Natural Resources Conservation Service (NRCS), USDA.
Notice of Determination.
NRCS is providing public notice that the Secretary of Agriculture has determined the payments made under Pennsylvania's Upper Makefield Township Riparian Restoration and Preservation Grant Program are primarily for the purpose of protecting or restoring the environment. NRCS was assigned technical and administrative responsibility for reviewing the Upper Makefield Township Riparian Restoration and Preservation Grant Program and making appropriate recommendations for the Secretary's determination of primary purpose. This determination is in accordance with section 126 of the Internal Revenue Code of 1954, as amended (26 U.S.C. 126), and permits recipients of cost-share payments to exclude from gross income to the extent allowed by the Internal Revenue Service.Start Further Info
FOR FURTHER INFORMATION CONTACT:
Township Solicitor, Upper Makefield Township, 1076 Eagle Road, Newtown, Pennsylvania 18940; or NRCS, Financial Assistance Programs Division, Post Office Box 2890, Washington, DC 20013.End Further Info End Preamble Start Supplemental Information
Under Section 126(a)(10) of the Internal Revenue Code, gross income does not include the “excludable portion” of payments received under any program of a State under which payments are made to individuals primarily for the purpose of protecting or restoring the environment. In general, a payment for selected conservation practices is exempt from Federal taxation, if it meets three tests: (1) Was for a capital expense; (2) does not substantially increase the operator's annual income from the property for which it is made; and (3) the Secretary of Agriculture certified that the payment was made primarily for conserving soil and water resources, protecting or restoring the environment, improving forests, or providing habitat for wildlife. The Secretary of Agriculture evaluates a conservation program on the basis of criteria set forth in 7 CFR part 14, and makes a “primary purpose” determination for the payments made under the program. The Start Printed Page 42544objective of the determinations made under part 14 is to provide maximum conservation, environmental protection or restoration, forestry improvement, and wildlife benefits to the general public from the operation of applicable programs. Final determinations are made on the basis of program, category of practices, or individual practices. Following a primary purpose determination by the Secretary of Agriculture, the Secretary of the Treasury determines if the payments made under the conservation program substantially increase the annual income derived from the property benefited by the payments.
The Upper Makefield Township Riparian Restoration and Preservation Grant Program will use grant funds to work with landowners in the Houghs Creek watershed to implement practices in an established riparian buffer zone that is 200 feet either side of the creek stream channel. The riparian zone goals are to reduce the amount of nutrients, sediment, organic matter, pesticides, and other harmful substances from reaching the water; provide shade along the creek's watercourses to moderate stream temperature and protect fish habitat; provide streambank stability to control sediment and erosion; and conserve existing natural features important for the protection of headwater areas, floodplains, springs, streams, woodlands, and prime wildlife habitats.
By promoting the establishment of tree plantings, restorative vegetation, and streambank repair in the riparian buffer zone, the Riparian Restoration and Preservation Grant Program will provide payments to landowner participants that are primarily for the purpose of conserving soil and water resources, protecting or restoring the environment, improving forests, or providing habitat for wildlife.
A “Record of Decision” has been prepared and is available upon request from NRCS, Financial Assistance Programs Division, Post Office Box 2890, Washington, DC 20013.Start Signature
Signed in Washington, DC, on July 1, 2008.
Arlen L. Lancaster,
Chief, Natural Resources Conservation Service.
[FR Doc. E8-16748 Filed 7-21-08; 8:45 am]
BILLING CODE 3410-16-P