As discussion and planning begin for the upcoming 2023 Farm Bill, it can be helpful to review the current programs in place under the previous farm bill. The 2018 Farm Bill expanded conservation programs, which made up 7% of the bill’s total projected mandatory spending.
Conservation programs will likely be a big topic again in the upcoming farm bill. Industry groups have stressed the importance of and need for voluntary, incentive-based conservation programs.
In a recent Market Intel report, American Farm Bureau economist Shelby Myers reviewed the current Title II conservation programs in the farm bill.
“First incorporated into a farm bill in 1985, the conservation title is what some would consider the original Green New Deal,” Myers said. “Its voluntary conservation initiatives give farmers and ranchers flexibility to adopt practices in a market-based approach.”
The three main programs in the conservation title cover working lands and retirement initiatives, with the largest land retirement program, the Conservation Reserve Program (CRP), and the two largest working lands programs, the Environmental Quality Incentives Program (EQIP) and the Conservation Stewardship Program (CSP).
Outlays for CRP are close to $2 billion per fiscal year, while EQIP and CSP see a combined dedicated $25 billion over 10 years. Funding for CSP shifted from an acreage limitation to limits based on funding, and EQIP was expanded and reauthorized with increased funding levels.
CRP
Through CRP, the government and a producer enter an agreement for land to be taken out of agricultural production for 10-15 years. A large majority of contracts enroll whole fields or farms, but there has been a recent increased interest in enrolling high-priority, partial field practices like filter strips and grass waterways, Myers said.
CRP provides compensation via a cash rental rate that is based on the relative productivity of soils within each county.
There are four other land retirement programs available that lands may be enrolled in, in addition to CRP, which are the Conservation Reserve Enhancement Program, Farmable Wetlands Program, CLEAR30 and the piloted Soil Health Income Protection Program.
There was a “stepdown” policy for the acreage cap allowed in CRP in the 2014 Farm Bill, but the policy was reverted to a “step up” policy in the 2018 Farm Bill. The acreage cap moved from 24 million acres in fiscal year 2019, to 27 million acres by fiscal year 2023. Although enrollment limits have increased, actual acreage enrolled has decreased. Until recently, the total number of acres enrolled in CRP has declined every year since 2007, Myers said.
In 2021, USDA reopened CRP enrollment to add up to 4 million new acres to the program using a 3, 5 or 10% climate-smart incentive payment in addition to the standard CRP payment. In 2022, USDA allowed producers to voluntarily terminate a CRP contract in its final year to give producers the flexibility to mitigate food supply challenges.
The 2018 Farm Bill limited CRP rental rates for general enrollment to 85% of the county average rental rate, while continuous enrollment rates were limited to 90% of the county average rental rate.
EQIP
Working lands programs were introduced in the 2002 Farm Bill as a way to complement programs promoting conservation stewardship without taking away production, Myers said. These programs provide financial and technical assistance for implementing conservation practices.
EQIP is a voluntary program with a requirement that 50% of funds go to livestock-based projects. Producers enter into contracts to receive payment for implementing approved conservation practices, of which there are hundreds. The most widely used practices include cover cropping, nutrient management, irrigation water management, prescribed grazing, fencing and forest stand improvements. Contracts last from five to 10 years, with a $450,000 payment limitation.
Mandatory funding set in the 2018 Farm Bill increased from $1.75 billion in fiscal year 2019 to $2.025 billion by fiscal year 2023. The Inflation Reduction Act (IRA) included an additional $18.05 billion for working lands programs, bringing EQIP’s total appropriations to $8.45 billion through 2026.
There were 33,701 active and completed EQIP contracts across 10.5 million acres in the U.S. in 2020.
CSP
CSP provides financial and technical assistance to support ongoing and new conservation improvements. Participants must meet a “stewardship threshold” for a set number of priority resource concerns when they apply for the program and must agree to meet or exceed the stewardship threshold for additional priority resource concerns by the end of the contract, Myers said. Contracts last up to 10 years.
The 2018 Farm Bill limited funding for each fiscal year, rather than the amount of acres enrolled. Mandatory funding was $700 million for fiscal year 2019 and increased to $1 billion in fiscal year 2023. The IRA included an additional $3.25 billion for CSP through 2026.
There were 4,922 active CSP contracts across more than 6.4 million acres in the U.S. in 2020.
“There continues to be questions about whether or not the added IRA funds contribute to added baseline dollars for the 2023 farm bill,” Myers wrote. “Until those questions are answered, the current expectation is that Congress has provided more to over-subscribed working lands programs, rather than land retirement programs, with more technical assistance on voluntary incentives to help producers meet their conservation and sustainability goals.”
It remains to be seen what adjustments will be made regarding conservation programs for the 2023 Farm Bill. — Anna Miller, WLJ managing editor
