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Working land conservation programs support adoption and
maintenance of land management and structural conservation
practices on agricultural land, including cropland, grazing
land, and in some cases, forest land.
Key changes
Funding is significantly increased
through expansion of existing programs and creation of new
programs. Roughly $5.7 billion in Commodity
Credit Corporation (CCC) funding is available over the
next 6 years (2002-07) for the Environmental
Quality Incentives Program (EQIP), Wildlife
Habitat Incentives Program (WHIP), and Conservation
Security Program (CSP). More than $12 billion is available
over 10 years (2002-11).
EQIP's focus on livestock producers increases, with 60
percent of funding earmarked for livestock producers, up from
50 percent in the 1996 Farm Act. Limits on the size of
participating livestock operations, which excluded operations
with more than 1,000 animal units, are eliminated. Payments
are limited to a total of $450,000 per operation over the
6-year life of the Act. Participating livestock operations are
required to develop a comprehensive nutrient management plan.
EQIP will also put greater emphasis on water conservation.
A new, separate fund for ground and surface water conservation
activities is established within EQIP.
Changes in EQIP's procedures for assessing contract offers
include the following:
- Priority areas are eliminated.
- Maximization of environmental benefits per dollar of
program expenditure is no longer required, although
"optimization of environmental benefits" is cited as a
purpose of the program.
- "Bidding down" is eliminated. For contract offers with
comparable environmental values, the Secretary of
Agriculture cannot assign higher priority to an application
based only on a lower bid (for cost sharing) from the
operator.
- Higher priority can be given to producers who 1) use
cost-effective conservation practices and 2) address
national conservation priorities.
Summary of provisions
- The Environmental Quality Incentives Program
provides technical assistance, cost sharing, and incentive
payments to assist livestock and crop producers with
conservation and environmental improvements. Cost sharing
(up to 75 percent) or incentive payments can be provided for
a wide range of practices, including nutrient management,
livestock waste handling, conservation tillage, terraces,
and filter strips. EQIP is unique in its heavy focus on
livestock producers.
- The newly created Conservation Security Program
will provide payments to producers for maintaining or
adopting structural and/or land management practices that
address a wide range of local and/or national resource
concerns. As with EQIP, a wide range of practices can be
subsidized. But CSP will focus on land-based practices and
specifically excludes livestock waste-handling facilities.
Producers can participate at one of three tiers; higher
tiers require greater conservation effort and offer higher
payments. The lowest cost practices that meet conservation
standards must be used.
- The Wildlife Habitat Incentives Program provides
cost sharing to landowners and producers to develop and
improve wildlife habitat.
Economic implications
Funding for conservation on
working agricultural land is increasing relative to funding
for land retirement. Because past conservation funding focused
on land retirement, increased funding for working land
constitutes a significant change in overall conservation
program emphasis. EQIP and the newly initiated CSP are slated
to receive new funding of $11 billion over 10 years. The
Congressional Budget Office estimates that increasing CRP and
WRP acreage caps will increase land retirement spending by $3
billion over the same period (from the April 2002 baseline).
Expansion of working land programs will make a broader array
of conservation options available to a larger group of
producers. The increase in the number of programs available
may provide the flexibility needed to develop conservation
systems that deliver agri-environmental gains at the lowest
possible cost.
Changes in EQIP bid assessment procedures, however, may
reduce the overall level of environmental benefit per dollar
of program expenditure. Although "optimization of
environmental benefits" is cited as a purpose of the program,
the requirement to maximize environmental benefits per dollar
of program expenditure is eliminated. Eliminating priority
areas will make it more difficult to target EQIP funds to
areas with the greatest environmental need. The ability of
producers to enhance prospects for enrollment and reduce
program cost by lowering bids (bidding down) is eliminated,
increasing the cost of some contracts. CSP does not allow
benefit-cost targeting.
EQIP's heavy focus on livestock operations and removal of
limits on the size of eligible livestock operations may help
assist larger livestock operations in complying with proposed
Clean Water Act regulations governing animal waste management
in large confined animal feeding operations. Greater funding
for working land conservation will also aid a wide range of
producers in complying with possible requirements related to
total maximum daily loads for watersheds under Clean Water Act
regulations currently being formulated by the U.S.
Environmental Protection Agency.
Finally, the large increase in funding for working land
conservation may have impacts beyond the farm sector. As
participating producers adjust production practices to comply
with program requirements, demand could increase for various
inputs (e.g., manure handling equipment), agriculture-related
services (e.g., crop consultant services), and technical
assistance (which can now be provided by private companies
that are certified by the Secretary).
For more information...
For program agency information...
- Farm
Service Agency—Administers the Conservation Reserve
Program, the Conservation Reserve Enhancement Program, and
other conservation programs.
- Natural
Resources Conservation Service—Administers the
Environmental Quality Improvement Program, Wetland Reserve
Program, Wildlife Habitat Improvement Program, Farmland
Protection Program, and other conservation programs.
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