[House Hearing, 111 Congress]
[From the U.S. Government Publishing Office]

HEARING TO REVIEW THE IMPLEMENTATION OF THE CONSERVATION TITLE OF THE
2008
FARM BILL

=======================================================================

HEARING

BEFORE THE

SUBCOMMITTEE ON CONSERVATION, CREDIT,
ENERGY, AND RESEARCH

OF THE

COMMITTEE ON AGRICULTURE
HOUSE OF REPRESENTATIVES

ONE HUNDRED ELEVENTH CONGRESS

FIRST SESSION

__________

OCTOBER 7, 2009

__________

Serial No. 111-31

Printed for the use of the Committee on Agriculture
agriculture.house.gov

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COMMITTEE ON AGRICULTURE

COLLIN C. PETERSON, Minnesota, Chairman

TIM HOLDEN, Pennsylvania, FRANK D. LUCAS, Oklahoma, Ranking
Vice Chairman Minority Member
MIKE McINTYRE, North Carolina BOB GOODLATTE, Virginia
LEONARD L. BOSWELL, Iowa JERRY MORAN, Kansas
JOE BACA, California TIMOTHY V. JOHNSON, Illinois
DENNIS A. CARDOZA, California SAM GRAVES, Missouri
DAVID SCOTT, Georgia MIKE ROGERS, Alabama
JIM MARSHALL, Georgia STEVE KING, Iowa
STEPHANIE HERSETH SANDLIN, South RANDY NEUGEBAUER, Texas
Dakota K. MICHAEL CONAWAY, Texas
HENRY CUELLAR, Texas JEFF FORTENBERRY, Nebraska
JIM COSTA, California JEAN SCHMIDT, Ohio
BRAD ELLSWORTH, Indiana ADRIAN SMITH, Nebraska
TIMOTHY J. WALZ, Minnesota ROBERT E. LATTA, Ohio
STEVE KAGEN, Wisconsin DAVID P. ROE, Tennessee
KURT SCHRADER, Oregon BLAINE LUETKEMEYER, Missouri
DEBORAH L. HALVORSON, Illinois GLENN THOMPSON, Pennsylvania
KATHLEEN A. DAHLKEMPER, BILL CASSIDY, Louisiana
Pennsylvania CYNTHIA M. LUMMIS, Wyoming
ERIC J.J. MASSA, New York
BOBBY BRIGHT, Alabama
BETSY MARKEY, Colorado
FRANK KRATOVIL, Jr., Maryland
MARK H. SCHAUER, Michigan
LARRY KISSELL, North Carolina
JOHN A. BOCCIERI, Ohio
SCOTT MURPHY, New York
EARL POMEROY, North Dakota
TRAVIS W. CHILDERS, Mississippi
WALT MINNICK, Idaho

______

Professional Staff

Robert L. Larew, Chief of Staff Nicole Scott, Minority Staff
Andrew W. Baker, Chief Counsel Director
April Slayton, Communications
Director

(ii)
?

Subcommittee on Conservation, Credit, Energy, and Research

TIM HOLDEN, Pennsylvania, Chairman

STEPHANIE HERSETH SANDLIN, South BOB GOODLATTE, Virginia, Ranking
Dakota Minority Member
DEBORAH L. HALVORSON, Illinois JERRY MORAN, Kansas
KATHLEEN A. DAHLKEMPER, SAM GRAVES, Missouri
Pennsylvania MIKE ROGERS, Alabama
BETSY MARKEY, Colorado STEVE KING, Iowa
MARK H. SCHAUER, Michigan RANDY NEUGEBAUER, Texas
LARRY KISSELL, North Carolina JEAN SCHMIDT, Ohio
JOHN A. BOCCIERI, Ohio ADRIAN SMITH, Nebraska
MIKE McINTYRE, North Carolina ROBERT E. LATTA, Ohio
JIM COSTA, California BLAINE LUETKEMEYER, Missouri
BRAD ELLSWORTH, Indiana GLENN THOMPSON, Pennsylvania
TIMOTHY J. WALZ, Minnesota BILL CASSIDY, Louisiana
ERIC J.J. MASSA, New York
BOBBY BRIGHT, Alabama
FRANK KRATOVIL, Jr., Maryland
SCOTT MURPHY, New York
WALT MINNICK, Idaho
EARL POMEROY, North Dakota

Nona Darrell, Subcommittee Staff Director

(iii)

C O N T E N T S

----------
Page
Goodlatte, Hon. Bob, a Representative in Congress from Virginia,
opening statement.............................................. 2
Holden, Hon. Tim, a Representative in Congress from Pennsylvania,
opening statement.............................................. 1
Submitted letters............................................ 61
Peterson, Hon. Collin C., a Representative in Congress from
Minnesota, prepared statement.................................. 3

Witnesses

Coppess, J.D., Jonathan W., Administrator, Farm Service Agency,
U.S. Department of Agriculture, Washington, D.C................ 3
Prepared statement........................................... 5
Submitted questions.......................................... 65
White, Dave, Chief, Natural Resources Conservation Service, U.S.
Department of Agriculture, Washington, D.C..................... 12
Prepared statement........................................... 13
Submitted questions.......................................... 72

HEARING TO REVIEW THE IMPLEMENTATION OF THE CONSERVATION TITLE OF THE
2008

FARM BILL

----------

WEDNESDAY, OCTOBER 7, 2009

House of Representatives,
Subcommittee on Conservation, Credit, Energy, and
Research,
Committee on Agriculture,
Washington, D.C.
The Subcommittee met, pursuant to call, at 10:05 a.m., in
Room 1300, Longworth House Office Building, Hon. Tim Holden
[Chairman of the Subcommittee] presiding.
Members present: Representatives Holden, Herseth Sandlin,
Markey, Schauer, Kissell, Boccieri, Costa, Ellsworth, Bright,
Murphy, Minnick, Pomeroy, Peterson (ex officio), Goodlatte,
Moran, Graves, Schmidt, Latta, Luetkemeyer, Thompson, and
Cassidy.
Staff present: Christy Birdsong, Claiborn Crain, Nona
Darrell, Adam Durand, John Konya, James Ryder, Anne Simmons,
April Slayton, Rebekah Solem, Patricia Barr, Tamara Hinton,
Josh Maxwell, Pelham Straughn, Jamie Mitchell, and Sangina
Wright.

OPENING STATEMENT OF HON. TIM HOLDEN, A REPRESENTATIVE IN
CONGRESS FROM PENNSYLVANIA

The Chairman. This hearing of the Subcommittee on
Conservation, Credit, Energy, and Research to review the
implementation of the Conservation Title of the 2008 Farm Bill
will come to order.
I would like to thank our witnesses and the audience for
coming to today's hearing.
This hearing presents an opportunity for Members of this
Subcommittee to review how the 2008 Farm Bill conservation
programs are being implemented. The farm bill made significant
changes to USDA conservation programs, and it is important that
we review the progress made so far to ensure that the rules and
regulations are following Congressional intent.
Conservation programs are important tools that farmers and
ranchers use to protect the environment and address local
resource concerns. Since 1985, we have sought to help producers
economically and proactively address resource concerns and
regulatory burdens. The steps we took in the 2008 Farm Bill
continued this tradition and included an historic increase in
funding for conservation programs.
Farmers and ranchers have always been the original stewards
of the land and continue to be the best advocates for resource
conservation. We have made great improvements and continue to
look for ways to help landowners participate in conservation
programs.
All our programs are important, but I would like to
highlight two which are popular in my home State of
Pennsylvania.
Pennsylvania is a national leader in farmland protection,
and it was critical that we improve the Farmland Protection
Program. A priority was decreasing the obstacles for producers
and making the program as user-friendly as possible. We were
also successful in doubling the funding level in this program.
We are committed to making sure that these changes are properly
implemented, and we will continue to closely watch as the Farm
and Ranch Lands Protection Program is rolled out.
Another program area of interest in my home state is the
Chesapeake Bay Program. We established this new program to help
restoration efforts in the Bay. Agriculture and USDA stand
ready to improve water quality and wildlife habitat in the
Chesapeake Bay, and I look forward to your comments on that
effort.
All our conservation programs are important to producers
across the country. Implementing the host of the 2008 Farm Bill
conservation programs in a swift and equitable manner is
critical, as farmers and ranchers across the country work to
produce the safest, most reliable source of food, fiber, and
energy, all while addressing different environmental
challenges.
I remain committed to working with NRCS and FSA to ensure
that the conservation programs are implemented as efficiently
as possible, while minimizing burdens on producers.
I look forward to hearing from our witnesses today, and
recognize the Ranking Member of the Subcommittee, Mr.
Goodlatte.

OPENING STATEMENT OF HON. BOB GOODLATTE, A REPRESENTATIVE IN
CONGRESS FROM VIRGINIA

Mr. Goodlatte. Well, thank you, Mr. Chairman. And thank you
for holding today's hearing to review the implementation of the
conservation programs in the 2008 Farm Bill.
Our farmers and ranchers, through the assistance and
incentives provided by these programs, have voluntarily worked
to help reduce soil erosion, increase wetlands, improve water
quality, and preserve farmland and wildlife habitat. The
environmental gains they have been able to achieve are a
testament to our producers, who are truly the most dedicated
conservationists.
Congress strengthened its commitment to conservation in the
2008 Farm Bill. The farm bill improved upon existing programs
by increasing funding to oversubscribed programs to address
backlogs, and by retooling programs to make them more producer-
friendly as well as available on a national basis.
The farm bill also created new conservation programs that
are aimed at enhancing cooperation and flexibility among
producers and conservation organizations in order to target
conservation initiatives such as the Chesapeake Bay initiative,
which is of great importance to the farmers and ranchers in
Virginia.
Virginia's forests are also of great importance to the
state and the nation's economy. Forest products, nationally,
are valued at over $22.5 billion annually. In the most recent
farm bill, we made great progress in both the conservation and
forestry titles to strengthen programs that helped forest
owners supply the nation's wood fiber, clean water, wildlife,
and other forest amenities.
CSP, now known as the Conservation Stewardship Program, had
implementation problems in the past, which resulted in limiting
access to the program to producers in select watersheds. NRCS
just completed the first sign-up under the new CSP, and I hope
today's testimony will shed light on whether Congress was able
to create a program that encourages additional conservation
practices on a national basis.
I thank Chairman Holden for holding this hearing. It is
vitally important for this Committee to hold the Department
accountable for the implementation of these critically
important programs. While I think the Department has done an
admirable job of getting the rules in place, I do have a number
of concerns, especially in certain circumstances where the
Department has ignored Congressional intent.
I would like to thank Chief White from the National
Resources Conservation Service and Mr. Jonathan Coppess,
Administrator of the Farm Service Agency, for being here today
to testify on the progress of implementing and managing the
conservation programs in the 2008 Farm Bill. And I look forward
to your testimony.
The Chairman. The chair thanks the gentleman and would ask
all other Members of the Subcommittee to submit their remarks
for the record.
[The prepared statement of Mr. Peterson follows:]

Prepared Statement of Hon. Collin C. Peterson, a Representative in
Congress from Minnesota

Thank you, Chairman Holden and Ranking Member Goodlatte for holding
this oversight hearing today. The 2008 Farm Bill added more than $4
billion in new spending to USDA's conservation programs. Mandatory
spending for conservation programs will be $55.2 billion over the next
10 years. That is a lot of money to manage, and it is our
responsibility to be sure that USDA is using that money effectively to
protect, improve and expand our nation's natural resources.
The 2008 Farm Bill included improvements to several conservation
programs and created new initiatives that USDA must implement. I am
particularly interested to hear about the progress being made to
implement the reforms we made to conservation programs, including new
payment limits for the conservation programs. I also hope our witnesses
can tell us what progress is being made to incorporate the changes we
made to the Conservation Reserve Program.
Today, we have Dave White with the Natural Resources Conservation
Service and Jonathan Coppess with the Farm Service Agency with us to
answer questions and provide an update on where USDA stands with
implementing the conservation title. Thank you both for being here
today, and I look forward to your testimony.

The Chairman. And we would now like to welcome our
witnesses: Mr. Jonathan Coppess, administrator, Farm Service
Agency, the United States Department of Agriculture; and Mr.
Dave White, chief, Natural Resources Conservation Service,
United States Department of Agriculture.
Mr. Coppess, you may begin when you are ready. Thank you.

STATEMENT OF JONATHAN W. COPPESS, J.D.,
ADMINISTRATOR, FARM SERVICE AGENCY, U.S.
DEPARTMENT OF AGRICULTURE, WASHINGTON, D.C.

Mr. Coppess. Thank you.
Mr. Chairman, Mr. Ranking Member, and Members of the
Subcommittee, I appreciate the opportunity to review
conservation programs administered by the Farm Service Agency.
Today I will update you on the implementation of our
conservation programs based on the 2008 Farm Bill.
In general, FSA delivers conservation, commodity, credit,
energy and disaster programs. We estimate about $13.6 billion
in net outlays for Fiscal Year 2009, including $2 billion for
conservation programs. Most FSA programs are delivered through
a network of 2,200 state and county offices.
The 2008 Farm Bill reauthorized three conservation programs
for FSA: the Conservation Reserve Program, the rental contracts
under the Grassland Reserve Program, and the Grassroots Source
Water Protection Program.
CRP conserves and improves soil, water, and wildlife
resources through 10 to 15 year contracts that provide annual
rental payments and cost-share assistance to farmers and
ranchers. Land enrolled in CRP reduces soil erosion and
provides habitat for wildlife.
The 2008 Farm Bill included several changes to CRP. The
most significant of those changes was a 32 million acre cap on
the aggregate U.S. acreage in the CRP that took effect on
October 1st. In an effort to continue environmental benefits on
the maximum CRP acres under this new 32 million acre cap, FSA
offered extensions in May to 1.5 million acres of the 3.9
million that were set to expire on September 30th. In recent
years, USDA has focused on this approach of selectively
offering extensions to maximize conservation benefits, allow
greater program flexibility, and spread out the overall county
office workload.
We start Fiscal Year 2010 with 31 million acres in the CRP.
Looking forward, contracts for about 15.4 million acres that
are currently enrolled in CRP are scheduled to expire between
Fiscal Years 2010 and 2012. However, utilizing a combination of
general sign-ups and ongoing continuous sign-ups, we expect to
maintain CRP enrollment at or near that 32 million acre cap.
In August 2008, FSA, in consultation with the Office of the
Chief Economist, the Office of General Counsel, and U.S.
Department of Justice, made the decision to divide
implementation of the CRP changes from the 2008 Farm Bill into
two regulations: those that require an environmental impact
statement and those requiring only an environmental assessment.
The EIS process takes about 18 to 24 months, and the EA
process, environmental assessment process, involving less
scrutiny, takes between 9 and 12 months.
On June 29, 2009, we issued the first rule, implementing
the aforementioned changes that required only the environmental
assessment. Enrollment for these new practices started in
August of 2009. The second part of the CRP regulation, or the
second regulation, implements those remaining provisions
requiring an EIS. We are currently holding public meetings
nationwide, and those will conclude October 9th. The EIS will
then be completed in the summer of 2010. We will publish the
rule for the rest of the CRP immediately thereafter, and thus
implementing all changes from the 2008 Farm Bill.
The Grassland Reserve Program is a voluntary conservation
program that emphasizes support for grazing operations and
protects grassland under threat of conversion to other uses.
Under this program, farmers and ranchers have a choice between
receiving a permanent easement or long-term rental contracts.
GRP is split between FSA and NRCS, with FSA implementing the
rental contracts portion and NRCS implementing the easements
portion of that program. The GRP provisions of the 2008 Farm
Bill have been fully implemented.
Under the Grassroots Source Water Protection Program, FSA
works with state rural water associations in 43 states to aid
in the prevention of source water pollution. Source water--this
program is authorized for up to $20 million in appropriations
by the 2008 Farm Bill. In Fiscal Year 2009, source water was
expanded from 38 to 43 states, and the program completed 112
source water plans, with management activities implemented in
the source water areas.
The 2008 Farm Bill also authorized a new Voluntary Public
Access and Habitat Incentive Program. This program will provide
grants to states and tribes to encourage farmers and ranchers
to make their private land available for access by the public.
Full implementation of the Voluntary Public Access Program has
been expedited, and we expect to implement the program in the
next several months.
We will also continue to seek ways in which FSA can work
alongside NRCS and other USDA agencies, other Federal agencies,
and state and local authorities in order to implement
conservation programs and improve conservation in general.
Finally, if I can provide a brief update on the CRP payment
process that was not in the written testimony that we just got
information on recently in the last day or two, this past
weekend FSA's IT department processed about 827,000 CRP
payments, totaling about $1.4 billion. Processing through our
computer system is the first step in making the payments
available by the field offices, which are also following up on
a few additional ones that we have to get through the process.
As of yesterday, field offices had signed and approved over
600,000 of these payments, and the Department of Treasury has
issued over 400,000 payments to producers, totaling over $660
million. We should have this process completed by the end of
the week and all payments out.
So let me conclude by stating that implementation of the
2008 Farm Bill is a priority of FSA and this Administration. We
will continue to work hard every day to ensure program delivery
is done right and completed as soon as possible.
So I appreciate the opportunity to testify before this
Subcommittee today, and I look forward to working with you, Mr.
Chairman and Mr. Ranking Member, and all the Members of the
Subcommittee as we continue our hard work to ensure that USDA
is responsive to the needs of American agriculture.
This concludes my oral statement. I will be glad to answer
any questions that you might have. Thank you.
[The prepared statement of Mr. Coppess follows:]

Prepared Statement of Jonathan W. Coppess, J.D., Administrator, Farm
Service Agency, U.S. Department of Agriculture, Washington, D.C.

Mr. Chairman, Mr. Ranking Member, and Members of the Subcommittee,
I appreciate the opportunity to review conservation programs delivered
by the Farm Service Agency (FSA). Today I will provide you with a
status update on implementation of our conservation programs, focusing
on the 2008 Farm Bill. I will also describe how we work with state and
local governments and our sister agencies, discuss our accomplishments
to date, and conclude by discussing the future of our programs.

FSA's Conservation Programs
FSA delivers conservation, commodity, credit, energy, and emergency
disaster programs. Program level funding varies depending upon market
and weather conditions as well as new legislation. For Fiscal Years
(FY) 2007 and 2008, net spending was $11.0 billion and $11.4 billion,
respectively. We estimate the level to be $13.6 billion for FY 2009,
including nearly $2.0 billion for conservation programs. Most FSA
programs are delivered through a network of state and county offices
that are located in over 2,200 rural counties.
The 2008 Farm Bill re-authorized three FSA-administered
conservation programs: the Conservation Reserve Program (CRP), the
rental contracts under the Grassland Reserve Program (GRP), and the
Grassroots Source Water Protection Program. CRP conserves and improves
soil, water and wildlife resources through 10-15 year contracts that
provide annual rental payments and cost-share assistance to farmers and
ranchers. This program has been in effect since 1985, and as of October
1, 2009, has 31 million acres under contract.
GRP is a voluntary conservation program that emphasizes support for
grazing operations and protects grassland under threat of conversion to
other uses. Under this program, farmers and ranchers have a choice
between receiving a permanent easement or long-term rental contracts.
It is jointly implemented by FSA and the Natural Resources Conservation
Service (NRCS), with FSA implementing the rental contracts portion and
NRCS implementing the easement portion. As of June 30, 2009, a total of
662,217 acres were enrolled in the rental portion of GRP.
The Grassroots Source Water Protection Program is the smallest of
these three programs, and uses on-site technical assistance
capabilities of state rural water associations to prevent source water
pollution. Collaborative teams create operating plans that identify
priority areas where local pollution prevention efforts are most
needed, and work to develop voluntary measures that producers can
install. These voluntary measures range from producers storing
herbicides and pesticides in more secure containers to relocating waste
lagoons. Currently, 43 states participate in this program.
FSA also is in the process of implementing the Voluntary Public
Access and Habitat Incentive Program (Public Access Program), which was
newly authorized in the 2008 Farm Bill. This program provides grants to
states and Tribes to encourage farmers and ranchers to make private
land available for access by the public to engage in wildlife-dependent
recreation, including hunting and fishing. We are also implementing
farm bill programs authorized under non-conservation titles, but with
potential conservation value. Namely, these include the newly-
authorized Emergency Forest Restoration Program (EFRP) under the
Forestry Title and the Conservation Loan Guarantee Program of the
Credit Title, which I will briefly discuss later.
In addition to these programs that appear in the 2008 Farm Bill,
FSA administers the Emergency Conservation Program (ECP). ECP provides
emergency funding and technical assistance for farmers and ranchers to
rehabilitate farmland damaged by natural disasters and for carrying out
emergency water conservation measures in periods of severe drought.
Funding for ECP is appropriated by Congress. Locally-elected county
committees are authorized to implement ECP for all disasters except
drought, which is authorized at the national office of FSA.

Background on Recent Program Directions and Implementation of
Conservation Title Provisions in the 2008 Farm Bill
The 2008 Farm Bill included several changes to CRP. The most
significant of these changes was a 32 million acre cap on aggregate
U.S. acreage in the CRP, which took effect last week, on October 1,
2009. Other major changes include expanding Farmable Wetland Program
(FWP) eligibility, exempting Conservation Reserve Enhancement Program
(CREP) and continuous CRP acres from the county enrollment cap of 25
percent of cropland if the county government concurs, and implementing
the new transition incentives for beginning and socially disadvantaged
farmers and ranchers programs. This new transition incentives program
allows participants to initiate the organic certification process and
to make conservation and land improvements before CRP contract
expiration if the enrolled land is sold or transferred to a beginning
or socially disadvantaged farmer or rancher.
In an effort to continue environmental benefits on the maximum CRP
acres under the new 32 million acre cap, FSA offered extensions in May
2009 to 1.5 million acres of the 3.9 million set to expire on September
30, 2009. These extensions were offered on those acres with the highest
environmental benefit--those that fall within the top 30 percent of the
environmental benefits index, or have an Erodibility Index of 15 or
greater. As of September 29, participants holding contracts on 985,527
acres have accepted this extension offer. We expect this number to
increase as county offices update data. Slightly fewer than 3 million
acres did not receive an extension offer, or the participants declined
the offer they received, and those contracts expired on September 30,
2009.
In recent years, USDA has focused on this approach of selectively
offering extensions (and, upon occasion, re-enrollments) to maximize
conservation benefits and spread out the associated county office
workload (see figures 1 and 2 for a historical perspective on
continuous versus general sign-up contracts and enrollment). For
example, faced with 16 million acres set to expire on September 30,
2007, and an additional 12 million acres set to expire through 2010,
USDA used re-enrollments and staggered contract extensions to spread
the expirations out over a longer time period. This approach allows
greater flexibility in determining the future of the program and
spreads out the workload for our county offices and technical service
providers (in particular, the Natural Resources Conservation Service).
The last time that USDA had a general sign-up was in 2006.
We start Fiscal Year 2010 with 31 million acres in the CRP--about
2.6 million fewer acres than a year ago. With declining commodity
prices for wheat, corn, soybeans and other crops since the highs of
2007 and 2008, interest in CRP enrollment is again accelerating.
Looking forward, contracts for about 15.3 million acres currently
enrolled in CRP are scheduled to expire between Fiscal Years 2010 and
2012. The President's budget for Fiscal Year 2010 assumes that general
sign-ups will be conducted in Fiscal Years 2010-2012. The combination
of general sign-ups and ongoing continuous sign-ups are expected to
maintain CRP enrollment at, or near, 32 million acres through 2012.
Various continuous sign-up opportunities exist under the CRP,
including the State Acres for Wildlife Enhancement (SAFE) program, new
conservation initiatives, and various Conservation Reserve Enhancement
Program (CREP) projects. These practices generally target smaller
parcels of some of the most environmentally fragile land. However,
acres in these continuous sign-up practices, added together with
general sign-up acres, must total to no more than 32 million acres at
any point in time.
I'd like to provide a bit more on how these continuous programs
operate. SAFE includes 84 approved projects in 33 states that help
restore habitat to benefit a wide range of priority wildlife species,
many of which are of great conservation concern due to significant
population declines. One of our most successful SAFE projects is the
South Dakota Pheasants SAFE, which initially targeted enrollment of
20,200 acres. Its goal is to provide habitat for non-game grassland
birds, improve water quality, and reduce soil erosion, as well as
increase the overall populations of ring-necked pheasants and other
economically significant species, such as sharp-tailed grouse, prairie-
chicken, and upland nesting ducks. This SAFE project started in 2008,
and reached its enrollment limit within a month; an additional 30,000
acres were added to this SAFE project in 2009.
CREP is a voluntary land retirement program that helps agricultural
producers protect environmentally sensitive land, decrease erosion,
restore wildlife habitat, and safeguard ground and surface water. A
specific CREP project begins when a state, Indian tribe, local
government, or local nongovernment entity identifies an agriculture-
related environmental issue of state or national significance. These
parties and FSA then develop a project proposal to address particular
environmental issues and goals. CREP contracts require a 10 to 15 year
commitment to keep lands out of production, in return for an annual
rental payment and cost-share assistance, and offer additional
financial assistance. The Iowa CREP, which I will discuss in a few
minutes, is one of our most far reaching and holds promise as a model
for CREPs in other states.
This background on the CRP provides the context for our
implementation of the 2008 Farm Bill. In an effort to implement program
changes as quickly as possible, FSA divided CRP-related changes into
two regulations: those that required an Environmental Impact Statement
(EIS), and those that required only an Environmental Assessment. EIS
process generally takes approximately 18-24 months, while an EA can be
done within 9-12 months after funding is available. Both the EIS and
EA, to greater and lesser extents respectively, discuss the change and
alternative courses of action; the environmental impacts of the
proposed action and alternatives; and a listing of agencies and persons
consulted.
On June 29, 2009, we issued a rule implementing all changes
associated with the second category, those that fell under the EA-
associated changes. These include changes to the Farmable Wetlands
Program (FWP), which is a voluntary program under the CRP to restore up
to 1 million acres of farmable wetlands and associated buffers by
improving the land's hydrology and vegetation. Producers plant long-
term, resource-conserving covers to improve the quality of water,
control soil erosion, and enhance wildlife habitat. In return, FSA
provides FWP participants with rental payments, incentive payments, and
cost-share assistance. Contract duration is between 10 and 15 years.
The 2008 Farm Bill adds three new FWP practices to this existing
program: eligibility for commercial pond-raised aquaculture, flooded
prairie farmland, and constructed wetlands. Enrollment for these new
practices started in August 2009. To date, we have enrolled 596 acres
under the Aquaculture Wetland Restoration practice, and 75 acres under
the Flooded Prairie Wetland practice.
In addition to the FWP, the farm bill provided $50 million cost-
share assistance for tree thinning, which helps develop a stronger
stand and provides wildlife and other natural resource benefits;
refines income limits for program eligibility; and imposes the 32
million acre cap. All of these changes are included in the June 29
regulation.
The ``part two'' CRP regulation will implement those provisions
that require an EIS. These provisions include: updating crop history
eligibility to include 4 of the last 6 years between 2002 and 2007;
exempting certain Conservation Reserve Enhancement Program (CREP) and
continuous CRP acres from the county enrollment cap of 25 percent of
cropland; implementing the new transition incentives for beginning, and
socially disadvantaged, farmers and ranchers programs; and routine
grazing. We are currently holding public meetings nationwide as a first
step toward completion of the EIS; they are scheduled to conclude on
October 9, 2009. The EIS will be completed in the summer of 2010. We
are planning to initiate these changes as soon as the EIS and
regulation is completed.
The Public Access Program will provide grants to state and Tribal
governments to expand public access opportunities on private lands. As
such, it will provide greater public access for outdoor recreation
activities, including hunting. FSA has begun developing the regulations
and plans to implement the program during 2010.
Work With State, Local, and Interagency Partners
All of FSA's conservation programs have a strong state-local
partnership aspect, as I alluded to earlier. For example, our CREP
programs are all designed through interaction among state and Federal
agencies and conservation partners. The Iowa CREP is a good
illustration of a program, designed with various Iowa State and local
partners, to address use of the CRP to reduce nutrient loading in the
Mississippi River watershed and hypoxia issues associated with the Gulf
of Mexico. We are actively working with other states--including
Minnesota, Wisconsin, Illinois, Missouri, Arkansas, Kentucky,
Louisiana, Indiana, Iowa, Mississippi, Ohio, and Tennessee--to expand
the Iowa CREP concept, through the new constructed wetland practice
under the FWP, to other watersheds. We have recently been interacting
with NRCS about use of constructed wetland catchments to further our
joint goals associated with improving the health of the nation's
rivers.
In developing the SAFE program for South Dakota that I described
earlier, we worked with both the state government and various
conservation groups to develop a successful program facilitating
enrollment of land for pheasant hunting. We are entertaining proposals
to address at-risk species, such as lesser prairie chicken habitat in
Colorado, Oklahoma, New Mexico, Texas, and Kansas. We are working
across states and interest groups to facilitate enrollment in the
longleaf pine initiative, which establishes incentives for landowners
to restore longleaf pine habitat under continuous sign-up. Our upland
buffer practice (CP33) has been so successful that FSA is exploring
options to expand this initiative.
Virtually all of our programs involve coordination with our sister
agencies, such as the NRCS, Forest Service, and Fish and Wildlife
Service. NRCS not only helps producers develop conservation plans for
producers desiring to enroll in the CRP, but works with us on many
state and local issues. We are working with the Fish and Wildlife
Service to address concerns about habitat for the lesser prairie
chicken and other at-risk species. We are working with land grant
universities and the U.S. Geologic Survey to monitor water quality and
quantity, both in the Ogallala Aquifer and the Mississippi River Basin.
We're working with the Forest Service on bottomland hardwood issues to
ensure that producers are using good forestry techniques to establish
systems that maximize carbon sequestration and wildlife habitat.

Implementation of Cross-Cutting Programs
In addition to the cross-agency work we do on the conservation
front, we find that our programs are increasingly cross-cutting in
terms of their direction and underlying aims. Our most recent
accomplishment in this area involves the Biomass Crop Assistance
Program (BCAP). On May 5, 2009, the President issued a directive to
aggressively accelerate the investment in and production of biofuels.
In early June, FSA issued a Notice of Funds Availability for BCAP,
meeting the 30 day deadline established by the President. BCAP
accelerates investment in the production of biofuels, while promoting
conservation principles. BCAP has two components. The first provides
matching payments to eligible land owners and operators for eligible
material that is sold to a qualified biomass conversion facility for
the production of heat, power, bio-based products or advanced biofuels.
The second component provides funding for producers of eligible crops
of renewable biomass within specified project areas to receive
establishment and annual payments.
Interest in BCAP matching payments has been strong. Fifty
facilities have been qualified as Biomass Conversion Facilities. These
facilities range from a small rural school in Northwestern Montana that
uses downed timber and wood residue to provide energy for boilers, to
pelletizers that generate fuel for public utility companies. Twenty-
five million dollars in funding was made available for matching
payments in FY 2009. The first matching payment was issued to a
Missouri producer on August 31, 2009.
FSA is also developing a regulation to implement the Emergency
Forest Restoration Program (EFRP) under the Forestry Title of the 2008
Farm Bill. We are working together with the Forest Service and NRCS on
this program, which provides financial assistance to owners of non-
industrial private forest land (rural land with existing tree cover)
for measures undertaken to address damage caused by a natural disaster.
Another cross-cutting program is the Conservation Loan Guarantee
Program of the Credit Title. This new program helps finance qualifying
conservation projects. Based on the statute, all guarantees will be at
75 percent of the loan amount. Applicants must have an acceptable
conservation plan that includes the project(s) to be financed.
Preference under this program is given to beginning farmer and socially
disadvantaged applicants, conversion to sustainable or organic
production practices, and compliance with highly erodible land
conservation requirements. We anticipate publication of this regulation
in the next several months.

Program Accomplishments
USDA conservation programs have had a tremendous beneficial impact
upon our nation's land and natural resources. According to the National
Resources Inventory, between 1982 and 2003, soil erosion on U.S.
cropland decreased 43 percent. Water (sheet & rill) erosion on cropland
in 2003 was down from 1.67 billion tons to 971 million tons per year,
and erosion due to wind was down from 1.39 billion tons to 776 million
tons per year. About \1/3\ of the total reduction is attributable to
CRP.
As of September 2009, CRP participants have restored more than 2
million acres of wetlands and 2 million acres of riparian buffers. Land
enrolled in CRP intercepts or reduces the amount of pollutants leaving
the field. Using models developed by the Food and Policy Research
Institute (FAPRI), these annual reductions include 221 million tons of
sediment, 615 million pounds of nitrogen, and 123 million pounds of
phosphorus. CRP is the nation's largest carbon sequestration program on
private lands. In 2008, CRP reduced greenhouse gas emissions by an
estimated 56 million metric tons. These reductions do not account for
potential leakage of agricultural production to non-enrolled lands.
Grass, trees, and wetlands established by CRP benefit numerous
wildlife species. Several independent studies have identified benefits
to bird populations, including:

Prairie Pothole Ducks--Researchers from the U.S. Fish and
Wildlife Service estimate that the CRP contributed to a net
increase of about 2 million additional ducks per year (a 30
percent increase in duck production since 1992) in North
Dakota, South Dakota, and Northeastern Montana.

Ring-Neck Pheasants--Western Ecosystems Technology, Inc. in
a peer reviewed study found that, in prime pheasant habitat, a
four percent increase in CRP herbaceous vegetations was
associated with a 22 percent increase in pheasant counts.

Sage Grouse--The Washington Department of Natural Resources
found CRP enrollment was associated with halting a decline (25
percent between 1970 and 1988) in sage grouse populations.

An increasingly important component of CRP is continuous sign-up,
which includes SAFE, CREPs, and the FWP. As of August 2009, there were
about 4.4 million acres enrolled in continuous sign-up. These lands
have an important CRP contribution. Land in grass filters and riparian
buffers (partial field enrollments) intercept sediment, nutrients and
other contaminants before they enter waterways. Based on models from a
peer reviewed study, FSA estimated 343 million pounds of nitrogen (56
percent of total N reductions) and 70 million pounds of phosphorus (57
percent of total P reductions) were intercepted by CRP buffers in 2008.
Conclusion
Conservation programs have provided notable achievements in both
conserving and protecting our natural resources. The Farm Service
Agency will continue to work diligently toward the implementation of
all 2008 Farm Bill provisions, including the Conservation Title
provisions I have discussed with you today.
I appreciate the opportunity to testify before this Subcommittee
today, and I look forward to working with you, Mr. Chairman, Mr.
Ranking Member, and all the Members of this Subcommittee as we continue
our hard work to ensure that USDA is responsive to the needs of
American agriculture. This concludes my statement. I will be glad to
answer questions you may have.

Attachment
Figure 1: ``CRP Enrollment at End of Each Fiscal Year (Acres)''

[GRAPHIC] [TIFF OMITTED] T1131.001

Figure 2: ``CRP Contracts at End of Each Fiscal Year (Number)''

[GRAPHIC] [TIFF OMITTED] T1131.002

The Chairman. Thank you, Mr. Coppess.
Chief White?

STATEMENT OF DAVE WHITE, CHIEF, NATURAL RESOURCES CONSERVATION
SERVICE, U.S. DEPARTMENT OF
AGRICULTURE, WASHINGTON, D.C.

Mr. White. Good morning, Mr. Chairman, Mr. Ranking Member,
Members of the Subcommittee.
When I woke up this morning, the first thing that went
through my head was the 23rd Psalm, ``Yea, though I walk
through the valley of . . .'' I think to myself, ``God, I hope
it is not a premonition.'' But it is a pleasure to be here with
you today and visit with you about what we have done with the
2008 Farm Bill.
The conservation title has kept us busy. I am happy to
report that we have successfully implemented the new programs.
Mr. Goodlatte mentioned the Conservation Stewardship Program.
We have made the required changes to the existing programs. And
we have also done some stuff internally that I am going to
share with you that I think is going to really help the quality
of our delivery, and some internal processes that are going to
increase our efficiencies.
With respect to the rules and regs, they are all out. I did
make several amendments to rules that were published--interim
final rules that were published just prior to the end of the
previous Administration. And it directly relates to Mr.
Goodlatte's concern about Congressional intent. Specifically,
the Farm and Ranch Lands Protection Program and Grassland
Reserve Program, we pulled that back, particularly over the
contingent right of enforcement.
This Committee, the Senate, the conference committee, spent
a lot of time trying to figure out what to do with this
contingent right of enforcement. And I am happy to say that we
have it changed where the acquisition, when we entered into
easements, through the Farm and Ranch Lands Protection Program,
it does not constitute the Federal acquisition of a Federal
property right, which directly relates to the Congressional
intent of this Subcommittee.
We made some changes in the Wetland Reserve Program:
eliminated some of the provisions that I thought were
overreaching into private properly rights, and restoring the
relationship we used to have with clients.
Moving from the rules--there are other rule amendment
examples, too, like EQIP and WHIP, and I can visit with you on
those.
Moving to implementation, let's talk a little bit about the
Conservation Stewardship Program. Mr. Goodlatte is dead-on. We
did have implementation problems with that. We had an IG
report. I think I visited with this Subcommittee previously on
that.
The new program, the answer to your question, Mr.
Goodlatte, is, yes, Congress did make a lot of changes in that,
and they have resulted in a program that is much more
efficient. It is better. It is going to be simpler to
administer, and it is going to be fairer to our producers.
We had the first sign-up; it went from August 10th through
September 30th. Started out slow; the end of it, it just
exploded with interest. We have 21,000+ applications, and
estimating right now that that would cover about 33 million
acres, and that is absolutely huge. We can enroll up to 12.8
million acres.
To tell you the truth, in 2009 we thought the demand would
go down for conservation programs because of the overall
economic climate, and it didn't. Most programs saw an increase
in applications.
Last year wasn't without its challenges, though. There was
a delay in getting the online adjusted gross income database,
which is what we use to make sure we don't pay somebody who
doesn't meet the AGI requirements. That is resolved now. We did
some work-arounds in the summer. We now have the database. Our
people are plugging it in. Everything should be fine. And it
won't be an issue, certainly after November.
I want to talk to you a little bit about some of the
internal stuff. And there is one thing that I think is going to
knock your socks off. We have a Conservation Streamlining
Initiative. And, Members of this Subcommittee, when we get done
with this darn thing, we think that we can eliminate 80 percent
of the clerical and administrative tasks that our staff
currently perform for these farm bill programs. And we think
that we can enable our field staff to spend 75 percent of their
time in the field with farmers and ranchers instead of sitting
behind a computer entering soil data or stuff like that. This
is huge. It would just help us so much and mean so much more to
the field to be able to get out there. Think about 80 percent--
and I think we can pull it off, and I am committed to pulling
it off.
We also talked about critical resource concerns, about
taking some of these programs--you have given us the tools, you
have given us the resources to go after some of these bigger
issues. And, frankly, we are using the Chesapeake Bay as a
model, on how you guys designed that. And we have just
announced one last week or 2 weeks ago, whatever it was, on the
Mississippi Basin. We are thinking about doing stuff in the
Ogallala. We are thinking about doing stuff out West for the
sage grouse.
I think it is time that Agriculture start setting the
conservation agenda. We have the tools, we have the money, we
have the will for us to set the agenda, rather than let other
folks set it and we would be reacting to it.
That concludes my oral statement. I am happy to be here. I
would be pleased to answer any questions, Mr. Chairman. Thank
you.
[The prepared statement of Mr. White follows:]

Prepared Statement of Dave White, Chief, Natural Resources Conservation
Service, U.S. Department of Agriculture, Washington, D.C.

Mr. Chairman and Members of the Subcommittee, thank you for the
opportunity to appear before you today to share our experiences in
implementing the Conservation Title of the Food, Conservation, and
Energy Act of 2008 (Farm Bill). Many observers describe the 2008 Farm
Bill as an evolutionary farm bill, incorporating important
modifications and improvements over the previous farm bill but not
containing revolutionary changes or new approaches. In the Conservation
Title, we had plenty of new things to keep us busy over the past year.
The 2008 Farm Bill provided $4.2 billion in new funding for
conservation programs over the life of the farm bill. Over \2/3\ of
NRCS's annual budget is now mandatory funding, authorized in the farm
bill. The bill authorized new programs such as the Conservation
Stewardship Program, the Agricultural Water Enhancement Program, and
the Chesapeake Bay Watershed Program. It introduced air quality and
organic agriculture components to the Environmental Quality Incentives
Program, and made significant operational changes to the Wetlands
Reserve Program, the Farm and Ranch Lands Protection Program, and the
Cooperative Conservation Partnership Initiative. It also brought the
Agricultural Management Assistance Program under the payment
eligibility auspices of the farm bill.
As we reflect back on the fiscal year that just ended last week, I
am happy to report that NRCS has successfully launched the new programs
and implemented the changes to existing programs in the 2008 Farm Bill.
We faced obstacles along the way, particularly with changes to the
adjusted gross income payment limitation that led to deleterious delays
in obligating funding.
Nevertheless, as of September 30, 2009, we obligated 96.3% of the
mandatory farm bill funding available for our programs in Fiscal Year
2009. We are also working on finalizing regulations for all farm bill
programs. And we launched some initiatives that will improve the
agency's capacity going forward, including a renewed focus on the field
and an administrative streamlining effort. We also are completing a
workforce planning effort to ensure that we have the right people in
the right places to optimally serve our customers. We are also
initiating new watershed-based conservation efforts in the Chesapeake
Bay and Mississippi River basins.
I will go into more detail about our progress in publishing
regulations for our farm bill programs. Then I will update where we
stand on actual implementation of the programs, before closing with
some more about the challenges and opportunities I just mentioned.

Farm Bill Implementation--Regulatory Actions
Just prior to the end of the Bush Administration, NRCS published a
number of regulatory documents, updating program rules based on changes
in the 2008 Farm Bill. These interim final rules enabled NRCS to
implement the programs authorized by the 2008 Farm Bill in Fiscal Year
2009. Appendix One is a list of all farm bill regulatory documents
published prior to January 20, 2009.
With the change in Administrations, NRCS re-evaluated the published
regulations to assess whether the policies were consistent with the
Obama Administration's approach to voluntary conservation program
delivery. Although NRCS determined it was not necessary to withdraw any
of the regulations, we did decide it was necessary to issue critical
amendments to several of the interim final rules for financial
assistance programs and conservation easement administration.
Our changes restored the appropriate relationship that NRCS has
with its partnering entities and with participating landowners and
operators. Since the changes addressed the programs' fundamental
relationship structure, we determined that these amendments could not
wait until we had comprehensively reviewed and responded to public
comment in the development of the final rules. The following is a
description of the critical amendments:

Amendments to both the Farm and Ranch Lands Protection
Program (FRPP) and the Grasslands Reserve Program (GRP) interim
final rules clarified that the contingent right of enforcement,
a new right created by changes in the farm bill, did not
trigger Federal real property acquisition requirements. In the
original interim final rules for these programs, NRCS held that
the contingent right of enforcement triggered Federal real
property acquisition requirements, such as the Department of
Justice title standards. This interpretation appeared counter
to the financial assistance relationship intended by Congress
when NRCS contributes funds towards the purchase of an easement
to be held by a non-Federal entity.

A June 2009 amendment to the Wetlands Reserve Program (WRP)
interim final rule re-established the operational relationship
between NRCS and its clients. The January interim final rule
introduced several overly burdensome responsibilities upon
landowners and hindered the agency's ability to complete
restoration activities on all its easement lands. In
particular, the rule placed responsibility for full wetlands
restoration on the landowner and considered a landowner in
violation if the property was transferred to a new landowner
prior to completion of the restoration activities. These new
provisions were not necessitated by the 2008 Farm Bill and
created a tone counter to the assistance nature of the program.
The June amendment to the interim final rule reaffirmed NRCS's
commitment to ensuring that all lands enrolled in WRP are
restored and protected for the duration of the easement period.

Amendments that adjusted the land eligibility criteria for
both the Environmental Quality Incentives Program (EQIP) and
the Wildlife Habitat Incentive Program (WHIP) were issued after
we determined that the interim final rules unnecessarily
restricted landowners and operators from obtaining assistance
on their entire operation. These restrictions were preferences
of the previous Administration and not required by the 2008
Farm Bill. The EQIP amendment published in May 2009 re-
established policy to enable producers who lease public lands
to use EQIP funds on their whole operation. The WHIP amendment
published in July 2009 expanded the definition of agricultural
lands to enable participants to obtain WHIP funding on
agricultural production lands and on those lands capable of
being used for production. The WHIP interim final rule had
limited the use of funds just to lands in agricultural
production.

Appendix Two is a complete list and description of regulatory
documents published since January 20, 2009. With the publication of
each of these amendments, NRCS requested new public comment on the
interim final rules. We have been collecting and analyzing the comments
not just for the amended rules but for all of the interim final rules
published for our farm bill programs. Appendix Three is a schedule for
completion of the final rules for all of the programs.
2008 Farm Bill Conservation Program Implementation
NRCS offers programs that provide financial and technical
assistance to eligible producers for implementation of approved
conservation practices and enhancements on private agricultural lands,
non-industrial forestlands, and tribal lands. Financial assistance
programs include: the Environmental Quality Incentives Program, the
Wildlife Habitat Incentive Program, the Agricultural Management
Assistance (AMA) Program, the Conservation Security Program (CSP), and
the Conservation Stewardship Program. Efforts authorized as part of
EQIP include: Conservation Innovation Grants (CIG), the Cooperative
Conservation Partnership Initiative (CCPI), the Agricultural Water
Enhancement Program (AWEP), the Organic Program Initiative, and the Air
Quality Initiative.
Beyond financial assistance programs, the 2008 Farm Bill maintained
easement programs as a key component of NRCS's portfolio of
conservation programs. NRCS's easement programs are: the Farm and Ranch
Lands Protection Program (FRPP), the Grassland Reserve Program (GRP),
the Wetland Reserve Program (WRP), the Wetland Reserve Enhancement
Program (WREP) and the Healthy Forests Reserve Program (HFRP).
A number of the financial assistance programs and initiatives
listed above were new in the 2008 Farm Bill, including the Conservation
Stewardship Program, CCPI, AWEP, the Chesapeake Bay Watershed Program,
HFRP, the Organic Program Initiative, and the Air Quality Initiative.
These new efforts drew impressive producer interest and application
numbers. We also used EQIP and AWEP authority to offer another new
initiative--funding for the construction of ring dikes in Minnesota and
North Dakota. Ring dikes constructed around farm operations greatly
improve water quality by avoiding the runoff of agricultural waste and
chemicals into watersheds in flood prone areas.
The 2008 Farm Bill authorized the new Conservation Stewardship
Program, an update on the old Conservation Security Program. The 2008
Farm Bill made a number of improvements to the old program that will
expand the program's availability, enhance its environmental
effectiveness, and improve financial accountability and field
verification of producer accomplishments. NRCS initiated the first
nationwide continuous sign-up for the new CSP on August 10, 2009, with
a September 30, 2009 cutoff date. During this initial ranking period,
NRCS received 21,281 applications covering an estimated 33 million
acres. The acreage is just an estimate at this time, we will have firm
numbers on November 1, 2009. We are currently processing and reviewing
and ranking applications in preparation for awarding contracts.
Following is a summary of Fiscal Year 2009 implementation of NRCS
financial assistance programs:
Program FY 2009 Implementation Highlights as of October 1, 2009

Summary of Financial Assistance Programs FY 2009 Program Implementation
----------------------------------------------------------------------------------------------------------------
Number of Number of Obligation Allocation Percent
Program Applications Contracts Amount Amount Obligated Acres
----------------------------------------------------------------------------------------------------------------
EQIP (all) 106,384 31,965 $731,099,112 $740,784,201 98% 10,003,583
CIG 390 55 $18,400,000 $20,000,000 92% N/A
Organics 1,745 1,203 $30,122,668 $50,000,000 60% N/A
Air Quality 1,638 888 $24,667,849 $24,184,385 98% N/A
Ring Dikes (EQIP) 254 113 $5,291,682 $5,674,602 93% N/A
Ring Dikes (AWEP) 23 20 $955,429 $1,382,400 69% N/A
AWEP 3,807 1,704 $60,385,178 $61,229,000 99% 488,380
Ches. Bay 2,037 826 $18,592,739 $18,800,000 99% 110,327
WHIP 7,353 3,706 $52,018,780 $54,564,896 95% 812,496
AMA 566 214 $6,179,956 $6,108,019 99% 13,874
CSP (Security) N/A 20,683 $246,140,247 $250,249,035 98% 17,413,831
CSP (Stewardship) 21,281 TBD TBD TBD TBD TBD
WRP 1,146 840 $404,611,000 $449,491,000 90 150,000
FRPP 1062 354 $112,915,000 $113,439,000 99.5 78,888
HFRP 94 8 $1,256,457 8,055,000 16 810
GRP Easement 444 72 $24,703,705 $24,724,200 99 56,689
only
----------------------------------------------------------------------------------------------------------------
Sources--EQIP through CSP: ProTracts, as of October 1, 2009.
WRP through GRP: USDA's Foundation Financial Information System, as of Oct. 1, 2009.

The 2008 Farm Bill made a major operational modification to FRPP,
changing it from a land acquisition program to a cost-share program.
While we were able to deliver the program in its new form successfully
and obligate the full FRPP allocation, we continue to review its
administration and look for ways to improve our delivery of FRPP.
The 2008 Farm Bill increased the maximum enrollment in WRP to
3,041,200 acres. To date, NRCS has enrolled approximately 2,175,000
acres in the program, nearly 150,000 acres of which were enrolled
during FY 2009. To meet the total enrollment, NRCS will need to
accelerate its efforts and enroll about 300,000 acres each year through
Fiscal Year 2012. In recognition of the challenge and opportunity that
this presents, we have convened a group of State Conservationists,
Assistant State Conservationists, and contracting personnel to improve
and expand our enrollment and restoration capacity. This group is
charged with developing an implementation plan to reach the maximum
enrollment authorized in the 2008 Farm Bill.
Two other significant changes to WRP were included in the 2008 Farm
Bill. It authorized a 30 year contract option for acreage owned by
Indian tribes, which provides for broader program participation by
Tribes. The 2008 Farm Bill also introduced the Reserved Rights Grazing
Pilot under WREP.
For GRP, the total acreage enrolled under the 2002 Farm Bill was
725,352 acres. The 2008 Farm Bill changed GRP to an acreage-based
program and authorized enrollment of an additional 1,220,000 acres
through 2012, bringing the total acreage goal to 1,945,352. For Fiscal
Year 2009, NRCS obligated 99 percent of the total program allocation of
$48 million. Approximately 72 participants enrolled 56,689 acres in GRP
easements. An estimated 100,000 acres were enrolled as rental
contracts. The remaining 1,063,311 acres will be enrolled through
Fiscal Year 2012.
Going into Fiscal Year 2009, we harbored concerns that demand for
our conservation program assistance may decline, given a national
economy in recession and new program rules for farmers and ranchers to
become accustom to. I can report, however, that we have not seen any
measurable decrease in demand. In fact, for nearly all programs, there
was an increase in applications compared to Fiscal Year 2008. We
believe this is an indicator of the continued success and popularity of
a voluntary approach to private lands conservation.
Program-by-program information on 2008 Farm Bill implementation is
included in Appendix Four.

Assistance to Beginning and Socially Disadvantaged Farmers and Ranchers
I am pleased to report that of the Fiscal Year 2009 funds made
available for EQIP, we met or exceeded the five percent targets
established in the farm bill for both beginning and socially
disadvantaged farmers and ranchers. And although the final sign-up
results are not yet known, I am confident that we will achieve the
national five percent targets established in 2009 CSP acres and
associated funds for beginning and socially disadvantaged farmers or
ranchers, as well.
Both programs utilized separate application pools and increased
outreach efforts, including advertisements through newspapers,
magazines, local publications, radio, personal contacts, meetings,
newsletters, churches, organizations, and community advocacy groups.
National information products were developed to assist in distributing
information at the state and field levels.
NRCS will continue to build upon the successes we have achieved and
seek additional ways to improve access and equity to programs for
historically underserved farmers and ranchers. In 2009, we established
additional set-asides in other programs besides EQIP and CSP. As of
September 24, 2009, with more than 97 percent of the program sign-up
completed, we know:

For socially disadvantaged farmers and ranchers, the
following percentages of funds were obligated: EQIP--6%; AMA--
13%; AWEP--5%; and WHIP--8%.

For beginning farmers and ranchers, the following
percentages of funds were obligated: EQIP--15%; AMA--19%;
AWEP--9%; and WHIP--11%.
Farm Bill Implementation Challenges
Implementation of the 2008 Farm Bill in Fiscal Year 2009, while
ultimately broadly successful, was not without its challenges. Chief
among these was the delayed completion of the adjusted gross income
(AGI) limitation web service that significantly hampered our ability to
make conservation program payments to producers. In addition, we
received the results of an USDA Office of Inspector General (OIG) audit
of the old Conservation Security Program. OIG's findings, and our
corrective actions to address the findings, led to additional workload
on our state and field office personnel.

Adjusted Gross Income Limitation Tool
The 2008 Farm Bill provided new requirements for adjusted gross
income (AGI) that required changes to the existing AGI web service that
is used to determine of program participant eligibility and related
commensurate payment reduction, as determined by membership
attribution. Given the complexity of the changes needed to be made to
the AGI web service, the Department was unable to launch the updated
service in Fiscal Year 2009. The unavailability of the web service
created a challenging situation for NRCS as we scrambled to develop
interim solutions.
Upon realizing that the AGI web service would be unavailable for
payments to be made in Fiscal Year 2009, we worked to create temporary
protocols to help us electronically determine the conservation AGI
eligibility for AMA, FRPP, EQIP, WHIP, and WRP. This allowed us to
begin making the majority of payments on prior year contracts in June
2009.
Fiscal year 2009 EQIP contracts presented additional complications
because of the differences between the program payment limitations
under the 2002 and 2008 Farm Bills. We developed another temporary
workaround that allowed us to begin making payments on new EQIP
contracts in late August. Since then, we have been able to make
payments to producers on both old and new contracts for all of our
financial assistance programs. NRCS has nearly synchronized the
recently completed AGI web service into its systems. It will be
available soon for the processing of Fiscal Year 2010 payments.

Conservation Security Program OIG Audit
In Fiscal Year 2006, OIG conducted an audit concerning NRCS
administration of the Conservation Security Program. The audit assessed
whether NRCS properly determined participant and land eligibility;
effectively handled the sign-up, application, evaluation, and approval
processes; accurately calculated program payments; and successfully
prevented producers from receiving payments from multiple Conservation
Security Program contracts.
At the conclusion of the audit, OIG made the following
recommendations to NRCS:

Improve program design and controls in future sign-ups.

Review all current Conservation Security Program contracts
to validate program eligibility and payment accuracy and take
appropriate action in accordance with NRCS policy.

Review the agricultural operation delineation determinations
on all current Conservation Security Program contracts and take
appropriate action in accordance with NRCS policy.

Obtain from ProTracts a list of participants that are
receiving payments on multiple contracts and take corrective
action in accordance with NRCS policy.

NRCS has taken the following aggressive actions in order to address
the OIG recommendations:

Implemented improvements in program design and controls in
the Conservation Security Program 2008 sign-up that are also
being used in the new Conservation Stewardship Program.

Set a deadline of September 30, 2009 for a complete review
of all active Conservation Security Program contracts.
Qualified NRCS personnel from outside the contract location
reviewed all contracts. Corrective action on any improper
contracts will be completed by December 31, 2009. No Fiscal
Year 2010 payments will be made on improperly developed
contracts until corrective actions have been completed.

Developed a nationally consistent audit tool to determine
deficiencies in contracts and needed corrective actions.

We are confident that these actions and the improved business tools
incorporated into the new Conservation Stewardship Program will
eliminate the types of errors identified in the OIG audit of the
Conservation Security Program.

Looking Ahead
With the 2009 Fiscal Year having drawn to a close, NRCS has turned
its attention to 2010. Implementation of the 2008 Farm Bill will
continue unabated. We will publish final rules for all of our
conservation programs. We will award the first Conservation Stewardship
Program contracts. We will also be evaluating the first year of
implementation for new programs and initiatives and making adjustments.
Along with all of these important activities, I'd like to discuss
some innovative efforts that we have embarked upon to renew our
commitment to improving the delivery of our programs and the quality of
our environmental outcomes.

Conservation Delivery Streamlining
In early 2009, NRCS began an agency-wide effort to create and
implement a more effective, efficient, and sustainable business model
for delivery of science-based conservation assistance. Called the
National Conservation Delivery Streamlining Initiative (NCDSI), the
effort focuses on increasing the time NRCS employees spend in the field
working with farmers and ranchers.
The NCDSI has two key objectives: (1) reduce administrative and
clerical workload on field staff by 80 percent; and (2) enable field
staff to spend 75 percent of their time in the field.
To achieve these objectives, we are redesigning our tools,
processes, and staffing structure to strengthen our technical expertise
and to make smarter use of information technology. We will employ the
following major strategies to ensure conservation assistance processes
are fully integrated agency-wide:

We will clearly define and streamline the processes we use
to provide conservation assistance to producers.

We will make sure the technology we provide to our field
staff better supports the work they do.

We will provide our planners and technical staff with the
science, data, and technology they need for conservation
planning and application.

We will use alternative approaches to staffing and financial
assistance program delivery that are more efficient and enhance
customer service.

We will begin implementing the NCDSI in 2010 with an expected
completion date of 2015.

Landscape Conservation
NRCS understands that in some cases, ``random acts of
conservation'' have not sufficed to address critical resource concerns
at a landscape scale. We are committed to working in a targeted fashion
across landscapes, watersheds and ecosystems to get address
environmental concerns that have been identified as national
priorities. In addition to existing efforts such as the Chesapeake Bay
Watershed Program, the Colorado Salinity Program, and the California
Air Shed effort in the San Joaquin Valley, following are two examples
of new landscape-scale initiatives for Fiscal Year 2010:
Mississippi River Basin Healthy Watersheds Initiative (MRBI)
On September 24, Secretary Vilsack announced the MRBI, a new
targeted effort to address resource concerns, including water quality
and wildlife habitat, in the Mississippi River Basin. MRBI will help
agricultural producers implement conservation and management practices
that avoid, control, and trap nutrient runoff. The initiative is
performance oriented, which means that measurable conservation results
are required in order to participate. By focusing on priority
watersheds in these 12 states in the basin, USDA, its partner
organizations, state and local agencies, and agricultural producers
will coordinate their resources in areas requiring the most immediate
attention and offer the best return on the funds invested.
In addition to other Federal, state, and partner funding, NRCS is
targeting $80 million annually over the next 4 years through CCPI, CIG,
and WREP. These funds are in addition to other NRCS program funding and
assistance such as Environmental Quality Incentives Program, Wildlife
Habitat Incentives Program, and the Conservation Stewardship Program.
The MRBI will be available in Arkansas, Kentucky, Illinois, Indiana,
Iowa, Louisiana, Minnesota, Mississippi, Missouri, Ohio, Tennessee, and
Wisconsin.
MRBI will focus on eight-digit or smaller hydrologic units
(watersheds) that contribute high loads of nutrients in the Mississippi
River Basin. Priority watersheds for the initiative will be identified
by NRCS in consultation with conservation partner organizations and
State Technical Committees. Watersheds will be selected using an
evaluation process that will include information from the Conservation
Effects Assessment Project, the USGS Spatially Referenced Regression on
Watersheds Attributes, state-level nutrient reduction strategies and
priorities, and available monitoring and modeling of nitrogen and
phosphorus levels in the Basin. Using this watershed evaluation process
will ensure water quality and nutrient issues are improving as part of
MRBI.

Great Lakes Restoration Initiative
To accelerate the restoration of the Great Lakes, the President's
FISCAL YEAR 2010 budget includes a new $475 million interagency Great
Lakes Restoration Initiative (GLRI) to address issues that affect the
Great Lakes, such as invasive species, non-point source pollution, and
toxics and contaminated sediment. The GLRI, administered by the
Environmental Protection Agency, builds upon 5 years of work of the
Great Lakes Interagency Task Force and stakeholders, guided by the
Great Lakes Regional Collaboration Strategy. If funded at $475 million,
NRCS' provisional allocation of $33.6 million will help address non-
point source pollution, invasive species, and habitat resource
concerns. The Interagency Task Force is currently working on a
comprehensive Great Lakes Multi-year Restoration Action Plan advances
the GLRI by strategically identifying yearly goals, objectives and
targets for programs and projects to focus on the most significant
environmental problems in the Great Lakes ecosystem.

Conclusion
Thank you for the opportunity to describe our successes and
challenges in implementing the Conservation Title of the Farm Bill. We
look forward to building upon the successes and meeting the challenges
to improve the technical and financial assistance that we provide to
the nation's farmers and ranchers in 2010. I am happy to respond to any
questions at this time.

Appendix One

2008 Farm Bill Implementation
Regulatory and Other Documents Published Before January 20, 2009
Agricultural Management Assistance (AMA) Program Interim Final
Rule: published in the Federal Register on November 20, 2008.
Chesapeake Bay Watershed Notice of Availability of Funds: published
in the Federal Register on January 22, 2009--implemented through EQIP
Conservation Innovative Grants (CIG) Notice of Availability of
Funding: published in Grants.gov January 16, 2009
Environmental Quality Incentives Program (EQIP) Interim Final Rule:
published in the Federal Register on January 15, 1009
Farm and Ranch Lands Protection Program (FRPP) Interim Final Rule:
published in the Federal Register on January 16, 1009
Healthy Forests Reserve Program (HFRP) Proposed Rule: published in
the Federal Register on January 14, 2009
Regional Equity (RE) Interim Final Rule: published in the Federal
Register on January 13, 2009
State Technical Committee (STC) Interim Final Rule: published in
the Federal Register on November 25, 2008
Technical Service Provider Assistance (TSP) Interim Final Rule:
published in the Federal Register on January 16, 2009
Wetlands Reserve Program (WRP) Interim Final Rule: published in the
Federal Register on January 15, 2009
Wildlife Habitat Incentive Program (WHIP) Interim Final Rule:
published in the Federal Register on January 16, 2009
Appendix Two
2008 Farm Bill Implementation
Regulatory Documents Published After January 20, 2009
Agricultural Management Assistance Program; Correction--Corrects
the application of payment limitation provisions as they apply to joint
operations. This document did not reopen the public comment period.

Status: Published March 12, 2009

Public comment period closed January 20, 2009

Agricultural Water Enhancement Program Notice of Request for
Proposals; reopening and extension of proposal submission deadline--
original deadline March 2; new deadline April 1.

Status: Published March 26, 2009

Conservation Practice Technical Assistance Notice with Request for
Comment--The 2008 Act, requires that NRCS: (1) review conservation
practice standards, including engineering design specifications, in
effect on June 18, 2008; ensure the completeness and relevance of the
standards to local agricultural, forestry, and natural resource needs;
and ensure that the standards provide for the optimal balance between
meeting site-specific conservation needs and minimizing risks of design
failure and associated costs of construction and installation. NRCS
conducted an internal review of the conservation practice standards and
met with various stakeholder groups to obtain their input about how to
improve the completeness and relevance of the standards. This notice
provides the results of the preliminary review to the public and
requests comments about how to improve the conservation practice
standards.

Status: Published June 12, 2009

Public comment period was opened for 60 days from date of
publication then reopened for an additional 30 days to
September 14, 2009.

Conservation Stewardship Program (CSP) Interim Final Rule with
Request for Comment

Status: Published July 29, 2009

Public comment period is open through October 28, 2009

Cooperative Conservation Partnership Initiative (CCPI) Notice of
Request for Proposals; Request for public comment

Status: Published March 10, 2009

Deadlines: Public comment by April 8th; Proposal submission by
April 23rd

Environmental Quality Incentives Program; Correction, request for
comment and extension of public comment period--Corrects the
application of payment limitations as they apply to joint operations
and seeks public comment on using EQIP for furthering the nation's
efforts with renewable energy production and energy conservation,
climate change mitigation and facilitating adaptation, and carbon
sequestration.

Status: Published March 12, 2009

Public comment period extended to April 17, 2009

Environmental Quality Incentives Program Interim Final Rule
Amendment--This document reestablishes policy that enables certain
producers, who lease public lands, to be able to use EQIP funds on the
public lands.

Status: Published May 29, 2009

Public comment period opened through June 29, 2009. Submitted
comments are limited to contents of the amendment.

Farm and Ranch Lands Protection Program; Interim Final Rule
amendment and extension of public comment period--This document
clarifies the ``contingent right of enforcement'' and reopens the
public comment period through August 3. In addition, NRCS is
incorporating preamble language that seeks public input on how FRPP can
be used to further the nation's interest in renewable energy
production, energy conservation, carbon sequestration and mitigating
climate change and facilitating climate change adaptation.

Status: Published July 2, 2009

Grassland Reserve Program Interim Final Rule: Approved for
publication during the Bush Administration and published in the Federal
Register January 21, 2009.
Grassland Reserve Program; Interim Final Rule amendment and
reopening of public comment period--This amendment clarifies the
``contingent right of enforcement'' language, removes the prohibition
of producing energy for off farm use, and reopens the public comment
period for 30 days from date of publication. In addition, NRCS is
incorporating preamble language that seeks public input on how GRP can
be used to further the nation's interest in renewable energy
production, energy conservation, carbon sequestration and mitigating
climate change and facilitating climate change adaptation.

Status: Published on August 21, 2009

Public comment period is open to September 21, 2009

Healthy Forests Reserve Program; Reopening and extension of public
comment period

Status: Published February 18, 2009

Public comment period extended from February 13, 2009, to March
20, 2009

State Technical Committees Notice of Standard Operating Procedures
with Request for public comment--The 2008 Act requires the Secretary to
develop standard operating procedures to standardize the operation of
State Technical Committees.

Status: Published April 7, 2009

Public comment period closed June 8, 2009. This document will
be incorporated into the NRCS directives system.

Wetlands Reserve Program; Interim Final Rule Amendment and
reopening of public comment period--This amendment ensures NRCS is able
to restore all lands enrolled in the program despite events subsequent
to enrollment, corrects the eligibility criteria related to closed
basin lakes and potholes, and notifies the public of the agency's
continued dedication to proactive restoration. This document reopens
the public comment period.

Status: Published June 2, 2009

Public comment period opened through July 2, 2009

Wildlife Habitat Incentive Program; Correction, request for comment
and extension of public comment period--Corrects the application of
payment limitations as they apply to joint operations and seeks public
comment on using WHIP for furthering the nation's efforts with
renewable energy production and energy conservation, climate change
mitigation and facilitating adaptation, and carbon sequestration.

Status: Published March 12, 2009

Comment period extended to April 17, 2009

Wildlife Habitat Incentives Program Interim Final Rule amendment--
This document expands the definition of agricultural lands to enable
producers to enroll all lands included in their farming operation. The
Interim Final Rule limited application to lands that were used for
production.

Status: Published July 15, 2009

Comment period reopened until August 14, 2009 Public comments
limited to the definition of agricultural land.
Appendix Three
2008 Farm Bill Implementation
Final Rule Completion Schedule
The following final rules are tentatively scheduled to be published
by the end of the first quarter of Fiscal Year 2010:

Agricultural Management Assistance Program (AMA)

Regional Equity (RE)

State Technical Committees (STC)

Technical Service Provider Assistance (TSP)

The following final rules are tentatively scheduled to be submitted
for OMB review by the end of the first quarter of Fiscal Year 2010:

Environmental Quality Incentives Program (EQIP)

Farm and Ranch Lands Protection Program (FRPP)

Grassland Reserve Program (GRP)

Healthy Forests Reserve Program (HFRP)

Wetlands Reserve Program (WRP)

Wildlife Habitat Incentive Program (WHIP)

The CSP Final Rule is scheduled for completion in early 2010.

Appendix Four

Program-by-Program Review of 2008 Farm Bill Implementation
Environmental Quality Incentives Program (EQIP)
As indicated above, the 2008 Farm Bill introduced or continued a
number of distinct components to EQIP. Each of these components is
treated separately below. The base EQIP program offers contracts with a
minimum term that ends 1 year after the implementation of the last
scheduled practices and a maximum term of 10 years. These contracts
provide financial assistance to implement conservation practices.
Owners of land in agricultural production or persons who are engaged in
livestock or agricultural production on eligible land may participate
in the EQIP program. Program practices and activities are carried out
according to an EQIP program plan of operations developed in
conjunction with the producer that identifies the appropriate
conservation practice or measures needed to address the resource
concerns. The practices are subject to NRCS technical standards adapted
for local conditions.
Changes to EQIP in the 2008 Farm Bill allowed us to place
additional emphasis on private non-industrial forest land. We
encouraged owners of this land type to participate in EQIP to develop
forest management plans and to implement forestry practices to increase
conservation efforts on these lands.
We successfully obligated nearly the entire EQIP allocation of
$1.067 billion for Fiscal Year 2009 (a small amount was retained for
future cost overruns). Nationwide, we received 106,384 applications and
approved 30,965 as contracts. These contracts represent 11,651,207
acres. As required by the farm bill, 60 percent of EQIP funding is used
for livestock-related practices.

EQIP Conservation Innovation Grants
Conservation Innovation Grants was first authorized in the 2002
Farm Bill as a component of EQIP. Through CIG, EQIP funds are used to
award competitive grants to non-Federal governmental or non-
governmental organizations, federally-recognized Indian tribes, or
individuals. Applications are accepted from all 50 states, the
Caribbean Area (Puerto Rico and the Virgin Islands), and the Pacific
Islands Area (Guam, American Samoa, and the Commonwealth of the
Northern Mariana Islands). Selected applicants may receive grants of up
to 50 percent of the total project cost. Applicants must provide non-
Federal funding for at least 50 percent of the project cost, of which
up to \1/2\ (25 percent of the total project cost) may come from in-
kind contributions.
On January 16, 2009 NRCS announced the availability of $20 million
for the national-level CIG in Fiscal Year 2009. Four separate
categories were offered--``Natural Resources,'' ``National
Technologies,'' ``Grant Leveraging,'' and ``Chesapeake Bay Watershed.''
Over 390 proposals were received, a record number. Fifty-five
applications were selected for awards. An additional $5.5 million was
made available by states for state-level CIG awards. Since 2004, NRCS
has awarded $108 million to 316 projects through CIG.

EQIP Organic Program Initiative
The 2008 Farm Bill included authority for use of EQIP to help
organic growers farm under the standards of the National Organic
Program (NOP). The Organic Program Initiative makes available financial
and technical assistance to help producers, both those transitioning to
organic production and those already certified as organic, meet their
conservation goals. As of September 9, 2009, there were 1201 approved
contracts for Fiscal Year 2009 under this initiative, and approximately
$30,280,294 had been obligated. Another sign-up period will be held in
the beginning of Fiscal Year 2010.

EQIP Air Quality Initiative
The 2008 Farm Bill authorized NRCS to provide eligible producers
with technical and financial assistance to address air quality
challenges through EQIP. Funds are used to address the primary air
quality natural resource concerns associated with Environmental
Protection Agency (EPA) ``non-attainment'' areas for the ambient air
quality standards of: particulate matter 2.5, particulate matter 10,
and 8 hour ozone.
Just over $24 million was obligated to producers through this new
initiative in Fiscal Year 2009. Out of nearly 1,600 applications were
submitted, 900 contracts were approved.

Chesapeake Bay Watershed Program
The 2008 Farm Bill authorized the Chesapeake Bay Watershed Program
(CBWP) to protect and restore the health, heritage, natural resources,
and social and economic value of the nation's largest estuarine
ecosystem. The CBWP funding--$23 million in EQIP funds for Fiscal Year
2009--is used to improve water quality and conserve water quantity
while restoring, enhancing, and conserving soil, air, and related
resources. As of September 30, 2009, we obligated 95 percent of the $23
million available for Fiscal Year 2009.
As of August 31, 2009, in this first year of the initiative, over
765 contracts were developed with farmers to install a variety of pre-
selected conservation practices such cover crops, conservation tillage,
buffer and filter strips, stream bank fencing, grassed waterways,
nutrient management, and tree planting. These contracts cover more than
98,000 acres of farmland. NRCS is focusing CBWP funding on
legislatively mandated (by the 2008 Farm Bill) river basins
(Susquehanna, Shenandoah, Potomac, and Patuxent Rivers) and other high-
priority sub-watersheds. These sub-watersheds were selected based on
nitrogen, phosphorous, and sediment loads delivered to the Bay; stream
impairment; partner resources; and ability to demonstrate results.

EQIP Ring Dike Initiative
In an effort to improve water quality in flood prone areas in
Minnesota and North Dakota, NRCS allocated $5.7 million through EQIP
and $1.4 million through AWEP for installation or enhancement of ring
dikes around farmsteads. Ring dikes are earthen structures that protect
the farmstead from overland flooding, reducing the potential for
chemical, hydrocarbon, and agricultural wastes to enter flood waters.
The sign-up for this special initiative was conducted between June
15 and July 15, 2009. Agricultural producers were eligible to receive
up to 75 percent of the cost of building the dike to protect their
farmstead. Beginning, limited resource, and socially disadvantaged
farmers were eligible to receive up to 90 percent of the cost of dike
installation.
For the EQIP funding, 254 applications were submitted, 113 of which
were approved as contracts. For AWEP, there were 23 applications, 20 of
which were approved as contracts.

Conservation Activity Plans Pilot
The 2008 Farm Bill provides authority to use EQIP financial
assistance for payment of practices and conservation activities
involving the development of plans appropriate for the eligible land of
a program participant. Specifically, NRCS is authorized to use EQIP for
the development of comprehensive nutrient management plans and other
plans that further the purposes of the program. EQIP payments are made
directly to program participants for development of approved
conservation plans by certified technical service providers (TSPs).
For Fiscal Year 2009, NRCS approved the use of 12 types of CAPs on
a pilot basis in volunteering states. The pilot volunteer states are:
Alabama, Arizona, Arkansas, California, Colorado, Connecticut,
Delaware, Idaho, Illinois, Indiana, Louisiana, Maine, Maryland,
Massachusetts, Michigan, Minnesota, Missouri, Nebraska, New Hampshire,
New Mexico, New York, North Dakota, Ohio, Oregon, Pennsylvania, Rhode
Island, South Dakota, Tennessee, Texas, Utah, Vermont, West Virginia,
and Wyoming.
An evaluation of Fiscal Year 2009 effort will be conducted and
results of this evaluation will be used to improve and expand the CAP
initiative for Fiscal Year 2010.

------------------------------------------------------------------------
Conservation Activity Plans # of States Piloting
------------------------------------------------------------------------
Comprehensive Nutrient Management Plan 18
Forest Management Plan 24
Grazing Management Plan 10
Integrated Pest Management Plan 4
Irrigation Water Management Plan 8
Agricultural Energy Management Plan 8
Comprehensive Air Quality Management Plan 0
Drainage Water Management Plan 1
Conservation Plan Supporting Transition from 1
Irrigation to Dry-land Farming Plan
Conservation Plan Supporting Organic Transition 15
Fish and Wildlife Habitat Management Plan 4
Pollinators Habitat Conservation Plan 0
------------------------------------------------------------------------

Cooperative Conservation Partnership Initiative
Authorized in the 2008 Farm Bill, CCPI is a voluntary conservation
initiative through which NRCS enters into partnership agreements with
eligible entities that want to enhance focused conservation efforts on
agricultural lands, nonindustrial private forestlands, and Tribal
lands. Eligible producers, who participate in a project area identified
in an approved partner agreement, may apply for program assistance.
Eligible programs include EQIP, WHIP, and CSP.
CCPI gives NRCS another mechanism to bolster locally-led
conservation. For the pilot year of CCPI in Fiscal Year 2009, NRCS set
aside six percent of both WHIP and EQIP funds for implementation of
CCPI. In Fiscal Year 2010, in addition to WHIP and EQIP funds, six
percent of CSP acres will be set aside for participation in the CCPI
program.

Agricultural Water Enhancement Program
AWEP is a voluntary conservation initiative that provides financial
and technical assistance to agricultural producers to implement
agricultural water enhancement activities for the purposes of
conserving surface and ground water and improving water quality. As
part of EQIP, AWEP operates through contracts with producers to plan
and implement conservation practices in project areas established
through partnership agreements that work to leverage partner resources
with NRCS funding.
AWEP represents a new operational concept and a new way to work
with partners. We believe that this initial year was very successful.
3,828 applications were submitted, of which 1,380 covering 378,535
acres were approved as contracts. In response to concerns voiced by
some program applicants, we intend to establish a team to review the
Fiscal Year 2009 implementation of AWEP. Recommendations from this team
will be used to improve the program for Fiscal Year 2010.

Wildlife Habitat Incentives Program
WHIP is a voluntary program for developing or improving high-
quality habitat to support fish and wildlife populations of National,
State, Tribal, and local significance. Through WHIP, NRCS provides
technical and financial assistance to private and Tribal landowners for
the development of upland, wetland, aquatic, and other types of
wildlife habitat.
The 2008 Farm Bill made two changes of great consequence to WHIP.
First, it restricted WHIP practices to private lands, when public lands
had been eligible under the 2002 Farm Bill. Second, it reduced the
maximum annual payment to $50,000. As of September 28, 2009, 94 percent
of the Fiscal Year 2009 WHIP allocation had been obligated. Of the
7,412 applications submitted, 3,711 representing 810,370 acres were
approved as contracts.

Agricultural Management Assistance
The AMA program provides assistance to agricultural producers to
voluntarily address issues such as water management, water quality, and
erosion control by incorporating conservation into their farming
operations. Producers may construct or improve water management
structures or irrigation structures; plant trees for windbreaks or to
improve water quality; and mitigate risk through production
diversification or resource conservation practices, including soil
erosion control, integrated pest management, or transition to organic
farming.
AMA was brought under the payment eligibility criteria of the farm
bill in 2008. The bill also added Hawaii as the sixteenth state
eligible for AMA funding. The other 15 states are: Connecticut,
Delaware, Maine, Maryland, Massachusetts, Nevada, New Hampshire, New
Jersey, New York, Pennsylvania, Rhode Island, Utah, Vermont, West
Virginia, and Wyoming. For Fiscal Year 2009, the entire AMA allocation
of $7.5 million was obligated. Out of 569 applications submitted, 210
representing 13,728 acres were approved as contracts.

Conservation Security Program
The Conservation Security Program, authorized in the 2002 Farm
Bill, provides assistance to producers to promote the conservation and
improvement of soil, water, air, energy, plant and animal life, and
other conservation purposes. It is a voluntary conservation program
that supports ongoing stewardship of private agricultural lands by
providing payments for maintaining and enhancing natural resources.
Although the Conservation Security Program was not re-authorized in
the 2008 Farm Bill, NRCS continues to make payments to prior year
contract participants. In Fiscal Year 2009, obligations totaled over
$246 million with payments made on 20,683 contracts. Payments under
this program will continue until the last contracts expire at the end
of Fiscal Year 2017.

Conservation Stewardship Program
In the 2008 Farm Bill, Congress replaced the old Conservation
Security Program with the new Conservation Stewardship Program. CSP
encourages land stewards to improve their conservation performance by
installing and adopting additional activities, and improving,
maintaining, and managing existing activities on agricultural land,
nonindustrial private forest land, and Tribal land. Following is a list
of improvements of the new CSP program over the old Conservation
Security Program.

CSP is now implemented nationwide with a continuous sign-up
process that has periodic cut-off periods for ranking and
funding of applications. The old program was only available in
select watersheds each year.

Nonindustrial private forest land has been added as an
eligible land use.

NRCS State Conservationists have management responsibility
for an acreage allocation with associated funding based on
proportion of eligible land and conservation needs. This shifts
a significant portion of the programmatic decision making from
the national level to the states. State Conservationists, in
consultation with State Technical Committees and local working
groups, will focus their CSP programs on natural resources that
are of specific concern in their state, or on specific
geographic areas within the state. Applications are evaluated
relative to other applications that address similar priority
resource concerns. This process facilitates a competitive
application selection process among applicants who face similar
resource challenges.

Retrospective payments allow for on-site field verification
for all pre-approved applications to substantiate that
participants' representations are accurate prior to contract
obligation and payment.

Participation is based on how producers define their
operation for other USDA programs. This change fixes a
significant issue with the old program and helps ensure that
CSP participants are the people responsible for day-to-day
management and decision making on the agricultural operation.

Direct payment attribution to real persons will ensure
compliance with producer payment limitations, while
accommodating multiple contracts per participant.

With broadened availability, CSP will expand the nation's
agricultural and forestry producers' ability to reach greater levels of
conservation performance. The conservation benefits derived from
maintaining and enhancing natural resources will assist in improving
the quality of soil and water, assist in addressing global climate
change, and may encourage environmentally responsible energy
production.
NRCS initiated the first nationwide continuous sign-up for the new
CSP on August 10, 2009, with a September 30, 2009 cutoff date. We are
currently reviewing and ranking applications in preparation for
awarding contracts. A second sign-up cut-off is tentatively scheduled
for mid-January 2010.
In preparation for CSP implementation, NRCS developed outreach
strategies at the national, state, and local levels to ensure potential
applicants who control eligible land are aware they may be eligible to
apply for CSP. Special outreach efforts were made to eligible producers
with historically low participation rates, such as historically
underserved producers. States made an effort to reach all eligible
producers through various means, including newspapers, magazines, local
publications, radio, personal contacts, meetings, newsletters,
churches, organizations, and community advocacy groups. National
information products were developed to assist in distributing
information at the state and field levels, including the producer self-
assessment checklist and a postcard for mass mailing. The personal mass
mailing effort was done to increase distribution of CSP information to
potential participants.
The pilot ranking period for CSP will help us determine certain
aspects of how we will administer the program in the future. For issues
like payments and enhancements, it is a constantly evolving effort to
put in place the most relevant and effective methods for helping
producers get conservation on the ground.
To manage program funding and meet legislative requirements, NRCS
is using the first ranking period as a payment discovery period to
arrive at a uniform payment rate per land use conservation performance
point. Using enrollment data from the sign-up, unique conservation
performance payment rates will be determined for each land use type
after ranking decisions are made. It is anticipated the information
gained will assist in arriving at set payment rates for future years'
contracts.
Innovative conservation activities, specifically enhancements, hold
the key to CSP's environmental success. From a program equity and
outreach perspective, enhancements need to provide viable opportunities
for producers to increase their conservation performance across all
land uses, operation sizes and types, and production systems, including
specialty crops and organic production. NRCS will institute a
continuous improvement process to develop innovative enhancements,
while engaging others in identifying enhancement opportunities, as
well.
During the first CSP ranking period, NRCS received 21,281
applications covering an estimated 33 million acres. The acreage is
just an estimate at this time, we will have firm numbers on November 1,
2009. We are currently processing and reviewing and ranking
applications in preparation for awarding contracts.
Farm and Ranch Lands Protection Program
FRPP provides matching funds to help purchase development rights to
keep productive farm and ranchland in agricultural uses. Working
through existing state and local programs, USDA partners with state,
Tribal, or local governments and non-governmental organizations to
acquire conservation easements or other interests in land from
landowners. USDA provides up to 50 percent of the fair market easement
value of the conservation easement.
The 2008 Farm Bill made a significant modification to FRPP by
changing the program from a Federal land acquisition program to a cost-
share program. This means that, while the Federal government maintains
a contingent right of enforcement, it no longer appears on the easement
deed as a grantee and is no longer a co-owner of the easement.
In Fiscal Year 2009, NRCS obligated the total program allocation of
$105 million, helping entities enroll an estimated 70,000 acres on 350
parcels.

Grassland Reserve Program
GRP is a voluntary conservation program that emphasizes support for
working grazing operations, enhancement of plant and animal
biodiversity, and protection of grassland under threat of conversion to
other uses. Participants voluntarily limit future development and
cropping uses of the land while retaining the right to conduct common
grazing practices and operations related to the production of forage
and seeding, subject to certain restrictions during nesting seasons of
bird species that are in significant decline or are protected under
Federal or state law.
For GRP, the total acreage enrolled under the 2002 Farm Bill was
725,352 acres. The 2008 Farm Bill changed GRP to an acreage-based
program and authorized enrollment of an additional 1,220,000 acres
through 2012, bringing the total acreage goal to 1,945,352. For Fiscal
Year 2009, NRCS obligated 99 percent of the total program allocation of
$48 million. Approximately 72 participants enrolled 56,689 acres in GRP
easements. An estimated 100,000 acres were enrolled as rental
contracts. The remaining 1,063,311 acres will be enrolled through
Fiscal Year 2012.

Healthy Forests Reserve Program
HFRP is a voluntary program established for the purpose of
restoring and enhancing forest ecosystems to: (1) promote the recovery
of threatened and endangered species, (2) improve biodiversity; and (3)
enhance carbon sequestration. The 2008 Farm Bill made three significant
changes to HFRP. The first change allows NRCS to enroll lands in
permanent easements. The second change stipulates that 40 percent of
HFRP funding must be expended on cost-share agreements, and 60 percent
on easements. The third major change allows for a 30 year contract
option for Tribes and Tribal members.
For Fiscal Year 2009, NRCS obligated $2.1 million out of the $9.75
in no-year money available annually under the 2008 Farm Bill. Nine 30
year or permanent easements covering approximately 1,100 acres have
been enrolled in the program. Prior to 2009, there were six restoration
agreements covering 684,707 acres and two easements covering 1,000
acres.
We were unable to use the full HFRP allocation in Fiscal Year 2009.
HFRP is a complex new program that requires significant start-up time
to establish partnership roles, contracting procedures, ranking
criteria, and criteria for appraisals. With many of these tasks
complete, we are confident in our ability to obligate the full HFRP
allocation in future years.

Wetland Reserve Program
WRP is a voluntary program offering landowners the opportunity to
protect, restore, and enhance wetlands on their property. NRCS provides
technical and financial support to help landowners with their wetland
restoration efforts. NRCS's goal is to achieve the greatest wetland
functions and values, along with optimum wildlife habitat, on every
acre enrolled in the program.
The 2008 Farm Bill modified WRP's authorizing language to add a 30
year contract option for acreage owned by Indian tribes. Prior to
Fiscal Year 2009, easements and restoration cost-share agreements were
the only enrollment options available for WRP participants. Because the
placement of easements on Tribal lands caused legal and administrative
impediments to Tribal participation, the newly authorized WRP 30 year
contract provides for broader program participation by Tribes. In
Fiscal Year 2009, four Indian Tribes in Nebraska enrolled 2,156 acres
of Indian lands in WRP through the 30 year contract option.
The 2008 Farm Bill also changed the methodology for establishing
WRP easement compensation. The compensation is now the lowest of : (1)
The fair market value of the land or an area-wide market analysis or
survey; (2) The geographical area rate cap (GARC); or (3) The offer
made by the landowner. Previously, the compensation was based on an
appraisal methodology commonly referred to as ``Yellow Book.''
Another change in the 2008 Farm Bill requires that the ownership of
land not have changed in the prior 7 years for the land to be eligible
for the WRP (the limit was just 1 year under the 2002 Farm Bill). The
WRP interim final rule includes a provision allowing for waivers to the
7 year ownership requirement. Only the NRCS Chief can provide a waiver
to the 7 year provision. As of September 16, 2009, 259 waiver requests
have been submitted to the Chief for consideration. 243 of these
requests have been approved. For the 16 denied requests, the landowners
did not provide adequate assurances that the land was not acquired for
the express purpose of enrolling it in WRP. The majority of requests
for a waiver were for the following reasons: (1) the current landowner
purchased property that had been in the family for more than 7 years
from another family member; or (2) the current landowner received the
property as a result of estate planning of their parents; or (3) the
current landowner purchased property that they had farmed for a number
of years prior to purchase.
The 2008 Farm Bill increased the maximum enrollment in WRP to
3,041,200 acres. To date, NRCS has enrolled approximately 2,175,000
acres in the program, nearly 150,000 acres of which were enrolled
during FY 2009. To meet the total enrollment, NRCS will need to
accelerate its efforts and enroll about 300,000 acres each year through
Fiscal Year 2012. In recognition of the challenge and opportunity that
this presents, we have convened a group of State Conservationists,
Assistant State Conservationists, and contracting personnel to improve
and expand our enrollment and restoration capacity. This group is
charged with developing an implementation plan to reach the maximum
enrollment authorized in the 2008 Farm Bill.
Finally, the 2008 Farm Bill provides for WRP enrollment of
agricultural areas subject to flooding from the natural overflow of a
closed basin, lake, or pothole. This program is available in the
prairie pothole regions of Iowa, Minnesota, Montana, North Dakota and
South Dakota. For Fiscal Year 2009, approximately $2 million was
allocated for the Devil's Lake area in North Dakota.
Wetlands Reserve Enhancement Program
The Wetlands Reserve Enhance Program (WREP) allows NRCS to enter
into agreements to carry out special projects that that will improve or
expand WRP activities, including wetlands restoration, creation, or
enhancement, or easement management. WREP focuses on projects that
include significant partnership contributions.
The 2008 Farm Bill established the Reserved Rights Grazing Pilot
under WREP. For Fiscal Year 2009, Alabama and Nebraska participated in
the pilot, obligating more than $2.4 million covering 4,607 acres.

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The Chairman. Thanks, Chief White.
And, Chief, thanks for your help for the rulemaking and
implementation of the Farm and Ranch Land Protection Program.
We really have made some significant changes.
But I am just going to enter into the record--and I am sure
you have seen it--a letter from the Secretaries of Agriculture
from Connecticut, Delaware, Maine, Maryland, Massachusetts,
Michigan, New Hampshire, New Jersey, New York, Pennsylvania,
Rhode Island, and Vermont twice here. It was sent to the
Secretary in September. I am sure you have seen it, but, if
not, if you would just review it. You don't have to answer that
today; just get back to us on it.
[The document referred to is located on p. 61.]
The Chairman. But I am wondering, even though we have made
significant changes, I believe, that were positive, have you
seen a decline in state-level participation because of these
unresolved issues that were in the letter sent to the
Secretary?
Mr. White. No. And speaking of that letter, Mr. Chairman,
not only have I seen it, I have read it, I have studied it, and
I am ready to answer it right now if you want to.
We are going to have a teleconference. Thirteen states
signed this letter. We are trying to set up a teleconference
between myself and some staff and help them to work through
some of these issues.
Now, we think we have the contingent right of enforcement
fixed. They are bringing up some other issues. Some of them we
agree with; we think we will be able to work them out. Some of
them, I think, that we are going to have more problems working
that out. Like, there in their letter, they say they want to
eliminate the requirement that we do a hazardous materials
search or landowner interviews. I don't want to participate in
buying a Superfund site. I think we need to keep some Federal
control over that.
We have some issues over impervious surfaces. You should
have some photos there. You can see some greenhouses. This is
from one of those 13 states. This is what happens when you
don't have an impervious surface limit. We would like to keep
some of that open land open.
There are four or five things that we really have to work
with them on. I think there is a lot of stuff we are in
agreement with, Mr. Chairman, and I promise you we will try to
resolve it.
The Chairman. Thank you.
Mr. Coppess, you mentioned in your oral testimony open
fields briefly. Is FSA working on getting the rules published
for this program? Can you explain what the delay has been?
Also, there was $50 million in mandatory spending for this
program. Has OMB given an apportionment for the 2010 Fiscal
Year? And what happened to the mandatory money?
Mr. Coppess. Right. We are in the process of expediting the
implementation of that program now. I expect that within the
next several months we should have that out.
The mandatory money, as I understand it, remains throughout
the course of this farm bill, so we don't lose anything by not
having apportioned or spent it until this point in time.
Because the rule is not out yet, OMB has not apportioned
any funding for that. But we are working to get that through as
quickly as we can. We will have the money ready to go as soon
as we can after the rule gets out.
The Chairman. Thank you.
Chief White, in reference to the Chesapeake Bay Program, it
was created in the farm bill for USDA to run, operate, and make
the decisions regarding funding. Given the Administration's
Executive Order on the Chesapeake Bay, how are you coordinating
with the other agencies, but maintaining control over this
program?
Mr. White. Well, we will cooperate and consult with anyone,
Mr. Chairman, but let me assure you that USDA is going to
maintain control of that.
This year, we had a pretty successful year. The decisions
were made. We used a locally based process. Mr. Thompson and
Mr. Massa, you and Mr. Kratovil, we talked about that several
months ago. We will maintain control of that program. We will
cooperate with everyone and their brother, but we are not about
to cede the authority that you gave us.
The Chairman. And you have seen a lot of producer interest
in the program?
Mr. White. Oh, oh, yes. If I can find the thing, I can tell
you the sign-up that came through that.
Chesapeake Bay, we had 2,037 applications. We were able to
fund 826 of those. We used something like 98.4 percent of all
the funds. When I say we obligated 98.4 percent, you don't want
to obligate 100 percent in case you have some adjustments or
modifications, 98.4 percent were obligated, roughly 40 percent.
And, this year, you guys gave us a lot more and we are going to
do more.
The Chairman. Thank you.
The chair recognizes the gentleman from Virginia.
Mr. Goodlatte. Thank you.
Of those 2,000 applications, how spread out across the
Chesapeake Bay region were they?
Mr. White. Yes, I can give you a breakdown by state, but I
am thinking, Mr. Goodlatte, 99 percent of them were in your
district. That would be my off-the-head estimate.
Mr. Goodlatte. I am sure you are going to object.
You don't want tick off the Chairman here.
Mr. White. The other 98 percent were in his district.
I don't know the breakdown, but we will get that for you.
Mr. Goodlatte. Yes, I think both the Chairman and the
Ranking Member would like to see that breakdown.
Mr. White. You got it.
Mr. Goodlatte. What can you tell me about the big
conversation we had in this Committee during the markup of the
farm bill regarding the segmentation of EQIP funds? Your
testimony indicates that 15 percent of EQIP funds in 2009 were
obligated to beginning farmers and ranchers. What factors
contributed to such a high percentage when the law establishes
a five percent set-aside?
Mr. White. Well, we actually--that five percent was to, my
understanding, was to guarantee that these beginners--it
doesn't say you can't go above that, unless I am wrong. Is that
part of the not meeting Congressional intent concern?
Mr. Goodlatte. No, no. I think we are wanting to make sure
that you are being fair to everybody involved.
Mr. White. Oh, yes, sir. We did have these five percent
set-asides. Those were used up. And if a person qualified, they
would also be allowed into the program. So, it is a great thing
that we are getting this many beginners--I won't say young
farmers--I will say beginning farmers and ranchers into these
programs.
But if there is an issue where we are discriminating
against non-beginners, I will need to find out what exactly is
occurring. But I don't think that has occurred, sir.
Mr. Goodlatte. And what efforts are you making to undertake
outreach to private forest owners who may not be aware that
they are eligible for programs like EQIP and CSP?
Mr. White. We have to do a better job. You know we did a
lot of work, or you guys did a lot of work in the 2008 Farm
Bill. Nonindustrial private forestland is a part of EQIP, a
bigger part, although we could have done it before. Some states
did. And it certainly--10 percent of the Conservation
Stewardship Program can be nonindustrial private forestland.
From the application so far just from CSP, Mr. Goodlatte,
we have exceeded the--the amount of acres offered for
enrollment exceed the 10 percent that we can do in that
program. So I think we are cool in that.
I think what we have to do is a better job of outreach to
the nonindustrial private forestland owners to make doggone
sure that they know that those things are available. And we
will take that on as a commitment.
Mr. Goodlatte. Now, conversely, you have some programs that
are oversubscribed, at least. And would you provide the
Committee with an overview of which programs have backlogs and
how extensive those backlogs are?
Mr. White. Can I do that in writing? Because I don't have
all that backlog stuff in my head.
Mr. Goodlatte. Yes, absolutely. Thank you.
In that regard, one of the most popular programs we have,
obviously, is EQIP. And during our conference, many Members
worried about the backlog that we had in EQIP. The general
consensus was that this is a great program that helped
producers deal with environmental regulations and was extremely
popular.
In addition, we worried greatly that carve-outs and other
pet projects would erode the funding for this program and would
simply extend the backlog. Members tried to strike a delicate
balance between these carve-outs and the needs of producers
throughout the country.
Now we hear the NRCS has started a Mississippi River Basin
Initiative above and beyond the statutory limit set by the law.
In fact, material about this new initiative explicitly states
this funding is, ``above and beyond'' regular CCPI funding. The
law states, ``Funding Reservation: Of the funds and acres made
available for each of Fiscal Years 2009 through 2012 to
implement the programs described in subsection (c)(1), the
Secretary shall reserve six percent of funds and acres to
ensure an adequate source of funds and acres for the
initiative.''
Where does the Department get the statutory authority to go
above the six percent? And why would the Department use its
authority to go beyond what was obviously a limitation?
Mr. White. Okay. CCPI is one of the new tools that you
provided for us in the 2008 Farm Bill. It allows us to work
with partners, cooperatively, to solve resource problems.
You are absolutely right about the Mississippi River. In
fact, we looked at the Chesapeake Bay as kind of the model to
do that, to target resources to solve specific issues.
The six percent--we have talked to the Office of General
Counsel. We feel that we are on firm legal ground. I can
provide you with written materials on that.
We will not take away--or, the goal is not to take away
from any states ongoing applications, the county-based EQIP
applications that are available nationwide. You provided
increased funding for EQIP and many of the other programs,
where I would look as--assuming that we do get that increased
funding, that is where that extra money would come from. I am
not going to rob Virginia to give it to Alabama, or to
Mississippi, or something like that. Each state is going to get
their----
Mr. Goodlatte. Leaving the mid-Atlantic region, which does
have a statutorily designated program for the Chesapeake Bay,
you are then left with a situation where you have
oversubscription of this program all across the country. Yet,
you have, without--I mean, the Congress debated this at great
length, and I have no doubt that some in the Mississippi River
Delta would very much appreciate what you have chosen to do.
But I am not sure that you have the statutory authority to give
a preference in that area when there is no Congressional
mandate to do so. And, in effect, you are taking money away
from every other part of the country that is a little annoyed
that the Chesapeake Bay may already have a preference, and,
therefore--but that was specifically designated, specifically
funded, specifically set aside.
The rest of the country is very concerned about the fact
that you may do more of these at their expense, whereas the
Chesapeake Bay, that was debated and set aside as a part of the
legislation in the Congress.
Mr. White. Understood, sir. And we could also add
California to that group--or not California per se, but the
CIG(b) section, which was the Air Quality Initiative that
Members here, remember, Mr. Cardoza, Mr. Costa, brought that
forward.
Mr. Goodlatte. Right. Those were all--I mean, I am not
quarreling with those as long as you stay within those limits.
And I am sure the gentlemen from California would agree with
me, as well. But when it comes to the rest of the pot of money,
then you have the whole country eyeing that pot and wanting to
make sure that you are not exceeding what the Congress intended
with regard to the set-asides.
Mr. White. If you will allow me just a moment, say, EQIP--
EQIP was created in 1996, and the funding level there was $200
million a year for a national program. And that was
prioritized; 65 percent of whatever money that was received was
prioritized in Geographic Priority Areas. And that caused a
huge backlash because the money wasn't distributed, it was
felt, fairly across the country.
So, in 2002, Congress--and I was loaned to Mr. Lugar at
that time--in the conservation title, those priority areas were
eliminated, and additional funds were put into EQIP. It went
from $200 million a year to an authorized level of $1.2
billion.
I was the State Director in Montana----
Mr. Goodlatte. I know my time has expired, Mr. Chairman,
but I just might make this one last point.
I understand that the Congress worked very hard to
accomplish that because of the fact that the program was so
extraordinarily popular. But the fact of the matter is, it is
extraordinarily popular in every part of the country, as far as
I know. And the Congress set aside specific areas that we
wanted you to emphasize, like the Chesapeake Bay, like the
program that we have in California. And then, with regard to
the rest of the funds, we did not authorize you to set up other
separate, special initiatives that would take money away from
other regions of the country that are represented around this
dais this morning that are concerned about making sure that
their farmers receive their fair share.
So I would like to think that you would be increasing that
money from the $200 million expenditure to the $1.2 billion
expenditure proportionately around the country to reflect that.
And if you would include that as a part of the report regarding
the demand and the supply that you are going to provide to the
Committee, I would appreciate it.
Thank you, Mr. Chairman.
Mr. White. Mr. Goodlatte, I admire and respect you, sir. I
think we are on firm legal footing, and we will address that.
The Chairman. The chair recognizes the gentleman from North
Carolina, Mr. Kissell.
Mr. Kissell. Thank you, Mr. Chairman.
And, gentlemen, we appreciate you all being here today.
Chief White, just a little bit of follow-up to what the
Ranking Member has said. You know, there is concern about how
the funds on EQIP will be used regionally. And this question I
had in my mind even before our conversations this morning,
about any oversights to North Carolina specifically.
But looking at more specific parts of the program, can you
enlighten us on dairy, any contracts that have helped, perhaps,
to the crisis we have with our dairy farmers with the EQIP
program?
Mr. White. Yes, sir. In fact, I became aware of an issue in
your district that you are aware of, with EQIP, that we are
working on that won't reoccur.
If you would look at--there is a payment limitation on EQIP
of $300,000, and the Congress gave us authority to waive that
under certain circumstances and go back to the $450,000 that
was in the previous bill. Out of these thousands and thousands
of contracts, we waived that 11 times, and most of those were
for, like, methane digesters for dairies. Now, I don't know if
they were specifically in your district, but most of the
payment limitation waivers were for methane digesters, and most
of those were on dairies. And we continue to work with dairy
farmers across the country on how to handle the ag waste.
Mr. Kissell. And one other program, and I don't know how
the acronym is pronounced, but AWEP, the water program.
Mr. White. Yes, sir.
Mr. Kissell. There seemed to be some indication that we
were going to try to spread that out through other parts of the
nation, and maybe there had been concentration in one part. Can
you, kind of, enlighten me on where we were and where we are
going with that program?
Mr. White. Yes, sir. AWEP is--we had 191 applications.
There was a request for proposals that went out; 191 came in.
They had, like, a triple technical review. Sixty-three were
approved in various parts of the country. The bulk of them,
however, were in California. And we are all aware of the
drought issues there and the water quality. So there was a
concentration of those in California, but the rest were
dispersed across the country.
Now, there is an issue that came up from another Member of
this Committee that we are addressing with the Agricultural
Water Enhancement Program that will come out in the new request
for proposals that will place increased emphasis on water
conservation as a priority.
Mr. Kissell. Thank you, sir.
And, once again, thank you for your quick reaction to the
situation that we talked about this morning in North Carolina.
But I do want to reemphasize that regional equity program. For
something that is very popular, there is a reason it is
popular. Thank you so much.
I yield back my time, Mr. Chairman.
The Chairman. The chair thanks the gentleman and recognizes
the gentleman from Missouri, Mr. Luetkemeyer.
Mr. Luetkemeyer. Thank you, Mr. Chairman.
Mr. White, thank you for being here this morning.
When I see my farm groups back home--I am from Missouri,
and I have some concerns about the funding plan that USDA has
with regards to hypoxia efforts in the Mississippi Basin and
the Gulf of Mexico.
As you are aware, Missouri is one of the groups that is
required to be in the Healthy Watershed Initiative. And it is
our understanding that funding for this initiative will be
implemented through the Cooperative Conservation Partnership
Initiative, conservation innovation grants, and potentially
under both the EQIP and the Wildlife Habitat Incentives
Program.
As you know, we have discussed this morning, there is a lot
of interest in the EQIP funds. And we have also had that
interest from the Missouri farmers and ranchers, as well. You
know, our concern is that funding for this hypoxia effort will
mean less money in the way of funding for our farmers and
ranchers. Can you tell us how you intend to fund this program,
where these funds are going to come from, and how accessible
they will be?
Mr. White. Okay. A couple of points about this. Missouri,
those 12 states, Iowa, the others, will select up to three
watersheds, eight-digit HUCs, hydrologic units. Those are like
250,000 to 1.25 million acres. So Missouri will pick those,
Iowa will pick them, Illinois will pick them, whomever. So
there is a lot of state control.
And you have to remember that, if you are from Missouri,
this is not going to be money taken away from Missouri. Mr.
Goodlatte mentioned his concern about money coming from other
places. We think that there is enough money in EQIP that we can
address these local needs across the country when you are
looking at putting $1.18 billion into that program this year,
and maybe be voting on the Agriculture Appropriations bill this
week, that we are not going to really short anyone.
And what we hope to do is to do a better job in some of
these nutrient loading areas. We are trying to do--and I didn't
call it hypoxia. This is a water quality initiative. In the
out-years, it may have an impact on Gulf of Mexico hypoxia. It
sometimes takes a long time for conservation practices to have
that ripple effect. But what we want to do is help producers
put the right amount of nutrients on--could be more, could be
less, could be different timing. But to focus on these kind of
issues in watersheds where we see the nutrient loading, we
think we can have a heck of an impact.
And I just do not believe that we are going to have a huge
problem in other parts of the nation by taking this money and
reserving it for this use, focusing it on this use.
Mr. Luetkemeyer. Okay. So you believe there is enough money
in the system, it won't impact other programs?
Mr. White. Yes.
Mr. Luetkemeyer. Okay.
Mr. White. Every year, we are in the position of shifting
money from state to state. Some states need more; some have
contracts drop out. You have to move money here and there.
There is a continual shift of funding. I think you do that
within the existent system we have, sir.
Mr. Luetkemeyer. Okay. Thank you.
Mr. Coppess, just a quick question for you. You indicated
some changes are coming in the CRP program. Would you be
willing to elaborate on those this morning just a little bit?
Mr. Coppess. Right. What we have in place now are the rules
for a series of the changes made by the 2008 Farm Bill, just
implementing those changes. We are not making anything
additional really above and beyond that, but it is simply
implementing the remaining pieces from the 2008 Farm Bill.
Mr. Luetkemeyer. Oh, okay. I misunderstood. I thought you
had some other changes that you were getting ready to spring on
us here that we were not familiar with or hadn't had any input
in. But basically you are just implementing the changes we
discussed before.
Mr. Coppess. Yes, sir. We got our hands full getting those
through. We won't be making any others.
Mr. Luetkemeyer. Okay. Thank you, sir.
I yield back. Thank you, Mr. Chairman.
The Chairman. The chair thanks the gentleman and recognizes
the gentleman from Alabama, Mr. Bright.
Mr. Bright. Yes, sir.
Chief White, just a couple of follow-up questions from my
colleague from North Carolina, when he was talking about the
AWEP program. Could you speak in more detail and provide us an
assessment on the program's implementation and how you
prioritize certain applications over the others?
Mr. White. Yes, sir.
Over 191 applications came in. The first screen was that
they were reviewed by technical experts. We brought agronomists
in from a center, hydrologists, biologists, and they reviewed
them. And they looked for whether they met the requirements of
the request for proposal. They had a bunch of different
criteria.
So that was the first screen. Then it went to a screen of
high-level NRCS employees at the deputy chief level who also
looked at it.
Now, this particular year, we did a third screen. Because,
out of the 191 that came in, this first level eliminated 50
percent. They said 50 percent did not meet the RFP requirements
and would not advance. So they had the program manager look at
those 50 percent, so they had a second look at them. And then
these other folks went through it again, and then I got that
list, and I pretty much went down that list.
Now, in respect to Alabama, there was an Alabama
application that was not funded in the initial one.
Mr. Bright. That is right.
Mr. White. And a couple of the additionally funded ones
dropped out, things went wrong, they withdrew, whatever. And
what I did then was I went back to the prioritized list, and
there was Alabama. So I pretty much went down the list after
the technical review.
Mr. Bright. Thank you very much.
And I stress once again, I am sure everyone around this
room today will stress the importance of water to each one of
their states. And Alabama is not unlike any one of these
states. Water is very--even in Alabama, we have a scarcity of
plentiful water. So, if you would, please continue to review in
great detail our applications for these funds.
Also, as you mentioned in your testimony, in Fiscal Year
2009 there were over 3,800 applications which were submitted,
and about 1,700 were awarded contracts. What determines an
application's eligibility or ineligibility? Is that detailed
with the tri-level screening that you just discussed?
Mr. White. Well, no. The 63 projects that were approved----
Mr. Bright. Sure.
Mr. White.--okay, once you get that project, then the
producers in there apply for EQIP. So that is where the
applications come from. And we had enough funding available
that first year to do 1,700 of them.
Mr. Bright. Okay.
One follow-up question, and we will change gears and
directions. I want to ask you about the Wetlands Reserve
Program, the WRP. And the WRP is another vitally program in my
district, Alabama District 2. And several of my constituents
have complained about a lack of transparency in the Geographic
Area Rate Caps land valuation process and claim a
discriminatory result based upon their county.
My staff has been in contact with both the state and
Federal NRCS staff, but we have not been able to make any
progress in determining a solution to this issue.
Furthermore, we have been informed that the counties
claiming discrimination have been offered no recourse or path
to appeal the land value they were given. And, for instance,
specifically, two counties in the same region, neighboring each
other, one county was given a $20 increase per acre and the
other given over a $300 increase per acre for the same year.
That concerns us, and we have asked for detailed explanations
of that.
It is my understanding that the 2008 Farm Bill included an
appeals process for the Geographic Area Rate Caps land
valuations, but it appears that recourse is, in certain
circumstances, being denied at the state level. Can you
elaborate on that a little bit? If you are aware of it,
elaborate on it.
Mr. White. I am more than aware of it, Mr. Bright.
Mr. Bright. Okay, good.
Mr. White. I have been contacted by your office, of course.
You have taken a great interest in this.
And this Geographic Area Rate Cap, which, of course, we
call ``GARCs''--it sounds like something is caught in your
throat--but there were errors made in Alabama in a couple of
counties. I think the county's name was Lowndes?
Mr. Bright. Lowndes County and Wilcox County, right. And
one of the poorest counties in the nation, quite frankly.
Mr. White. Yes, sir.
Here is the solution. The State Conservationist is going to
go back and redo those Geographic Area Rate Caps, okay?
Mr. Bright. Good.
Mr. White. So that is going to be redone. I will guarantee
that Alabama, those producers in that county have enough
acreage to allow them back, if they choose to, to move forward
into WRP. There are enough acres in the cap that Congress gave
us that we can do that. So any producer who felt that the
amount kept them out will have that option in Fiscal Year 2010,
which is what we are in. We are going to redo those GARCs.
Mr. Bright. Thank you very much, Chief. And thank you for
your testimony here and appearance here today.
And, Administrator, thank you also.
The Chairman. The chair thanks the gentleman and recognizes
the gentleman from Pennsylvania, Mr. Thompson.
Mr. Thompson. Thank you, Mr. Chairman.
Chief White, good to see you again.
I want to follow up on the number of applications my friend
from Alabama had talked about. And I know in your testimony you
talked about the increase in applications compared to Fiscal
Year 2008. And what is the Service doing to help accommodate
the workload increase? Are there adequate staff and resources?
Mr. White. You know, Mr. Thompson, the short answer is, no,
we don't have adequate staff resources.
The other--I mentioned the Streamlining Initiative. If we
can move forward--we are going to start implementing some of
that stuff in 2010--we are going to take some of the
administrative burden away from those field people, which will
have the effect of really adding more staff years.
The second thing, Mr. Thompson, is we are turning the
allocation process NRCS has used in the past on its head. In
the past, you would appropriate the money, and what we would do
is fund headquarters first. You know, you would fund the
headquarters and the centers. And then they had these
allocation formulas, and you would go to the state area and
then finally get down to the local level.
We are flipping that, Mr. Thompson. We have an initiative:
We are going to fund the field first, so there is not one
district conservationist, one soil conservationist, one
technician out there that needs to worry about their job. I
want them to worry about doing their job, not whether they have
a job. So the people on the sharp edge of the sword will be the
priority for funding, Mr. Thompson.
And we think that if the budget passes as proposed, we will
be able to actually get more money down to the field level and
fill some of those vacancies that are critical. And there are
some in your state that have been vacant for a long time, and
we would like to see those people put back in place to service
your producers.
The other thing, if we can do this, is to expand our
relationship with technical service providers and engage them
more on this effort.
Mr. Thompson. Okay. Well, I certainly applaud your efforts
at increased efficiency. I mean, we need to do more of that,
obviously, in government.
You talked about removing administrative burdens and more
efficiency. Is there an effort, then, to also do that for the
producers, the end-users, in terms of the paperwork, the
process, the fairly cumbersome administrative process? And at
times, frequently, I hear a lot of comments about that. Are
there efforts at improving efficiency there, as well?
Mr. White. Yes, sir. I mentioned that is a part of the
Streamlining Initiative. We want to make it easier for farmers
and ranchers to apply, to check their status, to do things on
their schedule, not our schedule. So that is a big part of
this.
Another big part of it is, with these technical service
providers, to get them engaged where they can do more work. You
know, we live in a security-conscious world, and we just don't
let anybody into the USDA computer systems. But we have awarded
a contract as part of this to affirm that it is going to do a
plug-in, where a technical service provider can reach through
the USDA system. And if you give that technical service
provider, if they can get your records, pull them out do their
plans, do their work, then they can go back and put them back
in without breaching any security. We think that is going to
have a huge impact as far as making that accessible and
transparent to technical service providers.
Mr. Thompson. That is great. I want to thank you.
Mr. Coppess, you stated that with the declining commodity
prices for wheat, corn, soybeans, other crops, interest in the
CRP program is, again, accelerating. It does seem to me that
some farmers enroll in the programs because they feel they have
no other choice. And I would like to get your thoughts in terms
of, are you aware of any instances where entering into
conservation programs have had negative effects on the farm's
overall productivity and profit?
Mr. Coppess. I do not, as I sit here today, know of anybody
that has had a negative impact on their farm or their operation
from being in these conservation programs. And, frankly, we
have seen a significant amount of interest, and it continues to
grow. Producers see a lot of benefit out of it. CRP has done
great wildlife enhancement and everything else that a lot of
producers seem to really see the benefits of. I don't know of
anybody that has complained in that regard.
Mr. Thompson. Okay, thanks.
And then just one additional question. Forestry has an
important role in my district, a real significant industry. And
you mentioned that the farm bill provided funding for tree
thinning. And, in my view, tree thinning, thinning is a very
important part of keeping a healthy forest, obviously, in
forest management.
Can you elaborate on those efforts and give us an update on
how that is going?
Mr. Coppess. Yes, the tree thinning provisions of CRP that
came through the 2008 Farm Bill, the changes for that, have
been implemented with the part of the regulation that was
published in June of this year.
So those processes are under way now. People are allowed to
take advantage of the program and utilize it to help thin out
forest, reduce forest fuel fire load, and improve the health of
the forest stands.
Mr. Thompson. Great. Thank you.
Thank you, Mr. Chairman.
The Chairman. The chair thanks the gentleman and recognizes
the gentleman from California, Mr. Costa.
Mr. Costa. Thank you very much, Mr. Chairman.
I have a number of questions, but I will continue from the
discussion that Congressman Goodlatte had with you with regards
to the EQIP program and the efforts on the 2008 Farm Bill.
It is my understanding--and you, by your own testimony,
stated that there was a tremendous demand, is that not correct?
Mr. White. Yes, sir.
Mr. Costa. Is it my understanding correctly that the
Administration requested a reduction in the allocation as it
was before the House Subcommittee on Appropriations?
Mr. White. Yes, sir, I believe so.
Mr. Costa. Why?
Mr. White. Sometimes priorities collide, Mr. Costa.
Mr. Costa. And which priorities were these colliding with?
Mr. White. Yours and the Administration's.
Mr. Costa. Well, I got that part. But what were the
priorities?
I mean, the only major legislation that I can think of in
the last Congress that we all agreed on was the farm bill and
enacted it. And I thought the Congress was pretty clear on
those major items. And the area with the EQIP program was one
of those areas that we had strong bipartisan support.
And it just seems to me that--I would like to better
understand where the Administration felt, where you felt, where
the Secretary felt, that there was a higher priority than the
money that we had determined that would be authorized for
appropriations for the EQIP program?
Mr. White. Yes, sir. That is a fair question.
My sense would be that EQIP is over a billion dollars. It
was felt that that is adequate to address the ongoing demand--
--
Mr. Costa. How is it adequate if you are acknowledging that
the demand was very wholeheartedly supported throughout the
country and that the demand exceeded the amount of dollars
available?
Mr. White. Well, I was the State Conservationist in
Montana. And, now, there is a backlog on EQIP with the
applications----
Mr. Costa. No, I understand. I am not interested in an
anecdotal story. What I want to know is what priorities that
you or the Secretary determined were a higher priority than the
EQIP program that you were attempting--I mean, what you are
telling me is you were shifting dollars. I mean, you had made
an internal determination that it was more important to put
dollars in another area--and I don't know what that other area
was--and, therefore, you requested the reduction of the moneys
allocated before the Subcommittee on Appropriations.
Mr. White. I can speak to the issue that we felt that the
EQIP funding was adequate. I cannot speak to what other issue
had priority, whether it was child nutrition or what.
Mr. Costa. Well, I would like you to provide a response to
the Chairman and to the Subcommittee; I think that is
appropriate. But I don't see how you can justify that the
funding was adequate if, in fact, you said the request for the
EQIP funding throughout the country far exceeded the dollars
that were available. It is not logical.
Let's move on. You were talking about the dollars available
for water conservation. As you know, we have a horrific drought
facing California. In my district, it is ground zero. We have
unemployment numbers of 28 to 32 to 38 percent in some of our
farm towns, and those are depression-like unemployment numbers.
What additional effort can you point to that we can provide
quick support for in water conservation that will be helpful?
Mr. White. Well, as previously mentioned, the Ag Water
Enhancement Program, we awarded----
Mr. Costa. No. We are participating in some part of it.
What additional support can you provide?
Mr. White. Well, what I am saying is that, of the 63 that
were awarded, 18 were in California. And they were to try to
address that need.
Mr. Costa. Are we going to be able to find some additional
funding?
Mr. White. Well, the whole AWEP thing we will see next year
on who responds to those requests for proposals.
Mr. Costa. Well, I am going to send you a letter as it
relates to that area, because we are not doing enough. We are
not doing enough. This Administration is not doing enough, in
my opinion. And we are working closely with all of you to deal
with the immediate crisis impacting the drought in California,
and I just want you to understand that clearly. I appreciate
those funds, the 18 projects that were awarded, but it is not
enough.
Mr. White. The other issue in your district--and I was in
your district this past May as part of the Agriculture Air
Quality Task Force. And you all have some photos there; one
looks like a big cloud. That is the smog in the San Joaquin
Valley.
Mr. Costa. No, we are quite aware of that.
Mr. White. And then you will see, also, some natural gas
generators that have a whole cut in the block because these
farmers, producers are under extreme regulation. And we put
something like $24 million of the CIG(b) money into helping
farmers comply with that.
Mr. Costa. That is helpful. I appreciate it.
My time has expired, but if there is another round, I would
like to go back to those methane digester issues with regard to
dairies.
Thank you, Mr. Chairman.
The Chairman. The chair thanks the gentleman and recognizes
the gentleman from Kansas.
Mr. Moran. Mr. Chairman, thank you.
Mr. Coppess, the most common complaint I receive from
landowners and farmers in Kansas as it relates to CRP is the
uncertainty of what FSA is going to do. Are there going to be
extensions? When is the sign-up going to begin? And it seems to
me that you all live, kind of, year to year at best. And
farmers like to plan a lot longer than they are able to do
under that scenario.
You indicated in your testimony that there are 31 million
acres of CRP, which is 1 million acres under the 32 million
acre cap. You indicated that the President's budget includes a
general sign-up in Fiscal Years 2010 through 2012, but you have
to do your environmental impact statement, which won't be done
until the summer of 2010.
It seems to me that indicates there is no general sign-up
until 2011, Fiscal Year 2011. What happens to the acres that
are coming out and--I guess, what is the plan?
Mr. Coppess. Right. Certainly, we will not be able to have
a general sign-up until after the rule comes out, which would
give us some time this summer or summer of 2010 to hold a
general sign-up if, in fact----
Mr. Moran. So a general sign-up is still possible in Fiscal
Year 2010?
Mr. Coppess. Yes, the potential is still there. The
contracts then would be signed and go into place beginning
Fiscal Year 2011, and payments out later that----
Mr. Moran. When will you know whether there is a sign-up in
2010?
Mr. Coppess. Well, at this point, while we are waiting on
the regulation to be published, we are evaluating that, as
well. But we won't know or be able to put anything forward on
our general sign-up until we have that part of the regulation
out. And that, as you mentioned, is awaiting the EIS.
So we are in an unfortunate time period of uncertainty, I
understand that, until we get that out. And we are working to
get that out as quickly as we can. In the meantime, we do have
other tools, like CRP, like continuous sign-up, like SAFE
Acres, that we are evaluating now how we can utilize those
between now and that time period, as well.
But a general sign-up is going to have to wait until we get
the rule done.
Mr. Moran. So, in the absence of a general sign-up, it is
those other tools you would use as an extension. How about the
million acres that were under the 32 million acre cap?
Mr. Coppess. Right. Well, we did the extension for this
year; we got a million acres back in, or thereabouts, through
the extension process. Then, yes, the Secretary's goal and our
goal was to use every bit of authority that we have now to keep
us right up to that 32 million acre cap or as close as we can
get, understanding we have to leave a little bit of it in
reserve in case sign-ups go over estimates or whatnot, so we
don't go above the gap. But our goal is to keep that as close
as we can to 32 million acres in the program.
Mr. Moran. One of the issues that landowners would love to
get resolved is the issue regarding haying and grazing. And now
we are haying and grazing once every 10 years instead of every
3. That came about as a result of a lawsuit that didn't appear
to me that USDA particularly fought hard.
Is there any expectation we could return to the 3 year
rotation?
Mr. Coppess. As I sit here today, I don't know what we can
do on the 3 year rotation. That is something we can look into
as we work through this second part of the regulation. And we
can hopefully provide you a better answer as we get that piece
of it through.
Mr. Moran. Do you see that as a desirable goal? Would you
like to get back to the 3 years, or are you satisfied with
where we are?
Mr. Coppess. I wouldn't want to commit to getting back to 3
years, understanding the history that has gone into it. I would
like to think we can find a way to navigate that better, where
we are addressing the interests of all the parties that have
concerns about it.
But going back to a 3 year, after everything that has
happened at this point, I just am unable to commit to it at
this point in time. But I do think it is something we can
consider how we best utilize our authorities to get the
conservation benefits out there, as well as work with the
producers.
Mr. Moran. Secretary Vilsack was in Nebraska with a town
hall meeting in which he commented, when asked about CRP
questions, as I understand what he said, that CRP is going to
be replaced with CSP anyway; CRP is a program of the past.
Is that a policy or is that something that USDA believes?
What was the Secretary talking about?
Mr. Coppess. No, sir. If I understand what he--and I wasn't
there for the comments. As I understand it, what we are talking
about is the ability, under the 32 million acre cap, we are
trying to maximize the conservation benefits for the dollars
and the acreage cap that we have with CRP. However, there are
other programs throughout USDA, like CSP, that may be an option
for the individual producer; if their land is expiring, they
can look at CSP to continue to get conservation benefits but
through a different program. So they are not programmatic.
Mr. Moran. USDA intends that CRP is around for a while
longer?
Mr. Coppess. Absolutely. We fully support CRP and will
continue to do so.
Mr. Moran. Mr. White, my time has expired. But I want to
thank you for visiting with me in my office about AWEP. I
notice other Members of this panel have concerns about the
program as well. I would remind you that, statutorily, language
in the farm bill indicates that quantity has priority over
quality. We had this discussion, and I want to make certain
that I state it again for the record and would encourage you to
get NRCS to approve a conservation practice for conversion of
irrigated farmland to dryland farmland. It was a program that,
this was a political compromise in the farm bill, and I was
part of that compromise. And, as I indicated to you in our
conversation, I am not sure that USDA understood or followed
not only the letter of the law, but, certainly, the
conversation that occurred in the farm bill discussions.
I thank you for your time the other day, and appreciate
your interest in helping solve water quantity problems,
particularly as we try to preserve the Ogallala aquifer.
Mr. White. Thank you, Mr. Moran.
Mr. Moran. Thank you, sir.
The Chairman. The chair thanks the gentleman, and
recognizes the gentlewoman from Colorado, Ms. Markey.
Ms. Markey. Thank you very much, Mr. Chairman.
Yes. I represent northeastern and all of eastern Colorado,
so I would like to continue a couple of questions on the CRP
program, Mr. Coppess. I understand that FSA has been holding a
series of meetings as part of your environmental impact
statement process. Is that right?
Mr. Coppess. That is correct.
Ms. Markey. Can you tell the Committee what you are
learning from these meetings and any concerns people have with
the operation of the program? And then, more specifically, out
of the just under 1 million acres that have accepted extension,
where in the country are they located?
Mr. Coppess. As far as what we are holding right now, these
are public comment meetings that are part of the EIS. I don't
have a summary of the comments or the concerns we have had.
That will be part of what is rolled into the EIS as it is
finalized and comes out in the final draft before the
regulation. And we are certainly hearing a lot of interest in
the program, continuing the program, and continuing the acreage
up to the cap. But specific comments I don't have at this point
in time, but we will have that as part of our final documents.
As far as where are the million acres that are not in the
program, I am not sure where those are distributed exactly
throughout the country. We have certainly seen land that has
expired pretty much throughout the country, and we have tried
to get their enrollment. Are you discussing the extension
acres?
Ms. Markey. Yes. The extension.
Mr. Coppess. I don't know if we have an exact breakdown of
where the extension was, but we can get that for you, for your
office here in writing and for the Committee.
Ms. Markey. I have one other question. Are county
governments able to utilize a 25 percent county acreage cap
waiver authority yet? And, if not, when do you envision this
authority being available?
Mr. Coppess. The 25 percent acre cap is part of the
second--part of the CRP that is requiring the environmental
impact statement. So we will not have those regulations out
until September of 2010 to be utilized thereafter.
Ms. Markey. Thank you, Mr. Chairman.
The Chairman. I thank the gentlewoman.
I recognize the gentleman from Louisiana, Mr. Cassidy.
Mr. Cassidy. A couple of things. I can't relate, I
apologize, but in south Louisiana, historically the Mississippi
River distributed as well as received tributes. Do you follow
what I am saying? Kind of like the Federal Government. Now,
part of our issue is, how do we restore in part the
distribution of the sediment from the Mississippi River to
rebuild our vanishing coastline? So my question is, in this
initiative, is it elastic enough that we not only attempt to
restrict sediment entering the river, but we also think
imaginatively about restoring its distribution of sediment,
which, by the way, would help our dead zone in the Gulf of
Mexico by taking some of the nitrogen phosphorus and putting it
out through marshes? Are you with me?
Mr. White. Yes, it does.
Mr. Cassidy. Second, I toured with the Army Corps of
Engineers. And if it ever seems that the Federal Government is
at cross purposes, sometimes it seems in the Mississippi, we
certainly are. So is there any attempt to coordinate with the
Corps, as they obviously are intimately involved with the
coastline, to take this program and work with them so that it
works for restoration as opposed to just being dumped out into
the Gulf?
Mr. White. Yes, sir. We are going to work with Interior,
with the Corps, EPA, whomever wants to.
Mr. Cassidy. Now, how is that process initiated? Is that
inherent in this, or is it going to be dependent upon good-
minded people making phone calls? Or is there no, in this
legislation, by golly, you show up or you are shot?
Mr. White. No. We are not quite that strident.
Mr. Cassidy. I have more confidence than that.
Mr. White. The way we are set up is Louisiana is going to
be pretty much in control of what gets done in Louisiana. So
you are going to see, from northern Minnesota, it is going to
look a lot different than what it is going to look in your neck
of the woods. And where those watersheds are, the practices
they use, things like that will be essentially under local and
state control, and we will look for our State Conservationists
down there to work with the Corps. I think they have a pretty
good relationship with all this. You know, we spend a fair,
goodly amount of money on hurricane cleanup.
Mr. Cassidy. Can I give you a specific example and make
sure, just to document in my own mind?
Mr. White. Yes, sir.
Mr. Cassidy. False River is an oxbow river which a thousand
years ago was cut off from the Mississippi. Grosse Tete Bayou
is a bayou which was formerly fed by the Mississippi River
running over the land and going down to the Gulf of Mexico.
Levees were built and the False River and Grosse Tete Bayou
were cut off from the river. But there is still farming
activity and sewage which dumps into Grosse Tete which then
clogs that up and inhibits its flow.
Now, it is part of the natural Mississippi River Basin, for
but for 150 years, Pointe Coupee Parish means ``cut-off'' in
French, and so it has been cutoff since the French discovered
Louisiana.
So I guess my specific question is, could we include that
basin in this effort even though technically it is not
connected with the Mississippi River?
Mr. White. Yes, sir. It could be. If the State of Louisiana
picks that as one of their watersheds, it would be. They are
not restricted to, it has to be adjacent to. A lot of it could
be----
Mr. Cassidy. I was told by my Corps people or was told by
Rob Wittman that the reason for the cross-budgeting in the
Chesapeake Bay initiative is that sometimes EPA would have a
program, the Corps would have a program, you would have a
program, and there was no metric to establish the success. The
cross-budgeting was specifically to force these agencies to
have common metrics so that if the EPA program was benefiting,
the Corps would know it, that sort of thing. And so I go back
to another question.
Aside from reassurances that everybody wants to do the
right thing, do we need a formal mechanism in the Mississippi
River that the Corps would absolutely, positively, on a formal
basis, issuing joint reports, work with you to make sure that
these projects maximize their benefit?
Mr. White. No, sir. I don't think we need a directive to
that. I think people working together, that is one of the
priorities that Secretary Vilsack wants internally in USDA, for
people, agencies to work across those silos we may have
developed. And that applies to working with other Federal
agencies as well.
If it becomes an issue, we will get back to you. I think
that we will have a cooperative working relationship with the
Corps and others. Specifically to the restoration of the
floodplain, part of this project is the Wetland Reserve
Enhancement Program.
Mr. Cassidy. I saw that. Now, does the state drive this, or
do you drive it? I mean, is the state saying, Corps, show up,
or do you say, Corps, show up? And I am not blaming it on the
Corps. I am just trying to cut through the kind of, oh, my
gosh.
Mr. White. We work primarily with private land owners. You
know, if you as a land owner want to enter your land, that is
who we would work with. On a higher level, we would try to
coordinate with other agencies to make sure that we are not at
cross purposes.
Mr. Cassidy. Okay.
I yield back. Thank you.
The Chairman. The chair recognizes the gentleman from Ohio,
Mr. Boccieri.
Mr. Boccieri. Thank you, Mr. Chairman. Two questions.
First, for Mr. White, I noticed in your testimony, sir, you
talked about the Great Lakes Restoration Initiative. I would
like to hear, if you could, you expound on how you will partner
with states like Ohio that have already taken initiative to do
research with respect to what we are doing on Ohio State
University and the funding stream that comes back to the
states? What does that mean, and will you help offset some of
the costs that have already been done by the states?
Mr. White. Okay. My understanding is for the Great Lakes
initiative, something like $475 million, and it is going to
EPA. Well, we have worked with EPA. And if the appropriation
passes and is signed into law, essentially we would get about
$34 million of that in those eight states, and it would be
disbursed in the various programs, like technical assistance,
like EQIP, like the Farm and Ranch Land Protection Program.
There are some of them. And we would look at the states, those
eight states working together, to say, well, you need more
EQIP; I need more WRP. And then we would work through our
regular processes. And when I first heard about this, I was
concerned about violating appropriations law, like we were
augmenting what you all had appropriated. But there is a
standard; there is some language that EPA has that we would not
be violating appropriations law by adding money to EQIP, or
WHIP, or whatever.
Mr. Boccieri. Do you know, Mr. White, if any of those
initiatives would include dredging? Is that something that
would--there are some channels that come into the Great Lakes
where we are finding that ships cannot pass.
Mr. White. No, sir. We don't do that. The dredging
activities are really in the province of the Corps of
Engineers.
Mr. Boccieri. Okay.
Mr. Coppess, I apologize if this question has been answered
already. But you said in your testimony, too, that the nation's
largest carbon sequestration program has been conducted on
private lands. Can you tell us how much has been sequestered,
and what type of processes they are using?
Mr. Coppess. Thank you, sir. I believe, as I understand it,
about 58 million tons have been sequestered. And that is
because you are taking--you are putting permanent cover on it,
and those plants then sequester the carbon into the soil. I
would be way out of my league if I tried to explain all the
scientific bits that went into how they describe that. We have
done some pretty significant analysis of it to get to that
number.
Mr. Boccieri. Are you teaming up with any agra businesses
that have done this research?
Mr. Coppess. That is a good question. I don't know exactly
who all we work with, but I can try to find out if we have a
list of those that we work with outside of the government on
that.
Mr. Boccieri. I would like to team with up with you. We
have the Ohio State Research and Ag Research and Development
Center in my district, and they are doing some remarkable
research there. I would like to team up with you on that as
well as make you aware of some of the things that Scotts is
doing. They just opened another facility in my district, and
they are from Ohio, Marysville, Ohio. They are doing some
really neat stuff with carbon capture. So I would like to team
up with you at some point.
Mr. Coppess. Great. We would welcome the opportunity to
work with you and the university. I know we do quite a bit with
Ohio State, to continue those efforts and continue to team up
on this. So I appreciate that.
Mr. Boccieri. Thank you Mr. Chairman. I yield back.
The Chairman. The chair recognizes the gentleman from
Michigan.
Mr. Schauer. Thank you, Mr. Chairman.
And thank you both for your testimony. I am from Michigan,
Michigan District 7, kind of the southern and central part of
the state. Our story is probably similar to some other states
but probably the worst of any, given our economy. Both of you
in your testimony talked about working with local partners,
state, county, and local. And our state budget has caused cuts
to our land-grant university, Michigan State University, in
some ways that help local farmers. Our county governments, that
also fund conservation districts, have had to make tough cuts.
So, the result is your partners are pretty severely weakened at
the local level. I wonder if you can talk about that; if this
title of the farm bill will help deal with that; or if we have
given you the ability here in this Committee and in Congress to
shore up local efforts so that agriculture isn't negatively
impacted?
Mr. Coppess. Thank you, sir. I think one of the best
examples we have at FSA of working with local and state comes
through the CREP programs, where the state and local folks
actually target areas they need to work on, and then we get
down there and work with them to make sure we are getting the
conservation benefits for the dollar.
It is certainly difficult, and the Chief mentioned all the
efforts that he has under way as far as field staff and
bolstering that. We are doing the same thing at FSA where we
need to focus on our field staff to get more effort and more
ability on the ground. I think that will help in the situation.
Of course, we face limited budget problems as well and whatnot.
So it is never easy to do, but we are trying as much as we can
through the authorities that we have.
I, sitting here today, wouldn't have anything additionally
we would ask for at this time, but I think that we can better
utilize what we have under CREP, under SAFE, under the public
access programs, as we get that implemented to work with not
just local institutions and entities, but continue to work with
the farmers and groups of farmers that are interested in
utilizing the programs that we have.
Mr. White. Mr. Schauer, there are a lot of opportunities
that you have provided in the 2008 Farm Bill that would allow
us to work cooperatively with state agencies, local agencies,
NGOs, whatever. In fact, there is kind of a directive there
that we are to aggressively go out and seek technical
assistance from sources where we may be deficient, like
specialty crops. Your state has specialty crops, a lot of them.
So we would look to form partnerships.
Another example would be the dam rehabilitation that this
Committee initiated several years ago on those old small
watershed dams that may need to be fixed up. We are going to do
a big assessment. I would like to see our states enter into
cooperative agreements, like with the state dam safety
officials, to get those engineers to come out, and we could pay
a goodly portion of that cost. So there are opportunities with
technical service providers, with NGOs, with local governments
where we can, to the extent our funding allows, enter into
agreements to get technical assistance for our producers.
Mr. Schauer. Thank you both. I just wanted to make sure you
are aware of the challenge that local communities are facing
and farmers are facing on the grounds. So you have good people
in our state, and I appreciate you making sure they are aware
and they are innovative as they are trying to support
agriculture. Thank you.
The Chairman. I thank the gentleman.
Chief White, in reference to the CSP program, with the
sign-up, how many do you think are viable? And, specifically,
do you think all 33 million acres will result in contracts?
Mr. White. No. We have the statutory limitation of 12.8
million acres are what we can enroll. And that would be like
your Fiscal Year 2009 enrollment. It does have a continuous
application process. We take an application right now. We are
hoping to have the next batching or cutoff date like in
January. So what we don't get this time would be eligible again
for ranking in January. And depending on what we get then, we
may do another one later on, or we may defer to 2011 when we
would have the new authority for another 12.8 million acres.
The Chairman. What about the viability, though, of the
people that sign up? The sign-up, what do you think of, is that
viable? What do you think about that?
Mr. White. Mr. Chairman, I was really pleased.
Now, obviously, with 21,000 applications, I don't have the
depth of detail or what kind of enhancements folks are looking
at as you would move from Maine to Hawaii. So we will have a
better sense of that once we look towards the end of this month
when they are ranked. But, one of the key things that the House
did during the conference on the farm bill was the bar, the
entry bar for the Conservation Stewardship Program. The House
was arguing that a producer should only have to meet one
resource of concern. I think the Senate was higher. And the
conference committee went with the House proposal, and I think
that opened it up to a lot more people. And, hence, we have had
a lot more interest. And a lot of that came from this
Committee.
The Chairman. Thank you.
I know Mr. Costa has a follow-up question. Does anyone on
the minority side have a follow up?
Mr. Costa.
Mr. Costa. You were talking, Mr. White, I believe about the
methane program and the participation of dairies around the
country. Specifically, it is my understanding, with a number of
pilot projects that I am familiar with in the San Joaquin
Valley, that they were participating. I don't know what the
split was in terms of utilization of both state and Federal
funds. But because, as you noted in your other comment, that we
have indeed air quality problems as a nonattainment area, the
air board indicated issues with these various methane digester
pilot projects, and there have been challenges in terms of the
continued operation of those.
One, are you aware of that? And two, if you are not, I
would like you to look into it. Because, my question is this: I
don't want the funding to be in jeopardy to the degree that
those that have been able to participate as we are looking at
Agriculture's role to play a part in renewable energies, if you
have other challenging circumstances, that we can be able to
continue that funding if we can work through that.
Mr. White. Mr. Costa, I had heard there were some issues
with methane digesters in the Valley. Is it NOX? Is
it methane? Do you know what the compound is that is causing
these?
Mr. Costa. My understanding is that it was NOX
and methane, both.
Mr. White. I will follow up on it. And can I get back to
you on that?
Mr. Costa. Sure.
Mr. White. Because that is an issue, because you would
think that you are producing green energy and you are taking a
waste product and turning it into energy, and it would be too
bad if that is causing an air quality issue that would shut you
down.
Mr. Costa. Well, we have certain requirements both by the
Federal EPA and the state EPA to achieve certain standards,
both with stationary sources of emissions and mobile sources of
emissions. We have done a tremendous job, I believe, in
ratcheting down those stationary sources of emissions. The
PM10 level has gone from PM10 to
PM2.5. So it is a tremendous effort that is taking
place. But I concur with your comment, but the air board is
still trying to figure out how they live with both the Federal
and the state requirements based upon the fact that we are a
nonattainment area.
Mr. White. And your ranchers and farmers are doing some
cool stuff. We are cost-sharing on a sprayer that would go
through an orchard, actually kind of a sonar radar device that
would turn the sprayer on and off. It could read where there is
a tree there. We can see a 40 percent reduction in the volatile
organic compounds just from that. So your producers are making
some tremendous things.
Mr. Costa. They are doing a good job. But under the
category of no good deed goes unpunished, I would like you to
get back to me on the other item.
Mr. White. Yes, I am familiar with that category.
If I could, on this drought thing, one of the people
sitting behind me is your California State Conservationist, Ed
Burton. And California gets about $58 million a year in EQIP,
and he took $3 million of that, and we were able to provide him
with another $1 million, and they did a special thing just to
help your drought-impacted producers.
Mr. Costa. I understand. We have lost about $1 billion so
far this year. We need more help.
Mr. White. It is amazing. It is stunning. When you and Mr.
Cardoza and Ms. Boxer on the 2008 Farm Bill were first talking
about this air quality money, I will be honest with you, I
thought it was kind of goofy until I saw it out there and I saw
what those producers actually--how they were regulated and what
was happening to them. And now I am a believer.
Mr. Costa. Thank you.
The Chairman. The chair thanks the gentleman and recognizes
the gentleman from Kansas, Mr. Moran.
Mr. Moran. Mr. Chairman, thank you.
I just wanted to follow up with Mr. Coppess. Again, in
2010, if you are unable to do a general sign-up, there is a
significant number of acres then coming out in 2010. What is
the plan for those acres?
Mr. Coppess. Correct. If we cannot do a general sign-up in
2010, again, I go back to the tools we have available. We used
extensions in the past to get some of those acres re-enrolled.
We would evaluate that again. We would look at CREP, the
Conservation Reserve Enhancement Program, that continuous sign-
up acreage potential, targeting certain initiatives. We are
currently evaluating a series of these different initiatives
that we might be able to undertake even now to take care or to
get at what looks to be about 700,000 acres that are under the
cap.
So we want to continue to push all of our authority to
utilize each bit of that so we get ourselves as close to the
cap as we possibly can. So, there, we have used extensions in
the past. We have SAFE. We have CREP, continuous sign-up.
Anything under there. And, of course, we welcome suggestions of
other ways that, if your producers think there might be a way
that we could utilize that existing authority and address the
needs out there, we would welcome the suggestion.
Mr. Moran. But none of that we are going to know until you
determine or when it is determined, when the environmental
impact statement is going to be completed. Is that where we
are? I mean, we cannot tell producers or land owners what is
going to happen until we know the time-frame of the completion
of the environmental impact statement. Is that right?
Mr. Coppess. Just on the general sign-up. SAFE, CREP,
continuous. We can utilize the authority we have now to get
those pieces moving.
Mr. Moran. But you are not going to need those authorities
if the environmental impact statement is complete and you are
doing a general sign-up?
Mr. Coppess. We would like to be able to still continue to
utilize those tools as well if we do a general sign-up. And
then our goal is to have out, to roll out a plan in the near
future that we can explain to farmers what we can do, and kind
of to target some of these initiative areas under the existing
authority. So they are not mutually exclusive. In fact, general
sign-up, if we do it, we continue to do SAFE and the others.
Mr. Moran. What is the status of the environmental impact
statement now?
Mr. Coppess. It is in draft form. We are holding a public
comment period or holding public meetings under this comment
period. That actually ends Friday, October 9. And from that
point on, and we take in all the comments on the various
alternatives that have been proposed by the company doing the
EIS; we take those in, evaluate them. From that, we then draft
the final EIS, which goes through that evaluation process,
publish that. And then once the final EIS is out, then we can
get the reg published immediately thereafter. In fact, we are
working on writing the regulation as we understand the
information coming in.
Mr. Moran. And you have penciled out the time-frame for
this process to be completed then. When is that?
Mr. Coppess. Right. As it stands now, the EIS would be
published in June of 2010. And then that will give us a week or
so after that, depending on how things go, we would then have
the regulation out.
Mr. Moran. Mr. Chairman, thank you.
Thank you, Administrator.
The Chairman. The chair thanks the gentleman and recognizes
the gentleman from Missouri, Mr. Graves.
Mr. Graves. Thank you, Mr. Chairman.
Mr. Chairman, my question is regarding EQIP in the farm
bill. We stipulated that 60 percent of EQIP dollars are
supposed to go to livestock producers, livestock practices, and
I was just curious how the Administration intends to get there,
and how you intend to maintain that once you get there.
Mr. White. Yes, sir, Mr. Graves. We achieve that on a
national basis. We continue, our plan is to continue what has
been done since 2002. We are not going to make any changes in
that. Basically, it has worked out really quite well on a
national basis. You have states like Wyoming who value--they
are going to spend 95 percent on livestock-related practices.
You have other states that won't meet it. But, nationally, we
have always been able to maintain that 60 percent, and we will
continue to do so.
Mr. Graves. I think it is important there is some concern
out there, but we want to make sure we will hit that.
The Chairman. The chair thanks the gentleman.
Any further follow-up questions? If not, the chair thanks
the witnesses for their testimony today.
And Chief White, we look forward to your response to the
question from Mr. Goodlatte and from Mr. Costa dealing with
EQIP.
Under the rules of the Committee, the record of today's
hearing will remain open for 10 calendar days to receive
additional materials and supplementary written responses from
the witnesses to any questions posed by a Member. This hearing
of the Subcommittee on Conservation, Credit, Energy, and
Research is adjourned.
[Whereupon, at 11:34 a.m., the Subcommittee was adjourned.]
[Material submitted for inclusion in the record follows:]

Submitted Letter by Hon. Tim Holden
September 8, 2009

Hon. Tom Vilsack,
Secretary,
U.S. Department of Agriculture,
Washington, D.C.

Farm and Ranch Lands Protection Program
Docket number NRCS-IFR-08013

Dear Secretary Vilsack,

We have all submitted comments on the Interim Final Rule on the
Farm and Ranch Lands Protection Program (FRPP) and understand that
those comments will be considered as the USDA Natural Resources
Conservation Service (NRCS) makes further changes to the Rule. However,
in addition to those comments, which reflect differences in
agricultural practices and regional perspectives, this letter is our
joint expression over key, common issues. In short, we ask that NRCS
give the states maximum discretion to implement FRPP as Congress has
now directed.
Simply put, protecting farmland for future agricultural use is of
utmost importance to every citizen of the United States. Going as far
back as the late 1970's, our states and commonwealths have taken action
to protect farmland so critical to maintaining the future viability of
our agricultural sectors and rural communities. To date, the
undersigned states are responsible for over 70% of all the acreage
protected under state farmland protection programs. Since 1995, we
acknowledge the important contribution of FRPP as a partner in our
mutual efforts, with our states receiving 53% of all funds distributed
by the program. We welcome NRCS as our partner and offer our
perspective to improve the quality, efficiency and effectiveness of
FRPP.
Unfortunately, we believe that the current Docket proposal does
little to correct serious problems that undermine the purposes of the
Food, Conservation, and Energy Act of 2008 (the 2008 Act) as they
relate to the Federal matching fund program to support the acquisition
of conservation easements on farmlands. The expectation among state
farmland protection programs was that the 2008 Act would open the door
to a more streamlined and effective Federal program with deference to
state interests. The two Docket proposals issued this year do not
accomplish that result and we conclude they will perpetuate the
obstacles to providing matching funding, which predated the 2008 Act
and which have served to frustrate and prevent greater state level
participation. These expectations derive from the Congressional record
and statutory amendments contained in the 2008 Act. We believe these
can be summarized as: FRPP was changed from a Federal real estate
acquisition program to a program that facilitates financial assistance
to non-Federal entities for conservation easement acquisitions; and,
FRPP was expanded beyond the purpose of protecting soils to protection
of agricultural use and related conservation values.

Contingent Right of Enforcement
We commend USDA on its clarification of the contingent right of
enforcement and decision to eliminate FRPP title standard requirements.
However, we urge USDA to not only eliminate title standard requirements
for cooperative agreements signed in 2009 and beyond, but to waive the
requirements for projects that remain under 2007-2008 cooperative
agreements. Further, we recommend that the Final Rule or FRPP policy
manual allow flexibility in the wording of indemnification and
environmental warranty language to address entity concerns and reduce
conflicts with state laws and constitutions. Where conflicts cannot be
reconciled, USDA should allow a waiver of the requirement.
Lastly, because of USDA's changed interpretation of the contingent
right of enforcement, we urge USDA to re-evaluate all elements of the
Interim Final Rule, policy manual and template cooperative agreement
for their consistency with the new interpretation. Since USDA is no
longer acquiring a Federal property interest but facilitating the
purchase of easements by FRPP partners, USDA must also consider whether
other aspects of program implementation that were predicated on the
earlier interpretation should be modified accordingly. In our
individual comments, we have suggested specific NRCS policies and
procedures which should be re-evaluated.

Certification
We strongly recommend that USDA develop a meaningful certification
process that provides significant and valued return to those entities
achieving certified status. Eligible entities should be allowed to
apply for certification. Certification criteria should include an
entity's experience with agricultural conservation easement
transactions (not just with FRPP projects), capacity to complete
acquisitions in a timely fashion and to effectively monitor and enforce
easement terms, and the necessary appraisal and title procedures to
safeguard the public's investment in the program. Once an entity is
certified, the following should apply:

Certified entities should be entitled to use their own
easement terms and conditions without limitation, and be
permitted to include or reject USDA language on indemnification
and environmental warranty at their option;

Certified entities should be entitled to use their own
project criteria and selection process;

NRCS title reviews of projects being done by certified
entities would no longer be necessary;

Appraisals would need to be consistent with state standards
and undergo review by the respective agencies. Appraisal
reviews at the Federal level have proven to be a major obstacle
to program implementation, therefore, NRCS appraisal reviews of
projects being done by certified entities would no longer be
necessary;

NRCS hazardous materials records searches, landowner
interviews and site visits would not be necessary.
Easement terms and conditions
Every entity should be allowed an opportunity to negotiate with
NRCS over the terms and conditions of their template conservation
easement deed, and NRCS should defer to that entity's terms and
conditions unless they fail to satisfy the three statutory requirements
of Section 1238I(g)(4). While it is reasonable to give the Chief
discretion to create standard minimum conservation deed requirements
(Section 1491.22), such requirements should be limited in scope to
ensuring that an entity's easement terms and conditions meet those
three statutory requirements. Further, certified entities should be
exempt from any minimum deed requirements.

Forest management plans
We strongly recommend that the rule be revised to eliminate the
requirement for a forest management plan. With regard to the IFR's
assertion that a forest plan is needed to document forest land
eligibility, we note that the rule essentially continues the program's
current requirements related to forestland eligibility-namely, that
forest land may not constitute greater than \2/3\ of the easement area.
We believe that eligibility determinations could be made in a number of
different ways, one of which might be a forest management plan. A
second method might be proof of the land's enrollment in a state's
current use or forestry assessment program. A third might be submission
of sales receipts or tax returns. Another might be certification by the
State Forester as provided in many use value assessment laws.
Therefore, we recommend that NRCS allow multiple means for providing
forest land eligibility under this category, not just through a forest
management plan, and recommend that state NRCS offices be given the
discretion to tailor guidelines regarding forest land eligibility to
the circumstances present in that particular state.

Impervious Surfaces
We believe that the only appropriate role for USDA with respect to
impervious surfaces is to ensure that eligible entities include in
their deed of easement an impervious surfaces limit that is
``consistent with the agricultural activities to be conducted'' under
the easement. Because this is a determination that is best made at the
state or local level, the appropriate standard should be left to the
eligible entity to develop. We recommend that USDA allow as permissible
impervious surfaces limits those that do not set numerical limits but
provide for a review and approval process for agricultural structures.
We welcome the contribution of our individual State Conservationists in
the development of appropriate limits and standards.

National ranking consideration and proposal selection
We recommend that USDA waive national ranking criteria for eligible
entities that can demonstrate that they have well-established program
criteria for scoring or ranking farmland protection projects, developed
with meaningful stakeholder input. Such a waiver should certainly be an
element of any certification process. If such a waiver were instituted,
we recognize that NRCS may need to compare projects within a state from
entities for whom the national ranking criteria has been waived and for
those for whom it has not. Accordingly, we suggest that NRCS identify
broad categories of ranking criteria that must be considered by
eligible entities in their criteria and selection process. USDA's own
LESA (Land Evaluation and Site Assessment) model can provide guidance
on criteria. These categories would ensure consideration of a common
set of resource and location issues such as soils, land type, farm
size, development pressure and proximity to other farms and protected
lands without imposing the specificity of nationally applied criteria
on experienced entities as now envisioned by NRCS.
In closing, we appreciate your consideration of each of the issues
outlined above and we request an opportunity to meet with you via a
conference call to discuss these matters in more detail. We have asked
the American Farmland Trust to work with NRCS Chief Dave White on
arranging an opportunity for us to speak with you in the very near
future. Thank you.
Sincerely,

[GRAPHIC] [TIFF OMITTED] T1131.014

F. Philip Prelli, Commissioner, Ed Kee, Secretary,
Connecticut Department of Delaware Department of Agriculture;
Agriculture;

[GRAPHIC] [TIFF OMITTED] T1131.015

Seth H. Bradstreet III, Earl F. Hance, Secretary,
Commissioner,
Maine Department of Agriculture, Maryland Department of Agriculture;
Food and Rural Resources;

[GRAPHIC] [TIFF OMITTED] T1131.016

Scott Soares, Commissioner, Don Koivisto, Director,
Massachusetts Department of Michigan Department of Agriculture;
Agricultural Resources;

[GRAPHIC] [TIFF OMITTED] T1131.017

Lorraine S. Merrill, Commissioner, Douglas H. Fisher, Secretary,
New Hampshire Department of New Jersey Department of
Agriculture, Markets and Food; Agriculture;

[GRAPHIC] [TIFF OMITTED] T1131.018

Patrick Hooker, Commissioner, Mark Forni, Deputy Director,
New York Department of Agriculture Ohio Department of Agriculture;
and Markets;

[GRAPHIC] [TIFF OMITTED] T1131.019

Dennis Wolff, Secretary, W. Michael Sullivan, Ph.D.,
Director,
Pennsylvania Department of Rhode Island Department of
Agriculture; Environmental Management;

[GRAPHIC] [TIFF OMITTED] T1131.020

Kenneth D. Ayars, Chief, Roger Allbee, Secretary,
Rhode Island Division of Vermont Department of Agriculture,
Agriculture; Food and Markets;

[GRAPHIC] [TIFF OMITTED] T1131.021

Gustave Seelig, Executive Director,
Vermont Housing and Conservation
Board.

Cc:

Dave White, Chief, Natural Resources Conservation Service;
Jon Scholl, President, American Farmland Trust.

______

Submitted Letter by Hon. Tim Holden; on Behalf of Steve Moyer, Vice
President for Government Affairs, Trout Unlimited
October 16, 2009

Hon. Tim Holden,
Chairman
Subcommittee on Conservation, Credit, Energy, and Research,
Committee on Agriculture,
Washington, D.C.

RE: Public Hearing to review the implementation of the conservation
title of the 2008 Farm Bill

Dear Rep. Holden,

Trout Unlimited submits the following letter for the record. Farm
Bill conservation programs are critical to the success of TU's
collaborative restoration programs on agricultural land. In the Potomac
River Headwaters of West Virginia, TU has worked with landowners to
install livestock exclusion fencing and revegetate streambanks on
dozens of miles of brook trout streams with the help of the Natural
Resources Conservation Service. In the Driftless area of the Midwest,
TU has helped direct $900,000 of WHIP funds to on-the-ground habitat
restoration projects that benefit aquatic species and advance the goals
of the National Fish Habitat Action Plan's Driftless Area Partnership.
In addition, more than $1.75 million will be invested in EQIP and WHIP
contracts in the Driftless area over the next 5 years thanks to a
Cooperative Conservation Partnership Initiative grant secured by TU. We
wish to highlight these on-the-ground conservation successes made
possible by the farm bill.
We also suggest some changes that would enhance the effectiveness
of farm bill conservation programs. The Cooperative Conservation
Partnership Initiative grant mentioned above will have a tremendous
benefit for the lands and waters of the Driftless Area. The impact of
the grant could be further strengthened, however, if a portion of the
grant could be used for staff or administrative support. The time spent
cultivating landowner participation and providing assistance during
project implementation is an essential component of a successful
project.
Two other factors hinder the effectiveness of farm bill
conservation programs. One is the new payment cap under WHIP ($50,000
per individual or legal entity per year). This cap unnecessarily
restricts our ability to complete habitat restoration projects in
cooperation with some landowners. The other is narrowing the WHIP
program's eligibility to only private agricultural lands, nonindustrial
private forest lands and Tribal lands. Allowing for at least a small
number of strategically-located projects on private nonagricultural or
on state or local public lands, as WHIP allowed prior to the 2008 Farm
Bill amendments, served the program and the nation well. These problems
could be addressed by enabling the Natural Resources Conservation
Service to use a waiver for special cases in order to implement
outstanding conservation projects.
Thank you for considering our input. Farm Bill conservation
programs have long been a powerful resource for advancing TU's mission
to conserve, protect and restore North America's trout and salmon
fisheries and their watersheds. Thanks to your good work on the 2008
Farm Bill these programs will continue to benefit fish, wildlife, and
local communities for years to come.
Sincerely,

[GRAPHIC] [TIFF OMITTED] T1131.022

Steve Moyer.
______

Submitted Questions

Responses from Jonathan W. Coppess, J.D., Administrator, Farm Service
Agency, U.S. Department of Agriculture
Conservation Loan Program
Question 1. The loan program was authorized to receive money in the
FY2010 approps bill. Are there rules ready to go to carry out a program
for FY10? How are you going to proceed with implementation?
Answer. Proposed regulations to implement the conservation loan
program are currently in the Agency clearance process. We project the
final regulations for the conservation loan program will be in place by
late summer 2010. FSA will begin processing conservation loan
applications as soon as final regulations are in place.

Question 2. Will FSA work with NRCS to make sure conservation
projects are being authorized and implemented?
Answer. Yes; any project funded with a conservation loan must be
part of a plan approved by NRCS. FSA will work closely with NRCS and
loan applicants to assure that projects are approved, funded and
completed.

Question 3. Do either of you see any demand for a direct and
guaranteed loan program to carry out conservation practices?
Answer. Yes, we anticipate that there will be demand for this
program. The statute makes the program available to any size producer,
even if credit is available from other sources. This is important,
because although conservation projects are valuable in a public sense,
they do not always provide an economic return to the producer. As a
result, sometimes producers and their lenders are reluctant to finance
large, expensive projects. The conservation loan guarantee program will
reduce some of the perceived risks for lenders and allow them to offer
better credit terms for conservation project financing. The direct loan
portion of the program will include more favorable financing terms that
will improve the economic viability of some projects for producers.
Grassland Reserve Program
Question 4. In the past, both agencies shared some responsibility
for this program. Is this still the case? If so, what are the roles of
each agency and how do you work together?
Answer. Yes, both FSA and NRCS share responsibility for GRP and the
specific roles and responsibilities are defined in the MOU. NRCS is
responsible for administering the easement acquisition process, while
FSA is responsible for rental contracts and payments. NRCS provides
leadership on regulation, and provides all on the ground technical
assistance for both easements and rental contracts. FSA manages
Financial Assistance funds, which includes making payments for rental
contracts and easement acquisition. Both agencies collaborate on policy
and day to day program management.

Question 5. We made some significant changes to GRP. Have there
been any surprises during implementation?
Answer. Demand for GRP remains strong, both for rental contracts
and easements. Only 4 eligible entities enrolled grasslands in FY 2009
using the new Cooperative Agreement option.

Question 6. We made some changes to the calculation of the
appraisal process for some easement programs. How many appraisals were
conducted for GRP? How has NRCS been calculating the appraisals? Is the
valuation fair?
Answer. Option Agreements to Purchase and Cooperative Agreements
were just signed for FY 2009 GRP easements enrollments. Twenty-eight
states used geographic caps and appraisals or area-wide market surveys
are currently being contracted this fall for the majority of the 68
easements funded to complete the new compensation process. Appraisals
shall comply with the Uniform Standard of Professional Appraisal
Practice.

Question 7. The 2008 Farm Bill split the amount of short term
contracts and long term easements. Which option has been the most
popular?
Answer. Both easements and rental contracts had higher demand
nationally than funding allowed us to purchase. The 60/40 split was
managed nationally to provide States flexibility to fund the highest
quality grasslands. Forty-one States utilized rental contracts while 30
States enrolled easements.
Conservation Reserve Program
Question 8. FSA has been holding a series of meetings on CRP as
part of your Environmental Impact Statement process, correct? Are you
able to tell the Committee what you're hearing about the future of CRP
and any concerns about the operation of the program at these meetings?
Answer. During the four weeks beginning September 14 and ending
October 9, FSA conducted public meetings in the following nine
locations: Spokane, WA; Great Falls, MT; Moorehead, MN; Manhattan, KS;
Springfield, IL; Oklahoma City, OK; Clovis, NM; Albany, GA; and
Harrisburg, PA. Over 400 interested members of the public attended
these nine meetings. As part of this public meeting process, an open
public comment period was established and closed on October 19. The
comments are being catalogued and will become part of the
administrative record for the Environmental Impact Statement as part of
the NEPA process.
The vast majority of the comments received thus far during this
open public comment period were very favorable to the CRP program as a
whole. Program participants, agencies, and NGOs recognize the great
benefits that CRP has produced over the last 20 years in protecting
valuable soil, water quality and wildlife habitat. Most comments are in
favor of raising the acreage limitation to the pre-2008 Farm Bill total
of 39 million acres or even increasing this to 40 million or more. Many
program participants expressed that participating in CRP is the most
beneficial use of their more marginal lands, both economically and
environmentally.

Question 9. It is my understanding that for several CRP practices,
some states are at or close to their limit on acres for these
practices, such as Upland Bird Buffers (CP-33) and State Acres for
Wildlife Enhancement (``SAFE acres'' or CP-38). Can you tell us the
status of these two practices in terms of acres available nationwide
and which states may be close to or at their limits and whether you're
looking at providing additional acreage to those states?
Answer. Interest in the Upland Bird Buffers (CP-33) initiative
remains very strong. The initiative has a national cap of 250,000
acres. The acres were initially allocated to the States based on
expected enrollment. Subsequent re-allocations have occurred, as
requested by States. However, the CP-33 initiative is close to reaching
it National cap. Several States are at, or near, their State enrollment
caps, including IA, MO, NE, SD, TX and TN.
The SAFE initiative has been very successful in several parts of
the U.S. The initiative has a national cap of 500,000 acres. Currently,
several States have pending offers that, if approved, exceed the
project allocations. FSA currently has several requests for allocation
increases. They are:

------------------------------------------------------------------------
State Project Acres Requested
------------------------------------------------------------------------
Mississippi Bobwhite Quail 5,000
South Dakota Western SD Grassland 20,000
Puerto Rico Puerto Rican SAFE 500
Washington Sage Grouse/Sharp Tailed 50,000
Grouse (NEW)
Idaho Columbian Sharp-Tailed 20,000
Grouse
Nebraska Upland Bird 5,000
North Dakota SAFE Habitat for Pheasants 20,000
Georgia GA Restoring Native Pine 5,000
Savanna
Iowa Gaining Grounds for 10,000
Wildlife in IA
---------------------
Total.............. 135,500
------------------------------------------------------------------------

FSA is actively exploring options to increase the numbers of acres
available for SAFE. However, increasing acres for SAFE and CP-33 would
be subject to administrative PAYGO.

Question 10. Can you tell us when the next general CRP sign-up will
be held?
Answer. The FY 2010 President's Budget assumes there will be a
general signup in Fiscal Year 2010. However, a date has not been
scheduled yet for the next general signup. The Secretary will decide
when to conduct a signup or signups as he deems appropriate.

Question 11. Where do things stand with implementing the transition
incentives for Beginning and Socially Disadvantaged Farmers for
expiring CRP acres?
Answer. The Transition Incentive Program is currently included in
the Environmental Impact Statement process for the second part of the
CRP regulation and we expect it to be completed in the Spring of 2010.
We are actively exploring interim approaches to ensure that beginning
and socially disadvantaged farmers can get utilize this important
opportunity.

Question 12. Out of the 985,527 acres who have accepted the
extension, where are they located?
Answer.

Status of 9/30/2009--Expiring General Signup CRP
Data as of 9/30/2009 (Acres)
------------------------------------------------------------------------
Originally
State Expiring 9/30/ Extended 3 or 5 Expired 9/30/
2009 Years 2009 a
------------------------------------------------------------------------
Alabama 43,007 9,729 33,278
Alaska 1,544 673 871
Arkansas 9,976 3,361 6,615
California 4,216 1,521 2,695
Colorado 719,452 309,102 410,350
Delaware 553 0 553
Florida 4,348 866 3,482
Georgia 31,257 6,372 24,885
Idaho 62,188 15,689 46,499
Illinois 32,216 5,221 26,995
Indiana 9,492 1,681 7,811
IOWA 88,458 8,252 80,206
Kansas 425,120 93,837 331,283
Kentucky 9,979 1,312 8,667
Louisiana 7,819 1,807 6,012
Maine 1,195 0 1,195
Minnesota 61,122 5,342 55,780
Mississippi 50,921 14,854 36,067
Missouri 40,096 9,471 30,625
Montana 197,509 58,199 139,310
Nebraska 151,835 36,129 115,706
New Jersey 13 0 13
New Mexico 40,840 12,365 28,475
New York 2,182 164 2,018
North Carolina 7,573 2,698 4,875
North Dakota 219,923 32,972 186,951
Ohio 10,299 1,355 8,944
Oklahoma 159,579 57,362 102,217
Oregon 20,312 5,960 14,352
Pennsylvania 4,822 330 4,492
South Carolina 27,314 8,936 18,378
South Dakota 232,593 42,699 189,894
Tennessee 12,791 4,010 8,781
Texas 779,899 214,167 565,732
Utah 64,792 14,689 50,103
Virginia 3,133 525 2,608
Washington 98,219 20,873 77,346
West Virginia 121 0 121
Wisconsin 36,359 6,186 30,173
Wyoming 97,372 35,017 62,355
-----------------------------------------------------
Total........... 3,782,683 1,044,610 2,738,073
------------------------------------------------------------------------
a Lands that were not offered or that declined the extension offer.

Question 13. How many states currently have a CREP? How many are in
the pipeline for approval? How many acres would be added to CRP if all
the states wanting a CREP were approved?
Answer. There are 43 agreements across 32 States.
South Dakota has a new CREP Agreement that was signed by the
Governor on October 9. FSA is currently evaluating Addendums to current
agreements in three other States (Colorado, Indiana, and Washington).
Upon approval of the four Agreements mentioned above, a total of
155,000 acres would be added to CREP.
There are three States that have expressed an interest in
submitting a new CREP Agreement (Colorado, Ohio, Pennsylvania,) and 4
States that have indicated an interest in modifying their current
Agreement (Idaho, Illinois, Kansas and Wisconsin). None of these states
have yet submitted formal proposals.

Question 14. You mention in your testimony 596 acres for the
Aquaculture Wetland Restoration practice and 75 acres for the Flooded
Prairie Wetland practice. Does this exceed expectation or was the
signup less than expected?
Answer. The program began in July. FSA believes it is too early to
assess if enrollment has met expectations.

Question 15. You mention in your testimony CRP is the nation's
largest carbon sequestration program on private lands. Do you have any
data on the amount sequestered or have that data broken down by state
and practice?
Answer. CRP is estimated to reduce greenhouse gases by around 56
million metric tons (CO2-equivalent) annually, including 48
million tons of carbon dioxide. However, these benefits cannot be
assumed to be permanent as CRP rental contracts are not permanent and
the producer retains the right to resume production on the land once
the CRP contract has ended.
Estimates of total carbon sequestered are developed using CRP
contract data. These data are sorted to identify CRP acres in grass,
wetlands, and trees. For grasslands and wetlands, estimates of the
carbon sequestered per acre are calculated from data in published
reports and from estimates developed by the Agricultural Research
Service and US Geological Survey. These data are merged with CRP
contract data to estimate total carbon sequestered by CRP grasslands
and wetlands. Because the carbon sequestered by forestlands varies by
tree species and the age of the stand, the CRP tree data are sorted by
region and age. US Forest Service estimates of carbon sequestered per
acre by region, tree species, and age are merged with the corresponding
data from CRP contract data. Total carbon sequestered is the sum of the
grassland, wetland, and forestland estimates.
The FSA GHG mitigation estimates have been reviewed by the USDA's
Office of the Chief Economist (OCE) and are viewed as the most
comprehensive set of estimates for a USDA conservation program. OCE
views these estimates as reliable and uses them as the best available
information regarding greenhouse gas mitigation by the CRP.
We have breakdowns by region, but not by individual States. The
reason for this is that the models used are not sufficiently detailed
to provide State-level estimates. FSA estimates carbon sequestration by
broad conservation practice categories: tree covers, grassland covers,
and non-forested wetland practices. The table below provides total CRP
greenhouse gas mitigation by region, along with sub-tables providing
carbon sequestered by tree, grass, and wetland practices.

CRP Greenhouse Gas Mitigation (million metric tons CO2 equivalent)
------------------------------------------------------------------------
2005 2006 2007 2008
------------------------------------------------------------------------
Total Estimated Net CO2 Sequestered
Northeast 0.52 0.57 0.60 0.61
Appalachian States 1.49 1.61 1.62 1.70
Southeast 5.30 5.37 5.36 5.16
Delta States 6.30 6.87 6.84 6.54
Corn Belt 7.34 7.88 7.78 7.32
Lake States 3.94 4.12 4.04 3.86
Northern Plains 10.55 11.32 11.35 10.34
Southern Plains 5.14 5.39 5.36 5.12
Mountain States 5.17 5.42 5.38 5.17
Pacific States 1.83 2.05 2.04 2.02
------------------------------------------------------------------------
United States Total Estimated Net 47.57 50.60 50.38 47.84
CO2 Sequestered
Mitigation from Fertilizer 5.14 5.30 5.43 5.12
Reduction
Mitigation from Energy Reduction 3.56 3.68 3.76 3.55
------------------------------------------------------------------------
United States Total Estimated 56.27 59.58 59.56 56.51
Greenhouse Gas Mitigated
------------------------------------------------------------------------
Total Net CO2 Estimated to be
Sequestered by CRP Tree Practices
Northeast 0.20 0.22 0.25 0.27
Appalachian States 0.88 0.98 0.99 1.12
Southeast 5.17 5.24 5.23 5.05
Delta States 5.86 6.36 6.32 6.06
Corn Belt 1.41 1.65 1.59 1.56
Lake States 1.50 1.61 1.54 1.49
Northern Plains 0.37 0.41 0.43 0.47
Southern Plains 0.18 0.26 0.26 0.25
Mountain States 0.30 0.34 0.32 0.31
Pacific States 0.19 0.23 0.24 0.25
United States, Total 16.05 17.28 17.17 16.83
------------------------------------------------------------------------
Total Net CO2 Estimated to be
Sequestered by CRP Grass Covers
Northeast 0.32 0.34 0.35 0.33
Appalachian States 0.58 0.61 0.60 0.55
Southeast 0.12 0.12 0.12 0.10
Delta States 0.42 0.49 0.50 0.46
Corn Belt 5.67 5.95 5.90 5.47
Lake States 2.17 2.23 2.21 2.07
Northern Plains 8.81 9.51 9.46 8.57
Southern Plains 4.94 5.12 5.09 4.86
Mountain States 4.86 5.07 5.05 4.85
Pacific States 1.62 1.81 1.80 1.76
United States, Total 29.52 31.25 31.07 29.01
------------------------------------------------------------------------
Total Net CO2 Estimated to be
Sequestered by CRP Non-Forest
Wetland Practices
Northeast 0.01 0.01 0.01 0.01
Appalachian States 0.03 0.03 0.03 0.03
Southeast 0.01 0.01 0.01 0.01
Delta States 0.02 0.02 0.02 0.02
Corn Belt 0.27 0.29 0.29 0.30
Lake States 0.27 0.28 0.30 0.30
Northern Plains 1.37 1.40 1.45 1.30
Southern Plains 0.01 0.01 0.01 0.01
Mountain States 0.01 0.01 0.01 0.01
Pacific States 0.01 0.01 0.01 0.01
United States, Total 2.00 2.07 2.14 2.00
------------------------------------------------------------------------

Question 16. Are county governments able to utilize the 25% county
acreage cap waiver authority yet? If not, when do you envision this
authority being available?
Answer. Section 2708 of the 2008 Farm Bill provided new authority
to exclude cropland acreage enrolled under continuous or CREP practices
from the county-based enrollment limitations (25 percent for cropland
and 10 percent for easement) with the concurrence of the county
government; or, in other words, waive the cap. This provision is
included in the second part of the CRP regulation that is currently
undergoing an Environmental Impact Statement. FSA will continue to work
to ensure that this authority be available as expeditiously as
possible.

Question 17. Are there any contract holders utilizing the tree
thinning cost-share assistance yet?
Answer. Although it is too early to have actual data, we understand
anecdotally that there is interest in tree thinning.

Question 18. Do you have any sense about what's happening to those
CRP acres whose contracts expired and were not extended? Are they being
plowed up for crop production or staying in grass?
Answer. About 2.8 million acres expired September 30, 2009. Some of
these acres could enroll in continuous CRP signup, other acreage will
remain in a conservation cover, and some acreage may return to
agricultural production. We don't have any estimates of the amount of
acres that will go into each of these three uses.

Question 19. FSA recently sent out a notice to state and local
offices taking down CRP maintenance payments again, after also sending
out a notice in April of 2008 reducing them. This time, some payments
were reduced to zero. Why these reductions? And where did these savings
in spending go? Or did OMB cut back on your apportionment for
maintenance payments?
Answer. The savings generated from reducing the maintenance payment
were used to offset the cost of two administrative actions, described
below, as required under the Administration's PAYGO policy.
Specifically, to offset the cost of the recent 3 and 5 year CRP
contract extension offer, FSA removed the $2/acre maintenance allowance
for all future general signup enrollments. Under the Administration's
PAYGO policy, any policy made at the discretion of the agency which
imposes increased costs must be offset. FSA felt it was important to
offer the extension because, without a FY 2009 general signup, these
contracts would have been forced out of the program.
The earlier, April 2008, maintenance allowance reduction was done
to offset the cost of several new and amended CREP agreements and the
cost of additional incentive payments designed to encourage enrollment
in CRP's wetland restoration practices.
Open Fields_Voluntary Public Access Program
Question 20. This is one of the only programs the Dept. has not
made any movement on. Why are there delays?
Answer. The Voluntary Public Access Program is important to the
Administration's implementation of the farm bill. FSA has expedited
developing the regulations and plans to implement the program in FY
2010.
FSA Computers and Payment Tracking
Question 21. Earlier this year, the computer issues at FSA were
impacting the ability to track direct attribution and other payment
limit requirements and making it harder to get payments out the door.
Can you describe the situation? And are things operating more smoothly
now?
Answer. FSA implemented a suite of web-based shared services for
Adjusted Gross Income (AGI), Direct Attribution, and Payment
Limitations just prior to CRP payment processing on October 2, 2009.
The implementation of the Direct Attribution (Payment Limitation) and
AGI requirements was successful for the CRP payment process. The CRP
payments are on schedule (over $1.4 billion of the CRP payments have
been delivered to Treasury for disbursement as of October 15, 2009).
Approximately 900,000 payments have been made, with 41,000 remaining.
Currently, FSA software for several key conservation processes are
in applications that reside on the legacy AS400 platforms rather than
on a web-based platform. This includes the process for recording CRP
contracts, CRP contract maintenance process, Grassland Reserve Program
benefits, and Conservation Cost Sharing benefits. Also, full nationwide
implementation of the Direct Attribution and the Payment limitation
rules is dependent on transforming Conservation business practices into
web-based and centralized data processes.
FSA is committed to the modernization of FSA program delivery and
software applications. IT Modernization for many FSA programs is
underway. FSA's MIDAS Investment will generate new modernized
applications for Farm Programs and produce streamlined FSA business
processes. FSA IT modernization supports scalable business and
technical architecture to provide flexibility in adding, modifying, and
retiring farm programs. Successful and timely completion of FSA
Modernization will require sufficient funding and resources over the
next few years.
Technical Assistance
Question 22. Have you discussed how your agencies can work together
to address workload issues out in the field offices? Can you explain
any overlap you have now in administering title two programs, both CRP
and non-CRP? For instance, does FSA have any role in payment limits?
And what is NRCS' role in CRP?
Answer. NRCS provides technical assistance for CRP, ECP, and GRP,
and may be expected to provide technical assistance for BCAP when the
program is fully implemented. Technical assistance includes
conservation plan development, practice certification, status checks,
and outreach. NRCS and FSA work closely together at all levels to
ensure consistent, timely delivery of programs.
FSA understands that workload issues exist in the field offices. In
certain instances, FSA utilizes third-party technical assistance
providers.
Waiver of Payment Limits
Question 23. We included provisions in the 2008 Farm Bill that
allowed for some of the payment limits and payment terms in
conservation programs to be waived. Have you received any waiver
requests?
Answer. For CRP, three AGI waiver requests have been received and
approved; two for Hawaii and one for New York.
Questions Submitted By Hon. Adrian Smith, a Representative in Congress
from Nebraska
Question 1. As you may know, I have previously contacted the USDA
regarding wind erosion as it relates to the Environmental Benefits
Index. In western areas of Nebraska, wind erosion is much more common
and destructive than water erosion. Unfortunately, water erosion is
usually given an elevated highly erodible land (HEL) grade when
granting acceptance into the CRP program. Considering the statutory
reduction in overall enrolled CRP acres, has the FSA considered
differentiating highly erodible land as it relates to water erosion
from highly erodible wind erosion lands, allowing only water to compete
against water and wind against wind?
Answer. The EIB process has been evaluated periodically in the past
to ensure that it is conducted as effectively as possible. FSA is
currently evaluating the EIB, and will continue to work alongside NRCS
throughout the evaluation. As part of that process, I would be happy to
meet with you or your staff to further discuss ways in which we can
make the EIB as effective and equitable as possible.

Question 2. Could you elaborate on the steps the FSA is taking to
assist landowners with expiring CRP contracts as they make the
transition?
Answer. FSA offered 3 or 5 year extension opportunities for
contracts covering 1.5 million acres out of the 3.9 million acres that
were scheduled to expire on September 30, 2009. Offering extensions to
contracts covering more than 1.5 million acres could have disrupted
ongoing continuous signups.
Offers were made to contract holders based on the highest
environmental benefits or land with the highest inherent soil erosion
potential.
Some of the expiring land could have been eligible for continuous
signup enrollment. This could include wetlands, buffer lands along
river and streams, and other practices. FSA notified all producers with
contracts expiring on September 30, 2009, of opportunities to enroll in
continuous signup, CREP, or Farmable Wetland Program.
Producers with highly erodible land, and wanting to participate in
many of USDA's programs, are required to develop a conservation plan.
Programs such as Environmental Quality Incentive Program and the
Grassland Reserve Program may be utilized to reduce some of the
environmental impacts of land use conversion.

Question 3. You stated in your testimony the combination of general
signups and ongoing continuous signups are expected to maintain CRP
enrollment at, or near, 32 million acres through 2012. If total
enrollment for 2010 is less than 32 million acres, will the FSA have
open enrollment? If so, will those with expired acres be allowed to re-
enroll, and what index will be used?
Answer. With enrollment as of October 2009 at 31.1 million acres,
there should be sufficient room to accommodate expected demand for
continuous signup enrollment. The CRP's continuous signup opportunities
are expected to continue to be available to producers throughout the
year. We are currently discussing how best to treat expired acres.

Question 4. In the past, both agencies shared some responsibility
for this program. Is this still the case? If so, what are the roles of
each agency and how do you work together?
Answer. Yes, both FSA and NRCS share responsibility for GRP and the
specific roles and responsibilities are defined in a Memorandum of
Understanding between the agencies. NRCS is responsible for
administering the easement acquisition process, while FSA is
responsible for rental contracts and payments. NRCS provides leadership
on GRP regulations, and provides all on-farm technical assistance for
both easements and rental contracts. FSA administers the financial
assistance funds, which includes making payments for rental contracts
and easement acquisition. Both agencies collaborate on policy and day-
to-day program management.

Question 5. We made some significant changes to GRP. Have there
been any surprises during implementation?
Answer. Demand for GRP remains strong, both for rental contracts
and easements. Only four eligible entities enrolled grasslands in
Fiscal Year 2009 using the new Cooperative Agreement option.

Question 6. We made some changes to the calculation of the
appraisal process for some easement programs. How many appraisals were
conducted for GRP? How has NRCS been calculating the appraisal? Is the
valuation fair?
Answer. Option Agreements to Purchase and Cooperative Agreements
were just signed for Fiscal Year 2009 GRP easement enrollments. Twenty-
eight states used geographic caps, and appraisals or area-wide market
surveys are currently being contracted this fall for the majority of
the 68 easements funded to complete the new compensation process.
Appraisals must comply with the Uniform Standard of Professional
Appraisal Practice.

Question 7. The 2008 Farm Bill split the amount of short term
contracts and long term easements. Which option has been the most
popular?
Answer. Both the easement and rental contract components of GRP had
demand that outstripped available funding. The 60/40 split between
rental contracts and easements was managed nationally to provide States
flexibility to fund the highest quality grasslands. Forty-one States
enrolled producers in rental contracts and 30 States enrolled
easements.
Responses from Dave White, Chief, Natural Resources Conservation
Service, U.S. Department of Agriculture
Agriculture Management Assistance Program
Question 1. With the addition of Hawaii to the list of eligible
states receiving AMA program funds, have other states expressed an
interest in the AMA program? If so, how many and which ones?
Answer. Yes. During drafting of the 2008 Farm Bill, Idaho and
Virginia had been mentioned for possible inclusion in AMA. We have not
heard about any interest since passage of the farm bill.

Question 2. AMA is split among three agencies and in the past there
has been some concern about how that money was being split. Can you
please give us a breakdown on how the money is currently being divided
among AMS, NRCS, and RMA?
Answer. The 2008 Farm Bill statutory language clearly states how
fiscal year funds are to be divided among AMS, NRCS and RMA. The
language in Title II of the 2008 Farm Bill, Section 2801 (c) states
that no less than 50 percent of available fiscal year funds shall go to
the Natural Resources Conservation Service (NRCS), 40 percent to the
Risk Management Agency (RMA), and 10 percent to the Agricultural
Marketing Service (AMS).
Environmental Quality Incentive Program
Question 3. During the last farm bill there was a lot of interest
in the formula used to distribute EQIP funding, and how we could ensure
funding was allocated more regionally. What steps has NRCS taken to
make sure some regions do not receive a majority of the money?
Answer. With the help of external recommendations, NRCS improved
the EQIP allocation formula (along with a number of other program
allocation formulas) in several areas in Fiscal Years 2007 and 2008:
Optimizing Factors--NRCS has optimized the number of factors in the
allocation formulas to increase transparency and understanding as well
as better address program priorities and statutory intent. This
includes both eliminating factors that were redundant and adding new
factors where appropriate.
Consistency--NRCS has worked to ensure consistency in formulas for
like programs, using the same factors and data where appropriate.
Data Definitions and Sources--NRCS has worked to ensure that the
most appropriate and current validated data, with common and agreed
upon definitions, are the basis of our allocations formulas. Data comes
from credible sources with nationwide data sources.
Improved Documentation--In an effort to increase transparency and
facilitate understanding of our allocations formulas, NRCS has worked
to improve the written explanations of our formulas and methodologies
for Fiscal Year 2009.
Enhanced State Specificity--NRCS has incorporated state-specific
data, including NRCS Activity Based Cost (ABC) data, to capture
differences in state technical assistance requirements for some
factors.
Cost of Program Model--NRCS is incorporating new data from its Cost
of Programs Model to determine financial and technical Assistance
proportional requirements for mandatory conservation programs.
Outcome-Based Performance--Using the GAO EQIP Audit, (September 22,
2006) as a guide and considering external recommendations, NRCS has
incorporated outcome based performance measures where possible in
allocation formulas. As other data on environmental outcomes becomes
available, it will be evaluated for possible inclusion in the program
formulas.
Factor Weighting Methodology--To increase transparency, NRCS
utilized ``paired comparison,'' a scientifically based methodology, as
part of the process to determine program formula factor weights.

Question 4. During the last farm bill there was a lot of discussion
about the amount of carve outs on EQIP. For example, a percentage is
used for beginning farmers and ranchers, organics, and CCPI. In your
opinion, has this had a negative impact on the overall program and the
ability to get money in the hands of producers?
Answer. The use of EQIP funds for special carve outs has had no
negative impact on the overall program. Funds targeted to groups such
as Beginning Farmer/Ranchers and Organic growers provide program
resources to producers who traditionally have not participated in USDA
programs. The CCPI program provides funds directly to producers to
achieve EQIP and WHIP program objectives, and has the added benefit of
leveraging resources from partners, adding value to getting
conservation on the land. Leveraged resources from partners through
CCPI allowed the agency program funding to actually buy more
conservation than if the program had been implemented independently.
The total amount of Fiscal Year 2009 EQIP program funding obligated
through CCPI was approximately $18 million, representing less than two
percent of the total EQIP financial assistance available. We feel we
have struck the right balance between the base EQIP program and special
initiatives that have the potential to have a focused impact on
critical natural resource concerns.

Question 5. We included an organic provision in EQIP. Have you seen
a great deal of interest in this component? Why or why not?
Answer. Yes, there was a great deal of interest in the organic
component of EQIP. We received 2,368 applications and funded 1,203
contracts. We were able to obligate $30,122,668 to producers under this
initiative. However, the pilot year of the organic initiative was not
without its challenges, including an abbreviated signup, new customer
unfamiliarity with NRCS contracting processes, and a nationwide mosaic
in the familiarity of NRCS staff with organic production. Many of these
issues are being addressed for Fiscal Year 2010. We are working with
our organic partners to make improvements to our organic initiative
delivery.
Nationally, over 2,200 applications were received from organic
producers, indicating that a significant number of growers have taken
advantage of this new initiative. Considering that there are
approximately 10,000 certified organic growers in the U.S., the total
number of EQIP organic applications represent approximately 22 percent
of certified organic growers, which we feel is a reasonable indicator
that the effort to reach organic growers was successful.

Question 6. The Conservation Innovation Grant (CIG) was authorized
as part of EQIP. How many applications did you receive as part of the
last solicitation? How many were you able to fund?
Answer. 391 applications were received and we were able to fund 55
applications.

Question 7. What has been the most popular component of the CIG
grant money?
Answer. In Fiscal Year 2009, water quality and wildlife habitat
were the resources concern areas most popular.
Fiscal year 2009 CIG applications by resource concern category:

Water Quality--Livestock: 43

Water Quality--Non Livestock: 41

Wildlife Habitat: 39

Soil Resources: 30

Energy Resources: 27

Atmospheric Resources: 19

Water Quantity: 19

Forest Health: 18

Grazing Lands: 17

Question 8. We changed the ground and surface water component in
EQIP to an enhanced agriculture water enhancement program (AWEP)
because the money was going to one specific part of the country. Have
the changes we made helped disperse the money across the country? Has
USDA used the priority areas as outlined in the report language? How
has this had an impact on the funded applications?
Answer. Funding to support AWEP proposals was available to partners
throughout the U.S. Priority area information included in farm bill
language was incorporated into the ranking and evaluation processes
used for Fiscal Year 2009. Over 190 proposals were submitted from
partners throughout the U.S. and 63 projects in 22 States were approved
for funding. Over 1,700 program contracts were obligated through AWEP.
These contracts addressed water conservation and water quality issues
on over 488,000 acres. We feel that the new AWEP program has addressed
more producer concerns in a larger area than the previous Ground and
Surface Water Conservation Program (GSWC) due to increased program
funding, and also because AWEP leverages additional funding and
technical resources from partners to help get conservation on the land.

Question 9. The farm bill included mandatory funds to be dedicated
towards air quality. How has that money been spent? Has it been spent?
Answer. Yes, the air quality funds have been obligated in program
contracts as required by statute authority. Nearly all of the
$33,825,000 in financial assistance funding has been obligated through
EQIP in approximately 900 contracts to address significant air resource
concern issues. Financial and technical assistance funds were focused
on states and counties that EPA has designated as non-attainment areas.
Producers will be implementing practices in two-to-ten year contracts
to help reduce particulate matter and ozone related pollutants
generated from agricultural operations.

Question 10. How many EQIP contracts (and how many dollars) were
granted to dairy producers in 2008? What proportion of the total EQIP
contracts were invested on dairy farms?
Answer. For Fiscal Year 2008, 2,614 contracts were approved for
$99,310,497 to dairy producers. During Fiscal Year 2009, 2,162
contracts were approved for $90,795,437 to dairy operations. For Fiscal
Year 2009, approximately 6.8 percent of all EQIP contracts were
associated with dairy producers.

Question 11. How many new practices or practice modifications will
NRCS be publishing in 2010 to improve sustainability and reduce
greenhouse gas emissions?
Answer. The following new and modified standards are scheduled for
2010 to address sustainability and greenhouse gas emissions:

(316) Animal Mortality Facility

(317) Composting Facility

(328) Conservation Crop Rotation

(590) Nutrient Management

(367) Roofs and Covers for Animal Waste

(313) Waste Storage Facility

(359) Waste Treatment Lagoon

(550) Range Planting

(390) Riparian Herbaceous Cover

(512) Forage and Biomass Planting

(595) Integrated Pest Management

(366) Anaerobic Digester

(601) Vegetative Barrier

(511) Forage Harvest Management

(603) Herbaceous Wind Barriers

(371) Airflow Filtration and Scrubbing

(372) Combustion System Air Emissions Management

(373) Dust Control on Unpaved Roads and Surfaces
Wildlife Habitat Incentive Program
Question 12. We changed the eligibility requirements for WHIP in
the 2008 Farm Bill to ensure payments were going to producers and not
country clubs or golf courses. How has this changed impacted the
overall program?
Answer. NRCS understands the rationale for the changes to WHIP in
the 2008 Farm Bill. The major changes--restricting the program to
private lands and limiting participants to $50,000 per year--have had
unintended consequences for the program, however. In particular,
aquatic habitat projects such as dam removals and fish passages, have
been stifled. Because many of these conservation projects are carried
out on public lands, despite the benefits they may accrue to private
landowners, they are now ineligible for WHIP assistance.
Although public land projects represented only 6 percent of the
contracts between 2005 and 2008, NRCS and public partners were able to
develop significant wildlife habitat with the implementation of 57 fish
passage projects. These projects benefit the entire nation since the
public generally has access to these lands and they open up hundreds of
miles of streams to aquatic wildlife that benefit all landowners along
the water courses.
All WHIP planning, conservation construction activities, practices,
or work on stream or river courses, which would occur below the
ordinary high water mark in 16 States and below the low water mark in
an additional 12 States (a total of 28 States), have been affected due
to the public ownership status of these streambeds. An important point
here is that potential participants and beneficiaries are private
landowners on private land, but the stream or river courses that go
through their properties are considered public land. There are at-risk
and federally listed threatened and endangered fish and wildlife
species that could benefit from these potential projects.
Amending the 2008 Farm Bill to reestablish the public land
eligibility criteria for WHIP would enable NRCS to use the program to
provide significant public and private landowner wildlife benefits,
particularly in the east and in aquatic areas.
Farmland Protection Program
Question 13. Due to the change in the contingent right of
enforcement and title standards, do you plan to reevaluate the
applications or cooperative agreements that were made while the old
rule was in effect?
Answer. The parcels enrolled before the 2008 Farm Bill was enacted,
but not yet completed, were acquired by the Secretary of Agriculture
under the 2002 Farm Bill. Those parcels are being acquired only after
passing title review by the Office of the General Counsel utilizing the
Department of Justice title standards. That requirement is a
requirement of all Federal land acquisitions. The Attorney General has
delegated the title commitment review to the Office of the General
Counsel for USDA acquisitions.
The applications from which parcels were selected for funding
before the 2008 Farm Bill was enacted will not be re-evaluated. The
contingent right of enforcement is not relevant to those parcels. The
terms of the cooperative agreements are linked to the farm bill and
regulations that were in effect at the time that the funds were
obligated.

Question 14. We established a certification process for FPP in the
farm bill. Have many sought certification? Why or why not?
Answer. The 2008 Farm Bill directed the Secretary to certify
eligible entities directly. NRCS established criteria for
certification, which are: (a) an eligible entity has to have closed 50
percent of its easements within 18 months of fund obligation; and (2)
that the eligible entity has to have demonstrated that proficiency over
at least 50 enrolled parcels in FPP. The eligible entities' performance
data was analyzed as of October 1, 2008 and seven eligible entities
qualified for certification. The seven entities had enrolled 32 percent
of all of the parcels ever enrolled in FPP. The certified entities had
demonstrated a closing efficiency of 72 percent; the other eligible
entities with at least 50 enrolled parcels had only demonstrated a
closing efficiency of 32 percent.

Question 15. One of the major changes we sought to eliminate in the
2008 Farm Bill was the additional title search. Can you tell us today
that additional title standard requirements are eliminated?
Answer. There will not be a title commitment review by the Office
of the General Counsel to Department of Justice title standards on
parcels in the 2009 cooperative agreements. Because FPP must limit non-
agricultural uses, NRCS staff will review title commitments to ensure
that non-agricultural uses are not permitted by an encumbrance to the
title and that all liens are subordinated.
The right of enforcement is meaningless if there are encumbrances
on the title that permit non-agricultural uses. OGC review of title
commitments of parcels funded in 2006-2008 uncovered many title
commitments with encumbrances and liens that were not subordinated. The
Rights of the United States wouldn't have been enforceable if those
title encumbrances had not been subordinated to the terms of the
conservation easement deed. Landowners could have engaged in non-
agricultural uses in violation of the farm bill because USDA had failed
to have the encumbrances and liens subordinated.

Question 16. The 2008 Farm Bill included language on impervious
surfaces. Can you tell us how NRCS is proceeding on how to set or
evaluate the appropriate percentage for impervious surfaces?
Answer. NRCS has revised its model impervious surface limitation
waiver process to permit impervious surface up to 10 percent. The
factors are the same as the factors in the old process, but the process
is re-scaled so the top percent impervious surface allowed is 10
percent. Parcels will be evaluated on a parcel-by-parcel basis.
Cooperating entities will be able to propose their own waiver
processes. State conservationists will have the authority to review and
approve the processes, but they must be applied to parcels on a parcel-
by-parcel basis.
Chesapeake Bay Program
Question 17. We established this program in the 2008 Farm Bill. Can
you tell us what the level of producer interest has been?
Answer. Producer interest has been strong. There were 2,037
applications in Fiscal Year 2009. With the available funding, we were
able to fund 41 percent, or 826, of those applications.

Question 18. In 2009, there was $23M authorized for this program.
How was the money spent?
Answer. NRCS State Conservationists in the six Bay Watershed
States, with the help of State Technical Committees, selected priority
subwatersheds. Producers in these subwatersheds received additional
ranking points for their applications. State Conservationists also
selected priority practices to be highlighted for the CBWP. The top
seven conservation practices in Fiscal Year 2009 were:

Residue and tillage management, notill/striptill

Nutrient management

Cover crop

Conservation crop roatation

Fence

Grassed waterways

Heavy use area protection

67 percent of CBWP funding was obligated for these seven practices.

Question 19. Can you explain how the Department funds the
Cheasapeake Bay Watershed Program? In your testimony you say that $23
million in funds were used from the EQIP program, does that mean $23
million from the Bay Program were used through the EQIP program or that
$23 million of EQIP money was used.
Answer. $23 million were apportioned specifically for the CBWP and
were administered through EQIP.
Grassland Reserve Program
Question 20. In the past, both agencies shared some responsibility
for this program. Is this still the case? If so, what are the roles of
each agency and how do you work together?
Answer. Yes, both FSA and NRCS share responsibility for GRP and the
specific roles and responsibilities are defined in a Memorandum of
Understanding between the agencies. NRCS is responsible for
administering the easement acquisition process, while FSA is
responsible for rental contracts and payments. NRCS provides leadership
on GRP regulations, and provides all on-farm technical assistance for
both easements and rental contracts. FSA administers the financial
assistance funds, which includes making payments for rental contracts
and easement acquisition. Both agencies collaborate on policy and day-
to-day program management.

Question 21. We made some significant changes to GRP. Have there
been any surprises during implementation?
Answer. Demand for GRP remains strong, both for rental contracts
and easements. Only four eligible entities enrolled grasslands in
Fiscal Year 2009 using the new Cooperative Agreement option.

Question 22. We made some changes to the calculation of the
appraisal process for some easement programs. How many apprasials were
conducted for GRP? How has NRCS been calculating the appraisal? Is the
valuation fair?
Answer. Option Agreements to Purchase and Cooperative Agreements
were just signed for Fiscal Year 2009 GRP easement enrollments. Twenty-
eight states used geographic caps, and appraisals or area-wide market
surveys are currently being contracted this fall for the majority of
the 68 easements funded to complete the new compensation process.
Appraisals must comply with the Uniform Standard of Professional
Appraisal Practice.

Question 23. The 2008 Farm Bill split the amount of short term
contacts and long term easements. Which option has been the most
popular?
Answer. Both the easement and rental contract components of GRP had
demand that outstripped available funding. The 60/40 split between
rental contracts and easements was managed nationally to provide States
flexibility to fund the highest quality grasslands. Forty-one States
enrolled producers in rental contracts and 30 States enrolled
easements.
Wetland Reserve Program
Question 24. Under the WRP and other easement programs, the farm
bill made changes in the statutory language to how appraisals are
handled. Do you have a sense of how your staff in the field are
implementing this provision? Are they using appraisals or one of the
other methods spelled out in the bill?
Answer. Although we did not reach our acreage goal of 250,000
acres, our enrollment of more than 179,000 acres was more than twice
the enrollment in Fiscal Year 2008. Much of that increase is due to the
use of the new easement compensation procedures authorized in the 2008
Farm Bill. These procedures are used throughout the country.
Essentially no appraisals were obtained for WRP parcels in Fiscal Year
2009.
States use several methods to arrive at their easement compensation
values. The first step in the process is to determine the market value
of the land. Almost all states utilize the area-wide market analysis or
survey option to determine market value. Once market value of the
unencumbered land is determined, State Conservationists, with the
advice of the State Technical Committee, determine the Geographic Area
Rate Cap which represents fair compensation for the easement rights
being acquired.
The use of geographic-based compensation procedures allows
producers to know immediately what they will be offered as compensation
for the easement. This saves both NRCS and producers time in the
enrollment process.
Conservation Stewardship Program (CSP)
Question 25. In the proposed CSP rule, there is a discussion about
the difficulties that the statutory ``constraints'' posed to those
trying to model the outcomes on the program and mentioned that these
same constraints will pose challenges in implementing the program as
well. Can you tell us what these ``constraints'' are? Does it include
the average per acre in the statutory language?
Answer. The constraints, referenced in 2008 Farm Bill Section
1238G(d), are the acreage limitation of 12,769,000 acres for each
fiscal year, and also the need to manage the program to achieve a
national average rate of $18 per acre, which includes the costs for all
financial assistance, technical assistance, and other associated
expenses. Arriving at a conservation performance payment rate that will
achieve the national annual acreage enrollment goal at the designated
average costs per acre mandated in legislation will be a challenge
given the variation of producers' baseline resource conditions and
demand for enhancements. To address these constraints, NRCS is using
the first ranking period for ``payment-rate discovery'' to arrive at a
uniform payment rate per conservation performance point by eligible
land use type.

Question 26. Can you tell us where most of the new CSP contracts
are? We are the 33 million acres?
Answer. Contracts will not be awarded until a late November time-
frame. Below is a summary of application numbers and acres by State.

------------------------------------------------------------------------
State Application Number Estimated Acres
------------------------------------------------------------------------
AK 24 714,083
AL 482 264,039
AR 444 505,206
AZ 53 635,807
CA 351 641,562
CO 518 992,872
CT 12 1,108
DE 29 61,567
FL 128 105,392
GA 326 139,040
HI 17 2,363
IA 1,099 596,031
ID 141 242,374
IL 711 624,717
IN 230 180,684
KS 778 924,135
KY 199 85,195
LA 364 328,692
MA 9 1,042
MD 70 23,030
ME 86 67,759
MI 350 144,162
MN 1,685 853,526
MO 1,821 1,016,057
MS 247 169,606
MT 522 2,185,287
NC 117 48,573
ND 409 1,040,103
NE 2,683 4,340,159
NH 25 175
NJ 0 0
NM 390 3,299,155
NV 7 9,307
NY 317 157,281
OH 373 141,209
OK 660 1,012,827
OR 539 1,407,356
PA 511 193,197
PR 31 1,734
RI 6 600
SC 455 271,871
SD 502 1,751,552
TN 307 117,303
TX 1,879 4,672,270
UT 57 293,076
VA 185 93,227
VT 8 1,291
WA 142 284,515
WI 745 354,395
WV 144 33,972
WY 93 576,984
-----------------------------------------------
Total................. 21,281 32,940,273
------------------------------------------------------------------------

Question 27. Out of the CSP signup, how many do you think are
viable? Specifically, do you think all 33 million acres will result in
CSP contracts?
Answer. NRCS used a producer self-screening checklist to reduce
technical assistance costs in helping potential applicants decide for
themselves whether CSP is the right program for them and their
operation. Producers completed the checklist independently to help
themselves decide if they meet CSP eligibility requirements. Based on
the use of the self-screening checklist, we are projecting that most of
these applicants meet basic eligibility requirements. However, these
acres must be field-verified before they are enrolled. This procedure
was instituted in response to an OIG audit that determined NRCS entered
into contracts with applicants who self-certified erroneous information
about their operations. NRCS is authorized to enroll 12,769,000 acres
for each fiscal year. Those applicants not selected for contract can
chose to have their application deferred for funding consideration
during the next ranking period.

Question 28. What percentage of the old CSP contracts are still
being maintained?
Answer. According to our Programs Contracting System (ProTracts)
there were 20,683 Conservation Security Program contracts active on
September 30, 2009. Approximately 4,422 contracts expired at midnight
on September 30, 2009, leaving 16,261 remaining active contracts
entering into the Fiscal Year 2010.

Question 29. Part of the problem with old CSP program was that
producers and others complained it was too complicated and hard to
understand. What steps are you taking to make this new and improved
program more producer friendly and easy to understand?
Answer. Key program design improvements made to simplify CSP
include:

Eliminated the complicated tier system to determine
participation level.

Reduced payment types from four to two:

Annual payment for installing additional conservation
activities and maintaining existing activities.

Supplemental payment available on cropland for the
adoption of resource-conserving crop rotations.

Simplified basic land treatment eligibility--producers must
address at least one resource concern at the time of
application and a priority resource concern by the end of their
contract.

Designed and developed a conservation measurement tool (CMT)
to estimate the level of environmental benefit of each
producer's existing and planned conservation activities. The
CMT replaced multiple resource assessment tools and functions
to:

Determine basic eligibility.

Determine ranking score.

Establish annual payment.

Based participation on how producer represents their
operation for other USDA programs to eliminate complexity and
inconsistency in operation delineation.

Question 30. What percentage of the old Conservation Security
Program contracts were with dairy operations? Can you provide similar
statistics when they are available on the new Conservation Stewardship
Program?
Answer. Under the Conservation Security Program there are 334
contracts, 327 of which are still active, on dairy operations out of a
total of 21,671 contracts from Fiscal Years 2004-2008. The percentage
of contracts with dairy operations is 1.54 percent. We will be able to
provide similar statistics for the Conservation Stewardship Program
after contract obligation for this signup is complete.

Question 31. The Conservation Stewardship Program includes a
provision for producers participating in CSP to initiate organic
certification under the Organic Foods Production Act of 1990. What
steps is NRCS taking to ensure that this provision is being
implemented, and what steps is NRCS taking to ensure that the paperwork
and planning that transitioning to organic and existing organic farmers
must do and maintain under NRCS programs is streamlined and not
duplicative of the planning and paperwork that the National Organic
Program requires of participating farmers?
Answer. The 2008 Farm Bill recognized the growing interest and
support of organic agriculture across the country by providing
instructions related to organic production in programs that NRCS
administers. For CSP, we responded by developing a document,
``Conservation Stewardship Program's Contribution to Organic
Transitioning--The Organic Crosswalk'', which is available on our web
site. The Organic Crosswalk provides a transparent means through which
producers may initiate organic certification while participating in a
CSP contract. It further assists producers in coordinating and
simultaneously meeting eligibility standards under each program. We
additionally developed program policy on how stewardship plan
information will document the participant's transition to or
participation in the National Organic Program.

Question 32. Was there anything that surprised you about the CSP
sign-up that closed last week? Such as the breakdown between crop,
forest, pasture and rangeland? Any states that had more interest than
you've seen before?
Answer. We are still tallying the acreage breakdown between land
uses, so it might be premature to speak to that. On balance, we are
extremely pleased with the positive response of producers to CSP, as
reflected by application numbers and acres. We believe this indicates
the purpose and design of CSP are close to being on the mark.
Agricultural and forestry producers have a strong interest in a working
lands conservation program that recognizes existing stewardship and
delivers valuable new conservation. We are also extremely pleased, but
not surprised, by how NRCS employees responded on short notice to not
only learn a new program, but effectively deliver it in less than a
three month timeframe. Their sustained performance is to be commended.

Question 33. One problem I see in the rule proposed by NRCS is this
new $40,000 a year limitation. We have heard from some producer groups
that this might be a disincentive for producers to enroll. Since this
limitation is not in the law, why did the Administration implement such
a rule that I think could turn producers away?
Answer. The statute provides that the payments will be made to
participants as soon as practicable after October 1 of each fiscal year
for activities carried out in the previous fiscal year. This
retrospective payment approach provides a critical control and
improvement over the former CSP, which made payments for work yet to be
completed. Those prospective payments have caused the agency to invest
considerable administrative expense for our technical assistance
account to recover payments from participants who failed to apply
contracted conservation activities. The $40,000 annual payment limit
ensures that NRCS will make payments to participants each fiscal year.
It additionally eliminates the risk of making contract payments
prospectively for participants with large contracts who might otherwise
reach their contract limit as early as year one of their contract.

Question 34. The explanation accompanying the interim final
regulation explains that the $40,000 limit is necessary to ensure that
participants who might reach their limit early in the contract will
have an incentive to meet their obligations over the life of the
contract. However there are extensive enforcement provisions in the
regulation including authority to require repayment of all benefits
with penalties and ineligibility for all conservation programs. Since
the participant is entering into a contract and there is extensive
enforcement authority why is an additional limitation required?
Answer. Recovering payments due to contract violation cuts into
technical assistance funds NRCS would prefer to invest in providing
technical services to contract participants to apply new conservation
activities. Given that NRCS must manage the program to achieve a
national average rate of $18 per acre, which includes cost for
technical assistance, we need to limit administrative expenses for
contract noncompliance.
Technical Assistance
Question 35. Anticipating that the regulations governing and
practices of organic agricultural systems might be relatively new to
NRCS and its staff, the 2008 Farm Bill also included provisions to
ensure that NRCS provides adequate technical assistance for the
implementation of conservation practices by producers involved with
organic production, including through cooperative agreements with other
agencies and nongovernmental organizations.
Can you please describe the steps that you have taken and will take
to ensure that NRCS staff both have the knowledge about organic
agriculture and can provide adequate technical assistance to producers
involved with organic production, both through technical assistance
provided by NRCS as well as through assistance provided through
cooperative agreements with agencies and nongovernmental organizations
that have expertise in organic agriculture?
Answer. During Fiscal Year 2009, NRCS reviewed all of our
conservation practices at the national and state level to determine
their applicability to organic farming operations. The review
identified a few cases where state standards needed to be modified to
allow organically approved products to be used (i.e., seed
certification, non-treated fence posts). The technical treatment and
practices to address resource concerns (soil erosion, soil quality,
water quality, irrigation water management, air quality, plants, and
animals) on organic operations are the same basic technologies used on
non-organic farms.
In addition, NRCS also used the Federal Register to solicit
comments from the public on our conservation practices. Additional
comments were received to improve our conservation practices for
organic operations.
NRCS created a $50 Million EQIP Initiative (special funding pool)
for organic producers and those transitioning to organic production to
apply for financial assistance to apply needed conservation practices
to facilitate their organic operations. Additional guidance and
training was provided to NRCS state and field staff on special planning
consideration for planning conservation practices on organic farms.
NRCS also developed a special conservation activity under EQIP
where approved Technical Service Providers (TSP) would develop a
Conservation Plan (138) for organic farms or for farms transitioning to
organic operations.
We also developed a website on Organic Agriculture to address
technical and financial assistance available for organic producers. The
website also identifies NRCS contacts in each state to address issues
related to organic production.
The NRCS Technical Service Provider Team and Ecological Sciences
Division have met with representatives from the Sustainable Agriculture
Coalition and Integrated Pest Management Institute to develop training
curricula for technical service providers and to exchange ideas about
incorporating organic agriculture techniques into NRCS criteria. The
Technical Service Provider Team is working closely with these
organizations to develop Memoranda of Understanding.
NRCS has met with non-governmental organizations representing
sustainable and organic farming to listen to their concerns and
suggestions for NRCS programs. NRCS also meet with the Agricultural
Marketing Service (AMS) to ensure the NRCS programs did not conflict
with the National Organic Program.
Finally, the three NRCS Regional Technical Centers are developing
additional training for NRCS personnel to better serve the organic
farming community.

Question 36. The 2008 Farm Bill included a definition of technical
assistance. Can you tell me if this has been beneficial? Do people have
a better understanding of what technical assistance is?
Answer. The inclusion of a definition of technical assistance in
the 2008 Farm Bill has increased the effectiveness of farm bill
programs by allowing activities that will accelerate the implementation
of conservation practices. The definition of technical assistance was
further expanded in the technical service provider interim final rule
and several positive comments were received from the public with
suggestions to further explain what activities are included in this
definition.

Question 38. The groups that tried to utilize the Technical Service
Provider system had a number of concerns about trying to get certified,
from the payment rates to a lack of support from some State
Conservationists. What are your thoughts on the use of third party
providers and how do you intend to utilize them to help with a growing
workload and a fairly stagnant NRCS workforce?
Answer. In Fiscal Year 2009, NRCS signed agreements or renewed the
certification of 423 individual TSPs and 21 businesses. There are now
more than 1,110 individual TSPs and 88 businesses certified and
available to help program participants apply conservation. Since the
passage of the 2002 Farm bill, NRCS has obligated over $300 million to
acquire TSP technical services. In Fiscal Year 2005 NRCS invested $49.9
million, in Fiscal Year 2006 $55 million, in Fiscal Year 2007 $42.5
million, in Fiscal Year 2008 $36.8 million, and in fiscal 2009 $46.7
million.
Looking ahead, NRCS has selected GeoAgro to serve as the first
national transaction handler for a Conservation Transaction Plug-In
(CTP) application. With a commercial transaction handler in place, TSPs
nationwide will be able to ``check out and check in'' producers'
conservation plans and folders from the TSP's own computer.
Implementation of this plug-in is scheduled for December 2009.

Question 39. The farm bill required you to review conservation
practice standards, and it also called on the agency to specifically
review the needs of specialty crop, organic and precision agriculture.
Has this review been carried out at the national and state levels?
Answer. During the summer of 2008, all NRCS conservation practices
were reviewed at the national and state levels. The review identified a
few cases where state standards needed to be modified to allow
organically approved products to be used (seed, non-treated fence
posts). The basic technology in the conservation practice standards to
address the resource concerns applied to organic and non-organic
farming operations. In some cases, different practices would be used to
address a resource concern, but practices and flexibility within the
practices are adequate for both organic and non-organic operations.
All NRCS conservation practice standards are reviewed at least
every five years, and more often if needed to address a concern or new
technology. As we progress through our conservation practice revisions
we are ensuring the criteria, where appropriate, is adequate to address
organic farming, precision agriculture, and specialty crops.
During the summer of 2009, NRCS published all of our conservation
practice standards in the Federal Register. We received 34 comments
from individuals, non-governmental organizations, and government
agencies. These comments are being documented and recommendations are
being developed to address the commenters' concerns.
Regional Equity
Question 40. Regional equity was changed so that states which
received less than $15M in conservation program funding would be a
regional equity state. Are more states considered regional equity
states? If so, how many and which ones? What impact has this change had
on existing regional equity states?
Answer. In Fiscal Year 2008, states that received less than $12
million were considered regional equity states. In Fiscal Years 2008
and 2009, there were 13 Regional Equity states. If the increase from
$12 million to $15 million had not occurred, Vermont, New Hampshire,
Maine, Hawaii and Alaska would be the only Regional Equity states in
2009.
Waiver of Payment Limits
Question 41. We included provisions in the 2008 Farm Bill that
allowed for some of the payment limits and payment terms in
conservation programs to be waived. Have you received any waiver
requests?
Answer. Yes, five requests for AGI waivers were submitted with 4
waivers being approved in Fiscal Year 2009.
Seventeen requests for payment limitation waivers were submitted
with 11 waivers being approved in Fiscal Year 2009.
Environmental Services
Question 42. The 2008 Farm Bill contained a provision to facilitate
the participation of farmers and landowners in environmental services
markets. Can you tell us the status of the provision's implementation?
Answer. NRCS recognizes that environmental benefits will be
achieved by implementing conservation practices funded through NRCS
programs, and that environmental credits may accrue through the
implementation of practices compatible with the purposes of NRCS
contracts. NRCS asserts no direct or indirect interest on these
credits. However, NRCS retains the authority to ensure that operation
and maintenance (O&M) requirements for improvements funded through USDA
conservation programs are carried out by program participants. Where
environmental services activities may impact the land under an NRCS
contract, participants are highly encouraged to request an O&M
compatibility determination from NRCS prior to entering into any credit
agreements.
RC&Ds
Question 43. There was language included in the farm bill that
directed NRCS to designate a coordinator for each RC&D council. There
have been concerns among local RC&D councils that the folks they were
supposed to be working with had other responsibilities in addition to
their coordinator position. Can you tell us what your current goal is
in regard to RC&D coordinators and what the level of funding in the
FY10 ag approps bill will allow you to do?
Answer. Our goal is to have a full-time Coordinator for each of the
375 RC&D Councils. Current estimates, however, indicate that the
current funding level is insufficient to accomplish this goal.
Adjustments are being made to the Fiscal Year 2010 RC&D allocation
formula that will give more weight to the practical costs of operating
each RC&D Council. This will allow some States to fill vacant
Coordinator positions, or adjust workload priorities to increase the
level of RC&D assistance.