Expert Commentary

Environmental conservation in the farm bill: A research roundup

In this second of our three-part series, we look at environmental conservation programs that get billions of dollars in funding in the farm bill, which expires in late September.

farm bill
(Raychel Sanner / Unsplash)

The farm bill is wide-ranging legislation that sets funding and directs priorities for a variety of federal food consumption and production programs in the U.S. — plus, voluntary programs aimed at promoting environmental conservation on privately owned land.

Congress usually debates and renews the farm bill every five years. The first farm bill was passed in 1933, with 18 farm bills having been passed in all. The most recent farm bill passed as the Agriculture Improvement Act of 2018 and it expires at the end September, the end of the federal fiscal year.

Over the coming weeks, legislators will make the case for the next farm bill to include funding that supports the interests of their constituents, as well as lobbying and advocacy groups. To help guide journalists in coverage of those debates, The Journalist’s Resource is taking a look at academic research on three pillars of farm bills: SNAP, environmental conservation and rural development.

The research featured in this miniseries can inform the questions that journalists at local, regional and national outlets ask of federal lawmakers.

This week, we’re focusing on environmental conservation.

Environmental conservation programs are among the largest components of recent farm bills, according to a January 2022 report from the Congressional Research Service.

Conservation efforts made up 7% of the 2018 bill — $60 billion out of an estimated $867 billion over 10 years, according to the Congressional Research Service. Every five years, Congress may reauthorize, amend or add to existing conservation programs. The Congressional Research Service estimates the yearly cost for these programs will top $6 billion as part of the next reauthorization.

This research-based primer focuses on the benefits and costs of the Conservation Reserve Program, the longest running such program that is part of the farm bill.

It was introduced in the mid-1980s in response to an economic crisis among farmers brought on by increased borrowing, high inflation and other factors.

The program is the largest in the country aimed at replacing productive land with native vegetation.

Three-fourths of all land in the U.S. is privately owned, according to a July 2021 paper in Biological Conservation.

“Objectives of the CRP include reducing soil erosion, enhancing biodiversity, improving air and water quality, decreasing surplus production of agricultural commodities, and providing income support for landowners,” according to an August 2021 paper published in Applied Economic Perspectives and Policy.

Federal legislation in 2022 directed an additional $18 billion toward farm bill and other conservation efforts. These funds were part of laws aimed at curbing inflation, slowing climate change and reducing prescription drug prices.

There are three main overarching farm bill conservation programs:

  • The Conservation Reserve Program provides financial incentives for private landowners to remove large swaths of land from agricultural production. Since 2021, the program has particularly focused on encouraging the development of grasslands, which serve as habitats for a range of plant and animal life and can help prevent soil erosion.
  • The Environmental Quality Incentives Program, where technical experts from the U.S. Department of Agriculture provide free help to farmers interested in incorporating conservation practices into their ranching and crop production.
  • The Conservation Stewardship Program, which also provides one-on-one technical assistance, as well as annual payments to encourage agricultural producers to meet conservation goals over five year contracts.

With so much land privately held in the U.S., conservation hinges on financial incentives.

The major part of the Conservation Reserve Program involves private landowners, often agricultural or dairy farmers, voluntarily applying to refrain from growing crops and not letting livestock graze on parts of their land for a period of time — ten to fifteen years — in exchange for payment from the federal government.

A farmer who breaks the contract has to repay the government, with interest.

Conservation Reserve Program components

There are three main parts to the CRP program, which is administered by the U.S. Farm Service Agency.

“General CRP” includes entire fields or farms — these lands cannot be used anymore for or food or animal production. They are often lands at risk of environmental degradation, such as from soil erosion.

“Continuous CRP” focuses on conserving parts of land used for production, such as wetland areas, but not entire fields.

Grasslands CRP” allows animals to graze but prohibits farming or ranching.

As of July 2023, there were 8.4 million acres of whole fields or farms being conserved under the Conservation Reserve Program across the 50 states, along with 7.2 million acres of parts of productive land, and 6.4 million acres of grassland.

“Agricultural landowners with large land holdings, who value hunting, and have positive environmental values, attitudes, and behaviors, were more likely to participate” in at least one of the conservation programs, according to a survey of more than 2,500 landowners, including farmers and ranchers, in Minnesota, North Dakota and South Dakota, published in February 2019 in Land Use Policy.

Conservation benefits

Setting aside large parcels of land and allowing ecosystems to replenish can improve air and water quality, as well as increase biodiversity among animal species, research finds.

The authors of an October 2022 paper in Geohealth quantify the economic benefits of improved air quality from land set aside as part of the Conservation Reserve Program.

In examining 2,287 counties from 2001 to 2016, they find an inverse relationship between conservation enrollment and pollution: As the number of acres conserved goes up, fine particulate matter goes down.

They also estimate that across the counties studied, the farm bill’s conservation program avoided 1,353 deaths per year due to declining pollution. The authors estimate the dollar value of those deaths prevented at $9.5 billion.

“These findings provide evidence that CRP may generate economic gains in terms of avoided mortality, well above the cost of the program,” they write.

Likewise, the farm bill conservation program is associated with improved local water quality, according to an April 2021 study published in the International Journal of Applied Earth Observation and Geoinformation.

The authors studied conservation program enrollment and data on water nitrogen levels from 1999 to 2014 across nearly 18 million acres of the Illinois River Basin passing through Wisconsin, Indiana and Illinois. They link conservation program enrollment to lower nearby nitrogen levels along the Illinois River and offshoot streams.

“Most improvement can be associated with the CRP practices designed to improve water quality,” the authors write. “Nevertheless, it should be noted that the results indicate correlation but not necessarily causation, thus should be interpreted with caution.”

Numerous bird species, including the grasshopper sparrow, the thick billed longspur and short-eared owls, make grasslands their home. As grassland diminishes, populations of birds that prefer grasslands also decline, find the authors of a January 2022 study of the western Great Plains, published in Ecological Applications.

The authors of another study linking conservation efforts with maintaining biodiversity, published September 2021 in Rangeland Ecology & Management, note that after general conservation contracts expire, grassland contracts, which allow grazing, could be a viable way to preserve animal habitats while allowing land to be productive.

They write that “the vast majority of Great Plains grasslands are privately owned and managed by people who care deeply about conservation of the land but also need to make a living. Managers of private rangelands often acknowledge the importance of wildlife conservation but place this as a far lower priority than livestock production.”

Rental payments

The U.S. Department of Agriculture pays rent on conserved land for the contract term. Payments are made annually.

Rental rates vary by county. Rates are typically lower in states with less fertile land, such as Alaska, where the rate is $41 per acre on average for General CRP lands.

Rates are higher in midwestern states — known as America’s breadbasket, since historically that is where much of the country’s grain has been grown. Producers in Iowa, for example, can fetch $173 per acre, on average, for the general program.

The U.S. average is $78 per acre. Average rates vary by program component, in addition to by location — more information is available from the Farm Service Agency.

Rental rates can also change with each farm bill reauthorization. These rates are set as a percentage of the cash rental rate, which is the county average rent per acre a landowner could get if they rented to an agricultural producer. In the 2018 farm bill, the general conservation program rate was lowered from 110% of the cash rental rate to 85% — a reduction of 25 percentage points. The latest average cash rents by county are available from the National Agricultural Statistics Service.

Acreage caps

Farm bills cap the number of acres that can be included in conservation programs at any given time. Individual producers apply to have part or all of their land conserved.

While there is no limit to the number of acres an individual producer can apply for, no more than 27 million acres can be enrolled across the country, as of the most recent farm bill. For comparison, agricultural producers own about 900 million acres of land, according to the U.S. Department of Agriculture.

Federal legislators may raise or lower the cap during farm bill reauthorization. This was a point of debate in 2014, when that year’s farm bill reduced the cap from 32 million acres to 24 million acres, and in 2018, when the cap was raised to its current level.

Participation peaked in 2007 at nearly 37 million acres, according to research published in February 2020 in Applied Economic Perspectives and Policy.

“In no year has CRP met its farm bill acreage cap and acreage enrolled has fallen off significantly in recent years,” according to a March 2022 report from farmdocDaily, an online publication focusing on agricultural issues, published by the University of Illinois.

According to the January 2022 report from the Congressional Research Service, it is mostly a lack of federal dollars, not a lack of interest, that keeps producers from participating, particularly in the technical assistance programs.

Less than one-third of Environmental Quality Incentives Program applications were approved in 2021, compared with nine in ten general conservation program applications, the report finds.

“Arguments for expanding conservation programs in earlier farm bills were persuasive in light of evidence that large backlogs of interested and eligible producers were unable to enroll due to a lack of funds,” according to the report. “Debate on a new farm bill could see similar arguments.”

Conservation opportunity costs

Much of the research on the effectiveness of farm bill conservation programs focuses on outcomes and opportunity costs in specific states or groups of states in the especially fertile areas of the U.S. — primarily the Midwest.

Opportunity costs are what is given up when a choice is made. For agricultural producers, the cost of conservation is producing food for sale. The February 2020 paper in Applied Economic Perspectives and Policy explores opportunity costs in Kansas — specifically, whether conservation rental payments push land values up enough to counteract foregone crop sales, or whether the contracts hurt land values.

The authors analyze land parcel sales in the state spanning 1998 to 2014. They find sales of land with existing conservation contracts sell for 7% less on average than similar parcels without contracts. The buyer is discounted some money on the sale because they can’t farm it for a period of time.

The discount vanishes depending on years remaining on the contract and land quality.

“During years when it is likely a contract is up for renewal, parcels with CRP will sell with either no discount or a slight premium,” the authors write. “For land with relatively low productivity, as demonstrated by land sales in northwestern and north central Kansas, parcels with CRP sell with little to no discount.

Michigan State University agricultural economist Scott Swinton describes the conservation-versus-production decision making process in a November 2021 paper, also published in Applied Economic Perspectives and Policy:

“Farmers weigh two kinds of costs when deciding whether to participate in a conservation program. The first covers the direct costs of variable inputs and equipment. The second is the opportunity cost of giving up income from a current activity, such as crop production or live-stock grazing. Opportunity cost can be large, especially when shifting an entire field into a land retirement program.”

Because agricultural producers have more precise geospatial maps land than ever before, they may be able to fine-tune less productive parts of parcels set aside for conservation, Swinton suggests. There may also be opportunities for conservation within productive land, such as incorporating native plant life within crop fields, he adds.

“Looking ahead to the next Farm Bill in 2023, the public priorities, scientific evidence, and technological innovation point toward a role for precision conservation,” Swinton writes.

Source list

The Unintended Benefits of the Conservation Reserve Program for Air Quality
Douglas Becker, Alexander Maas, Jude Bayham and James Crooks. Geohealth, October 2022.

Mapping the Farm Bill: Reviewing the CRP; Law, Land & History
Jonathan Coppess and Christopher Laingen. farmdocDaily, March 2022.

Precision Conservation: Linking Set-Aside and Working Lands Policy
Scott Swinton. Applied Economic Perspectives and Policy, February 2022.

Farm Bill Primer: Conservation Title
Congressional Research Service, January 2022.

Increasing Durability of Voluntary Conservation through Strategic Implementation of the Conservation Reserve Program
Daniel Sullins, et al. Biological Conservation, July 2021.

Water Quality Related to Conservation Reserve Program and Cropland Areas: Evidence from Multi-Temporal Remote Sensing
Dameng Yin, et al. International Journal of Applied Earth Observation and Geoinformation, April 2021.

Thinking Like a Grassland: Challenges and Opportunities for Biodiversity Conservation in the Great Plains of North America
David Augustine, Ana Davidson, Kristin Dickinson and Bill Van Pelt. Rangeland Ecology & Management, September 2021.

The Opportunity Cost of the Conservation Reserve Program: A Kansas Land Example
Mykel Taylor, Nathan Hendricks, Gabriel Sampson and Dillon Garr. Applied Economic Perspectives and Policy, February 2020.

Further reading

Competing Farm Programs: Does the Introduction of a Risk Management Program Reduce the Enrollment in the Conservation Reserve Program?
Jisang Yu, Brittney Goodrich and Atticus Graven. Journal of the Agricultural and Applied Economics Association, September 2022.

Would Farmers Benefit from Removing More Land from Production in the Next Farm Bill?
Nathan Hendricks. Applied Economic Perspectives and Policy, March 2022.

Land Use Decisions after the Conservation Research Program: Re-enrollment, Reversion, and Persistence in the Southern Great Plains
Jessica Barnes. Conservation Science and Practice, July 2020.

Eastern Grasslands: Conservation Challenges and Opportunities on Private Lands
Patrick Keyser, et al. Wildlife Society Bulletin, September 2019.

Evaluating the Role of Farm Bill Conservation Program Participation in Conserving America’s Grasslands
Lily Sweikert and Larry Gigliotti. Land Use Policy, February 2019.

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