University), Grasslands (Langston University), Geographic Information System and emote Sensing (Lincoln University), Savannah River Environmental Sciences (South Carolina State niversity), and Plants and Water Quality (Virginia State University). NRCS continues to achieve results s the initiatives meet unique conservation needs and challenges while implementing new site-specific chnology and developing comprehensive resource plans. CS has partnered with community based organizations through contribution agreements to assist new igrant and specialty crop farmers with record keeping needs and applied technology to help increase e adoption of conservation measures and systems on their operations. This work was done with Hispanic nd Asian farmers in several States, including Florida, California, Arkansas, and Washington, mall. Limited Resource, and Begi Farmers and Ranchers. With technical and financial assistance eared to their unique needs, NRCS helps small, limited resource, beginning, and socially disadvantaged ers and ranchers maintain the economic viability of their farm operations while conserving natural sources. The Agency works to ensure that there are no barriers or obstacles to prevent this group of ers and ranchers from fully participating in NRCS programs or receiving technical assistance. In FY 2009, $136 million in EQIP was approved to reach 1,034 limited resource and 4,049 beginning farmers and ranchers to implement sound conservation practices on 1,401,639 acres of working land. Cost-share rates from Farm Bill conservation programs are up to 90 percent under this initiative. NRCS approved 36 percent of the applications received from these groups compared to 29 percent for the general applicant pool. - In FY 2009, NRCS approved 1,462 socially disadvantaged farmers and ranchers for EQIP contracts totaling $43 million. NRCS approved 40 percent of the applications received from potential socially disadvantaged farmers and ranchers, as compared to 29 percent for the general applicant pool. hrough grants NRCS provided $500 thousand to five Centers of Excellence in Fiscal Year 2009. These rants focused on: Air and Water Quality (Florida A&M University); Grasslands (Langston University); - Geographic Information System and Remote Sensing (Lincoln University); Savannah River Environmental Sciences (South Carolina State University); and Plants and Water Quality (Virginia State University) CS continues to achieve results as the initiatives meet unique conservation needs and challenges while lementing new site-specific technology and developing comprehensive resource plans. ssistance to American Indians and Alaska Natives . NRCS established three conservation erships with Tribes during FY 2008: (1) A new contribution agreement with Intertribal Agricultural 204 25g-14 Council to provide basic tax instruction and education to Tribes and Tribal operators who wish to participate in NRCS conservation programs. (2) A new contribution agreement in the amount of $15,000 with the Tohono O'odham Community College to establish a garden for producing native food and plant materials. (3) Two new and one renewed Tribal Conservation District mutual agreements between the Secretary of Agriculture and three Tribes — one in Alaska (Kwethluk), one in Nevada (Ely Shoshone) and another in Arizona (Hopi). Currently there are 33 recognized Tribal Conservation Districts nationwide. Accountability and Management Improvements. NRCS took a number of steps to improve accountability and management in FY 2009, which included: NRCS is sponsoring three USDA Native American Tribal scholarships in the amount of $45,000. The tribal scholars are attending the following schools: (1) Northwest Indian College, Washington State; (2) Haskell Indian Nations University, Kansas; and (3) Montana State University. NRCS rolled out the “Tribal Consultation, A Guide for Natural Resources Conservation Service (NRCS) Employees” at the annual American Indian Alaska Native Annual Employee 2009 Training Conference and via a national instruction to all employees. The guide is intended to assist NRCS managers and staff whose duties include coordination of NRCS programs and consultation with American Indians and Alaska Natives Sovereign Nations. - Worked collaboratively with department of Interior Bureau of Indian Affairs to develop Wetlands Reserve Program (WRP) contract language for WRP program dealing with the new 30 year contracts on tribal land and other Farm Bill program components. As a result, four agreements were executed ir Nebraska, encompassing 2,200 acres and $2.2 million with four Tribes. Offices Serving Tribes: As of October 2009, NRCS has 45 full-time offices on Tribal lands and approximately 230 Tribal liaisons assisting 562 Federally-recognized Tribes. Program Participation: In FY 2009, NRCS awarded 488 Environmental Quality Incentives Program (EQIP) contracts to Tribes and Tribal members in the amount of $21.4million. The American Indian and Alaska Natives received 2.9 percent of the total contracts funds approved for EQIP. NRCS awarded 52 Wildlife Habitat Incentives Program (WHIP) contracts to Tribes and Tribal members in the amount of $3.1 million. The American Indian and Alaska Natives received 6.1 percen of the total contract funds approved for WHIP. NRCS awarded one Agricultural Management Assistance Program contract to a Tribe in the amount o $21,189 and one Chesapeake Bay Watershed Initiative contract in the amount of $1,800. NRCS awarded 12 Agricultural Water Enhancement Program contracts to Tribes and Tribal members in the amount of $1.5million. American Indian and Alaska Natives received 2.5 percent of the total funding. • Focusing on twelve key risks and twenty-five Quality Assurance categories in ten operations management reviews that resulted in follow-up and oversight of these risks and categories. • Developed nationwide scorecards of Agency key priorities and risk areas to monitor for improvement in efficiency and effectiveness. • Conducted eight program assessments, four oversight studies, ten Operations Management Reviews, four administrative reviews, and thirteen civil rights reviews resulting in corrective action plans. - • Conducted Highly Erodible Cropland Conservation and Wetlands Conservation Compliance on 22,755 tracts. -- - • NRCS has undergone the first stand-alone Agency financial audit with corrective actions being taken during and subsequent to the audit process. -' o The audit indicated that NRCS must improve its accounting and financial practices and procedures. - o NRCS has conducted a thorough review of all current obligations, existing policies, and procedures. NRCS is also strengthening the organizational structure of the Financial Management area. o Since completion of the initial audit, NRCS has completed a review of 100 percent of al open obligations, trained employees on policies and procedures, and conducted twenty State reviews to ensure compliance with open obligation policies. In addition, NRCS 205 25g-15 Financial Management Division and the Oversight and Evaluation Staff completed evaluations in 20 States on the validity of the Open Obligation Review completed by the Agency. - o Future planned actions include the development of policies, training, and quality assurance activities related to undelivered orders, unfilled customer orders, proper accrual and disbursement procedures, real property management, accounting procedures, and agreements with non-Federal partners. - - o For NRCS partners, the financial procedures instituted as a result of the audit will potentially cause some changes, particularly in the handling of leases for office space and the frequency of submitting invoices and progress reports for agreement payments. • Implemented a standard State quality assurance plan process to ensure nationwide internal controls are followed in Operational Management Reviews. • Developed an audit tracking system for tracking progress on recommended actions and to facilitate a process to analyze weaknesses identified in all audits. • Continued to upgrade Agency accountability software applications and hardware security to correctly safeguard all private and sensitive information, including Personally Identifiable Information (PII), in compliance with the Federal Information Security Management Act and National Institute of Standards and Technology (NIST) Special Publication (SP) 800-53. • Conducted a customer service survey resulting in improvements in the Farm and Ranch Lands Protection Program. - - - • Developed the Integrated Data Enterprise Analysis (IDEA) web application which is an integrated conservation planning, financial management and Geographic Information System that contains management information that reduces workload. SOIL SURVEY * rrent Activities pose. Understanding and managing soil as a strategic natural resource helps sustain the health and onomy of the Nation. Soil survey is an essential tool for regional and local conservation planning that lows people to manage natural resources. The NRCS Soil Survey Program is mandated to: Inventory and map the soil resource on all lands of the United States. Keep soil surveys relevant to meet emerging and ever-changing needs. Interpret the data and make soil survey information available to meet public needs. Lead the National Cooperative Soil Survey Program. |ientists and policy makers use soil survey information in studying climate change and evaluating the tainability and environmental impacts of land use and management practices. Soil Surveys provide ut data that computer simulation models use to predict the dynamics of carbon, nutrients, and water in iłs. Soil surveys are used by planners, engineers, farmers, ranchers, developers, and home owners to aluate soil suitability and make management decisions for farms, home sites, subdivisions, commercial d industrial sites, wildlife and recreational areas, etc. tional Cooperative SoilSurvey. NRCS is the lead Federal agency for the National Cooperative Soil ey (NCSS), a partnership of Federal land management agencies, State agricultural experiment stations, ivate consultants, and State and local units of government, NCSS promotes the use of soil information, d develops policies and procedures for conducting soil surveys and producing soil information. NRCS ovides the scientific expertise to enable the NCSS to develop and maintain a uniform system for mapping d assessing soil resources which allows soil information from different locations to be shared regardless which agency collects it. NRCS provides most of the training in soil survey to Federal agencies, and Fº with their soil inventories on a reimbursable basis. - 206 25g-16 Standards and Mechanisms for Soil Information. NRCS is responsible for developing the standards and mechanisms for soil information on national tabular and spatial data infrastructure required by Executive Order 12906. In the last few years, NRCS has been perfecting a National Soil Survey Information System (NASIS), and producing publications that are accessible to the public through the internet http://soils.usda.gov. In FY 2003, NRCS developed the Soil Data Warehouse to archive soil survey data and the Soil Data Mart to distribute data to the public. In FY 2005, NRCS established the Web Soil Surve internet site. This became the primary way of distributing published soil surveys, making it easier to keep soil information current with continual public access. Key Elements of the Program. The primary focus of the Soil Survey Program is to provide current and consistent map interpretations and data sets of the soil resources of the United States. The Soil Survey Program has recently been restructured into 143 Soil Survey Offices covering the United States. Their focus is to provide a current, readily available and more useful soil resource inventory, while still completing the initial soil survey mapping. This includes providing useful information to the public in a variety of formats (i.e., electronic and web-based). The program will continue to focus on maintaining quality soil information and helping people understand and use the soil resource in a sustainable manner. Key program elements include: • Mapping. Mapping procedures are managed based on physiographic, rather than administrative boundaries. Soil surveys, based on natural landscape boundaries rather than political boundaries, are more efficient to produce, and provide consistent, quality data for assessing and planning the use and protection of landscape units (watersheds or ecosystems). Physiographic surveys provide consistent data that can be used easily by landowners with holdings in multiple jurisdictions, or by community, State, or regional planners. A primary challenge is to complete the initial soil survey for the entire country. This challenge also includes completing surveys on American Indian land holdings as well public lands controlled by the Forest Service, United States Military, United States Fish and Wildlife Refuges, Bureau of Land Management and National Park Service. Public lands are important to include with private lands when planning land use and conservation for watersheds, landscapes, or ecological sites. NRCS is working cooperatively within the NCSS to accomplish these goals. • Rapid Assessment of Soil Carbon for Conservation Planning. Soil carbon sampling and analysis will be conducted in FY 2010 and FY 2011 to provide data on carbon stocks for the United States by soil groupings, land use and management. - - - • Information Management. NASIS, a part of the NCSS information system, is where soil scientists develop, manage, and deliver soil information to the public. Digital soil surveys enable customers to use electronic soil data in geographic information systems for generating maps tailored to their needs and performing complex resource analyses. NRCS delivers these data via the internet. • Web Soil Survey. In FY 2009, Web Soil Survey was basically in a maintenance status. Only minor changes were made to the application. A feature was added to allow selected internal users to run various metrics reports to show what types of output are being requested most frequently and for wh: areas of the country. Work has commenced on a new version that is expected to be released in the fi quarter of FY 2010. • Digital Soil Surveys. The NCSS develops and maintains two scales of soil surveys: o Soil Survey Geographic Data Base (SSURGO) is used primarily by landowners, townships, counties or parishes, and watershed hydrologic units for planning and resource management. It the most detailed level of soil information. o United States General Soil Map (STATSGO) is used primarily for multi-county, State, river bas planning and resource management and monitoring. • Technical Soil Services. The soil technical assistance function focuses primarily on providing diversified products and assistance in using soil information through USDA service centers. The National Technical Soil Services Handbook will be released in FY 2010. Selected Examples of Recent Progress Acres Mapped. Soil surveys have been prepared on over 2.1 billion acres. During FY 2009, NRCS soil scientists mapped or updated 37.2 million acres, and another 299,000 acres were mapped or 207 25g-17 updated by other Federal, State, and local agencies in cooperation with NRCS. State, local, and other Federal agencies involved in the NCSS provided about nine percent of the funds and seven percent of the personnel services used to produce soil maps and interpretative data. Soil mapping priorities are directed toward completion of all previously unmapped private lands and updating mapping and interpretations to meet current user needs and requirements. - - • SoilSurvey accomplishments on American Indian and Alaska Native lands. NRCS invested $1.0 million in FY 2009 to accelerate soil survey mapping on American Indian and Alaska Native lands, resulting in 2.1 million acres mapped or updated. In addition, three survey areas were published and two surveys digitized with significant American Indian lands (>500 acres/survey area). • Digitized SoilSurveys. During FY 2009, NRCS and NCSS partners digitized 31 soil surveys to national digitizing standards. A total of 3,047 digitized surveys are now available. This is part of an initiative to digitize all modern soil surveys. National digitizing standards for soil surveys have been developed that are consistent with Federal Geographic Data Committee standards. • SoilSurveys Released. Soil surveys for 39 counties or survey areas were released in FY 2009, representing 23.1 million acres. In addition to hard copy, most of these surveys were published on the Web Soil Survey internet application for public access. • Soil Surveys Used Interactively Online. In FY 2009, the Web SoilSurvey website logged over 1.5 million user visits and over 460 million hits. In FY 2009, the users per day averaged over 4,100. • Technical Analysis and Tool Development. The Soil Survey Laboratory (SSL) of the National Soil Survey Center provides analytical support which includes research and methods development and testing, as well as analyses to support on-going soil survey activities around the Nation. In FY 2009, SSL performed over 200,000 analyses and continued its efforts to provide timely data delivery. The SSL developed a method to measure particle size in gypseous soils, developed and is deploying an active carbon kit for field use. SSL added new standard methods to support soil quality and dynamic soil property evaluations. The NSSC awarded four competitive research grants to NCSS cooperators to investigate problems pertinent to soil survey update and enhancement. The SSL Methods Manual, a companion document intended for field use, will be released in FY 2010. - • Research in Soil Geography. NSSC and National Geospatial Development Center have collaborated since 2005 to support research and development into the science of hydropedology and digital soil mapping as defined by the International Union of Soil Science. This research is generally conducted collaboratively with NCSS, University partners, and related institutions. National Cooperative Soil Survey Progress Utilization of Ground Penetrating Radar (GPR). In Massachusetts the SoilSurvey program is utilizing GPR equipment for soil/bedrock depth determinations. Currently there are two update surveys nearing completion in Massachusetts, (Franklin and Plymouth counties). GPR was used in both updates to determine the depth to bedrock within select bedrock controlled map units. Approximately 100,000 points of observation were collected in these bedrock units over the course offive days in the field. This saved the Agency approximately $250,000 compared to conventional hand excavation methods in these bedrock controlled uplands that would have taken weeks to complete. The GPR improves accuracy because stones and boulders in the soil profiles can often be mis-interpreted as depth to bedrock with hand methods. SoilSurvey Assists Transportation Planners. Louisiana NRCS Soil Scientists conducted two one-day workshops for employees from the Louisiana Department of Transportation and Development (LADOTD). Because highway construction and maintenance activities deal directly with soil materials, the value of LADOTD employees understanding the full potential of using the soil survey database is paramount. The workshops concentrated on accessing data from the Web Soil Survey and the Soil Data Mart. Emphasis was placed on building specialized queries to extract information from the soils database that is not available from standard reports. As a result, the soil survey data for all Louisiana parishes have been downloaded, for employee use, to the LADOTD central server. Yakama Nation uses Soil Survey for identifying important habitat. The northern spotted owl is one of many Federally protected species found within the boundaries of the Yakama Indian Reservation in 208 25g-18 Washington State. In an effort to identify areas which will be able to support and sustain the dense mature forests spotted owls and a host of other species depend upon, the Yakama Nation is exploring a variety of land management practices designed to balance their resource, forest management and cultural objectives. Of the many approaches the Yakama Nation is currently exploring the use of Geographic Information Systems (GIS), combined with spotted owl data and a detailed National Cooperative Soil Survey Database. GIS is proving to be highly valuable in indicating where redevelopment and long-term maintenance of dense forest might be most attainable. Using soils data correlated to spotted owl nest sites and movement relocations based on radio telemetry has provided improved resolution on owl distribution and preferred habitat. In addition, the soils data further allowed identification of optimum sites for the development and management of site that have the potential to become future spotted owl habitat. They believe that the cool moist zones identified in the soil survey will increase in importance to nesting spotted owls if the environment of the core demographic area changes due to global warming. New Tool for Soil Survey Mapping. Since 2005, NRCS soil scientists in Vermont have been collaborating with Dr. Xun Shi of Dartmouth College to develop and implement an automated, knowledge-based approach to soil mapping. The major focus of this effort is a computer software called Soil Inference Engine (ArcSIE). This automated mapping approach consists of four major components: a GIS database containing information about environmental conditions at each location in the mapping area; a knowledge base containing soil-landscape models built by local soil scientists; an inference engine that utilizes environmental data and expert knowledge to predict soil conditions; and a fuzzy representation scheme (using a raster data model) to depict predicted soil conditions. ArcSIE provides the user interface and links between these components, as well as tools for result validation, terrain analysis, preand post-processing for data, and data format conversion. The success of this project is largely due to the availability of high resolution (1m) elevation data from Light Detection and Ranging (LiDAR). The bare earth elevation model from LiDAR and the terrain attributes derived from it constitute the most important environmental data layers used to characterize the soil formative environment. In addition, hillshades from this data provide extremely detailed visual representation of landforms and soil parent materials, far superior to any previously available imagery. The Area Vermont-based soil survey staff has utilized ArcSIE to map over 230,000 acres in Essex County since 2007. . SoilSurvey used for Siting Wind Turbines. With the push to search for renewable energy solutions for the United States, the state of Rhode Island is actively pursuing the option of utilizing the wind power that is abundant in much of the coastal area of the state. A map of wind energy throughout the state combined with soil survey data identifying areas of limitation including hydric soils and areas limited by seasonal high water table, bedrock, or slope. This use of soil survey data in planning is a prime example of the ongoing use of soil survey for emerging interpretations and has enabled the State of Rhode Island to focus planning efforts only on land that would be suitable for wind turbine footings, saving both time and money. Soil Survey Saves Local Government Expense, Idaho NRCS has provided the State Tax Commission and county governments soil survey data including forest productivity data that has helped them make fair assessments of properties. In 2009, NRCS was contacted by a northern Idaho tax assessor who needed soil maps and forest habitat types on several hundred thousand acres of private lands within a National Forest boundary. He did not think any of this work had been done and was willing to contract with NRCS to map the soils on all the acres of private lands and then hire foresters to correlate the soil types to forest habitat types. This would have been a costly and lengthy project for a sparsely populated county to fund. Idaho NRCS told the assessor that NRCS had been working with the Forest Service for over a year on extensive database work in order to complete the private lands which had already been mapped. Idaho NRCs provided preliminary soil maps and habitat types to review and utilize until the completed soil survey became available showing how Federal agencies can work together to provide needed products to the public. - 209 25g-19 SNOW SURVEY AND WATER SUPPLY FORECASTING Current Activities - Purpose. The Snow Survey and Water Supply Forecasting (SSWSF) Program provides water and climate information, and technology support for natural resource management in the 12 western States (Alaska, Arizona, California, Colorado, Idaho, Montana, New Mexico, Nevada, Oregon, Washington, Utah, and Wyoming). The National Water and Climate Center (NWCC) located in Portland, Oregon provides leadership and technology support to the States, and directly provides water supply forecasts. Water and Climate Monitoring. Snowmelt provides approximately 50–80 percent of the streamflow in the West. The NRCS conducts snow surveys and provides information that helps Federal, State, and local agencies, power companies, irrigation districts, and the Provincial Governments of British Columbia, Alberta and the Yukon Territory make sound water management decisions. Natural resource data is collected by NRCS from 950 manual snow courses and 790 automated Snowpack Telemetry (SNOTEL) sites in the 12 western States, and a few additional sites located in South Dakota. The SNOTEL and snow course data are used along with data from 485 stream gages, 432 reservoirs throughout the West. NRCS has 1,760 climatological observing stations that are integrated to create basin and watershed analyses and water supply forecasts for 663 water supply forecast points using an automated database and forecasting system. SNOTEL. The SNOTEL network increased to 790 sites in FY 2009. SNOTEL collects the vast majority of the critical, high-elevation snowpack and climate data used to estimate water yields in the mountainous west; and plays a key role in forecasting flooding and other life-threatening snow related events by providing hourly precipitation, temperature, and snowpack depletion information. Snowpack information enables emergency management agencies to effectively anticipate and mitigate flood damage months in advance of the spring snowmelt. This data is also useful in the anticipation and mitigation of the effects of drought. . SNOTEL Data Quality. The National Water Climate Center (NWCC), in partnership with Oregon State University, has completed a program-wide quality control review of SNOTEL temperature and precipitation data collected since 1982. Quality control assists water supply forecasters by providing highly accurate, updated data for hydrographic model input as well as quickly alerting field personnel of sensor failures on remote data collection stations. Quality control of real-time or near real-time data is being pursued through Portland State University (PSU). Master Stations Relocation and Purchase. Master stations are used to receive and transmit weather data via meteorburst technology collected at remote SNOTEL and Soil Climate Analysis Network (SCAN) site locations. The process of relocating the Ogden master station to the Dugway Proving Grounds was completed in FY 2009. Relocation of this station was necessary due to increasing problems with radio interference at the Ogden location. NRCS also purchased four master stations to provide support for the SNOTEL and SCAN networks. The SCAN network is funded through cooperative Federal and non- Federal partnerships and managed through the NWCC. Along with SNOTEL information, SCAN information, collected through 151 sites in 40 States, supports drought monitoring and mitigation activities as part of the National Integrated Drought Information System (NIDIS), flood risk assessments, crop productivity, disease and insect infestation modeling and a wide variety of NRCS Global Change research activities; as well as provides data for soils research, water balance models, watershed planning and weather forecast models NRCS ownership of these sites ensures proper maintenance and continuous access to remote communications. Water and Climate Services. The Water and Climate Services Branch provides water supply forecasts for the Western United States and climate services for the entire Nation. - Water Supply Forecasts. Water supply forecasts are produced from January through June in partnership with the National Weather Service. During the FY 2009, forecast season, the SSWSF Program issued 210 25g-20 12,399 seasonal water supply forecast information products. Major cooperators include the Bureau of Reclamation, Corps of Engineers, Bonneville Power Administration, State and local agencies, power utilities, irrigation districts, Tribal Nations, Canada, and Mexico. Work on developing specialized water Supply forecasts for Tribal Nations in Montana, Idaho, Washington, Arizona, and New Mexico continued in FY 2009 with five new forecast points established in Montana. Among other uses, water supply forecasts are used: (1) by irrigators to make effective use of limited water supplies for agricultural production needs, (2) by the Federal government in administering international water treaties with Canada and Mexico, (3) by State governments in managing intrastate streams and interstate water compacts, (4) by municipalities in managing anticipated water supplies and drought mitigation, (5) by reservoir operators to satisfy multiple use demands, (6) to mitigate flood damages in levied areas and downstream from reservoirs, and (7) to support fish and wildlife management activities associated with species protection legislation. Western Water Supply - Water Year FY 2009 in Review. Precipitation: The major impact during this Water Year was centered over California. As the second year of La Nina was weakening, California entered its third year of drought with state-wide average precipitation departures ranging from 60 to 80 percent of normal. Southern California showed promise of breaking their drought in November and December with exceptional precipitation totals from January through April, precipitation across the entire State was less than 50 percent of the long-term average. However, in May and June, excessive precipitation fell from Arizona and Northern California to the Great Basin. The summer Southwest Monsoon failed to materialize over Arizona and resulted in Tucson receiving only 47 percent of its average precipitation for the months of June- September. Monsoonal moisture resulted in nearer average precipitation over New Mexico. For the remainder of the West, the Water Year was generally above 110 percent of normal precipitation over southern Idaho and along the Northern and Central Rockies. Most of the Pacific Northwest averaged 90 percent of normal for the Water Year. Regionally, March had the largest monthly positive departure from normal for the Northern Tier States, May the largest positive departures over the Cascades, and August the largest positive departures over eastern Oregon and Western Idaho. Snowpack: The 2009 Water Year was near the long term average over much of the West. Exceptions were noted over the Cascades, Northernmost Tier States, southeast Utah, southern Rockies, Sierra Nevada Range, and the mountains in Central Arizona and Southwest New Mexico, where amounts were generally 80 percent of normal. Above normal amounts of greater than 110 percent of normal were recorded over Southern Haaho, Eastern Nevada and Northeast Wyoming. On January 1, snowpack was greater than 150 percent of normal over the 4-Corner States. By February, the snowpack anomalies reversed between the 4-Corner States and the Great Basin and Intermountain West. This pattern remained essentially unchanged for the rest of the snow accumulation season. Snowpack was helped somewhat with below average temperatures mostly over the Northern States and hindered by above average temperatures over the Southern States, as noted by the seasonal temperature departures. The fall temperatures averaged 3°F above normal across the West. Winter temperatures averaged 2°F below normal over the Pacific Northwest and Northern Tier States, but were 2°F above normal over the Southwest. Spring temperatures were 2°F below normal over the Pacific Northwest and Northern Tier States and 2°F above normal over Arizona and the Southern half of the Rockies. Summer temperatures were 3°F above normal over the Pacific Northwest and 3°F below normal over the northern half of the Rockies. Streamflow: Snowpack and precipitation information are the primary drivers of the water supply outlooks. Therefore, the forecasts tracked the ups and downs of the season. In most regions the outlook fluctuated from well above normal flows over the 4-Corner States at the beginning of January to below normal flows by the beginning of May. The reverse situation occurred over the Northern Rockies as cooler than normal temperatures slowed the season snow melt. Near normal forecast flows dominated much of the Pacific Northwest at the start and end of the forecast season while California 211 25g-21 and western Nevada outlooks were calling for below normal flows during the entire winter and spring. Additional water supply forecast information can be found at http://www.wcc.nrcs.usda.gov. Water Supply Forecasting Technology Development. Use of the Visual Interactive Prediction and Estimation Routines (VIPER) program was implemented for the FY 2009 water season. VIPER provides improved data visualization and the flexibility to use different station combinations and data records by users of water supply forecast information. Climate Services Technology Development. . • Agricultural Applied Climate Information System (AgâCIS). is now publically accessible through the NRCS electronic Field Office Technical Guide (FOTG). Through AgACIS, users are able to access quality controlled data made available through the Regional Climate Centers from the National Climate Data Center in Asheville, North Carolina, along with specific analyses of that data including temperature, precipitation, growing season and frost evaluations, - • Geo-spatial data products. Additional daily Parameter-elevation Regressions on Independent Slopes Model (PRISM), and geographical Information System (GIS), data layers were made available in FY 2009. Through a partnership between NRCS and the PRISM Group at Oregon State University, GIS temperature and precipitation data layers are developed which can be used in conservation planning, water supply forecasting and other climatological modeling analyses. • Surface Water Supply Index (SWSI). Enhancement of the Surface Water Supply Index for inclusion in NIDIS projects in California, Klamath Basin, Colorado, and Upper Colorado Basin continued with the goal of implementation in FY 2010. - Information Systems. The database and forecast system maintained by the NWCC Information Systems supports a wide variety of software used for water supply forecasting, water and climate data analyses, and other products used in water resource management and related natural resource conservation activities at NRCS, NWCC websites containing snow survey data, water supply forecasts, soil moisture data and other products recorded over 2.4 million visits with 17.7 million files downloaded during FY 2009. The views and downloads of the information from State NRCS websites are similar to the information from other sites such as the National Weather Service website which utilize Snow Survey data. The NWCC has developed and is implementing a failover plan for all data collection and product production activities. PLANT MATERIALs CENTERS Current Activities As part of the NRCS Plant Materials Program, the Agency operates and provides technical assistance to 27 Plant Materials Centers (PMCs), throughout the United States (U.S.). The PMCs provide effective vegetative solutions to conservation problems and resource issues such as energy independence and climate change. The network of PMCs is the only national organization of its kind positioned to find and test vegetation to address our Nation's natural resource challenges. The PMCs (1) develop technology for the effective establishment, use, and maintenance of plants, (2) assemble, test, select, and release stock to provide for the commercial production of plants to protect and conserve our natural resources, (3) study and characterize plant attributes to provide data and information important in operation of predictive models and effective management of climate impacted plant resources, and (4) provide appropriate training and education to NRCS staff, partners, and the public. NRCS operates 25 of the PMCs; State or local governments operate two with NRCS funding and/or technical assistance. NRCS owns the land where 12 PMCs operate while Conservation districts, State agencies, nonprofit institutes, or other entities own the land where the other 15 PMCs operate. Each PMC has a service area defined by ecological boundaries, and addresses high-priority conservation concerns within their service area. When coordinating across service areas, PMCs have the ability to evaluate vegetative technology and solutions which will impact large regions of the U.S. 212 25g-22 Development and use of plant technology is one of NRCS’ foundation products and services. PMCs are placing special emphasis on the following activities that are aligned with the USDA and NRCS Strategic Plans, and specific conservation concerns within each PMC service area: 1. Climate Change - Protection and revegetation of land greatly affected or completely devastated by hurricanes, floods, wildfires, and other natural disasters; control of introduced weeds, and restoration of areas where weeds have invaded; 2. Wildlife Habitat - Plant materials technology support for wildlife species of concern, such as sage grouse, quail, and pollinators; t 3. Energy Independence - Continued development of plants useful for biofuels, such as switchgrass as well as non-traditional biomass crops; 3 4. Ecosystem Health (biodiversity) - Protection of grazing and other natural resources (range, pasture, and forestland) by developing productive, longer-lived, drought tolerant native varieties, and managing desirable native plants to control the spread of noxious weeds; - 5. Sustainable Soils - Reduction of erosion from cropland by selection of cover crops, and development - of systems for their use to provide winter cover on fields with low residue crops; 6. Clean Water - Improvement and protection of the quality of surface and groundwater by development of filter strips between cropland and streams, plants and technology for bio-terraces, and artificial wetlands for removing pollutants from waste water; creation, restoration, or management of wetlands; and, 7. Clean Air - Development of plants and plant technology for mitigation of air quality concerns in the vicinity of poultry, swine, and beef operations. - PMC plant materials, plant technology, and management practices are key products and services used by customers in the successful implementation of other USDA conservation programs and initiatives such as the Environmental Quality Incentive Program, Wildlife Habitat Incentive Program, Grazing Lands - Conservation Initiative, and the Conservation Reserve Program. With plants and plant technology, PMCs improve grazing lands, wetland and wildlife conservation habitat, buffers and riparian areas, and areas susceptible to soil erosion. PMC plants and technology slow the spread of invasive species and improve critical habitats for threatened and endangered species. Examples of Recent Progress - Comparative Plant Testing. During FY 2009, over 10,300 plant collections were comparatively evaluated in more than 66,000 plots by the PMCs. The final evaluation of new plants and cultural methods is made on farms and ranches under actual use conditions. These field tests are now underway at over 2,200 sites. Plants were evaluated for protecting range, pasture, and forest resources; cropland cover crops; wetlands; plants useful for biofuels; stabilizing critical areas such as sand dunes, streambanks, and shorelines, road cuts and fills, utility corridors and surface mined lands; introducing grass hedges, buffer strips, replacement of annual forage plants with perennials, and wind breaks to protect cropland; and mitigation of air quality concerns. Current emphasis is placed on the collection and evaluation of native plant materials for these uses. Plant Releases for Commercial Production. NRCS released 16 new plants to commercial growers during FY 2009. These 16 join approximately 600 other PMC conservation plant releases used in conservation programs. PMCs select and then distribute plants for conservation uses to the commercial sector for sale to the public. PMCs do not sell or give plants directly to the public. Production by commercial seed growers and nurseries of about 450 of these plant releases has a market value of more than $100 million per year. A recent analysis of the commercial and ecological benefits of NRCS conservation plants showed that the Plant Materials Program returns $3.65 for every $1 invested. Plant Releases and Technology Products. Written technical notes, Field Office Technical Guide and web-postings, and oral presentations transfer new information to end-users. Fiscal Year 2009 accomplishments include: 213 25g-23 Major Item Measured Sub-item Measured # Units Plant Releases - Cultivar releases 3 . Selected releases .. 1} Source Identified releases 2 Total Release 16 Written Technology Transfer Technical Notes & Articles - 108 - Brochures & Flyers 44 Plant Guides & Fact Sheets 70 Popular Articles & Progress Reports 200 Refereed publications - 11 Published symposia & posters 23 Other types of documents - 35 - Total Written Technology Transfer 491 Oral Technology Transfer Training Sessions 461 Tours presented 11 1 Field Days conducted 6 Local/State presentations 138 Regional presentations 85 National/International presentations 33 Total Oral Technology Transfer 534 Plants for Solving Conservation Problems. The Plant Materials Program places emphasis on using plants to solve conservation problems. A few representative examples will illustrate this effort. Plants for energy independence. To meet energy and global climatic concerns, PMCs are investigating native plants with greater above- and below-ground biomass with potential for sequestering more carbon and reducing the amount of atmospheric carbon dioxide. At the same time, plants with more biomass show promise for use as an alternative fuel. PMCs in Michigan, New York, Kansas, Texas, New Jersey, Washington, Idaho, Arizona, California, Montana, and Colorado are a few of the PMCs involved in this work. - Wildlife. Resource conservation and land management practices place emphasis on creating favorable habitat for wildlife species while providing suitable forage for their use. During the past year, Centers in Georgia, Michigan, Missouri, New York, and Hawaii have been active in this area. Pollinators. The need for increased habitat for native pollinator species is becoming critical. PMCs have installed demonstration plantings, hosted workshops and developed publications to promote increased habitat. PMCs have also released plants having value for pollinators. Many PMCs, including those in California, Oregon, Montana, Arizona, Texas, Michigan, New Jersey, New York, Maryland, and Florida are leading this work. Weeds. Exotic, noxious weeds pose a serious threat to the integrity and health of natural ecosystems throughout the country, PMCs conduct studies that strive to either control or suppress weeds, or to find suitable replacements for invasive species once control is achieved. Centers in Washington, Montana, Florida, and New Mexico have worked with problem species such as yellow starthistle, cheatgrass, knapweed, Canada thistle, and cogon grass. Wetland Restoration. Wetlands continue to be an important environmental concern, with a critical need for plant materials suited to their restoration and maintenance. PMCs in Louisiana, Michigan, New Jersey, and Idaho have worked on this problem. Plants to reduce climate change impacts and the effects of wildfires. The Plant Materials Program provides materials and technology to help protect property from the risks of wildfires, as well as methods and materials to enable improved rehabilitation of both private and public lands after fires occur. Assistance is actively provided by PMCs or specialists in Idaho, Washington, Arizona, New Mexico, Colorado, California, Nevada, and Montana. 214 25g-24 Cooperation with Other Agencies and Partners. PMCs cooperate with other Federal and State agencies, agriculture experiment stations, State departments of natural resources, conservation, wildlife, and seed and nursery associations improves the quality and efficiency of plant identification, testing and evaluation, and encourages commercialization of NRCS plants and technology. Employees of other government agencies and conservation districts collect thousands of plants annually to find valuable species for solving conservation problems. The cooperation also extends to the testing and promotion of new materials and technology. PMCs are working extensively with the Agricultural Research Service (ARS), Forest Service, and the Bureau of Land Management on the restoration of degraded rangeland and the revegetation of lands scarred by wildfires. PMCs in the eastern United States are working with the ARS to test the nutrition and regrowth of native grasses for use as forage in pastures. Additionally, PMCs and the National Park Service continue an excellent cooperative effort to revegetate disturbed sites in parks with local native plant materials. This effort has been used as a prototype for developing comparable projects with other cooperators. These partnerships and other similar ones expand the efforts by PMCs to accomplish work which would not be possible by PMCs acting alone. . 215 25-28 NATURAL RESOURCES CONSERVATION SERVICE Watershed and Flood Prevention Operations The estimates include appropriation language for this item as follows (new language underscored; deleted matter enclosed in brackets): Watershed and Flood Prevention Operations [For necessary expenses to carry out preventive measures, including but not limited to research, engineering operations, methods of cultivation, the growing of vegetation, rehabilitation of existing works and changes in use of land, in accordance with the Watershed Protection and Flood Prevention Act (16 U.S.C. 1001-1005 and 1007-1009), the provisions of the Act of April 27, 1935 (16 U.S.C. 590a-f), and in accordance with the provisions of laws relating to the activities of the Department, $30,000,000, to remain available until expended, of which $22,111,000 shall be for the purposes, and in the amounts, specified in the table titled “Congressionally Designated Projects” in the statement of managers to accompany this Act: Provided, That not to exceed $12,000,000 of this appropriation shall be available for technical assistance.] (7 U.S.C 22096,2225; 16 U.S.C. 1001-1005, 1007-1009; Agriculture, Rural Development, Food and Drug Administration, and Related Agencies Appropriations Act, 2010.) The change in language reflects the budget proposal to provide no funding for this account, 216 25-29 NATURAL RESOURCES CONSERVATION SERVICE Watershed and Flood Prevention Operations Small Total Watersheds Watersheds Watershed Authorized Authorized and Flood by PL-534 by PL-566 Prevention Appropriations Act, 2010....................................... $5,146,000 $24,854,000 $30,000,000 Budget Estimate, 2011 ...................... ** gº tº tº use Decrease in Appropriations -5.14 * º Summary of Increases and Decreases (On basis of appropriation) 2010 Program 2011 Item of Change - Estimated Pay Costs Changes Estimated Watershed & Flood Prevention — Regular Appropriation: 1. Watershed Oper. Auth. by PL-534.............. $5,146,000 -- –$5,146,000 ** sº 2. Small Watershed Auth, by PL-566.............. 24,854,000 -- -24,854,000 tº ºft Total Available 30,000,000 wººs. –30,000.000(1) gº tº Project Statement (On basis of appropriation) 2009 Actual : 2010 Estimated : Increase : 2011 Estimated : Staff: : Staff. Or : : Staff Program Amount:Years: Amount Years: Decrease Amount : Years Watershed & Flood Prevention – Regular Appropriation: 1, Watershed Operations : : Authorized by PL-534: : : : : : (a) Technical assistance... $930,000: 12: $1,030,000: 13; -$1,030,000: gº tºs * = (b) Financial assistance ... 6,711,000; --, 4,116,000: -- –4,116,000: fº = * * Subtotai, PL-534 ............ 7,641,000: 12: 5,146,000: 13: -5,146,000: ~~ * * Rºº 2. Small Watersheds : : : : : Authorized by PL-566: : : : : : (a) Technical assistance... 5,703,800: 49: 7,032,000: 84: -7,032,000: ** * tº (b) Financial assistance ... 10,944,200; -- 17,822,000. --, -17,822,000: sº sº. * * Subtotal, PL-566 ............. 16,648,000: 49: 24,854,000: 84: -24,854,000: *** tº sº Total, Appropriation........... 24,289,000, 61; 30,000,000; 97: -30,000,000; tº º sºº 217 25-30 _2009 Actual : 2010 Estimated : Increase : 2011 Estimated : Staff. : Staff. {}ſ $ : Staff Program Amount:Years: Amount :Years: Decrease Amount : Years Watershed & Flood Prevention — Supplemental Appropriations: g 1. Emergency Watershed : : : Protection Operations: : : : : (a) Technical assistance... --: 240: --: 586: tºº *** * gº (b) Financial assistance ... •-. --. --. --. & º sº ºf * * Total, Appropriation........... - --: 240: --, 586: ºg sº ** *** Project Statement - (On basis of available funds) 2009 Actual__2010 Estimated : Increase : 2011 Estimated : Staff. : Staff. Gr : Staff Program Amount: Years: Amount :Years: Decrease Amount : Years Watershed & Flood Prevention — Regular Appropriation: 1. Watershed Operations : : Authorized by PL-534: : : : : : (a) Technical assistance. $989,669: 12: $1,724,362: 13: -$1,724,362: Eº nº sº wº (b) Financial assistance. 2,102.010: --; 12,395,000; --: -12,395,000: ge tº ** Subtotal, PL-534 .......... 3,091,679: 12: 14,119,362: 13; -14,119,362: tº gº gº tº 2. Small Watersheds : w - . º : - Authorized by PL-566: : : : : : (a) Technical assistance. 7,433,829: 49: 12,542,000: 84; -12,542,000: tºº-ºº: gº ºr (b) Financial assistance. 11,987,560: --; 27.576,000: --, -27,576,000: * * * * * * Subtotal, PL-566........... 19,421,389: 49: 40, f 18,000: 84: -40,118,000: gºº tº ºf Total Direct Obligations... 22,513,068: 61: 54,237,362: 97: -54,237,362: gº tº sº sº Unobligated balance : : : * : : brought forward............ (-34,460,006) -- (-84,937,453) --: (+24,237,362)(-60,700,091) -- Prior Year Recoveries ...... (-11,191,970) --. ~~ * -- --" --" sus ºr Offsetting Collections...... (-11,130,585) --. gº wing tº gº; ~~. ~~ * tº dº Reimbursements............... (+4,583,515) -- tº ge as ºf ~~! --. * ºn Chg in Customer Payments (–30,962,475) ---. --. «-4-> --. --. tº vº Not Available Carried Fwd --: --- (+60,700,091) -- :(+60,700,091) Unobligated balance : : : : : carried forward............. {+84.937,453) --. •- --. --. --. *º sº. Adjusted Appropriation.... (24,289,000) -- (30,000,000) -- (-30,000,000) •,•. sº Reimbursable obligations: : * : - : 1. Watershed Operations Authorized by PL-534: (a) Technical assistance. --. tº º tºº, ~~. tº tº mºs tº gº (b) Financial assistance. -133,448: -- tº ºf tº mº * * m wº <º tº Subtotal, PL-534.......... -133,448: -- tº wº tº º tº tº gº tº sº 2. Small Watersheds . s Authorized by PL-566: : . : : : (a) Technical assistance. 3,062,131: 26: 3,200,000: 26: –3,200,000: tº º ºf ºi (b) Financial assistance. 1,654,832,; gº º 1,800,000: * -º -1,800,000: --. * * * Subtotal, PL-566........... 4,716,963: 26: 5,000,000: 26: –5,000,000; ~~. ºntº Total Reimb. Obligations. 4,583,515; 26: 5,000,000: 26: -5,000,000: * * bºº Obligational authority...... 27,026,583, 87–59,237,362; 1235–39,237,362. *** * ** 218 2009 Actual : : Staff: Program. Amount: Years: Amount Watershed & Flood Prevention — Suppleme 1. Emergency Watershed : Protection Operations: (a) Technical assistance. $37,933,508: 240: $84,404,000: 586: -$84,404,000: --: 247,999.000: --: -247.999,000: (b) Financial assistance. 205,320,282: 25-31 2010 Estimated : : Staff: :Years: ntal Appropriation: Increase Or Decrease : 2011 Estimated : Staff Amount : Years Subtotal, EWP.............. 243,253,790: 240: 332,403,000: 586: -332,403,000: -* * * Unobligated balance : : : : : brought forward............ (-529,364,457) --:(-332,403,000) --: (+332,403,000) - - Prior Year Recoveries...... (-43,178,808) --: -- " -- --" - - - - Offsetting Collections...... (-2,692,462) -- ** ** --. - * ** Reimbursements............... (+1,127,729) -- -- -- --, * * * * Chg in Customer Payments (-1,548,792) -- ** wº -*. * * * *- Not Available Carried Fwd. ---. -- - ** ** wº-wºº waiº Unobligated balance . . carried forward............. (+332,403,000) -- ---, & ºw ~~" “ Adjusted Appropriation.... •- -- *** * --- -- --. -- Reimbursable obligations: * 1. Emergency Watershed Protection Operations: : : : : (a) Technical assistance. 214,668: -- 3,922,170: 4: –3,922,170: * * * * (b) Financial assistance. 913,061: --- 16,720,830; --, -16,720,830: * * * * * Subtotal, EWP.............. 1.127,729: --: 20,643,000: 4: -20,643,000: ** * * 2. EPA Great Lakes : re : º: Restoration Initiative: - : : : (a) Technical assistance. -- ~-. 871,400: 3: –871,400: * * * * * (b) Financial assistance. --: --: 3,485,600: --: –3,485,600; * * **: Subtotal, EPA............... --, --, 4,357,000: 3: -4357,000: --s -- Total Reimb. Obligations. --: --. 25,000,000: 7: -25,000,000: --> -- Obligational authority ...... 244,381,519, 240; 357,403,000: 593: -357,403,000; —t-i-º- Justification of Increases and Decreases (1) A net decrease of $30,000,000 for the Watershed and Flood Prevention Operation Program ($30,000,000 available in 2010): a) A decrease of $5,146,000 for Watershed Operations Authorized by PL-534 ($5,146,000 available in 2010): The fiscal year 2011 budget proposes to terminate funding for this program. Congress has earmarked this program in recent years, therefore the Agency is limited in its ability to prioritize projects on merit-based criteria. Since most program benefits are highly localized, the Agency anticipates that those PL-534 projects not yet completed will continue to receive local support from project sponsors. 219 25–32 2010): from project sponsors. tatus of PL-534 watershed projects: The fiscal year 2011 budget proposes to terminate funding for this program. Congress has earmarked this program in recent years, therefore the Agency is limited in its ability to prioritize projects on merit-based criteria. Since most program benefits are highly localized, the Agency anticipates that those PL-566 projects not yet completed will continue to receive local support b) A decrease of $24,854,000 for Small Watersheds Authorized by PL-566 ($24,854,000 available in Status of Operational Projects 2009 2010 2011 Active sub-watersheds... 71 70 * * Projects continuing post-installation assistance....... 206 207 Aº º Total operational sub-watersheds......................... 277 277 -- Inactive projects 9i 91 * -º- De-authorized projects. 25 25 -- otal sub-watersheds 393 393 es ºvº Status of PL-566 watershed projects: Status of Operational Projects 2009 2010 2011 Land treatment projects 94. 83 ** Structural projects 143 125 * * Land treatment and structural 60 52 ** Subtotal active projects 297 260 * * Projects in post-installation assistance..................... 1,063 1,084 * ºw Inactive Projects 190 200 * * Project Life Completed 42 50 ** De-authorized projects 158 158 **e Total operational projects 1,750 1,752 * * New projects approved during year.......................... 6 2 -- Geographic Breakdown of Obligations and Staff Years 2009 Actual and Estimated 2010 and 2011 2009 2010 2011 Staff Staff Staff Amount Years Amount Years Amount Years Alabama............................... $8,717,673 8 $3,144,665 3 - - ** Alaska 815,679 3 7,747,183 12 * º ſº wº Arizona 33,941 * * 4,359,000 ** *sº -- Arkansas............................... 6,359,827 8 4,203,343 15 -** -- California............................. 13,836,605 13 6,412,885 3 ** ** Colorado............................... 12,900 -- 64,030 tº sº. ** -- Connecticut.......................... 84,895 1 2,852,039 5 ** -- Delaware.............................. * -º --- ** mº :- 4- tº ºw Florida - 29,885,190 14 11,432,800 8 ** www. Georgia 542,997 * * 2,351,200 tº º * * * * Hawaii 3,744,839 4 8,834,877 24 * * -- 220 25–33 2009 2010 Staff Staff Amount Years Amount Years Idaho •y 3 -- ** 4&tº Illinois.... - 1,532,598 2 1,202,000 } Indiana...... - * 9,582,013 7 867,048 1. Iowa. r 28,061,804 20 54,805,425 42 Kansas.................................. 1,105,693 3 632,238 H Kentucky.............................. 13,454,850 18 8,414,778 15 Louisiana.............................. 28,200,734 19 5,457,301 4 Maine 199,075 -- 30,588 mºsº Maryland.............................. 61,608 ** wara- ** Massachusetts 1,031,223 - * *wº **g, Michigan.............................. 478,244 l 145,648 sº wº Minnesota............................. 847,399 2 492,800 * * Mississippi........................... 12,371,158 37 9,365,033 22 Missouri 43,135,824 55 39,347,664 77 Montana............................... * - * * 200,000 tº nº Nebraska............................. * * 1,246,153 1 tº tº * * Nevada As-- -- - me sº New Hampshire.................... 116,419 --- 76,469 , -- New Jersey........................... 7,665 -- mº º wºstºy New Mexico......................... 7,224,688 9 86,000 1 New York..................... 977,584 i 7,673,828 16 North Carolina 1,066,788 3 2,427,039 1. North Dakota 1,124,966 i 1,124,155 { Ohio w 993,063 i 150,200 1 Oklahoma..................... 12,074,106 13 3,122,424 #5 Oregon 4.17,682 wavº ** **** Pennsylvania 1,067,498 3 672,045 1. Puerto Rico................... * * ** -- ** Rhode Island................. 141,435 4-rºw 2,000,000 2 South Carolina 659,333 2 701,086 2 South Dakota 2,227 -- 2,352,039 ** Tennessee..................... 2,760,874 5 4,128,908 6 Texas 17,117,412 22 15,094,702 50 Utah 4,125,733 6 34,191,062 34 tº ºn essºr Vermont 56,717 - - 2,015,579 gºº *g ºf -- Virginia 280,120 f 159,217 i ** -- Washington.................. 74,390 ! 20,000 * * ºtes --- West Virginia 6,046,649 i2 15,847,642 9 tº ºf lº-- Wisconsin..................... 2,620,972 f 2,516,362 **** ºstºn * * Wyoming... - 555,081 2 85,874 * * ** ** National Haqtr...................... 408,470 2 605,105 3 sº tº ** National Centers................... 4,061 --- - - * * ** - *- Nat. Tech. Sup. Cent. ........... 500,000 ** -- -- * * **** Undistributed........................ tº- **s | 19,228,081 307 º --- Total Obligations/Est............ 265,766,858 30} 386,640,362 683 gº tº ** 221 25-34 NATURAL RESOURCES CONSERVATION SERVICE Watershed and Flood Prevention Operations Classification by Objects 2009 Actual and Estimated 2010 and 2011 Personnel Compensation: 2009 2010 Washington, D.C. $287,926 $311,480 Field … 21,731,258 30,836,882 11 Total personnel compensation........ 22,019, 184 31,148,362 12 Personnel benefits........................... 6,019,171 8,586,000 13 Benefits for former personnel......... -- * - Total pers. comp. & benefits........... 28,038,355 39,734,362 Other Objects: - 21 Travel.............................................. 1,328,125 1,847,000 22 Transportation of things.................. 7,060 11,000 23.1 Rent payments to GSA.................... - tº- * - 23.2 Rental payments to others............... 1,145,344 1,145,000 23.3 Communications, utilities, and misc. charges................................... * --> ºf ºº 24 Printing and reproduction................ - sº tº wº 25.1 Advisory and assistance services.... 51,706,621 *- 25.2 Other services. 16,349,490 20,458,000 25.2 Construction contracts.................... 630,530 83,258,000 26 Supplies and materials.................... 756,739 1,046,000 31 Equipment....................................... 1,620,203 2,225,000 32 Land and structures......................... 20,890,932 28,477,000 41 Grants • * * > is a s : * * * * * * * * * * * * * * * * * * * * * * * 143,269,680 208,403,000 42 Insurance and loans......................... 8,000 14,000 43 Interest and dividends..................... 15,779 22,000 44 Refunds..................................... … - * ** Total other objects........................... 237,728,503 346,906,000 Total, direct obligations................................. _265,766,858 386,640,362 2 } 222 25-35 NATURAL RESOURCES CONSERVATION SERVICE Watershed and Flood Prevention Operations SUMMARY OF RECOVERY ACT FUNDING Program 2009 2010 2011 Watershed and Flood Prevention Operations.............. $145,000,000 sº gº ºn Watershed Floodplain Easements ............................... 145,000,000 ** wºº Total Available................ ... 290,000,000 sº tº E Project Statement - Recovery Act (On basis of available funds) 2009 Actual : 2010 Estimated : Increase : 2011 Estimated : Staff: - : Staff: Ör : : Staff Program. Amount Years. Amount Years: Decrease : Amount Years 1. Watershed & Flood Prevention Recovery Technical Assistance.... $5,109,366: 34: $24,876,096: 199: -$24,876,096. Financial Assistance..... 34,949,777: -- 80,064,761; --: -80,064,761: Total Direct Obligations... 40,059,143: 34: 104,940,857: 199: -104,940,857: Unobligated balance & e º e º brought forward.............. --. -- (-104,940,857) --(+104,940,857) ** fºr ºt Prior Year Recoveries...... --> --. -- ~~. --. --. -- Unobligated balance : : : : : carried forward............(+104,940,857): --. --, --, ---. ~~. -- Adjusted Appropriation... (145,000,000): --. --> --. -*. as ºs was sº Reimbursable Oblig.......... --> --> -- ~~. --. *ºrº ºf E* Obligational Authority..... 40,059.143: 34: 104,940.857: 199: -104,940,857; sº sº º 2. Watershed Floodplain Easements Recovery Technical Assistance.... $5,093,694; 33: $23,906,306: 198: -$23,906,306; †--> sº wº Financial Assistance..... 74,729,231: --: 41,270,769: --: -41,270,769: * - sº tº Total Direct Obligations... 79,822,925: 33: 65,177,075: 198: -65,177,075: gº º ** Unobligated balance : . : : - : brought forward.............. --, --, (-65,177,075) --: (+65,177,075) --, -- Prior Year Recoveries ...... -- ~~. --, --, --. -- ~~ Unobligated balance : : : : . . carried forward..............(+65,177,075): --. - --> --. **: * * * * Adjusted Appropriation (145,000,000): --. --, --, --. -- " -- Reimbursable Oblig.......... --> -- -- ~~. --. * =gº ºº Obligational Authority..... 79,822,925; 33: 65,177.075: 198: -65,177,075: tº at ººl Total Direct Obligations... 119,882,068; 67: 170,117,932: 397; -170,117,932; Program Implementation Activities; Goals and Coordination Efforts: This voluntary program provides assistance to sponsoring local organizations of authorized watershed projects, planned and approved under the authority of the Watershed Protection and Flood Prevention Act of 1954 (P.L. 83-566), and designated watersheds authorized by the Flood Control Act of 1944 (P.L. 78- 534) (referred to as “Watershed and Flood Prevention Operations (WFPO).”) NRCS provides technical and financial assistance to States, local governments and Tribes (as project sponsors) to implement authorized watershed project plans for the purpose of watershed protection; flood mitigation; water quality 223 25-36 improvements; soil erosion reduction; rural, municipal and industrial water supply; irrigation water management; sediment control; fish and wildlife enhancement; and wetlands and wetland function creation and restoration. There are over 1,500 active or completed watershed projects. Floodplain easements restore, protect, maintain, and enhance the functions of the floodplain; conserve natural values including fish and wildlife habitat, water quality, flood water retention, ground water recharge, and open space; reduce long-term Federal disaster assistance; and safeguard lives and property from floods, drought, and the products of erosion. Landowners retain several rights to the property, including quiet enjoyment, the right to control public access, and the right to undeveloped recreational use such as hunting and fishing. Objectives: The objective of The American Recovery Reinvestment Act (ARRA), WFPO funds is to provide watershed project sponsors with financial and technical support that will allow completion of mitigation obligations or structural repairs, or that involve land treatment projects. ARRA funds will also be used for new construction projects that are already authorized for construction, are environmentally beneficial, and that are owned or operated by sponsors that are ready and able to begin work. For floodplain easements, the objective is to enroll floodplain lands that will link or extend other floodplain or riparian conservation easements or protected areas, provide benefits to Federal or State listed threatened and end...gered species, result in flood damage reduction, and are not likely to involve environmental or legal complications. Delivery Schedule: WFPO milestones: } USDA approval of funding recommendations: April 2009 2 Allocation of funds to NRCS State Offices: April 2009 3 Total obligation of all WFPO funds: September 2010 Floodplain easement milestones: • Application period closes: May 2009 Projects ranked: April 2009 Offers to purchase easements made: July 2009 Easements recorded and closed: February 2010 Easement restoration funds obligated: September 2010 • Easement restoration completed: December 2010 Performance Measures: : Performance Target 2009 2010 2011 Watershed and Flood Prevention Operations Number of jobs created or saved 900 2,317 tº dº Flood prevention or mitigation measures installed, number ---> 17 149 Watershed Floodplain Easements - - Number of jobs created or saved 942 1,216 * * EWP floodplain easements closed, acres ºrsº 35,000 tº º Note: Jobs created or saved were developed by using IMPLAN, designed by the USDA Forest Service, Federal Emergency Management Agency, and USDI Bureau of Land Management, 224 25-37 Geographic Breakdown of Obligations and Staff Years 2009 Actual and Estimated 2010 and 2011 Vermont............................... 3,209 tºº ** 2009 2010 2011 - Staff Staff Staff - Amount Years Amount Years Amount Years Alabama - $1,657,082 1 $2,498,292 6 ** -s tº Alaska 155,739 1 1,238,230 2 --> - ºr Arizona .. * * -- ** ** ºw ºw tº º Arkansas --- 1,443,693 1 928,307 4 ** ºf tº California ................ * * * * * * * * * * * * * 6,630,966 } 18,010,434 19 --> * Gº Colorado 1,978,947 3 1,873,241 5 tº- ſº tº Connecticut.......................... 31,001 tº ºs -- --> -º- ** Delaware.............................. sº º * * *...tº x-º ºr -- * = Florida 3,351 -*** -- wawa sººs. -** Georgia wn w w we 2,453,255 *xºs 646,963 5 * * -º- Hawaii 109,074 1 4,041,262 11 -- **E* Idaho.... r = . 25,750 agº. 420,127 ! --> ** Illinois - 2,912,944 2 3,765,944 8 **** º ºgº Indiana 6,730,048 3 5,212,645 16 * * * * , Iowa..., 13,510,578 3 8,411,980 23 wºº wºme Kansas.................. '............... 1,740,470 1 2,293,962 6 cºvº. * * Kentucky.............................. 2,844,718 ! 5,344,492 13 --- * - Louisiana * 2,589,872 3 3,624,297 5 *- sº ºs Maine * 59,227 * * 589,596 1 twº-ºº: ** Maryland.............................. 19,862 -r- --- sºme - ºr ** Massachusetts....................... 3,075 tº ºr -- -º ** ** Michigan.............................. 437,970 i 59,130 1 * * wºº Minnesota 1,484,309 3 349,734 i -- º, tº Mississippi........................... 5,973,997 . 4 3,994,189 15 --> mºtº Missouri 4,091,121 2 3,646,127 23 -494 sº as Montana 596,518 1 242,800 H - * ** Nebraska 1,826,138 I 2,733,682 | 1 M-6- ** Nevada v e º e º 4 w 1,035 --> ** ** -- wº New Hampshire.................... 351,813 - sº 59,809 f ** ºpwº New Jersey........................... 631,989 - ºr 113,175 } * * tºº? New Mexico......................... 28,877 gºes 1,411,123 2 **e sº tº New York............................. 217,212 2 825,649 9 wº gº ºne North Carolina...................... 465,860 2 5,258,398 8 -wº * ºn North Dakota........................ 5,762,165 f 2,277,878 l --- ºsºe Ohio - 1,245,173 4 5,351,924 6 lºº wºº Oklahoma............................. 1,886,245 f 4,644,375 13 wºº - EP Oregon............ 1,201,535 -º-º: 1,074,235 3 wº-ºº tº a Pennsylvania........................ 10,616,310 2 1,754,073 9 wº tº Eº Puerto Rico........................... 7,017 •eºs -- ** tº-wº *** Rhode Island......................... 538,444 tº tºs 2,710,856 5 . tº lºa tº gº South Carolina...................... 107,539 2 1,019,133 2 º -sº South Dakota........................ 1,575,859 ºrº - 267,468 3 ** tº º Tennessee............................. 3,407,273 3 10,581,881 22 -A- aº tº Texas 8,530,189 3 13,261,438 29 ** wº Utah 2,104 º ºf * * -* ** tº wº 225 25–38 2009 2010 2011 - Staff Staff Staff Amount Years Amount Years Amount Years Virginia..... 382,826 1 625,928 5 ** ** Washington.......................... 1,350,129 l 740,023 3 hºw wºw * * West Virginia....................... 669,859 4 10,164,567 24 -- - º Wisconsin....................* * * * * * * * * * 19,793,015 6 4,332,856 18 * - sº tº Wyoming * * * * * - *- gº ºf *** *sº **- wºº National Haqtr...................... 1,659,414 1 2,061,323 11 agºsº * * National Centers................... 137,272 1 396,791 4 “ºptº ºº: Nat. Tech. Sup, Cent. ........... ** -- -- - tº sº- sº sº Jndistributed........................ -- ºs- 31,259,595 41 tºº- -º-º: 67 170,117,932 397 226 25g-25 NATURAL RESOURCES CONSERVATION SERVICE WATERSHED AND FLOOD PREVENTION OPERATIONS STATUS OF PROGRAM Current Activities - y Background. Flood Prevention Authorized by Public Law 534. The Flood Control Act of 1944 authorizes the Secretary of Agriculture to install watershed improvement measures to reduce flood, sedimentation, and erosion damages; further the conservation, development, utilization, and disposal of water; and further the conservation and proper utilization of land. Flood prevention work is authorized in the 11 watersheds designated in the Flood Control Act of December 22, 1944. Detailed sub-watershed work plans are prepared for P.L.-534 flood prevention projects in cooperation with soil conservation districts and other local sponsoring organizations. These plans outline soil and water management problems in sub-watersheds, proposals to alleviate these problems, the estimated benefits and costs, cost sharing, and operation and maintenance arrangements. Watershed Operations Authorized by Public Law 566. The Watershed Protection and Flood Preventio Act of 1954 provides for cooperation between the Federal government and the States and their political subdivisions in a program to prevent erosion, floodwater, and sediment damage; to further the conservation development, utilization, and disposal of water; and to further the conservation and proper utilization of land in authorized watersheds. NRCS has the responsibility for administration of the Watershed Protection and Flood Prevention Act and the work authorized under the Flood Control Act. This includes responsibility for administering the installation of land treatment measures and works of improvement in authorized watersheds on Federal and non-Federal land by arrangement with the administering agency. Program Similarities. The P.L.-534 and P.L.-566 program authorities have similar objectives. The planning criteria, economic justifications, local sponsorship requirements, cost-sharing criteria, structural limitations, and other policies and procedures of the two programs generally parallel each other. Program Technical and Financial Assistance. Watershed improvement measures are installed through: 1. Land treatment measures. NRCS assures that a program of proper land use and treatment will be carried out as a basic requirement for assistance in the development of flood prevention sub-watersheds or watershed projects. NRCS provides landowners and operators with technical assistance to accelerate the planning and application of land treatment measures that help achieve project objectives. This accelerated assistance is in addition to that received under other conservation programs. Installation costs may be shared with Federal funds when land treatment measures are installed primarily to achieve environmental and public benefits, such as surface and ground water quality improvement, water conservation, and flood mitigation. The cost-share rate of this financial assistance may not exceed the rate of assistance for similar practices under other conservation programs of USDA. This work is accomplished through project agreements with local sponsoring organizations or through long-term contracts between the landowner and NRCS. In the first case, the local sponsors arrange for and accomplish the work by contract or force account. NRCS makes payments to the local sponsoring organizations as the land treatment measures are installed. In the long-term contract situation, landowners contract directly with NRCS, 2. Basements and construction activities. In addition to land treatment, these projects may involve a wide variety of other works of improvement: floodwater retarding dams, flood-proofing of buildings located in a floodplain, floodplain easements; water supply and water conservation; stream channel restoration; grade stabilization and sediment control; fish and wildlife habitat; water-based recreation, and other similar measures. Detailed construction plans, designs, and specifications are prepared for these measures by NRCS or by the private sector, and by the local sponsoring organization. 227 - 25g-26 NRCS provides all construction funds for flood mitigation and an equitable share of the cost of installing works of improvement for agricultural water management, fish and wildlife, water quality, or recreational development. The latter includes the cost of basic facilities for public health and safety, access to recreational areas, and use of the recreational development. Local organizations must pay all costs of works of improvement for other purposes. In addition, local organizations must acquire water right permits and furnish land, easements, and rights-of-way for all structural measures. However, up to one-half the cost of land, easements, and rights-of-way allocated to public fish and wildlife and recreational developments may be paid with P.L.-534 or P.L.-566 funds. Financial assistance may also be provided for the purchase of conservation easements at a Federal cost share rate of 50 percent to 99 percent. 3. Technical assistance. Technical assistance is provided for flood mitigation, agricultural water management, water quality, and for water resource development or improvement for public fish and wildlife and recreational purposes, either directly by NRCS, or by the local organizations with advances or reimbursement from the Federal government. NRCS may also supply up to one-half the cost of engineering assistance required for the installation of basic facilities for public fish and wildlife and recreational development. Conservation measures can be installed using a variety of contracting methods. Contracts may be administered by NRCS using formal contracting procedures or by the sponsoring local organizations. Local sponsoring organizations must operate and maintain the completed works of improvement on non-Federal lands for the length of time that the project is economically evaluated. This eriod of time is usually between 25 and 100 years. rogram Benefits. Flood prevention and other annual benefits to the environment and communities from . .L.-566 and P.L.-534 that occurred in FY 2009 are shown below. Benefits Agricultural Benefits (not related to flood control): $404 million. Benefits associated with erosion control, animal waste management, water conservation, water quality improvement, irrigation efficiency, change in land use, etc. - - Non-Agricultural Benefits (not related to flood control): $877 million. Benefits associated with recreation, fish and wildlife, rural water supply, water quality, municipal and industrial water supply, and incidental recreation uses, etc. - - Agricultural Flood Protection Benefits: $320 million. This value includes all crop and pasture damage reduction benefits as well as all other agricultural damage reduction benefits. Non-Agricultural Flood Protection Benefits: $425 million. Non-agricultural flood damage prevented to roads, bridges, homes, and other structures that exist in the floodplain. Benefits to Natural Resources - Acres of nutrient management: 671,483 Tons of animal waste properly disposed: 4,722,731 Tons of soil saved from erosion: 89,892,119 Miles of streams and corridors enhanced, or protected: 47,374 Acres of lakes and reservoirs enhanced, or protected: 2,511,522 Acre-feet of water conserved: 1,842,102 - Acres of wetlands created, enhanced, or restored: 278,939 Acres of upland wildlife habitat created, enhanced, or restored: 9,142,277 ocial and Community Benefits Number of people: 48,273,800 Number of farms and ranches: 180,998 Number of bridges: 61,639 - Number of public facilities: 3,650 Number of businesses: 46,583 Number of homes: 608,578 Number of domestic water supplies: 27,833 O 228 25g-27 Status of Flood Prevention Projects Authorized by P.L.-534. Because the authorized flood prevention projects include relatively large areas, work plans were developed on a sub-watershed basis. As of September 30, 2009, the total planning job was about 94 percent completed, with 397 work plans completed that include approximately 30 million acres. The following table summarizes the status of sub- watershed planning by authorized project: Total Sub-watersheds and Work plans & º authorized other areas with developed through Flood Prevention Projects &lre? planning potential 9/30/09 Acres No. Acres No. Acres Buffalo Creek, NY " 279,680 3 279,680 3 279,680 Colorado (Middle),TX 4,613,120 17 3,703,520 17 3,703,520 Coosa, GA,TN * 1,339,400 16 1,174,650 16 1,174,650 Little Sioux, LA 1,740,800 124 1,050,093 121 1,033,578 Little Tallahatchie, MS 963,977 18 625,274 * 18 625,274 Los Angeles, CA* 536,960 10 127,627 & 10 127,627 Potomac, MD,PA,VA,WV 4,205,400 31 4,205,400 30 3,094,543 Santa Ynez, CA 576,000 5 50,743 * 5 50,743 Trinity, TX 10,769,266 36 10,769,266 36 10,769,266 Washita, OK, TX 5,184,362 57 5,184,362 57 5,184,362 Yazoo, MS 7,661,278 104 3,955,124 84 3,955,124 TOTAL 37,870,243 421 31,125,739 397 29,998,367 aſ The Buffalo Creek Watershed was completed and closed in 1964 and reopened in 1992 for repairs The Coosa Watershed was completed and closed in 1981. The Los Angeles Watershed is completed, - b/ Excludes 96,501 acres of Sardis Reservoir area, and 304,000 acres in minor watersheds needing only land treatment measures. . .” c/ Includes National forest and other lands, for which the Forest Service has been assigned program responsibility. d/ Excludes 195,818 acres of reservoir area. The estimated Federal cost for each watershed and total Federal obligations through FY 2009. tº & Estimated Total Obligations Fiocci Prevention Project Federal Cost (cumulative $). Buffalo Creek Watershed, NY (Complete) $7,827,746 $6,287,347 Middle Colorado River Watershed, TX 71,111,062 63,062,555 Coosa River Watershed, GA and TN (Complete) 18,999,247 18,264,485 Little Sioux River Watershed, LA 98,581,921 93,538,419 Little Tallahatchie River Watershed, MS 69,501,448 76,322,835 Los Angeles River Watershed, CA 60,597,017 60,297,017 Potomac River Watershed, MD, PA, VA, and WV 150,217,206 145,384,300 Santa Ynez River Watershed, CA 41,386,536 40,786,536 Trinity River Watershed, TX 331,241,632 211,165,950 Washita River Watershed, OK and TX 202,491,055 192,720,603 Yazoo River Watershed, MS 252,957,352 251,468,563 TOTAL $1,304,912,222 $1,159,298,610 Status of Watershed Projects Authorized by P.L.-566. Watershed Project Plans are prepared by local sponsoring organizations with assistance from NRCS. The plans are submitted to NRCS with requests for Federal funding authorization. Watershed projects involving an estimated Federal contribution in excess o five million dollars for construction, or construction of any single structure having a capacity in excess of 2,500 acre-feet of water storage require authorization by Congressional Committee, Watershed projects ar 229 25g-28 limited to 250,000 acres and cannot include any single structure which provides more than 12,500 acre-feet of floodwater detention capacity, or more than 25,000 acre-feet of total capacity. The Chief of NRCS authorizes the use of Watershed Operations funds for all other projects. - fter authorization, technical and financial assistance may be provided to local sponsoring organizations or installation of works of improvement specified in the plans. - FY 2009 P.L.-566 Watersheds Project Status 1750 297 158 190 42 Authorized Completed * Deauthorized inactive Project Life Total - Over ew P.L.-566 Watershed Projects Authorized For Funding. Six new projects were authorized for ding under the Watershed Protection and Flood Prevention Act (P.L. 83-566) in Fiscal Year 2009. FEDERAL LOCAL TOTAL NAME COST COST COST olorado Beaver Creek Watershed $3,603,900 $4,654,300 $8,258,200 Southern Washington County 4,919,400 9,409,000 14,328,400 Water Quality Project ouisiana Red Bayou Watershed 2,725,450 1,521,150 4,246,600 outh Carolina South Darlington Watershed 638,735 409,650 1,048,385 tº North Fork Powell Watershed 1,242,000 558,000 1,800,000 yoming Kaycee Flood Prevention Project 850,800 105,500 956,300 $13,980,285 $16,657,600 $30,637,885 Unfunded Federal Commitments (Total Backlog of Projects). The backlog is the unfunded Federal :ommitment or funding needed to install the remaining measures in the existing 297 active watershed rojects. The current backlog is $1.25 billion. When installed, these floodwater dams, reservoirs, and 5ther conservation practices will reduce flood damages in 320 communities, provide agricultural water ſupply in 80 communities, improve water quality in 132 stream segments, install water conservation measures in 25 projects, and enhance, restore or create wildlife habitat in 45 projects. In addition to the |. request for FY 2010 funds, the following summary indicates the Federal funds necessary to :omplete all remaining measures: Unfunded Federal Commitment to Authorized Watershed Projects State P.L. 566 ($) P.L. 534 ($) Total ($) Alabama $15,424,000 $15,424,000 Alaska 9,351,600 9,351,600 Arizona 9,414,421 9,414,421 Arkansas 87,260,454 - 87,260,454 California 43,718,000 43,718,000 Colorado 3,860,130 3,860,130 230 25g-29 Unfunded Federal Commitment to Authorized Watershed Projects State P.L. 566 ($) P.L. 534 ($) Total ($) Connecticut 4,526,200 4,526,200 Florida 1,238,720 1,238,720 Georgia 5,209,772 5,209,772 Hawaii 34,058,300 34,058,300 Idaho 12,586,255 12,586,255 Indiana 7,179,000 7,179,000 Iowa 46,229,900 9,000,004 55,229,904 Kansas 59,915,000 - 59,915,000 Kentucky 6,120,160 6,120,160 Louisiana 5,775,000 5,775,000 Maine 50,000 50,000 Maryland 450,000 450,000 Minnesota 1,347,524 1,347,524 Mississippi 14,585,500 45,664,100 60,249,600 Missouri 63,509,000 63,509,000 Montana 7,362,500 7,362,500 Nebraska 5,472,300 5,472,300 New Mexico 57,597,000 57,597,000 New York 12,587,557 12,587,557 North Carolina 22,303,280 22,303,280 North Dakota 14,430,300 14,430,300 Ohio 15,790,000 15,790,000 Oklahoma 251,600,800 19,678,800 271,279,600 Oregon 3,929,796 3,929,796 Pennsylvania 8,135,000 8,135,000 South Carolina 13,000 13,000 Tennessee 29,480,477 29,480,477 Texas 105,854,000 139,200,000 245,054,000 Utah 390,860 390,860 Vermont 186 186 Virginia 9,552,146 9,552,146 West Virginia 22,779,000 26,089,563 48,868,563 Wyoming 5,436,955 5,436,955 Pacific Basin 6,313,000 6,313,000 Total $1,010,837,093 $239,632,467 $1,250,469,560 Loan Programs Under P.L.-534 and P.L.-566. Both programs provide for loans and loan services to finance the local share of the costs of installing, repairing, or enhancing works of improvement and water storage facilities, purchasing sites or rights-of-way, and for related costs in approved watershe and flood prevention projects. Repayment with interest is required within 50 years after the principa benefits of improvements first become available. The interest rate is not to exceed the current yield for outstanding municipal obligations with remaining periods to maturity on obligations of similar maturity. For a single plan for works of improvement, the amount of the loan may not excee ten million dollars. Loans are financed through the Rural Utilities Service. 231 25g-30 There are currently 58 borrowers who are holding loans with an unpaid principal amount of $13.7 million. Over the life of the program, 495 loans have been made at a value of almost $176 million. Congress did not appropriate funds in FY 2009 to provide new loans under this program. Selected Examples of Recent Progress - Hawaii: Lower Hamakua Ditch Watershed. The Lower Hamakua Ditch Watershed Project is located in the Hamakua coast area of the Island of Hawaii. Authorized in 1999, the project is sponsored by the State of Hawaii Department of Agriculture, the Mauna Kea Soil and Water Conservation District, and the Hamakua Soil and Water Conservation District. This project will increase the availability and reliability of agricultural water to diversified farmers and ranchers along the Hamakua coast through the repair and restoration of the Lower Hamakua Ditch. The 25-mile Lower Hamakua Ditch was completed in 1910 and was used and maintained by the sugar industry until the bankruptcy closing of the Hamakua Sugar Company in 1994, - Since 2001, design and construction have resulted in the installation of two water storage reservoirs, two pipeline distribution laterals, repair or replacement of 31 flume structures, modification of 3 intake structures, realignment of the Hakalaoa Falls Tunnel, and reconstruction of 2 historic redwood flumes. Remaining construction elements include the repair of ditch linings, exclusion fencing, a Supervisory Control and Data Acquisition (SCADA) system, eight distribution lateral systems, and on-farm land treatment practices. Full project completion is anticipated in 2017. This project will help to expand the diversified agricultural base in Hamakua and to promote economic revitalization of the Hamakua coast. Kentucky: Pigeon Roost Watershed. Kentucky NRCS in cooperation with the local sponsors (City of McKee, the Jackson County Fiscal Court, and the Jackson County Conservation District) recently completed construction of the Pigeon Roost Flood Retarding Structure No. 3 (FRS 3) in Jackson County, Kentucky. Pigeon Roost FRS 3 is the 200th floodwater retarding structure built in Kentucky under the PL- 566 and the Pilot Watershed Programs. FRS 3 is also the fourth flood protection structure built in the Pigeon Roost Watershed that reduces flooding of residential and businesses properties in the City of McKee, Kentucky. This watershed structure provides over $167,000 of annual agricultural flood damage reduction benefits, over $685,000 of annual non-agricultural flood damage reduction benefits, and provides floodwater protection to over 850 residents of the City of McKee. Texas: Elm Creek (Cen-Tex) Watershed (Site 34). Elm Creek (Cen-Tex.) Watershed was authorized in 1975 and comprises an area of 324 square miles in the Brazos River Basin in Central Texas. The watershed drains portions of McLennan, Bell, Falls, and Milam Counties. Thirty-four of the forty-three floodwater retarding structures that were planned have been constructed. Site 34, completed on June 18, 2009, has a drainage area of 8,115 acres and a construction cost of $2.9 million. There are seven sponsoring local organizations of the overall Elm Creek Watershed project; however the primary sponsors of Site 34 are Elm Creek Watershed Authority, Central Texas Soil and Water Conservation District and Milam County. The primary purposes of Site 34 are reduction in downstream flood damages and reduced damages caused by sediment. Site 34 provides over $155,000 in average annual benefits, which includes benefits to seven bridges and 120 farms. Site 34 also reduces annual sedimentation by 19,400 tons, and provides enhancement/protection to eight miles of streams, 72 acres of wetlands and 5,200 acres of upland habitat. Wyoming: Allison Draw Flood Control Project. Average annual benefits of $359,600 are being realized on the Allison Draw Flood Protection Project located in Wyoming's southeast corner, near Cheyenne. Allison Draw is not a perennial stream and is a small watershed of 11,500 acres fed by groundwater in the lower section. Years ago, since the drainage does not have water year around, developers constructed housing and provided business locations. Eventually, the shift in land use closed the stream channel. While normally the stream is dry, a significant rain storm would place up to 289 homes and businesses at risk of flood damage. In 1993, the Plan/Environmental Impact Statement was developed, and the final phase of the project was completed in 2009. 232 25g-31 A three mile flood channel was constructed to contain the 25 year level storm. Adjustments were made to the alignment of the channel to mitigate moving many buildings that were originally planned for removal. The project includes a greenway, walking paths, rest benches, and three playground areas. Three highway road crossings were completed by the Wyoming Highway Department. The costs of flood damage have been reduced dramatically and this economically depressed area is now recovering with new residences and businesses being constructed. The community college, which is located in the project area, is seeing strong enrollment. 233 25g-32 NATURAL RESOURCES CONSERVATION SERVICE EMERGENCY WATERSHED PROTECTION PROGRAM STATUS OF PROGRAM Current Activities Background. Congress established the Emergency Watershed Protection (EWP) Program to respond to emergencies created by natural disasters. The EWP Program, an emergency recovery program, relieves imminent hazards to life and property caused by floods, fires, windstorms, and other natural occurrences. All projects undertaken, with the exception of the purchase of floodplain easements, must be sponsored by a legal subdivision of the State. This includes any city, county, general improvement district, conservation district, Native American Tribe, or Tribal organization as defined in section 4 of the Indian Self- Determination and Education Assistance Act. NRCS is responsible for administering the program. EWP Program funds have restrictions. The EWP Program cannot solve problems that existed before the disaster or improve the level of protection beyond what existed prior to the disaster. It cannot fund operation and maintenance work, or repair private or public transportation facilities or utilities. The work cannot adversely affect downstream water rights, and funds cannot be used to install measures not essential to the reduction of hazards. Funds cannot be used to perform work on measures installed by another Federal agency. EWP Recovery Program Administration. All EWP Program work must reduce threats to life and property, and mus' ºe economically, environmentally, and socially defensible, and technically sound. NRCS may bear up to 75 percent (90 percent within limited resource areas as identified by the U.S. Census data) of the construction cost of emergency measures. The remaining 25 percent (10 percent within limited resource areas) must come from local sources as cash or in-kind services. Public and private landowners are eligible for assistance but must be represented by a project sponsor. Sponsors are responsible for providing land rights to do repair work and securing the necessary permits. Sponsors are also responsible for the local cost share and the installation of work. EWP Program work is not limited to any one set of prescribed measures. NRCS makes case-by-case investigations of the need. EWP Program work includes removing debris from stream channels, road culverts, and bridges; reshaping and protecting eroded banks; correcting damaged drainage facilities; repairing levees and structures; reseeding damaged areas; and purchasing floodplain easements. The EWP Program is dependent upon supplemental appropriations from Congress. In FY 2008, USDA rovided NRCS $490,464,000 from discretionary funding provided by a Congressional supplemental appropriation. - loodplain Easements. Congress established the Emergency Watershed Protection (EWP) Program to espond to emergencies created by natural disasters. Section 382 of the Federal Agriculture Improvement d Reform Act of 1996 (P.L. 104-127), amended the EWP Program to provide for the purchase of oodplain easements as an emergency measure. Since 1996, NRCS purchased floodplain easements on gricultural lands that qualify for EWP Program assistance. Floodplain easements safeguard lives and roperty from floods, drought, and the products of erosion through the restoration, protection, management, intenance, and enhancement of the functions and values of floodplains, including the conservation of atural values, flood water retention, and erosion control. - CS may purchase EWP Program easements on any floodplain lands that have been impaired within the ast 12 months or that have a history of repeated flooding (i.e., flooded at least two times during the past ten years). Under the floodplain easement option, a landowner offers to sell a permanent conservation easement that provides NRCS with the full authority to restore and enhance the floodplain’s functions and values. In exchange, a landowner receives the least of one of the three following values as an easement payment: 1) a geographic area rate established by the NRCS State Conservationist; 2) the fair market value 234 25g-33 based on an area-wide market analysis or an appraisal completed according to the Uniform Standards of Professional Appraisal Practices (USPAP); or 3) the landowner offer. The easement provides NRCS with the full authority to restore and enhance the floodplain's functions and values. NRCS may pay up to 100 percent of the restoration costs of the easement. Restoration efforts include both structural and non-structural practices. To the extent practicable, NRCS actively restores the natural features and characteristics of the floodplain through re-creating the topographic diversity, and providing for the re-establishment of native vegetation. The landowner is provided the opportunity to participate in the restoration efforts. Landowners retain several rights to the property, including quiet enjoyment, the right to control public access, and the right to undeveloped recreational use such as hunting and fishing. At any time, a landowner may obtain authorization from NRCS to engage in other activities provided that NRCS determines it will further the protection and enhancement of the floodplain easements. In FY 2009, NRCS made $72 million available for floodplain easement purchases in four Midwestern States affected by flooding in the summer of 2008. Additional information on EWP is available on the NRCS website at: http://www.nrcs.usda.gov/programs/ewp/index.html EWP Recovery Program Status and Accomplishments for FY 2009 General: Outputs: Disaster Events Funded (Number) 42 Debris Removed (Feet) 597,406 Disaster Events Unfunded (Number) 55 Streambank Stabilized (Feet) 544,231 Completed Projects (Number) 85 Land Protected (Acres) 18700 Costs: - People Benefited: Technical Assistance $11,686,158 Minority (Number) 432,505 Financial Assistance $71,222,402 Other (Number) 1,315748 Local Contribution $11,132,029 . Total (Number) 1,748,253 Total Costs $94,040,589 - - - ... ' - 8(a) Contracts: - Benefits: Number 29 Outcomes: Value of 8(a) Contracts 2,433,846 Public Buildings Protected (Number) - 238 - Private Buildings Protected (Number) 5,083 Total Benefits: Roads Protected (Miles) 5,286 Economic $505,707,207 Utilities Protected (Number) 424 Value of Property Protected $743,089,186 Cost/Benefit Ratio - 1.0:5.3 Selected Examples of Recent Progress - Kentucky - May Flood Event 2009: Governor Steve Brashear declared a State of Emergency on May 10, 2009, in eastern Kentucky due to a devastating flood event that affected 12 counties. The Governor requested and received a Presidential Declaration and Federal Emergency Management Agency assistance. NRCS damage assessment teams entered the affected area on May 11, 2009, to complete initial damage assessments shoulder-to-shoulder with county judge executives, and their emergency management officer. The initial reports from NRCS indicated this was the worst storm-related damage NRCS observed in 20 years. Flooding had severely damaged or destroyed over 400 homes, and mudslides had blocked numerous roads. More than 150 homes were damaged or destroyed by a tornado that had also resulted in three deaths and several people hospitalized. In some instances, mobile homes were washed downstream, then piled up against bridges and broke apart. More than 21,000 people were without water due to mudslides and severe bank erosion had damaged or broken water mains (many waterlines are run along or across streams), and numerous roads were severed or threatened to cave in from bank erosion. Some shelters had to be 235 25g-34 evacuated due to flooding. The Governor mobilized the National Guard to evacuate people, deliver water, and protect homes. - : By May 15, 2009, NRCS had completed damage estimates in seven counties that totaled nearly $5million. One million in financial assistance was authorized by NRCS so work could begin over the weekend on several critical sites. - • In Pike County Kentucky, a bridge collapsed into the stream. The EWP Program assistance provided funding so debris that included rocks, mud, and a damaged bridge, could be removed and the county could restore temporary access. One hundred and seventy thousands dollars in financial assistance was made available to remove debris and allow eight families to access their homes. • In Pikeville County, a road bank had washed away and caused the road to slip. This road provides access to over 500 homes, and damage had disrupted school bus and emergency rescue traffic. Under the EWP Program, $330,000 is being provided to clear the mudslides and trees from the stream, and redirect the stream channel away from the road back to its original path. • At Southside elementary school, EWP Program is providing assistance to remove stream debris from the access road, alleviating a major flooding threat to the school. In each of these situations, NRCS has designed all the necessary engineering solutions, surveyed the area for impacts to unknown archeological resources, consulted with the U.S. Fish and Wildlife Service to avoid impacts to threatened and endangered species, and provided onsite construction inspection. North Dakota. Swan Buffalo Creek Dam No. 12, locally known as Absaraka Dam, was constructed in 1960 under the PL-566 Small Watershed Program. It controls 13 square miles of drainage area in southeastern North Dakota and protects high valued agricultural land in the Red River Valley, a few farmstead homes along Swan Creek, and several township roads. Due to near record snowfalls during the 2008winter and the subsequent snowmelt runoff, Absaraka Dam experienced auxiliary spillway flow in late March of 2009. This flow resulted in erosion along the southern edge of the spillway that began to migrate, or head-cut, upstream toward the crest section. This head-cut moved to within approximately 30 horizontal feet of the level crest section, threatening a complete breach of the structure and potential downstream area flooding. The auxiliary spillway flow subsided after a few days due to below-freezing temperatures, but the threat to the structure remained. Several inches of water remained in the watershed from unmelted snow, and then additional snowstorms occurred in late March and early April. A barrier system was installed on April 10, 2009 and April 11, 2009 under the EWP Program to protect the eroded area of the auxiliary spillway from further erosion. Auxiliary spillway flow began again on April 12, 2009, and continued through April 15, 2009. Without this barrier system in place, it is highly likely the head-cut would have migrated further upstream through the level crest section and caused a catastrophic failure of the dam. Potential loss of life and property was averted due to the efforts made through the EWP Program. 236 25-39 NATURAL RESOURCES CONSERVATION SERVICE Watershed Rehabilitation Program The estimates include appropriation language for this item as follows: Watershed Rehabilitation Program For necessary expenses to carry out rehabilitation of structural measures, in accordance with section 14 of the Watershed Protection and Flood Prevention Act (16 U.S.C 1012), and in accordance with the provisions of laws relating to the activities of the Department, [$40,161,000]$40,497,000, to remain available until expended. (16 U.S.C. 1001 et seq.; Agriculture, Rural Development, Food and Drug Administration, and Related Agencies Appropriations Act, 2010.) 237 25-40 NATURAL RESOURCES CONSERVATION SERVICE watershed Rehabilitation Program Appropriations Act, 2010 $40,161,000 Budget Estimate, 2011 40,497,000 Increase in Appropriations - - _t}36,000 Summary of Increases and Decreases (On basis of appropriation) 2010 Program 2011 Item of Change Estimated Pay Costs Changes Estimated Watershed Rehabilitation Program............... 1 + º- 40.4 Project Statement (On basis of appropriation) 2009 Actual : 2010 Estimated : . Increase : 2011 Estimated : Staff: : Staff: {\t : : Staff Program Amount Years: Amount : Years: Decrease : Amount Years Watershed Rehabilitation: : : - : : : : Technical Assistance.... $33,050,000: 64: $17,200,000: 63: +$336,000: $17,536,000: 29 Financial Assistance..... 6,950,000; --: 22,961,000; --. --; 22,961,000: -- Total, Appropriation........ 40,000,000. 64–40,161,000; 63:- 336,000; 40,497,000; 29 Project Statement (On basis of available funds) 2009 Actual : 2010 Estimated : Increase : 2011 Estimated : Staff: : Staff: Or : : Staff Program Amount : Years: Armount : Years: Decrease : Amount :Years Watershed Rehabilitation: ; : : : : : Technical Assistance .... $25,263,450: 64: $25,633,000: 63: -$8,097,000: $17,536,000 29. Financial Assistance..... 11,223,780: --: 24,474,369: --: -1,513,369: 22,961,000; -- Total Direct Obligations... 36,487,230: 64: 50,107,369: 63: -9,610,369: 40,497,000: 29 Unobligated balance : : : : : : brought forward.............. (-4,329,029) -- (-9,946,369) --: (+9,946,369): ~~. -- Prior Year Recoveries....... (-2,692,447) --: --. --. --> --> -- Offsetting Collections....... (-510,629) --: --> --> --. --> -- Reimbursements.................. (+1,098,506) --: --. --. ---. -- ~~ Change in customer Payments -- ~~. -- ~~. --. ---. -- Not Available Carried Fwd --> --. --> --> --: --. -- Unobligated balance : : º t º º carried forward............... (+9,946,369) --: --> --> --. --> -- Adjusted Appropriation.... (40,000,000) --: (40,161,000) -- (+336,000) (40,497,000): – Reimbursable Oblig.......... 1,098,506: --. --> --> --. -- ~~ Obligational Authority...... e - 7.369; 63: - 238 of: (a) Iowa 25–41 Justification of Increases and Decreases (1) A net increase of $336,000 for Watershed Rehabilitation ($40,161,000 available in 2010) consisting An increase of $336,000 to fund increased pay costs. This increase supports achieving the Agency’s strategic goals and objectives of reducing risks from flooding to protect individual and community health and safety. The increased pay cost funds will be used to paysalaries and benefits for existing staff. Geographic Breakdown of Obligations and Staff Years * * * * * * * * * 4 is ºr º e º 'º $ e & tº ſº a g º a s gº tº us tº º sº as y º & a tº * * * * * * * * * * sº ºr e º eit * * e se e º sº tº ſº tº a tº e º & & a v is 4 e * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * tº is tº * * * * * * * * * * 4 e º g º ºr * • * * * * * * * * * * * * * * * * * * * Kansas Michigan..... Minnesota... Mississippi. Missouri...... * * * * * * * * * * * * * * * * * 9 tº ſº. s is º is $ it tº £ it is ſº e g º ºr g g g º gº as e e º a gº ºn e s tº e º ſº gº gº & 4 & ſº a tº ſº tº e tº e º & sº * * * * * * * * * * * & a ve a g º e º 'º - as º ºs º is e º ſº tº tº * * * * * * * * * * * * * * * * * * * * • * * e º 'º e º ºs º is e º & & e & e s wº • * * * * * * g e < * * * * * * * * * * * * * * * * * * * * * * * * g e is g º g New Hampshire.............. New Jersey. New Mexico New York ... * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * e º tº tº º ſº, º & & me tº e º ºs º º is º g º Aº Oregon........ Pennsylvania Puerto Rico tº ºs e º 'º º e º 'º e º & tº gº a º e º º ºs w 4 tº e º A * * * * * * * * * s s e is e * * * * * * * * * * * * * * * * * * * tº ºn tº º, ø, º º ſº tº s tº tº ºr e g º ſº. 4 º' tº South Carolina..............* * South Dakota.................. Tennessee ... Texas * * * * * * * * * * * * * * * * * * * * * e º 'º e º y º & ºr e º gº º tº e º sº ºf e West Virginia.................. Wisconsin... * * * * * * * * * * * * * * * * e s tº º 2009 Actual and Estimated 2010 and 2011 2009. 2010 2011 - Staff Staff Staff Amount Years Amount Years Amount Years $230,212 ** $29,459 sº-sº $24,700 sº-º. 7,241,167 5 12,875,000 5 12,102,100 3 9,956 iº tº 60,000 ** 50,200 fº 22,000 * * 428,000 3 358,200 1 9;189 tºº 20,000 ſº 16,700 sº 420,250 4 375,000 2 313,800 2 tº ºs tº gº 46,000 i rags 38,500 sº tº 1,235,000 * * 140,000 tºº 117,200 wºº 302,325 ºgºs 78,070 wºrsº 65,300 *º tº 29,937 sººg sº as tº gºtºs *sº 821,526 1 149,400 f 125,000 1 1,006,463 3 2,312,400 4 2,080,000 1 219,021 sº tº 569,079 ºf tº 476,200 º 954,001 5 835,000 5 698,700 2 e smºº tº ºr 83,600 sº 70,000 *** 20,000 £º ºf 1,486,600 sºº 1,421,400 *E* 49,774 sº 106,000 dº tºº. 88,700 sºsºr 629,625 f 619,116 I 518,100 1. 190,443 1 56,838 Jºe 47,600 ** ** ** 334,400 *s ºne 279,800 •ºg ºr 833,905 5 1,066,000 5 952,400 1 102,110 1 357,541 1. 300,400 f 6,839,609 14 12,887,200 18 11,967,500 4 3-º-º-e tºº 40,000 sº ge 33,500 wºº 977,971 1 771,280 1 645,400 1. 176,161 tºº 10,705 sº tº 9,000 ** 144,458 1. 185,000 1. 154,800 1 4,230,056 4 1,944,485 4 1,627,200 2 713,559 1 460,000 1 384,900 1 2,012,141 4 492,439 4 412,100 2 460,465 tº ºs 1,295,646 ** 1,084,200 pºº 69,604 ** 400,000 sºme 334,700 ** 239 25-42 NATURAL RESOURCES CONSERVATION SERVICE Watershed Rehabilitation Program 2009 2010 2011 Staff - - Staff Staff Amount Years Amount Years Amount Years Wyoming........................ 116,625 1 151,253 f 126,600 1 National Hdqtr................ 5,962,838 9. 3,927,778 3. 3,286,600 3 National Centers............. 398,987 3 312,874 3. 261,800 i Nat. Tech. Sup. Cen........ 57,852 tºº- 28,366 **t 23,700 tº-º- Undistributed.................. •º º- ** 5,172,840 -- º * * Total Obligations/Est...... 36,487,230 64 50.107.369 63 40.497,000 29 Classification by Objects 2009 Actual and Estimated 2010 and 2011 Personnel Compensation: - 2009 - 2010 2011 Washington, D.C. • $1,108,012 $1,101,320 490,770 Field 4,015,417 3.904,680 1.846.230 11 Total personnel compensation........ - 5,123,429 5,006,000 2,337,000 12 Personnel benefits........................... 1,393,673 1,362,000 636,000 13 Benefits for former personnel......... •- *- wº- ** Total pers. comp. & benefits.......... 6,517,102 6.368,000 2.973.000 Other Objects: - - 21 Travel 329,142 319,000 153,000 22 Transportation of things................. 48,587 - 48,000 - 23,000 23.1 Rent payments to GSA................... -- - * * ** 23.2 Rental payments to others.............. 349,592 340,000 163,000 23.3 Communications, utilities, and - - - misc. charges 122,414 118,000 57,000. 24 Printing and reproduction............... 15,590 16,000 7,000 25.1 Advisory and assistance services.... 9,225,074 - ** ** 25.2 Other services - 9,306,014 17,457,000 13,696,000 25.2 Construction contracts.................... - 7,574,713 21,866,000 20,514,000 26 Supplies and materials.................... 234,761 228,000 109,000 31 Equipment * , 754,099 732,000 351,000 32 Land and structures............... w w w w w w w w v -- ** ** 41 Grants.......... * - 2,002,706 2,608,369 2,447,000 42 Insurance and loans........................ . 1,010 - 1,000 1,000 43 Interest and dividends..................... 6,426 6,000 - 3,000 44 Refunds. ºn tº ºpº - * Total other objects.............. s & ºr n x * * * * * * * 29,970,128 43,739,369 37.524,000 Total, direct obligations 36,487,230 50,107,369 40,497,000 240 25–43 NATURAL RESOURCES CONSERVATION SERVICE Watershed Rehabilitation Program SUMMARY OF RECOVERY ACT FUNDING Item of Change 2009 2010 2011 Watershed Rehabilitation Program - $50,000,000 mºsºs - º Project Statement- Recovery Act (On basis of available funds) 2009 Actual : 2010 Estimated : Increase: ; 2011 Estimated : Staff: - : Staff: {}f : : Sta Program Amount : Years: Amount :Years: Decrease : Amount :Years Watershed Rehabilitation: : : : : : : Technical Assistance .... $3,516, 199: 8: $6,483,801: 36: -$6,483,801: --: -- Financial Assistance..... 14.325,000: --: 25.675,000: --- -25.675,000: -- ~~ Total Direct Obligations... 17,841,199: 8: 32,158,801: 36: -32,158,801: --: -- Unobligated balance : : . - : : - : : brought forward.............. --: --, (-32,158,801) --: (+32,158,801) -- ~~ Prior Year Recoveries....... --> --> --> --. --: --> -- Unobligated balance - : : e & : º carried forward ............ (+32,158,801) --: --> --. --: -- ~~ Adjusted Appropriation.... (50,000,000): -; --> --> --. -- ~~ Reimbursable Oblig.......... --> --> -- ~~. -*. •- ~~ Obligational Authority...... 17.841,199: 8–32,138,801,–36: -32,158,801; *- : *- Program Implementation Activities: Goals and Coordination Efforts: The authority for rehabilitation of aging watershed dams is included in section 14 of the Watershed Protection and Flood Prevention Act of 1954 (PL 83-566). Any of the over 11,000 dams in 47 States that were constructed under the four watershed programs (PL-534, PL-566, Pilot, or RC&D) are eligible for assistance under this authority. Many of these dams are nearing the end of their 50-year design life and are in need of rehabilitation to address critical public health and safety issues. The goals of the Watershed Rehabilitation Program are to assist the sponsors (dam owners and operators) to ensure the safety of dams constructed under the authority of the Watershed Protection and Flood Prevention Act (PL 83-566), or any of the other three watershed programs (PL-534, Pilot, or RC&D). All projects are carried out with the assistance of the sponsors, which may be any State agency, county or groups of counties, municipality, to or township, soil and water conservation district, flood prevention or flood control district; Indian Tribe or Tribal organization, or any other nonprofit agency with authority under State law to carry out, maintain, and operate watershed works of improvement. NRCS may provide technical assistance and up to 65 percent of the total rehabilitation project cost. Objectives: The objective for use of the American Recovery Reinvestment Act Watershed Rehabilitation funds is to address hazardous conditions that the State agency with dam safety responsibility has identified as a priority 241 25-44 and that are owned or operated by sponsors that are ready and able to begin rehabilitation. Consideration is also given to projects that will protect the greatest number of people. Delivery Schedule: Funding was allocated in March 2009, to selected projects. Milestones for implementation include the date ) the rehabilitation plan will be authorized for each project; 2) the design will be completed; 3) the financial assistance will be obligated; and 4) the rehabilitation is completed. Performance Measures: Performance Data 2009 Actual 2010 Target 2011 Target Watershed Rehabilitation Number of jobs created or saved 532 957 dºº Unsafe dams rehabilitated or removed, number •º ºn 7 19 Note: Jobs created or saved were developed by using IMPLAN, designed by the USDA Forest Service, Federal Emergency Management Agency, and USDI Bureau of Land Management. - Geographic Breakdown of Obligations and Staff Years 2009 Actual and Estimated 2010 and 2011 2009 2010 2011 Staff Staff Staff Amount Years Amount Years Amount Years *rkansas......................... 28,122 tº tº 1,466,878 2 sº gº tº gº onnecticut..................... 90 sº sº tº sº. Jºãº **** Georgia........................... 550,000 ** 5,615,000 6 sº ** Kansas - 110,007 sº º 1,024,993 i zºº. * -º Massachusetts................. 280,127 gº ºn 4,084,273 4 * * .gs gº issouri.......................... 43,861 swº 356,139 I *$º * * Nebraska......................... 912,789 tº rººf 273,211 1 $ºg ºf wº sº. ew York....................... 2,053 ** 2,742,147. 3 tº ºf ** Oklahoma....................... 14,178,506 2 1,160,494 2 tº ºne sººns £XàS 327,630 1 4,497,370 5 * ºf gº tº Virginia........................... 37,685 ** 4,317,315 4 ** * tº est Virginia.................. 1,049,553 2 3,070,447 3 as tº sº sº National Haqtr................ 72,025 1 171,175 i *- ºr sº tº National Centers............. 248,751 2 1,352,248 3 sº as sº ndistributed.................. sº ** 2,027,111 gº tº ** * tº Total Obligations/Est...... 17.841.199 8 32,158,801 36 gº gº tº gº 242 25g-35 NATURAL RESOURCES CONSERVATION SERVICE WATERSHED REHABILITATION PROGRAM STATUS OF PROGRAM Current Activities - _ " - -- - Background. Local communities have constructed more than 11,000 watershed dams with assistance from NRCS since 1948. These dams protect America's communities and natural resources with flood control but many also provide the primary source of drinking water for some areas, as well as recreation and wildlife areas for others. These projects have become an integral part of the communities they were designed to protect. But like highways, utilities, and other public infrastructure, these dams need to be rehabilitated to protect public health and safety and to meet changing resource needs. Some communities that have been protected by these watershed dams are now more vulnerable to the devastation caused by flooding because many of the dams have reached or will soon reach the end of their 50-year design life. In 2009, 1,344 watershed dams reached the end of their designed life-span. By 2015, this number will exceed 4,300. Time has taken its toll on many of the dams: spillway pipes have - deteriorated and reservoirs have filled with sediment. More significantly, subdivisions and businesses hav been built in areas that were once agricultural land the dams protected from flooding. As a consequence, i a dam should fail, a serious threat would be posed to the health and safety of those living downstream and to the communities that depend on the reservoir for drinking water. A dam failure would create serious adverse environmental impacts to the ecosystem. Additional program information and the Watershed Rehabilitation Progress Report can be found on the NRCS webpage at http://www.nrcs.usda.gov/programs/WSRehab. N u m be r of W a t e r s h ed D a m s T h a t W i ! I R e a ch the E n d of The ir D e sign L ife, B y Ye a r T h rough 2 0 1 5 4,500 4,000 3,5 0 0 £ 3,000 tº f § 2,5 0 () * # 2,000 : - = 1,500 1 ,000 5 0 0 0. § 3 ; # # 3 # 3 # 5 ; ; ; ; cº ºl ©M (N Cº. $3 ©! Cºd ^: º: tº: tº: £º tº Y e a r Authorizing Legislation and Pilot Projects. In November 2000, P.L. 83-566 was amended by P.L. 106- 472 “The Watershed Rehabilitation Amendments of 2000,” which authorized NRCS to assist communities to address public health and safety concerns and environmental impacts of aging dams. NRCS may provide technical and financial assistance for the planning, design, and implementation of rehabilitation projects that may include upgrading or removing the dams. NRCS may provide 65 percent of the total cost of the rehabilitation projects; however, Federal funds cannot be used for operation and maintenance 243 25g-36 ctivities. Rehabilitation also provides opportunities for communities to gain new benefits, such as adding unicipal and irrigation water supplies, recreation, and wetland and wildlife enhancement, The FY 2000 and FY 2001 Agricultural Appropriations Acts included authorization for a total of $16 illion of EWP funds for pilot rehabilitation projects. The maximum amount of Federal funds eligible for ese pilot projects was 65 percent of the total rehabilitation project costs. NRCS worked with local project ponsors, State dam safety agencies, and community leaders on these high priority pilot projects that ddress public safety concerns and environmental issues. The pilot projects in New Mexico, Mississippi, Ohio, and Wisconsin include rehabilitation of 32 dams in 20 watershed projects. Community Interest. Project sponsors submitted requests for Federal assistance totaling $19.4 million for the rehabilitation of 82 high priority dams in 21 States in FY 2009. Over $14 million in requests were eceived from public sponsors of 716 dams to have the condition of their dams assessed in order to consider rehabilitation alternatives to maintain safe dams. - - Appropriations. FY 2009 was the eighth year of funding for watershed rehabilitation with $40 million appropriated. A total of 82 rehabilitation projects in 21 states were funded in FY 2009, and 650 dam assessments were funded in 27 states. In FY 2002, $10 million was appropriated; $29.8 million in FY 2003; $29.6 million in FY 2004; $27.5 million in FY 2005; $31.5 million in FY 2006, $31.3 million in FY 2007, and $19.8 million in FY 2008, Dams that pose the highest risk to life and property have been the highest priority for funds. - . . . " - Summary of watershed Rehabilitation Projects and Allocations as of September 30, 2009 Tº:1 Number Of Number of FY 2009 unded Dam - Dams Federal State - *::::ojects Rehabilitated Allocations' Alabama 1 - . . . 1 $250,000 Arizona 6 {} 7,252,476 Arkansas 5 {} . 10,000 California 1 0 {} Colorado 0 {) 150,000 Connecticut () 0 29,424. Georgia #2 3 432,194 Iowa 4 4 0 Kansas 3 0 1,235,000 Kentucky 4 1 366,000 Louisiana 0 0 29,937 Massachusetts 6 {} 821,530 Mississippi 20 15 1,449,000 Missouri 5 1 610,000 Montana 2 0 0. Nebraska #1 5 954,000 Nevada () {} 80,000 New Hampshire {} 0 20,000 New Jersey l {} 50,000 New Mexico 8 3 1,028,240 North Carolina 0 {} 320,000 North Dakota 3 {} 933,900 New York 6. () 198,918 Ohio 9 8 271,671 Oregon 0. {} 20,000 Oklahoma 44 18 7,781,319 244 25g-37 º Number Of Number of FY 2009 unded Dam • Dams Federal State * * Rehabitated Allocations Pennsylvania 3 {) 1,182,354 South Carolina 0 0. 180,000 Tennessee 2 2 145,292 Texas 17 9 4,897,942 Utah 1 0 700,000 Virginia 9 5 2,144,537 West Virginia 2 {) 2,260,000 Wisconsin 13 11 370,000 Wyoming 1 0. 142,000 NHQ () 0. 4,376,635 Total 200 86 $40,692,069 1. Allowances include project planning and implementation. Carryover funds and prior year recoveries are included in the allocation. - Meeting Challenges through Partnerships. Partnerships between local communities, State governments and NRCS leverage funds and services and allow many projects to move quickly through the planning and implementation stages. • Technical capacity. NRCS does not have technical staff capacity to respond to all requests for watershed rehabilitation assistance from project sponsors. Private consultants were hired to provide additional technical capacity to conduct assessments of the existing conditions of dams, provide topographic surveys and mapping, geologic investigations, as well as detailed planning and design services. Some sponsors have used either their own professional staff or acquired technical services a part of their “in-kind” contribution to meet their 35 percent cost-share requirement. • Financial assistance. The watershed rehabilitation authorization requires local sponsors to provide 35 percent of the total project cost. Sponsors used many innovative means to obtain the funds necessary to address the rehabilitation of the aging dams that were threatening their local communities. Some sponsors used the sale of bonds dedicated to dam safety and rehabilitation, levied taxes on - beneficiaries, obtained grants, used State appropriations, sought voluntary land rights from private landowners, and provided in-kind services using existing staff. Selected Example of Recent Progress Project Status and Benefits. By September 30, 2009, the rehabilitation of 139 dams was authorized in 22 States. The rehabilitation of 86 dams has been completed. The remaining 53 authorized rehabilitation projects are being implemented subject to funding priorities. The following table summarizes the benefits provided by the 86 completed projects: - Average annual floodwater damage reduction benefits ($): $5,259,614 Average annual non-floodwater damage reduction benefits ($): $2,904,087 People with reduced risk downstream from the dams (No.): 4,312 People who benefit from project action (No.): - 201,185 Homes and businesses benefiting from project action (No.): 6,021 Farms and ranches benefiting from project action (No.): 547 Bridges benefiting from project action (No.): 195 Alabama Choccolocco Creek Watershed Project: Dam #11 was constructed in 1971 for flood control and municipal water supply. The dam is in a \different setting than when it was originally constructed. Over the years, population growth and urban sprawl have occurred both upstream and downstream from the dam, and land use changes have taken place. Rehabilitation of the dam will insure a safe water supply and provide increased safety to occupants of 23 homes and the multi-million dollar water treatment plant. 245 25g-38 e sponsors, the Water Works and Sewer Board of Anniston, Alabama, requested assistance under the atershed Rehabilitation Program to upgrade the dam to meet current Federal standards for a high hazard Rehabilitation consisted of installing a concrete parapet wall to raise the top of the dam 5.3 feet and ther treatments to the dam, principle spillway, and auxiliary spillway. e sponsors performed all of the work on the parapet wall and auxiliary spillway. The City work crew as experienced in concrete construction and did an excellent job building the parapet. Installation of the prap toe protection, and metal work replacement was performed under contract administered by the Water Works and Sewer Board. - - w Virginia Pohick Creek Watershed Dam #4, Fairfax, Virginia: Pohick Creek Dam #4 is a $1.5 million ehabilitation project completed in the fall of 2008. The rehabilitation minimizes the threat to loss of life or approximately 700 residents who live and work downstream in 168 homes, 35 businesses, ransportation routes for medical and emergency services, two railroads, and a number of water, gas, and :ommunication lines. The Northern Virginia Soil and Water Conservation District and Fairfax County sponsored the project, with unding from the county and NRCS. The county administered the construction contract, facilitated public meetings, and set up a task force of constituents to participate in the rehabilitation process. The County :ollected data and secured the engineering design. º consisted of realigning the auxiliary spillway to direct overflows away from homes built fter the original c, astruction to a channel downstream from the dam. The spillway was widened and },000 cubic yards of material were imported to construct dikes and a stilling basin. Articulated concrete }locks were used to armor the auxiliary spillway and stilling basin to prevent erosion during major flood :vents. The blocks were then covered with topsoil and vegetated to maintain recreational aspects of the €3. hio Caldwell Lake Dam, Noble County: Caldwell Lake Dam was constructed in 1969, and provides ater supply for 1,200 residents, 160 businesses, and six industries in and around Caldwell, Ohio. This ging dam required rehabilitation to meet dam safety standards in consideration of 75 homes at risk should e dam breach. The rehabilitation project was sponsored by the Village of Caldwell, Ohio. The dam was raised 6.5 feet in height, and the auxiliary spillway was raised 2.3 feet and widened from 40 eet to 150 feet. Donstruction to rehabilitate the dam began in August 2008, and was completed in July 2009. Rock had to he drilled and blasted to enlarge the auxiliary spillway. To raise the dam, this rock was placed and ompacted to create a rock fill bench on the downstream face of the dam. Earth fill was then compacted over the rock fill bench. Earth fill was used to increase the elevation of the auxiliary spillway. The rincipal spillway riser and the water supply risers were repaired and refurbished. A township road was hifted to allow room for the rehabilitation. The rehabilitated dam will provide downstream safety and water supply for the Village of Caldwell for 100 years. - 246 25-45 NATURAL RESOURCES CONSERVATION SERVICE Resource Conservation and Development The estimates include appropriation language for this item as follows (new language underscored; deleted matter enclosed in brackets): [Resource Conservation and Development] [For necessary expenses in planning and carrying out projects for resource conservation and development and for sound land use pursuant to the provisions of sections 31 and 32 of the Bankhead Jones Farm Tenant Act (7 U.S.C. 1010-1011; 76 Stat. 607); the Act of April 27, 1935 (16 U.S.C. 590 f); and subtitle H of title XV of the Agriculture and Food Act of 1981 (16 U.S.C. 3451-3461), $50,730,000: Provided, That not to exceed $3,073,000 shall be available for national headquarters activities.] - - - The change in language reflects the budget proposal to eliminate the program. 247 25-46 Resource Conservation and Development NATURAL RESOURCES CONSERVATION SERVICE Resource Conservation and Development: Total Appropriation.......... 1. Technical Assistance.... $50,730,000: 412:850,730,000: 412: -$50,730,000(a): Appropriations Act, 2010 $50,730,000 Budget Estimate, 2011 - - Decrease in Appropriations. -50,730,000 Summary of Increases and Decreases (On basis of appropriation) 2010 Other 2011 Item of Change Estimated Pay Costs Changes Estimated Resource Conservation and Development: - 1.Technical Assistance.......................... $50,730,000 ** –$50,730,000 wº-wº Total Available 50,730,000 *-ºxº -50,730,000 w sº Project Statement (On basis of appropriation) 2009 Actual : 2010 Estimated: Increase : 2011 Estimated : Staff: : Staff: Or . : Staff Program Amount Years: Amount : Years: Decrease : Amount :Years 248 25-47 Project Statement. (On basis of available funds) 2009 Actual : 2010 Estimated: Increase : 2011 Estimated : Staff: : Staff: OT: : Staff Program Amount :Years: unt:Years: : Amount :Years Resource Conservation : : : ty $ * and Development: : : : : : . : 1.Technical Assistance ... $50,620,483: 412:553,504,795: 412: -$53,504,795: --. -- 2. Financial Assistance..... --> --> +-tº- --. -*. -- Total, Direct Obligations. 50,620,483: 412: 53,504,795: 412: -53,504,795: -- ~~ Unobligated balance : : : : : : brought forward ........... (-2,345,834) -- (-3,028,713) --: (+2,774,795) (-253,918) -- Prior Year Recoveries ..... (-1,008,124) --: - --> --> --. --> -- Unobligated Expiring Bal. (+437,595) --: --> --> --. -- ~~ Offsetting Collections......... (-5,423) —: --. ---. --. --> -- Reimbursements.............. (-160) -: --. --> --> —: — Chg in Customer Payments (+2,750) ---. --> --- --- -- ~~ Not Available Carried Fwd. : --: (+253,918) --: . --: (+253,918) -- Unobligated balance : : : * : : carried forward ............ (+3,028,713) --: --: -- --. -- ~~ Adjusted Appropriation... (50,730,000) --: (50,730,000) --: (-50,730,000) -- ~~ Reimbursable Obligations: (a) Technical Assist...... (b) Financial Assist....... Reimbursable Oblig......... Obligational Authority..... Justification of Increases and Decreases (1) A decrease of $50,730,000 for Resource Conservation and Development ($50,730,000 available in 2010): (a) A decrease of $50,730,000 and 412 staffyears for the Resource Conservation and Development program activities, - The fiscal year 2011 budget proposes to terminate funding for the Resource Conservation & Development (RC&D) program, first begun in 1962. RC&D areas have received Federal financial support for at least 20 years. At this point, most of these communities should have the capacity to identify, plan, and address their identified priorities. In addition, a 2006 USDA Report to Congress found that the RC&D program provides Administrative and Operational support to the councils, which equals 16 percent of their total funding. 249 25-48 Main Workload Factors 2009 2010 —Actual Estimate tatus of Designated RC&D Areas: - Areas funded at start of year 375 375 New areas funded in year ** — Total Areas funded end of year 375 375 Applications on hand (39) (39) 2009 2010 Actual Estimate &C&D Project Activity: Project Plans: Approved During year..... 3,848 4,000 Cumulative...... 95,531 99,531 Ongoing During year..... 7,039 6,800 Completed During year 4,178 4,200 Cumulative...... 83,343 87,543 Input of Resources to Projects ($ in 1,000's): value of donated materials attributable to a project.) 2011 Estimate 375 375 (39) 2011 Rstimate 4,000 103,531 7000 4,200 91,743 (Resources provided for accomplishing projects. Includes direct technical and financial assistance and - RC&D resources.................. During year......... * - -- •º ºr - Other Federal....................... During year......... $79,086 $50,000 $50,000 - State government................. During year......... 89,519 60,000 60,000 - Local government................ During year......... 19,996 20,000 20,000 - Non-government.................. During year......... 137,290 75,000 75,000 Rural Development Loans; - - 2009 2010 2011 Actual Estimated Estimated Item No. Amount No Amount No. Amount i. Loans obligated during year........... º ºg ** -- -- -- ** 2. Borrowers outstanding................... H $41,186 1. $9,819 -- * * 3. Loans cumulative........................... 292 29,484,709 292 29,484,709 292 29,484,709 Geographic Breakdown of Obligations and Staff Years 2009.Actual and Estimated 2010 and 2011 _2009 2010 2011 - Staff Staff Staff Amount Years Amount Years Amount Years Alabama........................... $1,118,400 9 $1,116,397 9 ** * - Alaska 1,013,146 8 1,189,481 8 ** •ºw Arizona 823,009 6 767, 108 6 wemw -- Arkansas........................... 974,066 8 888,582 8 *Y* mºtº Dalifornia......................... 1,350,657 11 1,623,862 11 -- - ºr Jolorado........................... 1,025,030 7 959,723 7 tº ºt * ºn Donnecticut...................... 287,669 2 289.936 2 *4-> •ºw- 250 25-49 2009 2010 2011 Staff • Staff Staff Amount Years Amount Years Amount Years Delaware.......................... 143,198 1 145,354 1 gº tº := gº Florida 1,026,489 8 909,245 8 sº -º-, ºr Georgia 1,310,033 9 1,385,639 9 *º-º-º: * National Centers............... 552,779 4 490,234 4 tº ºw sºº Nat Tech. Sup. Cents...... 57,367 *** * 60,079 *** sº º Undistributed.................... tºº tº º 2,298.735 ** * Wºº tº ºn Total, Available/Est.......... 50,620,483 412 53.504.795 412 dº tº tº º 251 25-50. NATURAL RESOURCES CONSERVATION SERVICE Resource Conservation and Development Classification by Objects 2009.Actual and Estimated 2010 and 2011 ersonnel Compensation: 2009 2010 Washington, D.C. - $685,373 $687,477 Field - _30,435,086 30,528,523 11 Total personnel compensation ........ 31,120,459 31,216,000 12 Personnel benefits........................... 8,362,955 8,388,000 13 Benefits for former personnel......... 14,876 - 15,000 Total pers. comp. & benefits........... 39,498,290 39,619,000 Other Objects: 21 Travel 1,177,557 1,171,000 22 Transportation of things..................- 121,128 120,000 23.2 Rental payments to others............... 1,535,210 1,527,000 23.3 Communications, utilities, and - miscellaneous charges................... - 1,182,938 1,177,000 24 Printing and reproduction................ 25,027 25,000 25.2 Other services 5,476,572 - 8,270,795 26 Supplies and materials.................... 787,835 784,000 31 Equipment 689,426 685,000 42 Insurance and loans......................... 122,676 .. 122,000 43 Interest and dividends..................... 3,824 4,000 Total other objects........................... 11,122,193 13,885,795 otal, direct obligations 50,62 53,504,795 2 252 25g-39 NATURAL RESOURCES CONSERVATION SERVICE RESOURCE CONSERVATION AND DEVELOPMENT PROGRAM STATUS OF PROGRAM Current Activities - Background. The Resource Conservation and Development (RC&D) Program was initiated under the Soi Conservation and Domestic Allotment Act, (16 U.S.C. 590a-590f), the Bankhead-Jones Farm Tenant Act, (16 U.S.C. 1010 and 1011), and the Food and Agriculture Act of 1962, and is authorized under subtitle H, title XV of the Agriculture and Food Act of 1981, (16 U.S.C. 3451-3461), as amended. The Food Security and Rural Investment Act of 2002 (2002 Act) permanently authorized the program. The NRCS administer the program. In 1981, sections 1528–1538 of the Agriculture and Food Act authorized a program to encourage and improve the capability of State and local units of government and nonprofit organizations i rural areas to plan, develop, and implement programs for resource conservation and development. Throug the program, the RC&D areas establish or improve coordination systems in rural communities, and build rural community leadership skills to more effectively use Federal, State, and local programs for the communities’ benefit. The 2008 Act further strengthened the relationship between the USDA and the RC&D areas. - The NRCS provides program administration and assistance to RC&D areas through volunteer non-profit RC&D Councils. Other USDA agencies with conservation or development responsibilities are involved in the development of program policy and guidance and are members of the USDA RC&D Policy Advisory Board and Workin, Group. These Agencies provide technical and limited financial assistance to RC&D Councils. RC&D Councils also obtain the assistance from other local, State, and Federal agencies, private organizations, and foundations to carry out their specific projects. The RC&D program blends natural resource use and conservation with local economic development. RC&D Councils and their sponsors initiate and lead the planning and implementation of their locally developed RC&D area plans, in association with State, local, and Federal governments, and non-profit organizations. Program objectives address improving the quality of life, including social, economic and environmental concerns; continuing wise use of natural resources; and strengthening the local citizens’ ability to use the assistance available through USDA and other Federal agency partnerships. Geographic Scope. The Secretary has designated 375 RC&D areas that serve 2,696 counties in every State, the Caribbean, and the Pacific Basin. Designated areas continue to serve over 85 percent of U.S. counties and more than 77 percent of the U.S. population. Another 38 applicant areas covering 231 additional counties have applied for the USDA Secretary’s designation. The 1990 Food, Agriculture, Conservation and Trade Act limited assistance to not more than 450 active designated areas. Since FY 2003, USDA designated RC&D areas have remained at 375. * RC&D Area and Council Operations. A RC&D area is a locally defined multi-county area, sponsored and directed by a RC&D Council that carries out the program encouraging natural resource conservation and utilization, accelerated economic development, and/or improvement of social conditions where needed to foster a sound local economy. The Council consists of sponsors from the public and private sector that represent a diverse cross-section of community interests. Sponsors include county and city governments, soil and water conservation districts, sub-state districts, Tribal governments, and other interested private organizations in the area. The RC&D Program epitomizes grassroots involvement and decision-making. From public meetings to identify community concerns, needs, and problems, the RC&D Council develops an area plan that details the goals, objectives, and action items needed to address the local communities’ priorities and concerns. The Council then collects data about identified problems, develops alternatives, and recommends solutions. Implementation of an action item may include one step or a full range of steps, such as problem identification, development of alternatives, plan development, and funding. 253 25g-40 C&D projects focus on eight broad areas: - Resource base protection projects for soil erosion control, noxious plant and pest control, streambank improvement, preservation of prime land, mined land reclamation, natural resource studies, energy conservation, and alternative sources of energy such as biomass. . Fish and wildlife projects for the protection, improvement, or development of fish and wildlife habitat. Waste management and utilization projects for the efficient and environmentally sound disposal of animal waste; development or improvement of a landfill; waste collection; solid waste disposal; composting and recycling of glass, metals, paper, wood, and furniture. - Community improvement projects that develop community infrastructure including studies on zoning, facilities or services needed, and project implementation. Projects include constructing and improving public trails; community centers and other old community buildings; constructing, improving or repairing subsidized housing; improving roads and parks; and, installing dry fire hydrants. Forestry projects improve forested areas through education on safety or harvesting techniques; developing or expanding forest related industries; developing wood waste energy sources; developing or improving value added forestry related products; studies such as forest inventories, species, or forest products; and improving rural road infrastructure with timber bridges. Economic development projects include marketing and producer surveys or feasibility studies; assisting with grants, loans, or other financing; assisting in the formation or expansion of agriculture or natural resource related businesses, or other businesses involved with value-added products. Projects can include improvement of agricultural production. Marketing and merchandising projects result in cooperatives or associations; business or marketing plans; and advertising and promotional materials. Water projects improve surface and groundwater quality and quantity. Many projects deal with pollution control and dispersing water. Projects include watershed management; construction or rehabilitation of irrigation, flood control systems; wastewater treatment; and, efficient use of aquifers. Recreation and tourism projects include feasibility studies and the creation or improvement of water- based recreational areas for swimming, boating, and canoeing, and boat launch sites; establishment or improvement of non water-based recreational areas such golf courses, rodeo arenas, trails, or ball parks; historic site preservation; and, establishment or upgrade of a tourist attraction. CS Program Support. NRCS assists the RC&D Council through an RC&D Coordinator. The RC&D oordinator facilitates the development and implementation of an individualized and locally determined rogram (i.e., area plan) with the RC&D Council and the local people. NRCS and other USDA agencies rovide planning and technical assistance for implementing the area plan, RC&D activities are broader those created from USDA assistance alone. The Coordinator is the link between the RC&D Council, s other partners, and the USDA. The goal is a RC&D Council that has the capacity to build effective ublic/private partnerships that result in strong rural community leadership and accomplishments. Other ederal agencies provide assistance to RC&D councils within their existing authorities and programs as eeded. State and local units of government also participate, as well as non-profits and private businesses. verview of FY 2009 Progress. RC&D Program management and information system indicators provide veral measures of success. Reporting areas indicated that RC&D Councils and their partners helped to eate 676 new businesses, expand 1,452 businesses, retain 4,469 businesses, and assist 401 businesses cially with funds totaling $25.9 million. In addition, Councils assisted in the formation of 129 peratives. An estimated 7,060 jobs have been created and 4,778 jobs retained through area projects, ationally, Councils obtained over $283.9 million in external grant funds in FY 2009. unding provided by non-RC&D appropriations sources indicates an RC&D program leverage of $5.60 for ery RC&D appropriation dollar invested. C&D Councils assisted 927 farm or ranch operations with agri-tourism activities and 704 farms or ches with direct marketing from the field to the consumer via Community Supported Agriculture groups CSAs), restaurants, commercial stores, or public access farmers markets. - 254 25g-41 Efforts to improve natural resources have resulted in the improvement of an estimated 2.42 million acres o wildlife habitat, 400,000 acres of lakes and other water bodies, and 7,731 miles of streams. RC&D Councils assisted over 1,871 animal agricultural operations with water quality projects; assisted with the construction or rehabilitation of 17 flood control structures; and preserved or protected over 601,701 acres of agricultural land. RC&D Councils in eight States implemented renewable energy projects. In FY 2009, RC&D Councils held over 6,100 workshops, tours and seminars nationwide on agriculture, aquaculture, forestry and wildlife; and over 2,900 training sessions on leadership development, grant writing, business development, non-profit management and environmental education. These educational projects have helped nearly 1.04 million people develop new skills. More than 500 natural resource relate school curricula and programs were created. RC&D projects have helped over 3.2 million economically o socially disadvantaged people. There were 631 instances of assistance provided to Tribal Nations through implementation of projects. RC&D Councils served over 14.5 million citizens nationwide. More than 4,000 projects that focus on the goals in RC&D area plans were completed in FY 2009. More than 6,800 projects will continue in FY 2010. As a non-profit entity, RC&D Councils are capable of applying for, receiving, delivering, administering, and reporting on all types of Federal funding including loans and grants. RC&D Councils have existing project applications in the area of economic developmen infrastructure improvements, renewable energy development, energy conservation, carbon sequestration and climate changes. Since 1964, RC&Ds have completed over 95,600 projects. More information on th RC&D program can be found on the NRCS RC&D homepage at http://www.nrcs.usda.gov/programs/rcdſ. Selected Examples of Recent Progress - Texas: The "Bio-Hybrid-Energy-Cycle" uses commercially grown plant cellulous and animal waste digested to biogas. The produced biogas combines with other forms of renewable energy to produce cle heat and electrical energy for decentralized, utility scale distribution. The by-products of the process include organic fertilizers, soil conditioners, bedding material and phosphate remediation for animal waste Acreage required to support the production of clean biogas does not compete with food or fiber production The Post Oak RC&D Council has implemented this six million dollars project, which has created a business and 28 jobs. - Wyoming: Harnessing Wind-Energy, as an alternative energy source, has sparked a new industry. The Southeastern Wyoming RC&D Council is dedicated to promoting and implementing wind energy development by forming landowner associations. Thus far, the Council has formed 11 wind energy associations to identify landowners’ leasing options and wind development rights. The goal of the associations is to enhance the marketability of the wind energy resources on members' lands by combinin those resources into a single marketing package. The associations use collective bargaining strategies to Successfully negotiate wind energy contracts with wind developers in ways that are environmentally sound and economically feasible. - Alabama: Establishment of a marketing cooperative to improve social and economic conditions. The Tombigbee RC&D Council has assisted 155 participants with the establishment of this cooperative to market rabbit, goat, sheep and other agricultural products. The investment in this project of $135,000 contributions has resulted in the creation of 60 jobs and the development of alternative agricultural enterprises in west Alabama. 255 25-51 NATURAL RESOURCES CONSERVATION SERVICE Healthy Forests Reserve Program Project Statement (On basis of available funds) 2009 Actual ; 2010 Estimated : Increase : 2011 Estimated : Staff: : Staff. Ör : : Staff Program Amount : Years: Amount Years; Decrease : Amount Years Healthy Forests Reserve Program: : : : : : Technical Assistance.... $29,209: : $110,944: ---. --. --. -- Financial Assistance..... 65,641: : 1,084.246 : --. ~~. -- Total Direct Obligations... 94,850: : 1,195,190: --: - --. ---. -- Jnobligated Bal. - ... --> --. --: -- Brought Fwd.............. (-1,274,274); -- (-1,195,190) --: ---. --. -- 'rior Year Recoveries...... (-15,766): ---. --. --. --. -- ~~ Jnobligated Bal. Carried Fwd.............. (+1,195,190): --: --> --. --. --. -- Adjusted Appropriation.... --. --. --, --. ~~. --> -- )bligational Authority..... --> --> --, --. --. * - sº - Wote: The 2008 Farm Bill provides $9,750,000 in FY 2010 and $9,750,000 in FY 2011 in mandatory unds. For this program see page 25-53 for further information. Geographic Breakdown of Obligations and Staff Years 2009.Actual and Estimated 2010 and 2011 2009 2010 2011 Staff Staff Staff s Amount Years Amount Years Amount Years kansas.......................... $9,269 * - *-- eº sº. -- tº tº aime.............................. 2,952 -- * - tº tº --- ese wº innesota........................ 22,699 *- - -- ſº 4- wº- - * * ississippi...................... 59,930 -w-s." $7,826 ** -- * - Indistributed............... *-- * - 1,187,364 *º- - wºvº $º tº |otal Obligations/Est....... 94.850 --- 1,195,190 * * -- * * 256 2009 As Personnel Compensation: Washington, D.C. Field 11 Total personnel compensation 12 Personnel benefits................... Total pers. comp. & benefits... • * * * * * * * * * * * g is sº & • In tº * * * * * Other Objects: 21 Travel 22 Transportation of things.................. 23.2 Rental payments to others....... 23.3 Communications, utilities, and miscellaneous charges..................... 24 Printing and reproduction................ 25.2 Other services • * * * * * * * 26 Supplies and materials.................... 31 Equipment 32 Land and structures................. 32.1 Easements - - - - - - - - 41 Grants 43 Interest and dividends..................... Total other objects........................... Total, direct obligations 25–52 Classification by Objects tual and Estimated 2010 and 2011 2009 $24,674 24,674 -9,126 15,548 1,152 2 1,600 –4 –46 10,681 71.6 –439 70,655 –5,015 79,302 —24,830 2010 -*- $7,925 ** 15,849 1,084,246 1,195,190 — 1,195,190. 2 {} i 1 -*- 257 25-53 NATURAL RESOURCES CONSERVATION SERVICE Farm Security and Rural Investment Programs 'ood, Conservation and Energy Act for 2010 $3,057,305,209 udget Estimate, 2011. 3,146,707,000 hange in Estimate _t}9,401,791 onservation programs included in this account are listed in the proj ect statement below. The Food, onservation and Energy Act of 2008, (P.L. 110-246) program funding authorization will continue from e Commodity Credit Corporation. Project Statement (On basis of authorized level) 2009 Actual : 2010 Estimated : Increase : 2011 Estimated : Staff: : Staff: OT & - : Staff Project Amount Years: Amount : Years: Decrease : Amount : Years Wetlands Reserve Program... $435,711,313; 191: $613,115,000: 256: -$110,889,000: $502,226,000: 281 nvironmental Quality Incentives Program.......... 1,054,581,563:2,395: 1,180,000,000: 3,290: +28,000,000: 1,208,000,000: 2,510 Agricultural Water , Enhancement Program........ 71,803,404: 66: 73,000,000: 151: +1,000,000: 74,000,000: 152 Wildlife Habitat Incentives Program ............ 72,742,931: 128: 85,000,000: 152: -12,000,000: 73,000,000: 143 arm and Ranch Lands Protection Program........... 118,766,171: 34: 150,000,000: 59: +10,000,000: 160,000,000: 51 onservation Security - - Program............................. 276,004,481: 220: 233,963,000: 152: -21,521,000: 212,442,000: 138 !onservation Stewardship Program............................. 9,378,239: 75: 469,442,000: 691: +160,055,000: 629,497,000: 483 irasslands Reserve Program 47,658,102: 30: 100,714,000; 42: -21,638,000: 79,076,000: 42 gricultural Management Assistance aſ...................... 7,378,139: 9: 7,500,000: 27: -5,000,000: 2,500,000: 18 hesapeake Bay Watershed Program........ 21,841,618: 25: 43,000,000: 83: +29,000,000: 72,000,000: 171 Carryover..................... --. --. 1,158,381: 9: -1,158,381: ––. - - ſealthy Forests Reserve Program ........... 2,526,172: 5: 9,750,000: 19: --. 9,750,000: 14 Carryover.................... ---. wº-wº 7,223,828: 1: -7,223,828: ~-: - 4- onservation Reserve TOgräfſ ............................. btotal, Food, Conservation and Energy Program........... 55,913,833: 538: 83,439,000: 759: +40,777,000: 124.216,000: 1,123 2,174,305,966:3,716: 3,057,305,209: 5,691: +89,401,791; 3,146,707,000: 5,126 –21,499,000: --. - - º wº * * -- {- -> 21,449,000: 14: And Energy Program........—2,174,305,966:3,716; 3,978,754,209; 5,705; +67,902.791; 3,146,707,000; 5,126 | The Food, Conservation and Energy Act of 2008 authorizes $15 million in Agricultural Management ssistance for FY 2010 and FY 2011. The Act authorizes half of that funding for NRCS, or $7.5 million ach year. A proposed savings of $5 million in FY 2011 reduces the total authorized level to $10 million hd NRCS’ portion to $2.5 million, as the entire savings is applied to NRCS. 258 25-54 Statement of Program Performance Targets – Performance Indicators FY 2009 FY 2010 FY 2011 - Actual Target Target Wetlands Reserve Program Farmland, forest land and wetlands protected by - conservation easements, acres 35,338 100,000 110,000 Environmental Quality Incentives Program Land with conservation applied to improve irrigation efficiency, acres 1,131,159 1,100,000 1,000,000 Wildlife Habitat Incentives Program - Non-Federal land with conservation applied to improve fish and wildlife habitat quality, acres 335,402 350,000 400,00 Farm and Ranch Lands Protection Program Prime, unique and important farmland protected from conversion to non-agricultural uses by conservation easements, acres 38,260 40,000 45,00 § WRP $20,546,081 45,682 116,711 10,431,401 16,867,424 905,440 686,463 727,050 77,500,994 3,611,578 545,937 362,018 4,166,649 7,268,440 17,640,505 4,456,657 5,220,035 6,027,942 55,288 5,530,298 5,005,342 6,258,333 31,476,845 5,037,831 8,274,593 654,211 23,515,569 14,151 20,942,604 2,526,333 147,290 5,888,398 8,099,698 23,902,063 3,980,791 4,819,145 14,078,200 2,181,302 CRP $443,900 145,573 - 639,414 74,284 551,462 59,088 101,710 502,983 2,180 381,803 4,108,804 3,475,003 4,368,124 2,080,295 2,094,920 634,541 83,625 623,863 9,255 828,073 4,441,351 1,057,284 2,512,035 1,150,855 1,945,765 4,976 118,556 198,205 392,227 696,726 3,790,827 2,722,503 542,581 539,713 2,051,778 x ºx-ºx Tºſºvº Tºlºw Jºº-ºº ºr ºf EQIP $16,311,381 6,152,895 22,516,248 19,002,199 69,871,185 33,800,294 6,816,196 7,077,784 22,601,981 19,488,912 9,570,632 14,832,652 15,709,481 15,188,522 27,210,886 25,937,264 13,535,128 19,695,687 11,333,733 9,256,586 6,983,159 20,013,700 34,845,586 15,723,298 24,163,300 28,471,044 28,217,397 8,065,889 6,545,719 6,481,452 24,321,149 17,748,998 17,974,403 25,728,653 19,452,40: 27,753,262 15,280,022 16,532,408 "ºº-ETNº Ai-w.º.º. Twº Tºxº~PTNTºrºſvº y LW. A.-r Farm Security and Rural Investment Programs Geographie Breakdown of Obligations CStP. $203,145 66,823 254,284 244,757 157,047 38,225 157,728 190,134 28,017 111,571 316,111 273,188 392,342 331,442 130,900 40,943 . #56,223 346,429 179,194 482,455 141,966 231,512 41,000 140,754 232,964 147,542 355,888 151,647 2609 Actual WHP FRPP $1,452,284 $570,377 3,027,373 717,026 1,500,608 $31,118 1,072,180 17,472 2,455,238 3,755,396 1,120,828 5,700,954 2,145,272 5,919,713 467,054 5,728,353 1,862,624 1,504,201 1,344,794 17,572 1,043,223 335,900 924,716 1,094,337 307,609 1,633,343 1,340,763 e- 957,650 246 H,283,349 1,036,736 1,659,472 3,188,404 1,655,725 - 890, #1 i 354,726 387,608 4,319,983 1,976,531 6,120,441 1,047,665 3,039,211 1,581,607 3,061,206 1,425,322 -- 1,450,390 21,171 770,62} 2,799,705 1,482,888 1,481,454 669,526 3,625,056 2,531,421 3,972,906 1,097,181 6,879,460 1,128,037 624,042 1,107,816 2,541,501 1,168,607 3,020,891 1,181,372 5,567 923,833 3,363,706 1,700,506 308,772 1,890,081 8,060 793,534 5,821,688 CSecº $2,225,245 25,811 328,747 11,431,543 6,628,659 4,932,799 65,035 1,159,766 173,255 4,507,867 426,890 13,498,622 8,877,502 8,429,225 22,553,084 10,240,248 883,957 319,408 730,775 5,590,559 38,061 8,103,871 8,186,591 660,222 29,533,414 11,645,434 14,414,903 402,193 15,372 176,129 1,333,133 1,599,549 1,396,469 9,640,013 16,774,266 6,082,618 23,950,400 2,004,132 AWEP $1,804,001 - 444,638 20,766,032 370,008 1,340,853 2,158,908 7,940,738 59,630 675,266 182,622 i,686,181 368,428 2,655,097 3,229,731 101,445 4,155,071 555,416 60,085 3,095,688 854,145 4,154,925 *-- GRP $38,487 9,704 54,030 8,119 136,566 109,649 21,679 4,163 144,555 23,151 6,849 41,147 1,650 51,048 81,609 1 i8,634 56,833 25,020 13,931 7,033 13,523 77,736 46,996 97.243 141,482 149,751 79,572 2,020 21,884 11,146 232,312 33,498 26,896 78,675 69,873 152,475 46,748 56,886 6,740,130 244,214 *- * - ºs- 137,185 96,192 974,245 425,860 448,333 $344,343 . 153,568 -*. 153,259 315,651 372,341 164,356 429,743 150,151 370,749 1,113,768 1,291,839 ; # WRP ERP EQIP CStP WHIP FRPP CŞecº AWEP GRP CBWP HFRP AMA al -- --- 6,263,258 52,459 -- - 222,883 * - 11,422 gº sº. , sº * 102,460 194 4,765,658 - 1,577,700 5,398,292 32,206 --- 4,698 -- *** 81,546 7,373,900 820,504 10,054,440 -- 1,836,463 2,814, 144 2,726,870 - 25,513 ºs- ºn- sº 11,799,862 2,930,106 19,059,155 183,999 1,100,044 5,354 3,996,125 cº-º- 137,213 ** dº tº **. 22,228,791 878,336 14,911,743 --- 989,322 1,035,497 1,707,254 - 83,830 - *** -º- 3,465,426 1,037,362 83,072,573 766,575 4,645,178 2,228,311 2,122,759 12,700,554 333,475 * * ºº: ** 115,637 28,676 22,033,577 46,354 813,507 920,238 3,552,303 * 35,281 ſº tºº. 789,886 1,522,200 98,142 9,382,773 -- 1,377,054 3,393,634 69,574 wº- 16,429 *** ** 273,955 464,346 946,884 13,494,147 - 865,616 1,789,543 1,433,097 -- 53,924 6,214,545 * tº gº 1,615,653 239,526 17,957,576 97,558 1,589,445 5,942,888 6,357,479 1,113 69,835 rº- ** - *** 296,400 , 240,029 8,117,883 -- 1,569,262 5,622,097 337,574 *- 32,868 1,419,044 cº- 474,978 25,533,535 1,909,715 21,549,863 272,652 1,274,223 1,519,574 5,431,376 -- 67,222 *- ºn- -- 2,136,911 177,459 15,321,538 101,868 874,069 3,866,047 2,388,953 *- 67,210 * ** 898,006 6,988,618 2,420,404 67,432,632 131,527 3,717,917 1,262,973 5,245,199 2,067,295 44,330,416 -- 62,381 escº 2,230,476 482,103 8,124, ió6 4-4- - * - 873,310 338,745 *- - -- ** -- - 2,829,092 - -- - 521,749 36,793 -- *r- tºº ** $435,711,313 $55,913,833 $1,054,581,563 $9,378,239 $72,742,931 $118,766,171 $276.004,481 $71,803.404 $47,658,102 $21,841,618 $2,526,172 $7,378,139 a/AMA actuals include only those AMA obligations made by NRCS. . 261 25g-42 COMMMODITY CREDIT CORPORATION | FOOD, CONSERVATION, AND ENERGY ACT OF 2008 WETLANDS RESERVE PROGRAM STATUS OF PROGRAM urrent Activities - ackground. The Wetlands Reserve Program (WRP) was authorized by Section 1237 of the Food ecurity Act of 1985 (P.L. 99-198), as amended by the Food, Agriculture, Conservation and Trade Act of 1990 (P.L. 101-624), the Federal Agriculture Improvement and Reform Act of 1996 (P.L. 104-127), the Farm Security and Rural Investment Act of 2002 (P.L. 107-171), and the Food, Conservation and Energy Act of 2008 (P.L. 110-246), to assist owners in restoring and protecting wetlands. WRP is a program funded by the Commodity Credit Corporation (CCC) and administered by the Natural Resources Conservation Service (NRCS). WRP is a voluntary program that provides technical and financial assistance to enable eligible landowners o address wetland, wildlife habitat, soil, water and related natural resource concerns on private lands in an invironmentally beneficial and cost effective manner. WRP supports three Mission Goals in the NRCS trategic Plan: Clean and Abundant water, Healthy Plant and Animal Communities, and Clean Air. The rogram achieves solutions to local community issues related to farms, ranches, rural lands and other areas y establishing easements and long-term agreements on eligible farmlands and establishing 30 year ontracts on Tribal lands. This unique program offers landowners an opportunity to establish, at minima ost, long-term conservation and wildlife habitat enhancement practices and protection. - rogram Goal. The goal of WRP is to achieve the greatest wetlands functions and values, along with ptimum wildlife habitat on every acre enrolled in the program. In WRP, at least 70 percent of the wetland dupland areas will be restored to the original natural condition to the extent practicable; the remaining #0 percent of the project area may be restored to other than natural conditions. For example, instead of estoring a bottomland hardwood site to all trees, a portion of the site could be restored to an emergent marsh condition if the landowner or NRCS wanted to create habitat for certain wildlife species. This lexibility allows NRCS to implement projects that meet landowner objectives and maximize wildlife Wenefits. WRP focuses on: • Enrolling marginal lands that have a history of crop failures or low production yields; Restoring and protecting wetland values on degraded wetlands; Maximizing wildlife benefits; Achieving cost-effective restoration with a priority on benefits to migratory birds; Protecting and improving water quality; and Reducing the impact of flood events. wn Scope and Eligibility Criteria. The program is available in all 50 States, the District of Columbia, the Commonwealth of Puerto Rico, Guam, the Virgin Islands of the United States, American amoa, the Commonwealth of the Northern Mariana Island, and the Trust Territories of the Pacific Islands n all lands meeting any of the following eligibility criteria: • Altered, cropped and grazed wetlands along with upland buffer areas; Rangeland and wooded areas where hydrology is degraded but restorable; Eligible acres already enrolled in the Conservation Reserve Program; Riparian areas linking protected wetlands; Natural wetlands that contribute to the value of the easement restoration area; and Wetlands restored under a Federal or State cost-share program with an easement or deed restriction with duration of less than 30 years. 262 25g-43 Program Enrollment Options. WRP provides landowners four methods to enroll acreage: • Permanent easements: Easement duration is in perpetuity. Landowners receive an easement payment after the easement is filed. The compensation is to be the lowest of the: o Fair market value of the land as determined by a Uniform Standards of Professional Appraisal Practices (USPAP) appraisal or an area-wide market analysis or survey; o Amount corresponding to the geographic rate cap, as determined by the Secretary of Agriculture in regulations; o Offer made by the landowner. In addition, NRCS shall share the cost of carrying out the establishment of conservation measure and practices, and the protection of wetland functions and values including necessary maintenan activities as set forth in the plan to the extent that the Secretary determines that cost-sharing is appropriate and in the public interest. • 30-year easements: Easement duration is 30 years. Landowners receive an easement payment after the easement is filed and is the equivalent of 75 percent of the value for a permanent easement and up to 75 percent of the eligible restoration costs. • Restoration cost-share agreements: Restoration cost-share agreements are made available to participating landowners as an alternative mechanism to restore wetlands, without requiring the landowner to enroll the land as an easement. Agreements are generally for a 10-year period, although longer agreement periods may be required for unique projects that are funded at a highe level. There is no easement payment; however, NRCS pays up to 75 percent of the eligible restoration costs. - r • 30-year contracts: Acreage owned by Indian Tribes can be enrolled through the use of a 30-ye contract which shall be equivalent in value to a 30-year easement. For both permanent and 30-year easements, WRP pays for all the costs associated with recording the easement in the local land records office including recording fees, charges for title abstracts, surveys, appraisal fees, “All Appropriate Inquiry” records searches, and title insurance associated with acquiring a easement. These costs are authorized for payment under Section 303 of the Uniform Relocation Assistan and Land Acquisition Policies Act of 1970. Technical Assistance. With input from State wildlife agencies and the U.S. Fish and Wildlife Service (FWS), NRCS develops a preliminary site plan for the offered acres that are initially determined to be eligible. The plan outlines the wetlands and any adjacent lands that would benefit from restoration in this program. Once the participant accepts an offer, NRCS assists in establishing the required practices for th ČáSement area. - NRCS continues to provide assistance to the landowner after the initial completion of the restoration activities. The assistance may be in the form of review of restoration measures, clarification of the technical and administrative aspects of easement and agreement management needs, and basic biological and engineering advice on how to achieve optimum results for wetland dependant wildlife. FY 2009 Contracts and Acres Enrolled Type of Project- - Contracts Enrolled Acres Enrolled 30-Year Agreements (With Tribes) 12 2,156 Restoration Cost Share Agreements 14 644. 30-Year Easements 399 51,690 Permanent Easements 684 124,642 Total - 1,109 - 179,132 WRP Acreage. NRCS created, restored, or enhanced 106,379 acres of wetlands in FY 2009. The averag project size for FY 2009 was 162 acres compared to 163 acres in FY 2008. Acreage offered for participation in the WRP varies in size across the country. Acres are the specific controlling factor for 263 RP. Funding needs are determined by projecting the number of acres by program option (i.e. permanent asements, 30-year easements, cost share agreements) and the geographic rate cap for the location of the lcres to be enrolled. umulative Enrollment Data (including FY 2009 and prior years) Acres enrolled 2,177,362 Acres of easements perfected 1,700,076 Acres with restoration cost-share agreements - 188,509 ſotal number of projects - 11,758 umber of easement projects 10,498 umber of restoration cost-share agreements 1,248 umber of 30 Year contracts with Indian Tribes enrolled 12 Acres of 30 Year contracts with Indian Tribes enrolled 2,156 ſhe cumulative “Acres Enrolled” in the chart above represents the total initial enrollment for the life of the Program less those projects that have been cancelled or terminated after the year of initial enrollment. e type of wetlands restored varies from floodplain forest, to prairie potholes, to coastal marshes. 'loodplain forests and associated sloughs and small emergent marsh wetlands account for the majority of he program's restoration activity. Most of the enrolled floodplain acres offered into the program occur in reas subject to frequent flooding that were originally drained or cleared for agricultural production. RCS continues to improve restoration techniques and knowledge. For example, over 65 percent of all estoration involved hydrology restoration, with or without a vegetative component. Of the acres involving vegetative component, improved techniques such as natural regeneration were used over 45 percent of the ime. This allows for the most natural wetland community possible, providing the greatest benefit to ssociated wetland dependant species, and resulted in NRCS utilizing the most cost effective techniques for omplete restoration. - - WRP Partnership Activities. In FY 2009, NRCS continued to expand partnership efforts with onservation entities. Ducks Unlimited, numerous State Wildlife Agencies, the Fish and Wildlife Service, alifornia Waterfowl Association, The Nature Conservancy, Wisconsin Waterfowl Association, and the ſississippi Fish and Wildlife Foundation supplemented NRCS capacity with additional restoration xpertise and implementation capability. Other groups contributing technical expertise to the delivery of VRP include the National Association of Conservation Districts, State associations of conservation istricts, U.S. Forest Service, local conservation districts and technical service providers. Ionitoring Initiative. NRCS is responsible for monitoring over 10,498 easements covering over 1.7 illion acres, annually for potential violations. RCS implemented a Remote Sensing Project through an agreement with the Farm Service Agency Aerial hotography Field Office to purchase high resolution aerial photography for WRP, Emergency Wetlands leserve Program, and Emergency Watershed Program-Floodplain easements. The project uses digitized asement boundaries supplied by States to fly over WRPeasements on an annual basis. Remote sensing ill supplement easement monitoring, enabling States to assess risk of violations and determine if dditional site visits are needed. Aerial photography was used to evaluate 3,207 WRPeasements in 2007, 720 easements in 2008, and 7,245 easements in 2009. - - giana. A representative of the Pokagon Band of the Potowatomi Indians in Indiana recently stated that e WRP is more than restoring wetlands – it is restoring the culture and the sacredness of the land back to e tribe. The Tribe has worked with NRCS to return the hydrology of 1,147 acres of their native land base ck to historic marsh conditions. Even more exciting to the Tribal members is the natural regeneration of tive plants such as Umbrella Sedge and the success they are having in re-establishing Wild Rice (a 264 25g-45 significant, traditional plant for the Tribe). As a result of the restoration work, Green Heron, the Great Blu Heron, egrets, osprey, wild turkeys, Indigo Buntings and butterflies have returned as well. Other partners on the project have included Pheasants Forever and the St. Joseph County Soil and Water Conservation District. Since 1997, NRCS and The Nature Conservancy have entered into a series of WRP agreements that have resulted in 5,100 acres of wetlands and prairie established in Newton County in northwest Indiana the Kankakee Sands. The conservation plans were designed to deliver high diversity re-creations of rare and declining habitats, such as sedge meadow, wet prairie, emergent wetland, and mesic prairie; habitats that are extremely rare not only in Indiana, but across the eastern Midwest and Great Plains. The results have been outstanding. The interplay of native wet and upland habitats has created a place for huge populations of amphibians, reptiles, mammals and birds. The site has been named a national Important Bird Area by Audubon, with large flocks of waterfowl, marsh birds, and grassland birds using the newly established habitat each year. Missouri. Southeast Missouri was home to thousands of acres of sand prairie, a unique habitat and plant community. Developing agriculture nearly destroyed the sand prairie habitat in this part of the State. The Splitbeard Bluestem Andropogon ternarius, used to flourish over Sandy riverine areas in southern and southeast Missouri. Where applicable, this special community is being restored on WRP sites in southeast Missouri. Splitbeard Bluestem was a major component of the sand prairie and had all but disappeared from the Southeast Missouri landscape, Illinois Chorus Frogs, a State species of conservation concern in Missouri i at home in sand prairies. The Eastern Spadefoot Toad is another amphibian that inhabits sand prairies in southeastern Missouri. They often burrow into the ground and prefer open fields with loose sandy soil. The spadefoot toad is also a State species of concern in Missouri. One WRP site in New Madrid County was planted to 65 acres of Splitbeard Bluestem in the spring of 200 Thirty acres was planted on another WRP site in close proximity in 2008 and is responding well to the recent wet weather and has become quite robust. These plantings are part of a WRP complex totaling 121 acres, a good place for the Splitbeard Bluestem, Illinois Chorus Frog, the Eastern Spadefoot Toad and many other riverine wetland wildlife species to take up residence. Rhode Island. After decades of degradation, construction is now completed to restore Gooseneck Cove i Newport, Rhode Island. Nearly 14 acres of salt marsh within the cove have been lost since 1939, and wat: quality and fish habitat have been severely degraded due to restricted tidal flow in this 64 acre coastal wetland. The project marks Rhode Island’s first intentional dam removal. While much work remains to be completed in restoring our State’s coastal habitats, this project will result in immediate positive ecologic, economic, and recreational effects. The restoration activities are directed at replacing culverts and the removal of the defunct dam in the cente of the wetland system. These barriers altered the natural flow of tides into and out of the marsh, causing marsh plants to die-off, and the surface of the marsh to erode and subside. This has led to decreased water quality, increased flooding, and the introduction of invasive vegetation. The restoration will improve wate quality and growing conditions for native marsh plants and improve habitat of the marsh and tidal creeks for commercial and recreational species of fish, such as striped bass, bluefish, and winter flounder; shellfish, waterfowl and shorebirds. It will also reduce flooding and make the marsh more resilient to stori damage and projected sea level rise impacts. Iowa. For the first time in more than a century trumpeter swans nested in Appanoose County, Iowa * in part to restored and enhanced wetlands and other habitat implemented under the Wetlands Reserve Program. The swans were released three years ago by the Iowa Department of Natural Resources. Trumpeter swans are the world's largest waterfowl, weighing from 25-35 pounds when fully grown. They nested throughout Iowa prior to settlement, but wetland draining and unregulated hunting brought their 265 25g-46 emise in the early 1880s. In 1993 the DNR developed a plan to restore trumpeter swans in Iowa. In 1998 ee cygnets hatched from a wild nesting trumpeter pair in Dubuque County. rumpeter swans form strong pair bonds that can last for years. They build their nests five feet across, hich are usually among aquatic plants. They will often use the tops of muskrat houses for a nest base. early 1,000 trumpeter swans have been released in Iowa since 1993. From 1998 to 2008, about 500 ygnets were reported hatched in Iowa. - ENVIRONMENTAL QUALITY INCENTIVES PROGRAM Current Activities - ackground. Section 2301 of the Farm Security and Rural Investment Act of 2002 (the 2002 Act) (P.L. 07-171, May 13, 2002) 16 U.S.C. 3839aa and Section 2503 of the Food, Conservation and Energy Act of 008 (P.L. 110-246) re-authorized and amended the Environmental Quality Incentives Program (EQIP), eated by the Food Security Act of 1985 (the 1985 Act) as amended by the Federal Agriculture rovement and Reform Act of 1996 (the 1996 Act) (P.L. 104-127, April 4, 1996) (16 U.S.C. 3839aa). e 1996 Act combined into a single program the functions of the Agricultural Conservation Program CP), the Great Plains Conservation Program (GPCP), the Water Quality Incentives Program (WQIP), d the Colorado River Basin Salinity Control Program (CRBSCP). NRCS implements EQIP and the sociated financial and performance reporting. The Commodity Credit Corporation (CCC) funds EQIP. rogram Operation. EQIP provides technical and financial assistance to eligible farmers, ranchers and mindustrial private forest owners to address soil, water, air, and related natural resource concerns on their ds in an environmentally beneficial and cost-effective manner. Overall, the program addresses and olves local conservation issues related to farms, ranches, nonindustrial private forest lands and rural lands. his is done through landowners and land users who implement conservation practices on eligible lands: • Conservation practice means one or more conservation improvements and activities, including structural practices, land management practices, vegetative practices, forest management practices, and other improvements that achieve the program purposes, including such items as CNMPs, agricultural energy management plans, dryland transition plans, forest management plans, integrated pest management, and other similar plans. • Structural practice means a conservation practice, including a vegetative practice, that involves establishing, constructing, or installing a site-specific measure to conserve and protect natural resources from degradation, or improves soil, water, air, or related natural resources in the most cost-effective manner. Examples include, but are not limited to, animal waste management facilities, terraces, grassed waterways, tailwater pits, livestock water developments, contour grass strips, filter strips, critical area plantings, tree plantings, establishment or improvement of wildlife habitat, and capping of abandoned wells. • Land management practices are primarily site-specific management techniques and methods to conserve, protect from degradation, or improve soil, water, or related natural resources in the most cost-effective manner. Land management practices include nutrient management, manure management, integrated pest or crop management, irrigation water management, residue management, stripcropping, contour farming, grazing management, and wildlife habitat management. - rogram Objectives. NRCS is charged with carrying out EQIP in a manner that optimizes environmental Frefits and provides: • Flexible technical and financial assistance to farmers and ranchers that face the most serious threats to soil, water, air, and related natural resources; - • Assistance to farmers and ranchers in complying with Federal, State, and local environmental regulatory requirements; - 266 25g-47 • Assistance to farmers and ranchers in making beneficial, cost-effective changes to cropping systems, grazing management, manure, nutrient, pest, or irrigation management, land uses, or other measures needed to conserve and improve soil, water, air, and related natural resources, an • For the consolidation and simplification of conservation planning and implementation to reduce the administration burden on producers. Land and Participant Eligibility Requirements. Lands enrolled in EQIP must be privately owned. Eligible lands may include agricultural land (i.e., cropland, rangeland, pasture, private non-industrial fore land and other land on which crops or livestock are produced), including agricultural land that poses a serious threat to soil, water, air, or related resources by reason of soil type, terrain, climatic conditions, topography, flooding, saline characteristics, or other natural resource factors or natural hazards. Publicly owned land is eligible when the land is under private control for the contract period, is included in the participant’s operating unit, and when the participant has written authorization from the government landowner to apply conservation practices. Installation of conservation practices and systems must contribute to an improvement in the identified natural resource concern. Participation is voluntary. In order to participate, both the land and the person(s) must be eligible. Eligibility requires that applicants must: • Comply with the highly erodible land and wetland conservation provisions of the Food Security Act of 1985; - • Have control of the land for the life of the proposed contract period; and • Have an interest in the farming operation. National Priorities. The 2002 and 2008 Farm Bills require that at least 60 percent of the funds for EQIP be targeted to livestock production conservation practices or systems. Livestock production includes botl confined and grazed livestock. Energy conservation is considered to be a part of all national priorities. After an extensive public-input effort, NRCS established the following national priorities: • Reduction of nonpoint source pollution (nutrients, sediment, pesticides, or excess salinity) in impaired watersheds consistent with Total Maximum Daily Loads as well as the reduction of groundwater contamination and reduction of point sources such as contamination from confined animal feeding operations; • Conservation of (the quantity of) ground and surface water resources; • Reduction of emissions particulate matter, nitrogen oxides (NO.), volatile organic compounds, a ozone precursors and depleters that contribute to air quality impairment violations of National Ambient Air Quality Standards; • Reduction in soil erosion and sedimentation from unacceptable levels on agricultural land; and • Promotion of at-risk species habitat conservation. Financial Assistance. • Conservation Payments: Under EQIP, the Secretary pays eligible program participants an amount n to exceed 75 percent of the incurred costs to implement one or more structural, vegetative, or land management practices and up to 100 percent of estimated foregone income. Estimated income foregone means an estimate of the net income loss associated with the adoption of a conservation practice, including from a change in land use or land taken out of production or the opportunity cost associated with the adoption of a conservation practice. This shall not include losses of income due t disaster or other events unrelated to the conservation practice. Limited resource farmers, beginning farmers, and land owners or operators that are socially disadvantaged are eligible to receive up to 90 percent payment rate. º * • Limitations on Payments: Total conservation payments are limited to $300,000 per individual or en during any six-year period, regardless of the number of farms or contracts. Beginning in FY 2009, I individual/entity may receive EQIP payments in any crop year in which the individual/entity’s avera 267 25g-48 adjusted gross income for the preceding three years exceeds $1 million; unless 67 percent of that income is from farming, ranching, or forestry interests. - Conservation Plan. With NRCS or certified technical service providers’ (TSPs) assistance, a participant evelops a conservation plan for the offered acres initially determined eligible. The plan specifies the ethod in which the planned conservation practices and systems on the enrolled acres will be implemented, perated, and maintained. This plan is the basis for the EQIP contract. QIP Contract and Contract Modifications. The CCC provides funding for practice payments to apply eeded and approved conservation practices and systems and land use adjustments within a time schedule specified by the conservation plan. EQIP contracts may be modified to increase funds provided the increased cost is the result of a valid contract modification within the original contract scope and intent. One example of an appropriate modification would be the adoption of a State law requiring a liner in a waste storage facility after the EQIP contract and cost estimate was prepared. The original intent was to install a waste storage facility and the facility must meet all Federal, State, and local regulations in order for NRCS to approve its construction. The contract would need to be modified to meet the new State regulation in order to install the originally contracted waste storage facility. All modifications are reviewed ind approved according to authorities designated to the State Conservationist. Technical Assistance and Partnerships. Producers receive technical assistance from NRCS or approved TSPs to develop the conservation plan and establish required practices for lands accepted into EQIP. EQIP Somplements many State and local programs in addressing specific local conservation and natural resource |SSUICS, Partnership efforts have been forged with Federal, State, and local entities, including the National Association of Conservation Districts, State Associations of Conservation Districts, and local conservation listricts in efforts to deliver a program beneficial to program participants and the environment. NRCS :ooperates with Federal, State, and local partners to address local and national conservation issues. Through interactive communication between the local community, local interest groups, and State and Federal agencies, the partnership provides the entities with information and resources needed to address ocal priorities and implement State and national programs, such as EQIP. Selected Examples of Recent Progress. FY 2009 EQIP funding to States was $1.067 billion. An !stimated 12 million acres will be treated through EQIP contracts funded in FY 2010. Fiscal Year 2009 EQIP Program Demands' State Total Number | Unfunded Valid Average Estimated Applications of Valid Applications | Contract $ Unfunded Contracts | Applications Funded Applications Percent ALABAMA 3,673 1,199 1,678 41.68 $10,320 $17,317,725 ALASKA - 68 48 17 73.85 89,274 1,517,662 ARIZONA 606 174 326 34.8 97.219 31,693,417 ARKANSAS 2,120 88.1 779 53.07 15,721 12,246,628 CALIFORNIA 6,832 1,743 3,853 31, 15 32,750 126,184,541 COLORADO 2,013 766 806 48.73 30,876 24,885,704 CONNECTICUT 150 77 44 63.64 61,334 2,698,692 DELAWARE 706 138 270 33.82 40,309 10,883,347 FLORIDA 1,901 364 980 27.08 45,198 44,294,339 268 25g-49 State Total Number Unfunded Vaid Average Estimated T Applications of Valid Applications Contract $ Unfunded Contracts i Applications Funded - Applications Percent ſº- GEORGEA 4,306 1,129 2,516 30,97 13,058 32,853,691 HAWAII 342 176 80 68.75 38,158 3,052,637 HDAHO 1,383 261 763 25.49 41,449 31,625,551 H.LINOHS 1,767 1,028 S64 64.57 11,013 3,211,243 INDIANA 1,405 686 482 58.73 16,385 7,897,565 HOWA 4,163 1,227 2,101 36.87 16,416 34,490,478 KANSAS 3,002 874 1,408 38.3 21,679 30,523,662 KENTUCKY 3,403 556 1,554 26.35 18,716 29,085,396 LOUISIANA 2,667 826 1,406 37.01 18,642 26,211,226 MAINE 813 289 465 38.33 30,305 14,092,023 MARYLAND 663 268 157 63.06 25,448 3,995,410 MASSACHUSETTS 540 136 307 30.7 37,658 11,560,866 MICHIGAN 938 306 567 35.05 49,009 27,788,265 MINNESOTA 1,873 1,142 479 70.45 23,166 11,096,310 MISSISSIPPI 4,670 1,684 1,317 56.11 7,071 9,312,299 MISSOURI 4,519 1,006 2,435 29.24 17,679 43,047,610 MONTANA 2,645 637 1,215 34.4 33,232 40,376,782 NEBRASKA - 5,107 957 2,844 25.38 22,391 63,009,43 NEVADA 292 79 108 42.25 75,824 8,189,015 NEW HAMPSHIRE 430 276 136 65.99 16,228 2,207,065 NEW JERSEY 433 108 229 32.05 42,911 9,826,560 NEW MEXICO 1,760 423 903 31.9 41,302 37,295,705 NEW YORK 1,653 364 1,068 25.42 36,665 39,158,038 NORTH CAROLINA 1,863 442 1,034 29.95 31,044 32,099,187 NORTH DAKOTA 2,706 751 1,453 34.07 26,456 38,441,004 OHIO 2,764 929 1,448 39.08 15,805 22,885,744 OKLAHOMA 6,359 1,094 4,063 21.21 19,002 77,205,284 OREGON 1,302 396 698 36.2 28,497 19,890,647 PENNSYLVANIA 3,059 342 2,001 14.6 37,314 74,665,929 RHODE ISLAND 198 75 114 39.68 45,352 5,170,097 SOUTH CAROLINA 1,488 264 817 24.42 28,181 23,024, 194 SOUTH FDAKOTA 1,584 626 713 46.75 22,562 16,086,402 TENNESSEE 2,721 984 945 5}.01 11,555 10,919,423 TEXAS 8,695 3,063 3,944 43.71 20,889 82,384,306 |UTAH 1,724 327 1,035 24.01 44,838 46,407,472 VERMONT 594 198 260 43.23 34,595 8,994,67] VIRGINHA 1,048 322 473 40.5 32,355 15,303,824 WASHINGTON 1,682 367 1,026 26,35 36,707 37,661,017 269 25g-50 State Total Number TUnfunded Valid Average Estimated Applications of Valid Applications | Contract $ Unfunded Contracts | Applications Funded Applications º - Percent - WESTVIRGINIA 1,405 209 972 17.7 27,134 26,374,691 WISCONSIN 2,372 1,052 868 54.79 15,546 13,494,215 WYOMING 1,094 411 484 45.92 26,540 12,845,294 PUERTO RICO 576 280 154 64.52 15,535 2,392,325 Total: 110,077 31,960 54,329 37.04% $22,875 $1,360,874,608 Source: Protracts as of September 30, 2009. Unfunded applications include pre-approved, deferred, eligible, pending, and disapproved. Total contract average is based on national totals listed. ificant EOIP Accomplishments - Conservation Innovation Grants. Conservation Innovation Grants (CIG) is a voluntary program intended to stimulate the development and adoption of innovative conservation approaches and technologies while leveraging Federal investment in environmental enhancement and protection, in conjunction with agricultural production. CIG was authorized under EQIP in the 2002 Farm Bill. Under CIG, competitive grants are awarded to eligible entities, including State and local agencies, non- governmental organizations, Tribes, or individuals. CIG enables NRCS to work with other public and private entities to accelerate technology transfer and adoption of promising technologies and approaches to address some of the Nation's most pressing natural resource concerns. CIG will benefit agricultural producers by providing more options for environmental enhancement and compliance with Federal, State, and local regulations. In FY 2009, CIG was implemented with three components: National, Chesapeake Bay Watershed, and State. The grants will stimulate the development and adoption of innovative technologies and approaches through pilot projects and conservation field trials. CIG awarded projects address a broad range of natural resource concerns, including nutrient management, water conservation, air quality, grazing land and forest health, and on-farm energy efficiency. The components were awarded as follows: • National: Over $14.1 million awarded to recipients in 39 States. • Chesapeake Bay Watershed: Over $2.1 million awarded to three recipients in three States. • Grant Leveraging: Over $2.2 million awarded to two recipients in one State, and the Caribbean. - *ther Significant Accomplishments Beginning, Limited Resource, and Socially Disadvantaged Farmers and Ranchers. NRCS approved 4,049 beginning farmers and ranchers for EQIP contracts totaling over $112 million. NRCS also approved 1,034 limited resource farmers and ranchers for EQIP contracts totaling $23.8 million. NRCS approved 35 percent of the applications received from potential limited resource producers for three percent of the EQIP funding,36 percent of the applications for beginning farmers and ranchers for a total of 15 percent of the total EQIP funds and 29 percent of the applications for the socially disadvantaged for a total of six percent of the total EQIP funds. Total funding for all three groups accounted for 24 percent of the total EQIP funding. - EQIP on American Indian and Alaska Native Lands. NRCS approved 503 American Indian and Alaska Native EQIP contracts that are valued at over $22.6 million and, when completed, will assist American Indians and Alaska Natives treat over 1.7 million acres. NRCS approved Conservation Innovation Grants with the College of Menominee Nation Wisconsin for $122,973. The purpose is to 270 25g-51 demonstrate the viability of carbon sequestration as a market mechanism tool for promoting environmental preservation, biodiversity, conservation, and sustainable development among Tribes at their lands. • Market-based Approaches through the Conservation Innovation Grants. NRCS awarded more than $972,973 to 3 projects in 3 states to implement an array of market based approaches that promote conservation. The results of these projects will be incorporated into NRCS’ technology transfer tools (practice standards, field handbooks, guidance documents, etc.). An example is: Food Alliance will partner with the Pennsylvania Association for Sustainable Agriculture (PASA) to introduce a highly successful sustainable agriculture certification program in Pennsylvania, and improve water quality NRCS awarded one Conservation Innovation Grants to Tribal entities in FY 2009: quality in the Chesapeake Bay watershed. The purpose of the project is to replicate a successful market incentive fo conservation to promote improvements in management of agricultural lands in Pennsylvania to benef water quality in the Chesapeake Bay watershed. • Technical Service Providers (TSP). NRCS obligated $16.8 million in EQIP for TSPs in FY 2009. Each State was allocated funding for TSPs from their technical assistance funds to implement this effort. Many States exceeded the allocated amount to involve more TSP assistance. Selected Examples of Recent Progress - Nebraska — Transition to Organic Agriculture. NRCS in Nebraska has worked with the Nebraska Environmental Trust and Resource Conservation and Development areas to establish a Statewide organic agricultural project. NRCS has assisted producers interested in transitioning to organic agriculture with financial assistance through EQIP for installing approved conservation practices. Georgia – Organic Initiative. Georgia currently ranks 42* in the Nation in total acres of land under Certified Organic Operation with approximately 62 producers. When over $1 million was allocated to Georgia for the EQIP Organic Initiative there was concern that these funds could not be utilized. After a aggressive outreach effort by the local field staff, all the allocated funds were utilized with the approval o 53 contracts. The Organic Initiative not only resulted in financial assistance to the producers, it also gave the Georgia NRCS personnel an opportunity to reach out to agricultural producers that traditionally have not utilized the services provided by the Agency. New Jersey - Farmers and New Jersey Audubon Partner for Birds. Thanks to an historic partnershi a direct farm-to-market link has been established that offers locally grown birdseed through New Jersey Audubon Society nature centers. With support from a Conservation Innovation Grant from the Natural Resources Conservation Service, New Jersey farmers are working with New Jersey Audubon Society to grow a "greener", more environmentally friendly black-oil sunflower seed. This "bird-friendly" seed is th first birdseed certified as "Jersey Grown" by the New Jersey Department of Agriculture. The supply of “Jersey Grown” birdseed quickly ran out in the first year of the project; the farmers involved expanded their acreage in 2009 to meet the demand while devoting additional land to warm season grass habitat for ground nesting birds. The project demonstrates that locally grown agricultural products can complement habitat and soil conservation practices while achieving economic viability. California — Pollinator Habitat Development. California apiaries are once again faced with a shortage bees this year. As such it is increasingly important to California's economy and ecology to explore supplemental means of pollination. The Natural Resources Conservation Service has partnered with the Xerces Society for Invertebrate Conservation, the Audubon California and the University of California, Berkeley to use funding from the Environmental Quality Incentives Program to assist landowners with establishing habitats to attract and maintain populations of wild pollinators such as bees, butterflies and moths. Not only could these pollinators potentially reduce the need for managed colonies and alleviate th stress on the producers who depend upon them, but in creating areas that attract wild pollinators, landowners also diversify and enhance their land’s ecosystem. 271 25g-52 Iowa - Solar Power Helps Dairy Grazing Management. A southeast Iowa dairy farmer installed a solar- powered pump system to water 140 head of cattle on his 236-acre rotational grazing system with assistance through EQIP, Solar panels convert sunshine to electricity and power a submersible pump which sends pond water up a hill to a 4,000-gallon tank. The tank uses gravity throughout the underground piping system to water the cattle in each paddock. “The solar powered pump system works very well,” said the producer. “NRCS provided financial assistance through EQIP, the tax code gave us a tax credit, and we are saving $150 a month on our rural water bill.” New Mexico – Indian Reservation. An unnaturally large amount of prickly cholla cactus on one of New Mexico’s Indian reservations has been cleared with the assistance of the EQIP, allowing the land to begin restoring a natural plant community rich in native grasses. With continued efforts to keep the cactus under control, the land can once again be utilized by cattle and wildlife for grazing. Because of the abundance of archeological sites, the clearing was carefully planned and tracked. A dozer with a rake attachment covered the land, and clipped the collar at the base, similar to how a tree would be cut. The Bureau of Indian Affairs restricted the dozer from many small areas to protect the archeological sites from disturbances. - - * AGRICULTURAL water ENHANCEMENT PROGRAM Current Activities . Background. Section 2510 of the Food, Conservation, and Energy Act of 2008 (the 2008 Act) (P.L. 110- 246) established the Agricultural Water Enhancement Program (AWEP) by amending section 1240I of the Food Security Act of 1985, as amended by the Federal Agriculture Improvement and Reform Act of 1996 . (P.L. 104-127, April 4, 1996) (the 1996 Act) (16 U.S.C. 3839aa) as amended by Section 2301 of the Farm Security and Rural Investment Act of 2002 (the 2002 Act) (P.L. 107-171, May 13, 2002) (16 U.S.C. - 3839aa). The Natural Resources Conservation Service (NRCS) implements AWEP and the associated financial and performance reporting. The Commodity Credit Corporation (CCC) funds AWEP. Program Operation. AWEP is a voluntary conservation program that provides financial and technical assistance to agricultural producers to implement agricultural water enhancement activities on agricultural land for the purposes of conserving surface and ground water and improving water quality. As part of the Environmental Quality Incentives Program (EQIP), AWEP operates through contracts with producers to plan and implement conservation practices to conserve ground and surface water and improve water quality in project areas established through partnership agreements. As authorized by Congress, this is not a grant program to eligible partners. This is a program whereby eligible partners will enter into multi-year agreements with NRCS to promote ground and surface water conservation, or improve water quality on eligible agricultural lands. The intent of AWEP is for the Federal government to leverage investment in natural resources conservation along with services and resources of other eligible partners. Individual producers are not eligible to submit a partnership proposal. Potential partners submit proposals that contain the information set forth in “Proposal Requirements” to receive consideration for entering into partnership agreements as outlined in a Notice of Request for Proposals which is published annually in the Federal Register. Entities that are eligible to enter into AWEP partnership agreements include: Federally recognized Indian Tribes, States, units of local government, agricultural or silvicultural associations, or other groups of such producers, such as an irrigation association, agricultural land trust, or other non-governmental organization that has experience working with agricultural producers. - - After an AWEP project proposal has been approved by the NRCS Chief, the program provides technical and financial assistance to eligible farmers, ranchers and non-industrial private forest owners to address water conservation and water quality related natural resource concerns on their lands in an environmentally beneficial and cost-effective manner. Overall, the program addresses and solves water conservation and 272 25g-53 quality issues related to farms, ranches, nonindustrial private forest lands and rural lands. This is done through landowners and land users who implement conservation practices on eligible lands: Conservation practice means one or more conservation improvements and activities, including structural practices, land management practices, vegetative practices, forest management practices, and other improvements that are planned and applied according to NRCS standards and specifications. Program Objectives. NRCS is charged with carrying out AWEP in a manner that optimizes environmental benefits and provides for carrying out the following activities with respect to agricultural land: Water quality or water conservation plan development, including resource condition assessment and modeling. Water conservation restoration or enhancement projects, including conversion to the production of less water-intensive agricultural commodities or dryland farming. Water quality or quantity restoration or enhancement projects. Irrigation system improvement and irrigation efficiency enhancement. Activities designed to mitigate the effects of drought. Related activities that the Secretary of Agriculture determines will help achieve water quality or water conservation benefits on agricultural land. - Land and Participant Eligibility Requirements. The following land is eligible for enrollment in the AWEP through program contracts with producers: Ö Private agricultural land: - For agricultural lands not irrigated for two of the previous five years, the construction, improvement, or maintenance of irrigation ponds, small on-farm reservoirs, or other agricultural water impoundment structures, which are designed to capture surface water runoff, are eligible only in an area that is experiencing or has experienced exceptional drought conditions between June 18, 2006 and June 18, 2008. - Indian land; and . Publicly owned land where: - o The conservation practices to be implemented on the public land are necessary and will contribute to an improvement in the identified resource concern; o The land is a working component of the participant’s agricultural and forestry operation; and o The participant has control of the land for the term of the contract. National Priorities. NRCS will evaluate and give priority to proposals that: Include high percentages of agricultural land and producers in a region or other appropriate area; Result in high levels of applied agricultural water quality and water conservation activities; Significantly enhance agricultural activity; Allow for monitoring and evaluation; Assist agricultural producers in meeting a regulatory requirement that reduces the economic scope of the producer’s operation; Achieve the project’s land and water treatment objectives within five years or less; For proposals from States with water quantity concerns, the Chief will give higher priority to projects from States where the proposal will: + o Include conservation practices which support the conversion of agricultural land from irrigated farming to dryland farming; + o Leverage Federal funds provided under the program with funds provided by partners; 273 25g-54 o Assist producers in States with high priority water quantity concerns, as determined by the Chief. The high priority areas are located in the following regions: Eastern Snake Plain Aquifer, Puget Sound, Ogallala Aquifer, Sacramento River Watershed, Upper Mississippi River Basin, Red River of the North Basin, or Everglades. - Financial Assistance. • Conservation Payments: Eligible program participants can receive a payment amount not to exceed 75 percent of the incurred costs to implement one or more structural, vegetative, or land management practices and up to 100 percent of estimated foregone income. Estimated income foregone means an estimate of the net income loss associated with the adoption of a conservation practice, including from a change in land use or land taken out of production or the opportunity cost associated with the adoption of a conservation practice. This shall not include losses of income due to disaster or other events unrelated to the conservation practice. Limited resource farmers, beginning farmers, and land owners or operators that are socially disadvantaged are eligible to receive up to 90 percent of the payment rate. - • Limitations on Payments: Total conservation payments are limited to $300,000 per individual or entity during any six-year period, regardless of the number of farms or contracts. Beginning in FY 2009, no individual/entity may receive AWEP payments in any crop year in which the individual/entity’s average adjusted gross income for the preceding three years exceeds $1 million unless two-thirds of that income is from farming, ranching, or forestry interests. - Conservation Plan. With NRCS or approved technical service providers’ (TSPs) assistance, a participant develops an AWEP plan for the offered acres initially determined eligible. The plan specifies the method in which the planned conservation practices and systems on the enrolled acres will be implemented, operated, and maintained. This plan is the basis for the AWEP contract, AWEP Contract and Contract Modifications. The CCC provides funding for payments to apply needed and approved conservation practices and systems and land use adjustments within a time schedule specified by the conservation plan. AWEP contracts may be modified to increase funds provided the increased cost is the result of a valid contract modification within the original contract scope and intent. One example of an appropriate modification would be the adoption of a State law requiring a liner in a waste storage facility after the AWEP contract and cost estimate was prepared. The original intent was to install a waste storage facility and the facility must meet all Federal, State, and local regulations in order for NRCS to approve its construction. The contract would need to be modified to meet the new State regulation in order to install the originally contracted waste storage facility. All modifications are reviewed and approved according to authorities designated to the State Conservationist. Technical Assistance and Partnerships. Producers receive technical assistance from NRCS or certified TSPs to develop the conservation plan and establish required practices for lands accepted into AWEP. AWEP complements many State and local programs in addressing water conservation and water quality issues. Partnership efforts have been forged with Federal, State, and local entities, including the National Association of Conservation Districts, State Associations of Conservation Districts, and local conservation districts in efforts to deliver a program beneficial to program participants and the environment. NRCS cooperates with Federal, State, and local partners to address local and national conservation issues. Through interactive communication between the local community, local interest groups, and State and Federal agencies, the partnership provides the entities with information and resources needed to address local priorities and implement State and national programs, such as AWEP. Selected Examples of Recent Progress. FY 2009 AWEP funding to States was $58 million. An estimated 488,380 million acres will be treated through AWEP contracts funded in FY 2009. 274 25g-55 Fiscal Year 2009 AWEP Program Demands' state Total Number Unfunded Valid Average Estimated Applications of Valid Applications Contract $ Unfunded Contracts Applications Funded Applications - Percent ALABAMA 201 23 115 - 17 $68,589 $7,887,735 ARKANSAS 26 17 0 100 19,753 0 CALIFORNHA 890 555 86 87 32,480 2,793,267 COLORADO 7 6 () 100 53,354 () FLORIDA 139 3} 38 45 37,586 1,428,285 GEORGIA 576 263 284 48 7,157 2,032,544 HDAHO 88 61 0 100 113,185 {} ILLINOHS 8 8 0 100 6,882 {} INDIANA 43 25 13 66 20,255 263,314 FOWA 12 10 1 91 15,883 15,883 MAINE 2 0 () {) N/A {} MICHHGAN 78 30 2 94 49,474 98.949 MINNESOTA 12 9 25 26 30,809 770,228 MISSISSIPPI 298 123 () 100 18,663 {} MONTANA 11 0 {) 0 N/A 0 NEBRASKA 703 82 412 17 34,288 14,126,827 NEVADA 1 0 0 0 N/A {} NEW JERSEY 7 6 {} 100 15,044 - {} NEW MEXICO 115 35 41 46 104,601 4,288,652 NEW YORK 5 3 3 50 180,851 542,553 NORTH CAROLINA 43 13 2 it 87 4,010 8,020 NORTH DAKOTA 110 90 6 94 29,504 177,021 OKLAHOMA 30 13 #6 45 56,915 910,636 OREGON 94 59 5 92 62,378 311,888 PENNSYLVANLA f {} {} 0 N/A 0 TEXAS 383 225 106 68 46,624 4,942,107 VIRGINHA 1 0 () 0 N/A 0 WASHINGTON f 0. 0 () N/A 0. Total” 3,886 1,687 1,155 59 $45,831 $40,597,909 | Source: Protracts as of October 2, 2009. Unfunded applications include pre-approved, deferred, eligible, pending, and disapproved. - - * Total contract average is based on national totals listed. Significant AWEP Accomplishments. {e This is the first year AWEP has been implemented. Out of 193 proposals submitted for national competition, 63 were approved. Nearly $58 million in 1,687 contracts were approved for producers who agreed to implement practices which address surface and ground water conservation and to address water quality projects. - • Six project areas involved Tribes and two projects were multi-State in scope. Twenty-four projects were approved in the special priority areas. 275 WILDLIFE HABITAT INCENTIVE PROGRAM Current Activities Background. Section 1240N of the Food Security Act of 1985, as amended by 2502 of the Farm Security and Rural Investment Act of 2002 (P.L. 107-171) (16 U.S.C. 3839bb-1), as amended by section 2602 of the Food, Conservation, and Energy Act of 2008 (P.L. 110–246) reauthorized the Wildlife Habitat Incentive Program (WHIP) to improve wildlife habitat in our Nation. NRCS administers WHIP. The purpose of the program is to help participants develop fish and wildlife habitat on private agricultural land, nonindustrial private forest land, and Indian land. Although the primary purpose is wildlife habitat development and enhancement, the benefits are not limited to wildlife. The practices are often compatible with and beneficial to farming and ranching enterprises. Some practices enhance farm profitability by improving grazing conditions, reducing management expenses, and by producing non-crop income from the lease of rights to harvest and observe wild game and fish. WHIP has been used to control invasive species, re-establish native vegetation, manage non-industrial forestland, stabilize streambanks, protect, restore, develop or enhance unique habitats, and remove barriers that impede migration of certain wildlife species. - WHIP is a voluntary program that provides technical and financial assistance to enable eligible participants to develop upland wildlife, wetland wildlife, threatened and endangered species, fish and other types of wildlife habitat in an environmentally beneficial and cost effective manner. WHIP supports NRCS’ Mission Goal of Healthy Plants and Animals. - - f National Priorities. For FY 2009 national priorities were to: • Promote the restoration of declining or important native fish and wildlife habitats. • Protect, restore, develop or enhance fish and wildlife habitat of at-risk species. • Reduce the impacts of invasive species on fish and wildlife habitats. • Protect, restore, develop, or enhance declining or important aquatic wildlife species’ habitats. Eligibility Criteria. To be eligible for WHIP, the land must be private agricultural land, nonindustrial private forest land, or Indian land. - WHIP State Wildlife Plans Updated. NRCS updated WHIP plans in each State to reflect FY 2009 WHIP national priorities, the recent NRCS Strategic Plan, and to ensure wildlife needs are comprehensively addressed. A key reference in the NRCS WHIP plan update was State government wildlife action plans that State wildlife agencies updated in FY 2009. Together, these Federal and State plans help identify high value and important habitats and focus funding on projects to conserve and restore them, Program Operation. - • States Set Wildlife Priorities. NRCS works at the local level and with the State Technical Committee to establish wildlife priorities. This process allows for local input as well as the coordination of wildlife priorities with other wildlife interests in the State and encourages the leveraging of other State, Federal, and private dollars to address State and local wildlife priorities. States generally select two to six priority habitat types; States have consistently included one or more upland and riparian habitats. A number of States identified wetlands, aquatic in-stream habitat, and other unique wildlife habitat such as caves and salt marshes as priorities. • Wildlife Habitat Plan. NRCS and its partners provide program participants with an assessment of wildlife habitat conditions, recommendations for practices to improve these habitat conditions, and a plan that incorporates practices and strategies for maximizing habitat for target species. This WHIP Plan of Operations (WPO), is the basis of the agreement between NRCS and the participant. • Cost-Share Agreements. The WPO identifies the cost-share practices that will be installed and the operation and maintenance requirements for the life of the agreement. Agreements usually last from 276 25g-57 one to ten years. WHIP provides additional cost-share to landowners who enter into 15-year or longer agreements to protect and restore high value and essential plant and animal habitat. • Implementation Assistance. NRCS helps program participants with technical and financial assistance to install any eligible practice NRCS determines is primarily for the development of prioritized wildlife habitat. NRCS provides up to 75 percent of the cost of installing these WPO practices (native grassland seeding, prescribed burns, hardwood planting, fish passage structure installation, etc). • Partners Play Significant Role. In addition to providing technical assistance, partners provide financial assistance through additional cost-share dollars, supplying equipment, or installing practices for the participant. This emphasis placed on partners in WHIP has improved communication and coordination among various interests addressing wildlife concerns. The partners who play an essential part of the success of the program include public agencies, non-profit organization partners, and Technical Service Providers. Accomplishments. In FY 2009, NRCS enrolled over 3,700 agreements on over 800,000 acres. The value of the contracts was almost $52 million. The average agreement size is 219 acres. There were 54 contracts valued at over $3 million with American Indian and Alaska Native Lands. On average, NRCS agreed to reimburse participants approximately $14,000 for each long-term agreement. Since the program began in 1998, national enrollment includes a total of almost 33,000 agreements on over 5.5 million acres. NRCS provided over $58 million in financial assistance from the Commodity Credit Corporation for FY 2009. Benefits. Of the total acreage enrolled in FY 2009, one percent will benefit threatened and endangered species. Threatened and endangered species targeted through WHIP include, but are not limited to, the following: American-burying beetle, Neosho madtom, Topeka shiner, gray bat, kit fox, black-tailed prairie dog, bog turtle, gopher tortoise, dusky-gopher frog, eastern-indigo snake, southern-hognose snake, black- pine Snake, Louisiana-black bear, red-cockaded woodpeckers, Mississippi-sandhill crane, Florida panther, wood storks, snail kites, Florida sandhill crane, caracara, grasshopper sparrow, Snake River-Chinook salmon, Umpqua River-cutthroat trout, coho salmon, steelhead, bulltrout, Lahontan-cutthroat trout, Yuma- clapper rails, Sonoran pronghorn, Mexican voles, lesser long-nosed bats, and Atlantic Salmon. Nationally, WHIP acres were distributed among the following three major habitat types and declining Species: - • Upland Wildlife Habitat. Of the total FY 2009 acres enrolled, over 98 percent encompassed upland wildlife habitat including grasslands, shrub/scrub, and forests. Several types of early succession grasslands, such as tall grass prairies, have declined more than 98 percent according to a 1995 U.S. Fish and Wildlife Service Report. One primary focus of WHIP nationally is the restoration of these scarce areas. Wildlife dependent on native grasslands includes neo-tropical migratory birds, waterfowl, amphibians, reptiles and many mammals. Specific species that will benefit from re- establishment of grasslands in one or more States include grasshopper sparrow, bobwhite quail, swift fox, short-eared owl, Karner-blue butterfly, gopher tortoise, western-harvest mouse, Gunnison-sage grouse, and Greater sage grouse. - Other upland priorities include the establishment of windbreaks, and the improvement of the edge around cropland, wildlife corridors, shrub-scrub and steppe habitats, and forests including pine barrens and long leaf pine. Wildlife species that will benefit from development of these habitats include Louisiana black bear, eastern collared lizard, Bachman’s sparrow, ovenbird, acorn woodpecker, western grey-squirrel and greater sage grouse. Practices installed on upland habitat include seedings and plantings, fencing, livestock management, prescribed burning, and shrub thickets with shelterbelts. Additional practices were installed for the benefit of forest land management including creation of forest openings, disking or mowing including meander disking through woodlands, woody cover control, brush management, upland wildlife management, aspen stand regeneration, and exclusion offeral animals. • Wetland Wildlife Habitat. More than 1.8 percent of WHIP lands benefit wetland habitat. WHIP wetland acres are not eligible for the Wetlands Reserve Program. WHIP wetland habitat includes crop 277 25g-58 fields that are flooded in the winter for waterfowl, tidal flushing areas, salt marshes, wetland hardwood hammocks, mangrove forests, and wild-rice beds. WHIP wetland habitat also includes created wetlands, freshwater marshes, and vernal pools in abandoned gravel mines. Among the wildlife species that will benefit from development or enhancement of wetland habitat are black crowned night heron, snowy egret, canvasback duck, ibis, piping plover, short-nosed sturgeon, osprey, California- clapper rail, fairy shrimp, Santa Cruz long-toed salamander, and endangered waterbirds. • Riparian and In-stream Aquatic Wildlife Habitat. Riparian habitat makes up almost one-half of one percent of the acres enrolled in FY 2009. This category includes riparian areas along streams, rivers, lakes, sloughs and coastal areas. Over 3,000 acres of riparian herbaceous cover, shallow water management for wildlife, and over stream habitat improvement and management were installed. Selected Examples of Recent Progress Wisconsin - Wildlife habitat restoration of a stream. This project included many habitat structures installed to benefit reptiles, amphibians, and non-game fish, which also included a shallow wetland scrape restoration and a prairie planting. Partners for this effort included Federal and State agencies, nonprofits, and private organizations. Prior to the project, flooding had significantly altered the stream by moving thousands of yards of rock bed load, road base, and hillside materials. Integrated bank stabilization and thousands of feet of bank shaping were installed to rehabilitate eroding stream corners. Various practices were installed in the creek such as cross-channel logs, vortex weirs and sets of boulder retards for the benefit of all fish species and turtles such as the Wood and Blandings which are both threatened turtle species. Many small backwater pockets were created and serve as tremendous recruitment areas for reptiles and amphibians and act as a refuge for the young of these species and several types of minnows from the predatory waters of the main stream. A snake hibernaculum was created as an over-wintering den for snake species such as garter, common water, western fox and milk. This stream is now one of the coldest, cleanest flowing streams in southwestern Wisconsin. Alabama - Turning a creek clear while increasing the agricultural productivity and wildlife habitat of a farm. A tributary to the Tennessee River was designated as unsuitable for fish and wildlife as a result of tons of manure caused by years of a congregation of cattle. The Tennessee River is a source of drinking water for millions. With the goal of achieving clean water, a number of agencies and non-government organizations utilized a number of programs to filter sediment and nutrients by seeding with pasture mixes, fencing out the stream and creating buffers, planting trees, and implementing intensive rotational grazing with the creation of paddocks. Conservation practices were also installed where cattle congregate, such as water troughs and feedlot areas. Distance to water troughs was calculated to control cattle walking - distances. A shallow water habitat was developed for wintering waterfowl such as ducks and geese, big blue heron, great egret, and the tricolored heron. Every drop of rain that falls on the farm goes through some type of treatment before it gets into the stream that ultimately runs into the Tennessee River. All work completed on this farm was voluntary. Not only did this work conserve the soil and water, but it will also increase the livestock production. With the improvement of water quality there is the possibility that three endangered mussels may return to this tributary because they are known to occur in this area. They are the pink mucket pearly mussel (Lampsillis abrupta), ring pink mussel (Obovaria refusa), and the rough pigtoe mussel (Pleurobema plenum). This would be a wonderful award for this farm in Alabama. New Hampshire - Removal of a dam. A dam built in 1957 and owned by a State agency was removed in 2009. This project, funded in 2007 under the 2002 Farm Bill, included the involvement of a number of government agencies and non-government organizations. Removal of the dam reconnected 39 miles of riverine corridor providing many practical benefits for wildlife and the surrounding estuaries. The dam’s removal allows diadromous fish, fish that survive in both fresh and salt water such as American eel, rainbow smelt and river herring, to travel up the river to reproduce in spawning and nursery grounds. The dam’s removal is also anticipated to improve the water quality by restoring it to a tidal river system. 278 25g-59 FARMAND RANCH LANDS PROTECTION PROGRAM Current Activities Background. The Food, Conservation and Energy Act of 2008 (2008 Farm Bill) amended the Farm Security and Rural Investment Act of 2002 (2002 Farm Bill) which had reauthorized the Farmland Protection Program (FPP). The Federal Agriculture Improvement and Reform Act of 1996 established FPP as a new farmland protection program. Under the FPP, the Secretary of Agriculture, acting through the NRCS, was authorized, on behalf of the Commodity Credit Corporation (CCC), to purchase conservation easements for the purpose of protecting topsoil by limiting nonagricultural uses of the land. The 2008 Farm Bill changed the purpose of the program to providing funding for the purchase of conservation easements to protect agricultural productivity and related conservation values of land. The FPP enabled the Federal government to establish partnerships with State or local governments to share in the costs of acquiring conservation easements. The program name Farm and Ranch Lands Protection Program (FRPP) was established in the 2003 Final Rule and more accurately reflects the types of land the program protects. The 2002 Farm Bill added Tribal governments and non-government organizations as eligible cooperating entities with which NRCS could share the costs of acquiring easements. FRPP supports the NRCS Strategic Plan Mission Goal of Working Farms and Ranch Lands. Through FRPP NRCS: - - • Establishes partnerships with State, Tribal, or local governments or non-governmental organizations to leverage their purchase of development rights by providing matching funds not to exceed 50 percent of the appraised fair market value; • Acquires perpetual conservation easements on a voluntary basis on farm and ranch lands that contain prime, unique, or other productive soil or historical and archaeological resources; and • Protects agricultural use and related conservation values by limiting conversion to nonagricultural uses of the land. Program Operation - - - Cooperating Entity Eligibility. FRPP is carried out through existing farmland protection programs of State, Tribal, local governments or non-governmental organizations. These cooperating entities include local or State agencies, counties, municipalities, towns or townships, soil and water conservation districts, American Indian Tribes or Tribal organizations, and eligible non-governmental organizations. They may apply for FRPP funds if they have a farmland protection program that purchases conservation easements for the purpose of protecting agricultural productivity and related conservation uses of land by limiting conversion to nonagricultural uses, and if they have pending offers with willing landowners. Potential participating cooperating entities must provide written evidence of: - - • Cooperating entities’ commitment to long-term conservation of agricultural lands through the use of legal instruments (i.e., right-to-farm laws, agricultural districts, zoning, or land use plans); • The use of voluntary approaches to protect farmland from conversion to nonagricultural uses; • The capability to acquire, manage, and enforce easement rights or other interests in land; and, • The availability of cash funds to provide a minimum 25 percent, in cash, of the purchase price (appraised fair market value minus the landowner donation) of the conservation easement. Landowner Eligibility. Individual landowners must apply to and be accepted by the eligible State, Tribe, or local governments or non-governmental programs to participate in FRPP. They must meet Farm Bill requirements for adjusted gross income, wetland conservation and highly erodible land conservation. Land Eligibility. Land must meet one of three criteria to qualify for consideration in FRPP: • Land that has 50 percent prime, unique, and important farmland soil; • Land that has historic or archeological resources; or • Land that supports the policies of a State or local farm and ranch protection program. Application and Selection Process. NRCS uses a continuous signup for cooperating entities to submit parcels proposed for funding. Upon receipt of the applications for parcels from an eligible cooperating entity, each NRCS State office evaluates the entities, land, and landowners for eligibility, and gives each parcel a score based on established ranking criteria. On an announced date, the parcels are ranked and prioritized. NRCS awards funds to the eligible cooperating entities that submitted the highest ranked 279 25g-60 parcels for which the State NRCS office has FRPP funding. Cooperative agreements are signed between the cooperating entities and NRCS to obligate FRPP funds. Cooperating entities process the easement acquisition, and also hold, manage, and enforce the acquired easements. The Federal share for any easement acquisition cannot exceed 50 percent of the appraised fair market value of the conservation easement. Each conservation easement deed must include a Right of Enforcement to protect the Federal investment. To ensure responsible land stewardship, the landowner must implement a conservation plan protecting highly erodible land on each parcel acquired in part with Federal funds. After the cooperating entities complete the easement acquisition, they submit the appropriate documentation to the NRCS State office and request reimbursement equal to the Federal share of the easement purchase price. NRCS may issue payment at closing or on a reimbursable basis. FRPP funds are made available from the Commodity Credit Corporation (CCC). A failure by the cooperating entity to abide by the terms of the cooperative agreement or the recorded easement deed may result in the easement rights being vested solely in the United States, the United States receiving reimbursement in full for the Federal share of the easement purchase price, or the United States pursuing action in Federal court to have the terms of the deed enforced. - NRCS Technical Assistance. NRCS provides technical assistance to landowners who develop conservation plans for those acres that have been accepted in FRPP. These activities include conservation planning, verification of the eligibility of the entity, landowner, and land; assessment of the risk of hazardous materials; evaluating and ranking applications; developing cooperative agreements; reviewing deeds, title, and appraisals; and processing payments. NRCS monitors the easements and enforces violations of the conservation easement deeds. . Cumulative Summary 1996-2009. From 1996-2009, a total of $741.8 million was appropriated to FRPP. During that time, 49 States have received over $715.5 million in financial assistance from FRPP funds. Easements on 2,380 farms and ranches have been purchased using FRPP funds. It is estimated that 456,624 acres of prime, unique, and important farmland have been or will be permanently protected from conversion to nonagricultural uses with these easements. Approximately 655,270 acres on 3,142 farms, with an estimated cumulative easement value of nearly $1.9 billion, have or will have easement contracts in the near future. Acquisition of 434 parcels covering 67,634 acres has been cancelled because the cooperating entity had not demonstrated progress on the acquisition when the cooperative agreement expired or the landowner decided not to sell an easement. NRCS and the cooperating entities acquire all easements for perpetuity. The demand for the program has exceeded available funds by approximately 200 percent. For every Federal dollar invested through FRPP, an additional two dollars has been contributed by the participating State, Tribal and local governmental entities, non-governmental organizations, and landowners. In FY 2009, Congress appropriated $120 million for FRPP. Selected Examples of Recent Progress Colorado - Quarter Circle U Ranch. The Colorado Cattlemen’s Agricultural Land Trust (CCALT), NRCS FRPP, the National Fish and Wildlife Foundation and the San Luis Valley Habitat Partnership Program all contributed to the protection of the 1,575-acre Quarter Circle U Ranch in the Saguache Creek Corridor. Over the past decade, these partnerships have resulted in 15 ranchland conservation easements that have protected more than 11,000 acres along Saguache Creek and its tributaries. Great Outdoors Colorado’s six million dollars lottery-funded Legacy Grant helped protect 6,446 of the 11,000 acres. The Quarter Circle U Ranch, named for the landowners’ cattle brand, contains over 4% miles of Saguache Creek and nearly 1,000 acres of irrigated hay meadows. In addition, the ranch has extensive native grass and shrubland pastures and is adjacent to tens of thousands of acres of Bureau of Land Management land to the east and west. The cottonwood-lined creek and lush meadows are visible to travelers along scenic Highway 114 between Saguache and Gunnison, which is the longest undeveloped pass in Colorado. The ranch supports a wide array of wildlife including wintering bald eagles, and provides critical winter range for the area’s elk herds and deer. 280 25g-61 Georgia – Wiley Farm. The Georgia Land Conservation Program and the FRPP contributed to the protection of 50 acres of the 175-acre Wiley Farm. The Wiley Farm is located in Covington, Walton County, Georgia; and has been farmed continuously since 1821 when Jesse Gilbert drew it in a lottery. Marvin Lester Wiley and Margret Wiley, the grandparents of the current owner, purchased this farm in 1919. They farmed cotton on this farm and put it in the "soil-bank" in 1948. The current owner, Herman Dale Wiley, has been farming this land since about 1968 when he was 13 years old. The property is primarily a cattle and hay production farm. The farmhouse was built in 1910 and the farm has a small cemetery with 23-30 plots of dating from the Revolutionary War. The farm provides watershed protection for the Cornish Creek Watershed. The small pond on the property flows into the adjacent Varner Watershed Lake which is the primary drinking water source for Walton and Newton counties. There are 35-foot riparian buffers along the stream channel and a 100-foot buffer around the farm pond. The buffers provide habitat for many birds including migratory songbirds, blue herons, egrets, warblers, pileated woodpecker and wild turkey, hawks, and owls. The farm offers a considerable scenic benefit as it provides the ridgeline for Lake Varner, a public fishing and recreation lake. The farm is clearly visible from Lake Varner, and provides aesthetic benefit to this resource. The scenic beauty of the lake will be preserved by eliminating the possibility of development, thus enabling generations of fisherman to enjoy the lake as it is today. Vermont - Blue Spruce Farm. The Audet family, owners of Blue Spruce Farm, has farmed in Bridport since the 1950s. This past December, the Audets conserved 441 acres of land that they purchased from Stephen and Margaret Cooke in 2007. Three Audet brothers Eugene, Earle and Ernie and over 20 family members and employees manage the modern dairy operation that includes a methane digester, which turns manure into electricity. The family milks over 1,000 cows. Selling the easement was a business decision for the family. The easement payment helps their bottom line. They are in the dairy business for the long haul and they need this land for growing hay and corn. In addition to 415 acres of cropland and pasture, the property has 11 acres of rare clayplain forest. Wisconsin–Strack Farm. A 200 cow dairy farm owned by Ken and Margie Strack from Adell, Wisconsin enrolled in the FRPP. The farm is in the North Branch Milwaukee River Wildlife and Farming Heritage Area, one of the largest blocks of open space remaining in southeastern Wisconsin. The Stracks farm with their sons who live on the 118 acre farm in Sheboygan County, Wisconsin. The easement contains 81 acres of cropland, 9.5 acres of lowland forest, and 13.4 acres of wetland. A portion of the property will be open for public hunting. This farm will be preserved for generations to come. CONSERVATION SECURITY PROGRAM Current Activities - Background. The Conservation Security Program (CSP) is authorized by the Farm Security and Rural Investment Act of 2002. The CSP is a voluntary program administered by the NRCS, The program provides financial and technical assistance to producers who advance the conservation and improvement of soil, water, air, energy, plant and animal life, and other conservation purposes on Tribal and private working lands. Such lands include cropland, grassland, prairie land, improved pasture, and rangeland, as well as forested land and other non-cropped areas that are an incidental part of an agricultural operation. The CSP regulation implements provisions set out in Title XII, Chapter 2, Subchapter A, of the Food Security Act of 1985, 16 U.S.C. 3801 et seq., The Food Conservation and energy Act of 2008, Public Law 110–246, authorizes NRCS to use such sums as are necessary to administer contracts entered into before September 30, 2008, and is intended to assist agricultural producers in taking actions that will provide long- term beneficial effects. Agricultural producers are longtime stewards of America’s working lands and the CSP supports this ongoing stewardship by providing financial and technical assistance for producers to maintain and enhance resources. The purpose of CSP is to: 281 25g-62 • Identify and reward those farmers and ranchers meeting the very highest standards of conservation and environmental management on their operations, - - • Create powerful incentives for other producers to meet those same standards of conservation performance on their operations, and - • Provide public benefits for generations to come. CSP rewards those farmers and ranchers who reach the pinnacle of good land stewardship and encourages others to enhance the ongoing production of clean water and clean air on their farms and ranches. The program is available to all eligible producers on privately owned or Tribal lands in all 50 States, the District of Columbia, the Commonwealth of Puerto Rico, Guam, the Virgin Islands of the United States, American Samoa, and the Commonwealth of the Northern Marianna Islands. Land and Participant Eligibility Requirements. The following are CSP land and participant eligibility requirements: - • The land must be privately owned or Tribal working land and the majority of the land must be located within one of the selected watersheds (forest land is not eligible). - • The applicant must be in compliance with highly erodible and wetland provisions of the Food Security Act of 1985, have an active interest in the agricultural operation, and have control of the land for the life of the contract. • The applicant must share in the risk of producing any crop or livestock and be entitled to a share in the crop or livestock marketed from the operation. - • The applicant’s average adjusted gross income for the preceding three years must be less than $2.5 million unless 75 percent of that income is from farming, ranching, or forestry interest. Natural Resource Emphasis and Three Tier Approach. The CSP emphasizes water quality and soil quality as nationally significant resource concerns because of the potential for significant environmental benefits from conservation treatment that improves their condition. The CSP rewards three levels of conservation treatment. Tier I contract participants must have addressed water quality and soil quality resource concerns to the sustainable level of treatment on part of the participant’s agricultural operation prior to application. Tier II contract participants must have addressed water quality and soil quality resource to the sustainable level of treatment on the entire agricultural operation prior to application. Tier II contract participants must also treat an additional significant resource concern by the end of the contract period. For Tier III, the contract participants must have addressed all existing resource concerns to the sustainable level on their entire agricultural operation before application. Participant’s payments are determined by the tier of participation, conservation treatments completed and the acres enrolled: • For Tier I (part of their agricultural operation), contracts are for five years; maximum payment is $20,000 annually; - - • For Tier II (all of their agricultural operation), contracts are for five to ten years; maximum payment is $35,000 annually; • For Tier III (all of their agricultural operation), contracts are for five to ten years; maximum payment is $45,000 annually. Priority Watershed Delivery. NRCS uses a watershed approach to deliver CSP to the farmers and ranchers of America’s working agricultural lands. NRCS prioritizes watersheds based upon a nationally consistent process that uses existing natural resource, environmental quality, and agricultural activity data along with other information necessary to efficiently operate the program. Sign-ups for CSP participation are rotated between watersheds on an annual basis. This priority watershed delivery approach reduces the administrative burden on applicants and minimizes the cost of processing a large number of applications that could not be funded. It also allows NRCS the flexibility to expand CSP as more program funds become available. - 282 25g-63 Technical and Financial Assistance to Participants. Technical assistance is available to CSP participants through the NRCS or an approved TSP. This technical assistance includes help to finalize the CSP application after producers have determined they meet CSP minimum requirements, to document a conservation stewardship plan, and to apply conservation treatment on their land. There are four components to CSP financial assistance payments: • An annual stewardship component for the base level of conservation treatment, • An annual existing practice component for the maintenance of existing conservation practices, • An enhancement component for exceptional conservation effort and additional activities that provide increased resource benefits beyond the prescribed level, and • A one-time new practice component for additional needed practices, Since 2003, over $1.4 billion of financial and technical assistance has been invested in 21,359 CSP contracts to enhance environmental benefits on over 17.7 million acres. With that investment, CSP has continued to pioneer the conservation efforts of producers and NRCS. Since its inception, CSP has been a significant contributor within the emerging areas of carbon and energy management. NRCS is providing payments for enhancement activities under the CSP to promote carbon sequestration, energy conservation, and the production and use of renewable fuels and electricity. These exceptional conservation efforts include activities such as: • Sequestration of greenhouse gases as measured by improvements to the soil conditioning index, which reflects soil organic matter levels; - Generation of renewable energy; Use of renewable energy fuels like biodiesel and ethanol, Recycling of on-farm lubricants; and Reductions in soil tillage intensity ratings. Since 2004, over 25.4 million collective acres of soil management activities have been applied to improve soil carbon levels, resulting in an increase of nearly 14 million tons of carbon sequestered. CSP activities resulted in significant reductions in on-farm energy use due to the implementation of 19.2 million collective acres of enhanced energy management activities. - CONSERVATION STEWARDSHIP PROGRAM Current Activities Background. The Conservation Stewardship Program (CSP) is authorized by the Food, Conservation, and Energy Act of 2008 (2008 Act) and replaces the Conservation Security Program. The CSP is a voluntary program administered by the NRCS. The purpose of CSP is to encourage producers to address resource concerns in a comprehensive manner by: - • Undertaking additional conservation activities; and • Improving, maintaining, and managing existing conservation activities. CSP encourages agricultural and forestry producers to maintain existing conservation activities and to adopt additional ones on their operations. CSP provides opportunities to both recognize excellent stewards and deliver valuable new conservation. CSP is available on Tribal and private agricultural lands, as well as nonindustrial private forest lands in all 50 States, the District of Columbia, the Commonwealth of Puerto Rico, Guam, the Virgin Islands of the United States, American Samoa, and the Commonwealth of the Northern Marianna Islands. The program provides equitable access to all producers, regardless of operation size, crops produced, or geographic location. The program is available on a continuous sign-up basis. 283 25g-64 Eligibility. Producers must meet applicant eligibility requirements that include: Being the operator of record in the USDA farm records management system for the eligible land being offered for enrollment; Having documented control of the land for the term of the proposed contract; and Being in compliance with the highly erodible land and wetland conservation provisions of 7 CFR Part 12, and adjusted gross income provisions. The following are CSP land eligibility requirements: * The 2008 Act limits eligibility to private agricultural land and agricultural Indian lands. Those lands include cropland, pastureland, and rangeland. Non-industrial private forestland is eligible by special provision, but it can make up no more than 10 percent of the acres enrolled nationally in any fiscal year. The entire operation must be enrolled and must include all eligible land that will be under the applicant's control for the term of the proposed contract that is operated substantially separate from other operations. Land enrolled in the Conservation Reserve Program, Wetlands Reserve Program, Grasslands Reserve Program, and Conservation Security Program are ineligible for CSP. Additionally, a participant may not receive payment for land used for crop production after June 18, 2008, that had not been planted, considered to be planted, or devoted to crop production for at least four of the six years preceding that date, unless the land was: - ... " previously enrolled in the Conservation Reserve Program; maintained using long-term rotations, such as hayland in rotation; or incidental to the operation but needed for the efficient management of the operation. How CSP Works. NRCS at the State level, in consultation with the State Technical Committee and local working groups, will focus CSP on natural resources that are of specific concern for a State or the specific geographic areas within a State. Applicants will be ranked relative to other applicants who face similar resource challenges in these ranking pools using conservation performance ranking scores. Agricultural land and nonindustrial private forest land will be ranked separately. Producers interested in CSP are encouraged to begin the application process by completing a producer self- screening checklist. The self-screening checklist helps potential applicants decide for themselves whether CSP is the right program for them. Once applicant and land eligibility are determined, the NRCS field office will assist the producer with completing the Conservation Measurement Tool (CMT). The CMT will estimate the level of environmental benefit to be achieved by the applicant. The CMT conservation performance scoring will enable NRCS to determine if the stewardship threshold requirement is met, rank applications, and establish payments. - For a pre-approved applicant, NRCS will request the applicant’s conservation activity records and conduct on-site field verification to ensure that information provided by the applicant was accurate prior to contract approval. Once information is verified, NRCS and the applicant proceed to develop the contract. Upon approval, the contract will obligate the participant to achieve a higher level of conservation performance by installing additional activities scheduled in their conservation stewardship plan and to maintain the level of existing conservation performance identified at the time of application. - Benefits to Participants. CSP provides participants with two possible types of payments. An annual payment is available for installing new conservation activities and maintaining existing activities. A supplemental payment may be earned by participants receiving an annual payment who also adopt a resource-conserving crop rotation. Through five year contracts, payments will be made as soon as practical after October of each year for contract activities installed and maintained in the previous year. For all contracts, CSP payments to a person or legal entity may not exceed $40,000 in any year and $200,000 during any five year period. Each CSP contract will be limited to $200,000 over the term of the initial contract period. Continuous Sign-Up Begins. Congress authorized the enrollment of 12,769,000 acres for each Fiscal Year (FY) for the period beginning October 1, 2008, and ending on September 30, 2017. Continuous sign-up for 284 25g-65 CSP started on August 10, 2009. The ranking period cut-off for FY 2009 acres ended September 30, 2009. During the ranking period, over 21,200 applications were received covering an estimated 33,000,000 acres. NRCS will rank the applications through the CMT and those applications that rank the highest will be approved for contracts. Those applications not selected for funding may be deferred into the next sign up. GRASSLAND RESERVE PROGRAM Current Activities Background. The Grassland Reserve Program (GRP) was authorized by Sections 1238 N through Q of the Food Security Act of 1985 (P.L. 99-198) as amended by The Food Conservation and Energy Act of 2008 (2008 Farm Bill). A voluntary program, GRP helps landowners and operators restore and protect rangeland, pastureland, and other grassland while maintaining the land’s suitability for grazing. As required by statute, GRP’s emphasis is on supporting grazing operations, plant and animal biodiversity, and grassland and land containing shrubs or forbs under the greatest threat of conversion. Land is eligible if it is privately owned or Tribal land, and it is 1) grassland that contains forbs or shrubs (including rangeland and pastureland) for which grazing is the predominant use or 2) located in an area that has been historically dominated by grassland, forbs, or shrubs. The land must also have potential to provide habitat for animal or plant populations of significant ecological value if the land is retained in the current use or restored to a natural condition. Incidental lands may be included to allow for the efficient administration of an agreement or easement. GRP contributes to two NRCS strategic Mission Goals: Healthy Plant and Animal Communities, and Working Farm and Ranch Lands. GRP participants are required to follow a grazing management or conservation plan including grazing practices. The program is jointly administered by the NRCS and the Farm Service Agency (FSA). NRCS has lead responsibility on technical issues and easement . administration. FSA has lead responsibility for rental contract administration. Although each agency has a specific focus related to program administration, FSA and NRCS work collaboratively on all program matters. The program operates under a continuous signup process. NRCS and FSA in consultation with the State Technical Committees use State developed ranking criteria to ensure GRP funds are focused on projects that address program priorities and objectives. Applications, ranking criteria and program forms are publicly available through agency websites. Program Enrollment Options. Participants have the opportunity to enroll acreage in rental contracts, permanent conservation easements. Participating land will be managed to maintain the viability of the plant community as described in a participant’s grazing management plan developed with the NRCS. With USDA approval, participants may include a restoration agreement with either enrollment option. A $50,000 payment limitation applies to restoration agreements and rental contracts. All enrollment options permit grazing on the land in a manner that is consistent with maintaining the viability of the natural grasses, shrubs, and forbs. Haying, mowing, or harvesting seed is permitted except during the nesting seasons for area bird species that are in significant decline. USDA gives a higher priority to applications with high quality grassland needing protection rather than restoring poorer quality grassland. Features of the various enrollment options are: • Ten-year, 15-year, or 20-year rental contracts. Rental payment amounts will not exceed 75 percent of the grazing value for the length of the contract and are paid annually after the anniversary date of the contract. County-based grazing values (determined on soil productivity) are posted in USDA field offices. Payment rates are evaluated to assure that the rates reflect local prevailing rental rates. • Permanent easements. Easement duration is in perpetuity, or the maximum extent allowed by State law. Participants are provided an easement payment after the easement is filed. Easement payment 285 25g-66 amounts will not exceed the current market value of the land less the grazing value of the land encumbered by the easement. Easement compensation is determined as the lower of 1) an appraisal or market-wide survey, 2) a geographic cap, or 3) a landowner offer. For easements held by the United States, the Commodity Credit Corporation pays costs associated with recording the easement in the local land records office (recording fees, charges for abstracts, surveys, appraisal fees, title insurance, etc.). These costs are authorized for payment under Section 303 of the Uniform Relocation Assistance and Land Acquisition Policies Act of 1970. If NRCS and the landowner determine that restoration is necessary to return the vegetation to a desired condition, cost-share assistance is available. Participants may receive up to 50 percent of the restoration cost up to $50,000 per year. Cooperative Agreements. Cooperative agreements were authorized for use in GRP allowing an eligible entity to write, own and enforce GRP easements. An eligible entity is a unit of State or local government, Indian Tribe or land trust that demonstrates it has the relevant experience and resources to administer a GRP easement. Its charter or mission describes its long-term commitment to conserving ranchland, agricultural land, or grassland for grazing and conservation purposes. Before entering into a cooperative agreement, NRCS evaluates an entity’s capacity to acquire, manage and enforce easements; its staffing; and the ability of an entity to provide matching funds. The entity assumes all administrative and restoration costs. The United States maintains a contingent right of enforcement. Technical Assistance. The participant develops a grazing management plan or conservation plan including grazing practices with NRCS for the acres determined eligible for GRP. NRCS provides technical assistance to the participant after the land is enrolled. The plan specifies the manner in which the grasslands should be managed to maintain their viability. Participants have the opportunity to use common management practices to maintain the viability of the grazing uses and related conservation values. NRCS technical assistance includes reviews of restoration measures, guidance on management activities, and basic biological advice to achieve optimum results considering all grassland resources. New Acreage Cap. The Food, Conservation, and Energy Act of 2008 authorized the enrollment of 1,220,000 acres of eligible land in the program during the fiscal years 2009 through 2012. Selected Example of Recent Progress Washington State protecting historic grazing lands. The Colvin family ranched on their 530 acres family homestead along Scatter Creek in Washington State since Ignatius Colvin arrived over the Oregon Trail in the 1850's. GRP easements allow the current generation of the Colvin family to keep the land as a working ranch in perpetuity. Urban development pressures in western Washington make maintaining large tracts of grazing lands very difficult. By granting GRP easements, the entire 530 acres grazing area soon will be protected. The contiguous easements were funded through fiscal year 2004, 2005 and 2009 allocations. The Colvin family's grazing management plan, developed with NRCS, maintains and enhances native prairie habitat. - 286 25g-67 FY 2009 Summary. States obligated and committed $40.5 million, with 60 percent of the funds enrolling GRP easements and 40 percent of the funds enrolling rental contracts. GRP Accomplishments FY 2003 FY 2004 FY 2005 FY 2006 FY 2007 | FY 2008 |ry º - Cumulative Totals Number of participants enrolled 794 1,055 2,211 2,803 2,805 2,812 3,201 Acres enrolled 240,965 524,303 625,759 719,246 | 724,772 725,352. 871,621 GRP conservation easements 27 27 11,344 45,850 111,615 117,200 117,200 Permanent protection of native grassland, rangeland, and shrubland through GRP - - - conservation easements 60,341 78,218 97,742 105,682 106,660 107,249 163,937 AGRICULTURAL MANAGEMENT ASSISTANCE PROGRAM Current Activities - Background. Section 524(b), Agricultural Management Assistance (AMA), authorized the Secretary of Agriculture to use $10 million of Commodity Credit Corporation (CCC) funds for cost-share assistance in ten to 15 States where participation in the Federal Crop Insurance Program is historically low. Section 524(b) of the Federal Crop Insurance Act, 7 U.S.C. 1524(b), was added by Title I, Section 133, of the Agricultural Risk Protection Act of 2000 (PL 106-224, June 22, 2000), Section 133 (Public Law 106-224. Section 524(b), was further amended by the Food, Conservation and Energy Act of 2008 (P.L. 110–246). Section 524(b)(2)(A), (B), and (C) provides for financial assistance to producers to construct or improve water management structures or irrigation structures; plant trees for windbreaks or improve water quality; and mitigate risks through production diversification or resource conservation practices, including soil erosion control, integrated pest management, or transition to organic farming. Section 524(b)(2)(D) and (E) provides for cost-share assistance to producers to enter into futures, hedging, or options contracts in a manner designed to help reduce production, price, or revenue risk. The Secretary has designated 16 States to participate in AMA: Connecticut, Delaware, Hawaii, Maine, Maryland, Massachusetts, Nevada, New Hampshire, New Jersey, New York, Pennsylvania, Rhode Island, Utah, Vermont, West Virginia, and Wyoming. NRCS, the Risk Management Agency, and the Agricultural Marketing Service administer the AMA funds in amounts determined by the Secretary. Program Design. NRCS developed the conservation provisions so the implementation would be flexible and allow States the opportunity to use the program to meet their resource needs. States individually determined the resource concerns to be addressed, eligible practices, and applicant ranking criteria, the ranking process, and cutoff dates for ranking applications. States are responsible for fund allocations within the State, payment methods, and public outreach and information activities. The program does not have any buy-down provisions and payments can be made the first year of the contract. Participants may use AMA in conjunction with other USDA conservation programs. Program Implementation. Participation in AMA is voluntary. Applicants are required to own or control the land, agree to implement specific eligible conservation practices, and to meet the Food Security Act ‘person' definition. AMA implementation is based on a conservation plan that is the basis for developing the AMA contract. Participants enter into contracts that may be a minimum length of one year to a maximum often years to install the planned and needed conservation practices, Participants must agree to maintain cost-shared practices for the life of the practice. Participants are allowed to contribute to the cost 287 25g-68 if a practice through in-kind contributions. Eligible in-kind contributions include personal labor, use of jersonal equipment, donated labor or materials, and on-hand or approved used materials. n FY 2009, NRCS allocated $7.5 million of CCC funds to the AMA States for financial and technical issistance for approval of new AMA contracts. In FY 2009, $6.2 million was obligated into 214 contracts overing 13,875 acres. Currently, there are 723 contracts in implementation. The continued backlog of pplications indicates support among producers for AMA. The total application backlog is 266 pplications covering 23,471 acres for about $10.3 million. CHESAPEAKE BAY WATERSHED PROGRAM ackground. Section 2605 of the Food, Conservation, and Energy Act of 2008 (2008 Act) (P.L. 110-246, une 18, 2008) added the Chesapeake Bay Watershed Program to the Food Security Act of 1985 (1985 Act). The 2008 Act amended Chapter 5 of subtitle D of Title XII of the 1985 Act by inserting after section 240P (16 U.S.C. 3839bb–3) the following new section: SECTION 12400 — Chesapeake Bay Watershed. *rogram Operation. The Chesapeake Bay Watershed Program (CBWP) is carried out through the various latural resources conservation programs authorized under subtitle D, Title XII of the 1985 Act (16 U.S.C. 830–3839bb–5). The CBWP assistance in FY 2009 used the Environmental Quality Incentives Program EQIP) and followed EQIP requirements and policies. NRCS administers the CBWP and carries out rogram implementation using funds, facilities, or authorities of the Commodity Credit Corporation (CCC). 'rogram Objectives. The CBWP helps agricultural producers improve water quality and quantity, and estore, enhance, and preserve soil, air, and related resources in the Chesapeake Bay Watershed through the lementation of conservation practices. These conservation practices reduce soil erosion and nutrient vels in ground and surface water, improve, restore, and enhance wildlife habitat, and help address air uality and related natural resource concerns. and and Participant Eligibility Requirements. Only agricultural producers owning or operating within he Chesapeake Bay Watershed are eligible to participate in the CBWP. The Chesapeake Bay Watershed is efined as all tributaries, backwaters, and side channels, including their watersheds, draining into the hesapeake Bay. The Chesapeake Bay Watershed area includes portions of the States of Delaware, Maryland, New York, Pennsylvania, Virginia, and West Virginia. ſational Priorities. Section 2605 of the 2008 Act gives special, but not exclusive, consideration to roducers’ applications in the following river basins: Susquehanna River, Shenandoah River, Potomac liver (including North and South Potomac), and the Patuxent River. inancial Assistance. Under CBWP, the Secretary of Agriculture uses the funds to enter into agreements nd cover the costs of applicable conservation programs used to apply conservation treatment by eligible roducers in the Chesapeake Bay Watershed. The CBWP will use the same eligibility requirements stablished for the various natural resources conservation programs authorized under subtitle D, Title XII f the 1985 Act (16 U.S.C. 3830–3839bb–5). onservation Plan. With NRCS or approved Technical Service Providers (TSPs) assistance, a participant evelops a conservation plan for the offered acres initially determined eligible. The plan specifies the lethod in which the planned conservation treatment practices and systems on the enrolled acres will be mplemented, operated, and maintained. The conservation plan is the basis for the applicable conservation rogram contract. ontract and Contract Modifications. The CCC provides funding for financial assistance payments to bply needed and approved conservation practices and systems and land use adjustments within a time 288 25g-69 schedule specified by the conservation plan. The CBWP contracts may be modified to increase funds provided the increased cost is the result of a valid contract modification within the original contract scope and intent. The modification will follow the rules of the conservation program used to apply the conservation treatment, - An example of an appropriate modification would be the adoption of a local government rule that requires more environmental protection for an agrichemical handling facility. The new rule became effective after the conservation program contract and cost estimate was prepared. The original intent of the conservation treatment was to install an agrichemical handling facility that meets all Federal, State, and local rules in order for NRCS to approve its construction. The contract needs to be modified to meet the new local rule in order to install the originally contracted agrichemical handling facility. All modifications are reviewed and approved according to authorities delegated to the State Conservationist. Technical Assistance and Partnerships. Under the CBWP, the Secretary of Agriculture will consult wit appropriate Federal and State agencies to ensure conservation activities carried out under the CBWP complement Federal and State programs in the Chesapeake Bay Watershed. Selected Examples of Recent Progress. In FY 2009, more than $18.5 million of financial assistance was used to treat an estimated 110,300 acres. Examples of conservation treatment practices include conservation crop rotation, conservation tillage, cover crop, fence, waste storage facility, riparian buffers, heavy use area protection, nutrient management, and streambank and shoreline Protection, Significant Accomplishments. By working with State Technical Committees and partners during FY 2009, each Chesapeake Bay Watershed State identified high priority sub-watersheds (12 digit Hydrologic Unit Code level). Priority was based on nitrogen, phosphorous, and sediment loads delivered to the Bay, Stream Impairment status, partner resources, and ability to demonstrate results. Chesapeake Online Assessment Support Tools maps developed by United States Geological Survey and the Chesapeak Bay Program Office were heavily relied upon to identify areas of high nitrogen phosphorous and sediment agriculture contributions. HEALTHY FORESTS RESERVE PROGRAM Background. Title V of the Healthy Forests Restoration Act of 2003 (Public Law 108-148) authorized establishment of the Healthy Forests Reserve Program (HFRP), and was amended by the Food, Conservation and Energy Act of 2008 (the 2008 Act), Public Law. 110-246. The purpose of this program is to assist landowners in restoring, enhancing and protecting forest ecosystems to 1) promote the recovery of threatened and endangered species, 2) improve biodiversity, and 3) enhance carbon sequestration. The HFRP supports the NRCS Mission Goal of Healthy Plant and Animal Communities. - Current Activities j Enrollment Options. There are four HFRP enrollment options: • 10-year cost share agreement for which the landowner may receive 50 percent of the cost of the approved conservation practices; • 30-year contract (the value of which shall be equivalent to the value of a 30-year easement) for which the landowner may receive 75 percent of the easement value of the enrolled land plus 75 percent of th cost of the approved conservation restoration practices. This option is available to Indian Tribes only • 30-year easement for which the landowner may receive 75 percent of the easement value of the enrolled land plus 75 percent of the cost of the approved conservation practices; or • Permanent easement for which landowners may receive 100 percent of the easement value of the enrolled land plus 100 percent of the average cost of the approved conservation practices. Eligibility and Restoration Plans. Only privately held land is eligible for enrollment into the HFRP. Additional eligibility requires the private land to restore, enhance, or measurably increase the likelihood c recovery of a threatened or endangered species or candidates for the Federal or State threatened or 289 25g-70 endangered species list. Technical assistance will be provided by NRCS to assist owners in complying with the terms of restoration plans under the HFRP. andowner protections similar to “Safe Harbor” will be made available to landowners enrolled in the RP who agree, for a specified period, to protect, restore, or enhance their land for threatened or ndangered species habitat. In exchange, they avoid future regulatory restrictions on the use of that land rotected under the Endangered Species Act. - - echnical Assistance. NRCS, in coordination with the U.S. Fish and Wildlife Service, develops a Healthy orests Conservation Plan with the landowner for the acres determined eligible for HFRP. The Healthy orests Conservation Plan integrates compatible silvicultural practices and habitat considerations to protect, estore and enhance forest ecosystems for the recovery of threatened and endangered species and candidate pecies. NRCS continues to provide assistance to the participant after the land is enrolled. This assistance y be in the form of guidance on practice implementation, review of restoration measures, guidance on nagement activities, and basic biological advice to achieve optimum results, considering all forestland n 2009, four states that were approved for funding include Oklahoma, Georgia, Oregon, and Indiana. These were in addition to the pilot states of Arkansas, Minnesota, Mississippi, and Maine. pplications were prioritized according to ranking criteria that promotes the recovery of habitats for the ed Cockaded Woodpecker, Gopher Tortoise, the Northern Spotted Owl, and the Copperbelly Watersnake. uring the 2009 signup, States accepted 122 applications covering 19,426 acres. Nine applications were nrolled into the easement program this year in Mississippi and Arkansas. Eight applications were enrolled to 30 year easements for 527 acres at an approximate value of $449,988. One application was enrolled to a permanent easement for 282 acres at an approximate value of $401,000. 2009, NRCS continued the implementation of the HFRP in the pilot States of Arkansas, Maine, innesota and Mississippi. In Mississippi, landowners are enrolling in the HFRP to promote the recovery f Federally listed threatened or endangered species targeted for habitat and population recovery activities. urrently Mississippi has 1,622 acres in conservation easements and an additional 1,467 acres under 10- ear restoration agreements to protect the gopher tortoise along with the gopher frog and the black pine nake, a candidate for listing. Summary Cumulative Total Applications Processed 292 Total Applications Approved 21 Total Acres Enrolled 692,872 Total Obligations $5,772,048 Restoration Activity Cumulative testoration Agreements Approved 6 testoration Agreement Acres 689,972 Notal Funds Obligated for Restoration Agreements $848,892 lasements Activity Cumulative asement Projects Enrolled 15 º Acres Enrolled 2,900 Total Funds Obligated for Easement Projects $4,923,156 290 25-57 NATURAL RESOURCES CONSERVATION SERVICE Summary of Budget and Performance Statement of Department Goals and Objectives The Natural Resources Conservation Service (NRCS) was established pursuant to Public Law 103-354, the Department of Agriculture Reorganization Act of 1994, (7 U.S.C. 6962). The mission of NRCS is “Helping People Help The Land.” The Agency accomplishes its mission by providing products and services that enable people to be good stewards of the Nation’s soil, water, and related natural resources on non-Federal lands. NRCS administers the following programs: • Conservation Operations (CO), which includes Conservation Technical Assistance (CTA), Soil Surveys, Snow Surveys and Water Supply Forecasts, and Plant Material Centers; • Watershed and Flood Prevention Operations (WFPO), which includes Watershed Operations authorized t P.L. 78-534 (PL-534), Small Watersheds authorized by P.L. 83-566 (PL-566), as amended, and Emergen Watershed Operations (EWP); Watershed Rehabilitation; Resource Conservation and Development (RC&D); Wetlands Reserve Program (WRP); Environmental Quality Incentives Program (EQIP); Farm and Ranch Lands Protection Program (FRPP); Wildlife Habitat Incentives Program (WHIP); Conservation Security Program (CSP); Conservation Stewardship Program (CStP); Agricultural Management Assistance (AMA); Grassland Reserve Program (GRP); Healthy Forest Reserve Program (HFRP); Agricultural Water Enhancement Program (AWEP); and Chesapeake Bay Watershed Program (CBWP). - The Agency also provides technical assistance to the Conservation Reserve Program (CRP) administered by Farm Services Agency. NRCS has four strategic goals: 1. High Quality, Productive Soils 2. Clean and Abundant Water 3. Clean Air 4. Healthy Plant and Animal Communities NRCS strategic goals focus on the natural resources that form the foundation for healthy lands and support USDA's Strategic Goals. The following table displays the links between NRCS’ strategic goals and objectiv and those of USDA. - 291 25-58 The NRCS has four strategic goals and ten strategic objectives. These strategic goals and objectives contribute to the Department's Strategic Goals. -> Programs sº Sº Agency Objectives that Key Outcome Contribute - USDA Strategic Agency Goal 2: Objective 2.1-2.3: P.L. 566*, Key Outcome 2 - Water Goal: Clean and By 2015, agricultural P.L. 534*, Quality: USDA will Abundant Water producers will reduce EWP*, The quality of surface assist rural potential delivery of CStP water and groundwater communities to sediment and nutrients from RC&D* is improved and create wealth so their operations. maintained to protect they are self- human health, support a Sustaining, healthy environment, repopulating and and enable productive thriving use of the land. economically. Objective 2.4: CO (Snow Key Outcome 3 - Water By 2015, farmers and Survey), antity: ranchers wiłł establish P.L. 566*, Water is conserved and conservation measures that | P.L. 534*, protected to ensure an conserve an additional 6.25 CStP abundant and reliable million acre-feet of water. supply for the Nation. USDA Strategic Agency Goal 1: Objective 1.1: CO (CTA, Soil | Key Outcome 1 - High- Goal: High-quality, By 2015, farmers will Survey), quality, Productive USDA wiłł Productive Soils manage 70 percent of EQIP, Soils: CD:Słłłę OUT cropland under systems that CSP, The quality of national forests maintain or improve soil CStP, intensively used soils is and private condition and increase soil FRPP maintained or enhanced working lands carbon. to enable sustained enhance our production of a safe, Water TeSOUrces healthy and abundant and are food and fiber supply, conserved, restored, and Agency Goal 2: Objective 2.1-2.3: AMA, CO Key Outcome 2 - Water made more Clean and By 2015, agricultural (CTA, Plant Quality: resilient to Abundant Water | producers will reduce Materials), The quality of surface climate change. potential delivery of P.L. 534*, water and groundwater sediment and nutrients from P.L. 566*, is improved and their operations. EWP*, maintained to protect WRP, human health, support a EQIP, healthy environment, AWEP, and enable productive CBWP, use of the land. CSP, CStP, 292 25–59. * - - Programs usºw, 'Str*:::.al Agency Objectives C that Key Outcome ontribute sº- USDA Strategic Agency Goal 2: Objective 2.4: AMA, CO Key Outcome 3 - Water Goal: Clean and By 2015, farmers and (CTA, Snow Quantity: USDA will Abundant Water ranchers will establish Survey), Water is conserved and £nsilſ& Otiſ conservation measures that EQIP, AWEP, protected to ensure an national forests conserve an additional 6.25 CSP, CStP, abundant and reliable and private million acre-feet of water. Watershed supply for the Nation. working lands - Rehabilitation enhance our - - Water resources Agency Goal 3: Objective 3.1: CO (CTA), Key Outcome 4 - Clean and are Clean Air By 2015, farmers and EQIP, Air: conserved, ranchers will apply CSP, Farmers and ranchers restored, and conservation measures to CStP, make a positive made more reduce annual soil losses CIG contribution to local air resilient to from wind erosion by 7 quality. climate change. percent. - Agency Goal 4: Objective 4.1: CO (CTA), Key Outcome 5- Healthy Plant By 2015, farmers, ranchers, EQIP, Grassland and and Animal and other landowners will CSP, Rangeland Ecosystems: Communities apply management that will CStP, Grassland and maintain or improve long- || GRP, rangeland ecosystems term vegetative condition FRPP are productive, diverse, on 150 million acres of and resilient and grazing land. provide a wide variety of environmental services. Objective 4.2: CO (CTA), Key Outcome 6 - Forest By 2015, non-industrial EQIP, Land Ecosystems: private forest landowners HFRP, Healthy forest lands will apply management that CStP, that are productive, will maintain or improve FRPP diverse, and resilient, vegetative condition and and provide a wide protect and enhance range of ecosystem ecosystem services on 9 Services. million acres of non- industrial private forest land that are considered to have minimal or degrading vegetative conditions. Objective 4.3: CO (CTA), Key Outcome 7 - Fish By 2015, farmers, ranchers, CSP, and Wildlife Habitat: and non-industrial private CStP, Working lands and forest landowners will WRP, waters provide habitat implement conservation HFRP, for diverse and healthy measures to improve an EQIP, wildlife, aquatic additional 8.5 million acres WHIP, species, and plant of essential habitat to CRP communities, benefit at-risk or declining species. 293 25-60 - Programs vsº Srººm Agency Objectives that Key Outcome Contribute USDA Strategic Agency Goal 4: Objective 4.4: CO (CTA), Key Outcome 8- Goal: Healthy Plant By 2015, farmers and WRP, Wetlands: USDA wiłł and Animal ranchers will create, restore, CRP, Wetlands provide high CHSüTC. Our Communities or enhance an additional EQIP quality habitat for national forests 1.25 million acres of migratory birds and and private wetlands on non-Federal other wildlife, protect working lands lands. water quality, and enhance our reduce flood damage, Water resources - and are conserved, restored, and made more resilient to climate change. USDA Strategic Agency Goal 2: Objective 2.1-2.3: CO (Plant Key Outcome 2 - Water Goal: Clean and By 2015, agricultural Materials) Quality: - USDA will help Abundant Water | producers will reduce The quality of surface America | potential delivery of water and groundwater promote sediment and nutrients from is improved and agricultural their operations. maintained to protect production and human health, support a biotechnology healthy environment, exports as and enable productive America works use of the land. to increase food security. *Not funded in the FY 2011 President’s Budget. Key Outcome 1 – High-quality, Productive Soils: The quality of intensively used soils is maintained or enhanced to enable sustained production of a safe, healthy and abundant food and fiber supply. Soil quality describes the capacity of a soil to sustain plant and animal productivity, maintain or enhance water and air quality, and support human health and habitation. High-quality soils are the foundation of productive roplands, forest lands, and grasslands and a vibrant and productive agriculture. NRCS provides landowners nd land users with assistance in adopting environmentally sound management practices. NRCS provides ormation on soil quality, plant materials, resource management and provides assistance in using the information to implement sustainable production techniques and new technologies. Land managers who receive CS technical assistance are more likely to plan, apply, and maintain conservation systems that support gricultural production and environmental quality as compatible goals. ong-term Performance Measures: arget: By 2015, farmers will manage 70 percent of cropland under systems that maintain or improve soil condition and increase soil carbon. - Baseline: In 2003, 60 percent of cropland was farmed under systems that maintained or improved soil condition and increased soil carbon. 294 25-61 Selected Past Accomplishments toward Achievement of the Key Outcome: - FY 2006 || FY 2007 || FY 2008 FY 2009 Program Performance Measure Actual Actual Actual Actual Cropland with conservation applied to CO-CTA improve soil quality, million acres 6.4 7.3 83 || 7.6 Cropland with conservation applied to - - EQIP improve soil quality, million acres 3.4 - 5.3 5.6 4.8 CStP Under development NA NA NA NA Selected Accomplishments Expected at the FY 2011 Proposed Resource Level: FY 2010 TFY 2011.T Program Performance Measure Target Target CO-CTA Cropland with COinServation applied to improve soil 7.5 7.7 quality, million acres s EQIP Cropland with conservation applied to improve soil 5.0 5.0 quality, million acres -- CStP Under development - TBD TBD Efficiency Measures: Program Efficiency Measure CO-CTA Acres of conservation applied per technical assistance staff year. EQIP Percent of conservation practices applied within the first three years of the contract. Number of active contracts approved per FTE. Key Outcome 2 — Water Quality: The quality of surface water and groundwater is improved and maintain to protect human health, support a healthy environment, and enable productive use of the land. Water running off or infiltrating the ground from agricultural operations can carry a number of potential pollutants into streams, lakes, groundwater, and estuaries. States and Tribes have identified sediment and nutrients as the greatest agricultural contaminants affecting surface water quality; nutrients and agrichemical are the major concerns for groundwater. NRCS sets long-term targets for reducing the potential of sediment and nutrients to move from agricultural operations. Long-term measures are supported by annual measures f application of conservation practices that reduce erosion and runoff and movement of nutrients. Long Term Performance Measures: Target. By 2015, potential sediment delivery from agricultural operations will be reduced by an additi 37.5 million tons (3.8% improvement over 2003 baseline). - Baseline: In FY 2003, potential sediment delivery from agricultural operations was 970 million tons. Reduce potential nitrogen delivery from agricultural operations. Target: By 2015, potential delivery of nitrogen from agricultural operations will be reduced by an additional 215,000 tons (3.6% improvement over 2003 baseline). Baseline: In FY 2003, potential annual nitrogen delivery from agricultural operations was an estimated million tons. - Reduce potential phosphorus delivery from agricultural operations. Target: By 2015, potential delivery of phosphorus from agricultural operations will be reduced by an additional 37,500 tons (10.4% improvement over 2003 baseline). Baseline: In FY 2003, potential annual phosphorus delivery from agricultural operations was an estimat 360,000 tons. Reduce potential sediment delivery from agricultural operations. | {} 295 25-62 High Performance Priority Goals: Accelerate the protection of clean, abundant water resources by implementing high impact targeted (HIT)" practices on 3 million acres of National Forest and private working lands in priority landscapes, which may include the upper Mississippi River basin and the California Bay Delta FY 2010 FY 2011 Program Performance Measure Target Target CO-CTA Priority landscapes with high impact targeted Conservation TBD” TBD” practices applied to improve water quality, acres EQIP Priority landscapes with high impact targeted COnServation TBD” TBD” practices applied to improve water quality, acres CStP Under development TBD” TBD” 'High Impact Targeted (HIT) Practices are defined as a suite of practices that when combined, offer the greatest opportunity to avoid, control and trap nutrients, sediments or air particulates or compounds from being generated or leaving an area under agricultural production. An example would be cover crops to avoid loss of nutrients to surface and ground water, combined with no-till cropping to control erosion and reduce sediment/nutrient runoff, and using a wetland to trap nutrients and sediment on an cropland operation to reduce the a edge of field /root zone loss of nitrogen, phosphorus, and sediment. *Targets for these measures will be established after the priority landscapes and HIT practices have been identified. - Selected Past Accomplishments toward Achievement of the Key Outcome: - FY 2006 FY 2007 FY 2008 || FY 2009 Program Performance Measure Actual Actual Actual Actual co-cra | Comprehensive nutrient management 2,269 1,911 1,745 1,485 plans applied, number • EQIP Comprehensive nutrient management 2,774 2,490 2,520 2,019 plans applied, number - CBWP Land with conservation applied to NA NA NA 4,572 improve water quality, acres Selected Accomplishments Expected at the FY 2011 Proposed Resource Level: FY 2010 FY 2011 Program Performance Measure - Target Target CO-CTA Comprehensive Nutrient Management Plans applied, number 1,300 1,300 EQIP Comprehensive Nutrient Management Plans applied, number 2,000 2,000 CBWP Land with conservation applied to improve water quality, acres 65,000 150,000 Efficiency Measures: Program Efficiency Measure CO-CTA Acres of conservation applied per technical assistance staff year. EQIP Percent of conservation practices applied within the first three years of the contract. Number of active contracts approved per FTE. 296 Key Outcome 3 — Water Quantity: Water is conserved and protected to ensure an abun 25-63 supply for the Nation. dant and reliable Agriculture is one of the largest users of the Nation’s surface water and groundwater, with irrigation being the greatest use. In arid and semi-arid areas, crop production depends almost entirely on irrigation. Competition for water in these areas is increasing as a result of increased human populations. In recent years, irrigation has been increasing in eastern States, resulting in increased competition among users. NRCS has set a long-term target for the conservation of water. The long-term measure is supported by an annual measure for the application of practices that improve the management of irrigation water. Long Term Performance Measures: Target: By 2015, farmers and ranchers will establish conservation measures that conserve an additional 6.25 million acre-feet of water (250% improvement over baseline). - Baseline: In 2005, an estimated 2.5 million acre-feet of water were conserved. High Performance Priority Goals: Accelerate the protection of clean, abundant water resources by implementing high impact targeted (HIT) practices on 3 million acres of National Forest and private working lands in priority landscapes. FY 2010 FY 2011 Program Performance Measure Target Target CO-CTA Priority landscapes with high impact targeted conservation TBD" TBD" practices applied to improve irrigation efficiency, acres EQIP Priority landscapes with high impact targeted conservation TBD" TBD" practices applied to improve irrigation efficiency, acres *Targets for these measures will be established after the priority landscapes and HIT practices have been identified. Selected Past Accomplishments toward Achievement of the Key Outcome: FY 2006 FY 2007 FY 2008 || FY 2009 Program Performance Measure Actual Actual Actual Actual co-CTA ||Land withºnservation applied to improve 678,149 || 828.246 | 844,818 753,214 irrigation efficiency, acres - EQIP and with ºnservation applied to improve | 738,923 || 333,033 | 1,048,319 | 1,131,159 irrigation efficiency, acres Selected Accomplishments Expected at the FY 2011 Proposed Resource Level: FY 2010 FY 2011 Program Performance Measure Target Target CO-CTA Land with conservation applied to improve irrigation 800,000 825,000 efficiency, acres EQIP Land with conservation applied to improve irrigation 1,100,000 1,000,000 efficiency, acres Efficiency Measures: Program Efficiency Measure CO-CTA Acres of conservation applied per technical assistance staff year. EQIP Percent of conservation practices applied within the first three years of the contract. Number of active contracts approved per FTE. 297 25-64 ey Outcome 4 — Clean Air: Farmers and ranchers make a positive contribution to local air quality. e quality of air affects every component of the natural system: soil, water, plants, animals, and people. As air uality and atmospheric change concerns increase, NRCS anticipates an expanded conservation focus on these sues. Many practices that protect soil and water also protect air quality. NRCS is revising and adapting onservation standards and specifications to better address air issues. NRCS will acquire and develop needed source data and technology and encourage accelerated adoption of practices to address air quality concerns. ong-Term Performance Measures: arget: By 2015, farmers and ranchers will apply conservation measures to reduce annual soil losses from wind rosion by 7 percent. aseline: In 2003, wind erosion accounted for more than 776 million tons of soil loss from cropland. elected Past Accomplishments toward Achievement of the Key Outcome: ſRCS is developing an annual performance measure to track the acreage on which conservation practices have een applied to reduce wind erosion. The Agency incorporates air quality considerations into conservation lanning with producers. NRCS has seven full-time staff members dedicated to air quality issues and evelopment of technological innovations. The NRCS Chief chairs a task force to address air quality issues. is task force includes USDA employees, industry representatives, and other experts in the fields of iculture and air quality and advises the Secretary in order to ensure that that Federal policy, in regard to air ollution, is based on sound scientific findings that are subject to adequate peer review and take into account rformance targets for FY2011 and future years will be established once the annual performance measure is lized, estimated to occur in FY 2010. NRCS will continue to provide assistance to producers to address six : quality and atmospheric change concerns: particulate matter (including coarse and fine particles, smoke, t, and off-site effects from wind erosion), ozone precursors, odor, chemical drift, ammonia, and greenhouse ases and carbon sequestration. Requests for assistance on these issues are expected to increase. Technology evelopment and transfer will continue to provide the field with the information and tools they need to provide igh quality service. - ſey Outcome 5 — Grassland and Rangeland Ecosystems: Grassland and rangeland ecosystems are roductive, diverse, and resilient and provide a wide variety of environmental services. ealthy, vigorous plant communities on rangeland and native or naturalized pasture lands protect soil quality, event soil erosion, provide sustainable forage and cover for livestock and wildlife, provide fiber, improve ater quality, provide diverse habitat for wildlife, and sequester carbon. Sustaining healthy grassland and ngeland ecosystems is achieved by focusing on interacting relationships between plant and animal species ithin a given ecosystem and their relationship to the physical features and processes of their environment. CS provides data and technical and financial assistance to people interested in creating, restoring, protecting d enhancing grassland and rangeland. ng Term Performance Measure: rget: By 2015, farmers, ranchers, and other landowners will apply management that will maintain or rove long-term vegetative condition on 150 million acres of grazing land (50% improvement over baseline). seline: In 1999, about 300 million acres of non-Federal grazing land were considered to be in minimal or :grading vegetative condition. 298 25-65 Selected Past Accomplishments toward Achievement of the Key Outcome; FY 2006 FY 2007 | FY 2008 || FY 2009 Program Performance Measure Actual Actual Actual Actual Grazing and forest land with conservation CO-CTA applied to protect and improve the resource # 1.8 14.2 16.0 #6.0 base, million acres -º- Grazing and forest land with conservation EQIP applied to protect and improve the resource 12.2 16.5 16.9 17.2 base, million acres Selected Accomplishments Expected at the FY 2011 Proposed Resource Level: - FY 2010 FY 2011 Program Performance Measure Target Target CO-CTA Grazing land with conservation applied to protect the 14 14 - resource base, million acres EQIP Grazing land with conservation applied to protect and 14.3 14.3 improve the resource base, million acres Note: Starting in FY2010, the former performance measure that covered grazing land and forest land has been split into two distinct measures, one for grazing land and one for forest land. Key Outcome 6 — Forest Land Ecosystems: Healthy forest lands that are productive, diverse, and resilient and provide a wide range of ecosystem services. Healthy, vigorous plant communities on forest lands protect soil quality, prevent soil erosion, provide fiber, improve water quality, provide diverse habitat for wildlife, and sequester carbon, Sustaining healthy forest ecosystems is achieved by focusing on interacting relationships between plant and animal species within a giv ecosystem and their relationship to the physical features and processes of their environment. NRCS provides data and technical and financial assistance to people interested in creating, restoring, protecting and enhancing forest lands. Long Term Performance Measure: Target: By 2015, non-industrial private forest landowners will apply management that will maintain or improve vegetative condition and protect and enhance ecosystem services on 9 million acres of non-industrial private forest land that are considered to have minimal or degrading vegetative conditions (an improvement of 4.5% over 2003 baseline). - - Baseline: In 2003, about 200 million acres of non-industrial private forest land were considered to be in minimal or degrading vegetative condition due to overstocking, invasive species, wildfire damage, insects, hurricane damage, or other factors. 299 25-66 Selected Past Accomplishments toward Achievement of the Key Outcome: FY 2006 FY 2007 || FY 2008 FY 2009 Program Performance Measure Actual Actual Actual Actual Grazing and forest land with conservation - CO-CTA applied to protect and improve the resource 11.8 14.2 16.0 16.0 base, million acres | Grazing and forest land with conservation EQIP applied to protect and improve the resource 12.2 16.5 16.9 17.2 base, million acres Selected Accomplishments Expected at the FY2011 Proposed Resource Level: * - - FY 2010 FY 2011 Program Performance Measure Target Target CO-CTA Forest land with conservation applied to protect and 600,000 600,000 improve vegetative condition, acres EQIP Forest land with conservation applied to protect and 700,000 700,000 improve vegetative condition, acres Note: Starting in FY2010, the former performance measure that covered grazing land and forest land has been split into two distinct measures, one for grazing land and one for forest land, Efficiency Measures: Program Efficiency Measure CO-CTA Acres of conservation applied per technical assistance staff year. EQIP Percent of conservation practices applied within the first three years of the contract. Number of active contracts approved per FTE. Key Outcome 7 — Fish and Wildlife Habitat: Working lands and waters provide habitat for diverse and healthy wildlife, aquatic species, and plant communities. Privately-owned and other non-Federal lands provide habitat for much of the Nation's wildlife. Protecting specific ecosystems and landscapes, including wetlands, grasslands, floodplains, and certain types of forests, can help support wildlife and aquatic species and provide benefits in the form of recreation, hunting, and other forms of agri-tourism. NRCS provides technical and financial assistance to maintain and enhance fish and wildlife habitat on non-Federal lands. Long-Term Performance Measures: Target: By 2015, farmers, ranchers, and non-industrial private forest landowners will implement conservation measures to improve an additional 8.5 million acres of essential habitat to benefit at-risk or declining species (a 425% increase over baseline). Baseline: In 2005, farmers, ranchers, and other landowners and managers improved habitat for declining and at- risk species on 2 million acres. 300 Selected Past Accomplishments toward Achievement of the Key Outcome: 25-67 FY2006 TFY2007 TTFY2005 TFY2009 Program Performance Measure Actual Actual Actual Actual Non-Federal land with conservation applied to - - WHIP improve fish and wildlife habitat quality, acres 175,543 388,769 316,896 333.02 Selected Accomplishments Expected at the FY 2011 Proposed Resource Level: - FY 2010 FY 2011 Program Performance Measure Target Target Non-Federal land with conservation applied to improve fish - WHIP and wildlife habitat quality, acres 350,000 | 400,000 Efficiency Measures: Program Efficiency Measure WHIP Acres of wildlife habitat improved per $1 million of financial assistance Key Outcome 8 — Wetlands: Wetlands provide high quality habitat for migratory birds and other wildlife, protect water quality, and reduce flood damage. Wetlands provide wildlife habitat, protect and improve water quality, lessen flooding impacts, and recharge ground water. NRCS uses voluntary incentive-based approaches to restore wetlands, make wetland determinations, and conduct wetland compliance reviews. Long-Term Performance Measures: Target: By 2015, farmers and ranchers will create, restore, or enhance an additional 1.25 million acres of wetlands on non-Federal lands (a 1.1% improvement over baseline). Baseline: In 2003, there were 111 million wetland acres on non-Federal lands in the contiguous United States. High Performance Priority Goals: Accelerate the protection of clean, abundant water resources by implementing high impact targeted (HIT) practices on 3 million acres of National Forest and private working lands in priority landscapes. FY 2010 FY 2011 Program Performance Measure Target Target CTA Wetlands created, restored or enhanced in priority TBD" TBD" landscapes, acres WRP Wetlands created, restored or enhanced in priority TBD" TBD" landscapes, acres 1 Targets for these measures will be established after the priority landscapes and HIT practices have been identified, estimated to occur in FY 2010. - - 301 Selected Past Accomplishments toward Achievement of the Key Outcome: 25-68 FY 2006 FY 2007 FY 2008 FY 2009 Program Performance Measure Actual Actual Actual Actual CTA Wetlands created, restored or enhanced, acres 65,344 62,093 72,806 67,233 wRP Wetlands created, restored or enhanced, acres 181,979 149,330 128,860 106,379 WRP º forest land, and wetlands protected 114,193 74,509 56,117 35,338 y conservation easements, acres Selected Accomplishments Expected at the FY 2011 Proposed Resource Level: - FY 2010 FY 2011 Program - Performance Measure Target Target | CTA Wetlands created, restored or enhanced, acres 51,300 51,300 WRP Wetlands created, restored or enhanced, acres 125,000 140,000 Farmland, forest land, and wetlands protected by WRP conservation easements, acres 100,000 110,000 Efficiency Measures: Program Efficiency Measure CO-CTA Acres of conservation applied per technical assistance staff year (full time equivalent) WRP Percent of WRP easements closed within 12 months of initial project application Percent of WRP projects fully restored within three years of closing the easement 302 25-69 Goal: Rural Communities create wealth so they are self-sustaining, repopulating and thriving economically. 2009 Actual 2010 Estimated increase 2011 Estimated Staff Staff Of Staff - Amount Years Amount Years Decrease Amount Year Discretionary: - Snow Survey and Water - Supply Forecasting - 5,403,000 38 5,482,000 32 +48,000 5,530,000 3 Flood Prevention Operations P.L.-534 - - - 1. Technical Assistance 465,000 6 515,000 6 -515,000 - 2. Financial Assistance 3,356,000 gº 2,058,000 ** 2,058,000 -*. Subtotal, P.L.-534 3,824,000 5 2,573,000 6 -2,573,000 - Emergency Watershed Protection Program 1. Technical Assistance 7,250,000 68 ** 196 ** - 2, Financial Assistance 29,000,000 -- * - -º-º: * -- Subtotal, EWP 36,250,000 58 tº- 196 * -- Watershed Operations P, i.-586 1. Technical Assistance 17,102,000 41 3,516,000 141 -3,546,000 - 2. Financial Assistance 53,722,000 *- 8,911,000 ºs -8,941,000 a-ºº: - Subtotal, P.L.-566 80,824,000 41 12,427,000 144 -12,427,000 -- º Resource Conservation & - Development 50,730,000 412 50,730,000 412 -50,730,000 - Total, Discretionary 177,028,000 565 71,212,000 787 -65,682,000 5,530,000 3 Mandatory: Conservation Stewardship Program - 4,689,119 37 234,721,000 345 +80,027,000 314,748,000 24 Totai, Mandatory 4,689,119 37 234,724,000 345 +80,027,000 314,748,000 24 ºgº- Totai, Goal $181,717,119 602 S305,933,000 1,132 +$14,345.000 320,278,000 27 303 25-70 Goal: National forest & private working lands are conserved, restored and made more resilient to climate change and managed to enhance water resources. Discretionary: Conservation Technical Assistance Soil Survey Snow Survey and Water Supply Forecasting Plant Materiais Program Flood Prevention Operations F’, L.-534 1. Technica; Assistance 2. Financial Assistance Subtotal. P.L.-534 Emergency Watershed Protection Program 1. Technicat Assistance 2. Financial Assistance Subtotal, EVVP Watershed Operations P.A.-566 1. Technical Assistance 2. Financial Assistance Subtotal, P, i.-566 Watershed Rehabilitation 4. Technical Assistance 2. Financial Assistance Subtotal, Rehabilitation Total, Discretionary Mandatory: Wetlands Reserve Program Environmental Quality incentives Program Agricultural Water Enhancernent Program Wildlife Habitat incentives Program Farn and Ranch Lands Protection Program Conservation Security Program Conservation Stewardship Prograrr; Grasslands Reserve Program, Agricultural Management Assistance Snail VVatershed Rehabilitation Program Chesapeake Bay Watershed Frogram Healthy Forests Reserve Program {Conservation Reserve Program Total, Mandatory Total, Goal 2009 Actual 2010 Estimated increase 2011 Estimated Staff Staff or Staff Arnount Years Amount Years Decreasa Aſºloint Years. $739,437,000 5,529 $771,637,000 5,702 +$34,885,000 $306,522,000 5,380 92.229,000 696 93.939,000 707 +4,01 t.000 94,950,000 672 5,403,000 38 5,483,903 31 +47,000 5,530,000 30 5,464,000 50 5,544,000 50 +54,000 5,598,000 47 464,000 6 515,000 7 -515,000 - -- 3,356,900 * 2,058,999 * 2,058,000 * * ** 3,820,000 6. 2,573,000 7. -2,573,000 ** --- 24,750,000 205 * 589 * -- - 87.590,000 * * - tº ſº, * ºrvº. i O3,750,000 206 - 589 -- * gº 17, to 2,000 41 3,516,000 141 -3,516,000 -- --- 53,722,000 º 8,911,000 * 3,911,000 amº * 80.824,000 44 12,427,000 + 4 + ~42,427,000 * * 40,905,000 72 17,200,000 99. +336,000 17,536,000 29 49,095,000 * 22,961,000 -- ** 22,96t,000 --- 39,000,000 72 40,151,099 99 its 35,900 - #9,497,900 29 3,125,927. Gö0 6.638 S34.784,000 7,326 24.333,000 953,097,000 G,158 435,711,343 191 613,115,000 256 - 10,889,000 502,226,000 284 t,054,581,563 2,395 i.180,000,000 3,290 +28,000,000 1,208,000,000 2,5+ O. 71,803.404 66 73,000,000 151 +1,000,000 74,000,000 * 52 72,742,931 128 85,000,000 f 52 ~12,000,000 73,000,000 143 + tº.786,174 34 150,000,000 59 +40,000,000 160,000,000 54 276,004,48t 220 233,963,000 #52 –21,521,000 242,442,000 +38 4,689,120 38 234,721,000 345 +80,028,000 314,749,000 242 47,658,102 30 too,744, GOO 42 –21,638,000 79,076,000 42 7.378,139 9 7,500,000 27 –5,000,000 2,500,000 13 21.841,618 25 43,000,000 83 +29,000,000 72,000,000 174 2,526,172 5 9,750,000 19 * 9,750,000 £ 4 55,943,833 53.8 83,439, OCG 7.59 +40,777,000 124,216,000 1,423 2,169,615,847. 3.679_2.313.292,000 5,336 +47,757,990 2.831,959,000 4.885 $3,295,543,847 to,317 $3,745,966,000 12,662 $39,090,000 $3,785,056,000 1 1,043 304 25-71 Goal: America ieads the world in crop production and biotech crop exports. 2009 Actual 2010 Estimated increase 2011 Estimated Saff Staff Of Staff Amount Years. Amount Years Decrease Amount Years Goal Crop production and biotech crop exports Discretionary: - - Plant Materials Program $5,464,000 54 $5,544,000 51 +$55,000 $5,599,000 48 Total, Discretionary 5,464,000 51 5,544,000 51 +55,000 5,599,000 48 Total, Goa; $5,464,000 51 $5,544,000 51 +$55,000 $5,599,000 48 305 25-72 NATURAL RESOURCES CONSERVATION SERVICE Summary of Budget and Performance - Key Performance Outcomes and Measures Goal: USDA will assist rural communities to create wealth so they are self-sustaining, repopulating and thriving economically. - Key Outcome 2 - Water Quality: The quality of surface water and groundwater is improved and maintained to protect human health, support a healthy environment, and enable productive use of the land. Water running off or infiltrating the ground from agricultural operations can carry a number of potential pollutants into streams, lakes, groundwater, and estuaries. States and Tribes have identified sediment and nutrients as the most extensive agricultural contaminants affecting surface water quality; nutrients and agrichemicals are the major concerns for groundwater. NRCS sets long-term targets for reducing the potential of sediment and nutrients to move from agricultural operations. Long-term measures are supported by annual measures for application of conservation practices that reduce erosion and runoff and movement of nutrients. Long-term Performance Measures: • Reduce potential sediment delivery from agricultural operations. Target: By 2015, potential sediment delivery from agricultural operations will be reduced by an additional 37.5 million tons. Baseline: In FY 2003, potential sediment delivery from agricultural operations was 970 million tons. • Reduce potential nitrogen delivery from agricultural operations. Target: By 2015, potential delivery of nitrogen from agricultural operations will be reduced by an additional 215,000 tons. Baseline: In FY 2003, potential annual nitrogen delivery from agricultural operations was an estimated 6 million tons. • Reduce potential phosphorus delivery from agricultural operations. Target: By 2015, potential delivery of phosphorus from agricultural operations will be reduced by an additional 37,500 tons. - Baseline: In FY 2003, potential annual phosphorus delivery from agricultural operations was an estimated 360,000 tons. Key Performance Targets FY2006 TFY2007 TFY2005 TFY2009 TFY2010 TFY20:1 Performance. Measure Actual Actual Actual Actual Target Target Jobs created or retained in rural communities through effective natural resource and community planning efforts, number - RC&D 7,204 8,226 9,094 7,843 7,500 0. Performance measure to be - developed - CStP N/A N/A N/A N/A TBD TBD Description of annual performance measures: - * Jobs created or retained in rural communities through effective natural resource and community planning efforts. The number of jobs either created or retained by RC&D projects. This does not include RC&D Coordinator positions, and does not include seasonal jobs. 306 25-73 Key Outcome 3 - Water Quantity: Water is conserved and protected to ensure an abundant and reliable supply for the Nation. Agriculture is one of the largest users of the Nation's surface water and groundwater, with irrigation being the greatest use. In arid and semi-arid areas, crop production depends almost entirely on irrigation. - Competition for water in these areas is increasing as a result of increased human populations. In recent years, irrigation has been increasing in eastern States, resulting in increased competition among users. NRCS has set a long-term target for the conservation of water. The long-term measure is supported by an annual measure for the application of practices that improve the management of irrigation water. Long Term Performance Measures: Target: By 2015, farmers and ranchers will establish conservation measures that conserve an additional 6.25 million acre-feet of water. Baseline: In 2005, an estimated 2.5 million acre-feet of water were conserved. Key Performance Targets Performance Measure FY 2006 FY 2007 FY 2008 FY 2009 FY 2010 FY 2011 - Actual Actual Actual Actual Target Target_ Flood prevention or mitigation measures installed, number PL-566 117 106 74 20 45 135 Water supply forecasts issued, number * - CO-Snow Survey 11,534 12,141 12,505 12,399 11,400 11,400 Description of annual performance measures: • Flood prevention or mitigation measures installed. The number of flood prevention or mitigation measures installed during the fiscal year for the purpose of flood damage reduction. This measure included both structural and non-structural measures. • Water supply forecasts issued. The total number of water supply forecasts issued within the fiscal year by the Snow Survey and Water Supply Forecasting program. Goal: USDA will ensure our national forests and private working lands enhance our water resources and are conserved, restored, and made more resilient to climate change. Key Outcome 1 – High-quality, Productive Soils: The quality of intensively used soils is maintained or enhanced to enable sustained production of a safe, healthy and abundant food and fiber supply. Soil quality describes the capacity of a soil to sustain plant and animal productivity, maintain or enhance water and air quality, and support human health and habitation. High-quality soils are the foundation of productive croplands, forest lands, and grasslands and a vibrant and productive agriculture. NRCS provides landowners and land users with assistance in adopting environmentally sound management practices. NRCS provides information on soil quality, plant materials, resource management and provides assistance in using the information to implement sustainable production techniques and new technologies. Land managers who receive NRCS technical assistance are more likely to plan, apply, and maintain conservation systems that support agricultural production and environmental quality as compatible goals. 307 25-74 Long-term Performance Measures: Target: By 2015, farmers will manage 70 percent of cropland under systems that maintain or improve soil condition and increase soil carbon. Baseline: In 2003, 60 percent of cropland was farmed under systems that maintained or improved soil condition and increased soil carbon. Key Performance Targets: FY2010 Performance Measure FY 2006 || FY 2007 | FY 2008 FY 2009 FY 2011 Actual Actual Actual Actual Target Target Cropland with conservation applied to improve soil quality, million acres CO-CTA 6.4 7.3 8.3 7.6 7.5 7.7 EQIP 3.4 5.3 5.6 4.8 5.0 5.0 Prime, unique or important farmland protected from conversion to non-agricultural uses by conservation easements, acres - FRPP 46,909 38,495 27,401 38,260 40,000 45,000 Description of annual performance measures: • Cropland with conservation applied to improve soil quality, million acres. Controlling erosion, minimizing soil disturbance and compaction, and managing plants and soil organic matter are all essential to maximizing soil quality and function for agricultural and environmental benefits. This measure captures the cropland acres on which conservation practices have been applied to improve soil quality, as measured in millions of acres. * Prime, unique or important farmland protected from conversion to non-agricultural uses by conservation easements, acres. Prime, unique and important farmlands are those that have the best combination of physical and chemical characteristics for producing food, feed, fiber, forage, or oil seed crops. This measure documents the cumulative acreage of prime, unique and important farmlands that are permanently protected from conversion to non-agricultural uses. This measure reports on acres of prime, unique and important soils protected by permanent easements annually registered at the courthouse. Key Outcome 2 - Water Quality: The quality of surface water and groundwater is improved and maintained to protect human health, support a healthy environment, and enable productive use of the land. Water running off or infiltrating the ground from agricultural operations can carry a number of potential pollutants into streams, lakes, groundwater, and estuaries. States and Tribes have identified sediment and nutrients as the most extensive agricultural contaminants affecting surface water quality; nutrients and agrichemicals are the major concerns for groundwater. NRCS sets long-term targets for reducing the potential of sediment and nutrients to move from agricultural operations, Long-term measures are supported by annual measures for application of conservation practices that reduce erosion and runoff and movement of nutrients. Long-term Performance Measures: • Reduce potential sediment delivery from agricultural operations. Target: By 2015, potential sediment delivery from agricultural operations will be reduced by an additional 37.5 million tons. - Baseline: In FY 2003, potential sediment delivery from agricultural operations was 970 million tons. 308 25-75 • Reduce potential nitrogen delivery from agricultural operations. Target: By 2015, potential delivery of nitrogen from agricultural operations will be reduced by an additional 215,000 tons. Baseline: In FY 2003, potential annual nitrogen delivery from agricultural operations was an estimated 6 million tons. • Reduce potential phosphorus delivery from agricultural operations. Target: By 2015, potential delivery of phosphorus from agricultural operations will be reduced by an additional 37,500 tons. Baseline: In FY 2003, potential annual phosphorus delivery from agricultural operations was an estimated 360,000 tons. Key Performance Targets Performance Measure FY 2006 || FY 2007 || FY 2008 || FY 2009 | FY 2010 | FY 2011 Actual Actual Actual Actual Target Target Comprehensive Nutrient Management Plans applied, number CO-CTA 2,269 1,911 1,745 1,485 1,300 1,300 EQIP 2,774 2,490 2,520 2,019 2,000 2,000 Land with conservation applied to improve water quality, acres AWEP N/A N/A N/A 6,239 20,000 20,000 CBWP N/A N/A N/A 4,572 65,000 150,000 Description of annual performance measures: Comprehensive Nutrient Management Plans applied. A CNMP identifies management and conservation actions that will be followed to meet clearly defined soil and water conservation goals, including nutrient management on an animal feeding operation. A CNMP incorporates practices to utilize animal manure and organic by-products as a beneficial resource. CNMPs enable producers to manage collection, storage, and disposal of animal wastes in ways that minimize the potential for damage to the environment. Land with conservation applied to improve water quality. Land on which one or more conservation practices have been applied to improve quality during the fiscal year, measures in acres treated. 309 25–76 High Performance Priority Goals: Accelerate the protection of clean, abundant water resources by implementing high impact targeted (HIT) practices on 3 million acres of National Forest and private working lands in priority landscapes. Performance Measure FY 2006 || FY 2007 || FY 2008 FY 2009 || FY 2010 FY 2011 Actual Actual Actual Actual Target Target Priority landscapes with high impact targeted conservation practices applied to improve water quality, acres CO-CTA NA NA NA NA TBD" TBD" EQIP NA NA NA NA TBD" TBD" Performance measure to be - developed CStP NA NA NA NA TBD" TBD" *Targets for these measures will be established after the priority landscapes and HIT practices have been identified, estimated to occur by FY 2010. Key Outcome 3 — Water Quantity: Water is conserved and protected to ensure an abundant and reliable supply for the Nation. Agriculture is one of the largest users of the Nation's surface water and groundwater, with irrigation being the greatest use. In arid and semi-arid areas, crop production depends almost entirely on irrigation. Competition for water in these areas is increasing as a result of increased human populations. In recent years, irrigation has been increasing in eastern States, resulting in increased competition there also, NRCS has set a long-term target for the conservation of water. The long-term measure is supported by an annual measure for application of practices that improve the management of irrigation water. Long Term Performance Measures: Target: By 2015, farmers and ranchers will establish conservation measures that conserve an additional 6.25 million acre-feet of water. Baseline: In 2005, an estimated 2.5 million acre-feet of water were conserved. Key Performance Targets: Performance Measure FY 2006 || FY 2007 || FY 2008 FY 2009 FY 2010 FY 2011 Actual Actual Actual Actual Target Target Land with conservation applied to improve irrigation efficiency, acres CO-CTA 678,149 828,246 844,818 753,214 800,000 825,000 EQIP 758,923 883,033 1,048,319 1,131,159 1,100,000 | 1,000,000 AWEP N/A N/A N/A 2,850 50,000 55,000 Description of annual performance measures: • Land with conservation applied to improve irrigation efficiency. Irrigation makes a significant contribution to the United States farm economy. Improvements in irrigation water management can help to maintain the viability of the irrigated agricultural sector and help to protect water quality. This indicator reports the adoption of improved technology to replace older methods and other improvements to existing systems. 310 25-77 High Performance Priority Goals: Accelerate the protection of clean, abundant water resources by implementing high impact targeted (HIT) practices on 3 million acres of National Forest and private working lands in priority landscapes. FY2005 Performance Measure FY 2006 || FY 2007 FY 2008 FY 2010 FY 2011 Actual Actual Actual Actual Target Target Priority landscapes with high impact targeted conservation practices applied to improve irrigation efficiency, acres * CO-CTA NA NA NA NA TBD" TBD" EQIP NA NA NA NA TBD" TBD" *Targets for these measures will be established after the priority landscapes and HIT practices have been identified, estimated to occur by FY 2010. Key Outcome 4 – Clean Air: Farmers and ranchers make a positive contribution to local air quality. The quality of air affects every component of the natural system: soil, water, plants, animals, and people. As air quality and atmospheric change concerns increase, NRCS anticipates an expanded conservation focus on these issues. Many practices that protect soil and water also protect air quality. NRCS is revising and adapting conservation standards and specifications to better address air issues. NRCS will acquire and develop needed resource data and technology and encourage accelerated adoption of practices to address air quality concerns. Long-Term Performance Measures: Target: By 2015, farmers and ranchers will apply conservation measures to reduce annual soil losses from wind erosion by 7 percent. Baseline: In 2003, wind erosion accounted for more than 776 million tons of soil loss from cropland. Key Performance Targets: FY 2006 Performance Measure FY 2007 FY 2008 FY 2009 FY 2010 FY 2011 Actual Actual Actual Actual Target Target Land with conservation applied to reduce wind erosion, acres - . CO-CTA NA NA NA NA TBD" TBD" EQIP NA NA NA NA TBD" TBD" * This measure is under development. Targets for this measure will be established after the applicable conservation practices have been finalized. Description of annual performance measures: • Land with conservation applied to reduce wind erosion. Land on which one of more conservation practice has been applied to reduce wind erosion during the fiscal year, measured in acres. This measure is under development. The eligible practices and geographic range for this measure will be finalized in FY2010, and targets will be established starting in FY2011. Key Outcome 5 — Grassland and Rangeland Ecosystems: Grassland and rangeland ecosystems are productive, diverse, and resilient and provide a wide variety of environmental services. Healthy, vigorous plant communities on rangeland and native or naturalized pasture lands protect soil quality, prevent soil erosion, provide sustainable forage and cover for livestock and wildlife, provide fiber, improve water quality, provide diverse habitat for wildlife, and sequester carbon. Sustaining healthy 311 25-78 grassland and rangeland ecosystems is achieved by focusing on interacting relationships between plant and animal species within a given ecosystem and their relationship to the physical features and processes of their environment. NRCS provides data and technical and financial assistance to people interested in creating, restoring, protecting and enhancing grassland and rangeland. Long Term Performance Measure: Target: By 2015, farmers, ranchers, and other landowners will apply management that will maintain or improve long-term vegetative condition on 150 million acres of grazing land. Baseline: In 1999, about 300 million acres of non-Federal grazing land were considered to be in minimal or degrading vegetative condition. Key Performance Targets: FY 2006 || FY2007 : FY 2008 || FY2009 || FY2010 || FY2011 Performance Measure Actual Actual Actual Actual Target Target Grazing land with conservation applied to protect the resource base, million acres CO-CTA 11.8 14.2 16.0 16.0 14.0 14.0 EQIP 12.2 16.5 Í6.9 17.2 14.3 14,3 Note: Starting in FY2010, the former performance measure that covered grazing land and forest land has been split into two distinct measures, one for grazing land and one for forest land. The data reported above for FY2006-2009 include forest land; the targets for FY2010-2011 do not. Description of annual performance measures: * Grazing land with conservation applied to protect the resource base. This measure includes land on which a conservation system or practice is applied with NRCS technical assistance and/or financial assistance. The conservation applied includes a wide range of practices tailored to the resource conditions and producer’s operation and goals on the specific site. This measure is acres (in millions) of grazing land on which conservation practices have been applied to protect the resource base. Key Outcome 6 — Forest Land Ecosystems: Healthy forest lands that are productive, diverse, and resilient and provide a wide range of ecosystem services. - Healthy, vigorous plant communities on forest lands protect soil quality, prevent soil erosion, provide fiber, improve water quality, provide diverse habitat for wildlife, and sequester carbon. Sustaining healthy forest ecosystems is achieved by focusing on interacting relationships between plant and animal species within a given ecosystem and their relationship to the physical features and processes of their environment. NRCS provides data and technical and financial assistance to people interested in creating, restoring, protecting and enhancing forest lands. Long Term Performance Measure: Target: By 2015, non-industrial private forest landowners will apply management that will maintain or improve vegetative condition and protect and enhance ecosystem services on 9 million acres of non- industrial private forest land that are considered to have minimal or degrading vegetative conditions. Baseline: In 2003, about 200 million acres of non-industrial private forest land were considered to be in minimal or degrading vegetative condition due to overstocking, invasive species, wildfire damage, insects, hurricane damage, or other factors. - * - 312 25-79 Key Performance Targets: Performance Measure FY 2006 FY 2007 || FY 2008 || FY 2009 FY 2010 | FY 2011 I"Idºlſº § Actual Actual Actual Actual Target Target Forest land with conservation . applied to protect and improve vegetative condition, acres - - CO-CTA NA NA NA NA 600,000 600,000 EQIP NA NA NA NA 700,000 700,000 Note: Starting in FY2010, the former performance measure that covered grazing land and forest land has been split into two distinct measures, one for grazing land and one for forest land. Description of annual performance measures: • Forest land with conservation applied to protect and improve vegetative condition. This measure - includes non-industrial private forest land on which a conservation system or practice is applied with NRCS technical assistance and/or financial assistance. The conservation applied includes a wide range of practices tailored to the resource conditions and producer’s operation and goals on the specific site. The measure is acres of non-industrial private forest actively managed with conservation practices that protect and improve vegetative condition. Key Outcome 7 — Fish and Wildlife Habitat: Working lands and waters provide habitat for diverse and healthy wildlife, aquatic species, and plant communities. Privately-owned and other non-Federal lands provide habitat for much of the Nation’s wildlife. Protecting specific ecosystems and landscapes — including wetlands, grasslands, floodplains, and certain types of forests — can help support wildlife and aquatic species and provide benefits in the form of recreation, hunting, and other forms of agri-tourism. NRCS provides technical and financial assistance to maintain and enhance fish and wildlife habitat on non-Federal lands. Long-Term Performance Measures: Target: By 2015, farmers, ranchers, and non-industrial private forest landowners will implement conservation measures to improve an additional 8.5 million acres of essential habitat to benefit at-risk or declining species. Baseline: In 2005, farmers, ranchers, and other lando and at-risk species on 2 million acres. Key Performance Targets wners and managers improved habitat for declining Performance Measure FY 2006 FY 2007 FY 2008 || FY 2009 FY 2010 FY 2011 Actual Actual Actual Actual Target Target Non-Federal land with conservation applied to improve fish and wildlife habitat quality, acres - WHIP 175,543 388,769 || 316,896 || 335,402 || 350,000 | 400,000 Description of annual performance measures: • Non-Federal land with conservation applied to improve fish and wildlife habitat quality. The rural landscape provides critical habitat, food and safety for much of the Nation’s wildlife. Many of the conservation practices that farmers and ranchers apply to cropland and grazing land improves the habitat those lands provide for wildlife. The measure is acres of non-Federal land actively managed with conservation practices that protect and enhance fish and wildlife habitat. 313 25–80 Key Outcome 8 — Wetlands: Wetlands provide high quality habitat for migratory birds wildlife, protect water quality, and reduce flood damage. and other Wetlands provide wildlife habitat, protect and improve water quality, attenuate water flows due to flooding, and recharge ground water. NRCS will help protect and improve wetland resources by supporting voluntary incentive-based approaches to wetland restoration, making wetland determinations, and conducting wetland compliance reviews. Long-Term Performance Measures: Target: By 2015, farmers and ranchers will create, restore, or enhance an additional 1.25 million acres of wetlands on non-Federal lands. Baseline: In 2003, there were 111 million wetland acres on non-Federal lands in the contiguous United States. Key Performance Targets FY 2006 Performance Measure FY 2007 FY 2008 FY 2009 FY 2010 FY 2011 Actual Actual Actual Actual Target | Target Wetlands created, restored or . . enhanced, acres - CO-CTA 65,344 62,093 72,806 67,233 51,300 51,300 WRP 181,979 149,330 128,860 106,379 125,000 140,000 Farmland, forest land, and wetlands protected by conservation easements, acres WRP 114,193 74,509 56,117 35,338 100,000 110,000 Description of annual performance measures: • Wetlands created, restored or enhanced. Wetlands provide fish and wildlife habitat, reduce flooding, recharge groundwater, protect biological diversity, and improve water quality by filtering sediments and chemicals. This measure reports acres on which conservation practices have been applied to meet criteria in local field office technical guides. It includes only acres on which conservation was completed in a given fiscal year. It includes the wetland acres treated but not any associated upland acres treated or placed under easement to protect the wetland itself. It is, therefore, a more precise measure of changes in wetlands acreage than measures that include wetlands and associated uplands. • Farmland, forest land, and wetlands protected by conservation easements. This measure reports on acres enrolled under permanent and 30-year easements registered at the courthouse during the specified fiscal year. This measure reflects wetland acreage only; however WRP protects these wetlands by also placing associated upland acreage under easement. High Performance Priority Goals: Accelerate the protection of clean, abundant water resources by implementing high impact targeted (HIT) practices on 3 million acres of National Forest and private working lands in priority landscapes. Performance Measure FY 2006 FY 2007 || FY 2008 FY 2009 FY 2010 FY 2011 Actual Actual Actual Actual Target Target Wetlands created, restored or enhanced in priority landscapes, acres CO-CTA NA NA NA NA TBD" TBD" WRP NA NA NA NA TBD" TBD" 'Targets for these measures will be established after the priority landscapes and HIT practices have been identified, estimated to occur by FY 2010. 314 25-81 Goal: USDA will help America promote agricultural production and biotechnology exports as America works to increase food security. Key Outcome 2 - Water Quality: The quality of surface water and groundwater is improved and maintained to protect human health, support a healthy environment, and enable productive use of the land. Water running off or infiltrating the ground from agricultural operations can carry a number of potential pollutants into streams, lakes, groundwater, and estuaries. States and Tribes have identified sediment and nutrients as the most extensive agricultural contaminants affecting surface water quality; nutrients and agrichemicals are the major concerns for groundwater. NRCS sets long-term targets for reducing the potential of sediment and nutrients to move from agricultural operations. Long-term measures are supported by annual measures for application of conservation practices that reduce erosion and runoff and movement of nutrients. Long-term Performance Measures: • Reduce potential sediment delivery from agricultural operations. Target: By 2015, potential sediment delivery from agricultural operations will be reduced by an additional 37.5 million tons. - - Baseline: In FY 2003, potential sediment delivery from agricultural operations was 970 million tons. • Reduce potential nitrogen delivery from agricultural operations. Target: By 2015, potential delivery of nitrogen from agricultural operations will be reduced by an additional 215,000 tons. - Baseline: In FY 2003, potential annual nitrogen delivery from agricultural operations was an estimated 6 million tons. • Reduce potential phosphorus delivery from agricultural operations. Target: By 2015, potential delivery of phosphorus from agricultural operations will be reduced by an additional 37,500 tons. - Baseline: In FY 2003, potential annual phosphorus delivery from agricultural operations was an estimated 360,000 tons. º Key Performance Targets FY 2006 | FY 2007 || FY 2008 || FY 2009 | FY 2010 | FY 2011 Performance Measure Actual Actual Actual Actual Target Target Plant materials technical documents written and released to the public, number CO-Piant Materials 427 459 435 436 340 340 Description of annual performance measures: t - * Plant materials technical documents written and released to the public. Plants and plant technologies are important tools to meet evolving natural resource conservation needs. This measure tracks the number of technical documents that are developed and made available to internal and external customers to enable effective use of plants developed by NRCS, 315 25-82 NATURAL RESOURCES conservation SERVICE _Full Cost by Secretary's Strategic Prioriti --- -- - --- - - - - º --- - º Natural Resource Inventory and Assessment 3,691 3,746 3,778 Indirect Costs 1,712 1,736 1,752 Total Costs 5,403 5,482 5,530 FTEs 38 32 31 Performance measure: Water supply forecasts issued Performance, number 12,399 11,400 11,400 º entiºn ºperations ºf º º º Conservation Planning and Technical Consultation 22 25 0 Conservation Implementation 56 62 d Financial Assistance-Program Administration 3 4 0. Financial Assistance - Cost Share & Monetary Incentives 3,357 2,057 0. Indirect Costs 383 425 0 Total Costs 3,821 2,573 0 FTES 6 6 o Performance measure: Flood prevention or mitigation measures installed Performance, number - 1 5 14 Watershed operatiºs P.E.5& º - º --- º Conservation Planning and Technical Consultation 1,879 387 0 Conservation Implementation 9,009 1,852 o Financial Assistance-Program Administration 660 136 0 Financial Assistance - Cost Share & Monetary Incentives 63,721 8,910 0 Indirect Costs 5,555 1,142 0 Total Costs 80,824 12,427 0. FTEs 41 141 0. Performance measure: Flood prevention or mitigation measures installed Performance, number 20 45 135 Conservation Implementation 5,293 0 - Financial Assistance-Program Administration 1,015 o - Financial Assistance-Cost Share & Monetary Incentives 28,999 0 - Indirect Costs 943 0 - Total Costs 36,250 0 - FTEs. 68 196 - 316 25–83 NATURAL RESOURCES CONSERVATION SERVICE Full Cost by Secretary's Strategic Prioriti - º _PROGRAM ITEMS. Conservation Planning and Technical Consultation 21,364 0. Conservation Implementation 19,355 d Indirect Costs 10,011 0 Total Costs 50,730 () FTES 412 0 Performance measure: Jobs created or retained in rural communities through effective natural resource and community planning efforts Performance, number 7,843 7,500 - --- - º - - º - Total Costs 177,029 71,212 FTEs 565 787 Conservation Planning and Technical Consultation 199 1,814 1,389 Conservation Implementation 260 2,379 1,821 Financial Assistance-Program Administration 1,043 9,538 7,300 Financial Assistance - Cost Share & Monetary Incentives 0 191,765 281,873 Indirect Costs 3,188 29,226 22,367 Total Costs 4,689 234,721 314,749 FTEs 37 345 - 241 Performance measure: Under development NA TBD Ted Performance, Total costs "ass, 2347; FTEs 37 345 24! - - º - Total Costs 181,718 305,933 320,279 FTES 602 1,132 272 317 25-84 NATURAL RESOURCES Conservation SERVICE Full Cost by Secretary's Strategie Priorities - tº enhance sº [ AMOUNT (S000) PROGRAM ITEMS TFY2009 TFY2010TTFY2011_ Technical Assistance Conservation Planning and Technical Consultation 177,182 184,898 193,257 Conservation Implementation 97,105 101,334 105,915 Natural Resource Inventory and Assessment 12,260 12,794 13,372 Natural Resource Technology Transfer 77,811 81,199 84,870 Indirect Costs 375,079 391,412 409,108 Total Costs 739,437 771,637 806,522 FTES 5,529 5,702 5,380 Performance measure: Priority landscapes with high impact targeted conservation practices applied to improve water quality Performance, acres NA TBD TBD Performance measure: Comprehensive nutrient management plans applied Performance, number of plans 1,485 1,300 1,300 Performance measure: Land with conservation applied to improve irrigation efficiency Performance, acres 753,214 800,000 825,000 Performance measure: Priority landscapes with high impact targeted conservation practices applied to improve irrigation efficiency Performance, acres NA TBD TBD Performance measure: Cropland with conservation applied to improve soil quality Performance, million acres 7.6 7.5 7.7 Performance measure: Grazing and forestland with conservation applied to protect and improve the resource base Performance, million acres 16.0 NA NA Performance measure: Grazing land with conservation applied to protect the resource base Performance, million acres NA 14.0 14.0 Performance measure: Forest land with conservation applied to protect and improve vegetative condition Performance, acres NA 600,000 600,000 Performance measure: Wetlands created, restored or enhanced - Performance, acres 67,233 51,300 51,300 Performance measure: Wetlands created, restored or enhanced in priority landscapes Performance, acres NA TBD. TBD Natural Resource Inventory and Assessment Natural Resource Technology Transfer Indirect Costs 33,417 Total Costs 92,229 93,939 94,950 FTEs 696 707 672 Performance measure: Soil surveys mapped or updated Performance: million acres 37.5 38.0 40.0 3.18 25–85 NATURAL RESOURCEs-Conservation SERVICE ull Cost by Secretary's Strategic Priorities -º-º-º-º-º- - - - - - --------- | -AMOUNTS000, PROGRAM FY 2009 FY 2010 FY 2011 Natural Resource Inventory and Assessment 3,691 3,746 3,778 Indirect Costs 1,712 1,737 1,752 Total Costs 5,403 5,483 5,530 FTES 38 31 30 Performance measure: Water supply forecasts accuracy Performance, index 0.58 0.58 0.58 Natural Resource Inventory and Assessment Natural Resource Technology Transfer 2,294 2,328 2,351 Indirect Costs 2,507 2,543 2,568 Total Costs 5,464 5,544 5,598 FTEs 50 50 47 Performance measure: New plantimaterials released to commercial growers Performance, number 16 15 13 F. -- i Prs fe --ºº: Pºš34 sº Conservation Planning and Technical Consultation 0 Conservation implementation 0. Financial Assistance-Program Administration 0. Financial Assistance-CostShare & Monetary Incentives 3,356 2,057 0. Indirect Costs 383 425 0. Total Costs 3,820 2,573 0 FTes 6 7 0 Performance measure: Long-term contracts completed during the fiscal year (all measures installed) for the purpose of water quality improvement Performance, number 34 5 5 Conservation Planning and Technical consultation 0. Conservation Implementation 0. Financial Assistance-Program Administration o Financial Assistance-Cost Share & Monetary Incentives 63,721 8,910 0 Indirect Costs 5,555 1,442 0. Total Costs 80,824 12,427 0 FTES 41 141 o Performance measure: Long-term contracts completed during the fiscal year (all measures installed) for the purpose of water quality improvement Performance, number 65 20 15 319 25-86 NATURAL RESOURCES CONSERVATION SERVICE ull Cost by Secretary's S º º #Watershed Prºtection Pro - Conservation Implementation 15,878 0 0. Financial Assistance-Program Administration 3,045 0. 0 Financial Assistance - Cost Share & Monetary Incentives 86,999 0 0 Indirect Costs 2,828 0 0 Total Costs 108,750 0 0 FTEs 206 589 0. º º -- -------- º º º Conservation Planning and Technical Consultation Conservation Implementation Financial Assistance-Program Administration Financial Assistance - Cost Share & Monetary Incentives Indirect Costs Total Costs FTEs Performance measure: Unsafe dams rehabilitated or removed Performance, number 7 25 30 Performance measure: Dams with watershed rehabilitation plans authorized Performance, number Total Costs 931,764 FTES 6,638 7,326 - -T: º - º º º sº - Conservation Planning and Technical Consultation 2,886 3,227 Conservation Implementation 11,791 15,534 17,367 Financial Assistance - Program Administration 10,370 13,662 15,274 Financial Assistance- Cost Share & Monetary Incentives 404,941 572,578 456,905 Indirect Costs 6,418 8,455 9,453 Total Costs 435,711 613,115 502,226 FTEs 191 256 281 Performance measure: Wetlands created, restored or enhanced Performance, acres 106,379 125,000 140,000 Performance measure: Wetlands created, restored or enhanced in priority landscapes Performance, acres NA TBD TBD. Performance measure: Farmland, forestland, and wetlands protected by conservation easements Performance, acres 35,338 100,000 110,000 Conservation planning and Technical consultation 320 25-87 NATURAL RESOURCES Conservation SERVICE º º - - º - AMOUNT (S000) PROGRAM ITEMs FY 2009 FY 2010 FY 2011 ºsitºves Prºgramsº ºf ºf Conservation Planning and Technical Consultation 19,132 25,190 20,02. Conservation Implementation 99,117 130,503 103,73 Financial Assistance-Program Administration 66,540 87,611 69,63: Financial Assistance-Cost Share & Monetary Incentives 757,389 788,698 896.96 Indirect Costs 112,404 147,998 117,63 Total Costs 1,054,582 1,180,000 1,208,00 FTES 2,395 3,290 2.51 Performance measure: Priority landscapes with high impact targeted conservation practices applied to improve water quality Performance, acres NA Ted Te Performance measure: Comprehensive nutrient management plans applied Performance, number 2,019 2,000 2,00 Performance measure: Land with conservation applied to improve irrigation efficiency Performance, acres 1,131,159 1,100,000 1,000,00 Performance measure: Priority landscapes with high impact targeted conservation practices applied to improve irrigation efficiency Performance, acres NA Ted te Performance measure: Cropland with conservation applied to improve soil quality Performance, million acres 4.8 5.0 5. Performance measure: Grazing and forestland with conservation applied to protect and improve the resource base Performance, million acres 17.2 NA NA Performance measure: Grazing land with conservation applied to protect the resource base Performance, million acres NA 14.3 14 Performance measure: Forestland with conservation applied to protect and improve vegetative condition Performance, acres NA 700,000 700,00 Conservation Implementation Financial Assistance-Program Administration Financial Assistance-CostShare & Monetary Incentives 41,042 88,774 67,74 Indirect Costs - 520 939 89. Total Costs 47,658 100,714 79,07 FTES 30 42 4 Performance measure: Farmland and grazing lands protected by conservation easements Performance, acres 1,094 50,000 40,00ſ 321 25-88 NATURAL RESOURCES conservation service Full Cost by - PROGRAM ITEMS Conservation Planning and Technical Consultation Conservation Implementation Financial Assistance-Program Administration Financial Assistance-Cost Share & Monetary Incentives 60,397 51,376 51,703 º iélife Habitatistestives Prºgram º º Indirect Costs 2,661 5,045 5,202 Total Costs 71,803 73,000 74,000 FTes 66 151 152 Performance measure: Land with conservation applied to improve irrigation efficiency Performance, acres 2,850 50,000 55,000 Performance measure: Land with conservation applied to improve water quality Performance, acres 6,239 20,000 20,000 Conservation Planning and Technical Consultation 2,672 Conservation Implementation 5,895 5,687 Financial Assistance-Program Administration 7,083 6,832 Financial Assistance - Cost Share & Monetary Incentives 52,146 64,457 53,131 Indirect Costs 4,849 4,836 4,678 Total Costs 72,743 85,000 73,000 FTES 128 152 143 Performance measure: Non-Federal land with conservation applied to improve fish and wildlife habitat quality Performance, acres 335,402 350,000 400,000 Financial Assistance-Program Administration 336 567 509 Conservation Implementation 18 30 27 Financial Assistance-Program Administration 3,828 6,456 5,793 Financial Assistance-Cost Share & Monetary Incentives 112,915 140,132 151,146 Indirect Costs 1,669 2,815 2,525 Total Costs 118,766 150,000 160,000 FTes 34 59 51 Performance measure: Prime, unique, or important farmland protected by conservation easements from conversion to non- agricultural uses Performance, acres 38,260 40,000 45,000 322 25-89 NATURAL RESOURCES CONSERVATION SERVICE Full Cost by Secretary's Strategic Priorities -º-º-º-º-º-º-º: -º-º-º-º- AMOUNT (S000) FY 2009 FY 2010 FY 2011 Conservation Planning and Technical Consultation 1,264 990 9. Conservation Implementation 1,657 1,298 1,2 Financial Assistance-Program Administration 6,647 5,205 4, Financial Assistance-Cost Share & Monetary Incentives 246,121 210,520 190,3 Indirect Costs 20,315 15,950 15,0 Total Costs 276,004 233,963 212, FTEs 220 152 1 Performance measure: Cropland that uses management practices to reduce nitrogen loading to surface and groundwater Performance, million acres 1.0 0.8 0 conservation Plaming and Technical Consultation Conservation Implementation 260 2,379 1,8 Financial Assistance-Program Administration 1,043 9,538 7.3 Financial Assistance - Cost Share & Monetary Incentives - 191,764 281,8 Indirect Costs 3,188 - 29,226 22,3 Total Costs 4,689 234,721 314,7 FTEs 38 346 2 Performance measure: Under development Performance, - Technical consulation - vation planning con Conservation Implementation Financial Assistance-Program Administration Financial Assistance - Cost Share & Monetary Incentives 6,181 6,126 1,5 Indirect Costs 141 162 1 ..Total Costs 7,378 7,500 2.5 FTES 9. 27 i Performance measure: Land with conservation applied to improve irrigation efficiency Performance, acres tº Conservation Planning and Technical Consultation Conservation Implementation Financial Assistance-Program Administration Financial Assistance-CostShare & Monetary Incentives 1,191 6,794 7.2 Indirect Costs 314 695 57 Total Costs 2,526 9,750 9,75 FTES 5 19 1 Performance measure: Non-Federal land with conservation applied to improve fish and wildlife habitat quality Performance, acres - 3,750 3,0ſ 323 25-90 NATURAL RESOURCES CONSERVATION SERVICE Full Cost by Secretary's Strategic Priorities ºº: - º ºs... ROGRAM PROGRAM ITEMS Conservation Planning and Technical Consultation 209 601 1,263 Conservation Implementation 1,083 3,115 6,544 727 2,091 4,393 Financial Assistance-Program Administration Financial Assistance - Cost Share & Monetary Incentives 18,595 33,659 52,379 indirect Costs 1,228 3,534 7,421 Total Costs 21,842 43,000 72,000 FTEs 25 83 171 Performance measure: Land with conservation applied to improve water quality Performance,acres 4,572 65,000 150,000 --- º * - tº--~~~~ - -- --- -- º Conservation Planning and Technical Consultation 17279- Conservation Implementation 17,242 25,730 Financial Assistance-Program Administration 17,497 26,110 38,870 Financial Assistance - Cost Share & Monetary Incentives - - - Indirect Costs 9,596 14,320 21,319 Total Costs 55,914 83,439 124,216 FTes 538 7.59 1,123 2,814,202 2,831,959 - 5,336 4,885 3,295,544 3,745,966 3,785,056 FTES 10,317 12,662 11,043 324 25-91 NATURAL RESOURCES CONSERVATION SERVICE PROGRAM__ Natural Resource Technology Transfer 2,294 2,328 2,35 Indirect Costs 2,507 2,543 2,56 Total Costs 5,464 5,544 5,59 FTEs 51 51 Performance measure: Technical documents written and transferred Performance, number - total costs total Costs FTES —º Total Costs rtes 26-1 RURAL DEVELOPMENT Available Funds and Staff Years 2009 Actual and Estimated 2010 and 201] Actual 2009 Estimated 2010 Estimated 20.1 ! Item - Staff Staff - Staff Amount Years Amount Years Amount Years Rural Community Facility Program Account aſ........................... $63,830,000 -- $54,993,000 - $44,717,000 ** Rural Housing Insurance Fund Program Account: Subsidy d!... 200,951,000 -- 238,908,000 - 127,331,000 -- Rural Housing Assistance Grants ef............................................. 41,500,000 -- 41,500,000 -- 40,400,000 ** Farm Labor Program # 18,269,000 -- 19,746,000 - 20,346,000 ** Rental Assistance Program g/ 902,500,000 -- 980,000,000 **r 965,635,000 •ºma- Rural Housing Voucher Program h!.............................................. 27,714,000 -- 43,191,000 - * 18,000,000 *sº Mutual and Self-help Housing Grants iſ....................................... 38,727,000 -- 41,864,000 -- 37,000,000 -- Rurai Water and Waste Disposal Program Account bi................ 538,768,000 -- 551,230,000 -wº- 534,414,000 * Rurai Electrification and Telecommunications - Program Account: Subsidy 525,000 - -- - -ºw -- Rural Telephone Bank Program Account: Subsidy ..................., *- -- ~~. -*. *** - Distance Learning, Telemedicine, and Broadband Program jf..... 63,780,000 - 84,691,000 -- 70,296,000 -- {Suaranteed Local Television Program Account........................... - - - -- - ** * High Energy Cost Grants ki 17,500,000 -- 17,500,000 ~~ -- -- Rural Business Program Account cf............................................. 87,385,000 -- 99,243,000 - 81,526,000 ** Rural Development Loan Fund Program Account: Subsidy,....... 14,035,000 ** 8,464,000 -*. 14,034,000 **: Rural Economic Development Loans Program Account: Subsidy H. (7,556,000] -- [4,346,549] -vº: {5,924.391] ** Rural Economic Development Grants Rescission......................... -20,000,000 -- 44,463,000 - -103,000,000 ** Rural Microentreprenuer Assistance Program............................ - *** * - 5,600,000 -- 7,700,000 sº Biorefinery Assistance Program • *- -- - - 17,300,000 ** Renewable Erlergy Program S,000,000 - 39,340,000 - 39,340,000 -- Rurai Cooperative Development Grants my..............~~~~ a * H4,513,000 -- 37,854,000 - 40,054,000 ** Rural Emp 1. ^2 _ _ _ yr" . . a. Community Grants nſ......, 8,130,000 - 499,000 -4 - 4 - ** Subtotal, Ongoing Programs 2,023,127,000 -- 2,219,560,000 -- 1,952,093,000 - American Recovery and Reinvestment Act Authorities: Rural Community Facility Program Account....................... + wat “wº 42,808,000 -- 193,147,000 -- -- ** Rural Housing insurance Fund Program. Account: Subsidy........ 131,353,000 - 62,647,000 - - * Rural Water and Waste §isposal Program Account..................... 444,925,000 -- 1,395,714,000 w- -wº -- Distance Learning, Telemedicine, and Broadband Program......... 0 – 2,425,000,000 -- --- assº Rural Business Program Account $8,941,000 wº- 126,559,000 ww. * * ** Salaries and Expenses 35,250,000 - 95,550,000 Subtotal, American Recovery and Reinvestment Act Authori 673,277,000 -- 4,298,617,000 -- -- ** Farm Bifi Authorities: Rural Microentreprenuer Assistance Program,............................. 4,000,000 -- 4,000,000 -- 4,000,000 -- Biorefinery Assistance Program 75,000,000 - 245,000,000 -w - ww. Energy Assistance Payment 90,000,000 -- 55,000,000 - 85,000,000 -- Renewable Energy Program $5,000,000 -- 60,000,000 -- 70,000,000 -- Rural Cooperative Development Grants of.................................... 15,000,000 4-- - -- -- --- * * Subtotal, Farm Biłł Aut 239,000,000 -- 364,000,000 - 159,000,000. ** (325) 326 26–2 Salaries and Expenses pſ - 696,799,000 5,873 715,480,000 6,100 730,060,000 6,1 Total, Salaries and Expenses & Program Resources..................... 935,799,000 5,873 1,079,480,000 6,100 889,060,000 6, 1 Qbligations under other USDA Appropriations: Reimbursements from: - Farm Service Agency - 6,086,512 * - 7,000,000 -- 8,000,000 Natural Resources & Conservation Service.........................….. 686,853 ** 1,000,000 . -- 1,000,000 Office of the Chief Information Officer 1,500,081 -- 2,000,000 -- 3,000,000 Foreign Agriculture Services 24,163 *- 100,000 -- 500,000 Miscellaneous Reimt A. 2,482,501 * - 4,000,000 -* 3000,000 Total, Other USDA appropriations 10,780,410 -- 14,100,000 -- 17,500,000 Total, Agriculture Appropriations 2,730,706,110 5,873 5,028,197,000 6,100 2,699,653,000 6,! Rural Economic Development Loans qſ........................................ 7,556,000 --- 4,316,549 --- 5,924,091 Rural Economic Development Grants q/...................................... 10,000,000 * - 10,000,000 -- 10,000,000 Other Federal Funds: - Appalachian Regional Commission Program f/........................... 13,290,852 * - - •- . - -º -- Delta Regional Authority Grants sh - . 300,000 -- -- -- -- NADBank ty - --- -- -- -- Economic Development Administrati ** * - - -4- - ** w- Federal Emergency Management Agency................................* * * * * * 871,126 * - - - -- Department of Interior 175,000 -- -- ** -- Subtotal, Other Federal Funds 14,636,978 *w- {} wº {} Total, Rurai Develop _ 2,745,343,088 5,873 5,042,513,549 6,100 2,699,653,000 , 6,. a/ Excludes $16,490,091.71 of unobligated balances and $4,198,000 in recoveries of prior year obligations which were available in FY 2009. Als b/ c/ h / Excludes $12,808,192.08 of unobligated balances and $1,300,000 in recoveries of prior year obligations which were available in FY 2009. excludes $26,888,250.78 of unobligated balances available in FY 2010, Excludes $40,000,000 in 2008 disaster appropriations and $12,000,00 transfer carryover of Kansas Tornado funds. Excludes $109,231,492.10 of unobligated balances and $47,556,000 in recoveries of prior year obligations which were available in FY 2009. Excludes $17,500,000 for high energy cost grants in FY 2009 and FY 2010. Excludes $278,634,315.49 in unobligated balances available in FY 2010. Excludes transfer of $1,000,000 in unobligated balances from the Secretary's Tornado funds. Excludes $25,000,000 in appropriated funds for 2008 disasters. ". - Excludes $8,562,994.35 of unobligated balances and $13,633,000 of recoveries of prior year obligations which were available in FY 2009. Excludes $22,475,129.35 of unobligated balances available in FY 2009. Excludes transfer of $100,000 in unobligated balances from the Secretary's Tornado funds. Excludes $25,000,000 in appropriated funds for 2008 disasters. Excludes $9,138,856.55 of unobligated balances and $9,140,000 in recoveries of prior year obligations which were available in FY 2009, Also excludes the transfer of $4,156,000 to the Working Capital Fund in FY 2009. Excludes $41,392,697.55 of unobligated balances available in FY 2010. Also excludes $46,000,000 in 2008 disasters appropriations, $23,000,000 transfer carryover of 2005 Hurricanes, and $1,065,000 in carryover transferred to RCFP in FY 2009. Excludes $ 10,801,128.81 of unobligated balances available in FY 2010. Also excludes $5,000,000 2008 disasters unobligated balance transfe Excludes $15,000,000 in 2005 Hurricanes disaster appropriation in FY 2009. Excludes $1,985,000 in carryover tornado funding transferred to RCFP, - Excludes $11,312,013.73 of unobligated balances and $656,000 in recoveries of prior year funds which were available in FY 2009. Excludes $730,776.97 of unobligated balances available in FY 2010. Excludes $402.09 of unobligated balances available in 2010. Excludes $21,299,207.89 of unobligated balances and $1,625,000 in recoveries of prior year obligations which were available in FY 2009, Al excludes the $3,710,953 in 2008 disasters appropriations. Excludes $13,197,03745 of unobligated balances available in FY 2010. 327 26–3 Excludes $3,313,304.52 of unobligated balances and $3,520,000 in recoveries of prior year obligations which were available in FY 2009. - Excludes $14,522,204.01 of unobligated balances available in FY 2010. Excludes $10,448,024.99 of unobligated balances and $11,423,000 in recoveries of prior year obligations which were available in FY 2009. Excludes $24,074,955.84 unobligated balances available in FY 2010, - Excludes $19,507,351.17 of unobligated balances which were available in FY 2009. Excludes $17,633,271.17 of unobligated balances which were available in FY 2010. - - Excludes $364,855.20 of unobligated balances and $3,526,000 in reoveries of prior year obigiations which were available in FY 2009. Excludes $652,072.76 of unobligated balances which were available in FY 2010. Excludes $1,790,407.50 of unobligated balances and $2,581,181 in recoveries of prior year obligations which were available in FY 2009. Excludes $7,043,090.09 in unobligated balances available in FY 2010. Also excludes $15,000,000 from the Farm Bill in FY 2009. Excludes $1,248,671.36 in unobligated balances which were available in FY 2009, Excludes $12,975\.36 in unobligated balances available in FY 2010. Excludes $1,005.249.20 of unobligated balances which were available in FY 2009. Excludes $15,597,162.72 in unobligated balances avaiiable in FY 2010. - Excludes $271,000.00 for Congressional Liaison Activities in FY 2009. Section 313 of the Rural Electrification Act provides the authority to make grants with the earnings generated from the interest differential on voluntary cushion of credit payments made by RUS borrowers. - Excludes $12,413,727.21 of unobligated balances available in FY 2009. Excludes $10,302,859.82 unobligated balances available in FY 2010, Excludes $68,895.00 of unobligated balances available in FY 2009. Excludes $89,463.48 of unobligated balances available in FY 2010. Excludes $351,233.39 of unobiigated balances which were available in FY 2009 and FY 2010. 328 26–4 RURAL DEVELOPMENT Permanent Positions by Grade and Staff Year Summary 2009 Actual and Estimated 2010 and 2011 2009 - 2010 *— Grade Wash DC Field Total Wash DC Field Total Wash DC Field Total Senior Executive - Service | 8 0 18 18 {) 18 } 8 0 # 8 SL-00 3 () 3 3 () 3 3 0 3 GS-15 59 34 93 59 34 - 93 59 34 93 GS-H4 95 32 127 99 32 1.31 99 32 | GS-13 377 445 822 397 445 842 397 44S GS-12 - 312 1,034 1,346 312 1,231 1,543 3.12 1,231 GS-1 115 660 775 115 660 775 | 15 660 GS-10 4. 1 S 4 1 5 4 1 GS-9 81 540 621 81 560 641 81 560 GS-8 77 30 107 77 30 07 77 30 GS-7 388 834 1,222 402 896 1,298 402 896 GS-6 - 71 255 326 71 255 326 71 255 GS-5. 41 184 225 41 184 225 4} # 84 GS-4 . 24 52 76 24 $2 76 24 52 GS-3 6 2 8 7 3 10 7 3 GS-2 2 } 3 2 ł 3 2 } WG-7 f () l 1 () 1 l {} WG-6 ! 0 i i {} I l 0 WG-4 i {} } i 0 ! } O WG-2 i 0 | I () l l () Ungraded Positions......... - - () - - () - - C Total Permanent Positions...... 1,677 4, 104 5,781 1,716 4,384 6,100 1,716 4,384 6,100 Unfilled Positions - end-of-year....................... 27 18 45 0 0 () () () Ö Total, Permanent - Full-Time Employment - end-of-year....................... 1,650 4,086 5,736 1,716 4,384 6,100 1,716 4,384 6,100 Staff Year Pºstimate 1,653 4,220 5,873 1,716 4,384 6,100 1,716 4,384 6,100 329 26-5 RURAL DEVELOPMENT MOTOR VEHICLE FLEET DATA Size, Composition, and Annual Cost (in thousands of dollars) Size, Composition, and Cost of agency motor vehicle fleet as of September 30, 2009 are as follows: Number of Vehicles by Type Sedans Total Annual Fiscal and Medium Heavy Number Operating Year Station Light Trucks, Duty Duty of Cost Wagons SUVs and Vehicles Ambulances Buses | Vehicles | Vehicles ($ in thous) Vans X2 || 4X4 FY 2008 7.59 194 15 1 0 {} {} 969 ; 4,668,120 Change from 2008** -23 43 2 0. 0 {} () 22 13,000 FY 2009 736 237 17 1 {) 0. 0 991 4,681,120 Change from 2009** 44 –43 _-2 () {} 0 () -1 13,000 FY 2010 780 194 15 1 0 {} 0. 990 || 4,694,120 Change from 2010** 0 {} () () 0. 0 () 0. 13,000 FY 2011 780 194 15 1 0. 0. {) 990 || 4,707,120 Vehicles. The passenger motor vehicles of Rural Development are used almost exclusively by Rural Development state field bffice staff (about 4,300) in order to provide program delivery to essential facilities, and services as water and sewer systems, housing, health clinics, emergency service facilities and electric and telephone service. In the course of |heir daily work these personnel often need to travel to individual farms, commercial firms, and State agricultural Experiment stations, which are only accessible by car. Rural Development's total motor vehicle fleet consists of 978 GSA leased, 1 commercial leased, and 12 owned 330 26-6 RURAL DEVELOPMENT The estimates include appropriation language for this item as follows (new language underscored; deleted matter enclosed in brackets): - Rural Development Salaries and Expenses (including transfers of funds) For necessary expenses for carrying out the administration and implementation of programs in the Rural Development mission area, including activities with institutions concerning the development and operation of agricultural cooperatives; and for cooperative agreements; [$217,880,000] $232,257,000: Provided, That notwithstanding any other provision of law, funds appropriated unde this section may be used for advertising and promotional activities that support the Rural Development mission area: Provided further, That not more than $10,000 may be expended to provi modest nonmonetary awards to non-USDA employees: Provided further, That any balances availabl from prior years for the Rural Utilities Service, Rural Housing Service, and the Rural Business- Cooperative Service salaries and expenses accounts shall be transferred to and merged with this appropriation. 331 26-7 RURAL DEVELOPMENT LEAD-OFF TABULAR STATEMENT SALARIES AND EXPENSES ppropriation Act, 2010 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . - - - * * * * * * - - * $715,480,000 udget Estimate, 2011 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 730,060,000 ncrease in Appropriation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . +14,580,000 =======: RURAL DEVELOPMENT SUMMARY OF INCREASES AND DECREASES (On basis of appropriation) - 2010 Program 2011 tem of Change Estimated Pay Costs Changes Estimated Salaries and Expenses. . . . . . . . . . . . . . . .* * * * - - - - - $709,480,000 $7,180,000 t $716,660,000 Regional Innovation Initiative . . . . . . . . . . . . * M & 4 {} - $1,400,000 },400,000 Common Computing Environment Refresh . . . . . {} 12,000,000 - 12,000,000 Maintain Portfolio Compliance. . . . . . . . . . . . . . . . 6,000,000 -6,000,000 {} Total Available. . . . . . . . . . . . . . . . . . . . . . . . . . 715,480,000 7,180,000 7,400,000 730,060,000 332 26–8 RURAL DEVELOPMENT SALARIES AND EXPENSES Project Statement by Program (On basis of availability) 2009 Actual 2010 Estimated 2’ 2011 Budget Staff Staff increase or Staf Amount Years Amount Years Decrease Amount Year i. Direct Appropriation $218,574,982 1,776 $313,632,553 1,685 -$81,375,553 $232,257,000 1,94 2. Rural Electrification and Telecommunications Loans Program. Account 39,245,000 319 39,959,000 344 -1,585,000 $38,374,000 32 3. Rural Housing Insurance Fund Program Account 460,217,000 3,739 468,593,000 4,029 -14,210,000 $454,383,000 3,79 | | 4. Rurai Development Loan | Fund Program Account 4,853,000 39 4,941,000 42 105,000 $5,046,000 Total Available or Estimate 722,889,982 5,873 827,125,553 *—?&— Unobligated balance, start of year: Supplemental Appropriation for Hurricane Recovery aſ -246,567 sº- - - Supplemental Appropriation for 2007 Emergency Disaster Assistance b/ -493,435 * - - Supplemental for Disaster Emergency Assistance cy {) -4,500,000 - Supplcmental Appropriation for - Recovery and Reinvestment Act, 2009 d. -35,249,447 - –95,550,553 -- Secretary's Interchange Transfer e! –2,190,056 - ess Unobligated balance transferred to 2010 for IT purposes f $1,595,000 -i 1,595,000 Unobligated balance expiring 493,523 - * * Total, Appropriation 696,799,000 5,873 715,480,000 6, iOG aſ Emergency Supplemental Appropriations Act for Defense, the Global war on Terror, and Hurricane Recovery, 2006, pursuant to P.L. 109-234. by Disaster Supplemental for U.S. Troop Readiness, Veterans' Care, Katrina Recovery and Iraq Accountability Appropriations Act, 2007, pursuant to P.L. t 19-28 cſ to P.L. 110-329. : } . Direct Appropriation 2. Rural Electrification and Telecommunications Loans Program. Account . Rural Housing Insurance Fund Program. Account . Rural Development Loan Fund Program. Account 3 4 Total Supplemental Appropriations for American Recovery and Reinvestment Act of 2009, pursuant to P.L. 111-5. Secretary's Interchange Authority, 7 U.S.C. 2257. Omnibus Appropriations Act, 2009, pursuant to Public Law it 1-8, General Provision 738. Supplemental Appropriations for the Consolidated Security, Disaster Assistance, and Continuing Appropriations Act, 2009, pursuant to Maintain Portfolio Rural C&H CCE £2ther Program - FY 2010 Pay Cost Compliance, etc Program Refresh Adjustments FY 2011 $201,987,000 $2,377,000 -$1,694,000 $1,400,000 $12,000,600 $16,187,000 $232,257,0 39,959,000 374,000 -335,000 O {} -1,624,000 38,374,0 468,593,000 4,383,000 -3,930,000 O 0. -14,663,000 454,383,00 4,941,000 46,000 –41,000 0. 0 100,000 5,046,0 715,480,000 lilº -6,000,000 1,400,000 12,000,000 {} 239,089,0. 333 26-9 RURAL DEVELOPMENT SALARIES AND EXPENSES JUSTIFICATION OF INCREASES AND DECREASES 1) An increase of $14,580,000 ($715,480,000 available in 2010) in salaries and expenses: (a) (b) (d) An increase of $7,180,000 to fund increased pay costs. The increase is needed to fund the FY 2011 pay raise at the assumed 1.4 percent rate for the first three quarters of calendar year 2011and the 2.1 percent cost of living change for the fourth quarter of calendar year 2010 for current staffing levels. An increase of $1,400,000 to fund the Regional Innovation Initiative. The budget request proposes to establish a Regional Innovation Initiative (RII). To help with the planning and coordination, RD will establish a Regional Innovation Council (RIC) comprising representatives from the Office of the Secretary and all USDA mission areas. A small office called the Office of Regional Innovation will be established within Rural Development to coordinate the work of the RIC across the Department. This office will be staffed with up to four full-time employees and provide up to five cooperative agreements or challenge grants for regional development activities. .” Under the Presidential and Secretarial principles set forth, RD will have a critical role in ensuring that rural areas are economically thriving and individuals in rural areas contribute to, and benefit from, the overall health of the American economy. Redeveloping economically struggling communities requires a community-based or regionally-based approach to long- term planning. RII recognizes that individual communities are often affected by linkages to other communities within regions and that working together can produce more prosperity for all. - - (c) A decrease of $6,000,000 for maintaining portfolio compliance, safety and soundness. Significant Information Technology infrastructure gains related to maintaining portfolio compliance, safety, and soundness were made through the investment of Recovery Act administrative funding in 2010. The proposed reduction is supported through the gains achieved in 2010, which will reduce the need for these investments in 2011. An increase of $12,000,000 for the Common Computing Environment (CCE) refresh. An increase of $12 million for the Common Computing Environment refresh is requested. The 2011 budget includes $12 million for the RD portion of the Departmental effort to modernize and upgrade the IT infrastructure (also known as the Common Computing Environment (CCE)) for the Service Center Agencies (SCAs). This funding will be used to replace outdated components of the CCE, many of which have exceeded their expected life cycles, to reduce system vulnerabilities to failure and improve the performance and effectiveness of the shared infrastructure. These improvements will allow the SCAs to better serve program participants with a more flexible and reliable IT infrastructure. This funding will allow for the first system-wide refresh of the CCE since the infrastructure was implemented in 2000. In addition, as the components of the CCE are replaced, USDA will implement a right-sizing process whereby configuration changes will be made to better support the delivery of current and future programs. As part of this process, the Department will strive to improve system security, reduce the long term cost of infrastructure services, and improve service reliability. 334 26-10 RURAL DEVELOPMENT Geographic Breakdown of Obligations and Staff Years 2009 Actual and Estimated 2010 and 2011 2009 2010 2011 Staff Staff Staff Araount Years Amount Years Amount Years A lahernº, $8,515,903 95 $8,898,591 115 $9,079,926 I H5 A}acka 3,198,003 34 3,341,715 38 3,409,812 38 Arizona 5,795,218 62 6,055,644 64 6,179,045 64 Arl 11,581,138 #23 12,101,571 132 12,348,176. $32 California.............. & s : * * * * * * * * * * * * * 13,057,185 13? 13,643,949 132 13,921,984 132 Crºlorado 5,332,376 57 5,572,002 53 5,685,548 58 C • *---a 1,316,388 14 1,375,544 14 1,403,575 14 Dei 3,458,738 36 3,614,167 37 3,687,816 37 District of Columbia............. 295,930,685 1,653 309,229,220 t,746 315,530,671 1,716 Florida 10,101,072 1 if 10,554,994 1 #2 10,770,083 1. i2. Georgia 12,258,094 127 12,808,948 129 13,069,968 #2% Hawaii 3,642,928 35 3,806,634 39 3,834,205 39 Irlahn 6,293,212 65 6,576,016 66 6,710,022 66 Illinois...........….............. 10,469,683 123 10,940,170 122 11,163,108 122 indiana 8,733,456 100 9,125,920 {{}{} 9,311,887 100 Iowa..................…... * * * * * * * * * * * * * 10,574,734 #12 11,049,941 1 iS i 1,275,116 1 15 Kansas 5,836,919 63 6,099,219 71 6,223,508 71 Kentucky 10,851,502 119 11,339,147 126 11,570,215 | 26 I - 9,589,898 105 10,020,849 # 1 {} 10,225,053 } 10 Maine ..........…....... * * * * * * * * * * 7,281,046 84 7,608,242 82 7,763,282 82 Maryland.….......…............ 1,623,238 18 1,696,183 #8 1,730,748 18 * Aſ t-------a 4,117,571 40 4,302,606 41 4,390,285 4} * Arf -1. 11,843,752 125 12,375,987 128 12,628,484 #28 * if: 4. 9,798,846 1 : {} 10,239,187 109 10,447,840 109 Tº º * T is 15,976,673 176 16,694,633 i80. 17,034,835 180 Missour; 12,573,087 14] 13,138,096 #43 $3,405,824 #43 * * ~--a 4,784,503 49 4,999,509 52 5,101,389 52 Nebrasi 6,242,776 67 6,523,314 67 6,656,246 67 Nevada.................................. 2,519,825 25 2,633,061 25 2,686,717 25 New Hampshire..................... 1,912,649 23 1,998,600 23 2,039,327 23 New Jersey............................ 4,139,726 44 4,325,757 47 4,413,907 47 New Mexico..........* * * * * * * * * * * * * * * * 4,284,718 44 4,477,265 53 4,568,502 53 New York.............................. 10,108,316 114 10,562,564 Hi5 10,777,807 } {5 North Carolina...................... #5,368,806 169 Ł6,059,450 174: 16,386,708 #74 North Dakota......................... 5,019,322 54 5,244,880 55 5,351,760 55 {}hin 10,009,901 #09 10,459,726 } ió 10,672,874 II (? Oklah 8,062,200 86 8,424,499 89 8,596,173 89 Oregon 5,502,786 66 6,795,008 72 6,933,476 72 Pennsylvania......................... 10,343,436 # () 10,808,249 114 £1,028,499 } {4 Puerto Rico.................... * * * * * * * 6,760,549 76 7,064,355 9 | 7,208,312 9i Rhode Island......... * * * * * * * * * * v- w triº ºr 427,232 5 446,431 5 455,528. 5 South Carolina........... raw a “* * * * * * 10,441,531 i i ; 10,910,753 { } {} 11,133,091 i i Q South Dakota......................... 6,496,923 74 6,788,882 73 6,927,225 73 Ten - 12,093,149 134 12,636,591 138 12,894,099 133 Texas 15,349,802 174 16,039,592 190 16,366,445 190 I ſtah 4,455,926 47 4,656,166 46 4,751,049 46 Vermont 3,916,411 37 4,092,407 40 4,175,804 40 Virginia 9,748,058 104 10,186,116 f{}6 10,393,683 {06 Washing - 6,795,699 72 7,101,084 74 7,245,790 74 West Virginia......................., 6,474,830 72 6,762,661 7 6,900,470 76 Tº rº * 8,019,911 96 8,380,310 i{}{} 8,551,083 100 Wyoming 3,183,854 35 3,326,930 39 3,394,726 39 Western Pacific Areas........... i,153,897 15 1,205,751 15 1,230,322 15 Virgin Islands........................ 345,395 4. 360,916 4 368,271 4 Subtotal, Available or Estimate............... * * * * * 684,710,476 5,873 715,480,000 6,100 730,060,000 6,400 Unobligated balance ...... 12,088,524 Total, Available or Estimate.................. $696,799,000 5,873 $715,430,000 6,100 $730,060,000 6,100 335 26-11 RURAL DEVELOPMENT Classification by Objects 2009 Actual and Estimated 2010 and 2011 FY 2009 FY 2010 FY 2011 Personnel Compensation: Washington, D.C. $126,750,986 $125,947,652 $127,792,834 Field 277,682,952 280,335,096 284,442,134 1 i Total personnel compensation 404,433,938 406,282,748 412,234,968 12 Personnel benefits 107,130,240 107,330,062 108,896,642 13 Benefits for former personnel 385,896 385,896 385,896 Total personnel compensation and benefits..................... 511,950,074 513,998,706 521,517,506 Other Objects: - 2} Travel and transportation of persons 13,399,155 14,004,781 14,083,459 22 Transportation of things - - 535,388 537,376 541,348 23.1 Rental, ſments to GSA..................................... 97,469 107,329 110,449 23.2 Rental payments to Non-GSA............................... 15,616,044 20,001,339 20,094,888 23.3 Communications, utilities, and miscellaneous charges... 7,658,852 8,157,473 8,216,719 24 Printing and reproduction 1,399,156 1,538,827 1,550,234 25 Other contractual services -------------------- . . . . . . . . 39,131,619 54,685,482 52,954,700 25.1 Advisory and assistance services............................ 3,164,920 3,546,001 3,568,798 25.2 Other services.................................................. 4,436,535 5,422,207 5,429,841 25.3 Other purchases of goods and services from government accounts........................................ 1,782,258 1,817,220 1,824,976 25.4 Operation and maintenance of facilities.................... 848,451 867,969 884, 193 25.5 Research and development contracts........ - - - - - - - - - - - - - - - 67,921,046 73,546,802 73,892,456 25.6 ADP Services and Supplies.................................. () {} () 25.7 Operation and maintenance of equipment.................. 2,050,862 2,133,16i 2,229,778 26 Supplies and materials - 6,375,654 6,494,525 6,526,431 31 Equip A- 7,946,369 8,270,389 16,283,861 33 Investments and Loans....................................... 50 50 O 41 Grants, subsidies, and contributions........................ 0. 0 0 42 Insurance claims & indemnities 350,363 350,363 350,363 43 Interest and dividends 46,211 () 0 Total other objects 172,760,402 201,481,294 208,542,494 Total direct obligations................................................. $684,710,476 $715,480,000 $730,060,000 Position Data: Average Salary, ES positions $188,548 $192,319 $196,358 Average Salary, GS positions $81,780 $83,416 $85,167 Average Grade, GS positions 9.8 9.9 9.9 336 26-12 RURAL DEVELOPMENT Salaries and Expenses SUMMARY OF RECOVERY ACT FUNDING item of Change - 2009 2010 2011 Personnel Compensation........................................... $1,685,885 $24,564,115 N/A Travel, Communication, Materials, Contractual Services.... 33,563,562 70,986,438 N/A Total Available ....................................................... $35,249,447 $95,550,553 N/A Program Implementation Activities: 2009. 2010 Total Funding Assumptions Personnel Compensation: Temporary personnel compensation $1,564,236 $19,435,764 $21,000,000 Hire 130 temporary Personnel benefits 121,649 5,128,351 5,250,000 employees. Travel arid transportation of persons 330,351 9,419,649 9,750,000 Travel for permanent and temporary staff Rent, communications, and utilities 7,082 2,792,918 2,800,000 Phone lines, computer - lines, and utilities. Communication services 0 1,695,000 1,695,000 Cell phones, blackberries Building rentals {} 2,750,000 2,750,000 Temporary office space - throughout the U.S. and - Territories Postage and related fees {} 2,250,000 2,250,000 Mailings, FedEx across - - the U.S. and Territories Printing and reproduction 27,784 4,222,216 4,250,000 Materials. Other contractual services 32,798,402 1,606,598 34,405,000 Appraisals, underwriting, legal, professional services, servicing, engineering and - - feasibility studies, and monitoring. Other services - IT 0 43,200,000 43,200,000 Replacement and enhancement - - of IT systems to support the programs. Supplies and materials 35,151 2,414,849 2,500,000 Supplies for additional staff and - increase in program activity. Bquipment 314,792 635,208 950,000 Laptops, computers, printers, Total Saiaries and Expenses $35,249,447 $93,550,553 $130,800,000 SCarºſłęIS. The American Recovery and Reinvestment Act of 2009 (ARRA), signed by the President on February 17, 2009, provided Rural Development with approximately $2.1 billion in program funds. It also authorized Rural Development to utilize up to 3 percent of the Budget Authority provided for those programs to cover administrative expenses related to the delivery of the ARRA programs. Of the funds available, $4,500,000 of the administrative funds will be used for Rural Business Service's guaranteed loans and grants, pursuant to sections 310(E)(a)(2)(A) and 310BC of the Consolidated Farm and Rural Development Act. Rural Housing Service's (RHS) administrative funds is $9,900,000 for the rural housing insurance fund section 502 direct loans and section 502 unsubsidized guaranteed loans. In addition, RHS funds will be used to cover costs to modify direct and guaranteed loans and to process direct loans for rural Community Facilities programs. $116,400,000 in administrative funds is for the Water and Waste Disposal Program for direct loans and grants, and Broadband loans and loan guarantees. Administrative expenses include ARRA-related contracting for services, travel, purchase of computer or communications equipment, and hiring temporary employees. Rural Development hired up to 130 temporary workers to support ARRA funded loans and grant activity at headquarters and in the field. The additional staff is needed to process loan applications, support quality control procedures, provide technical advice, and support other critical but temporary mission area needs related to ARRA, including required reporting standards. Rural Development plans to pursue hiring retired federal annuitants (on a temporary basis) who already are familiar with Rural Development's programs and can contribute immediately to ARRA activities. The majority (75%) of the temporary employees will be deployed in the field. It is anticipated that 30% of temporary staff will be used to support Broadband, 25% Water and Waste, 20% for Business Programs, 12.5% will be used to support Community Facilities, and 12.5% for Single Family Housing. 337 26-13 The bulk of the ARRAIT funding will be used to modernize Rural Development's antiquated direct loans, loan guarantees, and grant processing systems. To responsibly deliver the levels of funding provided for in Rural Development's ARRA appropriation, these IT systems must be modernized to enable the agency to account for the outlays in a fiscally responsible manner, prevent improper payments, manage the volume of anticipated loan servicing actions, and provide timely reporting to oversight agencies and stakeholders on an ongoing basis for many years. The existing IT systems, and the staff and resources that support them, would be severely challenged to provide the level of service and tracking required by the volume and dollar level of ARRA activity. Performance data are included on the program exhibits. 338 2011 Explanatory Notes Rural Housing Service Table of Contents Page Purpose Statement............................. 4 g º # * * * * * * * * * * g º e is º g º e & gº w & tº £ 4, & 4 tº º $ tº gº a tº * * * g y º gº gº is is tº $ tº gº tº º ºs e a .......... 27-1 Rural Community Facilities Program Account: Appropriations Language................................................................................., 27-4 Project Statement....... $ 4 & © & q & # * * * * * * * * * * * * g tº w ś º & 4 º' & * * * * * * * * * * * * * is e a # * * * * * * * * † tº 3 tº $ g º ſº * * * * * * * * to tº tº 4 º' tº ........, 27-6 Justifications........................................................ * tº ſº º s & ſº & * * * * * * * * * * * * * * * * * * * * * * e º & e s is º .... 27-9 Geographic Breakdown of Obligations......... * * * * * * * * * * * * ‘............................................ 27-1 || Classification by Objects........................................... * * * * * * * * * * * * * * * * # * * * * * * g is & 4 & 6 & rº 4 º' wa e º sº sº tº e. 27-22 Rural Housing Insurance Fund Program Account: - Appropriations Language....... $ & # * * * * * * * * * tº e g ºf wº .............. tº 4 & # wº, $ iº & * * * * * * * * * * * * * * * * * * * * * .............., 27-23 Project Statement.................. * * * * * > * * * * * * * * * * * * * * * * * * * * * * * * * g e o sº a tº $ tº $ at tº s x * * * * * * * * * * * * * * * * * * * * * * * ....... 27–26 Justifications.............................. * * * * * * * * * * * * * * • . . . . . . . . . . ê & © ºn tº * * * * * * * * * * * * * * * tº s $ $ tº e ºr p * * * * * * * * * * * * ... 27-31 Geographic Breakdown of Obligations............ * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * ........ 27–34 Classification by Objects......... * * * * * * * * * * * * * * g º & a 3 E tº g g º º • * * * * * * * * * * * * * * * * * * * * * * * * * * * * * s. tº a $ tº $ tº 4 ºr tº * * * * * * * * * 27-47 Farm Labor Program Account: A. Appropriations Language................ * * * * * * * * * * * * * *- * * * * * * * tº $ it tº a + y º ºs º- + æ. 4 * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * 27-48 Project Statement....................... * * * * * * * * * * * * * * * * * * * * * * * * * * * fe à & 4 tº $ tº tº tº * * * * * * * * * * * * * * * * * * * * * * * * * * * * ..... 27–50 Justifications................ 4 is is º ºs º º tº e a gº e * * * * * * tº wº & Q & 2 gº. # * * * * * * * * * * * * * * * * * * * * g g º ºr 6 y º ºr u * * * * * * * * * * * * * * * ........... 27-51 Geographic Breakdown of Obligations................................ tº & gº º e º # 4 tº gº s & a g º & © tº tº tº $º * * * * * * * * * * * * * 27-52 Classification by Objects.................... * * * * * * * * * * * * * > * * * * * * * * * & © & 4 gº º q ºr $ e º $ 4 º' tº * * * * * * * * * * * * * * ........... 27-53 Multifamily Housing Revitalization Program. Account: Appropriations Language............... * * * * * * * * * * * * * * * * * * * * * * * * * * * e 4- tº a s & a ſº us -º º sº tº a .e. e. g. sº y º ºr tº e s is a e s e e º a * * * * * * * * 27-54 Project Statement................................... .* * * * * * * * * * * * * * * * * * * * * * * * * * * * v w w = w e º e v e s a s ................ 27-57 Justifications.................................... * * * * * * * * * tº & 4 x * * * * * is us tº e º 'º a tº * * * * * * * * * * * * * * * * * * * * * * * * * * * ........ 27-59 Geographic Breakdown of Obligations.......................... e & º dº $ sº * * * * * * * * * • - ". . . . . . . . . . . . . . . . ....... 27-60 Classification by Objects.............................. tº * * * * * * * * g ºn 4 & e º 'º a tº sº e s e º te & sº * * * * * * * is e º e s p ∈ is e g = g º ºr ...... 27-66 Rental Assistance Program: Appropriations Language........................... * * * * * * * * * * * * * * * * * * * * * * * * tº 4 tº g º 'º e º 'º & tº £ tº a s e º & sº tº e º 'º ºf p * * * * * * 27-67 Project Statement................ * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * ............... 27-69 Justifications................................................................... .............................. 27-70 Geographic Breakdown of Obligations.................................................................. 27-71 Classification by Objects........................... $ tº q + ºr tº gº ºs y º s º 'º e tº is ſº e º e º is & * * * * * * * * * * * * * *g * * * * * * * * * ........, 27-72 Rural Housing Assistance Grants: - Appropriations Language............................................... & is a 4 + 2* * * * * * * * * * * * .................. 27-73 Project Statement......................................................... tº ºr * * * * * * * * * * * * * * * * * * $ & sº tº ſº a tº e º ſº. ...., 27-75 Justifications............. * * * * * * * * * * * * * * * * * * * * * * * * * * s à # * * * * * * * * * * * * * * * * * * ..................................... 27-78 Geographic Breakdown of Obligations........ * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * ................. 27-81 Classification by Objects............. * * * * * * * * * * * tº e º 'º dº e º 'º º * * * * * e º & ºr tº a º ºs º ºs s a tº º * * * * * * * * * * * * * * * * * .............. 27-85 339 Mutual and Self-Help Housing Grants: Appropriations Language.................................................................................. 27-86 Project Statement................ * * * * * * • * * - - - - - - - - - - - - - - - - - - - - - - - - - - - - - * = * * * * * * * * e & & s is tº e s & A, a e s a s h m e a s a tº a s & ... 27–88 Justifications...... sº º is $ $ tº e º 'º e * * * * * * * * * * * * * * * * * * * ê & 8 & © & a # * * * * * * * * * is nº ºf * * * * * * * * v & ſº tº $ tº 4 sº º it is e a e º a tº s tº us tº * * * * * * * * * * * * * 27-89 Geographic Breakdown of Obligations.............. * * * * * * * * * * * * * & a w is a s g º ºs e a e < * * * * * * * * * * * * * * * * * * * * * * * * * . 27–90 Classification by Objects............................................. & sº * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * 27–91 Summary of Recovery Act Funding........... tº w w is a tº as a tº s ºr s º Aº ‘u º & 9 m a & 2 g º s tº a m .................................... 27-92 ‘Status of Programs..... * * * * > * * tº* * * * * * * * * * * g º sº wº. e º $ tº tº & * * * * * * * * * * * * * * * * * * ............................…. 27-gl Summary of Budget and Performance.......................... * * * * * * is tº e º ºs & tº gº º is tº # = * * e º e º 'º at a tº a A • * * * * * * * * * * * * * * 27-94 Key Performance Outcomes and Measures...... tº gº tº g º is tº tº tº a tº tº 4 º' tº # * * 4 & 4 tº e g g g º ºs & e º dº w w is s h tº º tº t e is a s is nº e a e tº a tº tº a e s tº e . 27-105 Full Cost by Strategic Goal....... * * * * * * * * * * * * * * * * * * * * * tº $ tº $ tº ſº º tº $ t tº ſº & tº $ $ ºr a tº e ºr e º € $ $ 4 º' tº $ * * * * * * * * * * * * * * * * * * * * * * * * * * 27-108 340 27–1 RURAL DEVELOPMENT HOUSING PROGRAMS Purpose Statement Rural Development Housing Programs provide affordable housing to rural communities. The agency goal is to improve the quality of life in Rural America by: 1) providing decent, safe, and affordable housing; and 2) develop community infrastructure. Rural Development delivers housing programs authorized by the Housing Act of 1949, as amended, and community facilities programs authorized by the Consolidated Farm and Rural Development Act, as amended. Section 502 Direct Single Family Housing Loan Program. Provides loans to low- and very-low-income families to purchase, build or rehabilitate a home in rural areas. Financing is 100 percent with payments subsidized to between 22 percent and 26 percent of the applicant’s income. Section 504 Housing Repair and Rehabilitation Loans. Available to very-low-income applicants who own and occupy dwellings in rural areas. Loans of up to $20,000 may be made to remove health and safety hazards or for repairs or improvements to the home. Loans feature a one percent Interestrate and up to a 20-year term, Section 504 Housing Repair Grants. Available to very low-income elderly families who own and occupy a rural home and cannot afford a Section 504 loan. Grants of up to $7,500 are available to improve accessibility or to remove health and safety hazards. Grants must be repaid to the government if the property is sold within three years, Section 524 Housing Site Development Loans. Available to public and private non-profit organizations, local governments and tribal organizations to buy and develop building sites, including construction of access roads, streets, and utilities in rural areas. Organizations receiving site loans must make the sites available to low- to moderate-income families using Section 502 or similar affordable mortgage financing programs that serve lower-income families. Section 523 Self-Help Land Development Housing Loans. Available to public and private non-profit organizations, local governments and tribal organizations to buy and develop building sites, Including construction of access roads, streets, and utilities in rural areas. Organizations receiving Section 524 site loans must offer the sites to families who will be building their own homes by the self-help method. Section 523 Mutual Self-Help Grants. Available to public and private non-profit organizations, local governments and tribal organizations to provide technical assistance to low- and very-low-income families to build their homes through the mutual self-help method. Grant terms are for 2 years and funds may be used to pay salaries, office rent and related expenses associated with operating the organization. Section 525 Technical and Supervisory Assistance Grants. Available to non-profits, local governments, and tribal organizations for rural technical assistance programs (i.e. homeownership education and financial counseling). The technical assistance provided through these entities ultimately promotes successful homeownership and helps reduce home loan delinquency Section 509 Compensation for Construction Defects. Available to Section 502 directhomeowners to repair structural defects in homes constructed by the contractor method. Grants are available only if the contractor refuses or is unable to honor the warranty and only covers defects within 18 months of completion of the home. Funds may also be used for related costs, such as temporary living expenses, 341 27-2 Single Family Housing Credit Sale (Non-Program). Available to individuals to purchase inventory property at non-program rates and terms. Loan terms range from ten years for investors to a maximum of 30 years if the buyer occupies the property. Down payment of two percent to five percent of purchase price is required. w Section 502 Guaranteed Single Family Housing. Families may be eligible to become rural homeowners with the help of a USDA guaranteed home loan. When the Federal government agrees to guarantee a loan, lending institutions can help buyers while incurring less risk. Through USDA's guaranteed rural housing loan program, low- and moderate-income people can qualify for mortgages even without a down payment. Loans through this program may be for up to 100 percent of appraised value or for the acquisition cost, whichever is less, and the guarantee fee may be added to increase the loan amount. No down paymentis required. Mortgages are 30-year fixed rate at market interestrates, Homebuyers apply with participating lenders. Guaranteed loans may also be made to refinance either existing guaranteed housing loans or Section 502 direct housing loans. For purchase loans, a one-time guarantee fee of two percent of the loan amount is charged to the lender, but may be passed on to the buyer. The guarantee fee for refinance transactions is 1.0 percent. In addition, there is an annual fee of 0.15 percent that is charged until 22 percent of the original principal loan amount is paid off. Community Facilities Direct and Guaranteed Loans and Grants. Provides financing to units of local government, nonprofit corporations, or Federally-recognized Indian tribes for the development of essential community facilities in rural areas. Eligible purposes include health care facilities; fire, rescue, and public safety buildings, vehicles, and equipment; educational and cultural facilities; town halls, community - centers, and libraries; and adult and child day care facilities. There are no minimum or maximum loan amounts and the loan term is the useful life of the facility or the limit established by State law. Section 515 Rural Rental Housing Program. Provides funds for the construction and rehabilitation of affordable rental housing for rural families and elderly residents who have very-low, low and moderate incomes. Section 514/516 Farm Labor Housing Loan and Grant Program. Provides decent, safe, and sanitary housing for farm workers by providing loans to farmers for small, on-farm housing or loans and grants for off-farm multi-family developments. Section 521 Rental Assistance Program. Provides assistance to eligible tenants in Section 515 and Section 514/516 assisted housing so that they pay no more than 30 percent of their incomes for rent and utilities, Section 533 Housing Preservation Grant Program. Provides funds to repair and rehabilitate housing owned or occupied by rural families with low incomes through grants to non-profit organizations and public bodies. Section 538 Guaranteed Loan Program. Provides loan guarantees on loans made by public and private approved lenders to build or preserve affordable housing. Loans made for the construction, acquisition, or rehabilitation of rural multi-family housing can be guaranteed up to 90 percent of principal and interest. Loans guaranteed by this program are generally sold in the secondary market. These Sales in the Secondary market enable greater capital to flow through these rural communities then without these guarantees. Currently, there is no fee charge for these guarantees, and the interest is not subsidized. Section 542 Rural Housing Voucher Program. The Rural Housing Voucher Program, authorized under Section 542 of the Housing Act of 1949, is designed to provide tenant protections in properties that prepay their mortgages after September 30, 2005. These Vouchers are portable and will enable tenants to continue to access affordable housing without benefit of the traditional Rental Assistance Program. 342 27–3 Geographic Dispersion of Offices and Employees Rural Development programs are administered by the three programs representing Rural Development: Housing and Community Facilities, Utilities, Business and Cooperative Development. Rural Development headquarters is located in Washington, D.C. As of September 30, 2009, there were 6,069 permanent full- time employees in the headquarters office and state and field offices. OIG/GAO Reports There are no reports for these programs. 343 27-4 RURAL HOUSING SERVICE The estimates include appropriation language for this item as follows (new language underscored; deleted matter enclosed in brackets): Rural Community Facilities Program. Account (including transfer of balances) For the cost of direct loans, and loan guarantees, and grants for rural community facilities programs as authorized by section 306 and described in section 381E(d)(1) of the Consolidated Farm and Rural Development Act, [$54,993,000 $41,717,000, to remain available until expended: Provided, [That $6,256,000 of the amount appropriated under this heading shall be available for a Rural Community Development Initiative: Provided further, That such funds shall be used solely to develop the capacity and ability of private, nonprofit community-based housing and community development organizations, low-Income rural communities, and Federally Recognized Native American Tribes to undertake projects to improve housing, community facilities, community and economic development projects in rural areas: Provided further, That such funds shall be made available to qualified private, nonprofit and public Intermediary organizations proposing to carry out a program of financial and technical assistance: Provided further, That such intermediary organizations shall provide matching funds from other sources, including Federal funds for related activities, in an amount not less than funds provided: Provided further, That $13,902,000 of the 7 amount appropriated under this heading shall be to provide grants for facilities in rural communities with extreme unemployment and severe economic depression (Public Law 106-387), with up to 5 percent for administration and capacity building in the State rural development offices: Provided further, That $3,972,000 of the amount appropriated under this heading shall be available for community facilities grants to tribal colleges, as authorized by section 306(a)(19) of such Act: Provided further, That of the amount appropriated under this heading, the amount equal to the amount of Rural Community Facilities Program. Account funds allocated by the Secretary for Rural Economic Area Partnership Zones for the fiscal year [2009|2010, shall be available through June 30, [2010;2011, for communities designated by the Secretary of Agriculture as Rural Economic Area Partnership Zones for the rural community programs described in section 381E(d)(1) of the Consolidated Farm and Rural Development Act: Provided further, That section 381E-H and 381N of the Consolidated Farm and Rural Development Act are not applicable to the funds made available under this heading: Provided further, That any prior balances in the Rural Development, Rural Community Advancement Program account for programs authorized by section 306 and described in section 381E(d)(1) of such Act be transferred and merged with this account and any other prior balances from the Rural Development, Rural Community Advancement Program account that the Secretary determines is appropriate to transfer. The first change removes the language for earmarks of grants which can be funded under the regular rural community facility grant program. - - The second change reflects the change of the fiscal year the designation of set-aside for Rural Economic Area Partnership Zones funds is formulated by The third change modifies the expiration date of set-aside funds for rural economic area partnership zones from June 30, 2010, to June 30, 2011. 344 27–5 RURAL HOUSING SERVICE Analysis of Change in Appropriation RURAL COMMUNITY FACILITY PROGRAM ACCOUNT (On basis of loan level, subsidy, and grants) Loan Level Subsidy Grants Appropriations Act, 2010............................ $501,379,277 $10,490,000 $44,503,000 Budget Estimate, 2011............................... 501,467,974 12,077,000 29,640,000 Increase or decrease in Appropriations............ 88,697 1,587,000 -14,863,000 É PROJECTSTATEMENT (On basis of supportable loan levels and appropriated subsidies and giants) (In thousands of dollars) 2009 Actual 2010 Estimated * Inclease of Declease 2011 Estimated ſtem of Change. Program Level | Subsidy/BA iProgram Level Subsidy/BA. Program Level. Subsidy/BA Plogiam Level Subsidy/BA Rural Community Facility Programs: Dilect loans '. - $217,824 $12,460 $294,962 $3,864 $76 (1) $60 (3) $295,038 $3,924 Direct loans - ARRA eſ 204,369 11,690 {}} . 0 () 0 0 {} Direct loans - 2005 hullicane em suppl aſ () 0 0 0 {} 0 0 () Dilect loans - 2007 disaste, Supplemental b / 2,430 139 0 () 0 () O 0 Direct loans - 2008 disaste, supplemental g/ 75,563 432 Ö O 0 0 0 O Gualanteed loans 178,722 5,505 206,417 6,626 -12 (2) 1,527 (4) 206,405 8,153 Gualanteed loans - 2005 hurli em Supp aſ 0 0 O 0 0 0 0 0 Gualanteed loans - 2008 disaster supp c./ 101,156 3,116 0 O 0 0 0 0 Giants • 19,196 19,196 20,373 20,373 9,267 9,267 (5) 29,640 29,640 Glants - ARRA ef. 31,118 31,118 0 0 0 0 0 0 Giants - 2003/2004 hurlicane em suppl d/ {} () O 0 0 () 0 0 Giants - 2005 hullicane em supplemental aſ 0 0 {} 0 0 () O 0. Giants - 2007 disastel supplemental b / 11,944 11,944 0 0 0 () 0 0 Giants-2008 disastel supplemental cf 12,712 12,712 0 0. 0 0 O 0 Ruial community dev initiative grants d 4,241 4,241 6,256 6.256 -6,256 -6,256 (6) 0 () Ruial coop home based health care demo {} 0 {} 0 () 0 0 0 Hazardous weathel early warning grants 0 0 0 0 0 0 0 () Economic impact initiative giants 10,834 10,834 13,902 13,902 -13,902 -13,902 (7) 0 0 Thibal college giants 4,685 4,685 3,972 3,972 -3,972 -3,972 (8) O 0 Total Available ol Estimate 374,794 128,070 545,882 54,993 -14,799 -13,276 531,083 41,717 Total adminstiative expenses - ARRA eſ 0 3,900 0 0 0 () 0 O Total adminstative expenses -2008 - Disastels c........... a v A * * * * * * * * * * * * * * * * * * * * * * * * * * * * * {} 1,200 0 () () 0 0| 0 Tiansſel of unobligated balances -334,352 -52,000 O 0 O 0 0 0 Recovery of pliol year obligations -106,003 -4,198 () 0 () 0 0 0 Unobligated balance available, start of year -118,069 -16,490 0 0 0. 0 0 0 Unobligated balance available, end of year 1,422,907 133,348 0 {} 0 Ö O 0 ARRA Applopiiation eſ -1,197,299 -130,000 Ö 0 0 0 0 O Total Applopriation 541,977 63,830 545,882. 54,993] -14,799 -13,276 531,083 41,717 acility Program. The justification of increases and decreases is based on the NOTE: Amounts 1eflected above are budge projections of use of funds within Rural Community F piojected use of funds Individual columns may not add due to lounding ; # PROJECT STATEMENT (On basis of obligations under available funds) § (In thousands of dollars) 2009 Actuals 2010 Estimated Increase or Decrease 2011 Estimated Item of Change Program Level | Subsidy/BA |Program Level. Subsidy/BA |Program Level. Subsidy/BA |Program Level Subsidy/BA Rural Community Facility Programs: Direct loans.... - $217,824 $12,460 $881,622 $11,549 -$586,584 -$7,625 $295,038 $3,924 Direct loans - ARRA eſ 204,369 11,690 931,761 12,206 -931,761 -12,206 0 0 Direct loans - 2005 hurricane em. suppl. a.ſ..... 0 0 166,920 2,187 -166,920 –2,187 {} 0 Direct loans - 2007 disaster supplemental b /... 2,430 139 32,180 422 -32,180 -422 () 0 Direct loans - 2008 disaster supplemental c ſ.... 75,563 432 437,724 5,734 –437,724 -5,734 {) 0 Guaranteed loans - - 178,722} 5,505 265,482 8,522 -59,077 -369 206,405 8,153. Guaranteed loans - 2005 hurri. em supp aſ...... 0} . 0 34,393 1,104 –34,393 -1,104 {} 0 Guaranteed loans - 2008 disaster supp c ſ......... 101,156 3,116 54,031 1,734 –54,031 -1,734 {} 0 Grants. 19,196 19,196 23,276 23,276 6,364 6,364 - 29,640 29,640 Grants - ARRA eſ 31,118 31,118 71,086 71,086 –71,086 –71,086 0 0. Grants - 2003/2004 hurricane em. suppl. d.ſ..... 0 () 536 536 -536 -536 () 0 Grants - 2005 hurricane em. supplemental aſ... 0 0 543 543 -543 -543 O () Grants - 2007 disaster supplemental b /............ 11,944 11,944 3,739 3,739 -3,739 -3,739 0. {} Grants - 2008 disaster supplemental c /............. 12,712 12,712 11,538 11,538 -11,538 -11,538 0 0 Rural community dev. initiative grants.......... 4,241 4,241 12,924 12,924 -12,924 -12,924 0 0 Rural coop, home based health care demo...... () 0 327 327 –327 –327 0 0 Hazardous weather early warning grants.......... () 0. 231 231 , -231 -231 () 0 Economic impact initiative grants..................... 10,834 10,834 16,360 16,360 -16,360 -16,360 0 0 Tribal college grants 4,685 4,685 4,322 4,322 –4,322 –4,322 0 0 Total Available or Estimate 874,794 128,070 2,948,995 188,341 -2,417,911 -146,624 531,083 41,717 Total adminstrative expenses - ARRA eſ.......... 0 3,900 0 0 0 0 0 0 Total adminstrative expenses - 2008 Disasters c.......................................... () 1,200 0 () 0 {} () () Transfer of unobligated balances...................... -334,352 –52,000 0 () 0. 0 0 0 Recovery of prior year obligations.................... -106,003 -4,198 () {} () 0 () 0 Unobligated balance available, start of year.......... -118,069 -16,490 -2,412,350 -133,348 2,412,350 133,348 {} 0 Unobligated balance available, end of year........... 1,422,907 133,348 0 {} 0 0 0 {} ARRA Appropriation e'................................. -1,197,299 -130,000 0 0 {} 0. {} 0 Total Appropriation 541,977 63,830 536,645 54,993 -5,561 -13,276 531,083 41,717 NOTE: Amounts reflected above are budget projections of use offinds within Rural CommunityFacilityFrogram.The justification of increases and decreases is based on the projected use of funds. Individual columns may not add due to rounding. Project Statement Footnotes: d/ Provided by the Emergency Supplemental Appropriations Act for Defense, the Global War on Terror, and Hurricane Recovery, 2006, P.L. 109–234, signed June 15, 2006, for necessary expenses related to consequences of Hurricane Katrina and other hurricanes of the 2005 season. Provided by the U.S. Troop Readiness, Veterans' Care, Katrina Recovery, and Iraq Accountability Appropriations Act, 2007, P.L. 110-28, signed May 25, 2007, for areas in Kansas hit by the tornadoes on May 6, 2007, and unobligated balances in the amount of $12 million from the funds provided in P.L. 110-28 were transferred to Community Facilities grants in FY 2009. Transfers from the Rural Development Disaster Assistance Fund provided by the Consolidated Security, Disaster Assistance, and Continuing Appropriations Act, 2009, P.L. 110-329 in the amount of $40 million. Provided by the Emergency Supplemental Appropriations for Hurricanes Disasters Assistance Act of 2005, P.L. 108-324, signed October 13, 2004, for the purpose of serving communities affected by hurricanes and tropical storms in calendar year 2003 or 2004. Provided by the American Recovery and Reinvestment Act of 2009, P.L. 111–5, signed February 17, 2009, for the purpose of making supplemental appropriations for job preservation and creation, infrastructure investment, energy efficiency and science, assistance to the unemployed, and State and local fiscal stabilization. The funds are available through the fiscal year ending September 30, 2010, 348 (1) (2) (3) (4) (5) 27-9 JUSTIFICATION OF INCREASES AND DECREASES An increase of $75,762 for the direct community facilities loans ($294,961,832 available in 2010). The community facility direct loan program assists rural municipalities and non-profit organizations in financing the most essential community facilities to improve the quality of life for their residents. These facilities help achieve the Department’s Strategic Goal of assisting Rural Communities to create prosperity so they are self-sustaining, repopulating, and economically thriving. As State budgets continue to struggle, municipalities increasingly turn to the Federal government for assistance with long-term financing. Direct loans are primarily targeted to health care; fire/rescueland public safety facilities and equipment; and educational facilities, but also can be used to further food security objectives. This program has been used to finance farmers markets as well as community food banks serving unemployed and underemployed residents. The program will be used to fund Healthy Food, Healthy Neighborhoods, and the Regional Innovation Initiatives. A decrease of $12,382 for the guaranteed community facilities loans ($206,417,445 available in 2010). The guaranteed loan program serves the same organizations and purposes as the direct loan fund, the difference being that the guaranteed loans are actually made and serviced by a bank or other commercial lender and guaranteed by the Federal government. As a result, the interestrate is generally a competitive commercial rate. The decrease is due to a technical adjustment. An increase of $60,000 for the direct community facilities loan subsidy ($3,864,000 available in 2010). The change in the subsidy rate is due to the increase in the estimated Treasury discount rate for these programs. An increase of $1,527,000 for the guaranteed community facilities loan subsidy ($6,626,000 available in 2010). - The change in the subsidy rate is primarily due to changes in technical assumptions such as defaults and recoveries and the increase in the estimated Treasury discount rate for these programs. An increase of $9,267,000 in the community facility grants ($20,373,000 available in 2010). To better address the Department’s Strategic Goal of assisting Rural Communities to create prosperity so they are self-sustaining, repopulating, and economically thriving, the Community Facilities (CF) Grants program provides funding for essential community facilities in rural communities with populations of up to 20,000. Priority for grant funding is given to applicants in rural communities with populations of 5,000 or less, and applicants in communities with low median household incomes receive a higher percentage of grant funds. The increase of funds will be used to support the Healthy Food, Healthy Neighborhoods and Regional Innovation Initiatives. The Healthy Food, Healthy Neighborhoods initiative will support local and regional efforts to increase access to health food, in particular for developing grocery stores and other health food retailers in urban and rural food deserts and other low-income/underserved areas in coordination with other Agencies. In addition, the new Regional Innovation Initiative focuses planning and coordination of USDA and other sources of assistance for rural communities, allowing for communities with the same region working together instead of independently produce more prosperity for all communities involved. The CF grant program is over-subscribed annually. The funds requested for FY 2011 will allow Rural Development to continue to meet the most pressing needs in our most rural and economically stressed communities. - 349 (6) (7) (8) 27–10 A decrease of $6.256,000 in the rural community development initiative ($6.256,000 available in 2010). - The rural community development initiative provides grants to organizations to provide training to local governments or other organizations in the areas of housing, community development, and economic development. This program is duplicative; other programs are available which provide similar services and may be more effective. Therefore, the program is zeroed out for FY 2011. A decrease of $13,902,000 in the economic impact initiative grants ($13,902,000 available in 2010), The Economic Impact Initiative grants provide assistance to rural communities with extreme unemployment and severe economic depression. In addition, a facility to be financed under this program must have a “not employed rate” greater than 19.5 percent. This program is duplicative; other programs are available which provide similar services and may be more effective. In addition, the regular Community Facilities program can be used to fund these projects. Therefore, the program is zeroed out for FY 2011. A decrease of $3,972,000 in the tribal college grants ($3,972,000 available in 2010). The Tribal College grants program provides assistance to the 32 tribal Colleges that are 1994 land-grant institutions meeting the criteria of the Equity in Education Land-Grant Status Act of 1994. This program is duplicative; other programs are available which provide similar services and may be more effective. In addition, the regular Community Facilities program can be used to fund these projects. Therefore, the program is zeroed out for FY 2011. - 350 27-1 1 RÚRAL, HOUSING SERVICE GEOGRAPHIC BREAKBOWN OF OBLIGATIONS 2009 Actual and Estimated 2010 and 2011 Rural Community Facility Loan Program - Direct - Recovery Act 2009 2010 2011. Alabama $734,300 ** * * Alaska 100,000 sº ** Arkansas 425,000 ** *A*- California 3,210,200 *sº * * Colorado 380,000 was sº ** Connecticut 4,000,000 ** * * F}orida 722,500 •º gº & wº Georgia 1,280,722 *sº *** Idaho 1,314,000 ** ** Hilinois 6,130,000 ** * * Indiana 17,390,000 ** *** Iowa 600,000 gº ºs- **** Kentucky 30,000 ** * * Louisiana 3,771,000 tº gº *** Maine 5,062,000 ** ** Massachusetts 1,707,000 pºsts? **** Michigan 10,299,000 * * *d ºr Minnesota 1,950,000 arrams ** Mississippi 4,031,532 •ºstº. : Missouri 1,626,679 * * *A Montana 5,324,000 •ºsº *:: Nebraska 17,877,300 mºtº seve New Mexico 35,509,600 ** - * New York 11,920,990 **t ***. North Carolina 11,974,910 sº sº wº- North Dakota 622,410 *** * * Ohio 10,200,775 sº-sº *A*- Oklahoma 563,863 sº wº ** ** Oregon 85,000 eas wºn **** Pennsylvania 1,881,000 wºº. www.a. South Carolina 2,906,200 *sº * * South Dakota 1,143,250 *** * * Tennessee 10,173,000 * * **- Texas 256,700 ** **t Utah 2,100,000 *** .*** Vermont 2,735,000 tºº. *** Virginia 4,745,800 ** ** Washington 3,008,200 *w- *.* West Virginia 5,394,000 ** www.sº Wisconsin 10,683,450 *** *- Total Avail./Est, $204,369,381 $931,761,176 1/ * * 1/ Cannot be distributed by geographic area in advance. 351 f/ 27-12 RURAL HOUSING SERVICE GEOGRAPHICBREAKDOWN OF OBLIGATIONS 2009 Actual and Estimated 2010 and 2011 Rural Community Facility Loans 2005 Hurricanes Đlsasters 2009 2010 2011 Total Avail/Est. **** _$166,919,592.1/ ** * Rural Community Facility Loans 2007 Tornados Disasters 2009 2010 2011 Kansas $2,430,200 **** ** Total Awaii./Est, $2,430,200 $32,179.585.1/ ** Rural Community Facility Loan Program 2008 Disasters 2009 2010 2011. Arkansas $8,347,000 *º. assº Hawaii 22,470,000 **** * * Iowa 20,784,000 -- ** Kansas 183,600 ** * * Kentucky 8,000,000 **** *** Maine 2,500,000 wº ©º Massachusetts 1,335,000 **** **t Minnesota 115,000 ***** **** Missouri 4,097,140 * * **** Nebraska 700,000 ** *...* Ohio 400,000 *Áº. •º & Oklahoma 3,843,705 ** * * Tennessee 268,000 | -- *ºr sº Texas 1,727,200 4s tº *** Washington 792,500 *ºtºr tgºsº Total Awaii./Est, $75,563,145 $437,724,282 l/ *ºtº Cannot be distributed by geographic area in advance. 352 Alabama Alaska Arizona Arkansas California Colorado Connecticut Delaware Florida Georgia Hawaii Idaho Illinois Indiana ſowa Kansas Kentucky £oulsiana Maine Maryland Massachusetts Michigan Minnesota Mississippi Missouri Montana Nebraska Nevada New Hampshire New Jersey New Mexico New York North Carolina North Dakota Ohio Oklahoma Cregon Pennsylvania Rhode Island South Carolina South Dakota Tennessee Texas ŁJiah Vermont Virginia Washington West Virginia Wisconsin Wyoming Puerto Rico Virgin Islands W. Pacific Areas Undistributed Total Avail./Est. 27-13 RURALHOUSING SERVICE GEOGRAPHICBREAKDOWN OF OBLIGATIONS 2009 Actual and Estimated 2010 and 2011 2009. 2010 2014. as sº $4,220,000 $3,287,000 $200,000 1,429,000 t,340,000 as wº 2,637,000 2,069,000 -- 3,119,000 2,440,000 1,168,500 4,458,000' 3,470,000 807,337 2,221,000 ł,749,000 * 1,546,000 1,230,000 * 1,275,000 1,022,000 º 4,356,000 3,392,000 ** 5,351,000 4,157,000 2,664,000 1,321,000 1,057,000 775,000 1,782,000 ł,412,000 1,091,000 3,684,000 2,875,000 ** 3,770,000 2,941,000 3,948,092 2,645,000 2,076,000 17,550,000 2,087,000 1,646,000 *ěº 4,339,000 3,379,000 -- 3,025,000 2,369,000 2,700,000 2,155,000 1,699,000 tº sº 1,911,000 1,511,000 4,770,000 1,519,000 1,209,000 e- 5,243,000 4,074,000 *ses 3.249,000 2,540,000 º 3,893,000 3,036,000 2,143,720 3,817,000 2,977,000 12,400,000 1,749,000 1,386,000 t1,500,000 1,770,000 1,403,000 * * 1,625,000 1,291,000 884,800 1,656,000 1,345,000 490,000 1,511,000 1,203,000 ** i,822,000 1,443,000 sº 4,229,000 3,294,000 17,231,481 5,821,000 4,519,000 20,415,725 1,383,000 1,102,000 7,000,000 5,450,000 4,003,000 2,500,000 2,891,000 2,265,000 12,389,000 2,349,000 1,848,000 17,530,389 4,882,000 3,796,000 ** 1,081,000 873,000 *** 3,928,000 3,063,000 825,000 1,563,000 1,243,000 150,000 4,729,000 3,679,000 10,802,500 5,824,000 4,519,000 8,760,000 1,486,000 1,184,000 340,000 1,590,000 1,265,000 * 3,793,000 2,959,000 10,639,000 2,686,000 2,107,000 250,000 2,377,000 1,869,000 6,096,400 3,470,000 2,710,000 * * 1,280,000 1,026,000 see 1,725,000 1,368,000 &º 1,000,000 310,000 1,000,000 1,000,000 810,000 Li6,963,492 89,295,000 3118,721,944 $263,482,492 $206,495,000 Rural Community Facility Loan Program - Guaranteed 353 27-14 RURAL, HOUSING SERVICE GEOGRAPHICBREAKDOWN OF OBLIGATIONS 2009 Actual and Estimated 2010 and 2011 Rural Community Facility Loan Program - Guaranteed 2005 Hurricanes for Natural Disaster 2009 2010 *sensassº. Total Avail./Est. ** $34,392,523 iſ Rural Community Facility Loan Program - Guaranteed 2008 Disasters 2009 2010 Hawaii $7,100,000 ** Iowa 40,935,695 * * Kansas 3,000,000 ** Kentucky 14,206,000 * Gº Maine 300,000 * **º Missouri - 15,000,000 mºm wº Nebraska 15,700,000 ºr tº: New Hampshire 400,000 * & Oklahoma 2,244,290 &s wº South Dakota 150,000 tº tº Vermont 2,120,000 sº Total Awaii./Est. $101,155,985 $54,031,017 1/ Cannot be distributed by geographic area in advance. 354 27-15 RURAL HOUSING SERVICE GEOGRAPHICBREAKDOWN OF OBLIGATIONS 2009 Actual and Estimated 2010 and 20 il Rural Community Facility Grants - 2009 2010 2011 Alabama $829,237 $556,000 $685,000 Alaska 110,440 112,000 198,000 Arizona 61,022 320,000 427,000 Arkansas 410,860 372,000 484,000 Galifornia 527,330 572,000 - 704,000 £olorado 295,249 223,000 320,000 Connecticut 117,090 123,000 210,000 Delaware 162,817 97,000 182,000 Florida . 198,750 - 564,000 694,000 Georgia 725,460 663,000 804,000 Hawaii 227,092 88,000 172,000 Idaho 163,960 168,000 260,000 Illinois 444,950 351,000 461,000 Indiana 335,850 394,000 . 508,000 fowa 283,980 256,000 356,000 Kansas 14,000 198,000 - 293,000 Kentucky 663,706 545,000 674,000 Louisiana 353,810 365,000 477,000 Maine 263,700 219,000 316,000 Maryland - 190,796 188,000 282,000 Massachusetts 132,810 143,000 232,000 Michigan 1,223,670 566,000 697,000 Minnesota 432,000 323,000 430,000 Mississippi 770,862 468,000. 590,000 Missouri 473,925 441,000 560,000 Montana 74,940 156,000 246,000 Nebraska ió3,279 161,000 252,000 Nevada 104,873 145,000 234,000 New Hampshire 105,520 147,000 237,000 New Jersey 192,426 146,000 235,000 New Mexico 287,489 186,000 279,000 New York 407,960 492,000 513,000 !North Carolina 1,439,435 707,000 853,000 North Dakota 55,107 118,000 205,000 Ohio 621,350 548,000 678,000 Oklahoma 750,422 - 334,000 442,000 Oregon 77,690 205,000 300,000 Pennsylvania 921,200 557,000 688,000 Rhode Island 29,120 78,000 161,000 South Carolina 314,900 473,000 595,006 South Dákota 190,260 146,000 235,000 Tennessee 1,003,960 569,000 700,000 Texas 1,075,212 707,000 . 853,000 Utah 86,753 133,000 221,000 Vermont 262,190 134,000 222,000 Virginia 470,530 459,000 580,000 Washington 118,900 288,000 392,000 West Virginia 297,300 285,000 388,000 Wisconsin 423,800 361,000 472,000 Wyonung 152,900 97,000 182,000 Puerto Rico 295,270 201,000 296,000 Virgin Islands sº 75,000 157,000 W. Pacific Areas 159,512 75,000 #57,000 Undistributed sºvº 6,977,323 7,751,000 Total Avail./Est. $19,195,769 $23,276,323 $29,640,000 355 27–16 RURAL HOUSING SERVICE GEOGRAPHEC BREAKDOWN OF OBLIGATIONS 2009 Actual and Estimated 2010 and 2011 Rural Community Facility Grants - Recovery Act 2039. 2010 Alabama $9,180 ** Alaska 1,136,385 *** Arkansas 2,098,000 *** California 2,893,991 *gº. Colorado 244, 13 ** Connecticut 315,620 ** Delaware 70,000 *-*. Fiorida 250,000 *** Georgia 367,550 *** Idaho 190,000 ºº: Illinois 234,059 ** Indiana 285,610 --> ſowa 2,583,983 * * kansas 90,000 zºº ºr Kentucky 948,387 -arº Louisiana 362,746 Fºº Maine 296,500 º Maryland 495,789 **** Massachusetts 13,570 * *k. Michigan 1,148,000 *** Minnesota $37,200 ** Mississippi 2,552,545 *** Missouri 2,480,450 *** Montana 387,000 ** Nebraska 42,950 **** Nevada 122,393 ** New Hampshire 252,820 4Kºº New Mexico 555,500 * * New York 756,000 *º-sº North Carolina 1,703,688 ** North Dakota 186,920 ** Ohio 581,050 * tº Okiahoma 777,192 ** Oregon 50,000 *stwº Pennsylvania 301,000 *Frº South Carolina 521,500 *** South Dakota 447,880 *º- Tennessee 530,200 Mºrº Texas 322,930 ººk Utah 304,550 ** Vermont 487,888 ** Virginia 2,388,875 *** Washington 120,240 ** West Virginia 252,200 ** Wisconsin 422,000 arvº Totai Avail./Est. $31,117,651 $71,086,349 iſ if Cannot be distributed by geographic area in advance. 356 27-17 R{}RAL HOUSING SERVICE GEOGRAPHICBREAKDOWN OF OBLIGATIONS 2009 Actual and Estimated 2010 and 2011 Rural Community Facility Grants 2003/2004 Hurricanes for Natural Disaster 2009. 2010 2011 Total Awaii.fest. --- $535,687 / --> Rural Community Facility Grants 2005 Hurricanes for Natural Disaster 2009 2010 2011. Total Avail./Est. - - $542,570 iſ * -4. -> Rural Community Facility Grants 2007 Tornados Disasters 2009 2010 2011 Kansas $1 #,943,800 as wº -* Total Avail./Est. $11,943,800 $3,739,340 l/ - as Rural Community Facility Grants 2008 Disasters 2009 2010 2011 Arkansas $1,078,000 ** -*** Illinois 8,100 ** -- Indiana 186,700 sº tº º Iowa 2,146,341 *- **as Kansas 120,515 * * ** Kentucky 191,098 ** *—º Louisiana 187,731 wdºw ** Massachusetts 102,360 4-wº- ** Michigan 103,000 *- -º- Minnesota 32,000 anº ** Mississippi 419,750 ** gºº. Missouri 1,329,328 *** *sº Montana. 50,000 *- - Nebraska 54,200 ** * Nevada 32,417 **** *** New Hampshire 30,000 ** ** Tennessee 380,000 sºr -º-º- Texas 4,719,540 -- * * Vermont 79,200 ** *ts Washington 722,500 ** * * West Virginia 213,350 say ** Wisconsin 526,000 sº -º-º: Totai Avail./Est. $12,712, 130 $11,537,870 ºf -*. lf Cănnot be distributed by geographic area in advance. 357 27.18 RURAL, HOUSING SERVICE GEOGRAPHIC BREAKDOWN OF OBLIGATIONS 2009 Actual and Estimated 2010 and 2011 Rural Community Development Initiative Grants -- 2009 2010 2011 California $486,000 * * * *s Hawaii 374,475 *** * * Indiana 200,000 tºº * * Iowa 522,950 *** sº ºw Louisiana 261,475 *ge .* wº Maine 457,104 tº wº * * Maryland 371,451 * * ** Massachusetts 522,950 <º ºf * * Minnesota 461,475 J *º. wºsº. New York 156,000 * * * * Tennessee 261,475 tº sº. sº ºr Utah 105,700 see sº * * Washington 60,000 ** **** Total Avaii./Est. $4,241,055 $12,923,988 1/ * * Rural Cooperative Home Based Health Care Demo Grants Total Awaii./Est. - * *. $327,227.1/ ** Cannot be distributed by geographic area in advance. 358 Total Avail./Est, Alaska Arizona Michigan Minnesota Montana Nebraska North Dakota South Dakota Washington Wisconsin Total Avail./Est. Cannot be distributed by geographic area in advance. 27-19 RURALHOUSING SERVICE GEOGRAPHICBREAKDOWN OF OBLIGATIONS 2009 Actual and Estimated 2010 and 2011 Hazardous Weather Early Warning Grants 2009 -*- *wn 2010 $231,161 1/ Tribal College Grants 9 2009 $220,000 220,000 220,000 419,125 1,540,000 85,500 880,000 440,000 220,000 440,000 $4,684,625 $4,322,0001/ 2 1 359 27–20 RURAL HOUSING SERVICE GEOGRAPHHC BREAKDOWN OF OBLIGATIONS 2009 Actual and Estimated 2010 and 2011 Economic Impact initiative Grants 2009 23;{} 2011 Alabama ** $382,000 -wº Alaska $475,140 100,000 -- Arizona 166,780 232,000 - Arkansas 597,000 265,000 - £alifornia 140,250 393,000 -- Colorado 192,447 170,000 -- Connecticut * 107,000 -> Delaware 82,220 90,000 - Florida * 387,000 - Georgia 373,420 450,000 -- Hawaii 192,480 84,000 -- Idaho ** 135,000 -- Hłinois 164,882 252,000 - indiana eras 280,000 - Iowa 152,910 192,000 - Kansas 127,480 155,000 -- Kentucky 415,275 376,000 - Louisiana 206,480 262,000 -- Maine 139,300 168,000 - Maryland I67,250 148,000 -- Massachusetts 102,630 1 19,000 ** Michigan 772,000 389,000 --- Minnesota 121,500 234,000 - Mississippi 516,862 326,000 -- Missouri 250,330 310,000 -- Montana ** 128,000 -- Nebraska - 119,861 131,000 - Nevada - ** 121,000 - New Hampshire 100,000 122,000 -- New Jersey 301,020 122,000 - New Mexico 128,420 147,000 - New York 86,350 342,000 -- North Carolina 193,880 478,000 -- North Dakota 96,830 104,000 4- {Dhio •º- 377,000 - Oklahoma 180,494 241,000 --> Oregon ** 159,000 -4- Pennsylvania 306,190 383,000 - Rhode Island * 78,000 ** South Carolina 223,250 330,000 - South Dakota 207,010 122,000 -- Tennessee 520,220 391,000 -- Texas * 478,000 a- Utah 150,000 114,000 - Vermont 88,885 114,000 -- Virginia 1,114,193 321,000 - Washington 27,200 212,000 - West Virginia 183,530 210,000 - Wisconsin 133,500 258,000 -- Wyoming gºº 90,000 - Puerto Rico 493,231 157,000 -- Virgin Islands *- 75,000 - W. Pacific Areas 518,730 75,000 -* Undistributed *- 4,474,416 - Totai Avail./Est. $10,529,430 $16,360,416 -- If Does not include Administrative Expense obligations. 360 Alabama Alaska Arizona Arkansas California Colorado Connecticut Delaware Florida Georgia Hawaii Idaho iłłimous indiana Iowa Kansas Kentucky Louisiana Maine Maryland Massachusetts Michigan Minnesota Mississippi Missouri Montana Nebraska Nevada New Hampshire New Jersey New Mexico New York North Carolina North £)akota Ohio Oklahoma Oregon Pennsylvania Rhode Island South Carolina South Dakota. Tennessee Texas Utah Vermont Virginia Washingtoft West Virginia Wisconsin Wyoming Puerto Rico Virgin Islands W. Pacific Areas t}ndistributed Total Avail./Est. 27–21 RURAL. HCJSING SERVICE GEOGRAPHiC BREAKDOWN OF ÖBLIGATKONS 2009 Actual and Estimated 2010 and 2011 Rural Community Facility Loan Program - Direct 2009. 2010 $1,148,187 $7,884,000 2,750,000 2,156,000 11,679,706 4,634,000 2,308,000 5,623,000 4,884,486 8,372,000 3,335,840 3,782,000 2,797,000 2,395,000 100,000 1,838,000 -- 8,164,000 3,458,147 10,206,000 3,546,922 1,934,000 2,779,000 2,880,000 834,106 6,784,000 450,000 6,961,000 4,685,000 4,651,000 151,400 3,507,000 5,307,000 8,128,000 5,236,000 5,431,000 4,059,950 3,646,000 7,908,600 3,144,000 1,930,000 2,340,000 10,329,440 9,983,000 2,341,000 5,894,000 4,832,961 7,214,000 4,622,000 7,056,000 36,300 2,811,000 9,796,000 2,356,000 25,000 2,558,000 --- 2,622,000 4,405,000 2,323,000 6,910,459 2,962,000 5,423,090 7,901,000 12,892,565 i 1,470,000 Gł7,300 2,061,000 10,181,356 9,793,000 4,766,594 5,156,000 9,000,000 4,044,000 12,850,140 9,242,000 *** 1,442,000 --- 7,284,000 1,741,800 2,431,000 S,0i4,403 8,928,000 6,545,237 11,170,000 3,240,000 2,273,000 441,950 2,486,000 13,480,284 7,007,000 4,233,000 4,736,000 5,104,000 4,102,000 4,749,300 6,344,000. 96,000 1,849,000 1,125,800 2,764,000 - -- 1,275,000 480,000 1,275,000 - - 616,152,662 $217,824,008 $881,621,662 2011 $2,670,000 760,000 1,586,000 i,916,000 2,832,000 1,302,000 840,000 654,000 2,763,000 3,444,000 686,000 1,002,000 2,303,000 2,362,000 1,592,000 1,211,000 2,751,000 1,852,000 1,257,000 1,090,000 822,000 2,269,000 2,005,000 2,446,000 2,394,000 979,000 994,000 894,000 916,000 816,000 1,029,000 2,675,000 3,765,000 729,000 3,306,000 1,760,000 i,390,000 3,122,000 522,000 2,470,000 853,000 3,018,000 3,765,000 799,000 870,000 2,377,000 1,620,000 i,409,000 2,156,000 658,000 963,000 467,000 467,000 205,440,000 $295,038,000 361 27–22 RURALHOUSING SERVICE RURAL COMMUNITY FACILITIES PROGRAM ACCOUNT Classification by Objects 2009 Actual and Estimated 2010 and 2011 - FY 2009 FY 2010 FY 2011 ther Objects: - * - 5 Other purchases of goods and services , from government accounts.................. $5,100,000 $0 $0 1 Grants, subsidies, and contributions......... 131,960,381 188,341,018 41,717,000 - 41,717,000 otal direct obligations.............................. 137,060,381 188,341,018 362 27–23 RURAL, HOUSING SERVICE The estimates include appropriation language for this item as follows (new language underscored; deleted matter enclosed in brackets): Rural Housing Insurance Fund Program Account (including transfers of funds) 2,3 7,8 11 The first change imposes limits on the section 502 guaranteed loan levels. The second change provides funding to section 502 direct loans only The third change eliminates funding for unsubsidized guaranteed loans as well as the period of funding availability The fourth change includes the subsidy costs for section 524. The fifth change removes the word “and” The sixth change includes the subsidy costs for section 523. For gross obligations for the principal amount of direct and guaranteed loans as authorized by title of the Housing Act of 1949, to be available from funds 1n the rural housing insurance fund, as follows: [$13,121,488,000]$13,200,000,000 for loans to section 502 borrowers, of which [$1,121,488,000]$1,200,000,000 shall be for direct loans, and of which $12,000,000,000 shall be unsubsidized guaranteed loans without regard to section 710 of the Agriculture, Rural Developmer Food and Drug Administration, and Related Agencies Appropriations Act, 2006 (Public Law 109– 97); [$34,412,000]$34,004,000 for section 504 housing repair loans; [$69,512,000]$95,236,000 fo section 515 rental housing; S129,090,000]$129,133,000 for section 538 guaranteed multi-family housing loans; [$5,045,000]$5,052,000 for section 524 site loans; [$11,448,000; $11,449,000 for credit sales of acquired property, of which up to [$1,448,000]$1,449,000 may be for multi-family credit sales; and [$4,970,000]$4,966,000 for section 523 self-help housing land development loan For the cost of direct and guaranteed loans, including the cost of modifying loans, as defined in section 502 of the Congressional Budget Act of 1974, as follows: section 502 loans, [$213,510,000, of which $40,710,000 $75,120,000 shall be for direct loansf, and of which $172,800,000, to remain available until expended, shall be for unsubsidized guaranteed loans]; section 504 housing repair loans, [$4,422,000]$6,437,000; repair, rehabilitation, and new construction of section 515 rental housing, [$18,935,000]$32,123,000; section 538 multi-family housing guaranteed loans, [$1,485,000 $12,513,000; section 524 site development loans, $294,000; [and] credit sales of acquired property, $556,000; and section 523 self-help land development housing loans, $288,000: Provided, That of the total amount appropriated in this paragraph, the amount equal to the amount of Rural Housing Insurance Fund Program. Account funds allocated by the Secretary for Rural Economic Area Partnership Zones for the fiscal year [2009|2010 shall be available through June 30, [2010]2011 for communities designated by the Secretary of Agriculture as Rural Economic Area Partnership Zones: Provided further, That section 538 multi-family housing guaranteed loans funded pursuant to this paragraph shall not be subject to a guarantee fee and the interest on such loans may not be subsidized: Provided further, That any balances for a demonstration program for the preservation and revitalization of the section 515 multi-family rental housing properties as authorized by Public Law 109–97, and Public Law 110-5, and Public Law 111–80 shall be transferred to and merged with the “Rural Housing Service, Multi-family Housing Revitalization Program Account” In addition, for administrative expenses necessary to carry out the direct and guaranteed loan programs, [$468,593,00013454,383,000, shall be [transferred and merged with paid to the appropriation for “Rural Development, Salaries and Expenses” 363 27-24 [he seventh change modifies the fiscal year from 2010 to 2011. [he eighth change modifies the availability of set-aside funds for rural economic area partnership Zones from June 30, 2010 to June 30, 2011. The ninth change removes the word “and” [he tenth change adds Public Law 111-80. [he eleventh change updates the administrative funding level and provides authority to move the finds o the Rural Development, Salaries and Expense account. 364 27-25 RURAL HOUSING SERVICE Analysis of Change in Appropriation RURAL HOUSING INSURANCE FUND PROGRAM ACCOUNT (On basis of loan level, subsidy, and administrative expenses) - Administrative Loan Level Subsidy Expenses Appropriations Act, 2010......................... $13,337,568,461 $238,908,000 $468,593,000 Budget Estimate, 2011............................... 13,479,839,161 127,331,000 454,383,000 Increase or Decreases in Appropriations........ 142,270,700 -111,577,000 -14210,00 à PROJECT STATEMENT (On basis of supportable loan levels and apploptiated subsidies and administrative expenses) (In thousands of dollars) Actual 2009 Estimated 2010 Increase ol Decrease Estimated 2011 Item of Change Plogiam Level Subsidy/BA |Program Level Subsidy/BA. Program Level | Subsidy/BA. Piogram Lºwell Subsidy'BA Single family housing (SFH) direct loans $1,121,215 $75,346; $1,121,488 $40,710 $78,512 (1) $34,410 (4) $1,200,000 $75,120 SFH dilect loans - emergency supplernental aſ 0. {} 0 () 0 0 () () SFH dilect loans - 2005 hurricanes emergency supplemental bf 18,579 1,249 0 () () {} 0 {) SFH direct loans - 2007 emergency supplemental g/ 95 6 0 0 () 0 {} O SFH direct loans - ARRA iſ : 267,124 17,951 0 0 0 0 0 0 SFH direct loans - 2008 disastels emer supplemental hy 48,846 3,282 () 0 () 0 0 0 SFH guaranteed loans - purchase 5,634,038 71,552 i 1,961,563 172,800 38,437 (9) -172,800 (5) 12,000,000 0 SFH guaranteed loans - 1efinance 39,201 384 () O 0 0 0 Ö SFH guar 2005 hurricanes emergency supplemental b/ 582,025 7,392 {} 0 0 {} 0 0 SFH guar 2007 emergency supplemental g/ 192 2. 0 {} 0 0 0 0 SFH guar 2008 disastels h/ H 920,272 11,687 0 Q 0 0 () 0 SFH guaranteed loans - pulchase - ARRA iſ 8,557,498 108,679 {} 0 0 Ö 0 0 SFH guaranteed loans - refinance - ARRA iſ 482,013 4,724 0 0 0 0 0 0 Ruial ſental housing direct loans 67,738 27,881 69,512 18,935 25,724 (2) 13,188 (6) 95,236 32,123 Multi-family housing guaranteed loans 120,852 8,080 129,130 1,485 3 (3) 11,028 (7) 129,133 12,513 Multi-family housing guaranteed loans 2008 dis emer supp hſ 11,663 749 0 0 0 {} O 0 Housing repail direct loans 26,814 7,205 34,412 4,422 -408 (3) 2,015 (7) 34,004 6,437 Housing repail direct loans - emergency supplemental aſ 3 ! Q 0 0 () Ö 0 Housing repair direct loans -2005 hurricanes emergency supp, b/ 208 56 0. 0 () 0 O 0 Site development direct loans c/ 599. () 5,045 0 7 (3) 294 (7) 5,052 2.94 Self-help housing land dev loans iſ () Ö 4,970 {} -4 (3) 288 (7) 4,966 288 Single-family housing Cledit sales d/ 1,032 0 10,000 0 O () 10,000 0 Multi-family housing credit sales 1,448 523 1,448 556 1 (3) 0 1,449 556 Totai Available of Estimate 17,901,454 346,749 || 13,337,568 238,908 142,271 -111,577 13,479,839 127,331 Total administrative expenses eſ 0 460,217 0 468,593 0 -14,210 (8) O 454,383 Total administrative expenses - ARRA iſ {} 6,000 0 0 0 0 Q () Total administrative expenses - 2008 disasteish/........................ 0 1,380 0 0 O 0 0 () Recovely of pliol year obligations -30,000 -1,372 {} {} 0 0 Q 0 Unobligated balance available, start of year -134,989 -9,140 Ö 0 Q 0 {} 0 Unobligated balance available, end of year 3,981,291 122,732 0 0 0. O O 0 Transferred to Working Capital 8,970 1,157 0 0 O 0 0 0 ; # P STA (On basis of supportable loan levels and appropriated subsidies and administrative expenses) (In thousands of dollars) Actual 2009 Estimated 2010 Increase or Decrease Estimated 2011 r Item of Change Program Level Subsidy/BA Program Level Subsidy/BA. Program Level | Subsidy/BA |Program Level Subsidy'Bé Transfer of unobligated balance - 2005 hurricanes emer. from - RD disaster assistance fund.............................................. -1,319,308 -23,000 () {} 0 0 () 0 Transfer of unobligated balance -2008 disasters from RD disaster assistance fund............................................. -1,514,700 -44,620 0 0 0 0 O 0 Tornado transferred to CF grants g/....................................... 4,923 1,065 0 0 0 0 {) 0 *RAAppropriations iſ… -11,296,641 –200,000 0 O 0. O 0. 0 Total loans and subsidies 7,601,001 200,951 13,337,568 238,908 142,271 -111,577 13,479,839 127,331 Total administrative expenses 0 460,217 0 468,593 0 -14,210 O 454,383 § à PR TATEMENT (On basis of available loan levels, subsidies and administrative expenses) (In thousands of dollars) -—-r- * - Actual 2009 . Estimated 2010 increase or Decrease Estimated 2011 Item of Change |Program Level Subsidy/BA |Program Level Subsidy/BA. Program Level Subsidy/BA |Program Leyeli Subsidy/BA Single family housing (SFH) directloans. t; $1,121,215 $75,346|| $1,121,488 $40,710; $78,512 $34,410 $1,200,000 $75,120 SFH direct loans - emergency supplemental aſ, ........................... Ö Ö 2,106 76 -2,106 -76 - () 0 SFH direct loans - 2005 hurricanes emergency supplemental b/....... 18,579 1,249 183,048 6,645 -183,048 -6,645 () 0 SFH direct loans - 2007 emergency supplemental g/..................... 95 6 13,005 472 -#3,005 -472 0 0 SFH direct loans - ARRA iſ................................................. 267,124 17,951 1,295,847 47,039 -1,295,847 -47,039 () 0 SFH direct loans - 2008 disasters emer, supplementally.............. 48,846 3,282 711,597 25,831 –711,597 -25,831 Q 0 SFH guaranteed loans - purchase 5,634,038 71;552 12,346,097 177,784 -346,097 -177,784 12,000,000 () SFH guaranteed loans-refinance º 39,201 384 200,609 3,450 -200,609 -3,450 O O SFH guar. 2005 hurricanes emergency supplemental b/................. . 582,025 7,392. 622,530 8,964 -622,530 -8,964 0 {} SFH guar. 2007 emergency supplemental gl............................ .. 192 2 13,504 194 -13,504 -194 0. 0 SFH guar. 2008 disastersh/................................................. 920,272 11,687 131,427 1,893 -131,427 -1,893 {} () SFH guaranteed loans - purchase - ARRA iſ 8,557,498 108,679 1,007,673 14,510 -1,007,673 -14,510 () () SFH guaranteed loans - refinance - ARRA iſ - * 482,013 4,724 63,776 1,097 -63,776 -1,097 () Ö Rural rental housing direct loans........................................... 67,738 27,881 69,512 18,935 25,724 13,188 95,236 32,123 Rural Tental housing direct loans - 2007 emergency suppl. g/.......... O 0 1,403 382 -1,403 -382 {) {) Multi-family housing guaranteed loans.................................... 120,852 8,080 129,130 1,485 3 11,023 129,133 12,513 Multi-family housing guaranteed loans. No Year....................... 0 0 12,357 142 -12,357 -142 0 0 Multi-family housing guaranteed loans 2008 dis. emer. Supp. hſ....... 11,663 749 6,178 1,191 -6,178 -1,191 0. {} Housing repair directloans............................................. * * * * * * 26,814 7,205 34,412 4,422 –408 2,015 34,004 6,437 Housing repair direct loans - emergency supplemental aſ............... 3 1 6,372 883 -6,872. -883 0 0 Housing repair direct loans - 2003/2004 hurricanes emerg. Supp. f..., {} () 33,585 4,316 -33,585 -4,316 () Q Housing repair direct loans - 2005 hurricanes emergency Supp. bſ.... 208 56 857 110 -857 -110 ()} : 0 Housing repair directloans -2007 emergency supplemental g|......... 0 () 119 15 -119 -15 0 0 Direct farm labor loans disast 0 0 1,483 536 -1,483 .536 () 0 Site development direct loans g/ . 599 () 5,045 0 7 294 5,052 294 Self-help housing land dev. 10ams iſ . . 0 0 4,970 | () -4 288 4,966 288 Single-family housing creditsales dſ 1,032 0 10,000 () O * O 10,000 () Multi-family housing creditsales - 1,448 , 523 1,448 556 1 () 1,449 556 Total Available or Estimate 17,901,454 346,749 18,030,078 361,640 -4,550,239 –234,309 13,479,839 127,331. Total administrative expenses e.............. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0 460,217 {} 463,593 Q -14,210 454,383 Total administrative expenses - ARRA iſ.................................. {} 6,000 0 0 Ó () 0 O Total administrative expenses-2008 disastersh!......................... {} { . 1,380 Ö {} {} () 0 O Recovery of prior year obligations........... -30,000 -1,372 0 () Q 0 O 0 Unobligated balance available, start of year............................... -134,989 -9,140 –4,789,914 -122,732 Ö {} {} 0 Unobligated balance available, end of year . 3,981,291 122,732 * {} 0 () () {} 0 Transferred to Working Capital............................................: 8,970 1,157 {} 0 () 0 0 Ö ; 3. PROJECT STATEMENT (On basis of available loan levels, subsidies and administrative expenses) (In thousands of dollars) Actual 2009 Estimated 2010 Inclease or Decrease Estimated 2011 - Item of Change Program Level; Subsidy/BA Plogiam Level. Subsidy/BA |Program Level; Subsidy/BA || Piogram Level Subsidy/BA Tiansfer of unobligated balance - 2005 hurricanes emer from * . RD disastel assistance fund & s - -1,319,308 -23,000 0 0 0. 0 O Ö Transfel of unobligated balance - 2008 disastels fiom RD disaster assistance fund -1,514,700 -44,620 Ö 0 O Ö 0 0 Tornado transferred to CF grants g; 4,923 1,065 0 0 {} 0. Ö {} ARRAAppropriations iſ..................................................... -11,296,641 -200,000 0 () 0 0 0 0 Total loans and subsidies * 7,601,001 200,951 13,240,164 238,908 142,271 -111,577 13,479,839 127,331 Total administiative expenses 0 460,217 0 468,593 () -14,210 O 454,383 Staff-years are leflected in the Salaries and Expenses Project Statement NOTE: Individual columns may not add due to rounding § 369 27–30 Project Statement Footnotes f h/ iſ j/ Provided by the Omnibus Appropriations Act FY2000, P.L. 106-113, dated November 29, 1999 and FY 2000 Emergency Supplemental Appropriations Act, P.L. 106-246, dated July 13, 2000. Provided by the Department of Defense, Emergency Supplemental Appropriations to Address Hurricanes in the Gulf of Mexico, and Pandemic Influenza Appropriations Act, 2006, P.L. 109- 148, signed December 30, 2005, for the purpose of serving communities affected by 2005 calendar year hurricanes. Additional appropriations were provided in P.L. 110-329 and transferred from the Rural Development Assistance Disaster Fund. Negative subsidy rates of 1.84% and 4.22% were calculated for FY 2009 and FY 2010, respectively. Therefore, corresponding budget authority is not required to support the loan levels. Negative subsidy rates of 2.59%, 15.63%, and 11.12% were calculated for FY 2009, FY 2010 and FY 2011, respectively. Therefore, corresponding budget authority is not required to support the loan level. e In FY 2009, funding of $460,217,000 was appropriated and transferred to the Rural Development Salaries and Expense Account. In FY 2010, funding of $468,593,000 was appropriated and transferred to the Rural Development Salaries and Expense Account. In FY 2011, funding of $454,383,000 is requested and will be paid to the Rural Development Salaries and Expense Account. - . Provided by the Emergency Hurricane Supplemental Appropriations for Disaster Assistance Act of 2005, P.L. 108-324, signed October 13, 2004, for the purpose of serving communities affected by tropical storms and hurricanes during calendar years 2003 and 2004. Provided by the U.S. Troop Readiness, Veterans' Care, Katrina Recovery, and Iraq Accountability Appropriations Act, 2007, P.L. 110-28, dated May 25, 2007, for areas in Kansas hit by the tornadoes on May 6, 2007. - - . Transferred from the Rural Development Disaster Assistance Fund provided by the Consolidated Security, Disaster Assistance, and Continuing Appropriations Act, 2009, PAL. 110-329, dated September 30, 2008, to provide additional amounts for authorized activities of agencies of the Rural Development Mission Area in areas affected by a disaster declared by the President or the Secretary of Agriculture. - Provided by the American Recovery and Reinvestment Act of 2009, P.L. 111-5, signed February 17, 2009, for the purpose of making supplemental appropriations for job preservation and creation, infrastructure investment, energy efficiency and science, assistance to the unemployed, and State and local fiscal stabilization. The funds are available through the fiscal year ending September 30, 2010. - . - Negative subsidy rate of 2.24% was calculated for 2010. Therefore, corresponding budget authority is not required to support the loan level. - - 370 1) (2) (3) (4) (5) 27–31 JUSTIFICATION OF INCREASES AND DECREASES An increase of $78,512,000 in single family directhousing insurance fund loans ($1,121488,000 available in 2010). To support the goal of providing housing to the most rural, the neediest residents, the 2011 budget includes an increase for the 502 direct program to support a loan level of $1.2 billion The Section 502 direct loan program expects to fund approximately 9,100 loans in FY 2011. These funds will result in an additional 600 homes being financed over what would have been possible with the $1.121 billion level for the program. An increase of $25,724,000 in direct rural rental housing loans ($69.5 12,000 available in 2010 }. The 2011 budget increases the 515 direct loan level to $95 million. The proposed increase reflects growing demand for new construction and revitalization of the multi-family housing portfolio where the average property age now exceeds 30 years. The increase will enable the Department to build new Section 515 properties along with the proposed new construction rental assistance. The increase will also provide a limited amount of funding for rehabilitation and repair of a limited amount of aging properties. A decrease of $401,000 in loan level for the guaranteed multi-family housing, housing repair and rehabilitation, site development direct, self-help housing land development, and multi-family credit sales loans ($185,005,000 available in 2010). The decrease is due to rounding and changes in subsidy rates. With the adjustments to these accounts, the budget provides approximately the same amount of program level available in FY 2010. - - An increase of $34,410,000 in loan subsidy for direct housing insurance funds loans ($40,710,000 available in 2010). - - The requested subsidy amount supports the estimated loan obligations associated with the requested FY 2011 loan levels for the direct single family housing loans program. The amount is significantly increased because the subsidy rate increased from 3.63 percent to 6.26 percent. A decrease of $172,800,000 in loan subsidy for guaranteed housing insurance fund loans ($172,800,000 available in 2010). - - The budget does not request budget authority for this program. A loan level of $12 billion will be supported by establishing a fee structure that will eliminate the subsidy cost for all new purchases. This fee structure will be similar to that of HUD’s FHA guaranteed loans, The up-front fee on new purchase loans will remain 2 percent, but an annual fee of 0.15 percent will be added to both new and refinanced loans. In addition, the up-front fee for refinanced loan guarantees will be increased to 1 percent. This change allows the subsidy for the loans to be completely offset without a significant additional burden to the borrowers, given that they can finance the up-front fee as part of the loan and the annual fee will be a nominal amount added to the monthly payment. This allows RHS to provide about the same level as in 2010, $12 billion, with no budget authority. The fee change is achieved through a General Provision (GP). There are two GPs that affect the 502 Single Family Housing Guarantee loan program and they are as follows: General Provision '720): 3.71 (6) (7) 27–32 (a) Section 502 (h)(8) of the Housing Act of 1949 (42 U.S.C. 1472 (h) (8)) is amended by striking "I" and inserting in lieuthereof"2" and inserting at the end thereof the following new sentence: "In addition, the Secretary may collect from the lender an annual fee of equal to but not more than 0.5 percent of the outstanding principal balance of the loan for the life of the loan." - (b) Section 739 of the Agriculture Rural Development, Food and Drug Administration, and Related Agencies Appropriation Act, 2001 (H.R. 5426 as enacted by Public Law 106-387, 115 Stat. 15494- 34) is repealed. Part (a) of this language will codify the 2 percent up-front fee on the section 502 single family housing guaranteed loans. Current law for this program is a 2 percent up-front fee, but the U.S. Code has not been formally changed to reflect this. Updating this in the code will reduce confusion on what the current law is on this program. This language provide new authority for the section 502 single family housing guaranteed loan program to change an annual fee, similar to HUD’s FHA program. The cap on the annual fee of 0.50 is higher than what RHS is actually proposing to charge in 2011, which is 0.15. The cap is set to provide a small amount of flexibility in the annual fee to ensure that the program can maintain a negative subsidy rate for the program cost. The language for part (b) repeals the appropriations language where the 2 percent up-front fee in now located in law, it is no longer needed once Part (a) is passed. General Provision . 722: In carrying out subsection (h) of section 502 of the Housing Act of 1949, the Secretary may use the authority described in subsections (h) and (j) of section 538 of such Act. This language will allow the section 502 single family housing guaranteed loan program to be a direct endorsement program just like FHA guarantees and VA home loan guarantees. Specifically, this will allow lenders to issue the guarantee on behalf of the Federal government without the RHS have to approve in a separate step. Currently the section 538 multifamily housing loan guarantee program has the authority to operate as a direct endorsement loan guarantee. The language is written to refer to the authorities in the 538 program and make them applicable to the section 502 single family housing guaranteed loan program. By making the section 502 single family housing guaranteed loan program a direct endorsement program, RHS will be able to be more efficient with its staff resources and dedicate more time to reviewing section 502 single family housing direct loan originations, An increase of $13,188,000 in subsidy for direct rural rental housing loans ($18,935,000 available in 2010). - - The proposed increase supports the estimated loan obligations associated with the requested FY 2011 loan levels for the direct rural rental housing loans program. The increase is due to an increase in the subsidy rate from 27.24 percent to 33.73 percent and the growing demand for new construction. An increase of $13,625,000 in loan subsidy for guaranteed multi-family housing, housing repair and rehabilitation, site development, and self-help housing land development ($6,463,000 available in 2010). * The proposed increase supports the estimated loan obligations associated with the requested loan level in FY 2011. The increase in subsidy rates is a result of an annual technical assumption, increase in default rates, and interest changes as forecasted in the President’s 2011 budget economic assumptions. 372 (8) (9) 27–33 A decrease of $14,210,000 in administrative expenses ($468,593,000 available in 2010). Justification for administrative expenses in the amount of $454,383,000 and the associated staff-years are reflected in the Rural Development Salaries and Expenses Project Statement. An increase of $38,436,692 in single family guaranteed housing insurance fund loans ($11,961,563,308 available in 2010). - The 2010 enacted level would have been $12 billion if RHS had executed solely new/purchase single family housing loan guarantees. However, some of the BA was used to provide a small amount of refinancing. The 2010 purchase subsidy rate was slightly lower than the refi subsidy rate. Therefore, the total loan level in 2010 is slightly below $12 billion. For the 2011 budget, RHS is providing the $12 billion loan level that was anticipated in 2010, rather than the actual. In addition, the 2011 budget blends the new/purchase subsidy rate with the refi subsidy rate for one 502 guarantee rate. This change will alleviate small differences in expected loan levels v. actual going forward and reduce confusion. 373 Alabama Alaska Arizona Arkansas California Colorado Gonnecticut Delaware Florida Georgia Hawaii Idaho filinois Indiana Howa Kansas Kentucky Louisiana Maine Maryland Massachusetts Michigan Minnesota Mississippi Missouri Montana Nebraska Nevada New Hampshire New Jersey New Mexico New York North Carolina |North Dakota Ohio Ukiahoma Oregon Pennsylvania Rhode Island South Carolina South Dakota Tennessee Texas Utah Vermont Virginia Washington West Virginia Wisconsin Wyoming Puerto Rico Virgin Islands W. Pacific Areas Undistributed Total Avail.ſºst, 27–34 RURAL HOUSING SERVICE GEOGRAPHICBREAKDown of OBLIGATIONS 2009 Actual and Estimated 2010 and 2011 Single Family Housing Direct Loans 2009 2010 2010 $21,144,734 $21,263,000 $22,717,000 11,915,381 7,734,000 9,188,000 20,908,277 13,277,000 #4,731,000 23,973,434 I7,145,000 18,599,000 63,628,204 29,582,000 31,035,000 19,788,818 łł,313,036 12,767,000 5,784,910 6,658,000 8,112,000 it,613,277 5,753,000 7,207,000 36,613,853 20,531,000 21,985,000 32,557,950 26,697,000 28,450,000 12,667,604 7,728,000 9,182,000 23,060,657 9,060,000 10,514,000 24,882,565 19,670,000 21,124,000 26,880,704 19,606,000 21,060,000 20,315,033 14,521,000 15,975,000 9,240,607 11,975,000 13,429,000 33,292,006 20,748,000 22,202,000 22,937,539 i8,098,000 19,552,000 27,898,874 10,615,000 12,069,000 13,453,538 10,024,000 11,478,000 11,187,000 7,712,000 9,166,000 35,191,956 25,350,000 26,803,000 23,072,616 18,091,000 19,545,000 22,506,494 19,740,000 21,194,000 21,678,325 20,759,000 22,213,000 20,008,764 8,409,000 9,863,000 8,907,840 9,690,000 1,144,000 7,886,465 6,026,000 7,480,000 12,686,269 7,973,000 9,427,000 10,064,670 7,288,000 8,742,000 6,371,985 t 1,750,000 13,204,000 19,986,808 24,151,000 25,604,000 49,616,860 34,717,000 36,170,000 5,529,357 6,800,000 8,254,000 39,508,244 26,2{5,000 27,568,000 19,192,378 16,052,000 17,506,000 22,936,667 13,875,000 15,329,000 37,678,452 29,463,000 30,916,000 3,31 i,730 4,537,000 5,991,000 26,990,163 19,932,000 21,386,000 9,979,202 8,208,000 9,662,000 31,983,638. 22,268,000 23,722,000 30,333,381 47,994,000 49,447,000 36,950,408 6,989,000 8,443,000 10,284,068 7,458,000 8,912,000 28,034,552 20,175,000 24,629,000 43,945,620 15,579,000 17,033,000 17,650,870 13,490,000 i4,944,000 20,370,158 19,742,000 21,166,000 6,762,493 5,348,000 7,802,000 12,226,871 9,293,000 10,747,000 2,247,427 5,301,000 6,761,000 3,575,081 2,000,000 3,454,000 be tº 316,144.603. 317,597,000 $1,121,214,777 $1,121,487,603 $1,200,000,000 :::::::::::::::::::::::::::::::::::::::::::: 374 27–35 RURAL HOUSING SERVICE * GEOGRAPHIC BREAKDOWN OF OH}_{GATIONS - 2009 Actual and Estimated 2010 and 2011 Single-Family Housing Direct Loans - Recovery Act 2009 2010 2011 Alabarma $3,239,306 - -- Alaska 2,582,174 *r- * * Arizona 2,064,785 -- -- Arkansas 2,578,656 ** **- California 15,245,304 -- . ** Colorado 4,904,818 - sº-sº -- Connecticut 1,628,095 ---> * Delaware 2,497,268 ** - -* Florida 6,084,231 * , -- Georgia 8,201,856 •e- --- Hawaii 651,255 - tº- -* Hoaho 16,500,767 *- * Illinois 4,137,153 ºs- ** Indiana 6,194,568 ** ** Iowa 4,050,084 *- -* Kansas 1,338,234 ** - Kentucky 9,345,387 *- ** Louisiana 7,041,494 *- - -ºvº. Maine 7,382,722 *- *g Maryland 6,724,247 - - Massachusetts 1,585,200 - ** Michigan 8,701,907 * wºrs Minnesota 3,075,825 eºrº. sº Mississippi 3,761,573 *- * Missouri 3,919,751 -- *g Montana 10,182,273 -- *** Nebraska 1,329,994 * -- *** Nevada 1,424,523 tº- wº- New Hampshire 6,260,399 - - . -- New Jersey 4,887,343 †- -- New Mexico 913,278 - ** New York 1,942,300 * --- North Carojiria 9,682,184 -- *** North Dakota 1,002,051 *- ** Ohio 7,084,175 ** *sº Oklahoma 4,487,710 *º- ** Oregon 10,099,036 ºrº ** Pennsylvania 9,996,623 ºr- ** Rhode Island 1,046,500 * * -- South Carolina 7,765,472 º- ** South Dakota l,566,168 -- *s Tennessce 10,716,075 *-- * Texas 1,007, 14 4- * Utah 8,168,898 - . -- ** Vernont 3,633,520 - ** Virginia 8,625,024 *-- --- Washington 8,528,856 ** ** West Virginia 4,877,010 ** -- Wisconsin 2,204,668 - | -- * Wyoming 612,203 ** ** Puerto Rico 5,264,090 ** -- Virgin Islands 380,000 *- * W. Pacific Areas --- -- ** Undistributed * - **saº' ** Total Avail.JPst, $267,124,147 1,295,847,302 1/ -*. 1/ Cannot be distributed by geographic area in advance. 375 Total Avail./Est, Alabama Florida Louisiana Mississippi Texas Total Avail./Est. Kansas Total Avail/Est. Arkansas Colorado Florida Georgia Illinois Indiana Iowa Kentucky Louisiana Maine Mississippi Missouri Nebraska Tennessee Texas West Virginia Wisconsin Total Avail./Est, 27-36 RURAL, HOUSING SERVICE GEOGRAPHICBREAKDOWN OF OBLIGATIONS 2009 Actual and Estimated 2010 and 2011 Single Family Housing Direct Loans for Natural Disasters 2009 20:0 ** $2,105,999 1/ Single Family Housing Direct Loans 2005 Hurricanes for Natural Disasters 2009 2010 $674,000 tº dº 7,042,748 ** 8,072,758 ** 2,667,822 ** 124,900 $18,579,228 / _$183,048,031.1/ Single Family Housing Direct Loans 2007 Tornados Disasters 2009 2010 $95,350 *ºtº 95,350 $13,005,417 1/ Single Farmily Housing Direct Loans 2008 Disasters 2009 $4,509,654 sº-sº 189,000 ** 930,106 ** 665,420 ** ł,871,755 ** 13,788,675 ** 5,505,068 * * 1,054,044 ** 2,317,408 ** 5,246,023 ~~ 354,039 ** 7,746,533 ** 617,944 ** 358,947 - 2,638,093 - -- 79,800 * * 973,044 ** $48,845,553 $711,597,184.1/ 1/ Cannot be distributed by geographic area in advance. 2 {} i {} sº-gº-mºmº 2 {} ! {} *mºsº 376 Alabama Alaska Arizona. Arkansas California Colorado Connecticut Delaware Florida georgia Hawaii Idaho illinois Indiana Iowa Kansas Kentucky Louisiana Maine Maryland Massachusetts Michigan Minnesota Mississippi Missouri Montana Nebraska Nevada New Hampshire New Jersey New Mexico New York North Carolina North Dakota {Dhio Qklahoma Cregon Pennsylvania Rhode Island South Carolina South Dakota Teriftessee Texas Utah Vermorſt Virginia Washington West Virginia Wisconsin Wyoming Puerto Rico Virgin Islands Western Pacific Undistributed Total Awaii.fest. 27-37 Rural Housing Service GEOGRAPHICBREAKEDOWN OF OBLIGATIONS 2009 Actual and Estimated 2010 and 2011 Single Family Housing Guaranteed Loans 2009 2010 $130,739,999 $186,030,250 19,951,195 50,562,750 154,909,563 176,639,900 123,940,878 195,122,970. 205,684,764 352, #69,720 79,282,972 95,026,750 26,742,605 36,771,200 21,149,237 27,254,662 340,492,221 347,599,595 188,964,498 265,529,670 47,868,319 55,735,050 85,115,952 99.4 is, 316 171,654,428 206,400.407 110,425,370 176,609,677 71,518,021 117,233,480 83,556,747 95,461,056 101,550,843 186,743,766 161,574,666 296,698,307 88,234,322 105,220,678 90,500,180 101,993,621 42,090,768 49,184,807 267,657,323 234,577,900 160,454,959 185,354,032 106,189,554 185,559,360 154,408,925 227,443,844 56,355,716 63,241,513 32,631,369 67,449,130 24,544,749 34,265,552 48,846,212 56,493,895 51,330,094 51,137,220 26,982,750 94,478,230 68,990,651 254,842,350 329,535,179 401,919,554 15,288,471 30,802,240 149,741,828 245,328,460 121,532,955 143,542,478 ti 1,447,822 154,623,107 142,727,652 286,239,310 5,570,224 7,393,542 149,209,247 176,854,580 60,254,159 62,211,483 139,833,122 203,156,360 283,325,683 509,336,380 92,380,554 110,802,029 15,204,510 46,454,310 156,412,091 I99,104,931 141,925,831 179,058,567 59,387,638 105,170,240 131,200,317 187,088,472 102,782,536 74,581,568 114,322,009 121,709,727 814,500 21,472,010 6,035,722 10,060,000 * 4,546,703,365. $5,673,238,900 $12,546,705,365 20; i. $177,011,000 41,544,000 167,621,000 186,104,000 343,451,000 86,008,000 21,753,000 18,237,000 338,491,000 256,511,000 46,626,000 90,396,000 197,382,000 167,591,000 108,214,000 86,442,000 177,725,000 287,679,000 ,96,202,000 92,975,000 40; 68000 275,559,000 176,335,000 176,540,000 218,425,000 54,223,000 58,430,000 25248000 47,477,000 42,120,000 85,459,000 245,823,000 392,901,000 21,784,000 237,309,000 134,523,000 145,604,000 247,220,000 7,788,000 167,336,000 $3,192,000 194,132,000 500,317,000 101,783,000 37,435,000 190,086,000 170,039,000 96,151,000 178,069,000 65,862,000 112,690,000 12,414,000 992,000 4,498,403,000 $12,000,000,000 377 27–38 RURAL, HOUSING SERVICE GEOGRAPHICBREAKDown of OBLIGATIONS 2009 Actual and Estimated 2010 and 2011 Single Family Housing Guaranteed Loans Purchase 2009 2010 201 | Alabama $31,791,819 - • * * . . 4-ºxº Florida 131,344,927 **e *aces, Louisiana 321,198,205 ** **t Mississippi 95,850,771 ** ** Texas 1,839,245 - ** ** Undistributed wº - ** ** Total Avail./Est. $582,024,967 $622,529,530 1/ ** Single Family Housing Guaranteed Loans Purchase 2007 Tornados Disasters 2009 2010 2011 Kansas $192,000 ** *.*. Totai Avail./Est. _$192,000 $13,503,722 1/ ** Single Family Housing Guaranteed Loans Purchase 2008 Disasters 2009 . . 2010 2011 Arkansas $162,503,621 ºº: º sº, Colorado 1,866,580 ** - * tº Florida ió8,366 . -- **** Georgia 15,444,742 *º- awºw. Illinois 51,577,277 ** was alsº Indiana 141,751,034 ** *A* Iowa 93,478,695 -- **º Kentucky 19,149,861 ** *A* Louisiana 44,072,482 - - tº wº ** Maine 17,361,889 *** - ** Mississippi 14,485,302 wºm **- Missouri 143,346,822 ** ** Nebraska 15,074,493 ** t ** Nevada 13,246,254 * * ~~ Tennessee 30,138,746 nº try * * Texas 36,380,720 ** . -- West Virginia 11,045,669 . ** ** Wisconsin 109,179,660 - ** *** Undistributed - -- *sº ** Total Avail./Est. $920,272,213 $131,426,549 }/ . ** 2005 Hurricanes for Natural Disaster 1/ Cannot be distributed by geographic area in advance. 378 27–39 RURALHOUSING SERVICE . GEOGRAPHIC BREAKD GWN OF ÖBLICATIONS 2009 Actual and Estimated 2010 and 2011 Single Family Housing Guaranteed Loans =ºse #1 Cannot be distributed by geographic area in advance. Recovery Act 2009 2010 2011 Alabama $220,312,552 tºº -- Alaska 24,222,067 sº *** , Arizona 260,873,138 ** ** Arkansas 163,837,457 ** ** California 319,387,998 º, ** Colorado 121,763,455 ** ** Connecticut 42,219,513 ** wº. Delaware 42,418,002 **t gº Florida 369,866,089 ** *sº Georgia 322,645,299 *** *** Hawaii 44,096,434 *** *& Idaho 154,263,970. **ºr ** Iilinois . 298,769,213 ** ** Indiana i45,986,097 * ** Iowa 62,285,462 *º ** Kansas 136,241,839 ** ** Kentucky 193,653,644 sº. 4-fºr Louisiana 200,507,182 *gº: * * Maine 138,684,400 ຠº *** Maryland 158,417,922 ** ** Massachusetts 73,166,723 *-ºf ** Michigan 419,682,899 * * ** Minnesota 279,561,054 ** tºº Mississippi 114,558,713 sº º Missouri 244,665,674 º: 4, at Montana 92,108,971 ** *** Nebraska 45,872,854 *sº ** Nevada 40,928,970 ** ** New Hampshire 79,748,655 *** ** New Jersey 69,049,705 fºº sº New Mexico 20,069,273 ** ** New York 109,949,590 ** * * North Carolina 591,273,710 -- ** North Dakota 25,251,84; ºgº. * {\hio 287,253,337 ** ** {}klahoma 194,191,359 *a* *ºr Oregon 237,725,402 ** tºº Pennsylvania 276,976,844 **º *g, * Rhode Island 12,155,270 **. sº tº South Carolina 237,932,733 st tº $ºº. South Dakota 81,301,089 sº ** Tennessee 278,139,462 ** * Texas 410,215,434 xerº, & Rºº. Utah 206,743,350 *** ** Vermont 27,786,651 *** -- Virginia 301,666,774 **. ** Washington 263,072,005 tº ºr ** West Virginia 115,892,527 ** gºº Wisconsin 213,146,333 * * ** Wyoming 84,363,114 *** -- Puerto Rico 179,942,056 *ēt. ºëºt. Virgin Islands 472,000 ** ** W. Pacific Areas 3,695,798 * ** Totai Avail.jFst. $9,039,510,700 $1,671,449,239 II ** 379 27-40 RüRAL HOUSING SERVICE Arizona Arkansas California Florida Hawaii Iłłinois Iowa Kansas Kentucky Maine Massachusetts Michigan Minnesota Mississippi Missouri Montana Nebraska New Hampshire New Jersey New York North Carolina North Dakota Ohio Oklahoma Pennsylvania Rhode island South Dakota Tennessee Texas Utah Vermont Virginia Wisconsin Wyoming Total Awaii.fest, GEOGRAPHIC BREAKDOWN OF OBLIGATIONS 2009 Actual and Estimated 2010 and 201 i Rural Rental Housing Direct Loans 2009 $53,255 1,000,000 4,000,000 7,039,045 1,000,000 349,635 685,009 1,321,400 909,310 4,974,550 1,443,605 4,390,265 814,225 1,396,509 1,305,210 754,900 744,779 3,661,000 936,986 1,188,042 10,305,000 1,896,200 3,878,477 1,527,732 959,195 624,605 999,799 639,552 749,799. 950,000 3,067,700 355,000 2,503,525 1,114,083. $67,338,393 iſ Cannot be distributed by geographic area in advance. ** $35,236,000 u 380 27-41 RURAL HOUSING SERVICE GEOGRAPHIC BREAKDOWN OF OBLIGATIONS 2009 Actual and Estimated 2010 and 2011 Rural Rental Housing Direct Loans 2007 Tornados Disasters 2009 2010 2011 Total Avail./Est. sº sº. $1,402,919 1/ **** l/ Cannot be distributed by geographic area in advance. 381 Alaska Arizona Arkansas California Connecticut Georgia Idaho Illinois Indiana Kentucky Maryland Minnesota North Dakota Ohio $. Pennsylvania South Carolina Tennessee Texas Utah Vermont Virginia Wisconsin Total Avail.jFst. Total Avail.jpst. 27-42 RURAL, HOUSING SERVICE GEOGRAPHICBREAKDOWN OF OBLIGATIONS 2009 Actual and Estimated 2010 and 2011 Multi Family Housing Guaranteed Loans 2009 $3,950,000 4,313,571 1,518,000 53,224,343 4, 179,250 5,268,982 1,345,000 6,210,000 1,010,000 475,000 3,589,000 1,316,074 1,900,000 12,999,700 3,000,000 1,810,000 i,799,386 8,535,225 750,000 300,000 2,526,300 832,000 $120,851,801 $129,130,435 iſ 2010 **** * * * * * * Multi Family Housing Guaranteed Loans - No Year 2009. *** _312,339,319.4 2010 2011 ***** iſ Cannot be distributed by geographic area in advance, $129,133,000 =:::::::::::::::::: 1ſ 382 27-43 RURAL, HOUSING SERVICE GEOGRAPHIC BREAKDOWN OF OBEIGATIONS 2009 Actual and Estimated 2010 and 2011 Multi Family Housing Guaranteed Loans 2008 Disasters 2009 2010 Idaho 1,120,000 *user Illinois 2,400,700 ** Iowa 2,356,600 3ºE ºf Louisiana 1,398,788 tºº. Oklahoma 4,285,000 *** Texas 101,675 $ tº: $6,178,000 1/ Total Avail./Est. $11,662,763 -ºr-- Cannot be distributed by geographic area in advance, 383 Alabama Alaska Arizona Arkansas California Colorado Connecticut Delaware Fiorida Georgia Hawaii Idaho Illinois Indiana Iowa Kansas Kentucky iouisiana Maine Maryland Massachusetts Michigan Minnesota Mississippi Missouri Montana Nebraska Nevada New Hampshire New Jersey New Mexico New York North Carolina North Dakota Ohio Cºkiahoma Oregon Pennsylvania Rhode Island South Carolina South Dakota Tennessee Texas Utah Vermont Virginia Washington West Virginia Wisconsin Wyoming Puerto Rico Western Pacific Virgin Islands Undistributed Total Avail./Est. 27-44 RÚRAL HOUSING SERVICE GEOGRAPHIC BREAKDOWN OF OBLIGATIONS 2009 Actual and Estimated 2010 and 2011 Very low-Income Housing Repair Loans 2009 2010 2011 $744,272 $947,000 $910,000 78,230 298,000 291,000 151,893 683,000 676,000 519,315 724,000 717,000 69,946 1,688,000 1,681,000 17,305 392,000 385,000 66,702 95,000 88,000 9i,786 82,000 75,000 785,981 901,000 894,000 1,157,103 1,218,000 1,216,000 319,213 288,000 281,000 129,727 292,000 285,000 1,923,840 720,000 712,000 598,460 680,000 672,000 1,094,032 471,000 463,000 210,680 394,000 386,000 1,692,265 849,000 841,000 674,278 837,000 829,000 587,485 316,000 308,000 #83,229 254,000 246,000 136,409 147,000 $40,000 995,890 955,000 947,000 709,533 705,000 697,000 876,446 927,000 919,000 1,631,799 833,000 825,000 22,459 235,000 228,000 i38,461 280,000 272,000 44,894 123,000 115,000 246,915 168,000 160,000 17,750 127,000 119,000 100,199 543,000 $35,000 $34,298 889,000 881,000 2,176,069 1,574,000 1,563,000 154,755 140,000 132,000 633,063 951,000 943,000 182,246 656,000 648,000 192,863 551,000 543,000 1,018,126 f,193,000 1,095,000 38,245 19,000 12,000 575,955 856,000 848,000 192,469 229,000 222,000 940,760 904,000 897,000 692,823 2,717,000 2,709,000 245,399 170,000 163,000 198,449 156,000 149,000 638,822 772,000 764,000 324,530 666,000 658,000 682,950 464,000 454,000 648,892 723,000 715,000 17,509 125,000 i 18,000 230,797 429,000 422,000 1,083,817 500,000 493,000 21,659 110,000 103,000 * - 2,572,451 2,565,000 $26,813,693 $34,412,451 $34,094,000 384 27-45 RURAL HOUSING SERVICE GEOGRAPHICBREAKDOWN OF OBLIGATIONS 2009 Actual and Estimated 2010 and 2011 Very Low-Income Housing Repair Loans for Natural Disaster 2009 2010 Missouri $2,810 tº º Totai Avail./Est. $2,810 $6,872,393 1/ Very Low-Income Housing Repair Loans 2003/2004 Hurricanes for Natural Disaster 2009 2010 Total Avail/Est. -- $33,585,336 11 Very Low-Income Housing Repair Loans 2005 Hurricanes for Natural Disaster 2009 2010 Louisiana $162,913 -- Mississippi 43,094 tºº Texas 1,570 ºr- Total Avail./Est. - $207,577 - $857,078 1/ Very Low-Income Housing Repair Loans 2007 Tornados Disasters 2009 2010 - Total Avail./Est. tº ºr $119,424 1/ -º-º: :- 1/ Cannot be distributed by geographic area in advance. 2 1. 1 ** 2 ! | 2 1 | 385 Total Avail./Est. Georgia Kansas North Carolina Total Avail./Est. Total Awaii./Est. California Idaho Maine Minnesota Missouri New York Oregon Washington Puerto Rico Total Avail./Est. Michigan Total Avail./Est. 27-46 RURAL HOUSING SERVICE GEOGRAPHICBREAKDOWN OF OBLIGATIONS 2009 Actual and Estimated 2040 and 2011 Farm Labor Housing Loans for Natural Disaster 2009. 2010 _$1,482,863.1/ Housing Site Development Direct Loans 2009 $294,000 $27,500 277,690 $599,190 Self Help Housing Land Development Loans 2009 --> Sºº-º-º:- - tºvº _$5,045,000.1/ 2010 -vº- $4,970,000 f/ Single Family Housing Credit Sales 2009 $385,500 118,102 98,784 55,000 59,375 47,215 148,200 57,000 62,720 —-º- _$1,031,896. 2010 -*-* ** ** ** ** $10,000,000 l/ Multiple Family Housing Credit Sales 2009 $1,447,951 $1,447,951 2010 ** TSTAT371. Cannot be distributed by geographic area in advance. $4,966,000 iſ 2011 $5,052,000 l/ 2011 *- $10,000,000 1/ 2011 - -- _$1,449,000 l/ 386 27–47 RURAL HOUSING SERVICE RURAL HOUSING INSURANCE FUND Classification by Objects 2009 Actual and Estimated 2010 and 2011 FY 2009 FY 2010 FY 2011 Other Objects: 25 Other purchases of goods and - Services from government accounts... $467,597,000 $471,261,000 $454,383,00 41 Grants, subsidies, and contributions...... 346.748,860 361,640,197 - 127,331.00 Total direct obligations............................., $14,345,860 – $32,901,197 581,714.00 387 27-48 RURALHOUSING SERVICE The estimates include appropriation language for this item as follows (new language underscored; deleted matter enclosed in brackets): - Farm Labor Program Account For the cost of direct loans, grants, and contracts, as authorized by 42 U.S.C. 1484 and 1486, {$19,746,000]320,346,000, to remain available until expended, for direct farm labor housing loans and domestic farm labor housing grants and contracts. 388 27-49 RURAL, HOUSING SERVICE Analysis of Change in Appropriation FARM LABOR PROGRAMACCOUNT (On basis of loan levels, subsidies, and grants) - - Loan Level Subsidy Grants Appropriations Act, 2010 ........... $27,318,760 $9,873,000 $9,873,000 Budget Estimate, 2011 27,287,650 10,473,000 9,873,000 Increase or decreases in Appropriations............. –31,110 600,000 () § PROJECT STATEMENT (On basis of appropriated/supportable loan level, subsidy, and grants) (In thousands of dollars) 2009 Actual 2010 Estimated Increase or Decrease 2011 Estimated Program Subsidy/ Program Subsidy/ Program Subsidy/ Program Subsidy/ Item of Change Level BA Level BA Level - BA Level BA Direct farm labor housing loans..................... : $34,530 $14,551 $27,319 $9,873 -$31 (1) $600 (2) $27,288 $10,473 Domestic farm labor housing grants................. 14,955 14,955 9,873 9,873 0 0. 9,873 9,873 Total Available or Estimate.......................... 49,485 29,506 37,192 19,746 -31 600 37,161|| 20,346 Recovery of prior year obligations................... –3,901 -656 () 0 {} 0 0 0 Unobligated balance, start of year................... -16,795 -1 1,312 () () 0 0 0 0 Unobligated balance, end of year.................... 2,022 731 0. {) 0. 0 () 0 Total Appropriation................................... 30,812 18,269 37,192 19,746 -31 600 37,161 20,346 Staff Years are reflected in the Salaries and Expenses Project Statement. PROJECT STATEMENT (On basis of obligations under available funds) (In thousands of dollars) 2009 Actual 2010 Estimated Increase or Decrease 2011 Estimated - Program Subsidy/ Program Subsidy/ Program Subsidy/ Program Subsidy/ Item of Change Level BA Level BA Level BA Level BA Direct farm labor housing loans...................... $34,530 $14,551 $29,341 $10,604 -$2,053 -$131 $27,288 $10,473 , Domestic farm labor housing grants................ 14,955 14,955 9,873 9,873 0 0 9,873 9,873 Total Available or Estimate.......................... 49,485 29,506 39,214 20,477 -2,053 -131 37,161 20,346 Recovery of prior year obligations.................. -3,901 -656 0 0 O 0 - 0 0 Unobligated balance, start of year................... -16,795 -11,312 –2,022 -731 1,734 731 0 0 Unobligated balance, end of year..................... 2,022 731 () {} 0 () 0 0 Total Appropriation............… - 30,812 18,269 37,192 19,746 –319 600 37,161 20,346 Staff Years are reflected in the Salaries and Expenses Project Statement. : 390 27-51 JUSTIFICATION OF INCREASE AND DECREASES (1) A decrease of $31,000 in direct farm labor housing loans program $27 319,000 available in 2010). The decrease is due to the annual technical assumption changes that increased the subsidy rate from 38.14 percent to 38,38 percent and increased the budget authority by $600,000. (2) An increase of $600,000 in the direct farm labor housing loan subsidy ($9,873,000 available in 2010) The requested increase in subsidy amount supports the estimated loan obligations associated with the requested FY 2011 loan levels for the direct farm labor housing loan program. There was a ten percent increase in loans provided in 2009 compared to that in 2008 and is indicative of the success o the program. This funding increase will help meet the anticipated increase in loan applications for 2011. - 391 27-52 RURAL, HOUSING SERVICE GEOGRAPHIC BREAKDOWN OF OBLIGATIONS 2009 Actual and Estimated 2010 and 2011 Farm Labor Housing Loans 2009 2010 2011 Alaska $93,602 ** -* Arkansas & 1,067,000 ** &: California 26,912,156 x= gº wn wº Florida 300,000 -- * * Hawaii 561,428 -- gºº Iowa 541,000 *Rºº. ** Kansas 500,000 ** **º Michigan 560,187 -- *** Mississippi - 132,000 * ºr www. Nevada 31,171 . ** wºsº. Texas 2,635,655 + ** *st Vermont 233,000 * * ** Washington 300,000 ** smºs Wisconsin & 662,470 - ** * ** Total Avail./Est, $34,529,669 $29,340,833 1/ $27,288,000 1/ Farm Labor Housing Grants 2009 2010 2011 California $3,400,000 **** wººl Florida 2,700,000 **** ** Kansas 2,500,000 * * nº º Mississippi 1,190,700 & -- * * Texas t 2,586,430 *** * ** Washington 2,578,310 . - . — Total Avail./Est. $14,955,440 $9,873,000 l/ $9,873,000 1/ l/ Cannot be distributed by geographic area in advance. 392 27–53 RURAL, HOUSING SERVICE FARMLABOR PROGRAMACCOUNT Classification by Objects 2009 Actual and Estimated 2010 and 2011 FY 2009 FY 2010 FY 2011 Other Objects: 41 Grants, subsidies, and contributions.......... $29,506,242 $20,476,777 $20,346,000 Total direct obligations * 29,506,242 20,476,777 20,346,000 393 27-54 RURAL HOUSING SERVICE The estimates include appropriation language for this item as follows (new language underscored; deleted natter enclosed in brackets): Multi-family Housing Revitalization Program. Account For the rural housing voucher program as authorized under section 542 of the Housing Act of 1949, but notwithstanding subsection (b) of such section, [for the cost to conduct a housing demonstration program to provide revolving loans for the preservation of low-income multi-family housing projects, and for additional costs to conduct a demonstration program for the preservation and revitalization of multi-family rental housing properties described in this paragraph, $43,191,000] $18,000,000, to remain available until expended: Provided, That of the funds made available under this heading, $16,400,000], which shall be available for rural housing vouchers to any low- income household (including those not receiving rental assistance) residing in a property financed with a section 515 loan which has been prepaid after September 30, 2005: Provided [further], That the amount of such voucher shall be the difference between comparable market rent for the section 515 unit and the tenant paid rent for such unit: Provided further, That funds made available for such vouchers, shall be subject to the availability of annual appropriations: Provided further, That the Secretary shall, to the maximum extent practicable, administer such vouchers with current regulations and administrative guidance applicable for section 8 housing vouchers administered by the Secretary of the Department of Housing and Urban Developmentſ: Provided further, That if the Secretary determines that the amount made available for vouchers in this or any other Act is not needed for vouchers, the Secretary may use such funds for the demonstration programs for the preservation and revitalization of multi-family rental housing properties described in this paragraph: Provided further, That of the funds made available under this heading, $1,791,000 shall be available for the cost of loans to private non-profit organizations, or such non-profit organizations’ affiliate loan funds and State and local housing finance agencies, to carry out a housing demonstration program to provide revolving loans for the preservation of low-income multi-family housing projects: Provided further, That loans under such demonstration program shall have an interest rate of not more than 1 percent direct loan to the recipient: Provided further, That the Secretary may defer the interest and principal payment to the Rural Housing Service for up to 3 years and the term of such loans shall not exceed 30 years: Provided further, That of the funds made available under this heading, $25,000,000 shall be available for a demonstration program for the preservation and revitalization of the section 514, 515, and 516 multi-family rental housing properties to restructure existing USDA multi-family housing loans, as the Secretary deems appropriate, expressly for the purposes of ensuring the project has sufficient resources to preserve the project for the purpose of providing safe and affordable housing for low-income residents and farm laborers including reducing or eliminating interest; deferring loan payments, subordinating, reducing or reamortizing loan debt; and other financial assistance including advances and incentives (including the ability of owners to obtain reasonable returns on investment) required by the Secretary: Provided further, That the Secretary shall as part of the preservation and revitalization agreement obtain a restrictive use agreement consistent with the terms of the restructuring: Provided further, That if the Secretary determines that additional funds for vouchers described in this paragraph are needed, funds for the preservation and revitalization demonstration program may be used for such vouchers: Provided further, That if Congress enacts legislation to permanently authorize a multi-family rental housing loan restructuring program similar to the demonstration program described herein, the Secretary may use funds made available for the demonstration program under this heading to carry out such legislation with the prior approval of the Committees on Appropriations for both Houses of Congress: Provided further, That in addition to any other available funds, the Secretary may expend not more than $1,000,000 total, from the program funds made available under this heading, for administrative expenses for activities funded under this heading]. e first change eliminates the funding for the multi-family housing revitalization program with the rural using voucher program being the only program funded in this account. 394 27-55 The second change removes the designation for a set amount of funds for the voucher program as the account now only contains voucher funding. - The third change adds the word “which” in the paragraph. The fourth change deletes the word “further” in the paragraph. The fifth change removes the language allowing the Secretary of Agriculture to move unobligated vouch funding into the multi-family housing revitalization program as the multi-family housing revitalization program is not funded in FY 2011. 395 27-56 RURAL, HOUSING SERVICE Analysis of Change in Appropriation MULTI-FAMILY HOUSING REVITALIZATION PROGRAM ACCOUNT (On basis of loan levels, subsidies, and grants) Loan Level Subsidy Grants Appropriations Act, 2010............ ~~~~ $44,106,649 $18,791,000 $54,400,000 Budget Estimate, 2011 ........................................- - 0. O 18,000,000 Decrease in Appropriation.................................... -44,106,649 -18,791,000 -6,400,000 § PROJECT STATEMENT - T LAW (On basis of supportable loan level and appropriated subsidy and grants) (In thousands of dollars) 2009 Actual 2010 Estimated Increase or Decrease 2011 Estimated Program Subsidy/ Program Subsidy/ Program Subsidy/ Program Subsidy/ Level BA Level BA Level BA Level BA Rural housing voucher program and administrative expenses.... $8,958 $8,958 $16,400 $16,400 $1,600 $1,600 (2) $18,000 $18,000 Multi-family housing revitalization modifications (Sec.515)..... 0 6,361 0 0 0 O 0. 0 Multi-family housing revitalization zero percent (Sec.515)...... 14,502 8,787 30,136 11,500 -30,136 (1) -11,500 (3) 0. 0 Multi-family housing revitalization soft seconds (Sec. 515)...... 4,677 3,999 7,549 5,500 -7,549 (1) –5,500 (3) 0 0 Multi-family housing revitalization grants (Sec. 515)............... 161 161 8,000 8,000 -8,000 (1) -8,000 (3) 0 0 Multi-family housing preservation demo revolving loan fund.... 6,422 2,888 6,422 1,791 -6,422 (1) -1,791 (3) 0. 0 Total Available or Estimate............................................ 34,721 31,155 68,507 43,191 -50,507 -25,191 18,000 18,000 Total administrative expenses - 2008 disasters aſ................... 0 240 O 0 0 0 0 {} Recovery of prior year obligations.................................... –7,444 -1,265 0 0 0 () 0 () Unobligated balance start of year...................................... –20,359 -15,373 0 0 . 0 0. 0 0 Transfer of unobligated balance aſ.................................... –6,918 -8,000 0 0 0 0 () 0 Unobligated balance end of year....................................... 32,021 20,957 0 0 () O Q 0 . Total Appropriation...................................................., 32,022 27,714 68,507 43,191}_-50,507 -25,191 18,000 18,000 Staff years are reflected in the Salaries and Expenses Project Statement. a/Transfer $8 million from the Rural Development Disaster Assistance Fund provided by the Consolidated Security, Disaster Assistance, and Continuing Appropriations Act, 2009, P.L. 110-329, dated September 30, 2008, Division B, which provides additional amounts for authorized activities of a affected by a disaster declared by the President or the Secretary of Agriculture. gencies of the Rural Development Mission Area in areas : § (On basis of available supportable loan level, subsidy, and grants) PROJECT STATEMENT - CURRENT LAW 0 (In thousands of dollars) 2009 Actual 2010 Estimated Increase or Decrease 2011 Estimated Program Subsidy/ Program Subsidy/ Program Subsidy/ Program Subsidy/ Level BA Level BA Level BA Level BA Rural housing voucher program and administrative expenses.... $8,958 $8,958 $24,630, $24,630 -$6,630 -$6,630 $18,000 $18,000 Rural housing voucher program 2008 disasters emer. Supp aſ... {} 0 1,940 1,940 -1,940 -1,940 {} Multi-family housing revitalization modifications (Sec.515)..... {} 6,361 0 0 0 0 {} 0 Multi-family housing revitalization modifications (Sec.515) 2008 disasters emergency Supplemental aſ....................... 0 0 Q 1,949 {} -1,949 {} 0 Multi-family housing revitalization zero percent (Sec.515)...... 14,502 8,787 30,961 11,815 -30,961 -11,815 0. O Multi-family housing revitalization zero percent (Sec.515) * . 2008 disasters emergency supplemental aſ....................... {} 0 2,606 994 –2,606 –994 0 Ö Multi-family housing revitalization soft seconds (Sec. 515)...... 4,677 3,999 8,392 6,114 -8,392 -6,114 {} () Multi-family housing revitalization soft seconds (Sec. 515) - 2008 disasters emergency supplemental aſ...................... ſ {} {} 3,728 2,717 –3,728 -2,717 {} 0. Multi-family housing revitalization grants (Sec. 515)............... 161 161 8,000 8,000 -8,000 -8,000 () 0 Multi-family housing revitalization grants (Sec. 515) - - 2008 disasters emergency supplemental aſ....................... 0. () 160 160 -160 -160 Ö {} Multi-family housing preservation demo revolving loan fund...: 6,422 2,888 20,899 5,829 -20,899 –5,829. 0. 0 Total Available or Estimate............................................ 34,721 31,155 101,316 64,148 -83,316 -46,148 18,000 18,000 Total administrative expenses - 2008 disasters aſ................... {} 240 0 0 0. {} {} () Recovery of prior year obligations.................................... –7,444 -1,265 {} () 0 {} 0 {} Unobligated balance start of year...................................... –20,359 -15,373 -32,809 –20,957 32,809 20,957 () 0 Transfer of unobligated balance aſ.................................... -6,918 –8,000 {} 0 0 () {} 0 Unobligated balance end of year....................................... 32,021 20,957 O () {} 0 {} {) Total Appropriation..................................................... 32,022 27,714 68,508 43,191 -50,507 -25,191 18,000 18,000 Staff years are reflected in the Salaries and Expenses Project Statement. aſ Transfer $7,760,000 from the Rural Development Disaster Assistance Fund provided by the Consolidated Security, Disaster Assistance, and Continuing Appropriations Act, 2009, P.L. 110-329, dated September 30, 2008, Division B, which provides additional amounts for authorized activities of agencies of the Rural Development Mission Area in areas affected by a disaster declared by the President or the Secretary of Agriculture. : 398 (1) (2) (3) monthly payments in rent assistance to eligible tenants, subject to annual appropriations. 27-59 JUSTIFICATION OF INCREASE AND DECREASES A decrease of $52,107,000 in the multi-family housing preservation loan programs ($52,107,000 available in 2010). - - For the multi-family housing programs, the 2011 Budget for USDA’s rural housing service focuses assistance on the low and very-low tenant population. While repair and rehabilitation of the portfoli is important, funding through an open ended demonstration program has been carried out since 2006 and the most cost-effective and justified repairs have been achieved. At this point, additional fundin in the demonstration program could be seen as over-subsidizing the multi-family housing property owners. Meanwhile, the traditional way to fund revitalization has been through the multi-family housing direct loan program with rehabilitation loans, While the 2011 Budget proposes to terminate funding for the multi-family housing revitalization demonstration program, it proposes to increase th multi-family housing direct loan program from $70 million to $95 million, ensuring that more affordable rental housing opportunities are created for the very-low income tenant base in rural America. An increase of $1,600,000 in the multi-family housing preservation vouchers program ($16,400,000 available in 2010). The increase in the multi-family housing preservation vouchers program will allow for the issuance and annual renewal of rural development vouchers to tenants in prepaid and foreclosed multi-family properties. The rural development vouchers program is designed to provide a maximum of 36 Approximately 500 additional tenants are expected to receive vouchers from the funding increase. A decrease of $26,791,000 in subsidy for the multi-family housin revitalization loan program ($26,791,000 available in 2010). - - - - The decrease is due to the termination of funding for the multi-family programs as mentioned above 399 27–60 RURAL, HOUSING SERVICE GEOGRAPHICBREAKDOWN OF OBLIGATIONS 2009 Actual and Estimated 2010 and 2011 Multi-Family Housing Revitalization Zero Percent Loans 2008 Disasters 2009 2010 2011 Total Avail./Est. ** $2,605,985 1/ tºº. Multi-Family Housing Revitalization Soft Second Loans 2008 Disasters 2009 2010 2011 Total Avail./Est. - -- $3,728,396 1/ ** 1/ Cannot be distributed by geographic area in advance. 400 27-61 RURAL HOUSING SERVICE GEOGRAPHIC BREAKDOWN OF OBLIGATIONS 2009 Actual and Estimated 2010 and 2011 Multi-Family Housing Revitalization Zero Percent Loans 2009 2010 2011. Kansas $627,902 ** -- Maine 176,500 * - * “ge Michigan 53,000 --- -- Missouri 648,704 - - * Mºſt Nebraska 290,244 -wº- - - Ohio 415,000 -- ºw ºw South Carolina 12,291,011 * - -- Totai Avail.JPst. $14,502,361 $30,961,049 iſ - ** Multi-Family Housing Revitalization Soft Second Loans 2009 2010 2011 Connecticut $89,601 ** ** Florida 950,284 *-- -- Georgia 97,039 * * --- Kansas 222,500 - - dº Kentucky 72,306 --- -- Maine 476,033 -- -- Minnesota 118,100 --> wº º Missouri 319,770 *-- ** Nebraska 333,689 W ºn www. New Hampshire 388,000 - -- New York - 95,500 *- -- North Carolina 347,110 - - **r North Dakota 90,853 ** -- South Dakota 135,346 * - * * Virginia 385,000 ** --- Wisconsin 553,395 ** --- Wyoming 2,635 -- ----...-- *-º-º: Total Avail./Est. $4,677,161 $8,391,936 l/ -- 1/ Cannot be distributed by geographic area in advance. 401 27-62 RURAL HOUSING SERVICE GEOGRAPHICBREAKDOWN OF OBLIGATIONS 2009 Actual and Estimated 2010 and 2011 Multi-Family Housing Revitalization Grants 2009 2010 2011 Illinois $46,565 **t dº gº Kansas - 23,419 ** ºg ºf Maine 41,500 - - * * Missouri 24,719 ** . vº-ase North Dakota 25,000 - tº aº , Total Avail./Est. $161,203 $8,000,000 1/ tº ºs Multi-Family Housing Preservation Demonstration Loan Fund 2009 2010 2011 Wisconsin $2,125,000 ** *** Maryland 2,296,642 **. **** New Mexico 2,000,000 *** * * Total Avail./Est. $6,421,642 $20,898,604 1/ sººn Cannot be distributed by geographic area in advance. 402 27-63 RURAL HOUSING SERVICE GEOGRAPHIC BREAKDOWN OF OBLIGATIONS 2009 Actual and Estimated 2010 and 2011 Multi-Family Housing Revitalization Grants 2008 Disasters 2009 2010 2011 Total Avail./Est, $159,711 1/ $ºtº 1/ Cannot be distributed by geographic area in advance. 403 27-64 RURAL, HOUSING SERVICE GEOGRAPHICBREAKDOWN OF OBLIGATIONS 2009 Actual and Estimated 2010 and 2011 Rural Housing Voucher Program 2009 2010 2011 Alabama $88,764 sº tº * -- Alaska H56,233 ** **- Arizona 7,713 * * tºº California 23,532 **e ** Colorado 24,120 ** agº Florida 1,160,064 &º tºº Georgia 409,548 * * * ** Idaho 153,132 *-* ** Hlinois 223,244 * ºn sº-ºº: Indiana 13,710 tº º *4- Iowa 543,045 — tº ºr Kentucky 24,216 ** **g Louisiana 8,670 * * ** Maine 50,592 sage ... • * Maryland 8,100 *** | -- Michigan 62,610 ** ** Minnesota 204,203 * ** Missouri 402,638 ** ** Montana 42,368 ** tº tº Nebraska 22,752 ** * New Hampshire 96,168 ** ** New Jersey 344,858 . ** * *se gº New Mexico 266,928 agº ** New York 322,423 -- tº tº North Carolina 133,618 º sº North Dakota 160,742 **. tºº Ohio 128,567 ** * * Oklahoma 5,184 ** º Oregon 116,246 *4 tº *sº Pennsylvania 26,016 ** sº South Carolina 267,918 •º ** South Dakota 41,878 * ** Tennessee 155,598 º *-*. Texas 399,911 ** *tº Utah 36,267 ** ** Virginia 4,080 *-* ** Washington - 51,900 sº tº ** Wisconsin 240,193 gºº * Wyoming . 5,700 sº &º Puerto Rico 4,800 see - . Total Avail./Est. $6,438,249 $24,630,316 1/ $18,000,000 l/ Rural Housing Vouchers - Administrative Expenses 2009 2010 2011 • Total Awaii.f5St. $2,520,000 gº tºvº Il Cannot be distributed by geographic area in advance. 404 27-65 RURAL HOUSING SERVICE GEOGRAPHICBREAKDOWN OF OBLIGATIONS 2009 Actual and Estimated 2010 and 2011 Rural Housing Vouchers 2008 Disasters 2009 201 *º-ººººººººººººt tºº Total Avail./Est. - tº ºn $1,940,000 l/ * * * 0 2 1 || 1/ Cannot be distributed by geographic area in advance. 405 RURAL HOUSING SERVICE MULTI-FAMILY HOUSING REVITALIZATION PROGRAMACCOUNT 27-66 Classification by Objects 2009 Actual and Estimated 2010 and 2011 Other Objects: 25 Other purchases of goods and services from government accounts....... 4} Grants, subsidies, and contributions Total direct obligations * * * * * * > * $ 4 e º e º e º & tº tº FY 2011 FY 2009 FY 2010 $2,760,000 $0 $0 28,635,352 64,148,037 18,000,000 31,395,352 64,148,037 18,000,000 406 27-67 RURAL HOUSING SERVICE The estimates include appropriation language for this item as follows (new language underscored; deleted matter enclosed in brackets): Rental Assistance Program For rental assistance agreements entered into or renewed pursuant to the authority under section 521(a)(2) or agreements entered into in lieu of debt forgiveness or payments for eligible households as authorized by section 502(c)(5)(D) of the Housing Act of 1949, [$980,000,000; $965,635,000; and, in addition, such sums as may be necessary, as authorized by section 521(c) of the Act, to liquidate debt incurred prior to fiscal year 1992 to carry out the rental assistance program under section I 521(a)(2) of the Act: Provided, That [of this amount, up to $5,958,000 may be available for debt forgiveness or payments for eligible households as authorized by section 502(c)(5)(D) of the Act, and not to exceed $50,000 per project for advances to nonprofit organizations or public agencies to cover direct costs (other than purchase price) incurred in purchasing projects pursuant to section 502(c)(5)(C) of the Act: Provided further, That] of this amount not less than [$2,030,000183,000,000 is available for newly constructed units financed by section 515 of the Housing Act of 1949, and not less that [$3,400,000]$3,000,000 is for newly constructed units financed under sections 514 and 516 of the Housing Act of 1949: Provided further, That rental assistance agreements entered into or renewed during the current fiscal year shall be funded for a one-year period: Provided further, That any unexpended balances remaining at the end of such one- year agreements may be transferred and used for the purposes of any debt reduction; maintenance, repair, or rehabilitation of any existing projects; preservation; and rental assistance activities - authorized under title V of the Act: Provided further, That rental assistance provided under 2 agreements entered into prior to fiscal year 2010]2011 for a farm labor multi-family housing project financed under section 514 or 516 of the Act may not be recaptured for use in another project until such assistance has remained unused for a period of 12 consecutive months, if such project has a waiting list of tenants seeking such assistance or the project has rental assistance eligible tenants who are not receiving such assistance: Provided further, That such recaptured rental assistance shall, to the extent practicable, be applied to another farm labor multi-family housing project financed under section 514 or 516 of the Act. - The first change eliminates funding availability for the debt forgiveness program. The second change modifies the fiscal year from 2010 to 2011. 407 27-68 RURAL HOUSING SERVICE Analysis of Change in Appropriation RENTAL ASSISTANCE PROGRAM Appropriations Act, 2010.......................................................................... $980,000,000 Budget Estimate, 2011............................................................................... 965,635,000 Decrease in Appropriation........................................................ ** * * * * * * s is ºf a * * * * * * -14,365,000 408 27-69 PROJECT STATEMENT (On basis of appropriation) (In thousands of dollars) 2009 2010 Increase or 2011 Item of Change Actual Estimated Decrease Estimated Rental assistance (Sec 521).....................: $0 $968,612 -$8,977 $959,635 Rental assistance 2009/2010 (sec. 521)....... 896,674 0. 0 {} Rental assistance - new construction (Sec. 515) ........................ 2,028 2,030 970 3,000 Rental assistance - new - construction (Sec. 514/516) ................... 3,370 3,400 400 3,000 Rental assistance (Sec. 502)..................... 150 5,958 -5,958 0 Total Available or Estimate..................... 902,222 980,000 -14,365 (1) 965,635 Unobligated balance, start of year ............. 0. {} {} Unobligated balance, end of year............: | 278 0 0 0 Total Appropriation.............................. 902,500 980,000 -14,365 965,635 Staff years are reflected in the Salaries and Expenses Project Statement. • - PROJECT STATEMENT (On basis of available/supportable loan levels, subsidies, and grants) (In thousands of dollars) - 2009 2010 Increase or 2013 Item of Change Actual Estimated Decrease Estimated Rental assistance (Sec 521)..................... l $0 $968,890 -$9,255 $959,635 Rental assistance 2009/2010 (sec. 521)....... 896,674 0 {} () Rental assistance - new construction (sec. 515)........................ 2,028 2,030 970 3,000 Rental assistance - new construction (Sec. 514/516) ................... 3,370 3,400 -400 3,000 Rental assistance Emergency Suppl......... {} 0 {} 0 Rental assistance (Sec. 502)..................... i 50 5,958 -5,958 () Total Available or Estimate..................... 902,222 980,278 -14,643 965,635 Unobligated balance, start of year ............ l {} -278 278 {} Unobligated balance, end of year.............. 278 - 0 {} 0 Total Appropriation.............................. 902,500 980,000 -14,365 965,635 Staff years are reflected in the Salaries and Expenses Project Statement, 409 (1) 27-70 JUSTHFICATION OF DECREASE A decrease of $14,365,000 in section 521 rental assistance ($980,000,000 available in 2010). The decreased level requested reflects the increase precision to predict rental assistance costs. Based upon available historical data on renewals and inflation assumptions, Rural Development has refined its ability to estimate annual rental assistance needs. The amount requested is the amount rural housing service needs to renew all outstanding contracts and should be sufficient to meet the agency needs even at this reduced level. With this funding, the agency would be able to renew 212,000 units. - 410 j/ Alabama Alaska Arizona Arkansas California Colorado Connecticut Delaware Florida Georgia Hawaii Idaho Iliinois Indiana Iowa Kansas Kentucky flouisiana Maine Maryland Massachusetts Michigan Minnesota Mississippi Missouri Montana Nebraska Nevada New Hampshire New Jersey New Mexico New York North Carolina North Dakota Ohio Oklahoma Oregon Pennsylvania Rhode Island South Carolina South Dakota Tennessee Texas Utah Vermont Virginia Washington West Virginia Wisconsin Wyoming Puerto Rico Virgin Islands Total Awaii./Est. 27-71 RüRAL, HOUSING SERVICE GEOGRAPHC BREAKDOWN OF OBLIGATIONS 2009 Actual and Estimated 2010 and 201 i Rural Rental Assistance Programs 2009 $25,749,216 3,197,448 12,766,236 20,811,039 55,257,724 8,405,032 7,416,672 6,320,800 42,511,210 24,#39,272 4,969,668 li,402,676 22,465,080 14,872,511 17,498,536 9,339,601 17,998,848 39,298,080 30,472,240 15,090,816 9,917,980 28,013,420 18,105,119 37,468,380 18,930,024 5,146,548 6,297,588 7,610,400 10,848,968 6,705,600 11,468,184 18,222,372 41,568,440 4,453,956 23,083,968 17,341,921 15,233,328 22,386,780 938,616 22,356,516 20,410,672 21,864,672 38,670,524 6,683,904 8,112,996 20,948,760 19,423,556 10,428,264 $5,414,320 4,256,496 i.7,183,544 5,603,796 $902,222,317 Cannot be distributed by geographic area in advance. 2010. 2011 ººm- ** ** ** º-ºº: * ** ** * *—& ** *º ** ** 4-º-º: *-º: - * ** ** dº wº * º * sº wºrms sº ** *º ** *** fº *4 ºf ** sº * ** sº sº *ē * * sº * ** *& ** **g. aº * & **** *** ** *** ** ** sº * wº * sº * ** ** º- * fº * * señº, ** ** * sºrºr * º ** -- * * * ** ** º *ºº * «sº sº ** *º-º: gº • *e $980,278,086 if $965,635,000 iſ *::::::::::…; =ºs 411 27.72 RURAL, HOUSING SERVICE RURAL RENTAL ASSISTANCE PROGRAM Classification by Objects 2009 Actual and Estimated 2010 and 2011 FY 2009 FY 2010 FY 2011 Other Objects: - 4} Grants, subsidies, and contributions....... $902,222,316 $980,278,086 $965,635,000 Total direct obligations 902,222,316 980,278,086 965,635,000 412 27-73 RURAL HOUSING SERVICE The estimates include appropriation language for this item as follows (new language underscored; deleted matter enclosed in brackets): - Rural Housing Assistance Grants (including transfer of funds) For grants and contracts for very low-income housing repair, supervisory and technical assistance, compensation for construction defects, and rural housing preservation made by the Rural Housing Service, as authorized by 42 U.S.C. 1474, 1479(c), 1490e, and 1490m, [$45,500,000]340,400,000, 1 to remain available until expendedſ, of which $4,000,000 shall be for grants authorized by section 14204 of the Food, Conservation, and Energy Act of 2008]: Provided, That of the total amount appropriated under this heading, the amount equal to the amount of Rural Housing Assistance Grants allocated by the Secretary for Rural Economic Area Partnership Zones for the fiscal year 2,3 [2009|2010, shall be available through June 30, [2010]2011, for communities designated by the Secretary of Agriculture as Rural Economic Area Partnership Zones: Provided further, That any balances to carry out a housing demonstration program to provide revolving loans for the preservation of low-income multi-family housing projects as authorized in Public Law 108-447 and Public Law 109-97 shall be transferred to and merged with “Rural Housing Service, Multi-family Housing Revitalization Program Account”. - - The first change eliminates the funding for section 14204 of the Food, Conservation, and Energy Act of 2008. The second change modifies the fiscal year from 2010 to 2011. The third change modifies the expiration date from June 30, 2010 to June 30, 2011, for the Rural Economic Area Partnership Zones. - 413 27-74 RURAL HOUSING SERVICE Analysis of Change in Appropriation RURALHOUSING ASSISTANCE GRANTS Appropriations Act, 2010 - * - ... $45,500,000 3udget Estimate, 2011......................................................................................................... 40,400,000 >ecrease in Appropriation................................................. . . . . . . . . . . . . . . . . . . . . ........ -5,100,000 f PROJECT STATEMENT (On basis of appropriation) (In thousands of dollars) 2009 2010 Increase or 2011 Item of Change Actual Estimated Decrease Estimated Domestic farm labor grants - hurricane - disaster supplemental..................................... 0 O () () Migrant and seasonal farmworker emergency grants.......................................... 0 0 0 0 Very-low income housing repair grants................... $32,062 $31,600 -$600 (1) $31,000 Very-low income housing repair grants emergency Supplemental................................ 12 0 0 () Very-low income housing repair grants 2003/2004 hurricanes emer. Suppl. a ſ................. Of 0 0 0 Very-low income housing repair grants - 2005 hurricanes emer, suppl. b /........................ 2,285 0 0 () Housing repair grants, 2007 tornadoes emergency supplemental c /............................. 0 O 0 0 Housing repair grants, 2008 Disasters.................... emergency Supplemental d/............................. 2,041 0 0 () Supervisory and technical assistance..................... 0 0 0 - 0 Compensation for construction defects................... 33 500 -500 (2) 0 Rural housing preservation grants......................... 10,410 9,400 0 9,400 Processing workers housing grants........................ 0 0 0 {} Farm Bill Section 14204 grants eſ........................ 0 4,000 –4,000 (3) {} Total Available or Estimate................................ 46,843 45,500 -5,100 40,400 Total administrative expenses - 2008 disasters d/...... 150 0 0 0 Recovery of prior year obligations.............................. -1,300 0 0 0 Unobligated balance available, start of year............. -12,808 0 0 Transfer of 2007 tornadoes to community facility grants.............................................. 1,935 O 0 0 Transfer from RD Disaster Assistance Fund b /d/..... –20,000 0 0 0 Unobligated balance available, end of year.............. 26,680 O () () Total Appropriation......................................... 41,500 45,500 -5,100 40,400 **-- 4 º’ - - - - - ..afia cºach ºr el- a Qala-kaa nº. A tº ~~ TP--> -- ~4. CV4-4. --4- - ; ; —reer====Prerºrrºr- (On basis of obligations under available funds) (In thousands of dollars) 2009 2010 Increase or 2011 Item of Change Actual Estimated Decrease Estimated Domestic farm labor grants - hurricane disaster supplemental..................................... $0 $1,106 -$1,106 $0 Migrant and seasonal farmworker emergency grants......................................... . {} 5,157 -5,157 0 Very-low income housing repair grants................... 32,062 32,034 -1,034 31,000 Very-low income housing repair grants w emergency supplemental................................ 12 0 {} {} Very-low income housing repair grants 2003/2004 hurricanes emer. Suppl. a ſ................. 0 17 - 17 () Very-low income housing repair grants 2005 hurricanes emer. Suppl. b /.......................: 2,285 13,070 -13,070 () Housing repair grants, 2007 tornadoes emergency supplemental c/............................. 0 50 -50 0 Housing repair grants, 2008 Disasters.................... emergency Supplemental d /....... * * * * * * * * * * * * * * * * * * * * * * 2,041 2,809 –2,809 {} Supervisory and technical assistance.....................: {} 43 -43 {} Compensation for construction defects................... 33 579 –579 () Rural housing preservation grants......................... 10,410 10,147 –747 9,400 Processing workers housing grants........................ 0 3,167 Farm Bill Section 14204 grants eſ......................... 0 4,000 -4,000 {} Total Available or Estimate................................ 46,843 72,180 –28,612 40,400 Total administrative expenses - 2008 disasters d/...... 150 150 {} {} Recovery of prior year obligations.............................. -1,300 0 0 0 Unobligated balance available, start of year............. -12,808 –26,680 26,680 0 Transfer of 2007 tornadoes to community facility grants............................ "… 1,935 () 0 0 Transfer from RD Disaster Assistance Fund b /d/..... -20,000 {} 0 0 Unobligated balance available, end of year.............. 26,680 {} {} 0 Total Appropriation.......................................... 41,500 45,500 –5,100 40,400 Staff-years are reflected in the Salaries and Expenses Project Statement. ; 416 27-77 Project Statement Footnotes: d/ Provided by the Emergency Supplemental Appropriations for Hurricanes Disasters Assistance Act of 2005, P.L. 108-324, signed October 13, 2004, for the purpose of serving communities affected by hurricanes and tropical storms in calendar year 2003 or 2004, Provided by the Department of Defense, Emergency Supplemental Appropriations to Address Hurricane. in the Gulf of Mexico, and the Pandemic Influenza Act, 2006, P.L. 109-148, signed December 30, 2005, for the purpose of serving communities affected by hurricanes that occurred during the FY 2005 calenda year. Additional appropriations were provided in P.L. 110-329 and transferred from the Rural Development Disaster Assistance Fund. Provided by the U.S. Troop Readiness, Veterans' Care, Katrina Recovery, and Iraq Accountability Appropriations Act, 2007, P.L. 110-28, signed May 25, 2007, for areas in Kansas hit by the tornadoes on May 6, 2007. Transfer $5 million from the Rural Development Disaster Assistance Fund provided by the Consolidated Security, Disaster Assistance, and Continuing Appropriations Act, 2009, P.L. 110-329, dated September 30, 2008, Division B, which provides additional amounts for authorized activities of agencies of the Rur Development Mission Area in areas affected by a disaster declared by the President or the Secretary of Agriculture. - Provided by the Agriculture, Rural Development, Food and Drug Administration, and Related Agencies Appropriations Act, 2010, P.L. 111-80, signed October 21, 2009, for grants authorized by section 14204 of the Food, Conservation, and Energy Act of 2008. 417 27-78 JUSTIFICATION OF DECREASES A decrease of $600,000 in section 504 housing repair grants ($31,600,000 available in 2010). This decrease is a result of budgeting under tight constraints within Rural Development. There was a two percent increase in the number of loans in 2009 compared to that in 2008 and it expected that the trend will continue. This funding should be sufficient to fund very close to the historical number of grants in 2011. A decrease of $500,000 in section 509 compensation for construction defects ($500,000 available in 2010). Total construction defect claims average $60,000 each year. It is anticipated there will be sufficient carryover funds from FY 2010 to fund this program for FY 2011. - A decrease of $4,000,000 in section 14204 of Farm Bill grants ($4,000,000 available in 2010). This is new funding for FY 2010 and the outcome of program operations is unknown at this time. However, it is anticipated that there will be sufficient carryover funds from FY 2010 to fund this program for FY 2011. This program has been transferred to the Office of Outreach and Advocacy under the Departmental Administration, which will continue administering the program. 418 27.79 RURAL, HOUSING SERVICE GEOGRAPHEC BREAKDOWN OF OBLIGATIONS 2009 Actual and Estimated 2010 and 2011 Very Low-Income Housing Repair Grants 2009 2010 2011 Alabama $1,116,294 809,000 $793,000 Alaska - 137,800 192,000 181,000 Arizona 479,093 510,000 499,000 Arkansas 823,603 . 645,000 634,000 California 469,597 1,319,000 1,308,000 Colorado 294,780 324,000 313,000 Connecticut 87,647 104,000 93,000 Delaware 63,600 82,000 71,000 Florida 716,427 850,000 839,000 Georgia 1,285,733 1,024,000 1,043,000 Hawaii 191,630 265,000 194,000 Idaho 315,928 239,000 228,000 Illinois 1,118,287 738,000 727,000 Indiana 797,923 672,000 661,000 Howa 506,886 499,000 488,000 Kansas 777,629 381,000 370,000 Kentucky 1,128,181 751,000 740,000 Louisiana 746,937 675,000 664,000 Maine 709,298 300,000 289,000 Maryland 265,291 259,000 248,000 Massachusetts 183,010 153,000 $42,000 Michigan - 1,164,751 923,000 912,000 Minnesota 647,335 656,000 $45,000 Mississippi 993,200 755,000 744,000 Missouri 852,729 783,000 772,000 Montana 205,994 206,000 195,000 Nebraska 486,718 275,000 264,000 Nevada 89,945 100,000 89,000 New Hampshire 587,456 165,000 154,000 New Jersey $21,970 129,600 118,000 New Mexico 184,603 398,000 387,000 New York 1,027,178 882,000 871,000 North Carolina 1,593,596 1,403,000 1,392,000 North Dakota 481,066 131,000 120,000 Ohio 1,104,753 956,000 - 945,000 Oklahoma 435,225 589,000 578,000 Oregon 402,402 495,000 484,000 Pennsylvania 1,173,757 1,142,000 1,131,000 Rhode island 29,519 21,600 10,000 South Carolina 839,790 724,600 713,000 South Dakota 244,192 202,000 191,000 Tennessee 1,185,412 831,000 820,000 Texas 1,840,853 2,204,000 2,193,000 Utah 234,693 138,000 127,000 Vermont 336,720 147,000 136,000 Virginia 868,310 733,000 722,000 Washington 507,074 554,000 543,000 West Virginia 592,555 436,000 425,000 Wisconsin 678,005 703,000 692,000 Wyoming * 158,510 108,000 97,000 Puerto Rico 391,546 287,000 276,000 Virgin Islands - 53,554 68,000 57,000 W. Pacific Areas 363,990 500,000 489,000 Undistributed º 3,659,036 3,208,000 Total Awaii,jFst. $32,062,375 $32,034,036 $31,000,000 419 Alabama Alaska Arizona Arkansas California Colorado Connecticut Beiaware Florida Georgia Hawaii Idaho lilinois Indiana Iowa Kansas Kentucky Louisiana Maine Maryland Massachusetts Michigan Minnesota Mississippi Missouri Montana Nebraska Nevada New Hampshire New Jersey New Mexico Yew York North Carolina North Dakota Öhio Oklahoma Orcgon Pennsylvania Rhode Island. South Carolina South Dakota Tennessee Texas Utah Vermont Virginia Washington West Virginia Wisconsin Wyoming Puerto Rico Virgin Islands W. Pacific Areas g Undistributed Total Awaii,'Est, 27-80 RURAL HOUSING SERVICE (SEOGRAPHIC BREAKDOWN OF OBLIGATIONS Actual 2009 and Estimated 2010 and 2011 Rural Housing Preservation Grants 2009 2010 2011. $282,000 $250,369 $250,000 50,000 49,701 50,000 206,322 150,712 151,000 282,419 195,587 195,000 803,340 393,969 394,000 71,227 71,123 71,000 50,000 38,355 38,000 50,000 16,087 16,000 245,053 244,696 245,000 327,896 327,418 327,000 66,987 66,889 67,000 63,002 62,910 63,000 2 : 1,100 190,507 190,000 182,900 I82,633 183,000 397,684 113,458 113,000 $43,800 95,677 96,000 389,464 294,905 295,000 268,795 268,403 268,000 96,000 77,304 77,000 74,618 74,509 74,000 67,24] 67,143 67,000 338,544 252,062 252,000 141,860 141,653 #44,000 418,489 269,250 269,000 150,000 208,288 208,000 ** 52,495 52,000 50,458 60,370 60,000 100,000 22,268 22,000 100,000 42,589 42,000 55,709 55,628 55,000 121,848 121,671 122,000 267,098 233,096 233,000 403,541 380,760 381,000 100,000 34,969 35,000 292,538 292,411 292,000 239,179 162,312 162,000 176,660 120,485 120,000 312,634 312,178 312,000 50,000 8,467 8,000 228,095 227,762 228,000 50,000 50,548 50,000 3i (),000 251,724 252,000 648,246 . 647,301 647,000 50,000 36,408 36,000 #86,546 34,122 34,000 225,551 225,222 225,000 156,416 147,580 148,000 237,913 164,006 164,000 198,106 ł58,587 158,000 50,000 25,994 26,000 417,438 416,830 417,000 ** 23,115 23,000 **** 54,781 55,000 *-* 1,679,828 941,000 $10,410,417 $10,146,815 $9,400,000 420 27-81 RURAL HOUSING SERVICE GEOGRAPHICBREAKDOWN OF OBLIGATIONS Actual 2009 and Estimated 2010 and 2011 Rural Housing Assistance Grants Processing Workers Housing Grants 2009 2010 201 **** Total Avail./Est. tºº- $3,167,370 1/ sºme * 1 Cannot be distributed by geographic area in advance. 421 27-82 RURAL HOUSING SERVICE GEOGRAPHC BREAKDOWN OF OBLIGATIONS 2009 Actual and Estimated 2010 and 2011 Farm Labor Housing Grants e 2003/2004 Hurricanes for Natural Disaster 2009 2010 2011 | Total Avail./Est. ** • $1,106,100 1/ * * Migrant and Seasonal Disaster Grants 2009 2010 . 2011 Total Avail./Est, - * * $5,157,137.1/ Bºtº- # Cannot be distributed by geographic area in advance. 422 Missouri Total Avail./Est. Total Awaii./Est. Alabama Louisiana Mississippi Texas Total Avail./Est. Totai Avail.jest. Arkansas Florida Georgia Illinois indiana Howa Kentucky Louisiana Maine Mississippi Missouri Nebraska Tennessee Texas West Virginia Wisconsin Total Avail./Est. 27-83 RURAL HOUSING SERVICE GEOGRAPHIC BREAKDOWN OF ORLIGATIONS 2009 Actual and Estimated 2010 and 2011 Very Low-Income Housing Grants for Natural Disaster 2009 2010 2011 $12,128 tºº. ** $52,128 gº *º Very Low-Income Housing Grants 2003/2004 Hurricanes for Natural Disaster 2009 2010 20: 1 wº. $17,410 1/ tº ºr : tº:--> -::::: Very Low-Income Housing Grants 2005 Hurricanes for Natural Disaster 2009 2010 2013 $429,026 | -- **e. 434,582 sº ** 1,697,210 ** * —24,093. sº tºº, 2284.913 $13,069,531, 11 * Very Low-Income Housing Grants 2007 Disasters 2009 20 ft) 2011 * * $50,000 11 *ge :=3 *:::::::::::::::::::::: :==== California 5,466,138 * * ** Colorado 1,566,240 gº ºr *sº Delaware 1,401,000 ** Aºgase Florida 3,700,883 tº dºs * * Hawaii 675,784 * - * = Idaho 633,655 sº ºr •ºrºm Indiana 294,132 *** * ses sº Kansas 396,000 tºº ** Michigan 273,900 gº sº. & Eº Mississippi 728,708 sº mºs tº º Missouri 119,380 ** = * = Montana 651,005 ** ºf tº Nevada 436,512 *—º ** New Mexico 486,695 &srºº *** North Carolina 1,092,252 *** gº ºf Ohio 161,030 ** * * Oklahoma 1,900,456 ** * = Oregon 762,127 * *e *** Pennsylvania 558,192 wººp * * South Dakota 644,350 àºsº; * * Tennessee 503,200 *tº * * Texas. 293,000 tº dº. tº ass Utah 2,388,300 * * > •º ºf Washington 2,340,373 * ºf ët-º West Virginia 107,568 * * *º tº Wisconsin 652,351 tº gº * * West Pacific 236,700 ** – tººge Total Avail/Est. $31,038,143. $56,386,204 1/ $37,000,000 1/ Cannot be distributed by geographic area in advance, 430 27–91 RURAL HOUSING SERVICE MUTUAL AND SELF HELP HOUSING GRANTS Classification by Objects 2009 Actual and Estimated 2010 and 2011 FY 2009 . FY 2010 FY 2011 Other Objects: - 41 Grants, subsidies, and contributions...... $31,038,143. $56,386.204 $37,000.00 Total direct obligations................................ 31,038,143 56,386,204 37,000,00 431 27–92 RURAL HOUSING SERVICE SUMMARY OF RECOVERY ACT FUNDING (in thousands) Program/Project Activity - FY 2009 - FY 2010 PL , BA PL BA Actual Actual Available Available Rural Community Loans Program $204,369 $11,690 $931,761 $12,206 Rural Community Grants Program $31,117 $31,117 $71,086 $71,086 Section 502 Direct Single Family $17,951 $47,039 Housing Low Income Loan Program $267,124 $1,295,847 Section 502 Guaranteed Single Family $108,679 - $14,510 Housing Purchase Loan Program $8,557,498 - $1,007,673 Section 502 Guaranteed Single Family $4,724 $1,097 Housing Refinance Loan Program - $482,013 $63,776 Total Available for Program - $9,542,121 $174,161 $3,370,143 $145,938 Salaries and Expenses $2,668 $2,668 $7,232 $7,232 Total Available . $9,544,789 $176,829 $3,377,375 153,170 Project Statement- Recovery Act (On basis of available funds) (in thousands) Rural Community Loans Rural Community Grants Section 502 Direct Single Family Housing Low Income Loan Section 502 Guaranteed Single Family Housing Purchase Loan Section 502 Guaranteed Single Family Housing Loan Total Available for and Available Pro lementation Activities: Single Family Housing: FY 2009 Accomplishments: In FY 2009, 2,030 Section 502 Direct loans and 73,348 Section 502 Guaranteed loans under the ARRA program were obligated. (The guaranteed ARRA loans include 3,845 for refinancing.) 432 27-93 FY 2010 and FY 2011 Planned Activities: In FY 2010, the Agency expects to obligate an additional 9,379 loans under the Section 502 Direct loan program and an additional 8,279 Section 502 Guaranteed loans (including a projected 485 for refinancing). Community Facility Program: *RD staff does not break out program results by specific program. Because many projects incorporate ARRA funds in combination with regular direct, grant, and guaranteed loan financing, breaking outb program section would encourage double and triple counting of each project. Performance Measures: Program Performance Measure FY 2009 FY 2010 FY 2011 - Actual Target Target 1. Rural Community Facilities Programs Percentage of rural population with #.15% 1.40% access to improved health services - Percentage of rural population with 3.22% 3.40% access to improved public safety services 2, Homeownership Opportunities Section 502 Direct Single Family 2,030 9,379 Housing Low Income Loan Program Section 502 Guaranteed Single 73,348 8,279 Family Housing Purchase Loan Program Section 502 Guaranteed Single 3,845 485 Family Housing Refinance Loan 433 27g-1 RURAL DEVELOPMENT HOUSING PROGRAMs STATUS OF PROGRAMS Current Activities: In order to meet the Department’s strategic goal of assisting rural communities thrive economically, the housing programs provide loans, grants and guarantees for housing and community facilities. This includes the funding of single family homes, housing for low-income persons, the elderly and disabled, housing for farm laborers, childcare centers, fire and police stations, hospitals, libraries, nursing homes, schools, and other housing and community facilities. Since the programs inception 60 years ago by the Housing Act of 1949, nearly 2.6 million low income rural Americans have been assisted with direct loans or guarantees from USDA to attain the American dream of homeownership. - Through FY 2009, the direct loan program has made more than $63 billion in loans to low-income families who by definition are unable to obtain credit elsewhere. Despite the risk, this program has been a success as demonstrated by delinquency rates lower than other mortgage lending programs, such as FHA. The program demonstrates that a low income home loan program can be a success with non-predatory lending practices and progressive loan servicing. Historically, the largest portion of Community Facility (CF) funds goes toward health care projects but the largest number of loans or grants serves the area of fire, rescue, and public safety. In FY 2009, more than $387 million was invested in 191 health care facilities serving more than 3.3 million rural residents. During the same period, 939 communities received more than $132 million to finance fire, rescue, and public safety facilities and equipment benefitting more than 5.4 million rural residents. This funding includes ARRA and disaster funds. Specific areas being addressed currently include: 1. RHS administrative development of an automated forecasting process to standardize the budget estimation method in order to achieve more accurate budgeting of rental assistance. 2. Improvement of administrative internal controls to strengthen verification methods of tenant income in order to reduce the risk of improper rental assistance subsidy payments, thereby reducing the incidence of waste, fraud and abuse at properties financed by Rural Development. 3. Guidance has been provided to State offices has to help ensure appropriate subsidy calculations by multi-family property managers and borrowers. - Recent Accomplishments for Rural Housing Assistance Grant G) Appropriations Section 504 Housing Repair Loans and Grants Since 1950, USDA has provided nearly 350,000 Very Low income rural homeowners with repair assistance totaling more than $1.4 billion. These loans and grants, which average less than $6,000, have been especially important in recent years with rebuilding after the great Gulf hurricanes. More than 6,000 families used $50 million in Section 504 loans and grants to get their homes back in order. Section 523 Mutual and Self-Help Housing Grants - The Mutual and Self-Help program provides the only opportunity for many of the lowest income families, including a high portion of minorities, to meet their homeownership goal. Since 1966, USDA has provided $600 million to non-profit organizations around the country to organize more than 2,300 groups of families to build there own communities. This popular program is undergoing a major streamlining to hold down costs and provide better service to participant families and their sponsor groups 434 27g–2 Multi-Family Housing (MFH) Programs Section 521 Rental Assistance Program: In FY 2009 the Section 521 program provided more than $900 million in rental assistance to very low and low income tenants in properties financed with Section 515 or Section 514/516 funds. More than 210,000 families received monthly assistance to pay their rent. The Section 521 program annually conducts compliance reviews under the Improper Payments Information Act. In FY 2009, the program saw the error rate drop considerably as a direct result of training provided by Rural Development and industry groups. Section 514/516 Farm Labor Housing Program: The Farm Labor Housing program remains the only national source of construction funds dedicated for farm labor housing. This program provides loans and grants to build housing for both migrant and year- round farm laborers. Funds may also be used for related facilities such as on-site child care and community buildings. Funding is annually made available through a competitive process. Multi-family housing financed the construction and repair of more than 860 farm labor housing units in FY 2009. The selection process for farm labor housing loans and grants is conducted through a Federal Register notice, which establishes the criteria used by Rural Development to allocate these loans and grants. One of Rural Development’s goals is to attract more external funding; typically, groups attracting external financing receive more points in the application review process. Section 515 Multi-family Housing Preservation and Revitalization & Direct Rural Rental Housing Programs: Multi-family housing preserved and constructed more than 6,400 units of housing through the Section 515 Multi-family Housing Preservation program and the Section 515 new construction program in FY 2009. The RD Voucher program has offered about 9,000 vouchers to residents in rural America over the five year demonstration period. In that time, over $16.3 million in Voucher funds have been obligated. Over 90% of these rural residents have elected to remain in the property they have called home for a period of years. Intentions behind the program were for a simple, direct and responsive approach to program delivery, without duplicating other federal rent assistance programs. Section 538 Guaranteed Rural Rental Housing Program (GRRHP): In FY 2009, the Guaranteed Rural Rental Housing program (GRRHP) obligated funds for the construction, repair, and rehabilitation of approximately 4,200 affordable rural rental housing units. More than 2,200 were newly constructed units. The GRRHP leverages more than $4 of external funding for each dollar of guaranteed funds. Utilizing other funding sources enables the GRRHP to produce more new affordable housing and repair more existing affordable housing with a given amount of funding. The total amount of external funding attracted to the projects funded using the GRRHP was more than $500 million, which help build or preserve 86 projects. The GRRHP partnered with Ginnie Mae and Fannie Mae to provide added liquidity to lenders making guaranteed loans. Guaranteed loans in conjunction with Ginnie Mae and Fannie Mae’s efforts allows Rural Development to attract private capital to rural communities while still providing affordable housing for very low and low income households. 435 27g-3 Section 533 Housing Preservation Grant Program: The Housing Preservation Grant program strives to improve the quality of existing multi-family housing and some single family housing units through partnerships with various local public bodies and non-profit organizations. Multi-family housing improved the housing quality of more than 2,300 families in FY 2009. During that year, this program had committed more than $10 million to non-profit organizations and public bodies to be used to repair properties. - The Housing Preservation Grant program is administered through a public notice process, in which non- profit and public bodies are invited to apply for grants to repair single family and multifamily housing units that are below housing standards. This program attracted approximately $2.00 of private and public funds for each $1.00 of Rural Development housing preservation grants. - - Processing Workers Housing Grants Since 2004, the Housing and Community Facilities Programs has provided housing for processing workers through the Rural Housing Assistance Grant (RHAG) Budget. Grant proposals are accepted for agriculture, aquaculture, and seafood processing and/or fishery worker housing grants in the States of Alaska, Mississippi, Utah, and Wisconsin. To date, this program has provided 100 units of housing to very low, to low and moderate income processing workers in Mississippi and Alaska. Farm worker Job Stability, Safety and Training Demonstration Program As noted in Section 14204 of the Food, Conservation, and Energy Act of 2008, the “Farm Worker Job Stability, Safety and Training Demonstration Program” joint Office of Advocacy Outreach (OAO) Notice of Funding Availability (NOFA) will fund grants to assist agricultural employers and farm workers providing services that will improve the supply, stability, safety, and training of the agricultural labor force. Such eligible services shall be, but are not limited to, agricultural labor skills development; the provision of agricultural labor market information; transportation; workplace literacy and assistance with English as a second language; short-term housing while in transit to an agricultural worksite; and health and safety instruction, including ways of safeguarding the food supply of the United States. As authorized by Section 14204 of the Food, Conservation, and Energy Act of 2008, $4,000,000 is appropriated to provide these services through FY 2012. Additionally, $1,974,000 or 10 percent of Section 541 and 516 appropriations for FY 2010 will be used to provide services for short-term housing while in transit to an agricultural worksite. OAO will award six (6) grantees or two (2) eligible entities in each of the following regions: Eastern, Central and Western. Eligibility to provide such services is limited to nonprofit organizations or to a consortium of nonprofit organizations, agribusiness, State and local governments, agricultural labor organizations, farmer or rancher cooperatives, and community-based organizations with the capacity to train farm workers. This program is in infant stages. Reportable accomplishments will be forthcoming. Section 516 Domestic Farm Labor Housing Grants 2003/2004 Hurricanes Emergency Grants Since 2004, the Housing and Community Facilities Programs has provided housing for processing workers through the Rural Housing Assistance Grant (RHAG) Budget. These funds are announced and made - available by Public Notice which requests proposals for grants to provide emergency assistance to migrant farm workers and seasonal farm workers. Such funding provides emergency assistance repairs to houses of very low, to low and moderate-income migrant and seasonal farm workers. To date, this program has assisted over 100 farm worker households by providing repairs to 200 units. 436 27g–4 Single Family Housing Programs Section 502 Direct and Guaranteed Single Family Housing Loans; In response to the current mortgage situation nationally, Rural Development housing programs provided more than 11,500 direct and 129,000 guaranteed homeownership opportunities (including disaster assistance) in FY 2009 — an increase of nearly 120 percent for the combined programs. The increase is due to the popularity of the guaranteed program, which is the only significant, no-down payment mortgage program remaining. Additional funding was provided under the American Recovery & Reinvestment Act (ARRA). The popularity of the RHS programs is expected to increase. The Direct and Guaranteed programs will be using new automation tools to meet the growth in demand. The Guaranteed Underwriting System (GUS) is popular with lenders and facilitates ongoing expansion of the guaranteed program. GUS enables participating private-sector lenders to make loans faster and less expensively, which results in better quality loans and more consistent program delivery. GUS also fulfills legal requirements under the Freedom to E- File Act and the Government Paperwork Elimination Act. Enhancements to GUS and improved lender monitoring will help Rural Development better manage increased loan volume, GUS may also be expanded to provide underwriting assistance for the direct program. The number of homes financed by the direct loan program has declined since the year 2000 as funding levels remained flat and home prices continued to increase. The number of initial loans dropped below 10,000 for the first time since 1961. However, a significant decrease in subsidy rate and new funding available from ARRA, promoted an increase in the number of direct loans made in FY 2009. The Mutual and Self-Help program allowed nearly 1,100 families to build their own homes in FY 2009 using their own “sweat equity”. Community Facilities Program Emphasis on financing critical access hospitals resulted in more than $800 million in Community Facility (CF) financing going to 195 such facilities from FY 2001 through FY 2009. Several of these facilities have received nation-wide attention as successful models that other rural communities can follow. Program staffs have developed expertise and relationships with lenders and other health care financing experts, enabling them to provide guidance to smaller rural communities lacking expertise in this complex area. For these facilities approved in FY 2009, ARRA funds may have been included in the financing packages. The outreach and marketing project initiated in the middle of FY 2007 continued to show impressive results through the end of FY 2009. For the third consecutive year, the guaranteed loan program had a banner year in terms of funds utilized. While the overall housing economy suffered severe losses in FY 2009, this program has continued to provide financing for rural beneficiaries with few defaults due to strong underwriting standards, w 437 27-94 RURAL DEVELOPMENT HOUSING PROGRAMS. Summary of Budget and Performance Statement of Goals and Objectives Rural Housing Programs Mission: Rural Development Housing Programs provide affordable housing to rural communities. This helps communities create wealth as rural families of all income levels are provided with an opportunity to enjoy the advantages of homeownership or access to affordable rental housing. This includes a place-based investment in rural hometowns which grows as owner equity increases and fills an important need for the entire community to thrive. Multi-Family Housing: In order to meet the agency strategic goal of improving the quality of life in rural America, the multi-family housing program is focusing on providing new rental opportunities for the rural tenant population, tenant protection and revitalization of an aging housing portfolio. A voucher program is provided to protect tenants threatened with displacement from properties exiting the program. To maximize new rental housing construction, we expect new construction from both Section 515 direct loans and Section 538 guaranteed loans, - - While repair and rehabilitation of the portfolio is important, funding through an open ended demonstration program has been carried out since 2006 and the most cost effective and justified repairs have been achieved. At this point, additional funding in the demonstration program could be seen as over subsidizing the multifamily housing property owners. Meanwhile, the traditional way to fund revitalization has been though the multi-family housing direct loan program with rehabilitation loans. While the 2011 Budget proposes to terminate funding for the multi-family housing revitalization demonstration program, it proposes to increase the multi-family housing direct loan program from $70 million to $95 million, ensuring that more affordable rental housing opportunities are created for the very-low income tenant base in rural America. This program can be used for repair and rehabilitation as well as new construction. The Section 538 Guaranteed Rural Rental Housing Program provides a public/private partnership with lenders and the investment community to build and preserve affordable housing in rural America. This partnership enables rural communities to attract private capital to build and preserve affordable rental housing. This capital along with other public funding sources provides the local community to build much needed affordable housing. The construction and operation of these affordable housing properties provides job opportunities for these rural communities. The requested rental assistance at $966 million is sufficient to accommodate all of the rental assistance contracts that will need renewal funding in FY 2011. Single Family Housing: Since financing the first farm home in 1950, USDA’s single family housing programs have assisted over 3 million rural families with the housing portfolio as of the end of Fiscal Year 2009 at $39.4 billion in loans and loan guarantees for home purchase and repair. These programs provide the only means for many low- and moderate-income rural residents to become successful homeowners. - To meet USDA's strategic goal “Rural communities create prosperity so that they are self-sustaining, repopulating and thriving economically,” the Single Family Housing programs focus on successfu homeownership through quality loan underwriting and prudent loan servicing. - To make the Direct program more efficient, the agency is working towards automation of its loan application processes where possible. We are working on developing an on-line loan application process 438 27-95 that will allow potential applicants and partners to submit loan applications through an electronic interface that can be automatically imported into our loan processing systems. In addition, we are working towards adopting the current Guaranteed Underwriting System to include the Direct loan program, helping to make our loan underwriting more efficient and consistent. The key goals discussed below measure the agency’s success in achieving successful homeownership. RD’s Housing Programs have one strategic goal and one strategic objective that contributes to the Department’s Priority Goal. USDA Agency Agency Objectives Programs that Contribute Key Strategic Strategic Outcome Goal/Objective Goal USDA Priority Agency Objective 2. 1: Provide Sec. 502 Guaranteed Single Key Goal : Assist Goal 2: decent, safe and Family Housing Purchase Outcomes: rural Improve the affordable housing Sec. 502 Guaranteed Single Decent, communities to quality of - Family Housing Refinance safe and create prosperity life in Rural Sec. 515 Direct Multi-Family affordable so that they are America Housing Loans housing self-sustaining, Sec. 538 Guaranteed Multi- repopulating Family Housing and Sec. 504 Very Low Income economically Housing Repair Loans thriving. Sec. 504 Housing Repair Grants Sec. 524 Housing Site Development Loans Sec. 523 Self-Help Land Development Housing Loans Sec. 521 Rental Assistance Program Grants Sec. 502 Rental Assistance Program Grants Sec. 514 Farm Labor Housing Loans Sec. 516 Domestic Farm Labor Housing Grants Sec. 523 Mutual Self-Help Housing Grants Sec. 525 Supervisory and Technical Assistance Grants Sec. 533 Housing Preservation Grants Processing Workers Housing Grants Credit Sales of Acquired Property – Single Family Housing Credit Sales of Acquired Property - Multi-Family Housing Sec. 542 Multi-Family Housing Voucher Program Key Outcome: The single family housing programs support the Secretary’s Priority Goal. This goal is “Rural communities create wealth so they are self-sustaining, repopulating and thriving economically.” 439 27–96 Performance measures related to the single family housing programs include targets for the number of Section 502 loans financed annually and for the percentage of these loans to rural minority families. Single family housing includes smaller programs to support and supplement its homeownership and repair programs. The self-help building method allows even the lowest income families to contribute their sweat to obtain equity in their homes while creating strong community bonds. These programs are aimed at rural areas with large numbers of minorities. - - Key Outcome Measure: Single Family Housing Long-term Performance Measures: Measure 1: Number of homeownership opportunities created measured in terms of the number of loans made. 502 Direct 502 - - Guaranteed Baseline Year: | 12,651 31,751 2003 2004 Actual 14,641 34,251 2005 Actual 12,315 31,480 \ 2006 Actual 11,461 29,476 2007 Actual 10,675 32,481 2008 Actual 9,829 62,320 2009 Actual 9,479 46,478 2010 Target 9,030 | 97,000 2011 Target 9,202 89,791 2012 Target 9,200 89,500 Explanation: This is an output measure for the number of home loans to be funded with program funds. This measure is dependent on program levels and housing costs. This is a significant measure because it shows the raw level of assistance the program is providing on an annual basis. This is what allows the government to say how many households we are assisting with this program. That has historically been what the stakeholders were interested in when inquiring about the annual funding level. A higher loan level results in a higher number of households assisted. Measure 2: The number of basis points in the single family housing direct and guaranteed loan programs should not exceed the foreclosure rate of FHA's loan portfolio's foreclosure rate by more than certain thresholds. - - • . FHA Foreclosure Rate Compared to 502 Direct and Guaranteed - 502 Direct. 502 Guaranteed Baseline Year: 2003 108 (-75) 2004 Actual 98 (-57) 2005 Actual 99 (-95) 2006 Actual 85 (-97) 2007 Actual 109 (-86) 2008 Actual | 11 (–94) 2009 Actual - º (-1.6) 440 27–97 300 25% 2010 Target 2011 Target 300 25% 2012 Target 300 25% This measure compares default rates for section 502 direct and guaranteed loan program borrowers, in comparison that of Federal Housing Administration (FHA) loans. - The Self-Help default rate should be lower than the regular single family housing loan. The overall direct loan and guaranteed loan portfolio should compare favorably to FHA rates. For Section 502 self-help housing borrowers, this measure compares the number of self-help borrowers who lose their homes in foreclosure to other Rural Development borrowers. Self-Help Loan Delinquency compared to 502 Direct portfolio Number of Basis Points below 502 Direct Delinquency Baseline Year: Basis Points 2003 Actual 413 2004 Actual 317 2005 Actual 417 2006 Actual 75 2007 Actual 343 2008 Actual 305 2009 Actual 275 2010 Target 200 2011 Target 200 2012 Target 200 Self-Help Foreclosure Rate compared to 502 Direct portfolio Number of Basis Points below 502 Direct Foreclosures Baseline Year: 2003 Actual 130 2004 Actual 1 I5 2005 Actual 127 2006 Actual 85 2007 Actual 122 2008 Actual i 10 2009 Actual 128 2010 Target 100 2011Target 100 2012 Target 100 All these measures gauge the long-term success of Rural Development's affordable housing programs against comparable programs. - - 441 27-98 Selected Past Accomplishments Toward Achievement of the Key Outcome: Guaranteed Loan Program: Through automation initiatives, it is getting faster and cheaper for rural Americans to purchase their homes. In FY 2007, the agency began rolling out an automated guaranteed underwriting system (GUS). GUS enables participating private-sector lenders to make loans faster and less expensive, results in better quality loans and more consistent program delivery. It fulfills legal requirements under the Freedom to E-File Act and the Government Paperwork Elimination Act. - - - - We continue to encourage mortgage loan servicers to use a wide range of loss mitigation techniques, Greater emphasis on loss mitigation results in fewer foreclosures, fewer loss claims, and increased successful homeownership by borrowers who otherwise would have lost their homes. Loss mitigation techniques include special forbearance, loan modifications, and when possible, pre-foreclosure sales and the acceptance of deeds in lieu of foreclosures. RD processes over 250 such homeownership opportunities a month. - - Direct Loan Program: In FY 2009, Rural Development conducted a one year program to assist borrowers during these difficult economic times. The Housing Assistance Program (HAP) was implemented to minimize the pressure exerted on fiscally strapped borrowers and was extended to 5,100 homeowners. The agency set aside funds to pay towards the borrowers’ monthly escrow installment for a period up to six months. During those months, the borrower paid only the regular mortgage payment and any outstanding fees. The escrow portion of their payment paid by the agency was then set aside to be paid at the end of the loan or when the borrower refinances or sells their dwelling. In this way, the 5,100 borrowers avoided foreclosure which reduced potential losses to the government by an estimated $86.7 million—an excellent investment of about $5 Million, Despite issues throughout the mortgage industry, the Single Family Housing Direct loan. portfolio experienced an increase in the number of Foreclosures of only 4% from prior year. The overall industry reported 20-40% increases in foreclosures. Likewise, both SFH-GRH and Direct loan program delinquency outperformed the Federal Housing Authority (FHA) product throughout FY-09. Rural Development helped to mitigate the greatest economic crisis of the past sixty years through its own Homeowner Assistance Program (HAP), an aggressive, yet socially sensitive, implemented techniques to minimize the number of adversely impacted borrowers displaced by foreclosure. Selected Accomplishments Expected at the FY 2011 Proposed Resource Level: USDA will responsibly manage its Direct and Guaranteed loan portfolios with a goal of keeping its loan delinquency rate within certain thresholds of the FHA delinquency rate for FY 2011. FHA loans are serviced by the private sector. USDA's direct loan delinquency is expected to be higher because they are ‘means tested’ for families who cannot afford other credit. . . FHA Delinquency Rates compared to 502 Direct and Guaranteed 502 Direct 502 Guaranteed 2004 Actual .52 -345 2005 Actual .66 –212 . 2006 Actual 12.3 -309 2007 Actual 75 -164 2008 Actual –71 –211 . 2009 Târget -83 –241 2010 Target 150 50+ 2011 Target 150 50% 2012 Target 150 50% 442 27–99 Guaranteed Loan Program: The goal in FY 2011 is to provide approximately 88,000 homeownership opportunities for low- and moderate-income rural families. This projection is based on an anticipated five percent annual increase from the average loan in FY 2009 as the cost of housing increases with the program reaching a wider range of borrowers. - We intend to responsibly manage the guaranteed loan portfolio with a goal of keeping its loan delinquency rate within 50 basis points of the FHA delinquency rate in FY 2011. FHA loans, like guaranteed loans, are serviced by the private sector. Even though guaranteed loans are “means tested,” the guaranteed loan portfolio has performed better than FHA over the past several years. More lenders are doing business in rural America and more are looking to Rural Development for financing those with limited income and funds available. Further changes made to the guaranteed underwriting system (GUS) in FY 2010 and FY 2011 will increase its effectiveness and increase its “user friendliness” to lenders. An improved GUS will enable participating private-sector lenders to make loans faster and less expensively, will result in better quality loans and more consistent program delivery, and will fulfill legal requirements under the Freedom to E-File Act and the Government Paperwork Elimination Act. Efficiency Measure For the Direct SFH program, the agency has been working on an efficiency measure regarding the ratio of total annual obligated salaries and expenses funding over the obligated average loan portfolio balance outstanding plus accrued interest and fees plus total average grants. At the moment cost accounting systems are not in place to track expenses at the program level. The agency has been working to differentiate administrative expenses among each loan program. Year 2009 Actual Under Development 2010 Actual Under Development 2011 Target Under Development For the Guaranteed program, the efficiency measure is “The Workout to Real Estate Owned (REO) Ratio”, as defined as follows: The sum of Approved loss mitigation workouts (Special Forbearances, Loan Modifications, Pre-foreclosure Sales and Deeds-in-Lieu) divided by the sum of (Approved Workouts + REO) minus Deeds-in-Lieu. *Deeds-in-Lieu are weighted at half (50%) of a fully weighted workout in the numerator of the Workout to REO Ratio since Deed-in-Lieu results in an REO. Even though the Deed-in- Lieu is a favorable loss mitigation result that reduces loan losses, it should not receive equal credit of workout that results in a loan reinstating or a property that is liquidated prior to a foreclosure sale. The Workout to REO Ratio measures the level of effectiveness in preventing defaulted loans from going on to foreclosure. Effective loss mitigation will reduce the number of loans that become seriously delinquent thus reducing the amount of loans that could result in foreclosure and subsequent loss claim payment. The higher the Workout to REO Ratio, the more favorable the result and is recognized by the mortgage industry as a true measurement of loss mitigation performance. - Year: Workout : REO ratio 2006 Actual 38.28% 2007 Actual - 43.24% 2008 Actual 54.59% 2009 Actual 53.82% 2010 Target 60% 2011 Target 60% 2012 Target 60% 443 27-100 HPPG Measure: This measure will be accomplished by the number of home loans made. The expected number of single family housing guaranteed loans is about 90,000 for FY 2011. Multi-Family Housing Long-term Performance Measure: The strategy to achieve the long-range goal of creating wealth in rural communities through thriving affordable multi-family housing properties and the provision of decent, safe and sanitary housing for rural residents begins with Multi-Family Programs’ effort to revitalize its housing portfolio. Methods of achieving this objective include identification of the core properties in the portfolio that have the best chance for continued economic health and as a target for use of limited financial resources. Once identified, those properties that have the best chance for continued economic health are addressed using the 515 direct loan program. - Measure: Increase the percentage of A and B properties in the portfolio by one percentage point each year. Note: Rural Development uses an alphabetical four-tier classification system — A is highest; D is lowest– that categorizes properties according to physical condition, loan status and the number of outstanding or unaddressed corrective actions. As a part of its efforts to better analyze the loan portfolio, Rural Development instituted an automated program that re-categorized properties based on outstanding compliance issues. This re-categorization resulted in a shift in classification proportions: A and B properties at the beginning of FY 2007 constituted 60 percent of the portfolio. The target remains at one percent move of properties per year into the higher A and B categories as a result of improved oversight, aggressive action against owners, and implementation of the multi-family portfolio revitalization program. Baseline year: 2002 – 82 percent of the baseline year portfolio Actual year 2008 – 61 percent (see Note on re-categorization above) Target year 2009–62 percent - Target year 2010–63 percent Target year 2011 – 64 percent Measure: Attract private capital (leverage) to preserve existing affordable housing and to build new, safe decent, sanitary, and affordable housing. The Section 538 program, over the past several years has attracted more than $4 of private capital for each $1 of loan guaranteed. The goal is to grow this leverage ratio by 30% each year. The goal for FY 2009 is continue to attract more than $4.00 of public and private funds for each $1.00 of loan guaranteed despite the credit market issues and the capital market issues. The Section 515 program and MFH Preservation demonstration program attract additional public and private funds as well. The Farm Labor Housing programs provided approximately $3 of external funding for each $1 of Federal funding. The goal for all programs is to increase the leverage amount by 30% each year. Selected Past Accomplishments Toward Achievement of the Key Outcome: Multi-family housing (MFH) program has established an Electronic Data Interchange facilitating electronic reporting and a dynamic mapping facility to determine program-eligible areas. Ongoing efforts include the development of automated systems to facilitate underwriting, guarantee fee collection and improve loss claim processing. These systems are based on those already in use by Rural Development’s private partners. Rural Development’s loan account and asset management servicing group initiated efforts to “train-up” newly-transferred RD staff that may be unfamiliar with Multi-family program requirements. These regional “basic servicing training” efforts, sponsored by several States, enable new and experienced staff to exchange ideas and information and learn or re-acquaint themselves with program fundamentals. MFH National Office staff sees this effort continuing through the new fiscal year as RD priorities require staffing changes. MFH has also integrated strengthened internal controls in its servicing oversight and monitoring through improved guidance issued to borrowers and management agents. Improper payment error rates have been reduced significantly and staff continues to work with industry groups to ensure a consistent 444 27–101 trend. This monitoring continues annually to ensure the payment error rate is well within the range established in the Improper Payment and Information Act. - - The voucher program, now in its fourth year, has issued or renewed over 5,000 housing vouchers to tenants in more than 42 States as of the end of FY 2009. The program is designed to provide a rental subsidy to supplement the tenant’s rent payment. The Section 514/516 Farm Labor Housing program financed 1,900 units of housing in the Section 514/516 farm labor housing program in FY 2009 and will finance a similar number in FY 2010. The MFH Preservation effort has included the Farm Labor Housing programs for the first this past year. Including farm labor properties into the preservation will enable many farm labor properties to utilize the range of financing tools currently available to the Section 515 portfolio. Use of these tools on many farm labor properties will enable these properties to continue operating for 20 years or more. Multi-family housing financed 5,781 units of housing in the Section 515 rural rental housing program in FY 2009. More than 80 percent of these units financed were repairs and revitalizations. As current affordable housing properties leave the affordable portfolio, replacement of these affordable housing units is critical. Both the Section 515 and Section 538 programs financed new construction of affordable housing units. Rural Development has developed partnerships with Freddie Mac, Fannie Mae and Ginnie Mae to get the funding sources provided by these conduits to work with our programs. We have a pilot initiative with Freddie Mac to make first mortgage loans, after the agency subordinates to provide rehabilitation funding for our older Section 515 properties. Rural Development has partnered with Ginnie Mae to provide new construction financing and repair financing in the Section 538 guaranteed rural rental housing properties. Housing preservation grants program strives to improve the quality of existing multi-family housing units through partnerships with various local organizations. Multi-family housing provided non-profits and public bodies with grants to enable them to raise the quality of housing for 2,215 families in FY 2009. Selected Accomplishments Expected at the FY 2011 Proposed Resource Level: The agency has approved portfolio transfers, consolidated transfers and single property transfers to address the financial needs of a large portion of the 15,000 property portfolio. In FY 2011, the agency expects to continue approving more portfolio and consolidated transfers. The section 515 program expects to build 805 new units. In FY 2011, multi-family housing is expecting to finance 5,132 units using Section 538 loan guarantees with the $129 million in program funds. Multi-family Housing Programs expects to renew about 212,000 rental assistance contracts in FY 2011. Rental Assistance contracts are on a one-year contract term and the program continues to monitor the performance of these contracts for early renewal. Rental assistance units in the multifamily housing portfolio allow RD housing programs to continue to provide affordable housing to the very-low income residents of Section 515 and Section 514 rural rental housing. Efficiency Measure: The amount of 3" party financing in RD financed properties is a measure of efficiency. This 3"party financing, or leverage, enables Rural Development’s program level of funds to reach more families who need affordable housing. - - Baseline Year: 2002–$161,805,674 Target year: 2007–$403,972,482 Target year 2008–$453,055,886 Target year 2009 -- $501,597,588 445 27-102 Target year 2010 --- $550,139,290 Target year 2011 --- $598,680,992 Key Outcome: HPPG Measure: The only Multi-Family Housing Program that appears in the USDA Performance and Accountability Report is the Section 521 Rental Assistance Program (RA). RA is the subject of annual improper payment audits to ensure that the appropriate subsidy is being paid on behalf of low- and very-low income tenants in Section 514 and Séction 515 multi-family properties. The ultimate target rate for reduction of improper payments is an error rate under 2.5% of program outlays. In FY2009, the RA program reported a rate of 2.06%, a reduction from the prior year. Program audits review documentation collected and used by private property managers to support subsidy requests. In recent years, the Program has undertaken aggressive efforts to educate the property management industry and program borrowers to ensure appropriate and complete documentation. Despite having an error rate below the targeted minimum, the program continues to closely monitor the performance of these private property managers, and annual audits will continue indefinitely. - Community Programs Community Facilities: Hospitals, schools, public safety buildings and facilities, child and elder care facilities, community centers, town halls, libraries, and many other social and community services that directly enhance the quality of life of rural residents. In an increasingly knowledge-based economy in which both individuals and businesses have unprecedented mobility, the availability of quality community services is often a threshold condition for consideration in site location decisions. Program funding is primarily used to improve or replace community facilities that are functionally obsolete. Grant funding is essential to provide some portion of equipment and facilities that exceed an essential community facilities repayment capacity. Rural Development housing programs have one strategic goal and one strategic objective that contribute to the Department’s Strategic Goal: - USDA Agency - Agency Programs that Contribute Key Priority Strategic Objectives - Outcome Goal Goal - - USDA Agency Objective 2.2: Rural Community RD Key Priority Goal 2: Develop Programs Outcome 2: Goal: Rural Improve community Community Facility Direct Develop communities the infrastructure Loans community . Create quality of Community Facility infrastructure prosperity so life in Guaranteed Loans that they are Rural - Community Facility Grants self- | America - sustaining, repopulating and economically thriving 446 27-103 Key Outcome: Develop community infrastructure * : By assisting communities in developing essential community facilities, Rural Development is directly supporting the Secretary’s priorities. As communities become able to provide their residents with such vital amenities as health care, quality education, child care, libraries, and etc., the area becomes more attractive to business and industry. It becomes more stable and, over time, more economically sustainable. • Rural Development will continue to market its programs, to insure that officials and leaders in rural America are aware of the financial assistance RD can provide. We will continue to monitor our lending practices and underwriting standards to ensure that we are making quality investments. HPPG Measures: 1. Number of rural residents served by new or improved essential community facilities. 2. Funds dedicated to the renovation and construction of child care and public school facilities, 3. Percentage of projects with completed environmental reviews prior to loan and grant obligation. Long-term Performance Measures: The original annual measures were (1) to increase the percentage of the rural population with improved health care services by 5.5 percent by 2010; and (2) to increase the percentage of the rural population with improved public safety services by 3 percent by 2010. These goals were met (and exceeded, in the case of public safety services) by FY 2009. Beginning in FY 2010 and continuing until FY 2015, the goal for health care will be to increase the percentage of the rural population served from 5.4 percent to 6.3 percent, while the goals for public safety facilities will be to increase the percentage of the rural population with new or improved services from 5.0 to 5.9 percent. Selected Past Accomplishments Toward Achievement of the Key Outcome: - In FY 2009, community facilities continued to make significant progress in assisting rural communities in 'financing critical access hospitals, which constitute one of the most critically vital services a community. can provide. As these hospitals have become increasingly complex and expensive, rural communities face new challenges in obtaining affordable financing. A good example is the critical access hospital owned by the Wallowa Health Care District in Enterprise, Oregon. The 25-bed acute care facility, with an attached 32 bed nursing wing, replaced a hospital constructed in 1950. The new facility was completed in March, 2007, at a total cost of $22,619,636. The financing package consists of an $8 million community facilities direct loan, two community facilities guaranteed loans totaling $8.5 million through Community Bank of Joseph, Oregon, and hospital contributions of $6,119,636. The level of community support for this project is demonstrated by the fact that the hospital was able to contribute 27 percent of the project cost. A total of 50 hospitals and critical access hospitals and 10 outpatient facilities were funded in FY 2009 for a total investment of $163 million. Increased numbers of requests for financing of critical access hospitals are expected in the coming years. In the past, the community facilities program has successfully provided large numbers of rural communities with health care facilities, fire and rescue equipment, and educational facilities, as well as a wide variety of other services. In FY 2009, USDA provided funds to construct, renovate, or improve over 1,800 essential community facilities. Rural Americans had new or improved services available from approximately 194 health care facilities, 951 public safety facilities, 259 educational facilities, 268 public buildings and improvements, and a number of other essential community facilities. More than 16.5 million rural residents had new or improved services available to them through these facilities. - Selected Accomplishments Expected at the FY 2011 Proposed Resource Level: Retaining or attracting population, providing basic infrastructure, improving the quality of life, and - increasing asset values are economic strategies used by government to assist rural economies. Given the funding level proposed for FY 2011, we expect to continue our steady progress in helping rural communities meet the most basic needs of their residents. We anticipate that approximately 2,300 new facilities will be funded in FY 2011, 447 27-104 his program is contributing to three new Initiatives: the Regional Innovation, Healthy Foods, Healthy Weighborhoods, and Know Your Farmer, Know Your Food Initiatives. 3fficiency Measures: The Community Facility program’s efficiency measure is the annual loan loss ratio for the direct and guaranteed loan programs. This is calculated by the annual amount of losses in each loan program, espectively, divided by the outstanding loan portfolio balance as of September 30. 448 27-105 RURAL DEVELOPMENT HOUSING PROGRAMS Summary of Budget and Performance Key Performance Outcomes and Measures Goal: Assist rural communities to create prosperity so that they are self-sustaining, repopulating, and economically thriving. Key Outcome: Decent, safe and affordable housing. Key Performance Measures: • Measure #1: Home Loans • Measure #2: Units selected for construction or rehabilitation Performance Measure 2006 Actual 2007 Actual 2008 Actual 2009 Actual 2010 Target 2011 Target Performance Measure #1 Home Purchase loans Section 502 guaranteed loans a, Units b. Dollars (billions) 29,476 $2.9 32,481 $3.3 56,745 $6.2 46,478 $5.7 97,000 $12.5 89,791 $12.0 Performance Measure #1 Home loans — initial & subsequent Section 562 direct loans a. Units b. Dollars (billions) 11,461 $1.1 10,675 $1.1 9,829 $1.1 9,479 $1.1 9,030 $1.1 9,202 $1.2 Performance Measure #1 Home loans — initial & subsequent ARRA Recovery Act loans -- Sec. 502 Guaranteed a. Units b. Dollars (billions) - Sec. 502 Direct a. Units b. Dollars (billions) 73,348 $9.0 2,030 $.267 8,279 $1.1 9,379 $1.3 $0 ${} Units reported for sec. 502 direct loans are now “Loans.” This includes all initial and subsequent obligations. Since FY2006, the portion of funding for subsequent loans has totaled 1.0% or less each year. This change simplifies tracking and clarifies reports. 449 27–106 otes: 1.) A significant number of sec. 502 guaranteed and direct loans were made in FY 2006-08 with applemental Hurricane funding. These are not included above. 2.) Recovery Act funds do not include 3 6 available for administrative expenses. - 2006 2007 2008 2009 2010 2011 Performance Measure Actual Actual Actual Actual Target Target Performance Measure #1 Sec. 502 direct loans for Self-Help homes ection 523 mutual self- help grants a, Units 1,474 1,277 1,202 1,073 1,200 1,250 _b. Dollars (millions) $34.0 $35.5 $37,9 $31.0 $56.4 $37.0 Performance Measure #2 - Units selected for construction or rehabilitation Section 515 direct rental ousing a. Units - 5,731 6,166 5,977 5,781 5,340 || 6,059 b. Dollars (thousands) $99,200 $98,925 $131,714 $67,738 $69,512 95,236 Performance Measure #2 Jnits selected for Sonstruction or rehabilitation Section 538 guaranteed ‘ental housing loans a Units 2,354 4,102 5,457 4,252 5,805 5,132 b. Dollars (thousands) $97,200 $90,356 | 132,381 120,852 141,487 129,133 'erformance Measure #2 Dontracts to be renewed º ". 521 rental ssistance ** a. Units - 42,800 89,387 120,449 202,525 248,000 212,000 b. Dollars (thousands) $638,651 $615,770 $478,715 $902,222 $980,278 965,635 Rental Assistance renewal contracts in FY 2006 were for a four-year period; renewal contracts in FY 2007 were for e- or two-year periods. Renewal contracts in FY 2008 were for a one year period. Projected figures reflect one-year ntracts. Units shown in FY 2008 forward are only for renewals and do not include RA allocated for new nstruction or the preservation incentive program. Dollars in FY 2008 forward reflect total amounts used for all egories of Rental Assistance, not just renewals, - 450 27–407 2006 2007 2008 2009 2010 2011 Performance Measure Actual Actual Actual Actual Target Targe Performance Measure #2 Units selected for construction or rehabilitation Section 514/516 direct farm labor housing loans & grants a. Units 1,980 1,285 2,599 1,905 1,931 1,90( b. Dollars (thousands) $51,977 $50,122 $42,005 $49,485 $39,214 $37,16( 451 27–108 HOUSING AND FACILITIES EXHIBIT 2-6 Full Cost by Secretary's Strategic Priorities Strategic Priority: Assist rural communities to create wealth so they are self sustaining, repopulating and thriving. PROGRAM PROGRAM ITEMS 2009 AMOUNT 2010 AMOUNT 2011 AMOUNT $1,12] .215 i. i2l 488 $1 710 ! 733 15 15 11 66 $27,713 820 measure: units 21.90 21.08 | 4 | .487 $129,133 l 19 14 units for new const. or rehab. Measure 452 PROGRAM ITEMS - 2009 AMOUNT 2010 AMOUNT Measure Total measure: # of sites MTE unit Łevel Costs T # of sites #163SliTe: 291 f AMOUNT 3. 109.33 $11,449 556 1.812 853 23 453 PROGRAM PROGRAM ITEMS 2009 AMOUNT 2010 AMOUNT 2011 AMOUNT and F . . . . $37,461 19.795 #5 Total measure: units selected for 1 Measure (unit 26,03 Łevel $48,000 ! {} {} T T - 4,419 Measure 3 5.57 Honsing Revitalization Program (MHRP): Zero Percent Loans, Soft Second Loans, MHRP Grants, (Section sis) 4 and MHRP Preservation Demo Revolving Loan Level 763 97 31,758. Costs {} {} Costs 0 0 Total 197 1,758 FTES 0. 0. for new const, or rehab. unlt measure: # build their own homes T Measure (unit Level Measure 454 27–111 PROGRAM PROGRAM HTEMS 2009 AMOUNT 2010 AMOUNT 2011 AMOUNT ($000) ($000) ($000) Rural Community Programs - Direct Community Facilities Loans, Guaranteed Community Facility Loans, Community Facility Grants º Program Level $435,502 $1,204,545 $531,083 Budget Authority 56,921 77,512. 41.717. Administrative Costs (Direct) 79,838 81,595 79,571 Administrative Costs (Indirect) 37,570 38,398 37,445. Total Costs 174,329 197,505 158,733 FTES 970 1,024 1,004 Performance measure: Percent of rural population with new or ſº- improved public safety services - Target: 5.0 5.4 5.4 Cost per Measure (unit cost) 34,865.80 36,575.00 29,395.00. Direct Community Facility - 2005 Hurricanes Emergency Supplemental, Direct Community Facility - May 6, 2007 Disaster Emergency Supplemental, Direct Community Facility - 2008 Disasters Emer. Supp., Guaranteed Community Facility - 2005 Hurricanes Emer. Supp., Guaranteed Community Facility - 2008 Disasters Emer. Supp., Community Facility Grants - 2003/2004 Hurricanes Emer. Supp., Community Facility Grants - 2005 Hurricanes Emer. Supp., Community Facility Grants - May 6, 2007 Disaster Emer. Supp., Community Facility Crants -2008 Disasters Emer. Suppl. Program Level $263,805 $741,664 $0. Budget Authority 32,231 27,537 0. Administrative Costs (Direct) 0 {} {} Administrative Costs (Indirect) 0 0 {) Total Costs 32,231 27,537 0 FTES {} () O Performance measure: Target: N/A N/A N/A Cost per Measure (unit cost) N/A N/A N/A Direct Single Family Energency Supplemental, Direct Single Family 2005 Hurricane Emergency Supplemental, Direct Single Family May 6, 2007 Disaster Emergency Supplemental Program Leveſ $67,520 $909,756 $0 Budget Authority 4,537 33,024 0. Administrative Costs (Direct) 0 {} {} Administrative Costs (Indirect) 0 {} {} Total Costs 4,537 33,024 i. {} FTES 0 {} {} Performance Iłłę3SüTê. Target: N/A N/A N/A Cost per Measure (unit cost) N/A N/A N/A Guaranteed Single Family Housing Parchase 2005 Hurricanes Fmergency Supplemental, Guaranteed Single Family Housing Purchas/Refinance Modifications 2005 Hurricanes Emergency Supplemental, Single Family Housing Purchas May 6, 2007 Disaster Emergency Supplemental (Section 502). Program Level $4,502,489 $767,46; $0 Budget Authority 19,081 11,051 {} Administrative Costs (Direct) () {} 0 Administrative Costs (Indirect) {} {} () Total Costs 19,081 1 1,051 || () FTES 0 {} 0 Performance measure: Target: N/A N/A N/A Cost per Measure (unit cost) N/A N/A N/A 455 * PROGRAM ITEMS 2009 AMOUNT 2010 AMOUNT 2011 AMOUNT {Iled SUITC. A Measure (unit - N/A Supplemental and 178 I TrleaSure: N/A COS! A A Logns Housing Repair Loans 2003/2004 Hº - Supplemental, Housing Repair Loans 2005 Hurricanes Emergency Supplemental, and { } Total Costs Measure (unit fºlò3Sūſe: Measure (unit Level 456 27–113 PROGRAM PROGRAM ITEMS 2009 AMOUNT 2010 AMOUNT 2011 AMOUNT Rental Heusing Loans, May 6, 2007, Disaster Supplemental, Rural Housing Voucher Program Disasters Emer. Suppl. MFH Revitalization Modification 2008 Disaster Emer. Suppl. MFH Rivitalisation Percent Loans 2008 Disasters Sappi, MFH Revitalization Soft Second Loans 2008 Disaster Emer. Suppl., Level - 0. Costs - 0 Costs () () Frie2S41re: N/A N/ - - Housing Grants Supplemental, Housing Repair Grants 2005 Hurricanes Emergency Supplemental, of w/ new or 457 27–114 PROGRAM PROGRAM ITEMS 2009 AMOUNT 2010 AMOUNT 2011 AMOUNT *r _($000) ($000) ($000) uaranteed Sºleºniy Housing Purchase Non-Subsidized-Simulus, Guaranteeisingle Family Hººsing Program Level $9,039,511 $1,071,449 $0. Budget Authority 113,403 15,607 {} Administrative Costs (Direct) () () {) Administrative Costs (Indirect) 0. {} () Total Costs i 13,403 15,607 0 FTEs () () () Performance measure: home purchase loans Target: 5/ 73,348 8,279 () Cost per Measure (unit cost) ł.55 1.89 0 • . . . " ' ' ' ' ' Total for Secretary's Priorities i Program Level $19,840,558 $22,228,448 $15,109, 19 Budget Authority 1,519,473 1,743,447 1,250,429 Administrative Costs (Direct) 356,577 364,427 355,386 Administrative Costs (Indirect) | 67,801 171,495 167,241 Total Costs 2,043,851 2,279,369 1,773,056 FTEs 4,331 4,569 4,484 Performance measure: Target: - N/A N/A N/A Cost per Measure (unit cost) N/A N/A N/A lſ Performance measures are currently under evaluation. 2/ The supplemental is included in P.L. 108-324 and is not included in the base program. 3/ Subsidy rate for the program not yet developed. Loan level doesn't reflect program availability. 4f FY 2008 S&E and FTE for Section 502 Direct and Section 515 Direct under evaluation. 5/Units for sec. 502 guaranteed include only loans to acquire homes, not refinance loans. * S&E and FTE figures for each program are based on calculations and a best estimate of the personnel involved. Actual staff time by program is not available at this time. ** FY 09 data based on Appropriation. Totals may not balance due to rounding. 458 2011 Explanatory Notes Rural Business-Cooperative Service Table of Contents Purpose Statement................................................................................................ Rural Business Program. Account: Appropriations Language................ … - - - - - - - - - - - - - . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Project Statement.......................... ........... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ... Justifications................................................ . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Geographic Breakdown of Obligations............................................................ Classification by Objects........................... .................................................. Rural Development Loan Fund Program Account: Appropriations Language.......................................................... ... • * * * * * * * * * * * * ... Project Statement............................................................................. e s = e s e s a s Justifications....................................................................................... * 6 s º Geographic Breakdown of Obligations............................................................ Classification by Objects................................................................ * * * * * * * * * * * * * Rural Economic Development Loans Fund Program Account: Appropriations Language............................................................................ Project Statement.............................* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *, s , s = * * * * * * * * * * * * * * * Justifications....................................................................... .................... Geographic Breakdown of Obligations................... * . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Classification by Objects.................................... -* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * Rural Economic Development Grants: Appropriations Language............................................................................ Project Statement...................................................................................... Justifications........................................................................................... Geographic Breakdown of Obligations............................................................ Classification by Objects.......... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . --- - - Rural Microenterprise Investment Program Account: Appropriations Language............................................................................ Project Statement...................................................................................... Justifications........................................................................................... Geographic Breakdown of Obligations............................................................ Classification by Objects............................................................................. Biorefinery Assistance Program Account: Appropriations Language............................................................................ Project Statement................................................................................. * e º 'º e. Justifications........................................................................................... Geographic Breakdown of Obligations............................................................ Classification by Objects............................................ tº e º e º a tº w w w w e º e i s a s a w w x * * * * * * * * * * * 459 Energy Assistance Payments: Project Statement...................................................................................... 28–50 . Geographic Breakdown of Obligations............................................................ 28-51 Classification by Objects............................................................................. 28-52 Rural Energy for America Program: Appropriations Language............................................................................ 28-53 Project Statement................................................................. . . . . . . . . . . . . . . . . . . ... 28-55 Justifications.......................................................................................... 28-57 Geographic Breakdown of Obligations............................................................ 28-58 Classification by Objects........ a s e s w w w w w = • * * * * * * * * * * * * * * * * * * * * * * v * * * * * * * * * * * * * * * s a • * * * * * * * * * * * * * * * * * 28-63 Rural Cooperative Development Grants: - Appropriations Language................................................................ a s : * * * * * * v e a 28-64 Project Statement...................................................................................... 28-66 Justifications................................................ .* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * 28-68 Geographic Breakdown of Obligations............................................................ 28–69 Classification by Objects............................................................ . . . . . . . . . . . . . . . . . 28-72 Rural Empowerment Zones and Enterprise Communities Grants: Appropriations Language.........................................…........................ 28-73 Project Statement..................................................................................... 28–74 Justifications.......................................................................................... 28–75 Geographic Breakdown of Obligations............................................................ 28–76 Classification by Objects...................................... … * - - - - - - - - - - - - - - - - - - - - - - - - - - - - - 28–77 Alternative Agriculture Research and Commercialization Corporation Revolving Fund: . Project Statement.............................................. … - - - - - - - - - 28–78 Summary of Recovery Act Funding.............. * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * 28–79 Status of Programs.................................................................................................. 28g-l Summary of Budget and Performance..................................................................... 28-82 Key Performance Outcomes and Measures............................................................... 28-85 Full Cost by Strategic Goal................................................. ................................. 28-87 460 28-1 RURAL DEVELOPMENT BUSINESS AND COOPERATIVE PROGRAMS Purpose Statement USDA Rural Development's Business and Cooperative Programs provides loans, loan guarantees, grants and payments designed to increase economic opportunity in rural America. - Authorization and Program Descriptions Business and Industry Guaranteed Loan Program (B&I) - Section. 310B of CONACT, 7 U.S.C. 1921. Access to capital is key to keeping and increasing the number and size of businesses operating in rural areas. An agency guarantee facilitates large loans in geographic areas limited by banking regulations on concentration of credit and lending limits that make large loans difficult. The guaranteed loan program supports financing for business and industrial acquisition, construction, conversion, enlargement, repair o modernization outside a town or city with a population of less than 50,000, including the urbanized area adjacent and contiguous to such town or city. Loan funds are used to finance the purchase and development of land, easements, rights-of-way, buildings, equipment, facilities, machinery, supplies and materials, and fund to pay startup costs and supply working capital. Individuals, as well as public, privat or cooperative organizations, Indian tribes, and corporations are eligible. The loan guarantee percentage drops from a maximum of 80 percent for loans of up to $5 million to 60 percent for loans between $10 million and $40 million. The aggregate loan amount available to any one borrower under this programi limited to $25 million. An exception to the limit is for cooperative organizations when the facility is located in a rural area and the facility provides value-added processing of an agricultural commodity. Th maximum amount in such cases is $40 million. - Intermediary Relending Program (IRP) - Section 1323, Food Security Act of 1985. Revolving loan programs, such as the IRP, address the lack of available credit and financial market conditions which exi; in many rural communities, especially for smaller entities, service businesses and start-up activities. These conditions often limit the ability of rural economies to create jobs, enhance amenities, and increas: incomes to enable rural families to prosper. Rural Economic Development Loans and Grants (REDLG) - Section 313 RE Act of 1936, as amended, 7 U.S.C. 940C. This program provides zero-interest loans and small grants to electric and telephone utiliti financed by the Rural Development's Utilities Programs, which, in turn, use the funding to promote sustainable rural economic development and job creation projects and to capitalize revolving loan funds for economic development and job creation purposes. Rural Business Investment Program (RBIP) — Section 6029 of the 2002 Farm Bill, P.L. 107-171. RBIP i designed to promote economic development and create wealth, job opportunities and meet the equity capital needs of smaller enterprises in rural areas. As required by statute, day-to-day management and operation of the rural business investment program is carried out by the Small Business Administration through an interagency agreement. - Rural Energy for Arnerica - Section 9007 of the 2002 Farm Bill, P.L. 107-171, as amended by the 2008 Farm Bill, P.L. 110-246. Section 9006 loan and grant programs help farmers, ranchers and rural small businesses purchase and install renewable energy systems and make energy efficiency improvements. Renewable energy projects benefit agricultural producers and rural small businesses with new and sustainable, income streams; reduced reliance on fossil fuels; and an improved environment. Energy efficiency projects also reduce the cost of production and business operations. Grants are also used for energy audits. 28-2 ural Cooperative Development Grants (RCDG) - Authorized by section 310B(e) of the Consolidated arm and Rural Development Act (7 U.S.C. 1932 (e). Regulations are found in 7 CFR part 4284, subparts A and F. RCDGs improve the economic condition of rural areas by promoting a range of cooperative development activities. Grants are made to nonprofit corporations and institutions of higher education to operate centers for cooperative development. The centers address rural economic problems in two ways. First, a center brings together expertise in cooperative development and cooperative business operations hat would otherwise be more difficult to obtain. Second, these experts in cooperative development facilitate new cooperative businesses and improve the operations of existing cooperatives through echnical assistance and educational programs. Consequently, rural cooperative development grants bromote the creation or retention of jobs in rural areas through the development of new rural cooperatives, ſalue-added processing and other rural businesses. Value-Added Agricultural Market Development Grant Program (VAPG) - Authorized by the Agricultural Risk Protection Act of 2000 and amended by Sections 6401 and 6402 of the Farm Security and Rural nvestment Act of 2002, (Farm Bill) P.L. 107-171 and the 2008 Farm Bill. Value-added agricultural arket development grants enable producers of agricultural commodities to participate in the economic eturns found in the value-added market. Grants may be used to develop business plans and develop trategies for creating marketing opportunities. Grants may also be used for feasibility studies and to rovide capital to establish alliances or business ventures allowing producers to better compete in domestic nq international markets. - Grants to Small Socially Disadvantaged Producers - Authorized and appropriated by P.L. 109–97. Grants o assist small, minority agricultural producers in rural areas provides funding for cooperatives or lssociations of cooperatives whose primary focus is to provide assistance to such producers, and whose governing board and/or membership is comprised of at least 75 percent socially disadvantaged members. Grants may be used for developing business plans, conducting feasibility studies, or developing marketing }lans for farmers, ranchers, loggers, agricultural harvesters, and fishermen. Eooperative Agreements for Research - Authorized by the Cooperative Marketing Act of 1926, (7 U.S.C. 53). Cooperative agreements are used to encourage research on critical issues vital to the development nd sustainability of cooperatives as a means of improving the quality of life in America's rural ommunities. Research proposals are solicited from institutions of higher education or nonprofit rganizations interested in applying for competitively awarded cooperative agreements for research related agricultural and nonagricultural cooperatives serving rural communities. . ooperative Education and Research Program - Authorized by the Cooperative Marketing Act of 1926, U.S.C. 453). The cooperative program conducts applied research on practical issues and problems cing cooperatives and disseminates information to farmers and the general public on dealing with these sues. A range of educational activities and materials are developed to increase public awareness of ooperative strategies that can increase rural economic activity. Research findings are disseminated ough a range of publications, such as the Rural Cooperatives magazine, the Internet, and participation in variety of research and professional organization events. echnical Assistance to Cooperatives Program - Authorized by the Cooperative Marketing Act of 1926, 7 U.S.C. 453). The cooperative program is authorized to provide advice and assistance to existing ooperatives and groups of farmers that want to form cooperatives. Technical assistance is provided Arough a network of staff at the national and State offices. Technical assistance studies are provided at the equest of a cooperative or steering committee on a no fee basis and may cover a range of business perational, organizational, financial, or developmental topics and problems. Resources to support these mportant activities are provided from the general salaries and expense account appropriated to Rural levelopment. 462 28-3 Appropriate Technology Transfer for Rural Areas (ATTRA) Program - Authorized by P.L. 104–37. ATTRA provides information to farmers and other rural users on a variety of sustainable agricultural practices that include both crop and livestock operations. The program encourages agricultural producers to adopt sustainable agricultural practices, which allow for them to maintain or improve profits, produce high quality food and reduce adverse impacts to the environment. - Rural Microenterprise Assistance Program (RMAP) - Authorized under Section 6022, of the Conservation and Energy Act of 2008. The purpose of the program is to provide loans and grants to microentrepreneurs with the skills necessary to establish new rural microenterprises and continuing technical and financial assistance related to the successful operation of rural microenterprises. Biorefinery Assistance Program — Authorized under Section 9003, of the Food, Conservation, and Energy Act of 2008. The purpose of the section is to assist in the development of new and emerging technologies for the development of advanced biofuels. The program will increase energy independence, promote resource conservation, diversify markets for agricultural and forestry products, create jobs, and enhance economic development in rural economies. - The Bioenergy Program For Advanced Biofuels - Authorized under Section 9005, of the Food, Conservation, and Energy Act of 2008 the program directs the Secretary of Agriculture to make payments to eligible producers to support and ensure an expanding production of advanced biofuels. Advanced biofuels are defined as “fuel derived from renewable biomass other than corn kernel starch” in the 2008 . Farm Bill. To receive a payment, an eligible producer shall enter into a contract with the Secretary of Agriculture for production of advanced biofuels. - - Geographic Dispersion of Offices and Employees Rural Development programs are administered by the three programs representing Rural Development: Housing and Community Facilities, Utilities, Business and Cooperative Development. Rural Developmen headquarters is located in Washington, D.C. As of September 30, 2009, there were 5,873 permanent full- time employees including the headquarters and field offices. OIG Reports OIG Audit Report No. 34099-002-AT, Business And Industry Loan Program, Omnivest Resources, Inc., Fort Gaines, Georgia (Open). - * . OIG Audit Report 34099-007–TE Request for Audit of Business and Industry Guaranteed Lender, Business Loan Express (Open). . . - . OIG Audit Report 34601-006-AT Rural Business Programs mºmediary Relending Program (Closed). OIG Audit Report No. 34601-015-TE, National Report on The B&I Loan Program (Open). ** GAO Reports - - - GAO AuditReport No. 08-1123 Collaboration between SBA and USDA Could be Improved (Open). GAO Audit Report No. 07-1005 Economic Development: Formal Monitoring Approaches Needed to Help Ensure Compliance with Restrictions (Open). - - 463 28-4 RURAL BUSINESS-COOPERATIVE SERVICE The estimates include appropriation language for this item as follows (new language underscored; deleted matter enclosed in brackets): Rural Business Program. Account (including transfer of funds) For the cost of loan guarantees and grants, for the rural business development programs authorized by sections 306 and 310B and described in section 310B(f) and 381E(d)(3) of the Consolidated Farm and Rural Development Act, [$97,116,0001881,526,000, to remain available until expended: Provided, That of the amount appropriated under this heading, not to exceed $500,000 shall be made available for a grant to a qualified national organization to provide technical assistance for rural transportation in order to promote economic developmentſ and $2,979,000 shall be for grants to the Delta Regional Authority (7 U.S.C. 2009aa et seq.) for any Rural Community Advancement Program purpose as described in section 381 E(d) of the Consolidated Farm and Rural Development Act, of which not more than 5 percent may be used for administrative expenses]: Provided further, That [$4,000,000183,010,000 of the amount appropriated under this heading shall be for business grants to benefit Federally Recognized Native American Tribes, including $250,000 for a grant to a qualified national organization to provide technical assistance for rural transportation in order to promote economic development: Provided further, That of the amount appropriated under this heading, the amount equal to the amount of Rural Business Program Account funds allocated by the Secretary for Rural Economic Area Partnership Zones for the fiscal year [2009|2010, shall be available through June 30, [2010]2011, for communities designated by the Secretary of Agriculture as Rural Economic Area Partnership Zones for the rural business and cooperative development programs described in section 381E(d)(3) of the Consolidated Farm and Rural Development Act: Provided further, That sections 381E-H and 381N of the Consolidated Farm and Rural Development Act are not applicable to funds made available under this heading: Provided further, That any prior balances in the Rural Development, Rural Community Advancement Program account for programs authorized by sections 306 and 310B and described in section 310B(f) and 381E(d)(3) of such Act be transferred and merged with this account and any other prior balances from the Rural Development, Rural Community Advancement Program account that the Secretary determines is appropriate to transfer. The first change removes the earmark for the Delta regional authority program. This program can be funded by the regular appropriation. - - The second change reflects the change of the fiscal year for the designation of set-aside for rural economic area partnership zones funds. - The third change modifies the expiration date of set-aside funds for rural economic area partnership zones from June 30, 2010, to June 30, 2011. 464 28-5 RURAL BUSINESS-COOPERATIVE SERVICE Analysis of Change in Appropriation RURAL BUSINESS PROGRAM ACCOUNT (On basis of loan level, subsidy, and grants) Loan Level Subsidy Grants Appropriations Act, 2010 aſ......................... $993,001,876 $52,927,000 $44,189,000 Budget Estimate, 2011............................... 941,962,617 40,316,000 41,210,000 Decrease in Appropriations......................... -51,039,259 -12,611,000 –2,979,000 aſ Excludes $250,000 provided by General Provision 738, P.L. 111-80. 3. PROJECT STATEMENT - CURRENT LAW (On basis of supportable loan levels and appropriated subsidies and grants) the projected use of funds, Individual columns may not add due to rounding. (In thousands of dollars) 2009 Actual 2010 Estimated - Increase or Decrease 2011 Estimated —ºiºshº Program Level Subsidy/BA |Program Level Subsidy/BA | Program Level | Subsidy/BA |Program Level Subsidy/BA Rural Business Programs: - - Business and industry guaranteed loans........... $949,010 $41,282 $993,002 $52,927 -$51,039 (1)} -$12,611 (2) $941,963 $40,316 Business and industry guaranteed loans - ARRA d/ 49,412 3,627 0 0 0 () () {} Business and industry guaranteed disaster supplemental loans aſ........................ 246,197 10,710 0 0 0 0 0 O Business and industry guaranteed - : NADBank loans aſ 0 0 0 0 () 0 0 0. Rural business enterprise grants....................... 36,053 36,053} 35,217 35,217 745 745 (3) 35,962 35,962 Rural business enterprise grants - ARRA dy.... 15,314 15,314 0 0 0 0 () () Rural business enterprise grants, technical - assistance transportation.................,,,,.... 500 500 500 500 () 0 500 500 Rural business enterprise grants, - - Mississippi delta.................................. 0 O 0 () 0 0 0 {} Rural business enterprise grants, native American tribes.................... . . . . . . . . . . . . . . . 3,360 3,360 2,760 2,760 –683 -683 (4) 2,077 2,077 Rural business enterprise grants, native - American tribes transportation................. 250 250 250 250 -62 -62 (5) 188! 188 Rural business enterprise grants, disaster - supplemental aſ g!................................ 4,810 4,810 0 O 0 0 () 0 Rural business opportunity grants.................... 1,693 1,693 1,493 1,493 245 245 (6) 1,738 1,738 Rural business opportunity grants, native American Tribes.................................. 990 990 990 990 -245 -245 (7) 745 745 Rural business opportunity grants Mississippi delta.................................. 0 0. () 0 0 () 0 0 Delta regional authority grants............. • . . . . . . . . . . . . 2,979 2,979 2,979 2,979 -2,979 –2,979 (8) 0 0 Special Earmark, GP738 - 2010................. 0 0 250| 250 ~250 -250 (9) 0 () Total Available or Estimate 1,310,567 121,567 1,037,441 97,366 -54,268 -15,840 983,173 81,526 Total adminstrative expenses - ARRA d/........... 0 4,500 () 0 0 0 0 0 Total adminstrative expenses -2008 Disasters à!.......................................... 0 750 () 0 0 0 0 () Transfer of unobligated balances................ -450,927 -25,100 () 0 () 0 0 () Recovery of prior year obligations............... -229,096 -13,633 () () 0. 0 {) () Unobligated balance available, start of year..... -143,526 -8,563 0 0 0 0 0 () Unobligated balance available, end of year... 2,287,566 157,864 {} 0 0 () 0 0 Transfer of ARRA funds d/......................... -1,737,384 -150,000 0. () 0 0 0 0 Total Appropriation...... * * * * * 1,037,200 87,385 1,037,441 97,366 :54,269 -15,840 983,173 81,526 NOTE: Amounts reflected above are budget projections of use offinds within the Rurai Business Program Account. The justification of increases and decreases is based on ; à PROJHCT STATEMENT - CURRENT LAW (On basis of obligations under available funds) (In thousands of dollars) s . 2009.Actual 2010 Estimated—— increase ºr Dººse-–2011E; mººd- ſtem of Change Program Level Subsidy/BA Program Level Subsidy/BA Program Level. Subsidy/BA Program Level Subsidy/BA Rural Business Programs: Business and industry guaranteed loans........... $949,010 $41,282 $994,575 $53,011 -$52,612 -$12,695 $941,963 $40,316 Business and industry guaranteed loans - ARRA d/ 49,412 3,627 1,523,298 122,473 -I,523.298 -122,473 0 0 Business and industry guaranteed disaster supplemental loans al......................... 246,197 10,710 163,048 8,690 -163,048 -8,690 0 0 Business and industry guaranteed - MADBank loans aſ q 0 {} 4,412 35] -4,412 -351 {} Q Rural business enterprise grants....................... 36,053 36,053 35,998 35,998 –781 -781 35,217 35,217 Rural business enterprise grants - ARRA d!..... 15,314 15,314 4,086 4,086 -4,086 -4,086 () . {) Rural business enterprise grants, technical assistance transportation......................... 500 500 502 502 -2 –2 500 500 Rural business enterprise grants, Mississippi delta.................................. () 0 299 299 –299 -299 0. {} Rural business enterprise grants, native American tribes................................... 3,360 3,360 3,459 3,459 -1,383 -1,383 2,077 2,077 Rural business enterprise grants, native American tribes transportation.................. 250 250 250 250 -62 -62 188 188 Rural business enterprise grants, disaster supplemental aſ g|................................. 4,810 4,810 140 140 -140 , -140 () 0 Rural business opportunity grants..................... 1,693 1,693 1,639 1,639 99 99 1,738 1,738 Rural business opportunity grants, native American Tribes.................................. 990 990 999 999 -254 -254 745 745 Rural business opportunity grants Mississippi delta.........................---. . . . . . () 0 32 32 -32 -32 0 0 Delta regiónal authority grants......................... 2,979 2,979 2,979 2,979]. –2,979 -2,979 () () Special Earmark, GP 764 - 2006................. Ö 0 l 1 -1 -1 0. 0 Special Bamark, GP 738 - 2010................. 0 0. 250 250 -250 :250 0 0 Total Available or Estimate 1,310,567 121,567 2,735,967 235,160 -1,753,539 -154,379 982,428 80,781 Total adminstrative expenses - ARRA d!........... 0 4,500 () 0 0 {} 0 0 Total adminstrative expenses -2008 Disasters aſ........................................... 0 750 0. () 0 {} 0 {) Transfer of unobligated balances.................. -450,927 –25,100 () () () {} () {} Recovery of prior year obligations............... -229,096 -13,633 0 {} () {) {} () Unobligated balance available, start of year..... -143,526 -8,563 –2,034,169 -157,864 1,565,244 137,794 -468,925 –20,070 Unobligated balance available, end of year... 2,287,566 157,864 335,643 20,070 -335,643 -20,070 0 () Transfer of ARRA funds d/........................... -1,737,384 -150,000 0 0. () Ö 0 0 Rescission eſ 0 () 0 0. 468,925 20,070 468,925 20,070 Total Appropriation…] 1,037,200 87,385 1,037,441 97,366 –55,013 -16,585 982,428 80,781 NOTE: Amounts reflected above are budget projections of use offinds within the Rural Business the projected use of funds. Individual columns may not add due to rounding. Program. Account. The justification of increases and decreases is based on # 467 28-8 Footnotes: d/ Transfers from the Rural Development Disaster Assistance Fund provided by the Consolidated Security, Disaster Assistance, and Continuing Appropriations Act, 2009, P.L. 1 10-329, signed September 30, 2008, for disasters during calendar year 2008 in the amount of $150 million. The North American Free Trade Agreement Implementation Act, P.L. 103-182, 107 Stat. 2057, authorizes the Rural Business-Cooperative Service to accept offsetting collections from the United States Commodity Adjustment and Investment Program for the purpose of making NADBank guaranteed business and industry loans. In FY 2010, an unobligated carryover balance of $351,233.36 was available for this purpose. The FY 2010 loan subsidy rate is 7.96 percent. Provided by the U.S. Troop Readiness, Veterans' Care, Katrina Recovery, and Iraq Accountability Appropriations Act, 2007, P.L. 110–28, signed May 25, 2007, for areas in Kansas hit by the tornadoes on May 6, 2007, and unobligated balances in the amount of $100,000 from the funds provided in P.L. 110-28 transferred to rural business enterprise grants in FY 2009. Provided by the American Recovery and Reinvestment Act of 2009, P.L. 111-5, signed February 17, 2009, for the purpose of making supplemental appropriations for job preservation and creation, infrastructure investment, energy efficiency and science, assistance to the unemployed, and State and local fiscal stabilization. The funds are available through the fiscal year ending September 30, 2010. The proposed rescission is of carryover balances of regular funds not anticipated being obligated in FY 2010. 468 (1) (2) (3 } (4) 28-9 JUSTIFICATION OF INCREASES AND DECREASES A decrease of $51,039,059 for the guaranteed business and industry loan level ($993,001.87 6 available in 2010). - The business and industry guaranteed loan program has a projected carryover of FY 2010 funds of $415 million. It is therefore anticipated that the requested program level of $941.6 million in addition to the carryover will be sufficient to meet the demand for the program in FY 2011. The guaranteed business and industry loan level promotes the creation of rural businesses; secures start-up capital; and finances for expansion, creates jobs, and helps diversify the rural economy. This investment will provide increased employment opportunities for rural communities and upgrade community infrastructure to improve the quality of life for rural residents. The agency strives to improve the quality of life in rural America by encouraging the establishment and growth of rural businesses and cooperatives, which ultimately increases the availability, stability, and quality of jobs in rural America. The agency also strives to expand economic and trade opportunities for agricultural producers and other rural residents and build leveraging partnerships with State, local and private sources to expand the total amount of resources provided to rural areas. The increase of funds will be used to support the Healthy Food, Healthy Neighborhoods and Regional Innovation Initiatives. The Healthy Food, Healthy Neighborhoods initiative will support local and regional efforts to increase access to health food, in particular for developing grocery stores and other health food retailers in urban and rural food deserts and other low-income/underserved areas in coordination with other Agencies. In addition, the new Regional Innovation Initiative focuses planning and coordination of USDA and other sources of assistance for rural communities, allowing for communities with the same region working together instead of independently produce more prosperity for all communities"involved. A decrease of $12,61 1,000 for guaranteed business and industry loan subsidy ($52,927,000 available in 2010). - .. - The change in the subsidy rate is primarily due to changes in technical assumptions such as defaults and recoveries and the increase in the estimated Treasury discount rate for these programs. In addition, there is a proposed fee restructuring of a 1 percent increase to the fee to take place in FY 2011 which also lowers the subsidy rate. - An increase of $744,975 for the rural business enterprise grants ($35,217,000 available in 2010). This increase represents funding needs. The amount of funds available for all rural business enterprise grants remains constant but there is an increase to the regular program. A portion of the funds previously specifically targeted to Native American rural business enterprise grants programs have been redirected to the regular program. Obligations for Native Americans can still take place under the regular program keeping the available funding for Native Americans. - A decrease of $683,100 for the rural business enterprise Native American tribes grants ($2,760,000 available in 2010). - - The reduction reflects funding needs. The program is being funded at a decreased amount from prior years yet obligations can still take place under the regular program keeping the available funding for the program. - 469 (5) (6). (7) (8) (9) 28-10 A decrease of $61,875 for the rural business enterprise Native American tribes passenger transportation grants ($250,000 available in 2010). The reduction reflects funding needs. The program is being funded at a decreased amount from prior years yet obligations can still take place under the regular program keeping the available funding for the program, An increase of $245,025 for the rural business opportunity grants ($1,493,000 available in 2010). This increase represents funding needs. The amount of funds available for all rural business opportunity grants remains constant but there is an increase to the regular program. A portion of the funds previously specifically targeted to Native American rural business opportunity grants programs have been redirected to the regular program. Obligations for Native Americans can still take place under the regular program keeping the available funding for Native Americans. A decrease of $245,025 for the rural business opportunity Native American tribes grants ($990,000 available in 2010). The reduction reflects funding needs. The program is being funded at a decreased amount from prior years yet obligations can still take place under the regular program keeping the available funding for the program. A decrease of $2,979,000 for the delta regional authority grants ($2,979,000 available in 2010). This program is duplicative; other programs are available which provide similar services and may be more effective. Therefore, the program is zeroed out for FY 2011. A decrease of $250,000 in the special earmark grants ($250,000 available in 2010). The budget does not propose funding specifically earmarked projects. 470 28-11 RURAL BUSINESS-COOPERATIVE SERVICE {350GRAPHC BíčEAKDOWN OF OBājūATIONS 2009 Actual and Estimated 2010 and 2011 Business and Industry Loan Program- Guaranteed 2009 2010 2011 Alabama $2,400,000 $22,680,000 $16,503,000 Alaska 24,268,750 7,358,000 8,842,000 Arizona 18,832,680 13,986,000 12,156,000 Arkansas 1,350,000 #6,633,000 13,479,000 California 77,483,320 23,985,000 17,156,000 Colorado #9,566,500 1 1,706,000 11,016,000 Connecticut 1,800,000 7,998,000 9,162,000 Delaware 2,153,627 6,507,000 8,417,000 Florida 39,366,700 23,429,000 16,878,000 Georgia. 53,534,035 28,892,000 tS,609,000 Hawaii 9,913,000 6,754,000 8,545,000 Idaho 29,303,739 9,295,000 9,811,000 Illinois 18.987,750 19,737,000 i5,032,000 Indiana 14.350,633 2. 20,210,000 15,268,000 Howa 47,594,123 14,031,000 ł2,178,000 Kansas 6,670,000 10,970,000 10,647,000 Kentucky 12,256,000 23,333,000 16,829,000 Louisiana 4,816,500 16, 17,000 13,221,000 Maine 2,615,000 ! i.343,000 10,834,000 Maryland 1,305,000 16,001,000 10,163,000 Massachusetts 6,050,000 7,848,000 9,087.000 Michigan 11,961,900 28,295,000 19,311,000 Minnesota 14,365,000 t?,349,000 13.338,000 Mississippi * 20,887,000 15,606,000 Missouri ii.193,000 20,467,000 15,397,000 Montana 19,361,000 9,110,000 9,718,000 Nebraska 9,963,523 9,228,000 9,777,000 Nevada ** 8,432,000 9,379,000 New Hampshire * 8,604,000 9,465,000 New Jersey *. 7,304,000 9,065,000 New Mexico 9,954.120 9,5}2,000 9,919,000 New York 26,750,675 22,727,000 16,526,000 North Carolina 32,993,800 31,470,000 20,897,000 North Dakota 17,537,000 7,162,000 8,714,000 Ohio 36,165,000 27,736,000 19,055,000 Oklahoma 30,630,000 15,382,000 12,854,000 Oregon 29,247,216 12,407,000 11.366,000 Pennsylvania 54,113,900 26,315,000 18.321,000 Rhode Island ~. 5,446,000 7,886,000 South Carolina 44,021436. 21,075,000 15,701,000 South Dakota 6,488,250 8,094,000 9,210,000 Tennessee #6,922,534 25,474,000 17,899,000 Texas 40,145,965 31,470,000 20,898,000 Utah 8,595,255 7,670,000 8,998,000 Vermont 243,750 8,240,000 9,283,000 Virginia 12,170,500 29,335,000 15,331,000 Washington 13,514,500 14,258,000 #2,292,000 West Virginia 16,689,000 12,562,000 11,443,000 Wisconsin 79,320,059 . 18,560,000 14,443,000 Wyoming 5,468,000 6,536,000 8,431,000 Puerto Rico. * 8,982,000 9,654,000 Virgin Islands 10,000,000 5,000,000 7,663,000 W. Pacific Areas 5,000,000 5,000,000 7,663,000 Ondistributed *** 200,172,211 271,127,000 Total Avail./Est. $949,009,927 $994,575,211 $941 1963,000, NADBank Business and Industry Loan Program - Guaranteed 2009 2010 2013 Totai Avail/Est tº $4,412,479 H *sº Al Cannot be distributed by geographic area in advance. RURAL BUSINESS-COOPERATIVE SERVICE GEOGRAPHICBREAKDOWN OF OBLIGATIONS 2009 Actual and Estimated 2010 and 2011 Business and Industry Loan Program - Guaranteed - Recovery Act 1/ 2009 2010 Connecticut $650,000 tº see Illinois 1,590,000 we s-à Kansas 700,000 * * Kentucky 5,000,000 * * Louisiana 2,200,000 gºyº, Maine 1,750,000 sº º Minnesota 5,000,000 ** Ohio 6,129,700 wºsº. South Carolina 3,000,000 *** Wisconsin 23,392,000 wn wº Total Avail./Est. $49,41 1,700 $1,523,298,274 1/ Cannot be distributed by geographic area in advance, 472 California Georgia Idaho Illinois Iowa Louisiana Maine . . Massachusetts Mississippi - Missouri Nebraska New Hampshire New Mexico North Dakota Ohio Oklahoma Oregon South Dakota Texas . . Vermont Washington Wisconsin Virgin Islands Total Avail./Est. ‘y Aſſºw 8-|3 RURAL BUSINESS-COOPERATIVE SERVICE GEOGRAPHIC BREAKDOWN OF OBLIGATIONS 2009 Actual and Estimated 2010 and 2011 Business and Industry Loan Program Guaranteed 2008 Disasters 2009 $18,333,000 4,500,000 6,396,600 4,000,000 31,500,000 39,936,000 600,000 8,512,500. 4,000,000 25,462,000 2,030,000 4,500,000 525,000 850,000 1,655,022. 35,695,000 6,029,900 150,000 10,454,000 964,510 6,953,000 30,700,000 _2,450,000 $246,196,532 2010 **** $163,047,859 1/ 1/ Cannot be distributed by geographic area in advance. 473 Alabama. Alaska Arizona Arkansas California Colorado Connecticut Delaware Florida Georgia Hawaii Idaho illinois Indiana Howa Kansas Kentucky Louisiana Maine Maryland Massachusetts Michigan Minnesota Mississippi Missouri Montana Nebraska Nevada New Hampshire New Jersey New Mexico New York North Carolina North Dakota Chio Oklahoma Oregon Pennsylvania Rhode Island South Carolina South Dakota Tennessee Texas Utah Vermont Virginia Washington West Virginia Wisconsin Wyoming Puerto Rico Virgin Islands W. Pacific Area Undistributed Total Avail./Est. 28-14 RURAL BUSINESS-COOPERATIVE SERVICE GEOGRAPHICBREAKDOWN OF OBLIGATIONS 2009 Actual and Estimated 2010 and 2011 Rural Business Enterprise Grants 2009 2010 2014 $762,540 $978,000 $893,000 660,023 174,000 163,000 638,211 522,000 479,000 916,380 660,000 604,000 2,709,861 1,046,000 955,000 366,050 402,000. 370,000 151,960 207,000 193,000 103,790 129,000 122,000 765,605 1,017,000 929,000 1,495,668 1,304,000 1,190,000 482,668 143,000 134,000 292,871 275,000 254,000 1,224,234 323,000 753,000 594,880 848,000 775,000 537,740 524,000 481,000 456,570 363,000 334,000 1,403,237 i.012,000 924,000 577,031 633,000 530,000 3,096,603 383,000 353,000 1,479,300 312,000 283,000 254,380 199,000 185,000 i,258,670 1,272,000 1,161,000 891,770 698,000 639,000 679,404 884,000 808,000 1,017,850 862,000 788,000 280,379 266,000 246,000 600, 139 272,000 252,000 i20,000 230,000 213,000 204,500 239,000 222,000 I62,340 197,000 184,000 256,300 287,000 265,000 i, 77,530 980,000 895,000 1,072,310 1,439,000 1,313,000 486,741 160,000 150,000 964,830 1,246,000 1,137,000 921,550 595,000 545,000 793,869 439,000 404,000 912,030 1,169,000 1,067,000 90,010 ' 73,000 125,000 725,759 894,000 817,000 516, 197 212,000 197,000 981,650 1,124,000 1,026,000 1,842,310 1,439,000 1,313,000 234,430 190,000 177,000 1,206,178 220,000 204,000 776,860 855,000 782,000 418, 110 536,000 492,000 744,630 447,000 41 1,000 1, 198,777 762,000 697,000 111,560 131,000 124,000 786,310 259,000 240,000 * * 50,000 104,000 60,000 50,000 104,000 * 10,078,525 10,666,000 $40,162,595 $40,509,525 $38,727,000 474 28-15 RURAL BUSINESS.CCOPERATIVE SERVICE GEOGRAPHIC BREAKDown OF OBLIGATIONS 2009 Actual and Estimated 2010 and 2011 Rural Business Enterprise Grants - Recovery Act 2009 2010 2011 Alabama r $100,000 ** sºrse Alaska 71,000 - ** -- Arizona 30,000 sº * Arkansas 96,400 s ºf vº; California 80,000 egº -- Connecticut 60,620 tº º ºlº Delaware 41,000 -- *ººs Georgia - 1,960,007 ** * Idaho 9,000 assº. ºngº Illinois 178,650 **g wº. Iowa . 441.999 ** *-*. Kansas 95.000 . | -- - **. Kentucky - 765,000 ** £º Louisiana 189,332 tº ºr ** Maine 378,000 ** wº, Maryland 173,038 •ººs & ºr Massachusetts 75,000 *** tº tº Michigan 90,000 as ºf * Minnesota 871,382 saw; tºgº Mississippi 99,990 *sº. *º Missouri 331,350 •º gº * . Montana 113,574 was my tº-ſº Nebraska 147,800 ** s Fººt Nevada 108,373 *-ºº: º: New Hampshire 46,000 -º-º: tº-º New Jersey 99,000 º **- New Mexico 977,750 sº ** New York 184,000 *º-ºg * North Carolina 225,000 * ºf gºsº North Dakota 181,000 tºº ** Ohio 697,999 . west ** Oklahoma 886,749 . *_*- sº Oregon 622,802 . sº tº ** Pennsylvania 199,490 sº gº ** South Carolina 1,022,361 *sº * South Dakota 425,583 *es fºrº Tennessee 623,499 -ºº: *:- Texas 1,200,000 iºsº **t Utah 99,900 wº-ºº: **** Vermont 65,000 tº º º-s Virginia 436,600 sº tºº, Washington 88,873 *** ** West Virginia * 200,000 * * grº Wisconsin 295.799 * * ** Wyoming 60,000 ** 4 rº Puerto Rico 50,000 *sº wº W. Pacific Areas . 115,000 ** sºgºs Total Avail./Est. $15,314,425 . $4,085,575 I/ ** := :=: == lſ Cannot be distributed by geographic area in advance. 475 28-16 RURAL BUSINESS-COOPERATIVE SERVICE GEOGRAPHICBREAKDOWN OF OBLIGATIONS 2009 Actual and Estimated 2010 and 20 i ! Rural Business Enterprise Grants 2007 Tornados Disasters 2009 2010 2011 Kansas $100,000 ** six- Total Avail./Est. $100,000 *- - -- Rural Business Enterprise Grants 2008 Disasters 2009 2010 2011 Arkansas $456,939 * * * * Illinois 237,500 -- gº º- Iowa 248,810 — - tº º Louisiana 373,275 nºw ºf dº ſº Maine 234,800 masº *º Massachusetts 136,719 wº- ſº-º-º: Minnesota 184,437 *ºtº- enem New Hampshire 510,317 wº-ºº: tº-º- Oregon 449,998 ºws: ~~ Tennessee 146,000 ** Ex ºn Vermont 752,499 tº sº. -- Washington 464,045 ºr ºf ºº: West Virginia 394,000 * ºr * ºf ºr Wisconsin 120,560 tº sº. tºiºs Total Avail./Est, $4,709,899 $140,101 1/ ** Aſ Cannot be distributed by geographic area in advance. 476 1/ 23-17 RURAL BUSINESS-COOPERATIVE SERVICE GEOGRAPHIC BREAKDOWN OF OBLIGATIONS 2009 Actual and Estimated 2010 and 2011 Rural Business Opportunity Grants ** wº- º amme 2009 2010 Arizona $99,750 tº ºve Arkansas 50,000 * * California 38,563 wºn mas Colorado 150,000 tº wº Connecticut 200,000 ** Illinois 100,000 --> Indiana 50,000 ºr ºf Iowa 49,999 tº wº Maine 276,422 * -º Montana 125,516 ** New Mexico 50,000 tº sº. New York 50,000 tº gº North Dakota . . 112,100 &ºº Oklahoma 249,866 * tº Oregon 210,000 mºm, South Dakota 137,000 gº tº Tennessee 50,000 smus ºf Utah 72,623 was agº; Vermont 370,000 tº sº Washington 89,000 Mº tº Wisconsin 51,789 * * Puerto Rico 50,000 *sº W. Pacific Areas 50,000 * * Total Avail./Est, $2,682,628 $2,670,012 1/ . Cannot be distributed by geographic area in advance. $2,483,000 1/ 477 28-18 RURAL BUSINESS-COOPERATIVE SERVICE GEOGRAPHIC BREAKDOWN OF OBLIGATIONS 2009 Actual and Estimated 2010 and 2011 Delta Regional Authority Grants 2009 201 Mississippi $2,979,000 ºr sº Total Avail./Est. . $2,979,000 $2,979,000 1/ Rural Business Special Earmark GP 764-2006 200 2010 Total Avail./Est. - $500 11 Rural Business Special Earmark GP 738 - 2010 2009 201 Total Avail./Est. * ºn $250,000 1/ () 2 ! *-*s Cannot be distributed by geographic area in advance. 478 28-19 RURAL BUSINESS-COOPERATIVE SERVICE RURAL BUSINESS PROGRAM ACCOUNT Classification by Objects 2009 Actual and Estimated 2010 and 2011 FY 2009 FY 2010 FY 2011 Other Objects:. 25 other purchases of goods and services from government accounts.................. $5,250,000 $0 $0 41 Grants, subsidies, and contributions......... ‘. . . . 121,566,847 235,230,437 81,526,000 Total direct obligations.............................. 126,816,847 235,230,437 81,526,000 479 28-20 RURAL BUSINESS-COOPERATIVE SERVICE The estimates include appropriation language for this item as follows (new language underscored; deleted natter enclosed in brackets): - - tural Development Loan Fund Program Account (including transfer of funds) For the principal amount of direct loans, as authorized by the Rural Development Loan Fund (42 U.S.C.9812(a)), [$33,536,0001836,376,000. For the cost of direct loans, [$8,464,0001814,034,000, as authorized by the Rural Development Loan Fund (42 U.S.C. 9812(a)), of which $1,035,000 shall be available through June 30, [2010]2011, for Federally Recognized Native American Tribes and of which $2,070,000 shall be . available through June 30, [2010]2011, for Mississippi Delta Region counties (as determined in accordance with Public Law 100-460): Provided, That such costs, including the cost of modifying such loans, shall be as defined in section 502 of the Congressional Budget Act of 1974: Provided further, That of the total amount appropriated under this heading, the amount equal to the amount of Rural Development Loan Fund Program. Account funds allocated by the Secretary for Rural Economic Area Partnership Zones for the fiscal year [2009|2010, shall be available through June 30, [2010]2011, for communities designated by the Secretary of Agriculture as Rural Economic Area Partnership Zones. - In addition, for administrative expenses to carry out the direct loan programs, [$4,941,000/$5,046,000 shall be ſtransferred to and merged with]paid to the appropriation for “Rural Development, Salaries and Expenses”. e first change modifies the expiration date of set-aside funds for Federally Recognized Native American 'ribes from June 30, 2010, to June 30, 2011. , - he second change modifies the expiration date of set-aside funds for Mississippi Delta Region counties rom June 30, 2010, to June 30, 201 1. he third change reflects the change of the fiscal year for the designation of set-aside for Rural Economic rea Partnership Zones funds. he fourth change modifies the expiration date of set-aside funds for Rural Economic Area Partnership ones from June 30, 2010, to June 30, 2011. he fifth change reflects language simplifying the transfer and consolidation of funds from the individually propriated administrative expense account to the Rural Development, Salaries and Expense account. 480 28-2} RURAL BUSINESS-COOPERATIVE SERVICE Analysis of Change in Appropriation RURAL DEVELOPMENT LOAN FUND PROGRAM ACCOUNT (On basis of supportable loan level, appropriated subsidy and administrative expenses) Administrativ Loan Level Subsidy. Expenses Appropriations Act, 2010..................................... $33,536,000 $8,464,000 $4,941,00 Budget Estimate, 2011....................................... 36,376,361 14,034,000 5,046,00 Increase in Appropriations.................................... 2,840,361 5,570,000 105,00ſ 5. PROJECT STATEMENT (On basis of appropriated loan levels, subsidy and administrative expenses) (In thousands of dollars) 2009 Actual 2010 Estimated Increase or Decrease 2011 Estimated Program Subsidy/ Program Subsidy/ Program Subsidy/ Program Subsidy/ Item of Change Level BA Level BA Level BA Level BA Intermediary Relending Program º Loans..................................... $33,536 $14,035 $33,536 $8,464 $2,840 (i) $5,570 (2) $36,376 $14,034 Total loans and Subsidies................. 33,536 14,035 33,536 8,464 2,840 5,570 36,376 14,034 Total Administrative expenses aſ........ () 4,853 0 4,941 0. 105 (3) () 5,046 Total Available or Estimate.............. 33,536 18,888 33,536 13,405 2,840 5,675 36,376 19,080 Total Appropriation........................ 33,536 18,888 33,536 13,405 2,840 5,675 36,376 19,080 Staff-years are reflected in the Salaries and Expenses Project Statement. aſ In FY 2009, funding of $4,853,000 was appropriated and transferred to the Rural Development Salaries and Expenses account. In FY 2010, funding of $4,941,000 was paid to the Rural Development Salaries and Expenses account. In FY 2011, $5,046,000 is requested and will be paid to the Rural Development Salaries and Expenses account. g 482 (1) (2) (3) 28-23 JUSTIFICATION OF INCREASES An increase of $2,840,000 in the intermediary relending direct loan level ($33,534,073 available in 2010). Under this program funds are loaned directly to intermediaries, which, in turn, provide loans to financ rural business facilities and community development projects. Eligible intermediaries include public bodies, nonprofit corporations, Indian tribes and cooperatives. The increase of funds will be used to support the Healthy Food, Healthy Neighborhoods and Regional Innovation Initiatives. The Healthy Food, Healthy Neighborhoods initiative will support local and regional efforts to increase access to health food, in particular for developing grocery stores and other health food retailers in urban and rural food deserts and other low-income/underserved areas in coordination with other Agencies. In addition, the new Regional Innovation Initiative focuses planning and coordination of USDA and othe sources of assistance for rural communities, allowing for communities with the same region working together instead of independently produce more prosperity for all communities involved. An increase of $5,570,000 in the intermediary relending direct loan subsidy ($8,464,000 available in 2010). This increase in budget authority is required to support the loan level requested for FY 2011. A majority of the increase is due to the change in the subsidy rate because of the increase in the estimat Treasury discount rate for these programs. An increase of $105,000 for administrative expenses ($4,941,000 available in 2010). Justification for administrative expenses in the amount of $5,046,000 and the associated staff-years a reflected in the Rural Development Salaries and Expenses Project Statement. 483 Alabama Arkansas California Colorado Delaware Georgia Idaho Illinois Howa Kentucky Maine Maryland Massachusetts Missouri Mºntana New Jersey New York North Carolina North Dakota Qklahoma Oregon Pennsylvania South Carolina South Dakota Texas Vermont West Virginia W Pacific Areas Total Avail./Est. 28–24 RURAL BUSINESS-COOPERATIVE SERVICE GEOGRAPHIC BREAKDOWN OF OBLIGATIONS 2009 Actual and Estimated 2010 and 2011 Intermediary Relending Program Loans 2009 2010 $500,000 tº ºn 400,000 rºº 3,750,000 sº tº 750,000 **º 500,000 * * 750,000 * * 300,000 gº ºf 2,500,000 wºº 728,219 Iº Dºh 750,000 | -- 750,000 *w 1,500,000 gº ºs 750,000 tºrºss 500,000 wºº ºn 1,335,000 - * tº 750,000 gº º 1,050,000 ** 3,000,000 gº tº 1,350,000 &º gº 750,000 -- 1,050,000 tºº 995,000 fºliº 1,828,219 tºrº , 1,500,000 army. 1,500,000 tº sº. 2,500,000 **gº 750,000 wº, ºr 750,000 fºº. $33,536,438 $31,431,325 1/ / Cannot be distributed by geographic area in advance. * * ** _$36,379,999.1/ 484 28-25 RURAL BUSINESS-COOPERATIVE SERVICE RURAL DEVELOPMENT LOAN FUND PROGRAM ACCOUNT Classification by Objects 2009 Actual and Estimated 2010 and 2011 FY 2009 FY 2010 FY 2011 Other Objects: 25 Other purchases of goods and services from government accounts................ 'º. 4, 4 e $4,853,000 $4,941,000 $5,046,00 41 Grants, subsidies, and contributions.................. 14,035,000 8,464,000 14,034,00 Total direct obligations - i 18,888,000 13,405,000 19,080,00 485 28–26 RURAL BUSINESS-COOPERATIVE SERVICE he estimates include appropriation language for this item as follows (new language underscored; deleted latter enclosed in brackets): ural Economic Development Loans Program Account (Including [Rescission]Cancellation Of Funds) For the principal amount of direct loans, as authorized under section 313 of the Rural Electrification Act, for the purpose of promoting rural economic development and job creation projects, $33,077,000. Of the funds derived from interest on the cushion of credit payments, as authorized by section 313 of the Rural Electrification Act of 1936, [$44,463,000]$103,000,000 shall not be obligated and [$44,463,00018103,000,000 are [rescindedjhereby permanently cancelled. his change reflects a rescission of the interest on the cushion of credit funds. 486 28-27 RURAL BUSINESS-COOPERATIVE SERVICE Analysis of Change in Appropriation RURAL ECONOMIC DEVELOPMENT LOANS PROGRAM ACCOUNT (On basis of loan level and subsidy) Loan Level Subsidy Appropriations Act, 2010................................... . . . . . . . . . . $33,077,000 $ſ Budget Estimate, 2011... w & © tº & 33,077,000 ! No Change in Appropriations..................................... - 0 - – § retre+srºrcºrrºr– (On basis of supportable loan levels and appropriated subsidy) (In thousands of dollars) 2009 Actual 2010 Estimated Increase or Decrease 2011 Estimated | Loan | Subsidy/ Loan Subsidy/ Loan Subsidy/ Loan Subsidy/ Item of Change Level BA Level BA Level BA Level BA Rural economic development direct loans....... $36,171 $7,556 $33,077] $4,317 $0 $1,607 (l $33,077| $5,924 Total Available or Estimate........................ 36,171 7,556 33,077 4,317 0 1,607 33,077 5,924 Recovery of prior year obligations................ -4,468 –3,526 0 0 0 () () 0. Unobligated balance available, start of year..... -1,747 -365 0 0 0 () 0 () Unobligated balance available, end of year.....: 3,121 652 0 0. 0 0 0 0 Offsetting collections paid from Rural - - - Economic Grants account...................... ..! -33,077 -4,317 –33,077 -4,317 0 -1,607 -33,077 -5,924 Total Appropriation................................. 0 0 0 0 0 0. 0 () Staff years are reflected in the Salaries and Expenses Project Statement. Note: Program is funded by the cushion of credit account. PROJECT STATEMENT (On basis of available loan levels and subsidy) (In thousands of dollars) 2009 Actual 2010 Estimated Increase or Decrease 2011 Estimated Loan Subsidy/ Loan Subsidy/ Loan Subsidy/ Loan Subsidy/ Item of Change Level BA Level BA Level BA Level BA Rural economic development direct loans....... $36,171 $7,556 $38,074 $4,969 -$4,997 $955 $33,077 $5,924 Total Available or Estimate........................ 36,171 7,556 38,074 4,969 –4,997 955 33,077 5,924 Recovery of prior year obligations................ -4,468 -3,526 O {} 0 {} {} 0 Unobligated balance available, start of year..... -1,747 –365 –4,997 -652 4,997 652 0 0. Unobligated balance available, end of year...... 3,121 652 0| 0 0. 0 0 0 Offsetting collections paid from Rural - Economic Grants account........................ -33,077 -4,317 –33,077 -4,317 0 -1,607 –33,077 –5,924 Total Appropriation................................. {} 0 0 0 0 {} {} {} Staff years are reflected in the Salaries and Expenses Project Statement. Note: Program is funded by the cushion of credit account. : 488 28-29 JUSTIFICATION OF INCREASE (1) An increase of $1,607,542 in the rural economic development loan subsidy ($4,316,549 available i 2010). - There is no request for budget authority for this program because the program is funded from the cushion of credit account. The requested subsidy supports the estimated loan obligations associate with the requested FY 2011 loan level for this program. The change is due to an increase in the subsidy rate in FY 2011. - - 489 23 –3{} RURAL BUSINESS-COOPERATIVE SERVICE GEOGRAPHICBREAKDOWN OF OBLIGATIONS 2009 Actual and Estimated 2010 and 2011 Rural Economic Development Loans Cannot be distributed by geographic area in advance. 2009 2010 2011 Alabama $850,000 * * sº º Georgia 3,610,000 gº tº ~~ Illinois . 1,480,000 * * wº, sº Indiana - 740,000 * * º Iowa 2,085,250 -- - was º Kansas 7,248,400 ** ºtº Kentucky 1,620,000 * - xºgº Minnesota 3,427,360 sºº zºº Mississippi 3,700,000 -- ** Missouri 1,040,000 ** ºn tº North Dakota 740,000 *.* tº sº. Oklahoma 400,000 ** -* tº South Carolina 2,127,360 sº sº. -º-º-º: South Dakota 740,000 * - ** Tennessee 5,883,000 Jº tº ºn tº Virginia 480,000 * * - tºº. Total Avail./Est. $36,171,370 $38,073,726 l/ $33,077,000 1/ 490 28–31 RURAL BUSINESS-COOPERATIVE SERVICE RURAL ECONOMIC DEVELOPMENT LOANS PROGRAMACCOUNT Classification by Objects 2009 Actual and Estimated 2010 and 2011 FY 2009 FY 2010 FY 2011 Other Objects: 41 Grants, subsidies, and contributions.......... $7,556,199 - $4,968,622 $5,924.0% Total direct obligations tº gº tº G & © tº º & 7,556,199 4,968,622 5,924,04 491 28-32 RURAL Business cooperative SERVICE Analysis of cºme in Appropriation RURAL ECONOMIC DEVELOPMENT GRANTS \ppropriations Act, *~ -$44,463,000 łudget Estimate, 2011........................................................................................... -103,000,000 ncrease in Rescission.................................................................... • - - - - - - - - - - - - * * * * -58,537,000 Analysis of Change in Funding RURAL ECONOMIC DEVELOPMENT GRANTS . stimate, 2010......~~~~…...…....…..................... $10,000,000 udget Estimate, 2011.................................…......…..................................... 10,000,000 o Change in Program............................................................................. {} 492 28–33 PROJECT STATEMENT (On basis of obligations under available funds) 2009 . 2010 Increase or 2011 Item of Change Actual Estimated Decrease Estimated Rural economic development grant... $9,914,156H $10,000,000 $0 $10,000,000 Total Available or Estimate............ 9,914,156 10,000,000 0 10,000,000 Unobligated balance available, - start of year............................ -7,671,147 -85,844 -30,039,451 –30,125,295 Recovery of prior year obligations...} 14,192,217 0. 0 - 0 Transfer from Rural Electrification and Telecommunications Liquidating Account, Cushion - of Credit1............................. -36,029,039 -80,819,000 0 -80,819,000 Transfer from Rural Electrification and Telecommunications electric underwriter loan fees....... -7,964,125 -8,000,000 0 -8,000,000 Offsetting collections paid to - Rural Economic Development Program Account..................... 7,472,094 4,316,549 1,607,542 5,924,091 Unobligated balance available, - . . . end of year............................. 85,844; 30,125,295 -30,105,091 20,20 Total Appropriation..................... –20,000,000 -44,463,000 -58,537,000 (1) -103,000,000 on of credit 1/ Amounts represent earnings generated by the interest differential on voluntary cushi payments made by Rural Utilities Service borrowers. 493 28–34 JUSTIFICATION OF INCREASE ºn increase of $58,537,000 in the rural economic development grants rescission (-$44,463,000 was ascinded in 2010). his budget includes a rescission of interest in the cushion of credit not needed to fund program costs. 494 28-35 RURAL BUSINESS-COOPERATIVE SERVICE GEOGRAPHIC BREAKDOWN OF OBLIGATIONS 2009 Actual and Estimated 2010 and 2011 Rural Economic Development Grants - 2009 2010 2011 Colorado $300,000 gº º * * Georgia 600,000 -- tºº Iowa 2,990,000 sº ſº ºft Kansas 471,156 tºº tº sº. Kentucky 600,000 ** , * @º Minnesota 250,000 • •- - tºº Mississippi 300,000 - tºº *sºn Nebraska 300,000 ** gº tº North Dakota 600,000 -- tºº South Carolina 900,000 - * ſº -- South Dakota 900,000 sº tº -- Tennessee * - wº 900,000 - gº tº * * Wisconsin __803,000 - – | -- Total Avail/Est. $9,914,156 $10,000,000 1/ $10,000,000 / Cannot be distributed by geographic area in advance. 495 28-36 RURAL BUSINESS-COOPERATIVE SERVICE RURAL.ECONOMIC DEVELOPMENT GRANTS Classification by Objects 2009 Actual and Estimated 2010 and 2011 FY 2009 FY 2010 FY 2011 * Other Objects: 41 Grants, subsidies, and contributions.......... $9,914,156 $10,000,000 $10,000,000 Total direct obligations : ; 9,914,156 10,000,000 10,000,000 RURAL BUSINESS-COOPERATIVE SERVICE The estimates include appropriation language for this item as follows (new language underscored; deleted matter enclosed in brackets): Rural Microenterprise Investment Program. Account For the cost of loans and grants, [$5,000,000]$7,700,000 as authorized by Section 379E of the Consolidated Farm and Rural Development Act (7 U.S.C. 1981 et esq.): Provided, That such costs of loans, including the cost of modifying such loans, shall be as defined in section 502 of the Congressional Budget Act of 1974. 497 28–38 RURAL BUSINESS-COOPERATIVE SERVICE Analysis of Change in Appropriation RURAL MICROENTERPRISE INVESTMENT PROGRAMACCOUNT (On basis of loan level, subsidy and grants) - Loan Level Subsidy Grants Appropriations Act, 2010 $11,831,519 $2,500,000 $2,500,000 Budget Estimate, 2011 _23,523,352 6,850,000 850,000 Increase or decrease in Appropriations.......... 11,691,833 4,350,000 -1,650,000 ; PROJECT STATEMENT (On basis of supportable loan levels and appropriated subsidies and grants) - (In thousands of dollars). 2009 Actual 2010 Estimated Increase or Decrease 2011 Estimated Program Subsidy/ | Program Subsidy/ Program Subsidy/ Program Subsidy/ Item of Change Level || BA Level BA Level BA Level BA Discretionary: - º - - Microenterprise loans.................... $0 $0 11,831 $2,500 $11,692 (1) . . $4,350 (2) $23,523 $6,850 Microenterprise grants................... 0| 0. 2,500 2,500 -1,650 -1,650 (3) 850 850 Total Available or Estimate............. 0 O 14,331 5,000! 10,042 2,700 24,373 7,700 Total Appropriation, Discretionary....} 0 0 14,331 5,000 10,042 2,700 24,373} 7,700 Mandatory: aſ - - - - Microenterprise loans.................... () 0 3,242 685 3,087 1,158 6,329 1,843 Microenterprise grants................... 0 {} 3,315|| 3,315| -1,158 -1,158. 2,157. 2,157 Total Available or Estimate............. () O 6,557 4,000 1,929 () 8,486 || 4,000 Transfer from Commodity Credit - - - Corporation................. * > . . . . . . . . . . . –4,000 ... -4,000 -6,557 -4,000 -1,929 {} -8,486 -4,000 Unobligated balance available, SOY. 0| O 0| ` ol ' 0 0 0 0 Unobligated balance available. EOY. 4,000 4,000| 0 {} 0 0 ° () 0. Total Appropriation, Mandatory........ 0 0 () {} 0 O 0 0 Total Appropriation...................... 0 O 14,331 5,000 10,042 2,700 24,373 7,700 Staff years are reflected in the Salaries and Expenses Project Statement. aſ Mandatory funding provided by section 6022 of the Food, Conservation, and Energy Act of 2008, Public Law 110-246, dated June 18, 2008. The Act provides funds from the Commodity Credit Corporation of $4,000,000 each year for FY 2009 through FY 2011, to remain available until expended. : É PROJECT STATEMENT. (On basis of obligations under available funds) (In thousands of dollars) 1 Program Level Subsidy/ Program 10 Program Level Subsidy/ BA Discretionary: * Microenterprise loans.................... 11,831} . $11,692 & 4 e º e º e s m ºr e º sº a ſº e e < * - -1 $23,523 $6,850 850 Total Total Mandatory: aſ - Microenterprise loans.................... 1,843 * R & e $ tº tº ſº * * * * * * * * * * 157 7 7,700 1 Total A tº ºn tº e º ſº ſº ſº tº 9 g wº Commodity Credit Corporation.............................. () 4,000 Unobligated balance available, SOY. 4,000 0 - * * †. * * {} 0 Total Appropriation, Mandatory....... 0 () Total Appropriation...................... 700 73 Staff years are reflected in the Salaries and Expenses Project Statement. aſ Mandatory funding provided by section 6022 of the Food, Conservation, and Energy Act of 2008, Public Law 110-246, dated June 18, 2008. The Act provides funds from the Commodity Credit Corporation of $4,000,000 each year for FY 2009 through FY 2011, to remain available until expended. ; 500 28–41 JUSTIFICATION OF INCREASE AND DECREASES (1) An increase of $11,691,833 for direct microenterprise assistance loans ($11,831,519 available in (2) (3) 2010). In addition to mandatory funding provided in the 2008 Farm Bill, the budget requests discretionary funding for the programs which includes both loan and grant components. The agency expects to publish a Final Rule and begin funding loans and grants during the second and third quarters of FY 2010. - - - The loan component of the program will provide direct loans to microlenders which will, in turn make loans of $50,000 or less to rural microenterprises, generally businesses that employ 10 or fewer people. This program is significantly different than other lending programs because it integrates a technical assistance component to provide training and technical support to help ensure the success of the microbusiness borrowers (microborrowers). The training and technical assistance (TA) will be funded by grant dollars. In addition, enhancement grants may be awarded to existing and prospective microlenders to assist them in enhancing and strengthening their capability to provide microenterprise development services to their clients and create a solid network of rural microenterprise development organizations (MDOs). It is anticipated that the intermediary will revolve the RMAP loan funds twice in the 20-year term; and each ultimate recipient loan will assist one business and save a minimum of one job. Each loan to an ultimate recipient is expected to average $15,000 to $20,000. This equates to a minimum estimate of 40 business assisted and 40 jobs created/saved per $100,000 of loan budget authority. in 2010). The requested increase in loan subsidy it to support a growing program for direct microenterprise loans and to put a heavier emphasis on the loan making of this program instead of the grants portion. In addition, the change in the subsidy rate is due to the increase in the estimated Tréâsıry discount rate for these programs. - . . . *- A decrease of $1,650,000 for microenterprise assistance grants ($2,500,000 available in 2010). The requested decrease reflects a shift of funding to loans in order to provide assistance to more rural businesses. , º f * * . An increase of $4,350,000 for subsidy for direct microenterprise assistance loans ſ $2,500,000 available * * * 501 Total Avail./Est. Total Avail./Est. Total Avail./Est. Total Avail.jFst. RURAL BUSINESS-COOPERATIVE SERVICE GEOGRAPHC BREAKDOWN OF OBLIGATIONS 28-42 2009 Actual and Estimated 2010 and 2011 Microenterprise Loans 2009 * 2010 $11,831,519 1/ Microenterprise Grants 2009 sº ºne 2010 $2,500,000 ſ/ Microenterprise Loans - Mandatory 2009 2010 $17,439,659 1/ Microenterprise Grants - Mandatory 2009 2010 $4,315,000 1/ Cannot be distributed by geographic area in advance. 201 i $23,523,000 l/ 2011 $850,000 1/ 2011 $6,329,000 1/ 2011 $2,157,000 1/ 502 28-43 RURAL BUSINESS-COOPERATIVE SERVICE RURAL MICROENTREPRENEUR INVESTMENT ASSISTANCE ACCOUNT Classification by Objects 2009 Actual and Estimated 2010 and 2011 FY 2009 FY 2010 FY 2011 Other Objects: 41 Grants, subsidies, and contributions............ $0 $5,000,000 $7,700,000 Total direct obligations................................. 0 5,000,000 7,700,000 503 28-44 RURAL BUSINESS-COOPERATIVE SERVICE The estimates include appropriation language for this item as follows (new language underscored): Biorefinery Assistance Program Account For the cost of guaranteed loans, $17,300,000 as authorized by Section 9003 of the Food, Conservation and Energy Act of 2008, P.L. 110-246: Provided, That such costs, including the cost of modifying such loans, shall be defined in section 502 of the Congressional Budget Act of 1974: Provided further, That these funds are available to subsidize total loan principle, any part of which is guaranteed, not to exceed $51,000,000. This change provides language for a newly funded discretionary biorefinery assistance guaranteed loan program to compliment mandatory funding provided by the 2008 Farm Bill. 504 28–45 RURAL BUSINESS-COOPERATIVE SERVICE Analysis of Change in Appropriation BIOREFINERY ASSISTANCE PROGRAMACCOUNT (On basis of loan level and subsidy) Loan Level Subsidy Appropriations Act, 2010....................... - $0 - $0 Budget Estimate, 2011........... * a tº dº * * 49,855,908. 17,300,000 Increase in Appropriations................................... . . . . . . . . . . 49,855,908 17,300,000 § PROJECTSTATEMENT - (On basis of supportable loan levels and appropriated subsidies and grants) - (In thousands of dollars) - - - Unobligated balance available, start of year. PROJECT STATEMENT (On basis of obligations under available funds) (In thousands of dollars) Program Mandatory: Unobligated balance available, start of year... 112,752 39,993 end - I years are in a/ Mandatory funding provided by section 9003 of the Food, Conservation, and Energy Act of 2008, Public Law 1 10-246, dated June 18, 2008. The Act provides funds from the Commodity Credit Corporation of $75,000,000 for FY 2009 and $245,000,000 for FY 2010, to remain available until expended. ; 506 (1) (2) 28–47 JUSTIFICATION OF INCREASES An increase of $49,856,000 for biorefinery assistance guaranteed loans ($0 available in 2010). The Biorefinery Assistance Program (BAP) assists in the development of new and emerging technologies for the development of advanced biofuels. An increase in loan level in the amount of $49,856,000 is requested for this program for FY 2011. USDA expects to publish a proposed rule in February 2010; a finalized subsidy rate will follow once the final rule is published. Rural Development has been working closely with the advanced biofuels industry and anticipates that several projects will be funded in FY 2011 and that the demand for BAP loan funds will continue to rise as the industry becomes more familiar with the program and the state of technology for cellulosic production of advanced biofuels continues to improve. In addition to discretionary funding, the 2008 Farm Bill provided funding in FY 2008 and FY 2009 to support over $900 million in loan guarantees. An increase of $17,300,000 for subsidy for biorefinery assistance guaranteed loans ($0 available in 2010). - The increase in BA is requested to support almost $50 million in loan level. 507 28–48 |RURAL BUSINESS-COOPERATIVE SERVICE GEOGRAPHIC BREAKDOWN OF OBLIGATIONS 2009 Actual and Estimated 2010 and 2011 Biorefinery Loans - Guaranteed 2009 2010 2011 Georgia $80,000,000 tº tº * * ºt Minnesota 25,000,000 * * *** Total Avail./Est. $105,000,000 $803,476,177 1/ $49,856,000 1/ 1/ Cannot be distributed by geographic area in advance. 508 28-49 RURAL BUSINESS-COOPERATIVE SERVICE BIOREFINERY ASSISTANCE PROGRAMACCOUNT Classification by Objects 2009 Actual and Estimated 2010 and 2011 FY 2009 FY 2010 FY 2011 Other Objects: 41 Grants, subsidies, and contributions............ $0 $0 $17,300,000 Total direct obligations................................. - 0 Ö 17,300,000 509 28–50 RURAL BUSINESS-COOPERATIVE-SERVICE ENERGYASSISTANCE PAYMENTS PROJECT STATEMENT (On basis of appropriated grants) (In thousands of dollars) 2009 2010 Increase or 2011. Item of Change Actual Estimated Decrease Estimated Mandatory: - - Repowering assistance payments a...... $0 $0 $0 $0 Bioenergy program for advanced biofuels paymentsb..................... - O 55,000 30,000 85,000 Totai Available or Estimate............... 0 55,000 30,000 85,000 Transfer from Commodity Credit - Corporation............... * * * * * * * * * * * * * * * * * -90,000 -55,000 –30,000 -85,000 Unobligated balance available, SOY....], 0 {) () 0 Unobligated balance available, EOY.... 90,000 O 0. 0. Total Appropriation, Mandatory......... () 0 0. 0 Staff years are reflected in the Salaries and Expenses Project Statement. PROJECT STATEMENT (On basis of obligations under available funds) (In thousands of dollars) - 2009 2010 Increase or 2011 Item of Change Actual Estimated Decrease Estimated Mandatory: - • , Repowering assistance payments al...... $0 $35,000 –$35,000 $0 Bioenergy program for advanced - biofuels payments by..................... 0 110,000 –25,000 85,000 Total Available or Estimate............... 0 145,000 -60,000 85,000 Transfer from Commodity Credit - - Corporation................................ –90,000 –55,000 –30,000 –85,000 Unobligated balance available, SOY.... 0 -90,000 90,000 0. Unobligated balance available, EOY. 90,000 0 0 {} Total Appropriation, Mandatory...... ... 0 0 {) () Staff years are reflected in the Salaries and Expenses Project Statement. aſ Mandatory funding provided by section 9004 of the Food, Conservation, and Energy Act of 2008, Public Law 110-246, dated June 18, 2008. The Act provides funds from the Commodity Credit Corporation of $35,000,000 for FY 2009, to remain available until expended. b/Mandatory funding provided by section 9005 of the Food, Conservation, and Energy Act of 2008, Public Law 110-246, dated June 18, 2008. The Act provides funds from the Commodity Credit Corporation of $55,000,000 for FY 2009, $55,000,000 for FY 2010 and $85,000,000 for FY 2011, to remain available until expended. 510 2:8-51 RURAL BUSINESS-COOPERATIVE SERVICE GEOGRAPHIC BREAKDOWN OF OBLIGATIONS 2009 Actual and Estimated 2010 and 2011 Repowering Assistance Payments 2009 01 Totai Avail./Est. ** $35,000,000 2 {} 2 1 l dºesºpºwº- 1/ tº ºn * Bioenergy Program for Advanced Biofuels Payments 2 0. 2009 0.1 2011 Total Avail./Est. . ** $110,000,000 l/ $85,000,000 1/ **º- 1/ Cannot be distributed by geographic area in advance. 511 28-52 RURAL BUSINESS-COOPERATIVE SERVICE ENERGY ASSISTANCE PAYMENTS Classification by Objects 2009 Actual and Estimated 2010 and 2011 FY 2009 FY 2010 FY 2011 Jther Objects: 1 Grants, subsidies, and contributions......... $0 $0 $0 otal direct obligations.............................. {} {) 0 512 28–53 RURAL BUSINESS-COOPERATIVE SERVICE The estimates include appropriation language for this item as follows: Rural Energy for America Program For the cost of a program of loan guarantees and grants, under the same terms and conditions as authorized by section 9007 of the Farm Security and Rural Investment Act of 2002 (7 U.S.C. 8107), $39,340,000; Provided, That the cost of loan guarantees, including the cost of modifying such loans shall be as defined in section 502 of the Congressional Budget Act of 1974. 513 28-54 RURAL BUSINESS-COOPERATIVE SERVICE Analysis of Change in Appropriation RURAL ENERGY FOR AMERICA PROGRAM (On basis of loan level, subsidy, and grants) Loan Level Subsidy Grants ppropriations Act, 2010................................ $144,208,211 $19,670,000 $19,670,000 udget Estimate, 2011..................................... 11,518,550 5,340,000 34,000,000 crease or decrease in Appropriations......... -132,689,661 - 14,330,000 14,330,000 #. (On basis of obligations under available funds) PROJECT STATEMENT (In thousands of dollars) 2009 Actuals 2010 Estimated Increase or Decrease 2011 Estimated Program Subsidy/ Program Subsidy/ Program Subsidy/ Program Subsidy/ Item of Change Level BA Level BA Level BA Level BA Discretionary: r Guaranteed renewable energy loans aſ.......... $3,656 $354 $144,208) $19,670} -$132,689 (1) -$14,330 (2) $11,519 $5,340 Renewable energy grants............................ 4,646 4,646 19,670 19,670 14,330 14,330 (3) 34,000 34,000 Total Available or Estimate....................... 8,302 5,000 163,878 39,340 -118,359 0 45,519 39,340 Total Appropriated, Discretionary............... º 8,302 5,000 163,878 39,340 -118,359 0 45,519 39,340 Mandatory: - Guaranteed renewable energy loans aſbſ........ 53,802 5,213 212,830 29,030 -139,750 4,850 73,080 33,880 Renewable energy grants b/........................ 46,336 46,336 22,816 22,816 3,784 3,784 26,600 26,600 Renewable energy feasibility studies b/....... 1,245 1,245 5,760 5,760 960 960 6,720 6,720 Renewable energy audits and technical - assistance by...................................... 2,174 2,174 2,426 2,426 374 374 2,800 2,800 Transfer from Commodity Credit * Corporation bl................................... -103,588 -55,000 -243,800 -60,000. 134,600 -10,000 -109,200 -70,000 Unobligated balance available, start of year.... 0 0 -32]. –32 32 32 0 O Unobligated balance available, end of year..... 32 32 0 () 0 0 0 0 Total Appropriated, Mandatory................... () O 0. 0 () Ö {} () Total Appropriation................................. 8,302 5,000 163,878 39,340 -118,359 0 45,519 39,340 Staff-years are reflected in the Salaries and Expenses Project Statement. aſ The subsidy rate is based on a 0.25 percent annual fee. by Includes mandatory funding provided by section 9007 of the Food, Conservation, and Energy Act of 2008, Public Law 110-246, dated June 18, 2008. The Act provides $55 million in FY 2009, $60 million in FY 2010 and $70 million in FY 2011 from the funds of the Commodity Credit Corporation. The funds are available until expended. § * /t #. (On basis of supportabl PROJECTSTATEMENT e loan levels and appropriated subsidy and grants) (In thousands of dollars) 2009 Actuals 2010 Estimated Increase or Decrease 2011 Estimated - Program Subsidyl Program Subsidy/ Program Subsidy/ Program Subsidy! Item of Change Level BA Level BA Level BA Level BA Discretionary: - - Guaranteed renewable energy loans aſ........... $3,656 $354 $144,208 $19,670 -$132,689 -$14,330 $11,519 $5,340 Renewable energy grants..........................: 4,646 4,646 19,670 19,670 14,330 14,330 34,000 34,000 Total Available or Estimate....................... .* 8,302 5,000 163,878 39,340] -118,359 () 45,519 39,340 Total Appropriated, Discretionary................ 8,302 5,000 163,878 39,340 -118,359 {} 45,519 39,340 Mandatory: - - Guaranteed renewable energy loans abſ........ 53,802 5,214 212,830 29,030 -139,750 4,850 73,080 33,880 Renewable energy grants b/......................... 46,336 46,336 22,810 22,810 3,790 3,790 26,600 26,600 Renewable energy feasibility studies b/....... 1,245 1,245 5,760 5,760 960 960 6,720 6,720 Renewable energy audits and technical - assistance b/................................ ... ... 2,174 2,174 2,400 2,400 400 400 2,800 2,800 Transfer from Commodity Credit - - Corporation b/................................... -103,588 -55,000 –243,800 -60,000. 134,600 -10,000 -109,200 -70,000 Unobligated balance available, start of year..... 0. 0 {) {} 0 Ö ()| () Unobligated balance available, end of year..... 32 32 {} 0 () {} () 0. Total Appropriated, Mandatory................... {} () () {} 0 {} 0. {} Total Appropriation.................................. 8,302 5,000. 163,878 39,340; -118,359 {} 45,519 39,340 Staff-years are reflected in the Salaries and Expenses Project Statement. aſ The subsidy rate is based on a 0.25 percent annual fee. b/ Includes mandatory funding provided by section 9007 of the Food, Conservation, and Energy Act of 2008, Public Law 110-246, dated June 18, 2008. The Act provides $55 million in FY 2009, $60 million in FY 2010 and $70 available until expended. million in FY 2011 from the funds of the Commodity Credit Corporation. The funds are . 516 (1) (2) (3) 28-57 JUSTIFICATION OF INCREASE AND DECREASES A decrease of $132,689,000 for renewable energy guaranteed loans ($144,208,000 available in 2010). The requested decrease for this program is due to the fact that this program subsidy costs have increased significantly from 13.64% to 46.36% as a result of defaults. The administration is proposin, funding more grants than loans. A decrease of $14,330,000 for subsidy for renewable energy guaranteed loans ($19,670,000 available in 2010). The requested decrease for this program is due to the fact that the program level is reduced significantly. An increase of $14,330,000 for renewable energy grants ($19,670,000 available in 2010). The requested increase for this program is to meet the higher demand for grants and to support the President's commitment to climate change activities and renewable energy activities. 517 Guaranteed Renewable Energy Loans-Discretionary 2009 2010 Illinois $49,855 ** Iowa 2,305,234 sº Minnesota 339,187 tº ºr Nebraska 495,291. º Ohio 466,560 *** Total Avail./Est. $3,656,127 $105,749,032 1/ Guaranteed Renewable Energy Loans - Mandatory 2009 2010 California $70,000 *gº Colorado 600,000 **** Connecticut 391,310 rºº Georgia 1,334,894 “ºvº Illinois 2,903,459 -- Indiana 470,588 tºº Howa 18,704,344 tººt Kansas 882,853 ** Kentucky 333,298 *** Massachusetts 2,520,638 ** Michigan 502,465 *s Minnesota 2,422,640 &º Nebraska 2,209,128 º New Jersey 1,100,050 **** New York 475,599 * North Carolina 416,500 ** North Dakota 199,839 nº Ohio 9,511,511 *** Oregon 2,227,140 3-º-º: South Carolina 40,000 *º tº South Dakota 860,350 sº Tennessee 841,692 sº sº Vermont 1,184,794 ** Virginia 435,271 •ºº Washington 2,400,000 gºe West Virginia 319,408 Geº Wisconsin 445,131 useº Total Avail./Est. $53,802,902 $158,646,252 1/ RURAL BUSINESS-COOPERATIVE SERVICE * GEOGRAPHIC BREAKDOWN OF OBLIGATIONS 2009 Actual and Estimated 2010 and 2011 28-58 iſ Cannot be distributed by geographic area in advance. sºlº,099.4 $73,080,000 l/ 3-ºxº-. 518 28-59 RURAL BUSINESS-COOPERATIVE SERVICE §§OCRAPłłłC BREAKDOWN OF OBLIGATIONS 2009 Actual and Estimated 2010 and 204 f Renewable Energy Grants-Mandatory 2009 3040 2011 Alabama $37,490 --> Alaska 91,600 * *w- Arizona 135,444 bººs -- Arkansas 38,037 ** - California 570,607 -- - £olorado 563,802 *s -- Connecticut 195,650 ſº tº - Delaware 79,816 ---> - Florida. 415,470 * -- Georgia 1,469,866 * -- Hawaii I 12,305 * * * * Idaho 203,478 * - Illinois 2,992,325 * - Indiana 1,230,376 * * ** Iowa 11,464,535 - ** Kansas 1,025,734 ** -- Kentucky. $80,479 as as - Louisiana 304,523 - - NMaine 19t,534 . . * * * * Maryland 114,694 * - Massachusetts 1,446,491 ** - Nºichigan 1,522,047 *** -- Minnesota 3,756,069 * - Mississippi 477,315 * *w Missouri 487,334 * -ty Montana 75,202 **e *- Nebraska 2,163,830 ** - Nevada 119,906 *: *- New Hampshire 126,469 * wº New Jersey 654,740 tº ºr - New Mexico 109,483 sº gº -- New York 936,699 sº - North Carolina },485,954 * +- North £)akota 215,105 --> - ūhig 2,465,109 * -- {}klahoma 277,686 * ºw. Oregon 1,285,804 * - - Pennsylvania 503,837 hº was Rhode Island 31,995 *ex - South Carolina 548,046 ** “wº South Dakota 904,476 A- - Tennessec. 4,094,958 arº -- Texas 392,967 start - Utah 54,179. -- * Vermont 1,480,658 ºp -*. Virginia 388,626 -º-º: -- Washington 822,100 ** - West Virginia 231,492 *w - Wisconsin 944,405 ** -- Wyoming 57,083 * wº- Puerto Rico 100,737 es A- Virgin Islands - * -- W. Pacific Areas 20,000 * * {jndistributed wº tºy wº- Totai Awaiiſbst. $43,333,268 $33,332.3 # IL $26,600,000 # Il Cannot be distributed by geographic area in advance, 519 28.60 RURAL BUSINESS-COOPERATIVE SERVICE GEOGRAPHICBREAKDown of OBLIGATIONS 2009 Actual and Estimated 2010 and 2011 Renewable Energy Grants - Discretionary 2009 2010 2011 11 Cannot be distributed by geographic area in advance. Arizona - $113,504 -- Aº sº. Idaho - 15,560 wrº ** Illinois 144,834 - w sº tº ºt Iowa - 2,404,628 tºr ºt º Michigan 374,595 - -- *4%s Minnesota 411,132 * * * tº tº Nebraska 489,563 gº tº * * New York - 87,214 -- ** North Carolina 77,744 * * tºº Ohio 466,560 - ww.º. ** Oregon 11,748 ** ** Vermont 16,250 . sº tº wººs Wisconsin 32,380 **º ** Total Avail./Est. $4,645,712 $20,981,832 1/ $34,000,000 1/ 520 28-61 RURAL BUSINESS-COOPERATIVE SERVICE GEOGRAPHC BREAKDOWN OF OBLIGATIONS 2009 Actual and Estimated 2010 and 2011 Renewable Energy Feasibility Studies - Mandatory 1/ Cannot be distributed by geographic area in advance. º 2009 2010 2011 Arkansas $41,085 - -- -º Colorado 65,882 - ~~ - ºr Connecticut - 79,600 Fºr as ** Florida 38,800 - * - -- Idaho 75,000 -- - -*. Indiana 50,000 wº-1 - - ºr fowa - 78,000 ** * * Kentucky - 94.577 -- **. Louisiana - 3,750 tº wº - * Maryland 2,500 ** * º Massachusetts 20,000. * -ºº: Michigan 50,000 tºº - * vº Minnesota I 14,398 tº- ºf tº Missouri 12,500 wº **s Nebraska 20,462 -º ** New Hampshire . - 45,800 * * * * North Dakota 8,750 - ºr ºn - tº gº Oregon 173,000 - - ºf ºs South Carolina - 6,750 - - - U_ South Dakota 50,000 •- -- ºn wº Texas 10,276 -- tº tº Utah 52,500 - ... ** . . -s tº Washington 65,000 wºn tº - -º-º: Wisconsin 35,970 - -* ** Wyoming - 50,000 ** - - - Undistributed - - -- - tº wº Total Avail./Est. . $1,244,600 $6,000,000 l/ $6,720,000 1/ Renewable Energy Feasibility Studies-Discretionary 2009 2010 2011 Total Await./Est. *-ºp $3,934,000 l/ - ºl 521 28-62 RURAL BUSINESS-COOPERATIVE SERVICE GEOGRAPHIC BREAKDOWN OF OBLIGATIONS 2009 Actual and Estimated 2010 and 2011 Renewable Energy Audits and Technical Assistance Grants - Mandatory 2009 . 2010 2011 Arizona $99,750 ** * Wºr Colorado 73,890 | -- * * Georgia 100,000 **) tº tº Illinois 100,000 * Mº. *wº Indiana 100,000 ** wºº. Iowa 200,000 gº ºr *** Maine 100,000 *** -- Massachusetts 100,000 ---, - * * Michigan 100,000 . ºpt- ** Missouri 200,000 wº- tº - Nebraska 200,000 - *º- New Mexico 100,000 *-- ** Ghio 100,000 ** **** Oregon 199,991 Jºãº -- South Carolina 100,000 * *º- ** South Dakota 100,000 ** - ** West Virginia 100,000 ** ** Wisconsin 100,000 wº *wº Total Avail./Est. $2,173,631 $2,400,000 l/ $2,800,000 l/ l/ Cannot be distributed by geographic area in advance. 522 28-63 RURAL BUSINESS-COOPERATIVE SERVICE RURAL ENERGY FOR AMERICA PROGRAM Classification by Objects 2009 Actual and Estimated 2010 and 2011 FY 2009 FY 2010 FY 2011 Other Objects: 41 Grants, subsidies, and contributions.......... $5,000,000 $39,340,000 $39,340.00 Total direct obligations... - 5,000,000 39,340,000 39,340,00 523 28-64 RURAL BUSINESS-COOPERATIVE SERVICE The estimates include appropriation language for this item as follows (new language underscored; deleted matter enclosed in brackets): - Rural Cooperative Development Grants For rural cooperative development grants authorized under section 310B(e) of the Consolidated Farm and Rural Development Act (7 U.S.C. 1932), [$34,854,000, of which $300,000 shall be for a cooperative research agreement with a qualified academic institution to conduct research on the national economic impact of all types of cooperatives; andj$40,054,000, of which $2,800,000 shall be for cooperative agreements for the appropriate technology transfer for rural areas program: Provided, That not to exceed $3,463,000 shall be for cooperatives or associations of cooperatives whose primary focus is to provide assistance to small, socially disadvantaged producers and whose governing board and/or membership is comprised of at least 75 percent socially disadvantaged members; and of which $20,367,000, to remain available until expended, shall be for value-added agricultural product market development grants, as authorized by section 231 of the Agricultural Risk Protection Act of 2000 (7 U.S.C. 1621 note). - 524 28-65 RURAL BUSINESS-COOPERATIVE SERVICE Analysis of Change in Appropriation RURAL COOPERATIVE DEVELOPMENT GRANTS Appropriations Act, 2010 aſ......... • * * * * * se & tº * * ~ ~ • B e. e º 'º - © 16 g º e º is a e º e s - e. e. e. e. * * * o $34,854,000 Budget Estimate, 2011............................................................................... 40,054,000 Increase in Appropriations.................................................... - - - - - - - - - - - - - - -... . . . . 5,200,000 aſ Excludes $3,000,000 provided by General Provision 728(1) in P.L. 111-80. 525 28-66 PROJECT STATEMENT (On basis of appropriation) 2009 2010 Increase or 2011 Item of Change Actual Estimated Decrease Estimated Discretionary: - - Rural cooperative development gts.... $4,469,648 $7,924,000; $5,500,000 (1) $13,424,000 Appropriate technology transfer - for rural areas agreements....... • * * * * * 2,582,000 2,800,000 - 0 2,800,000 Cooperative research agreements....... 299,945 300,000 -300,000 (2) {} Grants to assist minority producers.... 1,414,306 3,463,000 - 0 3,463,000 Value-added agriculture product marketing development grants....... {} 19,348,650 () 19,348,650 Agricultural marketing resource - center grants..........................., 193,350| 1,018,350 0 1,018,350 Special Earmark, P.L. 111–8, GP 732. 1,877,000 0 0. 0 Special Earmark, P.L. 111-80, GP728 0. 3,000,000 -3,000,000 (3)}_ 0 Total Available or Estimate............. 10,836,249 37,854,000 2,200,000 40,054,000 º: of prior year obligations...... –2,581,181 0 0. {} nobligated balance available, SOY... –785,158] 0. 0 {} Unobligated balance available, EOY.: 7,043,090 0 {} {} Total Appropriation, Discretionary..... 14,513,000 37,854,000 2,200,000 40,054,000 andatory: aſ Value-added agriculture product marketing development grants....... {} 0 0 0 Agricultural marketing resource Center grants........................... 750,000 0 0 O Value-added agriculture product marketing development grants: Socially disadvantaged farmers - and ranchers........................ . . . 0 0 0 {) Mid-tier value chains.................. {} 0 0 - {} Value-added Innovation Center......... 0 0 {} 0 Total Available or Estimate............. 750,000 {} 0 0. ecovery of prior year obligations...... –341,914 {} 0 . 0. Unobligated balance available, SOY.. -1,005,249 0 0 0 Unobligated balance available, EOY.. 15,597,163 0 0 {} Transfer from CCC aſ............ ' ºr w w w w w w e -15,000,000 0 {} 0 Total Appropriation, Mandatory........ 0 01. {} {} Total Appropriation....................... 14,513,000 37,854,000 2,200,000 40,054,000 | years are reflected in the Salaries and Expenses Project Statement. a/ Mandatory funding provided by sections 6202 of the Food, Conservation, and Energy Act of 2008, Public Law 110-246, dated June 18, 2008. The Act provides $15,000,000 from the funds of the Commodity Credit Corporation (CCC) for fiscal year 2009, to remain available until expended. 526 28-67 PROJECT STATEMENT (On basis of obligations under available funds) 2009 2010 Increase or 2011 —r Item of Change Actual Estimated Decrease Estimated Discretionary: - Rural cooperative development gts....] $4,469,648 $7,924,000 $5,500,000 $13,424,000 Appropriate technology transfer for rural areas agreements........... 2,582,000 2,800,000; 0 2,800,000 Cooperative research agreements...... 299,945 300,000 –300,000 ( Grants to assist minority producers.... 1,414,306 3,463,000 0 3,463,000 Value-added agriculture product - - marketing development grants...... () 26,391,426 –7,042,776 19,348,65 Agricultural marketing resource - - Center grants......................... ... . 193,350 1,018,350 0 1,018,35( Special earmark, P.L. 111–8, GP 732. 1,877,000 0. 0 { Special earmark, P.L. 111–80, GP728 0 3,000,314 -3,000,314 { Total Available or Estimate............. 10,836,249 44,897,090 –4,843,090 40,054,000 Recovery of prior year obligations..... –2,581,181 {} 0 { Unobligated balance available, SOY.. –785,158 –7,043,090 7,043,090 ( Unobligated balance available, EOY.: 7,043,090 0 () . - { Total Appropriation, Discretionary.... 14,513,000 37,854,000 2,200,000 40,054,000 Mandatory: aſ Value-added agriculture product .- marketing development grants...... 0 12,580,710 -12,580,710 ( Agricultural marketing resource - Center grants........................... : 750,000 0 0. { Value-added agriculture product marketing development grants: Socially disadvantaged farmers and ranchers........................ ... 0 1,500,000 -1,500,000 ( Mid-tier value chains.................. 0 1,500,000 -1,500,000 ( Value-added Innovation Center......... 0 16,453 -16,453 { Total Available or Estimate............ . 750,000 15,597,163 -15,597,163 { Recovery of prior year obligations..... –341,914 0 0 { Unobligated balance available, SOY.. -1,005,249 - 15,597,163 15,597,163 { Unobligated balance available, EOY,. 15,597,163 0 0 { Transfer from CCC aſ................... -15,000,000 {} 0 { Total Appropriation, Mandatory....... - {} 0 O { Total Appropriation....................... 14,513,000 37,854,000 2,200,000 40,054,00ſ Staff years are reflected in the Salaries and Expenses Project Statement. a/ Mandatory funding provided by sections 6202 of the Food, Conservation, and Energy Act of 2008, Public Law 110-246, dated June 18, 2008. The Act provides $15,000,000 from the funds of the Commodity Credit Corporation (CCC) for fiscal year 2009, to remain available until expended. 527 (1) (2) (3) 28-68 JUSTIFICATION OF INCREASE AND DECREASES An increase of $5,500,000 for rural cooperative development grants ($7.924,000 available in 2010). To better address the key priorities of the Administration, including supporting thriving rural communities, the Rural Cooperative Development Grant program provides funding for technical assistance providers to assist in the development of cooperatives that increase the opportunities for economic development in rural communities. - The increase in funding for FY 2011 will allow Rural Development to expand the coverage, with more parts of the U.S. having the potential to access this program, as well as providing the ability to fund both multi-year and new entrants. The RCDG program has been severely oversubscribed in recent years and the requested increased funding level will reach a broader group of potential participants capable of providing enhanced support for cooperative development. This program provides funding for the Regional Innovation, healthy foods, healthy neighborhoods, and Know Your Farmer, Know Your Food Initiative. A decrease of $300,000 for cooperative research agreements grants ($300,000 available in 2010). The reduction reflects funding needs. The program will be funded from the regular rural cooperative development grants account. A decrease of $3,000,000 for special value-added earmark grants ($3,000,000 available in 2010). Earmarked value-added grants provide assistance to a limited area of eligibility. Other program funds under this account can be used on a competitive basis to provide the same benefits that the earmarked grant funds would provide to this area of country. The FY 2010 earmarked grant was provided in P.L. ! I 1-80, General Provisions 728, 528 28-69 RURAL BUSINESS-COOPERATIVE SERVICE GEOGRAPHICBREAKDOWN OF OBLIGATIONS 2009 Actual and Estimated 2010 and 2011 Rural Cooperative Development Grants Total Avail./Est. 1/ Cannot be distributed by geographic area in advance. $4,469,648 $7,924,000 1/ $13,424,000 ll 2009 2010 2011 Alabama $200,000 ºwº- --> Alaska 197,783 tº-º-º: wº wº California 200,000 ºws *- Colorado 200,000 tº wº ºr ºv Indiana 172,215 * * -º- Iowa 200,000 mºtºr - -º Kentucky 200,000 gº tº wwwºw Massachusetts 200,000 ºs & -A- Michigan 200,000 jº ºr * * Montana 299,696 ºčº * -º- Nebraska 199,954 ** * * North Carolina 200,000 ** tºº-º-º: North Dakota 400,000 ºf- -- Ohio 600,000 tººrºº *º º- Pennsylvania 200,000 dºº-ºº: - - South Dakota 200,000 vºt -- Virginia 200,000 wºº. 4--- Washington 200,000 tº ºn -- Wisconsin 200,000 tº-ºº: vºwſº 529 23–70 RURAL BUSINESS-COOPERATIVE SERVICE GEOGRAPHIC BREAKDown of OBLIGATIONS 2009 Actual and Estimated 2010 and 2011 Appropriate Technology Transfer 20t).9 2012 2011 Montana $2,582,000 * - sº- Total Avaii./Est. $2383,000 $2,800,000 l/ 2,800,000 iſ Cooperative Research Agreements 2009 2010 2011 Wisconsin $299,945 sºs *rº, Total Avail./Est, $399.24% $300,000 l/ º Grants to Assist Minority Producers 29ſº 2010 2011 Golorado $475,000 - wº- Hawaii i 12,855 4- ** Louisiati& 175,000 ºw - Mississippi 349,770 sº º- South Carolina 76,700 **t sº South Dakota 175,000 º- sºs Texas 174,981 º -º-º: Washington 175,000 tºº - •= . Total Avail./Est. $1,444,306 $3,463,000 l/ $3,463,060. H - E-º-º-º-Eº s-ºº-º-º-º-º-º-º-º: -º-º-º-º-E-- t Agriculture Innovation Demonstration Grants-Discretionary 2002 2010 2011. Vermont $469,000 º ** Wisconsin 1,408,000 * º Total Avail./Bst, $1,877,000 $3,000,314 ll sºrºr fººt Agriculture Innovation Demonstration Grants - Mandatory 2009 2010 2011 Total Avail./Est. •. $16,453.1/ ** tº Lº-º-º-º: Agriculture Marketing Resource Center Grants 2009 2010 2011 fowa $193,350 º - ** Total Avail./Est, $193,350 $1,018:30 lſ il,018,330 il Cannot be distributed by geographic area in advance. 530 28-71 RURAL BUSINESS-COOPERATIVE SERVICE GEOGRAPHIC BREAKDOWN OF OBLIGATIONS 2009 Actual and Estimated 2010 and 2011 Value-Added Agricultural Product Market Development Grants {}09 2010 Total Avail./Est. $26,391,426 1/ ** 2011 $20,367,000 1/ Value-Added Agricultural Product Market Development Grants - - Mandatory - 2009 2010 Iowa $750,000 750,000 2014 Total Avail./Est. $12,580,710-11 - Value-Added Agricultural Product Market Development Grants-Beginners and Socially Disadvantaged Farmers and Ranchers - Mandatory Total Avail./Est. * ºp $1,500,000 1/ sºº Value-Added Agricultural Product Market Development Grants Mid Tier Chains - Mandatory - - 2009 2010 2011 Total Avail./Est. *- $1,500,000 l/ ====-T 1/ Cannot be distributed by geographic area in advance. 531 28–72 RURAL BUSINESS-COOPERATIVE SERVICE RURAL COOPERATIVE DEVELOPMENT GRANTS Classification by Objects 2009 Actual and Estimated 2010 and 2011 - FY 2009 FY 2010 FY 2011 Other Objects: 44 Grants, subsidies, and contributions.......... $10,836,249 $60,494,253 $40,054,000 Total direct obligations.......... 10,836,249 60,494,253 40,054,000 532 28-73 RURAL BUSINESS-COOPERATIVE-SERVICE Analysis of Change in Appropriation RURAL, EMPOWERMENT ZONES AND ENTERPRISE COMMUNITIES GRANTS Appropriations Act, 2010 aſ........................................ • . . . . . . . . . . . . . . . . . . . . . . . . . . . . $0 Budget Estimate, 2011....................................................... . . . . . . . . . . . . . . . . . . . - () Decrease in Appropriations...................................................................... {} aſ Excludes $499,000 provided in General Provision 716 in P.L. 111-80. 533 28–74 PROJECT STATEMENT (On basis of appropriation) 2009 2010 Increase or 2011 Item of Change Actual Estimated Decrease Estimated Rural empowerment zones and enterprise communities grants $8,005,034 $0 $0. $0 General Provision 716.................. 0. 499,000 –499,000 0. Total Available or Estimate............ 8,005,034 499,000 -499,000 0. Unobligated balance available, start of year............................. -1,248,671 0 0. () Restoration of unobligated balance FY 2006............................... 1,248,671 0. 0 O Recovery of prior obligations........... -10,000 0. 0 0. Unobligated balance available, - - end of year............................. 12,957 O 0. () Total Appropriation..................... 8,007,991 499,000 -499,000 0 Staff years are reflected in the Salaries and Expenses Project Statement. PROJECT STATEMENT (On basis of obligations under available funds) - (In thousands of dollars) - 2009 2010 Increase or 2011 Item of Change Actual Estimated Decrease Estimated Rural empowerment zones and * - enterprise communities grants $8,005,034 $12,957 -$12,957 $0 General Provision 716............. … 0 499,000 -499,000 0 Total Available or Estimate.............. 8,005,034 511,957 -51 1,957 {} Unobligated balance available, start of year............................. -1,248,671 -12,957 12,957 {} Restoration of unobligated balance FY 2006.......................... - * * * * * 1,248,671 0. {} {} Recovery of prior obligations........... -10,000 0. 0 {} Unobligated balance available, end of year............................. 12,957 O 0. 0. Total Appropriation..................... 8,007,991 499,000 –499,000 0 Staff years are reflected in the Salaries and Expenses Project Statement. 534 28–75 JUSTIFICATION OF DECREASE (1) A decrease of $499,000 for special earmark grants ($499,000 available in 2010). The budget does not propose funding specifically earmarked projects. 535 28-73 RURAL BUSINESS-COOPERATIVE SERVICE GEOGRAPHIC BREAKDOWN OF OBLIGATIONS 2009 Actual and Estimated 2010 and 2011 Rural Empowerment Zone and Enterprise Community Grants Cannot be distributed by geographic area in advance. 2009 2010 Alaska $124,963 *ººl Arizona 124,963 ºwne California 1,076,103 tºrº Florida 124,963 tº tº Georgia 951,140 &sº Illinois 951,140 tºº. Kansas 124,963 tº º Kentucky 124,963 gº tº Maine 624,963 *** Michigan 124,963 gº wº Montana 124,963 sº dº New Mexico 124,963 sº ºn North Dakota 951,140 gººs Oklahoma 124,963 wººm Pennsylvania 124,963 sººms South Carolina 124,963 tº º South Dakota 951,140 tºº Tennessee 124,963 ** Texas 624,963 sº wº Washington 124,963 tº mº West Virginia 124,963 tº dº Wisconsin * 124,963 Tºº Total Avail./Est. $8,005,034 $511,957 1/ 536 28–77 RURAL BUSINESS-COOPERATIVE SERVICE RURAL EMPOWERMENT ZONES AND ENTERPRISE COMMUNITY GRANTS Classification by Objects 2009 Actual and Estimated 2010 and 2011 - FY 2009 FY 2010 FY 2011 Other Objects: - 41 Grants, subsidies, and contributions......... $8,005,034 $511,957 - $0 Total direct obligations... + 8,005,034 51 1,957 () 537 28-78 RURAL BUSINESS-COOPERATIVE SERVICE ALTERNATIVE AGRICULTURAL RESEARCH AND COMMERCIALIZATION CORPORATION REVOLVING FUND Project Statement by Program (On basis of obligations under available funds). 2009 2010 Increase or 2011 Estimate Estimated Decrease Estimated Alternative Agricultural Research - and Commercialization Revolving Fund.. 0. {} 0. 0 Total Available or Estimate................... () 0 0 {} Unobligated balance available, start of the year...................................... -$845,083 -$839,083 -$21,000 -$860,083 Royalties and fees............................. . 0 () 0 O Collection from Federal Sources............. 6,000 5,000 -1,000 4,000 Unobligated balance available, end of the year...................................... 839,083 834,083 22,000 856,083 Total Appropriation............................ 0. {} 0. 0. Section 6201 (a) of the Farm Security and Rural Investment Act of 2002, Public Law 107-71, dated May 13, 2002, repeals the AARCC authorization and section 6201(b) authorizes disposition of the aSSetS. 538 28–79 SUMMARY OF RECOVERY ACT FUNDING RURAL BUSINESS AND COOPERATIVE PROGRAMS SUMMARY OF RECOVERY ACT FUNDING (in thousands) Program/Project/Activity FY 2009 FY 2010 PL BA PL BA Actual Actual Available Available Rural Business & Industry Loans $49,412 $3,626 $1,523,298 $122,473 Rural Business Enterprise Grants $15,341 $15,341 $4,085 $4,085 Total Available for Program $64,753 $18,967 $1,527,383 $126,558 Salaries and Expenses $1,213 $1,213 $3,287 $3,287 Totai Available $65,966 $20,180 $1,530,670 $129,845 Project Statement- Recovery Act (On basis of available funds) (in thousands) 2009 2010 Actual Estimated PL * Staff PL wº. Staff Increase Of Actual Years Available Years Te2Sę Rural Business & Industry Loans $49,412 $3,626 $1,523,298 $122,473 -$1,523,298 Rural Business Enterprise - Grants $15,341 $15,341. $4,085 $4,085 -$4,085 Total Available for Program $64,753 $18,967 $1,527,383 $126,558 -$1,527,383 Salaries and Expenses $1,213 $1,213 -- $3,287 $3,287 - -$3,287 Total Available $65,966 $20,180 $1,530,670 $129,845 -$1,530,670 Program Implementation Activities: The Business and Industry Guaranteed Loan Program (B&I). The purpose of the B&I Guaranteed Loan Program is to improve, develop, or finance business, industry, and employment and improve the economic and environmental climate in rural communities. This purpose is achieved by bolstering the existing private credit structure through the guaranteed loans which will provide lasting community benefits. The program received a total of $1.7 billion in ARRA funds. In FY 2009 the program awarded a total of $49.4 million in ARRA loan guarantees for the program and created/saved 1,090 jobs. In FY 2010 there is $1.55 billion in carryover funds. In FY 2010 the program estimates it will award $1.5 billion in loan guarantees create/save over 36,000 Jobs. The Rural Business Enterprise Grant Program (RBEG) program provides grants that facilitate the development of small and emerging rural businesses, to help fund distance learning networks, and help fund employment-related training programs. The RBEG grants may be made to public bodies, private nonprofit corporations, and Indian Tribes on Federal and State reservations and other Federally-recognized Indian Tribal groups in rural areas. RBEG grants must finance or develop small and emerging private business enterprises. RBEG received $19.4 million dollars in ARRA Funding. In FY 2009, 145 ARRA 539 28-80 grants were awarded, totaling $15.3 million the remaining $4.1 million will be awarded in 2010 and will create or save and estimated 3,244 jobs. Goals and Coordination Efforts: Jobs Created or Saved: Businesses that provide high-quality employment opportunities will be good candidates for these B&I and RBEG ARRA funds. The Department of Labor defines high quality employment as jobs in long term, sustainable occupations that have career development ladders and will enable a worker to obtain livable wages. The sustainability of the employment opportunity is also an important factor. Applications submitted from the State offices will document why a project's jobs are considered high quality. - A borrower may be a cooperative organization, corporation, partnership, or other legal entity organized and operated on a profit or nonprofit basis; an Indian tribe on a Federal or State reservation or other Federally recognized tribal group; a public body; or an individual. Loan purposes must be consistent with the general purpose contained in the regulation. They include but are not limited to the following: --Business and industrial acquisitions when the loan will keep the business from closing, prevent the loss of employment opportunities, or provide expanded job opportunities. - --Business conversion, enlargement, repair, modernization, or development. --Purchase and development of land, easements, rights-of-way, buildings, or facilities. --Purchase of equipment, leasehold improvements, machinery, supplies, or inventory. Qbjectives: The overall intent of the B&I program and ARRA funding is to improve the quality of life by creating jobs. The public benefits by having a stronger local economy. As often happens in the downturn of the U.S. economy, small businesses particularly in rural communities may not have access to commercial credit at competitive rates and terms. Without access to capital, rural entrepreneurs may not be able to start new or expand existing businesses. As a result, rural communities will have limited goods and services available to them. The objective of the ARRA is to provide businesses with access to capital. Delivery Schedule: Funds were allocated to the State offices following development of an allocation plan based on Economic Research Service 2007/2008 data showing each State's percentage of: 1) the national rural population, 2) the national rural poverty, and 3) the national non-metro unemployment. Following allocation and application reviews, projects were funded when qualified. If States did not use all of their allocation, funds were returned to the National Office reserve for final redistribution based on State’s needs. However, there was no pooling of funds during fiscal year 2009, and funds will be pooled during fiscal year 2010. Outreach was conducted at the State and Local office level. National office assistance was provided as necessary. Outreach included meetings with rural lenders, attending and/or making presentations at conferences of National and State lending associations, etc. Some State offices conducted lender workshops. Performance Measures: FY 2009 FY 2010 FY 2011 Performance Measure Actual Target Target 1. Jobs saved/created: Rural Business and Industry 1,090 36,000 N/A Guaranteed Loans Program Rural Business Enterprise Grants * 12,015 3,244 TN/A 540 - - 28-81 FY 2009 Accomplishments: * Rural Business Enterprise Grant job targets are estimated by program staff based on historical information. Actual job numbers are verified by State staff working grant recipients. In FY 2009, the B&I program awarded a total of $49.4 million in ARRA loan guarantees and created/saved 1,090 jobs. For instance, Rural Development provided a $5 million loan guarantee to Citizens Commerce National Bank which will enable the lender to provide financing to their borrower, McKechnie Vehicle Components, USA and MVC Holdings, LLC. The proposed guarantee will allow stability by providing a permanent loan for the restructured automotive parts manufacturer, keep the business from closing, prevent the loss of employment opportunities and provide expanded job opportunities. The loan saved 275 jobs. In FY 2009, the RBEG program awarded 145 ARRA grants totaling $15.3 million. These grants created and or saved over 12,015 jobs. For instance, a grant for $83,149 was awarded to The Minnesota Chippewa. Tribe's Business Development Center to provide training for area businesses to expand, thereby creating new jobs and spurring economic growth. This stimulus project assisted four businesses. FY 2010 and FY 2011 Planned Activities: In FY 2010, the B&I program will have over $1.5 billion in carryover ARRA loan guarantees and create/save over 36,000 jobs in rural communities across the country. Approximately $4.1 million in carry over ARRA funds for the RBEG program will create or save an estimated 3,244 jobs. - 541 28g-1 RURAL DEVELOPMENT BUSINESS AND COOPERATIVE PROGRAMS STATUS OF PROGRAMS Current Activities: The Rural Development Business and Cooperative Programs provide, direct loans, loan guarantees, grants, technical assistance and payments designed to increase economic opportunity in rural America. Every rural community has unique challenges and natural resources. Rural Development (RD) State and field office staffs work collaboratively with political and business leaders to leverage RD resources. The Business and Industry (B&I) guaranteed loan program is one of the major tools that RD employs to facilitate business growth in rural areas. With RD guaranteeing up to 80 percent of the principal, lenders can serve local business development while minimizing lender risk. An annual renewal fee enables the agency to guarantee more loans to businesses by reducing program costs. - Specific areas being addressed currently include: 1. Facilitating projects that proactively replace traditional energy imports with domestic production. 2. Increasing outreach and improving service to lenders and borrowers. - - 3. Program delivery is transitioning to a risk-based management system. Part of this transition includes giving increased approval authority to qualifying State Directors. - Selected Examples of Recent Progress: Recent accomplishments under this appropriation item are cited below by project: - - - - Business and Industry Guaranteed Loan Program: The B&I loan program is Rural Development’s flagship job creation and capital expansion business program. The $1.1 billion awarded in FY 2009 created/saved more than 17,000 jobs and impacted 467 rural businesses. - Morris Manufacturing and Sales Corporation is a third generation family business that manufactures auto parts used in transmissions and drive trains by the major auto manufacturers. The guaranteed loan was for the refinancing of debt and purchase of machinery and equipment in the amount of $6.7 million. The loan created 24 jobs and saved 116 jobs in a struggling rural community in Brazil, Indiana. Green Meadows Foods, LLC (GMF) located in Hull, Iowa, received a $21 million guaranteed loan to construct a 110,000 square-foot state-of-the-art cheese and whey facility, licensed by USDA, to manufacture cheese and byproducts for human consumption. GMF plans to capture opportunities in the growing cheese and whey markets and accommodate the demand for cheese to counter regional decreases in producer premiums. Recent expansion of milk production in northwest Iowa, in conjunction with a long- term marketing agreement for cheese produced, provides GMF with the strength to be competitive in the U.S. cheese market. To protect the viability of their cheese processing, GMF will implement processing for whey which will help recover the full value of the milk purchased. It will obtain most of its raw ingredients from dairy farmers in the immediate geographic area via the local milk co-operative, Land . O'Lakes. In November 2008, production began at Green Meadows' processing facility that employs approximately 80 people. - Rural Energy for America Program: In FY 2009, the Rural Energy for America Program (REAP) funded 1,557 projects. the REAP program awarded 1,103 grants totaling $23.2 million plus 380 combination loans and grants amounting to $76.7 million (mandatory and discretionsry funds) and 2 guaranteed loans for $8.4 million for renewable energy and energy efficiency projects. The energy audit and renewable energy development assistance program 542 - 28g-2 awarded 22 grants totaling $2.17 million. $1.2 million was used to fund the renewable energy feasibility study program; which resulted in 50 feasibility study grants. In all, REAP provided $111.8 million in loa and grants to worthy projects that produced/saved an estimated 1.49 billion kWh. 1. For example, the Rural Electric Convenience Cooperative (RECC) in Illinois was looking for a way to add renewable energy to its portfolio. The cooperative decided its best option would be a utility scale wind turbine because of its environmental benefits and because it would reduce their wholesale power requirements and be a hedge against rising fuel costs. The co-op had access from Illinois’ Department of Natural Resources to a unique 60-foot reclaimed refuse mound at an abandoned coal mine in their service area near Farmersville, The height of the mound and the movement of the wind up the hill were just the factors needed to generate adequate winds to support a 220 foot, 900 kilowatt wind turbine. The challenge was how to make it affordable. RECC’s board voted to pursue the purchase of a wind turbine pending affordable financing. They applied for and received REAP grant for $375,000. Coupled with zero percent Clean Renewable Energy Bonds from CoRank backed by Rural Development, state grants and green tags purchased by the Illinois Clean Energy Community Foundation, RECC secured adequate financing for the project. The wind turbine was installed and is producing power. With the turbine generating electricity about 35 percent of the time, it can produce 5 million kilowatts a year and satisfy five percent of the co-op’s power needs. They serve 5,700 agricultural, commercial and residential customers in a five county area. The turbine will improve the cooperative's environmental footprint, replace some of the power they purchase and act as a hedge against unpredictable fuel costs. 2. Tyler Webb, of Stoney Pond Farm, Enosburg Falls, Vermont, installed a 10 kilowatt wind turbine in the fall of 2008 with the assistance of a grant from the Rural Energy for America Program of $15,000. The turbine has been operating well since start up and has generated 4,300 kWh for this family farm. Intermediary Relending Program: In FY 2009, 54 loans resulted in $33.536 million being made available to intermediaries who in turn funded 1,140 businesses to create or save an estimated 25,655 jobs. The following examples demonstrate the use of intermediary relending program (IRP) funds provided to intermediaries to fund projects in rural areas: 1. Alabama Department of Agriculture and Industries, Montgomery, AL, received $500,000 to relend to business throughout Alabama targeting applicants who propose investments in alternative fuel production and delivery, businesses in low income and high unemployment areas, and minority and women-owned businesses. Funding support will create and/or save at least 200 jobs. - - 2. Lake County Community Development Corporation, Ronan, MT, received $500,000 for small and emerging businesses in Lake, Mineral, and Sanders counties and to serve the Flathead Indian Reservation. The region has faced double-digit unemployment due to timber and technology sector layoffs and IRP funds will be used to support new employment opportunities in these areas. It is estimated IRP funds will create and or save more than 80 jobs in the local area. Rural Economic Development Loan Program: In FY 2009, a total of 57 loans with a combined value of more than $36 million were made to qualifying utilities creating or saving more than 4,370 jobs. For example, a $740,000 loan to Lane-Scott Electric Cooperative, Inc., Healy, Kansas, to finance the construction of a plant that uses local agricultural waste to produce fuel pellets for residential and commercial use. The project is expected to create 19 “green energy” jobs. - - 543 28g-3 &ural Economic Development Grant Program: n FY 2009, 34 grants were awarded with a combined value of $9.9 million. These grants contributed to a lumber of rural communities and were responsible for creating or saving more than 2,210 jobs. For xample, Rural Development made a $300,000 grant to the City of Pocahontas to make energy-efficiency mprovements to a school. tural Business Opportunity Grant Program: n FY 2009, the 35 grants awarded to residents and businesses in 20 states, Puerto Rico and the Western 'acific totaled $2.7 million and created or saved more than 990 jobs. One grant for $50,000 provided echnical expertise to promote and market locally grown crops and value added products in Sneedville, ennessee. The project is projected to create or save 59 jobs. - Rural Business Enterprise Grant Program: n FY 2009, 507 grants were awarded, totaling $40 million. These grants created and or saved over 14,938 obs. A grant for $75,000 was used to extend sewer lines to four small and emerging private businesses. e project assisted four businesses and created eleven new jobs. tural Business Enterprise Grant Program-Disaster: n FY 2009, 49 grants were awarded, totaling $4.8 million. These grants created and or saved more than ,400 jobs. A grant for $98,000 was awarded to the City of Lawrenceville in Illinois that was hit hard by |amaging storms and flooding to extend water and sewer services to an industrial park. The projec ssisted five businesses and created or saved forty-seven new jobs. - Rural Business Enterprise Grant Program-ARRA: n FY 2009, 145 grants were awarded, totaling $15.3 million. These grants created and or saved more than 2,000 jobs. A grant for $83,149 was awarded to The Minnesota Chippewa Tribe’s Business Development Center to provide training that promotes business expansion, thereby creating new jobs and spurring conomic growth. The project assisted four businesses. Value Added-Producer Grant Program: e maximum grant awards are $100,000 for planning grants and $300,000 for working capital grants. The rogram changes in the 2008 Farm Bill appear to have generated more interest in the program. In past ears, VAPG has averaged about 415 applications per year, with approximately 60 percent of those meeting eligibility requirements. An estimated 150 value added producers will benefit from the FY2009 rant funds. - - Agriculture Innovation Center Demonstration Program: n 2009, a special earmark of $1.877 million was appropriated under P.L. 111–8, “The FY 2009, Omnibus Appropriation,” Section 732 of Title VII, General Provisions, for a $1.408 million grant to the Wisconsin epartment of Agriculture, Trade and Consumer Protection; and a $469k grant to the Vermont Agency of Agriculture, Foods, and Markets to establish or expand an Agriculture Innovation Center (AIC) facility to rovide technical and business development assistance to agricultural producers seeking to engage in the arketing or production of value-added products. The Wisconsin Department of Agriculture, Trade and Consumer Protection will conduct a Dairy Business itiative that builds on a successful 5-year value adding strategy to support the aggressive repositioning of Wisconsin's most important industry. The initiative supports producers and processors through a set of 544 28g–4 strategies to add value through identification and development of increased markets for artisan and specialty cheese products, and other higher growth specialty dairy products. '.. - In its first year, the Vermont Agency of Agriculture, Foods, and Markets will dedicate resources to both establishing the center itself and supporting specific projects that can open markets with significant growth potential for Vermont producers who have a value added component to their businesses. Project areas will include coordination of agricultural and culinary tourism support, development of commercial opportunities for high quality specialty foods, and development of a framework for Place-Based marketing for Vermont foods to promote continued innovation in building new avenues for Vermont's farmers to connect with customers. Rural Cooperative Development Grants: In FY 2009, grants totaling approximately $4.4 million were made to 23 centers. Among the successful applicants was the Kentucky Center for Agriculture and Rural Development to provide technical assistance and education promoting new cooperatives while continuing to improve existing farmers' cooperatives. The Center estimates that it will assist at least 24 individuals, cooperatives or other organizations in business development efforts, creating 25 jobs and retaining more than 75 jobs for rural Kentucky. In addition, the Northwest Center for Cooperative Enterprise and Innovation of Olympia, WA was awarde funds to introduce cooperative approaches to distressed rural areas in Washington and in its newly expanded service areas in Oregon, Idaho, and Hawaii. The Center works to increase business diversification and economic sustainability and promotion of renewable resource cooperative businesses that encourage local jobs and ownership. Appropriate Technology Transfer to Rural America (ATTRA) ATTRA, also called the National Sustainable Agriculture Information Service, provides sustainable agriculture information to those engaged in or serving commercial agriculture, such as farmers, ranchers, extension agents, farm organizations, and farm-based businesses. In 2009, $2,582,000 was appropriated and obligated to fund the center. Work for the ATTRA project takes place in six locations through out the United States. The ATTRA project is staffed by more than 20 NCAT agricultural specialists with diverse backgrounds in livestock, horticulture, soils, organic farming, integrated pest management, farm energy, and other sustainable agriculture specialties. It provides information and other technical assistance to farmers, ranchers, Extension agents, educators, and others involved in sustainable agriculture in the United States. Cooperative Agreements for Research - A cooperative agreement in the amount of $299,944 was provided to the University of Wisconsin Center for Cooperatives (UWCC). The purpose of this funding was to measure the incidence and economic importance of cooperative activity across all sectors of the U.S. economy. The proposal builds on their existing strategy to initiate a longitudinal survey of cooperative business that will sustain research on cooperatives beyond the period of the grant. The research has three principal goals. First, the development of a comprehensive database on the full range of cooperatives in the United States to enable examination of cooperatives’ economic impacts, wealt creation, and return on investment. Second, provide broad-based access for research purposes to data collected within the boundaries of confidentiality required by the participating cooperative firms. And third, build collaborative relationships among academics, cooperatives, and government agencies in order to create an intellectual-policy hub in the United States for studying the organization and performance of cooperatives and their impacts on stakeholders and the overall economy. 545 28g-5 mall Socially-Disadvantaged Producer Grants: he Small Socially-Disadvantaged Producer Grants (SSDPG) program, formerly known as the Small [inority Producer Grant program, provides grants to fund technical assistance to small socially- sadvantaged producers from cooperatives and associations of cooperatives. In FY 2009, SSDPG program warded 10 grants amounting to $1.4 million. o programs were assessed in FY 2009. 546 28-82 RURAL DEVELOPMENT BUSINESS AND Cooperative PROGRAMs FY 2010 Summary of Budget and Performance Statement of Goals and Objectives Rural Development Business and Cooperative Programs have a strategic goal of increasing economic opportunity in rural America by enhancing capital formation and supporting the creation of divers, sustainable businesses. USDA Agency Strategic Strategic Agency . . Key Goal Goal Objectives Programs that Contribute Outcome USDA - Strategic Agency Objective; Intermediary Relending Program RD Key Goal: Goal 1: Objective 1.1: Rural Economic Development Loans Outcome 1: Increase Enhance Rural Economic Development Grants Enhanced economic capital Guaranteed Renewable Energy Loans capital opportunity formation and | Renewable Energy Grants formation an in Rural support the Guaranteed Business and Industry Loans opportunities America creation of Rural Business Enterprise Grant provided to diverse, agricultural sustainable Programs Authorized under 2008 Farm producers an businesses. Bill and Implemented in 2010: rural Assist rural businesses communities Biorefinery Assistance Program to create Bioenergy Program for Advanced Biofuels prosperity so Rural Microenterprise Assistance Program they are self- Sustaining, repopulating and economically thriving. Objective 1.2: Rural Cooperative Development Grants RD Key Provide new Cooperative Research Agreements Outcome i: opportunities Grants to Assist Minority Producers Enhanced for agricultural Value-Added Agricultural Product capital producers Market Development Grants (VAPG) formation and Agricultural Marketing Resource opportunities Center Grant provided to Rural Business Opportunity Grant agricultural producers and rural businesses. 547 28–83 Selected Accomplishments Expected at the FY 2011 Proposed Resource Level: With a $40 million budget authority in FY 2011, the Business & Industry program will support a program level of approximately $942 million. These loans will provide funding to businesses of all types which create jobs and promote economic growth. This level of funding will support creating and saving an estimated 16,650 jobs and assisting/creating and or saving approximately. - 350 businesses in FY 2011. The Rural Energy for America (REAP) guaranteed loan and grant program provides loan guarantees and grants to farmers, ranchers, and rural small businesses to assist with purchasing renewable energy systems and making energy efficiency improvements to their physical plants. Discretionary funding for 2011 is expected to be dispersed as $11.5 million in loans and $34.0 million in grants. The anticipated cumulative benefits for funded grant programs include –1,585 millions of kWh electricity generated with alternative energy sources, displacing 1,500 million metric tons of carbon emissions plus generate an estimated 9,500 jobs, The Value-added Agricultural Producers Grant Program enables independent agricultural commodity producers, agricultural producer groups, farmer and rancher cooperatives, and majority controlled producer-based business ventures to participate in the economic returns found in the value-added markets. Each year the number of recipients of value-added producer grants varies, but based on previous years, the $20 million program level, proposed in FY2011 will support over 130 value-added businesses. The Intermediary Relending Program (IRP) makes loans to intermediary borrowers (private nonprofit corporations, State or local government agencies, Indian tribes, and cooperatives) who, in turn, relend the funds to individuals, public or private organizations and other legal entities that meet the criteria for ultimate recipients. Financial assistance from the intermediary to the ultimate recipient supports economic and community development projects, new businesses and/or expansion of existing businesses. Based on an analysis of historical data on actual number of intermediaries assisted, number of businesses impacted and creation or saving of jobs, it is anticipated that the $36 million proposed budget authority in FY2011 will impact over 325 businesses and create/save an estimated 26,000 jobs. Rural Cooperative Development Grants help to improve the economic condition of rural areas by creating or retaining jobs through the development of new rural cooperatives, value-added processing, and other rural businesses. These grants are made to rural development centers— nonprofit corporations including institutions of higher education — that provide technical assistance to organizations exploring the cooperative form of business entity and to existing cooperatives interested in improving their operations or expanding into new market areas. Owners across the nation in establishing and marketing cooperatives. The funding provided in FY 2011 for this program will support approximately 25 grantees that will assist over 360 cooperatives and prospective cooperative groups. The assistance provided by the program will help strengthen the rural economy and assist farmers, ranchers, and rural businesses. Section 6022, Rural Microentrepreneur Assistance Program – (RMAP) This new program to be implemented in FY 2010 provides rural microentrepreneurs the opportunity to gain the skills necessary to establish new rural microenterprises, training, and to provide continuing technical and financial assistance related to the successful operation of rural microenterprises. Loans and grants will be made to eligible and qualified Microenterprise Development Organizations (MDO’s) for the purposes of 1) providing microloans to rural microentrepreneurs, and 2) providing training and technical assistance to current- and/or potential microentrepreneurs to establish new or sustain existing micro businesses in rural areas. When implemented in FY2010, the budget will support a program level of $14.3 million. Each loan to an ultimate recipient is 548 28–84 expected to average $15,000 to $20,000. This equates to a minimum estimate of 40 business. assisted and 40 jobs created/saved per $100,000 of Loan Budget Authority. In FY 2011, RMAP $24.3 million in program level is expected to create or save over 8,000 jobs and assist a similar number of rural microbusinesses as in FY 2010. The Biorefinery Assistance Program (BAP) or Section 9003 program assists in the development of new and emerging technologies for the development of advanced biofuels. The $17.3 million in FY 2011 budget authority will result in $49.9 million in program funds that is estimated to support about $49.9 million in loan guarantees. While the size of projects may vary, the first BAP project required an $80 million loan guarantee. Rural Development has been working closely with the advanced biofuels industry and anticipates that one or two projects will be funded in 2011 and that the demand for BAP loan funds will continue to rise. 549 28–85 RURAL DEVELOPMENT BUSINESS AND COOPERATIVE PROGRAMS Goal 1: Key Outcome: Enhanced capital formation and opportunities provided to agricultural producers and rural businesses Key Performance Measures: Measure #1; Measure #2; Measure #3: Measure #4: : Key Performance Targets: Summary of Budget and Performance Number of jobs created and saved Million of kWh generated Assist existing and prospective cooperative groups Value added businesses assisted Key Performance Outcomes and Measures 2006 2007 2008 2009 2010 2011 Performance Measure Actual Actual Actual Actual Target Target Performance Measure #1 a. Jobs created/saved” total 71,715 72,710 72,907 68,969 74,005 70,554 B&I 14,837 12,343 18,703 17,602 20,000 16,665 RBEG 19,707 21,346. 18,766 14,938 15,000 11,300 RBOG 5,110 8,191 2,802 3,400 3,400 2,000 IRP 25,910 25,911 25,655 26,449 25,655 26,000 REDL 4,636 3,273 4,891 4,370 4,500 2,254 REDG 1,515 1,646 2,090 2,210 1,650 1,650 RMAP -- ... -- -- * = 3,800 8,000 b. Program Dollars (000s)** $880,242 $937,407 || $1,588,925 $1,074,455 $1,137,096. $1,086,999 ARRA Funds' a. Jobs created/saved (B&I & RBEG) 13,105 39,244 b. Program (B&I & RBEG) Dollars (000s) 64,726 1,527,384' Performance Measure #2 a. Million of kWh. generated with alternative energy 1,575 2,924 1,584 2,304 2,120 1,585 SOURCES b. Program Dollars (000s) - Loans - - Grants $24,159 $57,098 15,566 25,780 105,749 11,519 (in thousands) $22,237 $19,102 $34.2 2,500 20,982 34,000 550 28-86 Performance Measure #3 a. Number of Cooperatives and prospective cooperative groups assisted 195 187 175 200 300 36( b. Program Dollars $4,357 $6,218 $4,547 $8,766 $14,487 $19,68. (in thousands) - - - Performance Measure #4 a. Proposed, new, or expanded Value-Added businesses assisted i85 151 142 0 286 || 13t b. Program Dollars - - (in thousands) 21,203 $23,801 $19,389 $943? 43,007 $20,36. * 2011 Program dollars consist of the following programs: intermediary relending program, rural economic development loan and grant; business and industry guarantee; rural business grants; and rural micro-enterprise assistance. 1- ARRA Funds consist of the following programs: Business and Industry Guarantee; and Rural Business Enterprise Grant, and assumes one third of funding spent in FY 2009 and remaining two- thirds of funding carried over and spent in FY 2010. - 2- FY 2009 VAPG finds were carried into FY 2010. 551 28–87 BUSINESS AND COOPERATIVE PROGRAMS Full Cost by Secretary's Strategic Priorities trategic Priority: Assist rural communities to create wealth so they are self sustaining, repopulating and thriving. - PROGRAM ITEMS 2009 AMOUNT 2010 AMOUNT | 2011 AMOUNT $31,431 7 f Measure (unit Measure (unit trants - level for America Performance measure: Cost per Measure 552 28–88 PROGRAM PROGRAM ITEMS 2009 AMOUNT | 2010 AMOUNT | 2011 AMOUNT Rural for America Loans and Grants - Level 103,558 197 $109 7() Costs - f 77 50 IIIC3Sülfè. T - I unit () Cooperative Development Grants, Appropriate Technology Transfer, Cooperative Research and Grants to Assist level 766 7 17,487 Costs - 178 38 Costs - 84 - i - 300 Measure (unit {} ałue Added Product Market Grants Res. Center Grants 4 | 410 137 535 15 T {} l Cost per Measure (unit {} () aiue Added Agricultural Product Market Development Grants & Agricultural Mtng. Res. Center Grants - Level $7 7 Costs - 690 Costs Performance measure: Round II Dollars T Measure (unit 553 28–89 PROGRAM ITEMS | 2009 AMOUNT | 2010 AMOUNT | 2011 AMOUNT Earmarks GPs 764 - 2006 and Farmarks $1 Measure (unit Guaranteed foans Costs T Guaranteed T {} unit {} Business Enterprise Grants, Business Fnterprise Grants Technical Assist. Transportation, Business Enterprise Grants Mississippi Delta, Rural Business Enterprise Grants Native American and American Tribes T. I } Measure (unit {} Business Opportunity Grants, Rural Opportunity Grants Native American Tribes, Business (*rants Delta and Grant to Delta A $5 HłędSLllº. Measure 554 28-90 PROGRAM PROGRAM ITEMS 2009 AMOUNT | 2010 AMOUNT | 2011 AMOUN' Rural ${} {} 139 4 unit Assistance - Mandators' Level H16.asRiſø. created/saved T Measure { unit Loans Costs Measure (unit Loans - Level Costs Costs Measure (unit & Level Measure 555 28-91 PROGRAM PROGRAM ITEMS 2009 AMOUNT | 2010 AMOUNT | 2011 AMOUNT Guaranteed Business I,oans 2008 Disasters $163 T Rural Business 2007 Disaster Measure (unit Rural Business rants 2008 Disasters F. T Iſléastiſe. Loans - unit Business - Stimulus Measure (unit 556 28-92 PROGRAM - PROGRAM ITEMS 2009 AMOUNT | 2010 AMOUNT 2011 AMOUNT Total for s Priurities Level 725 752 l - 44. 126 741 Costs Costs 629 Hića Słłſe: A N/ A. N/ Measure 1/ RED Grants funded through cushion of credit and fees from underwriter bonds and notes. 2/ Guaranteed Renewable Energy Loans and Grants funding contingent on Farm Bill for FY 2009. . 3/ Performance measure changed from coops assisted to groups assisted. 4) FY 2008 and 2009 Estimates and Performance Measures based on RCDG and GAMP programs only. 3/ Measure and target changed from recipient revenues to businesses assisted. S&E and FTE figures for each program are based on calculations and a best estimate of the personnel involved. Actual staff time by program is not available at this time. 557 2011 Explanatory Notes Rural Utilities Service Table of Contents Page urpose Statement................................. ......................................... * * * * * * * * tº t w & p * * * * * B = 2 29-1 ural Water and Waste Disposal Program Account: Appropriations Language................ • * * * * * > * > * * * * * * * * * * * * * * * * * * * * g º e º e º s = c e s tº a tº a s is a s w a g º ºr a s º º ....... 29-5 Project Statement............... * * * * * * * * 4 * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * a s p * * * * $ s 6 m w tº a s * * * * * * * * * * * * & tº e g º ºs • 29-8 Justifications tº e º º º * tº e a 4 ſº e < t > * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * g e * * * * * * * * 4 * * * * * 4 * * * * * * * * * * * * * * * * * * * * * * * * * * * * - 29- } 3 Geographic Breakdown of Obligations....................... * * * * * * * * * • . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. 29-14 Classification by Obj Čcts * * * * * * * * * * * * * * * * * * * * * * * to e º a p + 4 = * 4 tº 8 º' a y o e º 'º a u tº n w = w w w w is a p J tº 4 º f * * e º 'º e s s tº e g º 0. ; gº º 29-26 Mural Electrification and Telecommunications Program Account: Appropriations Language.......................................................... t e s & e s tº a s , s a 4 g º s w tº a s & a 29-27 Project Statement....................................................... 'e s a s m = • * * * * * * * * * * * * * * * * * * * * * * * * * * * * 29-29 Justifications................................... • * g e < * * * * r * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * 29–32 Geographic Breakdown of Obligations......................... * * * * * * * s 6 tº e º e º a s a a º M tº a tº a sº tº a t w 4 tº p * * * * * * * 29–33 Classification by Objects.............................................................. * - 4 & e º 'º 4 ſº º ºr 8 º' & © tº dº º º 29-36 )istance Learning, Telemedicine, and Broadband Program Account: - Appropriations Language.................................................................... & Wh 4 º' tº o º ſº a tº lº 29-37 Project Statement............................................................ r & © tº e * * * * * * * * * e º e º 'º ºf a * * * * * * * t 29-39 Justifications...... tº e º 'º w w w e º 'º e º ºr e º a º ºr e > a. s. v. º. º. º. º e º a wº e s e e > * * * * * * * * * * * * * * * * * * * * * * * * * * * * * . . . . . . . . . . . . . . . . . . . .--> 29-41 Geographic Breakdown of Obligations....................................... * * * * * * * s • * * * * * * g g º º v c e º º º 29-42 Classification by Objects................................................ 4 tº * * * * * * * * * * * * * * * * * * * * * * * * * * * tº ºr * , 29–45 ſigh Energy Cost Grants: - Project Statement....................... * † tº p ºr * * * * * * * * * * * * tº 4 & 2 º k is w t w w w 4 a b ºr e º a 4, a b > º, tº * * * * * * * * * * * * * * * * * * * * * * * * 29-46 Geographic Breakdown of Obligations................................................. to a tº e º e º t e º e º e º a m 29–47 Classification by Objects.......................................... tº e a # 2 s a 3 m e º A & a w s - e a w = 2 * * * * * * * * * * * * * * * * 29-48 ummary of Recovery Act Funding................... As º a re e º $ tº x s a tº a º º e º 'º a• . . . . . . * * > ºr c is tº a tº . . . . . . . . . . . . . . . . . . , 29–49 tatus of Program............ * * * * * * * * * * * * * * * * u & tº t t e º e s w = e > * * * * * * * * * * * * a tº A. e. p = < * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * 29g-l tatement of Agency Goals and Objectives................................................................... 29-53 ‘ey Performance Outcomes and Measures................................................................... 29–58 'ull Cost by Strategic Goal,................................ • * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * g º a tº e º 'º - e º 'º - 2 ºr 29-62 558 29-1 RURALUTILITIES SERVICE Purpose Statement Rural Utilities Service (RUS) programs enhance the quality of life and improve economic opportunity in rural communities by providing financing for the basic infrastructure of modern life. Electricity and telecommunications are essential services for milividuals and businesses alike. Adequate water and wastewater treatment capacity are significant quality of life, environmental and economic development issues. Tighter environmental standards and the importance of accommodating business growth m a rapidly diversifying rural economy add significantly to program demand. Authorization and Program Descriptions - The RUS delivers electric and telecommunications programs authorized by the Rural Electrification Act 1936, as amended, 7 U.S.C. 901 et seq., (RE Act). Electric Programs The Electric programs offers direct loans, guaranteed loans, and bond and note guarantees. The priſm differences among the various electric loan programs are the statutory authority, qualifying criteria and Interestrate. The program also administers the High Energy Cost Grant Program. Direct loans mclude hardship rate loans. Direct loans may be used to finance improvements to electric distribution, transmission, and generation systems, including demand side management, energy efficienc and conservation programs, and renewable energy systems to serve rural areas. Eligibility requirements under each type of direct loan vary. Program authorities under the RE Act were amended in the 2008 F Bill and regulations implementing the various changes are m process. Hardship rate direct loans are available to finance electric system improvements for qualified borrowers that meet thresholds for retail rate disparity and for customer per capita and household incomes, or that have suffered a severe, unavoidable hardship, such as a natural disaster. Supplemental financing is not required. Fixed rate 5 percent loans are available under 7 U.S.C. 935. Direct Hardship loans are authoriz by 2008 amendments to 7 U.S.C. 904, but have not yet been funded, Regulations are under development Guaranteed loans are provided under 7 U.S.C. 936 for financing of electric distribution, transmission, generation and headquarters facilities. The Treasury Department's Federal Financing Bank (FFB) has bº the primary source of these loans. FFB loan guarantees remain available to all electric borrowers under annual appropriations. FFB mterest rates are fixed to the prevailing cost of money to the Treasury, plus administrative fee of one-eighth of 1 percent. USDA guaranteed private loans issued through CFC, Co Bank or other lenders carry an interest rate negotiated between the lender and the borrower, Bond and note guarantees for cooperative lenders are authorized under section 313A of the RE Act. USDA may guarantee payments on certain bonds or notes issued by qualified cooperative or other non- profit lenders. The bond or note proceeds must be used for eligible rural electrification or telephone purposes (excluding electric generation), and must be of investment grade. The mterestrate is equal to t Treasury rate for notes of similar maturities plus an annual fee of 30 basis pomts on any unpaid principa balance. Regulations implementing 2008 amendments are under development. High Energy Cost Grants under section 19 of the RE Act are available for energy generation, transmission, and distribution facilities, mcluding energy efficiency and conservation programs and renewable energy Systems that serve rural communities with extremely high energy costs that exceed 27 percent of the national average. Grants are awarded directly from RUS. In addition, RUS may make grants to the Denali Commission to carry out eligible projects in small remote villages m Alaska. 559 29-2 Telecommunications Program Infrastructure loans are made to furnish and improve telecommunications services, including a wide array of telecommunication related services, in rural areas. Hardship (direct loans) loans bear interest at a fixed rate of 5 percent per year. These loans are intended only for borrowers with extremely high investment costs in terms of per subscriber service. These borrowers also have a very low number of subscribers for each mile of telecommunications line constructed. This low subscriber “density” inherently increases the cost to serve the most sparsely populated rural areas. Because of the high cost of the investment needed, these borrowers cannot typically afford higher interest rate loans. Direct loans (or Treasury rate loans) bear interest at the government’s cost of money (or the current Treasury rate). Thus, the interest charged varies with the Treasury rate. As Treasury rates increase, so does the cost to the borrower for these loans. - Guaranteed loans are provided to borrowers of a non-government lender or from the Federal Financing Bank (FFB). The interest rate charged on FFB loans is the Treasury rate plus an administrative fee of one- eighth of 1 percent. The terms of these loans may vary significantly and allow borrowers more flexibility in meeting their financing needs. In terms of risk, all loans are based on extensive feasibility studies that determine a borrower's ability to repay the loan and loans are monitored and secured through covenants in loan contracts and the borrower’s mortgage with Rural Development, which gives the government a first lien on all of the assets of the borrower. - Broadband loans were first authorized in the Farm Security and Rural Investment Act of 2002 (2002 Farm Bill) which established a new loan and loan guarantee program “Access to Broadband Telecommunications Services in Rural Areas.” This program is designed to provide funding for the cost of constructing, improving, and acquiring facilities and equipment for broadband service in rural communities of 20,000 inhabitants or less. Direct loans are made at the cost of money to the Treasury for the life of the facilities financed. Loans may be made at four percent to rural communities where broadband service does not currently exist. Loan guarantees bear an interestrate set by the private lender consistent with the current applicable market rate for a loan of comparable maturity and are guaranteed for no more than 80 percent of the principal amount. - American Recovery and Reinvestment Act of 2009 (ARRA) Broadband Initiatives Program provides $2.5 billion in budget authority for loan, grant and loan/grant combinations financing of broadband infrastructure in rural communities. This program was announced in a Notice of Funds Availability published on July 9, 2009. Distance learning and telemedicine (DLT) loans and grants are authorized by 7 U.S.C.950aaa. This program assists rural schools and learning centers gain access to improved educational resources, and assists rural hospitals and health care centers gain access to improved medical resources. Building on advanced telecommunications infrastructure, telemedicine projects are providing new and improved health care services and benefits to rural residents, many in medically underserved areas, by linking to urban medical centers for clinical interactive video consultation, distance training of rural health care providers, and access to medical expertise and library resources. Distance learning projects provide funding for Internet-based educational services in schools and libraries and promote confidence in, and understanding of, the world-wide-web and its benefits to students and young entrepreneurs. Loans, made at the Treasury rate of interest, and grants will encourage, improve, and make affordable the use of advanced telecommunications. This increased use will provide educational and health care benefits to people living in rural areas. Program results have demonstrated the dramatic benefits that can be achieved by investments made in educational interactive video, Internet, and other information networks. 560 29–3 investments made in educational interactive video, Internet, and other information networks. Water and Waste Disposal Loans and Grants Direct Water and Waste Disposal Loans - Section 306 CONACT & 7 U.S.C. 1926. Direct loans may be made to develop water and wastewater systems, including solid waste disposal and storm drainage, in rural areas and in cities and towns with a population of 10,000 or less, Guaranteed Water and Waste Disposal Loans - Section 306 CONACT & 7 U.S.C. 1926. Guaranteed loans may be made for the same purpose as direct loans. They are made and serviced by private lenders such as banks and savings and loan associations. The guarantee is 90 percent of the eligible loss incurred by the lender. Water and Waste Disposal Grants - Section 306 CONACT & 7 U.S.C. 1926. Grants are available to reduce water and waste disposal costs to a reasonable level for users of the system. Grants may be made, in some instances, up to 75 percent of eligible project costs. Water and Waste Facility Loans and Grants to alleviate health risks- Section 306(c) CONACT & 7 U.S.C. 1926. Section 306C loans and grants are available to low-income rural communities whose residents face significant health risks because they do not have access to water supply systems or waste disposal facilities. The grants are available to provide water or waste services to designated colonias in Arizona, California, New Mexico, and Texas. Grants may be made in conjunction with loans and up to 100 percent of the eligible project cost. Solid Waste Management Grants - Section 310 (b) CONACT & 7 U.S.C. 1932. Grants are made available to eligible organizations to address solid waste management issues and threats to water resources from solid waste in rural communities. Assistance may be provided to enhance operator skills in operations and maintenance, 1dentify threats to water resources, reduce or eliminate pollution of water resources, improve planning and management of solid waste disposal facilities in rural areas, and reduce the solid waste Stream. - Geographic dispersion of offices and employees Rural Development programs are administered by the three programs within Rural Development: Housing and Community Facilities, Business and Cooperative Development and Utilities Service. Rural Development headquarters is located in Washington, D.C. As of September 30, 2009, there were 5,873 total permanent full-time employees including 1,653 in the headquarters office and 4,220 in field offices. OIG Reports 09601-004-TE FINAL-Broadband Loan and Grant Programs. In an effort to address criticisms and challenges encountered (from industry, Congress, the IG, as well as desired internal changes), Rural Development issued a Proposed Rule, published in May 2007 seeking comments from interested parties, that: - (1) clearly defined served, underserved, and un-served markets based on service availability and the number of existing competitors and target un-served an underserved areas; (2) provided applicants with a clear definition of which communities are eligible for funding; (3) established equity requirements that provide incentives for serving the un-served; (4) reduced market survey requirements; (5) increased application transparency through web-based information dissemination; and (6) imposed new time limits for timely deployment of services to rural customers. 561 29-4 New Regulation Implementing 2008 Farm Bill: New regulations have been drafted; proceeding with publishing this regulation will address many of the open concerns reported in the last (and upcoming) OIG Audit. The new rules will: • Implement a new definition of “rural”—eliminating financing in the “urbanized areas” • Limit funding where there are already three or more service providers • Place an emphasis on serving the un-served and under-served • Streamline application procedures and increase the transparency of the application process Current Status: - All the agency’s resources have been dedicated to the full implementation of funding provided in the Recovery Act. The agency continues to develop an interim final rule to improve the ongoing broadband program. Current OIG Audit: Discussion draft issued January 6, 2009; exit conference was January 29, 2009. The audit was still critical of the program, noting that since the original audit, many recommendations had not been adopted; specifically, issues concerning the definition of rural, funding in competitive areas, funding in “suburban” areas. Despite publishing a proposed rule that addressed these concerns (in May 2007), the audit made no reference to that action. The proposed rule: • clearly defined served, underserved, and un-served markets based on service availability and the number of existing competitors and target un-served an underserved areas; provided applicants with a clear definition of which communities are eligible for funding; established minimum transmission rates that must be delivered to the consumer; . established equity requirements that provide incentives for serving the un-served; increased application transparency through web-based information dissemination; and imposed new time limits for timely deployment of services to rural customers. OIG revised the draft audit and provide some credit for issuing the proposed rule. Current Status: Official draft audit was issued 2/23/09. Rural Development has responded with comments on 3/25/09, noting discrepancies and inaccuracies. The final audit was dated 3/31/09. GAO Reports 320368–Reviewing the Use and Effectiveness of U.S. Financial, Program, and Technical Assistance Under the Amended Compact of Free Association (P.L. 108-188) and Related Agreements. 360666–Entrance: Impact of Coastal Barrier Resources Act (Departmental Audit – Rural Development has the lead). 360754–Entrance: Freshwater Programs (Departmental Audit—Utilities Programs has the lead). 543159–Exit: Funding of Public Broadcasting. Program staff had no issues with the comments in the report. 562 29-5 RURAL UTILITIES SERVICE The estimates include appropriation language for this item as follows (new language underscored; deleted matter enclosed in brackets): - Rural Water and Waste Disposal Program Account (including transfer of balances) 2, 3 For the cost of direct loans, loan guarantees, and grants for the rural water, waste water, waste. disposal, and solid waste management programs authorized by sections 306, 306A, 306C, 306D, 306E, and 310B and described in sections 306C(a)(2), 306D, 306E, and 381E(d)(2) of the . Consolidated Farm and Rural Development Act, [$568,730,00018534,414,000, to remain available until expended, of which not to exceed $497,000 shall be available for the rural utilities program described in section 306(a)(2)(B) of such Act, and of which not to exceed $993,000 shall be available for the rural utilities program described in section 306E of such Act: Provided, That [$70,000,0001865,000,000 of the amount appropriated under this heading shall be for loans and grants including water and waste disposal systems grants authorized by 306C(a)(2)(B) and 306D of the Consolidated Farm and Rural Development Act, Federally-recognized Native American Tribes authorized by 306C(a)(1), and the Department of Hawaiian Home Lands (of the State of Hawaii): [Provided further, That not less than $65,000,000 of the unobligated balances available for grants authorized by 306D of the Consolidated Farm and Rural Development Act shall be obligated within 90 days of the enactment of this Act: Provided further, That not to exceed [$19,500,000]$19,000,000 of the amount appropriated under this heading shall be for technical assistance grants for rural water and waste systems pursuant to section 306(a)(14) of such Act, unless the Secretary makes a determination of extreme need, of which $6,000,000 shall be made available for a grant to a qualified non-profit multi-state regional technical assistance organization, with experience in working with small communities on water and waste water problems, the principal purpose of such grant shall be to assist rural communities with populations of 3,300 or less, in improving the planning, financing, development, operation, and management of water and waste water systems, and of which not less than $800,000 shall be for a qualified national Native American organization to provide technical assistance for rural water systems for tribal communities: Provided further, That not to exceed [$15,000,000];14,000,000 of the amount appropriated under this heading shall be for contracting with qualified national organizations for a circuit rider program to provide technical assistance for rural water systems: Provided further, That of the amount appropriated under this heading, the amount equal to the amount of Rural Water and Waste Disposal Program Account funds allocated by the Secretary for Rural Economic Area Partnership Zones for the fiscal year [2009|2010, shall be available through June 30, [2010]2011, for communities designated by the Secretary of Agriculture as Rural Economic Area Partnership Zones for the rural utilities programs described in section 381E(d)(2) of such Act: [Provided further, That $17,500,000 of the amount appropriated under this heading shall be transferred to, and merged with, the Rural Utilities Service, High Energy Cost Grants Account to provide grants authorized under section 19 of the Rural Electrification Act of 1936 (7 U.S.C. 918a): Provided further, That any prior year balances for high cost energy grants authorized by section 19 of the Rural Electrification Act of 1936 (7 U.S.C. 918a) shall be transferred to and merged with the Rural Utilities Service, High Energy Costs Grants Account: JProvided further, That section 381E-H and 381N of the Consolidated Farm and Rural Development Act are not applicable to the funds made available under this heading: Provided further, That any prior balances in the Rural Development, Rural Community Advancement Program account programs authorized by sections 306, 306A, 306C,306D, 306E, and 310B and described in sections 306C(a)(2), 306D, 306E, and 381E(d)(2) of such Act be transferred and merged with this account and any other prior balances from the Rural Development, Rural Community Advancement Program account that the Secretary determines is appropriate to transfer. The first change removes the language requiring an obligation of unobligated balances within a specific timeframe. 563 29-6 The second change reflects the change of the fiscal year the designation of set-aside for Rural Economic Area Partnership Zones funds is formulated by. The third change modifies the expiration date of set-aside funds for rural economic area partnership zones from June 30, 2010, to June 30, 2011. - The fourth change eliminates the High Energy Cost grants since the program has been funded in previous years and unobligated funds are available for this purpose. 564 29-7 RURAL UTFLITIES SERVICE Analysis of Change in Appropriation RURAL WATER AND WASTE DISPOSAL PROGRAMACCOUNT (On basis of loan level, subsidy, and grants) - - Loan Level Subsidy Grants Appropriations Act, 2010........................... $1,097,161,804 $77,071,000 $474,159,000 Budget Estimate, 2011............................... 1,111,293,707 88,914,000 445,500,000 Increase or decrease in Appropriations............ 14,131,903 11,843,000 –28,659,000 3. PROJECT STATEMENT (On basis of supportable loan levels and appropraited subsidies and grants) (In thousands of dollars) 2009 Actual 2010 Estimated Increase or Decrease 2011 Estimated Item of Change Program LevelSubsidy/BA Program Levelsubsidy/BAI Program Lowell Subsidy/BA |Program Level Subsidy/BA Rural Water and Waste Disposal Programs: - - Direct loans $554,095 $81,009; $1,022,162 $77,071 $14,132 (1) $11,843 (2) $1,036,294 $88,914 Direct loans - ARRA g/........ 991,645 144,978 0 () () - () 0 0. Direct loans 2008 disasters em supp, f/.......... 17,726 2,592 O 0 0 0 0 0. Guaranteed loans a ſ 1,996 0 75,000 () () {} 75,000 0. Grants r 237,782 237,782 351,728 351,728 –9,218 -9,218 (3) 342,510 342,510 Grants - ARRA g/ 585,603 585,603 0 0 () () {} 0 Grants - May 6, 2007 disasters em. Supp. e. f... () () 0 0| {} 0 0 0 Grants - 2008 disasters em. Supp. fſ...............! 11,147 11,147 0 0| 0 - {} 0 0 Technical assistance grants for . - - rural waste systems.............................. 19,532 19,532 19,500 19,500 -500 -500 (3) 19,000 19,000 Technical assistance grants for - rural waste systems - ARRA g/................ {} () () () 0 0 0 0. Circuit rider- technical assistance - - grants for rural water systems.................. 13,592 13,592 15,000 15,000 -1,000 -1,000 (3) 14,000 14,000 Circuit rider - technical assistance - - . grants for rural water systems - ARRAg/... 4,100 4,100 0 - 0 * 0 0 () 0 WWD grants, Alaskan villages.................. 10,289 10,289 24,500 24,500 -5,000 -5,000 (3) 19,500 19,500 WWD grants, native American tribes.........., 15,549 15,549 16,000 16,000 {} 0 16,000 16,000 Water and waste disposal grants, colonias..... 24,545 24,545 24,500 24,500 0 {) 24,500 24,500 WWD grants, Hawaiian homelands............. {} 0 5,000 5,000 0 0 5,000 5,000 Grants - 2003/2004 hurricane em. Supp. b. ſ.... {} 0 0} . 0 {} {) O 0 Grants - 2005 hurricane em. Supp. c./.............. 5,330 5,330 0 0 0 {) 0 0 Water well system grants 993 993 993 993 0 {} 993 993 Water and wastewater revolving funds......... 496 496 497 497 | () 0 497 497 Solid waste management grants......................] 3,465 3,465| 3,441 3,441 59 59 (4) 3,500 3,500 Emergency and imminent community - - water assistance grants 4,540 4,540 13,000 13,000 -13,000 -13,000 (5) 0 Ö Emergency community water assistance - grants - emergency supplemental - {} 0 () () 0 0 • 0 0 Emergency community water assistance - + - grants - 2005 hurricanes em. Supp. c.ſ........ {} {}|. 0 0 () () {} 0 High energy costs grants d/..............…. ~ 0 0 () 0 0 () 0 0 ; # PROJECT STATEMENT (On basis of supportable loan levels and approprajted subsidies and grants) (In thousands of dollars) 2009 Actual 2010 Estimated Increase or Decrease 2011 Estimated Item of Change Program LevellSubsidy/BA |Pro LevelSubsidy/BA | Program Level | Subsidy/BA |Program Level Subsidy'BA Total Available or Estimate 2,502,424| 1,165,541 1,571,321 551,230 -14,527 -16,816 1,556,794 534,414 Total administrative expenses - ARRA g/........, 0 41,400 0 0 0 0 () () Total administrative expenses - 2008 - disasters f/........................................ 0 0 0 0 0 0 0 () Transfer to high energy cost grants d/ 17,500 17,500 17,500 17,500 -17,500 -17,500 0 () Transfer of unobligated balances -67,590 -26,000 0 0 0 O 0 0 Recovery of prior year obligations.................. -31,961 -47,556 0 () 0 0 {} () Unobligated balance available, start of year......... -140,913 -109,231 0 0 0 0 {} () Unobligated balance expiring.......................... 73,004 0 0 0 0 0 0 () Unobligated balance available, end of year... 2,743,386 894,614 0 0 0 0 0 () ARRA Appropriation g (............................. -3,672,476] -1,380,000 () 0 () 0 () () Total Appropriation 1,423,375 556,268 1,588,821 568,730 -32,027 -34,316 1,556,794 534,414 NOTE: Amounts reflected above are budget projections of use of funds within the Water and Waste Disposal Program Account. The justification of increases and decreases is based on the projected use of funds. Individual columns may not add due to rounding. § #. PROJECT STATEMENT (On basis of obligations under available funds) (In thousands of dollars) 2009 Actual 2010 Estimated Increase or Decrease 2011 Estimated Item of Change Program Level Subsidy/BA |Program Level Subsidy/BA |Program Levell Subsidy/BA Program Level Subsidy/BA Rural Water and Waste Disposal Programs: Direct loans $554,095 $81,009 $1,781,492 $134,324 -$745,198 -$45,410 $1,036,294 $88,914 Direct loans - ARRA g/ 991,645 144,978 1,167,103 88,000 -1,167,103 -88,000 0 () Direct loans 2008 disasters em supp. ff.......... - 17,726 2,592 61,783 4,658 -61,783 –4,658 {) 0 Guaranteed loans a / 1,996 0 75,000 0 () 0 75,000 0 Grants 237,782 237,782 478,722 478,722 -136,212 -136,212 342,510 342,510 Grants - ARRA g/ - 585,603 585,603 500,539 500,539 -500,539 -500,539 () 0 Grants - May 6, 2007 disasters em. Supp. e. f... 0 0 1,000 1,000 -1,000 -1,000 0 0 Grants - 2008 disasters em. Supp. f/............... 11,147 11,147 5,853 5,853 -5,853 -5,853 () 0. Technical assistance grants for - rural waste systems.............................. 19,532 19,532 19,999 19,999 -999 -999 19,000 19,000 Technical assistance grants for - rural waste Systems - ARRA g/................ 0 0 5,000 5,000 –5,000 -5,000 0 0 Circuit rider - technical assistance - - grants for rural water systems.................. 13,592 13,592 15,408 15,408 -1,408 -1,408 14,000 14,000 Circuit rider - technical assistance - - grants for rural water systems - ARRA g/.... 4,100 4,100 10,180 10,180 -10,180 -10,180 0. 0 WWD grants, Alaskan villages.................. 10,289 10,289 98,857 98,857 –79,357 -79,357 19,500 19,500 WWD grants, native American tribes........... 15,549 15,549 16,509 16,509 -509 -509 16,000 16,000 Water and waste disposal grants, colonias..... 24,545 24,545 27,600 27,600 -3,100 –3,100 24,500 24,500 WWD grants, Hawaiian homelands............. 0 0 5,000 5,000 () 0 5,000 5,000 Grants - 2003/2004 hurricane em. supp, b /..... 0. * 0 3,093 3,093 –3,093 -3,093 {) 0 Grants-2005 hurricane em. Supp. c.ſ.............. 5,330 5,330 6,607 6,607 , -6,607 -6,607 0 0 Water well system grants 993 993 993 993 {} 0 993 993 Water and wastewater revolving funds......... 496 496 498 498 -1 -1 497 497 Solid waste management grants......................! 3,465 3,465 3,750 3,750 -250 -250 3,500| 3,500 Emergency and imminent community - - * * Water assistance grants 4,540 4,540 13,360 13,360 -13,360 -13,360 (? 0 Emergency community water assistance - grants - emergency supplemental.................. 0 () 190 190 -190 -190 0. 0 Emergency community water assistance t - - grants - 2005 hurricanes em. Supp. c.f........ - 0. 0 4,953 4,953 -4,953 –4,953 0 0 High energy costs grants d/...…... 0 0 0 0 {} O {} 0 . #. PROJECT STATEMENT (On basis of obligations under available funds) (In thousands of dollars) 2009 Actual 2010 Estimated Increase or Decrease 2011 Estimated Item of Change Program Level Subsidy/BA |Program Level Subsidy/BA |Program Level Subsidy/BA |Program Lovel Subsidy/BA Total Available or Estimate 2,502,424| 1,165,541 4,303,490. 1,445,094 -2,746,696 –910,680 1,556,794 534,414 Total administrative expenses - ARRA g/......... () 41,400 () 0 () 0 () 0 Total administrative expenses - 2008 - disasters f/........................................ 0 0 0 750 () -750 () 0 Transfer to high energy cost grants d/.................. 17,500 17,500 17,500 17,500 -17,500 -17,500 () 0 Transfer of unobligated balances -67,590 –26,000 0. O () 0 0 O Recovery of prior year obligations.................. -31,961 -47,556 -2,746,822 –894,614 2,746,822 894,614 () 0 Unobligated balance available, start of year......... - -140,913 -109,231 0 0 () O 0. {) Unobligated balance expiring......................... 73,004 0 0. 0 () 0 0 0. Unobligated balance available, end of year... 2,743,386 894,614 () 0 () 0 0 0 ARRA Appropriation g/............................. -3,672,476 -1,380,000 () 0 () 0 , () 0. Total Appropriation 1,423,375 556,268 1,574,168 568,730 -17,374 -34,316 1,556,794 $34,414 NOTE: Amounts reflected above are budget projections of use offinds within the Water and Waste Disposal Frogram. Account. The justification of increases and decreases is based on the projected use of funds. Individual columns may not add due to rounding. g 569 29-12 Project Statement Footnotes d/ Negative subsidy rate of 0.82 percent was calculated for FY 2009, FY 2010 and a negative subsidy rate of 0.85 percent was calculated for FY 2011. Therefore, corresponding budget authority is not required to support the loan levels. Provided by the Emergency Supplemental Appropriations for Hurricanes Disasters Assistance Act of 2005, P.L. 108-324, signed October 13, 2004, for the purpose of serving communities affected by hurricanes and tropical storms in calendar year 2003 or 2004. - Provided by the Department of Defense, Emergency Supplemental Appropriations to Address Hurricanes in the Gulf of Mexico, and the Pandemic Influenza Act, 2006, P.L. 109-148, signed December 30, 2005, for the purpose of serving communities affected by hurricanes that occurred during the 2005 calendar year. This program was transferred to the Rural Utilities Service, High Energy Cost Grant Account in accordance with the Omnibus Appropriations Act, 2009 and the Agriculture, Rural Development, Food and Drug Administration, and Related Agencies Appropriations Act, 2010. Transfer of unobligated balances in the amount of $1 million from the funds provided by the U.S. Troop Readiness, Veterans' Care, Katrina Recovery, and Iraq Accountability Appropriations Act, 2007, P.L. 110-28, signed May 25, 2007, for areas in Kansas hit by the tornadoes on May 6, 2007, to water and waste disposal grants. Transfers from the Rural Development Disaster Assistance Fund provided by the Consolidated Security, Disaster Assistance, and Continuing Appropriations Act, 2009, P.L. 110-329 in the amount of $25 million. Provided by the American Recovery and Reinvestment Act (ARRA) of 2009, P.L. 111-5, signed February 17, 2009, for the purpose of making supplemental appropriations for job preservation and creation, infrastructure investment, energy efficiency and science, assistance to the unemployed, and State and local fiscal stabilization. The funds are available through the fiscal year ending September 30, 2010, - 570 (1) (2) (3) (4) (5) 29-13 JUSTIFICATION OF INCREASES AND DECREASES An increase of $14,131,903 in direct water and waste disposal loans ($1,022,161,804 available in 2010). † * - These loans are targeted to communities with the most urgent needs for basic water improvements and wastewater infrastructure. Because of the relatively low interest rates on loans, more projects are feasible with less grant funds required and the overall program should be able to operate at a higher loan to grant ratio. In addition, the program is contributing to the new Regional Innovation Initiative which focuses planning and coordination of USDA and other sources of assistance for rural communities, allowing for communities with the same region working together instead of independently produce more prosperity for all communities involved. An increase of $11,843,000 in the loan subsidy for the direct water and waste disposal loans ($77,071,000 available in 2010). The requested subsidy amount is necessary to support the estimated loan obligations associated with the requested FY 2011 loan levels for the direct water and waste disposal loan program. The change is due to the subsidy rate increases from 7.54 percent to 8.58 percent due to the projected interest rates for the FY 2011 President's Budget economic assumptions. - A decrease of $15,718,000 in rural water and waste disposal grants ($410,728,000 available in 2010). Because of the relatively low interest rates on loans, more projects are feasible with less grant funds required and the overall program should be able to operate at a higher loan to grant ratio. State directors have the flexibility to better utilize limited funding by transferring up to 25 percent between loan and grant funds. This flexibility allows funds to be directed to meet State and local priorities. In addition, the funding for FY 2011 will be sufficient to meet Technical Assistance, Circuit Rider, and the Federally recognized Tribes, Alaskan Villages and Hawaiian Homeland needs. The decrease in these set-asides puts funds back in the general program. An increase of $59,000 in solid waste management grants ($3,441,000 available in 2010). The request continues support for the program which normally receives high levels of demand. A decrease of $13,000,000 in emergency and imminent community water assistance grants ($13,000,000 available in 2010). For the emergency and imminent community water assistance grants, the budget maintains flexibility to transfer funding among programs, in the Water and Waste Disposal Program. Account. This flexibility allows funds to be directed to meet local priorities, 571 Alabama Alaska Arizona Arkansas California Colorado Connecticut Pelaware Florida Georgia Hawaii Idaho Illinois Indiana Iowa Kansas Kentucky Louisiana Maine Maryland Massachusetts Michigan Minnesota Mississippi Missouri Montana Nebraska Nevada New Hampshire New Jersey Mew Mexico New York North Carolina. North Dakota Ohio Oklahoma Oregon Pennsylvania Rhode Island South Carolina South Dakota Tennessee Texas Utah Vermont Virginia Washington West Virginia Wisconsin Wyoming Puerto Rico Virgin islands W. Pacific Areas {jndistributed Total Avail./Est. 29-14 RURAL. UTILITIES SERVICE GEOGRAPHIC BREAKDOWN OF OBLIGATIONS 2009 Actual and Estimated 2010 and 2011 Rural Water and Waste Disposal Loan Program - Direct 2009 2019 2011 $46,927,100 $29,729,000 $20,360,000 ** 8,298,000 6,956,000 *g, * 17,569,000 ii,591,000 16,341,000 21,271,000 13,442,000 16,764,000 31,555,000 18,584,000 ** 14,380,000 9,997,000 3,836,000 9, 193,000 7,403,000 9,216,065 7,108,000 6,361,000 8,684,000 30,777,000 18, 195,000 -- . 38,419,000 22,014,000 4,047,000 7,467,000 6,540,000 7,680,000 11,007,000 8,310,000 f7,197,400 25,614,000 15,614,000 5,748,000 26,275,000 15,944,000 6,156,000 17,632,000 I 1,623,000 15,491,000 13,354,000 9.482,000 22,945,000 30,644,000 18,129,000 13,953,000 20,551,000 13,082,000 9,244,000 13,872,000 9,743,000 4,135,600 11,995,000 3,404,000. 7,731,000 8,983,000 3,998,000 31,843,000 37.584,000 21,598,000 20,183,000 22,273,000 13,943,000 15,668,150 27,223,000 16,418,000 18,243,255 26,634,000 ió,124,000 8,658,000 10,749,000 8,181,000 9,190,000 10,914,000 8,264,000 754,000 9,800,000 7,707,000 1,025,000 10,042,000 7,828,000 6,758,000 8,922,000 7,268,000 5,517,541 11,311,000 8,462,000 11,353,000 29,795,000 17,704,000 28,471,000 42,025,000 23,818,000 6,558,350 7,941,000 6,777,000 9,195,000 36,872,000 21,243,000 4,999,800 19,521,000 12,567,000 2,726,900 15,360,000 10,487,000 20,522,100 34,814,000 20,213,000 tºº 5,624,000 5,620,000 16,182,900 27,485,000 16,549,000 1,912,500 9,327,000 7,470,000 22,195,000 33,638,000 19,626,000 26,476,700 42,029,000 23,320,000 5,336,000 8,734,000 7,174,000 3,159,000 9,532,000 7,573,000 22,161,200 26,450,000 ió,032,000 37,620,600 17,949,000 11,782,000 17,763,500 15,578,000 10,596,000 1,985,000 23,967,000 14,790,000 *se 7.148,000 6,381,000 11,540,000 10,570,000 8,092,000 rººs 830,000 3.222,000 tºº 830,000 3,222,000 ** North Carolina 3,160,000 **** * North Dakota i4,425,800 ** gº Ohio 22,281,000 tºº sº Oklahoma 18,641,440 º sº Oregon 26,940,000 wº-- smº Pennsylvania 36,240,150 * ** Rhode Island 386,000 * * South Carolina 38,973,300 sº dº South Dakota 29,377,000 . sº-> dº Tennessee 13,071,000 •ºr ** Texas 20, 176,330 wººl ** Utah 5,569,000 º wº- Vermont 12,571,200 Asºº sº Virginia 30,078,000 sº ** Washington 36,849,000 . wº tº- West Virginia 52,772,000 sº *g as Wisconsin 11,830,000 *& sº Wyoming sº dº e-ºf * Puerto Rico 13,534,000 ** tººl Virgin Islands egº wºrsº * W. Pacific Areas 88,536,000 * 3- Undistributed ºvº tºº *wēºr Totai Avail./Est. $39,644,191 3,167,192,713 1/ l! Cannot be distributed by geographic area in advance. 573 29–16 RURALUTILITIES SERVICE GEOGRAPHICBREAKDOWN OF OBLIGATIONS 2009 Actual and Estimated 2010 and 2011 Rural Water and Waste Disposal Loans 2008 Disasters 2009 2010 Arkansas $413,000 sº wº Hlinois 845,000 tº ºr Iowa 1,541,000 tº sº. Maine 253,000 ºs ºs Mississippi 411,000 -- Missouri 4,199,000 Rºº-ºº! Nebraska 146,000 4&ſº Ohio 503,000 mºnº Texas 9,415,000 & Cº. Total Avail./Est. $17,726,000 $61,783,273 1/ iſ . Cannot be distributed by geographic area in advance. 574 29-17 RURAL. UTILITIES SERVICE GEC GRAPHC BREAKDOWN OF QBłIGATIONS 2009 Actual and Estimated 2010 and 2011 Rural Water and Waste Disposal Loan Program - Guaranteed Alabama ** - $1,532,000 $1,532,000 Alaska ** 924,000 924,000 Arizona - ** 1,187,000 1,187,000 Arkansas - sº 1,292,000 1,292,000 California $346,400 1,583,000 1,583,000 Colorado - – 1,096,000 1,096,000 Connecticut – 949,000 949,000 Delaware ** 890,000 390,000 Florida — 1,561,000 1,561,000 Georgia * 1,773,000 1,778,000 Hawaii sº 900,000 900,000 Idaho - 1,000,000 1,000,000 Illinois sº. “ 1,415,000 1,415,000 Indiana * 1,434,000 - i,434,000 Iowa º 1,188,000 - 1,188,000 Kansas * 1,067,000 1,067,000 Kentucky º 1,558,000 - 1,558,000 Louisiana - *º - 1,271,000 1,271,000 Maine ºjº- 1,082,000 - 1,082,000 Maryland -º- #,028,000 1,028,000 Massachusetts * 943,000 - 943,000 Michigan * 1,755,000 1,755,000 Minnesota * - 1,320,000 1,320,000 Mississippi . - * #,464,000 1,461,000 Missouri * 1,444,000 1,444,000 Montana * 993,000 993,000 Nebraska wºw 998,000 998,000 Nevada ... ºr 966,000 966,000 New Hampshire * 973,000 973,000 New Jersey • ** 941,000 941,000 New Mexico * 1,009,000 1,009,000 New York *** 1,534,000 1,534,000 North Carolina wºr- 1,881,000 1,831,000 North Dakota 1,250,000 913,000 913,000 Ohio * 1,734,000 1,734,000 Oklahoma *** 1,242,000 1,242,000 Gregon * * 1,124,000 - 1,124,000 Pennsylvania **** 1,676,000 1,676,000 Rhode Island ** 848,000 848,000 South Caroling º ł,468,000 1,468,000 South Dakota - – 953,000 953,000 Tefinessee - as-wº 1,643,000 1,643,000 Texas * 1,378,000 1,878,000 {jtah wº 936,000 936,000 Vermont sº 959,000 959,000 Virginia ** 1,439,000 1,439,000 Washington 400,000 1,197,000 1,197,000 West Virginia *** 1,130,000 1,130,000 Wisconsin * - 1,368,000 t,368,000 Wyoming sº 891,000 391,000 Puerto Rico — 988,000 988,000 Virgin Island - sº-g 830,000 830,000 W. Pacific Areas - 830,000 830,000 Undistributed * 10,000,000 10,000,000 Total Avail/Est. $1,996,100 $73,000,000 $75,000,000 575 29-18 RüRAL UTILITIES SERVICE GEOGRAPHHC BREAKDOWN OF OBLIGATIONS 2009 Actual and Estimated 2010 and 2011 Rural Water and Waste Disposal Grants 2009 2010 2011 Aſabalna $1,894,575 $10,095,000 5,047,000 Alaska 11,635,927 2,820,000 1,410,000 Arizoria 4,153,465 5,967,000 2,984,000 Arkansas -5,972,000 7,223,000 3,612,000 California 9,958,200 10,714,000 5,357,000 Colorado 24,300 4,884,000 2,442,000 Connecticut 1,548,000 3,123,000 1,562,000 Delaware 3,121,272 2,416,000 1,208,000 Florida 5,015,280 10,450,000 5,225,000 Georgia ** 13,044,000 6,522,000 Hawaii 1,773,905 2,538,000 i.269,000. Idaho 3,565,000 3,739,000 1,870,000 Hiinois 7,590,715 8,698,000 4,349,000 Indiana 1,130,250 8,922,000 4,461,000 fowa 4,116,500 5.988,000 29,994,000 Kansas 7,022,700 4,535,000 2,267,000 Keritucky 8,758,427 10,405,000 5,202,000 Louisiana 8,473,249 6,979,000 3,490,000 Maine 9,275,000 4,712,000 2,356,000 Maryland 10,357,257 4,075,000 2,038,000 Massachusetts 1,849,975 3,052,000 1,526,000 Michigan 14,423,000 12,761,000 6,381,000 Minnesota 6,891,500 7,563,000 3,782,000 Mississippi 9,997,950 9,244,000 4,622,000 Missouri 8,242,300 9,044,000 4,522,000 Moritaria 4,919,380 3,651,000 1,826,000 Nebraska 5,421,000 3,708,000 1,854,000 Nevada 1,104,674 3,329,000 1,665,000 New Hampshire 2,975,000 3,411,000 1,706,000 New Jersey 3,219,000 3,031,000 1,516,000 New Mexico 12,859,637 3,842,000 1,921,000 New York 10,189,224 10,117,000 5,059,000 North Carolina 10,005,300 14,268,000 7,134,000 North Dakota 3,075,000 2,698,000 1,349,000 Ohio 6,715,000 12.519,000 6,259,000 Oklahoma 25,727,815 6,629,000. 3,315,000 Oregon 2,191,626 5,217,000 2,609,000 Pennsylvania 13,258,610 11,821,000 5,911,000 Rhode island 509,700 1,912,000 956,000 South Carolina 7.942,400 9,333,000 4,667,000 South Dakota 1,714,000 3,169,000 1,585,000 Tennessee 8,663,400 11,421,000 5,711,000 Texas 19,236,296 14,269,000 7,135,000 Utah 1,023,250 2,968,000 1,484,000 Verºnont 2,500,000 3,238,000 1,619,000 Virginia 10,945,800 8,981,000 4,491,000 Washington 4,210,000 6,096,000 3,048,000 West Virginia 8,924,828 5,291,000 2,646,000 Wisconsin 2,465,630 8,138,000 4,069,000 Wyoming 813,000 2,429,000 1,215,000 Puerto Rico 3,888,000 3,591,000 1,796,000 Virgin Islands * 830,000 415,000 W. Pacific Areas * 830,000 415,000 Undistributed tºte 317,366,498 238,636,000 Totai Avail./Est. $321,232,417 $657,094,493 $435,510,000 576 29-19 RURAL. UTILITIES SERVICE GEOGRAPHIC BREAKDOWN OF GBLIGATIONS 2009 Actual artd Estimated 2010 and 2011 Rural Water and Waste Disposal Grants - Recovery Act 2009 2010 2011 Alabama $5,122,000 tº em ** Alaska 3,273,500 {-º-, *** Arizona 16,841,448 ** * * Arkansas 6,711,000 * – California 6,346,350 ** * Colorado sºrº: * ** Connecticut 15,349,490 tºº ** Delaware 2,136,000 * * Florida 7,065,700 sº- * Georgia 3,663,000 mº ~ Hawaii 716,800 sº &ºe Idaho 2,615,000 *gg &ºt Illinois 3,149,000 sº º Indians 31,596,200 tºº tºº Iowa 3,948,000 gº sºs Kansas 18,574,500 *çº * Kentucky 6,640,760 frºm * £ouisiana 3,652,220 wºrº * Maine 18,444,000 tºº ** Maryland 1 i,829,697 sº -- *Massachusetts 666,000 ** ** Michigan 59,357,000 tºº sº Minnesota 20,202,000 *** *º Mississippi 7,932,756 <-º *º Missouri 27,778,034 sº - Montana 4,598,600 tºº *º Nebrasks 495,000 * wrº Newsda egºs * wº- New Hampshire 16,143,000 wº wº- New Jersey 6,993,000 gº º New Mexico 11,252,280 º & New York 40,974,830 * *** North Carolina 2,600,000 tº-º-F *º North Dakota 7,792,760 * ºn *se Ghio 22,420,000 gº tº sº Oklahoma 24,037,850 ** º Oregon 20,220,300 ** * Pennsylvania 2,988,960 sº sº Rhode Island 295,000 ** South Carolina 18,938,200 tºº South Dakota 12,455,000 gº Tennessee 4,373,300 tº: wºw Texas 6,856,630 * ** ŁJtah 3,603,000 tº ºn º Vermont 18,385,100 sº tºº Virginia 15,277,600 tºº tºº. Washington 8,478,000 se sºf sº tº West Virginia 22,358,800 ** *** Wisconsin 8,360,900 sºs tº tº Wyoming gººse sº tºº: Puerto Rico 7,224,642 ** *º Virgin Islands gº * *º W. Pacific Areas 15,019,300 - rº. Undistributed zºº tº tºº Total Avail./Est. $585,802,947 $500,539,053 iſ use ºf 577 29-20 RURAL. UTILITIES SERVICE GEOGRAPHIC BREAKDOWN OF OBLIGATIONS 2009 Actual and Estimated 2010 and 2011 Rural Water and Waste Disposal Grants Technical Assistance Grants for Rural Waste Systems - Recovery Act 2009 2010 2011 Total Avail./Est. tº ºn $5,000,000 1/ Circuit Rider Technical Assistance Grants for Rural Water Systems - Recovery Act 2009 2010 2011 Oklahoma $4,100,333 -- tº-ºxº Total Avail./Est. $4,100,333 $10,179,666 1/ tº mº Cannot be distributed by geographic area in advance. 578 29-21 RURAL. UTILITIES SERVICE GEOGRAPHICBREAKDOWN OF OBLIGATIONS 2009 Actual and Estimated 2010 and 2011 Rural Water and Waste Disposal Grants for Natural Disaster 2009 2010 2011 Total Avail./Est. * $40,556 1/ * Rural Water and Waste Disposal Grants - Stimulus 2003/2004 for Hurricanes Disasters 2009 2010 2011 Total Avail./Est. *º $3,052,784 1/ *s := :-------- Rural Water and Waste Disposal Grants 2005 for Hurricanes for Natural Disaster 2009 2010 2011 Louisiana $463,230 * * ** Texas 4,867,000 &aſſº sº gº Total Awaii, WEst. $5,330,230 $6,607.357 1/ sº >==::--> :-º: : Rural Water and Waste Disposal Grants 2007 Tornados Disasters 2009 2010 2011 Total Awaii./Est. *ºgº $1,000,000 1/ * ==: Rural Water and Waste Disposal Grants -2008 Disasters 2009 2010 2011 Arkansas $188,000 •ºmºy *rºp California 722,500 º &ºe Hlinois 271,000 * * Howa 1,618,300 mºnº ** Louisiana 218,000 * * Maine 747,000 *** ** Mississippi 1,211,000 *sº * * Missouri 395,000 wº ** Nebraska 746,800 wºrvº, &º Ohio 410,000 yºtº ** Texas 4,619,000 **º *ſº Total Avail./Est. $11,146,600 $4,658,459 I/ *sº 1/ Cannot be distributed by geographic area in advance. 579 29-22 RURAL. UTILITIES SERVICE GEOGRAPHIC BREAKDOWN OF OBLIGATIONS 2009 Actual and Estimated 2010 and 2011 Rural Water and Waste Individually-Owned Water Well System Grants 2009 2010 2011 California - $100,000 * * ust tº Georgia 100,000 - sº, ºk. º ºr Minnesota 144,000 tº gº sº º Ohio 149,000 ºtº º ºg Tennessee 100,000 as tº wº: ºp Virginia 300,000 tº tº a tº ºn Wisconsin 100,000 ge tº sº tº Total Avail./Est. $993,000 $993,000 l/ $993,000 1/ Rural Water and Wastewater Revolving Fund Grants 2009 2010 - 2011 Arkansas $496,000 ** * Jºpºs Total Avaii./Est. $496,000 $498,000 l/ $497,000 1/ I Cannot be distributed by geographic area in advance. 580 29-23 RURAL. UTILITIES SERVICE GEOGRAPHIC BREAKDOWN OF OBLIGATIONS 2009 Actual and Estimated 2010 and 2011 Solid Waste Management Grants 1/ Cannot be distributed by geographic area in advance. 2009 2010 2011 Alaska $698,000 tº wº wºuxº Arizona 210,000 ** ºxº California 246,000 3- - - sº Colorado 100,000 tº º sº ſº Florida 98,000 tº sº ºrº Iowa 98,000 tº ºr *º Louisiana . 95,000 x-º * Jºe Maine 184,000 sº-º-º: smººs Massachusetts 90,000 *ºr ºn tº Michigan 100,000 as at ** Minnesota 100,000 --- - iº Missouri 50,000 *-r * ºr Nevada 198,000 *** Tºº New Mexico 40,000 ahaºr i-sº New York 58,000 tº º ºv : North Carolina 110,000 tº gº ** Ohio 99,000 t-nº &ººl Oklahoma 78,000 wº- {-, -º Pennsylvania 235,000 ** tº gº Texas 130,000 tº ºt * ºt Vermont 200,000 º Gº tº Washington 68,000 - tº º West Virginia 180,000 amºng tº e Total Avail/Est. $3,465,000 $3,749,939.1/ $3,500,000 581 1 29-24 RURAL. UTILITIES SERVICE GEOGRAPHICBREAKDOWN OF OBLIGATIONS 2009 Actual and Estimated 2010 and 2011 Emergency and Imminent Community Water Assistance Grants 2009 2010 Alabama $54,600 tº ºn Idaho 15,000 wº- Missouri 574,000 --> Nebraska 1,177,000 tº ºr Nevada 500,000 tº º Oklahoma 500,000 - **p. Oregon 126,000 * * Tennessee 925,000 tº wº Texas 85,000 - *w- Washington 583,000 --. Total Avail./Est. $4,539,600 $13,360,399 1/ Emergency and Imminent Community Water Assistance Grants for Natural Disaster 2009 2010 Total Avail./Est. mººn $189,987 1/ Emergency and Imminent Community Water Assistance Grants 2005 Hurricanes for Natural Disaster 2 00 2010 Total Avail./Est. tº-wº $4,953,300 1/ Cannot be distributed by geographic area in advance. 2 0 1 1 **** 2 I l 582 29-25 RURAL. UTILITIES SERVICE GEOGRAPHICBREAKDOWN OF OBLIGATIONS 2009 Actual and Estimated 2010 and 2011 Rural Water and Waste Disposal Program Hawaiian Homelands - 200 2010 - 20. Hawaii - tº $5,000,000 $5,000,00 Total Avail./Est. t-tººt $5,000,000 $5,000,00 583 29-26 RURAL, UTILITHES SERVICE RURAL WATER AND WASTE DISPOSAL PROGRAM ACCOUNT Classification by Objects 2009 Actual and Estimated 2010 and 2011 FY 2009 FY 2010 FY 2011 ther Objects: ; Other purchases of goods and services - from government accounts............... $41,400,000 $750,000 $0 | Grants, subsidies, and contributions...... 1,163.741.378 – 1445,094438 534414,000 tal direct obligations.......................... 1,207,141,578 1,445,844,438 534,414,000 584 29-27 RURAL. UTILITIES SERVICE The estimates include appropriation language for this item as follows (new language underscored; deleted matter enclosed in brackets): Rural Electrification and Telecommunications Loans Program Account (including transfer of funds) The principal amount of direct and guaranteed loans as authorized by sections 305 and 306 of the Rural Electrification Act of 1936 (7 U.S.C. 935 and 936) shall be made as follows: 5 percent rural electrification loans, $100,000,000; loans made pursuant to section 306 of that Act, rural electric, 1 [$6,500,000,000; guaranteed underwriting loans pursuant to section 313A, $500,000,000] $4,000,000,000; 5 percent rural telecommunications loans, $145,000,000; cost of money rural telecommunications loans, $250,000,000; and for loans made pursuant to section 306 of that Act, 2 rural telecommunications loans, $295,000,000: Provided, Thatſ, notwithstanding section 6106(b) of the Food, Conservation, and Energy Act of 2008, a guaranteed underwriting loan may not be issued. until the amendments to the Rural Electrification Act of 1936 contained in section 6106(a) of the 3 Food, Conservation, and Energy Act of 2008 are administratively implemented] no funds made available under this paragraph shall be made available for construction, acquisition or improvement. fossil fueled electric generating plants (whether new or existing) unless such funds are made availab for carbon sequestration systems. In addition, for administrative expenses necessary to carry out the direct and guaranteed loan programs, [$39,959,000]$38,374,000, which shall be [transferred to and merged with] paid to the appropriation for “Rural Development, Salaries and Expenses” The first change eliminates the funding for the 313A guaranteed underwriting loan program. The second change removes the language concerning implementation of changes in the guaranteed progra made due to the Farm Bill. The third change adds language reflecting the President’s 2009 G20 commitment to phase out fossil fuels subsidies. Loan funds will be used only for the transmission and distribution of electricity, carbon capture projects, and the generation of electricity from renewable sources, including wind. 585 29-28 RURALUTILITIES SERVICE Analysis of Change in Appropriation RURAL ELECTRIFICATION AND TELECOMMUNICATIONS ACCOUNT (On basis of loan level, subsidy, and grants) - º Administrative - Loan Level Subsidy Expenses ppropriations Act, 2010............................ $7,790,000,000 $0 $39,959,000 udget Estimate, 2011............................... 4,790,000,000 0 38,374,000 - –3,000,000,000 0 -1,585,000 ecrease in Appropriations......................... 3. PROJECTSTATEMENT (On basis of supportable loan levels and appropriated subsidies and grants) (In thousands of dollars) Electric Loans: Direct, 5% aſ Direct, FFB b/ Electric Underwriting Loans Total Electric Telecommunications Loans; Direct, 5% cf Direct, Treasury Rate hy Direct, FFB d/ $0 –2,500,000 (1 and 0 Total administrative expenses ef -1,585 (3) 38,374 Unobligated balance expiring 0 0 Transfer of unobligated balance Unobligated balance available, end of year may not to Staff-years are reflected in the Salaries and Expenses Project Statement ; 3. (On basis of obligations under available funds) PROJECT STATEMENT (In thousands of dollars) 2009 Actual 2010 Estimated Increase or Decrease 2011 Estimated Item of Change Program Levell Subsidy/BA |Program Levell Subsidy/BAi Program Level i Subsidy/BA |Program Levell Subsidy/BA Electric Loans: - Direct, 5% aſ $98,477 $0 $100,000 $0 $0 $0 $100,000 $0 Direct, FFB b/............................................ 6,500,000 {} 6,500,000 0 -2,500,000 () 4,000,000 {} Direct, FFB, loan modifications - 2005 - - - Hurricane Supplemental f/.................... 0 0 7,015 7,015 -7,015 -7,015 0 0. Direct, FFB, loan modifications - 2008 Disasters Supplemental g/..................... {} {} 970 970 -970 –970 0 {) Electric Underwriting Loans............................ {} 0 500,000 0|_-500,000 () 0. 0 Total Electric.......... & 6,598,477 Ö 7,107,985 7,985 -3,007,985 -7,985 4,100,000 () Telecommunications Loans: - Direct, 5%gſ........................................ 145,000 {} 145,000 0 0. () 145,000 0 Direct, Treasury Rate.............................. 250,000 525] 250,000 0 0. {} 250,000 () Direct, FFB d/...................................... 295,000 0 295,000 0 {} 0 295,000 () Total Telecommunications........................... d 690,000 525 690,000 0 () () 690,000 0 Total loans and subsidies............................. 7,288,477 525 7,797,985 7,985| -3,007,985 -7,985 4,790,000 0. Total administrative expenses eſ..................... 0 39,245 0 39,959 0 -1,585 {} 38,374 Total adminstrative expenses - 2008 **==== {} 0 30 30 -30 ~30 0 {} Unobligated balance available, start of year.......... 0 -7,015 -8,015 -8,015 8,015 8,015 0 0 Unobligated balance expiring........................ 1,523 0. 0 0 0. 0 0 0 Transfer of unobligated balance..................... i –970 -1,000 0. 0. 0 () 0 0 Unobligated balance available, end of year........ 970 8,015 () 0 () {} 0 0 Rescissinn {} () () 0 0 () {} 0. Total Appropriation - 7,290,000 39,770 7,790,000 39,959|_-3,000,000 -1,585 4,790,000 38,374 NOTE: Individual columns may not add due to rounding. Staff-years are reflected in the Salaries and Expenses Project Statement. : 588 f/ h/ 29-31 Negative subsidy rates of 2.38%, 27.73%, and 7.38% respectively, were calculated for FY 2009, FY 2010 and FY 2011. Therefore, corresponding budget authority is not required to support the program levels. Negative subsidy rates of 2.28%, 0.47%, and 4.43% respectively, were calculated for FY 2009, FY 2010 and FY 2011. Therefore, corresponding budget authority is not required to support the program levels Negative subsidy rates of 1.76%, 18.59%, and 7.37% respectively were calculated for FY 2009, FY 2010 and FY 2011. Therefore, corresponding budget authority is not required to support the program levels. Negative subsidy rates of 0.94%, 0.65%, and 4.65% respectively, were calculated for FY 2009, FY 2010 and FY 2011. Therefore, corresponding budget authority is not required to support the program levels. In FY 2009 and FY 2010, funding of $39,245,000 and $39,959,000 respectively, was appropriated and transferred to the Rural Development Salaries and Expenses account. In FY 2011, funding of $38,374,000 is requested and will be paid to the Rural Development Salaries and Expenses account. Provided by the Department of Defense, Emergency Supplemental Appropriations to address Hurricanes in the Gulf of Mexico and Pandemic influenza Act, 2006, P.L. 109-148, signed December 30, 2005, to respond to damage caused by hurricanes that occurred during the 2005 calendar years. Provided by the Consolidated Security, Disaster Assistance, and Continuing Appropriations Act, 2009, Division B - Disaster Relief and Recovery Supplemental Appropriations Act, 2008, P.L. 110- 329, dated September 30, 2008, the President declared major disaster, occurring during 2008, Negative subsidy rates of -0.4% and -4.43% respectively were calculated for FY 2009 and FY 2010. Therefor budget authority is not required to support program levels. 589 1) 2) 3) 29-32 JUSTIFICATION OF DECREASES A decrease of $2,500,000,000 in directelectric FFB loansfor 2011 ($6.500,000,000 available in 2010). - - The 2011 budget reflects the President’s 2009 G20 commitment to phase out fossil fuels subsidies. Consistent with this commitment, no loan funds are provided for new construction of base or peak load generation from coal or natural gas. Loan funds will be used only for the transmission and distribution of electricity, carbon capture projects, and the generation of electricity from renewable sources, including wind. The budget supports $4.1 billion in loans for these purposes, which is expected to be sufficient to meet the demand. Loans for nuclear power generation will continue to be handled by the Department of Energy. : A decrease of $500,000,000 in guaranteed electric underwriting Loans for bonds and notes 500,000,000 available in FY 2010). - ... " No funds are being requested for the program as it is duplicative of other programs. A decrease of $1,585,000 in administrative expenses ($39.959,000 available in 2010). Justifications for administrative expenses in the amount of $3 8,374,000 and the associated staff-years are reflected in the Rural Development Salaries and Expenses Project Statement. 590 29-33 RURAL. UTILITIES SERVICE GEOGRAPHICBREAKDOWN OF OBLIGATIONS 2009 Actual and Estimated 2010 and 2011 Electric Loans - Direct 5% 2009 2010 2011 California $8,032,000 4 ºf tº *** Iowa 11,600,000 dº tº º Kansas - 14,900,000 tº ºr ... •º Montana 2,467,000 tº ºr tºº North Carolina 24,000,000 ** º ºr Oklahoma 9,893,000 ** m-ºs Pennsylvania - 12,492,000 ** ºw Virginia 4,500,000 º -- Wyoming - 10,593,000 ** . rºws Total Avail./Est. $98,477,000. $100,000,000 1/ $100,000,000 1/ Cannot be distributed by geographic area in advance, 591 Alabama Alaska Arizona Arkansas California Colorado Delaware Florida . Georgia Idaho liiinois Indiana Iowa Kansas Kentucky Louisiana Maine Maryland Michigan Minnesota Mississippi Missouri Montana New Mexico North Carolina North Dakota Ohio Oklahoma Oregon Pennsylvania South Carolina South Dakota Tennessee Texas Vermont Virginia Washington Wisconsin Wyoming Total Avail./Est. Total Avail. Bst. 29-34 RURAL. UTILITIES SERVICE GEOGRAPHICBREAKDOWN OF OBLIGATIONS 2009 Actual and Estimated 2010 and 20I i Electric Loans - FFB 2009 $42,441,000 65,328,000 84,104,000 $32,329,000 20,928,000 144,585,000 21,000,000 290,846,000 938,754,000 72,408,000 $1,989,000 48,200,000 21,550,000 i49,775,000 591,239,000 229,872,000 10,485,000 88,898,000 14,000,000 145,319,000 233,190,000 554,670,000 58,285,000 67,593,000 i40,000,000 640,410,000 42,182,000 184,732,000 23,490,000 45,350,000 552,769,000 150,414,000 I 16,912,000 262,066,000 7,900,000 70,400,000 12,914,000 28,500,000 144,173,000 $6,500,000,000 $6,500,000,000 l/ Guaranteed Underwriting Loans 2009 11 Cannot be distributed by geographic area in advance. 2010 $500,000,000 J/ =rrºr ºs 592 29-35 RURAL. UTILITIES SERVICE GEOGRAPHIC BREAKDOWN OF OBLIGATIONS 2009 Actual and Estimated 2010 and 2011 Telephone Loans - Direct 5% and Treasury Rate 2009 2010 2011 Arizona $4,835,000 ** wº Arkansas 17,000,000 * = º Colorado 2,948,000 tº tº wº Illinois 27,335,000 * - * * Iowa 30,674,000 ** ** > Kansas 82,378,000 4×iº wº Kentucky 15,436,000 ** tº ge Montana 25,000,000 wº- Gº Nebraska 8,230,000 wºº. ºº: New Mexico 28,176,000 sºw & ** North Dakota 67,963,000 -- *** Ohio 10,124,000 *ś ** Oregon 5,631,000 wºsº. * = South Dakota 10,000,000 *tº * *ss Texas 5,947,000 * ºf sº Wisconsin 21,677,000 º was sº West Pacific 31,646,000 wºº. tºº Total Avail./Est. $395,000,000 $395,000,000 1/ $395,000,000 1. Telephone Loans FFB 2009 2010 2011 Illinois $1,050,000 *4 tº ** Iowa 41,548,000 3- tº º: E Kansas 64,951,000 wºme pºrºs Minnesota 7,949,000 wºº ** Mississippi 21,095,000 wºº *gº Montana 47,960,000 * * e- (Ohio 3,000,000 * * sº South Carolina 77,965,000 ** ºvº South Dakota 28,982,000 *** * *ºtºr Texas 500,000 . ** tºº Total Avail./Est, $295,000,000 $295,000,000 l/ $295,000,000 l/ 1/ Cannot be distributed by geographic area in advance. 593 29-36 RURAL. UTILITIES SERVICE RURAL ELECTRIFICATION AND TELECOMMUNICATIONS PROGRAM Classification by Objects 2009 Actual and Estimated 2010 and 2011 $39,959,000 0 FY 2011 $38,374,000 {} FY 2009 Other Objects: 25 Other purchases of goods and services from government accounts................. $39,245,000 41 Grants, subsidies, and contributions......... 525,000 Total direct obligations........................... … 39,770,000 39,959,000 38,374,000 594 29–37 RURALUTILITIES SERVICE The estimates include appropriation language for this item as follows (new language underscores; deleted matter enclosed in brackets): - Distance Learning, Telemedicine and Broadband Program [(including rescission of funds)] For the principal amount of broadband telecommunication loans, $400,000,000. For grants for telemedicine and distance learning services in rural areas, as authorized by 7 U.S.C. l 950aaa et seq., [$37,755,000]330,000,000, to remain available until expendedſ: Provided, That $3,000,000 shall be made available for grants authorized by 379G of the Consolidated Farm and Rural Development Act: Provided further, That $4,500,000 shall be made available to those noncommercial educational television broadcast stations that serve rural areas and are qualified for Community Service Grants by the Corporation for Public Broadcasting under section 396(k) of the Communications Act of 1934, including associated translators and repeaters, regardless of the location of their main transmitter, studio-to-transmitter links, and equipment to allow local control over digital content and programming through the use of high-definition broadcast, multi-casting and datacasting technologies]. For the cost of broadband loans, as authorized by section 601 of the Rural Electrification Act, [$28,960,000]$22,320,000, to remain available until expended: Provided, That the cost of direct 2 Ioans shall be as defined in Section 502 of the Congressional Budget Act of 1974. In addition, of the unobligated balances available for the cost of the broadband loans, $15,000,000 are hereby permanently cancelled: Provided. That no amounts may be cancelled from amounts that were designated by the Congress as an emergency requirement pursuant to the Concurrent Resolution on the Budget or the Balanced Budget and Emergency Deficit Control Act of 1985, as amended, In addition, $17,976,000, to remain available until expended, for a grant program to finance broadband transmission in rural areas eligible for Distance Learning and Telemedicine Program benefits authorized by 7 U.S.C. 950aaa. The first change eliminates $3,000,000 in funding for health care services grants, and $4,500,000 in funding to convert analog to digital operation to allow local control over digital content and programming through the use of high definition broadcast, multi-casting and data-casting technologies. Funding is not needed for these purposes in FY 2011. The second change rescinds non-emergency unobligated balances in the broadband account. This program will be utilizing funds from ARRA in FY 2010, and substantial carryover will be available in FY 2011 to Support demand. 595 29–38 RURALUTILITIES SERVICE Analysis of Change in Appropriation DISTANCE LEARNING, TELEMEDICINE, AND BROADBAND PROGRAMACCOUNT (On basis of loan level, subsidy, and grants) Loan Level Subsidy Grants Appropriations Act, 2010................................... $400,000,000 $28,960,000 $55,731,000 Budget Estimate, 2011...................................... 400,000,000 22,320,000 47,976,000 Decrease in Appropriations................................ 0. -6,640,000 -7,755,000 § PROJECT STATEMENT (On basis of supportable loan levels and appropriated subsidies and grants) (Inthousands of dollars) - 2009 Actual 2010 Estimated Increase or Decrease 2011 Estimated Item of Change Program Levell Subsidy/BA |Program Level Subsidy/BA | Program Level | Subsidy/BA. |Program Level Subsidy/BA Distance learning and telemedicine: Direct loans $16,266 $400 $0 $0 $0 $0 $0 $0 Grants 36,288 36,288 30,255 30,255 –255 -255 (1) 30,000 30,000 Health care services grants 0. 0 3,000 3,000 -3,000 -3,000 (2) 0 0. Public broadcasting systems grants 5,086 5,086 4,500 4,500 -4,500 –4,500 (3) 0 {} Broadband telecommunication: : Direct, Treasury rate loans 6,042 236 400,000 28,960 {) –6,640 (4) 400,000 22,320 Direct, Treasury rate loans - ARRAbſ 0 0 0. 0 {} {} 0 0 Grants 13,385 13,385 17,976 17,976 {} 0 17,976 17,976 Grants - ARRAbſ................................. 0 0 0 0 () Q 0 0 Total Available or Estimate 77,067 55,395 455,731 84,694 -7,755 -14,395 447,976 70,296 Total adminstrative expenses - ARRAb/ . {) 75,000 0 0 0 0. 0. Ó Recovery of prior year obligations -12,164 -11,423 0 0. {} {} {} {} Unobligated balance available, start of year -189,545 -10,448 0 0 0 0. {} 0 Unobligated balance available, end of year 14,790,804; 2,449,075 0 0 0. 0. {} 0 ARRAAppropriation by -14,375,897 -2,500,000) {} 0. () {} () 0. Rescission aſ 158,483 6,181 {} 0 {} 0 0 () Total Appropriation, Discretionary 448,648 63,780 455,731 84,691 -7,755 -14,395 447,976 70,296 NOTE: Individual columns may not add due to rounding Staff-years are reflected in the Salaries and Expenses Project Statement aſ The amounts are rescinded pursuant to PL 111-8 by Provided by the American Recovery and Reinvestment Act of 2009, PL 111-5, signed February 17, 2009, for the purpose of making supplemental appropriations for job preservation and creation, infrastructure investment, energy efficiency and science, assistance to the unemployed, and State and local fiscal stabilization The funds are available through the fiscal year ending September 30, 2010 ; 3. PROJECT STATEMENT (On basis of obligations under available funds) (In thousands of dollars) 2009 Actual 2010 Estimated Increase or Decrease 2011 Estimated ſtem of Change Program Levell Subsidy/BA |Program Level Subsidy/BA. Program Level | Subsidy/BA |Program level Subsidy/BA Distance learning and telemedicine: Direct loans.............................................. $16,266 $400 $5,670 $158 -$5,670 -$158 $0 $0 Grants 36,288 36,288 32,379 32,379 . -2,379 -2,379 30,000 30,000 Healthcare services grants 0. 0 3,000; . 3,000 -3,000 -3,000 0 0 Public broadcasting systems grants...................... 5,086 5,086 4,500 4,500 –4,500 -4,500 0 O Broadband telecommunication: Direct, Treasury rate loans............................. 6,042 236 408,389 29,567 -8,389 -7,247 400,000 22,320 Direct, Treasury rate loans - ARRAbſ............... () 0 6,698,895 485,000 -6,698,895 -485,000 {} () Grants................................................... 13,385 13,385 24,162 24,162 -6,186 -6,186 17,976 17,976 Grants-ARRAb/...................................... 0 0 1,940,000 1,940,000 -1,940,000 -1,940,000 {} 0 Total Available or Estimate 77,067 55,395 9,116,995| 2,518,766 -8,669,019 -2,448,470 447,976 70,296 Total adminstrative expenses - ARRAbſ............. 0 75,000 0. 0 0. 0 0 0 Recovery of prior year obligations....................... -12,164 -11,423 0 0 0 {} 0 () Unobligated balance available, start of year............... -189,545 -10,448 -8,868,446 -2,449,075|| 8,599,629 2,434,075 -268,817 -15,000 Unobligated balance available, end of year............ 14,790,804. 2,449,075 207,182 15,000 -207,182 -15,000 0 () ARRA Appropriation b/................................. -14,375,897 -2,500,000 {} 0 0 {} 0 () Rescission aſ 158,483 6,181 0 0. {} 0. () 0 Rescission cſ O 0 () 0}_268,817 15,000 268,817 15,000 Total Appropriation, Discretionary 448,648 63,780 455,731 84,691 -7,755 -14,395 447,976 70,296 NOTE: Individual columns may not add due to rounding. Staff-years are reflected in the Salaries and Expenses Project Statement. aſ The amounts are rescinded pursuant to P.L. 111-8. by Provided by the American Recovery and Reinvestment Act of 2009, P.L. 111-5, signed February 17, 2009, for the purpose of making supplemental appropriations for job preservation and creation, infrastructure investment, energy efficiency and science, assistance to the unemployed, and State and local fiscal stabilization. The funds are available through the fiscal year ending September 30, 2010. g/ The proposed rescission is of carryover balances into FY 2010 of regular funds not anticipated being obligated due to the large carryover of ARRA funding which will be obligated first in FY 2010 as it expires on September 30, 2010. f 598 (1) (2) (3) (4) 29-41 JUSTIFICATION OF DECREASES A decrease of $255,000 for distance learning and telemedicine grants ($30,255,000 available in 2010). For the distance learning and telemedicine grants, the decreased request is sufficient to meet program needs. A decrease of $3,000,000 for health care services grants ($3,000,000 available in 2010). The budget does not include funds to continue this program in FY 2011. A decrease of $4,500,000 for public broadcast system grants ($4,500,000 available in 2010). The requested decrease eliminates funding provided for digital TV conversion in rural areas. Digital TV conversion was completed in June, 2009, and no funding is needed for this purpose in FY 2011. A decrease of $6,640,000 in loan subsidy for direct broadband telecommunication treasury rate ($28,960,000 available in 2010). The requested subsidy amount is necessary to support the estimated loan obligations associated with the requested FY 2011 loan level for the broadband direct Treasury rate loan program. The change is due to the subsidy rate decline from 7.24 percent to 5.58 percent due to the projected interest rates for the FY 2011 President’s Budget economic assumptions and changes Recovery Act assumptions. 599 29–42 RURALUTILITIES SERVICE GEOGRAPHIC BREAKDOWN OF OBLIGATIONS 2009 Actual and Estimated 2010 and 2011 Distance Learning and Telemedicine Loans. 2009 2010 Alaska $776,834 º Arkansas 536,229 ** Kansas 551,651 tº tº Kentucky 736,694 tº tº Maine 408,884 sº Mississippi 9,992,000 tºº Oregon 480,122 gº tº Pennsylvania 1,666,523 sºº Vermont 316,842 rºº Wisconsin 800,000 gº Total Awaii./Est. $16,265,779 $5,669,930 1/ Cannot be distributed by geographic area in advance. 600 29-43 RURAL. UTILIHÉS SERVICE GEOGRAPHRC BREAKDOWN OF OBLIGATIONS 2009 Actual and Estimated 2010 gnd 2011 Distance Learning and Telemedicine Grants 2009 2010 2011 Alabama $433,867 º -> Alaska 1,308,970. sº -* Arizona 885,081 sº -sº Arkansas 2,394,628 * -º- Colorado 217,656 agº *= Georgis 1,002,298 * - Hawaii 453,431 se * Idaho 984,892 ** ** Indiana 299,458 * * Howa 737,151 * --- Kansas t,061,295 - - Kentucky 822,621 – a-º. Maine 3,869,307 * - Michigan 1,025,612 * •º Minnesota 1,398,461 ~ - Mississippi $89,661 * º Missouri 1,027,554 - * Montana. 842,709 wº ** Nebraska 695,722 gºs a- New Jersey 175,584 º º- New Mexico 1,013,970. eº- * New York 1,350,052 s - Ohio 433,282 *str * Oklahoma 2,749,779 asº - , Oregon 777,844 * - Pennsylvania 386,798 4-r -- South Dakota 1,161,873 tº- * Tennessee 2,114,418 ** * Texas 1,443,395 º * Vcfrnont $68,320 * - Virginia 267,633 * * Washington 993,057 *- -> West Virginia 1,186,107 º * Wisconsin 1,054,903 * - Wyoming 963,565 *. º Total Avsii.JEst. $36,287,654 $32,379,002 Il Tsºooooooo. Public Broadcasting Systems Grants 2009 2010 2011 Arkansas $749,447 º ºs Colorado 345,480 * * Idaho 481,770 * sº Indiana 596,000. - * Louisiana 745,000 * ** Michigan 750,000 - * Minnesota 496,899 * * Nevada 265,800 º e- Vermont 352,094 * * Wyoming 304,000 * - Total Avaii./Est, $5,086,460 $4,500,000 iſ - li Consilidated Farm and Rural Development Act, Section 379 2009 2013 2011 Totai Avsil./Esi. “º $3,000,000. It --> H Cannot be distributed by geographic area in advance. 601 29-44 RURAL. UTILITIES SERVICE GEOGRAPHICBREAKDOWN OF OBLIGATIONS 2009 Actual and Estimated 2010 and 2011 Direct Broadband Telecommunications Loans - Treasury Rate 2009 20:0 2011 Iowa $2,750,000 -- -- Kansas 2,384,000 *A*- ** Michigan 908,000 -- sº i / Totai Avail./Est. $6,042,000 $408,389,199 I/ $400,000,000 iſ Broadband Telecommunications Grants 2009 2010 2011 California $1,038,886 - -- * Colorado 402,666 sº- * - Kentucky 997,015 ºw- * * Louisiana 924,308 *º- º Missouri 471,905 -- -- New Mexico 1,101,900 **- ** Oklahoma 2,931,033 - **** Oregon 550,950 - sa- Texas 3,295,246 -- ** Virginia 837,453 ** º Washington 834,164 -- *º- Total Avail./Est, $13,385,526 $24,161,951 1/ $17,976,000 l/ Direct Broadband Telecommunications Loans - Treasury Rate Recovery Act 2009 2010 2011 Total Awaii./Est. * - $6,698,895,028.11 - - Broadband Telecommunications Grants Recovery Act 2009 2010 2011 Total Avail./Est. -- $1,940,000,000 iſ tº sº. 1/ Cannot be distributed by geographic area in advance. 602 29-45 RURAL. UTILITIES SERVICE DISTANCE LEARNING, TELEMEDICINE AND BROADBAND PROGRAM ACCOUNT Classification by Obiects 2009 Actual and Estimated 2010 and 2011 FY 2009 FY 2010 FY 2011 Other Objects: 25 Other purchases of goods and services - from government accounts................. $75,000,000 $0. $0 41 Grants, subsidies, and contributions........ 55,395,416 2,533,765,956 70,296,000 Total direct obligations............................. 130,395,416 2,533,765,956 70,296,000 603 29-46 RURAL. UTILITIES SERVICE HIGHENERGY COST GRANTS PROJECT STATEMENT (On basis of appropriation transfer) (In thousands of dollars) 2009 2010 Increase Or 2011 Item of Change Actual Estimated Decrease Estimated High energy cost grants aſ.......................... $19,374 $17,500 -$17,500 $0 Total Available or Estimate........................ 19,374 17,500 -$17,500 0 Transfer from Rural Water and Waste Disposal Program....................... . -17,500 -17,500 17,500 0 Unobligated balance available, start of year..... -19,507 0 0 0 Unobligated balance available, end of year...... 17,633 O 0 0 Total Appropriation................................. 0 O 0 O Staffyears are reflected in the Salaries and Expenses Project Statement. aſ In FY 2009 and FY 2010, $17,500,000 was provided for this program in the Rural Water and Waste Disposal Program account and transferred to this account. In FY 2011 no funds are proposed for this program. PROJECT STATEMENT (On basis of available funds) (In thousands of dollars) 2009 2010 Increase or 2011 Item of Change Actual Estimated i Decrease Estimated High energy cost grants aſ.......................... $19,374 $35,133 -$35,133 $0 Totai Available or Estimate........................ 19,374 35,133 -35,133 O Transfer from Rural Water and Waste Disposal Program........................ -17,500 -17,500 17,500 O Unobligated balance available, start of year...... -19,507 -17,633 17,633 O Unobligated balance available, end of year...... 17,633 O O O Total Appropriation................................. 0. 0. 0 O Staff years are reflected in the Salaries and Expenses Project Statement, a/ In FY 2009 and FY 2010, $17,500,000 was provided for this program in the Rural Water and Waste Disposal Program account and transferred to this account. In FY 2011 no funds are proposed for this program. IUSTIFICATIONOEDECREASE A decrease of $17,500,000 for high energy cost antS 17,500,000 available in 2010). The high energy costs grant program traditionally carries over the previous year's appropriation into the next fiscal year. We anticipate the FY 2010 funding will be carried over and available in FY 2011 for obligation. Carryover finding is sufficient to meet program requirements. 604 29-47 RURAL. UTILITIES SERVICE GEOGRAPHIC BREAKDOWN OF OBLIGATIONS 2009 Actual and Estirnated 2010 and 2011 High Energy Cost Grants 2009 2010 Alaska $13,858,735 tº Q & California 672,011 Yºº Florida 761,400 tº. a Maine 1,581,392 Wº ºr New Mexico s 550,722 * tº New York 1,250,000 *** * W. Pacific Areas 700,000 wº Total Avail./Est. $19,374,260 $35,133,271 1/ 1/ Cannot be distributed by geographic area in advance. 605 29–48 RURAL. UTILITIES SERVICE HIGHENERGY COST GRANTS Classification by Obiects 2009 Actual and Estimated 2010 and 2011 FY 2009 FY 2010 FY 2011 Other Objects: 41 Grants, subsidies, and contributions............. $19,374,260 $35,133,271 $0 Total direct obligations............... . . . . . . . . . . . . . . . . . . . 19,374,260 35,133,271 0 606 29-49 RURAL. UTILITES SERVICE Y RYA IN (in thousands) Program/Project/Activity 2009 2010 Broadband Loan and Grants $0 $8,638,895 Water and Waste Loan $991,645 $1,167,103 Water and Waste Grants $589,903 $515,719 Total Available for Program $1,581,548 $10,321,717 Salaries and Expenses $64,638 $51,762 Total Available $1,646,186 $10,373,479 Projec — R Ac f © (in thousands) 2009 Agtual 2010 Estimated Staff Staff Increase or • Amount Years. Amount Years Decrease Rurai Water & Waste Disposal Direct Loan $991,644 229 $1,167,102 {) -$1,167,102 Program Rural Water & Waste Disposal Grants $585,802 135 $500,539 O -$500,539 Program Technical Assistance Grants for Rural $0 () $5,000 0 -$5,000 Waste Systems t Rural Circuit Rider Contract Grants $4,100 {} $10,179 0. -$10,179 Distance Learning, Telemedicine & Broadband Loan $0 () - sé,698,895 () -$6,698,895 Program Distance Learning, Telemedicine & - Broadband Grants $0 0 $1,940,000 0. -$1,940,000 P Salaries and Expenses $64,638 $51,762 Total Available $1,646,638 364 $10,373,479 0 -$10,373,479 l io g B and Loan t P 607 29-50 °rogram Implementation Activities: Broadband Loan and Grant Program Goals • Fund projects that will support economic developmentſjob creation beyond the immediate construction/operations of the broadband facilities (initial priority to areas where business demand for service can already be demonstrated over areas where demand can be created). • Ensure that broadband service is provided to rural areas lacking access, targeting un-served. Objectives: Loans and grants will be used to fund the design and construction of broadband systems and facilities in rural areas. Delivery Schedule: • Weekly meetings being held and coordinated by White House. – Working closely with Commerce, FCC, and the White House to coordinate efforts to rollout programs. - - - • First round of funding was announced through a Notice of Funds Availability published in July 2009. Application window closed August 24, 2009. More than 2,200 applications were received. Initial awards were announced on December 17, 2009. Additional awards were announced on January 25, 2010. Agency ARRA T • A second round of funding will be announced in January 2010. • All obligations must be made by September 30, 2010. Achievement of Program Goals: • Performance goals are under development This is a new program, and goals will be developed based on experience with the applications received under the first round of funding. Water and Waste Disposal Program Goals • 2.6 million customers receiving new or improved service. - • Reduce by 7%, rural people's exposure to water related health and safety hazards. • 64,600 jobs created or saved (based on multiplier). 608 29–51 Objectives: Loans and grants to rural water and waste systems will be used to construct, improve or rehabilitate rural water and waste disposal systems. Grant funding will also be used to provide grants to nonprofit organizations for technical assistance for rural water and waste systems. Delivery Schedule: Project • April 2009 – ARRA fund obligations for shovel ready projects. • April 2009–Notice of Funds Availability (NOFA) published by Rural Development for all Rural Development programs implementing ARRA. s May 2009 – Allocation of funds to State Offices and National Circuit Rider Contract. • May – September 2009 – State allocations are monitored and teleconferences and assistance visits provided to ensure proper utilization of funds. - • June 2009–Complete obligation of $1.3 Billion of ARRA funding. • May 2009 to August 2010–complete marketing of ARRA funding throughoutreach. • June 2009 to September 2010 - The Agency will manage funding to ensure the September 30, 2010 deadline for obligation is met. Funding will periodically be redistributed. - Through September 30, 2009, ARRA had investments of$1.58 billion in loans and grants; as of January 22, 2010, $1.97 billion in loans and grants. Loans FY 2009 701 FY 2010 1/22/2010 241 Total - f 609 29–52 December 2009— Complete cumulative obligation of $2 Billion of ARRA funding for Water and Waste Disposal Program, – The cumulative obligation was $1.5 billion. September 30, 2010— Complete cumulative obligation of $3.3 Billion of ARRA funding for Water and Waste Disposal Program. - Achievement of Program Goals: Measures: Performance Data 2009 Actual 2010 T 2011 Loan and Grant TBD N/A Waste of program borrower's subscribers 769,559 1,830,000 A IłęW Or service - Reduced percentage of rural resident’s exposure to 2.70% 2% N/A borne Number of created or saved 736 - N/A 610 29g-l RURALUTILITIES SERVICE STATUS OF PROGRAMS Rural Electrification and Telecommunications Loans Programs Current Activities: The Rural Utilities Service provides electric and telecommunications financing throt direct loans and loan guarantee programs. The rural electric direct and loan guarantee programs provide financing for the operation of electric generation, transmission, and distribution facilities. The - telecommunications loan program provides direct loans for construction, expansion, and operation of telecommunications facilities. - Specific areas being addressed currently include: 1. Financing projects to improve electric service in rural areas. Providing reliable, affordable electrici is essential to the economic well-being and quality of life for all of the Nation's rural residents. The Electric Programs provides leadership and capital to upgrade, expand, maintain, and replace Americ vast rural electric infrastructure. - 2. Financing projects to improve telecommunication service in rural areas. The program priorities are ensure that rural communities have access to advanced telecommunications services such as high- speed Internet services and advanced communications services such as distance learning and telemedicine. Program outreach efforts are focused on identifying rural areas that do not have acce to these services, which are essential for economic development and improved health and education ServiceS. - Selected Examples of Recent Progress: Recent accomplishments under this appropriation item are cited below by program: Electric Programs: The electric programs make direct loans and loan guarantees to finance the construction of electric generation, transmission and distribution facilities, including system improvements and replacements required for electric service in rural areas, and for demand side management, energy efficiency and conservation programs, and on-grid/off-grid renewable energy systems. Loans are made to corporations States, territories, subdivisions and agencies such as municipalities, utility districts, cooperatives, tribal utilities, nonprofits, limited-dividends, or mutual associations that provide retail electric service needs to rural areas or power supply needs of distribution borrowers in rural areas. The electric programs service nearly 700 active electric borrowers in 46 States, plus the active territories of the Marshall Islands, Puert Rico, and American Samoa. - - In FY 2009, the electric programs approved 209 direct loans and loan guarantees totaling almost $6.6 billion--173 distribution loans amounting to over $3.7 billion and 24 generation and transmission loans totaling almost $2.8 billion. Some of the loans and loan guarantees that were approved follow: $99.477 million for 12 loans in the direct hardship electric loan program. $132.2 million for advanced metering equipment installations $3,287 million for other distribution system improvements. $186.8 million for renewable energy projects $726 million for environmental improvements to existing generation plants. $951 million in transmission system improvements. 611 29g-2 The almost $6.6 billion in financing supported projects in 2,517 counties or 80 percent of all counties in the Inited States, including 477 counties classified as persistent poverty counties and 1,006 counties classified outmigration counties. Financing contributed to the creation of over 151,000 jobs in rural areas. Over .8 million retail customers benefitted from new or improved electric services financed through RUS in FY 09. unding more renewable energy projects is a goal for USDA. USDA gives priority to completed loan lications that are requesting funds for renewable energy projects. elecommunications Program: e telecommunications program makes direct loans for construction, expansion, and operation of lecommunications lines and facilities or systems. Rural Development continues to fund the deployment. fadvanced telecommunications facilities in rural America. The program makes new or improved services ailable to borrowers’ subscribers, including rural residents and businesses. Performance measures irectly measure the impact of the programs on rural communities. FY 2009, the telecommunications program approved $690 million in infrastructure program loans. This ding will allow rural telecommunications providers to deploy new or improved service to more than 5,416 rural subscribers. For the last two years, 90% of the loans financed have been for fiber-to-the- me projects to provide fiber-optic service to rural homes and businesses. istance Learning, Telemedicine and Broadband Program: t Activities: The distance learning, telemedicine and broadband program provides loans and grants r the deployment of equipment utilized in providing distance learning and telemedicine services to rural hools, educational institutions and health care providers, in addition to financing advanced :lecommunications networks capable of delivering broadband service to rural residents and businesses. pecific areas being addressed currently include: 1. Financing projects to provide rural access to adequate medical and educational services. The program focuses on Medically Underserved Areas identified by the Department of Health and Human Services, and on encouraging growth in the number of rural schools which offer distance learning classes to rural residents. 2. Financing projects to provide rural access to high-speed internet services. Priority is given to providing financing for rural communities that do not have access to broadband services. These services are essential for the economic and social development of rural communities. : Recent accomplishments under this appropriation item are cited 1 FY 2009, the distance learning and telemedicine program approved $52.6 million in distance learning ld telemedicine loans and grants which will benefit 754 rural counties. For example, in Alaska, the opper River School District received a grant to fund a videoconferencing system connecting 6 :hools and a child advocacy center, encompassing 23,000 square miles of extremely rural and isolated rritory. In addition to shared classes, content creation and professional development, counseling ld outreach services will be extended to these communities to assist children who are in abusive |- 612 29g-3 Broadband Program: The 2008 Farm Bill required changes to the Rural Access Broadband Loan and Loan Guarantee Program which was authorized under the 2002 Farm Bill. New regulations are currently under development. The efficient implementation of the Recovery Act program has taken priority. All applications received in FY 2009 were held pending publication of the new regulations. Three loan applications received in FY 2008 and covered under the previous broadband regulations were approved in FY 2009, totaling $6,042,000. Broadband access is crucial to rural communities. The ongoing Broadband Access Loan Program provid funding for infrastructure in communities of 20,000 population or less. For example, Air Advantage serv the thumb area of Michigan, a predominantly agricultural area surrounded by the manufacturing hubs for the auto industry. Air Advantage has received three Broadband loans since 2003 to provide wireless broadband services in several rural communities. American Recovery and Reinvestment Act of 2009 Broadband Initiatives Program The American Recovery and Reinvestment Act of 2009 (ARRA) authorized $2.5 billion in budget authori for RUS to provide loan, grant and loan/grant combination funding for broadband infrastructure in rural communities. The program was created and a Notice of Funds Availability (NOFA) was published on Ju 9, 2009 announcing the first round of funding under the program. The NOFA was a joint NOFA with the National Telecommunications Information Administration (NTIA) of the Department of Commerce, whi also received funding for broadband infrastructure. More than 2,200 applications were received in the fir round of funding. On December 17, 2009, RUS awarded the first ARRA broadband grants and loans to eight recipients. These awards totaled $53.8 million in RUS funding. No funds were obligated in FY 2009. RUS anticipates making additional funding awards in the second quarter of FY 2010. The second and final round of funding will be announced in January or February 2010. All ARRA funds must be obligated by September 30, 2010. Water and Environmental Programs The water and environmental programs has a leading role in providing rural communities with modern, affordable water and waste disposal services. The water program directs technical and financial program resources to rural communities with the greatest need. These communities may be poverty-stricken as a result of out-migration, natural disasters or economic stress. However, rural communities can sustain economic development and improve the quality of life for their residents with dependable water and wast services and infrastructure. - Specific areas being addressed currently include: • Building leveraging partnerships to expand resources going to rural areas, • Directing resources to the neediest projects and communities, • Working with local communities and other borrowers to ensure funds are invested wisely, . • Focusing on maintaining sustainable water systems in rural communities, • Improving the loan to grant mix so that more loan dollars are used by systems that can afford maximum debt capacity, and • Limiting grant funds to the most financially needy systems. Selected Examples of Recent Progress: Recent accomplishments under this appropriation item are cited below by program: - In FY 2009, Rural Development invested $921 million in direct and guaranteed loans and grants to help rural communities develop 798 water and waste disposal facilities. These facilities provided new or 613 29g-4 mproved water and waste disposal services to 3,388,089 borrowers' customers. Funding activities cluded: - • $790 million in wwd direct loans and grants made to develop 516 facilities • $53.3 million assisted 153 projects in disadvantaged communities • $38 million funded 46 projects in communities qualifying for emergency assistance • $40.7 million funded 46 grants to technical assistance providers • 106,559 technical assistance calls were completed by Drinking Water and Wastewater Circuit Riders • $1.9 million in guaranteed loans • 34 projects administered for partner organizations © $993,000 for Individually-owned Water Well Systems Grants • $496,000 for Water and Wastewater Revolving Fund Grants • $4.5 million for 97 Predevelopment Planning Grants to assist in preparing applications for WEP funds • $28 million in 2008 Disaster loan and grant funding to provide 27 water and waste projects e water program continues to use and refine assessment tools implemented as part of the FY 2003 rformance assessment conducted by OMB. The Rural Development National and State offices regularly onitor the national and individual state performance goals to evaluate program delivery and services to tomers. In FY 2009, the water program met or exceeded goals for three of its four annual measures xcluding ARRA funding): 1. Loan to grant mix—70 percent loans and 30, percent grants 2. Referrals to commercial credit—42.26 percent of the dollar amount of loans closed, and 3. Number of borrowers’ customers receiving new or improved water or waste disposal service— 3,388,089. he results demonstrate that Rural Development is able to target funds to more communities and projects here the financial investments result in a greater number of borrowers’ customers being served. :veraged funds for project development fell just short of meeting the national goal of 30 percent. The al Development National and State offices continue to coordinate their strategies to strengthen ationships with partner agencies and organizations. erican Recovery and Reinvestment Act of 2009 Water and Environmental Programs addition to the responsibilities for FY 2009 appropriated funds, the water program was given significant onsibilities related to the American Recovery and Reinvestment Act of 2009 (ARRA). The water ogram was tasked with delivering more than $3.2 billion in loans and grants over 18 months to improve ter and waste infrastructure in rural America. By the end of FY 2009, the water program had invested. .57 billion (60 percent) of ARRA funding in rural water and waste projects. The funding translated into rogram level representing 63 percent loans and 37 percent grants. The extraordinary effort will ensure t communities across rural America will have access to clean drinking water, as well as sewer and solid aste systems. 614 29-53 RURALUTILITIESSERVICE Summary of Budget and Performance Statement of Department Goals and Objectives Rural Utilities Programs Mission; USDA Rural Utilities Service (RUS) enhances the quality of life and improves economic opportunity in rural communities by providing the basic infrastructure of modern life. Electricity, telecommunications, water and waste systems are essential services for individuals and businesses alike that assist communities with creating wealth, supporting self-sustaining and repopulating communities, and thriving economically. Telecommunications Program: The telecommunications infrastructure program continues to provide the primary telecommunications infrastructure necessary for rural communities. Current funding levels are adequate to meet anticipated demand for system upgrades and expansion, and each funding opportunity mandates that the system be capable of providing broadband communication capacity. Broadband access through our Broadband programs is also critically important to rural America. Broadband gives rural communities access to global markets, enhances educational and health care services, and encourages economic diversification. Electric Programs: Since the creation of the rural electrification program in 1935, it has been one of the most successful Federal economic development initiatives. Rural electricity demand is projected to grow in the years ahead, driven by the rising electricity usage and the continuing economic diversification of rural America. The burgeoning renewable energy industry in rural America has created a demand for financing within the Electric Programs to support expansion and modernization of electric transmission and distribution infrastructure. Water Programs: Adequate water and wastewater treatment capacity are significant for supporting quality of life issues, environmental sustainability, and economic development. Safe drinking water and sanitary waste disposal systems are vital not only to public health but also to the economic vitality of rural America. Tighter environmental standards and the importance of accommodating business growth in a rapidly diversifying rural economy contribute to program demand. - RUS has one strategic goal and two strategic objectives that contribute to one of the Secretary's Strategic Goals and one High Priority Performance Goals (HPPGs). USDA Agency Agency Objectives Programs that Contribute Key Outcom Strategic Strategic - Goal Goal USDA Agency Objective 1: Telecommunications Programs : Key Outcome Priority Goal Goal: Enhance the ability of Direct Telecommunications Loans 1: 1: USDA will Improve rural businesses to Treasury Telecommunications Loans | Provide acces: assist rural the succeed by providing FFB Telecommunications Loans to modern communities quality of access to modern Distance Learning and Telemedicine | telecommunic to Create life in telecommunications Grants tions prosperity so | Rural - Broadband Loans and Grants they are self America ARRA Broadband Loans and Grants sustaining, repopulating and 615 29–54 economically Objective 2: Electric Programs Key Outcome thriving. Develop community Direct (Hardship) Electric Loans 2: infrastructure Municipal Rate Electric Loans. Modernize and Treasury Rate Electric Loans improve FFB Electric Guaranteed Loans. community Loans for Bonds and Notes infrastructure Guaranteed Electric Loans Water and Environmental Programs Direct Water and Waste Disposal Loans - - Guaranteed Water and Waste Disposal Loans - Water and Waste Disposal Grants Solid Waste Management Grants Emergency & Imminent Community Water Assistance Grants Çey Outcome 1: Provide access to modern telecommunications HPPG Measure: Increase the prosperity of rural communities by concentrating and strategically investing In eight to ten regions, resulting in the creation of strong local and regional economies, with a particular *mphasis on food systems, renewable energy, broadband-based economies and rural recreation. in order to meet the goal of increasing economic opportunity in rural America, RUS annually finances new :onstruction and upgrades to telecommunications infrastructure. Access to high-speed Internet services ind other quality telecommunications services increases educational opportunities, improved availability of . job creation, retention and growth of businesses and other economic growth and is crucial to the evelopment of any regional economy. The Telecommunications Program has developed specific annual hort-term performance measures which demonstrate progress towards the creation of strong rural roadband-based economies. The program tracks the number of borrowers’ subscribers that have received lew or improved service and determines the number of jobs created or saved by broadband-related interprises. The program improves processes and meets challenges by maintaining detailed records of m lending activity and applying the information collected towards expansion of services. long-term Performance Measures: • Target: 2012 --90% of rural households will have access to broadband - • Target: 2012 – 5.70% of borrowers’ subscribers will receive new or improved telec ications service - elected Past Accomplishments toward Achievement of the Key Outcome: - ince 2001, RUS has provided more than $5.6 billion in financing for improving telecommunications in al America. All telecommunications facilities financed by RUS must be high-speed broadband capable. e development of the Internet-based economy provides unique opportunities for rural America. roadband infrastructure greatly helps to mitigate the limitations on business development in rural areas aused by geographical distance and a limited customer base. RUS has provided capital to finance access broadband service for rural communities. This access is critical to enable rural businesses to participate the developing giobal economy. Selected Accomplishments Expected at the FY 2011 Proposed Resource Level: • 350,000 borrowers’ subscribers will receive new or improved telecommunication services. • More than $1 billion will be provided in financing of high-speed broadband capacity subscriber lines. 616 29-55 Efficiency Measures: • Total salaries and expenses ($) / (Average loan portfolio balance outstanding ($) + Total average grants ($)) - • Total number of FTE used / (Average loan portfolio balance outstanding ($) + Total average grants ($)) • Total subsidy budget authority / (Average loan portfolio balance outstanding ($) Key Outcome 2: Develop community infrastructure HPPG Measure: Increase the prosperity of rural communities by concentrating and strategically investing in eight to ten regions, resulting in the creation of strong local and regional economies, with a particular emphasis on food systems, renewable energy, broadband-based economies, and rural recreation. The Electric Programs make loans and loan guarantees to provide and improve electric service in rural areas by financing electric distribution and transmission from renewable energy sources and energy efficiency and conservation measures. The program's goal of improving the quality of life of rural residents is accomplished by promoting and providing access to capital and credit for the development an delivery of modern, affordable and reliable electric utility services. The program tracks the number of borrowers’ consumers that receive new or improved electric services and estimates the number of jobs created or saved by electric and renewable energy related investments. Long-term Performance Measures: • Target: 2012 -- Continued increase in the number of electric programs’ borrowers’ consumers receiving new or upgraded electric service. Selected Past Accomplishments toward Achievement of the Key Outcome: Since 2005, the electric loan programs have offered over $34 billion in financing for rural electric system In 2009 the program approved 209 loans totaling $6.598 billion. The annual program level funding for electric loans has averaged $5.26 billion over the last five years. The funds were used by rural utilities to construct electric distribution, transmission and generation facilities to provide electric service in rural areas, supporting economic development and modernizing community infrastructure. The investment of the electric loan funds creates and maintains jobs in rural communities. Interest in financing renewable energy and energy efficiency programs through the electric programs is growing. In 2009 the program approved over $186.8 million in loan guarantees for new renewable electric generation projects. The electric programs have adopted a progressive management approach by enhancing use of automated systems to support loan and grant management and innovating new products and procedures to support renewable energy initiatives. The program continues its commitment to, maintaining a workplace that values employees, and provides high-quality service to its customers. Selected Accomplishments Expected at the FY 2011 Proposed Resource Level: • 3,825,000 rural electric customers receiving new or upgraded service. The Water Programs have been addressing several areas to target resources to rural areas: • Building leveraging partnerships to expand resources going to rural areas. Working groups have included regional planning commissions, regional councils of developments, and other State agencies to explore funding opportunities for projects in rural communities and areas, • Directing resources to the neediest projects and communities, • Working with local communities and other borrowers to ensure funds are invested wisely, • Focusing on maintaining sustainable water systems in rural communities, 617 29-56 • Improving the loan to grant mix so that more loan dollars are used by systems that can afford maximum debt capacity, and - - • Limiting grant funds to the most financially needy systems. .ong-term Performance Measures (Utilities Programs): • Target: 2011—25 percent of the rural population we have not reached in the past will have been served by water facility projects that correct or eliminate water-related health and safety hazards such as waterborne illnesses, carcinogens, and potential security risks. The goal over a 5-year period from 2010 to 2014 is to average 5 percent annually. • Target: 2011–90 percent of all water programs borrowers will maintain sustainable water and wastewater systems in their rural communities. fficiency Measures: • Total salaries and expenses ($) / (Average loan portfolio balance outstanding ($) + Total average grants ($)) • Total number of FTE used / (Average loan portfolio balance outstanding ($) + Total average grants ($)) - - • Total subsidy budget authority / (Average loan portfolio balance outstanding ($) + Total average grants ($)) • Loan/Grant Ratio: An efficiency measure used to improve the loan-to-grant mix so that more loan dollars are used by systems that can afford maximum debt capacity and grant funds will be used by needy systems. lected Past Accomplishments toward Achievement of the Key Outcome: FY 2009, the programs had a budget at the program level of $1.6 billion. Special priority emphasis has en placed on funding projects through the American Recovery and Reinvestment Act (ARRA) with an ditional $1.3 billion of investments being provided by the Act for water and waste disposal facilities. e ARRA program alone has served over 4,157,648 borrowers’ customers, exceeding the annual target of 6 million customers served. - verall obligations for the water and waste loan and grant program for FY 2008 were 74 percent loan and 5 percent grant. The 2009 obligations are expected to meet the goal of 70 percent loan and 30 percent rant (the annual efficiency measure goal for FY 2009). s a result of RD’s investment in water and waste facilities, communities are able to save or create jobs; verage funds with the private sector, local agencies, and State agencies; attract Federal funds from other gencies; and enlarge the economic and property tax base. Through September 2009, USDA had leveraged 968 million from other sources with over $3.1 billion of water program loan and grant funds. early FY 2007, a task force analyzed and developed the criteria to be used in determining the stainability of the facilities. The task force determined that the debt service ratio (DSR) and current ratio CR) would be used to indicate the feasibility and the sustainability of facilities. The sustainability criteria e based on industry standards of a DSC ratio of 1.10% or more and a CR of 1.50% or more. lected Accomplishments Expected at the FY 2011 Proposed Resource Level: • Provide new or improved water and/or waste disposal service to 1,394,000 borrowers’ customers with $1.6 billion of program funds. - • Produce a loan to grant ratio of 70/30 so that more dollars are used by systems that can afford maximum debt capacity. - • Limit grant funds to the most financially needy systems. z - • Increase leveraged funds to 30 percent of total project costs from non-agency sources for USDA funded projects. - 618 29-57 Strategic Goal Funding Matrix (On basis of Appropriation) Strategic Goal 2009 Actual 2010 Estimated 2011 Estimated Amount Staff Aruount Staff Increase or . Amount Staf {in thousands) Years (in thousands) Years Decrease (in thousands) Year Telecommunications $767,068 173 (a) 1,168,100 170 -$30,124 $1,137,976 181 Electric Programs $6,598,477 182 $7,100,000 185 -$3,000,000 $4,100,000 197 Water and Environmental (a) $921,076. 192 (a) $2,635,322 550 –$1,078,524 $1,556,798 590 Total, Goal 1 $8,286,621 547 $10,903,422 905 -$4,108,648 $6,794,774 968 (a) Does not include ARRA funds 619 Goal: 29–58 RURAL. UTILITIES SERVICE Summary of Budget and Performance Key Performance Outcomes and Measures Key Outcome: Improve the quality of life in Rural America by Developing Community Infrastructure Key Performance Measures: - Measure #1: Number of telecommunication programs’ borrowers’ subscribers receiving new or improved service. Measure #2: Number of electric programs’ borrowers’ consumers receiving new or upgraded electric service. Measure #3: Number of water programs’ borrowers' subscribers (or customers) receiving new and/or improved water and/or improved waste disposal service. Key Performance Targets: Performance Measure #1 2006 2007 2008 2009 2016 2011 Telecommunica tions (including Broadband) a. Number of borrowers’ subscribers receiving new or improved telecommunicati on services b. Program Dollars - (in thousands) Actual Actual Actual Actual Target Target 297,027 356,440 775,342 i 187,399 350,000 350,000 $1,027,879 $642,988 || $1,129,125 $714,514 || $1,130,051 $1,107,976 ARRA Broadband Loans and Grants a. Performance Measure to be determined b. Program Dollars (in thousands) 0 TBD NA $0 | $8,638,895 NA i - One broadband loan for $267 million accounted for 447,113 subscribers which was an anomaly in FY 2008 620 29.59 2006 Actual 2007 Actual 2008 Actual 2009 Actual 2016 2011 Target Distance Learning & Telemedicine a. Number of counties served by entities receiving distance learning and telemedicine funding b. Program Dollars (in thousands) 653 $65,419 392 $59,400 586 $43,242 400 $52,554 Target 380 s38,049 380 $30,000 Performance Measure #2 Hardship, Municipal Rate and Treasury Rate Loans a. Number of borrowers’ ÇO （SłłłłłęIS receiving new or improved electric service b. Program Dollars (in thousands) 2,420,212 $1,189,764 2,016,239 $1,189,764 196,896 $99,300 73,778 $98,477 125,000 $100,000 125,000 $100,000 FFB Electric Loans a. Number of borrowers’ C{}}}SUTHCIS receiving new or improved electric facilities b. Program Dollars in thousands) 5,763,437 $2,700,000 3,810,212 $2,700,000 7,905,741 $6,500,000 | 9,685,639 $6,500,000 6,000,000 $6,500,000 3,700,000 $4,000,000 621 29-60 Performance Measure #3 Actual 2006 2007 Actual 2008 Actual 2009 Actual 2010 Target 2011 Target Water and Environmental Programs a. Number of program borrowers' subscribers receiving new improved service from Agency’s funded water facilities. b. Program Dollars (in thousands) 1,637,554 $1,484,144 1,332,063 $1,579,948 4,361,872 $1,822,949 3,388,089 $886,874 1,457,000 $2,537,188 1,394,000 $1,556,798 ARRA. Water and Environmental Programs a. Number of program borrowers’ subscribers receiving new or improved service b. Program Dollars (in thousands) 769,559 $1,581,548 1,830,000 $1,682,822 HPPG Measures: Performance Measureſ Program 2006 Actual 2007 Actual 2008 Actual 2009 Actual 2010 Target 2011 Target Performance Measure #1 - a. Number of program borrowers’ subscribers receiving new or improved telecommunications service b. Dollars 297,027 $1,027,879 356,440 sé42.988 775,342 $1,129,125 $714,514 187,399 350,000 $1,130,051 350,000 $1,107,976 622 29-61 Performance Measure #2 a. Number of program borrowers’ consumers receiving new or improved electric service b. Dollars 8,183,649 $3,889,764 5,826,451 $3,889,764 8,102,637 $6,599,300 9,759,417 $6,598,477 6,125,000 $6,600,000 3,825,000 $4,100,00ſ Performance Measure #3 a. Number of program borrowers' subscribers receiving new improved service from Agency’s funded water facilities. b. Dollars 1,637,554 $1,484,144 1,332,063 $1,579,948 4,361,872 $1,822,949 3,388,089 $886,874 1,457,000 $2,537,188 1,394,000 $1,556,798 623 29-62 EXHIBIT 2-6 UTILITIES PROGRAMS Full Cost by Secretary's Strategic Priorities Priority: Assist rural communities to create wealth so they are self sustaining, repopulating and thriving. - PROGRAM PROGRAM ITEMS 2009 AMOUNT 2010 AMoUNT 2011 AMOUNT Telecommunications Loans, Treasury Telecommunications Loans, and FFB Telecommunications Loans Level 000 0 Costs Costs IłłeaSure: 6. per Measure (unit 0.06 Distance Distance and Telemedicine Grants Level . 54 Costs Costs THC3Słłłę. served Measure (unit on Farm & RD Sec 379C Health Care Services Grant Level Costs Costs HleaSlife: T 0 Measure (unit cost {} {) Broadband Telecommunication Loans and and Public Level $24.5 t 4 $417,976 18,708 Costs - 156 Costs 49 76 ItaC3Słłſe: of borrowers' subscribers service Measure (unit 624 29–63 PROGRAM (TEMS 2009 AMOUNT 2010 AMOUNT | 2011 AMOUNT • rê3S Łevel Costs Administrative Costs Total measure: Newſ Subscribers Measure (unit cost Birect Treasury Municipal Loans and Electric Loans for Bonds and Notes Levei 477 H - {} Costs III&#Süß. ribers served - T . - 759,417 Measure (unit cost 0.00 {} {}{} 0.01 water & Waste Bisposal Loans, Guaranteed Water & Waste Disposal Loans, Water & Disposal Grants, Individually-Owned Water Well System Grants, Grants for Water and Wastewater Revolving Funds, Solid , and & Water Asst. Grants, Level 37, 189 $f 4 : 1.792 15 14,767 Total 192 measure: # of new and/or water and/or waste service T Measure (unit cost Cost Grants i.evel Costs Costs Total Newf Subscribers Measure 625 29–64 PROGRAM PROGRAM ITEMS 2009 AMOUNT 2010 AMOUNT 2011 AMOUNT ($000) ($000) ($000) Direct Water and Waste Disposal Loan 2008 Disasters Emer. Supp., Water and Waste Disp. Grants May 6, 2007 Emer. Supp., Water and Waste Disp. Grants 2008 Disasters Emergency Supplemental, Water and Waste Disp. Grants 2003/2004 Hurricanes Emer. Supp., Water adm Waste Disp. Grants 2005 Hurricanes E.Mer. Suppl., Emer, and imminent Comm. Waster Asst. Grants - Emer. Supp., Emer and Imminent Comm. Water Asst. Grants - 2005 Hurricanes Program Level $34,203 $83,479 $0 Budget Authority 19,068 26,354 () Administrative Costs (Direct) {} 0 () Administrative Costs (Indirect) {} 0 () Total Costs 19,068 26,354 {} FTES 0 {) 0. Performance measure: New/ Upgraded Subscribers Target: - N/A N/A N/A Cost per Measure (unit cost) N/A N/A N/A Direct Water and Waste Disposal Loans - Stimulus, Water and Waset Disposal Grants - Stimulus, Circuit Rider- Tech. Assist. Grants for Rural Water Systems - Stimulus Program Level $1,581,548 $1,682,822 $0 Budget Authority $734,881 603,719 () Administrative Costs (Direct) 28,127 () () Administrative Costs (Indirect) 13,236 0 0 Total Costs 776,244 603,719 0 FTEs 364 0. 0 Performance measure: New/ Upgraded Subscribers Target: 769,559 1,830,000 N/A Cost per Measure (unit cost) N/A N/A N/A FFB Electric Loan 2005 Hurricane Modifications Emergency Supplemental and FFB Electric Loans 2008 Disasters Modifications Emergency Supplemental Program Level $0 $0 $0 Budget Authority. 0. 7,985 {} Administrative Costs (Direct) () () 0 Administrative Costs (Indirect) 0. O {} Total Costs {} 7,985 0 - FTEs () () O Performance measure: New/ Upgraded Subscribers - Target: N/A N/A N/A Cost per Measure (unit cost) N/A N/A |N/A Total for Secretary's Priorities Program Level $9,887,543 $21,245,618 $6,794,770 Budget Authority 1,241,036 4,006,978 604,710 Administrative Costs (Direct) 70,316 72,956 78,739 Administrative Costs (Indirect) 33,090 34,332 37,054 Total Costs 1,344,442 4,114,266 720,503 FTEs 91 i 905 968 Performance measure: Target: * N/A N/A N/A Cost per Measure (unit cost) N/A N/A N/A * S&E and FTE figures for each program are estimates. Actual staff time by program is not available at this time. ** FY 09 targets are based on appropriation. Totals may not balace due to rounding. FOOD AND NUTRITHO}M SERVICE 2011 Explanatory Notes Table of Contents PAGE Purpose Statement 30-1 Statement of Available Funds and Staff Years 30-7 Permanent Positions by Grade and Staff Years 36-8 Passenger Motor Vehicle Data 30-9 Child Nutrition Programs: Appropriations Language 30-10 Lead-Off Tabular Statement 30-1 || Project Statement 30-12 Justifications 30-15 Proposed Legislation 30–25 Geographic Breakdown of Obligations and Staff Years 30-27 Classification by Object 30-28 Recovery Act 30–39 Status of Program 30g-1 Special Supplemental Nutrition Program for Women, Infants and Children (WIC): Appropriations Language - 30–33 Lead-Off Tabular Statement 30-34 Project Statement 30-35 Justifications 30-37 Geographic Breakdown of Obligations and Staff Years 30-39 Classification by Object 30–40 Recovery Act 30–41 Status of Program 30g-26 Supplemental Nutrition Assistance Program: Appropriations Language 30–44 Lead-Off Tabular Statement 30–45 Project Statement 30-46 Justifications 30-48 Proposed Legislation 30-56 Geographic Breakdown of Obligations and Staff Years ...30-60 Classification by Object 30-61 Recovery Act .30-62 ********".................................................................................................................30g-33 Commodity Assistance Program: Appropriations Language 30-65 Lead-Off Tabular Statement 30–66 Project Statement 30-67 Justifications 30-69 Geographic Breakdown of Obligations and Staff Years. 30-73 . Classification by Object 30-74 Recovery Act 30-75 Status of Program 30g-56 (627) 628 Nutrition Programs Administration: Appropriations Language 30-78 Lead-Oſf Tabular Statement 30-79 Project Statement .30-80 Justifications * * * * .30-80 Geographic Breakdown of Obligations and Staff Years 30–87 Classification by Object ...30-88 Status of Program wn & tº is º w w w w w ſº º Pº 6 º' ºr * * * * * * * * * * * * * * * * * * * * * * > * 30g-73 Summary of Budget and Performance: Statement of Goals and Objectives ... 36-89 Key Performance Outcomes and Measures.............................................................................. 30–92 Full Cost by Strategic Objective...... ...30-97 629 30- | FOOD AND NUTRITION SERVICE PURPOSE STATEMENT The Food and Nutrition Service (FNS) was established August 8, 1969, by Secretary's Memorandum No. 1659 and Supplement I pursuant to the authority contained in 5 U.S.C. 301 and the Reorganization Plan No. 2 of 1953, FNS is the Federal agency responsible for managing the domestic nutrition assistance programs. Its mission is to increase food security and reduce hunger in partnership with cooperating organizations by providing children and low-income people access to food, a healthful diet, and nutrition education in a manner that supports American agriculture and inspires public confidence. Over the past half-century – beginning with the National School Lunch Program in 1946 – the Nation has gradually built an array of nutrition assistance programs designed to help the most vulnerable populations meet their food needs. Taken together, the current programs form a nationwide safety net supporting low- income families and individuals in their efforts to escape food insecurity and hunger and achieve healthy, nutritious diets. Currently, the programs administered by FNS touch the lives of one in five Americans over the course of a year. - Descriptions of Programs: The nutrition assistance programs described below works both individually and in concert with one another to improve the Nation's nutrition and health by improving the diets of children and low-income households. • Supplemental Nutrition Assistance Program (SNAP): Authorized by the Food and Nutrition Act of 2008, SNAP serves as the primary source of nutrition assistance for over 33 million low-income people. It enables participants, about 49 percent of whom are children, to improve their diets by increasing food purchasing power using benefits that are redeemed at authorized retail grocery stores across the country. State agencies are responsible for the administration of the program according to national eligibility and benefit standards set by Federal law and regulations. Benefits are 100 percent Federally-financed, while administrative costs are shared between the Federal and State Governments. SNAP provides the basic nutrition assistance benefit for low-income people in the United States; other FNS programs supplement this program with benefits targeted to special populations, dietary needs and delivery settings. (Puerto Rico, the Commonwealth of the Northern Mariana Islands, and American Samoa receive grant funds with which to provide food and nutrition assistance in lieu of SNAP.) • Food Distribution Program on Indian Reservations (FDPIR): FDPIR distributes USDA-purchased foods as an alternative to SNAP for Indian households on or near reservations. State agencies and Indian Tribal Organizations (ITOs) that operate the program are responsible for certifying recipient eligibility, nutrition education, local warehousing and transportation of food, distribution of food to . recipient households, and program integrity. The Federal Government pays 100 percent of the cost of commodities distributed through the program, and cash payments for administrative expenses. • Child Nutrition Programs (CNP): The Child Nutrition Programs - National School Lunch (NSLP), School Breakfast (SBP), Special Milk (SMP), Child and Adult Care Food (CACFP), and Summer Food Service (SFSP) - provide reimbursement to State and local governments for nutritious meals and snacks served to over 31 million children in schools, child care institutions, and after school care programs. The program also supports meal service in adult day care centers. FNS provides cash and USDA purchased food on a per-meal basis to offset the cost of food service at the local level and a significant portion of State and local administrative expense, and provides training, technical assistance, and nutrition education. Payments are substantially higher for meals served free or at a reduced price to children from low-income families. 630 30-2 • Special Supplemental Nutrition Program for Women, Infants and Children (WIC): WIC addresses the supplemental nutritional needs of at-risk, low-income pregnant, breastfeeding and postpartum women, infants and children up to five years of age. It provides participants monthly supplemental food packages targeted to their dietary needs, nutrition education, and referrals to a range of health and social services – benefits that promote a healthy pregnancy for mothers and a healthy start for their children. Appropriated funds are provided to States for food packages and nutrition services and administration for the program; States operate the program pursuant to plans approved by FNS. WIC is augmented in some localities by the Farmers’ Market Nutrition Program, funded within the Commodity Assistance Program account, and authorized by the WIC Farmers’ Market Nutrition Act of 1992, which provides fresh produce to WIC participants. - - • The Emergency Food Assistance Program (TEFAP): This program supports the emergency food organization network by distributing USDA-purchased food for use by emergency feeding organizations including soup kitchens, food recovery organizations, and food banks. TEFAP also provides administrative funds to defray costs associated with processing, repackaging, storage, and distribution of Federal and privately donated food. The allocation of both Federal food and administrative grants to States is based on a formula that considers the States’ unemployment levels and the number of persons with income below the poverty level. . . . • The Commodity Supplemental Food Program (CSFP): This program provides foods purchased by USDA to low-income infants and children up to age six, low-income pregnant and postpartum women, and to low-income senior citizens. In recent years, there has been a shift towards low-income elderly in this program; in FY 2009, elderly participation comprised approximately 95 percent of total participation. Foods are distributed through State agencies to supplement food acquired by recipients from other sources. The CSFP is operated as a Federal/State partnership under agreements between FNS and State health care, agricultural or education agencies. In FY 2009, 32 States, the District of Columbia, and two Indian reservations operate CSFP. Beginning in 2010, seven new States were added to the program. - • Senior Farmers' Market Nutrition Program (SFMNP): This program provides coupons to low-income seniors that can be exchanged for fresh, nutritious, unprepared, locally grown fruits, vegetables and herbs at farmers’ markets, roadside stands, and community-supported agriculture programs. • Pacific Island and Disaster Assistance: Pacific Island Assistance includes assistance to the nuclear- affected zones of the Republic of the Marshall Islands in the form of USDA purchased food, or cash-in- lieu of food, and administrative funds and is authorized under the Compact of Free Association Amendments Act of 2003, (P.L. 108-188). Disaster relief funds are provided for use in non- Presidentially declared disasters. - Federal nutrition assistance programs operate as partnerships between FNS and the State and local organizations that interact directly with program participants. States voluntarily enter into agreements with the Federal Government to operate programs according to Federal standards in exchange for program funds that cover all benefit costs, and a significant portion of administrative expenses. Under these agreements, FNS is responsible for implementing statutory requirements that set national program standards for eligibility and benefits, providing Federal funding to State and local partners, and monitoring and evaluating to make sure that program structures and policies are properly implemented and effective in meeting program missions. State and local organizations are responsible for delivering benefits efficiently, effectively, and in a manner consistent with national requirements. - 631 FNS Staff: - 30–3 The public servants of FNS are an important resource for advancing the key outcomes sought through the nutrition assistance programs. The agency staff serves to ensure and leverage the effective use of the other program appropriations. FNS staff is funded primarily out of the Nutrition Programs Administration account, which represents approximately one-third of one percent of the total FNS budget. The agency employment level represents less than two percent of the total employment within USDA and is similarly small in proportion to the total State-level staff needed to operate the programs. The agency employs people from a variety of disciplines, including policy and management analysts, nutritionists, computer and communication experts, accountants, investigators, and program evaluators. Because of the small size of the agency's staff relative to the resources it manages, FNS has created clear and specific performance measures and must focus its management efforts in a limited number of high-priority areas. - Program operations are managed through FNS' seven regional offices and 67 field offices/satellite locations. A regional administrator directs each regional office. These offices maintain direct contact with State agencies that administer the FNS programs. The agency's regional offices also conduct on-site management reviews of State operations and monitor the 193,753 stores authorized to redeem SNAP benefits. As of September 30, 2009, there were 1,270 full-time permanent employees in the agency. There were 487 employees in the Washington headquarters office; and 783 in the field, which includes seven regional offices; 67 field offices; four SNAP compliance offices in Illinois, California, New Jersey, and Tennessee; and a computer support center in Minneapolis, Minnesota. The chart below displays staff year utilization. STAFF YEAR DISTRIBUTION (From All Sources of Funds) 2009 2010 2011 Project - - Actual Estimated | Change Requested Supplemental Nutrition Assistance Program } 04 } 16 . . 0 . . ] I 6 Child Nutrition Programs I 58 | 70 6 176 Commodity Assistance Program 2 2 0. 2 Supplemental Nutrition Program for Women, Infants and Children - 0 22 0 22 Nutrition Programs Administration 977 1,045 40 1,085 Center for Nutrition Policy and Promotion 28 32 10 42 Total Available - 1,269 1,387 56 1,443 Audit Reports of National Significance Issued for Fiscal Year 2009 OIG Audits Issued - - { - Status SNAP 27601-15-AT 9-08 Food Stamp Program Retailer Pending administrative action by FNS. - Agency-wide 27.401-33-HY 1 1-08 Authorization and Store Visits Food and Nutrition Service Financial Statements for Fiscal Years 2008 and 2007 Report contained an unqualified opinion with no recommendations. 632 30-4 GAO Audits 1ssued - - - Status NSLP GAO-09-156R 1-09 Meal Counting and Claiming by Report contained no Food Service Management recommendations for FNS Companies in the School Meal Programs NSLP GAO-09-584 7-09 School Meal Programs: Report contained no Experiences of the States and recommendations for FNS Districts That Eliminated Reduced-price Fees NSLP GAO-09-649 8-09 School Meal Programs: Changes FNS currently working on to Federal Agencies' Procedures Statement of Action to Could Reduce Risk of School address report findings. Children Consuming Recalled . Food - NSLP GAO-09-81.4 9-09 School Meal Programs: FNS forwarded Statement Improved Reviews, Federal of action responding to Guidance, and Data Collection report findings November Needed to Address Counting and 2009. Claiming Errors THE CENTER FOR NUTRITION POLICY AND PROMOTION As the lead Federal Department in human nutrition, the USDA is charged with developing national nutrition policy and designing and disseminating science-based nutrition promotion programs for all Americans, and populations receiving nutrition assistance. The Center for Nutrition Policy and Promotion (CNPP) is USDA’s focal point for improving the health of Americans by developing and promoting dietary guidance that links the best evidence-based scientific research to the nutrition needs of consumers. Overview of Program Development CNPP develops integrated nutrition research, education, and promotion programs and is a recognized authority for providing science-based dietary guidance for the American public (including consumers and professionals in health, education, industry, and the media). CNPP also helps devise better cost-effective strategies to target nutrition programs to different customers by analyzing consumer dietary needs, socio-economic characteristics, behaviors, and lifestyles. To meet its mission, CNPP performs the following functions: Advances and Promotes Food and Nutrition Guidance for All Americans CNPP oversees improvements in and revisions to Departmental nutrition guidance, while ensuring the consistency of all guidance with the Dietary Guidelines for Americans, the cornerstone of Federal nutrition policy. The MyPyramid Food Guidance System provides current Departmental nutrition guidance disseminated to nutrition educators, health professionals, and consumers in the form of millions of print documents; educator’s toolkits; and via Web-based interactive and personalized tools at MyPyramid.gov. MyPyramid.gov has received more than 9 billion hits since its launch in April 2005 and has millions of registered users of the tools for dietary and physical activity assessment. 633 30–5 Uses Evidence-Based Methods as the Scientific Foundation for Nutrition Policy, Promotion and Education - CNPP established and maintains USDA’s Evidence Analysis Library (EAL), including the Nutrition Evidence Library to monitor, assess, gather, analyze, and consult on the scientific evidence in support of nutrition, food, dietary guidance, nutrition education and nutrition research policies and outreach programs. The EAL designs and leads a wide range of scientific review projects that inform and support nutrition policy and guidance, and serve as the basis for nutrition promotion and education activities. The Nutrition Evidence Library, a major function of the EAL, supports the Dietary Guidelines 2010 process. The EAL was formed to provide a broader-based evidence library to support Federal and external organizations as a repository of the most up-to-date credible literature available in the areas relative to the Dietary Guidelines for Americans, obesity, food groups, weight management, physical activity, food safety, methods of consumer nutrition education program development, risk analysis and nutrients, and social marketing. The EAL serves as the USDA model upon which USDA agencies approach science review to support the policies for which they have responsibility. - Coordinates Nutrition Promotion and Education Policy within USDA CNPP leads the USDA team for the joint USDA/Department of Health and Human Services (DHHS) development, review, and clearance of the Dietary Guidelines policy document and coordinates an interagency working group on developing a plan for the promotion and communication of the 2010 Dietary Guidelines. CNPP is the focal point for advancing and coordinating nutrition promotion and education policy within USDA. CNPP chairs the USDA Dietary Guidance Working Group. This working group reviews all of USDA’s and DHHS’ nutrition publications and materials to ensure consistency with the Dietary Guidelines. CNPP also represents USDA on the DHHS Healthy People 2010 initiative in the areas of food, nutrition, and obesity. Promotes Consumer-Oriented Nutrition Messages CNPP continues to develop and update science-based dietary guidance for healthy Americans two years of age and older. In addition, CNPP and the Department continue to work to promote good health through wise food choices and adequate physical activity to help prevent disease. CNPP uses the most recent food consumption survey data available to target its nutrition messages for the public. Translating nutrition guidance for consumers in a way that educates and motivates change in dietary behavior will ultimately lead to improved health status. In addition to its efforts to disseminate the print materials related to the Dietary Guidelines for Americans, CNPP is working diligently to reach a larger number of Americans with relevant and motivating nutrition promotion messages delivered through a wider array of communication channels. Collaborates with Public/Private Groups to Promote Nutrition CNPP will continue to lead USDA’s efforts to communicate nutrition messages through a wide variety of mechanisms, including the MyPyramid Food Guidance System, nutrition assistance programs, commodity and agricultural groups, food industry, trade associations, and public health organizations and the media. CNPP will continue to collaborate with public, private, and nonprofit groups to expand access to USDA's nutrition assistance programs. Collaboration with the public and private sectors is used to encourage widespread participation in nutrition education efforts based on the Dietary Guidelines for Americans. CNPP has established over a hundred public-private partnerships to magnify the reach of MyPyramid tools and messages. Uses Policy-Focused Analyses to Advance Nutrition and Consumer Economic Knowledge CNPP's science-based research supports national policy, Departmental policy, and the promotion of healthful eating in America. CNPP staff members conduct policy analyses of socio-economic, food behavior, and food disappearance data. Some large-scale analyses are performed cooperatively with other Federai agencies and outside experts. This work supports policymaking for domestic nutrition assistance, 634 3{}-6 setting a national agenda for nutrition security, and representing domestic nutrition policy to the international community, and contributes to activities related to nutrition monitoring of foods and nutrients available for consumption, CNPP develops USDA’s Food Plans including the Thrifty Food Plan, on which SNAP benefits are based. The Food Plans represent a market basket of nutritious foods that could be purchased at various lower income levels. CNPP also produces the Expenditures on Children by Families (“The Cost of Raising a Child”) report, which became an interactive Web-based tool in 2009, which provides families with the costs of household expenditures, including food. Further, CNPP measures diet quality as a gauge of the nutritional well-being of our population, which is used in health and nutrition policymaking. The Healthy Eating Index (HEI) is the measure of overall diet quality that the Department uses to determine the degree to which the population’s eating habits are consistent with the Dietary Guidelines for Americans. - Eating patterns and their behavioral determinants are analyzed to gauge the effect of policy on consumers' food behavior and to help devise more efficient means of helping people improve their diet. Scientific research is made available to policymakers and published for the research community and the public. CNPP is reaching the public more effectively than ever before through a combination of print materials, news releases, interactive tools, its Web site, and presentations at professional conferences. 635 30-7 FOOD AND NUTRITION SERVICE Available Funds and staff Years 2009 Actual and Estimated 2010 and 2011 & Actual : . . Estimated : : Estimated itern : 2009 : : 2010 : : 201 Amount : SY : Amount : SY : Amount : SY Supplemental Nutrition Assistance Program... : $51,481,784,736 : 104 : $60,468,145,000 : 116 - $63,266,290,000 : 116 SNAP ARRA....................................... : 4,723,055,571 : : 10,931,388,000 : 2 1 1,935,785,000 : . Child Nutrition Program: tº * * - * - Appropriation................................... : 8,889,966,728 : 128 : 10,046,535,000 : 155 : 13,003,868,000 : 16] Permanent Appropriation..................... : 59,453,295 : 30 : 263,020,000 : $5 - 121,500,000 : 15 Transfer from Section 32,..................... : 6,455,802,000 : : 6,989,899,000 : 2 5,277,574,000 : CN ARRA.….... : 100,000,000 : : 0 : . : 0 Total - Child Nutrition Program.............. : 15,505,222,023 : 158 : 17,299,454,000 : 170 : 18,402,942,000 : 176 Special Supplemental - . 3. *g : : : Mutrition Program.............................. : 6,955,706,314 : º 7,746,144,000 : 22 : 8,057,646,000 : 22 - : • 0 WIC ARRA......................................... : 72,362,334 : 65,813,000 : : : 2 ze 2 & * 2 Commodity Assistance Program................. : 263,195,446 : 272,127,000 : - . * 270,219,000 : TEFAP ARRA .................................... : 125,000,000 : : 25,000,000 : . : - O : Nutrition Programs Administration.............. : 142,595,000 : 1,005 : 147,801,000 : 1,077 : 169,087,000 : 1,127 Congressional Hunger Center.................... : 2,347,000 3,000,000 : : 3,000,000 : Total, Food and Nutrition : Service Funds.................................... : 79,271,268,424 .. * 1,269 : 96,958,872,000 : 1,387 : 102,104,969,000 : 1,443. Obligations under other USDA Appropriations: Forest sº : 104,000 : : Office of Operations............................... : 51,320 : - Foreign Agricultural Service.................. ... . 3 i8,390 : Office of the Inspector General... ............... : - j6,805 . National arrespºn…: 39,688 : Farm Service Agency.............................. : 170,620 : . Run Developmen.… : *so {}OOOOO0 : {}O0OO Total, Agriculture Appropriations............ : 735,383 : : . O : O Other Federal Funds: - : - : : : Commerce.......................................... : 65,000 : : {} : : 0. : Federal Executive Board.......................... 93.4%; : o: * o: Total, Other Federal Funds....................... : 171,590 : : 0 : {} : Total, Food and Nutrition Service........... : 79,272,175,397 : _20? . 96,958,872,000 . 1,387 . 102,104,969,000 : 1,443 Note: For additional explanation of specific program figures, please see the supporting project statements. Note: Amounts include ARRA funds. 636 30-8 FOOD AND NUTRATION SERVICE Permanent Positions by Grade and Staff Year Summary 2009 Actual and Estimated 2010 and 20% 2009 2010 20% Grade Wash DC Field Total Wash DC Field Total Wash DC Fjeld Total Senior Executive - Service 8 7 15 8 7 #5 8 . 7 15 GS-15......................... 3} 9 40 3} 9 40 31 9 40 GS-34......................... 63 54 } 1 7 63 54 ] }7 63 54 . } } 7 GS-13,........................ 190 #31 321. 190 13} 321 196 } 40 336 GS-12......................... + | 19 222 34? | 19 229 348 }26 239 365 GS-11......................... 49 296 345 50 - 305 355 57 3 } 5 372 GS-9........................... 29 25 54 29 32 6 : 30 36 66 GS-8........................... 5 6 } } 5 6 } } 5 6 } ] GS-7........................... 20 29 49 20 36 56 20 38 58 GS-6........................... } } 8 }9 } | 8 | 9 ] 8 19 GS-5........................... I } 3 24 } ] 13 24 1 ! 3 24 GS-4........................... 5 } } | 6 5 | ] i 6 5 } } } 6 Other Graded Positions..... } 3 4. } 3 4 } 3 4 Total Permanent Positions...................... 542 834 1,356 543 844 1,387 564 879 1,443 Unfilled Positions End-of Year.................. 55 3 | 86 Totai, Permanent Full-Time Employment End-of Year................., 487 783 1,270 543 844 1,387 564 879 1,443 Staff Year Estimate 487 782 j,269 543 844 },387 564 879 1,443 637 36-9 FOOD AND NUTRITION SERVICE SIZE, COMPOSITION AND COST OF MOTOR VEHICLE FLEET The FNS fleet consists largely of sedans. Retailer Investigations Branch officials employ the majority of these vehicles in field audits as part of the Food Stamp Program. Additionally, and to a much lesser extent, vehicles are assigned to FNS regional offices and used for business travel among their field offices and remote worksites. Lastly, FNS uses two 15-passenger vans at Headquarters in Alexandria, Virginia for all-day shuttle service to the USDA agencies in downtown Washington, D.C. - Size, composition and cost of agency motor vehicle fleet as of September 30, 2009 are as follows: Size, Composition, and Annual Cost thousands of Fisca; Sedans and Light Trucks, Mediurn Buses Heavy Number Operating Year Station SUVs and Duty Duty of Cost - Vans - V V in 4X2 203 || NOTES: - - * These numbers include vehicles that are leased fron GSA and one vehicle feased from a commercial source. ** There are no significant changes. All significant year-to-year changes would be discussed in a narrative provided separately, 638 30- ) {} FOOD AND NUTRITION SERVICE The estimates include appropriation language for this item as follows (new language underscored; deleted matter enclosed in brackets): - - Child Nutrition Programs (including transfers of funds): 1. [In lieu of the amounts made available in section 14222(b) of the Food, Conservation, and Energy Act of 2008, for For necessary expenses to carry out the Richard B. Russell National School Lunch Act (42 U.S.C. 1751 et seq.), except section 21, and the Child Nutrition Act of 1966 (42 U.S.C. 1771 et seq.), except sections 17 and 21; [$16,855,829,000) $18,158,393,000, to remain available through September 2. 30, [2011, of which $1,000,000 may be used to carry out the school community garden pilot program established under section 18(g)(3) of the Richard B. Russell National School Lunch Act (42 U.S.C. 3. 1769(g)(3)), and of which $9,865,930,000 is hereby appropriated, $6,747,877,000 shall be derived by transfer from funds available under section 32 of the Act of August 24, 1935 (7 U.S.C. 612c) and $242,022,000 shall be derived by transfer from unobligated and unavailable balances from fiscal year 4. 2009 under section 32 of the Act of August 24, 1935 (7 U.S.C. 612c)}2012, of which such sums as are made available under section 14222(b)(i) of the Food, Conservation, and Energy Act of 2008 (Public Law 110-246), as amended by this Act, shall be merged with and available for the same time period and purposes as provided herein: Provided, That of the total amount available, $5,000,000 shall be available to be awarded as competitive grants to implement section 4405 of the Food, Conservation, and Energy Act of 2008 (Public Law 1 10–246), and may be awarded notwithstanding the limitations imposed 5. by sections 4405(b)(1)(A) and 4405(c)(1)(A): Provided further, That section 14222(b)(1) of the Food, Conservation, and Energy Act of 2008 is amended by adding at the end before the period, “except section 21, and the Child Nutrition Act of 1966 (42 U.S.C. 1771 et seq.), except sections 17 and 21”. The first change eliminates unnecessary language that superseded a legislative provision. The second change eliminates language related to a pilot project funded in FY 2010. The third change eliminates unnecessary language related to transfers from Section 32 funds. The fourth change provides new language on the statutory provision that authorizes the transfer of Section 32 funds. Previously, this provision was superseded in the language, which resulted in Section 32 funds that could not be obligated by AMS or transferred to FNS. The fifth change makes a technical amendment to the statutory provision that authorizes the transfer of Section 32 funds to provide that the transferred funds can be used for all programs funded within the Child Nutrition Programs account. 639 CHILD NUTRITION PROGRAMS – CURRENT LAW 30-1 || FOOD AND NUTRITION SERVICE LEAD-OFF TABULAR STATEMENT AND SUMMARY OF INCREASES AND DECREASES ppropriations Act, 2010 $16,855,829,000 udget Estimate, 201 | 18,158,393,000 ncrease in Appropriation +1,302,564,000 CHILD NUTRITION PROGRAMS - PROPOSED LEGISLATION Budget Estimate, Current Law, 2011 $18,158,393,000 Change due to proposed legislation..., + 1,000,000,000 Net Request, President's 2011 Budget Request. 19,158,393,000 Summary of Increases and Decreases–Current Law (On basis of appropriation) 2010 Pay Program 20I i item of Change Estimated Costs Changes Estimated i. Meal Reimbursement Payments to States . (a) School Lunch $9,967,068,000 0. $622,930,000 || $10,589,998,000 (b) School Breakfast 2,920,391,000 {} 197,472,000 3, 1 }7,863,000 (c) CACFP 2,640,923,000 0 87,831,000 2,728,754,000 (d) Summer Food Service Program 387,264,000 0 9,962,000 397,226,000 (e) Special Milk 12,673,000 () –2,076,000 10,597,000 Subtotal, Meal Reimbursements 15,928,319,000 {} 916, 19,000 6,844,438,000 2. State Administrative Expenses 193,258,000 {} 15,395,000 208,653,000 3. Commodity Reimbuſ t/PI 685,876,000 {} 353,864,000 1,039,737,000 4. Discretionary Activities 48,376,000 $189,000 h?,000,000 65,565,000 Total Appropriation 16,855,829,000 189,000 1,302,375,000 18, 158,393,000 640 30-12 PROJECT STATEMENT – CURRENT LAW (On basis of appropriation) 2009 2010 bncrease of 20? I Project Actual SY Estimated SY Decrease Estimatcd SY_ 1. Meal Reimbursement Payments to States - (a) School Lunch $8,472,755,000 $9,967,068,000 $622,930,000 $10,589,998,000 (b) School Breakfast 2,633,048,000 2,920,391,000 197,472,000 3,117,863,000 (c) CACFP - 2,513,852,000 2,640,923,000 87,831,000 2,728,754,000 (d) Summer Food Service Program 357,984,000 387,264,000 9,962,000 397.226,000 (e) Special Milk Program 14,941,000 12,673,000 , -2,076,000 10,597,000 - Subtotal, Meal Reimbursements 13,992,580,000 15,928,319,000 916, #19,000 |_(1) 16,844,438,000 2. State Administrative Expenses 178,994,000 193,258,000 15,395,000 l (2) 208,653,000 - 3. Commodity Reimbursement/Procurement 741,209,000 685,876,600 353,861,000 (3) 1,039,737,000 Subtotal, Mandatory 14,912,783,000 16,807,453,000 | 1,285,375,000 18,092,828,000 '4. Discretionary Activities: ". (a) Team Nutrition 15,000,000 15,016,000 30,000 (4) i5,046,000 (b) Food Safety Education 2,500,000 2,510,000 7,000 (5) 2,517,000 (c) Coordinated Review 5,636,000 5,751,000 82,000 (6) 5,833,000 (d) Computer Support 9,492,000 9,525,000 28,000 (7) 9,553,000 (e) CACFP Training and Tech. Assist. 3,500,000 3,537,000 : 30,000 (8) 3,567,000 (f) Studies and Other Discr. Activities 3,000,000 3,699,000 16,012,000 (9) 19,711,000 (g) Hunger Free Community Grants 0 5,000,000 0 5,000,000 (h) Farm to School Tactical Team 0. {} 2,000,000 (10) 2,000,000 (i) School Garden Pilot {} 1,000,000 -1,000,000 (11) 0 (j) CN Payment Accuracy 0. 2,338,000 0. 2,338,000 Subtotal. Discretionary 39,128,000 48,376,000 17,189,000 65,565,000 5. ARRA, P.L. l l 1-5 - NSLP Equipment Grants 100,000,000 {} {} 0 Subtotal, ARRA 100,000,000 - {} {} {} Adjusted Appropriation 15,051,911,000 128 16,855,829,000 155 1,302,564,000 18,158,393,000 ió) ARRA Funds -100,000,000 {} () 0 Total appropriation 14,951,911,000 H28 16,855,829,000 : 155 1,302,564,000 18,158,393,000 16; Note: Staff year figures are associated with discretionary and mandatory activities. 641 30-13 PROJECT STATEMENT (On basis of available funds) 2009 2010 Increase or 20 ! I Project Actual SY Estimated SY Decrease Estimated SY 1. Meal Reimbursement Payments to States (a) School Lunch $8,983,711,452 $10,218,168,000 $494.879,000 $10,713,047,000 (b) School Breakfast 2,607,355,589 2,897,802,000 220,061,000 3,117,863,000 (c) CACFP 2,451,682,273 2,615,929,000 i 12,825,000 2,728,754,000. (d) Summer Food Service Program 356,332,519 376,521,000 20,705,000 397,226,000 (e) Special Milk Program. i4,285,671 11,888,000 - 1,291,000 10,597,000 Subtotal, Meal Reimbursements. 14443,367,504 16,120,308,000 847,179,000 16,967.487,000 2. State Administrative Expenses 174,133,982 193,258,000 15,395,000 208,653,000 3. Commodity Reimbursement/Procurement 716,878,975 674,492,000 365,245,000 1,039,737,000 Subtotal, Mandatory 15,304,380,461 16,988,058,000 1,227,819,000 18,215,877,000 4. Discretionary Activities: (a) Team Nutrition 14,745,733 15,0}6,000 30,000 15,046,000 (b) Food Safety Education 2,081,685 2,510,000 7,000 2,517,000 (c) Coordinated Review 6,334,705 5,751,000 82,000 5,833,000 (d) Computer Support 8,145,176 9,525,000 28,000 9,553,000 (e) CACFP Training and Tech. Assist. 1,918,200 3,537,000 30,000 3,567,000 (f) Studies and Other Discr. Activitities 1.987,000 3,699,000 16,012,000 19,711,000 (g) Hunger Free Community Grants 0. 5,000,000 0. 5,000,000 (h) Farm to School Tactical Team 0. 0 2,000,000 2,000,000 (g) School Garden Pilot 0. l,000,000 -1,000,000 0 (h) CN Payment Accuracy 0. 2,338,000 0 2,338,000 (i) FFVP2-Year Funds 6,175,768 0. 0 0 Subtotal, Discretionary 43,388,267 48,376,000 17,189,000 65,565,000 5. ARRA, P.L. 1 1 -5 NSLP Equipment Grants 100,000,000 - - {} 0 O Subtotal, ARRA 100,000,000 0 0 0 otai Obligations 15,445,768,128 128. 17,036,434,000 i55 1,245,008,000 18,281,442,000 16} Prior Year Recoveries/Collections -106,966,963 0 0 0. Unobligated Balance Start-of-Year -255,659,235 -303,654,000 180,605,000 - 23,049,000 ransfer from 12-3505 -500,000,000 G 0. 0. Unobligated Balance End-of-Year 303,654,269 - 123,049,000 -123,049,000 {} nobligated Balance Expiring $60,498,502 . (3 {} 0. ransfer to 12X3539 If 4,615,699 () () 0 Adjusted Appropriation 15,051.9; 1,000 128 16,855.829,000 || 155 1,302,564,000 18, 158,393,000 | 161 ARRA Funds -100,000,000 0 0 - {} Total Appropriation 14,951,9} t.000 128 1685,829,000 $55 1,302,564,000 18, 158,393,000 16] Note: Staff year figures are associated with discretionary and mandatory activities. 1/ Transfer is made under the authority provided by P.L. 109–97, which permits CACFP audit funds that remain unused after the first year of availability to be recovered and reallocated. The reallocated funds are available unt conducting CACFP institution audits. it expended for the purpose of 642 lſ Authority expires after FY 2010 per Sect. 26(d) of the Richard B. Russell National School Lunch Act. 30- 14 PROJECT STATEMENT (On basis of appropriation) 2009 - 2010 lncrease or 20 ! : Permanent Appropriation Activities: Actual sy Estimated SY Decrease Estimated SY. information clearinehouse II $250,000 $250,000 -$250,000 {}. Food Service Management lmstitute 4,000,000 4,000,000 0. $4,000,000 Grants to States (Fresh Fruit and Veg. x-year funds).2/ 108,000,000 25,000,000 201,000,000 226,000,000 Tech. Assistance Program lntegrity 31 2,000,000 2,000,000 -2,000,000 0 Grants to States {Administrative Review) 4,000,000 4,000,000 {} 4,000,000 School Food Purchase Survey 3,000,000 {} {} {} Summer Demonstration Projects {} 85,000,000 -85,000,000 {} School Lunch Equipment Grants 0 25,000,000 -25,000,000 {} CACFP Health and Nutrition Grants {} 8,000,000 -8;500,000 0 Direct Certification Technical Assistance {} 25,000,000 -25,000,000 0 : Total Permanent Appropriation 121,250,000 3{} 173,250,000 | }.5 33,750,000 234,000,000 == 21 Authority for direct appropriation terminated per Sect. 4304 of P.L. 1 10-234; program funded by transfers in FY 2009 and fater years. 31 Authority expires after FY 2010 per Sect. 21(g){1}{A} of the Richard B. Russeli National School Lunch Act. - PROJECT STATEMENT (On basis of available funds) 20{}9 - 2010 increase or 20; } Permanent Appropriation Activities: Actual SY Estimated SY Decrease Estimated information Clearinghouse $250,000 $250,000 -$250,000 {} Food Service Management Institute 4,000,000 4,000,000 {} $4,000,000 Direct Certification and verification 0 2,513,000 -2,533,000 {} Evaluation of Effectiveness (Direct Cert.) 2,400 492,000 -492,000 0. SFSP Evaluation +0,824 9,000 -9,000 0. SFSP Rural Transportation Grants {} 122,000 - 22,000 {} Evaluation CACFP () 8,000 -8,000 {} Grants to states (Fresh Fruit and veg. x-year funds) 42,993,166 92,581,000 20,919,000 i 13,500,000 : Tech. Assistance Program Integrity 2,000,000 2,694,000 -2,694,000 {} CACFP Audit Funds-x year 2,878,41 3,404,000 -3,404,000 0 Grants to States (Administrative Review) 4,495,76; 13.947,000 .9,947,000 4,000,000 School Food Purchase Survey 2,713,959 0 {} o Summer Demonstration Projects {} 85,000,000 -85,000,000 {) School Lunch Equipment Grants 0 25,000,000 –25,000,000 0 }. CACFP Health and Nutrition Grants {} 8,000,000 -8,000,000 0 | Direct Certification Technical Assistance 0 25,000,000 –25,000,000 o Best Practices 108,774 {} {} . {} Total Obligation 59.433.295 30 263,020,000 | 15 -141,520,000 121,500,000 15 Transfer from 128/93539 –4,615,699 {} 0 {} Unobligated Balance Start of Year *-15,891,103 -87,851,000 87,851,000 {} Coltections/Recoveries -5,547,527 {} {} - {} Expiring Funds {} 3,081,000 -3,08},000 0. Unobligated Balance End of Year 87,851,034 {} # 12,500,000 $12,500,000 Total Permanent Appropriation 121,250,000 30 i 78,250,000 15 55,750,000 233,000,000 == 643 30-15 Justification of Increases and Decreases The FY 2011 request for the Child Nutrition Programs reflects a net increase of $1,302,564,000. 1) An increase of $916,119,000 for meal reimbursements ($15,928,319,000 available in FY 2010), Explanation of Change. School Lunch Program: This program will require a net increase of $622,930,000 in budget authority for an appropriation level of $10,589,998,000 in FY 2011 ($9,967,068,000 is available for FY 2010). This level of funding is 6.3 percent over the FY 2010 funding level and will be required to provide reimbursement for meal service currently projected for FY 2011. Based on actual performance to date, the total number of school lunches and snacks in FY 2011 (5.6 billion) is projected to increase by about 90.2 million over the current estimate for FY 2010 of 5.6 billion, which is a 1.6 percent increase. Student participation in the NSLP is continuing at approximately 61.9 percent of enrollment in participating schools. The current estimate for free lunches in FY 2011 projects an increase of 3.6 percent above the level of free lunches estimated to be served in FY 2010. Free lunches are estimated at 59.0 percent of all lunches served in FY 2011. Changes in the reimbursement rates, reflecting increases in the Consumer Price Index (CPI) for Food Away from Home, also contributed to the need for increased funding. This request also reflects the cost of snacks served under the after school NSLP snack program created by P.L. 105-336. Other information: Income Eligibility Eligibility for rates of payment in the Child Nutrition Programs is tied to family income with free meal eligibility set at 130 percent of the Federal poverty level and reduced price meals at 185 percent. The pertinent income levels for a family of four are shown below (rates are higher for Alaska and Hawaii): 2008–2009 2009-2010 Poverty Level School Year School Year 100 Percent $21,200 $22,050 I 30 Percent 27,560 28,665 185 Percent 39,220 40,793 644 30-16 PROGRAM （NDICATORS SCHOOL LUNCH PROGRAM 2009 2010 20% PROGRAMi PERFORMANCE DATA ACTUAL ESTIMATE ESTIMATE CHANGE Lunches Served (miſſions): - Above 185% of poverty 1,949.3 1,706.3 | 1,661.5 AAF 130% - 185% of poverty 52}.8 # 542.6 556.2 13.6 Below 130% of poverty 2,709.9 3,080.8 3,191.9 TTTT TOTAL, Lunches 5,181.0 5,329.7 5,409.6 79.5 Average Daily Participation (millions): 3 i.2 32.] 32.6 0.5 Lunch Rate per meal (blended) (cents): Above 185% of poverty 24.2 25.2 26,0. TDF 130% - 185% of poverty # 94.5 203.7 206.8 3. ſ Below 130% of poverty 234.8 243.8 246.9 3.1 Snacks Served (millions): Above 185% of poverty }{}_{} 9.7 $0.0 {}.3 #30% - 185% of poverty ! .3 1,3 1.4 {}, i Below 130% of poverty 203.5 216.6 226.5 9,9 TOTAL, Smacks 214.8 227.6 237.9 {{}.3 Snack subsidy per meal (blended)(cents): Above 185% of poverty 6.0 6.0 6,6 0.0 130% - 185% of poverty 35.5 37.6 37.2 0.2 Below 130% of poverty 71.7 74.0 74.4 {},4 TOTAL, Lunches and Snacks 5,395.8 5,557.3 5,647.5 9{}_2 TOTAL, Meal Reimbursement (millions) $8,983.7 $10,218.2 $10,713.0 $494.8 School Breakfast Program: This program will require an increase of $197,472,000 (about 6.8 percent) for an appropriation of $3,117,863,000 in FY 2011 ($2,920,391,000 is available for FY 2010). The current estimate projects an increase of 85.6 million breakfasts in FY 2011 (about 4.3 percent) above the current estimate for FY 2010. This includes a projected increase of about 93.0 million breakfasts in the free category. The estimate of the total meals projected for FY 2011 is 2.1 billion. Additionally, changes in the reimbursement rates, reflecting increases in the Consumer Price Index (CPI) for Food Away from Home, contributed to the need for increased funding. 645 30- 17 PROGRAM INDICATORS SCHOOL BREAKFAST PROGRAM 2009 2010 2011 PROGRAM PERFORMANCE DATA ACTUAL ESTHMATE ESTIMATE CHANGE Meals Served (millions): Above 185% of poverty 333.8 306.6 288.9 - ) 7.7 Reduce Price, Regular 25.4 26. I 27.2 j. Reduce Price, Severe Need 152.6 164.2 173.4 9.2 130%-185% of poverty, Total 178.0 }90.3 200.6 10.3 Free, Regular ! 22.0 127.7 $33.5 5.8 Free, Severe Need - 1,225.0 1,352.2 1,439.4 87.2 Below 130% of poverty, Total – 1,347.0 1,479.9 1,572.9 93.0 TOTAL, Meals 1,858.8 1,976.8 2,062.4 85.6 Average Daily participation (millions) } }.0 - | 1.7 - 12.2 {).5 Average Subsidy Per Meal (cents): Paid 25.2 26.1 26. j. 0.0 Reduced Price: - Regular | | }.0 } } 6.5 | 18.5 2.0 Severe Need ! 39.0 }44.6 147.5 2.9 Free' - Regular $41. $46,6 | 48.6 2.0 Severe Need 169.0 # 74.5 ! 77.4 4.0 PROGRAM TOTAL (millions) - $2,607.4 $2,897.8 $3,117.9 $220.1 ild and Adult Care Food Program (CACFP): This program will require an increase of $87,831,000 (about 3 percent) for an appropriation of $2,728,754,000 in FY 2011 ($2,640,923,000 is available for FY 2010). he current estimate projects an increase of 40.6 million meals above the FY 2010 estimate, which represents increase of about 2.1 percent above the FY 2010 estimate for meals served in childcare centers, family day |re homes and adult care centers. - he need for additional funds is also due to the projected increase in the number of snacks served under the Frisk component of the program as well as the change in the CPI. This includes increases that result from e expansion of the at-risk component of the program authorized by Section 730 of the Agriculture, Rural evelopment, Food and Drug Administration, and Related Agencies Appropriations Act, 2010 (P.L. I 1 1-80), hich added the District of Columbia, Connecticut, Nevada and Wisconsin to the list of authorized States. he at-risk program is now authorized in the District of Columbia and in thirteen States, eleven of which are umerated in the authorizing legislation. 646 30-18 PROGRAM INDICATORs CHH,D AND ADULT CARE FOOD PROGRAM 2009 2010 2011 - PROGRAM PERFORMANCE BATA - ACTUAL ESTAMATE ESTIMATE CHANGE Meals Served (millions): .* - Centers: - Above 185% of poverty 346. I 327.0 3.19.0 Igº 130% - 185% of poverty. 84,6 79.8 78, T; Below 130% of poverty 855.7 9| 6.9 966.3 49.4 TOTAL, Centers 1,286.4 1,323.7 1,363.4 39.7 Family Day Care Homes: - - - Tier 1 (Low Income) 503.3 503.3 $13,4 5T Tier2 (Upper income) { } {}.6 105. | 00.9 IAF TOTAL, Family Day Care Homes: 613.9 613.4 614.3 0.9 Totai Child Care Program Meals: 1,900.3 1,937.1 1,977.7 40.6 Average Subsidy per meal (cents): 1/ - - º £enters: º- Above 185% of poverty } 7.0 # 7.5 17.7 02. 130% - 185% of poverty I HQ.6 $24.5 i 26,3 1.3 Below 130% of poverty | 59.3 } 64.7 ! 66.9 2.2 Family Day Care Homes - Tier 1 (Low Income) ;38. | 39.5 | 39.8 {}.3 Tier 2 (Upper income) . 64.7 65.3 65.4 {}.} Funding: - - Meai Reimbursement $2,291.5 $2,450.0 $2,557.1 $#07. I Sponsor Admin } 25.6 $28.9 } 32.7 3.8 Audits 32.4 34.8 36.7 1.9 Training & Tech. Assistance 2.2 2.2 2.3 {}, i TOTAL (millions) $2,451.7 $2,615.9 $2,728.8 $112.9 }/ Rates are a blend of all meals types. Summer Food Service Program: This program will require an increase of $9,962,000 (about 2.6 percent) for an appropriation of $397,226,000 in FY 2011 ($387,264,000 is available for FY 2010). The current estimate projects an increase of approximately 5.6 million meals above the estimate for FY 2010, an increase of approximately 4.0 percent, - PROGRAM in DłCATORS SUMMER FOOD SERVICE PROGRAM 2009 2010 2911 - PROGRAM PERFORMANCE DATA ACTUAi, ESTIMATE ESTIMATE £HANGE Meals Served (millions): - Summer Food Program 133.1 }39.7 i 45.3 5.6 Average Subsidy Per Meal (cents): - - Łunch - - 288,0. 2.94.() 298.0 4.0. Breakfast $65,0 168.0. } 71.0 3.0 Supplements 67.0 68.0 69.0 1.0 PROGRAM TOTAL (millions) $356.3 $376.5 $397.2 $26.7 647 Special Milk Program: This program will decrease by $2,076,000 (a 16.4 percent decrease) for an appropriation of $10,597,000 in FY 2011 ($12,673,000 is available for FY 2010). This decreased funding need is a result of a projected decrease in the number of half pints served from FY 2010 to FY 2011 and a projected decrease in the reimbursement rates. The cash reimbursement rate for needy children is adjusted annually on July 1 to reflect changes in the Producer Price Index for fresh processed milk. (2) An increase of $15,395,000 for State Administrative Expenses ($193,258,000 available for FY 2010), Explanation of Change: This increase results from a rise in the estimated program obligations for FY 2009, which is the base year for calculating the availability of funds for this program in FY 2011. An appropriation of $208,653,000 will be needed in FY 2011 for State Administrative Expenses. Each State will receive a grant of at least 1.5 percent of the funds expended for school programs by the State during FY 2009 with a minimum grant of $200,000 plus non-discretionary formula funding for CACFP, which is included in the CACFP line. Funds that are available above the basic grant will also be allocated to the States. State Administrative Expense funds are used for State employee salaries, benefits, support services and office equipment. The base amount of State Administrative Expenses available for allocation to States is equal to 1.5 percent of Federal cash program payments for the National School Lunch (excluding snacks), School Breakfast, CACFP (including snacks) and Special Milk Programs in the second previous fiscal year (i.e., FY 2008 for FY 2010). In FY 2010, $918,807 of the requested $193.3 million in State Administrative Expense funds will be applied to the FNS costs of directly operating Child Nutrition Programs in three States. Currently, FNS directly administers the Special Milk, School Lunch and School Breakfast Programs in three States; the Child and Adult Care Program in one State; and the Summer Food Service Program in one State. (3) An increase of $353,861,000 for Commodity Reimbursement/Procurement ($685,876,000 available for FY 2010). Explanation of Change: An appropriation of $1,039,737,000 will be needed to fund commodity reimbursement and procurement costs in FY 2011. This estimate is based on FNS receiving $465 million in Section 32 support for entitlement commodities. The funding level for FY 2011 reflects changes in the projected commodity reimbursement rates based on the Producer Price Index for commodities. The rate for SY 2009-10 is $.1950, and the rate is projected to be $2025 for the SY 2010- I 1. This ensures that commodity support is adjusted for food cost inflation and maintains a stable base level of support for all meals. Funding is provided for commodity purchases used in the School Lunch, Child and Adult Care Food, and the Summer Food Service Programs, including the costs of procuring those commodities. The Healthy Meals for Healthy Americans Act (P.L. 103-448) amended the Richard B. Russell National School Lunch Act by adding Section 6(e)(1), which requires that not less than 12 percent of the total PROGRAM INDICATORS SPECIAL Milk PROGRAM 2009 2010 2011 PROGRAM PERFORMANCE DATA ACTUAi, ESTIMATE ESTIMATE CHANGE Half Pints Served (millions): Paid (Above 130% of poverty) 72.2 69.3 67.2 -2.1 Free (130% of poverty or below) 6.5 6.9 7.3 0.4 TOTAL, Half pints 78.7 76.2 74.5 -}.7 Reimbursement Rates (cents): Paid 17.7 15.6 14.2 -i.4 Free | 8.9 15.9 } 4.5 -i.4 PROGRAM TOTAL (millions) $14.3 $11.9 $40.6 -$1.3 648 30-20 assistance provided under Section 4, Section 6, and Section 11 be provided in commodities. The FY 2011 request includes $313,006,000 to cover the #2 percent requirement. Normally, approximately $100.0 million in bonus USDA foods, which become available to schools as a result of USDA market support activities, could be used to ensure that FNS would meet the 12 percent requirement. However, Section 6(e)(1)(B) of the Richard B. Russell National School Lunch Act (42 U.S.C. 1755(e)(1)(B)), which provides the authority to count bonus commodities towards the 12 percent requirement, expires on September 30, 2010, resulting in a higher request than would otherwise be required. COMMOBITY COST DATA ($ MILLIONS) 2009 2010 2011 COMMODITY PURCHASES: ACTUAL | ESTIMATE | ESTIMATE I CHANGE CN Appropriation: - AMS/CCC Commodities $465.0 $465.0 $465,0 Ö0" Section 6 Commodities/Cash/Procurement Costs 60 .2 579.6 938.9 $359.5" 12% Commodity Floor Requirement 94.2 3.14.2 0.0 34.2 SCHOOL LUNCH TOTAL }, {60.4 1,358.8 1,403.9 45.T Child & Adult Care Food Program: - Commodities/Cash . - } 14,4 93.6 99.5 55- Summer Food Service Program: - Commodities 1.3 1.3 1.4 0. I TOTAL COMMODITY COSTS 1,276.1 1,453.7 1,504.8 51.] APPROPRIATION $741.2 só85.9 $1,039.7 $353.8 (4) An increase of $30,000 for Team Nutrition ($15,016,000 available for FY 2010). Explanation of Change. This increase provides $30,000 for salaries and benefits. (5) An increase of $7,000 for Food Safety Education ($2,510,000 available for FY 2010). Explanation of Change. This increase provides $7,000 for salaries and benefits. (6) An increase of $82,000 for the Coordinated Review Program ($5,751,000 available for FY 2010). Explanation of Change. This increase provides $82,000 for salaries and benefits. (7) An increase of $28,000 for Computer Support ($9,525,000 available for FY 2010). Explanation of Change. This increase provides $28,000 for salaries and benefits. (8) An increase of $30,000 for Child and Adult Care Food Program Training and Technical Assistance ($3,537,000 available for FY 2010). Explanation of Change. This increase provides $30,000 for salaries and benefits. 2010). ctivities ($3,699,000 available for FY (9) An increase of $16,012,000 for Studies and Other Discretionary A ($3,699, Explanation of Change. This increase provides $12,000 for salaries and benefits. This increase also provides $8,000,000 for a study measuring erroneous payments in school meal programs (see issue paper on page 30-22), and $8,000,000 for a study that would update estimates of the cost to produce reimbursable school meals (see issue paper on page 30–23). 649 30-21 (10) An increase of $2,000,000 for the Farm to School Tactical Team. Explanation of Change. This increase provides $2,000,000 for a tactical team to support local and regional food systems (see issue paper on page 30-24). (11) A decrease of $1,000,000 for School Garden Pilgt ($1,000,000 available for FY 2010). Explanation of Change. This line provided one-time funding for a pilot program in FY 2010. 650 Program: - Proposal: Rationale: 30-22 FNCS PRESIDENT'S BUDGET FISCAL YEAR 2011 CURRENT LAW Child Nutrition Programs Measures of Erroneous Payments in School Meal Programs This study is needed to meet the requirements of the Improper Payments Information Act of 2002 (P.L. 107-300), to assess the effect of policies the Department is implementing to . address the level of erroneous payments in the National School Lunch and School Breakfast Programs, and to provide an updated baseline for annual required projections of erroneous payments. This study largely replicates the methodology of a study conducted Goal: Budget Impact: ($ in millions) for School Year 2005-06; it would collect nationally representative data on certification, meal counting and claiming, and participation during School Year 2012-13 to prepare updated estimates of payment errors in the school meals programs. Since the School Year 2005-06 study, FNS has used an econometric model to project annual erroneous payment amounts and rates from that baseline. FNS made a commitment to the Office of Management and Budget to repeat this study every five years, subject to the availability of funds. This will be the first measure taken since national implementation of the requirement for all local education agencies to directly certify children participating in the Supplemental Nutrition Assistance Program (SNAP). Resuits of this study would be available in 2014. USDA Strategic Goal: Ensure that all of America's children have access to safe, nutritious and balanced meals. FY 2011 Budget Authority $8.0 651 Program: Proposal: Rationale: 30-23 FNCS PRESIDENT'S BUDGET FISCAL YEAR 2011 CURRENT LAW Child Nutrition Programs School Lunch and Breakfast Cost Study HI The level of Federal reimbursement for school meals affects the ability of schools to serve nutritious food and is of continuing concern to both USDA and Congress. In order to ensure that decisions on reimbursement levels are informed by up-to-date, high-quality information on the cost of producing meals and the sources and levels of revenues that cover those costs, FNS conducts a school meals cost study every few years. This study would estimate the cost to produce reimbursable school meals in School Year 2012-13, building on the methodology used to collect this information in School Year 2005-06, but would incorporate additional information on nutritional quality. The study would compare costs charged to school food authorities (SFAs), both alone and in combination with other costs as well as those incurred by the school district in support of SFA operations, but not charged to the SFA, with the Federal subsidy levels for school meals. This will be the first national measure of school meal costs following the economic recession, and the first following publication of the Institute of Medicine report Goal: Budget Impact: ($ in millions) recommending updating of the school lunch and breakfast meal patterns and nutrition standards. Results, available in 2014, would include comparison to results obtained in the previous meal cost studies. USDA Strategic Goal: Ensure that all of America's children have access to safe, nutritious and balanced meals. FY 2011 Budget Authority $8.0 652 Program: Proposal: Rationale: Goal: Budget Impact: ($ in millions) 30-24 FNCS PRESIDENT'S BUDGET FISCAL YEAR 2011 CURRENT LAW Child Nutrition Programs Farm to School Tactical Team . The purpose of the USDA Farm to School Tactical Team (Tactical Team) is to support local and regional food systems by facilitating linkages between schools and their local food producers. The Tactical Team is comprised of both FNS and AMS staff members, who wiłł work with local and State authorities, school districts, farmers, and community partners to develop mechanisms to: assist schools in accessing local markets, enable food producers to effectively service their local schools, and facilitate communication between interested stakeholders. To assist in the growth of Farm to School activities, the team will conduct field work; analyze and assess variables that support or deter farm-to-school activities; identify trends and best practices; maintain a Farm to School Web site; engage in Webinars with interested parties to allow for information sharing of Farm to School obstacles and successes; and provide ongoing technical assistance to schools and producers. The long-term goals of the Tactical Team include: 1) Providing access to resources and information on beginning and maintaining Farm to School activities for schools, farmers and local community members; 2) Providing technical assistance to assist schools and farmers in the development, progression, and/or sustainability of a Farm to School activities; and 3) Identifying obstacles faced by schools and farmers in - implementing and/or sustaining Farm to School activities and provide suggested solutions. The funding requested will fund six FTEs and technical assistance provided by Federal staff in support of this initiative. USDA Strategic Goal: Ensure that all of America’s children have access to safe, nutritious and balanced meals. FY 2011 Budget Authority $2.0 653 30-25 FOOD AND NUTRITION SERVICE . Summary of Increases and Decreases- Proposed Legislation - (On basis of appropriation) 20 i *- Item of Change Current Law Program Changes President's Request Child Nutrition Programs $18,158,393,000 $1,000,000,000 $19,158,393,000 roposal: ationale: FNCS PRESIDENT'S BUDGET FISCAL YEAR 2011 LEGISLATIVE PROPOSAL Child Nutrition and WIC Reauthorization This proposal provides $10,000,000,000 over ten years for a CN reauthorization package aimed at ending childhood hunger, improving nutrition quality, and strengthening program management. USDA's nutrition assistance programs, which serve one in five Americans, are the focus of the Federal effort to fight hunger and improve nutrition in the United States. These programs, which include the Child Nutrition Programs, are core components of the nutrition safety net for America’s children. • Authorization for the Summer Food Service Program (SFSP) and for the Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) expired in September 2009, and the recent 2010 Agriculture Appropriations Act (P.L. 11 1-80) extended key program provisions through September 2010, Reauthorization is an opportunity to consider improvements to all of the Child Nutrition Programs, including the National School Lunch, School Breakfast, Summer Food Service, Special Milk, and Child and Adult Care Food Programs. - - - - The President’s budget supports a strong Child Nutrition and WIC reauthorization package that will ensure that schoolchildren have access to healthy meals and will help fulfill the President's pledge to end childhood hunger. The budget requests $10 billion over ten years for program reforms aimed at improving program access, establishing high standards for the nutritional quality of food available in schools, exploring new strategies for reducing hunger and improving children's food choices, and improving program management. - - Ending childhood hunger – Over 8 million families with children in the U.S. were food insecure in 2008, meaning that they did not have the resources to obtain enough nutritious food for an active and healthy life. In over 500,000 families, children were unable to get enough to eat. The Administration seeks program reforms that will help meet the President’s pledge of ending childhood hunger by increasing access of children to the Federal nutrition programs, testing strategies to better reach and serve hungry children, and improving our understanding of the causes and consequences of childhood hunger. Reducing childhood obesity and improving the diets of children – The high prevalence of childhood overweight and obesity is a looming public health crisis for the Nation. About 17 percent of school-age children are obese, a four-fold increase since the early 1970s. The Administration's reauthorization package supports improvement in the nutritional quality of foods and beverages served in school, strategies to encourage children’s consumption of fruits, vegetables, whole grains, and low-fat dairy products, and strong wellness and physical education policies. 654 30-26 Raising program performance to better serve our children — All government program: rely on public confidence in their efficiency and integrity. The budget request expands technology and training and improves business processes to promote program integrity and reduce errors, and strengthens enforcement tools to resolve management problems. Goal: USDA Strategic Goal: Ensure that all of America's children have access to safe, nutritiou and balanced meals. - Budget Impact: ($ in millions) FY 2011 Budget Authority $1,000.0 655 30-27 Food and Nutrition Service &EOGRAPHIC BREAKDOWN OF QBLIGATIQNS AND STAFF-YEARS 2009 and Estimated 2010 and 2011 2010 || Totals may not add due to rounding. 656 30-28 FOOD AND NUTRITION SERVICE Child Nutrition Programs - Appropriation Classification by Objects 2009 Actual and Estimated 2010 and 2011 (in thousands of dollars) Personnel Compensation: 2009 2010 2011 Washington D.C. $4,002 $5,888 $6,570 Field 4,697 6,912 7,713 || 1 1 || Total personnel compensation 8,699 12,800 14,283 12 Personnel benefits 1,917 2,305 2,533 13 || Benefits for former personnel 0. 0 () Total personnel compensation and benefits 10,616 15,105 16,816 Other Objects: 21 | Travel and transportation of persons 883 893 907 22 Transportation of things 15 15 15 23.1 : Rental payments to GSA 23.2 | Rental payments to others 158 160 1.63 23.3 | Communications, utilities, and misc. charges - 24 Printing and reproduction - 1,685 1,704 1,731 25 | Other Services - 14,392 14,550 14,783 25.1 Contractual Services Performed by Other Federal Agencies 25.2 Related Expenditures 25.3 Repair, Alteration or Maintenance of Equipment, Furniture or Structures 25.4 Contractual Services - Other 25.5 Agreements 25.6 ADP Services and Supplies - 135 | 36 138 25.7 Miscellaneous Services - 25.8 Fees 26 Supplies and materials 717,209 686,492 1,039,737 31 Equipment - 202 204 207 32 || Land and structures - 85 86 87 41 Grants, subsidies and contributions - - 14,700,389 16,317,089 17,206,858 42 Insurance claims and indemnities - 43 | Interest and dividends - 45 Special Payments . 92 | Undistributed Total other objects 15,435,153 17,021,329 18,264,626 Total direct obligations 15,445,769 17,036,434 18,281,442 657 30–29 FOOD AND NUTRATION SERVICE Child Nutrition Programs - Permanent Appropriation Classification by Objects 2009 Actual and Estimated 2010 and 2011 (in thousands of dollars) Personnel Compensation: 2009 2010 2011 Washington D.C. $1,047 $72} $731 Field 1,230 846 858 11 || Total personnel compensation 2,277 1,567 1,589 | 2 | Personnel benefits 537 297 301 13 || Benefits for former personnel 0 {) 0 Total personnel compensation and benefits 2,814 1,864 1,890 Other Objects: 21 Travel and transportation of persons 92 93 94 22 | Transportation of things | } 1 23.1 | Rental payments to GSA 23.2 | Rental payments to others 2 2 2 23.3 | Communications, utilities, and misc. charges 24 | Printing and reproduction 5 5 5 25 | Other Services 227 229 233 25.1 Contractual Services Performed by Other Federal Agencies 25.2 | Related Expenditures 25.3 | Repair, Alteration or Maintenance of Equipment, Furniture or Structures 25.4 Contractual Services - Other 25.5 Agreements 25.6 ADP Services and Supplies 25.7 Miscellaneous Services 25.8 Fees 26 Supplies and materials 7 7 7 31 Equipment 12 12 12 32 Land and structures 41 Grants, subsidies and contributions 56,293 260,807 119,256 42 insurance claims and indemnities 43 Interest and dividends 45 || Special Payments 92 Undistributed Total other objects 56,639 261,156 19,610 Total direct obligations 59,453 263,020 121,500 658 30-30 FOOD AND NUTRITION SERVICE CHILD NUTRITION PROGRAMS SUMMARY OF RECOVERY ACT FUNDING Program/Project/Activity 2009 2010 {} 2011 NSLP Equipment Grants..................... $100,000,000 0 0 PROJECT STATEMENT (On basis of available funds) 2009 2010 Actual Estimated NSLP Grants } Total I Unobligated Balance Start of Year End Program Implementation Activities: Goals and Coordination Efforts: The goals of the NSLP Equipment Grants are to improve program infrastructure and stimulate activity within the American economy through the purchase of school food service equipment. Objectives: • State agencies award grants that best represent the needs in their State, typically reflecting four focus aſ CaS. - - - - o Equipment that lends itself to improving the quality of school foodservice meals that meet the Dietary Guidelines. (e.g., purchasing an equipment alternative to a deep fryer); - o Equipment that improves the safety of food served in the school meal programs. (e.g., cold/hot holding equipment, dish washing equipment, refrigeration, milk coolers, freezers, blast chillers, etc.); - o Equipment that improves the overall energy efficiency of the school foodservice operations (e.g. purchase of an energy-efficient walk in freezer replacing an outdated, energy-demanding freezer); and . o Equipment that allows school food authorities to support expanded participation in a school meal program. (e.g., equipment for serving meals in a non-traditional setting or to better utilize cafeteria space). - - • State agencies must comply with the statutory requirement that grants are to be based on the need for equipment assistance in participating schools with priority (or more weight) given to schools in which not less than 50 percent of the students are eligible for free or reduced price meals. . 659 30-3} Delivery Schedule: The ARRA NSLP equipment grant funds were released to the regional offices on March 18, 2009, and State agencies received the funds within 48 hours. Performance Measures: Target 2009 2010 20 | 1 Students benefiting from improved meals - and more efficient operations 31.2 million 32.1 million 32.6 milion FY 2009 Accomplishments: Funds were allocated to State agencies based on the States' total school meals administrative expense allocation for FY 2009. Two provision were mandated by ARRA: 1) the school participate in the NSLP, and 2) that priority be given to schools in which not less than 50 percent of the students are eligible for free or reduced price meals under the Richard B. Russell National School Lunch Act. The ARRA NSLP equipment grant funds were released to the regional offices on March 18, 2009, and State agencies received the funds within a day or two afterwards. Funding to State agencies was based on a State's total school meals administrative expense allocation for FY 2009. To provide timely impact on the economy, State agencies were strongly encouraged to make NSLP equipment assistance grants (through a competitive grant process) to qualifying school food authorities not later than June 8, 2009. It was also recommend that State agencies encourage grant recipients (i.e., school food authorities), through whatever means available, to fully expend their NSLP equipment assistance grants within three (3) months of the award. Any funds not obligated by the State agency at the end of FY 2009 will be recovered and reallocated by FNS. All funds must be obligated by the end of FY 2010. FY 201 1/2012 Planned Activities: All NSLP Equipment Grant funds were obligated in FY 2009 (a chart displaying the amounts allocated per State is included below); FNS will continue to monitor the outlay of those funds. 660 30-32 Grants 661 30g-1 CHILD NUTRITION PROGRAMS STATUS OF PROGRAM The Child Nutrition Programs account provides funding for the following meal programs: National School Lunch Program, School Breakfast Program, Special Milk Program, Child and Adult Care Food Program, Summer Food Service Program, and Fresh Fruit and Vegetable Program. Program Mission The Child Nutrition Programs improve the diets of children through nutritious meals and snacks based on the Dietary Guidelines for Americans when they are away from home. The National School Lunch and School Breakfast Programs provide such benefits in public and private elementary, middle and secondary chools, and in residential child care institutions. The Special Milk Program provides fluid milk to any articipating public or non-profit private school or child care institution that does not participate in other ederally subsidized meal programs. The Child and Adult Care Food Program provides food for the utritional well-being of young children and adults in day care homes and non-residential centers, and for eenagers in after-school programs in low-income areas. The Summer Food Service Program provides nutritious meals to children in low-income areas and in residential camps during the summer months, and at other times when school is not in session. In participating schools, the Fresh Fruit and Vegetable Program provides free fresh fruits and vegetables outside of the regular meal service to all students. These programs are administered in most States by the State education agency. Where State laws prohibit the State from disbursing funds to private schools and institutions, or in certain instances where States are unwilling to operate a program, FNS administers the program directly through its Regional Offices. REAUTHORIZATION The Child Nutrition and WIC Reauthorization Act of 2004 (P.L. 108-265, the “CN Reauthorization Act”), which amended the Richard B. Russeil National School Lunch Act (NSLA) and the Child Nutrition Act of 1966 (CNA), changed the Child Nutrition Programs in the areas of program access, improved school meals, healthy school nutrition environments, and integrity. The agency has issued new regulations and is in the process of promulgating additional regulations to implement these provisions, which support an increased emphasis on food safety, increased efficiency and accuracy for eligibility determinations, and a reduction in administrative burden. See http://www.fins usda.gov/cnd/lunchſ, under “Reauthorization 2004,” for more information. The upcoming Child Nutrition Programs reauthorization is an opportunity to consider improvements to the USDA’s Child Nutrition programs, including the National School Lunch Program (NSLP) and the School Breakfast Program (SBP). FNS will work with Congress to provide a strong reauthorization bill that improves program performance and program access as well as enhances meal quality and the school nutrition environment. - NATIONAL SCHOOL LUNCH PROGRAM Program Mission The NSLP provides funds to States for lunches served to students during lunch periods at school and for snacks served to children participating in after school care programs. The lunches must be consistent with the statutory and regulatory nutrition standards, which are based on the principles of the Dietary Guidelines or Americans. States are generally reimbursed on the basis of the number of lunches and snacks served to children in participating schools at reimbursement rates that vary according to family need. - Reimbursement for snacks served by schools in needy areas is paid at the free meal rate. The Federal Government pays a base rate for all meals served, including hunches to children whose family income is above 185 percent of the Federal poverty guidelines. A base value for USDA foods is also provided for all lunches. Children from families with incomes at or below 130 percent of the Federal poverty level qualify for free meals, while those from families with incomes between 130 and 185 percent 662 30g-2 qualify for reduced price meals. For the period from July 1, 2009, to June 30, 2010, a child from a family of four with an annual income of $28,665 or less will be eligible for free meals, and a child from a family of four with a family income of no more than $40,793 will be eligible for reduced price meals. The per meal reimbursement rates for meals served are revised on July 1 of each year. The cash reimbursement for a free or reduced price lunch is the sum of Section 4 (base) and Section l l (supplemental) reimbursement rates. School food authorities (SFAs) that served 60 percent or more free and reduced price lunches during the second preceding school year receive increased assistance at the rate of $0.02 per meal served. Facts in Brief • On an average school day in fiscal year (FY) 2009, more than half of all school children in America were provided an NSLP lunch. At participating schools and residential child care institutions (RCCIs), approximately 61.9 percent of the enrolled students participated in the NSLP on a daily basis, up from 61.6 percent in FY 2008. • In FY 2009, a total of 5.18 billion lunches were served in the NSLP, a 0.4 percent decrease from th 5.20 billion served in FY 2007, mainly due to a decrease in days of service from FY 2008 to FY 200 (a 1.1 percent decrease from 180.15 days in FY 2008 to 178.18 days in FY 2009). - • On average, approximately 28.9 million lunches were served daily, a 0.6 percent increase from th FY 2008 daily average of 28.8 million lunches. - - • In FY 2009, approximately 62.4 percent of total meals served were provided free or at a reduced price, up from 60.1 percent in FY 2008. - • The number of schools participating in the NSLP increased by 103 from FY 2008 to FY 2009, and a total of 101,721 schools and RCCſs participated in the NSLP. º Coordinated Review Effort FNS and State agencies conduct NSLP reviews to assess school management of the NSLP, evaluate the accuracy of local meal service data, and provide training and technical support to schools to help ensure local program accountability. Funds allocated for these reviews support the identification of errors that result in improper claims, and support the development of corrective action plans, which assist SFAs in identifying needed improvements to their certification and verification systems. Ultimately, the corrective action plans will result in more efficient distribution of program benefits to eligible children. - School Meals Initiative The School Meals Initiative for Healthy Children (SMI), introduced in the mid-1990s, is a comprehensive effort by FNS and State agencies to assure that school children have access to and are encouraged to consume healthful, nutritious meals that taste good and are consistent with the most recent Dietary Guidelines for Americans, FNS studies indicate schools have made progress towards meeting the SMI nutrition goals, but more needs to be done to accomplish these goals. FNS also continues to revise and update training and guidance materials for State agencies and school districts. These materials are posted on the Team Nutrition Web site and the Partner Web site and include: The Road to SMI Success - A Guide for School Foodservice Directors; - Nutritional Analysis Protocols - How to Analyze Menus for USDA's School Meals Programs; State Agency SMI Reviewers' Monitoring Guide; and SMI Review. Forms. - FNS completed two years of field training (i.e., accompanying State agencies and FNS regional staffon SMI reviews) to complement classroom training. * As part of improving the nutritional quality of school meals, the FNS contracted with the Institute of Medicine of the National Academies (IOM) to independently review and provide recommendations to update the meal patterns and nutrition standards for the NSLP and SBP. In October 2009, the IOM issued a 663 30g-3 comprehensive report with eight recommendations addressing new nutrient targets and meal requirements for school meals, implementation and monitoring of the new requirements, and evaluation and research activities to guide future improvement. The IOM report lays a scientific foundation for updating the NSLP and SBP, and will guide the agency’s efforts to provide nutritious and low-cost school meals. USDA is engaged in a thorough review of the IOM recommendations and will develop a proposed rule to update the school meal programs based on IOM’s final report. Stakeholders and the public will have ample opportunity to comment on USDA’s proposed rule. After all public comments are considered, USDA will issue a final rule to implement the proposed changes. Team Nutrition Team Nutrition's goal is to improve children’s lifelong eating and physical activity habits by using the principles of the Dietary Guidelines for Americans and MyPyramid. Team Nutrition activities strive to instill healthy behaviors in children to prevent nutrition-related health problems, including obesity, diabetes, and other nutrition related illnesses. Team Nutrition complements the President’s efforts to confront the obesity epidemic and to improve the nutrition and health of all Americans. FNS, in cooperation with the National Food Service Management Institute (NFSMI), provides training on the use of Team Nutrition materials to local program operators at State agency and Child Nutrition Programs association meetings. In addition, training is provided through menu planning, food procurement, financial management, leadership, and culinary skills workshops, and through hands-on technical assistance to schools and State agency personnel. Several online training programs are available on the NFSMI Web site at www.nfsmi.org, including procurement training for State agency personnel. A healthy meals hotline provides technical assistance to school food service personnel with questions about menu planning, nutrient requirements, food purchasing, and nutrient analysis. The USDA Recipes for Schools and USDA Recipes for Child Care are available on the NFSMI Web site at http://www.nfsmi.org/information/resourceguide.htm#RECIPES-INDEX and have been revised through the NFSMI cooperative agreement. An updated Serving it Safe food safety manual was recently released. NFSMI also hosts the Child Nutrition Archives, which contain collections of archived materials and oral histories. - Grants: Since 1995, Team Nutrition has provided more than $60 million in training grants to State agencies. These grants are intended to establish and enhance Statewide sustainable infrastructure and training systems to assist local agencies in implementation of USDA’s nutrition requirements, the Dietary Guidelines for Americans, MyPyramid, and other nutrition-related goals. - Materials: Team Nutrition has developed more than 100 different materials of various types, providing nutrition education for children and their families, providing technical assistance for foodservice professionals, and encouraging community support for healthy children. All of the materials are available on the Team Nutrition Web site to download and order. - Following the release of the new MyPyramid food guidance system, FNS launched MyPyramid for Kids and MyPyramid for Preschoolers, child-friendly versions of MyPyramid targeted to school children and preschoolers that focus on making healthful food choices every day. Team Nutrition developed and distributed more than 100,000 MyPyramid for Kids classroom kits. These educational materials for elementary school age children include a child-friendly graphic and slogan, a two-sided classroom poster, classroom lesson plans for grades 1-6, the Tips for Families mini poster, and Blast Off, an interactive learning computer game. In 2009, Team Nutrition distributed over 1.7 million copies of Eat Smart. Play Hard.” campaign materials through Team Nutrition elementary schools. These materials convey and reinforce the principles of the Dietary Guidelines for Americans and MyPyramid and emphasize how to make nutritious food choices and be physically active. In 2009, Team Nutrition distributed more than 255,000 copies of MyPyramid Pointers to Help Your Preschooler Develop Healthy Habits to parents and caregivers of pre-school age children. The MyPyramid Pointers publication features the MyPyramid for Preschoolers graphic and strategies for helping 664 30g-4 preschoolers develop healthy eating habits, including how to deal with picky eaters, introduce new foods and encourage physical activity. These pointers emphasize the influence parents have on their preschoolers’ eating habits through role modeling and cooking and eating together. Also distributed to caregivers of preschool age children is Team Nutrition’s new Two Bite Club Storybook which introduces young children to MyPyramid for Preschoolers and encourages them to taste new foods from each food group. Over 64,000 copies were ordered between July and September of 2009. Middle and high schools and afterschool programs continued to receive Nutrition Essentials, which includes posters and lesson plans based on the Dietary Guidelines and MyPyramid. Developed for afterschool programs, Empowering Youth with Nutrition and Physical Activity provides innovative activities and games designed to teach youth how to make smart eating and physical activity choices. Team Nutrition maintains a Directory of Chefs that are willing to volunteer their time in schools to inspire children about cooking and making healthful food choices. Currently, 180 chefs across the Nation are listed. The directory compliments USDA’s new Chefs in the Cafeteria online resource tool. This tool connects chefs-to-schools and schools-to-chefs as a means for facilitating the sharing of ideas and techniques for improving the nutritional quality of foods offered in school cafeterias. The HealthierUS School Challenge recognizes Team Nutrition schools that demonstrate a commitment to the health and well being of their students, and supports the President’s goal to improve the health and well being of all Americans. Recently, FNS expanded The HealthierUS School Challenge to also recognize middle and high schools that take specific steps to improve their nutrition and physical activity environments. Previously, the voluntary challenge recognized only elementary schools that met rigorous criteria for the nutritional content of their school meals and provided nutrition and physical education as well as other opportunities for physical activity to students. Today, USDA has recognized over 600 elementary schools at one of four levels of superior performance: Bronze, Silver, Gold, and Gold of Distinction. In addition, FNS provides support to school and childcare foodservice staff through the Web-based Healthy Meals Resource System, which provides access to print and electronic training materials and the Education and Training Materials Database – a database of common foods, USDA foods, and new recipes. Procurement Training FNS has been working in conjunction with the NFSMI to develop a Web-based procurement training to provide State agencies with a better understanding of how to best perform responsibilities in the area of school food authority procurements in the National School Lunch and Breakfast Programs. Overall, this training project is intended to: • Enable State agencies to understand Federal requirements pertaining to the procurement process, especially the requirement for free and open competition; • Help State agencies provide training to SFA's on the regulatory requirements governing procurement practices, including the final rule effective November 2007; • Assist State agencies in their review of SFA compliance with the requirements governing the procurement process through Coordinated Review Efforts or other oversight efforts; and • Provide technical assistance to SFAs on proper procurement practices. FNS developed and made initial training available in FY 2009; additional training modules are under development. SCHOOL BREAKFAST PROGRAM Program Mission The School Breakfast Program (SBP) provides funds to States for breakfasts served to students at or close to the beginning of their day at school. The SBP is available to the same schools and institutions that are eligible to participate in the NSLP. For each breakfast served, schools are reimbursed at established rates 665 30g-5 for free, reduced price, and paid meals. Schools in which 40 percent of lunches served to students during the second preceding school year were served free or at a reduced price receive higher “severe need” reimbursements for breakfasts served free or at a reduced price. Children from families that meet the income eligibility guidelines can qualify for free or reduced price breakfasts. The income eligibility guidelines for the SBP are the same as those for the NSLP. Per meal reimbursement rates for meals served are revised on July 1 of each year. Facts in Brief • In FY 2009, program availability rose to 88,060 institutions (an increase of 0.9 percent from FY 2008) with an enrollment of 44.5 million students (an increase of 1.5 percent from FY 2008). This is more than double the FY 1990 levels of 42,766 institutions with an enrollment of 20.7 million. • The program was available to 88.2 percent of the students enrolled in schools participating in the lunch program in FY 2009, as compared to 50 percent in FY 1990. Average daily participation in FY 2009 was 11.0 million, an increase of approximately 3.8 percent from the prior year. - • The portion of total meals served free or at a reduced price was about 82.0 percent during FY 2009, up from 80.6 percent in FY 2008. • Approximately 1.86 billion breakfasts were served in FY 2009, an increase of 2.5 percent over FY 2008. On average, 10.2 million breakfasts were served daily, compared to 9.8 million in FY 2008, or a 3.8 percent increase. FNS continues to work with State agencies to improve participation by supporting creative approaches to breakfast service, such as classroom service of meals, kiosks, and increased use of alternative techniques to meal counting and claiming. SPECIAL MILK PROGRAM Program Mission The Special Milk Program (SMP) has encouraged consumption of fluid milk since 1955. Any public or non-profit private school or child care institution that does not participate in other Federal meal programs, such as NSLP, SBP or Child and Adult Care Food Program (CACFP), may participate in the SMP. However, schools in the NSLP or SBP may also participate in the SMP to provide milk to children in half- day pre-kindergarten and kindergarten programs where these children do not have access to the school meal programs. Participating schools and child care institutions are reimbursed for part of the cost of milk served to children. Facts in Brief • The number of half pints served as part of the SMP decreased from 85.7 million in FY 2008 to 78.7 million in FY 2009, an 8.2 percent decrease. Overall, the number of half pints served has decreased from 181.3 million in FY 1990, a 56.6 percent decrease. • A total of 5,611 schools, non-residential child care institutions and summer camps participated in the SMP in FY 2009, a 6.0 percent decrease from the FY 2008 level of 5,971. The number of participating schools and summer camps decreased by 390 and 46, respectively, Non-residential child care institutions increased by 76. • The portion of half pints served free during FY 2009 was about 8.3 percent, as compared to 7.8 percent in FY 2008. 666 30g-6 CHILD AND ADULT CARE FOOD PROGRAM Program Mission The Child and Adult Care Food Program (CACFP) provides cash and USDA foods, or cash in lieu of USDA foods, for food service to: children in non-residential child care centers and family or group day care homes; children and teenagers in afterschool programs in low-income areas; children, through age 18, who reside in homeless shelters; and chronically impaired adults and persons 60 years of age or older who are enrolled in adult day care centers. In order to participate, child care centers must be either public or private non-profit or for-profit centers in which at least 25 percent of their enrollment or licensed capacity receive Title XX funds or are eligible for free or reduced price school meals. Adult day care centers must provide nonresidential adult day care, be either public or private non-profit, or for-profit centers in which at least 25 percent of their participants are eligible for free or reduced price meals or are receiving Title XIX or Title XX funds. All participating providers must be licensed or approved according to Federal, State or local standards. Outside-school- hours care programs and at-risk afterschool centers in areas where Federal, State or local licensing or approval is not required may participate in CACFP by meeting State or local health and safety standards. Funds are made available to the States for audit expenses associated with the administration of the CACFP. FNS directly administers the CACFP in the Commonwealth of Virginia. The Virginia Department of Health will begin direct administration of the Child and Adult Care Food Program effective October 1, 2010, Centers receive applications from parents or adult participants and make eligibility determinations based on family size and income, essentially following the same guidelines used in the NSLP. Centers receive reimbursements based on a free, reduced price, or paid meal rate for each eligible meal type they serve (CACFP facilities may serve breakfasts, lunches, snacks, or suppers). Family or group day care homes receive reimbursement under a two-tier system intended to target program funds to support low-income children, while requiring less paperwork than would be necessary if the NSLP guidelines were used. Under this system, a higher reimbursement rate is paid to daycare homes located in areas where at least 50 percent of the children are eligible for free or reduced priced meals or where the provider's household size and income meet the established income criteria for free or reduced price meals. The higher rate of reimbursement may also be paid to providers who receive benefits under the SNAP. All other homes receive reimbursement at a lower rate, except where individual children who are enrolled for care in the home are determined to be eligible for the higher meal rate. Facts in Brief • In FY 2009, the combined average daily attendance in CACFP was approximately 3.3 million children and adults, virtually unchanged from FY 2008. • Of 3.1 million children in average daily attendance in FY 2009, approximately 2.3 million were in child care centers and approximately 845,000 were in family day care homes. • On average, in FY 2009 a CACFP child care center had about 46 children in attendance on an average day, and received slightly more than $28,000 a year in meal reimbursement. • By comparison, on average a family day care home cared for and fed six children on an average day, and received slightly less than $5,500 a year in meal reimbursement. • Total meal service was relatively unchanged from FY 2008 to FY 2009; a total of 1.90 billion meals were served in FY 2009. • In FY 2009, approximately 84.8 percent of total meals served were provided free or at a reduced price, up from 81.4 percent in FY 2008. Agency Expands Program Integrity Efforts FNS continues to address management weaknesses identified by Federal and State reviews and Office of Inspector General (OIG) audits. Regulations finalizing two interim rules implementing the provisions of the Agricultural Risk Protection Act of 2000 and recommendations found in OIG audits are under development. In an effort to measure the effectiveness of the CACFP management improvement 667 30g-7 egulations and guidance, FNS conducted 60 Child Care Assessment Projects between FY 2004 and 2007. The results of these evaluations have been issued. OIG is conducting a follow-up audit to further valuate the effectiveness of the implemented management improvement regulations and guidance. The udit is expected to cover fiscal years 2007 through 2009 and will evaluate a sample of local, State, and ederal program administration. - Improving Nutrition NS is working to improve the nutrition and health of CACFP participants through two key efforts. FNS as contracted with IOM to review the CACFP meal patterns and make recommendations for bringing the rogram’s nutritional requirements in line with the current Dietary Guidelines for Americans and other levant scientific knowledge on the nutrition needs of the populations served by the program. FNS expects to receive the IOM recommendations in late 2010. Additionally, the Agriculture, Rural - evelopment, Food and Drug Administration, and Related Agencies Appropriations Act, 2010 (P.L. 111- 80) authorized the Secretary to provide $8 million in competitive grants to State agencies administering the ACFP for projects aimed at improving the health and nutrition of children in child care settings. FNS xpects to award these grants in FY 2010. - - - - SUMMER FOOD SERVICE PROGRAM Program Mission The Summer Food Service Program for Children (SFSP) provides funds for food service to needy children during their summer break from school or during lengthy breaks for children in year-round schools. Participating institutions must serve children in areas where poor economic conditions exist. Institutions must be public or private non-profit schools, government agencies, private non-profit organizations that meet certain criteria, residential camps, or National Youth Sports Programs. Meals are served free to all participants through age 18 and are limited to two meals (but not lunch and supper) or one meal and one snack. Summer camps or migrant programs may be reimbursed for up to three meals or two meals and one Snack served to each eligible participant daily. In addition to cash support, USDA foods are distributed to program sponsors that are schools, that prepare their own meals, or that obtain their meals from schools. Funds also are made available to conduct health inspections and to defray State and local administrative costs, - Facts in Brief • During July 2009, the peak month of program operations, over 2.2 million children participated in the program on an average day, an increase of 4.2 percent over the slightly more than 2.1 million children that participated in FY 2008. • During FY 2009, 34,596 feeding sites provided 133.1 million meals to needy children through the SFSP. This is an 2.6 percent increase from the 129.7 million meals provided in FY 2008, and a 5.7 percent increase in the number of feeding sites (up from 32,723 in FY 2007). • In FY 2009, approximately 59.5 percent of the meals served were lunches (compared to 59.8 percent in FY 2008), 25.8 percent were breakfasts (25.6 percent in FY 2008), and the remaining 14.9 percent were suppers and supplements (14.6 percent in FY 2008), Promotion of SFSP Improving access to the SFSP has been a long standing priority for FNS, However, the program is still reaching only a fraction of the children in need of nutrition assistance when school is out. The Agriculture, Rural Development, Food and Drug Administration, and Related Agencies Appropriations Act, 2010 (P.L. 11 I-80) authorized the Secretary to conduct demonstration projects to develop and test methods of providing access to food for children in urban and rural areas during the summer months aimed at reducing or eliminating food insecurity and hunger among children and improving their nutritional status. The Act 668 30g-8 provided $85 million to conduct these demonstrations. FNS is working to develop demonstration projects that will include rigorous evaluation of the policy changes and alternative service delivery models tested. FRESH FRUIT AND VEGETABLE PROGRAM Program Mission The Food Conservation and Energy Act of 2008 (P.L. 101-246, the “2008 Farm Bill”) permanently authorized the Fresh Fruit and Vegetable Program (FFVP) nationwide and provided a substantial increase in funding annually. The 2008 Farm Bill amended the NSLA by adding Section 19, which authorizes the new FFVP, and deleted Section 1868), which provided prior program authority. Funding for school year (SY) 2008-2009 was $40 million with an additional $9.9 million available through the FY 2008 appropriations. The FY 2009 appropriations delayed $49 million of the $65 million available under the 2008 Farm Bill for SY2009-2010 until FY 2010. In total, funding provided for SY2009-2010, including recovered funds from the prior year, was $72.5 million. The funding was made available to all fifty States, the District of Columbia, Guam, Puerto Rico and the Virgin Islands. FNS has taken the following steps to implement the new FFVP nationwide: • Issued implementation, guidance and technical assistance materials; Held conference calls, with our Regional Offices and their State agencies to provide guidance on the implementation process, program operations and strategies for success; • Presented twice at the School Nutrition Association Annual National Conference Updated the FFVP Guidance Manual to reflect new statutory authority; • Continued to work with our Regional Offices and State agencies to provide guidance and technical assistance; • Began development of a proposed regulation; and • Began development of an on-line toolkit to encourage participation and to aid in the understanding of the FFVP. RECOVERY ACT FUNDING On February 17, 2009, the President signed into law the American Recovery and Reinvestment Act of 2009 (P.L. l l 1-5, the “ARRA”), which, among other programs, provided a one-time appropriation of $100 million to carry out competitive grants at the local level for NSLP equipment assistance. Funds were allocated to State agencies based on the States’ total school meals administrative expense allocation for FY 2009. Two provision were mandated by ARRA: 1) the school participate in the NSLP, and 2) that priority be given to schools in which not less than 50 percent of the students are eligible for free or reduced price meals under the Richard B. Russell National School Lunch Act, The goals of the ARRA NSLP equipment grants were to improve program infrastructure and to stimulate activity within the American economy through the purchase of school food service equipment. State agencies awarded grants that best represent the needs in their State, reflecting four focus areas: • Equipment that lends itself to improving the quality of school foodservice meals that meet the Dietary Guidelines for Americans. (e.g., purchasing an equipment alternative to a deep fryer); • Equipment that improves the safety of food served in the school meal programs. (e.g., cold/hot holding equipment, dish washing equipment, refrigeration, milk coolers, freezers, blast chillers, etc.); • Equipment that improves the overall energy efficiency of the school foodservice operations (e.g., purchase of an energy-efficient walk in freezer replacing an outdated, energy-demanding freezer); and • Equipment that allows SFA’s to support expanded participation in a school meal program. (e.g., equipment for serving meals in a non-traditional setting or to better utilize cafeteria space). The ARRA NSLP equipment grant funds were released to the regional offices on March 18, 2009, and State agencies received the funds within 48 hours. To provide timely impact on the economy, State 669 30g-9 gencies were strongly encouraged to make NSLP equipment assistance grants through a competitive rant process to qualifying school food authorities not later than June 8, 2009, and all States completed the rant award process in FY 2009. It was also recommended that State agencies encourage grant recipients i.e., school food authorities), to fully expend their NSLP equipment assistance grants within three (3) months of the award, FOOD SAFETY tood safety education funds are used to reinforce and expand FNS’ efforts to provide Child Nutrition 'rograms operators with continuous, effective training and technical assistance in food safety and food lefense, FNS develops materials, ensures their delivery at all appropriate levels, makes training available t all possible levels, and facilitates the implementation of food safety requirements into the operators’ food ervice operations. - - Food defense activities *NS initiated a food defense project following four years of nationwide awareness training conducted by *NS. The awareness training encouraged State and local program operators to develop food defense plans nd pinpointed resource materials to assist in the development of the plans and then test the plans using the roduct developed from this project. The contract for the project was awarded and plans for the first pilot xercise in South Carolina were initiated. The project will culminate in the release of a turnkey package at State Agencies or school food authorities can use to conduct a tabletop exercise. The deliverable date r the resource kit is projected to be September 2010. FY 2009, FNS worked in collaboration with the U.S. Department of Education's Office of Safe and rug-Free Schools on food defense as an essential component of a comprehensive emergency management lan for the Readiness and Emergency Management for Schools (REMS) program. REMS is a iscretionary grant program to help school districts develop comprehensive plans for any emergency or risis, including development or revision of food defense plans. Food safety issues Food Allergies – FNS hosted a food allergy working group meeting with partners from the Centers for )isease Control and Prevention (CDC). Participants represented the medical profession, industry groups, chool food service at the State and district levels, and Federal partners from the Food and Drug Administration and the Department of Education to review education materials and training needs for chool personnel, FNS sponsored a series of three Webinars on managing food allergies in schools in ollaboration with the School Nutrition Foundation, focused on understanding allergy fundamentals, eveloping policy, and implementing policy. There were approximately 2,500 participants in the ebinars. FNS also sponsored a day session on food allergies at the 2009 Annual National Conference of e School Nutrition Association. Safe Food Cooling – FNS is collaborating with the Food and Drug Administration's Center for Food Safety and Nutrition and the National Center for Food Safety and Technology on research into the :ffectiveness of current cooling practices used in schools that will establish best practices for cooling. Cooling practices were assessed prior to determining study protocol. During FY 2009, studies of cooling methods for specific foods were completed and computer models were developed for use in foodservice ducation programs Produce Safety – FNS developed a produce safety fact sheet for school foodservice directors, which will be istributed through the National Food Service Management Institute on their Web-site and in print to State gencies. FNS worked with Agriculture Marketing Service to develop an agreement to create a “produce afety university” that will train State agencies and food service directors on produce purchasing and afety, FNS, the University of Maryland, and the Joint Institute for Food Safety and Nutrition planned a roduce safety workshop to identify potential risks and mitigation steps for produce, which will be held in arly FY 2010. 670 30g-10 Norovirus Outbreak Prevention - FNS analysis of data from the Centers for Disease Control and Prevention found that norovirus is the leading cause of food borne outbreaks in schools. FNS partnered with the National Education Association Health Information Network to create and disseminate a booklet for school foodservice workers as well as custodians, teachers, and other staff on the prevention of norovirus outbreaks in schools through proper cleaning and sanitation. Food Safety Complaints Involving USDA Foods - The Electronic Commodity Ordering System (ECOS) is a Web-based system that allows States to submit food quality or food safety complaints in the following categories: 1) quality issues, such as: Quality of Product, Foreign Material, Poor Packaging, and Cooking/Preparation; and 2) food safety issues, such as: Foreign Object, Allergic Reaction, Illness, Injury, or other potential food safety issues. In FY 2009, FNS continued to monitor and investigate food safety complaints such as problems with mixed fruit and diced chicken. Rapid Alert System (RAS) - FNS implemented an electronic tracking and communication tool to support food safety activities in the NSLP and other USDA food distribution programs in FY 2006. The RAS, an integral part of ECOS, allows FNS to provide emergency food safety information to recipient States, such as hold and recall alerts and documentation about USDA purchased foods. The RAS also allows States to submit detailed information on recalled product disposition. In FY 2009, the RAS was used to recall approximately 1.6 million pounds of peanuts and peanut butter. The RAS was also used to facilitate a hold on 180,000 pounds of frozen blueberries. The RAS dramatically reduced the time required to notify program operators about the hold and recalls and obtain information on the disposition of the products from them. Commodity Alert System - As an outcome of the Hallmark/Westland beef recall, FNS added a feature that allows the general public to sign-up to receive email notices on food safety issues for USDA foods that rise to the level of potentially significant public health concerns. Food safety research, training, and other resources were developed by NFSMI using funds provided under food safety cooperative agreements with FNS, NFSMI will continue to conduct research, develop training resources, and conduct evaluations in the area of food safety, Food Safety Inspection Compliance The CN Reauthorization Act increased the required number of annual school food safety inspections from one to two. Reports submitted by the State agencies for SY2007-2008 indicate that: 71,582 (70%) schools met or exceeded the requirement; 18,565 (18%) reported one inspection; 9,21 1 (9%) reported zero inspections; and 2,703 (3%) did not report any inspection data to their State agency. The vast majority of required information has been reported to FNS by State agencies. FNS is working with some State agencies to get complete data. Reporting delays are generally due to communication problems between a State agency and the SFAs related to problems in new computer programming. Some of the reasons cited by State agencies for schools not meeting the inspection requirement are: • Insufficient funds/staff at State and local public health agencies to handle increased inspection load; • The public health agencies prioritize inspections according to risk; schools are a low priority; and • Lack of local public health inspectors in small towns and rural settings. FNS will continue to communicate with State agencies, inspectors, and other stakeholders to ensure that schools make progress in meeting the inspection requirement. At the same time, State agencies will continue to assist their SFAs through technical assistance, administrative reviews, and other means. During administrative reviews, SFAs will be asked about the schedule of food safety inspections. Written guidance used by State agencies for administrative reviews has been recently updated to include the food safety inspection and reporting requirement. 671 - 30g-11 ACQUISITION AND DISTRIBUTION of USDA Foods Eight nutrition assistance programs incorporate USDA foods as part of the overall assistance provided to recipient agencies. The Farm Service Agency (FSA), Agricultural Marketing Service (AMS) and FNS work together to provide USDA foods to these programs in the types, forms, and quantities needed to meet planned levels of assistance. In addition to providing food to people who need it, purchases of USDA foods support domestic agricultural markets. The USDA foods subsidy for the NSLP and CACFP is authorized by Section 6(c) of the NSLA and is based on a "rate per meal" concept which is adjusted each July 1 to reflect changes in the Producer Price Index for food used in schools and institutions. Similarly, Section 13(h) of the NSLA authorizes USDA foods for the SFSP. Additionally, Section 6(e) of the NSLA requires that in each school year, not less than 12 percent of all Federal nutrition assistance in the NSLP be provided in the form of USDA foods. When available, USDA also provides bonus foods acquired through the price support and surplus removal programs. The value of bonus food is counted towards the 12 percent requirement above. The 2008 Farm Bill increased funding for the purchase of fruits, vegetables, and nuts for USDA’s domestic nutrition assistance programs from $390,000,000 in FY 2008 to $393,000,000 in FY 2009, and provides for graduated annual increases in this funding in FY 2010 through FY 2012. At least $50,000,000 of these funds, annually, must be used to purchase fresh fruits and vegetables for distribution to schools and service institutions. - FY 2009 USDA Foods Assistance Rate For SY2008–2009, schools, daycare centers and residential institutions were authorized to receive an average of 20.75 cents worth of USDA foods per lunch/supper served. The rate for USDA foods decreased to 19.50 cents on July 1, 2009, for SY2009-2010. USDA foods provided to Child Nutrition Programs (excluding bonus and cash in lieu of entitlement USDA foods) totaled $1,032.1 million for FY 2009. Cash in Lieu of USDA Foods Section 6(e) of the NSLA authorizes funds to be used to provide cash in lieu of USDA foods. The State of Kansas is permanently receiving cash payments in lieu of USDA foods as a result of the NSLA and Child Nutrition Act Amendments of 1975. Cash is also being received by sites that participated during the 1980s and early 1990s in alternative demonstration projects that provided cash or Commodity Letters of Credit in lieu of USDA foods. Some nonresidential child care institutions have also elected to receive their USDA foods entitlements in cash. Electronic Commodity Ordering System ECOS allows State agencies to submit orders for USDA foods directly into a centralized Web-based computer interface that provides greater access, input, and transparency to the food distribution process. Several State agencies have rolled out ECOS to the school district level. FNS expects some States to accomplish this roll-out prior to USDA’s introduction of the new Web-Based Supply Chain Management (WBSCM) System that will replace the current outdated mainframe system used within USDA for the purchasing, tracking, shipping, and payment of USDA foods. Receiver organizations, such as warehouses and processors, continue to register in ECOS to monitor and acknowledge receipt of orders for USDA foods. The improvements in electronic communication enhance the timely flow of USDA foods throughout the program supply chain. ECOS continues to be the system used by State agencies to submit requests for USDA foods. ITOs use ECOS to submit requests to their assigned Multi-Food National Warehouse. There are currently more than 9,000 users of ECOS. This user base includes USDA, State agencies, local school districts, area food banks, and receiving organizations. State Agencies that are utilizing ECOS in some fashion for their order collection activities at the recipient level are: Connecticut, New York Office of General Services (including the Board of Jewish Education), Connecticut Department of Social Services, District of Columbia State Education Office, Maryland Department of Education, Pennsylvania Department of 672 30g-12 Agriculture, Virginia Department of Agriculture, Florida Department of Agriculture and Consumer Services, Georgia Department of Education, Kentucky Department of Agriculture, North Carolina Department of Agriculture and Consumer Services, Michigan Department of Education, Ohio Department of Job and Family Services, Louisiana Department of Agriculture and Forestry, Texas Department of Human Services, Nebraska Health and Human Services, Utah State Office of Education, and California Department of Education, - - In FY 2009, critical ECOS system modifications were made only as needed to complete required business functions. Two release level updates were implemented for ECOS which provided needed functionality to assist in the transition towards WBSCM. Bonus Donations of USDA Foods USDA supports domestic production agriculture through the Surplus Removal Program administered by AMS and the Price Support Program of FSA, USDA foods acquired through these programs are donated to FNS for distribution to nutrition assistance programs as “bonus” foods. Distributions are limited to the types and quantities of product FNS determines can be used without waste, based on market needs, and the needs of FNS outlets and programs. • Surplus Removal Program: In FY 2009, approximately $126.6 million of perishable and semi- perishable bonus USDA foods were delivered to schools and other eligible child nutrition outlets under the Section 32 Surplus Removal Program authority. In addition, over $54.2 million of fruit and vegetable products were delivered to schools under the 2008 Farm Bill. • Price Support Program: In FY 2009, over $51.7 million of cheese and milk products were purchased and donated to Child Nutrition Programs. USDA Foods Administrative Expenses USDA also funds some of the operational costs of the Processed Commodity Inventory Management System (PCIMS), which integrates the purchasing, tracking, shipping, and payment of USDA foods performed by FNS, AMS, and FSA. The three agencies are working on the development of the new WBSCM system to replace PCIMS and its satellite systems. Department of Defense Fresh Produce Project FNS and the Department of Defense (DoD) work together to enable school districts to obtain fresh produce. Under this joint venture, schools can use their USDA foods entitlement to order fresh produce through DoD's contracting and distribution network. This project has grown steadily since its beginning in SY 1994-1995, and 47 States, Puerto Rico, the District of Columbia, Guam and the Virgin Islands spent a combined total of $54.2 million in entitlement funds on produce through this program in SY 2008-2009. In addition to these Federal purchases, 35 States, Puerto Rico, the District of Columbia and the Virgin Islands used Section 4 and 11 funds to purchase over $16.8 million in fresh produce directly from DoD. STATE ADMINISTRATIVE EXPENSE FUNDS Section 7 of the CNA authorizes funds to the States for program administration and for supervision and technical assistance in local school districts and child care institutions. In FY 2009, an initial amount of $179.0 miliion was allocated for State Administrative Expenses (SAE), including $102.4 million for administration of the school food programs, $61.3 million for the administration of the CACFP, and $15.2 million for the administration of the Food Distribution Program. In addition, $3.1 million in SAE funds were reallocated to State agencies for approved projects. Funds appropriated for SAE are available to States for obligation over a two-year period. The State agency may carry over up to 20 percent of the initial allocation. Each fiscal year, carryover exceeding the 20 percent limit is recovered by FNS, 3 * - 673 30g-13 CHILD NUTRITION PROGRAMS STUDIES AND EVALUATIONS The following studies and reports were released by FNS in FY 2009 and are available on the FNS Web site at http://www.fas.usda.gov/ora. Accuracy of LEA Processing of School Lunch Applications - Regional Office Review of Applications (RORA) 2007 - October 2008: This is the third in a series of annual reports assessing administrative error associated with local educational agency 2008 meals and snacks for free and reduced-price school meals. The percent of students with administrative errors in the processing of their applications for meal benefits has remained relatively stable over a 3-year period, with administrative error ranging between 3 and 4 percent. Direct Certification in the National School Lunch Program: State Implementation Progress Report to Congress - December 2008: This is the first in an annual series of reports mandated by the 2008 Farm Bill. The 2004 Child Nutrition and WIC Reauthorization Act established a three year phase-in period, ending in school year 2008-2009, over which time all local education agencies are required to begin directly certifying SNAP participant children for free school meals. This report offers an interim assessment of State and local direct certification systems in SY 2007-2008, one year prior to full implementation of the 2004 Act’s direct certification requirement. Results of the Feasibility Study of Estimating the Risk of Meal Claiming Error in the Child and Adult Care Food Program (CACFP) - May 2009: The report examined the feasibility and accuracy of using sponsor monitoring data to assess the accuracy of CACFP meal claims in family day care homes. The report found that the tested method does not provide a reliable estimate of family home day care meal claiming error. Child and Adult Care Food Program (CACFP) Assessment of Sponsor Tiering Determinations 2007- May 2009: This is the third wave (2007) of a program assessment of the Family Day Care Home (FDCH) component of CACFP. The assessment provides a national estimate of the share of CACFP-participating family day care homes that are approved for an incorrect level of per meal reimbursement, or reimbursement "tier," for their circumstances. Tiering errors result in improper payments because misclassified FDCHs do not receive the appropriate level of reimbursement for the meals and snacks provided to the children. The assessment also estimates the dollar amount of improper payments attributable to FDCH tiering errors. Child and Adult Care Food Program (CACFP): Improper Payments Data Collection Pilot Project - September 2009: The purpose of this pilot was to test possible methods that could lead to valid estimations of the number of meals served by FDCHs. The pilot tested methods based on observations of meal services, analysis of sign-in/sign-out (SISO) logs, and parent interviews. The pilot found that parent recalls, when restricted to their own children, do correspond to independent observations of meals served to their children by the day-care provider. Therefore, parent recalls hold promise for validating whether meals claimed for children of interviewed parents are erroneous. School Meals: Building Blocks for Healthy Children - October 2009: This report, commissioned by FNS and prepared by the IOM, reviews and assesses the food and nutritional needs of school-aged children in the United States using the 2005 Dietary Guidelines for Americans and the IOM's Dietary Reference Intakes to provide a basis for recommended revisions to the NSLP and SBP Nutrition Standards and Meal Requirements. The goal is the development of a set of well-conceived, practical, and economical recommendations for standards that reflect current nutritional science, increase the availability of key food groups as appropriate, and allow these two meal programs to better meet the nutritional needs of children, foster healthy eating habits, and safeguard children's health. 674 30g-14 CHILD NUTRATION PROGRAMS FINANCING FOR FISCAL YEAR 2009 State and Cash Child Stfrnmer School in-lieu of And Adult Food $22,282,780 $3,601, $282,706,121 43,370,514 32,005, 345,534,957 3,447 196,403,426 1,957,622,648 188,240,404 115,841,123 48,389,914 30,696,282 893,731,023 679,569,102 52,610,049 73,916,231 560,292,459 46,427 315,402,216 16,748, 136,886,944 $47,832,939 52,597, 259.182,756 55,087 321.168,186 7 51,324,039 212,654,035 244,142,644 405,421,931 $16. 24,424, 234,130,648 138,277 - 17,207 245,418,t71 20,393. 10,883, 101,452,076 59,629, - 8,677. 89,374,588 33,122,788 28, 197 315,288,456 10,903, 158,692,120 81,637 968,929, 175 46,463, 506,150,500 3,737 - 32,160,509 499.731.426 17,039, 245,583,815 160,014,397 489,668,475 4,038, 41,244,815 21,537 270,755,308 41,001,935 183. 343,514,047 1,049,661, 434. t,798,629,177 76,597 124,927,988 $1,504, 23,440,034 187 º 237,274,669 142,487 250,860.6+ 1 96,244,959 e 220,350,938 40,887 º 22,162,463 0 8,348,635 Mariana 0. 213,639,478 rust f 0. 8,234,324 0. Tribe S6! T {} 0 i0 8,742,920 8,145,176 0 of Jewish {} NOTE: Data is based on obligations as reported September 30, 2009. Commodities are based on food orders for fiscal year 2009, Totals may not add due to rounding, 675 30g-15 FOOD AND NUTRITION SERVICE CHILD NUTRITION PROGRAM Quantity and Value of Commodities Fiscal Year 2039. ENTITLEMENT COMMOOTIES Pounds Dołians ECTION &/32 : APPLE SLtCES 4.885,280 $2,375,388 APPLES 1,523,689 786,187 APPLESAUCE 30 7.793,532 3,287,382 ApriCôT3 1,994.738 12tº,543 BEANS, BLK TUTL 10 104,977 38,498 BEANS, BLKEYE CND 559,878 205.27% BEANS, GBzC, CND 349,920. 150,382 BEANS, GREAT NORTH 25 80,000 35,838 BEANS, GREAT NORTH CND 104,976 37,308 BEANS, GREEN 10 22,768,982 10,958,848 BEANS, GREEN FRCZEN . 3.952,500 2,154,188 BEANS, MitMEY CNG §§4,820 317,884 BEANS, NAVY PEA 25 40,000 17,424 BEANS. Pink CND $43,784 412,624 BEANS PINTO 25 580,000 218,054 BEANS PłNYO Chlº 4,624,088 1,484,596 bÉANS, REFRIED 1,560,384 823,483 BEANS. SREC, CND 804,816 387,222 BEANS, VEG 40 5,073,862 1,811,235 BEEF PATTES. ALL 40 2,432,000 4,545.207 BEEF PATTES, LEAN 40 1,178,000 2,360,822 BEEF PATHES, SPP 40 2,984,000 4,580,162 BEEF, 40 27,474,400 49,391,804 BEEF, BULK COARSE 74,424,000 123,732,223 BEEF, CND 24 Qz $84,000 1,637,190 BEEF. Cººb 2,280,000 3,991,872 BEEF, SRECIAL TRAM FRZ 1,250,000 3,590,742 BF BNLS FRSH CGMBO 3,400,000 T.429,954 BF PTY LFT 114,000 270.813 BF PTY SPP CKDHSY 40 2,358,000 4,278,233 BONELESS PłCNHC 601 3. 11,965,980 10,512,912 CARROTS, 10 4,547,116 2,334,112 CARROTS, 30 3,564,000; 1,502,158 CATFISH STRiPS 406,000 1,633,800 CHERRIES FR2 75,800 70,453 CHKCKEN BURGERS FRZ 234.000 477,554 CHKCKEN CND 337,502 737,438 CHHCKEN i EGS CHit L 6,300.000 3,885,526 CHICKEN, BREADEB 7.751,000 t3,735,495 CHCKEN, CHILLED BULK 159,408,000 108,129,593 CHKCKEN, CUT-UP FROZEN 8,534,380 8,523,346 CHKCKEN, DKCED FROZEN 4,560,000 9,497.18% CHKCKEN, FAJITA MEAT FROZEN 7,371,000 13.798.284 CHICKEN, LKGHT 3ULK 108,000 32,400. CHKCKEN, THIGHS 8ULK 72,[K}} 42,120 CORN CO3 4,870,800 2,648,468 CORN LOO 10 24,625,210 10,280,697 CORN, FROZEN 14.985.800 6,688,163 CRANBERRY SAUCE 683,552 28t,489 DPSC-FRESH PRODUCE 57.352,956 EGGS, WHCit: #Rºº! 8,882,440 3,544,710 EGGS, WHOLE t (QUIC $1,808,603 6.777,453 FRUIf MIX 10 32,735.64% 22,555,229 HAM COOKED FRZ CUBE 1,520, 2.705,998 HAM COOKED FRZ St. KCED 4,520,000 7,815,749 HAM, F&z WATERAXO 40 4,780,000 5.280,735 ORANGES 743,883 282,011 PEACHES, C: Rig 49,435,874 32,965,434 . pBACHES, Cúp 4.4 8,349,380 7,823,494 PEACHES, FROZEN 228,000 158,395 *EARS, CANNEQ 36,970,569 23,852,882 PEARS, FRESH 567,000 250,911 PEAS, CANNED 4,468,997 2,296,531 PEAS, FROZEN 3,972,300 2,508.206 PORKC SLCPPY JOE 280,000 352.345 PORK, CAM NED 24 QZ 584,000 4,310,287 PORK, ROAST FRCXEN 5,460,000 3,048,451 POTATO ROUNDS, FROZEN 14,493,800 6,183,948 POTATO WECGES, FROZEN $9,892,D\}0 5,900,765 POTATOES, Būl K. PROC 79,580,000 8,043,749 POTATOES, OVEN 3, #38,000 5,407.554 POTATOES, RUSSE’ſ 120,000 34,872 RA|SiMS 548,493 737,822 SALSA, CANNED 6,887,890 3,136,894 SPAGHETTI SAUC#, CANNED 14,087,740 3,588,245 STRAWBERRIES 9,773,100 10.443,678 SWEET POTATOES 3,848,005 1,520,578 TOMATO PASTE. Buik 5,638,850 2.825,272 TOMATO PASTE, CANNED 2,277,727 t,503,43? “ TOMATO PASTE, DRUM 462,240 ,' 274,345 TOMATO SAUCE, CANNED 3,593,740 1,282,344 TOMATOES, BKCEQ CANNEO 4,255,853 1.941,333 TUNA 86.5 2,082,791 4,801,645 TUNA, POURCH 888,286 t,964,342 TURNEY, BREAST ĐELI FROZEN 9,540,000 16,389,515 TURKEY, CHill ED BUt-K 25,020,000 20,399,278 TÜRKEY. GROUND 200,000 259,0& TURKEY, HAM FROZEN 4,960,000 6,421,208 TURKEY. ROASTS FROZEN 10,920,000 15,464,707 TÜRKEY. TACO 2,418,000 3,252,284 TURKEY. WHOLE FROZEN #38,000 731,024 agº: #777; sº- Totsi Section 5/32 Type º 676 30g-16 FOOD AND NUTRITION SERVICE CHILD NUTRITION PROGRAM (Cont.) Quantity and Value of Commodities Fiscat Year 2009 NTFLEMENT COMMOG}TiES Pounds Dollars SECT 438 TYPE: i. BSW 19.184,400 $3,794,313 CHEES: BARREL 50.3 28,040,000 40,988,411 £HEESE i CAVE& 4,276,500 6,333,058 CHEESE MOZ2ARELLA 99.461,920 148,846,712 C#EESE, CHEDDAR 2,476,90t 4,015,856 CHEESE, CHEDDAR, RED, FAT SHRED 5,808.400 8,674,514 CHEESE. CHEDDAR. REDúCEO FAT 278,850 494,817 CHEESE. CHEDDAR, SHREDDED 6,180,000 10,347,113 CHEESE. KQSHER SLC 198,000 344,386 CHEESE, REDUCED SKłº St.C 10.215,800 $4,823,685 CHEESE, SLiCEO - 23,740,400 31,283,887 £GRN, YELLOW 780,300 $5,422 CQRNMEAl. 283,880 58,181 FiORjR 24.404,220 5,731,372 FLOUR M.D., t_OWFAT 388,800 353,697 GRITS 214,200 52,433 MACARON: t,338,000 584,470 MACARON, WHOLE GRAIN 643,000 321,474 MASA 53 YER_LOW * 259,200 59.075 *Mii-K, UHT #14,429 84, #42 OATS, Röit ED 760.352 232,894 Gil. SOYBEAN LSF 850,079 607,453 Cil, VEGETABLE 11,897.775 8,219,542 PEANUT BUTTER 9,222,580 8,884,594 Rice, BROWN 7.974,000 749,524 R}CE, L & M. 8,862,000 4,155,257 RłCE. PARBOILED 1,470,000 508,049 RºßSºft) RUNººki 89,420 $37,504 ROTiNt 1,064,000 489,819. ROTINI, WHot E GRAPN 1,707,000 501,815 SPAGHETºi 4,822,000 885,724 SPAGHEFTA, WHOLE GRAiN 2,195,000 937,778 SºftNFLCºSF BUTHER 480,480 730,442 Total Secton 416 Type -ārīg-i-º- Anticipated Adjustmani 18521,328 AMS P FSA f PCHMS Admin, Expenses 5,145,176 |TOTAL COMMOpff'ſ ENTITLEMENT 1,089,043,858 1.056,738,656 t CºMMGG|THES Pounds Dollars SECTIGN, 32 TFFE**: APPLE SLICES 15,402,592 $14,857,647 APPEESAUCE 28,5t4,631 $3,841,660 Appricofs 4,954.842 3,807,977 £5Aft's 19,386,334 9,285,242 BUACKBERRY PRODUCTS $20,410 634,623 BLUE3:RRIES 6,258,520 7.129,964 BONELESS PICNIC 540,320 587,493 CAT FISH STREPS 720,000 2.969,596 CHERRYES T.389,596 4,957,922 £HHCKEM 20,788, 14,744,550 CRANBERRY PRCDUCTS 346,500 1,033,387 HAM FROZEN 4,340,000 7,093,579 CRANGEJ 17,577.1.20 7,528,044 PORK ROAST 1,840,000 2.272,037 POTATO PRODUCTS 1.680,000 147,159. RAISiMS 1,342,656 $.503,304 SALSA 2,213,379 1,060,902 SPAGHETTI SAUCE 1,967,789 712,954 foſſa TO PASTE 3,018,593 1,956,852 TOMATO SA&CE 906,363 322,400 TOMATOES, DiCED 1.744,203 899,30t TURYEY PRODUCTS 18,189,157 27,114.15i WAL}{L}{S 2,415,500 4,828,739 Tolai Section 32 Type 755,357.555 #7 25.573,775 BONUS COMMOOTić& Pounds i}ollars CTION 416 TFF: CHEESE, CHEQūAR 6,144,000 $8,970,240 CHE:SE, REDUCED SKIM 10,058.400 14,112,724 {NSTANT 2 845,120 803,488 #MG22 LT SHRED FRZ 8,153,920 3,618,467 NFD Bº X.25 KG 10,747.361 5,803,822 PANCA KE 2.063,880 2,042,214 TORT fill AS 3 280 500 1,730,334 UHT ºilº 3% 9,993,459 5,345,255 Tołat Section $16 typa 49,996 640 $54,597.255 Articipated Adjustmartt YCTAL BOM:US CCMMODITES 206,459,793 $176,270,995 TOTAL - ALL & Rºſas #357 503 05: $7 337.367,537 £ash in-lieu of Cotnmodities 134,237,485 ūRANõ TOTAL 394,503.05? 1,366,285,346 Sourca: PCiºłS - Defivery order and contract information * Figures include Farrn Bái Procurements, 677 30g-17 FOOD AND NUTRITION SERVICE BPSC-FRESH PRODUCE values are from 2009 ECOS Entitlement Report. CHELD NUTRITON PROGRAM Value of Commodities to States Entitlement and Bonus ... Fiscal Year 2009 STATE OR TERRITORY Entitlement Bonus Total - Alab $16,826,495 $3,835,266 $20,656, F&# * Alasks 4,424,383 235,750 1,660,143 || Ari 26,383,139 3,150,647. 28,533,786. . Aſ 11,938,449. 2,419,748 13,458,188. Calif 103,557,433 19,098,248 $22,649,579 tº £olorado $5,406,715 2,305,715 17,715,430 º —Af 10,851,608 4,708.354 12,559,962 Thał 2,304,910 158,779 2,960,689. District of Columbia.................. 1,333,731 74,904 1,408,635, Florida º º a 59,813,839, i. 10,632,819 70,446,658 Georgi .. 45,057,373 ... 6,302,373 52,369,746 Hawaii 4,605,531 485,320 5,070,951 Idahry. 5,408,088 1,354,735 5,459,863 |minois 31,874,700 3,701,881 35,576,581 ...” i-ºº--- 26,744,434 2,634,234 29,378,728 loºſa..., - - - $3,339,842 4,254,734 i4,594,576 Kansas {} {} 9 Kentucky 18,243,770. 3,567,829. 21,811,599 i ruti $7,374,423 3,947,792 21,292,215 Mairise 3,399,935. 364,744 4,364,573 Mary; $8,819,798 4,959,924 23,779,722 * A husetts.......................... 20,252,737 3,546,031 23,768,766 Michig 31,306,248 4,892,443 36,198,689. * : *t- 19,367,506 2,099,571 21,267,077 Mississippi 42,815,426. 3,645,213 45.861,639 Hº ºf 16,670,982 3,036,542 49,707,524 Monta 2,476,058 382,890 2,858,948 . *— a 7,824,081 1,798,053 9,622,134 Nevad 7,372,746 1,150,602 5,523,346 New Hampsh 3,723,758 B29,004 4.552,752 . New Jersey 20,463,445 5,049,786 25,542,932 New Mexico......................... * * * * * 7,643,457 1,626,671 9,270,128 New York 84,093,539 9,100,033 73,193,547 North Carolina 33,716,000 8,694,042 42,440,012 North Dakota............................ 2,318,219 875,819 3,194,038 {}hiº -. 39,004,248 8,411,887 A7,415,435 {{#tahfarria $2,244,874 2,501,019. 14,742,833 Oregon 9,498,865 1,476,383 t{},973,254 p ylvani 42,224,279 5,353,618 47,577,897 Rhode island............................ º 3,043,055 682,393 3,725,448 South Cardina 18,233,025 2,137,965 26,370,990 lsouth Dakota............................ 3,087,553 438,374 3,525,927 T 25,970,079 3,279,997 29,250,075 Texas 105,485,152 16,841,894 i22.028,045 {#tah 12,772,670 1,863,696 14,636,366 Vermont............................... 1,679,915 645,367 2,295,282 Virgini 19,972,910 5,049,311 24,992,221 Washingt * t4,932,709. 3,467,933 18,400,642 Wast Virginia............. * * * * * * * * * * * * * * * * 6,687,720 1,400,294 7,788,014 § * 16,519,791 2,116,346 18,636,407 |Wyoming 2,088,320 224,481 2,342,501 łAmerican Samoa....................... {}. {} {} Galarn f21,813 30,050. 151,663 inorthern Mariaria islands............ º {} {} Q Puerto Rico * * * * * * * * 12,869,995 3,868,782 tö,738,777 Trust Territory..........., * ū {} {} Virgin islands............................ 453,673 {} 453,673 Indian Tribes Set Askie............... {} 0. Q indian Tribes {} {} O Freely Associated States............, {} {} 0. |ºld of Jewish Education,.......... {} {} {} tºoD Army f AF.,...................... {} 0. {} { AARES 534,988 {} 634,988 AMS f FSA f PClºſs.................... 8,145,476 0. 8,445,176 a -am-- * – -º 18,524,328 {} $8,521,328 Toral - $1,058,736,686 $478,270,995 $1,237,007,681 Source: PCMS - Deivery order and contract information, . . . - - Nota: Figures include Farm Bº Procurements; Kansas racelves all assistance as cash in Hsu, 678 30g-18 school. LUNCH ProGRAM THOUSANDS OF #_UNCHES SERVED FISCAL YEAR 2009 TOTA; i.UNCHES SERVED - REDUCED STATE ORTERRITORY PAIO PRICE FREE TOTAL Alab 35.742 8,580 53,028 97.320 Alaska 2,894 f,022 4,810 8,726 Arizona 33,423 10,828 65,015 309,265 A → 18.133 6,201 32,88t 57,244 California— - 132,682 74,252 370,034 576,948 £nlpfart 28,140 6,497 29,611 84,249 tº AE - - - #. 26,170 4,485 20,206 50,861 F}a} wer 6.723 1,063 6,590 34,375 District of Columbia * 1.723 671 4,926 7,319 Florida 73,173 30,218 156,330 259,719 G 78,248 20,642 118,339 217,228 Hawaii 9,681 2,491 7,143 19,315 Idaho 11,913 3,735 11,447 27,096 #linois-- **sassrººs. 66.346 15,308 108,062 189,416 * -- ~i? 63,915 $2,805 54,573 131,292 Iowa 39,768 5,874 20,094 65,736 Kansa 28,429 6,234 21,843 56.505 #Kentucky----- 35,685 8,285 45,734 39,703 H buisi 31,200 7,601 54,489 93,290 Maine 8,610 1,671 8.111 18,392 Maryland 30,980 7,629 32,104 70,713 * * ~ - - & A. 47,317 6.4.22 36.738 90,477 Michig 55,108 12,662 72,385 140,155 tº £2 **. 61,593 11,088 29,255 101,936 & sº 15,990 6,423 45,554 67.967 a ºf —º 48,332 9,921 47,558 105,822 * * ~ *- i. 7,009 1,700 5,673 t4,382 * * ~ *. 21,612 4,172 12,895 38,679 Nevada t{},653 3,898 18,345 32,896 New Hampshire $2,995 3,535 4,942 19,471 New Jersey— tº 51,598 $1,034 50,896 113,528 New Mexico— 9,108 3,950 23,972 37,029 New York 105,455 29,195 157,151 29t,8G1 North cºns– 57,845 16,572 88,329 162,746 North Dakota--------------- 8,506 1,084 3,547 13,108 hio 80,368 15,385 83,856 179,618 {}iclzeň 24,869 7,673 38,165 70,707 Oregon 15,282 5,413 25,138 47,533 Pennsylvania 96.869 16,839 75,629 $89,338 Rhode island ". 4,828 1,300 7,286 f$,414 South tº- 27,234 7,079 50,214 84,527 South Dakota— 9,576 1,655 6,051 t?.282 T 40,042 9,997 61,551 111,590 Texas 151,929 51,304 328,328 531,561 Utah 31,844 6,439 18,614 56,895 Vermo 4,740 856 3.207 8,802 Virginia 62,459 11,684 48,316 122,459 W wº 33.835 10,738 42,165 86,738 West Virginia-——------ 14.312 3,276 15,685 33,272 Wi sº 54,948 8,757 34,188 97,863 Wyomi 5,277 1,119 2,738 9,134 American Samoa--~~ Q O Q {} Guarn 959 172 1,907 3,038 North Mariana islands wº 0. O 0. {} Puertº Ri 9,567 5,559 40,655 55,791 Trust Territory (excluding NM}}– Q O {} O Virgin islands---— 545 175 1,599 2,289 indian Tribe Set Asi------- 0 O - O Q indian Tribes 0. 0. {} Ö Freely Associated States--- G 0. 0 | () DOD ArmylafiušMC/Navy- 2,523 926 926 4,376 Anticipated Adjustment- {} O 0 () TOTAL 1,949,399. 521,802 2,709,870 5,130.981 NOTE: These data are based in part on preliminary data submitted by State and kcal agencies and are subject to change as revised reports are received. Totals may not add due to rounding. 679 ROTE: These data are based in part on preliminary data submitted by State and local agencies and are subject to change as revised reports are received. Totals may not add due to rounding. 30g-19 SCHOOL i UNCH PROGRAM SCHOOLS, ENROLLMENT AND PARTICIPATION FISCA YEAR 2009 PEAK - numbHR OF ENROLLMENT PARTICIPATHON STATE OR TERRITORY SCHOOLS (000) (000) Alabama i,520 756 60? Alaska 429 117 54 uizona 1,745. 1,033 853 Ari 1,196 488 360 California 10,75? 6,268 3,260 Čriºrari 1,678 869 385 fºr rinaefkºni! 1,172 544 320 That 242 127 92 District of Cohumbia 215 88 45 Fiorida 3,606 2,696 1,563 Georgia 2,393 1,671 1,314 Hawaii 391 180 92 łdaho 707 242 173 |linois 4,335 1,887 1,172 *--if 2,254 1,412 772 łowa 1,492 536 40? Kansas 1.60% 512 363 ** -- a-- – 2 4,347 884 715 # out 1,610 784 605 Maine $97 193 440 Maryland 1,569 863 438 * #5 2,256 973 562 Michig 3,811 4,688 939 Minnesota 2,414 916 §22 * * ...— ...— e. * 350 516 419 - ax 2,524 915 554 † 805 146 83 * - a--- ~ * 984 302 248 Nevad 576 423 488 New Hampshire 498 498 113 fiew Jersey ***** 2,687 1.285 715 *New Mexico— 796 3.18 224 New York . 5,887 2,989 1,835 North Carolina—— 2,509 1,487 977 North Dakota --tº- 413 101 83 Ohio. 4,063 1,902 1,134 Okiah 1,894 652 445 Oregon 1,383 583 3.18 Pennsylvania 3,848 1,826 1,166 Rhode Island- - -- 430 458 82 iSouth Carolina— 1,168 733 510 South Dakota— 888 437 108 T - 1,772 929 594 Texas—— 7,869 4,713 3,320 Utah 86t 540 340 Vermont 349 94 55 Virginia 2,034 1,244 7.59 Washingt 2,105 1,033 541 West Virginia—— 755 297 218 Wi l– 2.479 907 595 Wyoming 355 86 57 iAnterican Sarnoa-------- 0. O {} Suam 45 33 19 North Mariana Islands— 0 () O Puerto Rico 1,831 61 ; 394 Trust Territory (excluding NMI)— {} 0. O Virgin islands —------ 64 20 44 Indian Tribe Set Ask--- O {} {} iridian Tribes {} O 0. Freely Associated States {} {} () DODf Army|AFRUSMC/Navy—— 92 50 27 Anticipated Adjustment {} O O TOTAL 104.723 50,404 31 352 680 30g-20 SCHOOL BREAKFAST PROGRAM SCHOOLS, ENROLLMENT, AND PARTICIPATKON FISCAL YEAR 2009 NUMBER OF TREAR SCHOOLS AND} ENROi-LMENT PARTICIPATION STATE OR TERRITORY inSTITUTIONS _{009) Alab 1,434 703 225 Alaska 317 88 17 Arizona--— 1,563 973 230 Ar; 1,169 482 164 California 8,755 5,455 1,497 Colorado 1,4t 1 §4? 14t Conflèëticut 63? 295 7+ Delaware 238 128 33 District of Columbia 195 64 22 Florida. sº 3,572 2,625 637 Georgia 2,343 1,506 589 Hawaii—— 288 177 44 ldaho---------——— 662 232 73 ſtinois 3,084 f,404 290 Indiana——— 1,953 990 2.47 łowa **** ~~~~ 4,365 513 89. Kansas---------------------- 1,494 445 400 K & 1,334 674 246 i ouisiana 1,504 736 256 Maine---~~ 633 179 36 Maryland 1,478 8t3 158 * husetts 1,58t 656 $41 Michig 3,107 1,408 284 ël ºt & 1,623 740 145 tº ºf pp.; 870 458 213 * ºf - 2,270 857 242 à i -- ~ * 699 $29, 26 * † - 6- - -- ~ if 702 236 59 Nevada 533 397 56 Mew Hampshire 448 $68 22 New Jersey 1,782 837 174 New Mexico * 768 312 132 Rew York 5,225 2,650 588 North Carolina 2,490 1,468 379 North Dakota- 347 90 20. Ohio 3,028 1,384 372 Oklah 1,897 625 217 Oregon 1,300 581 144 Pennsylvani 3,333 1,538 295 Rhode island- 447 154 25 South Carolina 1,460 73i 259 South Dakota—— 545 1636 25 Tennessee 4,674 863 251 Texas 7,867 4,699 1,577 Utah 719 461 73 Vermont 322 90 22 Virginia * 4,904 1,132 242 Washingt 1,939 951 174 West Virginia--- 758 295 105 º, ºº sº 1,571 653 $42 Wyoming 294 75 14 Americar, Samoa-—- 0. {} Q §uam 4t 30 8 Worth Mariana islands— 0. O {} Puerto Rico—--~~~~~ 1,831 611 142 Trust Territory (excluding NMi}——----- G {} Ö Virgin islands 42 17 5 Indian Tribe Set Asi- {} Ú {} indian Tribes 0. {} {} Freely Associated States tº {} 0. o DOD AmylàFIUSMC/Navy— {} {} 0. Anicipated Adjustment Ö {} Ö TOTAL 88,060 44,492 11,375 NOTE: These data are based in part on preliminary data submitted by State and iocal agencies and are subject to change as revised reports are received. Totals may not add due to rounding. 681 30g-21 SCHOOL BREAkFAST PROGRAM ThousANDS OF BREAKFASTS SERVED FiSCAL YEAR 2009 FREE T OT A L BR EAK FAST S S E R V E D REDUCED PRICE - |STATE OR TERRITORY PAlī) FEGULAR lSEVERE NEED REGULAR_i SEVERE NEED TOTAL Alabama— - 5,427 384 2,420 1,975 25,314 35.520 Alaska—-------- 630 13 285 53 1,866 2,847 Arizona 6,80? 444 3,202 2,255 26,717 39,389 Af; - 3,900 175 2,250 1,084 17,407 24,847 California— 24,925 1,644 23,899 7,248 159,305 216,991 Črninrari 3,604 392 1,793 1,107 10,750 17,646 C w" w w 4,987 158 915 780 8,314 12,154 TYal - 1,475 110 309 539 2,886 5,420 District of Columbia—— 755 28 275 $25 2,298 3,481 Florida 18,300 1,124 8,783 5,881 67,785 101,872 Georgia 17,393 1,250 7,463 6,225 62,849 95,180 Hawaii 2,426 257 600 853 2,765 6,700 Idaho- 2,870 165 1,287 700 6,254 11,274 Illinois 6,060 533 2,728 3,115 37,737 50,173 Indiana 6,426 859 2,588 4,234 21,265 35,371 towa 4,345 593 871 2,308 8,233 14,349 Kansas 3,105 478 1,420 1,634 8,645 15,283 Kentucky 7,755 388 3,091 2,079 25,388 38,701 l 6,017 26? 2,500 1,927 27,854 38,560 Maine 1,606 $40 549 609 3,444 6,349 Maryland 6,737 388 2,420 1,808 13,834 25,187 * A husetts 4,001 297 1,457 1,932 15,778 23,465 Michig 7,421 481 2,897 3,214 31,028 45,042 tº ºf 6,415 1,482 1,742 3,543 9,450 22,302 ſº Jº ipſ 3,506 $1 2,494 284 27,157 33,492 fºr - 8,844 642 3,179 3,316 23,333 39,343 * * 1,037 132 398 437 2,316 4,320 h 2,781 365 880 1,215 4,308 9,350 Nevada 1,727 133 945 754 6,661 10,220 New Hampshire - 1,585 228 98 1,078 959 3,948 New Jersey— 4,636 344 2,540 4,681 20,283 29,494 New Mexico— 4,125 71 2,024 451 14,708 21,380 New York——— 48,628 t,529 8,105 5,888 65,000 99,151 North Carolina 10,694 573 5,240 3,366 42,281 62,151 North Dakota 1,316 164 148 523 1,058 3,309 Ohio 12,204 733 3,801 5,048 37,162 58,948 Oklah 6,503 325 2,996 1,570 22,243 33,636 Oregon—— 4,980 $33 2,136 681 13,636 21,566 P yivania— 11,190 1,296 3,012 5,969 27,831 49,299 Rhode isiarid - 700 52 2.94 322 2,798 4,166 South Carolina— 7,826 308 2,954 1,867 29,134 42,090 South Dakota —— 959 183 226 581 2,355 4,304 Tennessee 7,470 456 3,547 2,780 30,746 44,999 Texas— 41,331 2,776 19,152 14,996 172,389 250,644 Utah 2,487 397 994 1,526 5,655 11,039 Vermont 1,030 148 288 497 1,504 3,467 Virginia- 9,705 993 2,929 5,574 19,382 38,583 Washingtº 4,365 53; 3,572 0 17,539 26,007 West Virginia 4,309 138 1,330 577 8,643 14,997 Wi - 5,780 909 1,500 3,760 11,225 23,174 Wyoming 773 101 230 295 # 972 2,371 American Samoa-— 0. 0. 0 {} 0 0. Guam 165 O 52 0. 1,075 1,292 North Mariana islands—- - O O {} {} O Q . Puerto Rico— 2,621 10 1,913 88 16,959 21,571 Trust Territory - (excluding NM}--——H. Q 0 {} {} {) 0 Virgin islands - 463 O 55 {} 519 737 Indian Tribe Sel Asi O Ú O {} {} O Indian Tribes {) O 0 Ö {} {} Freely Associated States— 0. 0 {} 0 O 0 DOD Army/AF/USMC/Navy–H {} 3 {} 5. 0 9 Anticipated Adjustment— () O 0. {} O Q TOTAL 333,796 25,437 152,547 121,978 1,224,999 1,858,758 NOTE These data are based in part on preliminary data submitted by State and local agencies and are subject to change as revised reports are received. Totals may not add due to rounding. 682 30g-22 CHii.D AND ADULT, CARE FOOD PROGRAM PARTICIPATION AND MEALS SERVED. FISCAL YEAR 2009 NUMBER PARTICIP. STATE CR OF ATKON TERRITORY CENTERSf PEAK *- DAY CARE HOMES MONTH PRICE TOTAL HOMES TOTAL 1,122 280 0. 3,558 1,781 9,539 17, 11,451 26, Mariana Territory {exciuding Tribe Set Associated NOTE: These data are based in part on preliminary data submitted by State and local agencies and are subject to change as revised reports are received. Totals may not add due to rounding. 683 30g-23 suMMER Food service ProgRAM NUMBER of srſes, PARTICIPATION AND MEALs served FISCAL YEAR 2009 NUMBER PARTICIPATION TOTAL MEALS -*. OF (JULY) SERVED STATE OR TERRITORY SITES {000). (000) A iſ -i- 497 27 1,175 Alaska 79 2 210 Arizona 21 12 1,282 Aſ 275 17 1,213 Całłł 1,464 97 7,788 ſºninrari 191 43 769 C Af.-- . A $34 10 575 {}glaw 351 11 1,048 District of Columbia 270 35 1,262 Florida 2,635 128 40,403 Georgia 1,203 68 3,804 Hawaii $44 6 340 idaho 242 23 1,471 |illinois 1,297 50 4,115 *— — .5 942 55 2,604 Iowa 200 10 620 Kansas 187 17 765 Kentucky 1,609 55 2,632 f_ntii 34? 27 2,880 Maine 157 7 388 Maryland 1,032 50 2,558 * † ** - - - - ºn 864 51 2,425 Michig 969 61 2,693 in ºf A. 339 30 1,572 tº º w 263 23 #. 1,547 *A fºr r 549 35 4,452 * -- 185 O 384 A f-lº -- ~ * 161 8 700 Nevada 102 6 536 New Hampshire 99 4 288 New Jersey— 1,020 50 3,059 Now Mexico— - 854 43 2,114 flew York — 2,445 436 17,656 North Carolina—------— . 768 49 H. 2,078 North Dakota——— 34 2 t31 Ohio- 1,514 65 i. 3,611 fºlklah 342 13 4.238 Oregon---— *ºrº 580 37 1,604 Fennsy s 1,847 97 5,332 Rhode island- 145 7 271 South Carolina- 941 55 2,512 South Dakota *-*- : 50 4 317 T 1,030 29 2,767 Texas 2,554 182 13,725 Utah 85 17 655 Vermont 96 3 479 Virginia 1,474 52 3,486 Washingt 584 41 1,428 West Virginia-—- 40? 45 772 Wł * 504 45 1,976 Wyoming 49 3 180 łAſhbrican Samoa 0 0 Q Guarn - Q 0 {} North Mariana Islands Q {} - 0 Puerto Rico-----— 322 30 5,394 Trust Territory - (excluding NMI)——— O O O Virgin Islands- º-º-º: 157 7 385 Indian Tribe Set Aside {} 0 0 indian Tribes ** Q {} {} Freely Associated States— Q 0 0. DOD Army/AFIUSMC/Navy— Q 0 i. 0 Anticipated adjustment: 0 0 Q TOTAL- **t 34,596 2,219 133,078 NOTE: These data are based in part on preliminary data submitted by State and local agencies and are subject to change as revised reports are received. Totals may not add due to rounding. 684 30g-24 SPECIAL ML K PROGRAM HALF-PiMTS OF MILK SERVED FISCAL YEAR 2009 AVERAGE SERVED DALY TOTAL SERVED FY 2009 FREE PAHD TOTAL FREE PAID TOTAL STATE OR TERRITORY {000) (000). (900) (900) {000) _{000) Alabarma O 1 1. 2 221 223 Alaska 0. 0. 0. 32 25 58 Arizona O 2 2 58 347 374 Ar; Q Ö 0 3 49. 52 California- t 12 12 49? 2.84% i. 3,032 fºrminrart 0 5 5 35 896 930 C tick 4 9 10 437 1,746 1,852 D {} 2 2 {}, 230 230 {District of Cokumbia {} {) 0 {} 50 50 Florida {} 1 1 2 238 240 Georgia {} f t 0 184 181 Hawaii Q 0. {} Ö 11 11 ldaho Q 5 5 20 4,217 1,237 tilinois 14 98 112 2,373 16,269 18,642 fl--sº {} 6 6 137 1,233 #,420 Wº 0. 1 1 8 407 415 Kansas 4 3 3 89 516 605 Kentucky 0. 4 4. 35 572 588 { {} 1 4 O 180 180 *Maine {} 0. 0. 36 182 498 Maryland 0. 15 15 7 2,384 2,391 tº At 1–- - - - Aa t 8 9. 104 2,424 2,229 Michigan. 1 15 17 229 3,222 3,450 Minnesota {} 18 18 4. 4,553 4,557 * † ipp Q 0 O 0 17 17 ºf —f Q 48 18 460 2,937 3,098 à a Ö 1 1 46 108 124 * † - R. 0. 1 1 4. 261 265 Nevada O {} O 7 467 474 New H fl. 1 0 2 3 44 1,096 1,140 New Jersey---~~~~ + 24 25 247 3,963 4,119 New Mexico.--~~~~! {} 0 0 34 5 36 New York —--—- 1 22 23 1,587 3,545 5,132 North Carolina— 0. 5 5 85 1,048 1,133 North Dakota *** **** O 0. O 3 234 234 Ohio- 1 17 18 4 16 3,100 3,216 ſłkirah {} 1 1 37 496 233 Oregon 0. 4 4 40 742 782 Pennsylvania 1 12 13 180 3,335 3,515 Rhode island--~~~~ 0. 1 t 29 451 480 South Carolina *- 1 O t 68 {} 68 South Dakota—— {} 1 f 9 267 275 Teſ 0. O O 46 {} 46 Texas --— 4 t t 214 t23. 337 Utah 0. 2 2 9. 451 459 Vermont O t 1 12 452 464 Virginia {} $0. 10 0 1,605 1,605 Washington O 6 6 7 f,412 1,419 West Virginia—- {} 1 1 28 174 202 Wi 4. 1 25 25 119. 6,494 6,613 Wyoming 0. Q {} {} 90. 90 American Samoa---------- {} () O 0. 0. 0 Guam 0. {} 0. 9 {) O North Mariana islands-—— {} {} 0 O {} 0. |Puerto Rico——- 0. 0 0 O {} Q Trust Territory e - (excluding NMI)—--— 0. 0. 0. {} 0. 0 Virgin Islands 0. () Q 13 {} 13 Indian Tribe Set Asi-—— Q 0. O O {} {} Indian Tribes--- - 0 O 0 O {} {) Freely Associated States—- 0. 0 0 0. Q {} DOD Army/AFIUSMC Navy— {} O {} 0. O 0. Anticipated Adjustment º Q {} O O {} 0 TOTAL **sam-e-ºsmºsº 27 361 388 6,542 72,192 78,733 NOTE: These data are based in part on preſiminary data submitted by State and local agencies and are subject to change as revised reports are received. Totals may not add due to rounding. 685 30g-25 - SPECIAL MLK PROGRAM. NUMBER of PARTICIPATING ouri Ers AND obliganons systATE FiSCA YEAR 2009 CHH D CARE SUMMER 287,791 Mariana must Territory (excluding Tribe Set AS800iated 1/ Obigations as reported September 30, 2009. NOTE: These data are based in part on preliminary data submitted by State and local agencies and are subject to change as revised reports are received. Totals may not add due to rounding. 686 30-33 FOOD AND NUTRATION SERVICE The estimates include appropriation language for this item as follows (new language underscored; deleted matter enclosed in brackets): Special Supplemental Nutrition Program for Women, Infants, and Children (WIC). For necessary expenses to carry out the special supplemental nutrition program as authorized by section 17 of the Child Nutrition Act of 1966 (42 U.S.C. 1786), [$7,252,000,000; $7,603,000,000, to remain 1. available through September 30, 2011] 2012, of which $125,000,000 shall be placed in reserve, to remain until expended, to be allocated as the Secretary deems necessary, notwithstanding section 17(i) of such Act, to support participation should costs or participation exceed budget estimates: Provided. That notwithstanding section 17(g)(5) of the Child Nutrition Act of 1966 (42 U.S.C. 1786(g)(5)), not more than $15,000,000 of funds provided in this Act may be used for the purpose of evaluating program performance in the Special Supplemental Nutrition Program for Women, Infants and 2. Children: Provided further,[That notwithstanding section 17(h)(10)(A) of the Child Nutrition Act of 1966 (42 U.S.C. 1786(h)(10)(A)), of the amounts made available under this heading, not less than $14,000,000 shall be used for infrastructure, not less than $60,000,000 shall be used for management information systems, and not less than $80,000,000) $83,000,000 shall be used for breastfeeding peer counselors and other related activities: Provided further, That none of the funds provided in this account shall be available for the purchase of infant formula except in accordance with the cost containment and competitive bidding requirements specified in section 17 of such Act: Provided further, That none of the funds provided shall be available for activities that are not fully reimbursed by other Federal Government departments or agencies unless authorized by section 17 of such Act. The first change provides language that restores the contingency fund. The second change removes reference to an expired provision of the authorizing statute. 687 30-34 FooD AND NUTRITION SERVICE LEAD-OFF TABULAR STATEMENT AND SUMMARY OF INCREASES AND DECREASES SPECIAL SUPPLEMENTAL NUTRITION PROGRAM FOR WOMEN, INFANTS AND CHILDREN (WIC) - CURRENT LAW Appropriations Act, 2010 ....................................................................... * * = & © $7,252,000,000 Budget Estimate, 2011..................... ..................-------- ~~~~ 7,603,000,000 Increase in Appropriation............................................................................…..............…..... +351,000,000 Summary of Increases and Decreases - Current Law (On basis of appropriation) 2010 Program 2011 Item of Change Estimated Changes Estimated Grants to States for Supplemental Food and - Nutrition Services and Admin. Costs $7,073,150,000 $207,850,000; $7,281,000,000 Infrastructure 13,600,000 0. 13,600,000 Technical Assistance 400,000 () 400,000 Breastfeeding Peer Counselors 80,000,000 3,000,000 83,000,000 Management Information Systems 60,000,000 0. 60,000,000 Program Evaluation & Monitoring 15,000,000 0. 15,000,000 Federal Admin. Oversight & Infrastructure 9,850,000 150,000 10,000,000 Coordination with Other Pograms 0 5,000,000 5,000,000 Breastfeeding Performance Bonus 1/ 5,000,000 5,000,000 10,000,000 WIC Contingency 0 125,000,000; 125,000,000 Adjusted Appropriation 7,257,000,000 346,000,000 7,603,000,000 Breastfeeding Bonus -5,000,000 5,000,000| () Total Appropriation 7,252,000,000 351,000,000; 7,603,000,000 1/ The $5 million for Breastfeeding Performance Bonus was provided in Section 749(i) of the Agriculture. Rural Development, Food and Drug Administration, and Related Agencies Appropriations Act, 2010. Funds for this activity in FY 2011 are requested as part of the WIC appropriation. 688 30-35 PROJECT STATEMENT (On basis of appropriation) Project 2009 Actual 20TU- Estimated. Increase or Decrease 20; } Estimated Grants to States for Supplemental Food and Nutrition Services and Admin. Costs $6,706, 150,000 $7,073,150,000 $207,850,000 $7,281,000,000 Infrastructure Grants 13,600,000 13,600,000 0 13,600,000 Technical Assistance 400,000 400,000 () 400,000 Breastfeeding Peer Counselors 14,850,000 80,000,000 3,000,000 (2) 83,000,000 Management information Systems () 60,000,000 0 60,000,000 Program Evaluation & Monitoring {} 15,000,000 0 $5,000,000 Federal Admin. Oversight O 9,850,000 150,000; (3) 10,000,000 Coordination with Other Programs 0 {) 5,000,000; (4) 5,000,000 Breastfeeding Performance Bonus 0 5,000,000 5,000,000 (5) 10,000,000; WIC Contingency 125,000,000 {) 125,000,000; (6) 125,000,000 ARRA, P.L. 111-5 WłC Contingency 400,000,000 0 () 0 WIC M3S 100,000,000 {} 0 0 Subtotal, ARRA 500,000,000 0 0 {} Total Adjusted Appropriation 7,360,000,000 7,257,000,000; 22 346,000,000 7,603,000,000; 22 Funds -500,000,000 {} 0 {} Breastfeeding Bonus {} -5,000,000 5,000,000 (5) 0. Total Appropriation 6,860,000,000T 7,252,000,000; 22 351,000,000 7,603,000.000; 22 689 30-36 PROJECT STATEMENT (On basis of available funds) 2009 2030 increase or | 20; } ,, . Project Actual Estimated SY Pecrease Estimated SY Grants to States for Supplemental Food $5,099,296,351 $5,591,785,000 $130,341,000 $5,722,126,000 Nutrition Services and Admin. Costs 1,832,994, 174; 1,970,509,000 $68,0} 1,000 2, 138,520,000 Infrastructure Grants 8,089,594 13,600,000 () 13,600,000 Technica; Assistance 385,478 400,000 0. 400,000 reastfeeding Peer Counselors 14,940,717 80,000,000; 3,000,000. 83,000,000 Management Information Systems {} 60,000,000 {} 60,000,000; Program Evaluation & Monitoring 0. 15,000,000 {} 15,000,000 Federal Admin. Oversight {} 9,850,000 150,000 10,000,000 Coordination with Other Programs {} - 0 5,000,000 5,000,000 reastfeeding Performance Bonus {} 5,000,000 5,000,000 10,000,000 ARRA Contingency 38,175,022 {}} ol {} ARRA WłC MIS 34,187,312 65,813,000 -65,813,000 0 Total Obligations 7,028,068,648; 7,8] 1,957,000 245,689,000 8,057,646,000 Recovery of Prior Year Obligations: - * WIC Program - -208,102,103 -480,698,000; -98,948,000 -579,646,000 WIC Contingency {} {} 0 0 WIC ARRA Contingency {}} {} {} {}} Unobligated Balances: - Available Start of Year WiC Program -21,050,174 -8,446,000 8,446,000 {} WłC Contingency {} - $25,000,000 . 0. -125,000,000 WłC ARRA MIS {} -65,813,000 65,813,000 {} WłC ARRA Contingency {} -361,825,000 36],825,000 {} Available End of Year WJC Program 8,445,963 {} - {} {} WIC Contingency 125,000,000 $25,000,000 125,000,000; . 250,000,000 WIC ARRA MiS 65,832,688 {) {} {} WIC ARRA Contingency 361,824,978 {} {} {} ARRA WIC Contingency Lapse 0 361,825,000 -364,825,000 fotai Adjusted Appropriation 7,360,000,000 7,257,000,000 22 ARRAWIcFunds 350,000.000ſ–DI- {} reastfeeding Promotion Bonus - - 0. -5,000,000 - 5,000,000 {} fotal Appropriation 6,860,000,000; 7,252,000,000; 22 351,000,000 7,603 000,000 22 690 30-37 Justification of Increases and Decreases The FY 2011 request for the Special Supplemental Nutrition Program for Women, Infants and Children (WIC) reflects an increase of $351,000,000. (l) (2) (3) (4) (5) (6) An increase of $207,850,000 for WIC Grants to States ($7,073,150,000 available in FY 2010). Explanation of Change. The WIC Program will have an expected increase in program costs that will b offset by a larger than expected carryover balance from FY 2010, which will be used to support 10 million program participates. As a result, the WIC Program is expected to be able to fully serve all participants in FY 2011 with the resources requested. The average monthly food cost per person is estimated to increase from $43.98 in FY 2010 to $45.59 in FY 2011. The average administrative cost per person is estimated to increase from $17.29 in FY 2010 to $17.72 in FY 2011. In addition, the funding provided supports a $2 increase in the cash value voucher for fruits and vegetables for children. An increase of $3,000,000 for Breastfeeding Peer Counselors ($80,000,000 available in FY2010). Explanation of Change. This change will be used to support and expand breastfeeding peer counselor programs. The use of breastfeeding peer counselors has proven to be an effective method of increasin breastfeeding duration. An increase of $150,000 for Federal Administrative Oversight ($9,850,000 available in FY 2010). This change will be used to improve the application process. An increase of $5,000,000 for Coordination with Other Programs, This funding supports efforts to improve the coordination with other programs as well as modernizatio of Federal Information Technology Infrastructure. An increase of $10,000,000 for Breastfeeding Performance Bonus. Explanation of Change. In FY 2011, $10,000,000 is requested as part of the WIC base appropriation. The funds will provide an increased level for performance bonuses to WIC State agencies for exemplary breastfeeding promotion and support practices at their local agencies and clinics. State agencies that achieve high or improved measurements of breastfeeding infant participation will be recognized. In FY 2010, $5,000,000 was provided for Breastfeeding Performance Bonuses under Section 749(i)(4)(A) of the Agriculture, Rural Development, Food and Drug Administration, and Related Agencies Appropriations Act, 2010 (general provision), not included in the base appropriation An increase of $125,000,000 for the WIC Contingency Fund. Explanation of Change. This funding increase is intended to Support participation in the latter half of FY 2011, if needed. 691 30-38 Program Cost and Performance Summary 2009 2010 ‘50Ti Program Performance Data Actual Budget Change Estimated Frogram Expenditures ($ in miſſions) Grants to States for Supplemental Food $4,618.6 $5,012.1 $489.9 $5,502.0 ARRA Contingency Food 38.2 0.0 0.0 {}_{} Nutrition Services and Administrative Costs 1,833.0 1,970.5 168.0 2,138.5 ARRA Contingency Admin 0.0 0.0 {}.0 0.0 Program Evaluation and Monitoring 0.0 | 5.0 0.0 1 5.0 Infrastructure Grants 8.1 H 3.6 0.0 }3.6 Technical Assistance 0.4 0.4 0.0 0.4 Breastfeeding Peer Counselors $4.9 80.0 3.0 83.0 Management hformation Systems 0.0 60.8 0.0 60.0 Fed. Admin. Oversight {}_{} 9.9 0.1 } 0.0 Coordination with Other Programs 0.0 Ö.0 5.0 S.0 Breastfeeding Performance Bonus 0.0 5.0 5.0 j 0.0 ARRA WIC MIS 34.2 65.8 -65.8 0.0 Total Program Expense aſ 6,547.4 7,232.3 605.2 7,837.5 Structural Carryover 480.7 579.6 -359.5 220.1 Total Obligations - 7,028.] 7,81 I.9 245.7 8,057.6 Average Participation Per Month (in millions) 9.1 9 9.498 0.559 } 0.057 Average Food Cost Per Person Per Month $42.55 $43.98 $1.6] $45,59 Average Admin. Cost Per Person Per Month H6.75 17.29 0.43 | 7.72 Total Benefit Costs 59.30 61.27 2.04 63.3} aſ Based on projected program level. 692 30–39 Food and Nutrition Service * GEOGRAPHIC BREAKDOWN OF OBLIGATIONS AND STAFF-YEARS - 2009 and Estimated 2010 and 2011 FY 20 ! {} FY 20) , }} Totals may not due to rounding. 693 30–40 FOOD AND NUTRITION SERVICE WIC Program Classification by Objects 2009 Actual and Estimated 2010 and 2011 (in thousands of dollars) Personnel Compensation: Washington D.C. Field 2009 2011 $882 1,035 1 I Total personnel compensation 1,917 Personnel benefits Benefits for former personnel 356 Total personnel compensation and benefits 2,273 f 2 22 23.1 23.2 23.3 24 25 25.1 25.2 25.3 25.4 25.5 25.6 25.7 25.8 2 3 32 4 4 4 4 9 : . Other Objects: Travel and transportation of persons Transportation of things Rental payments to GSA Rental payments to others Communications, utilities, and misc. charges Printing and reproduction Other Services Contractual Services Performed by Other Federal Agencies Related Expenditures Repair, Alteration or Maintenance of Equipment, Furniture or Structures Contractual Services - Other Agreements ADP Services and Supplies Miscellaneous Services Fees Supplies and materials Equipment Land and structures Grants, subsidies and contributions Insurance claims and indemnities Interest and dividends Special Payments Undistributed {} $7,028,069 2,065 565 7,806,957 128 2,098 8,052,571 Total other objects 7,028,069 7,809,715 8,055,373 Total direct obligations 7,028,069 7,811,957 8,057,646 Totals in FY 2009 and FY 2010 include ARRA Funds. 694 30–4] FOOD AND NUTRITION SERVICE SPECIAL SUPPLEMENTAL NUTRITION PROGRAM FOR WOMEN, INFANTS AND CHILDREN (WIC) 2009 SUMMARY OF RECOVERY ACT FUNDING Program/Project/Activity 2010 201 || WIC MIS $100,000,000 0 0 WIC Contingency 400,000,000 {} 0 Total Appropriation 500,000,000 {} {} PROJECT STATEMENT (On basis of available funds) 2009 2010 bncrease or 20; } Actual Estimated I}ecrease Estimated WJC MIS $34,187,312 $65,812,688 $-65,812,688 - 0 WIC Contingency 38,175,022 {} 0 O Total Obligation 72,362,334 65,812,688 -65,812,688 0 Unobligated Balance Start of Year 0. –427,637,666 427,367,666 {} Unobligated Balance End of Year 427,637,666 {} {) {} Lapse () 361,824,978 -36i,824,978 0 Total ARRA Appropriation 500,000,000 O Ö O WIC Management Information Systems - Program implementation Activities: Goals and Coordination Efforts: . Upgrade WIC systems through the transfer of State Agency Model (SAM) systems. Advance the use of WIC electronic benefits transfer (EBT) systems in the WIC Program. Modernize WIC systems through technology enhancements. Provide technical assistance to State agencies as needed. • Conduct annual users group meetings for SAM and EBT to identify and resolve implementation issues. • Provide networking opportunities through Federal/State/local technology conferences. Objectives: • Replace aging systems using the WIC Functional Requirements Document (FRed) as a guide for . in EBT planning activities, system design and development. Promote and fund, to the extent possible, SAM and SAM transfers. Require new MIS to support functionality needed to implement EBT. Promote the use of technical standards and common business practices. Support current EBT projects through statewide implementation and involve additional State agencies 695 30–42 Delivery Schedule: • Each project will have a timeline for completion. The performance period will vary depending on type of project funded. - - FY 2009.Accomplishments: Of the $100 million available for technology, just over $34 million was awarded to 13 State agencies for existing technology projects. - FY 2010 Płanned Activities: The funds to States are being awarded through a competitive grant process. These funds will be used to modernize and upgrade WIC systems through technology enhancements and through the transfer of state-of- the-art, model WIC systems. In addition, funds will be used to advance the goal of WIC EBT * implementation nationwide. FNS will provide technical assistance to State agencies as needed, conduct and facilitate users group meetings for the SAM systems and EBT to identify and resolve implementation issues. FNS will provide networking opportunities through Federal/State/local technology conferences. - Technology goals will be accomplished by 1) replacing aging systems using the WIC FReL) as a guide for system design and development; 2) promotion and funding for SAM and SAM transfers; 3) requiring that new MIS systems support functionality needed to implement EBT; 4) requiring that systems be developed using technical standards and common business practices; and 5) continued support for current EBT projects through Statewide implementation and involvement of additional State agencies in EBT planning activities. Approximately $1 million will be used for administrative purposes in FY 2010. - WIC contingency Funds. Program implementation Activities: Goals and common Efforts: • To support participation should costs or punicipation exceed budget estimates. Objectives: - • To serve all eligible persons seeking WIC services. Delivery Schedule: • Quarterly allocations, as needed. Performance Measures: • Average monthly WIC participation. FY 2009 Accomplishments: - The ARRA provided the WIC Program with $400 million to support WIC participation should cost OT participation exceed budget estimates. Of this amount, FNS allocated just over $38 million in April 2009 to 14 WIC State agencies to cover food costs. - FY 2010 Planned Activities: There are currently no plans to obligate the remaining WICARRA Contingency funds. 696 30–43 ARRA WIC Grants FY 2009 FY 2010 State Contingency MIS Total Contingency MIS Total Alabama {) 0 {) 0. $218,513 $218,513 Alaska () 0 {} 0. 2,487,150 2,487, 150 Arizona {) 0 0 0. 2,952,662 2,952,662 Arkansas 0. $400,433 $400,433 0. 0 0. California 0 - 0 0 () 3,706,515 3,706,515 Colorado 0 1,022,022 1,022,022 0. 444,066 444,066 Connecticut $1,362,164 () 1,362,164 0. 391,270 391,270 Delaware {} 0. 0. () 5,250,000 5,250,000 District of Columbia 370,164 0 370,164 {} 582,421 | 582,421 Florida () {} {} 0 3,874,445 3,874,445 Georgia 6,745,880 {} 6,745,880 0. 0 {} Hawaii 0 0 0. 0 250,000 250,000 jdaho {} 0 {} } 0 2,556,978 2,556,978 Hlinois 421,431 0 421,431 0 6,127,567 6,127,567 Kansas {} 0. {} 0 3,784,300 3,784,300 Kentucky 0 2,582,070 2,582,070 0 0 O Louisiana 1,638,740 0. 1,638,740 0. 576,302 576,302 Maine 0. 1,484,356 1,484,356 0 0 {) Maryland 2,669,550 0. 2,669,550 0 {} {} Massachusetts () {} {} 0 909,000 909,000 Minnesota 1,348,995 () 1,348,995 0 2,935,346 2,935,346 Mississippi 3,286,846 0. 3,286,846 0 0. 0 Missouri O 1,630,769 1,630,769 0 300,000 300,000 Montana {} 426,000 426,000 0 294,999 294,999 N. Carolina 0 17,276,448 17,276,448 0 {} 0. Nebraska 0. 0. 0. 0. 182,700 182,700 Nevada {} 1,500,000 1,500,000 0 0 0 New Jersey 1,673,810 O 1,673,810 0 1,349,414 },349,414 New Mexico 546,044 1,045,000 1,591,044 O 1,861,490 1,861,490 New York 5,468,978 0 | 5,468,978 0 8,224,337 8,224,337 North Dakota () {) 0 0. 68,975 68,975 Oklahoma {} 4,406,430 4,406,430 0 {} 0 Oregon () {} 0 0 39),650 391,650 Pennsylvania {} () {} {} 1,248,431 1,218,431 Puerto Rico 10,482,184 0. 10,482,184 {) 421,250 421,250 Rhode Island {) 0 0 0 147,488 147,488 S. Carolina 1,322,291 0 1,322,291 0. O 0. South Dakota 0 0. {} 0 1,907,672 J,907,672 Tennessee {} 0. {} {} 481,720 481,720 Texas {} 950,000 950,000 {} 9,827,925 9,827,925 Utah () 0 {} 0 206,000 206,000 Vermont 0 0. {) () 410,215 410,215 Virginia . () 585,822 585,822 0 0 {} Washington 837,945 0. 837,945 0 {) 0 Wisconsin {} 122,438 122,438 () 401,800 401,800 Wyoming 0. 644,035 644,035 () 0. 0. Undistributed - 111,489 1 11,489 1,070,087 1,070,087 Total 38,175,022 || 34,187,312 || 72,362,334 0 65,812,688 65,812,688 697 30g-26 SPECIAL SUPPLEMENTAL NUTRITION PROGRAM FOR WOMEN, INFANTS AND CHILDREN (WIC) STATUS OF PROGRAM Program Mission The Special Supplemental Nutrition Program for Women, Infants and Children (WIC) provides nutritious supplemental foods, nutrition cducation, and health care referrals at no cost to low-income pregnant, - postpartum, and breast-feeding women, to infants, and to children up to their fifth birthday, who are determined by health professionals to be at nutritional risk. “Low-income” is defined as at or below 185 percent of poverty. For the period of July 1, 2009, to June 30, 2010, this represents $40,793 for a family of four. WIC also promotes breastfeeding as the feeding method of choice for infants, provides drug abuse education, promotes immunization, and other aspects of healthy living. FNS makes funds available to participating State health agencies and ITOs that in turn distribute the funds to participating local agencies. State and local agencies use WIC funds to pay the costs of specified supplemental foods provided to WIC participants and to pay specified nutrition services and administration (NSA) costs, including the cost of nutrition assessments, blood tests for anemia, nutrition education, breastfeeding promotion, and health care referrals. Facts in Brief Selected Characteristics of WIC Participants Note: The 2006 WIC Participant and Program Characteristics Report was the first to contain data on race and ethnicity applying the new data collection procedures required by the Office of Management and Budget (OMB). Because the 2006 race/ethnicity categories differ significantly from previous reports, explicit comparison across years is not possible. e ºf April April April April April April WIC Participants . : 2002 ; : 2008 Infants 25.5% 26.3% 25.7% 25.7% 25.9% 25.5% Children 51.2% 49.6% 50.1% 49.8% 48.9% 49.5% Women 23.3% 24.1% 24.1% 24.5% 25.1% 25.0% Under 18 Years Old 9.1% 8.0% 6.8% 6.3% 6.2% 6.1% Breastfeeding 4.8% 5.3% 5.7% 6.0% 6.7% 6.9% Black 22.9% 21.9% 20.2% 20.0% 19.6% 19.6% Hispanic 32.3% 35.3% 38.1% 39.2% 41.2% 42, #9% White . 39.2% 37.4% 35.9% 34.8% 55.3% 60.3% On SNAP (Food Stamps) 26.6% 19,6% 17.5% 19.8% 21.8% 22.6% On Medicaid 48.3% 49.5% S4.3% 61.1% 63.2% 62.0% On TANF 17.0% 12.1% 9.6% 9.4% 9.3% 5.5% Poverty Status: ." 0-50% 28.1% 26.5% 26.5% 28.6% 29.3% 29.6% 5 i -i Q0% 28.7% 29.1% 27.4% 28.6% 30.5% 31.2% 101-130% 12.5% 13.7% ! 3.4% 13.1% 13.4% 13.4% 131-1 50% 6.1% 7.1% 6.7% 6.2% 6.4% 6.1% H51-185% 6.6% 8.4% 8.2% 7.7% 7.6% T.4% Mean Income (whole $) $12,479 $13,819 $14,550 $14,758 $15,577 $16,535 Mean Household Size (persons) 3.9 4.0 4.0 4.0 4.0 4.1 One Person Households 2.1% 1.8% 1.5% 1.3% 1.3% 1.2% Enrollment in 1*Trimester 46.6% 47.7% 48.4% 50.7% 51.2% 50.6% Enrollment in 2"Trimester 37.8% 39.0% 39.8% 38.4% 37.9% 37.4% Source: WIC Participant and Program Characteristics reports 1998-2008 698 30g-27 Program Participation and Costs tºº." Participation. 2004 2005 2006 2007 2008 2009 Women 1,931.7 1,966.2 2,023.3 2,093.3 2,153.2 2,181.8 lnfants 2,015.2 2,047.1 2,076.2 2,165.6 2,222.5 2,223,3 Children ‘5 3,957.5 4,009.2 3,988.5 4,026.4 4,328.8 4,714.3 Total 7,904.4 8,022.6 8,088.0 8,285.2 8,704.5 9,119.4 Change from Prior Year - 3.6% }.5% 0.8% 2.4% 5.1% 4.8% Food Cost Total (Million $) - $3,562 $3,603 $3,598 $3,880 $4,534 $4,657 Avg./Person/Month $37,54 $37,42 $37,08 $39.03 $43,44 $42.55 Change in Per Person Food Cost . 6.6% -0.3% -0.9% 5.3% ! 1.2% -0.3% Per Person Per Month Total (Food/Admin.) Cost $50,99 $51.30 $51.52 $53.91 $58.8l $59,30 Source: Program Information Report, September 2008. Actual totals may be received in future reporting periods. Reauthorization of the WIC Program In anticipation of the reauthorization of the WIC Program in 2009, FNS held a series of listening sessions around the country to help clarify the needs and concerns of program cooperators, participants, and partners at the State and local levels. FNS also published a Federal Register notice to solicit comments from individuals who were not able to attend the listening session. All of the programs authorized under the Chil Nutrition Act, including WIC, were extended for one year (until September 30, 2010), through a provision i the Agriculture, Rural Development, Food and Drug Administration and Related Agencies Act for 2010 (Public Law 111–80). Nutrition Education: An Important Benefit Nutrition education is integral to the success of the WIC Program and is an important part of the WIC benefit package. The statute requires that 1/6" of the amounts States spend for nutrition service and education must go for nutrition education and breastfeeding promotion. Nutrition education is conducted through individual or group sessions and through the provision of materials designed to achieve a positive change in dietary and physical activity habits and improve health status. Participants are also counseled on the importance of WIC foods in preventing and overcoming specific risk conditions identified during certification activities. Special emphasis is given to appropriate infant feeding and to breastfeeding support. and promotion. In FY 2009, FNS published a revised Infant Nutrition and Feeding Guide, which is the reference handbook for WIC and Commodity Supplemental Food Program staff who provide nutrition education to parents and caretakers of infants. Program regulations require States to offer at least two nutrition education contacts for each participant during each certification period, and to promote breastfeeding to all pregnant women unless contraindicated. FNS is working in cooperation with the Food and Nutrition Information Center, which is located at the National Agricultural Library, to expand availability of nutrition services tools for WIC State and local agency staff through the WIC Works Resource System, located on the USDA Web site at - http://www.nal.usda.gov/wicworks. Features of the WIC Works Resource System include: (1) WIC-Talk, an online discussion forum; (2) WIC Sharing Center, where State-developed materials can be downloaded; (3) WIC Learning Center, where WIC staff can improve their nutrition services skills; (4) WIC databases for educational materials and information about WIC formulas; and (5) WIC Learning Online, a Web-based course for staff development and continuing education. The WIC Works Resource System received over 3.6 million hits in FY 2009. Breastfeeding Promotion Efforts The WIC Program promotes breastfeeding as the best form of nutrition for infants through the provision of support and encouragement to new mothers and through nutrition education during pregnancy. In addition, to encourage breastfeeding, WIC mothers who decide to breastfeed receive a more substantial food package 699 30g-28 nd are eligible to receive WIC for a longer period of time than non-breastfeeding postpartum women. The umber of participating postpartum women determines the minimum amount of WICNSA funding, States re required to dedicate toward breastfeeding promotion and support. In FY 2003, FNS began the evelopment of “Using Loving Support to Implement Best Practices in Peer Counseling,” a project esigned to prepare staff within the WIC Program to implement and expand breastfeeding peer counseling rograms. This project serves as a guide for local programs in designing, building and sustaining peer ounseling programs. The goal of the project is to equip WIC Programs with the tools necessary to mplement and manage a research-based peer counseling model that is effective and feasible. n FY 2008, State agencies spent $116.5 million for breastfeeding promotion and support. During Y 2009, $14.9 million was allocated among all WIC State agencies to continue States' implementation of n effective and comprehensive peer counseling program and/or to expand an existing program. State gencies are now implementing plans that institutionalize peer counseling as a core service in WIC. For Y 2010, the allocation for State agencies to build upon and expand breastfeeding peer counseling efforts as increased to $80 million. In addition, FNS developed the competency-based breastfeeding training curriculum, “Using Loving Support to Grow and Glow in WIC: Breastfeeding Training for Local WIC Staff” and provided training in a “train-the-trainer” format for key WIC State agency staff in each FNS region in FY 2009. The project ensures all local agency WIC staff are equipped with the necessary skills to successfully promote and support breastfeeding among WIC participants. - FNS continues to partner with other member organizations to sponsor the bi-annual meetings of the Breastfeeding Promotion Consortium (BPC). The mission of the BPC is to be a forum for the Federal Government and breastfeeding advocacy groups to promote, protect and support breastfeeding. The BPC comprises over 30 organizations, including professional and public health associations, government agencies and breastfeeding advocacy groups. Meetings are held in conjunction with the meetings of the United States Breastfeeding Committee, which FNS attends as the government liaison. IC Food Package n December 6, 2007, the Department published an interim final rule revising the WIC food packages. he revisions align the WIC food packages with the 2005 Dietary Guidelines for Americans and infant eeding practice guidelines of the American Academy of Pediatrics. State agencies were required to implement the provisions contained in the interim rule no later than October 1, 2009. Only one State gency failed to meet this deadline and has been placed under a corrective action plan requiring implementation by December 1, 2009. The interim final rule comment period ends on February 1, 2010 and USDA will issue a final rule after review and analysis of public comments, FNS provided extensive guidance and technical assistance to assist WIC State agencies in implementing the new WIC food packages. FNS provided training for WIC staff at FNS Regional Office meetings, and worked with the National WIC Association to train staff during conferences and national State-wide conference calls. FNS developed frequently asked questions to assist State agencies throughout the implementation period, and created guidance and conducted trainings related to new breastfeeding provisions of the interim rule, - Cost Containment Initiatives In an effort to use food grants more efficiently, all geographic WIC State agencies and most ITOs have implemented cost containment strategies, including competitive bidding, rebates, least cost brands and use of economically-priced package sizes. Savings generated by such actions are used by State agencies and ITOs to provide benefits to more participants within the same total budget. Due to the success of cost saving measures, average per person WIC food costs have grown much more slowly than general food inflation over the last 19 years. The average monthly food cost has increased by approximately 45 percent since FY 1990, while general food inflation, as measured by the TFP, has increased by 74 percent. 700 30g-29 The most successful strategy has been competitively bid infant formula rebate contracts between State agencies and infant formula manufacturers. In addition, 20 State agencies, including State agencies that are parties in four multi-State contracts, have rebate contracts for infant foods (juice, cereal, vegetable, fruit, and meat). In FY 2009, State-reported rebate savings was $1.9 billion. Approximately sixty percent (29) of the geographic State agencies (excluding Mississippi and Vermont) received a 90 to 95 percent discount on the wholesale cost of infant formula. Most of the remaining geographic State agencies (16) received discounts ranging from 82 to 89 percent and three received discounts ranging from 70 to 79 percent. Four geographic State agencies implemented contracts for FY 2009 with discounts ranging from 85 to 91 percent, with a median discount of 91 percent. To date, six geographic State agencies awarded contracts for FY 2010 with discounts ranging from 90 to 93 percent with a median discount of 91.5 percent. FNS continues to closely monitor infant formula rebates. The Child Nutrition and WIC Reauthorization Act of 2004 (P.L. 108-265) required State agencies to establish cost containment systems to ensure that the WIC Program pays competitive prices for WIC foods. The law also contains provisions regarding vendors that derive more than 50 percent of their annual food sales from WIC redemptions, and further requires that State agencies ensure that use of such vendors does not result in higher food costs than if participants used regular vendors (average payments to above-50- percent vendors cannot be higher than average payments to regular vendors). FNS published an interim final rule on November 29, 2005, implementing the new provisions. By law, State agencies were required to implement the rule provisions by December 30, 2005. FNS published a final rule to complete the implementation of these provisions of the law on October 8, 2009 (74 FR 51745). FNS continued to provide training and technical assistance to assist States in implementing their vendor cost containment systems throughout FY 2009. State Agency Model (SAM) Project The SAM Project is an initiative to develop model WIC MIS through multiple State agency consortia. It also includes the transfer of these models to other WIC State agencies in order to eliminate systems development duplication and streamline the MIS procurement process. The SAM Project is consistent with FNS’ five-year technology plan to improve WIC system functionality through the replacement of automated legacy systems. FY 2009 was the sixth year in which FNS awarded grant funds to the three consortia. The consortia are: Successful Partners in Reaching Innovative Technology (SPIRIT), comprised of 13 ITOs in New Mexico and Oklahoma; the Mountain Plains State Consortia, comprised of three State agencies (Colorado, Wyoming and Utah); and Crossroads, comprised of four State agencies in the Mid-Atlantic and Southeast regions (Virginia, West Virginia, North Carolina and Alabama). Development of the first model system, SPIRIT, was completed in FY 2007 and enhanced in FY 2008 and FY 2009. With the completion of the SPIRIT model, FNS provided funding to the first transfer State agencies in FY 2007 (Arkansas, Missouri and Montana) and one additional State agency (Maine) in FY 2008. In FY 2009, two additional State agencies (Alaska and Minnesota) received funding to transfer the SPIRIT system. Electronic Benefit Transfer (EBT) Upgrading WIC management information systems (MIS) is a priority for the WIC Program. State-of-the- art, robust systems are needed to support EBT implementation. To achieve this, FNS is supporting the development of State Agency Model (SAM) systems and the transfer of those systems to State agencies in need of a new MIS. The implementation of SAM system provides the technology infrastructure needed to support EBT. Concurrently, FNS is promoting EBT in State agencies that can support it, with the goal of nationwide EBT implementation. In FY 2009, $100 million in Recovery Act funds were appropriated to the WIC program, of that amount, approximately $34 million was awarded to 41 State agencies for WIC SAM and EBT projects as well as for other technology improvements. 701 30g-30 EBT systems hold the potential to enhance benefit delivery and improve accountability of food benefits and vendor payment systems, FNS is working with, and providing funds to, individual State agencies on initiatives to plan, develop and implement WIC EBT systems. Since FY 1995, FNS has provided approximately $50 million in for EBT project development. To date, five WIC State agencies (Wyoming; Texas; New Mexico; Isleta, NM; and Cherokee, OK) have successfully implemented EBT projects using smartcard technology. These State agencies are operating EBT systems Statewide or, in the case of Isleta and Cherokee, throughout the jurisdiction of the tribal organization. In addition to the smartcard pilot projects, FNS continues to support online technology, which has proven successful in the WIC Program. The Michigan and Nevada WIC Programs have successfully implemented EBT using magnetic stripe cards with existing retailer equipment in an online real time capacity and now operate EBT Statewide. Two other State WIC Programs (Kentucky and Chickasaw Nation) are developing on-line systems as well. Data collected from these projects will be evaluated to help determine the future of WIC EBT technologies. - In FY 2009, FNS awarded Recovery Act funds to nine States (Alabama, Colorado, Delaware, the District of Columbia, Illinois, Missouri, Montana, Oregon, and Pennsylvania) to conduct EBT planning activities. In addition, Wisconsin received funds to augment planning activities that began in FY 2008, Virginia also received funds for their EBT initiative, which has evolved into a joint planning project with West Virginia. Fourteen State agencies have been funded to date for EBT planning purposes. Value Enhanced Nutrition Assessment (VENA) In 1999, FNS contracted with the IOM Food and Nutrition Board to review the assessment of dietary risk, The VENA initiative is a response to the resulting IOM Report, Dietary Risk Assessment in the WIC Program, published in 2002, which determined that traditional dietary assessment protocols do not identify nutritional inadequacies for individuals with sufficient precision to target enhanced services. VENA Policy and Guidance (developed with the assistance of a joint workgroup of FNS and National WIC Association representatives) was sent to all WIC State agencies in February 2006 to assist State agencies in implementing VENA by the target date of FY 2010. The Guidance identifies nutrition assessment staff competencies and methods to enhance the delivery of individualized nutrition education and counseling. As of FY 2010, all WIC State agencies have implemented VENA. State agencies will provide ongoing training to local agency staffs to ensure compliance with VENA. In addition, online training modules related to VENA competencies are available through the WIC Learning Online System and the WIC Works Resource System; these modules can be accessed directly by State and local WIC agency staff at their own convenience, as needed. RECOVERY ACT FUNDING In FY 2009, the WIC Program received a total of $500 million in American Recovery and Reinvestment Act (ARRA) funds. Of this amount, $400 million was provided to support WIC participation, and approximately $100 million was provided to establish, improve, or administer WIC management information systems to include changes necessary to meet new legislative or regulatory requirements. WIC Management Information Systems. Of the $100 million available for technology, just over $34 million was awarded to 13 State agencies for existing technology projects. Approximately $1 million will be used for administrative purposes in FY 2010. The remaining funds, approximately $65 million, will be awarded in the first quarter of FY 2010, The funds to States are being awarded through a competitive grant process. These funds will be used to modernize and upgrade WIC systems through technology enhancements and through the transfer of state-of-the-art, model WIC systems. In addition, funds will be used to advance the goal of WIC EBT implementation nationwide. FNS will provide technical assistance to State agencies as needed, conduct and facilitate users group meetings for the SAM systems and EBT to identify and resolve implementation issues. FNS will provide networking opportunities through Federal/State/local technology conferences. Technology goals will be accomplished by 1) replacing aging systems using the WIC Functional Requirements Document (FReB) as a guide for system design and development; 2) promotion 702 30g-31 and funding for SAM and SAM transfers; 3) requiring that new MIS systems support functionality needed to implement EBT; 4) requiring that systems be developed using technical standards and common business practices; and 5) continued support for current EBT projects through statewide implementation and involvement of additional State agencies in EBT planning activities. MIC Contingency Funds: The ARRA provided the WIC Program with $400 million to support WIC participation should costs or participation exceed budget estimates. Of this amount, FNS allocated $38 million in April 2009 to 14 WIC State agencies to cover food costs. WIC Special Project Grants-Revitalizing Quality Nutrition Services in the wic Program In FY 2009, FNS provided grant awards to States as part of FNS’ Revitalizing Quality. Nutrition Services in WIC (RQNS) initiative, whose goal is to improve and strengthen the effectiveness of WIC nutrition services. In FY 2009, FNS awarded a full grant to the State agenies of Vermont and Washington, and a concept paper development grant to the State agency of Washington. The $586,000 grant awarded to Vermont focuses on developing, implementing, and evaluating innovative strategies to use the new breastfeeding food packages to increase breastfeeding rates among WIC participants. Washington’s $479,000 grant will use the new WIC fruit and vegetable benefit to establish sustainable partnerships with local food systems groups and bring new resources and innovative ideas to WIC nutrition services. Washington was also awarded a grant of $20,000 for one year to identify barriers to services, best practices, and culturally appropriate service models to improve WIC participation and health outcomes for eligible Native American tribal members. State Award Full Grants - Vermont W $479 WIC Studies and Evaluations The following study reports were released by FNS in FY 2009 and may be found on the FNS Web site at http://www.fms.usda.gov/ora. . Dynamics of WIC Program Participation. By Infants and Children 2001 to 2003 – April 2009: This report provides information on the participation patterns of infants and children who were enrolled in WIC from FY 2001 through FY 2003. Information on the dynamics of WIC participation leads to a better understanding of overall trends in the WIC caseload and the factors that affect participation. WIC Eligibles and Coverage - 1994 to 2007: Estimates of the Population of Women, Infants, and Children Eligible for WIC Benefits – September 2009: This report offers updated estimates of the population that met these criteria and was eligible for WIC benefits in each of the years 1994 through 2007. The estimates are based on a methodology developed in 2003 by the Committee on National Statistics of the National Research Council, refined for this report, to better reflect actual breastfeeding practice and reported cessation among postpartum women. - 703 30g-32 SPECIAL SUPPLEMENTAL NUTRITON PROGRAM (WKC) PARTICPATION AND PROGRAM FINANCING FISCAL YEAR 2009 STATE OR |Meriana rust (excluding Tribe Set Associated 14 kncludes indian Agencies. 2f Excludes $385,478 for WłC technical assistance, $8,089,594 for WRC infrastructure grants, $14,940,717 for Breastfeeding Peer Counselors, and $34,187,312 in ARRA funds for MS. Totals may not add due to rounding. NOTE: These data are based in part on preliminary data submitted by State and local agencies and are subject to change as revised reports are received. Totals may not add due to rounding. 704 30-44 FOOD ANDNUTRITION SERVICE The estimates include appropriation language for this item as follows (new language underscored; deleted matter enclosed in brackets): Supplemental Nutntion Assistance Program: For necessary expenses to carry out the Food and Nutrition Act of 2008 (7 U.S.C. 2011 et seq.), [$58,278,181,000; $68,206,790,000, of which [$3,000,000,000] $5,000,000,000, to remain available through September 30, 2011} 2012, shall be placed in reserve for use only in such amounts and at such times as may become necessary to carry out program operations: Provided, That funds provided herein shall be expended in accordance with section 16 of the Food and Nutrition Act of 2008: Provided further, That this appropriation shall be subject to any work registration or workfare requirements as may be required by law: Provided further, That funds made available for Employment and Training under this heading shall remain available until expended, notwithstanding section 16(h)(1) of the Food and Nutrition Act of 2008: Provided further, That funds made available under this heading may be used to enter into contracts and employ staff to conduct studies, evaluations, or to conduct activities related to program integrity provided that such activities are authorized by the Food and Nutrition Act of 2008. 1. For making after May 31 of the current fiscal year, benefit payments to individuals and payments to States of other non-Federal entities for the necessary current year expenses of carrying out the Food and Nutrition Act above the anticipated level, such sums as may be necessary. 2. [Sec. 1001. There are hereby appropriated such sums as may be necessary, for an additional amount for 'Food and Nutrition Service--Supplemental Nutrition Assistance Program" for necessary current year expenses to carry out the Food and Nutrition Act of 2008 (7 U.S.C. 2011 et seq.): Provided, That such amount shall be used only in such amounts and at such times as may become necessary to carry out program operations: Provided further, That amounts so appropriated are designated as emergency requirements and necessary to meet emergency needs pursuant to sections 403 and 423(b) of S. Con. Res. 13 (111th Congress), the concurrent resolution on the budget for fiscal year 2010.] [Sec. 1002. (a) In General.--For the costs of State administrative expenses associated with administering the supplemental nutrition assistance program established under the Food and Nutrition Act of 2008 (7 U.S.C. 2011 et seq.), there are hereby appropriated $400,000,000, which shall remain available until September 30, 2011.] - [(b) Allocation of Funds.--Funds described in subsection (a) shall be made available as grants to State agencies as follows--j - - {(1) 75 percent of the amounts available shall be allocated to States based on the share of each State of households that participate in the supplemental nutrition assistance program as reported to the Department of Agriculture for the most recent 12-month period for which data are available, adjusted by the Secretary (as of the date of enactment) for participation in disaster programs under section 5(h) of the Food and Nutrition Act of 2008 (7 U.S.C. 2014(h));) [(2) 25 percent of the amounts available shall be allocated to States based on the increase in the number of households that participate in the supplemental nutrition assistance program as reported to the Department of Agriculture over the most recent 12-month period for which data are available, adjusted by the Secretary (as of the date of enactment) for participation in disaster programs under section 5(h) of the Food and Nutrition Act of 2008 (7 U.S.C. 2014(h)); and {(3) Not later than 60 days after the date of enactment of this Act, the Secretary shall make available to States amounts based on paragraphs (1) and (2) of this subparagraph.] [(c) Reallocation of Funds.--Funds unobligated at the State level in fiscal year 2010 may be recovered and reallocated to the States in fiscal year 2011.] - {(d) Emergency Designation.--Amounts in this section are designated as emergency requirements and necessary to meet emergency needs pursuant to sections 403 and 423(b) of S. Con. Res. 13 (1 11th Congress), the concurrent resolution on the budget for fiscal year 2010.] The first change provides indefinite funding authority for carrying out the Food and Nutrition Act above the anticipated level of program benefits and other non-Federal expenses. The second change deletes unnecessary language from the Department of Defense Appropriations Act, 2010 (P.L. 1 1 1-1 18) that is superseded by the language added in the first change. 705 Appropriations Act, 2010 aſ 30–45 Budget Estimate, 2011 aſ Increase in Appropriation Adjustments in 2010: Appropriations Act, 2010 FOOD AND NUTRITION SERVICE LEAD-OFF TABULAR STATEMENT AND SUMMARY OF INCREASES AND DECREASES * * * * * * * * * * * * * * ~ * * * * * * * * * * * * * * * * * * * * * * * * * * * * DOD Supplemental Adjusted base for 2010 Budget Estimate, Current Law, 2011 * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * r * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * SUPPLEMENTAL, NUTRITION ASSISTANCE PROGRAM (SNAP) - CURRENT LAW * * * * * * * * - - • * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * v- a w - a v e s e º 'º - - $58,278,181,000 +400,000,000 * - - - - * * * * * * * * * * - - - - - s - a s e < * * - - - - - - - a tº a 4 + - - - - - - - - - * * * * lncrease over adjusted 2010 Budget Estimate, Current Law, 2011 al., Change due to proposed legislation Net Request, President's 2011 Budget Request • * * * * * * * * * * * * * * * * * * * * * * * * * * * * * • a e -- - - - - - - - e s s p * * * - - - - - - • * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * Summary of Increases and Decreases - Current Law (On basis of adjusted appropriation) SUPPLEMENTAL, NUTRITIONASSISTANCE PROGRAM (SNAP)- PROPOSED LEGISLATION a/ Excludes $10,459,789,000 in FY 2010 and $11,935,785,000 in FY 2011 provided by the ARRA. 20 {} Pay Program 2011 Item of Change Estimated Costs. Changes Estimated Benefit Costs $49,623,934,000 0 $7,570,377,000 $57,194,311,000 ARRA -- Benefits 10,054,551,000 {} 1,615,476,000 } 1,670,027,000 Contingency Reserve 3,000,000,000 {} 2,000,000,000 5,000,000,000 Administrative Costs: State Administrative Costs 3,043,000,000 {} 34},000,000 3,384,000,000 State Administrative Costs 60% 400,000,000 {} -400,000,000 0. ARRA -- Administrative Costs 150,000,000 {} - 150,000,000 {} Employment and Training 380,902,000 {} 7,044,000 387,946,000 Other Program Costs 94,036,000 $}69,000 24,778,000 } | 8,983,000 Total Administrative Costs 4,067,938,000 169,000 -] 77,178,000 3,890,929,000 Nutrition Assistance for Puerto Rico 1,746,351,000 0 -10,478,000 1,735,873,000 ARRA -- NAP 254,217,000 {} 10,478,000 264,695,000 Food Distribution Program on Indian Reservations 112,797,000 {} -2,739,000 } 10,058,000 TEFAP Commodities 248,000.000 {} - 1,500,000 246,500,000 American Samoa 7,013,000 {} -42,000 6.97 j.000 ARRA -- American Samoa Benefits },021,000 {} 42,000 1,063,000 Commonwealth of the Northern Mariana Islands 12,148,000 {} {} | 2, 148,000 Community Food Project 5,000,000 () () 5,000,000 Program Access 5,000,000 {} {} 5,000 000 Total Adjusted Appropriation 69,137,970,000 169,000 | 1,004,436,000 80,142,575,000 SAE 100% DOD Supplemental -400,000,000 {} 400,000,000 0. ARRA Funding -10,459,789,000 {} -],475,996,000 - 1,935,785,000 Total Appropriation 58,278,181,000 169,000 9,928,440,000 68,206,790,000 $58,278,181,000 68,206,790,000 +9,928,609,000 $58,678,181,000 ...... 68,206,790,000 $68,206,790,000 462,000,000 706 30-46 PROJECT STATEMENT (On basis of adjusted appropriation) 2009 20 tº increase or ARRA – Benefits - - 1 1,670,027 Costs - Costs 100% ARRA -- Administrative Costs and Training: - Federal Funds 100% l l Federal Funds 50% 195,037 - 205,31 Program Costs: Benefit & Retailer Redemption and Monitoring Certification of SSI for SNAP Payment Accuracy and Cooperative Services Retailer integrity and Trafficking Computer Support Electronic Benefit Transfer Systems Nutrition Education and Program information Program Evaluation and Modernization Assistance for Puerto Rico Distribution Program on Indian Reservations: USDA Foods in lieu of SNAP Distributing Agencies Expenses and Nut, Ed. Commodities Samoa ARRA -- American Samoa Benefits of the Northern Mariana islands Food Project Nutrition Pilot Projects SAE 100% DOD Supplemental note: Excludes $1,000,000 in permanent appropriated no year funds for FY 2009 for a study on comparable access to supplemental nutrition assistance benefits in Puerto Rico. Funding provided by Section 4142 the Food, Conservation, and Energy Act of 2008, P.L. 10-246. 1/ Of this amount, $426 million is provided through a government-wide initiative funded by a general government fund. 707 Project ARRA ... Benefits Costs Costs 100% ARRA -. Administrative Costs and Training Frgerzh Funds 100% Federal Funds 50% Participant Costs 50% Benefit & Retailey Redenºption and Monitoring Certific abom of SS Recipients for SNAP Payment Accuracy and Cooperative Services Retailey integrity and Trafficking Computer Support Electronic Benefit Transſer Systerns Nutrition Education and Program information Program Evaluation and Modernization Increase Scnior Parncipation ARRA -- 8tnefits NAP Og USDA Foods in licu of SNAP Distributung Agencies Expenses and Nul Ed ARRA -. Equipment Samoa ARRA ... American Samoa Benefits oriumonwealth of the Northern Mariana islands onmounty Food Project and Nutrition Pilot Projects AccCS$ Baiance Start of Year Unobligated Balance Suart of Ycat B2}ance £nd of Year Unobligated Balance End of Year Lapsing Balance Lapsing to CNP Employment & Training Funds 24 olicctions from E&T 60% obligations ollections from Reimbursable Trapsfer Community Food Project ARRA Funds 30–47 PROJECT STATEMENT On basis of available Actus; SY Estimated SY 254,217 35,971,071 3,712, 3,063,132, 471,601, 471,601 3,706,079 1,289,42) Estirnsted i 670,027 } 205.3 i ! 28,951 -j,317, 169 1,289,421 708 30-48 Note: Excludes $1,000,000 in permanent appropriated no year funds for FY 2009 for a study on comparable access to supplemental nutrition assistance benefits in Puerto Rico. Funding provided by Section 4142 the Food, Conservation, and Energy Act of 2008, P.L. 1 }{}-246. }/ Up to 10 percent of the funding provided for The Emergency Food Assistance Program (TEFAP) for the procurement of commodities is permitted to be used for TEFAP administrative costs. 2/ Appropriated Employment & Training funds are adjusted in FY 2010 to reflect a rescission of $11,000,000 in unobligated funding pursuant to Title VII, Section 742 of P.L. I 11-80. 3/ Of this amount, $426 million is provided through a government-wide initiative funded by a general government fund. Justification of lncreases and Decreases The FY 2011 request for SNAP reflects an increase of $9,928,609,000. Justification does not include changes resulting from ARRA adjustments. (1) An increase of $7,570,377,000 for Benefit Costs ($49,623,934,000 available in FY 2010). Explanation of Change. In FY 2011, overall participation is estimated to increase to an average level of 43.26 million participants per month due to changes in unemployment and general economic conditions resulting from the recent recession. In addition to the increase in appropriations above, additional funding is being provided to maintain the maximum allotment at $668 per month for a four-person household as provided for in the ARRA. With this additional funding, the average benefits per person per month are estimated to be at about $132.76 in FY 2011. A comparison of key program performance and cost indicators for FY 2009 through 2011 is presented below: - Program Performance Cost Indicators - 2009 2010 2011 Program Performance Indicators. Estimate | Estimate i Estimate Average participation per month (000) 33,722 40,538 43,260 Average unemployment rate (percent) 8.4 10.1 9.5 Thrifty Food Plan (TFP) 1/ $583.40 || $580.10 $588.40 Maximum Allotment (4 person him) based on the TFP $583.00 || $580.00 $588.00 Maximum Allotment (4 person h) – beginning April 1, 2009 $668.00 $668.00 $668 00 Overall average benefit per person per month including 13.6 percent ARRA increase above the TFP (P.L. 1.11-5) $124.45 || $132.93 || $132.76 If TFP estimates for FY 2010 and FY 2011 are based on the economic assumptions provided by OMB for the 2011 President's Budget. Because SNAP statute and regulations require complex individual and household calculations to determine eligibility and benefit levels, erroneous or false information can result in the overpayment or underpayment of benefits. Some households may intentionally or inadvertently misreport their circumstances that affect eligibility and benefits (e.g., income, resources, household composition); other households may fail to report changes in their circumstances. Eligibility workers may fail to act promptly on reported changes, may fail to correctly apply Federal policies, and may make arithmetic errors, FNS works with States to keep all of these errors to a minimum. FNS activities include sponsoring National, regional, and State conferences; providing direct technical assistance to individual States; and facilitating the exchange of effective payment accuracy strategies among States. The actual total error rate for FY 2008 decreased to 5.01 from a level of 5.64 in FY 2007. Previous to FY 2007, the rate fell each year since FY 1998, when the rate was 10.69 percent. A comparison of reported overpayment/underpayment error rates for FY 2007 and FY 2008 and estimated erroneous benefits through FY 2011 follows: 709 30–49 2007 2008 2009 2010 201 * Actual Actual Target Target Target Amount of Overpayments ($ millions) $1,389 $1,871 $2,012 $2,586 $2,757 Overpayment Error Rate (percent) 4.58 4.0] 4.0 4.0. 4.0 Amount of Underpayments ($ millions) $321 $456 $503 $647 $689 Underpayment Error Rate (percent) j.06 1.00 } {} J.0 }, {} Total Benefits Over/Under Issued in Error ($ $1,710 $2,327 $2,515 $3,233 $3,446 millions) Total Error Rate (percent) 1/ 5.64 5.01 5.0 5.0 5.0 Amount of Combined Errors Offset ($ millions) $1,068 $1,415 || $1,509 $1,940 $2,068 1/ These targets may be adjusted in consideration of program growth, state budget constraints, and other related factors. (2) An increase of $341,000,000 for State Administrative Expenses (SAE) ($3,043,000,000 available in FY 2010). Explanation of Change. The FY 2011 estimate of $3,384,000,000 for SAE is based on estimated State. obligations of $3.295 billion in FY 2010. FY 2010 State obligations are estimated by multiplying a historical obligation rate by total SAE budgets requested by states for FY 2010. The offset for SNAP obligations, which is funded from Temporary Assistance for Needy Families (TANF) and mandated in the Agriculture Research Act, is added and new performance bonus payments are deducted. The resulting FY 2010 base of $3.444 billion is inflated by the State and local purchase deflator through FY 2011, the TANF offset is deducted and the estimated new performance bonus payments are added to estimate the SAE in FY 2011. (3) An increase of $7,044,000 for Employment and Training ($380,902,000 available in FY 2010). Explanation of Change. The estimated increase is based on the following items: In FY 2011 50 percent State administrative costs increase to $205,311,000, due to inflation ($200,108,000 available in FY 2010). The 50 percent participants’ dependent care and transportation costs increase to - $72,635,000 in FY 2011 due to inflation ($70,794,000 available in FY 2010). The total estimated need for these two activities is $277,946,000. (4) An increase of $24,947,000 for other program costs as shown below ($94,036,000 available in FY 2010.) Other FY 2010 Estimate FY 2011 Total The overall increase consists of the following: Mandatory: Costs (a) Benefit & Retailer Redemption and Monitoring: Explanation of Change. The increase consists of the following: • An inflationary adjustment resulted in an increase of $155,000, • An increase of $9,400,000 to maintain benefit and retailer redemption and monitoring. This increase will support the non-discretionary transition of the critical Account Management Agent (AMA), which supports the transaction of all SNAP benefits, from an antiquated mainframe 710 30-50 environment to a client/server infrastructure. This will improve system reliability and security and will support modernization of the ALERT fraud detection system ($19,396,000 available in FY 2010). For more information, please refer to page 30-52. (b) Certification of Supplemental Security income (SSI) Recipients for SNAP: Explanation of Change. An increase of $3,299,000 adjusts for the significant increase in the average SNAP participants since FY 2009. These funds are used for certifying SSI recipients for supplemental nutrition assistance and utilizing Social Security Administration (SSA) data to ensure accurate SNAP benefit determinations ($10,686,000 available in FY 2010). Discretionary: (c) An increase of $12,093,000 for Discretionary Other Program Costs ($63,954,000 available in FY 2010). - - - - Explanation of Change. The increase consists of the following: - • An increase of $169,000 for salaries and benefit pay cost. An increase of $4,000,000 in funding to provide point of sale terminals to all Farmers’ Markets nationally that are not currently participating in SNAP to assist in the redemption of SNAP benefits. For more information, please refer to page 30-53. • An increase of $6,000,000 for Healthy incentives Pilot (HIP). For more information, please refer to page 30-54. - - • An increase of $12,500,000 for Community networks to encourage healthy eating. For more information, please refer to page 30-55. • A decrease of 10,576,000 for Seniors Participation. In FY 2010, funding was provided to test innovative strategies to reduce participation barriers among seniors by using Social Security Administration (SSA) data. ~ Other Costs Related Other and Services Retailer and T Electronic Benefit Transfer Nutrition Education and linformation Evaluation and Modernization lmcrease Seniors as Total } 69 } (5) A decrease of $10,478,000 for Nutrition Assistance for Puerto Rico ($1,746,351,000 available in FY 2010). Explanation of Change. The Farm Security and Rural Investment Act of 2002 (P.L. 107-171), provides for an inflationary adjustment for Nutrition Assistance for Puerto Rico based on the percent change in the TFP. In addition to the decrease in the appropriation above, additional funding is being provided to maintain a level of funding that is 13.6 percent above the June 2008 TFP as provided for in the ARRA. (6) A decrease of $2,739,000 for Food Distribution Program for Indian Reservations (FDPIR) ($112,797,000 available in FY 2010). Explanation of Change. The decrease consists of the following: • A decrease of $2,960,000 in funding for procurement of commodities resulting from a higher FY 2011 beginning commodity inventory level when compared to 2010 and an increase in the cost of commodities in FY 2011 ($75,878,000 available for procurement of USDA foods in FY 2010); and 711 7) 8 ) 30-5 i • An increase of $221,000 for inflation in administrative expenses for ITOs ($36,919,000 available for distributing agency expenses in FY 2010). FOOD DiSTRIBUTION PROGRAM ON INDIAN RESERVATIONS 2009 2010 2011 Program Performance Data Actual Estimate Difference Estimate Resources ($000): - Appropriation if $114,914 $112,797 -$2,739 $110,058 Beginning inventory (Federal and Local) 13,594 29,590 2,788 32,378 Total Resources 128,508 142,387 49, 142,436 Program Demand: - Average Monthly Participation 95,369 100,137 {} 100,137 Average Monthly Food Packages: FNS Purchased $54.54 $6042 $0.48 $60.90 Free Substitute 2.85 1.50 0.0 i 1.51 Total Monthly Food Package 57.39 61.92 {}.49 62.41 Demand: ($000) FDPIR USDA Food Costs 2/ 62,417 72,603 577 73,180 USDA Foods Purchases Admin. 483 487 4 49 } Special Purchase of Bison 0. {} 0 {} Demand, USDA Foods 62,900 73,090 581 73,671 State Administration 35,971 36,919 22 | 37,140|| Total Demand 98,871 1 10,009 802 | 10,811 Use of Resources: Program Demand 98,871 i 10,009 802 } 10,81 Inventory Change 15,995 2,788 -3,541 -753 Lapsed Funds 48 {} 0. {} Total Funds Available 114,914 112,797 -2,739 | 10,058 Balance End of Year: Ending inventory 29,590 32,378 –753 31,625 Purchases 78,895 75,878 -2,960 72,918 l/ FY 2009 excludes $5 million provided by the Recovery Act for equipment. 2f lnventory costs include additional storage and transportation costs for USDA foods moving from Federal inventories. A decrease of $1,500,000 for The Emergency Food Assistance Program (TEFAP) ($248,000,000 available in FY 2010). Explanation of Change. The Food, Conservation, and Energy Act of 2008 (P.L. 10246), provides for changes in the amount of funding available for the procurement of USDA foods to be distributed through TEFAP, based on the percent change in the TFP. Up to 10 percent of the total available is permitted to be used for TEFAP administrative costs. A decrease of $42,000 for American Samoa ($7,013,000 available in FY 2010). Explanation of Change. The Food, Conservation, and Energy Act of 2008 (P.L. 110-246), provides for changes in the amount of funding available for the supplemental nutrition assistance grant program in American Samoa based on the percent change in the TFP. In addition to the appropriation above, additional funding is being provided to maintain a level of funding that is 13.6 percent above the June 2008 TFP as provided for in the ARRA. 712 Program: Proposal: Rationale: 30-52 FNCS PRESIDENT's BUDGET FiscAL YEAR 2011 CURRENT LAW Supplemental Nutrition Assistance Program — Account Management Agent (AMA) Migration FNS requests funding to migrate AMA from mainframe platform to upgraded platform and support modernization of the ALERT fraud detection system AMA was developed and is maintained by the Federal Reserve Bank (FRB) Richmond at the request of FNS as a front-end for the United States Treasury's Automated Standard Application for Payments (ASAP) system. AMA's purpose is to manage the ASAP SNAP accounts for FNS in support of its EBT process which utilizes electronic debit cards to deliver SNAP benefits. The debit cards carry a SNAP benefits balance reduced by the amount of purchases when a transaction is conducted at the food retailer. The retailer is subsequently reimbursed by the state's EBT processor. AMA was implemented in 1996 as a mainframe application with only two State project accounts. The application was converted into a Web application in 2005 and now services 54 State project accounts. In 2009, AMA processed approximately $50.4 billion in SNAP issuances. ASAP provides the source from which the State EBT processor obtains the funds to reimburse retailers. AMA provides the means by which the processor enters SNAP obligations (AMA issuances) to fund the ASAP account (ASAP authorizations) from which the processor obtains the disbursements (ASAP payments). AMA is critical to EBT operations. AMA mainframe databases, shared with ASAP, reside in the Federal Reserve Information Technology (FRIT) environment at CC1 Federal Reserve East Rutherford Operations Center (EROC). AMA updates the shared databases with account and issuance/authorization transactions. AMA also accesses ASAP payment data in the shared databases for reporting and reconciliation purposes. A study performed by FRIT concluded that the mainframe was no longer viable and costs for support will increase significantly if applications remain on the mainframe due to fewer applications sharing the costs. Additional risks include a lack of resources, subject matter experts who are knowledgeable of the mainframe environment, and software products and languages used by AMA to keep the mainframe in operation over the long term. Treasury is planning to move ASAP to another platform in 2011. The ASAP migration of the mainframe will require AMA's interface with ASAP to be redesigned. Without migrating AMA to the upgraded ASAP platform, there is a significant risk that AMA will not run with the new platform, leaving AMA's functionality vulnerable, since ASAP and AMA share some of the same data tables. In addition, Treasury Web Application Goal: Budget Impact: ($ in millions) Infrastructure may no longer support non-treasury applications. Consequently, AMA will eventually need to move its front-end processing to a new platform anyway to ensure the SNAP issuance process is not interrupted. If migrated later, it will likely be at a greater COSł. - USDA Strategic Goal: Ensure that all of America's children have access to safe, nutritious, and balanced meals. FY 2011 Mandatory Budget Authority $9.4 713 Program: Proposal: Rationale: 30-53 FNCS PRESIDENT'S BUDGET FISCAL YEAR 2011 CURRENT LAw Supplemental Nutrition Assistance Program — 100 Percent Funding for Farmers' Market Electronic Benefit Transfer (EBT) Terminals FNS requests funding to provide point of sale terminals to all Farmers’ Markets nationally that are not currently participating in SNAP There are approximately 4,700 farmers’ markets operating across the Nation. At the end of 2008 only 753 markets were authorized to accept SNAP benefits. Of those, approximately 715 were performing electronic transactions. The rest participated by using manual vouchers exclusively. We estimate that 3,985 markets do not have electronic equipment. It is an FNS priority to ensure that SNAP participants have access to the healthy foods offered at farmers’ markets. Increasing access at farmers’ markets will not only promote healthy eating practices, but will support the local farmer within the surrounding community. A variety of reasons why farmers' markets do not participate in SNAP exist, but by far, the primary reason involves cost of the equipment. Per law, all authorized SNAP retailers must be afforded the opportunity to participate in the EBT system at no cost. While standard EBT Goal: Budget Impact: ($ in millions) equipment, which requires access to electricity and a phone line, is available at no cost to retailers, there is no requirement that States must provide wireless devices free of charge. Unfortunately, most farmers’ markets do not have access to phones or electricity at the market location and most State agencies cannot afford to provide wireless terminals to farmers’ markets. Current regulations provide these vendors with manual vouchers. However, this process is cumbersome and risky if the retailer is unable to call for voucher authorization at the time of purchase. Accomplishing this priority will require additional funding to equip markets with EBT technology. - - FNS has determined that the most efficient way to equip markets for SNAP is to provide one wireless terminal per market, which can be used to purchase tokens that can be accepted by any market vendor for SNAP-eligible items. These terminals would also be able to accept credit and debit cards. In order to equip all markets to handle SNAP transactions, at least 3,373 additional terminals would be needed. USDA Strategic Goal: Ensure that all of America's children have access to safe, nutritious, and balanced meals. FY 2011 Budget Authority $4.0 714 Program: Proposal: Rationale: Goal: Budget Impact: ($ in millions) 30-54 FNCS PRESIDENT'S BUDGET FISCAL YEAR 2011 CURRENT LAW Supplemental Nutrition Assistance Program Enhanced Healthy Incentives Pilot (HIP) Test FNS is preparing to implement and evaluate a pilot project, authorized and funded at $20 million by the 2008 Farm Bill, to test the impact of a financial reward triggered by the purchase of fruits and vegetables on the overall amount of those foods consumed by SNAP households. Under the pilot, buying targeted fruit or vegetable products using SNAP benefits will result in participants earning additional purchasing power, which will be added to the participants SNAP benefit amount. For example, if a HIP participant uses SNAP benefits to purchase $10 of target fruits and vegetables, that participant will earn an incentive payment of $3. Whereas the test of a financial incentive is the question posed by the authorizing legislation, some have argued that incentives alone may not have the desired effect unless accompanied by a program of nutrition education and promotion. The proposed funding would allow the agency to add a group of SNAP participants in the pilot community that receive both the financial incentive and nutrition education and compare their dietary intakes to those of persons receiving just the incentive. This additional information and analysis would show whether or not adding education to the incentive has a greater impact than the incentive alone. Solicitations for a pilot demonstration site and for the project evaluation were released in December 2009. FNS will competitively select the pilot demonstration site by August 2010. This will be followed by the planning, testing and training phase in preparation for the 15 month full-scale operation of the pilot from December 2011 through February 2013. USDA Strategic Goal: Ensure that all of America's children have access to safe, nutritious, and balanced meals. - - - - FY 2011 Budget Authority $6.0 715 Program: Proposal: Rationale: Goal: Budget Impact: ($ in millions) 30-55 FNCS PRESIDENT'S BUDGET FISCAL YEAR 2011 CURRENT LAW Supplemental Nutrition Assistance Program Community Networks to Encourage Healthy Eating This pilot project, authorized but not funded by the 2008 Farm Bill, will test the impact of a community-wide approach that targets large numbers through multiple means of communication and influence to raise the general awareness of healthy eating, shift social norms, create more opportunities to make healthy food choices, and reward such choices when made. It offers a potentially effective alternative to strategies that offer occasional health messages delivered through select communication channels. In an environment where calorie dense foods are widely available and promoted with substantial advertising budgets, changing food choices through these more limited strategies offer a relatively modest chance for success. The proposed test will assess the cost-effectiveness of incorporating multiple spheres of influence involving local policy, institutional (e.g., School, retailer) practices, community communications and interpersonal education to change eating behavior among SNAP participants. This project will be implemented through competitively awarded grants to one or more State SNAP agencies and their local community partners, along with an independent evaluation contract. USDA Strategic Goal: Ensure that all of America's children have access to safe, nutritious, and balanced meals. FY 2011 Budget Authority $12.5 716 30-56 FOOD AND NUTRITION SERVICE Summary of Increases and Decreases - Proposed Legislation (On basis of appropriation) Fiscal Year 2011 Current Program Budget Item of Change Law Change Request Benefits $57,194,311,000; $462,000,000 $57,656,311,000 Contingency Reserve 5,000,000,000 {} 5,000,000,000 Administrative Costs: State Administrative Costs 3,384,000,000 {} 3,384,000,000 Employment and Training 387,946,000 {) 387,946,000 Other Program Costs 118,983,000 {} 118,983,000 Subtota), Administrative Costs 3,890,929,000 0 3,890,929,000 Nutrition Assistance for Puerto Rico 1,735,873,000 {} 1,735,873,000 Food Distribution Program on Indian Reservations 110,058,000 {} 110,058,000 TEFAP Commodities 246,500,000 O 246,500,000 American Samoa 6,971,000 0 6,971,000 Commonwealth of the Northern Mariana Islands 12,148,000 {} 12,148,000 Community Food Project 5,000,000 {} 5,000,000 Program Access 5,000,000 0 5,000,000 Total Available 68,206,790,000 462,000,000; 68,668,790,000 Explanation of Proposed Legislation: The increase consists of the following: º An increase of $25 million in FY 2011 to extend the ARRA provision that eliminates the time limits for Able-Bodied Adults without Dependents (ABAWDs) for an additional fiscal year. ARRA reversed section 6(o) of the Food and Nutrition Act of 2008, which restricts ABAWDs from receiving SNAP benefits for more than 3 months every 3 years. The ARRA provisions on ABAWDs are set to expire at the end of Fiscal Year 2010. For more information, please refer to page 30-57. © An increase of $91,000,000 over 10 years to exclude refundable tax credits from countable income and assets in the month of receipt and for the following 12 months beginning tax year 2009 for both applicants and beneficiaries. SNAP currently excludes EITC from income eligibility and benefit determination. This policy is part of a broader initiative to exchade all refundable tax credits from income and assets across all federally funded means-tested programs. For more information, please refer to page 30-58. © An increase of $9,393,000,000 over 10 years to increase the asset limit to $10,000 in SNAP. In general, SNAP levels are currently set at $3,000 for households with elderly or disabled members; $2,000 for households without elderly or disabled members. This policy is part of a broader initiative to establish a common asset limit across all federally funded programs for certain populations. For more information, please refer to page 30-59. 717 Program: Proposal: Rationale: Goal: Budget Impact: ($ in millions) 30.57 FNCS PRESIDENT'S BUDGET FISCAL YEAR 2011 PROPOSED LEGISLATION Supplemental Nutrition Assistance Program (SNAP) FNS proposes to extend the ARRA provision that eliminates the time limits for Able-Bodied Adults without Dependents (ABAWDs) for an additional fiscal year. ARRA reversed section 6(o) of the Food and Nutrition Act of 2008, which restricts ABAWDs from receiving SNAP benefits for more than 3 months every 3 years. The ARRA provisions on ABAWDs are set to expire at the end of FY 2010. Extending ARRA's ABAWD provision would improve ABAWDs’ access to nutritious food because they will not be subject to time restraints. The extension would also improve the administration of the program by reducing waiver workload. With high levels of unemployment, large areas of the country would qualify for geographic ABAWD waivers. Reinstating ABAWD policy would require the States to apply for waivers, and FNS to . approve those waivers, using valuable resources that are best used on administering the program during this time of caseload growth. Since FNS expects many States to qualify for geographic ABAWD waivers, extending ARRA's ABAWD provision will not significantly change the implementation of the program. States would continue to have the ability to disqualify ABAWDs from SNAP if they fail to comply with an Employment and Training Program. * USDA Strategic Goal: Ensure that all of America's children have access to safe, nutritious, and balanced meals. FY 2011 Mandatory Budget Authority TS250 718 30-58 FNCS PRESIDENT’S BUDGET FISCAL YEAR 2011 PROPOSED LEGISLATION Program: Supplemental Nutrition Assistance Program (SNAP) Proposal: Exclude all refundable tax credits in the month of receipt and for the following 12 months beginning in tax year 2009 for all federally funded means-tested programs. Rationale: This proposal, which directly impacts SNAP, will exclude lump sum tax credits, including the Eamed Income, Child, American Opportunity, and Make Work Pay, for 12 months following the month of receipt. This policy will prevent beneficiaries from experiencing a disruption in eligibility and benefits in the wake of new and refundable tax credits. It also simplifies administration of the program by creating a common rule for refundable tax credits. Goal: USDA Strategic Goal: Ensure that all of America's children have access to safe, nutritious, and balanced meals. - Budget Impact: ($ in millions) FY 2011 Mandatory Budget Authority $11.0 719 Program: Proposal: Rationale: Goal: Budget Impact ($ in millions): 30-59 FNCS PRESIDENT*S BUDGET FISCAL YEAR 2011 PROPOSED LEGISLATION Supplemental Nutrition Assistance Program (SNAP) Establish a national asset limit floor of $10,000. Current asset rules across a variety of programs are antiquated, inconsistent, and present obstacles for low-income individuals who aspire to achieve self-sufficiency. This proposal establishes a national asset limit floor across human services, food, and cash assistance programs for working-age individuals and families. For certain programs that serve beneficiaries other than working populations, such as SNAP, the asset limit floor will apply to all program beneficiaries. - As a government-wide policy, this will apply to all federally funded means-tested programs, regardless of whether benefits are administered at the State or Federal level. The goal is to streamline eligibility, decrease confusion for families receiving benefits from multiple programs, and allow families to save toward self-sufficiency. USDA Strategic Goal: Ensure that all of America's children have access to safe, nutritious, and balanced meals. FY 2011 Mandatory Budget Authori $426.0 720 30-60 Food and Nutrition Service GEOGRAPHIC BREAKDOWN OF QBLIGATIONS AND STAFF-YEARS 2009 and Estimated 2010 and 2011 tº Eyºtº SSee 1/ Totals may not add due to rounding. 721 30-61 FOOD AND NUTRITHON SERVICE Supplemental Nutrition Assistance Program Classification by Objects 2009 Actual and Estimated 2010 and 2011 (in thousands of dollars) Personnel Compensation: 2009 2010 2011 Washington D.C. $4,612 $5,248 $5,311 Field 5,415 6,160 6,234 11|Total personnel compensation 10,027 11,408 11,545 12|Personnel benefits 1,989 2,262 2,294 13||Benefits for former personnel 0. 0 . O Total personnel compensation and benefits 12,016 13,670 13,839 Other Objects: - 21 Travel and transportation of persons 2,197 2,221 2,245 22|Transportation of things 1 S6 158 160 23.1|Rental payments to GSA 23.2|Rental payments to others 23.3|Communications, utilities, and misc. charges 2,227 2,251 2,276 24|Printing and reproduction 987 998 1,009 25 |Other Services • 42,741 43,21 1 43,686 25. Contractual Services Performed by Other Federal Agencies 25.2|Related Expenditures - 25.3|Repair, Alteration or Maintenance of Equipment, Furniture or Structures 25.4|Contractual Services - Other 25.5|Agreements 25.6|ADP Services and Supplies 25.7ivisceilaneous Services 25.8Fees * 26|Supplies and materials 315,509 299,499 295,193 31|Equipment 1,329 1,344 1,359; 32|Land and structures - 41|Grants, subsidies and contributions 55,827,673 71,036,181 74,842,308 42|Insurance claims and indemnities - 43|Interest and dividends 5 () y 0. 45|Special Payments 92|Undistributed i Total other objects 56,192,824 71,385,863 75,188,236 Total direct obligations 71,399,533 75,202,075 56,204,840 722 30-62 FOOD AND NUTRITION SERVICE Supplemental Nutrition Assistance Program SUMMARY OF RECOVERY ACT FUNDING . 2011 $1 1,670,027 of - 2010 Benefits $10,054,551 Administrative Costs Rico NAP Equipment Grants 254,217 264,695,000 Samoa Benefits } PROJECT STATEMENT (On basis of available funds) 2009 2010 Increase or 20| | Actual Estimated Decrease Estimated Snap Benefits $4,333,248,756 $10,524,862,000 $1,145,165,000 $41,670,027,000 Snap Administrative Costs 144,997,380. 150,000,000 -150,000,000 O Fuerto Rico NAP 240,133,000 254,2} 7,000 }{3,478,000 264,695,000 FDPIR Equipment Grants 3,742,435 1,288,000 -1,288,000 O American Samoa Benefits 964,000 1,025,000 42,000 1,063,000 Total Obligation 4,723,055,571 10,931,388,000 1,004,397,000 11,935,785,000 Unobligated Balance Start of Year {} -471,601,000 471,601,000 O Unobligated Balance End of Year 471,601,429 0 {} Qi. Balance Lapsing o 2,000 2006 - 0 Total Adjusted Appropriation 5,i 94.657,000 10,459,789,000 1,475,996,000 11,935,785,000 Total Available of Estimated rººf-ºf-Hº * * * * * * * * , Program implementation Activities: Goals and Coordination Efforts: tº Supplemental Nutrition Assistance Program (SNAP): O Utilize the economic multiplier effects of SNAP to stimulate the economy. Every $5 in new SNAP benefits generates a total of $9.20 in total economic activity. SNAP recipients will likely spend the . increased benefits quickly. Eighty percent of all benefits are redeemed within two weeks of receipt, and 97 percent are spent within a month. - - FNS is working closely with State partners to implement the provisions of the Recovery Act in a timely manner. All States issued increased benefits to recipients starting April 2009, FNS issued six sets of questions and answers to assist States with implementation of the law, FNS also participated in conference calls with States to brief them on the Recovery Act, share implementation information and answer questions. In addition, FNS sponsored a Webinar with over 200 participants ranging from States to national advocacy organizations to faith and neighborhood based organizations. The Webinar served to inform these groups about SNAP and . the Recovery Act and encourage them to act as messengers with their own stakeholders. FNS will monitor and oversee State partner program operations as they spend Recovery Act funds using an existing set of reporting and monitoring tools. This includes regular financial and program activity level reporting, management evaluations, program access reviews, and payment accuracy (quality control) reviews, - States will report on how they are spending ARRA SNAP SAE dollars using a separate form that mirrors the current data requirements (collected via form SF 269) but allows for tracking of the 723 30-63 recovery dollars specifically. Recovery Act funds make up approximately 5 percent of current State administrative expenses of the program. • Food Distribution Program for Indian Reservations (FDPIR) o FDPIR has experienced increased participation over the last year, and these funds reinvest in the facilities and equipment needed to operate FDPIR. In many cases, FDPIR caseloads have expanded due to recent economic conditions, and ITOs and State Agencies (SAs) often lack funds to make expensive capital investments in the warehouses and food distribution equipment needed to serve FDPIR recipients. Objectives: • SNAP: o Put Recovery Act benefit dollars into the wallets of needy people quickly and accurately. o Distribute SAE quickly to assist States to administer the program and deliver benefits to a growing number of low income people. • FDPHR: o FDPIR funds will be allocated to ITOs and SAs that administer FDPIR to ensure that the highest- priority needs are met. Delivery Schedule: • SNAP: o March 17, 2009 – Distributed FY 2009 SAE funding to States. o April 1, 2009 – SNAP recipients began to receive increased benefits each month as a result of ARRA. For example, a household of four will receive an increase of $80 per month. Time limits are lifted for able bodied adults without dependents, unless the State agency opts to offer a qualifying work opportunity. o October 2010 – Distributed FY 2010 SAE funding to States. Time limits for able bodied adults without dependents are reinstated. The clock restarts for all affected households. • FDPIR: o Most FDPIR funds were made available to ITOs and SAs in 2009 subject to receipt of an approved budget from the ITO or SA. FDPIRITOS/SAs that purchased equipment obligated funds relatively quickly, but those making facility upgrades are likely to require a longer obligation timeframe, stretching into FY 2010. Performance Measures: SNAP: e SNAP: o Every $5 in new SNAP benefits generates a total of $9.20 in total economic activity. Using FNS estimates of new benefits issued, the total stimulative effect of new benefits is calculated. 724 30-64 Target 2009 2010 204 | increase in SNAP Benefits $4.3 billion $10.5 billion $! i.7 billion Total Stimulative Effect $7.9 billion $19.3 billion $23.5 billion • FDPIR: o FDPIR programs that receive ARRA funds will be asked to report on their progress in completing equipment purchases or facility upgrades as a measure of ARRA achievement. 2 {} ! I 2009 2010 Percent of FDPIR Funds Obligated 74% 26% **** N A FY 2009 Accomplishments: The ARRA funds provided by SNAP increased SNAP participants' household income during the recession to help boost the economy. FNS quickly obligated $4.7 billion, 91 percent, of the $5.2 billion appropriated by ARRA during FY 2009. FNS expects the remaining unobligated amount to be obligated during FY 2010. Considering that the combined historical outlay rate for SNAP is 97 percent, and that a multiplier effect mentioned earlier exists, SNAP fulfilled its role in contributing to economic improvement in 2009. FY 2013/20] 2 Pianned Activities: FNS will continue to provide the supplemental ARRA benefits to SNAP participants. FNS plans to monitor the obligation and outlay of all ARRA funds in FY 2011 and 2012. 725 30g-33 SUPPLEMENTAL, NUTRITION ASSISTANCE PROGRAM STATUS OF PROGRAM Program Mission The Supplemental Nutrition Assistance Program (SNAP) works to raise nutrition levels of low-income households by ensuring access to a nutritious, healthful diet for households through nutrition assistance and utrition education. This access provides the opportunity for low-income recipients to consume a diet onsistent with the Dietary Guidelines for Americans. It enables low-income households to obtain a more utritious diet by issuing monthly allotments of benefits redeemable for food at retail stores. ligibility and allotment amounts are based on household size, income, and expenses; eligibility is also ased on assets, citizenship or legal immigration status, work requirements, and other factors. Benefits are djusted annually to reflect changes in the June cost of the Thrifty Food Plan (a market basket of foods that eet the recommendations of the Dietary Guidelines for Americans for a low-cost diet for a four-person eference family). The Federal Government pays the full cost of benefits and funds approximately half of he expenses incurred by the States to administer the program, The SNAP account also includes Nutrition Assistance for Puerto Rico (NAP), American Samoa and the Commonwealth of the Northern Mariana Islands, the Food Distribution Program on Indian Reservations (FDPIR), and the funding for USDA Foods used in The Emergency Food Assistance Program (TEFAP). Program Name Change Section 4101 of the Food Conservation and Energy Act of 2008 (P.L. 101-246, “Farm Bill”) changed the name of the Food Stamp Program to SNAP as of October 1, 2008. The new name reflects the changes made in the program to meet the needs of clients, including improved accessibility, a focus on nutrition and n increase in benefit amounts. hile SNAP is the Federal name for the program, States maintain the flexibility to name their own rograms. FNS is strongly encouraging States to change their program names to SNAP or another name of heir choice and not to maintain the Food Stamp Program name. FNS is tracking State name change ecisions. As of November 2009: - to FSP Current Alternate Name States 30: *Includes the 50 United States, District of Columbia, Guam and the U.S. Virgin Islands. ame change implementation continued with updates to forms, regulations, and publications. New informational materials are developed as needs arise. covery Act IMPLEMENTATION AND Funding n February 17, 2009, the ARRA was signed into law. ARRA included several provisions to stimulate he economy by increasing SNAP benefits, increasing administrative funding to States, and temporarily uspending the time limits for Able Bodied Adults without Dependents (ABAWDs). These changes rovide a direct economic stimulus. Every $5 in new SNAP benefits generates a total of $9.20 in total economic activity. SNAP recipients spend the benefits quickly. Eighty percent of all benefits are redeemed within two weeks of receipt, and 97 percent are spent within a month. A detailed list of ARRA SNAP provisions is included below. - - 726 30g-34 On April 1, 2009, SNAP recipients began to receive increased benefits each month as a result of ARRA. For example, a household of four received an increase of $80 per month. Time limits were also lified for ABAWDs, unless the State agency opted to offer a qualifying work opportunity. On March 17, 2009, FNS distributed $145 million in FY 2009 SNAP State Administrative Expense (SAE) funding to States. In October 2009, FNS distributed $150 million in FY 2010 SAE ARRA funds to States. These funds represent approximately five percent of current State administrative expenses of the program. States will report on how they are spending ARRA (SAE) dollars using a separate form that mirrors the current data requirements (collected via form SF 269) but allows for specific tracking of the recovery dollars. - - In order to assist States with successful implementation of ARRA provisions, FNS held a series of telephone conferences with its Regional Offices and State agencies to explain the new provisions and issued an implementation memorandum on February 23, 2009, to State agencies on relevant SNAP provisions. FNS also issued additional information in a question and answer format on specific questions raised by State agencies and made all written information available on the agency’s public Web site. Time limits for ABAWDs will be reinstated on October 1, 2010. The clock restarts for all affected households. SNAP-RELATED ARRA PROVISIONS IMPLEMENTED ON APRIL 1, 2009 ARRA Section Number and Provision Description 101(a) and (b). Maximum Benefit Increase Increases the maximum SNAP benefit by using 113.6 . percent of the June 2008 value of the Thrifty Food Plan. The minimum benefit for one and two person households is also adjusted. This new maximum benefit is a price floor and cannot be lowered once the provision ends on - September 30, 2009. - 101(a)(1). Consolidated Block Grant for Block grants in Puerto Rico and American Samoa will be Puerto Rico and American Samoa calculated using 1 13.6 percent of the June 2008 value of the TFP for fiscal year 2009. Future block grants cannot be reduced below this level, 101(b)(3). Maximum Benefit Increase — The QC variance exclusion for errors related to Quality Control (QC) - implementation of the adjusted benefits begins on April 1, 2009, and continues until October 1, 2010. - 101(b)(4). Requirements for the Secretary — Overissued benefits from the implementation of the ARRA . Client Overissuance Claims provisions are excluded when calculating the claim against a household until October 1, 2010. : 101(b)(5). Requirements for Secretary – The $25 tolerance level in 7 CFR 275.12(f)(2) shall be Quality Control - raised to $50 until October 1, 2010. - - 101(c). Administrative Expenses Within 60 days of enactment of ARRA, FNS will allocate $145 million in SAE funds across SNAP State agencies for fiscal year 2009. FNS will allocate $150 million across these agencies for fiscal year 2010. Seventy-five percent of the amount available for each fiscal year will be allocated based on the number of households participating in SNAP in each State. Twenty-five percent will be allocated based. on the increase in the number of households that participate in SNAP, Both of these calculations are based on the most recent 12 month period for which data are available. From the amounts above, FNS was allocated a total of $4.5 million for management and oversight activities. - 727 30g-35 101(e)(1). Treatment of Jobless Workers ABAWDs shall not be subject to time limits until October 1, 2010. ABAWDs must continue to comply with the requirements of an Employment and Training Program. States are not required to track ABAWDs, use exemptions or request waivers during this time 101(e)(1). Treatment of Jobless Workers— The QC variance exclusion for improperly disqualifying Quality Control ABAWDs because they receive 3 months of benefits in a - 36 month period will begin April 1, 2009, and continue through September 30, 2010. SNAP-RELATED ARRA provisions IMPLEMENTED SUBSEQUENT TO APRIL 1, 2009 ARRA Section Number and Provision Description 101(a)(1) and (2), Maximum Benefit The benefit levels for FY 2010 and subsequent years will Increases for FY 2010 and Subsequent Years be based on the greater of 113.6 percent of the value of the - TFP in June 2008 and the value of the TFP in June of 2009 and each subsequent year. 101(e)(2). Treatment of Jobless Workers On October 1, 2010, State agencies shall disregard any period during which an individual received SNAP benefits prior to October 1, 2010. ImplementationotsNApprovision othernºrarm bill On June 18, 2008, Congress enacted the 2008 Farm Bill, which amended and renamed the Food Stamp Act of 1977 as the Food and Nutrition Act of 2008 (FNA). In addition to the name change, the 2008 Farm Bill contains various provisions that affect program eligibility, benefit amounts, and program administration, including changes mandated by the law and those that provide greater flexibility for State agencies. A number of 2008 Farm Bill SNAP provisions were effective October 1, 2008, and all State agencies implemented these changes on that date. During FY 2009, FNS continued the process of developing proposed rulemakings to codify the 2008 Farm Bill provisions in program regulations. While some provisions were fully or partially implemented prior to final regulations, other provisions require regulations before implementation can be enforced. Facts in Brief Program Participation SNAP participation for FY 2009 averaged 33.7 million persons, representing an 18.7 percent increase from FY 2008. The majority of the increase reflects the impact of changing economic conditions, and Federal and State efforts to improve program access through policy and practice. - The following table displays data on benefit costs and participation for FYs 2003 through 2009: 2003 2004 2008 21.26 26.67 26,47 28.41 1.4 4 A $86.03. 72 .64 01.52 %. Of 7 8. 8.7 8.9 8.8 9.4 8.1 .7 7.2 6.9 8.8 Note: 2009 includes ARRA Participation Rates among Eligible People – The most recent figures on the rate of participation show that in 2007, 66 percent of all those who were eligible for SNAP participated in the program, as compared with 54 percent in 2002. In that same year, participants received over 80 percent of all benefits that would be issued if every eligible person participated, indicating that the program is effectively targeted to those most in need. - 728 30g-36 Characteristics of SNAP Recipients—The most recent survey of household characteristics, conducted during 2008, indicates that: 57.7 percent of all participants were children (under 18 years of age) or elderly (age 60 or older); The gross income of 87 percent of households was below the Federal poverty level; 41 percent of households were at or below 50 percent of poverty; - 16 percent of SNAP households had no income; and - The proportion of households with earnings remained close to the all-time high while the proportion of households with public assistance income reached an all-time low, : The following data describes SNAP recipients in terms of individuals and households: Characteristics of SNAP Recipients 2002 || 2003 2004 || 2005 ; 2006 || 2007 || 2008 Recipients: - - Average Number (in Millions) - 19.0 | 20.9 || 23.5 ſ 24.9 || 25.6 25.9 27.8 % Children 51.0 50.8 50.2 50.0 49.2 49.1 48.6 % Elderly - 8.9 8.5 8.2 8.2 8.7 8.7 9.1 % Registered for Work 9. 9 9 9 10 ! { 1 : Average Household Size 2.3 2.3 2.3 2.3 2.3 2.2 2.2 Households: Average Number (in Millions) 8.2 9.0 10.1 10.9 | 1.3 | 1.6 12.5 % Receiving Maximum Benefit 24 26 31 31 31 32 33 % Headed by Women 71 72 72 71 71 70 70 % Certified 12 Months or More 54 53 53 55 58 58 58 % With Earned Income - 28 28 29 29 30 30 29 % With AFDC/TANF 21 17 16 15 13 12 11 Average Gross Monthly Income $633 || $640 $643 $648 $673 || $691 $701 Average Net Monthly Income w $355 $348 $32; ; $319 $328 $330 $335 % With Zero Gross Income | 1 12 13 14 14 1 4 | 6 % With Zero Net Income 24 26 29 30 31 31 33 %With Gross Monthly Incomes Less than $400 28 29 30 30 29 28 29 % With No Countable Assets 69 70 69 70 70 70 73 % With Countable Assets of $1 to $500 22 21 22 22 21 21 20 Average Countable Assets $134 || $154 $143 $137 $137 $144 $126 *:º Assets in Households with $264 $347 $293 $279 || $258 $302 $238 % Below Poverty Level 88 88 |, 88 89 87 87 87 % Below 50% Poverty Level 36 38 40 | 40 39 39 41 Average Shelter Deduction - $131 $146 $178 $186 $203 $303 || $319 Average Shelter Expense $339 $366 $405 || $416 $458 $490 $507 % at Shelter Cap 9 10 13 14 15 16 16 Source: Supplemental Nutrition Assistance Program Quality Control Sample – Data may not match FY data from other sources. 729 30g-37 General Activities Regulations Issued in FY 2009 During FY 2009 two SNAP rulemaking actions were published in the Federa Register: • FSP: Revisions to Bonding Requirements for Violating Retail and Wholesale Food Concerns – This final rule, published December 30, 2008, revised the bonding requirements that are imposed against retailers and wholesalers that redeem SNAP benefits and have violated program rules. • SNAP Clarifications and Corrections to Recipient Claim Establishment and Collection Standards – This proposed rule, published April 2, 2009, corrects and clarifies provisions of the final rule on recipient claims published at 65 FR41752, July 6, 2000. - Grants to Improve Program Access and Eligibility Determination On September 9, 2009, FNS announced the awardees of the FY 2009 SNAP participation grants. These grants are targeted to State agencies, public health or educational entities, or private nonprofit entities. The latter includes: community or faith-based organizations, food banks, or other emergency feeding organizations. This year's grants focused on retention of eligible households in SNAP and supporting partnerships between SNAP and private non-profit organizations. For FY 2009, FNS awarded seven grants. • New Hampshire Department of Health and Human Services, in partnerships with Southern New Hampshire Services, Inc. on behalf of the New Hampshire Community Action Association and the New Hampshire Local Welfare Administrators Association, received a grant to expand its existing electronic application system to allow individual low-income citizens to both apply and recertify their eligibility for SNAP from anywhere with an Internet connection. • Michigan Department of Human Services (DHS) received a grant to implement in 107 of Michigan's most populated field offices self-service kiosks that will allow Michigan residents to verify eligibility for the Food Assistance Program (FAP) benefits; submit a formal application for assistance; track and receive personalized information about their current FAP benefits; and report household or income changes to their local DHS office. • Oklahoma Department of Human Services received a grant to implement the “Oklahoma Access Project”, which includes the development of an online system for SNAP applications and for recipients to access and update their personal data. • Ohio Department of Job and Family Services, in partnership with the Ohio Association of Second Harvest Foodbanks and the Ohio Benefits Bank, received funding for the Ohio SNAP Online Web-based Application and Change Reporting Electronic Submission systems. Clients will be able to apply for new SNAP benefits or submit changes to their current cases via the internet twenty- four/seven. • Florida Department of Elder Affairs, in partnership with the Florida Department of Children and Families, received a grant to operate a SNAP participation telephone-based pilot project utilizing Web-based and telephone-signature technology, The project will target elders age 60 or older who are likely to be eligible for SNAP benefits but do not participate in the program. • Georgia Department of Human Resources received funding to improve access to SNAP benefits by eligible clients by enhancing the Common Point of Access to Social Services (COMPASS), Georgia’s online application system. The State plans to expand the level of accessibility and automation currently available through COMPASS to the review process, thereby improving the retention of eligible clients and reducing some of the “manual” office processes. 730 30g-38 • City of New York Human Resources Administration, in partnership with the Food Bank for Ne York and the New York City Coalition Against Hunger, received a grant to implement the Food Stamp Recertification Improvement Project, which will streamline the SNAP recertification process and improve the retention of eligible participants. . Program Access Review Guide FNS revised the Program Access Review Guide to reflect increased guidance in planning and conducting the reviews and to clearly identify regulatory requirements associated with program access. The guide establishes uniform expectations for FNS Regional Offices and State agencies to monitor program access a local SNAP certification offices. Reviewers examine case files and interview SNAP staff, clients, and program advocates to determine whether a local SNAP office is in compliance with program access requirements. It is expected that State agencies will adapt this guidance when monitoring the program access portion of the Management Evaluation reviews of their SNAP project areas. State Performance Bonuses The Farm Security and Rural Investment Act of 2002 (P.L. 107-171, the “2002 Farm Bill”) established a performance system offering incentives for a broad array of achievements coupled with a reduced vulnerability to liabilities for excessive error rates. This performance system replaced the former Quality Control liabilities and Enhanced Funding system, which focused solely on error rates. This performance system awards $48 million in bonuses each year to States with high or improved performance for actions taken to correct errors, reduce the rates of error, and improve eligibility determinations, or for other activities that demonstrate effective administration, as determined by FNS. Bonuses provided under this system link two of the program's performance measures: increases in the program payment accuracy rate and increases in access and participation as measured by the Program Access Index. The first bonuses for performance in 2003 were awarded in June and September 2004. The bonuses for performance in 2008 were awarded in June and September 2009. The following States received awards: PAYMENT ACCURACY - Error Rate 0.85% l 2.50 2.64 2.69 Nebraska 2.75 Islands. 3 A 5.10 MOST IMPROVED PAYMENT State FY 2007 FY 2008 8.13% -5.63 SEE BEST Ohio 9.17 .29 -4.88 Delaware 9.36 5.52 -3.84 Total National A 731 30g-39 MOST IMPROVED NEGATIVE ERROR RATE State FY 2007 FY 2008 Change Bonus Amount Colorado 12.46% 7.25% –5.21 $1,454,277 Oklahoma 1 1.22 4.71 -6.51 2,284,606 Total 6,000,000 BEST PROGRAM ACCESS INDEX State - Rate Bonus Amount Missouri 90.0% $2,580,379 District of Columbia 79.6 476,947 Tennessee 74.7 3,342,208 Oregon 73.5 2,021,483 MOST IMPROVED PROGRAM ACCESS INDEX . State FY 2007 FY 2008 Change Bonus Amount Maryland 53.9% 63.9% 9.95 $1,420,511 Delaware 57.1 67.0 9.93 356,813 Wisconsin 48.8 58.6 9,73 1,528,075 Alaska 63.2 72.9 9.73 273,584 Totai 12,000,000 FNS continues its aggressive efforts to collect debts owed to SNAP, collecting delinquent recipient debts through the Treasury Offset Program (TOP), which is the collection mechanism by which Federal payments to individuals, such as tax refunds and Federal salary and benefit payments, are offset to pay outstanding debts. Over $93 million in delinquent debt were collected through TOP in calendar year 2009. Approximately $1.2 billion has been collected through TOP (and its predecessor, the Federal Tax Refund Offset Program) since FNS began this effort as a pilot project in 1992. These claims may not have been collected without Federal collection programs being made available to the State agencies that manage these debts. - FNS Monitoring Efforts Related to Indiana Eligibility Modernization Project During FY 2009, FNS continued to monitor the Indiana Eligibility Modernization Project closely as the State agency tested the new service delivery model which processes 42 percent of the State caseload. The new service delivery model allows SNAP applicants to apply for and manage benefits via a call center and online systems, in addition to the traditional local office setting. - On October 15, Governor Mitch Daniels announced that Indiana will terminate its contract with IBM on December 14, 2009, and provided a two month time frame during which Indiana and IBM will negotiate a disengagement plan. The contract was canceled for poor delivery of services, including application timeliness and customer service. - - Indiana plans to implement a “hybrid” system that incorporates the best of the modernization initiative (such as call centers, document imaging, and online applications) with the “as is" system. In addition to specialized reports developed specifically for this project, FNS has monitored the implementation and operation of the new system through its routine and ongoing reporting systems. Since the project began, FNS staff has also conducted over 50 visits to local Indiana offices to observe operations. FNS will continue to conduct frequent on-site visits during this transition period. FNS continues to report quarterly to Congress on the agency's oversight of the Indiana Eligibility Project as required under the Agriculture, Rural Development, Food and Drug Administration, and Related Agencies Appropriations Act, 2010, P.L. 111-80. - 732 30g-40 State Options In 2009, FNS issued the 8” edition of the State options report—a survey of State choices in areas where States may make policy choices. SNAP statutes, regulations, and waivers provide State agencies with numerous policy options. State agencies use this flexibility to improve how the program works to meet the nutritional needs of low-incom people across the Nation. Choosing certain options can facilitate program design goals, such as removing or reducing barriers to access and sustaining participation for low-income families and individuals, providing better support for those working or looking for work, targeting benefits to those most in need, streamlining administration and field operations, and coordinating SNAP activities with those of other programs. With the passage of the 2002 Farm Bill, the array of State policy options was significantly expanded in several key areas: to Other 47 9 Definition of Income Definition of Resources 37 V Excludes Ali V 39 Vehicle Not º One Vehicle 11 27 44 3 25 Waiver of 34 27 In addition to the above listed options, the 2008 Farm Bill provided States with additional latitude. Under this new legislation, States may reduce paperwork burdens on households with seniors and people with disabilities by extending the “simplified reporting” option to them. States also are allowed to extend transitional SNAP benefits to participants in State-only funded programs, as well as Temporary Assistance for Needy Families (TANF). Benefits may be moved off-line after six months of inactivity and may be expunged after 12 months of inactivity. States have the option of allowing households to apply for SNAP benefits and establish a filing date over the telephone by way of the State establishing an electroni recorded voice signature. - SNAP Outreach Working to increase the participation of the SNAP eligible population is a key part of achieving program nutrition objectives. FNS implements outreach activities to educate potentially eligible low-income people about the nutrition benefits of participating in SNAP. In addition, FNS supports the outreach efforts of States and community organizations by providing tools and resources that can be used “off-the-shelf” or customized by a State or community. All of these educational activities seek to dispel myths and misperceptions about the program and share accurate information to help potentially eligible people make informed participation decisions. Outreach supports FNS’ goal of increasing access and participation among eligible households. • National Media Campaign: The goals of the national media campaign are to position SNAP as a nutrition assistance program, help overcome stigma, teach potential applicants where and how to apply, and highlight FNS' commitment to ensure that all eligible people receive benefits with dignity and respect. Over two months in FY 2009, English language radio advertisements targeting the working poor and low-income elderly aired in 24 media markets and five State-wide radio networks. Nine of the locations also featured Spanish language advertisements during both months. In some cases, bonus and donated time extended play longer than two months and increased the value of the 733 30g-41 paid advertising campaign significantly. As a result of the advertising campaign, markets with a toll-free number received the highest recorded number of requests for program information packets since 2003. The remaining markets used State-specific toll-free numbers. Toolkits: In FY 2009, three new chapters were developed for the outreach toolkits. The new chapters introduce the SNAP name, provide a how-to guide to make radio buys, and offer guidance for optimizing press releases. The new toolkit chapters help partners at the State and local level, including community and faith-based organizations, implement outreach and media activities. The toolkits include “how to” information, “fill in” templates, and examples of outreach materials, Toll Free Information Line: FNS continued to provide a toll free information line in English and Spanish as a service for low-income people to learn more about SNAP including how to apply. Callers can listen to recorded information, obtain referrals to their States for more direct help and information, and request a packet of information by leaving a mailing address with an operator. During FY 2009, nearly 60,000 packets of information were distributed to toll-free number callers. SNAP Outreach Grants: In FY 2009, fourteen grants were awarded to community and faith-based organizations to implement and test innovative outreach strategies to educate and inform non- participating low-income people about the benefits of SNAP and how to apply. The maximum grant award was $75,000. The following organizations received grants: - - Boys and Girls Club of Benton County, Inc. (Bentonville, Arkansas) - Community Action Partnership of Orange County (CAPOC) (Garden Grove, California) Cuban American National Council, Inc. (Miami, Florida) Family Resource Centers of Northeastern Nevada (Elko, Nevada) Goodwill Industries of the Springfield/Hartford Area, Inc. (Springfield, Massachusetts) Greater Erie Community Action Committee (Erie, Pennsylvania) Heartland Rural Health Network, Inc. (Avon Park, Florida) Helping Others Make the Effort, Inc. (Kissimmee, Florida) International Relief and Development (Arlington, Virginia) Lutheran Social Service of Minnesota (Moorhead, Minnesota) Migrant Health Promotion, Inc. (Weslaco, Texas) Ohio District 5 Area Agency on Aging, Inc. (Mansfield, Ohio) Puerto Rican Family Institute Inc. (New York, New York) United Way of El Paso County (El Paso, Texas) Pre-screening Tool: The English and Spanish versions of the online pre-screening tool were maintained in FY 2009. This easy to use tool tells users if they might be eligible for benefits and estimates the amount of benefits they might receive. Where available, the site links the user to a State's pre-screening tool, which can incorporate State-specific policies. The FNS tool also links users to http://www.Goveenefits.gov to find out if they might be eligible for other benefit programs. Educational Materials: FNS continued to distribute English and Spanish educational and outreach materials, such as brochures, posters and flyers, at no cost to State and local agencies and other organizations. Outreach toolkits provide ideas and resource materials to help State and local partners implement effective localized outreach campaigns that reinforce national messages. In FY 2009, approximately 700,000 items were shipped each month. In addition, FNS assessed the need for and initiated development of additional products to increase nutrition program participation among low- income Hispanic and older American populations, the homeless, and individuals newly impacted by the current economy. - - Translated Materials: FNS continued to make SNAP informational materials in 35 languages available through its Web site for easy downloading and duplication at the State and local level. The documents, which were focus-tested with native speakers to ensure cultural and linguistic - appropriateness, are designed to provide basic information about the program and dispel myths and misunderstandings that may discourage eligible people from applying. An “I Speak” document is also 734 30g-42 available so that applicants can indicate their preferred language to the caseworker and accommodations can be made. • Outreach Coalition: FNS continued to manage and support an Outreach Coalition comprised of mor than 1,300 leaders, community action agencies, hunger advocacy organizations, faith-based groups, individuals, food banks, university extension programs, and other groups or individuals interested in giving potentially eligible non-participants the tools to make an informed decisions about applying fo nutrition assistance. In FY 2009, the Outreach Coalition held a meeting and Webinar on ending childhood hunger as well as numerous Webinars focused on important topics, such as Farm Bill changes relative to SNAP. • State Outreach Plans: States have the option of providing outreach as part of their program operations, and FNS reimburses up to 50 percent of the allowable administrative costs for these activities. At the end of FY 2009, 27 States had approved outreach plans, seven States had submitted outreach plans with approval pending, and an additional nine States also performed outreach activitie SNAP Nutrition Education (SNAP-Ed) - Promoting Healthier Eating Habits and Active Lifestyles The goal of SNAP-Ed is to improve the likelihood that persons eligible for SNAP will make healthy food choices within a limited budget and choose physically active lifestyles consistent with the current Dietary Guidelines for Americans and MyPyramid. Because the Dietary Guidelines for Americans and MyPyrami are the foundation of nutrition education for SNAP, it is essential that program materials use current science-based, behaviorally-focused messages that reflect the most current science on human nutrition. Effective SNAP-Ed supports the FNS goal of improving the eating and lifestyle behaviors of low-income Americans. Under current regulations, State SNAP agencies have the option to provide, as part of their administrative operations, nutrition education for persons eligible for SNAP. States seeking Federal funding for SNAP- must submit a State SNAP-Ed plan to FNS for approval each year that outlines SNAP-Ed activities and a corresponding budget for that year. USDA reimburses 50 percent of the cost of approved activities. With increased interest in recent years in promoting health and addressing diet-related diseases, SNAP-Ed has grown substantially. In FY 1992, Federal funding for SNAP-Ed efforts totaled $661,000 used by seve State agencies. By comparison, in FY 2009, approved Federal funds totaled over $343 million with 52 State agencies providing SNAP-Ed. With this increased spending, SNAP-Ed requires more agency staffin and resources to provide policy guidance, resources and information/training in order to facilitate consum focused interventions targeting SNAP eligible populations and SNAP participants. . FNS developed the Education and Administrative Reporting System (EARS) to capture uniform information about SNAP Ed activities, audiences, messages, strategies and information about the cost of nutrition education initiatives across States. EARS is the national reporting system for SNAP-Ed. It was developed in collaboration with key State, local, and academic partners over four years and approved by OMB in FY 2007. All States are implementing the EARS form over a three-year period which began in FY 2008, with full implementation in FY 2010. - For FY 2008, all State agencies and 95 of 96 Implementing Agencies (LAs) submitted the required financi data. The reports show that about three-quarters of SNAP-Ed funds covered program delivery costs, whil the remainder covered administrative costs. Twenty-three IAs (33 percent of the 96 IAs) completed all applicable parts of the EARS form. FNS will continue to analyze data, encourage States to submit more complete and precise data in FY 2010 and identify and share best practices for collecting participation and contact data. 735 30g-43 Other Specific SNAP-Ed Activities SNAP-Ed Connection: This Web site is a dynamic online resource center for State and local SNAP-Ed providers. It is the hub of all nutrition education resources and provides easy access to those materials developed specifically for SNAP-Ed educators. - *. • The Recipe Finder Database is one of the most popular components on the SNAP-Ed Connection Web site. Available in both English and Spanish, this database of over 400 recipes is primarily for nutrition educators working with the SNAP eligible population. Educators can search for relevant nutrition topics and specific recipes to help SNAP-Ed recipients make healthy, low-cost food choices. The Web site can be accessed at: http://snap.nal.usda.gov. • Nutrition Through the Seasons: This product is a unique and dynamic resource for SNAP-Ed professionals that highlights seasonal nutrition education materials. SNAP-Ed providers can use Nutrition Through the Seasons to find timely resources, tools and materials to help plan appropriate seasonal programming for participants. - • Eat Right When Money’s Tight Resource Section: This section includes a tip sheet that provides information on how to shop for a nutritious diet while on a limited budget. Other resources available in this section include print-ready nutrition education materials focused on food budgeting, low cost recipes, and professional reports and statistics on food resource management. Eat Smart Live Strong (ESLS) is an intervention designed to improve fruit and vegetable consumption and increase physical activity among low-income 60-74 year olds participating in or eligible for FNS nutrition assistance programs. The Eat Smart Live Strong Activity Kit uses a variety of engaging, educational approaches to promote two key behaviors: increase fruit and vegetables consumption to 3% cups per day and physical activity to at least 30 minutes most days of the week. Maximizing the Message: Helping Moms and Kids Make Healthier Food Choices provides 16 nutrition messages for low-income moms and children. The publication also features supporting content and guidance for State and local programs in using and disseminating these messages in consistent, consumer relevant ways. They are designed to assist mothers and children in making specific diet-related changes that put the 2005 Dietary Guidelines for Americans into practice. - Models of SNAP-Ed and Evaluation: FNS is conducting two rounds of independent and rigorous impact evaluations of SNAP-Ed projects to identify models of effective SNAP-Ed interventions and practical impact evaluation. Demonstrations are competitively selected based on their promise of success and . potential to provide strong evidence of what is possible through SNAP nutrition education. FNS selected four projects in the first round: Pennsylvania State University’s “Eating Competencies” Web-based intervention; New York State Department of Health’s “Eat Well, Play Hard in Childcare Settings” intervention for pre-school children in Child and Adult Care Food Program Centers; • Chickasaw Nation Nutrition Service’s “Eagle Play” intervention for pre-K through 3" grade students; and . • University of Nevada’s “All 4 Kids” intervention for pre-school children at Head Start Centers. hree additional demonstrations will be selected in FY 2010. 736 30g-44 SNAP/Supplemental Security Income Combined Application Projects (CAP) The CAP demonstrations make it much easier for the elderly and disabled Supplemental Security Income recipients to receive SNAP benefits by reengineering the SNAP application process and eliminating the need for this population to visit the local SNAP office. The combination of standardized benefits, minimal need for independent verification, and normally no need to go to the local office has produced significant increases in participation within the target population. • To date, 15 States are operating CAP demonstrations: Arizona, Florida, Kentucky, Louisiana, Massachusetts, Michigan, Mississippi, New Jersey, New York, North Carolina, Pennsylvania, South Carolina, Texas, Virginia and Washington. • Three States are approved, but have not yet implemented: New Mexico, South Dakota and Wisconsin. • Two States are pending approval: Maryland and West Virginia. • Four States are planning to submit proposals as part of the CAP expansion: Delaware, Idaho, Rhode Island and Utah. Program Coordination The Food and Nutrition Act of 2008 gives State agencies the option to operate a Simplified SNAP (SSNAP), which allows a State to determine SNAP benefits using its TANF rules, SNAP rules, or a combination of both. A “Mini” SSNAP is a subset of the broader SSNAP authority and allows a State agency to replace its TANF or SNAP work-related rules with the other program's rules. These rule changes are limited to households receiving both TANF and SNAP benefits. FY 2008 Certification Payment Error Rates The FY 2008 national average certification payment error rate, announced in June 2009, was 5.01 percent; 35 States had an error rate below 6.00 percent. Regulations require State agencies to analyze data and develop corrective action plans to reduce or eliminate program deficiencies when their combined payment error rate is above the 6.00 percent threshold or their negative error rate exceeds one percent. Corrective action is also required when underpayments result from State agency rules, practices, or procedures. Most States have developed corrective actions to address deficiencies revealed in their FY 2008 quality control data. FNS Regional Offices work directly with States to assist them in developing effective corrective action strategies to reduce payment errors. Regional Offices provide technical assistance to States through data analysis, policy interpretation, training, development and monitoring of corrective action strategies, facilitating the information exchange with and among States through annual payment accuracy conferences State exchange funding, and special error reduction funds. FNS utilizes a tier system for identifying States requiring the most focused intervention, based on high error rates or a Regional Office assessment, so that those States receive special attention. This ensures that technical assistance is available to States that are in first-year liability status or at risk for future liability Status. 737 30g-45 States Notified of Liability Status Under the Quality Control (QC) Provisions of the Farm Bill On June 26, 2009, FNS notified three States that they have incurred a financial liability for having a poor QC error rate for at least two consecutive years. Liability amounts were established against the following States: * Maine 84 W 772 Mexico 91 In addition, nine States (Connecticut, Maryland, Indiana, Wisconsin, Louisiana, Texas, Iowa, Alaska and Guam) exceeded the FY 2008 threshold for the first year. Potential liabilities will be established if any of these nine States have a payment error rate in FY 2009 that has a 95 percent statistical probability that the State's payment error rate exceeds 105 percent of the national performance measure for payment error TateS. Disaster Supplemental Nutrition Assistance Program (D-SNAP) S continues to work to strengthen State agency D-SNAP readiness and operations. On December 17, 2008, FNS promulgated guidance for testing duplicate participation systems. Specifically by October 1, 2010, all State agencies are expected to have tested their systems and find them capable of detecting multiple applications or duplicate participation by all household members. In July 2009, FNS gathered information on the status of State testing and found that almost all State agencies have built a duplicate articipation check system as prescribed in FNS policy, and that approximately half of State agencies have already tested those systems in advance of the October 1, 2010 deadline, S began drafting a proposed D-SNAP regulation, which the agency expects to publish in FY 2010. urrently, D-SNAP is operated using interim regulations, but those regulations do not substantially expand pon the D-SNAP language in the Food and Nutrition Act. The proposed regulation will provide detailed idance on all phases of program operations. FNS responded to a smaller number of disasters in FY 2009 than in recent years, and each program operated was small or moderate in size. The FNS role in D-SNAP operations includes analyzing and responding to State agency requests to operate D-SNAP, waiving applicable certification and issuance policy for ongoing households to ease program administration, providing on-site monitoring of State operations to ensure timely and accurate delivery of benefits, and providing operational guidance to States when issues arise. - - The following summarizes disaster assistance provided in FY 2009: Month State Disaster Type Households Benefits April 2009 AR Tornados - 84 $28,310 April 2009 . MN Floods 26 11,531 February 2009 OK Tornado 120 44,675 September 2009 IL Floods 27,252 12,635,125 Total FY 2009 27,482 12,719,641 Court Suit Activity in SNAP During FY 2009 there were no SNAP-related court suits in which the Department was named as a defendant. Employment and Training (E&T) Fhe Food Security Act of 1985 required States to establish an E&T Program to help able-bodied SNAP recipients find work or gain the skills, training, and experience that lead to employment. The 2002 Farm 738 30g-46 Bill and the 2008 Farm Bill authorized $90 million per year to operate the E&T Program, and an additional $20 million per year for States that commit to serving all at-risk ABAWDs, i.e., those who are subject to the three month SNAP participation limit. States may receive 50 percent matching funds beyond these amounts to operate the program. About 26 percent of SNAP recipients were registered for work in FY 2009, and approximately two-thirds of work registrants were subject to the requirements of the E&T Program. States exempted the remainder from participation. States reported 5.6 million new work registrants in FY 2009, a 33 percent increase from FY 2008, Since an additional 3.3 million work registrants were already receiving SNAP benefits at the beginning of the fiscal year, a total of 8.9 million SNAP recipients were subject to E&T participation in FY 2009. States reported that 10.1 percent, 902,242, of these work registrants, including 319,756 ABAWDs, actually participated in E&T components, States reported that 115,316 qualifying education, training, and workfare slots were filled by at-risk ABAWDs each month nationwide. This means they were able to maintain their SNAP eligibility while they gained the skills, training and experience that will lead to employment and reduced dependence on SNAP benefits. In addition, another 205,337 SNAP recipients participated in an E&T component each month. In FY 2009, FNS allocated $120.9 million in 100 percent Federal E&T grant funds. This included the $90 million regular allocation, $20 million for States committed to serving all their at-risk ABAWDs, and an additional $10.9 million in 100 percent Federal E&T funds carried over from FY 2008 to supplement some State grants. Obligations resulting from Federal funds allocated to States totaled $112.1 million, which is $2.4 million more than in FY 2008. Additionally, the Federal Government matched $190.6 million in State funds spent to administer the E&T Program in FY 2009. The Federal Government also matched $64.5 million in State funds spent to reimburse E&T participants for dependent care, transportation, and other expenses incurred in complying with E&T Program requirements. Electronic Benefit Transfer Systems Electronic benefit transfer (EBT) systems, which replaced the coupon-based method for providing SNAP benefits, became effective nationwide in June 2004. Each recipient household is issued a plastic benefit card with a magnetic stripe to make food purchases. The cards are associated with benefit accounts, which are debited when food purchases are made. In about half the States, EBT cards are also used for TANF and other cash benefit programs. - - In all States, the EBT systems are online systems with cards that have magnetic stripes. These systems are interoperable, which means that recipients may shop in FNS-authorized food retailers in any State. • Coupon Deobligation: Paper coupons remained in circulation because recipients had not spent all of the coupons issued before EBT implementation. The Food and Nutrition Act of 2008 instructed FNS to end coupon obligations one year from enactment of the 2008 Farm Bill. Thus, June 17, 2009, was the last day that clients were able to use remaining paper coupons at licensed retail stores, FNS directed stores to information on coupon redemption through a nationwide mailing, and used our Web site, trade networks, and other avenues to notify retailers of the deadline. The Federal Reserve assisted in notifying member banks, and States were provided with information for clients. Coupon closeout at member banks will continue through the end of the 2009 calendar year. • Integrity – STARS: FNS re-engineered retailer administration functions to ensure effective use of staff and financial resources through automation. This initiative included redesign of the retailer reauthorization process to collect updated store data online. These data are fed through an automated system that evaluates each retailer's response and risk level to flag firms for further scrutiny. • Integrity – ALERT: FNS awarded a contract to build a next generation ALERT system to add new analytical capabilities, integrate a geographic information system solution, and incorporate data mining activities in order to significantly improve program integrity. 739 30g-47 Studies and Evaluations FNS published three major reports related to SNAP during FY 2009, which are available at http://www.fms.usda.gov/ora. These include: • Characteristics of FSP Households 2008, which describes the demographic and economic circumstances of SNAP households and participants; • Trends in Food Stamp Program Participation Rates: 2000-2007, which estimates the percentage of eligible people who participate in the program, examining different sub-groups and comparing trends over time; and • Reaching Those in Need: State Food Stamp Participation Rates in 2007, which estimates the percentage of eligible people who participate in SNAP by State and provides estimates for all individuals and for those in households with earnings. Work on two congressionally mandated studies began in FY 2009: • Evaluation of the Healthy Incentives Pilot will test the impact of financial incentives at the point of sale on the consumption of fruits and vegetables; and - • Feasibility of Returning the Commonwealth of Puerto Rico to the SNAP will identify the policy changes required for and estimate costs associated with such a change. Community Food Projects The Community Food Projects program is authorized under section 25 of the Food and Nutrition Act of 2008. The Community Food Projects Competitive Grants Program supports the development of Community Food Projects with a one-time infusion of Federal dollars to make such projects self-sustaining. Funds have been authorized for this program in the amount of $5 million per year. While funded through the SNAP account, the National Institute of Food and Agriculture manages the program. NUTRITION Assistance For PUERTO Rico (NAP) Program Mission The Omnibus Budget Reconciliation Act of 1981 added a new Section 19 to the Food Stamp Act of 1977, as amended, which replaced SNAP in Puerto Rico with a block grant, effective July 1, 1982. Section 19 of the Food and Nutrition Act of 2008, as amended, retains the authority for the Puerto Rico nutrition assistance block grant. The block grant requires that Puerto Rico submit and gain approval from the Secretary for a program plan each year. The plan must assess the food and nutrition needs of the island's most needy residents, describe the assistance needed, describe how it would be provided to the neediest residents, describe the amount of administrative expense needed, and meet such other requirements as the Secretary might prescribe by regulation. The Secretary is required to provide for the review of programs for assistance under Section 19 and is allowed to provide appropriate technical assistance for such programs. Facts in Brief • An average of 1.19 million people were served monthly during FY 2009, • In FY 2009, total benefit costs were $1,929 billion, or about $135.08 per person per month for nutrition assistance program recipients. - • Puerto Rico spent an estimated $70.7 million of Federal funds on administrative activities in FY 2009, which are matched by an equivalent amount of State funds. • On September 1, 2001, Puerto Rico began targeting 75 percent of nutrition assistance benefits to the purchase of food while continuing to provide 25 percent of benefits in cash through the Commonwealth’s EBT system. 740 30g-48 Federal Responsibilities of the Block Grant Puerto Rico proposes in July for the fiscal year beginning on the following October 1 its annual program plan that identifies the costs of benefits, administration and other projects. FNS must review and approve the Commonwealth’s annual plan and monitor program operations to ensure program integrity. These monitoring activities include reviewing financial reports of obligations and expenditures and on-site management reviews of selected program operations. The cost of these components for FY 2007, FY 2008 and FY 2009 are as follows: NUTRITIONASSISTANCE FOR PUERTO RICO Summary of Funding 2007 2008 2009 Actual Actual Estimated ($ 000) ($ 000) _ ($ 000) Benefit Costs $1,496,030 $1,569,236 $1,929,142 Administrative Costs 54,710 52,841 70,726 Nutrition Education Program 427 444 700 Total Federal Funds 1,551,167 1,622,521 2,000,568 State Administrative Costs 54,710 52,841 70,726 Total Program Costs 1,605,877 1,675,362 2,071,294 Participation From its inception, the SNAP in Puerto Rico served a much higher proportion of the total population than was true of the United States as a whole, due to the significantly lower living standards in Puerto Rico. This continues to be the case under the block grant program: 1.19 million persons, or 30.3 percent of Puerto Rico’s total estimated population of 3.958 million people, participated in the program in FY 2009. Monthly participation for FYs 2007, 2008 and 2009 are as follows: NUTRITION ASSISTANCE FOR PUERTO RICO Summary of Participation 2007 2008 2009 Actual Actual Estimated Average Number of Persons (million) 1.07 1,11 1.19 Average Number of Households 492,884 515,001 561,711 Average Household Size (persons) 2.1.8 2.16 2.13 Average Benefit Per Household $247 $248 $246 74.1 30g-49 NUTRITION ASSISTANCE FOR AMERICAN SAMOA rogram Mission - he American Samoa Nutrition Assistance Program began on July 1, 1994, and was authorized by Public aw 96-597 (December 24, 1980). The program is now authorized in Section 19 of the Food and Nutrition ct of 2008. In FY 2009, $8.034 million in grant funds ($964,000 ARRA) were authorized to be expended nder American Samoa's block grant. - acts in Brief A monthly average of 3,079 persons, or about 4.7 percent of American Samoa's total estimated population of 64,827, were served during FY 2009. In FY 2009, average monthly benefit costs were $347,298, or $112.79 per person. - American Samoa spent $807,227 for administrative activities for FY 2009. Block grant funding provides 100 percent of administrative and benefits costs. The program serves the low-income elderly, blind and disabled population. American Samoa prints its own food coupons. - ederal Responsibilities of the Block Grant merican Samoa submits a memorandum of understanding each fiscal year specifying how the program ill be operated, including eligibility requirements to stay within the capped block grant amount. FNS ust review and approve the annual memorandum of understanding and monitor program operations to nsure program integrity. These monitoring activities include reviewing financial reports of obligations nd expenditures and on-site management reviews of selected program operations. NUTRITION ASSISTANCE FOR THE COMMONWEALTH OF THE NORTHERN MARHANA ISLANDS *rogram Mission The Commonwealth of the Northern Mariana Islands’ (CNMI) nutrition assistance program began on uly 2, 1982. The program was authorized by Public Law 96-597 (December 24, 1980), which allowed JSDA to extend programs administered by the Department to the CNMI and other territories. In FY 2009, H2.14s million in grant funds were provided to CNMI. - Facts in Brief A monthly average of 7,837 people, or 9.05 percent of CNMI's total estimated population of 86,616, were served during FY 2009. - In FY 2009, average benefit costs were $88.49 per person per month. The CNMI spent $1,244,293 on administrative activities for FY 2009. Block grant funding provides 100 percent of administrative and benefit costs. - CNMI is allowed to set its own eligibility standards to stay within the capped block grant. Thirty percent of each allotment consists of coupons earmarked for the purchase of local commodities (food and nonfood items such as fishing equipment, garden supplies and livestock) to provide work. incentives, develop self-sufficiency, and stimulate economic development and local food production. CNMI prints its own food coupons. ſederal Responsibilities of the Block Grant he CNMI submits a memorandum of understanding each fiscal year, specifying how the program will be perated, including eligibility requirements to stay within the capped block grant amount. FNS must eview and approve the annual memorandum of understanding and monitor program operations to ensure 742 30g-50 program integrity. These monitoring activities include reviewing financial reports of obligations and expenditures and on-site management reviews of selected program operations. FOOD DISTRIBUTION PROGRAM ON INDIAN RESERVATIONS (FDPIR) Program Mission FDPIR is an alternative to the SNAP for low-income households on Indian reservations and low-income Indian households in designated service areas near reservations or in Oklahoma, FDPIR implements section 4(b) of the Food and Nutrition Act of 2008, as amended, to allow ITOs to operate a food distribution program for households who prefer USDA Foods to regular SNAP benefits. ITOs that ar determined capable are permitted to administer FDPIR. - Facts in Brief • In FY 2009, five States and 99 ITOs administered 111 programs on 271 Indian reservations, pueblos, rancherias, and Alaska Native Villages. Nutrition assistance was provided to an average of 95,369 persons per month at a cost to FNS of $54,54 per food package in FY 2009, with an average monthly per person administrative cost of $31.47. - - Recovery Act Funding FDPIR received $5 million in ARRA funding. These funds are being used by ITOs and State agencies that administer FDPIR to purchase equipment and infrastructure improvements. Funds in the amount of $3.8 million were awarded in FY 2009, and the remaining balance of $1.3 million will be awarded in FY 2010. FDPIR PARTICIPATION AND COST 2003 2004 2005 2006 2007 2008 2009 Average Participation (in Thousands) 107.6 104.3 99.0 89.9 86.6 90, i. 95.4 Per Person Per Month Food Cost $36,07 $39.14 || $40.69 $38,93 || $44.40 $54.52 $54,54 (Entitlement) - - Total FNS Food Cost | - ($ in Millions) $46.57 - $48.99 || $48.35 || $41.32 $46.94 $55.32 $62.90 *º Per 6.7% 8.5% 4.0% -4.3% 14.1% 22.8% 0.0% Note: Total Per Person Food Costs differ from commodity procurement obligations due to inventory level changes. Food Package Improvements FNS continuously reviews the FDPIR food package, in consultation with program customers, to improve its nutritional profile and acceptability. On a regular basis, a work group consisting of tribally appointed FDPIR directors, procurement specialists from FSA and AMS, nutrition and health experts from the Indian Health Service and the Centers for Disease Control and Prevention (CDC), and FNS nutritionists and program staff considers changes to the food package and makes recommendations to FNS. The work group is continuing to focus on ways to reduce saturated fat, sugar, and sodium and is also exploring ways to improve the desirability and convenience of products in the food package. Improved Access to Fresh Fruits and Vegetables In FDPIR, the Fresh Produce Program began as a pilot program in FY 1996 at two sites. This initiative, a joint venture with the Department of Defense, provides fresh fruits and vegetables that program participants may select in lieu of canned goods. In FY 2009, about 91 percent of the FDPIR programs were enrolled in the Fresh Produce Program, allowing most FDPIR participants to receive a variety of fresh fruits and vegetables that would otherwise be very difficult for them to obtain. 7.43 30g-51 SUPPLEMENTAL NUTRATION ASSISTANCE PROGRAM - SUMMARY OF BENEFHT COSTS, PARTICIPATION AND STATE ADMINISTRATIVE FUNDING FISCAL YEAR 2009 REGULAR ARRA VALUE OF MONTHL STATE STATE STATE STATE OR BENEFITS : BENEFITS : BENEFITS : BENEFT HSSüED ISSUED ISSUED PER FUNDING FUNDING 2/ FüNDING $84, $38, $4 1, 48. $29,171 $514,451 -$23, -123, These data are based in part on preliminary data submitted by State and local agencies subject to change as revised reports are received. Totals may not add due to rounding. 1/ These entities receive a fixed grant and do not report participation. 2) Excludes $497,000 in ARRA state administrative funding which was provided to FNS for management and oversight. 744 30g-52 SUPPLEMENTAL, NUTRITIONASSISTANCE PROGRAM FiRMS AUTHORIZED TO RECEIVE AND REDEEM FOOD STAMP BENEFITS - Fiscal Year 2009 Brug/ for Horne Senior Alcohol l Battered Group less Private Citizens - Treat Women Communal i.iving Meal | Meal Restaurantſ Center/ State or rtient and Dining Arrange- Pro- || Delivery Meal Residential T ment 745 30g-53 FOOD DiSTRIBUTION PROGRAM ON INDIAN RESERVATIONS - PARTICIPATION AND FUNDING FiSCAL YEAR 2009 TOTAL FOOD 274, 2,597 484,541 12t 2,327 377 f PCIMS / Computer souKCE: FPRSFNS-152 data- Food distributed to participants in fiscal year 2009. 1/ Total value of entitlement foods. Costs do not inciude bonus commodities, food losses, storage and transportation for certain items (Group A fruits and vegetables, all Group B commodities), the value of food used for nutrition education, or the Department of Defense Regional Pilot. 2! Administrative funding represents the total of Federal outlays and unliquidated obligations. NOTE: These data are based in part on preliminary reports submitted by State and local agencies and are subject to change as revisions are received. Totals reflect Federal obligations and differ from State reported data. 746 30g-54 FOOD AND NUTRITION SERVICE FOOD DISTRIBUTION PROGRAM ON INDIAN RESERVATIONS Quantity and Value of Commodities Fiscal Year 2009 Indian Reservations ENTITLEMENT COMMODITIES Pounds Þollars SECTIONTājā275E - APPLE JUICE, CANNED 3,320,040 $4,409,178 APPLESAUCE, CANNED 706,050 426,269 APRICOTS, CANNED 232,650 154,447 BEANS, GREAT NORTHERN 161,280 81,285 BEANS, GREEN CANNED 1,436,806 709,985 BEANS, KIDNEY LIGHT 426,876 225,148 BEANS, LIMA 201,600 145,374 BEANS, PINTO 1,335,360 536,611 BEANS, REFRIED 293,760 159,417 BEANS, VEG 51 1,680 246,356 BEEF, CANNED 648,000 1,528,384 BEEF, FROZEN GROUND 2,360,000 4,210,722 BEEF, ROUND ROAST 1,120,000 3,667,296 BEEF, STEW 756,000 707,303 CARROTS, CANNED 524,250 302,569 CHICKEN, CANNED 375,000 690,254 CHICKEN, CUT UP 2,035,200 1,867,395 CORN, CANNED CREAM 510,300 251,183 CORN, CANNED WHOLE KERNEL 1,845,511 863,576 CRAN APPLE JUCE 2,070,540 1,364,696 DPSC-FRESH PRODUCE* 5,997,582 EGG MiX 648,000 1,660,084 FRUIT, MIXED 1,140,525 776,198 GRAPE JUICE 1,672,192 957,119 GRAPEFRUIT JUICE 634,478 240,481 HAM WATERADD 612,000 795,269 ORANGE JUICE, CANNED 2,891,520 t,138,073 PEACHES, CANNED 1,902,150 1,393,972 PEARS, CANNED 1,209,150 898,371 PEAS, CANNED 791,213 451,523 PLUMS, D 24 324,000 513,675 POTATOES CANNED 514,080 273,283 POTATOES, DEHYDRATED 1,050,000 1,612,815 PUMPKiN, CANNED 72,900 52,205 RAISINS 24 777,600 828,507 SPAGHETTI SAUCE 1,239,300 538,629 SPłNACH, CANNED 339,150 204,192 SWEET POTATOES, CANNED 137,700 64,200 TOMATO JUICE, CANNED 1,512,414 529,661 TOMATO SAUCE, CANNED 1,101,600 461,961 TOMATO SOUP 709,500 469,064 TOMATOES, CANNED 1,021,815 424,436 TUNA, CANNED 388,800 740,285 TURKEY HAM 440,000 788,040 VEG MIX 300 569,700 307,685 VEG SOUP 780,450 636,155 43,351,140 $42,300,913 Total Section 6/32 Type 747 30g-55 FOOD AND NUTRITION SERVICE FooD DISTRIBUTION PROGRAM ON INDIAN RESERVATIONS (cont.) Quantity and Value of Commodities fiscal Year 2009 ENTITLEMENTCOMMODITIES Pounds Dołłars SECTIONTIETFE- BUTTERY SPREAD 1,020,914 $982,702 CEREAL, CORN & RICE 154,833 258,445 CEREAL, DRY CORN 420,482 577,309 CEREAL, ORY OATS 208,338 413,272 CEREAL, DRY RICE 299,784 435,706 CEREAL, WB FLAKES 213,653 359,023 CHEESE 30 LVS 2,930,400 4,119,691 CHEESE REDUCED SKIM SLC 1,108,800 1,422,493 CORNMEAL 1,370,880 229,717 CRACKERS 720,000 835,200 EGG NOODLES 1,003,560 762,124 FAR#NA 349,272 198,831 Fi OUR MIX, LOWFAT 1,582,080 1,406,275 Fi OUR WW 599,760 122,565 FLOUR, ALL PURPOSE 7,582,680 1,565,750 MACARON; 1,296,600 655,180 MACARON AND CHEESE 714,096 718,461 MILK, EVAPORATED 3,047,760 1,493,912 MILK, UHT FLUID 1% 5,185,800 1,800,493 OATS 1,605,240 1,042,633 Oil, VEGETABLE 2,042,964 1,090,746 PEANUT BUTTER 838,823 754,581 PEANUTS, ROASTED 544,320 892,473 RICE 1,569,000 520,545 ROTINI, WHOLE GRAIN 578,000 332,085 SPAGHETTI 1,395,600 539,273 Total Section 446 Type 38,383,639 $23,529,485 AMS / FSA f PCIMS / Computer Support $482,636 Anticipated Adjustment 12,581,771 TOTAL COMMODETY ENTITLEMENT 81,734,779 $78,894,805 COMMODITIES HAM, WATERADDED otai Section 32 Type COMMODfTIES |NSTANT 2 otal Section 416 Type AL BONUS COMMODITIES Anticipated Adjustment GRAND TOTAL * * 144,000 Pounds 363,648 *DPSC-FRESH PRODUCE includes Farm Bill funds (32A). Dollars $509,107 748 30-65 FooD AND NUTRITION SERVICE The estimates include appropriation language for this item as follows (new language underscored, deleted matter enclosed in brackets): ^- Commodity Assistance Program: For necessary expenses to carry out disaster assistance and the Commodity Supplemental Food Program as authorized by section 4(a) of the Agriculture and Consumer Protection Act of 1973 (7 U.S.C. 612c note); the Emergency Food Assistance Act of 1983; special assistance for the nuclear affected islands, as authorized by section 103(f)(2) of the Compact of Free Association Amendments Act of 2003 (Public Law 108–188); and the Farmers' Market Nutrition Program, as authorized by section 17(m) of the Child Nutrition Act of 1966, 1. ($247,979,000) $249,619,000, to remain available through September 30, [2011 of which $6,000,000 shall be for emergency food program infrastructure grants authorized by section 209 of the Emergency Food Assistance Act of 2, 1983: Provided, That of the amount provided, $5,000,000 is to begin service in 7 additional States that have plans approved by the Department for the commodity supplemental food program) 2012: Provided further), That none of these finds shall be available to reimburse the Commodity Credit Corporation for commodities donated to the program: Provided further, That notwithstanding any other provision of law, effective with funds made available in fiscal year [2010, 2011 to support the Seniors Farmers' Market Nutrition Program, as authorized by section 4402 of the Farm Security and Rural Investment Act of 2002, such funds shall remain available through September 30, 2011] 2012: Provided further, That of the funds made available under section 27(a) of the Food and Nutrition Act of 2008 (7 U.S.C. 2036(a)), the Secretary may use up to 10 percent for costs associated with the distribution of commodities. - - - The first change eliminates language related to funding for infrastructure grants provided in FY 2010, The second change eliminates language related to finds dedicated to new states in CSFP which is no longer necessary. The appropriation level includes sufficient funding to maintain caseload levels of the seven additional states. 749 30-66 FOOD AND NUTRITION SERVICE LEAD-OFF TABULAR STATEMENT AND SUMMARY OF INCREASES AND DECREASES COMMODITY ASSISTANCE PROGRAM (CAP)- CURRENT LAW Appropriations Act, 2010 $247,979,000 Budget Estimate, 2011 249,619,000 Increase in Appropriation +1,640,000 Summary of increases and Decreases - Current Law (On basis of appropriation) - 2010 Program 2011 Item of Change Estimated Changes Estimated Commodity Supplemental Food Program $171,409,000; $5,379,000 $176,788,000 Farmers' Market Nutrition Program 20,000,000 0. 20,000,000 The Emergency Food Assistance Program aſ 49,500,000 500,000 50,000,000| TEFAP Infrastructure 6,000,000 -6,000,000 0| Nuclear Affected Islands 575,000 6,000 581,000 Disaster Assistance 495,000 5,000 500,000 1T Modernization and Support 0 1,750,000 1,750,000 Total CAP Appropriation 247,979,000 1,640,000; 249,619,000 a/ The SNAP appropriation provides an estimated $248,000,000 in FY 2010 and $246,500,000 in FY 2011 to The Emergency Food Assistance Program (TEFAP) for the procurement of USDA foods. Up to 10 percent of this amount is permitted to be used for TEFAP administrative costs. 750 30-67 PROJECT STATEMENT (On basis of appropriation) 2009 20 ! {} increase or 20 I Project Actual SY} Estimated SY} Decrease Estimated SY I. Commodity Supplemental Food Program $160,430,000 $17,409,000; $5,379,000: (1) śl 76,788,000; * 2. Farmers' Market Programs - - Farmers' Market Nutrition Program 19,800,000 20,000,000 20,000,000 Senior Farmers' Market Nutrition Program (transfer) aſ 20,600,000 20,600,000 {} 20,600,000 Total Adjusted FMP 40,400,000 40,600,000 o 40,600,000 3. The Emergency Food Assistance Program - - Administrative Costs 49,500,000 49,500,000 500,000 (2) 50,000,000; 4. ARRA, P.L. 1-5 TEFAP Commodities 100,000,000 0 () 0. TEFAP Adminismative Costs 50,000,000 0 {} {) 5. Other Programs - Nutrition Services incentive Program (transfer) b/ 2,681,000 2,344,000 -2,544,000 () Nuclear Affected lslands 575,000 575,000 6,000: (3) 581,000 Disaster Assistance 495,000 495,000 5,000; (4) 500,000 }T Modernization and Support 0. 0 1,750,000; (5) 1,750,000 TEFAP infrastructure Grants {} 6,000,000 -6,000,000; (6) {} Total Adjusted Appropriation 404,081,000|| 2: 271,123,000 2 -904,000 270,219,000 ARRA Funds -150,000,000 () 0. {} Transfers (SFMNP and NSFP) -23,281,000 23,144,000 2,544,000 -20,600,000 Total Appropriation 230,500,000] 2 247,979,000 2 1,640,000 249,619,000 aſ Section 4406(c)(1) of the Food, Conservation, and Energy Act of 2008 (P.L. 110-246) authorized the transfer Of $20,600,000 from the Commodity Credit Corporation (CCC) for the SFMNP. b/ * Administration of NSIP was transferred to DHHS in FY 2003, though FNS continues to be involved in the purchase of USDA Foods. Obligations for commodity procurement for NSIP are funded under an agreement with DHHS. Public Law 110-19, effective April 23, 2007, authorizes the transfer of NSIP funds from DHHS for the purchase of USDA foods and related expenses. The NSIP transfer amount cannot currently be determined and will be available in FY201 . 751 1. Commodity Food Program USDA Food Purchases Administrative Costs 30-68 PROJECT STATEMENT (On basis of available funds) CSFP Recovery of Prior Year Obligations Unobligated Balances: Available Start of Year Available End of Year CSFP Farmers' Market Program's Seniors Farmers' Market Nutrition Program (transfer) Farmers' Market Nutrition - FMP Transfer from CCC Recovery of Prior Year Obligations Unobligated Balances: Available Start of Year Available End of Year ota; FMP The Emergency Food Assistance Program aſ Administrative Costs SNAP/TEFAP Admin. (non add) SNAP/TEFAP USDA Foods Recovery of Prior Year Obligations Unobligated Baiances: Available Start of Year Available End of Year TEFAP ARRA, P.L. 111-5 TEFAP USDA Foods TEFAP Costs ARRA Recovery of Prior Unobligated Balances: Available Start of Year End of Year AARA Other Programs: Nutrition Services incentive Program (NSP) (transfer) b/ Nuclear Affected islands Disaster Assistance łT Modernization and Support TEFAP Infrastructure Grants Other Transfer from ĐHHS Recovery of Prior Year Obligations Unobligated Balances: Available Start of Year Available End of Year otal Other CAP otal Funds 2009 2010 SY £5timated 22,466,41 49,8}} (13,802, SY increase or Decrease 2011 Estimated $135,471 4 1 7 SY 752 a/ 30-69 The SNAP appropriation provides $250,000,000 for The Emergency Food Assistance Program for the procurement of USDA Foods in FY 2009. An estimated $248,000,000 is provided in FY 2010 and $246,500,000 in FY 2011. Beginning in FY 2009, up to 10 percent of the funding is permitted to be used for TEFAP administrative costs. The FY 2009 TEFAP administrative obligations include $20,000 converted to food. NSIP transferred to DHHS in FY 2003, but FNS continues to be involved in the purchase of USDA Foods. Obligations for commodity procurement for NSIP are funded under an agreement with DHHS. Public Law 110-19, effective April 23, 2007, authorizes the transfer of NSIP fimds from DHHS for the purchase of USDA Foods and related expenses. The NSIP transfer amount cannot currently be determined and will be available in FY2011. - Justification of increases and Decreases The FY 2011 request for the Commodity Assistance Program reflects an increase of $1,640,000. (l) (2) (3) (4) (5) (6) An increase of $5,379,000 for the Commodity Supplemental Food Program ($171,409,000 available in FY 2010). Explanation of Change: This increase will support the FY 2011 caseload level and higher caseload utilization levels (utilization of caseload is expected to be lower than normal in FY 2010 due to the entry of seven new States and the expansion of caseload in existing States. Caseload utilization is expected to return to normal in FY 2011). The average monthly food cost per person will increase from an estimated $30.30 for women, infants, and children in FY 2010 to $30.65 in FY 2011, and from $21.71 to $22.00, respectively for the elderly. The administrative grant per caseload slot is projected to increase from $67.89 in FY 2010 to $69.99 in FY 2011. An increase of $500,000 in The Emergency Food Assistance Program ($49,500,000 available in FY 2010). Explanation of Change. This increase will restore the base funding activity to $50,000,000. An increase of $6,000 in Nuclear Affected Islands program ($575,000 available in FY 2010). Explanation of Change: This increase restores funding to the authorized level of $581,000. An increase of $5,000 in Disaster Assistance program ($495,000 available in FY 2010). Explanation of Change: This increase restores funding to the authorized level of $500,000. An increase of $1,750,000 for the Commodity Assistance Program account. Explanation of Change: This will provide funding for Information Technology Modernization and Support (see issue paper on page 30-72). - - A decrease of $6,000,000 in TEFAP Infrastructure Grants for FY 2011. Explanation of Change: This decrease is due to funding available for TEFAP Infrastructure Grants for FY 2010 and not unchuded in FY 2011, - 753 30-70 COMMODITY SUPPLEMENTAL FOOD PROGRAM CALENDAR YEAR AUTHORIZED CASELOAD LEVELS FOR WłC AND ELBERLY STATE { TRIBAL ORG. 2009 2010 Alaska 2,109 2,460 Arizona - 14,473 - 12,965 California - 53,827 73,710 Qolorado 17.277 17,627 District of Columbia 6,647 6,647 }}linois 13,676 . - } 6,525 indiana - 4,273 4,273 jowa - - 3,255 - 3,438 Kansas -- 4,822 5,322 Kentucky 15,712 22,328 Louisiana - 64,689 74,689 Michigan. 77,586 82,086. Minnesota - 14,071 15,070 Mississippi - 7,0}4 9,014 Missouri 9,315 15,000 Montana - 6,809 - 10,000 Nebraska $2,924 13,396 Nevada 5,909 - 6,909 New Hampshire 7,253 7,264 New Mexico - 16,371 21,108 New York 3},068 32,068 North Carolina - 1,160 1, i42 North Dakota - 2,799 - 2,765 Oglala Sioux, SD . - 608 - 603 Öhio 15,589 $9,400 Oregon 1,334 - 2,187 Pennsylvania - 14,583 32,674 Red Lake, MN 98 - - 98 South Carolina 3,705 5,205 South Dakota 2,812 5,232 . Tennessee - 13,366 13,213 Texas • 15,984 31,958 Vermont 3,639 - 4,000 Washington 3,666 - 5,098 Wisconsin 5,070 10,270 SUBTOTAR. 473,473 - 585,529 NEW STATES aff Arkansas - - 2,817 Beławare 2,500 Georgia 2,847 Maine - 2,817 New Jersey - 2,817 Oklahoma 2,847 Utah - 2,817 SUBTOTAL - 19,402 TOTAL CASE},OAD 473,473 - 604,931 aſ The Agriculture, Rural Development, Food and Drug Administration, and Related Agencies - Appropriations Act, 2010 (P.L. 111–80) earmarked $5 million for new States with approved State plans. 754 30-71 2009 2010 2011 Actual Estimated Difference Estimated (000) (000) (000) (000) RESOURCES.--START OF YEAR : Appropriation $160,430 $171,409 $5,379 $176,788 Cash Carry-Inſrecoveries 5,040 17,707 -17,707 0. Beginning Inventory (Federal-State-Local) 28,557 36,719 10,384 47,103 TOTAL RESOURCES 194,027 225,835 -1,944 223,891 DEMAND: 1. Program Performance Data: Caseload (Calendar Year) 473.473 604,931 {}.000 604,931 Participation (Fiscal Year) 466.659 585.461 19.032 604.543 Participation Women-infants-Children 23,322 21.421 - 1.071 20.350 Elderly - 443,337 564.040 20, 153 584, 193 |Avg. Food Cost Person/Month (whole $): Women-Infants-Children 29.81 30.30 0.35 30.65 FNS Funded aſ 26, 55 28.00 -0.25 27.75 Free (donated) 3.26 2.30 0.60 2.90 Elderly 21.56 24.71 0.29 22.00 FNS Funded aſ 18.77 1947 -0.29 19, 18 Free (donated) 2.79 2.24 0.58 2.82 2. Food Costs: Food Distribution Costs $107,287 $138,979 $2,256 $141,235 Women-Infants-Children 7,430 7, 197 -420 6,777 Elderly 99,857 131,782 2,676 134,458 Commodity Administrative Costs 895 915 10 925 3. State Administrative Expenses 31,420 38,838 2,479 41,317 TOTAL DEMAND 139,602 178,732 4,745 135.177 BALANCES--YEAR-END: Funds (Carry-out) 7 O {} 0 Ending inventory 54,418 47,103 -6,689; 40,414 Purchases 134,044 150,278 -14,807 135,471 Inventory Change 25,861 10,384| -17,073 -6,689 aſ In addition to reported food package costs, the number also reflects costs associated with storage/transportation, losses and nutrition education expenditures. 755 Program: Proposal: Rationale: Goal: Budget Impact: ($ in millions) 30-72 FNCS PRESIDENT'S BUH) (SET FESCAL YEAR 2011 º - CURRENT LAW Commodity Assistance Program Information Technology Modernization and Support According to 7 CFR 250, State Distributing Agencies (SDAs) must maintain records of where USDA foods have been distributed; SDAs must disseminate the FNS recall message to each Recipient Agency (RA) that is affected. If RAs do not receive timely information from SDAs, it may be because SDAs lack efficient technologies to quickly notify RAs about recalls. FNS proposes to fund information technology enhancement at SDAs to assist them in fulfilling their responsibility to quickly identify and inform the RAs that received recalled products, including but not limited to: • Tracking and improving traceability of recalled foods. (Pilot Bar Code/Radio Frequency ID $1.0 million); • Communicating with recipient agencies about recalled foods; • Enabling Web-based information postings ($600,000 to do requirements/business process for above 2 bullets); * Notification service contract ($150,000); • Rapid Alert System; and • Self-Registration Notification Service (Commodity Alert System). As technologies improve and change, these information technology systems will need to be updated and enhanced. USDA Strategic Goal: Ensure that all of America's children have access to safe, nutritious and balanced meals. FY 2011 Budget Authority $1.75 756 30-73 Food and Nutrition Service GEO GRAPHIC BREAKDown OF OBLIGATIONS AND STAFF-YEARS - 2009 and Estimated 2010 and 2011 FY 2009 757 30-74 FOOD AND NUTRITION SERVICE Commodity Assistance Program Classification by Objects 2009 Actual and Estimated 2010 and 2011 (in thousands of dollars) Personnel Compensation: Washington D.C. Field 2009 2010 $59 70 2011 $60 70 } ] Total personnel compensation | 29 #30 12 Personnel benefits Benefits for former personnel 4 ) 41 Total personnel compensation and benefits | 70 iT 1 21 22 23. ] 23.2 | 23.3 24 25 25. 25.2 25.3 25.4 25.5 25.6 25.7 25.8 26 3 32 4 42 4 4 9 | } 3 . Other Objects: - Travel and transportation of persons Transportation of things Rental payments to GSA Rental payments to others Communications, utilities, and misc. charges Printing and reproduction Other Services Contractual Services Performed by Other Federal Agencies Related Expenditures - Repair, Alteration or Maintenance of Equipment, Furniture of Structures Contractual Services - Other Agreements ADP Services and Supplies Misceljaneous Services Fees Supplies and materials Equipment Land and structures Grants, subsidies and contributions Insurance claims and indemnities Interest and dividends Special Payments Undistributed 565 236,342 151,288 135,882 161,075 135,300 * Total other objects Total direct obligations Totals for FY 2009 and 2010 include ARRA Funds. 388,195 388,195 296,957 297,127 270,048 270,219 758 30-75 FOOD AND NUTRITION SERVICE COMMODITY ASSISTANCE PROGRAMS SUMMARY OF RECOVERY ACT FUNDING Program/Project/Activity 2009 f 2010 2011 TEFAP Commodities $100,000,000 0. 0 TEFAP Administrative Funds * 50,000,000 O {} Total ARRA Appropriation i50,000,000 0 0 PROJECT STATEMENT (On basis of available funds) 2009 2030 Unobligated Balance Start of Year -25,000,000 Y Program Implementation Activities: Goals and Coordination Efforts: These funds will be used to help ensure that Americans affected by the economic crisis receive adequate food and nutrition services. Objectives: These funds will be used to help food banks, soup kitchens and food pantries provide food assistance due to recent economic conditions. TEFAP commodity funding will be used to purchase foods that States order on behalf of their emergency food assistance network, TEFAP administrative funding may be used to offset allowable State or local costs associated with the distribution of USDA or privately-donated food. Delivery Schedule: States began placing orders for food in March 2009, and the first deliveries began in May of 2009. Deliveries will continue through 2010. Performance Measures: FNS will track the percentage of food assistance that each State orders and the amount of administrative funds obligated by each State as a measure of ARRA achievement. These funds are not expected to directly create any jobs. 7.59 30-76 Target 2009 2010 20] ] Value of Food Ordered for Distribution to Food - - Banks, Soup Kitchens and Food Pantries $100 million {} {} FY 2009 Accomplishments: These funds were used to help food banks, soup kitchens, and food pantries; they provided food assistance due to recent economic conditions. Funds were used to purchase foods that States ordered on behalf of their emergency food assistance network. - FY 2010 Planned Activities: The remaining TEFAP administrative funds carrying over into FY 2010 are provided to States to help defray State and local costs associated with the transportation, processing, storage, and distribution of USDA foods of foods secured from other sources such as the private sector. . 760 30-77 ARRA TEFAP Grants Admin Funds 5}, 273,6} | 3,3 367 22; 54,47 3} 96, 486,575 $98.95 } 44 39] 102,771 33 68, Commodities Admin Funds $i 1,925,73 f } }, !,272,2] 1,688,7? i | Tribes Set Asi........................., Associated States transportation/misc................. sº º a t - - - - - - - - * * * is ºr * * H 1,550, 42.7% 3 | 9] } 406,04 i 2,056,661 f 1,959, 285,55? 281,72} 366,2} l 2 8,21 761 30g-56 COMMODITY ASSISTANCE PROGRAM STATUS OF PROGRAM The Commodity Assistance Program (CAP) account combines funding for the Commodity Supplemental Food Program, administrative expenses for the Emergency Food Assistance Program, assistance to the Nuclear Affected Islands, Disaster Relief, the Senior Farmers’ Market Nutrition Program, and the WIC Farmers' Market Nutrition Program, Commodity Supplemental Food Program rogram Mission he Commodity Supplemental Food Program (CSFP) provides supplemental USDA foods to low-income regnant, postpartum and breastfeeding women, infants, children up to age six and the elderly. The program operates in 32 States, the District of Columbia, and through two ITOs. The foods provided are purchased by USDA utilizing funds appropriated for the program each year as well as funds provided for the support of domestic agricultural markets through the removal of agricultural market surpluses and price support activities. CSFP participants receive monthly food packages containing USDA foods. Food packages are designed to address the specific nutritional needs of women, infants, children, and elderly clients. They include such nutritious foods as canned fruits and vegetables, juices, meats, fish, peanut butter, cheese, cereal and grain products, and dairy products. Infants receive formula and rice cereal, USDA also provides administrative funding to States. The FY 2010 Agriculture Appropriations Act provides funding for additional seven States including Arkansas, Delaware, Georgia, Maine, New Jersey, Oklahoma, and Utah. Facts in Brief • In 2009, 473,473 caseload slots were allocated to participating States and ITOs. • For FY 2009, program participation averaged 466,659 monthly. • From FY 2008 to 2009, monthly participation of women, infants, and children decreased from 30,927 to 23,322, while elderly participation decreased from 444,380 to 443,337. Program Participation and Caseload Utilization Each year, to the extent that resources are available, FNS assigns a base caseload to all of the States and ITOs participating in the program. Base caseload equals the greatest of (1) monthly average participation for the previous fiscal year, (2) monthly average participation for the final quarter of the previous fiscal year, or, in certain limited circumstances, (3) participation during September of the previous fiscal year. Base caseload cannot exceed total caseload for the previous year. If resources are available, States may also be eligible to receive additional caseload in the following year, in response to their requests for such caseload and FNS’ determination of the number of slots that States can effectively use. CSFP Average Monthly Participation Participation 1/ 2003 2004 2005 2006 2007 2008 2009 Women l 1,064 11,038 9,180 6,729 5,281 4,792 3,389 Infants 8,131 7,670 6,337 4,482 3,241 2,686 1,593 Children Less than 6 47,071 44,208 36,988 28,815 24,748 23,449 18,340 Total WIC Type 66,266 62,916 52,505 40,026 33,270 30,927 23,322 Elderly 389,392 || 458,798 } 459,929 422,323 432,804 444,380 443,337 Total, CSFP 455,659 521,714 || 512,433 462,349 466,075 475,307 466,659 1/ Based on National Databank version 8.2 data through September FY 2009. Due to rounding, the sum of the average participation by women, infants, children and elderly may not equal the total average participation. 762 30g-57 Free Foods: Under market support authorities, FSA and AMS conduct price-support and surplus-removal procurements of food to aid American agriculture. This food may be donated to FNS, which decides how to allocate them among its programs. If this food can be used in the CSFP food package (e.g., canned green beans but not pudding), FNS may choose to provide it to CSFP. The availability of such food depends entirely on market conditions that cannot be predicted or controlled. To the extent that free food is used in CSFP, the average amount of CSFP appropriations needed to complete each food package is reduced. Thus, free food enables FNS to provide more food packages than could be funded exclusively with CSFP appropriations. Though the volume of free food available to CSFP may vary significantly from year to year, FNS uses historical data to project a certain value of free food per food package that will be available. Bonus Foods: Bonus foods are also purchased to support agricultural markets and donated to FNS, If these foods are compatible with the CSFP food package and FNS decides to provide them as a part of the food package, they are “free” foods, as discussed above. If the donated foods do not meet food package requirements, FNS may decide to offer them to program participants in addition to the food package. Donated foods offered in addition to the food package are called bonus foods. The presence or absence of bonus foods does not affect the number of food packages provided through the program. Administrative Funding Section 4201 of the 2002 Farm Bill (P.L. 107-171) established the method of calculating administrative funds for State agencies in CSFP. State agencies are provided an administrative grant per assigned caseload slot, adjusted each year for inflation. For FY 2009, $66.36 was the legislatively mandated administrative grant per assigned caseload slot. Allowable administrative costs include nutrition education, warehousing, food delivery, participant certification, and other costs associated with State and local administration of the program. The Emergency Food Assistance Program Program Mission The Emergency Food Assistance Program (TEFAP) supplements the diet of needy Americans through donations of nutritious USDA foods to States. States provide the food to focal agencies for distribution to households for home consumption and to organizations that prepare meals for needy people. Recipients of food for home use must meet program eligibility criteria set by the States. USDA also provides TEFAP administrative funding to States to support the storage and distribution of USDA foods and foods from other sources, including private donations. Facts in Brief • TEFAP foods and administrative funds are allocated to States based on a formula that considers the number of unemployed people in each State and the number of persons in each State with incomes below the poverty level. • States may direct their “fair share” of TEFAP foods to: (1) distribution to needy households, (2) provision of meals to the needy at congregate feeding sites, or (3) a combination of the two. • Each State is responsible for selecting organizations to participate in the program, allocating foods and administrative funds among such organizations, and establishing eligibility criteria. Many local TEFAP agencies are faith-based organizations and many depend significantly on volunteers. RECOVERY ACT FUNDING On February 17, 2009, the President signed into law the ARRA (P.L. 111-5). TEFAP received $100 million in ARRA food funding, as well as $50 million in ARRA administrative funding. These funds are being used to help food banks, soup kitchens, and food pantries provide food assistance to the increased 763 30g-58 number of individuals seeking it due to recent economic conditions. Food funds are being used to purchase foods that States order on behalf of their emergency food assistance network. Administrative funds are being used to for allowable State or local costs associated with the distribution of USDA or privately- donated food. States began placing orders for food in March 2009, and the first deliveries began in May of 2009, Deliveries will continue through 2010. - Administrative Funding TEFAP administrative funds are provided to States under the CAP account to help defray State and local costs associated with the transportation, processing, storage and distribution of USDA foods or foods secured from other sources such as the private sector. Unless expressly prohibited by appropriations legislation, a State can also choose to convert TEFAP administrative funds to food funds which are used by USDA to purchase additional USDA foods. States can also use administrative funds to support food rescue activities such as gleaning and other food recovery efforts. In these ways, administrative funds are efficiently leveraged to increase the total flow of food, from all sources, through the TEFAP network. Entitlement Foods Funds for TEFAP food purchases are provided under the SNAP account. A great variety of healthful foods were purchased specifically for distribution in the TEFAP in FY 2009. These included: dehydrated potatoes, frozen ground beef, frozen whole chicken, frozen ham, frozen turkey roast, blackeye beans, great northern beans, light kidney beans, lima beans, pinto beans, egg mix, large eggs, low fat bakery mix, egg noodles, white and yellow corn grits, spaghetti, macaroni, oats, peanut butter, roasted peanuts, rice, whole grain rotini, vegetable oil, ultra-high temperature fluid one percent milk, bran flakes, corn flakes, oat cereal, rice cereal, corn cereal, and corn and rice cereal. The following canned items were also purchased: green beans, blackeye beans, low sodium kidney beans, refried beans, low sodium vegetarian beans, carrots, cream corn, whole kernel corn, peas, sliced potatoes, pumpkin, low sodium spaghetti sauce, spinach, sweet potatoes, tomatoes, diced tomatoes, low sodium tomato sauce, mixed vegetables, reduced sodium tomato soup, reduced sodium vegetable soup, applejuice, cherry applejuice, grape juice, grapefruit juice, orange juice, tomato juice, apricots, applesauce, mixed fruit, freestone and cling peaches, pears, plums, beef, beef Stew, chicken, pork, and tuna. - Bonus Food In FY 2009, USDA purchased USDA foods under its market support authorities for donation to TEFAP. An additional $57.9 million in bonus fruit and vegetable products was delivered to TEFAP outlets under the Food, Conservation, and Energy Act of 2008 (P.L. 101-246, the “2008 Farm Bill”) bringing the total amount of bonus products delivered to TEFAP outlets in FY 2009 to $373.7 million. Bonus USDA foods included: apple products, beans, blueberries, catfish, chicken, lamb, orange juice, milk products, pears, pork, turkey, tomato products, and walnuts. Barter Food Included in the Bonus totals, TEFAP also received USDA foods valued at $47.1 million in FY 2009 . through FSA’s Commodity Credit Corporation (CCC) barter program, this amount included product acquired through a third-party. USDA foods distributed included: canned chicken, canned tuna, and further-processed items. FY 2009 TEFAP Spending In FY 2009, $49,500,000 was appropriated for TEFAP administrative funds, and the Secretary was authorized to make available up to 10 percent of TEFAP food funds to support administrative costs. The FY 2009 appropriation for TEFAP food, which occurs in the SNAP account, was $250 million, the level authorized by Section 42014 of the 2008 Farm Bill. 764 30g-59 TEFAP Summary (Includes ARRA funds) (In millions) . 2003 || 2004 || 2005 || 2006 || 2007 2008 2009 State Administrative Expenses $59.7 $59.2 $58.6 || $63.5 $58.0 $57.1 $88.6 Bonus Foods 242.1 233.0 154,3 67.0 58.2 i 78.1 373.7 Entitlement Foods 130.3 128.5 || 130.5 || 136.1 | 130.6 182.3 || 336.2 TOTAL 433.1 : 421.1 || 344.4 || 267.6 || 246.8 417.5 798.5 The State Administrative Expenses shown in the table above include administrative funds, food funds converted to administrative funds, and administrative funds recovered from the previous year. In FYs 2004-2008, appropriation language permitted the use of up to $10 million of the TEFAP food funding, appropriated under the SNAP account, to provide administrative funds to the States. In all five years, most States opted to convert most or their entire fair share” of these food funds to administrative funds. In FY 2004, $9.3 million was converted; in FY 2005, $8.5 million was converted; in FY 2006, $7.8 million was converted; in FY 2007, $7.8 million was converted; and in FY 2008, $7.7 million was converted. In FY 2009, appropriations language permitted the States the use of up to 10 percent in TEFAP food funds ($25 million) as administrative funds, of which $13.8 million was converted. The balance of the funds was used to purchase foods. The 2008 Farm Bill increased the authorized level of TEFAP entitlement food funds provided under the SNAP account in FY 2009 to $250 million. The amounts shown for entitlement foods in the table above include $100 million provided for TEFAP by the ARRA. They also include administrative funds that States chose to use instead to increase their food entitlements: FY 2001, $0.5 million; FY 2002, $0.6 million; FY 2004, $0.1 million; FY 2006, $0.1 million; FY 2007, $0.1 million; FY 2008, $0.4 million; and FY 2009, $0.02 million. In FY 2003, appropriations legislation prohibited use of administrative funds under the CAP account to increase States' food allocations, and in FY 2005, no States elected to use administrative funds to increase their food entitlements. The 2008 Farm Bill also increased the amount of Section 32 funds available for the purchase of fruits, vegetables and nuts for use in domestic nutrition assistance programs from $200 million to $390 million in FY 2008. For FY 2009, $393 million was available. A significant portion of these funds were allocated for TEFAP food purchases. WIC Farmers’ Market Nutrition Program The WIC Farmers’ Market Nutrition Program (FMNP) provides a direct link between nutrition and the Nation’s small resource farmers by providing women, infants, and children special coupons to purchase and consume fresh local fruits, vegetables and herbs directly from farmers, farmers’ markets and roadside stands. As a result, the FMNP has enhanced local agricultural economies by promoting the development of farmers’ markets, which has increased the customer base for small local farmers and become a major income source. During FY 2009, the FMNP was operated by 45 State agencies and ITOs. In FY 2008, the FMNP provided coupons to 2,297,668 WIC participants. The participants redeemed their coupons at 5,765 authorized Farmers' Markets and roadside stands, providing revenue to 16,016 small family farmers. 765 30g-60 WIC Farmers’ Market Nutrition Program 2005 2006 i4 714 not yet **Farmers' Markets data includes roadside stands. Senior Farmers’ Market Nutrition Program Program Mission The purposes of the Senior Farmers' Market Nutrition Program (SFMNP) are to: (1) provide resources in the form of fresh, nutritious, unprepared, locally grown fruits, vegetables, herbs and honey from farmers' markets, roadside stands and community supported agriculture programs to low-income seniors; (2) increase the domestic consumption of agricultural commodities by expanding or aiding in the expansion of domestic farmers' markets, roadside stands, and community support agriculture programs; and (3) develop or aid in the development of new and additional farmers' markets, roadside stands and community supported agriculture programs. Section 4231 of the 2008 Farm Bill provided $20.6 million annually, from FY 2008 through FY 2012, to operate the SFMNP and added the following new provisions: (1) honey as an eligible food; (2) prohibition of considering the value of SFMNP benefits as income when determining eligibility for other Federal, State or local programs; and (3) prohibition of the collection of State or local sales tax on any purchase of food with SFMNP benefits. FY 2009 Grantees During FY 2009, the SFMNP added 2 new States (Oklahoma and Texas), and operated in a total of 42 States, the District of Columbia, Puerto Rico, and seven Federally-recognized ITOs. The grant funds are used to provide low-income seniors with coupons that can be exchanged for eligible foods at farmers’ markets, roadside stands and community supported agriculture programs. A State agency may spend up to 10 percent of its total SFMNP grant to cover costs associated with the operation and administration of the SFMNP. not yet Pacific Island and Disaster Assistance Program Mission Certain islands in nuclear-affected zones of the Republic of the Marshall Islands received cash-in-lieu of USDA foods and administrative funds. This assistance is authorized by the Compact of Free Association Amendments Act of 2003, (P.L. 108-188). USDA previously provided nutrition assistance under this account to the former Trust Territory of the Pacific Islands; however, as the trust relationship ended for the Federated States of Micronesia, the Republic of Palau, and the Republic of the Marshall Islands, this assistance was phased out. Under its Compact of Free Association, Palau is not eligible to receive emergency assistance. 766 30g-61 The Robert T. Stafford Disaster Relief and Emergency Assistance Act (P.L. 93-288) assigns certain responsibilities relating to disaster food assistance to the Secretary of Agriculture. Other duties have been assigned to the Secretary by Executive Order #12673. These include using, pursuant to the authority of the Act, funds appropriated under Section 32 to purchase USDA foods for assistance in major disasters or emergencies when other food supplies are not readily available. -- Nutrition Services Incentive Program (NSIP) Program Mission The NSIP provides cash and USDA foods to States for distribution to local organizations that prepare nutritionally sound meals served through meals-on-wheels programs or in senior citizen centers and similal settings where the elderly participate in social and rehabilitative activities. The program promotes good health through nutrition assistance and by reducing the isolation experienced by the elderly. In 2003, Congress transferred NSIP funding and the allocation of resources in this program from USDA to DHHS. However, State Agencies on Aging could still choose to receive all or part of their NSIP allotment in the form of USDA foods. They were also permitted to receive bonus food, as available. In 2006, pursuant to P.L. 109-365, Congress rescinded States’ option to receive USDA foods. However, in 2007, this option was reinstated through P.L. 110-19. USDA’s role is to purchase and deliver food to States that elect to receive it. DHHS provides funding to USDA for purchases of USDA foods and related administrative expenses. FNS and DHHS' Administration on Aging enter into annual agreements to ensure the effective provision of USDA foods to State Agencies on Aging. Surplus USDA Foods for Charitable Institutions and Summer Camps Program Mission Charitable institutions and summer camps are eligible to receive bonus USDA foods, as available. These are provided through price-support and surplus removal authority to a wide variety of institutions serving needy persons. Charitable institutions and summer camps do not receive USDA foods through specific program appropriations. - Facts in Brief • Under Section 416 price support and Section 32 surplus removal authorities, USDA foods are acquired by the CCC and AMS and are made available at no cost to a variety of institutional types, including nonprofit charitable institutions serving needy persons and summer camps for children, among many others. - • To be eligible, an institution must be nonprofit, tax-exempt under the Internal Revenue Code, and serve meals on a regular basis. Among the charitable institutions eligible to receive USDA Foods are: homes for the elderly, hospitals that offer general and long term health care, soup kitchens, meals-on- wheels programs, and schools, service institutions, or nonresidential child care institutions that do not participate in any of the Child Nutrition Programs. - • Due to favorable market conditions, bonus USDA foods were not available to charitable institutions and summer camps in FY 2009. 767 30g-62 FOOD AND NUTRiTION SERVICE COMMODITY SUPPLEMENTAL FOOD PROGRAM Quantity and Value of Commoditles Fiscal Year 2009. Fº|TLEMENT COMMODITIES Pourids Dollars SECTION 6/32 TYPE: - APPLE JUICE, CANNED . 18,956,794 $7,808,841 APPLESAUCE, CANNED 2,518,543 1,535,252 APRICOTS, CANNED 692,550 457,519 BEANS, CANNED 1,173,480 577,791 BEANS, DRY - 5,720,640 2,953,670 BEANS, GREEN CANNED 4,109,019 2,133,284 BEEF CHILI, No BEAN, CANNED 1,224,000 1,876,807 BEEF STEW, CHUNKY 2,399,940 2,264,458 BEEF, CANNED 1,578,600 3,799,027 CARROTS, CANNED - 3,181,502 1,984,849. CHiCKEN, CANNED BONED 1,383,752 2,819,387 CORN, CANNED WHOLE KERNEL 4,266,506 2,134,611 FRUIT, MIXED CANNED - 2,999,590 2,030,042 GRAPE J - 14,538,937 8,403,474 ORANGE JUICE, CANNED 13,135,567 5,254,921 PEACHES, CANNED 3,102,732 2,254,617 PEARS, CANNED 2,175,304 1,614,140 PEAS, CANNED 3,111,079 1,860,910 PLUMS, CANNED 182,250 118,778. , POTATOES, CANNED 918,000 489,636 SALMON, CANNED 769,950 1,334,979 SPINACH, CANNED - 998,235 596,718 SWEET POTATOES, CANNED 1,233,677 758,699 TOMATO JUICE, CANNED 4,358,444 1,551,390 TOMATOES, CANNED 1,067,605 490,205 TUNA, CANNED 1,489,230 2,945,799. VEG MIX CANNED 2,845,578 1,643,677 Total Section 6/32 Type 100,131,504 $61,693,481 ENTITi_EMENT COMMODITIES Pounds Bollars SECTION 416 TYPE: - CEREAL, DRY CORN 2,599,260 $3,399,188 CEREAL, DRY CORN & RICE 1,532,972 2,533,847 CEREAL, DRY OATS 1,048,494 2,043,572 CEREAL, DRY RICE . 1,205,292 1,732,826 CEREAL, INFANT RICE 16,640 55,911 CEREAL, WB FLAKES 1,787,728 2,880,619 CHEESE, REDUCED FAT 10,850,400 15,252,487 FARINA 1,319,472 767,588 FORMULA, NFANT 155,521 1,653,189 GRITS, CORN 771,120 191,030 MACARON 3,732,600 1,824,789 MilK, EVAPORATED 15,459,120 7,639,510 OATS, ROLLED 2,001,600 711,959 PEANUT BUTTER 4,254,458 3,850,628 RICE, MILLED 4,626,000 1,598,292 ROTIN, WHOLE GRAIN 204,000 96.382 SPAGHETTI 3,290,400 1,228,694 Total Section 416 Type 54,855,077 $47,460,511 Anticipated Adjustment $23,994,786 AMS / FSA / PCIMS Admin. Expenses - 895,246 TOTAL COMMODITY ENTITLEMENT 154,986,581 $134,044,024 768 30g-63 FOOD AND NUTRITION SERVICE comMoDITY SUPPLEMENTAL Food PROGRAM (cont.) Quantity and value of Commoditles Fiscal Year 2009 Bonus commodities Pounds Dollars SECTION 32 TYPE: ORANGE JUICE 4,855,202 $1,853,980 Total Section 32 Type 4,855,202 $1,853,980 |BONUs commoDTES Pounds . Dollars SECTION 416 TYPE: iMSTANT 2 . 5,066,109 $7,092,553 Total Section 416 Type 5,066,109 $755,555- Anticipated Adjustment --- 0 () TOTAL BONUS COMMODITIES 9,921,341 $8,946,533 TOTAL -- ALL COMMODITIES 754.507,557 $777.555,557- Adjustment - Q Cash in-Lieu of Commodities 0 GRAND TOTAL 164,907,892 $142,990,557 Source: PCiMS – Devery order and contract information. 769 30g-64 comMopmy SUPPLEMENTAL FOOD PROGRAM PROJECTS, PARTICIPATION AND FOOD COST STATE OR - --- TERRITORY COST IN of Columbia---------- bake, Minriësota. 1,481,761 2,007 Hampshire Mexico—— York Carolina Pakota Carolina Ulakota Sioux, S.D. 1,150.841 Admin. Exp. SOURCE: FPRS FNS-153 data - Food distributed to participants in fiscal year 2009. if Total value of FNS funded entitlement foods. Costs do not include free commodities, bonus commodities, food losses, storage and transportation for certain items (Group A fruits and vegetables, all Group B commodities), or the value of food used for nutrition education. - 2/ Total outlays and unliquidated obligations. 31 Totals may not add due to rounding. . . NOTE: These data are based in part on preliminary reports submitted by State and local agencies and are subject to change as revisions are received. 770 30g-65 FGO'ſ) ARD Nºrff;CR SERVICE THE EMERGENCY FOOD ANO ASSASTANCE PROGRAM Quantity and Value of Commodities - Figtai Ygar 2009 º º jº º COMMOp!Tiěš Pounds Iłółłars Pºids Doitats tºº ſº Lºº- º SECTION 532 fºr º APPLE JUICE, CANNED 5,422.654 $2,240,578 G {} APPLESAUCE, CANNED 8,002.030 4,627,405 5,576,860: $3,275,643 APRHCOTS HALVES, CANNED 933,762 648,032 g {} BEANS REFRić0, CANNEC 2,974,320 j,598,338 {} . {} BEANS VEGETARAN, CANNED 3,235,320 1,576,201 0 {} BEANS, B. iiMA2 555,600 437,036 Ú {} BEANS, BLKEY: 4,192,919 2,481,283 0. {} BEANS, GREEN CANNED 12,142.185 6,277,359 {} {} BEANS, GR3 MORTH 2. 1,935,360 $68,683 Q Q#" BEANS, Kłońſſy 5,250,575 2,736,102 {} {} BEANS, Pinſo 9,333,320 4,370,334 {} {} BEEF STEW, CANNED 16,428,050 $5,451,878 Q 0. BEEF, CANNED 2,633,400 6,457,819 4,008,000 2,314,079 BEEF, GROUND 4,850,000 8,372.429 {} {} CARROTS, CANNED 8,646,068 4,431,808 Ö {} CHERRY APPLE JUICE 3, tit,364 1,612,899 0. {} CH3CKEN, CANNED 2.520,016 5.841,933 {} º CH!CKEN, CUT UP 57,600 53,367 {} J CHCKEN, WHOLE 12,672,000 9,172,825 7,326,000 5,344,467 CORN, CANNED CREAM: 2,879,558 1,566,220 {} {} CORhi, CANNEE KERNEL 14,555,262 7,332,210 {} 0 CRANBERRY APPLE Júlòt 1,144,743 539,838 {} {} EGG MIX 360,000 878,219 {} {} EGGS #5 (XCZ 2.426,250 1,541,458 2,767,509 t,573,037 GRAPE J 2.5iS,615 3,534,792 Ú {} GRAPEFRUIT JUICE 486, id 2 171,941 {} Q HAM 2,880,000 4,t23,672 6,760,000; 12,173,976 MIXED FRûT, CARNED 9,747,377 6,462,578 3,098,254 2,233.879 ORANGE JUICE, CANNED 6,317,827 2,544,059 {} G PEACHES, CANNED 8,226,508 5,582,767 it,440,370 9,707,762 PEARS, CANNE) 7.331,883 5,460,333 {} , 0. PEAS, CANNED 6,777,580 4,053,837 O {} FORK, CANNED & 3,204,000 6,668,674 9,792,000. 19,295,592. FOTA foº:S, DEHY 32 1,680,000 2,508,010 () {} POTATOES, St. iCED 2,093,040 i, #25.305 Q {} PUMPKłºw, CANNED 984,458 704,779 {} {} RA/SifyS 38,880 4},{}44 Q Ö SALMON, CANNEE 8,550 16,006 0 G SPAGHºff I SAt RCE. CANNED 11,846,288 5,273,577 {} g SPINAC++, CANNED 4,021,385 2,373,373 O {} SWEET POTATOES, CANNED 2,449.807 4,511,489 0. {} TOMATO JujiGE, CANNED 2,873,311 3,022,437 Ú {} TOMATO SAUCE, CANNEO 3.683,482 4,604,266 {} {j TOMATO SOUP 3,050,856 2,132,646 {} #3 TOMATOES, CANNED 5,603,251 2,646.034 {} {} Tühlá, CANNED 5,379,576 10,443,446 G {} TURKEY ROASTS 3,400,000 5,005,998 6,400,000; $2,411,564 VEGET fººt ºf ºx 8.643.258 4,980,678 {} Ö VEGE'ſ ABLE SOUP 5,569,585 4.525.454 {} O Total Section 632 Type zººl $170,729,986 54,168,98 $37,575 # COMMOE.}}TIES Potºnds Đokiars SECTION 4 #6 TYPE * - {SEREAi., CORN 4,203,552 $5,484.446 {} {} CEREAt , CORN & RičE 1,135,890 1.819,697 g Ø CERäAt , GATS 529,622 1,040,467 {} {} cEREAil, RICE 2,443,596 3,099,709 {} d CEREAt , WB FLAk£S 736,372 1,154,140 {} {} {X}{EESE MOZZ {} {} 4,202,255; $2,241,945 {CHEESE REE}{JCEO {} {} 9,028,800; i3,994,357 EGG NCCD; $S 3,903,960 2,795,964 {j O EVAP 24 $10,156 55,488 0 0. FLGłJR Mix, LOW FAf 2,694,726 2,403,003 d Đ FORMijià CRY 972 ić,332 Q {} §RºS 5,055,420 1,333,886; {} º MACARCNE 5,429,525 4,135,338 Ü {} MilK, UHT Fluit, 1% 45,247,799 S.261,038 0 {} {}ATS 5,364,285 t,875,813 {} {} PEANty'ſ BUTTER 12,636,035 14,403,353: 32,752,651 12,213,553 PEANUTS, ROASTED 129,600 233,256 1,296,000 2,048,900 RíCE 26,064,000 3,946,447 (j {} ROTiNi, WHOt.E GRAiN 2,686,000 1,459,424 {} # SPAGHETT; $5,428,400 5,628,879 {} {} VEGETABLE Ött. 3,825,788 _2,097,227 - Ö —% fotal Section 415 Type $16,263,394 ãzāāśāīzāśā Anticipated fransportation/misc âr $255,355 Cash in-listſ of Corrirradities • CNM} $40,618 º AMSIFSA/PCIMS/Computer Support $,432,493 Anticipated Adjustment - v ſºlº ENIHL:MENT 3.337; 771 30g-66 Food and nutrmion service THE EMERGENCY FOOD AND ASSISTANCE PROGRAM (Coºt.) Quantity artd Value of Commodities Figgai Yegºr 2009 E. {`OMMODITIES Pounds Doñars } SECTION 32C TYPE*: - APPLE JUICE 10,495,824 $4,283,257 APPLESAUCE 12,174,348 7,209,990 APRICOTS, CANNED 6,597, 4,698,582 BëANS 71,428,101 35,775,456 Bi UEBERRIES 18,445,872 20,942,531 CARROTS 5,977,810 3,790,593 CATFISH STRIPS 600,000 2,050,558 CHERRES 2,336,400 2,330,102 CHERRY APPLE JUICE 2,820,303 1,638,462 CHiCKEN: 40,235,520 31,029,191 CHCKEN CANNED 5,437,517 10,780,519 GRAPE J 3,963,682. 2.495,837 iAMB LEG ROAST r 288,00 948,943 LAMB SHOULDER CHOPS 648,000 2,362,464 ORANGE JUICE 57,344,423: . 22,539,060 PEAS, CANNED 5,467,515 3,228,409 PCRK, CANNED 15,444,00 29,464,935 PORK, PATTY FC 30,514,00 56,933,070 POTATO PRODUCTS 5,910,48 3,972,755 SPAGHETTI SAJCE 5,103,014 2,250, #42 TOMATO JUICE 1,181,433 408,438 TQMATO SAUCE 4,303,131. 1,846,894 TºàTCHES 6,880,000 4,471,659 TOMATOES, CANNED 704,70t 369,121 TUNA 6,253,200 12,973,872 TüRKEY BREAST 3,496,000 5,310,440 TURKEY DEL; 11,588,000 20,027,622 TÜRKEY ROASTS 4,840,000 6,131,215 WALNAH'S 10,850,112 22,910,065 Total Section 32C Type 351,325,869|| $323,872,984 BONUS COMMODITIES Pounds Döläfs SECTION 416 TYPE*: łNSTANT 2 PB SMTH UHT Młł K Total Section 436 Type Anticipated Adjustment OTAL BONUS COMMOD;TiES TOTAL-ALL COMMODITIES Entitlernent ARRA Bonus 32C Anticipated Adjustment GRAND TOTAL Source: PCIMS - Delivery order and contract information. Note: Entitlement figures include ARRA funds, Bonus Figures include Farm Bill and Barter/Seam Procurements. Commodity Entitlement funds include $20,000 made available from TEFAP Administrative funds 772 30g-6? FOOD AND NUTRETION SERVICE THE EMERGENCY FOOD ASSISTANCE PROGRAM Administrative Funds ! Entitiament and Bonus Commodities Fiscal Year 2009 TEFAF Admir, ARRA HEFAP i Total Admint. Funds tº Adjaja Fundº Fund:; $797 $1,497 1, Entitièment Coinmodities 423, ARRA Commodities 1,053, Bonus tºommodities” $6,557 7,306, Total Admin. and Food 2, 97 Source: PCMS - Delivery order and contract information. * Figures include Farm, Biš and &arterſSean Procurements. tº TEFAP SNAP commodity funds made available as administrative funds $13,802.194 2. TEFAP CAP administrative funds made availabis as commodity funds $20,000. 3 Totals may riot add do to rounding 1,374, 4.i.4. 4,137, t,496, 3,583. 297 1,456, 1,295, 14,291, 5,467 1,347 9,101, 9, 24,957. #4, 54,906, 4,345, t4,900, 13,747 1,498, 439, 17 5,792, * 3. 32,037, 773 wic FARMERS MARKET NUTRITION PROGRAM 30g-68 PARTICIPATION AND PROGRAM FINANCING FSCAL YEAR 2008 and 2009 Fiscal Year 2008 - - TOTAL PARTICIPATION 1/ Fiscal Year 08 # Fiscal Year 09 STATE OR - - - - PROGRAM | PROGRAM TERRITORY WOMEN |NFANTS I CHILDREN TOTAL . GRANT GRANT Alabama— 8,631 0. 22,716 31,347 $380,323 $392,164 Alaska 4,629 889 9,587 15,105 217,707 224,485 Arizona 4,901 0 8,520 13,421 227,694 234,783 Arkansas 8,635 0 13,988 22,623 183,906 189,832 California—- 117,461 55,268 268,625 441,354 2,325,395 2,397,794 Connecticut 13,320 O 37,908 51,228 307,672 317,251 Bistrict of Columbia—i 6,405 0 8,975 15,380 292,205 301,302 Florida- - 11,047 199 20,593 31,839 275,143 283,709 Georgia- 9,190 3,017 15,773 27,980 982,769 1,013,366 illinois 15,143 0 27,260 42,403 375,321 387,006 indiana- 9,417 6,075 14,884 30,376 246,517 254,192. Howa— 3,260 O 26,376 29,636 481,400 496,388 kentucky-- 4,520 739 10,040 15,299 217,685 224,462 Louisian 244 8 193 445 6,667 6,667 |Maine 1,570 0 5,030 6,600 75,000 || 75,000 Maryland -*. 27,356 0 24,256 51,612 331,032 341,338 Massachusetts 35,349 1 66,780 102,130 455,810 470,001 Michigan- 6,895 258 16,299 23,452 386,948 398,995 Minnesota 16,065 5,085 35,079 56,229 297,754 307,024 Mississippi 2ſ 3,030 74 5,323 8,427 89,500 89,500 Missouri 3,677 933 4,356 8,966 227,972 235,070 *Montana 1,806 O 3,519 5,325 57,353 57,353 New Hampshire 4,512 1,393 9,295 15,200 104,373 107,623 New Jersey {} 0 48,228 48,228 1,190,823 1,227,898 New Mexico 2f 4,283 || 272 r 7,847 12,402 309,922 319,104 Mew York 111,501. 90,351 158,175 360,027 3,342,131 3,446,188 North Carolina 10,834 0 7,604 18,438 274,336 282,877 Ohio 8,844 0 23,239 32,083 504,646 520,358 Oklahoma Chickasaw— 810 319 1,825 2,954 75,000 75,000 Oklahoma Osage Tribe— 409 351 985 1,745 31,325 31,325 Oregon 6,489 3,475 16,817 26,781 354,678 365,721 Pennsylvania 45,496 0 96,680 142,476 1,735,773 1,789,814 Puerto Rico- 18,868 8,206 50,526 77,600 1,751,703 1,806,240 Rhode island 4,965 0 13,307 18,272 147,723 152,322 South Carolina— 3,670 O 6,616 10,286 124,784 128,669 £nneşSee O 0 O Q 75,000 75,000 Texas— †- 77,720 0 160,190 237,910 1,238,556 1,277,117 Vermont 732 108 1,924 2,764 75,000 75,000 Virginia 11,111 0 23,584 34,695 291,212 Ú Washington- 37,616 {} 75,094 112,710 570,486 588,247 West Virginia 2,936 0 6,237 9,173 70,000 70,000 Wisconsin 32,620 O 65,298 97,918 599,993 618,873 Guarn 1,493 0 3,636 5,129 92.671 95,556 Undistributed {} () 0 O {} 0. TOTAL 697,460 177,021 1,423,187 2,297,668 $21,401,908_$21,750,214 if Participation data reflects Fiscal Year 2008. Participation data 2 includes Indian Tribal Organizations. for Fiscal Year 2009 is not due until February 2010. NOTE: These data are based in part on preliminary data submitted by State and local agencies and are subject to change as revised reports are received. Totals may not add due to rounding. 774 30g-69 FOOD AND NUTRITION SERVICE Disaster Assistance and Disaster Feeding Quantity and Value of Commodities Fiscal Year 2009 | £isaster Feedin ENTITLEMENT COMMODETIES Pounds Dollars SECTION 6/32 TYPE: Apple Slices 444 $182 Applesauce - 598 189 Beef Products 1,419 2,387 Blackberries 257 232 Corn 504 206 Eggs 358 - 289 Mixed Fruit 782 341 Pears - 552 243 Salsa 598 199 Tomato Sauce . 444 100 Total Section 6/32 Type 5,895 $4,367 prº-º-º-º-º-º-º- ENTITLEMENT COMMOD THES Pounds Dollars SECTION 416 TYPE: - - Rice 305 $96 Cheese . . 852 1,676 Rotini 278 121 Milk, UHT 2% 512 264 Total Section 416 Type Tºº? $2757- Anticipated Transp. & Storage $6,870 DOD Regional Pilot 0 AMS IFSA ſpołMS #Comp. Supp Ö Anticipated Adjustment 6,870 TOTAL COMMODITY ENTITLEMENT 7,842 $13,395 NONE AL BONUS COMMODíTES Anticipated Adjustment GRAND TOTAL Source: PCMS - Delivery order and contract information, 775 30g-70 Food AND NUTRItion service DisastER Assistance & DisastER FEEDING - value of commodities to States Entitlement and Bonus Fiscal Year 2009 State or Territory - Entitlement Bonus Total Affat {} O (; Alaska $6,524 Ó $6,524 Ariz {) {} (3 A --A {) `ſ} 0. California............................... {) Ö (3 Cºifºrnfän {} {} {} C aº 0. {} {} Del {) {} {} District of Columbia................ {} G {} Fiorida {} G {} Georgi {) G {} Hawaii {} G {} frighn {) G Q illinois {) O Q iridiaria Q G O iowa.... {} Ú {} ** {} G Q kentucky {} {} {} f {} O O AMaine {} {} {} Maryland - {} C. Q iMassachusetts....................... o Ö D Michig {} Q {} * is {} {} 0. * * r {} 0 {} * † {} 0 Q iſ a tº {} () 0. * +1. {} ... G {} Nevad {} D {} New Hampshire.......... {} {} G New Jersey............................ {} Q G New Mexico............ }* * * * * * * : * * * * * * * 0. {} 0. Mew York............................. {} {} 0. North Carolina..................... * * * {} . {} {} North Dakota........................ {} {} {} Öhit, {} {} {} fºkia? {} Ø {} Gregon {} {} {} p y t] {} Q Rhode island........................... () Q {} #South Carolina....................... {j 0. {} South Dakota.......... * * * * * * * * * * * * * {} {} {} T O 6 G Texas................... {). {} {} titah {} : {} Q Vermont O {} {} Virginia ................................ {} {} {} Washingt . 0. {} . {} West Virginia......................... 0 {} {} Wł * . Q O {} Wyoming ū {} {} American Samoa................... O {} 0. Fed Micronesia (chuuk)......... $ tº * {} {} t; Guzarr; . {} {} . {} Northern Mariana island............ {} (3 () Puerto Rico........................... {} {} ſº Trust Territory.............., “.....” {} {} 0. Virgin Islands......................... o {} . {} indian Tribes Set Asi............... Q {} {} Indian Tribes........ # * * * * * * * * * * * * * * * * * O {} {} Freely Associated States......... Q {} {} DOP Army f AF....................., (? () 0. AMS j FSA | PC##$............., G {} {) Undistributed ū {) {} Estimated Transportatiºſºft\Wisc.,, 5,879. {} 8,870 TOTAl-.................................. $13,395 {} $43,395 Source: PCMS - Delivery order and contract information, Eagle Alaska food-FY of event 2009, FY10 funds. 776 30g-71 FOOD AND NUTRITION SERVICE NUTRITION SERVICES INCENTIVE PROGRAM Quantity and Value of Commodities Total Section 32 Type Fiscal Year 2009 |ENTTLEMENT commodifies Pouncis Dollars SECTIONER,275E - 3EANS GREEN 116,412 $52,574 BEEF BONE ESS FR COMBO 40,000 61,178 BEEF, 40 245,600 410,832 CATFISH STRIPS 40, ºù 162,200 CHICKEN, CHLièD BULK 216,000 168,728 CH3CKEN, CUT-UP FROZEN 80,000 63,348 CHICKEN, DICED 40,000 77,492 CHICKEN, FAJITA 39,000 71.431 CORN, FRZ 82,200 33,582 FRUIT MIX 36,253 27,389 HAM, FRZ 60,000 94,075 PEACHES, CLiNG CANNED 229,437 139,393 PEACHES, CUP 44,880 39,167 PEARS, CANNED 36,024 24,746 PEAS, FROZEN 86,760 46,590 PORK ROAST 120,000 134,637 STRAWBERRIES 85,500 82,60? SWEET POTATOES 2,025 917 TOMATO SAUCE 40,227 14,106 TOMATOES, DICED CANNED 69,768 29,172 TURKEY, ROASTS FROZEN 120,000 143,868 Total Section 6/32 Type 1,830,026 $7575.577- |ENTITLEMENT commodmes Pounds Dollars SECTION 416 TYPE: CHEDDAR SHRED 2,400 $3,428 CHEESE BARREL 40,000 57,389 Fl_OUR 42,840 8,898 WHOLE GRAIN MACARON: 4,000 523 WHOLE GRA}N ROTIN: 1,000 508 WHOLE GRAN SPAGHETTI 1,000 435 Totai Section 416 Type 88,240 $71,481 Anticipated Adjustment $340,570 AMS t FSA 1 PCiMS Admin. Expenses º 8,615 TOTAL COMMOD)'ſ Y ENTITLEMENT 1,948,266 $2,298,390 |BONUs commobiTIES Pounds Dollars ºsmºs lºgº SECTION, 32 TYPE: NONE 0 O NONE otai Section 416 Type Anticipated Adjustment At BONüJS COMMODITIES Cash in-Lieu of Commodities GRAND TOTAL 777 30g-72 FOOD AND NUTRITION SERVICE NUTRITION SERVICES INCENTIVE PROGRAM Value of Commodities to States Entitlement and Bonus Fiscal Year 2009 State or Territory Entitlement *º†*es $114,568 º 31,077 119,947 273,110 w ****sº*:-ººjºs*gewº* 1,069,879 1,069,879 165,355 175,269 ºtº*sºagº.*esºſº**se**-***tºrº&*We*sº**g*s*ºtº**-*.*** &*wº*tº**º*wººsº&*-*gtºre*tººsº**wº&*gswº * Tribes Set * Associated * sº * º * ve * sº º * & gº? º * ge “ºf ise gº * es wº s wº sº º tº * tº * 8,61 5 8,615 $2,298,390 778 30-78 FOOD AND NUTRITION SERVICE The estimate includes appropriation language for this item as follows (new language underscored): Nutrition Programs Administration: For necessary administrative expenses of the Food and Nutrition Service for carrying out any domestic nutrition assistance program, [$147,801,000) $172,087,000: Provided $3,000,000 shall be used for the purposes of section 4404 of Public Law 107-171, as amended by section 4401 of Public Law 110-246. This change in language provides funding for the Hunger Fellows Program. 779 30-79 FOOD AND NUTRITION SERVICE LEAD-OFF TABULAR STATEMENT AND SUMMARY OF INCREASES AND DECREASES NUTRITION PROGRAMs ADMINISTRATION Appropriations Act, 2010 3. -. :..................S.147,801,000 Budget Estimate, 2011.............................. - ... 172,087,000 increase in Appropriation w is s a º ºf 4 º º …+24,286,000 Adjustments in 2010: - - Appropriations Act, 2010............................................................... $147,801,000 Congressional Hunger Center........................... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,000,000 Adjusted base for 2010 - - - - - - - ... $150,801,000 Budget Estimate, Current Law 2011 -----...-- 172,087,000 Increase over adjusted 2010........ ...+21,286,000 SUMMARY OF INCREASES AND DECREASES (On basis of adjusted appropriation) 2010 Program 201 | Item of Change Estimated Pay Costs Changes Estimated Direct Program, FNS and CNPP “ $147,801,000) $1,616,000 O; $149,417,000 Congressional Hunger Center 3,000,000 () Ö 3,000,000 Investment in Improved Program Administration {} {} $5,170,000 5,170,000 Financial Management Systems Modernization {} 0 3,500,000 3,500,000 Develop and Promote Dietary Guidance 0 {} 9,000,000 9,000,000 IT Modernization & Support 0 __0}_2,000,000] 2,000,000 Total Appropriation 150,801,000; 1,616,000 19,670,000; 172,087,000 aſ The FY 2010 estimate for the administrative expenses of the Center for Nutrition Policy and Promotion is $3,913,000; the FY 2011 request is $12,913,000. - - 780 30-80 PROJECT STATEMENT (On basis of adjusted appropriation) 2009 2010 Increase or 20 I 1 — Project Actual SY Budget L SY Decrease Estimated SY Food and Nutrition Service/CNPP $141,991,236; 1,005; $147,801,000 1,077; $21,286,000 $169,087,000 1.27 Congressional Hunger Center 2,347,000 - 3,000,000 0 3,000,000 | Congressional Relations : 290,000 0| 0 0. | Miscellaneous Reimbursements 906,973 0. 0. () Balance Lapsing 603,764— 0 0. 0 Total Obligations 146,138,973; 1,005] 150,801,000 1,077 21,286,000 172,087,000 EE7 Transfer from Congressional Relations -290,000 {} Rescission . () . Transfer from Miscellaneous Reimbursements -906,973 . . . . Total Appropriation 144,942,000 1,005 Administrative Expenses Breakout by FNS Programs (This is an informational display linking administrative funding and program activities.) FY 2011 FNS Prºgram |Supplemental Nutrition Asiance Program . - $81,210,000 Child Nutrition Programs - 39,044,000l Special Supplemental Nutrition Program for women, Infants, 21,864,000 and Children (WIC) Commodity Assistance Program 14,056,000 Subtotal 156,174,000 Congressional Hunger Center 3,000,000 Center for Nutrition Policy and Promotion - 12,913,000 Total Request, Nutrition Programs Administration rºº Justification of Increases and Decreases A net increase of $2 1,286,000 for the Nutrition Assistance Programs ($150,801,000 available in FY 2010) consisting of: (1) An increase of $1,616,000 to fund increased pay costs. Explanation of change The requested increase for pay costs will fund personnel costs generated by pay raises approved by the President. 781 (2) (3) (4) (5) 30–8] An increase of $5,170,000 and 40 staff years to enhance resources to meet FNS' core responsibilities of program administration, grantee oversight and protection of the integrity of program operations. Explanation of Change. This funding will increase staff focused on implementing programs in a way that improves access to nutrition assistance, advances the public trust and enhances the nutritional quality of the nutrition assistance programs. This increase is consistent with FNS’ leading role in Administration priorities including ending childhood hunger and combating obesity. (For additional information, see page 30-82.) - FNS requests $3,500,000 to modernize its financial management systems. Explanation of Change. FNS must upgrade and integrate its outdated financial management system in accordance with Departmental requirements for the Financial Management Modernization Initiative (FMMI) and the Office of Management and Budget's Line of Business initiative to develop common business processes and systems for financial management. FNS relies heavily on this software to control $80 billion in Federal appropriations and must now align itself with the Departmental FMMI plan to ensure that the agency is able to maintain the integrity of its financial accounts. (For additional information, see page 30-83.) An increase of $9,000,000 and 10 staff years for the Center for Nutrition Policy and Promotion for nutrition education activities and to promote the 2010 Dietary Guidelines for Americans and for nutrition curriculum development, Explanation of Change. The funding requested by the Center for Nutrition Policy and Promotion (CNPP) will be used to continue implementing the scientific evidence-based approach to nutrition guidance, promote the 2010 Dietary Guidelines for Americans to ensure that nutrition education has the greatest impact on diet quality, perform evidence-based systematic review of nutrition education research to guide effective nutrition education interventions in schools and communities, and build and maintain educational tools and systems that Americans can use to adopt behaviors that lead to more healthful eating and active lifestyles. These initiatives will help make a significant contribution to USDA's goal to help Americans develop eating behaviors that are more consistent with the Dietary Guidelines for Americans CNPP will use foundational work in research, policy development and promotion to build cutting edge systems that will result in positive consumer behavior changes regarding dietary practices and active lifestyles to help reduce the obesity epidemic, reduce incidences of diet-related chronic diseases, and improve the overall health of Americans. (For additional information, see page 30-84.) An increase of $2,000,000 for IT modernization and support associated with the NPA account, Explanation of Change. Funding will provide a dedicated source of funding to support FNS" internal computer infrastructure, This initiative will improve the security of FNS computer operations in order to make the agency less vulnerable to cyber attacks, faulty data, and disruptions in service. It will also support technology tools that can improve benefit delivery to program participants, to streamline program administration for our State and local partners, to improve nutrition education and to enhance program integrity and stewardship of Federal resources. (For additional information, see page 30-86.) - 782 Program: Proposal: Rationale: Goal: Budget Impact: ($ in millions) 30-82 FNCS PRESIDENT'S BUDGET FISCAL YEAR 2011 CURRENT LAW Nutrition Programs Administration – Investment in Improved Program Administration FNS requests funding to increase staff focused on implementing programs in a way that improves access to nutrition assistance, advances the public trust and enhances the nutritional quality of the nutrition assistance programs. The President and the Secretary have established an aggressive set of policy goals for the Food, Nutrition and Consumer Services (FNCS) mission area, FNS plays key roles in achieving those objectives. The budget requests additional staff to support recent growth in the size and complexity of nutrition programs to enhance the agency’s ability to successfully achieve the Administration's goals, undertake important new initiatives, and maintain the high levels of program integrity and fiscal stewardship essential to preserving public confidence in and support for the nutrition assistance programs. Requested increases will support investments in key areas including: Policy and Regulatory Development. The Administration has set an extraordinarily ambitious and high-profile policy agenda for nutrition programs. FNS is seeking to use Child Nutrition/WIC reauthorization to lead the government in ending childhood hunger and reverse the trends of increasing obesity among our children. The agency must implement Institute of Medicine recommendations to reform school meals standards within two years, and is also focused on completing prompt implementation of 2008 Farm Bill regulations while preparing for the next legislative cycle. Additional resources are needed to ensure that USDA is fully responsive with high-quality policy and regulatory work to meet these goals. . Program Monitoring and Oversight. Robust Federal oversight, monitoring, and technical assistance are essential to the identification, prevention and resolution of problems before they grow into crises, and impact clients. The school meals programs are currently incurring high levels of erroneous payments, and the Administration is seeking strong action to reduce them across government. Additional resources would be used to provide stronger oversight, and earlier intervention and technical assistance to address these problems. - Program Evaluation and Analysis. Because of the emphasis on nutrition assistance program reform and innovation, Congress and the Administration have worked together to secure a massive increase in program demonstration and evaluation funding – over $150 million in 2010. This is a fivefold increase over last year, and includes such high- profile projects as the Summer Feeding Demonstration Programs, the Recovery Act- funded SNAP evaluation, and the Healthy Incentives Pilot. No new staff resources have been provided to support the design and development of these studies to ensure that they yield the rigorous evidence required by policymakers. Additional resources are needed to ensure maximum value is derived from this substantial investment in research and development. USDA Strategic Goal: Ensure that all of America's children have access to safe, nutritious, and balanced meals. +. - FY 2011 Budget Authority $5.17 783 Program: Proposal: Rationale: Goal: Budget Impact: ($ in millions) 30–83. FNCS PRESIDENT'S BUDGET FISCAL YEAR 2011 CURRENT LAW Nutrition Programs Administration – Financial Management Systems Modernization FNS requests finding to upgrade and integrate its outdated program financial management system in accordance with Departmental requirements for its Financial Management Modernization Initiative (FMMI) and its ongoing efforts to develop common business processes and systems for financial management. FNS' Integrated Program Accounting System (IPAS) is not part of the current USDA financial system. The IPAS is the agency's primary mission critical financial system for FNS that was implemented in May 2001 using BearingPoint Performance Series client server software developed in 2000. This software was Joint Financial Management Improve Program (JFMIP) certified at that time and was offered through the mandatory General Services Administration (GSA) Financial Management Systems Software (FMSS) Multiple Award Schedule for use by Federal agencies. BearingPoint no longer markets this suite of financial management software and the software is no longer on the approved list of JFMIP financial management software. FNS’s current release of the software is the last approved version that BearingPoint will directly support and it is nearing the end point of its useful life. FNS relies heavily on this software to control over $80 billion in Federal appropriations and must now align itself with the Departmental FMMI plan to ensure that the agency is able to maintain the integrity of its financial accounts and maintain compliance with all Federal financial requirements. Without an upgraded system, FNS will not be able to comply with the requirements of FMMI. - - Since IPAS 1) is one of the primary mission area financial management subsystems within USDA, 2) supports all the program and grant funding and accounting requirements for the agency’s SNAP and Special Nutrition Programs, and 3) is subject to annual financial statement audits, FNS must now take action to integrate its financial management processes directly with USDA's FMMI in order to ensure that an uninterrupted flow of funding will be available to its grantees. Based on the requirements imposed on FNS by USDA FMMI and the critical need to ensure the integrity of the flow of Federal funds to agency grantees, FNS proposes to begin the process to integrating its financial management system with the Departmental FMM}. - - USDA Strategic Goal: Ensure that all of America’s children have access to safe, nutritious, and balanced meals. FY 2011 Budget Authority $3.5 784 Program: Proposal: Rationale: will result in positive consumer behavior regarding dietary practices and active lifestyles 30-84 FNCS PRESIDENT’S BUDGET FISCAL YEAR 2011 CURRENT LAW Nutrition Programs Administration - Develop and Promote Cutting-Edge Evidence-Based Dietary Guidance That (1) Encourages Americans to Adopt Better Behaviors for Healthful Eating and Active Lifestyles, and (2) Makes Nutrition Education More Effective. - - The Center for Nutrition Policy and Promotion (CNPP) is requesting $9,000,000 and 10 staff years in FY 2011 to (1) continue implementing the scientific evidence-based approach to nutrition guidance, (2) promote the 2010 Dietary Guidelines for Americans to ensure that nutrition education has the greatest impact on diet quality, (3) perform evidence-based systematic review of nutrition education research to guide effective nutrition education interventions in schools and communities, and (4) build and maintain educational tools and systems that Americans can use to adopt behaviors that lead to mor healthful eating and active lifestyles. - The funding requested will help CNPP make a significant contribution to USDA’s goal tc help Americans in general and children in particular develop eating behaviors that are more consistent with the Dietary Guidelines for Americans. CNPP will use foundational work in research, policy development, and promotion to build cutting-edge systems that to help reduce the obesity epidemic, reduce incidences of diet-related chronic diseases, and improve the overall health of Americans. - - - Nutrition Evidence Library ($1,000,000) - Recommendations of the Dietary Guidelines Advisory Committee (DGAC) are developed using a transparent, systematic review process guided by the Nutrition Evidence Library (NEL) personnel. This process includes searching, selecting, critically evaluating, synthesizing and grading scientific evidence and posting the evidence for public view in the USDA's NEL. The Guidelines in turn support Federal nutrition policy and educational curriculum and tools. Subsequen to supporting the work of the DGAC, the Evidence Analysis Library, in which the NEL is located, will review scientific (basic), applied, and consumer research to answer policy- based questions about diet, health, education, and nutrition-related behaviors. Thus, CNPP will: - • Continue to populate the Evidence Analysis Library with evidence analyses that answer specific policy questions and provide an evidence-base for food, nutrition, and nutrition education practice decisions, as well as organize a robust topic nomination process and expert involvement in systematic reviews. • Publicize results of evidence analysis projects through in-person, in-print and a variety of electronically-based media and educational formats. • Increase staffing to support increased demands of Evidence Analysis Library development. - 2010 Dietary Guidelines for Americans ($2,000,000) - Every 5 years, an expert DGAC recommends revisions of the Dietary Guidelines for Americans to the Secretaries of USDA and DHHS. After review of these recommendations, the Departments issue a policy document, as well as information consumers can use to establish healthful diets and active lifestyles. To translate the recommendations and policy statements into information that consumers can use, CNPP will: • Conduct research on promising strategies to positively influence consumer eating behavior and to evaluate the effectiveness of strategies for delivery of nutrition 785 Goal: Budget Impact: ($ in millions) 30-85 education in multiple settings and for diverse audiences of varied socio-economic levels. - • Implement a communications plan for the 2010 Dietary Guidelines for Americans to increase the visibility, reach, and adoption of Guidelines recommendations in all population segments. • Increase staffing to support research and implementation of the 2010 Dietary Guidelines for Americans, - MyPyramid Food Guidance System ($4,000,000) - The MyPyramid graphic is USDA's symbol for healthful diets and active lifestyles for Americans. And MyPyramid.gov is the USDA’s major e-government nutrition education connection with consumers who are seeking sound, scientifically based advice on ways to eat healthfully and “move more.” To enhance MyPyramid materials and tools, CNPP will: • Conduct technical research to continue updating and developing the underlying food intake patterns for the food guidance system, including access to up-to-date food composition and consumption data and conduct research on use and effectiveness of MyPyramid materials and interactive tools. - • Develop enhanced interactive tools for MyPyramid.gov with components and functionalities that are most promising as drivers of behavioral change fostered through school and community-based nutrition education. • Conduct consumer research to evaluate the potential of specific recommendations and delivery systems to result in improved dietary intakes and physical activity levels among diverse audiences, at all socio-economic levels. • Provide for sufficient hardware and software capability to support increasing use of MyPyramid.gov tools and applications. - • Increase staffing to support development and testing of enhanced personalized, interactive, and targeted applications and tools, and customer support. Making Nutrition Education More Effective ($2,000,000) - Nutrition education is a core part of increasing children’s awareness of the importance of eating healthfully and exercising to maintain healthy weight and prevent diet-related illnesses. To support attainment of the USDA's Goal 4, CNPP will: • Conduct systematic evidence-based reviews of nutrition education research on designing classroom instruction and methods of evaluation to guide making nutrition education in schools more effective. • Enhance MyPyramid Food Guidance System tools that give parents and family nutrition gatekeepers information to help them and children make better food choices. - • Increase the materials distributed through various channels to the general public, schools, and agencies that serve children and their families. • Increase the efforts reported through the State Nutrition Action Council (SNAC), producing a clearinghouse on cross-cutting nutrition education topics, projects, and materials focused on meeting the nutrition needs of children and families. • Increase staffing to support development and use of nutrition education efforts in the schools. - - - USDA Strategic Goal: Ensure that all of America's children have access to safe, nutritious, and balanced meals. FY 2011 Budget Authority $9.0 786 Program: Proposal: Rationale: 30-86 |FNCS PRESIDENT'S BUDGET FISCAL YEAR 2011 CURRENT LAW Nutrition Programs Administration - IT Modernization and Support Funding will support expanded use of technology tools to improve benefit delivery to program participants, to streamline program administration for State and local program partners, to improve nutrition education and to enhance program integrity and our stewardship of Federal resources. FNS does not have a dedicated source of funding to support its internal computer infrastructure requirements. This limits FNS’ ability to adequately plan for security Goal: Budget Impact: ($ in millions) upgrades, perform needed computer maintenance, and maintain the high level of computer operation required to support ongoing program operations. FNS needs to ensure that it has the resources necessary to support the programmatic systems critical to the delivery of its nutrition assistance. The funding requested would yield many positive results. It will directly support improved computer security, computer operations, improved customer service, and most significantly support for program operations and service delivery of our benefits. Increasing programmatic demands for information technology services may not be able to be supported under our existing infrastructure. FNS is also increasingly being targeted for cyber attack and must ensure the integrity of its computer operations and program delivery. The agency works in close collaboration with the Department’s Office of the Chief Information Officer (OCIO) to ensure that common standards and practices are in place; however, dedicated agency resources are also needed to support ongoing infrastructure needs. An outdated infrastructure makes the agency more vulnerable to attack which could lead to program delivery disruptions. USDA Strategic Goal: Ensure that all of America’s children have access to safe, nutritious, and balanced meals. FY 2011 Budget Authority $2.0 787 30-87 Food and Nutrition Service GEO KDOWN 0 BLEGA NS AN -YEAR 2009 and Estimated 2010 and 2011 AL łł Totals may riot add due to rounding. 788 30-88 FOOD AND NUTRITION SERVICE Nutrition Programs Administration Classification by Objects 2009 Actual and Estimated 2010 and 20) ) (in thousands of dollars) Personnel Compensation: 2009 2010 2011 Washington D.C. - $41,199 $45,080 $48,125 Field 48,363 52,920 56,495 ll Total personnel compensation 89,562 98,000 104,620 12|Personnel benefits 22,105 22,440 23,770 13||Benefits for former personnel 24 24 27 Total personnel compensation and benefits ! I I,691 120,464 128,417 Other Objects: 2] Travel and transportation of persons 2,245 2,245 2,245 22|Transportation of things | | # I | | 23.1 Rental payments to GSA 32 32 32 23.2}Rental payments to others 537 537 537 23.3}Communications, utilities, and misc. charges 1,935 1,700 1,700 24|Printing and reproduction - 300 300 300 25i Other Services . 0 {} () 25.1|Contractual Services Performed by Other Federal Agencies 3,890 3,890 3,890 25.2|Related Expenditures - 0 {} {) 25.3|Repair, Alteration or Maintenance of Equipment, Furniture or Structures • * | 84 | 84 429 25.4 Contractual Services - Other 13,901 11,981. 23,069 25.5|Agreements 3,436 3,436 3,436 25.6|ADP Services and Supplies 1,422 1,422 1,422 25.7Miscellaneous Services 68 68 68 25 s[Fees 56 56 56 26}Supplies and materials 1,485 1,285 1,285 3} Equipment I,905 100 2,100 32}land and structures } {} 0 4) Grants, subsidies and contributions 2,347 3,000 3,000 42i}nsurance claims and indemnities 83 83 83 43|Interest and dividends 7 7 7 45|Special Payments {} {} 0 92. Undistributed 603 0 0 Total other objects 34,448 30,337 43,670 Total direct obligations 146,139 150,801 172,087 789 30g-73 NUTRITION PROGRAMS ADMINISTRATION STATUs of progRAM The Nutrition Programs Administration (NPA) appropriation funds operating expenses for administering e nutrition assistance programs of FNS, It also includes the budget of the Center for Nutrition Policy and romotion (CNPP). *NS Administrative Resources — A Critical Program Management and Oversight Tool NS employees play a central role in managing the Federal nutrition assistance programs. While the rograms operate in partnership with State agencies and local service providers, FNS is solely responsible Or: - Developing program policies and regulations to ensure program design and operation are consistent with the law and current nutrition science; Disbursing and accounting for Federal funds provided to those who operate the programs; and | Monitoring program operations and conducting oversight, technical assistance and evaluation to ensure that programs are managed and operated consistent with law, and to maximize their effectiveness and value to clients and taxpayers. - Meeting these responsibilities is central to accomplishing core program objectives, including ensuring |ccess to benefits for eligible individuals, improving the nutrition of program recipients, and strengthening ºrogram integrity. The Child Nutrition and WIC Reauthorization Act of 2004 resulted in new management ind oversight responsibilities in several areas including program expansion activities (e.g., the SFSP and CACFP eligibility pilots); the expansion of the “Simplified Summer Program” and the FFVP; activities elated to healthier eating (e.g., school wellness); and improvements in program integrity in the Child Nutrition Programs. Ongoing efforts to improve SNAP payment accuracy, CACFP management, WIC rendor cost containment, and school meals certification accuracy are critical to the agency’s mission and equire intensive staff focus and travel funding. hile substantial funding is also provided to States to operate these programs, State agencies have ndamentally different financial incentives than the Federal Government. In many areas, the cost of rogram problems or inefficiencies affects Federal expenditures, while the cost to resolve them has an pact on the States. Therefore, strong Federal policy and oversight are fundamental to ensuring effective vels of program accountability. - Although information technology improvements have resulted in large productivity gains in the past lecade, many of FNS’ functions are labor-intensive and require ongoing attention. Since the NPA ppropriation funds most of the salaries and administrative expenses of FNS, it is integral to ensuring and everaging the effective use of other program appropriations. Over the last two decades, FNS staff levels ave decreased by about fifty percent, a particularly significant reduction considering the growing iduciary responsibilities of the agency and the increasing complexity of the programs it administers. The eduction in staff has occurred while FNS Federal nutrition assistance programs have increased in size, umber, and complexity and new legislation has increased workload. Administrative funding for FNS ccounts for about 9% of 1 percent of the total investment in nutrition assistance. Especially in the context f limited resources, increasing this investment in proper fiscal and program management for an agency anaging approximately $100 billion including ARRA funding must be a top priority. e most significant accomplishments under this NPA appropriation during FY 2009 are cited below by rogram and activity. 790 30g-74 SUPPLEMENTAL, NUTRITION ASSISTANCE PROGRAM In SNAP, formerly known as the Food Stamp Program, NPA funding is used for a range of critically important functions, FNS develops policies and procedures for the administration of the program, provides State agency oversight to ensure compliance with program rules, and provides technical assistance to States. The agency also reviews State quality control activities, determines the effectiveness and efficiency of State administration, and reviews and approves planning documents for computer system acquisitions and electronic benefit transfer issuance systems. FNS authorizes and monitors 193,753 retail and wholesale firms that are approved to accept SNAP benefits, and maintains fiscal accountability for SNAP benefits. It also allocates employment and training funds to the States. Highlights of FY 2009 accomplishments supported by the NPA appropriation and related to SNAP include: Implementation of Farm Bill Changes: The Food, Energy and Conservation Act of 2008 (the Farm Bill) included multiple provisions that reinforce long-term agency priorities. These include: strengthening integrity; simplifying administration; maintaining State flexibility; improving health through nutrition education; and improving access. FNS has been responsible for ensuring the effective and efficient implementation of these changes, State Oversight: FNS, through its seven Regional Offices, conducts various on-site reviews of State and local SNAP offices each year. In FY 2009, FNS continued to perform Management Evaluation System Reviews (MEs) which are designed to cover national program priorities and known vulnerable areas. Program Access Reviews, a major component of MEs, were also conducted at the State and local levels. FNS encourages States to consider ways to increase efficiencies in and the effectiveness of their program administration and operations. FNS continues to share promising practices and provide State exchange funds to facilitate State and local agency travel to observe innovative practices which may be transferable. FNS also works with an increasing number of State agencies that are contemplating large-scale changes to their business models for delivering social services. FNS provides technical assistance and performs strong oversight of States to ensure that their modernization projects and other innovations are implemented in a successful manner to deliver program benefits more effectively and efficiently, using fewer resources without sacrificing customer service, program access or program integrity. Improving Benefit Delivery: FNS made important advances in promoting the nutrition benefits of SNAP to eligible people through nutrition education efforts and a national outreach effort. Furthermore, in response to changes in the Farm Bill, the agency worked hard to ensure that new SNAP provisions are well-understood and correctly implemented. Improving Program Integrity: FNS made important advances in its efforts to improve payment accuracy and retailer integrity. - • Payment Accuracy: The program payment error rate for FY 2008 was 5.01 percent, representing the fifth consecutive year that the payment error rate is under 6 percent. The rate reflects an over-issuance rate of 4.01 percent and an under-issuance rate of 1.00 percent. To maintain this trend in FY 2009, FNS continued an aggressive payment accuracy improvement program that balanced the need to maintain program access. - • Recipient Claims: State agencies collected about $259.6 million in recipient claims in FY 2009, the most recent year for which final figures are available. FNS continued to monitor corrective actions performed by States to address previously identified deficiencies in recipient claims systems. Forty- four States had claims systems without significant problems as of April 2009. 791 30g-75 • Store Tracking and Redemption System (STARS): FNS re-engineered retailer administration functions to ensure effective use of staff and financial resources through use of automation. This initiative included re-design of the retailer re-authorization process to collect updated store data online that is fed through an automated system that evaluates each retailer's response and risk level to flag firms for further scrutiny, - • Anti-fraud Locator using EBT Retailer Transactions (ALERT): FNS awarded a contract to build a next generation ALERT system to add new analytical capabilities, integrate a GIS solution, and incorporate data mining activities in order to significantly improve program integrity. • Retailer Oversight and Integrity: In FY 2009, FNS staff authorized or reauthorized 55,891 firms to participate in SNAP, FNS utilized contractor store visits to verify the initial or continued eligibility of 38,218 stores participating in SNAP. In this same period, 15,878 firms were withdrawn from participation because of changes in ownership, business closings, or nonconformance with authorization criteria. In addition, 1,459 stores were fined or disqualified temporarily or permanently for noncompliance with law or SNAP regulations. At the end of FY 2009, 193,753 stores were authorized to participate in SNAP, an increase of 18,659 stores from FY 2008 and of 31,740 stores over the last three fiscal years. During FY 2009, there were investigations of 4,234 stores nationwide. Approximately 35 percent (1,467) of these investigations documented evidence of SNAP violations. Of the 1,467 positive investigations, FNS investigators uncovered trafficking in 225 stores. Electronic Benefit Transfer (EBT) Systems: FNS continues oversight of States as their EBT contracts end and they procure subsequent EBT systems through the Request for Proposal (RFP) process. This process includes RFP approvals, contract approvals, as well as oversight of State conversions from one EBT vendor's system to a new vendor's system. Food DISTRIBUTION PROGRAM ON INDIAN RESERVATIONS (FDPIR) Through the FDPIR, FNS acquires and distributes USDA Foods to participating Indian Tribal Organizations (ITOs) and State agencies for distribution to low-income persons and families. Cash assistance also is provided to the ITOS/State agencies to help finance the administrative cost of operating the program. FNS sets standards for participant and provider eligibility and provides training and other assistance to program partners as needed. Highlights of FY 2009 accomplishments supported by the NPA appropriation and related to the FDPIR include: - Food Package Review: FNS continued its commitment to improve the food package offered under FDPIR by partnering with the National Association of Food Distribution Programs on Indian Reservations. A work group, representing program directors, Federal partners, nutritionists, and USDA food procurement specialists, is focusing on ways to better meet the nutritional needs and food preferences of program participants. In the current review cycle, the panel seeks to reduce saturated fat, sugar, and sodium in the food package and explore “healthier” alternatives to some current products. The work group continues to explore ways to increase the convenience and acceptability of products offered and adjusts pack sizes/guide rates to better meet the needs of one-person households. Improved Customer Service: FNS continues to implement a comprehensive plan to significantly improve customer service and program efficiency by expanding the use of long-term, indefinite delivery/indefinite quantity contracting and request for proposal contracting. This will help to ensure constant availability of desired USDA foods and reduce costs. 792 30g-76 CHILD NUTRITION PROGRAMS In the Child Nutrition Programs, the NPA appropriation funds the staff expenses for developing policies, procedures and standards used to administer the programs and determine eligibility, and providing Federal oversight to ensure that the programs are operating effectively and in compliance with law and regulations FNS is improving access and accuracy in the school meals programs by mandated direct certification of children in SNAP households and by enhancing the verification process for those who must continue to complete paper applications to participate. In addition, provisions to simplify the application process for families will allow more eligible children to benefit from nutritious school meals. In areas where the State agencies cannot or do not assume operational responsibility, FNS directly administers the Child Nutrition Programs. - Highlights of FY 2009 accomplishments supported by the NPA appropriation related to the Child Nutritio Programs include: - Child Nutrition Reauthorization: In FY 2009, FNS continued implementation of the Child Nutrition an WIC Reauthorization Act of 2004. Congress is expected to use the upcoming Child Nutrition Programs reauthorization as an opportunity to consider improvements to the USDA Child Nutrition Programs, including the NSLP and the SBP. USDA is committed to a strong reauthorization bill that improves program access, enhances meal quality and the school nutrition environment and improves program performance. FNS is working with Congress to ensure that the Administration’s goals are part of the Child Nutrition Programs reauthorization process. • Regulations - Publication of Regulations in the Federal Register in FY 2009, including: School Food Safety Inspections Marketing and Sale of Fluid Milk in Schools School Breakfast Programs Severe Need Assistance - *. Verification of Eligibility for Free and Reduced Price Meals in the NSLP and SBP : Nutrition Awareness: Team Nutrition's goal is to improve children's lifelong eating and physical activity habits by using the principles of the Dietary Guidelines for Americans and MyPyramid. It strives to instill healthy behaviors in children to prevent nutrition-related health problems, including obesity, diabetes, and other nutrition related illnesses. Team Nutrition complements the President’s efforts to confront the obesity epidemic and to improve the nutrition and health of all Americans. • MyPyramid for Kids and MyPyramid for Preschoolers: During FY 2009, Team Nutrition continued tº distribute MyPyramid for Kids materials to educate elementary school age children on the MyPyramid food guidance system. Team Nutrition also developed and distributed several materials for parents and caregivers of preschool age children that provide strategies for helping young children develop healthy eating habits that last a lifetime and educate parents about age-appropriate foods and physical activities for preschool age children. - • HealthierUS School Challenge: The HealthierUS School Challenge recognizes Team Nutrition Schools that demonstrate a commitment to the health and well being of their students, and supports the President’s goal to improve the health and well being of all Americans. Recently, FNS expanded the HealthierUS School Challenge to also recognize middle and high schools that take specific steps to improve their nutrition and physical activity environments. Previously, the voluntary challenge recognized only elementary schools that met rigorous criteria for the nutritional content of their school meals and provided nutrition and physical education as well as other opportunities for physical activity to students. To date, USDA has recognized over 600 elementary schools at one of four levels of superior performance: Bronze, Silver, Gold, and Gold of Distinction. 793 30g-77 SPECIAL SUPPLEMENTAL NUTRITION PROGRAM FOR WOMEN, INFANTS, AND CHILDREN (WIC) NPA funds the Federal administration of the WIC Program. FNS uses these funds to manage the allocation if grant resources to State Departments of Health and others to support program operations. NPA also upports the development of policies, procedures, and standards used in administering the program, and º of State agency operations to ensure program effectiveness and compliance with law and egulation. - - * of FY 2009 accomplishments supported by the NPA appropriation and related to the WIC Program include: - Revitalizing Quality WIC Nutrition Services: FNS made important advances in improving nutrition :ducation services in the program. - WICSpecial Project Grants - FNS awarded Special Project Grants to three WIC State agencies in FY 2009 to pursue innovative projects that revitalize quality nutrition services. The grants will focus on improving breastfeeding rates and fruit and vegetable consumption among WIC participants. • Breastfeeding Promotion and Support Activities –In an effort to ensure that all local agency WIC staff are equipped with the necessary skills to successfully promote and support breastfeeding among WIC participants, FNS developed the competency-based breastfeeding training curriculum, “Using Loving Support to Grow and Glow in WIC: Breastfeeding Training for Local WIC Staff" and provided training in a “Train-the-Trainer” format for key WIC State agency staff in each FNS region in FY 2009. - * WIC Works Resource System - FNS, in partnership with the National Agricultural Library, continues to expand the WIC Works Resource System, which provides electronic nutrition information and resources to State and local WIC staff and provides opportunities for WIC staff to share State- developed materials and earn continuing education credits through online education. - National Maternal Nutrition Intensive Course: Improving staff development, competencies, and retention are a priority of the WIC Program. Since FY 2000, WIC has provided funding for the University of Minnesota to conduct the annual National Maternal Nutrition Intensive Course. The course offers in- service training for WIC State and local agency staff to increase knowledge and improve skills needed to deliver quality nutrition services to pregnant and postpartum women. In recent years, WIC has provided funding to add an enhanced distance learning component to the course, enabling greater numbers of WIC taff from around the country to participate. This course provides one of the few opportunities for WIC taff to receive science-based training to increase their technical skills. ocusing Nutrition Assessment and Education: FNS continued work with the National WIC Association on the joint Value Enhanced Nutrition Assessment in WIC (VENA) workgroup. The VENA initiative is a response to the IOM Report, Dietary Risk Assessment in the WIC Program, published in 2002, which determined that traditional dietary assessment protocols do not identify nutritional inadequacies for individuals with sufficient precision to target enhanced services. VENA Policy and Guidance (developed with the assistance of a joint workgroup of FNS and National WIC Association representatives) was sent to all WIC State agencies in February 2006. The Guidance identifies nutrition sessment staff competencies and methods to enhance the delivery of individualized nutrition education nd counseling. As of the start of FY 2010, all WIC State agencies have implemented VENA. State gencies will provide ongoing training to local agency staffs to ensure compliance with VENA. n FY 2009, FNS awarded Recovery Act funds to nine States (Alabama, Colorado, Delaware, the District f Columbia, Illinois, Missouri, Montana, Oregon, and Pennsylvania) to conduct EBT planning activities. n addition, Wisconsin received funds to augment planning activities that began in FY 2008. Virginia also 794 30g-78 received funds for their EBT initiative, which has evolved into a joint planning project with West Virginia. Fourteen State agencies have been funded to date for EBT planning purposes: Enhancing Program Management and Oversight: In an effort to improve the management evaluation process, FNS completed a revision of the State Technical Assistance Review guidance. Expanding Services to the Military: FNS continued to provide assistance to the Department of Defense in administering its WIC-like Overseas Program. In early FY 2010, FNS implemented the legislative provision contained in the Consolidated Appropriations Act for 2010 (Public Law 111–80) to exclude from WIC income eligibility determination calculations all combat-related payments made to service members and/or their households. - Vendor Cost Containment: FNS continued to work with State agencies to ensure their vendor cost containment systems comply with the vendor cost containment provisions of the Child Nutrition and WIC Reauthorization Act of 2004. commodity Assistance PROGRAM The NPA appropriation funds the staff administrative expenses of the Commodity Assistance Program (CAP). In addition to providing commodities, also known as USDA foods, for the Child Nutrition Programs, FNS makes nutritious foods available to State agencies for distribution to low-income people through the Commodity Supplemental Food Program (CSFP) and The Emergency Food Assistance Program (TEFAP), and administrative resources to States to support the distribution of these commodities. The agency also provides USDA foods to four nuclear-affected Pacific islands and delivers food-based relief to the victims of disasters. A range of management initiatives that improved operations in the CAP programs during FY 2009 are described under “Acquisition and Distribution of USDA Foods” in the Child Nutrition Programs section. Special USDA Foods Initiatives: FNS continues to work closely with its partners and customers, such as schools and industry, and with its three sister agencies within USDA-FSA, AMS, and FSIS – to improve service to its customers, streamline operations, and maintain support for American agriculture. Highlights of FNS’s most recent efforts in this area include: • Processed Commodity Information Management System (PCIMS) Replacement - PCIMS is a mission- critical system that USDA relies on to buy, inventory, manage, and deliver USDA foods to customers. PCIMS is currently used and supported by FNS, AMS, and FSA. Initiation of the PCIMS replacement system project, known as Web-Based Supply Chain Management (WBSCM) began in FY 2006. The WBSCM contract was awarded in early FY 2007. In FY 2008, FNS participated in system design sessions and initiated system development activity and in FY 2009, system development continued and testing began. Testing and training will continue throughout FY 2010. - • USDA Foods Communication Initiative - FNS is in the second year of the USDA Foods Communication Initiative to support USDA nutrition assistance programs by improving the public perception of USDA foods. Through the initiative, FNS intends to increase stakeholder and public awareness of how USDA foods contribute to meeting the Dietary Guidelines for Americans, support local wellness policies, and are high quality, healthy options benefiting schools and other recipients. Additionally, this initiative will help program managers understand the significant improvements that have been made to USDA foods, and how to best use them to the benefit of program participants. - - - Food Safety: In FY 2009, FNS continued to enhance food safety initiatives in support of USDA's goal of “Promoting Healthier Eating Habits and Lifestyles”. Major initiatives were related to both food defense and food safety, and complemented the food safety education activities described under the Child Nutrition Programs section. 795 30g-79 Liaison Work with Other Federal Food Safety Partners: FNS provided technical support for the FSIS 2010 Food Safety Education Conference planned for March 2010 in Atlanta, Georgia. FNS worked with the Office of Homeland Security to update the Sector Specific Plan and to participate on an Interagency Work Group with the Department of Homeland Security's Office of Health Affairs. FNS coordinated with the Centers for Disease Control and Prevention to conduct a workgroup to discuss food allergy management in schools. FNS also participated on the Department of Health and Human Services’ committee to formulate the food safety components of Healthy People 2020. Liaison Work with Other Food Safety Partners: FNS worked with the National Education Association Health Information Network to produce a norovirus prevention resource for schools. FNS coordinated with the School Nutrition Association (SNA) to provide several Webinars on food allergy management for school meals programs operators. FNS provided a grant to the National Environmental Health Association to promote food-safe schools to their target audience of health inspectors, who often conduct the food safety inspections at schools. FNS worked with SNA and the Food Allergy and Anaphylaxis Network to conduct a work group on food allergy management. The agency also works with NFSMI on food safety education and training for Child Nutrition Programs nationwide. CROSS-PROGRAM NUTRITION INITIATIVES Federal nutrition assistance programs are designed to work together to form a nutrition safety net that promotes access to food and improved nutrition for the children and low-income people they serve. While FNS activities support the effective administration of each program individually, many of our Idministrative efforts are designed to improve coordination across programs to achieve goals and outcomes hat they share, including promoting healthy eating and active living behaviors among those eligible to articipate in Federal nutrition assistance programs. To assist States in advancing this critical part of the S mission, the agency develops guidance materials and policy documents; nutrition education resources, aining and implementation support. The agency also disseminates knowledge and new information about ffective strategies and other activities, and works with nutrition-focused public and private entities to oordinate and promote nutrition education for the FNS target populations. S also encourages and provide resources to facilitate across programs collaboration and consistent pplication of nutrition knowledge in agency policy, regulations, guidance and technical assistance. For xample, the agency disseminated a set of core nutrition messages supporting content and provided training nd guidance use of these messages in the FNS programs. The messages are designed to help low-income others and children meet the 2005 Dietary Guidelines for Americans and establish child feeding practices hat support the development of healthy eating habits. WIC, schools and child care programs across the ountry are now using these consumer-tested messages to support nutrition education activities. They can e easily integrated into educational activities, campaigns, materials and communication tools, and have een incorporated into MyPyramid guidance for preschool children. S supports and coordinates nutrition-related committees on behalf of Departmental leadership, and erves in leadership and liaison roles for a number of internal/external organizations, including working 1th DHHS on Healthy People 2020 Objectives, participating in the National Physical Activity Plan, ational More Matters Fruit and Vegetable partnership and many others, FINANCIAL MANAGEMENT INITIATIVES FNS continues to provide needed technical assistance to States which are renegotiating contracts for the :ontinuation of EBT services. The Account Management Agent (AMA) system/EBT has successfully rolled out its Web-based platform. Enhancements to the software are now under development. AMA release 4.0 upgrades will augment some 3f the reporting capabilities, increase the awareness of system issues by providing automated notifications 3f these issues, automate some of the current manual processes, and provide better communication to users hrough broadcast messages on the AMA.gov Web page. 796 30g-80 The AMA was developed by FNS as a payment authorization and account management interface for the United States Department of Treasury's Automated Standard Application for Payments (ASAP) system. Both systems reside at the Federal Reserve Bank of Richmond and are integrated into one seamless process. The AMA's purpose is to manage the ASAP SNAP accounts for FNS in support of their EBT process, which utilizes electronic debit cards. The debit cards carry a SNAP benefits balance reduced by the amount of purchases when swiped by the retailer. The retailer is subsequently reimbursed by the State's EBT contractor. A historic record of States’ Monthly Funding Limits is in place to provide for better funding estimates. This is monitored regularly by the Program Reports Analysis and Monitoring branch. Accounting and Financial Tracking Improvements FNS continues to maintain its strong record of financial management oversight. FNS implemented update to the Standard General Ledger and Financial Statements mandated for FY 2009. Debt Collection Activity in FY 2009 For Federally managed Federal debt, FNS continued its vigorous pursuit of debt owed the agency by billing $43 million in new receivables during the fiscal year. Year-end outstanding debts for the FY increased from the previous year by $61 million. The overall debt resolution rate achieved was about. 50 percent. . Federally Managed Federal Debt Profile FY 2007–FY 2009 ($ millions) bººm 2007 2008 2009 ategory Accounts Receivable $55 $58 $39 Collections - 28 41 43 Litigation - 15 } 2 Past due 16 15 7 Recipient Claims 18] 208 288 In its accounts receivable, FNS also records the Federal “share” of the value of recipient overpayments established by SNAP State agencies. State agencies are allowed to retain a portion of the claims collected. The receivable consists of the total claims established less the States' share. For Federal Debts managed by SNAP State agencies, such agencies establish claims against households fo errors in issuing program benefits to these households. These overpayments can result from the client's incorrect reporting of household circumstances, through client fraud, or by State administrative error. SNAP Recipient Claims Activity FY 2007 – FY 2009 ($ Millions) §laims Activity 2007 2008 2009 Claims $232 $254 $276 Established - Claims 180 225 217 Collected Ending Balance 1,192 1,198 1,209 * Figures provided on the FNS-209 are preliminary and subject to change, 797 30g-81 inancial Management (FM) Regional Office Reviews e FM organization conducted five self-assessments of regional offices during FY 2009 with the jective of ensuring the propriety of financial operations and transactions within FNS. These reviews ave been instrumental in raising the confidence level of management officials within the agency over the ast several fiscal years. - 'inancial Management Reviews (FMRs) addition to the reviews that HQ staff conduct of the regional offices, the regions also conduct FMRs of articipating State agencies and ITOs to obtain reasonable assurance that the financial information reported y such grantees is correct and complete and in compliance with Federal standards and regulations. For Ys 2009 and 2010, FNS plans to increase the scope and numbers of FMRs conducted to specifically rget the reviews to meet the oversight and transparency requirements of the ARRA. FNS’s goal is to onduct on-site reviews and/or desk audits for half of the State agencies and ITOs receiving Recovery Act nds in all programs by the end of FY 2010. inancial Statements Audit S received an unqualified (“clean”) opinion on the FY 2009/2008 Financial Statements, meaning that e agency met the highest auditing standards. While FNS was able to provide reasonable assurance lating to internal controls, financial reporting and financial systems for FY 2009, the agency has reached critical point regarding necessary administrative resources. - ADMINISTRATIVE MANAGEMENT INITIATIVES uman Capital Management FY 2009, FNS continued to focus on strategic management of human capital – the Federal overnment’s most important and valuable asset -- with emphases on employee development, decreasing kill gaps, workforce planning, performance management, diversity, and organizational efficiency: FNS University (FNSU) - Nearly 900 training opportunities were available to FNS employees through one- and 1-1/2 day learning labs and seminars offered at the National Office and in all Regional Offices. The labs for 2009 were based upon the results of the agency's 2006 Foundation of Continual Learning skill gap analysis. In addition to the learning labs, FNSU training opportunities include the Field Academy, the Leadership Institute, the Tuition Reimbursement Program, and the Supervisory Excellence Program. Administered the 2009 Foundation of Continual Learning (FOCL) skill gap assessment. This survey, administered every three years, is used to develop the major portion of the FNSU corporate training program. For the 2009 iteration, the survey was changed to measure OPM's 28 leadership competencies. The curriculum for FNSU in 2010, 2011, and 2012 will reflect the competencies with the greatest proficiency gap as measured by the survey. Field Academy – Over 50 field office employees attended the seventh annual Field Academy, which included courses on problem-solving, stress tolerance, interpersonal skills, communication skills, records management, FOIA responsibilities, and the importance of protecting “Sensitive but Unclassified” information. Leadership Institute - FNS’ intensive 16 month program is designed to build leadership skills for selected GS/GM 11-14 employees. This program is the agency's primary succession planning tool. In FY 2009, a comprehensive review of the program and its curriculum was undertaken by a team of program graduates. Enhancements will be implemented in January of 2010, when the Class of 2011 will be inducted. 798 30g-82 • Supervisory Excellence Program (SEP) - In 2009, a new SEP 2-day seminar was developed and piloted to good participants reviews. The seminar, “Supervision by the Book”, is a comprehensive review of a broad range of supervisory topics which will be presented agencywide in FY 2010 for remedial purposes, and then on a regular basis after that. Also in 2009, the very successful Human Resources Management for New FNS Supervisors seminar was held. Nearly 30 new supervisors attended. In addition, in 2009 a monthly series of short training sessions, mandatory for all supervisors and managers, were implemented on a selection of timely topics, such as performance management, position descriptions, and labor management issues. . • Tuition Reimbursement Program (TRP) - This program provides reimbursement for employees who successfully complete dean-approved courses on their own time and at their own expense. Course tuition is reimbursed at the rate of 75 percent, up to a yearly $2,000. Processed over 90 TRP applications in 2009. Approximately 76 applications were approved and a total of $44,354 in reimbursements have been disbursed to date, • FNSU-101 (New Employee Orientation): In 2009, made major improvements to the FNSU new employee onboarding process for full implementation in 2010, including: v Contact is made with supervisors of new employees well before onboarding day, and they ar provided a comprehensive checklist of the things they need to do for and with their new employees in the days, weeks, and month after they arrive. - Y New employees now meet with the Administrator and four Associate Administrators on thei first day. V New employees now receive an in-depth tour of the FNS Intranet, including Employee Personal Page, FNS University, ARC Web-site/Contacts, E-Forms, E-Library, Shuttle Schedule, Parking, Occupant Emergency Plan, TSP Web-site, OPM Web-site, amongst others. V New employees now receive a building tour of the FNCS facilities, including places to eat, health unit, fitness center, mailroom, parking — Patty Gross, supply room, conference rooms, credit union, IT Help Desk, break room, Breastfeeding Mothers' Room, Union Office, FNS Library, Civil Rights, and Administrators Suite. V New employees receive a briefing on Records Management, which is being coordinated wit the Regional Offices via videoteleconference (VTC), Additional briefings will be added to this segment of the on-boarding, which will bring the activities up to a full-day in length. • Implemented a Web-based Exit Interview system, so that data can be collected on the factors leading to the departure of employees. The data will be used by management to increase retention and the quality of work life. - - Procurement Outreach to Small and Disadvantaged Business In FY 2009, FNS continued its long-standing emphasis on procurement from small and disadvantaged businesses. The agency exceeded all but two of its procurement goals for FY 2009, including 49.5 percen of all contract spending awarded to small businesses and exceeding the 8(a) award goal by 8 percent. FN also held two very successful small business roundtable sessions including one specifically for Informatio Technology. - Information Technology and Egovernment In FY 2009, FNCS completed the consolidation of our network structure and implemented virtualization i our server environment. These upgrades improved the management and control of our network and systems and provided the agency with significant cost savings and potential for future cost avoidance. FNS continues to work to upgrade its information security program incorporating new security tools and practices that strengthen our operations, complying with the Federal Information Security Management Ac requirements. We implemented an agency-wide, two-factor authentication solution for remote access to our network, enabling agency users to securely access network systems, effectively expanding the potentia use of telework and improving the disaster recovery capabilities of the agency. 799 30g-83 CENTER for NUTRITION Policy AND ProMotion - Program Mission . The U.S. Department of Agriculture is the lead Federal agency in human nutrition, charged with providing research-based human nutrition guidance, education and outreach to all American consumers, as well as scientifically guided nutrition assistance programs. The mission of the Center for Nutrition Policy and Promotion (CNPP), the focal nutrition policy agency in USDA, is to improve the health of Americans by developing and promoting dietary guidance that links scientific research to the nutrition needs of consumers. CNPP links nutrition research findings to consumers by using an integrated program of nutrition education, promotion, and program-focused economic and evidence-based research. CNPP translates nutrition guidance into consumer-oriented promotion programs to improve the dietary behavior of all Americans through behavior-change-based initiatives. CNPP also helps devise cost-effective strategies to target nutrition programs to different customers by analyzing consumer dietary needs, characteristics, behaviors, and lifestyles. CNPP serves a diverse consumer base—including the populations served by food and nutrition assistance programs. CNPP's Programming Continues to Link Science to the Nutrition Needs of Consumers Description Base Programming Areas • Nutrition Evidence Library Nation Education • Pietary Guidelinesſor Americans Promotion. and Analyses • MyPyramid Food Guidance System y • Healthy Eating Index * • Nutrition Education Tools/Tool Kits Monitoring of Food and • USDA Food Plans Nutrient Intake • U.S. Food Supply Series Nutrition Education, Promotion, and Analyses USDA Nutrition Evidence Library Supports the 2010 Dietary Guidelines Advisory Committee(DGAC): The Nutrition Evidence Library (NEL) is designed to help USDA monitor, assess, gather, analyze, and consult on the scientific evidence in support of nutrition, food, dietary guidance, nutrition education, and nutrition research policies and outreach programs. In 2009-2010, its major function was to support the 2010 Dietary Guidelines process. Consequently, the DGAC has been using evidence-based reviews to weight the preponderance of the science reported in many sources, including information derived by the USDA NEL. - - - - - The NEL staff managed the evidence analysis process—assigning and reviewing worksheets, developing evidence summary paragraphs and overview tables, and working with subcommittees of the DGAC. During the development of the recommendations for 2005 Dietary Guidelines for Americans, the DGAC reviewed the science to answer 35 questions. During the current deliberations, this DGAC is reviewing the science to answer 180 questions, about 5 times as many as before. The dependence on evidence-based reviews has improved the degree of thoroughness of the DGAC's work. Consideration of such a large number of questions is possible because of the capacity of the USDA NEL, a system of tools allowing for the review of the most up-to-date literature available on nutrition, food, public health, dietary guidance, nutrition education, and nutrition research policies and outreach programs. After the DGAC's work is complete, the NEL will be expanded to include topics of evidence-based reviews and a broader-based evidence library to support Federal and external organizations as a research entity with the unique capability of showing the weight of evidence to support policies, the gaps where additional research is needed, and serving as a repository of the most up-to-date literature available. 800 30g-84 Dietary Guidelines Advisory Committee—Reviewing Science for the 2010 Dietary Guidelines for Americans: The Dietary Guidelines for Americans are used in the SNAP, Child Nutrition, and WIC Programs to guide nutrition standards and benefit levels for clients ages 2 and up. The Dietary Guidelines for Americans are also used as the science-based foundation in all Federal nutrition education and promotion programs government-wide, including ones supporting Federal nutrition assistance, as well as most private sector nutrition education and promotion efforts. It is critical that the Dietary Guidelines for Americans be both scientifically up-to-date and in touch with the realities of contemporary living. Thus Public Law 101-445 requires USDA and DHHS to review the Dietary Guidelines for Americans at least every 5 years. The 13-member 2010 DGAC, appointed by the Secretaries of USDA and DHHS decided that revisions to the 2005 Dietary Guidelines for Americans were warranted. Thus, during the most recent meeting, the fourth, held November 4–5, 2009, the discussion focused on seven topic areas: Nutrient Adequacy; Carbohydrates and Proteins; Sodium, Potassium, and Water; Energy Balance and Weight Management; Food Safety and Technology; Fatty Acids; and Ethanol. : During the fourth meeting, the chair of the DGAC described the NEL process as one that would strengthen the Advisory Report and in turn enhance its value to inform the Federal Government in the development of policy. Because of the volume of questions, the DGAC will be able to propose conclusions (based on the evidence) on its questions, including “what if" questions answered by food-pattern modeling conducted by the CNPP. This modeling allows for the evaluation of the amounts of nutrients that could be consumed from various combinations of foods (i.e., dietary patterns) to obtain adequate intake. At the fifth meeting, scheduled for early 2010, the DGAC will propose conclusions on the remaining questions and reach general consensus on the science. At the sixth and final meeting, to be held during spring 2010, the DGAC will present and vote on its Advisory Report. In 2011, the focus on dietary guidance will transition to communicating messages to the public and delivery of effective nutrition education to various population groups, especially schoolchildren. CNPP is building cutting-edge systems designed to foster behavioral changes toward positive dietary practices and active lifestyles, as well as increase the distribution of materials, to help reduce the obesity epidemic, reduce incidences of diet-related chronic diseases, through prevention-focused interventions, and improve the overall health of Americans. In addition, CNPP will implement systematic evidence-based reviews of research reports on obesity and nutrition education interventions to determine the most effective communication strategies and classroom and community-based instructional design and the best methods of measuring the success of such interventions, USDA's Dietary Guidelines Food Guidance System called MyPyramid—Enhancements to Help Americans Change Their Dietary Practices: The MyPyramid operationalizes the Dietary Guidelines by employing the tenets of successful nutrition education about foods and dietary patterns through personalization, variety, proportionality, physical activity, moderation, and gradual improvement. The collection of tools and toolkits, located at http://www.MyPyramid.gov, now consists of the following: • MyPyramid Tracker; MyPyramid Plan; MyPyramid for Kids; MyPyramid for Preschoolers; MiPiramide; MyPyramid for Pregnancy and Lactation (MyPyramid for Moms); MyPyramid Menu Planner; My-Food-A-Pedia; Podcasts; Public Service Announcements; 801 30g-85 • A 10-Tip Series (easy-to-follow information on nutrition); and • Partnering with MyPyramid information. Since the release of the MyPyramid system of nutrition education information, CNPP has continually updated the content at the widely used MyPyramid Web-site to meet the nutrition-education needs of the general population, as well the needs of specific groups. These “Generation 1” changes to the Web-site have resulted in a positive trend in its use—a reflection of people’s searching for and using science-based nutrition information and trust in the Federal Government to provide quality information to guide dietary behavioral practices. As the chart below shows, the use of the MyPyramid tools increased each year. In 2005 (April to September), there were 1.0 billion hits to MyPyramid.gov, followed by 2.2 billion hits in 2006, 2.6 billion in 2007, 3.2 billion in 2008 and 3.5 billion in 2009. Chart. Use of MyPyramid tools increases each year 4 -*-* ***** --, -----, -, -, --- *-*-* ****.*.*.*, *- : * * * * * *...*.*, *, *, *, r* 2 2005 2006 2007 2008 2009 Fiscal years * The 2009 Food and Health Survey, a nationwide survey conducted by the International Food Information Council Foundation, shows that many Americans are familiar with MyPyramid; about 80 percent of Americans were familiar with it. Other results from the survey showed that one-quarter of Americans reported using MyPyramid to change the diet to lose weight (12 percent), change their or their family’s diet to eat more healthfully (11 percent), visited the Web site (8 percent), or used MyPyramid tools to plan or assess their diet (7 percent). The USDA is actively planning and implementing strategies that are designed to reduce obesity, especially childhood obesity, by increasing the effectiveness of nutrition education materials used by nutrition educators, researchers, health professionals, the general population, and by the population served by the nutrition assistance programs. The USDA's nutrition and food guidance system has a major role in increasing the effectiveness of nutrition education materials. The USDA has developed a comprehensive conceptual framework to move the nutrition education materials and tools of the MyPyramid Food Guidance System to “Generation 2.” This framework consists of using effective communications and marketing strategies what will help consumers identify and adopt the Dietary Guidelines for Americans as “the gold standard” of credible, science-based nutrition advice and information. To do so, USDA will focus on the following: - • Branding and Messaging; Partnering Opportunities; Tools and Products; Marketing and Dissemination; and Targeting Audience Resources: Identification of specialized or underserved populations. Healthy Eating Index-2005 Trends Indicate Improvement Needed in American Diet: Health studies indicate that although the rise in obesity in the U.S. has plateaued, the percentage of Americans who are obese is still high. The Healthy Eating Index (HEI) -2005 captures what is happening on a day-to-day basis in many American households: Most people have a diet that needs to improve in key areas: 802 30g-86 More whole grains; More whole fruits (than fruit juice); More dark-green and orange vegetables; Less sodium; and Less added sugars and solid fats. 4), - - - - - - The HEI-2005 is viewed by USDA, as well as by other Federal agencies and researchers, as the dietary assessment tool designed to measure compliance with key diet-quality recommendations of the 2005 Dietary Guidelines for Americans. Examples of such acceptance include the following: • The Federal Inter-Agency Forum on Aging-Related Statistics accepted USDA's proposal to have the HEI-2005 included as the diet-quality indicator in its 2010 edition of the report on key indicators of well-being. • The Federal Interagency Forum on Child and Family Statistics included the HEI among 40 key indicators of well-being in America's Children: Key National Indicators of Well-being, 2009. USDA reported the HEI-2005 scores for children (aged 2 to 17) in three age groups for 2003-2004. Results showed that for most aspects of the diet, quality declined with as the child's age increased (see table). • The HEI-2005 was featured at the closing plenary session of the International Conference on Diet and Activity Methods. A past chair of the DGAC used the HEI-2005 as an example of the importance of dietary assessment research methods in the setting of policy. . • In the 2009 State of the USA Health Indicators: Letter Report, the Institute of Medicine believed it was important to track HEI scores as indicators of the health of the U.S. population, given the relationship of diet to health. The CNPP will continue to monitor the quality of the American diet by using the HEI-200. The HEI will be updated, as required by Federal guidance policy. - Monitoring of Food and Nutrient Intake USDA Food Plans and Monthly Updates Support Food Assistance Delivery and Food Security: The Thrifty, Low-Cost, Moderate-Cost and Liberal Food Plans comprise the USDA Food Plans. These food plans specify the type and quantity of foods that people could consume at home to have a nutritious diet at a minimal cost. The TFP, consisting of model market baskets of foods, serves as a national standard for a nutritious diet at a minimal cost. It also serves as the basis for setting and adjusting maximum SNAP benefits. The Low-Cost Food Plan is used by bankruptcy courts in determining the portion of income to allocate to necessary food expenses for those seeking bankruptcy. The Moderate-Cost and Liberal Food Plans are used by the Department of Defense in setting the Basic Allowance for Subsistence rate for all enlistees. Many divorce courts use the USDA food plans to set fair alimony and child support payments, CNPP continues to report the monthly costs of the Food Plans: Cost of Food at Home. Published at http://www.cnpp.usda.gov, the information allows users to follow trends in the cost of food at home for various family types. Data from recent years show that for the reference family of four, the cost of the TFP reached a high of $606 at the beginning of FY 2009 and continued to trend downward, dropping to $576.40 in September 2009, about $29 dollar less than the cost in September 2008 (see chart below). These trends are a reflection of market-place dynamics. The updates to the USDA Food Plans are based on the most recent food and nutrition recommendations. Thus, preliminary work of the CNPP Food Prices Database has begun so that after the release of the 2010 Dietary Guidelines for Americans, the CNPP will be able to determine whether it is possible to obtain a healthful diet that meets current nutritional standards at a cost equal to the previous cost of the previous plans. 803 30-89 FOOD AND NUTRITION SERVICE Summary of Budget and Performance Statement of Goals and Objectives The Food and Nutrition Service (FNS) was established August 8, 1969, by Secretary's Memorandum No. 1659 and Supplement 1 pursuant to the authority contained in 5 U.S.C. 301 and the Reorganization Plan No. 2 of 1953. FNS increases food security and reduces hunger in partnership with cooperating organizations by providing children and low-income people access to food, a healthful diet, and nutrition education in a manner that supports American agriculture and inspires public confidence. FNS administers the U.S. Department of Agriculture's 15 nutrition assistance programs. These programs, which serve one in five Americans over the course of a year, are designed to provide low-income persons with access to a more nutritious diet, to improve the eating habits of the Nation's children, and to help America's farmers by providing an outlet for food purchased under agricultural support authorities. The agency's goals fully support the USDA Strategic Goal: “Ensure that all of America's children have access to safe, nutritious and balanced meals.” - USDA Strategic Strategic cºo: tive Programs that Contribute Key Agency Outcome Goal . . - Supplemental Nutrition Assistance Program Child Nutrition Programs - Special Supplemental Nutrition - | Agency Strategic - 3.. l Program for Women, Infants and Ç i. . ". I : sº - . Ensure Access to Children (WIC) - tºº. sº º Nutritious Food • Commodity Assistance Program food security by 100,000. • Food Distribution Program on USDA * Indian Reservations ‘.sº The Emergency Food Assistance 0.35: Program - - Ensure that • Reduce the rate of childhood all of supplemental Nutrition Assistance | *Y****** America’s Program • Establish national standards ..., |3:..., |- Child Nution Programs ºw" ve access $392.ÉSICJºſéCIRV8S 4: * - * ... ºt º ... S Promote Healthier | * i. ... throughout the school day. triti Eating Habits and ogram or women, Infants an . - ºned i. Children (WIC) (` º by meals . Center for Nutrition Policy and opportunities for farmers and Promotion food entrepreneurs to vend in low access areas. Agency Strategi Supplemental Nutrition Assistance Agèngy Strategic Program . Goals/Objectives 3: g * ... & Improve Program e Child Nutrition Programs • Reduce dollars lost through Management and • Special Supplemental Nutrition program errors, Customer Service Program for Women, Infants and Children (WIC). 804 30–90 Key Agency Outcome: Key Agency Outcome 1.1; Reduce the number of households with children who experience very low food security by 100,000. Long-term Performance Measures: • Reduce U.S. households with very low food security among children. • Increase the percentage of eligible people participating in the Supplemental Nutrition Assistance Program (SNAP) and the National School Lunch Program. • Support participation in the major Federal nutrition assistance programs for all eligible people seeking benefits. Selected Past Accomplishments toward Achievement of the Key Outcome: • The Supplemental Nutrition Assistance Program served an average of 33.7 million persons per month in FY 2009. The percentage of the eligible population participating was 65.8 percent in FY 2007, the most recent year for which data is available. • In FY 2009, the National School Lunch Program had average daily participation of 31.2 million children, and served 55.6 percent of school children in the United States. • Participation in the WIC Program increased to 9.1 million in FY 2009, Selected Accomplishments Expected at the FY 2011 Proposed Resource Level: • The Supplemental Nutrition Assistance Program will serve an average of 43.3 million persons per month and reach 68.5 percent of the target population. • The National School Lunch Program will reach average daily participation of 32.6 million children and serve 57.5 percent of the target population. - • The WIC Program will serve a monthly average of 10.1 million women, infants, and children. • 100,000 fewer U.S. households will experience very low food security among children. Key Agency Outcome 2. 1: Reduce the rate of childhood obesity in the United States. Long-term Performance Measures: - • Reduce the prevalence of overweight (a Body Mass Index at or above the 95th percentile for their age) among children and adolescents in the United States; increase the number of materials distributed to the population • Improve the Healthy Eating Index (HEI) scores – a measure of diet quality reflecting consistency with the Dietary Guidelines and MyPyramid – for people in households with incomes under 130 percent of poverty, and for the general population. • Increase the distribution of nutrition guidance, education, and promotion tools. Selected Past Accomplishments toward Achievement of the Key Outcome: • The Center for Nutrition Policy and Promotion made the Interactive Healthy Eating Index available online so that consumers can receive a quick summary measure of their diet quality. • In FY 2008, the Food Distribution Program on Indian Reservations increased participation in the Fresh Produce Initiative to nearly 91 percent of the FDPIR programs, allowing participants to receive a variety of fresh fruits and vegetables which would otherwise be difficult for them to obtain. • Team Nutrition produces a comprehensive nutrition education program targeting school children, parents, teachers, and food service staff. Selected Accomplishments Expected at the FY 2011 Proposed Resource Level: • The prevalence of overweight among children and adolescents will drop to 16.0 percent. • USDA will seek to improve Healthy Eating Index scores for the U.S. population to 59.0. • USDA will seek to improve Healthy Eating Index scores for people in households with incomes under the 130 percent of poverty to 57.9. • FNCS will distribute 3.9 billion pieces of nutrition guidance. 805 30-91 Key Agency Outcome 2.2: Establish national standards that improve the quality of food sold in schools throughout the school day. & Long-term Performance Measures: Secure authority and implement national nutrition standards for non- program foods served in schools during the school day. • Develop and implement updated nutrition standards for school meals, based on histitute of Medicine recommendations. - • Make healthful, nutritious options for students available to every student participating in the school meals programs. Selected Past Accomplishments toward Achievement of the Key Outcome: • Foods of minimal nutritional value prohibited in food service area during meal periods. • Nutrition standards are defined in program rules for lunches and breakfasts. Selected Accomplishments Expected at the FY 2011 Proposed Resource level: • FNCS will solicit public input on nutrition standards for non-program foods sold in schools during the school day. - Key Agency Outcome 2,3; Reduce food deserts by creating economic opportunities for farmers and food entrepreneurs to vend in low access areas, - - Long-term Performance Measures: Increase the number of farmers' markets authorized to redeem SNAP benefits. - . • Increase the volume of SNAP redemptions made through number of farmers’ markets. Selected Past Accomplishments toward Achievement of the Key Outcome: • Farmers’ Markets authorized to redeem SNAP Benefits reached 753 in FY 2008. • SNAP benefits redeemed at Farmers’ Markets reach $2.7 million in FY 2008. Selected Accomplishments Expected at the FY 2011 Proposed Resource Level: • i,300 farmers’ markets will be authorized to redeem SNAP benefits. • SNAP benefits redeemed at Farmers' Markets will reach $4.7 million. • Farm to School Tactical Team will be created to support local and regional food systems by facilitating linkages between schools and their local food producers. - Key outcome 3.1: Reduce dollars lost through program errors. Long-term Performance Measures: • Increase SNAP payment accuracy rate. Selected Past Accomplishments toward Achievement of the Key Outcome: • The FY 2008 SNAP certification error rates were the lowest in the history of the program. Selected Accomplishments Expected at the FY 2011 Proposed Resource Level. • The SNAP payment accuracy rate will be maintained at 95.0 percent. 806 30-92 Food AND NUTRITION SERVICE Summary of Budget and Performance Key Performance Outcomes and Measures USDA Strategic Goal: Ensure that all of America's children have access to safe, nutritious and balanced meals Key Agency Outcome 1.1: Reduce the number of households with children who experience very low food security by 100,000. (USDA High Performance Goal) Most American households have access at all times to enough nutritious food for an active and healthy lifestyle. However, too many households with children do not have money or other resources to assure this access. In 2007, over six million households with children were food insecure. In over 300,000 families, with nearly 700,000 children, one or more children simply do not get enough to eat – they had to cut the size of their meals, skip meals, or even go whole days without food at some time during the year. President Obama has committed the Administration to ending hunger among children by 2015. USDA is the Federal agency responsible for managing the domestic nutrition assistance programs, which work individually and in concert with one another to improve the Nation's nutrition and health. The FNS request supports this outcome by continuing the commitment to provide benefits to every eligible person who wishes to participate in the major nutrition assistance programs. Key Performance Measures: • Reduce U.S. households with very low food security among children. • Increase the percentage of eligible people participating in the Supplemental Nutrition Assistance Program and the National School Lunch Program. • Support participation in the major Federal assistance programs for all eligible people seeking benefits. Key Performance Targets: Fiscal Year Annual Performance Goals and Indicators 2006 2007 2008 2009 2010 2011 - Actual | Actual Actual Ł Actual Target Target U.S. households with very low food securi Not yet among children tº ty 22] 323 . 400* 350 300 Rates of eligible populations participating in: : • The Supplemental Nutrition Assistance 67.3% 65.8% | 66.5%" | 67.3%" | 68.0% | 68.5% Program (SNAP) • The National School Lunch Program (NSLP 54.6% 54.9% 55.5% 56.6*% 57.2% 57.5% Participation levels in: - • Average monthly SNAP (millions) 25.7 26.5 28.4 33.7 40.5 43.3 • Average daily NSLP (millions) 30, : 30.5 30.9 31.2 32.1 32,6 • Average monthly WIC (millions) 8, 1 8.3 8.7 9.] 9.5 } 0.1 *Figures are targets, actual data not yet available Means and Strategies: In order to achieve the performance targets, USDA will: • Fund and manage the major nutrition assistance programs to ensure access for all those eligible who wish to participate. • Increase participation rates in USDA nutrition programs through aggressive and creative outreach, customer service improvements, earned media activities, and research and analysis to identify reasons for participation gaps. 807 30-93 • Streamline applications, and make other policy and operational changes to programs and policies to make fo easier access to nutrition assistance programs, especially for children. ... • Engage State, local, and community leaders; form partnerships with allied organizations, advocacy groups, and local, State, and Federal communities. • Use Child Nutrition Reauthorization to improve program acc ess and expand eligibility for children in need. • Identify and publicize issues surrounding childhood hunger. Utilize media to communicate food sources for families in need. . - • Create a new contingency fund to offer additional flexibility in responding to pandemics, emergencies and disasters when the more significant resources authorized under the Stafford Act for large-scale disasters are diminished, depleted, or do not apply. Key Agency Outcome 2.1: Reduce the rate of childhood obesity in the United States. Diet is linked to many of the most prevalent and devastating health conditions we face in the United States, including overweight and obesity; coronary heart disease; hypertension; and the risk of stroke, diabetes, and some cancers. Data from NHANES surveys (1976–1980 and 2003–2006) show that the prevalence of obesity has increased: for those aged 6–11 years, prevalence increased from 6.5 percent to 17.0 percent; and for those aged 12– 19 years, prevalence increased from 5.0 percent to 17.6 percent. This rapid increase in the prevalence of obesity and overweight among both children and adolescents is a matter of great public health concern. Reducing the rate of obesity and improving the health of all Americans, including those in the USDA nutrition assistance programs, are central to the mission of the Center for Nutrition Policy and Promotion (CNPP) and fundamental purposes of establishing the Dietary Guidelines for Americans and communicating them through the MyPyramid, the bedrock components of Federal nutrition policy and nutrition education programs. USDA will use its nutrition assistance programs and its broader mutrition education efforts as key opportunities to promote more healthful eating and physical activity across the Nation. - Key Performance Measures: • Reduce the prevalence of overweight (a Body Mass Index at or above the 95" percentile for their age) among children and adolescents in the United States; increase the number of materials distributed to the population • Improve the Healthy Eating Index (HEI) scores – a measure of diet quality reflecting consistency with the Dietary Guidelines and MyPyramid – for people in households with incomes under 130% of poverty, and for the general population. • Increase the distribution of nutrition guidance, education, and promotion tools. Key Performance Targets: Fiscal Year Annual Performance Goals and Indicators 2006 2007 2008 2009 2010 2013 Actual Actual | Actual | Actual Target | Target Prevalence of overweight among children and 1632, Not yet Not yet | Not ye j6.0%" adolescents - .376 avail. avaii. avail. .V. Zo Healthy Eating Index scores for . - - • people in households with incomes under Not yet | Not yet | Not yet Not ye s” 57.9 130% of poverty avail. avail. avail. avail. • for the general population * Nº. * * 58.8 59.0 Nutrition guidance, education, and promotion }.5 2.6 3.2 Not yet. 3.0 3.9 tools distributed (e-hits and print materials) billion billion billion avail. bj}}ion biłłion *Overweight data from the National Health and Nutrition Examination Survey reported biennially 808 30-94 Means and Strategies: In order to achieve the performance targets, USDA will: • Promote the 2010 Dietary Guidelines for Americans and augment supporting educational tools and systems to promote more healthy eating and active lifestyles, including the design of new nutrition education, communication, and promotion methods, to ensure that nutrition education and guidance investments have the greatest impact. r - - • Partner with Federal health and education agencies, and other public and private sector entities, to promote the use of common messaging, support increased consumption of fruits and vegetables and encourage healthy school nutrition environments. - • Expand the Healthy lnitiatives Pilot (HEP), which is testing the impact of point-of-sale incentives on consumption of fruit and vegetables, to assess the impact of adding nutrition education to the incentive. • Demonstrate and test the impact of an innovative community-wide approach to raise awareness of healthy eating, create more opportunities to improve food choices, and reward such choices when made, as authorized by the 2008 Farm Bill. - - • Plan and implement strategies related to the development of the 2010 Dietary Guidelines so that Federal nutrition guidance continues to be based strongly on a preponderance of the scientific literature. Key Agency Outcome 2.2: Establish national standards that result in improved quality of food sold in schools throughout the school day (USDA High Performance Goal) - Most American children attend schools that offer the National School Lunch Program and the School Breakfast Program, which have nutrition standards based on the Dietary Guidelines for Americans. However, meals in most schools require improvement to meet these standards. - Schools also offer foods in addition to and in competition with the meal program offerings, in the cafeteria, in snack bars, and in vending machines. In contrast to program meals, these foods are not required to meet any Federal nutrition standards. These “competitive foods” too often tempt children to displace the more balanced meals they receive from the meals programs, and they set an unnecessarily bad nutritional example that helps train children in poor dietary habits. Improving the food made available to school children during the school day will help improve the nutritional intake and dietary habits of America's children at school and everywhere else. Key Performance Measures: • Secure authority and implement national nutrition standards for non-program foods served in schools during the school day. - - • Develop and implement updated nutrition standards for school meals, based on Institute of Medicine recommendations. - - • Make healthful, nutritious options for students available to every student participating in the school meals programs - Key Performance Targets: Fiscai Year Annual Performance Goals 2006 2007 2008 2009 . 2010 2011 and Indicators Actual Actual Actual | Actual Target Target National standards for non- Foods of minimal nutritional value Secure authority Publish Advance program foods in schools during prohibited in food service area during via CN Notice of school day meal periods. reauthorization Proposed Rule - * ... • Nutrition standards are defined in - - - * * National * * program rules at 7 CFR 210.10 for º: * COIntent Of SCHOOh Hºë3 S hunches & 220.8 for breakfasts J.S 809 30-95 - Fiscal Year - Annual Performance Goals 2006 2007 2008 2009 2010 2011 . and Indicators Actual # Actual | Actual | Actual Target Target Percentage of elementary/ - - secondary schools offering meal Not available” } 00/400 100/400 options consistent with Dietary. - - Guidelines for total fat - * *Most recent data available for 2003/04, when 93% of elementary schools and 86% of secondary schools offered low-fat options. Means and Strategies: In order to achieve the performance targets, USDA will: • Issue revised nutritional requirements for school based on Institute of Medicine recommendations for standards that will best conform to the Dietary Guidelines for Americans. These changes will then be implemented through aggressive and creative outreach to State administering agencies and schools. • Work with Congress to devise practical requirements to be included in the upcoming Child Nutrition Reauthorization so that necessary policy and operational changes to programs can be implemented with dispatch in all of the Nation's schools. - - - - • Engage State, local, and school food service leaders; form partnerships with allied organizations, advocacy groups, and local, State, and Federal communities. - • Identify and publicize issues surrounding the need for improved nutritional quality of food offered in schools and other aspects of the school nutrition environment, as well as how children can improve their dietary and physical activity habits to improve their diets and reduce overweight and obesity. Key Agency Outcome 2.3: Reduce food deserts by creating economic opportunities for farmers and food entrepreneurs to vend in low access areas (USDA High Performance Goal) Limited access to nutritious food and relatively easier access to less nutritious food may be linked to poor diets and, ultimately, to obesity and diet-related diseases. Increasing the opportunities for farmers and food entrepreneurs to vend in low access areas will reduce food and transportation costs and improve access to a more nutritious food supply for many households. Nutrition assistance programs with benefits that can be redeemed though such vendors can help low-income families take advantage of improved access to healthful choices. In particular: • SNAP provides household benefits that can be redeemed at retail food outlets; currently, about 900 farmers markets are authorized to redeem SNAP benefits. - • The WIC Farmers' Market Nutrition Program (WIC FMNP) and the Senior Farmers Market Nutrition Program (SFMNP) boost sales of fresh fruits and vegetables at farmers markets, especially in areas where consumers are more likely to face food insecurity problems. Key Performance Measures: • Increase the number of farmers' markets authorized to redeem SNAP benefits. • Increase the volume of SNAP redemptions made through number of farmers’ markets. Key Performance Targets: - Fiscal Year Annual Performance Goals and Indicators 2006 2007 2008 2009 2010 201 || -- - Actual Actual || Actual | Actual Target i Target * * - Not Not - * SNAP-authorized farmers’ markets avail. avail. 753 900 1,400 1,300 * - y Mot Mot $2.7 $3.2 $4.6 $4.7 SNAP redemptions in farmers’ markets avail. avail. million million* } million million *Figures are targets; actual data not yet available 810 30-96 Means and Strategies: In order to achieve the performance targets, USDA will: • Launch a “Farm to School Tactical Team” to support local and regional food systems by facilitating linkages between schools and their local food producers. The Tactical Team is comprised of both FNS and Agricultural Marketing Service staff members, who will work with local and State authorities, school districts, farmers, and community partners to develop mechanisms to assist schools in accessing local markets, enable food producers to effectively service their local schools, and facilitate communication between interested stakeholders. • Equip farmers’ markets across the country with point-of-sale devices to redeem SNAP benefits. Nearly 4,000 of the approximately 4,700 farmers' markets operating across the Nation do not have electronic equipment to redeem SNAP benefits. • Work with SNAP clients to raise awareness of the availability and advantages of using SNAP benefits at farmers’ markets. - - . • Once the fruit and vegetable vouchers that are part of the new WIC food package are implemented by WIC State agencies, FNS will encourage States to authorize farmers markets as WIC vendors. • Continue to promote the WIC FMNP among WIC participants, and SFMNP among low-income seniors. Key Agency Outcome 3.1: Reduce dollars lost through program errors. . USDA is strongly committed to maintaining a high level of stewardship and integrity in the nutrition assistance programs and preventing errors. Effective program management helps ensure that those families and individuals most in need of nutrition assistance receive it and that the funds intended for this purpose are not diminished by waste or program abuse. USDA plans to make use of all available opportunities, including new communication and eGovernment technologies, to serve our customers, work with partners, and administer our programs as effectively as possible. - - Key Performance Measure: Increase the SNAP payment accuracy rate. Key Performance Targets: Fiscal Year - 2006 2007 2008 2009 2010 2011 Annual Performance Goals and indicators Actual | Actual | Actual | Actual | Target | Target SNAP payment accuracy rate. 94.2% 94.4% 95.0% 95.0%" | 95.0% 95.0% *Figure is a target; actual data not yet available Means and Strategies: In order to achieve the performance targets, USDA will: • Support State efforts to improve SNAP benefit accuracy through oversight, training, technical assistance and “promising practices” information sharing. • Manage and improve systems to disburse and account for program resources. • Promote effective program operations at the State and local levels through strong Federai oversight, training and technical assistance. 811 30-97 Food and Nutrition Service Full Cost by Strategic Goal Program Level (Dollars in Thousands) if USDA Strategic Goal: Ensure That America's Children Have Access to Safe, Nutritious and Balanced Meals PROGRAM H ACTIVITY - FY 2009 FY 2010 FY 2011 Child Nutrition Program Child Nutrition Programs School lunch Program $8,933,7; i $40,218,168 $40,713,047 School Breakfast.Program 2,607,356 2,897,802 . 3.} i7,863 Child and Adult Care Food Program 2,451,682 2,615,929 2,728,754 Summer Food Service Program 356,333 376,521 397.226 Special Milk Program 14,286 ; i,888 10,597 State Administrative Expense 174,134 193,258 208,653 Total, Cash Grants to States 14.587,501 16.3 i3,566 17, 176, 140 USDA Foods (Sec 6c Entitlement) - 716,879 674,492 f,039,737 Child Nutrition Program Discretionary Activities 41,388 48,376 65,565 ARRA NSLP Equipment Grants #00,000 - {} {} Child Nutrition Program Permanent Activities 59,453 263,020 i2},500 Nutrition Programs Administration (Allocation to this program) 34, #04 35,972 39,044 Other Program Costs $/ - 643,271 643,27; 643,271 Total Cost $16,182,597 $17,978,697 $39,085,257 FTEs 402 43? 447 Uuit Costs Child Nutrition Total Cost per Meal Served ($/service unit) 6/ $4.71 $1.83 $1.9 | Performance Measure: Avg. daily NSLP participation (millions) 31.2 32.1 32.6 Performsnce Measure; Avg. daily SBP participation (millions) : | H.0 | 1.7 | 2.2 Special Supplemental Nutrition Program for women, Infants and Children (wic) Cash Grants to States: Food & NSA (inclusive of projected carryout) $6,932,291 $7,562,294 $7,860,646 ARRA Contingency Grants to States 38,175 O 0. infrastructure Grants 8,090 13,600 #3,600 Technical Assistance 385 - 400 400 Breastfeeding Peer Counselors #4,941 80,000 83,000 Management information Systems - {} 60,000 60,000 Program Evaluation and Monitoring () H5,000 15,000 Federal Administrative Oversight and Infrastructure d 9,850 15,000 Breastfeeding Performance Bonus {} 5,000 I0,000 ARRA WłC MIS 34, İş7 65,833 {} Nutrition Programs Administration (Allocation to this program) 19,097 20, 144 21,864 Other Program Costs - - Ö {} () Total Cost $7,047,356 $7,832,10] $8,079,510 FTEs. 137 Jö8 - I74 Unit Costs . WIC (Total Annual Cost per Participant) 7/ - $772-80 $824.6} $803,37 Performance Measure: Average monthly WIC participation (millions) 9.1 9.5 10. I 812 30-98 PROGRAM / ACTIVETY FY 2009 FY 2010 FY 2011 Supplemental Nutrition Assistance Program Account Supplemental Nutrition Assistance Program (SNAP) $49,324,256 $58,311.951 $61,144,740 ARRA SNAP Benefits and Admin. Furids 4,478,246 i{},674,862 i i,670,027 Nutrition Assistance for Puerto Rico (NAP) 1.760,435 1,745,351 1.735,873 ARRA NAP Funds 240, i33 254.2 #7 264,695 Food Distribution Program on Indian Reservation (FDPIR) liá,866 1 2,797 | 10,058 ARRA FDPIR Equipment Funds 3,712 1,288 0 The Emergency Food Assistance Program (TEFAP) Commodities 250,000 248,000 246,500 American Samoa 5,219 7,043 6,971 ARRA American Samoa Benefits 964 1,021 1,063 Program Access/ Community Food Project! CNMI 27,009 42,033 22, #48 Nutrition Programs Administration (Allocation to this program) 70,934 74,822 8},210 Other Program Costs 2/ - 703 703 703 Totai Cost $56,276,477 $73,475,058 $75,283,988 FTEs. 6;2 550 680 Unit Costs SNAP (Total Annual Cost per Participant) 3.4 $1,597.48 $4,703.56 $1,685.00 FDPIR (Total Annual Cost per Participant) 4/ $1, $23.26 $1,340. 16 $990.82 Performance Measure: Average monthly SNAP participation (millions) 33.7 40.5 43.3 Commodity Assistance Program. Account Commodity Supplemental Food Program (CSFP) $165,464 $171,434 $176,788 The Ermergency Food Assistance Program (TEFAP) Administrative Cost 49,811 49,500 50,000 ARRA TEFAP Administrative Funds 25,000 25,000 0 ARRA TEFAP Commodity Funds 100,000 0 O TEFAP Infrastructure Grants 0. 5,000 0. Farmers' Market Programs - Farmers' Market Nutrition Program 21,750 20,045 20,000 Seniors' Farmers' Market Program 22,466 23,654 20,600 Commodity Assistance (Nuc, Affected Iski, Disaster Asst. NSiP Comm.) 3,704 4,494 1,081 HT Modernization and Support - () 0. l,750 Nutrition Programs Administration (Allocation to this program) 12,277 12,950 $4,056 Other Program Costs 8./ 382,695 382,695 382,695 Totaſ Cost $783, 167 $692,772 $666,970 FTEs 90 96 100 Unit Costs - CSFP (Total Annual Cost per Participant) 9/ $373.74 $368, 10 $307.23 Performance Measure: Average monthly CSFP participation (thousands) 465.659 585.46. H 604.543 Nutrition Programs Administration Account (Center for Nutrition Policy and Promotion) Center for Nutrition Policy and Promotion $6, 183 $3,913 $12,913 Congressional Hunger Center Fellows 2,347 3,000 3,000 Nutrition Programs Administration (Allocation to this program) NA NA NA Other Program Costs 0 {} 0 Total Cost $3,530 $6,913 $15,913 FTEs. 28 32 42 Performance Measure: Pieces of nutrition guidance distributed 2.5 billion 3.0 billion 3.9 billion 813 30-99 s Total for Strategic Goal Subtotal FNS Program cost - $80,297,937 $97,985,540 $103,331,638 Less Other Program Costs - - 1,026,669 1,026,669 1,026,669 Totai FNS Program Cost $79,271,268 $96,558,872 sloz,104,969 FTEs 1,269 1,38? 1,443 Notes l/ Reflects current and prior year resources, supplementals and recissions as appropriate. Supplemental Nutrition Assistance Program Account 2f includes FDPIR bonus USBA foods. Aſ SNAP Average Monthly Participation Assumptions: FY 2009:33.7 million; FY 2010:40.5 million; FY 2011:43.3 million. 4) FDPIR Average Monthly Participation Assumptions: FY 2009:95,369, FY 2010: 100,137; FY 2011: 100,137. Child Nutrition Programs Account 3/ includes entitlement, bonus, and 12 percent shortfall USDA foods purchased in support of the program from Sections 32 and 416 funds. 6/ Unit cost calculated based on full cost of Child Nutrition account divided by all units of service funded under this account. Special Supplemental Nutrition Program for Women. Infants and Children (WIC) 7 wic average monthly participation assumptions. FY 2009. 9.1 million; FY 2010.9.5 million; FY 2011; 10.1. Commodity Assistance Program. Account §ſ includes bonus USDA foods for TEFAP, CSFP, Disaster, Summer Camps, Prisons, Nuclear Affected Island, and other commodity assistance, 91 CSFP average monthly participation assumptions: FY 2009:466,659; FY 2010: 585,461; FY 2011: 604,543. 2011 Explanatory Notes Foreign Agricultural Service Table of Contents (815) Page Purpose Statement 31-? Statement of Available Funds and Staff Years 31-3 Permanent Positions by Grade and Staff Ye 31-4 Motor Vehicle Fleet Data........ - 31-5 Salaries and Expenses: Appropriations Language 31-6 Lead-off Tabular Statement 31-7 Project Statement - 34-7 Justifications * 31-8 Geographic Breakdown of Obligations and Staff Years 31-14 Classification by Objects...... * 3}-15 Recovery Act 31–16 Status of Program 31 g-1 Summary of Budget and Performance Statement of Goals and Objectives 31-18 Key Performance Outcomes and Measures 31-27 Full Cost by Strategic Objective........................................................................................................... 31-29 Public Law 480 Purpose Statement 31-31 Statement of Available Funds and Staff Years 31-33 Appropriations Language 31–34 Lead-off Tabular Statement......................................................................................................................... 31-35 Project Statement and Justifications 31–36 Classification by Objects 31–37 Commodity Credit Corporation Export Loans Program Account Appropriation Language.............................................................................................................................. 3 i-38 Lead-off Tabular Statement 31–39 Project Statement and Justifications 31-40 Classification by Objects 31–41 McGovern-Dole International Food for Education and Child Nutrition Grants Purpose Statement 31-42 Statement of Available Funds and Staff Years 31-42 Appropriations Language 31–42 Lead-off Tabular Statement 31-43 Project Statement 31-44 Classification by Objects ... 31-44 Geographic Breakdown of Obligations and Staff Years 31-44 31-1 FOREIGN AGRICULTURAL SERVICE PURPOSE STATEMENT The Foreign Agricultural Service's (FAS) mission is linking U.S. agriculture to the world to enhance export opportunities and global food security. FAS helps to provide outlets for the wide variety of agriculture products produced by U.S. farmers, thereby enhancing economic activity for U.S. workers. FAS serves U.S. agriculture's interests by expanding and maintaining international export opportunities, supporting international economic development and trade and science capacity building, and supporting climate change analysis and U.S. agricultural interests in international negotiations. The outcomes envisioned are exports that help U.S. agricultur prosper; the expansion of U.S. exports of organics and crops produced using new technologies; food that is globally available, accessible, and appropriately used; and climate change provisions in international agreements. that benefit U.S. agriculture. In addition to its Washington-based staff, the agency maintains a network of overseas offices that serve as first responders in cases of market disruption. The overseas offices also provide the Department with critical market and policy intelligence, and they represent U.S. agriculture in consultations with foreign governments. - The Foreign Agricultural Service was established on March 10, 1953, by Secretary's Memorandum No. 1320, Supplement 1. Public Law 83-690, approved August 28, 1954, transferred the agricultural attaches from the Department of State (DoS) to the Foreign Agricultural Service. Secretary's Memorandum No. 1020-39, dated September 30, 1993, transferred the functions of the former Office of International Cooperation and Development to the Foreign Agricultural Service. FAS reorganized November 13, 2006, realigning functions and personnel to address significant changes in world agricultural trade and better address new challenges, - Description of Agency Activities: Agricultural Exports A substantial portion of U.S. agricultural cash receipts comes from export sales, making the vitality of rural America heavily dependent on international trade. FAS gives U.S. government policy makers, producer groups, private exporters, and producers the market intelligence they need to develop successful market strategies. Commodity analysts and country experts in Washington and around the world provide timely analysis of global trends, which enable policy makers and private exporters to respond promptly to changes in the international market, FAS' unique relationship with U.S. producer groups, known as cooperators, allows U.S. agriculture to nimbly respond to such changes. FAS also works to gain, maintain, and expand access to foreign markets in the face of unfair trade barriers. Removing existing barriers, while ensuring new ones are not introduced, directly helps rural America thrive. U.S. farm exports benefit from a wide range of programs and services administered by FAS. FAS also facilitates development and access to markets through technical assistance and capacity building programs, which promote the development of trade-friendly regulatory systems and infrastructure in emerging markets. The FAS programs that contribute to agricultural exports include: Market Access Program (MAP), Foreign Market Development (FMD) Program, Technical Assistance for Specialty Crops (TASC) Program, Emerging Markets Program (EMP), Quality Samples Program, and Export Credit Guarantee Program. New Technologies FAS promotes the acceptance of crops produced using biotechnology and other new technologies and organic standards around the world by drawing on Attachés covering more than 150 countries and knowledge of negotiations to work with international organizations to develop fair, transparent international standards that will support the use of new technologies. In 2009, approximately 85 percent of the corn, 55 percent of the cotton, and 91 percent of the soybeans planted in the United States were biotech varieties. An estimated 80 percent of U.S. food products contain biotech ingredients and could be negatively affected by restrictive labeling measures, testing requirements, or outright bans. Exports of these crops and other foods produced or processed using modern biotechnology form the core of the U.S. agricultural exports that 817 320719 GAO-09- Report issued 31-2 totaled $96.6 billion in 2009. Additionally, FAS works with developing countries to expand their capacity to effectively regulate and commercialize crops produced using new technologies, Finally, FAS advances educational programs to introduce government officials and other opinion leaders to the benefits of new technologies, alongside the DoS and private industry. FAS programs that contribute to new technologies include the Borlaug Fellowship Program and the Cochran Fellowship Program. - Food Security FAS is the link that enables the United States to share both its food resources and its technical expertise with those in need. The FAS global network of agricultural Attachés and locally engaged staff (LES) provide first-hand information on foreign agricultural markets, crop conditions, political dynamics, an institutional knowledge of host countries, and long-term relationships with foreign stakeholders, FAS has significant experience administering aid, technical assistance, capacity building programs, and exchanges that build in-country productivity. FAS also manages USDA's component of the Civilian Response Corps and the deployment of USDA experts abroad to assist in developing competitive food systems in countries which are of high priority for meeting U.S. national security and food security objectives. The programs that support food security include the: McGovern-Dole International Food for Education Program, Food for Progress, Borlaug Fellowship Program, Cochran Fellowship Program, Technical Assistance and Capacity- Building, Civilian Response Corps, and agricultural reconstruction and stabilization activities. These capabilities complement USAID capabilities and the overall policy lead of the Department of State. Climate Change Careful monitoring and analysis of international climate change policies, legislation, and activities ensures that U.S. agriculture receives the full benefit of international agreements and trade rules. FAS provides a global monitoring system for U.S. agricultural trade through its overseas offices. Agricultural Counselors, Attachés, and Officers covering over 150 countries are often the first to hear about issues of concern to U.S. agricultural interests. Headquarters of the Foreign Agricultural Service is in Washington, D.C. In addition to a highly specialized Washington-based staff, the agency maintains a targeted and highly efficient network of 97 offices around the world that serve as first responders in cases of market disruption, provide critical market and policy intelligence to support our strategic goals, and represent U.S. agriculture in consultations with foreign governments. As of September 30, 2009, FAS had 714 permanent full-time employees, including 525 in headquarters and 189 in field locations. Foreign Agricultural Service USDA Office of Inspector General and U.S. Government Accountability Office Audit Activity Fiscal Year 2009 Report Issued 1, 2008 Audit Began March 23, 2009 Report Issued International Food Assistance: Local and Regional Procurement Can Enhance the of U.S. Constrain Began l U Began 2009 Food No OIG audits were started or reported in FY2009 FOREIGN AGRICULTURAL SERVICE Available Funds and Staff Years 2009 Actual and Estimated 2010 and 2011 Item Actual 2009 Estimated 2010 Estimated 2011_ Staff Staff - Staff Amount Years Amount Years Amount Years Salaries and Exp 165,436,000 725 180,367,000 786 258,780,000 786 CCC Export Loans Program Account 4,985,000 31 6,465,000 33 6,525,000 33 Total, Salaries and Exp 170,421,000 756 186,832,000 819 265,305,000 819 Obligations under other USDA appropriations: Commodity Credit Corporation for: - Market Access Program Admin. Costs............................. 1,680,500 3 2,115,000 3 2,115,000 * 3 Technical Assistance for Specialty Crops - Program Admin. Costs........................................ 62,000 f 375,000 l 375,000 * i Emerging Markets Program Admin. Costs ................. 127,000 2 750,000 2 750,000 * 2 Quality Samples Program Admin Costs..................... 36,000 1 175,000 I 175,000 * } Foreign Market Development Program Admin. Costs...... - -- 350,000 ! 350,000 I Local and Regional Procurement Admin. Costs............. 250,000 ! 1,550,000 2 1,550,000 * 2 Food for Progress Admin. Costs............................... 9,000 } 3,300,000 2 3,300,000 * 2 Trade Adjustment Assistance Program - Admin Costs.... 220,834 ! 615,000 l 150,000 } McGovern Dole Program - Admin Costs.................... 3,000,000 13 3,500,000 H3 3,500,000 13 Landsat data and support of export programs..................... 1,752,500 3 2,000,000 3 2,250,000 3 IRM Activities 15,027,200 wº- 19,127,200 -- 15,767,000 ** IRM Activities (Non-CCC) 5,000,000 -- 5,000,000 ** 5,000,000 as tº Under Secretary Int'l Travel for Trade Matters.................... 300,000 ** 400,200 www.sº 450,000 ** Emerging Markets Program 5,552,295 7 5,000,000 5 5,000,000 5 Support of and access to the USDA Satellite Imagery wº Library: NRCS, APHIS, ARS, RMA, NASS, FS........... 2,005,117 l 1,400,000 l 1,100,000 I Capital Security Cost Share 3,576,817 • * 3,720,000 -- 3,720,000 -º- Visiting Scientist Program...................................... i,003,328 | 1,100,000 * - 1,500,000 ** Codex................................ 820,758 f 763,000 -- 800,000 es Miscellaneous 137,538 ! 200,000 -- 200,000 tº tº Office of the Secretary: Congressional Relations............... 197,000 l 200,000 º- 200,000 dº sº Trade Negotiations and Biotechnology Fund (OSEC)......... 1,076,021 8 1,100,000 8 1,100,000 8 Avian Influenza (APHIS) 477,256 6 200,000 l 200,000 i CCC Program Support 7,284,585 ** - -- º * * Agricultural Reconstruction and Stabilization (DM)........... º -- 13,000,000 -- - tººs P.L. 480 Titie I 4,876,560 -- - ºf- - -- P.L. 480 Title II 101,088 } 120,000 H 120,000 I Total, Other USDA Appropriations 54,573,397 53 65,760,400 45 49,672,000 45 Total, Agriculture Appropriations 224,994,397 809 252,592,400 864 3.14,977,000 864 Qther Federal Funds: U.S. Agency for International Development (USAID) and - others for developmental assi 66,686,670 142 65,800,000 142 65,800,000 #42 USAID and U.S. Department of State (DoS) for Reconstruction and Stabilization Activities....................... 19,267,300 -- 209,000,000 -- 18,000,000 ** Total, Other Federal Funds 85,893,970 142 274,800,000 142 83,800,000 142 Total, Foreign Agricultural Service 310,888,367 951_527,392,400 1,006 398,777,000 1,006 * Funding to be made available based on the authority provided in the General Provisions that will extend section. 103 of the American Recovery and Reinvestment Act of 2009 (Public Law 1 1-5). FOREIGN AGRICULTURAL SERVICE Permanent Positions by Grade and Staff Year Summary 2009 A Estimated 2010 and 20% i 2009 2010 201 || Grade Wash DC Field Total Wash DC Field Total Wash DC Field Total Senior Executive Service 7 0 7 7 {} 7 7 0 7 Senior Foreign Service 4. i4 i8 4 14 #8 4 14 #8 GS-45 - 64 () 64 64 () 64 64 0 64 GS-14 158 0 158 158 0 158 158 {} #58 GS-13 193 1. 194 195 I 196 195 } 196 GS-12 138 {} #38 #38 0. 138 138 0 #38 GS-1 # 13 {} 13 13 0 13 13 0 13 GS-10 f {} l f 0 } } () l GS-9 16 {} 16 I6 0. 16 16 0 16 GS-8 - 20 1 2} 20 } 2} 20 { 21 GS-7 25 {} 25 25 0. 25 25 0 25 GS-6 7 0 7 7 {} 7 7 0. 7 GS-5 0 0 0. () {} 0. 0. () {} GS-4 o O 0 0. {} 0. () 0 0. GS-3 () 0 0. 0 () {} 0 0 {} GS-2 {} {} 0 {} {} {} {} 0. 0 Other Graded Positions......................... - 8 177 H35 8 177 185 8 177 i85 Ungraded Positions........... -- -- -- * - *º. --> ** -- Total Permanent Positions......................... - 654 193 847 656 {93 $49 656 193 849 Unfilled Positions end-of-year..................... 129 4 {33 sº -- *: - * - Total, Permanent Full- Time Employment, end-of-year................... 525 189 714 aſ 656 193 849 656 193 349 Staff Year Estimate.......... 710 24} 951 765 24] 1,006 241 1,006 765 a/The total permanent full-time employment does not match 113-A due to erroneous count for foreign country staff (line 5 of the 113-A). Size, Composition and Annual Cost Agency: United States Department of Agriculture e Foreign Agricultural Service Number of Vehicles by Type Sedans & - -> Light Light º Ammual w Stationwagons Medium Heavy Total º Fiscal Y T - SCai Year (includes Trucks | Trucks Trucks Trucks. Ambulances | Buses Vehicles Operating - - 4x2 4x4 - Costs minivans) FY 2008 6 24 26 0 0 {} {} 56 $217,689 Change from 2008 17 -j9 -] - -3 ($9,108) FY 2009 23 5 25 0 {} 0. () 53 $208,581 Change from 2009 () i -i - 0 ($103,285) FY 2010 23 6. 24 {} () 0. {} 53 $105,296 Change from 2010 {} 3 -3 - - {} $64,499 FY 2011 23 9 21 0 {} 0 {} 53 $169,795 Notes: The mission of FAS is linking U.S. agriculture to the world to enhance export opportunities and global food security. The FAS mission requires the use of official vehicles to provide for crop assessment trips to gather agricultural data, official travel to countries within regional coverage, transportation to local government offices, travel to official functions that include representational events with agribusiness organizations, transportation of official visitors, and mail/messenger courier services. FAS acquires and assigns official U.S. Government (USG) vehicles to overseas stations for the express purpose of carrying out the official business in the performance of the FAS mission. The criteria considered annually for assigning a vehicle to an overseas post consists of the purpose of the vehicle, the availability of other means of transportation and related costs, the security of FAS personnel, and the authorized ceiling by Congress and USDA. Each FAS overseas office is responsible for the daily management of their official vehicle with the ultimate oversight responsibility residing in FAS/Washington. The FAS Overseas Administrative Handbook cites guidelines governing the management of official USG vehicles that requires a Vehicle Usage Log to be maintained recording official vehicle use. FAS policy states that the criterion for replacing official vehicles is 7 years old or more than 100,000 miles. Condition of the vehicle and analysis of repairs and operating costs are also factors in replacement. In FY 2010, FAS will be replacing three (3) 4 x 4 SUV's with three (3) 4 x 2 SUV's. Although there have been no overall changes to FAS’ overseas vehicle inventory, the decrease in operating costs from FY 2009 to FY 2010 is credited to more detailed vehicle reporting and careful analysis. The FY 2011 FAS overseas vehicle fleet will be comprised of two (2) sedan/station wagons, twenty-one (21) 4 x 2 passenger minivans, nine (9) 4 x 2 light SUV trucks, and twenty-one (21) 4 x 4 light SUV trucks. The difference in the F.A.S.T data acquisition and operating costs is a reflection of estimates and not actual. The F.A.S.T data is required before FAS overseas offices are required to report at fiscal year end at final budget reviews. The data included in the size, composition, and operating cost of the FAS fleet are actual numbers. 821 31-6 FOREIGN AGRICULTURAL SERVICE t estimates include appropriation language for this item as follows (new language underscored; deleted atter enclosed in brackets): alaries and Expenses (including transfers of funds): For necessary expenses of the Foreign Agricultural Service, including not to exceed $158,000 for representation allowances and for expenses pursuant to section 8 of the Act approved August 3, 1956 (7 U.S.C. 1766), [$180,367,000] $258,780.000: Provided That the Service may utilize advances of funds, or reimburse this appropriation for expenditures made on behalf of Federal agencies, public and private organizations and institutions under agreements executed pursuant to the agricultural food production assistance programs (7 U.S.C. 1737) and the foreign assistance programs of the United States Agency for International Development: Provided further, That of the amount appropriated under this heading. $14,600,000 is for stabilization and reconstruction activities to be carried out under the authority provided by title XIV of the Food and Agriculture Act of 1977 (7 U.S.C. 3101 et seq.) and other applicable laws: Provided further, That funds made available for middle-income country training programs and up to $2,000,000 of the Foreign Agricultural Service appropriation solely for the purpose of offsetting fluctuations in international currency exchange rates, subject to documentation by the Foreign Agricultural Service, shall remain available until expended: Provided further. That of the total amount appropriated under this heading. $34,500,000 shall be available for market development activities of the Foreign Market Development Program pursuant to title VII of the Agricultural Trade Act of 1978 (Public Law 95-501), as amended: Provided further, That of the total amount appropriated under this heading. $9,000,000 shall be available for activities under the Technical Assistance for Specialty Crops Program pursuant to section 3205 of the Farm Security and Rural Investment Act of 2002 (Public Law 107-171), as amended, - 822 31-7 FOREIGN AGRICULTURAL SERVICE HES A ES - CURRENT LAW Appropriations Act, 2010 $186,832,000 Budget Estimate, 2011 265,305,000 Increase in Api *...a...? + 18473,000 SUMMARY OF INCREASES AND DECREASES-current Law (On basis of appropriation) 2010 Program 201 | item of Change Estimated Pay Costs Changes Estimated Agricultural Exports......................................... $t 22,672,000 $905,000 $58,378,000 $181,955,000 New Technologi $23,406,000 $173,000 $928,000 $24,507,000 Food Security $37,825,000 $279,000 $17,667,000 $55,771,000 Climate Change $2,929,000 $22,000 $121,000 - $3,072,000 Total Availabi $186,832,000 $1,379,000 $77,094,000 $265,305,000 Project Statement - Current Law (On basis of appropriation) 2009 Actual 2010 Estimated Increases 2011 Estimated Staff Staff . Or Staff Amount Y Amount Years Decreases Amount Years Agricultural Exports $il 1,841,000|º 496 $122,672,000 533 $59,283,000 (1) $181,955,000 533 New Technologi $21,415,000 95 $23,406,000 {{}} 1,101,000 (2) $24,507,000 101 Food S - $34,490,000 153 $37,825,000 173 17,946,000 (3) $55,771,000 173 Climate Change - $2,705,000 #2 $2,929,000 12 _143,000 (4) $3,072,000 H2 Total Available or Esti 170,421,000 756 186,832,000 819 78.473,000 265,305,000 819 Credit Reform Funds Transfer from CCC Export Loans Program Accounts...........; –4,985,000 -31 –6,465,000 -33 -60,000 -6,525,000 -33 Total, Available Funds $165,436,000 725 $180,367,000 786 $78,413,000 $23,730,000 786 SALARES AND EXPENSE BY FUNDING SOURCE (Dollars in Thousands) Direct CCC Appropriationi Export Credit Total FY 2010 Enacted................................... ... . . . . . . . . . . . . . . . . . $180,367,000 $6,465,000; $186,832,000 FY 2011 Estimated Changes: National Export Initiativ $3,500,000 0. 53,500,000 Cochran and Borlaug Fellowship Programs...................... 1,500,000 0 1,500,000 Agricultural Reconstruction and Stabilization Activities........ 14,600,000 0} 14,600,000 Pay Cost............................................................... 1,379,000 0 1,379,000 (CASS................................................................. 3,430,000 {} 3,430,000 Overseas IT Support 4,004,000 0. 4,004,000 Export Credit Guarantee Program Admin. Expense................ {} 60,000 60,000 Total, FY 2011 Estimated.............................................. $258,780,000 $6,525,000 $265,305.000 31-8 Justification of Increases and Decreases The FY 2011 budget reflects a total increase of $78,413,000. 1. An increase of $53,500,000 for the National Export Initiative. FAS supports the National Export Initiative which has the primary goals of spurring economic growth and employment opportunities. The future of U.S. agriculture is tied to trade, as agricultural trade is an important generator of output, employment, and income in the U.S. economy. In concert with the interagency Trade Promotion Coordinating Committee (TPCC), FAS will work with and through U.S. farm groups, state departments of agriculture and state regional trade groups (SRTGs), agricultural trade and industry organizations, and other USDA agencies to draw on all available expertise to maximize the positive impacts of this initiative. - The initiative includes an increase of $10 million to expand FAS exporter assistance and in-country promotion activities and to meet higher operating costs at FAS overseas posts. The initiative also includes $34.5 million to supplement funding for the Foreign Market Development (Cooperator) Program and $9 million for the Technical Assistance for Specialty Crops Program. Funding is - increased for the Cooperator Program in order to broaden the opportunity for program participation and to support new, innovative program activities. The expansion in TASC funding reflects the growing importance of specialty crops for U.S. agricultural export growth and the success TASC has had in helping to resolve numerous trade barriers. . - - - An increase of $1,500,000 to fund the Borlaug and Cochran Fellowship programs. This funding will improve FAS’ capability to provide technical assistance and capacity building programs, including in- country, third-country, and U.S.-based training programs, as appropriate. FAS would increase the Cochran Fellowship Program and the Norman E. Borlaug International Agricultural Science and Technology Fellows Program to support USDA’s efforts to improve world food security. An increase of $14,600,000 to fund agricultural reconstruction and stabilization activities. This request moves funding for these activities from Departmental management to FAS and includes an additional. $1,600,000 to cover cost-of-living increases and higher administrative expenses for agricultural development work, primarily in Afghanistan. - An increase of $1,379,000 to cover the anticipated FY 2011 pay raise. Pay cost increases are based on 2.0 percent for the January 2010 pay raise and 1.4 percent for the January 2011 pay raise. These funds will ensure FAS has the ability to carry out its mission to link U.S. agriculture to the world to enhance exports and global food security. An increase of $ 3,430,000 for the International Cooperative Administrative Support Services (ICASS) and Other Agreements. FAS has no administrative staff overseas. Instead, FAS relies on the administrative and support services provided by the DoS and U.S. Agency for International Development. The ICASS system is the principal means by which the DoS provides and shares the cost of common administrative support to FAS and other foreign affairs agencies at its more than 200 diplomatic and consular posts overseas. Major factors contributing to higher ICASS costs in 2011 are increased pay allowances for DoS staff for danger pay and high threat posts, rapidly increasing costs of operating New Embassy Compounds, growth in ICASS direct hire positions, increased compensation for locally employed staff providing ICASS services, overseas comparability pay for Americans providing ICASS services, and other increased DoS personnel costs. - An increase of $4,004,000 for Overseas IT Network Support and Maintenance by Dos. Strong security for FAS IT systems is essential because of the sensitivity of the information that is handled by the agency. For example, an estimated 34 percent of U.S. agricultural pricing data is derived from information and support provided by FAS. An October 2008 security analysis identified substantial 824 31-9 risks to USDA and other U.S. Government networks resulting from FAS’ international network operation and configuration. Issues that compromise FAS’ international network security include: • Reliance on local Internet service provider connectivity at the posts which does not provide the level of security required by federal government organizations; - Insufficient security measures to address present and future security risks; Extensive security compromises of overseas hosts; Outdated network equipment; and - Lack of on-site FAS IT expertise at posts. : To correct these problems, USDA's Chief Information Officer has directed FAS to transfer all oversea IT network support and maintenance responsibilities to the DoS by 2011. This will allow FAS to take advantage of the secure information system infrastructure that is operated and maintained by the DoS, Because the DoS has an average of twenty times more users per post than FAS they will be able to provide a secure, cost effective computing environment. DoS will add FAS to its Sensitive But Unclassified (SBU) network in all collocated locations and extend SBU network access to locations where FAS and DoS are not collocated. All networking components, including routers, firewalls, intrusion detection, egress filtering, other security measures as required, email, file services, managed Internet access, Blackberry support, telephone support, and required cabling will be fully supported by DoS. All FAS staff will utilize a certified workstation that will be routinely patched and scanned and will adhere to OMB-mandated Federal Desktop Core Configuration standards. DoS staff will provide on-site workstation support. For brevity and clarity, a single line reference to the FY 2011 Pay Raise, ICASS and Overseas IT Security requirements discussed above is included for each budget activity. The allocation between programs generally follows the percentages below: - Goal 1: Agricultural Exports. 65% . New Technologies - 13% Goal 2: Food Security. * a a m ....20% Climate Change . . . . 2% Total ... a g º & º ................ 100% tº k iſ ki; Project Statement by Program (On basis of appropriation) ($000) 2009 Actual 2010 Budget 2011 Estimated Staff Staff Increase or Staff Program Activity Amount Years Amount Years Decrease Amount Years Agricultural Exports $111,811 496 $122,672 533 +$59,283 (1) $181,955 533 Agricultural Exports A substantial portion of U.S. agricultural cash receipts come from export sales, making the vitality of rural America heavily dependent on international trade. U.S. farmers and ranchers are among the most productive and efficient in the world. However, they face complex and unfair obstacles in the global marketplace, where 95 percent of the world’s consumers live. A cooperative effort with the U.S. industry is needed to ensure that the U.S. farmer has fair market access, a strong understanding of key market trends, and support in overcoming constraints such as tight credit in international markets. 825 31-10 Unfair trade barriers limit U.S. sales to many countries. As tariffs and other traditional trade barriers have been negotiated away, many importing countries have begun to erect new trade barriers using unscientific plant and animal health requirements and other technical barriers to limit trade. Removing existing barriers, while ensuring new ones are not introduced, will directly help rural America thrive. U.S. producers are not guaranteed a role in the global marketplace. Successful marketing strategies depend on a strong understanding of market trends, such as rising incomes in China and India that stimulate demand for a more nutritious and varied diet. As markets change, farmers need the tools to introduce new products o new customers, maintain current sales in the face of new competition, and overcome constraints such as tight credit. - Justification for Increases and Decreases 1. An increase of $59,283,000 for Agricultural Exports ($122,672,000 available in 2010) consisting of: A. An increase of $10,000,000 for a government-wide National Export Initiative. The future of U.S. agriculture is tied to trade, which benefits the U.S. economy. In concert with the interagency Trade Promotion Coordinating Committee (TPCC), FAS will work with and through U.S. farm groups, state departments of agriculture and state regional trade groups, agricultural trade and industry organizations to draw on all available expertise to accomplish the expansion of export objectives. This provides additional funding as part of a National Export Initiative to include: • Continued funding for the FAS Posts’ Country Strategy Support Fund (CSSF) as the primary tool for implementing Departmental strategies at the country level and providing posts with the means and latitude to carry out priority activities that help achieve the strategic goals of FAS and USDA. The CSSF was developed, expanding on the former Annual Marketing Plan, to provide Posts with greater latitude to design activities that address broad strategic goals. These areas include: market access, including sanitary and phytosanitary (SPS), technical barriers to trade (TBT), and biotech issues; market knowledge and intelligence; trade capacity building; food security; strategic communication; and traditional market development; • Linking foreign buyers with U.S. exporters through expanded support of foreign buyers to attend major U.S. and international food and agricultural trade shows profiling U.S. products, with enhanced trade services, such as arranged one-on-one meetings and visits to food processors, retail outlets and agricultural production facilities; • Supporting state organized trade missions to visit foreign markets and meet directly with prospective buyers and consumers to promote their products and educate U.S. companies on doing business overseas; - • Providing funding for FAS-initiated export education programs, such as trade education seminars with Land Grant universities, participation in trade-related conferences and meetings, and a direct mail campaign, to enable FAS to capitalize on available personnel and information resources to reach out to stakeholders and potential new exporters to promote the importance of trade and trade opportunities through speeches, presentations, seminars, conferences, and other events; and - - • Meeting higher overseas operating expenses to ensure that FAS Overseas Posts have sufficient funding to achieve successful implementation of the National Export Initiative. B. An increase of $34,500,000 for the Foreign Market Development Program. This will provide additional discretionary funding for the Foreign Market Development Program as part of the National Export Initiative. This funding will be in addition to the $34.5 million of CCC funding to be made available for the program. Under this program, cost-share assistance is provided to nonprofit commodity and agricultural trade associations to support overseas market development activities that are designed to remove long-term impediments to increased U.S. trade. These activities 826 31-11 include technical assistance, trade servicing, and market research. Increasing this funding level in 2011 will provide new opportunities for participation and innovative activities, as well as provide a better balance in the funding levels among FAS’ market development programs. C. An increase of $9,000,000 for Technical Assistance for Specialty Crops. This will provide additional discretionary funding for the Technical Assistance for Specialty Crops (TASC) Program as part of a National Export Initiative. This funding will be in addition to the $9.0 million of CCC funding to be made available for the program. TASC is designed to address unique barriers that prohibit or threaten the export of U.S. specialty crops. Under the program, grants are provided to assist U.S. organizations in activities designed to overcome sanitary, Phytosanitary, or related technical barriers to trade, Increased funding for the program reflects the growing importance of specialty crops for U.S. agricultural export growth and the contribution that the program has made in resolving numerous trade barriers. D. An increase of $905,000 to cover higher personnel compensation costs associated with the anticipated FY 2011 pay raise; E. An increase of $2,231,000 for higher ICASS payments to DoS; F. An increase of $2,587,000 for overseas it support; and G. An increase of $60,000 for administrative expenses of the Export Credit Guarantee Program. Project Statement by Program (On basis of appropriation) ($000) 2009 Actual 2010 Budget 2011 Estimated Staff Staff increase or Staff Program Activity Amount Years Amount Years Decrease Amount Years New Technologies $21,415 95 $23,406 101 +$1,101 (2) $24,507 101 New Technologies U.S. farmers are taking full advantage of biotechnology and other new technologies to increase their productivity. They are also expanding production of organic products in response to growing consumer demand. Commercialization of U.S. products from cloned animal progeny, genetically engineered animals, and nanotechnology is increasing significantly. However, trade in these products has been slowed by other countries’ failure to provide timely approvals for new technologies and standards for organics. Unchecked, this situation will worsen as more and more biotech crop varieties and other new technologies are adopted by U.S. agriculture without being approved abroad. In 2009, approximately 85 percent of the corn, 55 percent of the cotton, and 91 percent of the soybeans planted in the United States were biotech varieties. An estimated 80 percent of U.S. food products contain biotech ingredients and could be negatively affected by restrictive labeling measures, testing requirements, or outright bans. Exports of these crops and other foods produced or processed using modern biotechnology form the core of the U.S. agricultural exports that totaled $96.6 billion in 2009. - - - Justification for Increases and Decreases 2. An increase of $1,101,000 for New Technologies ($23,406,000 available in 2010) consisting of A. An increase of $173,000 to cover higher personnel compensation costs associated with the anticipated FY 2011 pay raise; - 827 31-12 B. An increase of $422,000 for higher ICASS payments to DoS; and C. An increase of $506,000 for overseas IT support. Project Statement by Program (On basis of appropriation) ($000) 2009 Actual 2010 Budget 2011 Estimated Staff Staff Increase or Staff *rogram Activity Amount Years Amount Years Decrease Amount Years Food Security $34,490 153 $37,825 173 +$17,946 (3) $55,771 173 ood Securit lobal food insecurity affects people worldwide. With over one billion hungry, the current global conomic downturn exacerbates the problem. Food security exists when food is available, accessible, and ppropriately used. Food assistance alone is not enough; food availability is also dependent on food trade d in-country production. The biggest causes of insufficient in-country production are chronic under- - nvestment in agriculture, inefficient use of inputs and markets, and poor governance. o address food insecurity, states must improve the entire value chain from farm to table, increasing roduction, improving the efficiency of inputs, reducing post-harvest losses, adding value, and supporting echanisms that encourage local, regional, and international trade. Food security must be country-driven d focused at the local and community levels, ailing agricultural systems and food shortages are fueling political instability in the developing world. his instability is increasingly undermining global stability and threatening U.S. security. The United tates therefore has a strong interest in promoting competitive agricultural systems in the developing world, articularly in counties like Iraq and Afghanistan. The United States is in a unique position to coimbat lobal hunger. Our farmers and scientists are among the most productive and advanced in the world, roducing bountiful supplies of staple foods like wheat, rice and soybeans, which meet immediate food eeds around the world, and developing new innovative crop technologies and farming techniques. ustification for Increases and Decreases 3. An increase of $17,946,000 for Food Security ($37,825,000 available in 2010) consisting of: A. An increase of $1,500,000 to fund Borlaug and Cochran programs. This funding will improve FAS’ capability to provide technical assistance and capacity building programs, including in-country, third-country, and U.S.-based training programs, as appropriate. FAS would increase the Cochran Fellowship Program and the Norman E. Borlaug International - Agricultural Science and Technology Fellows Program to support USDA’s efforts to improve world food security. - * - The Cochran and Borlaug Fellowship Programs are essential agricultural development tools that advance U.S. government food security and stabilization programs in such priority countries as Afghanistan, Pakistan and Haiti. In Afghanistan and Pakistan these exchange programs train agricultural extension agents, veterinary officials, and agricultural researchers to support food production and regional trade. In Haiti, another priority country, both programs are focusing on development of the mango sector as a key component of a new U.S. strategy that aims to put Haiti on a 828 31-13 competitive path of economic growth. Globally, there is an urgent need for capacity building in the arena of food security, especially in countries such as Nigeria, Ghana, Mali, Senegal, Liberia, and Ethiopia. - B. An increase of $14,600,000 to fund agricultural reconstruction and stabilization activities. This request moves funding for agricultural reconstruction and stabilization activities from Departmental management to FAS and includes a $1,600,000 increase to cover cost-of-living increases and higher administrative expenses for agricultural development work, primarily in Afghanistan. C. An increase of $279,000 to cover higher personnel compensation costs associated with the anticipated FY 2011 pay raise; D. An increase of $725,000 for higher ICASS payments to DoS; and E. An increase of $842,000 for overseas IT support. Project Statement by Program (On basis of appropriation) ($000) - 2009 Actual 2010 Budget - 2011 Estimated Staff Staff Increase or Staff Program Activity Amount Years. Amount Years Decrease Amount Years Climate Change $2,705 12 $2,929 12 +$143 (4) $3,072 #2 Climate Change Cap and Trade programs offer the hope of addressing climate change, promoting competitive production and supporting farm income. However, throughout the world variations of the Cap and Trade system are i development, creating concern that some of the new schemes will evolve into protectionist programs that limit trade based on social criteria rather than objective scientific criteria. It will be critical to take a truly global approach and connect that approach to individual U.S. farmers. Voluntary carbon markets that trade “carbon offsets” have been in existence since 2005 and were valued at $331 million in 2007. Trading in carbon offsets by U.S. farmers has held a domestic focus, using the Chicago Climate Exchange (CCX). There has not yet been full exploration of the global market's potential long-term economic benefits for the U.S. farmer. Justification for Increases and Decreases 2. An increase of $143,000 for Climate Change ($2,929,000 available in 2010) consisting of: A. An increase of $22,000 to cover higher personnel compensation costs associated with the anticipated FY 2011 pay raise; - B. An increase of $52,000 for higher ICASS payments to DoS; and C. An increase of $69,000 for overseas IT support. istrict of Columbia...................... Total, Available or Estimate.............. FOREIGN AGRICULTURAL SERVICE Geographic Breakdown of obligations and staff Years 2009 Actual and Estimated 2010 and 2011 2009 Staff Amount Years $112,739,101 710 57,681,899 241 $170,421,000 95.] 2010 Staff Armount Years 117,506,426 765 69,325,574 241 $186,832,000 1,006 2011 Staff Amount Years 176,397,868 765 88,907,132 241 $265,305,000 1,006 830 31-15 FOREIGNAGRICULTURAL SERVICE Salaries and Expenses Classification By Objects 2009 Actual and Estimated 2010 and 2011 2010 Personnel Compensation: 2009 2011 Washington, D.C $40,540,135 $49,615,618 $56,949,507 Field: 32,948,865 33,904,382 34,819,800. 11 Total personnel compensation................. 73,489,000 83,520,000 91,769,307 12 Personnel benefits 22,038,000 25,947,000 28,076,693 13 Benefits for former personnel.................. 184,000 184,000 184,000 Total pers. comp. & benefits.................. 95,711,000 109,651,000 120,030,000 Other Objects: 21 Travel 6,249,505 6,250,000 6,750,000 22 Transportation of things....................... 171,290 171,000 221,000 23.2 Rental payments to others..................... 6,967,565 6,968,000 6,968,000 23.3 Communications, utilities and miscellaneous charges.................. 1,107,729 1,108,000 1,108,000 24 Printing and reproduction..................... 312,304 312,000 412,000 25.0 Other Services 170,118 171,000 171,000 25.1 Departmental services 1,855,662 1,856,000 11,456,000 25.2 Other services 46,372,145 48,841,000 57,835,000 25.3 Maintenance 367,978 368,000 368,000 25.4 Market Promotion 188,840 189,000 5,439,000 25.5 Cooperative Agreements...................... 4,675,518 4,676,000 48,176,000 25.8 Subsistence & Support of Persons 275,000 275,000 275,000 26 Supplies and materials.......................... 4,645,166 4,645,000 4,745,000 31 Equipment - 887,274 887,000 887,000 41 Grants, Subsidies and - Contributions 463,906 464,000 464,000 Total other objects 74,710,000 77,181,000 145,275,000 Total direct obligations 170,421,000 186,832,000 265.305.000 Position Data: Average Salary, ES/FE Positions................ $170,298 $173,704 $177,351 Average Salary, FO/FP Positions................ $112,509 $114,759 $117,169 Average Salary, GS/GM/FSN Positions...... $76,985 $78,525 $80,174 Average Grade, GS/GM/FSN Positions...... 1 i.8 I 1.8 11.8 831 FOREIGN AGRICULTURAL SERVICE 31-i6 Salaries and Expenses SUMMARY OF RECOVERY ACT FUNDING Pro oiect/Activi Trade Adjustment Assistance for Farmers Unobligated Bal Total Appropriated Trade Adjustment Assistance for Farmers Unobligated Balance brought forward from prior Unobligated Balance brought forward to next year Total Available or Yº...s.º. *. 2009 2010 2011. $25,000,000 $90,000,000 $22,500,000 65,000,000 0. 0 $90,000,000 $90,000,000 $22,500,000 Project Statement - Recovery Act (On basis of available funds) 2009 Actual 2010 Estimated Increases 2011 Estimated * Staff * Staff Gr º Staff Amount Years. Amount Years; Decreases Amount | Years $25,000,000 || 1 || $25,000,000 || 1 || -$2,500,000 $22,500,000 I {} -- -65,000,000 -- -65,000,000 || -130,000,000 || -- 65,000,000 -- || 130,000,000 || -- {} 130,000,000 * 90,000,000 | 1 90,000,000 1 -67,500,000 22,500,000 l a. Goals and Coordination Efforts: Goals. The Trade Adjustment Assistance (TAA) for Farmers program helps producers of raw agricultural commodities and fishermen adjust to a changing economic environment associated with import competition through technical assistance and cash benefits. Coordination. FAS, National Institute of Food and Agriculture (NHFA), and Farm Service Agency (FSA) program managers will be responsible for implementing, improving, and monitoring program activities, individual performance plans of FAS managers are tied to the Agency mission and goals contained in the FAS Strategic Plan. FAS will monitor overall program execution. NIFA will monitor the delivery of technical assistance projects and the Training Coordination entity will report directly to NIFA as well as to FAS. FSA will monitor the individual producer application process and the development and functioning of IT and software requirements on a daily basis and will coordinate with the Training Coordination entity. Field reviews will also be conducted on a quarterly basis by involved agencies, commencing with the certification of group petitions. b. Objectives: The TAA for Farmers Program provides technical assistance and cash payments to assist qualified farmers and fishermen, adversely affected by imports, in adjusting their business operations to either be more competitive-with imported products or to switch to production of commodities that could be more profitable. Benefits. The TAA for Farmers program will provide free technical assistance to producers of agriculture products, aquaculture products, and fishermen to assist them in becoming more competitive with imports of like products, Qualified producers will receive initial technical assistance training, intensive technical assistance training, and assistance in the development of an initial business plan and a long-term business adjustment plan. The Extension Service, NIFA, will provide technical assistance through their university partners located in the geographic region associated with the certified petition. Cash payments of up to 832 31-17 $4,000 after the completion of an approved business plan, and up to $8,000 for the implementation of an approved long-term business plan, will be paid to participants through FSA. c. Delivery Schedule: Implementation of the TAA for Farmers Program will be conducted to accomplish all milestones simultaneously. Milestone: Development of Program Regulation, Group Petition Certification, and Producer Application; • Activity includes development of a Final Rule for implementation of the program, receipt of commodity specific petitions from producer groups, and receipt of applications under certified petitions from individual producers. Milestone: Development and Implementation of Outreach Plan; and • FAS, NFA, FSA, and the Agricultural Marketing Service (AMS) will all be involved in the outreach effort. A plan is being developed to outline the outreach strategy for this program and the involvement of these agencies in its execution. FAS has established a website for TAA for Farmers which is now linked to USDA, FSA, NIFA and AMS websites. The plan calls for proactive outreach to producers, producer organizations, state departments of agriculture, USDA employees at local USDA Service Centers, and extension educators at State universities and county offices. Accepted and certified petitions will be announced via Federal Register Notice, USDA press releases and website postings. The Training Coordination entity will also be engaged in providing outreach in coordination with federal TAA for Farmers agencies to all county Extension offices in the United States; the program information will explain program purpose and will be communicated in hard copy as well as through electronic In eanS. Milestone: Development of Information Technology Requirements and Grant Agreement Execution. • FSA is in the process of defining software requirements for management of producer applications and payments. NIFA is in the process of developing requirements for competitive request for applications for university partners receiving grants to organize and implement the delivery of technical assistance. d. 2009 Accomplishments: The proposed rule for the TAA for Farmers program and the opening of a 30- day public comment period was published on August 25, 2009. The interim rule for the TAA for Farmers program, which allows the program to be implemented immediately and provides for an additional 30-day public comment period, has been drafted to incorporate comments received during the proposed rule public comment period and is undergoing final inter-agency review. After that review is complete, the program will be announced and petitions may be submitted for consideration of benefits. The TAA for Farmers programs provides for $90 million in each of FY 2009 and FY 2010, and $22.5 million for the first three months of FY 2011. Obligations under the program totaled $25.0 million in FY2009. All FY2009 obligations were administrative costs associated with running the program, particularly the establishment of the training component for the program ($17 million) and the establishment of the software for administering the petition, application, and payment phases of the program ($5 million). e. 2010 and 2011 Planned Activities: The ARRA of 2009 reauthorized and modified the TAA for Farmers program. Producers of a commodity who have recently suffered a greater than 15 percent decrease in the national average price, the quantity of production, value of production, or cash receipts compared to the average of the 3 preceding marketing years, and imports contributed importantly to this decline, may be eligible to receive free information, technical assistance, and cash payments to develop and implement business adjustment plans from the TAA for Farmers program. A total of $202.5 million has been authorized for the program, with $90 million per year for the 2009 and 2010 fiscal years, and $22.5 million for October through December 2011. These funds will be used for developing and implementing approved Extension training programs, as determined by NIFA, for cash payments to producers for development and implementation of business plans, and for USDA administration of the program. Eligible producers who develop an approved business plan, with guidance from educators working under approved Extension programs, are entitled to receive a cash payment of up to $4,000 to implement the initial business plan or develop a long-term business plan. Producers who subsequently develop approved longer-term business plans are entitled to receive an additional cash payment of up to $8,000 to implement their long-term plans. 833 31-g! FOREIGN AGRICULTURAL SERVICE STATUS OF PROGRAM SUMMARY OF AGRICULTURAL TRADE In FY 2009, U.S. agricultural exports reached $96.6 billion, a significant decline from the previous year's record of $115.3 billion. The factors causing the fall in exports included, among others, falling commodity prices and weak demand resulting from the global recession. Nevertheless, exports were the second highest ever despite the recession's significant impact. The outlook for FY 2010 shows exports rebounding slightly and continuing the last decade's upward trend with sales at $98 billion. While the FY 2010 forecast is down from the record level seen 2 years ago, the forecast is still the second highest on record. - Overseas markets remain vital to U.S. farmers. For many agricultural products, exports account for a substantial portion of domestic production (on a volume basis). Exports are also an important source of income for food processing companies, packaging materials companies, transportation, and other related industries. U.S. Agricultural Trade Led by a recovering global economy and record horticultural exports, 2010 exports are forecast to be the second highest on record while strong imports lead to a marginal reduction in the trade surplus - $120 ... -- - - - - - ... . . . . . . . . . . ~~~~ : $1 1 0 - $1 OO *** * * * **** * ***** * * * * * *- : * * * * * ****** * -rº. - %---a ... * * * * * * * ... * * * * * • * : * . * * * * * * * * * * . * * * * * * * * * * * *- : . . . . . . . . . . . $80 - - $70 . . . . . 59 8 $60 ****** ****- : *...* * * **** **** -º- 'º-4**** *-*-* *-*. /N $50 ---~~~~~ Exports/Kºº xx º *º $40 zºº A-AN "...ºrº ** F. $30 - - *N - - $20 &ºtiºn--- . . . * * ‘. . º . . . . . ; º, tº - *; ; ; ; ; º ºr i ≤ tº . . . . º.º. ;: º d tº . . . *** i Trade Surplus ...; 0 -- * . . . . . . . - . . . . . . ..": . . . . . . - ‘88 '90 '92 '94 '96 '98 (30 “O2 '04 '06 '08 '? Of ote: Forecasts are based on USDA's “Outlook for U.S. Agricultural Trade” published on November 30, 2009. Source of trade ata: the U.S. Bureau of the Census. Y 2010 agricultural imports are forecast at $77.5 billion, up $4.1 billion from last year's $73.4 billion in imports. e weak economy and low commodity prices in 2009 resulted in a record drop of nearly $6 billion from the revious year. In 2010, a rebound in imports is expected with a modest recovery in spending by consumers and igher prices for some high-value commodities, The trade surplus in agricultural commodities is expected to fall to 20.5 billion. - ! he overall increase in the agricultural export value for FY2010, compared to the previous year, reflects a boost in emand for U.S. high-value products such as meat and dairy products, fruits and vegetables, and tree nuts. orticultural product exports are forecast to reach a record $21.5 billion over last year. Gains in these high-value roducts are expected to more than compensate for slightly lower exports of bulk commodities such as grains and oilseeds. While volumes for these bulk commodities are expected to rise due to plentiful supplies, lower prices should account for overall value reduction. - - - 834 31-gº Bulk commodity exports are forecast at $35.5 billion in FY 2010. Total bulk export volume is forecast up, with coarse grains and wheat accounting for most of the increase. Compared to the previous year, the highlights for FY 2010 are: Grains. Wheat and coarse grain exports are forecast at $16 billion. Large exportable wheat supplies in nearly every competing country except Argentina have created intense competition. Meanwhile larger wheat crops in North Africa, the Middle East, and South Asia limit global import demand and put downward pressure on prices. Coarse grain export volumes are expected up as a record U.S. crop and weaker competition from Russia and Ukraine combine with less global wheat feeding. While prices for all grains are forecast lower, the increased volumes lead to little overall change in the export value. Export Outlook for Top 10 U.S. Agricultural Product Groups Soybeans a E.--- Corn Wheat J Fruits/Vegs, fresh ſ Fruits/Vegs, proc. * Feeds!Fodder C] FY'09 T I s t I I I l 0 2 4 6 8 10 12 14 Ranking based on 2009 values Billion Dollars Soybeans. Soybean exports are forecast at $13.2 billion. A record U.S. harvest combined with very strong demand from China and less early seasonal competition from South American supplies is expected to lead to volume gains. However, large global supplies resulting in lower unit values will more than offset the slightly higher volumes. - Cotton. Cotton exports are forecast at $3.3 billion, a fall of $300 million from the previous year, as a decline in export volume is only partially offset by higher unit values. A smaller U.S. crop and greater competition are expected to impact volume levels. However, falling U.S. ending stocks and recovering global demand should put upward pressure on prices. China remains the largest buyer and largest source of demand growth. High-value product exports are forecast at $62.5 billion in FY 2010, signaling stronger foreign demand as the global economy recovers from the recession. Oilseed product exports are forecast to increase $400 million while animal product exports are forecast at $19.9 billion. Horticultural exports, which include all fresh and processed fruits, vegetables, tree nuts, and wine, are forecast up $900 million to a record $21.5 billion. Compared to the previous year, the highlights for FY 2010 are: Feed and Oilseed Products. Soybean meal export volume is expected to increase due to less competition from South American supplies, although lower unit values will outweigh the increased volumes, Soybean oil exports are forecast to rise $500 million in FY 2010 due to increased shipments as rising biodiesel production in Brazil and Argentina limits competition. Feed and fodder exports are forecast up $100 million as stronger volume shipments are mostly offset by lower unit values, - Animal Products. The export forecast for livestock, poultry, and dairy products is $19.9 billion, up more than $1 billion from last year. The increase is due to expected improvement in global economic conditions, which should drive demand growth across most of the livestock product sector. Pork exports are forecast to reach $4 billion largely due to greater volume, Beef exports are forecast at $2.8 billion, mostly on higher volume, but also some gains in unit value as general global economic recovery bolsters demand, Poultry exports are 835 31-g3 forecast down slightly to $4.5 billion due to greater broiler meat competition from Brazil and reduced turkey meat demand from Mexico. Dairy exports are expected to grow to $2.6 billion as global demand recovers and international prices rebound. . - Horticultural Products. Horticultural product exports are forecast to rise $900 million to a record $21.5 billion. Fresh fruit and vegetable exports are forecast at a record level, as export value to Canada, Mexico, and Japan increases. Demand from top markets will push processed product exports. Tree nut exports are forecast to grow slightly to $3.6 billion as demand from Asian and European markets continues to grow while record U.S. almond stocks will help the industry meet foreign demand. TOP EXPORT MARKETS The top five markets account for 62 percent of U.S. agricultural exports. U.S. agricultural exports to our North American Free Trade Agreement (NAFTA) partners, Canada and Mexico, are forecast at $29.7 billion. U.S. exports to Canada, our largest foreign market, are forecast to increase a modest $200 million to $15.7 billion. Canada's economy is coming out of a recession and its high-income consumers should demand more high-value products, especially fresh and processed fruits and vegetables, many of which come from the United States. Higher prices for horticultural exports to Canada contribute to much of the increased value expected. Sales to Mexico, our second largest market, are forecast at $14 billion. Exports to this market are a mix of bulk grains, soybeans, and cotton, as well as high-value products such as meats, dairy products, snack foods, and fruits. The annual increase of nearly $500 million is due to more high-value shipments as the economy rebounds as well as higher prices for these high- value products, - - Export Outlook for Top 5 U.S. Markets ...ºf ...ºp ... mºm, ſº . C} FY'09 a. * - a. * Q 5 10 Billion Dołłars 15 . . 20 Ranking based on 2009 values U.S. agricultural exports to Asia are expected nearly unchanged from last year at $38 billion or 39 percent of the total. Lower bulk commodity prices are offset by gains in high-value products. Sales to Japan, our third largest market, are forecast at $11.3 billion while sales to China, our fourth largest market, are forecast at $11.2 billion. The forecast for China is similar to last year as greater soybean shipments are offset by lower soybean unit values and reduced cotton shipments, U.S. agricultural exports to the European Union (EU)-27, our fifth largest market, are forecast at $7.7 billion or 7.5 percent of total exports. - COMMODITY IMPORT HIGHEIGHTS With more than 300 million of the world's most affluent consumers, the U.S. food market is second only to the EU in total food expenditures. Strong demographic characteristics, combined with a demand for year-round availability of fresh fruits and vegetables, an appetite for diversity and luxury products, and a relatively open market make the United States a top priority for food manufacturers around the globe. Prior to 2009, U.S. agricultural imports had risen steadily for the past 4 decades. From FY 2003-2008, the import value had grown at roughly twice the historical rate. However, 2009 saw the largest drop ever in imports due to 836 31-g3 lower commodity prices and reduced demand resulting from the recession. Imports are expected to rebound in 2010 to $77.5 billion as demand recovers and prices for key imported products increase. - The overall import outlook for FY 2010 reflects an expected modest recovery in consumer spending and higher import prices for some high-value products. Horticulture products and tropical products will lead all categories in increased imports. Horticultural and High-Valued Products. Imports are forecast to rise to a near record $34,4 billion. Modest gains are expected for all product groups but with fresh fruit expected to see the largest increase over last year as unit values rise along with volumes. Grains, Oilseeds, and Products. Imports are forecast up $850 million to $13.6 billion. Much of the increase is due to higher vegetable oil import prices though volumes are also expected up. Cattle and Swine. Imports are forecast to increase $400 million to $1.8 billion while dairy product imports are expected to increase $300 million. Tropical Products. Imports are forecast to increase $1.2 billion to a record $16.5 billion as tropical product prices rise. The price of cocoa beans has exceeded the 2008 highs and sugar prices are exacerbated by supply problems in Brazil and India. Coffee bean imports are forecast up $200 million as prices continue to pick up. Rubber prices from Malaysia are also heading higher and, coupled with greater demand as U.S. auto production and car sales rebound, are forecast to push rubber imports to $2 billion. TOP FOREIGN SUPPLIERS The top five suppliers in descending order are Canada, the EU-27, Mexico, China, and Brazil. Forecast to increase $2.1 billion to a record $42.2 billion in FY 2010, the Western Hemisphere accounts for 55 percent of the total import bill. Europe/Eurasia, with an expected increase of $600 million, rises to $15.1 billion or 20 percent of the total. Asia, with an expected increase of $1.2 billion, rises to $13.2 billion or 17 percent of the total. CURRENT ACTivities The Foreign Agricultural Service (FAS) budget activity structure reflects core agency priorities and areas of emphasis identified through the FAS organizational review. The structure incorporates the agency’s goals that U.S. farmers, ranchers, and agricultural industry maintain and expand exports, and U.S. agriculture’s resources support food and national security policies, in line with the USDA Strategic Plan. AGRICULTURAL, EXPORTS Because a substantial portion of U.S. agricultural cash receipts come from export sales, the vitality of rural America is heavily dependent on international trade. U.S. farmers and ranchers are among the worlds most productive and efficient. However, they face complex, unfair obstacles in the global marketplace, where 95 percent of the world’s consumers live. A cooperative effort with the U.S. industry is needed to ensure the U.S. farmer has fair market access, a strong understanding of key market trends, and support in overcoming constraints such as tight credit in international markets. - Market Access Greater access to foreign markets for U.S. agricultural producers requires an aggressive trade policy to lower tariffs, reduce non-tariff barriers, eliminate export subsidies, and reduce trade-distorting domestic subsidies. FAS works with other USDA agencies, the United States Trade Representative (USTR), and others in the United States Government (USG) to negotiate new trade agreements and to monitor and enforce existing trade agreements. On a continuing basis, FAS Attachés and analysts in Washington, covering more than 150 countries worldwide, resolve trade problems involving U.S. products and provide country and regional intelligence to support U.S. exporters and agricultural producers. Notable achievements in these areas in FY 2009 include: 837 31-g5 - Doors Open to U.S. Beef from Cattle of All Ages. In 2009, the United States continued to press at every opportunity to expand market access consistent with World Organization for Animal Health (OIE) guidelines that allow U.S. beef and beef products from cattle of all ages. The OIE’s 2007 classification of the United States as "controlled risk" for bovine spongiform encephalopathy (BSE) has been a cornerstone of these efforts. During January through September 2009 exports of all U.S. beef and beef products reached $2.3 billion, heading toward the second highest annual level since 2003. In FY 2009, Chile, Jordan, Nicaragua, and St. Kitts joined the growing list of countries that comply with OIE standards, and Taiwan made significant progress by announcing on October 23, 2009, its intention to comply with OIE guidelines. The normalization of the beef trade after the market closures caused by the findings of BSE in the United States beginning in 2003 has been the largest single technical trade issue of concern to USDA for the past few years. - - U.S. High Quality Beef Gains Greater Access to EU. After more than 20 years of contentious disputes, in May 2009 the USTR concluded an agreement with the European Commission that will substantially expand opportunities for U.S. cattlemen to sell beef to Europe. The agreement is fragile, but if it endures beyond the initial 3-years of implementation, duty-free access will jump from 20,000 to 45,000 metric tons (MT) of high- quality, high-value beef to this very lucrative market. FAS support has been vital to these efforts since the EU first banned imports of meat from cattle treated with hormones in January 1989. - - FAS Prevents Ban of U.S. Meat and Poultry Combo Bins in Mexico. An agreement reached in January 2009, significantly reduced the impact on U.S. exporters of a Mexican ban on imported meat combo bins by limiting the ban to frozen combo bins. Few U.S. combos arriving in Mexico are frozen. In March 2009, representatives from FAS, the Food Safety and Inspection Service, the Canadian Food Inspection Service and the Mexican government observed combo inspections in the Detroit Toronto area. The visit reassured Mexico by providing a firsthand look at how NAFTA partners carry out inspections on the U.S./Canada border. The United States exports over $664 million of pork, beef and turkey to Mexico in combos annually, -- H1N1 Bans of U.S. Pork Rescinded in 22 Countries. In 2009, the mischaracterization of pandemic H1N1 influenza as “swine flu” led many countries to ban live pigs and pork products from the United States. FAS led an interagency effort to engage trading partners on the issue, including facilitating announcements by the OIE and the World Health Organization (WHO) on pork safety, ultimately resulting in the lifting of non-scientific meat bans in 22 countries that accounted for over $700 million of U.S. pork exports in 2008. - U.S. Specialty Crops overcome Pesticide-Related Trade Barriers in Asia. In July 2009, FAS negotiated a Memorandum of Understanding (MOU) with Japan, which has played a key role in resolving pesticide maximum residue limit (MRL) trade barriers that affect U.S. agricultural commodities. The MOU protects over $800 million in U.S. specialty crop exports from unwarranted import sanctions imposed on U.S. suppliers, and culminates 3 years of negotiations with Japan under the Regulatory Reform Initiative trade policy forum. In addition, FAS protected over $300 million in U.S. agricultural trade by encouraging Taiwan to address its MRL application backlog. Since December 2008, Taiwan has approved over 200 MRLs that are priorities to the U.S. agriculture industry. In September 2009, FAS persuaded Thailand to suspend the implementation of a superfluous regulation requiring 100 percent test and hold of fresh fruit and vegetables imports that affected $30 million in U.S. exports of perishable products. - . - EU Accepts International Standard on Wood Packaging Material (WPM). In the fall of 2008, FAS and Animal and Plant Health Inspection Service (APHIS) successfully pressed the EU to harmonize its debarking standards on wood packaging material with the international standard (ISPM-15), and delay their January implementation of new regulations until July 2009. In March 2009, the International Plant Protection Convention adopted the revised ISPM-15 that sets a global standard for debarked wood. Fifty percent of the United States’ $286 billion exports to the EU are shipped with WPM and thus affected by these measures. FAS has continued to coordinate an industry-interagency strategy to engage trading partners in support of a revised international standard acceptable to the world’s largest traders. - -- Asian Food Safety Laws Modified in Favor of U.S. Exporters. In 2009, FAS mitigated the trade impact of nonscientific food safety legislation imposed without notification by many countries in response to anxiety over melamine, salmonella, and H1N1. FAS convinced foreign counterparts to notify, delay and even modify legislation to reduce the burden on U.S. exporters. For example, following numerous USG meetings with senior 838 31-gó Chinese officials in Beijing, and a Washington meeting of China’s Food Safety Director with 60 USG and industry representatives, China agreed to accept U.S. products without new labels, waived new meat and poultry inspection requirements, and continue pre-existing standards for processed foods and additives. This prevented a $95 million decrease in consumer-ready food exports, saved the industry $3 million in repackaging charges, and achieved the release of $1.5 million of detained U.S. goods. Similar successes were achieved in Vietnam and Indonesia in FY 2009. - - - Trade Development FAS supports U.S. industry efforts to build, maintain, and expand overseas markets for U.S. food and agricultural products. The Agency administers several export development programs including the Foreign Market Development (Cooperator) Program (FMD), Market Access Program (MAP), Technical Assistance for Specialty Crops (TASC) Program, Quality Samples Program (QSP), and Emerging Markets Program (EMP). These programs provide matching funds to U.S. organizations to conduct a wide range of activities including market research, consumer promotion, trade servicing, capacity building, and market access support. Working with the State Regional Trade Groups (SRTGs) and other industry organizations, FAS also encourages outreach efforts that focus on facilitating export readiness for U.S. exporters, FAS’ overseas offices also support industry efforts--especially in developing markets--by providing market intelligence and helping introduce U.S. exporters to potential foreign customers. In addition, FAS facilitates the United States’ participation in a range of international trade shows, MARKET DEVELOPMENT PROGRAMS - Grains Council Expands U.S. Exports of Distilled Dried Grains with Solubles (DDGS) to Canada. Exports of U.S. DDGS to Canada skyrocketed from a negligible amount in 2005 to 772,000 MT in 2008, and projections of 880,000 MT or $1 million in 2009 following implementation of U.S. Grain Council programs. In 2005, the Council initiated research in Canada's swine industry that demonstrated that hogs can be fed high inclusions of the ethanol co-product with minimal or no detrimental impact on pork quality, resulting in significant financial savings on feed to hog farmers. Currently, the Council is also working in the Canadian beef sector to educate end-users on the financial benefits of feeding higher rates of U.S. DDGS with no negative impact on nutrition and meat quality. This new research could save feedlot operators as much as $50 per head, -- U.S. Beef and Pork Exports Benefiting from United States Meat Export Federation (USMEF) Trainin Program in Mexico. USMEF has an ongoing strategy to provide in-depth training to the sales forces of importers and distributors to improve their effectiveness in selling U.S. red meat. These two day MAP and check off funded sales force training seminars focus on technical meat topics, proper handling practices, hands- on cutting demonstrations, merchandising techniques, and sales and negation strategies. Over the past couple of years, USMEF has provided training to about 300 employees from about 100 Mexican companies. According to surveys following the seminars, participating firms stated that on average they plan to increase purchases of U.S. beef by 30-40 truckloads during the next 12 months. Despite the down economy, U.S. beef exports to Mexico through August 2009 reached 201,970 MT valued at $636.6 million. In 2008, Mexico was the largest market for U.S. beef, with exports up 10 percent in volume to 396,065 MT, and up 18 percent in value to nearly $1.4 billion. Mexico was the third largest destination for U.S. pork, with exports up 43 percent to 396,609 MT, a 54 percent increase in value to $691 million. -- - MAP Supported Identification of Alaska Seafood Increases Sales in Japan. In June 2009, Alaska Seafood Marketing Institute (ASMI) used MAP funds to help a major seafood distributor, Aiku Company, stimulate sales of Alaskan snow crab in Japan. Alaskan seafood faces fierce competition from Canada and Russia. ASMI used MAP funds to produce special poly-bags with the ASMI logo and messaging. Aiku distributed these packages during the 2009 summer to major supermarket chain stores across Japan, including AEON Group, on of Asia’s largest retailers. In total, 130 metric tons (286,600 lbs) of Alaskan snow crab was distributed to more than 300 retail store outlets, leading to sales of $3.6 million. Identification of Alaskan origin contributes to successful Alaskan seafood seasonal promotions and has generated increased interest in using the ASMI logo in future promotions. - 839 tº tº 31-g? Small North Carolina Truffle Company Products Following to Japan. Susan Rice Truffle Products, a small North Carolina company, is new to exporting. As a result of the contacts made during a Southern United States Agricultural Trade Association's (SUSTA's) MAP sponsored trade event, the company has shipped 2,000 bags of gourmet truffle-flavored popcorn to over 100 stores in Japan. Pet Food Supplier Doubles Export Sales with MAP. Recently, New York's OmniPro Pet Food Company attended the Interzoo tradeshow in Germany, with the help from MAP. The company sold four containers of product on the spot totaling $64,000 in new sales, with projected annual sales of $240,000. Dave’s Gourmet is Turning up the Heat Around the World. Dave's Gourmet, a small San Francisco burrito restaurant with a signature hot sauce, used financial assistance from the Western United States Agricultural Trade Association's (WUSATA) MAP-funded program, to attract international buyers to their wide range of award-winning hot sauces, organic pasta sauces, and other premium condiments. These efforts have resulted in a $141,000 increase in their 2008 export sales and over a $200,000 increase in 2009. - - MAP Helps Washington Winery Launch Two Brands in the United Kingdom (UK) with Sales Reaching One Million Dollars in First Year. In 2009, over 20 Washington and Oregon members of the Northwest Wine Coalition (NWC) participated in the London International Wine and Spirits Fair, at a booth that was designed, built, and staffed with MAP funding. As a result of relationships developed there since the spring of 2008, Precept Wine Brands has shipped approximately 20,000 cases of two brands of their portfolio to the UK worth about $1,000,000, with plans for regular shipments in the future. In early June, the Co-op, a large grocery retailer, conducted a sales promotion with these two brands, which grew awareness of the wines' availability to shoppers and increased sales by approximately 15 percent over non-promotional periods. MAP Helps California Wine Win Market Share in Poland. Twelve month exports through May 2009 saw a 27 percent increase, as compared to 2008, in the value of California wine sales to Poland, putting California’s market share in Poland at 15 percent, and making it the largest supplier of wine (in value) ahead of France. California wine retail promotions at major retailers Alma, Makro, and Tesco, which Wine Institute initiated and supported with the use of MAP funding, have contributed greatly to this success. The value of California wine exports to Poland currently exceeds $26 million, MAP Helps U.S. Apple Export Council (USAEC) Maintain Presence in EU Market. MAP-funded activities have helped shippers in New York to maintain good, competitive returns for apple exports to the UK in July 2008 through June 2009, despite a crop almost half of its normal size, a global economic meltdown, and a price war between the top retailers in the UK, USAEC’s marketing activities, such as in-store product sampling and in-store merchandising, have resulted in an increase in Empire movement over 250 percent over the prior month. This undeniable boost provided by marketing efforts allowed USAEC exporters to keep pricing at or near the previous year's levels while other varieties and origins saw their pricing drop, in some cases to less than 50 percent of the prior year levels. USAEC exports to the UK in July 2008 through June 2009 were over $4 million. - FMD Results In Holstein Cattle Sales to Russia. As a result of approximately $66,000 of FMD funds spent on Holstein activities in Russia, participants expressed interest in purchasing at least 5,000 head of dairy cattle in 2009 valued at approximately $15 million. The Holstein Association USA, a member of U.S. Livestock Genetics Export, Inc., used FMD funds to bring a livestock genetics importer to the 2007 World Dairy Expo, and later to Holstein headquarters in 2008. In coordination with this importer, the Holstein Association brought a team of 18 Russian large dairy owners/buyers to tour the Wisconsin dairy industry and to attend the 2008 World Dairy Expo. The sales to be generated from this visit are expected to be approximately $15 million. TASC Helps Open Thai Market to U.S. Seed Potatoes. The U.S. Potato Board (USPB) reported that the TASC program has been instrumental in facilitating a U.S. seed potato import protocol between APHIS and the Government of Thailand, signed October 15, 2009. This protocol will allow the first U.S. seed potatoes from the key production states of Washington, Idaho, Oregon, and California to enter the market. USPB will use TASC funds to bring Thai officials back to the United States in the spring of 2010 to facilitate additional seed potato producing states to be included under the import protocol. Fueled by a rapidly growing demand for 840 31-g3 snack products, large chip-stock potato users in Thailand (manufacturer/processors) are expected to initially import $1 to $3 million of seed potatoes per year from the United States. EMP QSP Help Build Soy Markets in Nigeria. In 2009, two beverages using soy were launched on the commercial market in Nigeria, and there is growing interest in using soy in baked goods. The World Initiative for Soy in Human Health (WISHH), a program of the American Soybean Association, began working in Nigeria 2 years ago with support from USDA’s EMP. Initial efforts focused on providing technical assistance to targeted food processors and hosting conferences to bring together multiple stakeholders. A QSP request was approved the following year, enabling samples of various value added soy products to be brought into the country and utilized by targeted companies. In 2009, commercial sales of isolated soy protein and defatted soy flour have exceeded $715,000. EMP Brings About First Swaziland Notification to the World Trade Crganization (WTO). FAS received $4,500 in EMP funds to train Swaziland officials in understanding and implementing WTO notification obligations, providing regulatory transparency to decisions that impact the import of U.S. goods. Within 2 weeks following the training, Swaziland notified its first sanitary and phytosanitary (SPS) measure to the WTO. This initiative was in direct response to a request at a recent meeting of the WTO-SPS Committee, where the United States was asked to “mentor” Swaziland to improve the functioning of their WTO Enquiry Point, U.S. agricultural exports to Swaziland are valued at $2.9 million — a small but emerging market. EMP Helps Establish United States-China Pesticide Regulatory Partnership. FAS used $104,000 of EMP funds to facilitate a series of technical and policy exchanges on pesticide regulations between the U.S. Environmental Protection Agency (EPA) and their Chinese counterparts, the Institute for the Control of Agrochemicals, Ministry of Agriculture (ICAMA). FAS worked with the two agencies to develop a near-term (3 year) cooperative work plan, and implemented sixteen exchanges between the two agencies during FY 2008– 2009. Both the EPA and ICAMA have released promotional documents highlighting their relationship and the importance of international cooperation on pesticide issues, demonstrating the sincere commitments from both agencies. Additionally, the EPA document highlighted a set of new International Program Strategic Goals that included language to help “minimize unnecessary technical barriers to trade” – a significant expansion in EPA policy. With U.S. agricultural exports to China valued at approximately $12 billion (2008), it is critical that China utilizes sound, science-based, pesticide standards when inspecting and assessing U.S. agricultural products. EMP Strengthened Relationship with Chinese Inspectors, Helped to Maintain Trade. In October 2009, the China Inspection Quarantine (CIQ) in Shanghai announced that it would strictly enforce existing import regulations on U.S. poultry products arriving at a Shanghai port due to concerns on the authenticity of official shipping documents. The effect could have been a significant disruption to U.S. exports. Due to the communication and trust established through the EMP-funded technical capacity building exchanges between U.S. regulatory agencies and Chinese food safety and inspection officials, FAS was able to negotiate an agreement with CIQ whereby the United States verified certain information on questionable shipments and CIQ accepted the U.S. poultry and poultry products. This agreement has allowed more than 60 containers to enter commerce in China, worth $750,000. The $100,000 in EMP funded programs directly resulted in maintaining this trade with China INTERNATIONAL TRADE SHOWS In FY 2009, over 910 U.S. companies participated in 31 FAS-endorsed trade shows, making more than 12,540 trade contacts, reporting on-site sales totaling $74 million, and projecting an estimated $707 million in 12-month sales. More than 7,720 new products were introduced in various markets. FAS direct costs in support of these events totaled approximately $70,000. Over the past several years, FAS has successfully transferred management of U.S. pavilions at most shows to the private sector, while shifting FAS focus to negotiating the terms of management for the American Pavilion with trade show organizers and providing market information and trade contacts to U.S. exhibitors. As a result, FAS has reduced the staff time needed for show support compared to previous years. Examples of show results follow: 841 tºº 31-gº SIAL Paris 2008 Generated over $97 Million in Sales for U.S. Food Companies. From October 19-23, 2008, the SIAL food and beverage exposition, one of the world’s largest food trade shows, was held in Paris, France. Held biennially, SIAL Paris 2008 featured approximately 5,500 exhibiting companies from 104 countries, and attracted approximately 147,860 visitors from over 180 countries. The U.S. Pavilion included 126 U.S. exhibitors, food companies and trade organizations, who reported $4.2 million in on-site sales and $97.2 million in 12-month projected sales, $24.8 Million in Sales Projected at Food & Hotel China. On December 4-6, 2008, Food & Hotel China was held in Shanghai, China. Approximately 16,000 food trade visitors attended the show, resulting in 606 promising contacts for U.S. exhibitors. Forty-nine U.S. companies and cooperators reported $24.8 million in 12-month sales. - $135 Million in Sales Projected at the Gulfood Show. The show took place in Dubai, United Arab Emirates, February 23–26, 2009. With 3,300 exhibitors from 76 countries, this trade-only event is the Middle East's largest hospitality-related food and equipment exhibition, drawing buyers from throughout the Middle East, Asia, Europe, and Africa. One-hundred and one U.S. companies reported $22 million in on-site sales and projected an additional $135 million in 12-month sales. - - - $18.5 Million in Sales Projected at ANTAD. Mexico's largest food and retail show took place in Guadalajara, Mexico, March 10-13, 2009. Over 15,000 trade visitors attended. Forty-two U.S. companies and cooperators participated in the U.S. Pavilion with a wide range of products, reporting $20,000 in on-site sales and projecting an additional $18.5 million in 12-month sales. - World Food Moscow (WFM) 2009 Generated Over $12 Million in Sales for U.S. Companies. WFM, one of the largest food forums in Russia, took place in Moscow, September 15-18, 2009. This show attracts approximately 50,000 trade visitors and it remains the main event for food exporters intending to start or develop sales to Russia. Thirty companies participated in the U.S. Pavilion. Pavilion exhibitors reported $334,000 in on-site sales, and $12.7 million in 12-month projected sales. U.S. SHOWS WITH INTERNATIONAL COMPONENT FAS staff have been active in facilitating buyer team visits at 12 U.S. shows with substantial international participation. Three of those key U.S. shows, (National Restaurant Association, Americas Food and Beverage Show, and the Institute of Food Technology), resulted in 23 buyer teams, with 490 participants from various regions and $7.9 million in projected sales of U.S. products. tº ºf FAS’ Study of Company Participation in USDA Endorsed Trade Shows. FAS conducted an internal study for reporting the participation of small and minority companies in various USDA-endorsed trade shows around the world. This report analyzed data compiled from evaluations received from 27 USDA endorsed trade shows taking place in 2008. Over 930 companies participated in these shows, with 50 percent of the responding companies meeting small company status and 46 percent responding as ethnic ownership, Statistics show that the most active minority ethnic group participants are Asian making up about 5 percent of the total companies reported. - - Small Florida Company Thanks FAS for New Sales. "FAS has saved us a lot of money, a lot of time, and a lot of effort, and prevented us from having to waste our time doing something that would not be beneficial to us in the end," said Mohamed Bouras, president of Bouras Global Trading. The company attributes much of its growth–a doubling of total sales since it began working with FAS–to its involvement in international trade shows and incorporating the information found on the FAS Web site into its business plan. U.S. Exports of White Oak Wood to Argentina. As a result of the FAS Custom Matchmaking Service, and with assistance from the Kentucky Department of Agriculture, an Argentine importer recently made a $30,000 purchase of U.S. white oak wood. Since 2004, FAS via the Custom Matchmaking Service, has assisted the Argentine firm in importing over $185,000 of U.S. wood and wood products, - 842 31-gl() COUNTRY STRATEGY SUPPORT FUND FAS Headquarters works closely with FAS Posts to link Country Strategy Support Fund (CSSF) use to FAS and USDA goals and country strategies. The fund supports market promotion and other FAS strategic priorities, including market access. Project examples include: - FAS Nigeria Scratches out $350,000 in Chicken Feed. FAS Nigeria recruited 30 leading poultry operators and grain importers to participate in the International Poultry Exposition and the International Feed Exposition (IPE/IFE) held in Atlanta, Georgia, January 28-30, 2009. The mission was designed to take advantage of the Government of Nigeria's repeal of a corn and sorghum import ban after 20 years. The mission participants have already imported more than $350,000 worth of U.S. poultry input products. In addition, eight selected industry leaders participated in a trade-servicing program in Washington D.C., hosted by the U.S. Grains Council (USGC), immediately following the IPE, Participants in the USGC activity are currently working as a group to import a shipload of U.S. corn. The CSSF program gave $4,310 for a locally employed staff member to accompany the mission participants and provide translation services. -- Korean Seafood Show Catches Some Big Sales. FAS and SUSTA collaborated to bring U.S. Seafood to Korean buyers at the Busan International Seafood & Fishery Expo, held November 13-15, 2008 in Busan, Korea. The U.S. exhibitors estimated they would sell $2.2 million worth of fish and seafood over the 12 months following the show. FAS spent a total of $7,510 in CSSF to pay for an FAS booth and a contact dinner, bringing 35 Korean importers and the U.S. exhibitors together. CSSF also funded travel for FAS staff to help work the show. - - Caribbean Basin Buyers Mission Orders up Sales at the National Restaurant Association Show. The Caribbean Basin Agricultural Trade Office (CBATO) sponsored a buyer's mission to the 2009 National Restaurant Association Show on May 15-19 in Chicago, Illinois. The State Regional Trade Groups (SRTGs) paid for the travel of three of the participants, the other 15 participants paid their own way. The Caribbean buyers reported planned purchases of $2.3 million over the next year because of show contacts. CBATO utilized $1,700 from its CSSF budget to fund staff travel to this event, representing a potential return of approximately $1,373 for every dollar invested in this market development activity. -- Philippine Inspection Mission Renders Success. From August 30 through September 10, 2009, FAS, APHIS, Food and Drug Administration (FDA), and the National Renderers Association (NRA), worked together to take a group of high-level Philippine government officials and feed industry representatives to the United States to audit and inspect rendering facilities and meet with U.S. government officials. NRA paid for the travel of the Philippine government officials and CSSF paid $5,400 for the travel expenses of an FAS Manila staff member to accompany the group. The visit is expected to result in market access for U.S. ruminant and bone meal, which has been banned in the Philippines since 2000 due to BSE concerns. The market potential for U.S. exports to the Philippines is expected to be worth $20 to $30 million. -- SIAL. China Has Largest USA Pavilion Ever. In May 2009, FAS organized the largest USA Pavilion ever at SIAL China. There were 41 U.S. exhibitors participating in the pavilion. SUSTA and the Food Export Association of the Midwest USA had multi-company stands. Other participating cooperators included the California Prune Board, Georgia Pecan Growers Association, Minnesota Turkey Council, Popcorn Board, Texas Pecan Crowers Association, USA Poultry & Egg and Export Council, and Wild Blueberry Association of North America. Thirty percent of the U.S. exhibitors were new to the market. The National Association of State Departments of Agriculture provided $17,971, EMP provided $4,676, and CSSF contributed $360, making it possible to offer exhibitors better facilities and conveniences at the pavilion, providing it with a business lounge, internet service, and attractive decoration of the overall USA Pavilion. The exhibitors reported $2.5 million in on-site sales and projected sales of $17 million over the next 12 months. comMoDrty CREDIT corporation (CCC) ExpoRT CREDIT GUARANTEE PROGRAMs The primary objective of the CCC export credit guarantee programs is to increase sales of U.S. agricultural commodities to international markets by facilitating the extension of export credits to countries that do not have access to adequate commercial credit. These CCC programs encourage U.S. lenders and exporters to extend credit 843 31-gll terms on sales of agricultural commodities and products to overseas customers. The CCC credit guarantee programs Support the involvement of foreign private sector banks and private sector importers in commercial trade transactions with the United States. The GSM-102 program provides guarantees for export sales with repayment terms up to three years. The FY 2009 GSM-102 program provided credit guarantees, which facilitated sales of about $5.3 billion, up significantly from $3.2 billion in 2008. Africa and the Middle East and Southeast Balkans reflected GSM-102 export sales for the first time in several years. Increased sales and/or additions of U.S. agricultural commodities were exported to seven countries and eight regions. While most sales were bulk commodities, new products such as tree nuts and distilled dry grains to Korea emerged, and a variety of wood products were shipped to Turkey. + GSM-102 EXPORT CREDIT SALES REGISTRATIONS Summary of FY 2009 Country/Region $ Millions Africa and Middle East $207.5 Caribbean 337.5 Central America . 607.2 China/Hong Kong 348.2 Eurasia 262.8 Jamaica 9.4 Korea 1,290.6 Mexico 289.1 Russia 368. I South America - 590.3 Southeast Asia 522.8 Southeast Balkans 10.5 Turkey 478.6 TOTAL $5,322.6 FACILITY GUARANTEE PROGRAM (FGP) On August 6, 2009, USDA published an advanced notice of proposed rulemaking soliciting comments on options to reform the FGP. The comment period closed on October 5, 2009, The major change to the statute, enacted in the 2008 Farm Bill, is to allow a waiver of U.S. content on capital goods if the Secretary determines that use of U.S. goods is not practical. FAS will develop and implement a revised program regulation in FY 2010, PROGRAM MANAGEMENT During FY 2009, FAS proactively managed GSM-102 program risks and costs. The 2008 Farm Bill requires GSM- 102 to be budget neutral over a 10-year period. To help meet this goal, FAS analyzed historical program defaults and recoveries to predict net default rates, and applied actuarial data to the subsidy cash flow model. This approach culminated in OMB's acceptance of the revised GSM-102 default and recovery assumptions that determine subsidy levels. Average program subsidy dropped from 0.87 percent in FY 2009 to -1.21 percent in FY 2010, indicating revenues will exceed program costs. FY 2011 subsidy is projected to be slightly higher but still negative at 0.87 percent. On the revenue side, FAS developed a revised draft program fee schedule that is more commensurate with program risk. This fee schedule was published in the Federal Register on September 21, 2009, for public comment. The comment period closed on October 21, 2009, FAS will consider comments received, adjust the draft fee schedule as needed, and implement a revised fee schedule in FY 2010. 844 31-gl2 MARKET EXPANSION PROGRAM In FY 2009, in response to poor domestic market conditions and the reintroduction of dairy export subsidies by the EU, FAS reactivated the Dairy Export Incentive Program (DEIP). DEIP helps U.S. dairy exporters meet prevailing world prices and encourages the development of international export markets in countries or regions where U.S. dairy products are not competitive due to subsidized dairy products from other countries. On May 22, 2009, USDA announced DEIP for the July 2008 through June 2009 year. On July 6, 2009 the initial tranche for the July 2009 through June 2010 year was announced. As of November 6, 2009, since the initial May announcement, USDA has awarded bonuses for 37,228 MT of nonfat dry milk, 17,470 MT of butterfat, and 1,843 MT of cheese. The program has facilitated sales of U.S. dairy products to Africa and the Middle East, Asia/Eurasia, Central and South America, and the Caribbean. - IMPORT AND THADE SUPPORT PROGRAMS – Improvements in Mexican Sugar Market Data. The quality and timeliness of publicly available data on the Mexican sugar market improved during FY 2009. Access to better data on the Mexican sugar market is important to USDA for managing the U.S. sugar supply-control program, since Mexico is the only country with open access to the U.S. sugar market. This achievement was due in large part to the work during FY 2009 of the government-to-government Mexico-U.S. Sweeteners Working Group (SWG) that was established in 2007 to improve and exchange sugar market data, actively monitor trade in sugar and high fructose corn syrup (HFCS), and apprise the other government of policy and market developments. Beginning in June 2009, in large part due to the efforts of the SWG, which meets about four times a year, the Mexican government for the first time began to publish, on a public web site, a supply and demand balance sheet for the Mexican sugar market. Staff from FAS and the Office of the USTR co-chair the SWG for the United States, while staff of the Secretariats for Agriculture and the Economy (Economia) co-chair for Mexico. -- Import Safeguard Program. In May 2009, the annual Federal Register Notice on the WTO Agricultural Safeguard Trigger Levels was published. The notice lists the updated quantity trigger levels for over-quota imports of certain beef, dairy, sugar, and cotton products that may be subject to additional U.S. import duties ..under the safeguard provisions of the WTO Agreement on Agriculture. During FY 2009, consolidated databases for WTO and Dominican Republic-Central America-United States Free Trade Agreement (CAFTA- DR) agreements were completed, - The Trade Adjustment Assistance (TAA) for Farmers Program. The American Recovery and Reinvestment Act (ARRA) of 2009 reauthorized and modified the TAA for Farmers program. The TAA for Farmers program helps producers of raw agricultural commodities and fishermen adjust to a changing economic environment associated with import competition through technical assistance and cash benefits. Producers of a commodity who have recently suffered a greater than 15 percent decrease in the national average price, the quantity of production, value of production, or cash receipts compared to the average of the 3 preceding marketing years, and imports contributed importantly to this decline, may be eligible to receive free information, technical assistance, and cash payments to develop and implement business adjustment plans from the TAA for Farmers program. A total of $202.5 million has been authorized for the program, with $90 million per year for the 2009 and 2010 fiscal years, and $22.5 million for October through December 2011. These funds will be used for developing and implementing approved Extension training programs, as determined by the National Institute for Food and Agriculture (NIFA), for cash payments to producers for development and implementation of business plans, and for USDA administration of the program. Eligible producers who develop an approved business plan, with guidance from educators working under approved Extension programs, are entitled to receive a cash payment of up to $4,000 to implement the initial business plan or develop a long-term business plan. Producers who subsequently develop approved longer-term business plans are entitled to receive an additional cash payment of up to $8,000 to implement their long-term plans. An interim rule for the TAA for Farmers program is expected to be published in FY 2010. 845 31-gl3 NEW TECHNOLOGIES U.S farmers are taking full advantage of biotechnology and other new technologies to increase their productivity, and they are expanding production of organic products in response to growing consumer demand. Commercialization of U.S. products from cloned animal progeny, genetically engineered animals, and nanotechnology is increasing significantly. However, trade in these products has been slowed by other countries’ failure to provide timely approvals for new technologies and standards for organics. Unchecked, this situation will worsen as more and more biotech crop varieties and other new technologies are adopted by U.S. agriculture. In 2009, approximately 85 percent of the corn, 55 percent of the cotton, and 91 percent of the soybeans planted in the United States were biotech varieties. Exports of these crops and other foods produced or processed using modern biotechnologies are ubiquitous and form the core of U.S. agricultural exports. FAS Defends Domestic Policies of U.S. Bioenergy Programs. U.S. legislation calls for the production and use of 36 billion gallons of biofuel in the transport sector by 2022. Meeting this mandate requires a 4-fold increase over 2008 levels. Internationally there is concern over the environmental and social sustainability of such an ambitious program as well as the impact on global food prices. As a result, there are numerous international efforts to develop both criteria and indicators for assessing sustainable bioenergy production as well as the development of international standards aimed at certifying sustainable bioenergy. FAS is actively participating in several international organizations, most notably Global Bioenergy Partnership (GBEP) and International Organization for Standardization (ISO), and is strongly advocating for U.S. interests while defending USG bioenergy policies as an important factor in meeting climate and energy security objectives. Notable achievements in the area of New Technologies in FY 2009 include: - Japan’s Biotech Risk Management Protocol Significantly Reduces Costs to U.S. Soy and Corn Exporters. Japan prohibits the import of biotech-derived products that have not undergone a food safety, feed, and environmental review. Following extensive FAS engagement over several years, in FY 2009, Japan introduced a new risk management plan to address the low-level presence of unapproved biotech feeds. Consequently, testing requirements for StarLink biotech feed corn exports were eliminated and testing requirements for other products reduced. The U.S. grain trade has saved an estimated $36 million dollars as a result. Japan annually imports 16 million MT of corn and 4.2 million MT of soybeans, valued at over $4 billion in FY 2009. - FAS Prevents Adoption of International Standards that Would Negatively Impact Biotechnology. Working with other USG agencies, FAS efforts in several standard setting bodies have prevented the adoption of standards that would have negatively affected trade in products derived from biotechnology. For example, in the Codex Committee on Food Labeling, a decision on the mandatory labeling of biotech foods was again deferred. The Leonardo Academy, a private standards-setting body, agreed not to exclude biotechnology from its standards for sustainability, Similarly, the United Nations Commission for Sustainable Development adopted text that did not contain statements that biotechnology is not sustainable. Finally, at the International Organization for Standardization (ISO) Technical Committee 34 on Food Products, FAS efforts resulted in the elimination of references to genetically modified organism detection testing and traceability standards from its business plan, and from the biomolecular markers sub-committee of ISO TC 34 scope and mission statements. -- EU Approves Biotech Round-Up Ready 2 Yield Soybeans. Ongoing discussions led by FAS for USDA facilitated EU approval of second-generation Roundup Ready (RR2), also known as “Roundup Ready 2 Yield,” genetically engineered soybeans for import and processing for food and feed uses. RR2 soybeans were commercialized in the United States in 2009. Prior to this, only one biotech soybean variety was commercially cultivated in the United States, and approved for import and processing for food and feed uses in the EU, U.S. soybean exports to the EU were valued at $737 million in FY 2009, and are crucial for the EU's livestock and feed manufacturing industries. - - FAS Facilitates Support for Biotechnology in Mexico. Ongoing discussions and technical assistance led by FAS under the auspices of the North American Biotechnology Initiative (NABI) have helped develop support for biotechnology in Mexico and had a positive effect on U.S. agricultural exports. NABI serves as a forum for the United States, Canada, and Mexico to exchange ideas and information on the regulation and trade of biotech products. These discussions facilitated Mexico’s recent approval of field trials for biotech corn. They also 846 31-gi 4 reduced the trade impact following the inadvertent shipment in late 2008 of a small quantity of unauthorized biotech cottonseed to Mexico from a cotton field trial in Texas. Furthermore, in recent trilateral discussions, Mexican officials expressed interest in working with the United States and Canada to foster the development of a domestic biotechnology industry, FY 2009 U.S. exports of corn, soybeans, and cotton to Mexico were valued at $4.3 billion, most of which were biotech varieties. - FAS Prevents EU Cloning Regulations that Threaten U.S. Livestock and Livestock Product Exports. In concert with other USG agencies, FAS forestalled the EU’s adoption of restrictive measures on cloning that could have affected U.S. exports of livestock and livestock products. Since September 2008, the European Parliament has called for an EU ban on all livestock products derived from animal clones, or the offspring of clones. Despite Parliament’s efforts, multiple interventions by the USG and industry at various levels in the European Commission have succeeded in keeping the internal discussion open and forestalled a ban. Both the United States and the EU have animal clones. While the U.S. industry maintains a moratorium on introducing products from clones into food channels, the presence and use of the offspring of clones is not tracked globally. Therefore, all livestock products imported by the EU potentially could be affected by a ban. In FY 2009, U.S. exports of dairy products, red meat and live animals to the EU were valued at $421 million. - FAS Preempts Trade Disruption by Securing Korean Approval of Biotech Corn and Soybeans. A series of technical discussions undertaken by FAS with Korean officials facilitated Korean approval of several new biotech corn and soybean varieties recently commercialized in the United States. Korea approved the new soybean variety, “Roundup Ready 2 Yield” genetically engineered soybean (RR2) (MON89788) on March 4, 2009. The two corn varieties, MON89034 and A2704-12 were approved April 2. These timely approvals averted the disruption of U.S. corn and soybean exports to Korea, valued at almost $1.3 billion in FY 2009. -- U.S. Organic Equivalency Agreements with Taiwan and Canada. During FY 2009, the sustained efforts of FAS culminated in organic equivalence determinations with Taiwan and Canada that maintain or grow the flow of U.S. organic trade. In March 2009, Taiwan recognized the U.S. organic system as equivalent to the Taiwanese organic regulations following active engagement by FAS and the Agricultural Marketing Service’s National Organic Program (NOP). Recognition of NOP in Taiwan has kept the Taiwanese market open to an estimated $50 million in annual U.S. organic exports. Similarly, in 2007, FAS began engaging Canadian officials as they began development of organic standards, with the aim of reaching an equivalence agreement. FAS performed technical analysis of the differences in the regulations of both countries, and initiated negotiations in coordination with the USTR’s office and NOP. After 18 months of negotiations, the United States and Canada signed a determination of equivalence on June 17, 2009, Canada is by far the largest export market for U.S. organic products, with exports estimated at $1.4 billion annually. FOOD SECURITY Global food insecurity impacts people worldwide; with over 1 billion hungry, the problem is exacerbated by the current global economic downturn. Food assistance alone is not enough — availability is also about trade and in- country production increases. The biggest contributing factors to insufficient in-country production are chronic under-investment in agriculture, inefficient inputs and markets, and poor governance. To address food insecurity, states must improve the entire value chain from farm to table, increasing production and efficient inputs, reducing post-harvest losses, adding value, and supporting mechanisms that encourage local, regional, and international trade. Food security must be country-driven and focused at the local and community levels. - MARKET INTELLIGENCE Market intelligence is an essential and core component to the work conducted in FAS that ultimately results in policy, market, and food aid decisions. In FY 2009, FAS continued to provide primary analytical input to USDA’s global supply and utilization estimates for major agricultural commodities. Using attaché reports, market intelligence, satellite imagery, and other information FAS provided monthly global market intelligence and analysis used for USDA program operations and regulatory and policy-making activities. FAS analysis also supported international agricultural trade policy and market access activities, negotiations, and export programs. As a result, USDA policy makers and the U.S. agricultural industry received timely, unbiased, and reliable information that allowed them to make important policy and strategic decisions, - 847 31-gl3 - Assessing Domestic and Global Production. FAS provided objective, timely, and reliable information on the global food supply and crop conditions, as it was critical to the United States and global agriculture as well as the implementation of various Commodity Credit Corporation (CCC) programs. Such intelligence sealed critical information gaps in high risk and disaster affected regions around the world. FAS overseas analysts and Satellite imagery products provided continuous validation of global commodity supply changes that were critical for targeting and right-sizing food aid needs in support of CCC food aid programs such as the Food for Peace and Food for Progress (FFP) programs and evaluating implementation of the Export Credit Guarantee Program. One example was FAS’ ability to provide early warning of both drought devastation of winter grains in Iraq and a record wheat harvest in Afghanistan well before harvest via the crop monitoring program. These early assessments allowed government agencies, private sector non-governmental organizations and food aid agencies to accurately adjust or tailor program activities and react to changing circumstances. The U.S. government was able to assure the Iraqi government of their continued need for larger than normal grain imports, while the Afghan government could rebuild emergency grain reserves and reduce food aid disbursements and imports. - - CoCHRAN FELLOWSHIP PROGRAM The Cochran Fellowship Program (CFP) provided short-term training in the United States for 395 international participants from 73 countries in FY 2009. Since its inception in 1984, the program has provided training to more than 13,500 participants from 121 countries. Cochran participants meet with U.S. agribusinesses, attend policy and food safety seminars, and receive technical training related to short and long-term market development and trade capacity building. The following are examples of CFP benefits reported in FY 2009: Bangladesh: The CFP staff worked jointly with the American Soybean Association to sponsor fish-feed industry personnel to attend a comprehensive short course at Texas A&M University on the production and quality control of extruded fish feed. After completing the course, Mr. Habibur Rahman, Manager of Aftab Bahumukhi Farm Ltd., started building the Aftab Aqua FeedMill. In late November 2008, the newly built feed mill commenced production of extruded floating feed for Tilapia farming. Mr. Rahman said that the course in Texas helped him to finalize establishment of his new feed mill and he has now released modern, floating fish feed into the local market. It is expected that other participants of the short course would start using modern technologies obtained from Texas A&M University in their feed processing plants by the end of 2009. China: The CFP introduced the U.S. pet food and animal feed industry to Animal Feed Registration Office officials from China’s Ministry of Agriculture. Feed registration has been a significant hurdle for U.S. exports of animal feed, especially pet food, for a number of years because of a lack of knowledge in China about the highly developed U.S. industry. Following a trip to several locations in the United States, the team reported there was a significant increase in their knowledge and comfort level with U.S. products exported to China. From the U.S. perspective, industry officials stated that their interaction with the Chinese officials was valuable in understanding China's concerns and proving that the United States produces a safe, sustainable product. The Pet Food Institute played a vital role in co-sponsoring and organizing this program. * - - China: This CFP was designed to increase China's knowledge of the U.S. plant variety protection (PVP) system and to demonstrate how the U.S. seed industry relies on two key aspects of our PVP system that are lacking or weak in China. The first aspect is accession to the standards of the 1991 International Union for the Protection of New Varieties of Plants (China is currently using an oider version of the agreement). The second is providing a PVP registration system that is faster, uses more industry-supplied data, and is more robust in enforcement. U.S. industry believes that the Chinese market could be much more significant if it were following rules similar to those of the United States. The American Seed Trade Institute provided important assistance in hosting and organizing the visit. Indonesia: CFP provided training in U.S. Halal certification practices to Indonesia in FY 2009. Halal is an Arabic word meaning “permissible under Islamic law.” As the most populous Muslim- majority country, Indonesia requires Halal certificates for all imported animal-based food products except pork. The Halal certificates are issued by the Islamic Centers (the Halal Certifier Bodies) in the United States that have been acknowledged by the Indonesian Council of Ulama (MUI), which plays a key role in certifying to the authenticity of Halal standards for food products. The CFP served as an important tool for resolving market access issues related to U.S. meat exports to Indonesia by helping to enhance the U.S. relationship with MUI and increasing the number of U.S. Islamic 848 31-gló centers approved by Indonesia. The Cochran Fellows developed heightened awareness of the U.S. food safety system, food processing practices, and Halal certifying measures. Following the training, MUI updated the list of approved U.S. Halal Certifier Bodies from one to five cattle slaughtering plants, an important outcome. The updated list of approved certifiers went into effect in October 2009. - ... • - Philippines: From 2002–2008, Officers of the Philippine Bureau of Animal Industry (BAI) and the National Meat Inspection Service gained knowledge about the U.S. food safety system and animal quarantine, inspection and clearance program in a CFP. This has helped them quickly resolve various trade issues and gain confidence in the U.S. regulatory system. Successes include an immediate lifting of the temporary ban on U.S. pork products and live swine after the H1N1 detection in 2009; and immediate action by BAI on Bureau of Customs questions about dates of USDA Food Safety and Inspection Service certificates and accreditation of U.S. meat and poultry plants. The CFP training has helped FAS Post develop a strong relationship with Philippine meat and poultry regulatory agencies and has been instrumental in increasing U.S. meat and poultry exports to the Philippines. U.S. meat and poultry exports to the Philippines more than tripled over the last five years, from $30.67 million in 2003 to $106.85 million in 2008. FAS hopes for similar success with CFP fellowships for Philippine plant-quarantine officers. Kenya: Lawrence Njuguna from Kenya attended 2-week training in dairy herd management, nutrition, and milk processing at the University of Minnesota through the CFP in 2003. Presently in 2009, Mr. Njuguna is passing along the skills learned during his CFP training to hundreds of Kenyan dairy farmers by conducting on-farm trainings and sharing his knowledge on a daily radio talk show on farming, Mr. Njuguna has also improved animal nutrition and genetics that have led to doubling his herd's milk production and has introduced marketing strategies that yielded improved prices for milk and heifer sales. Costa Rica: The International Center of Food Technology (CITA) at the University of Costa Rica participated in a CFP which provided training on Hazard Analysis and Critical Control Point (HACCP) Plan Validation and Verification. CITA provides training and education on HACCP, as well as technical assistance for the implementation of HACCP Programs. The CFP training program, which was given in conjunction with Texas A&M University, strengthened CITA’s training practices, and over 20 industries have now been trained in HACCP validation. - Colombia: The CFP conducted a Biotechnology Regulatory Program to assist Colombia in enhancing its understanding of science-based information regarding biotechnology- engineered products, as well as to increase sales opportunities for U.S. biotech engineered foods and products. After completing the program, Adriana Castaño-Hernández, the Deputy Director of the Foods Division at the National Institute for Food and Drug Surveillance noted that, while the biotechnology regulations for Colombia and the United States were similar, the training helped Colombia to update its labeling requirements to be consistent with U.S. standards. Jamaica: The CFP conducted a training program for Jamaica to increase understanding of pesticide-residue-level testing procedures and related U.S. regulations. Jamaica had been evaluating its pesticide regulations on imported and exported fruits and vegetables, and a common understanding of pesticide regulations and procedures was important in enhancing two-way trade between the United States and Jamaica. After the training, the Jamaican deiegation participated in the April 2009 Codex Committee on Pesticide Residues (CCPR) meeting in Beijing, China, where Jamaica was an active and vocal supporter of U.S. initiatives. This constituted a shift in its position from previous CCPR meetings. Furthermore, it contrasted the opposition made by the EU against the U.S. initiatives for increased maximum-residue-limits or MRL harmonization. The CFP training program on Pesticide Residue Levels directly contributed to Jamaica's support for U.S. policies, St. Kitts: The CFP, in conjunction with the University of Puerto Rico Mayaguez and USDA’s Food Safety and Inspection Service, conducted a Meat and Poultry Inspection program in the summer of 2008. The Chief Veterinary Officer for St. Kitts attended the training to gain an understanding of the U.S. system for controlling risks in meat and poultry products. His attendance was a shared effort between the CFP and the FAS Caribbean Basin Agricultural Trade Office (CBATO) in Miami. On June 14, 2009, the Government of St. Kitts granted complete market access for U.S. beef and beef products from cattle of all ages. The CFP training program played a critical role in persuading the St. Kitts government to expand market access. St. Kitts had previously allowed only boneless meat from animals less than 30 months of age, and U.S. beef and beef product exports to St Kitts totaled $550,000 849 31-gi 7 in 2008. With this agreement, St. Kitts has signaled a determination to follow international standards, and U.S. beef . exports are expected to increase substantially. f Ukraine: The CFP conducted a Biofuels Program in February 2009 to assist Ukraine in understanding U.S. biodiesel and ethanol regulations, production and marketing. After completing the program, the Deputy Head of the Secretariat of Parliamentary Committee on Energy Policy, Ukrainian Rada (Parliament), noted that the training helped Ukraine update their renewable energy requirements to be consistent with U.S. standards. On April 1, 2009, the Ukrainian Parliament adopted the Law "An Amendment of the Law of Ukraine 'On Electrical Energy’ Regarding Stimulation of Usage of Alternative Sources of Energy" No. 1220-VI (the Green Tariff Law), which went into effect on April 22, 2009. - FY 2009 Participants by Region and Funding Source Freedom Iraq/Afghanistan Emerging Support Technicai Markets Appropriation Act USAID Assistance" Program || Total Asia 77 0 0 0 0 || 77 Eastern Europe and - - . - Eurasia 50 84 0 0 {} 134 Eatin America and the Caribbean 70 0 {} {} {} 70 Africa and the Middle East 97 0 9 . 8 0. 114 Program Total 2.94 84 9 - 8 {} 395 *Additional funding obtained from FAS appropriations. BORLAUG FELLOWS PROGRAM (BFP) In its fifth year, the Norman E. Borlaug International Agricultural Science and Technology Fellows Program (BFP) continued to expand, training some 358 Fellows from 49 countries since the program’s inception in 2004 and more than 89 Fellows in FY 2009. The authorization for the BFP under the Food, Conservation and Energy Act of 2008 institutionalizes this successful trade and scientific capacity-building program. The BFP offers fellowships for scientific training and study in the United States to individuals from eligible countries. The program helps developing countries strengthen agricultural practices through the transfer of new science and agricultural technologies, including those related to production, processing, marketing. The program also addresses obstacles to the adoption of technology, such as ineffectual policies and regulations. The BFP continues to strive for diversity, with females comprising nearly 50 percent of participants. Accomplishments in FY 2009 include the following: -- Borlaug Organic Certification Program. During 2008, the first Borlaug Organic Certification Program was successfully initiated in support of requests from African Growth and Opportunity Act (AGOA) leaders. Five African scientists and researchers from Benin, Burkina Faso, Nigeria, and Niger received organic certification and regulatory training. In collaboration with scientists at Colorado State University and Washington State University, the Borlaug fellows focused their research collaboration and received hands-on training in organic production, marketing and farming systems as well as U.S. certification guidelines and regulations. Of the five trained, the representative from Nigeria successfully met aH requirements to officially certify organic products to U.S. standards. The training has helped address barriers to bilateral trade by fostering the adoption of U.S. regulatory standards and providing U.S. agribusinesses with access to high-quality organic, raw materials for value-added U.S. exports. -- Indonesia. The ongoing partnership of FAS and the World Cocoa Foundation continues to pay dividends to beneficiary countries and the U.S. confectionary industry. This public-private partnership builds the capacity of local scientists on techniques to improve plant-health issues affecting the cocoa crop such as integrated pest management (IPM) and post harvest technologies. An Indonesian Borlaug fellow collaborated with scientists at USDA’s Agricultural Research Service (ARS) in 2009 to correctly identify Thanatephorus theobromae, the fungus responsible for vascular streak dieback (VSD). VSD has devastated cocoa crops in Indonesia killing 75 850 31-gl3 percent of the cocoa crop infected, and work is underway with collaborators at ARS to develop media to facilitate growth of the fungus to allow sequencing of the genome and in-vitro growth assays to assess potential IPM for VSD. This collaboration has led to a greater understanding of VSD and will set the stage for an IPM strategy for cocoa in Indonesia. Adoption of IPM techniques within the cocoa sector will improve the quality and safety of Indonesian cocoa while ensuring a reliable source of inputs for U.S. processors. Malawi and Mozambique. In 2008, two female Borlaug fellows from Malawi and Mozambique received training in goat production and genetic improvements at Texas A&M and Prairie View Universities. Agricultural extension agents with animal expertise, the Borlaug fellows learned artificial insemination (AI) techniques for goats that will help African farmers improve native goat breeds for milk and meat traits. The Fellows returned to their respective countries armed with new skills and practical AI kits for in-field use. Within a year, the African families and female goat owners, with whom the Borlaug fellows worked, found their young goats providing more milk and/or meat. Goat production is entirely conducted by women and children in Africa, and family goat herds often provide the only food products for consumption or income for families. It is estimated that the two Borlaug fellows were able to employ AI and assist with improving the goat genetics of 50 families in Malawi and Mozambique. Sub-Saharan Africa. Under the USDA BFP, 35 African scientists and researchers from 35 Sub-Saharan African countries received training at 12 American land grant institutions in FY 2008. In FY 2009, the Borlaug Program used seven land grant institutions, including two minority-serving land grant institutions to train 19 Fellows, including the first Borlaug Fellow from Liberia. This training has helped address barriers to bilateral trade, provided U.S. agribusinesses access to scarce inputs and new consumer markets, and will improve food production and trade opportunities for U.S. exporters. Survey of Borlaug Fellows. The BFP launched an online survey in September 2009 to gather information from Borlaug alumni about the impact of the fellowship program on their work. By mid-November 2009, 100 surveys had been completed by former BFP participants from around the world. The majority of Borlaug fellows surveyed stated that their fellowship had a positive impact on one or more aspects of their work, Additional survey results include the following: 92 percent of respondents reported that the Borlaug Program had a positive impact on their research, 74 percent reported the program had a high impact on their teaching, - 14 percent reported a high impact on their policy work, and 52 percent reported that their fellowship training led to the adoption of one or more new techniques or technologies in their home institutions. El Salvador. A Borlaug fellow from El Salvador has taken the initiative to produce a comprehensive integrated pest management (IPM) training manual in Spanish to use for training extension agents from the Centro Nacional de Tecnología Agropecuaria y Forestal (CENTA). As part of the Ministerio de Agriculturay Ganaderia (MAG), CENTA’s extension workers are a main source of information for the country’s farmers. The lack of standardized training manuals and educational literature has prevented successful communication between extension workers and farmers in El Salvador in the past. The Borlaug fellow has also developed an illustrative poster for farmers describing proper IPM procedures. In addition, he is drafting a training manual on Good Agricultural Practices and updating the Good Manufacturing Practices training manual for El Salvador. These achievements are particularly significant because MAG does not have the resources to create educational materials itself. - SCIENTIFIC COOPERATION EXCHANGE PROGRAM (SCEP) In 1978, USDA signed a cooperative agreement with the Ministry of Agriculture (MOA) of the People's Republic of China to exchange scientific teams and technical information in the fields of agriculture, forestry, and water and Soil conservation. Since its inception, the SCEP has facilitated the exchange of nearly 2000 U.S. and Chinese scientists. The exchange program is an effort to enhance overall relations between the two countries and create a positive atmosphere for trade. Several SCEP programs have directly supported the objective of developing trade with China. 851 31-g!9 - United States Helps China Improve Food Security with Remote Sensing Technology. USDA and faculty members from universities in Arizona and California educated Chinese policy makers, extension workers, and academia on the beneficial uses of remote sensing in agriculture. The program addressed techniques used to identify water deficiencies and surpluses, plant diseases, and herbicide damage, as well as the use of remote sensing in variable rate applications offertilizers and pesticides. Precision agriculture and improved remote sensing techniques will provide opportunities for Chinese policy makers and scientists to improve food security, and closely monitor and potentially mitigate the long-term effects of climate change. . - Chinese Farmers Trained on U.S. Distillers' Dried Grains. Grain experts and ethanol producers from Illinois trained livestock and aquaculture producers in China on the economic and nutritional benefits of using U.S, DDGS. The training will allow Chinese farmers to reduce livestock mortality rates—thereby improving food availability—and improve efficiency, while simultaneously generating a market for U.S. DDGS. scIENTIFIC coopFRATION RESEARCHPRogRAM (SCRP) The SCRP continues to collaborate with a diverse group of U.S. institutions to build long-lasting, international research partnerships, Projects link U.S. scientists with researchers worldwide and make practical use of biotechnology and other tools to help solve trade, food, and agricultural problems. Following are examples of USDA projects from this mutually beneficial, competitive grants program. - -- Biotechnology Improves Nutritive Qualities of Peanuts. Scientists from Alabama A&M University, a minority-serving institute, conducted joint research with academia from Senegal to improve the health and nutritional qualities of peanuts. The research resulted in an allergy-free peanut, which will provide economic gains for peanut producers in Senegal and the United States. - - - Research Collaboration Helps Subsistence Farmers in Guatemala. Scientists from the University of Florida and Rafael Landivar University conducted joint research to reduce pesticide usage on Guatemalan Snow peas. The research results helped improve basic pest management skills among field support staff and subsistence farmers in Guatemala. -- U.S. and Guatemalan Scientists Collaborate to Control Bacteria Wilt. Scientists from the University of Wisconsin and the University of San Carlos in Guatemala collaborated on strategies to control bacterial wilt that infects U.S. geraniums and Guatemalan tomatoes. The scientists worked cooperatively to begin breeding geranium and tomato cultivars that are bacterial wilt-resistant. FOREIGN FOOD ASSISTANCE PROGRAMS FAS administers several food assistance programs to help developing countries with humanitarian crises, economic development, and the transition from being food aid recipients to commercial markets. Programs administered by FAS consist of P.L. 480, Title I; Food for Progress (FFP); the McGovern-Dole International Food for Education and Child Nutrition Program (FFE); and the Local and Regional Procurement Pilot Project (LRP). Fiscal year 2009 activities focused on helping countries move toward graduation and the development of their agricultural economies. The programs featured a mix of monetization, direct distribution, and local food aid commodity procurement to meet the specific needs of recipient countries. - FAS programmed 415,000 tons of food assistance with an estimated value of about $406.2 million. Of this amount, estimated commodity costs represented $197.1 million and estimated transportation and other non-commodity costs were $209.1 million. FAS provided all of the food assistance through donations, with no concessional sales agreements in FY 2009. FAS also programmed $4.8 million of food assistance through local and regional commodity procurement under the pilot project, for a total food assistance value of $41.1 million. Twenty-nine countries received food assistance through FAS-administered programs. 852 31-g20 FAS FOOD ASSISTANCE PROGRAM SUMMARY, FY 2009 $ Millions 000 MT P.L. 480 Title I Funded/FFP $22.0 - 14.3 CCC Funded/FFP $215.8 274.2 McGovern Doie Food for Education $168.4 126.5 Local and Regional Procurement Pilot Projec $4.8 N/A TOTAL, Food Assistance - $411.0 415.0 In addition, FAS has improved its procurement operations for food assistance by avoiding the “bunching” of shipments just before the close of each fiscal year. This is accomplished through increased use of long-term, multi- year agreements with private voluntary organizations and the World Food Program (WFP), which permit shipments well in advance of the close of the fiscal year, and by extending procurement efforts (commodity and freight) traditionally scheduled for the end of the year into the following year. FAS also fully utilizes the services of the Farm Service Agency, including the single-step procurement of commodity and freight for packaged commodities. When possible, FAS further combines purchases of both packaged and bulk commodities with the purchases of the U.S. Agency for International Development, thus taking advantage of volume discounts afforded by greater quantities purchased and shipped. - P.L. 480 TITLE I PROGRAM Providing food assistance to targeted developing countries in order to promote economic growth is an objective of the concessional sales component of the Title I program. It promotes the recipient country's transition to commercial trade by gradually reducing the concessionality of the program and eliminating ocean freight financing. During FY 2009, no programming was done under the concessional sales component of the Title I program. Title I funds may also be used to support the FFP program, which is a grant program designed to assist countries. working to transition to more market-oriented economies. In FY 2009, Title-I funding provided over 14,300 MT valued at $8.9 million, and $13.1 million of transportation and other non-commodity costs, These programs were with the WFP. Funds used to support these programs were carried over from unobligated balances from prior years. FY 2009 P.L. 480 TITLE I FUNDED/FOOD FOR PROGRESS COUNTRY ALLOCATIONS ($ Millions) TOTAL COUNTRY VALUE Burundi - $10.0 Central African Republic 12.0 Subtotal - $22.0 COMMODITY 000 MT Corn - 3.5 Cornmeal 3.6 Corn Soy Blend - . 2.0 Peas/Lentils 3.2 Vegetable Oil - 2.0 Subtotal - 14.3 Below is an example of an FY 2009 Food for Progress program funded through P.L. 480 Title I: Burundi: Burundi has a high population density and very limited natural resources, and about 90 percent of Burundians depend on subsistence farming. The assassination of Burundi's first democratically elected president in October 1993 led to a decade of conflict. This resulted in 300,000 deaths and left 1.4 million internally displaced persons and refugees in neighboring countries, as well as 25,000 war orphans. Despite recent improvements in the 853 31-g21 olitical situation, long-term effects of the civil war and widespread food insecurity persist throughout the country, umanitarian assistance is still needed to address the needs of the most vulnerable, including returnees and refugees. ising food prices are also impacting vulnerable people in both rural and urban areas. USDA provided $10 million fTitle I funding through the FFP program to the WFP. The program is supporting the recovery process in six rovinces characterized by high levels of food insecurity and includes general food distribution and support for ulnerable groups, school feeding, asset creation, skills training, and nutrition programs. ECC-FUNDED FOOD FOR PROGRESS The FFP program assists developing countries in expanding private enterprise and making the transition to a market conomy, FFP agreements with countries may be funded with CCC or, as noted above, P.L. 480, Title I resources. n FY 2009, CCC funding provided over 267,000 MT valued at $117.2 million, and $98.6 million of transportation ind other non-commodity costs. USDA completed FFP programs with both private voluntary organizations (PVO) nd foreign governments. These implementing partners usually monetize (sell on the local market) the commodities d use the sales proceeds to fund development projects. The countries receiving CCC-funded FFP assistance and e quantity of the commodities programmed are shown in the tables below:. FY 2009 cCC-FUNDED FOOD FOR PROGRESS ($000) TOTAL COUNTRY VALUE Afghanistan $34.0 Armenia 0.2 Bangladesh 10.5 Bolivia - 1.2 Dominican Republic - 13.5 Ethiopia 13.8 Malawi - 35. i Mongolia 1.7 Mozambique 8.8 Niger 0.7 Pakistan - 44.0 Philippines 24.9 Senegal - 18.2 Uganda 9.2 Subtotal $215.8 COMMODITIES PROGRAMMED IN FY 2009 UNDER CCC-FUNDED FOOD FOR PROGRESS COMMODITY 000 MT Crude Vegetable Oil 1.2 Soybean Meal 48.4 Soybean Oil - 26.5 Vegetable Oil - 0.1 Wheat 198.0 Subtotal 274.2 FFP activities have included improving agricultural techniques and marketing systems, providing education to farmers, helping develop cooperatives, teaching irrigation and land conservation techniques, supporting agribusinesses and microcredit enterprises, and building the capacity to trade. Additional examples of success in FY 2009 under the FFP include the following: - - 854 31-g22 Afghanistan: The United States has made a long-term commitment to help Afghanistan rebuild after years of war. The Afghanistan Food Security Monitoring Bulletin of 2007 indicates that 37 percent of households cannot meet their nutritional needs. Shelter for Life International (SFL) is using proceeds from 25,000 MT of monetized wheat to implement programs that fight food insecurity. The total value of SFL's FFP agreement is $12.1 million, including commodity and ocean freight. SFL is rehabilitating irrigation systems, building storage facilities for commodity maintenance, facilitating information sharing and extending credit to local farmers. With training and technical support, agricultural productivity is increasing, local markets are becoming more accessible, and grain mills are improving. The objectives are to increase income for participating farmers by 15 percent in the first year, 75 percent in the second year, and 5-10 percent every subsequent year for 5 years. In addition, productivity should increase 100 percent, and conflict should decline by 50 percent over 3 years. In targeted communities, agricultural participation should increase by 50 percent, and the purchasing power of local families is projected to rise by 400 percent, USDA food assistance is helping build the foundation for economic and agricultural growth in war-torn Afghanistan. - Bangladesh: Although Bangladesh has made major strides to meet the food needs of its increasing population, it is among the poorest and most densely populated countries in the world. Fifty percent of the total population lives in poverty, 34 percent lives on less than $1 per day, and over 52 percent of children under 5 years of age face severe malnutrition. Cornell University is using the proceeds from 4,850 MT of monetized, crude, degummed soybean oil to implement programs that fight poverty in the region. The total Food for Progress grant value including commodities, ocean freight and other program costs for FY 2009 is $10.5 million. Cornell is providing training and micro-loans to small farmers to enhance agricultural production technology in liming, bedding and arsenic management. Cornell is also improving the capacity of national agricultural institutions, non-governmental organizations and input-supply dealers to provide technical support and infrastructure development to farmers. By the end of the program, it is projected that crop productivity will increase by 40 percent, food insecurity will decrease by 50 percent, and incomes for local farmers will increase by 25 percent. USDA food assistance is essential in fighting food insecurity, malnutrition and poverty in Bangladesh. Dominican Republic: Food insecurity and malnutrition are most widely seen in the underserved sugar cane farming communities (bateyes) in the Dominican Republic where access to farming and agricultural production is limited. The Batey Relief Alliance (BRA) is implementing programs designed to address the pressing needs of millions in the Dominican Republic, especially in the bateyes. BRA is monetizing 1,250 MT of crude, degummed vegetable oi and is using the proceeds to implement program activities that address the food needs of the Dominican Republic. BRA’s FY 2009 FFP grant is valued at $2 million, including commodities, ocean freight and other program costs. BRA is improving the region's agricultural productivity by training local farmers in agricultural management. Through a Food for Work program, enhanced technical and business training is provided by engaging local inhabitants in development projects. These program activities are projected to accomplish the following: increase agricultural production by 20 percent; decrease crop loss by 20–25 percent; grow income and food sales by 20 percent; raise beneficiary access to markets by 35 percent; and increase the number of people with access to potable and clean water by 50 percent. Ethiopia: Ethiopia is among the most underdeveloped countries in the world, ranking 171 out of 177 countries in the 2009 United Nations Human Development Index. Undernutrition is rampant, affecting an estimated 50 percent of the population. The World Council of Credit Unions (WOCCU) is using proceeds from 23,000 MT of monetized hard red winter wheat to implement programs that address food insecurity in the region. The total grant value from Food for Progress for WOCCU for FY 2009 is $13.8 million, including commodities, ocean freight and other program costs. WOCCU is developing a basic commercial environment for agriculture by providing technical assistance on productivity, post-harvest handling and marketing strategies to the farmer members of rural credit unions. Infrastructure such as storage facilities, irrigation systems, access roads, bridges, basic sanitation facilities and other support projects are improving through the support of community self-help activities. Finally, WOCCU is strengthening community-based agricultural credit unions in order to expand credit and micro-loans to local farmers. These activities will increase output, yields, and income for local farmers by 30 percent. USDA food assistance in Ethiopia is providing a means to attain sustainable economic and agricultural growth. Malawi. Malawi faces serious economic and agricultural problems that necessitate immediate assistance. According to the International Monetary Fund, over half of the 13.6 million inhabitants live in poverty. Dependence on rain-fed agriculture, exposure to high regional transport costs, extended dry spells, and the inability to prevent 855 31-g23 oil erosion causes 30-50 percent of the population to be at risk of food insecurity. FINCA International is onetizing 10,000 MT of hard red spring wheat and using the proceeds to implement programs to reduce food insecurity. The FFP grant for FY 2009 equaled $8.5 million. FINCA is expanding microfinance services to gribusiness entrepreneurs in rural areas as well as conducting social and economic assessments to determine the influence of loans on household welfare and agriculture related businesses. Moreover, training and support is elping local farmers to promote long-term sustainable agricultural growth. These activities are projected to increase individual business sales and income for loan recipients by 10 percent annually. Agricultural productivity and food security should increase by 15 percent as access to tools, equipment, inputs, marketing opportunities, and financial points of service for rural clients increase. USDA food assistance in Malawi is paving the way for Sustainable economic and agricultural development. - Pakistan: Since 2001, Pakistan has seen a surge of foreign direct investment (FDI) and has experienced relatively high macro-economic growth; however, this has done little to thwart poverty and food insecurity, since low levels of spending in social services and a high population growth rate persist. Pakistan’s extreme poverty and underdevelopment are key concerns, especially in rural areas. The Government of Pakistan (GOP) is using 50,000 MT of wheat and 6,800 MT of soybean oil to assist internally displaced persons. The GOP's FY 2009 FFP grant is valued at $20 million. - Philippines: Economic growth and a decreasing national average of poverty in the Philippines masks the unfortunate realities that exist in the Mindanao provinces where poor agricultural practices, natural disasters, and conflict are a constant burden. In response, Catholic Relief Services (CRS) monetized 9,000 MT of soybean meal and will use the proceeds to implement several activities focused on alleviating these pressures. CRS' FY 2009 Food for Progress grant is valued at $5.7 million, including commodities, ocean freight and other program costs. CRS will implement the Expanded Small Farms and Marketing Program (E-SFMP) to increase food production and reduce poverty. The program will focus on enhancing technical support to farmers, increasing post-harvest capacity, and improving post-harvest practices. CRS' agreement will build upon the successes of CRS/Philippines' ongoing USDA-assisted Small Farms and Marketing Program (SFMP), which has been implemented in five pilot sites throughout Mindanao. CRS activities in the Mindanao provinces are projected to increase farm income of resource- poor farmers by an average of 50 percent, provide agricultural extension and marketing services for 10,000 farmers, and increase crop production. Senegal: The higher cost of imported rice is straining many households in a region where poverty and undernutrition rates are already high. The National Cooperative Business Association (NCBA) is using proceeds from 4,200 MT of monetized, crude, degummed soybean oil to implement programs that focus on millet production, an important staple crop to Senegal. The FFP grant to NCBA for FY 2009 equaled $8.3 million. NCBA is teaching financial management, efficient production and processing methods, marketing strategies and business development to targeted inhabitants. NCBA is distributing improved seeds, promoting conservation farming and establishing information systems along with guarantee funds. These activities are strengthening producer organizations, enhancing millet production, improving market linkages and increasing access to financial services. Over the three- year program, yields are projected to grow by 75 percent and profits to increase by 150 percent. USDA food assistance in Senegal is enhancing cultivation methods, access to markets and financial institutions, and management practices in order to fight poverty and food insecurity. MCGOVERN-DOLE INTERNATIONAL FOOD FOR EDUCATION AND CHILD NUTRITION PROGRAM The McGovern-Dole International Food for Education and Child Nutrition (FFE) program supports preschool and in-school food for education programs and nutrition programs for women, infants, and children in foreign countries. The program was authorized by the Farm Security and Rural Investment Act of 2002 and started operating in FY 2003. About $168.5 million of assistance was made available through the program in FY 2009. Approximately 42 percent of the total program cost was allocated for commodity expenses. The remainder of the funding was allocated as follows: 24 percent for freight and 34 percent for providing administrative expenses and other non- commodity costs. USDA programmed over 108,100 MT of commodities to support programs implemented by the WFP and PVOs. More than 4.2 million children and mothers benefited from the FY 2009 program. 856 31-g24 FY 2009 MCGOVERN-DOLE FOOD FOR EDUCATION ($ Millions) •. COUNTRY TOTAL - VALUE Angola $29.5 Bangladesh 5.3 Cambodia 1.2 Cameroon 2.9 Chad 5.5 Ethiopia 5.3 Guatemala i4.2 Guinea-Bissau 18.3 Kenya 9.5 Laos . 2.9 Liberia 9.0 Malawi - 6.1 Mozambique 7.8 Niger 13.2 Rwanda 8.8 Sierra Leone 9.9 Uganda 19.0 Subtotal" $168.4 *Includes CCC Funding authorized by the 2008 Farm Bill, COMMODITIES PROGRAMMED IN FY 2009 UNDER McGoverN-Dole FOOD FOR EDUCATION COMMODITY 000 MT Beans 6.4 Bulgur 9.0 Canned Salmon (),5 Corn . 0.5 Corn-Soy Blend 30.1 Cornmeal - 1 i.2 Dehydrated Potatoes {}.5 Peas/Lentiis 3,4 Rice 21.6 . Soybeans and Soy Products 6.4 Soybean Oil 0.5 Vegetable Oil } 0:2 Wheat 21.3 Wheat-Soy Blend 4.9 Subtotal 126.5 The following are examples of successes in FY 2009 under the McGovern-Dole Food for Education program: Cambodia: Decades of war and internal strife continue to impede Cambodia's economic growth. With a per capita GDP of $723 and an inflation rate of 19.7 percent, the purchasing power of Cambodia's currency is continuously undercut. This has major implications for the country’s largest economic sector, agriculture. Although agriculture produces 75 percent of total GDP and employs 29 percent of the workforce, poor farming practices, inadequate irrigation systems, and unfavorable market conditions subject the rural population to extreme hardships. Many families can only produce a single rice crop per year, and widespread micronutrient deficiencies are common. In response, International Relief and Development (IRD) is using 1,930 MT of McGovern-Dole-donated commodities to increase school enrollment by 29 percent, expand attendance by 20 percent and raise the continuation rate to 86 percent in 51 schools in the Kampong Chhanang province. IRD will provide nutritious, on-site meals and take- home rations for girls, for students who complete the sixth grade, and for high-performing teachers. Program 857 31-g25 activities will reach 31,100 students, 200 teachers, and 1,300 families. Each targeted school will have active health d nutrition education programs to effectively fight high undernutrition rates. uatemala: Guatemala is a food-deficit country that is facing serious economic and humanitarian problems. In eas such as the Central and Northwestern Highlands, malnutrition rates are as high as 80 percent. Over 56 percent of the population lives under the poverty line. The McGovern-Dole program has donated 13,780 MT of commodities to Asociación SHARE de Guatemala (SHARE) to increase the nutritional and educational status of children in targeted areas of the rural Mayan highlands. Its program activities include feeding children, providing take-home rations, establishing and training Parent-Teach Associations (PTAs), developing school infrastructure, promoting capacity building of indigenous organizations, and establishing school gardens for educational purposes. SHARE will directly reach over 70,000 students and 2,300 teachers. By 2011, enrollment should increase by 17 percent and attendance by 19 percent. In addition, the promotion rate should rise to 79.5 percent. Approximately 385 schools will be supported by SHARE's food for education program. - Liberia: After years of civil war and government mismanagement, Liberia's economy is weak and unstable. It is one of the poorest countries in the world with a GDP per capita of $135 in 2007. Upwards of 40 percent of the children under five suffer from malnutrition, and more than one third of the population lives below a $1 per day income level. Life expectancy is 44.7 years, and the adult literacy rate is 51.9 percent. Recently elected President Johnson Sirleaf has begun taking steps to reduce corruption, build support from international donors, and encourage private investment. With the government’s refocus on economic development and food security, International Relief Development (IRD) is implementing a 3-year McGovern-Dole-funded program in five counties in Liberia that include Montserrado, Grand Bassa, Maryland, Grand Kru, and River Gee. Program activities are targeted to benefit 30,000 students and 600 teachers and indirectly reach 25,000 families through a combination of direct feeding, health/nutrition and HIV/AIDS education, school resource and infrastructure improvement, and the building of sustainability through PTAs, school farms, and youth clubs. Within 3 years, IRD is projected to increase total enrolment by 29.5 percent and attendance by 44 percent. Over 50 percent of targeted schools will receive adequate school supplies such as pencils, paper, and chalk. Furthermore, the number of target schools receiving printed materials that support literacy and numeracy will increase by 35 percent. - Pakistan: Pakistan continues to face nutritional shortfalls. Undernutrition rates average 37 percent for children under five, and 13 percent of children are dangerously underweight. The average school life expectancy from primary to tertiary school is only 7 years, and the national literacy rate is 55 percent, McGovern-Dole assistance to the WFP since 2005 is having profound effects in the region, WFP has provided female beneficiaries in targeted food-insecure districts with access to development opportunities through three primary activities. The first focuses on improving enrollment, attendance and retention rates among girls at targeted primary schools. Second, pregnant mothers are provided with quality health services during pre- and post-natal periods. Last, WFP supported asset creation and livelihood improvement activities in order to improve the socio-economic condition of rural women and their families. WFP has reached over 6.4 million Pakistanis since its program's conception in 2005. The enrollment rate and completion rates for females in targeted schools have increased by 21.45 percent and 59 percent respectively, in 2007 alone. In the same year, deliveries by trained birth attendants increased from 51 percent to 93 percent, and 149,416 women routinely received health services. Furthermore, the number of families with access to clean drinking water increased by 63.5 percent. In FY 2009, WFP continued to receive support for these programs through the McGovern-Dole program. Uganda: Although Uganda is endowed with significant natural resources, it has been plagued with chronic political instability and erratic economic management, making it among the world’s poorest and least-developed countries. Karamoja is one of its most vulnerable regions, and its educational indicators are low. Only 18 percent of men and 6 percent of women are literate and as of 2007, only 33 percent of children were enrolled in school. The WFP is implementing a McGovern-Dole-funded program in the Karamoja region to assist the government in improving the livelihood and cognitive performance of primary school children. WFP will provide school meals to students in both day and boarding schools and allocate take-home rations to girls achieving 80 percent attendance per term. By the end of the program, these activities are projected to increase total enrollment by 30 percent, attendance for girls by 23 percent, attendance for boys by 11 percent, and the total continuation rate by 6 percent. In addition, the government of Uganda will gradually integrate itself into program administration and activities to ensure its sustainability. 858 31-g26 LOCAL AND REGIONAL FOOD AID PROCUREMENT PILOT PROJECT The 2008 Farm Bill authorized the Local and Regional Procurement (LRP) pilot project. The primary objective of the project is to use local and regional purchasing to help quickly meet urgent food needs due to food crises and disasters. The goal is to protect against a decline in food consumption, save lives, and reduce suffering. In FY 2009, $4.8 million was allocated for programming in three countries with $2.73 million for local and regional procurement of commodities and $2.02 million for associated costs including inland transportation and storage and handling. These programs were with the World Food Program (WFP). FY 2009 LOCAL AND REGIONAL FOOD AID PROCUREMENT PILOT PROJECT ($Millions) - TOTAL COUNTRY VALUE Malawi - $1.7 Mali - - i. i Tanzania 2.0 Subtotal $4.8 Below is one example of a FY 2009 success story for the LRP pilot project: - - Malawi, Malawi ranks 160th of 177 countries in the United Nations Development Programme (UNDP) 2009 Human Development Index, Half of its 12 million citizens live below the poverty line, and 20 percent of the population is extremely poor, living on less than U.S. $0.20 per day. Malawi's economy is based largely on agriculture, but land distribution is unequal as 40 percent of smallholders cultivate less than one hectare, mostly maize. Small, fragmented landholdings contribute to households’ inability to produce enough food to meet their requirements. WFP's program, with support from LRP pilot project funding, is working to address the food needs of households that are at risk of hunger and poverty. In addition to providing food to vulnerable groups, WFP will specifically focus on procuring food from smallholder farmer groups. WFP aims to purchase cereals, pulses and corn-soy blend through pro-smallholder tendering practices. The overall WFP country goal is to strengthen the engagement of smallholders and small/medium-scale traders in the markets, stimulate agricultural production and cohesion within the smallholder farmer organizations, and raise the income levels of smallholders and traders. CLIMATE CHANGE Cap and Trade programs offer the hope of addressing climate change, promoting sustainable production, and Supporting farm income. However, various Cap and Trade systems in development throughout the world are creating concern that some of the new schemes will evolve into protectionist programs that limit trade based on social criteria rather than objective scientific criteria. It is critical to take a truly global approach, and connect that approach to individual farmers. Voluntary carbon markets where “carbon offsets” have been traded since 2005 were valued at $331 million in 2007. Thus far trading in carbon offsets by U.S. farmers has been domestically focused, using the Chicago Climate Exchange. The global market’s potential long-term economic benefits for the U.S. farmer have not been fully explored, - Global Alliance Formed for Research on Agricultural Climate Change. Globally, agriculture is a significant contributor to greenhouse gas emissions and will be heavily affected by climate change. At the same time, agricultural production must increase to feed a growing world population, USDA has been instrumental in developing the concept and building international support for a global research alliance on agricultural greenhouse gas emissions that will help to ensure that agricultural emissions are well understood and that global greenhouse gas emissions decline for every unit of food produced, while contributing to ensuring food security for the future. The purpose of the alliance will be to deepen and broaden existing networks of research and build new ones, enhance scientific capacities in this area (particularly in developing countries) and effect a fundamental change in the current relationship between food production and greenhouse gases around the world. The Secretary of Agriculture and other Ministers launched this alliance at the December 2009 meeting of the Parties to the United Nations Framework Convention on Climate Change. 859 31-18 Foreign AGRICULTURAL SERVICE Summary of Budget and Performance Statement of Department Goals and Objectives. The Foreign Agricultural Service (FAS) was established on March 10, 1953, by Secretary's Memorandum No. 1320, Supplement 1. The mission of the agency is “Linking U.S. agriculture to the world to enhance export opportunities and global food security.” FAS has two strategic goals and seven strategic objectives that contribute t Goals and two high priority performance goals (HPPG). o three of the USDA Strategic USDA Strategic Agency Strategic Agency Objectives Programs that Key Outcome Goal Goal Contribute USDA Strategic Agency Goal 1: Objective 1.1; Agricultural Exports Key Outcome 1A: Goal: USDA will U.S. farmers, Improve market Exports help U.S. assist rural ranchers, and access by increasing Market Access Program; agriculture communities to agricultural adherence to rule - Foreign Market prosper. create wealth so industry maintain based international Development Program; they are self and expand trading systems. Technical Assistance for sustaining, exports. Specialty Crops Program; repopulating, and Objective 1.2: Emerging Markets economically Increase Program; Quality Samples thriving. effectiveness of Program; Export Credit marketing programs Guarantee Program through improved public and private | partnerships. Objective 1.3: increase food security, increase the value of intelligence and analysis provided to agricultural stakeholders. USDA Strategie Agency Goal 1: Objective 1.1; New Technologies Key Outcome 1B: Goal: USDA will U.S. farmers, Improve market U.S. exports of help America ranchers, and access by increasing | Borlaug Fellowship organics and promote agricultural adherence to rule- Program, Cochran crops produced competitive industry maintain based international Fellowship Program using new agricultural and expand trading systems, technologies production and exports. expand. biotechnology exports as America works to 860 3 - 19 USDA Strategic Agency Goal 2: Objective 2.1: Food Security Key Outcome 2A: Goal: USDA will U.S. agriculture's Increase in-country Food is globally help America resources support capacity to develop McGovern-Dole available, - promote food and national competitive international Food for accessible, and competitive security policies, agricultural systems. Education; Food for appropriately agricultural Progress; used. - production and Objective 2,2: Borlaug Fellowship biotechnology Promote adoption of Program; Cochran exports as science-based Fellowship Program; America works to solutions and Technical Assistance and increase food technology. Capacity-Building; security. - Civilian Response Corps; Qbjective 2.3: Agricultural Improve USDA's Reconstruction and ability to respond to Stabilization Activities international crises. Objective 2.4: Inform decision- makers with timely intelligence and analysis. USDA Strategic Agency Goal 2: Objective 2.4: Climate Change Key Outcome 2B: Goal: USDA will U.S. agriculture's Inform decision- e Climate change CIISUIrè. Oliſ resources support makers with timely provisions in national forests food and national intelligence and international and private security policies, analysis, agreements working lands are * benefit U.S. conserved, agriculture. restored, and made more resilient to climate change, while enhancing our Water reSOth CeS, Key Outcome 1A: Exports help U.S. agriculture prosper. HPPG Measure: 2009 2010 20 ! : Performance Measure Actual Target Target Number of major markets where non-tariff trade barriers were reduced n/a 5 Value of U.S. in agricultural exports ($ billions) 96.6 98.0 } 00.0 For every $1 billion worth of agricultural exports, 9,000 U.S. jobs are created and an additional $1.4 billion in economic activity is generated, Nevertheless, while U.S. farmers and ranchers are among the most productive and efficient in the world, they face unfair and complex obstacles in the global marketplace outside U.S. borders, where 95 percent of the world's consumers live. Foreign trade barriers limit exports, thereby reducing farm income and preventing job growth in the agricultural sector. Typical foreign non- tariff trade barriers facing U.S agriculture include: 861 31-20 • differences in the maximum residue levels for pesticides on crops; • outright bans on the use of some compounds that can improve food safety; and • Onerous labeling requirements. =ong-term Performance Measures: 2009 2010 2011 Performance Measure Actual Target Target Dollar value of agricultural trade preserved through trade agreement negotiation, monitoring, and enforcement (Non-Sanitary and - Phytosanitary) ($ Billions) - $0.37 $0.50 $0.53 e key to maintaining America's competitive edge in international markets is a level playing field. FAS orks to improve market access for U.S. agricultural products by eliminating tariff and non-tariff barriers as ell as other trading practices that reduce the international competitiveness of U.S. agriculture. These other ding practices include subsidies on agricultural production and exports, and involvement of government ading entities in commercial markets. - Careful monitoring and enforcement of trade agreements ensures that U.S. agriculture receives the full economic benefit of international trade agreements and trade rules. FAS provides a global monitoring system for U.S. agricultural trade through its overseas offices. Agricultural Counselors, Attachés, and Officers covering over 150 countries are often the first to hear about new or potential restrictions on U.S. rade. This global monitoring system enables USDA to act quickly to resolve bilateral market access issues or U.S. agriculture, resulting in millions of dollars of preserved trade each year. ith expanded exports, the chances increase that U.S. agriculture will encounter unexpected impediments o trade, including changing import regulations or the way they are applied, improper certification, disputes ver testing or sampling to meet quality or other criteria, and disagreements over how trade rules should be mplemented. Quick and effective resolution of these problems — without resorting to lengthy dispute ettlement procedures – is important to U.S. exporters. When problems arise for U.S. companies in foreign arkets, Agricultural Counselors and Attachés play a critical role in providing immediate assistance to prevent disruptions to trade. - 2009 2010 201 i Performance Measure Actual Target Target Value of trade preserved through USDA staff intervention leading to resolutions of barriers created by SPS or TBT measures ($ Billions) $9.5 $3.6 " $4.0 " "The methodology for this measure was revised to incorporate actual values of trade resulting from staff interventions. Previous measurements were based on estimated values of trade. Measuring the actual value of trade flows will significantly improve the accuracy of the measure. Agricultural trade is unique with respect to the risks associated with the transfer of pests and diseases. As traditional barriers, such as tariffs, have been reduced, however, the prevalence of non-tariff barriers to ade, particularly in the SPS area, increased. In spite of the WTO Agreement on the Application of SPS Measures, countries are looking increasingly to SPS barriers to protect domestic industries as global trade expands. Unnecessarily restrictive regulations to address the risks to human and animal health (sanitary) and plant health (phytosanitary) are major barriers to the expansion of global agricultural trade. FAS works o improve market access for U.S. agricultural products and reduce the harm to the industry resulting from sanitary, phytosanitary, and technical regulations, by monitoring and enforcing international SPS rules, strengthening the global SPS regulatory framework, and encouraging the adoption of international standards. - - While FAS does not generally negotiate new SPS commitments in the texts of new trade agreements, these commitments do provide the incentive for our trading partners to more quickly bring problematic SPS measures into line with international standards, 862 31-21 FAS Agricultural Counselors, Attachés, and Officers, covering over 150 countries, report routinely on SPS and technical regulations in foreign countries and work to resolve market access issues relating to these IIlê3SurcS. Selected Past Accomplishments toward Achievement of the Key Outcome; FAS has taken the following actions: Fought to gain, maintain, and expand access to foreign markets in the face of unfair trade barriers; Given U.S. government policy makers, producer groups, private exporters, and producers the market intelligence they need to develop successful market strategies; • Facilitated development of and access to markets through technical assistance and capacity building programs; - Supported commercial sales through credit guarantees and other strategic marketing support; and Provided the tools to build markets for U.S. exports. Commodity analysts and country experts in Washington and around the world provide timely analysis of global trends, which enable policy makers and private exporters to respond promptly to changes in the international market. FAS’ unique relationship with U.S. producer groups, known as cooperators, allows : U.S. agriculture to nimbly respond to such changes. In FY 2009, over 910 U.S. companies participated in 31 FAS-endorsed trade shows, reporting on-site sales totaling $74 million, and projecting estimated 12 month sales of $707 million. . . U.S. farm exports also benefit from a wide range of programs and services administered by FAS. The level of agricultural exports of $96.6 billion in FY 2009 translates to roughly 900,000 U.S. jobs. Almost one in every three farm jobs is related to exports. FAS plays a critical role in maintaining and expanding markets for U.S. farm exports. The Grains Council reported their market development programs generated approximately $50 in additional producer income for every dollar invested. Their study concluded that the Council's market development program impact on the U.S. feed grains industry was worth $915.7 million t U.S. farmers in 2008. The Export Credit Guarantee (GSM-102) program has also been particularly important during the recent global economic downturn. During FY 2009, the program facilitated sales of $5.3 billion, the second highest in the program's almost 30 year history. In addition to helping maintain U.S. agricultural exports, the GSM-102 program has also assisted some U.S. commodities to maintain market share. During FY 2009, the program supported over $700 million in feed grain exports to South Korea, keeping U.S. market share at about 85 percent. Without an active FAS presence throughout the world and particularly in key markets, such as Canada, Mexico, China, Japan, and the EU, U.S. agricultural exports would fall, creating a ripple effect in rural America through lost jobs and reduced farm incomes. FAS continuously monitors threats, such as the potential for new biotechnology and phytosanitary requirements in China that could threaten soybean exports valued at over $7 billion in 2008. More broadly, the effective monitoring and enforcement of existing trade agreements is crucial to ensuring that the benefits of these agreements accrue to rural America. And finally, capacity building programs are also utilized to promote the development of trade- friendly regulatory systems and infrastructure in emerging markets Selected Accomplishments Expected at the FY 2011 Proposed Resource Level: FAS supports the National Export Initiative, which has the primary goals of increasing economic activity and employment. Agricultural trade is an important generator of output, employment, and income in the U.S. economy. FAS will work with and through U.S. farm groups, state departments of agriculture and SRTGs, agricultural trade and industry organizations, and other USDA agencies to draw on all available expertise to maximize the positive impacts of this initiative. - Policy and negotiation activities as well as market development and credit programs, supported by FAS’ global attaché network and market analysis, provide the tools U.S. companies need to enter and compete in 863 31–22 new and difficult markets. For example, India is a huge untapped market. Without FAS activities to open up the market and create a level playing field, U.S. companies will not be able to compete with other ountries in the Indian market, which totaled $0.5 billion for agricultural trade in 2008 and might ultimately pproach the size of the $12 billion market in China. - Key Outcome 1B: U.S. exports of organics and crops produced using new technologies expand. Long-term Performance Measure: 2009 2010 20 i ! - Performance Measure Actual Target Target Total volume of U.S. exports of crops (corn, soybeans, cotton) produced using new technologies (Million Metric Tons) - 85.3 81.1 87.3 U.S. farmers have widely adopted biotechnology and other crops produced using new technologies because of productivity gains and other benefits. New agricultural crops and products derived through modern technologies are in the pipeline and could appear in the market in the next few years. However, concern bout these products, largely attributable to a lack of accurate information about their safety in other ountries, as well as opposition to the technology in general, persists in various regions. These concerns nd opposition in other countries have led to the proliferation of regulatory barriers to U.S. trade in iotechnology-derived agricultural products as well as other measures that limit the realization of the echnology’s potential to help meet food, feed, fuel, fiber, as well as other needs of their citizens. he United States is the world's largest producer of biotechnology crops. Today, almost all of the corn, oybeans, and cotton produced and exported from the United States are derived through biotechnology. e vast bulk of our biotechnology commodity and derived product exports enter commodity streams along ith conventional varieties. FAS strives to minimize unwarranted barriers to the export of biotechnology rops that have undergone appropriate safety reviews. Toward this end, FAS seeks to foster international mplementation of policies that ensure safe use of the technology, promote dispersion of its benefits, and aintain and expand trade in biotechnology products. FAS also seeks to achieve a broad and durable ublic appreciation of the importance of agricultural innovation through biotechnology and other new echnologies. -- - Selected Past Accomplishments toward Achievement of the Key Outcome; FAS promotes the acceptance of crops produced using biotechnology and other new technologies and organic standards around the world By: - - - • Working with U.S. government agencies and private industry to identify and prioritize key constraints; • Drawing on Attachés covering more than 150 countries and knowledge of negotiations to work with international organizations to develop fair, transparent international standards that will support the use of new technologies; - | Winning timely approvals for new technologies and resolving any trade disruptions related to new technologies, by drawing on relationships with agricultural counterparts in foreign governments; Working with developing countries to develop their capacity to effectively regulate and commercialize. crops produced using new technologies; and Developing educational programs to introduce government officials and other opinion leaders to the benefits of new technologies, alongside the DoS and private industry. - selected Accomplishments Expected at the FY 2011 Proposed Resource Level: FAS will support trade in J.S. agricultural products produced with new technologies, monitor worldwide developments in chnologies including their adoption by competitor countries, and promote the use of new technologies in º of food security and competitive agriculture. A proactive stance is critical because the development of diverse regulatory systems for new technologies could bring a virtual halt to trade in some commodities with a potential trade impact reaching billions of dollars, 864 31-23 The following are specific actions that FAS would support: • Promote exports of genetically engineered agricultural products and exports of other agricultural products derived from new technologies; - • Avoid trade disruptions that would directly impact U.S. farm income or slow adoption of new technologies in the United States and globally; • Strengthen initiatives that advance common approaches to risk assessment and science based regulations; - - • Encourage countries to create organic regulations and standards in line with the CODEX guidelines in order to harmonize requirements for organic products, with a view towards facilitating trade and preventing misleading claims; - • Encourage and track the notification of new and amended standards and regulations through the Technical Barriers to Trade (TBT) Committee of the WTO; and • Encourage the creation of recognition and equivalence agreements for organic products, through bilateral discussions, to reduce the burden of multiple certifications on U.S. organic producers. Key Outcome 2A; Food is globally available, accessible, and appropriately used. HPPG Measure: 2009 2010 | 2011 Performance Measure Actual Target Target Number of food secure provinces in Afghanistan - ł0 10 14 FAS efforts support implementation of the President's strategies for Afghanistan by providing technical experts who serve as advisors to key government ministries and serve on civilian-military units that work with farmers and local agricultural officials. These technical experts are essential for stabilizing strategic areas of the country, building government capacity, ensuring the successful management of assistance programs, and addressing food insecurity. - Long-term Performance Measures: 2009 2010 20 ! I - Performance Measure Actual Target Target Number of women and children assisted under McGovern-Dole (Millions) - 4.2 4.5 5.0 Food Aid Targeting Effectiveness (percent) 49% 37% 38% FAS has significant experience administering aid, technical assistance, capacity building programs, and exchange programs (e.g., McGovern-Dole, Borlaug, and Cochran) that build in-country productivity. The U.S. National Security Strategy (NSS) cites international economic development, defense, and diplomacy as the three pillars of U.S. foreign and national security policy. Food assistance and capacity building have been traditional components of U.S. economic development assistance. FAS administers the Food for Progress and McGovern-Dole International Food for Education and Child Nutrition (FFE) Programs, and the Cochran and Borlaug Fellowship Programs. The FFE Program has proven to be an effective tool to support the NSS international economic development pillar. The fundamental goal of the FFE program, successor to the Global Food for Education pilot program, is to use food as an incentive to improve education and nutrition. The key objectives of the FFE program are to reduce hunger and improve literacy and primary education, with a focus on girls. By providing school meals, teacher training, and related support, FFE projects help boost school enrollment and academic performance. The FFE program also provides nutrition programs for pregnant women, nursing mothers, infants, and preschool youngsters to sustain and improve the health and learning capacity of children before they enter school. - 865 31-24 The U.S. government, through McGovem-Dole, provides 10 percent of the World Food Program's School Feeding Program budget. For many of those children, that is the only meal they consume each day. McGovern-Dole particularly benefits girls; enrollment, attendance, and retention rates for girls would drop drastically if funding was cut, as reflected in the increase in those rates when school feeding programs are introduced. When girls go to school, it has lasting, ripple impacts - additional socio-economic gains that benefit entire societies, such as increased economic productivity, higher family incomes, delayed marriages, and improved health and survival rates for infants and children. In fact, “educating girls quite possibly yields a higher rate of return than any other investment available in the developing world” (UNESCO 2007). Without the incentive of a free school lunch, many of these girls would be kept home, creating a downward pull on their countries' development. - Cochran and Borlaug programs annually fund about 700 participants from over 75 countries who are trained and will influence decisions that result in expanded trade or support science-based practices and policies. For example, Cochran participants attend high-profile events such as the World Dairy Expo and the Produce Marketing Association Fresh Summit or undertake training in integrated pest management, SPS, food safety, biotechnology, or post harvest losses. Borlaug participants conduct research in areas critical to support the competitive production of safe food supplies. Over 13,400 participants have been trained under Cochran from 121 countries. Since 2004, over 360 fellows have been trained under Borlaug from 49 countries. - " - Selected Past Accomplishments toward Achievement of the Key Outcome; FAS is the link that enables the United States to share both its food resources and its technical expertise with those in need. Our global network of agricultural Attachés and locally engaged staff provide first-hand information on foreign agricultural markets, crop conditions, and political dynamics, an institutional knowledge of host countries and long-term relationships with foreign stakeholders. We have significant experience administering aid, technical assistance, capacity building programs, and exchange programs (e.g., McGovern-Dole International Food for Education and Child Nutrition Program, Norman Borlaug International Science and Technology Fellowship Program, and Cochran Fellowship Program) that build in-country productivity. FAS also manages USDA's component of the Civilian Response Corps and the deployment of USDA experts abroad to assist in developing competitive food systems in countries which are of high priority for meeting U.S. national security and food security objectives. These capabilities complement USAID capabilities and the overall policy lead of the DoS. Under the 2009 McGovern-Dole program, success is exemplified in Mali and Guatemala. In Mali, 28 percent of the total population is undernourished, and 69 percent is illiterate. USDA began a three year program with Catholic Relief Services (CRS) to enhance the welfare of targeted communities by improving access to food, health, and education. CRS has directly impacted the lives of over 45,000 students, teachers, and school canteen cooks through daily meals, de-worming medications, and vitamin A medications. School enrollment has increased by 8 percent and the number of girls enrolled has increased by 11 percent since the start of the program. In Guatemala, nearly 50 percent of the population lives near sustenance levels. Since 2005, USDA has worked with SHARE Guatemala to provide over 65 million daily food rations and 144,000 take-home rations, and administer micronutrients and de-worming medicines to children, women, and school personnel. As a result, school enrollment in targeted communities and attendance for both boys and girls have increased an average of 4 percent annually, and children promoted to the next grade level increased from 76.8 percent to 81.8 percent. Moreover, those enrolled in a given ear who continue enrollment in the next year, regardless of promotion, increased by 6 percent. About 700 participants from over 75 countries annually receive funding from Cochran and Borlaug programs. Once trained, they will be in a position to influence decisions that expand trade opportunities and support science-based practices and policies. Since 2004, over 360 fellows from 49 countries have been trained under the Borlaug Fellows program, Borlaug Fellows conduct research in areas critical to upport the competitive production of safe food supplies. Over 13,400 participants from 121 countries have een trained under the Cochran program. Cochran participants attend high-profile events such as the World airy Expo and the Produce Marketing Association Fresh Summit, and undertake training in integrated pest anagement, sanitary and phytosanitary policy, food safety, biotechnology, and limiting post harvest losses, 866 31-25 Through training programs, Cochran has achieved successes in trade capacity building, which is another important component of food security. Cochran has contributed to increased market access opportunities for U.S. agricultural exports. These opportunities include the following: • Colombia updated its biotechnology labeling requirements for consistency with U.S. standards; • Jamaica changed its position to support U.S. policies and initiatives at the April 2009 Codex Committee on Pesticide Residues meeting; • USDA’s resolution of meat and poultry trade issues with the Philippines resulted in a tripling of exports; - • Ukraine lifted its ban on pork imports, which will allow an estimated $24 million dollars in U.S. exports during 2009; and . . • Cochran training for the heads of Plant Quarantine Services in Kenya, Uganda, and Tanzania enabled them to initiate harmonization of phytosanitary services in the three east African countries, which is now at the approval stage for the Council of Ministers. FAS programs also support U.S. national security: • Without capacity building efforts to improve food safety, global food supplies could be threatened; • Without government-to-government capacity building efforts, there is higher risk for the spread of animal diseases, such as BSE and Avian Influenza, and plant diseases, such as UG99 wheat stem rust; • Without trade capacity building programs, global food security goals will not be met, and countries will not be able to generate income through trade; and - • In addition to FAS food security work done through appropriated funds, FAS also performs capacity building programs under reimbursable agreements with DoS and USAID. Selected Accomplishments Expected at the FY 2011 Proposed Resource Level; Technical assistance and capacity building will be provided through training programs in the United States and in foreign countries, specifically through the Cochran Fellowship Program, the Norman E. Borlaug International Agricultural Science and Technology Fellows Program, and the Faculty Exchange Programs. Since 2004, over 360 fellows have been trained under Borlaug from 49 countries. Over 13,400 participants have been trained under Cochran from 121 countries. FAS desires to continue expanding the good will and influence of that cadre of alumni. - Key outcome 2B: Climate change provisions in international agreements benefit U.S. agriculture. Long-term Performance Measure: 2009 || 2010 201 || Performance Measure - Actual Target Target Number of reports providing timely analysis of the impact on - agriculture of global climate change and international policies, - legislation, and activities - 2 15 30 One key to maintaining America's competitive edge in international markets is a level playing field that ensures that international treatment of climate change obligations and adherence to U.S. domestic climate change requirements are met. - Careful monitoring and analysis of international climate change policies, legislation, and activities ensures that U.S. agriculture receives the full benefit of international agreements and trade rules. FAS provides a global monitoring system for U.S. agricultural trade through its overseas offices. Agricultural Counselors, Attachés, and Officers covering over 150 countries are often the first to hear about issues of concern to U.S. agricultural interests. 867 31-26 Anticipated U.S legislation could provide for both import charges on products from countries with no greenhouse gas emission restrictions (beginning in 2020) and compensation to U.S. industries which may be vulnerable to import competition. This domestic legislation, coupled with an international treaty on climate change that establishes a new multilateral system where all significant contributors to global warming commit to specific actions, necessitates that Agricultural Counselors and Attachés play a critical role in providing analysis, information, and representation in international climate change activities, discussions, and negotiations. - - Selected Past Accomplishments toward Achievement of the Key Outcome: Beginning in June 2009, at the equest of the USDA Office of the Chief Economist, FAS began providing a negotiator for the agriculture discussions under the UN Framework Convention on Climate Change. FAS staff overseas has provided limited reporting on climate change and the impact on agriculture of new policies to mitigate climate change in other countries. Selected Accomplishments Expected at the FY 2011 Proposed Resource Level: FAS will continue to support the Department and U.S. agriculture by serving at international negotiations. U.S. agriculture needs a voice as international climate change rules are made and implemented. The potential benefit of supportive, trade-friendly climate change rules to U.S. producers could easily be tens of billions of dollars and thousands of jobs. If export markets are lost, U.S. farm prices and farm income will fall. FAS will continue to provide the intelligence and analysis needed to support climate change negotiations and U.S. government policy decisions. Strategic Goal Funding Matrix (On basis of appropriation) ($000) 2009 Actual 2010 Estimated 2011 Estimated Staff Staff Increase or Staff USDA Strategic Goal Amount Years. Amount Years Decrease Amount Years Agricultural Exports $111,811 496 $122,672 533 +$59,283 $181,955 533 SDA Strategic Goal limate Change $2,705 12 $2,929 12 +$143 $3,072 12 USDA Strategic Goal Food Security $34,490 153 $37,825 173 +$17,946 $55,771 #73 New Technologies $21,415 95 $23,406 101 +$1,101 $24,507 i01. otal, Goal 3 $55,905 248 $61,231 274 +$19,047 $80,278 274 Total, Available $170,421 756 $186,832 819 +$78,413 $265,305 819 868 3 : -27 FOREIGN AGRICULTURAL SERVICE Summary of Budget and Performance Key Performance Outcomes and Measures USDA Strategic Goal; USDA will assist rural communities to create wealth so they are self sustaining, repopulating, and economically thriving. Agency Goal 1: U.S. farmers, ranchers, and agricultural industry maintain and expand exports. Key Outcome: Exports help U.S. agriculture Key Performance Measures: prosper. • Dollar value of agricultural trade preserved annually through trade agreement negotiation, monitoring, and enforcement. • Value of trade preserved through USDA staff intervention leading to resolutions of barriers created by SPS (sanitary/phytosanitary) or TBT (technical barriers to trade) measures. Key Performance Targets: 2006 2007 2008 2009 2010 2011 Performance Measures Actual Actual Actual Actual Target Target --Dollar value of agricultural trade - preserved through trade agreement negotiation, monitoring, and - enforcement ($ Billions) $0.01 $0.67 $0.48 $0.37 $0.50 $0.53 --Value of trade preserved through USDA staff intervention leading to resolutions of barriers created by SPS or TBT measures ($ Billions) $2.6 $2.5 $7.3 $9.5 $3.6 '' $4.0 '' The methodology for this measure was revised to incorporate actual values of trade resulting from staff interventions. Previous measurements were based on estimated values of trade. Measuring the actual value of trade flows will significantly improve the accuracy of the measure. HPPG Measure: 2006 2007 2008 2009 2010 2011 Performance Measure Actual Actual Actual Actual Target Target Number of major markets where non- - tariff trade barriers were reduced n/a n/a n/a n/a n/a 5 Value of U.S. agricultural exports ($ Billions) 68.6 82.2 i i 5.3 96.6 98.0 100.0 USDA Strategic Goal: USDA will help America promote competitive agricultural production and biotechnology exports as America works to increase food security. Agency Goal 1: U.S. farmers, ranchers, and agricultural industry maintain and expand exports. Key Outcome: U.S. exports of organics and crops produced using new technologies expand. Key Performance Measure: Total volume of U.S. exports of crops (corn, soybeans, cotton) produced using new technologies (Million Metric Tons) 869 31-28 Key Performance Target: 2006 2007 2008 2009 2010 2011 Performance Measures Actual Actual Actual Actual Target Target --Total volume of U.S. exports of crops - (corn, soybeans, cotton) produced using - new technologies (Million Metric Tons) 96.4 84.3 90.0 85.3 81.1 87.3 Agency Goal 2: U.S. agriculture's resources support food and national security policies.