A Farm Bill for the Environment


Policymakers don't necessarily associate the farm bill with the environment. This year, however, they should be prepared to pass a bill that reflects the U.S. public's growing concern over global warming.

This increased concern, which can be attributed to an explosive increase in media coverage and a broad scientific consensus on humanity's contribution to climate change, has already generated significant discussion in key congressional committees and corporate boardrooms. Most importantly, it has generated discussion at the kitchen tables of voters, who increasingly demand that their representatives pass legislation to address their environmental concerns.

The farm bill is a multi-title bill, meaning that individual sections (titles) address different portions of the U.S. agricultural sector. These titles include commodity programs, conservation, agricultural trade and aid, nutrition programs, farm credit, rural development, research, forestry and energy.

Opportunities to enhance environmental benefits can be found under many titles of the bill, but some of the more significant lie within the conservation title --for things such as protection of wetlands, wildlife habitats, freshwater reserves and, potentially, the global climate system. These are in high demand, but are also drastically under-funded. In 2004 and 2005, farm bill conservation programs accounted for roughly 12 percent of total United States Department of Agriculture (USDA) support payments. By comparison, the share of USDA awards for support of commodities like wheat, corn and dairy was approximately 77 percent.

Conservation programs could play a pivotal role in the fight against global warming by potentially offering excellent opportunities for the U.S. agricultural sector to decrease greenhouse gas emissions. That is no small matter. The agricultural sector of the U.S. economy is responsible for 85 percent of total U.S. emissions of nitrous oxide and 32 percent of total U.S. methane emissions.

While they are emitted in lower quantities than carbon dioxide, the greenhouse gas responsible for most human-induced warming, these gases are far more potent. One ton of nitrous oxide, for example, warms as much as 310 tons of carbon dioxide does. Conservation practices such as no-till agriculture, manure management and general crop management can decrease these dangerous greenhouse gases, but only if the farm bill capitalizes on their ability to do so.

Policymakers can do four things to make conservation programs more able to combat global warming while benefiting farmers.

Increase the budgets of farm bill conservation programs. Due to the limited budget of conservation programs, many conservation title applicants are left out in the cold. The Environmental Quality Incentives Program (EQIP), for example, has only awarded grants to an average of 43 percent of applicants over the last several years. The same is true for other programs in the title. The Conservation Reserve Program did not even have a general signup period in 2005, and the Grassland Reserve Program, Wetland Reserve Program and Wildlife Habitat Incentives Program together only funded an average of 32 percent of total program applications in the same year.

Concentrate payments on environmental services instead of commodities. Environmental services are the benefits land can provide in addition to crop production, such as the inherent ability to clean our water and air through nutrient cycling and carbon dioxide storage.

There is virtually no potential for commodity support payments to benefit the environment, but the potential is great for conservation projects. By re-allocating funds from commodity to conservation programs, policymakers increase the incentive for farmers to implement projects that provide environmental services. Also, commodity payments are generally allocated according to historical market trends, while conservation program payments are awarded in advance for their anticipated services -- therefore, their environmental effectiveness has the potential to be assessed.

An example of an environmental service is a grant that establishes buffer strips along a streambed to filter nutrient runoff into the stream. This project promotes a vital environmental service by capitalizing on the filtering capacity of grasslands or shrubs. Further, the environmental benefits of this project can be assessed before it is awarded. This will only occur, however, if policymakers develop methods to measure the outcomes of an environmental service (using tools and methods explained in the final recommendation, below).

Concentrating on environmental services will be even more efficient and cost-effective if USDA programs "pay for performance." Conservation program applicants should demonstrate that their proposed practice offers the greatest environmental outcome for the least cost. Reverse auctions, for example, are one way to do this. In a reverse auction, sellers compete to supply buyers with a good or service, instead of buyers competing for a good or service offered by a seller.

This funding allocation method enrolls the largest number of farmers possible and maximizes environmental benefits. The federal government even has an in-house example to use for this method of award allocation -- in July 2006, a wetlands reserve program pilot used reverse auctions to reduce the acquisition costs of program easements. It was a huge success, enrolling 3,500 acres and reducing acquisition costs by 14 percent, or $820,000.

Broaden the scope of environmental services to include greenhouse gases and incorporate ways to lower them into the farm bill. Currently, methods to evaluate the environmental benefits of applications for conservation funding do not consider greenhouse gases. If they did, conservation programs could greatly contribute to efforts that reduce them from agricultural operations.

For example, a farmer in Texas could conceivably receive Conservation Security Program funding (another conservation title program) for planting wet rice on flooded fields. In his proposal, he could make the case that "artificial wetlands" increase wildlife diversity. However, this practice also increases methane -- a natural byproduct of plant decomposition that is not evaluated in the Farm Bill awards structure.

Take advantage of technological advancements. USDA agencies that award grants should develop ways of measuring the outcomes of an environmental practice. These methods should capitalize on the increasing access that farmers, agricultural consultants and county extension agents have to computer-based watershed models, GIS software and studies that analyze the efficiency of certain agricultural best management practices.

Quantifying the impacts of proposed practices will assure that grant applicants deliver environmental benefits, and better allow USDA program administrators to track and evaluate the effectiveness of their awards.

Taken together, these policy solutions will deliver a farm bill that helps farmers while addressing the U.S. public's environmental concerns.

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