[Code of Federal Regulations]
[Title 43, Volume 1]
[Revised as of October 1, 2002]
From the U.S. Government Printing Office via GPO Access
[CITE: 43CFR426.9]

[Page 610-611]
 
                    TITLE 43--PUBLIC LANDS: INTERIOR
 
      CHAPTER I--BUREAU OF RECLAMATION, DEPARTMENT OF THE INTERIOR
 
PART 426--ACREAGE LIMITATION RULES AND REGULATIONS (Eff. 1-1-98)--Table of Contents
 
Sec. 426.9  Religious or charitable organizations.

    (a) Definitions for purposes of this section:
    Central organization means the organization to which all 
subdivisions, such as parishes, congregations, chapters, etc., 
ultimately report.
    Religious or charitable organization means an organization or each 
congregation, chapter, parish, school, ward, or similar subdivision of a 
religious or charitable organization that is exempt from paying Federal 
taxes under Sec. 501 of the Internal Revenue Code of 1954, as amended.
    (b) Acreage limitation status of religious or charitable 
organizations that are subject to the discretionary provisions. (1) 
Religious or charitable organizations or their subdivisions that are 
subject to the discretionary provisions have qualified recipient status, 
if:
    (i) The organization's or subdivision's agricultural produce and 
proceeds from the sales of such produce are used only for charitable 
purposes;

[[Page 611]]

    (ii) The organization or subdivision, itself, operates the land; and
    (iii) No part of the net earnings of the organization or subdivision 
accrues to the benefit of any private shareholder or individual.
    (2) If Reclamation determines that a religious or charitable 
organization or any of its subdivisions does not meet the criteria 
listed in paragraph (b)(1) of this section, then:
    (i) If the central organization has not met the criteria, 
Reclamation will treat the entire organization, including all 
subdivisions, as a single entity; or
    (ii) If a subdivision has not met the criteria, only that 
subdivision and any subdivisions of it will be treated as a single 
entity and not the central organization or other subdivisions of the 
central organization; and
    (iii) In order to ascertain the acreage limitation status, 
Reclamation determines the total number of members in both the 
organization that has not met the criteria and in any subdivisions that 
are under that organization. If Reclamation determines that total number 
equals:
    (A) More than 25 members, then Reclamation treats that organization 
and every subdivision under that organization as a single legal entity 
with a limited recipient status; or
    (B) 25 members or less, then Reclamation treats that organization 
and every subdivision under that organization as a single legal entity 
with a qualified recipient status.
    (c) Acreage limitation status of prior law religious or charitable 
organizations or subdivisions. (1) Religious or charitable organizations 
and each of their subdivisions are treated as separate prior law 
corporations, if neither the district nor that religious or charitable 
organization or its subdivisions elect to conform to the discretionary 
provisions.
    (2) Reclamation will treat the entire organization, including all 
subdivisions, as a single prior law corporation, if the central 
organization or any subdivisions do not meet the criteria specified in 
paragraph (b)(1) of this section.
    (d) Affiliated farm management between a religious or charitable 
organization and a more central organization of the same affiliation. 
Reclamation permits a subdivision of a religious or charitable 
organization to retain its status as an individual entity while 
cooperating with a more central organization of the same affiliation in 
farm operation and management. Reclamation permits affiliated farm 
management regardless of whether the subdivision is the owner of the 
land being operated.