(5) Maximum Allowable Amount of Cost-Share Funds per
Operating Unit. The maximum allowable amount of cost-share funds that
may be applied to any single operating unit is $15,000. This provision
applies only to general revenue funds appropriated by the Texas Legislature
to assist program participants with the implementation of soil and
water conservation land improvement measures as allowed by Agriculture
Code §201.301. In cases where the funding for cost-share incentives
originates from sources other than appropriations made directly to
this program by the Texas Legislature, the maximum allowable amount
of cost-share incentive funding per operating unit will be established
by the terms of the contractual agreement providing the funds until
otherwise specified by the State Board.
(f) Eligibility for Cost-Share Incentive Funding.
  (1) Eligible person. Any individual, partnership, administrator
for a trust or estate, family-owned corporation, or other legal entity
who as an owner, lessee, tenant, or sharecropper, participates in
an agricultural or silvicultural operation and has a certified water
quality management plan on an operating unit within a SWCD shall be
eligible for cost-share incentive funding.
  (2) In accordance with the terms of this chapter an
eligible person may receive cost-share only once for an operating
unit. The State Board, on a case-by-case project or watershed basis
and in consultation with the SWCD, may grant a waiver to this requirement
in situations where:
    (A) Research and/or advanced technology indicate(s)
a plan modification to include additional measures to meet Texas surface
water quality standards is needed;
    (B) The operating unit is significantly increased in
size by the addition of new land areas or the amount of animal waste
production is significantly increased requiring additional conservation
practices, not previously cost-shared, in order to meet Texas surface
water quality standards;
    (C) More stringent measures become necessary to meet
Texas surface water quality standards;
    (D) A landowner has assumed the responsibility of a
maintenance agreement in cases where the landowner was not the applicant;
or
    (E) A landowner has previously received cost-share
through this program but an additional practice or practices has/have
been subsequently mandated by state law or the laws, rules, or regulations
of a political subdivision. This waiver is only applicable to the
mandated practice or practices and may not be applied more than one
time to a single practice.
  (3) Eligible land. Any of the following categories
of land shall be eligible for cost-share incentive funding:
    (A) Land within the State that is privately owned by
an eligible person.
    (B) Land leased by an eligible person over which he/she
has adequate control and which land is utilized as a part of his/her
operating unit.
    (C) Land owned by the State, a political subdivision
of the State, or a nonprofit organization that holds land in trust
for the state.
  (4) Ineligible lands. Allocated funds shall not be
used:
    (A) To reimburse other units of government for implementing
conservation practices.
    (B) On privately owned land not used for agricultural
or silvicultural production.
  (5) Eligible purposes. Cost-share incentive funding
shall be available only for those eligible practice measures included
in a certified water quality management plan and determined to be
needed by the SWCD to:
    (A) Reduce erosion; and/or
    (B) Improve water quality and/or quantity.
  (6) Eligible practices. Conservation practices which
the State Board has approved and which are included in the applicant's
approved water quality management plan shall be eligible for cost-share
incentive funding. The list of eligible practices will be approved
as needed by the State Board. The SWCDs shall designate their list
of eligible practices from those practices approved by the State Board.
SWCDs may request the State Board's approval to offer cost-share incentive
funding for conservation practices not included in the State Board's
list of approved practices. The use of special conservation practices
is limited to those measures that can solve unique problems in a SWCD
and which conform with one or more of the purposes of the program.
Requests for special conservation practices will be filed in writing
with the State Board in time to obtain action and notification in
writing from the State Board of its decision(s) prior to announcing
the availability of cost-share incentive funding locally for the program
year. Conservation practices may be included in a SWCD's list of eligible
practices offered for cost-share incentive funding only as approved
by the State Board.
  (7) Requirement to file an application. In order to
qualify for cost-share incentive funding, an eligible person shall
file an application with the local SWCD.
  (8) Persons required to sign applications and agreements.
All applications and agreements shall be signed by:
    (A) The eligible person and;
    (B) the landowner in cases where the eligible person
does not hold title to the land constituting the operating unit.
(g) Cost-Share Incentive Funding Processing Procedures.
  (1) Responsibility of applicants. Applicants for cost-share
incentive funding for conservation practices shall:
    (A) Complete and submit an application to the SWCD.
    (B) Where an applicant does not have an approved water
quality management plan and has not determined the anticipated total
cost of the requested measure(s), he/she, as part of the application,
may request assistance from the SWCD in developing such plan and determining
costs.
    (C) After being notified of approval and obligation
of funds by the SWCD, request technical assistance through the SWCD
to design and layout the approved practices or request approval of
alternate sources of technical assistance.
    (D) Secure any approved contractor(s) needed and all
contractual or other agreements necessary to construct or perform
the approved practice(s). Cost-share will not be allowed for work
begun before the application is approved.
    (E) Complete and sign performance and maintenance agreements
and any amendments to those agreements.
    (F) Supply the documents necessary to verify completion
of the approved practice(s) along with a completed and signed certification
of cost.
  (2) Responsibilities of SWCDs. SWCDs shall:
    (A) Establish the period(s) of time for accepting applications,
under the guidelines of the State Board, and announce the availability
of cost-share incentive funding locally.
    (B) Accept cost-share applications at the SWCD's office.
    (C) Determine eligibility of lands and persons for
cost-share incentive funding under either the SWCD's local program
for a direct allocation or under a cost-share incentive priority.
If an applicant's land is in more than one SWCD, the respective SWCD
boards of directors will review the application and agree to oversee
all works, administrate all contracts and obligate all funds from
one SWCD or prorate the funding between SWCDs.
    (D) Give initial approval to those applications that
meet the eligibility requirements.
    (E) Evaluate the initially approved applications under
either the SWCD's priority system for a direct allocation or under
a cost-share incentive priority and give final approval to the high
priority applications that can be funded.
    (F) For applications that may qualify for a cost-share
incentive priority, submit the applications to the appropriate State
Board office for confirmation of qualification and availability of
funds.
    (G) Obligate funds for the approved conservation practices
that can be funded and notify the applicant(s) that his/her conservation
practice(s) has/have been approved for cost-share incentive funding
and to proceed with installation. Allocated funds must be obligated
by the last day of April of the fiscal year allocated. All unobligated
allocations, regardless of whether they exist in a direct SWCD allocation
or a cost-share incentive priority, shall become unallocated on May
1st of each year and may be reallocated to other priorities at the
discretion of the State Board to ensure the most efficient use of
cost-share incentive funds.
    (H) Determine compliance with standards and specifications
and certify completed conservation land treatment measure(s) that
meet standards.
  (3) Amended Applications for Allocated Funds.
    (A) In the event that an adjustment to the estimated
cost of conservation practice(s) is necessitated by the final design,
the applicant shall either agree to assume the additional cost or
complete and submit an amendment to his/her application for allocated
funds to the SWCD for approval or denial by the SWCD. If the obligated
funds originate from a cost-share incentive priority, the SWCD will
confer with the State Board to determine if additional funds are available.

    (B) The SWCD may elect to adjust the amount of funds
obligated for the conservation practices, provided funds are available,
or to request additional funds from the State Board. If the obligated
funds originate from a cost-share incentive priority, the SWCD will
confer with the State Board to determine if additional funds are available.

    (C) In the event additional funds are not available,
the conservation practice(s) may be redesigned, if possible, to a
level commensurate with available funds, provided the redesign still
meets practice standards established by the State Board; or the applicant
can agree to assume full financial responsibility for the portion
of the cost of conservation practice(s) in excess of the amount authorized.

  (4) Performance Agreement. As a condition for receipt
of cost-share incentive funding for conservation practices, the eligible
person receiving the benefit of such incentive funding shall agree
to perform those measures in accordance with standards established
by the State Board. Completion of the performance agreement and the
signature of the eligible person are required prior to payment.
  (5) Maintenance Agreement. A written maintenance agreement
must be signed between the eligible person and the soil and water
conservation district wherein the eligible person(s) agrees to implement
and maintain all conservation practices included in the water quality
management plan in accordance with the implementation schedule, all
technical requirements of the applicable practice standards, and specified
life expectancies of practices until such time that the certification
of the State Board is withdrawn. The maintenance agreement shall specify
that any practices installed through the financing of cost-share incentive
funding, to any extent, must be maintained in accordance with the
applicable practice standards and specified life expectancies regardless
of whether or not the water quality management plan continues to be
certified or not. Failure to maintain cost-shared practices may result
in the requirement for all or a prorated portion of the cost-share
funding to be returned to the State Board. Completion of the maintenance
agreement and all appropriate signatures are required prior to payment.
  (6) Payment to Recipients.
    (A) The SWCD shall determine eligibility of the applicant
to receive payment of cost-share incentive funding, and provide certification
to the State Board that measure(s) have been installed consistent
with established standards.
    (B) The State Board shall issue warrants for payment
of cost share incentive funding.
  (7) Applications Held in Abeyance Because of Lack of
Funds. In those cases where funds are not available, the applications
will be held by the SWCD until allocated funds become available or
until the end of the program year. When additional funds are received,
the SWCD will obligate those funds. The SWCD may shift all unfunded
applications held in abeyance because of lack of funds that are on
hand at the end of a program year to the new program year or require
all new applications as it deems appropriate.
  (8) Applications Denied for Reasons Other Than Lack
of Funds. Applications for funds which are denied by the SWCD directors
for other than lack of funds shall be retained in the records of the
SWCD in accordance with the SWCD's established record retention policy.
Written notification of the denial shall be provided to the applicant
along with the reason(s) that the application was denied.
  (9) Applications Withdrawn. An application may be withdrawn
by the applicant at any time prior to receipt of cost-share incentive
funding by notifying the SWCD in writing that withdrawal is desired.
Applications withdrawn by the applicant shall be retained in the records
of the SWCD in accordance with the SWCD's established record retention
policy.
  (10) Appeals.
    (A) An applicant may appeal the SWCD decisions relative
to his/her application for allocated funds.
    (B) The applicant shall make any appeal in writing
to the SWCD which received his/her application for allocated funds
and shall set forth the basis for the appeal.
    (C) The SWCD shall have 60 days in which to make a
decision and notify the applicant in writing.
    (D) The decision of the SWCD may be appealed by the
applicant to the State Board.
Cont'd...