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IB96030: Soil and Water Conservation Issues Jeffrey A. Zinn August 20, 2001 CONTENTS
The FY2002 farm bill process is moving forward as the House Agriculture Committee reported its farm bill (H.R. 2646) on July 27, 2001, after numerous hearings. For conservation, this bill would provide over $16 billion in new mandatory funding over the next 10 years, with most of the additional money going to the Environmental Quality Incentive Program. It would authorize new grasslands reserve and farmland stewardship programs. Most current conservation programs would be reauthorized at higher funding levels. Administration of several conservation programs would be transferred from the Natural Resources Conservation Service to the Farm Services Agency. Alternative proposals, introduced in other bills or at hearings, are anticipated to be offered as amendments during floor debate. The Senate Agriculture Committee also has held hearings to receive options for the next generation of conservation policy, but has yet to draft a title. Chairman Harkin stated that conservation will be a significant component of its bill, which he plans to move as quickly as possible. Conservation bills introduced in the Senate include S. 932 (the Conservation Security Act) by Chairman Harkin, and S. 1326 by Senator Lugar, the ranking minority member. Current conservation policy was set through FY2002 in the most recent farm bill, the Federal Agricultural Improvement and Reform Act of 1996 (P.L. 104-127). This law reauthorized and amended the Conservation Reserve (CRP), Wetland Reserve (WRP), Conservation Compliance, and Swampbuster Programs. (The CRP is used to retire highly erodible or environmentally sensitive land; Conservation Compliance and Swampbuster Programs reduce incentives to cultivate highly erodible lands and wetlands; and the WRP uses easements to protect agricultural wetlands.) New programs it created included the Environmental Quality Incentives Program (EQIP) to provide $200 million annually in cost-sharing to producers to address conservation problems, a conservation option for producers who receive market transition payments, and farmland protection, floodplain protection, grazing lands conservation, and wildlife habitat protection programs. Agencies in the Department of Agriculture generally implement these programs, which are based on providing incentives to attract voluntary participants. Key agencies include the Natural Resources Conservation Service (NRCS), which provides technical assistance and administers many of the smaller cost-sharing programs and the Farm Service Agency (FSA), which administers the CRP and emergency programs. As both agencies implemented the 1996 farm bill provisions, controversy occurred when the Administration's interpretation of the law's intent or requirements differed from those of interested Members of Congress. Both agriculture committees held oversight hearings. These committees (and others) have also examined conservation problems that have emerged since 1996, including livestock waste management, non point water pollution issues, and the ability of agricultural lands to sequester carbon. It is likely that Congress will consider responding to each of these topics before it enacts the next farm bill. The Bush Administration has not provided any views on its priorities for the next farm bill, but its FY2002 budget proposal laid out funding priorities for conservation. The House and Senate Agriculture Committees each plan to act on new conservation legislation within an omnibus farm bill during the 107th Congress. Leaders of both committees have stated that conservation is of growing important to farm policy. Each Committee has held several days of hearings on conservation. The House Agriculture Committee completed action on its farm bill (H.R. 2646) on July 27, 2001 (H.Rept. 107-191, pt. 1). For conservation, this bill would provide over $16 billion in new funding over the next 10 years (an increase of more than 80%, according to the committee), with most of the additional money going to the Environmental Quality Incentive Program. New grasslands reserve and farmland stewardship programs would be authorized. Administration of several conservation programs would be transferred from the Natural Resources Conservation Service to the Farm Services Agency. In the Senate, Senator Harkin introduced the Conservation Security Act (S. 932). Since he has assumed the committee chair, it seems likely that this bill will be a basis for Senate action. The ranking member of the committee, Senator Lugar, introduced a different set of proposals in S. 1326. Numerous other bills addressing diverse conservation topics also have been introduced, and may be considered by the committee or on the floor. The Bush Administration has yet to announce any positions on conservation policy, but its FY2002 budget proposals identifies its conservation funding priorities. Evolution of Federal Resource Conservation Issues Conservation of soil and water resources has been a public policy issue for more than 60 years, an issue repeatedly recast as new problems have emerged or old problems have resurfaced. Two themes involving farmland productivity dominated the debate until 1985. One was to reduce the high levels of soil erosion, and the other was to provide water to agriculture in quantities and quality that enhance farm production. Congress responded repeatedly to these themes by creating new programs or revising existing ones. These programs that were designed to benefit the farmer and agriculture by resolving resource problems on the farm. These programs combined voluntary participation with technical, educational, and financial assistance incentives. By the early 1980s, however, concern was growing, especially among environmentalists, that these programs were inadequate in dealing with environmental problems caused by agricultural activities (especially off the farm), even those caused by widely accepted practices. Publicized instances of significant problems, especially soil erosion rates said to rival the dust bowl era, increased awareness and intensified the policy debate. Congress responded, in a watershed event, by enacting four major new conservation programs in the conservation title of the 1985 Food Security Act. One of these programs, the Conservation Reserve (CRP), greatly increased the federal financial commitment to conservation and targeted federal funds at some of the most severe problems. The other three, sodbuster, conservation compliance, and swampbuster, created a new approach to conservation, which halted access to federal farm program benefits to producers who did not meet conservation program requirements. Conservation provisions enacted in the next farm bill, in 1990, reflected a rapid evolution of the conservation agenda. Congress expanded this agenda beyond its focus on soil erosion to encompass additional environmental concerns. This evolution can be attributed to the growing influence of environmentalists and other non-agricultural interests in the formulation of agricultural policy, and to a recognition that agriculture was not treated like other business sectors in many environmental laws. The conservation title in 1990 addressed groundwater pollution, water quality, and sustainable agriculture, and allowed for the use of easements, as well as amending existing programs. Amendments to the CRP reflect these changes; its earlier focus on highly erodible land was expanded to include other environmental concerns. Prior to the 1994 election, conservation policy discussions centered primarily on how to build on the conservation initiatives enacted in the previous two farm bills, and on how to secure more dependable funding for programs at a time when controlling outlays to reduce the federal deficit was a major priority. Also, new concepts for resource management that considered natural systems larger than individual farms, called landscapes, watersheds or ecosystems, received increased attention. At the individual farm level, proposals to integrate the growing number of plans that farmers had to follow to implement various conservation activities, which had proliferated during the prior decade, also were discussed. The focus of these discussions, which led up to the 1995-1996 farm bill debate, shifted with the new leadership in both chambers. They became centered on identifying ways to make the conservation compliance and swampbuster programs less intrusive on farmer activities. Moreover, environmental interests initially played a diminished role in policy formulation. After President Clinton vetoed the initial farm bill that Congress had attached to the omnibus reconciliation legislation in December 1995, Congress moved quickly to pass a free-standing farm bill early in 1996. Started from the vetoed legislation, the conservation title was expanded substantially in the Senate. The bill, as enacted, restored much of the environmental focus that had been left out of earlier versions while continuing to attract support from agricultural interests. (For an overview of conservation provisions in the 1996 farm bill, see CRS Report 96-330, Conservation Provisions in the Farm Bill: A Summary.) Current Major Conservation Activities USDA's conservation effort, while diverse, centers on implementing the CRP, cost sharing programs, and compliance programs, and carrying out wetland protection responsibilities. Conservation programs are administered either by the Natural Resources Conservation Service (NRCS), which provides technical assistance to producers who wish to plan, install, and maintain conservation practices. It administers both most of the programs that provide cost-sharing assistance to producers and the compliance and wetland protection efforts. The Farm Service Agency (FSA) administers the largest cost-sharing program, the CRP and one of the emergency conservation programs. Conservation Reserve Program (CRP) Under the CRP, enacted in 1985, producers can bid to enroll highly erodible or environmentally sensitive lands into the reserve during signup periods, retiring it from production for 10 years (or longer under limited circumstances). Successful bidders receive annual rental payments, and cost-sharing and technical assistance. Enrollment is limited to 36.4 million acres in total, and to 25% of the crop land in a county. Total enrollment was 31.4 million acres at the end of FY2000, and about 135 counties, concentrated in the high plains, are at the county enrollment limit. Funding is mandatory spending. During the twelve signups held between 1986 and 1992, 36.4 million acres were enrolled. (Congress did not appropriate funds to enroll additional lands from FY1992 through FY1996.) USDA estimates that the average erosion rate on enrolled acres was reduced from 21 to less than 2 tons per acre per year. Retiring these lands also expanded wildlife habitat, enhanced water quality, and restored soil quality. The annual value of these benefits has been estimated from less than $1 billion to more than $1.5 billion; some estimates of these benefits exceed annual costs, especially in areas of heavy participation. However, there is no guarantee that program benefits will endure after contracts. The General Accounting Office has criticized the potentially ephemeral nature of these environmental benefits. Currently, annual expenditures to support existing contracts are about $1.5 billion, close to half of all conservation expenditures. The Department held one open enrollment period each year between FY1997 and FY2000. The FY1997 signup (the 15th) was large because contracts on approximately 21.4 million acres were set to expire. Bids were offered to enroll more than 23 million acres, and accepted on 16.1 million acres (including 11.7 million acres that had been enrolled). Subsequent signups have been smaller. The FY1997 enrollment period (the 16th) attracted bids on 9.5 million acres and enrolled 5.9 million acres. The FY1998 enrollment period (the 18th) attracted bids on more then 7 million acres and enrolled almost 5 million acres. The most recent enrollment ( the 20th) enrolled 2.5 million acres. In the fall of 2000, USDA announced that it would not offer an opportunity to enroll land in FY2001 and that farmers with expiring contracts would have the option of extending them for one year. USDA probably took this action because relatively few acres would be leaving the program, offering limited opportunities to enroll new acres. USDA has been preserving 4.2 million acres within the 36.4 million acre cap to enroll land in two ways outside the general enrollment periods. One of those ways allows continuous signup for individuals who wish to enroll portions of fields with particularly high environmental values. FSA staff reported that through July 2001 almost 1.6 million acres have been enrolled under this option. (More than 30% of these acres are in Iowa and Illinois.) The conservation practice that has received the most attention is buffer strips along water bodies. NRCS started a buffer initiative in 1997 to enroll 2 million miles of these strips by 2002; it estimates that over 750,000 miles have been enrolled. In April 2000, the Department announced that it was implementing three new incentives to attract more participation: paying signing bonuses; increasing cost-share payments for cover crops and making maintenance payments on buffers; and increasing payments on pasture. It estimated these payments could total up to $350 million over the next 3 years. The second way is a state-initiated enhancement program, under which higher rents are paid to attract eligible land. Maryland, the first state to be approved for this program in October 1997, is trying to enroll 100,000 acres of stream buffers, restored wetlands, and highly erodible lands along streams in a portion of the Chesapeake Bay Watershed. (Before this agreement was signed, it had less than 20,000 acres in the CRP.) The Maryland program will cost $195 million; this includes $170 million in federal money. Fourteen other states have approved enhancement programs, and seven additional states have submitted proposals. FSA data show that almost 190,000 acres had been enrolled under this option through July 2001, and almost 40% of those acres are in Illinois. Combining these three options for enrolling land, USDA forecasted in its FY2002 budget submission that the reserve would grow to 36.4 million acres by December 31, 2002. A third way to enroll land outside the general enrollment periods was created when Congress authorized a new pilot program to enroll up to 500,000 acres of farmable wetlands in six upper Midwestern states in Title XI of the FY2001 Agriculture Appropriations legislation. USDA is offering signup bonuses as an incentive to participate. Signup for this option started in June. NRCS provides technical assistance in support of CRP, but the 1996 farm bill placed a cap on the portion of program funding from the CCC that can be used to reimburse agencies for services provided in the delivery of CCC programs. The funds available under this cap have been insufficient to pay all related technical assistance costs in recent years. If funding is insufficient, NRCS may have to suspend CRP-related activities, as it did in FY1999. The FY1999 Supplemental Appropriations (P.L. 106-31) provided an additional $28 million in FY1999 and $35 million in FY2000. The FY2001 Agriculture Appropriations (P.L. 106-387) provides $35 million for technical assistance to implement the CRP (and the WRP). For FY2002, the Bush Administration is proposing an increase of $44 million in technical assistance to support the CRP, and both Chambers have provisions in their appropriations bills that would address this problem.. A new CRP concern was raised in March 2000 when the Sixth U.S. Circuit Court of Appeals ruled that farmers must pay a 15.3% self-employment tax on payments received for CRP participation after the Internal Revenue Service successfully appealed a 1996federal tax court ruling that farmers did not have to pay this tax. Program supporters fear the ruling could have a chilling effect on participation. Legislation to overturn the ruling has been reintroduced. It would not be considered by the agriculture committees or within the farm bill. (For more information on this tax issue, see CRS Report RS20564 (pdf), Conservation Reserve Payments and Self-Employment Taxes, and for CRP generally, see CRS Report 97-673, Conservation Reserve Program: Status and Current Issues.) Conservation Compliance and Sodbuster Under sodbuster provisions, established in the 1985 farm bill, producers who cultivate highly erodible land (HEL) not cultivated between 1981 and 1985 are ineligible for most major farm program benefits, including price supports and related payments. These benefits are lost for all the land the farmer operates, not just for the HEL. A smaller penalty can be imposed on producers once every 5 years if circumstances warrant. Producers who cultivate highly erodible land using an approved conservation plan are not subject to these provisions. The 1996 farm bill revised these provisions in ways that increased producer flexibility. Under conservation compliance, also established in the 1985 farm bill, producers who cultivate HEL lose the same program benefits as sodbusters unless they obtained an approved conservation plan by 1990 and had fully implemented it by the end of 1994. As under sodbuster, benefits are lost for all the land the non-complying farmer operates, and graduated penalties are available once every 5 years. Any person who had HEL enrolled in the CRP has 2 years after his contract expires to be fully in compliance (or longer if the Secretary determines that 2 years is not feasible). According to 1997 data compiled by NRCS, producers were actively applying plans on more than 97% of the tracts of land that were reviewed. NRCS estimates that soil erosion on these acres is being reduced from an average of 17 tons per year to 6 tons per year. More generally, a 1997 national survey of erosion rates taken by NRCS, showed that cropland erosion totaled about 1.9 billion tons per year. This decline in the annual rate of almost 1.4 billion tons from the 1982 survey is attributed mostly to the compliance and CRP programs. Critics, primarily from the environmental community, have contended that USDA staff has not vigorously enforced conservation requirements. The Inspector General and the U.S. General Accounting Office also have been critical of the implementation effort. Others, primarily from the agriculture community, have countered that the Department has been too vigorous, and, especially in the early years, was inconsistent in its enforcement from county to county. Many of the agriculture community concerns were addressed in the 1996 farm act. (For more background on the compliance programs, see CRS Report 96-648, Conservation Compliance for Agriculture: Status and Policy Issues.) Swampbuster and the Wetlands Reserve Program (WRP) are the main agricultural wetland protection programs. Under swampbuster, farmers who convert wetlands to produce crops lose the same federal farm program benefits as would be lost under conservation compliance or sodbuster until the wetland is restored. Swampbuster includes four major exemptions, and also allows a partial penalty once every 10 years. Provisions enacted in the 1996 farm bill generally gave producers and USDA greater flexibility under swampbuster. Implementation of swampbuster was caught up in the broader wetlands policy debate initially, but Congress has not used farm legislation to act on this debate. Some from the farm community view wetland protection efforts on agricultural lands as too extensive or overzealous, and a portion of this group also view these efforts as an unacceptable intrusion of government into the rights of private property owners, or "takings." Environmental and other groups counter that the swampbuster program has been enforced weakly and inconsistently. A central source of controversy has been that about 4 million tracts of agricultural land may contain wetlands, and only about 2.6 million tracts have received wetland determinations. New determinations will be certified. Controversies also arise over inconsistencies, such as when adjoining states use different interpretations of rules based on their physical settings that lead to different determinations. Such a controversy arose in 1999 between South Dakota and Minnesota. Some concerns raised by the agricultural community were thought to have been addressed when a Memorandum of Agreement (MOA) making NRCS responsible for all wetland determinations on agricultural lands was signed by NRCS, the U.S. Army Corps of Engineers, the U.S. Fish and Wildlife Service, and the U.S. Environmental Protection Agency (EPA) on January 6, 1994. This MOA made NRCS responsible for wetland determinations for the federal wetland regulatory program under the Clean Water Act, known as the Section 404 Program, as well as swampbuster. But aspects of implementation have proven controversial. The signatory agencies are attempting to revise the MOA to reflect changes in the 1996 farm bill; this revision process has proven difficult and has not been completed. A new issue for agriculture was raised when the Supreme Court determined, in Solid Waste Agency of Northern Cook County (SWANCC) v. U.S. Army Corps of Engineers (January, 2001) that the §404 wetland permit program should not apply to "isolated waters." One effect of this decision is that an estimated 8 million acres of agricultural wetlands that had been subject to both the §404 program and swampbuster will now be subject only to swampbuster. For more information on this decision, see CRS Report RL30849 (pdf), The Supreme Court Addresses Corps of Engineers Jurisdiction Over "Isolated Waters": The SWANCC Decision.) The second wetlands program, the WRP, was established in the 1990 farm bill. It uses easements to protect farmed wetlands. The Department had chosen to use only permanent easements prior to 1996, when Congress authorized temporary easements and long-term agreement options, and instructed that the three options be used equally. The enrollment cap is currently 1,075,000 acres. The Secretary is permitted to delegate the administration of easements to other federal or state agencies that have the necessary expertise. Since funding was made mandatory in the 1996 farm bill, appropriators have limited enrollment by placing limits on available staff most years. In addition to the annual appropriations, emergency funding was provided to enroll lands flooded in 1993 in the upper Midwest. March 2001 data from NRCS show that almost 1,050,000 acres were enrolled, and almost 35% of that total is in 3 states: Louisiana (140,000 acres), Mississippi (103,000 acres) and Arkansas (101,000 acres). Permanent easements account for almost 90% of the total. (For more information about wetlands, see CRS Issue Brief IB97014, Wetland Issues, updated regularly.) Over the past several decades, Congress has enacted cost-sharing programs that provide financial incentives to induce farmers to participate in conservation efforts. These programs pay a portion of the cost of installing or constructing approved conservation practices. Before 1996, the largest of these programs, by far, had been the Agricultural Conservation Program (ACP), administered by the Farm Service Agency and funded at between $175 and $200 million annually during the two decades preceding the early 1990s. Funding for all the small cost-sharing programs combined was always a fraction of the ACP total. In FY1995 and FY1996, Congress reduced funding for these programs as part of efforts to reduce the federal budget deficit. In 1994, Congress moved administration of almost all the small programs, but not the ACP, from FSA to NRCS. The 1996 farm act terminated the ACP and three smaller cost-sharing programs - the Great Plains Conservation Program, the Water Quality Incentives Program, and the Colorado River Basin Salinity Control Program - and replaced them with a new Environmental Quality Incentives Program (EQIP). EQIP is a mandatory spending program which supports structural, vegetative, and land management practices. Annual funding is authorized at $200 million. Half the funding is to address the needs of livestock producers. A plan is required to participate. Payments per contract are limited to $10,000 annually and to $50,000 over the life of a contract (5 to 10 years); exceptions to the annual limit are permitted. Large livestock operations, defined in regulations by USDA, are ineligible for contracts to construct animal waste management facilities. The law requires USDA to designate priority areas for more concentrated attention; USDA has allocated at least 65% of the funding for these areas, to be designated by each state. Participation has remained high; demand far exceeds available funds. For FY2000, for example, more than 16,000 contracts were signed, with a total cost of almost $177 million. These contracts are providing $140 million in financial assistance, $33 million in technical assistance and almost $4 million in educational assistance. NRCS received about 54,000 applications requesting $402 million. The Clinton Administration had repeatedly sought higher funding levels, but Congress rejected these proposals and limited funding to less than $200 million, except for FY2001, when it provided an additional $26 million in omnibus appropriations legislation at the end of the 106th Congress (P.L. 106-554), and the Department provided an additional $20 million from conservation funds provided by §211 of the Agricultural Risk Protection Act of 2001. (For further information on the early implementation of EQIP, see CRS Report 97-616 (pdf), Environmental Quality Incentives Program (EQIP): Status and Issues, last updated March 2, 1998.) Selected Other Conservation Activities Conservation includes many additional activities and programs. The list below does not include programs that have been authorized but not implemented. Also, it only includes conservation activities in USDA that are administered by NRCS and FSA, including those that are most likely to be affected by provisions in the conservation title of the next farm bill. However, several other agencies make significant contributions to the conservation effort; for example, in support of research and technical activities, the Agricultural Research Service conducts basic research on numerous topics. The Economic Research Service provides analysis of many conservation topics and played a major role in developing the Environmental Benefits Index, now used to enroll land into the CRP. The Forest Service does relevant research on forest and tree topics, and the National Agricultural Library provides information about on water quality. Conservation Technical Assistance (CTA). NRCS provides technical assistance on a voluntary basis to conserve and improve natural resources. Technical assistance is provided as a component of most conservation programs, and has amounted to just under $1 billion annually in recent years, according to data compiled by NRCS. A majority of this funding is found in Conservation Operations. NRCS characterizes technical assistance as the "intellectual capital" of the agency, allowing it to combine its scientific and technical expertise with knowledge of local conditions. Watershed Programs. NRCS has worked with local sponsors under several authorities to construct more than 10,500 structures. Benefits from these projects may include flood prevention, watershed protection, erosion and sediment control, water supply, water quality, recreation, habitat enhancement, or wetland creation or restoration. A rehabilitation program for aging small watershed structures was enacted late in the 106th Congress. The Small Watershed Rehabilitation Amendments of 2000 (§313 of P.L. 106-472) authorizes up to $90 million over 5 years. NRCS will develop a priority ranking system to determine which structures should be eligible. The law provides that federal funds can be used for 65% of the total cost of rehabilitation, with the remainder coming from local sponsors, and requires that rehabilitation projects meet the requirements of the National Environmental Policy Act. Resource Conservation and Development (RC&D). RC&D provides a framework for local people to come together to improve the economy, environment, and living standard in multi-county areas. USDA provides technical and financial assistance to councils and helps them secure funding and services from other sources. NRCS states that 348 areas encompassing more than 75% of the country have been designated, and additional requests are pending. Farmland Protection (FPP). The 1996 farm bill authorized USDA to assist state and local governments to acquire easements to limit conversion of agricultural lands to nonagricultural uses. The program was allocated $35 million from the CCC to protect between 170,000 and 340,000 acres of farmland. Eligible lands must be subject to a pending offer. From FY1996 through FY1998, $33.5 million was obligated in 19 states to place easements on 127,000 acres on 460 farms with an estimated easement value of $230 million. Interest in the program has been high, and requests have greatly exceeded funding. Congress provided additional conservation funding for FY2001, and the Department allocated $17.5 million to FPP. This legislation made certain private nonprofit organizations eligible to compete with state and local governments for these funds for the first time. The Department awarded the funds to protect about 28,000 acres in 28 states. Demand again greatly exceeded available funds. Forest Incentive Program (FIP). FIP, a line item in the NRCS budget, provides technical and financial assistance to help landowners install practices such as tree planting and timber stand improvement on non-industrial private forest lands. While forestry and farm conservation issues are closely related, all other similar forestry programs for forests on private lands are administered by the Forest Service. Forest issues for private landowners are sometimes addressed in a farm bill, and when they are, they may either be in a conservation title or in a separate title. (For more information on relevant programs, see CRS Report RL31065 (pdf), Forestry Assistance Programs.) Wildlife. Cost-sharing to develop and implement a Wildlife Habitat Improvement Program (WHIP) was authorized in 1996, using $50 million from mandatory funds allocated to the CRP. The FY1998 appropriations obligated $30 million, and the remaining $20 million was obligated in FY1999. In other sections of the 1996 conservation title, wildlife was given greater recognition. Congress provided additional conservation funding for FY2001, and the Department allocated $12.5 million to WHIP. Emergency Programs. The Emergency Watershed Program is administered by the NRCS and the Emergency Conservation Program is administered by the FSA. The Emergency Watershed Program provides technical and cost sharing assistance for projects that restore land after flooding and protect it from future damage. The Emergency Conservation Program provides cost-sharing and technical assistance to rehabilitate farmland damages by natural disasters, and to carry out emergency water conservation measures during severe drought. Water Quality. Groundwater and nonpoint pollution have emerged as major issues as more instances of contamination in which agricultural sources play major roles have been identified. As the specific instances that drive public interest and concern mount, such as a very large hog farm waste spill in North Carolina, the outbreak Pfisteria and fish kills in portions of the Chesapeake Bay, or the discovery of a large "dead zone" in the central Gulf of Mexico, questions are being raised about the extent of the problems, the severity of the potential threat to human health, the adequacy of government programs, and the contribution of agriculture. In some cases, contamination may have resulted even though producers followed accepted agricultural practices, and did not commit illegal acts. Also, a large issue at many locations, odor, is addressed by local and state programs. Current conservation programs that are used to address water quality concerns center on the EQIP program, plus both the Enhancement Program (CREP) and the continuous enrollment option under CRP. During the 106th Congress, both agriculture committees held hearings to examine proposals to address water quality topics and review the effectiveness and shortcomings of current programs. NRCS released proposed revisions to its nutrient management policy, which are designed to help the farm community more effectively address these topics, on June 30, 1998. USDA and EPA released a "unified national strategy for animal feeding operations." on March 9, 1999. Elements in the strategy are controversial because it would greatly expand the number of animal operations at which nutrient management plans would be required. In early August 1999, EPA released a long-awaited draft plan for issuing Clean Water Act permits, which is required under court order. Large operators will be required to develop comprehensive nutrient management plans while smaller operators will be encouraged to develop them. The comment period on the proposed rule was scheduled to end on May 14, but was extended. Because of the court order, EPA must release the final rule by December 15, 2002. President Clinton announced on August 14, 1999, a proposal for cleaning up polluted waterways based on strengthening "total maximum daily loading" (TMDL) requirements. At an October 28, 1999 hearing convened by the House Agriculture Committee's Subcommittee on Department Operations, members received testimony on this effort. Congress included a rider in H.R. 4425, the FY2001 Military Construction and FY2000 Urgent Supplemental Appropriations bill, prohibiting EPA from using FY2000 or FY2001 funds to implement the TMDL proposal. The Clinton Administration responded by issuing a revised rule the day before the President signed the bill, July 11, 2000. The revised rule does delay the effective date of the program until October 31, 2001. (For more information, see CRS Report RL30437, Water Quality Initiatives and Agriculture.) Private Grazing Lands. A new voluntary coordinated technical and educational assistance program was enacted in the 1996 farm bill to maintain and improve resource conditions on private grazing lands. Appropriations were authorized at $20 million in FY1996, $40 million in FY1997, and $60 million annually thereafter. Congress has not established a separate program, but continues to earmark a portion of NRCS's Conservation Operations funds for this effort annually, providing $18 million for FY2001. Air Quality. The 1996 farm bill created an interagency air quality task force in USDA. The task force represented USDA when it responded to EPA's proposals, under court order, to promulgate revisions to the National Ambient Air Quality Standards for ground-level ozone and two sizes of particulates in 1997. Many in the agriculture community questioning the scientific basis and economic consequences of these proposals. The task force raised scientific questions in its official response. Cooperation on air quality issues grew after USDA and EPA signed a Memorandum of Agreement in January 1998. More recently, federal agencies have been discussing the role agricultural practices, such as tillage, and programs, such as the CRP, could play in global warming, especially by sequestering carbon. (For more information, see CRS Report 97-670, Agriculture and EPA;'s Proposed Air Quality Standards for Ozone and Particulates.) Research and Technical Activities. Research and technical support includes activities in several USDA agencies. NRCS provides basic data about resource conditions and characteristics through the soil and snow surveys, and does applied research to support conservation programs through the plant material centers. It also provides basic information on changing resource conditions on private lands through the National Resource Inventory, conducted every 5 years. State Technical Committees. State Technical Committees were created in the 1990 farm bill to provide a forum where diverse interests can provide input to state conservationists. Provisions enacted in 1996 expanded membership eligibility to include agricultural producers, representatives from agribusiness and non-profit groups, and individuals with demonstrated expertise and required committees to hold open meetings, to establish procedures for evaluating new conservation practices, and to establish priorities for state initiatives under EQIP. FY2002. Agriculture appropriations, which includes conservation funding, has been approved by the House (H.R. 2330) and reported by the Senate Appropriations Committee (S. 1191); the Senate is scheduled to take up agriculture appropriations shortly after returning from its August recess. Proposed conservation funding for FY2002 is being viewed from two different perspectives. In one view, which disregards the numerous single year increases that were adopted for FY2001 in legislation other than agriculture appropriations, the Bush Administration proposed a slight increase in program level funding for agricultural conservation programs in its FY2002 budget submission. However, if one considers those increases, the proposal was a substantial decrease. Conservation advocates had sought these increases for several years, and the Clinton Administration and Congress both supported them in FY2001, probably because of the emerging budget surplus and because some programs had reached their mandated enrollment or funding caps. The Bush Administration did not request higher funding levels or raised acreage caps, or any other response to the high demand for conservation programs that current funding levels do not meet. Discretionary Programs. S. 1191 provides a total of $984.4 million for discretionary USDA programs, while H.R. 2330 provides $954 million. Both amounts are greater than the $928.6 million requested by the Bush Administration, and are increases above the FY2001 total of $871.6 million. For the core technical assistance effort, the Conservation Operations Program, S. 1191 provides $802.5 million, while H.R. 2330 provides $782.8 million. Both amounts exceed the Administration request of $773.5 million and the FY2001 appropriated level of $712.5 million. The Administration had requested that a portion of the additional funds be used to make up to $44 million available for technical assistance in support of the CRP. H.R. 2330 provides $39 million for this purpose, of which $8.5 million would be reimbursed by the CCC. The Senate bill handles this need in a general provision of S. 1131 (§734) by permitting a transfer of up to $26 million from EQIP and by applying up to $18 million in savings from limiting enrollment in the CRP under the CREP and continuous enrollment options. Both bills also include numerous earmarks; among the largest is increased funding for the Grazing Lands Initiative. For the FIP, H.R. 2330 concurs with the Administration proposal by providing no funding, while S. 1131 provides $7.8 million. (The Clinton Administration had proposed no funding the three preceding years.) Also, the budget request did not seek funds for emergency programs, which the Bush Administration proposed to replace with a government-wide National Emergency Reserve to be available for all emergencies. Neither chamber has acted on this proposal, and neither bill provides any funding for emergency programs. For other discretionary line items, both bills support funding levels that are at least equal to the Administration request. These amounts (and the FY2001 funding levels) include: for Watershed Surveys and Planning, $11 million in both bills and by the Administration ($11 million in FY2001); for Watershed and Flood Prevention Operations, $100 million by the Senate and the Administration, and $111 million by the House ($99 million in FY2001); and for the Resource Conservation and Development Program, $48 million in both bills and $43 million by the Administration ($42 million in FY2001). Both bills include numerous earmarks, concentrated in Watershed Operations. Among the most notable in addition to specific projects are a $45.5 million limitation on technical assistance through Watershed Operations, and full funding for all the Resource Conservation and Development Councils, including the pending backlog of applications. The House proposes $5.4 million in new budget authority to restore aging watershed projects in Watershed Operations; the Senate provides $10 million to rehabilitate these projects in a new separate line item. Mandatory Programs. Seven conservation programs receive mandatory funding through the CCC. Congress has repeatedly prohibited the CCC from funding one of these programs, the Conservation Farm Option. Another program, the CRP, continues to be below its enrollment ceiling of 36.4 million acres, so it can enroll additional land. The other five programs received one-time funding in the FY2001 appropriations, and this funding allowed four of them to exceed their authorized caps. These programs (and the FY2001 program level and cap reached) include: the WRP ($162 million, cap raised to 1,075,000 acres in FY2001); Wildlife Habitat Incentives Program (WHIP) ($12.5 million, capped at $50 million); Farmland Protection Program (FPP) ($17.5 million, capped at $35 million). EQIP, which is authorized at $200 million annually, but has been limited to $174 million in recent years, received additional funding totaling $46 million in FY2001. However, the Bush Administration proposed to fund it at $174 million in FY2002. The House bill fully funds it, while the Senate bill, as noted above, would allow up to $26 million to pay for technical assistance in support of the CRP. Non-federal Sources of Conservation Assistance. Beyond federal resources, state agencies and conservation districts provide a growing portion of the staff and funds supporting conservation. The National Association of Conservation Districts estimated that conservation districts employed over 23,000 and state conservation agencies over 1,000, and that these organizations had $700 million in operating funds and $400 million in financial incentives for program participants in FY1997. NRCS estimates that funding from these sources is now slightly more than $1 billion annually. (For a somewhat more detailed discussion of FY2001 appropriations for conservation, see CRS Report RL30501, Appropriations for FY2001: U.S. Department of Agriculture and Related Agencies. Farm Bill Proposals for Resource Conservation Many farm bill proposals for conservation center on expanding or amending existing programs rather than create new ones, and reaffirm the traditional approaches to federal conservation policy -- technical assistance and cost-sharing, supported by research and education. The most recent congressional review of the overall agricultural conservation effort, which led to the 1996 farm bill, reaffirmed the traditional approaches while changing the resource conservation effort in several ways that go beyond individual provisions and programs.
The role of conservation continues to evolve, challenging existing programs and agencies. Many issues that define this role are being discussed as Congress considers the next farm bill. Many groups have identified conservation needs and proposed solutions. Both committees have held numerous hearings on conservation, and agriculture leaders in both Chambers have stated that conservation will be an important component of this farm bill. The Bush Administration has not formally offered its recommendations for the next farm bill. Adding some confusion to the situation is the changeover to Democratic Party control in the Senate, which means that Senator Harkin is likely to make his Conservation Security Act proposal (S. 932) a centerpiece of committee efforts. Many, but especially Senator Harkin, have called for conservation programs to play a more prominent role in farm policy. Many witnesses suggested that total annual conservation funding should grow from more than $3 billion to between $6 billion and $10 billion. Debates in recent farm bills generally had centered on enacting new programs to address unserved needs rather than increasing funding of existing programs to respond to unmet demands. With the exception of widespread interest in a new program to protect and restore grasslands, and more limited interest in using farm programs to sequester carbon as a response to global warming, the focus this time is on amending existing programs and providing more funds. Another prominent issue is whether to alter the current funding balance between land retirement programs and programs that assist land owners on the so-called working private lands (currently, about half of all conservation funding goes to each category). Senator Harkin's Conservation Security Act would provide more funding to working lands using "green payments." One other consideration that has become more prominent is the role that conservation programs can play in meeting world trade obligations. Conservation programs are considered to meet those obligation, or to be in the green box, so long as eligibility for conservation payments is based on fulfilling conservation requirements, and is limited to the costs of complying with these requirements. Many proposals for the next farm bill have been introduced. Some address single conservation topics, while others are omnibus proposals. Leaders in both agriculture committees have accelerated the process of writing this bill as concern grows that there will be less funds available for agriculture (and all other areas) where Congress seeks to expand program funding as the economy grows and federal revenues drop. The tax reduction legislation and slowdown in the economy have removed much of the money that might otherwise be available, and the next budget estimate, to be released by the Congressional Budget Office later in August, is likely to further constrain the funding possibilities. In this setting, the farm bill debate has been about preserving funding to go to agriculture as well as about policy options. Responding to these pressures, the House Agriculture Committee moved quickly to pass a farm bill (H.R. 2646) before the August recess that reflects the budget allocations to agriculture through FY2011. In the conservation title, the Committee bill generally funds existing programs rather than creates new ones, but it would move administration of EQIP, a new Grasslands Reserve Program, sodbuster, and swampbuster from NRCS to FSA. The Committee emphasizes that these provisions would increase conservation funding by 80% above current program levels. Among the major conservation provisions that apply to specific programs are to:
Senator Harkin has repeatedly stated that the Senate Agriculture Committee will move as quickly as possible on its version of a new farm bill, but he has offered no time line. No draft of a proposal, either as a concept or in legislative language, has been released beyond the introduction of his Conservation Security Act proposal (S. 932). Senator Lugar, the ranking member of the committee has introduced a set of conservation proposals in S. 1326. Numerous bills with conservation provisions have been introduced; the bills listed below are a sampling. This list does include all the omnibus conservation bills. H.R. 1938 (Moran of
Kansas) H.R. 2375 (Kind)
H.R. 2480 (Lucas)
H.R. 2646 (Combest)
S. 785 (Brownback)
S. 932 (Harkin)/H.R. 1949 (Thune)
S. 1267 (Roberts)
S. 1326 (Lugar) CONGRESSIONAL HEARINGS, REPORTS, AND DOCUMENTS U.S. Congress. House. Committee on Agriculture. Subcommittee on Department Operations, Oversight, Nutrition, and Forestry. The Impact of the Proposed Total Maximum Daily Load Regulations on Agriculture and Silviculture. Hearings. 106th Congress, 2nd session. May 22, June 19, and June 20, 2000. 296 p. Serial No. 106-53. U.S. Congress. House. Committee on Agriculture. Subcommittee on General Farm Commodities, Resource Conservation, and Credit. Review of USDA's Administration of the CRP. Hearings, 106th Congress, 1st session. July 22, 1999. 96 p. Serial No. 106-30. U.S. Congress. House. Committee on Agriculture. Subcommittee on Water Resources and Environment. H.R. 728, The Small Watershed Rehabilitation Amendments of 1999and the Natural Resource Conservation Service's Small Watershed Program. Hearings, 106th Congress, 1st session. Sept. 24, 1999. 63p. Serial No. 106-40. U.S. Congress. Senate. Committee on Agriculture. Farmland Protection Program. Hearings, 106th Congress, 1st session. July 21, 1999. 113p. S. Hrg. 106-422. U.S. Congress. Senate. Committee on Agriculture, Subcommittee on Forestry, Conservation, and Rural Revitalization. Farmland Protection Program. Hearings, 106th Congress, 2nd session. September 18, 2000. 61p. S. Hrg. 106-947. U.S. Congress. Senate. Committee on Agriculture, Subcommittee on Research, Nutrition, and General Legislation. Carbon Cycle Research and Agriculture's Role in Reducing Climate Change. Hearings, 106th Congress, 2nd session. May 4, 2000. 116 p. S. Hrg. 106-905. U.S. Department of Agriculture. Economic Research Service. Agricultural Resources and Environmental Indicators, 1996-1997. Washington, July 1997. 347 p. Agricultural Handbook No. 712. -----. Agri-Environmental Policy at the Crossroads: Guideposts on a Changing Landscape. Washington, January 2001. 66p. Agricultural Economic Report No. 794. U.S. Department of Agriculture. Natural Resources Conservation Service. America's Private Land: A Geography of Hope. Washington. 1996. 81 p. CRS Reports CRS Report RS30501. Appropriations for FY2002: Department of Agriculture and Related Agencies, coordinated by Ralph M. Chite. CRS Report 98-451 (pdf). Animal Waste Management and the Environment: Background for Current Issues, by Claudia Copeland and Jeffrey Zinn. 40 p. CRS Report 96-330. Conservation Provisions in the 1996 Farm Bill: A Summary, by Jeffrey Zinn. 6 p. CRS Report 96-648. Conservation Compliance for Agriculture: Status and Policy Issues, by Jeffrey Zinn. 6 p. CRS Report RL30331 (pdf). Conservation Spending in Agriculture: Trends and Implications, by Jeffrey Zinn. 11 p. CRS Report 97-673. Conservation Reserve Program: Status and Current Issues, by Jeffrey Zinn. 6 p. CRS Report 97-616 (pdf). Environmental Quality Incentives Program (EQIP): Status and Issues, by Jeffrey Zinn and Geoffrey Becker. 6 p. CRS Report RL31065 (pdf). Forestry Assistance Programs, by Ross Gorte. 20p. CRS Report RL30437. Water Quality Initiatives and Agriculture, by Claudia Copeland. 29 p. Return to CONTENTS section of this Issue Brief.
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