The Conservation Title of the Federal Agricultural Improvement & Reform Act of 1996

The newest farm bill, called the Federal Agricultural Improvement and Reform (FAIR) Act of 1996, phases out most farm subsidies over the next seven years. Producers will be required to continue conservation programs such as conservation compliance, but FAIR increased conservation funding by more than $2.2 billion, while simplifying existing conservation programs and creating new programs to address high priority environmental goals. Overall, Title III on Conservation is expected to help farmers with their conservation efforts by giving them flexibility to produce as they see fit and by providing them with more financial assistance to adopt conservation measures. A summary of the Conservation title is given.

ENVIRONMENTAL CONSERVATION ACREAGE RESERVE PROGRAM (ECARP)

The Environmental Conservation Acreage Reserve Program groups together the existing Conservation Reserve Program (CRP), the new Environmental Quality Incentives Program (EQIP), the Wetland Reserve Program (WRP) and a Farmland Protection Program (FPP).

Conservation Reserve Program
The CRP protects highly erodible and environmentally sensitive lands with grass, trees, and other long-term cover. Initially established in 1985, the program was continued as described below:

  - Allows up to 36.4 million acres to be enrolled at any one time.
  - A maximum of 25 percent of county cropland can be enrolled between CRP
    and WRP
  - Allows owners or operators who entered into a contract before 1995 an early
    out, if:
         The CRP contract was initiated prior to January 1, 1995
         The contract has been in effect for at least 5 years
         The land is not environmentally sensitive: filterstrips, waterways,
         strips adjacent to riparian areas, windbreaks and shelterbelts, land
         with an erodibility index greater than 15, or others determined by
         the Secretary of Agriculture.
  - Gives the Secretary discretionary authority to offer future early outs for
    CRP acres. 
Environmental Quality Incentives
The Environmental Quality Incentives Program combines the functions of the Agricultural Conservation Program, Water Quality Incentives Program, Great Plains Conservation Program and the Colorado River Basin Salinity Control Program. EQIP is funded at $130 million in fiscal year 1996 and $200 million annually thereafter. Livestock-related conservation practices will receive 50 percent of program funding. Other features include:
   - The establishment of conservation priority areas where significant water,
     soil, and related natural resource problems exist, in cooperation with
     state and federal agencies and with the state technical committees. 
   - The establishment of 5- to 10-year contracts for technical assistance and
     up to 75 percent of the costs of conservation practices such as manure
     management systems, pest management, and erosion control. 
   - Exclusion of large livestock operations from cost-share assistance for animal
     waste management facilities (but they do remain eligible for technical
     assistance).  Large is over 700 dairy cattle; 1,000 beef cattle; 100,000 laying
     hens or broilers; 55,000 turkeys; 2,500 swine; or 10,000 sheep or lambs.
   - Limits on total cost-share and incentive payments to any person to $10,000
     annually, and to $50,000 for the life of the contract. 
Wetlands Reserve Program
The WRP targets wetlands for the purposes of enhancing water quality and providing wildlife benefits, while recognizing landowner rights. Acreage will be allowed to increase from 325,000 acres to a cap of 975,000 acres. Program changes provide more flexibility and help landowners work toward a goal of no net loss of wetlands. The program:
   - Requires that one-third of total program acres be enrolled in permanent easements,
     one-third in 30-year easements, and one-third in restoration only cost-share
     agreements. 
   - Provides landowners with 75-100 percent cost-sharing for permanent easements, 
     50-75 percent for 30-year easements, and 50-75 percent for restoration cost-share
     agreements. Cost-sharing will help pay for restoration. 
Farmland Protection Program
The Farmland Protection Program (FPP) is a new program under which the Secretary will join with state or local governments to purchase conservation easements. FPP is authorized to spend up to $35 million to protect between 170,000 and 340,000 acres of farmland that are already pending an offer from a state or local farmland conservation program.

ENVIRONMENTAL PROGRAMS

Wetland Conservation (Swampbuster)
The 1996 farm bill makes several changes to existing Swampbuster provisions to give farmers more flexibility in complying with wetland conservation requirements while protecting natural resources:
   - Expands areas where mitigation can be used. This allows individuals to work
     with producers, conservation districts or other relevant entities to select the best
     area for mitigating wetlands. 
   - Encourages effective and timely use of "minimal effect" determinations. This
     change allows the Natural Resources Conservation Service (NRCS), working
     with state technical committees, to identify practices that have a minimal
     effect on the environment and put them on a "fast track." 
   - Stipulates that wetland conversion activities, authorized by a permit issued
     under Section 404 of the Clean Water Act, which make agriculture production
     possible, will be accepted for farm bill purposes if they were adequately
     mitigated. 
   - Revises the concept of "abandonment" to ensure that as long as land is used
     for agriculture, a certified Prior Converted cropland designation remains in effect. 
     When done under an approved plan, landowners with Farmed Wetlands (FW) and
     Farmed Wetlands Pasture (FWP) may allow an area to revert to wetland status, and
     convert it back to an FW or FWP for agricultural purposes without violating
     the Swampbuster provision. 
   - Establishes a pilot program for wetland mitigation banking in order to allow
     USDA to assess how well mitigation banking works for agriculture. 
   - Expands the definition of agricultural land to include not only cropland and
     pasture land, but also tree farms, rangeland, native pasture land, and
     other land used for livestock production.
Wildlife Habitat Incentives Program
This new provision will help landowners improve wildlife habitat on private lands. The program will have $50 million in CRP funds for wildlife habitat improvement.
   - Provides cost-sharing to landowners for developing habitat for upland wildlife,
     wetland wildlife, endangered species, fisheries and other wildlife. 

   - Provides for consulting with state technical committees to set priorities
     for cost-share measures and habitat development projects. 
Bypass Flows on Forest Service Lands
A task force will be appointed to study the issue of bypass flows and related water rights on national forest land. There will be an 18-month moratorium on bypass flow requirements during the renewal of Forest Service permits for water supply facilities.

CONSERVATION PROGRAMS

Highly Erodible Land Conservation (Conservation Compliance)
Soil conservation compliance has been required since 1985 in order to qualify for farm subsidies. FAIR continued this requirement but made many changes to promote greater flexibility. FAIR authorizes county committees to provide relief in cases of undue economic hardship and ensures that penalties are commensurate with violations. Changes include:
   - A provision that USDA employees notify producers about deficiencies in
     conservation compliance within 45 days of the possible violation.  Appropriate
     action may be taken if the problem is not corrected within 1 year. 
   - A provision for expedited procedures for granting temporary variances.
   - Encouraging producers to obtain and maintain records of residue measurement.
     These measurements may be used by NRCS, as appropriate, in determining the level
     of annual erosion when conducting annual status reviews. 
   - Establishment of a highly erodible land wind erosion estimation pilot program
     to review, and modify as necessary, the use of the wind erosion factors used
     under the highly erodible land provisions to determine highly erodible land. 
   - Encouragement of on-farm research by providing the authority for the Secretary to
     include, on a field trial basis, practices that are not currently approved in the Field
     Office Technical Guide (FOTG) but are considered to have a reasonable likelihood
     of success. 
Conservation of Private Grazing Land
The grazing lands provision is a new program to ensure technical, educational, and related assistance is provided to landowners on the nation's 642 million acres of private grazing lands. In fiscal year 1996, $20 million is authorized. This amount increases to $60 million by the third year.

Conservation Research and Education
FAIR creates the National Natural Resources Conservation Foundation as a charitable nonprofit corporation to fund research and educational activities relating to conservation on private lands. The foundation will promote innovative solutions to conservation problems through public-private partnerships. It will also accept private gifts of money or property to be used for conservation activities. Congress has authorized $1 million annually from 1997-1999 for grants for research, education, and demonstration projects. Grants will also assist conservation districts in building resources to carry out local conservation programs.

State Technical Committees
State technical committees help develop technical standards for conservation programs. The farm bill requires public notice of meetings and expands committee membership to include representatives of non-government organizations such as agricultural producers, non-profit conservation organizations, agribusiness, and experts on the economic and environmental impacts of conservation techniques.

Conservation Farm Option
This is a pilot program for producers of wheat, feed grains, upland cotton, and rice who are eligible for Agriculture Market Transition Contracts. Under this program, landowners may consolidate their CRP, WRP, and EQIP payments into one annual payment. The participants enter into a 10-year contract and adopt a conservation farm plan approved by the Secretary. Initially, $7.5 million is authorized, increasing to $62.5 million in 2002. Total authorized funding is $197.5 million.

MISCELLANEOUS PROGRAMS

Many other programs related to conservation, natural resources and the environment were also passed in FAIR. These include: Agricultural Air Quality Research Oversight (a board on air quality); Everglades Ecosystem Restoration ($200 million for restoration); Fund for Rural America ($100 million per year for development, research, and other projects); Flood Risk Reduction (for farm land with high flood potential); and the Forestry Incentives Program.

Colorado State University, U.S. Department of Agriculture and Colorado counties cooperating.
Cooperative Extension programs are available to all without discrimination.
No endorsement of products is intended nor is criticism of products mentioned.

Notes Network...
(For More Information) Contact: Dana Hoag, Dept. of Ag. & Resource Economics, Colorado State University, Ft. Collins, CO 80523 - (970) 491-6325

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kclark@coop.ext.colostate.edu