Federal Assistance Manual Chapter 4-60

CHAPTER 4-60 ANNUAL DISTRIBUTION OF AML GRANT FUNDS

• 4-60-00 Purpose
  
• 4-60-10 Definitions
  
• 4-60-20 Responsibilities
  
• 4-60-30 Procedures

4-60-00 PURPOSE

1. This Chapter provides policy and procedures for the annual distribution of the Abandoned Mine Land (AML) grant appropriation to States and Indian Tribes.

2. This Chapter implements the changes required by the Abandoned Mine Reclamation Act of 1990 regarding the method used to distribute the AML grant appropriation.

4-60-10 DEFINITIONS

The following definitions are critical to the understanding of this chapter.

1. Distribution. The process by which OSM assigns specific amounts of the AML grant appropriation to each program State/Indian tribe based on a formula using a State/Indian tribe's percentage of the State/Tribal share of AML Fund and historical coal production, taking into account amounts for State emergency programs and the minimum program supplemental adjustment.

2. Federal Share of Grants. The portion of AML funds (appropriation, grant appropriation, grant distribution, and grant awards, deobligations, and recoveries) funded from the Federal share of the Fund, i.e., from the Historical Coal Distribution (HCD) (g)(5) account and the Federal Expenses (g)(3) account.

3. Federal Share of the Fund. The unappropriated Federal share balance of the Fund through September 30, 1991 and: (1) 50 percent of annual AML fee collections from program States and Indian tribes; (2) 100 percent of interest, penalties, administrative costs, court costs, and other miscellaneous receipts paid to OSM (e.g., proceeds from coal sales and lien payments associated with AML projects); and (3) 100 percent of fees collected in non-program States. The Federal share of the Fund consists of three accounts: (g)(2) for funding the Rural Abandoned Mine Program (RAMP); (g)(3) for funding the Federal expenses (Small Operator Assistance Program, emergency projects, projects in non-program States and Indian tribes, supplemental adjustment for minimum-level programs, and administration by the Secretary); and (g)(5) for HCD for funding grants.

4. Minimum Program. The distribution of Federal share grant funds to qualified program States/Indian tribes whose funding would otherwise be below the minimum program level (currently $1.5 million). To qualify for the minimum program adjustment, a State/Indian tribe must have sufficient unfunded inventory of AML health and safety problems (priority 1 and 2) in order to receive Federal share grant funds to raise the combination of both the State/Tribal share and Federal share of a State/Indian tribe's grant funds to the minimum program level.

5. State/Tribal Share of Grants. The portion of AML funds (grant appropriation, grant distribution, and grant awards, deobligations, and recoveries) funded from the State and Tribal share of the Fund, i.e., the (g)(1) account.

6. State and Tribal Share of the Fund. The sum of the unappropriated State and Tribal share balances in the Fund as of September 30 of the current year, and 50 percent of annual fee collections in program States and Indian tribes.

4-60-20 RESPONSIBILITIES

1. The Director approves the final distribution of the AML grant appropriation.

2. The Deputy Director (DD) reviews and concurs with the proposed annual grant distribution and approves any exception(s) to the formula-based distribution calculations. Any subsequent changes (e.g., additional funds resuballotted from emergency grant recoveries to a particular State) are considered exceptions after the annual distribution and are approved by the DD.

3. The Budget Officer supplies the AML appropriation figures for AML grants, RAMP and Federal expenses to the Division of Reclamation Support (PRS).

4. The Division of Reclamation Support (PRS) reviews the final distribution calculation for correct application of established policy and procedures, and concurs that the distribution is in accordance with this Chapter prior to DD review. The PRS coordinates exception requests (made before or after the annual distribution) for approval by the DD. The PRS takes the lead in answering policy questions regarding the distribution.

5. The Division of Financial Management (DFM) determines the amount of State/Tribal share and Federal share of grant funds to be distributed to each State and Indian tribe in accordance with this Chapter. The DFM forwards copies of the annual distribution to the Regional/Field Offices, with copies for the States and Indian tribes. The DFM takes the lead in answering questions regarding financial figures used in the distribution.

4-60-30 PROCEDURES

1. The Regional Coordinating Centers (RCCs) compile updates of the existing grant estimates for State emergency programs. The RCCs should contact emergency program States, if necessary, to verify whether the previously supplied 18-month estimate for emergency administrative and construction program costs is still accurate. State emergency program requests are to be analyzed by the RCCs based on State estimates, historical emergency expenditures in the State, and discussions with the State officials. Emergency grant estimates should not include amounts for contingencies or extremely large one-time events. Note: State emergency distribution is constrained by limitations set by congressional appropriation language.

2. The RCCs forward exception requests, together with a recommendation to approve them to PRS.

3. The DD approves State emergency grant estimates as exceptions to the distribution formula. The approved exceptions are included in the request for DFM to calculate the State/Tribal grant appropriation distribution.

4. PRS provides DFM with a listing of the total estimated cost of each State/Indian tribe's remaining inventory of priority 1 and 2 problem areas. These figures are used to adjust the minimum program supplement to either the current minimum program level or the remaining cost of priority 1 and 2 problem areas in the State/Indian tribe,whichever is less.

5. PRS defines the distribution parameters based on: provisions contained in the new fiscal year's appropriations bill and report; the Surface Mining Control and Reclamation Act of 1977 (SMCRA), this Chapter; and any approved exception and decision documents.

6. DFM provides PRS with a fee collection report which lists the individual State and Indian tribe balances of the State/Tribal share of the Fund and the unappropriated Fund balances of the Federal share accounts ((g)(2), (g)(3), and (g)(5)).

7. When the appropriation bill becomes law, the Budget Office provides the AML appropriation figures to PRS. PRS then provides the distribution parameters to DFM (see exhibit X4-60-1) and requests that the distribution calculations be completed.

8. Within 15 days of receipt of PRS's request to calculate the annual distribution, DFM will provide PRS with distribution calculations for programmatic review to assure the results adhere to the distribution parameters and this Chapter.

9. Within 15 days of PRS receipt of the distribution calculation from DFM, the AD/PS will provide acceptance of distribution calculations to the DD along with a memorandum for the Director's approval.

10. Upon approval of the AML grant appropriation distribution by the Director, the distribution is sent to the Budget Officer, AD/PS, RDs, and AD/FA for implementation.

11. DFM provides copies of the approved distribution calculations to all the Regional/Field Offices, as appropriate, accompanied by a copy for each State and Indian tribe.

EXHIBIT X4-60-1

AML GRANT DISTRIBUTION DETAILED INSTRUCTIONS

Introduction

These guidelines contain specific instructions implementing OSM policy as it relates to AML grant distribution calculations.

Distribution Formula

Exceptions to the Distribution Process

In instances where it is determined that the formula defined in these guidelines do not adequately address specific circumstances, decision documents concerning those issues will be prepared for approval by the Deputy Director prior to making the annual grant distribution calculation, where possible.

Standard Distribution Formula

AML Fund Figures

• The following figures for various AML fund components will be presented in the distribution package for informational purposes: unappropriated balance, cumulative appropriations, total collections through the end of the prior fiscal year, State and Tribal share of the Fund and Federal share of the Fund, each of the three Federal share accounts ((g)(2), (g)(3) and (g)(5)), Federal expense and RAMP appropriation, State and Tribal share of the Fund, and Federal shares of the Fund available for grants.

Funding for State Emergency Programs

• Funding for State emergency programs is deducted from the total grant appropriation before dividing the remaining grant appropriation into State/Tribal and Federal shares.

• Funding for State emergency programs approved after the annual distribution can be funded from among the following: 1) transfer of funds from the Federal Reclamation Program if provided for by Congress; 2) the pool of funds created by deobligations from prior year emergency grants; and 3) State emergency funds never granted.

• State emergency program funding is based on State estimates provided in advance of the applicable fiscal year, historical emergency expenditures, and discussions between State and Regional Office officials.

• Costs necessary to administer a State emergency program may be funded, at the discretion of the State, either from within the State's emergency distribution or from the State's non-emergency distribution.

• Monies that are recovered from prior year State emergency grants will be returned to the emergency pool and used as necessary to fund subsequent emergency program needs in any State, deobligations and unawarded State emergency grant funds from the current fiscal year will remain available to the State until the end of the fiscal year. At the end of the fiscal year, the balance of unawarded emergency funds will return to the pool.

Determining State/Tribal and Federal Shares

• The remaining grant appropriation after funding State emergency programs is split into State/Tribal and Federal shares. The amounts of State/Tribal and Federal shares are determined by multiplying the remaining grant appropriation by 55 percent to determine the amount of State share to be distributed to the States and Tribes. The remaining 45 percent is designated as preliminary Federal share.

Distribution of State/Tribal Share

• The State/Tribal share of the grant appropriation is multiplied by each State/Tribe's percentage of the total State and Tribal share balance in the Fund. The resulting dollar amount is each State/Tribe's individual State/Tribal share distribution for grants.

• Negative percentages are adjusted to zero prior to calculating the individual State/Tribal share distributions.

Preliminary Federal Share Distribution

• Each State/Tribe's percentage of the preliminary Federal share to be distributed is obtained by computing each State/Tribe's percentage of total historic coal production prior to 1978 based on data contained in OSM's environmental impact statement on the implementation of Title IV of SMCRA (published in 1979-80). Tribal data is based on coal production information contained in the Keystone Coal Manuals from 1962 through 1977.

• States/Tribes not qualifying for historical coal distribution (HCD) share funds (those States/Tribes certified or without unfunded priority 1 and 2 AML problems listed in AMLIS as of the end of the prior fiscal year) are excluded from the calculation. The remaining percentages of historical coal production are adjusted to total 100 percent.

• The preliminary Federal share of the grant appropriation is multiplied by each State/Tribe's adjusted percentage of total historic coal production, the resulting dollar amount is each State/Tribe's individual preliminary Federal share distribution before the minimum program supplemental adjustment.

Minimum Program Supplemental Adjustment

• Section 402(g)(8) of the Act establishes a minimum program funding adjustment. A State/Tribe is eligible for the minimum program if, as of the end of the prior fiscal year, the AMLIS listing for that State/Tribe contains unfunded priority 1 and 2 coal problem areas with an estimated cost of reclamation at or above the minimum program level.

• The minimum program distribution amount includes State/Tribal share, preliminary Federal share, and the supplemental adjustment amount needed for the total distribution to equal the minimum program level.

• For States and Tribes which do not meet the above minimum program criteria, the Federal share distribution is adjusted so that the total distribution equals the estimated cost of remaining priority 1 and 2 coal problems.

• The total supplemental adjustment needed to fully fund minimum program States and Tribes shall be contributed from the preliminary Federal share of non-minimum program States and Tribes.

• The minimum program supplemental adjustment is subtracted from the non-minimum program States and Tribes in proportion to each contributing State/Tribe's percentage of the total preliminary Federal share distribution for all the non-minimum program States and Tribes.

• In States/Tribes where the sum of the State/Tribal and Federal shares were above the minimum program level, but the State/Tribe's distribution was reduced below the minimum program level by the minimum program supplemental adjustment itself, the State/Tribe's distribution is brought back up to the minimum program level amount. Federal share funds that were deducted in the minimum program supplemental adjustment shall be added back into the State/Tribe's distribution up to the amount necessary to raise the State/Tribe's distribution to the minimum program level.

• The calculations are then performed again to revise the total minimum program supplemental adjustment. This supplemental adjustment amount shall come from the Federal Expenses (g)(3) share of the Fund.

Final Distribution

• The State/Tribal share distribution ((g)(1) account) plus the HCD share distribution ((g)(5) account) and minimum program supplemental adjustment ((g)(3)account) constitute the non-emergency program distribution to each State/Tribe for the fiscal year.

• Special funding situations will adjust the State/Tribe's final distribution. For example, State emergency program funding amounts ((g)(3) account) will be in addition to the State's non-emergency program distribution.

State/Tribal and Federal Shares of Unawarded Carryover

• The amount of State/Tribal share, HCD share, and Federal Expenses share (for the minimum program supplemental adjustment) distributed to each State/Tribe will be added to the amount, if any, of carryover (recoveries and unawarded distribution) of each of the above shares carried forward from the previous year for that State/Tribe.

FEDERAL ASSISTANCE MANUAL
January 2, 1998