Addendum to the U.S. Environmental Protection Agency Chesapeake Bay Program Office Grant and Cooperative Agreement Guidance: May 25, 2021 A. Introduction This addendum to the 2021 EPA Chesapeake Bay Program Office (CBPO) Grant and Cooperative Agreement Guidance (Grant Guidance), which was finalized in December 2020, provides guidance on implementation of the new Assistance Listing for the Chesapeake Bay Program non-competitive funding programs and an update to the citation for the consultant fee cap regulations in Attachment 13. Additionally, this addendum provides the allocation, grant vehicle(s), eligible uses and recipients, and other important information about the FY21 most effective basin funding. B. Notice of New CFDA Assistance Listing As part of a review of the Agency’s Assistance Listings (formerly called CFDA), EPA’s Office of Grants and Debarment (OGD) determined that the public would be better informed about the purpose and results of Federal financial assistance for the Chesapeake Bay Program (CBP) by establishing two assistance listings for CBP. CBP Assistance Listing 66.466 included (1) descriptions of both funding for technical assistance and similar activities that EPA awards competitively to a wide range of organizations and (2) descriptions of funding for implementation, regulatory and accountability, and monitoring activities that EPA awards without competition and only to signatory jurisdictions of the 2014 Chesapeake Bay Agreement. The statutory authority for these two types of funding arrangements is substantially different. However, when EPA reports on Assistance Listing 66.466, the data does not differentiate between competitive funding for discrete projects and non-competitive funding for ongoing programs carried out by the signatory jurisdictions. Establishing distinct Assistance Listings for each type of funding will produce more accurate data. As of the publication date to the Federal Register (March 2021), the Assistance Listing number for CBIG, CBRAP, and monitoring CWA Sec. 117e grants is now 66.964. EPA will only require citation to this Assistance Listing on new awards for these programs. This change will have no impact on the funding for current agreements; the Assistance Listing for current awards will remain 66.466, even if supplemental or incremental amendments are issued. Additionally, the program code (PC) for CBIG, CBRAP, and monitoring grants, which was previously CB for Chesapeake Bay, will change to C2 and will be reflected on new awards. The process of downloading the non-competitive grant application will essentially be the same. The two changes include (1) instead of selecting “EPA-CEP-01” in Step 2 below, you will select “EPA-CEP-02” and (2) instead of selecting “66.466” in Step 3 below, you will select “66.964”. To download the grant application package for a non-competitive award: 1. Go to: www.grants.gov/web/grants/applicants/download-application-package.html, 2. Type “EPA-CEP-02” into the “Funding Opportunity Number” field and click “Download Package,” 3. Download the package associated with Assistance Listing 66.964, 4. Complete the Grant Application Package. Attach the forms and information identified below, and 1 5. Submit your application. See www.grants.gov/web/grants/applicants/apply-for-grants.html for more information on this process. C. Updated Citation for Consultant Fee Cap Regulations Attachment 13 – Budget Detail Guidance – cites 2 CFR 1500.9 as the location for regulatory information related to consultant fee caps. Based on regulatory updates, the citation is now 2 CFR 1500.10. D. 2021 Most Effective Basin Funding Allocations In the U.S. Environmental Protection Agency’s (EPA) Fiscal Year (FY) 2021 Appropriations Conference Report, an increase to the Chesapeake Bay Program (CBP) Budget was provided for “state-based implementation in the most effective basins.” This is an increase of $1.25 million over the FY 2020 appropriation of $6 million. EPA will use the same methodology and funding allocation that was used in FY 2020 for the original $6 million allocation, as described in Attachment 18 of the 2021 CBPO Grant Guidance. The funding rationale and methodology for the additional $1.25 million is described in this addendum. EPA and the Chesapeake Bay Partnership have renewed their commitment and focus on inclusion and equity with regard to historically underrepresented communities, including communities of color and communities of lower socioeconomic status. EPA is focusing this additional funding allocation on those areas that have been identified as being most effective for improving water quality while targeting underrepresented communities. The allocation for this funding will follow the same funding allocation used for the Chesapeake Bay Implementation Grants (CBIG). The CBIG allocation formula awards funds to the seven jurisdictional partners in the following manner: a 20% share goes to MD, PA, and VA, a 10% share goes to DC, DE, NY and WV. The following table shows the breakdown for this $1.25 million appropriation. Additional $1.25 million to be split for Original $6 million split based on most work in MEB with effective basins and targeted to Ag CBIG formula Total Award for FY21 Phase III WIP Ag Percent of Nitrogen Total Nitrogen Original Commitment Commitment MEB CBIG % MEB Overall % Total MEB Jurisdiction (million pounds) Proposed Allocation Split Allocation Awarded Allocation DC - 10% 125,000 1.72% 125,000 DE 2.2 6.08% 364,540 10% 125,000 6.75% 489,540 MD 4.2 11.60% 695,940 20% 250,000 13.05% 945,940 NY 0.5 1.38% 79,536 10% 125,000 2.82% 204,536 PA 22.3 61.60% 3,695,112 20% 250,000 54.42% 3,945,112 VA 6.7 18.51% 1,110,191 20% 250,000 18.76% 1,360,191 WV 0.3 0.83% 54,681 10% 125,000 2.48% 179,681 Totals 36.2 100.00% 6,000,000 100% 1,250,000 100% 7,250,000 The selection of MEBs for this funding allocation of $1.25 million will look at two factors: underrepresented communities and load effectiveness. Underrepresented communities will be identified based on demographic metrics from the American Community Survey which are available on the EPA Environmental Justice Screening and Mapping Tool. Low income is defined as ratio of income to cost of living that is less than two. Data is presented as a census block group with a percentage of population that is low income >=50%. Communities of 2 color are defined as all other ethnicities other than Caucasian. Data is presented as a census block group with a percentage of people of color population >= 37%. 37% is chosen to mirror the national percentage of people of color. These definitions come from work completed by the CBP Diversity Workgroup where they provided “best professional judgement” in terms of interpreting two of the metrics (communities of color and low income) to help rank areas for composite conservation and restoration benefits. Load Effectiveness for this analysis was completed in the exact same manner as it was described on page 3 of Attachment 18 with one exception. These MEBs are the result of evaluating the effect of all nonpoint source loads of nitrogen instead of just loads of nitrogen from agriculture. Additionally, the scale used to determine these MEBs is the State-River basin segmentation that was described in the earlier analysis. Eligible Uses and Recipients This funding is intended for use by state and local entities. After a Bay watershed jurisdiction or other grantee is awarded most effective basins funding, they are expected to provide this funding directly to support implementation projects, or through contracts or subgrants to state and/or local entities, based on the state and local entities’ ability to reduce nutrient loading while minimizing the impacts from impervious surfaces. This money can be used to fund both proven and new innovative practices. Here are some examples or activities that could be addressed with this funding: Tree canopy to reduce urban heat island effects, all forms of green infrastructure, and urban agriculture. The most effective basins for focusing this funding are listed below. The census blocks that are part of those basin are the areas identified for this funding. Where work in these most effective basins may not be immediately feasible, a grant recipient should contact the CBPO Project Officer for guidance on other priority effective basins. Where a jurisdiction chooses to award these funds to state or local entities, Bay watershed jurisdictions must describe in their grant work plan the mechanisms they will use to distribute their share of this funding for implementation of projects in the underrepresented communities in these basins. Implementation activities in the most effective basins will be in support of the 2014 Chesapeake Watershed Agreement, including Bay watershed jurisdictions’ Watershed Implementation Plans (WIPs) Jurisdictions should give priority to funding those activities that will accelerate the pace for meeting WIP commitments while addressing co-benefits beyond just water quality improvements. In deciding which implementation activities to fund, jurisdictions should also consider the timeliness and cost-effectiveness of the activities in contributing to nitrogen reduction. Jurisdictions are expected to be able to track BMP implementation activities they fund with this money. They should submit these practice implementation data to CBPO through the National Environmental Information Exchange Network (NEIEN), in accordance with Attachment 6 of the grant guidance. Jurisdictions should use their existing CBRAP funding if they