(a) In general
A producer may receive financial or technical assistance to conduct eligible activities on eligible land through a program contract entered into with the Secretary.

(b) Program contracts

(1) In general
The Secretary shall establish a program contract to be entered into with a producer to conduct eligible activities on eligible land, subject to such terms and conditions as the Secretary may establish.

(2) Application bundles

(A) In general
An eligible partner may submit to the Secretary, on behalf of producers, a bundle of applications for assistance under the program through program contracts to address a substantial portion of the conservation benefits to be achieved by the project, as defined in the partnership agreement.

(B) Priority
The Secretary may give priority to applications described in subparagraph (A).

(c) Payments

(1) In general
Subject to section 3871d of this title, the Secretary may make payments to a producer in an amount determined by the Secretary to be necessary to achieve the purposes of the program.

(2) Payments to certain producers
The Secretary may provide payments for a period of 5 years—

(A) to producers participating in a project that addresses water quantity concerns and in an amount sufficient to encourage conversion from irrigated to dryland farming; and

(B) to producers participating in a project that addresses water quality concerns and in an amount sufficient to encourage adoption of conservation practices and systems that improve nutrient management.

(3) Waiver authority
To assist in the implementation of the program, the Secretary may waive the applicability of the limitation in section 1308–3a(b)(2) of title 7 for producers if the Secretary determines that the waiver is necessary to fulfill the objectives of the program.

(d) Funding through alternative funding arrangements or grant agreements

(1) In general
A partnership agreement entered into with an eligible partner may be funded through an alternative funding arrangement or grant in accordance with this subsection.

(2) Duties of the Secretary
The Secretary shall—

(A) under a funding agreement under paragraph (1)—

(i) use funding made available to carry out this subchapter to provide funding directly to the eligible partner; and

(ii) provide technical and administrative assistance, as mutually agreed by the parties; and

(B) enter into not more than 15 alternative funding arrangements or grant agreements with 1 or more eligible partners each fiscal year.

(3) Duties of eligible partners
Under a funding agreement under paragraph (1), the eligible partner shall—

(A) carry out eligible activities on eligible land in agreement with producers to achieve conservation benefits on a regional or watershed scale, such as—

(i) infrastructure investments relating to agricultural or nonindustrial private forest production that would—

(I) benefit multiple producers; and

(II) address natural resource concerns such as drought, wildfire, or water quality impairment on the land covered by the project;

(ii) projects addressing natural resources concerns in coordination with producers, including the development and implementation of watershed, habitat, or other area restoration plans;

(iii) projects that use innovative approaches to leveraging the Federal investment in conservation with private financial mechanisms, in conjunction with agricultural production or forest resource management, such as—

(I) the provision of performance-based payments to producers; and

(II) support for an environmental market; or

(iv) other projects for which the Secretary determines that the goals and objectives of the program would be easier to achieve through the funding agreement under paragraph (1); and

(B) submit to the Secretary, in addition to any information that the Secretary requires to prepare the report under section 3871e(b) of this title, an annual report that describes the status of the project, including a description of—

(i) the use of the funds awarded under paragraph (1);

(ii) any subcontracts awarded;

(iii) the producers receiving funding through the funding agreement under paragraph (1);

(iv)

(I) the progress made by the project in addressing each natural resource concern defined in the funding agreement under paragraph (1), including in a quantified form to the extent practicable; and

(II) as appropriate, other outcomes of the project; and

(v) any other reporting data the Secretary determines are necessary to ensure compliance with the program rules.