SPEAKERS CONTENTS INSERTS
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00–000 DTP
2001
2001
FORMULATION OF THE 2002 FARM BILL
(CONSERVATION PROGRAMS, CREDIT, RURAL DEVELOPMENT, AND RESEARCH)
HEARINGS
BEFORE THE
SUBCOMMITTEE ON CONSERVATION, CREDIT,
RURAL DEVELOPMENT, AND RESEARCH
OF THE
COMMITTEE ON AGRICULTURE
HOUSE OF REPRESENTATIVES
ONE HUNDRED SEVENTH CONGRESS
FIRST SESSION
MAY 23, JUNE 6, 9, WEATHERFORD, OK; 20, 26, 27, 2001
Serial No. 107–10
Part 1
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Printed for the use of the Committee on Agriculture
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COMMITTEE ON AGRICULTURE
LARRY COMBEST, Texas, Chairman
JOHN A. BOEHNER, Ohio
Vice Chairman
BOB GOODLATTE, Virginia
RICHARD W. POMBO, California
NICK SMITH, Michigan
TERRY EVERETT, Alabama
FRANK D. LUCAS, Oklahoma
SAXBY CHAMBLISS, Georgia
JERRY MORAN, Kansas
BOB SCHAFFER, Colorado
JOHN R. THUNE, South Dakota
WILLIAM L. JENKINS, Tennessee
JOHN COOKSEY, Louisiana
GIL GUTKNECHT, Minnesota
BOB RILEY, Alabama
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MICHAEL K. SIMPSON, Idaho
DOUG OSE, California
ROBIN HAYES, North Carolina
ERNIE FLETCHER, Kentucky
CHARLES W. ''CHIP'' PICKERING, Mississippi
TIMOTHY V. JOHNSON, Illinois
TOM OSBORNE, Nebraska
MIKE PENCE, Indiana
DENNIS R. REHBERG, Montana
SAM GRAVES, Missouri
ADAM H. PUTNAM, Florida
MARK R. KENNEDY, Minnesota
CHARLES W. STENHOLM, Texas,
Ranking Minority Member
GARY A. CONDIT, California
COLLIN C. PETERSON, Minnesota
CALVIN M. DOOLEY, California
EVA M. CLAYTON, North Carolina
EARL F. HILLIARD, Alabama
TIM HOLDEN, Pennsylvania
SANFORD D. BISHOP, Jr., Georgia
BENNIE G. THOMPSON, Mississippi
JOHN ELIAS BALDACCI, Maine
MARION BERRY, Arkansas
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MIKE McINTYRE, North Carolina
BOB ETHERIDGE, North Carolina
LEONARD L. BOSWELL, Iowa
DAVID D. PHELPS, Illinois
KEN LUCAS, Kentucky
MIKE THOMPSON, California
BARON P. HILL, Indiana
JOE BACA, California
RICK LARSEN, Washington
MIKE ROSS, Arkansas
ANÍBAL ACEVEDO-VILÁ, Puerto Rico
RON KIND, Wisconsin
RONNIE SHOWS, Mississippi
Professional Staff
WILLIAM E. O'CONNER, JR., Staff Director
LANCE KOTSCHWAR, Chief Counsel
STEPHEN HATERIUS, Minority Staff Director
KEITH WILLIAMS, Communications Director
Subcommittee on Conservation, Credit, Rural Development, and Research
FRANK D. LUCAS, Oklahoma, Chairman
JERRY MORAN, Kansas
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Vice Chairman
JOHN R. THUNE, South Dakota
DOUG OSE, California
TOM OSBORNE, Nebraska
SAM GRAVES, Missouri
ADAM K. PUTNAM, Florida
MARK R. KENNEDY, Minnesota
EARL F. HILLIARD
Ranking Minority Member
JOHN ELIAS BALDACCI, Maine
DAVID PHELPS, Illinois
MIKE THOMPSON, California
JOE BACA, California
COLLIN C. PETERSON, Minnesota
EVA M. CLAYTON, North Carolina
(ii)
RYAN E. WESTON, Subcommittee Staff Director
C O N T E N T S
MAY 23, 2001
Hilliard, Hon. Earl F., a Representative in Congress from the State of Alabama, opening statement
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Kind, Hon. Ron, a Representative in Congress from the State of Wisconsin, prepared statement
Lucas, Hon. Frank D., a Representative in Congress from the State of Oklahoma, opening statement
Moran, Hon. Jerry, a Representative in Congress from the State of Kansas, prepared statement
Putnam, Hon. Adam H., a Representative in Congress from the State of Florida, prepared statement
Stenholm, Hon. Charles W., a Representative in Congress from the State of Texas, prepared statement
Witnesses
Horan, Bill, president, Iowa Corn Growers Association
Prepared statement
Lincoln, John, president, New York Farm Bureau
Prepared statement
Stephenson, Robert, Director, Conservation and Environmental Programs, Farm Service Agency, U.S. Department of Agriculture
Weber, Thomas, Deputy Chief, Programs, Natural Resources Conservation Service, U.S. Department of Agriculture
Prepared statement
Answers to submitted questions
Willey, Wythe, president-elect, National Cattlemen's Beef Association
Submitted Material
National Pork Producers, statement
Tallman, Dusty, president, National Association of Wheat Growers, statement
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JUNE 6, 2001
Boehlert, Hon. Sherwood L., a Representative in Congress from the State of New York, submitted statement
Hilliard, Hon. Earl F., a Representative in Congress from the State of Alabama, prepared statement
Lucas, Hon. Frank D., a Representative in Congress from the State of Oklahoma, opening statement
Witnesses
Adams, Jamie Clover, secretary, Kansas Department of Agriculture, Topeka, KS; on behalf of the National Association of State Departments of Agriculture
Prepared statement
Cantu, Joe, president, National Association of Resource Conservation & Development Councils, Pipe Creek, TX
Prepared statement
Cox, Craig, executive vice-president, Soil and Water Conservation Society, Ankeny, IA
Prepared statement
Grossi, Ralph, president, American Farmland Trust, Washington, DC, on behalf of the Coalition of Conservation and Environmental Organizations
Prepared statement
Hampton, Joe, president, Oklahoma Grain and Feed Association, Enid, OK, on behalf of the National Grain and Feed Association
Prepared statement
Nelson, Jeff, director of operations, Great Plains Regional Office, Ducks Unlimited Inc., Bismarck, ND, on behalf of the Sportsman Coalition
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Prepared statement
Peterson, R. Max, executive vice-president, International Association of Fish and Wildlife Agencies, Washington, DC
Prepared statement
Smith, J. Read, president, National Association of Conservation Districts, St. John, WA
Prepared statement
Submitted Material
Defenders of Wildlife, statement
Environmental Working Group, statement
Native Seed Trade Association, statement
Stawick, David, Alliance for Agricultural Conservation, statement
Wildlife Management Institute, statement
JUNE 9, 2001, Weatherford, OK
Lucas, Hon. Frank D., a Representative in Congress from the State of Oklahoma, opening statement
Moran, Hon. Jerry, a Representative in Congress from the State of Kansas, opening statement
Osborne, Hon. Tom, a Representative in Congress from the State of Nebraska, opening statement
Witnesses
Bowman, Eddie, president, Oklahoma Wheat Growers
Prepared statement
Conner, Richard, professor, range economics, Texas A&M University, on behalf of the Nature Conservancy
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Prepared statement
Dewald, Scott, Oklahoma Cattlemens Association
Prepared statement
Drake, Bob, Grazing Lands Conservation Initiative
Prepared statement
Kouplen, Steve, president, Oklahoma Farm Bureau
Prepared statement
Limmer, Dan, director, South Dakota Audobon Society
Prepared statement
Lowrance, Dan, vice-president, Oklahoma Association of Conservation Districts
Prepared statement
Miller, Alfred, president, Oklahoma, Association of Resource Conservation and Development Councils
Wilson, Billy, past chairman, National Watershed Coalition
Prepared statement
Wulf, Ray, president, Oklahoma Farmers Union
Prepared statement
Submitted Material
National Governors Association, statement
JUNE 20, 2001
Lucas, Hon. Frank D., a Representative in Congress from the State of Oklahoma, opening statement
Witnesses
Cooksie, Carolyn B., Deputy Administrator, Farm Loan Programs, Farm Service Agency, U.S. Department of Agriculture
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Prepared statement
Edelman, Henry D., president and chief executive officer, Federal Agricultural Mortgage Corporation
Prepared statement
Hague, Terry, chief executive officer, Farmers Exchange Bank, representing the American Bankers Association
Leighty, Dale, president, First National Bank of Las Animas, representing the Independent Community Bankers of America
Prepared statement
Answers to submitted questions
Lowrey, F.A., president and chief executive officer, AgFirst Farm Credit Bank, representing the Farm Credit Council
Prepared statement
Robinson, Miles, college of agricultural, environmental and natural sciences, Tuskegee University
Prepared statement
JUNE 26, 2001
Hilliard, Hon. Earl F., a Representative in Congress from the State of Alabama, opening statement
Lucas, Hon. Frank D., a Representative in Congress from the State of Oklahoma, opening statement
Witnesses
Dudick, Joe, executive director, Partners for Rural America
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Prepared statement
English, Hon. Glenn, chief executive officer, National Rural Electric Cooperative Association
Prepared statement
Fluharty, Charles W., director, Rural Policy Research Institute, Columbia, MO
Prepared statement
Gorshing, Gary, executive director, South Western Oklahoma Development Authority, on behalf of the National Association of Development Organizations and National Association of Counties
Prepared statement
Graves, David, president and chief executive officer, National Council of Farmer Cooperatives
Prepared statement
Hoeven, Hon. John, Governor, State of North Dakota, on behalf of the National Governors Association
Prepared statement
Stockton, Blaine, Acting Administrator, Rural Utilities Service, U.S. Department of Agriculture
Prepared statement
Zippert, John, director, program operations, Federation of Southern Cooperatives
Prepared statement
Submitted Material
Herrera, Hank, Community Food Service Coalition, statement
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Leval, Kim Center for Rural Affairs, statement
Regional Rural Development Center, statement
Swenson, Leland, president, National Farmers Union, statement
JUNE 27, 2001
Combest, Hon. Larry, a Representative in Congress from the State of Texas, opening statement
Lucas, Hon. Frank D., a Representative in Congress from the State of Oklahoma, opening statement
Putnam, Hon. Adam H., a Representative in Congress from the State of Florida, prepared statement
Witnesses
Abernathy, John R., dean, College of Agricultural Sciences and Natural Resources, Texas Tech University, Lubbock, TX
Prepared statement
Curl, Sam, dean and director, Division of Agricultural Sciences and Natural Resources, Oklahoma State University, Stillwater, OK
Prepared statement
Hefferan, Colien, Administrator, Cooperative State Research, Extension, Education Service, U.S. Department of Agriculture,
Prepared statement
Floyd Horn, Floyd, Administrator, Agricultural Research Service, U.S. Department of Agriculture
Prepared statement
Lechtenberg, Victor, L., chair, National Agricultural Research, Extension, Education and Economics Advisory Board, West Lafayette, IN
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Prepared statement
Phills, Bobby, dean, School of Agriculture, Florida A&M University, Tallahassee, FL
Prepared statement
Wolf, Terry, president, National Coalition for Food and Agricultural Research, Homer, IL
Prepared statement
Submitted Material
American Dietetic Association, statement
American Indian Higher Education Consortium, statement
Barcinas, Jeff D.T., statement
Cosgrove, Daniel, American Society of Plant Physiologists, statement
FORMULATION OF THE 2002 FARM BILL
(CONSERVATION PROGRAMS)
WEDNESDAY, MAY 23, 2001
House of Representatives,
Subcommittee on Conservation, Credit,
Rural Development and Research,
Committee on Agriculture,
Washington, DC.
The subcommittee met, pursuant to call, at 3:42 p.m., in room 1300 of the Longworth House Office Building, Hon. Frank D. Lucas (chairman of the subcommittee) presiding.
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Present: Representatives: Moran, Thune, Osborne, Putnam, Kennedy, Hilliard, Phelps, Peterson, and Stenholm [ex officio].
Also present: Representative Kind.
Staff present: Ryan Weston, subcommittee staff director; Dave Ebersole, Anne Simmons, John Riley, and Susanna Love, assistant clerk.
OPENING STATEMENT OF HON. FRANK D. LUCAS, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF OKLAHOMA
Mr. LUCAS of Oklahoma. This hearing of the Subcommittee on Conservation, Credit, Rural Development and Research to review conversation issues will come to order.
I want to welcome the subcommittee's first of these three hearings to discuss conservation issues that must be addressed in next year's farm bill.
In the previous hearings, we have heard and learned how efficient conservation minded agricultural producers have become regarding energy. Agricultural producers are amazing caretakers of the land, as they are the original conservationists. Since the land provides them with a living year after year, who has more vested interest in taking care of it? I would dare say none.
This subcommittee has been tasked with determining what conservation measures are needed in the next farm bill. We do not intend to take the responsibility lightly. We have heard groups testify that between $6 billion and $12 billion per year may be required for commodity programs to provide an adequate safety net to producers. We are also going to hear organizations request between $3 to $8 billion per year for conservation programs. It does not take an economics degree to see that the requests for these two farm bill titles alone add up to large, and I mean large, amounts of money. Before we decide the money will solve our conservation concerns, we must diligently examine what we are doing now.
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First, we must review the current programs. Are they meeting the goals they were intended to reach?
Second, we must review the persons and organizations that are responsible for these programs. Are they administering the programs in an efficient and effective fashion?
Third, producers are faced with an array of regulation and conservation priorities. Do the current programs help producers comply with current regulations and will they help producers meet their future regulatory burdens in order to allow U.S. producers to remain among the most environmentally friendly in the world?
Our subcommittee members will decide how dollars can best be spent on conservation, whether it is cost-share programs, technical assistance, watershed programs or rental and easement programs or a combination of some or all of these to be determined. We will work with agricultural producer groups, sporting groups, conservation groups, agribusinesses and other interested parties to find a consensus that is feasible and responsible.
I thank you for being here. I look forward to your testimony. I apologize for the delay. But our first responsibility, as some of you have heard me say before as Members of Congress, is to cast those votes on the floor of the United States House, and that is where we have been for an hour and a half. With that apology, hopefully duly noted, I turn to my ranking member, Mr. Hilliard, for his opening comments.
OPENING STATEMENT OF HON. EARL F. HILLIARD, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF ALABAMA
Mr. HILLIARD. Thank you very much, Mr. Chairman.
Mr. Chairman, members and distinguished guests, I am delighted that Mr. Combest and Mr. Stenholm have decided to write a farm bill this year. There's no question it is needed. We need to get on with the task of helping our farmers and American people.
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Conditions have changed since the last farm bill has been written. And many contradictions have developed, as things will over a period of time. Changes take place and we need to help direct those changes to constructive ends.
I strongly support public-private corporation that is the very basis of our farm policy. Before World War II, our government was supporting several times more strongly farmers than it is now. Further, the interplay of productive farming and environmental protection and management make for an intelligent, long lasting agriculture section in our Nation. Managing this interplay is the purpose of the farm bill. We must deal with urgent matters now. We cannot wait any longer.
I want to mention one serious problem that I find to exist in our conservation program. Our small, some underprivileged and some disadvantaged farmers, seldom participate in those type programs. And they are the ones who need them the most. I do not know all of the reasons for this, but I hope that the witnesses today will respond to that problem and suggest ways to remedy it. We have lost a great deal of the diversity in farming over the years. We have lost a large number of small farmers. This has been damaging to our society in a number of ways. We cannot afford to continue to lose small farmers on the rate that we have in the past. We displace and impoverish families that destroy the rural infrastructure of our Nation. We cannot afford to let this happen any longer. Again, let me say I support constructive conservation programs, but I think that they need to be made to work for rural people and to farmers. Thank you and thank you, Mr. Chairman, for this meeting.
Mr. LUCAS of Oklahoma. Thank you Mr. Hilliard for your comments. Does the ranking member of the full committee, Mr. Stenholm, have any comments he wishes to make?
Mr. STENHOLM. I just have a statement to be inserted into the record, Mr. Chairman. Thank you.
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[The prepared statement of Mr. Stenholm follows:]
PREPARED STATEMENT OF HON. CHARLES W. STENHOLM, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF TEXAS
I appreciate Chairman Lucas and Ranking Member Hilliard holding today's hearing, and those that will follow, to review the conservation programs that fall under the jurisdiction of the House Committee on Agriculture.
I have repeatedly said that we are falling behind in our commitment to helping landowners and operators protect, preserve and enhance their farms and ranches. If we compare the spending on technical and financial assistance on working lands to what we did in 1937, we'd be spending over $5 billion a year, instead of the $1 billion that we're spending today.
This subcommittee has a very difficult task before it, and I hope that the Members will consider several questions as they hear from witnesses and discuss possible actions:
How do we balance the financial assistance that is provided to working lands versus acreage that has been retired from production?
Are priority areas accomplishing their objective of concentrating financial and technical efforts and making a difference in environmental quality, or is there a need to spread our financial resources throughout the countryside, which can also provide needed conservation benefits?
Can the objectives presented by the various groups and constituencies be achieved through our current programs, or do we need to take a different path?
As I indicated earlier, this subcommittee will have some very difficult choices to make. I wish them well in this endeavor, and I look forward to working with them as they strive to complete their task.
Mr. LUCAS of Oklahoma. Thank you, Mr. Stenholm.
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The Chair would request that other members submit their opening statements for the record so that the witnesses may begin their testimony and to ensure that we have ample time for questions.
[The prepared statements of Members follows:]
PREPARED STATEMENT OF HON. JERRY MORAN, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF KANSAS
Mr. Chairman, I appreciate the subcommittee scheduling a hearing on this issue that is so important to landowners and conservationists, but particularly to our agricultural producers. Conservation and protecting the environment will be major goals of the next farm bill.
Farmers and ranchers are the greatest stewards of our natural resources. Through their daily efforts to supply American consumers with food and fiber, they directly and indirectly take steps to protect the quality of our water and air, maintain wildlife habitat, and preserve the land for future generations.
This year's farm bill has been predicted to be the ''greenest'' farm bill ever, strongly emphasizing conservation incentives. The task at hand is to help producers meet today's current environmental regulations, as well as to help them satisfy the environmental criteria of the future. We must address the existing conservation needs of agricultural producers, while also keeping in mind the future challenges that these operations could face. New Confined Animal Feeding Operation regulations from the Environmental Protection Agency, compliance with Total Maximum Daily Loads, and preserving critical habitat for wildlife are just a few of the problems producers see on the horizon.
I believe that existing conservation programs can be used as a basis to effectively address today's problems. The Conservation Reserve Program, Wetlands Reserve Program), Environmental Quality Incentives Program, and Wildlife Habitat Improvement Program offer producers a variety of conservation tools and resource management options. With some changes in the current administration of these programs and targeted expansion to address pending concerns, we can continue to support producers in meeting environmental goals.
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Perhaps one of the greatest needs for conservation assistance occurs on lands used in production for both crops and livestock. In the past, we have addressed resource conservation by simply setting land aside. However, conservation practices can be effective without taking ground out of production. Best Management Practices for row crops are just one example of a mutually beneficial land use that is good for the environment and good for farm income. These types of management practices should be eligible for incentives to encourage widespread use of conservation initiatives.
To address the increased public demand for and producer interest in conservation, the conservation budget for agriculture has been increased by at least $3.5 billion, with the possibility of additional spending to be considered by the agriculture committee. This increase is much-needed and welcomed by agriculture producers. However, as Chairman Combest pointed out last week, we are constrained by the total $79 billion budget increase. From this total increase must come not only conservation programs, but also programs for rural development, food and nutrition, commodity support, food safety, research, and other important Department of Agriculture functions. Therefore, it is important that conservation considerations fit within the budget realities.
The chairman has outlined the committee's intention to report a comprehensive farm bill before the August recess. This timeline sharpens our focus on the specifics of conservation options. As we begin the discussion of different approaches to conservation programs, I believe it is important to note that all the recommendations share the same end goal of providing conservation programs that work for producers and landowners and benefit the environment.
Yesterday I introduced the Conservation Enhancement Act to reauthorize four existing conservation programs, CRP, WRP, EQIP, and WHIP, for 10 years, through 2012. In addition to reauthorization, this bill provides greater flexibility to help producers address the environmental challenges confronting today's agriculture. The CEA builds on the positive results of current programs, while making the programs more useful for those who seek to participate and a better value for the taxpayer. The legislation fits budget goals for conservation spending.
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As the summer schedule progresses, I am optimistic that the conservation discussion can create a win-win situation for protecting the environment and helping the survival of family farms. I look forward to working together on behalf of our agriculture producers to address environmental issues through enhanced stewardship incentives like those outline in the CEA.
Again, Mr. Chairman, I thank you for the opportunity to have this hearing. Today's input is a good start to including conservation issues in farm bill debate.
PREPARED STATEMENT OF HON. ADAM H. PUTNAM, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF FLORIDA
Federal conservation programs play a critical role in sustaining a viable agricultural industry and the protection of valuable natural resources. Through voluntary participation of landowners in conservation initiatives, the task of managing natural resources and farm production becomes more attainable.
U.S. Department of Agriculture conservation programs are vital to the environmental restoration and protection of Florida's resources and agricultural lands. Implementation of conservation programs have brought improvements throughout Florida to the production of cow-calf operations, water quality and wildlife habitat demonstrating the healthy partnership between environmental preservation and agricultural production.
While Florida consistently ranks fifth in the Nation in net farm income with sales currently exceeding $8 billion for agriculture and its farmers and ranchers face some of the most extensive environmental challenges—Florida only received 2 percent of the Federal agricultural budget distributed through the Natural Resources Conservation Service (NRCS). It is critical that conservation programs are broadened and enhanced to allow greater access to farmers and ranchers representing a wide range of agricultural production across the Nation.
Specific improvements to current conservation programs include increasing enrollment in the Wetlands Reserve Program by an additional 250,000 acres; allowing the use of cattle grazing to control invasive plant species and expanding conservation practices for marginal pastureland to include isolated wetlands restoration in the Conservation Reserve Enhancement Program; expansion of the Environmental Quality Incentives Program (EQIP) to allow funding of Best Management Practices to address Total Daily Maximum Load (TMDL) requirements and Concentrated Animal Feeding Operations (CAFO). Development of flexible program guidelines that encourage landowner participation and allow funds to be used to address water quality issues is also critical.
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State NRCS funding levels should also more accurately reflect the proportional value of statewide agricultural production to the Nation and water quality needs. Flexibility must be woven into the program to allow maximum conservation results by allowing the blending of programs on a tract of land. Providing for up-front funding for smaller and limited resources farmers should encourage participation by smaller landowners. NRCS staffing demands could be relieved by the outsourcing of technical assistance and providing block grants to States and localities. Many of these tenants aimed at greater access and flexibility for American producers to conservation programs will be included in the Resource Conservation Agreement Act that I will be introducing soon.
Building improved conservation partnerships is critical to meeting resources management challenges. Expansion and enhancement of voluntary, incentive based conservation programs are to key to reaching these goals. I look forward to working with my Colleagues toward new and creative conservation incentive programs to protect natural resources and sustain a viable agricultural industry.
Additional Florida Conservation facts:
Florida ranks seventh in the Nation in total Wetlands Reserve Program acres. Nearly 10,765 acres of wetlands have been restored and protected under the program. The loss of 465,000 agricultural acres of urban expansion is major concern to Florida.
Recent conservation highlights in the State include a dramatic decrease in nitrate levels from animal wastes, protection of 10,764 acres of wetlands, an EQIP commitment of $3 million and technical assistance provided to 5,581 producers.
Mr. LUCAS of Oklahoma. I would like to invite our first panel to the table. Mr. Thomas Weber, Deputy Chief for Programs, Natural Resources Conservation Service, U.S. Department of Agriculture, and Mr. Robert Stephenson, Director of Conservation and Environmental Programs, Farm Service Agency, USDA.
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Mr. Weber, please begin when ready.
STATEMENT OF THOMAS WEBER, DEPUTY CHIEF, PROGRAMS, NATURAL RESORCES CONSERVATION SERVICE, U.S. DEPARTMENT OF AGRICULTURE
Mr. WEBER. Mr. Chairman and members of the committee, thank you for the opportunity to appear here today and provide an update on the conservation programs implemented by the Natural Resource Conservation Service.
Farmers want to be good stewards of the land. And our mission is to help them meet their conservation challenges, while maintaining productivity. The backlog of program requests is a testament to their interest.
Today, I want to highlight the many ways our conservation programs are making a difference. Our programs are voluntary and help farmers and ranchers deal with regulatory pressures. And the public benefits from these programs in terms of improved and protected natural resources.
In short, I believe the conservation programs are a win win for farmers and the Nation. But before I outline the programs, I want to say a word about the cornerstone of our work. The conservation technical assistance provided by the Natural Resources Conservation Service.
Everything we accomplish is contingent upon the talents and technical skills of our field staff around this country. They are trained professionals with technical tools, standards and specifications to get the job done on the land. And the partnership we have with the State and local people, including conservation districts, State conservation agencies and Resource Conservation and Development councils is important today, as it has ever been.
I want to also take a moment to emphasize that outside of the farm bill programs, the NRCS Small Watershed Program continues to serve America with flood prevention, water quality and water supply improvements and many other conservation benefits. The program remains very popular and continues to grow and produce excellent results around the country.
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Mr. Chairman, I want to commend you and other members of this subcommittee for your leadership on NRCS Water Resource Programs. Having said that, I will begin a review of the 1996 farm bill programs by highlighting another of our important water resource activities. The Wetland Reserve Program. WRP preserves, protects and restores wetlands. WRP is making a substantial contribution to the restoration of Nation's migratory bird habitat. A 1996 act authorized a total enrollment of 975,000 acres in the program. At the completion of fiscal year 2000, the program had almost reached maximum enrollment. However, the fiscal 2001 appropriations provided an additional 100,000 acres. We have several times as many acres offered than the program can enroll. It is clear WRP continues to be very popular with farmers and has strong support around the countryside.
Second, the Wildlife Habitat Incentive Program, which provides 75 percent of the cost-share for implementing wildlife habitat practices. The program had an initial funding cap of $50 million, which was exhausted at the end of fiscal year 1999, with 1.4 million acres enrolled. For fiscal year 2000, WHIP will be funded with an additional $12.5 million from funding in the Agricultural Risk Protection Act of 2000. We expect land owner interest in this program to greatly exceed funding.
Next, the Farmland Protection Program, which protects farmland from conversion to nonagricultural uses. It provides matching funds to acquire conservation easements. The program was initially funded at $35 million. These funds were exhausted in fiscal year 1998. For 2001, $17.5 million of additional funding was provided. Again, through the Agriculture Risk Protection Act of 2000. We have received $116 million in requests for this funding.
The Environmental Quality Incentives Program or EQIP, provides technical, financial and educational assistance to farmers and ranchers who face serious threats to soil, water and related natural resources. The 1996 act authorized funding at $200 million, however, funding has varied from $174 million to $200 million, annually. The program has been extremely successful. We continue to receive three to six times the number of applications that could be approved with funding. Demand for this program remains high around the country.
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Mr. Chairman, in closing, I would note that conservation does not just happen. It happens because all of us, including the Congress, the conservation partners and most importantly, the people living on the land work together to make it happen. As exemplified through the many programs and activities that are underway, a great deal is happening on the ground. As a result, we are all enjoying the public benefits of an improved quality of life, affordable and safe food supply, clean air and water, reduced damage from floods and other natural disasters, abundant fish and wildlife, scenic landscapes and a sustainable resource base. These benefits are critical to sustain agricultural production, economic prosperity and the very social fabric of our communities now and in the future. We are proud of our accomplishments and we look forward to working with you to build on all that has been done so far. This concludes my statement, Mr. Chairman, and thank you again for the opportunity to appear. I would be happy to answer any questions the committee might have.
Mr. LUCAS of Oklahoma. Thank you. Mr. Stephenson.
STATEMENT OF ROBERT STEPHENSON, DIRECTOR, CONSERVATION AND ENVIRONMENTAL PROGRAMS, FARM SERVICE AGENCY, U.S. DEPARTMENT OF AGRICULTURE
Mr. STEPHENSON. Mr. Chairman and members of the subcommittee, I'm pleased to appear before you to discuss FSA's conservation programs.
The Conservation Reserve Program implemented by the Farm Service Agency is the Federal Government's single largest environmental improvement program on private lands. Today, the CRP is safeguarding millions of acres of American top soil from erosion, improving our quality, increasing wildlife habitat and protecting ground and surface water by reducing water runoff and sedimentation. Countless lakes, rivers, ponds and streams are cleaner, healthier and more useful because of the CRP.
CRP's success is accomplished through local voluntary partnerships between individuals and the Government. Instead of compelling participation, the program uses financial incentives to encourage farmers and ranchers to voluntarily establish viable conservation practices, such as permanent covers of grass and trees on land subject to erosion, where vegetation can improve water quality or to provide food and habitat to wildlife. Initially, the CRP emphasized reducing soil erosion. However, the public was becoming more sensitive to other environmental issues, such as the condition of streams, lakes and rivers and the need to preserve threatened wildlife species.
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In the 1990 farm bill, Congress broadened the program's focus and today, CRP's objectives include improving water quality, turning marginal pasture land into repairing areas, increasing wildlife habitat and other environmental goals. In 1993, total enrollment stood at 36.4 million acres, which is the maximum enrollment level. Today, enrollment stands at 33.6 million acres or about 10 percent of the crop land they reach planted in 2000, and CRP is providing rental payments to farmers and ranchers of over $1.5 billion per year.
Generally, farmers bid competitively for CRP contracts, maximizing the power of each dollar spent. Only the most environmentally sensitive cropland is accepted, while less vulnerable farmland remains in production. The result is an effort that targets the most sensitive land and helps farmers, while it keeps productive farmland growing food and fiber at a competitive cost. Environmental benefits measured in improved water, air quality and wildlife habitat have been estimated to total between $2 and $2.5 billion dollars annually. The CRP's benefits go far beyond environmental improvement. By idling highly erodible and environmentally sensitive cropland, the program also stabilizes crop prices, increases farm income, improves soil quality and helps maintain long-term productivity to the Nation's cropland.
In October 1997, FSA implemented a Conservation Reserve Enhancement Program. The partnership between the Federal Government and the State's, CREP addresses nationally significant environmental problems by targeting CRP Program resources. CREP is working to address water quality problems in the Chesapeake Bay, restore salmon habitat in the Northwest, protect New York City's water supply, enhance water quality in Illinois and Minnesota, restore the Great Lakes, improve wildlife habitat in California and North Dakota, protect water supplies for 54 communities in Missouri and restore vital estuaries in North Carolina.
For certain high priority conservation practices yielding highly desirable environmental benefits, farmers and ranchers throughout the United States may sign up at any time without waiting for an announced signup period, provided certain eligibility requirements are met. Continuous signup allows management flexibility in implementing special conservation practices on cropland. These are designed to achieve significant environmental benefits giving participants a chance to help protect and enhance wildlife habitat, improve air quality and improve the condition of America's waterways. Through mid-April 2001, 1 1/2 million acres have been enrolled under continuous sign-up practices such as filter strips, riparian buffers, contoured grass strips and grass waterways. The continuous signup effort has significantly increased the enrollment of these environmentally important practices. For example, enrollment of filter strips and riparian buffers has increased 10 fold compared with levels enrolled in the CRP prior to enactment of the 1996 farm bill.
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On April 13, 2000, USDA announced new financial incentives totaling up to $350 million over 3 years for producers participating in the CRP continuous signup.
These new incentives included a signing bonus of $100 to $150 per acre. A payment equal to 40 percent of the practice installation cost, increases in maintenance rate incentives for certain practices involving tree planting, fencing or water developments and updated marginal pastureland rental rates to better reflect the market value of these lands.
FSA also implements the Emergency Conservation Program, which provides emergency cost-share funding to agricultural producers to rehabilitate farmland damaged by natural disaster and for carrying out emergency water conservation measures during periods of severe drought.
The Pasture Recovery Program, which provides payments to reestablish permanent vegetative cover to owners and operators who have suffered pasture losses and the Debt for Nature Program for persons with FSA loans secured by real estate, who may quality for cancellation of a portion of their FSA indebtedness in exchange for a conservation contract with a term of 10, 30 or 50 years. I appreciate the opportunity to testify today and I'll be happy to respond to your questions.
Mr. LUCAS of Oklahoma. Thank you. Gentlemen, one of the comments that frequently come up in my town meetings in the sixth district of Oklahoma, and I suspect, occur across the country, are the comments about the backlogs in many of the conservation programs and the requests that you receive. From your perspectives, how much would it take in dollars and/or people to address the requests that both of your agencies have out there nationwide at the present time? Standing requests.
Mr. WEBER. Mr. Chairman, I can give you some figures in terms of backlog. And I want to be clear, these do not include 2001 applications. In WRP, Wetland Reserve Program, our backlog is approximately $560 million. In EQIP, our backlog is approximately $1.4 billion. In Farmland Protection, our existing backlog is about $160 million. And we expect another $90 million because this year's difference between how many dollars requested and how many dollars available. It is about that number. The Wildlife Habitat Incentive is approximately $20 million. For Forestry Incentives, it's approximately $10 million. And for our Emergency Watershed Flood Plain Program, which, in essence, is for restoration of flood plains, wetlands, we have a backlog currently of about $178 million. And in the Watershed Program, Small Watershed Public Law 566 and 534, our existing backlog is approximately $1.4 billion.
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Mr. LUCAS of Oklahoma. Speaking of the watersheds, in particular, having worked on the rehabilitation bill last year for the small watershed rehabilitation amendments, in particular, of course, having worked on that bill with a number of my colleagues on this committee, I have seen many requests come from out in the field. Could you focus on that, in particular, for a moment or is that information available? I realize some of the things I ask may require a response later, which is fine.
Mr. WEBER. Mr. Chairman, I do have that information. Currently, based on specific requests by sponsors, we have requests to do rehabilitation on 1,434 dams. The cost is estimated at $518 million. Those are current requests we have.
Mr. LUCAS of Oklahoma. And would it be possible to secure from you a copy of those requests?
Mr. WEBER. We'd be glad to provide them for the record.
Mr. LUCAS of Oklahoma. Please. Thank you. What percentage of the WPR is enrolled in permanent easements or 30 year easements or cost-share agreements?
Mr. WEBER. Mr. Chairman, I can give you the acreages. I don't have the percentages. But of the 1.05 million acres currently enrolled in WRP, 817,000 of those are under permanent easements. So roughly 80 plus percent. 165,000 acres are under 30 year easements. Something less than probably 7 percent. And the balance that are cost-share agreements amounts to 66,000 acres.
Mr. LUCAS of Oklahoma. How much of the cost-share are the producers responsible on the cost-share agreements?
Mr. WEBER. The cost-share agreements are 100 percent-excuse me. I don't have that on the top of my head. It is a sliding scale where permanent easements are 100 percent cost-share. 30 year easements—and I would need to get you the specific figure, but it is around 75, 80 percent. And I believe the cost-share agreements are in the 50 to 60 percent. But we can provide that for the record, specifically.
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Mr. LUCAS of Oklahoma. Good. Step back for a moment to the original question about the resources that are necessary. If you had those dollar amounts to work with, tell me about the personnel resources, the technical people you have. Could you fulfill the requirements that that would place upon your people in the field?
Mr. WEBER. No, Mr. Chairman. We could not. That would outstrip our ability to deliver that level of increase above the current level with the current workforce.
Mr. LUCAS of Oklahoma. What would you describe is your level of utilization now? Are your folks pretty much being fully utilized to address the needs that the resources are available for?
Mr. WEBER. My view is that our people are moving out at 110 percent. They are extremely committed, dedicated people. They work extra hours. They do what needs to be done to get the job done.
Mr. LUCAS of Oklahoma. Thank you, Mr. Hilliard.
Mr. HILLIARD. Thank you very much. Mr. Weber, let me follow-up on a couple of questions that the chairman asked. Could you share with us the dollar amounts that would be needed to help clear up the backlog for the various programs?
Mr. WEBER. Yes. I quoted those a minute ago. I haven't added them up in my head. But that would be the wetland reserve figure of $569——
Mr. HILLIARD. Well, let me ask it in another manner. Are they increasing?
Mr. WEBER. They will increase, sir.
Mr. HILLIARD. The need is increasing?
Mr. WEBER. Yes. They will increase each year because the number of applications continues to exceed the available dollars. So those numbers will continue to grow.
Mr. HILLIARD. So what can be done to meet the demand?
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Mr. WEBER. Well, obviously, one thing is increased funding to try to address the demand. Priority setting becomes very important in this process. To have a good, rigorous priority setting process that is fair and equitable, given limited resources.
Mr. HILLIARD. In your Forest Incentive Program, how much did the administration include in this year fiscal budget?
Mr. WEBER. I believe the administration did not include funding in that proposal for 2002 budget.
Mr. HILLIARD. And do you know why?
Mr. WEBER. I assume the decision was made that it was not a high priority with the administration.
Mr. HILLIARD. And what is your feeling, as one of the administrators?
Mr. WEBER. I think there's value added in the Forestry Incentives Program for conservation purposes, as in all of our other programs. But it is a matter of choices and setting priorities.
Mr. HILLIARD. Did you or did your office recommend that the program be continued?
Mr. WEBER. I believe so.
Mr. HILLIARD. Did you recommend an amount?
Mr. WEBER. I am drawing from memory, but I believe we recommended $6 million area, 6.2.
Mr. HILLIARD. Why was the recommendation for that amount?
Mr. WEBER. I believe that's the historical level that has been funded in the past.
Mr. HILLIARD. Do you think that there will be irreparable harm in the Forestry Program now that this money was cut out from the budget?
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Mr. WEBER. I wouldn't say irreparable on a 1 year basis. Long-term, there may be. Since this money is used for forest production purposes.
Mr. HILLIARD. Will you recommend it for the next year funding?
Mr. WEBER. I would, of course, our Chief would make those recommendations from the Agency perspective. But I believe we will be looking at making some recommendations to help fund it.
Mr. HILLIARD. Thank you very much. I have just a few more questions. I have a great deal of problems in Alabama, in my district, dealing with the wetlands and Endangered Species Act. Let me ask this. How does the Wildlife Habitat Incentive Program interact with the Endangered Species Act?
Mr. WEBER. Thank you. Mr. Hilliard, I want to make clear that there is no direct connection between the Wildlife Habitat Incentives Program and the Endangered Species Act. Wildlife Habitat Incentives Program is the voluntary conservation of wildlife habitat management plans and the actual practices, whereas the Endangered Species Act is more of a regulatory process. However, the Wildlife Habitat Incentives Program is a conservation tool that a land owner can use to put in place on their land, those conservation practices that will take care of their requirements under the Endangered Species Act.
Mr. HILLIARD. Thank you very much. Mr. Stephenson, I have heard reports that minorities and small farmers seldom utilize Government programs, which are available. Is this true? Can you tell me why?
Mr. STEPHENSON. I know that FSA's laws, the Department, generally, we are mindful of and maintain a number of outreach programs to ensure that the entire farming community participates in the programs. We have also been criticized in the past, both FSA and the Department, generally, that we have not been as effective as we should have been. I know that we are willing, I believe, to entertain the comments and make corrective actions where we need to.
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Mr. HILLIARD. From your perspective, what can be done to make the program available more to those group of farmers that do not use it now? Or what can be done to increase the incentive to use the program?
Mr. STEPHENSON. I think the first step involves getting the word out as to what it is we do. I think we are pretty good about getting information out in some of the agriculture press about what it is we offer. But I know some experience in dealing with some of the tribes, for example, is, that is not as effective in getting to the tribe as some one on one contact, meeting with the tribal leadership. Same things would apply, also, with some of the minority farmers where maybe the local churches might be the best place to go. I don't think we've done maybe as good a job with that as needs be.
Mr. HILLIARD. Mr. Stephenson, now, you do realize that some of these programs we set up specifically for minority and underprivileged farmers and small farmers. Tell me, what percentage of resources do these three groups receive of the budget?
Mr. STEPHENSON. I don't have those numbers with me. I assume that we could provide them. If we have programs that are authorized for particular groups or particular areas, then we will have data to show where those funds have gone.
Mr. HILLIARD. Is that information readily attainable?
Mr. STEPHENSON. That is a good question. I don't know.
Mr. HILLIARD. Would you check and see and let me know?
Mr. STEPHENSON. Yes, sir.
Mr. HILLIARD. Thank you very much.
Mr. LUCAS of Oklahoma. Mr. Moran.
Mr. MORAN. Mr. Chairman, thank you. Mr. Stephenson, last year, USDA changed its policy in regard to continuous signup on grass strips on terraces. We have worked through Congress, as well as with the Department to return to the days in which continuous signup was a possibility. What is the status of that issue and——
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Mr. STEPHENSON. Sometime last year, I forget the exact month, we issued a directive to our field offices to comply with the 2000 appropriations bill. So that language is out there now.
Mr. MORAN. You believe that it is now possible for continuous signup of grass strips on terraces. Is that accurate?
Mr. STEPHENSON. Well, let me put it this way. I haven't heard that no one has been denied.
Mr. MORAN. I appreciate the Department, perhaps reluctantly, reaching that conclusion. It is an important one certainly at home, in my State, particularly among the wildlife interested parties. And I think it makes a lot of sense in preserving our terraces, structurally. Mr. Weber, I heard you in response to the chairman's question talk about the split in WRP between cost-share, the 30 year easement and the permanent easement. Where is the demand? If we were going to prioritize where to put additional dollars or resources between those three opportunities, what is the demand situation?
Mr. WEBER. The demand, in terms of permanent, 30 year or cost-share, by far, the demand is in the permanent easement category.
Mr. MORAN. And why is that? What is the distinction? What causes someone to prefer the permanent or what is the circumstances that create that circumstance?
Mr. WEBER. I suspect it is those areas that folks have tried to farm, but have not had great success on any kind of a continual basis, obviously, because of dealing with climate and those issues. And really haven't recouped the financial returns from farming on those areas, so they see a benefit to themselves, both from an income perspective. Because in many cases, you get the real land value for the easement, 100 percent of it, essentially.
Mr. MORAN. What is the typical situation where the 30 year easement is used?
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Mr. WEBER. Thirty-year—of course, these would be dependent on the land owner's interest and goals. You may have a family where, say, the lead producer in the family is getting near retirement. They may choose to put that parcel into WRP with the idea that they want to have flexibility later on maybe for their children or a future generation to go back and have the option to farm that area or not farm it.
Mr. MORAN. Let me switch to EQIP. Is it true that there are greater demands being placed upon confined feeding operations from environmental rules and regulations?
Mr. WEBER. Absolutely.
Mr. MORAN. And do you see a role that EQIP can play or a greater role that EQIP can play in assisting those producers and the operators of those confined feeding operations in compliance through EQIP?
Mr. WEBER. Mr. Moran, I think that is an outstanding opportunity that EQIP can address. Right now, EQIP, we must provide 50 percent of the dollars to livestock operations not specifically to AFOS. But all of the tools are there, in terms of the [unintelligible] technical tools and practices, to handle the livestock waste from the rainfall onto the field and distribution systems and everything in between. So it is a tremendous tool in terms of having all of the components. And obviously, there is a limit, however, on the size of the facility in terms of waste storage facility cost-sharing, but that is one limit that does get imposed through statute.
Mr. MORAN. With the exception of the size restriction, what are the other restrictions in EQIP's ability to address the problems associated with CAPOS?
Mr. WEBER. There are no restrictions, really.
Funding and technical support are the key limits.
Mr. MORAN. I hope to talk throughout this hearing and later through the remainder of our committee's work on legislation that I have now introduced, H.R. 1938, that deals with a number of these programs. In fact, all of them. In what we think is a very common sense approach to trying to not only reauthorize the programs, increase the funding and the authorized levels, but to allow these programs, CRP, EQIP, WRP, WHIP, all to play a greater role in meeting the environmental needs of farmers and ranchers and other land owners. And a number of the items that you have mentioned are ones that we think we are utilizing this legislation to address.
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I would want to highlight the importance of what you said about the capacity of technical assistance. That as we, if we, in this farm bill expand authorized levels, increase programs and the nature of the programs, that your ability to deliver the service—I guess your testimony is you are at capacity. And so make sure we don't forget about the importance. And I noticed in your statement, you did not give us the opportunity to look the other direction. Thank you, Mr. Chairman.
Mr. LUCAS of Oklahoma. Mr. Phelps.
Mr. PHELPS. Thank you, Mr. Chairman and for having this hearing of valuable input for me. Mr. Stephenson, how many counties are above 25 percent?
Mr. STEPHENSON. The number of counties that are at 25 percent and the numbers that have exceeded it?
Mr. PHELPS. Yes.
Mr. STEPHENSON. We can provide those to you.
Mr. PHELPS. OK.
Mr. STEPHENSON. It is probably in the low hundreds is just a guess, nationwide.
Mr. PHELPS. Is the acreage that will be eligible to go into CRP Wetlands Program also eligible for WRP?
Mr. WEBER. Probably.
Mr. STEPHENSON. I am told probably.
Mr. PHELPS. Probably means you have to look at it to see or——
Mr. WEBER As I understand the Federal Register Notice and statute, converted wetlands, prior converted wetlands and farm wetlands would be eligible. Both of those would be eligible, generally speaking, under WRP, as well.
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Mr. PHELPS. Gentlemen, maybe both of you, maybe it's Mr. Weber's domain. One of the common frustrations of expressed when I am back in the district, talking to farmers is how complicated EQIP is. How do you think we can simplify that and why do they feel that way?
Mr. WEBER. I think we have got a handle on some of the issues that we are trying to resolve. Some of them are policy issues. Some of them are going to be statutory issues that we are going to need to have some assistance on. We have identified through a number of different outreach meetings of various groups and studies, really, the statutory issue has come down to a technical issue on carrying over dollars from one year to the next so they are not lost for conservation purposes.
The first year payment issue, where, in fact, a landowner is restricted from getting payment the first year of their contract, Mr. Hilliard, does impact negatively limited resource folks, as come out of our studies. The length of contract also affects limited resource and other communities. Currently, it is at 5 to 10 years, the statutory 5 to 10 years. And we are being told with folks needing to turn over dollars and receive their benefits that we should be looking at something less than that. We are looking at a 3 to 10 year contract term so that we can meet those concerns.
Mr. PHELPS. So the ability of the small landowners to qualify for assistance, you think, can be adjusted? Bonus points or something——
Mr. WEBER. Yes. One thing that is very unique, but very important to know about EQIP is that the priority setting process does take place—the evaluation process does take place at the local and State level. Folks can factor in and those communities can factor into those kinds of things in their evaluation process.
Mr. PHELPS. Thank you very much.
Mr. CHAIRMAN. Mr. Thune.
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Mr. THUNE. Thank you, Mr. Chairman, and I appreciate the panel. These are issues that are important in South Dakota and, of course, as we look at writing a new farm bill, conservation is going to be a very important component part of that. And we have had a number of raging debates in South Dakota over issues like wetlands, which I know you are quite aware of. And in some cases, have been able to work together to find what I think are win win solutions. One of which was this last year when we were able to create a pilot program that would allow acreage within filter strips and buffer zones to be eligible for the continuous signup program. And I think that is what we ought to be doing, is looking for ways in which we can get the wildlife community and the producer groups and everybody working together to find those win win solutions.
One of the things I would be interesting to get your reaction to what I think is a proposal that is in that vein. And that is the Conservation Security Act, which I know my staff has been working, I think, with NRCS staff and you have been working, as well, with the Senate sponsors of that legislation to try and determine what is what the estimates are as to how many producers would participate in that program and the first 5 years, the first 7 years, the first 10 years, coming up with cost estimates of the proposed program. That is something that seems to be a matter of discussion and debate and, frankly, dispute, as well, about what the program might cost.
But in my mind, it seems, at least, if we can find something—conservation programs that are voluntary, that are incentive based for our producers, that provide flexibility to local level, that aren't dictated from Washington. And also, the thing that I think is really sort of unique about the Conservation Security Act is it allows producers to continue to farm the land and they don't have to sacrifice or give up the income that they otherwise might if they had to set aside in some other conservation program. So, anyway, having said all that, I guess I am just curious to know if the Agency has run any cost estimates of that proposal.
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Mr. WEBER. I am not personally aware of any specific figures. I do understand that a request came to the Office of the Chief Economist in USDA and they have run various scenarios and provided those, I believe, to the Hill. But I don't have those figures, specifically, myself.
Mr. THUNE. OK.
Mr. WEBER. And I wouldn't want to preempt the Department's work in that arena.
Mr. THUNE. Do you have any estimate about what likely participation rates might be in that sort of a program, just based on past experience?
Mr. WEBER. It's a unique stand alone identity. It is a little hard to guess. It depends on, of course, the level of incentive, is going to drive up the participation rate, depending on the levels of incentives. So it is a matter of what assumptions you put into it, frankly.
Mr. THUNE. OK. And I think that the level of incentive is connected, obviously, to the degree of detail that an individual producer would put into this plan. It is a tiered program, which if you become more comprehensive in your conservation practices, that you would benefit in a higher level, in terms of the compensation you will receive. Which, again, I think is part of the uniqueness of the concept. And that is that there is flexibility there. And I know, going into this, that it is a different of enough of approach, there are, again, some people who are going to be resistive to change and reluctant to go down that road for that reason and will probably look at more of the traditional programs and say, well, let us figure out what we can do to expand those. But I really see this as a reform oriented program and one, again, which I think draws on the best of all the various communities who would benefit, not only the producers who would benefit from additional income, but also from the environmental community, the wildlife community. Something that is very important in my State is wildlife habitat. We have a very significant recreational economic development initiative going in our State. It is called pheasant hunting. And we want to continue to see that prosper, as well. So let me just, if I might, ask one question, wrapping up. And that is, has the Agency determined what some of the cost estimates are to producers for environmental regulations like TMDLs and CAFOs and coming back to Mr. Moran's line of questioning earlier, a little bit about what some of those regulations actually cost producers?
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Mr. WEBER. Mr. Thune, I am happy that you asked that question because it has been a concern of NRCS's over the last couple of years as EPA has been developing the rules on both CAFO and TMDL. Currently, on the cost side, USDA is working jointly with EPA to do a cost and capability analysis. It is expected that that will be completed before December 15 of this year. In terms of the technical assistance costs, those kinds of things, we can only estimate, of course, how many folks are going to come through the door. And that will be dependent, obviously, on the regulation and the stringency of the regulation. We are estimating about 272,000 AFOs will come through the door requesting assistance. And by assistance, I am saying they will expect a plan for their operation and they will expect technical help to implement that operation or plan. We are estimating that is going to run us about two-tenths of a staff year, per. So the mathematics gets to be rather large. And the cost gets into several billion in technical assistance alone for that.
Mr. THUNE. OK. I appreciate that answer. And thank you for your testimony. I see the heavy hand of the chairman here, as getting ready to gavel me down. So I yield back. Thank you, Mr. Chairman.
Mr. LUCAS of Oklahoma. Thank you. Mr. Kind.
Mr. KIND. Thank you, Mr. Chairman. I just want to thank you for your permission to participate in this subcommittee hearing. I am not a member of the subcommittee, but rather a member of the whole committee. I do believe this is going to be a very important part of the farm bill that we are trying to put together and reauthorize this year. I do have a written statement that I would ask unanimous consent to have submitted for the record. And Mr. Weber, let me start with you. I have got a few important issues in the upper Midwest, especially in light of the recent flooding along the Mississippi River. My congressional district in Westchen, Wisconsin has more miles that border the Mississippi than any other congressional district. So we certainly appreciate the value and the importance of wetlands reserve and what that means to a nonstructural flood mitigation approach to rising waters and that. We also see the back load that we have now in applicants trying to get enrolled into WRP. There is going to be a supplemental coming up shortly. And I was wondering if your Agency is willing to submit a request for an expansion of WRP enrollees in light of the positive flood mitigation effects that that also has.
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Mr. WEBER. Thank you, Mr. Kind. It is good to see you again. We will be working with the USDA leadership, in terms of deciding what will go forward relative to WRP. But we will need to consult with them.
Mr. KIND. We will be happy to work with you on that because I think this is an opportunity of emphasizing a very important program, a program that has been under funded. But also brings tremendous amount of a benefit, not only to wetlands protection and wildlife protection, but also the obvious effects that high water and floods have on communities. Farm communities and smaller communities that border the river. I am hoping that we are able to do something significant in the conservation portion of the farm bill. I think this is a wonderful opportunity for us to be able to provide not only technical assistance, but some cash assistance to farmers that want to be good land stewards. Many of them are being turned away right now because of the inadequacy of funding. This is a way of not getting into trouble with trade agreements and WTO rules. And as Mr. Thune indicated, it is an opportunity of creating some win win situations when you consider the fact that over 30 percent of our rivers and streams and lakes are not fit for swimming or fishing or drinking purposes. There is certainly a demand, and we see that from the land owners, themselves, the producers who are trying to get into the programs. Obviously, there has been a lot of discussion in regard to technical assistance. And I believe your Agency is calculated in order to meet the demand of just technical assistance. We are going to have to have a three-fold increase in field staff over the next 5 years, which is a tall order, obviously, to fill. My question to you, Mr. Weber, is would the Agency be willing to consider the certification of third parties in order to help with the technical assistance demand that exists throughout the country?
Mr. WEBER. We currently have a policy which does allow us work with third party vendors and also organizations that certify third party vendors in terms of accepting their credentials and their technical work.
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Mr. KIND. On your opinion, and how effective has that been? Is that in an area that we may consider expanding into?
Mr. WEBER. It is a bit in its infancy, frankly. It came out of the 1996 farm bill. And we have had several agreements with various professional certification groups that have developed over the last few years. But I would say the critical mass of activity working with third parties is really not matured at this point. So it is a little early to tell.
Mr. KIND. OK. And finally, before we run out of time, I know there is going to be a lot of talk, a lot of concentration and reauthorizing these programs, perhaps plussing up funding for them and that. But are your two agencies conducting or receiving some good research based scientific studies on the overall effectiveness of these programs so that we know we are getting a decent bang for the buck that we are investing in land conservation, whether it is CRP or the host of other land conservation programs out of USDA? Is this being driven by some research, at least? Some scientific study showing the overall effectiveness of these programs?
Mr. STEPHENSON. I know that there has been a number of ad hocs that he has done on CRP. Whether it is this university, that university, some of the outside groups. Interior, actually, some years ago, did some research on the effectiveness of CRP, only with respect to the threatened and endangered species. We have considered trying to come up with some type of long term substantive study on CRP. There is a fair amount of cost associated with that and a fair amount of time to come up with an objective study. But we have talked about it, generally, down at FSA and some of us would like to do that very quickly.
Mr. KIND. Mr. Weber.
Mr. WEBER. A couple things. One, we have a fairly current report from our Wildlife Management Habitat Institute that has taken a look at least at the wildlife impacts of various programs since the 1996 farm bill. I guess the biggest data source that we would look at would be the status and trends that come out of our National Resource Inventory. It is a 5-year frequency. We have tracked trends of soil erosion, agricultural land conversion, wetland conversion, et cetera, for decades. And, of course, 1997 was the last year where we generated the results, which were very revealing, in terms of the progress we are making and the challenges ahead. I think that probably forms intellectually, from a science based resource standpoint and inventory point, a good point of debate on using that information. It does come down to the State and lower levels, so you can start to analyze impacts both of programs, as well as resource impacts. For example, the 38 percent reduction in soil erosion that we have accomplished since 1985 is pretty impressive. The conversion of agricultural lands—well, conversion of all wetlands to nonagricultural purposes has dropped to less than 30,000 acres a year and even less than that, if you are talking just for agricultural purposes, conversion of agricultural land for agricultural purposes. So we have got some real trend data there. It is statistically valid. We have 800,000 sample sites around the country, so I think that would form a major piece of information.
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Mr. KIND. Well, I think that is another area we would be happy to work with your respective agencies to see if we can develop some good science based studies, so we know we are getting a decent investment. Thank you, Mr. Chairman.
Mr. LUCAS of Oklahoma. The gentleman's time has expired. Mr. Osborne.
Mr. OSBORNE. Just a cursory look at your data here would indicate that roughly one-third of your applicants to the various programs are served and maybe two-thirds are not. And indicates, as I add them up here, a backlog of about $3.5 billion or something like this, to fully service everyone that wants to be involved. And we are going to have to write a bill here fairly soon. And what is your estimate as to what funding we should have for the conservation title in order to adequately take care of these programs? On an annual basis. Do you have any thought? Because we are going to, at some point, have to address that issue.
Mr. WEBER. It would be a best estimate only and it would not represent the administration.
Mr. OSBORNE. Yes.
Mr. WEBER. But I believe we have roughly—Bob mentioned $2 billion a year, alone, for CRP. So that is a current level figure. The rest of these programs come to, I think, and I am including the technical assistance in all the conservation programs here, not just the cost-share. But I believe that figure is around $1.3 billion when you add it all together. So there is $3.3 billion package right there. And then on top of that, I think you can look at the backlog. So perhaps a $5 billion figure could be a figure to talk about. Somewhere in that vicinity. Recognizing you probably won't address the whole backlog in 1 year. It is going to be a multi year kind of thing.
Mr. OSBORNE. So what you are estimating there would be $5 billion would take care of everything, plus the backlog?
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Mr. WEBER. No. No.
Mr. OSBORNE. You are not. OK.
Mr. WEBER. It would be $5 billion a year.
Mr. OSBORNE. OK.
Mr. WEBER. And you would take care of the backlog over a period of probably 3 to 5 years in that process.
Mr. OSBORNE. But the backlog is included in the $5 billion?
Mr. WEBER. I think the mathematics, it would work out roughly at that. Yes.
Mr. OSBORNE. OK. Good. Well, I appreciate that because it gives me a little bit of a frame of reference as to where we are talking about here. The other thing I would like to ask you about is on the EQIP Program. I noticed that it is authorized at $200 million per year. And it kind of jumps around a little bit. We had $174 million, 1999, $174 million in 2000 and it jumps up to $220 million in 2001 and goes back to $174 million. And one of the main complaints we hear is inadequate funding. Just a lot of people wanting EQIP help don't get it. Why do we see the variation in this? Also, the WHIP Program. Looks like some years, there is no funding at all and some years, there is. So is there any reason for the variability?
Mr. WEBER. It depends on the annual appropriations, of course, that come from the farm bills. But EQIP, for example, it started out its first year, which was 1997, at a figure of—I think the figure was around $175 million, as it is shown here. There was a transition involved there. The next 2 years, 1998, 1999 and 2000, I believe were at the $174 million level total. That is everything in EQIP. Technical assistance, financial assistance, everything. And then this last year, it was appropriated at $174 million and then there was an additional $26 million added later on in the appropriations process. So this year, it is at $200 million. So that number varies depending on the appropriations annually. The same would be true of WHIP, except WHIP had the cap of a total of $50 million. The whole cap, total. So as soon as you hit $50 million, whether it is the first year or multiple years, unless Congress then increases that cap through appropriations process, then that is the limit you hit.
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Mr. OSBORNE. OK.
Mr. WEBER. The same thing is true on the WRP acreage, except it is acreage versus dollars. Caps.
Mr. OSBORNE. OK. Thank you and thank you for coming. Thank you for your testimony and I yield back the balance of my time, Mr. Chairman.
Mr. LUCAS of Oklahoma. Thank you, Mr. Osborne. I think it is worth noting the line of questioning you pursue is very good. While we authorize for 3 years or 5 years or 7 years at a time, the appropriators tend to re-write us every year, so to speak, as they pass their bills, which is another one of the many reasons that we need to be so thorough and methodical in our hearings, is to make the case for our friends in other parts of this building that only establish priorities. They need to be implemented. With that, we turn to Mr. Kennedy.
Mr. KENNEDY. Thank you and thank you for your testimony. One of the questions I have is I have worked with the people at the local level on soil and water conservation districts or State level organizations, as well as your offices there. What would be your response to saying are we adding something at the Federal level that we couldn't achieve by just having a block grant down to the State level or down to the soil and water conservation districts, for them to work in their own areas on the conservation priorities that are deemed highest at the local area? What would your thoughts be on that type of a program?
Mr. WEBER. Thank you, Mr. Kennedy. What you are buying for—the Federal delivery system and, of course, that is the technical people. What you are buying is you are buying a consistent set of standards. You are buying a consistent set of administrative processes. You are buying an oversight, an assessment process that looks at these programs and the implementation of these programs and the development of these programs in a consistent manner. You are buying quality control. You are buying liability insurance, so to speak. And at the same time, probably most importantly, is you are buying the partnership that works together at the local level to actually accomplish this work. The equivalent technical work force to the NRCS work force. Which is out there now in many States. The training that is provided. The technology development and dissemination that is provided through the national systems. And most of our programs are reflective of the local needs and priorities. We have tried to design them to do that. We don't try to make the decisions in Washington, by all means. We try our best, within the confines that we have to work, statutorily and otherwise, to make sure that the local folks have a say in making the decisions that they think are their priorities.
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Mr. KENNEDY. And they speak quite highly of the partnership role that you play in the technical assistance and training that should get but I am struck by being in several meetings, for example, the Soil and Water Conservation Society held a series of hearings around the country. And as I read each region's response, you thought they were on different planets as to which of these programs they thought made the most sense. And so for us to decide up here which makes the most sense, I am not sure. And I am just struck with maybe better off, in addition to the programs we have is whether we are better off supplementing that with some block grants that maybe they could also contract back with you to the extent they needed additional services to do. But to try to, instead of us having to make the decision and guess what is best for the country as a whole, get more local flexibility and local involvement in those decisions. Not replacing NRCS, but, like, empowering them. What other ideas would you have as to how we can make sure the local people are empowered in this decision process?
Mr. WEBER. Mr. Kennedy, I would say, from my view, that we just need to do a better job of institutionalizing the local power in the decision making process. We call that locally lead in the partnership. And we have tremendous examples around the country. I think Mr. Osborne in Nebraska, you have a tremendous relationship between the natural resource districts out there and the NRCS and others in making sure that those decisions do reflect the local priorities out there. And I think we probably need to do a better job of that all over the country. I think there is flexibility to do that. We just need to make sure that that flexibility is utilized.
Mr. KENNEDY. And if we were to look at the continuous signup program, I mean, I am struck as I go around my district, that I see lots of places where that is able to be used and it is not being used. How much of that backlog would you say would be in some of the continuous signup programs portion of the backlog in CRP?
Mr. STEPHENSON. Are you referring to the technical assistance portion of——
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Mr. KENNEDY. I am talking about the riparian strips and all the other types of buffer strips that qualify under the continuous signup program today. If we were to say of the backlog in CRP, how much of it is the types of programs that are eligible under continuous signup versus those that would not be?
Mr. WEBER. It is a little difficult for me to answer. Continuous signup was designed to avoid long lines during signup and things like that. Because you can come in at any time and a farmer can use it as a management tool. When they need it, they can sign up. We do know that in some parts of the country, there are a backlog of farmers getting the technical assistance that is needed. There is also a backlog in some cases of the FSA employees of not being able to service them timely because they are providing loan deficiency payment service. As far as the numbers of, I don't have those with me.
Mr. KENNEDY. Thank you.
Mr. LUCAS of Oklahoma. Mr. Putnam.
Mr. PUTNAM. Thank you, Mr. Chairman. How evenly distributed is your backlog? Does every State have a backlog? Does every region have a backlog? Does every soil and water conservation district have a backlog?
Mr. WEBER. Mr. Putnam, let me give you some examples. Wetland Reserve Program, it varies by State. The large numbers for Wetland Reserve Program are in Arkansas, Iowa, Louisiana, Missouri. And the vast majority of the other States have some, certainly smaller than that. But you do have States, like Georgia, that is zero. Hawaii is zero. Maine is zero. New Hampshire, New Jersey, New Mexico are zero. So it does vary, geographically, based on the resource, based on the interest of the communities and the people out on the landscape and what fits their needs.
Mr. PUTNAM. Is there enough flexibility in the program for you to redistribute personnel and resources to meet the backlogs from the States that have no backlog?
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Mr. WEBER. It depends on the other priorities that they are working on. For example, they could be doing AFO in those other States. It's not an easy question to ask or answer. We would need to look at all of the workload, how it is distributed and the priorities of the Agency to look at any redistribution of personnel.
Mr. PUTNAM. You said that you would require a tripling of personnel to implement AFO and TMDL restrictions, I believe.
Mr. WEBER. I didn't say that, but our estimate is it would be about 52,000 staff years over the life of doing the work.
Mr. PUTNAM. And how many staff do you have currently.
Mr. WEBER. We have a total staff right now, nationwide, of 11,500 staff years.
Mr. PUTNAM. Staff years?
Mr. WEBER. Staff years. Yes.
Mr. PUTNAM. How many people is that?
Mr. WEBER. I would say that is roughly 12,500. when you throw in people that are intermittent employment, temporary employment, et cetera.
Mr. PUTNAM. In the States that have the larger backlog, are those the States where you have chosen to pilot the private sector or other agencies for technical assistance?
Mr. WEBER. We leave that flexibility to the individual State conservationists.
Mr. PUTNAM. And in how many instances have they taken advantage of that opportunity?
Mr. WEBER. I believe, the one I am aware of that they have done some work through consultant third parties, I believe, is New York State. Now, I can't give you the specific assessment of how well that has been going. But I do know they have had a relationship for a couple of years.
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Mr. PUTNAM. You have had authority to enter into agreements with the private sector for technical assistance since the 1997 bill?
Mr. WEBER. We have had authority to work with third party vendors. Yes.
Mr. PUTNAM. And you testified that it hasn't had an opportunity to reach critical mass.
Mr. WEBER. Right.
Mr. PUTNAM. But it has been in place since 1997 and there is only one State doing it. So nobody is taking advantage of the opportunity.
Mr. WEBER. I am aware of one State that has had a good, strong relationship. I can't say for sure that there aren't other States that may be utilizing third party vendor relationships. We are not paying the third party people. They are being paid by the landowners. They are certified sources of technical assistance that we work with.
Mr. PUTNAM. Let me change gears real quick. How do you define success in any of these environmental programs? How do you quantify pounds of nitrates reduced, pounds of phosphorous reduced, number of nesting pairs of endangered or threatened species increased, reductions in pollutant loads or whatever pounds of carbon sequestered. How do you define success?
Mr. WEBER. That is one of our chief problems on the CRP side because we don't know, for example, how many nesting pairs you can attribute directly to CRP versus normal fluctuations. We don't know, for example, how many tons of soil—collectively, we have numbers, but we don't know for a particular site, how much is related to CRP, how much is related to other land use practices on the farm.
Mr. PUTNAM. But you testified that you have a report that says that these programs generate $2 billion to $2 1/2 billion in benefits.
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Mr. WEBER. Yes. And it is a range of numbers. And the reason it is a range because we don't have databases to go out and define every benefit we get and that is attributable to each program.
Mr. PUTNAM. So if we were to waive our wand and fully fund the number that you gave plus the backlog, you couldn't quantify the net environmental improvement to air, water or land that would be derived from that investment. Can you?
Mr. WEBER. Are you talking to me?
Mr. PUTNAM. Yes.
Mr. WEBER. Oh. We could quantify it in terms of the resource improvements that we would get on the ground.
Mr. PUTNAM. How would you be able to do that if you can't quantify what you are doing now?
Mr. WEBER. Let us say if you put in 100,000 animal waste systems. How much waste has been properly managed. What the nutrient benefits from handling it properly are to keep it out of the water. From going into the air. You can quantify those benefits. The amount of soil erosion saved, the amount of soil that doesn't get into the water or the lakes. Now, to make the next step in terms of the outcome, the outcome, is a more complex process. It is a modeling process. And the state of the state is not, at this point, a precise science. That is where we depend on NRI and other tools to help us plot the trends.
Mr. LUCAS of Oklahoma. The gentleman's time has expired. And due to the lateness of the hour, the ranking member and I would request that the panel answer two questions in writing. Number one, we would like to know how you allocate your technical resources and people among the States and within the county offices within the States. Surely there is a policy somewhere that you can draw upon for that. And question No. 2, we have discussed, in round about ways here at this hearing about potentially increasing the resources for conservation $2 1/2, $5 billion. There has been talk as much as $6 billion or $8 billion a year. I would like for you to explain, since we are fully utilizing our personnel, just how many more people we would have to have and what it would take to make that possible to be able to achieve these goals, if the money were available. And with that, gentlemen, thank you for coming and testifying today and providing your insights.
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Mr. WEBER. Thank you.
Mr. LUCAS of Oklahoma. I would like to invite the second panel to the table. Mr. Wythe Willey, president-elect of the National Cattlemens Beef Association from Cedar Rapids, Iowa on behalf of the Livestock Coalition. Bill Horan, president of the Iowa Corn Growers Association from Rockwell City, Iowa, on behalf of the Crop Coalition. Mr. John Lincoln, president of the New York Farm Bureau, Bloomfield, New York, on behalf of the American Farm Bureau Federation. Mr. Willey, may begin when you are ready.
STATEMENT OF WYTHE WILLEY, PRESIDENT-ELECT, NATIONAL CATTLEMEN'S BEEF ASSOCIATION
Mr. WILLEY. Thank you, Mr. Chairman, Mr. Hilliard. As the chairman said, I am Wythe Willey. I am a farmer from eastern Iowa and I am with the National Cattleman's Beef Association, but here this afternoon to provide testimony on behalf of the National Associations representing cattle, dairy, pork, sheep, poultry, broilers, layers and turkeys, collectively referred to as the livestock sector. And also, the Alabama Farmers Federation joins with us in this prepared testimony. I would ask those folks that are in that group to stand up and to let you know they are behind me. And just quickly, without introducing them, I will proceed.
We know that the members of this committee understand better than anyone the significant economic contributions that livestock producers make to U.S. agriculture. Livestock receipts, projected to reach $100 billion annual this year, consistently average over half of total ag receipts. We are the single biggest customers for U.S. feed crop producers and the single largest expense, by far, for livestock producers is feed we purchase for our animals. Without a doubt, livestock agriculture is the engine behind value added agriculture.
In addition, we also manage more than 600 million acres of land in this country, which is another indicator of just how important this sector is in meeting the country's economic and natural resource objectives. It is our contention that the 2002 farm bill must make a major investment in helping livestock producers with conservation cost-share and incentive pay programs through voluntary, incentive-based programs. This assistance is needed to help us design, install and help manage livestock waste management systems. The financial assistance should be matched by an ample supply of public and private technical assistance. One reason for this request is simple. Livestock producers in many States face or will soon face costly environmental regulations as a result of Federal or State law designed to protect water and air quality. These regulations will come from the Clean Water Act, TMDL Program, the proposed CAFO permit requirements and the Clean Air Act.
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We have several specific suggestions and provisions—and requests for provisions to be included in that 2002 conservation title. Our written testimony goes into those items in some great detail. The major highlights of what we suggest are as follows.
As noted in table 1, in our written testimony before you, more than $12.2 billion is needed to address the projected 10-year costs of Federal, State and local mandatory manure management, water and air quality protection requirements. You will notice we have those broken down by species. Producers must be eligible for this assistance, regardless of the size of their operation.
A Payment Limitation Program comparable to that used in row crop Operations should be adopted. Funding for livestock waste management systems should be a national priority and addressed irrespective of other priorities that might exist for the program that is used to deliver those funds. We are going to need the joint effort of Federal and NonFederal technical assistance providers to implement these livestock provisions.
A voucher system could be developed to support the NonFederal technical assistant provider's role. These needs could be met through substantial amendments to the Environmental Quality Incentives Program, EQIP, or in an entirely new program. If carried out, through EQIP, EQIP should be amended to focus exclusively on soil, water and air quality issues. The current wildlife objectives supported by EQIP would be moved to an existing Wildlife Habitat Incentives Program, called WHIP, making WHIP the wildlife program for working agricultural lands.
Once livestock waste management systems are installed, producers will need help with the ongoing maintenance of the systems. This could be done through EQIP or another incentive payment program. Those provisions could also work for and support the needs of row crop producers. Such an incentive program will work only if the payments are tied to real costs, according to conservation plans that are clear and accountable, while producers will have ownership of the practice and by also incurring cash or in-kind costs to implement them. The program must ensure that producers be compensated fairly relative to producers anywhere in the country.
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In our opinion, the Conservation Reserve Program should place less emphasis on enrolling whole field, more emphasis on enrolling buffers and portions of fields. The number of whole fields enrolled should be substantially limited and there should be some flexibility in management of those CRP Programs.
Mr. Chairman, thank you for holding this hearing and giving us a chance to present our testimony. This statement today reflects livestock producers deeply held committment to protecting environment, protecting water quality and managing our operations and the resources in our care responsibly. Livestock operations need help if they are to be maintained economic viability, be able to conserve natural resources for future generations and provide the environmental benefits being demanded and mandated from American agriculture. We pledge to work with you toward those goals and I will be glad to be here and answer any questions you might have.
Mr. LUCAS of Oklahoma. Mr. Horan.
STATEMENT OF BILL HORAN, PRESIDENT, IOWA CORN GROWERS ASSOCIATION
Mr. HORAN. Good afternoon, Mr. Chairman. My name is Bill Horan. I raise corn and soybeans in a partnership with my brother, Joe, in Rockwell City, Iowa. I am a member of the National Corn Grower's Association Board of Directors and I am testifying today on behalf of the NCGA, the American Soybean Association, the National Association of Wheat Growers, the National Cotton Council and the National Barley Growers Association. I appreciate the opportunity to offer this testimony.
The members of our organizations are committed to begin good stewards of the land and leaving the environment in better shape than we found it. We take responsibility for our farming activities and must do so with a keen eye towards conservation, productivity and marketing.
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We support the voluntary, incentive-based conservation programs the past farm bills have created. We believe that the flexibility in the programs is essential for their widespread adoption, given local variances and conservation and water quality priorities, production, practices, climate, soil type and many other factors. These programs have demonstrated agriculture's commitment to working collaboratively with the U.S. Department of Agriculture to reach our environmental goals and we believe that these voluntary programs have been successful in producing environmental benefits. Any new programs should contemplate financial assistance for conservation practices on resources and management that support production and generate environmental benefits.
As we look at broad Clean Air Act issues and regulations, we know that agriculture plays an important role in maintaining a healthy environment. All agriculture producers face the increasing regulatory burdens, whether it is local, State or Federal requirements on the management of their land. We support programs that will work with our members in utilizing conservation practices and work to maintain a healthy environment. A Conservation Environmental Incentive Payment Program could assist growers in meeting those increasing requirements. This approach recognizes an important part in adoption of conservation practices across the farming community, which is the growers need financial and technical assistance in management of their operations based on conservation principles.
Intensive resource management practices can become important as a filter strip or a buffer strip in achieving conservation goals. But these management practices or choices frequently add to the cost and risk of farming operation. These are the areas that should be included in the development of the Conservation Title of the next farm bill. Policymakers can work with growers to identify conservation practices that fit in with their management stewardship of working land. Any program modifications or enhancements must maintain flexibility for local implementation to maximize both participation and effectiveness.
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Regarding existing programs, we support continuation of the existing cost-share programs, including the Conservation Reserve Program, CRP, including continuous signup, Wetlands Reserve Program, WRP, Wildlife Habitat Incentives Program and others. These programs have been an excellent investment in the public and have generated significant environmental benefits, as documented by USDA. Programs that take land out of production should be managed so as not to take all farms out of production. The focus of the continuous signup should be on small areas of specific environmental value and there should be local flexibility to meet the environmental concerns facing a specific area of the country. We believe that the CRP should be fully utilized to 36.4 million acre cap and that any additional land enrolled should be the most environmentally beneficial land, utilizing the continuous signup. While the Wetland Reserve Program has generated enrollment that is expected to reach the 1,075,000 acre cap this year, as with CRP, we do not support increasing the acreage cap at this time.
Regarding the provisions of the 1996 farm bill, concerning wetlands and highly erodible land, we support maintaining the flexibility the farmers were given in the bill. NRCS has been unable to implement some of the flexibility that was granted in 1996, due to a lack of cooperation of other Federal agencies. However, we would urge that the committee to see that that that flexibility is maintained and that growers are able to utilize these provisions. Also, the implementation of wetland regulations has not been consistent across the country. And we ask the committee to encourage NRCS to implement wetland rules fairly and consistently.
In my part of the world, where I farm, Mr. Chairman, we have many wetlands due to the size of this room with very little utility. Two inches of water in them, maybe 10 days out of the year. And it brings into effect the respectable duck rule, which is no respectable duck would land in that place and build a nest and try to raise ducklings. So the idea of mitigation banking, which was brought up in the last farm bill, we thought was very useful. It was something that we could have done to take those low utility wetland spots, like I have the size of this room, mitigate those into a large, high utility wetland that actually has some benefit to wildlife. We are hoping that that can be part of the next farm bill.
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The Environmental Quality Incentives Program, while designed to target scarce financial resources, has become a very complicated program for commodity producers to utilize. Many were understanding of the desire to consolidate programs and prioritize project areas, but of the ensuing challenge and dissatisfaction centers around who gets access to limited funds. Improvements should be made to the program to expand the flexibility and allow more producers to participate and increase the total funds available.
Each of these programs mentioned provide an integral part of the overall conservation and environmental water quality objectives. Federal farm programs provide financial resources and technical assistance to facilitate the adoption and management of conservation practices. Federal, State and local cost-share programs are essential for the greater benefit provided to these practices. Our members are engaged in farming as a livelihood and must maintain the ability to raise productive crops on their land and market crops to maximize profitability.
I will conclude, Mr. Chairman, by saying that each of our organizations are facing their own production and marketing challenges. Low commodity prices, coupled with increasing input costs, new regulatory burdens and the need to continually increase productivity have resulted in serious cost/price squeeze and low farm income.
We appreciate the opportunity the committee provided for each of us, our organizations to present specific commodity program proposals. We also appreciate the efforts of the committee to secure additional funding for agriculture in the new budget resolution. As we have each presented the committee with commodity specific proposals, we share the conservation goals outlined in this statement and the belief that the conservation title should work in conjunction with a fully funded commodity title. It is essential to use the provisions of the conservation title provide voluntary, incentive-based options for producers, but not replace or serve as a substitute for the commodity programs proposed by our organizations in earlier hearings. Producers need to be given flexibility in meeting increasing regulatory challenges, whether they are local, State or Federal requirements placed on their operations or the management of their land. The USDA technical assistance local watershed activities and cost-share programs are a proven approach to addressing environmental challenges. We support continuing this conservation commitment to help undertake conservation practices on productive farmland throughout the reorganization of the conservation title of the next farm bill. Thank you, Mr. Chairman.
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Mr. LUCAS of Oklahoma. Thank you. Mr. Lincoln.
STATEMENT OF JOHN LINCOLN, PRESIDENT, NEW YORK FARM BUREAU
Mr. LINCOLN. Thank you and good afternoon. Mr. Chairman, I am John Lincoln, president of the New York Farm Bureau, and a dairy farmer from Ontario County, New York.
Increased regulatory costs at all levels, Federal, State and local, are placing a heavy burden on individual farmers and ranchers, as well as distorting the traditional structure of the industry. The unintended consequence is the inability of small and medium-sized family farms to complete in a highly charged regulatory environment.
Farm Bureau believes there is a need for a new environmental policy framework. We need to move beyond the current debate over whether the public has the right to mandate features and/or farming practices and rural landscape. If a voluntary incentive is offered for a desirable environmental outcome, farmers will overwhelm America with improved soil conservation, water quality, air quality, wildlife habitants.
In order for a Conservation Incentive Program to work well, public policy must recognize the inherent limitations that command and control regulations have in attaining desired public benefits of an environmental nature. Efficient public policy is one where the thing demanded by society is the thing that is being produced.
Farmers and ranchers can produce and market more than traditional agricultural commodities. We can also produce and market environmental benefits. Under this concept, agriculture and the Government program must come together to create an alternative market for environmental improvements and amenities that the public desires.
Farm Bureau policy supports expanded incentives to encourage voluntary improvements in the environment, expansion of the funding baseline in the commodity, specialty crops, livestock, conservation, research, trade and risk management titles. Voluntary participation and direct payment program that would comply with the green box World Trade Organization requirements and providing willing producers with additional voluntary incentives for adopting and continuing conservation practices.
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Our vision is to capture the opportunities and the efficiencies of providing producers with additional conservation incentives. Specifically, I would like to highlight three programs for which we would like to see new funding.
First, Farm Bureau supports a limited increase in the amount of acreage eligible to be enrolled in the CRP, with the new acreages targeted to buffer strips, filter strips, wetlands or grass waterways should be improved.
Second, the current Environmental Quality Incentives Program does not provide livestock and crop producers with the assistance needed to meet current and emerging regulatory requirements. EQIP must be reformed and funding increased. We support the following reforms to EQIP. Elimination of the language that prevents large livestock operations from being eligible for cost-share, broader third party technical authority, which would allow farmers to hire consultants to provide technical assistance, elimination of priority areas in which would allow all producers, regardless of location, to participate in the program and simplify program participation requirements.
Finally, I wish to express or support for a voluntary environmental program that provides producers with additional conservation options for adopting and continuing conservation. This approach would provide a guaranteed payment to participants who implement a voluntary management program to provide specific public benefits by creating and maintaining environmental practices. The management plan should be flexible contract designed and tailored by the participant to meet his or her goals and objectives, while also achieving the goals of the program.
We support an increase in the budget baseline of $3 billion, annually, for three conservation initiatives I have outlined. Other conservation programs supported by Farm Bureau are the Grazing Lands Conservation Initiative. Grazing Land Conservation Initiative is a program providing additional technical assistance through NRCS for arranging pasture management. We support the continuation of this program.
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Confidentiality of USDA information has become an increasing concern and priority for farmers and ranchers. We have seen attempts by other Government agencies to secure NRCS and NASS data for regulatory purposes. There have also been attempts by non-governmental organizations to secure farm and ranch data from FSA and APHIS. Farm Bureau strongly supports establishment of statutory authority that protects the confidentiality of all the data collected by USDA on individual farms and ranches. Thank you.
Mr. LUCAS of Oklahoma. Thank you. And I would like to note that the Livestock and Crop Coalition witnesses have representatives present from each of their member organizations. Therefore, if subcommittee members have a question to direct towards a particular organization within one of the coalitions, someone may be able to answer that—for that particular organization and we would simply ask that they approach the witness table to answer the question and state their name and organization for the record so that we may all know who is speaking. Gentlemen, looking at a number of the things that have gone on in conservation in this farm bill and in previous farm bills, I would like to touch on a variety of areas. One of the comments that occasionally come up in my town meetings in my small towns and particular in the countryside is that CRP has had the effect of depopulating the countryside. And that there is some occasional concern among others that a Grazing Land Initiative along the same line might have unintended consequences on the way rural America is put together. To the whole panel, I ask you, do you think there is any validity in the comment that CRP has helped to depopulate the countryside or change the social fabric? And if so, for what reason or why not?
Mr. WILLEY. Well, I think CRP has had an effect in reducing economic activity in an area that is somewhat mitigated by the fact that there is a 25 percent cap in every county. So that does much of the problem at that point. I would not think the Grazing Land Initiative would have that problem. In fact, I would think a Grazing Land Initiative would bring economic activity back to the community, put that land to a higher and better conservation use and keep economic community in the area.
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Mr. LUCAS of Oklahoma. Some people offer the theory that CRP has been a challenge for beginning farmers and expanding farmers because it might have an effect on the price of land. And along that same argument, they pitch that a Grazing Land Initiative would have a direct impact on the price of range land out on the countryside, too. Any observations or thoughts about that from anybody on the panel?
Mr. WILLEY. Yes. And that is probably a correct observation. CRP is another use for the land, so it will raise either the land value or the rents. On the other hand, the Grazing Initiative would give more opportunities to young people because you need labor to run a grazing operation. And they would have a better advantage in that respect.
Mr. LUCAS of Oklahoma. But is it possible that we would see the first batches of land sales after the initiation of such a program increase to reflect whatever the payment would be?
Mr. WILLEY. You might have some affect on that, but frankly, I think in many rural areas, one of the real problems is the lack of economic activity, the lack of the job market, people moving away. If you can increase that economic activity in that area through a grazing and a livestock value added, I think it would be very positive effect on the community.
Mr. LUCAS of Oklahoma. There are others who say in my town meetings across the district that the way we have traditionally targeted cost-share towards conservation programs tends to encourage the producers either who in past times have not practiced good habits or discourages good producers who might be willing to do things, but because they have had a better system of practices down through the years, they don't score quite as high on these areas. I guess the question is, to the whole panel, is there any validity in that from your perspective and should, as some concepts have been bounced around in Congress in recent months, should all producers be accessible to conservation dollars without regard to prioritizing?
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Mr. HORAN. The short answer, Mr. Chairman, is yes. There are some discouraged producers out there that have been doing conservation activities on their farms and now, almost feel penalized for it. Some of the first people that signed up for filter strips took a payment that is considerably lower than what is being paid today, not counting the bonus payments that are paid today for johnny-come-latelys, that maybe weren't quite as interested in protecting their land the way some of the first enrollees were. I would like to back up, though, your first question, Mr. Chairman, you talked about CRP depopulating, changing the social structure of the countryside. That was true a few years ago in the original whole farm CRPs. I think it is less true today. And that is why in my statement, we are more interested in targeting the more sensitive areas for CRP, not whole farm signups like we have had in the past. I have had the opportunity the last couple of years to go twice to what is called the New Frontier in Brazil and see how they are getting ready to cover us up with commodity grains down there. I think we are going to be paying for many years, it is sort of the penalty for the large set asides that we have had in the past. All that did was encourage our Brazilian farmers to expand and build infrastructure and get ready to produce more crops. So our organizations are not in favor of whole farm CRPs. If they are damaging, it does cause plywood to go up on Main Street of rural towns in this country. And we think the targeted CRP is the much wiser use of the taxpayers' dollars.
Mr. LUCAS of Oklahoma. Clearly, in any bill that works its way through this Congress, CRP is one of the most popular sections with membership as a whole. And literally, the success in Western Oklahoma such that it is difficult to drive up and down the roads at night trying to avoid the deer and the turkey and all the other wildlife out on the move. With that, thank you, gentlemen. I turn to the ranking member.
Mr. HILLIARD. Thank you very much. Gentlemen, I have four questions for you. One, to each one of you, individually. But the first one is to the entire panel. And if you would, we will start with Mr. Willey and answer as succinctly as possible. Do your organizations have an opinion on the use of priority areas in determining where financial and technical assistance is provided? And I would like for each one of you to answer that.
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Mr. WILLEY. Our priority of the livestock people would be in the area where AFO, CAFO regulations, proposed regulations, current regulations require immediate expenditure, so we would prioritize in that respect.
Mr. HORAN. Our position is that we have some difficulty in some areas with all of the money going to a particular targeted area, which leaves everyone else without funding to do projects. We need a system of prioritization for these projects. And some geographic distribution.
Mr. LINCOLN. And in my testimony and the American Farm Bureau's written statement, I only speak to the need to having bill availability to all participants. Most of these issues are not, well, they are more geographically self-priority. In New York, for example, there has been a lot of prioritization into the watersheds. The AFO, CAFO issue is not a geographic issue. It is—and many times the best places for livestock sector may not be in that particular watershed. You need to be available to all participants.
Mr. HILLIARD. And as each one of you know, under the Conservation Program, Erie County was assured of some level of funding. Each one of you seem to be against that. Am I right? If you prioritize them and if counties are left out, does that suit you?
Mr. LINCOLN. I don't think that is what we are saying at all. I mean, no. I mean, what we are saying is that fielding assistance and the technical assistance needs to be available.If I am a dairy farmer, no matter where I am located in New York, whether I am out priority, watershed or whether I am not. And I think that is what I was referring to as priorities.
Mr. HILLIARD. OK.
Mr. LINCOLN. We need to have these available. So I would include all no matter what county I am in.
Mr. HILLIARD. I understand.
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Mr. HORAN. Part of the frustration is that in my case, in particular, we occasionally put terraces in. I can put terraces in whether I work through a cost-share program or do it on my own with the same contractor for the same dollars. And the reason I can is that if I just go to the contractor, tell him where I need a terrace, tell him to go build it, he will charge me the same amount. He will charge double if it goes through the cost-share program. FSA. And the reason that is, is that he has to spend too much time meeting with the technicians. He may be 20 or 30 miles across the county on another project. He has to drive back to meet with the technicians to finalize paperwork, to get approvals. Somebody is paying for that. In our particular area of the world, we could get twice as many terraces built for the same dollars if you had something like a Certified Technician that could just go out and do it and just be spot checked from time to time.
Mr. HILLIARD. Well, let me ask Mr. Willey and Mr. Lincoln the same question. There is no doubt that we have to utilize third parties to assist land owners and operators. Do you have thought about where the priorities should be between assuring that the work force and the NRCS is adequate versus relying on these third parties?
Mr. LINCOLN. If I can start out, New York was mentioned as one of the States where there has been some of that cooperation.
Mr. HILLIARD. Are you seeing results? Quick results?
Mr. LINCOLN. Yes. And favorable results. Because we were one of the first States to have to comply into the bill, the CAFO issue and we had set up a program with our Department of Environmental Conservation. So we have the certified crop advisors, certified planners. That is the only way that we could meet the needs of reaching the goals that was established in this case by our Department of Conservation. Because we just did not have enough technicians there through NRCS. But I think we need funding through NRCS and we also need the third party availability. We need both.
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Mr. WILLEY. In a good part of the country, there just hasn't been enough use of independent contractors to have any idea whether they are successful or not. One problem you would have is that would have to have some time period for those people to get up to speed because in many parts of the country, I know in Iowa, we simply don't have a cauldrary of good, qualified people to just step in and start doing that work.
Mr. HILLIARD. Let me ask Mr. Lincoln a question. Have you been in a position to see any differences in cost between the NRC workers and your workers, I'm sorry, and third party workers, the certified ones?
Mr. LINCOLN. I really can't comment on that. But the additional information, I guess, on the bill, the certified, the point that was made that does take some time to develop those. The process we are using in New York is they have to actually go out to where the assistance from either NRCS or others to develop some plans and it is only after that they become certified. But it can be accomplished in a relatively short time, but no, I guess I wouldn't comment on the difference in cost.
Mr. HILLIARD. Thank you very much. Let me just move to another subject for a minute. Mr. Horan, can you give us some explanation of why the Crop Coalition does not see a need to increase the acreage in WRP?
Mr. HORAN. Well, we know that we are dealing with limited resources, limited funds. And we think that there is a better target for those if we use those kinds of funds to encourage no till incentive programs to encourage different types of practices that will impact clean air, clean water faster than some of the set aside programs.
Mr. HILLIARD. Quickly, Mr. Lincoln, does the Farm Bureau have a position on the future of WRP?
Mr. LINCOLN. On the future of WRP?
Mr. HILLIARD. Yes.
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Mr. LINCOLN. We have prioritized and with our list here of what we feel again we have been split—having conversation about the budget limitations, though our list prioritizes, that doesn't mean that we don't support the concepts on those other programs we haven't mentioned, like the——
Mr. HILLIARD. Is that the end of the list? Is that what you are telling us?
Mr. LINCOLN. Yes.
Mr. HILLIARD. Thank you very much.
Mr. LUCAS of Oklahoma. Mr. Thune.
Mr. THUNE. Thank you, Mr. Chairman and thank you, panel. Just a question on if you look at the amount that has been put in the budget for addressing the farm bill needs and the next bill and there is the baseline number and then there is the additional dollars that are made available. And just for purposes of rounding, we will say it is about $70 billion. How much of that, in your mind, ought to be dedicated to conservation type initiatives, as opposed to my—most of you—some of you already testified in favor of changes in the farm bill that would require, obviously, additional funding for the commodity section of the program. How much would we be looking at in terms of what we ought to do for conservation?
Mr. HORAN. Well, I am not sure I am prepared to put a price tag on it. But I will tell you, as a producer, my interest would be programs that allow me to become more efficient, more productive and be better able to compete in the global economy. And an example would be being able to mitigate a small wetland the size of this room with low utility to something with high utility, then I can go ahead and fix this small spot program that is only wet maybe 10 days out of the year. And that makes me more productive, more efficient in that field. I can go right through that spot and farm it and grow something on it. That makes me more competitive in the global markets. And I would hope that policymakers would focus on the types of programs for conservation that would also help productivity. Because it is very, very competitive, as you know, in that global market.
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Mr. THUNE. Understood. Any of the others care to say something?
Mr. HORAN. Well, we talked about $1.2 billion on a yearly basis. $12.2 billion over 10 years. Just off-hand, I would say about one-quarter to one-third ought to go to conservation programs.
Mr. THUNE. Good. Mr. Lincoln?
Mr. LINCOLN. Well, our number is still the $3 billion to and I, just to further expand a bit on and agree with what has been said. But I think it is an opportunity to reach out to the environmental payments, or green payments for assistance and to some of the nontraditional grow crop payments to specialty crops and then they also contribute to the environment and things like that. So I think there is an opportunity to use it and as that mechanism.
Mr. THUNE. Three billion dollars annually?
Mr. LINCOLN. Annual.
Mr. THUNE. As a follow-up to that, what do you all see as the next step in terms of conservation of the farm bill? I mean, I am looking at your testimony and, for example, the Crop Coalition made reference to contemplating financial assistance for conservation practices on resources and management that support production and generate environmental benefits. And that ties in with what you answered. You just answered your last question, Mr. Horan. And that is that you want to see things that enhance production. I think that makes a lot of sense and there are similar statement in Farm Bureau about voluntary public benefits, creating and maintain environmental practices, flexible contracts, those sorts of things. What is the next iteration of conservation of the farm bill?
Mr. HORAN. Well, I think continuation upon some of the things that we have seen successful in the past. And specifically, incentive based payments to help a producer convert and cover the risk of changing a farming practice like minimum till to no till. There is educational component. There is a financial component. There is a risk component. It would be great if the next farm bill could address some of those components and help transform our grandfathers' agriculture into a 21st century conservation agriculture.
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Mr. THUNE. Anybody else care to comment or two?
Mr. LINCOLN. Two things I will comment on. The EQIP Program that we had mentioned, I think you need to make some changes there so it does better accommodate today's agriculture and the future of agriculture. On the regulatory costs is something that American agriculture, whether you are a livestock producer or a crop producer or specialty crops, it has a tremendous impact, as I mentioned in our statement on the industry. One of the one of the effects of regulations—and I operate a dairy farm. We have the next generation coming in. As it forces the industry the family farm to be larger to comply with the regulations cost per cow and things like that go down somewhat. The larger the operation there is. So I think you need to have the adequate cost-sharing programs, the technical assistance under programs like EQIP. I know in our discussion on our American Farm Bureau Board of Directors and back home in New York, I think moving towards the so-called environmental, the green payments, is another way to better serve American agriculture, the changing needs, the flexibility and also compliance as far as the WTO agreements.
Mr. THUNE. Thank you. I yield back, Mr. Chairman.
Mr. LUCAS of Oklahoma. Mr. Putnam.
Mr. PUTNAM. Thank you, Mr. Chairman. Mr. Lincoln, you have had a couple of long days of testimony. I will be you are ready to get back to the farm.
Mr. LINCOLN. Yes.
Mr. PUTNAM. In the discussions that American Farm Bureau went through, what is your organization's consensus on the flexibility that should be given to States, in terms of implementation of these programs, even flexibility right down to the county level? And what are some recommendations to improve that, if that is a priority of yours?
Mr. LINCOLN. I think, in fairness we have had some discussion, but we haven't had a lot. Certainly, we support the local initiative and things. But we can get back to you with a better answer to your question. And we had some discussion, but I don't want to——
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Mr. PUTNAM. Was there any discussion about whether or not funding should be based on the value of farm production, rather than the number of farms in the State?
Mr. LINCOLN. Yes. We haven't had that particular discussion, at least, at a board level. And some individuals may have had that. But not officially as an organization.
Mr. PUTNAM. As we move into the discussion about modernizing these programs and bringing agriculture into the 21st century and we talk about the social benefits that are derived from environmental stewardship, the water recharge areas and the carbon sequestration and things of that sort. How are we going to quantify those so that we can go to some of our colleagues who aren't necessarily from rural areas and aren't from agricultural areas and give them the science-based number of the social benefit that is derived from producers engaging in these techniques? Anyone.
Mr. HORAN. Well, one of the things that got us pretty excited a couple of years ago was we had a local insurance company in Iowa that had contracted with two power generating companies in Canada to sequester their carbon in Iowa cornfields. And as the discussions moved along, we were talking about a number something like $7 an acre that farmers would be paid for sequestrating that carbon. Suddenly, there were all sorts of numbers about tons of carbon that were actually being sequestered. Exactly what you are getting at. And so the last information that I read about that was the National Academy of Sciences was trying to figure out, on a cornfield that was yielding a certain number of bushels, how much carbon that actually sequestered. I think that research is being done. I think we are going to come up with some hard numbers at some point. We don't have them today. 2 years later, we are still not being paid for sequestering that carbon because we don't have those hard numbers. That would be very useful if we could get those numbers.
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Mr. LINCOLN. From a Farm Bureau standpoint, I think that is very much the case. We need some research that needs to be quantified. Some better research. However, some factors may be very hard to quantify like the value of the landscape to the public and some of those more tangible things. But I think there are things we can and there is research being done. We just need to pull some of that together, quantify some of it and have, maybe, perhaps, more research in other places. Better information.
Mr. PUTNAM. Yes, sir.
Mr. WILLEY. Well, the good extent, good conservation is in the eye of the beholder. And agriculture, for one, is going to have to do a better job of educating the general public as to the progress that they have made and that they intend to make. But in particular, where we are dealing with the EQIP Program, we could point to greater compliance with current environmental regulations laws and say we have this percentage of additional compliance with the law, therefore, less pollution and more valuable use and more positive use of nutrients.
Mr. PUTNAM. What are your thoughts on leveraging Federal dollars to match programs that are already going on in the States, and I know some States are way up front on this. Florida has a pretty innovative TMDL Program that we are working on and around Lake Okeechobee. Do you think that preference should be given to States which have developed their own programs and incentives?
Mr. WILLEY. Well, our whole approach is a voluntary, incentive-based program. Where the farm owner, the land owner and/or operator have a commitment of financial commitment and stake in that particular practice. Certainly, anything that the State would do or any other local Government, would be a positive factor there. And I think that contribution ought to be encouraged and recognized.
Mr. HORAN. If there were Federal dollars available for a cost-share situation like that, I think that would be a huge driver for States to go ahead and develop a program there very quickly and take advantage of those dollars.
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Mr. LINCOLN. And, again, I think, you have to look at it proposal by proposal and certainly the concept probably is something that could be taken a look at.
Mr. PUTNAM. Thank you, Mr. Chairman.
Mr. LUCAS of Oklahoma. Thank you, Mr. Putnam. One last question, Mr. Willey. In your testimony, you mentioned the potential cost of upwards of $12 billion over the next 10 years to meet the mandatory standards. Food chain tends to be a situation where costs rarely go down because of World competition. Costs tend to revert back to the source. If these needs aren't addressed, what would be the impact do you think on the livestock industry in this country?
Mr. WILLEY. Well, I think that money would have to come out of the farmer's pocket.
Mr. PUTNAM. Mr. Chairman?
Mr. LUCAS of Oklahoma. Mr. Putnam.
Mr. PUTNAM. Based on the testimony, it sounds like it would be a whole lot cheaper just to repeal the TMDO rule than to fund all the requirements to abide by it.
Mr. LUCAS of Oklahoma. You are an exceedingly practical freshman, but sometimes, challenges are a bit great. And with that note, let me note that when you consider the money that has to be set aside to address commodity titles, when you consider the existing needs in conservation and you consider all of the other issues that we have talked about today, perhaps, perhaps, we should be lobbying more extensively on both the Budget Committee and the Appropriations Committee. After all, we are your friends here and we understand the challenges we all face together. But to accomplish what we need to accomplish, we have to pull everyone along with us. And with that, I thank the witnesses for being very tolerant of today's schedule on the floor of the House. And I thank my colleagues, also, and wish to observe that without objection, the record of today's hearing will remain open for 10 days to receive additional information and supplemental written responses from witnesses to any questions posed by a member of the panel. This hearing of the Conservation, Credit, Rural Development and Research subcommittee is adjourned.
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[Whereupon, at 5:39 p.m., the subcommittee was adjourned, subject to the call of the Chair.]
[Material submitted for inclusion in the record follows:]
Statement of John Lincoln
Mr. Chairman, I am John Lincoln, President of the New York Farm Bureau, and a dairy farmer from Ontario County, New York. AFBF represents more than 5 million member families in all 50 states and Puerto Rico. Farm Bureau is looking for, and will be supportive of, the right mix of public policy tools that will enable farmers and ranchers to improve net farm income, enhance their economic opportunity, preserve their property rights and enhance the Nation's environment.
America depends on a strong and sound agricultural policy. American agriculture provides food security for this nation and much of the rest of the world. We contribute to our national economic security by running a positive balance of trade and generating off-farm employment. We also contribute to the world's environmental security. In this specific area we can, with the proper incentives, do much more.
Increased regulatory costs on all levels—Federal, State and local—are placing a heavy burden on individual farmers and ranchers as well as distorting the traditional structure of our industry. Farmers and ranchers understand the importance of protecting the environment. Their livelihood depends on it. However, the expenses that are incurred to meet compliance are taking a heavy toll on farm incomes and forcing farmers and ranchers to spread the cost of increased regulation over more units of production. The unintended consequence is the inability of small- and medium-sized family farms to compete in a highly charged regulatory environment.
Farm Bureau believes there is a need for a new environmental policy framework. We need to move beyond the current debate over whether the public has the right to mandate features and/or farming practices in the rural landscape. We are at that proverbial fork in the road and have concluded that mandates are not only counter-productive but more important, inefficient. Our members understand that there is need for a different set of tools and farm policy options. We believe market forces and government programs can work together to enhance the Nation's productivity and environmental objectives.
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U.S. farmers and ranchers have historically shown that if either market forces or government support prices provide sufficient incentives, such as $3.00 per bushel corn or $4.00 per bushel wheat, we can produce an abundant supply of these commodities. Similarly, if a voluntary incentive is offered for a desirable environmental outcome, farmers will overwhelm America with improved soil conservation, water quality, air quality and wildlife habitats.
In order for a conservation incentive payment program to work well, public policy must recognize the inherent limitations that command and control regulations have in attaining desired public benefits of an environmental nature. Efficient public policy is one where the thing demanded by society is the thing that is being produced.
There is little doubt that we have made strides in improving our environment over the last three decades. By nearly every measure our environment and natural resources are in much better shape than at any time in our lifetimes. As the demand for environmental enhancements increase it is important that we examine the public policy tools that we have at our disposal and determine whether they are appropriate or not. The command and control nature of many of the first generation environmental statutes were enacted for the problems of the 1960's and 1970's. The programs were, and continue to be very controversial and adversarial in nature. Compliance was expensive and inefficient but comparatively easy to measure.
In addition to building on the gains of the last three decades, the public now desires open space, wildlife habitat, scenic vistas, diverse landscapes and recreational activities. These are clearly more ephemeral policy goals that require a more delicate and site-specific policy approach that necessitates the cooperation of the landowner more than ever before. The existing environmental policy framework is not equipped to function in a way that is most efficient in achieving the policy objectives we are faced with in the future. Public policy, and in this case, the conservation title should move beyond preventing bad things to policies of promoting good things. Command and control mechanisms do not provide an attractive incentive for farmers and ranchers to produce the things that the public wants. A new, more efficient and effective approach should be developed to assist farmers and ranchers in providing the public with what it wants. It should be voluntary, provide sufficient economic incentive and clearly define the benefits that society at large derives from agriculture.
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Farmers and ranchers can produce and market more than traditional agricultural commodities. We can also produce and market environmental benefits. Under this concept, agriculture and the government program must come together to create an alternative market for environmental improvements or amenities that the public desires. Such environmental features would likely include erosion control and improved water quality, ecological services such as nutrient filters and carbon sinks, habitat, bio-diverse landscapes, recreational opportunities, and rural amenities, such as visual aesthetics and scenic vistas, to name a few.
Farm Bureau policy states that the next farm bill should:
Continue to improve the environment through expanded incentives to encourage voluntary soil conservation, water and air quality programs, and advance technological and biotechnological procedures that are based on sound science and are economically feasible;
Improve the quality of rural life and increase rural economic development;
Provide for an expansion of the funding baseline in the commodity, specialty crops, livestock, conservation, research, trade and risk management titles;
Continue voluntary participation in a direct payment program that would comply with the green box World Trade Organization requirements; and
Provide willing producers with additional voluntary incentives for adopting and continuing conservation practices to address air and water quality, soil erosion and wildlife habitat.
Bridging the gap between where we are now and where we want to be in the future requires an expanded public investment in agriculture. Part of this public investment directly positions agriculture for renewed growth. Increases in conservation incentives are needed to lay the base today for responsible growth in our industry. We encourage this Committee to consider the following principles as we work together to find the right mix of policy options that will enable farmers and ranchers the opportunity to step up to this new challenge:
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Allow the market to determine the value for these new commodities;
Provide voluntary participants with an annual guaranteed incentive payment, not simply a cost-share or ad hoc payment;
Provide incentives for both implementation and maintenance of conservation and environmental practices - something that has been lacking in the past;
Make incentives available to ALL producers, livestock, poultry, aquaculture, timber, fruit and vegetable producers;
Provide incentives that conform to WTO green box requirements;
Do not replace or disturb any existing or future payment program unless participants choose to opt out of traditional farm programs in return for a higher level of incentives;
Provide program participants the opportunity to improve the quality of rural life and increase rural economic development by providing a stable and diverse presence for agriculture; and
Allow confidential conservation plans to provide an improved level of assurance and accountability of the conservation efforts undertaken by the program participants.
Our vision is to capture the opportunity and efficiencies of providing producers with additional conservation incentives for adopting and continuing conservation practices to address air and water quality, soil erosion and wildlife habitat.
CONSERVATION AND ENVIRONMENTAL PROGRAMS
Conservation Reserve Program (CRP)
Under the CRP producers bid to enroll environmentally sensitive lands into the reserve during signup periods, retiring it from production for 10 years. Successful bidders receive cost-sharing and technical assistance to plant conserving vegetation and annual rental payments.
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Twenty-one signups have been held between 1986 and 2000. There are currently 33.4 million acres enrolled out of the maximum 36.4 million acres provided for in legislation. USDA estimates that average erosion rates on enrolled acres are reduced from 21 tons per acre to less than 2 tons per acre per year.
CRP: (a) provides incentives for reduction in soil erosion, enhancement of water and soil quality, and additional wildlife habitat; and (b) provides a steady income to participants who enroll in the program. In order to ensure that rural and agricultural infrastructure is not hurt by even a slight increase in CRP acreage, we continue to oppose more than 25 percent of the county acreage being included in a CRP contract, Conservation Reserve Enhancement Programs and all experimental pilot projects.
Farm Bureau supports a limited increase in the amount of acreage eligible to be enrolled in the CRP with new acreage targeted toward buffer strips, filter strips, wetlands, or grass waterways should be approved.
Reform Environmental Quality Incentives Program
EQIP does not provide livestock and crop producers the assistance needed to meet current and emerging regulatory requirements. EQIP must be reformed and funding increased in order to assist producers with the cost of meeting Federal, state and local environmental regulations. We support EQIP authority with the following improvements.
We believe that EQIP payments should be available to all livestock producers, no matter their size, and total payments should be limited in a manner comparable to that for row crop producers. The current program does not make EQIP assistance available for the structural components of livestock waste management systems for large livestock operations, defined in most states to be those with more than 1,000 animal units. Excluding large livestock operations from structural assistance ensures that EQIP will never be able to attain its water quality and environmental objectives. This exclusion is entirely inconsistent with a program designed to improve agriculture's environmental performance.
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EQIP should be explicitly amended to direct the Secretary to allocate EQIP dollars to producers for the purpose of helping them meet Federal, state and local mandatory manure management and water and air quality protection requirements. The program should provide the proper assurances that EQIP will result in the highest value possible for the tax dollars spent. But the priority setting approaches must be flexible and allow the Secretary to address all of agricultures' top conservation needs. Some priorities will be best addressed through the adoption of certain conservation practices over a large area of a state or the country. Many of these needs most certainly will not be defined by a geographic scope like a 14 digit watershed. In other situations, producers in a defined geographic area like a watershed will be in need of priority attention. EQIP must be amended to ensure that it can address all of these situations. Certain practices or needs could be of such national or statewide priority that they would be eligible for funding without going through a local bidding process. For example, these practices could include such things as:
Helping producers build, plan and operate nutrient and manure management measures and systems.
Implementing pesticide best management practices (BMPs) known to improve water quality.
EQIP should provide for contracts involving single practices or multiple practices, and contracts that range in length from one to 10 years as appropriate to the conservation issue that needs to be addressed. Existing law provides for 5–10 year contacts.
Avoid any unnecessary duplication in the EQIP application process and conservation planning process so as to minimize the administrative burden and duplication, and diversion of funds from producers to administrative activities.
Appropriate emphasis must be given in EQIP to air quality goals and practices.
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CCC statutory authority currently requires that EQIP payments to a producer cannot begin until the year after a contract is signed. This provision needs to be changed to permit payments to producers in the year a contract is signed.
Program must be amended to ensure that funds can be provided for:
Helping producers improve and computerize their farm decision support environmental data and record-keeping systems;
Helping producers plan and implement agricultural BMPs designed to improve air quality.
Amendments are needed to ensure that producers will be able to get the technical assistance they need to successfully participate in the program.
In addition to ensuring that there USDA-based technical assistance is funded, producers must be able to access and use private sector or non-Federal conservation technical assistance from ''certified'' providers like Certified Crop Advisors, Independent Crop Consultants, conservation district professionals, other qualified persons).
A voucher system or some similar system needs to be established for producers to use to secure non-Federal EQIP planning assistance.
The program should in no way impede producers that want to use their own funds to purchase ''certified'' planning assistance, and the funds producers use for that purpose should apply to their cost share contribution.
These non-Federal technical assistance provisions must be addressed in detail as part of the formal EQIP rulemaking.
Establish a USDA-based program to pay producers or give them vouchers to purchase, from private sector organizations that know and understand agriculture, a certified third party assessment of environmental performance. Again, this must be part of the EQIP formal rulemaking.
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EQIP should maintain current authority to provide funding to all producers including crops, livestock, fruits and vegetables. It would provide 50 percent of funding to livestock and 50 percent to crops.
Livestock producers in several states face, or will soon face, costly environmental regulations as a result of state or Federal law designed to protect water quality. Crop producers in many states are preparing to deal with similar environmental requirements. The Federal regulations under the Clean Water Act include the Total Maximum Daily Load Program (TMDLs) and the new Confined Animal Feeding Operations (CAFOs) permit requirements. Federal regulators are also exploring the possibility of expanding Federal regulation of agriculture under the Clean Air Act. Producers need now, more than ever, Federal financial and technical assistance to help them meet these challenges. In many instances, the new Federal or state requirements will be very costly for producers.
Implementation costs for these types of regulations are significant. NRCS estimates that preparation of a comprehensive nutrient management plan could cost $5,000. Installation of a new pork manure management system would run $50,000 to $100,000 and a nutrient management plan and implementation incentives for a 500-acre corn and soybean operation would require $1,500 to $3,000 per year.
Implementation of a program to provide financial assistance to farmers and ranchers to help them execute unfunded state and Federal regulatory mandates must be approved.
EQIP (a) should be readily accepted since producers are familiar with the EQIP program; (b) would be available to all crop and livestock producers; and (c) would provide compliance assistance to farmers and ranchers with implementation of Federal, state and local environmental laws.
(C) Environmental Incentive Payments
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We support a voluntary environmental program that provides producers with additional conservation options for adopting and continuing conservation practices to address air and water quality, soil erosion and wildlife habitat. This would be a guaranteed payment to participants who implement a voluntary management plan to provide specific public benefits by creating and maintaining environmental practices. The management plan would be a flexible contract, designed and tailored by the participant to meet his or her goals and objectives while also achieving the goals of the program.
We support allowing farmers and ranchers the opportunity to voluntarily participate in a program that provides the public with the environmental features they actually want in agricultural areas. It would also provide participants with an alternative source of income that would, in some cases, provide an additional safety net. The proposal is based on the concept that farmers and ranchers can produce and market more than traditional agricultural commodities. They can also produce and market what might be called public environmental benefits. Not only would agriculture be able to produce and market food and fiber, it would also be able to produce and market environmental amenities that the public desires.
Examples include erosion control and improved water quality, ecological services such as nutrient filters and carbon sinks, habitat, bio-diverse landscapes and recreational opportunities, and rural amenities such as visual aesthetics and scenic vistas.
We believe participants should be given the opportunity and flexibility to develop a management plan that provides environmental benefits but, without land retirements or easements, to provide environmental benefits in return for a payment. The length of the contract period would be flexible and tailored to meet the participant's situation. Practices covered under such a proposal could range from accepted good farming practices already implemented on the farm to establishment of a comprehensive environmental management plan.
A management plan and any information resulting from it would be confidential, and the property of the producer. If any incidental or minor regulatory noncompliance within the scope of the management plan is discovered in the course of plan development, the producer should have a grace period of one year to get in compliance without being liable for penalties. Producers who are in good faith compliance with their management plans, but through no fault of their own become non-compliant with environmental regulations, would have one year to correct the noncompliance without being liable for civil or criminal penalties.
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This concept would provide (a) incentives to all agricultural producers; (b) participants with an annual guaranteed per acre incentive payment; (c) incentives for not only implementation, but maintenance of conservation and environmental practices; and (d) an opportunity to provide family farms additional financial assistance beyond current programs.
Implementation of an environmental incentives program should be adopted.
FUNDING FOR CONSERVATION INCENTIVE PROGRAMS
All three of the conservation initiatives would be classified as green box and increase government expenditures $3 billion annually.
Other Conservation Programs
Other conservation programs supported by Farm Bureau are the Farmland Protection Program (FPP) and the Grazing Lands Conservation Initiative (GLCI). These programs were authorized in the 1996 farm bill and are funded through an annual appropriation.
FPP—Farm Bureau supports funding for FPP. This program has been popular in many states. Farm Bureau does not support non-profit organization eligibility for Federal funding to carry out the acquisition of development right easements under this program. Additionally, we oppose the imposition of any farm management plan on the property. The intent of the FPP is to avoid development pressures, not dictate farming practices.
GLCI—The GLCI is a program providing additional technical assistance through NRCS for range and pasture management. We support the continuation of this program.
Confidentiality
Confidentiality of USDA information has become an increasing concern and priority for farmers and ranchers. We have seen attempts by other government agencies to secure NRCS and NASS data for regulatory purposes. There have also been attempts by non-governmental organizations to secure farm and ranch data from FSA and APHIS. Farm Bureau strongly supports establishment of statutory authority that protects the confidentiality of all data collected by USDA on individual farms and ranches.
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Swampbuster. Related to wetland, our challenge has been and continues to be the construction of a coherent national policy that protects both the rights of property owners and our Nation's wetland resources. We believe such a policy exists within the amendments made to the Swampbuster Title of the 1996 farm bill. The key to success is flexibility for farmers and ranchers to modify their operations to gain needed economic efficiencies while also encouraging wetland enhancement and protection. By providing agriculture with the opportunity and flexibility to enhance both wetland resources and agricultural production we can truly have a win/win wetlands policy.
Mr. Chairman, we sincerely appreciate the opportunities to share our views on changes necessary in the next few years to inspire a healthy agricultural sector. We have attached to our testimony the Farm Bureau response to the chairman's earlier questions relating to the conservation title of the farm bill.
STATEMENT OF THE AMERICAN FARM BUREAU FEDERATION TO THE HOUSE AGRICULTURE COMMITTEE REGARDING THE CONSERVATION TITLE
OF THE
NEXT FARM BILL
April 25, 2001
The American Farm Bureau Federation appreciates the opportunity to respond to the committee and believes our response to the following questions will help assure the committee of the need for a strong conservation title. Agriculture is looking for, and will be supportive of, the right mix of public policy tools that will enable farmers and ranchers to improve net farm income, enhance their economic opportunity, preserve their property rights and enhance the nation's environment. American agriculture not only provides food security for this nation and much of the rest of the world, but we also contribute to the world's environmental security. In this specific area we can, with the proper incentives, do much more.
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Question 1(a). Is the NRCS operating the Conservation programs for which it is primarily responsible (EQIP, WRP, WHIP, FPP, Conservation of Private Grazing Land etc.) in an effective and efficient manner?
Programs, whether voluntary and incentive-based or regulatory in nature, are not self-implementing, therefore we believe there is a need for a significant increase in technical resources for timely implementation of the nation's conservation priorities. Each farm and ranch in this country needs access to information and technical assistance. Although there are NRCS resources to assist farmers both technically and monetarily, these resources are inadequate to meet agriculture's most basic needs.
Recommendation: Farm Bureau supports increased funding for voluntary incentive-based programs and NRCS technical assistance.
Question 1(b). What changes should NRCS make to its program and operating procedures?
The role of NRCS should be that of providing technical assistance and education. NRCS should not become a regulatory agency, serve in a policing capacity or be combined through any reorganization with an agency that has regulatory functions. NRCS should not negotiate or become party to any Memorandums of Agreements or Memorandums of Understanding with Federal regulatory agencies that would give NRCS the power to develop, implement, or police those agencies' regulation on agricultural lands.
Recommendation: Farm Bureau believes NRCS should not become a regulatory agency but should function as a non-regulatory mediator of environmental compliance issues with regulatory agencies, on behalf of producers.
Question 2(a). Is the FSA operating the Conservation programs for which it is primarily responsible (FSA, etc.) in an effective and efficient manner?
Recommendation: We support the current system by which FSA carries out programs in conjunction with NRCS.
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Question 2(b). What changes should FSA make to its program and operating procedures?
Recommendation: We continue to support funding for conservation programs being administered by FSA.
Question 3. Please list in order of priority (highest to lowest) each Conservation Program your organization supports. Please include the amount of authorized and appropriated monies your organization supports along with the amount of acres that should be allowed into each program. (All current programs and those being considered) Please include any recommended changes to these programs that could be helpful through both statutory changes and regulatory changes.
The AFBF testified before the committee on February 28, 2001, on the need for at least $12 billion of new budget baseline to adequately provide for a rewrite of the farm bill, including the conservation title. If at least $12 billion is available, then the following programs should be funded. While we have, as requested, ranked our requests, the AFBF Board has not officially taken action as to their priority. The board will consider this issue at their June meeting and will base their decision on the budget resolution conference report passed by Congress.
Overall Conservation Funding Recommendation: We support increasing conservation expenditures above current baseline levels by $3 billion annually for the above programs.
Priority #1 - Reform Environmental Quality Incentives Program
EQIP does not provide livestock and crop producers the assistance needed to meet current and emerging regulatory requirements. EQIP must be reformed and funding increased in order to assist producers with the cost of meeting Federal, state and local environmental regulations. We support EQIP authority with improvements in the program to:
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Eliminate statutory language that prevents operators of larger farms from being eligible for cost-share;
Provide broader third-party technical assistance authority, which would allow farmers to hire consultants to provide technical assistance;
Eliminate priority areas which would allow all producers regardless of location to participate in program; and
Simplify program participation requirements.
EQIP should maintain current authority to provide funding to all producers including crops, livestock, fruits and vegetables. It should continue to provide 50 percent of funding to livestock.
Livestock producers in several states face, or will soon face, costly environmental regulations as a result of state or Federal law designed to protect water quality. Crop producers in many states are preparing to deal with similar environmental requirements. The Federal regulations under the Clean Water Act include the Total Maximum Daily Load Program (TMDLs) and the new Confined Animal Feeding Operations (CAFOs) permit requirements. Federal regulators are also exploring the possibility of expanding Federal regulation of agriculture under the Clean Air Act. Producers need now, more than ever, Federal financial and technical assistance to help them meet these challenges. In many instances, the new Federal or state requirements will be very costly for producers.
We support an EQIP proposal that would authorize payments to:
Help producers build, plan and operate nutrient and manure management measures and systems;
Implement pesticide best management practices (BMPs) known to improve water quality;
Help producers improve and computerize their farm decision support data and record-keeping systems;
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Help producers plan and implement agricultural BMPs designed to improve air quality; and
Ensure that producers could get private sector conservation technical assistance that meets NRCS standards and guidance with nutrient, pest and information management.
Recommendation: We support implementation of a program to provide financial assistance to farmers and ranchers to help them execute unfunded state and Federal regulatory mandates. Implementation of EQIP should be authorized at $1.25 billion annually.
Priority #2 - Conservation Reserve Program (CRP)
Under the CRP producers bid to enroll environmentally sensitive lands into the reserve during signup periods, retiring it from production for 10 years. Successful bidders receive cost-sharing and technical assistance to plant conserving vegetation and annual rental payments.
Twenty-one signups have been held between 1986 and 2000. There are currently 33.4 million acres enrolled out of the maximum 36.4 million acres provided for in legislation. USDA estimates that average erosion rates on enrolled acres are reduced from 21 tons per acre to less than 2 tons per acre per year.
CRP: (a) provides incentives for reduction in soil erosion, enhancement of water and soil quality, and additional wildlife habitat; and (b) provides a steady income to participants who enroll in the program. In order to ensure that rural and agricultural infrastructure is not hurt by even a slight increase in CRP acreage, we continue to oppose more than 25 percent of the county acreage being included in a CRP contract, Conservation Reserve Enhancement Programs and all experimental pilot projects.
Recommendation: Farm Bureau supports a limited increase in the amount of acreage eligible to be enrolled in the CRP (38 million acres) with new acreage targeted toward buffer strips, filter strips, wetlands, or grass waterways. CRP funding should be authorized at 38 million acres ($500 million).
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Priority #3 - Environmental Incentive Payments
We support a voluntary environmental program that provides producers with additional conservation options for adopting and continuing conservation practices to address air and water quality, soil erosion and wildlife habitat. This would be a guaranteed payment to participants that implement a voluntary management plan to provide specific public benefits by creating and maintaining environmental practices. The management plan would be a flexible contract, designed and tailored by the participant to meet his or her goals and objectives while also achieving the goals of the program.
We support allowing farmers and ranchers the opportunity to voluntarily participate in a program that provides the public with the environmental features they actually want in agricultural areas. It would also provide participants with an alternative source of income that would, in some cases, provide an additional safety net. The proposal is based on the concept that farmers and ranchers can produce and market more than traditional agricultural commodities. They can also produce and market what might be called public environmental benefits. Not only would agriculture be able to produce and market food and fiber, it would also be able to produce and market environmental amenities that the public desires.
Examples include erosion control and improved water quality, ecological services such as nutrient filters and carbon sinks, habitat, bio-diverse landscapes and recreational opportunities, and rural amenities—visual aesthetics and scenic vistas.
We believe participants should be given the opportunity and flexibility to develop a management plan that provides environmental benefits but, without land retirements or easements, to provide environmental benefits in return for a payment. The length of the contract period would be flexible and tailored to meet the participant's situation. Practices covered under such a proposal could range from accepted good farming practices already implemented on the farm to establishment of a comprehensive environmental management plan.
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A management plan and any information resulting from it would be confidential, and the property of the producer. If any incidental or minor regulatory noncompliance within the scope of the management plan is discovered in the course of plan development, the producer should have a grace period of one year to get in compliance without being liable for penalties. Producers who are in good faith compliance with their management plans, but through no fault of their own become non-compliant with environmental regulations, would have one year to correct the noncompliance without being liable for civil or criminal penalties.
This concept would provide (a) incentives to all agricultural producers; (b) participants with an annual guaranteed incentive payment; (c) incentives not only for implementation, but maintenance of conservation and environmental practices; and (d) an opportunity to provide family farms additional financial support beyond current programs.
Recommendation: Implementation of an environmental incentives program should be authorized at $1.25 billion annually.
Priority #4 Confidentiality
Confidentiality of USDA information has become an increasing concern and priority for farmers and ranchers. We have seen attempts by other government agencies to secure NRCS and NASS data for regulatory purposes. There have also been attempts by non-governmental organizations to secure farm and ranch data from FSA and APHIS.
Recommendation: Farm Bureau supports establishment of statutory authority that protects the confidentiality of all data collected by USDA on individual farms and ranches.
Priority #5 Grazing Lands Conservation Initiative (GLCI)
GLCI—The GLCI is a program providing additional technical assistance through NRCS for range and pasture management. This has been a very popular program and has accomplished a great deal in resource conservation with relatively little funding.
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Recommendation: We support the continuation of this program.
Priority #6 Air Quality Task Force
Due to lawsuits, new interpretations of existing law and new regulations under the Clean Air Act and other statues, agriculture is increasingly being targeted for air quality regulation. Emissions of particulate matter (dust) from field operations and livestock, ammonia and hydrogen sulfide from livestock, and smoke from agricultural burning, have all been identified by either the EPA or in lawsuits, as agricultural sources of air pollution, though these emissions have not been previously addressed under the CAA. Farm groups are pursuing the need for sound science to identify agriculture's true emission of these pollutants prior to any regulation.
Recommendation: We support the inclusion of the Sec. 391 of the current FAIR Act. This language should remain in the new farm bill. One addition should be made. Under Sec. 391, part (d)(2) the following sentence should be added: ''Task Force members shall serve on the committee according to Federal Advisory Committee Act (FACA) rules, with no limits on the number of terms they serve, as long they are approved by the Secretary.''
Priority #7 Farm Protection Program (FPP)
FPP—This program has been popular in many states. The intent of the FPP is to avoid development pressures, not dictate farming practices
Recommendation: Farm Bureau supports funding for FPP but opposes non-profit organization eligibility for Federal funding for the acquisition of development right easements under this program. Additionally, we oppose the imposition of any farm management plan on the property.
Priority #8 Environmental Conservation Acreage Reserve Program (ECARP)
ECARP is the umbrella program for CRP, WRP and EQIP. ECARP lays out general guidelines for these programs. ECARP changes are necessary to accommodate EQIP recommendations.
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Recommendation: Air quality should be added to the goals and practices encompassed in ECARP. Priority area designation language should be rewritten in such a way as to not favor or discriminate against farmers and ranchers due to their proximity to a geographic area. Priorities should be set based on critical issues, needs and practices.
Priority #9 Forestry Incentive Program (FIP)
Recommendation: Support continuation of the FIP providing cost-share for tree planting.
Question # 4. Do any of the current conservation programs adversely affect your commodity or livestock operations?
Recommendation: As stated above, we believe the following changes are needed in EQIP authority to improve overall program operation:
Eliminate statutory language that prevents operators of larger farms from being eligible for cost-share;
Provide broader third-party technical assistance authority, which would allow farmers to hire consultants to provide technical assistance;
Eliminate priority areas which would allow all producers regardless of location to participate in program; and
Simplify program participation requirements.
Swampbuster. It was the intent of Congress to exclude farmland converted for the production of an agricultural commodity as well as the land where conversion was commenced prior to 1985 from Swampbuster regulation. There have been attempts to erode this exemption over the last several years. Certification language was added to the 1996 farm bill during final conference that weakens the exemption. This language has created considerable confusion regarding the status of prior converted land.
Recommendation: All certification language should be deleted (Sec. 1222, a, reference to certification in (1), all of 3,4,5,6,)
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Swampbuster—Wetlands MOA
Since its inception, the wetlands MOA has been very controversial and ultimately non-operational since 1996. Recent court cases have created further conflicts between CWA 404 and Swampbuster. The delineation process under the MOA never functioned well for farmers and created a significant workload for NRCS. AFBF has requested that NRCS withdraw from the MOA.
Recommendation: The wetland MOA language in Section 325 should be deleted.
Question #5. Why hasn't Section 335, Conservation Farm Option, been used to consolidate program payments from CRP, WRP, and EQIP into one payment?
Section 726 of Public law 106–387, passed by the 106th Congress prohibited funds being made available to pay the salaries and expenses of personnel to carry out a conservation farm option program.
Question #6. Have Sections 351 through Sections 360 establishing the National Natural Resources Conservation Foundation been useful and effective?
No. Report language contained in Public law 104–613 prohibited any use of Federal funds to establish or operate the National Natural Resources Conservation Foundation.
Question #7. Please identify and breakdown costs to producers that are going to be incurred in order to comply with current environmental concerns caused by statute and through regulation. (e.g. CAFO/AFO regulations)
In most cases a professional planner will be needed to develop the type of Comprehensive Nutrient Management Plan (CNMP) envisioned by EPA. These changes will require that farms pay for practices on their own and in most cases hire a professional planner. The cost of these plans varies considerably depending on the existing practices and enterprises, present management, and size of the farm. Developing the plan can take the services of a crop management specialist, an animal nutritionist, an agricultural engineer, a veterinarian, and a financial planner. Information on the soils, watershed concerns, crop yields, animal production, bio-security methods, future goals of the farm, and the financial resources will need to be gathered. These plans, without adequate NRCS resources, will cost from $2,000 to $60,000 for typical farms to develop. NRCS has been and should continue providing these services, however they cannot be expected to provide much help to the large numbers of farms needing this service. NRCS can provide information but will be overwhelmed with the volume of information needed for all livestock farms.
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In the past NRCS was the main source of the designs and construction specifications of these practices (e.g., technical guidelines, best management practices and engineering specifications). Design work for some practices can be quite involved. Protecting a barnyard from off site water sources, and controlling the runoff through sediment basins and filter areas can involve many separate hydrological and hydraulic calculations. Working within the constraints of existing facilities can add considerably to the cost of the design. This design work often exceeds the traditional engineering design fee of 6–10 percent of the total cost of the project. Inspection costs to ensure compliance with standards and specifications can also add greatly to the costs. The typical engineering costs to implement the plans may range from $2,000 to $50,000 per farm.
The best information developed to date on the importance of technical assistance and implementation costs were compiled by the Cornell Cooperative Extension Service. They found the following:
New York City Watershed Agricultural Council has been working since 1995 to develop and implement pollution control plans that will reduce the potential for farms in the watershed to contaminate the surface water sources of New York City's drinking water supply. So far they have completed over 235 plans at an average cost of $10,000 each. This figure is derived from the four-person planning team's goal of two plans per month with a total cost per employee of $60,000 per year. Most farms in the New York City Watershed are smaller than 300 animal units. Most of the farms are challenged with barns and barnyards close to streams. The construction costs of the plans average $75,000 for the NYC watershed farms. Larger farms have construction costs above $1,000,000. Without the full costs of the plan development and construction costs, additional environmental results are questionable. The bottom line: average cost per dairy cow ranges from $1,000 to $2,000 for an average 80-cow dairy.
Skaneateles Lake provides drinking water for the city of Syracuse in upstate New York. The city has also agreed to pay for the plan development and implementation of practices that will protect the lake from agricultural pollution. The Skaneateles Lake Watershed Agricultural Program was developed cooperating with Cornell Cooperative Extension, Natural Resources Conservation Service, and Soil and Water Conservation Districts from the counties involved. So far the average cost of planning and designing the needed practices have been about $30,000 for each farm. The range has been $3,500 for a small one-enterprise farm to $196,000 for a large dairy. Again, the bottom line: average cost per dairy cow ranges from $1,000 to $2,000 for an average 80-cow dairy
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Nationally, farmers need NRCS help in developing these plans and in providing cost-share assistance. EPA has estimated that there are 450,000 Animal Feeding Operations (AFOs) in the U.S. If the average CNMP takes a professional 320 hours to complete, (the time used in the NYC Watershed) and the average professional has 2,000 hours available to develop CNMPs, it will take 7,200 people 10 years to provide this effort. This would not include the time spent in design and construction inspection or the time spent in changing and updating CNMPs.
If the average cost is $50,000 per farm, it will take the current EQIP budget of $200 million at a 50 percent cost share rate 56 years to finance this effort. In this scenario farmers would be providing half the cost of implementation, $11.25 billion. This does not include the cost of maintenance or additional operating costs. Farms will also be impacted by the activities in the Mississippi River Basin to address the seasonal hypoxic zone in the Gulf of Mexico and by activities in the Everglades.
Recommendation: Farm Bureau supports a significant increase in funding for voluntary incentive-based programs and NRCS technical assistance to assist producers with the cost of Federal, state and local regulatory requirements.
Question #8. Is the Conservation Security Act intended to replace existing Conservation and Commodity programs or to coexist with those currently being administered?
We believe the ''Conservation Security Act-type program'' should coexist with and complement current conservation and commodity programs. The conservation title should:
Continue to improve the environment through expanded incentives to encourage voluntary soil conservation, water and air quality programs, and advance technological and biotechnological procedures that are based on sound science and are economically feasible;
Provide willing producers with additional voluntary incentives for adopting and continuing conservation practices to address air and water quality, soil erosion and wildlife habitat.
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Increased regulatory costs on all levels—Federal, state and local—are placing a heavy burden on individual farmers and ranchers as well as distorting the traditional structure of our industry. Farmers and ranchers understand the importance of protecting the environment. Their livelihood depends on it. However, the expenses that are incurred to meet compliance are taking a heavy toll on farm incomes and forcing farmers and ranchers to spread the cost of increased regulation over more units of production. The unintended consequence is the inability of small and medium sized family farms to compete in a highly charged regulatory environment.
We believe there is a need for a new environmental policy framework. A policy that provides an opportunity for farmers and ranchers and the public to move beyond the current debate over whether the public has the right to mandate features and/or farming practices in the rural landscape.
U.S. farmers and ranchers have historically shown that if either market forces or government support prices provide sufficient incentives, such as $3.00 per bushel corn or $4.00 per bushel wheat, we can produce an abundant supply of these commodities. Similarly, if a voluntary incentive is offered for a desirable environmental outcome, farmers will overwhelm America with improved soil conservation, water quality, air quality and wildlife habitats.
In order for a conservation incentive payment program to work well, public policy must recognize the inherent limitations ''command and control'' regulations have in acquiring desired public benefits of an environmental nature. Efficient public policy is one where the thing demanded by society is the thing that is being produced. ''Command and control'' forms of environmental laws have run their course.
There is little doubt that we have made strides in improving our environment over the last three decades. By nearly every measure our environment and natural resources are in much better shape than at any time in our lifetimes. As the demand for environmental enhancements increase it is important that we examine the public policy tools that we have at our disposal and determine whether they are appropriate or not. The command and control nature of many of the first-generation environmental statutes were for the problems of the 1960's and 1970's. The programs were, and continue to be very controversial and adversarial in nature. Compliance was expensive and inefficient but comparatively easy to measure.
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In addition to building on the gains of the last three decades, the public now desires open space, wildlife habitat, scenic vistas, diverse landscapes and recreational activities. These are clearly more ephemeral policy goals that require a more delicate and site-specific policy approach. The existing environmental policy framework is not equipped to function in a way that is most efficient in achieving the policy objectives we are faced with in the future. Public policy, and in this case, the conservation title should move beyond preventing bad things to policies of promoting good things. ''Command and control'' mechanisms do not provide an attractive incentive for farmers and ranchers to produce the things that the public wants. A new, more efficient and effective approach should be developed to assist farmers and ranchers in providing the public with what it wants. It should be voluntary, provide sufficient economic incentive and clearly define the benefits that society at large derives from agriculture.
Farmers and ranchers can produce and market more than traditional agricultural commodities. We can also produce and market environmental benefits. Agriculture and the government can work together to create an alternative market for environmental improvements or amenities that the public desires. Such environmental features may include erosion control and improved water quality, ecological services such as nutrient filters and carbon sinks, habitat, bio-diverse landscapes and recreational opportunities; and rural amenities—visual aesthetics and scenic vistas to name a few.
Recommendation: We encourage the Committee to work with us to find the right mix of policy options that will:
Allow the market to determine the value for these new ''environmental commodities;
Provide voluntary participants with an annual guaranteed incentive payment and/or additional cost share;
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Make incentives available to ALL producers;
Does not replace or disturb any existing or future payment program unless participants choose to opt out of traditional farm programs; and
Allows confidential conservation plans to provide an improved level of assurance and accountability of the conservation efforts undertaken by the program participants.
We believe such a program would provide incentives for both implementation and maintenance of conservation and environmental practices and give the public an easy to understand argument for expanding the agricultural entitlement baseline. It would also provide incentives to producers that conform to WTO green box requirements and provide program participants the opportunity to improve the quality of rural life and increase rural economic development by providing a stable and diverse presence for agriculture. The bottom line is we believe this committee has an opportunity to capture the win/win efficiencies of providing producers with additional conservation incentives for adopting and continuing conservation practices to address air and water quality, soil erosion and wildlife habitat.
Statement of Thomas A. Weber
Mr. Chairman and members of the committee. Thank you for the opportunity to appear today and provide an update on the Conservation Programs implemented by the USDA Natural Resources Conservation Service (NRCS).
Mr. Chairman, as you know, farmers across America are faced with ever increasing pressures to maintain productive and profitable businesses. Prices for many farm commodities have been the lowest in years and poor weather and growing conditions have been issues in many areas. Production costs have increased due to many factors including rising prices of nitrogen fertilizer and natural gas. In addition to these concerns, farmers face increasing pressures associated with natural resources. In recent years, concern regarding the health of our soils, water supply, and air has made farming and ranching increasingly difficult.
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We know that farmers want to be good stewards of the land. They know that stewardship is in the best interests of long-term productivity of their farming operations. And by and large, it is also important to farmers and ranchers who want to leave improved natural resources and a better environment for future generations. Our mission is to help farmers and ranchers meet the challenge of sustaining their natural resources while maintaining a productive and profitable business.
Today, I would like to highlight the many ways our conservation programs are making a difference around the countryside. Since the enactment of the Federal Agriculture Improvement and Reform Act of 1996 (1996 Act), NRCS has experienced an increased national demand for participation in conservation programs. Farmers are utilizing these programs for a variety of benefits, including managing nutrients to save on input costs and protect water quality, restoring and protecting wetlands to create wildlife habitat, installing grassed waterways to control erosion, and implementing systems to increase forage production and manage invasive species.
Farmers and ranchers are using conservation to improve the productivity and sustainability of their operation, while also improving the asset value of their operation. Our programs are voluntary. In response to new environmental regulations at many levels, we are helping farmers and ranchers meet some of the regulatory pressures they face. In turn conservation programs provide public benefits that go well beyond the edge of the ranch or farm field. Mr. Chairman, I believe that conservation programs the Congress included in the 1996 Act, when coupled with our historic conservation programs, and the state and local delivery system are proven winners for the farmer, and the country as a whole.
CONSERVATION TECHNICAL ASSISTANCE
The cornerstones of our conservation activities are the NRCS workforce and our partnerships. Everything we accomplish is contingent upon the talents and technical skills of our field staff around the country. They are trained professionals with the technical tools, standards and specifications to get the job done. NRCS has operated since its creation through voluntary cooperative partnerships with individuals, conservation districts, state and local governments, and other Federal agencies and officials. That partnership may be even more important today if we are to meet the challenging conservation problems facing our Nation's farmers and ranchers.
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While we are accomplishing much through the 1996 Act programs, it is important not to lose sight of the importance of our ongoing Conservation Technical Assistance program. For more than 60 years, the NRCS has used conservation technical assistance to build a foundation of trust with people who voluntarily conserve their natural resources. Each year, the NRCS provides information, education, planning, and/or implementation assistance to more than 1 million land users. On average, the Agency's conservation assistance leverages more than $1 in contributions for every Federal dollar invested. And through the National Cooperative Soil Survey, approximately, 22,000,000 acres have been mapped each year, so that natural resource decisions are based upon the best information available.
NRCS accomplishes its goals by working with 3,000 local Conservation Districts that have been established by state law and with American Indian Tribes and Alaska Native Governments. We also leverage our resources with the help of more than 348 Resource Conservation and Development (RC&D) Councils. State and local governments contribute substantially, with both people and funding to complement NRCS technical and financial assistance. Approximately 7,750 full time equivalent staff years are provided annually by NRCS partners and volunteers.
WETLANDS RESERVE PROGRAM (WRP)
Next, I would like to highlight the accomplishments of the Wetlands Reserve Program (WRP). WRP preserves, protects, and restores valuable wetlands mainly on marginal agricultural lands where historic wetland functions and values have been either depleted or substantially diminished. Program delivery emphasizes maximizing wetland wildlife benefits, providing for water quality and flood storage benefits, and providing for general aesthetic and open space needs. Approximately 70 percent the WRP project sites are within areas that are frequently subjected to flooding, reducing the severity of future flood events. WRP is also making a substantial contribution to the restoration of the Nation's migratory bird habitats, especially for waterfowl.
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As directed in the 1996 Act, the enrollment is separated into three components (permanent easements, 30-year easements, and cost-share agreements). Pursuant to appropriations act directives, enrollment is being balanced to respond to the level of landowner interest in each of these three components.
The 1996 Act authorized a total cumulative enrollment of 975,000 acres in the program. At the conclusion of fiscal year 2000, the program had nearly reached maximum enrollment. The Agriculture, Rural Development, Food and Drug Administration, and Related Agencies Appropriations Bill for fiscal year 2001 provided an additional 100,000 acres, raising the cumulative enrollment cap to 1,075,000 acres and allowing 140,000 acres to enroll in fiscal year 2001.
From inception of the program in 1992 through 2000, interest in WRP has been exceptional. Historically, there have been many more acres offered than the program could enroll. One benefit of WRP is the amount of resources we have been able to leverage with other Federal programs as well as non-governmental organizations. It is clear from our experience to date, Mr. Chairman, that the WRP continues to be very popular with farmers and ranchers and is a program that has strong support around the countryside.
WILDLIFE HABITAT INCENTIVES PROGRAM (WHIP)
The Wildlife Habitat Incentives Program (WHIP) provides up to 75 percent cost-share for implementing wildlife habitat practices to develop upland wildlife habitat, wetland wildlife habitat, threatened and endangered species habitat as well as aquatic habitat. WHIP also helps landowners meet their own needs while supporting wildlife habitat development, and to develop new partnerships with State wildlife agencies, nongovernmental agencies and others.
The program was initially funded at a total of $50 million in the 1996 Act. As a result of strong interest in the program, those funds were exhausted at the end of fiscal year 1999, at which time 1.4 million acres were enrolled in 8600 long-term wildlife habitat development agreements. For fiscal year 2001, $12.5 million will be provided for WHIP from funding in section 211(b) of the Agricultural Risk Protection Act of 2000, as authorized in the fiscal year 2001 Consolidated Appropriations Act. NRCS has made an enormous effort to develop partnerships and outreach methods with government and private organizations to develop a program that targets specific state concerns.
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FARMLAND PROTECTION PROGRAM (FPP)
The FPP protects prime or unique farmland, lands of State or local importance, and other productive soils from conversion to nonagricultural uses. It provides matching funds to leverage funds from States, Tribes, or local government entities that have farmland protection programs. The FPP establishes partnerships with State, Tribes, and local government entities to acquire conservation easements or other interests in land. It ensures that valuable farmland is preserved for future generations and also helps maintain a healthy environment and sustainable rural economy. The program was initially funded in the 1996 Act at a level of $35 million. To date, all funds have been expended, and local interest in the program continues to be strong. For fiscal year 2001, additional funding provided in the Agricultural Risk Protection Act of 2000 will fund the FPP at $17.5 million. On January 22, 2001, a request for proposals was published in the Federal Register. Eligible entities had until March 8, 2001 to submit their proposals. After the evaluation process is concluded, successful applicants will be notified in June, 2001.
FORESTRY INCENTIVES PROGRAM (FIP)
To increase timber production, FIP was authorized by Congress in 1978 to share the costs of tree planting, timber stand improvement, and other related practices on nonindustrialized private forest lands. The Federal share of these costs ranges up to 65 percent.
Mr. Chairman, the demand for sawtimber, plywood logs, and quality hardwood logs continues to be strong. To meet the demand for these products, more trees must be planted and more forestland placed under good forest management. FIP is designed to share the expense with eligible, private landowners to produce timber. For the life of the practices, additional environmental benefits accrue including wildlife habitat and carbon sequestration.
Funding for FIP for fiscal year 2001 is $6,325,000. With these funds 4,049 participants were enrolled with forest management plans on 151,015 acres of private forestland. Of this total, 117,026 acres of trees were planted, 23,709 acres of timber stand improvements were accomplished, and 10,230 acres of site preparation for natural regeneration was implemented. We would estimate that since 1975, landowners have established nearly 4 million acres of tree planting and 1.5 million acres of timber stand improvement.
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ENVIRONMENTAL QUALITY INCENTIVES PROGRAM (EQIP)
EQIP provides technical, financial, and educational assistance to farmers and ranchers who face serious threats to soil, water, and related natural resources on agricultural land and other land. The 1996 Act authorized $200 million, annually for EQIP, utilizing funds of the Commodity Credit Corporation (CCC). For fiscal year 2001, the final appropriation was $200 million. In fiscal years 1999 and 2000, $174 million was available. Consistent with the authorizing legislation, the program is primarily available in priority conservation areas in order to maximize the benefits of each Federal conservation dollar. The priority areas consist of watersheds, regions, or areas of special environmental sensitivity or having significant soil, water, or related natural resource concerns that have been recommended through a locally-led conservation process. For fiscal year 2000, nearly 85 percent of the EQIP financial assistance funding was provided within priority areas. I would also note that an additional $20 million will be provided for soil and water conservation assistance outside of conservation priority areas in fiscal year 2001. This funding was initiated through the Agricultural Risk Management Protection Act of 2000.
The EQIP program has been extremely successful. We received 76,168 applications in fiscal year 2000. After NRCS ranked the applications based on criteria developed at the local and state level, 16,443 long-term contracts with farmers and ranchers were approved. Since inception of the program, EQIP has averaged about 3 to 6 times the number of applications than could be approved with available annual funding.
Mr. Chairman, in closing, I would note that conservation doesn't just happen. It happens because all of us, including the Congress, the conservation partners, and most importantly, the people living on the land working together to make it happen. As exemplified through the many programs and activities we have underway, there is a great deal happening on the ground. The public benefits are an improved quality of life, affordable and safe food supply, clean air and water, reduced damages from floods and other natural disasters, abundant fish and wildlife, scenic landscapes, and a sustainable resource base. These benefits are critical to sustain agricultural production, economic prosperity and the social fabric of our communities now and in the future. We are proud of our accomplishments and look forward to working with you to build on all that we have done thus far. This concludes my statement, Mr. Chairman, and thank you again for the opportunity to appear. I would be happy to answer any questions the Committee might have.
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Statement of Bill Horan
Good afternoon. My name is Bill Horan. I raise corn, soybeans, oats and alfalfa in partnership with my brother Joe in Rockwell City, Iowa. I am a member of the National Corn Growers Association's Board of Directors. The National Corn Growers Association (NCGA) represents more than 31,000 direct members and the 300,000 corn farmers throughout the Nation who make check-off payments each year. I am testifying today on behalf of the NCGA, the American Soybean Association, the National Association of Wheat Growers, the National Cotton Council, and the National Barley Growers Association. I appreciate the opportunity to offer this testimony.
The members of our organizations are committed to being good stewards of the land and leaving the environment in better shape than we found it. We have a commitment to our community to ensure that we have clean water and healthy, viable soil to ensure the land is productive for many years to come. We take responsibility for our farming activities and must do so with a keen eye towards conservation, productivity and marketing.
We support the voluntary, incentive-based conservation programs that the past farm bills have created. We believe that flexibility in programs is essential for their widespread adoption, given local variances in conservation and water quality priorities, production practices, climate, soil type and many other factors. These programs have demonstrated agriculture's commitment to working collaboratively with United States Department of Agriculture and other organizations and a commitment to water quality, air quality, habitat protection, and a healthy environment. We believe that these voluntary programs have been successful in producing environmental benefits. As we look toward the next farm bill, we are interested in conservation programs that assist growers in maintaining and/or undertaking new conservation practices in their farming operations. Any new program should contemplate financial assistance for conservation practices on resources and management that support production and generate environmental benefits.
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As we look at broader Clean Water Act issues and regulations, we know that agriculture plays an important role in maintaining a healthy environment. All agricultural producers face increasing regulatory burdens whether it is local, State or Federal requirements on the management of their land. We support programs that will work with our members in utilizing conservation practices and work to maintain a healthy environment. A conservation/environmental incentive payment program could assist growers in meeting these increasing requirements. This approach recognizes an important part of adoption of conservation practice across the farming community - which is, that growers need financial and technical assistance in management of their operations based on conservation principles.
Intensive resource management practices can become as important as a filter strip or buffer strip in achieving conservation goals, but these management practices or choices frequently add to the costs and risks of the farming operation. These are the areas that should be included in the development of the Conservation Title of the next farm bill. Policymakers can work with growers to identify conservation practices that fit in with their management and stewardship of working land. Any program modifications or enhancements must maintain flexibility for local implementation to maximize both participation and effectiveness.
Regarding existing programs, we support continuation of the existing cost-share programs including the Conservation Reserve Program (CRP)—including continuous sign-up, Wetlands Reserve Program (WRP), the Wildlife Habitat Incentives Program and others. These programs have been an excellent investment for the public and have generated significant environmental benefits as documented by USDA. Programs that take land out of production should be managed so as not to take whole farms out of production. The focus of the continuous signup should be on small areas of specific environmental value and there should be local flexibility to meet the environmental concerns facing a specific area of the country. We believe that the CRP should be fully utilized to the 36.4 million acre cap and that any additional land enrolled should be the most environmentally beneficial land utilizing the continuous signup. While the Wetland Reserve Program has generated enrollment that is expected to reach the 1,075,000-acre cap this year, as with CRP, we do not support increasing the acreage cap at this time.
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Regarding the provisions of the 1996 farm bill concerning wetlands and highly erodible land, we support maintaining the flexibility that farmers were given in the bill. Our organizations worked during the last farm bill to provide flexibility for growers with wet areas on their farms. Concepts such as minimal effects and mitigation banking would have provided some flexibility for growers with specific areas of concern on their farm. NRCS has been unable to implement some of the flexibility due to the lack of cooperation of other Federal Agencies, however we would urge the Committee to see that flexibility is maintained and that growers are able to utilize these provisions. Also the implementation of wetland regulations has not been consistent across the country and we ask the Committee to encourage NRCS to implement wetland rules fairly and consistently.
The recent Supreme Court ruling has intensified the inequity of wetland regulations. Since the 1985 farm bill, farmers participating in the farm program have been held to the highest standard of wetland protection in the land. This inequity was supposed to be addressed in the 1996 farm bill with some of the regulatory relief measures that were included in the bill. Recently, significant wetlands regulatory relief was granted by the courts due to the Supreme Court ruling on Solid Waste Agency of Northern Cook County v. U.S. Army Corps of Engineers regarding isolated wetlands. While this is welcome relief to developers and our State and county highway departments it is of little help to most farmers since swampbuster is still the highest, regulatory hurdle. In fact, we will now face the irony of court ordered regulatory relief for all except the American farmer.
The Wildlife Habitat Incentives Program offers farmers a unique opportunity to receive NRCS technical assistance and cost share monies to install conservation practices improving wildlife habitat on private lands. We support the program's state and locally-driven habitat priority setting process, and also NRCS's coordination role with private partners like Ducks Unlimited and the National Association of Conservation Districts in implementing the program at the ground level. The commodity organizations support the continuation of this voluntary program. Further, since this program's objectives are to enhance wildlife, we would encourage a balanced approach to the addition of overly costly wildlife objectives to other program rules and regulations.
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The Environmental Quality Incentives Program, while designed to better target scarce financial resources, has become a very complicated program for commodity producers to utilize. Many were understanding of the desire to consolidate programs and prioritize project areas, but the ensuing challenge and dissatisfaction centers around who gets access to limited fund. Improvements should be made to the program to expand the flexibility and allow more producers to participate and increase the total funds available.
While each area of agriculture is facing commodity specific production concerns, many of us also watch with keen interest the status of the U.S. Livestock industry. The interdependence of commodity and livestock production is very evident in U.S. agriculture and we strive to maintain the productivity and profitability of each. Increasing regulations, Federal, state and local are placing a heavy burden upon agriculture and we must be given the tools and resources to comply with new regulations if we are to remain competitive in a global market place.
Each of these programs mentioned provide an integral part of the overall conservation and environmental/water quality objectives. Federal programs provide financial resources and technical assistance to facilitate the adoption and management of conservation practices. Federal, state and local cost-share programs are essential for the greater benefit provided by these practices. Our members are engaged in farming as a livelihood and must maintain the ability to raise productive crops on their land and market their crops to maximize profitability.
We support locally led, voluntary, incentive-based programs, specifically those that work on a watershed basis. In order for these programs to work, there must be local people to work with our farmers and others in agriculture in improving conservation practices. USDA's Natural Resources Conservation Service (NRCS) has a good track record on voluntary incentive-based programs, as well as an extensive field staff network. Therefore, we in agriculture will be looking to NRCS as an important delivery mechanism of technical assistance to landowners. We support Federal funding for NRCS conservation operations; to maintain and expand that structure as needed to help protect our natural resource needs.
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Recognizing that there are still gains to be made in water quality, we believe that our goals of clean water, productive land and a viable domestic market are attainable. We believe that USDA is the primary Federal Government resource to assist growers across the country in attaining these goals. Whether it is through the technical assistance provided to growers for compliance with a myriad of government programs or for voluntarily adopting a conservation practice, USDA has the structure with local delivery units, to provide the support necessary for growers to continue their commitment to the land.
Each of our organizations are facing their own production and marketing challenges. Low commodity prices, coupled with increasing input costs, new regulatory burdens and the need to continually increase productivity have resulted in a serious cost/price squeeze and low farm income. We appreciate the opportunity the Committee provided for each of our organizations to present specific commodity program proposals. We also appreciate the efforts of the committee to secure additional funding for agriculture in the new budget resolution. As we have each presented the committee with commodity specific proposals, we share the conservation goals outlined in this statement and the belief that the conservation title should work in conjunction with a fully funded commodity title. It is essential to us that the provisions of the conservation title provide voluntary, incentive-based options for producers, but not replace or serve as a substitute for the commodity programs proposed by our organizations in earlier hearings. Producers need to be given flexibility in meeting increasing regulatory challenges whether they are local, state or Federal requirements placed on their operations or the management of their land. USDA technical assistance, local watershed activities and cost-share programs are a proven approach to addressing environmental challenges. We support continuing this conservation commitment to help undertake conservation practices on productive farmland through the reauthorization of the conservation title of the next farm bill.
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Statement of Dusty Tallman
Mr. Chairman, as president of the National Association of Wheat Growers (NAWG), and on behalf of wheat producing farmers across the nation, I thank you for the opportunity to submit our testimony regarding the Conservation Title of the farm bill.
NAWG represents the 238,000 U.S. farmers that plant approximately 63 million acres of wheat annually. Besides providing the world with a safe, abundant, and affordable supply of food, our members are tremendous stewards of the Nation's land, environment, and wildlife resources. We are committed to our families, our communities, and our country to ensure that we maintain and improve the productivity of the land, the health of the environment, and the quality of our food supply.
The farming and ranching community has made tremendous strides, often at personal cost, to improve the environment. With rebounding waterfowl and wildlife populations, better soil conditions and decreased erosion rates, and improved wetland protection and restoration efforts, agriculture continues to make positive environmental contributions through efforts on private lands.
As you know, however, America's farmers continue to face pressures to further protect the environment while simultaneously confronting the reality of low commodity prices, increased input costs, and at best marginal profitability. Farming is becoming an increasingly difficult business as the struggle to maintain profitability collides with tougher air, water, and land use regulations.
Mr. Chairman, NAWG supports the voluntary, incentive-based, and flexible conservation programs that have allowed the agriculture community to make these impressive environmental gains. As we confront the new environmental challenges of the twenty-first century, we would urge that we learn from the lessons of the past. Mandates and heavy-handed regulations are inefficient, ineffective, and very inequitable, and often fail to deliver the promise of a better working environment.
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Environmental problems increasingly require site-specific policies that can be adapted to local climates, resource conditions, and specific operator needs. In addition, the future of on-farm conservation practices will be proactive in nature as producers are now demonstrating through the adoption of practices such as conservation tillage that seek to prevent future problems. Finally, the future of conservation will require reasonable incentives to encourage and assist operators in the adoption of sound, proactive conservation practices. As such, NAWG offers the following comments on current and proposed conservation programs and environmental issues.
Conservation Reserve Program. While we fully support the Conservation Reserve Program (CRP), NAWG believes the current cap of 36.4 million acres is adequate and should not be raised. The regular CRP, and the continuous sign-up and conservation reserve enhancement program components, have proven a valuable investment for the public and the environment. However, we believe that increasing the investment in CRP is not productive or cost-efficient.
In some locations, CRP whole-farm acreage and high rental rates are beginning to out-compete producers who seek to rent land for production. Contract rentals should be limited to the average county rental rate, and care should be taken before enrolling whole farms in the program. In addition, the Environmental Benefits Index should be revised to return the focus of CRP to marginal soils and fragile lands. Any additional acreage remaining under the existing cap should be enrolled in the continuous sign-up to help producers address site-specific and sometimes cost-prohibitive environmental problems.
1Wetlands Reserve Program. Like the CRP, the WRP has been a very successful program. However, NAWG does not support raising the acreage cap from the current 1,050,000 level. Acreage set-aside programs such as the WRP and CRP are excellent programs, but they do not represent the future of on-farm conservation.
Environmental Quality Incentives Program. The EQIP program should be made more equitable, and it should be amended to allow commodity producers to better utilize the program. Currently 75 percent of all funding goes to priority areas, leaving many producers ineligible for EQIP cost-share dollars. Either the priority-area process should be revised, or some of the focus should shift from places to practices, allowing the flexibility to address specific concerns such as TMDLs or encourage practices such as BMPs. This shift would allow many more producers to participate in the program.
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The funding structure should also be changed: cost-share and incentive payments under EQIP should be made as soon as possible following a contract, and program funding should be allowed to be carried over between fiscal years. Funding should also be available for land enrolled in the CRP or WRP. Shorter-term contracts should also be made available to interested producers.
Finally, the whole farm planning emphasis of EQIP makes it difficult for many producers to benefit from the program. Whole farm planning is expensive, time consuming, and often the local NRCS staff does not have the resources to meet demand. The Committee should provide greater authority to use certified third party vendors for technical assistance and planning.
Wetlands. We believe it is a responsibility of the Committee to provide a rational and coherent national policy guiding the utilization, protection, and enhancement of wetlands on our agricultural lands. Operators should have clear and unambiguous direction from the government regarding their responsibilities under wetland regulations. Currently, such direction is lacking, leaving many producers in a quagmire of conflicting agency jurisdictions and missions.
NAWG supports wetland regulations that provide full flexibility to producers. Minimal effects regulations and wetland mitigation banking should be aggressively utilized to minimize problems associated with wetland regulations and swampbuster. Part of the reason the NRCS has been unable to implement the flexibility on wetland issues provided under the 1996 farm bill is due to a lack of cooperation from other Federal agencies. We would ask the Committee to see that wetland regulations are implemented on a more equitable and consistent basis, and that growers are allowed to utilize the wetland mitigation and minimal effect provisions of the 1996 act.
Conservation Incentive Payments. We are aware that members of the Committee and many others have expressed an interest in creating a new program to provide incentive payments for working lands conservation. NAWG believes the future of on-farm conservation policy should focus on productive agriculture lands rather than set-asides and reserves. However, we do have some concerns regarding these conservation incentive payment programs.
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While we appreciate and support the concept of focusing conservation efforts on working lands, we remain wary that a new program may create new problems. First, we are concerned that local NRCS staffs and budgets will be over-burdened; currently, there is a greater need for technical assistance and staff field time than the NRCS can possibly provide. Any new major conservation program would likely intensify these problems.
Another significant concern is the possible association between future environmental regulations and the proposed incentive payments. Farmers now engage in many of the conservation practices on working lands in a voluntary manner, free from the encumbrances of cost-share programs or government regulations. While we encourage a continued focus on the adoption of sound production practices, such as conservation tillage, we remain justifiably concerned that today's incentive payments may become tomorrow's production regulation.
Finally, while we understand and appreciate the importance of the farm bill's conservation title, we do not want to see commodity program payments replaced by any form of conservation incentive payments. The first responsibility of our nation's agriculture producers is to provide the world with a safe, abundant, and affordable supply of food, feed, and fiber. The government should continue to provide assistance to this end, and should not seek to replace food production as the primary objective of our nation's agricultural lands.
Mr. Chairman, in conclusion I would like to thank you and the Committee for the opportunity to submit testimony and share our thoughts and concerns regarding the conservation title of the farm bill. While we recognize that new environmental challenges await agriculture, and that the public is placing new values, such as recreation and amenity values, on farmland, we would ask that we first recognize the gains agriculture has made. As we have increased productivity, cost-effectiveness, and profitability, we have also improved the condition of our land, air, water, and wildlife resources.
These achievements should not be overlooked; nor should the manner of our successes be ignored. Farmers continue to lead by example, protecting the environment and wildlife through voluntary measures on their private property. Where assistance is needed, incentive and cost-share programs that are flexible, voluntary, and farmer-friendly have provided the encouragement to address the more difficult and costly problems. The future of on-farm conservation lies down this path.
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FORMULATION OF THE 2002 FARM BILL
(CONSERVATION PROGRAMS)
WEDNESDAY, JUNE 6, 2001
House of Representatives,
Subcommittee on Conservation, Credit,
Rural Development and Research,
Committee on Agriculture,
Washington, DC.
The subcommittee met, pursuant to call, at 1:03 p.m., in room 1300, Longworth House Office Building, Hon. Frank D. Lucas (chairman of the subcommittee) presiding.
Present: Representatives Moran, Thune, Osborne, Graves, Putnam, Kennedy, Baldacci, Phelps, Thompson of California, Baca, Peterson of Minnesota, Clayton and Stenholm [ex officio].
Also present: Representative Chambliss.
Staff present: Ryan Weston, subcommittee staff director; Dave Ebersole, Callista Gingrich, chief clerk; Susanna Love, Elizabeth Meyer, Anne Simmons, and John Riley.
OPENING STATEMENT OF HON. FRANK D. LUCAS, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF OKLAHOMA
Mr. LUCAS. This hearing of the Subcommittee on Conservation, Credit, Rural Development and Research to review the conservation issues will come to order.
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I would like to welcome you to the subcommittee's second of three hearings to discuss conservation issues. Two weeks ago, I stated that this subcommittee had been tasked with determining what conservation measures are needed in the next farm bill and that we would not take that responsibility lightly.
The invitation letter sent out to last week and today's witnesses asked for specific information and, just to note for the record, the letters clearly stated that the purpose of this hearing was to receive testimony from you regarding conservation programs in the context of a comprehensive farm bill. The subcommittee is interested in how the current programs are operating, what changes need to be made to the programs and their funding levels and whether current programs or new programs are needed to help producers comply with the regulatory standards.
Some of the organizations have done an excellent job of giving recommendations, while others have a little work yet to do. The reason I have asked for witnesses to give testimony in the context of a comprehensive farm bill is so that they are aware of all of the spending needs that we must consider.
In addition to the commodity and conservation titles of the farm bill, we are going to have requests for changes in the credit and rural development and research titles that will also require expenditure of mandatory funds.
The interesting fact is that if we add up what the majority of groups are asking for in the commodity titles plus what most groups are asking for or are going to ask for in a conservation title, we have already spent more money than has been budgeted for the entire farm bill, and that's why I want to focus this hearing on what is working and what is not working and what can be done in a more efficient fashion and how that can be accomplished.
Last week, this subcommittee was asked to spend over $1 billion more per year on EQIP alone. The request was to ensure that there would be available to agriculture producers cost share and incentive funds. This week, we will be asked to expand CRP, WRP, as well as WHIP, the Farmland Protection Programs and others. This is all before we are asked to look at an incentive payment program that could run into the billions of dollars per year.
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Can we expect USDA to effectively administer a new program when they have a backlog in current programs, or should we be focusing on ensuring that the current programs are adequately funded?
CRP alone is authorized to set aside $36 million acres, and that is over 10 percent of the cropland of the entire United States. If it goes up to 45 million acres and we add in other permanent easement programs, we will be setting aside somewhere between 15 and 20 percent of the cropland in the United States. Now, some economic studies have led us to believe that as we set aside land our competitors overseas simply have made up the difference.
We all know that numbers can be manipulated to show various results, and I am a supporter of CRP. However, I simply want all of you to consider the pros and cons of our actions. Is taking more land out of production good for the U.S. farm sector and rural economies? I believe we will see a good debate on this issue today and in the coming days.
With that, do any of my colleagues have any opening statements?
[The prepared statement of Mr. Hilliard follows:]
PREPARED STATEMENT OF HON. EARL F. HILLIARD, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF ALABAMA
Mr. Chairman, members and distinguished guests, conservation programs on private land are some of the most important available to America's fanners. In my district in the Black Belt of Alabama, more money comes to fanners from conservation spending alone than from commodity payments.
This means that conservation provides more Federal money to Alabama fanners than commodity payments for cotton, our largest crop. These programs, especially the Conservation Reserve Program, provide the difference between success and failure for many fanners in this Nation, as well as in my own district and State.
I support all American fanners, but I am especially concerned for our small, poor, and minority fanners who continue to have difficulty accessing Government programs. I hope in your testimony that you will address this problem of access and use of the programs. It is my belief that conservation programs, while protecting and restoring the health of our lands, can also bolster these small fanners. Their lives, families, their communities and their values are important to our great nation and I think that all our programs should consider and support the least among us.
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Mr. LUCAS. We will now turn to our first panel; and they are right there at the table. Ms. Jamie Clover Adams, Secretary of the Kansas Department of Agriculture from Topeka, Kansas, and on behalf of the National Association of the State Departments of Agriculture; Mr. Joe Cantu, president of the National Association of Resource Conservation and Development Councils, Incorporated, Pipe Creek, Texas; Mr. J. Read Smith, president of the National Association of Conservation Districts, Resource Conservation Development Councils, St. John, Washington; Joe Neal Hampton, president of the Oklahoma Grain and Feed Association, Enid, Oklahoma, on behalf of the National Grain and Feed Association.
Ms. Adams, when you are ready.
STATEMENT OF JAMIE CLOVER ADAMS, SECRETARY, KANSAS DEPARTMENT OF AGRICULTURE, TOPEKA, KS, ON BEHALF OF THE NATIONAL ASSOCIATION OF STATE DEPARTMENTS OF AGRICULTURE
Ms. ADAMS. Thank you, Mr. Chairman. We do appreciate the opportunity to be here today and offer testimony on the conservation provisions of the farm bill.
For the record, my name is Jamie Clover Adams, and I am here today to represent the National Association of State Departments of Agriculture.
Today I will present a broad outline of a new environmental stewardship program for America's open spaces, the 900 million acres under the care of American farmers, ranchers and their families.
I need to stress that this is a work in process. It is a product of extensive discussions over many months with my colleagues from every region of the country. Our dialog continues. We do support the continuation of existing programs with increased funding, and we recommend certain changes in WHIP, EQIP and CRP. For example, with EQIP, we recommend that USDA allow flexibility and discretion in administering the program, allow 1-year contracts, remove the $50,000 payment cap and remove the national size restriction for livestock projects.
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These and other proposed changes are described in my written testimony.
Despite the overall viability of existing programs, we see gaps in coverage that are probably inevitable, given the focus of these programs on national issues.
Because meeting environmental demands is a make-or-break challenge for many agricultural producers, many of our State Departments of Agriculture have taken the initiative to design programs tailored to address resource needs in our States that cannot be met with existing conservation programs.
For example, in Kansas, the Kansas Department of Agriculture established a pesticide management area. The object was to limit the amount of atrazine and other soil-applied herbicides that were going into our surface waters.
First, we worked with our Kansas State University to develop voluntary best management practices, and we published those, dependent on the farmers tillage practice. Then our State Conservation Commission offered a pilot program of $5 per acre to farmers in one critical watershed to encourage the adoption of these BMPs. Further, these farmers were contacted on various occasions, both by the Conservation Commission and by a KSU extension employee dedicated to the project.
Participation was nearly 100 percent. But, more importantly, all waters have been removed from the atrazine-impaired waters list, except for Tuttle Creek, which receives 80 percent of its pesticide load from Nebraska. And I am happy to report that Kansas and Nebraska are working together to solve that issue as well.
The PMA and similar programs in other States supplement existing Federal conservation programs while helping farmers bear the cost of what we see as substantial public benefit. And I would emphasize that they are providing a public benefit that the public wants.
We know that expectations, as the chairman said, in growing, increasing regulation are putting burdens on our farmers and ranchers. The short-term and long-term economic payback just isn't there, and you all know that agriculture is not like other businesses where they can pass those costs of production on to consumers. It competes with servicing farm debt and other family financial needs.
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I would also point out to the committee that the Federal Government has spent a lot of money cost sharing with local governments to upgrade wastewater treatment plants across our country to meet the requirements of Clean Water Act without bankrupting small communities across our Nation, and we only ask for that consideration as well for America's farmers and ranchers.
Now, to the block grant program that NASDA proposes, it is a new program, kind of if you think of it as a working fund to get at these gaps, to get at the needs that we see on the ground every day in our States.
First, the funding would be provided through cooperative agreements between USDA and State departments of agriculture. The State Departments would serve as the lead agency in designing and carrying out the program.
Second, the program parameters would recognize activities that enhance protection of the land, water, air and wildlife, defined in the broadest terms possible to permit local flexibility and avoid duplication of existing planning systems and infrastructure.
Third, the States would have the flexibility to allocate dollars between both payments to producers and technical assistance based on local needs and priorities.
Fourth, participation would be voluntary, incentive-based and targeted to environmental enhancements that are supported by science and, most importantly, produce results.
Contract payments could be made on an annual basis, and all data would be private and confidential.
We expected, Mr. Chairman, that this proposal would fit within the green box of WTO and our commitments there.
We appreciate the opportunity to be here today, and I would be glad to stand for questions at the appropriate time.
[The prepared statement of Ms. Adams appears at the conclusion of the hearing.]
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Mr. LUCAS. Thank you. Mr. Cantu.
STATEMENT OF JOE CANTU, PRESIDENT, NATIONAL ASSOCIATION OF RESOURCE CONSERVATION AND DEVELOPMENT COUNCILS, PIPE CREEK, TX
Mr. CANTU. Good afternoon, Mr. Chairman and members of the committee. My name is Joe Cantu. I am president of the National Association of the Resource Conservation and Development Councils. I am one of thousands of volunteers who serve on RC&D councils across the country. I am here to discuss the farm bill recommendations for the RC&D Program. I would like to submit my full written statement for the record.
The RC&D Program began as a pilot USDA effort to address conservation and economic development in rural areas.
The Resource Conservation and Development Program is based on a number of concepts that make it a truly unique Government program. These concepts include: community sustainability with a balance between rural economic development and natural resource protection; grassroots involvement; leveraging limited Federal dollars; public/private partnerships; and bringing USDA agencies together to focus on the same problems and opportunities.
RC&D Council members are volunteers that include local, civic, appointed and elected officials. RC&D councils are nonprofit organizations that work in partnership with USDA's Natural Resources Conservation Service.
The program has grown significantly over the years as a result of its ability to provide local solutions to local challenges. We are the catalyst for bringing people together to identify their needs, and then we search out funds to solve the problems.
Here are a few examples: The Cherokee Hills RC&D Council in Oklahoma was instrumental in the formation of and continues to provide technical assistance to the TenKiller Utilities Authority. As a result of RC&D assistance, the community is now seeing improved health standards for an underserved population. Over 60,000 customers are provided with safe drinking water.
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The ALA-Tom RC&D Council in Alabama is very active in small farm revitalization efforts. The council has facilitated four cooperatives and developed basic infrastructure to provide markets for their products. Last year, in spite of a serious drought, one of the cooperatives made a profit and prevented local crop failures because of RC&D Councils assisted them with a mulch/irrigation project. The council has assisted the cooperatives in developing a system so that they can sell their products to the school lunch programs both in Alabama and in Florida. This effort has improved the quality of life for many minority farm families and stimulated the economy in those areas.
RC&D councils are making a difference in America's communities and represent the entrepreneurial spirit of rural America. RC&D councils have played a strong role in increasing new businesses, education, conserving our natural resources, bioenergy development and outreach.
To assist in increasing conservation and economic development in communities that are hard hit by low farm income, the National Association of RC&D councils requests the following changes to the farm bill:
Permanent authorization of the RC&D Program. This is our highest priority. We believe that the recent growth in the RC&D Program from 277 councils in 1996 to 348 councils in 2001, covering 80 percent of the Nation and 180 million people, is a testament to our success. Congress has recognized the valuable services RC&D councils provide to local communities and has helped to grow this program.
In addition, we have successfully leveraged a $42 million Federal investment into more than $1 billion annually to directly support conservation and economic development, making a continued investment in RC&D a cost-effective investment of taxpayers' funds.
Update our statement of purpose and write the role of the RC&D councils into the law and define RC&D councils' affiliations. The recommendation is a technical change to the law. The structure of the RC&D councils evolved and USDA recognizes RC&D councils as the entity that carried out the mission of resource conservation development. As a result, we believe that RC&D councils need to be recognized in the law.
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Encourage USDA agencies to provide technical assistance. The administrative responsibility for the RC&D Program is delegated to NRCS with the expectation that full array of USDA programs and services are available to assist RC&D councils to achieve their goals.
Mr. Chairman, and members of the committee, we request that the farm bill include legislative language that encourages USDA agencies, consistent with their mission and authority, to bolster these relationships. RC&D councils are an effective delivery system for rural America, and we see no need to duplicate the RC&D concept to create new programs or entities to deliver services to rural America.
Mr. Chairman and members of the committee, I thank you for the opportunity to testify here today, and I welcome the opportunity to respond to any questions.
[The prepared statement of Mr. Cantu appears at the conclusion of the hearing.]
Mr. LUCAS. Thank you. Mr. Smith.
STATEMENT OF J. READ SMITH, PRESIDENT, NATIONAL ASSOCIATION OF CONSERVATION DISTRICTS, ST. JOHN, WA
Mr. SMITH. Good afternoon, Mr. Chairman and members of the committee. I am very pleased and honored to have travelled across our country to be with you here today.
I am currently president of the National Association of Conservation Districts, but, more importantly today, I am here as a farmer and a rancher and a conservation district official. I was elected 28 years ago to serve in my conservation district in eastern Washington, and I have proudly worked for that period of time implementing the programs that your committee authorizes. I am very proud of that.
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I would refer you to my written testimony and ask that that be included in the record, and for specific comments and recommendations on existing programs, I would refer you to that written testimony.
I want to visit with you today about a new vision, a new approach that the Nation's conservation districts have for the conservation title of the farm bill.
We have attempted, since 1985, to solve our problems by creating programs. We have developed programs after programs that, wonderful as they are, they tended to make smaller pieces out of an ever-shrinking pie. I am here today to suggest that what we need to perhaps do, look at a new vision. We need to change the process from finding programs that will solve our conservation problems to developing conservation plans and then seeking the programs that will solve those problems, a complete reversal of what we are doing now.
Unfortunately, many of the plans that we are currently operating with down on the farm where I live are generic, computer-generated, impersonal, with no buy-in by the farmers and ranchers that implement them. We need to get back to the self-directed hometown plans that are written site-specific and then find the resources in order to solve the problems that we have.
We have developed over the last 2 years a conservation incentives program that would do just that. They are based on the strong philosophies conservation districts across the country have of voluntary, incentive-based and locally led. We need to include the local conservation districts and State agencies and the States in the decision-making process in implementing these programs at the local level.
We have spent nearly 2 years developing our recommendations for this committee. During that time, we have reached out to the 3,000 districts across the Nation and got input from nearly 1,700 of those districts. Included in our reach-out was over 90 different groups that are interested and have weighed in in the past on the conservation title of the farm bill. We had nearly 50 of these organizations respond to us, and we were very amazed to find out that most all of these groups had very similar concerns to some of ours. We have responded to those folks by including some of their thoughts along with ours, and hopefully we have developed a comprehensive package that is very favorable to a wide audience here in town.
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Clearly, this will take a significant increase in both financial assistance and the technical assistance, and that is the scientists, the economists, the engineers and so on, conservationists, to carry out this new vision.
The recent workload analysis indicated that there is a need out there for $2.4 billion worth of technical assistance that is being unmet. So we recognize the huge investment that the country must make in this, but certainly we would like to see the committee prioritize that investment and at least get initially started along the way.
Our program and our vision will reach out to far more producers than existing legislation. We need to cover more acres, more people and reach out to the entire country, not just selected commodities or groups, and our vision will go a long ways towards doing that. It will provide flexibility and local control.
Certainly we need to have Federal guidelines for implementing these types of programs, but we have a huge pool of over 7,500 State and local employees that work day-to-day with our Federal partners, and we need to utilize this wonderful resource, and together we can build a program that will solve the natural resource problems on private land.
There is huge public benefit in what we do. We need to learn to tell the public what is in it for them—and certainly the public is very understanding about the investments that's necessary in order to achieve these goals—better soil, cleaner water, greater profits and a brighter future for agriculture, in addition to abundant wildlife, higher quality wetlands and really an enhanced quality of life for all Americans. And the investment and prevention is far cheaper than the cost for solving the problems later.
I would welcome your questions.
[The prepared statement of Mr. Smith appears at the conclusion of the hearing.]
Mr. LUCAS. Thank you. Mr. Hampton.
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STATEMENT OF JOE HAMPTON, PRESIDENT, OKLAHOMA GRAIN AND FEED ASSOCIATION, ENID, OK, ON BEHALF OF THE NATIONAL GRAIN AND FEED ASSOCIATION
Mr. HAMPTON. Mr. Chairman, distinguished members of the subcommittee, I am Joe Neal Hampton; and I am president of the Oklahoma Grain and Feed Association. I appear today on behalf of our association, 14 other State and regional grain and feed associations and the National Grain and Feed Association. We represent over 4,000 grain and feed-related firms who are the farmers' first customer beyond the farm gate. I ask that our testimony be referred to, entered into the record.
My oral testimony today will ask this subcommittee to ensure that the new conservation title to the new farm bill will be targeted towards the conservation needs of all sectors of agriculture.
We all want a rural America and an agriculture industry that has as little environmental impact as possible on our land and water resources but also want an economically strong rural America. Current and new conservation programs must be tailored to help producers meet their environmental responsibilities, while ensuring that producers and the rest of rural America remain economically viable.
In keeping with this view, we would like to recommend four things: First, that the CRP's current acreage of 36.4 million acres be retained and not increased; second, that any new acreage enrolled to CRP be focused on filter strips and partial field enrollment.
I would like to cite a USDA Agricultural Research Service study that was done in Oklahoma a few years ago that indicated that a mere 66-foot-wide vegetation filter strip can capture 60 to 90 percent of the nutrient runoff from the field. The larger the filter strip, the more nutrient runoff it captures; and in my mind that is a great value for the taxpayer, to protect our water with a simple vegetative filter strip.
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Anyway, we believe that these resources are much better focused on CRP rather than whole farm enrollments which have a detrimental effect on the rural economy. We support earlier testimony by livestock groups that recommend working lands be kept working.
Thirdly, that Congress and the administration minimize the number of counties that reach the maximum limit of 25 percent of tillable acreage, again to preserve the viability of rural economy.
And, fourth, more emphasis to be given to conservation programs such as the EQIP program for all types of agriculture production, including animal feeding operations, and that the EQIP funding process be streamlined and somehow made more directly accessible to producers.
As a side note, I and several other of my producer friends have been trying for 5 years to figure out a way to get terrace and waterway funds to build and reconstruct, and it is a very difficult process, and we like the old program where you knew you had some money to be able to go and get that cost share.
One thing the conservation programs were never meant to do, and they cannot do, and that is to impact commodity prices over the long term. For many years, the United States attempted to do this through high loan rates and idling acres programs, but the result was this lost market share, decreased exports without any long-term price benefit, simply because foreign acreage replaced ours. From 1980 to 1995, while we were idling 33 million acres, our foreign competitors brought on line 49 million acres and in the top 19 wheat-producing States in the United States account for over half of the current CRP acres.
We have witnessed a substantial increase in the amount of imported wheat and a loss of global market share during the same time, and our wheat export market share has dropped from 40 to 25 percent. Now, while CRP is not the sole factor for this cause, it is certainly a contributing factor.
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Rural economies are hard hit by land idling, including places where CRP is high. Congressman Lucas, in Shattuck, Oklahoma, in your district, since the CRP was implemented, 23 businesses have closed, which represents 25 percent of the local economy. And the population has decreased by half during the same time period.
Acreage idling also erects barriers to young farmers. When the Government is essentially competing to be a tenant, young producers cannot have access to enough acres to spread their fixed costs over enough acres. Also, the average age of producers in Oklahoma is 60 years of age; and what America needs is more young farmers and not programs that serve as retirement benefits for absentee landlords.
I will be free to answer any questions you might have. Thank you.
Mr. LUCAS. Thank you.
[The prepared statement of Mr. Hampton appears at the conclusion of the hearing.]
Mr. LUCAS. That might be a good point to begin with a question or two on, since you bring up CRP and the effect in rural western areas like northwest Oklahoma, Joe Neal. This is not the first time that we have had programs with a major land idling provision in them. Forty some years ago, the old soil bank of the 1950's and 1960's had some similar provisions, perhaps not quite as much of a focus on soil and water and wildlife, but nonetheless idling of the land. Your institutional memory being what it is, how did that affect, if it did affect, rural America in comparison to what CRP has done now?
Mr. HAMPTON. I think it had the same effect, in that when you idle the acres, especially when you are talking about wheat and it is such a global commodity, that if we are not going to do it, somebody else can be able to pick up those acres and provide the wheat for the people that want to buy it.
Mr. LUCAS. And it is fair to say, isn't it, Joe Neal, that you are not advocating not idling environmentally sensitive acres? You are talking about the effect of wholesale programs.
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Mr. HAMPTON. Yes, sir.
Mr. LUCAS. Let me address this question to the whole panel. As you heard me comment upon in my opening remarks, customarily the Agriculture Committee for the last 50 years has struggled with trying to come up with enough resources to do all of the things that we have a responsibility for; and this year this farm bill will be no exception to the needs of commodity producers and the needs of conservation efforts, also.
Should all conservation programs be required to be leveraged or matched by State resources? And the concept behind that is to make the dollars stretch farther. Are there any feelings out there among the panel? Anyone?
Mr. CANTU. Mr. Chairman, this is Joe Cantu. I would definitely say that I think that that would be an approach that we should go after, sought after. I believe that the responsibility of this whole conservation effort should be shared by all Federal and also State levels.
Mr. LUCAS. Anyone else?
Ms. ADAMS. Mr. Chairman, if I might, my colleagues have discussed this issue as well, and we are still discussing it. I didn't sense any opposition to that.
I would point out, in our State, we have done a needs assessment of three river basins that need TMDLs for high-priority areas. That total is over $200 million. We have some money in our State, but we don't have $200 million.
So I think folks are willing to step up to the plate, but it is going to take larger resources. And I would point out, as I did in my oral statement, that the Congress has provided money for small communities to put in wastewater treatment facilities to meet public goals, and I don't see this as any different. And perhaps we can get folks outside of agriculture to see it that way. They might be more willing to fund those programs.
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Mr. LUCAS. Mr. Smith.
Mr. SMITH. Mr. Chairman, there are many States today that are making very sizable investments in conservation. I am sure you are very well aware of the programs that States are sharing with the Federal Government, and there is no question in my mind if a requirement was to be developed for cost sharing and sharing, leveraging dollars, that you would see an increase in the investment that States are giving conservation. So I would certainly encourage that as an option, and I think that States will recognize and step up right away.
Mr. LUCAS. Changing subjects for just a moment, Mr. Cantu, the committee, of course, has an appreciation for the RC&D's efforts around the country, but could you expand for a moment on how your concept works, the councils work, in regard to their relationships with State government and the NRCS?
Mr. CANTU. Mr. Chairman, we partner with many different organizations to be able to achieve the goals of our efforts. We partner strongly with the saltwater conservation districts such as in Texas with Texas Rural Development councils and with anyone else, Forest Service, whoever we can, to make sure that we deliver our set goals.
One of our concepts is the uniqueness of RC&D carries across the board into many different areas other than just conservation of resources, and so we take advantage of whatever partnerships we can to make sure that we can deliver.
Mr. LUCAS. With that, I turn to Mrs. Clayton for any questions she might have.
Mrs. CLAYTON. Thank you, Mr. Chairman.
Ms. Adams, in your testimony you make reference to increasing and giving some flexibility to the agricultural stewardship program, increasing probably the limitations. I was just wondering how you would fashion that so that either we wouldn't have too many eligible people?
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Ms. ADAMS. You are speaking of EQIP, ma'am?
Mrs. CLAYTON. Right.
Ms. ADAMS. In our State we set up priority areas by the State Technical Committee. I can say personally the desire to raise the national cap comes from the fact that perhaps a thousand head feedyard in Michigan is large, but in Kansas it is not the size of feedyard that a family would have. And we see in our State, and my colleague from South Dakota calls them betweeners, and those are the folks that are really in the business as a family and can't get cost share, because they have to be fairly large to support that family. So we would target based on priority watersheds within a State. So it would vary depending on the State that you are in and the priorities that they have set.
Mrs. CLAYTON. So Kansas would be different from Michigan, and Michigan would be different from North Carolina.
Ms. ADAMS. Yes, ma'am.
Mrs. CLAYTON. And the States themselves would make that decision.
Ms. ADAMS. I would see it as we have discussed within NASDA. It would take many different forms, but I think we would definitely agree with the conservation districts that it would have a local component with stakeholders at the table designing the program, because that is how you make changes. You are changing people's habits and you have to change their heart and their mind in order to make a difference, and you can't do that by shoving it down their throat. You have to have them at the table to help make the decisions.
Mrs. CLAYTON. I agree with you that we do have to have the consultation and everybody around the table, but the allocation based on the size seems to put a little bit in contradiction of making those resources available for smaller farmers. If you want to raise the cap, if you have a limited pot of money and—we don't have an unlimited pot of money. So raising the cap, you are either going to give more to fewer if you have relatively the same pot of money. I am just trying to find how would you fashion an equitable proposal, even if you did it in the individual States, that would allow for us to be responsive to smaller farmers with smaller plots of land.
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Ms. ADAMS. I think my testimony outlines the problem we face in our State. Many of our small producers don't take advantage of it because they can't make the capital investment. EQIP only covers the waste treatment system. It doesn't cover the bunks, the pens and everything else that goes along with that.
And we have a little saying on the northeast part of our State. They are called second-year good-year workers. They are part-time farmers, and they need to make changes, but they can't take advantage of the program as it currently exists, because they want to engineer a Cadillac, when maybe a Chevy would do.
So I don't think raising the cap necessarily takes money away from small producers. I think the program has problems as it is when it comes to allowing small producers to participate.
In our State specifically our greatest need is where our smallest producers are, but we feel that there are those in the West who do deserve to have an opportunity for those funds who may exceed the thousand animal unit limitation.
Mrs. CLAYTON. So for raising the cap without damaging the opportunity for the small farmers.
Now, what would you recommend that we could suggest to make this rule amenable to smaller farmers, since they are pushing down a Cadillac and they need a Chevrolet or a Ford or whatever? So what would you recommend that we should consider to make it more assessable and usable to smaller farmers?
Ms. ADAMS. I think the block grant proposal that NASDA has brought forward would take care of a lot of those problems. But I think the fact that the guidelines are set in Washington, that the State conservationists feels like they have to follow the guidelines of Washington, doesn't allow them to consider simple things like shelter belts and alternative water supplies to get cattle off of cricks. So I think there are easy ways to solve the problem, but it is just that the guidelines of the problem don't allow the money to be present on those less-engineered activities.
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Mrs. CLAYTON. Well, let me move to the Resource Conservation and Development Council.
How are you currently funded now? Are you in the Conservation Program, sir?
Mr. CANTU. We are funded through USDA, administered through NRCS.
Mrs. CLAYTON. Right. I am working with some of our council and we are trying to expand our councils to our State because we think you provide a terrific service, and similar to Mr. Smith said, that it involves volunteers, and so you can amass the technical assistance, working with the county commissioners and the natural resources. But there was a question raised to me about funding, and I thought there might have been a question not to the amount, but where it was placed. Is there any concern about that?
Mr. CANTU. Not to my knowledge. When you are talking about funding with RC&D, our Federal funding is discretionary funding through USDA, but what we have a strong reputation for is being able to leverage funding, which we normally do once a county committee comes up with a project, then we look for sources of funding.
Mrs. CLAYTON. Right.
Mr. CANTU. And those sources of funding are normally——
Mrs. CLAYTON. I think what it was, it was that when you begin to look at—how many are there now?
Mr. CANTU. There are 348 councils across America.
Mrs. CLAYTON. Right. That they were fearful that the cap was going to prevent any expansion of those. And we looked at North Carolina. We are looking at our State, and we find that we are not equally served by the council. So I think the fear was that, as we were looking at the farm bill, we wouldn't prevent the opportunity for those parts of the country that were not served by this. Because we had some gaps in our area.
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I just wanted to speak to that and maybe have another round, Mr. Chairman.
Mr. LUCAS. Mr. Osborne.
Mr. OSBORNE. Thank you, Mr. Chairman.
This would be a question addressed to any or all of you. I am very interested in EQIP, because the livestock industry, as far as conservation is concerned, I think what I have heard would focus more on EQIP more than any other single entity that the Federal Government is involved with. And I know some of you have mentioned some changes you would like to see, and I would like to have you review specifically what changes in EQIP you would advocate and what level of funding. I think some of you talked to a higher dollar amount, so if we could be little bit more specific, I would appreciate that. Again, anyone who wants to answer.
Mr. SMITH. Well, I will go first.
We have communicators from very specific recommendations on EQIP within the past year, and I am very happy to share at least the highlight of our recommendations with you today.
I think there is unanimous agreement that we need to increase the funding substantially. It has been woefully inadequate. In fact, I have unfortunately some personal experience in being turned down on a number of occasions with EQIP contracts, and it has seen a tremendous amount of our field staff time being taken up developing contracts that are never funded. We are recommending that we increase EQIP funding to $1 billion annually. The need is far greater than that, and that certainly would go a long ways towards helping.
We would like to see a removal of the prohibition of expenditures being made in the same fiscal year as a contract's execution. The start-up costs and so on are hampering, particularly, small, limited-resource producers. It would be very helpful if there was an annual practices component within the EQIP program. Certainly not all producers and ranchers need elaborate 19-year contracts, and that would be very beneficial to the overall program.
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I think the last strong recommendation we would have is to remove the requirement of 19-year contract and look at something less than 10 when that is appropriate.
So those are our major recommendations.
Mr. OSBORNE. Thank you, Mr. Smith.
Any others have any comments on EQIP?
Ms. ADAMS. Congressman, we would also advocate removing the national size limit for those producers that can participate and also allowing for activities other than engineered activities that get the job done to be allowed for cost sharing.
Mr. OSBORNE. Do you see technical assistance being a problem in EQIP as well as other conservation programs?
Mr. SMITH. Technical assistance has been a problem in conservation in every program. We are all very concerned about programs like EQIP and having the adequate technical assistance. Many times that is actually preventing contracts from being implemented. So I would certainly urge the committee to make certain that the technical assistance for all of these programs, particular programs like EQIP, have the necessary technical assistance to make sure that they get implemented.
Mr. HAMPTON. Congressman Osborne, I serve on our State Technical Committee, and the regulation, which is very complex, needs to be streamlined more and gotten back to the local level. It is just very difficult for the farmers, especially the small ones, to be able to access funds to build waterways, to clean out their waterways, to prepare their terraces and build new terraces because of a complexity of the regulations of the program.
As I said, I have visited with many, many farmers, and I have yet to find anybody who has been able to access simply fixing their terraces and getting their waterways cleaned out. There has been some larger, complex issue that needs to be streamlined. Thank you.
Mr. OSBORNE. Thank you.
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I might just comment that when you are talking about one bill, Henry, you are talking annually for EQIP? One of the problems we will be faced with is I believe that the amount of money that is currently in the budget for agriculture over the next 10 years is something in the range of $170 billion, which is $17 billion annually, is what it averages out to. Coming up with $1 billion for EQIP alone may be difficult, but I certainly agree with you that it is a very critical program, and we need to do a better job with it.
Thank you. My time has expired, Mr. Chairman.
Mr. LUCAS. Thank you.
Mr. Baldacci.
Mr. BALDACCI. Thank you very much, Mr. Chairman, for having the hearing and to the panel for giving their testimony.
Just a couple of questions. I will start with Mr. Smith.
Mr. Smith, it looks like your request for increases in the conservation programs funded with mandatory spending out of the Commodity Credit Corporation adds up to about $1.7 billion per year. I was wondering if you assumed that various forestry programs would remain as discretionary programs that require annual appropriations, or would they be funded with mandatory funding?
Mr. SMITH. It is my understanding that those programs are not funded currently within the USDA budgets within the Appropriation's Subcommittee on Agriculture, and we work with VA-HUD on the Forest Service appropriations, and certainly I we think that that's where those expenditures should remain, and maybe I didn't understand your question.
Mr. BALDACCI. Well, it is just whether they remain as discretionary or mandatory funding.
Mr. SMITH. Well, I think it is totally separate from the mandatory CCC funding that we are talking about for these USDA programs.
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Mr. BALDACCI. Well, I think it is very important that forestry be part of the element when we talk about conservation programs and that the same level of assistance and commitment is provided to both when we are going ahead with the development of this particular title under the farm bill.
I would like to, first of all, thank the State of Kansas and their agriculture secretary for their testimony, because I really appreciate and like the idea of trying to develop a flexible block grant to the States. I know from your testimony it was kind of a work in progress, and there is not a final document yet, but what are some of the guidelines that you think ought to be part of that proposal?
Ms. ADAMS. It is fairly well along, and I have it from staff that it will be released in the next 2 or 3 weeks.
But the basic tenets of our program are that, first, it would be a block grant, as you have said, with the Department of Agriculture in each State being the lead agency in designing the program. It would also be based on local input in the local buy-in that the NACDs have talked about.
Second, we want to recognize all enhancements that protect land, water, air and wildlife in a very broad kind of way, so that if taking care of critical habitat is important in Wyoming but water quality is important in northeast Kansas we can take care of those issues in our States and spend that money on the issues that we see are needed in our States.
Third, as Congressman Osborne pointed out, there is a need for technical assistance, and we would ask that there be some flexibility there to allow the locals to decide how much goes to payments and how much goes to technical assistance. I do know as an administrator of an agency it is always often hard for legislators to accept that there is some administrative overhead and there are people. I mean, all the money in the world for programs doesn't do you any good if you don't have people to help farmers put it on the ground.
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Finally, we would agree with everyone on the panel that we need voluntary incentive-based programs, and they should have measurable results. And I think you can see measurable results as long as you understand that it won't happen overnight.
It is kind of like losing weight. You don't gain it overnight, and you don't lose it overnight, that you will see progress. We have seen progress in our State, but we started a decade ago. So as long as we remember that, I think that you can put performance measures on these activities, as long as you allow the process to play it out.
Then, finally, we are concerned and would suggest that individual producer privacy and data confidentiality be a part of that program as well.
Mr. BALDACCI. I have seen some of those commercials on weight, though, that it makes it look a lot easier than it really is, and I am sure that we are not advocating those kinds of efforts.
Then, looking at the Federal budget and recognizing the limitations that we have on the Federal budget, I think that it is going to be imperative that we have much more efficient Federal, State, local conservation district relationships in order to maximize those resources; and I would like to work with you and your association as you develop further on that.
Mr. Chairman, just in closing my questioning, I think that you all recognize on the financial front that we have got a backlog on EQIP. We have got a backlog on CRP programs. I think we have got a commitment to fill that backlog.
At the same time, I think it is going to be imperative to address these conservation issues, because we know that we need the assistance and the development in these particular areas. And I have always felt that in agriculture that we have always been asked to do an awful lot more in agriculture in terms of the environmental and conservation ethics. And I think those are important. And I want to continue those efforts, but I don't think that we have got a fair apportionment of the resources in some of the other environmental agencies for the Department of Agriculture. So I really would like to see if we couldn't be able to, within the budget constraints, be able to allocate more by developing a much more efficient, seamless relationship. All the way from Federal to local, and at the same time being able to put some additional resources.
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Thank you.
Mr. LUCAS. Good point, Mr. Baldacci.
Mr. Moran.
Mr. MORAN. Mr. Chairman, thank you.
Let me take this opportunity to thank Jamie Clover Adams, our Secretary of Agriculture, for being here and for her testimony and to commend Kansas during your tenure and during our governor's time in office of I think focusing lots of resources on environmental and conservation issues, particularly water quality.
I also would thank you personally. I think you have been a great advocate for Kansas farmers and ranchers, and I have not had that opportunity to say that either personally or publicly. So I appreciate your presence here, but I appreciate what you do in our State on behalf of farmers and ranchers and especially on behalf of the conservation and environmental kinds of issues that we face in our State.
It does appear to me that your testimony suggests that you prefer expansion and improvement of our current Federal programs as compared to a wholesale, radical change in the way that we deliver conservation services in Washington with, perhaps, the exception of adding the block grant program. Is that an accurate summary of your sentiments?
Ms. ADAMS. That is accurate, sir.
Mr. MORAN. I used the last hearing we had to talk about legislation that I have introduced that I think you have seen. As I read your testimony, the legislation that a number of us have introduced seems to me to be very compatible with your testimony, perhaps with the exception of we put a pilot program in for CRP, and it seems to me that it in some ways is the same kind of thing you are suggesting, only at a State level, to allow greater flexibility decisions being made at home. And I think I agree with Mr. Baldacci that that is an interesting concept that we ought to look at. So I thank you for you and your Association's point of view.
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What Federal programs in this area are most important to Kansas producers and most important to our environment at home?
Ms. ADAMS. Existing programs?
Mr. MORAN. Yes, ma'am.
Ms. ADAMS. I think both the continuous CRP for buffer strips, as well as EQIP.
As you are aware, there are a lot of small producers who are still running cattle on the streams, and that is causing some problem. If we were able to work with those folks and give them some assistance, perhaps provide a higher match, they would be able to move their animals off the streams.
I was out in Phillips County last summer, and there was a gentleman who had moved about 800 head off the crick, and that that EQIP, as you are aware, only paid for the waste treatment system but had nice new bunks and pens. We were chatting, and he took me out on the weeds to look at the lagoon. He said, I didn't do this for me. I did this for my grandson. And I think that is what we need to remember. As Joe Neal talked about, we need to get young people in agriculture, and the way to do that is to help their families stay in the business so they can pass it on.
Mr. MORAN. In deference to the chairman from Oklahoma and my friend, Mr. Osborne, from Nebraska, there is no State that has more cattle than Kansas, and I assume that changes in EQIP would be maybe our top priority, and I would ask you, where should we focus? And this was somewhat Mrs. Clayton's focus, is where should we focus? The smaller operators? The larger operators? It seems to me there are lots of challenges out there. Is there a size relationship between where those challenges are?
Ms. ADAMS. I think, Congressman, when you look at the data from our State, I think we need to look at where the environmental problems are. The fact that in the northeast corner of the State, lives 60 or 70 percent of the population and they get their drinking water from surface water, that is the place to start. If there are issues with other contaminations and other——
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Mr. MORAN. Regardless of whether they are small operators or large operators, it is where the consequences are the greatest.
Ms. ADAMS. Exactly and where you can show improvement.
I think the way we sell these programs to urban folks is to show them that there is progress being made; and, well, you do that by not putting it in because the rules say you put it in but because it is going to make a difference in the environment. And I think that is how you prioritize where are your problems and what is the best way to take care of them.
Mr. MORAN. Mr. Hampton, you mentioned the grass strips on terraces, as did Ms. Clover Adams. We have struggled with this issue for a long time. Continuous sign-up was available. The Department of Agriculture took that opportunity away. Through efforts, we added language into an appropriation bill in which we reinstated continuous CRP sign-up. The Department of Agriculture was not very happy in that regard. I mean, it has been a struggle to make continuous CRP sign-up on those terraces happen. Are things OK now? Is the Department of Agriculture performing to the degree that we think they should in this regard?
Mr. HAMPTON. I cannot address that particular point. I have no knowledge of that. But you are correct about the past. It just seems that the benefit of a grass strip for removing so much nutrients before it goes into our rivers and streams, it is just a great program; and we need to be able to utilize that as much as we can.
Mr. MORAN. The past Department of Agriculture has, I don't know whether to call it philosophical difficulties with this issue, because they believed that they were paying for the terrace, and it is a double payment if they then allowed landowners to receive the benefit for paying for the grass. It seems to me that the benefit are exceptional, both from a water quality but from a wildlife habitat. It is just an important program, but if anybody has any thoughts about whether or not USDA is complying with the congressional directives to make continuous CRP sign-up work, I would like to know, particularly if they are not.
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Thank you, Mr. Chairman.
Mr. LUCAS. Thank you.
Mr. Thompson?
Mr. THOMPSON. No questions.
Mr. LUCAS. Mr. Putnam?
Mr. PUTNAM. Thank you, Mr. Chairman.
I am also going to pursue a couple of questions about the flexible block grant. Do you think that there ought to be some special consideration for States that are on the cutting edge of developing their own conservation programs? Do you think that there should be a matching program for States to encourage more partnerships, and what are your thoughts on developing those?
Ms. ADAMS. I don't know that I would give special consideration for cutting-edge programs. I think that we should allocate the dollars. We are looking at working with some models on some various ways to distribute funds under the program as we have talked about it. But I think that we need to provide resources not only to States that are moving ahead like our State, like New York and New Jersey and many other States, but we also need to help those who maybe haven't had the resources to make things happen the way they need to.
As far as the match would go, we have discussed that amongst the members of NASDA. I didn't sense any opposition to that, but we are still in discussion on that concept.
Mr. PUTNAM. Well, that's essentially the same thing. I mean, if you are recognizing States who contribute matching dollars, then you are giving them special consideration over a State who does not make it as much of a priority.
Ms. ADAMS. I didn't think about it that way, but you are correct.
Mr. PUTNAM. Are you aware of, through your communication with your other State secretaries and commissioners of agriculture, of other success stories, that maybe their State has punished or penalized in the Federal dollars because of rules that the States have, or is there a need for us to be able to recognize the State programs that are out there and prevent those types of problems from happening?
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Ms. ADAMS. I think performance is the issue. If it is a program that is working and the environment is getting cleaner, we have better habitat, that should be the measure, not whether or not it meets guidelines A, B, C and D. So I don't know that there needs to be any special treatment given, as long as there is no hindrance to moving forward with programs that really make a difference.
Mr. PUTNAM. Does your State have a resource conservation agreement-type scenario, a less than perpetual conservation easement purchase or development rights purchase program?
Ms. ADAMS. That has not been used in our State. If you know the geography, we just don't really have the urban centers that would make that a priority in our State.
Mr. PUTNAM. For some of the other members of the panel, USDA testified in a previous hearing that their use of outside vendors was virtually nil. What are your thoughts on the use of outside vendors, and to what degree do you think that the farm bill will need to reflect an emphasis on using outside vendors to take the load off some of the technical assistance aspects?
Mr. SMITH. I think, as time goes on, we are going to see a much greater use of—we will call it third-party vendors—in applying conservation or in developing conservation. What we need to do is develop a mechanism for compensating them. Right now, if there is any compensation for these folks, it comes out of the pocket of a landowner or an operator, in lieu of perhaps some technical assistance from the Federal Government or from the State or local governments that might be pro bono.
So as the demand for technical assistance increases, as the supply of qualified folks from the Government to provide that assistance goes down, the gap continues to widen. And I think that we need to prepare ourselves for how to handle this growing group of third-party vendors that will provide those types of services.
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Mr. PUTNAM. So do you think that a scenario where the NRCS would certify a private land manager who could then draw up the technical assistance plans and that would be sort of a de facto approval by that outside vendor, would that not have the effect of reducing the backlog and saving the Government money on personnel?
Mr. SMITH. I know for a fact that is actually happening in some States right now. I know my own State of Washington currently has some outside engineers that are working within State and local areas but are being certified through the Federal engineers. So I think we are going to see that type of—and I would say that that is probably a very appropriate role for the Federal component to take, would be to provide the standards and the guidance and the certification required for perhaps third-party vendors to proceed.
Mr. PUTNAM. Thank you.
Thank you, Mr. Chairman.
Mr. LUCAS. Thank you.
Mr. Peterson.
Mr. PETERSON of Minnesota. Thank you, Mr. Chairman.
Ms. Clover, in your testimony—I am sorry. I wasn't here. I was tied up. But in the WHIP program, you recommended that we apparently rejigger the formula so that it carries out voluntary critical habitat enhancement. What is critical habitat?
Ms. ADAMS. As I understand it, under the Endangered Species Act, critical habitat is designated by the U.S. Fish and Wildlife when a species is listed as threatened or endangered, and then it is up to the landowner to provide that habitat, and we would just ask that that activity perhaps be a focus of the WHIP program. I know in our State we just had an endangered species listed, and a great number of acres along the Arkansas River that are designated as critical habitat for the Arkansas Shiner that our folks are going to have to deal with.
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Mr. PETERSON of Minnesota. So they would take and reallocate a lot of this money into trying to deal with the Endangered Species Act? Is that what you are basically saying?
Ms. ADAMS. That is as I understand——
Mr. PETERSON of Minnesota. That would take a lot of money, unless we change the Endangered Species Act.
Anyway, the testimony from Mr. Hampton on CRP—again, I am sorry I missed your testimony, but you don't look like you are a big fan of big track CRP, from what I can tell from your testimony.
Mr. HAMPTON. No, I am not.
Mr. PETERSON of Minnesota. Is that accurate? I just have to, I think, take issue with some of your conclusions that somehow or another that people are putting land into CRP is why there is less wheat production, which is what I surmise from glancing over your testimony. I don't know what it is in the rest of the country but in my part of the world the only reason those farmers are still in the area is because they had a chance to go into CRP because they cannot make money growing wheat, period. And that is the reality.
Up north, we don't have an alternative for wheat. So CRP has been a savior for us. It has been a good thing for the environment, for wildlife. We up in our part of the world think we ought to have more of it, not less of it. So I just wanted to put that on the record.
I also have to really take issue with the fact—it was kind of implied that somehow or another this had something to do with bringing in more imports. I would argue that it didn't take a rocket scientist to figure out what was going to happen when we signed the NAFTA agreement with Canada, and if they get rid of their Canadian Wheat Board, you ain't seen nothing yet for the kinds of wheat and barley that is going to come in from Canada, because we have opened up the border, basically.
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So, I mean, I think I could see some of your argument, but I think a lot of what is happening in wheat and barley is, in my opinion, is more of what is going around in this world market and all of this free trade that we have gotten involved in. And I really hope that people will really take a look at this free trade with America situation. If any of you that haven't been to South America, we are asking for trouble, it seems to me, if we get into another kind of dole with them like we did with NAFTA.
On the CRP, up in my part of the world and some other areas that I have been, we have been having problems with trying to deal with the kind of rigid regulations that have been put in place. I have been out hunting on CRP land where they are going to have to plow it up because in order for them to get enough points to get into the CRP again, they have got to plow it up and plant this seed mix that is required, and in a lot of these areas, it is not going to grow, and so we are going to take perfectly good CRP and destroy it, and we are going to replant it with something that is not going to work and have a mess, and there is no mechanism under the current situation for us to deal with that.
Now, some of you have talked about having flexibility at the State level. I am not sure that is even far enough down the chain. I think maybe the county level. Do you support giving us some flexibility so we can make the CRP fit the local situation?
Mr. SMITH. Well, I would very much support your suggestion, and we have commented and included in our testimony that that is a perfect example of a Federal program that needs to have flexibility at the local level. And it is the districts across America's suggestion that these are the kinds of decisions that would be better made at the local level.
But keep in mind that in order to be accepted in the CRP program an operator had to agree to do those things. And the problem probably is not the selected varieties of grass required, although that is a problem. The problem is far greater than that in that we need to take a look at how that whole program was designed with the environmental benefits index and develop a program that truly reflects the benefit to the environment and start the redesign from the top down and then allow the flexibility at the local level.
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Mr. PETERSON of Minnesota. Thank you.
Mr. LUCAS. I believe that concludes the first round. Mrs. Clayton indicated that she might have some additional questions.
Mrs. CLAYTON. My questions were answered. Thank you.
Mr. LUCAS. Any other members have any additional questions?
Mr. PHELPS. Thank you, Mr. Chairman.
Mr. Smith, you know, the need for responding to regulatory requirements on agriculture producers, both by States and what has come down the pike from the Federal Government, we hear the need for work in areas that encourage conservation tillage and basic technical services. As we fashion funding and the tough decisions that we are going to be making, how do you propose we balance that sort of a consideration to provide the technical assistance that is needful and yet the regulation says imposed?
Mr. SMITH. We have worked ourselves into a bit of a problem with the allocation of dollars for conservation, as I am sure the committee is probably more aware than any of us. An extraordinary amount of the percentage is going towards land retirement right now; and, unfortunately, a smaller percentage is going towards our working lands.
I think we need to take a hard look at that mix, and certainly I am a strong supporter of all those programs included in the retirement category, but we are woefully underfunded on things like technical assistance on our working lands, and the best defense that those of us that are on the farm have against the environmental pressure that is increasing daily is to be accountable. We all want to be accountable. We want to do the things that are right.
And I don't have to tell the committee the state of the economics in agriculture, but our folks out on the farms and ranches across the country desperately need help. We need the technical assistance, we need these incentives on our working lands, and I would hope that the committee could take a look at the balance and try to redirect some funds or find whatever way you can, additional dollars, to help those producers on the working lands and allow them to be accountable to the public, which is what we all want to do.
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Mr. PHELPS. So essentially, if I hear you right, maybe look at some of the requirements, the environmental requirements and loosen up some of those that make it tough? We are trying to stretch the funding. How do we address both of those extremes?
Mr. SMITH. I am not suggesting that we loosen up any regulations that are necessary. What I am saying is we need to provide the incentives so those of us out there can make the right decisions and do what is right.
If we have got the input at the local level to make sure that what we are suggesting or requiring is economically feasible and locally accepted, those of us out there will gladly implement these things with some help. What happens is when you get Federal mandates which make no sense down at the county levels is where we run into some of our problems. And you need to safeguard against having regulations required that make no sense locally. But, I mean, we all want to do what is right.
Mr. PHELPS. Can you give me an example of just one?
Mr. SMITH. Well, I think you just heard the example on requiring a species of grass that doesn't fit the area. Those are the types of examples that we need to do, the conservation incentives program. We need to make certain that the funding levels, the requirements and those thresholds are set locally so that our folks down at the county levels can make certain that what they are doing is appropriate and the right thing to do.
Mr. PHELPS. Thank you.
Mr. LUCAS. Thank you.
A couple of quick questions, and we will thank the panel for your efforts.
Mr. Smith, in your comments, you mentioned in the proposal that an extra billion dollars for EQIP, and I think the way the written testimony was worded, with 20 percent of that being set aside for technical assistance, how would your proposal assure that the personnel would be available to write those EQIP plans? Would it specify that the NRCS chief assign so many people to do nothing but write EQIP plans during a fiscal year? How would you address that in the concept? Because we have talked about the shortages of personnel and resources and how we meet the needs that exist, let alone putting more resources in to meet those needs.
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Mr. SMITH. Those are really difficult questions, and as we allocate EQIP dollars across the country, I think the problem is finding the proper allocation formula for making sure that the dollars are going where the problems are. And we heard it earlier that we don't want to attack our problems with programs. We need to find out where the problems are and develop plans that will solve those problems.
EQIP is a perfect example. I know that the NRCS would be thrilled to adequately provide the technical assistance for EQIP if it was adequately funded. The problem is, I am not sure the 19 or 20 percent, the way the program is designed right now, is adequate. And I think with EQIP, for example, that is probably the problem, because there is no mechanism for the time a contract isn't accepted is paid for. It requires a tremendous amount of time from a conservationist to develop an unfunded contract, and who pays that bill when the contract isn't even signed?
So I think these could all be fixed if we can make some changes within that program to streamline that so we minimize particularly the time that is required in an unsuccessful contract. And those things can all be fixed if we can all get together and do what is right.
Mr. LUCAS. My next question I would, I suppose, primarily direct to Secretary Adams but to the whole panel. I spent 5 1/2 years in the State legislature before I came to Congress 7 years ago, so I have worked through the priority setting process in State government and have a huge fondness for both State government and local government.
But let me ask this question of you all in the concept of either block grants or moving more of these resources and concept programs to the local level. How would we determine the local conservation priorities would be met within States, communities, whatever? Sometimes State legislatures have a unique concept about how things are to be done and should be done and do in their conference committees make decisions that are amazing even at home. How do we, if we go down this route, make sure those priorities are properly addressed with those Federal dollars we would be sending?
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Ms. ADAMS. I think one thing is to hold folks accountable and have performance measures. At least in our State—and I get the sense from my colleagues in other parts of the country that the reason and the way that States are stepping in is because of mandates from other laws, like the Clean Water Act, like the Endangered Species Act and other acts such as that. And if the State legislatures somehow try to circumvent the use of that money, the landowner is the one who is going to pay the price in the end. So I think there is some incentive there to be accountable.
I also think the contract I have with vendors with my agency is there is accountability, and if you are not accountable, you don't get the money. And I think that is very, very important when it comes to taxpayer dollars. We have to show results. As long as they understand that it is not going to be tomorrow, that it might be 5 or 10 years down the road, but everybody is better off.
Mr. LUCAS. Every one of you sitting at table has had some involvement or dealings with the Federal Government or Federal programs. My follow-up question to that is how do we make sure that USDA doesn't shift staff away from current programs to oversee and implement these kind of concepts, reshuffling the eggs, yet fewer things are done with real producers out in the field?
And, oh, by the way, I love those legislators who are drawing my congressional district lines right now in Oklahoma, for the record. Brilliant people.
Mr. SMITH. Mr. Chairman, I think that the answer is as we develop these programs, which have far-reaching impacts from the Federal level clear down to the local level, we need to develop a procedure that will create some Federal guidelines and keep the States and the counties and the districts within certain parameters, and then at that level create a second set of parameters that will allow continued flexibility as you go down the chain, keeping the vision that you would have here within the committee and allowing for the flexibility at the State and the local level to carry out that vision.
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Mrs. CLAYTON. I do have another question.
Mr. LUCAS. Mrs. Clayton.
Mrs. CLAYTON. I said I didn't have, but now I do have. A couple of comments that the Chair made made me think about the discussion.
The accountability and the coordination and the oversight all are related, and we try to find out how we don't be constraining and allow for some flexibility. But I sit as the ranking democrat on the oversight committee, and the allocations of dollars to EQIP, who used it, how it was used, you cannot have that unless there is some understanding about that. Just as the State has oversight, if the Federal dollars going out has oversight—and I know when the State allocate their dollars, they have oversight to local governments. So it is with local governments to agencies. I don't think you are not suggesting that you don't have some oversight or accountability, but you want the maximum flexibility within that, and I understand that. And that to me almost is complete discretion. But we have to have guidelines for the utilization of those resources.
The other point I wanted to make is that in our environmental laws as they are changing and become more demanding, as consumers become more discrete in and demanding in what they eat and how we grow and produce that, they are also doing that in other industries, not just food, but in agriculture. We find ourselves meeting it in several ways, not only in the end product of processing but in the production of it where Ms. Adams talked about the livestock being close to our body of waters. In my State, we have large hog farms which indeed impact on it.
So you also begin to have environmental laws coming from other agencies that also impact the farmers or local units of government, and I know the natural resources staff has been working. I know in our State that is the case. If you add to that a calamity that may happen to happen, a storm or a drought, and now you are having to coordinate with different agencies and implement all these programs we have here, there is a point as how many programs can we efficiently and responsibly allocate and how should our coordination be.
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So I just want to make the observation there is a staff resource and capacity resource in our ability to really implement what we put on books. So we just shouldn't check which can put the program dollars out there without some accountability. And we can't do those well unless we coordinate with other agencies that have some overlapping responsibility, rather, the State or the Federal agencies as well.
Now, that wasn't a question. It was a comment.
Mr. LUCAS. Thank you, Mrs. Clayton.
You brought to mind one more question from me, and this will absolutely be the last question. We talked about incentive payments, and EQIP currently has an incentive payment option. Is it inadequate? Or what changes could be made? One last question to the whole panel. Looking at the incentive payment options within EQIP, is it inadequate, and what changes could be made to help producers?
Ms. ADAMS. Mr. Chairman, while my agency is not responsible for implementing those programs, in my conversations with our State Conservation Commission, they are finding that there aren't a lot of takers with EQIP currently in our State, and much of that has to do with the size of the match and the current situation in the farm economy.
Mr. SMITH. Apparently, this incentive component within EQIP, someone needs to take a hard look at it, because those of us that have applied for contracts and even have contracts aren't terribly aware of it or even utilize it. So I would suggest that there probably is something wrong, since it is being underutilized.
Mr. HAMPTON. Congressman, we would like the EQIP program to be amended to allow payments to producers during the year the contract is signed. Current authority disallows that, and it impedes investment in necessary environmental technology and delays the benefits.
Mr. LUCAS. Thank you.
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Mrs. CLAYTON. Mr. Chairman, this is my last.
I want to tell you that the last statement Mr. Hampton made, I have had minority farmers say to me why they don't participate, particularly socially disadvantaged farmers who are the minorities now, they can't afford to wait that long. They can't put $10,000 and get it 2 years later. They don't have that margin of operation. So I just wanted to acknowledge that that has been a concern raised by the farmers in my area.
Mr. LUCAS. With that, the subcommittee appreciates the insights and the variety of responses from the questions the panel has answered and provided input on. Thank you for your attendance today, and we look forward to working with you to help make some positive things continue to happen in production, agriculture and in conservation in this next farm bill. Thank you.
If the next panel will come forward. We have Mr. R. Max Peterson, executive vice-president of the International Association of Fish and Wildlife Agencies here in Washington, DC. We have Mr. Craig Cox, the executive vice-president, Soil and Water Conservation Society from Iowa; and Mr. Jeff Nelson, director of operations for Great Plains Regional Office, Ducks Unlimited, Inc., Bismarck, ND, on behalf of the Sportsman Coalition; and Mr. Ralph Grossi, president of the American Farmland Trust, Washington DC, on behalf of the Coalition of Conservation and Environmental Organizations.
Mr. Peterson, whenever you are ready, you may begin, sir.
STATEMENT OF R. MAX PETERSON, EXECUTIVE VICE-PRESIDENT, INTERNATIONAL ASSOCIATION OF FISH AND WILDLIFE AGENCIES, WASHINGTON, DC
Mr. PETERSON. Thank you, Mr. Chairman.
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You have my testimony. If you will accept it in full, I will try to brief it for you and save you some time.
Mr. Chairman, I do represent the 50 State fish and wildlife agencies that have been involved in these conservation programs since the beginning. I would also acknowledge that some of us here with more gray hair than others were part of the 1985 farm bill, but we have followed these through the years, and let me acknowledge that I think these conservation provisions of the farm bill, beginning in 1985, have done a tremendous amount of good not only for farmers and helping stabilize income but in terms of conservation. As you go about the country, there is wildlife abounding in places where it was not really present in very large numbers before. We see streams running clear that one time were running muddy.
So much of my testimony deals with the fact that we think we have made a great many improvements over time in these conservation reserve programs, and I would be the first one to acknowledge that they are not perfect. The point that in some places we are still having problems with the right grass mixture is something that we dealt with I thought 15 years ago to empower State Technical Committees, working with local counties, to be sure they got it right, but we still find places apparently that we—the half life of knowledge I am absolutely convinced is about 6 or 7 years. You solve the problem once, and it comes back to bite you.
So one of the suggestions that we make in our testimony, I think if we had some kind of a threshold level of qualifications for some of these programs and then allow flexibility to design within our threshold level. I have never been really comfortable with computer programs making the final selection, but it does seem to me that there does need to be some weighing of conservation benefits between different kinds of land. I am not sure how you do that without some kind of an attempt to do it through an index or some system of weighing one piece of land against the other, but I have always been concerned about the idea that you get the precise answer by using a computer program. I would much rather have State or local people out there with some kind of a threshold level look and say, yeah, here is land that qualifies, but this one is better than this one over here, or if we could do this to this land, it would be a substantial improvement.
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One of the concerns over the years is how do you relate these different programs, like CRP, WHIP, Wetland Reserve Program and so on. There again, I would give States much more flexibility in tying these programs together at the local level, because a farmer may have both some wetlands, he may have some land that qualifies for CRP, he may have some land that would qualify for EQIP. There ought to be a way to package that that would make sense to the farmer. Because now it happens at different times and different standards, and you aren't really sure what kind of a program you are going to get till the dust all settles. So I think there is some opportunities to improve that.
In my testimony, we have made recommendations for different levels of the different programs. We recommend that CRP be expanded from 36.4 to 45 million acres, that the wetland reserve program, we increase the authorization by 250,000 acres a year. As you know, that is completely used up now. We believe that WHIP, which has turned out to be a tremendously beneficial program, be authorized an expenditure of a hundred million acres, because one thing that WHIP does, it allows sort of a custom design of a program to fit a particular farmer's operation and fit the wildlife needed there as well as the other conservation programs.
There is a proposal that we have been working on for several years for a grassland program. There is a lot of grassland out there that is in existing cover that is highly beneficial. As Congressman Peterson says, who has been in this about the same time I have, it never makes any sense to me to plow up one piece of land in order to put another piece in. And I am sure it doesn't make any sense to the farmer either. So it would be very helpful if we could have a grassland program that would specifically recognize the benefit of grasslands.
Finally—and just suggestions of improvement—the continuous sign-up program, I have a brother in Missouri who is in the real estate business. He deals with this all the time. There is very small acres involved there. So you really can't use standard rental rates and so on. That has to be developed in more of a custom-made program.
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Finally, we believe that both the Farmland Protection Program and Forest Stewardship and Forest Legacy should be part of this program and not separate, because sometimes farmers want one of these and not the other, and it would make sense to be able to get one as a mandatory but they have to wait and see if there is an appropriation for something else.
That completes my brief on my testimony, Mr. Chairman.
[The prepared statement of Mr. Peterson appears at the conclusion of the hearing.]
Mr. LUCAS. Thank you. Mr. Cox.
STATEMENT OF CRAIG COX, EXECUTIVE VICE-PRESIDENT, SOIL AND WATER CONSERVATION SOCIETY, ANKENY, IA
Mr. COX. Thank you, Mr. Chairman and members of the committee, for being allowed to speak to you today.
We have submitted written testimony. We have also released a new report this morning that we have provided to the committee that presents detailed recommendations for what we would recommend for reform of both conservation and farm policy in the next farm bill.
But in the few moments I have in front of you, I would like to try to rise up to the challenge you gave us, Mr. Chairman, to talk about conservation in the context of a comprehensive farm policy.
What I am going to say is based on a series of five workshops we held around the country where we invited grassroots leaders from agriculture, water resource and fish and wildlife communities to share their ideas with us about how to fix what we have in conservation policy, and we also asked them to imagine they could wipe the slate clean and start from scratch. We have taken their ideas and attempted to shape them into specific recommendations that would be of use to you as you struggle with the decisions you need to make.
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My basic message would be that we think we are missing a critical opportunity in agricultural policy to both help keep people on the land and care for that land at the same time, and we think the reason that we are missing that opportunity is because conservation policy is unbalanced and farm policy is unbalanced. Conservation policy is unbalanced because we have to rely too much on one tool, which is taking land out of production for conservation pumps.
Farm policy is unbalanced because, again, we have to rely too much on one tool, which is trying to affect the price of a selective set of commodities or subsidize the income of those producers who produce a selected set of commodities. As a result of those two imbalances the reach of agricultural policy is seriously limited, and it simply cannot help keep people on the land and care for the land in the way that our workshop participants envisioned that agricultural policy ought to be designed to do.
Now, we think we can correct this imbalance but that in order to correct that imbalance and really make conservation a force for helping keep people on the land we are going to have to look at fundamental reform of both conservation policy and agricultural and farm policy.
On the conservation side, we need to double funding for existing conservation programs at about $2.5 billion more but spend most of that new money on technical services and on assistance to landowners that are trying to keep farming and not take land out of production. That doesn't mean we don't support the CRP and WRP. In fact, we make room in our $5 billion budget for a 30 percent increase, over $500 million increase, for those functions. But the major emphasis on new investment has to be technical services and financial assistance to help those farmers that want to keep farming but do so in a more environmentally sound way.
Now, we detail a number of other specific recommendations for program reform in our testimony in the report that I refer you to, but let me now jump quickly to farm policy reform.
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If we did what we just recommended in terms of conservation policy, we would make a huge step forward in ensuring that commercial viability of action and environmental quality are compatible goals, but that is not enough to achieve the vision that our workshop participants gave to us.
To do that, we think we really need to make room in farm policy this time for a program that is based on stewardship rather than based on the collection of commodities that a producer happens to produce. We see stewardship contracts as being worked into farm policy in a way similar, perhaps, to production flexibility contracts. But instead of that production flexibility contract being—the payment being calculated based on the historic mix of a selected set of commodities produced, the stewardship payment would be based on the level of conservation benefit a producer is willing to do and to produce environmental benefits for taxpayers.
About 8 percent of farmers currently receive over half of all the farm subsidy payments, while operating about 32 percent of the farm acres in this country. We think a stewardship contract, as part of farm policy itself, would be a way to balance farm policy and reach out to all of those agricultural producers who do not receive lots of subsidies from current programs but who do manage most of the landscape in this country.
Thank you, sir, and members of the committee.
[The prepared statement of Mr. Cox appears at the conclusion of the hearing.]
Mr. LUCAS. Mr. Nelson.
STATEMENT OF JEFF NELSON, DIRECTOR OF OPERATIONS, GREAT PLAINS REGIONAL OFFICE, DUCKS UNLIMITED INC., BISMARCK, ND, ON BEHALF OF THE SPORTSMAN COALITION
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Mr. NELSON. Mr. Chairman, members, I appreciate the opportunity to address the committee. We have submitted written testimony, and so I am just going to quickly summarize what we had to say.
I am a professional biologist by training, and I work for Ducks Unlimited, but this testimony comes from just more than Ducks Unlimited. I grew up on a dairy farm in Minnesota, and so I have a farming background myself, and I have also worked in both the United States and Canada, mostly in the prairies.
Ducks Unlimited, as you may know, has grown from a handful of people in 1937 when it was founded to an organization over a million supporters that have helped conserve nearly 10 million acres of habitat across the continent. We take great pride in our work with private landowners, in our ability to assist and advise farmers, ranchers and foresters on how they can meet their economic goals while providing habitat for wildlife.
Importantly though, today I am representing the views of a broad coalition of about 40 conservation organizations with their interests being represented by nearly 10 million members. These organizations represent a spectrum of interests that have come together to support continuing a strong conservation tradition in U.S. agriculture policy. The groups I represent today include the Nature Conservancy, the Congressional Sportsman Foundation, Pheasants Forever, NRA, The Wildlife Management Institute and others. Collectively, our members and supporters represent a sizable cross-section of our Nation's citizenry. You will find a list of the organizations on the title page of our written testimony.
The future of wildlife in this country is inseparably tied to actions undertaken on private lands. Agriculture is by far the dominant use on these lands, with about 50 percent of the United States, or 900 million acres, managed as cropland, pasture or rangeland. Thus, Federal agricultural programs and policies have an enormous influence on the condition of our Nation's air, soil, water, plant, wildlife and other natural resources. In recognition of this fact, Congress incorporated strong conservation titles in the 1985 farm bill and has continued this approach in each of the last two farm bills.
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Over the past two decades, conservation programs have played an integral role in the economic vitality and general well-being of our Nation. In addition, they have improved conservation of private lands by enhancing and protecting wildlife and their habitat. The increased role and importance of conservation in agriculture and its role in private land stewardship has given way to a dialog that, while contentious at times, has led to consensus and partnerships among Government and private interests, including commodity groups, individual producers, livestock organizations and the conservation community as a whole.
Voluntary, incentive-based conservation provisions included in national agriculture policy have provided the framework for win/win solutions on the farm and across the rural and urban landscape. Our organizations are united in their belief that this Congress should strongly support continued commitment of our Federal resources to farm bill conservation provisions.
I will present four areas of focus, followed by brief descriptions of the specific farm bill conservation programs and the rationale for including them as we go forward. The Coalition is united behind these four areas of focus, and they lie in no particular order.
We would like to see expansion of the Wetlands Reserve Program to accommodate enrollment of 250,000 acres per year through the duration of the next farm bill.
Second, we would like to see the restoration of the enrollment caps for the Conservation Reserve Program to its original 1985 level of 45 million acres.
Third, we would like to see expansion of the WHIP Program to authorize expenditures of $100 million annually.
And, fourth, we would like to see the development of a new Grasslands Reserve Program, which would authorize up to a million acres for enrollment and that would be targeted to some of the native grassland areas that we still have out there.
We urge you to continue and expand these agriculture programs with the addition of the Grasslands Reserve Program, because they have been proven to be successful in achieving recent conservation gains and provide critical options for family farmers. Farm policy that includes wetland and grassland protection features, like swamp buster and sod buster, in combination with other voluntary incentive programs like I discussed, comprise a package of conservation provisions that, taken together, promise future success based on a strong tradition of natural resource stewardship.
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Farm policy must address both the immediate and long-term needs of our Nation's producers. Producers must be able to survive and hopefully prosper while they work to provide food, fiber and shelter so important to our qualify of life. The conservation of soil, water, wildlife, and other natural resources requires a long-term strategic view, and this subcommittee has a special challenge to try to incorporate these sorts of things into farm policy.
I would like to thank you with that for the opportunity to provide comments as you continue to deliberate on conservation in the next farm bill.
[The prepared statement of Mr. Nelson appears at the conclusion of the hearing.]
Mr. LUCAS. Thank you. Mr. Grossi.
STATEMENT OF RALPH GROSSI, PRESIDENT, AMERICAN FARMLAND TRUST, WASHINGTON, DC, ON BEHALF OF THE COALITION OF CONSERVATION AND ENVIRONMENTAL ORGANIZATIONS
Mr. GROSSI. Thank you, Mr. Chairman.
I am a dairy farmer and cattle rancher from northern California, and for the past 16 years, I have also served as president of the American Farmland Trust. Today I am here to testify on behalf of 16 national and regional conservation and farm organizations representing more than 10 million Americans.
Our fundamental message to this committee today is that conservation should be the focal point of the next farm bill. Rewarding farmers for environmental stewardship can promote rapid progress on a wide range of critical national environmental objectives. Private crop, pasture and range lands account for more than 50 percent of the lands in the contiguous United States; and private forests account for another 20 percent.
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Farmers and private forest owners can provide not only food and fiber but also clean water, habitat for native wildlife and a barrier against sprawling development, as well as other public benefits.
Mr. Chairman, I want you to grasp the gravity of this moment that you have, this moment in time, to recraft farm policy in this country. The American consumer is not demanding more wheat, corn and soybeans. The American consumer is demanding clean air and water, wildlife habitat and open space around their communities. The next farm bill can provide the funds to help farmers achieve those needs of all Americans. The Agriculture Committee has a historic opportunity to craft the next farm bill in a manner that properly recognizes the importance of the private landowner.
Because in its budget resolution Congress has made an average of $21 billion per year available for a 5-year farm bill, this committee does have the resources necessary to craft a bill to address private stewardship challenges in a way that is appropriate to the scale of the need.
And the desire among landowners is great. More than half of all farmers seeking technical assistance to enhance stewardship are turned away. So, too, are three out of every four farmers seeking help from the EQIP program to improve water quality. There is a backlog of 560,000 acres of wetlands to be submitted for restoration for the Wetland Reserve Program, and approximately 4,000 farmers and ranchers in the path of sprawl are willing to sell their development rights. The oversubscription to the Farmland Protection Program this year was 6 to 1. There clearly is a need and a desire by landowners to do something. The response has to start in committee. They are turned away because conservation spending since the last farm bill as a percentage of direct aid to farmers has greatly declined, from about 30 percent in 1996 and 1997 to 6 percent in the last fiscal year.
A new farm bill should focus $11.8 billion per year on conservation programs and stewardship incentives, as well as programs for research, marketing, and rural economic development that support independent and resource-conserving farmers.
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A reoriented farm bill can help meet a broad array of challenges and help farmers, ranchers and foresters attain the environmental quality that the public is demanding. There are numerous areas and specific recommendations that we can make to you, but in the interest of time I will skip through those and just mention that the highest priorities I think clearly are in the areas of water quality, in sprawling development and preserving prime and unique farmland, safer food and confidence in that food supply, native wildlife and endangered species, enhancing pasture and rangeland in this country, as well as our private forest lands, and in the area of climate change, where many of the practices that reduce polluted runoff or enhance wildlife habitat also help sequester carbon, turn methane into energy, reduce nitrous oxide and otherwise reduce gases that contribute to global warming.
Federal programs can help farmers develop markets as well to solve verifiable true reductions in greenhouse gases to industry.
Current farm programs are lacking in many ways, and you have heard this from other members on this panel. And I think it is important to note that nearly two-thirds of all producers currently don't receive any direct support. A broad conservation title can do much to help farmers and communities address their needs. But, again, it has to start at this committee. Of the $21 billion available, roughly half should be made available for these programs to provide stewardship payments, to buy easements on threatened lands, to create incentives for farmers to enhance and preserve grasslands and, importantly, to increase the technical assistance needed to deliver those programs to respond to those needs.
If you don't respond to this need to help individual landowners, the public will force more rules and regulations on those private landowners. We know they are demanding these services, and they will get them one way or the other. This leads to more conflict over the use of lands and how lands are used and, to resolve that, we have to find ways to make private landowners partners with the public in achieving them.
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Thank you.
[The prepared statement of Mr. Grossi appears at the conclusion of the hearing.]
Mr. LUCAS. My first question would be—perhaps those organizations, Mr. Peterson and Mr. Nelson, who have advocated going back to the original CRP target number, 45 million acres. Have your organizations taken into consideration when preparing your positions on these concepts not only the potential impact on soil and water conservation and wildlife but also the economic and cultural impact on the areas in rural America where the majority of these acreages are or would be?
Mr. PETERSON. Yes, we have. We believe that the economic impact would be positive.
If you look at where CRP has been used now, it provides a supplemental source of income for people. It provides some assurance that there be money there to pay debts to banks and so on. So I think you will find in the communities where CRP is important, by and large, it has been positive in that community. It has always brought people into the community to hunt and fish and otherwise recreate, which is one of the fastest-growing types of recreation in the United States today is related to wildlife. That is, in fact, the fastest growing. So, yes, we have looked at that, and we think it would be positive.
Mr. NELSON. We would agree with that. In fact, we looked into the idea that CRP has somehow contributed to the decline of small-town America in the rural landscape, and in fact we looked in North Dakota and found that a number of acres of cropland has not gone down since CRP was initiated. It has actually gone up. And what CRP really replaced was foul grounds. So that land now, instead of eroding in sort of a foul kind of a system, has been taken under production and put under grass and created all the benefits CRP creates. Whereas, it has an impact, either the bush was harvested or the acres and cropland.
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The other thing I might mention is we work with our Canadian counterparts where they don't have CRP, and the same trends are occurring across the prairies of Canada as you see in the great heartland of the United States in terms of agriculture and the towns that rely on agriculture. So I agree with Congressman Peterson that I think there is a lot of information that we have indicated is a positive benefit and not nearly negative as some would have you believe.
Mr. LUCAS. Mr. Cox, your organization stewardship-based option for agriculture, you mentioned that it would involve the say of local producers and citizens with guidance from USDA's State Technical Committees in establishing what the minimum bar would be for producers to pass to be eligible for the payments. Would you expand for me just a moment how the concept envisions those agricultural producers playing a role in this process of determining what environmental issues would qualify to receive assistance?
Mr. COX. Well, I think we are attempting to bill on the model that has been used for the past 60 years, frankly, in working with agricultural producers and community at the local level to help direct how USDA conservation programs are spent.
The State Technical Committees, in our view, would be the go-between, frankly, between the local communities and the Federal Government. It would be their responsibility to help mesh the priorities that are established at the local level with the priorities that are established at the Federal level to assure Federal taxpayers that the dollars they are investing in these conservation programs actually meet significant State environmental or national environmental goals. So that is how we see the State Technical Committee playing.
At the local level, conservation districts, watershed councils, FSA committees, these local folks have been involved for decades, often involving producers themselves in helping to set priorities for what conservation spending ought to be.
Now, there are two recommendations I think you may be talking about at the same time. The second recommendation, we feel that issue of what taxpayers ought to be expected to pay for versus what farmers or ranchers ought to be expected to do as a responsibility of land ownership is going to arise as a significant issue in the implementation of this program, especially if billions of dollars are put through this pipeline as we recommend, the $3 billion program. This kind of issue has already been raised in programs like EQIP, where operators above the thousand animal units have been excluded from assistance for some portions of EQIP.
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We think the way around that or the most creative way around that would be to have agricultural producers and local citizens decide in their local community what ought to be expected as a minimum land stewardship from farmers and ranchers and pay for efforts in addition to that.
Mr. LUCAS. So you envision the local entities being on par with the State Technical Committees or being recipients of their decisions?
Mr. COX. Well, I actually think that is sort of a false dichotomy. I don't think we send to set these things up as local versus Federal or top down versus bottoms up. The fact is, we need both. That is the only way you can achieve accountability to taxpayers and flexibility to local citizens simultaneously.
There is this tension between local control and accountability is a necessary and desirable part of a system that relies on local, State and Federal partners. I don't think there is any way to—I don't think you can choose the grassroots versus the top down. You have to make that process transparent and as participatory as possible.
Mr. LUCAS. But as in the nature of any governmental process from which the majority of the money flows, generally flows the majority of the control, too.
But we will have time to visit with this in another round. I now turn to Mrs. Clayton.
Mrs. CLAYTON. Well, I, too, want to focus on this. I was struck by your first—what was it we needed? A new vision? What was that? We had an opportunity for a new vision?
Mr. COX. Yes, ma'am.
Mrs. CLAYTON. And that the dichotomy of where we are now is how we are approaching our farm program is we have taken land out of production, that that's how we take care of some conservation and how we take care of fluctuation in the market, we support local commodities. That is where you have summed up what we are now doing. Right?
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Mr. COX. That is correct.
Mrs. CLAYTON. Now as we move to get the balance, we would use those tools. We would talk about the current tools you see us using. If those tools—the status quo, and we want to move to a more envisioned and enlightened farm bill.
Mr. COX. Right.
Mrs. CLAYTON. Help me understand how we move from the price quota for certain commodities and how we achieve a sustainable, safe environmental land and not use our current tools.
Mr. COX. I will try, ma'am.
Mrs. CLAYTON. I just want to understand where you are.
Mr. COX. I understand, and I will try to address your question.
On the conservation side, let me address that first, and then I will talk about the farm policy side. On the conservation side, the CRP and the WRP are very excellent, effective tools. In fact, they demonstrate what enough money can do.
Mrs. CLAYTON. So those two you see as being adequate?
Mr. COX. So those should be retained, and in fact we would propose increasing their reach. But we would see the major expansion on the conservation side being in programs like EQIP that are helped to design people that are producing food and fiber do so in a more environmentally sound way and with a primary emphasis on technical services. By that I mean research, education, technical assistance. We actually see that as the fundamental conservation program.
Mrs. CLAYTON. So you would substitute technical assistance from what we are now doing in the EQIP program?
Mr. COX. Well, I think we need to change the way we think about technical assistance. Too often we see it as a cost of delivering financial assistance. That is not how we see it. We see technical assistance as the basis of conservation, with financial assistance being something that makes it easier for farmers to do conservation.
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So we would change the emphasis to put technical assistance at the core and then use these financial assistance tools to help farmers do what they now know how to do in terms of changing their operations on the farm policy.
Mrs. CLAYTON. So you would put in more incentives to encourage good environmental behavior that farmers are now doing? Is that what you are saying?
Mr. COX. I would focus EQIP on helping farmers adopt production systems that produce crops or livestock that integrate conservation practices directly into those production systems so that the process used to produce food and fiber produces environmental goods and services at the same time. That is what those sorts of programs ought to be directed to doing, and technical help is absolutely critical to making that happen, in fact, more important in many cases than financial help.
Mrs. CLAYTON. So would you, therefore, give more resources to capacity building for technical assistance within natural resources?
Mr. COX. If you start from the 2000 year funding, our $5 billion proposal for conservation programs—as opposed to $3 billion for farm programs would be—we would double funding for technical services to about $1.75 billion a year. We triple fund for what we call assistance to working land, programs like EQIP, to about a billion a year. And we would increase the land retirement programs by about 30 percent to $2.25 billion. That is the sort of balance we think would actually create a fully functioning conservation program enterprise effort within the Department of Agriculture.
On the farm policy side, what we have seen in terms of our looking at the data is that there have been fundamental changes in the structure of agriculture. And because our basic commodity subsidy programs follow production, as production of those subsidized commodities has focused on fewer farms and fewer acres, so have the subsidies. And what has happened is because of that there is a large portion of agriculture, most producers frankly operating most acres, that do not benefit that greatly from our current commodity subsidy programs.
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That came through loud and clear in our workshops. And what we see is our stewardship contracts being a viable way for the Federal taxpayer to engage with those agricultural producers, provide them help to keep them on the land by paying for what they are already doing, and also paying for them to do more than they are doing now. So that is how we see the stewardship component being fit into farm policy.
Mrs. CLAYTON. Thank you, Mr. Chairman.
Mr. LUCAS. Thank you. Mr. Kennedy.
Mr. KENNEDY. Thank you very much. And I appreciate your good testimony and I was happy to be part of one of your forums, Mr. Cox.
And part of what I have been hearing through a number of panelists, both this panel and the last panel, is the need for more flexibility at the State level. And I found that whenever we have glitches in the States' flexibilities to deal with these they can be more creative and innovative than we can be sitting here in Washington.
What ideas do you guys have, and I will open it up to comments, on how we can encourage innovation at the State level that will maybe help guide the way for how we should be going nationally?
Mr. PETERSON. I will give you a couple of ideas. I think that what Mr. Cox is talking about, one thing we have always advocated, I think there are people who will do things just from technical assistance. So wherever you can provide technical assistance a large number of landowners will do that. That should be one option that is open probably more broadly, and it does not have to be tied to signing up for CRP or WRP or something, technical assistance to help people assess their operation. And some if they do that will do good things for conservation.
But I would say to the Congresswoman over here that not always are people able to afford to do it if they have technical assistance, because you have a lot of small landowners that may need some level of financial assistance. And that is where it would be extremely important to have some flexibility at the local level to give technical assistance to those who only need that and be able to go a step further to landowners who need more than that. That is one kind of flexibility.
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Another kind of flexibility, as I mentioned earlier, is to try to package these programs so that you do not at one point put in a CRP and 3 months later do WRP and some time later do something else so that the farmer will know the outcome at one point in time. Those are just a couple of ideas. And I think if you gave the State and local people more flexibility, they would come up with more ideas of how you might do this.
Mr. GROSSI. Congressman, I could add a few points. I think one of the problems with our current programs is that the priorities are set here instead of in the States and localities. If we had a system in the best of all worlds where the State knew how much money they were going to have in the form of Federal matching funds for a particular year, and had fairly broad guidelines as to how to apply those funds based on the priorities in that State; that is, water quality versus climate or some other issue, habitat, and allow them to make those decisions and draw those guidelines, if you will, to allocate the funds and to decide how much matching funds they could apply to the programs, we would have a much more effective system.
We would generate a lot more interest and probably a lot more matching funds at the State level and we would build a constituency for these Federal programs that currently does not exist among American consumers and taxpayers.
I would point to one program with which I am very familiar, of course, as an example: The Farmland Protection Program allows States, local communities, and nonprofit organizations to match Federal dollars, and it matches them rather dramatically. Unfortunately, it has been a small program but we are getting a 6-, 7- and 8-to–1 match from non-Federal sources. That is the kind of efficiency and leverage I think we could get in other programs if they were designed properly.
Mr. COX. Congressman, we explored the idea of block grants, which was brought up in the previous panel, in our workshops. We ran into a buzz saw of opposition to the notion of block granting programs for a number of reasons, including accountability issues and concern that those programs would be redirected away from the purposes for which they are authorized by Congress.
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We think there is a couple of opportunities to pursue that are perhaps less dramatic than block grants. One would build on the experience with the Conservation Reserve Enhancement Program that I think you are familiar with in Minnesota. This notion of operating Federal programs through State agreements that provide States much more flexibility in how those programs operate I think is a good example. And I think we should explore how to expand that notion to all of our USDA conservation programs, building on the success of CREP, and of the Wildlife Habitat Incentives Program.
We also think there is an opportunity to provide States more money as well as more flexibility to implement their State agreements or State plans, by thinking about creating a fund by which a portion of all of the dollars made available every year for individual conservation assistance funds is pooled and made available to States who have signed these agreements. And somewhat like a grant program, I mean, we think this kind of idea would get around a lot of the objections that we heard to block grants and yet provide a significant amount of flexibility and authority at State and local levels to deal with Federal program guidelines.
Mr. KENNEDY. Good.
Mr. NELSON. I will just make a quick comment. ''One size fits all'' never works as good as many sizes tailored to each individual area would work. The example of the CRP cover EBI is a great example of what happens when you try to apply one formula to everywhere in the country. I would strongly advocate being mindful of flexibility at the State level, but maintaining important sideboards to maintain quality control in the program and some consistency across the country.
Mr. KENNEDY. We appreciate your comments and look forward to working with you on adding more flexibility in whatever we do here in conservation. So thank you.
Mr. THUNE [presiding]. Mr. Thompson.
Mr. THOMPSON. Thank you, Mr. Chairman. I have a question of questions, one I think I am particularly interested in. I am from California and our property values in California are, sometimes to the point where it is detrimental, are pretty high. And it seems to me that we need to figure out some way to craft the conservation programs so they will be able to respond to the sprawl matters and such in California that will allow us to participate in the programs. We have lost, I think, 97 percent of our historic wetlands, for instance. So I would think it would be an idea that is critical that we are able to respond. But given the high property values, it is tough for us to participate in these programs.
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I was wondering if any of you had any ideas as to how we could address that issue?
Mr. GROSSI. Well, as the Californian sitting at the table I will take the first shot at it, Congressman. While I am at it, I want to welcome a fellow Californian sitting behind me, former Deputy Secretary Rominger, who has joined us today, who might know a lot more about this than any of us.
As you know, the current method of distributing dollars across the American landscape, Federal dollars for farm programs, is not based on any real evaluation of the resource base. It is historic based on primarily commodity production, and that in itself ought to raise a big red flag for all of us. California is by far the number one agricultural State. It has tremendous natural resources that are at great risk, and there is very little money going into that State to address the problems.
So redefining the parameters, the different distribution system, maybe allocating new dollars; you heard me suggest that we ought to raise the total to somewhere around $11 billion. Maybe it is not the current level dollars that you reorient, but put the new dollars into those places where the most important resources is at the greatest risk and allocate it by some criteria that defines that other than what kind of commodity you produce.
I think it is very clear that in California a little money will go a long way, even though the property values are high, because the public has put protection of the land as a very high priority. And so the State and private interests and foundations are contributing a great deal of money. And, frankly, the Federal Government is not living up to its share of the costs of protecting the environment out there. I am suggesting a different kind of criteria that would make sure the money goes into the place where the best, most important asset is at the greatest risk.
Mr. PETERSON. Congressman Thompson, having lived in California for 15 years, but I sold my property before all the values went up. I have good timing. But realistically, I think as Ralph Grossi has indicated, there are some important partnership programs that have worked pretty well in California. The State of California Fish and Game Agency, for example, has put quite a bit of money into protection of wetlands. Ducks Unlimited put quite a bit of money into it. So I think if we look at partnership programs in places like that where values are high, the benefits are also high. So we ought to figure out ways to leverage those partnership programs as one idea.
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Plus, maybe that Environmental Benefits Index that we all cuss and discuss, maybe we could recognize the size of the benefits from some of these programs other than just the benefit index.
Mr. THOMPSON. Thank you. I look forward to working with any of you and the subcommittee to make sure that we can address this issue.
Another matter that concerns me—and it came to my attention because of a California project, but I am assuming it has happened in other places—we have a highway in my State that they want to realign, and they want to realign it, the Department of Transportation, right through the middle of permanent easements for wetland protection. And they are going to take it through both State level easements as well as CRP and WRP easements.
I think this greatly undermines the integrity of the program. If someone puts their property into permanent easement and taxpayers pay for that, it seems deleterious to me to then run a highway through that. And I would like to figure out some way that we can provide a higher protection for these properties that we are trying to protect. And if you have any suggestions on that, I would like to hear from you. You can let me know separately because my time is running out.
I would like to get a sense from the four panelists as to your ideas as to permanent easements vis-a-vis temporary easements. It seems to me the permanent easements provides a good planning tool for both resource allotment as well as for farmers who participate in these programs.
Mr. PETERSON. Let me talk about the highway thing there for a minute. There is a provision in the Federal law that says if you are building a highway, you can't use either recreation land and so on unless there is no feasible alternative. That is maybe a little too strong for the case that you are using, but there is a precedent in the law that says you can't just disregard the fact that there is an easement.
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I would also point out that groups that oppose permanent easements also say that sometimes a little thin easement might hold up something that is badly needed. So somebody ought to be able to weigh those equities. And we believe that the fact that there is a permanent easement ought to be an important thing when you locate that highway, to not just ignore that is there. And there is precedent in the Federal Highway Act now for outdoor recreation and park land, but does not address permanent easements.
Mr. NELSON. I will just say one quick thing about permanent easements. I think permanent easements are a critical part of the mix. I think there are critical parts of the landscape that ought to be put under easement to protect the resource values that are there. On the other hand, there is always the need for shorter term conservation programs that maybe transition landowners to different kinds of working agricultural properties.
Mr. GROSSI. Congressman, let me just add two quick comments to that. The reference to the highway, there is a Farmland Protection Policy Act passed in 1981, rules are out and the Governor of the State has considerable power if the highway is going to go through productive prime farmland. So that is one avenue in that case.
On the issue of permanent versus term easements, I think the reality is that you will find that you will pay almost as much for a 30-year easement or 25-year easement as you would for a permanent easement. In that case what are we really getting for the taxpayer in return? Are we getting permanent protection for the money put out or only buying time?
Mr. THUNE. Mr. Putnam.
Mr. PUTNAM. Thank you, Mr. Chairman. I wanted to speak with you about some of the ideas that the Farmland Trust and Mr. Cox had raised. Mr. Cox, if I read your booklet correctly, your organization recommends essentially a fundamental shift from a production or income support-driven farm policy to a stewardship or conservation-based farm policy, where you would—if I understand it correctly—form the basis of all payments on the social benefits derived from that farmland, the water recharge, wildlife habitat, et cetera. Is that essentially correct?
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Mr. COX. Actually, that fundamental reform was suggested by a number of our workshop participants, but we came out nowhere near down as fundamental reform of that.
What we are actually recommending is the creation of an option based on stewardship. We see some elements of especially risk management components of current farm policy continuing, because conservation simply cannot address some of those risks. Crop insurance, for example, if reformed and made to function as a true insurance program, should continue because conservation is not going to deal with the risks of hail or bad weather or disasters. Similarly, perhaps something that looks like a safety net, a minimum countercyclical sort of program that deals with legitimate risks faced by producers in world markets with swings in prices may have a function long term within agricultural policy to deal with those real risks that agricultural producers face.
So we are not arguing that conservation can replace all elements, all of the traditional tools of farm policy. But we do think there is a crying need to balance our over-reliance on those traditional tools now with new tools that provides new options for farmers and new options for policymakers.
Mr. PUTNAM. The State of Florida has just passed a Rural Lands Protection Act which outlines just those stewardship payments, and I have legislation being prepared to be filed that would do that as well, and that is why I am very interested in the idea of stewardship payments.
Does the Farmland Trust have——
Mr. GROSSI. If I could just add a comment to Craig's comments. I think we need to back up and think about what the underlying principles are here. What is the policy or the principle that guides the policies that you are developing? And we think that ultimately we should get to a point where the payments to the landowners are consistent with the goods that landowner produces for society. Those goods in some cases might be environmental, social goods, if you will. In other cases they might be the protection of highly productive farmland or the production of certain commodities, food and fiber.
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But right now they are all skewed. All the payments are skewed toward those producers who produce food and fiber. And there are these other values that flow from private lands that are produced. They are products of farms. Wildlife habitat, clean water, open space are farm products and we ought to begin to shift to align what the American taxpayer is paying with what the American taxpayer is getting in return. And that would lead us to a system that was not only fairer, but had much broader public support across the country, I think.
Mr. PUTNAM. What type of a time limit would you put on such a commitment? Would it be a 5-year stewardship agreement with the landowner? 30-year? An annual? Was any thought given to that by any of your organizations or discussion?
Mr. GROSSI. I don't think there has been a lot of detailed discussion, but there are plenty of models to draw from. One of them is in my home State, the Williamson Act program in California, where a rancher can sign up a 20-year agreement with their county to get the maximum use value tax benefits. And you are in the program for 20 years all the time until you opt out, and then you have 19 years left of benefit until you no longer get the benefit.
So that is the kind of model one could look at. There are other models and we would be happy to work with your staff on exploring some of those models.
Mr. PUTNAM. I look forward to that. Thank you. Thank you, Mr. Chairman.
Mr. LUCAS [presiding]. Mr. Peterson.
Mr. PETERSON of Minnesota. Thank you, Mr. Cox. In your testimony, in your explanation I guess, you were explaining the Conservation Security Act, something along that concept where you talked about the stewardship contracts.
Mr. COX. Yes.
Mr. PETERSON of Minnesota. Who decides what the appropriate stewardship is and how these payments are going to be made? That is what concerns me. In Minnesota we have got the technical committee that was set up that is primarily dominated by Twin City people, which is something we run into all the time. And we have problems because they do not understand what is going on up in northwestern Minnesota. That is part of the problem.
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So some of the concern I have about this is who it is that is going to decide what is the appropriate thing to do and are they going to come up with some cockamamie idea of about what it ought to be that is going to drive us crazy again, to be blunt about it.
Mr. COX. Congressman, we would certainly not recommend that we use a cockamamie scheme that would drive you crazy. We have been asked this question a lot in the course of our workshops and our deliberations since then. I must say I find it a bit puzzling in the sense that this issue has had to be dealt with in every financial assistance program for land management since the 1930's. And it was dealt with under the Agriculture and Conservation Program. It has been dealt with under EQIP. Can every financial assistance program——
Mr. PETERSON of Minnesota. Let me stop you there. That is one of the problems that I have with it. We have created all of these things. Now if we set up a new program, we are going to go back and create a whole other process and have everybody come in and have to redo this all again.
Mr. COX. I think there are two things there, if I could finish my first thought. There is a lot of experience with very credible ways of applying local priorities and professional judgment to come up with a rational way to set payments for conservation performance. I think what would be different is the scale. It is not a difference in kind, it is a difference in scale. And that difference in scale troubles us, because if we really went down this stewardship option route we would be looking at providing technical assistance on an ongoing basis in the countryside at a scale we have not done since the 1930's. So that is an issue.
On the other issue, sir, we say in our report that unless this stewardship option is very big, $3 billion at a minimum, if we are not willing to make that kind of commitment within farm policy to stewardship, then we shouldn't do it. It would be much better to invest smaller sums of money if that is all this committee can address to this priority, to invest that in existing conservation programs. In fact we would recommend consolidating conservation programs to address that issue.
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Mr. PETERSON of Minnesota. Thank you. If I could, I would just like to make a little bit of a comment here about CRP. It gets to kind of what I am talking about here and it is some of what has been discussed in the committee all day. I represent this area of the Red River Valley where the river flows north and it floods all the time. And we have got the DNR and the technical committee, again these people in the Twin City, and the solution that they give us is that we should have more wetlands. And I am all for wetlands, but they do not understand what is going on up there. We had bigger floods in the 1890's and 1880's than we have now and we had all the wetlands still in place. There wasn't one wetland drained at that point. These last three floods the wetlands have been completely full. They do no good. The water comes across land and we are paying millions of dollars to replace land.
Now, so the CRP does not qualify in the Red River Valley because it is not marginal land, it does not fit the EBI index, and we cannot get any CRP. I grew up in this area. I used to hunt there. There is not one bit of wildlife habitat left in that area. So we have been trying to get CRP put back in there, because that would actually stop the water and stop a lot of this overland flooding and it would work. We can't get it done.
The people in the Twin Cities, they are against it because they want us to put in wetlands. And this is the kind of frustration that we run into. And I think it happens in other parts of the country as well where we can see if we could just make a sensible use of these programs, that we could take that area alongside the river that floods and put into CRP, if we could put in strips to stop the water from coming across, we could stop a lot of this problem. But we can't do it.
And not only will they not look at it, they are opposed to it on ideological grounds because they have some idea of about what is politically correct or whatever.
So, I don't know what my point is other than to say that we have got some problems in trying to figure out how to make all of this stuff work and I hope during this process we can sit down and work on sensible solutions to make these programs which have been good programs work better and accomplish things for the people.
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So thank you, Mr. Chairman.
Mr. LUCAS. Thank you, Mr. Peterson. Mr. Osborne.
Mr. OSBORNE. Thank you, Mr. Chairman. Thank you, panelists, for being here today.
I certainly agree with a lot of your arguments. We currently have an increase in TMDLs and the requirements of the Clean Air Clean Water Act and Endangered Species, and of course this is adding cost to the landowners. And my contention is that we are not adequately compensating them for what we are expecting them to do.
So I am interested in some of your ideas. Seems like Mr. Cox has kind of been the whipping boy today. I will start in with you on the stewardship contracts. You were talking $3 billion, or exactly what percentage of the total agriculture budget are you talking about for these contracts?
Mr. COX. The way we finished our deliberations was to settle on a $3 billion level as the minimum level that would really make such a stewardship option a truly viable option for agricultural producers. And it was very important to us that this option be a real option for producers that provides assurances comparable to other aspects of farm policy. And we thought $3 billion was about the minimum that could be invested in such a program and accomplish that objective. That would be, depending on which figure you want to use—if $28 billion in fiscal year 2000 was spending on farm subsidies, that would be a relatively small percentage of that total.
Mr. OSBORNE. I believe, Mr. Grossi, you were talking about one-half of $22 billion, and actually probably have something like $17 billion on the average over the next 10 years in the budget right now, so it is not going to be that much. But I guess, particularly to you and maybe to Mr. Cox, I would ask this question: There is considerable difference in land types. You may get some land in Iowa that is very uniform, maybe no rivers, no bodies of water, which would not require any buffer strips. And then you may go to some other areas such as South Dakota where you will have a variety of landscapes, and Nebraska. So you will have some landowners qualifying for a relatively large percentage of these types of payments as opposed to others. And have you thought at all about any inequities or do you feel that my assumption is incorrect that there will be considerable differences?
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Mr. GROSSI. Of course, Congressman, there would be differences in how the money would flow. In the situation where you quadruple the amount of money for conservation as we are suggesting—and incidentally in my testimony when I referred to $22 billion, I was referring to the 5-year period of the farm bill. So it is supposed to phase down as was the case in the last farm bill.
I want to come back to the principle that I talked about earlier, and that is are we asking the tough questions? What is the taxpayer getting in return for their dollars and how do we justify these kinds of payments out into the future when we can't rely on emergency status to shovel money out the door at USDA?
And if we ask these tough questions and if we apply the programs so that farmers can make a decision about what they want to produce, how much land they want to set aside, how much land needs to go into buffer strips and that payment to them is competitive to producing a commodity so that the taxpayer is paying for something they are really getting in return, that virtually all farm areas have something to offer the public in the way of social benefits. In the way of soil conservation, wildlife habitat, clean water, carbon sequestration—one of the promising areas—virtually every farm area has some of those benefits, and what we need to do is create the options for farmers and local communities and State agencies to select from and then get the money flowing to those farmers who can best produce those benefits.
Mr. OSBORNE. You mentioned the words ''carbon sequestration.'' one of the questions I have been asked, if somebody is a rancher, they have had the same land for 100 years and they have taken good care of their land. And then you have someone who is farming marginal land and they take that land and put it back into grass. There is a temptation to say that we are going to reward that guy who takes the marginal land out of production and puts it back into grass and we are not going to do anything for the guy who has done something for 100 years. Have you thought about how you are going to allocate, or what carbon sequestration really means and who is going to dispense the funds?
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Mr. COX. Congressman, there is both a moral and a technical issue embedded in that question. I will take up the moral issue first, that since existing conservation programs often reward those folks that have either done the wrong thing or delayed in doing the right thing was one of the fundamental reasons why our workshop participants wanted to see a stewardship option built into farm policy itself.
We heard a number of examples from farmers who told us that they had kept their fragile land in grass and pasture and rangeland for generations and are therefore ineligible for assistance under the Conservation Reserve Program, whereas their neighbor who broke out their land was now getting $40 an acre a year to put that land back into grass. Those sorts of inequities were very strongly felt, particularly among the producers in our workshops.
This has been an issue with conservation programs for decades. I think we desperately need to find a way to deal with that. There are ways to deal with it in both existing conservation programs and in the Stewardship Program. We tended to think of things as maintenance fees versus installation fees where there is a cost to maintenance of practices and of good conservation systems. In many cases we know what those costs are today. And I think if we thought about stewardship both in existing programs and in this new stewardship option as maintenance versus installation, we could come up with a payment scheme that would not just reward those people who are doing the right thing now, but also pay less money perhaps, and almost certainly less money for maintenance, but still provide a reward to those folks who have been doing the right thing sometimes for generations.
So I think there are ways to address that. The carbon sequestration front, that is a technical issue as well as a moral issue in terms of accounting for the effective practices over decades, which is a daunting technical task. Most people that have confronted us with that technical problem have tried to look at what is going to happen from this date forward. That is an easier technical question than to ask us to quantify what happened in the past 30 years. That may be a way to look at the sequestration issue.
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Mr. LUCAS. Mr. Thune.
Mr. THUNE. Thank you, Mr. Chairman. Thank you, panel. Let me just begin by saying that I am very supportive of many of the programs that are already in existence. In fact, I am a cosponsor of Congressman Peterson's bill to expand the CRP program. That is a program that has been enormously beneficial to my State of South Dakota. I think he wants to expand it so they can get acreage in Minnesota so they will have a pheasant population over there, so he doesn't have to come to South Dakota to hunt pheasants. I am not sure we want to accommodate that request.
As you know, I am sponsoring the Conservation Security Act, which you talked about the stewardship contracts, very similar to what we are talking about doing, and I think it is a very sound concept for a lot of reasons obviously. And the Chairman obviously accuses me of promoting my bill in these hearings. But I do have a question that I would like to get your answer to. One of the things that concerns me about some of the existing programs that we have is obviously the small businesses in South Dakota are very dependent on—the seed dealers, the fertilizer, all the folks on Main Street who serve the production agricultural population in our State suffer when we take a lot of land out of production.
I think we also know that we are going to spend a substantial amount of money in this new farm bill supporting agriculture. It seems to me it makes a lot of sense, and there are public benefits that are derived when we compensate landowners for practices that they are employing that are leading to conservation and wildlife habitat and all those things. Do you think that it is necessary to idle land in order to get a conservation benefit? If we allow producers to continue to farm, which is something they say, too, we sacrifice income sometimes if we pull land out of production, there are a lot of benefits in my mind that if we continue to allow them to farm the ground and implement conservation practices that are in the form of these contracts that they would agree to and then be compensated for those practices.
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And then a follow-up question to that, perhaps Mr. Nelson, about the wildlife benefits of one program relative to the other, because I know that is a concern that you have. It is a concern that I have. I would like to think that we could figure out a way to accomplish all of these objectives and provide broad public benefits at the same time that we are supporting our producers.
Mr. NELSON. Let me just quickly address the issue of working lands. One of the reasons we are strongly supportive of the Grassland Reserve Program is because there are ranchers that have incredibly important native grasslands and they use and will continue to work and it offers them an option to get involved and get paid for the conservation that they have been providing all of these years. It has been a very popular program as delivered through the Fish and Wildlife Service in South Dakota, as you probably know.
We are finding at least as much interest in North Dakota, where the laws are different, but we are working with the Fish and Wildlife Service to help make that option available to producers. We think it would be very popular if it was delivered through USDA in some kind of a parallel program and that would entail working lands, the implication being, yes, working lands do provide many values for wildlife. There is nothing wrong with grazing grasslands. I think grasslands, if they are going to stay grasslands, need to be grazed.
We obviously try to work with producers and make sure that they are not overgrazed, but our focus is to get the marginal land that is out there that has been broken out back into grassland cover and then get the wetlands restored, because they are a value as well when they go to a grazing system.
I also wanted to quickly touch on the idea that CRP is not really working land that has been idled. I think nowhere has the benefit of CRP been more evident than in South Dakota to the landowners. And most landowners who have CRP want to keep it idle because they get such tremendous wildlife production out of it, particularly pheasants. And we are seeing many operations really revolving around that idle cover that is part of the nesting cover and wildlife habitat that was missing in the system.
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In fact, we have some small programs we have started in South Dakota where we seek to restore property that is on the market that is marginal land that has been broken out and we are having a hard time paying simply appraised value on an agricultural basis because so many farmers want to get back into—give that land because of the demand for pheasant hunting. I think there are ways of using working lands that produce both wildlife and agriculture products.
Mr. THUNE. Anybody else care to comment if it is necessary to idle land to get the conservation benefit?
Mr. PETERSON. I would agree with Mr. Nelson's comments. We worked very much with landowners where it is possible both to use the land for grazing and other purposes and still produce wildlife. But in an area where the native wildlife needed cover of the type that is provided on certain lands, and many of those were marginal lands originally that probably never should have been broken to begin with. If you went back and tried to break them out and work with the farmer, it simply wouldn't work in many of those areas.
There are other areas where, as Mr. Nelson indicated, where you can allow some grazing and that is why we are interested in this grassland provision, where some grazing is very compatible depending on the time of year and so on, with the production of the land for water quality and wildlife. So you can get all the benefits plus some use, and we would be very interested in working with you on that.
Mr. GROSSI. If I could add a comment, I am bothered by the implication that retiring land has a negative impact on the rural economy, if you will, the constant theme we hear criticism of CRP, because the flip side to that logic is that we support crop subsidies to enhance rural economies, crop subsidies that have clearly had a negative impact on the resource base in terms of soil erosion over the years.
I would suggest that might be analogous to tearing down a building and rebuilding it in order to rebuild economic activity. We have to rethink the logic behind it. If the objective is to support family farms, a sustainable family farm system in our rural economies, then funneling money through commodity programs probably is not the best way to do that. But if there is a social benefit to preserving that family farm structure out there, then let's find another way to do it. If it is not through stewardship payments, then some other system. But funneling the money through commodity programs that leads to negative impacts on the resource base and having to retire to rebuild it is twisted logic, but that is the state we find ourselves in.
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Mr. THUNE. And to respond to that, Mr. Chairman, I think the point that I was making in that is if there is a way to accomplish both, because your point earlier about what the taxpayers are getting for how we support agriculture, if we can get environmental benefit, conservation, wildlife habitat, all of those things, and at the same time the farmer continues to buy seed and fertilizer on those Main Streets, I think it is time for a new model, and that is why I hope this new bill provides the basis for doing that.
Mr. LUCAS. Thank you, Mr. Thune. I think it is worth noting several times in the discussion today the discussion has come up: What does the American taxpayer get for his or her dollars in our present agriculture policy? We clearly need to remember that the first and foremost requirement of this coming farm bill and all previous farm bills is to provide the highest quality food and fiber to the American consumer, to make sure that we are all given the opportunity to eat and to be dressed.
And the secondary role, for two centuries this country has acted as the world's granary. We have been the productive workhorse that has made sure that resources in times of drought and famine and war were available for a price for the entire planet. That has been the ultimate original goal, I think, of farm policy and responsibility of production agriculture.
That said, times change and increases in productivity have changed rural America. When that first farm bill was passed in 1933, both of my grandfathers farmed behind two mules. My implement dealers now tell me if the tractor does not have 450 horsepower they cannot sell it. So things do change, but we have to reflect that.
Now this panel and previous panels and many of my constituents back home have advocated substantial increases in conservation spending, most of it with a tremendous amount of merit. But as a subcommittee, and as a full committee, we have to work within the resources that are made available to us to achieve the greatest possible goal.
Let me ask one last round of questions. If we are successful in coming up with substantial resources to invest, clearly NRCS has said before this subcommittee that they with their present personnel base are doing, I believe 110 percent was the comment made in the hearing, and I believe that. Much discussion has been made of third party sources for technical advice and implementation of these programs if the resources were available. Tell me from the perspective of your organization, would you be involved in that role if they were available? Would you be out there contracting with the Federal Government to provide this kind of assistance? Anyone or everyone.
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Mr. NELSON. We already are in a big time way, particularly with WRP. That is the only way that I know it is getting delivered in the States of Arkansas, Louisiana and probably others. We could find out for you. We in the northern part of the Great Plains, where I work, we have staff in several NRCS offices helping to deliver CRP, wetlands restoration in CRP, helping deliver WRP in Minnesota. So it is going on because of that backlog of work and they found it cost-effective to involve partners like Ducks Unlimited and other partners, State associations and so on. So it is happening already.
It seems to work fairly well. It is a good partnership. And it has been one that has been evolving over the last several years, getting comfortable with each other and what we each can bring to the party, but it is working well.
Mr. LUCAS. Mr. Cox? Mr. Peterson? Mr. Grossi?
Mr. COX. In that order, sir?
Mr. LUCAS. Whatever order you choose to go in.
Mr. COX. A small but I think growing number of our 9,000 members of our professional society are engaged in that kind of activity at the moment, mostly with landowners themselves, as private crop consultants or conservation consultants. But increasingly I am hearing from members that are involved in companies that are getting Federal grants of one shape, form or another to undertake conservation services for Federal programs. So it is happening, but it is certainly not the dominant employment scheme for our members.
Mr. PETERSON. Let me emphasize again that we surveyed 14 States and found out in those 14 States that they are providing over $5.4 million in cost sharing and 300,000 hours, the equivalent of 145 full-time employees, to help deliver farm programs. That is about 10 people per State, so the States are involved now.
But let me add real quickly that we have said for years, NRCS does not have enough technical people to fulfill the role that they need to fulfill, even if we assist and others assist. So I think that is a major problem to get enough people in NRCS to provide it because if they are not out there with the service available, particularly small operators will not take advantage of these programs unless there are people out there that are an outreach type of thing. So the needs are there, in addition to what we are already doing and we will continue to do.
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Mr. GROSSI. Just very quickly, Mr. Chairman. I think first and foremost we need to repeat and echo what others have said about the need for technical assistance in NRCS. They are the trusted delivery service of technical assistance to the farm and ranch service. We need to enhance that capacity. Yes, my organization, the American Farmland Trust, is working with NRCS to help implement the Farmland Protection Program, both through training and education activities and actually helping with the land transactions in certain parts of the country. But we also have an extended family of land trusts and local agencies that are doing a great deal of work and would do a lot more if the funds were available to acquire easements or to cover some of the costs of doing so.
Finally, I want to emphasize the potential to leverage existing resources out there. State agencies, local governments, conservation districts, many of these agencies have unlimited potential to work with the Federal Government if the programs are designed properly.
Mr. LUCAS. Thank you. Any other questions from the committee?
Mrs. CLAYTON. Yes, I do have.
Mr. LUCAS. Mrs. Clayton.
Mrs. CLAYTON. This subcommittee has as part of its title ''Rural Development.'' and just listening to the proposals and the opportunities that we have coming from several of you, Mr. Cox, Mr. Grossi, the American Trust, it sounds as if there is an opportunity to look at conservation in a broader sense. Not necessarily separating it, but to see its value beyond our traditional way of production of commodities or food fibers.
I have been saying that as agriculture goes in most rural communities, so does the rural community, meaning they are intertwined and interrelated in terms of their survivability. The department store or the hardware store or the bank indeed suffers as the farm suffers, but we also lose an opportunity in our farm communities in terms of an economic growth component if it is shrinking in terms of that.
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If you look at the economics, the demographics of the last census, you see people moving away from the land. There is not enough opportunity within rural communities to keep them there. So there is compelling reason for us to shore up the economic survivability and the productivity of our farmers; also with the livability and the economic opportunities in our community.
This committee has the opportunity for rural development, and heretofore it has been two or three paragraphs in the farm bill. I would just ask any and all just to comment, do we have an opportunity to look at making a statement about rural development in its more holistic sense than we have in the past? And anyone can answer.
Mr. GROSSI. I will jump in first and then pass this down the line, but I think the kinds of programs that are being suggested here are in effect a more sustainable potential rural development than are the current farm program payment system. Farmers would truly be paid for something of value they are producing.
So the comment made about broadening the programs here is relevant. We are not suggesting you do away with entirely the current commodity programs. We are talking about adding another set of products that we can reward farmers for producing and that is social products, environmental products that they produce. And currently they have to give away instead of collect something for it. So the opportunity is great.
Just in terms of opportunity, I think the chairman said it very well a few minutes ago, that times do change, and the reality is that the farmers who produce the food that America eats do not generally get any support from the Federal Government. It is only a few commodities that get that.
I was before this committee 16 years ago and Chairman Jones chaired this committee, and that committee at that time took the bull by the horns and made a dramatic shift in conservation programs in 1985. I think you have the same opportunity today, Chairman Lucas.
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Mr. COX. I would like to respond and take it from a little different angle than Ralph did. One of the implications of the productivity revolution that Chairman Lucas just mentioned—and that productivity revolution is really at the heart of all of the angst, I think, regarding farm policy that this committee and everyone that is desperately concerned about agriculture faces. But one of the other consequences of that is that in many areas agriculture no longer plays the role in rural economies that it once did, and in fact a significant number of farmers and farm families and farm operations rely on off-farm sources of income in order to make their households viable.
So I think rural development is another potentially wonderful way to balance farm policy. I mean we started out talking about the imbalance in farm policy and talked about conservation as another leg to the stool, so to speak. But rural development, off-farm developing rural communities so that there are greater economic opportunities off the farm, is probably a critical way to also support a lot of those farm households that are increasingly dependent on a job in town to maintain their farm operation.
So I think it goes both ways, Congresswoman. I think conservation can be a force for rural development, but I think rural development can be a real force for sustaining farm families as well.
Mr. PETERSON. Let me just add I grew up in a real small town in Missouri. That town has changed quite dramatically since then. It is being undergirded by a much more diverse kind of economy than it was in my time. It was all production agriculture at that time. There is still some production agriculture, but now it is alongside of a river that has tremendous recreation opportunities. It is a famous hunting and fishing area and a place for people to visit. A lot of people are moving back to that area as they retire and people can live there and through the Internet can have jobs that they used to not have. .
I think we need to look at rural development within a broader context, which is what is being said here. It is certainly going to involve conservation and production agriculture, but probably a different mix than it had once before, and that is one of your challenges, I think, to see what that mix might be.
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Mr. NELSON. Just one quick example. Even in a State like North Dakota, tourism has almost caught agriculture in terms of the percent of gross domestic product in that State. And it floored me when I saw that statistic, but it is growing at 35 percent a year. Things like Lewis and Clark have helped. But certainly what we are looking at is finding ways of working with the State to diversify the source of income and the economy, because if we do not the State will go nowhere and we will continue our population drain.
And I am afraid that is the same pattern we are seeing through the middle of the country, where commodities are typically produced. So we are trying our best to take a fresh look at the landscape not as simply a place to grow food and fiber, which it will always be about, but to see it as a place that has great natural amenities and can have a great attractiveness to people who come for other reasons, either tourists or hopefully to live there ultimately. And with the new economy coming on, finding those kind of places, a quality of place that that is where they want to live and work, not because they are farmers but because of the way the landscape is and looks.
Mrs. CLAYTON. Thank you.
Mr. LUCAS. The subcommittee thanks the panel for your insights and continued input as we work through this, and we have great expectation that whatever we come up with you will help us work with the appropriators on.
Without objection, the record of today's hearing will remain open for 10 days to receive additional material and supplemental written responses from witnesses to any question posed by a member of the panel. This hearing of the Subcommittee on Conservation, Credit, Rural Development, and Research is adjourned.
[Whereupon, at 3:55 p.m., the subcommittee was adjourned, subject to the call of the Chair.]
[Material submitted for inclusion in the record follows:]
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Statement of Craig Cox
Mr. Chairman, members of the committee, I want to thank you for the opportunity to appear before you today representing the Soil and Water Conservation Society (SWCS). My name is Craig Cox; I serve as Executive Vice President of the Soil and Water Conservation Society.
SWCS is an international, not-for-profit professional society, founded in 1943. Its mission is to foster the science and art of natural resource conservation. Our 10,000 members include professionals ranging from technicians who work one-on-one with landowners to researchers who seek to improve our basic understanding of conservation problems and solutions. Our members provide the scientific and technical foundation for implementing the conservation programs that are the subject of today's hearing. Agricultural policy and the farm bill, therefore, are critically important to our members.
Last spring, SWCS initiated a two-year project, Seeking Common Ground for Conservation, to help shape the conservation provisions of the 2002 farm bill. We invited state and local leaders with first-hand experience of the strengths and weaknesses of current agricultural conservation policy and programs to a series of five regional workshops. Participants representing the agricultural, water resources, and fish and wildlife communities mapped out a continuum of reforms to conservation and farm policy. SWCS took that map and developed specific recommendations that, in our best professional judgment, hold the most promise for addressing the hopes and concerns of the workshop participants.
Those recommendations are detailed in our new report, just released this morning, entitled —Seeking Common Ground for Conservation—A Farm Bill Proposal: Responding to the Grassroots.— We are pleased to provide members and staff with copies of the report this afternoon. Additional copies can be obtained by contacting us at pubs@swcs.org or from our website at www.swcs.org/t—seeking—intro.htm.
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In brief, workshop participants told us that the next farm bill must be about more than the price of corn—or wheat, or cotton, or rice, or any other agricultural commodity. It must be about caring for the land and keeping the people who work the land on the land. Participants were increasingly skeptical traditional commodity-based subsidies to achieve these goals.
Policymakers face fundamental choices as they begin reauthorizing the farm bill. Those choices go to the heart of what should be expected from conservation and farm policy. They should force an answer to two questions: (1) What do we want from conservation, and (2) what do we want from agriculture?
At a minimum, conservation policy and programs need to be strengthened so they can continue their traditional service to agriculture—but updated to address the environmental challenges that now confront farmers and ranchers. That will require a doubling of the current investment in U.S. Department of Agriculture (USDA) conservation technical services and financial assistance programs. New investment should ensure that all three compartments in the conservation tool box—technical services, financial assistance for conservation on working land, and financial assistance for land retirement and restoration—are well stocked with effective tools that work for agriculture and the environment. The first priority for new investment should be a doubling of funding for technical services and a tripling of funding for conservation on working land.
New funding should be accompanied by a series of minor and major reforms of existing programs and policy. The most important of those reforms are reaffirming the central place of technical services in the conservation endeavor, providing real authority and flexibility to states to tailor Federal programs to their unique circumstances, and simplifying the process of participating in Federal conservation programs by basing that participation on producers' conservation plans rather than on the administrative requirements of individual conservation programs.
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But settling for the minimum would be a mistake at this juncture. Instead, reforms to conservation policy and programs should be coupled with a new vision for farm policy itself. Traditional farm subsidies should be balanced with a new option based on land stewardship.
Congress should authorize a minimum of $3 billion dollars annually—in addition to the $5 billion recommended to expand the reach of existing conservation programs—for a stewardship-based farm and ranch program that rewards producers for using their land, labor, and capital to enhance the environment. This new farm and ranch program should reward good actors through technical services and maintenance fees to keep existing conservation systems and habitat in place on their operations. It should also pay farmers and ranchers more who want to do more by installing new conservation systems. USDA state technical committees, local communities, and producers themselves should play a key role in seeing that the new vision stewardship program achieves key conservation objectives by determining which conservation systems and opportunities would make the greatest contribution to environmental enhancement at state and local levels.
In combination, these two reform agendas would create an agricultural policy that is truly open to all of agriculture and built on a solid foundation—the unique status and responsibility of farmers and ranchers as the caretakers of this nation's land, water, and wildlife. Our new report makes a series of recommendations for action to implement both reform agendas. I would like to highlight a few of those recommendations and the reasoning that led to their formulation for your consideration.
REFORMING CONSERVATION POLICY AND PROGRAMS
Conservation entered farm policy in the 1930's during a time of crisis—economic and ecologic. The role of conservation then was largely to serve agriculture by developing and managing soil and water resources as a means of enhancing agricultural production and rural development. Now, however, the challenge for agriculture and conservationists has changed. Environmental performance is becoming a key determinant of the commercial viability of agriculture. Producers operating animal feeding operations or irrigating cropland or pasture already are facing fundamental questions about the environmental sustainability of their operations.
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Agriculture cannot escape the consequences of its environmental effects anymore than agriculture could escape the effects of land degradation in the 1930's. That is not because agriculture is bad, but because agriculture is big. More than half of the land area in the 48 contiguous states is agricultural land—cropland and grazing land. Almost 90 percent of all precipitation that falls in the continental United States falls on privately owned agricultural or forestland before it runs into streams, lakes, or underground water. About 70 percent of wildlife species depend upon private land for their habitat. The pressing question is whether we will organize ourselves to face this modern conservation challenge the same way we faced our historic challenge.
Existing conservation programs and policy can meet this new challenge just, as the challenge of the 1930's was met. But they must be updated and dramatically strengthened. At a minimum, legislative action in the next farm bill must strengthen USDA conservation policy and programs enough to ensure that commercial viability and environmental quality become compatible goals.
Funding. Funding for existing USDA conservation technical services and financial assistance programs should be doubled to about $5 billion annually—an increase, in percentage terms, comparable to what was accomplished in the 1985 farm bill. That investment produced dramatic reductions in soil erosion, protection of wetlands, and enhancement of fish and wildlife habitat. Since 1985, however, conservation funding has been flat in constant dollars. As a result, USDA conservation programs cannot meet producers' or the public's demands for conservation and environmental quality. USDA conservation programs remain dramatically oversubscribed. For example, the Wetlands Reserve Program (WRP) in 2000 recorded 3,171 offers on 567,000 acres that went unfunded. The unmet funding need, $524 million, was nearly four times the amount of money appropriated for the program that year. Likewise, only 30 percent of the 53,961 producers who applied for Environmental Quality Incentives Program (EQIP) funds in 2000 were awarded contracts. Funding needs were more than twice the $174 million available, and many producers reportedly did not apply for the program because of the limited number of contracts awarded in prior years.
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The farm bill must make a major new investment in conservation to meet the needs of agriculture and taxpayers in 2002. Policy and program reform alone simply cannot close the conservation gap and serve the long-term interests of producers and taxpayers. Doing more with less is not a viable option.
Balance among tools
There are three basic compartments in the conservation tool box: (1) technical services—research, education, and technical assistance; (2) financial assistance for conservation on working land—integrating conservation into the food and fiber production systems used by farmers and ranchers; and (3) financial assistance for land retirement and restoration—shifting the primary focus on working land from food and fiber production to habitat restoration or protection of critical natural resources. Today, the toolbox is unbalanced.
In 1985, 97 cents of every financial assistance dollar from USDA supported conservation on working land; 3 cents were spent on land retirement. In 2000, land retirement accounted for 85 cents of every financial assistance dollar from USDA, while 15 cents went for conservation on working land. Over the same period, the Federal investment in research, scientific and technical support, and direct technical assistance remained essentially flat, increasing less than 1 percent annually.
Most of the new investment in conservation should be used to strike a better balance among tools. Funding for technical services should be doubled to about $1.75 billion a year, and financial assistance for conservation on working land should be tripled to about $1 billion annually. The $5 billion conservation budget we recommend would thus strike a better balance and still leave room to increase funding for land retirement and restoration programs by about 30 percent.
Technical services. Weakness in this nation's technical services infrastructure is the single greatest impediment to meeting the conservation needs of landowners and the public's desire for environmental quality. Ultimately, farmers and ranchers do conservation; public programs do not. Timely, accurate, and appropriate advice and information from technically trained advisors in the public and/or private sectors is the key to successful conservation. Without it, financial aid is likely to be wasted or, worse, misdirected. In many cases, good technical advice alone is all that is needed to help producers implement conservation systems that promise economic as well as environmental returns.
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More money for technical services—as recommended above—is the first step toward solving this problem. But we also need to change the way we think about technical services. Since 1985 technical assistance has shrunk from 60 percent of the conservation budget to about 30 percent of the conservation budget. This growing emphasis on financial assistance reflects a conclusion among policymakers that the primary barrier to implementation of conservation systems on farms and ranches is cost. Many studies, however, show that lack of knowledge, rather than cost, is the primary barrier to adoption of conservation systems by farmers and ranchers. The next farm bill must recognize and affirm technical assistance as the most important conservation program in and of itself—not merely a cost of delivering conservation financial assistance to producers. Congress should ask the Secretary of Agriculture for an action plan and estimated funding needed to ensure that all producers have access to timely and effective technical assistance from the public and/or private sectors.
Flexibility. Conservation is a national interest, but like health care and education, it depends on local leadership. State and local leaders, whether they work in the private sector or in Federal, state, or local government agencies, need greater authority over the way USDA programs operate in their states. Some workshop participants recommended block granting new and existing funds for USDA conservation programs to states as a means of achieving this objective. Block grant proposals, however, raised serious concerns among many participants about accountability and potential redirection of funds from objectives that are extremely important to those programs' constituents.
Instead, we think the innovations in program implementation used in the Conservation Reserve Enhancement Program (CREP) and Wildlife Habitat Incentives Program (WHIP) should be expanded to touch all USDA conservation programs. States, at their choice, could develop a single, comprehensive state conservation plan that would propose changes in implementation of any or all Federal programs needed to meet state conservation objectives. Approved plans would provide much greater flexibility in program implementation and spark creative and innovative approaches to meshing local, state, Federal, and private programs and initiatives.
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States should be rewarded for undertaking such an endeavor, however, with more than flexibility and authority. They should also gain access to additional dollars. We envision a USDA-administered Conservation Partner Fund, created by using a portion of the funds appropriated each year for all USDA conservation financial assistance programs. Funds annually made available for conservation financial assistance programs—above a designated funding threshold for each program—would be pooled and made available, much like a grant program, to states that develop a comprehensive state conservation plan as outlined above.
Taken together, expanding the state plans and agreements pioneered in CREP and WHIP, with funding providing through a Conservation Partner Fund, could provide much of the flexibility proponents of block grants seek while maintaining the integrity and accountability of existing conservation programs.
Fairness. Ensuring that all producers in all regions have access to the Conservation Reserve Program (CRP) would be a major step forward in achieving greater fairness in conservation programming. CRP accounts for more than 80 percent of the nation's current conservation financial aid spending. But one-third of that funding goes to five states, all in the Great Plains, and only land with a cropping history is eligible for enrollment. Substantial progress has been made in opening the CRP to additional states with implementation of the continuous sign-up and CREP initiatives. More could and should be done, however, particularly in regard to the limitations imposed by the cropping history requirement, to enroll land in the CRP. That cropping history requirement limits the application of CRP on rangeland, pasture, and other land that could provide substantial environmental benefits. That requirement also puts at a disadvantage those good actors who have already installed conservation practices otherwise eligible for the continuous CRP sign-up.
Cropping history requirements for CRP should be modified to permit enrollment of environmentally sensitive acres of rangeland, pasture, or other land without a cropping history, at appropriate rental rates, and eliminated for all practices eligible for the continuous CRP sign-up. Congress should mandate at least a 5-million-acre goal for conservation buffers within the CRP and encourage participation through higher financial incentives and greater flexibility in practice requirements.
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Simplification. The multiplication of stand-alone conservation programs—each with its own unique value, but also its own unique planning, application, and eligibility requirements has created a confusing situation for landowners and for field staff. The notion of program consolidation, however, met with overwhelming opposition from workshop participants. Instead, we are recommending other, less dramatic steps to simplify the process of implementing programs for producers and field staff.
The first step we recommend is to make the producer developed conservation plan the basic entry point for multiple conservation financial assistance programs. Instead of producing multiple, often fragmentary plans to secure participation in a particular conservation financial assistance program, we would like to see producers work with technical advisors to develop a more comprehensive plan that integrates conservation into the farm and ranch operation in a way that meets a producer's economic and environmental objectives. That single producer driven plan should meet the planning requirements for all USDA conservation programs and open the door to eligibility under multiple financial assistance programs to implement the plan.
Second, we think simplification of EQIP is a particularly important objective given its importance as the only major source of financial assistance for conservation on working land. We think EQIP could be much improved by taking steps to move toward a continuous sign-up process and by reducing the upfront planning burden placed on producers and field staff. The single most important reform should be to eliminate the statutory bidding requirement that, as implemented, requires substantial upfront planning to apply for assistance. Instead, we recommend that a ranking process be used to estimate the projected environmental benefits from participation. Those producers already approved for participation, then, would only need more in-depth conservation planning. Producers and staff would have more certainty, and the environment would be better served.
Reforming Farm Policy and Programs. Expanding the reach of existing conservation programs—as recommended above—should be the minimum expected from legislative action in the next farm bill. But it will be a serious mistake, for agriculture and American taxpayers, to settle for the minimum at this juncture.
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Participants told us it was time —for a new vision for agriculture— as one participant put it. They wanted a new farm policy that supported—through conservation—all agricultural producers, producing all kinds of crops and livestock, on all kinds of land, in all regions of the country. Their goal was to keep people on the land, and they were skeptical about the effectiveness of traditional approaches to supply control, price support, and income subsidies. They recognized that producers who relied on production of subsidized commodities for a large share of income from their operations had become very dependent on government payments. But they worried that such dependence was unsustainable and not in the best interests of agriculture, taxpayers, or the environment.
Concerns about traditional farm programs. Abundant and cheap supplies of food and fiber, income support for struggling farmers, and economic support for rural communities are the three most often stated objectives of traditional farm policy. Those traditional policies are being challenged on their ability to address all three of these objectives.
Underlying all of the questions being raised is the fact that major structural changes have taken place in agriculture. In 1999, according to USDA's Economic Research Service (ERS), almost 70 percent of the value of all crops and livestock was produced by 8 percent of producers operating just 32 percent of all farm acres. From the standpoint of crop sales only, 8 percent of farmers accounted for 68 percent of crop sales from just 32 percent of all farm acres. The productive capacity of American agriculture is a miracle. In fact, American agriculture is so productive that it is questionable whether subsides are needed anymore to ensure an abundant and cheap supply of food and fiber.
The distribution of government subsidy payments has concentrated in fewer and fewer hands as production of subsidized commodities has concentrated on fewer and fewer farms. For example, about 47 percent of government payments in 1999 went to the 8 percent of farmers accounting for 68 percent of crop sales. Ninety-two percent of producers operating 68 percent of farm acres and producing 42 percent of crop sales shared the remaining 53 percent of government payments. As a result, the distribution of government payments diverges from what most taxpayers would recognize as equitable or efficient income support.
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Fundamental changes in the nature of rural economies also have reduced the effectiveness of farm subsidies as economic development engines for rural communities. According to another ERS study, only about 37 percent of farm subsidies payments went to farmers in counties where those payments would be expected to play a significant role in the local economy.
At the same time, recognition of the importance of farmers and ranchers as natural resource and environmental managers is growing. Working land—land used primarily to produce food and fiber—is, literally, the last frontier for environmental enhancement. Just as the land use and management decisions made by producers can impair the environment, those decisions also can create fish and wildlife habitat, contribute to clean and abundant supplies of water, protect against the risks of climate change, and create recreational opportunities.
More balance in farm policy. Room should be made in farm policy itself for a program that supports farmers and ranchers based upon their unique role as caretakers of most of the land in this nation, rather than as producers of commodities that, more often than not, are in oversupply.
The traditional tools of farm support clearly have their place in a new farm policy. Those tools will be particularly important for those producers who depend largely or exclusively on income from sales of undifferentiated commodities—the raw materials of the modern food and fiber production system. But we also think there is great advantage to agriculture and taxpayers by bringing on line new tools that hold greater promise for all of agriculture, rural communities, and taxpayers. Those new tools should include research, marketing assistance, rural economic development, and conservation, among others. Most of those tools really are not new. What would be new is a farm policy that seeks to create a better balance in policy attention and funding among the tools—a balance based on clear recognition of the realities of the current structure of agriculture, the food and fiber system, a global economy, and the environment.
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Conservation has unique advantages as a component of a more balanced farm policy. For taxpayers, conservation at the center of farm policy would allows us to go beyond damage control, and even pollution prevention, to widespread environmental enhancement. To go beyond meeting minimum standards required by regulation to release creativity and entrepreneurial spirit in the service of conservation and environmental quality. Working cooperatively with the nation's farmers and ranchers as partners in environmental enhancement could become the third leg of this nation's conservation stool complementing land acquisition and regulation where needed—to create a balanced approach to environmental management.
For agriculture, such a policy change would create the opportunity to use conservation to help keep people on the land and to escape some of the contradictions created by current farm policy. The land and its management would drive conservation rather than the amount or kind of commodities produced. That means all farmers and ranchers, producing all kinds of commodities, in all regions of the country could participate in environmental enhancement.
Conservation could and should reach those 92 percent of farms operating 68 percent of the acres, but producing only 31 percent of the value of food and fiber products. Though many of these producers are not big players in the commodity market or international trade, those producers are, or could be, big players in the conservation market. Producers in Canada, Mexico, Argentina, Brazil, and France can compete in corn, soybean, wheat, and beef markets; they cannot compete with this nation's farmers in contributing to clean water or fish and wildlife habitat. The environment is a niche market, but one in which every farmer and rancher has a niche.
Using conservation as a basis for support programs would provide more options for policymakers and producers, instead of attempting to fit an increasingly diverse and complex agricultural sector into a one-size-fits-all subsidy program. This nation could diversify agricultural policy to reflect the needs and unique circumstances of different farming and ranching operations. It could design a policy that works for those handful of producers who dominate commodity markets and trade, and it could design a policy that works for all those other producers in whose hands the country entrusts the management and care of most of its land, water, and wildlife.
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Stewardship-based option for agriculture. Congress should authorize a minimum of $3 billion dollars within farm programs for a stewardship-based farm and ranch program that rewards producers for utilizing their land, labor, and capital to enhance the environment. This new program should be open to all agricultural producers of all agricultural commodities in all regions of the country.
This new program should reward good actors through technical services and maintenance fees to keep existing conservation systems and habitat in place on their farms and ranches. It should also pay farmers and ranchers who want to do more by installing new conservation systems. Those payments should be determined by (1) relying on local input to identify the environmental goods and services of most value to the local community and relying on states to harmonize those values with state and national values, (2) calculating payments based on ''level of effort'' as estimated by cost, on a preliminary basis, of the practice and any economic value forgone until the technical capability to quantify benefits directly is strengthened, (3) distinguishing between ''maintenance costs'' and ''installation costs'' when valuing existing versus new investments in conservation, and (4) tithing the funds made available to the new vision program to invest in the research and testing needed to develop tools to estimate environmental benefits
We think the issue of what taxpayers should be expected to pay for and, alternatively, what farmers and ranchers should be expected to pay for themselves will loom large, especially if billions of dollars of taxpayers' money are at stake, as we recommend. This issue has already been raised, for example, in implementation of EQIP. Large, confined animal feeding operations have been declared ineligible for financial assistance for the design and implementation of manure management structures. The determination of who gets paid and what they get paid for involves questions of justice, fairness, and social values, in addition to environmental goods and services. Failure to resolve such issues could and probably will create a serious stumbling block for implementation of a program that achieves the vision created by our workshop participants.
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We think the best way to resolve these issues would be for local producers and citizens—with guidance from USDA state technical committees—to define a ''minimum bar'' over which producers must pass to become eligible for payments under the new vision program. This minimum bar would represent a general agreement between producers themselves and local citizens on those conservation practices that are considered a minimum obligation of land ownership and those practices that go beyond that minimum and deserve taxpayers'— support.
The new stewardship-based farm and ranch program could and should be designed to complement existing conservation programs in five key ways—be available to all producers based on their willingness to make a commitment to conservation; prevent conservation problems before they require more expensive treatment; spur widespread enhancement of the environment rather than damage control; emphasize a transition to production systems that enhance, not just protect, the environment; and emphasize development, field-testing, and demonstration of innovative production systems that integrate conservation directly into food and fiber production.
Reaffirm and strengthen conservation compliance. The role for compliance measures in a new farm bill was a contentious issue for workshop participants and during our deliberation leading to the recommendations in this report. A fully funded, effective conservation program of the magnitude envisioned in this report would be the preferred way to jumpstart conservation and environmental enhancement on farms and ranches across the country. However, the history of funding since 1985 clearly shows that actual appropriations often lag well behind authorized levels, and many new and promising conservation financial assistance programs have floundered because of lack of funding.
We think it is appropriate to affirm and strengthen current conservation compliance measures to address the following key concerns. Workshop participants were nearly unanimous in their sense of injustice if producers were allowed to break out fragile land and subsequently be subsidized by taxpayers for enrolling those acres in CRP or another conservation program. Participants thought this was an affront to good stewards and a prime example of conservation programs rewarding the wrong behavior. The so-called ''super sodbuster'' provision had, in the past, addressed this issue by precluding the breaking out and cropping of highly erodible land if a producer had already enrolled in the CRP.
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Crop insurance, revenue insurance, and other legitimate programs to help producers manage risk can create significant incentives to bring fragile and risky land into production. Crop insurance is currently exempted from compliance provisions—an exemption created to encourage participation and reduce reliance on annual disaster payments. Crop insurance reform with its increased subsidies, however, appears to have spurred participation in the program, and the potential for heavy reliance on revenue insurance as a mainstay of risk management and income support suggests to us that it is time to extend conservation compliance to crop insurance and any new insurance-based approaches to risk management and income support that may be authorized in the next farm bill.
Finally, the highly erodible land provisions of the 1985 farm bill, though effective, appear to have left unaddressed an important segment of the nation'—s soil resources. About 50 million acres of nonhighly erodible land is, according to the 1997 National Resources Inventory, eroding at rates exceeding the soil loss tolerance. Asking producers who receive subsidies to take action to achieve a significant reduction in erosion on those acres—less than 15 percent of total cropland—would go a long way toward finishing the historic task started in the 1985 farm bill.
Mr. Chairman, members of the Committee, I want to thank you again for the opportunity to share our thoughts with you today. A review of the testimony posted on the Committee's website makes it clear that shaping a comprehensive farm bill is a daunting task. The competing visions and priorities reflected by that testimony is evidence of the complexity and importance of agriculture to the economy, the environment, and taxpayers. SWCS would like to offer help whatever way we can as you undertake this task.
Statement of David Stawick
Chairman Lucas and Congressman Hilliard, thank you for the opportunity to submit this testimony.
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The Alliance for Agricultural Conservation is a new project of the agribusiness firms that have sponsored the National Conservation Buffer Council for the past three years. These partners are: Cargill, Inc.; ConAgra, Inc.; Farmland Industries, Inc.; Monsanto Company; Pioneer Hi-Bred International, Inc.; and Syngenta Crop Protection, Inc. The Buffer Council is pleased to note that we have reached the one-million-mile mark on the way to the U.S. Department of Agriculture's goal of the establishment of two million miles of new conservation buffers on private agricultural lands by 2002.
The mission of the Alliance for Agricultural Conservation is quite simple: to advocate additional financial incentives for farmers and ranchers to apply conservation measures on and in association with working agricultural lands.
Our emphasis on conservation on working lands is not unique. For example, Congress realized the challenges of working lands conservation when it developed the Environmental Quality Incentives Program (EQIP) as part of the 1996 farm bill. We are pleased to see that a wide variety of agricultural commodity and conservation groups are also strongly advocating additional attention to working lands at this time.
The farm bill debate provides all of us the opportunity to boldly increase our efforts to spur conservation on private lands with the same vigor President Theodore Roosevelt employed as he championed public land conservation a century ago. A Roosevelt biographer wrote that the President's conservation program was ''great forward-looking statesmanship.'' That same vision and leadership is needed today for private lands conservation.
The environmental challenges that face America's farmers and ranchers are daunting. Foremost is water quality, from Total Maximum Daily Load regulations to hypoxia strategies at the national level, down through a matrix of steadily proliferating state and local initiatives. Confined livestock raise water quality and odor issues. Soil erosion continues to bedevil us. And agriculture is also looked to as an important source of wildlife habitat.
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Society in general will benefit from the environmental improvements that will follow from increased adoption of the ''Core 4'' conservation practices—conservation tillage, integrated pest management, nutrient management and conservation buffers. In light of these benefits (including cleaner water and air, with attendant monetary savings) and because many farmers and ranchers are not in a position to pass along the net costs of their conservation activities, it is reasonable that society assist landowners in defraying these costs. In a nutshell, this is the justification for the additional incentives we seek for agricultural producers.
The Alliance for Agricultural Conservation suggests four strategic issues that should be addressed in the conservation title of the next farm bill. These issues and related policy options follow.
Address shortages in incentives for conservation practices on working agricultural lands. As mentioned earlier, EQIP was a tremendous step forward, owing to the mandatory nature of its funding, its targeting to environmental priority areas and, of course, its aim at working lands. Although EQIP's $200 million authorization was a sizable annual investment, it falls far short of demand, which has in recent years been more than $600 million.
As you are aware, many colleagues in agricultural and conservation circles have developed estimates of what it will take to assist landowners in dealing with the widening circle of environmental challenges. A number of livestock organizations—reporting from agriculture's water quality ''front lines''—testified at an earlier hearing of the need for at least an extra $1.2 billion per year in incentives for nutrient management. Looking at the panoply of expectations society is placing on agriculture, I would say this is a conservative estimate.
In addition to more incentive funding, we would suggest two improvements to EQIP or whatever program might succeed or accompany it in the future. First, the priority area concept should be strengthened by an ongoing enrollment process for practices returning particularly high environmental benefits. This would be similar to the Conservation Reserve Program (CRP) continuous signup option for buffer practices, which has been much more farmer-friendly than the regular CRP's periodic national enrollments. Second, while selective targeting has been positive, it may now be appropriate to place some of the new funding in regions other than priority areas. This would promote the ethic of conservation on all working lands and widen the base of support within agriculture for conservation funding.
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Leverage Federal conservation funding through market-based initiatives. In many regions there may be strong but yet untapped economic justification for state or local governments, utilities or business entities to provide incentives to landowners who adopt conservation practices. For example, a drinking water supplier facing the necessity (and cost, which will be passed along to rate-paying customers) of building new treatment facilities might find it much less expensive to instead go up into its source watershed and pay farmers and ranchers who voluntarily make additional reductions in pollutant discharges, therefore obviating the need for increased treatment.
This might be done by establishment of local ''best management practice (BMP) funds,'' from which EQIP-style payments could be channeled to participating landowners. The premiere example of this concept is located in the source basin for New York City's municipal water supply, which has extensive dairy operations. Another approach might be through a system of pollutant ''credit trading'' in which large industrial point sources contract with individual farmers to voluntarily reduce their pollutant output in the same watershed. By purchasing such a ''credit'' from an agricultural landowner, the point source would be relieved of some of its discharge reduction requirements.
While the examples I have mentioned have focused on water quality, similar approaches could be used to promote carbon sequestration. Depending on the outcome of international negotiations on global climate change, carbon sequestration could be a nascent environmental opportunity for farmers and ranchers.
What role might the Federal Government play in these otherwise market-based strategies? The most effective might be to assist in the capitalization of BMP funds or credit trading scenarios. For example, in qualifying projects, the Federal Government might put in $1 for every $2 or $3 that a nonFederal entity or business contributed to a BMP fund or dedicated for buying pollutant credits. The Federal money would have to be passed through to farmers.
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BMP funds and credit trading are not a substitute for other incentive programs such as EQIP but they hold the potential for focusing intensely on problem areas. Intriguingly, they also change the reality of some conservation practices from net monetary expenses to new sources of value and income for rural landowners. Finally, considered from the perspective of the Congress, the ''leveraging'' effect of these market-based initiatives can dramatically multiply the benefits of Federal investments in conservation.
Increase agricultural landowners' access to conservation technical assistance. In contrast to the burgeoning environmental challenges to farmers and ranchers, the ability of the Federal Government to provide necessary technical assistance to landowners has, in real terms, actually declined. Staffing levels for the U.S. Department of Agriculture's Natural Resources Conservation Service have fallen by about 2,100 positions in the past decade.
Ponder this daunting statistic concerning the development of comprehensive nutrient management plans (CNMPs) as proposed under the Federal Government's animal feeding operation strategy. NRCS has estimated that at current staffing levels, it would require 30 years to provide the technical advice necessary for all the landowners who might be required to have the CNMPs.
I want to be clear that AAC strongly supports the NRCS and the local conservation districts with which the agency partners to deliver technical aid. We also believe NRCS should receive more support from within USDA and we hope Secretary Veneman will make this a priority. But we also would suggest that current realities and likely future demands dictate a rethinking of NRCS's role in the delivery of conservation technical assistance.
One option to consider would be to focus NRCS field staff on the needs of landowners with limited resources (in practice, this is already the case in many areas). Simultaneously, the needs of larger, better capitalized landowners could be met by private sector entities such as crop advisors, engineers, agronomists and farm managers whose qualifications to make conservation recommendations are certified by NRCS. Again, this is not a radical notion; NRCS already has a third-party certification process.
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What I am suggesting is not a proposal to reduce NRCS's budget or human resource levels. In fact, it is conceivable that increases in either or both could be justified under the scenario I outlined. But recent history strongly suggests that NRCS, as currently focused, will not receive the increases in funding necessary to provide the technical assistance that is needed in the countryside.
Examine a comprehensive national policy for working lands conservation. Our nation's natural resources are protected by a patchwork (some might say a ''crazy quilt'') of sometimes-overlapping laws and regulations authorized by several statutes under the jurisdiction of different congressional committees. While the environment is generally well served by this regime, it can produce exasperation for landowners and actually produce barriers to better environmental stewardship.
A classic example involves wetlands. They are protected by the ''Swampbuster'' program laid out in the 1985 farm bill and administered by USDA, and by the multi-agency program authorized by Section 404 of the Clean Water Act. Not only do these initiatives overlap, they have different criteria. Then there are water quality programs. Federal-level legislation includes the Clean Water Act, the Safe Drinking Water Act and the Coastal Zone Management Act, which yield various Federal and state regulations.
Meanwhile, our conservation incentive programs such as CRP and EQIP either implicitly or, in some cases, explicitly, are geared to help landowners meet the requirements of the laws and regulations I just mentioned. But there is no guarantee—no ''safe harbor,'' if you will—that participation in one of these incentive programs will result in compliance with pertinent environmental requirements.
This is one of the situations we sometimes see in our society that we jokingly remark would prompt an intelligent life form from another planet so say, ''Who thought this up?'' The answer, of course, is well-meaning members of Congress who serve on different committees. And well-meaning executive branch officials who work for different agencies.
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Because of this disparate authority, you in the Agriculture Committee cannot bring order to this situation alone and you probably cannot do it in the next farm bill cycle. But you may want to consider taking a near-term step that can start down the road to streamlining. While it might be argued that we have enough government commissions, you might want to consider in the next farm bill authorizing some sort of panel that could identify legislative and regulatory overlaps, point out the congressional jurisdiction barriers to what might be called traditional harmonization strategies (joint or sequential referral of bills, conference committees with members from multiple authorizing committees, etc.), and suggest strategies for moving legislation that could bring landowners more regulatory certainty.
Another option might be to direct USDA and the agencies charged with carrying out the various environmental statutes to undertake a similar review and report to Congress. Such an approach might produce not only a legislative roadmap but also more immediate protocols between Federal agencies (and, where appropriate, state regulators) that would provide more encouragement for landowners to undertake conservation activities.
I close with two final suggestions that impact on all the strategic issues I mentioned. First, delineate goals for what the conservation title of the next farm bill should accomplish through voluntary, incentive-based programs. Should we try and reduce agriculture nonpoint source pollution by 25 percent? Maybe 50 percent? What about soil erosion? What percentage of our lands should meet the soil loss tolerance? How should we harmonize confined livestock production with expanding urban boundaries? What support is appropriate for landowners currently implementing conservation measures? Answers to these questions will lead you to more rational decisions on how much should be spent on incentive programs—and increase the likelihood of receiving the political support necessary to secure new funding.
Second, make environmental performance your guiding beacon in this process. As you debate conservation incentive programs and the next generation of commodity programs, there may be proposals from some circles to effectively combine the two into some sort of ''green payment'' scenario. The environmental hook could be to pay farmers for what they're already doing, which is not necessarily a bad idea. But the end result could be to get little new conservation on the ground. Such a gambit might be a clever way of justifying government payments to farmers but it would ultimately be cruel to landowners staring down the gunbarrel of environmental regulation and hollow for urban dwellers who also stand to benefit from conservation on working agricultural lands.
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Thank you again for the opportunity to submit this testimony on behalf of the Alliance for Agricultural Conservation.
Statement of the Native Seed Trade Association
The Native Seed Trade Association (NSTA) proposes that the production of native seed be included among the permissible enterprises within the Conservation Reserve Program. Ideally, the efficacy of this proposal will be tested over several years in a pilot project that includes a number of different habitats around the country. We believe that native seed production dovetails perfectly with the interests of the CRP and that such a pilot project will be an inexpensive means of demonstrating its value. Below, we will briefly describe the native seed industry and underscore how it fits into the CRP. We will also summarize our research among prospective participants in such a pilot project in Southwestern Georgia. Finally, we will outline the details that we feel will give the pilot project the greatest opportunity for success.
THE NATIVE SEED INDUSTRY
What are native seeds?. Native seeds are the seeds of plants that naturally occur in a particular region. Because these plants are naturally adapted to this region, they thrive without the sort of assistance that most agricultural crops require. For example, NSTA warns against irrigation or fertilizing, because these practices will eventually deplete many of the advantages that native plants offer. In part, because of these characteristics, native seed is in great demand.
Who buys native seed? Native seed is essential in any attempt to restore native habitat. Many government agencies at all levels of government are large consumers of native seed. Since February 3, 1999 Executive Order 13112 [Invasive Species] et al. have formalized this governmental demand for native seed. And yet, the production of native seed is a mere fraction of the demand. In fact, there have been numerous interagency meetings to discuss the shortage of native seed. In addition to the governmental market there are hundreds of small businesses conducting restoration programs on public and private lands. Almost all of these require native seed. Almost all have difficulty obtaining the seed they require. A growing native seed industry will allow small farmers and private enterprise to solve one of government's more intractable problems.
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How is native seed produced? In order to begin a native seed farm, the producer must first gather enough native seed to serve as founder stock. Out of this stock he rears his crop. Because even this initial seed is difficult to purchase, much of it is wild harvested. The producer finds large remnant stands (populations) of native plants, then he gets permits from the owners of that land to collect the seed, and then he uses this seed as founder stock for a crop of native plants on his own land. Many native plants take several years before they become financially productive. This process can be difficult and time consuming.
How does native seed production fit into the CRP? he CRP seems designed with native seed production in mind. All of the goals of the CRP are robustly fulfilled by the production of native seed on CRP acreage. Here are some effects of native seed production and how they relate to the interests of the CRP:
The Family Farmer acquires an alternative crop to protect his farm. The CRP, like all USDA programs aimed at the small family farmer, seeks to find ways of preserving this way of life. Native seed can be a lucrative crop—often selling for hundreds of dollars a pound. By permitting the production of native seed, the CRP will offer the farmer a long-term alternative to commodity crops without compromising any of the other goals of the CRP. However, developing a productive native seed crop can take several years; CRP rental payments will provide farmers the opportunity to enter this growing industry.
Native seed production is an ideal means to prevent soil erosion. The CRP began with the goal of abating the erosion caused by farming on marginal lands. The crop of native seed producers will be the native plants that pre-date agriculture in those locations. These plants are usually perennials and are never harvested completely. The soil is always under cover. Moreover, because the plants are native, they are highly adapted for success in that soil.
Native plant production will permanently remove land from the production of commodity crops. Another early factor in the CRP was the desire to support commodity prices by removing marginal land from production. In fact, one of the criticisms aimed at the program has been that its effects are too impermanent. For example, once acreage comes out of the program, the farmer has little incentive not to replant in commodity crops. If, on the other hand, the farmer is permitted an alternative crop, his impetus back toward the commodity crop is diminished.
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Native plants are exactly the right habitat for local wildlife. CRP has become one of the most successful methods for protecting critical habitat for wildlife and rare plant communities. The methods used to produce native seed not only protect habitat, they extend it.
THE SOUTHWEST GEORGIA EXAMPLE:
The American Farmer does not want help. He wants the opportunity to help himself. This is why, all over the country, farmers are experimenting with alternative crops. The Native Seed Trade Association believes that converting marginal land to the production of lucrative native seed makes sense for many farmers. In particular, land under the CRP seems ideal for native seed farming.
Of course, the question is whether the farmers themselves would be interested. In researching this issue, we visited with several farmers in the 2nd and 8th Districts of Georgia. Our visit was not intended to be a thorough survey; we only wanted to speak with one or two local farmers about their experience in the CRP. The response, however, has been overwhelming. Over 100 South Georgia farmers have called or e-mailed expressing an interest in participating in this project. In addition to the farmers themselves, several local organizations have indicated a desire to participate in developing this project. For example, The Jones Ecological Center has indicated a willingness to provide support to the Native Seed Trade Association and any group of local farmers willing to begin production of native seed.
It is the farmers, though, who offer the most enthusiasm for the project. Farmers are normally conservative, skeptical people. They are realists. And, when they hear about the potential of native seed production, they ask hard questions. In the end, they believe they can make it work. Ultimately, they will be the ones who will have to.
THE PILOT PROJECT
After listening to the farmers of Southwestern Georgia, the Native Seed Trade Association has formulated an outline of a program that will have the faith and backing of the farmers who would participate. This program involves the proposed changes to the CRP regulations, but it also requires commitments from the farmers, various local organizations, and the Native Seed Trade Association
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The mission of the NSTA is to promote the production and availability of native seed. One of our principal objectives is to encourage traditional farmers to undertake the production of native seed. Even if farmers receive CRP rental payments, they will still need other forms of assistance. NSTA understands that its role will be to provide comprehensive training programs in all aspects of native seed production. Perhaps most importantly, farmers and their cooperatives will need ongoing technical advice and the support of other native seed producers from around the country.
Our mission in Georgia is to organize cooperatives of farmers interested in alternative crop opportunities. The methods used in the development of this cooperative would serve as a model for creating other native seed cooperatives in areas of the country where demand for seed is the greatest [e.g. the Mid-Atlantic and Southeastern regions, and the great burn areas of the West.] The rental payments required to build incentive among traditional farmers must be at least $100/acre—we arrived at this number by talking to traditional crop farmers (e.g. soybeans, peanuts, corn, cotton) and all of them concurred that it would not be worth their effort if the rental payments were less than $100/acre. There was also a strong consensus among the farmers with whom we spoke that they would not participate if the permitted acreage were less than 25 acres. Because of the miniscule quantity of seed stock available to start the program, only a few acres can be planted in the first year. We recommend that there be incremental increases in acreage as seed becomes more available for planting. We are advising farmers to begin with a small parcel in the range of 25 acres to begin a founder population and that with each subsequent year they will be able to plant more acreage as more seed is accumulated with a maximum of 25 acres being the target for each of the 10 farmers in the duration of the Pilot Project.
We will develop and implement a training program to teach farmers how to identify remnant populations of native plant communities, how to harvest a breeder or founder population of seeds from those remnant sites, how to plant those seeds in a particular species assemblage that matches the ecosystem they will be growing in, how to harvest the seeds from that planting and how to begin planning and planting for larger scale harvests. They will be trained in how to clean and process the seed and also how to market their product. This training program will be segmented and held over an 18 month period. As most of the native plant species of interest are perennial grasses, establishment of these grasses will take at least 3 years. Once the native plant species have become established and are growing in a healthy and stable system, seed harvest will then begin. The actual planting of natives will be in grassland/meadow/pasture type settings with high species diversity that will contain a 70:30 mix of grasses and forbs (flowering plants). This is the best system to restore ecosystem health by creating critical native habitat that fits into the surrounding environment.
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In summary, NSTA recommends:
To provide adequate incentive for farmers to invest in native seed production, rental payments should be at least $100 per acre.
We [NSTA] would require that each farmer include a minimum of 25 acres in the native seed production program.
We require source identified ecotype seed. The founding or breeder population of seed must match the ecotype in which it will be grown and NSTA will coordinate the source identification requirement.
The planting will be done in meadow/prairie like situation with a composition of native cool and warm season grasses and native forbs. The ratio of at least 7 species of grasses and 3 species of forbs (flowering plants).
The period of the pilot project should be a minimum of 10 years
No harvest of grass seed can take place for the first 5 years as it will take that long to get the level of production economically and environmentally viable.
Harvest of the seed will take place every other year after the initial 5 years and rental payments will be reduced by 50 percent in those years.
For those farmers who want to participate but do not want to produce seed and have an interest in producing organic Hay - the same rules will apply.
All seed from each ecotype area (conservation district) will be harvested and processed under the supervision and management of the local native seed producers cooperative. Each cooperative will be responsible for maintaining the integrity of the particular ecotype seed for their region. All seed will be processed in the cooperative and will be marketed and sold by the cooperative.
The Native Seed Trade Association would like to thank the Subcommittee for this opportunity to express its views on the Conservation Reserve Program. If any members have further questions concerning native seed production or this pilot project, we are always available to offer our advice or hear your recommendations.
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Statement of Jamie Clover Adams
Mr. Chairman and members of the subcommittee, thank you for the opportunity to present testimony on the conservation provisions of the next farm bill. My name is Jamie Clover Adams. I am the Secretary of the Kansas Department of Agriculture, and I appear today on behalf of the National Association of State Departments of Agriculture (NASDA) and my fellow Secretaries, Commissioners, and Directors from across thee Nation.
What I will present today is the broad outline of a bold, new environmental program for the 900 million acres of America's open space resources that are under the care and stewardship of our agricultural producers. This new state ''Agricultural Stewardship Program'' would be a ''block grant'' type initiative designed to give state and local governments greater flexibility, innovative tools, and resources to implement agricultural conservation priorities. At the outset, I need to stress that the proposal we are offering for the Subcommittee's consideration is a work in progress. It is the result of extensive discussions over the past several months among the Secretaries, Commissioners, and Directors of Agriculture from throughout the country, formally adopted as a NASDA policy recommendation during our midyear meeting in February. Since then, we have refined and elaborated on our proposal after discussions with other stakeholders and stand ready to further refine it with input from this Subcommittee.
Significant gains have been made in addressing traditional agricultural environmental concerns over the past decade. Soil erosion has decreased, as has the loss of wetlands, and wildlife habitat has been enhanced. We credit existing conservation programs for a good deal of this progress and recommend their continuation with increased funding, along with some modifications that I will mention near the end of my testimony.
Although we have been making progress in several conservation areas, the scope and range of environmental challenges faced by our farmers and ranchers have expanded, while environmental regulations have increased and changed along with the public perceptions, priorities, and the science that underlie them. My colleagues and I strongly support and encourage the use of existing USDA-managed conservation programs. At the same time, many of us have recognized that successfully meeting the new environmental demands is a ''make or break'' challenge for the farmers and ranchers we serve. We have begun to move on our own to try and fill the gaps in existing programs.
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These initiatives have taken different forms in each region of the country, reflecting state and regional differences both in what our farmers produce and in the most pressing agricultural challenges that they face. For example, the Kansas Department of Agriculture (KDA) created a Pesticide Management Area (PMA) in the Delaware River Basin of Northeast Kansas to limit the input of atrazine and other soil-applied herbicides into area surface water. Many agencies and entities assisted KDA to gather data and educate area residents, including the State Conservation Commission, U.S. Geological Survey, Kansas State University and Kansas Department of Health and Environment. The primary goal was to bring the amount of the chemical atrazine to below three parts per billion in area surface waters.
Voluntary recommendations were developed for agricultural uses according to the tillage practices being used by the farmer. Further, after the PMA' inception, atrazine makers amended the Federal pesticide label to lower recommended application rates and adopted other water quality protection practices developed for the Delaware PMA program. The proposal also suggested application methods and encouraged using alternative weed control practices, stream buffer zones and vegetative buffer strips.
I11 Kansas State University published recommendations in an atrazine Best Management Practices (BMP) guide which had been developed through work at the Foster Farm research site. The Kansas State Conservation Commission (SCC) offered a pilot incentive program ($5/acre) to farmers in one critical watershed (Mission Lake) to encourage adoption of KSU-recommended BMPs. Further, farmers were contacted on more than one occasion by both the SCC and a KSU Extension employee dedicated to the project. Participation was nearly 100 percent. (Only one farmer did not participate because he grew soybeans only and did not use atrazine.) Outreach to farmers and property owners was the biggest challenge. Cooperating agencies worked hard to make cost-share incentives available to producers but, in point of fact, personal contact was equally, if not more, important to the success of the Delaware PMA. Finally, all waters in this area have been removed from the atrazine-impaired waters list except Tuttle Creek (which receives 80 percent of its pesticide load from Nebraska). Kansas and Nebraska are now working together to address this remaining issue.
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Other states like New York have focused on nutrient management planning for dairy producers as a key environmental challenge, developing the Agricultural Environmental Management (AEM) program to provide direct technical assistance to dairymen and cost sharing for need improvements. The New Jersey Urban Conservation Action Partnership concerns itself with the issues that arise when farming coexists with urban and suburban development. Southwestern states are looking at programs that have a large water conservation component—an issue that is front and center in many parts of the country.
Each of these new state programs is designed to supplement those that already exist to help farmers carry out their stewardship function and bear the cost of what we see as substantial public benefits: open space conservation, resource preservation for future generations, and clean air and water. Each is voluntary, incentive-based rather than sanction-based, designed to address local needs while complementing existing programs, and carried out in collaboration with all the Federal and State agencies already engaged in local environmental management activities.
NASDA has testified before other congressional panels concerning environmental questions such as Total Maximum Daily Loads (TMDLs). Our goal will always be to assure that legislation that effectively mandates huge investments in new technology and new management practices does not put good farmers and ranchers out of business. We will continue to work on all fronts to preserve a sensible regulatory environment. At the same time, we understand that the rules of the game will keep changing.
NASDA' proposal builds on existing planning systems and infrastructure—it does not duplicate existing programs. Our intent is to fill in the gaps, which will only increase in the future due to changing public expectations and regulatory requirements. This new approach will provide a better ''toolbox'' and tools to meet these needs. The potential benefits and rewards of our program are enormous because it would:
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Reach all producers, thus provide greater environmental benefits overall;
Give states flexibility to address their most critical problems;
Target resources to where they are most needed on a site-specific basis;
Increase local buy-in to find workable solutions;
Emphasize preventive measures, which are more cost-effective and offer more economic returns;
Simplify program delivery;
Address the expanding list of new problems (i.e., carbon emissions, etc.)
The state departments of agriculture also stand ready to work with the Subcommittee to examine resource and funding delivery and needs. This is a high priority and the key element for an effective Federal-state partnership in agricultural policy. We believe that there is a strong public policy argument for Federal cost sharing to help agricultural producers deal with changes in what the public expects in the way of environmental management. A good analogy would be the assistance provided by the Federal Government over the past three decades in upgrading municipal water treatment facilities to meet Clean Water Act requirements. Today our waters are cleaner than they have been in generations. Thanks to Federal support for necessary local investments, this enormous progress toward a national goal was accomplished without bankrupting small cities and towns.
Today, public expectations, increased regulation and a growing list of environmental challenges are demanding on-farm environmental enhancements that are beyond the short-term and long-term economic payback for producers. For example, many conservation practices have high capital or management input costs, but do not generate additional revenues. Agriculture is not organized in a fashion that allows increased costs of production to be passed on to consumers. As such, on-farm expenditures for conservation compete directly with servicing farm debt and other family financial needs. In addition, implementing more stringent and complex standards usually increases the need for more costly approaches and technologies. Farmers are ready to do their part in accomplishing current and future national environmental goals. However, what will be expected of a cattle feeder in North Dakota will be quite different from the challenges faced by citrus grower in Florida.
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Our Agricultural Stewardship Program asks the Federal Government to recognize two key facts:
A one-size-fits-all approach toward helping agriculture meet the environmental challenges of the next decade will leave some regions and the producers of some crops or livestock products out in the cold.
Local leadership is required for designing and implementing realistic programs, focused on what local stakeholders agree are the most pressing local agricultural environmental problems.
Our State Departments of Agriculture stand ready to provide that leadership. As I have noted, many are already moving forward to design and implement effective producer-oriented environmental programs, utilizing local and state resources. Programs like Kansas' Pesticide Management Area (PMA) have the potential, given the resources, to assist even more producers for the benefit of the environment and our agricultural industry.
NASDA believes that an effective state ''working fund'' for agricultural environmental stewardship will have these characteristics:
Funding will come through cooperative agreements between USDA and State Departments of Agriculture, which will be the lead agencies in designing and carrying out programs; similar to the way State Revolving Fund grants are provided by the Environmental Protection Agency (EPA) to the states upon approval of an Integrated Use Plan;
Program parameters will recognize activities designed to enhance protection of land, water, air and wildlife in the broadest terms possible, without duplicating existing planning systems and infrastructure;
States will have the flexibility to allocate dollars between payments to producers and/or technical assistance, based on local needs and priorities;
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Producer participation will be voluntary, incentive-based, and targeted toward those environmental enhancements that are supported by sound science and produce measurable results;
Contract payments to participating producers will be made on an annual basis;
All programs will have provisions to protect individual producer privacy and data confidentiality.
Farmers and ranchers have provided tremendous environmental gains through participation in conservation programs established in the 1985, 1990, and 1996 farm bills. These programs are generally working well. However, limitations and inequities are preventing these programs from achieving their full potential. Let me now briefly outline our suggestions for changes in three existing environmental programs.
Wildlife Habitat Incentives Program (WHIP) - NASDA recommends that WHIP be redirected with the addition of a Critical Habit Incentive Program (CHIP). This addition would dedicate a specific proportion of resources within an increased WHIP appropriation to carry out voluntary critical habitat enhancement, and would give a higher priority to enhancement of critical habitats within the program as a whole.
Environmental Quality Incentives Program (EQIP) - NASDA has several recommendations, starting with our proposal that states be given more flexibility and discretion to decide eligible conservation practices. We further noted that:
The national size restriction for EQIP livestock projects limits opportunities for producers. The 1,000 animal unit threshold may seem large in Michigan, but it is small by Kansas standards.
Many practices outlined in the EQIP guidance for livestock practices do not work well for smaller producers and those who may work other jobs-a category of producers that is increasing in many states.
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The program should allow for one-year contracts and should remove the $50,000 payment cap.
Conservation Reserve Program (CRP) - NASDA recommends that approved maintenance of land enrolled in the program should include grazing, under the following conditions:
NRCS has determined that maintenance is required on the land to maintain plant heath, ground cover and/or improvement of wildlife habitat;
Grazing must be high-intensity and short term, to provide benefits that may be more environmentally beneficial than burning, disking, clipping, or spraying;
The CRP rental payment is reduced at a rate equal to the value of the forage or the maintenance fee; and
The payment, time of year, and frequency of maintenance will be according to a determination by the local technical committee.
In closing, I would like to note NASDA' strong view that, budget realities notwithstanding, investment in agricultural environmental stewardship should not be viewed as simply one more category of farm program spending. Should it be viewed in that way, a substantial additional investment in support for producer-level environmental enhancements will tend to trade off against unrelated programs designed to address consequences of low and unstable farm prices. An environmental stewardship ''working fund'' will not address the potentially disastrous implications of another year of low farm commodity prices, or point the way to stable long-term solutions to the underlying financial problems facing American agriculture. However, we know that our proposal will help us keep those farming and ranching operations that are most heavily burdened in helping achieve environmental goals from folding while we work to improve opportunities for growth and profitability in agriculture as a whole.
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Speaking for all my state colleagues, I appreciate this opportunity to present views on how we can support good agricultural environmental stewardship in every region of the country. We look forward to working with the Subcommittee to develop a Federal agricultural policy that provides necessary tools for a healthy and profitable agricultural industry and to help farmers and ranchers continue to be good stewards of the land. Thank you.
Statement of R. Max Peterson
Mr. Chairman, members of the Subcommittee, my name is R. Max Peterson. I am the Executive Vice-President of the International Association of Fish and Wildlife Agencies. The Association was founded in 1902 as a quasi-governmental organization of public agencies charged with the protection and management of North America's fish and wildlife resources. The Association's governmental members include the fish and wildlife agencies of the states, provinces, and Federal Governments of the U.S., Canada, and Mexico. All 50 states are members. The Association is a key organization in promoting sound resource management and strengthening Federal, state, and private cooperation in protecting and managing fish and wildlife and their habitats in the public interest.
The Association appreciates this opportunity to present to the Subcommittee our perspectives on farm bill conservation programs. The Association believes that agricultural conservation programs established under the 1985, 1990 and 1996 farm bills, have been some of the most important, significant and successful fish and wildlife conservation endeavors in the last 30 years with significant, tangible on-the-ground benefits. The farm bill has proven to be an effective mechanism for delivering both financial benefits to landowners and public benefits in the form of affordable food, and conservation of fish, wildlife, and soil and water resources. As a result, conservation programs continue to enjoy broad bipartisan support.
As you are aware, the State fish and wildlife agencies have broad statutory authority and responsibility for the conservation of fish and wildlife resources within their borders. The states are thus legal trustees of these public resources with a responsibility to ensure their vitality and sustainability for present and future citizens of their States. State authority for fish and resident wildlife remains the comprehensive backdrop applicable in the absence of specific, overriding Federal law. The State fish and wildlife agencies thus have concurrent jurisdiction with the Federal agencies for migratory birds, threatened and endangered species and anadromous fish. Because of our responsibility for and vital interest in the conservation of fish and wildlife resources, we have significant vested concerns in agricultural conservation programs.
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The conservation and sustainability of fish and wildlife resources depends on the availability and quality of their habitat, much of which is found on agricultural lands. The State fish and wildlife agencies recognize, appreciate and respect the fact that about two thirds of the land (i.e., habitat) in the United States is owned by private landowners. We also know that most private landowners want to be good stewards of their property and many embrace conservation as a prominent goal for their land management objectives. We believe that the State fish and wildlife agencies have generally enjoyed very good relationships with agricultural landowners, and the majority of those landowners are willing to work with the agencies to include fish and wildlife with their other land management objectives.
The Association believes that the key to unlocking the full potential of farm bill conservation programs is to focus on voluntary, incentive-based programs that provide:
Funding sufficient to address landowner demand for program enrollment and technical assistance;
Flexibility in program implementation to address regional and local differences in how program objectives can best be achieved; and
Income support for conservation practices on a wider array of farms, ranches and forests in all parts of the country.
Another important aspect to the success of current and future programs will be to insure that they are part of a comprehensive national agricultural policy to prevent different incentive-based programs from working at cross purposes and to address the public's expectations regarding the level of conservation benefits derived from tax dollars expended.
Commitment of State Resources to farm bill Conservation P