Agricultural and Food Policy, Land Economics/Use,

Gray, Roy M.

English

Research Papers in Economics

Agricultural Outlook Forum 2002               Thursday, February 21, 2002 
 
A New Role for Conservation in U.S. Farm Policy 
 
Conservation Operations: USDA’s Challenge to Make it Work 
 
Remarks by 
Roy M. Gray 
Deputy Undersecretary for Natural Resources and the Environment 
U.S. Department of Agriculture 
 
Summary of Major Points 
•  We will need to see what the conference will finally do before we can determine the 
full challenge for USDA and NRCS 
•  Several things we are fairly certain will happen 
o More funding for conservation  
o Broaden the purposes, programs, and practices for conservation 
•  Challenges include 
o Streamline the process to make it work simply and smoothly to extent 
possible 
o Get technical information and reference materials out and available to the 
public and other providers of assistance 
o Work with third party vendors so that they can get certified and assist 
producers 
o Do what is reasonable and effective on the landscape   
•  Our desires and intentions 
o We want to make this work and will do our best to make it work 
o We recognize the uncertainties in some areas 
o We at USDA will do our level best to make it as fair as possible  
 
 
Part I --Likely directions for conservation in this Farm Bill 
 
We will have to see what will come out from the conference.  However, several things 
are likely. 
 
More Dollars 
•  Much greater funding for CCC conservation programs 
o About $400 million in FY 2001 for CCC conservation programs (EQIP, 
WHIP, FPP, WRP)  
  EQIP -- $199.9 
  WHIP -- $12.5 
  FPP -- $17.5 
  WRP -- $174.3 
o House and Senate bills range from $1.2 to $2.4 billion annually over 
FY2002 through FY 2006 o See following table  
o Considerable interest among the constituency groups and capital hill on 
increased role and funding for conservation of private lands.  In new 
budget authority the present legislative proposals for conservation range 
from 19 to 26 percent of the total dollars in additional budget authority for 
all titles of the bill.  This is a far larger share than the modest share for 
conservation among the CCC authority in the 1996 farm bill.   
•  Timeline for conservation dollars 
o See graphic for EQIP funding 
 
A broaden of conservation  
•  Purposes— 
o In 1985, most of the emphasis was on soil erosion and some on wetlands 
[CRP, HEL, wetlands] 
o In 1990, expanded on earlier purposes and placed much more emphasis on 
water quality. 
o Continued in 1996 with water quality, consolidated incentive programs 
into EQIP, and included more on wildlife habitat. 
o In current farm bill, both the House and Senate added air quality as an 
explicit purpose for EQIP.  
o Also institutionalized the farmland protection work started in 1996 and 
provided more resources for wildlife habitat. 
o Some allowance for bioenergy/biomass and addressing carbon 
sequestration.     
•  Programs  (largely Senate bill) 
o Conservation Security Program 
o Innovative Conservation Grant Program (within EQIP) 
o Pilot Program (Nutrient reduction in Chesapeake Bay) (within EQIP) 
o Water benefits program 
o Bioenergy and biomass (Energy Title) 
o Greenhouse gases and improved methods to measure or gauge 
sequestration potentials (Energy Title) 
•  Practices  
o Added “innovative practices” and opportunities for on-farm research and 
demonstration of practices in the conservation security program. 
o An explicit push for revision and expansion of practice standards to 
include measurable goals for enhancing natural resources, including 
innovative practices.   
o Innovative practices are explicitly included.  These include both actual 
practices as well as innovative approaches, like market based trading 
systems and means of leveraging.   
 
Part II -- Challenges for USDA and NRCS 
 
This farm bill also represents challenges and opportunities for USDA in carrying out our 
role in conservation.  
Streamline the process to make it work simply and smoothly to the 
maximum extent possible 
 
•  We will need to design the process to avoid delays and excessive transactions costs 
•  Paperwork to minimum, with still satisfying legal requirements 
•  May require first come first serve  
 
Dissemination (distribution) of technical information and reference 
material  
•  Providing and disseminating technical information 
o A growing need, as well as capability, to disseminate important 
conservation technical information via CD-ROM, the World Wide Web, 
and other media.   This would include soils information and maps, practice 
standards, economic costs, and related factual material.   
o Information on practice effects, both on farm and watershed or other 
delineation of area 
o We in USDA will need to do this to meet the needs of our own people, as 
well as a potentially large group of other providers of technical assistance, 
and the many farmers and ranchers that want our technical information 
themselves in order to sort out what is best for their operation.   
•  Improving our technical information 
o Challenge to expand technical information to include “new or innovative” 
practices and appropriate standards in the Field Office Technical Guide 
•  Bills require revision of practice standards (Sec IV) 
•  While not legal requirement, good opportunity to update technical 
information in the FOTG where needed to better serve clientele 
•  Good opportunity to work with land grant universities and others 
with solid factual information that can address conservation on the 
landscape 
o Developing technical guidance, such as conditions where and how wind 
turbines may be used on lands enrolled in CRP without compromising the 
environmental protection on these acres.   
 
Work with the private sector and third party providers of technical 
assistance 
•  Both the House and Senate bills include provisions for engaging third party providers 
for technical assistance to farmers and ranchers 
•  Certification requirements and training for third party vendors   
o Not new.  Has been in place (Producer bears payment responsibility) 
o Expanded opportunity for some vendors  (payment possibility)   
o Sometimes a very narrow slice of the overall mix  (e.g. soil testing is only 
one component of nutrient management) •  Much greater involvement with the private sector and the conservation partnership in 
carrying out conservation in the next decade and beyond.  These are challenges that 
we will deal with to insure that it is effective. 
o Example – seeding of certain native species of grass for CRP cover caused 
shortages and substantial increase in price.  We want to avoid that where 
possible as we implement the new conservation provisions where we can 
legitimately coordinate with the private sector. 
 
Conservation systems that are reasonable and effective on the landscape 
•  In EQIP, the systems to be applied need to address the needs and concerns of farmers 
and ranchers for their land.  Some may be more innovative, but that is the producer’s 
choice.   
•  Practices need to be effective.  Standards need to be met.   
•  Ultimately, USDA and NRCS will also need to be accountable for the systems 
applied and for the public monies spent. 
 
Part III -- Our desires and intentions 
 
In closing, there are three points to acknowledge 
1.  We at USDA want to make the conservation effort work and we will be doing our 
best to make that happen  
2.  While there are uncertainties and difficulties that we will encounter in this 
process, we will strive our best to address those directly and professionally 
3.  We want to insure fairness in the whole process, so that farmers and ranchers will 
feel that they have been served fairly.  Maybe some producers may not get as 
much as they would like, but they should certainly get what they are entitled to 
with fairness.   
 
Thank you Conservation Title Budget Authority   1  /
Note that this table is based on Legislative language and is separated into dollar and acre authorities
PROGRAM DOLLAR Authority ($ Million) * Ten Year
FIVE YEAR Five year Calculated
2002 2003 2004 2005 2006 TOTAL 2007 2008 2009 2010 2011 Total Total
Environmental Quality Incentives Program
HR 2646 $1,025 $1,025 $1,200 $1,200 $1,200 $5,650 $1,400 $1,400 $1,400 $1,500 $1,500 $7,200 $12,850
S 1731 $500 $1,300 $1,450 $1,450 $1,500 $6,200 $850 $850 $850 $850 $850 $4,250 $10,450
Farmland Protection Program
HR 2646 $50 $50 $50 $50 $50 $250 $50 $50 $50 $50 $50 $250 $500
S 1731 $150 $250 $400 $450 $500 $1,750 $100 $100 $100 $100 $100 $500 $2,250
Wildlife Habitat Incentives Program
HR 2646 $25 $30 $30 $35 $35 $155 $40 $45 $45 $50 $50 $230 $385
S 1731 $50 $225 $275 $325 $355 $1,230 $50 $50 $50 $50 $50 $250 $1,480
Conservation Security Program  2  /
HR 2646 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
S 1731 $0 $11 $46 $114 $216 $387 $359 $516 $674 $820 $946 $3,315 $3,702
Water Benefits Program
HR 2646 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
S 1731 $25 $52 $100 $100 $100 $377 $100 $100 $100 $100 $100 $500 $877
TOTAL Authorized Dollars for Listed Programs
HR 2646 $1,100 $1,105 $1,280 $1,285 $1,285 $6,055 $1,490 $1,495 $1,495 $1,600 $1,600 $7,680 $13,735
S 1731 $725 $1,838 $2,271 $2,439 $2,671 $9,944 $1,459 $1,616 $1,774 $1,920 $2,046 $8,815 $18,759
*  Program authority does not represent estimated outlays or "scoring"
PROGRAM ACREAGE Authority Total of **  Out year funding is assumed at amount of last year authorized.    Only 
Wetlands Reserve Program annual additions (1000 Acres) 3  / additions H.R. 2646 includes authorization to FY 2011.  S.1731 includes $ for FY 2007
HR 2646 150 150 150 150 150 750 for selected programs, but does not extend authority beyond FY 2006.
S 1731 250 250 250 250 250 1250 Notes:
1/  Based on authority provided in legislative language as follows:
Grassland Reserve Program ceiling (Million Acres) Cap     HR 2646 as passed by House on October 5, 2001
HR 2646  4  / 2.0     S.1731 as passed the Senate on February 13, 2002
S 1731 2.0 2/  Uses CBO outlay estimates rather than budget authority
3/  WRP in House has annual additions and does not have overall cap. 
Conservation Reserve Program ceiling (Million Acres Cap    Senate has new cap of 2,225,000 acres as well as annual additions.
HR 2646 39.2 4/  H.R. 2646 includes aggregate of $254 million for Grassland Reserve over full term.
S 1731 40.0
Authorized or Assumed Funding for Out Years ** Program Funding by Fiscal Year
 
 
 
 
 EQIP Funding under S.1731and HR2646
Senate Bill 2/13/02 and House Bill 10/5/01
0
200
400
600
800
1000
1200
1400
1600
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
Fiscal Year
(Senate bill is 2002 through 2006 with 2007 $ amount specified.  House bill is through 2011)
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A NEW ROLE FOR CONSERVATION IN U.S. FARM POLICY, CONSERVATION OPERATIONS: USDA'S CHALLENGE TO MAKE IT WORK

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